EXHIBIT 99.1
NEWS RELEASE
Superior Uniform Group, Inc.
An American Stock Exchange Listed Company
10055 Seminole Boulevard
Seminole, Florida 33772-2539
Telephone (727) 397-9611
Fax (727) 803-9623
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Contact: Andrew D. Demott, Jr., CFO | | FOR IMMEDIATE RELEASE |
(727) 803-7135 | | |
SUPERIOR UNIFORM GROUP, INC. ANNOUNCES YEAR-END OPERATING RESULTS
SEMINOLE, Florida - February 23, 2006 – Superior Uniform Group, Inc. (AMEX: SGC), manufacturer of uniforms, career apparel and accessories, today announced its fourth quarter and year-end operating results for 2005.
The Company announced that for the year ended December 31, 2005, sales were $133,312,351 compared to 2004 sales of $143,567,473. Net income for the year ended December 31, 2005 was $1,244,185 or $.17 per share (diluted) compared to $5,378,687 or $.71 per share (diluted) reported for the year ended December 31, 2004.
Michael Benstock, Chief Executive Officer, commented: “The year ending December 31, 2005 was a very difficult year for the Company. Our operating results were negatively affected by a variety of factors, including challenges associated with a necessary warehouse management system upgrade in our central distribution center, which during that period resulted in severe service interruptions affecting the first half of the year. In the latter part of the year, numerous major hurricanes virtually shut down all of the ports (New Orleans, Gulfport, Houston and Miami), where the vast majority of our finished products arrive weekly from Central America. The warehouse is now operating extremely effectively and there are no additional upgrades planned for the foreseeable future. Hurricanes are something that we have no control over, but we have now developed a plan to stagger the ports where we move our products through during the hurricane season and not depend, as we have for so many years, on New Orleans and Gulfport, which are the closest ports to our Arkansas Central Distribution Facility. We were able, in spite of these setbacks, to lay a much stronger foundation for the Company’s future and are now positioned to return the Company to the levels of profitability and sales growth that our shareholders deserve. During 2005, we accomplished the following major initiatives that will provide significant returns to the Company going forward. We completed the upgrade of the warehouse system at our central warehouse facility allowing us to consolidate substantially all of the distribution operations of the
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Company into this one location. We released our largest-ever catalog,Defining Uniforms, with a greatly expanded line of quality uniforms and image apparel related to several of our focal markets, particularly Hospitality and Healthcare. We utilized our 2004 acquisition of UniVogue and this new catalog line as a platform to substantially increase our market share in the Hospitality market. We entered into agreements with a number of major hotel chains, state government agencies and buying groups and developed marketing materials to support our sales efforts in these markets. We continued to develop our sourcing networks around the globe to better meet the competitive requirements of our customers and markets. We streamlined our operations and were able to substantially reduce our workforce. We reduced our inventory levels and generated approximately $11 million in cash from operating activities. We ended the year with over $3.2 million in cash on hand and have continued to build cash during the first quarter of 2006. We laid a more stable foundation for our Company and are now positioned to reap the rewards of our hard work. I know it has been difficult on our shareholders as we have worked through these issues. However, I truly believe we are positioned to have a tremendous year in 2006.”
Superior Uniform Group®, through its Signature marketing brands – Fashion Seal®, Fashion Seal Healthcare™, Martin’s®, Worklon®, Sope Creek® and UniVogue™ – manufactures and sells a wide range of uniforms, image apparel and accessories. Superior specializes in managing comprehensive uniform programs, and is dedicated to servicing the Healthcare, Hospitality, Restaurant/Food Services, Retail Employee I.D., Governmental/Public Safety, Entertainment, Commercial, Transportation, Cleanroom, Corporate Identity and Resortwear markets. For more information, please visitwww.superioruniformgroup.com.
Statements contained in this press release which are not historical facts may constitute forward-looking statements as that term is defined in the Private Securities Litigation Reform Act of 1995. All forward-looking statements are subject to risks and uncertainties, including without limitation those identified in the Company’s SEC filings, which could cause actual results to differ from those projected.
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Comparative figures for 2005 and 2004 are as follows:
Superior Uniform Group, Inc. and Subsidiary
Consolidated Summary of Operations
| | | | | | | |
| | | Three Months Ended December 31, |
| | | (Unaudited) |
| | | 2005 | | | 2004 |
Net sales | | $ | 32,402,347 | | | $ | 37,441,823 |
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Costs and expenses: | | | | | | | |
Cost of goods sold | | | 23,687,402 | | | | 25,402,481 |
Selling and administrative expenses | | | 8,501,455 | | | | 10,199,040 |
Interest expense | | | 143,828 | | | | 152,529 |
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| | | 32,332,685 | | | | 35,754,050 |
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Earnings before taxes on income | | | 69,659 | | | | 1,687,773 |
Taxes on income | | | (230,000 | ) | | | 520,000 |
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Net earnings | | $ | 299,659 | | | $ | 1,167,773 |
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Basic net earnings per common share | | $ | 0.04 | | | $ | 0.16 |
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Diluted net earnings per common share | | $ | 0.04 | | | $ | 0.15 |
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Dividends per common share | | $ | 0.135 | | | $ | 0.135 |
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Superior Uniform Group, Inc. and Subsidiary
Consolidated Summary of Operations
| | | | | | |
| | | Twelve Months Ended December 31, |
| | | (Unaudited) |
| | | 2005 | | 2004 |
Net sales | | $ | 133,312,351 | | $ | 143,567,473 |
| | | | | | |
Costs and expenses: | | | | | | |
Cost of goods sold | | | 93,596,828 | | | 96,279,784 |
Selling and administrative expenses | | | 37,610,557 | | | 38,524,803 |
Interest expense | | | 610,781 | | | 624,199 |
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| | | 131,818,166 | | | 135,428,786 |
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Earnings before taxes on income | | | 1,494,185 | | | 8,138,687 |
Taxes on income | | | 250,000 | | | 2,760,000 |
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Net earnings | | $ | 1,244,185 | | $ | 5,378,687 |
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Basic net earnings per common share | | $ | 0.17 | | $ | 0.72 |
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Diluted net earnings per common share | | $ | 0.17 | | $ | 0.71 |
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Dividends per common share | | $ | 0.54 | | $ | 0.54 |
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Superior Uniform Group, Inc. and Subsidiary
Consolidated Balance Sheets
December 31,
| | | | | | |
| | | 2005 | | 2004 |
ASSETS (Unaudited) | | | | | | |
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CURRENT ASSETS | | | | | | |
Cash and cash equivalents | | $ | 3,220,174 | | $ | 150,563 |
Accounts receivable | | | 25,706,970 | | | 26,938,861 |
Inventories | | | 37,186,779 | | | 45,741,410 |
Other current assets | | | 2,765,979 | | | 2,632,918 |
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TOTAL CURRENT ASSETS | | | 68,879,902 | | | 75,463,752 |
PROPERTY, PLANT AND EQUIPMENT, NET | | | 18,079,292 | | | 22,062,359 |
GOODWILL | | | 1,617,411 | | | 1,617,411 |
OTHER INTANGIBLE ASSETS | | | 1,250,333 | | | 1,488,492 |
OTHER ASSETS | | | 7,434,119 | | | 7,322,229 |
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| | $ | 97,261,057 | | $ | 107,954,243 |
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| LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | |
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CURRENT LIABILITIES | | | | | | |
Accounts payable | | $ | 6,046,575 | | $ | 8,852,713 |
Accrued expenses | | | 3,182,159 | | | 3,761,660 |
Current portion of long-term debt | | | 1,683,029 | | | 1,593,807 |
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TOTAL CURRENT LIABILITIES | | | 10,911,763 | | | 14,208,180 |
LONG-TERM DEBT | | | 3,979,540 | | | 5,662,569 |
DEFERRED INCOME TAXES | | | 845,000 | | | 1,015,000 |
COMMITMENTS AND CONTINGENCIES | | | | | | |
TOTAL SHAREHOLDERS’ EQUITY | | | 81,524,754 | | | 87,068,494 |
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| | $ | 97,261,057 | | $ | 107,954,243 |
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