-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, F3JeaFtsl1XsJiqjndnTtx8DL7+I4xqjdjnMQvaSRDMpPGomGcaURWAmk54UO9Eb dsj2740fYkrOfizyrp4s8Q== 0000096294-99-000016.txt : 19990426 0000096294-99-000016.hdr.sgml : 19990426 ACCESSION NUMBER: 0000096294-99-000016 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990423 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19990423 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TANDYCRAFTS INC CENTRAL INDEX KEY: 0000096294 STANDARD INDUSTRIAL CLASSIFICATION: RETAIL-MISCELLANEOUS SHOPPING GOODS STORES [5940] IRS NUMBER: 751475224 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-07258 FILM NUMBER: 99599617 BUSINESS ADDRESS: STREET 1: 1400 EVERMAN PKWY CITY: FORT WORTH STATE: TX ZIP: 76140 BUSINESS PHONE: 8175519600 MAIL ADDRESS: STREET 1: 1400 EVERMAN PKWY CITY: FORT WORTH STATE: TX ZIP: 76140 8-K 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report: April 23, 1999 Date of Earliest Event Reported: April 21, 1999 TANDYCRAFTS, INC. A DELAWARE CORPORATION 1-7258 75-1475224 ------ ---------- (Commission File Number) (IRS Employer Identification No.) 1400 Everman Parkway Fort Worth, Texas 76140 (817) 551-9600 ITEM 5. OTHER EVENTS ------------ (a) On April 21, 1999, Registrant issued a press release announcing the unaudited results of operations for the three- and nine-month periods ended March 31, 1999. ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS --------------------------------- (c) Exhibits. -------- Exhibit Number Description -------- ------------------------------------------------ 99 Copy of press release announcing the unaudited results of operations for the three- and nine- month periods ended March 31, 1999. SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf of the undersigned thereunto duly authorized. TANDYCRAFTS, INC. Date: April 23, 1999 By:/s/ Michael J. Walsh -------------------------- Michael J. Walsh, President and Chief Executive Officer Date: April 23, 1999 By:/s/ James D. Allen -------------------------- James D. Allen, Executive Vice President and Chief Financial Officer Date: April 23, 1999 By:/s/ Troy A. Huseman -------------------------- Troy A. Huseman Assistant Vice President and Chief Accounting Officer EX-99 2 CONTACT: Jim Allen, Mike Murray Tandycrafts, Inc. (817) 551-9600 (investor_relations@tandycrafts.com) FOR IMMEDIATE RELEASE or Jeff Lambert, Brian Edwards (LamEdPR@aol.com) Lambert, Edwards & Associates, Inc. (616) 233-0500 TANDYCRAFTS ANNOUNCES THIRD-QUARTER RESULTS FORT WORTH, Texas - April 21, 1999 - Tandycrafts, Inc. (NYSE: TAC) today announced financial results and operating highlights for its fiscal 1999 third quarter and nine-month period ended March 31, 1999. The Fort Worth, Texas-based consumer products company reported a net loss of $1.9 million, or $0.16 per share, on net sales of $50.3 million in the quarter ended March 31, 1999, compared with net income of $198,000, or $0.02 per share, on net sales of $53.1 million in the prior year period. Tandycrafts said the results include approximately $3.2 million in expenses related to the previously announced closure of its leather and craft retail stores and related manufacturing operations. Tandycrafts attributed the decrease in sales versus the year-ago quarter primarily to the 1998 divestiture of its Joshua's Christian Stores operations and the ongoing transition of the Company's leather and craft operations from retail stores to direct distribution. Sales from comparable operations, excluding leather and crafts, increased 5% over the same quarter last year, fueled by Pinnacle Art & Frame, Tandycrafts' frames and wall decor division, which posted a sales increase of 7% in the quarter. This sales performance helped offset lower revenues at the Company's novelties and promotional segment, reflecting this division's strategy of focusing on larger customers as well as softness in the overall market for sports-licensed products. "We are encouraged by our results, which reflect solid progress in both our reorganization efforts and our continuing operations," said Michael Walsh, president and chief executive officer. "Our Pinnacle frames business is having a solid year of top-line growth and should continue to be the growth engine for Tandycrafts. We are looking forward to bringing our new Mexico frames facility online in the fourth quarter, which will provide increased efficiency and production capabilities. We fully expect that our dual focus on accelerating growth in our profitable operations and refocusing our underperforming divisions will result in increased value for our shareholders." Walsh continued: "The recent sale of Nocona Belt Company and better-than- anticipated closeout sales of the leather and craft store inventories are contributing to improved cash flow. Our transition plan is working efficiently and, as a result, we expect our ultimate operating losses relating to the closure of the leather and crafts division to be less than originally anticipated." Tandycrafts said total charges related to the reorganization of the Tandy Leather division would likely be in the range of $20 million to $22 million in fiscal 1999, versus the $25 million to $29 million range that was previously announced. Tandycrafts' fiscal year ends June 30, 1999. Lower-than-expected expenditures, early collection of receivables from the sale of Joshua's and improved cash flow enabled Tandycrafts to further reduce its long-term debt and interest expense in the most recent quarterly and nine-month periods, versus the same periods last year. Long-term debt at March 31, 1999 was $27.5 million, down 32% versus the year-ago period, resulting in lower interest expense. Net interest expense decreased 39% in the 1999 third quarter versus the same period a year-ago. Tandycrafts reported a $1 million reduction in net interest expense through the first nine months of 1999. "Our efforts to refine the business and focus on our most profitable business segments are designed to positively impact both our income statement and balance sheet. We are working diligently to reduce long-term debt and improve our financial strength and look forward to applying these additional resources toward future growth," said Jim Allen, executive vice president and chief operating officer of Tandycrafts. Allen said areas that are receiving additional focus and spending include advertising and new product development at several operating units. Continued investment in information technology and distribution resources will allow the Company to centralize certain corporate functions and improve operating efficiency. Tandycrafts, Inc. (www.tandycrafts.com) is a leading maker and marketer of consumer products, including frames and wall decor, office supplies, leather and crafts, and novelties and gift products. The Company's products are sold nationwide through wholesale distribution channels, including mass merchandisers and specialty retailers, and direct-to-consumer channels through the Company's retail stores, mail order and the Internet. This press release includes statements that may constitute "forward-looking" statements, usually containing the words "believe", "estimate", "project", "expect" or similar expressions. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to, continued acceptance of the Company's products in the marketplace, competitive factors, dependence upon third-party vendors, and other risks detailed in the Company's periodic report filings with the Securities and Exchange Commission. By making these forward-looking statements, the Company undertakes no obligation to update these statements for revisions or changes after the date of this release. Three Months Ended Nine Months Ended ----------------------- ---------------------- March 31, March 31, March 31, March 31, 1999 1998 1999 1998 --------- --------- --------- --------- Net sales $ 50,253 $ 53,100 $ 154,171 $ 181,696 Operating costs and expenses: Cost of goods sold 36,061 35,766 110,328 120,302 Selling, general and administrative 15,094 14,935 48,525 48,532 Restructuring charge - - 8,145 - Depreciation and amortization 1,117 1,254 3,284 3,783 --------- --------- --------- --------- Total operating costs and expenses 52,272 51,955 170,282 172,617 --------- --------- --------- --------- Operating income (loss) (2,019) 1,145 (16,111) 9,079 Interest expense, net 517 841 1,600 2,614 --------- --------- --------- --------- Income (loss) before income taxes (2,536) 304 (17,711) 6,465 Provision for income taxes (663) 106 (4,623) 2,262 --------- --------- --------- --------- Net income (loss) $ (1,873) $ 198 $ (13,088) $ 4,203 ========= ========= ========= ========= Net income (loss) per share - basic and diluted $ (0.16) $ 0.02 $ (1.07) $ 0.33 ========= ========= ========= ========= Weighted average common shares: Basic 12,052 12,649 12,236 12,657 Diluted 12,052 12,649 12,239 12,657
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