Company: APT
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001437749-25-033545
Chunk: 37

Company: ALPHA PRO TECH LTD
Filing Date: 2025-11-06
Form: 10-Q
Item: Part I, Item 2
Chunk 37
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% for the three months ended September 30, 2025, compared to 38.5% for the three months ended September 30, 2024.

Gross profit decreased by $352,000, or 2.0%, to $17,391,000 for the nine months ended September 30, 2025, from $17,743,000 for the nine months ended September 30, 2024. The gross profit margin was 38.4% for the nine months ended September 30, 2025, compared to 40.3% for the nine months ended September 30, 2024.

The gross profit margin in the nine months ended September 30, 2025 was negatively affected by a margin decrease primarily in the Disposable Protective Apparel segment and lesser degree in the Building Supply segment. Gross profit margin has been negatively affected in 2025, primarily by increased US tariffs, higher sales rebates and ocean freight rates.

Management expects that tariffs will have a negative effect on gross profit in the fourth quarter of 2025, as we have experienced three tariff increases on many of our products. There was a 10% baseline tariff on goods shipped from our joint venture partner after April 5th, a reciprocal tariff of an additional 15% on goods shipped after August 1st and an additional 25% on goods shipped after August 27. Management has increased selling prices in July 2025 and is expected to do so again in November, to partially mitigate the impact of the first two tariffs increases. There have been some positive developments of late regarding tariffs and management is hopeful that some of the tariff increases may be rolled back.

Selling, General and Administrative Expenses. Selling, general and administrative expenses increased by $66,000, or 1.5%, to $4,568,000 for the three months ended September 30, 2025, from $4,502,000 for the three months ended September 30, 2024. As a percentage of net sales, selling, general and administrative expenses decreased to 30.9% for the three months ended September 30, 2025, from 31.6% for the same period of 2024.

The change in expenses by segment for the three months ended September 30, 2025, was as follows: Building Supply expenses were up by $59,000, or 3.4%; Disposable Protective Apparel expenses were up by $45,000, or