For the year, Wholesale Leathercraft's sales were down $1.1 million, or 4%. Same store sales decreased $1.2 million, or 5%, while sales to national accounts were down $564,000, or 1%, for the year. Mid-Continent Leather Sales added sales of $720,000 for the year.
Consolidated gross profit margin for the fourth quarter was 57.8%, a decline from 58.8% for the fourth quarter of 2006. For 2007, consolidated gross profit margin was 57.3%, equal to that of the previous year's gross profit margin.
Consolidated operating expenses for the fourth quarter of 2007 were 45.8% of sales, increasing from 44.9% for the same quarter of 2006. Operating expenses totaled 49.1% of sales for 2007, increasing from 44.5% for 2006.
Ron Morgan, Chief Executive Officer and President, commented, "As are many retailers, we are glad to have 2007 behind us and are looking forward to the challenges that will be part of 2008. We made great strides in containing our operating expenses in the fourth quarter - up approximately 1/2 of one percent compared to the fourth quarter of 2006.
Considering we have ten more stores now than we had then, I think the minimal increase in operating expenses is even more of an accomplishment than it first appears. As a result, we are reiterating our 2008 guidance of $56 million in revenue and 28 cents in fully-diluted EPS."
Shannon Greene, Chief Financial Officer and Treasurer, added, "While 2007 was not a great year for us, there are some achievements worth mentioning: We met our 2007 earnings guidance of 28 cents per share. 2007 was our eleventh consecutive year of operating profitability. We ended the year with more cash in the bank than we started with and our cash balance grew by more than 80% in the fourth quarter.
Our inventory grew by only 2% from the end of 2006 to the end of 2007 and decreased by 15% in the fourth quarter. If you eliminate the inventory in the ten new stores we opened this year, our inventory would be down by 2% compared to the end of 2006."
Tandy Leather Factory Inc
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