[10-Q] SUPERIOR GROUP OF COMPANIES, INC. Quarterly Earnings Report
Superior Group of Companies (SGC) reported softer Q3 2025 results. Net sales were $138.5 million versus $149.7 million a year ago, and net income was $2.7 million versus $5.4 million. Diluted EPS was $0.18. The consolidated gross margin rate was 38.3% compared to 40.4% last year.
All three segments declined year over year: Branded Products net sales were $85.1 million (down $7.5 million), Healthcare Apparel $31.5 million (down $1.5 million), and Contact Centers $22.7 million (down $2.4 million). EBITDA was $7.5 million versus $11.7 million. The company cited timing of orders, customer mix, and macro headwinds, including the closure of its Jamaica contact center.
On the balance sheet, total debt was $100.0 million, including a $40.0 million revolver and a $60.5 million term loan, with a 5.4% weighted average interest rate as of September 30, 2025. Inventory was $105.7 million. Cash dividends were $0.14 per share in the quarter. Shares outstanding were 15,968,792 as of October 30, 2025. Management noted tariff exposures and the expiration of certain U.S. trade preferences as continuing risks.
- None.
- None.
Insights
Q3 revenue and earnings declined; margins compressed.
SGC posted Q3 net sales of
EBITDA was
Key dependencies include segment demand recovery, tariff cost pass-through, and execution on the repurchase plan announced under the
| UNITED STATES |
| SECURITIES AND EXCHANGE COMMISSION |
| WASHINGTON, D.C. 20549 |
| FORM |
| (Mark One) |
| QUARTERLY REPORT PURSUANT TO SECTION 13 or 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||||
| For the quarterly period ended | |||||||
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||||
| For the transition period from ________ to __________ |
| Commission file number: |
| Exact name of registrant as specified in its charter: |
| SUPERIOR GROUP OF COMPANIES, INC. |
| State or other jurisdiction of incorporation or organization: | I.R.S. Employer Identification No.: |
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| Address of principal executive offices: | ||||||||
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| Registrant’s telephone number, including area code: | ||||||||
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| Former name, former address and former fiscal year, if changed since last report: |
| Securities registered pursuant to Section 12(b) of the Act: |
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
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Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
| Large accelerated filer ☐ | |
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| Non-accelerated filer ☐ |
| Smaller Reporting Company | |
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| 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. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes
The number of shares of common stock of the registrant outstanding as of October 30, 2025 was
TABLE OF CONTENTS
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Page |
| PART I. FINANCIAL INFORMATION |
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| Item 1. Financial Statements |
4 |
| Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations |
19 |
| Item 4. Controls and Procedures |
32 |
| PART II. OTHER INFORMATION |
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| Item 1. Legal Proceedings |
33 |
| Item 1A. Risk Factors |
33 |
| Item 2. Unregistered Sales of Equity Securities and Use of Proceeds |
34 |
| Item 3. Defaults Upon Senior Securities |
34 |
| Item 4. Mine Safety Disclosures |
34 |
| Item 5. Other Information |
34 |
| Item 6. Exhibits |
35 |
| SIGNATURES |
36 |
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Page |
| Financial Statements |
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| Consolidated Statements of Comprehensive Income (Unaudited) |
4 |
| Consolidated Balance Sheets (Unaudited) | 5 |
| Consolidated Statements of Shareholders’ Equity (Unaudited) |
6 |
| Consolidated Statements of Cash Flows (Unaudited) |
8 |
| Condensed Notes to the Consolidated Financial Statements (Unaudited) | |
| Note 1 - Description of Business and Basis of Presentation |
9 |
| Note 2 - Operating Segment Information | 11 |
| Note 3 - Net Sales | 13 |
| Note 4 - Net Income Per Share | 14 |
| Note 5 - Long-Term Debt | 15 |
| Note 6 - Contingencies and Geographic Supply Considerations | 16 |
| Note 7 - Inventories | 16 |
| Note 8 - Income Taxes | 17 |
| Note 9 - Other Information | 18 |
PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements
| SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES |
| CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME |
| (Unaudited) |
| (In thousands, except shares and per share data) |
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Net sales | $ | $ | $ | $ | ||||||||||||
| Costs and expenses: | ||||||||||||||||
| Cost of goods sold | ||||||||||||||||
| Selling and administrative expenses | ||||||||||||||||
| Interest expense, net | ||||||||||||||||
| Income before income tax expense | ||||||||||||||||
| Income tax expense | ||||||||||||||||
| Net income | $ | $ | $ | $ | ||||||||||||
| Net income per share: | ||||||||||||||||
| Basic | $ | $ | $ | $ | ||||||||||||
| Diluted | $ | $ | $ | $ | ||||||||||||
| Weighted average shares outstanding during the period: | ||||||||||||||||
| Basic | ||||||||||||||||
| Diluted | ||||||||||||||||
| Other comprehensive income (loss), net of tax: | ||||||||||||||||
| Defined benefit pension plans | $ | $ | $ | $ | ||||||||||||
| Foreign currency translation adjustment | ( | ) | ( | ) | ||||||||||||
| Other comprehensive income (loss) | ( | ) | ( | ) | ||||||||||||
| Comprehensive income | $ | $ | $ | $ | ||||||||||||
| Cash dividends per common share | $ | $ | $ | $ | ||||||||||||
See accompanying Condensed Notes to the Consolidated Financial Statements.
| SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES |
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| CONSOLIDATED BALANCE SHEETS |
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| (In thousands, except shares and par value data) |
| September 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| (Unaudited) | ||||||||
| ASSETS | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | $ | ||||||
| Accounts receivable, net | ||||||||
| Inventories | ||||||||
| Contract assets | ||||||||
| Prepaid expenses and other current assets | ||||||||
| Total current assets | ||||||||
| Property, plant and equipment, net | ||||||||
| Operating lease right-of-use assets | ||||||||
| Deferred tax asset | ||||||||
| Intangible assets, net | ||||||||
| Goodwill | ||||||||
| Other assets | ||||||||
| Total assets | $ | $ | ||||||
| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | $ | ||||||
| Other current liabilities | ||||||||
| Current portion of long-term debt | ||||||||
| Current portion of acquisition-related contingent liabilities | ||||||||
| Total current liabilities | ||||||||
| Long-term debt | ||||||||
| Long-term pension liability | ||||||||
| Long-term acquisition-related contingent liabilities | ||||||||
| Long-term operating lease liabilities | ||||||||
| Other long-term liabilities | ||||||||
| Total liabilities | ||||||||
| Commitments and contingencies (Note 6) | ||||||||
| 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 15,968,792 and 16,484,921 shares, respectively | ||||||||
| Additional paid-in capital | ||||||||
| Retained earnings | ||||||||
| Accumulated other comprehensive loss, net of tax: | ( | ) | ( | ) | ||||
| Total shareholders’ equity | ||||||||
| Total liabilities and shareholders’ equity | $ | $ | ||||||
| See accompanying Condensed Notes to the Consolidated Financial Statements. |
| SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES |
| CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY |
| THREE MONTHS ENDED September 30, 2025 AND 2024 |
| (Unaudited) |
| (In thousands, except shares and per share data) |
| Accumulated | ||||||||||||||||||||||||
| Other | ||||||||||||||||||||||||
| Additional | Comprehensive | Total | ||||||||||||||||||||||
| Common | Common | Paid-In | Retained | Income (Loss), | Shareholders’ | |||||||||||||||||||
| Shares | Stock | Capital | Earnings | net of tax | Equity | |||||||||||||||||||
| Balance, July 1, 2024 | $ | $ | $ | $ | ( | ) | $ | |||||||||||||||||
| Issuance of common stock under stock incentive plans and related tax effect | ||||||||||||||||||||||||
| Common shares repurchased and retired | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||
| Share-based compensation expense | - | |||||||||||||||||||||||
| Cash dividends declared ($0.14 per share) | - | ( | ) | ( | ) | |||||||||||||||||||
| Comprehensive income (loss): | ||||||||||||||||||||||||
| Net income | - | |||||||||||||||||||||||
| Pensions, net of taxes of $8 | - | |||||||||||||||||||||||
| Change in currency translation adjustment, net of taxes of $0 | - | |||||||||||||||||||||||
| Balance, September 30, 2024 | $ | $ | $ | $ | ( | ) | $ | |||||||||||||||||
| Balance, July 1, 2025 | $ | $ | $ | $ | ( | ) | $ | |||||||||||||||||
| Issuance of common stock under stock incentive plans and related tax effect | ( | ) | ( | ) | ||||||||||||||||||||
| Common shares repurchased and retired | ( | ) | ( | ) | ( | ) | ||||||||||||||||||
| Share-based compensation expense | - | |||||||||||||||||||||||
| Cash dividends declared ($0.14 per share) | - | ( | ) | ( | ) | |||||||||||||||||||
| Comprehensive income (loss): | ||||||||||||||||||||||||
| Net income | - | |||||||||||||||||||||||
| Pensions, net of taxes of $2 | - | |||||||||||||||||||||||
| Change in currency translation adjustment, net of taxes of $0 | - | ( | ) | ( | ) | |||||||||||||||||||
| Balance, September 30, 2025 | $ | $ | $ | $ | ( | ) | $ | |||||||||||||||||
SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
nine MONTHS ENDED September 30, 2025 AND 2024
(Unaudited)
(In thousands, except shares and per share data)
| Accumulated | ||||||||||||||||||||||||
| Other | ||||||||||||||||||||||||
| Additional | Comprehensive | Total | ||||||||||||||||||||||
| Common | Common | Paid-In | Retained | Income (Loss), | Shareholders’ | |||||||||||||||||||
| Shares | Stock | Capital | Earnings | net of tax | Equity | |||||||||||||||||||
| Balance, January 1, 2024 | $ | $ | $ | $ | ( | ) | $ | |||||||||||||||||
| Issuance of common stock under stock incentive plans and related tax effect | ( | ) | ||||||||||||||||||||||
| Common shares repurchased and retired | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||||
| Share-based compensation expense | - | |||||||||||||||||||||||
| Written put options | - | |||||||||||||||||||||||
| Cash dividends declared ($0.42 per share) | - | ( | ) | ( | ) | |||||||||||||||||||
| Comprehensive income (loss): | ||||||||||||||||||||||||
| Net income | - | |||||||||||||||||||||||
| Pensions, net of taxes of $23 | - | |||||||||||||||||||||||
| Change in currency translation adjustment, net of taxes of $0 | - | ( | ) | ( | ) | |||||||||||||||||||
| Balance, September 30, 2024 | $ | $ | $ | $ | ( | ) | $ | |||||||||||||||||
| Balance, January 1, 2025 | $ | $ | $ | $ | ( | ) | $ | |||||||||||||||||
| Issuance of common stock under stock incentive plans and related tax effect | ||||||||||||||||||||||||
| Common shares repurchased and retired | ( | ) | ( | ) | ( | ) | ( | ) | ( | ) | ||||||||||||||
| Share-based compensation expense | - | |||||||||||||||||||||||
| Cash dividends declared ($0.42 per share) | - | ( | ) | ( | ) | |||||||||||||||||||
| Comprehensive income (loss): | ||||||||||||||||||||||||
| Net income | - | |||||||||||||||||||||||
| Pensions, net of taxes of $7 | - | |||||||||||||||||||||||
| Change in currency translation adjustment, net of taxes of $0 | - | |||||||||||||||||||||||
| Balance, September 30, 2025 | $ | $ | $ | $ | ( | ) | $ | |||||||||||||||||
| See accompanying Condensed Notes to the Consolidated Financial Statements. |
| SUPERIOR GROUP OF COMPANIES, INC. AND SUBSIDIARIES |
| CONSOLIDATED STATEMENTS OF CASH FLOWS |
| (Unaudited) |
| (In thousands) |
| Nine Months Ended September 30, |
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| 2025 |
2024 |
|||||||
| CASH FLOWS FROM OPERATING ACTIVITIES |
||||||||
| Net income |
$ | $ | ||||||
| Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||
| Depreciation and amortization |
||||||||
| Inventory write-downs |
||||||||
| Credit loss expense |
||||||||
| Share-based compensation expense |
||||||||
| Change in fair value of acquisition-related contingent liabilities |
||||||||
| Non-cash operating lease expense |
||||||||
| Other, net |
||||||||
| Changes in assets and liabilities, net of acquisition of a business: |
||||||||
| Accounts receivable |
( |
) | ||||||
| Contract assets |
( |
) | ||||||
| Inventories |
( |
) | ||||||
| Prepaid expenses and other current assets |
( |
) | ( |
) | ||||
| Other assets |
( |
) | ( |
) | ||||
| Accounts payable and other current liabilities |
( |
) | ( |
) | ||||
| Payment of acquisition-related contingent liabilities |
( |
) | ( |
) | ||||
| Other long-term liabilities |
||||||||
| Net cash provided by operating activities |
||||||||
| CASH FLOWS FROM INVESTING ACTIVITIES |
||||||||
| Additions to property, plant and equipment |
( |
) | ( |
) | ||||
| Net cash used in investing activities |
( |
) | ( |
) | ||||
| CASH FLOWS FROM FINANCING ACTIVITIES |
||||||||
| Borrowings under revolving lines of credit |
||||||||
| Payments under revolving lines of credit |
( |
) | ( |
) | ||||
| Payments of term loan |
( |
) | ( |
) | ||||
| Payment of cash dividends |
( |
) | ( |
) | ||||
| Payment of acquisition-related contingent liabilities |
( |
) | ( |
) | ||||
| Proceeds received on exercise of stock options and payments for shares withheld for taxes |
||||||||
| Common shares repurchased and retired |
( |
) | ( |
) | ||||
| Net cash used in financing activities |
( |
) | ( |
) | ||||
| Effect of currency exchange rates on cash |
( |
) | ||||||
| Net decreases in cash and cash equivalents |
( |
) | ( |
) | ||||
| Cash and cash equivalents balance, beginning of period |
||||||||
| Cash and cash equivalents balance, end of period |
$ | $ | ||||||
| See accompanying Condensed Notes to the Consolidated Financial Statements. |
Superior Group of Companies, Inc. and Subsidiaries
Condensed Notes to the Consolidated Financial Statements (Unaudited)
NOTE 1 – Description of Business and Basis of Presentation:
Description of business
Superior Group of Companies, Inc. (together with its subsidiaries, “the Company,” “Superior,” “we,” “our,” or “us”) was organized in 1920 and was incorporated in 1922 as a New York company under the name Superior Surgical Mfg. Co., Inc. In 1998, the Company changed its name to Superior Uniform Group, Inc. and redomiciled to Florida. Effective on May 3, 2018, Superior Uniform Group, Inc. changed its name to Superior Group of Companies, Inc.
Superior’s Branded Products segment, primarily through its signature marketing brands BAMKO® and HPI®, produces and sells customized merchandising solutions, promotional products and branded uniform programs. Branded products are manufactured through third parties or in Superior’s own facilities, and are sold to customers in a wide range of industries, including retail chain, food service, entertainment, technology, transportation and other industries. The segment currently has sales offices or operations in the United States, Canada and Brazil, with support services in China and India.
Superior’s Healthcare Apparel segment, primarily through its portfolio of brands Wink®, Fashion Seal Healthcare®, its trade name CID Resources and our license of Carhartt Medical, manufactures (through third parties or in its own facilities) and sells a wide range of healthcare apparel, such as scrubs, lab coats, protective apparel and patient apparel. This segment sells its products to healthcare laundries, dealers, distributors, retailers and consumers primarily in the United States.
Superior’s Contact Centers segment, through multiple The Office Gurus® entities, including subsidiaries in El Salvador, Belize, Dominican Republic, the United States and in Jamaica until its closure on June 15, 2025, provides outsourced, nearshore business process outsourcing, contact and call-center support services to North American customers.
Basis of presentation
The accompanying unaudited consolidated financial statements of Superior included herein have been prepared in accordance with generally accepted accounting principles in the United States of America ("GAAP") and the rules and regulations of the Securities and Exchange Commission (the "SEC"). Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations. Intercompany items have been eliminated in consolidation. These consolidated financial statements should be read in conjunction with the audited financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, and filed with the SEC. Management believes that the information furnished includes all adjustments of a normal recurring nature that are necessary to fairly present our consolidated financial position, results of operations and cash flows for the periods indicated. The results of operations for any interim period are not necessarily indicative of results to be expected for the full year.
The Company refers to the consolidated financial statements collectively as “financial statements,” and individually as “statements of comprehensive income,” “balance sheets,” “statements of shareholders’ equity,” and “statements of cash flows” herein.
Change in Accounting Policy
The Company historically evaluated goodwill and indefinite-lived intangible assets for impairment during the fourth quarter or when an indicator of impairment existed. During the third quarter of 2025, the Company voluntarily changed its date of the annual goodwill impairment assessment for all of its reporting units as well as its indefinite-lived intangible assets to August 31st. Historically the annual test was performed during the fourth quarter. The Company changed the date to provide timelier information for planning and forecasting purposes and provide additional time to complete the required impairment testing. The change did not represent a material change to the Company’s method of applying the accounting principle and was not retrospectively applied because the Company did not carry a goodwill balance in 2024 prior to the fourth quarter of 2024. No impairments were identified during the third quarter 2025 annual goodwill and indefinite-lived intangible impairment tests.
Reclassifications
The accompanying financial statements for the prior year period contain certain reclassifications. Reclassifications impact items within our statements of comprehensive income, our statements of shareholders' equity, our statements of cash flows and Note 7 Inventories. These reclassifications did not have an effect on the Company’s consolidated results of operations, financial position or cash flows for the quarter ended September 30, 2025.
Recently Issued Accounting Pronouncements Not Yet Adopted
In December 2023, the FASB issued ASU 2023-09, "Income Taxes (Topic 740)—Improvements to Income Tax Disclosures". The ASU requires that an entity disclose specific categories in the effective tax rate reconciliation as well as provide additional information for reconciling items that meet a quantitative threshold. Further, the ASU requires certain disclosures of state versus federal income tax expense and taxes paid. Early adoption is permitted for annual financial statements that have not yet been issued. The amendments should be applied on a prospective basis although retrospective application is permitted. The Company will adopt the required disclosures in its annual financial statements as of December 31, 2025. The adoption of this guidance will not affect the Company’s consolidated results of operations, financial position or cash flows.
In November 2024, the FASB issued ASU 2024-03, “Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses“. The ASU requires the disclosure of additional information about specific categories of costs and expenses in the notes to the consolidated financial statements. This guidance is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. Early adoption is permitted. This ASU will likely result in additional disclosures. We are currently evaluating the provisions of this ASU.
In July 2025, the FASB issued ASU 2025-05, "Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets". The FASB issued ASU 2025-05 to simplify the application of the current expected credit loss (CECL) model to short-term receivables and contract assets under ASC 606. The amendments introduce a practical expedient (available to all entities) that allows companies to assume current conditions as of the balance sheet date remain unchanged for the life of the asset, removing the need to incorporate complex macroeconomic forecasts for short-term assets. The scope includes current accounts receivable and contract assets arising from Topic 606, including those acquired in business combinations. The amendments are effective for annual periods beginning after December 15, 2025 (interim periods included), with prospective application and early adoption permitted. We are currently evaluating the provisions of this ASU.
NOTE 2 – Operating Segment Information:
The Company manages and reports the following segments:
Branded Products segment: Primarily through our signature marketing brands BAMKO® and HPI®, we produce and sell customized merchandising solutions, promotional products and branded uniform programs. Branded products are sold to customers in a wide range of industries, including retail chain, food service, entertainment, technology, transportation and other industries. The segment currently has sales offices in the United States and Brazil, with support services in China and India.
Healthcare Apparel segment: Primarily through our portfolio of brands Wink®, Fashion Seal Healthcare®, its trade name CID Resources and our license of Carhartt Medical, we manufacture (through third parties or in our own facilities) and sell a wide range of healthcare apparel, such as scrubs, lab coats, protective apparel and patient apparel. This segment sells its products to healthcare laundries, dealers, distributors and retailers primarily in the United States.
Contact Centers: Through multiple The Office Gurus® entities, including our subsidiaries in El Salvador, Belize, Dominican Republic, the United States and Jamaica until its closure on June 15, 2025, we provide outsourced, nearshore business process outsourcing, contact and call-center support services to North American customers.
Intersegment eliminations include the elimination of revenues and costs from services provided by the Contact Centers segment to the Company’s two other segments. Such costs are recognized as selling and administrative expenses in the Branded Products and Healthcare Apparel segments. Income and expenses related to corporate functions that are not specifically attributable to an individual reportable segment are presented within Other in the table below.
The chief operating decision maker, who is the Company’s Chief Executive Officer, evaluates the performance of our segments. Segment EBITDA is the profitability metric reported to the Company’s CODM for purposes of making decisions about allocation of resources to, and assessing performance of, each reportable segment. Segment EBITDA is calculated as net sales less cost of goods sold and selling and administrative expenses. Segment information for total assets is not presented as this information is not used by the Company’s CODM in measuring segment performance or allocating resources between segments.
The following tables set forth financial information related to the Company’s operating segments (in thousands):
| Branded Products | Healthcare Apparel | Contact Centers | Intersegment Eliminations | Other | Total | |||||||||||||||||||
| For the Three Months Ended September 30, 2025: | ||||||||||||||||||||||||
| Net sales | $ | $ | $ | $ | ( | ) | $ | $ | ||||||||||||||||
| Cost of goods sold | ( | ) | ||||||||||||||||||||||
| Gross margin | ( | ) | ||||||||||||||||||||||
| Selling and administrative expenses | ( | ) | ||||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||||||
| Segment EBITDA | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||
| Branded Products | Healthcare Apparel | Contact Centers | Intersegment Eliminations | Other | Total | |||||||||||||||||||
| For the Three Months Ended September 30, 2024: | ||||||||||||||||||||||||
| Net sales | $ | $ | $ | $ | ( | ) | $ | $ | ||||||||||||||||
| Cost of goods sold | ( | ) | ||||||||||||||||||||||
| Gross margin | ( | ) | ||||||||||||||||||||||
| Selling and administrative expenses | ( | ) | ||||||||||||||||||||||
| Impairment charge | ||||||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||||||
| Segment EBITDA | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||
| Branded Products | Healthcare Apparel | Contact Centers | Intersegment Eliminations | Other | Total | |||||||||||||||||||
| For the Nine Months Ended September 30, 2025: | ||||||||||||||||||||||||
| Net sales | $ | $ | $ | $ | ( | ) | $ | $ | ||||||||||||||||
| Cost of goods sold | ( | ) | ||||||||||||||||||||||
| Gross margin | ( | ) | ||||||||||||||||||||||
| Selling and administrative expenses | ( | ) | ||||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||||||
| Segment EBITDA | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||
| Branded Products | Healthcare Apparel | Contact Centers | Intersegment Eliminations | Other | Total | |||||||||||||||||||
| For the Nine Months Ended September 30, 2024: | ||||||||||||||||||||||||
| Net sales | $ | $ | $ | $ | ( | ) | $ | $ | ||||||||||||||||
| Cost of goods sold | ( | ) | ||||||||||||||||||||||
| Gross margin | ( | ) | ||||||||||||||||||||||
| Selling and administrative expenses | ( | ) | ||||||||||||||||||||||
| Impairment charge | ||||||||||||||||||||||||
| Depreciation and amortization | ||||||||||||||||||||||||
| Segment EBITDA | $ | $ | $ | $ | $ | ( | ) | $ | ||||||||||||||||
The following table reconciles income before income tax expense to Segment EBITDA (in thousands):
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2025 | 2024 | 2025 | 2024 | |||||||||||||
| Income before income tax expense | $ | $ | $ | $ | ||||||||||||
| Interest expense | ||||||||||||||||
| Depreciation and amortization | ||||||||||||||||
| Impairment charge | ||||||||||||||||
| Segment EBITDA | $ | $ | $ | $ | ||||||||||||
NOTE 3 – Net Sales:
For our Branded Products and Healthcare Apparel segments, revenue is primarily generated from the sale of finished products to customers. Revenues for our Branded Products and Healthcare Apparel segments are recognized when the performance obligations under the contract terms are satisfied. For certain contracts with customers in which the Company has an enforceable right to payment for goods with no alternative use, revenue is recognized over time upon receipt of finished goods into inventory. Revenue for goods that do have an alternative use or that the customer is not obligated to purchase under the terms of a contract is generally recognized when the goods are transferred to the customer. The Company includes shipping and handling fees billable to customers in net sales. Shipping and handling activities that occur after the transfer of promised goods are accrued as control is transferred to the customer rather than being treated as a separate performance obligation.
For our Contact Centers segment, revenue is generated from providing our customers with contact center services. Revenue for our Contact Centers segment is recognized as services are delivered.
Revenue is measured at the amount of consideration we expect to receive in exchange for the goods or services. Variable consideration for estimated returns, allowances and other price variances is recorded based upon historical experience and current allowance programs. Contract terms may involve variable consideration clauses such as sales discounts and customer rebates, and revenue is adjusted accordingly for these provisions. Estimated amounts are included in the transaction price to the extent it is probable that a significant reversal of cumulative revenue recognized will not occur when the uncertainty associated with the variable consideration is resolved. The promised amount of consideration in a contract is not adjusted for the effects of a significant financing component when we expect, at contract inception, that the period between our transfer of a promised good or service to a customer and when the customer pays for that product or service will be one year or less. Sales taxes are excluded from the measurement of a performance obligation’s transaction price. Sales commissions are expensed as incurred when we expect that the amortization period of such costs will be one year or less.
For further information regarding our net sales disaggregated by reportable segment see Note 2.
The Company recognizes revenue when the customer takes control of the inventory, either upon shipment or when the material is made available for pick up. If the customer is deemed to take control of the inventory prior to pick up, the Company recognizes the revenue as a bill-and-hold transaction in accordance with Topic 606. Sales under bill-and-hold arrangements totaled $
Contract Assets and Contract Liabilities
The following table provides information about accounts receivable, contract assets and contract liabilities from contracts with customers (in thousands):
| September 30, |
December 31, |
|||||||
| 2025 |
2024 |
|||||||
| Accounts receivable |
$ | $ | ||||||
| Current contract assets |
||||||||
| Current contract liabilities |
||||||||
Contract assets relate to goods produced without an alternative use for which the Company has an enforceable right to payment but which has not yet been invoiced to the customer. Contract liabilities relate to payments received in advance of the Company completing its performance under a contract. Contract liabilities are included in other current liabilities in our balance sheets. During the nine months ended September 30, 2025, $
NOTE 4 – Net Income Per Share:
The Company’s basic net income per share is computed based on the weighted average number of shares of common stock outstanding for the period. Diluted net income per share includes the effect of the Company’s outstanding stock options, stock appreciation rights, nonvested shares of restricted stock and nonvested performance shares, if the inclusion of these items is dilutive.
The following table presents a reconciliation of basic and diluted net income per share for the periods presented:
| Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
| 2025 |
2024 |
2025 |
2024 |
|||||||||||||
| Net income used in the computation of basic and diluted net income per share (in thousands) |
$ | $ | $ | $ | ||||||||||||
| Weighted average shares outstanding - basic |
||||||||||||||||
| Dilutive common stock equivalents |
||||||||||||||||
| Weighted average shares outstanding - diluted |
||||||||||||||||
| Net income per share: |
||||||||||||||||
| Basic |
$ | $ | $ | $ | ||||||||||||
| Diluted |
$ | $ | $ | $ | ||||||||||||
Awards to purchase
Awards to purchase
NOTE 5 – Long-Term Debt:
Debt consisted of the following (in thousands):
| September 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| Credit Facilities: | ||||||||
| Revolving credit facility due August 2027 | $ | $ | ||||||
| Term loan due August 2027 | ||||||||
| Less: unamortized debt issuance costs | ( | ) | ( | ) | ||||
| Total Debt | $ | $ | ||||||
| Less: | ||||||||
| Current portion of long-term debt | ||||||||
| Long-term debt less current maturities | $ | $ | ||||||
On August 23, 2022, the Company entered into a Credit Agreement (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 (the “Administrative Agent”), pursuant to which the Lenders are providing the Company senior secured credit facilities maturing in August 2027 consisting of a revolving credit facility in the aggregate maximum principal amount of $
Obligations outstanding under the Credit Facilities accrue interest at a variable rate equal to the secured overnight financing rate ("SOFR") plus an adjustment between
Contractual principal payments for the term loan, which does not contain pre-payment penalties, are as follows: remainder of 2025 - $
The Credit Facilities are secured by substantially all of the operating assets of the Company, and the Company’s obligations under the Credit Facilities are guaranteed by all of its domestic subsidiaries. The Company’s obligations under the Credit Facilities are subject to acceleration upon the occurrence of an event of default as defined in the Credit Agreement. The Credit Agreement contains customary events of default and negative covenants, including but not limited to those governing indebtedness, liens, fundamental changes, investments, restricted payments (including dividends and related distributions), liquidations, mergers, consolidations or acquisitions, affiliate transactions and sales of assets or subsidiaries. The Credit Agreement also requires the Company to comply with a fixed charge coverage ratio of at least
NOTE 6 – Contingencies and Geographic Supply Concentrations:
Contingencies
The purchase price to acquire substantially all of the assets of Guardian Products, Inc. (“Guardian”) in May 2022 included contingent consideration based on varying levels of Guardian’s EBITDA in each measurement period through April 2025. In the third quarter of 2025 the final contingent consideration payment was made totaling $
The purchase price to acquire substantially all of the assets of 3Point in December 2024 included contingent consideration based on varying levels of the acquired company’s EBITDA in each measurement period through December 2027. The estimated fair value of the acquired company's acquisition-related contingent consideration payable as of September 30, 2025 was $
The Company is involved in various legal actions and claims arising from the normal course of business. The ultimate outcome of these matters is not expected to have a material impact on the Company’s results of operations, cash flows, or financial position.
Geographic Concentrations in the Available Supply of Materials and Product
The principal fabrics used in the manufacture of finished apparel goods for Superior’s Branded Products and Healthcare Apparel segments are cotton, polyester, spandex, cotton-synthetic and poly-synthetic blends. The majority of such fabrics are sourced, directly or indirectly, from China.
The Company does not have a concentration of suppliers of finished apparel in any single country or region of the world, however, it does contract to manufacture or source the majority of its apparel in the following countries: Haiti, China, Madagascar, Vietnam, Pakistan, Bangladesh, and the United States. Additionally, we generally source or manufacture apparel in parts of the world that may be affected by economic uncertainty, political unrest, labor disputes, health emergencies, natural disasters or the imposition of duties, tariffs or other import regulations by the United States.
The Branded Products segment also relies on the supply of other types of finished products including hard goods such as drinkware and injection molded plastics along with raw materials that are principally sourced from China, either directly or indirectly.
During 2025 higher and/or new tariffs and duties impacting certain sources of the Company's materials and production, were imposed by the U.S. government. We continue to monitor these imposed tariffs and duties and the ongoing negotiations between the U.S. government and the countries in which we manufacture, as well as evaluate sourcing alternatives.
NOTE 7 – Inventories:
Inventories consisted of the following amounts (in thousands):
| September 30, |
December 31, |
|||||||
| 2025 |
2024 |
|||||||
| Finished goods(1) |
$ | $ | ||||||
| Work in process |
||||||||
| Raw materials |
||||||||
| Inventories |
$ | $ | ||||||
(1) Certain raw materials were reclassified to finished goods in the current period and the December 31, 2024 balances were adjusted to the current period presentation.
NOTE 8 – Income Taxes:
The Company calculates its interim income tax provision in accordance with the accounting guidance for income taxes in interim periods. At the end of each interim period, the Company makes its best estimate of the annual expected effective tax rate and applies that rate to its ordinary year-to-date income or loss. The tax expense or benefit related to significant, unusual, or extraordinary items that will be separately reported or reported net of their related tax effect are individually computed and recognized in the interim period in which those items occur.
The computation of the annual expected effective tax rate at each interim period requires certain estimates and assumptions including, but not limited to, the expected operating income for the year and permanent and temporary differences. The accounting estimates used to compute the provision for income taxes may change as new events occur, additional information is obtained or the tax environment changes.
For the three months ended September 30, 2025, the Company recorded tax expense of $
For the three months ended September 30, 2024, the Company recorded a provision for income taxes of $
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted. The OBBBA includes significant changes to the domestic and international tax provisions, such as modifications to the global tax framework, the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, and the restoration of favorable tax treatment for certain business provisions. The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027. The Company has considered the impact of OBBBA on its annual effective tax rate. These changes did not have a significant impact on the annual effective tax rate in the quarter ended September 30, 2025. The Company is currently evaluating the future impacts of OBBBA on its consolidated financial statements.
NOTE 9 – Other Information:
The activity in the allowance for doubtful accounts receivable was as follows (in thousands):
| September 30, |
December 31, |
|||||
| 2025 |
2024 |
|||||
| Balance at the beginning of year |
$ | $ | ||||
| Credit loss (reversal) expense |
||||||
| Write-Off of Accounts Receivable |
( |
) | ( |
) | ||
| Balance at the end of the period |
$ | $ | ||||
Other current liabilities consisted of the following (in thousands):
| September 30, | December 31, | |||||||
| 2025 | 2024 | |||||||
| Salaries, wages, commissions and other compensation | $ | $ | ||||||
| Contract liabilities | ||||||||
| Accrued rebates | ||||||||
| Current operating lease liabilities | ||||||||
| Customer deposits | ||||||||
| Other accrued expenses | ||||||||
| Other current liabilities | $ | $ | ||||||
ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited financial statements and the notes thereto included in the Consolidated Financial Statements in Part I, Item 1 (“Financial Statements”) of this report and in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2024.
The financial position, results of operations, cash flows and other information included herein are not necessarily indicative of the financial position, results of operations and cash flows that may be expected in future periods. See "Cautionary Note Regarding Forward-Looking Statements" below for a discussion of uncertainties and assumptions that may cause actual results to differ materially from those expressed or implied in the forward-looking statements.
Business Outlook
Superior Group of Companies, Inc. (together with its subsidiaries, the “Company,” “Superior,” “we,” “our,” or “us”) is comprised of three reportable business segments: (1) Branded Products, (2) Healthcare Apparel and (3) Contact Centers.
Branded Products
In our Branded Products segment, we produce and sell customized merchandising solutions, promotional products and branded uniform programs to our customers. As a strategic branding partner, we offer our customers customized branding solutions and strategies that generate favorable brand impressions, bolster customer retention and enhance employee engagement. Our products are sold to customers in a wide range of industries, including retail chain, food service, entertainment, technology, transportation and other industries. Sales volumes in this segment are impacted by a number of factors, including marketing programs of our customers and turnover of our customers’ employees, often driven by the opening and closing of locations. From a long-term perspective, we believe that synergies within this segment will create opportunities to cross-sell products to new and existing customers.
Healthcare Apparel
In our Healthcare Apparel segment, we manufacture (through third parties or in our own facilities) and sell a wide range of healthcare apparel, such as scrubs, lab coats, protective apparel and patient gowns. We sell our brands of healthcare service apparel to healthcare laundries, dealers, distributors and retailers primarily in the United States. From a long-term perspective, we expect that demand for our portfolio of brands Wink®, Fashion Seal Healthcare®, its trade name CID Resources and our license of Carhartt Medical, will continue to provide opportunities for growth and increased market share.
Contact Centers
In our Contact Centers segment (also known as “The Office Gurus”), which operates in El Salvador, Belize, Dominican Republic, the United States and Jamaica until its closure on June 15, 2025, we provide outsourced, nearshore business process outsourcing, contact and call-center support services to North American customers. These services are also provided internally to the Company’s other two operating segments. The Office Gurus has become an award-winning business process outsourcer offering inbound and outbound voice, email, text, chat and social media support. The nearshore call-center market has grown as businesses look to reduce operating costs while maintaining high-quality customer support. Nearshore operators can provide comparable service to their U.S. counterparts at a fraction of the price. With an environment and career path designed to attract and maintain top talent across all sites, we believe The Office Gurus is positioned well to continue growing this business.
Global Economic and Political Conditions
During 2025, higher tariffs and/or new tariffs impacting certain sources of the Company’s materials and production were imposed by the U.S. government. Additionally, the U.S.'s trade agreements and/or preferences with certain countries in Africa, through the African Growth and Opportunity Act ("AGOA"), and with Haiti, through the Haitian Hemispheric Opportunity through Partnership Encouragement Act ("HOPE") and the Haiti Economic Lift Program of 2010 ("HELP"), all expired on September 30, 2025. If not renewed and/or retroactively extended, the cost of continuing to do business in these countries likely will negatively impact our results of operations and financial position, or result in us moving sourcing and manufacturing from these countries to countries with more favorable cost structures. We are monitoring these imposed tariffs and duties, related ongoing negotiations and the status of the trade agreements and preferences involving the U.S. government and the countries in which we source and/or manufacture products. See Item 1, “NOTE 6 – Contingencies and Geographic Supply Concentrations,” and "Item 1A — Risk Factors — Recently imposed tariffs may have a material adverse impact on our business."
It is uncertain how inflation and interest rates will be impacted during the remainder of 2025 by the imposition of tariffs and other trade-related actions or inactions. World events, including the Russia-Ukraine War and the ongoing conflict in the Middle East continue to have negative effects on the global economy. Civil unrest in countries where we manufacture products, such as Haiti, may result in our facilities incurring damage or destruction and could interrupt our manufacturing processes and adversely affect our reputation and our relationships with our customers.
Prolonged or recurring disruptions or instability in the United States and global political and economic environment, and how the world reacts to those disruptions or instability, could have long-term impacts on our business. These business impacts could negatively affect us in a number of ways, including, but not limited to, reduced demand for our core products and services, declines in our revenue and profitability, costs associated with complying with new or amended laws and regulations and mitigating the increased cost of the new tariffs and duties affecting our business, declines in our stock price, reduced availability and less favorable terms of future borrowings, negative impacts on the valuation of our pension obligations, reduced credit-worthiness of our customers, and potential impairment of the carrying value of indefinite-lived intangible assets.
| Results of Operations |
| Three Months Ended September 30, 2025 Compared to Three Months Ended September 30, 2024 |
| For the Three Months Ended September 30, |
||||||||||||
| 2025 |
2024 |
$ Change |
% Change |
|||||||||
| Net sales: |
||||||||||||
| Branded Products |
$ | 85,095 | $ | 92,547 | $ | (7,452 | ) | (8.1 | %) | |||
| Healthcare Apparel |
31,520 | 33,025 | (1,505 | ) | (4.6 | %) | ||||||
| Contact Centers |
22,664 | 25,038 | (2,374 | ) | (9.5 | %) | ||||||
| Net intersegment eliminations |
(812 | ) | (920 | ) | 108 | (11.7 | %) | |||||
| Consolidated net sales |
138,467 | 149,690 | (11,223 | ) | (7.5 | %) | ||||||
| Gross margin: |
||||||||||||
| Branded Products |
29,629 | 33,510 | (3,881 | ) | (11.6 | %) | ||||||
| Healthcare Apparel |
12,126 | 13,809 | (1,683 | ) | (12.2 | %) | ||||||
| Contact Centers |
11,995 | 13,742 | (1,747 | ) | (12.7 | %) | ||||||
| Net intersegment eliminations |
(672 | ) | (515 | ) | (157 | ) | 30.5 | % | ||||
| Consolidated gross margin |
53,078 | 60,546 | (7,468 | ) | (12.3 | %) | ||||||
| Selling and administrative expenses: |
||||||||||||
| Branded Products |
23,501 | 24,223 | (722 | ) | (3.0 | %) | ||||||
| Healthcare Apparel |
9,779 | 11,240 | (1,461 | ) | (13.0 | %) | ||||||
| Contact Centers |
10,283 | 11,482 | (1,199 | ) | (10.4 | %) | ||||||
| Intersegment Eliminations |
(672 | ) | (515 | ) | (157 | ) | 30.5 | % | ||||
| Other |
5,622 | 5,974 | (352 | ) | (5.9 | %) | ||||||
| Consolidated selling and administrative expenses |
48,513 | 52,404 | (3,891 | ) | (7.4 | %) | ||||||
| Interest expense, net |
1,378 | 1,569 | (191 | ) | (12.2 | %) | ||||||
| Income before income tax expense |
3,187 | 6,573 | (3,386 | ) | (51.5 | %) | ||||||
| Income tax expense |
443 | 1,170 | (727 | ) | (62.1 | %) | ||||||
| Net income |
$ | 2,744 | $ | 5,403 | $ | (2,659 | ) | (49.2 | %) | |||
| EBITDA(1) |
$ | 7,540 | $ | 11,654 | $ | (4,114 | ) | (35.3 | %) | |||
(1) Please refer to "Non-GAAP Financial Measure" below for a reconciliation of EBITDA to net (loss) income.
Net Income
The Company generated net income of $2.7 million and $5.4 million during the three months ended September 30, 2025 and 2024, respectively. The decrease in net income during the three months ended September 30, 2025 compared to the three months ended September 30, 2024 was primarily due to a decrease in net sales and gross margins across all of our reportable segments, partially offset by a decrease in selling and administrative expenses.
EBITDA
EBITDA was $7.5 million and $11.7 million during the three months ended September 30, 2025 and 2024, respectively. The EBITDA decrease was primarily due to the decrease in net sales and gross margins across all of our reportable segments, partially offset by a decrease in selling and administrative expenses. For a reconciliation of EBITDA to net income, its most directly comparable financial measure calculated and presented in accordance with GAAP, please read “Non-GAAP Financial Measure” below.
Net Sales
Net sales for the Company decreased 7.5%, or $11.2 million, for the three months ended September 30, 2025 compared to the three months ended September 30, 2024. The decrease was attributable to decreases in net sales across all of our reportable segments.
Branded Products net sales decreased 8.1%, or $7.5 million, for the three months ended September 30, 2025 compared to the three months ended September 30, 2024. The decrease was primarily due to $8.0 million in timing of orders delivered in the prior quarter and lower sales volume and pricing from existing customers. These were partially offset by a $2.9 million increase resulting from revenue generated by 3Point following the acquisition in December 2024.
Healthcare Apparel net sales decreased 4.6%, or $1.5 million, for the three months ended September 30, 2025 compared to the three months ended September 30, 2024. The decrease was primarily due to volume decreases within existing customer accounts.
Contact Centers net sales decreased 9.5% or $2.4 million, before intersegment eliminations for the three months ended September 30, 2025 compared to the three months ended September 30, 2024. The 9.5% decrease versus the year-ago quarter reflects continued macroeconomic headwinds, which continue to contribute to client downsizing and client attrition outpacing new customer acquisitions.
Gross Margin
Gross margin rate for the Company was 38.3% for the three months ended September 30, 2025 and 40.4% for the three months ended September 30, 2024.
Gross margin rate for our Branded Products segment was 34.8% for the three months ended September 30, 2025 and 36.2% for the three months ended September 30, 2024. The decrease in the gross margin rate was attributable to customer sales mix for the three months ended September 30, 2025.
Gross margin rate for our Healthcare Apparel segment was 38.5% for the three months ended September 30, 2025 and 41.8% for the three months ended September 30, 2024. The gross margin rate decreased as compared to the prior year period due to product cost reductions in the prior year.
Gross margin rate for our Contact Centers segment was 52.9% for the three months ended September 30, 2025 and 54.9% for the three months ended September 30, 2024. The decrease in the gross margin rate was attributable to higher agent costs and unfavorable margin mix associated with the closure of our Jamaica contact center.
Selling and Administrative Expenses
As a percentage of net sales, total selling and administrative expenses was 35.0% for the three months ended September 30, 2025 and for the three months ended September 30, 2024.
As a percentage of net sales, selling and administrative expenses for our Branded Products segment was 27.6% for the three months ended September 30, 2025 and 26.2% for the three months ended September 30, 2024. The rate increase was primarily related to expense deleverage from the net sales decrease for the three months ended September 30, 2025. The decrease in selling and administrative expenses of $0.7 million for the three months ended September 30, 2025 compared to the three months ended September 30, 2024 was due to lower employee related costs driven by headcount reductions.
As a percentage of net sales, selling and administrative expenses for our Healthcare Apparel segment was 31.0% for the three months ended September 30, 2025 and 34.0% for the three months ended September 30, 2024. The rate decrease was primarily due to lower employee related costs.
As a percentage of net sales, selling and administrative expenses for our Contact Centers segment was 45.4% for the three months ended September 30, 2025 which improved slightly from 45.9% for the three months ended September 30, 2024. The rate decreased as compared to the prior year period driven by a prior year increase in credit loss reserve and lower employee related costs in the current period.
Selling and administrative expenses for Other, which represents Corporate costs, decreased primarily due to lower employee related costs.
Interest Expense, Net
Interest expense, net decreased to $1.4 million for the three months ended September 30, 2025 from $1.6 million for three months ended September 30, 2024. This decrease was due to a lower weighted average interest rate on those borrowings from 6.3% for the three months ended September 30, 2024 to 5.4% for the three months ended September 30, 2025.
Income Taxes
Income tax expense decreased to $0.4 million for the three months ended September 30, 2025 from $1.2 million for the three months ended September 30, 2024. The effective tax rate was 13.9% and 17.8% for the three months ended September 30, 2025 and 2024, respectively. Income tax expense and the effective tax rate for the three months ended September 30, 2025 and September 30, 2024 were primarily impacted by the variability in the mix of earnings across the Company’s foreign and domestic operations, subject to various statutory tax rates in those jurisdictions. The tax rates were further favorably impacted by the performance of the Company’s compensation plans during the three months ended September 30, 2025 and 2024. The effective tax rate may vary from quarter to quarter due to discrete, unusual or non-recurring items, the resolution of income tax audits, changes in tax laws, the tax impact from employee share-based payments, or other items.
| Nine Months Ended September 30, 2025 Compared to Nine Months Ended September 30, 2024 |
| For the Nine Months Ended September 30, |
||||||||||||||||
| 2025 |
2024 |
$ Change |
% Change |
|||||||||||||
| Net sales: |
||||||||||||||||
| Branded Products |
$ | 264,216 | $ | 260,911 | $ | 3,305 | 1.3 | % | ||||||||
| Healthcare Apparel |
87,036 | 88,854 | (1,818 | ) | (2.0 | %) | ||||||||||
| Contact Centers |
70,866 | 73,422 | (2,556 | ) | (3.5 | %) | ||||||||||
| Net intersegment eliminations |
(2,509 | ) | (2,919 | ) | 410 | (14.0 | %) | |||||||||
| Consolidated net sales |
419,609 | 420,268 | (659 | ) | (0.2 | %) | ||||||||||
| Gross margin: |
||||||||||||||||
| Branded Products |
90,332 | 93,377 | (3,045 | ) | (3.3 | %) | ||||||||||
| Healthcare Apparel |
32,275 | 35,519 | (3,244 | ) | (9.1 | %) | ||||||||||
| Contact Centers |
37,589 | 39,347 | (1,758 | ) | (4.5 | %) | ||||||||||
| Net intersegment eliminations |
(1,351 | ) | (1,625 | ) | 274 | (16.9 | %) | |||||||||
| Consolidated gross margin |
158,845 | 166,618 | (7,773 | ) | (4.7 | %) | ||||||||||
| Selling and administrative expenses: |
||||||||||||||||
| Branded Products |
72,353 | 70,486 | 1,867 | 2.6 | % | |||||||||||
| Healthcare Apparel |
29,383 | 30,931 | (1,548 | ) | (5.0 | %) | ||||||||||
| Contact Centers |
32,816 | 32,436 | 380 | 1.2 | % | |||||||||||
| Intersegment Eliminations |
(1,351 | ) | (1,625 | ) | 274 | (16.9 | %) | |||||||||
| Other |
17,654 | 17,678 | (24 | ) | (0.1 | %) | ||||||||||
| Consolidated selling and administrative expenses |
150,855 | 149,906 | 949 | 0.6 | % | |||||||||||
| Interest expense, net |
3,873 | 4,897 | (1,024 | ) | (20.9 | %) | ||||||||||
| Income before income tax expense |
4,117 | 11,815 | (7,698 | ) | (65.2 | %) | ||||||||||
| Income tax expense |
580 | 1,900 | (1,320 | ) | (69.5 | %) | ||||||||||
| Net income |
$ | 3,537 | $ | 9,915 | $ | (6,378 | ) | (64.3 | %) | |||||||
| EBITDA(1) |
$ | 17,147 | $ | 26,844 | $ | (9,697 | ) | (36.1 | %) | |||||||
(1) Please refer to "Non-GAAP Financial Measure" below for a reconciliation of EBITDA to net (loss) income.
Net Income
The Company generated net income of $3.5 million and $9.9 million during the nine months ended September 30, 2025 and 2024, respectively. The decrease in net income during the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was primarily due to lower gross margins at all three of our reportable segments, partially offset by a decrease in interest expense.
EBITDA
EBITDA was $17.1 million and $26.8 million during the nine months ended September 30, 2025 and 2024, respectively. The EBITDA decrease was primarily due to lower gross margins at all three of our reportable segments. For a reconciliation of EBITDA to net income, its most directly comparable financial measure calculated and presented in accordance with GAAP, please read “Non-GAAP Financial Measure” below.
Net Sales
Net sales for the Company decreased 0.2% or $0.7 million, for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decrease was attributable to decreases in net sales in our Healthcare Apparel and Contact Centers reportable segments.
Branded Products net sales increased 1.3%, or $3.3 million, for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The increase was due to a $9.1 million increase resulting from revenue generated by 3 Point following the acquisition in December 2024, offset by a decrease within existing large enterprise accounts.
Healthcare Apparel net sales decreased 2.0% or $1.8 million, for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The decrease was primarily due to volume decreases within existing customer accounts.
Contact Centers net sales decreased 3.5% or $2.6 million, before intersegment eliminations for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024. The 3.5% decrease versus the year-ago period reflects continued macroeconomic headwinds, which continue to contribute to client downsizing and client attrition outpacing new customer acquisitions.
Gross Margin
Gross margin rate for the Company was 37.9% for the nine months ended September 30, 2025 and 39.6% for the nine months ended September 30, 2024. The gross margin rate decrease was driven by gross margin rate decreases in all three of our reportable segments.
Gross margin rate for our Branded Products segment was 34.2% for the nine months ended September 30, 2025 and 35.8% for the nine months ended September 30, 2024. The gross margin rate decreased as compared to the prior year period due to sourcing mix resulting in higher product costs and lower pricing to existing customers.
Gross margin rate for our Healthcare Apparel segment was 37.1% for the nine months ended September 30, 2025 and 40.0% for the nine months ended September 30, 2024. The gross margin rate decreased as compared to the prior year period due to product cost reductions in the prior year and during the current year $0.6 million higher tariff costs in advance of price increases to our customers.
Gross margin rate for our Contact Centers segment was 53.0% for the nine months ended September 30, 2025, down slightly from 53.6% for the nine months ended September 30, 2024.
Selling and Administrative Expenses
As a percentage of net sales, total selling and administrative expenses was 36.0% for the nine months ended September 30, 2025 and 35.7% for the nine months ended September 30, 2024.
As a percentage of net sales, selling and administrative expenses for our Branded Products segment was 27.4% for the nine months ended September 30, 2025 and 27.0% for the nine months ended September 30, 2024. The increase in selling and administrative expenses of $1.9 million for the nine months ended September 30, 2025 compared to the nine months ended September 30, 2024 was driven by increased sales resulting in higher sales commission expense, an adjustment to credit loss reserves of $0.5 million and increased costs from 3Point acquired in December 2024, offset by lower employee related costs driven by headcount reductions.
As a percentage of net sales, selling and administrative expenses for our Healthcare Apparel segment was 33.8% for the nine months ended September 30, 2025 and 34.8% for the nine months ended September 30, 2024. The rate decrease as compared to the prior year period was primarily driven by a decrease in depreciation expense and lower employee related costs.
As a percentage of net sales, selling and administrative expenses for our Contact Centers segment was 46.3% for the nine months ended September 30, 2025 and 44.2% for the nine months ended September 30, 2024. The rate increase as compared to the prior year period was primarily driven by an increase in credit loss expense.
Selling and administrative expenses for Other, which represents Corporate costs, are consistent with the prior year period.
Interest Expense, Net
Interest expense, net decreased to $3.9 million for the nine months ended September 30, 2025 from $4.9 million for nine months ended September 30, 2024. This decrease was due to a lower weighted average interest rate on those borrowings from 6.5% for the nine months ended September 30, 2024 to 5.4% for the nine months ended September 30, 2025.
Income Taxes
Income tax expense decreased to $0.6 million for the nine months ended September 30, 2025 from $1.9 million for the nine months ended September 30, 2024. The effective tax rate was 14.1% and 16.1% for the nine months ended September 30, 2025 and 2024, respectively. Income tax expense and the effective tax rate for the nine months ended September 30, 2025 and September 30, 2024 were primarily impacted by the variability in the mix of earnings across the Company’s foreign and domestic operations, subject to various statutory tax rates in those jurisdictions. The tax rates were further favorably impacted by the performance of the Company’s compensation plans during the nine months ended September 30, 2025 and 2024 totaling $1.0 million and $0.5 million respectively. The effective tax rate may vary from quarter to quarter due to discrete, unusual or non-recurring items, the resolution of income tax audits, changes in tax laws, the tax impact from employee share-based payments, or other items.
Liquidity and Capital Resources
Liquidity Analysis
Short-Term Liquidity
For the next twelve months, our primary capital requirements are for capital to maintain our operations, meet contractual obligations, primarily consisting of our revolving credit facility, term loan, operating leases and acquisition-related contingent liabilities, and fund capital expenditures, dividends, stock repurchases, any potential merger and acquisition activity and other general corporate purposes. Management currently believes that the combination of our current cash level, cash flows provided by operating activities and availability under the revolving credit facility will be sufficient to satisfy the above requirements for the next twelve months.
Long-Term Liquidity
Beyond the next twelve months, our principal demand for funds will be for maintenance of our core business, to satisfy long-term contractual obligations, stock repurchases, any potential merger and acquisition activity and the Company’s ongoing capital expenditure program designed to improve the effectiveness and capabilities of its facilities and technology. The Company at all times evaluates its capital expenditure program in light of prevailing economic conditions. The Company's material contractual obligations include outstanding debt, operating leases, long-term pension liability and non-qualified deferred compensation plan liabilities in Other Liabilities. Management currently believes that the combination of our current cash level, cash flows provided by operating activities and availability under the revolving credit facility will be sufficient to satisfy the above requirements.
Cash Requirements
Working Capital Needs
The Company carries inventories of both raw materials and finished products, the practice of which requires substantial working capital, which we believe to be common in the industry. The Company also requires working capital to invest in new product lines and technologies.
Capital expenditures
Capital expenditures were $3.4 million and $2.9 million for the nine months ended September 30, 2025 and 2024, respectively.
Sources of Capital and Liquidity
Cash Flows from Operations
Net cash provided by operating activities primarily results from cash collected from our segments' customers, offset by cash payments made for raw materials, finished goods, salaries and payroll-related benefits, leases and other general corporate expenditures.
For the nine months ended September 30, 2025, net cash provided by operating activities was $1.3 million. Cash collections from customers exceeded aggregate cash payments to vendors, lessors and employees. These cash collections were offset by cash payments including $10.5 million of cash outflows for inventory purchases. The inventory balance is up from the prior year primarily due to the sales decrease in Healthcare Apparel, as well as, the timing of purchases.
For the nine months ended September 30, 2024, net cash provided by operating activities was $24.5 million. Cash collections from customers exceeded aggregate cash payments to vendors, lessors, employees and lenders primarily driven by the Company’s collection of receivable balances and increases in cash inflows for inventory.
Credit Facilities and Debt Activity
The Company’s primary source of liquidity has been its net income and the use of credit facilities and term loans. The Company has access to a Revolving Credit Facility with a maximum principal amount of $125.0 million and a term loan in the original aggregate principal amount of $75.0 million and the ability to request incremental revolving credit or term loan facilities in an aggregate amount of up to an additional $75.0 million, subject to obtaining additional lender commitments and satisfying certain other conditions.
For the nine months ended September 30, 2025, the Company had $76.0 million in borrowings and $58.0 million in payments on the revolving credit facility. For the nine months ended September 30, 2025, the Company had $4.2 million in payments on the term loan.
For the nine months ended September 30, 2024, the Company had $31.0 million in borrowings and $37.0 million in payments on the revolving credit facility. For the nine months ended September 30, 2024, the Company had $3.3 million in payments on the term loan.
In the future, the Company may continue to use credit facilities and other secured and unsecured borrowings as a source of liquidity. Additionally, the cost of the Company’s future sources of liquidity may differ from the costs of the Company’s sources of liquidity to date.
Please refer to Note 5 to our Condensed Notes to the Consolidated Financial Statements located in Item 1 of Part I of this Quarterly Report on Form 10-Q for additional details on our outstanding long-term debt.
Dividends and Share Repurchase Program
During the nine months ended September 30, 2025 and 2024, the Company paid cash dividends of $6.7 million and $7.0 million, respectively. The Company anticipates that it will continue to pay dividends in the future as financial conditions permit.
On September 19, 2025, the “Company entered into a 10b5-1 trading plan (the “Plan”) for the purpose of repurchasing up to a specified number of shares of the Company’s outstanding common stock (the “Repurchase Limit”) in accordance with the $17.5 million share repurchase program previously authorized by the Company’s Board of Directors, which was announced by the Company on March 11, 2025. The Plan is intended to comply with Rule 10b5-1(c) under the Securities Exchange Act of 1934, as amended. The Plan allows the Company to repurchase shares up to the Repurchase Limit commencing September 20, 2025 and ending on the earlier of the date on which the Repurchase Limit is reached or other events specified in the Plan. Repurchases of common stock under the Plan will be administered through an independent broker and are subject to certain price, market, volume and timing constraints specified in the Plan.
Critical Accounting Estimates
See Part II, Item 7, "Management’s Discussion and Analysis of Financial Condition and Results of Operations – Critical Accounting Policies and Estimates" in our Annual Report on Form 10-K for the year ended December 31, 2024.
The preparation of our financial statements in conformity with GAAP requires the Company to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities and disclosures at the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. There have been no material changes to the critical accounting estimates disclosed in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2024, except that the critical accounting estimate set forth under, “Annual Impairment Tests” is updated as follows:
Annual Impairment Tests:
The Company performs its goodwill and indefinite-lived intangible impairment tests annually or more frequently as events or changes in circumstances warrant. The timing of the annual impairment tests was changed to August 31st, and historically was performed during the fourth quarter.
Indefinite-lived Intangible Assets:
As of August 31, 2025, the Company performed its annual impairment test for its indefinite-lived trade name intangible assets which did not result in an impairment. We conducted a quantitative assessment using the relief-from-royalty method, which we believe to be an acceptable methodology due to its common use by valuation specialists in determining the fair value of intangible assets. This methodology assumes that, in lieu of ownership, a third party would be willing to pay a royalty in order to exploit the related benefits of these assets. The assumptions that have the most significant effect on the fair value calculations are the royalty rates, projected revenue growth rates, discount rates, and terminal values. Each royalty rate is determined based on the profitability of the trade name to which it relates.
In determining the fair value of our trade name indefinite lived intangible assets as of August 31, 2025, we used the following key assumptions:
• Royalty rates of 0.75% - 3.0%;
• A tax rate of 27.0%;
• A long-term growth rate of 3.0%; and
• Assumed discount rates of 14.5% - 16.5%
Goodwill:
The discounted cash flow approach that we use for valuing goodwill as part of our impairment testing approach involves estimating future cash flows expected to be generated from the related assets, discounted to their present value using a risk-adjusted discount rate. Terminal values are also estimated and discounted to their present value. Assessing the recoverability of goodwill requires us to make estimates and assumptions about sales, operating margins, growth rates and discount rates based on our forecasts, business plans, economic projections, anticipated future cash flows and marketplace data.
We performed our annual impairment test as of August 31, 2025, which did not result in any goodwill impairment. In determining the fair value of our reporting unit, we used the following assumptions:
| • |
Expected cash flows underlying our business plans for the initial five-year period were based on a detailed, multi-year forecast performed by our BAMKO reporting unit; |
| • |
Long-term growth rate of 3.0%; and |
| • |
Discount rate of 14.0% |
Non-GAAP Financial Measure
EBITDA, which is a non-GAAP financial measure, is defined as net income excluding interest expense, net, income tax expense, depreciation and amortization expense and impairment charges. 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. 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 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.
The following table reconciles net income to EBITDA (in thousands):
| Three Months Ended September 30, |
Nine Months Ended September 30, |
|||||||||||||||
| 2025 |
2024 |
2025 |
2024 |
|||||||||||||
| Net income |
$ | 2,744 | $ | 5,403 | $ | 3,537 | $ | 9,915 | ||||||||
| Interest expense, net |
1,378 | 1,569 | 3,873 | 4,897 | ||||||||||||
| Income tax expense |
443 | 1,170 | 580 | 1,900 | ||||||||||||
| Depreciation and amortization |
2,975 | 3,252 | 9,157 | 9,872 | ||||||||||||
| Impairment charge |
- | 260 | - | 260 | ||||||||||||
| EBITDA |
$ | 7,540 | $ | 11,654 | $ | 17,147 | $ | 26,844 | ||||||||
Cautionary Note Regarding Forward Looking Statements
Certain matters discussed in this Form 10-Q 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 Quarterly Report on Form 10-Q 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 tariffs, duties, trade wars and related matters, 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 Company’s ability 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 herein and in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024 and in this Quarterly Report on Form 10-Q for the quarter ended September 30, 2025. 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 Form 10-Q 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.
ITEM 4. Controls and Procedures
Disclosure Controls and Procedures
The Company conducted an evaluation, under supervision and with the participation of the Company’s principal executive officer, Michael Benstock, and the Company’s principal financial officer, Michael Koempel, of the effectiveness of the Company’s disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report (the “Evaluation Date”). Based on such evaluation, the Company’s principal executive officer and principal financial officer concluded that, as of the Evaluation Date, the Company’s disclosure controls and procedures were effective to ensure that information the Company is required to disclose in its filings with the SEC under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and to ensure that information required to be disclosed by the Company in the reports that it files or submits under the Exchange Act is accumulated and communicated to the Company’s management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
Changes in Internal Control over Financial Reporting
There were no changes in the Company’s internal control over financial reporting during the quarter ended September 30, 2025 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
PART II - OTHER INFORMATION
ITEM 1. Legal Proceedings
We are a party to certain lawsuits in the ordinary course of business. We do not believe that these proceedings, individually or in the aggregate, will have a material adverse effect on our financial position, results of operations or cash flows.
ITEM 1A. Risk Factors
We are exposed to certain risks and uncertainties that could have a material adverse impact on our business, financial condition and operating results. Except as set forth below, there have been no material changes to the Risk Factors described in Part I, Item 1A-Risk Factors in our Annual Report on Form 10-K for the year ended December 31, 2024.
Recently imposed tariffs and upcoming tariff-related decisions may have a material adverse impact on our business
Beginning in our second quarter of 2025, significant new and expanded tariffs, reciprocal tariffs and other trade restrictions have been imposed with selective tariff exemptions impacting global trade. We purchase or manufacture our products largely in Haiti, China, Madagascar, Vietnam, Pakistan and Bangladesh. Demand for our products may be adversely impacted if we are unable to share the cost increases with our suppliers and third-party manufacturers or pass along the remaining cost increases to our customers. The continuation, expansion, or introduction of U.S. tariffs on countries from which we source and/or manufacture products, such as China and Vietnam, could have a material adverse impact on our revenue, operations, financial position and cash flows.
Additionally, the U.S. had trade agreements and/or preferences with certain countries in Africa, through the African Growth and Opportunity Act ("AGOA"), and with Haiti, through the Haitian Hemispheric Opportunity through Partnership Encouragement Act ("HOPE") and the Haiti Economic Lift Program of 2010 ("HELP"), all of which expired on September 30, 2025. If not renewed and/or retroactively extended, the cost of continuing to do business in these countries could negatively impact our results of operations and financial position or result in us moving sourcing and manufacturing from these countries to countries with more favorable cost structures. We are monitoring these imposed tariffs and duties, related ongoing negotiations and the status of the trade agreements and preferences involving the U.S. government and the countries in which we source and/or manufacture products. Other trade agreements and/or preferences may expire or be terminated as well. The outcome of these trade agreements and/or preferences could have a material adverse impact on our revenue, operations, financial position and cash flows.
ITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds
There were no unregistered sales of equity securities during the quarter ended September 30, 2025, that were not previously reported in a current report on Form 8-K.
The table below sets forth information with respect to purchases made by or on behalf of Superior Group of Companies, Inc. or any “affiliated purchaser” (as defined in Rule 10b-18(a)(3) under the Exchange Act) of our common stock during the three months ended September 30, 2025.
| Period |
Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1), (2) | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (3) | ||||||||||||
| July 1, 2025 to July 31, 2025 |
- | $ | - | - | ||||||||||||
| August 1, 2025 to August 31, 2025 |
- | - | - | |||||||||||||
| September 1, 2025 to September 30, 2025 |
- | - | - | |||||||||||||
| Total |
- | $ | - | - | ||||||||||||
| (1) | For the three months ended September 30, 2025 there were no shares tendered by employees in connection with the exercise of stock options under the Company's shareholder-approved 2022 Equity Incentive and Awards Plan. |
| (2) | The above table excludes shares of our common stock withheld to settle employee tax withholding related to the vesting of restricted stock awards. Total shares were 3,206 in July 2025. |
| (3) | On September 19, 2025, Superior Group of Companies, Inc. (the “Company”) entered into a 10b5-1 trading plan (the “Plan”) for the purpose of repurchasing up to a specified number of shares of the Company’s outstanding common stock (the “Repurchase Limit”) in accordance with the $17.5 million share repurchase program ("Program") previously authorized by the Company’s Board of Directors, which was announced by the Company on March 11, 2025. The Plan is intended to comply with Rule 10b5-1(c) under the Securities Exchange Act of 1934, as amended. The Plan allows the Company to repurchase shares up to the Repurchase Limit commencing September 20, 2025 and ending on the earlier of the date on which the Repurchase Limit is reached or other events specified in the Plan. Repurchases of common stock under the Plan will be administered through an independent broker and are subject to certain price, market, volume and timing constraints specified in the Plan. The approximate dollar value of shares that may still be purchased under the Program is $12.3 million as of September 30, 2025. |
Under our Credit Agreement, if an event of default exists, we may not make distributions to our shareholders. The Credit Agreement also contains other restrictions. See Note 5 to our Condensed Notes to the Consolidated Financial Statements located in Item 1 of Part I of this Quarterly Report on Form 10-Q.
ITEM 3. Defaults upon Senior Securities
Not applicable.
ITEM 4. Mine Safety Disclosures
Not applicable.
ITEM 5. Other Information
Not applicable.
ITEM 6. Exhibits
| Exhibit No. | Description | |
| 31.1* | Certification by the Chief Executive Officer (Principal Executive Officer) pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 31.2* | Certification by the Chief Financial Officer (Principal Financial Officer) pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |
| 32** | Certification by the Chief Executive Officer and the Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. | |
| 101.INS+ |
Inline XBRL Instance Document. |
|
| 101.SCH+ |
Inline XBRL Taxonomy Extension Schema. |
|
| 101.CAL+ |
Inline XBRL Taxonomy Extension Calculation Linkbase. |
|
| 101.DEF+ |
Inline XBRL Taxonomy Extension Definition Linkbase. |
|
| 101.LAB+ |
Inline XBRL Taxonomy Extension Label Linkbase. |
|
| 101.PRE+ |
Inline XBRL Taxonomy Extension Presentation Linkbase. |
|
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). |
* Filed herewith.
**Furnished herewith.
+ Submitted electronically herewith.
SIGNATURES
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 thereunto duly authorized.
| Date: November 3, 2025 | SUPERIOR GROUP OF COMPANIES, INC. | |
| By | /s/ Michael Benstock | |
| Michael Benstock | ||
| Chief Executive Officer | ||
| (Principal Executive Officer) | ||
| Date: November 3, 2025 | ||
| By | /s/ Michael Koempel | |
| Michael Koempel | ||
| President & Chief Financial Officer (Principal Financial Officer) |
||
