UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended January 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____________ to ______________
Commission file number 0-27022
OPTICAL CABLE CORPORATION
(Exact name of registrant as specified in its charter)
Virginia 54-1237042
(State or other jurisdiction of incorporation (I.R.S. Employer
or organization) Identification No.)
5290 Concourse Drive
Roanoke, Virginia 24019
(Address of principal executive offices, including zip code)
(540) 265-0690
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. (1) Yes X No (2) Yes X No
--- --- --- ---
As of March 8, 2000, 37,564,121 shares of the registrant's Common Stock,
no par value, were outstanding. Of these outstanding shares 36,000,000 shares
were held by Robert Kopstein, Chairman of the Board, President and Chief
Executive Officer of the registrant.
<PAGE>
OPTICAL CABLE CORPORATION
Form 10-Q Index
Three Months Ended January 31, 2000
Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheets - January 31, 2000
and October 31, 1999.......................................2
Condensed Statements of Income - Three Months
Ended January 31, 2000 and 1999............................3
Condensed Statement of Changes in Stockholders'
Equity - Three Months Ended January 31, 2000...............4
Condensed Statements of Cash Flows - Three Months
Ended January 31, 2000 and 1999............................5
Condensed Notes to Condensed Financial Statements..........6-8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.....................9-12
Item 3. Quantitative and Qualitative Disclosures About Market Risk..13
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K............................14
SIGNATURES
<PAGE>
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
OPTICAL CABLE CORPORATION
Condensed Balance Sheets
(Unaudited)
January 31, October 31,
Assets 2000 1999
--------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Current assets:
Cash and cash equivalents $ 3,029,046 $ 6,816,678
Trading securities 7,523,250 -
Trade accounts receivable, net of allowance
for doubtful accounts of $271,000 at
January 31, 2000 and $316,000 at October 31, 1999 8,758,211 10,230,717
Other receivables 368,082 280,219
Due from employees 6,277 8,100
Note receivable 75,200 61,100
Inventories 8,537,940 8,754,423
Prepaid expenses 166,438 106,536
Deferred income taxes 192,539 206,652
--------------- --------------
Total current assets 28,656,983 26,464,425
Note receivable, noncurrent 18,405 32,505
Other assets, net 205,452 188,328
Property and equipment, net 11,071,723 10,826,331
--------------- --------------
Total assets $ 39,952,563 $ 37,511,589
=============== ==============
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable and accrued expenses $ 2,861,586 $ 3,370,244
Accrued compensation and payroll taxes 506,725 692,678
Income taxes payable 801,610 421,803
--------------- --------------
Total current liabilities 4,169,921 4,484,725
Deferred income taxes 189,058 179,789
--------------- --------------
Total liabilities 4,358,979 4,664,514
--------------- --------------
Stockholders' equity:
Preferred stock, no par value, authorized 1,000,000 shares;
none issued and outstanding -- --
Common stock, no par value, authorized 100,000,000 shares;
issued and outstanding 37,478,496 shares at January 31,
2000 and 37,414,271 shares at October 31, 1999 4,468,711 4,128,316
Paid-in capital 732,560 359,566
Retained earnings 30,392,313 28,359,193
--------------- --------------
Total stockholders' equity 35,593,584 32,847,075
Commitments and contingencies
--------------- --------------
Total liabilities and stockholders' equity $ 39,952,563 $ 37,511,589
=============== ==============
</TABLE>
See accompanying condensed notes to condensed financial statements.
2
<PAGE>
<TABLE>
<CAPTION>
OPTICAL CABLE CORPORATION
Condensed Statements of Income
(Unaudited)
Three Months Ended
January 31,
-------------------------------
2000 1999
--------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Net sales $ 11,346,235 $ 10,841,939
Cost of goods sold 6,141,120 6,119,752
--------------- --------------
Gross profit 5,205,115 4,722,187
Selling, general and administrative expenses 2,599,263 2,509,772
--------------- --------------
Income from operations 2,605,852 2,212,415
--------------- --------------
Other income:
Gains on trading securities, net 449,681 --
Interest income 80,390 33,999
Other, net 2,474 6,249
--------------- --------------
Other income, net 532,545 40,248
--------------- --------------
Income before income tax expense 3,138,397 2,252,663
Income tax expense 1,105,277 804,428
--------------- --------------
Net income $ 2,033,120 $ 1,448,235
=============== ==============
Net income per share:
Net income per common share $ 0.054 $ 0.038
=============== ==============
Net income per common share - assuming dilution $ 0.054 $ 0.038
=============== ==============
See accompanying condensed notes to condensed financial statements.
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
OPTICAL CABLE CORPORATION
Condensed Statement of Changes in Stockholders' Equity
(Unaudited)
Three Months Ended January 31, 2000
--------------------------------------------------------------------
Common Stock Total
------------------------- Paid-in Retained Stockholders'
Shares Amount Capital Earnings Equity
--------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Balances at October 31, 1999 37,414,271 $ 4,128,316 $ 359,566 $ 28,359,193 $ 32,847,075
Exercise of employee stock
options ($5.236 weighted-
average price per share) 63,225 331,020 -- -- 331,020
Restricted stock award
($9.375 per share) 1,000 9,375 -- -- 9,375
Tax benefit of disqualifying
disposition of stock
options exercised -- -- 372,994 -- 372,994
Net income -- -- -- 2,033,120 2,033,120
--------------------------------------------------------------------
Balances at January 31, 2000 37,478,496 $ 4,468,711 $ 732,560 $ 30,392,313 $ 35,593,584
====================================================================
</TABLE>
See accompanying condensed notes to condensed financial statements.
4
<PAGE>
<TABLE>
<CAPTION>
OPTICAL CABLE CORPORATION
Condensed Statements of Cash Flows
(Unaudited)
Three Months Ended
January 31,
-------------------------------
2000 1999
--------------- --------------
<S> <C> <C> <C> <C> <C> <C>
Cash flows from operating activities:
Net income $ 2,033,120 $ 1,448,235
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation and amortization 184,250 211,282
Bad debt recovery (46,284) (49,000)
Deferred income tax expense 23,382 33,102
Stock-based compensation expense 9,375 --
Unrealized gains on trading securities, net (142,790) --
(Increase) decrease in:
Trading securities (7,380,460) --
Trade accounts receivable 1,518,790 1,574,101
Other receivables (87,863) (20,252)
Due from employees 1,823 950
Inventories 216,483 136,957
Prepaid expenses (59,902) (46,800)
Increase (decrease) in:
Accounts payable and accrued expenses (420,678) 1,033,635
Accrued compensation and payroll taxes (185,953) (239,306)
Income taxes payable 752,801 771,326
-------------- -------------
Net cash provided by (used in) operating activities (3,583,906) 4,854,230
-------------- -------------
Cash flows from investing activities:
Purchase of property and equipment (513,371) (40,722)
Cash surrender value of life insurance (21,375) (25,433)
-------------- -------------
Net cash used in investing activities (534,746) (66,155)
-------------- -------------
Cash flows from financing activities:
Repurchase of common stock -- (773,790)
Proceeds from exercise of employee stock options 331,020 24,250
-------------- -------------
Net cash provided by (used in) financing activities 331,020 (749,540)
-------------- -------------
Net increase (decrease) in cash and cash equivalents (3,787,632) 4,038,535
Cash and cash equivalents at beginning of period 6,816,678 1,122,277
-------------- -------------
Cash and cash equivalents at end of period $ 3,029,046 $ 5,160,812
============== =============
</TABLE>
See accompanying condensed notes to condensed financial statements.
5
<PAGE>
OPTICAL CABLE CORPORATION
Condensed Notes to Condensed Financial Statements
Three Months Ended January 31, 2000
(Unaudited)
(1) General
The accompanying unaudited condensed financial statements have been
prepared in accordance with generally accepted accounting principles for
interim financial reporting information and the instructions to Form 10-Q
and Article 10 of Regulation S-X. Accordingly, they do not include all of
the information and notes required by generally accepted accounting
principles for complete financial statements. In the opinion of
management, all material adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the three months ended January 31, 2000 are not
necessarily indicative of the results that may be expected for the fiscal
year ending October 31, 2000. The unaudited condensed financial statements
and condensed notes are presented as permitted by Form 10-Q and do not
contain certain information included in the Company's annual financial
statements and notes. For further information, refer to the financial
statements and notes thereto included in the Company's annual report on
Form 10-K for the fiscal year ended October 31, 1999.
(2) Trading Securities
Trading securities are recorded at fair value, which is based on quoted
market prices. Purchases and sales of trading securities are recognized on
a trade-date basis, the date the order to buy or sell is executed. The
Company's trading securities are bought and held principally for the
purpose of selling them in the near term. Unrealized holding gains and
losses for trading securities are included in net income. The amount of
net unrealized holding gain that has been included in net income for the
three months ended January 31, 2000 was $142,790. As of January 31, 2000,
the Company's trading securities consist of shares in a stock index mutual
fund concentrated in the technology sector.
(3) Inventories
Inventories at January 31, 2000 and October 31, 1999 consist of the
following:
<TABLE>
<CAPTION>
January 31, October 31,
2000 1999
------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Finished goods $ 3,295,202 $ 2,976,426
Work in process 2,567,049 2,306,209
Raw materials 2,604,216 3,416,046
Production supplies 71,473 55,742
------------- -------------
$ 8,537,940 $ 8,754,423
============= =============
</TABLE>
(4) Notes Payable
Under a loan agreement with its bank dated March 10, 1999, the Company has
a $5 million secured revolving line of credit and a $10 million secured
revolving line of credit. The Company's intention is that the $5 million
line of credit be available to fund general corporate purposes and that
the $10
6
<PAGE>
OPTICAL CABLE CORPORATION
Condensed Notes to Condensed Financial Statements
(Unaudited)
million line of credit be available to fund potential acquisitions and
joint ventures. The lines of credit bear interest at 1.50 percent above
the monthly LIBOR rate and are equally and ratably secured by the
Company's accounts receivable, contract rights, inventory, furniture and
fixtures, machinery and equipment and general intangibles. The lines of
credit will expire on February 28, 2001, unless renewed or extended. While
the lines of credit do not require a compensating balance that legally
restricts the use of cash amounts, at the bank's request, the Company has
agreed to maintain an unrestricted target cash balance of $125,000.
(5) Net Income Per Share
Net income per common share excludes dilution and is computed by dividing
income available to common stockholders by the weighted-average number of
common shares outstanding for the period. Net income per common share -
assuming dilution reflects the potential dilution that could occur if
securities or other contracts to issue common stock were exercised or
converted into common stock or resulted in the issuance of common stock
that then shared in the net income of the entity. The following is a
reconciliation of the numerators and denominators of the net income per
common share computations for the periods presented:
<TABLE>
<CAPTION>
Net Income Shares Per Share
Three Months Ended January 31, 2000 (Numerator) (Denominator) Amount
----------------------------------- ---------------- ---------------- -------------
<S> <C> <C> <C> <C> <C> <C>
Net income per common share $ 2,033,120 37,451,813 $ 0.054
============
Effect of dilutive stock options -- 298,275
---------------- ----------------
Net income per common share - assuming dilution $ 2,033,120 37,750,088 $ 0.054
================ ================ ============
Three Months Ended January 31, 1999
-----------------------------------
Net income per common share $ 1,448,235 37,850,680 $ 0.038
============
Effect of dilutive stock options -- 301,466
---------------- ----------------
Net income per common share - assuming dilution $ 1,448,235 38,152,146 $ 0.038
================ ================ ============
</TABLE>
Subsequent to January 31, 2000 and through March 8, 2000, stock options
totaling 81,375 shares of common stock were exercised.
(6) Segment Information
On November 1, 1998, the Company adopted Statement of Financial Accounting
Standards (SFAS) No. 131, "Disclosures about Segments of an Enterprise and
Related Information." SFAS No. 131 establishes standards for the way public
business enterprises are to report information about operating segments in
annual financial statements and requires those enterprises to report
selected information about operating segments in condensed financial
statements of interim periods.
7
<PAGE>
OPTICAL CABLE CORPORATION
Condensed Notes to Condensed Financial Statements
(Unaudited)
The Company has a single reportable segment for purposes of segment
reporting pursuant to SFAS No. 131.
8
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Forward Looking Information
This Form 10-Q may contain certain "forward-looking" information within the
meaning of the federal securities laws. The forward-looking information may
include, among other information, (i) statements concerning the Company's
outlook for the future, (ii) statements of belief, (iii) future plans,
strategies or anticipated events and (iv) similar information and statements
concerning matters that are not historical facts. Such forward-looking
information is subject to risks and uncertainties that may cause actual events
to differ materially from the expectations of the Company. Factors that could
cause or contribute to such differences include, but are not limited to, the
level of sales to key customers, actions by competitors, fluctuations in the
price of raw materials (including optical fiber), the Company's dependence on a
single manufacturing facility, the ability of the Company to protect its
proprietary manufacturing technology, the Company's dependence on a limited
number of suppliers, the effect of the Year 2000 issue on suppliers and
customers, technological changes and introductions of new competing products,
changes in market demand, and market and economic conditions in the areas of the
world in which the Company operates and markets its products.
Results of Operations
Three Months Ended January 31, 2000
Net Sales
Net sales consist of gross sales of products, less discounts, refunds and
returns. Net sales increased 4.7 percent to $11.3 million in first quarter 2000
from $10.8 million for the same period in 1999. This increase was attributable
to increased sales volume. Total cable meters shipped in first quarter 2000
increased 13.0 percent to 39.2 million from 34.7 million cable meters shipped
for the same period in 1999. This increase in cable meters shipped was a result
of a 1.5 million increase in multimode cable meters and a 3.0 million increase
in single-mode cable meters shipped. Single-mode cable typically has a lower
selling price than multimode cable.
Gross Profit Margin
Cost of goods sold consists of the cost of materials, compensation costs and
overhead related to the Company's manufacturing operations. The Company's gross
profit margin (gross profit as a percentage of net sales) increased to 45.9
percent in first quarter 2000 from 43.6 percent in first quarter 1999. This
increase in gross profit margin is partially attributable to a decrease in large
orders. During first quarter 2000, sales from orders of $50,000 or more
approximated 12.0 percent of total sales compared to 20.0 percent of total sales
for first quarter 1999. In addition, during the first quarter of fiscal years
2000 and 1999, net sales to distributors approximated 61.0 percent and 55.0
percent, respectively. Discounts on large orders and on sales to distributors
are generally greater than discounts on sales to the Company's other customer
base.
Selling, General and Administrative Expenses
Selling, general and administrative expenses consist of the compensation costs
(including sales commissions) for sales and marketing personnel, travel
expenses, customer support expenses, trade show expenses, advertising, the
compensation cost for administration, finance and general management personnel,
as well as legal and accounting fees. Selling, general and administrative
expenses as a percentage of net sales were 22.9 percent in first quarter 2000
compared to 23.1 percent in first quarter 1999. This slightly lower percentage
was primarily the result of a 4.7 percent increase in net sales for first
quarter 2000, compared to first quarter 1999, while selling, general and
administrative expenses increased only 3.6 percent over the same period.
9
<PAGE>
Other Income
Other income increased $492,000 to $532,000 for the three months ended January
31, 2000, compared to $40,000 for the same period in 1999. During first quarter
2000, the Company began investing in trading securities and has recognized
related gains on trading securities, net of $450,000 in other income.
Income Before Income Tax Expense
Income before income tax expense increased 39.3 percent to $3.1 million for the
three months ended January 31, 2000, compared to $2.3 million for the three
months ended January 31, 1999. This increase was primarily due to increased
sales volume, the increase in gross profit margin and gains on trading
securities, net.
Income Tax Expense
Income tax expense increased $301,000 to $1.1 million for the three months ended
January 31, 2000, compared to $804,000 for the same period in 1999 due to the
increase in income before income tax expense. The Company's effective tax rate
was 35.2 percent during the three months ended January 31, 2000, compared to
35.7 percent for the same period in 1999.
Net Income
Net income for first quarter 2000 was $2.0 million, compared to $1.4 million for
first quarter 1999. Net income increased $585,000 due to the $886,000 increase
in income before income tax expense offset by the increase in income tax expense
of $301,000.
Financial Condition
Total assets at January 31, 2000 were $40.0 million, an increase of $2.4
million, or 6.5 percent from October 31, 1999. This increase was primarily due
to an increase of $7.5 million in trading securities, partially offset by a
decrease of $3.8 million in cash and cash equivalents and a decrease of $1.5
million in trade accounts receivable resulting from the decreased sales volume
during first quarter 2000 as compared to the three months ended October 31,
1999.
Total stockholders' equity at January 31, 2000 increased $2.7 million, or 8.4
percent in first quarter 2000 with net income retained accounting for the
majority of the increase.
Liquidity and Capital Resources
During the first quarter of fiscal years 2000 and 1999, the Company's primary
capital needs have been to fund working capital requirements and capital
expenditures as needed. The Company's primary source of financing has been cash
provided from operations. The Company maintains bank lines of credit; however,
there were no balances outstanding under the lines as of the end of fiscal year
1999 or the end of the first quarter of fiscal year 2000.
Under a loan agreement with its bank dated March 10, 1999, the Company has a $5
million secured revolving line of credit available and a $10 million secured
revolving line of credit. The Company's intention is that the $5 million line of
credit be available to fund general corporate purposes and that the $10 million
line of credit be available to fund potential acquisitions and joint ventures.
The lines of credit bear interest at 1.50
10
<PAGE>
percent above the monthly LIBOR rate and are equally and ratably secured by the
Company's accounts receivable, contract rights, inventory, furniture and
fixtures, machinery and equipment and general intangibles. The lines of credit
will expire on February 28, 2001, unless renewed or extended. As of the date
hereof, the Company has no additional material sources of financing. The Company
believes that its cash flow from operations and available lines of credit will
be adequate to fund its operations for at least the next twelve months.
Cash flows used in operations were approximately $3.6 million in first quarter
2000, compared to cash flows provided by operations of approximately $4.9
million in first quarter 1999. Cash flows used in operations in first quarter
2000 were primarily due to the purchase of approximately $7.4 million in trading
securities and decrease in accounts payable and accrued expenses of $421,000,
partially offset by an increase in operating income and a decrease in trade
accounts receivable of approximately $1.5 million. For first quarter 1999, cash
flows from operations were primarily provided by operating income, a decrease in
trade accounts receivable of $1.6 million and an increase in accounts payable
and accrued expenses of $1.0 million.
Net cash used in investing activities was mainly for expenditures related to
facilities and equipment and was $535,000 and $66,000 in first quarters 2000 and
1999, respectively. As of January 31, 2000, there were no material commitments
for additional capital expenditures.
Net cash provided by financing activities was $331,000 in first quarter 2000 and
related to proceeds from exercise of employee stock options. The net cash used
in financing activities of $750,000 in first quarter 1999 was primarily related
to the Company's common stock repurchase program.
The Company's Board of Directors has authorized the repurchase of up to $20
million of the Company's common stock in the open market or in privately
negotiated transactions. Through January 31, 2000, the Company has repurchased
approximately $14.9 million of its common stock in such transactions since the
inception of the Company's share repurchase program in October 1997. The
repurchases were funded through cash flows from operations. The Company may use
excess working capital and other sources as appropriate to finance the remaining
share repurchase program.
Derivatives
The Company does not use derivatives or off-balance sheet instruments such as
future contracts, forward obligations, interest rate swaps or option contracts.
Year 2000
The Company was cognizant of the risks posed by the Year 2000 issue for both its
operations and its customers. Subsequent to December 31, 1999, the Company is
not aware of any information that indicates a significant vendor or service
provider may be unable to sell goods or provide services to the Company because
of Year 2000 issues. Further, the Company has not received any notifications
from lenders or regulatory agencies to which it is subject, indicating that (1)
a lender considers or may consider the Company to be in violation of a loan
agreement or (2) significant regulatory action is being or may be taken against
the Company, as a result of Year 2000 issues. Nevertheless, there can be no
assurances that the Year 2000 issue will not have a negative effect on the
Company's customers or suppliers in the future.
The Company has not experienced any significant disruptions to its financial or
operating activities caused by any failure of its computerized systems resulting
from Year 2000 issues. Management does not expect Year 2000 issues to have a
material adverse effect on the Company's operations or financial results in
2000.
11
<PAGE>
The Company prepared for the millennium change and expects to continue to
successfully operate and handle the transactions of its customers subsequent to
December 31, 1999.
Future Accounting Considerations
In June 1998, the Financial Accounting Standards Board (FASB) issued Statement
of Financial Accounting Standards (SFAS) No. 133, "Accounting for Derivative
Instruments and Hedging Activities." In June 1999, the FASB issued SFAS No. 137,
"Accounting for Derivative Instruments and Hedging Activities - Deferral of the
Effective Date of FASB Statement No. 133." SFAS No. 137 defers the effective
date of SFAS No. 133 to apply to all fiscal quarters of all fiscal years
beginning after June 15, 2000. It is not anticipated that SFAS No. 133 will have
a material effect on the financial position, results of operations or liquidity
of the Company.
As of January 31, 2000, there are no other new accounting standards issued, but
not yet adopted by the Company, which are expected to be applicable to the
Company's financial position, operating results or financial statement
disclosures.
12
<PAGE>
Item 3. Quantitative and Qualitative Disclosures About Market Risk
The Company does not engage in derivative financial instruments or derivative
commodity instruments. As of January 31, 2000, the Company's financial
instruments are not exposed to significant market risk due to interest rate
risk, foreign currency exchange risk or commodity price risk. However, as of
January 31, 2000, the Company's trading securities, which consist of shares in a
stock index mutual fund concentrated in the technology industry sector, are
exposed to equity price risk. It is reasonably possible that the price of these
trading securities, valued at approximately $7.5 million as of January 31, 2000,
could experience an adverse change in the near term. For illustration purposes,
assuming a 30 percent adverse change in the fund's equity price, the Company's
trading securities would decrease in value by approximately $2.3 million, based
on the value of the Company's portfolio as of January 31, 2000. This assumption
is not necessarily indicative of future performance and actual results may
differ materially.
13
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits required by Item 601 of Regulation S-K for the three
months ended January 31, 2000.
27 Financial Data Schedule
(b) Reports on Form 8-K filed during the three months ended January
31, 2000.
None.
14
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
OPTICAL CABLE CORPORATION
(Registrant)
Date: March 16, 2000 /s/Robert Kopstein
--------------------
Robert Kopstein
Chairman of the Board, President and
Chief Executive Officer
Date: March 16, 2000 /s/Kenneth W. Harber
--------------------
Kenneth W. Harber
Vice President of Finance, Treasurer
and Secretary
(principal financial and accounting
officer)
<PAGE>
INDEX TO ATTACHED EXHIBITS
Exhibit Number Description
-------------- -----------
27 Financial Data Schedule.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FINANCIAL
STATEMENTS FOR THE THREE MONTHS ENDED JANUARY 31, 2000 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
Amounts inapplicable or not disclosed as a separate line on the Balance Sheet or
Statement of Income are reported as 0 herein.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-31-2000
<PERIOD-START> NOV-01-1999
<PERIOD-END> JAN-31-2000
<EXCHANGE-RATE> 1
<CASH> 3,029
<SECURITIES> 7,523
<RECEIVABLES> 9,123
<ALLOWANCES> 271
<INVENTORY> 8,538
<CURRENT-ASSETS> 28,657
<PP&E> 16,354
<DEPRECIATION> 5,283
<TOTAL-ASSETS> 39,953
<CURRENT-LIABILITIES> 4,170
<BONDS> 0
0
0
<COMMON> 4,469
<OTHER-SE> 31,125
<TOTAL-LIABILITY-AND-EQUITY> 39,953
<SALES> 11,346
<TOTAL-REVENUES> 11,879
<CGS> 6,141
<TOTAL-COSTS> 8,740
<OTHER-EXPENSES> 0
<LOSS-PROVISION> (46)
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 3,138
<INCOME-TAX> 1,105
<INCOME-CONTINUING> 2,033
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,033
<EPS-BASIC> 0.054
<EPS-DILUTED> 0.054
</TABLE>
