Top 40 distributor BAMKO (asi/131431) reported a 2.1% rise in year-over-year sales growth but almost a 4% drop in pretax earnings during the second quarter of 2024, according to a financial report released on Tuesday, August 6.

Sales for the distributor, headquartered in Los Angeles, were up to nearly $81.3 million in Q2, compared to $79.6 million during Q2 last year. Earnings before interest, taxes, depreciation and amortization (EBITDA) dropped slightly to $6.7 million from last year’s almost $7 million.

According to BAMKO President Jake Himelstein, a member of Counselor’s annual Power 50 list of promo’s most influential people, the firm’s sales growth is attributable to increased order numbers. However, more of those orders were smaller or for lower-value products.

“The good news is that customers haven’t stopped buying,” Himelstein said. “They are, however, being more prudent with their spend in large part due to uncertain economic conditions and the upcoming U.S. elections.”

The Q2 EBITDA drop is a slight anomaly for BAMKO, considering that the firm managed to increase its annual EBITDA last year despite an annual year-over-year sales drop of 12%. However, combining Q1 and Q2, net sales for the first half of 2024 were up 4.3%.

EBITDA for the year is up 15% – growth which Himelstein says is “attributable to gross margin expansion driven by a combination of improved supply chain costs and pricing.”

The net sales growth for the company slightly surpassed the industry average for Q2 but did fall short of matching growth within its category of extra-large distributors, or those with more than $5 million in yearly sales.

ASI Research’s Distributor Quarterly Sales Survey reported a 1.3% increase for year-over-year sales in Q2 for distributors collectively, an increase that came after the industry’s first reported distributor sales drop in almost three years during Q1. Extra-large distributors reported a 4.1% revenue increase on average in Q2, compared with BAMKO’s 2% growth.

BAMKO’s Q2 sales numbers were reported as part of the quarterly financial filing from its Florida-based parent company, Superior Group of Companies (SGC). Collectively, the company’s three business segments – BAMKO’s branded products, as well as healthcare apparel and contact centers – experienced a net sales increase of about 2% year over year this quarter to $131.7 million.

But net income for SGC was down just over 50% from last year’s Q2, dipping to $0.6 million, or $0.04 per diluted share, from last year’s reported $1.2 million, or $0.08 per diluted share.

“While second quarter results were below our expectations, we are poised to generate stronger performance in the second half of the year and are maintaining our full-year outlook,” said Michael Benstock, CEO of SGC.

BAMKO ranked eighth on Counselor’s 2024 Top 40 Distributors list, which ranks the largest distributors in the industry by reported 2023 North American promotional product revenue. The firm reported $342.7 million in sales last year.