TLF - Earnings call 2 2023 | Tandy Leather Factory, Inc.

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Daniel Ross

Good morning, everyone. Thank you for joining us for a discussion of Tandy's Second Quarter 2023 financial results. I'm Dan Ross, General Counsel and Corporate Secretary for Tandy, and I will be collaborating the discussion today.

Our CEO, Janet Carr, will give just a very brief overview of the quarter, and then we will devote the conference to investors' questions and discussion.

[Operator Instructions] With that, let's get started. Act statements the historical Act meaning and Securities include forward-looking that of will as the within each statements of Exchange presentation other results than constitute XXXX amended. Today's XXXX, of the Securities These the we statements guarantees predictions have on performance. not information of are reflect future or but based expectations or our estimates today, the which involve statements differ are beyond which known many factors, of to presentation. this and They in results control, contained unknown may and other materially actual risks, from uncertainties and cause our

You forward-looking are is here revise required no update not on cautioned as to put now otherwise statements. obligation Janet reliance undue Carr. or these these except law. And assumes forward-looking statements The company by to

Janet Carr

just crosstalk think bit Hi, a little because here. getting everyone. going you I ask I'm we're of to Dan to all mute

joining for Thanks today. us

As a Dan of the overview quarter. brief said, very just

said came closed year. for to last release, as from discussing the down in down X% -- as sales we've expense quarters. came million, our continued last Our last consumer was our to XX% we press at our in weaker Operating been filings response [indiscernible] and a due $XX.X weaker of versus and QX promotions in several year stores, demand,

$XXX,XXX in $XXX,XXX our we down for or good million driving our -- we QX of and versus profitability. And managing So accordingly, $XX million, general, up comments. and a And million and versus control and driving at questions last year. expenses see our with year-end in $XX.X $X.X goal was profitability. Cash QX QX. year-end was year. sales, about about operating million getting open that, do despite weakening you loss last are or million, of traction versus of down us feel versus last $X X.X% on $XXX,XXX And getting Inventory of operating expenses from income $X.X came

Unknown Analyst

Can you hear me, Janet?

Janet Carr

Yes.

Unknown Analyst

capital that store York store the was to talk and the sort about invested compares the others? how and little of bit Can the New it into a City you of some

Janet Carr

York with space. feet, on about New community, small virtually new no have with a in almost more makers' us in store traction. addition small making store a that's We including with square the word crafting for is have our to that It's we connections side. a stores. New is and implemented already approaches entirely much for big have flow merchandising But of allow to of X,XXX lot has leather That store X,XXX fashion in the traffic, the good product director more condensed And to visual City is the a Yes, which got already having good our big community mouth. classes of lot marketing York. based space

significantly have it the of contracts an I is don't on but spent build-out, by exact in have locations, than York other store New what we higher driven cost general area. the primarily in number more the

$XXX,XXX. say, but this and build-out So to that come as $XX,XXX it's so twice store mind be average our may between in much, keeping is store going in about about $XX,XXX

able not And where So months XX more. XX -- be our super we'll it trending it's we're things, see look investment. on we the that of in store a concerned about store to to return low. the may And But of that. Andrew? cash-on-cash far, scheme so is given whole for be return this

Unknown Analyst

going and call relative down to, Sales could or little on about the stores. you unit let's X% down I the on Great wondering job inflation profitability. XX%. how by And the more the units units inflation was up your are environment and of I think should elaborate X% trending are right. on it, item. if sales All a what's is in how

Janet Carr

have it, will don't for math that do ask of and math. team to the you my but do some can't I I in I that head,

have very In price we We given necessary that's our price that is have increases consumer. limiting versus about what aggregate, price-sensitive to increases overall, X of absolutely and but a average XX% and been how off we're gradually happening out seeing my been can't head. at top you an various averages units across that I tell the of ago, unit years exactly retail,

result Point think well, tell price we I because being, of tell of pricing. sales have absorbed the the is maintain well, decline some to -- decline try speaking, We've those to possible can -- prices. I'll done everything I'm in not don't vendors. other switched generally in sure that you, I sales you a We to increasing

crux -- so. So think is are raised the price? you've because down if sales answer you're we don't is, if of question your The

regular that long-term strategy we're make not were been seeing that we're to that's good the see likely to overall retails retail, case, greater And then expect people continue more people and would our responsive increasing, day. buy regular our and would providing more are we that promotions. If We're is to sure every value at be responsiveness promotions, to to seeing either.

saying, but from as And there I'm lots of XX%, getting team yes, well. our about questions are notes mix

Abigail?

Unknown Analyst

improvement do talk is your structure bit down, you've cost to it more get about This be you what like a operating best done reductions? what already reduce costs, or gross or little you whether the Can opportunities margin Abigail. to can cost

Janet Carr

Yes.

and market of pressures is an competitive minimum for and more of said, That number is especially the And -- more of both. in take on biggest in down. the to some people the roles. very the is store retail has opportunity have pay costs we have more. opportunity tight, been From The for labor a we that there's in bucket increasing. is market wage opportunity because we we've pay cost these are labor hours labor. been perspective, to lot have we a store reduce that In store have have and kinds think challenge places, an to hours, some initiative I working become to just cases, that

times, than and a having employees, toward in full-time having rules X employee past us in we of the are more that of lot are and a and we times had periods more day can and store all there -- store. moving are We've there when part-time think are operate had stores small the more X flexibility. more to give certain enough days employees at about We've the employee

we at the ways of to back improve at overall, of So kinds time, we looking to will some employees them and that per all we hours that have of the do more and paying pay while the -- hour. reduce have give same know effectiveness

the We did biggest freight-in they're Asia. margin side. below I see down gross single about we the a to for in don't container, at especially perspective, most from now back talking improvements a is $X,XXX that shipments So opportunity. From $XX,XXX work the part, and in cost, a cargo to container XXXX, we know, coming continue sourcing were

continue a sourcing here there away got quite we've against margin. to year. and pressure, dollar the of weak from Mexico, relative we at gross where places peso the to time, lot At the last whittle So been it's the over where same like especially is feeling opportunity the are to Mexican

there are And keeping biggest. the lower this to have where selectively all giant trying -- sharp is especially it's to eye can. price sensitivity there are we are like we where we take I and competitors, say feel we our like act, juggling So on

offering are That sure we good everyday So price make that there take said, are categories can more where always retails we're to and that promotional. competitive. some be want we

So millions well. margins gross always that the to as to juggling we're try in this variables of drive higher

Unknown Analyst

going can talk maybe guess you just question, opportunity a forward. biggest your about a revenue follow-up growth as I guide And more bit little to

Janet Carr

Revenue an growth, as opportunity trending really Yes. cash know, to positive. you -- of we over negative and and flow number that get were to have closed the last we year, a didn't stores cash down

are where XX had closed the the X we're leases opportunity we to for weren't stores a so during flow geography we during we are U.S. we including the And some time. lots where that leather that we positive up, like operate is were layer X a covering, And that geographies that negotiate, across closed XX the landlords locations crafters for closed not stores stores. during sales months closed spread or growth thin lot sort were finding of in of can cash there's the #X of stores store COVID all where or COVID, and There willing

those said, going And and find we we're we of some And locations find now come back store and of a actively working are out got to better location. to locations.

of out Part New and us. assortment stores. improve also on that for we're to in ability York store lower smaller make experiment kinds positive allows drive a smaller the full us and that a to of work think that to I footage get square work the of the in cash with locations spaces rent clear is these

that's pursuing. the that #X opportunity actively So we're

of focused are jillion community out, lot got to sort us new focus able including and of of engagement. and underneath a improvements, youth that coming veterans a other, there, We've around initiative being lines focus lots on youth engagement, a lots kits, remain have as especially for we of big product classes, initiatives other product community have veterans

be list long right a is stores now. the #X it's that we thing So things, doing can of but new

Unknown Analyst

And mind. I just more That's it. helpful. X Got don't if have you question,

are next cash the excellent you year generation touched but flow can year? continue an are? think of Do it, flow on you kind puts and cash kind this free takes of that year-to-date. generate And had You and what you free to of into

Janet Carr

that's goal. quarter cash timing. end little Yes, The big of the of bump the in at is that just a the fact bit this is

product and Some payments receipts. product

forward. continue expect going don't see at single every I that to that So quarter rate

our just point December Friday promotions. QX As the low is you a in year Black know, and big QX the before

And our progress and to we're to to So that. cash -- it we're against continue that positive continue pleased is to making grow to drive goal it. but see

Sure. Andrew,

Unknown Analyst

you what store of about right seeing Last is talk you environment a in existing now? hiring the manager with how that? And are question little turnover the managers is, labor, store can kind

Janet Carr

honest today, turnover Yes. stable, especially number what of talent you do we of tight, openings. you. it's It's manager my as and tell with I'll totally improve been the top quality have be number It's there. we our Labor environment a retail. I we out a involuntary pool, is voluntary at retail is the although head continue of tough. relatively have can't a both store but and of to off in tough

that be advantage. excellent flip labor But competitive tight that try especially challenging XXX the maintain stores, discipline an cost. to when around and are that Retail in service to environment is side have in a environment of looking and you stores a we're create to can

#X it's for the hiring environment tough a is good lot to opportunity a still. store continue and more retailers, to And anything managers. can't it recruit our say importantly, So than retain of

Daniel Ross

Instructions] [Operator

Unknown Analyst

to difficult do. just ask I'll assuming buybacks management. more, X sort overall just cash or I'm the given of are liquidity

maybe So to briefly all could as up that. of cash balance bit, that and the how now as interest on that getting you sort being the little just is cash comment back well managed a is

Janet Carr

We our in that buyback do north our And delivering, have ladder program, with it. are as program nice. how of something we every been we you discussion, X%. And considers we and using capital a know, undeployed I Board the balance That's Yes. of that cash. operating, our think T-bill in is don't and yields know, T-bills place for and deploy it's how the about

volume can place, speak this, So that of the buy limitations regulations my can there but Dan trades are ins the to of outs the the programs you is I to in of don't given more frankly, buyback every understanding day. this how -- and that much probably

we that program. buyback But I is be given have so to probably well limited going amount mean reality. that as trading can limited that's And volume, under the always and we the that just pretty

operating. is and the turned program However, on

Board is to now. So that committed the doing for

on You reach to Investor out can always us Relations.

I our e-mail is press my on actually releases. think

chat do for from and that happy on to with of if you get that's conversations happy appreciate I'm you I to us. well. think taking occasionally later, the can public, of something about some time have your And So interest. you those thank and you hear chat we all as Really

Dan? else. nothing There's

Daniel Ross

Okay. Thank the joining today. meeting you all for

Janet Carr

Bye. Thanks,

Tandy Leather Factory (TLF) 16 Aug 232023 Q2 Earnings call transcript