UNITED STATES
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 (Date of earliest event reported:)
August 17, 2022


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)

1900 Southeast Loop 820, Fort Worth, Texas

76140
(Address of Principal Executive Offices)

(Zip Code)

(817) 872-3200
(Registrant's Telephone Number, Including Area Code)

 
(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):


Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class
Trading Symbol(s)
Name of each exchange on which registered
Common Stock, par value $0.0024
TLFA
Over-the-counter “pink sheets”

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
 
Emerging growth company 
 
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐



Item 2.02.
Results of Operations and Financial Condition

On August 17, 2022, Tandy Leather Factory, Inc. (the “Company”) hosted a web-based presentation, which was previously announced by the Company’s press release dated August 10, 2022.  The investor presentation includes certain information not previously announced regarding the Company’s balance sheet and historical performance, as well as certain projections for future performance.  A copy of the presentation materials is attached as Exhibit 99.1.

The information furnished pursuant to Item 2.02 of this report and the exhibits attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 as amended (the “Exchange Act”, or otherwise subject to liabilities under that section, nor shall they be deemed incorporated by reference in any filing of the Company with the Securities and Exchange Commission under the Exchange Act or the Securities Act of 1933, as amended (the “Securities Act”), whether made before or after the date hereof, except as shall be expressly set forth by specific reference in such filing.

Item 9.01
Financial Statements and Exhibits.

(d)
Exhibits

 
No.
Exhibit
 
Investor Presentation Materials dated August 17, 2022

Forward Looking Statements

Certain statements contained in this report and other materials the Company files with the SEC, as well as information included in oral statements or other written statements made or to be made by the Company, other than statements of historical fact, are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements generally are accompanied by words such as “may,” “will,” “could,” “should,” “anticipate,” “believe,” “budgeted,” “expect,” “intend,” “plan,” “project,” “potential,” “estimate,” “continue,” “outlook,” “forecast” or “future,” variations thereof or other similar statements. Please refer to the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2018 for additional information concerning these and other uncertainties that could negatively impact the Company. The Company assumes no obligation to update or otherwise revise its forward-looking statements, except as required by law.


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 by the undersigned hereunto duly authorized.
 

TANDY LEATHER FACTORY, INC.



Date:  August 17, 2022
By:
/s/ Michael Galvan


Michael Galvan, Chief Financial Officer




Exhibit 99.1
 Q2 2022  MANAGEMENT DISCUSSION OF FINANCIAL RESULTS 
 

 2  Today’s presentation will include statements, other than historical results, that constitute forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934, each as amended.  These statements reflect our expectations or estimates based on the information we have today but are not guarantees or predictions of future performance.  They involve known and unknown risks, uncertainties and other factors, many of which are beyond our control, and which may cause actual results to differ materially from the statements contained in this presentation.  You are cautioned not to put undue reliance on these forward-looking statements.  The Company assumes no obligation to update or otherwise revise these forward-looking statements, except as required by law.  FORWARD-LOOKING STATEMENTS 
 

 3  Financial Snapshot – 2022 Q2  2022  SALES  GROSS MARGIN  PROFIT  BALANCE SHEET  SHARE BUY-BACKS  $18.4MM  (0.8%) vs 2021  57.0%  ($0.7MM) operating loss  ($0.1MM) adjusted EBITDA(1)  $5.6MM cash  $40.1MM inventory  no debt  360k shares  4.2% of total shares  $5.00 average price per share  Year-to-date  $38.9MM  (2.6%) vs 2021  57.7%  $0.1MM operating income  $1.5MM adjusted EBITDA(1) 
 

 4  Sales  Q2 2022  2022 Q2 sales were down less than 1% versus Q2 of 2021, an improvement in trend over the first quarter. However, the retail environment remains challenging.  (0.8%)  (2.6%)  RETAIL  ECOMMERCE  COMMERCIAL  73%  19%  8%  73%  20%  7% 
 

 5  Gross Profit  Q2 2022  Q2 gross profit came in 6.9% below Q2 of 2021 due to slightly lower sales and significantly lower margin rate.   (6.9%)  (4.4%) 
 

 6  Profitability  Q2 2022  Profitability in 2022 has been affected by soft sales, gross margin impacts, and higher operating costs associated mostly with the tight labor market. 
 

 7  Since 1919, Tandy Leather has been the leading supplier of quality leather, machines, tools, kits and instructional resources for generations of hobbyists and trade craftspeople making a living selling leatherwork.  Tandy Highlights  LARGE & GROWING MARKET  MARKET LEADER  MULTI-CHANNEL DISTRIBUTION  CAPABLE TEAM  STRONG FINANCIAL POSITION  $40B global craft market  $500MM leathercrafting market  Growing at 8%  17% share in fragmented market  Heritage brand  104* Retail Stores  Global Ecommerce  Commercial Division  Transformed business  Completed restatement  Managed through COVID  Long-term plan to $100MM+/$15MM  $5.6MM net cash  $40MM inventory  $13-15MM real estate  No debt  *July 2022 
 

 8  We have a roadmap to $100MM+ in sales and $15MM in operating income – and we have a plan to get there.  Future Roadmap  CORE BUSINESS  FOCUS ON TEACHING  PILOT NEW FORMATS  GROW COMMERCIAL  @projectfree2fly  PRODUCT IMPROVEMENTS  @legacybrandleather  OPTIMIZE RETAIL FLEET  @powderriverleather  NEW OPPORTUNITIES  YOUTH CRAFTING  ART THERAPY  CHAIN WHOLESALE  INTERNATIONAL  4 KEY GROWTH INITATIVES  Tandy is positioned to bring new customers into the craft and expand the leathercrafting category. 
 

 9  Key Principles  Disciplined Capital Allocation  Conservative Balance Sheet  Focus on Long-Term Shareholder Value  Financial  Focus on Consumer Proposition  Build Durable Business Foundation  Remain Nimble  Operating 
 

 10  Questions & Discussion 
 

 11  (1)Non-GAAP Reconciliation  @duckandchick