Date of report (Date of earliest event reported:)
|
May 3, 2017
|
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: May 3, 2017
|
By: /s/ Shannon L. Greene
|
Shannon L. Greene, Chief Executive Officer
|
|
Contact:
|
Tina Castillo, Tandy Leather Factory, Inc.
|
(817) 872-3200 or tcastillo@tandyleather.com
|
Mark Gilbert, Magellan Fin, LLC
|
(317) 867-2839 or MGilbert@MagellanFin.com
|
Quarter Ended 03/31/17
|
Quarter Ended 03/31/16
|
|||||||||||||||
Sales
|
Income from Operations
|
Sales
|
Income from Operations
|
|||||||||||||
North America*
|
$
|
19,231,714
|
$
|
1,811,563
|
$
|
19,739,491
|
$
|
2,341,209
|
||||||||
International
|
918,131
|
(74,072
|
)
|
932,736
|
21,581
|
|||||||||||
Total Operations
|
$
|
20,149,845
|
$
|
1,737,491
|
$
|
20,672,227
|
$
|
2,362,790
|
North America*
|
Quarter Ended 03/31/17
|
Quarter Ended 03/31/16
|
||||||||||||||
# of stores
|
Sales
|
# of stores
|
Sales
|
|||||||||||||
Same store sales
|
108
|
$
|
18,737,881
|
108
|
$
|
19,175,528
|
||||||||||
New store sales(a)
|
4
|
407,655
|
1
|
79,654
|
||||||||||||
Closed store sales(b)
|
3
|
86,178
|
3
|
484,309
|
||||||||||||
Total Sales – North America
|
112
|
$
|
19,231,714
|
110
|
$
|
19,739,491
|
(a)
|
Nyack, NY opened March 2016; Philadelphia, PA opened October 2016; Lyndhurst, NJ opened November 2016; and Johnston, RI opened December 2016. Allen, TX opened April 17,2017 and is not included in these results.
|
(b)
|
Harrisburg, PA temporarily closed from April 2016 to December 2016; Tucson, AZ closed March 2016; and Allentown, PA closed April 2016.
|
International
|
Quarter Ended 03/31/17
|
Quarter Ended 03/31/16
|
||||||||||||||
# of stores
|
Sales
|
# of stores
|
Sales
|
|||||||||||||
Same store sales
|
4
|
$
|
918,131
|
4
|
$
|
932,736
|
||||||||||
New store sales
|
-
|
-
|
-
|
|||||||||||||
Total Sales – International
|
4
|
$
|
918,131
|
4
|
$
|
932,736
|
3/31/17
(unaudited)
|
12/31/16
(audited)
|
|||||||
ASSETS
|
||||||||
CURRENT ASSETS:
|
||||||||
Cash
|
$
|
16,407,211
|
$
|
16,862,304
|
||||
Accounts receivable-trade, net of allowance for doubtful accounts
|
||||||||
of $3,548 and $2,404 in 2017 and 2016, respectively
|
524,692
|
560,984
|
||||||
Inventory
|
34,382,003
|
33,177,539
|
||||||
Prepaid income taxes
|
474,487
|
964,323
|
||||||
Prepaid expenses
|
1,710,217
|
1,608,860
|
||||||
Other current assets
|
264,617
|
140,232
|
||||||
Total current assets
|
53,763,227
|
53,314,242
|
||||||
PROPERTY AND EQUIPMENT, at cost
|
26,156,413
|
25,536,352
|
||||||
Less accumulated depreciation and amortization
|
(10,350,479
|
)
|
(9,884,559
|
)
|
||||
15,805,934
|
15,651,793
|
|||||||
DEFERRED INCOME TAXES
|
376,884
|
331,086
|
||||||
GOODWILL
|
957,347
|
956,201
|
||||||
OTHER INTANGIBLES, net of accumulated amortization of
|
||||||||
$709,000 and $708,000 in 2017 and 2016, respectively
|
20,396
|
20,840
|
||||||
OTHER ASSETS
|
344,986
|
334,408
|
||||||
$
|
71,268,774
|
$
|
70,608,570
|
|||||
LIABILITIES AND STOCKHOLDERS' EQUITY
|
||||||||
CURRENT LIABILITIES:
|
||||||||
Accounts payable-trade
|
$
|
2,424,445
|
$
|
1,621,884
|
||||
Accrued expenses and other liabilities
|
4,219,821
|
5,937,187
|
||||||
Current maturities of capital lease obligation
|
72,686
|
72,686
|
||||||
Current maturities of long-term debt
|
1,075,044
|
614,311
|
||||||
Total current liabilities
|
7,791,996
|
8,246,068
|
||||||
DEFERRED INCOME TAXES
|
1,854,493
|
1,911,882
|
||||||
LONG-TERM DEBT, net of current maturities
|
6,296,685
|
6,757,419
|
||||||
CAPITAL LEASE OBLIGATION, net of current maturities
|
-
|
-
|
||||||
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, 11,318,331 and 11,309,326 shares issued at 2016 and 2015,
|
||||||||
9,275,501 and 9,266,496 outstanding at 2016 and 2015, respectively
|
27,164
|
27,142
|
||||||
Paid-in capital
|
6,413,051
|
6,368,279
|
||||||
Retained earnings
|
60,700,758
|
59,469,493
|
||||||
Treasury stock at cost (2,042,830 shares at 2017 and 2016)
|
(10,278,584
|
)
|
(10,278,584
|
)
|
||||
Accumulated other comprehensive income
|
(1,536,789
|
)
|
(1,893,129
|
)
|
||||
Total stockholders' equity
|
55,325,600
|
53,693,201
|
||||||
$
|
71,268,774
|
$
|
70,608,570
|
|||||
2017
|
2016
|
NET SALES
|
$
|
20,149,845
|
$
|
20,672,227
|
||||
COST OF SALES
|
7,863,800
|
8,019,481
|
||||||
Gross profit
|
12,286,045
|
12,652,746
|
||||||
OPERATING EXPENSES
|
10,548,554
|
10,289,956
|
||||||
INCOME FROM OPERATIONS
|
1,737,491
|
2,362,790
|
||||||
OTHER (INCOME) EXPENSE:
|
||||||||
Interest expense
|
36,344
|
23,429
|
||||||
Other, net
|
(2,651
|
)
|
39
|
|||||
Total other (income) expense
|
33,693
|
23,468
|
||||||
INCOME BEFORE INCOME TAXES
|
1,703,798
|
2,339,322
|
||||||
PROVISION FOR INCOME TAXES
|
472,533
|
818,325
|
||||||
NET INCOME
|
$
|
1,231,265
|
$
|
1,520,997
|
||||
NET INCOME PER COMMON SHARE:
|
||||||||
BASIC
|
$
|
0.13
|
$
|
0.16
|
||||
DILUTED
|
$
|
0.13
|
$
|
0.16
|
||||
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING:
|
||||||||
BASIC
|
9,309,424
|
9,698,951
|
||||||
DILUTED
|
9,330,303
|
9,718,453
|
2017
|
2016
|
|||||||
CASH FLOWS FROM OPERATING ACTIVITIES:
|
||||||||
Net income
|
$
|
1,231,265
|
$
|
1,520,997
|
||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
|
||||||||
Depreciation and amortization
|
458,118
|
414,228
|
||||||
Loss / (gain) on disposal or abandonment of assets
|
335
|
(12,023
|
)
|
|||||
Non-cash stock-based compensation
|
44,794
|
43,762
|
||||||
Deferred income taxes
|
(103,187
|
)
|
31,717
|
|||||
Foreign currency translation
|
344,789
|
614,366
|
||||||
Net changes in assets and liabilities:
|
||||||||
Accounts receivable-trade, net
|
36,292
|
(129,374
|
)
|
|||||
Inventory
|
(1,204,464
|
)
|
(47,763
|
)
|
||||
Prepaid expenses
|
(101,357
|
)
|
(112,282
|
)
|
||||
Other current assets
|
(126,374
|
)
|
(76,076
|
)
|
||||
Accounts payable-trade
|
802,561
|
(63,065
|
)
|
|||||
Accrued expenses and other liabilities
|
(1,717,366
|
)
|
(1,471,776
|
)
|
||||
Income taxes payable
|
489,836
|
360,847
|
||||||
Total adjustments
|
(1,076,023
|
)
|
(447,439
|
)
|
||||
Net cash provided by operating activities
|
155,242
|
1,073,558
|
||||||
CASH FLOWS FROM INVESTING ACTIVITIES:
|
||||||||
Purchase of property and equipment
|
(599,757
|
)
|
(606,932
|
)
|
||||
Proceeds from sale of assets
|
-
|
22,625
|
||||||
(Decrease) in other assets
|
(10,578
|
)
|
(154
|
)
|
||||
Net cash used in investing activities
|
(610,335
|
)
|
(584,461
|
)
|
||||
CASH FLOWS FROM FINANCING ACTIVITIES:
|
||||||||
Proceeds from notes payable and long term debt
|
-
|
2,870,000
|
||||||
Payments on capital lease obligations
|
-
|
(6,710
|
)
|
|||||
Repurchase of common stock (treasury stock)
|
-
|
(2,870,740
|
)
|
|||||
Net cash used in financing activities
|
-
|
(7,450
|
)
|
|||||
NET (DECREASE) INCREASE IN CASH
|
(455,093
|
)
|
481,647
|
|||||
CASH, beginning of period
|
16,862,304
|
10,962,615
|
||||||
CASH, end of period
|
$
|
16,407,211
|
$
|
11,444,262
|
||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
|
||||||||
Interest paid during the period
|
$
|
36,344
|
$
|
23,429
|
||||
Income tax paid during the period, net of (refunds)
|
$
|
17,303
|
$
|
457,478
|
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