8-K
SUPERIOR GROUP OF COMPANIES, INC. (SGC)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) March 11, 2025
Superior Group of Companies, Inc.
(Exact name of registrant as specified in its charter)
| Florida | 001-05869 | 11-1385670 |
|---|---|---|
| (State or other jurisdiction<br> of incorporation) | (Commission<br> File Number) | (IRS Employer<br> Identification No.) |
| 200 Central Avenue, Suite 2000, St. Petersburg, Florida<br><br> <br>(Address of principal executive offices) | 33701<br><br> <br>(Zip Code) |
Registrant's telephone number including area code: (727) 397-9611
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230 .425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| --- | --- |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Common Stock | SGC | NASDAQ |
Item 2.02. Results of Operations and Financial Condition
The following information is being furnished under Item 2.02 of Form 8-K: Press release by Superior Group of Companies, Inc. (the “Company”) announcing its results of operations for the quarter ended December 31, 2024. A copy of this press release is attached as Exhibit 99.1 to this Form 8-K.
Item 7.01. Regulation FD Disclosure
On March 11, 2025, the Company posted an investor presentation on its website. A copy of this presentation is attached as Exhibit 99.2 to this Form 8-K.
The information furnished pursuant to Items 2.02 and 7.01 of this Form 8-K, including Exhibits 99.1 and 99.2 hereto, shall not be deemed "filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act”), or otherwise subject to the liabilities under that section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Item 9.0l. Financial Statements and Exhibits
(d) Exhibits
Exhibit Number Description
10.1 Second Amendment to Credit Agreement
99.1 Press Release, dated March 11, 2025
99.2 Investor Presentation, dated March 11, 2025
104 Cover Page Interactive Data File (embedded within the Inline XBRL document)
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunder duly authorized.
| SUPERIOR GROUP OF COMPANIES, INC.<br><br> <br><br><br> <br><br><br> <br><br><br> <br>By: /s/ Michael Koempel<br><br> <br>Michael Koempel<br><br> <br>Chief Financial Officer |
|---|
Date: March 11, 2025
ex_787509.htm
Exhibit 10.1
SECOND AMENDMENT TO CREDIT AGREEMENT
This SECOND AMENDMENT TO CREDIT AGREEMENT, dated as of March 7, 2025 (this “Agreement”), is entered into by and among SUPERIOR GROUP OF COMPANIES, INC., a Florida corporation (the “Borrower”), the Guarantors party hereto, the Lenders party hereto, and PNC BANK, NATIONAL ASSOCIATION in its capacities as Administrative Agent, Swingline Loan Lender and Issuing Lender.
RECITALS
A. The Borrower, the Guarantors from time to time party thereto, the Lenders from time to time party thereto, and the Administrative Agent are parties to that certain Credit Agreement, dated as of August 23, 2022 (as amended, restated, amended and restated, modified, supplemented, increased and extended from time to time, the “Credit Agreement”).
B. The Borrower has requested an amendment to the Credit Agreement.
C. The Required Lenders have agreed to such requested amendment to the Credit Agreement, subject to the terms and conditions hereof.
AGREEMENT
NOW, THEREFORE, in consideration of the agreements contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1. Defined Terms. Capitalized terms used herein and not otherwise defined herein (including in the introductory paragraph and recitals) shall have the meanings given to such terms in the Credit Agreement.
2. Amendment to Credit Agreement. Section 9.4(c) of the Credit Agreement is hereby amended and restated in its entirety to read as follows:
(c) so long as no Potential Default or Event of Default has occurred and is continuing or would result therefrom, the Borrower or any of its Subsidiaries may make Restricted Payments in an amount not to exceed $30,000,000.00 in any fiscal year; provided that, the Consolidated Total Net Leverage Ratio shall not exceed 3.50:1.00 on a Pro Forma Basis immediately after giving effect to any such Restricted Payment.
3. Conditions Precedent. This Agreement shall be effective upon satisfaction of the following conditions precedent:
(a) Agreement. Receipt by the Administrative Agent of a counterpart of this Agreement signed by the Administrative Agent, the Required Lenders, the Borrower and the Guarantors.
(b) Administrative Agent Fees and Expenses. Receipt by the Administrative Agent of all fees and other amounts due and payable on or prior to the date hereof, including, without limitation, reimbursement or payment of all reasonable and documented out-of-pocket expenses (including reasonable fees, charges and disbursements of counsel to the Administrative Agent) required to be reimbursed or paid by the Borrower pursuant to Section 4 of this Agreement.
4. Expenses. The Borrower agrees to pay all reasonable and documented out-of-pocket expenses (including reasonable fees, charges and disbursements of counsel to the Administrative Agent) with respect to the preparation, execution and delivery of this Agreement to the extent such are required to be reimbursed or paid by the Borrower pursuant to Section 12.3 of the Credit Agreement.
5. Miscellaneous.
(a) This Agreement shall be deemed to be, and is, a Loan Document.
(b) Effective as of the date hereof, all references to the Credit Agreement in each of the Loan Documents shall hereafter mean the Credit Agreement as amended by this Agreement.
(c) Except as expressly modified by this Agreement, the Credit Agreement, the Loan Documents and the obligations of each Loan Party thereunder and under the other Loan Documents are hereby ratified and confirmed and shall continue and remain in full force and effect according to their terms.
(d) Each of the Loan Parties (i) acknowledges and consents to all of the terms and conditions of this Agreement, (ii) agrees that this Agreement and all documents executed in connection herewith do not operate to reduce or discharge its obligations under the Credit Agreement or the other Loan Documents or any certificates, documents, agreements and instruments executed in connection therewith, (iii) affirms all of its obligations under the Loan Documents, (iv) agrees that this Agreement shall in no manner impair or otherwise adversely affect any of the Liens granted in or pursuant to the Loan Documents and (v) affirms that each of the Liens granted in or pursuant to the Loan Documents are valid and subsisting.
(e) Each of the Loan Parties hereby represents and warrants to the Administrative Agent and the Lenders as follows:
(i) the execution, delivery and performance by such Loan Party of this Agreement are within such Loan Party’s organizational powers and have been duly authorized by all necessary organizational, and if required, shareholder, partner or member, action, as applicable;
(ii) this Agreement has been duly executed and delivered by such Loan Party and constitutes a legal, valid and binding obligation of such Loan Party, enforceable against such Loan Party in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting the enforcement of creditors’ rights generally and by general principles of equity;
(iii) the execution, delivery and performance by such Loan Party of this Agreement do not require any consent or approval of, registration or filing with, notice to, or any action by, any governmental authority, except those as have been obtained or made and are in full force and effect;
(iv) after giving effect to this Agreement, all representations and warranties of each Loan Party set forth in the Loan Documents are true and correct in all material respects (other than those representations and warranties that are expressly qualified by a Material Adverse Change or other materiality, in which case such representations and warranties are true and correct in all respects) except to the extent that such representations and warranties specifically refer to an earlier date, in which case they are true and correct in all material respects (other than those representations and warranties that are expressly qualified by a Material Adverse Change or other materiality, in which case such representations and warranties are true and correct in all respects) as of such earlier date; and
(v) after giving effect to this Agreement, no Potential Default or Event of Default exists.
(f) This Agreement may be executed by one or more of the parties to this Agreement on any number of separate counterparts (including by electronic mail), and all of said counterparts taken together shall be deemed to constitute one and the same instrument. Delivery of an executed counterpart of a signature page of this Agreement by electronic transmission or by any other electronic imaging means (including .pdf), shall be effective as delivery of a manually executed counterpart of this Agreement.
(g)&NBSP;&NBSP;&NBSP;&NBSP;THIS AGREEMENT AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY AND THEREBY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK.
6. No Other Changes. Except as modified hereby, all of the terms and provisions of the Loan Documents shall remain in full force and effect.
[Signature pages follow.]
IN WITNESS WHEREOF, each of the parties hereto has caused a counterpart of this Agreement to be duly executed and delivered as of the date first above written.
BORROWER: SUPERIOR GROUP OF COMPANIES, INC.,
a Florida corporation
By:
Name: Jake Himelstein
Title: Authorized Representative
GUARANTORS: CID RESOURCES, INC.,
a Delaware corporation
SUPERIOR UNIFORM GROUP, LLC,
a Florida limited liability company
FASHION SEAL CORPORATION,
a Nevada corporation
THE OFFICE GURUS, LLC,
a Florida limited liability company
SUPERIOR UNIFORM ARKANSAS LLC,
an Arkansas limited liability company
SUPERIOR GROUP HOLDINGS, INC.,
a Texas corporation
SUPERIOR GROUP HOLDINGS (IL), LLC,
an Illinois limited liability company
ZING MANUFACTURING, LLC,
a Delaware limited liability company
By:
Name: Jake Himelstein
Title: Authorized Representative
BAMKO, LLC,
a Delaware limited liability company
LOGO LINEUP, LLC,
a Delaware limited liability company
By:
Name: Jake Himelstein
Title: Authorized Representative
ADMINISTRATIVE
AGENT: PNC BANK, NATIONAL ASSOCIATION,
as Administrative Agent, as Swingline Loan Lender, as Issuing Lender and as a Lender
By:
Name:
Title:
LENDER: BMO HARRIS BANK, N.A.,
as a Lender
By:
Name:
Title:
LENDER: VALLEY NATIONAL BANK,
as a Lender
By:
Name:
Title:
LENDER: SOUTHSTATE BANK, N.A.,
as a Lender
By:
Name:
Title:
ex_730291.htm
Exhibit 99.1
 |
FOR IMMEDIATE RELEASE |
|---|---|
| A NASDAQ Listed Company: SGC |
SUPERIOR GROUP OF COMPANIES REPORTS FOURTH QUARTER 2024 RESULTS
| – Total net sales of $145.4 million versus $147.2 million in prior year fourth quarter– |
|---|
| – Net income of $2.1 million versus $3.6 million in prior year fourth quarter– |
| – EBITDA of $7.3 million versus $9.9 million in prior year fourth quarter – |
| – Board of Directors approves additional stock repurchase plan – |
| – Provides full-year outlook – |
ST. PETERSBURG, Fla. – March 11, 2025 – Superior Group of Companies, Inc. (NASDAQ: SGC) (the “Company”), today announced its fourth quarter 2024 results.
“For 2024, we grew sales and diluted EPS 4% and 35%, respectively, while strengthening our balance sheet and making strategic investments in our people, services, products and technology. Capping the year, our fourth quarter results came in as expected, placing us within our full-year outlook ranges which were raised in May of last year, and again reflecting back-end weighted results as anticipated,” said Michael Benstock, Chief Executive Officer. “While market conditions continue to reflect customer uncertainty, our team is demonstrating resilience and adaptability, and we are committed to tackling what we can control. Specifically, we are focused on cost management, operational efficiencies, customer experience and driving innovation, and when conditions turn we see tremendous opportunities for growth and market share opportunities across our three attractive end markets. Our outlook for 2025 reflects continued growth and margin expansion, and today our Board has approved a significant expansion of our share repurchase authorization.”
Fourth Quarter Results
For the fourth quarter ended December 31, 2024, net sales declined to $145.4 million compared to fourth quarter 2023 net sales of $147.2 million. Pretax income declined to $2.5 million compared to $4.2 million in the fourth quarter of 2023. Net income declined to $2.1 million or $0.13 per diluted share compared to $3.6 million or $0.22 per diluted share for the fourth quarter of 2023.
2025 Full-Year Outlook
The Company forecasts full-year 2025 net sales in the range of $585 million to $595 million, versus 2024 net sales of $565.7 million, and forecasts full-year earnings per diluted share in the range of $0.75 to $0.82, versus $0.73 in 2024.
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Stock Repurchase Plan
The Board of Directors approved a new stock repurchase plan which authorizes the Company to repurchase up to an additional $17.5 million worth of its common stock. This plan will be in effect upon completion or expiration of the previous plan approved by the Board of Directors on August 12, 2024, which had authorized the repurchase of up to $10 million and through which the Company had purchased 523,472 shares for $7.4 million through year-end 2024.
The new stock repurchase plan, which has no expiration date, allows the Company to purchase common stock from time to time through, among other ways, open market purchases, privately negotiated transactions, block purchases, and/or pursuant to Rule 10b5-1 trading plans, subject to certain requirements and factors. The number of shares purchased and the timing of any purchases will depend upon a number of factors, including the price and availability of the Company’s stock and general market conditions. Shares repurchased may be reissued later in connection with employee benefit plans and other general corporate purposes.
Second Amendment to Credit Agreement
On March 7, 2025, the Company, entered into a Second Amendment to the Credit Agreement among the Company, the domestic subsidiaries of the Company, as guarantors, the lenders party thereto (the “Lenders”), and PNC Bank, National Association, as administrative agent for the Lenders, pursuant to which the Company is now allowed to make restricted payments in an amount not to exceed $30 million in any fiscal year, up from $20 million previously, which increase will allow the Company greater flexibility in paying dividends and funding share repurchases.
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Webcast and Conference Call
The Company will host a webcast and conference call at 5:00 pm Eastern Time today. The live webcast and archived replay can be accessed in the investor relations section of the Company's website at https://ir.superiorgroupofcompanies.com/Presentations. Interested individuals may also join the teleconference by dialing 1-844-861-5505 for U.S. dialers and 1-412-317-6586 for International dialers. The Canadian Toll-Free number is 1-866-605-3852. Please ask to be joined to the Superior Group of Companies call. A telephone replay of the teleconference will be available through March 18, 2025. To access the replay, dial 1-877-344-7529 in the United States or 1-412-317-0088 from international locations. Canadian dialers can access the replay at 855-669-9658. Please reference conference number 8841600 for replay access.
Disclosure Regarding Forward Looking Statements
Certain matters discussed in this press release are “forward-looking statements” intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements can generally be identified by use of the words “may,” “will,” “should,” “could,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” “project,” “potential,” or “plan” or the negative of these words or other variations on these words or comparable terminology. Forward-looking statements in this press release may include, without limitation: (1) projections of revenue, income, and other items relating to our financial position and results of operations, including short-term and long-term plans for cash (2) statements of our plans, objectives, strategies, goals and intentions, (3) statements regarding the capabilities, capacities, market position and expected development of our business operations and (4) statements of expected industry and general economic trends.
Such forward-looking statements are subject to certain risks and uncertainties that may materially adversely affect the anticipated results. Such risks and uncertainties include, but are not limited to, the following: the impact of competition; uncertainties related to a potential trade war, supply disruptions, inflationary environments (including with respect to shipping costs and the cost of finished goods and raw materials and shipping costs), employment levels (including labor shortages), and general economic and political conditions in the areas of the world in which the Company operates or from which it sources its supplies or the areas of the United States of America (“U.S.” or “United States”) in which the Company’s customers are located; changes in the healthcare, retail chain, food service, transportation and other industries where uniforms and service apparel are worn; our ability to identify suitable acquisition targets, discover liabilities associated with such businesses during the diligence process, successfully integrate any acquired businesses, or successfully manage our expanding operations; the price and availability of raw materials; attracting and retaining senior management and key personnel; the effect of the Company’s previously disclosed material weakness in internal control over financial reporting; the Company’s ability to successfully remediate its material weakness in internal control over financial reporting and to maintain effective internal control over financial reporting; and other factors described in the Company’s filings with the Securities and Exchange Commission, including those described in the “Risk Factors” section of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024. Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements made herein and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements made herein are only made as of the date of this press release and we disclaim any obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances, except as may be required by law.
About Superior Group of Companies, Inc. (SGC):
Established in 1920, Superior Group of Companies is comprised of three attractive business segments each serving large, fragmented and growing addressable markets. Across Healthcare Apparel, Branded Products and Contact Centers, each segment enables businesses to create extraordinary brand engagement experiences for their customers and employees. SGC’s commitment to service, quality, advanced technology, and omnichannel commerce provides unparalleled competitive advantages. We are committed to enhancing shareholder value by continuing to pursue a combination of organic growth and strategic acquisitions. For more information, visit www.superiorgroupofcompanies.com.
Investor Relations Contact:
Investors@Superiorgroupofcompanies.com
3
Comparative figures are as follows:
SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except shares and per share data)
| Three Months Ended December 31, | Years Ended December 31, | |||||||
|---|---|---|---|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | |||||
| Net sales | $ | 145,408 | $ | 147,241 | $ | 565,676 | $ | 543,302 |
| Costs and expenses: | ||||||||
| Cost of goods sold | 91,448 | 91,809 | 345,098 | 339,755 | ||||
| Selling and administrative expenses | 50,020 | 49,198 | 199,926 | 184,060 | ||||
| Interest expense | 1,461 | 2,060 | 6,358 | 9,718 | ||||
| 142,929 | 143,067 | 551,382 | 533,533 | |||||
| Income before income tax expense | 2,479 | 4,174 | 14,294 | 9,769 | ||||
| Income tax expense | 390 | 617 | 2,290 | 997 | ||||
| Net income | $ | 2,089 | $ | 3,557 | $ | 12,004 | $ | 8,772 |
| Net income per share: | ||||||||
| Basic | $ | 0.13 | $ | 0.22 | $ | 0.75 | $ | 0.55 |
| Diluted | $ | 0.13 | $ | 0.22 | $ | 0.73 | $ | 0.54 |
| Weighted average shares outstanding during the period: | ||||||||
| Basic | 15,675,402 | 16,010,006 | 16,008,015 | 15,968,199 | ||||
| Diluted | 16,250,792 | 16,238,736 | 16,504,384 | 16,159,308 | ||||
| Cash dividends per common share | $ | 0.14 | $ | 0.14 | $ | 0.56 | $ | 0.56 |
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SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Unaudited)
(In thousands, except share and par value data)
| 2023 | |||||
| ASSETS | |||||
| Current assets: | |||||
| Cash and cash equivalents | 18,766 | $ | 19,896 | ||
| Accounts receivable | 95,092 | 103,494 | |||
| Inventories | 96,675 | 98,067 | |||
| Contract assets | 51,688 | 48,715 | |||
| Prepaid expenses and other current assets | 10,831 | 9,188 | |||
| Total current assets | 273,052 | 279,360 | |||
| Property, plant and equipment, net | 41,879 | 46,890 | |||
| Operating lease right-of-use assets | 15,567 | 17,909 | |||
| Deferred tax asset | 13,835 | 12,356 | |||
| Intangible assets, net | 51,137 | 51,160 | |||
| Goodwill | 2,304 | - | |||
| Other assets | 17,360 | 14,775 | |||
| Total assets | 415,134 | $ | 422,450 | ||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||
| Current liabilities: | |||||
| Accounts payable | 50,942 | $ | 50,520 | ||
| Other current liabilities | 44,367 | 43,978 | |||
| Current portion of long-term debt | 5,625 | 4,688 | |||
| Current portion of acquisition-related contingent liabilities | 814 | 1,403 | |||
| Total current liabilities | 101,748 | 100,589 | |||
| Long-term debt | 80,410 | 88,789 | |||
| Long-term pension liability | 13,315 | 13,284 | |||
| Long-term acquisition-related contingent liabilities | 935 | 557 | |||
| Long-term operating lease liabilities | 10,486 | 12,809 | |||
| Other long-term liabilities | 9,384 | 8,784 | |||
| Total liabilities | 216,278 | 224,812 | |||
| Commitments and contingencies | |||||
| Shareholders’ equity: | |||||
| Preferred stock, .001 par value - authorized 300,000 shares (none issued) | - | - | |||
| Common stock, .001 par value - authorized 50,000,000 shares, issued and outstanding - 16,484,921 and 16,564,712 shares, respectively | 16 | 16 | |||
| Additional paid-in capital | 84,060 | 77,443 | |||
| Retained earnings | 120,139 | 122,464 | |||
| Accumulated other comprehensive loss, net of tax | (5,359 | ) | (2,285 | ) | |
| Total shareholders’ equity | 198,856 | 197,638 | |||
| Total liabilities and shareholders’ equity | 415,134 | $ | 422,450 |
All values are in US Dollars.
5
SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(In thousands)
| Years Ended December 31, | ||||||
|---|---|---|---|---|---|---|
| 2024 | 2023 | |||||
| CASH FLOWS FROM OPERATING ACTIVITIES | ||||||
| Net income | $ | 12,004 | $ | 8,772 | ||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||
| Depreciation and amortization | 13,185 | 13,995 | ||||
| Inventory write-downs | 2,423 | 2,346 | ||||
| Share-based compensation expense | 4,270 | 3,787 | ||||
| Deferred income tax benefit | (1,581 | ) | (1,635 | ) | ||
| Change in fair value of acquisition-related contingent liabilities | 437 | (189 | ) | |||
| Change in fair value of written put options | 653 | 489 | ||||
| Other, net | 739 | 749 | ||||
| Changes in assets and liabilities, net of acquisition of businesses: | ||||||
| Accounts receivable | 7,977 | 1,051 | ||||
| Contract assets | (3,434 | ) | 4,310 | |||
| Inventories | (1,031 | ) | 24,672 | |||
| Prepaid expenses and other current assets | (2,375 | ) | 8,515 | |||
| Other assets | (2,953 | ) | (2,222 | ) | ||
| Accounts payable and other current liabilities | 1,934 | 13,310 | ||||
| Payment of acquisition-related contingent liabilities | (686 | ) | (279 | ) | ||
| Long-term pension liability | 433 | 407 | ||||
| Other long-term liabilities | 1,433 | 851 | ||||
| Net cash provided by operating activities | 33,428 | 78,929 | ||||
| CASH FLOWS FROM INVESTING ACTIVITIES | ||||||
| Additions to property, plant and equipment | (4,435 | ) | (4,963 | ) | ||
| Acquisition of businesses | (4,000 | ) | - | |||
| Other investments | - | (545 | ) | |||
| Net cash used in investing activities | (8,435 | ) | (5,508 | ) | ||
| CASH FLOWS FROM FINANCING ACTIVITIES | ||||||
| Borrowings under revolving lines of credit | 47,000 | 6,000 | ||||
| Payments under revolving lines of credit | (50,000 | ) | (64,000 | ) | ||
| Payment of term loan | (4,687 | ) | (3,750 | ) | ||
| Debt issuance costs | - | (300 | ) | |||
| Payment of cash dividends | (9,284 | ) | (9,188 | ) | ||
| Payment of acquisition-related contingent liabilities | (897 | ) | (553 | ) | ||
| Proceeds received on exercise of stock options | 1,128 | 175 | ||||
| Shares withheld for taxes | (317 | ) | - | |||
| Common stock reacquired and retired | (7,417 | ) | - | |||
| Net cash used in financing activities | (24,474 | ) | (71,616 | ) | ||
| Effect of currency exchange rates on cash | (1,649 | ) | 369 | |||
| Net (decrease) increase in cash and cash equivalents | (1,130 | ) | 2,174 | |||
| Cash and cash equivalents balance, beginning of year | 19,896 | 17,722 | ||||
| Cash and cash equivalents balance, end of year | $ | 18,766 | $ | 19,896 |
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SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES
NON-GAAP FINANCIAL MEASURES
(Unaudited)
(In thousands, except shares and per share data)
| Three Months Ended December 31, | Years Ended December 31, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2024 | 2023 | 2024 | 2023 | |||||||||
| Net income | $ | 2,089 | $ | 3,557 | $ | 12,004 | $ | 8,772 | ||||
| Interest expense | 1,461 | 2,060 | 6,358 | 9,718 | ||||||||
| Income tax expense | 390 | 617 | 2,290 | 997 | ||||||||
| Depreciation and amortization | 3,313 | 3,664 | 13,185 | 13,995 | ||||||||
| Intangible assets impairment charge | - | - | 260 | - | ||||||||
| EBITDA(1) | $ | 7,253 | $ | 9,898 | $ | 34,097 | $ | 33,482 | ||||
| EBITDA margin(1) | 5.0 | % | 6.7 | % | 6.0 | % | 6.2 | % |
(1) EBITDA, which is a non-GAAP financial measure, is defined as net income excluding interest expense, income tax expense, depreciation and amortization expense and impairment charges. EBITDA margin is defined as EBITDA divided by net sales. The Company believes EBITDA is an important measure of operating performance because it allows management, investors and others to evaluate and compare the Company’s core operating results from period to period by removing (i) the impact of the Company’s capital structure (interest expense from outstanding debt), (ii) tax consequences and (iii) asset base (depreciation and amortization and impairment charges). The Company uses EBITDA internally to monitor operating results and to evaluate the performance of its business. In addition, the compensation committee has used EBITDA in evaluating certain components of executive compensation, including performance-based annual incentive programs. EBITDA is not a measure of financial performance under GAAP. EBITDA should not be considered in isolation or as an alternative to net income, cash flows from operating activities or any other measure determined in accordance with GAAP. The items excluded to calculate EBITDA are significant components in understanding and assessing the Company’s results of operations. The presentation of the Company’s EBITDA may change from time to time, including as a result of changed business conditions, new accounting pronouncements or otherwise. If the presentation changes, the Company undertakes to disclose any change between periods and the reasons underlying that change. The Company’s EBITDA may not be comparable to a similarly titled measure of another company because other entities may not calculate EBITDA in the same manner.
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SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES
SUPPLEMENTAL INFORMATION - REPORTABLE SEGMENTS
(Unaudited)
(In thousands)
| Branded Products | Healthcare Apparel | Contact Centers | Intersegment Eliminations | Other | Total | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| For the Year Ended December 31, 2024: | ||||||||||||||
| Net sales | $ | 353,314 | $ | 119,191 | $ | 96,949 | $ | (3,778 | ) | $ | - | $ | 565,676 | |
| Cost of goods sold | 228,591 | 73,445 | 44,742 | (1,680 | ) | - | 345,098 | |||||||
| Gross margin | 124,723 | 45,746 | 52,207 | (2,098 | ) | - | 220,578 | |||||||
| Selling and administrative expenses | 94,384 | 41,149 | 42,999 | (2,098 | ) | 23,492 | 199,926 | |||||||
| Add: Depreciation and amortization | 5,948 | 3,892 | 2,968 | - | 377 | 13,185 | ||||||||
| Intangible assets impairment charge | - | 260 | - | - | - | 260 | ||||||||
| Segment EBITDA(1) | $ | 36,287 | $ | 8,749 | $ | 12,176 | $ | - | $ | (23,115 | ) | $ | 34,097 | |
| Branded Products | Healthcare Apparel | Contact Centers | Intersegment Eliminations | Other | Total | |||||||||
| For the Year Ended December 31, 2023: | ||||||||||||||
| Net sales | $ | 342,680 | $ | 113,878 | $ | 91,500 | $ | (4,756 | ) | $ | - | $ | 543,302 | |
| Cost of goods sold | 228,053 | 71,597 | 42,352 | (2,247 | ) | - | 339,755 | |||||||
| Gross margin | 114,627 | 42,281 | 49,148 | (2,509 | ) | - | 203,547 | |||||||
| Selling and administrative expenses | 88,225 | 38,209 | 39,682 | (2,509 | ) | 20,453 | 184,060 | |||||||
| Add: Depreciation and amortization | 6,744 | 3,925 | 2,942 | - | 384 | 13,995 | ||||||||
| Segment EBITDA(1) | $ | 33,146 | $ | 7,997 | $ | 12,408 | $ | - | $ | (20,069 | ) | $ | 33,482 |
8
| Branded Products | Healthcare Apparel | Contact Centers | Intersegment Eliminations | Other | Total | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| For the Three Months Ended December 31, 2024: | ||||||||||||||
| Net sales | $ | 92,403 | $ | 30,337 | $ | 23,527 | $ | (859 | ) | $ | - | $ | 145,408 | |
| Cost of goods sold | 61,057 | 20,110 | 10,667 | (386 | ) | - | 91,448 | |||||||
| Gross margin | 31,346 | 10,227 | 12,860 | (473 | ) | - | 53,960 | |||||||
| Selling and administrative expenses | 23,898 | 10,218 | 10,563 | (473 | ) | 5,814 | 50,020 | |||||||
| Add: Depreciation and amortization | 1,435 | 1,055 | 722 | - | 101 | 3,313 | ||||||||
| Segment EBITDA(1) | $ | 8,883 | $ | 1,064 | $ | 3,019 | $ | - | $ | (5,713 | ) | $ | 7,253 | |
| Branded Products | Healthcare Apparel | Contact Centers | Intersegment Eliminations | Other | Total | |||||||||
| For the Three Months Ended December 31, 2023: | ||||||||||||||
| Net sales | $ | 97,725 | $ | 28,003 | $ | 22,565 | $ | (1,052 | ) | $ | - | $ | 147,241 | |
| Cost of goods sold | 63,561 | 17,725 | 10,807 | (497 | ) | - | 91,596 | |||||||
| Gross margin | 34,164 | 10,278 | 11,758 | (555 | ) | - | 55,645 | |||||||
| Selling and administrative expenses | 24,392 | 9,748 | 10,180 | (555 | ) | 5,646 | 49,411 | |||||||
| Add: Depreciation and amortization | 1,918 | 911 | 732 | - | 103 | 3,664 | ||||||||
| Segment EBITDA(1) | $ | 11,690 | $ | 1,441 | $ | 2,310 | $ | - | $ | (5,543 | ) | $ | 9,898 |
(1) Segment EBITDA is our primary measure of segment profitability under U.S. GAAP ASC 280 “Segment Reporting”. Amounts included in income before income tax expense and excluded from Segment Adjusted EBITDA include: interest expense, depreciation and amortization expense, impairment charges and any other items not tied to the operational performance of the segment. Total Segment EBITDA is a non-GAAP financial measure. Please see reconciliation of Adjusted EBITDA included in the Non-GAAP Financial Measures table above.
9
Image Exhibit
Exhibit 99.2
