SUPERIOR GROUP OF COMPANIES, INC. REPORTS OPERATING RESULTS FOR THE FOURTH QUARTER AND YEAR ENDED DECEMBER 31, 2018
- ANNUAL NET SALES INCREASED 30 PERCENT
- ANNUAL NET INCOME INCREASED 13 PERCENT
- 25TH CONSECUTIVE QUARTER WITH SALES INCREASE
SEMINOLE, Fla. – February 21, 2019 – Superior Group of Companies, Inc. (NASDAQ: SGC), today announced its fourth quarter and year-end operating results for 2018.
The Company announced that for the year ended December 31, 2018, net sales increased 29.8 percent to $346.4 million, compared to 2017 net sales of $266.8 million. Income before taxes on income was $21.4 million compared to $24.8 million in 2017. Net income for the fiscal year 2018 increased 13.0% to $17.0 million, or $1.10 per diluted share, compared to $15.0 million, or $0.99 per diluted share, reported in 2017. Net income for 2018 was reduced by approximately $2.0 million ($0.13 per diluted share) of direct expenses associated with the May 2nd acquisition of CID Resources.
Net sales for the fourth quarter ended December 31, 2018 increased 31.1 percent to $95.0 million, compared to 2017 fourth quarter net sales of $72.4 million. Income before taxes on income was $5.7 million compared to $6.8 million in the 2017 fourth quarter. Net income for the fourth quarter ended December 31, 2018 was $4.6 million, or $0.30 per diluted share, compared to $1.9 million, or $0.12 per diluted share, reported for the fourth quarter 2017. Fourth quarter 2017 net income was reduced by approximately $4.0 million, or $0.26 per diluted share, associated with the enactment of the Tax Cuts and Jobs Act.
Michael Benstock, Chief Executive Officer, commented, “While the fourth quarter performance of our uniform segment was below our expectations, we’ve made tremendous progress on the integration of our uniform businesses within our Superior Group of Companies. We are aggressively developing avenues to leverage our expanded product assortment and service lines within the segment to meet and exceed our existing customers’ expectations and to gain market share. We are also on schedule with the integration of our ERP systems that, once completed, will allow us to maximize cost efficiencies throughout our operations. I’m quite satisfied with our progress in these areas and am confident in the overall trajectory of our uniform business as we enter 2019.
I’m particularly pleased with the performance of BAMKO and The Office Gurus. During the fourth quarter, BAMKO, our Promotional Products segment, posted strong organic net sales growth of 32 percent, and total net sales within the segment grew 68 percent to $24 million. The Office Gurus, our Remote Staffing segment, continues to outperform our expectations with quarterly net sales growth to outside customers of 22 percent.”
On January 22, 2019, the Company restructured its Amended and Restated Credit Agreement (Term Loan) entered into on May 2, 2018 with our incumbent lender. The restructuring reduced the principal amount of the Term Loan to $65 million, by using $20 million of proceeds under our revolving credit facility; extended the maturity from May 2020 to January 2026; and lowered the variable interest rate to LIBOR plus 85 basis points. Principal and interest payments are due monthly through its maturity.
Michael Attinella, Chief Financial Officer of Superior Group of Companies, commented, “We are quite pleased with the restructuring of the Term Loan. We were able to lower our interest rate and other costs of debt while maintaining repayment flexibility and extending its term. We are confident that the combined cash flow from operations and liquidity provided from the revolving credit facility is more than ample to fund our strategic plan as we move into 2019 and beyond.”
Superior Group of Companies will hold a conference call on Thursday, February 21, 2019 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 Group of Companies call. The live webcast and archived replay can also be accessed in the investor information section of the Company’s website at www.superiorgroupofcompanies.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 February 28, 2019. 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 10128748 for all replay access.
ABOUT SUPERIOR GROUP OF COMPANIES, INC. (SGC):
Superior Group of Companies™, formerly Superior Group of Companies, established in 1920, is a combination of companies that help customers unlock the power of their brands by creating extraordinary brand experiences for employees and customers. It provides customized support for each of its divisions through its shared services model.
Fashion Seal Healthcare®, HPI™ and CID Resources are signature uniform brands of Superior Group of Companies. Each is one of America’s leading providers of uniforms and image apparel in the markets it serves. They specialize in innovative uniform program design, global manufacturing, and state-of-the-art
distribution. Every day, more than 6 million Americans go to work wearing a uniform from Superior Group of Companies.
BAMKO®, Tangerine Promotions® and Public Identity® are signature promotional products and branded merchandise brands of Superior Group of Companies. They provide unique custom branding, design, sourcing, and marketing solutions to some of the world’s most successful brands.
The Office Gurus® is a global provider of custom call and contact center support. As a true strategic partner, The Office Gurus implements customized solutions for its customers in order to accelerate their growth and improve their customers’ service experiences.
SGC’s commitment to service, technology, quality and value-added benefits, as well as its financial strength and resources, provides unparalleled support for its customers’ diverse needs while embracing a “Customer 1st, Every Time!” philosophy and culture in all of its business segments.
Visit www.superiorgroupofcompanies.com for more information.
Chief Financial Officer & Treasurer
Halliburton Investor Relations