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ARLINGTON, TX, January 20, 2004 — Tandy Brands Accessories, Inc. (Nasdaq NM:TBAC) today announced financial results for second quarter ended December 31, 2003.

For the second quarter of fiscal 2004, net sales totaled $64.2 million compared to $66.2 million for the same period last year. Net income for the second quarter of fiscal 2004 increased to $3.9 million, or $0.61 per diluted share, compared to net income of $3.6 million, or $0.60 per diluted share for the same period last year.

For the six months ended December 31, 2003, net sales rose to $128.4 million compared to $126.3 million for the same period in the prior year. Net income for the six-month period increased to $6.7 million, or $1.07 per diluted share, compared to net income of $5.4 million, or $0.91 per diluted share for the same six-month period last year. Net income results for the six months of fiscal 2003 included a non-cash charge, net of income taxes, related to adoption of Statement of Financial Accounting Standards No. 142 totaling $581,000, or $0.10 per diluted share.

J.S.B. Jenkins, president and chief executive officer, commented, “Although net sales were lower than expected, our net income results for the December quarter met expectations and surpassed last year’s results. This net income performance was driven by lower than planned selling, general and administrative expenses primarily as a result of lower advertising and a bad debt recovery of approximately $651,000 arising from a customer’s bankruptcy court settlement on accounts receivable previously reserved for by the company.”

“The decrease in sales experienced in the December quarter compared to the prior year was a result of a weak retail environment and lower fashion trend accessory sales. We anticipate these sales challenges to continue into the March quarter decreasing net sales. Therefore, our March quarterly loss per share should be within a range of a $0.02 loss to breakeven, compared to earnings of $0.17 per diluted share for the same quarter last year. Our replenishment and fashion trend based sales should return to historical levels during our June quarter. We anticipate

earnings for the June quarter to be in the range of $0.10 to $0.12 per diluted share, compared to $0.11 per diluted share last year.”

Mr. Jenkins concluded, “I am pleased to report that we will pay on January 22, 2004, our second quarterly dividend of $0.025 per share to shareholders as of December 31, 2003. I am also pleased with our balance sheet improvements during the December quarter. We experienced significant decreases in accounts receivable of $12.5 million and increases in cash of $11.3 million compared to the September quarter. This cash generation during the December quarter lowered our net debt position below our original expectations and we expect to continue generating cash during the remainder of the fiscal year.”

Investors and interested parties will have the opportunity to listen to management’s discussion of Tandy Brands’ second quarter results in a conference call to be held today, Tuesday, January 20, 2004, at 10:00 a.m. ET. The dial-in number for the call is (888) 417-2317. For those who are unable to listen to the live broadcast, an audio replay of the call will be available through Tuesday, January 27, 2004, and can be accessed by dialing (877) 519-4471, passcode #4426752. A live webcast of the conference call will also be broadcast on www.viavid.net/detailpage.aspx?sid=00001908.

Tandy Brands Accessories, Inc. designs, manufactures and markets fashion accessories for men, women and children. Key product categories include belts, wallets, handbags, suspenders, socks, scarves, sporting goods, and cold weather and hair accessories. Merchandise is sold under various national brand names as well as private labels to all major levels of retail distribution, including the ROLFS e-commerce web site at www.rolfs.net.

Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the Company’s actual results in future periods to differ materially from forecasted or expected results. Those risks include, among other things, the competitive environment in the industry in general and in the Company’s specific market areas, inflation, changes in costs of goods and services and economic conditions in general and in the Company’s specific market area. Those and other risks are more fully described in the Company’s filings with the Securities and Exchange Commission.

TANDY BRANDS ACCESSORIES, INC.
Condensed Consolidated Statements of Income
(In thousands, except per share amounts)
(Unaudited)


		Three Months Ended						Six Months Ended
		December 31,						December 31,

		2003			2002			2003			2002

Net sales		$	64,159		$	66,222		$	128,391		$	126,250
Cost of goods sold			42,078			42,993			84,680			82,236

	Gross margin		22,081			23,229			43,711			44,014

Selling, general and administrative expenses			14,055			15,456			29,265			30,527
Depreciation and amortization			1,020			1,078			2,058			2,158

	Total operating expenses		15,075			16,534			31,323			32,685

Operating income			7,006			6,695			12,388			11,329
Interest expense			(677	)		(805	)		(1,370	)		(1,518	)
Royalty, interest and other income			29			45			31			46

Income before provision for income taxes and cumulative effect of accounting change			6,358			5,935			11,049			9,857
Provision for income taxes			2,449			2,308			4,295			3,835

Net income before cumulative effect of accounting change			3,909			3,627			6,754			6,022
Cumulative effect of accounting change for SFAS No. 142, net of income taxes			—			—			—			(581	)

Net income		$	3,909		$	3,627		$	6,754		$	5,441

Earnings per common share:
	Before accounting change	$	0.63		$	0.61		$	1.10		$	1.02
	Cumulative effect of accounting change		0.00			0.00			0.00			(0.10	)

		$	0.63		$	0.61		$	1.10		$	0.92

Earnings per common share-assuming dilution:
	Before accounting change	$	0.61		$	0.60		$	1.07		$	1.01
	Cumulative effect of accounting change		0.00			0.00			0.00			(0.10	)

		$	0.61		$	0.60		$	1.07		$	0.91

Dividends declared per share		$	0.025		$	0.00		$	0.05		$	0.00

Common shares outstanding			6,207			5,929			6,157			5,908

Common shares outstanding shares-assuming dilution			6,399			6,019			6,336			5,995

TANDY BRANDS ACCESSORIES, INC.
Condensed Consolidated Balance Sheets
(In thousands)


			December 31,			June 30,
			2003			2003

ASSETS			(Unaudited)			(Unaudited)
Current assets:
	Cash and cash equivalents		$	14,025		$	3,814
	Accounts receivable, net			40,805			41,672
	Inventories			57,123			62,156
	Deferred income taxes			4,623			4,757
	Other current assets			1,685			1,250

		Total current assets		118,261			113,649

Property, plant and equipment, at cost:
	Property and equipment, at cost			33,175			31,885
	Accumulated depreciation			(18,666	)		(17,261	)

		Net property, plant and equipment		14,509			14,624

Goodwill, net of accumulated amortization				11,699			11,641
Other intangibles, less amortization				4,715			4,900
Other noncurrent assets				1,353			1,716

		TOTAL ASSETS	$	150,537		$	146,530

LIABILITIES & STOCKHOLDERS’ EQUITY
Current liabilities:
	Accounts payable		$	9,937		$	14,522
	Accrued expenses			9,484			9,996

		Total current liabilities		19,421			24,518

	Notes payable			30,000			30,000
	Deferred income taxes			1,863			1,776
	Other noncurrent liabilities			302			182

		Total liabilities		51,586			56,476

Stockholders’ equity:
	Common stock			6,218			6,019
	Additional paid-in capital			25,608			23,802
	Cumulative other comprehensive income and unearned compensation on restricted stock			(749	)		(1,196	)
	Retained earnings			67,874			61,429

		Total stockholders’ equity		98,951			90,054

		TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY	$	150,537		$	146,530


Tandy Brands Accessories, Inc. J.S.B. Jenkins President/Chief Executive Officer (817) 548-0090 britt_jenkins@tandybrands.com		Investor Relations: Integrated Corporate Relations Brian Yarbrough (310) 395-6780 Media Relations: Monarch Communications, Inc. Jeff Siegel (516) 569-6144