8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION 

Washington, DC   20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)      July 21, 2016

Superior Uniform Group, Inc.

(Exact name of registrant as specified in its charter)

Florida	001-05869	11-1385670
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)
10055 Seminole Blvd., Seminole, Florida (Address of principal executive offices)		33772 (Zip Code)

Registrant's telephone number including area code: (727) 397-9611

Not Applicable

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230 .425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02. Results of Operations and Financial Condition

The following information is being furnished under Item 2.02 of Form 8-K: Press release by Superior Uniform Group, Inc. announcing its results of operations for the quarter ended June 30, 2016.

A copy of this press release is attached as Exhibit 99.1 to this Form 8-K.

Item 9.0l. Financial Statements and Exhibits

(c) Exhibits
Exhibit Number	Description
99.1	Press Release, dated July 21, 2016

Signature

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 thereunder duly authorized.

SUPERIOR UNIFORM GROUP, INC.
By:	/s/ Andrew D. Demott, Jr.
	Andrew D. Demott, Jr.
	Executive Vice President, Chief Financial Officer and Treasurer

Date: July 21, 2016

EXHIBIT INDEX

Exhibit Number	Description
99.1	Press Release, dated July 21, 2016

EX-99.1

Exhibit 99.1

NEWS RELEASE                         

Superior Uniform Group, Inc.

A NASDAQ Listed Company: SGC                    

10055 Seminole Boulevard

Seminole, Florida 33772-2539

Telephone (727) 397-9611

Fax (727) 803-2642

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

Superior Uniform Group, Inc. Reports Second Quarter Operating Results

● Net Sales Increase 19.5 Percent

● BAMKO Reports Net Sales of $9.8 million, an Increase of 88.7 Percent Over Prior Year Second Quarter 

SEMINOLE, Fla., July 21, 2016 (GLOBE NEWSWIRE) -- Superior Uniform Group, Inc. (NASDAQ:SGC), manufacturer of uniforms, career apparel, accessories and promotional products, today announced that for the second quarter ended June 30, 2016, net sales increased 19.5 percent to $64.7 million compared with 2015 second quarter net sales of $54.1 million. Net income for second quarter 2016 was $3.1 million, or $0.21 per diluted share, compared with $3.6 million, or $0.25 per diluted share, reported for the quarter ended June 30, 2015. 

For the six months ended June 30, 2016, net sales increased 22.1 percent to $122.6 million compared with net sales of $100.5 million for the six months ended June 30, 2015. Net income for the six months ended June 30, 2016 was $5.3 million, or $0.36 per diluted share, compared with $5.7 million, or $0.39 per diluted share reported for the six months ended June 30, 2015. As a result of the BAMKO acquisition, net income was negatively impacted by $0.2 million in pre-tax acquisition related expenses in the second quarter of 2016 and $1.1 million in the first six months of 2016.

-more- 

Michael Benstock, Chief Executive Officer, commented, “We are pleased to report a 19.5 percent increase in net sales in the second quarter. The increase in net sales for the second quarter came from net sales at BAMKO, which we acquired in March of this year, and from The Office Gurus, our remote staffing segment. Net sales in our uniforms segment leveled off in the second quarter following an exceptionally strong first quarter of 2016. Additionally, BAMKO has come out of the gate very strong, generating net sales of $9.8 million in the 2016 second quarter. This represents an increase of more than 88 percent versus the same period in 2015. We are very pleased with BAMKO and continue to work to achieve operational and sales synergies between the two organizations. The Office Gurus continues to grow at a very healthy rate with net sales to outside customers up 25.8 percent over the second quarter of 2015. At the end of the second quarter, we completed the building project in El Salvador and moved into a brand new, state-of-the-art, call center facility that nearly triples our capacity there. In addition to the acquisition of BAMKO and the new building in El Salvador, we continue to invest in our uniform business. Our new sewing factory in Haiti is progressing nicely and on schedule with our implementation plan. We expect it to achieve breakeven status by the end of 2016. 

“Our financial position remains strong, and we were able to pay down outstanding debt by $4.7 million in the second quarter of 2016. This financial strength positions us well to continue to invest in our businesses and to take advantage of opportunities as they arise.”

 -more-

CONFERENCE CALL

Superior Uniform Group will hold a conference call on Thursday, July 21, 2016 at 2:00 p.m. Eastern Time to discuss the Company’s results. Interested individuals may join the teleconference by dialing (844)-861-5505 for U.S. dialers and (412)-317-6586 for International dialers. The Canadian Toll Free number is (866)-605-3852. Please ask to be joined into the Superior Uniform Group call. The live webcast and archived replay can also be accessed in the investor information section of the Company’s website at www.SuperiorUniformGroup.com.

A telephone replay of the teleconference will be available one hour after the end of the call through 2:00 p.m. Eastern Time on July 28, 2016. To access the replay, dial (877) 344-7529 in the United States or (412) 317-0088 from international locations. Canadian dialers can access the replay at (855) 669-9658.  Please reference conference number 10088860 for all replay access.

About Superior Uniform Group, Inc.

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

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

 -more-

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.

 -more-

Comparative figures are as follows:

 SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Three Months Ended June 30, 

(Unaudited)

	2016		2015
Net sales	$	64,660,000	$	54,116,000
Costs and expenses:
Cost of goods sold		42,897,000		35,585,000
Selling and administrative expenses		16,956,000		13,008,000
Interest expense		192,000		129,000
		60,045,000		48,722,000
Income before taxes on income		4,615,000		5,394,000
Income tax expense		1,540,000		1,770,000
Net income	$	3,075,000	$	3,624,000
Weighted average number of shares outstanding during the period
(Basic)		14,120,617		13,730,646
(Diluted)		14,957,469		14,577,342
Per Share Data:
Basic
Net income	$	0.22	$	0.26
Diluted
Net income	$	0.21	$	0.25
Other comprehensive income, net of tax:
Defined benefit pension plans:
Recognition of net losses included in net periodic pension costs		171,000		129,000
Recognition of settlement loss included in net periodic pension costs		33,000		201,000
Gain on cash flow hedging activities		21,000		21,000
Foreign currency translation adjustment		173,000		-
Other comprehensive income		398,000		351,000
Comprehensive income	$	3,473,000	$	3,975,000
Cash dividends per common share	$	0.0825	$	0.075

 -more-

SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

Six Months Ended June 30,

(Continued)

(Unaudited)

	2016		2015
Net sales	$	122,628,000	$	100,463,000
Costs and expenses:
Cost of goods sold		80,844,000		66,136,000
Selling and administrative expenses		33,419,000		25,445,000
Interest expense		340,000		265,000
		114,603,000		91,846,000
Income before taxes on income		8,025,000		8,617,000
Income tax expense		2,690,000		2,950,000
Net income	$	5,335,000	$	5,667,000
Weighted average number of shares outstanding during the period
(Basic)		14,023,840		13,657,784
(Diluted)		14,813,064		14,562,713
Per Share Data:
Basic
Net income	$	0.38	$	0.41
Diluted
Net income	$	0.36	$	0.39
Other comprehensive income, net of tax:
Defined benefit pension plans:
Recognition of net losses included in net periodic pension costs		342,000		257,000
Recognition of settlement loss included in net periodic pension costs		198,000		201,000
Gain (loss) on cash flow hedging activities		6,000		(1,000	)
Foreign currency translation adjustment		294,000		-
Other comprehensive income		840,000		457,000
Comprehensive income	$	6,175,000	$	6,124,000
Cash dividends per common share	$	0.165	$	0.15

 -more-

SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

ASSETS

	June 30, 2016			December 31,
	(Unaudited)			2015
CURRENT ASSETS:
Cash and cash equivalents	$	4,735,000		$	1,036,000
Accounts receivable, less allowance for doubtful accounts of $1,100,000 and $848,000, respectively		37,091,000			29,914,000
Accounts receivable - other		2,137,000			3,262,000
Prepaid expenses and other current assets		11,150,000			6,214,000
Inventories*		63,161,000			63,573,000
TOTAL CURRENT ASSETS		118,274,000			103,999,000
PROPERTY, PLANT AND EQUIPMENT, NET		27,090,000			22,524,000
OTHER INTANGIBLE ASSETS, NET		24,428,000			14,222,000
GOODWILL		11,481,000			4,135,000
DEFERRED INCOME TAXES		4,760,000			4,980,000
OTHER ASSETS		2,392,000			1,871,000
	$	188,425,000		$	151,731,000
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable	$	15,397,000		$	11,775,000
Other current liabilities		7,883,000			8,307,000
Current portion of long-term debt		6,429,000			2,750,000
Current portion of acquisition-related contigent liabilities		1,969,000			1,787,000
TOTAL CURRENT LIABILITIES		31,678,000			24,619,000
LONG-TERM DEBT, net of issuance costs		36,898,000			21,131,000
LONG-TERM PENSION LIABILITY		8,347,000			8,925,000
LONG-TERM ACQUISITION-RELATED CONTINGENT LIABILITIES		7,361,000			3,866,000
OTHER LONG-TERM LIABILITIES		540,000			500,000
COMMITMENTS AND CONTINGENCIES (NOTE 5)
SHAREHOLDERS' EQUITY:
Preferred stock, $.001 par value - authorized 300,000 shares (none issued)		-			-
Common stock, $.001 par value - authorized 50,000,000 shares, issued and outstanding - 14,407,920 and 13,917,465, respectively.		14,000			14,000
Additional paid-in capital		40,982,000			33,806,000
Retained earnings		68,287,000			65,392,000
Accumulated other comprehensive income (loss), net of tax:
Pensions		(5,908,000	)		(6,448,000	)
Cash flow hedges		(68,000	)		(74,000	)
Foreign currency translation adjustment		294,000			-
TOTAL SHAREHOLDERS' EQUITY		103,601,000			92,690,000
	$	188,425,000		$	151,731,000

*  Inventories consist of the following:

	June 30,
	2016		December 31,
	(Unaudited)		2015
Finished goods	$	49,649,000	$	48,206,000
Work in process		955,000		860,000
Raw materials		12,557,000		14,507,000
	$	63,161,000	$	63,573,000

 -more-

SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

Six Months Ended June 30,

(Unaudited)

	2016			2015
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	5,335,000		$	5,667,000
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		2,333,000			1,890,000
Provision for bad debts - accounts receivable		180,000			211,000
Share-based compensation expense		983,000			964,000
Deferred income tax provision (benefit)		(69,000	)		(881,000	)
Loss on sales of property, plant and equipment		-			12,000
Accretion of acquisition-related contingent liability		81,000			65,000
Changes in assets and liabilities, net of acquisition of business:
Accounts receivable - trade		(2,181,000	)		(2,079,000	)
Accounts receivable - other		1,125,000			892,000
Inventories		653,000			(2,493,000	)
Prepaid expenses and other current assets		(1,648,000	)		(1,419,000	)
Other assets		(353,000	)		(41,000	)
Accounts payable		2,238,000			4,386,000
Other current liabilities		(1,350,000	)		(2,233,000	)
Long-term pension liability		259,000			567,000
Other long-term liabilities		40,000			40,000
Net cash provided by operating activities		7,626,000			5,548,000
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property, plant and equipment		(5,527,000	)		(2,099,000	)
Acquisition of business, net of acquired cash		(15,252,000	)		-
Net cash used in investing activities		(20,779,000	)		(2,099,000	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long-term debt		90,514,000			25,040,000
Repayment of long-term debt		(71,138,000	)		(26,638,000	)
Payment of cash dividends		(2,270,000	)		(2,006,000	)
Payment of contingent liability		(1,800,000	)		-
Proceeds received on exercise of stock options		781,000			1,383,000
Excess tax benefit from exercise of stock options and SARS		683,000			588,000
Net cash provided by (used in) financing activities		16,770,000			(1,633,000	)
Effect of currency exchange rates on cash		82,000			-
Net increase in cash and cash equivalents		3,699,000			1,816,000
Cash and cash equivalents balance, beginning of year		1,036,000			4,586,000
Cash and cash equivalents balance, end of period	$	4,735,000		$	6,402,000