Baystreet Staff -

Stonegate Capital Partners Updates Coverage on Talon International, Inc. (OTCQB: TALN)


DALLAS, TX / ACCESSWIRE / December 6, 2017 / Talon International, Inc. (OTCQB: TALN):


Talon International, Inc. is a leading supplier of customized zippers and apparel accessories. Talon International has a globally recognized brand backed by 120 years of experience in the industry. The company is responsible for the invention of the sliding zipper device. Talon's product mix is composed of two main categories: zippers and managed trim solutions (i.e. woven & printed labels, buttons & rivets, printed marketing, zippers, thread as well as any other types of trim or accessory products), including Tekfit Stretch Technology™. Tekfit® has exclusive rights to advanced fabric technologies that facilitate the addition of mechanical stretch into most standard fabrics. There are numerous applications, including waistbands that have the ability to stretch out and back, without the need to add costly and unsightly elastics or other components. Talon is headquartered in Woodland Hills, California, a northern suburb of Los Angeles, and currently employs 201 full time employees, including 30 in the United States and 171 in Asia.


Talon plans to capture continuing growth via its integrated business model that provides clients with a "one-stop shop" for their zipper and trim needs. By operating as a fully integrated, single source supplier for its clients, Talon can save clients time and expenses. Furthermore, by leveraging its decades of experience and expertise in engineering, sourcing, manufacturing and assembly, Talon has positioned itself to effectively compete in a highly fragmented industry. The company's ability to deliver superior products, unmatched customer service, and leading customization capabilities is what sets Talon apart from its peers.

  • The company has emerged from a multi-year restructuring effort and recent recapitalization that has enhanced its financial flexibility and set the stage for growth; results for FY16 included revenues remaining steady at $48.3M, with gross margins increasing to 36.5% vs. 33.7% in FY15 and net income increasing to $995K vs. $511K in the prior year. Most recently, Q317 saw lower revenues of 9.8% Y-O-Y with both trim and zipper segments seeing decreased sales to mass merchandising brand customers and specialty retail brand customers. Gross profit percentage was comparable Q317 vs. Q316 at ~35%, and net income for the current quarter was ($78K) vs. $21K for Q316.
  • Talon plans to capitalize on a highly fragmented marketplace where major brands/retailers typically have a large number of suppliers spread across the globe from which they obtain their required components. Creating stickier clients with whom they can become a proven supplier helps insulate Talon's clients from the pricing pressures of larger manufacturers.
  • The company seeks specialty retail and premium brand opportunities where customers are more concerned about their brand image, brand awareness, high level of service, and flexibility offered at the right price.
  • Talon looks to form strategic product alliances and tuck-in acquisitions that will widen its product offerings and increase its cross-selling opportunities; Talon also has the goal of significantly expanding its online marketing presence, dedicating resources to generate growth among ecommerce retailers.
  • Brand differentiation is being achieved with an active R&D program that continues to press for innovative products catering to changing fashion trends. By addressing the industry's increasing appetite for technology, Talon is focused on pursuing disruptive technologies in apparel-related products.
  • The company has an effective marketing program for innovative product lines such as Tekfit®, a patented technology that creates a stretchable product that will return to its original size without altering the garment's appearance, and Flex Collar, its most recently patented technology allowing collars to stretch.

We believe Talon is considerably undervalued based on precedent transactions in its industry. With recent investments in its product segments, including geographical expansion, and steady margins with cost control initiatives, Talon's offerings make it attractive from an acquisition standpoint. See full report for details.

The full report can be accessed by clicking on the following link:

About Stonegate Capital Partners

Stonegate Capital Partners is a Dallas-based corporate advisory firm dedicated to serving the specialized needs of small-cap public companies. Since our inception, our mission has been to find innovative, undervalued public companies for our network of leading institutional investors who seek high quality investment opportunities.

SOURCE: Stonegate Capital Partners