What changed in this filing

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Item 1. Financial Statements

2025-08-05 compared with 2025-05-08 · 156 added, 53 removed, 367 unchanged (36% of the section changed)

4 unchanged sentences

(In thousands, except shares and per share data)

Three Months Ended March 31,

Three Months Ended June 30,

Six Months Ended June 30,

$ 144,045 $ 131,736 $ 281,142 $ 270,578

6 unchanged sentences

1,250 1,541 2,495 3,328

(Loss) income before income tax (benefit) expense

142,209 131,086 280,212 265,336

Income tax (benefit) expense

Net (loss) income

Income before income tax expense

1,836 650 930 5,242

Net (loss) income per share:

Income tax expense

285 50 137 730

$ 1,551 $ 600 $ 793 $ 4,512

Net income per share:

$ 0.10 $ 0.04 $ 0.05 $ 0.28

$ 0.10 $ 0.04 $ 0.05 $ 0.27

Weighted average shares outstanding during the period:

3 unchanged sentences

Defined benefit pension plans

$ 8 $ 23 $ 15 $ 46

Foreign currency translation adjustment

2 unchanged sentences

1,100 ( 1,228 ) 2,118 ( 1,686 )

Comprehensive income

Comprehensive income (loss)

$ 2,651 $ ( 628 ) $ 2,911 $ 2,826

65 unchanged sentences

CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

THREE MONTHS ENDED March 31, 2025 AND 2024

THREE MONTHS ENDED June 30, 2025 AND 2024

(In thousands, except shares and per share data)

2 unchanged sentences

Shareholders’

Balance, April 1, 2024

16,743,723 $ 16 $ 79,602 $ 123,946 $ ( 2,743 ) $ 200,821

Issuance of common stock under stock incentive plans and related tax effect

48,854 - 740 ( 113 ) - 627

Share-based compensation expense

- - 605 - - 605

Written put options

- - 1,812 - - 1,812

Cash dividends declared ($ 0.14 per share)

- - - ( 2,327 ) - ( 2,327 )

Comprehensive income (loss):

- - - 600 - 600

Pensions, net of taxes of $ 8

- - - - 23 23

Change in currency translation adjustment, net of taxes of $ 0

- - - - ( 1,251 ) ( 1,251 )

Balance, June 30, 2024

16,792,577 $ 16 $ 82,759 $ 122,106 $ ( 3,971 ) $ 200,910

Balance, April 1, 2025

16,244,241 $ 15 $ 83,931 $ 114,825 $ ( 4,341 ) $ 194,430

Issuance of common stock under stock incentive plans and related tax effect

76,051 - 99 - 99

Common shares repurchased and retired

( 402,329 ) - ( 2,024 ) ( 2,124 ) - ( 4,148 )

Share-based compensation expense

- - 1,279 - - 1,279

Cash dividends declared ($ 0.14 per share)

- - - ( 2,235 ) - ( 2,235 )

Comprehensive income (loss):

- - - 1,551 - 1,551

Pensions, net of taxes of $ 2

Change in currency translation adjustment, net of taxes of $ 0

- - - - 1,092 1,092

Balance, June 30, 2025

15,917,963 $ 15 $ 83,285 $ 112,017 $ ( 3,241 ) $ 192,076

SUPERIOR GROUP OF COMPANIES, INC.

AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDERS ’ EQUITY

six MONTHS ENDED June 30, 2025 AND 2024

(In thousands, except shares and per share data)

Comprehensive

Income (Loss),

Shareholders’

Balance, January 1, 2024

14 unchanged sentences

- - - - ( 1,732 ) ( 1,732 )

Balance, March 31, 2024

Balance, June 30, 2024

16,792,577 $ 16 $ 82,759 $ 122,106 $ ( 3,971 ) $ 200,910

12 unchanged sentences

Pensions, net of taxes of $ 5

- - - - 15 15

Change in currency translation adjustment, net of taxes of $ 0

- - - - 2,103 2,103

Balance, March 31, 2025

Balance, June 30, 2025

15,917,963 $ 15 $ 83,285 $ 112,017 $ ( 3,241 ) $ 192,076

4 unchanged sentences

(In thousands)

Three Months Ended March 31,

Six Months Ended June 30,

CASH FLOWS FROM OPERATING ACTIVITIES

Net (loss) income

Adjustments to reconcile net (loss) income to net cash provided by operating activities:

$ 793 $ 4,512

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

Inventory write-downs

Credit loss expense

2,100 ( 383 )

Share-based compensation expense

Change in fair value of acquisition-related contingent liabilities

Change in fair value of written put options

Changes in assets and liabilities, net of acquisition of a business:

Accounts receivable

( 569 ) 10,578

Contract assets

( 1,682 ) ( 4,526 )

( 10,692 ) 3,936

Prepaid expenses and other current assets

1,267 ( 1,309 )

( 789 ) ( 761 )

Accounts payable and other current liabilities

Long-term pension liability

1,740 ( 6,424 )

Other long-term liabilities

Net cash (used in) provided by operating activities

Net cash provided by operating activities

CASH FLOWS FROM INVESTING ACTIVITIES

Additions to property, plant and equipment

( 2,716 ) ( 1,974 )

Net cash used in investing activities

( 2,716 ) ( 1,974 )

CASH FLOWS FROM FINANCING ACTIVITIES

Borrowings under revolving lines of credit

57,000 10,000

Payments under revolving lines of credit

( 41,000 ) ( 24,000 )

Payments of term loan

( 2,812 ) ( 1,875 )

Payment of cash dividends

( 4,515 ) ( 4,657 )

Payment of acquisition-related contingent liabilities

Proceeds received on exercise of stock options and shares withheld for taxes

Proceeds received on exercise of stock options and payments for shares withheld for taxes

Common shares repurchased and retired

Net cash provided by (used in) financing activities

936 ( 20,013 )

Effect of currency exchange rates on cash

1,094 ( 835 )

Net increase in cash and cash equivalents

2,260 ( 6,522 )

Cash and cash equivalents balance, beginning of period

18,766 19,896

Cash and cash equivalents balance, end of period

$ 21,026 $ 13,374

See accompanying Condensed Notes to the Consolidated Financial Statements.

15 unchanged sentences

This segment sells its products to healthcare laundries, dealers, distributors, retailers and consumers primarily in the United States.

Superior’s Contact Centers segment, through multiple The Office Gurus® entities, including subsidiaries in El Salvador, Belize, Jamaica, Dominican Republic and the United States (collectively, “TOG”), provides outsourced, nearshore business process outsourcing, contact and call-center support services to North American customers.

Superior’s Contact Centers segment, through multiple The Office Gurus® entities, including subsidiaries in El Salvador, Belize, Dominican Republic, the United States and in Jamaica until its closure on June 15, 2025, provides outsourced, nearshore business process outsourcing, contact and call-center support services to North American customers.

Basis of presentation

9 unchanged sentences

Reclassifications only impact items within our statements of comprehensive income, our statements of shareholders' equity, our statements of cash flows and Note 7 Inventories.

These reclassifications did not have an effect on the Company’s consolidated results of operations, financial position or cash flows for the quarter ended March 31, 2025 .

These reclassifications did not have an effect on the Company’s consolidated results of operations, financial position or cash flows for the quarter ended June 30, 2025 .

Recently Issued Accounting Pronouncements Not Yet Adopted

22 unchanged sentences

Contact Centers:

Through multiple The Office Gurus® entities, including our subsidiaries in El Salvador, Belize, Jamaica, Dominican Republic and the United States (collectively, “TOG”), we provide outsourced, nearshore business process outsourcing, contact and call-center support services to North American customers.

Through multiple The Office Gurus® entities, including our subsidiaries in El Salvador, Belize, Dominican Republic, the United States and Jamaica until its closure on June 15, 2025, we provide outsourced, nearshore business process outsourcing, contact and call-center support services to North American customers.

Intersegment eliminations include the elimination of revenues and costs from services provided by the Contact Centers segment to the Company’s two other segments.

10 unchanged sentences

Intersegment Eliminations

For the Three Months Ended March 31, 2025:

For the Three Months Ended June 30, 2025:

$ 92,647 $ 28,253 $ 23,977 $ ( 832 ) $ - $ 144,045

12 unchanged sentences

Intersegment Eliminations

For the Three Months Ended March 31, 2024:

For the Three Months Ended June 30, 2024:

$ 81,296 $ 26,592 $ 24,832 $ ( 984 ) $ - $ 131,736

8 unchanged sentences

$ 6,724 $ 1,277 $ 3,181 $ - $ ( 5,623 ) $ 5,559

The following table reconciles (loss) income before income tax (benefit) expense to Segment EBITDA (in thousands):

Three Months Ended March 31,

(Loss) income before income tax (benefit) expense

Branded Products

Healthcare Apparel

Contact Centers

Intersegment Eliminations

For the Six Months Ended June 30, 2025:

$ 179,121 $ 55,516 $ 48,202 $ ( 1,697 ) $ - $ 281,142

Interest expense, net

Cost of goods sold

118,418 35,367 22,608 ( 1,018 ) - 175,375

60,703 20,149 25,594 ( 679 ) - 105,767

Selling and administrative expenses

48,852 19,604 22,533 ( 679 ) 12,032 102,342

Depreciation and amortization

2,875 1,766 1,361 - 180 6,182

Segment EBITDA(1)

$ 14,726 $ 2,311 $ 4,422 $ - $ ( 11,852 ) $ 9,607

Branded Products

Healthcare Apparel

Contact Centers

Intersegment Eliminations

For the Six Months Ended June 30, 2024:

$ 168,364 $ 55,829 $ 48,384 $ ( 1,999 ) $ - $ 270,578

Cost of goods sold

108,497 34,119 22,779 ( 889 ) - 164,506

59,867 21,710 25,605 ( 1,110 ) - 106,072

Selling and administrative expenses

46,263 19,691 20,954 ( 1,110 ) 11,704 97,502

Depreciation and amortization

3,067 1,893 1,476 - 184 6,620

Segment EBITDA(1)

$ 16,671 $ 3,912 $ 6,127 $ - $ ( 11,520 ) $ 15,190

The following table reconciles income before income tax expense to Segment EBITDA (in thousands):

Three Months Ended June 30,

Six Months Ended June 30,

Income before income tax expense

$ 1,836 $ 650 $ 930 $ 5,242

Interest expense

1,250 1,541 2,495 3,328

Depreciation and amortization

2,978 3,368 6,182 6,620

Segment EBITDA

$ 6,064 $ 5,559 $ 9,607 $ 15,190

NOTE 3 – Net Sales:

17 unchanged sentences

If the customer is deemed to take control of the inventory prior to pick up, the Company recognizes the revenue as a bill-and-hold transaction in accordance with Topic 606.

Sales under bill-and-hold arrangements totaled $ 7.9 million and $ 3.9 million, for the three months ended March 31, 2025 and 2024 , respectively.

Sales under bill-and-hold arrangements totaled $ 11.6 million and $ 9.7 million, for the three months ended June 30, 2025 and 2024 , respectively.

Sales under bill-and-hold arrangements totaled $ 19.5 million and $ 13.6 million, for the six months ended June 30, 2025 and 2024 , respectively.

Contract Assets and Contract Liabilities

6 unchanged sentences

Contract assets relate to goods produced without an alternative use for which the Company has an enforceable right to payment but which has not yet been invoiced to the customer.

The majority of the amounts included in contract assets on December 31, 2024 were transferred to accounts receivable during the three months ended March 31, 2025 .

Contract liabilities relate to payments received in advance of the Company completing its performance under a contract.

Contract liabilities are included in other current liabilities in our balance sheets.

During the three months ended March 31, 2025 , $ 2.0 million of revenue was recognized from the contract liabilities balance as of December 31, 2024 .

NOTE 4 – Net (Loss) Income Per Share:

During the six months ended June 30, 2025 , $ 2.4 million of revenue was recognized from the contract liabilities balance as of December 31, 2024 .

NOTE 4 – Net Income Per Share:

The Company’s basic net income per share is computed based on the weighted average number of shares of common stock outstanding for the period.

1 unchanged sentence

The following table presents a reconciliation of basic and diluted net income per share for the periods presented:

Three Months Ended March 31,

Net (loss) income used in the computation of basic and diluted net (loss) income per share (in thousands)

Three Months Ended June 30,

Six Months Ended June 30,

Net income used in the computation of basic and diluted net income per share (in thousands)

$ 1,551 $ 600 $ 793 $ 4,512

2 unchanged sentences

Dilutive common stock equivalents

287,958 548,224 366,873 486,822

Weighted average shares outstanding - diluted

15,101,942 16,769,297 15,573,692 16,611,375

Net (loss) income per share:

Net income per share:

$ 0.10 $ 0.04 $ 0.05 $ 0.28

$ 0.10 $ 0.04 $ 0.05 $ 0.27

Diluted weighted average shares outstanding excludes shares of common stock of 445,786 for the three months ended March 31, 2025, as their inclusion would have been antidilutive given the Company's net loss.

Awards to purchase 304,392 and 400,075 shares of common stock with weighted average exercise prices of $ 21.23 and $ 20.86 per share were outstanding during the three months ended March 31, 2025 and 2024 , respectively, but were not included in the computation of diluted net income per share because the awards’ exercise prices were greater than the average market price of the common shares.

Awards to purchase 689,402 and 295,361 shares of common stock with weighted average exercise prices of $ 16.59 and $ 21.90 per share were outstanding during the three months ended June 30, 2025 and 2024 , respectively, but were not included in the computation of diluted net income per share because the awards’ exercise prices were greater than the average market price of the common shares.

Awards to purchase 496,897 and 347,718 shares of common stock with weighted average exercise prices of $ 18.91 and $ 21.38 per share were outstanding during the six months ended June 30, 2025 and 2024 , respectively, but were not included in the computation of diluted net income per share because the awards’ exercise prices were greater than the average market price of the common shares.

NOTE 5 – Long-Term Debt:

13 unchanged sentences

Obligations outstanding under the Credit Facilities accrue interest at a variable rate equal to the secured overnight financing rate ("SOFR") plus an adjustment between 0.10 % and 0.25 % (depending on the applicable interest period) plus a margin between 1.0 % and 2.0 % (depending on the Company’s net leverage ratio).

The weighted average interest rate on our outstanding borrowings under the Credit Facilities was 5.4 % as of March 31, 2025 .

The weighted average interest rate on our outstanding borrowings under the Credit Facilities was 5.6 % as of June 30, 2025 .

During the term of the revolving credit facility, the Company will pay a commitment fee on the unused portion of the revolving credit facility equal to between 0.125 % and 0.250 % (depending on the Company’s net leverage ratio).

The available balance under the revolving credit facility is reduced by outstanding letters of credit.

As of March 31, 2025 , there were no outstanding letters of credit under the revolving credit facility.

Contractual principal payments for the term loan are as follows:

As of June 30, 2025 , there were no outstanding letters of credit under the revolving credit facility.

Contractual principal payments for the term loan, which does not contain pre-payment penalties, are as follows:

remainder of 2025 - $ 2.8 million;

1 unchanged sentence

and 2027 - $ 52.5 million.

The term loan does not contain pre-payment penalties.

The Credit Facilities are secured by substantially all of the operating assets of the Company, and the Company’s obligations under the Credit Facilities are guaranteed by all of its domestic subsidiaries.

3 unchanged sentences

The Company’s net leverage ratio (as defined in the Credit Agreement) is generally calculated as the ratio of (a) indebtedness minus unrestricted cash to (b) consolidated EBITDA for the four most recently ended fiscal quarters.

As of March 31, 2025 , the Company was in compliance with these ratios.

As of June 30, 2025 , the Company was in compliance with these ratios.

NOTE 6 – Contingencies and Geographic Supply Concentrations:

2 unchanged sentences

(“Guardian”) in May 2022 included contingent consideration based on varying levels of Guardian’s EBITDA in each measurement period through April 2025.

The estimated fair value of Guardian acquisition-related contingent consideration payable as of March 31, 2025 was $ 0.9 million, all of which is expected to be paid in the third quarter of 2025.

The Company will continue to evaluate the Guardian liability for remeasurement at the end of each reporting period and any changes will be recorded in the Company’s statements of comprehensive income.

Actual amounts paid may be different from the estimated value of the liability.

The fair value of Guardian acquisition-related contingent consideration payable as of June 30, 2025 was $ 1.0 million, all of which is expected to be paid in the third quarter of 2025.

The purchase price to acquire substantially all of the assets of 3Point in December 2024 included contingent consideration based on varying levels of the acquired company’s EBITDA in each measurement period through December 2027.

The estimated fair value of the acquired company's acquisition-related contingent consideration payable as of March 31, 2025 was $ 1.1 million, all of which is expected to be paid in the second quarter of 2026.

The estimated fair value of the acquired company's acquisition-related contingent consideration payable as of June 30, 2025 was $ 1.2 million, of which $ 0.9 million is expected to be paid in the second quarter of 2026.

The total payments related to this contingent consideration payable is capped at $ 0.9 million per year and $ 2.6 million over the three year measurement period.

6 unchanged sentences

The majority of such fabrics are sourced, directly or indirectly, from China.

Superior does not have a concentration of suppliers of finished apparel in any single country or region of the world, however, it does contract to manufacture or source the majority of its apparel in the following countries:

Haiti, China, Madagascar, Kenya, Vietnam, Pakistan, Bangladesh, and the United States.

The Company does not have a concentration of suppliers of finished apparel in any single country or region of the world, however, it does contract to manufacture or source the majority of its apparel in the following countries:

Haiti, China, Madagascar, Vietnam, Pakistan, Bangladesh, and the United States.

Additionally, we generally source or manufacture apparel in parts of the world that may be affected by economic uncertainty, political unrest, labor disputes, health emergencies, natural disasters or the imposition of duties, tariffs or other import regulations by the United States.

The Branded Products segment also relies on the supply of other types of finished products including hard goods such as drinkware and injection molded plastics along with raw materials that are principally sourced from China, either directly or indirectly.

During 2025 tariffs, impacting certain sources of the Company's materials and production, were enacted by the U.S.

government, including a higher tariff on finished products from China.

We continue to monitor these enacted tariffs and the ongoing negotiations between the U.S.

During 2025 higher and/or new tariffs impacting certain sources of the Company's materials and production, were imposed by the U.S.

We continue to monitor these imposed tariffs and the ongoing negotiations between the U.S.

government and the countries in which we manufacture, as well as, evaluate sourcing alternatives.

14 unchanged sentences

The accounting estimates used to compute the provision for income taxes may change as new events occur, additional information is obtained or the tax environment changes.

For the three months ended March 31, 2025 , the Company recorded a benefit for income taxes of $ 0.1 million, which represents an effective tax rate of 16.3 %.

The income tax benefit and the effective tax rate for the three months ended March 31, 2025 was primarily impacted by the variability in the mix of earnings across the Company’s foreign and domestic operations, subject to various statutory tax rates in those jurisdictions.

For the three months ended March 31, 2024 , the Company recorded a provision for income taxes of $ 0.7 million, which represents an effective tax rate of 14.8 %.

The income tax provision and the effective tax rate for the three months ended March 31, 2024 was primarily impacted by the variability in the mix of earnings across the Company’s foreign and domestic operations, subject to various statutory tax rates in those jurisdictions as well as the windfall benefits associated with the stock option exercises in the quarter.

For the three months ended June 30, 2025 , the Company recorded tax expense of $ 0.3 million, which represents an effective tax rate of 15.5 %.

For the six months ended June 30, 2025 , the Company recorded tax expense of $ 0.1 million, which represents an effective tax rate of 14.7 %.

The income tax expense and the effective tax rate for the three and six months ended June 30, 2025 were primarily impacted by the variability in the mix of earnings across the Company’s foreign and domestic operations, subject to various statutory tax rates in those jurisdictions.

The tax rate was further favorably impacted by the performance of the Company’s compensation plans during the six months ended June 30, 2025, totaling $ 0.7 million.

For the three months ended June 30, 2024, the Company recorded a provision for income taxes of $ 0.1 million, which represents an effective tax rate of 7.7 %.

For the six months ended June 30, 2024, the Company recorded a provision for income taxes of $ 0.7 million, which represents an effective tax rate of 13.9 %.

The income tax provision and the effective tax rate for the three and six months ended June 30, 2024 was primarily impacted by the variability in the mix of earnings across the Company’s foreign and domestic operations, subject to various statutory tax rates in those jurisdictions.

The tax rate was further favorably impacted by the windfall benefits associated with stock option exercises during the six months ended June 30, 2024, totaling $ 0.5 million.

On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted.

The OBBBA includes significant changes to the domestic and international tax provisions, such as modifications to the global tax framework, the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, and the restoration of favorable tax treatment for certain business provisions.

The legislation has multiple effective dates, with certain provisions effective in 2025 and others implemented through 2027.

The Company is currently evaluating OBBBA's impact on its consolidated financial statements.

NOTE 9 – Other Information :

5 unchanged sentences

( 510 ) ( 1,368 )

Balance at the end of year

Balance at the end of the period

$ 4,691 $ 3,101

10 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements