Palm Beach Gardens, Florida--(Newsfile Corp. - May 27, 2026) - Robert G. Brown ("Mr. Brown"), founder, former Chairman and Chief Executive Officer, former director, and a significant shareholder of SPAR Group, Inc. (NASDAQ: SGRP) (hereinafter referred to as "SPAR Group" or the "Company"), today issued the following recommendations that the Company's Board of Directors (the "Board") implement to increase shareholder value:
"SPAR Group shareholders need assurance that their stock will not be diluted at depressed prices. The Company should focus on protecting existing shareholders by the following actions:
- building free cash flow;
- requesting bids for the Company's merchandising business;
- completing a spin-off and merger strategy;
- focus on an Artificial Intelligence ("AI")-focused retail software strategy;
- eliminating Nasdaq deficiency notices;
- authorizing a stock buyback; and
- adopting a dividend policy tied to free cash flow.
For 2025, SPAR reported $136.1 million in revenue,1 $21.7 million in gross profit,2 $32.2 million in selling, general and administrative expense,3 a net loss attributable to SPAR Group of $24.6 million4 and net cash used in operating activities of approximately $18.4 million.5 As of March 31, 2026, SPAR reported cash and cash equivalents of approximately $4.31 million,6 a secured revolving credit facility with a $36.0 million total facility for the U.S. and Canada, approximately $22.9 million total outstanding under the facility, and approximately $11.4 million of unused availability.7
I recommend:
- Authorize a 6,000,000-Share Repurchase Program over Three Years.
At current trading levels below $1.50 per share,8 repurchasing stock is one of the clearest ways to demonstrate confidence in the Company and protect shareholder value. - Direct Lincoln International to Solicit Bids for the U.S. and Canadian Merchandising Business.
SPAR Group has retained Lincoln International LLC ("Lincoln International")9 and should direct Lincoln International to solicit bids from buyers for the Company's merchandising business.
A buyer can make substantial savings by eliminating duplicative public company costs, field management costs, board fees, corporate overhead, administrative expenses, and other overlapping functions. Those savings can increase the value of the merchandising business to a buyer.
At a minimum, the Company's shareholders should know what credible buyers are willing to pay. - Pursue a Spin-Off and Merger Plan for the Merchandising Business.
The Board should pursue a spin-off and merger of the Company's merchandising business with one or more companies in related fields.
This transaction structure can provide non-public companies with an opportunity to monetize their investment through a public-company transaction. - Adopt a Dividend Resolution Tied to Free Cash Flow.
Subject to applicable legal, contractual, and other restrictions, SPAR Group should pay a quarterly dividend of $0.01 per share once projected free cash flow reaches at least $500,000 per quarter.
At the current volume of issued and outstanding shares, a $0.01 quarterly dividend would cost approximately $251,000 per quarter. The remaining cash would remain available to the Company. - A Prohibition on Issuing Common Stock at a Price below $1.00 Per Share.
This is essential to reassure shareholders that their ownership will not be diluted.
Issuing stock below $1.00 per share would directly damage shareholder value by diluting existing owners, reducing each existing shareholder's percentage ownership, and transferring future upside to new investors.
Dilution is the opposite of creating shareholder value when stock is issued at depressed prices. - Make AI and Retail Software the Central Strategic Focus.
The Board should make AI-generated software and retail technology a strategic direction. SPAR Group should investigate acquiring, merging with, or investing in, a company developing AI-focused retail software. The Company should look for a cashless merger, non-cash strategic investment, or partnership with a company that has an impactful AI-focused retail product.
Moving SPAR Group back toward technology and software can help move the Company away from low-gross-margin, low-multiple business lines, and toward higher-margin, higher-multiple retail AI technology opportunities. - Focus on Short-Term Free-Cash-Flow Improvement Targets.
Revenue growth that does not convert into cash flow should not be treated as success. The Board should prioritize cash generation and shareholder value. - Use these Actions to Cure Nasdaq Deficiency Notices.
A plan that includes a no-dilution, share repurchases, a sale bid process run by Lincoln International, a spin-off and merger of the merchandising business, a free-cash-flow dividend, short-term free-cash-flow improvements, and an AI and retail software strategy would send a clear message to Nasdaq and the market.
Nasdaq compliance is not just a technical issue. It is directly tied to shareholder confidence, market value, investor perception, and the Board's willingness to protect shareholders.
Summary
SPAR Group's Board should act to implement a plan to increase shareholder value, including:
- a share repurchase authorization for up to 6 million shares over three years;
- a directive to Lincoln International to solicit bids for the U.S. and Canadian merchandising business;
- a spin-off and merger plan for the merchandising business involving non-public companies in related fields;
- a $0.01 quarterly dividend resolution, subject to any restrictions under law or other agreements and constraints, once projected free cash flow reaches $500,000 per quarter;
- commitment to not issuing common stock at a price below $1.00 per share;
- a strategic focus on AI retail software;
- short-term free-cash-flow focus; and
- a plan to cure Nasdaq deficiency notices."
About Robert G. Brown
Robert G. Brown is a founder, former Chairman and Chief Executive Officer, former director, and significant shareholder of SPAR Group, Inc.
For questions regarding the matters set forth above, please contact Robert Brown via email at rbrown6@msn.com.
Forward-Looking Statement Note
This Press Release contains forward-looking statements with respect to SPAR Group and potential future actions. Statements that are not historical facts, including statements regarding Mr. Brown's views concerning the Company's strategic direction, operational performance, governance, management, capital allocation, valuation, strategic alternatives, potential transactions, or opportunities to enhance shareholder value, are forward-looking statements.
Forward-looking statements are based on Mr. Brown's current beliefs, expectations, estimates, and assumptions and involve known and unknown risks and uncertainties that could cause actual results or outcomes to differ materially from those expressed or implied by such statements. These risks and uncertainties include, among others, changes in market conditions, the Company's financial performance and strategic decisions, regulatory and legal developments, actions taken by the Company or other shareholders, the availability and terms of financing, macroeconomic conditions, and other factors beyond Mr. Brown's control.
No assurance can be given that any proposals, discussions, initiatives, objectives, or potential transactions referenced in this press release will be pursued, consummated, or achieve any particular outcome. Mr. Brown reserves the right to change his views, intentions, plans, or proposals at any time and disclaims any obligation to publicly update any forward-looking statements, except as required by law.
They are for information purposes only and should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation to buy, sell or hold any securities.
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1 SPAR Grp., Inc., Annual Report (Form 10-K) 15 (Mar. 31, 2026).
2 Id. at 29.
3 Id. at 15.
4 Id.
5 Id. at 29.
6 SPAR Grp., Inc., Quarterly Report (Form 10-Q) 2 (May. 12, 2026).
7 SPAR Grp., Inc., Quarterly Report (Form 10-Q) 9 (May. 12, 2026).
8 SPAR Group, Inc. (SGRP) Stock Price, News, Quotes & History, Yahoo! Finance, https://finance.yahoo.com/quote/SGRP/ (last visited May 26, 2026).
9 SPAR Grp., Inc. Annual Report (Form 8-K) (Sept. 8, 2022).
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Source: Robert G. Brown
