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Letter To Shareholders 

To Our Shareholders

Alpha Pro Tech made significant strides in 2016 to improve profitability and our competitive positioning. Consolidated sales for 2016 of $46.2 million were up compared to 2015 sales due to growth in our Building Supply and Infection Control segments. Net income tripled in 2016, which was the direct result of operational improvements, decreasing overall expenses and our continued focus on reducing product costs, which all had a resoundingly positive impact. We successfully navigated industry-wide, competitive pricing pressures, particularly in our Building Supply segment, to increase our sales volumes while driving down costs.

Our balance sheet remained strong, with cash on hand of approximately $9.5 million, a current ratio of 12:1 and zero debt at December 31, 2016. Strong cash flow generation, combined with the strength of our balance sheet, provided us with financial flexibility and the resources to continue our open market repurchases of our common stock. In 2016, we repurchased 2,453,900 shares at a cost of $6.8 million, bringing the repurchase program total to 14,971,531 shares since its inception. All stock is retired upon repurchase. With approximately $2.5 million available for additional stock repurchases at the end of 2016 under our current authorization, we plan to remain active in the repurchase market during 2017.

We enter 2017 in a strong financial position and with expectations for improved profitability as we continue to execute our strategic objectives, launch new products and optimize our balance sheet. All of our capital allocation decisions are made with an eye towards future growth potential and long-term value creation for our shareholders. We look forward to a successful 2017 and communicating our accomplishments as we build on the Alpha Pro Tech brand and continue to develop, manufacture and market innovative, high-value products for the protection of people, products and environments. We thank you for your continued support.




 Alexander W. Millar
 Chairman & President


 Lloyd Hoffman
 Chief Executive Officer