393 added · 232 removed between the two most recent 10-Ks. The risks a company starts — or stops — disclosing are often the story.
Newly disclosed
These 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 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.
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.
In determining the fair value of our reporting unit, we used the following assumptions: • Expected cash flows underlying our business plans for the initial five-year period were based on a detailed, multi-year forecast performed by our BAMKO reporting unit; • Long-term growth rate of 3.0%; and • Discount rate of 14.0% No impairments were identified during the third quarter 2025 annual goodwill and indefinite-lived intangible impairment tests.
This estimation process required a high degree of auditor judgement and an increased extent of effort. 36 Table of Contents Our audit procedures related to the CID Resources trade name included the following, among others. • We obtained an understanding, evaluated the design and tested the operating effectiveness of key controls relating to management’s quantitative impairment assessment process including review of assumptions used in the model and the completeness and accuracy of forecasted information. • We reviewed revenue forecasts prepared by management that were utilized in the model and performed sensitivity analyses on those forecasts. • We utilized a valuation specialist to assess the appropriateness of the model utilized and underlying assumptions including the royalty rate and discount rate. /s/ GRANT THORNTON LLP We have served as the Company's auditor since 2022.
AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In thousands, except share and par value data) December 31, 2025 2024 ASSETS Current assets: Cash and cash equivalents $ 23,691 $ 18,766 Accounts receivable 104,336 95,092 Inventories 97,474 96,675 Contract assets 48,903 51,688 Prepaid expenses and other current assets 13,259 10,831 Total current assets 287,663 273,052 Property, plant and equipment, net 37,352 41,879 Operating lease right-of-use assets 12,620 15,567 Deferred tax asset 15,003 13,835 Intangible assets, net 47,254 51,137 Goodwill 2,583 2,304 Other assets 19,369 17,360 Total assets $ 421,844 $ 415,134 LIABILITIES AND SHAREHOLDERS’ EQUITY Current liabilities: Accounts payable $ 48,343 $ 50,942 Other current liabilities 53,041 44,367 Current portion of long-term debt 6,563 5,625 Current portion of acquisition-related contingent liabilities - 814 Total current liabilities 107,947 101,748 Long-term debt 87,093 80,410 Long-term pension liability 15,010 13,315 Long-term acquisition-related contingent liabilities 826 935 Long-term operating lease liabilities 7,939 10,486 Other long-term liabilities 10,211 9,384 Total liabilities 229,026 216,278 Commitments and contingencies (Note 7) Shareholders’ equity: Preferred stock, $ .001 par value - authorized 300,000 shares ( none issued) - - Common stock, $ .001 par value - authorized 50,000,000 shares, issued and outstanding - 15,730,615 and 16,484,921 shares, respectively 16 16 Additional paid-in capital 84,628 84,060 Retained earnings 112,871 120,139 Accumulated other comprehensive loss, net of tax ( 4,697 ) ( 5,359 ) Total shareholders’ equity 192,818 198,856 Total liabilities and shareholders’ equity $ 421,844 $ 415,134 See accompanying Notes to the Consolidated Financial Statements. 40 Table of Contents SUPERIOR GROUP OF COMPANIES, INC.
AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In thousands) Years Ended December 31, 2025 2024 CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 7,000 $ 12,004 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 12,355 13,185 Inventory write-downs 2,252 2,423 Credit loss expense 2,291 232 Share-based compensation expense 5,263 4,270 Deferred income tax benefit ( 846 ) ( 1,581 ) Change in fair value of acquisition-related contingent liabilities 95 437 Non-cash operating lease expense 2,948 2,337 Change in fair value of written put options - 653 Other, net 299 507 Changes in assets and liabilities, net of acquisition of businesses: Accounts receivable ( 10,757 ) 7,977 Contract assets 3,045 ( 3,434 ) Inventories ( 2,804 ) ( 1,031 ) Prepaid expenses and other current assets ( 2,167 ) ( 2,375 ) Other assets ( 2,076 ) ( 2,953 ) Accounts payable and other current liabilities 1,723 ( 403 ) Payment of acquisition-related contingent liabilities ( 791 ) ( 686 ) Long-term pension liability 407 433 Other long-term liabilities 1,472 1,433 Net cash provided by operating activities 19,709 33,428 CASH FLOWS FROM INVESTING ACTIVITIES Additions to property, plant and equipment ( 3,947 ) ( 4,435 ) Acquisition of business - ( 4,000 ) Net cash used in investing activities ( 3,947 ) ( 8,435 ) CASH FLOWS FROM FINANCING ACTIVITIES Borrowings under revolving lines of credit 95,000 47,000 Payments under revolving lines of credit ( 82,000 ) ( 50,000 ) Payment of term loan ( 5,625 ) ( 4,687 ) Payment of cash dividends ( 8,905 ) ( 9,284 ) Payment of acquisition-related contingent liabilities ( 226 ) ( 897 ) Proceeds received on exercise of stock options 240 1,128 Shares withheld for taxes ( 162 ) ( 317 ) Common shares repurchased and retired ( 10,136 ) ( 7,417 ) Net cash used in financing activities ( 11,814 ) ( 24,474 ) Effect of currency exchange rates on cash 977 ( 1,649 ) Net increase (decrease) in cash and cash equivalents 4,925 ( 1,130 ) Cash and cash equivalents balance, beginning of year 18,766 19,896 Cash and cash equivalents balance, end of year $ 23,691 $ 18,766 Supplemental disclosure of cash flow information: Income taxes paid (refunded), net $ 1,623 $ 2,303 Interest paid $ 5,663 $ 5,917 See accompanying Notes to the Consolidated Financial Statements. 42 Table of Contents Superior Group of Companies , Inc. and Subsidiaries Notes to the Consolidated Financial Statements NOTE 1 – Description of Business, Basis of Presentation and Summary of Accounting Policies: Description of business Superior Group of Companies, Inc.
The following tables set forth financial information related to the Company’s operating segments (in thousands): Branded Products Healthcare Apparel Contact Centers Intersegment Eliminations Other Total For the Year Ended December 31, 2025: Net sales $ 361,134 $ 115,866 $ 92,520 $ ( 3,336 ) $ - $ 566,184 Cost of goods sold 237,422 73,904 43,540 ( 1,546 ) - 353,320 Gross margin 123,712 41,962 48,980 ( 1,790 ) - 212,864 Selling and administrative expenses 96,067 39,550 42,385 ( 1,790 ) 23,263 199,475 Depreciation and amortization 5,637 3,718 2,650 - 350 12,355 Segment EBITDA $ 33,282 $ 6,130 $ 9,245 $ - $ ( 22,913 ) $ 25,744 Branded Products Healthcare Apparel Contact Centers Intersegment Eliminations Other Total For the Year Ended December 31, 2024: Net sales $ 353,314 $ 119,191 $ 96,949 $ ( 3,778 ) $ - $ 565,676 Cost of goods sold 228,591 73,445 44,742 ( 1,680 ) - 345,098 Gross margin 124,723 45,746 52,207 ( 2,098 ) - 220,578 Selling and administrative expenses 94,384 41,149 42,999 ( 2,098 ) 23,492 199,926 Depreciation and amortization 5,948 3,892 2,968 - 377 13,185 Intangible assets impairment charge - 260 - - - 260 Segment EBITDA $ 36,287 $ 8,749 $ 12,176 $ - $ ( 23,115 ) $ 34,097 The following table reconciles total Segment EBITDA to income before income tax expense: Years Ended December 31, 2025 2024 Income before income tax expense $ 8,246 $ 14,294 Interest expense 5,143 6,358 Depreciation and amortization 12,355 13,185 Intangible assets impairment charge - 260 Segment EBITDA $ 25,744 $ 34,097 52 Table of Contents NOTE 3 – Net Sales: The Company generates revenue by producing and manufacturin
During the third quarter of 2024, the Company performed an interim impairment test on certain of its indefinite-lived trade name intangible assets within the Healthcare segment which resulted in an immaterial impairment of $0.3 million.
During the third quarter of 2025, the Company voluntarily changed its date of the annual goodwill impairment assessment for all of its reporting units as well as its indefinite-lived intangible assets to August 31.
Indefinite-lived Intangible Assets: As of August 31, 2025, the Company performed its annual impairment test for its indefinite-lived trade name intangible assets which did not result in an impairment.
This guidance is effective for annual periods beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027.
No longer disclosed
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.
For example, all 50 states and several U.S. territories now have data breach laws that require timely notification to affected individuals, and at times regulators, credit reporting agencies and other bodies, if a company has experienced the unauthorized access or acquisition of certain personal information.
In addition, although we conduct due diligence investigations prior to each acquisition, there can be no assurance that we will discover or adequately protect against all material liabilities of an acquired business for which we may be responsible as a successor owner or operator.
The measures we have in place to monitor and protect our information technology systems might not provide sufficient protection from catastrophic events, power surges, viruses, malicious software (including ransomware), attempts to gain unauthorized access to data or other types of cyber-based attacks.
We will continue to monitor and assess the impact of these laws, and any new ones enacted, which may impose substantial penalties for violations, impose significant costs for investigations and compliance, allow private class-action litigation and carry significant potential liability for our business.
Failure to comply with U.S. and non-U.S. data protection laws and regulations could result in government enforcement actions (which could include substantial civil and/or criminal penalties), private litigation and/or adverse publicity and could negatively affect our operating results and business.
If an event of default occurs, our lenders could increase our borrowing costs, restrict our ability to obtain additional borrowings under our line of credit, accelerate all amounts outstanding or enforce its interest against collateral pledged under the credit agreement.
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.
Although we have paid cash dividends in the past, there can be no assurance that we will continue to pay any dividend in the future. 17 Table of Contents General Risk Factors We are subject to periodic litigation in both domestic and international jurisdictions that may adversely affect our financial position and results of operations.
From time-to-time we may be involved in legal or regulatory actions regarding product liability, employment practices, intellectual property infringement, bankruptcies, telemarketing compliance, consumer protections and other litigation or enforcement matters.
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.
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).