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SGC Superior Group of Companies Inc

19.25
-0.10 (-0.52%)
After Hours
Last Updated: 23:00:02
Delayed by 15 minutes
Share Name Share Symbol Market Type
Superior Group of Companies Inc NASDAQ:SGC NASDAQ Common Stock
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  -0.10 -0.52% 19.25 18.32 20.08 19.35 18.90 19.35 89,565 23:00:02

Form 8-K - Current report

07/05/2024 9:17pm

Edgar (US Regulatory)


false 0000095574 0000095574 2024-05-07 2024-05-07
 
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) May 7, 2024
 
Superior Group of Companies, Inc.
(Exact name of registrant as specified in its charter)
 
Florida
001-05869
11-1385670
(State or other jurisdiction
of incorporation)
(Commission
File Number)
(IRS Employer
Identification No.)
     
 
200 Central Avenue, Suite 2000, St. Petersburg, Florida
(Address of principal executive offices)
33701
(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 March 31, 2024. A copy of this press release is attached as Exhibit 99.1 to this Form 8-K.
 
Item 9.0l     Financial Statements and Exhibits
 
(d) Exhibits
 
  Exhibit Number   Description
  99.1   Press Release, dated May 7, 2024
  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.
By:
/s/ Michael Koempel
Michael Koempel
Chief Financial Officer
 
 
 
 
 
Date: May 7, 2024
 
 
 

Exhibit 99.1

 logo01.jpg

FOR IMMEDIATE RELEASE

 

SUPERIOR GROUP OF COMPANIES REPORTS FIRST QUARTER 2024 RESULTS

 

– Total net sales of $138.8 million up from $130.8 million in prior year first quarter
– Net income of $3.9 million up from $0.9 million in prior year first quarter 
– EBITDA of $9.6 million up from $6.9 million in prior year first quarter
– Board of Directors approves $0.14 per share quarterly dividend 
– Raises full-year outlook 

 

ST. PETERSBURG, Fla., May 7, 2024 – Superior Group of Companies, Inc. (NASDAQ: SGC) (the “Company”), today announced its first quarter 2024 results.

 

“The year is off to a strong start, with year-over-year revenue and EBITDA growth for all three of our business segments driving positive cash flow and improved financial flexibility,” said Michael Benstock, Chief Executive Officer. “To capitalize on gradually improving underlying trends across our attractive end markets, our team’s focus is on strong customer service and retention. With an always long-term view of our business, we are also prudently investing in talent, processes and systems to capture future market share to enhance our long-term profitability and create additional shareholder value. We remain confident in our future outlook and are raising our full-year expectations, as we are seeing positive momentum across each of our business segments.”

 

First Quarter Results

 

For the first quarter ended March 31, 2024, net sales increased 6.2% to $138.8 million, compared to first quarter 2023 net sales of $130.8 million. Pretax income was $4.6 million compared to $0.9 million in the first quarter of 2023. Net income was $3.9 million or $0.24 per diluted share compared to $0.9 million, or $0.06 per diluted share for the first quarter of 2023.

 

First Quarter 2024 Dividend

 

The Board of Directors declared a quarterly dividend of $0.14 per share, payable June 3, 2024 to shareholders of record as of May 20, 2024.

 

2024 Full-Year Outlook

 

The Company is raising its full year 2024 sales outlook to a range of $563 million to $570 million from the prior range of $558 million to $568 million, and versus 2023 sales of $543 million. Also, the Company is raising its full-year earnings per diluted share forecast to a range of $0.73 to $0.79, which reflects improved operating performance, partially offset by incremental stock compensation expense from the May issuance of performance-based stock awards. The updated earnings per diluted share outlook is up from the prior range of $0.61 to $0.68 and compares to $0.54 in 2023.

 

1

 

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 May 21, 2024. 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 6849361 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 supply disruptions, inflationary environment (including with respect to 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 Companys 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 Companys previously disclosed material weakness in internal control over financial reporting; the Companys 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 Companys 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, 2023 and the Quarterly Report on Form 10-Q for the quarter ended March 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

 

2

 

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 March 31,

 
   

2024

   

2023

 

Net sales

  $ 138,842     $ 130,773  
                 

Costs and expenses:

               

Cost of goods sold

    83,525       83,665  

Selling and administrative expenses

    48,749       43,379  

Other periodic pension costs

    189       214  

Interest expense

    1,787       2,570  
      134,250       129,828  

Income before income tax expense

    4,592       945  

Income tax expense

    680       57  

Net income

  $ 3,912     $ 888  
                 

Net income per share:

               

Basic

  $ 0.24     $ 0.06  

Diluted

  $ 0.24     $ 0.06  
                 

Weighted average shares outstanding during the period:

               

Basic

    16,028,032       15,882,994  

Diluted

    16,453,452       16,118,329  
                 

Cash dividends per common share

  $ 0.14     $ 0.14  

 

3

 

SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except shares and par value data)

 

   

March 31,

   

December 31,

 
   

2024

   

2023

 
   

(Unaudited)

         

ASSETS

               

Current assets:

               

Cash and cash equivalents

  $ 22,040     $ 19,896  

Accounts receivable, less allowance for doubtful accounts of $4,213 and $4,237, respectively

    93,737       103,494  

Accounts receivable - other

    119       307  

Inventories

    92,573       98,067  

Contract assets

    52,511       48,715  

Prepaid expenses and other current assets

    6,549       8,881  

Total current assets

    267,529       279,360  

Property, plant and equipment, net

    45,319       46,890  

Operating lease right-of-use assets

    17,484       17,909  

Deferred tax asset

    12,349       12,356  

Intangible assets, net

    50,150       51,160  

Other assets

    15,650       14,775  

Total assets

  $ 408,481     $ 422,450  
                 

LIABILITIES AND SHAREHOLDERS’ EQUITY

               

Current liabilities:

               

Accounts payable

  $ 41,653     $ 50,520  

Other current liabilities

    40,414       43,978  

Current portion of long-term debt

    5,156       4,688  

Current portion of acquisition-related contingent liabilities

    942       1,403  

Total current liabilities

    88,165       100,589  

Long-term debt

    84,445       88,789  

Long-term pension liability

    13,361       13,284  

Long-term acquisition-related contingent liabilities

    612       557  

Long-term operating lease liabilities

    12,513       12,809  

Other long-term liabilities

    8,564       8,784  

Total liabilities

    207,660       224,812  

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 16,743,723 and 16,564,712 shares, respectively

    16       16  

Additional paid-in capital

    79,602       77,443  

Retained earnings

    123,946       122,464  

Accumulated other comprehensive loss, net of tax:

               

Pensions

    (1,099 )     (1,122 )

Foreign currency translation adjustment

    (1,644 )     (1,163 )

Total shareholders’ equity

    200,821       197,638  

Total liabilities and shareholders’ equity

  $ 408,481     $ 422,450  

 

 

4

 

SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

(In thousands)

 

   

Three Months Ended March 31,

 
   

2024

   

2023

 

CASH FLOWS FROM OPERATING ACTIVITIES

               

Net income

  $ 3,912     $ 888  

Adjustments to reconcile net income to net cash provided by operating activities:

               

Depreciation and amortization

    3,252       3,388  

Inventory write-downs

    420       -  

Provision for bad debts - accounts receivable

    83       (97 )

Share-based compensation expense

    1,015       1,080  

Change in fair value of acquisition-related contingent liabilities

    152       (563 )

Change in fair value of written put options

    392       (442 )

Changes in assets and liabilities, net of acquisition of businesses:

               

Accounts receivable

    9,419       10,150  

Accounts receivable - other

    188       2,928  

Contract assets

    (3,835 )     1,590  

Inventories

    5,010       2,807  

Prepaid expenses and other current assets

    2,252       2,403  

Other assets

    (803 )     (657 )

Accounts payable and other current liabilities

    (12,122 )     1,596  

Long-term pension liability

    108       209  

Other long-term liabilities

    4       (230 )

Net cash provided by operating activities

    9,447       25,050  
                 

CASH FLOWS FROM INVESTING ACTIVITIES

               

Additions to property, plant and equipment

    (675 )     (2,114 )

Net cash used in investing activities

    (675 )     (2,114 )
                 

CASH FLOWS FROM FINANCING ACTIVITIES

               

Proceeds from borrowings of debt

    7,000       1,000  

Repayment of debt

    (10,937 )     (12,938 )

Payment of cash dividends

    (2,330 )     (2,295 )

Payment of acquisition-related contingent liabilities

    (557 )     -  

Proceeds received on exercise of stock options

    449       35  

Net cash used in financing activities

    (6,375 )     (14,198 )
                 

Effect of currency exchange rates on cash

    (253 )     140  

Net increase in cash and cash equivalents

    2,144       8,878  

Cash and cash equivalents balance, beginning of period

    19,896       17,722  

Cash and cash equivalents balance, end of period

  $ 22,040     $ 26,600  

 

5

 

SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES

NON-GAAP FINANCIAL MEASURES

(Unaudited)

(In thousands, except shares and per share data)

 

   

Three Months Ended March 31,

 
   

2024

   

2023

 

Net income

  $ 3,912     $ 888  

Interest expense

    1,787       2,570  

Income tax expense

    680       57  

Depreciation and amortization

    3,252       3,388  

EBITDA(1)

  $ 9,631     $ 6,903  

 

(1) EBITDA, which is a non-GAAP financial measure, is defined as net income excluding interest expense, income tax expense and depreciation and amortization expense. 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). 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 and 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.

 

6

 

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 Three Months Ended March 31, 2024:

                                               

Net sales

  $ 87,068     $ 29,237     $ 23,552     $ (1,015 )   $ -     $ 138,842  

Cost of goods sold

    55,327       17,727       10,908       (437 )     -       83,525  

Gross margin

    31,741       11,510       12,644       (578 )     -       55,317  

Selling and administrative expenses

    23,294       9,812       10,421       (578 )     5,800       48,749  

Other periodic pension cost

    -       -       -       -       189       189  

Add: Depreciation and amortization

    1,500       937       723       -       92       3,252  

Segment EBITDA(1)

  $ 9,947     $ 2,635     $ 2,946     $ -     $ (5,897 )   $ 9,631  
                                                 
   

Branded Products

   

Healthcare Apparel

   

Contact Centers

   

Intersegment Eliminations

   

Other

   

Total

 

For the Three Months Ended March 31, 2023:

                                               

Net sales

  $ 81,851     $ 28,154     $ 22,056     $ (1,288 )   $ -     $ 130,773  

Cost of goods sold

    55,952       18,054       10,267       (608 )     -       83,665  

Gross margin

    25,899       10,100       11,789       (680 )     -       47,108  

Selling and administrative expenses

    20,053       9,502       9,664       (680 )     4,840       43,379  

Other periodic pension cost

    -       -       -       -       214       214  

Add: Depreciation and amortization

    1,664       974       668       -       82       3,388  

Segment EBITDA(1)

  $ 7,510     $ 1,572     $ 2,793     $ -     $ (4,972 )   $ 6,903  

 

(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 EBITDA include: interest expense and depreciation and amortization expense. Total Segment EBITDA is a non-GAAP financial measure. Please see reconciliation of EBITDA included in the Non-GAAP Financial Measures table above.

 

7
v3.24.1.u1
Document And Entity Information
May 07, 2024
Document Information [Line Items]  
Entity, Registrant Name Superior Group of Companies, Inc.
Document, Type 8-K
Document, Period End Date May 07, 2024
Entity, Incorporation, State or Country Code FL
Entity, File Number 001-05869
Entity, Tax Identification Number 11-1385670
Entity, Address, Address Line One 200 Central Avenue, Suite 2000
Entity, Address, City or Town St. Petersburg
Entity, Address, State or Province FL
Entity, Address, Postal Zip Code 33701
City Area Code 727
Local Phone Number 397-9611
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity, Emerging Growth Company false
Title of 12(b) Security Common Stock
Trading Symbol SGC
Security Exchange Name NASDAQ
Amendment Flag false
Entity, Central Index Key 0000095574

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