Tandy Brands Accessories (TBACQ) 8-K Tandy Brands Accessories Reports Second Quarter 2005 Results

EXHIBIT 99

Tandy Brands Accessories, Inc.	Investor Relations:
J.S.B. Jenkins	Integrated Corporate Relations
President/Chief Executive Officer	Bill Zima (203) 682-8200
(817) 548-0090	Media Relations:
britt_jenkins@tandybrands.com	Monarch Communications, Inc.
	Jeff Siegel (516) 569-6144

TANDY BRANDS ACCESSORIES REPORTS
SECOND QUARTER 2005 RESULTS

Second Quarter Sales and Net Income Increase 15.3% and 9.8%.

ARLINGTON, TX, January 25, 2005 — Tandy Brands Accessories, Inc. (Nasdaq NM:TBAC)today announced financial results for the second quarter ended December 31, 2004.

For the second quarter of fiscal 2005, net sales increased 15.3% to $74.0 million compared to $64.2 million for the same period last year. Net income for the second quarter increased 9.8% to $4.3 million compared to the year ago level of $3.9 million. Earnings per diluted share for the second quarter increased 6.6% to $0.65 compared to $0.61 per diluted share in the year ago quarter.

During the second quarter of fiscal 2005, the company incurred a charge included in selling, general and administrative expense, which reduced earnings by $0.06 per diluted share in the second quarter. The charge related to a liability incurred to settle a pending legal dispute. Excluding this charge, earnings per diluted share for the quarter would have increased 16.4% to $0.71. This non-GAAP measure may not be comparable to similar measures used by other entities and should not be considered as an alternative to net income, which is determined in accordance in GAAP.

For the six months ended December 31, 2004, net sales were $134.5 million compared to $128.4 million for the same period in the prior year. Net income for the six-month period totaled $7.1 million, or $1.09 per diluted share, compared to net income of $6.8 million, or $1.07 per diluted share, for the same period last year.

J. S. B. Jenkins, President and Chief Executive Officer, commented, “We were very pleased with our sales and gross margin increases for the second quarter which exceeded the prior year. These results were driven by strong performance in our core men’s business as well as better-than-expected performance from our Eton gift accessory business. Our women’s mass merchant accessories business stabilized in the second quarter in which sales and gross margin exceeded the same period in the prior year. Although our selling, general and administrative expense was above the prior year due in part to the legal expense discussed above, we are pleased with the 6.6% increase in earnings per diluted share over the same quarter last year.”

The company anticipates that third quarter net sales are likely be in the range of $43 million to $46 million and earnings to be within a range of $0.05 to $0.09 per diluted share. For the full 2005 fiscal year, the company anticipates net sales to be in the range of $220 to $227 million and earnings to be within a range of $1.25 to $1.30 per diluted share.

Conference Call Information
Investors and interested parties will have the opportunity to listen to management’s discussion of Tandy Brands’ second quarter results in a conference call to be held today, Tuesday, January 25, 2005, at 10:00 a.m. ET. The dial-in number for the call is (913) 981-5522. For those who are unable to listen to the live broadcast, an audio replay of the call will be available through Tuesday, February 1, 2005, and can be accessed by dialing (719) 457-0820, passcode #4672422. A live webcast of the conference call will also be broadcast at: www.viavid.net.

About Tandy Brands Accessories, Inc.
Tandy Brands Accessories, Inc. designs, manufactures and markets fashion accessories for men, women and children. Key product categories include belts, wallets, handbags, suspenders, socks, scarves, neckwear, gifts, sporting goods, and cold weather and hair accessories. Merchandise is sold under various national brand names as well as private labels to all major levels of retail distribution, including the ROLFS e-commerce web site atwww.rolfs.net.

Safe Harbor Language
Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause the Company’s actual results in future periods to differ materially from forecasted or expected results. Those risks include, among other things, the competitive environment in the industry in general and in the Company’s specific market areas, inflation, changes in costs of goods and services and economic conditions in general and in the Company’s specific market area. Those and other risks are more fully described in the Company’s filings with the Securities and Exchange Commission.

(Tables to follow)

TANDY BRANDS ACCESSORIES, INC.
Condensed Consolidated Statements of Income
(In thousands, except per share amounts)
(Unaudited)

	Three Months Ended						Six Months Ended
	December 31,						December 31,
	2004			2003			2004			2003
Net sales	$	73,990		$	64,159		$	134,463		$	128,391
Cost of goods sold		45,958			42,078			84,372			84,680
Gross margin		28,032			22,081			50,091			43,711
Selling, general and administrative expenses		19,486			14,055			35,720			29,265
Depreciation and amortization		1,222			1,020			2,320			2,058
Total operating expenses		20,708			15,075			38,040			31,323
Operating income		7,324			7,006			12,051			12,388
Interest expense		(402	)		(677	)		(658	)		(1,370	)
Royalty, interest and other income		76			29			167			31
Income before provision for income taxes		6,998			6,358			11,560			11,049
Provision for income taxes		2,707			2,449			4,455			4,295
Net income	$	4,291		$	3,909		$	7,105		$	6,754
Earnings per common share:	$	0.68		$	0.63		$	1.13		$	1.10
Earnings per common share-assuming dilution:	$	0.65		$	0.61		$	1.09		$	1.07
Dividends declared per share	$	0.0275		$	.0250		$	0.0550		$	.0500
Common shares outstanding		6,315			6,207			6,289			6,157
Common shares outstanding shares-assuming dilution		6,585			6,399			6,537			6,336

TANDY BRANDS ACCESSORIES, INC.
Condensed Consolidated Balance Sheets
(In thousands)

	December 31,			June 30,
	2004			2004
ASSETS	(Unaudited)			(Unaudited)
Current assets:
Cash and cash equivalents	$	3,129		$	6,086
Accounts receivable, net		47,715			33,427
Inventories		60,050			57,086
Deferred income taxes		5,209			4,009
Other current assets		1,685			1,613
Total current assets		117,788			102,221
Property, plant and equipment, at cost:
Property and equipment, at cost		36,566			34,581
Accumulated depreciation		(21,982	)		(20,206	)
Net property, plant and equipment		14,584			14,375
Goodwill, net of accumulated amortization		18,398			11,655
Other intangibles, less amortization		6,280			4,534
Supplemental Executive Retirement Plan intangible asset		1,255			1,255
Other noncurrent assets		1,710			1,534
TOTAL ASSETS	$	160,015		$	135,574
LIABILITIES & STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable	$	10,349		$	14,224
Accrued expenses		10,425			6,362
Total current liabilities		20,774			20,586
Notes payable		24,482			10,000
Deferred income taxes		2,916			2,066
Supplemental Executive Retirement Plan liability		1,378			1,721
Other noncurrent liabilities		1,784			1,302
Total liabilities		51,334			35,675
Stockholders’ equity:
Common stock		6,459			6,306
Additional paid-in capital		28,194			26,765
Cumulative other comprehensive income (loss)		471			(121	)
Shares held by Benefit Restoration Plan Trust		(1,036	)		(894	)
Retained earnings		74,593			67,843
Total stockholders’ equity		108,681			99,899
TOTAL LIABILITIES & STOCKHOLDERS’ EQUITY	$	160,015		$	135,574

TANDY BRANDS ACCESSORIES, INC.
Reconciliation of Adjusted Earnings
(In thousands, except per share amounts)
(Unaudited)

	Three Months		Six Months
	Ended		Ended
	December 31,		December 31,
	2004		2004
Net income, as reported	$	4,291	$	7,105
Adjustments, net of tax:
Pending settlement of legal matter		417		417
Adjusted earnings	$	4,708	$	7,522
Adjusted earnings per share assuming dilution	$	0.71	$	1.15