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Note 2 - Operating Segment Information
 9 Months Ended
Sep. 30, 2025
Notes to Financial Statements  
Segment Reporting Disclosure [Text Block]

NOTE 2 – Operating Segment Information:

 

The Company manages and reports the following segments:

 

Branded Products segment: Primarily through our signature marketing brands BAMKO® and HPI®, we produce and sell customized merchandising solutions, promotional products and branded uniform programs. Branded products are sold to customers in a wide range of industries, including retail chain, food service, entertainment, technology, transportation and other industries. The segment currently has sales offices in the United States and Brazil, with support services in China and India.

 

Healthcare Apparel segment: Primarily through our portfolio of brands Wink®, Fashion Seal Healthcare®, its trade name CID Resources and our license of Carhartt Medical, 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. This segment sells its products to healthcare laundries, dealers, distributors and retailers primarily in the United States.

 

Contact Centers: Through multiple The Office Gurus® entities, including our subsidiaries in El Salvador, Belize, Dominican Republic, the United States and 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.

 

Intersegment eliminations include the elimination of revenues and costs from services provided by the Contact Centers segment to the Company’s two other segments. Such costs are recognized as selling and administrative expenses in the Branded Products and Healthcare Apparel segments. Income and expenses related to corporate functions that are not specifically attributable to an individual reportable segment are presented within Other in the table below.

 

The chief operating decision maker, who is the Company’s Chief Executive Officer, evaluates the performance of our segments. Segment EBITDA is the profitability metric reported to the Company’s CODM for purposes of making decisions about allocation of resources to, and assessing performance of, each reportable segment. Segment EBITDA is calculated as net sales less cost of goods sold and selling and administrative expenses. Segment information for total assets is not presented as this information is not used by the Company’s CODM in measuring segment performance or allocating resources between segments.

 

The following tables set forth financial information related to the Company’s operating segments (in thousands):

 

  Branded Products  Healthcare Apparel  Contact Centers  

Intersegment Eliminations

  

Other

  

Total

 

For the Three Months Ended September 30, 2025:

                        

Net sales

 $85,095  $31,520  $22,664  $(812) $-  $138,467 

Cost of goods sold

  55,466   19,394   10,669   (140)  -   85,389 

Gross margin

  29,629   12,126   11,995   (672)  -   53,078 

Selling and administrative expenses

  23,501   9,779   10,283   (672)  5,622   48,513 

Depreciation and amortization

  1,396   832   661   -   86   2,975 

Segment EBITDA

 $7,524  $3,179  $2,373  $-  $(5,536) $7,540 
                         
  Branded Products  Healthcare Apparel  Contact Centers  

Intersegment Eliminations

  

Other

  

Total

 

For the Three Months Ended September 30, 2024:

                        

Net sales

 $92,547  $33,025  $25,038  $(920) $-  $149,690 

Cost of goods sold

  59,037   19,216   11,296   (405)  -   89,144 

Gross margin

  33,510   13,809   13,742   (515)  -   60,546 

Selling and administrative expenses

  24,223   11,240   11,482   (515)  5,974   52,404 

Impairment charge

  -   260   -   -   -   260 

Depreciation and amortization

  1,446   944   770   -   92   3,252 

Segment EBITDA

 $10,733  $3,773  $3,030  $-  $(5,882) $11,654 

 

  Branded Products  Healthcare Apparel  Contact Centers  

Intersegment Eliminations

  

Other

  

Total

 

For the Nine Months Ended September 30, 2025:

                        

Net sales

 $264,216  $87,036  $70,866  $(2,509) $-  $419,609 

Cost of goods sold

  173,884   54,761   33,277   (1,158)  -   260,764 

Gross margin

  90,332   32,275   37,589   (1,351)  -   158,845 

Selling and administrative expenses

  72,353   29,383   32,816   (1,351)  17,654   150,855 

Depreciation and amortization

  4,271   2,598   2,022   -   266   9,157 

Segment EBITDA

 $22,250  $5,490  $6,795  $-  $(17,388) $17,147 
                         
  Branded Products  Healthcare Apparel  Contact Centers  

Intersegment Eliminations

  

Other

  

Total

 

For the Nine Months Ended September 30, 2024:

                        

Net sales

 $260,911  $88,854  $73,422  $(2,919) $-  $420,268 

Cost of goods sold

  167,534   53,335   34,075   (1,294)  -   253,650 

Gross margin

  93,377   35,519   39,347   (1,625)  -   166,618 

Selling and administrative expenses

  70,486   30,931   32,436   (1,625)  17,678   149,906 

Impairment charge

  -   260   -   -   -   260 

Depreciation and amortization

  4,513   2,837   2,246   -   276   9,872 

Segment EBITDA

 $27,404  $7,685  $9,157  $-  $(17,402) $26,844 

 

The following table reconciles income before income tax expense to Segment EBITDA (in thousands):

 

  

Three Months Ended September 30,

  

Nine Months Ended September 30,

 
  

2025

  

2024

  

2025

  

2024

 

Income before income tax expense

 $3,187  $6,573  $4,117  $11,815 

Interest expense

  1,378   1,569   3,873   4,897 

Depreciation and amortization

  2,975   3,252   9,157   9,872 

Impairment charge

  -   260   -   260 

Segment EBITDA

 $7,540  $11,654  $17,147  $26,844