Company Profile

The Leather Factory, Inc. ("TLF"), headquartered in Fort Worth, Texas, is the premier distributor of leather and leathercraft products to customers worldwide. Products are distributed primarily through 28 sales units located in 19 states and Canada. The purchase of Tandy Leather Company in December 2000 increased its market share and distribution capabilities with a dedicated mail-order system and sophisticated e-commerce website as well as the elimination of TLF's major competitor.

The Leather Factory, Inc. was founded in 1980 by Wray Thompson and Ronald Morgan who, at that time, had a combined 32 years experience in the industry. Its primary product was leatherworking tools. As the company has grown from its original six sales units (still in existence today) to the current 28, the product line has grown from 800 to approximately 2,800 items. One of the company's greatest strengths is the diversity of its product line. The selection of items cannot be found anywhere else under one roof. Roberts, Cushman & Company, Inc., a subsidiary of TLF located in New York, custom designs and manufactures a related product line of decorative hat trims for hat (usually western) manufacturers. Royal Crown Custom Leathers, a division of TLF, distributes small finished leather goods such as cigar cases, wallets and western accessories.

The aggressive use of direct mail advertising has been a contributing factor in TLF's success. They maintain an extensive customer mailing list that enables them to target specific customer groups with relevant mailing pieces. On average, they produce 80-100 different mailing pieces annually that are distributed to 65,000+ customers.

Revenues for its latest fiscal year ended December 31, 2000 were $30.1 million with net income of $1.5 million. Shareholders equity as June 30, 2001 stood at $11.5 million.