TANDYCRAFTS, INC. REPORTS SIGNIFICANTLY IMPROVED
FOURTH QUARTER RESULTS
Fort Worth, Texas. August 13, 1996 -- TANDYCRAFTS, INC. (NYSE: TAC)
announced today significantly improved results for its fiscal fourth quarter
ended June 30, 1996. Net income for the quarter was $1,297,000, or $0.11 per
share compared to a net income of $122,000 or $0.01 per share for the same
quarter of fiscal 1995. Net sales were $64,032,000, a 5.8% increase compared to
the $60,501,000 reported for the comparable period last year. Total retail sales
for the quarter increased 3.8% while manufacturing sales for the quarter
increased 7.6% when compared to the same period last year.
In commenting on the Company's performance, R. Earl Cox III, Chairman,
stated "We are pleased with the progress of the Company to date. The strategic
restructuring program initiated in December 1995 is substantially complete and
the many changes that have taken place in the past few months are beginning to
show positive results. This is the second consecutive quarter with
significantly improved earnings over the same quarter last year. Excluding the
results of operations targeted for divestiture as part of the Company's
strategic restructuring program, operating income for the fourth quarter
increased 78.3% to $3,155,000 and net sales increased 12.8% to $62,345,000
compared to the same quarter last year. While we are encouraged by the results
thus far, there is still work to be done to achieve the level of performance
that we expect from various units. The successful execution of the strategic
restructuring program will enable management to better focus their attention on
the remaining core business units. We believe that the company is headed in the
right direction and look forward to continuing this positive trend in fiscal
1997."
For the twelve months ended June 30, 1996, net sales were $254,284,000, a
decrease of less than 1% when compared to the $256,523,000 reported for the
comparable period of the prior year. The net loss for the twelve months ended
June 30, 1996 was $(10,709,000), or $(0.89) per share as compared to net income
of $5,217,000, or $0.46 per share for the corresponding period of the prior
fiscal year. The Company's earnings for the twelve-month period ended June 30,
1996 reflect a $12.3 million charge, net of income taxes, or $1.03 per share,
associated with a strategic restructuring program.
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 Discount Office Supplies. The
Specialty Manufacturing segment is comprised of two manufacturing divisions:
Frames and Framed Art and Tandy Wholesale International ("TWI"). Information
disclosed in this news release which are forward-looking statements involve
risks and uncertainites 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 Tandycraft's most recent Form 10-Q and 10-K.
(Table to follow)
Three Months Ended Twelve Months Ended
--------------------- ----------------------
June 30, June 30, June 30, June 30,
1996 1995 1996 1995
---------- ---------- ---------- ----------
(In thousands, except per share amounts)
Net sales $ 64,032 $ 60,501 $ 254,284 $ 256,523
Operating costs and expenses:
Cost of goods sold 40,853 38,110 160,385 155,644
Selling, general and
administrative 19,065 19,754 81,427 83,544
Restructuring charge - - 18,317 -
Depreciation and
amortization 1,244 1,454 5,966 5,475
---------- ---------- ---------- ----------
Total operating costs
and expenses 61,162 59,318 266,095 244,663
---------- ---------- ---------- ----------
Operating income (loss) 2,870 1,183 (11,811) 11,860
Interest expense, net 874 1,056 4,072 3,833
---------- ---------- ---------- ----------
Income (loss) before
income taxes 1,996 127 (15,883) 8,027
Provision (benefit) for
income taxes 699 5 (5,174) 2,810
---------- ---------- ---------- ----------
Net income (loss) $ 1,297 $ 122 $ (10,709) $ 5,217
========== ========== ========== ==========
Net income (loss)
per share $ .11 $ 0.01 $ (0.89) $ 0.46
========== ========== ========== ==========
Weighted average common and
common equivalent shares 12,123 11,642 11,983 11,434
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