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Tandy Brands to cease manufacturing opts at Texas facility

24 Apr '07

2 min read

Tandy Brands Accessories Inc announced financial results for the third quarter ended March 31, 2007.

For the third quarter of fiscal 2007, net sales decreased 16.5% to $37.9 million compared to $45.4 million for the same period last year.

Gross profit margin increased 18.5 percentage points to 35.9% compared to 17.4% in the prior year period. The Company reported a net loss of $1.4 million, or ($0.21) per diluted share, compared to a net loss of $5.9 million, or ($0.89) per diluted share, in the prior year third quarter.

J.S.B. Jenkins, President and Chief Executive Officer commented, "Our results for the third quarter were within expectations with respect to decreased revenues along with improvement to our gross margin."

"The significant increase to our gross margin was a result of our previously announced exit from several women's accessories categories, which resulted in a charge of $6.9 million in the prior year third quarter, as well as our continued efforts to improve our overall distribution."

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The Company also announced that it will discontinue its belt manufacturing operations at the Company's Yoakum, Texas facility.

The Company will retain the facility and convert it into a receiving and distribution facility. The belts currently produced at the 60,000 square foot facility are expected to transition to manufacturing facilities overseas.

The Company expects to conclude the majority of its manufacturing operations by June 30, 2007, and does not expect to incur any impairment charges related to property and equipment in this facility. This move is expected to result in increased cost savings for the Company in fiscal 2008.

Tandy Brands Accessories Inc

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