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CORPORATE
PROFILE

Alpha Pro Tech, Ltd. (the Company) is in the business of protecting people, products and environments. The Company accomplishes this by being a leading designer, developer, manufacturer and marketer of high-value disposable protective apparel, building supply, infection control and other products for the medical, dental, cleanroom, pharmaceutical, industrial safety, construction supply and consumer markets.

The Company’s growth strategy is to provide innovative solutions to its customers and create meaningful value for its shareholders. Alpha Pro Tech has a reputation of combining extensive research and development with the highest levels of responsiveness, quality, safety and reliability.

Alpha Pro Tech’s manufacturing facilities and offices are located in Arizona, Georgia and Utah in the United States, as well as in Canada and India.

FINANCIAL HIGHLIGHTS

1 ANNUAL REPORT 2023
Lloyd Hoffman
President and
Chief Executive Officer

TO OUR
SHAREHOLDERS

Entering fiscal year 2024, Alpha Pro Tech is positioned strongly both operationally and financially, emanating from our success in 2023, which saw expanded production capacity and new product innovation. We also focused on driving operational cash flow, which efforts culminated in our cash position increasing by over 25%, to $20.4 million despite spending approximately $4 million to repurchase shares in 2023.

The strategic research and development investments to expand our product offerings and capital investments to increase production capacity have positioned the company for incremental growth in 2024 and beyond. The launch of our housewrap accessories line in 2022 saw a 180.5% increase in sales during 2023 and we continue to make inroads into the multi-family and commercial construction sector, evidenced by a 33.9% increase in premium housewrap sales in 2023. We also expanded our roofing products with the launch of our self-adhered product line in late 2023, which we expect to grow revenue within our current customer base and allow for expansion into new markets and business segments.

The company experienced the six highest revenue quarters on record for the Building Supply segment over the past eight quarters: the second, third, and fourth quarters of 2023 and the first, second and third quarters of 2022. These achievements come despite the continued softness in the housing market, as new U.S. housing starts in 2023 decreased by 8.8%, compared to 2022. Despite this decline, Building Supply segment sales for 2023 increased by $3.5 million, or 9.4%, to a record sales year of $40.4 million, compared to $36.9 million in 2022.
2 ANNUAL REPORT 2023
Overall, our consolidated sales for the year ended December 31, 2023, decreased to $61.2 million, from $62.0 for the year ended December 31, 2022, representing a decrease of $749,000, or 1.2%. This decrease consisted of decreased sales in the Disposable Protective Apparel segment of $4.2 million, partially offset by the $3.5 million increase in sales in the Building Supply segment. The Disposable Protective Apparel segment decrease was due to a 4.0% increase in sales of core disposable protective garments, offset by a 62.3% decrease in sales of face masks and a 75.5% decrease in sales of face shields.

Our balance sheet remains strong with cash of $20.4 million as of December 31, 2023, up 25.1% from the prior year, and working capital of over $50 million with no debt, continuing our strong financial position.

Our investments to scale capacity and launch new products, which both expands our breadth in current markets and opens up new market opportunities, positions the company to further drive shareholder value. This growth and expansion will be executed by our dedicated employees, which have been the backbone to our success.

In closing, I want to thank our shareholders for their continued support and trust in Alpha Pro Tech.


Sincerely,

Lloyd Hoffman
President and
Chief Executive Officer
3 ANNUAL REPORT 2023
  • Apparel,
    Masks
    & Shields
  • Alpha Pro Tech’s Disposable Protective Apparel segment manufactures a family of products featuring head-to-toe protective garments, single-use protective face masks and light-splash protective shields. Embedded within our face mask offering is a Made-in-the-USA, NIOSH approved N95 Respirator. Our entire portfolio is branded under our trademark ‘Critical Cover®’ and is manufactured for the express purpose of achieving total contamination control in clean rooms and controlled environments.

    The target markets in which we serve lie within the manufacturing environments of Pharma and Bio-Pharma, Medical Device, Electronics, Aerospace, and others. The physical properties of our garment materials are formulated in such a way to best-manage the potential contamination of the product or products which employees are either manufacturing or handling. Additionally, our Critical Cover® portfolio serves well in the general industrial marketplace where end-customers simply need to provide lightweight disposable garments to protect their workforce and / or visitors.

    Outside the clean room / controlled environment world, Alpha Pro Tech manufactures the aforementioned face masks and protective shields for use in the Dental and Medical marketplaces. We work with authorized channel partners along with other Healthcare Consortiums to demonstrate the unique designs and protective properties of these products. To that end, our Made-in-the-USA face masks feature an innovative and patented design called the Positive Facial Lock (PFL®). The PFL® advantage utilizes our exclusive Twist-Seal technology that allows the wearer to create a custom fit to their own facial features. When used properly, this unique advantage can prevent airborne contaminants from entering the wearer’s breathing zone. A second patented and integrated feature of our face masks, called the Magic Arch®, facilitates comfort and breathability. The Magic Arch® upholds the structure and design and prevents the face mask from coming in contact with the wearer’s nose and mouth. The PFL® and Magic Arch® structures work in concert to provide the wearer with a comfortable and effective device and an intangible sense of confidence in their safety.

    Across all parts of the Disposable Protective Apparel segment, we strive to pursue a strategy of working with authorized channel partners and select global, national, and regional distributors. We endeavor to build a strong sales, marketing, and operational rapport with all of our partners and distributors in an effort to achieve our mutual goals of organic sales growth and customer retention. Our sales and marketing strategy differentiates and protects the AlphaProTech Critical Cover® brand and delivers high-quality products and best-in-class customer service and support. We take extraordinary pride in “protecting people, products and environments”!
4 ANNUAL REPORT 2023
Alpha Pro Tech garments are available in a wide selection of materials and configurations to protect the wearer as needed.
5 ANNUAL REPORT 2023
  • Building
    Products
  • As the Building Supply Products segment approaches 20 years, we reflect on transitioning from humble beginnings to becoming a vertically integrated global manufacturer. Looking back at nearly two decades in the building industry, it is important to understand our history and vision for the future. Alpha Pro Tech entered the business with one synthetic roof underlayment and two housewrap/weather resistive barrier (WRB) products. With core values of protecting people, products and environments, it was important we produce the highest quality products with utmost social and environmental integrity. Over the years, we have expanded our synthetic roof underlayment category to include recyclable components that reduce dependency on asphalt-based alternatives and increase jobsite safety with highest in class tear resistance. Since our launch, the building industry has made great strides to increase efficiency in residential homes and commercial buildings. Our housewrap (WRB) line-up has evolved to become one of the most inclusive in the industry. In addition to first generation, woven style housewraps, we are proud to offer multiple non-woven options to fit nearly every climate condition and exterior cladding.

    COVID presented the building materials industry with many challenges; product availability was the most prevalent. Alpha Pro Tech responded with capital investments aimed at increasing capacity to supplement higher demand and complementary product development to offer system warranties for our housewrap/WRBs across residential and commercial applications. Today, these system warranties are being adopted in manufactured housing, multi-family residential, single-family residential and commercial projects. We are proud to be aligned with builders, contractors and specifiers aimed at constructing healthier working and living spaces.

    As a pioneer in the synthetic roof underlayment business, we proudly introduced two new products into this category in 2023. Historically, we have provided essential components for other products in the roofing industry. Now, utilizing our vast knowledge of this business and vertical integration, we also market TECHNOplus Ice & Water and REX Ultra HT under our brand. This expansion has and will continue to drive growth within our existing distribution partners and contractors. We are enthusiastic about the new markets and opportunities that will potentially open because of these new products.

    In addition to product development and capacity, we continually invest in people and programs to educate industry stakeholders. In 2022, we developed a training program for architects and specifiers. In 2023, we took it a step further by dedicating a team to drive this initiative as well as focus on the commercial and multi-family segment. As a result, we are developing relationships and tracking measurable results in this new business segment.

    Looking to the future, we are excited to build on our current portfolio to raise building and evaluation standards. We will maintain our position of responsibly sourcing and manufacturing the highest quality products in the market. We are committed to promoting our educational tools and training to ensure our partners can bring the very best products to market. At Alpha Pro Tech, We Have You Covered!
6 ANNUAL REPORT 2023
From single family to multi‑family developments, our system has you covered in every direction, from the walls to the roof.
7 ANNUAL REPORT 2023

CORPORATE
INFORMATION

MARKET FOR SHARES

The Company’s common shares are quoted on the NYSE American Exchange under the trading symbol “APT.”

As of April 15, 2024 there were 11,688,700 shares outstanding and 102 registered shareholders of Alpha Pro Tech, Ltd.

DIVIDEND POLICY

The holders of the Company’s common stock are entitled to receive such dividends as may be declared by the Board of Directors of the Company from time to time to the extent that funds are legally available for payment thereof. The Company has never declared or paid any dividends on any of its outstanding shares of common stock. It is the current policy of the Board of Directors to retain any earnings to provide for the development and growth of the Company. Consequently, the Company has no current intention to pay cash dividends in the foreseeable future.

TRANSFER AGENT AND REGISTRAR

Shareholders should refer specific questions concerning their stock certificates, in writing, directly to the Transfer Agent and Registrar at:
Equiniti Trust Company LLC
48 Wall Street, Floor 23
New York, NY 10005

INDEPENDENT REGISTERED PUBLIC
ACCOUNTING FIRM

Tanner LLC
3300 N. Triumph Blvd., Suite 410
Lehi, UT 84043

LEGAL COUNSEL

Maynard Nexsen PC
1901 6th Avenue N, Suite 1700
Birmingham, AL 35203

FORM 10-K

A copy of the Annual Report on Form 10-K filed by the Company with the Securities and Exchange Commission for the fiscal year ended December 31, 2023 is available upon request without charge to persons who are beneficial shareholders as of the record date for the 2024 Annual Meeting. Such written requests should be directed to:
Alpha Pro Tech, Ltd.
53 Wellington Street East
Aurora, Ontario L4G 1H6

OFFICERS AND DIRECTORS

Lloyd Hoffman

President and Chief Executive Officer and Director

Colleen McDonald

Chief Financial Officer

Danny Montgomery

Sr. V.P. Manufacturing and Director

Donna Millar

Investor Relations and Director

David Garcia

Director
Retired Independent Businessman

Dr. John Ritota

Director
Dentist – Ritota & Ritota P.A.

James W.A. Buchan

Director
Management – Bell Canada

Benjamin A. Shaw

Director
Sr. Director & Controller – Western Governors University

ANNUAL MEETING

The Annual Meeting of Shareholders will be held:
Wednesday, June 12, 2024 at 9:30 am
Microtel Inn & Suites
180 Goulding Avenue
Aurora, Ontario L4G 3Z2
365-809-4680
Corporate Head Office
53 Wellington Street East
Aurora, Ontario
L4G 1H6
Phone: 800 847-9725
Fax: 905 479-9732
Email: ir@alphaprotech.com