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Superior Uniform Group, Inc. Reports First Quarter Operating Results

  • Net Sales Increase 5.2% with Net Income up 57.0%
  • 18th Consecutive Quarter with Sales Increase

SEMINOLE, Fla., April 27, 2017 (GLOBE NEWSWIRE) -- Superior Uniform Group, Inc. (NASDAQ:SGC), manufacturer of uniforms, career apparel and accessories, today announced that for the first quarter ended March 31, 2017, net sales increased 5.2 percent to $61.0 million compared with 2016 first quarter net sales of $58.0 million. Net income for the 2017 first quarter was $3.8 million, or $0.26 per diluted share, compared with $2.4 million, or $0.17 per diluted share, reported for the quarter ended March 31, 2016.

Michael Benstock, Chief Executive Officer, commented, “We are pleased to report a 57 percent increase in net income despite falling slightly short of our own expectations for sales in the first quarter. Our sales growth was negatively impacted in the first quarter by several factors. Two factors were most prominent. First, one of our large customers was acquired by one of their competitors during 2016 which was serviced by a different uniform provider. As a result, they are in the process of transitioning their uniform program to the provider utilized by the acquiring company.

“We expect to complete this transition by the end of the second quarter. We have been and continue to work diligently to find ways to remain involved with this customer. Second, we saw several accounts push back significant programs into the second quarter whereas the prior year first quarter benefitted from customers pulling business forward into the first quarter. Sales growth was positively impacted by the inclusion of a full quarter of sales from BAMKO in the 2017 first quarter while the 2016 first quarter only included one month of sales following the March 1st effective date of the BAMKO acquisition.

Our pipeline is strong and our outlook remains positive in spite of all the noise and political distractions. Our teams remain focused on the long-term, and we continue to demonstrate our ability to make appropriate changes to our business model to increase shareholder value.”

CONFERENCE CALL

Superior Uniform Group will hold a conference call on Thursday, April 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 May 4, 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 10104432 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 INCOME
THREE MONTHS ENDED MARCH 31,
(Unaudited)
2017 2016
Net sales $60,987,000 $57,968,000
Costs and expenses:
Cost of goods sold 38,773,000 37,947,000
Selling and administrative expenses 17,643,000 16,463,000
Interest expense 184,000 148,000
56,600,000 54,558,000
Gain on sale of property, plant and equipment 1,018,000 -
Income before taxes on income 5,405,000 3,410,000
Income tax expense 1,570,000 968,000
Net income $3,835,000 $2,442,000
Weighted average number of shares outstanding during the period
(Basic) 14,350,721 13,927,063
(Diluted) 14,929,695 14,668,658
Per Share Data:
Basic
Net income $ 0.27 $ 0.18
Diluted
Net income $ 0.26 $ 0.17
Cash dividends per common share $ 0.0875 $ 0.0825

SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
March 31,
2017 December 31,
(Unaudited) 2016
CURRENT ASSETS:
Cash and cash equivalents $9,372,000 $3,649,000
Accounts receivable, less allowance for doubtful accounts
of $1,390,000 and $1,276,000, respectively 34,522,000 41,823,000
Accounts receivable - other 2,396,000 3,085,000
Inventories 70,308,000 69,240,000
Prepaid expenses and other current assets 9,113,000 7,214,000
TOTAL CURRENT ASSETS 125,711,000 125,011,000
PROPERTY, PLANT AND EQUIPMENT, NET 25,886,000 27,533,000
OTHER INTANGIBLE ASSETS, NET 22,668,000 23,238,000
GOODWILL 11,300,000 11,269,000
DEFERRED INCOME TAXES 7,065,000 6,800,000
OTHER ASSETS 4,520,000 2,997,000
$197,150,000 $196,848,000
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $12,779,000 $13,507,000
Other current liabilities 10,642,000 10,716,000
Current portion of long-term debt 6,000,000 5,893,000
Current portion of acquisition-related contingent liabilities - 1,788,000
TOTAL CURRENT LIABILITIES 29,421,000 31,904,000
LONG-TERM DEBT 35,962,000 36,227,000
LONG-TERM PENSION LIABILITY 8,270,000 9,467,000
LONG-TERM ACQUISITION-RELATED CONTINGENT LIABILITY 7,270,000 7,238,000
OTHER LONG-TERM LIABILITIES 2,158,000 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 - 14,616,631 and 14,513,207, respectively. 15,000 15,000
Additional paid-in capital 43,483,000 42,416,000
Retained earnings 76,637,000 74,283,000
Accumulated other comprehensive income (loss), net of tax:
Pensions (6,082,000) (6,258,000)
Cash flow hedges (107,000) 21,000
Foreign Currency translation adjustment 123,000 73,000
TOTAL SHAREHOLDERS' EQUITY 114,069,000 110,550,000
$197,150,000 $196,848,000

SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months Ended March 31,
(Unaudited)
2017 2016
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $3,835,000 $2,442,000
Adjustments to reconcile net income
to net cash provided by (used in) operating activities:
Depreciation and amortization 1,358,000 1,103,000
Provision for bad debts - accounts receivable 146,000 67,000
Share-based compensation expense 842,000 877,000
Deferred income tax benefit (320,000) (479,000)
Gain on sale of property, plant and equipment (1,018,000) -
Accretion of acquisition-related contingent liability 44,000 35,000
Changes in assets and liabilities:
Accounts receivable - trade 7,164,000 (3,650,000)
Accounts receivable - other 689,000 (43,000)
Inventories (1,078,000) 1,001,000
Prepaid expenses and other current assets (1,892,000) (184,000)
Other assets (1,522,000) (281,000)
Accounts payable (590,000) (1,833,000)
Other current liabilities (426,000) (2,291,000)
Long-term pension liability (920,000) 485,000
Other long-term liabilities 696,000 20,000
Net cash provided by (used in) operating activities 7,008,000 (2,731,000)
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property, plant and equipment (930,000) (2,707,000)
Proceeds from disposals of property, plant and equipment 2,808,000 -
Purchase of business net of acquired cash - (15,252,000)
Net cash provided by (used in) investing activities 1,878,000 (17,959,000)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long-term debt 71,209,000 74,363,000
Repayment of long-term debt (71,367,000) (50,250,000)
Payment of cash dividends (1,231,000) (1,133,000)
Payment of contingent liability (1,800,000) (1,800,000)
Proceeds received on exercise of stock options 105,000 322,000
Tax benefit from vesting of acquisition related restricted stock 70,000 535,000
Tax withholding on exercise of stock rights (201,000) (124,000)
Net cash provided by (used in) financing activities (3,215,000) 21,913,000
Effect of currency exchange rates on cash 52,000 30,000
Net increase in cash and cash equivalents 5,723,000 1,253,000
Cash and cash equivalents balance, beginning of year 3,649,000 1,036,000
Cash and cash equivalents balance, end of period $9,372,000 $2,289,000

Andrew D. Demott, Jr. COO, CFO & Treasurer (727) 803-7135 OR Hala Elsherbini, Halliburton Investor Relations (972) 458-8000

Source:Superior Uniform Group, Inc.