![]() |
Delaware
|
75-2543540
|
(State or Other Jurisdiction of Incorporation or Organization)
|
(I.R.S. Employer Identification No.)
|
Class
|
Shares outstanding as of November 11, 2011
|
Common Stock, par value $0.0024 per share
|
10,156,442
|
September 30, 2011
(unaudited)
|
December 31, 2010
(audited)
|
||||||
ASSETS
|
|||||||
CURRENT ASSETS:
|
|||||||
Cash
|
$5,991,628
|
$4,293,746
|
|||||
Short-term investments, including certificates of deposit
|
336,000
|
1,621,593
|
|||||
Accounts receivable-trade, net of allowance for doubtful accounts
|
|||||||
of $85,000 and $147,000 in 2011 and 2010, respectively
|
1,539,229
|
1,253,639
|
|||||
Inventory
|
20,551,287
|
20,236,028
|
|||||
Prepaid income taxes
|
4,765
|
-
|
|||||
Deferred income taxes
|
293,351
|
307,509
|
|||||
Other current assets
|
1,450,867
|
1,056,201
|
|||||
Total current assets
|
30,167,127
|
28,768,716
|
|||||
PROPERTY AND EQUIPMENT, at cost
|
14,955,482
|
14,390,662
|
|||||
Less accumulated depreciation and amortization
|
(4,475,331)
|
(4,106,121)
|
|||||
10,480,151
|
10,284,541
|
||||||
GOODWILL
|
984,344
|
990,368
|
|||||
OTHER INTANGIBLES, net of accumulated amortization of
|
|||||||
$527,000 and $495,000 in 2011 and 2010, respectively
|
198,693
|
232,416
|
|||||
Other assets
|
342,169
|
319,533
|
|||||
$42,172,484
|
$40,595,574
|
||||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|||||||
CURRENT LIABILITIES:
|
|||||||
Accounts payable-trade
|
$1,844,920
|
$1,247,821
|
|||||
Accrued expenses and other liabilities
|
3,425,716
|
4,893,236
|
|||||
Income taxes payable
|
-
|
554,380
|
|||||
Current maturities of long-term debt
|
202,500
|
202,500
|
|||||
Total current liabilities
|
5,473,136
|
6,897,937
|
|||||
DEFERRED INCOME TAXES
|
892,311
|
628,543
|
|||||
LONG-TERM DEBT, net of current maturities
|
3,155,625
|
3,307,500
|
|||||
COMMITMENTS AND CONTINGENCIES
|
|||||||
STOCKHOLDERS' EQUITY:
|
|||||||
Preferred stock, $0.10 par value; 20,000,000 shares authorized;
|
|||||||
none issued or outstanding; attributes to be determined on issuance
|
-
|
-
|
|||||
Common stock, $0.0024 par value; 25,000,000 shares authorized;
|
|||||||
11,150,065 shares issued at 2011 and 2010;
|
|||||||
10,156,442 shares outstanding at 2011 and 2010
|
26,760
|
26,760
|
|||||
Paid-in capital
|
5,736,543
|
5,703,387
|
|||||
Retained earnings
|
29,485,373
|
26,429,335
|
|||||
Treasury stock at cost (993,623 shares at 2011 and 2010)
|
(2,894,068)
|
(2,894,068)
|
|||||
Accumulated other comprehensive income
|
296,804
|
496,180
|
|||||
Total stockholders' equity
|
32,651,412
|
29,761,594
|
|||||
$42,172,484
|
$40,595,574
|
THREE MONTHS
|
NINE MONTHS
|
||||||
2011
|
2010
|
2011
|
2010
|
||||
NET SALES
|
$15,385,421
|
$13,640,193
|
$47,198,382
|
$42,579,553
|
|||
COST OF SALES
|
6,147,143
|
5,457,668
|
18,590,002
|
16,705,466
|
|||
Gross profit
|
9,238,278
|
8,182,525
|
28,608,380
|
25,874,087
|
|||
OPERATING EXPENSES
|
8,016,441
|
7,106,669
|
23,704,740
|
21,817,552
|
|||
INCOME FROM CONTINUING OPERATIONS
|
1,221,837
|
1,075,856
|
4,903,640
|
4,056,535
|
|||
OTHER INCOME (EXPENSE):
|
|||||||
Interest expense
|
(61,550)
|
(67,565)
|
(185,685)
|
(198,784)
|
|||
Other, net
|
176,374
|
77,887
|
81,775
|
161,095
|
|||
Total other income (expense)
|
114,824
|
10,322
|
(103,910)
|
(37,689)
|
|||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES
|
1,336,661
|
1,086,178
|
4,799,730
|
4,018,846
|
|||
PROVISION FOR INCOME TAXES
|
506,187
|
493,532
|
1,742,324
|
1,417,513
|
|||
NET INCOME FROM CONTINUING OPERATIONS
|
830,474
|
592,646
|
3,057,406
|
2,601,333
|
|||
INCOME FROM DISCONTINUED OPERATIONS, NET OF TAX
|
(1,368)
|
1,259
|
(1,368)
|
1,795
|
|||
NET INCOME
|
$829,106
|
$593,905
|
$3,056,038
|
$2,603,128
|
|||
NET INCOME FROM CONTINUING OPERATIONS PER COMMON SHARE:
|
|||||||
Basic
|
$0.08
|
$0.06
|
$0.30
|
$0.26
|
|||
Diluted
|
$0.08
|
$0.06
|
$0.30
|
$0.25
|
|||
NET INCOME FROM DISCONTINUED OPERATIONS PER COMMON SHARE:
|
|||||||
Basic
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
|||
Diluted
|
$0.00
|
$0.00
|
$0.00
|
$0.00
|
|||
NET INCOME PER COMMON SHARE:
|
|||||||
Basic
|
$0.08
|
$0.06
|
$0.30
|
$0.26
|
|||
Diluted
|
$0.08
|
$0.06
|
$0.30
|
$0.25
|
|||
Weighted Average Number of Shares Outstanding:
|
|||||||
Basic
|
10,156,442
|
10,256,442
|
10,156,442
|
10,195,868
|
|||
Diluted
|
10,168,326
|
10,257,743
|
10,179,523
|
10,236,919
|
2011
|
2010
|
|||||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
||||||||||
Net income
|
$3,056,038
|
$2,603,128
|
||||||||
(Loss) income from discontinued operations
|
(1,368)
|
1,795
|
||||||||
3,057,406
|
2,601,333
|
|||||||||
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||||
Depreciation and amortization
|
759,279
|
713,366
|
||||||||
Loss on disposal or abandonment of assets
|
81,579
|
11,584
|
||||||||
Non-cash stock-based compensation
|
33,156
|
22,790
|
||||||||
Deferred income taxes
|
273,161
|
(59,006)
|
||||||||
Other
|
(178,795)
|
53,382
|
||||||||
Net changes in assets and liabilities, net of effect of business acquisitions:
|
||||||||||
Accounts receivable-trade, net
|
(285,590)
|
(246,414)
|
||||||||
Inventory
|
(315,259)
|
(3,957,677)
|
||||||||
Income taxes
|
(554,681)
|
(346,935)
|
||||||||
Other current assets
|
(394,666)
|
(1,756,160)
|
||||||||
Accounts payable-trade
|
597,099
|
1,382,177
|
||||||||
Accrued expenses and other liabilities
|
(1,467,520)
|
838,883
|
||||||||
Total adjustments
|
(1,452,237)
|
(3,344,010)
|
||||||||
Net cash provided by (used in) continuing operating activities
|
1,605,169
|
(742,677)
|
||||||||
Cash used in discontinued operations
|
(1,067)
|
(23,706)
|
||||||||
Net cash provided by (used in) operating activities
|
1,604,102
|
(766,383)
|
||||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
||||||||||
Purchase of property and equipment
|
(1,042,775)
|
(963,222)
|
||||||||
Purchase of certificates of deposit
|
-
|
(2,572,593)
|
||||||||
Proceeds from maturities of certificates of deposit
|
1,285,593
|
5,943,000
|
||||||||
Proceeds from sale of assets
|
25,473
|
6,560
|
||||||||
Increase in other assets
|
(22,636)
|
(5,522)
|
||||||||
Net cash provided by investing activities
|
245,655
|
2,408,223
|
||||||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
||||||||||
Payment of dividends
|
-
|
(7,690,832)
|
||||||||
Payments on notes payable and long-term debt
|
(151,875)
|
(151,875)
|
||||||||
Repurchase of common stock (treasury stock)
|
-
|
(8,419)
|
||||||||
Proceeds from issuance of common stock
|
-
|
170,266
|
||||||||
Net cash used in financing activities
|
(151,875)
|
(7,680,860)
|
||||||||
NET INCREASE (DECREASE) IN CASH
|
1,697,882
|
(6,039,020)
|
||||||||
CASH, beginning of period
|
4,293,746
|
7,891,962
|
||||||||
CASH, end of period
|
$5,991,628
|
$1,852,942
|
||||||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
|
||||||||||
Interest paid during the period
|
$185,685
|
$198,784
|
||||||||
Income tax paid during the period, net of (refunds)
|
1,940,659
|
1,808,619
|
Number of Shares
|
Par
Value
|
Paid-in Capital
|
Treasury
Stock
|
Retained Earnings
|
Accumulated Other Comprehensive
Income (Loss)
|
Total
|
Comprehensive
Income (Loss)
|
||||||||
BALANCE, December 31, 2009
|
10,130,628
|
$26,453
|
$5,491,736
|
$(2,452,649)
|
$29,959,910
|
$334,205
|
$33,359,655
|
||||||||
Shares issued - stock options
|
128,114
|
307
|
169,959
|
-
|
-
|
-
|
170,266
|
||||||||
Stock-based compensation
|
-
|
-
|
22,790
|
-
|
-
|
-
|
22,790
|
||||||||
Purchase of treasury stock
|
(2,300)
|
-
|
-
|
(8,419)
|
-
|
-
|
(8,419)
|
||||||||
Net income
|
-
|
-
|
-
|
-
|
2,603,128
|
-
|
2,603,128
|
$2,603,128
|
|||||||
Cash dividend
|
-
|
-
|
-
|
-
|
(7,690,832)
|
-
|
(7,690,832)
|
||||||||
Translation adjustment
|
-
|
-
|
-
|
-
|
-
|
57,132
|
57,132
|
57,132
|
|||||||
BALANCE, September 30, 2010
|
10,256,442
|
$26,760
|
$5,684,485
|
$(2,461,068)
|
$24,872,206
|
$391,337
|
$28,513,720
|
Comprehensive income for the nine months ended September 30, 2010
|
$2,660,260
|
Number of Shares
|
Par
Value
|
Paid-in Capital
|
Treasury
Stock
|
Retained Earnings
|
Accumulated Other Comprehensive
Income (Loss)
|
Total
|
Comprehensive
Income (Loss)
|
||||||||
BALANCE, December 31, 2010
|
10,156,442
|
$26,760
|
$5,703,387
|
$(2,894,068)
|
$26,429,335
|
$496,180
|
$29,761,594
|
||||||||
Stock-based compensation
|
-
|
-
|
33,156
|
-
|
-
|
-
|
33,156
|
||||||||
Net income
|
-
|
-
|
-
|
-
|
3,056,038
|
-
|
3,056,038
|
$3,056,038
|
|||||||
Translation adjustment
|
-
|
-
|
-
|
-
|
-
|
(199,376)
|
(199,376)
|
(199,376)
|
|||||||
BALANCE, September 30, 2011
|
10,156,442
|
$26,760
|
$5,736,543
|
$(2,894,068)
|
$29,485,373
|
$296,804
|
$32,651,412
|
Comprehensive income for the nine months ended September 30, 2011
|
$2,856,662
|
As of
|
|||
September 30, 2011
|
December 31, 2010
|
||
Inventory on hand:
|
|||
Finished goods held for sale
|
$19,519,688
|
$17,847,002
|
|
Raw materials and work in process
|
641,799
|
518,422
|
|
Inventory in transit
|
389,800
|
1,870,604
|
|
$20,551,287
|
$20,236,028
|
Leather Factory
|
Tandy Leather
|
Total
|
|
Balance, December 31, 2009
|
$600,417
|
$383,406
|
$983,823
|
Acquisitions and adjustments
|
-
|
-
|
-
|
Foreign exchange gain/loss
|
2,383
|
-
|
2,383
|
Impairments
|
-
|
-
|
-
|
Balance, September 30, 2010
|
$602,800
|
$383,406
|
$986,206
|
Leather Factory
|
Tandy Leather
|
Total
|
|
Balance, December 31, 2010
|
$606,962
|
$383,406
|
$990,368
|
Acquisitions and adjustments
|
-
|
-
|
-
|
Foreign exchange gain/loss
|
(6,024)
|
-
|
(6,024)
|
Impairments
|
-
|
-
|
-
|
Balance, September 30, 2011
|
$600,938
|
$383,406
|
$984,344
|
As of September 30, 2011
|
As of December 31, 2010
|
||||||
Gross
|
Accumulated
Amortization
|
Net
|
Gross
|
Accumulated
Amortization
|
Net
|
||
Trademarks, Copyrights
|
$544,369
|
$417,011
|
$127,358
|
$544,369
|
$391,531
|
$152,838
|
|
Non-Compete Agreements
|
181,755
|
110,420
|
71,335
|
183,134
|
103,556
|
79,578
|
|
$726,124
|
$527,431
|
$198,693
|
$727,503
|
$495,087
|
$232,416
|
Wholesale Leathercraft
|
Retail Leathercraft
|
Total
|
|
2011
|
$13,826
|
$31,337
|
$45,163
|
2012
|
5,614
|
33,337
|
38,951
|
2013
|
-
|
33,337
|
33,337
|
2014
|
-
|
33,337
|
33,337
|
2015
|
-
|
28,635
|
28,635
|
September 30, 2011
|
December 31, 2010
|
||
Credit Agreement with JPMorgan Chase Bank – collateralized by real estate; payable as follows:
|
|||
Line of Credit Note dated July 31, 2007, converted to a 10-year term note on April 30, 2008; $16,875 monthly principal payments plus interest at 7.1% per annum; matures April 30, 2018
|
$ 3,358,125
|
$3,510,000
|
|
Less - Current maturities
|
(202,500)
|
(202,500)
|
|
$3,155,625
|
$3,307,500
|
Weighted Average Exercise Price
|
# of shares
|
Weighted Average Remaining Contractual Term (in years)
|
Aggregate Intrinsic Value
|
||
Outstanding, January 1, 2010
|
$2.33
|
197,700
|
|||
Granted
|
5.078
|
12,000
|
|||
Cancelled
|
-
|
-
|
|||
Exercised
|
1.647
|
136,700
|
|||
Outstanding, September 30, 2010
|
$4.34
|
73,000
|
4.21
|
$154,275
|
|
Exercisable, September 30, 2010
|
$4.19
|
61,000
|
3.13
|
$131,485
|
|
Outstanding, January 1, 2011
|
$4.35
|
103,600
|
|||
Granted
|
4.80
|
12,000
|
|||
Cancelled
|
-
|
-
|
|||
Exercised
|
-
|
-
|
|||
Outstanding, September 30, 2011
|
$4.40
|
115,600
|
5.40
|
$206,332
|
|
Exercisable, September 30, 2011
|
$4.40
|
115,600
|
5.40
|
$206,332
|
September 30, 2011
|
September 30, 2010
|
|
Weighted average grant-date fair value of stock options granted
|
$1.19
|
$1.90
|
Total fair value of stock options vested
|
$52,057
|
22,790
|
Total intrinsic value of stock options exercised
|
N/A
|
$114,603
|
|
Three Months Ended
|
Nine Months Ended
|
||||||||
September 30,
|
September 30,
|
|||||||||
2011
|
2010
|
2011
|
2010
|
|||||||
Numerator:
|
||||||||||
Net income
|
$829,106
|
$593,905
|
$3,056,038
|
$2,603,128
|
||||||
Numerator for basic and diluted earnings per share
|
829,106
|
593,905
|
3,056,038
|
2,603,128
|
||||||
Denominator:
|
||||||||||
Weighted-average shares outstanding-basic
|
10,156,442
|
10,256,442
|
10,156,442
|
10,195,868
|
||||||
Effect of dilutive securities:
|
||||||||||
Stock options
|
11,884
|
1,301
|
23,081
|
41,051
|
||||||
Dilutive potential common shares
|
11,884
|
1,301
|
23,081
|
41,051
|
||||||
Denominator for diluted earnings per share-weighted-average shares
|
10,168,326
|
10,257,743
|
10,179,523
|
10,236,919
|
||||||
Basic earnings per share
|
$0.08
|
$0.06
|
$0.30
|
$0.26
|
||||||
Diluted earnings per share
|
$0.08
|
$0.06
|
$0.30
|
$0.25
|
a.
|
Wholesale Leathercraft, which consists of a chain of wholesale stores operating under the name, The Leather Factory, located in North America;
|
b.
|
Retail Leathercraft, which consists of a chain of retail stores operating under the name, Tandy Leather Company, located in the North America; and
|
c.
|
International Leathercraft, which sells to both wholesale and retail customers. It carries the same products as North American stores. As of September 30, 2011, this operation consisted of one store located in Northampton, UK. A second store was opened in October 2011 in Sydney, Australia.
|
Wholesale Leathercraft
|
Retail Leathercraft
|
Int’l Leathercraft
|
Discontinued Operations
|
Total
|
||
For the quarter ended September 30, 2011
|
||||||
Net sales
|
$6,150,138
|
$8,744,446
|
$490,837
|
$15,385,421
|
||
Gross profit
|
3,733,345
|
5,178,788
|
326,145
|
9,238,278
|
||
Operating earnings
|
296,824
|
811,347
|
113,666
|
1,221,837
|
||
Interest (expense)
|
(61,550)
|
-
|
-
|
(61,550)
|
||
Other income (expense), net
|
175,715
|
(1,577)
|
2,236
|
176,374
|
||
Income before income taxes
|
410,989
|
809,770
|
115,902
|
1,336,661
|
||
Depreciation and amortization
|
216,958
|
42,836
|
2,134
|
261,928
|
||
Fixed asset additions
|
239,477
|
114,200
|
191,613
|
545,290
|
||
Total assets
|
$32,903,869
|
$7,225,267
|
$2,043,348
|
-
|
$42,172,484
|
|
For the quarter ended September 30, 2010
|
||||||
Net sales
|
$6,012,932
|
$7,212,443
|
$414,818
|
$13,640,193
|
||
Gross profit
|
3,699,403
|
4,238,791
|
244,331
|
8,182,525
|
||
Operating earnings
|
510,256
|
518,718
|
46,882
|
1,075,856
|
||
Interest (expense)
|
(67,565)
|
-
|
-
|
(67,565)
|
||
Other income (expense), net
|
60,634
|
(356)
|
17,609
|
77,887
|
||
Income before income taxes
|
503,325
|
518,362
|
64,491
|
1,086,178
|
||
Depreciation and amortization
|
204,097
|
33,294
|
4,565
|
241,956
|
||
Fixed asset additions
|
205,409
|
22,985
|
-
|
228,394
|
||
Total assets
|
$33,282,964
|
$6,328,371
|
$532,685
|
-
|
$40,144,020
|
Wholesale Leathercraft
|
Retail Leathercraft
|
Int’l Leathercraft
|
Discontinued Operations
|
Total
|
|
For the nine months ended September 30, 2011
|
|||||
Net sales
|
$19,341,919
|
$26,327,904
|
$1,528,559
|
$47,198,382
|
|
Gross profit
|
11,781,622
|
15,829,914
|
996,844
|
28,608,380
|
|
Operating earnings
|
1,709,226
|
2,857,986
|
336,428
|
4,903,640
|
|
Interest (expense)
|
(185,685)
|
-
|
-
|
(185,685)
|
|
Other income (expense), net
|
69,968
|
(7,613)
|
19,420
|
81,775
|
|
Income before income taxes
|
1,593,509
|
2,850,373
|
355,848
|
4,799,730
|
|
Depreciation and amortization
|
636,050
|
115,597
|
7,632
|
759,279
|
|
Fixed asset additions
|
520,805
|
328,857
|
193,113
|
1,042,775
|
|
Total assets
|
$32,903,869
|
$7,225,267
|
$2,043,348
|
-
|
$42,172,484
|
For the nine months ended September 30, 2010
|
|||||
Net sales
|
$18,849,015
|
$22,535,418
|
$1,195,120
|
$42,579,553
|
|
Gross profit
|
11,491,749
|
13,649,194
|
733,144
|
25,874,087
|
|
Operating earnings
|
1,667,718
|
2,210,932
|
177,885
|
4,056,535
|
|
Interest expense
|
(198,784)
|
-
|
-
|
(198,784)
|
|
Other income (expense), net
|
157,590
|
(880)
|
4,385
|
161,095
|
|
Income before income taxes
|
1,626,524
|
2,210,052
|
182,270
|
4,018,846
|
|
Depreciation and amortization
|
603,712
|
98,329
|
11,325
|
713,366
|
|
Fixed asset additions
|
902,858
|
60,364
|
-
|
963,222
|
|
Total assets
|
$33,282,964
|
$6,328,371
|
$532,685
|
-
|
$40,144,020
|
Three months ended September 30,
|
2011
|
2010
|
United States
|
$13,078,107
|
$11,681,130
|
Canada
|
1,560,808
|
1,300,564
|
All other countries
|
746,506
|
658,499
|
$15,385,421
|
$13,640,193
|
Nine months ended September 30,
|
2011
|
2010
|
United States
|
$40,056,351
|
$36,865,020
|
Canada
|
4,832,078
|
4,022,287
|
All other countries
|
2,309,953
|
1,692,246
|
$47,198,382
|
$42,579,553
|
Ø
|
Our business may be negatively impacted by general economic conditions and the current global financial crisis.
|
Ø
|
Our profitability may decline as a result of increasing pressure on margins.
|
Ø
|
We may be unsuccessful in implementing our planned international expansion, which could impair the value of our brand, harm our business and negatively affect our results of operation.
|
Quarter Ended September 30, 2011
|
Quarter Ended September 30, 2010
|
||||||
Sales
|
Operating Income
|
Sales
|
Operating Income
|
||||
Wholesale Leathercraft
|
$6,150,138
|
$296,824
|
$6,012,932
|
$510,256
|
|||
Retail Leathercraft
|
8,744,446
|
811,347
|
7,212,443
|
518,718
|
|||
Int’l Leathercraft
|
490,837
|
113,666
|
414,818
|
46,882
|
|||
Total Operations
|
$15,385,421
|
$1,221,837
|
$13,640,193
|
$1,075,856
|
2011
|
2010
|
% change
|
||
Net income
|
$829,106
|
$593,905
|
39.6%
|
Quarter Ended
|
|||
Customer Group
|
09/30/11
|
09/30/10
|
|
RETAIL (end users, consumers, individuals)
|
28%
|
25%
|
|
INSTITUTION (prisons, prisoners, hospitals, schools, youth organizations, etc.)
|
5%
|
6%
|
|
WHOLESALE (resellers & distributors, saddle & tack shops, authorized dealers, etc.)
|
44%
|
43%
|
|
MANUFACTURERS
|
7%
|
9%
|
|
NATIONAL ACCOUNTS
|
16%
|
17%
|
|
100%
|
100%
|
# of Stores
|
Quarter Ended 09/30/11
|
Quarter Ended 09/30/10
|
$ Change
|
% Change
|
|||
Same store sales
|
29
|
$5,361,239
|
$5,091,250
|
$269,989
|
5.3%
|
||
Closed store
|
1
|
-
|
102,063
|
(102,063)
|
N/A
|
||
National account group
|
788,899
|
819,619
|
(30,720)
|
(3.7)%
|
|||
Total sales
|
$6,150,138
|
$6,012,932
|
$137,206
|
2.3%
|
# Stores
|
Quarter Ended 09/30/11
|
Quarter Ended 09/30/10
|
$ Change
|
% Change
|
|||
Same store sales
|
76
|
$8,678,135
|
$7,212,443
|
$1,465,692
|
20.3%
|
||
New store sales
|
1
|
66,311
|
-
|
66,311
|
N/A
|
||
Total sales
|
$8,744,446
|
$7,212,443
|
$1,532,003
|
21.2%
|
Quarter Ended
|
|||
Customer Group
|
09/30/11
|
09/30/10
|
|
RETAIL (end users, consumers, individuals)
|
59%
|
63%
|
|
INSTITUTION (prisons, prisoners, hospitals, schools, youth organizations, etc.)
|
5%
|
4%
|
|
WHOLESALE (resellers & distributors, saddle & tack shops, authorized dealers, etc.)
|
33%
|
32%
|
|
NATIONAL ACCOUNTS
|
-
|
-
|
|
MANUFACTURERS
|
3%
|
1%
|
|
100%
|
100%
|
Nine Months Ended September 30, 2011
|
Nine Months Ended September 30, 2010
|
||||||
Sales
|
Operating Income
|
Sales
|
Operating Income
|
||||
Wholesale Leathercraft
|
$19,341,919
|
$1,709,226
|
$18,849,015
|
$1,667,718
|
|||
Retail Leathercraft
|
26,327,904
|
2,857,986
|
22,535,418
|
2,210,932
|
|||
International Leathercraft
|
1,528,559
|
336,428
|
1,195,120
|
177,885
|
|||
Total Operations
|
$47,198,382
|
$4,903,640
|
$42,579,553
|
$4,056,535
|
2011
|
2010
|
% change
|
||
Net income
|
$3,056,038
|
$2,603,128
|
17.4%
|
# Stores
|
Nine Months Ended 09/30/11
|
Nine Months Ended 09/30/10
|
$ Change
|
% Change
|
|||
Same store sales
|
29
|
$17,133,069
|
$16,270,557
|
$862,512
|
5.3%
|
||
Closed store
|
1
|
-
|
274,162
|
(274,162)
|
N/A
|
||
National account group
|
2,208,850
|
2,304,296
|
(95,446)
|
(0.4)%
|
|||
Total sales
|
$19,341,919
|
$18,849,015
|
$492,904
|
2.6%
|
Nine Months Ended
|
|||
Customer Group
|
09/30/11
|
09/30/10
|
|
RETAIL (end users, consumers, individuals)
|
31%
|
28%
|
|
INSTITUTION (prisons, prisoners, hospitals, schools, youth organizations, etc.)
|
6%
|
7%
|
|
WHOLESALE (resellers & distributors, saddle & tack shops, authorized dealers, etc.)
|
44%
|
42%
|
|
MANUFACTURERS
|
7%
|
8%
|
|
NATIONAL ACCOUNTS
|
12%
|
15%
|
|
100%
|
100%
|
# of Stores
|
Nine Months Ended 09/30/11
|
Nine Months Ended 09/30/10
|
$ Change
|
% Change
|
|
Same (existing) store sales
|
75
|
$26,013,673
|
$22,391,758
|
$3,621,915
|
16.2%
|
New store sales
|
2
|
314,231
|
143,660
|
170,571
|
118.7%
|
Total sales
|
$26,327,904
|
$22,535,418
|
$3,792,486
|
16.8%
|
Nine Months Ended
|
|||
Customer Group
|
09/30/11
|
09/30/10
|
|
RETAIL (end users, consumers, individuals)
|
60%
|
63%
|
|
INSTITUTION (prisons, prisoners, hospitals, schools, youth organizations, etc.)
|
6%
|
6%
|
|
WHOLESALE (resellers & distributors, saddle & tack shops, authorized dealers, etc.)
|
31%
|
30%
|
|
NATIONAL ACCOUNTS
|
-
|
-
|
|
MANUFACTURERS
|
3%
|
1%
|
|
100%
|
100%
|
Exhibit
Number
|
Description
|
|
3.1
|
Certificate of Incorporation of The Leather Factory, Inc., and Certificate of Amendment to Certificate of Incorporation of The Leather Factory, Inc. filed as Exhibit 3.1 to Form 10-Q filed by Tandy Leather Factory, Inc. with the Securities and Exchange Commission on August 12, 2005 and incorporated by reference herein.
|
|
3.2
|
Bylaws of The Leather Factory, Inc., filed as Exhibit 3.5 to the Current Report on Form 8-K (Commission File No. 001-12368) filed by Tandy Leather Factory, Inc (f/k/a The Leather Factory, Inc.) with the Securities and Exchange Commission on July 14, 2004 and incorporated by reference herein.
|
|
*31.1
|
13a-14(a) or 15d-14(a) Certification by Jon Thompson, Chief Executive Officer and President.
|
|
*31.2
|
13a-14(a) or 15d-14(a) Certification by Shannon Greene, Chief Financial Officer and Treasurer.
|
|
*32.1
|
Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101.INS^
|
XBRL Instance Document.
|
|
101.SCH^
|
XBRL Taxonomy Extension Schema Document.
|
|
101.CAL^
|
XBRL Taxonomy Extension Calculation Document.
|
|
101.DEF^
|
XBRL Taxonomy Extension Definition Document.
|
|
101.LAB^
|
XBRL Taxonomy Extension Labels Document.
|
|
101.PRE^
|
XBRL Taxonomy Extension Presentation Document.
|
|
____________
|
||
*Filed herewith.
|
TANDY LEATHER FACTORY, INC.
|
|
(Registrant)
|
|
Date: November 14, 2011
|
By: /s/ Jon Thompson
|
Jon Thompson
|
|
Chief Executive Officer and President
|
|
Date: November 14, 2011
|
By: /s/ Shannon L. Greene
|
Shannon L. Greene
|
|
Chief Financial Officer and Treasurer (Chief Accounting Officer)
|
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
d.
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.
|
Date: November 14, 2011
|
|
/s/ Jon Thompson
|
|
Jon Thompson
|
|
Chief Executive Officer and President
|
|
(principal executive officer)
|
a.
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d.
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's third fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.
|
Date: November 14, 2011
|
|
/s/ Shannon L. Greene
|
|
Shannon L. Greene
|
|
Treasurer and Chief Financial Officer
|
|
(principal accounting officer)
|
i.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
ii.
|
The information contained in the Report fully presents, in all material respects, the financial condition and results of operations of the Company as of the dates and for the periods expressed in the Report.
|
November 14, 2011
|
By: /s/ Jon Thompson
|
Jon Thompson
|
|
Chief Executive Officer and President
|
|
November 14, 2011
|
By: /s/ Shannon L. Greene
|
Shannon L. Greene
|
|
Chief Financial Officer and Treasurer
|
Consolidated Balance Sheets(Unaudited) (Parentheticals) (USD $) | Sep. 30, 2011 | Dec. 31, 2010 |
---|---|---|
Accounts receivable-trade, net allowance for doubtful accounts (in Dollars) | $ 85,000 | $ 147,000 |
OTHER INTANGIBLES, net of accumulated amortization (in Dollars) | $ 527,000 | $ 495,000 |
Preferred stock par value (in Dollars per share) | $ 0 | $ 0 |
Preferred stock, shares authorized | 20,000,000 | 20,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, shares outstanding | 0 | 0 |
Common stock, par value (in Dollars per share) | $ 0.0024 | $ 0.0024 |
Common stock, shares authorized | 25,000,000 | 25,000,000 |
Common stock, shares issued | 11,150,065 | 11,150,065 |
Common stock, shares outstanding | 10,156,442 | 10,156,442 |
Treasury stock shares | 993,623 | 993,623 |
Consolidated Statements of Income(Unaudited) (USD $) | 3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2011 | Sep. 30, 2010 | Sep. 30, 2011 | Sep. 30, 2010 | |
NET SALES | $ 15,385,421 | $ 13,640,193 | $ 47,198,382 | $ 42,579,553 |
COST OF SALES | 6,147,143 | 5,457,668 | 18,590,002 | 16,705,466 |
Gross profit | 9,238,278 | 8,182,525 | 28,608,380 | 25,874,087 |
OPERATING EXPENSES | 8,016,441 | 7,106,669 | 23,704,740 | 21,817,552 |
INCOME FROM CONTINUING OPERATIONS | 1,221,837 | 1,075,856 | 4,903,640 | 4,056,535 |
OTHER INCOME (EXPENSE): | ||||
Interest expense | (61,550) | (67,565) | (185,685) | (198,784) |
Other, net | 176,374 | 77,887 | 81,775 | 161,095 |
Total other income (expense) | 114,824 | 10,322 | (103,910) | (37,689) |
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 1,336,661 | 1,086,178 | 4,799,730 | 4,018,846 |
PROVISION FOR INCOME TAXES | 506,187 | 493,532 | 1,742,324 | 1,417,513 |
NET INCOME FROM CONTINUING OPERATIONS | 830,474 | 592,646 | 3,057,406 | 2,601,333 |
INCOME FROM DISCONTINUED OPERATIONS, NET OF TAX | (1,368) | 1,259 | (1,368) | 1,795 |
NET INCOME | $ 829,106 | $ 593,905 | $ 3,056,038 | $ 2,603,128 |
NET INCOME FROM CONTINUING OPERATIONS PER COMMON SHARE: | ||||
Basic (in Dollars per share) | $ 0.08 | $ 0.06 | $ 0.30 | $ 0.26 |
Diluted (in Dollars per share) | $ 0.08 | $ 0.06 | $ 0.30 | $ 0.25 |
NET INCOME FROM DISCONTINUED OPERATIONS PER COMMON SHARE: | ||||
Basic (in Dollars per share) | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 |
Diluted (in Dollars per share) | $ 0.00 | $ 0.00 | $ 0.00 | $ 0.00 |
NET INCOME PER COMMON SHARE: | ||||
Basic (in Dollars per share) | $ 0.08 | $ 0.06 | $ 0.30 | $ 0.26 |
Diluted (in Dollars per share) | $ 0.08 | $ 0.06 | $ 0.30 | $ 0.25 |
Weighted Average Number of Shares Outstanding: | ||||
Basic (in Shares) | 10,156,442 | 10,256,442 | 10,156,442 | 10,195,868 |
Diluted (in Shares) | 10,168,326 | 10,257,743 | 10,179,523 | 10,236,919 |
Document And Entity Information | 9 Months Ended | |
---|---|---|
Sep. 30, 2011 | Nov. 11, 2011 | |
Document and Entity Information [Abstract] | ||
Entity Registrant Name | TANDY LEATHER FACTORY INC | |
Document Type | 10-Q | |
Current Fiscal Year End Date | --12-31 | |
Entity Common Stock, Shares Outstanding | 10,156,442 | |
Amendment Flag | false | |
Entity Central Index Key | 0000909724 | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Filer Category | Non-accelerated Filer | |
Entity Well-known Seasoned Issuer | No | |
Document Period End Date | Sep. 30, 2011 | |
Document Fiscal Year Focus | 2011 | |
Document Fiscal Period Focus | Q3 |
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Note 6 - Cash Dividend | 9 Months Ended |
---|---|
Sep. 30, 2011 | |
Cash Dividend [Text Block] |
6. CASH
DIVIDEND
In
May 2010, our Board of Directors authorized a $0.75 per share
special one-time cash dividend that was paid to stockholders
of record at the close of business on June 3, 2010. We
released the funds used to pay for the special one-time cash
dividend on July 1, 2010 and the dividend, totaling $7.7
million, was paid to stockholders on July 5, 2010. Our Board
will determine future cash dividends after giving
consideration to our then existing levels of profit and cash
flow, capital requirements, current and forecasted liquidity,
as well as financial and other business conditions existing
at the time.
|
Note 2 - Short-Term Investments | 9 Months Ended |
---|---|
Sep. 30, 2011 | |
Available-for-sale Securities [Table Text Block] |
2. SHORT-TERM
INVESTMENTS
All
current fixed maturity securities are classified as
“available for sale” and are reported at carrying
value, which approximates fair value based on the discounted
value of contractual cash flows. We have determined that our
investment securities are available to support current
operations and, accordingly, have classified such securities
as current assets without regard to contractual
maturities. Investments at September 30, 2011 and
December 31, 2010 consisted of certificates of
deposit. The contractual maturities of $336,000 in
certificates of deposit held as of September 30, 2011 are all
due within one year.
We
measure fair value as an exit price, which is the amount that
would be received to sell an asset or paid to transfer a
liability in an orderly transaction between market
participants. As a basis for considering such
assumptions, accounting standards establish a three-tier
value hierarchy, which prioritizes the inputs used in the
valuation methodologies in measuring fair value:
Level
1 – observable inputs that reflect quoted prices
(unadjusted) for identical assets or liabilities in active
markets.
Level
2 – include other inputs that are directly or
indirectly observable in the marketplace.
Level
3 – unobservable inputs which are supported by little
or no market activity.
Classification
of the financial asset or liability within the hierarchy is
determined based on the lowest level input that is
significant to the fair value measurement. We
classify our certificates of deposit as level 2 assets and
have maintained consistency in valuation techniques during
the period ended September 30, 2011.
|
Note 8 - Litigation | 9 Months Ended |
---|---|
Sep. 30, 2011 | |
Legal Matters and Contingencies [Text Block] |
8. LITIGATION
On
March 16, 2011, two former employees of the Company filed a
lawsuit, entitled Mark Barnes and
Jerry Mercante on behalf of themselves and all other
similarly situated v. Tandy Leather Company, Inc., Tandy
Leather Factory, and Does 1-50, in the US District
Court for the District of Nevada. The lawsuit was
subsequently amended on May 9, 2011 to add another former
employee, Donna Cavota, as a third named
plaintiff. The suit alleges that the Company
violated requirements of the Fair Labor Standards Act (FLSA)
as well as various state wage laws. Plaintiffs
seek to represent themselves and all similarly situated U.S.
current and former store managers of the
Company. Plaintiffs seek reimbursement for
an unspecified amount of unpaid overtime compensation,
liquidated damages, attorney’s fees and
costs. On May 17, 2011, the district court in
Nevada granted the Company’s request to transfer venue
to the Northern District of Texas. Trial is
currently set for the week of May 29, 2012. It is
not possible at this time to predict whether the Company will
incur any liability, or to estimate the ranges of damages, if
any, which may be incurred in connection with the matter. The
company intends to vigorously defend the lawsuit.
|
Note 9 - Store Closing | 9 Months Ended |
---|---|
Sep. 30, 2011 | |
Disposal Groups, Including Discontinued Operations, Disclosure [Text Block] |
9. STORE
CLOSING
On
October 15, 2010, we announced the closing of Mid-Continent
Leather Sales, a wholesale store located in Coweta, Oklahoma,
due to its unsatisfactory sales and earnings
performance. All related one-time expenses
associated with the store closing were expensed in 2010 as
part of operating expenses. The store closing did
not result in an impairment of goodwill.
|
Note 7 - Segment Information | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2011 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting Disclosure [Text Block] |
7. SEGMENT
INFORMATION
We
identify our segments based on the activities of three
distinct operations:
Our
reportable operating segments have been determined as
separately identifiable business units, and we measure
segment earnings as operating earnings, defined as income
before interest and income taxes.
Net
sales for geographic areas were as follows for the three and
nine months ended September 30, 2011 and 2010:
Geographic
sales information is based on the location of the
customer. No single foreign country, except for
Canada, accounted for any material amount of our consolidated
net sales for the three or nine-month periods ended September
30, 2011 and 2010. We do not have any significant
long-lived assets outside of the United States.
|
Consolidated Statements of Stockholders' Equity (Unaudited) (USD $) | Common Stock [Member] | Additional Paid-in Capital [Member] | Treasury Stock [Member] | Retained Earnings, Unappropriated [Member] | Accumulated Other Comprehensive Income (Loss) [Member] | Comprehensive Income [Member] | Total |
---|---|---|---|---|---|---|---|
BALANCE, at Dec. 31, 2009 | $ 26,453 | $ 5,491,736 | $ (2,452,649) | $ 29,959,910 | $ 334,205 | $ 33,359,655 | |
BALANCE, (in Shares) at Dec. 31, 2009 | 10,130,628 | ||||||
Shares issued - stock options | 307 | 169,959 | 170,266 | ||||
Shares issued - stock options (in Shares) | 128,114 | ||||||
Stock-based compensation | 22,790 | 22,790 | |||||
Purchase of treasury stock | (8,419) | (8,419) | |||||
Purchase of treasury stock (in Shares) | (2,300) | ||||||
Net income | 2,603,128 | 2,603,128 | 2,603,128 | ||||
Cash dividend | (7,690,832) | (7,690,832) | |||||
Translation adjustment | 57,132 | 57,132 | 57,132 | ||||
Comprehensive income for the six months | 2,660,260 | ||||||
BALANCE, at Sep. 30, 2010 | 26,760 | 5,684,485 | (2,461,068) | 24,872,206 | 391,337 | 28,513,720 | |
BALANCE, (in Shares) at Sep. 30, 2010 | 10,256,442 | ||||||
BALANCE, at Dec. 31, 2010 | 26,760 | (2,894,068) | |||||
BALANCE, (in Shares) at Dec. 31, 2010 | 10,156,442 | ||||||
Comprehensive income for the six months | 2,856,662 | ||||||
BALANCE, at Jun. 30, 2011 | |||||||
BALANCE, at Dec. 31, 2010 | 26,760 | 5,703,387 | (2,894,068) | 26,429,335 | 496,180 | 29,761,594 | |
BALANCE, (in Shares) at Dec. 31, 2010 | 10,156,442 | 10,156,442 | |||||
Stock-based compensation | 33,156 | 33,156 | |||||
Net income | 3,056,038 | 3,056,038 | 3,056,038 | ||||
Translation adjustment | (199,376) | (199,376) | (199,376) | ||||
BALANCE, at Sep. 30, 2011 | $ 32,651,412 | ||||||
BALANCE, (in Shares) at Sep. 30, 2011 | 10,156,442 |
Note 3 - Notes Payable and Long-term Debit | 9 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2011 | ||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Text Block] |
3. NOTES
PAYABLE AND LONG-TERM DEBT
On
July 31, 2007, we entered into a Credit Agreement and Line of
Credit Note with JPMorgan Chase Bank, N.A., pursuant to which
the bank agreed to provide us with a credit facility of up to
$5,500,000 to facilitate our purchase of real estate
consisting of a 195,000 square foot building situated on 30
acres of land located at 1900 SE Loop 820 in Fort Worth,
Texas. Proceeds in the amount of $4,050,000 were
used to fund the purchase of the property. On
April 30, 2008, the principal balance was rolled into a
10-year term note with a 20-year amortization that accrues
interest at a rate of 7.10% per annum.
At
September 30, 2011 and December 31, 2010, the amount
outstanding under the above agreements consisted of the
following:
|
Note 4 - Stock-Based Compensation | 6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2011 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Disclosure of Compensation Related Costs, Share-based Payments [Text Block] |
4. STOCK-BASED
COMPENSATION
We
have one stock option plan which provides for annual stock
option grants to non-employee directors with an exercise
price equal to the fair market value of the shares at the
date of grant. Under this plan, 12,000 options
were awarded to directors for each of the nine month periods
ended September 30, 2011 and 2010. These options
vest and become exercisable six months from the option grant
date. We had two other stock option plans from
1995 which provided for stock option grants to officers, key
employees and non-employee directors. These plans
expired in 2005. The expiration of the plans has
no effect on the options previously
granted. Options outstanding and exercisable were
granted at a stock option price which was not less than the
fair market value of our common stock as of closing on the
date the option was granted and no option has a term in
excess of ten years. We recognized share based
compensation expense of $7,126 and $4,402 for each of the
quarters ended September 30, 2011 and 2010, respectively, and
$33,156 and $22,790 for each of the nine month periods ended
September 30, 2011 and 2010, respectively, as a component of
operating expenses.
During
the nine months ended September 30, 2011 and 2010, the stock
option activity under our stock option plans was as
follows:
Other
information pertaining to option activity during the
nine-month periods ended September 30, 2011 and 2010 are as
follows:
As
of September 30, 2011 and 2010, there was no unrecognized
compensation cost related to non-vested stock options.
|
Note 5 - Earnings per Share | 9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2011 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Text Block] |
5. EARNINGS
PER SHARE
The
following table sets forth the computation of basic and
diluted earnings per share (“EPS”) for the three
and nine months ended September 30, 2011 and 2010:
The
net effect of converting stock options and warrants to
purchase 102,600 and 10,000 shares of common stock at
exercise prices less than the average market prices has been
included in the computations of diluted EPS for the quarter
ended September 30, 2011 and 2010, respectively.
|
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