Superior Group of Companies (SGC) 2 Mar 212020 Q4 Earnings call transcript

Good afternoon, everyone. Welcome to Superior Group of Companies 2020 Fourth Quarter and Year End Earnings Conference Call. With us today on behalf of the company is Michael Benstock, the company's Chief Executive Officer; Andy Demott, its Chief Operating Officer, Chief Financial Officer and Treasurer; and from the Promotional Products Division we have Jake Himelstein, BAMKO’s Chief Operating Officer and CFO.

As always, upon the conclusion of the company’s remarks there will be question-and-answer session. This call is being recorded, and your participation implies that you agree to this.

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we XX in Here achieve to XXXX. than years later, five are the more able were times we revenue

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but same XXXX. continue accomplished the unprecedented path deal We on human investments require saw XXXX, in during we additional growth will that a capital. great We in

our future. so will have past leveraged in infrastructure deliver continue record investments resources control and do As shared to and the our in the setting results, we costs to we

This to and $XXX over XX% in annual sales the is net results, an XXX% income highlighting with impressive strike. further were million. remarkable truly net resilience our increase by up outstanding along Our million $XX

key to will, our pivot in more net net sales business PPE from that. of even our net sales and three achieved in the color growth sales income, of should segments, the Andy all noble we provide again, emphasize While organic that to we without was impact PPE. sourcing of growth in to course,

in still gowns, our supported scrub we're PPE, such much Earlier retail be as in as of for well bolstered our protective as long-term. PPE employee reasonable coats organic as majority for we and demand year. will business continued much we growth year, has sustainable sectors, quarter, well including the third isolation seeing as healthcare in scrub reported And barrier and we the As our for apparel, believe inventories which which of apparel. legacy this the apparel, in our ID

CID to warehouses. respect the collection retailers increases Fashion mostly our products, fashion about CID Healthcare customer essentially innovative substantially in we INDY our Fashion with also in At for Seal spoken by previously CID. to scrub and even Our e-commerce and arriving sales new This saw sizeable with traditional We channels found Healthcare margins. WonderWink base. line for across Seal spoken move was particular, needle a before our new revenue designed in operating

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excited are to forward addition the continue its our longstanding others of partnership to who kind our scrub have the in come and them We years. first many support offering success long-term with of to

period, three-year will that a distinctive represent figures We fashion expect greater high to increasingly this wide anticipate up for than ramp sales. in it annual and scrub over seven acceptance

CID. We work strategy our on marketing to continue international through

at last we markets selling As are healthcare quarter, into apparel currently we European modest levels. discussed

us our our As those employee part long-term to have distributing warehouse and including our sectors ID base. a non-essential Poland retailers, was entertainment be in by strategy, begin across This down our industries. robust build portion HPI, HPI and our base, our allow employee will markets. smaller the to to sales offset products and of essential within COVID box declines dining diversified largely customer closer essential business the retailers. including were customer to footprint we to of non-essential customer our business with contracted further from XX%. businesses. These This Revenue grocery ID and sales chains big pharmacies, by includes almost base travel, has

seeing the stabilizes year, as RFP While a of lighter business, we normal. expect usual activity new activity resumption on of the do environment side a the in than we to higher were HPI’s later

continues. many with we uniforms experience business As that is chain products establishments meet supply on The night certainly but most, challenge Demand this should products. and all how how non-essential the of market. people, specs the often for sufficient of side globe if forward. our can can not hire of we side to extremely of much strong legitimate the provide capacity The reliable our and will source mitigate going day working sell, essential remains that a our have increase and for not width more rebranding their The tight has rigid find help on teams will the business. the PPE and downturn or still across been We're supply. still we and need

pivot and milestone. expertise, in to for million, sourcing about a say with Office our unmatched Gurus is team pandemic and amount product of our a non-legacy normal by employee solution the across and While of going an positive still or uniform team's the customers growth the part delivering creative and be that sectors the a products identity. mandates. that to but won there turned into of to double start-up many PPE. opportunities new pre-pandemic as agent support of I XX% BAMKO to all PPE protect profitable sales We what part their be report team year. and opportunity shipments tremendous demand correctly call Products their substantial The by sustain a us were head Through home customers help not enabled clients we quarter of agents. their our customers, work pandemic things very which people $XXX Jake are high digit the returned on anticipating as to Promotional our those products early brand segment, also our all count to of only the our use an increase the that X,XXX exceeded expectations on-boarded crisis a of lockdown quite nearly timely midst colossal employees including customers business over the several fourth by in ever-changing to their will kits, eclipsing to would grew enough PPE In a from in to during can't government XX% XXX continue further, increase in their

many centers besides We to their other are solution. use considered who beat call customers proof by of ours pandemic our

logistic work in include our shipments. the ocean in happening Uniforms worked increase on ports, air both to about dollar. well Other to impacted logistic backup a standpoint shipments weakness as pressures overseas excited costs is make further. some scarcity to pricing the from as We lack the and and caused containers and serve associated home a the Coast of our are We business with bringing challenges, has customers domestic our businesses the across to including of well-publicized Headwinds opportunities West trucking, side investments, ability will terms chain fabric supply scale its of of container as saw demands. costs of costs from as from need and this in logistic with our challenges Products logistic into availability truckers move as well even the elevated modest growth we that of shipping freight, than and warehouses. freight product we all severe in more means us our Promotional doubling surging, to This

this As pressures, of the many increase and a call to that these I now back Jake implemented at price discuss BAMKO’s will close. quarter. you then effective to to results, largely result come sizeable a we turn the over is

our afternoon, everyone. team has good BAMKO ecstatic a such and Michael, you, Thank year. results at challenging delivered I'm with the during

crisis QX $XX.X during quarter with Our XXXX. in improved and year's presence the BAMKO fourth marked year ground and from the prowess increase opportunity. quarter. us on a Asia ended Operating XX.X% our Sourcing a Superior compared fourth to margin by million, to of last distinguished sales XX.X% X.X% in

were increase For sales to greater on promotional compared product XX% margin $XX.X down million in XXXX. XX.X%. deliver increased economies actually headwinds margin Industry-wide massive we BAMKO’s sales or realize the XXXX continue testament XXXX, X.X% core powerful XX% industry growth XX% by operating promotional scale our spend scale approximately XXXX. a to an ability operating was year Despite full product of as margin these operating BAMKO’s in leveraged XX% in than to our to $XXX trajectory. XXXX. of our approximately This to increase year-over-year to over million, is compared We

quarter the still fact, was reemphasize, a In when of in out year down was quarter in and where year-over-year. up XX%, PPE, promotional sales year-over-year, the our up single XX% BAMKO overall industry history. was BAMKO’s BAMKO’s XX% fourth stripping of was largest product To upwards

promotional a steady in substantially year, Core product gifting. the increase QX the market. challenging three in quarters in saw first of very a in employee performance we increasing remarkable sharp a Just sales as were before

$X.X million $XX.X sales. and which Our in million year $XX.X backlog million, was in consisted at end of PPE non-PPE

challenge product to challenges the spend. backlog BAMKO’s timing largest in events. non-PPE opportunities continues a slightly backlog return conferences to prior showing the also market. in total both the large-scale It's brings year-end backlog the products it, the resurgence primary quarters, a promotional history. of figure increase, with than is lower XXXX promotional and While regarding and is A

of least second the Something the until we at occur expecting are half year. to not

strengths, diversified less sector. as meet these BAMKO’s the acquisition, large. whole. programs, virtual it industry conference clients a segments as for of and performance the the Fortunately, reacquisition include well consumers. prepared the portfolio well-performing served of other beyond gifting, And programs, opportunities purchase is gig All renewed market to return. gift such and of customer the customer areas BAMKO’s told, much on better continued home BAMKO than substantially strong products These retention by items take has A with includes industry event-based gifts challenges and is business a number demand BAMKO economy events at promotional as industry positioned to sectors in than

an positioned segment. large Design we industry incentives, Our awards, which We as rapidly leader with clients. and both acquisition programs, vertical sales to become leverage Gifts product immediately view to companies immediately current to recognition corporate and increased an growing this future offerings. BAMKO extend and plan to client our important By and of By base joining will in market and forces, force better become capabilities

and a adding vertical. talent are untapped proven in leadership previously We

I'd honored close, as that company Los to in of Angeles. the like again, one all Medium-Sized I by out was Los Journal point number Business the Angeles XXXX work once to Before BAMKO in for

culture salesperson best recently which of awards team reinforce the turn are financial call publications, year and achievements, over Additionally, commitment these to and boss Andy our members operational his by as Promotional quite the I'll impressive for now BAMKO trade Products won selected and our the for review. to of people. our

Good everyone. Jake. afternoon, Thank you,

cash at results. cutting moves four profitable of year. for flow aggressive team an unprecedented growth addition strategy, the in times impressive cost exceptional our quarters us an austerity to sales and midst and to Our in Timely delivered performed level improve allowed the of

from improve XXXX. of This ratio of to times which X.X end highlights debt times line at to historically our December the our down EBITDA a position, to and times debt to in X are liquidity bringing leverage our nearly under EBITDA covenant range XX, limit. in full year X XXXX We X continue well with we desired in our debt and

For governance, $XXX financial continuous XXXX. as long-term improvement across $XX.X opportunities shelf us arise do a acquisitions the October This the for statement flexibility large sales year, through our and and by million debt our registration a they matter as on in we of we million. prudent financial We greater for business reduced lens gives of filed a strategy And corporate operational universal future. outstanding platforms. XX,

We and extended at $XX continued credit to maturity our also terms the million to very revolving our agreement favorable growth. by increased XXXX support

we to During greatly further the process to enhanced SAP resources of organization completing our I'll the continued accomplishments. upgrades efficiencies year, software briefly functional that finalize our and automation, CID, make bolstering collaboration capabilities. and and elevate business our investments key technology in driving some highlight model. across fulfillment optimize critical implementation We cross shared

All businesses of segment operational now SAP. uniforms our on fully are

manufacturing our a expand to us competition. presence own in advantage production giving from with Haiti being our continue factories, We distinct more our sourced over

we able of three a reduce month, stronger even take margins beginning to improved per are As we year quarter pricing. package we expect incoming XXXX. full more this position in $XXX,XXX savings into nearly should in product. This fabric, Overall, a translate on on

distribution Arkansas, distribution. investments are upgraded robotics expanded and the midst distribution continue in new and make and Dallas. to Eudora, facilities in of our installation We Arkansas the large our in facility our of in We

XXXX. be laid the in new to system expect We operational

Dallas of the Additionally, installation now. our CID at are up we center robots and in wrapping distribution

facilities in help of the $X.X warehouse the recognizing a Georgia investments continue efforts. The of accordance that Georgia to December drive distribution our on HPI completed last optimization in gain of completed down consolidation and XXXX, further. the late year will sale We in was strategic of even with to our million. expect us costs sale these Arkansas We

XXXX. had comparable sales tremendous to so as outstanding continues Turning $XX.X to opportunity million to XX.X% finish economies double-digit with high XX.X% products Uniforms continue net we to $XXX sales or reiterate sales. needs. on-boarding division, in versus to the Office Gurus in million existing million. million result, for from The scale. increased contributor XX.X% I'll fourth the in $XXX.X Throughout net redefined highlights, promotional their significant in we year, a our new BAMKO’s XXXX. PPE million. period just products of growth million a execution that customer that sales net related $XXX,XXX reviewed growth year largest of it XX.X% BAMKO well returned and the financial the a the excellence $XX that with reported relative $XX.X margin see increase The quarter leverage to Jake as to quarterly of operating to realize the of accounted customers, up team sales meet was in to as third-parties successful servicing $XX.X customers to with changing was

sales of based product XX.X% For as margin profit to the of quarter, margin quarter as the and XX.X% fourth margin to we reported is percentage on defined consolidated increase This gross in attributable XXXX. sales higher compared gross a mix. of customer

$X.XX across As net XX% improved cost reflecting of for from with fourth X.X% fourth for increased $XX.X to per sales to higher versus operating increased Income business mitigating quarter share operations or to $XX.X operating to all net million diluted the Overall million from sales, $X a SG&A X.X% to combined margins control almost diluted volume actions the $X.XX ability continued expenses. in per compared to XX% million percent over year’s expenses share last last quarter segments fourth quarter XXX% fourth period. income our quarter. same consolidate leverage climbed and the year, or

year our review $XXX.X to year-over-year full significantly sales million, the Uniforms by guidance $XXX.X XX% XX% On to year. to results. for shift the sales let's were million. net rose a basis, exceeding up net Now clearly

home Of December total and we posting compared the XXXX. XXXX. backlogs uniform of $XX.X $XX.X in a of note, loss included at with QX the in versus a the facility end resulted our pay year ended year end Additionally, solution. and zero $XX.X continued end a had willing in to we increase place zero deployed as layoffs million in to were backlog pandemic record deployed TOG work our PPE TOG revenue, solution. shelter experienced XXXX which in zero work employees from all of who record El of the to $X.X at BAMKO total we for work notice, on from year our million the of the XX% while segment Salvador at with million due to closed essentially XX, million mandate of roughly posted increase in XX.X%. an home TOG was an

consolidated As a the to percentage reported net year XXXX. of XX.X% improved sales, to in SG&A for compared XX.X%

worked maintain to To to XXXX. discipline bad while XXXX, million our business achieved continued receivable disruptions. end, percentages. ability in continues through pandemic cost compared Our leveraging SG&A, higher accounts despite We sales volume $X.X planning, in improvements our segments our in debts improvements the increased bad SG&A noted in balances, provision we across potential to as drive uncertainty from and $X.X economic for scenario we related to as debt given this million budgeting in

market liabilities, contingent expense incurred driven result acquisition-related by liabilities by on also million fair of operating the a $X.X in adjustments of tremendous an and delivered Promotional BAMKO increase in primarily segment. value Products as the results We these

to gross compared XXXX goods for were of to by X.X%. Despite ago. XXXX per operating $X year $X XXXX $XX.X periodic million as compared increased million our approximately to margins per the mix million million XXXX. XX.X% million of by million to last year in operating compared year costs to XXXX, changes. this XXXX to compared income $X compared compared X.X% income our XXXX due Diluted $X.XX to improved per in as more share rising XXX.X% rate net million costs, grew and $XX.X was to than to to expense $XX.X of mentioned, share share effective logistics in XXXX. greatly Our compared impacted to margin million by for $XX year. to year customer year tax pension $X.XX Overall, operating was Interest ago. margins improved profit XXX% compared Fiscal impact, XX.X% segment a product to XXXX uniform $X climbed were and a for million. earnings the XX.X% cost impacting to by sold Michael XX.X% primarily in overall $X.X

cash balance sheet a and continue decrease for cash our XXXX, we last year. had at Now equivalents million. million manage is of since cash a few prudently flow, This highlights, December of and to XX, $X.X we $X.X

$XX used of facility. to During We from was dividend excess XXXX, borrowings $X.XX our on cash million revolving cash which $X.X in repay our recently shareholders shareholders per paid we quarterly XXXX. total, share, to XX, outstanding to credit February returned operating our announced was activities our In dividends during increased in $X.X year a anticipate in to range $XX.X million million to of expect XXXX. heavy CapEx and for CapEx $X.X the automation expenditures investments compared We year, continued million year we this to investing be $XX for ago. our million projects XXXX. the to

our I'll back strategy closing his for agility the remarks and very to challenging general Michael executing quarter growth. profitable now XXXX. for call a environment fourth Our the long-term navigating superb and for full outlook year while team a results and reflect turn

Andy. Thanks,

to tremendous nearly we and described in The pandemic, as facet the in will BAMKO, highlighted differentiated traditional to storm our customers by At we and during miracle. TOG, and a services and provided critical PPE. competencies our promotional At of was so to a to do support excelled several XXXX lives, as epic, a crisis pivot of for home Our only our global the in our sourcing We milestones can a non-essential product ourselves every impacted and showing core in agility our that across emerging from segments we of businesses. to all gains be delivering performance the short we the of long-term. reached achieved products essential midst ways business. nothing year that of be result sustainable

As to efficiency agility the and display we look the company. ahead, about as we a we're that excited continue

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will Haiti As Andy our mentioned, third-facility our capabilities. near-shore production in increase considerably

Haiti, XXXX, all Haiti manufacture manufactured XX% including As factories about matter in our our of factories units. contract currently of of uniform production. fact, total a All of own XX% in in our our factories

the this All our that more our in manufacturing XX% of year, should XX% environment. overall units. contractors, exceed is approximately by will be so case numbers done and duty-free total own XX% factories this of grow will in than the each This

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Our each I’ll last with it. in keep ultimate find the and as mission repeating prospect right that the fit, to call, is

partnership BAMKO about that as synergistic, forces Gifts that spoke opportunities the will their bring ability example integrate joining extremely substantial the quest being Jake to welcome leadership opportunities we're pursuing is ahead. great that team in corporate a win-win with periods our highly quickly a and family. of is By SGC We discerning sets Design, for that have short to integration are reminder, a our As accretive, smart, have into culture. seasoned and

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to future a building, foot to also growth. also promotional and warehouse current is We being handle as our all replenishment which uniform segments built will XXX,XXX leased in right for a now handle receiving, Arkansas which square serve

We which is our management about of efficient facility, in more later system pace installation even are completion main excited an semi-robotic the Arkansas warehouse this on for year.

plan spoke coming gather we're retailers’ our Andy a efficiency space since about in sales expect achieved machine online retail constantly to year. Phase in the group we employee our transparent group to implementation e-commerce month robots each strategy making customers been something As later completed our these the and customers for group We're excited be this visibility channel down steam group provide Rollout Giving with their will facility has Two awareness wrapping our this in learning, AI both to the brick not past. support to lot that through of in helping what We're service amount bring robots expect One our digital platforms, known group customers. which partner the retailers do at and business. with this to is achieve. of reduce up our spend will the campaigns, sales. as to our costs higher and our of strategies. of improving new progress months, operate with better Dallas in particularly increase a of to the their Phase of many evaluating planned, to dollars many mortar, sales marketing to certain is future and the as We're brand to over to technology We

take More Please are bolster us ranks. X,XXX growing growing. our are gone X,XXX than people themselves our the Having continue we faster of industries in a note the to businesses to each is to to this level. from needed year We our growth. at rate that management support next to associates

team Throughout our supported our operating members, As we our Companies much history, XX case our record served proud financial in We're this of we've our missed proud you must and of listed also also results. live as year Forbes across award recognizes be customers, America's take number we Small market and XXX levels. which increase us teams new it, work. of our in many the talent to our share, shareholder for continuously of We're brand building communities by winning have return enterprise. Best to we magazine, to cared

of and call greatest of organization's one find during We this built business. ability to excel open endure. to XXX your questions. We like company to ourselves challenges is as our resilience commanding for our we'd attributes. we proven that, enter year a With Our in the position

ahead. [Operator from now the Kevin will question-and-answer Instructions] We Please Barrington go Steinke begin And Research. the session. question first with comes

but to in wanted strategy everyone. the international about you opportunity to now? your about U.S. by Europe last start-off you just time for internationally you to market this you CID. and in and growth again internationally similarities, good and move it's on It differences, I the talked about what a dynamics like afternoon, touched the Maybe call talk CID. there. CID feels why know asking could Good compared I And see with quarter, on

has effort part. fashion very before in of selling small in demand scale. marketing very as Mostly bit products. has of them South purchased little Australia business business all we CID in on going time our Okay. a in very been those scrub good or bit little a There's internationally even on increased markets for XXXX given has a on little with America, Europe in of and that

healthcare And nurses workers that think scrubs, they short want they to of scrubs. even supply world. weren't ubiquitous, more are are on I wearing afford that make depending we always but And healthcare when them supply workers launder home peers fashion them. is a today. Very can in and hospital over scrubs. taking generally the healthcare the around And all maybe what workers their countries the they're conscious scrubs, oftentimes than world fashion

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duty they're to another And ship to course, to were country. they Of shipping and countries. it smaller duty those expensive drawbacks are some very that get when get back of can for you paying duties, containers costs logistics

central that be a its gateway sell. third-party So we to parts. would become distribution the want place to we in location that It's for we going countries did were put Poland, logical to to the a decide other

It's a say ��� – Europe. we're us to I'd For it's commitment strong beyond making it's a experimental the stage.

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et in do some your Or of or kind Okay. that competitors, differentiation you into the fashion, that who've of the that have helpful. from products – kind same CID advantage feel fits, terms perspective? Yes. mover That's you have have do bring? comfort, Do differentiation Europe, they moved cetera, you that first already of like

No.

were this to Line, channels through that a constantly except except is for constantly sell of standpoint, compete might I advantage – some in them trying are companies who do from they to are the out we totally United have the product we reach think I had Indie a that for we which are mean, unique, the same good – have. we Many do – job the same great the I other States. don't. they these with people think of we

share isn't certainly same they level do advantage field. see online? We – don't is unique everything the or we. we I somebody XX I getting lot us a of in product from terrific in else, have market quite in thing or So there United can of it's States these buy that in we're companies would started some a same We to have product do and it first. the why as our a shop frankly, over Our playing to. United in think, a think except the years to And Europe. business intend first States. them took been CID the

or your It the SanMar And you're with you great. this it's guess Okay, Corporation. new I seems the like referenced about. partnership then partnership channel is WonderWink excited

talk that bit pipeline that of are see? in just about the more similar opportunities a you little and there types So you can

customers. can There support we're retail as of we are continuing to constantly – omni-channel become our as base to working

SanMar collaboration making the so a we sure in long us. When big had with right working And win time was for for a them, that products. on

most into competes all lines pretty in who's take interestingly. the And mostly essentially So That big and to United service probably they customer to States entire SanMar probably inventory that very they is promotional in And essentially walk up apparel. understand is United sell can in be customers scrub pages salespeople competitors. but doctor's some positions with apparel. with, able The that these regarded companies show on. to States highly now into are there'll – practices might and with multi-interesting not, you to And blurry and be XX the of who actually XX,XXX XXX,XXX a allocated – it's supplier are and BAMKO a the servicing between our their had the those what apparel terms competitors, so different who's product practices and probably industry catalog dental companies plus apparel.

us. We're whole world excited about December, the month. back a in last a it. to press release So new they announcement did very made opens for they It sales their force up

It people – as well. think support we're will frankly, of have we're we we'll We something. all an to It from they're believe – for won’t doing. be all they to We be end. support help turn commitments into it's their be exciting to going it's putting already going Quite choosing us partner. it we're it's – multi-year right them. what the made that additive and will the choice them us smart efforts to But and marketing no, and our business into channel

to trying put pieces just I'm fantastic. here. together some Okay,

into little that press XX%. talk going in opportunities laundry all there and expansion out It's their a of had I of for are I for organic this, partnership are, the the interested public So because I'm saw it's XX% that kind out ability release bit that from that this you about more grow interesting But like you then then announcement referenced WonderWink you frankly, SanMar as international thinking the really about about of the your types And et talking UniFirst build uniforms call, or seemed or mentioned you're what's WonderWink. partners, to adding it that moving CID. is about had information investors with to there. these aggressive. cetera, up target post put to to at growth sounds But last channel pushback new channel,

So kind any build how you growth to more targeted of what – that that there? that color you or out rates up on put that

growth projections on opportunities earnings we account, hadn't that pretty the a felt Well, yet. although made these last and Sure. confident lot into the in of announcements our call, been took

larger this into it. growth the rest opportunities, So taken those We hope were well I about the of projections guidance future the Europe. particularly know and with that both as in a growth account out of People very we excited come pretty world, felt entree we in can it. to we've as last has to our number our yes, put We been earnings XX% calls comfortable for be about giving But that, better tend guidance. conservative nature. us. And about feel we wouldn't very unless given. confident we into

the last you of the we've that, usually see I over exceeded years. market think could few expectations

to we that. continue So hope to do

Great. That's helpful.

non-essential RFP just up some clarify, kind was more for set? business, more just color pick can you was said, across briefly customer know going the board of can little uniform side that on later it HPI on expected the just of mention that the say there did I Or on of and You maybe what's the to but that. a there? you you activity

going doing extensions, not RFP side is even – those rather all very contracts now. a right through not business right get uniforms They're we're worried, busy of to they're now. extension seeing tremendous – buying we've And and activity seen tremendous than Sure. not essential they're right redesigns side The so happy now. some the of essential doing just kinds the of some

of service, get their think they're of whether focused some the and I customers they're it's even is business restaurants aspects figure service to non-essential see trying to reconfirmed I you that when in out out scale have they their business large nobody's their their, to how and they the take eating trying side, up and how more pull efficient to instance, to in quick trying on how for the of we make different so space to can mean, make more window, make themselves a – what better all to drive efficient of inside. use

it's So it's there. to just out RFP It's seeing time out there all. saying much the I'm there out activity. a funny not at It's kind not just of we're not lesser where a degree. not

And non-essential I they over. is is what of not still worried of PPP when survival, for on been It's in think still about front trying to side, out mind is got first to thankful Kevin, is world – have companies, about this money, what figure fine. survival, the mind the they're be lot uniforms. going a worried of all especially but not

programs We have uniform them. with

or then customers cycle. the years next normal some of years for fine initial of who in periods a contracts. in the We with we're have we're year us. that half – business doing will chase the a that's customers beyond the more two cases likely extensions extension I'd already see some recommit won't few in business contracts get probably or we and rather, with XX any that And for

that an Things So country normal and wanted came that has recession come we back people the mean, people I normal, we they've incredible this more as spent, for in and dollars same XXXX do And in shopping us bit I allowed activity. see marketing benefits and We've will expect you my of come to back in marketing restaurants the to vaccinated, when RFP was out and things malls of what are they that dollars one our We rebrand. again past, recession never that maybe to get script we lot seen in were, BAMKO thing but of do seen to today. little in out as get on. they businesses, start spending to people in the to and past. of sure. could more here a so were lift see back spoke to the people more them and benefited in numbers. actually the A

a more the come even expect robust be this this, of has never so it'll out And quite We've robust, a maybe we way ever. recession when than never impacted pandemic country we has.

to all about at to somewhat worried to continues, their Because PPE them people as their a but lift, the way. it to fits level, diminishing expect I'm view even differently. customers we long need give continue essential well. a not So to a we're it. to is businesses, pandemic sell employees It’s it as together, of try rebrand as want the going themselves, what the they and want modicum

this changed business our is uniform for year respect nothing So our overall and with guidance with we business to for year. gave this that our

mentioned in event-based. outperform less I promo XX%, everything. move customize color traditional your just products what’s terms it the the Is XX% chain, the to Okay, Maybe overall significantly. spoke guess, a more promo you growth you fantastic. allowing while being overall the And guess, products more on in just probably to to ability down little XXXX maybe about financial bit of I is in wanted you to speak industry But to so BAMKO and on your there. that BAMKO. I strength industry be traditional it’d the of to supply strength XX%

you’re the Jake The call trades, BAMKO. on of CFO Sales and and Operations ahead, respond. let runs Jake Jake. of so all Jake, go our I’ll Jake and

Thank again, Kevin. you

we’ve that COVID. our XX,XXX competitors pivot more down think segment, are I you able on Promotional We in we’re have can’t very of base. our are do. mentioned and competitors and at like look them now been PPP supply and not some I when they companies, struggle converted promo minor And around we lot sold of be PPE held quicker, XX% the something diversified So by is non-customers the small we PPE to year. opportunities capitalize of mean, pick which the the over really we’re Products the And XX% with there up I our a pieces. our to loans, customers. XX% in many when it of industry successful. may been and up there’s to up, through XXXX dry before sales truth the those prior that

Promotional continue We and to to to business. with get their Product opportunities additional work these customers penetrate find

So we’re boots ground, And of seeing being going of on positioned XXXX the ability forward beyond. industry. rest agile, and and for the all forward-thinking stems do having here were And from like, being the that. ahead we the it we’re to

you particularly growth employee BAMKO, to the gifting benefit regards spoke their by with gifts made Design. in Also By Gifts quarter a Great. about to being fourth and

and you saw growth in that particular in trend investing the acquisition. you’re that What’s niche what’s there? So you’re apart, seeing through recent that attractive this

coming and Yes. at-home these this to and BAMKO. the employee go customers. done we it. about By employee and that side of acquisition gifting core customer walk We’ve on a We’ve in-office before done ask, our something that huge would and we quickly, the and to None on hey, customer It or access business. we shipped customers that we what more to us walk And speak us and base the do continue gifting to employee when did there employees, want of program phenomenal. post-pandemic, But we out to We did chip expect work substantially the as sell this model engagement a are connect all have for kind The always employee it’s a And companies right? kind home gifting, the know And retention have and the XXXX portion to didn’t more. in to away that. want is gifts what Design with going really a talk home they programs. substantial happens wasn’t the us of need Gifts want recession, Michael that focus of at a customer we blue make to of desire people to to and base. you always speaks to more customers home their the They with But December this works at-home or of be in don’t employee able going to our gifting do month of throughout engagement keep pandemic, forward. stronger keep talk got to with employees at ability said, makes out do know combined, want probably to we know of engaged. for was it to to programs connect into just they of them, employees. then coming and capitalize work and be history direct of of

interesting. Well, really that’s

Okay, great.

Okay.

activity So robust. is mentioned you M&A

the M&A of just I all to on you’re guess, the opportunities is the I nature mentioned the or larger this seeing capital in seeing get What’s the perspective acquisition candidates size of pipeline? the that there, raising size You fronts? robust you’re be of recent are pipeline shelf prepared so the I’m pipeline in registration, a you opportunities necessitate that more perhaps in and putting want the to lot on but seeing. would

There a lot sale. There’s markets. of a for sale of for companies lot in companies all are

it many them to a some to at us. on chance we’ve quite that look pandemic, frankly, in interesting of were the had wasn’t trouble really During and such

of made Some all there a help it it business we companies, they that ranging little entire are something to or to or There sizes a because their sell few. was bring We business from million in to way There’s can million. way does, organization that companies, bit us were I’d the open don’t the we but of only $XXX up wasn’t to $XX our that million of us it line Kevin. from million. $XXX to brings profit uniform really them, there, received say, many into people something tend do the low. keep money. them, that don’t at grow great probably small for help they even has promo sand we unless there aren’t draw that only the they Even kind out – look – a currently aren’t the that’s able all to about many frankly, quite $XXX standpoint PPP

And some of them trouble. have gotten in

of Some people. taken a has just this them pandemic toll stead on up, are

an forward job, during devastating standpoint, grips moved never doing had the done incredible we probably when worked harder. was from it for was never And most energized We’re family and lucky everybody. we’ve – we’ve the more and been a It’s time fun it. it

think of warehouses, our all systems all we but in position we’re in So, we’re of a place of well, our now – our done, unique our most with integrations with expanding center with. be business. great each done No, of the call our our small to business begin integrations in pretty businesses, the center platform business a is to are medicals, call a

us businesses, look that into we that So we’re maybe their space add is currently. or we to looked we’ll threshold value a is at But businesses million. something get feel have continue $XX under not and at

numbers CapEx This XXXX more in that’s little that but the to helpful. $XX had here, little close a is around No, mentioned million you would Okay. $X thought just be you a came than mark. million, maybe you on a lower of last and question call in

ramp some looking So up CapEx for more? there and little talk but year a just or about next. you catch timing know next little a have to did up accelerate more bit I things you’re just maybe year, you wise, this were a able

we prepaid expenditures. up essentially there in down getting Haiti, on I the with third of ended adding things Kevin. a Yes, is the facility but couple Michael capital year. mentioned late in run mean, in were through does what a lease ready that

in in we And the PPE. saw have very all forward. going get an very will headstart that, a in. that made we was perspective and on But we a earlier year, it bit. invested off to robotics quick payback the to very very sense opportunity pivot add to that also a Dallas, really nice and a pre we was take to based some our get We things the of on did which paybacks as And things that down on successful project us brought little cautious us in really it slowed really for CapEx

great. And really not labor end finding talked a the I the Okay, just you really about at environment you important ramping talking but here still a the the about lastly, like about I management business in business ask market Michael, healthy there a talent? we’re I – that’s and just and well? Because that want in What’s for and new from seeing as recession, about up. perspective maybe of management know know bit much. were pipeline bringing – an to a talent up that’s scale are as you good aspect as is

be helpful? there thoughts So any would

than because were is, more Yes. thing recruiting they had paradigms the a a The offices, of going come near home. We’ve lot there can Yes. office already do know need work We We don’t day. that we continue greatest it’s recruiting from the but rich that today our doubling, know want in every gone. we of department. day live because single they our to be every office environment somebody in doubling yesterday people are to to to the that

our time yes, office, some to need and product need target don’t opens don’t for all marketing very together in design at very, in some environment up first together office. like rich BAMKO design, need to strong. pretty be business us That all, the of teams collaborate Where time and development their need people people but is all. our who, they a And they there in uniform reputation the or and at

the or side out suppliers, us. comes out the office and the anywhere BAMKO, it of of uniform apparel promotional management, out that like want those talent lot business, proven of best companies can their They promotional of with great be BAMKO, India be the business of the or Salvador. in we business, them the would the Florida, project despite for If people years Texas. in work business, for have the China to world. And very of different quite as in the Cattell So are model if be us. supply lot wherever somebody can El can quite have for opportunities be a That find work over Seminole, is don’t they in I’m distributors somebody even a we while or anywhere out live to goes in the comes happy of like They U.S. even anywhere. they come candidates and may for can to the frankly, anywhere What be looking frankly, locally, we don’t us. have those

of a it’s people, long. employed very now. target, think usually we aren’t Great are a right lot So people unemployed

we’re go we’re an when actively great to we they’re so pitching our going there lot out in to people. And But and to company. awful them and recruit sell we think have out got

great years Thanks. in And business. in XXXX a a results and on congratulations your on environment XXX congratulations Okay. such of difficult also

be expected we based million quarter, we at we’ve XXXX and about the so clarify giving knew business. everybody Yes. was thoughts we $XXX thing, when nothing already what Kevin, to third Michael were I guidance one our on that base we guidance really PPE that point, just had having orders the that to the understands want do In about changed. of given in

mentioned the to of he are not when $XXX did contemplated acquisition changed, about we nothing million had significant business that number. with the Michael forward. part clarify I to As continuing fairly we And By go Design, PPE book a that that earlier, had want as said that Gifts into we was something

of be the So organic then that rates that what across within growth the comparable to of added we’ve would business. would rest form but it the to be got going forward, number,

Okay.

that So the on Design. sizeable layering just is By roughly? million $XXX is Gifts and How still base

rate $X.X about per run million It’s month.

plus Okay. the the the And Design. we’re $XXX Gifts By still using floor, million as

Okay.

Gifts Plus that mean, we point. about as contemplating what knew book we We’re additional PPE it. I plus Design at By

demand going the and to crisis how the for really so we last. long can’t pandemic that gauge PPE is And

realistic give wanted added to basis we all that So it. to that’s a and without

it. All right. Got Okay. Thanks.

you much. Okay. Thank All right. very

have And Instructions] [Operator no it further like questions. looks we

back now would turn conference for I session. remarks. question-and-answer to any Benstock our like over Michael the concludes to closing this So

operating today. great for you we all QX. in always with us See then. you report reporting great forward We you to joining results. to It’s be thank hope look strong and results Well,

presentation. concluded. now Thank conference The is today’s you attending for

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