EX-99.1 2 ex99-1.htm EX. 99.1 ex99-1.htm
 
NEWS RELEASE               EXHIBIT 99.1
 
Superior Uniform Group, Inc.
A NASDAQ Listed Company: SGC
10055 Seminole Boulevard
Seminole, Florida  33772-2539
Telephone (727) 397-9611
Fax (727) 803-9623
 
Contact: Andrew D. Demott, Jr., CFO   
(727) 803-7135
  FOR IMMEDIATE RELEASE
 
   
 
SUPERIOR UNIFORM GROUP, INC. REPORTS OPERATING RESULTS FOR 2012
 
·
6.3% Increase in Net Sales for 2012
 
·
Records Non-Cash Impairment Charge for Intangible Assets of $1,226,000 before tax benefit
 
·
14.0% Increase in Net Sales in Fourth Quarter 2012
 
·
83.3% Increase in Earnings Per Share in Fourth Quarter 2012 before Impairment Charge


SEMINOLE, Fla. - February 26, 2013 ­­– Superior Uniform Group, Inc. (NASDAQ: SGC), manufacturer of uniforms, image apparel and accessories, today announced its fourth quarter and year-end operating results for 2012.

The Company announced that for the year ended December 31, 2012, net sales increased 6.3% to $119,486,000, compared to 2011 net sales of $112,373,000. Net earnings for the year ended December 31, 2012 were $3,031,000 or $0.49 per share (diluted) compared to $4,136,000 or $0.68 per share (diluted) reported for the year ended December 31, 2011.

Net earnings for the fourth quarter ended December 31, 2012 were $485,000 or $0.08 per share (diluted) compared to net earnings of $725,000 or $0.12 per share (diluted) reported for the fourth quarter ended December 31, 2011.  Net earnings for the fourth quarter included a non-cash, pre-tax intangible asset impairment loss of $1,226,000 to write off the remaining balance of its intangible asset associated with its licensing agreement with EyeLevel Interactive North America, LLC.  After tax, this charge resulted in a reduction of earnings per share (diluted) of approximately $0.14.

Michael Benstock, chief executive officer, commented: “We are very pleased to report a 6.3% increase in net sales for the year.  We are especially pleased to report our fourth quarter results as we achieved a 14.0% increase in net sales and an increase of approximately 83% in our earnings per share (diluted) before consideration of the intangible asset impairment loss.  We reported strong gains in net sales in the fourth quarter for both our Uniforms and Related Products segment at 12.8% and our Remote Staffing Solutions segment at 55%.

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“As we have discussed in our previous releases, our gross margins were greatly pressured in the first three quarters of 2012 as we worked our way through the higher priced inventory relative to the cotton crisis.  As a result, our gross margins for the year ended December 31, 2012 were 33.3% as compared to 35.8% for the prior year.  As expected, we saw significant improvement in our gross margins in the fourth quarter up to 34.2% compared to 33.0% for the first nine months of 2012.  We expect that this trend will continue in 2013.

“Although we believe that our everyBODY media® product line provides us with an opportunity for significant growth in our Uniforms and Related Products segment in the future, we have not been able to generate any significant revenues from the product line during the last two years.  We have attempted to negotiate an extension of the initial term of the related licensing agreement and are continuing to pursue this extension.  However, we have not been successful to this point and cannot be assured that we will ultimately be able to negotiate an extension on reasonable terms.    Additionally, we have been involved in two significant test programs with two separate customers during 2012.  One of these programs was with a major retailer in the northeast in the fourth quarter.  The test was adversely affected by hurricane Sandy and, as a result, the customer determined that it did not yet have sufficient data to conclude on moving forward with a full program.  We are in the process of developing another test program with this customer in 2013.  Additionally, while the feedback from the other test program has been positive, the customer has been slow to move to a full revenue producing program at this point.  As a result of these items and the lack of an extension of the initial term at this point, we concluded that we did not have adequate, verifiable cash flows to support recovery of the intangible asset at December 31, 2012.  Therefore, we recorded a pre-tax, non-cash impairment charge of $1,226,000 in the fourth quarter of 2012 to write off the remaining balance of the licensing agreement.  Our operating results also include approximately $818,000 of amortization expense associated with this licensing agreement in each of the years ended December 31, 2012 and 2011.  This amortization expense will not repeat in 2013.

 “Our financial position remains very strong as we ended the year in a positive cash position and with a debt free balance sheet despite prepaying our regular quarterly dividend for the full year of 2013 during the fourth quarter of 2012.

“We believe that 2012 was a transition year for the Company as we worked to improve our internal sales and marketing support systems for both our Uniforms and Related Products segment and our Remote Staffing Solutions segment.  We enter 2013 in a very strong position and anticipate reporting continued significant improvement in our operating results.”

ABOUT SUPERIOR UNIFORM GROUP, INC.
 
Superior Uniform Group, Inc. (NASDAQ: SGC), established in 1920, is one of America's foremost providers of fine uniforms and image apparel. Headquartered in Seminole, Fla., Superior Uniform Group manages award-winning uniform apparel programs for major corporations nationwide.  Leaders in innovative uniform program design,
 
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global manufacturing and state-of-the-art distribution, Superior Uniform Group helps companies achieve a professional appearance and communicate their brands—particularly those in the healthcare, hospitality, food service, retail and private security industries. The company’s commitment to service, technology, quality and value-added benefits, as well as its financial strength and resources, support customers’ diverse needs while embracing a "Customer 1st, Every Time!" philosophy and culture. Superior Uniform Group is the parent company to The Office Gurus® and everyBODY media®.  For more information, call (800) 727-8643 or visit www.superioruniformgroup.com.
 
Statements contained in this press release which are not historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995.  All forward-looking statements are subject to risks and uncertainties, including without limitation, those identified in the Company’s SEC filings, which could cause actual results to differ from those projected.
 
 
Comparative figures for 2012 and 2011 are as follows:
 
Superior Uniform Group, Inc. and Subsidiaries
           
Consolidated Statements of Income
           
             
   
Three Months Ended December 31,
 
   
(Unaudited)
 
   
2012
   
2011
 
Net sales
  $ 31,044,000     $ 27,238,000  
                 
Costs and expenses:
               
Cost of goods sold
    20,437,000       17,954,000  
Selling and administrative expenses
    8,550,000       8,663,000  
Intangible asset impairment
    1,226,000       -  
Interest expense
    6,000       6,000  
      30,219,000       26,623,000  
                 
Income before taxes on income
    825,000       615,000  
Taxes on income
    340,000       (110,000 )
Net income
  $ 485,000     $ 725,000  
                 
Weighted average number of shares outstanding during the period
               
(Basic)     6,091,377       5,987,598  
(Diluted)     6,140,372       6,137,137  
                 
Per Share Data:
               
                 
Basic:
               
Net earnings
  $ 0.08     $ 0.12  
Diluted:
               
Net earnings
  $ 0.08     $ 0.12  
                 
Dividends per common share
  $ 0.675     $ 0.135  
 
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Superior Uniform Group, Inc. and Subsidiaries
           
             
Consolidated Statements of Income
           
Years Ended December 31,
           
             
   
2012
   
2011
 
Net sales
  $ 119,486,000     $ 112,373,000  
                 
Costs and expenses:
               
Cost of goods sold
    79,723,000       72,114,000  
Selling and administrative expenses
    33,886,000       34,646,000  
Intangible asset impairment
    1,226,000       -  
Interest expense
    30,000       27,000  
      114,865,000       106,787,000  
                 
Income before taxes on income
    4,621,000       5,586,000  
Taxes on income
    1,590,000       1,450,000  
                 
Net income
  $ 3,031,000     $ 4,136,000  
                 
Weighted average number of shares outstanding during the period
               
 (Basic)
    6,061,691       5,987,062  
(Diluted)
    6,142,997       6,094,914  
Per Share Data:
               
Basic:
               
Net earnings
  $ 0.50     $ 0.69  
Diluted:
               
Net earnings
  $ 0.49     $ 0.68  
                 
Dividends per common share
  $ 1.08     $ 0.54  
 
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Superior Uniform Group, Inc. and Subsidiaries
           
Consolidated Balance Sheets
           
             
December 31,
           
             
ASSETS
(Unaudited)
   
2012
   
2011
 
CURRENT ASSETS
           
Cash and cash equivalents
  $ 3,554,000     $ 2,804,000  
Accounts receivable
    16,655,000       15,942,000  
Accounts receivable - other
    2,995,000       3,745,000  
Inventories
    39,246,000       41,208,000  
Prepaid expenses and other current assets
    2,794,000       2,525,000  
TOTAL CURRENT ASSETS
    65,244,000       66,224,000  
PROPERTY, PLANT AND EQUIPMENT, NET
    8,723,000       8,412,000  
OTHER INTANGIBLE ASSETS
    559,000       2,749,000  
DEFERRED INCOME TAXES
    4,205,000       3,455,000  
OTHER ASSETS
    182,000       107,000  
 
  $ 78,913,000     $ 80,947,000  
                 
LIABILITIES AND SHAREHOLDERS' EQUITY
                 
CURRENT LIABILITIES
               
Accounts payable
  $ 6,629,000     $ 5,941,000  
Other current liabilities
    3,222,000       4,499,000  
TOTAL CURRENT LIABILITIES
    9,851,000       10,440,000  
LONG-TERM DEBT
    -       640,000  
LONG-TERM PENSION LIABILITY
    10,468,000       8,086,000  
OTHER LONG-TERM LIABILITIES
    736,000       735,000  
DEFERRED INCOME TAXES
    70,000       -  
COMMITMENTS AND CONTINGENCIES
               
TOTAL SHAREHOLDERS' EQUITY
    57,788,000       61,046,000  
 
  $ 78,913,000     $ 80,947,000  
 
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