Superior Group of Companies (SGC) Q3 2024 earnings summary

Executive summary

• Net sales rose 10.0% year-over-year to $149.7 million in Q3 2024, with growth across all segments and record revenues in core products and services.

• Net income increased to $5.4 million from $3.1 million in Q3 2023, with EPS up to $0.33 from $0.19, and EBITDA reached $11.7 million, up from $9.3 million.

• Strategic investments in people, technology, and marketing continued to support market share gains and customer retention.

• Operates three diversified businesses: Healthcare Apparel, Branded Products, and Contact Centers, each in large, growing markets with high demand.

• Maintains strong customer retention and historically high margins, with Contact Centers as the fastest-growing and highest-margin segment.

Financial highlights

• Q3 2024 gross margin improved to 40.4% from 39.1% in Q3 2023, with gross margin dollars at $60.5 million.

• EBITDA for Q3 2024 was $11.7 million, up 25.9% year-over-year, with EBITDA margin expanding to 7.8%.

• Interest expense declined to $1.6 million in Q3 2024 from $2.5 million in Q3 2023, reflecting lower borrowings and rates.

• Operating cash flow for the nine months ended September 30, 2024, was $24.5 million.

• Cash and cash equivalents stood at $18.4 million as of September 30, 2024.

Outlook and guidance

• Full-year 2024 sales outlook reaffirmed at $563–$570 million, up from $543 million in 2023, with EPS guidance of $0.73–$0.79.

• Management expects continued growth opportunities in Branded Products and Healthcare Apparel, and Contact Centers to benefit from nearshore outsourcing trends.

• Management believes current cash, operating cash flow, and credit availability are sufficient for the next 12 months.