| - 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 (GLOBE NEWSWIRE) -- 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.
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.
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
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 | ||||||||
| SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (Unaudited) (In thousands, except share and par value data) | ||||||||
| December 31, | ||||||||
| 2024 | 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 | ||||
| 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 | ||||
| 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.
| 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 | |||||||||||
| 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.
