SUPERIOR GROUP OF COMPANIES, INC.
For the period ended Sep 30, 2026. Filed Nov 9, 2026.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2026 · Filed Nov 9, 2026
SGC$12.62-6.1%Stored close · as of Nov 9, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-06-30; filed 2026-08-04.
0001437749-26-025511
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-11-09.
0001437749-26-035716
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 116 previous paragraphs and 128 current paragraphs.
64 unchanged; 43 reworded; 17 added; 7 removed; 2 previous and 4 current paragraphs rearranged.
Tables are not compared: 3 previous and 3 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (17)
Current report
Gross margin rate for the Company was 38.2% for the three months ended September 30, 2026 and 38.3% for the three months ended September 30, 2025.
Current report
Gross margin rate for our Healthcare Apparel segment was 32.7% for the three months ended September 30, 2026 and 38.5% for the three months ended September 30, 2025. The rate decrease was primarily driven by $4.0 million of incremental inventory write-downs, partially offset by the benefit of $1.8 million of tariff refunds.
Current report
Gross margin rate for our Contact Centers segment was 52.9% for the three months ended September 30, 2026 and 2025.
Current report
Healthcare Apparel net sales decreased 0.7% or $0.7 million, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. The decrease was primarily due to volume decreases with existing customers, due in part to the change in a customer's financial position.
Current report
Gross margin rate for the Company was 37.8% for the nine months ended September 30, 2026 and 37.9% for the nine months ended September 30, 2025.
Current report
Gross margin rate for our Healthcare Apparel segment was 33.7% for the nine months ended September 30, 2026 and 37.1% for the nine months ended September 30, 2025. The rate decrease was primarily driven by $7.1 million of incremental inventory write-downs, partially offset by the benefit of $4.0 million of net tariff refunds.
Current report
Capital expenditures were $2.7 million and $3.4 million for the nine months ended September 30, 2026 and 2025, respectively.
Current report
The preparation of our financial statements in conformity with GAAP requires the Company to make estimates, judgments and assumptions that affect the reported amounts of assets, liabilities and disclosures as of the date of the consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. There have been no material changes to the critical accounting estimates disclosed in Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” of our Annual Report on Form 10-K for the year ended December 31, 2025.
Current report
Annual Impairment Tests:
Current report
Indefinite-lived Intangible Assets:
Current report
• Royalty rates of 0.5% - 2.5%;
Current report
• A tax rate of 27.0%;
Current report
• Assumed discount rates of 15.0% - 17.0%.
Current report
Goodwill:
Current report
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. Terminal values are also estimated and discounted to their present value. Assessing the recoverability of goodwill requires us to make estimates and assumptions about sales, operating margins, growth rates and discount rates based on our forecasts, business plans, economic projections, anticipated future cash flows and marketplace data. We performed our annual impairment test as of August 31, 2026, which did not result in any goodwill impairment. In determining the fair value of our reporting unit, we used the following assumptions:
Current report
• 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;
Current report
• Discount rate of 14.5%.
Removed paragraphs (7)
Previous report
Gross margin rate for the Company was 38.0% for the three months ended June 30, 2026 and 38.4% for the three months ended June 30, 2025. The rate decrease was primarily due to lower gross margin rates in our Healthcare Apparel and Contact Centers segments.
Previous report
Gross margin rate for our Healthcare Apparel segment was 32.9% for the three months ended June 30, 2026 and 35.5% for the three months ended June 30, 2025. The rate decrease was primarily driven by the impact of a $2.6 million additional write-down of inventory, partially offset by $1.8 million of net tariff refunds.
Previous report
Healthcare Apparel net sales increased 0.6% or $0.3 million, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The increase was primarily due to volume increases within existing customer accounts partially offset by tariff refunds.
Previous report
Gross margin rate for the Company was 37.6% for the six months ended June 30, 2026 and 2025.
Previous report
Gross margin rate for our Healthcare Apparel segment was 34.3% for the six months ended June 30, 2026 and 36.3% for the six months ended June 30, 2025. The rate decrease was primarily driven by the impact of a $2.6 million additional write-down of inventory, partially offset by $1.8 million net tariff refunds.
Previous report
Intangible Assets Impairment Charge
Previous report
Capital expenditures were $1.9 million and $2.7 million for the six months ended June 30, 2026 and 2025, respectively.
Reworded paragraphs (43)
Previous wording
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited financial statements and the notes thereto included in the Consolidated Financial Statements in Part I, Item 1 (“Financial Statements”) of this report and in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2025.
Current wording
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our unaudited financial statements and the notes thereto included in the Consolidated Financial Statements in Part I, Item 1 (“Financial Statements”) of this report and in conjunction with our Annual Report on Form 10-K for the year endedDecember 31, 2025*.*
Previous wording
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 expect that demand for our portfolio of brands Wink®, Fashion Seal Healthcare®, its trade name CID Resources and our license of Carhartt Medical, will continue to provide opportunities for growth and increased market share.
Current wording
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 apparel. 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 expect that demand for our portfolio of brands Wink®, Fashion Seal Healthcare®, its trade name CID Resources and our license of Carhartt Medical will continue to provide opportunities for growth and increased market share.
Previous wording
In our Contact Centers segment (also known as “The Office Gurus”), which operates in El Salvador, Belize, Dominican Republic and the United States, and in Jamaica until its closure on June 15, 2025, we provide outsourced, nearshore business process outsourcing, contact and call-center support services to North American customers. 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. 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.
Current wording
In our Contact Centers segment (also known as “The Office Gurus”), which operates in El Salvador, Belize, Dominican Republic, the United States and in Jamaica until its closure on June 15, 2025, we provide outsourced, offshore and nearshore business process outsourcing, contact and call-center support services to North American customers. 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. 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. See Note 11 for further discussion of the Company’s acquisition on October 28, 2026, expanding its services to provide offshore operations in the Philippines.
Previous wording
During 2025, the U.S. government imposed higher tariffs and/or new tariffs which impacted certain sources of the Company’s materials and production. 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 and during the six months ended June 30, 2026, the Company recorded a consolidated duties receivable of $2.3 million within other current assets through a reduction of inventory and reversal of cost of goods sold of $0.4 million, primarily in its Healthcare Apparel segment of which the majority has been collected. If not renewed and/or extended beyond 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. 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 1, “NOTE 6 –* Contingencies and Geographic Supply Concentrations.*”
Current wording
During 2025, the U.S. government imposed higher tariffs and/or new tariffs which impacted certain sources of the Company’s materials and production. 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. During the first quarter of 2026, these agreements were retroactively extended until December 2026 and the Company recorded a consolidated duties receivable within other current assets for $2.3 million through a reduction of inventory and reversal of cost of goods sold of $0.4 million. The duties receivable was primarily related to the Healthcare Apparel segment, and as of September 30, 2026 was substantially collected. In September 2026, these agreements were retroactively extended until December 2028. 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 1, “NOTE 6 –* Contingencies and Geographic Supply Concentrations.*”
Previous wording
In February 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 on February 24, 2026. The Supreme Court’s ruling left open the questions of whether, how, and when payors of the tariffs might receive refunds; subsequently, the U.S. government created a system through which refunds of certain entries could be processed. The Company's accounting policy is to recognize tariff refunds (as a reduction of cost of goods sold) when the refund is probable and recognize corresponding refunds to customers (as a reduction of net sales) where contractually required or an implicit obligation exists. As of June 30, 2026, the Company has recorded a $4.3 million tariff refund, of which $3.1 million has been received in cash and corresponding refunds to customers of $2.7 million. The U.S. government implemented a new 10.0% tariff under Section 122 of the Trade Act of 1974, effective as of February 24, 2026. This tariff terminated on July 24, 2026. The U.S. government implemented new tariffs generally ranging from 10.0% to 12.5% under Section 301 of the Trade Act of 1974, effective as of July 24, 2026.
Current wording
In February 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 on February 24, 2026 and the U.S. government implemented a new 10.0% tariff under Section 122 of the Trade Act of 1974, effective as of February 24, 2026, which terminated on July 24, 2026. The Supreme Court’s ruling on IEEPA left open the questions of whether, how, and when payors of the tariffs might receive refunds; subsequently, the U.S. government created a system through which refunds of certain entries could be processed. The Company's accounting policy is to recognize tariff refunds (as a reduction of cost of goods sold) when the refund is probable and recognize corresponding refunds to customers (as a reduction of net sales) where contractually required or an implicit obligation exists. For the three and nine months ended September 30, 2026, the Company recorded a $3.7 million and $8.1 million, respectively, tariff refund, of which $1.9 million and $5.0 million, respectively, has been received in cash. The corresponding refunds to customers for the three and nine months ended September 30, 2026 were $2.0 million and $4.8 million, respectively. Effective July 24, 2026, the U.S. government implemented new tariffs generally ranging from 10.0% to 12.5% under Section 301 of the Trade Act of 1974.
Previous wording
It is uncertain how inflation and interest rates will be impacted during the remainder of this year and in future years 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 War with Iran in 2026 and other conflicts in the Middle East, continue to negatively affect the global economy. 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.
Current wording
It is uncertain how inflation and interest rates will be impacted during the remainder of this year and in future years 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 War with Iran in 2026 and other conflicts in the Middle East, continue to negatively affect the global economy and exert significant upward pressure on the price of oil and natural gas. 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.
Previous wording
The Company generated net income of $1.2 million and $1.6 million during the three months ended June 30, 2026 and 2025, respectively. The decrease in net income for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 was due to a significant decline in our Healthcare Apparel segment results, primarily driven by a trade name impairment charge and write-down of inventory, partially offset by net tariff refunds. This decline was partially offset by growth in our Branded Products and Contact Centers segments.
Current wording
The Company generated net income of $2.6 million and $2.7 million during the three months ended September 30, 2026 and 2025, respectively. The decrease in net income for the three months ended September 30, 2026 compared to the three months ended September 30, 2025 was due to losses in our Healthcare Apparel segment largely driven by inventory write-downs partially offset by tariff refunds.
Previous wording
Adjusted EBITDA was $7.7 million and $6.1 million during the three months ended June 30, 2026 and 2025, respectively. The Adjusted EBITDA increase was primarily due to growth in our Branded Products and Contact Centers segments, partially offset by a decline in our Healthcare Apparel segment. For a reconciliation of Adjusted EBITDA to net income, its most directly comparable financial measure calculated and presented in accordance with generally accepted accounting principles in the United States of America (“GAAP”), please read “Non-GAAP Financial Measure” below.
Current wording
Adjusted EBITDA was $6.7 million and $7.5 million during the three months ended September 30, 2026 and 2025, respectively. The Adjusted EBITDA decrease was primarily due to losses in our Healthcare Apparel segment, partially offset by increases in earnings before income taxes in our Branded Products and Contact Centers segments. For a reconciliation of Adjusted EBITDA to net income, its most directly comparable financial measure calculated and presented in accordance with generally accepted accounting principles in the United States of America (“GAAP”), please read “Non-GAAP Financial Measure” below.
Previous wording
Net sales for the Company increased 2.6%, or $3.8 million, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The increase was attributable to increases in net sales in our Branded Products segment, partially offset by declines in our Healthcare Apparel and Contact Centers segments.
Current wording
Net sales for the Company increased 5.4%, or $7.5 million, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025. The increase was attributable to increases in net sales in our Branded Products and Contact Centers segments.
Previous wording
Branded Products net sales increased 6.2%, or $5.7 million, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The increase was primarily due to volume increases of $7.5 million within existing customer accounts, partially offset by tariff refunds.
Current wording
Branded Products net sales increased 8.2%, or $7.0 million, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025. The increase was primarily due to volume increases within existing customer accounts, partially offset by tariff refunds to customers.
Previous wording
Healthcare Apparel net sales decreased 3.6%, or $1.0 million, for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 primarily due to tariff refunds.
Current wording
Healthcare Apparel net sales decreased 3.1%, or $1.0 million, for the three months ended September 30, 2026 compared to the three months ended September 30, 2025. The decrease was primarily due to volume decreases with existing customers, due in part to the change in a customer's financial position.
Previous wording
Contact Centers net sales decreased 3.7% or $0.9 million, before intersegment eliminations for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. The 3.7% decrease versus the prior period reflects client attrition that exceeded growth from new customer acquisitions.
Current wording
Contact Centers net sales increased 6.9%, or $1.6 million, before intersegment eliminations for the three months ended September 30, 2026 compared to the three months ended September 30, 2025. The 6.9% increase versus the prior period reflects growth from existing customers and new customer acquisitions that exceeded client attrition.
Previous wording
Gross margin rate for our Branded Products segment was 36.5% for the three months ended June 30, 2026 and 35.6% for the three months ended June 30, 2025. The rate increase was primarily driven by a favorable shift in the mix of pricing and customers.
Current wording
Gross margin rate for our Branded Products segment was 36.4% for the three months ended September 30, 2026 and 34.8% for the three months ended September 30, 2025. The rate increase was primarily driven by a favorable shift in the mix of pricing and customers.
Previous wording
Selling and administrative expenses decreased $0.9 million for the three months ended June 30, 2026, compared to the three months ended June 30, 2025. As a percentage of net sales, total selling and administrative expenses was 34.7% for the three months ended June 30, 2026 and 36.3% for the three months ended June 30, 2025. The rate decrease was driven by expense leverage in our Branded Products segment and lower expenses in our Contact Centers segments.
Current wording
Selling and administrative expenses increased $3.4 million for the three months ended September 30, 2026, compared to the three months ended September 30, 2025. As a percentage of net sales, total selling and administrative expenses was 35.5% for the three months ended September 30, 2026 and 35.0% for the three months ended September 30, 2025. The rate increase was driven by an increase in selling and administrative expenses in all three of our segments.
Previous wording
Branded Products selling and administrative expenses increased $0.6 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. As a percentage of net sales, selling and administrative expenses was 26.4% for the three months ended June 30, 2026, down slightly from 27.5% for the three months ended June 30, 2025 driven by expense leverage from the second quarter sales increase.
Current wording
Branded Products selling and administrative expenses increased $1.5 million for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily due to increased commission expense from increased gross margin. As a percentage of net sales, selling and administrative expenses was 27.1% for the three months ended September 30, 2026, down slightly from 27.6% for the three months ended September 30, 2025 driven by expense leverage from the third quarter year-over-year sales increase.
Previous wording
Healthcare Apparel selling and administrative expenses decreased $0.1 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025. Selling and administrative expenses as a percentage of net sales increased to 36.5% for the three months ended June 30, 2026 from 35.7% for the three months ended June 30, 2025.
Current wording
Healthcare Apparel selling and administrative expenses increased $1.5 million for the three months ended September 30, 2026 compared to the three months ended September 30, 2025, primarily due to credit loss charges resulting from the change in a customer's financial position. As a result, selling and administrative expenses as a percentage of net sales increased to 37.0% for the three months ended September 30, 2026 from 31.0% for the three months ended September 30, 2025.
Previous wording
Contact Centers selling and administrative expenses decreased $1.3 million for the three months ended June 30, 2026 compared to the three months ended June 30, 2025 due to a reduction in credit loss expense as compared to the prior year period. As a result, selling and administrative expenses as a percentage of net sales decreased to 44.8% for the three months ended June 30, 2026 from 48.4% for the three months ended June 30, 2025.
Current wording
Contact Centers selling and administrative expenses increased $0.2 million for the three months ended September 30, 2026 compared to the three months ended September 30, 2025 primarily due to higher employee related costs. As a result, selling and administrative expenses as a percentage of net sales decreased to 43.3% for the three months ended September 30, 2026 from 45.4% for the three months ended September 30, 2025 driven by expense leverage from the third quarter year-over-year sales increase.
Previous wording
Interest expense, net decreased to $1.0 million for the three months ended June 30, 2026 from $1.3 million for the three months ended June 30, 2025. This decrease was due to a lower weighted average interest rate on borrowings, from 5.6% for the three months ended June 30, 2025 to 4.8% for the three months ended June 30, 2026.
Current wording
Interest expense, net decreased to $0.8 million for the three months ended September 30, 2026 from $1.4 million for the three months ended September 30, 2025. This decrease was due to a lower outstanding debt balance in 2026 and a lower weighted average interest rate on borrowings, from 5.4% for the three months ended September 30, 2025 to 4.8% for the three months ended September 30, 2026.
Previous wording
Income tax expense increased to $0.2 million for the six months ended June 30, 2026 from $0.1 million for the six months ended June 30, 2025. The effective tax rate was 9.3% and 14.7% for the six months ended June 30, 2026 and 2025, respectively. Income tax expense and the effective tax rate for the six months ended June 30, 2026 was primarily impacted by the discrete tax benefit relating to the $2.6 million trade name impairment charge recorded during the current quarter, as well as items related to the Company’s share-based compensation and long-term incentive plans. The rate for both periods was further impacted by the variability in the mix of earnings across the Company’s foreign and domestic operations, which are subject to various statutory tax rates in those jurisdictions. The effective tax rate may vary from quarter to quarter 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.
Current wording
Income tax expense of $0.6 million was recognized for the three months ended September 30, 2026 compared to income tax expense of $0.4 million for the three months ended September 30, 2025. The effective tax rate was 18.4% and 13.9% for the three months ended September 30, 2026 and 2025, respectively. Income tax expense and the effective tax rate for the three months ended September 30, 2026 and September 30, 2025 were primarily impacted by the variability in the mix of earnings across the Company’s foreign and domestic operations, which are subject to various statutory tax rates in those jurisdictions. The effective tax rate may vary from quarter to quarter 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.
Previous wording
Six Months Ended June 30, 2026 Compared to Six Months Ended June 30, 2025 (in thousands)
Current wording
Nine Months Ended September 30, 2026 Compared to Nine Months Ended September 30, 2025 (in thousands)
Previous wording
The Company generated net income of $2.1 million and $0.8 million during the six months ended June 30, 2026 and 2025, respectively. The increase in net income for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 was primarily due to growth in our Branded Products and Contact Centers segments along with a decrease in consolidated interest expense, net partially offset by a loss in our Healthcare Apparel segment.
Current wording
The Company generated net income of $4.6 million and $3.5 million during the nine months ended September 30, 2026 and 2025, respectively. The increase in net income for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 was primarily due to growth in our Branded Products segment, cost savings by our Contact Centers segment and a decrease in consolidated interest expense, net, partially offset by a loss in our Healthcare Apparel segment.
Previous wording
Adjusted EBITDA was $12.5 million and $9.6 million during the six months ended June 30, 2026 and 2025, respectively. The Adjusted EBITDA increase was primarily due to growth in our Branded Products and Contact Centers segments partially offset by a loss in our Healthcare Apparel segment. For a reconciliation of Adjusted EBITDA to net income, its most directly comparable financial measure calculated and presented in accordance with generally accepted accounting principles in the United States of America (“GAAP”), please read “Non-GAAP Financial Measure” below.
Current wording
Adjusted EBITDA was $19.2 million and $17.1 million during the nine months ended September 30, 2026 and 2025, respectively. The Adjusted EBITDA increase was primarily due to earnings growth in our Branded Products segment and cost savings by our Contact Centers segment partially offset by an earnings loss in our Healthcare Apparel segment. For a reconciliation of Adjusted EBITDA to net income, its most directly comparable financial measure calculated and presented in accordance with generally accepted accounting principles in the United States of America (“GAAP”), please read “Non-GAAP Financial Measure” below.
Previous wording
Net sales for the Company increased 2.7% or $7.6 million, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The increase was attributable to increases in net sales in our Branded Products and Healthcare Apparel reportable segments, partially offset by a decline in our Contact Centers segment.
Current wording
Net sales for the Company increased 3.6% or $15.1 million, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. The increase was attributable to increases in net sales in our Branded Products segment, partially offset by a decline in our Healthcare Apparel and Contact Centers segments.
Previous wording
Branded Products net sales increased 5.7% or $10.1 million, for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The increase was primarily due to $11.9 million of volume increases within existing customer accounts partially offset by tariff refunds.
Current wording
Branded Products net sales increased 6.5% or $17.2 million, for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. The increase was primarily due to volume increases within existing customer accounts partially offset by tariff refunds to customers.
Previous wording
Contact Centers net sales decreased 5.9% or $2.9 million, before intersegment eliminations for the six months ended June 30, 2026 compared to the six months ended June 30, 2025. The 5.9% decrease versus the prior year period reflects client attrition that exceeded growth from new customer acquisitions.
Current wording
Contact Centers net sales decreased 1.8% or $1.3 million, before intersegment eliminations for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025. The 1.8% decrease versus the prior year period reflects client attrition that exceeded growth from existing customers and new customer acquisitions.
Previous wording
Gross margin rate for our Branded Products segment was 35.3% for the six months ended June 30, 2026 and 33.9% for the six months ended June 30, 2025. The rate increase was primarily driven by a favorable shift in the mix of pricing and customers.
Current wording
Gross margin rate for our Branded Products segment was 35.7% for the nine months ended September 30, 2026 and 34.2% for the nine months ended September 30, 2025. The rate increase was primarily driven by a favorable shift in the mix of pricing and customers.
Previous wording
Gross margin rate for our Contact Centers segment was 50.9% for the three months ended June 30, 2026 and 52.6% for the three months ended June 30, 2025. The decrease in the gross margin rate was primarily attributable to higher employee-related costs as compared to the prior year period.
Current wording
Gross margin rate for our Contact Centers segment was 52.0% for the nine months ended September 30, 2026 and 53.0% for the nine months ended September 30, 2025. The decrease in the gross margin rate was primarily attributable to higher employee related costs as compared to the prior year period.
Previous wording
Selling and administrative expenses decreased $0.6 million for the six months ended June 30, 2026, compared to the six months ended June 30, 2025. As a percentage of net sales, total selling and administrative expenses was 35.2% for the six months ended June 30, 2026 and 36.4% for the six months ended June 30, 2025. The rate decrease was due to an improvement in selling and administrative expenses as a percentage of net sales rates in our Branded Products and Contact Centers segments, partially offset by an increased rate in our Healthcare Apparel segment.
Current wording
Selling and administrative expenses increased $2.7 million for the nine months ended September 30, 2026, compared to the nine months ended September 30, 2025. As a percentage of net sales, total selling and administrative expenses was 35.3% for the nine months ended September 30, 2026 and 36.0% for the nine months ended September 30, 2025. The rate decrease was driven by Branded Products and Contact Centers segments, partially offset by an increased rate in our Healthcare Apparel segment.
Previous wording
Branded Products selling and administrative expense increased $1.9 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to increased commission expense from increased gross margin. As a percentage of net sales, selling and administrative expenses for our Branded Products segment was 26.8% for the six months ended June 30, 2026, down slightly from 27.3% for the six months ended June 30, 2025.
Current wording
Branded Products selling and administrative expense increased $3.4 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to increased commission expense from increased gross margin. As a percentage of net sales, selling and administrative expenses for our Branded Products segment was 26.9% for the nine months ended September 30, 2026, down slightly from 27.4% for the nine months ended September 30, 2025.
Previous wording
Healthcare Apparel selling and administrative expense increased $1.1 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to $1.0 million of employee severance costs. As a percentage of net sales, selling and administrative expenses for our Healthcare Apparel segment was 37.1% for the six months ended June 30, 2026 and 35.3% for the six months ended June 30, 2025.
Current wording
Healthcare Apparel selling and administrative expense increased $2.6 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to credit loss charges resulting from the change in a customer's financial position. As a percentage of net sales, selling and administrative expenses for our Healthcare Apparel segment was 37.1% for the nine months ended September 30, 2026 and 33.8% for the nine months ended September 30, 2025.
Previous wording
Contact Centers selling and administrative expense decreased $2.6 million for the six months ended June 30, 2026 compared to the six months ended June 30, 2025 primarily due to a reduction in credit loss expense as compared to the prior year period and cost reductions implemented in 2025 related to the closure of our Jamaica office. As a percentage of net sales, selling and administrative expenses for our Contact Centers segment was 43.9% for the six months ended June 30, 2026 and 46.7% for the six months ended June 30, 2025.
Current wording
Contact Centers selling and administrative expense decreased $2.4 million for the nine months ended September 30, 2026 compared to the nine months ended September 30, 2025 primarily due to a $1.2 million reduction in credit loss expense incurred in the prior year period and cost reductions implemented in 2025 related to the closure of our Jamaica office. As a percentage of net sales, selling and administrative expenses for our Contact Centers segment was 43.7% for the nine months ended September 30, 2026 and 46.3% for the nine months ended September 30, 2025.
Previous wording
Corporate selling and administrative expenses decreased $0.8 million primarily due to lower third-party professional services and lower share-based compensation expenses.
Current wording
Corporate selling and administrative expenses decreased $0.8 million primarily due to lower third-party professional services costs and lower share-based compensation expenses.
Previous wording
Interest expense, net decreased to $1.9 million for the six months ended June 30, 2026 from $2.5 million for the six months ended June 30, 2025. This decrease was due to a lower weighted average interest rate on borrowings, from 5.6% for the six months ended June 30, 2025 to 4.8% for the six months ended June 30, 2026.
Current wording
Interest expense, net decreased to $2.7 million for the nine months ended September 30, 2026 from $3.9 million for the nine months ended September 30, 2025. This decrease was due to a lower outstanding debt balance in 2026 and a lower weighted average interest rate on borrowings, from 5.4% for the nine months ended September 30, 2025 to 4.9% for the nine months ended September 30, 2026.
Previous wording
An income tax benefit of ($0.01) million was recognized for the three months ended June 30, 2026 compared to an income tax expense of $0.3 million for the three months ended June 30, 2025. The effective tax rate was (0.8%) benefit and 15.5% expense for the three months ended June 30, 2026 and 2025, respectively. Income tax expense and the effective tax rate for the three months ended June 30, 2026 was primarily impacted by the discrete tax benefit relating to the $2.6 million trade name impairment charge recorded during the second fiscal quarter of 2026. The rate for both periods was further impacted by the variability in the mix of earnings across the Company’s foreign and domestic operations, subject to various statutory tax rates in those jurisdictions. The effective tax rate may vary from quarter to quarter 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.
Current wording
Income tax expense increased to $0.8 million for the nine months ended September 30, 2026 from $0.6 million for the nine months ended September 30, 2025. The effective tax rate was 14.6% and 14.1% for the nine months ended September 30, 2026 and 2025, respectively. Income tax expense and the effective tax rate for the nine months ended September 30, 2026 and 2025 were primarily impacted by the variability in the mix of earnings across the Company’s foreign and domestic operations, which are subject to various statutory tax rates in those jurisdictions. The tax rate for the nine months ended September 30, 2026 was further impacted by the discrete tax benefit relating to the $2.6 million trade name impairment charge recorded in the second quarter of 2026. The effective tax rate may vary from quarter to quarter 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.
Previous wording
Beyond the next twelve months, our principal demand for funds will be for maintenance of our core business, to satisfy long-term contractual obligations, stock repurchases, any potential merger and acquisition activity and the Company’s ongoing capital expenditure program designed to improve the effectiveness and capabilities of its facilities and technology. 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, acquisition-related contingent liabilities and non-qualified deferred compensation plan liabilities in Other Liabilities. 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.
Current wording
Beyond the next twelve months, our principal demand for funds will be for maintenance of our core business, to satisfy long-term contractual obligations, stock repurchases, any potential merger and acquisition activity and the Company’s ongoing capital expenditure program designed to improve the effectiveness and capabilities of its facilities and technology. 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, acquisition-related contingent liabilities and non-qualified deferred compensation plan liabilities in Other long-term liabilities. 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.
Previous wording
For the six months ended June 30, 2026, net cash provided by operating activities was $17.7 million. Cash collections from customers exceeded aggregate cash payments to vendors, lessors and employees, primarily driven by the Company's collection of receivable balances and by reduced inventory purchasing, which provided $2.4 million of cash in the current period compared to $10.7 million of cash outflows in the prior year period. These sources were partially offset by an $8.2 million increase in contract assets.
Current wording
For the nine months ended September 30, 2026, net cash provided by operating activities was $30.7 million. Cash collections from customers exceeded aggregate cash payments to vendors, lessors and employees, primarily driven by the Company's collection of receivable balances and by reduced inventory purchasing, which provided $0.1 million of cash in the current period compared to $10.5 million of cash outflows in the prior year period. These sources were partially offset by a $3.9 million increase in contract assets.
Previous wording
For the six months ended June 30, 2025, net cash provided by operating activities was $2.9 million. Cash collections from customers exceeded aggregate cash payments to vendors, lessors, employees and lenders. These cash payments included $10.7 million of cash outflows for inventory purchases, up from the prior year primarily due to the timing of purchases.
Current wording
For the nine months ended September 30, 2025, net cash provided by operating activities was $1.3 million. Cash collections from customers exceeded aggregate cash payments to vendors, lessors and employees. These cash collections were offset by cash payments including $10.5 million of cash outflows for inventory purchases. The inventory balance is up from the prior year primarily due to the sales decrease in Healthcare Apparel, as well as the timing of purchases.
Previous wording
For the six months ended June 30, 2026, the Company had $26.0 million in borrowings and $35.0 million in payments on the revolving credit facility. For the six months ended June 30, 2026, the Company had $2.8 million in payments on the term loan.
Current wording
For the nine months ended September 30, 2026, the Company had $33.5 million in borrowings and $63.5 million in payments on the revolving credit facility and $24.4 million in borrowings and $9.4 million in payments on the term loan.
Previous wording
For the six months ended June 30, 2025, the Company had $57.0 million in borrowings and $41.0 million in payments on the revolving credit facility. For the six months ended June 30, 2025, the Company had $2.8 million in payments on the term loan.
Current wording
For the nine months ended September 30, 2025, the Company had $76.0 million in borrowings and $58.0 million in payments on the revolving credit facility. For the nine months ended September 30, 2025, the Company had $4.2 million in payments on the term loan. On August 7, 2026, the Company entered into the 2026 Credit Agreement that refinanced the 2022 Credit Agreement. Please refer to Note 5 to our Consolidated Financial Statements located in Item 1 of Part I of this Quarterly Report on Form 10-Q for additional details on our refinanced debt, which disclosure is incorporated herein by reference.
Previous wording
During the six months ended June 30, 2026 and 2025, the Company paid cash dividends of $4.4 million and $4.5 million, respectively. The Company anticipates that it will continue to pay dividends in the future as financial conditions permit.
Current wording
During the nine months ended September 30, 2026 and 2025, the Company paid cash dividends of $6.6 million and $6.7 million, respectively. The Company anticipates that it will continue to pay dividends in the future as financial conditions permit.
Showing the first 40 of 43 pairs. Open the source sections for the rest.
Rearranged current paragraphs (4)
Current report — wording carried from elsewhere
On August 7, 2026, the Company entered into an Amended and Restated Credit Agreement (the “2026 Credit Agreement”) that refinanced the 2022 facility. The 2026 Credit Agreement provides the Company senior secured credit facilities maturing in August 2031 and consisting of a revolving credit facility in the aggregate maximum principal amount of $125.0 million and a term loan in the original aggregate principal amount of $75.0 million (collectively, the “Credit Facilities”), and the ability to request incremental revolving credit or term loan facilities in an aggregate amount of up to an additional $75.0 million, subject to obtaining additional lender commitments and satisfying certain other conditions. Please refer to Note 5 to our Consolidated Financial Statements located in Item 1 of Part I of this Quarterly Report on Form 10-Q for additional details on our refinanced debt, which disclosure is incorporated herein by reference.
Current report — wording carried from elsewhere
As of August 31, 2026, the Company performed its annual impairment test for its indefinite-lived trade name intangible assets, which did not result in an impairment. The estimated fair value of the CID Resources indefinite lived intangible assets exceeded their carrying value by approximately 2-4%. A decline in projected revenue or an increase in the discount rate could result in further impairment. We conducted a quantitative assessment using the relief-from-royalty method, which we believe to be an acceptable methodology due to its common use by valuation specialists in determining the fair value of intangible assets. This methodology assumes that, in lieu of ownership, a third party would be willing to pay a royalty in order to exploit the related benefits of these assets. The assumptions that have the most significant effect on the fair value calculations are the royalty rates, projected revenue growth rates, discount rates, and terminal values. Each royalty rate is determined based on the profitability of the trade name to which it relates. In determining the fair value of our trade name indefinite-lived intangible assets as of August 31, 2026, we used the following key assumptions:
Current report — wording carried from elsewhere
• A long-term growth rate of 3.0%; and
Current report — wording carried from elsewhere
• Long-term growth rate of 3.0%; and
Rearranged previous paragraphs (2)
Previous report — wording carried elsewhere
Gross margin rate for our Contact Centers segment was 51.5% for the six months ended June 30, 2026 and 53.1% for the six months ended June 30, 2025. The decrease in the gross margin rate was primarily attributable to higher employee related costs as compared to the prior year period.
Previous report — wording carried elsewhere
As a result of an interim impairment assessment, an impairment charge totaling $2.6 million was recognized in the second quarter of 2026 to reduce the carrying value of Healthcare Apparel trade names to their estimated fair value.