10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

[X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2017

[ ] 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 001-05869

SUPERIOR UNIFORM GROUP, INC.

(Exact Name of Registrant as Specified in Its Charter)

Florida
(State or Other Jurisdiction
of Incorporation or Organization) 11-1385670
(I.R.S. Employer
Identification No.)

10055 Seminole Blvd.

Seminole, Florida 33772

(Address of Principal Executive Offices, including Zip Code)

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

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class	Name of Each Exchange on Which Registered
Common Stock, par value $.001 per share	NASDAQ Stock Market

Securities registered pursuant to Section 12(g) of the Act: N/A

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.

Yes                         No X     

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.

Yes                         No X     

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.

Yes X                      No        

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes  X                     No       

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. __

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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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               Accelerated filer   X      Non-accelerated filer            Smaller Reporting Company ___   Emerging Growth       

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 Act).

Yes                         No X      

At June 30, 2017, the aggregate market value of the registrant’s common shares held by non-affiliates, computed by reference to the last sales price ($22.35) as reported by the NASDAQ Stock Market, was approximately $228.3 million (based on the assumption, solely for purposes of this computation, that all directors and officers of the registrant were affiliates of the registrant).

The number of shares of common stock outstanding as of February 20, 2018 was 15,134,611 shares.

Documents Incorporated by Reference:

Portions of the registrant's Definitive Proxy Statement to be filed with the Commission not later than 120 days after the conclusion of the registrant’s fiscal year ended December 31, 2017, relating to its Annual Meeting of Shareholders to be held May 3, 2018, are incorporated by reference to furnish the information required by Items 10, 11, 12, 13 and 14 of Part III.

The exhibit index may be found on Pages 63 and 64.

PART I

References Used

References in this Form 10-K to “the Company,” “Superior,” “we,” “our,” or “us” mean Superior Uniform Group, Inc. together with its subsidiaries, except where the context otherwise requires. Unless otherwise indicated, all share and per share information in this Form 10-K has been adjusted for all periods presented to give retroactive effect to the 2-for-1 stock split effective on February 4, 2015.

Special Note Regarding Forward-Looking Statements

Certain matters discussed in this Form 10-K 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 Form 10-K may include, without limitation: (1) projections of revenue, income, and other items relating to our financial position and results of operations, (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; general economic conditions, including employment levels in the areas of the United States in which the Company’s customers are located; changes in the healthcare, industrial, commercial, leisure and public safety industries where uniforms and service apparel are worn; our ability to identify suitable acquisition targets, successfully integrate any acquired businesses, successfully manage our expanding operations, or discover liabilities associated with such businesses in the diligence process; the price and availability of cotton and other manufacturing materials; attracting and retaining senior management and key personnel, and those risks discussed under Item 1A of this report entitled “Risk Factors.” 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-K and we disclaim any obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.

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Item 1. Business

Overview

Superior Uniform Group, Inc. 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. (“Superior” or the “Company”) and its state of incorporation to Florida.

On July 1, 2013, the Company acquired substantially all of the assets of HPI Direct, Inc. (“HPI”), a company specializing in the design, manufacture and distribution of uniforms to major domestic retailers, foodservice chains, transportation and other service industries throughout the United States. The purchase price for the asset acquisition consisted of approximately $32.5 million in cash, and inclusive of the real estate purchase described below, the issuance of approximately 418,000 restricted shares of Superior’s common stock, the potential future payment of up to $7.2 million in additional contingent consideration through 2017, and the assumption of certain liabilities of HPI. The transaction also included the acquisition of the corporate offices and warehouse distribution facility from an entity related to HPI.

On March 8, 2016, the Company closed on the acquisition of substantially all of the assets of BAMKO, Inc..  The transaction had an effective date of March 1, 2016.  The purchase price for the asset acquisition consisted of approximately $15.2 million in cash, net of cash acquired, the issuance of approximately 324,000 restricted shares of Superior’s common stock that vests over a five-year period, the potential future payments of approximately $5.5 million in additional contingent consideration through 2021, and the assumption of certain liabilities of BAMKO, Inc.  The transaction also included the acquisition of BAMKO’s subsidiaries in Hong Kong, China, Brazil and England as well as an affiliate in India.  Depending on the context, when using the term “BAMKO” in this Form10-K, we refer either to the Company’s wholly-owned subsidiary housing the acquired business (BAMKO, LLC) or to the business acquired in the transaction, as subsequently grown through additional acquisitions.  BAMKO is a full-service merchandise sourcing and promotional products company based in Los Angeles.  With sales offices in the United States and Brazil, as well as support offices in China, Hong Kong, and India, BAMKO serves many well-known brands.

On August 21, 2017, the Company, through BAMKO, acquired substantially all of the assets of PublicIdentity, Inc. (“Public Identity”). Public Identity is a promotional products and branded merchandise agency that provides promotional products and branded merchandise to corporate clients and universities. The purchase price consisted of $0.8 million in cash, the issuance of approximately 54,000 restricted shares of Superior’s common stock and future payments of approximately $0.4 million in additional consideration through 2020. The majority of the shares issued vest over a three-year period.

On November 30, 2017, BAMKO closed on the acquisition of substantially all of the assets of Tangerine Promotions, Ltd and Tangerine Promotions West, Inc. (collectively, “Tangerine”), a promotional products and branded merchandise agency that serves many well-known brands.  Tangerine is one of the leading providers of Point-of-Purchase (POP) and Point-of-Sale (POS) merchandise in the country.  The transaction had an effective date of December 1, 2017.  The purchase price for the asset acquisition consisted of approximately $7.2 million in cash, subject to adjustment, the issuance of approximately 83,000 restricted shares of Superior’s common stock that vests over a four-year period, the potential future payments of approximately $5.5 million in additional contingent consideration through 2021, and the assumption of certain liabilities of Tangerine.

Superior has realigned its organizational structure and updated its reportable operating segments as a result of changes in its business primarily related to the acquisition of BAMKO effective March 1, 2016. A new Promotional Products segment has been created and consists of sales to customers of promotional products. Superior is now comprised of three reportable business segments: (1) Uniforms and Related Products, (2) Remote Staffing Solutions, and (3) Promotional Products. Superior’s Uniforms and Related Products segment, through its signature marketing brands Fashion Seal Healthcare^®, HPI Direct^®, Superior I.D.™, Worklon^®, and UniVogue^®, manufactures and sells a wide range of uniforms, corporate identity apparel, career apparel and accessories for the hospital and healthcare fields; hotels; fast food and other restaurants; transportation; and the private security, industrial and commercial markets. In excess of 95% of Superior’s Uniforms and Related Products segment’s net sales are from the sale of uniforms and service apparel and directly-related products. Because the addition of the Promotional Products segment did not affect the composition of Superior’s other two segments, the Company did not restate segment information for prior periods.

Superior services its Remote Staffing Solutions segment through multiple The Office Gurus entities, including its direct and indirect subsidiaries in El Salvador, Belize, and the United States, (collectively, “TOG”). TOG is a near-shore premium provider of cost effective multilingual telemarketing and total office support solutions.

The Promotional Products segment services customers that primarily purchase promotional and related products. The segment currently has sales offices in the United States and Brazil with support services in China, Hong Kong, and India.

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Products

Superior manufactures and sells a wide range of uniforms, corporate identity apparel, career apparel and accessories for the medical and health fields as well as for the industrial, commercial, leisure, and public safety markets in its Uniforms and Related Products segment. The Promotional Products segment produces and sells products for a wide variety of industries primarily to support marketing efforts.

Superior’s principal products are:

● Uniforms and service apparel and related products for personnel of:

● Hospitals and health facilities;

● Hotels, commercial buildings, residential buildings, and food service facilities;

● Retail stores;

● General and special purpose industrial uses;

● Commercial enterprises (career apparel for banks, airlines, etc.);

● Public and private safety and security organizations; and

● Miscellaneous service uses.

● Miscellaneous products:

● directly related to uniforms and service apparel specified above (e.g. boots and bags); and

● for use by linen suppliers and industrial launderers, to whom a substantial portion of Superior's uniforms and service apparel are sold; such products being primarily industrial laundry bags.

● for use by private safety and security organizations; and

● Miscellaneous service uses.

● Promotional and related products to support:

● Branded marketing programs;

● Event promotions;

● Employee rewards and incentives; and

● Specialty packaging and displays

Uniforms and related products are typically distributed through distribution centers in the United States. Promotional products are typically shipped directly from our vendors to our customers.

We do not consider sales in any of our segments to be highly seasonal.

For a depiction of revenues from external customers, income before taxes on income and total assets by segment for each of the years ended December 31, 2017, 2016 and 2015, please refer to “Note 17. Operating Segment Information:” in the notes to the consolidated financial statements in this Form 10-K.

During the years ended December 31, 2017, 2016 and 2015, uniforms and service apparel and related products accounted for approximately 77%, 83% and 94% of net sales; during the years ended December 31, 2017 and 2016, promotional and related products accounted for approximately 16% and 11% of net sales and no other single class of product listed above accounted for more than 10% of net sales.

Services

Through the recruitment and employment of highly qualified English-speaking agents, we provide our customers with extended office support from a versatile call and contact center environment in our Remote Staffing Solutions segment.

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Competition

Superior competes in its Uniforms and Related Products segment with more than three dozen firms, including divisions of larger corporations. Superior competes with national and regional manufacturers, such as Cintas Corporation, Unifirst Corporation and ARAMARK—a division of ARAMARK Corporation. Superior also competes with local firms in most major metropolitan areas. The nature and degree of competition varies with the customer and the market. Industry statistics are not available, but we believe Superior is one of the leading suppliers of garments to hospitals, industrial clean rooms, hotels, motels, and food service establishments, and uniforms to linen suppliers. Superior experiences competition primarily based on breadth of products offered, styling and pricing. We believe that the strength of our brands and marketing, coupled with the quality of our products, allow us to compete effectively.

The market in which TOG operates has evolved into a global multi-billion dollar marketplace that is highly competitive and fragmented.  TOG’s competitors in the Remote Staffing Solutions segment range in size from very small firms offering specialized services or short-term project completion to very large independent firms, and include the in-house operations of many customers and potential customers. We compete directly and indirectly with various companies that provide contact center and other business process solutions on an outsourced basis. These companies include, but are certainly not limited to, global providers such as APAC Customer Services, Convergys, Sitel, Atento, Sykes, Harte Hanks, and Teleperformance.   TOG also competes with local entities in other offshore geographies.  The list of potential competitors includes both publicly traded and privately held companies.

The promotional products industry is highly fragmented. We compete with a multitude of foreign, regional, and local competitors that vary by market. Major competitors in the Promotional Products segment include Staples, Inc. and BDA, Inc. We believe our creative services, product development, proprietary web platforms and our extensive global sourcing network along with our success with major brands will enable us to continue to be competitive and grow in this market.

Customers

The Uniform and Related Products segment has a substantial number of customers, the largest of which accounted for approximately 7.7% of that segment’s 2017 net sales. The Remote Staffing Solutions segment’s largest customer represented 17.9% of that segment’s 2017 external revenues, and the largest customer in the Promotional Products segment represented 7.6% of that segment’s net sales in 2017.

Backlog

The Uniform and Related Products segment normally completes shipments of orders from stock within one week after the receipt of the order. As of February 19, 2018, the backlog of all orders that we believe to be firm for our Uniform and Related Products segment was approximately $7.1 million, compared to approximately $6.6 million as of February 20, 2017. The Promotional Products segment typically produces custom products based upon confirmed orders. The average length of time to produce orders is four to six months. The backlog of all orders for our Promotional Products segment was approximately $25.0 million as of February 19, 2018 as compared to $12.8 million as of February 20, 2017.

Raw Materials, Working Capital and Inventory

The principal fabrics used in our Uniforms and Related Products segment are made from cotton, polyester, wool, silk, synthetic and cotton-synthetic blends.    The majority of such fabrics are sourced in the Far East. The raw materials used in the fabrics we source from our suppliers are primarily cotton, polyester yarn, dyestuffs and chemical components of synthetic fabrics. 

Superior’s Uniform and Related Products segment markets itself to its customers as a "stock house." Therefore, Superior at all times carries substantial inventories of raw materials (principally piece goods) and finished garments, which requires substantial working capital. The segment’s principal raw materials are textile products. In 2017 and 2016, approximately 32% and 32%, respectively, of the segment’s products were obtained from suppliers located in Central America and Haiti, and approximately 28% and 31%, respectively, were sourced from or contained raw materials sourced from China. Superior does not believe that it is dependent upon any of its suppliers, despite the concentration of its purchasing from a few sources, as other suppliers of the same or similar products are readily available. However, if Superior’s Uniform and Related Products segment is unable to continue to obtain its products from Central America, Haiti and China, it could significantly disrupt Superior’s business. Because the Company manufactures and sources products in Central America, Haiti and China, the Company is affected by economic and political conditions in those countries, including possible employee turnover, labor and other unrest and lack of developed infrastructure, as well as decisions by the U.S. government to impose or increase import duties or other import regulations.

The Promotional Products segment relies on the supply of different types of raw materials, including plastic, glass, fabric and metal. Prices within the promotional products industry are directly affected by the cost of raw materials. The market for promotional products is price sensitive and has historically exhibited price and demand cyclicality. The Promotional Products segment has flexibility in its suppliers, as other suppliers of the same or similar products are widely available. Additionally, the nature of the promotional products industry is such that should specific types of raw materials undergo significant cost increases, it is possible that alternative products using different materials could be utilized for similar promotional activities. However, if cost increases cannot be entirely passed on to customers and alternative suppliers or suitable product alternatives are unavailable, profit margins could decline. Moreover, in 2017 and 2016, because approximately 67% and 59%, respectively, of the raw materials and products sourced by the Promotional Products segment came from China, economic and political conditions in China or the United States, including those resulting in the imposition or increase of import duties and other import regulations, could have a material adverse effect on this business segment.

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Intellectual Property

Superior owns and uses several trademarks and service marks relating to its brands that have significant value and are instrumental to its ability to market its products. Superior’s most significant trademark is its mark "Fashion Seal Healthcare" (presently registered with the United States Patent and Trademark Office until 2027). The Fashion Seal Healthcare trademark is critically important to the marketing and operation of Superior’s business, as more than 22% of Superior's products are sold under that name.

Environmental Matters

In view of the nature of our business, compliance with federal, state, and local laws regulating the discharge of materials into the environment, or otherwise relating to the protection of the environment, has had no material effect upon our operations or earnings, and we do not expect it to have a material impact in the foreseeable future.

Employees

Superior employed 2,280 persons, of which 2,237 were full-time employees, as of December 31, 2017.

Securities Exchange Act Reports

The Company maintains an internet website at the following address: www.superioruniformgroup.com. The information on the Company's website is not incorporated by reference in this annual report on Form 10-K.

We make available on or through our website certain reports and amendments to those reports that we file with or furnish to the Securities and Exchange Commission (the "SEC") in accordance with the Securities Exchange Act of 1934, as amended (the "Exchange Act"). These include our annual reports on Form 10-K, our quarterly reports on Form 10-Q, our current reports on Form 8-K, and Section 16 filings by our officers, directors and 10% shareholders. We make this information available on our website free of charge as soon as reasonably practicable after we or they electronically file the information with, or furnish it to, the SEC.

Item 1A.     Risk Factors

Our business, operations and financial condition are subject to various risks, and many of those risks are driven by factors that we cannot control or predict. The following discussion addresses those risks that management believes are the most significant. You should take those risks into account in evaluating or making any investment decision involving the Company. Additional risks and uncertainties not presently known or that we currently believe to be less significant may also adversely affect us.

Risks Relating To Our Industry

We face intense competition within our industry and our revenue and/or profits may decrease if we are not able to respond to this competition effectively.

Customers in the uniform and corporate identity apparel industry and in the promotional products industry choose suppliers primarily based upon the quality, price and breadth of products offered. We encounter competition from a number of companies in the geographic areas we serve. Major competitors for our Uniforms and Related Products segment include publicly held companies such as Cintas Corporation, Unifirst Corporation, as well as ARAMARK — a division of ARAMARK Corporation. Major competitors for our Promotional Products segment include companies such as Staples, Inc. and BDA, Inc.. We also compete with a multitude of foreign, regional and local competitors that vary by market. If our existing or future competitors seek to gain or retain market share by reducing prices, we may be required to lower our prices, which would adversely affect our operating results. Similarly, if customers or potential customers perceive the products offered by our existing or future competitors to be of higher quality than ours or part of a broader product mix, our revenues may decline, which would adversely affect our operating results. In addition, our competitors generally compete with us for acquisition candidates, which can increase the price for acquisitions and reduce the number of acquisition candidates available to us.

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Regional or national economic slowdowns, high unemployment levels, or cost increases might have an adverse effect on our operating results.

Our primary products are provided to workers employed by our customers and, as a result, our business prospects are dependent upon levels of employment and overall economic conditions, among other factors. Our revenues are impacted by our customers’ opening and closing of locations and reductions and increases in headcount, including from voluntary turnover, which affect the quantity of uniform orders on a per-employee basis.

If we are unable to offset these effects through the addition of new customers (through acquisition or otherwise), the penetration of existing customers with a broader mix of product and service offerings, or decreased production costs that can be passed on in the form of lower prices, our revenue growth rates will be negatively impacted. Events or conditions in a particular geographic area, such as adverse weather and other factors, could also hurt our operating results. While we do not believe that our exposure is greater than that of our competitors, we could be adversely affected by increases in the prices of fabric, natural gas, gasoline, wages, employee benefits, insurance costs and other components of product cost unless we can recover such increases through proportional increases in the prices for our products and services. Competitive and general economic conditions might limit our ability and that of our competitors to increase prices to cover such increases in our product cost.

Volatility in the global financial markets could adversely affect results.

In the past, global financial markets have experienced extreme disruption, including, among other things, volatility in security prices, diminished liquidity and credit availability, rating downgrades of certain investments and declining valuations of others. In addition, global equity markets have been highly volatile recently. There can be no assurance that there will not be further change or volatility, which could lead to challenges in our business and negatively impact our financial results. The tightening of credit in financial markets adversely affects the ability of our customers and suppliers to obtain financing for significant purchases and operations and could result in a decrease in orders and spending for our products and services. We are unable to predict the likely duration and severity of any disruption in financial markets and adverse economic conditions and the effects they may have on our business and financial condition.

The uniform and corporate identity apparel and promotional products industries are subject to pricing pressures that may cause us to lower the prices we charge for our products and adversely affect our financial performance.

Many of our competitors source their product requirements from developing countries to achieve a lower cost operating environment, possibly with lower costs than our offshore facilities, and those manufacturers may use these cost savings to reduce prices. To remain competitive, we must adjust our prices from time to time in response to these industry-wide pricing pressures. Moreover, increased customer demands for allowances, incentives and other forms of economic support could reduce our gross margins and affect our profitability. Our financial performance may be negatively affected by these pricing pressures if we are forced to reduce our prices and we cannot reduce our product costs proportionally or if our product costs increase and we cannot increase our prices proportionately.

Increases in the price of finished goods and raw materials used to manufacture our products could materially increase our costs and decrease our profitability.

The principal fabrics used for our uniforms are made from cotton, wool, silk, synthetic and cotton-synthetic blends. The principal components in our promotional products are plastic, glass, fabric and metal. The prices we pay for these fabrics and components and our finished goods are dependent on the market price for the raw materials used to produce them, primarily cotton and chemical components of synthetic fabrics including raw materials such as chemicals and dyestuffs. These finished goods and raw materials are subject to price volatility caused by weather, supply conditions, government regulations, economic and political climate, currency exchange rates, labor costs, and other unpredictable factors.  Fluctuations in petroleum prices also may influence the prices of related items such as chemicals, dyestuffs and polyester yarn.

Any increase in raw material prices increases our cost of sales and can decrease our profitability unless we are able to pass the costs on to our customers in the form of higher prices. In addition, if one or more of our competitors is able to reduce their production costs by taking advantage of any reductions in raw material prices or favorable sourcing agreements, we may face pricing pressures from those competitors and may be forced to reduce our prices or face a decline in net sales, either of which could have a material adverse effect on our business, results of operations and financial condition.

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Changes to trade regulation, quotas, duties or tariffs, caused by the changing U.S. and geopolitical environments or otherwise, may increase our costs or limit the amount of products that we can import.

Our operations are subject to various international trade agreements and regulations, such as the Dominican Republic–Central America Free Trade Agreement (CAFTA-DR), Caribbean Basin Trade Partnership Act (CBTPA), Haitian Hemispheric Opportunity through Partnership Encouragement Act, as amended (HOPE), the Food Conservation and Energy Act of 2008 (HOPE II), the Haiti Economic Lift Program of 2010 (HELP), the African Growth and Opportunity Act (AGOA), and the activities and regulations of the World Trade Organization (WTO). Generally, these trade agreements benefit our business by reducing or eliminating the duties and/or quotas assessed on products manufactured in a particular country. However, trade agreements can also impose requirements that negatively affect our business, such as limiting the countries from which we can purchase raw materials or limiting the products that qualify as duty free, and setting duties or quotas on products that may be imported into the United States from a particular country. In addition, increased competition from developing countries could have a material adverse effect on our business, results of operations or financial condition.

The countries in which our products are manufactured or into which they are imported may from time to time impose new quotas, duties, tariffs and requirements as to where raw materials must be purchased to qualify for free or reduced duty. These countries may also create additional workplace regulations or other restrictions on our imports or adversely modify existing restrictions. Adverse changes in these costs and restrictions could harm our business. We cannot assure you that future trade agreements will not provide our competitors an advantage over us, or increase our costs, either of which could have a material adverse effect on our business, results of operations or financial condition. Nor can we assure you that the changing geopolitical and U.S. political environments will not result in a trade agreement or regulation being altered which adversely affects our company. Specifically, the current U.S. administration has voiced strong concerns about imports from countries that it perceives as engaging in unfair trade practices, and may decide to impose import duties or other restrictions on products or raw materials sourced from those countries, which may include China and other countries from which we import raw materials or in which we manufacture our products. Any such duties or restrictions could have a material adverse effect on our business, results of operations or financial condition.

The corporate identity apparel and uniform industry is subject to changing fashion trends and if we misjudge consumer preferences, the image of one or more of our brands may suffer and the demand for our products may decrease.

The apparel industry, including uniforms and corporate identity apparel, is subject to shifting customer demands and evolving fashion trends and our success is also dependent upon our ability to anticipate and promptly respond to these changes. Failure to anticipate, identify or promptly react to changing trends or styles may result in decreased demand for our products, as well as excess inventories and markdowns, which could have a material adverse effect on our business, results of operations, and financial condition. In addition, if we misjudge consumer preferences, our brand image may be impaired. We believe our products are, however, in general, less subject to fashion trends compared to many other apparel manufacturers because we manufacture and sell uniforms, corporate identity apparel and other accessories.

Risks Relating To Our Business

Our success depends upon the continued protection of our trademarks and other intellectual property rights and we may be forced to incur substantial costs to maintain, defend, protect and enforce our intellectual property rights.

Our owned intellectual property and certain of our licensed intellectual property have significant value and are instrumental to our ability to market our products. While we own and use several trademarks, our “Fashion Seal Healthcare” mark is critically important to our business, as more than 22% of our products are sold under that name.  We cannot assure you that our owned or licensed intellectual property or the operation of our business does not infringe on or otherwise violate the intellectual property rights of others.  We cannot assure you that third parties will not assert claims against us on any such basis or that we will be able to successfully resolve such claims.  In addition, although we seek international protection of our intellectual property, the laws of some foreign countries may not allow us to protect, defend or enforce our intellectual property rights to the same extent as the laws of the United States. We could also incur substantial costs to defend legal actions relating to use of our intellectual property or prosecute legal actions against others using our intellectual property, either of which could have a material adverse effect on our business, results of operations or financial condition. There also can be no assurance that we will be able to negotiate and conclude extensions of existing license agreements on similar economic terms or at all.

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Our customers may cancel or decrease the quantity of their orders, which could negatively impact our operating results.

Although we have long-standing customer relationships, we do not have long-term contracts with many of our customers. Sales to many of our customers are on an order-by-order basis. If we cannot fill customers’ orders on time, orders may be cancelled and relationships with customers may suffer, which could have an adverse effect on us, especially if the relationship is with a major customer. Furthermore, if any of our customers experience a significant downturn in their business, or fail to remain committed to our programs or brands, the customer may reduce or discontinue purchases from us. The reduction in the amount of our products purchased by customers could have a material adverse effect on our business, results of operations or financial condition.

In addition, some of our customers have experienced significant changes and difficulties, including consolidation of ownership, increased centralization of buying decisions, restructurings, bankruptcies and liquidations. A significant adverse change in a customer relationship or in a customer’s financial position could cause us to limit or discontinue business with that customer, require us to assume more credit risk relating to that customer’s receivables or limit our ability to collect amounts related to previous purchases by that customer, all of which could have a material adverse effect on our business, results of operations or financial condition.

We pursue acquisitions from time-to-time to expand our business, which may pose risks to our business.

We selectively pursue acquisitions from time to time as part of our growth strategy. We compete with others within our industry for suitable acquisition candidates. This competition may increase the price for acquisitions and reduce the number of acquisition candidates available to us. As a result, acquisition candidates may not be available to us in the future on favorable terms.

Even if we are able to acquire businesses on favorable terms, managing growth through acquisition is a difficult process that includes integration and training of personnel, combining plant and operating procedures, and additional matters related to the integration of acquired businesses within our existing organization. Unanticipated issues related to integration may result in additional expense and in disruption to our operations, and may require a disproportionate amount of our management’s attention, any of which could negatively impact our ability to achieve anticipated benefits, such as cost synergies. Growth of our business through acquisitions will also likely require us to increase our work force and the scope of our operating and financial systems and may require us to increase the geographic area of our operations. This would increase our operating complexity and the level of responsibility for both existing and new management personnel. Managing and sustaining our growth and expansion may require substantial enhancements to our operational and financial systems and controls, as well as additional administrative, operational and financial resources. There can be no assurance that we will be successful in integrating acquired businesses or managing our expanding operations.

In addition, although we conduct due diligence investigations prior to each acquisition, there can be no assurance that we will discover or adequately protect against all material liabilities of an acquired business for which we may be responsible as a successor owner or operator. The failure to identify suitable acquisitions, successfully integrate these acquired businesses, successfully manage our expanding operations, or to discover liabilities associated with such businesses in the diligence process, could adversely affect our business, results of operations or financial condition.

In order to finance such acquisitions, we may need to obtain additional funds either through public or private financings, including bank and other secured and unsecured borrowings and/or the issuance of equity or debt securities. There can be no assurance that such financings would be available to us on reasonable terms. Any future issuances of equity securities or debt securities with equity features may be dilutive to our shareholders.

If our information technology systems suffer interruptions or failures, including as a result of cyber-attacks, our business operations could be disrupted and our reputation could suffer.

We rely on information technology systems to process transactions, communicate with customers, manage our business, and process and maintain information The measures we have in place to monitor and protect our information technology systems might not offer sufficient protection from catastrophic events, power surges, viruses, malicious malware, attempts to gain unauthorized access to data or other types of cyber-based attacks. Cyber based attacks in particular are becoming more frequent, sophisticated and damaging. Any such events could product disruptions that result in an unexpected delay in operations, loss of confidential or otherwise protected information, corruption of data, and expenses related to the repair or replacement of our information technology systems. Compromising and/or loss of information could result in loss of sales or legal or regulatory claims which could adversely affect our revenues and profits or damage our reputation.

We have significant pension obligations with respect to our employees and our available cash flow may be adversely affected in the event that payments become due under any pension plans that are unfunded or underfunded.

A portion of our active and retired employees participate in defined benefit pension plans under which we are obligated to provide prescribed levels of benefits regardless of the value of the underlying assets, if any, of the applicable pension plan. If our obligations under a plan are unfunded or underfunded, we will have to use cash flow from operations and other sources to pay our obligations either as they become due or over some shorter funding period. As of December 31, 2017, we had approximately $8.4 million in unfunded or underfunded obligations related to our pension plans, compared to $9.5 million as of December 31, 2016.

9

We are subject to international, federal, state and local laws and regulations and failure to comply with them may expose us to potential liability.

We are subject to international, federal, state and local laws and regulations affecting our business, including those promulgated under the Occupational Safety and Health Act, the Consumer Product Safety Act, the Flammable Fabrics Act, the Textile Fiber Product Identification Act, the rules and regulations of the Consumer Products Safety Commission and various labor, workplace and related laws, as well as environmental laws and regulations. Failure to comply with such laws may expose us to potential liability and have an adverse effect on our results of operations.

Shortages of supply of sourced goods or raw materials from suppliers, interruptions in our manufacturing, and local conditions in the countries in which we operate could adversely affect our results of operations.

We utilize multiple supply sources and manufacturing facilities. However, an unexpected interruption in any of the sources or facilities could temporarily adversely affect our results of operations until alternate sources or facilities can be secured. In 2017 and 2016, approximately 28% and 31%, respectively, of products for our Uniform and Related Products segment were sourced from or contained raw materials sourced from China. In 2017 and 2016, approximately 32% and 32%, respectively, of products for our Uniform and Related Products segment were obtained from suppliers located in Central America and Haiti. In 2017 and 2016, approximately 67% and 59%, respectively, of our products for our Promotional Products segment were sourced from China. If we are unable to continue to obtain our products from China, Central America and/or Haiti, it could significantly disrupt our business. Because we source products and raw materials and maintain operations in these locations, we are affected by economic and political conditions in those countries, including possible employee turnover, labor and other unrest and lack of developed infrastructure, as well as decisions by the U.S. government to impose or increase import duties or other import regulations.

Our business may be impacted by adverse weather and other unpredicted events

Our corporate headquarters is located in Florida, which is a hurricane-sensitive area. Should a hurricane occur, the possibly resulting infrastructure damage and disruption to the area could negatively affect Superior, such as by damage to, or total destruction of, our headquarters, surrounding transportation infrastructure, network communications, and other forms of communication. Some of our suppliers, such as those located in Central America and Haiti, are exposed to hurricanes and earthquakes; the damages that such events could produce could affect the supply of our products. In addition, similar disruptions to the business of our customers located in areas affected by hurricanes or earthquakes may adversely impact sales of our products.

Implementation of technology initiatives could disrupt our operations in the near term and fail to provide the anticipated benefits.

As our business grows, we continue to make significant investments in our technology, including in the areas of warehouse management and product design. The costs, potential problems and interruptions associated with the implementation of technology initiatives could disrupt or reduce the efficiency of our operations in the near term. They may also require us to divert resources from our core business to ensure that implementation is successful. In addition, new or upgraded technology might not provide the anticipated benefits; it might take longer than expected to realize the anticipated benefits; the technology might fail or cost more than anticipated.

Our Remote Staffing Solutions business is dependent on the trend toward outsourcing.

Our business and growth depend in large part on the industry trend toward outsourced customer contact management services. Outsourcing means that an entity contracts with a third party, such as us, to provide customer contact services rather than perform such services in-house. There can be no assurance that this trend will continue, as organizations may elect to perform such services themselves. A significant change in this trend could have a material adverse effect on our business, financial condition and results of operations.

Inability to attract and retain key management or other personnel could adversely impact our business.

Our success is dependent on the skills, experience, and efforts of our senior management and other key personnel.  If, for any reason, one or more senior executive or key personnel was not to remain active in our company, or if we were unable to attract and retain senior management or key personnel, our results of operations could be adversely affected.

10

Certain existing shareholders have significant control.

At December 31, 2017, our executive officers, Directors, and certain of their family members collectively owned 35.2% of our outstanding common stock. As a result, our executive officers and certain of their family members have significant influence over the election of our Board of Directors, the approval or disapproval of any other matters requiring shareholder approval, and the affairs and policies of our company.

Item 1B. Unresolved Staff Comments

None.

Item 2. Properties

As of December 31, 2017, the Company owned or leased approximately 24 facilities containing an aggregate of approximately 957,000 square feet located in the United States, Central America, South America, Haiti and Asia, which are used for manufacturing, distribution, and office space supporting our Uniforms and Related Products, Remote Staffing Solutions, and Promotional Products segments. Our owned facilities total approximately 452,000 square feet, including our 66,000 square feet corporate headquarters in Seminole, Florida (which also houses a call center and is involved with all of our segments), and 75,000 square feet warehousing and distribution location in Alpharetta, GA (used in conjunction with our Uniforms and Related Products segment), and 43,000 square feet call center in El Salvador (which serves our Remote Staffing Solutions segment). Our principal Promotional Products locations are leased office space in Los Angeles, CA and Chicago, IL; we also lease office space for use with this segment in other countries, including Brazil, India and China. Our distribution center in Eudora, AR, which is used primarily for our Uniforms and Related Products segment, is rented for a nominal amount from a municipality providing incentives for businesses to locate in that area and may be purchased for a nominal amount.

The Company has an ongoing program designed to maintain and improve its facilities. The Company's properties have adequate productive capacity to meet the Company’s present needs as well as those of the foreseeable future.

Item 3. 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 4. Mine Safety Disclosures

Not applicable.

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

The principal market on which Superior's common shares are traded is the NASDAQ Stock Market under the symbol “SGC”.

The following table sets forth the high and low sales prices and cash dividends declared on our common stock by quarter for 2017 and 2016 as reported in the consolidated transaction reporting system of the NASDAQ Stock Market.

	QUARTER ENDED
	2017								2016
	Mar. 31		June 30		Sept. 30		Dec. 31		Mar. 31		June 30		Sept. 30		Dec. 31
Common Shares:
High	$	19.69	$	23.33	$	23.63	$	28.85	$	18.27	$	20.45	$	20.50	$	21.02
Low	$	16.65	$	17.13	$	20.70	$	22.24	$	13.71	$	15.79	$	15.53	$	15.79
Dividends (total for 2017-$0.37; 2016-$0.34)	$	0.088	$	0.088	$	0.095	$	0.095	$	0.083	$	0.083	$	0.088	$	0.088

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We declared cash dividends of $0.0875 per share in the first and second quarters and $0.095 per share in the third and fourth quarters during the fiscal year ended December 31, 2017.

We intend to pay regular quarterly distributions to our holders of common shares, the amount of which may change from time to time; however, there can be no assurances that we will in fact pay such distributions on a regular basis. Future distributions will be declared and paid at the discretion of our Board of Directors, and will depend upon cash generated by operating activities, our financial condition, capital requirements, and such other factors as our Board of Directors deem relevant.

Under our credit agreement with Branch Banking and Trust Company (“BB&T”), if an event of default exists, we may not make distributions to our shareholders. The Company is in full compliance with all terms, conditions and covenants of its credit agreement.

On December 29, 2014, the Board of Directors declared a 2-for-1 stock split of the Company’s common stock. The record date for the split was January 12, 2015, and the stock split became effective on February 4, 2015.

On February 20, 2018, we had 153 shareholders of record and the closing price for our common shares on the NASDAQ Stock Market was $24.37 per share.

Information regarding the Company’s equity compensation plans is incorporated by reference to the information set forth in Item 12 of Part III of this Form 10-K under the section entitled “Equity Compensation Plan Information.”

12

Stock Performance Graph

The following graph shows a five-year comparison of the cumulative total return on $100 invested in our common stock, The NASDAQ Composite Index and The NYSE MKT Wholesale and Retail Trade Index, which is comprised of all NYSE American companies with SIC codes from 5000 through 5999.

The graph illustrates the cumulative values at the end of each succeeding fiscal year resulting from the change in the stock price, assuming a reinvestment of dividends. Over the five year period, Superior Uniform Group, Inc. stock grew to $512.74, compared to $242.29 for the NASDAQ Composite Index and $114.87 for the NYSE Wholesale and Retail Trade Index.

	12/12		12/13		12/14		12/15		12/16		12/17
Superior Uniform Group		100.00		136.44		266.84		314.06		369.92		512.74
NASDAQ Composite		100.00		141.63		162.09		173.33		187.19		242.29
NYSE MKT Wholesale and Retail Trade Index		100.00		139.71		122.06		95.92		114.65		114.87

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Issuer Purchases of Equity Securities

The table below sets forth information with respect to purchases made by or on behalf of Superior Uniform Group, Inc. or any “affiliated purchaser” (as defined in Rule 10b-18(a)(3) under the Exchange Act) of our common shares during the three months ended December 31, 2017.

Period	(a) Total Number of Shares Purchased	(b) Average Price Paid per Share	(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	(d) Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs1
Month #1
(October 1, 2017 to	-	-	-
October 31, 2017)
Month #2
(November 1, 2017 to	-	-	-
November 30, 2017)
Month #3
(December 1, 2017 to	-	-	-
December 31, 2017)
TOTAL	-	-	-	216,575

¹On August 1, 2008, the Company’s Board of Directors approved an increase to the outstanding authorization to allow for the repurchase of 1,000,000 additional shares of the Company’s outstanding shares of common stock. There is no expiration date or other restriction governing the period over which we can make our share repurchases under the program. All such purchases were open market transactions.

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Item 6.          Selected Financial Data

You should read the following selected consolidated financial data together with our consolidated financial statements and the related notes and with "Item 7" - Management's Discussion and Analysis of Financial Condition and Results of Operations" included in this Form 10-K.

We have derived the consolidated statement of operations data for the years ended December 31, 2017, 2016, and 2015 and the consolidated balance sheet data as of December 31, 2017 and 2016 from our audited consolidated financial statements, which are included elsewhere in this Form 10-K. We have derived the consolidated statements of operations data for the years ended December 31, 2014 and 2013 and the consolidated balance sheet data as of December 31, 2015, 2014, and 2013 from our audited consolidated financial statements that are not included in this Form 10K. Our historical results for any prior period are not indicative of results to be expected in any future period.

SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES

FIVE YEAR FINANCIAL SUMMARY

YEARS ENDED DECEMBER 31,

(In thousands, except per share amounts)

	2017		2016		2015		2014		2013
Net sales	$	266,814	$	252,596	$	210,317	$	196,249	$	151,496
Costs and expenses:
Cost of goods sold		170,462		165,614		138,884		127,512		98,938
Selling and administrative expenses		71,816		66,396		52,018		50,724		43,873
Interest expense		802		688		519		484		195
		243,080		232,698		191,421		178,720		143,006
Gain on sale of property, plant and equipment		1,048		-		-		-		-
Income before taxes on income		24,782		19,898		18,896		17,529		8,490
Taxes on income		9,760		5,260		5,830		6,180		2,640
Net income	$	15,022	$	14,638	$	13,066	$	11,349	$	5,850
Per Share Data:
Basic
Net income	$	1.04	$	1.04	$	0.95	$	0.85	$	0.47
Diluted
Net income	$	0.99	$	0.98	$	0.90	$	0.82	$	0.46
Cash dividends per common share	$	0.365	$	0.340	$	0.315	$	0.285	$	0.068
At year end:
Total assets	$	218,938	$	196,848	$	151,731	$	139,937	$	125,494
Long-term debt	$	32,933	$	36,227	$	21,131	$	22,660	$	24,500
Working capital	$	95,315	$	93,107	$	79,380	$	77,191	$	69,801
Shareholders' equity	$	124,968	$	110,550	$	92,690	$	80,412	$	71,935

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with our consolidated financial statements, which present our results of operations for the years ended December 31, 2017, 2016 and 2015, as well as our financial positions at December 31, 2017 and 2016, contained elsewhere in this Form 10-K. Some of the information contained in this discussion and analysis or set forth elsewhere in this Form 10-K, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. You should review the “Special Note Regarding Forward Looking Statements” and “Risk Factors” sections of this Form 10-K for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis.

Recent Acquisitions

As described in “Item 1. Business – Overview,” on March 8, 2016, the Company closed on the acquisition of substantially all of the assets of BAMKO, Inc. with an effective date of March 1, 2016.  BAMKO is a full-service merchandise sourcing and promotional products company based in Los Angeles, CA.  The purchase price for the asset acquisition consisted of approximately $15.2 million cash, net of cash acquired, the issuance of approximately 324,000 restricted shares of Superior’s common stock that vests over a five-year period, the potential future payments of approximately $5.5 million in additional contingent consideration through 2021, and the assumption of certain liabilities of BAMKO.  Depending on the context, when using the term “BAMKO” in this Form 10-K, we refer either to the Company’s wholly-owned subsidiary housing the acquired business (BAMKO, LLC) or to the business acquired in the transaction, as subsequently grown through additional acquisitions.

On August 21, 2017, the Company, BAMKO, acquired substantially all of the assets of PublicIdentity, Inc. (“Public Identity”).  Public Identity is a promotional products and branded merchandise agency that provides promotional products and branded merchandise to corporate clients and universities. The purchase price consisted of $0.8 million in cash, the issuance of approximately 54,000 restricted shares of Superior’s common stock and future payments of approximately $0.4 million in additional consideration through 2020. The majority of the shares issued vest over a three-year period.

On November 30, 2017, BAMKO closed on the acquisition of substantially all of the assets of Tangerine Promotions, Ltd. and Tangerine Promotions West, Inc. (collectively “Tangerine”). The transaction had an effective date of December 1, 2017.  Tangerine is a promotional products and branded merchandise agency that serves many well-known brands.  The company is one of the leading providers of Point-of-Purchase (POP) and Point-of-Sale (POS) merchandise in the country.  The purchase price for the asset acquisition consisted of approximately $7.2 million in cash, subject to adjustment, the issuance of approximately 83,000 restricted shares of Superior’s common stock that vests over a four-year period, the potential future payments of approximately $5.5 million in additional contingent consideration through 2021, and the assumption of certain liabilities of Tangerine.

Primarily as a result of its acquisition of BAMKO, Superior realigned its organizational structure and updated its reportable operating segments. A new Promotional Products segment has been created and consists of sales to customers of promotional products. Superior is now comprised of three reportable business segments: (1) Uniforms and Related Products, (2) Remote Staffing Solutions, and (3) Promotional Products.

Business Outlook

Uniforms and Related Products

Historically, we have manufactured and sold a wide range of uniforms, career apparel and accessories, which comprises our Uniforms and Related Products segment.  Our primary products are provided to workers employed by our customers and, as a result, our business prospects are dependent upon levels of employment and overall economic conditions, among other factors.  Our revenues are impacted by our customers’ opening and closing of locations and reductions and increases in headcount. Additionally, voluntary employee turnover at our customers can have a significant impact on our business.  The current economic environment in the United States is continuing to see moderate improvement in the employment environment and voluntary employee turnover has been increasing.  We also continue to see an increase in the demand for employees in the healthcare sector.  These factors are expected to have positive impacts on our prospects for growth in net sales in 2018.

We have continued our efforts to increase penetration of the health care market. We have been and continue to pursue acquisitions to increase our market share in the Uniforms and Related Products segment.

16

Remote Staffing Solutions

This business segment, which operates in El Salvador, Belize and the United States, was initially started to provide remote staffing services for the Company at a lower cost structure in order to improve our own operating results.   It has in fact enabled us to reduce operating expenses in our Uniforms and Related Products segment and to more effectively service our customers’ needs in that segment.  We began selling remote staffing services to other companies at the end of 2009. We have grown this business from approximately $1.0 million in net sales to outside customers in 2010 to approximately $19.3 million in net sales to outside customers in 2017.  We have spent significant effort over the last several years improving the depth of our management infrastructure and expanding our facilities in this segment to support significant growth in this segment in 2018 and beyond.  We increased net sales to outside customers in this segment by approximately 34% in 2017 compared to 2016, 20% in 2016 as compared to 2015 and 49% in 2015 compared to 2014.

Promotional Products

We have been involved in the sale of promotional products, on a limited basis, to our Uniforms and Related Products customers for over a decade. However, we lacked the scale and expertise to be a recognized name in this market prior to our acquisition of substantially all of the assets of BAMKO effective March 1, 2016. BAMKO has been operating in the promotional products industry for more than 15 years and we believe that BAMKO’s strong back office and support systems located in India, China and Hong Kong, as well as their “direct to factory” sourcing operations provide us with a competitive advantage. We believe that BAMKO has well developed systems and processes that can serve as a platform for additional acquisitions that we expect to complete in this highly fragmented market - we believe this product line is a synergistic fit with our uniform business. We completed two additional acquisitions in this segment in late 2017.

Year Ended December 31, 2017 vs. 2016

Operations

Net Sales

(In thousands, except percentages)
	2017			2016			% Change
Uniforms and Related Products	$	204,644		$	210,373			(2.7	%)
Remote Staffing Solutions		23,021			17,953			28.2
Promotional Products		42,904			27,816			54.2
Net intersegment eliminations		(3,755	)		(3,546	)		5.9
Consolidated Net Sales	$	266,814		$	252,596			5.6	%

Net Sales

Net sales for the Company increased 5.6% from $252.6 million in 2016 to $266.8 million in 2017.   The aggregate increase in net sales is attributed to the acquisitions of BAMKO effective March 1, 2016, Public Identity on August 21, 2017, and Tangerine on December 1, 2017 (contributing 6.0%), increases in net sales after intersegment eliminations from our Remote Staffing Solutions segment (contributing 1.9%), partially offset by a reduction in net sales from our Uniforms and Related Products segment (contributing a decrease of 2.3%).

Uniforms and Related Products net sales decreased 2.7% in 2017 compared to 2016. The decrease in net sales in this segment is attributed to several factors. One of our larger customers was acquired by one of its competitors in 2016. The acquiring company was serviced by a different uniform provider that has taken over this account. We will continue to service this customer at a reduced rate. The net reduction from this customer was approximately $4.6 million. The reduction of recurring sales to this customer was partially offset by sales of remaining inventory in the second quarter. Finally, one of our large customers elected not to repeat two large promotional uniform programs that have been a part of their business for several years now. This resulted in a decrease in net sales of approximately $2.9 million. These decreases were partially offset by continued market penetration and increases in voluntary employee turnover.

Remote Staffing Solutions net sales increased 28.2% before intersegment eliminations and 33.7% after intersegment eliminations in 2017. These increases are attributed to continued market penetration in 2017, both with respect to new and existing customers.

Promotional Products net sales increased 54.2% in 2017 compared to the period from the BAMKO acquisition date of March 1, 2016 through December 31, 2016. The increase is partially due to two additional months of sales in 2017 (contributing 23.0%), and two acquisitions in the latter part of 2017 (contributing 16.0%). The balance of the increase is primarily due to new customer acquisitions and expanded programs with existing customers.

17

Cost of Goods Sold

Cost of goods sold consists primarily of direct costs of acquiring inventory, including cost of merchandise, inbound freight charges, purchasing costs, and inspection costs for our Uniforms and Related Products and Promotional Products segments. Cost of goods sold for our Remote Staffing Solutions segment includes salaries and payroll related benefits for agents. The Company includes shipping and handling fees billed to customers in net sales. Shipping and handling costs associated with out-bound freight are generally recorded in cost of goods sold. Other shipping and handling costs are included in selling and administrative expenses.

As a percentage of net sales, cost of goods sold for our Uniforms and Related Products segment was 64.6% in 2017 and 66.7% in 2016. The decrease as a percentage of net sales is primarily attributed to a decrease in direct product costs as a percentage of net sales during 2017.

As a percentage of net sales, cost of goods sold for our Remote Staffing Solutions segment was 45.9% in 2017, and 46.4% in 2016. The percentage decrease in 2017 as compared to 2016 is primarily attributed to a decrease in the percentage of segment revenue coming from the domestic portion of our Remote Staffing Solutions segment from 29.2% in 2016 to 19.8% in 2017. The hourly rates charged for domestic services are higher than offshore services but the margin percentage earned is lower.

As a percentage of net sales, cost of goods sold for our Promotional Products segment was 67.7% in 2017 and 65.2% in 2016. Cost of goods sold as a percentage of revenue for this segment can fluctuate based on the service requirements of individual contracts.

Selling and Administrative Expenses

As a percentage of net sales, selling and administrative expenses for our Uniforms and Related Products segment approximated 24.8% in 2016 and 26.4% in 2017. The increase as a percentage of net sales was primarily due to lower net sales in 2017 to cover operating expenses (contributing 0.7%) and increased salaries, wages and benefits exclusive of medical costs (contributing 0.5%), higher bad debt expense due primarily to a customer bankruptcy (contributing 0.3%) and other minor increases (contributing 0.3%). These increases were partially offset by lower medical claims in 2017 (contributing 0.2%).

As a percentage of net sales, selling and administrative expenses for our Remote Staffing Solutions segment approximated 34.2% in 2017 and 34.0% in 2016. The increase as a percentage of net sales is attributed primarily to an increase in payroll related costs (contributing 3.3%), higher broker fees (contributing 1.1%), higher facilities costs and depreciation due to our expanded facility in El Salvador (contributing 2.2%) and other minor increases (contributing 3.4%). These increases were mostly offset by higher net sales to cover operating expenses (contributing 9.8%).

As a percentage of net sales, selling and administrative expenses for our Promotional Products segment were 28.4% in 2017 and 37.3% from the BAMKO acquisition date of March 1, 2016 through December 31, 2016. Included within these expenses for 2017 was approximately $0.3 million in of expenses for acquisitions. Included within these expenses for 2016 was approximately $1.1 million of expenses associated with the BAMKO acquisition. Net of these acquisition related expenses, selling and administrative expenses would have been 27.3% of net sales in 2017 and 33.2% of net sales in 2016. The decrease is primarily related to higher sales to cover operating costs, partially offset by a higher payroll related costs (contributing 1.8%) and a lower gain on foreign currency (contributing 0.9%).

Gain on Sale of Property, Plant and Equipment

In the quarter ended March 31, 2017, we sold our former call center building and related assets in El Salvador in our Remote Staffing Solutions segment for net proceeds of $2.8 million and realized a gain on sale of $1.0 million.

Interest Expense

Interest expense increased to $0.8 million for the year ended December 31, 2017 from $0.7 million for the year ended December 31, 2016. This increase is attributed primarily to higher average borrowings outstanding primarily due to the BAMKO acquisition.

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Income Taxes

On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (“Tax Act”) that instituted fundamental changes to the U.S. tax system. The Tax Act includes changes to the taxation of foreign earnings by implementing a dividend exemption system, expansion of the current anti-deferral rules, a minimum tax on low-taxed foreign earnings and new measures to deter base erosion. The Tax Act also permanently reduces the corporate tax rate from 34% to 21%, imposes a one-time mandatory transition tax on the historical earnings of foreign affiliates and implements a territorial style tax system. The impacts of these changes are reflected in the 2017 tax expense which resulted in a provisional charge of approximately $4.0 million, which is subject to adjustment given the provisional nature of the charge. This resulted in an effective tax rate higher than the statutory rate in 2017. As a result of the transition tax under The Act, the Company will no longer consider its undistributed earnings from foreign subsidiaries as indefinitely reinvested and has provided a deferred tax liability primarily for foreign withholding taxes that would be expected to apply when the Company dividends these earnings back to the United States. The effective income tax rate in 2017 was 39.4% and in 2016 was 26.4%.  The 13.0% increase in the effective tax rate is attributed primarily to the Tax Act (17.1%) and other increases (0.1), partially offset by an increase in the benefit of foreign sourced income (1.4%) and an increase in the excess tax benefit associated with share based compensation (2.8%).

The Company currently expects an effective tax rate for 2018 to be slightly below the statutory rate. The effective tax rate may vary from quarter to quarter due to unusual or infrequently occurring items, the resolution of income tax audits, changes in tax laws, the tax impact from employee share-based payments, taxes incurred in connection to the territorial style tax system, or other items.

The Tax Act imposes a U.S. tax on global intangible low taxed income (“GILTI”) that is earned by certain foreign affiliates owned by a U.S. shareholder. The computation of GILTI is still subject to interpretation and additional clarifying guidance is expected, but is generally intended to impose tax on the earnings of a foreign corporation that are deemed to exceed a certain threshold return relative to the underlying business investment. In accordance with guidance issued by FASB, the Company has made a policy election to treat future taxes related to GILTI as a current period expense in the reporting period in which the tax is incurred. The company does expect to be impacted by GILTI relative to the earnings of its foreign subsidiaries in 2018 and beyond.

For further discussion of changes in the effective tax rate, refer to the Note 7 to the Consolidated Financial Statements.

Year Ended December 31, 2016 vs. 2015

Operations

Net Sales

(In thousands, except percentages)
	2016			2015			% Change
Uniforms and Related Products	$	210,373		$	198,319			6.1	%
Remote Staffing Solutions		17,953			15,604			15.1
Promotional Products		27,816			-			N/A
Net intersegment eliminations		(3,546	)		(3,606	)		(1.7	)
Consolidated Net Sales	$	252,596		$	210,317			20.1	%

Net Sales

Net sales for the Company increased 20.1% from $210.3 million in 2015 to $252.6 million in 2016. The aggregate increase in net sales is split between growth in our Uniforms and Related Products segment (contributing 5.8%), increases in net sales after intersegment eliminations from our Remote Staffing Solutions segment (contributing 1.1%) and the effect of the acquisition of BAMKO in our new Promotional Products segment (contributing 13.2%).

Uniforms and Related Products net sales increased 6.1% in 2016 compared to 2015. The increase in net sales is attributed primarily to our continued market penetration as well as continued increases in voluntary employee turnover in the marketplace.

Remote Staffing Solutions net sales increased 15.1% before intersegment eliminations and 20.1% after intersegment eliminations in 2016. These increases are attributed to continued market penetration in 2016, both with respect to new and existing customers.

Promotional Products net sales of $27.8 million, from the acquisition date of March 1, 2016 through December 31, 2016 represented 11.0% of consolidated net sales in 2016.

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Cost of Goods Sold

Cost of goods sold consists primarily of direct costs of acquiring inventory, including cost of merchandise, inbound freight charges, purchasing costs, and inspection costs for our Uniforms and Related Products and Promotional Products segments. Cost of goods sold for our Remote Staffing Solutions segment includes salaries and payroll related benefits for agents. The Company includes shipping and handling fees billed to customers in net sales. Shipping and handling costs associated with out-bound freight are generally recorded in cost of goods sold. Other shipping and handling costs are included in selling and administrative expenses.

As a percentage of net sales, cost of goods sold for our Uniforms and Related Products segment was 66.7% in 2016 and 67.1% in 2015. The decrease as a percentage of net sales is primarily attributed to a decrease in direct product costs as a percentage of net sales during 2016.

As a percentage of net sales, cost of goods sold for our Remote Staffing Solutions segment was 46.4% in 2016, and 45.0% in 2015. The percentage increase in 2016 as compared to 2015 is primarily attributed to an increase in the percentage of segment revenue coming from the domestic portion of our Remote Staffing Solutions segment from 23.7% in 2015 to 29.1% in 2016. The hourly rates charged for domestic services are higher than offshore services but the margin percentage earned is lower.

Cost of goods sold for our Promotional Products segment was 65.2% of net sales in 2016.

Selling and Administrative Expenses

As a percentage of net sales, selling and administrative expenses for our Uniforms and Related Products segment approximated 24.8% in 2016 and 2015. Favorable factors included higher net sales in 2016 to cover operating expenses (contributing 1.5%) and a claim settlement (contributing 0.2%). These decreases were offset by increased salaries, wages and benefits exclusive of retirement plan expenses and medical costs as a result of the continuing growth in net sales (contributing 0.9%) as well as higher ongoing pension and retirement plan expense primarily as a result of lower discount rates in 2016 as compared to 2015 (contributing 0.2%), higher medical costs in the Company’s self-insured medical plan (contributing 0.3%) and other minor increases (contributing 0.3%).

As a percentage of net sales, selling and administrative expenses for our Remote Staffing Solutions segment approximated 34.0% in 2016 and 33.2% in 2015. The increase as a percentage of net sales is attributed primarily to an increase in wages and benefits to support continuing growth (contributing 2.3%) along with higher facilities costs and depreciation due to our expanded facility in El Salvador (contributing 1.4%) which was partially offset primarily by higher net sales to cover operating expenses.

Promotional Products selling and administrative expenses were $10.4 million, from the acquisition date of March 1, 2016 through December 31, 2016. Included within these expenses was approximately $1.1 million, of expenses associated with the acquisition. Net of these acquisition related expenses, selling and administrative expenses would have been 33.3% of net sales.

Interest Expense and Tax

Interest expense increased to $0.7 million for the year ended December 31, 2016 from $0.5 million for the year ended December 31, 2015. This increase is attributed primarily to higher average borrowings outstanding primarily due to the BAMKO acquisition.

The effective income tax rate in 2016 was 26.4% and in 2015 was 30.9%.  The 4.5% decrease in the effective tax rate is attributed primarily to the early adoption of ASU 2016-09 (4.4%) (See Note 1(y) to the Consolidated Financial Statements), an increase in the benefit related to federal tax credits (0.8%) and other items (0.2%) which was partially offset by a decrease in the benefit of foreign source income (0.9%).

Liquidity and Capital Resources

Overview

The Company uses a number of standards for its own purposes in measuring its liquidity, such as: working capital, profitability ratios, long-term debt as a percentage of long-term debt and equity, and activity ratios. The Company’s balance sheet is very strong at this point and provides the ability to pursue acquisitions, to invest in new product lines and technologies, and to invest in additional working capital as necessary. As of December 31, 2017, approximately $5.8 million of our cash is held in our foreign subsidiaries. As a result of the Tax Act, the Company no longer intends to permanently reinvest its historical foreign earnings and plans to repatriate the funds as needed for liquidity.

The Company’s primary source of liquidity has been its net income and the use of credit facilities and term loans as described further below.  In the future, the Company may continue to use credit facilities and other secured and unsecured borrowings as a source of liquidity.  The Company may also begin relying on the issuance of equity or debt securities.  There can be no assurance that any such financings would be available to us on reasonable terms.  Any future issuances of equity securities or debt securities with equity features may be dilutive to our shareholders.  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.

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Balance Sheet

Accounts receivable-trade increased 20.9% from $41.8 million on December 31, 2016 to $50.6 million December 31, 2017. Approximately $6.5 million of this increase is attributed to acquisitions in our Promotional Products Segment. The balance of the increase is attributed primarily to higher revenues in the fourth quarter 2017 compared to 2016, partially offset by improved collection efforts.

Prepaid expenses and other current assets increased 52.6% from $7.2 million on December 31, 2016 to $11.1 million as of December 31, 2017. Approximately $3.4 million of this increase is attributed to higher prepaid income taxes.

Inventories decreased 6.2% from $69.2 million on December 31, 2016 to $64.5 million as of December 31, 2017.  The decrease is primarily due to sales of remaining inventory to a customer which will not be replenished.

Other intangible assets increased 25.1% from $23.2 million on December 31, 2016 to $29.1 million on December 31, 2017.  This increase is attributed to other intangible assets acquired as part of the two acquisitions in 2017 of $8.2 million partially offset by scheduled amortization.

Goodwill increased 42.3% from $11.3 million on December 31, 2016 to $16.0 million on December 31, 2017.  This increase is attributed to goodwill acquired as part of the two acquisitions in 2017.

Net deferred income tax assets decreased 57.4% from $6.8 million on December 31, 2016 to $2.9 million on December 31, 2017.  This decrease is primarily attributed to the one-time tax re-measurement from the Tax Cut and Jobs Act in addition to the significant contributions to the Company’s pension plans in order to take advantage of the higher tax rate deductions in 2017.

Other assets increased 152.4% from $3.0 million on December 31, 2016 to $7.6 million on December 31, 2017.  The increase is primarily due to higher investments in our Non-Qualified Deferred Compensation plan due to higher employee contributions to the plan. In addition, due to the significant contributions to the Company’s defined pension plans, as well as the higher returns on the plan’s investments in 2017, the fair value of the noncontributory qualified defined benefit pension plan assets exceeded the projected benefit obligations by $2.2 million in 2017.

Accounts payable increased 46.2% from $13.5 million on December 31, 2016 to $19.8 million on December 31, 2017.  This increase is primarily due to the timing of inventory purchases and $3.1million in accounts payable due to the two acquisitions in 2017.

Cash Flows

Cash and cash equivalents increased by $4.5 million from $3.6 million on December 31, 2016 to $8.1 million as of December 31, 2017. During the year ended December 31, 2017, the Company generated cash of $22.7 million in operating activities, used cash of $9.4 million in investing activities, (including $2.9 million of proceeds from the sale of our building in El Salvador, more than offset by $4.2 million used for additions to property, plant and equipment) and $8.0 million for the two acquisitions in our Promotional Products Segment) and used $8.9 million in financing activities.

In 2016, cash and cash equivalents increased by approximately $2.6 million.  Cash provided by operating activities was $12.0 million, cash used in investing activities was $22.5 million (including $7.3 million used for additions to property, plant and equipment and $15.2 million for the acquisition of BAMKO) and $13.1 million was provided in financing activities

Capital Expenditures

In the foreseeable future, the Company expects to continue its ongoing capital expenditure program designed to maintain and improve its facilities. As noted in prior periods, we have invested in a new call center building in El Salvador which was completed in June 2016 and that almost tripled our prior capacity. We spent approximately $6.8 million on the El Salvador project through December 31, 2015 and approximately $3.6 million in the twelve-month period ended December 31, 2016. The Company at all times evaluates its capital expenditure program in light of prevailing economic conditions.

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Dividends and Share Repurchase Program

During the years ended December 31, 2017, 2016 and 2015, respectively, the Company paid cash dividends of $5.3 million, $4.7 million and $4.3 million.  The Company reacquired 45,100 shares of its common stock at a total cost of $0.7 million in the year ended December 31, 2016, pursuant to its stock repurchase program.  No stock was reacquired in the years ended December 31, 2017 and 2015.

On August 1, 2008, the Company’s Board of Directors approved an increase to the outstanding authorization under its common stock repurchase program to allow for the repurchase of 1,000,000 additional shares of the Company’s outstanding shares of common stock. At December 31, 2017, the Company had 216,575 shares remaining for purchase under its common stock repurchase program. Shares purchased under the common stock repurchase program are constructively retired and returned to unissued status. We consider several factors in determining when to make share repurchases, including among other things, our cost of equity, our after-tax cost of borrowing, our debt to total capitalization targets and our expected future cash needs. There is no expiration date or other restriction governing the period over which we can make our share repurchases under the program. The Company anticipates that it will continue to pay dividends and that it will repurchase additional shares of its common stock in the future as financial conditions permit.

Credit Agreement

Effective July 1, 2013, the Company entered into an amended and restated 5-year credit agreement with Fifth Third Bank that made available to the Company up to $15.0 million on a revolving credit basis (the “Initial Credit Facility”) in addition to a $30.0 million term loan utilized to finance the acquisition of substantially all of the assets of HPI Direct, Inc.

Effective March 8, 2016, the Company entered into an amended and restated 5-year credit agreement with Fifth Third Bank (the “Amended Credit Agreement”) that increased its revolving credit facility from $15.0 million to $20.0 million (the “Amended Credit Facility”) and refinanced its then-existing term loan with a new $45.0 million term loan to help finance the acquisition of substantially all of the assets of BAMKO, Inc. Both loans were based upon the one-month LIBOR rate for U.S. dollar based borrowings. Interest was payable on the term loan at LIBOR plus 0.85% and on the revolving credit facility at LIBOR (rounded up to the next 1/8^th of 1%) plus 0.85%. The Company paid a commitment fee of 0.10% per annum on the average unused portion of the commitment under the Amended Credit Facility. This credit agreement was paid in full on February 28, 2017 with the proceeds from a new loan agreement with Branch Banking and Trust Company (“BB&T”).

Effective February 28, 2017, the Company entered into a new 7-year credit agreement with BB&T (the “Credit Agreement”) that provides a new revolving credit facility of $35.0 million (the “Credit Facility”) which terminates on February 25, 2022 and provides a new term loan of $42.0 million (the “Term Loan”) which matures on February 26, 2024. Both loans are based upon the one-month LIBOR rate for U.S. dollar based borrowings. Interest is payable for each loan at LIBOR (rounded up to the next 1/100^th of 1%) plus 0.75% (2.25% at December 31, 2017). The Company pays a commitment fee of 0.10% per annum on the average unused portion of the commitment under the Credit Facility. The available balance under the Credit Facility is reduced by outstanding letters of credit. As of December 31, 2017, there is $1.5 million due under the Credit Facility and no outstanding letters of credit.

The remaining scheduled amortization for the term loan is as follows: 2018 through 2023 $6.0 million per year; 2024 $1.5 million. The term loan does not include a prepayment penalty. In connection with the Amended Credit Agreement, the Company incurred approximately $0.1 million of debt issuance costs, which primarily consisted of legal fees. These costs are being amortized over the life of the Amended Credit Agreement and are recorded as additional interest expense.

The Company’s obligations under the Amended Credit Agreement are secured by substantially all of the operating assets of Superior Uniform Group, Inc. and are guaranteed by all domestic subsidiaries of Superior Uniform Group, Inc. The agreement contains restrictive provisions concerning a maximum funded senior indebtedness to EBITDA ratio as defined in the agreement (4.0:1) as defined in the agreement and a fixed charge coverage ratio (1.25:1). The Company is in full compliance with all terms, conditions and covenants of the Amended Credit Agreement.

Interest Rate Swap Agreement

In order to reduce interest rate risk on its debt, the Company entered into an interest rate swap agreement with Fifth Third Bank, N.A. in July 2013 that was designed to effectively convert or hedge the variable interest rate on a portion of its borrowings to achieve a net fixed rate of 2.53% per annum, beginning July 1, 2014 with a notional amount of $14.3 million. The notional amount of the interest rate swap is reduced by the scheduled amortization of the principal balance of the original term loan of $0.2 million per month through July 1, 2015 and $0.3 million per month through June 1, 2018 with the remaining notional balance of $3.3 million to be eliminated on July 1, 2018.  Effective at the inception of the new term loan, the fixed rate on the notional amount was reduced to 2.43%.  Effective February 24, 2017, this interest rate swap agreement was terminated. On this date the swap agreement had $0.1 million in cumulative gains in OCI which was reversed to earnings.

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Effective March 3, 2017, in order to reduce the interest rate risk on its future debt, the Company entered into an interest rate swap agreement with BB&T that was designed to effectively convert or hedge the variable interest rate on a portion of its future borrowings to achieve a net fixed rate of 3.12% per annum, beginning March 1, 2018 with a notional amount of $18.0 million.  The notional amount of the interest rate swap is reduced by $0.3 million per month beginning April 1, 2018 through February 26, 2024.  Under the terms of the interest rate swap, the Company will receive variable interest rate payments and make fixed interest rate payments on an amount equal to the notional amount at that time.  Changes in the fair value of the interest rate swap designated as the hedging instrument that effectively offset the variability of cash flows associated with the variable rate, long-term debt obligation are recorded in OCI, net of related income tax effects.  As of December 31, 2017, the swap agreement had a negative fair value of $0.1 million which is presented within other current liabilities on the consolidated balance sheet. 

Long-Term Contractual Obligations

The following table sets forth a summary of our material contractual obligations as of December 31, 2017:

(In thousands)	Payments Due by Period
	2018		2019-2020		2021-2022		After 2022
Long-term debt (1)	$	6,000	$	12,000	$	12,000	$	7,500
Note payable - revolving credit agreement (1)		-		-		-		1,475
Operating leases (2)		909		1,150		33		-
Acquisition-related liability (3)		200		240		-		-
Acquisition-related contingent liability (3)		3,078		4,614		2,836		-
Total long term contractual cash obligations	$	10,187	$	18,004	$	14,869	$	8,975

(1) Excludes estimates for interest payable as amounts are based on variable rates. See Note 6.

(2) Amounts do not include certain operating expenses such as maintenance, insurance, and real estate taxes.

(3) The amounts represent the expected cash payment. The amounts on our consolidated balance sheet are stated at fair value.

(4) Certain long-term liabilities have been excluded from this table as we cannot make a reasonable estimate of the period of cash settlement. These long-term liabilities include unrecognized tax benefits of $0.5 million, pension liability of $6.2 million and deferred compensation liability of $2.1 million. We expect to contribute $0.1 million to our pension plan in 2018.

Off-Balance Sheet Arrangements

The Company does not engage in any off-balance sheet financing arrangements. In particular, we do not have any interest in variable interest entities, which include special purpose entities and structured finance entities.

Critical Accounting Policies

Our significant accounting policies are described in Note 1 to the consolidated financial statements included in this Form 10-K. Our discussion and analysis of financial condition and results of operations are based upon our consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of the financial statements requires us to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues, expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, we evaluate the estimates that we have made. These estimates are based upon our historical experience and on various other assumptions that we believe to be reasonable under the circumstances. Our actual results may differ from these estimates under different assumptions or conditions.

Our critical accounting estimates require our most difficult or subjective judgments or estimates about the effect of matters that are inherently uncertain. A discussion of our critical accounting estimates, the underlying judgments and uncertainties used to make them and the likelihood that materially different estimates would be reported under different conditions or using different assumptions is as follows:

Allowance for Losses on Accounts Receivable

Judgments and estimates are used in determining the collectability of accounts receivable. The Company analyzes specific accounts receivable and historical bad debt experience, customer credit worthiness, current economic trends and the age of outstanding balances when evaluating the adequacy of the allowance for doubtful accounts. Management judgments and estimates are used in connection with establishing the allowance in any accounting period. Changes in estimates are reflected in the period they become known. If the financial condition of the Company’s customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required. An additional impairment in value of one percent of net accounts receivable would require an increase in the allowance for doubtful accounts and would result in additional expense of approximately $0.5 million. The Company’s concentration of risk is also monitored and at year-end 2017, no customer(s) had an account balance greater than 11.3% of receivables and the five largest customer account balances totaled $14.2 million. Additionally, the Company advances funds for certain of its suppliers to purchase raw materials. The Company deducts payment for these raw materials from payments made to the suppliers upon completion of the related finished goods. The Company had a receivables balance from one of its suppliers located in Haiti totaling approximately $1.5 million at December 31, 2017. This amount is included in accounts receivable-other on the consolidated balance sheet.

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Inventories

Superior’s Uniforms and Related Products segment markets itself to its customers as a "stock house." Therefore, Superior at all times carries substantial inventories of raw materials (principally piece goods) and finished garments. Inventories are stated at the lower of cost or market value. Judgments and estimates are used in determining the likelihood that new goods on hand can be sold to customers. Historical inventory usage and current revenue trends are considered in estimating both excess and obsolete inventories. If actual product demand and market conditions are less favorable than those projected by management, additional inventory write-downs may be required, which may be material.

Goodwill

Goodwill represents the excess of the cost of an acquisition over the fair value of the net assets acquired. The Company tests goodwill for impairment annually as of December 31st and/or when an event occurs or circumstances change such that it is more likely than not that impairment may exist. Examples of such events and circumstances that the Company would consider include the following:

• macroeconomic conditions such as deterioration in general economic conditions, limitations on accessing capital, or other developments in equity and credit markets;

• industry and market considerations such as a deterioration in the environment in which the Company operates, an increased competitive environment, a decline in market-dependent multiples or metrics (considered in both absolute terms and relative to peers), a change in the market for the Company's products or services, or a regulatory or political development;

• cost factors such as increases in raw materials, labor, or other costs that have a negative effect on earnings and cash flows;

• overall financial performance such as negative or declining cash flows or a decline in actual or planned revenue or earnings compared with actual and projected results of relevant prior periods;

• other relevant entity-specific events such as changes in management, key personnel, strategy, or customers. 

Goodwill is tested at a level of reporting referred to as "the reporting unit." The Company's reporting units are defined as each of its three reporting segments with its goodwill included in the Uniforms and Related Products segment of $4.1 million and $11.9 million in the Promotional Products segment.

An entity has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not (that is, a likelihood of more than 50%) that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, an entity determines it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the impairment test is unnecessary. The Company completed its assessment of the qualitative factors as of December 31, 2017 and determined that it was not more likely than not that the fair value of the reporting unit was less than its carrying value.

Insurance

The Company self-insures for certain obligations related to health insurance programs. The Company also purchases stop-loss insurance policies to protect it from catastrophic losses. Judgments and estimates are used in determining the potential value associated with reported claims and for losses that have occurred, but have not been reported. The Company's estimates consider historical claim experience and other factors. The Company's liabilities are based on estimates, and, while the Company believes that the accrual for loss is adequate, the ultimate liability may be in excess of or less than the amounts recorded. Changes in claim experience, the Company's ability to settle claims or other estimates and judgments used by management could have a material impact on the amount and timing of expense for any period.

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Pensions

The Company is the sponsor of two noncontributory qualified defined benefit pension plans, providing for normal retirement at age 65, covering all eligible employees (as defined). Periodic benefit payments on retirement are determined based on a fixed amount applied to service or determined as a percentage of earnings prior to retirement. The Company is also the sponsor of an unfunded supplemental executive retirement plan (SERP) in which several of its employees are participants. Pension plan assets for retirement benefits consist primarily of fixed income securities and common stock equities. Effective June 30, 2013, the Company no longer accrues additional benefits for future service or for future increases in compensation levels for the company’s primary defined benefit pension plans. 

The Company’s pension obligations are determined using estimates including those related to discount rates and asset values. The discount rates used for the Company’s pension plans of 3.91% to 4.04% were determined based on the Citigroup Pension Yield Curve.  This rate was selected as the best estimate of the rate at which the benefit obligations could be effectively settled on the measurement date taking into account the nature and duration of the benefit obligations of the plan using high-quality fixed-income investments currently available (rated AA or better) and expected to be available during the period to maturity of the benefits. The 8% expected return on plan assets was determined based on historical long-term investment returns as well as future expectations given target investment asset allocations and current economic conditions.

At December 31, 2017, the Company’s projected benefit obligation under its supplemental executive retirement pension plan exceeded the fair value of the plan assets by $8.4 million and thus the plan is underfunded. The fair value of the plans assets for the noncontributory qualified defined benefit pension plans exceeded their projected benefit obligations by $2.2 million and thus the plans are overfunded. In 2017, a reduction in the expected return on plan assets of 0.25% would have resulted in additional expense of approximately $0.1 million, while a reduction in the discount rate of 0.25% would have resulted in additional expense of approximately $0.1 million and would have reduced the funded status by $1.1 million for the Company’s defined benefit pension plans. Interest rates and pension plan valuations may vary significantly based on worldwide economic conditions and asset investment decisions. For additional information on our benefit plans, please refer to “Note 8 – Benefit Plans” in the notes to the consolidated financial statements included in this Form 10-K.

Income Taxes

The Company is required to estimate and record income taxes payable for federal, state and foreign jurisdictions in which the Company operates. This process involves estimating actual current tax expense and assessing temporary differences resulting from differing accounting treatment between tax and book that result in deferred tax assets and liabilities. In addition, accruals are also estimated for federal and state tax matters for which deductibility is subject to interpretation. Taxes payable and the related deferred tax differences may be impacted by changes to tax laws, changes in tax rates and changes in taxable profits and losses. The Tax Act was enacted on December 22, 2017, and has several key provisions impacting accounting for and reporting of income taxes. The most significant provision reduces the U.S. corporate statutory tax rate from 34% to 21% beginning on January 1, 2018. Although most provisions of tax reform are not effective until 2018, we are required to record the effect of a change in tax law in the period of enactment (2017). The provision for income taxes and effective tax rate in 2017 included a $4.0 million unfavorable impact from the change in tax law. The impact is due primarily to the remeasurement of our U.S. federal deferred tax assets and liabilities at the tax rate expected to apply when the temporary differences are realized/settled (remeasured at a rate of 21% versus 34% for the majority of our deferred tax assets and liabilities). The other key provision that requires recognition in the period of enactment is the one-time toll charge resulting from the mandatory deemed repatriation of undistributed foreign taxable income. In addition, the Company no longer intends to permanently reinvest its historical foreign earnings and has recorded and additional deferred tax expense.

Reserves are also estimated for uncertain tax positions that are currently unresolved. The Company routinely monitors the potential impact of such situations and believes that it is properly reserved. For the year ending December 31, 2017, there was no change in total unrecognized tax benefits. As of December 31, 2017, we had an accrued liability of $0.5 million for unrecognized tax benefits. We accrue interest and penalties related to unrecognized tax benefits in income tax expense, and the related liability is included in other long-term liabilities on the accompanying consolidated balance sheet.

The Company elected to early adopt ASU 2016-09 “Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”. The amendment requires that excess tax benefits for share-based payments be recorded as a reduction of income tax expense. The recognition of excess tax benefits in our provision for income taxes rather than paid-in-capital resulted in an income tax benefit of $1.8 million for the year ended December 31, 2017. For additional information please refer to “Note 1(y) – Recent Accounting Pronouncements” in the notes to the consolidated financial statements included in this Form 10-K.

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Share-Based Compensation

The Company recognizes expense for all share-based payments to employees, including grants of employee stock options, in the financial statements based on their fair values. Share-based compensation expense that was recorded in 2017, 2016 and 2015 includes the compensation expense for the share-based payments granted in those years. In the Company’s share-based compensation strategy we utilize a combination of stock options and stock appreciation rights (“SARS”) that fully vest on the date of grant and restricted shares and performance shares of common stock that vest over time or if performance targets are met. The fair value of the options and SARS granted is recognized as expense on the date of grant. The Company used the Black-Scholes-Merton valuation model to value any share-based compensation. Option valuation methods, including Black-Scholes-Merton, require the input of highly complex and subjective assumptions including the risk free interest rate, dividend rate, expected term and common stock price volatility rate. The Company determines the assumptions to be used based upon current economic conditions. While different assumptions may result in materially different stock compensation expenses, changing any one of the individual assumptions by 10% would not have a material impact on the recorded expense. Expense for unvested shares of restricted stock and performance shares is recognized over the required service period. For additional information on share-based compensation and the assumptions we use, please refer to “Note 12 – Share Based Compensation” in the notes to the consolidated financial statements included in this Form 10-K.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

Interest Rate Risk

We are subject to market risk exposure related to changes in interest rates on our debt. Interest on our term loan and revolving credit facility are based upon the one-month LIBOR rate. In order to reduce the interest rate risk on our debt, the Company entered into an interest rate swap agreement on a portion of its borrowings. A hypothetical increase in the LIBOR rate of 100 basis points as of January 1, 2017 would have resulted in approximately $0.4 million in additional pre-tax interest expense for the year ended December 31, 2017. See Note 6 to our consolidated financial statements.

Foreign Currency Exchange Risk

Sales to clients outside of the United States are subject to fluctuations in foreign currency exchange rates.  Approximately 1% of our sales are outside of the United States. As the prices at which we sell our products are not routinely adjusted for exchange rate changes, the gross profit on our orders may be negatively affected.  We cannot predict the effect of exchange rate fluctuations on our operating results.  In certain cases, we may enter into foreign currency cash flow hedges to reduce the variability of cash flows associated with our sales and expenses denominated in foreign currency.  As of December 31, 2017, we were not engaged in foreign currency exchange hedging transactions; however, if and when we do, there can be no assurance that our strategies will adequately protect our operating results from the effect of exchange rate fluctuations.

Our foreign subsidiaries in the Promotional Products segment are denominated in their local currencies which include the Hong Kong dollar, the Chinese renminbi, the British pound, the India rupee, and the Brazilian real. Changes in exchange rates for intercompany payables and receivables not considered to be long-term are reported as transaction gains (losses) in our consolidated statements of comprehensive income. During the year end December 31, 2017, transaction losses were approximately $0.1 million on a pre-tax basis.

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Item 8. Financial Statements and Supplementary Data

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders

Superior Uniform Group, Inc. and Subsidiaries:

Opinions on the Financial Statements and Internal Control over Financial Reporting

We have audited the accompanying consolidated balance sheets of Superior Uniform Group, Inc. and Subsidiaries (the “Company”) as of December 31, 2017 and 2016, and the related consolidated statements of comprehensive income, shareholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2017, and the related notes (collectively referred to as the “consolidated financial statements”). We also have audited the Company’s internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2017 and 2016, and the results of its operations and its cash flows for each of the years in the three-year period ended December 31, 2017, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2017, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO.

Basis for Opinion

The Company’s management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s consolidated financial statements and an opinion on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects.

Our audits of the consolidated financial statements included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. As described in Management’s Report on Internal Control over Financial Reporting, management excluded from its evaluation of, and conclusion on, the effectiveness of the Company’s internal control over financial reporting as of December 31, 2017, both PublicIdentity and Tangerine Promotions’ internal control over financial reporting associated with total assets of $3,233,000 and $16,434,000, respectively, and total revenues of $1,777,000 and $2,659,000, respectively, included in the Company’s consolidated financial statements as of and for the year ended December 31, 2017. Based on this evaluation, management concluded that the Company’s internal control over financial reporting was effective as of December 31, 2017. Accordingly, our audit also excluded an evaluation of both PublicIdentity and Tangerine Promotions’ internal control over financial reporting. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

Definition and Limitations of Internal Control over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of consolidated financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the consolidated financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Mayer Hoffman McCann P.C.

We have served as the Company’s auditor since 2013.

February 22, 2018

Clearwater, Florida

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SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

YEARS ENDED DECEMBER 31,

(In thousands, except shares and per share data)

	2017			2016			2015
Net sales	$	266,814		$	252,596		$	210,317
Costs and expenses:
Cost of goods sold		170,462			165,614			138,884
Selling and administrative expenses		71,816			66,396			52,018
Interest expense		802			688			519
		243,080			232,698			191,421
Gain on sale of property, plant and equipment		1,048			-			-
Income before taxes on income		24,782			19,898			18,896
Income tax expense		9,760			5,260			5,830
Net income	$	15,022		$	14,638		$	13,066
Weighted average number of shares outstanding during the period
(Basic)		14,510,156			14,082,243			13,761,009
(Diluted)		15,118,768			14,897,489			14,578,644
Per Share Data:
Basic
Net earnings	$	1.04		$	1.04		$	0.95
Diluted
Net earnings	$	0.99		$	0.98		$	0.90
Other comprehensive income (loss), net of tax:
Defined benefit pension plans:
Recognition of net losses included in net periodic pension costs		652			667			499
Recognition of settlement loss included in net periodic pension costs		272			287			297
Current period loss		(1,948	)		(764	)		(1,410	)
(Loss) gain on cash flow hedging activities		(111	)		95			37
Foreign Currency Translation Adjustment:
Reclassification of gain on foreign currency transactions included in net income		-			(170	)		-
Foreign currency translation adjustments		20			243			-
Other comprehensive (loss) income	$	(1,115	)	$	358		$	(577	)
Comprehensive income	$	13,907		$	14,996		$	12,489
Cash dividends per common share	$	0.365		$	0.340		$	0.315

See accompanying notes to consolidated financial statements.

28

SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

YEARS ENDED DECEMBER 31,

(In thousands, except share and par value data)

	2017			2016
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	8,130		$	3,649
Accounts receivable, less allowance for doubtful accounts of $1,382 and $1,276, respectively		50,569			41,823
Accounts receivable - other		1,848			3,085
Inventories		64,979			69,240
Prepaid expenses and other current assets		11,011			7,214
TOTAL CURRENT ASSETS		136,537			125,011
PROPERTY, PLANT AND EQUIPMENT, NET		26,844			27,533
OTHER INTANGIBLE ASSETS, NET		29,061			23,238
GOODWILL		16,032			11,269
DEFERRED INCOME TAXES		2,900			6,800
OTHER ASSETS		7,564			2,997
	$	218,938		$	196,848
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable	$	19,752		$	13,507
Other current liabilities		12,409			10,716
Current portion of long-term debt		6,000			5,893
Current portion of acquisition-related contigent liability		3,061			1,788
TOTAL CURRENT LIABILITIES		41,222			31,904
LONG-TERM DEBT		32,933			36,227
LONG-TERM PENSION LIABILITY		8,319			9,467
LONG-TERM ACQUISITION-RELATED CONTINGENT LIABILITY		7,283			7,238
OTHER LONG-TERM LIABILITIES		4,213			1,462
COMMITMENTS AND CONTINGENCIES (NOTE 11)
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 - 15,081,947 and 14,513,207, respectively.		15			15
Additional paid-in capital		49,103			42,416
Retained earnings		83,129			74,283
Accumulated other comprehensive income (loss), net of tax:
Pensions		(7,282	)		(6,258	)
Cash flow hedges		(90	)		21
Foreign Currency Translation Adjustment		93			73
TOTAL SHAREHOLDERS' EQUITY		124,968			110,550
	$	218,938		$	196,848

See accompanying notes to consolidated financial statements.

29

SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

YEARS ENDED DECEMBER 31,

(In thousands, except shares and per share data)

												Accumulated
												Other
						Additional						Comprehensive			Total
	Common			Common		Paid-In			Retained			(Loss) Income,			Shareholders’
	Shares			Stock		Capital			Earnings			net of tax			Equity
Balance, January 1, 2015		13,514,566		$	13	$	29,501		$	56,843		$	(5,945	)	$	80,412
Common shares issued upon exercise of options, net		294,659			1		2,101			(262	)					1,840
Restricted shares issued		8,326					282									282
Common shares issued upon exercise of Stock Appreciation Rights (SARs)		99,914					-									-
Share-based compensation expense							1,079									1,079
Excess tax benefit from exercies of stock options							618									618
Excess tax benefit from exercise of SARS, net							225									225
Cash dividends declared ($.0315 per share)										(4,255	)					(4,255	)
Comprehensive Income (Loss):
Net earnings										13,066						13,066
Net change during the period related to:
Cash flow hedges, net of taxes of $20													37			37
Pensions, net of taxes of $339													(614	)		(614	)
Comprehensive Income:																12,489
Balance, December 31, 2015		13,917,465			14		33,806			65,392			(6,522	)		92,690
Common shares issued upon exercise of options, net		251,996			1		1,960			(457	)					1,504
Restricted shares issued		333,190					4,558									4,558
Common shares issued upon exercise of Stock Appreciation Rights (SARs)		55,656														-
Share-based compensation expense							1,638									1,638
Tax withheld on exercise of Stock Appreciation Rights (SARs)							(405	)								(405	)
Tax benefit from vesting of acquisition related restricted stock							990									990
Purchase and retirement of common shares		(45,100	)				(131	)		(583	)					(714	)
Cash dividends declared ($.034 per share)										(4,707	)					(4,707	)
Comprehensive Income (Loss):
Net earnings										14,638						14,638
Net change during the period related to:
Cash flow hedges, net of taxes of $24													95			95
Pensions, net of taxes of $97													190			190
Change in currency translation adjustment, net of taxes of $41													73			73
Comprehensive Income:																14,996
Balance, December 31, 2016		14,513,207			15		42,416			74,283			(6,164	)		110,550

30

SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY

YEARS ENDED DECEMBER 31,

(In thousands, except shares and per share data)

											Accumulated
											Other
					Additional						Comprehensive			Total
	Common		Common		Paid-In			Retained			(Loss) Income,			Shareholders’
	Shares		Stock		Capital			Earnings			net of tax			Equity
Balance, December 31, 2016		14,513,207		15		42,416			74,283			(6,164	)		110,550
Common shares issued upon exercise of options		285,745				2,779			(907	)					1,872
Restricted shares issued		181,399				2,780									2,780
Common shares issued upon exercise of Stock Appreciation Rights (SARs)		101,596													-
Share-based compensation expense						1,664									1,664
Tax withheld on exercise of Stock Appreciation Rights (SARS)						(1,186	)								(1,186	)
Tax benefit from vesting of acquisition related restricted stock						650									650
Cash dividends declared ($ 0.365 per share)									(5,269	)					(5,269	)
Comprehensive Income (Loss):
Net earnings									15,022						15,022
Net change during the period related to:
Cash flow hedges, net of taxes of $36												(111	)		(111	)
Pensions, net of taxes of $59												(1,024	)		(1,024	)
Change in currency translation adjustment, net of taxes of $13												20			20
Comprehensive Income:															13,907
Balance, December 31, 2017		15,081,947	$	15	$	49,103		$	83,129		$	(7,279	)	$	124,968

See Notes to Consolidated Financial Statements.

31

SUPERIOR UNIFORM GROUP, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31,

(In thousands)

	2017			2016			2015
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	15,022		$	14,638		$	13,066
Adjustments to reconcile net income to net cash provided from operating activities:
Depreciation and amortization		5,653			4,935			3,873
Provision for bad debts - accounts receivable		1,002			512			266
Share-based compensation expense		1,664			1,638			1,361
Deferred income tax provision (benefit)		5,114			(1,940	)		(1,216	)
Gain on foreign currency transactions		-			(264	)		-
Gain on disposals of property, plant and equipment		(1,048	)		-			(1	)
Adjustment to acquisition-related contingent liability		(250	)		(200	)		(200	)
Accretion of acquisition-related contingent liability		161			169			119
Excess tax benefit from exercise of stock options and SARS		-			-			1,575
Changes in assets and liabilities, net of acquisition of businesses:
Accounts receivable - trade		(4,731	)		(7,244	)		(2,224	)
Accounts receivable - other		1,237			177			873
Inventories		4,250			(5,427	)		(5,291	)
Prepaid expenses and other current assets		(4,151	)		2,203			(1,717	)
Other assets		(4,504	)		(1,029	)		(1,817	)
Accounts payable		3,291			87			2,069
Other current liabilities		71			1,943			(631	)
Long-term pension liability		(2,577	)		829			(112	)
Other long-term liabilities		2,523			962			(80	)
Net cash provided from operating activities		22,727			11,989			9,913
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property, plant and equipment		(4,248	)		(7,385	)		(8,069	)
Proceeds from disposals of property, plant and equipment		2,858			-			24
Acquisition of businesses, net of acquired cash		(7,988	)		(15,161	)		-
Net cash used in investing activities		(9,378	)		(22,546	)		(8,045	)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long-term debt		74,387			125,067			67,345
Repayment of long-term debt		(77,573	)		(106,827	)		(68,416	)
Payment of cash dividends		(5,269	)		(4,707	)		(4,255	)
Payment of acquisition-related contingent liability		(1,800	)		(1,800	)		(1,200	)
Proceeds received on exercise of stock options		1,872			1,504			1,840
Tax benefit from vesting of acquisition related restricted stock		650			990			-
Tax withholdings on exercise of stock rights		(1,186	)		(405	)		(732	)
Common stock reqcquired and retired		-			(714	)		-
Net cash (used in) provided from financing activities		(8,919	)		13,108			(5,418	)
Effect of exchange rates on cash		51			62			-
Net increase (decrease) in cash and cash equivalents		4,481			2,613			(3,550	)
Cash and cash equivalents balance, beginning of year		3,649			1,036			4,586
Cash and cash equivalents balance, end of year	$	8,130		$	3,649		$	1,036

See accompanying notes to consolidated financial statements.

32

Superior Uniform Group, Inc. and Subsidiaries

Notes to Consolidated Financial Statements

NOTE 1 – Summary of Significant Accounting Policies:

a) Business description

Superior’s Uniforms and Related Products segment, through its signature marketing brands Fashion Seal Healthcare^®, HPI Direct^®, Superior I.D.™, Worklon^®, and UniVogue^®, manufactures and sells a wide range of uniforms, corporate identity apparel, career apparel and accessories for the hospital and healthcare fields; hotels; fast food and other restaurants; transportation; and the private security, industrial and commercial markets. In excess of 95% of Superior’s Uniforms and Related Products segment’s net sales are from the sale of uniforms and service apparel and directly-related products.

Superior services its Remote Staffing Solutions segment through multiple The Office Gurus entities, including its direct and indirect subsidiaries in El Salvador, Belize, and the United States, (collectively, “TOG”). TOG is a near-shore premium provider of cost effective multilingual telemarketing and total office support solutions.

The Promotional Products segment, through the BAMKO, Public Identity and Tangerine brands, services customers that purchase primarily promotional and related products. The segment currently has sales offices in the United States and Brazil with support services in China, Hong Kong and India.

b) Basis of presentation

The consolidated financial statements include the accounts of Superior Uniform Group, Inc. and its wholly-owned subsidiaries, The Office Gurus, LLC, SUG Holding, Fashion Seal Corporation, and BAMKO, LLC; The Office Gurus, Ltda, de C.V., The Office Masters, Ltda., de C.V. and The Office Gurus, Ltd., each a subsidiary of Fashion Seal Corporation and SUG Holding; and Power Three Web, Ltda. and Superior Sourcing, each a wholly-owned subsidiary of SUG Holding; BAMKO Importação, Exportação e Comércio de Brindes Ltda., a subsidiary of BAMKO, LLC and SUG Holding; Guangzhou Ben Gao Trading Limited, Worldwide Sourcing Solutions Limited, and BAMKO UK, Limited, each a direct or indirect subsidiary of BAMKO, LLC, and BAMKO India Private Limited, a 99%-owned subsidiary of BAMKO, LLC. All of these entities are referred to collectively as “the Company”. Intercompany items have been eliminated in consolidation.

c) Cash and cash equivalents

The Company considers all highly liquid investments with an original maturity of three months or less at the time of purchase to be cash equivalents.

d) Revenue recognition and allowance for doubtful accounts

The Company recognizes revenue as products are shipped and title passes and as services are provided. The Company collects sales tax for various taxing authorities. It is the Company’s policy to record these amounts on a net basis. Therefore, these amounts are not included in net sales for the Company. A provision for estimated returns and allowances is recorded based upon historical experience and current allowance programs. Judgments and estimates are used in determining the collectability of accounts receivable. The Company analyzes specific accounts receivable and historical bad debt experience, customer credit worthiness, current economic trends and the age of outstanding balances when evaluating the adequacy of the allowance for doubtful accounts. Management judgments and estimates are used in connection with establishing the allowance in any accounting period. Changes in estimates are reflected in the period they become known. Charge-offs of accounts receivable are made once all collection efforts have been exhausted. If the financial condition of the Company's customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances may be required.

e)     Accounts receivable-other

The Company purchases raw materials and has them delivered to certain suppliers of the Company. The Company pays for the raw materials and then deducts the cost of these materials from payments to the suppliers at the time the related finished goods are invoiced to the Company by those suppliers.

f) Advertising expenses

The Company expenses advertising costs as incurred. Advertising costs for each of the years ended December 31, 2017, 2016 and 2015, respectively, were $0.1 million.

33

g) Cost of goods sold and shipping and handling fees and costs  

Cost of goods sold consists primarily of direct costs of acquiring inventory, including cost of merchandise, inbound freight charges, purchasing, receiving and inspection costs, for our Uniforms and Related Products segment and our Promotional Products segment. Cost of goods sold for our Remote Staffing Solutions segment includes salaries and payroll related benefits for agents. The Company includes shipping and handling fees billed to customers in net sales. Shipping and handling costs associated with out-bound freight are generally recorded in cost of goods sold. Other shipping and handling costs are included in selling and administrative expenses and totaled $10.9 million, $10.6 million and $9.3 million for the years ended December 31, 2017, 2016 and 2015, respectively.

h) Inventories

Inventories are stated at the lower of cost (first-in, first-out method) or market value. Judgments and estimates are used in determining the likelihood that goods on hand can be sold to customers. Historical inventory usage and current revenue trends are considered in estimating both excess and obsolete inventories. If actual product demand and market conditions are less favorable than those projected by management, additional inventory write-downs may be required.

i) Property, plant and equipment

Property, plant and equipment are stated at cost, less accumulated depreciation and amortization. Major renewals and improvements are capitalized, while replacements, maintenance and repairs which do not improve or extend the life of the respective assets are expensed on a current basis. Costs of assets sold or retired and the related accumulated depreciation and amortization are eliminated from accounts and the net gain or loss is reflected in the consolidated statements of comprehensive income within selling and administrative expenses.

j) Goodwill

Goodwill represents the excess of the cost of an acquisition over the fair value of the net assets acquired. The Company tests goodwill for impairment annually as of December 31st and/or when an event occurs or circumstances change such that it is more likely than not that impairment may exist. Examples of such events and circumstances that the Company would consider include the following:

• macroeconomic conditions such as deterioration in general economic conditions, limitations on accessing capital, or other developments in equity and credit markets;

• industry and market considerations such as a deterioration in the environment in which the Company operates, an increased competitive environment, a decline in market-dependent multiples or metrics (considered in both absolute terms and relative to peers), a change in the market for the Company's products or services, or a regulatory or political development;

• cost factors such as increases in raw materials, labor, or other costs that have a negative effect on earnings and cash flows;

• overall financial performance such as negative or declining cash flows or a decline in actual or planned revenue or earnings compared with actual and projected results of relevant prior periods;

• other relevant entity-specific events such as changes in management, key personnel, strategy, or customers. 

Goodwill is tested at a level of reporting referred to as "the reporting unit." The Company's reporting units are defined as each of its three reporting segments with its goodwill included in the Uniforms and Related Products segment of $4.1 million and $11.9 million in the Promotional Products segment.

An entity has the option to first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not (that is, a likelihood of more than 50%) that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, an entity determines it is not more likely than not that the fair value of a reporting unit is less than its carrying amount, then performing the impairment test is unnecessary. The Company completed its assessment of the qualitative factors as of December 31, 2017 and determined that it was not more likely than not that the fair value of the reporting unit was less than its carrying value.

34

k) Other intangible assets

Other intangible assets consist of customer relationships, a non-compete agreement and trade names acquired in previous business acquisitions.

The cost, amortization and net value of customer relationships and non-compete agreement as of December 31, 2017 and 2016 were as follows (In thousands):

	Customer Relationships			Weighted Average Life (years)		Non-Compete Agreement			Weighted Average Life (years)		Customer Backlog			Weighted Average Life (years)
December 31, 2017
Cost	$	15,530			8.8	$	5,551			5.1	$	122			0.5
Accumulated amortization		(4,782	)				(4,619	)				(10	)
Net	$	10,748				$	932				$	112
December 31, 2016
Cost	$	12,311			9.4	$	5,370			5.1	$	0			N/A
Accumulated amortization		(4,490	)				(3,553	)				0
Net	$	7,821				$	1,817				$	0

Amortization expense for other intangible assets was $2.4 million, $2.3 million and $2.1 million for the years ended December 31, 2017, 2016 and 2015, respectively.  Amortization expense for other intangible assets is expected to be $2.5 million in 2018; $1.9 million in each of the years ending December 31, 2019 through 2021; $1.8 million in 2022; $1.1 million in 2023 and $0.5 million in 2024.

As part of the acquisition of HPI in 2013, the Company recorded $4.7 million as the fair value of the acquired trade name in other intangible assets. This asset is considered to have an indefinite life and as such is not being amortized.

As part of the acquisition of BAMKO in 2016, the Company recorded $8.9 million as the fair value of the acquired trade name in other intangible assets. This asset is considered to have an indefinite life and as such is not being amortized.

As part of the acquisitions of Public Identity and Tangerine in 2017, the Company recorded $0.5 million and $3.2 million, respectively as the fair value of the acquired trade names in other intangible assets. These amounts are considered to have an indefinite life and as such are not being amortized.

l) Depreciation and amortization

Plant and equipment are depreciated on the straight-line basis at 2.5% to 5% for buildings, 2.5% to 20% for improvements, 10% to 33.33% for machinery, equipment and fixtures and 20% to 33.33% for transportation equipment. Leasehold improvements are amortized over the terms of the leases inasmuch as such improvements have useful lives of at least the terms of the respective leases.

m) Employee benefits

Pension plan costs are funded currently based on actuarial estimates, with prior service costs amortized over 20 years. The Company recognizes settlement gains and losses in its consolidated financial statements when the cost of all settlements in a year is greater than the sum of the service cost and interest cost components of net periodic pension cost for the plan for the year.

n) Insurance

The Company self-insures for certain obligations related to employee health programs. The Company also purchases stop-loss insurance policies to protect it from catastrophic losses. Judgments and estimates are used in determining the potential value associated with reported claims and for losses that have occurred, but have not been reported. The Company's estimates consider historical claim experience and other factors. The Company's liabilities are based on estimates, and, while the Company believes that the accrual for loss is adequate, the ultimate liability may be in excess of or less than the amounts recorded. Changes in claim experience, the Company's ability to settle claims or other estimates and judgments used by management could have a material impact on the amount and timing of expense for any period.

35

o) Taxes on income

Income taxes are provided for under the liability method, whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The calculation of the Company’s tax liabilities also involves dealing with uncertainties in the application of complex tax regulations. The Company recognizes liabilities for uncertain income tax positions based on estimates of whether, and the extent to which, additional taxes will be required. The Company also reports interest and penalties related to uncertain income tax positions as income taxes. Refer to Note 7.

p) Impairment of long-lived assets

Long-lived assets, such as property and equipment, and purchased intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of the asset is measured by comparison of its carrying amount to future net cash flows the asset is expected to generate. If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the asset exceeds its fair value. There was no impairment of long-lived assets for the years ended December 31, 2017, 2016, and 2015.

q) Share-based compensation

The Company awards share-based compensation as an incentive for employees to contribute to the Company’s long-term success. Historically, the Company has granted options, stock-settled stock appreciation rights, and restricted stock. In 2016, the Company began issuing performance shares as well. At December 31, 2017, the Company had 3,667,577 shares of common stock available for grant of awards of share-based compensation under its 2013 Incentive Stock and Awards Plan.

The Company recognizes share-based compensation expense for all awards granted to employees, which is based on the fair value of the award on the date of grant. Determining the appropriate fair value model and calculating the fair value of stock compensation awards requires the input of certain highly complex and subjective assumptions, including the expected life of the stock compensation awards and the Company’s common stock price volatility, risk free interest rate and dividend rate. The assumptions used in calculating the fair value of stock compensation awards represent management’s best estimates, but these estimates involve inherent uncertainties and the application of judgment. As a result, if factors change and the Company deems it necessary to use different assumptions, stock compensation expense could be materially different from what has been recorded in the current period.

r) Earnings per share

Historical basic per share data is based on the weighted average number of shares outstanding. Historical diluted per share data is reconciled by adding to weighted average shares outstanding the dilutive impact of the exercise of outstanding stock options, stock-settled stock appreciation rights, and restricted stock.

s) Comprehensive income

Other comprehensive income (loss) is defined as the change in equity during a period, from transactions and other events, excluding changes resulting from investments by owners (e.g., supplemental stock offering) and distributions to owners (e.g., dividends).

t) Operating segments

The Financial Accounting Standards Board (“FASB”) establishes standards for the way that public companies report information about operating segments in annual financial statements and establishes standards for related disclosures about product and services, geographic areas and major customers. The Company has reviewed the standard and determined that it has three reportable segments, Uniforms and Related Products, Remote Staffing Solutions and Promotional Products.

36

u)  Risks and concentrations

Financial instruments that potentially subject the Company to concentrations of credit risk include cash in banks in excess of federally insured amounts.  The Company manages this risk by maintaining all deposits in high quality financial institutions and periodically performing evaluations of the relative credit standing of the financial institutions. When assessing credit risk the Company considers whether the credit risk exists at both the individual and group level. Consideration is given to the activity, region and economic characteristics when assessing if there exists a group concentration risk. At December 31, 2017 and 2016, the Company had no customers with an accounts receivable balance greater than 11.3% of the total accounts receivable. At December 31, 2017 and 2016, the top five accounts receivable customer balances totaled $14.2 million and $12.9 million, respectively, or approximately 28.0% and 30.8% of the respective total accounts receivable balances. The Company’s largest customer for each of the years ended December 31, 2017, 2016, and 2015 had net sales of approximately $20.6 million, $19.3 million and $12.5 million, respectively, or approximately 7.7%, 7.6% and 6.0% of the respective total net sales for the Company. The Company’s five largest customers for the years ended December 31, 2017, 2016 and 2015 had net sales of approximately $50.7 million, $57.6 million and $48.9 million, respectively, or approximately 19.0%, 22.8% and 23.3% of the respective total net sales for the Company.   

Included in accounts receivable-other on the Company’s consolidated balance sheets at December 31, 2017 and 2016 are receivable balances from a supplier in Haiti totaling $1.5 million and $2.3 million, respectively.

In 2017, 2016 and 2015, approximately 28%, 31% and 26%, respectively, of our products for our Uniform and Related Products segment were sourced from or contained raw materials sourced from China. In 2017, 2016 and 2015, approximately 32%, 32% and 42%, respectively, of our products for our Uniform and Related Products segment were obtained from suppliers located in Central America and Haiti. In 2017 and 2016, approximately 67% and 59%, respectively, of our products for our Promotional Products segment were sourced from China. Any inability by the Company to continue to obtain its products from Central America and Haiti could significantly disrupt the Company’s business. Because the Company manufactures and sources products in Central America and Haiti, the Company is affected by economic conditions in those countries, including increased duties, possible employee turnover, labor unrest and lack of developed infrastructure.

v) Fair value of financial instruments

The carrying amounts of cash and cash equivalents, receivables and accounts payable approximated fair value as of December 31, 2017 and 2016, because of the relatively short maturities of these instruments. The carrying amount of the Company’s long-term debt approximated fair value as the rates are adjustable based upon current market conditions.

w) Stock Split

On December 29, 2014, the Board of Directors declared a 2-for-1 stock split of the Company’s common stock. The record date of the split was January 12, 2015, and the stock split became effective February 4, 2015. All share and per share information in these consolidated interim financial statements have been restated for all periods presented, giving retroactive effect to the stock split. The Company revised certain historical amounts when it recorded the 2-for-1 stock split. The amounts were immaterial and reclassified within shareholders’ equity between par value and additional paid in capital.

x) Use of estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates.

y) Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Topic 606) that will supersede most current revenue recognition guidance, including industry-specific guidance. The core principle of the new guidance is that an entity will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard provides a five-step analysis of transactions to determine when and how revenue is recognized. Other major provisions include the capitalization and amortization of certain contract costs, ensuring the time value of money is considered in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. Additionally, the guidance requires disaggregated disclosures related to the nature, amount, timing, and uncertainty of revenue that is recognized. The amendments are required to be adopted by the Company on January 1, 2018. Transition to the new guidance may be done using either a full or modified retrospective method. The Company will use the modified retrospective transition method with the cumulative effect recorded to the opening balance of retained earnings. The Company’s assessment of the new standard is substantially complete. The timing of revenue recognition is not expected to change for our Remote Staffing Solutions segment. For our Uniforms and Related Products and Promotional Products segments, our revenue is generated from the sale of finished products to customers as products are shipped and title passes to the customers. For certain contracts with customers, the Company creates an asset with no alternative use to the Company, and the Company has enforceable right to payment for performance completed to date. For these contracts, we expect to move from a point in time model for revenue recognition to an over time model. We expect this to have a material impact on the timing of our revenue recognition. As of December 31, 2017 we estimate a net cumulative increase to retained earnings between $10.0 million and $15.0 million. We expect the new standard will have no cash impact and does not affect the economics our underlying customer contracts. We do not expect this new guidance to have any other material impacts on our Consolidated Financial Statements but will significantly expand our disclosures.

37

In April 2015, the FASB issued ASU No. 2015-03 to simplify the presentation of debt issuance costs. The amendments in this ASU require debt issuance costs to be presented on the balance sheet as a reduction from the carrying amount of the related debt liability. The amendment in this ASU is to be applied retrospectively and is effective for interim and annual reporting periods beginning after December 15, 2015. The Company adopted this ASU retrospectively effective January 1, 2016, and has reclassified all debt issuance costs as a reduction from the carrying amount of the related debt liability for both the current and prior period. (See Note 6.)

In February 2016, the FASB issued ASU 2016-02 that amends the accounting guidance on leases. The primary change in this ASU requires lessees to recognize, in the balance sheet, a liability to make lease payments and a right-of-use asset representing the right to use the underlying asset over the lease term. The amendments in this ASU are to be applied using a modified retrospective approach and are effective for fiscal years beginning after December 15, 2018. The Company is in the preliminary phases of assessing the effect of this ASU. We have not yet selected a transition date nor have we yet determined the effect of this ASU on our results of operations, financial condition, or cash flows.

In March 2016, the FASB issued ASU 2016-09, “Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting”. This update was issued as part of FASB’s simplification initiative and affects all entities that issue share-based payment awards to their employees. The amendment requires that excess tax benefits for share-based payments be recorded as a reduction of income tax expense and reflected within operating cash flows rather than being recorded in paid-in-capital and reflected within financing cash flows. The standard also clarifies that all cash payments when directly withholding shares for tax-withholding purposes should be classified as a financing activity on the statement of cash flows and provides for an accounting policy election to account for forfeitures when they occur. The amendments in this update are effective for annual and interim periods beginning after December 15, 2016. Early adoption was permitted in any interim or annual period but must be reflected as of the beginning of the fiscal year. The Company elected to early adopt the standard in the fourth quarter of 2016 which required us to reflect the adjustments as of January 1, 2016. The recognition of excess tax benefits in our provision for income taxes rather than paid-in-capital resulted in an income tax benefit of for the years ended December 31, 2017 and December 31, 2016 of $1.8 million or $0.12 per share and $0.9 million or $0.06 per share, respectively. Lastly, the company has made an accounting policy election to account for forfeitures in compensation cost when they occur. There was no material impact of this election in fiscal 2017.

NOTE 2 - Allowance for Doubtful Accounts Receivable:

The activity in the allowance for doubtful accounts receivable was as follows (in thousands):

	2017			2016			2015
Balance at the beginning of year	$	1,276		$	848		$	680
Provision for bad debts		1,002			523			266
Charge-offs		(901	)		(96	)		(98	)
Recoveries		5			1			-
Balance at the end of year	$	1,382		$	1,276		$	848

NOTE 3 - Reserve for Sales Returns and Allowances:

The activity in the reserve for sales returns and allowances was as follows (in thousands):

	2017			2016			2015
Balance at the beginning of year	$	1,967		$	1,384		$	1,308
Provision for returns and allowances		2,789			4,445			4,547
Actual returns and allowances paid to customers		(3,631	)		(3,862	)		(4,471	)
Balance at the end of year	$	1,125		$	1,967		$	1,384

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NOTE 4 - Inventories:

(In thousands)

	December 31,
	2017		2016
Finished goods	$	54,354	$	57,887
Work in process		604		853
Raw materials		10,021		10,500
	$	64,979	$	69,240

NOTE 5 - Property, Plant and Equipment:

(In thousands)

	December 31,
	2017			2016
Land	$	3,635		$	4,485
Buildings, improvements and leaseholds		18,192			19,140
Machinery, equipment and fixtures		52,594			48,840
		74,421			72,465
Accumulated depreciation and amortization		(47,577	)		(44,932	)
	$	26,844		$	27,533

Depreciation and amortization charges were approximately $3.3 million, $2.6 million and $1.8 million in 2017, 2016, and 2015 respectively.

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NOTE 6 - Long-Term Debt:

(In thousands)	December 31,		December 31,
	2017		2016
Term loan payable to Fifth Third Bank, paid February 28, 2017	$	-	$	39,643
Note payable to Fifth Third Bank, pursuant to revolving credit agreement, paid February 28, 2017	$	-	$	2,540
Note payable to BB&T, pursuant to revolving credit agreement, maturing February 25, 2022	$	1,475	$	-
Term loan payable to BB&T maturing February 26, 2024	$	37,500	$	-
	$	38,975	$	42,183
Less:
Payments due within one year included in current liabilities	$	6,000	$	5,893
Debt issuance costs	$	42	$	63
Long-term debt less current maturities	$	32,933	$	36,227

Effective July 1, 2013, the Company entered into an amended and restated 5-year credit agreement with Fifth Third Bank that made available to the Company up to $15.0 million on a revolving credit basis (the “Initial Credit Facility”) in addition to a $30.0 million term loan utilized to finance the acquisition of substantially all of the assets of HPI Direct, Inc.

Effective March 8, 2016, the Company entered into an amended and restated 5-year credit agreement with Fifth Third Bank (the “Amended Credit Agreement”) that increased its revolving credit facility from $15.0 million to $20.0 million (the “Amended Credit Facility”) and refinanced its then-existing term loan with a new $45.0 million term loan to help finance the acquisition of substantially all of the assets of BAMKO, Inc. Both loans were based upon the one-month LIBOR rate for U.S. dollar based borrowings. Interest was payable on the term loan at LIBOR plus 0.85% and on the revolving credit facility at LIBOR (rounded up to the next 1/8^th of 1%) plus 0.85%. The Company paid a commitment fee of 0.10% per annum on the average unused portion of the commitment under the Amended Credit Facility. This credit agreement was paid in full on February 28, 2017 with the proceeds from a new loan agreement with Branch Banking and Trust Company (“BB&T”).

Effective February 28, 2017, the Company entered into a new 7-year credit agreement with BB&T (the “Credit Agreement”) that provides a new revolving credit facility of $35.0 million (the “Credit Facility”) which terminates on February 25, 2022 and provides a new term loan of $42.0 million (the “Term Loan”) which matures on February 26, 2024. Both loans are based upon the one-month LIBOR rate for U.S. dollar based borrowings. Interest is payable for each loan at LIBOR (rounded up to the next 1/100^th of 1%) plus 0.75% (2.25% at December 31, 2017). The Company pays a commitment fee of 0.10% per annum on the average unused portion of the commitment under the Credit Facility. The available balance under the Credit Facility is reduced by outstanding letters of credit. As of December 31, 2017, there were no amounts due under the Credit Facility and no outstanding letters of credit.

The remaining scheduled amortization for the term loan is as follows: 2018 through 2023 $6.0 million per year; 2024 $1.5 million. The term loan does not include a prepayment penalty. In connection with the Amended Credit Agreement, the Company incurred approximately $0.1 million of debt issuance costs, which primarily consisted of legal fees. These costs are being amortized over the life of the Amended Credit Agreement and are recorded as additional interest expense.

The Company’s obligations under the Amended Credit Agreement are secured by substantially all of the operating assets of Superior Uniform Group, Inc. and are guaranteed by all domestic subsidiaries of Superior Uniform Group, Inc. The agreement contains restrictive provisions concerning a maximum funded senior indebtedness to EBITDA ratio as defined in the agreement (4.0:1) as defined in the agreement and a fixed charge coverage ratio (1.25:1). The Company is in full compliance with all terms, conditions and covenants of the Amended Credit Agreement.

Effective July 1, 2013, in order to reduce interest rate risk on its debt, the Company entered into an interest rate swap agreement with Fifth Third Bank, N.A. that was designed to effectively convert or hedge the variable interest rate on a portion of its borrowings to achieve a net fixed rate of 2.53% per annum, beginning July 1, 2014 with a notional amount of $14.3 million. The notional amount of the interest rate swap was reduced by the scheduled amortization of the principal balance of the original term loan of $0.2 million per month through July 1, 2015 and $0.3 million per month through June 1, 2018 with the remaining notional balance of $3.3 million to be eliminated on July 1, 2018.  Effective March 8, 2016, the fixed rate on the notional amount was reduced to 2.43%.  Effective February 24, 2017, this interest rate swap agreement was terminated. On this date the swap agreement had $0.1 million in cumulative gains in OCI which was reversed to earnings.

Effective March 3, 2017, in order to reduce the interest rate risk on its future debt, the Company entered into an interest rate swap agreement with BB&T that was designed to effectively convert or hedge the variable interest rate on a portion of its future borrowings to achieve a net fixed rate of 3.12% per annum, beginning March 1, 2018 with a notional amount of $18.0 million.  The notional amount of the interest rate swap is reduced by $0.3 million per month beginning April 1, 2018 through February 26, 2024.  Under the terms of the interest rate swap, the Company will receive variable interest rate payments and make fixed interest rate payments on an amount equal to the notional amount at that time.  Changes in the fair value of the interest rate swap designated as the hedging instrument that effectively offset the variability of cash flows associated with the variable rate, long-term debt obligation are recorded in OCI, net of related income tax effects.  As of December 31, 2017, the swap agreement had a negative fair value of $0.1 million which is presented within other current liabilities on the consolidated balance sheet. 

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NOTE 7 – Taxes on Income:

Aggregate income tax provisions consist of the following (in thousands):

	2017		2016			2015
Current:
Federal	$	2,846	$	5,642		$	6,527
Tax Cut and Jobs Act		265		-			-
State and local		647		628			519
Foreign		338		-			-
		4,096		6,270			7,046
Long Term:
Tax Cut and Jobs Act		1,336		-			-
Deferred Taxes:
Deferred tax provision (benefit)		1,899		(1,010	)		(1,216	)
Tax Cut and Jobs Act re-measurement		2,429		-			-
		4,328		(1,010	)		(1,216	)
	$	9,760	$	5,260		$	5,830

The significant components of the deferred income tax asset (liability) are as follows (in thousands):

	2017			2016
Deferred income tax assets:
Pension accruals	$	2,606		$	3,581
Operating reserves and other accruals		2,174			3,656
Tax carrying value in excess of book basis of goodwill		866			1,377
Tax credits		255			99
Valuation allowance on tax credits		(255	)
Deferred income tax liabilities:
Book carrying value in excess of tax basis of property		(937	)		(827	)
Deferred expenses		(1,809	)		(1,086	)
Net deferred income tax asset	$	2,900		$	6,800

The difference between the total statutory Federal income tax rate and the actual effective income tax rate isaccounted for as follows:

	2017			2016			2015
Statutory Federal income tax rate		34.0	%		34.0	%		34.0	%
State and local income taxes, net of Federal income tax benefit		1.5			1.9			1.6
Effect of change in unrecognized tax benefit		-			-			(0.1	)
Current year untaxed foreign income		(6.5	)		(5.1	)		(6.0	)
Foreign Taxes		1.4			-			-
Non-deductible share-based employee compensation expense		1.1			1.2			1.3
Excess tax benefit from stock compensation		(7.2	)		(4.4	)		-
Federal tax credits		(0.5	)		(0.8	)		-
Tax Cut and Jobs Act deferred tax re-measurement		6.9			-			-
Tax on undistributed foreign earnings		2.9			-			-
Transition tax (repatriation)		5.9			-			-
Other items		(0.1	)		(0.4	)		0.1
Effective income tax rate		39.4	%		26.4	%		30.9	%

On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (“Tax Act”) that instituted fundamental changes to the U.S. tax system. The Tax Act includes changes to the taxation of foreign earnings by implementing a dividend exemption system, expansion of the current anti-deferral rules, a minimum tax on low-taxed foreign earnings and new measures to deter base erosion. The Tax Act also permanently reduces the corporate tax rate from 34% to 21%, imposes a one-time mandatory transition tax on the historical earnings of foreign affiliates and implements a territorial style tax system. In 2017, income tax expense of $9.8 million was unfavorably impacted by net discrete adjustments of $4.0 million, due to a charge of $3.3 million related to the enactment of the Tax Cut and Jobs Act (the “Tax Act”) in the United States and $0.7 related to other miscellaneous discrete items.

41

Effective January 1, 2018, the Tax Act establishes a corporate income tax rate of 21%, replacing the current 34% rate, and creates a territorial tax system rather than a worldwide system, which generally eliminates the U.S. federal income tax on dividends from foreign subsidiaries. The transition to the territorial system includes a one-time transition tax on certain of our foreign earnings previously untaxed in the United States. Certain impacts of the new legislation would generally require accounting to be completed in the period of enactment, however, in response to the complexities of the new legislation, the Securities and Exchange Commission (“SEC”) issued guidance to provide companies with relief. Specifically, when the initial accounting for items under the new legislation is incomplete, the guidance allows us to include provisional amounts when reasonable estimates can be made. The SEC has provided up to a one-year measurement period for companies to finalize the accounting for the impacts of this new legislation and we anticipate finalizing our accounting over the coming quarters. While our accounting for the Tax Act is not complete, we have made reasonable estimates for certain provisions and we have recorded a net charge to tax expense of $4.0 million related to its enactment. This net charge includes a deferred tax charge of $1.7 million primarily from revaluing our net U.S. deferred tax assets to reflect the new U.S. corporate tax rate. We believe this calculation is complete except for changes in estimates that can result from finalizing the filing of our 2017 U.S. income tax return, which are not anticipated to be material, and changes that may be a direct impact of other provisional amounts recorded due to the enactment of the Tax Act.

In general, the one-time transition tax imposed by the Tax Act results in the taxation of our accumulated foreign earnings and profits (“E&P”) at a 15.5% rate on liquid assets and 8% on the remaining unremitted foreign E&P, both net of foreign tax credits. At this time, we have not yet gathered, prepared and analyzed the necessary information with respect to 2017 in sufficient detail to complete the complex calculations necessary to finalize the amount of our transition tax. We also anticipate that further guidance may become available in this and other areas. We believe that our preliminary calculations result in a reasonable estimate of the transition tax and related foreign tax credit and, as such have included an estimate of $1.5 million in our year-end income tax provision. As the analysis of accumulated E&P and related foreign taxes paid are completed on an entity by entity basis and we finalize the amount held in cash or other specified assets, we will update our provisional estimate of the transition tax and related foreign tax credit. In addition, the Company no longer intends to permanently reinvest its historical foreign earnings and has recorded an additional deferred tax expense of $0.7 million.

Only tax positions that meet the more-likely-than-not recognition threshold are recognized in the consolidated financial statements. As of December 31, 2017 and 2016, respectively, we have $0.5 million of unrecognized tax benefits, all of which, if recognized, would favorably affect the annual effective income tax rate.  We do not expect any significant amount of this liability to be paid in the next twelve months. Accordingly, the balance of $0.5 million is included in other long-term liabilities.

Changes in the Company’s gross liability for unrecognized tax benefits, excluding interest and penalties, were as follows:

(In thousands)
	2017			2016
Balance at January 1,	$	399		$	399
Additions based on tax positions related to the current year		59			55
Additions for tax positions of prior years		-			4
Reductions due to lapse of statute of limitations		(58	)		(59	)
Balance at December 31,	$	400		$	399

We recognize interest and penalties accrued related to unrecognized tax benefits in the provision for income taxes. During each of the years 2017, 2016 and 2015, we recorded $0.1 million for interest and penalties, net of tax benefits. During each of the years 2017, 2016 and 2015, we reduced the liability $0.1 million for interest and penalties due to lapse of statute of limitations. At December 31, 2017 and 2016, we had $0.1 million accrued for interest and penalties, net of tax benefit.

We anticipate that it is reasonably possible that the total amount of unrecognized tax benefits could decrease by approximately $0.1 million within the next 12 months due to the closure of tax years by expiration of the statute of limitations and audit settlements related to various state tax filing positions. The earliest year open to federal examinations is 2015 and significant state examinations is 2011.

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NOTE 8 – Benefit Plans:

Defined Benefit Plans

The Company is the sponsor of two noncontributory qualified defined benefit pension plans, providing for normal retirement at age 65, covering all eligible employees (as defined). Periodic benefit payments on retirement are determined based on a fixed amount applied to service or determined as a percentage of earnings prior to retirement. The Company is also the sponsor of an unfunded supplemental executive retirement plan (SERP) in which several of its employees are participants. Pension plan assets for retirement benefits consist primarily of fixed income securities and common stock equities.

Effective June 30, 2013, the Company no longer accrues additional benefits for future service or for future increases in compensation levels for the company’s primary defined benefit pension plan. 

Effective December 31, 2014, the Company no longer accrues additional benefits for future service for the Company’s hourly defined benefit plan.

The Company recognizes the funded status of its defined benefit post retirement plans in the Company’s consolidated balance sheets.

At December 31, 2017, the Company’s projected benefit obligation under its supplemental executive retirement pension plan exceeded the fair value of the plans’ assets by $8.4 million and thus the plan is underfunded. The fair value of plan assets for the noncontributory qualified defined benefit pension plans exceeded their projected benefit obligations by $2.2 million and thus the plans are overfunded.

It is our policy to make contributions to the various plans in accordance with statutory funding requirements and any additional funding that may be deemed appropriate.

43

The following tables present the changes in the benefit obligations and the various plan assets, the funded status of the plans, and the amounts recognized in the Company's consolidated balance sheets at December 31, 2017 and 2016:

(In thousands)	December 31,
	2017			2016
Changes in benefit obligation
Benefit obligation at beginning of year	$	25,258		$	24,790
Service cost		65			57
Interest cost		965			988
Actuarial loss		3,755			1,288
Benefits paid		(1,657	)		(1,865	)
Benefit obligation at end of year		28,386			25,258
Changes in plan assets
Fair value of plan assets at beginning of year		15,791			15,865
Actual return on assets		2,413			1,291
Employer contributions		5,598			500
Benefits paid		(1,657	)		(1,865	)
Fair value of plan assets at end of year		22,145			15,791
Funded status at end of year	$	(6,241	)	$	(9,467	)
Amounts recognized in consolidated balance sheet
Other assets	$	2,181		$	-
Other current liabilities		(103	)		-
Long-term pension liability		(8,319	)		(9,467	)
		(6,241	)		(9,467	)
Amounts recognized in accumulated other comprehensive income consist of:
Net actuarial loss	$	10,903		$	9,819

Information for pension plans with projected benefit obligation in excess of plan assets

	December 31,
	2017			2016
Projected benefit obligation	$	28,386		$	25,258
Fair value of plan assets		(22,145	)		(15,791	)
	$	6,241		$	9,467

Components of net periodic benefit cost

	2017			2016			2015
Service cost - benefits earned during the period	$	65		$	57		$	48
Interest cost on projected benefit obligation		965			988			951
Expected return on plan assets		(1,218	)		(1,188	)		(1,343	)
Recognized actuarial loss		1,042			1,027			772
Settlement loss		435			445			460
Net periodic pension cost after settlements	$	1,289		$	1,329		$	888

The pension settlement losses included in the table above relates to lump sum payments made to various employees upon their retirement or termination each year.

The estimated net actuarial loss for the defined benefit pension plans that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next fiscal year is $1.1 million.

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The table below presents various assumptions used in determining the benefit obligation for each year and reflects the percentages for the various plans.

Weighted-average assumptions used to determine benefit obligations at December 31,

							Long Term Rate
	Discount Rate						of Return						Salary Scale
	Corp.			Plants			Corp.			Plants			Corp.		Plants
2016		4.04	%		3.91	%		8.00	%		8.00	%		N/A		N/A
2017		3.53	%		3.45	%		8.00	%		8.00	%		N/A		N/A

Weighted-average assumptions used to determine net periodic benefit cost for years ending December 31,

							Long Term Rate
	Discount Rate						of Return						Salary Scale
	Corp.			Plants			Corp.			Plants			Corp.		Plants
2015		3.86	%		3.74	%		8.00	%		8.00	%		N/A		N/A
2016		4.19	%		4.09	%		8.00	%		8.00	%		N/A		N/A
2017		4.04	%		3.91	%		8.00	%		8.00	%		N/A		N/A

The methodology used to determine the expected rate of return on the pension plan assets was based on a review of actual returns in the past and consideration of projected returns based upon our projected asset allocation. Our strategy with respect to our investments in pension plan assets is to be invested with a long-term outlook. Therefore, the risk and return balance of our asset portfolio should reflect a long-term horizon. Our pension plan asset allocation at December 31, 2017, 2016 and target allocation for 2018 are as follows:

	Percentage of Plan Assets at December 31,						Target Allocation
Investment description	2017			2016			2018
Equity securities		52	%		68	%		52	%
Fixed income		29	%		13	%		29	%
Other		19	%		19	%		19	%
Total		100	%		100	%		100	%

The Company plans to contribute $0.1 million to our defined benefit pension plans in 2018.

The following table includes projected benefit payments for the years indicated:

Year	Projected Benefit Payments
	(in thousands)
2018	$	1,467
2019	$	1,652
2020	$	2,135
2021	$	1,947
2022	$	1,979
2023-2027	$	8,620

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Rabbi Trust

In connection with the Company’s unfunded SERP, we have life insurance contracts on the lives of designated individuals. The insurance contracts associated with the SERP are held in a Rabbi trust.

The trust is the owner and beneficiary of such insurance contracts. The policies are being utilized to help offset the costs and liabilities of the SERP. The cash surrender value of the life insurance contracts was $2.2 million at December 31, 2017. We recognized an investment gain on the cash surrender value of these life insurance contracts of $0.3 million in 2017.  The cash surrender value of these policies is included in other assets in the Consolidated Balance Sheets as of December 31, 2017 and 2016.

In 2013 we initiated a Non-Qualified Deferred Compensation Plan, and we have purchased life insurance contracts on the lives of designated individuals during 2017. The insurance contracts associated with the Non-Qualified Deferred Compensation Plan are also held in a Rabbi trust. The trust is the owner and beneficiary of such insurance contracts. The policies are being utilized to help offset the costs and liabilities of the Non-Qualified Deferred Compensation Plan. The cash surrender value of the life insurance contracts was $2.2 million at December 31, 2017. The cash surrender value of these policies is included in other assets in the Consolidated Balance Sheet as of December 31, 2017. The liability for participant deferrals of $2.2 million is included in other long-term liabilities in the Consolidated Balance Sheet as of December 31, 2017.

Defined Contribution Plan

The Company provides a defined contribution plan covering qualified employees. The plan includes a provision that allows employees to make pre-tax contributions under Section 401(k) of the Internal Revenue Code. The plan provides for the Company to make a guaranteed match equal to 25% of each employee’s eligible contributions. The plan also provides the Company with the option of making an additional discretionary contribution to the plan each year. Currently the discretionary contribution is set at 3% of eligible employees’ payroll. The Company contributions for the years ended December 31, 2017, 2016 and 2015 were approximately $1.0 million, $1.1 million and $0.9 million, respectively.

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NOTE 9 – Quarterly Results for 2015 2016 and 2017 (Unaudited):

(In thousands, except shares and per share data)

	Quarter Ended
	March 31,		June 30,		September 30,		December 31,
	2017		2017		2017		2017
Net sales	$	60,987	$	65,604	$	67,773	$	72,450
Gross profit	$	22,214	$	23,374	$	24,789	$	25,975
Income before taxes on income	$	5,405	$	5,701	$	6,842	$	6,834
Net income	$	3,835	$	4,341	$	4,962	$	1,884
Per Share Data:
Basic
Net earnings	$	0.27	$	0.30	$	0.34	$	0.13
Diluted
Net earnings	$	0.26	$	0.29	$	0.33	$	0.12
Average Outstanding Shares (Basic)		14,350,721		14,501,399		14,573,813		14,614,691
Average Outstanding Shares (Diluted)		14,929,695		15,040,431		15,229,722		15,275,222

	Quarter Ended
	March 31,		June 30,		September 30,		December 31,
	2016		2016		2016		2016
	(restated)		(restated)		(restated)
Net sales	$	57,968	$	64,660	$	65,282	$	64,686
Gross profit	$	20,021	$	21,763	$	23,140	$	22,058
Income before taxes on income	$	3,410	$	4,615	$	6,006	$	5,867
Net income	$	2,442	$	3,308	$	4,447	$	4,441
Per Share Data:
Basic
Net earnings	$	0.18	$	0.23	$	0.31	$	0.31
Diluted
Net earnings	$	0.17	$	0.22	$	0.30	$	0.30
Average Outstanding Shares (Basic)		13,927,063		14,120,617		14,118,354		14,162,939
Average Outstanding Shares (Diluted)		14,668,658		14,957,469		14,984,084		14,979,746

	Quarter Ended
	March 31,		June 30,		September 30,		December 31,
	2015		2015		2015		2015
Net sales	$	46,347	$	54,116	$	56,662	$	53,192
Gross profit	$	15,796	$	18,531	$	19,224	$	17,882
Income before taxes on income	$	3,223	$	5,394	$	5,581	$	4,698
Net income	$	2,043	$	3,624	$	4,031	$	3,368
Per Share Data:
Basic
Net earnings	$	0.15	$	0.26	$	0.29	$	0.24
Diluted
Net earnings	$	0.14	$	0.25	$	0.28	$	0.23
Average Outstanding Shares (Basic)		13,584,922		13,730,646		13,833,561		13,894,907
Average Outstanding Shares (Diluted)		14,548,084		14,577,342		14,585,688		14,603,464

On December 22, 2017, the U.S. enacted the Tax Cuts and Jobs Act (“Tax Act”) that instituted fundamental changes to the U.S. tax system. In the fourth quarter of 2017, income tax expense of $5.0 million was unfavorably impacted by net discrete adjustments of $4.0 million related to the enactment Tax Act. See Note 7.

The Company elected to early adopt ASU 2016-09 in the fourth quarter of 2016. As a result, there was an increase in the income tax benefit of $0.2 million for the three months ended March 31, 2016, $0.2 million for the three months ended June 30, 2016, and $0.1 million for the three months ended September 30, 2016, from the previously reported income tax provisions in the consolidated statements of comprehensive income for the first, second, and third quarters of fiscal year 2016. See Note 1(y).

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NOTE 10 – Rentals:

Aggregate rent expense, including month-to-month rentals, approximated $1.1 million, $1.1 million and $0.3 million for the years ended December 31, 2017, 2016, and 2015, respectively. Long-term lease commitments totaling $2.1 million are as follows: 2018 - $0.9 million, 2019 - $0.6 million, 2020 - $0.5 million, and 2021 - $0.1 million.

NOTE 11 – Contingencies:

The Company is involved in various legal actions and claims arising from the normal course of business. In the opinion of management, the ultimate outcome of these matters will not have a material impact on the Company’s results of operations, cash flows, or financial position.

During 2005, the Company entered into severance protection agreements with senior management. The terms of these agreements require the Company to potentially make certain payments to members of senior management in the event of a change in control of the Company.

NOTE 12 – Share-Based Compensation:

In 2003, the stockholders of the Company approved the 2003 Incentive Stock and Awards Plan (the “2003 Plan”), authorizing the granting of incentive stock options, non-qualified stock options, stock appreciation rights (“SARS”), restricted stock, performance stock and other stock based compensation. This plan expired in May of 2013, at which time, the stockholders of the Company approved the 2013 Incentive Stock and Awards Plan (the “2013 Plan”), authorizing the granting of incentive stock options, non-qualified stock options, SARS, restricted stock, performance shares and other stock based compensation. A total of 5,000,000 shares of common stock (subject to adjustment for expirations and cancellations of options outstanding from the 2003 Plan subsequent to its termination) have been reserved for issuance under the 2013 Plan. All options and SARS under both plans have been or will be granted with exercise prices at least equal to the fair market value of the shares on the date of grant. At December 31, 2017, the Company had 3,667,577 shares of common stock available for grant of share-based compensation under the 2013 Plan.

Share-based compensation is recorded in selling and administrative expense in the consolidated statements of comprehensive income. The following table details the share-based compensation expense by plan and the total related tax benefit for the periods presented:

	Year Ended December 31,
	(In thousands)
	2017		2016		2015
Stock options and SARS	$	1,093	$	1,071	$	1,079
Restricted stock		331		317		282
Performance shares		240		250		-
Total share-based compensation expense	$	1,664	$	1,638	$	1,361
Related income tax benefit	$	229	$	325	$	203

Stock options and SARS

The Company grants stock options and stock settled SARS to employees that allow them to purchase shares of the Company’s common stock. Options are also granted to outside members of the Board of Directors of the Company. The Company determines the fair value of stock options and SARS at the date of grant using the Black-Scholes valuation model.

All options and SARS vest immediately at the date of grant. Awards generally expire five years after the date of grant with the exception of options granted to outside directors, which expire ten years after the date of grant. The Company issues new shares upon the exercise of stock options and SARS.

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A summary of stock option transactions during the two years ended December 31, 2017 follows:

	No. of			Weighted Average
	Shares			Exercise Price
Outstanding December 31, 2015		946,546		$	8.39
Granted		172,862			16.53
Exercised		(279,766	)		7.31
Lapsed		(11,131	)		5.92
Cancelled		(3,260	)		17.53
Outstanding December 31, 2016		825,251		$	10.46
Granted		155,142		$	18.67
Exercised		(336,726	)		8.71
Lapsed		(1,100	)		5.86
Cancelled		(8,690	)		15.82
Outstanding December 31, 2017		633,877		$	13.33

At December 31, 2017, options outstanding, all of which were fully vested and exercisable, had an intrinsic value of $8.5 million. The weighted-average remaining contractual term was 46 months.

Options exercised during the years ended December 31, 2017, 2016 and 2015, had intrinsic values of $4.2 million, $3.1 million and $3.5 million respectively.

The weighted average fair values of the Company’s 155,142, 172,862 and 153,618 options granted during the years ended December 31, 2017, 2016 and 2015 were $5.56 and $4.69 and $5.22, respectively.

During the years ended December 31, 2017, 2016 and 2015, respectively, the Company received $1.9 million, $1.5 million and $1.8 million in cash from stock option exercises. Current tax benefits of $0.8 million, $0.4 million and $0.6 million, respectively, were recognized for these exercises. Additionally, during the years ended December 31, 2017, 2016 and 2015, respectively, the Company received 50,981, 27,770 and 14,571 shares of its common stock as payment of the exercise price in the exercise of stock options for 144,443, 81,608 and 50,224 shares of its common stock related to the exercise of stock options.

The following table summarizes information about stock options outstanding as of December 31, 2017:

Range of					Weighted Average Remaining		Weighted Average
Exercise Price			Shares		Contractual Life (Years)		Exercise Price
$3.82	-	$5.55		59,000		2.08	$	4.81
$5.65	-	$7.36		151,995		1.96	$	6.65
$7.96	-	$10.38		45,100		4.53	$	8.87
$16.35	-	$21.63		377,782		4.79	$	17.88
$3.82	-	$21.63		633,877		3.84	$	13.33

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A summary of stock-settled SARS transactions during the two years ended December 31, 2017 follows:

	No. of			Weighted Average
	Shares			Exercise Price
Outstanding December 31, 2015		381,566		$	8.14
Granted		58,108			16.35
Exercised		(114,168	)		6.27
Lapsed		-			-
Cancelled		-			-
Outstanding December 31, 2016		325,506		$	10.26
Granted		43,988			16.97
Exercised		(222,990	)		6.90
Lapsed		-
Cancelled		-
Outstanding December 31, 2017		146,504		$	17.38

At December 31, 2017, SARS outstanding, all of which were fully vested and exercisable, had an aggregate intrinsic value of $1.4 million. The weighted-average remaining contractual term was 35 months.

SARS exercised during the years ended December 31, 2017, 2016 and 2015, respectively, had intrinsic values of $3.5 million, $1.5 million and $2.6 million respectively. Current tax benefits of $1.3 million, $0.5 million and $1.0 million respectively, were recognized for these exercises. The weighted average grant date fair values of the Company’s SARS granted during the years ended December 31, 2017, 2016 and 2015 was $4.83, $4.49 and $5.20, respectively.

The following table summarizes information about SARS outstanding as of December 31, 2017:

Range of					Weighted Average Remaining		Weighted Average
Exercise Price			SARS		Contractual Life (Years)		Exercise Price
$16.35	-	$18.66		146,504		2.92	$	17.38

At December 31, 2017 shares available for grant as awards under the plan were 3,667,577. Options and SARS have never been repriced by the Company in any year.

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The following table summarizes significant assumptions utilized to determine the fair value of options and SARS:

Years ended
December 31,	SARS	Options
Exercise price
2017	$16.97	$16.97	-	$21.63
2016	$16.35	$16.35	-	$18.55
2015	$18.66	$16.78	-	$18.66
Market price
2017	$16.97	$16.97	-	$21.63
2016	$16.35	$16.35	-	$18.55
2015	$18.66	$16.78	-	$18.66
Risk free interest rate1
2017	1.9%	1.8%	-	2.4%
2016	1.3%	1.1%	-	1.8%
2015	1.5%	1.5%	-	2.1%
Expected award life (years)2	5	5	-	10
Expected volatility3
2017	36.6%	36.6%	-	41.4%
2016	36.5%	36.5%	-	40.3%
2015	34.9%	34.9%	-	39.0%
Expected dividend yield4
2017	2.1%	1.8%	-	2.1%
2016	2.0%	1.8%	-	2.1%
2015	1.6%	1.6%	-	1.9%

¹The risk-free interest rate is based on the yield of a U.S. treasury bond with a similar maturity as the expected life of the awards.

²The expected life in years for awards granted was based on the historical exercise patterns experienced by the Company when the award is made.

³The determination of expected stock price volatility for awards granted in each of the three years ended December 31, 2017, 2016 and 2015 was based on historical Superior common stock prices over a period commensurate with the expected life.

⁴The dividend yield assumption is based on the history and expectation of the Company’s dividend payouts.

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Restricted Stock

The Company has granted restricted stock to directors and certain employees under the terms of the 2013 Plan which vest at a specified future date, generally after three years, or when certain conditions are met. The shares are subject to accelerated vesting under certain circumstances pursuant to the 2013 Plan. Expense for each of these grants is based on the fair value at the date of the grant and is being recognized on a straight-line basis over the respective service period. As of December 31, 2017, the Company had $0.7 million of unrecognized compensation cost related to nonvested grants expected to be recognized over the weighted average service period of 2.01 years.

A summary of restricted stock transactions during the years ended December 31, 2017 follows:

	No. of			Weighted Average
	Shares			Grant Date Fair Value
Outstanding December 31, 2015		114,342		$	8.39
Granted		10,396			16.35
Vested		-			-
Forfeited		(1,050	)		21.92
Outstanding December 31, 2016		123,688		$	8.94
Granted		43,706			18.30
Vested		(106,016	)		7.62
Forfeited		-			-
Outstanding December 31, 2017		61,378		$	17.89

Performance Shares

In 2016, the Compensation Committee of the Board of Directors approved grants of performance shares under the terms of the 2013 Plan. Under the terms of the grants, certain employees received service-based or service-based and performance-based shares. The service-based awards vest after the service period is met, which is generally three to five years.  Expense for these grants is based on the fair value on the date of the grant and is being recognized on a straight-line basis over the respective service period. The performance-based shares generally vest after five years if the performance and service targets are met. The Company evaluates the performance conditions associated with these grants each reporting period to determine the expected number of shares to be issued. Based upon this evaluation, expected expenses for these grants are being recognized based on the fair value on the date of the grant on a straight-line basis over the respective service period. The shares are subject to accelerated vesting under certain circumstances as outlined in the 2013 Plan. As of December 31, 2017, the Company had $1.6 million of unrecognized compensation cost related to nonvested grants expected to be recognized over the weighted average service period of 3.25 years.

A summary of performance share transactions during the year ended December 31, 2017 follows:

	No. of			Weighted Average
	Shares			Grant Date Fair Value
Outstanding December 31, 2016		101,000		$	16.36
Granted		50,826			18.39
Vested		-			-
Forfeited		(33,334	)		16.35
Outstanding December 31, 2017		118,492		$	17.24

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NOTE 13 – Earnings Per Share:

The following table represents a reconciliation of basic and diluted earnings per share:

	2017		2016		2015
Net earnings used in the computation of basic and diluted earnings per share (in thousands)	$	15,022	$	14,638	$	13,066
Weighted average shares outstanding - basic		14,510,156		14,082,243		13,761,009
Common stock equivalents		608,612		815,246		817,635
Total weighted average shares outstanding - diluted		15,118,768		14,897,489		14,578,644
Per Share Data:
Basic
Net earnings	$	1.04	$	1.04	$	0.95
Diluted
Net earnings	$	0.99	$	0.98	$	0.90

Awards to purchase an average of 37,450 shares of common stock with a weighted average exercise price of $18.65 per share were outstanding during 2017 but were not included in the computation of diluted EPS because the awards’ exercise prices were greater than the average market price of the common shares. Awards to purchase an average of 124,000 shares of common stock with a weighted average exercise price of $18.53 per share were outstanding during 2016 but were not included in the computation of diluted EPS because the awards’ exercise prices were greater than the average market price of the common shares. Awards to purchase an average of 108,400 shares of common stock with a weighted average exercise price of $17.98 per share were outstanding during 2015 but were not included in the computation of diluted EPS because the awards’ exercise prices were greater than the average market price of the common shares.

NOTE 14 – Other Current Liabilities:

(In thousands)

	Year Ended December 31,
	2017		2016
Salaries, wages, commissions and vacation pay	$	7,851	$	5,600
Accrued rebates		1,089		1,932
Defined contribution plan accrual		104		897
Customer deposits		473		670
Other accrued expenses		2,892		1,617
	$	12,409	$	10,716

NOTE 15 – Supplemental Cash Flow Information:

 (In thousands)

	Year Ended December 31,
	2017		2016		2015
Income taxes paid	$	7,173	$	5,076	$	6,897
Interest paid	$	727	$	694	$	523

During the years ended December 31, 2017, 2016, and 2015 the Company received 50,981, 27,770 and 14,571 shares, respectively, of its common stock as payment for the exercise of stock options for 144,443, 81,608 and 50,224 shares, respectively.

NOTE 16 – Stock Repurchase Plan:

On August 1, 2008, the Company’s Board of Directors approved an increase to the outstanding authorization under its common stock repurchase program to allow for the repurchase of 1,000,000 additional shares of the Company’s outstanding shares of common stock. Under this program the Company reacquired and retired -0-, 45,100 and -0- shares of its common stock in the years ended December 31, 2017, 2016 and 2015, respectively. At December 31, 2017, the Company had 216,575 shares remaining on its common stock repurchase program. Shares purchased under the common stock repurchase program are constructively retired and returned to unissued status. The Company considers several factors in determining when to make share repurchases, including among other things, the cost of equity, the after-tax cost of borrowing, the debt to total capitalization targets and the expected future cash needs. There is no expiration date or other restriction governing the period over which the Company can make its share repurchases under the program.

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NOTE 17 – Operating Segment Information:

The Company classifies its businesses into three operating segments based on the types of products and services provided. The Uniforms and Related Products segment consists of the sale of uniforms and related items. The Remote Staffing Solutions segment consists of sales of staffing solutions. The Promotional Products segment consists of sales to customers of promotional products and other branded merchandise.

The Company evaluates the performance of each operating segment based on several factors of which the primary financial measures are operating segment net sales and earnings before income taxes. The accounting policies of the operating segments are the same as those described in Note 1 entitled Summary of Significant Accounting Policies. Amounts for corporate expenses are included in the Uniforms and Related Products segment totals. Information related to the operations of the Company's operating segments is set forth below:

(In thousands)
	Uniforms and Related Products			Remote Staffing Solutions		Promotional Products		Intersegment Eliminations			Total
Twelve Months Ended
December 31, 2017
Net sales	$	204,644		$	23,021	$	42,904	$	(3,755	)	$	266,814
Gross margin	$	72,463		$	12,460	$	13,860	$	(2,431	)	$	96,352
Selling and administrative expenses		54,191			7,877		12,179		(2,431	)		71,816
Gain (loss) on sale of property, plant and equipment		(2	)		1,050		-		-			1,048
Interest expense		387			-		415		-			802
Income before taxes on income	$	17,883		$	5,633	$	1,266	$	-		$	24,782
Depreciation and amortization	$	4,223		$	846	$	584	$	-		$	5,653
Capital expenditures	$	2,870		$	1,156	$	219	$	-		$	4,245
Total assets	$	182,623		$	21,846	$	54,997	$	(40,528	)	$	218,938

	Uniforms and Related Products		Remote Staffing Solutions		Promotional Products			Intersegment Eliminations			Total
Twelve Months Ended
December 31, 2016
Net sales	$	210,373	$	17,953	$	27,816		$	(3,546	)	$	252,596
Gross margin	$	69,987	$	9,616	$	9,690		$	(2,311	)	$	86,982
Selling and administrative expenses		52,225		6,096		10,386			(2,311	)		66,396
Interest expense		462		-		226			-			688
Income before taxes on income (loss)	$	17,300	$	3,520	$	(922	)	$	-		$	19,898
Depreciation and amortization	$	4,023	$	494	$	418		$	-		$	4,935
Capital expenditures	$	3,383	$	3,872	$	130		$	-		$	7,385
Total assets	$	176,070	$	19,752	$	28,480		$	(27,454	)	$	196,848

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	Uniforms and Related Products		Remote Staffing Solutions		Promotional Products		Intersegment Eliminations			Total
Twelve Months Ended
December 31, 2015
Net sales	$	198,319	$	15,604	$	-	$	(3,606	)	$	210,317
Gross margin	$	65,247	$	8,579	$	-	$	(2,393	)	$	71,433
Selling and administrative expenses		49,225		5,186		-		(2,393	)		52,018
Interest expense		519		-		-		-			519
Income before taxes on income	$	15,503	$	3,393	$	-	$	-		$	18,896
Depreciation and amortization	$	3,561	$	312	$	-	$	-		$	3,873
Capital expenditures	$	3,003	$	5,066	$	-	$	-		$	8,069
Total assets	$	140,710	$	14,551	$	-	$	(3,530	)	$	151,731

NOTE 18 – Acquisition of Businesses:

BAMKO

On March 8, 2016, the Company closed on the acquisition of substantially all of the assets of BAMKO, Inc.  The transaction had an effective date of March 1, 2016.  The purchase price for the asset acquisition consisted of approximately $15.2 million in cash, net of cash acquired, the issuance of approximately 324,000 restricted shares of Superior’s common stock that vest over a five-year period, potential future payments of approximately $5.5 million in additional contingent consideration through 2021, and the assumption of certain liabilities of BAMKO, Inc.  The transaction also included the acquisition of BAMKO, Inc.’s subsidiaries in Hong Kong, China, Brazil and England as well as an affiliate in India.

The foregoing description of the asset purchase agreement does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the agreement, which is filed as an exhibit to the Quarterly Report on Form 10-Q filed on April 28, 2016.

Fair Value of Consideration Transferred

A Summary of the purchase price is as follows (in thousands):
Cash consideration at closing, net of cash acquired	$	15,161
Restricted shares of Superior common stock issued		4,558
Contingent consideration		5,205
Total Considerations	$	24,924

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Assets Acquired and Liabilities Assumed

The total purchase price was allocated to the acquired tangible and intangible assets and assumed liabilities of BAMKO, Inc. based on their estimated fair values as of March 1, 2016. The excess of the purchase price over the estimated fair values of the assets acquired and liabilities assumed was allocated to goodwill.

The following table presents the allocation of the total fair value of consideration transferred, as shown above, to the acquired tangible and intangible assets and assumed liabilities of BAMKO based on their fair values as of the effective date of the transaction.

The following is our assignment of the aggregate consideration (in thousands):

Accounts receivable	$	4,885
Prepaid expenses and other current assets		3,200
Inventories		236
Property, plant and equipment		199
Other Assets		100
Identifiable intangible assets		11,360
Goodwill		6,994
Total assets	$	26,974
Accounts Payables		1,314
Other current liabilities		736
Total liabilities	$	2,050

The Company recorded $11.4 million in identifiable intangibles at fair value, consisting of $2.1 million in acquired customer relationships, $0.4 million in non-compete agreements from the former owners of BAMKO, Inc., and $8.9 million for the acquired trade name.

The estimated fair value for acquisition-related contingent consideration payable is $5.2 million as of December 31, 2017. The Company will continue to evaluate this liability for remeasurement at the end of each reporting period and any change will be recorded in the Company’s consolidated statement of comprehensive income. The carrying amount of the liability may fluctuate significantly and actual amounts paid may be materially different from the estimated value of the liability.

Goodwill was calculated as the difference between the fair value of the consideration and the values assigned to the assets acquired and liabilities assumed.

The intangible assets associated with the customer relationships will be amortized for seven years beginning on March 1, 2016 and the non-compete agreement will be amortized for five years and ten months. The trade name is considered an indefinite-life asset and as such will not be amortized.

The Company recognized amortization expense on these acquired intangible assets of $0.4 million for the year ended December 31, 2017 and $0.3 million for the year ended December 31, 2016.

For the year ended December 31, 2016, the Company incurred and expensed transaction related expenses of approximately $1.1 million. This amount is included in selling and administrative expenses on the consolidated statements of comprehensive income.

On a pro forma basis as if the results of this acquisition had been included in our consolidated results for the years ended December 31, 2016 and 2015, net sales would have increased approximately $6.6 million and $31.5 million respectively.  Net income would have increased $1.1 million or $0.08 per share for the year ended December 31, 2016, and decreased by $0.4 million or $0.03 per share for the year ended December 31, 2015.  Pre-tax acquisition related expenses of $1.1 million have been recorded as though they were incurred as of January 1, 2014 for this comparison.

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Public Identity

On August 21, 2017, BAMKO acquired substantially all of the assets and assumed certain liabilities of PublicIdentity, Inc. (“Public Identity”) of Los Angeles, CA. Public Identity is a promotional products and branded merchandise agency that provides innovative, high quality merchandise and promotional products to corporate clients and universities across the country.

The purchase price for the acquisition consisted of $0.8 million in cash, the issuance of approximately 54,000 restricted shares of Superior’s common stock and future payments of approximately $0.4 million in additional consideration through 2020.  The majority of the shares issued vest over a three-year period.  The preliminary estimated fair value of the consideration transferred is approximately $2.3 million.  Based upon our preliminary estimates of their acquisition date fair values, we have assigned approximately $1.7 million to identifiable intangible assets and approximately $0.6 million to goodwill.  Our final fair value determinations may be significantly different. 

Tangerine Promotions

On November 30, 2017, BAMKO closed on the acquisition of substantially all of the assets of Tangerine Promotions, Ltd and Tangerine Promotions West, Inc. (collectively “Tangerine”). The transaction had an effective date of December 1, 2017.  Tangerine is a promotional products and branded merchandise agency that serves many well-known brands.  The company is one of the leading providers of Point-of-Purchase (POP) and Point-of-Sale (POS) merchandise in the country.  The purchase price for the asset acquisition consisted of approximately $7.2 million in cash, subject to adjustment, the issuance of approximately 83,000 restricted shares of Superior’s common stock that vests over a four-year period, the potential future payments of approximately $5.5 million in additional contingent consideration through 2021, and the assumption of certain liabilities.

The foregoing description of the asset purchase agreement does not purport to be complete and is subject to, and qualified in its entirety by, the full text of the agreement, which is filed as an exhibit to this Annual Report.

Fair Value of Consideration Transferred

A Summary of the purchase price is as follows (in thousands):
Cash consideration at closing	$	7,222
Restricted shares of Superior common stock issued		1,657
Contingent consideration		3,209
Total Considerations	$	12,088

Assets Acquired and Liabilities Assumed

The total purchase price was allocated to the acquired tangible and intangible assets and assumed liabilities of Tangerine based on their estimated fair values as of December 1, 2017. The excess of the purchase price over the estimated fair values of the assets acquired and liabilities assumed was allocated to goodwill.

The following table presents the allocation of the total fair value of consideration transferred, as shown above, to the acquired tangible and intangible assets and assumed liabilities of Tangerine based on their estimated fair values as of the effective date of the transaction.

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The assets and liabilities of Tangerine shown below are based on our preliminary estimates of their acquisition date fair values. Our final fair value determinations may be significantly different than those shown below.

The following is our preliminary assignment of the aggregate consideration (in thousands):

Accounts receivable	$	5,051
Prepaid expenses and other current assets		969
Property, plant and equipment		131
Identifiable intangible assets		6,495
Goodwill		4,169
Total assets	$	16,815
Accounts Payables		3,374
Other current liabilities		1,353
Total liabilities	$	4,727

The Company recorded $6.5 million in identifiable intangibles at fair value, consisting of $3.1 million in acquired customer relationships, $0.2 million in non-compete agreements from the former owners of Tangerine, and $3.2 million for the acquired trade name.

The estimated fair value for acquisition-related contingent consideration payable is $3.2 million as of December 31, 2017. The Company will continue to evaluate this liability for remeasurement at the end of each reporting period and any change will be recorded in the Company’s consolidated statement of comprehensive income. The carrying amount of the liability may fluctuate significantly and actual amounts paid may be materially different from the estimated value of the liability.

Goodwill was calculated as the difference between the fair value of the consideration and the values assigned to the assets acquired and liabilities assumed.

The intangible assets associated with the customer relationships will be amortized for seven years beginning on December 1, 2017 and the non-compete agreement will be amortized for seven years. The trade name is considered an indefinite-life asset and as such will not be amortized.

The Company recognized amortization expense on these acquired intangible assets of $0.1 million for the year ended December 31, 2017.

For the year ended December 31, 2017, the Company incurred and expensed transaction related expenses of approximately $0.2 million. This amount is included in selling and administrative expenses on the consolidated statements of comprehensive income.

On a pro forma basis as if the results of this acquisition had been included in our consolidated results for the entire year ended December 31, 2017 and years ended December 31, 2016 and 2015, net sales would have increased approximately $35.1 million,  $43.1 million and $48.0 million respectively.  Net income would have increased $0.1 million in 2017, decreased $2.4 million or $0.17 per share in 2016, and increased $1.9 million or $0.13 per share in 2015.   Pre-tax acquisition related expenses of $0.2 million have been recorded as though they were incurred as of January 1, 2015 for this comparison.

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Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A. 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, Andrew D. Demott, Jr., 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 December 31, 2017, that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

Management’s Report on Internal Control over Financial Reporting

Management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). The Company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Internal control over financial reporting includes those policies and procedures that:

● pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of the assets of the Company; and

● provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the Company are being made only in accordance with authorizations of management and directors of the Company; and

● provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Management conducted an evaluation of the effectiveness of the Company’s internal control over financial reporting based on the criteria set forth in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission.

The Company acquired substantially all of the assets of Public Identity, Inc. (“Public Identity”) and Tangerine Promotions, Ltd. and Tangerine Promotions West, Inc. (collectively “Tangerine”) during 2017, and Management excluded from the evaluation of, and conclusion on, the effectiveness of the Company’s internal control over financial reporting as of  December 31, 2017, Public Identity and Tangerine’s internal control over financial reporting associated with total assets of $3.2 million and $16.4 million respectively; and total revenues of $1.8 million and $2.7 million respectively included in the Company’s consolidated financial statements as of and for the year ended December 31, 2017.

Based on this evaluation, management concluded that the Company’s internal control over financial reporting was effective as of December 31, 2017.

The Company’s independent registered public accounting firm, Mayer Hoffman McCann P.C., has issued a report on the effectiveness of the Company’s internal control over financial reporting, which appears in Part II, Item 8 of this Form 10-K. Mayer Hoffman McCann P.C.’s audit of the Company’s internal control over financial reporting also excluded an evaluation of both Public Identity and Tangerine’s internal control over financial reporting.

59

Item 9B. Other Information

None.

PART III

Item 10. Directors, Executive Officers and Corporate Governance

The information required by this Item is incorporated herein by reference to the Company’s definitive proxy statement to be filed in connection with its 2018 Annual Meeting of Shareholders.

Item 11. Executive Compensation

The information required by this Item is incorporated herein by reference to the Company’s definitive proxy statement to be filed in connection with its 2018 Annual Meeting of Shareholders.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Equity Compensation Plan Information

The following table provides information about our common stock that may be issued upon the exercise of options, warrants, rights and restricted stock under all our existing equity compensation plans as of December 31, 2017, including the 2003 Incentive Stock and Awards Plan and the 2013 Incentive Stock and Awards Plan :

			Number of securities
			remaining available
	Number of securities		for future
	to be issued upon	Weighted-average	issuance under equity
	exercise of	exercise price of	compensation plans
	outstanding options,	outstanding options,	(excluding securities
Plan category	warrants and rights	warrants and rights	reflected in column (a))
	(a)	(b)	(c)
Equity compensation Plans approved by Security holders	780,381	$14.09	3,667,577
Equity compensation Plans not approved by Security holders	-	-	-
Total	780,381	$14.09	3,667,577

All other information required by this Item is incorporated herein by reference to the Company’s definitive proxy statement to be filed in connection with its 2018 Annual Meeting of Shareholders.

Item 13. Certain Relationships and Related Transactions, and Director Independence

The information required by this Item is incorporated herein by reference to the Company’s definitive proxy statement to be filed in connection with its 2018 Annual Meeting of Shareholders.

Item 14. Principal Accountant Fees and Services

The information required by this Item is incorporated herein by reference to the Company’s definitive proxy statement to be filed in connection with its 2018 Annual Meeting of Shareholders.

60

PART IV

Item 15.		Exhibits and Financial Statement Schedules			Page
(a)	1.		Consolidated Financial Statements
			The following financial statements of Superior Uniform Group, Inc. are included in Part II, Item 8:
				Independent Auditors' Report	27
				Consolidated statements of comprehensive income - years ended December 31, 2017 and 2016	28
				Consolidated balance sheets - December 31, 2017 and 2016	29
				Consolidated statements of shareholders' equity and comprehensive income - years ended December 31, 2017,  2016 and 2015	30
				Consolidated statements of cash flows - years ended December 31, 2017, 2016 and 2015	32
				Notes to consolidated financial statements	33-58
(a)	2.		Financial Statement Schedules
			All schedules are omitted because they are not applicable, or not required, or because the required information is included in the consolidated financial statements or notes thereto.
(a)	3.		Exhibits
				See Exhibit Index

61

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) 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.

SUPERIOR UNIFORM GROUP, INC.

/s/ Michael Benstock

By: Michael Benstock

Chief Executive Officer (Principal Executive Officer)

DATE: February 22, 2018

POWER OF ATTORNEY

BY THESE PRESENTS, each person whose signature appears below constitutes and appoints each of Michael Benstock, Andrew D. Demott, Jr. and Jordan M. Alpert his or her true and lawful attorney-in-fact and agent, with full power of substitution and resubstitution for him or her and in his or her name, place and stead, in any and all capacities to sign any and all amendments to this Annual Report on Form 10-K, and to file the same, with all exhibits thereto, and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that said attorney-in-fact or his or her substitute, each acting alone, may lawfully do or cause to be done by virtue thereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

/s/ Michael Benstock

Michael Benstock, February 22, 2018

Chief Executive Officer

(Principal Executive Officer)

and Director

/s/ Andrew D. Demott, Jr.

Andrew D. Demott, Jr., February 22, 2018

Chief Operating Officer, Chief Financial Officer and Treasurer

(Principal Financial Officer and Principal Accounting Officer)

/s/ Sidney Kirschner	/s/ Alan Schwartz
Sidney Kirschner, February 22, 2018	Alan Schwartz, February 22, 2018
(Chairperson of the Board)	(Director)
/s/ Paul Mellini	/s/ Robin Hensley
Paul Mellini, February 22, 2018	Robin Hensley, February 22, 2018
(Director)	(Director)
/s/ Todd Siegel
Todd Siegel, February 22, 2018
(Director)

62

SUPERIOR UNIFORM GROUP, INC.
EXHIBIT INDEX

Exhibit No.	Description
3.1	Amended and Restated Articles of Incorporation of the Registrant filed as Exhibit 3.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 1998 (File/Film No.: 001-05869/98680627) and incorporated herein by reference.
3.2	Bylaws of the Registrant, filed as Exhibit 3.2 to the Form 8-K filed on May 10, 2016 (File/Film No.: 001-05869/161636438) and incorporated herein by reference.
10.1*	Form of Director/Officer Indemnification Agreement filed as Exhibit 10 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2006 (File/Film No.: 001-05869/06821111), and incorporated herein by reference.
10.2	1994 Superior Surgical Mfg. Co., Inc. Supplemental Pension Plan as amended and restated on July 30, 2013, filed as Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed on August 2, 2013 (File/Film No.: 001-05869/131006163) and incorporated herein by reference.
10.3	1994 Superior Surgical Mfg. Co., Inc. Supplemental Pension Plan as amended and restated on November 7, 2008, filed as Exhibit 10.4 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2008 (File/Film No.: 001-05869/09641805) and incorporated herein by reference.
10.4*	2003 Incentive Stock and Awards Plan of the Registrant filed as Exhibit 4 to the Registrant’s June 6, 2003 Registration Statement on Form S-8 (File/Film No.: 333-105906/03735570), and incorporated herein by reference.
10.5*	Form of [Incentive] Stock Option Award, filed as Exhibit 10.6 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2008 (File/Film No.: 001-05869/09641805), and incorporated herein by reference.
10.6*	Form of Stock Appreciation Right Award, filed as Exhibit 10.7 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2008 (File/Film No.: 001-05869/09641805), and incorporated herein by reference.
10.7*	Severance Protection Agreement with Michael Benstock, dated November 23, 2005, filed as Exhibit 99.1 to the Registrant’s Current Report on Form 8-K filed on November 28, 2005 (File/Film No.: 001-05869/051228333) and incorporated herein by reference.
10.8*	Severance Protection Agreement with Alan Schwartz, dated November 23, 2005, filed as Exhibit 99.2 to the Registrant’s Current Report on Form 8-K filed on November 28, 2005 (File/Film No.: 001-05869/051228333) and incorporated herein by reference.
10.9*	Severance Protection Agreement with Peter Benstock, dated November 23, 2005, filed as Exhibit 99.3 to the Registrant’s Current Report on Form 8-K filed on November 28, 2005 (File/Film No.: 001-05869/051228333) and incorporated herein by reference.
10.10*	Severance Protection Agreement with Andrew D. Demott, Jr., dated November 23, 2005, filed as Exhibit 99.4 to the Registrant’s Current Report on Form 8-K filed on November 28, 2005 (File/Film No.: 001-05869/051228333) and incorporated herein by reference.
10.11*	Separation, General Release and Non-Compete Agreement with Gerald M. Benstock, dated December 17, 2012, filed as Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed on December 21, 2012 (File/Film No.: 001-05869/121280661) and incorporated herein by reference.
10.12*	Amendment No. 1 to Separation, General Release and Non-Compete Agreement with Gerald M. Benstock, dated November 17, 2015, filed as Exhibit 10.29 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2015 (File/Film No. 001-05869/161454440) and incorporated herein by reference.
10.13*	2013 Incentive Stock and Awards Plan of the Registrant filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on May 7, 2013 (File/ Film No.: 001-05869/13819069), and incorporated herein by reference.
10.14*	Form of Incentive Stock Option Agreement With Vesting Provisions, filed as Exhibit 10.2 to Registrant’s Current Report on Form 8-K filed on May 7, 2013 (File/Film No.: 001-05869/13819069) and incorporated herein by reference.
10.15*	Form of Stock Appreciation Rights Agreement, filed as Exhibit 10.3 to Registrant’s Current Report on Form 8-K filed on May 7, 2013 (File/Film No.: 001-05869/13819069) and incorporated herein by reference.
10.16*	Form of Non-Qualified Stock Option Grant For Outside Directors, filed as Exhibit 10.4 to Registrant’s Current Report on Form 8-K filed on May 7, 2013 (File/Film No.: 001-05869/13819069) and incorporated herein by reference.
10.17*	Form of Incentive Stock Option Agreement With Vesting Provisions, filed as Exhibit 10.5 to Registrant’s Current Report on Form 8-K filed on May 7, 2013 (File/Film No.: 001-05869/13819069) and incorporated herein by reference.
10.18*	Superior Uniform Group, Inc. Deferred Compensation Plan, filed as Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed on August 2, 2013 (File/Film No.: 001-05869/131006163) and incorporated herein by reference.
10.19*	Superior Uniform Group, Inc. Trust Agreement, filed as Exhibit 10.2 to Registrant’s Current Report on Form 8-K filed on August 2, 2013 (File/Film No.: 001-05869/131006163) and incorporated herein by reference.
10.20	Asset Purchase Agreement, dated July 1, 2013, among Superior Uniform Group, Inc., HPI Direct, Inc., Richard J. Sosebee, Kirby P. Sims, Jr. and Frederick L. Hill, III, filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2013 (File/Film No.: 001-05869/13989439) and incorporated herein by reference.
10.21	Asset Purchase Agreement, by and among BAMKO, Inc., the Shareholders of BAMKO, Inc., and Prime Acquisition I, LLC, dated as of March 1, 2016, filed as Exhibit 2.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2016 (File/Film No. 001-05869/161597459) and incorporated herein by reference.
10.22	Third Amended and Restated Credit Agreement, dated March 8, 2016, among Fifth Third Bank, as lender, and Superior Uniform Group, Inc., as borrower, and each other loan party from time to time party thereto, and Exhibits thereto, filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2016 (file/Film No.: 001-05869-161597459) and incorporated herein by reference.

63

10.23*(1)	Form of Restricted Stock Agreement, filed as Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed on February 13, 2014 (File/Film No.: 001-05869/14603415) and incorporated herein by reference.
10.24*	Form of Performance Share Agreement, filed as Exhibit 10.30 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2015 (File/Film No. 001-05869/161454440) and incorporated herein by reference.
10.25*	Amendment No. 2 to Separation, General Release and Non-Compete Agreement with Gerald M. Benstock, dated November 8, 2016.
10.26	Credit Agreement, dated February 28, 2017 among Branch Banking & Trust Company, as lender, and Superior Uniform Group, Inc., as borrower, and each other loan party from time to time party thereto, and Exhibits thereto, filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on March 2, 2017 (file/Film No.: 001-05869/17656945) and incorporated herein by reference.
10.27	Asset Purchase Agreement, by and among Tangerine Promotions, Ltd., Tangerine Promotions West, Inc., Steve Friedman, Adam Rosenbaum, and BAMKO, LLC, dated as of December 1, 2017, filed as Exhibit 2.1 to the Registrant’s Current Report on Form 8-K filed on December 1, 2017 (File/Film No. 001-05869/171233042) and incorporated herein by reference.
10.28(2) *	Amendment No. 3 to Separation, General Release and Non-Compete Agreement with Gerald M. Benstock, dated November 2, 2017.
10.29*	Retirement and Consulting Agreement with Alan D. Schwartz, dated March 8, 2017, filed as Exhibit 10.1 to Registrant’s Current Report on Form 8-K filed on March 13, 2017 (File/Film No.: 001-05869/17685080) and incorporated herein by reference
21.1(2)	Subsidiaries of the Registrant.
23.1(2)	Consent of Independent Registered Public Accounting Firm - Mayer Hoffman McCann P.C.
24	Power of Attorney (included on the signature page hereto)
31.1(2)	Certification of Chief Executive Officer (Principal Executive Officer) pursuant to Rule 13a-14(a)/Rule 15d-14(a) under the Securities Exchange Act of 1934, as amended.
31.2(2)	Certification of Chief Financial Officer (Principal Financial Officer) pursuant to Rule 13a-14(a)/Rule 15d-14(a) under the Securities Exchange Act of 1934, as amended.
32.1(2)	Written Statement of Chief Executive Officer pursuant to 18 U.S.C. Section 1350.
32.2(2)	Written Statement of Chief Financial Officer pursuant to 18 U.S.C. Section 1350.
101.INS+	XBRL Instance Document.
101.SCH+	XBRL Taxonomy Extension Schema Document.
101.CAL+	XBRL Taxonomy Extension Calculation Linkbase Document.
101.DEF+	XBRL Taxonomy Extension Definition Linkbase.
101.LAB+	XBRL Taxonomy Extension Label Linkbase Document.
101.PRE+	XBRL Taxonomy Extension Presentation Linkbase Document.

* Management contracts and compensatory plans and arrangements.

+ Submitted electronically with this Annual Report.

(1) On November 1, 2017, the Chairperson of the Registrant’s Board of Directors, Sidney Kirschner, received a restricted stock grant that is subject to acceleration upon Mr. Kirschner’s retirement from or decision to not seek re-election to the Company’s board of directors, if such retirement or decision occurred at least one (1) year after the grant date. In all other material respects the restricted stock award agreement is identical to the Form of Restricted Stock Agreement listed in the Exhibit Index under Exhibit 10.23.

(2) Filed herewith.

64

EX-10.28

EXHIBIT 10.28

AMENDMENT NUMBER THREE TO THE

SEPARATION, GENERAL RELEASE AND NON-COMPETE AGREEMENT

This Amendment Number Three (the “Third Amendment”), by and between Superior Uniform Group, Inc., with its principal offices at 10055 Seminole Boulevard, Seminole, Florida 33772 (“Superior” or the “Company”), and Gerald M. Benstock (“Benstock”), is made as of November 2, 2017 (the “Third Amendment Effective Date”). Superior and Benstock may hereinafter each be referred to as a “Party,” or collectively as the “Parties.”

WHEREAS, Superior and Benstock entered into a Separation, General Release and Non-Compete Agreement, effective December 17, 2012; and

WHEREAS, Superior and Benstock entered into Amendment Number One to the Separation, General Release and Non-Compete Agreement, effective November 17, 2015; and

WHEREAS, Superior and Benstock entered into Amendment Number Two to the Separation, General Release and Non-Compete Agreement, effective November 8, 2016 (together with the Separation, General Release and Non-Compete Agreement and Amendment Number One, the “Agreement”); and

WHEREAS, Superior has determined that it would gain value from Benstock continuing to provide advisory services to the Company and Benstock has determined that he would like to continue to provide advisory services to the Company; and

WHEREAS, the Parties wish to further amend the Agreement.

NOW THEREFORE, the Parties, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, agree as follows:

1.     The initial recitals stated above are true and correct and are incorporated by reference. Capitalized terms have the meaning ascribed to them in the Agreement, unless otherwise defined in this Third Amendment.

2.     As of the Third Amendment Effective Date, Section 1 of the Agreement is deleted in its entirety and replaced with the following:

This Agreement is effective from December 16, 2012 through December 15, 2018, inclusive (the “Term”). The Term shall be comprised of six (6) one-year periods (each, a “Period”), each of which commences on December 16 of its respective year (each, a “Period Start Date”).

3.     As of the Third Amendment Effective Date, Section 14 of the Agreement is amended as follows:

a. The words seven hundred and fifty thousand dollars ($750,000.00) are deleted and replaced with “nine hundred thousand dollars ($900,000.00)”; and

b. The following sentence shall replace current final sentence of the section:

The one hundred and fifty thousand dollars ($150,000.00) that pertains to the sixth Period of the Agreement shall be paid in four (4) equal installments, with each installment payment to be paid according to the following schedule: first payment to be made during the month of December, 2017, but in no event before the applicable Period Start Date; the second payment to be made during March, 2018; the third payment to be made during June, 2018; and the fourth payment to be made during September, 2018.

4.     The remaining terms and conditions of the Agreement remain unchanged and are hereby ratified and confirmed.

IN WITNESS WHEREOF, a duly authorized representative of each Party has executed this Third Amendment as of the Third Amendment Effective Date.

GERALD M. BENSTOCK

______________________________

Gerald M. Benstock

SUPERIOR UNIFORM GROUP, INC.

______________________________

Sidney Kirschner

Chairperson of the Board of Directors

______________________________

Michael Benstock

Chief Executive Officer

EX-21.1

EXHIBIT 21.1

Superior uniform group, Inc.

LIST OF SUBSIDIARIES

Fashion Seal Corporation	Nevada
The Office Gurus, LLC	Florida
SUG Holding	Cayman Islands
The Office Gurus LTDA. De C.V.,
a subsidiary of SUG Holding and Fashion Seal Corporation	El Salvador
The Office Masters, LTDA. De C.V.,
a subsidiary of SUG Holding and Fashion Seal Corporation	El Salvador
The Office Gurus, Ltd.,
a subsidiary of SUG Holding and Fashion Seal Corporation	Belize
Power Three Web Ltda.,
a wholly owned subsidiary of SUG Holding	Costa Rica
Superior Sourcing, a wholly owned subsidiary of SUG Holding	Cayman Islands
BAMKO, LLC	Delaware
BAMKO Importação, Exportação e Comércio de Brindes Ltda.	Brazil
a subsidiary of BAMKO, LLC and SUG Holding
Worldwide Sourcing Solutions Limited	Hong Kong
a wholly owned subsidiary of BAMKO, LLC
Guangzhou Ben Gao Trading Limited	China
a wholly owned subsidiary of Worldwide Sourcing Solutions Limited
BAMKO India Private Limited	India
a 99%-owned subsidiary of BAMKO, LLC
BAMKO UK, Ltd.	United Kingdom
a wholly owned subsidiary of BAMKO, LLC

EX-23.1

EXHIBIT 23.1

Consent of Independent Registered Public Accounting Firm

We hereby consent to the incorporation by reference in this Annual Report on Form 10-K of Superior Uniform Group, Inc. and Subsidiaries for the year ended December 31, 2017, of our reports dated February 22, 2018, included in its Registration Statement on Forms S-8 (File No. 333-105906 and File No. 333-188944) related to the financial statements as of December 31, 2017 and December 31, 2016 and for the three-year period ended December 31, 2017, and internal controls for the year ended December 31, 2017.

/s/ Mayer Hoffman McCann P.C.

Clearwater, Florida

February 22, 2018

EX-31.1

EXHIBIT 31.1

CERTIFICATIONS

I, Michael Benstock, certify that:

1. I have reviewed this annual report on Form 10-K of Superior Uniform Group, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; and
 

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; and

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5. The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
 

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 22, 2018

/s/ Michael Benstock

Michael Benstock

Chief Executive Officer

(Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

CERTIFICATIONS

I, Andrew D. Demott, Jr., certify that:

1. I have reviewed this annual report on Form 10-K of Superior Uniform Group, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; and

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; and

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting.

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 22, 2018

/s/ Andrew D. Demott, Jr.

Andrew D. Demott, Jr.

Chief Operating Officer, Chief Financial Officer and Treasurer

(Principal Financial

Officer and Principal Accounting Officer)

EX-32.1

EXHIBIT 32.1

Written Statement of the Chief Executive Officer
Pursuant to 18 U.S.C. Section 1350

Solely for the purposes of complying with 18 U.S.C. Section 1350, I, the undersigned Chief Executive Officer of Superior Uniform Group, Inc. (the “Company”), hereby certify, based on my knowledge, that the Annual Report on Form 10-K of the Company for the year ended December 31, 2017 (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 and that information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Michael Benstock

Michael Benstock

Chief Executive Officer

(Principal Executive Officer)

February 22, 2018

EX-32.2

EXHIBIT 32.2

Written Statement of the Chief Financial Officer
Pursuant to 18 U.S.C. Section 1350

Solely for the purposes of complying with 18 U.S.C. Section 1350, I, the undersigned Chief Operating Officer, Chief Financial Officer and Treasurer of Superior Uniform Group, Inc. (the “Company”), hereby certify, based on my knowledge, that the Annual Report on Form 10-K of the Company for the year ended December 31, 2017 (the “Report”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 and that information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Andrew D. Demott, Jr.

Andrew D. Demott, Jr.

Chief Operating Officer, Chief Financial Officer and Treasurer

(Principal Financial Officer and Principal Accounting Officer)

February 22, 2018

XML

Document And Entity Information - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Feb. 20, 2018	Jun. 30, 2017
Document Information [Line Items]
Entity Registrant Name	SUPERIOR UNIFORM GROUP INC
Entity Central Index Key	0000095574
Trading Symbol	sgc
Current Fiscal Year End Date	--12-31
Entity Filer Category	Accelerated Filer
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Well-known Seasoned Issuer	No
Entity Common Stock, Shares Outstanding (in shares)		15,134,611
Entity Public Float			$ 228.3
Document Type	10-K
Document Period End Date	Dec. 31, 2017
Document Fiscal Year Focus	2017
Document Fiscal Period Focus	FY
Amendment Flag	false

XML

Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Net sales	$ 266,814	$ 252,596	$ 210,317
Costs and expenses:
Cost of goods sold	170,462	165,614	138,884
Selling and administrative expenses	71,816	66,396	52,018
Interest expense	802	688	519
	243,080	232,698	191,421
Gain on sale of property, plant and equipment	1,048
Income before taxes on income	24,782	19,898	18,896
Income tax expense	9,760	5,260	5,830
Net income	$ 15,022	$ 14,638	$ 13,066
Weighted average number of shares outstanding during the period
(Basic) (in shares)	14,510,156	14,082,243	13,761,009
(Diluted) (in shares)	15,118,768	14,897,489	14,578,644
Basic
Net earnings (in dollars per share)	$ 1.04	$ 1.04	$ 0.95
Diluted
Net earnings (in dollars per share)	$ 0.99	$ 0.98	$ 0.90
Other comprehensive income (loss), net of tax:
Recognition of net losses included in net periodic pension costs	$ 652	$ 667	$ 499
Recognition of settlement loss included in net periodic pension costs	272	287	297
Current period loss	(1,948)	(764)	(1,410)
(Loss) gain on cash flow hedging activities	(111)	95	37
Foreign Currency Translation Adjustment:
Reclassification of gain on foreign currency transactions included in net income		(170)
Foreign currency translation adjustments	20	243
Other comprehensive (loss) income	(1,115)	358	(577)
Comprehensive income	$ 13,907	$ 14,996	$ 12,489
Cash dividends per common share (in dollars per share)	$ 0.365	$ 0.34	$ 0.315

XML

Consolidated Balance Sheets - USD ($) $ in Thousands		Dec. 31, 2017	Dec. 31, 2016
CURRENT ASSETS:
Cash and cash equivalents		$ 8,130	$ 3,649
Accounts receivable, less allowance for doubtful accounts of $1,382 and $1,276, respectively		50,569	41,823
Accounts receivable - other		1,848	3,085
Inventories	[1]	64,979	69,240
Prepaid expenses and other current assets		11,011	7,214
TOTAL CURRENT ASSETS		136,537	125,011
PROPERTY, PLANT AND EQUIPMENT, NET		26,844	27,533
OTHER INTANGIBLE ASSETS, NET		29,061	23,238
GOODWILL		16,032	11,269
DEFERRED INCOME TAXES		2,900	6,800
OTHER ASSETS		7,564	2,997
		218,938	196,848
CURRENT LIABILITIES:
Accounts payable		19,752	13,507
Other current liabilities		12,409	10,716
Current portion of long-term debt		6,000	5,893
Current portion of acquisition-related contigent liability		3,061	1,788
TOTAL CURRENT LIABILITIES		41,222	31,904
LONG-TERM DEBT		32,933	36,227
LONG-TERM PENSION LIABILITY		8,319	9,467
LONG-TERM ACQUISITION-RELATED CONTINGENT LIABILITY		7,283	7,238
OTHER LONG-TERM LIABILITIES		4,213	1,462
COMMITMENTS AND CONTINGENCIES (NOTE 11)
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 - 15,081,947 and 14,513,207, respectively.		15	15
Additional paid-in capital		49,103	42,416
Retained earnings		83,129	74,283
Accumulated other comprehensive income (loss), net of tax:
Pensions		(7,282)	(6,258)
Cash flow hedges		(90)	21
Foreign Currency Translation Adjustment		93	73
TOTAL SHAREHOLDERS' EQUITY		124,968	110,550
		$ 218,938	$ 196,848

[1] Inventories consist of the following: September 30, 2017 December 31, (Unaudited) 2016 Finished goods $ 54,904,000 $ 57,887,000 Work in process 690,000 853,000 Raw materials 10,366,000 10,500,000

XML

Consolidated Balance Sheets (Parentheticals) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Accounts receivable, allowance for doubtful accounts	$ 1,382	$ 1,276
Preferred stock, par value (in dollars per share)	$ 0.001	$ 0.001
Preferred stock, shares authorized (in shares)	300,000	300,000
Preferred stock, shares issued (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.001	$ 0.001
Common stock, shares authorized (in shares)	50,000,000	50,000,000
Common stock, shares issued (in shares)	15,081,947	14,513,207
Common stock, shares outstanding (in shares)	15,081,947	14,513,207

XML

Consolidated Statements of Shareholders' Equity - USD ($) $ in Thousands	Employee Stock Option [Member] Common Stock [Member]	Employee Stock Option [Member] Additional Paid-in Capital [Member]	Employee Stock Option [Member] Retained Earnings [Member]	Employee Stock Option [Member] AOCI Attributable to Parent [Member]	Employee Stock Option [Member]	Stock Appreciation Rights (SARs) [Member] Common Stock [Member]	Stock Appreciation Rights (SARs) [Member] Additional Paid-in Capital [Member]	Stock Appreciation Rights (SARs) [Member] Retained Earnings [Member]	Stock Appreciation Rights (SARs) [Member] AOCI Attributable to Parent [Member]	Stock Appreciation Rights (SARs) [Member]	Restricted Stock [Member] Common Stock [Member]	Restricted Stock [Member] Additional Paid-in Capital [Member]	Restricted Stock [Member] Retained Earnings [Member]	Restricted Stock [Member] AOCI Attributable to Parent [Member]	Restricted Stock [Member]	Common Stock [Member]	Additional Paid-in Capital [Member]	Retained Earnings [Member]	AOCI Attributable to Parent [Member]	Total
Balance (in shares) at Dec. 31, 2014																13,514,566
Balance at Dec. 31, 2014																$ 13	$ 29,501	$ 56,843	$ (5,945)	$ 80,412
Common shares issued upon exercise of options, net (in shares)					50,224											294,659
Common shares issued upon exercise of options, net																$ 1	2,101	(262)		1,840
Restricted shares issued (in shares)																8,326
Restricted shares issued																	282			282
Common shares issued upon exercise of Stock Appreciation Rights (SARs) (in shares)																99,914
Share-based compensation expense																	1,079			1,079
Excess tax benefit from exercies of stock options		$ 618			$ 618		$ 225			$ 225
Cash dividends declared																		(4,255)		(4,255)
Net income																		13,066		13,066
(Loss) gain on cash flow hedging activities																			37	37
Pensions, net of taxes																			(614)	(614)
Comprehensive Income:																				$ 12,489
Purchase and retirement of common shares (in shares)																				0
Balance (in shares) at Dec. 31, 2015																13,917,465
Balance at Dec. 31, 2015																$ 14	33,806	65,392	(6,522)	$ 92,690
Common shares issued upon exercise of options, net (in shares)					81,608											251,996				279,766
Common shares issued upon exercise of options, net																$ 1	1,960	(457)		$ 1,504
Restricted shares issued (in shares)																333,190
Restricted shares issued																	4,558			4,558
Common shares issued upon exercise of Stock Appreciation Rights (SARs) (in shares)																55,656
Share-based compensation expense																	1,638			1,638
Cash dividends declared																		(4,707)		(4,707)
Net income																		14,638		14,638
(Loss) gain on cash flow hedging activities																			95	95
Pensions, net of taxes																			190	190
Comprehensive Income:																				$ 14,996
Tax withheld on exercise of Stock Appreciation Rights (SARs)							(405)			(405)
Tax benefit from vesting of acquisition related restricted stock												$ 990			$ 990
Purchase and retirement of common shares (in shares)																(45,100)				(45,100)
Purchase and retirement of common shares																	(131)	(583)		$ (714)
Change in currency translation adjustment, net of taxes																			73	$ 73
Balance (in shares) at Dec. 31, 2016																14,513,207				14,513,207
Balance at Dec. 31, 2016																$ 15	42,416	74,283	(6,164)	$ 110,550
Common shares issued upon exercise of options, net (in shares)					144,443											285,745				336,726
Common shares issued upon exercise of options, net																	2,779	(907)		$ 1,872
Restricted shares issued (in shares)																181,399
Restricted shares issued																	2,780			2,780
Common shares issued upon exercise of Stock Appreciation Rights (SARs) (in shares)																101,596
Share-based compensation expense																	1,664			1,664
Cash dividends declared																		(5,269)		(5,269)
Net income																		15,022		15,022
(Loss) gain on cash flow hedging activities																			(111)	(111)
Pensions, net of taxes																			(1,024)	(1,024)
Comprehensive Income:																				$ 13,907
Tax withheld on exercise of Stock Appreciation Rights (SARs)							$ (1,186)			$ (1,186)
Tax benefit from vesting of acquisition related restricted stock												$ 650			$ 650
Purchase and retirement of common shares (in shares)																				0
Change in currency translation adjustment, net of taxes																			20	$ 20
Balance (in shares) at Dec. 31, 2017																15,081,947				15,081,947
Balance at Dec. 31, 2017																$ 15	$ 49,103	$ 83,129	$ (7,279)	$ 124,968

XML

Consolidated Statements of Shareholders' Equity (Parentheticals) - USD ($)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Retained Earnings [Member]
Cash dividends declared, per share (in dollars per share)	$ 0.365	$ 0.034	$ 0.0315
AOCI Attributable to Parent [Member]
Cash flow hedges, tax	$ 36,000		$ 20,000
Pensions, taxes	59,000		$ 339,000
Change in currency translation adjustment, taxes	$ 13,000
Cash flow hedges, tax		$ 24,000
Pensions, taxes		97
Change in currency translation adjustment, taxes		$ 41,000

XML

Consolidated Statements of Cash Flows - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$ 15,022	$ 14,638	$ 13,066
Adjustments to reconcile net income to net cash provided from operating activities:
Depreciation and amortization	5,653	4,935	3,873
Provision for bad debts - accounts receivable	1,002	512	266
Share-based compensation expense	1,664	1,638	1,361
Deferred income tax provision (benefit)	5,114	(1,940)	(1,216)
Gain on foreign currency transactions		(264)
Gain on disposals of property, plant and equipment	(1,048)		(1)
Adjustment to acquisition-related contingent liability	(250)	(200)	(200)
Accretion of acquisition-related contingent liability	161	169	119
Excess tax benefit from exercise of stock options and SARS			1,575
Changes in assets and liabilities, net of acquisition of businesses:
Accounts receivable - trade	(4,731)	(7,244)	(2,224)
Accounts receivable - other	1,237	177	873
Inventories	4,250	(5,427)	(5,291)
Prepaid expenses and other current assets	(4,151)	2,203	(1,717)
Other assets	(4,504)	(1,029)	(1,817)
Accounts payable	3,291	87	2,069
Other current liabilities	71	1,943	(631)
Long-term pension liability	(2,577)	829	(112)
Other long-term liabilities	2,523	962	(80)
Net cash provided from operating activities	22,727	11,989	9,913
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property, plant and equipment	(4,248)	(7,385)	(8,069)
Proceeds from disposals of property, plant and equipment	2,858		24
Acquisition of businesses, net of acquired cash	(7,988)	(15,161)
Net cash used in investing activities	(9,378)	(22,546)	(8,045)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long-term debt	74,387	125,067	67,345
Repayment of long-term debt	(77,573)	(106,827)	(68,416)
Payment of cash dividends	(5,269)	(4,707)	(4,255)
Payment of acquisition-related contingent liability	(1,800)	(1,800)	(1,200)
Proceeds received on exercise of stock options	1,872	1,504	1,840
Tax withholdings on exercise of stock rights	(1,186)	(405)	(732)
Common stock reqcquired and retired		(714)
Net cash (used in) provided from financing activities	(8,919)	13,108	(5,418)
Effect of exchange rates on cash	51	62
Net increase (decrease) in cash and cash equivalents	4,481	2,613	(3,550)
Cash and cash equivalents balance, beginning of year	3,649	1,036	4,586
Cash and cash equivalents balance, end of year	8,130	3,649	1,036
Restricted Stock [Member]
CASH FLOWS FROM FINANCING ACTIVITIES
Tax benefit from vesting of acquisition related restricted stock	$ 650	$ 990

XML

Note 1 - Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Significant Accounting Policies [Text Block]

NOTE

1

– Summary of Significant Accounting Policies:

a) Business description

Superior

’s Uniforms and Related Products segment, through its signature marketing brands Fashion Seal Healthcare

®

,

HPI Direct

®

, Superior I.D.™, Worklon

®

, and UniVogue

®

,

manufactures and sells a wide range of uniforms, corporate identity apparel, career apparel and accessories for the hospital and healthcare fields; hotels; fast food and other restaurants; transportation; and the private security, industrial and commercial markets. In excess of

95%

of Superior’s Uniforms and Related Products segment’s net sales are from the sale of uniforms and service apparel and directly-related products.

S

uperior services its Remote Staffing Solutions segment through multiple The Office Gurus entities, including its direct and indirect subsidiaries in El Salvador, Belize, and the United States, (collectively, “TOG”). TOG is a near-shore premium provider of cost effective multilingual telemarketing and total office support solutions.

The Promotional Products segment

, through the BAMKO, Public Identity and Tangerine brands, services customers that purchase primarily promotional and related products. The segment currently has sales offices in the United States and Brazil with support services in China, Hong Kong and India.

b) Basis of presentation

The consolidated financial statements include the accounts of Superior Uniform Group, Inc. and its wholly-owned subsidiaries, The

Office Gurus, LLC, SUG Holding, Fashion Seal Corporation, and BAMKO, LLC; The Office Gurus, Ltda, de C.V., The Office Masters, Ltda., de C.V. and The Office Gurus, Ltd., each a subsidiary of Fashion Seal Corporation and SUG Holding; and Power Three Web, Ltda. and Superior Sourcing, each a wholly-owned subsidiary of SUG Holding; BAMKO Importação, Exportação e Comércio

de Brindes Ltda., a subsidiary of BAMKO, LLC and SUG Holding; Guangzhou Ben Gao Trading Limited, Worldwide Sourcing Solutions Limited, and BAMKO UK, Limited, each a direct or indirect subsidiary of BAMKO, LLC, and BAMKO India Private Limited, a

99%

-owned subsidiary of BAMKO, LLC. All of these entities are referred to collectively as “the Company”. Intercompany items have been eliminated in consolidation.

c) Cash and cash equivalents

The Company considers all highly liquid investments with an original maturity of

three

months or less at the time of purchase to be cash equivalents.

d)

Revenue recognition and allowance for doubtful accounts

The Company recognizes revenue as products are shipped and title passes

and as services are provided.

The Company collects sales tax for various taxing authorities. It is the Company’s policy to record these amounts on a net basis. Therefore, these amounts are

not

included in net sales for the Company. A provision for estimated returns and allowances is recorded based upon historical experience and current allowance programs. Judgments and estimates are used in determining the collectability of accounts receivable. The Company analyzes specific accounts receivable and historical bad debt experience, customer credit worthiness, current economic trends and the age of outstanding balances when evaluating the adequacy of the allowance for doubtful accounts. Management judgments and estimates are used in connection with establishing the allowance in any accounting period. Changes in estimates are reflected in the period they become known. Charge-offs of accounts receivable are made once all collection efforts have been exhausted. If the financial condition of the Company's customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances

may

be required.

e)

     Accounts receivable-other

The Company purchases raw materials and has them delivered to certain suppliers of the Company. The Company pays for the raw materials and then deducts the cost of these materials from payments to the suppliers at the time the related finished goods are invoiced to the Company by those suppliers.

f

) Advertising expenses

The Company expenses advertising costs as incurred. Advertising costs for

each of the years ended

December 31, 2017,

2016

and

2015,

respectively, were

$

0.1

million.

g

) Cost of goods sold and shipping and handling fees and costs  

Cost of goods sold consists primarily of direct costs of acquiring inventory, including cost of merchandise, inbound freight charges, purchasing

, receiving and inspection costs, for our Uniforms and Related Products segment and our Promotional Products segment. Cost of goods sold for our Remote Staffing Solutions segment includes salaries and payroll related benefits for agents. The Company includes shipping and handling fees billed to customers in net sales. Shipping and handling costs associated with out-bound freight are generally recorded in cost of goods sold. Other shipping and handling costs are included in selling and administrative expenses and totaled

$10.9

million,

$10.6

million and

$9.3

million for the years ended

December 31, 2017,

2016

and

2015,

respectively.

h

) Inventories

Inventories are stated at the lower of cost (

first

-in,

first

-out method) or market value. Judgments and estimates are used in determining the likelihood that goods on hand can be sold to customers. Historical inventory usage and current revenue trends are considered in estimating both excess and obsolete inventories. If actual product demand and market conditions are less favorable than those projected by management, additional inventory write-downs

may

be required.

i

) Property, plant and equipment

Property, plant and equipment are stated at cost

, less accumulated depreciation and amortization. Major renewals and improvements are capitalized, while replacements, maintenance and repairs which do

not

improve or extend the life of the respective assets are expensed on a current basis. Costs of assets sold or retired and the related accumulated depreciation and amortization are eliminated from accounts and the net gain or loss is reflected in the consolidated statements of comprehensive income within selling and administrative expenses.

j) 

Goodwill

Goodwill represents the excess of the cost of an acquisition over the fair value of the net assets acquired. The Company tests goodwill for impairment annually as of

December

31st

and/or when an event occurs or circumstances change such that it is more likely than

not

that impairment

may

exist. Examples of such events and circumstances that the Company would consider include the following:

• macroeconomic conditions such as deterioration in general economic conditions, limitations on accessing capital, or other developments in equity and credit markets;

• industry and market considerations such as a deterioration in the environment in which the Company operates, an increased competitive environment, a decline in market-dependent multiples or metrics (considered in both absolute terms and relative to peers), a change in the market for the Company's products or services, or a regulatory or political development;

• cost factors such as increases in raw materials, labor, or other costs that have a negative effect on earnings and cash flows;

• overall financial performance such as negative or declining cash flows or a decline in actual or planned revenue or earnings compared with actual and projected results of relevant prior periods;

• other relevant entity-specific events such as changes in management, key pe rsonnel, strategy, or customers. 

Goodwill is tested at a level of reporting referred to as "the reporting unit." The

Company's reporting units are defined as each of its

three

reporting segments with its goodwill included in the Uniforms and Related Products segment of

$4.1

million and

$11.9

million in the Promotional Products segment.

An entity has the option to

first

assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than

not

(that is, a likelihood of more than

50%

) that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, an entity determines it is

not

more likely than

not

that the fair value of a reporting unit is less than its carrying amount, then performing the impairment test is unnecessary. The Company completed its assessment of the qualitative factors as of

December 31,

201

7

and determined that it was

not

more likely than

not

that the fair value of the reporting unit was less than its carrying value.

k

) Other intangible assets

Other intangible assets consist

of customer relationships, a non-compete agreement and trade names acquired in previous business acquisitions.

The cost, amortization and net value of customer relationships and non-compete agreement as of

December 31, 2017

and

2016

were as follows (In thousands):

	Customer Relationships			Weighted Average Life (years)		Non-Compete Agreemen t			Weighted Average Life (years )		Customer Backlo g			Weighted Average Life (years )
December 31, 201 7
Cos t	$	15,530			8.8	$	5,551			5.1	$	122			0.5
Accumulated amortizatio n		(4,782	)				(4,619	)				(10	)
Ne t	$	10,748				$	932				$	112
December 31, 201 6
Cos t	$	12,311			9.4	$	5,370			5.1	$	0			N/A
Accumulated amortizatio n		(4,490	)				(3,553	)				0
Ne t	$	7,821				$	1,817				$	0

Amortization expense for other intangible assets was

$2.4

million,

$2.3

million and

$2.1

million for the years ended

December 31, 2017,

2016

and

2015,

respectively.

  Amortization expense for other intangible assets is expected to be

$2.5

million in

2018;

$

1.9

million in each of the years ending

December 31, 2019

through

2021;

$1.8

million in

2022;

$1.1

million in

2023

and

$0.5

million in

2024.

As part of the acquisition of HPI in

2013,

the Company recorded

$4.7

million as the fair value of the acquired trade name in other intangible assets. This asset is considered to have an indefinite life and as such is

not

being amortized.

As part of the acquisition of BAMKO in

2016,

the Company recorded

$8.9

million as the fair value of the acquired trade name in other intangible assets. This asset is considered to have an indefinite life and as such is

not

being amortized.

As part of the acquisitions of Public Identity and Tangerine in

2017,

the Company recorded

$0.5

million and

$3.2

million, respectively as the fair value of the acquired trade names in other intangible assets. These amounts are considered to have an indefinite life and as such are

not

being amortized.

l

) Depreciation and amortization

Plant and equipment are depreciated

on the straight-line basis at

2.5%

to

5%

for buildings,

2.5%

to

20%

for improvements,

10%

to

33.33%

for machinery, equipment and fixtures and

20%

to

33.33%

for transportation equipment. Leasehold improvements are amortized over the terms of the leases inasmuch as such improvements have useful lives of at least the terms of the respective leases.

m

) Employee benefits

Pension plan costs are funded currently based on actuarial estimates, with prior service costs amortized over

20

years. The Company recognizes settlement gains and losses in its

consolidated financial statements when the cost of all settlements in a year is greater than the sum of the service cost and interest cost components of net periodic pension cost for the plan for the year.

n

) Insurance

The Company self-insures for certain

obligations related to employee health programs. The Company also purchases stop-loss insurance policies to protect it from catastrophic losses. Judgments and estimates are used in determining the potential value associated with reported claims and for losses that have occurred, but have

not

been reported. The Company's estimates consider historical claim experience and other factors. The Company's liabilities are based on estimates, and, while the Company believes that the accrual for loss is adequate, the ultimate liability

may

be in excess of or less than the amounts recorded. Changes in claim experience, the Company's ability to settle claims or other estimates and judgments used by management could have a material impact on the amount and timing of expense for any period.

o

) Taxes on income

Income taxes are provided for under the liability method, whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than

not

that some portion or all of the deferred tax assets will

not

be realized.

Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The calculation of the Company’s tax liabilities also involves dealing with uncertainties in the application of complex tax regulations. The Company recognizes liabilities for uncertain income tax positions based on estimates of whether, and the extent to which, additional taxes will be required. The Company also reports interest and penalties related to uncertain income tax positions as income taxes. Refer to Note

7.

p

) Impairment of long-lived assets

L

ong-lived assets, such as property and equipment, and purchased intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset

may

not

be recoverable. Recoverability of the asset is measured by comparison of its carrying amount to future net cash flows the asset is expected to generate. If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the asset exceeds its fair value. There was

no

impairment of long-lived assets for the years ended

December 31, 2017,

2016,

and

2015.

q

) Share-based compensation

The Company awards share-based compensation as an incentive for employees to contribute to the Company

’s long-term success. Historically, the Company has granted options, stock-settled stock appreciation rights, and restricted stock. In

2016,

the Company began issuing performance shares as well. At

December 31, 2017,

the Company had

3,667,577

shares of common stock available for grant of awards of share-based compensation under its

2013

Incentive Stock and Awards Plan.

T

he Company recognizes share-based compensation expense for all awards granted to employees, which is based on the fair value of the award on the date of grant. Determining the appropriate fair value model and calculating the fair value of stock compensation awards requires the input of certain highly complex and subjective assumptions, including the expected life of the stock compensation awards and the Company’s common stock price volatility, risk free interest rate and dividend rate. The assumptions used in calculating the fair value of stock compensation awards represent management’s best estimates, but these estimates involve inherent uncertainties and the application of judgment. As a result, if factors change and the Company deems it necessary to use different assumptions, stock compensation expense could be materially different from what has been recorded in the current period.

r

) Earnings per share

Historical basic per share data is based on the weighted average number of shares outstanding.

Historical diluted per share data is reconciled by adding to weighted average shares outstanding the dilutive impact of the exercise of outstanding stock options, stock-settled stock appreciation rights, and restricted stock.

s

) Comprehensive income

Other comprehensive income (loss) is defined as the change in equity during a period, from transactions and other events, excluding changes resulting from investments by owners (e.g., supplemental stock offering) and distributions to owners (e.g., dividends).

t

) Operating segments

The Financial Accounting Standards Board (“

FASB”) establishes standards for the way that public companies report information about operating segments in annual financial statements and establishes standards for related disclosures about product and services, geographic areas and major customers. The Company has reviewed the standard and determined that it has

three

reportable segments, Uniforms and Related Products, Remote Staffing Solutions and Promotional Products.

u

)  Risks and concentrations

Financial instruments that potentially subject the Company to concentrations of credit risk include cash in banks in excess of federally insured amounts.

  The Company manages this risk by maintaining all deposits in high quality financial institutions and periodically performing evaluations of the relative credit standing of the financial institutions.

When assessing credit risk the Company considers whether the credit risk exists at both the individual and group level. Consideration is given to the activity, region and economic characteristics when assessing if there exists a group concentration risk. At

December 31, 2017

and

2016,

the Company had

no

customers with an accounts receivable balance greater than

11.3

%

of the total accounts receivable. At

December 31, 2017

and

2016,

the top

five

accounts receivable customer balances totaled

$14.2

million and

$12.9

million, respectively, or approximately

28.0%

and

30.8%

of the respective total accounts receivable balances. The Company’s largest customer for each of the years ended

December 31, 2017,

2016,

and

2015

had net sales of approximately

$20.6

million,

$19.3

million and

$12.5

million, respectively, or approximately

7.7%,

7.6%

and

6.0%

of the respective total net sales for the Company. The Company’s

five

largest customers for the years ended

December 31, 2017,

2016

and

2015

had net sales of approximately

$50.7

million,

$57.6

million and

$48.9

million, respectively, or approximately

19.0%,

22.8%

and

23.3%

of the respective total net sales for the Company.   

Included in accounts receivable-other on the Company

’s consolidated balance sheets at

December 31, 2017

and

2016

are receivable balances from a supplier in Haiti totaling

$1.5

million and

$2.3

million, respectively.

In

201

7,

2016

and

2015,

approximately

28%,

31%

and

26%,

respectively, of our products for our Uniform and Related Products segment were sourced from or contained raw materials sourced from China. In

2017,

2016

and

2015,

approximately

32%,

32%

and

42%,

respectively, of our products for our Uniform and Related Products segment were obtained from suppliers located in Central America and Haiti. In

2017

and

2016,

approximately

67%

and

59%,

respectively, of our products for our Promotional Products segment were sourced from China. Any inability by the Company to continue to obtain its products from Central America and Haiti could significantly disrupt the Company’s business. Because the Company manufactures and sources products in Central America and Haiti, the Company is affected by economic conditions in those countries, including increased duties, possible employee turnover, labor unrest and lack of developed infrastructure.

v

) Fair value of financial instruments

The carrying amounts of cash and cash equivalents, receivables and accounts payable approximated f

air value as of

December 31, 2017

and

2016,

because of the relatively short maturities of these instruments. The carrying amount of the Company’s long-term debt approximated fair value as the rates are adjustable based upon current market conditions.

w) Stock Split

On

December 29, 2014,

the Board of Directors declared a

2

-for-

1

stock split of the Company

’s common stock. The record date of the split was

January 12, 2015,

and the stock split became effective

February 4, 2015.

All share and per share information in these consolidated interim financial statements have been restated for all periods presented, giving retroactive effect to the stock split. The Company revised certain historical amounts when it recorded the

2

-for-

1

stock split. The amounts were immaterial and reclassified within shareholders’ equity between par value and additional paid in capital.

x

) Use of estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates.

y) Recent Accounting Pronouncements

In

May 2014,

the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)

No.

2014

-

09,

Revenue from Contracts with Customers (Topic

606

) that will supersede most current revenue recognition guidance, including industry-specific guidance. The core principle of the new guidance is that an entity will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard provides a

five

-step analysis of transactions to determine when and how revenue is recognized. Other major provisions include the capitalization and amortization of certain contract costs, ensuring the time value of money is considered in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. Additionally, the guidance requires disaggregated disclosures related to the nature, amount, timing, and uncertainty of revenue that is recognized. The amendments are required to be adopted by the Company on

January 1, 2018.

Transition to the new guidance

may

be done using either a full or modified retrospective method.

The Company will use the modified retrospective transition method with the cumulative effect recorded to the opening balance of retained earnings. The Company’s assessment of the new standard is substantially complete. The timing of revenue recognition is

not

expected to change for our Remote Staffing Solutions segment. For our Uniforms and Related Products and Promotional Products segments, our revenue is generated from the sale of finished products to customers as products are shipped and title passes to the customers. For certain contracts with customers, the Company creates an asset with

no

alternative use to the Company, and the Company has enforceable right to payment for performance completed to date. For these contracts, we expect to move from a point in time model for revenue recognition to an over time model. We expect this to have a material impact on the timing of our revenue recognition. As of

December 31, 2017

we estimate a net cumulative increase to retained earnings between

$10.0

million and

$15.0

million. We expect the new standard will have

no

cash impact and does

not

affect the economics our underlying customer contracts. We do

not

expect this new guidance to have any other material impacts on our Consolidated Financial Statements but will significantly expand our disclosures.

In

April 2015,

the FASB issued ASU

No.

2015

-

03

to simplify the presentation of debt issuance costs. The amendments in this ASU require debt issuance costs to be presented on the balance sheet as a reduction from the carrying amount of the related debt liability. The amendment in this ASU is to be applied retrospectively and is effective for interim and annual reporting periods beginning after

December 15, 2015.

The Company adopted this ASU retrospectively effective

January 1, 2016,

and has reclassified all debt issuance costs as a reduction from the carrying amount of the related debt liability for both the current and prior period. (See Note

6.

)

In

February 2016,

the FASB issued ASU

2016

-

02

that amends the accounting guidance on leases. The primary change in this ASU requires lessees to recognize, in the balance sheet, a liability to make lease payments and a right-of-use asset representing the right to use the underlying asset over the lease term. The amendments in this ASU are to be applied using a modified retrospective approach and are effective for fiscal years beginning after

December 15, 2018.

The Company is in the preliminary phases of assessing the effect of this ASU. We have

not

yet selected a transition date nor have we yet determined the effect of this ASU on our results of operations, financial condition, or cash flows.

In

March 2016,

the FASB issued ASU

2016

-

09,

“Compensation

– Stock Compensation (Topic

718

): Improvements to Employee Share-Based Payment Accounting”. This update was issued as part of FASB’s simplification initiative and affects all entities that issue share-based payment awards to their employees. The amendment requires that excess tax benefits for share-based payments be recorded as a reduction of income tax expense and reflected within operating cash flows rather than being recorded in paid-in-capital and reflected within financing cash flows. The standard also clarifies that all cash payments when directly withholding shares for tax-withholding purposes should be classified as a financing activity on the statement of cash flows and provides for an accounting policy election to account for forfeitures when they occur. The amendments in this update are effective for annual and interim periods beginning after

December 15, 2016.

Early adoption was permitted in any interim or annual period but must be reflected as of the beginning of the fiscal year. The Company elected to early adopt the standard in the

fourth

quarter of

2016

which required us to reflect the adjustments as of

January 1, 2016.

The recognition of excess tax benefits in our provision for income taxes rather than paid-in-capital resulted in an income tax benefit of for the years ended

December 31, 2017

and

December 31, 2016

of

$1.8

million or

$0.12

per share and

$0.9

million or

$0.06

per share, respectively. Lastly, the company has made an accounting policy election to account for forfeitures in compensation cost when they occur. There was

no

material impact of this election in fiscal

2017.

XML

Note 2 - Allowance for Doubtful Accounts Receivable

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

NOTE

2

- Allowance for Doubtful Accounts Receivable

:

The activity in the allowance for doubtful accounts receivable was as follows (in thousands)

:

	201 7			201 6			201 5
Balance at the beginning of yea r	$	1,276		$	848		$	680
Provision for bad debt s		1,002			523			266
Charge-off s		(901	)		(96	)		(98	)
Recoverie s		5			1			-
Balance at the end of yea r	$	1,382		$	1,276		$	848

XML

Note 3 - Reserve for Sales Returns and Allowance

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Reserve For Sales Returns And Allowances Disclosure [Text Block]

NOTE

3

- Reserve for Sales Returns and Allowances

:

The activity in the reserve for sales returns and allowances was as follows (in thousands)

:

	201 7			201 6			201 5
Balance at the beginning of yea r	$	1,967		$	1,384		$	1,308
Provision for returns and allowance s		2,789			4,445			4,547
Actual returns and allowances paid to customer s		(3,631	)		(3,862	)		(4,471	)
Balance at the end of yea r	$	1,125		$	1,967		$	1,384

XML

Note 4 - Inventories

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Inventory Disclosure [Text Block]

NOTE

4

- Inventories

:

(In thousands)

	December 31 ,
	201 7		201 6
Finished good s	$	54,354	$	57,887
Work in proces s		604		853
Raw material s		10,021		10,500
	$	64,979	$	69,240

XML

Note 5 - Property, Plant and Equipment

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Property, Plant and Equipment Disclosure [Text Block]

NOTE

5

- Property, Plant and Equipment

:

(In thousands

)

	December 31 ,
	201 7			201 6
Lan d	$	3,635		$	4,485
Buildings, improvements and leasehold s		18,192			19,140
Machinery, equipment and fixture s		52,594			48,840
		74,421			72,465
Accumulated depreciation and amortizatio n		(47,577	)		(44,932	)
	$	26,844		$	27,533

Depreciation and amortization charges were approximately

$3.3

million,

$2.6

million and

$1.8

million in

2017,

2016,

and

2015

respectively

.

XML

Note 6 - Long-term Debt

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Long-term Debt [Text Block]

NOTE

6

- Long-Term Debt

:

(In thousands )	December 31 ,		December 31 ,
	2017		2016
Term loan payable to Fifth Third Bank, pai d  February 28, 201 7	$	-	$	39,643
Note payable to Fifth Third Bank, pursuant to revolvin g credit agreement, paid February 28, 201 7	$	-	$	2,540
Note payable to BB&T, pursuant to revolvin g credit agreement, maturing February 25, 202 2	$	1,475	$	-
Term loan payable to BB& T maturing February 26, 202 4	$	37,500	$	-
	$	38,975	$	42,183
Less :
Payments due within one year include d in current liabilitie s	$	6,000	$	5,893
Debt issuance cost s	$	42	$	63
Long-term debt less current maturitie s	$	32,933	$	36,227

Effective

July 1, 2013,

t

he Company entered into an amended and restated

5

-year credit agreement with Fifth Third Bank that made available to the Company up to

$15.0

million on a revolving credit basis (the “Initial Credit Facility”) in addition to a

$30.0

million term loan utilized to finance the acquisition of substantially all of the assets of HPI Direct, Inc.

Effective

March 8, 2016,

the Company entered into an amended and restated

5

-year credit agreement with Fifth Third Bank (the “Amended Credit Agreement”) that increased its revolving credit facility from

$15

.0

million to

$20.0

million (the “Amended Credit Facility”) and refinanced its then-existing term loan with a new

$45.0

million term loan to help finance the acquisition of substantially all of the assets of BAMKO, Inc. Both loans were based upon the

one

-month LIBOR rate for U.S. dollar based borrowings. Interest was payable on the term loan at LIBOR plus

0.85%

and on the revolving credit facility at LIBOR (rounded up to the next

1/8

th

of

1%

) plus

0.85%.

The Company paid a commitment fee of

0.10%

per annum on the average unused portion of the commitment under the Amended Credit Facility. This credit agreement was paid in full on

February 28, 2017

with the proceeds from a new loan agreement with Branch Banking and Trust Company (“BB&T”).

Effective

February 28, 2017,

the Company entered into a new

7

-year credit agreement with BB&T (the “Credit Agreement”) that provides a new revolving credit facility of

$35

.0

million (the “Credit Facility”) which terminates on

February 25, 2022

and provides a new term loan of

$42.0

million (the “Term Loan”) which matures on

February 26, 2024.

Both loans are based upon the

one

-month LIBOR rate for U.S. dollar based borrowings. Interest is payable for each loan at LIBOR (rounded up to the next

1/100

th

of

1%

) plus

0.75%

(

2.25%

at

December 31, 2017).

The Company pays a commitment fee of

0.10%

per annum on the average unused portion of the commitment under the Credit Facility. The available balance under the Credit Facility is reduced by outstanding letters of credit. As of

December 31, 2017,

there were

no

amounts due under the Credit Facility and

no

outstanding letters of credit.

The remaining scheduled amortization fo

r the term loan is as follows:

2018

through

2023

$

6.0

million per year;

2024

$1.5

million. The term loan does

not

include a prepayment penalty. In connection with the Amended Credit Agreement, the Company incurred approximately

$0.1

million of debt issuance costs, which primarily consisted of legal fees. These costs are being amortized over the life of the Amended Credit Agreement and are recorded as additional interest expense.

The

Company’s obligations under the Amended Credit Agreement are secured by substantially all of the operating assets of Superior Uniform Group, Inc. and are guaranteed by all domestic subsidiaries of Superior Uniform Group, Inc. The agreement contains restrictive provisions concerning a maximum funded senior indebtedness to EBITDA ratio as defined in the agreement (

4.0:1

) as defined in the agreement and a fixed charge coverage ratio (

1.25:1

). The Company is in full compliance with all terms, conditions and covenants of the Amended Credit Agreement.

Effective

July 1, 2013,

in order to reduce interest rate risk on its debt, the Company entered into an interest rate swap agreement with Fifth Third Bank, N.A. that was designed to effectively convert or hedge the variable interest rate on a portion of it

s borrowings to achieve a net fixed rate of

2.53%

per annum, beginning

July 1, 2014

with a notional amount of

$14.3

million. The notional amount of the interest rate swap was reduced by the scheduled amortization of the principal balance of the original term loan of

$0.2

million per month through

July 1, 2015

and

$0.3

million per month through

June 1, 2018

with the remaining notional balance of

$3.3

million to be eliminated on

July 1, 2018. 

Effective

March 8, 2016,

the fixed rate on the notional amount was reduced to

2.43%.

  Effective

February 24, 2017,

this interest rate swap agreement was terminated. On this date the swap agreement had

$0.1

million in cumulative gains in OCI which was reversed to earnings.

Effective

March 3, 2017,

in order to reduce the

interest rate risk on its future debt, the Company entered into an interest rate swap agreement with BB&T that was designed to effectively convert or hedge the variable interest rate on a portion of its future borrowings to achieve a net fixed rate of

3.12%

per annum, beginning

March 1, 2018

with a notional amount of

$18.0

million.  The notional amount of the interest rate swap is reduced by

$0.3

million per month beginning

April 1, 2018

through

February 26, 2024. 

Under the terms of the interest rate swap, the Company will receive variable interest rate payments and make fixed interest rate payments on an amount equal to the notional amount at that time.  Changes in the fair value of the interest rate swap designated as the hedging instrument that effectively offset the variability of cash flows associated with the variable rate, long-term debt obligation are recorded in OCI, net of related income tax effects.  As of

December 31, 2017,

the swap agreement had a negative fair value of

$0.1

million which is presented within other current liabilities on the consolidated balance sheet. 

XML

Note 7 - Taxes on Income

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Income Tax Disclosure [Text Block]

NOTE

7

– Taxes on Income:

Aggregate income tax provisions consist of the following (in thousands):

	201 7		201 6			201 5
Current:
Federa l	$	2,846	$	5,642		$	6,527
Tax Cut and Jobs Ac t		265		-			-
State and loca l		647		628			519
Foreig n		338		-			-
		4,096		6,270			7,046
Long Term :
Tax Cut and Jobs Ac t		1,336		-			-
Deferred Taxes :
Deferred tax provision (benefit )		1,899		(1,010	)		(1,216	)
Tax Cut and Jobs Act re-measuremen t		2,429		-			-
		4,328		(1,010	)		(1,216	)
	$	9,760	$	5,260		$	5,830

The significant components of the deferred income tax asset (liability) are as follows (in thousands):

	2017			2016
Deferred income tax assets:
Pension accruals	$	2,606		$	3,581
Operating reserves and other accruals		2,174			3,656
Tax carrying value in excess of book basis of goodwill		866			1,377
Tax credits		255			99
Valuation allowance on tax credits		(255	)
Deferred income tax liabilities:
Book carrying value in excess of tax basis of property		(937	)		(827	)
Deferred expenses		(1,809	)		(1,086	)
Net deferred income tax asset	$	2,900		$	6,800

The difference between the total statutory Federal income tax rate and the actual effective income tax rate isaccounted for as follows:

	2017			2016			2015
Statutory Federal income tax rate		34.0	%		34.0	%		34.0	%
State and local income taxes, net of Federal income tax benefit		1.5			1.9			1.6
Effect of change in unrecognized tax benefit		-			-			(0.1	)
Current year untaxed foreign income		(6.5	)		(5.1	)		(6.0	)
Foreign Taxes		1.4			-			-
Non-deductible share-based employee compensation expense		1.1			1.2			1.3
Excess tax benefit from stock compensation		(7.2	)		(4.4	)		-
Federal tax credits		(0.5	)		(0.8	)		-
Tax Cut and Jobs Act deferred tax re-measurement		6.9			-			-
Tax on undistributed foreign earnings		2.9			-			-
Transition tax (repatriation)		5.9			-			-
Other items		(0.1	)		(0.4	)		0.1
Effective income tax rate		39.4	%		26.4	%		30.9	%

On

December 22, 2017,

the U.S. enacted the Tax Cuts and Jobs Act (“Tax Act”) that instituted fundamental changes to the U.S. tax system. The Tax Act includes changes to the taxation of foreign earnings by implementing a dividend exemption system, expansion of the current anti-deferral rules, a minimum tax on low-taxed foreign earnings and new measures to deter base erosion. The Tax Act also permanently reduces the corporate tax rate from

34%

to

21%,

imposes a

one

-time mandatory transition tax on the historical earnings of foreign affiliates and implements a territorial style tax system. In

2017,

income tax expense of

$9.8

million was unfavorably impacted by net discrete adjustments of

$4.0

million, due to a charge of

$3.3

million related to the enactment of the Tax Cut and Jobs Act (the “Tax Act”) in the United States and

$0.7

related to other miscellaneous discrete items.

Effective

January 1, 2018,

the Tax Act establishes a corporate income tax rate of

21%,

replacing the current

34%

rate, and creates a territorial tax system rather than a worldwide system, which generally eliminates the U.S. federal income tax on dividends from foreign subsidiaries. The transition to the territorial system includes a

one

-time transition tax on certain of our foreign earnings previously untaxed in the United States. Certain impacts of the new legislation would generally require accounting to be completed in the period of enactment, however, in response to the complexities of the new legislation, the Securities and Exchange Commission (“SEC”) issued guidance to provide companies with relief. Specifically, when the initial accounting for items under the new legislation is incomplete, the guidance allows us to include provisional amounts when reasonable estimates can be made. The SEC has provided up to a

one

-year measurement period for companies to finalize the accounting for the impacts of this new legislation and we anticipate finalizing our accounting over the coming quarters. While our accounting for the Tax Act is

not

complete, we have made reasonable estimates for certain provisions and we have recorded a net charge to tax expense of

$4.0

million related to its enactment. This net charge includes a deferred tax charge of

$1.7

million primarily from revaluing our net U.S. deferred tax assets to reflect the new U.S. corporate tax rate. We believe this calculation is complete except for changes in estimates that can result from finalizing the filing of our

2017

U.S. income tax return, which are

not

anticipated to be material, and changes that

may

be a direct impact of other provisional amounts recorded due to the enactment of the Tax Act.

In general, the

one

-time transition tax imposed by the Tax Act results in the taxation of our accumulated foreign earnings and profits (“E&P”) at a

15.5%

rate on liquid assets and

8%

on the remaining unremitted foreign E&P, both net of foreign tax credits. At this time, we have

not

yet gathered, prepared and analyzed the necessary information with respect to

2017

in sufficient detail to complete the complex calculations necessary to finalize the amount of our transition tax. We also anticipate that further guidance

may

become available in this and other areas. We believe that our preliminary calculations result in a reasonable estimate of the transition tax and related foreign tax credit and, as such have included an estimate of

$1.5

million in our year-end income tax provision. As the analysis of accumulated E&P and related foreign taxes paid are completed on an entity by entity basis and we finalize the amount held in cash or other specified assets, we will update our provisional estimate of the transition tax and related foreign tax credit. In addition, the Company

no

longer intends to permanently reinvest its historical foreign earnings and has recorded an additional deferred tax expense of

$0.7

million.

Only tax positions that m

eet the more-likely-than-

not

recognition threshold are recognized in the consolidated financial statements. As of

December 31, 2017

and

2016,

respectively, we have

$0.5

million of unrecognized tax benefits, all of which, if recognized, would favorably affect the annual effective income tax rate.  We do

not

expect any significant amount of this liability to be paid in the next

twelve

months. Accordingly, the balance of

$0.5

million is included in other long-term liabilities.

Changes in the Company

’s gross liability for unrecognized tax benefits, excluding interest and penalties, were as follows:

(In thousands )
	201 7			201 6
Balance at January 1,	$	399		$	399
Additions based on tax positions related to the current yea r		59			55
Additions for tax positions of prior year s		-			4
Reductions due to lapse of statute of limitation s		(58	)		(59	)
Balance at December 31 ,	$	400		$	399

W

e recognize interest and penalties accrued related to unrecognized tax benefits in the provision for income taxes. During each of the years

2017,

2016

and

2015,

we recorded

$

0.1

million for interest and penalties, net of tax benefits. During each of the years

2017,

2016

and

2015,

we reduced the liability

$

0.1

million for interest and penalties due to lapse of statute of limitations. At

December 31, 2017

and

2016,

we had

$

0.1

million accrued for interest and penalties, net of tax benefit.

We anticipate that it is reasonably possible that the total amount of unrecognized tax benefits cou

ld decrease by approximately

$0.1

million within the next

12

months due to the closure of tax years by expiration of the statute of limitations and audit settlements related to various state tax filing positions. The earliest year open to federal examinations is

2015

and significant state examinations is

2011.

XML

Note 8 - Benefit Plans

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Pension and Other Postretirement Benefits Disclosure [Text Block]

NOTE

8

– Benefit Plans:

Defined Benefit Plans

The Company is the sponsor of

two

noncontributory qualified defined benefit pension plans, providing for normal retirement at age

65,

covering all eligible employees (as defined). Periodic benefit payments on retirement are determined based on a fixed amount applied to service or determined as a percentage of earnings prior to retirement. The Company is also the sponsor of an unfunded supplemental executive retirement plan (SERP) in which several of its employees are participants. Pension plan assets for retirement benefits consist primarily of fixed income securities and common stock equities.

Effective

June 30, 2013,

the Company

no

longer accrues additional benefits for future service or for future increases in compensation levels for the company

’s primary defined benefit pension plan. 

Effective

December 31, 2014,

the Company

no

longer accrues additional benefits for future service for the Company

’s hourly defined benefit plan.

T

he Company recognizes the funded status of its defined benefit post retirement plans in the Company’s consolidated balance sheets.

At

December 31

,

2017,

the Company’s projected benefit obligation under its supplemental executive retirement pension plan exceeded the fair value of the plans’ assets by

$8.4

million and thus the plan is underfunded. The fair value of plan assets for the noncontributory qualified defined benefit pension plans exceeded their projected benefit obligations by

$2.2

million and thus the plans are overfunded.

It is our policy to make contributions to the various plans in accordance with statutory funding requirements and any additional funding that

may

be deemed appropriate.

T

he following tables present the changes in the benefit obligations and the various plan assets, the funded status of the plans, and the amounts recognized in the Company's consolidated balance sheetsat

December 

31,

2017

and

2016:

(In thousands )	December 31,
	201 7			201 6
Changes in benefit obligatio n
Benefit obligation at beginning of yea r	$	25,258		$	24,790
Service cos t		65			57
Interest cos t		965			988
Actuarial los s		3,755			1,288
Benefits pai d		(1,657	)		(1,865	)
Benefit obligation at end of yea r		28,386			25,258
Changes in plan asset s
Fair value of plan assets at beginning of yea r		15,791			15,865
Actual return on asset s		2,413			1,291
Employer contribution s		5,598			500
Benefits pai d		(1,657	)		(1,865	)
Fair value of plan assets at end of yea r		22,145			15,791
Funded status at end of yea r	$	(6,241	)	$	(9,467	)
Amounts recognized in consolidated balance sheet
Other asset s	$	2,181		$	-
Other current liabilitie s		(103	)		-
Long-term pension liabilit y		(8,319	)		(9,467	)
		(6,241	)		(9,467	)
Amounts recognized in accumulated other comprehensive income consist of :
Net actuarial los s	$	10,903		$	9,819

Information for pension plans with projecte

d

 benefit obligation in excess of plan asset

s

	December 31 ,
	201 7			201 6
Projected benefit obligatio n	$	28,386		$	25,258
Fair value of plan asset s		(22,145	)		(15,791	)
	$	6,241		$	9,467

Components of net periodic benefit cost

	201 7			201 6			201 5
Service cost - benefits earned during the perio d	$	65		$	57		$	48
Interest cost on projected benefit obligatio n		965			988			951
Expected return on plan asset s		(1,218	)		(1,188	)		(1,343	)
Recognized actuarial los s		1,042			1,027			772
Settlement los s		435			445			460
Net periodic pension cost after settlement s	$	1,289		$	1,329		$	888

The pension settlement loss

es included in the table above relates to lump sum payments made to various employees upon their retirement or termination each year.

The estimated net actuarial loss for the defined benefit pension plans that will be amortized from accumulated other comprehensive income into net periodic benefit cost over the next

fiscal year is

$1.1

million.

The table below presents various assumptions used in determining the benefit obligation for each year and reflects the percentages for the various plans.

W

eighted-average assumptions used to determine benefit obligations at

December 31,

							Long Term Rat e
	Discount Rate						of Retur n						Salary Scale
	Corp.			Plants			Corp.			Plants			Corp.		Plants
2016		4.04	%		3.91	%		8.00	%		8.00	%		N/A		N/A
2017		3.53	%		3.45	%		8.00	%		8.00	%		N/A		N/A

Weighted-average assumptions used to determine net periodic benefit cost for years ending

December 31,

							Long Term Rate
	Discount Rate						of Retur n						Salary Scale
	Corp.			Plants			Corp.			Plant s			Corp.		Plants
2015		3.86	%		3.74	%		8.00	%		8.00	%		N/A		N/A
2016		4.19	%		4.09	%		8.00	%		8.00	%		N/A		N/A
2017		4.04	%		3.91	%		8.00	%		8.00	%		N/A		N/A

The methodology used to determine the expected rate of return on the pension plan assets was based on

a review of actual returns in the past and consideration of projected returns based upon our projected asset allocation. Our strategy with respect to our investments in pension plan assets is to be invested with a long-term outlook. Therefore, the risk and return balance of our asset portfolio should reflect a long-term horizon. Our pension plan asset allocation at

December 

31,

2017,

2016

and target allocation for

2018

are as follows:

	Percentage of Plan Assets at December 31,						Target Allocation
Investment description	201 7			201 6			201 8
Equity securities		52	%		68	%		52	%
Fixed income		29	%		13	%		29	%
Other		19	%		19	%		19	%
Total		100	%		100	%		100	%

The Company

plans to contribute

$0.1

million to our defined benefit pension plans in

2018.

The following table includes projected benefit payments for the years indicated:

Year	Projected Benefit Payments
	(in thousands)
2018	$	1,467
2019	$	1,652
2020	$	2,135
2021	$	1,947
2022	$	1,979
202 3-2027	$	8,620

Rabbi Trust

In connection with the Company

’s unfunded SERP, we have life insurance contracts on the lives of designated individuals. The insurance contracts associated with the SERP are held in a Rabbi trust.

The trust is the owner and beneficiary of such insurance contracts. The policies are being utilized to help offset the costs and liabilities of the SERP. The cash surrender value of the life

insurance contracts was

$2.2

million at

December 31, 2017.

We recognized an investment gain on the cash surrender value of these life insurance contracts of

$0.3

million in

2017.

  The cash surrender value of these policies is included in other assets in the Consolidated Balance Sheets as of

December 31, 2017

and

2016.

In

2013

we initiated a Non-Qualified Deferred Compensation Plan, and we have purchased life insurance contracts on the lives of designated individuals during

2017.

The insurance contracts associated with the Non-Qualified Deferred Compensation Plan are also held in a Rabbi trust. The trust is the owner and beneficiary of such insurance contracts. The policies are being utilized to help offset the costs and liabilities of the Non-Qualified Deferred Compensation Plan. The cash surrender value of the life insurance contracts was

$2.2

million at

December 31, 2017.

The cash surrender value of these policies is included in other assets in the Consolidated Balance Sheet as of

December 31, 2017.

The liability for participant deferrals of

$2.2

million is included in other long-term liabilities in the Consolidated Balance Sheet as of

December 31, 2017.

Defined Contribution Plan

The Company provides a defined contribution plan covering qualified employees. The plan includes a provision that allows employees to make pre-tax contributions under Section

401

(k) of the Internal Revenue Code. The plan provides for the Company to make a guaranteed match equal to

25%

of each employee

’s eligible contributions. The plan also provides the Company with the option of making an additional discretionary contribution to the plan each year. Currently the discretionary contribution is set at

3%

of eligible employees’ payroll. The Company contributions for the years ended

December 31, 2017,

2016

and

2015

were approximately

$1.0

million,

$1.1

million and

$0.9

million, respectively.

XML

Note 9 - Quarterly Results for 2015, 2016 and 2017 (Unaudited)

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Quarterly Financial Information [Text Block]

NOTE

9

– Quarterly Results for

2015

2016

and

2017

(Unaudited)

:

(In thousands, except shares and per share data

)

	Quarter Ende d
	March 31 ,		June 30 ,		September 30 ,		December 31 ,
	201 7		201 7		201 7		201 7
Net sale s	$	60,987	$	65,604	$	67,773	$	72,450
Gross profi t	$	22,214	$	23,374	$	24,789	$	25,975
Income before taxes on incom e	$	5,405	$	5,701	$	6,842	$	6,834
Net incom e	$	3,835	$	4,341	$	4,962	$	1,884
Per Share Data :
Basi c
Net earnings	$	0.27	$	0.30	$	0.34	$	0.13
Dilute d
Net earnings	$	0.26	$	0.29	$	0.33	$	0.12
Average Outstanding Shares (Basic )		14,350,721		14,501,399		14,573,813		14,614,691
Average Outstanding Shares (Diluted )		14,929,695		15,040,431		15,229,722		15,275,222

	Quarter Ende d
	March 31 ,		June 30 ,		September 30 ,		December 31 ,
	201 6		201 6		201 6		201 6
	(restated )		(restated )		(restated )
Net sale s	$	57,968	$	64,660	$	65,282	$	64,686
Gross profi t	$	20,021	$	21,763	$	23,140	$	22,058
Income before taxes on incom e	$	3,410	$	4,615	$	6,006	$	5,867
Net incom e	$	2,442	$	3,308	$	4,447	$	4,441
Per Share Data :
Basi c
Net earnings	$	0.18	$	0.23	$	0.31	$	0.31
Dilute d
Net earnings	$	0.17	$	0.22	$	0.30	$	0.30
Average Outstanding Shares (Basic )		13,927,063		14,120,617		14,118,354		14,162,939
Average Outstanding Shares (Diluted )		14,668,658		14,957,469		14,984,084		14,979,746

	Quarter Ende d
	March 31 ,		June 30 ,		September 30 ,		December 31 ,
	201 5		201 5		201 5		201 5
Net sale s	$	46,347	$	54,116	$	56,662	$	53,192
Gross profi t	$	15,796	$	18,531	$	19,224	$	17,882
Income before taxes on incom e	$	3,223	$	5,394	$	5,581	$	4,698
Net incom e	$	2,043	$	3,624	$	4,031	$	3,368
Per Share Data :
Basi c
Net earnings	$	0.15	$	0.26	$	0.29	$	0.24
Dilute d
Net earnings	$	0.14	$	0.25	$	0.28	$	0.23
Average Outstanding Shares (Basic )		13,584,922		13,730,646		13,833,561		13,894,907
Average Outstanding Shares (Diluted )		14,548,084		14,577,342		14,585,688		14,603,464

On

December 22, 2017,

the U.S. enacted the Tax Cuts and Jobs Act (“

Tax Act”) that instituted fundamental changes to the U.S. tax system. In the

fourth

quarter of

2017,

income tax expense of

$5.0

million was unfavorably impacted by net discrete adjustments of

$4.0

million related to the enactment Tax Act. See Note

7.

The Company elected to early adopt ASU

2016

-

09

in the

fourth

quarter of

2016.

As a result,

there was an increase in the income tax benefit of

$0.2

million for the

three

months ended

March 31, 2016,

$0.2

million for the

three

months ended

June 30, 2016,

and

$0.1

million for the

three

months ended

September 30, 2016,

from the previously reported income tax provisions in the consolidated statements of comprehensive income for the first, second, and

third

quarters of fiscal year

2016.

See Note

1

(y).

XML

Note 10 - Rentals

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Lessee, Operating Leases [Text Block]

NOTE

10

– Rentals:

Aggregate rent expense, including month-to-month rentals, approximated

$1.1

million,

$1.1

million and

$0.3

million for the years ended

December 31, 2017,

2016,

and

2015,

respectively. Long-term lease commitments totaling

$2.1

million are as follows:

2018

-

$0.9

million,

2019

-

$0.6

million,

2020

-

$0.5

million, and

2021

-

$0.1

million.

XML

Note 11 - Contingencies

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Commitments and Contingencies Disclosure [Text Block]

NOTE

11

– Contingencies:

The Company is involved in various legal actions and claims arising from the normal course of business. In the opinion of management, the ultimate outcome of these matters will

not

have a material impact on the Company

’s results of operations, cash flows, or financial position.

During

2005,

the Company entered into severance protection agreements with senior management. The terms of these agreements require the Company to potentially make certain payments to members of senior management in the event of a change in control of the Company.

XML

Note 12 - Share-based Compensation

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

NOTE

1

2

– Share-Based Compensation:

In

2003,

the stockholders of the Company approved the

2003

Incentive Stock and Awards Plan (the

“2003

Plan

”), authorizing the granting of incentive stock options, non-qualified stock options, stock appreciation rights (“SARS”), restricted stock, performance stock and other stock based compensation. This plan expired in

May

of

2013,

at which time, the stockholders of the Company approved the

2013

Incentive Stock and Awards Plan (the

“2013

Plan”), authorizing the granting of incentive stock options, non-qualified stock options, SARS, restricted stock, performance shares and other stock based compensation. A total of

5,000,000

shares of common stock (subject to adjustment for expirations and cancellations of options outstanding from the

2003

Plan subsequent to its termination) have been reserved for issuance under the

2013

Plan. All options and SARS under both plans have been or will be granted with exercise prices at least equal to the fair market value of the shares on the date of grant. At

December 31, 2017,

the Company had

3,667,577

shares of common stock available for grant of share-based compensation under the

2013

Plan.

Share-based compensation is recorded in selling and administrative expense in the

consolidated statements of comprehensive income. The following table details the share-based compensation expense by plan and the total related tax benefit for the periods presented:

	Year Ended December 31 ,
	(In thousands )
	201 7		201 6		201 5
Stock options and SAR S	$	1,093	$	1,071	$	1,079
Restricted stoc k		331		317		282
Performance share s		240		250		-
Total share-based compensation expens e	$	1,664	$	1,638	$	1,361
Related income tax benefi t	$	229	$	325	$	203

Stock options and SARS

The Company grants stock options and stock settled

SARS to employees that allow them to purchase shares of the Company’s common stock. Options are also granted to outside members of the Board of Directors of the Company. The Company determines the fair value of stock options and SARS at the date of grant using the Black-Scholes valuation model.

All options and SARS vest immediately at the date of grant. Awards generally expire

five

years after the date of grant with the exception of options granted to outside directors, which expire

ten

years after the date of grant. The Company issues new shares upon the exercise of stock options and SARS.

A summary of stock option transactions during the

two

years ended

December 31, 2017

follows:

	No. o f			Weighted Averag e
	Share s			Exercise Pric e
Outstanding December 31, 201 5		946,546		$	8.39
Grante d		172,862			16.53
Exercise d		(279,766	)		7.31
Lapse d		(11,131	)		5.92
Cancelle d		(3,260	)		17.53
Outstanding December 31, 201 6		825,251		$	10.46
Grante d		155,142		$	18.67
Exercise d		(336,726	)		8.71
Lapse d		(1,100	)		5.86
Cancelle d		(8,690	)		15.82
Outstanding December 31, 201 7		633,877		$	13.33

At

December 31,

201

7,

options outstanding, all of which were fully vested and exercisable, had an intrinsic value of

$8.5

million. The weighted-average remaining contractual term was

46

months.

Options exercised during

the years ended

December 31, 2017,

2016

and

2015,

had intrinsic values of

$4.2

million,

$3.1

million and

$3.5

million respectively.

The weighted average fair value

s of the Company’s

155,142,

172,862

and

153,618

options granted during the years ended

December 31, 2017,

2016

and

2015

were

$5.56

and

$4.69

and

$5.22,

respectively.

During the ye

ars ended

December 31, 2017,

2016

and

2015,

respectively, the Company received

$1.9

million,

$1.5

million and

$1.8

million in cash from stock option exercises. Current tax benefits of

$0.8

million,

$0.4

million and

$0.6

million, respectively, were recognized for these exercises. Additionally, during the years ended

December 31, 2017,

2016

and

2015,

respectively, the Company received

50,981,

27,770

and

14,571

shares of its common stock as payment of the exercise price in the exercise of stock options for

144,443,

81,608

and

50,224

shares of its common stock related to the exercise of stock options.

The following table summarizes information about stock options out

standing as of

December 31, 2017:

Range o f					Weighted Average Remainin g		Weighted Averag e
Exercise Pric e			Share s		Contractual Life (Years )		Exercise Pric e
$3.82	-	$5.5 5		59,000		2.08	$	4.81
$5.65	-	$7.3 6		151,995		1.96	$	6.65
$7.96	-	$10.3 8		45,100		4.53	$	8.87
$16.35	-	$21.6 3		377,782		4.79	$	17.88
$3.82	-	$21.6 3		633,877		3.84	$	13.33

A summary of stock-settled SARS transactions during the

two

years ended

December 31, 2017

follows

:

	No. o f			Weighted Averag e
	Share s			Exercise Pric e
Outstanding December 31, 201 5		381,566		$	8.14
Grante d		58,108			16.35
Exercise d		(114,168	)		6.27
Lapse d		-			-
Cancelle d		-			-
Outstanding December 31, 201 6		325,506		$	10.26
Grante d		43,988			16.97
Exercise d		(222,990	)		6.90
Lapse d		-
Cancelle d		-
Outstanding December 31, 201 7		146,504		$	17.38

At

December 31, 2017,

SARS outstanding, all of which were fully vested and exercisable, had an aggregate intrinsic value of

$1.4

million. The weighted-average remaining contractual term was

35

months.

SARS exer

cised during the years ended

December 31, 2017,

2016

and

2015,

respectively, had intrinsic values of

$3.5

million,

$1.5

million and

$2.6

million respectively. Current tax benefits of

$1.3

million,

$0.5

million and

$1.0

million respectively, were recognized for these exercises. The weighted average grant date fair values of the Company’s SARS granted during the years ended

December 31, 2017,

2016

and

2015

was

$4.83,

$4.49

and

$5.20,

respectively.

The following table summarizes information about

SARS outstanding as of

December 31, 2017:

Range o f					Weighted Average Remainin g		Weighted Averag e
Exercise Pric e			SAR S		Contractual Life (Years )		Exercise Pric e
$16.35	-	$18.66		146,504		2.92	$	17.38

At

December 31,

2017

shares available for grant as awards under the plan were

3,667,577.

Options and SARS have never been repriced by the Company in any year.

The following table summarizes significant assumptions utilized to determine the fair value of

options and SARS:

Years ende d
December 31 ,	SAR S	Option s
Exercise pric e
201 7	$16.97	$16.97	-	$21.6 3
201 6	$16.35	$16.35	-	$18.5 5
201 5	$18.66	$16.78	-	$18.6 6
Market pric e
201 7	$16.97	$16.97	-	$21.6 3
201 6	$16.35	$16.35	-	$18.5 5
201 5	$18.66	$16.78	-	$18.6 6
Risk free interest rate 1
201 7	1.9%	1.8%	-	2.4%
201 6	1.3%	1.1%	-	1.8%
201 5	1.5%	1.5%	-	2.1%
Expected award life (years) 2	5	5	-	10
Expected volatility 3
201 7	36.6%	36.6%	-	41.4%
201 6	36.5%	36.5%	-	40.3%
201 5	34.9%	34.9%	-	39.0%
Expected dividend yield 4
201 7	2.1%	1.8%	-	2.1%
201 6	2.0%	1.8%	-	2.1%
201 5	1.6%	1.6%	-	1.9%

1

The risk-free interest rate is based on the yield of a U.S. treasury bond with a similar maturity as the expected life of the awards.

2

The expected life in years for awards granted was based on the historical exercise patterns experienced by the Company when the award is made.

3

The determination of expected stock price volatility for awards granted in each of the

three

years ended

December 31, 2017,

2016

and

2015

was based on historical Superior common stock prices over a period commensurate with the expected life.

4

The dividend yield assumption is based on the history and expectation of the Company’s dividend payouts.

Restricted Stock

The Company has

granted restricted stock to directors and certain employees under the terms of the

2013

Plan which vest at a specified future date, generally after

three

years, or when certain conditions are met. The shares are subject to accelerated vesting under certain circumstances pursuant to the

2013

Plan. Expense for each of these grants is based on the fair value at the date of the grant and is being recognized on a straight-line basis over the respective service period. As of

December 31, 2017,

the Company had

$0.7

million of unrecognized compensation cost related to nonvested grants expected to be recognized over the weighted average service period of

2.01

years.

A summary of restricted stock transactions during the years ended

December 31, 2017

follows

:

	No. o f			Weighted Averag e
	Share s			Grant Date Fair Valu e
Outstanding December 31, 201 5		114,342		$	8.39
Grante d		10,396			16.35
Veste d		-			-
Forfeite d		(1,050	)		21.92
Outstanding December 31, 201 6		123,688		$	8.94
Grante d		43,706			18.30
Veste d		(106,016	)		7.62
Forfeite d		-			-
Outstanding December 31, 201 7		61,378		$	17.89

Performance Shares

In

2016,

the Compensation Committee of the Board of Directors approved grants of performance shares under the terms of the

2013

Plan. Under the terms of the

grants, certain employees received service-based or service-based and performance-based shares. The service-based awards vest after the service period is met, which is generally

three

to

five

years.  Expense for these grants is based on the fair value on the date of the grant and is being recognized on a straight-line basis over the respective service period. The performance-based shares generally vest after

five

years if the performance and service targets are met. The Company evaluates the performance conditions associated with these grants each reporting period to determine the expected number of shares to be issued. Based upon this evaluation, expected expenses for these grants are being recognized based on the fair value on the date of the grant on a straight-line basis over the respective service period. The shares are subject to accelerated vesting under certain circumstances as outlined in the

2013

Plan. As of

December 31, 2017,

the Company had

$1.6

million of unrecognized compensation cost related to nonvested grants expected to be recognized over the weighted average service period of

3.25

years.

A summary of performance share transactions during the year ended

December 31, 2017

follows

:

	No. o f			Weighted Averag e
	Share s			Grant Date Fair Valu e
Outstanding December 31, 201 6		101,000		$	16.36
Grante d		50,826			18.39
Veste d		-			-
Forfeite d		(33,334	)		16.35
Outstanding December 31, 201 7		118,492		$	17.24

XML

Note 13 - Earnings Per Share

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Earnings Per Share [Text Block]

NOTE

13

– Earnings Per Share

:

The following table represents a reconciliation of basic and diluted earnings per share

:

	201 7		201 6		201 5
Net earnings used in the computation of basic an d diluted earnings per share (in thousands )	$	15,022	$	14,638	$	13,066
Weighted average share s outstanding - basi c		14,510,156		14,082,243		13,761,009
Common stock equivalent s		608,612		815,246		817,635
Total weighted average share s outstanding - diluted		15,118,768		14,897,489		14,578,644
Per Share Data :
Basi c
Net earning s	$	1.04	$	1.04	$	0.95
Dilute d
Net earning s	$	0.99	$	0.98	$	0.90

Awards to purchase an average of

37,450

shares of common stock with a weighted average exercise price of

$18.65

per share were outstanding during

2017

but were

not

included in the computation of diluted EPS because the awards’ exercise prices were greater than the average market price of the common shares. Awards to purchase an average of

124,000

shares of common stock with a weighted average exercise price of

$18.53

per share were outstanding during

2016

but were

not

included in the computation of diluted EPS because the awards’ exercise prices were greater than the average market price of the common shares. Awards to purchase an average of

108,400

shares of common stock with a weighted average exercise price of

$17.98

per share were outstanding during

2015

but were

not

included in the computation of diluted EPS because the awards’ exercise prices were greater than the average market price of the common shares.

XML

Note 14 - Other Current Liabilities

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Accounts Payable and Accrued Liabilities Disclosure [Text Block]

NOTE

14

– Other Current Liabilities

:

(In thousands

)

	Year Ended December 31 ,
	201 7		201 6
Salaries, wages, commissions and vacation pay	$	7,851	$	5,600
Accrued rebate s		1,089		1,932
Defined contribution plan accrua l		104		897
Customer deposit s		473		670
Other accrued expenses		2,892		1,617
	$	12,409	$	10,716

XML

Note 15 - Supplemental Cash Flow Information

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Cash Flow, Supplemental Disclosures [Text Block]

NOTE

15

– Supplemental Cash Flow Information

:

 (In thousands

)

	Year Ended December 31,
	201 7		201 6		201 5
Income taxes pai d	$	7,173	$	5,076	$	6,897
Interest pai d	$	727	$	694	$	523

During the year

s ended

December 31, 2017,

2016,

and

2015

the Company received

50,981,

27,770

and

14,571

shares, respectively, of its common stock as payment for the exercise of stock options for

144,443,

81,608

and

50,224

shares, respectively.

XML

Note 16 - Stock Repurchase Plan

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Stockholders' Equity Note Disclosure [Text Block]

NOTE

16

– Stock Repurchase Plan:

On

August 1, 2008,

the Company

’s Board of Directors approved an increase to the outstanding authorization under its common stock repurchase program to allow for the repurchase of

1,000,000

additional shares of the Company’s outstanding shares of common stock. Under this program the Company reacquired and retired -

0

-,

45,100

and -

0

- shares of its common stock in the years ended

December 31, 2017,

2016

and

2015,

respectively. At

December 31, 2017,

the Company had

216,575

shares remaining on its common stock repurchase program. Shares purchased under the common stock repurchase program are constructively retired and returned to unissued status. The Company considers several factors in determining when to make share repurchases, including among other things, the cost of equity, the after-tax cost of borrowing, the debt to total capitalization targets and the expected future cash needs. There is

no

expiration date or other restriction governing the period over which the Company can make its share repurchases under the program.

XML

Note 17 - Operating Segment Information

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

NOTE

1

7

–

Operating Segment Information

:

The Company

classifies its businesses into

three

operating segments based on the types of products and services provided. The Uniforms and Related Products segment consists of the sale of uniforms and related items. The Remote Staffing Solutions segment consists of sales of staffing solutions. The Promotional Products segment consists of sales to customers of promotional products and other branded merchandise.

The Company

evaluates the performance of each operating segment based on several factors of which the primary financial measures are operating segment net sales and earnings before income taxes. The accounting policies of the operating segments are the same as those described in Note 

1

entitled Summary of Significant Accounting Policies. Amounts for corporate expenses are included in the Uniforms and Related Products segment totals. Information related to the operations of the Company's operating segments is set forth below:

(In thousands )
	Uniforms and Related Product s			Remote Staffing Solution s		Promotional Product s		Intersegment Elimination s			Tota l
Twelve Months Ende d
December 31, 201 7
Net sale s	$	204,644		$	23,021	$	42,904	$	(3,755	)	$	266,814
Gross margi n	$	72,463		$	12,460	$	13,860	$	(2,431	)	$	96,352
Selling and administrative expense s		54,191			7,877		12,179		(2,431	)		71,816
Gain (loss) on sale of property, plant and equipmen t		(2	)		1,050		-		-			1,048
Interest expens e		387			-		415		-			802
Income before taxes on incom e	$	17,883		$	5,633	$	1,266	$	-		$	24,782
Depreciation and amortizatio n	$	4,223		$	846	$	584	$	-		$	5,653
Capital expenditure s	$	2,870		$	1,156	$	219	$	-		$	4,245
Total asset s	$	182,623		$	21,846	$	54,997	$	(40,528	)	$	218,938

	Uniforms and Related Product s		Remote Staffing Solution s		Promotional Product s			Intersegment Elimination s			Tota l
Twelve Months Ende d
December 31, 201 6
Net sale s	$	210,373	$	17,953	$	27,816		$	(3,546	)	$	252,596
Gross margi n	$	69,987	$	9,616	$	9,690		$	(2,311	)	$	86,982
Selling and administrative expense s		52,225		6,096		10,386			(2,311	)		66,396
Interest expens e		462		-		226			-			688
Income before taxes on income (loss )	$	17,300	$	3,520	$	(922	)	$	-		$	19,898
Depreciation and amortizatio n	$	4,023	$	494	$	418		$	-		$	4,935
Capital expenditure s	$	3,383	$	3,872	$	130		$	-		$	7,385
Total asset s	$	176,070	$	19,752	$	28,480		$	(27,454	)	$	196,848

	Uniforms and Related Product s		Remote Staffing Solution s		Promotional Product s		Intersegment Elimination s			Tota l
Twelve Months Ende d
December 31, 201 5
Net sale s	$	198,319	$	15,604	$	-	$	(3,606	)	$	210,317
Gross margi n	$	65,247	$	8,579	$	-	$	(2,393	)	$	71,433
Selling and administrative expense s		49,225		5,186		-		(2,393	)		52,018
Interest expens e		519		-		-		-			519
Income before taxes on incom e	$	15,503	$	3,393	$	-	$	-		$	18,896
Depreciation and amortizatio n	$	3,561	$	312	$	-	$	-		$	3,873
Capital expenditure s	$	3,003	$	5,066	$	-	$	-		$	8,069
Total asset s	$	140,710	$	14,551	$	-	$	(3,530	)	$	151,731

XML

Note 18 - Acquisition of Business

12 Months Ended

Dec. 31, 2017

Notes to Financial Statements

Business Combination Disclosure [Text Block]

NOTE

18

– Acquisition of Business

es

:

BAMKO

On

March 8, 2016,

the Company closed on the acquisition of substantially all of the assets of BAMKO, Inc.

  The transaction had an effective date of

March 1, 2016. 

The purchase price for the asset acquisition consisted of approximately

$15.2

million in cash, net of cash acquired, the issuance of approximately

324,000

restricted shares of Superior’s common stock that vest over a

five

-year period, potential future payments of approximately

$5.5

million in additional contingent consideration through

2021,

and the assumption of certain liabilities of BAMKO, Inc.  The transaction also included the acquisition of BAMKO, Inc.’s subsidiaries in Hong Kong, China, Brazil and England as well as an affiliate in India.

The foregoing description of the asset purchase agreement does

not

purport to be complete and is subject to, and qualified in its entirety by, the full text of the agreement, which is filed as an exhibit to the Quarterly Report on Form

10

-Q filed on

April

28,

2016.

Fair Value of Consideration Transferre

d

A Summary of the purchase price is as follows (in thousands) :
Cash consideration at closing, net of cash acquire d	$	15,161
Restricted shares of Superior common stock issue d		4,558
Contingent consideratio n		5,205
Total Consideration s	$	24,924

Assets Acquired and Liabilities Assumed

The total purchase price was allocated to the acquired tangible and intangible assets and assumed liabilities of BAMKO

, Inc. based on their estimated fair values as of

March 1, 2016.

The excess of the purchase price over the estimated fair values of the assets acquired and liabilities assumed was allocated to goodwill.

The following table presents the

allocation of the total fair value of consideration transferred, as shown above, to the acquired tangible and intangible assets and assumed liabilities of BAMKO based on their fair values as of the effective date of the transaction.

The following is our assignment of the aggregate consideration (in thousands):

Accounts receivabl e	$	4,885
Prepaid expenses and other current asset s		3,200
Inventorie s		236
Property, plant and equipmen t		199
Other Asset s		100
Identifiable intangible asset s		11,360
Goodwil l		6,994
Total asset s	$	26,974
Accounts Payable s		1,314
Other current liabilitie s		736
Total liabilitie s	$	2,050

The Company recorded

$11.4

million

in identifiable intangibles at fair value, consisting of

$2.1

million in acquired customer relationships,

$0.4

million in non-compete agreements from the former owners of BAMKO, Inc., and

$8.9

million for the acquired trade name.

The estimated

fair value for acquisition-related contingent consideration payable is

$5.2

million as of

December 31, 2017.

The Company will continue to evaluate this liability for remeasurement at the end of each reporting period and any change will be recorded in the Company’s consolidated statement of comprehensive income. The carrying amount of the liability

may

fluctuate significantly and actual amounts paid

may

be materially different from the estimated value of the liability.

Goodwill was calculated as the difference between the fair value of the consideration and the values assigned to the assets acquired and liabilities assumed.

The intangible assets associated with the customer relationships will be amortized for

seven

years beginning on

March 1, 2016

and the non-compete agreement will be amortized for

five

years and

ten

months. The trade name is considered an indefinite-life asset and as such will

not

be amortized.

The Company recognized amortization expense on these acquired intangibl

e assets of

$0.4

million for the year ended

December 31, 2017

and

$0.3

million for the year ended

December 31, 2016.

For the year ended

December 31,

201

6,

the Company incurred and expensed transaction related expenses of approximately

$1.1

million. This amount is included in selling and administrative expenses on the consolidated statements of comprehensive income.

On a pro forma basis as if the results of this acquisition had been included in our consolidated results for the years ended

December 31, 2016

and

2015,

net sales would have increased approximately

$6.6

million and

$31.5

million respectively.

  Net income would have increased

$1.1

million or

$0.08

per share for the year ended

December 31, 2016,

and decreased by

$0.4

million or

$0.03

per share for the year ended

December 31, 2015. 

Pre-tax acquisition related expenses of

$1.1

million have been recorded as though they were incurred as of

January 1, 2014

for this comparison.

Public Identity

On

August 21, 2017,

BAMKO acquired substantially all of the assets and assumed certain liabilities of PublicIdentity

, Inc. (“Public Identity”) of Los Angeles, CA. Public Identity is a promotional products and branded merchandise agency that provides innovative, high quality merchandise and promotional products to corporate clients and universities across the country.

The purchase price for the acquisition consisted of

$0.8

million in cash, the issuance of approximately

54,000

restricted shares of Superior

’s common stock and future payments of approximately

$0.4

million in additional consideration through

2020.

  The majority of the shares issued vest over a

three

-year period.  The preliminary estimated fair value of the consideration transferred is approximately

$2.3

million.  Based upon our preliminary estimates of their acquisition date fair values, we have assigned approximately

$1.7

million to identifiable intangible assets and approximately

$0.6

million to goodwill.  Our final fair value determinations

may

be significantly different. 

Tangerine Promotions

On

November 30, 2017,

BAMKO closed on the acquisition of

substantially all of the assets of Tangerine Promotions, Ltd and Tangerine Promotions West, Inc. (collectively “Tangerine”). The transaction had an effective date of

December 1, 2017. 

Tangerine is a promotional products and branded merchandise agency that serves many well-known brands.  The company is

one

of the leading providers of Point-of-Purchase (POP) and Point-of-Sale (POS) merchandise in the country.  The purchase price for the asset acquisition consisted of approximately

$7.2

million in cash, subject to adjustment, the issuance of approximately

83,000

restricted shares of Superior’s common stock that vests over a

four

-year period, the potential future payments of approximately

$5.5

million in additional contingent consideration through

2021,

and the assumption of certain liabilities.

The foregoing description of the asset purchase agreement does

not

purport to be complete and is subject to, and qualified in its entirety by, the full text of the agreement, whic

h is filed as an exhibit to this Annual Report.

Fair Value of Consideration Transferre

d

A Summary of the purchase price is as follows (in thousands) :
Cash consideration at closin g	$	7,222
Restricted shares of Superior common stock issue d		1,657
Contingent consideratio n		3,209
Total Consideration s	$	12,088

Assets Acquired and Liabilities Assumed

The total purchase price was allocated to the acquired tangible and intangible assets and assumed liabilities of

Tangerine based on their estimated fair values as of

December 1, 2017.

The excess of the purchase price over the estimated fair values of the assets acquired and liabilities assumed was allocated to goodwill.

The following table presents the allocation of the total fair value of consideration transferred, as shown above, to the acquired tangible and intangible assets and assumed liabilities o

f Tangerine based on their estimated fair values as of the effective date of the transaction.

The

assets and liabilities of Tangerine shown below are based on our preliminary estimates of their acquisition date fair values. Our final fair value determinations

may

be significantly different than those shown below.

The following is our

preliminary assignment of the aggregate consideration (in thousands):

Accounts receivabl e	$	5,051
Prepaid expenses and other current asset s		969
Property, plant and equipmen t		131
Identifiable intangible asset s		6,495
Goodwil l		4,169
Total asset s	$	16,815
Accounts Payable s		3,374
Other current liabilitie s		1,353
Total liabilitie s	$	4,727

The Company recorded

$6.5

million in identifiable intangibles at fair value, consisting of

$3.1

million in acquired customer relationships,

$0.2

million in non-compete agreements from the former owners of Tangerine, and

$3.2

million for the acquired trade name.

The estimated fair value for acquisition-related contingent consideration payable is $

3.2

million as of

December 31, 2017.

The Company will continue to evaluate this liability for remeasurement at the end of each reporting period and any change will be recorded in the Company’s consolidated statement of comprehensive income. The carrying amount of the liability

may

fluctuate significantly and actual amounts paid

may

be materially different from the estimated value of the liability.

Goodwill was calculated as the difference between the fair value of the consideration and the values assigned to the assets acquired and liabilities assumed.

The intangible assets associated with the customer relationships will be amortized for

seven

years beginning on

December 1, 2017

and the non-compete agreement will be amortized for

seven

years. The trade name is considered an indefinite-life asset and as such will

not

be amortized.

The Company recognized amortization expense on these acquired intangible assets of $

0.1

million for the year ended

December 31, 2017.

For the year ended

December 31,

201

7,

the Company incurred and expensed transaction related expenses of approximately

$0.2

million. This amount is included in selling and administrative expenses on the consolidated statements of comprehensive income.

On a pro forma basis as if the results of this acquisition had been included in our consolidated results for the entire year ended

December 31, 2017

and years ended

December 31, 2016

and

2015,

net sales would have increased approximately

$35.1

million,

 

$43.1

million and

$48.0

million respectively.  Net income would have increased

$0.1

million in

2017,

decreased

$2.4

million or

$0.17

per share in

2016,

and increased

$1.9

million or

$0.13

per share in

2015.

   Pre-tax acquisition related expenses of

$0.2

million have been recorded as though they were incurred as of

January 1, 2015

for this comparison.

XML

Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2017

Accounting Policies [Abstract]

Basis of Accounting, Policy [Policy Text Block]

b) Basis of presentation

The consolidated financial statements include the accounts of Superior Uniform Group, Inc. and its wholly-owned subsidiaries, The

Office Gurus, LLC, SUG Holding, Fashion Seal Corporation, and BAMKO, LLC; The Office Gurus, Ltda, de C.V., The Office Masters, Ltda., de C.V. and The Office Gurus, Ltd., each a subsidiary of Fashion Seal Corporation and SUG Holding; and Power Three Web, Ltda. and Superior Sourcing, each a wholly-owned subsidiary of SUG Holding; BAMKO Importação, Exportação e Comércio

de Brindes Ltda., a subsidiary of BAMKO, LLC and SUG Holding; Guangzhou Ben Gao Trading Limited, Worldwide Sourcing Solutions Limited, and BAMKO UK, Limited, each a direct or indirect subsidiary of BAMKO, LLC, and BAMKO India Private Limited, a

99%

-owned subsidiary of BAMKO, LLC. All of these entities are referred to collectively as “the Company”. Intercompany items have been eliminated in consolidation.

Cash and Cash Equivalents, Policy [Policy Text Block]

c) Cash and cash equivalents

The Company considers all highly liquid investments with an original maturity of

three

months or less at the time of purchase to be cash equivalents.

Revenue Recognition, Policy [Policy Text Block]

d)

Revenue recognition and allowance for doubtful accounts

The Company recognizes revenue as products are shipped and title passes

and as services are provided.

The Company collects sales tax for various taxing authorities. It is the Company’s policy to record these amounts on a net basis. Therefore, these amounts are

not

included in net sales for the Company. A provision for estimated returns and allowances is recorded based upon historical experience and current allowance programs. Judgments and estimates are used in determining the collectability of accounts receivable. The Company analyzes specific accounts receivable and historical bad debt experience, customer credit worthiness, current economic trends and the age of outstanding balances when evaluating the adequacy of the allowance for doubtful accounts. Management judgments and estimates are used in connection with establishing the allowance in any accounting period. Changes in estimates are reflected in the period they become known. Charge-offs of accounts receivable are made once all collection efforts have been exhausted. If the financial condition of the Company's customers were to deteriorate, resulting in an impairment of their ability to make payments, additional allowances

may

be required.

Accounts Receivable Other [Policy Text Block]

e)

     Accounts receivable-other

The Company purchases raw materials and has them delivered to certain suppliers of the Company. The Company pays for the raw materials and then deducts the cost of these materials from payments to the suppliers at the time the related finished goods are invoiced to the Company by those suppliers.

Advertising Costs, Policy [Policy Text Block]

f

) Advertising expenses

The Company expenses advertising costs as incurred. Advertising costs for

each of the years ended

December 31, 2017,

2016

and

2015,

respectively, were

$0.1

million.

Shipping and Handling Cost, Policy [Policy Text Block]

g

) Cost of goods sold and shipping and handling fees and costs  

Cost of goods sold consists primarily of direct costs of acquiring inventory, including cost of merchandise, inbound freight charges, purchasing

, receiving and inspection costs, for our Uniforms and Related Products segment and our Promotional Products segment. Cost of goods sold for our Remote Staffing Solutions segment includes salaries and payroll related benefits for agents. The Company includes shipping and handling fees billed to customers in net sales. Shipping and handling costs associated with out-bound freight are generally recorded in cost of goods sold. Other shipping and handling costs are included in selling and administrative expenses and totaled

$10.9

million,

$10.6

million and

$9.3

million for the years ended

December 31, 2017,

2016

and

2015,

respectively.

Inventory, Policy [Policy Text Block]

h

) Inventories

Inventories are stated at the lower of cost (

first

-in,

first

-out method) or market value. Judgments and estimates are used in determining the likelihood that goods on hand can be sold to customers. Historical inventory usage and current revenue trends are considered in estimating both excess and obsolete inventories. If actual product demand and market conditions are less favorable than those projected by management, additional inventory write-downs

may

be required.

Property, Plant and Equipment, Policy [Policy Text Block]

i

) Property, plant and equipment

Property, plant and equipment are stated at cost

, less accumulated depreciation and amortization. Major renewals and improvements are capitalized, while replacements, maintenance and repairs which do

not

improve or extend the life of the respective assets are expensed on a current basis. Costs of assets sold or retired and the related accumulated depreciation and amortization are eliminated from accounts and the net gain or loss is reflected in the consolidated statements of comprehensive income within selling and administrative expenses.

Goodwill and Intangible Assets, Goodwill, Policy [Policy Text Block]

j) 

Goodwill

Goodwill represents the excess of the cost of an acquisition over the fair value of the net assets acquired. The Company tests goodwill for impairment annually as of

December

31st

and/or when an event occurs or circumstances change such that it is more likely than

not

that impairment

may

exist. Examples of such events and circumstances that the Company would consider include the following:

• macroeconomic conditions such as deterioration in general economic conditions, limitations on accessing capital, or other developments in equity and credit markets;

• industry and market considerations such as a deterioration in the environment in which the Company operates, an increased competitive environment, a decline in market-dependent multiples or metrics (considered in both absolute terms and relative to peers), a change in the market for the Company's products or services, or a regulatory or political development;

• cost factors such as increases in raw materials, labor, or other costs that have a negative effect on earnings and cash flows;

• overall financial performance such as negative or declining cash flows or a decline in actual or planned revenue or earnings compared with actual and projected results of relevant prior periods;

• other relevant entity-specific events such as changes in management, key pe rsonnel, strategy, or customers. 

Goodwill is tested at a level of reporting referred to as "the reporting unit." The

Company's reporting units are defined as each of its

three

reporting segments with its goodwill included in the Uniforms and Related Products segment of

$4.1

million and

$11.9

million in the Promotional Products segment.

An entity has the option to

first

assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than

not

(that is, a likelihood of more than

50%

) that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, an entity determines it is

not

more likely than

not

that the fair value of a reporting unit is less than its carrying amount, then performing the impairment test is unnecessary. The Company completed its assessment of the qualitative factors as of

December 31,

201

7

and determined that it was

not

more likely than

not

that the fair value of the reporting unit was less than its carrying value.

Intangible Assets, Finite-Lived, Policy [Policy Text Block]

k

) Other intangible assets

Other intangible assets consist

of customer relationships, a non-compete agreement and trade names acquired in previous business acquisitions.

The cost, amortization and net value of customer relationships and non-compete agreement as of

December 31, 2017

and

2016

were as follows (In thousands):

	Customer Relationships			Weighted Average Life (years)		Non-Compete Agreemen t			Weighted Average Life (years )		Customer Backlo g			Weighted Average Life (years )
December 31, 201 7
Cos t	$	15,530			8.8	$	5,551			5.1	$	122			0.5
Accumulated amortizatio n		(4,782	)				(4,619	)				(10	)
Ne t	$	10,748				$	932				$	112
December 31, 201 6
Cos t	$	12,311			9.4	$	5,370			5.1	$	0			N/A
Accumulated amortizatio n		(4,490	)				(3,553	)				0
Ne t	$	7,821				$	1,817				$	0

Amortization expense for other intangible assets was

$2.4

million,

$2.3

million and

$2.1

million for the years ended

December 31, 2017,

2016

and

2015,

respectively.

  Amortization expense for other intangible assets is expected to be

$2.5

million in

2018;

$1.9

million in each of the years ending

December 31, 2019

through

2021;

$1.8

million in

2022;

$1.1

million in

2023

and

$0.5

million in

2024.

As part of the acquisition of HPI in

2013,

the Company recorded

$4.7

million as the fair value of the acquired trade name in other intangible assets. This asset is considered to have an indefinite life and as such is

not

being amortized.

As part of the acquisition of BAMKO in

2016,

the Company recorded

$8.9

million as the fair value of the acquired trade name in other intangible assets. This asset is considered to have an indefinite life and as such is

not

being amortized.

As part of the acquisitions of Public Identity and Tangerine in

2017,

the Company recorded

$0.5

million and

$3.2

million, respectively as the fair value of the acquired trade names in other intangible assets. These amounts are considered to have an indefinite life and as such are

not

being amortized.

Depreciation, Depletion, and Amortization [Policy Text Block]

l

) Depreciation and amortization

Plant and equipment are depreciated

on the straight-line basis at

2.5%

to

5%

for buildings,

2.5%

to

20%

for improvements,

10%

to

33.33%

for machinery, equipment and fixtures and

20%

to

33.33%

for transportation equipment. Leasehold improvements are amortized over the terms of the leases inasmuch as such improvements have useful lives of at least the terms of the respective leases.

Pension and Other Postretirement Plans, Policy [Policy Text Block]

m

) Employee benefits

Pension plan costs are funded currently based on actuarial estimates, with prior service costs amortized over

20

years. The Company recognizes settlement gains and losses in its

consolidated financial statements when the cost of all settlements in a year is greater than the sum of the service cost and interest cost components of net periodic pension cost for the plan for the year.

Insurance [Policy Text Block]

n

) Insurance

The Company self-insures for certain

obligations related to employee health programs. The Company also purchases stop-loss insurance policies to protect it from catastrophic losses. Judgments and estimates are used in determining the potential value associated with reported claims and for losses that have occurred, but have

not

been reported. The Company's estimates consider historical claim experience and other factors. The Company's liabilities are based on estimates, and, while the Company believes that the accrual for loss is adequate, the ultimate liability

may

be in excess of or less than the amounts recorded. Changes in claim experience, the Company's ability to settle claims or other estimates and judgments used by management could have a material impact on the amount and timing of expense for any period.

Income Tax, Policy [Policy Text Block]

o

) Taxes on income

Income taxes are provided for under the liability method, whereby deferred tax assets are recognized for deductible temporary differences and operating loss and tax credit carryforwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than

not

that some portion or all of the deferred tax assets will

not

be realized.

Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. The calculation of the Company’s tax liabilities also involves dealing with uncertainties in the application of complex tax regulations. The Company recognizes liabilities for uncertain income tax positions based on estimates of whether, and the extent to which, additional taxes will be required. The Company also reports interest and penalties related to uncertain income tax positions as income taxes. Refer to Note

7.

Impairment or Disposal of Long-Lived Assets, Policy [Policy Text Block]

p

) Impairment of long-lived assets

L

ong-lived assets, such as property and equipment, and purchased intangibles subject to amortization, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset

may

not

be recoverable. Recoverability of the asset is measured by comparison of its carrying amount to future net cash flows the asset is expected to generate. If such assets are considered to be impaired, the impairment to be recognized is measured as the amount by which the carrying amount of the asset exceeds its fair value. There was

no

impairment of long-lived assets for the years ended

December 31, 2017,

2016,

and

2015.

Share-based Compensation, Option and Incentive Plans Policy [Policy Text Block]

q

) Share-based compensation

The Company awards share-based compensation as an incentive for employees to contribute to the Company

’s long-term success. Historically, the Company has granted options, stock-settled stock appreciation rights, and restricted stock. In

2016,

the Company began issuing performance shares as well. At

December 31, 2017,

the Company had

3,667,577

shares of common stock available for grant of awards of share-based compensation under its

2013

Incentive Stock and Awards Plan.

T

he Company recognizes share-based compensation expense for all awards granted to employees, which is based on the fair value of the award on the date of grant. Determining the appropriate fair value model and calculating the fair value of stock compensation awards requires the input of certain highly complex and subjective assumptions, including the expected life of the stock compensation awards and the Company’s common stock price volatility, risk free interest rate and dividend rate. The assumptions used in calculating the fair value of stock compensation awards represent management’s best estimates, but these estimates involve inherent uncertainties and the application of judgment. As a result, if factors change and the Company deems it necessary to use different assumptions, stock compensation expense could be materially different from what has been recorded in the current period.

Earnings Per Share, Policy [Policy Text Block]

r

) Earnings per share

Historical basic per share data is based on the weighted average number of shares outstanding.

Historical diluted per share data is reconciled by adding to weighted average shares outstanding the dilutive impact of the exercise of outstanding stock options, stock-settled stock appreciation rights, and restricted stock.

Comprehensive Income, Policy [Policy Text Block]

s

) Comprehensive income

Other comprehensive income (loss) is defined as the change in equity during a period, from transactions and other events, excluding changes resulting from investments by owners (e.g., supplemental stock offering) and distributions to owners (e.g., dividends).

Segment Reporting, Policy [Policy Text Block]

t

) Operating segments

The Financial Accounting Standards Board (“

FASB”) establishes standards for the way that public companies report information about operating segments in annual financial statements and establishes standards for related disclosures about product and services, geographic areas and major customers. The Company has reviewed the standard and determined that it has

three

reportable segments, Uniforms and Related Products, Remote Staffing Solutions and Promotional Products.

Concentration Risk, Credit Risk, Policy [Policy Text Block]

u

)  Risks and concentrations

Financial instruments that potentially subject the Company to concentrations of credit risk include cash in banks in excess of federally insured amounts.

  The Company manages this risk by maintaining all deposits in high quality financial institutions and periodically performing evaluations of the relative credit standing of the financial institutions.

When assessing credit risk the Company considers whether the credit risk exists at both the individual and group level. Consideration is given to the activity, region and economic characteristics when assessing if there exists a group concentration risk. At

December 31, 2017

and

2016,

the Company had

no

customers with an accounts receivable balance greater than

11.3%

of the total accounts receivable. At

December 31, 2017

and

2016,

the top

five

accounts receivable customer balances totaled

$14.2

million and

$12.9

million, respectively, or approximately

28.0%

and

30.8%

of the respective total accounts receivable balances. The Company’s largest customer for each of the years ended

December 31, 2017,

2016,

and

2015

had net sales of approximately

$20.6

million,

$19.3

million and

$12.5

million, respectively, or approximately

7.7%,

7.6%

and

6.0%

of the respective total net sales for the Company. The Company’s

five

largest customers for the years ended

December 31, 2017,

2016

and

2015

had net sales of approximately

$50.7

million,

$57.6

million and

$48.9

million, respectively, or approximately

19.0%,

22.8%

and

23.3%

of the respective total net sales for the Company.   

Included in accounts receivable-other on the Company

’s consolidated balance sheets at

December 31, 2017

and

2016

are receivable balances from a supplier in Haiti totaling

$1.5

million and

$2.3

million, respectively.

In

201

7,

2016

and

2015,

approximately

28%,

31%

and

26%,

respectively, of our products for our Uniform and Related Products segment were sourced from or contained raw materials sourced from China. In

2017,

2016

and

2015,

approximately

32%,

32%

and

42%,

respectively, of our products for our Uniform and Related Products segment were obtained from suppliers located in Central America and Haiti. In

2017

and

2016,

approximately

67%

and

59%,

respectively, of our products for our Promotional Products segment were sourced from China. Any inability by the Company to continue to obtain its products from Central America and Haiti could significantly disrupt the Company’s business. Because the Company manufactures and sources products in Central America and Haiti, the Company is affected by economic conditions in those countries, including increased duties, possible employee turnover, labor unrest and lack of developed infrastructure.

Fair Value of Financial Instruments, Policy [Policy Text Block]

v

) Fair value of financial instruments

The carrying amounts of cash and cash equivalents, receivables and accounts payable approximated f

air value as of

December 31, 2017

and

2016,

because of the relatively short maturities of these instruments. The carrying amount of the Company’s long-term debt approximated fair value as the rates are adjustable based upon current market conditions.

Stock Split Policy [Policy Text Block]

w) Stock Split

On

December 29, 2014,

the Board of Directors declared a

2

-for-

1

stock split of the Company

’s common stock. The record date of the split was

January 12, 2015,

and the stock split became effective

February 4, 2015.

All share and per share information in these consolidated interim financial statements have been restated for all periods presented, giving retroactive effect to the stock split. The Company revised certain historical amounts when it recorded the

2

-for-

1

stock split. The amounts were immaterial and reclassified within shareholders’ equity between par value and additional paid in capital.

Use of Estimates, Policy [Policy Text Block]

x

) Use of estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ materially from those estimates.

New Accounting Pronouncements, Policy [Policy Text Block]

y) Recent Accounting Pronouncements

In

May 2014,

the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”)

No.

2014

-

09,

Revenue from Contracts with Customers (Topic

606

) that will supersede most current revenue recognition guidance, including industry-specific guidance. The core principle of the new guidance is that an entity will recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The standard provides a

five

-step analysis of transactions to determine when and how revenue is recognized. Other major provisions include the capitalization and amortization of certain contract costs, ensuring the time value of money is considered in the transaction price, and allowing estimates of variable consideration to be recognized before contingencies are resolved in certain circumstances. Additionally, the guidance requires disaggregated disclosures related to the nature, amount, timing, and uncertainty of revenue that is recognized. The amendments are required to be adopted by the Company on

January 1, 2018.

Transition to the new guidance

may

be done using either a full or modified retrospective method.

The Company will use the modified retrospective transition method with the cumulative effect recorded to the opening balance of retained earnings. The Company’s assessment of the new standard is substantially complete. The timing of revenue recognition is

not

expected to change for our Remote Staffing Solutions segment. For our Uniforms and Related Products and Promotional Products segments, our revenue is generated from the sale of finished products to customers as products are shipped and title passes to the customers. For certain contracts with customers, the Company creates an asset with

no

alternative use to the Company, and the Company has enforceable right to payment for performance completed to date. For these contracts, we expect to move from a point in time model for revenue recognition to an over time model. We expect this to have a material impact on the timing of our revenue recognition. As of

December 31, 2017

we estimate a net cumulative increase to retained earnings between

$10.0

million and

$15.0

million. We expect the new standard will have

no

cash impact and does

not

affect the economics our underlying customer contracts. We do

not

expect this new guidance to have any other material impacts on our Consolidated Financial Statements but will significantly expand our disclosures.

In

April 2015,

the FASB issued ASU

No.

2015

-

03

to simplify the presentation of debt issuance costs. The amendments in this ASU require debt issuance costs to be presented on the balance sheet as a reduction from the carrying amount of the related debt liability. The amendment in this ASU is to be applied retrospectively and is effective for interim and annual reporting periods beginning after

December 15, 2015.

The Company adopted this ASU retrospectively effective

January 1, 2016,

and has reclassified all debt issuance costs as a reduction from the carrying amount of the related debt liability for both the current and prior period. (See Note

6.

)

In

February 2016,

the FASB issued ASU

2016

-

02

that amends the accounting guidance on leases. The primary change in this ASU requires lessees to recognize, in the balance sheet, a liability to make lease payments and a right-of-use asset representing the right to use the underlying asset over the lease term. The amendments in this ASU are to be applied using a modified retrospective approach and are effective for fiscal years beginning after

December 15, 2018.

The Company is in the preliminary phases of assessing the effect of this ASU. We have

not

yet selected a transition date nor have we yet determined the effect of this ASU on our results of operations, financial condition, or cash flows.

In

March 2016,

the FASB issued ASU

2016

-

09,

“Compensation

– Stock Compensation (Topic

718

): Improvements to Employee Share-Based Payment Accounting”. This update was issued as part of FASB’s simplification initiative and affects all entities that issue share-based payment awards to their employees. The amendment requires that excess tax benefits for share-based payments be recorded as a reduction of income tax expense and reflected within operating cash flows rather than being recorded in paid-in-capital and reflected within financing cash flows. The standard also clarifies that all cash payments when directly withholding shares for tax-withholding purposes should be classified as a financing activity on the statement of cash flows and provides for an accounting policy election to account for forfeitures when they occur. The amendments in this update are effective for annual and interim periods beginning after

December 15, 2016.

Early adoption was permitted in any interim or annual period but must be reflected as of the beginning of the fiscal year. The Company elected to early adopt the standard in the

fourth

quarter of

2016

which required us to reflect the adjustments as of

January 1, 2016.

The recognition of excess tax benefits in our provision for income taxes rather than paid-in-capital resulted in an income tax benefit of for the years ended

December 31, 2017

and

December 31, 2016

of

$1.8

million or

$0.12

per share and

$0.9

million or

$0.06

per share, respectively. Lastly, the company has made an accounting policy election to account for forfeitures in compensation cost when they occur. There was

no

material impact of this election in fiscal

2017.

XML

Note 1 - Summary of Significant Accounting Policies (Tables)

12 Months Ended

Dec. 31, 2017

Notes Tables

Schedule of Finite-Lived Intangible Assets [Table Text Block]

	Customer Relationships			Weighted Average Life (years)		Non-Compete Agreemen t			Weighted Average Life (years )		Customer Backlo g			Weighted Average Life (years )
December 31, 201 7
Cos t	$	15,530			8.8	$	5,551			5.1	$	122			0.5
Accumulated amortizatio n		(4,782	)				(4,619	)				(10	)
Ne t	$	10,748				$	932				$	112
December 31, 201 6
Cos t	$	12,311			9.4	$	5,370			5.1	$	0			N/A
Accumulated amortizatio n		(4,490	)				(3,553	)				0
Ne t	$	7,821				$	1,817				$	0

XML

Note 2 - Allowance for Doubtful Accounts Receivable (Tables)

12 Months Ended

Dec. 31, 2017

Notes Tables

Allowance for Credit Losses on Financing Receivables [Table Text Block]

	201 7			201 6			201 5
Balance at the beginning of yea r	$	1,276		$	848		$	680
Provision for bad debt s		1,002			523			266
Charge-off s		(901	)		(96	)		(98	)
Recoverie s		5			1			-
Balance at the end of yea r	$	1,382		$	1,276		$	848

XML

Note 3 - Reserve for Sales Returns and Allowance (Tables)

12 Months Ended

Dec. 31, 2017

Notes Tables

Reserve for Sales Returns and Allowances [Table Text Block]

	201 7			201 6			201 5
Balance at the beginning of yea r	$	1,967		$	1,384		$	1,308
Provision for returns and allowance s		2,789			4,445			4,547
Actual returns and allowances paid to customer s		(3,631	)		(3,862	)		(4,471	)
Balance at the end of yea r	$	1,125		$	1,967		$	1,384

XML

Note 4 - Inventories (Tables)

12 Months Ended

Dec. 31, 2017

Notes Tables

Schedule of Inventory, Current [Table Text Block]

	December 31 ,
	201 7		201 6
Finished good s	$	54,354	$	57,887
Work in proces s		604		853
Raw material s		10,021		10,500
	$	64,979	$	69,240

XML

Note 5 - Property, Plant and Equipment (Tables)

12 Months Ended

Dec. 31, 2017

Notes Tables

Property, Plant and Equipment [Table Text Block]

	December 31 ,
	201 7			201 6
Lan d	$	3,635		$	4,485
Buildings, improvements and leasehold s		18,192			19,140
Machinery, equipment and fixture s		52,594			48,840
		74,421			72,465
Accumulated depreciation and amortizatio n		(47,577	)		(44,932	)
	$	26,844		$	27,533

XML

Note 6 - Long-term Debt (Tables)

12 Months Ended

Dec. 31, 2017

Notes Tables

Schedule of Long-term Debt Instruments [Table Text Block]

(In thousands )	December 31 ,		December 31 ,
	2017		2016
Term loan payable to Fifth Third Bank, pai d  February 28, 201 7	$	-	$	39,643
Note payable to Fifth Third Bank, pursuant to revolvin g credit agreement, paid February 28, 201 7	$	-	$	2,540
Note payable to BB&T, pursuant to revolvin g credit agreement, maturing February 25, 202 2	$	1,475	$	-
Term loan payable to BB& T maturing February 26, 202 4	$	37,500	$	-
	$	38,975	$	42,183
Less :
Payments due within one year include d in current liabilitie s	$	6,000	$	5,893
Debt issuance cost s	$	42	$	63
Long-term debt less current maturitie s	$	32,933	$	36,227

XML

Note 7 - Taxes on Income (Tables)

12 Months Ended

Dec. 31, 2017

Notes Tables

Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]

	201 7		201 6			201 5
Current:
Federa l	$	2,846	$	5,642		$	6,527
Tax Cut and Jobs Ac t		265		-			-
State and loca l		647		628			519
Foreig n		338		-			-
		4,096		6,270			7,046
Long Term :
Tax Cut and Jobs Ac t		1,336		-			-
Deferred Taxes :
Deferred tax provision (benefit )		1,899		(1,010	)		(1,216	)
Tax Cut and Jobs Act re-measuremen t		2,429		-			-
		4,328		(1,010	)		(1,216	)
	$	9,760	$	5,260		$	5,830

Schedule of Deferred Tax Assets and Liabilities [Table Text Block]

	2017			2016
Deferred income tax assets:
Pension accruals	$	2,606		$	3,581
Operating reserves and other accruals		2,174			3,656
Tax carrying value in excess of book basis of goodwill		866			1,377
Tax credits		255			99
Valuation allowance on tax credits		(255	)
Deferred income tax liabilities:
Book carrying value in excess of tax basis of property		(937	)		(827	)
Deferred expenses		(1,809	)		(1,086	)
Net deferred income tax asset	$	2,900		$	6,800

Schedule of Effective Income Tax Rate Reconciliation [Table Text Block]

	2017			2016			2015
Statutory Federal income tax rate		34.0	%		34.0	%		34.0	%
State and local income taxes, net of Federal income tax benefit		1.5			1.9			1.6
Effect of change in unrecognized tax benefit		-			-			(0.1	)
Current year untaxed foreign income		(6.5	)		(5.1	)		(6.0	)
Foreign Taxes		1.4			-			-
Non-deductible share-based employee compensation expense		1.1			1.2			1.3
Excess tax benefit from stock compensation		(7.2	)		(4.4	)		-
Federal tax credits		(0.5	)		(0.8	)		-
Tax Cut and Jobs Act deferred tax re-measurement		6.9			-			-
Tax on undistributed foreign earnings		2.9			-			-
Transition tax (repatriation)		5.9			-			-
Other items		(0.1	)		(0.4	)		0.1
Effective income tax rate		39.4	%		26.4	%		30.9	%

Summary of Income Tax Contingencies [Table Text Block]

(In thousands )
	201 7			201 6
Balance at January 1,	$	399		$	399
Additions based on tax positions related to the current yea r		59			55
Additions for tax positions of prior year s		-			4
Reductions due to lapse of statute of limitation s		(58	)		(59	)
Balance at December 31 ,	$	400		$	399

XML

Note 8 - Benefit Plans (Tables)

12 Months Ended

Dec. 31, 2017

Notes Tables

Schedule of Defined Benefit Plans Disclosures [Table Text Block]

(In thousands )	December 31,
	201 7			201 6
Changes in benefit obligatio n
Benefit obligation at beginning of yea r	$	25,258		$	24,790
Service cos t		65			57
Interest cos t		965			988
Actuarial los s		3,755			1,288
Benefits pai d		(1,657	)		(1,865	)
Benefit obligation at end of yea r		28,386			25,258
Changes in plan asset s
Fair value of plan assets at beginning of yea r		15,791			15,865
Actual return on asset s		2,413			1,291
Employer contribution s		5,598			500
Benefits pai d		(1,657	)		(1,865	)
Fair value of plan assets at end of yea r		22,145			15,791
Funded status at end of yea r	$	(6,241	)	$	(9,467	)
Amounts recognized in consolidated balance sheet
Other asset s	$	2,181		$	-
Other current liabilitie s		(103	)		-
Long-term pension liabilit y		(8,319	)		(9,467	)
		(6,241	)		(9,467	)
Amounts recognized in accumulated other comprehensive income consist of :
Net actuarial los s	$	10,903		$	9,819

Schedule of Accumulated Benefit Obligations in Excess of Fair Value of Plan Assets [Table Text Block]

	December 31 ,
	201 7			201 6
Projected benefit obligatio n	$	28,386		$	25,258
Fair value of plan asset s		(22,145	)		(15,791	)
	$	6,241		$	9,467

Schedule of Net Benefit Costs [Table Text Block]

	201 7			201 6			201 5
Service cost - benefits earned during the perio d	$	65		$	57		$	48
Interest cost on projected benefit obligatio n		965			988			951
Expected return on plan asset s		(1,218	)		(1,188	)		(1,343	)
Recognized actuarial los s		1,042			1,027			772
Settlement los s		435			445			460
Net periodic pension cost after settlement s	$	1,289		$	1,329		$	888

Schedule of Assumptions Used [Table Text Block]

							Long Term Rat e
	Discount Rate						of Retur n						Salary Scale
	Corp.			Plants			Corp.			Plants			Corp.		Plants
2016		4.04	%		3.91	%		8.00	%		8.00	%		N/A		N/A
2017		3.53	%		3.45	%		8.00	%		8.00	%		N/A		N/A

							Long Term Rate
	Discount Rate						of Retur n						Salary Scale
	Corp.			Plants			Corp.			Plant s			Corp.		Plants
2015		3.86	%		3.74	%		8.00	%		8.00	%		N/A		N/A
2016		4.19	%		4.09	%		8.00	%		8.00	%		N/A		N/A
2017		4.04	%		3.91	%		8.00	%		8.00	%		N/A		N/A

Schedule of Allocation of Plan Assets [Table Text Block]

	Percentage of Plan Assets at December 31,						Target Allocation
Investment description	201 7			201 6			201 8
Equity securities		52	%		68	%		52	%
Fixed income		29	%		13	%		29	%
Other		19	%		19	%		19	%
Total		100	%		100	%		100	%

Schedule of Expected Benefit Payments [Table Text Block]

Year	Projected Benefit Payments
	(in thousands)
2018	$	1,467
2019	$	1,652
2020	$	2,135
2021	$	1,947
2022	$	1,979
202 3-2027	$	8,620

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Note 9 - Quarterly Results for 2015, 2016 and 2017 (Unaudited) (Tables)

12 Months Ended

Dec. 31, 2017

Notes Tables

Quarterly Financial Information [Table Text Block]

	Quarter Ende d
	March 31 ,		June 30 ,		September 30 ,		December 31 ,
	201 7		201 7		201 7		201 7
Net sale s	$	60,987	$	65,604	$	67,773	$	72,450
Gross profi t	$	22,214	$	23,374	$	24,789	$	25,975
Income before taxes on incom e	$	5,405	$	5,701	$	6,842	$	6,834
Net incom e	$	3,835	$	4,341	$	4,962	$	1,884
Per Share Data :
Basi c
Net earnings	$	0.27	$	0.30	$	0.34	$	0.13
Dilute d
Net earnings	$	0.26	$	0.29	$	0.33	$	0.12
Average Outstanding Shares (Basic )		14,350,721		14,501,399		14,573,813		14,614,691
Average Outstanding Shares (Diluted )		14,929,695		15,040,431		15,229,722		15,275,222

	Quarter Ende d
	March 31 ,		June 30 ,		September 30 ,		December 31 ,
	201 6		201 6		201 6		201 6
	(restated )		(restated )		(restated )
Net sale s	$	57,968	$	64,660	$	65,282	$	64,686
Gross profi t	$	20,021	$	21,763	$	23,140	$	22,058
Income before taxes on incom e	$	3,410	$	4,615	$	6,006	$	5,867
Net incom e	$	2,442	$	3,308	$	4,447	$	4,441
Per Share Data :
Basi c
Net earnings	$	0.18	$	0.23	$	0.31	$	0.31
Dilute d
Net earnings	$	0.17	$	0.22	$	0.30	$	0.30
Average Outstanding Shares (Basic )		13,927,063		14,120,617		14,118,354		14,162,939
Average Outstanding Shares (Diluted )		14,668,658		14,957,469		14,984,084		14,979,746

	Quarter Ende d
	March 31 ,		June 30 ,		September 30 ,		December 31 ,
	201 5		201 5		201 5		201 5
Net sale s	$	46,347	$	54,116	$	56,662	$	53,192
Gross profi t	$	15,796	$	18,531	$	19,224	$	17,882
Income before taxes on incom e	$	3,223	$	5,394	$	5,581	$	4,698
Net incom e	$	2,043	$	3,624	$	4,031	$	3,368
Per Share Data :
Basi c
Net earnings	$	0.15	$	0.26	$	0.29	$	0.24
Dilute d
Net earnings	$	0.14	$	0.25	$	0.28	$	0.23
Average Outstanding Shares (Basic )		13,584,922		13,730,646		13,833,561		13,894,907
Average Outstanding Shares (Diluted )		14,548,084		14,577,342		14,585,688		14,603,464

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Note 12 - Share-based Compensation (Tables)

12 Months Ended

Dec. 31, 2017

Notes Tables

Schedule of Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Table Text Block]

	Year Ended December 31 ,
	(In thousands )
	201 7		201 6		201 5
Stock options and SAR S	$	1,093	$	1,071	$	1,079
Restricted stoc k		331		317		282
Performance share s		240		250		-
Total share-based compensation expens e	$	1,664	$	1,638	$	1,361
Related income tax benefi t	$	229	$	325	$	203

Share-based Compensation, Stock Options, Activity [Table Text Block]

	No. o f			Weighted Averag e
	Share s			Exercise Pric e
Outstanding December 31, 201 5		946,546		$	8.39
Grante d		172,862			16.53
Exercise d		(279,766	)		7.31
Lapse d		(11,131	)		5.92
Cancelle d		(3,260	)		17.53
Outstanding December 31, 201 6		825,251		$	10.46
Grante d		155,142		$	18.67
Exercise d		(336,726	)		8.71
Lapse d		(1,100	)		5.86
Cancelle d		(8,690	)		15.82
Outstanding December 31, 201 7		633,877		$	13.33

Schedule of Share-based Compensation, Shares Authorized under Stock Option Plans, by Exercise Price Range [Table Text Block]

Range o f					Weighted Average Remainin g		Weighted Averag e
Exercise Pric e			Share s		Contractual Life (Years )		Exercise Pric e
$3.82	-	$5.5 5		59,000		2.08	$	4.81
$5.65	-	$7.3 6		151,995		1.96	$	6.65
$7.96	-	$10.3 8		45,100		4.53	$	8.87
$16.35	-	$21.6 3		377,782		4.79	$	17.88
$3.82	-	$21.6 3		633,877		3.84	$	13.33

Schedule of Share-based Compensation, Stock Appreciation Rights Award Activity [Table Text Block]

	No. o f			Weighted Averag e
	Share s			Exercise Pric e
Outstanding December 31, 201 5		381,566		$	8.14
Grante d		58,108			16.35
Exercise d		(114,168	)		6.27
Lapse d		-			-
Cancelle d		-			-
Outstanding December 31, 201 6		325,506		$	10.26
Grante d		43,988			16.97
Exercise d		(222,990	)		6.90
Lapse d		-
Cancelle d		-
Outstanding December 31, 201 7		146,504		$	17.38

Share-based Compensation, Activity [Table Text Block]

Range o f					Weighted Average Remainin g		Weighted Averag e
Exercise Pric e			SAR S		Contractual Life (Years )		Exercise Pric e
$16.35	-	$18.66		146,504		2.92	$	17.38

Schedule of Share-based Payment Award, Stock Options, Valuation Assumptions [Table Text Block]

Years ende d
December 31 ,	SAR S	Option s
Exercise pric e
201 7	$16.97	$16.97	-	$21.6 3
201 6	$16.35	$16.35	-	$18.5 5
201 5	$18.66	$16.78	-	$18.6 6
Market pric e
201 7	$16.97	$16.97	-	$21.6 3
201 6	$16.35	$16.35	-	$18.5 5
201 5	$18.66	$16.78	-	$18.6 6
Risk free interest rate 1
201 7	1.9%	1.8%	-	2.4%
201 6	1.3%	1.1%	-	1.8%
201 5	1.5%	1.5%	-	2.1%
Expected award life (years) 2	5	5	-	10
Expected volatility 3
201 7	36.6%	36.6%	-	41.4%
201 6	36.5%	36.5%	-	40.3%
201 5	34.9%	34.9%	-	39.0%
Expected dividend yield 4
201 7	2.1%	1.8%	-	2.1%
201 6	2.0%	1.8%	-	2.1%
201 5	1.6%	1.6%	-	1.9%

Schedule of Share-based Compensation, Restricted Stock and Restricted Stock Units Activity [Table Text Block]

	No. o f			Weighted Averag e
	Share s			Grant Date Fair Valu e
Outstanding December 31, 201 5		114,342		$	8.39
Grante d		10,396			16.35
Veste d		-			-
Forfeite d		(1,050	)		21.92
Outstanding December 31, 201 6		123,688		$	8.94
Grante d		43,706			18.30
Veste d		(106,016	)		7.62
Forfeite d		-			-
Outstanding December 31, 201 7		61,378		$	17.89

Schedule of Nonvested Performance-based Units Activity [Table Text Block]

	No. o f			Weighted Averag e
	Share s			Grant Date Fair Valu e
Outstanding December 31, 201 6		101,000		$	16.36
Grante d		50,826			18.39
Veste d		-			-
Forfeite d		(33,334	)		16.35
Outstanding December 31, 201 7		118,492		$	17.24

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Note 13 - Earnings Per Share (Tables)

12 Months Ended

Dec. 31, 2017

Notes Tables

Schedule of Earnings Per Share, Basic and Diluted [Table Text Block]

	201 7		201 6		201 5
Net earnings used in the computation of basic an d diluted earnings per share (in thousands )	$	15,022	$	14,638	$	13,066
Weighted average share s outstanding - basi c		14,510,156		14,082,243		13,761,009
Common stock equivalent s		608,612		815,246		817,635
Total weighted average share s outstanding - diluted		15,118,768		14,897,489		14,578,644
Per Share Data :
Basi c
Net earning s	$	1.04	$	1.04	$	0.95
Dilute d
Net earning s	$	0.99	$	0.98	$	0.90

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Note 14 - Other Current Liabilities (Tables)

12 Months Ended

Dec. 31, 2017

Notes Tables

Schedule of Accounts Payable and Accrued Liabilities [Table Text Block]

	Year Ended December 31 ,
	201 7		201 6
Salaries, wages, commissions and vacation pay	$	7,851	$	5,600
Accrued rebate s		1,089		1,932
Defined contribution plan accrua l		104		897
Customer deposit s		473		670
Other accrued expenses		2,892		1,617
	$	12,409	$	10,716

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Note 15 - Supplemental Cash Flow Information (Tables)

12 Months Ended

Dec. 31, 2017

Notes Tables

Schedule of Cash Flow, Supplemental Disclosures [Table Text Block]

	Year Ended December 31,
	201 7		201 6		201 5
Income taxes pai d	$	7,173	$	5,076	$	6,897
Interest pai d	$	727	$	694	$	523

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Note 17 - Operating Segment Information (Tables)

12 Months Ended

Dec. 31, 2017

Notes Tables

Schedule of Segment Reporting Information, by Segment [Table Text Block]

(In thousands )
	Uniforms and Related Product s			Remote Staffing Solution s		Promotional Product s		Intersegment Elimination s			Tota l
Twelve Months Ende d
December 31, 201 7
Net sale s	$	204,644		$	23,021	$	42,904	$	(3,755	)	$	266,814
Gross margi n	$	72,463		$	12,460	$	13,860	$	(2,431	)	$	96,352
Selling and administrative expense s		54,191			7,877		12,179		(2,431	)		71,816
Gain (loss) on sale of property, plant and equipmen t		(2	)		1,050		-		-			1,048
Interest expens e		387			-		415		-			802
Income before taxes on incom e	$	17,883		$	5,633	$	1,266	$	-		$	24,782
Depreciation and amortizatio n	$	4,223		$	846	$	584	$	-		$	5,653
Capital expenditure s	$	2,870		$	1,156	$	219	$	-		$	4,245
Total asset s	$	182,623		$	21,846	$	54,997	$	(40,528	)	$	218,938

	Uniforms and Related Product s		Remote Staffing Solution s		Promotional Product s			Intersegment Elimination s			Tota l
Twelve Months Ende d
December 31, 201 6
Net sale s	$	210,373	$	17,953	$	27,816		$	(3,546	)	$	252,596
Gross margi n	$	69,987	$	9,616	$	9,690		$	(2,311	)	$	86,982
Selling and administrative expense s		52,225		6,096		10,386			(2,311	)		66,396
Interest expens e		462		-		226			-			688
Income before taxes on income (loss )	$	17,300	$	3,520	$	(922	)	$	-		$	19,898
Depreciation and amortizatio n	$	4,023	$	494	$	418		$	-		$	4,935
Capital expenditure s	$	3,383	$	3,872	$	130		$	-		$	7,385
Total asset s	$	176,070	$	19,752	$	28,480		$	(27,454	)	$	196,848

	Uniforms and Related Product s		Remote Staffing Solution s		Promotional Product s		Intersegment Elimination s			Tota l
Twelve Months Ende d
December 31, 201 5
Net sale s	$	198,319	$	15,604	$	-	$	(3,606	)	$	210,317
Gross margi n	$	65,247	$	8,579	$	-	$	(2,393	)	$	71,433
Selling and administrative expense s		49,225		5,186		-		(2,393	)		52,018
Interest expens e		519		-		-		-			519
Income before taxes on incom e	$	15,503	$	3,393	$	-	$	-		$	18,896
Depreciation and amortizatio n	$	3,561	$	312	$	-	$	-		$	3,873
Capital expenditure s	$	3,003	$	5,066	$	-	$	-		$	8,069
Total asset s	$	140,710	$	14,551	$	-	$	(3,530	)	$	151,731

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Note 18 - Acquisition of Business (Tables)

12 Months Ended

Dec. 31, 2017

Notes Tables

Schedule of Business Acquisitions, by Acquisition [Table Text Block]

A Summary of the purchase price is as follows (in thousands) :
Cash consideration at closing, net of cash acquire d	$	15,161
Restricted shares of Superior common stock issue d		4,558
Contingent consideratio n		5,205
Total Consideration s	$	24,924

A Summary of the purchase price is as follows (in thousands) :
Cash consideration at closin g	$	7,222
Restricted shares of Superior common stock issue d		1,657
Contingent consideratio n		3,209
Total Consideration s	$	12,088

Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block]

Accounts receivabl e	$	4,885
Prepaid expenses and other current asset s		3,200
Inventorie s		236
Property, plant and equipmen t		199
Other Asset s		100
Identifiable intangible asset s		11,360
Goodwil l		6,994
Total asset s	$	26,974
Accounts Payable s		1,314
Other current liabilitie s		736
Total liabilitie s	$	2,050

Accounts receivabl e	$	5,051
Prepaid expenses and other current asset s		969
Property, plant and equipmen t		131
Identifiable intangible asset s		6,495
Goodwil l		4,169
Total asset s	$	16,815
Accounts Payable s		3,374
Other current liabilitie s		1,353
Total liabilitie s	$	4,727

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Note 1 - Summary of Significant Accounting Policies (Details Textual)		1 Months Ended	3 Months Ended												12 Months Ended
	Dec. 29, 2014	Dec. 31, 2017 USD ($) shares	Dec. 31, 2017 USD ($) shares	Sep. 30, 2017 USD ($)	Jun. 30, 2017 USD ($)	Mar. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)	Sep. 30, 2016 USD ($)	Jun. 30, 2016 USD ($)	Mar. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)	Sep. 30, 2015 USD ($)	Jun. 30, 2015 USD ($)	Mar. 31, 2015 USD ($)	Dec. 31, 2018 USD ($)	Dec. 31, 2017 USD ($) $ / shares shares	Dec. 31, 2016 USD ($) $ / shares	Dec. 31, 2015 USD ($)	Dec. 01, 2017 USD ($)	Aug. 21, 2017 USD ($)	Mar. 08, 2016 USD ($)	Dec. 31, 2013 USD ($)
Subsidiary of Limited Liability Company or Limited Partnership, Ownership Interest																99.00%
Advertising Expense																$ 100,000	$ 100,000	$ 100,000
Goodwill		$ 16,032,000	$ 16,032,000				$ 11,269,000									16,032,000	11,269,000
Amortization of Intangible Assets																2,400,000	2,300,000	2,100,000
Finite-Lived Intangible Assets, Amortization Expense, Next Twelve Months		2,500,000	2,500,000													2,500,000
Finite-Lived Intangible Assets, Amortization Expense, Year Two		1,900,000	1,900,000													1,900,000
Finite-Lived Intangible Assets, Amortization Expense, Year Three		1,900,000	1,900,000													1,900,000
Finite-Lived Intangible Assets, Amortization Expense, Year Four		1,900,000	1,900,000													1,900,000
Finite-Lived Intangible Assets, Amortization Expense, Year Five		1,800,000	1,800,000													1,800,000
Finite-lived Intangible Assets Amortization Expense Year Six		1,100,000	1,100,000													1,100,000
Finite Lived Intangible Assets Amortization Expense Year Seven		$ 500,000	$ 500,000													$ 500,000
Pension Plan Prior Service Costs Amortization Term																20 years
Impairment of Long-Lived Assets Held-for-use																$ 0	0	0
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | shares		3,667,577	3,667,577													3,667,577
Number of Reportable Segments																3
Revenue, Net			$ 72,450,000	$ 67,773,000	$ 65,604,000	$ 60,987,000	64,686,000	$ 65,282,000	$ 64,660,000	$ 57,968,000	$ 53,192,000	$ 56,662,000	$ 54,116,000	$ 46,347,000
Other Receivables		$ 1,848,000	$ 1,848,000				3,085,000									$ 1,848,000	3,085,000
Reclassification from APIC to Income Tax Expense [Member]
Current Period Reclassification Adjustment																$ 1,800,000	$ 900,000
Current Period Reclassification Adjustment, Per Share | $ / shares																$ 0.12	$ 0.06
Stock Split from [Member]
Stockholders' Equity Note, Stock Split, Conversion Ratio	2
Minimum [Member] | Accounting Standards Update 2014-09 [Member] | Scenario, Forecast [Member]
Cumulative Effect on Retained Earnings, Net of Tax															$ 10,000,000
Minimum [Member] | Building [Member]
Property Plant and Equipment Depreciation Straight Line Percentage		2.50%	2.50%													2.50%
Minimum [Member] | Building Improvements [Member]
Property Plant and Equipment Depreciation Straight Line Percentage		2.50%	2.50%													2.50%
Minimum [Member] | Machinery, Equipment and Fixtures [Member]
Property Plant and Equipment Depreciation Straight Line Percentage		10.00%	10.00%													10.00%
Minimum [Member] | Transportation Equipment [Member]
Property Plant and Equipment Depreciation Straight Line Percentage		20.00%	20.00%													20.00%
Maximum [Member] | Accounting Standards Update 2014-09 [Member] | Scenario, Forecast [Member]
Cumulative Effect on Retained Earnings, Net of Tax															$ 15,000,000
Maximum [Member] | Building [Member]
Property Plant and Equipment Depreciation Straight Line Percentage		5.00%	5.00%													5.00%
Maximum [Member] | Building Improvements [Member]
Property Plant and Equipment Depreciation Straight Line Percentage		20.00%	20.00%													20.00%
Maximum [Member] | Machinery, Equipment and Fixtures [Member]
Property Plant and Equipment Depreciation Straight Line Percentage		33.33%	33.33%													33.33%
Maximum [Member] | Transportation Equipment [Member]
Property Plant and Equipment Depreciation Straight Line Percentage		33.33%	33.33%													33.33%
HPI [Member] | Trade Names [Member]
Indefinite-lived Intangible Assets (Excluding Goodwill), Fair Value Disclosure																						$ 4,700,000
BAMKO [Member]
Goodwill																					$ 6,994,000
Amortization of Intangible Assets																$ 400,000	$ 300,000
BAMKO [Member] | Trade Names [Member]
Indefinite-lived Intangible Assets (Excluding Goodwill), Fair Value Disclosure							8,900,000										8,900,000
Public Identity [Member]
Goodwill																				$ 600,000
Public Identity [Member] | Trade Names [Member]
Indefinite-lived Intangible Assets (Excluding Goodwill), Fair Value Disclosure		$ 500,000	$ 500,000													500,000
Tangerine [Member]
Goodwill																			$ 4,169,000
Amortization of Intangible Assets		100,000
Tangerine [Member] | Trade Names [Member]
Indefinite-lived Intangible Assets (Excluding Goodwill), Fair Value Disclosure		3,200,000	3,200,000													3,200,000
Uniforms and Related Products [Member]
Goodwill		4,100,000	4,100,000													4,100,000
Promotional Products Segment [Member]
Goodwill		11,900,000	11,900,000													11,900,000
Selling, General and Administrative Expenses [Member]
Shipping, Handling and Transportation Costs																$ 10,900,000	10,600,000	$ 9,300,000
Product Concentration Risk [Member] | Sales Revenue, Net [Member] | Uniforms and Related Products [Member]
Concentration Risk, Percentage																95.00%
Customer Concentration Risk [Member] | Largest [Member]
Other Receivables		1,500,000	1,500,000				2,300,000									$ 1,500,000	$ 2,300,000
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | Five Largest [Member]
Concentration Risk, Percentage																19.00%	22.80%	23.30%
Revenue, Net																$ 50,700,000	$ 57,600,000	$ 48,900,000
Customer Concentration Risk [Member] | Sales Revenue, Net [Member] | Largest [Member]
Concentration Risk, Percentage																7.70%	7.60%	6.00%
Revenue, Net																$ 20,600,000	$ 19,300,000	$ 12,500,000
Customer Concentration Risk [Member] | Accounts Receivable [Member]
Concentration Risk, Percentage																11.30%	11.30%
Customer Concentration Risk [Member] | Accounts Receivable [Member] | Five Largest [Member]
Concentration Risk, Percentage																28.00%	30.80%
Accounts Receivable, Net		$ 14,200,000	$ 14,200,000				$ 12,900,000									$ 14,200,000	$ 12,900,000
Supplier Concentration Risk [Member] | Uniforms and Related Products [Member] | CHINA
Concentration Risk, Percentage																28.00%	31.00%	26.00%
Supplier Concentration Risk [Member] | Uniforms and Related Products [Member] | Central America [Member]
Concentration Risk, Percentage																32.00%	32.00%	42.00%
Supplier Concentration Risk [Member] | Promotional Products Segment [Member] | CHINA
Concentration Risk, Percentage																67.00%	59.00%

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Note 1 - Summary of Significant Accounting Policies - Intangible Assets (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Customer Relationships [Member]
Cost	$ 15,530	$ 12,311
Weighted average life (Year)	8 years 292 days	9 years 146 days
Accumulated amortization	$ (4,782)	$ (4,490)
Net	10,748	7,821
Noncompete Agreements [Member]
Cost	$ 5,551	$ 5,370
Weighted average life (Year)	5 years 36 days	5 years 36 days
Accumulated amortization	$ (4,619)	$ (3,553)
Net	932	1,817
Customer Backlog [Member]
Cost	$ 122	0
Weighted average life (Year)	182 days
Accumulated amortization	$ (10)	0
Net	$ 112	$ 0

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Note 2 - Allowance for Doubtful Accounts Receivable - Allowance for Doubtful Accounts Receivable (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Balance at the beginning of year	$ 1,276	$ 848	$ 680
Provision for bad debts - accounts receivable	1,002	512	266
Charge-offs	(901)	(96)	(98)
Recoveries	5	1
Balance at the end of year	$ 1,382	$ 1,276	$ 848

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Note 3 - Reserve for Sales Returns and Allownace - Reserve for Sales Returns and Allowances (Details) - Allowance for Sales Returns [Member] - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Balance at the beginning of year	$ 1,967	$ 1,384	$ 1,308
Provision for returns and allowances	2,789	4,445	4,547
Actual returns and allowances paid to customers	(3,631)	(3,862)	(4,471)
Balance at the end of year	$ 1,125	$ 1,967	$ 1,384

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Note 4 - Inventories - Inventories (Details) - USD ($) $ in Thousands		Dec. 31, 2017	Dec. 31, 2016
Finished goods		$ 54,354	$ 57,887
Work in process		604	853
Raw materials		10,021	10,500
	[1]	$ 64,979	$ 69,240

[1] Inventories consist of the following: September 30, 2017 December 31, (Unaudited) 2016 Finished goods $ 54,904,000 $ 57,887,000 Work in process 690,000 853,000 Raw materials 10,366,000 10,500,000

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Note 5 - Property, Plant and Equipment (Details Textual) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Depreciation, Depletion and Amortization, Nonproduction	$ 5,653	$ 4,935	$ 3,873
Property, Plant and Equipment [Member]
Depreciation, Depletion and Amortization, Nonproduction	$ 3,300	$ 2,600	$ 1,800

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Note 5 - Property, Plant and Equipment - Summary of Property, Plant and Equipment (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Property, plant and equipment, gross	$ 74,421	$ 72,465
Accumulated depreciation and amortization	(47,577)	(44,932)
	26,844	27,533
Land [Member]
Property, plant and equipment, gross	3,635	4,485
Buildings Improvements and Leaseholds [Member]
Property, plant and equipment, gross	18,192	19,140
Machinery, Equipment and Fixtures [Member]
Property, plant and equipment, gross	$ 52,594	$ 48,840

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Note 6 - Long-term Debt (Details Textual) $ in Thousands							12 Months Ended
	Jul. 01, 2018 USD ($)	Feb. 28, 2017 USD ($)	Feb. 24, 2017 USD ($)	Mar. 08, 2016 USD ($)	Jul. 01, 2014 USD ($)	Jul. 01, 2013 USD ($)	Dec. 31, 2017 USD ($)	Mar. 01, 2018 USD ($)
Long-term Debt, Maturities, Repayments of Principal in Next Twelve Months							$ 6,000
Long-term Debt, Maturities, Repayments of Principal in Year Two							6,000
Long-term Debt, Maturities, Repayments of Principal in Year Three							6,000
Long-term Debt, Maturities, Repayments of Principal in Year Four							6,000
Long-term Debt, Maturities, Repayments of Principal in Year Five							6,000
Long Term Debt Maturities Repayments of Principal in Year Six							6,000
Long Term Debt Maturities Repayments of Principal in Year Seven							1,500
Debt Issuance Costs, Gross							$ 100
Ratio of Maximum Funded Indebtedness to EBITDA							4
Fixed Charges Numerator							1.25
Derivative, Fixed Interest Rate				243.00%	253.00%
Derivative, Notional Amount					$ 14,300
Per Month through July 1, 2015 [Member]
Debt Instrument, Periodic Payment, Principal					200
Per Month through June 1, 2018 [Member]
Debt Instrument, Periodic Payment, Principal					$ 300
Interest Rate Swap [Member]
Derivative Instruments, Gain Reclassified from Accumulated OCI into Income, Effective Portion			$ 100
Interest Rate Swap [Member] | Other Current Liabilities [Member]
Derivative Liability							$ 100
Amended Credit Agreement [Member] | Term Loan [Member]
Debt Instrument, Face Amount		$ 42,000		$ 45,000		$ 30,000
Amended Credit Agreement [Member] | Term Loan [Member] | London Interbank Offered Rate (LIBOR) [Member]
Debt Instrument, Basis Spread on Variable Rate				0.85%
Scenario, Forecast [Member]
Derivative, Fixed Interest Rate								3.12%
Debt Instrument, Periodic Payment, Principal	$ 3,300
Scenario, Forecast [Member] | Interest Rate Swap [Member]
Derivative, Notional Amount								$ 18,000
Derivative, Notional Amount, Monthly Reduction Amount								$ 300
Revolving Credit Facility [Member] | Amended Credit Agreement [Member]
Line of Credit Facility, Expiration Period		7 years				5 years
Line of Credit Facility, Maximum Borrowing Capacity		$ 35,000		$ 20,000		$ 15,000
Line of Credit Facility, Commitment Fee Percentage							0.10%
Long-term Line of Credit							$ 0
Letters of Credit Outstanding, Amount							$ 0
Add on Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member]
Debt Instrument, Basis Spread on Variable Rate		0.75%		0.85%
Debt Instrument, Interest Rate, Stated Percentage							2.25%

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Note 6 - Long-term Debt - Long-term Debt (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Long-term debt, gross	$ 38,975	$ 42,183
Payments due within one year included in current liabilities	6,000	5,893
Debt issuance costs	42	63
Long-term debt less current maturities	32,933	36,227
Term Loan Paid February 28, 2017 [Member] | Fifth Third Bank [Member]
Long-term debt, gross		39,643
Note Payable Paid February 28, 2017 [Member] | Fifth Third Bank [Member]
Long-term debt, gross		2,540
Note Payable Maturing February 25, 2022 [Member] | BB&T [Member]
Long-term debt, gross	1,475
Term Loan Maturing February 26, 2024 [Member] | BB&T [Member]
Long-term debt, gross	$ 37,500

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Note 7 - Taxes on Income (Details Textual) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2018	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent			34.00%	34.00%	34.00%
Income Tax Expense (Benefit)	$ 5,000		$ 9,760	$ 5,260	$ 5,830
Tax Adjustments, Settlements, and Unusual Provisions	4,000		4,000
Net Discrete Tax Adjustment, Tax Act			3,300
Net Discrete Tax Adjustment, Other Miscellaneous Discrete Items			700
Income Tax Expense (Benefit), Continuing Operations, Adjustment of Deferred Tax (Asset) Liability			$ 1,700
Accumulated Foreign Earnings and Profits Tax Rate, Liquid Assets			15.50%
Accumulated Foreign Earnings and Profits Tax Rate, Unremitted Foreign E&P			8.00%
Income Tax Expense (Benefit), Transition Tax, Net			$ 1,500
Unrecognized Tax Benefits, Income Tax Penalties and Interest Expense			100	100	100
Unrecognized Tax Benefits, Reduction Resulting from Lapse of Applicable Statute of Limitations			100	100	$ 100
Unrecognized Tax Benefits, Income Tax Penalties and Interest Accrued	100		100	100
Significant Change in Unrecognized Tax Benefits is Reasonably Possible, Amount of Unrecorded Benefit	100		$ 100
Domestic Tax Authority [Member] | Earliest Tax Year [Member]
Open Tax Year			2015
State and Local Jurisdiction [Member] | Earliest Tax Year [Member]
Open Tax Year			2011
Other Noncurrent Liabilities [Member]
Unrecognized Tax Benefits that Would Impact Effective Tax Rate	$ 500		$ 500	$ 500
Scenario, Forecast [Member]
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent		21.00%

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Note 7 - Taxes on Income - Income Tax Provisions (Details) - USD ($) $ in Thousands	3 Months Ended	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Current:
Federal		$ 2,846	$ 5,642	$ 6,527
Tax Cut and Jobs Act		265
State and local		647	628	519
Foreign		338
		4,096	6,270	7,046
Tax Cut and Jobs Act		1,336
Deferred Taxes:
Deferred tax provision (benefit)		1,899	(1,010)	(1,216)
Tax Cut and Jobs Act re-measurement		2,429
		4,328	(1,010)	(1,216)
	$ 5,000	$ 9,760	$ 5,260	$ 5,830

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Note 7 - Taxes on Income - Deferred Income Tax Asset (Liability) (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Deferred income tax assets:
Pension accruals	$ 2,606	$ 3,581
Operating reserves and other accruals	2,174	3,656
Tax carrying value in excess of book basis of goodwill	866	1,377
Tax credits	255	99
Valuation allowance on tax credits	(255)
Deferred income tax liabilities:
Book carrying value in excess of tax basis of property	(937)	(827)
Deferred expenses	(1,809)	(1,086)
Net deferred income tax asset	$ 2,900	$ 6,800

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Note 7 - Taxes on Income - Income Tax Rate Reconciliation (Details)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Statutory Federal income tax rate	34.00%	34.00%	34.00%
State and local income taxes, net of Federal income tax benefit	1.50%	1.90%	1.60%
Effect of change in unrecognized tax benefit			(0.10%)
Current year untaxed foreign income	(6.50%)	(5.10%)	(6.00%)
Foreign Taxes	1.40%
Non-deductible share-based employee compensation expense	1.10%	1.20%	1.30%
Excess tax benefit from stock compensation	(7.20%)	(4.40%)
Federal tax credits	(0.50%)	(0.80%)
Tax Cut and Jobs Act deferred tax re-measurement	6.90%
Tax on undistributed foreign earnings	2.90%
Transition tax (repatriation)	5.90%
Other items	(0.10%)	(0.40%)	0.10%
Effective income tax rate	39.40%	26.40%	30.90%

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Note 7 - Taxes on Income - Unrecognized Tax Benefits (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Reductions due to lapse of statute of limitations	$ (100)	$ (100)	$ (100)
Excluding Interest and Penalties [Member]
Balance at January 1,	399	399
Additions based on tax positions related to the current year	59	55
Additions for tax positions of prior years		4
Reductions due to lapse of statute of limitations	(58)	(59)
Balance at December 31,	$ 400	$ 399	$ 399

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Note 8 - Benefit Plans (Details Textual) $ in Thousands	12 Months Ended
	Dec. 31, 2017 USD ($)	Dec. 31, 2016 USD ($)	Dec. 31, 2015 USD ($)
Defined Benefit Plans Number of Plans	2
Defined Benefit Plans Retirement Age	65 years
Defined Benefit Plan, Funded (Unfunded) Status of Plan	$ (6,241)	$ (9,467)
Other Assets [Member] | Nonqualified Plan [Member]
Cash Surrender Value of Life Insurance	2,200
Other Noncurrent Liabilities [Member] | Nonqualified Plan [Member]
Deferred Compensation Liability, Classified, Noncurrent	2,200
Supplemental Employee Retirement Plan [Member]
Defined Benefit Plan, Funded (Unfunded) Status of Plan	(8,400)
Pension Plan [Member]
Defined Benefit Plan, Funded (Unfunded) Status of Plan	2,200
Defined Benefit Plan, Expected Amortization, Next Fiscal Year	(1,100)
Defined Benefit Plan, Expected Future Employer Contributions, Next Fiscal Year	100
Postretirement Life Insurance [Member]
Cash Surrender Value of Life Insurance	2,200
Postretirement Life Insurance [Member] | Life Insurance Contracts [Member]
Gain (Loss) on Investments	300
401(K) Plan [Member}
Defined Contribution Plan, Employer Matching Contribution, Percent of Match		25.00%
Defined Contribution Plan, Employer Discretionary Contribution, Percent		3.00%
Defined Contribution Plan, Employer Discretionary Contribution Amount	$ 1,000	$ 1,100	$ 900

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Note 8 - Benefit Plans - Defined Benefit Plans Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Changes in benefit obligation
Benefit obligation at beginning of year	$ 25,258	$ 24,790
Service cost - benefits earned during the period	65	57	$ 48
Interest cost on projected benefit obligation	965	988	951
Recognized actuarial loss	3,755	1,288
Benefits paid	(1,657)	(1,865)
Benefit obligation at end of year	28,386	25,258	24,790
Changes in plan assets
Fair value of plan assets at beginning of year	15,791	15,865
Actual return on assets	2,413	1,291
Employer contributions	5,598	500
Benefits paid	(1,657)	(1,865)
Fair value of plan assets at end of year	22,145	15,791	$ 15,865
Funded status at end of year	(6,241)	(9,467)
Amounts recognized in consolidated balance sheet
Long-term pension liability	(8,319)	(9,467)
	(6,241)	(9,467)
Amounts recognized in accumulated other comprehensive income consist of:
Net actuarial loss	10,903	9,819
Other Assets [Member]
Amounts recognized in consolidated balance sheet
Other assets	2,181
Other Current Liabilities [Member]
Amounts recognized in consolidated balance sheet
Other current liabilities	$ (103)

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Note 8 - Benefit Plans - Pension Plans with Projected Benefit Obligation in Excess of Plan Assets (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Projected benefit obligation	$ 28,386	$ 25,258
Fair value of plan assets	(22,145)	(15,791)
	$ 6,241	$ 9,467

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Note 8 - Benefit Plans - Net Periodic Benefit Cost (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Service cost - benefits earned during the period	$ 65	$ 57	$ 48
Interest cost on projected benefit obligation	965	988	951
Expected return on plan assets	(1,218)	(1,188)	(1,343)
Recognized actuarial loss	3,755	1,288
Settlement loss	435	445	460
Net periodic pension cost after settlements	1,289	1,329	888
Recognized Actuarial Loss [Member]
Recognized actuarial loss	$ 1,042	$ 1,027	$ 772

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Note 8 - Benefit Plans - Assumptions Used to Determine Benefit Obligations and Net Periodic Benefit (Details)	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Corporate Segment [Member]
Benefit obligations, discount	3.53%	4.04%
Benefit obligations, long-term rate of return	8.00%	8.00%
Benefit obligations, salary scale
Benefit obligations, net discount rate	4.04%	4.19%	3.86%
Benefit obligations, net long-term rate of return	8.00%	8.00%	8.00%
Benefit obligations, net salary scale
Plants [Member]
Benefit obligations, discount	3.45%	3.91%
Benefit obligations, long-term rate of return	8.00%	8.00%
Benefit obligations, salary scale
Benefit obligations, net discount rate	3.91%	4.09%	3.74%
Benefit obligations, net long-term rate of return	8.00%	8.00%	8.00%
Benefit obligations, net salary scale

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Note 8 - Benefit Plans - Actual and Target Pension Plan Asset Allocation (Details)	Dec. 31, 2017	Dec. 31, 2016
Percentage of plan assets	100.00%	100.00%
Target allocation	100.00%
Equity Securities [Member]
Percentage of plan assets	52.00%	68.00%
Target allocation	52.00%
Fixed Income Investments [Member]
Percentage of plan assets	29.00%	13.00%
Target allocation	29.00%
Other than Securities Investment [Member]
Percentage of plan assets	19.00%	19.00%
Target allocation	19.00%

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Note 8 - Benefit Plans - Projected Benefit Payments (Details) $ in Thousands	Dec. 31, 2017 USD ($)
2018	$ 1,467
2019	1,652
2020	2,135
2021	1,947
2022	1,979
2023-2027	$ 8,620

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Note 9 - Quarterly Results for 2015, 2016 and 2017 (Unaudited) (Details Textual) - USD ($) $ in Thousands	3 Months Ended		12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income Tax Expense (Benefit)	$ 5,000		$ 9,760	$ 5,260	$ 5,830
Tax Adjustments, Settlements, and Unusual Provisions	$ 4,000		$ 4,000
Reclassification from APIC to Income Tax Expense [Member] | Three Months Ended March 31, 2016 [Member]
Prior Period Reclassification Adjustment		$ 200
Reclassification from APIC to Income Tax Expense [Member] | Three Months Ended June 30, 2016 [Member]
Prior Period Reclassification Adjustment		200
Reclassification from APIC to Income Tax Expense [Member] | Three Months Ended September 30, 2016 [Member]
Prior Period Reclassification Adjustment		$ 100

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Note 9 - Quarterly Results for 2015, 2016 and 2017 (Unaudited) - Quarterly Results (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended												12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Net sales	$ 72,450	$ 67,773	$ 65,604	$ 60,987	$ 64,686	$ 65,282	$ 64,660	$ 57,968	$ 53,192	$ 56,662	$ 54,116	$ 46,347
Gross profit	25,975	24,789	23,374	22,214	22,058	23,140	21,763	20,021	17,882	19,224	18,531	15,796	$ 96,352	$ 86,982	$ 71,433
Income before taxes on income	6,834	6,842	5,701	5,405	5,867	6,006	4,615	3,410	4,698	5,581	5,394	3,223
Net earnings used in the computation of basic and diluted earnings per share (in thousands)	$ 1,884	$ 4,962	$ 4,341	$ 3,835	$ 4,441	$ 4,447	$ 3,308	$ 2,442	$ 3,368	$ 4,031	$ 3,624	$ 2,043	$ 15,022	$ 14,638	$ 13,066
Weighted average number of shares outstanding during the period
Net earnings (in dollars per share)	$ 0.13	$ 0.34	$ 0.30	$ 0.27	$ 0.31	$ 0.31	$ 0.23	$ 0.18	$ 0.24	$ 0.29	$ 0.26	$ 0.15	$ 1.04	$ 1.04	$ 0.95
Net earnings (in dollars per share)	$ 0.12	$ 0.33	$ 0.29	$ 0.26	$ 0.30	$ 0.30	$ 0.22	$ 0.17	$ 0.23	$ 0.28	$ 0.25	$ 0.14	$ 0.99	$ 0.98	$ 0.90
(Basic) (in shares)	14,614,691	14,573,813	14,501,399	14,350,721	14,162,939	14,118,354	14,120,617	13,927,063	13,894,907	13,833,561	13,730,646	13,584,922	14,510,156	14,082,243	13,761,009
(Diluted) (in shares)	15,275,222	15,229,722	15,040,431	14,929,695	14,979,746	14,984,084	14,957,469	14,668,658	14,603,464	14,585,688	14,577,342	14,548,084	15,118,768	14,897,489	14,578,644
Net sales	$ 72,450	$ 67,773	$ 65,604	$ 60,987	$ 64,686	$ 65,282	$ 64,660	$ 57,968	$ 53,192	$ 56,662	$ 54,116	$ 46,347
Gross profit	25,975	24,789	23,374	22,214	22,058	23,140	21,763	20,021	17,882	19,224	18,531	15,796	$ 96,352	$ 86,982	$ 71,433
Income before taxes on income	6,834	6,842	5,701	5,405	5,867	6,006	4,615	3,410	4,698	5,581	5,394	3,223
Net earnings used in the computation of basic and diluted earnings per share (in thousands)	$ 1,884	$ 4,962	$ 4,341	$ 3,835	$ 4,441	$ 4,447	$ 3,308	$ 2,442	$ 3,368	$ 4,031	$ 3,624	$ 2,043	$ 15,022	$ 14,638	$ 13,066

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Note 10 - Rentals (Details Textual) - USD ($) $ in Millions	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Operating Leases, Rent Expense	$ 1.1	$ 1.1	$ 0.3
Operating Leases, Future Minimum Payments Due	2.1
Operating Leases, Future Minimum Payments Due, Next Twelve Months	0.9
Operating Leases, Future Minimum Payments, Due in Two Years	0.6
Operating Leases, Future Minimum Payments, Due in Three Years	0.5
Operating Leases, Future Minimum Payments, Due in Four Years	$ 0.1

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Note 12 - Share-based Compensation (Details Textual) - USD ($) $ / shares in Units, $ in Thousands		12 Months Ended
		Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized		5,000,000
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant		3,667,577
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term		5 years
Share-based Compensation Arrangement by Share-based Payment Award Options Vested and Expected to Vest Exercisable Intrinsic Value		$ 8,500
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term		3 years 300 days
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value		$ 4,200	$ 3,100	$ 3,500
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross		155,142	172,862	153,618
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value		$ 5.56	$ 4.69	$ 5.22
Proceeds from Stock Options Exercised		$ 1,872	$ 1,504	$ 1,840
Employee Service Share-based Compensation, Tax Benefit from Exercise of Stock Options		$ 800	400	600
Stock Appreciation Rights (SARs) [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term	[1]	5 years
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercisable, Weighted Average Remaining Contractual Term		2 years 330 days
Employee Service Share-based Compensation, Tax Benefit from Exercise of Stock Options		$ 1,300	500	1,000
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Aggregate Intrinsic Value, Outstanding		1,400
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Aggregate Intrinsic Value, Vested		$ 3,500	$ 1,500	$ 2,600
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value		$ 4.83	$ 4.49	$ 5.20
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value		$ 18.30	$ 16.35
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period		3 years
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized		$ 700
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition		2 years 3 days
Performance Shares [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value		$ 18.39
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period		5 years
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized		$ 1,600
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized, Period for Recognition		3 years 91 days
Performance Shares [Member] | Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period		3 years
Performance Shares [Member] | Maximum [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period		5 years
Common Stock [Member]
Shares Received from Stock Options Exercised		50,981	27,770	14,571
Stock Issued During Period, Shares, New Issues		144,443	81,608	50,224
Outside Directors [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term		10 years

[1] The expected life in years for awards granted was based on the historical exercise patterns experienced by the Company when the award is made.

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Note 12 - Share-based Compensation - Shared-based Compensation Expense and the Related Tax Benefit (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Share-based compensation expense	$ 1,664	$ 1,638	$ 1,361
Related income tax benefit	229	325	203
Stock Options and SARs [Member]
Share-based compensation expense	1,093	1,071	1,079
Restricted Stock [Member]
Share-based compensation expense	331	317	282
Performance Shares [Member]
Share-based compensation expense	$ 240	$ 250

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Note 12 - Share-based Compensation - Stock Option Transactions (Details) - $ / shares	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Outstanding options (in shares)	825,251	946,546
Outstanding options (in dollars per share)	$ 10.46	$ 8.39
Granted options (in shares)	155,142	172,862	153,618
Granted options (in dollars per share)	$ 18.67	$ 16.53
Exercised options (in shares)	(336,726)	(279,766)
Exercised options (in dollars per share)	$ 8.71	$ 7.31
Lapsed options (in shares)	(1,100)	(11,131)
Lapsed options (in dollars per share)	$ 5.86	$ 5.92
Cancelled options (in shares)	(8,690)	(3,260)
Cancelled options (in dollars per share)	$ 15.82	$ 17.53
Outstanding options (in shares)	633,877	825,251	946,546
Outstanding options (in dollars per share)	$ 13.33	$ 10.46	$ 8.39

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Note 12 - Share-based Compensation - Stock Options Outstanding (Details)	12 Months Ended
	Dec. 31, 2017 $ / shares shares
Lower range of exercise prices on options (in dollars per share)	$ 3.82
Upper range of exercise prices on options (in dollars per share)	$ 21.63
Options outstanding (in shares) | shares	633,877
Weighted average remaining contractual life on options (Year)	3 years 306 days
Weighted average exercise price on options (in dollars per share)	$ 13.33
Exercise Price Range 1 [Member]
Lower range of exercise prices on options (in dollars per share)	3.82
Upper range of exercise prices on options (in dollars per share)	$ 5.55
Options outstanding (in shares) | shares	59,000
Weighted average remaining contractual life on options (Year)	2 years 29 days
Weighted average exercise price on options (in dollars per share)	$ 4.81
Exercise Price Range 2 [Member]
Lower range of exercise prices on options (in dollars per share)	5.65
Upper range of exercise prices on options (in dollars per share)	$ 7.36
Options outstanding (in shares) | shares	151,995
Weighted average remaining contractual life on options (Year)	1 year 350 days
Weighted average exercise price on options (in dollars per share)	$ 6.65
Exercise Price Range 3 [Member]
Lower range of exercise prices on options (in dollars per share)	7.96
Upper range of exercise prices on options (in dollars per share)	$ 10.38
Options outstanding (in shares) | shares	45,100
Weighted average remaining contractual life on options (Year)	4 years 193 days
Weighted average exercise price on options (in dollars per share)	$ 8.87
Exercise Price Range 4 [Member]
Lower range of exercise prices on options (in dollars per share)	16.35
Upper range of exercise prices on options (in dollars per share)	$ 21.63
Options outstanding (in shares) | shares	377,782
Weighted average remaining contractual life on options (Year)	4 years 288 days
Weighted average exercise price on options (in dollars per share)	$ 17.88

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Note 12 - Share-based Compensation - Stock-Settled Stock Appreciation Rights Transactions (Details) - Stock Appreciation Rights (SARs) [Member] - $ / shares	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Outstanding SARS (in shares)	325,506	381,566
Outstanding SARS, weighted average exercise price (in dollars per share)	$ 10.26	$ 8.14
Granted SARS (in shares)	43,988	58,108
Granted SARS, weighted average exercise price (in dollars per share)	$ 16.97	$ 16.35
Exercised SARS (in shares)	(222,990)	(114,168)
Exercised SARS, weighted average exercise price (in dollars per share)	$ 6.90	$ 6.27
Granted SARS (in shares)	43,988	58,108
Exercised SARS (in shares)	(222,990)	(114,168)
Outstanding SARS (in shares)	146,504	325,506
Outstanding SARS, weighted average exercise price (in dollars per share)	$ 17.38	$ 10.26

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Note 12 - Share-based Compensation - Stock Appreciation Rights Outstanding (Details) - $ / shares	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Lower range of exercise prices on options (in dollars per share)	$ 3.82
Upper range of exercise prices on options (in dollars per share)	21.63
Exercise Price Range 1 [Member]
Lower range of exercise prices on options (in dollars per share)	3.82
Upper range of exercise prices on options (in dollars per share)	$ 5.55
Stock Appreciation Rights (SARs) [Member]
SARS (in shares)	146,504	325,506	381,566
Weighted average exercise price (in dollars per share)	$ 17.38	$ 10.26	$ 8.14
Stock Appreciation Rights (SARs) [Member] | Exercise Price Range 1 [Member]
Lower range of exercise prices on options (in dollars per share)	16.35
Upper range of exercise prices on options (in dollars per share)	$ 18.66
SARS (in shares)	146,504
Weighted average remaining contractual life (Year)	2 years 335 days
Weighted average exercise price (in dollars per share)	$ 17.38

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Note 12 - Share-based Compensation - Summary of Significant Assumptions for Share-based Compensation Awards (Details) - $ / shares		12 Months Ended
		Dec. 31, 2017	Dec. 31, 2016		Dec. 31, 2015
Risk free interest rate
Expected award (Year)		5 years
Stock Appreciation Rights (SARs) [Member]
Exercise price
Exercise price (in dollars per share)		$ 16.97	$ 16.35		$ 18.66
Market price
Market price (in dollars per share)		$ 16.97	$ 16.35		$ 18.66
Risk free interest rate
Risk free interest rate	[1]	1.90%	1.30%		1.50%
Expected award (Year)	[2]	5 years
Expected volatility
Expected volatility	[3]	36.60%	36.50%		34.90%
Expected dividend yield
Expected dividend yield	[4]	2.10%	2.00%		1.60%
Employee Stock Option [Member] | Minimum [Member]
Exercise price
Exercise price (in dollars per share)		$ 16.97	$ 16.35		$ 16.78
Market price
Market price (in dollars per share)		$ 16.97	$ 16.35		$ 16.78
Risk free interest rate
Risk free interest rate		1.80%	1.10%	[1]	1.50%	[1]
Expected award (Year)	[2]	5 years
Expected volatility
Expected volatility	[3]	36.60%	36.50%		34.90%
Expected dividend yield
Expected dividend yield	[4]	1.80%	1.80%		1.60%
Employee Stock Option [Member] | Maximum [Member]
Exercise price
Exercise price (in dollars per share)		$ 21.63	$ 18.55		$ 18.66
Market price
Market price (in dollars per share)		$ 21.63	$ 18.55		$ 18.66
Risk free interest rate
Risk free interest rate	[1]	2.40%	1.80%		2.10%
Expected award (Year)	[2]	10 years
Expected volatility
Expected volatility	[3]	41.40%	40.30%		39.00%
Expected dividend yield
Expected dividend yield	[4]	2.10%	2.10%		1.90%

[1] The risk-free interest rate is based on the yield of a U.S. treasury bond with a similar maturity as the expected life of the awards.

[2] The expected life in years for awards granted was based on the historical exercise patterns experienced by the Company when the award is made.

[3] The determination of expected stock price volatility for awards granted in each of the three years ended December 31, 2017, 2016 and 2015 was based on historical Superior common stock prices over a period commensurate with the expected life.

[4] The dividend yield assumption is based on the history and expectation of the Company's dividend payouts.

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Note 12 - Share-based Compensation - Restricted Stock Transactions (Details) - Restricted Stock [Member] - $ / shares	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016
Outstanding restricted stock (in shares)	123,688	114,342
Outstanding restricted stock (in dollars per share)	$ 8.94	$ 8.39
Granted restricted stock (in shares)	43,706	10,396
Granted restricted stock (in dollars per share)	$ 18.30	$ 16.35
Vested restricted stock (in shares)	(106,016)
Vested restricted stock (in dollars per share)	$ 7.62
Forfeited restricted stock (in shares)		(1,050)
Forfeited restricted stock (in dollars per share)		$ 21.92
Granted restricted stock (in shares)	43,706	10,396
Vested restricted stock (in dollars per share)	$ 7.62
Forfeited restricted stock (in dollars per share)		$ 21.92
Outstanding restricted stock (in shares)	61,378	123,688
Outstanding restricted stock (in dollars per share)	$ 17.89	$ 8.94

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Note 12 - Share-based Compensation - Performance Share Transactions (Details) - Performance Shares [Member]	12 Months Ended
	Dec. 31, 2017 $ / shares shares
Outstanding restricted stock (in shares) | shares	101,000
Outstanding restricted stock (in dollars per share) | $ / shares	$ 16.36
Granted performance shares (in shares) | shares	50,826
Granted performance shares (in dollars per share) | $ / shares	$ 18.39
Vested performance shares (in shares) | shares	0
Vested performance shares (in dollars per share) | $ / shares	$ 0
Forfeited performance shares (in shares) | shares	(33,334)
Forfeited performance shares (in dollars per share) | $ / shares	$ 16.35
Outstanding restricted stock (in shares) | shares	118,492
Outstanding restricted stock (in dollars per share) | $ / shares	$ 17.24

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Note 13 - Earnings Per Share (Details Textual) - Stock Compensation Plan [Member] - $ / shares	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount	37,450	124,000	108,400
Antidilutive Securities Excluded from Computation of Earnings Per Share, Weight Average Exercise Price	$ 18.65	$ 18.53	$ 17.98

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Note 13 - Earnings Per Share - Reconciliation of Basic and Diluted Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended												12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Net earnings used in the computation of basic and diluted earnings per share (in thousands)	$ 1,884	$ 4,962	$ 4,341	$ 3,835	$ 4,441	$ 4,447	$ 3,308	$ 2,442	$ 3,368	$ 4,031	$ 3,624	$ 2,043	$ 15,022	$ 14,638	$ 13,066
Weighted average shares outstanding - basic (in shares)	14,614,691	14,573,813	14,501,399	14,350,721	14,162,939	14,118,354	14,120,617	13,927,063	13,894,907	13,833,561	13,730,646	13,584,922	14,510,156	14,082,243	13,761,009
Common stock equivalents (in shares)													608,612	815,246	817,635
Total weighted average shares outstanding - diluted (in shares)	15,275,222	15,229,722	15,040,431	14,929,695	14,979,746	14,984,084	14,957,469	14,668,658	14,603,464	14,585,688	14,577,342	14,548,084	15,118,768	14,897,489	14,578,644
Weighted average number of shares outstanding during the period
Net earnings (in dollars per share)	$ 0.13	$ 0.34	$ 0.30	$ 0.27	$ 0.31	$ 0.31	$ 0.23	$ 0.18	$ 0.24	$ 0.29	$ 0.26	$ 0.15	$ 1.04	$ 1.04	$ 0.95
Net earnings (in dollars per share)	$ 0.12	$ 0.33	$ 0.29	$ 0.26	$ 0.30	$ 0.30	$ 0.22	$ 0.17	$ 0.23	$ 0.28	$ 0.25	$ 0.14	$ 0.99	$ 0.98	$ 0.90

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Note 14 - Other Current Liabilities - Accrued Expenses (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 31, 2016
Salaries, wages, commissions and vacation pay	$ 7,851	$ 5,600
Accrued rebates	1,089	1,932
Defined contribution plan accrual	104	897
Customer deposits	473	670
Other accrued expenses	2,892	1,617
	$ 12,409	$ 10,716

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Note 15 - Supplemental Cash Flow Information (Details Textual) - shares	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Stock Repurchased During Period, Shares	50,981	27,770	14,571
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period	336,726	279,766
Employee Stock Option [Member]
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period	144,443	81,608	50,224

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Note 15 - Supplemental Cash Flow Information - Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Income taxes paid	$ 7,173	$ 5,076	$ 6,897
Interest paid	$ 727	$ 694	$ 523

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Note 16 - Stock Repurchase Plan (Details Textual) - shares	12 Months Ended
	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015	Aug. 01, 2008
Stock Repurchase Program, Number of Shares Authorized to be Repurchased				1,000,000
Stock Repurchased and Retired During Period, Shares	0	45,100	0
Stock Repurchase Program, Remaining Number of Shares Authorized to be Repurchased	216,575

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Note 17 - Operating Segment Information (Details Textual)	12 Months Ended
	Dec. 31, 2017
Number of Operating Segments	3

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Note 17 - Operating Segment Information - Information Related to the Operations of the Company's Operating Segments (Details) - USD ($) $ in Thousands	3 Months Ended												12 Months Ended
	Dec. 31, 2017	Sep. 30, 2017	Jun. 30, 2017	Mar. 31, 2017	Dec. 31, 2016	Sep. 30, 2016	Jun. 30, 2016	Mar. 31, 2016	Dec. 31, 2015	Sep. 30, 2015	Jun. 30, 2015	Mar. 31, 2015	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Net sales													$ 266,814	$ 252,596	$ 210,317
Gross margin	$ 25,975	$ 24,789	$ 23,374	$ 22,214	$ 22,058	$ 23,140	$ 21,763	$ 20,021	$ 17,882	$ 19,224	$ 18,531	$ 15,796	96,352	86,982	71,433
Selling and administrative expenses													71,816	66,396	52,018
Gain on sale of property, plant and equipment													1,048
Interest expense													802	688	519
Income before taxes on income													24,782	19,898	18,896
Depreciation and amortization													5,653	4,935	3,873
Capital expenditures													4,248	7,385	8,069
Total assets	218,938				196,848				151,731				218,938	196,848	151,731
Uniforms and Related Products [Member]
Net sales													204,644	210,373	198,319
Gross margin													72,463	69,987	65,247
Selling and administrative expenses													54,191	52,225	49,225
Gain on sale of property, plant and equipment													(2)
Interest expense													387	462	519
Income before taxes on income													17,883	17,300	15,503
Depreciation and amortization													4,223	4,023	3,561
Capital expenditures													2,870	3,383	3,003
Total assets	182,623				176,070				140,710				182,623	176,070	140,710
Remote Staffing Solutions [Member]
Net sales													23,021	17,953	15,604
Gross margin													12,460	9,616	8,579
Selling and administrative expenses													7,877	6,096	5,186
Gain on sale of property, plant and equipment													1,050
Interest expense
Income before taxes on income													5,633	3,520	3,393
Depreciation and amortization													846	494	312
Capital expenditures													1,156	3,872	5,066
Total assets	21,846				19,752				14,551				21,846	19,752	14,551
Promotional Products Segment [Member]
Net sales													42,904	27,816
Gross margin													13,860	9,690
Selling and administrative expenses													12,179	10,386
Gain on sale of property, plant and equipment
Interest expense													415	226
Income before taxes on income													1,266	(922)
Depreciation and amortization													584	418
Capital expenditures													219	130
Total assets	54,997				28,480								54,997	28,480
Intersegment Eliminations [Member]
Net sales													(3,755)	(3,546)	(3,606)
Gross margin													(2,431)	(2,311)	(2,393)
Selling and administrative expenses													(2,431)	(2,311)	(2,393)
Gain on sale of property, plant and equipment
Interest expense
Income before taxes on income
Depreciation and amortization
Capital expenditures
Total assets	$ (40,528)				$ (27,454)				$ (3,530)				$ (40,528)	$ (27,454)	$ (3,530)

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Note 18 - Acquisition of Business (Details Textual) - USD ($)						1 Months Ended	12 Months Ended
	Dec. 01, 2017	Aug. 21, 2017	Mar. 08, 2016	Jan. 01, 2015	Jan. 01, 2014	Dec. 31, 2017	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Amortization of Intangible Assets							$ 2,400,000	$ 2,300,000	$ 2,100,000
Goodwill						$ 16,032,000	16,032,000	11,269,000
BAMKO [Member]
Payments to Acquire Businesses, Gross			$ 15,200,000
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares			324,000
Business Acquisition, Equity Interested Issued, Vesting Period			5 years
Business Combination, Liabilities Arising From Contingencies, Earn Out Liability, Before Discount			$ 5,500,000
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill			11,360,000
Business Combination, Contingent Consideration, Liability						5,200,000	5,200,000
Amortization of Intangible Assets							$ 400,000	300,000
Business Combination, Acquisition Related Costs					$ 1,100,000			1,100
Business Acquisition, Pro Forma Revenue								6,600,000	31,500,000
Business Acquisition, Pro Forma Net Income (Loss)								$ 1,100,000	$ (400,000)
Business Acquisition, Pro Forma Earnings Per Share, Basic								$ 0.08	$ 0.03
Business Combination, Consideration Transferred			24,924,000
Goodwill			6,994,000
BAMKO [Member] | Customer Relationships [Member]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill			2,100,000
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life							7 years
BAMKO [Member] | Noncompete Agreements [Member]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill			400,000
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life							5 years 302 days
BAMKO [Member] | Trade Names [Member]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill			$ 8,900,000
Public Identity [Member]
Payments to Acquire Businesses, Gross		$ 800,000
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares		54,000
Business Acquisition, Equity Interested Issued, Vesting Period		3 years
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill		$ 1,700,000
Business Combination, Contingent Consideration Arrangements, Range of Outcomes, Value, High		400,000
Business Combination, Consideration Transferred		2,300,000
Goodwill		$ 600,000
Tangerine [Member]
Payments to Acquire Businesses, Gross	$ 7,200,000
Business Acquisition, Equity Interest Issued or Issuable, Number of Shares	83,000
Business Acquisition, Equity Interested Issued, Vesting Period	4 years
Business Combination, Liabilities Arising From Contingencies, Earn Out Liability, Before Discount	$ 5,500,000
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill	6,495,000
Business Combination, Contingent Consideration, Liability						3,200,000	$ 3,200,000
Amortization of Intangible Assets						$ 100,000
Business Combination, Acquisition Related Costs				$ 200,000			200,000
Business Acquisition, Pro Forma Revenue							35,100,000	$ 43,100,000	$ 48,000,000
Business Acquisition, Pro Forma Net Income (Loss)							$ 1,900,000	$ (2,400,000)	$ 100,000
Business Acquisition, Pro Forma Earnings Per Share, Basic							$ 0.13	$ 0.17
Business Combination, Consideration Transferred	12,088,000
Goodwill	4,169,000
Tangerine [Member] | Customer Relationships [Member]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill	3,100,000
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life						7 years
Tangerine [Member] | Noncompete Agreements [Member]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill	200,000
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life						7 years
Tangerine [Member] | Trade Names [Member]
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill	$ 3,200,000

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Note 18 - Acquisition of Business - Purchase Price (Details) - USD ($) $ in Thousands			12 Months Ended
	Dec. 01, 2017	Mar. 08, 2016	Dec. 31, 2017	Dec. 31, 2016	Dec. 31, 2015
Cash consideration at closing, net of cash acquired			$ 7,988	$ 15,161
BAMKO [Member]
Cash consideration at closing, net of cash acquired		$ 15,161
Restricted shares of Superior common stock issued		4,558
Contingent consideration		5,205
Business Combination, Consideration Transferred		$ 24,924
Tangerine [Member]
Cash consideration at closing, net of cash acquired	$ 7,222
Restricted shares of Superior common stock issued	1,657
Contingent consideration	3,209
Business Combination, Consideration Transferred	$ 12,088

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Note 18 - Acquisition of Business - Aggregate Consideration (Details) - USD ($) $ in Thousands	Dec. 31, 2017	Dec. 01, 2017	Dec. 31, 2016	Mar. 08, 2016
Goodwill	$ 16,032		$ 11,269
BAMKO [Member]
Accounts receivable				$ 4,885
Prepaid expenses and other current assets				3,200
Inventories				236
Property, plant and equipment				199
Other Assets				100
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill				11,360
Goodwill				6,994
Total assets				26,974
Accounts Payables				1,314
Other current liabilities				736
Total liabilities				$ 2,050
Tangerine [Member]
Accounts receivable		$ 5,051
Prepaid expenses and other current assets		969
Property, plant and equipment		131
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Intangible Assets, Other than Goodwill		6,495
Goodwill		4,169
Total assets		16,815
Accounts Payables		3,374
Other current liabilities		1,353
Total liabilities		$ 4,727