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: January 28, 1997
Date of Earliest Event Reported: January 27, 1997
TANDYCRAFTS, INC.
A DELAWARE CORPORATION
1-7258 75-1475224
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(Commission File Number) (IRS Employer Identification No.)
1400 Everman Parkway
Fort Worth, Texas 76140
(817) 551-9600
ITEM 5. OTHER EVENTS
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(a) On January 27, 1997, Registrant issued a press release announcing
the unaudited results of operations for the three- and six-month
periods ended December 31, 1996.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
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(c) Exhibits.
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Exhibit
Number Description
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99 Copy of press release announcing the
unaudited results of operations for
the three- and six-month periods
ended December 31, 1996.
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: January 27, 1997 By:/s/ Michael J. Walsh
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Michael J. Walsh,
President
Date: January 27, 1997 By:/s/ James D. Allen
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James D. Allen
Chief Financial Officer
TANDYCRAFTS, INC. REPORTS FOURTH CONSECUTIVE QUARTER
OF SIGNIFICANTLY IMPROVED EARNINGS
COMPARED TO PRIOR YEAR PERIODS
Fort Worth, Texas. January 27, 1997 -- One year after announcing a major
restructuring plan, TANDYCRAFTS, INC. (NYSE: TAC) announced today significantly
improved results for its fiscal second quarter ended December 31, 1996. Net
income for the quarter was $2,285,000, or $0.19 per share compared to a net loss
of $12,379,000 or $1.04 per share for the same period of fiscal 1996. The
results for the prior year quarter included restructuring charges of $12.6
million, after tax, or, $1.06 per share.
Excluding those operations divested as part of the Company's strategic
restructuring program, net sales increased 4.6% when compared to the same
quarter last year, with both the retail and manufacturing segments achieving
similar increases. Retail sales were curtailed by the shorter Christmas selling
season this year as well as inclement weather, which primarily affected Tandy
Leather stores in the Northwest; however, the Company's Sav-On Office Supplies
and Joshua's Christian Stores chains still achieved same store sales gains of
23.4% and 9.4%, respectively, for the quarter. The manufacturing segment,
particularly the Picture Frames and Framed Art division, experienced a strong
surge of orders toward the end of the quarter and finished the quarter with a
significantly higher backlog of orders than in the prior year. Consolidated net
sales for the quarter were $73,246,000, a 1.5% decrease compared to the
$74,347,000 reported for the comparable quarter last year.
In commenting on the Company's performance, R. Earl Cox III, Chairman, stated
"This quarter marks the one-year anniversary since the Company embarked on a
major restructuring plan. The successful execution of that plan has led the
company to four consecutive quarters with significantly improved results
compared to the prior year periods. For the twelve months ended December 31,
1996, operating income, excluding restructuring charges, has more than tripled
to approximately $10.8 million. The results for the quarter just ended continue
to reflect that progress as operating income, excluding restructuring charges,
increased 193.0% to $4,348,000. We are encouraged by the improvement in
profitability during this period of transition as well as significant
improvements in the Company's overall financial position and debt level. While
we are pleased with the Company's progress to date, there remains much work
during the remainder of fiscal 1997 to position the Company's various operating
units to achieve the level of performance that we expect in the future."
Tandycrafts, Inc. is a specialty retailer and manufacturer. Included in its
Specialty Retail segment are Tandy Leather Company, Joshua's Christian Stores,
Cargo Furniture & Accents, and Sav-On Office Supplies. The Specialty
Manufacturing segment is comprised of two manufacturing divisions: Picture
Frames and Framed Art and Tandy Wholesale International ("TWI"). Information
disclosed in this news release which are forward-looking statements involve
risks with uncertainties including, but not limited to, the performance of each
operating unit, relationships with certain key customers, commodity price
fluctuations, interest rate fluctuations, recessionary factors, seasonality, and
other risks indicated in filings with the Securities and Exchange Commission
such as Tandycrafts' most recent Form 10-Q and 10-K.
(Table to follow)
<TABLE><S><C>
Three Months Ended Six Months Ended
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December 31, December 31, December 31, December 31,
1996 1995 1996 1995
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Net sales $ 73,246 $ 74,347 $ 131,016 $ 136,696
Operating costs and expenses:
Cost of goods sold 46,732 47,885 82,420 86,698
Selling, general and
administrative 20,775 23,263 39,437 44,176
Depreciation and amortization 1,391 1,715 2,763 3,240
Restructuring charge - 18,818 - 18,818
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Total operating costs
and expenses 68,898 91,681 124,620 152,932
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Operating income (loss) 4,348 (17,334) 6,396 (16,236)
Interest expense, net 833 1,117 1,655 2,202
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Income (loss) before
income taxes 3,515 (18,451) 4,741 (18,438)
Provision (benefit) for
income taxes 1,230 (6,072) 1,659 (6,068)
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Net income (loss) $ 2,285 $ (12,379) $ 3,082 $ (12,370)
============ ============ ============ ============
Net income (loss) per share $0.19 ($1.04) $0.25 ($1.04)
===== ===== ===== =====
Weighted average common and
common equivalent shares 12,346 11,935 12,272 11,852
</TABLE>
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