Tandy Leather Reports Decline in Sales and Profitability for Fiscal Year 2024

Tandy Leather Factory, Inc. reported a decline in financial performance for the fiscal year ending December 31, 2024, with consolidated net sales of $74.4 million, a decrease of 2.4% from $76.2 million in 2023. The company's gross profit also fell by 7.4%, from $45.2 million to $41.8 million, resulting in a gross margin percentage of 56.2%, down from 59.2% the previous year. Operating income saw a significant drop of 85.8%, falling to $628,000 from $4.4 million in 2023. The decrease in sales and profitability was attributed to ongoing weak consumer demand and increased operational costs, particularly in freight and warehouse overhead.

In terms of strategic developments, Tandy Leather closed two stores and opened one during the year, maintaining a total of 101 retail locations, including 91 in the U.S., 9 in Canada, and one in Spain. The company also completed the sale of its corporate headquarters and distribution facilities in Fort Worth, Texas, for $26.5 million in January 2025, and signed a 10-year lease for new headquarters in Benbrook, Texas. Additionally, Tandy appointed Johan Hedberg as the new CEO, succeeding Janet Carr, who resigned in early January 2025.

Operationally, Tandy Leather employed 542 individuals as of December 31, 2024, with 414 in full-time positions. The company continues to focus on enhancing customer engagement through in-store classes and workshops, which are seen as vital to driving foot traffic and sales. The company’s inventory decreased to $35.6 million from $38 million in 2023, reflecting a strategic effort to manage stock levels amid fluctuating consumer demand. Tandy's customer base includes both retail and commercial customers, with no single customer accounting for more than 0.5% of total revenues.

Looking ahead, Tandy Leather aims to strengthen its sales by leveraging its retail store network and improving employee product knowledge and customer service. The company acknowledges the challenges posed by macroeconomic factors, including inflation and geopolitical tensions, which have affected consumer discretionary spending. Tandy anticipates that its financial performance will depend on various factors, including consumer preferences and the successful execution of its business strategy, particularly in light of the ongoing economic uncertainties.