10q10k10q10k.net

What changed in SUPERIOR GROUP OF COMPANIES, INC.'s 10-K — 2024 vs 2025

vs

Paragraph-level year-over-year comparison of SUPERIOR GROUP OF COMPANIES, INC.'s 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+149 added−143 removedSource: 10-K (2026-03-03) vs 10-K (2025-03-11)

Top changes in SUPERIOR GROUP OF COMPANIES, INC.'s 2025 10-K

149 paragraphs added · 143 removed · 112 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

14 edited+2 added−5 removed27 unchanged
Biggest changeBranded products are manufactured through third parties or in Superior’s own facilities, and are sold to customers in a wide range of industries, including chain retail, food service, entertainment, technology, transportation and a wide range of other industries. The segment currently has sales offices in the United States and Brazil, with support services in China and India.
Biggest changeSuperior’s Branded Products segment, primarily through its signature marketing brands BAMKO® and HPI®, produces and sells customized merchandising solutions, promotional products and branded uniform programs. Branded products are manufactured through third parties or in Superior’s own facilities, and are sold to customers in a wide range of industries, including retail chain, food service, entertainment, technology, transportation and other industries.
Item 1. Business Overview Superior Group of Companies, Inc. (together with its subsidiaries, “the Company,” “Superior,” “we,” “our,” or “us”) 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. and redomiciled to Florida.
Item 1. Business Overview Superior Group of Companies, Inc. (together with its subsidiaries, “the Company,” “Superior,” “we,” “our,” or “us”) was organized in 1920 and was incorporated in 1922 as a New York company under the name Superior Surgical Mfg. Co., Inc. In 1998, Superior Surgical Mfg. Co. changed its name to Superior Uniform Group, Inc. and redomiciled to Florida.
During the years ended December 31, 2024 and 2023, our Contact Centers segment accounted for approximately 17% and 16%, respectively of net sales. 3 Table of Contents Competition Superior competes in its Branded Products segment with a multitude of national and regional companies, such as, BDA, Inc., HALO Branded Solutions, Inc., Staples, Inc., Cimpress PLC, HH Global Group Limited, Lands’ End, Inc. and Workwear Outfitters, LLC.
During the years ended December 31, 2025 and 2024, our Contact Centers segment accounted for approximately 16% and 17%, respectively of net sales. 3 Table of Contents Competition Superior competes in its Branded Products segment with a multitude of national and regional companies, such as, BDA, Inc., HALO Branded Solutions, Inc., Staples, Inc., Cimpress PLC, HH Global Group Limited, Lands’ End, Inc. and Workwear Outfitters, LLC.
For a depiction of net sales from external customers and Segment EBITDA by segment for the years ended December 31, 2024 and 2023, please refer to Note 2 to our Consolidated Financial Statements included in Part II, Item 8 (“Financial Statements and Supplementary Data”) (collectively referred to as “Financial Statements,” and individually referred to as “statements of comprehensive income (loss),” “balance sheets,” “statements of shareholders’ equity,” and “statements of cash flows” herein).
For a depiction of net sales from external customers and Segment EBITDA by segment for the years ended December 31, 2025 and 2024, please refer to Note 2 to our Consolidated Financial Statements included in Part II, Item 8 (“Financial Statements and Supplementary Data”) (collectively referred to as “Financial Statements,” and individually referred to as “statements of comprehensive income (loss),” “balance sheets,” “statements of shareholders’ equity,” and “statements of cash flows” herein).
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 our Contact Centers segment operates has evolved into a global multi-billion dollar marketplace that is highly competitive and fragmented.
We believe that the strength of our brands and marketing, coupled with the quality of our products, allows us to compete effectively. The market in which our Contact Centers segment operates has evolved into a global multi-billion dollar marketplace that is highly competitive and fragmented.
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”).
We make available on or through our website certain reports and amendments to those reports that we file with or furnish to the SEC in accordance with the Securities Exchange Act of 1934, as amended (the “Exchange Act”).
During the years ended December 31, 2024 and 2023, our Branded Products segment accounted for approximately 62% and 63%, respectively, of net sales. During the years ended December 31, 2024 and 2023, our Healthcare Apparel segment accounted for approximately 21% and 21%, respectively, of net sales. For more information on our reportable business segments, please refer to “ Item 7.
During the years ended December 31, 2025 and 2024, our Branded Products segment accounted for approximately 64% and 62%, respectively, of net sales. During the years ended December 31, 2025 and 2024, our Healthcare Apparel segment accounted for approximately 20% and 21%, respectively, of net sales. For more information on our reportable business segments, please refer to “ Item 7.
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. 2 Table of Contents Products The Company produces and manufactures (through third parties or in its own facilities) and sells a wide range of promotional products and branded uniforms in its Branded Products segment and healthcare apparel and accessories in its Healthcare Apparel segment.
Superior’s Contact Centers segment, through multiple The Office Gurus® entities (collectively, "TOG"), including subsidiaries in El Salvador, Belize, Dominican Republic, the United States and Jamaica until its closure on June 15, 2025, provides outsourced, nearshore and onshore business process outsourcing, contact and call-center support services to North American customers. 2 Table of Contents Products The Company produces and manufactures (through third parties or in its own facilities) and sells a wide range of promotional products and branded uniforms in its Branded Products segment and healthcare apparel and accessories in its Healthcare Apparel segment.
Superior’s Healthcare Apparel segment, primarily through its signature marketing brands Fashion Seal Healthcare®, CID Resources and Wink®, and its license with Carhartt® manufactures (through third parties or in its own facilities) and sells a wide range of healthcare apparel, such as scrubs, lab coats, protective apparel and patient gowns.
Superior’s Healthcare Apparel segment, primarily through its portfolio of brands Wink® and Fashion Seal Healthcare®, its trade name CID Resources and its license of Carhartt Medical, manufactures (through third parties or in its own facilities) and sells a wide range of healthcare apparel, such as scrubs, lab coats, protective apparel and patient apparel.
This segment sells healthcare service apparel to healthcare laundries, dealers, distributors and physical and e-commerce retailers primarily in the United States.
This segment sells its products to healthcare laundries, dealers, distributors, retailers and consumers primarily in the United States.
Management ’ s Discussion and Analysis of Financial Condition and Results of Operations – Business Outlook, ” which disclosure is incorporated herein by reference. Services Through the recruitment and employment of highly qualified English, Spanish and bilingual-speaking agents, we provide outsourced, nearshore business process outsourcing, contact and call-center support services to North American customers in our Contact Centers segment.
Services Through the recruitment and employment of highly qualified English, Spanish and bilingual-speaking agents, we provide outsourced, nearshore and onshore business process outsourcing, contact and call-center support services to North American customers in our Contact Centers segment.
As of December 31, 2024, the Company had approximately 7,200 employees worldwide, of which approximately 7,100 were full-time employees and approximately 100 were part-time employees. As of December 31, 2024, approximately 820 employees were employed in the U.S. and approximately 6,380 employees were employed in foreign countries.
As of December 31, 2025, the Company had approximately 6,520 employees worldwide, of which all were full-time employees. As of December 31, 2025, approximately 720 employees were employed in the U.S. and approximately 5,800 employees were employed in foreign countries.
Available Information The Company maintains an internet website at the following address: www.superiorgroupofcompanies.com. The information on the Company’s website is not incorporated by reference in this annual report on Form 10-K.
The Contact Centers segment has the Company’s largest labor force at approximately 3,900 employees as of December 31, 2025. 5 Table of Contents Available Information The Company maintains an internet website at the following address: www.superiorgroupofcompanies.com. The information on the Company’s website is not incorporated by reference in this annual report on Form 10-K.
In 2018, the Company changed its name to Superior Group of Companies, Inc. Superior is comprised of three reportable business segments: (1) Branded Products, (2) Healthcare Apparel, and (3) Contact Centers. Superior’s Branded Products segment, primarily through its signature marketing brands BAMKO® and HPI®, produces and sells customized merchandise, promotional products and branded uniform programs.
Effective on May 3, 2018, Superior Uniform Group, Inc. changed its name to Superior Group of Companies, Inc. Superior is comprised of three reportable business segments: (1) Branded Products, (2) Healthcare Apparel, and (3) Contact Centers.
Removed
Customers Branded Products and Contact Center segments have a substantial number of customers, none of which accounted for more than 10% of either segment’s 2024 net sales. Our Healthcare Apparel segment has one customer who accounts for 10% of the segment’s 2024 net sales.
Added
The segment currently has sales offices or operations in the United States, Canada and Brazil, with support services in China and India.
Removed
The Contact Centers segment has the Company’s largest labor force at approximately 4,300 employees as of December 31, 2024. 5 Table of Contents Recent Acquisitions On December 4, 2024, the Company, through BAMKO, acquired substantially all of the assets of Cormark Inc. doing business as 3Point Brand Management ("3Point or acquired company"), for a total purchase price of $6.4 million.
Added
Management ’ s Discussion and Analysis of Financial Condition and Results of Operations – Business Outlook, ” which disclosure is incorporated herein by reference.
Removed
The acquired company is an advertising company that specializes in creating a brand for some the country’s biggest brands through apparel, promotional marketing and other products.
Removed
The purchase price for the acquisition consisted of the following: (a) $4.0 million of cash consideration, (b) the issuance of 89,445 restricted shares of Superior’s common stock valued at $1.5 million, and (c) estimated contingent future payments of $0.9 million based on the results of the acquired business through December 2027.
Removed
The restricted shares vest ratably over a three-year period and are subject to transfer restrictions. The total payments related to the contingent future payment is capped at $0.9 million per year and $2.6 million over the three year measurement period. Total goodwill recorded in connection with the acquisition was $2.3 million, and assigned to the Branded Products reportable segment.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

33 edited+8 added−9 removed119 unchanged
Biggest changeThese accounting principles require that we record an impairment charge if circumstances indicate that the asset carrying values exceed their estimated fair values. For example, during the year ended December 31, 2022, the Company recorded non-cash goodwill and indefinite lived trade name impairment charges totaling $45.9 million and $5.6 million, respectively.
Biggest changeWe assess our intangible assets, long-lived assets and goodwill for impairment when required by generally accepted accounting principles in the United States (“GAAP”). These accounting principles require that we record an impairment charge if circumstances indicate that the asset carrying values exceed their estimated fair values.
The prices we pay for these fabrics and components are dependent on the market price for the raw materials used to produce them, including cotton and chemical components of synthetic fabrics including raw materials such as chemicals and dyestuffs, in addition to any import duties imposed on those fabrics and components that are imported.
The prices we pay for these fabrics and components are dependent on the market price for the raw materials used to produce them, including cotton and chemical components of synthetic fabrics including such raw materials as chemicals and dyestuffs, in addition to any import duties imposed on those fabrics and components that are imported.
Such events may interfere with our manufacturing processes, information systems, telecommunication services, and product delivery for sustained periods and may also may make it difficult or impossible for employees to reach our business locations.
Such events may interfere with our manufacturing processes, information systems, telecommunication services, and product delivery for sustained periods and may also make it difficult or impossible for employees to reach our business locations.
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), the Middle East Free Trade Area Initiative (MEFTA) and the activities and regulations of the World Trade Organization (WTO).
Our operations are subject to various international trade agreements, regulations and preferences, 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), the Middle East Free Trade Area Initiative (MEFTA) and the activities and regulations of the World Trade Organization (WTO).
There also is no guarantee that we will be able to negotiate and conclude extensions of existing license agreements on similar economic terms or at all. 7 Table of Contents Our customers may cancel or decrease the quantity of their orders, which could negatively impact our operating results. Sales to many of our customers are on an order-by-order basis.
There is no guarantee that we will be able to negotiate and conclude extensions of existing license agreements on similar economic terms or at all. 7 Table of Contents Our customers may cancel or decrease the quantity of their orders, which could negatively impact our operating results. Sales to many of our customers are on an order-by-order basis.
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.
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 may also influence the prices of related items such as chemicals, dyestuffs and polyester yarn.
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, from time to time, experienced significant changes and difficulties, including consolidation of ownership, increased centralization of buying decisions, buyer turnover, restructurings, bankruptcies and liquidations.
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, from time to time, experienced significant changes and difficulties, including changes in ownership, increased centralization of buying decisions, buyer turnover, restructurings, bankruptcies and liquidations.
An inability to meet customer demand and delays in the delivery of our products to our customers could result in reputational harm and damaged customer relationships and have an adverse effect on our business, financial condition and results of operations. 8 Table of Contents We pursue acquisitions from time-to-time to expand our business, which may pose risks to our business.
An inability to meet customer demand or delays in the delivery of our products to our customers could result in reputational harm and damaged customer relationships and have an adverse effect on our business, financial condition and results of operations. 8 Table of Contents We pursue acquisitions from time-to-time to expand our business, which may pose risks to our business.
Payment of cash dividends on our common stock is subject to our compliance with applicable law and depends on, among other things, our results of operations, financial condition, level of indebtedness, capital requirements, contractual restrictions, business prospects and other factors that our board of directors may deem relevant.
Payment of cash dividends on our common stock is subject to our compliance with applicable law and depends on, among other things, our results of operations, financial condition, level of indebtedness, capital requirements, contractual restrictions, business prospects and other factors that our Board may deem relevant.
See “Changes to trade regulation, quotas, duties, tariffs or other restrictions caused by the changing U.S. and geopolitical environments or otherwise, such as those with respect to China, which may materially harm our revenue and results of operations, such as by increasing our costs and/or limiting the amount of products that we can import.” Furthermore, the Company and the Company’s suppliers generally source or manufacture finished goods in parts of the world that have been and may be in the future affected by economic uncertainty, political unrest, logistical challenges (such as port strikes and embargos), foreign currency fluctuations, labor disputes, health emergencies, natural disasters, or the imposition of duties, tariffs or other import regulations by the United States or other countries, any of which could result in additional cost or limit our supply of necessary goods and raw materials.
See “Risks Relating to Our Industries - Changes to trade regulation, quotas, duties, tariffs or other restrictions caused by the changing U.S. and geopolitical environments or otherwise, such as those with respect to China, which may materially harm our revenue and results of operations, such as by increasing our costs and/or limiting the amount of products that we can import.” Furthermore, the Company and the Company’s suppliers generally source or manufacture finished goods in parts of the world that have been and may be in the future affected by economic uncertainty, political unrest, logistical challenges (such as port strikes and embargos), foreign currency fluctuations, labor disputes, health emergencies, natural disasters, or the imposition of duties, tariffs or other import regulations by the United States or other countries, any of which could result in additional cost or limit our supply of necessary goods and raw materials.
The trading price of our common stock, as reported on the Nasdaq Stock Market, could fluctuate due to a number of factors such as those listed in “Risks Relating to Our Business” and include, but are not limited to, the following, some of which are beyond our control: • quarterly variations in our results of operations; • results of operations that vary from the expectations of securities analysts and investors; • results of operations that vary from those of our competitors; • changes in expectations as to our future financial performance, including financial estimates by securities analysts and investors; • announcements by us, our competitors or our vendors of significant contracts, acquisitions, divestitures, joint marketing relationships, joint ventures or capital commitments; • announcements by third parties of significant claims or proceedings against us; and • general domestic and international economic conditions.
The trading price of our common stock, as reported on the Nasdaq Stock Market, fluctuates due to a number of factors such as those listed in “Risks Relating to Our Business” which may include, but not be limited to, the following, some of which are beyond our control: • quarterly variations in our results of operations; • results of operations that vary from the expectations of securities analysts and investors; • results of operations that vary from those of our competitors; • changes in expectations as to our future financial performance, including financial estimates by securities analysts and investors; • announcements by us, our competitors or our vendors of significant contracts, acquisitions, divestitures, joint marketing relationships, joint ventures or capital commitments; • announcements by third parties of significant claims or proceedings against us; and • general domestic and international economic conditions.
Furthermore, if any of our customers experience a significant downturn in their business, or fail to remain committed to our programs or brands, the customers may reduce or discontinue purchases from us, which has happened.
Furthermore, if any of our customers experience a significant downturn in their business, or fail to remain committed to our programs or brands, such customers may reduce or discontinue purchases from us, which has happened.
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 , results of operations and/or financial condition could suffer.
Any future issuances of equity securities or convertible debt securities 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 , results of operations and/or financial condition could suffer.
Conversely, if we underestimate customer demand, our suppliers and manufacturers may not be able to deliver products to meet our requirements, and we may be subject to higher costs in order to secure the necessary production capacity or we may incur increased shipping costs.
Conversely, if we underestimate customer demand, our suppliers and manufacturers may not be able to deliver products to meet our requirements or we may be subject to higher production or shipping costs in order to secure the necessary production.
As a result, we have had to increase prices for certain products and may be required to raise those prices further, or raise our prices on other products, which may result in the loss of customers and harm our operating performance.
As a result, we have increased our prices for certain products and may be required to raise those prices further, or raise our prices on other products, which may result in the loss of customers and harm our operating performance.
However, if one or more additional material weaknesses or significant deficiencies in our internal control over financial reporting are discovered or occur in the future, or our disclosure controls and procedures are determined to be ineffective, we may not be able to prevent or identify irregularities or ensure the fair and accurate presentation of our financial statements included in our periodic reports filed with the U.S.
If any material weaknesses or significant deficiencies in our internal control over financial reporting are discovered or occur in the future, or our disclosure controls and procedures are determined to be ineffective, we may not be able to prevent or identify irregularities or ensure the fair and accurate presentation of our financial statements included in our periodic reports filed with the U.S.
In the event that payments become due under the SERP, we will have to use cash flow from operations or other sources to fund our obligations. As of December 31, 2024, we had $13.6 million in unfunded obligations related to the SERP. 15 Table of Contents Risks Relating to Our Common Stock Certain existing shareholders have significant control.
In the event that payments become due under the SERP, we will have to use cash flow from operations or other sources to fund our obligations. As of December 31, 2025, we had $15.4 million in unfunded obligations related to the SERP. 15 Table of Contents Risks Relating to Our Common Stock Certain existing shareholders have significant control.
We are subject to international, federal, national, regional, state, local and other laws and regulations affecting our business, including but not limited to 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, the Food, Drug, and Cosmetic Act, the rules and regulations of the Food and Drug Administration (FDA), various anti-corruption and anti-bribery laws, various securities laws and regulations including but not limited to the Securities Exchange Act of 1934, the Securities Act of 1933, and the rules of the Nasdaq Stock Market LLC, various labor, workplace and related laws, and environmental laws and regulations.
We are subject to international, federal, national, regional, state, local and other laws and regulations affecting our business, including but not limited to 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, the Food, Drug, and Cosmetic Act, the rules and regulations of the Food and Drug Administration (FDA), various anti-corruption and anti-bribery laws, various securities laws and regulations including but not limited to the Exchange Act, the Securities Act of 1933, and the rules of the Nasdaq Stock Market on which our common stock is traded, various labor, workplace and related laws, and environmental laws and regulations.
Please see “ Our results of operations could be adversely affected by economic and political conditions globally and the effects of these conditions on our customers ’ businesses and levels of business activity ” above for a description of recent inflationary pressure.
Please see “Risks Related to Our Industries - Our results of operations could be adversely affected by economic and political conditions globally and the effects of these conditions on our customers ’ businesses and levels of business activity ” above for a description of recent inflationary pressure.
However, trade agreements and regulations can also impose requirements that have a material adverse effect on our business, revenue and results of operations, such as limiting the countries from which we can purchase raw materials, limiting the products that qualify as duty free, and setting quotas, duties and/or tariffs on products that may be imported into the United States from a particular country.
Generally, these trade agreements, regulations and preferences benefit our business, but trade agreements and regulations can also impose requirements that have a material adverse effect on our business, revenue and results of operations, such as limiting the countries from which we can purchase raw materials, limiting the products that qualify as duty free, and setting quotas, duties and/or tariffs on products that may be imported into the United States from a particular country.
Certain inbound products in our Branded Products and Healthcare Apparel segments to the United States are subject to tariffs assessed on the manufactured cost of goods at the time of import.
Furthermore, certain inbound products in our Branded Products and Healthcare Apparel segments are subject to tariffs assessed on the manufactured cost of goods at the time of import.
If our assessment of intangible assets or long-lived assets indicates an impairment of the carrying value for which we recognize an impairment charge, this may adversely affect our financial condition and results of operations, potentially materially so.
If our assessment of intangible assets, long-lived assets or goodwill indicates an impairment of the carrying value for which we recognize an impairment charge, this may adversely affect our financial condition and results of operations, potentially materially so. 19 Table of Contents
We selectively pursue acquisitions from time-to-time as part of our growth strategy. We compete with others within our industries for suitable acquisition candidates. This competition may increase the price of 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.
We selectively pursue acquisitions from time-to-time as part of our growth strategy. We compete with other companies for suitable acquisition candidates, and this competition may increase the price of 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.
We may face increased competition from these competitors as they mature and expand their capabilities. 14 Table of Contents Risks Relating to Our Indebtedness and Retirement Plan Obligations Our indebtedness may limit cash flow available to invest in the ongoing needs of our business. As of December 31, 2024, our total consolidated indebtedness was $86.0 million.
We may face increased competition from these competitors as they mature and expand their capabilities. 14 Table of Contents Risks Relating to Our Indebtedness and Retirement Plan Obligations Our indebtedness may limit cash flow available to invest in the ongoing needs of our business. As of December 31, 2025, our total consolidated indebtedness was $93.7 million.
Conflicts in the Middle East, prolonged inflationary conditions, high and/or increased interest rates, additional sanctions or retaliatory measures related to the Russia-Ukraine crisis, or other situations, could further negatively affect U.S. and international commerce and exacerbate or prolong the period of high energy prices.
Conflicts in the Middle East, prolonged inflationary conditions, supply imbalances of oil and natural gas, high and/or increased interest rates, additional sanctions or retaliatory measures related to the Russia-Ukraine crisis or the U.S.-Israeli - Iran crisis, or other situations, could further negatively affect U.S. and international commerce and exacerbate or prolong the period of high energy prices.
At December 31, 2024, our executive officers and directors, and certain of their family members collectively owned approximately 27.6% of our outstanding common stock.
At December 31, 2025, our executive officers and directors, and certain of their family members collectively owned approximately 29.6% of our outstanding common stock.
Further, lower than forecasted demand could result in excess manufacturing capacity or reduced manufacturing efficiencies, which could result in lower margins.
Further, lower than forecasted demand could result in excess manufacturing capacity, reduced manufacturing efficiencies and/or excess inventories purchased from third parties, which could result in lower margins.
Changes to trade regulation, quotas, duties, tariffs or other restrictions caused by the changing U.S. and geopolitical environments or otherwise, such as those with respect to China, which may materially harm our revenue and results of operations, such as by increasing our costs and/or limiting the amount of products that we can import.
Changes to trade agreements, regulations, tariffs, duties, quotas or other restrictions caused by the changing U.S. and geopolitical environments or otherwise, may materially harm our business, results of operations, financial position and/or cash flows. such as by increasing our costs and/or limiting the amount of products that we can import.
Any increase in the amount of taxation incurred as a result of challenges to our tax filing positions could result in a material adverse effect on our business, results of operations and financial condition. 18 Table of Contents
Any increase in the amount of taxation incurred as a result of challenges to our tax filing positions could result in a material adverse effect on our business, results of operations and financial condition. 18 Table of Contents We may identify a material weakness in internal control in the future, which could result in us not preventing or detecting on a timely basis a material misstatement of the Company’s financial statements.
Securities and Exchange Commission or other regulatory authorities, shareholder lawsuits, a loss of investor confidence and damage to our reputation. 16 Table of Contents Our share price may change significantly, and our shareholders may not be able to resell shares of our common stock at or above the price they paid or at all, and they could lose all or part of their investment as a result.
As a result, our executive officers and directors, and certain of their family members, have significant influence over the election of our Board of Directors (the "Board" or "Board of Directors"), the approval or disapproval of any other matters requiring shareholder approval, and the affairs and policies of our company. 16 Table of Contents Our share price may change significantly, and our shareholders may not be able to resell shares of our common stock at or above the price they paid or at all, and they could lose all or part of their investment as a result.
In response, in part, to tariffs levied on products imported from China we have shifted some production out of China and may seek to shift additional production out of China, which may result in additional costs and disruption to our operations. 13 Table of Contents 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.
In response, in part, to tariffs levied on products imported from China we have shifted some production, and may seek to shift additional production, out of China, which may result in additional costs and disruption to our operations.
In addition, the conflict in the Middle East could affect oil prices and have other effects on the global economy. Both crises have potentially far-reaching impacts on energy and food markets and global trade.
Both of these crises have potentially far-reaching impacts on energy and food markets and global trade.
We have recognized, and may recognize in the future, impairment charges, which could materially adversely affect our financial condition and results of operations. We assess our intangible assets and long-lived assets for impairment when required by generally accepted accounting principles in the United States (“GAAP”).
Securities and Exchange Commission or other regulatory authorities, shareholder lawsuits, a loss of investor confidence and damage to our reputation. We have recognized, and may recognize in the future, impairment charges, which could materially adversely affect our financial condition and results of operations.
Removed
Generally, these trade agreements and regulations benefit our business by reducing or eliminating the quotas, duties and/or tariffs assessed on products manufactured in a particular country.
Added
In addition, the joint U.S.-Israeli strikes on Iran in February 2026, as well as other conflicts in the Middle East, could lead to higher oil prices, create supply imbalances in the global markets for oil and natural gas, and have other adverse effects on the global economy.
Removed
These countries also may 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.
Added
To the extent trade agreements benefit our business, we can give no assurances that these benefits will continue to the same extent or at all.
Removed
We cannot assure that future trade agreements or regulations 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.
Added
The African Growth and Opportunity Act (AGOA), Haitian Hemispheric Opportunity through Partnership Encouragement Act (HOPE) and Haiti Economic Lift Program of 2010 (HELP) expired on September 30, 2025 and in February 2026 were retroactively extended until December 31, 2026.
Removed
Nor can we assure 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. In fact, effective February 4, 2025 and March 4, 2025, the U.S. government imposed additional tariffs on certain countries, including China, from which we source products and raw materials.
Added
If these or other agreements and/or preferences with respect to countries in which we operate are not renewed and/or extended, if these or other agreements and/or preferences are changed, or if limits or restrictions under such agreements or regulations are expanded, the cost of continuing to do business in these countries could materially and adversely impact our results of operations, financial position and cash flows. 13 Table of Contents In addition, beginning in the second quarter of 2025, significant new and expanded tariffs, reciprocal tariffs and other trade restrictions were imposed by the United States, with selective tariff exemptions, impacting global trade.
Removed
It may decide to impose or alter those or other import quotas, duties, tariffs or other restrictions on countries from which we source products and/or raw materials or in which we manufacture our products, including China and countries in Latin America.
Added
We purchase or manufacture our products largely in Haiti, China, Madagascar, Vietnam, Pakistan and Bangladesh. The introduction, expansion or continuation of U.S. tariffs on countries from which we source and/or manufacture products, such as China and Vietnam, could have a material adverse impact on our results of operations, financial position and cash flows.
Removed
Any such quotas, duties, tariffs or restrictions could have a material adverse effect on our business, results of operations or financial condition.
Added
More generally, if the imposition of or change in tariffs, duties, quotas, regulations or other restrictions, or if the expiration or change of trade agreements or preferences, involving the United States and countries in which our products are manufactured or into which they are imported, increases our costs, and we are unable to share the cost increases with our suppliers or third-party manufacturers or pass along the remaining cost increases to our customers, our results of operations, financial position and/or cash flows may be materially adversely affected.
Removed
As a result, our executive officers and directors, 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.
Added
As a result, we may decide to move sourcing and/or manufacturing from the affected countries to countries with more favorable cost structures, which such a move may result in material costs and disrupt our operations.
Removed
While we have remediated the material weakness identified in 2023 and 2022, we may identify a material weakness in internal control in the future, which could result in us not preventing or detecting on a timely basis a material misstatement of the Company’s financial statements.
Added
For example, recent tax legislation and regulation, including provisions of the 2025 One Big Beautiful Bill Act (“OBBBA”) and potential increases in taxes, make significant changes to the U.S. tax regime and could materially impact how our earnings are taxed.
Removed
We reported a material weakness relating to segregation of duties, change management and user access within certain proprietary information technology systems of the Contact Centers segment in 2023 and 2022. This material weakness has been remediated as of December 31, 2024.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

2 edited+0 added−0 removed0 unchanged
Biggest changeItem 1C. Cybersecurity 19 Item 2. Properties 20 Item 3. Legal Proceedings 20 Item 4. Mine Safety Disclosures 20 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 21 Item 6. Reserved 21 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 22 Item 7A.
Biggest changeItem 1C. Cybersecurity 20 Item 2. Properties 21 Item 3. Legal Proceedings 21 Item 4. Mine Safety Disclosures 21 PART II Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 22 Item 6. Reserved 23 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 24 Item 7A.
Quantitative and Qualitative Disclosures About Market Risk 33 Item 8. Financial Statements and Supplementary Data 34
Quantitative and Qualitative Disclosures About Market Risk 34 Item 8. Financial Statements and Supplementary Data 35

Item 2. Properties

Properties — owned and leased real estate

1 edited+0 added−0 removed2 unchanged
Biggest changeItem 2. Properties The following table describes the material facilities we owned or leased as of December 31, 2024: Location Status Square Feet Uses St.
Biggest changeItem 2. Properties The following table describes the material facilities we owned or leased as of December 31, 2025: Location Status Square Feet Uses St.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

4 edited+3 added−4 removed2 unchanged
Biggest changePeriod Total Number of Shares Purchased Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (1) October 1, 2024 to October 31, 2024 67,713 $ 14.96 67,713 November 1, 2024 to November 30, 2024 3,973 15.03 3,973 December 1, 2024 to December 31, 2024 - - - Total 71,686 14.96 71,686 $2,580,426 (1) On August 9, 2024, the Company’s Board of Directors approved a new stock repurchase plan.
Biggest changePeriod Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased (1) as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (2) October 1, 2025 to October 31, 2025 - $ - - November 1, 2025 to November 30, 2025 167,806 9.15 167,806 December 1, 2025 to December 31, 2025 67,980 9.93 67,980 Total 235,786 9.37 235,786 $10,105,255 (1) For the three months ended December 31, 2025 there were no shares tendered by employees in connection with the exercise of stock options under the Company's shareholder-approved 2022 Equity Incentive and Awards Plan.
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.” We declared aggregate cash dividends of $0.56 per share during the fiscal year ended December 31, 2024, which were paid in the first, second, third and fourth quarters of 2024.
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.” We declared aggregate cash dividends of $0.56 per share during the fiscal year ended December 31, 2025, which were paid in the first, second, third and fourth quarters of 2025.
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.” Issuer Purchases o f Equity Securities The table below sets forth information with respect to purchases made by or on behalf of Superior Group of Companies, Inc. or any “affiliated purchaser” (as defined in Rule 10b-18(a)(3) under the Exchange Act) of our common stock during the three months ended December 31, 2024.
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.” Issuer Purchases o f Equity Securities The table below sets forth information with respect to purchases made by or on behalf of the Company or any “affiliated purchaser” (as defined in Rule 10b-18(a)(3) under the Exchange Act) of our common stock during the three months ended December 31, 2025.
The Company is in full compliance with all terms, conditions and covenants of such agreement. On February 28, 2025, we had 115 shareholders of record.
The Company is in full compliance with all terms, conditions and covenants of such agreement. On February 28, 2026, we had 109 shareholders of record.
Removed
Under the plan, the Company is authorized to repurchase up to $10 million of its common stock over a period of one year ending in August 2025.
Added
(2) On September 19, 2025, the Company entered into a 10b5-1 trading plan (the “Plan”) for the purpose of repurchasing up to a specified number of shares of the Company’s outstanding common stock (the “Repurchase Limit”) in accordance with the $17.5 million share repurchase program ("Program") previously authorized by the Company’s Board of Directors, which was announced by the Company on March 11, 2025.
Removed
The stock repurchase plan allows the Company to purchase common stock from time to time through, among other ways, open market purchases, privately negotiated transactions, block purchases, and/or pursuant to Rule 10b5-1 trading plans, subject to applicable securities laws and other legal requirements and relevant factors.
Added
The Plan is intended to comply with Rule 10b5-1(c) under the Exchange Act, as amended. The Plan allows the Company to repurchase shares up to the Repurchase Limit commencing September 20, 2025 and ending on the earlier of the date on which the Repurchase Limit is reached or other events specified in the Plan.
Removed
The number of shares purchased and the timing of any purchases will depend upon a number of factors, including the price and availability of the Company’s stock and general market conditions.
Added
Repurchases of common stock under the Plan will be administered through an independent broker and are subject to certain price, market, volume and timing constraints specified in the Plan. 22 Table of Contents Unregistered Sales o f Equity Securities None.
Removed
Unregistered Sales o f Equity Securities As part of the $6.4 million acquisition of 3Point, the Company issued 89,445 shares of its common stock to the sellers on December 4, 2024. The shares were issued in a private placement pursuant to Section 4(a)(2) of the Securities Act of 1933, as amended, and/or Rule 506(b) thereunder.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

54 edited+24 added−13 removed25 unchanged
Biggest changeThese business impacts could negatively affect us in a number of ways, including, but not limited to, reduced demand for our core products and services, reductions to our revenue and profitability, costs associated with complying with new or amended laws and regulations affecting our business, declines in our stock price, reduced availability and less favorable terms of future borrowings, valuation of our pension obligations, reduced credit-worthiness of our customers, and potential impairment of the carrying value of indefinite-lived intangible assets. 23 Table of Contents The Year Ended December 31, 2024 Compared to the Year Ended December 31, 2023 Operations The following table provides highlights of our financial performance (in thousands, except percentages): For the Years Ended December 31, 2024 2023 $ Change % Change Net sales: Branded Products $ 353,314 $ 342,680 $ 10,634 3.1 % Healthcare Apparel 119,191 113,878 5,313 4.7 % Contact Centers 96,949 91,500 5,449 6.0 % Net intersegment eliminations (3,778 ) (4,756 ) 978 (20.6 %) Consolidated net sales 565,676 543,302 22,374 4.1 % Gross margin: Branded Products 124,723 114,627 10,096 8.8 % Healthcare Apparel 45,746 42,281 3,465 8.2 % Contact Centers 52,207 49,148 3,059 6.2 % Net intersegment eliminations (2,098 ) (2,509 ) 411 (16.4 %) Consolidated gross margin 220,578 203,547 17,031 8.4 % Selling and administrative expenses: Branded Products 94,384 88,225 6,159 7.0 % Healthcare Apparel 41,149 38,209 2,940 7.7 % Contact Centers 42,999 39,682 3,317 8.4 % Intersegment Eliminations (2,098 ) (2,509 ) 411 (16.4 %) Other 23,492 20,453 3,039 14.9 % Consolidated selling and administrative expenses 199,926 184,060 15,866 8.6 % Interest expense 6,358 9,718 (3,360 ) (34.6 %) Income before income tax expense 14,294 9,769 4,525 46.3 % Income tax expense 2,290 997 1,293 129.7 % Net income 12,004 8,772 3,232 36.8 % EBITDA(1) $ 34,097 $ 33,482 $ 615 1.8 % (1) Please refer to "Non-GAAP Financial Measure" below for a reconciliation of EBITDA to net income. 24 Table of Contents Net Income The Company generated net income of $12.0 million during the year ended December 31, 2024 and net income of $8.8 million during the year ended December 31, 2023.
Biggest changeThese business impacts could negatively affect us in a number of ways, including, but not limited to, reduced demand for our core products and services, declines in our revenue and profitability, increased costs related to higher oil and natural gas prices and/or supply imbalances in the oil and natural gas markets, costs associated with complying with new or amended laws and regulations and mitigating the increased cost of the new tariffs and duties affecting our business, declines in our stock price, reduced availability and less favorable terms of future borrowings, negative impacts on the valuation of our pension obligations, reduced credit-worthiness of our customers, and potential impairment of the carrying value of indefinite-lived intangible assets and goodwill. 25 Table of Contents The Year Ended December 31, 2025 Compared to the Year Ended December 31, 2024 Operations The following table provides highlights of our financial performance (in thousands, except percentages): For the Years Ended December 31, 2025 2024 $ Change % Change Net sales: Branded Products $ 361,134 $ 353,314 $ 7,820 2.2 % Healthcare Apparel 115,866 119,191 (3,325 ) (2.8 %) Contact Centers 92,520 96,949 (4,429 ) (4.6 %) Net intersegment eliminations (3,336 ) (3,778 ) 442 (11.7 %) Consolidated net sales 566,184 565,676 508 0.1 % Gross margin: Branded Products 123,712 124,723 (1,011 ) (0.8 %) Healthcare Apparel 41,962 45,746 (3,784 ) (8.3 %) Contact Centers 48,980 52,207 (3,227 ) (6.2 %) Net intersegment eliminations (1,790 ) (2,098 ) 308 (14.7 %) Consolidated gross margin 212,864 220,578 (7,714 ) (3.5 %) Selling and administrative expenses: Branded Products 96,067 94,384 1,683 1.8 % Healthcare Apparel 39,550 41,149 (1,599 ) (3.9 %) Contact Centers 42,385 42,999 (614 ) (1.4 %) Intersegment Eliminations (1,790 ) (2,098 ) 308 (14.7 %) Other 23,263 23,492 (229 ) (1.0 %) Consolidated selling and administrative expenses 199,475 199,926 (451 ) (0.2 %) Interest expense 5,143 6,358 (1,215 ) (19.1 %) Income before income tax expense 8,246 14,294 (6,048 ) (42.3 %) Income tax expense 1,246 2,290 (1,044 ) (45.6 %) Net income 7,000 12,004 (5,004 ) (41.7 %) EBITDA(1) $ 25,744 $ 34,097 $ (8,353 ) (24.5 %) (1) Please refer to "Non-GAAP Financial Measure" below for a reconciliation of EBITDA to net income. 26 Table of Contents Net Income The Company generated net income of $7.0 million during the year ended December 31, 2025 and net income of $12.0 million during the year ended December 31, 2024.
The Company at all times evaluates its capital expenditure program in light of prevailing economic conditions. The Company's material contractual obligations include outstanding debt, operating leases, long-term pension liability and non-qualified deferred compensation plan liabilities in Other Liabilities.
The Company at all times evaluates its capital expenditure program in light of prevailing economic conditions. The Company's material contractual obligations include outstanding debt, long-term pension liability, operating leases and non-qualified deferred compensation plan liabilities in Other Long-Term Liabilities.
For the year ended December 31, 2024, the Company had $7.7 million of net debt payments, consisting of $50.0 million in payments on the revolving credit facility and $4.7 million of payments in the term loan.
For the year ended December 31, 2024, the Company had $7.7 million in net debt payments, consisting of $50.0 million in payments on the revolving credit facility and $4.7 million in payments on the term loan.
These services are also provided internally to the Company’s other two operating segments. The Office Gurus has become an award-winning business process outsourcer offering inbound and outbound voice, email, text, chat and social media support. The nearshore call-center market has grown as businesses look to reduce operating costs while maintaining high-quality customer support.
These services are also provided internally to the Company’s other two operating segments. The Office Gurus has become an award-winning business process outsourcer offering inbound and outbound voice, email, text, chat and social media support. The nearshore call-center market specifically has grown as businesses look to reduce operating costs while maintaining high-quality customer support.
In the future, the Company may continue to use credit facilities and other secured and unsecured borrowings as a source of liquidity. 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.
In the future, the Company may continue to use its Credit Facilities and other secured and unsecured borrowings as a source of liquidity. 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.
The Company expects to permanently reinvest the earnings from its wholly-owned Brazilian and UK subsidiaries, and accordingly, has not provided deferred taxes on the subsidiaries’ undistributed net earnings or basis differences. The Company believes that the tax liability that would be incurred upon repatriation of the earnings from its Brazilian and UK subsidiaries is immaterial at December 31, 2024.
The Company expects to permanently reinvest the earnings from its wholly-owned Brazilian and UK subsidiaries, and accordingly, has not provided deferred taxes on the subsidiaries’ undistributed net earnings or basis differences. The Company believes that the tax liability that would be incurred upon repatriation of the earnings from its Brazilian and UK subsidiaries is immaterial at December 31, 2025.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with our Financial Statements, which present our results of operations for the years ended December 31, 2024 and 2023, as well as our financial positions at December 31, 2024 and 2023, contained elsewhere in this Form 10-K.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations The following discussion should be read in conjunction with our Financial Statements, which present our results of operations for the years ended December 31, 2025 and 2024, as well as our financial positions at December 31, 2025 and 2024, contained elsewhere in this Form 10-K.
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 ended December 31, 2024, there was no significant change in total unrecognized tax benefits.
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 ended December 31, 2025, there was no significant change in total unrecognized tax benefits.
Please refer to Note 5 to our Consolidated Financial Statements located in Item 8 of Part II of this Annual Report on Form 10-K for additional details on our outstanding long-term debt. Dividends and Share Repurchase Program During the years ended December 31, 2024 and 2023, the Company paid cash dividends of $9.3 million and $9.2 million, respectively.
Please refer to Note 5 to our Consolidated Financial Statements located in Item 8 of Part II of this Annual Report on Form 10-K for additional details on our outstanding long-term debt. Dividends and Share Repurchase Program During the years ended December 31, 2025 and 2024, the Company paid cash dividends of $8.9 million and $9.3 million, respectively.
Nearshore operators are able to provide comparable service to their U.S. counterparts at a fraction of the price. With an environment and career path designed to attract and maintain top talent across all sites, we believe The Office Gurus is positioned well to continue growing this business.
Nearshore operators can provide comparable service to their U.S. counterparts at a fraction of the price. With an environment and career path designed to attract and maintain top talent across all sites, we believe The Office Gurus is positioned well to continue growing this business.
The effective tax rate may vary from year to year due to discrete, unusual or non-recurring items, the resolution of income tax audits, changes in tax laws, the tax impact from employee share-based payments, or other items. 26 Table of Contents Liquidity and Capital Resources Liquidity Analysis Short-Term Liquidity For the next twelve months, our primary capital requirements are for capital to maintain our operations, meet contractual obligations, primarily consisting of our revolving credit facility, term loan, operating leases and acquisition-related contingent liabilities, and fund capital expenditures, dividends, stock repurchases, any potential merger and acquisition activity and other general corporate purposes.
The effective tax rate may vary from year to year due to discrete, unusual or non-recurring items, the resolution of income tax audits, changes in tax laws, the tax impact from employee share-based payments, or other items. 28 Table of Contents Liquidity and Capital Resources Liquidity Analysis Short-Term Liquidity For the next twelve months, our primary capital requirements are for capital to maintain our operations, meet contractual obligations, primarily consisting of our revolving credit facility and term loan (collectively, our "Credit Facilities") and operating leases, and fund capital expenditures, dividends, stock repurchases, any potential merger and acquisition activity and other general corporate purposes.
Income tax expense and the effective tax rate for the year ended December 31, 2024 and 2023 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.
Income tax expense and the effective tax rate for the year ended December 31, 2025 and 2024 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.
For the years ended December 31, 2024 and 2023, the Company had borrowings of $47.0 million and $6.0 million on the revolving credit facility, respectively. Both the debt payments and borrowings during 2024 and 2023 primarily related to the utilization of our revolving credit facility in the normal course of business.
For the years ended December 31, 2025 and 2024, the Company had borrowings of $95.0 million and $47.0 million on the revolving credit facility, respectively. Both the debt payments and borrowings during 2025 and 2024 primarily related to the utilization of our revolving credit facility in the normal course of business.
Critical accounting estimates are those estimates made in accordance with generally accepted accounting principles that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition or results of operations.
Critical accounting estimates are those estimates made in accordance with GAAP that involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition or results of operations.
We believe that the following critical accounting policies and estimates have a higher degree of inherent uncertainty and require our most significant judgments. Revenue Recognition Revenue is measured at the amount of consideration we expect to receive in exchange for the goods or services. Variable consideration for estimated returns, allowances and other price variances is recorded based upon historical experience.
We believe that the following critical accounting policies and estimates have a higher degree of inherent uncertainty and require our most significant judgments. Revenue Recognition Revenue is measured at the amount of consideration we expect to receive in exchange for the goods or services. Variable consideration is recorded based upon historical experience.
For a reconciliation of EBITDA to net income, its most directly comparable financial measure calculated and presented in accordance with GAAP, please read “Non-GAAP Financial Measure” below. Net Sales Net sales for the Company increased 4.1% or $22.4 million, for the year ended December 31, 2024 compared to the year ended December 31, 2023.
For a reconciliation of EBITDA to net income, its most directly comparable financial measure calculated and presented in accordance with GAAP, please read “Non-GAAP Financial Measure” below. Net Sales Net sales for the Company increased 0.1% or $0.5 million, for the year ended December 31, 2025 compared to the year ended December 31, 2024.
Prolonged or recurring disruptions or instability in the United States and global economies, and how the world reacts to those disruptions or instability, could have long-term impacts on our business.
Prolonged or recurring disruptions or instability in the United States and global political and economic environment, and how the world reacts to those disruptions or instability, could have long-term impacts on our business.
Excess cash of $9.0 million from foreign operations may generally be transferred to operations in the US. 28 Table of Contents Cash Flows from Operations Net cash provided by operating activities primarily results from cash collected from customers for our promotional products, branded uniforms, healthcare apparel and accessories, offset by cash payments made for raw materials, salaries and payroll related benefits, leases and other general corporate expenditures.
Excess cash of $8.4 million from foreign operations may generally be transferred to operations in the U.S. 29 Table of Contents Cash Flows from Operations Net cash provided by operating activities primarily results from cash collected from customers for our promotional products, branded uniforms, healthcare apparel and accessories, offset by cash payments made for raw materials, salaries and payroll related benefits, leases and other general corporate expenditures.
The cost of borrowing decreased in 2024, with the weighted average interest rate on outstanding borrowings under our Credit Facilities of 5.5% at December 31, 2024 compared to 6.7% at December 31, 2023. As of December 31, 2024, the Company had undrawn capacity of $103.0 million under the revolving credit facility.
The cost of borrowing decreased in 2025, with the weighted average interest rate on outstanding borrowings under our Credit Facilities of 5.1% at December 31, 2025 compared to 5.5% at December 31, 2024. As of December 31, 2025, the Company had undrawn capacity of $90.0 million under the revolving credit facility.
Cash Requirements Working Capital Needs The Company carries inventories of both raw materials and finished products, the practice of which requires substantial working capital, which we believe to be common in the industry.
Cash Requirements Working Capital Needs The Company carries inventories of both raw materials and finished products, the practice of which requires substantial working capital, which we believe to be common in the industry. The Company also requires working capital to invest in new product lines and technologies.
Income Taxes Income tax expense increased to $2.3 million for the year ended December 31, 2024 from $1.0 million for the year ended December 31, 2023. The effective tax rate was 16.0% and 10.2% for the year ended December 31, 2024 and 2023, respectively.
Income Taxes Income tax expense decreased to $1.2 million for the year ended December 31, 2025 from $2.3 million for the year ended December 31, 2024. The effective tax rate was 15.1% and 16.0% for the year ended December 31, 2025 and 2024, respectively.
Gross margin rate for our Contact Centers segment was 53.8% for the year ended December 31, 2024 and 53.7% for the year ended December 31, 2023.
Gross margin rate for our Contact Centers segment was 52.9% for the year ended December 31, 2025 and 53.8% for the year ended December 31, 2024.
Sources of Capital and Liquidity Cash on Hand As of December 31, 2024, we had $18.8 million of cash on our balance sheet, of which $15.7 million of cash was held at foreign subsidiaries.
Sources of Capital and Liquidity Cash on Hand As of December 31, 2025, we had $23.7 million of cash on our balance sheet, of which $16.2 million of cash was held at foreign subsidiaries.
The following table reconciles net income to EBITDA (in thousands): Years Ended December 31, 2024 2023 Net income $ 12,004 $ 8,772 Interest expense 6,358 9,718 Income tax expense 2,290 997 Depreciation and amortization 13,185 13,995 Intangible assets impairment charge 260 - EBITDA $ 34,097 $ 33,482 30 Table of Contents Critical Accounting Estimates Our discussion and analysis of financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with GAAP.
The following table reconciles net income to EBITDA (in thousands): Years Ended December 31, 2025 2024 Net income $ 7,000 $ 12,004 Interest expense 5,143 6,358 Income tax expense, net 1,246 2,290 Depreciation and amortization 12,355 13,185 Intangible assets impairment charge - 260 EBITDA $ 25,744 $ 34,097 31 Table of Contents Critical Accounting Estimates Our discussion and analysis of financial condition and results of operations are based upon our financial statements, which have been prepared in accordance with GAAP.
From a long-term perspective, we expect that demand for our signature marketing brands, including Fashion Seal Healthcare® and Wink®, will continue to provide opportunities for growth and increased market share. 22 Table of Contents Contact Centers In our Contact Centers segment (also known as “The Office Gurus”), which operates in El Salvador, Belize, Jamaica, Dominican Republic, and the United States, we provide outsourced, nearshore business process outsourcing, contact and call-center support services to North American customers.
From a long-term perspective, we expect that demand for our portfolio of brands Wink® and Fashion Seal Healthcare®, our trade name CID Resources and our license of Carhartt Medical, will continue to provide opportunities for growth and increased market share. 24 Table of Contents Contact Centers In our Contact Centers segment (also known as The Office Gurus), which operates in El Salvador, Belize, Dominican Republic, the United States and Jamaica until its closure on June 15, 2025, we provide outsourced, nearshore and onshore business process outsourcing, contact and call-center support services to North American customers.
The increase in net income during the year ended December 31, 2024 compared to the year ended December 31, 2023 was primarily due to increases in net sales and gross margins in all three of our reportable segments, and a decrease in interest expense, partially offset by an increase in selling and administrative expenses across all of our reportable segments.
The decrease in net income during the year ended December 31, 2025 compared to the year ended December 31, 2024 was primarily due to decreases in gross margins in all three of our reportable segments, partially offset by a decrease in interest expense.
We currently anticipate that we will spend more in capital expenditures in 2025 than we spent in 2024. Management currently believes that the combination of our current cash level, cash flows provided by operating activities and availability under the revolving credit facility will be sufficient to satisfy the above requirements for the next twelve months.
Management believes that the combination of our current cash level, cash flows provided by operating activities and availability under the revolving credit facilities will be sufficient to satisfy the above requirements for the next twelve months.
For the year ended December 31, 2023, the Company had $61.8 million in net debt payments, consisting of $64.0 million in payments on the revolving credit facility and $3.8 million in payments on the term loan.
For the year ended December 31, 2025, the Company had $7.4 million of net debt borrowings, consisting of $82.0 million in payments on the revolving credit facility and $5.6 million of payments in the term loan.
Additionally, we use a non-GAAP financial measure to evaluate our results of operations. For important information regarding the use of such non-GAAP financial measure, including reconciliations to the most comparable GAAP measure, see the section titled “Non-GAAP Financial Measure” below. Business Outlook Superior Group of Companies, Inc.
Additionally, we use a non-GAAP financial measure to evaluate our results of operations. For important information regarding the use of such non-GAAP financial measure, including reconciliations to the most comparable GAAP measure, see the section titled “Non-GAAP Financial Measure” below. Business Outlook Superior is comprised of three reportable business segments: (1) Branded Products, (2) Healthcare Apparel and (3) Contact Centers.
This decrease was due to a $30.7 million decrease in our weighted average outstanding borrowings along with a decrease in the weighted average interest rate on those borrowings from 6.7% for the year ended December 31, 2023 to 5.5% for the year ended December 31, 2024.
Interest Expense Interest expense decreased to $5.1 million for the year ended December 31, 2025 from $6.4 million for the year ended December 31, 2024. This decrease was due to a lower weighted average interest rate on those borrowings from 5.5% for the year ended December 31, 2024 to 5.1% for the year ended December 31, 2025.
The rate increase was primarily due to increased employee related costs and sales commissions, partially offset by a decrease in bad debts expense for customer accounts. As a percentage of net sales, selling and administrative expenses for our Healthcare Apparel segment was 34.5% for the year ended December 31, 2024 and 33.6% for the year ended December 31, 2023.
As a percentage of net sales, selling and administrative expenses for our Healthcare Apparel segment was 34.1% for the year ended December 31, 2025 and 34.5% for the year ended December 31, 2024. The rate decrease as compared to the prior year period was primarily driven by a decrease in depreciation expense and lower employee related costs.
As of December 31, 2024, we had an accrued liability of $0.9 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 in our balance sheet. 32 Table of Contents
As of December 31, 2025, we had an accrued liability of $0.9 million for unrecognized tax benefits. We recognize interest and penalties associated with the unrecognized tax benefit as part of the income tax provision and include accrued interest and penalties with the related reserve in other long-term liabilities in our consolidated balance sheets. 33 Table of Contents
The rate remained flat year over year as cost increases kept pace with revenue increases. 25 Table of Contents Selling and Administrative Expenses As a percentage of net sales, total selling and administrative expenses was 35.3% for the year ended December 31, 2024 and 33.9% for the year ended December 31, 2023.
As a percentage of net sales, selling and administrative expenses for our Branded Products segment was 26.6% for the year ended December 31, 2025 and 26.7% for the year ended December 31, 2024. The rate remained flat year over year as cost increases kept pace with increases in net sales.
As a percentage of net sales, selling and administrative expenses for our Contact Centers segment was 44.4% for the year ended December 31, 2024 and 43.4% for the year ended December 31, 2023.
As a percentage of net sales, selling and administrative expenses for our Contact Centers segment was 45.8% for the year ended December 31, 2025 and 44.4% for the year ended December 31, 2024. The rate increase as compared to the prior year period was primarily driven by an increase in credit loss expense.
The Company also requires working capital to invest in new product lines and technologies. 27 Table of Contents Capital expenditures Capital expenditures were $4.4 million and $5.0 million for the years ended December 31, 2024 and 2023, respectively. Debt Service Obligations In 2024 and 2023, we paid interest of $5.9 million and $9.6 million, respectively.
Capital expenditures Capital expenditures were $3.9 million and $4.4 million for the years ended December 31, 2025 and 2024, respectively. Debt Service Obligations In 2025 and 2024, we paid interest of $5.7 million and $5.9 million, respectively.
Shares repurchased may be reissued later in connection with employee benefit plans and other general corporate purposes. Shares purchased under the common stock repurchase plan are constructively retired and returned to unissued status. See Part II, Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
The Program may be modified, suspended or terminated at any time, without prior notice. Shares repurchased may be reissued later in connection with employee benefit plans and other general corporate purposes. Shares purchased under the Program are constructively retired and returned to unissued status. See Part II, Item 5.
Gross margin rate for our Branded Products segment was 35.3% for the year ended December 31, 2024 and 33.5% for the year ended December 31, 2023. The gross margin rate increased as compared to the prior year period primarily driven by sourcing mix resulting in lower product costs and pricing increases to existing customers.
Gross margin rate for our Branded Products segment was 34.3% for the year ended December 31, 2025 and 35.3% for the year ended December 31, 2024. The gross margin rate decreased as compared to the prior year period due to higher product costs.
As a strategic branding partner, we offer our customers customized branding solutions and strategies that generate favorable brand impressions, bolster customer retention and enhance employee engagement. Our products are sold to customers in a wide range of industries, including retail, hotel, food service, entertainment, technology, transportation and other industries.
Branded Products In our Branded Products segment, we produce and sell customized merchandising solutions, promotional products and branded uniform programs to our customers. As a strategic branding partner, we offer our customers customized branding solutions and strategies that generate favorable brand impressions, bolster customer retention and enhance employee engagement.
The ongoing conflict in the Middle East could continue to affect oil prices and have other negative effects on the global economy. Civil unrest in countries where we manufacture products, such as Haiti, may result in our facilities incurring damage or destruction that interrupts our manufacturing processes and adversely affects our reputation and our relationships with our customers.
Additionally, civil unrest in countries where we manufacture products, like Haiti, may result in our facilities incurring damage or destruction and could interrupt our manufacturing processes and adversely affect our reputation and our relationships with our customers.
Gross margin rate for the Company was 39.0% for the year ended December 31, 2024 up from 37.5% for the year ended December 31, 2023. The rate increase was primarily due to an improvement in gross margin rates in our Branded Products and Healthcare Apparel reportable segments.
Gross margin rate for the Company was 37.6% for the year ended December 31, 2025 down from 39.0% for the year ended December 31, 2024. The rate decrease was primarily due to decreases in gross margins in all three of our reportable segments.
In 2024, net cash provided by operating activities was $33.4 million. Cash collections from customers exceeded aggregate cash payments to vendors, lessors, employees and lenders primarily driven by the Company’s efforts to reduce outstanding receivable balances. In 2023, net cash provided by operating activities was $78.9 million.
In 2025, net cash provided by operating activities was $19.7 million. Cash collections from customers exceeded aggregate cash payments to vendors, lessors, employees and lenders. Collections are down from the prior year primarily related to timing of order delivery at year end. In 2024, net cash provided by operating activities was $33.4 million.
Sales volumes in this segment are impacted by a number of factors, including marketing programs of our customers and turnover of our customers’ employees, often times driven by the opening and closing of locations. From a long-term perspective, we believe that synergies within this segment will create opportunities to cross-sell products to new and existing customers.
Our products are sold to customers in a wide range of industries, including retail, hotel, food service, entertainment, technology, transportation and other industries. Sales volumes in this segment are impacted by a number of factors, including marketing programs of our customers and turnover of our customers’ employees, often times driven by the opening and closing of locations.
Healthcare Apparel In our Healthcare Apparel segment, we manufacture (through third parties or in our own facilities) and sell a wide range of healthcare apparel, such as scrubs, lab coats, protective apparel and patient gowns. We sell our brands of healthcare service apparel to healthcare laundries, dealers, distributors and retailers primarily in the United States.
From a long-term perspective, we believe that synergies within this segment will create opportunities to cross-sell products to new and existing customers. Healthcare Apparel In our Healthcare Apparel segment, we manufacture (through third parties or in our own facilities) and sell a wide range of healthcare apparel, such as scrubs, lab coats, protective apparel and patient gowns.
As part of our annual impairment assessments the Company determined the fair values were greater than the carrying values. 31 Table of Contents Income Taxes The Company is required to estimate and record income taxes payable for federal, state and foreign jurisdictions in which the Company operates.
The assumptions used to determine the fair value of our trade name indefinite lived intangible assets as of December 31, 2025 were consistent with the annual test as of August 31, 2025, discussed above. Income Taxes The Company is required to estimate and record income taxes payable for federal, state and foreign jurisdictions in which the Company operates.
The increase was attributable to net sales increases in all three of our reportable segments. Branded Products net sales increased 3.1%, or $10.6 million, for the year ended December 31, 2024 compared to the year ended December 31, 2023. The increase was primarily due to the expansion of business within existing accounts and new client wins.
The increase was primarily attributable to a net sales increase in our Branded Products reportable segment. Branded Products net sales increased 2.2%, or $7.8 million, for the year ended December 31, 2025 compared to the year ended December 31, 2024.
EBITDA for the year ended December 31, 2024 compared to the year ended December 31, 2023 increased primarily due to increased net sales and gross margins in all three of our reportable segments, partially offset by an increase in selling and administrative expenses across all of our reportable segments.
EBITDA EBITDA was $25.7 million and $34.1 million during the years ended December 31, 2025 and 2024, respectively. EBITDA for the year ended December 31, 2025 compared to the year ended December 31, 2024 decreased primarily due to lower gross margins in all three of our reportable segments.
Gross margin rate for our Healthcare Apparel segment was 38.4% for the year ended December 31, 2024 and 37.1% for the year ended December 31, 2023. The rate increase was primarily driven by lower supply chain costs.
Gross margin rate for our Healthcare Apparel segment was 36.2% for the year ended December 31, 2025 and 38.4% for the year ended December 31, 2024. The gross margin rate decreased as compared to 2024, primarily due to higher product costs in 2025 and unfavorable sales product mix.
Credit Facilities and Debt Activity The Company’s primary source of liquidity has been its net income and the use of credit facilities and term loans.
Cash collections from customers exceeded aggregate cash payments to vendors, lessors, employees and lenders primarily driven by the Company’s efforts to reduce outstanding receivable balances. Credit Facilities and Debt Activity The Company’s primary source of liquidity has been its net income and the use of its Credit Facilities.
Contact Centers net sales increased 6.0% before intersegment eliminations and 7.4% after intersegment eliminations for the year ended December 31, 2024 compared to the year ended December 31, 2023. The increase in net sales was attributable to sales growth from both new and existing customers. Gross Margin Gross margin is defined as net sales less cost of goods sold.
Contact Centers net sales decreased 4.6% or $4.4 million before intersegment eliminations and 4.3% or $4.0 million after intersegment eliminations for the year ended December 31, 2025 compared to the year ended December 31, 2024.
Selling and administrative expenses for our Other segment, which represents unallocated Corporate costs, increased by $3.0 million, primarily driven by an increase in employee related costs, third party professional services and the fair value recognition of a written put option which expired in the second quarter of 2024.
Overall selling and administrative expenses were down in line with the decrease in sales and the exit of Jamaica. Selling and administrative expenses for our "Other" segment, which represents unallocated corporate costs, decreased by $0.2 million, primarily driven by decreases in employee related costs.
As of December 31, 2024, 523,472 shares have been purchased under the new plan and $2.6 million remains available to repurchase shares under the $10 million authorized. 29 Table of Contents Non-GAAP Financial Measure EBITDA, which is a non-GAAP financial measure, is defined as net income excluding interest expense, income tax expense, depreciation and amortization expense and impairment charges.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities. 30 Table of Contents Non-GAAP Financial Measure EBITDA, which is a non-GAAP financial measure, is defined as net income excluding interest expense, income tax expense, depreciation and amortization expense and impairment charges.
In determining the fair value of our trade name indefinite lived intangible assets as of September 30, 2024, we used the following key assumptions: • A weighted-average royalty rate of 2.8%; • A long-term growth rate of 3.0%; and • An assumed discount rate of 16.5% The Company performed its annual impairment test for definite-lived intangible assets in the fourth quarter of 2024 and 2023.
In determining the fair value of our trade name indefinite lived intangible assets as of August 31, 2025, we used the following key assumptions: • Royalty rates of 0.75% - 3.0%; • A tax rate of 27.0%; • A long-term growth rate of 3.0%; and • Assumed discount rates of 14.5% - 16.5% 32 Table of Contents Goodwill: The discounted cash flow approach that we use for valuing goodwill as part of our impairment testing approach involves estimating future cash flows expected to be generated from the related assets, discounted to their present value using a risk-adjusted discount rate.
Healthcare Apparel net sales increased 4.7%, or $5.3 million, for the year ended December 31, 2024 compared to the year ended December 31, 2023. The increase was primarily due to higher digital sales from both our wholesale customers and our direct-to-consumer website, partially offset by lower volume from our store-based wholesale customers.
Healthcare Apparel net sales decreased 2.8%, or $3.3 million, for the year ended December 31, 2025 compared to the year ended December 31, 2024. The decrease in net sales was primarily due to volume decreases within existing customer accounts.
The Company anticipates that it will continue to pay dividends in the future as financial conditions permit. On August 9, 2024, the Company’s Board of Directors approved a new stock repurchase plan. Under the plan, the Company is authorized to repurchase up to $10 million of its common stock over a period of one year ending in August 2025.
The Company anticipates that it will continue to pay dividends in the future as financial conditions permit.
Removed
(together with its subsidiaries, the “Company,” “Superior,” “we,” “our,” or “us”) is comprised of three reportable business segments: (1) Branded Products, (2) Healthcare Apparel and (3) Contact Centers. Branded Products In our Branded Products segment, we produce and sell customized merchandising solutions, promotional products and branded uniform programs to our customers.
Added
We sell our brands of healthcare service apparel to healthcare laundries, dealers, distributors and retailers primarily in the United States.
Removed
Global Economic and Political Conditions Economic and political events over the past several years have altered the landscape in which we and other U.S. companies operate in a variety of ways. World events, including the Russian invasion of Ukraine and the resulting economic sanctions have impacted the global economy, including by exacerbating inflationary and other pressures.
Added
Global Economic and Political Conditions During 2025, the U.S. government imposed higher tariffs and/or new tariffs which impacted certain sources of the Company’s materials and production.
Removed
While inflation and interest rates decreased in 2024, the effects of the conflict in the Middle East, further fluctuations in inflationary conditions and interest rates, additional sanctions or retaliatory measures related to the Russia-Ukraine crisis or other situations, including deteriorating or prolonged diplomatic tension between the United States and China, could further negatively affect U.S. and international commerce and exacerbate or prolong the period of high energy prices.
Added
Additionally, the U.S.'s trade agreements and/or preferences with certain countries in Africa, through the African Growth and Opportunity Act (AGOA), and with Haiti, through the Haitian Hemispheric Opportunity through Partnership Encouragement Act (HOPE) and the Haiti Economic Lift Program of 2010 (HELP), expired on September 30, 2025. In February 2026, these agreements were retroactively extended until December 2026.
Removed
EBITDA EBITDA was $34.1 million and $33.5 million during the years ended December 31, 2024 and 2023, respectively.
Added
The process and timing for receiving a refund of duties paid in the interim period between expiration and when retroactivity was granted has yet to be determined.
Removed
The rate increase was primarily driven by increased commissions, employee related costs, increased expenditures related to marketing, advertising activities and the expiration of our written put option. As a percentage of net sales, selling and administrative expenses for our Branded Products segment was 26.7% for the year ended December 31, 2024 and 25.7% for the year ended December 31, 2023.
Added
If not renewed and/or extended after December 2026, the cost of continuing to do business in these countries likely will negatively impact our results of operations and financial position, or result in us moving sourcing and manufacturing from these countries to countries with more favorable cost structures.
Removed
The rate increase was primarily attributable to an increase in expenditures related to marketing and advertising activities along with employee related costs which were partially offset by expense leverage on increased net sales.
Added
We will continue to monitor the status of the trade agreements and preferences involving the U.S. government and the countries in which we source and/or manufacture products. See Item 8, “ NOTE 7 – Contingencies and Geographic Supply Concentrations ,” and "Item 1A — Risk Factors — Recently imposed tariffs may have a material adverse impact on our business.
Removed
The rate increase was primarily attributable to an increase in employee related expenses, including both headcount and select pay rate increases to support sales growth, as well as, an increase in bad debts expense.
Added
" On February 20, 2026, the United States Supreme Court ruled that the International Emergency Economic Powers Act (IEEPA) does not authorize the President to impose tariffs, effectively invalidating the tariffs imposed via that method. These IEEPA tariffs stopped being collected at 12:00 a.m. on February 24, 2026.
Removed
Interest Expense Interest expense decreased to $6.4 million for the year ended December 31, 2024 from $9.7 million for the year ended December 31, 2023.
Added
The Supreme Court’s ruling left open the questions of whether, how, and when payors of the tariffs might receive refunds. A determination of these, and other questions, could take a significant amount of time to resolve. Soon after the Supreme Court’s decision, President Trump announced his intention to impose tariffs using different legal bases.
Removed
Cash collections from customers exceeded aggregate cash payments to vendors, lessors, employees and lenders primarily driven by the Company’s collection of receivable balances coupled with positive non-cash add-backs for contract assets and decreases in cash outflows for inventory.
Added
Already, a new 10% tariff has been implemented under Section 122 of the Trade Act of 1974, effective as of February 24, 2026. The Supreme Court’s ruling and President Trump’s response add new uncertainty to global trade, including the Company’s exposure to tariffs.
Removed
This plan replaces the May 2, 2019 plan, as amended, which authorized the repurchase of up to 750,000 shares. 92,549 shares had been repurchased under the May 2, 2019 plan as of August 9, 2024. No further shares will be repurchased under that plan.
Added
It is uncertain how inflation and interest rates will be impacted in 2026 by the imposition of tariffs and other trade-related actions or inactions. World events, such as the Russia-Ukraine War, the joint U.S-Israeli strikes on Iran in February 2026 and other conflicts in the Middle East, continue to negatively affect the global economy.
Removed
The new stock repurchase plan allows the Company to purchase common stock from time to time through, among other ways, open market purchases, privately negotiated transactions, block purchases, and/or pursuant to Rule 10b5-1 trading plans, subject to applicable securities laws and other legal requirements and relevant factors.
Added
The increase was primarily due to an additional $11.0 million in net sales attributable to 3 Point branding company we acquired in December 2024. This increase was partially offset by a net volume decrease within existing large enterprise accounts.
Removed
The number of shares purchased and the timing of any purchases will depend upon a number of factors, including the price and availability of the Company’s stock and general market conditions. The stock repurchase plan may be modified, suspended or terminated at any time, without prior notice.
Added
The decrease in net sales versus the year-ago period reflects continued macroeconomic headwinds, which continue to contribute to client downsizing and customer attrition outpacing new customer acquisitions. Gross Margin Gross margin is defined as net sales less cost of goods sold.
Removed
Intangibles Indefinite-lived intangible assets such as trade names are not amortized but are subject to an annual impairment test in the fourth quarter based or on an interim basis if there are indicators of impairment present.
Added
The decrease in the gross margin rate was attributable to higher agent costs and unfavorable margin mix associated with the closure of our Jamaica contact center. 27 Table of Contents Selling and Administrative Expenses As a percentage of net sales, total selling and administrative expenses was 35.2% for the year ended December 31, 2025, mostly flat compared to 35.3% for the year ended December 31, 2024.

… 11 more changes not shown on this page.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

4 edited+0 added−0 removed6 unchanged
Biggest changeWe also have exposure to foreign currency exchange risk from the translation of foreign subsidiaries from the local currency into the U.S. dollar. Comprehensive income (loss) during the years ended December 31, 2024 and 2023, included a foreign currency translation adjustment loss of $3.4 million and a foreign currency translation adjustment gain of $0.7 million, respectively. 33 Table of Contents
Biggest changeWe also have exposure to foreign currency exchange risk from the translation of foreign subsidiaries from the local currency into the U.S. dollar. Comprehensive income (loss) during the years ended December 31, 2025 and 2024, included a foreign currency translation adjustment gain of $1.6 million and a foreign currency translation adjustment loss of $3.4 million, respectively. 34 Table of Contents
Excluding intercompany payables and receivables considered to be long-term investments, changes in exchange rates for assets and liabilities not denominated in their functional currency are reported as foreign currency transaction gains (losses) within selling and administrative expenses in our statements of comprehensive income. During the years ended December 31, 2024 and 2023 foreign currency transaction gains (losses) were not significant.
Excluding intercompany payables and receivables considered to be long-term investments, changes in exchange rates for assets and liabilities not denominated in their functional currency are reported as foreign currency transaction gains (losses) within selling and administrative expenses in our statements of comprehensive income. During the years ended December 31, 2025 and 2024 foreign currency transaction gains (losses) were not significant.
A hypothetical increase in the SOFR of 100 basis points as of January 1, 2024 would have resulted in approximately $0.9 million in additional pre-tax interest expense for the year ended December 31, 2024. For further information regarding our debt instruments, see Note 5 to the Financial Statements.
A hypothetical increase in the SOFR of 100 basis points as of January 1, 2025 would have resulted in approximately $0.9 million in additional pre-tax interest expense for the year ended December 31, 2025. For further information regarding our debt instruments, see Note 5 to the Financial Statements.
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, 2024, we had no foreign currency exchange hedging contracts.
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, 2025, we had no foreign currency exchange hedging contracts.

Other SGC 10-K year-over-year comparisons