Date of report (Date of earliest event reported:)
|
March 11, 2016
|
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: March 11, 2016
|
By: /s/ Shannon L. Greene
|
Shannon L. Greene, Chief Financial Officer and Treasurer
|
|
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@mageellanfin.com
|
Quarter Ended 12/31/15
|
Quarter Ended 12/31/14
|
||||||
Sales
|
Oper Inc
|
Sales
|
Oper Inc
|
||||
Wholesale Leathercraft
|
$7,519,790
|
$2,060,722
|
$7,709,704
|
$1,720,505
|
|||
Retail Leathercraft
|
15,744,009
|
1,827,471
|
15,579,134
|
1,905,845
|
|||
International Leathercraft
|
979,172
|
4,033
|
1,182,767
|
151,812
|
|||
Total Operations
|
$24,242,971
|
$3,892,226
|
$24,471,605
|
$3,778,162
|
Year Ended 12/31/15
|
Year Ended 12/31/14
|
||||||
Sales
|
Oper Inc
|
Sales
|
Oper Inc
|
||||
Wholesale Leathercraft
|
$26,754,164
|
$4,663,590
|
$27,285,884
|
$5,300,413
|
|||
Retail Leathercraft
|
53,714,432
|
5,689,814
|
51,805,944
|
6,077,345
|
|||
International Leathercraft
|
3,692,604
|
121,296
|
4,339,084
|
580,271
|
|||
Total Operations
|
$84,161,200
|
$10,474,700
|
$83,430,912
|
$11,958,029
|
Wholesale Leathercraft
|
Quarter Ended 12/31/15
|
Quarter Ended 12/31/14
|
|||
# of stores
|
Sales
|
# of stores
|
Sales
|
||
Same store sales
|
28
|
$7,519,790
|
28
|
$7,674,739
|
|
New store sales
|
-
|
-
|
1
|
34,965
|
|
Closed store sales
|
-
|
-
|
-
|
-
|
|
Total Sales – Wholesale Leathercraft
|
28
|
$7,519,790
|
28
|
$7,709,704
|
Year Ended 12/31/15
|
Year Ended 12/31/14
|
||||
# of stores
|
Sales
|
# of stores
|
Sales
|
||
Same store sales
|
28
|
$26,754,164
|
28
|
$26,533,991
|
|
New store sales
|
-
|
-
|
1
|
403,243
|
|
Closed store sales
|
-
|
-
|
-
|
348,650
|
|
Total Sales – Wholesale Leathercraft
|
28
|
$26,754,164
|
28
|
$27,285,884
|
Retail Leathercraft
|
Quarter Ended 12/31/15
|
Quarter Ended 12/31/14
|
|||
# of stores
|
Sales
|
# of stores
|
Sales
|
||
Same store sales
|
80
|
$15,478,929
|
80
|
$15,505,922
|
|
New store sales
|
2
|
265,080
|
2
|
73,212
|
|
Closed store sales
|
-
|
-
|
-
|
-
|
|
Total Sales – Retail Leathercraft
|
82
|
$15,744,009
|
82
|
$15,579,134
|
Year Ended 12/31/15
|
Year Ended 12/31/14
|
||||
# of stores
|
Sales
|
# of stores
|
Sales
|
||
Same store sales
|
79
|
$51,986,010
|
79
|
$51,355,176
|
|
New store sales
|
3
|
1,728,422
|
3
|
450,768
|
|
Closed store sales
|
-
|
-
|
-
|
-
|
|
Total Sales – Retail Leathercraft
|
82
|
$53,714,432
|
82
|
$51,805,944
|
|
International Leathercraft
|
Quarter Ended 12/31/15
|
Quarter Ended 12/31/14
|
|||
# of stores
|
Sales
|
# of stores
|
Sales
|
||
Same store sales
|
3
|
$851,815
|
3
|
$1,182,767
|
|
New store sales
|
1
|
127,357
|
-
|
-
|
|
Total Sales – Intl Leathercraft
|
4
|
$979,172
|
3
|
$1,182,767
|
Year Ended 12/31/15
|
Year Ended 12/31/14
|
||||
# of stores
|
Sales
|
# of stores
|
Sales
|
||
Same store sales
|
3
|
$3,565,247
|
3
|
$4,339,084
|
|
New store sales
|
1
|
127,357
|
-
|
-
|
|
Total Sales – Intl Leathercraft
|
4
|
$3,692,604
|
3
|
$4,339,084
|
Three Months
|
Twelve Months
|
||||||
2015
(unaudited)
|
2014
|
2015
(unaudited)
|
2014
|
||||
NET SALES
|
$24,242,971
|
$24,471,605
|
$84,161,200
|
$83,430,912
|
|||
COST OF SALES
|
9,401,917
|
10,016,886
|
32,090,140
|
31,306,155
|
|||
Gross Profit
|
14,841,054
|
14,454,719
|
52,071,060
|
52,124,757
|
|||
OPERATING EXPENSES
|
10,948,828
|
10,576,557
|
41,596,360
|
40,166,728
|
|||
INCOME FROM OPERATIONS
|
3,892,226
|
3,878,162
|
10,474,700
|
11,958,029
|
|||
Interest expense
|
22,844
|
71,217
|
330,004
|
225,584
|
|||
Other, net
|
(6,287)
|
(30,962)
|
(74,357)
|
(75,165)
|
|||
Total other expense
|
16,557
|
40,255
|
255,647
|
150,419
|
|||
INCOME BEFORE INCOME TAXES
|
3,875,669
|
3,837,907
|
10,219,053
|
11,807,610
|
|||
PROVISION FOR INCOME TAXES
|
1,536,911
|
1,379,445
|
3,816,648
|
4,100,689
|
|||
NET INCOME
|
$2,338,758
|
$2,458,462
|
$6,402,405
|
$7,706,921
|
|||
|
|||||||
NET INCOME PER COMMON SHARE:
|
|||||||
Basic
|
$0.24
|
$0.24
|
$0.64
|
$0.76
|
|||
Diluted
|
$0.24
|
$0.24
|
$0.63
|
$0.75
|
|||
Weighted Average Number of Shares Outstanding:
|
|||||||
Basic
|
9,692,860
|
10,210,933
|
10,077,140
|
10,203,063
|
|||
Diluted
|
9,712,571
|
10,244,127
|
10,102,394
|
10,241,121
|
12/31/15
(unaudited)
|
12/31/14
|
||
ASSETS
|
|||
CURRENT ASSETS:
|
|||
Cash
|
$10,962,615
|
$10,636,530
|
|
Accounts receivable-trade, net of allowance for doubtful accounts
|
|||
of $1,700 and $400 in 2015 and 2014, respectively
|
553,206
|
625,054
|
|
Inventory
|
33,584,539
|
32,875,492
|
|
Prepaid income taxes
|
549,277
|
336,828
|
|
Deferred income taxes
|
326,830
|
371,491
|
|
Prepaid expenses
|
1,514,887
|
1,348,652
|
|
Other current assets
|
70,197
|
157,758
|
|
Total current assets
|
47,561,551
|
46,351,805
|
|
PROPERTY AND EQUIPMENT, at cost
|
23,992,208
|
22,199,943
|
|
Less accumulated depreciation and amortization
|
(8,297,155)
|
(7,037,665)
|
|
15,695,053
|
15,162,278
|
||
GOODWILL
|
953,356
|
971,786
|
|
OTHER INTANGIBLES, net of accumulated amortization of
|
|||
$702,000 and $665,000 in 2015 and 2014, respectively
|
27,282
|
58,026
|
|
OTHER assets
|
329,684
|
329,979
|
|
$64,566,926
|
$62,873,874
|
||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
|||
CURRENT LIABILITIES:
|
|||
Accounts payable-trade
|
$1,983,376
|
$1,255,218
|
|
Accrued expenses and other liabilities
|
6,045,552
|
5,394,514
|
|
Income taxes payable
|
-
|
-
|
|
Current maturities of capital lease obligation
|
72,686
|
-
|
|
Current maturities of long-term debt
|
231,952
|
3,702,500
|
|
Total current liabilities
|
8,333,566
|
10,352,232
|
|
DEFERRED INCOME TAXES
|
1,702,515
|
1,458,005
|
|
LONG-TERM DEBT, net of current maturities
|
3,479,273
|
1,940,625
|
|
CAPITAL LEASE OBLIGATION, net of current maturities
|
79,396
|
-
|
|
COMMITMENTS AND CONTINGENCIES
|
-
|
-
|
|
STOCKHOLDERS' EQUITY:
|
|||
Preferred stock, $0.10 par value; 20,000,000 shares
|
|||
authorized, none issued or outstanding
|
-
|
-
|
|
Common stock, $0.0024 par value; 25,000,000 shares
|
|||
authorized, 11,275,641 and 11,239,157 shares issued at 2015 and 2014,
|
|||
9,753,293 and 10,245,534 outstanding at 2015 and 2014, respectively
|
27,062
|
26,984
|
|
Paid-in capital
|
6,168,489
|
6,013,325
|
|
Retained earnings
|
53,067,234
|
46,664,829
|
|
Treasury stock at cost (1,522,348 shares at 2015 and 2014)
|
(6,602,930)
|
(2,894,068)
|
|
Accumulated other comprehensive income
|
(1,687,679)
|
(688,058)
|
|
Total stockholders' equity
|
50,972,176
|
49,123,012
|
|
$64,566,926
|
$62,873,874
|
2015
(unaudited)
|
2014
|
||||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
|||||||||
Net income
|
$6,402,405
|
$7,706,921
|
|||||||
Adjustments to reconcile net income to net cash
|
|||||||||
provided by operating activities -
|
|||||||||
Depreciation and amortization
|
1,567,172
|
1,436,624
|
|||||||
Loss on disposal or abandonment of assets
|
31,064
|
18,820
|
|||||||
Non-cash stock-based compensation
|
145,321
|
67,818
|
|||||||
Deferred income taxes
|
289,171
|
183,490
|
|||||||
Foreign currency translation
|
(896,927)
|
(727,664)
|
|||||||
Net changes in assets and liabilities, net of effect of
|
|||||||||
business acquisitions:
|
|||||||||
Accounts receivable-trade, net
|
71,848
|
137,351
|
|||||||
Inventory
|
(709,047)
|
(6,574,662)
|
|||||||
Income taxes
|
(212,449)
|
(609,026)
|
|||||||
Prepaid expenses
|
43,585
|
260,992
|
|||||||
Other current assets
|
87,561
|
320,835
|
|||||||
Accounts payable-trade
|
728,158
|
(629,419)
|
|||||||
Accrued expenses and other liabilities
|
651,038
|
(414,368)
|
|||||||
Total adjustments
|
1,796,495
|
(6,529,209)
|
|||||||
Net cash provided by operating activities
|
8,198,900
|
1,177,712
|
|||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
|||||||||
Purchase of property and equipment
|
(2,164,040)
|
(2,204,190)
|
|||||||
Purchase of intangible assets
|
(10,000)
|
-
|
|||||||
Proceeds from sale of assets
|
11,662
|
20,936
|
|||||||
Decrease (increase) in other assets
|
295
|
11,980
|
|||||||
Net cash (used in) provided by investing activities
|
(2,162,083)
|
(2,171,274)
|
|||||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
|||||||||
Net (decrease) increase in revolving credit loans
|
(3,500,000)
|
3,500,000
|
|||||||
Proceeds from notes payable and long-term debt
|
3,711,224
|
-
|
|||||||
Payments on notes payable and long-term debt
|
(2,143,125)
|
(455,625)
|
|||||||
Payments on capital lease obligations
|
(79,889)
|
-
|
|||||||
Payment of dividend
|
-
|
(2,549,684)
|
|||||||
Repurchase of common stock (treasury stock)
|
(3,708,862)
|
-
|
|||||||
Proceeds from issuance of common stock
|
9,920
|
52,722
|
|||||||
Net cash provided by (used in) financing activities
|
(5,710,732)
|
547,413
|
|||||||
NET (DECREASE) INCREASE IN CASH
|
326,085
|
(446,149)
|
|||||||
CASH, beginning of period
|
10,636,530
|
11,082,679
|
|||||||
CASH, end of period
|
$10,962,615
|
$10,636,530
|
|||||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
|
|||||||||
Interest paid during the period
|
$330,004
|
$225,584
|
|||||||
Income tax paid during the period, net of (refunds)
|
3,743,864
|
4,804,087
|
|||||||
NON-CASH INVESTING ACTIVITIES:
|
|||||||||
Equipment purchased via capital lease arrangements
|
$231,972
|
-
|
|||||||