OREANDA-NEWS. Tandy Leather Factory, Inc. (NASDAQ:TLF) today reported financial results for the first quarter of 2016.  Net income for the quarter ended March 31, 2016 was $1.5 million, up 5% from net income in the first quarter of 2015 of $1.4 million.  Fully-diluted earnings per share for the quarter were $0.16 in the current quarter, compared to $0.14 in last year’s first quarter, up 14%.  Total sales for the first quarter were $20.7 million, a decrease of 0.6% compared to 2015’s first quarter sales of $20.8 million.

Sales from the Retail Leathercraft division, consisting of the Tandy Leather store chain, increased $133,000 in the first quarter, up 1% from last year's first quarter sales.  The store chain consisted of eighty two stores as of March 31, 2016 and 2015.  First quarter sales for the Wholesale Leathercraft division decreased $228,000 or 3% from the same quarter last year.  International Leathercraft, consisting of four stores outside of North America, added sales of $933,000 for the quarter, a 2% decrease from last year’s first quarter sales of $954,000.

Consolidated gross profit margin increased from 60.5% in the first quarter of 2015 to 61.2% in the first quarter of 2016.  Operating expenses increased $96,000 in the first quarter of 2016 to $10.3 million compared to $10.2 million in the first quarter of 2015, increasing as a percentage of sales from 49.0% in 2015 to 49.8% in 2016.  Compared to the first quarter of 2015, employee benefits, legal and professional fees, rent and licenses and fees were the primary contributors to the operating expense increase, offset somewhat by decreases in freight out and store personnel bonuses.        

Shannon L Greene, interim Chief Executive Officer, commented, “We are fairly pleased with our results in the first quarter.  Sales are soft and we expect that to continue all year.  We know the lackluster retail environment can impact our sales because of cautious consumer spending, but we also know it is our job to manage the business through periods like this.  As a result, we are defining success in 2016 as protecting gross profit margins and controlling expenses.”  

Mark Angus, interim President, added, “Although we are off to a respectable start in 2016, we recognize the importance of continued focus on solid margins.  We have instituted several initiatives that should contribute to supporting and strengthening margins but we suspect it will take several quarters before we begin to see the effects.”