Date of report (Date of earliest event reported:)
|
August 6, 2015
|
Tandy Leather Factory, Inc.
|
(Exact Name of Registrant as Specified in Its Charter)
|
Delaware
|
(State or Other Jurisdiction of Incorporation
|
1-12368
|
75-2543540
|
|
(Commission File Number)
|
(IRS Employer Identification Number)
|
1900 Southeast Loop 820, Fort Worth, Texas
|
76140
|
|
(Address of Principal Executive Offices)
|
(Zip Code)
|
(817) 872-3200
|
(Registrant’s Telephone Number, Including Area Code)
|
(Former Name or Former Address, if Changed Since Last Report)
|
(a)
|
Financial statements of businesses acquired.
|
(b)
|
Pro forma financial information.
|
(c)
|
Exhibits.
|
TANDY LEATHER FACTORY, INC.
|
|
Date: August 6, 2015
|
By: /s/ Jon Thompson
|
Jon Thompson, Chief Executive Officer and President
|
|
Contact:
|
Shannon L. Greene, Tandy Leather Factory, Inc.
|
(817) 872-3200 or shannon.greene@tandyleather.com
|
Mark Gilbert, Magellan Fin, LLC
|
(317) 867-2839 or MGilbert@MagellanFin.com
|
Quarter Ended 06/30/15
|
Quarter Ended 06/30/14
|
||||||
Sales
|
Operating
Income
|
Sales
|
Operating
Income
|
||||
Wholesale Leathercraft
|
$6,394,278
|
$968,552
|
$6,457,467
|
$1,106,942
|
|||
Retail Leathercraft
|
112,532,411
|
1,336,669
|
12,201,624
|
1,427,913
|
|||
International Leathercraft
|
846,839
|
28,621
|
1,044,516
|
121,422
|
|||
Total Operations
|
$19,773,528
|
$2,333,842
|
$19,703,607
|
$2,656,277
|
Six Months Ended 06/30/15
|
Six Months Ended 06/30/14
|
||||||
Sales
|
Operating
Income
|
Sales
|
Operating
Income
|
||||
Wholesale Leathercraft
|
$13,119,582
|
$1,920,407
|
$13,281,435
|
$2,479,579
|
|||
Retail Leathercraft
|
25,641,824
|
2,740,121
|
24,157,978
|
2,900,616
|
|||
International Leathercraft
|
1,800,886
|
62,195
|
2,102,660
|
242,745
|
|||
Total Operations
|
$40,562,292
|
$4,722,723
|
$39,542,073
|
$5,622,940
|
Wholesale Leathercraft
|
Quarter Ended 06/30/15
|
Quarter Ended 06/30/14
|
|||
# of stores
|
Sales
|
# of stores
|
Sales
|
||
Same store sales
|
28
|
$6,394,278
|
28
|
$6,333,373
|
|
Closed store sales
|
-
|
-
|
1
|
118,291
|
|
National account group
|
n/a
|
-
|
n/a
|
5,803
|
|
Total Sales – Wholesale Leathercraft
|
28
|
$6,394,278
|
29
|
$6,457,467
|
Wholesale Leathercraft
|
Six Months Ended 06/30/15
|
Six Months Ended 06/30/14
|
|||
# of stores
|
Sales
|
# of stores
|
Sales
|
||
Same store sales
|
28
|
$13,119,582
|
28
|
$12,686,904
|
|
Closed store sales
|
-
|
-
|
1
|
245,881
|
|
National account group
|
n/a
|
-
|
n/a
|
348,650
|
|
Total Sales – Wholesale Leathercraft
|
28
|
$13,119,582
|
29
|
$13,281,435
|
Retail Leathercraft
|
Quarter Ended 06/30/15
|
Quarter Ended 06/30/14
|
|||
# of stores
|
Sales
|
# of stores
|
Sales
|
||
Same store sales
|
80
|
$12,336,098
|
80
|
$12,201,624
|
|
New store sales
|
2
|
196,313
|
-
|
-
|
|
Total Sales – Retail Leathercraft
|
82
|
$12,532,411
|
80
|
$12,201,624
|
Retail Leathercraft
|
Six Months Ended 06/30/15
|
Six Months Ended 06/30/14
|
|||
# of stores
|
Sales
|
# of stores
|
Sales
|
||
Same store sales
|
79
|
$25,047,620
|
79
|
$24,037,433
|
|
New store sales
|
3
|
594,204
|
1
|
120,545
|
|
Total Sales – Retail Leathercraft
|
82
|
$25,641,824
|
80
|
$24,157,978
|
International Leathercraft
|
Quarter Ended 06/30/15
|
Quarter Ended 06/30/14
|
|||
# of stores
|
Sales
|
# of stores
|
Sales
|
||
Same store sales
|
3
|
$846,839
|
3
|
$1,044,516
|
|
New store sales
|
-
|
-
|
-
|
-
|
|
Total Sales – Intl Leathercraft
|
3
|
$846,839
|
3
|
$1,044,516
|
International Leathercraft
|
Six Months Ended 06/30/15
|
Six Months Ended 06/30/14
|
|||
# of stores
|
Sales
|
# of stores
|
Sales
|
||
Same store sales
|
3
|
$1,800,886
|
3
|
$2,102,660
|
|
New store sales
|
-
|
-
|
-
|
-
|
|
Total Sales – Intl Leathercraft
|
3
|
$1,800,886
|
3
|
$2,102,660
|
June 30,
2015
(unaudited)
|
December 31,
2014
(audited)
|
||||||
ASSETS
|
|||||||
CURRENT ASSETS:
|
|||||||
Cash
|
$10,867,362
|
$10,636,530
|
|||||
Accounts receivable-trade, net of allowance for doubtful accounts
|
|||||||
of $2,060 and $395 in 2015 and 2014, respectively
|
758,894
|
625,054
|
|||||
Inventory
|
32,810,251
|
32,875,492
|
|||||
Prepaid income taxes
|
623,815
|
336,828
|
|||||
Deferred income taxes
|
312,943
|
371,491
|
|||||
Prepaid expenses
|
1,347,391
|
1,348,652
|
|||||
Other current assets
|
121,055
|
157,758
|
|||||
Total current assets
|
46,841,711
|
46,351,805
|
|||||
PROPERTY AND EQUIPMENT, at cost
|
23,042,912
|
22,199,943
|
|||||
Less accumulated depreciation and amortization
|
(7,641,889)
|
(7,037,665)
|
|||||
15,401,023
|
15,162,278
|
||||||
GOODWILL
|
963,769
|
971,786
|
|||||
OTHER INTANGIBLES, net of accumulated amortization of approximately
|
|||||||
$686,000 and $665,000 in 2015 and 2014, respectively
|
35,470
|
58,026
|
|||||
OTHER assets
|
327,993
|
329,979
|
|||||
TOTAL ASSETS
|
$63,569,966
|
$62,873,874
|
|||||
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|||||||
CURRENT LIABILITIES:
|
|||||||
Accounts payable-trade
|
$1,679,012
|
$1,255,218
|
|||||
Accrued expenses and other liabilities
|
6,661,964
|
5,394,514
|
|||||
Current maturities of long-term debt
|
202,500
|
3,702,500
|
|||||
Total current liabilities
|
8,543,476
|
10,352,232
|
|||||
DEFERRED INCOME TAXES
|
1,408,192
|
1,458,005
|
|||||
LONG-TERM DEBT, net of current maturities
|
1,631,813
|
1,940,625
|
|||||
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;
|
|||||||
11,275,641 and 11,239,157 shares issued at 2015 and 2014, respectively;
|
|||||||
10,282,018 and 10,245,534 shares outstanding at 2015 and 2014, respectively
|
27,062
|
26,984
|
|||||
Paid-in capital
|
6,090,984
|
6,013,325
|
|||||
Retained earnings
|
49,617,132
|
46,664,829
|
|||||
Treasury stock at cost (993,623 shares at 2015 and 2014)
|
(2,894,068)
|
(2,894,068)
|
|||||
Accumulated other comprehensive income
|
(854,625)
|
(688,058)
|
|||||
Total stockholders’ equity
|
51,986,485
|
49,123,012
|
|||||
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY
|
$63,569,966
|
$62,873,874
|
THREE MONTHS
|
SIX MONTHS
|
||||||
2015
|
2014
|
2015
|
2014
|
||||
NET SALES
|
$19,773,528
|
$19,703,607
|
$40,562,292
|
$39,542,073
|
|||
COST OF SALES
|
6,959,147
|
6,924,001
|
15,164,983
|
14,046,744
|
|||
Gross profit
|
12,814,381
|
12,779,606
|
25,397,309
|
25,495,329
|
|||
OPERATING EXPENSES
|
10,480,539
|
10,123,329
|
20,674,586
|
19,872,389
|
|||
INCOME FROM OPERATIONS
|
2,333,842
|
2,656,277
|
4,722,723
|
5,622,940
|
|||
OTHER INCOME (EXPENSE):
|
|||||||
Interest expense
|
(34,762)
|
(44,855)
|
(78,925)
|
(90,683)
|
|||
Other, net
|
9,877
|
5,334
|
29,750
|
6,678
|
|||
Total other income (expense)
|
(24,885)
|
(39,521)
|
(49,175)
|
(84,005)
|
|||
INCOME BEFORE INCOME TAXES
|
2,308,957
|
2,616,756
|
4,673,548
|
5,538,935
|
|||
PROVISION FOR INCOME TAXES
|
801,061
|
851,271
|
1,721,245
|
1,919,038
|
|||
NET INCOME
|
$1,507,896
|
$1,765,485
|
$2,952,303
|
$3,619,897
|
|||
NET INCOME PER COMMON SHARE:
|
|||||||
Basic
|
$0.15
|
$0.17
|
$0.29
|
$0.35
|
|||
Diluted
|
$0.15
|
$0.17
|
$0.29
|
$0.35
|
|||
Weighted Average Number of Shares Outstanding:
|
|||||||
Basic
|
10,212,933
|
10,198,733
|
10,212,137
|
10,198,733
|
|||
Diluted
|
10,241,164
|
10,239,823
|
10,241,130
|
10,239,447
|
2015
|
2014
|
||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|||||||
Net income
|
$2,952,303
|
$3,619,897
|
|||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
|
|||||||
Depreciation and amortization
|
809,456
|
715,920
|
|||||
(Gain) loss on disposal or abandonment of assets
|
25,204
|
(1,409)
|
|||||
Non-cash stock-based compensation
|
77,737
|
29,065
|
|||||
Deferred income taxes
|
8,735
|
(143,413)
|
|||||
Foreign currency translation
|
(121,909)
|
84,854
|
|||||
Net changes in assets and liabilities:
|
|||||||
Accounts receivable-trade, net
|
(133,840)
|
(33,701)
|
|||||
Inventory
|
65,241
|
(9,700,760)
|
|||||
Prepaid expenses
|
1,261
|
331,773
|
|||||
Other current assets
|
36,703
|
128,361
|
|||||
Accounts payable-trade
|
423,794
|
171,275
|
|||||
Accrued expenses and other liabilities
|
1,267,450
|
888,235
|
|||||
Income taxes payable
|
(286,987)
|
(740,505)
|
|||||
Total adjustments
|
2,172,845
|
(8,270,305)
|
|||||
Net cash provided by (used in) operating activities
|
5,125,148
|
(4,650,408)
|
|||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|||||||
Purchase of property and equipment
|
(1,088,231)
|
(949,082)
|
|||||
Proceeds from sale of assets
|
741
|
18,736
|
|||||
Decrease (increase) in other assets
|
1,986
|
4,984
|
|||||
Net cash used in investing activities
|
(1,085,504)
|
(925,362)
|
|||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|||||||
Net increase in revolving credit loans
|
-
|
2,250,000
|
|||||
Payments on notes payable and long-term debt
|
(3,808,812)
|
(354,375)
|
|||||
Net cash provided by (used in) financing activities
|
(3,808,812)
|
1,895,625
|
|||||
NET CHANGE IN CASH
|
230,832
|
(3,680,145)
|
|||||
CASH, beginning of period
|
10,636,530
|
11,082,679
|
|||||
CASH, end of period
|
$10,867,362
|
$7,402,534
|
|||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
|
|||||||
Interest paid during the period
|
$78,925
|
$90,683
|
|||||
Income tax paid during the period, net of (refunds)
|
$2,003,680
|
$2,567,257
|
|||||
NON-CASH INVESTING ACTIVITIES:
|
|||||||
Accrued dividend
|
-
|
$2,549,684
|