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)
|
3847
East Loop 820 South, Fort Worth, Texas
|
76119
|
|
(Address
of Principal Executive Offices)
|
(Zip
Code)
|
(817)
496-4414
|
(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.
|
Date:
February 21, 2008
|
By:
/s/
Ron Morgan
|
Ron
Morgan, Chief Executive Officer and
President
|
Contact:
|
Shannon
L Greene
|
Tandy
Leather Factory, Inc.
|
817/496-4414
or sgreene@tandyleather.com
|
Mark
Gilbert
|
Magellan
Fin, LLC
|
(317)
867-2839 or
MGilbert@MagellanFin.com
|
Quarter
Ended 12/31/07
|
Quarter
Ended 12/31/06
|
||||||
Sales
|
Operating
Income
|
Sales
|
Operating
Income
|
||||
Wholesale
Leathercraft
|
$7498,855
|
$1,036,454
|
$7,817,851
|
$1,138,583
|
|||
Retail
Leathercraft
|
6,910,136
|
665,828
|
6,661,625
|
986,967
|
|||
Other
|
216,886
|
44,311
|
353,221
|
(62,347)
|
|||
Total
Operations
|
$14,625,877
|
$1,746,593
|
$14,832,697
|
$2,063,203
|
Year
Ended 12/31/07
|
Year
Ended 12/31/06
|
||||||
Sales
|
Operating
Income
|
Sales
|
Operating
Income
|
||||
Wholesale
Leathercraft
|
$29,555,978
|
$2,826,710
|
$30,697,970
|
4,814,239
|
|||
Retail
Leathercraft
|
24,663,751
|
1,544,320
|
22,520,461
|
2,310,073
|
|||
Other
|
1,097,27
|
139,971
|
1,980,590
|
(56,598)
|
|||
Total
Operations
|
$55,317,002
|
$4,511,001
|
$55,199,021
|
$7,067,714
|
Wholesale
Leathercraft
|
Quarter
Ended 12/31/07
|
Quarter
Ended 12/31/06
|
||||
#
of stores
|
Sales
|
#
of stores
|
Sales
|
|||
Same
store sales
|
29
|
$6,403,575
|
29
|
$6,909,305
|
||
New
store sales
|
1
|
166,190
|
-
|
-
|
||
National
account group
|
929,090
|
908,546
|
||||
Total
Sales - Wholesale Leathercraft
|
$7,498,855
|
$7,817,851
|
Wholesale
Leathercraft
|
Year
Ended 12/31/07
|
Year
Ended 12/31/06
|
||||
#
of stores
|
Sales
|
#
of stores
|
Sales
|
|||
Leather
Factory stores
|
29
|
$25,133,477
|
29
|
$26,431,133
|
||
New
store sales
|
1
|
719,641
|
-
|
-
|
||
National
account group
|
3,702,860
|
4,266,837
|
||||
Total
Sales - Wholesale Leathercraft
|
$29,555,978
|
$30,697,970
|
Retail
Leathercraft
|
Quarter
Ended 12/31/07
|
Quarter
Ended 12/31/06
|
|||
#
of stores
|
Sales
|
#
of stores
|
Sales
|
||
Same
store sales
|
62
|
$6,337,241
|
62
|
$6,661,625
|
|
New
store sales
|
10
|
572,895
|
-
|
-
|
|
Total
Sales - Retail Leathercraft
|
72
|
$6,910,136
|
62
|
$6,661,625
|
Retail
Leathercraft
|
Year
Ended 12/31/07
|
Year
Ended 12/31/06
|
|||
#
of stores
|
Sales
|
#
of stores
|
Sales
|
||
Same
store sales
|
52
|
$20,896,677
|
52
|
$20,805,686
|
|
New
store sales
|
20
|
3,767,074
|
10
|
1,714,775
|
|
Total
Sales - Retail Leathercraft
|
72
|
$24,663,751
|
62
|
$22,520,461
|
Three
Months
|
Twelve
Months
|
||||
2007
(unaudited)
|
2006
|
2007
(unaudited)
|
2006
|
||
NET
SALES
|
$14,625,877
|
$14,832,697
|
$55,317,002
|
$55,199,021
|
|
COST
OF SALES
|
6,178,730
|
6,107,775
|
23,644,599
|
23,566,251
|
|
Gross
Profit
|
8,447,147
|
8,724,922
|
31,672,403
|
31,632,770
|
|
OPERATING
EXPENSES
|
6,700,554
|
6,661,719
|
27,161,402
|
24,565,056
|
|
INCOME
FROM OPERATIONS
|
1,746,593
|
2,063,203
|
4,511,001
|
7,067,714
|
|
Interest
expense
|
71,715
|
-
|
122,209
|
-
|
|
Other,
net
|
(89,868)
|
(13,440)
|
(439,040)
|
(98,391)
|
|
Total
other expense
|
(18,153)
|
(13,440)
|
(316,831)
|
(98,391)
|
|
INCOME
BEFORE INCOME TAXES
|
1,764,746
|
2,076,643
|
4,827,832
|
7,166,105
|
|
PROVISION
FOR INCOME TAXES
|
591,263
|
668,751
|
1,739,701
|
2,389,039
|
|
NET
INCOME
|
$1,173,482
|
$1,407,892
|
$3,088,131
|
$4,777,066
|
|
NET
INCOME PER COMMON SHARE - BASIC
|
$0.11
|
$0.13
|
$0.28
|
$0.44
|
|
NET
INCOME PER COMMON SHARE - DILUTED
|
$0.11
|
$0.13
|
$0.28
|
$0.43
|
|
Weighted
Average Number of Shares Outstanding:
|
|||||
Basic
|
10,974,222
|
10,862,496
|
10,951,481
|
10,807,316
|
|
Diluted
|
11,160,034
|
11,137,095
|
11,157,775
|
11,113,855
|
12/31/07
(unaudited)
|
12/31/06
|
|
Cash
|
$6,810,396
|
$6,739,891
|
Accounts
receivable, net of allowance for doubtful accounts
|
2,538,816
|
2,599,279
|
Inventory
|
17,473,352
|
17,169,358
|
Deferred
income taxes
|
256,938
|
266,018
|
Other
current assets
|
1,481,004
|
1,089,258
|
Total
current assets
|
28,560,505
|
27,863,804
|
Property
and equipment, net
|
6,620,644
|
1,876,605
|
Goodwill
and other intangibles, net
|
1,374,671
|
1,106,815
|
Other
assets
|
1,095,686
|
1,069,411
|
$37,651,506
|
$31,916,635
|
|
Accounts
payable
|
$1,497,564
|
$1,776,646
|
Accrued
expenses and other liabilities
|
2,072,640
|
3,424,010
|
Income
taxes payable
|
67,150
|
59,392
|
Notes
payable and current maturities of long-term debt
|
151,875
|
111,723
|
Total
current liabilities
|
3,789,229
|
5,371,771
|
Deferred
income taxes
|
148,648
|
221,621
|
Notes
payable and long-term debt, net of current maturities
|
3,898,125
|
-
|
Total
liabilities
|
7,836,002
|
5,593,392
|
Common
stock
|
26,359
|
26,124
|
Paid-in
capital
|
5,419,477
|
5,292,591
|
Treasury
stock (5,859 shares)
|
(25,487)
|
(25,487)
|
Retained
earnings
|
24,037,672
|
20,949,540
|
Accumulated
other comprehensive loss
|
357,483
|
80,475
|
Total
Stockholders' Equity
|
29,815,504
|
26,323,243
|
$37,651,506
|
$31,916,635
|
2007
(unaudited)
|
2006
|
||
CASH
FLOWS FROM OPERATING ACTIVITIES:
|
|||
Net
income
|
$3,088,131
|
$4,777,066
|
|
Adjustments
to reconcile net income to net cash provided by operating
activities:
|
|||
Depreciation
& amortization
|
634,291
|
392,915
|
|
(Gain)
loss on disposal of assets
|
50,114
|
(3,750)
|
|
Non-cash
stock-based compensation
|
19,340
|
101,080
|
|
Deferred
income taxes
|
(63,893)
|
23,222
|
|
Other
|
241,1822
|
(15,696)
|
|
Net
changes in assets and liabilities:
|
|||
Accounts
receivable-trade, net
|
116,815
|
(420,431)
|
|
Inventory
|
46,228
|
(1,500,176)
|
|
Income
taxes
|
7,758
|
(140,189)
|
|
Other
current assets
|
(407,729)
|
(731,200)
|
|
Accounts
payable
|
(327,726)
|
556,226
|
|
Accrued
expenses and other liabilities
|
(1,351,369)
|
873,437
|
|
Total
adjustments
|
(1,034,990)
|
(864,562)
|
|
Net
cash provided by operating activities
|
2,053,141
|
3,912,504
|
|
CASH
FLOWS FROM INVESTING ACTIVITIES:
|
|||
Purchase
of property and equipment
|
(5,384,698)
|
(471,753)
|
|
Payments
in connection with businesses acquired
|
(650,000)
|
-
|
|
Proceeds
from sale of assets
|
32,281
|
3,750
|
|
Increase
in other assets
|
(26,276)
|
10,320
|
|
Net
cash used in investing activities
|
(6,028,693)
|
(457,683)
|
|
CASH
FLOWS FROM FINANCING ACTIVITIES:
|
|||
Net
increase (decrease) in revolving credit loans
|
4,050,000
|
-
|
|
Payments
on notes payable and long-term debt
|
(111,723)
|
(134,067)
|
|
Payments
received on notes secured by common stock
|
-
|
-
|
|
Repurchase
of common stock (treasury stock)
|
-
|
-
|
|
Proceeds
from issuance of common stock
|
107,780
|
203,410
|
|
Net
cash provided by financing activities
|
4,046,057
|
69,343
|
|
NET
CHANGE IN CASH
|
70,505
|
3,524,164
|
|
CASH,
beginning of period
|
6,739,891
|
3,215,727
|
|
CASH,
end of period
|
$6,810,396
|
$6,739,891
|
|
SUPPLEMENTAL
DISCLOSURES OF CASH FLOW INFORMATION:
|
|||
Interest
paid during the period
|
122,209
|
-
|
|
Income
taxes paid during the period, net of (refunds)
|
1,830,688
|
2,282,113
|
|
NON-CASH
INVESTING ACTIVITIES:
|
|||
Equipment
acquired under capital lease financing arrangements
|
-
|
-
|