Superior Uniform Group, Inc. Reports Second Quarter Operating Results


  • Net Income up 31.2% on 1.5% Increase in Net Sales
  • 19th Consecutive Quarter with Sales Increase

SEMINOLE, Fla., July 27, 2017 (GLOBE NEWSWIRE) --  Superior Uniform Group, Inc. (NASDAQ:SGC), manufacturer of uniforms, career apparel and accessories, today announced that for the second quarter ended June 30, 2017, net sales increased 1.5 percent to $65.6 million compared with 2016 second quarter net sales of $64.7 million.  Net income for the 2017 second quarter was $4.3 million, or $0.29 per diluted share, compared with $3.3 million, or $0.22 per diluted share, reported for the quarter ended June 30, 2016. 

Michael Benstock, Chief Executive Officer, commented, “We are very pleased to report a 31.2 percent increase in net income despite net sales only increasing 1.5 percent.  Net sales in our Uniforms and Related Products segment increased 1.7 percent in the second quarter as customer purchases continue to be somewhat stalled, awaiting more clarity in the political arena.  We are seeing increases in our sales activity with larger volumes of opportunities although they are moving through the pipeline at a slower pace.  The Office Gurus, our Remote Staffing Solutions segment, delivered an excellent second quarter reporting a 28.8 percent increase in net sales.  We are seeing a significant increase in activity in this segment as we continue to broaden our footprint in this underserved market niche.  BAMKO, our Promotional Products segment, reported a decrease in net sales of 10.0 percent.  As we have stated in the past, BAMKO’s sales will fluctuate more widely on a quarter to quarter basis, given the nature of their sales cycle, in contrast with our other segments.  We are very confident in the BAMKO team, and we expect sales performance to return to strong double-digit growth in the third quarter. We are actively pursuing acquisition opportunities in promotional products and are working through a solid pipeline of candidates.”

CONFERENCE CALL

Superior Uniform Group will hold a conference call on Thursday, July 27, 2017 at 2:00 p.m. Eastern Time to discuss the Company’s results. Interested individuals may join the teleconference by dialing (844) 861-5505 for U.S. dialers and (412) 317-6586 for International dialers. The Canadian Toll Free number is (866) 605-3852. Please ask to be joined into the Superior Uniform Group call. The live webcast and archived replay can be accessed in the investor information section of the Company’s website at www.superioruniformgroup.com.

A telephone replay of the teleconference will be available one hour after the end of the call through 2:00 p.m. Eastern Time on August 3, 2017. To access the replay, dial (877) 344-7529 in the United States or (412) 317-0088 from international locations.  Canadian dialers can access the replay at (855) 669-9658.  Please reference conference number 10110251 for all replay access.

About Superior Uniform Group, Inc.

Superior Uniform Group® (NASDAQ:SGC), established in 1920, is one of America’s foremost providers of fine uniforms and image apparel.  Headquartered in Seminole, Fla., Superior Uniform Group manages award-winning uniform apparel programs for major corporations nationwide.  Leaders in innovative uniform program design, global manufacturing, and state-of-the-art distribution, Superior Uniform Group helps companies achieve a more professional appearance and better communicate their brands – particularly those in healthcare, private security, retail, hospitality, transportation and food service industries.

The company’s commitment to service, technology, quality and value-added benefits, as well as its financial strength and resources, support customers’ diverse needs while embracing a “Customer 1st, Every Time!” philosophy and culture.  Superior Uniform Group sells its wide range of products through its signature brands Superior I.D.™, Fashion Seal Healthcare® and HPI Direct®.  Superior Uniform Group is also the parent company for The Office Gurus®, which provides call center and BPO solutions to a variety of customers, and BAMKO®, its innovative promotional products company that provides custom branding solutions to some of the nation’s strongest brands.

For more information, call (800) 727-8643 or visit www.SuperiorUniformGroup.com.

Statements contained in this press release which are not historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995.  All forward-looking statements are subject to risks and uncertainties, including without limitation, those identified in the Company’s SEC filings, which could cause actual results to differ from those projected.

Comparative figures are as follows:

 

  SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES 
 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME 
             
 THREE MONTHS ENDED JUNE 30, 
 (Unaudited) 
             
         2017  2016 
             
 Net sales      $65,604,000  $64,660,000 
             
 Costs and expenses:        
  Cost of goods sold    42,230,000  42,897,000 
  Selling and administrative expenses   17,478,000  16,956,000 
  Interest expense    195,000  192,000 
         59,903,000  60,045,000 
             
 Income before taxes on income    5,701,000  4,615,000 
 Income tax expense    1,360,000  1,307,000 
             
 Net income      $4,341,000   $3,308,000 
             
 Weighted average number of shares outstanding during the period    
        (Basic)   14,501,399   14,120,617 
       (Diluted)   15,040,431    14,957,469 
 Per Share Data:         
 Basic          
  Net income   $  0.30 $  0.23 
 Diluted          
  Net income   $  0.29 $  0.22 
             
             
 Cash dividends per common share   $  0.0875 $  0.0825 
             

 

  SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES 
 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME 
             
 SIX MONTHS ENDED JUNE 30, 
 (Unaudited) 
             
         2017  2016 
             
 Net sales      $126,591,000   $122,628,000 
             
 Costs and expenses:        
  Cost of goods sold    81,003,000  80,844,000 
  Selling and administrative expenses   35,121,000  33,419,000 
  Interest expense    379,000  340,000 
         116,503,000  114,603,000 
             
 Gain on sale of property, plant and equipment   1,018,000    - 
             
 Income before taxes on income    11,106,000  8,025,000 
 Income tax expense    2,930,000  2,275,000 
             
 Net income      $8,176,000   $5,750,000 
             
 Weighted average number of shares outstanding during the period    
        (Basic)   14,426,060    14,023,840 
       (Diluted)   14,985,063    14,813,064 
 Per Share Data:         
 Basic          
  Net income   $  0.57 $  0.41 
 Diluted          
  Net income   $  0.55 $  0.39 
             
             
 Cash dividends per common share   $0.175 $0.165 
             

 

SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES 
 CONSOLIDATED BALANCE SHEETS 
           
ASSETS 
           
       June 30,   
       2017  December 31, 
       (Unaudited) 2016  
CURRENT ASSETS:       
 Cash and cash equivalents    $7,583,000    $3,649,000  
 Accounts receivable, less allowance for doubtful accounts     
 of  $1,755,000 and $1,276,000, respectively  40,620,000   41,823,000  
  Accounts receivable - other   2,412,000     3,085,000  
 Inventories*    67,596,000     69,240,000  
 Prepaid expenses and other current assets    8,567,000     7,214,000  
          TOTAL CURRENT ASSETS   126,778,000   125,011,000  
           
PROPERTY, PLANT AND EQUIPMENT, NET  26,173,000     27,533,000  
OTHER INTANGIBLE ASSETS, NET     22,097,000     23,238,000  
GOODWILL       11,265,000     11,269,000  
DEFERRED INCOME TAXES     7,090,000     6,800,000  
OTHER ASSETS    4,780,000     2,997,000  
        $198,183,000    $196,848,000  
           
LIABILITIES AND SHAREHOLDERS' EQUITY 
           
CURRENT LIABILITIES:        
 Accounts payable     $13,988,000  $13,507,000  
 Other current liabilities   8,247,000     10,716,000  
 Current portion of long-term debt   6,000,000     5,893,000  
 Current portion of acquisition-related contigent liabilities 3,135,000     1,788,000  
          TOTAL CURRENT LIABILITIES   31,370,000     31,904,000  
           
LONG-TERM DEBT    34,454,000   36,227,000  
LONG-TERM PENSION LIABILITY   7,780,000   9,467,000  
LONG-TERM ACQUISITION-RELATED CONTINGENT LIABILITY 4,173,000   7,238,000  
OTHER LONG-TERM LIABILITIES   2,292,000   1,462,000  
COMMITMENTS AND CONTINGENCIES (NOTE 5)     
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 - 14,768,272 and  14,513,207, respectively. 15,000   15,000  
 Additional paid-in capital   44,701,000   42,416,000  
 Retained earnings     79,239,000   74,283,000  
 Accumulated other comprehensive income (loss), net of tax:     
  Pensions      (5,762,000)   (6,258,000) 
  Cash flow hedges     (159,000)   21,000  
  Foreign currency translation adjustment   80,000     73,000  
TOTAL SHAREHOLDERS' EQUITY   118,114,000   110,550,000  
        $198,183,000    $196,848,000  
           

 

 SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF CASH FLOWS
  
 SIX MONTHS ENDED JUNE 30,
 (Unaudited)
          
         
       2017  2016 
          
CASH FLOWS FROM OPERATING ACTIVITIES    
 Net income    $8,176,000    $5,750,000 
  Adjustments to reconcile net income to net cash provided by operating activities:    
  Depreciation and amortization 2,715,000   2,333,000 
  Provision for bad debts - accounts receivable 575,000   180,000 
  Share-based compensation expense 1,108,000   1,097,000 
  Deferred income tax benefit  (509,000) (69,000)
  Gain on sale of property, plant and equipment (1,018,000) - 
  Accretion of acquisition-related contingent liability 81,000   81,000 
          
  Changes in assets and liabilities, net of acquisition of business:    
   Accounts receivable - trade 552,000   (2,181,000)
   Accounts receivable - other 674,000   1,125,000 
   Inventories  1,632,000   653,000 
   Prepaid expenses and other current assets (1,353,000) (1,648,000)
   Other assets  (1,784,000) (353,000)
   Accounts payable  585,000   2,238,000 
   Other current liabilities  (2,808,000) (1,464,000)
   Long-term pension liability (894,000) 259,000 
   Other long-term liabilities 829,000   40,000 
  Net cash provided by operating activities  8,561,000   8,041,000 
          
 CASH FLOWS FROM INVESTING ACTIVITIES    
  Additions to property, plant and equipment  (2,004,000) (5,527,000)
  Proceeds from disposals of property, plant and equipment 2,810,000   - 
  Purchase of business net of acquired cash -  (15,252,000)
  Net cash provided by (used in) investing activities 806,000   (20,779,000)
        
 CASH FLOWS FROM FINANCING ACTIVITIES    
  Proceeds from long-term debt 72,422,000   90,514,000 
  Repayment of long-term debt (74,088,000) (71,138,000)
  Payment of cash dividends  (2,490,000) (2,270,000)
  Payment of contingent liability (1,800,000) (1,800,000)
  Proceeds received on exercise of stock options 798,000   781,000 
  Tax benefit from vesting of acquisition related restricted stock 70,000   535,000 
  Tax withholding on exercise of stock rights (421,000) (267,000)
          
 Net cash (used in) provided by financing activities (5,509,000) 16,355,000 
          
 Effect of currency exchange rates on cash 76,000   82,000 
          
 Net increase in cash and cash equivalents 3,934,000   3,699,000 
         
 Cash and cash equivalents balance, beginning of year 3,649,000   1,036,000 
          
 Cash and cash equivalents balance, end of period  $7,583,000    $4,735,000 
          

 


            

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