Note 7 - Segment Information

6 Months Ended

Jun. 30, 2016

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

7.

SEGMENT INFORMATION

We identify our segments based on the activities of three distinct operations:

a. Wholesale Leathercraft, which consists of a chain of wholesale stores operating under the name, The Leather Factory , located in North America;

b. Retail Leathercraft, which consists of a chain of retail stores operating under the name, Tandy Leather Company , located in North America; and

c. International Leathercraft , which sells to both wholesale and retail customers. We have four stores operating in this segment: one in Northampton, United Kingdom; one in Manchester, United Kingdom (which opened in October 2015); one in Sydney, Australia; and one in Jerez, Spain. These stores carry the same products as our North American stores.

Our reportable operating segments have been determined as separately identifiable business units, and we measure segment earnings as operating earnings, defined as income before interest and income taxes.

	Wholesale Leathercraft			Retail Leathercraft		Int’l Leathercraft			Total
For the quarter ended June 30 , 20 16
Net sales	$	6,064,995		$	12,493,943	$	963,967		$	19,522,905
Gross profit		4,790,539			7,364,772		740,479			12,895,790
Income from operations		1,548,303			1,166,009		124,579			2,838,891
Interest (expense)		(42,027	)		-		-			(42,027	)
Other income (expense), net		8,986			-		14,448			23,434
Income before income taxes		1,515,262			1,166,009		139,027			2,820,298
Depreciation and amortization		222,090			152,217		43,258			417,565
Fixed asset additions		213,692			28,543		48,840			291,075
Total assets	$	45,695,555		$	16,124,992	$	4,797,768		$	66,618,315
For the quarter ended June 30 , 20 15
Net sales	$	6,394,278		$	12,532,411	$	846,839		$	19,773,528
Gross profit		4,726,907			7,548,859		538,615			12,814,381
Income from operations		968,552			1,336,669		28,621			2,333,842
Interest (expense)		(34,762	)		-		-			(34,762	)
Other income (expense), net		25,769			-		(15,892	)		9,877
Income before income taxes		959,559			1,336,669		12,729			2,308,957
Depreciation and amortization		274,536			137,735		13,249			425,520
Fixed asset additions		164,540			226,777		19,470			410,787
Total assets	$	38,507,395		$	20,875,591	$	4,186,980		$	63,569,966
For the six months ended June 30, 201 6
Net sales	$	12,561,902		$	25,736,527	$	1,896,703		$	40,195,132
Gross profit		9,179,168			15,060,951		1,308,417			25,548,536
Operating earnings		2,674,562			2,380,959		146,160			5,201,681
Interest (expense)		(65,456	)		-		-			(65,456	)
Other income (expense), net		14,733			-		8,662			23,395
Income before income taxes		2,623,839			2,380,959		154,822			5,159,620
Depreciation and amortization		484,625			303,910		43,258			831,793
Fixed asset additions		584,991			260,108		52,908			898,007
Total assets	$	45,695,555		$	16,124,992	$	4,797,768		$	66,618,315
For the six months ended June 30, 201 5
Net sales	$	13,119,582		$	25,641,824	$	1,800,886		$	40,562,292
Gross profit		8,896,542			15,394,625		1,106,142			25,397,309
Operating earnings		1,920,407			2,740,121		62,195			4,722,723
Interest expense		(78,925	)		-		-			(78,925	)
Other income (expense), net		37,162			-		(7,412	)		29,750
Income before income taxes		1,878,644			2,740,121		54,783			4,673,548
Depreciation and amortization		514,254			270,597		24,605			809,456
Fixed asset additions		584,446			484,315		19,470			1,088,231
Total assets	$	38,507,395		$	20,875,591	$	4,186,980		$	63,569,966

Net sales for geographic areas were as follows for the three and six months ended June 30:

Three months ended June 30,	20 16		20 15
United States	$	16,610,634	$	16,836,732
Canada		1,746,547		1,852,181
All other countries		1,165,724		1,084,615
	$	19,522,905	$	19,773,528

Six months ended June 30,	2016		20 15
United States	$	34,338,263	$	34,585,363
Canada		3,488,303		3,738,766
All other countries		2,368,566		2,238,163
	$	40,195,132	$	40,562,292

Geographic sales information is based on the location of the customer. No single foreign country, except for Canada, accounted for any material amount of our consolidated net sales for the three and sixmonth periods ended June 30, 2016 and 2015. We do not have any significant long-lived assets outside of the United States.