<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
(MARK ONE)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the quarterly period ended June 30, 1996.
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 0-27750
-------
IMPATH INC.
(exact name of registrant as specified in its charter)
-------------------------
<TABLE>
<CAPTION>
<S> <C> <C>
DELAWARE 8071 13-3459685
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
</TABLE>
1010 THIRD AVENUE, SUITE 302
NEW YORK, NEW YORK 10021
(212) 702-8300
(Address, including zip code, and telephone number,
including area code, of registrant's principal executive offices)
-------------------------
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.
Yes X No
--- ---
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
CLASS OUTSTANDING AT JULY 5, 1996
----- ---------------------------
Common Stock, par value 5,269,837
$.005 per share
<PAGE>
INDEX
IMPATH INC.
<TABLE>
<CAPTION>
PAGE NUMBER
-----------
<S> <C>
PART I FINANCIAL INFORMATION
Item 1 Condensed Financial Statements (Unaudited):
Condensed Balance Sheets at June 30, 1996
and December 31, 1995..................................... 3
Condensed Statements of Operations for the Three and Six
Months Ended June 30, 1996 and June 30, 1995.............. 4
Condensed Statements of Cash Flows for the Three and Six
Months Ended June 30, 1996 and June 30, 1995.............. 5
Condensed Statement of Stockholders' Equity for the
Three Months Ended June 30, 1996.......................... 6
Notes to Condensed Financial Statements................... 7-8
Item 2 Management's Discussion and Analysis of
Financial Condition and Results of Operations............. 9-11
PART II OTHER INFORMATION
Item 6 Exhibits and Reports on Form 8-K.......................... 12-15
Signatures........................................................ 16
</TABLE>
2
<PAGE>
IMPATH INC.
CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
ASSETS JUNE 30, DECEMBER 31,
1996 1995
(UNAUDITED)
----------- ------------
<S> <C> <C>
Current assets:
Cash and cash equivalents $10,954,102 $1,512,695
Investments, at fair value 14,194,148
Accounts receivable, net of allowance for doubtful accounts 5,699,690 3,807,376
Prepaid expenses and other current assets 563,814 273,361
Deferred tax assets, net 505,000 505,000
----------- ------------
Total current assets 31,916,754 6,098,432
Fixed assets, less accumulated depreciation and amortization 2,644,914 2,305,739
Deposits and other assets 88,878 79,961
Deferred registration costs - 746,462
Goodwill, net of accumulated amortization 29,481 30,727
----------- ------------
$34,680,027 $9,261,321
=========== ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Loan payable - current portion - 100,000
Current portion of capital lease obligations $ 466,743 $ 321,125
Accounts payable and accrued expenses 1,075,094 1,498,732
Income taxes payable - 78,415
Accrued dividends payable - 478,000
----------- ------------
Total current liabilities 1,541,837 2,476,272
----------- ------------
Capital lease obligations, net of current portion 1,071,818 946,723
Loan payable, net of current portion - 183,333
Stockholders' equity:
Convertible preferred stock
Series D 8% Convertible Participating Preferred Stock, $.01 par value. - 1,911,879
Series C 8% Convertible Preferred Stock, $.01 par value. - 2,702,546
Series B 8% Convertible Preferred Stock. $.01 par value. - 562,952
Series A 8% Convertible Preferred Stock $.01 par value. - 1,387,908
Common stock, $.005 par value, 26,349 2,275
Additional paid-in capital 32,229,740 11,447
Accumulated deficit 118,919 (548,672)
----------- ------------
32,375,008 6,030,335
Less-
Cost of shares of common stock held in treasury (100) (100)
Notes receivable from officers (28,421) (31,335)
Deferred compensation (280,115) (343,907)
----------- ------------
Total stockholders' equity 32,066,372 5,654,993
----------- ------------
$34,680,027 $9,261,321
=========== ============
</TABLE>
SEE ACCOMPANYING NOTES TO CONDENSED FINANCIAL STATEMENTS
3
<PAGE>
IMPATH INC.
CONDENSED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED JUNE 30, SIX MONTHS ENDED JUNE 30,
---------------------------- -------------------------
1996 1995 1996 1995
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Revenues,
Net diagnostic and prognostic services $5,021,886 $3,470,737 $9,716,236 $6,649,095
Contract laboratory services 58,011 27,839 105,686 65,132
---------- ---------- ---------- ----------
Total revenues 5,079,897 3,498,576 9,821,922 6,714,227
---------- ---------- ---------- ----------
Operating expenses,
Salaries and related costs 2,257,961 1,675,559 4,513,525 3,148,986
Selling, general and administrative 2,242,402 1,552,671 4,500,990 2,943,823
---------- ---------- ---------- ----------
Total operating expenses 4,500,363 3,228,230 9,014,515 6,092,809
---------- ---------- ---------- ----------
Income from operations 579,534 270,346 807,407 621,418
Interest income 334,069 30,814 454,807 49,733
Interest expense 45,042 12,208 90,747 25,303
---------- ---------- ---------- ----------
Income before income tax expense 868,561 288,952 1,171,467 645,848
Income tax expense (369,137) - (503,877) -
---------- ---------- ---------- ----------
Net income 499,424 288,952 667,590 645,848
========== ========== ========== ==========
Accrued dividends on preferred stock - (134,546) (82,346) (255,280)
---------- ---------- ---------- ----------
Net income available to common stockholders 499,424 $154,406 $585,244 $390,568
========== ========== ========== ==========
Pro forma net income per share $ 0.09 $ 0.09 $ 0.13 $ 0.20
========== ========== ========== ==========
Pro forma weighted average common and common
equivalent shares outstanding 5,760,000 3,315,000 5,118,000 3,184,000
========== ========== ========== ==========
</TABLE>
SEE ACCOMPANYING NOTES TO CONDENSED FINANCIAL STATEMENTS
4
<PAGE>
IMPATH INC.
CONDENSED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED JUNE 30,
---------------------------
1996 1995
------------ -----------
<S> <C> <C>
Cash flows from operating activities,
Net income $ 667,590 $ 645,848
Adjustments to reconcile net income to net cash provided
by operating activities-
Depreciation and amortization 369,607 135,942
Provision for uncollectible accounts receivable 1,132,625 610,001
Amortization of deferred compensation 63,792 -
Changes in assets and liabilities
Increase in accounts receivable (3,024,939) (1,067,063)
Increase in prepaid expenses and current assets (319,934) (302,173)
Increase in marketable securities (14,194,148) (1,971,643)
Decrease (Increase) in deposits and other assets 21,276 (9,568)
Decrease in accounts payable and accrued expenses (423,640) (164,887)
Increase in income taxes payable (78,415) -
------------ -----------
Total adjustments (16,453,776) (2,769,391)
------------ -----------
Net cash used in operating activities (15,786,186) (2,123,543)
------------ -----------
Cash flow from investing activities:
Capital expenditures (210,904) (426,886)
------------ -----------
Net cash used in investing activities (210,904) (426,886)
------------- -----------
Cash flows from financing activities:
Issuance of common stock 26,031,712 2,440
Issuance of preferred stock - 1,999,982
Payment of dividends on preferred stock (560,346) -
Repayments of bank loan (283,333) (100,000)
Proceeds from (payments of) capital lease obligations (226,629) 170,749
Payments received on officer loans 2,914 -
Deferred Registration Costs 474,179 -
------------ -----------
Net cash provided by financing activities 25,438,497 2,073,171
------------ -----------
Net increase (decrease) in cash and cash equivalents 9,441,407 (477,258)
Cash and cash equivalents at beginning of period 1,512,695 615,317
------------ -----------
Cash and cash equivalents at end of period $ 10,954,102 $ 138,059
============ ===========
</TABLE>
SEE ACCOMPANYING NOTES TO CONDENSED FINANCIAL STATEMENTS
5
<PAGE>
IMPATH INC.
CONDENSED STATEMENT OF STOCKHOLDERS' EQUITY
THREE MONTHS ENDED JUNE 30, 1996
(unaudited)
<TABLE>
<CAPTION>
NONREDEEMABLE
CONVERTIBLE NOTES
COMMON STOCK PREFERRED STOCK ADDITIONAL RECEIVABLE DEFERRED
----------------- --------------- PAID-IN ACCUMULATED TREASURY FROM COMPEN-
SHARES AMOUNT SHARES AMOUNT CAPITAL DEFICIT STOCK STOCKHOLDERS SATION TOTAL
------ ------ ------ ------ ---------- ----------- -------- ------------ -------- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Balance at March 31,
1996 5,266,096 $26,330 - - 32,494,643 (380,506) (100) (28,421) (312,011) 31,799,935
========== ======== ===== ======= =========== ========= ======= ========= ======== ==========
Net income for the period
ended April 30, 1996 88,228 88,228
Payments related to IPO (13,016) (13,016)
Common shares issued upon
exercise of stock
options 3,545 18 6,884 6,902
Amortization of Deferred
Compensation - - - 10,632 10,632
--------- ------ ----- ------- ---------- --------- ------- ---------- -------- ----------
Balance at
April 30, 1996 5,269,641 $26,348 - - 32,488,511 (292,278) (100) (28,421) (301,379) 31,892,681
========== ======== ===== ======= ========== ========= ======= ========= ======== ==========
Net income for the
period ended May 31, 1996 147,739 147,739
Payment related to IPO (259,268) (259,268)
Amortization of Deferred
Compensation - - - 10,632 10,632
---------- -------- ----- ------- ---------- --------- ------- ---------- -------- ----------
Balance at May 31, 1996 5,269,641 26,348 32,229,243 (144,539) (100) (28,421) (290,747) 31,791,784
========= ======= ===== ======= ========== ========= ======= ========= ======== ==========
Net income for the period
ended June 30, 1996 263,458 263,458
Payment related to IPO - -
Common shares issued upon
exercise of stock 196 1 497 498
Amortization of Deferred
Compensation 10,632 10,632
---------- -------- ----- ------- ---------- -------- ------ --------- -------- -----------
Balance at June 30, 1996 5,269,837 26,349 32,229,740 118,919 (100) (28,421) (280,115) 32,066,372
========== ======== ===== ======= ========== ========= ======= ========= ======== ===========
6
</TABLE>
<PAGE>
IMPATH INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(unaudited)
NOTE 1 - GENERAL:
The accompanying unaudited condensed financial statements have been prepared by
management in accordance with the rules and regulations of the United States
Securities and Exchange Commission.
In the opinion of Impath Inc. (the "Company" or "IMPATH"), the accompanying
unaudited condensed financial statements contain all adjustments, consisting
only of normal recurring adjustments necessary for the fair presentation of the
financial information for all periods presented. Results for the interim periods
are not necessarily indicative of the results for an entire year and do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. These financial
statements should be read in conjunction with the financial statements and the
notes thereto contained in the Company's Annual Report on Form 10-K for the year
ended December 31, 1995.
NOTE 2 - PRO FORMA NET INCOME PER SHARE:
Pro forma net income per share for the six months ended June 30, 1996 and 1995
and for the three months ended June 30, 1995 is based on the weighted
average number of shares of common stock outstanding after giving effect to the
conversion (calculated using the as-converted method) of the convertible
preferred stock that converted upon the completion of the Company's initial
public offering in February 1996. Common equivalent shares from stock options
and warrants are included in the computation using the treasury stock method to
the extent their effect is dilutive. All stock options and warrants issued
within a one year period prior to the initial public offering have been treated
as outstanding for all reported periods.
NOTE 3 - INITIAL PUBLIC OFFERING
On October 13, 1995 the Board of Directors authorized the Company to file a
registration statement with the Securities and Exchange Commission to register
shares of its common stock in connection with an initial public offering. Such
offering was consummated on February 26, 1996, for a total of 2,242,500 common
shares at an offering price of $13 per share. The net proceeds to the Company
amounted to approximately $26,062,000.
7
<PAGE>
NOTE 4 - INVESTMENTS
The Company invested approximately $20,000,000 of the net proceeds from its
initial public offering in a portfolio of short term fixed income securities
that are actively traded by an investment manager. In accordance with Statement
of Financial Accounting Standards No. 115, the Company's investments are being
recorded at fair value with gains and losses reported in the Statement of
Operations. At June 30, 1996, approximately $6,000,000 of securities with
original maturities of three months or less were included as cash equivalents.
The remaining securities included in the investment portfolio with original
maturities that exceed three months are included in current assets.
8
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Three Months Ended June 30, 1996 Compared with Three Months
- ------------------------------------------------------------
Ended June 30, 1995
- -------------------
The Company's total revenues for the three months ended June 30, 1996 and 1995
were $5,080,000 and $3,498,000, respectively, representing an increase of
$1,582,000, or 45.3%, in 1996. This growth was primarily attributable to a 19.0%
increase in case volume resulting from increased sales and marketing activities.
In addition, revenue realization per case increased due to product mix changes
toward cases which carry higher reimbursement rates.
Salaries and related costs for the three months ended June 30, 1996 and 1995
were $2,258,000 and $1,676,000, respectively, representing an increase of
$582,000, or 34.8%, in 1996. The 1996 increase was primarily due to an increase
in personnel headcount necessitated by increasing case volume. As a percentage
of total revenues, salaries and related costs, decreased to 44.5% in 1996 from
48.0% in 1995.
Selling, general and administrative expenses for the three months ended June 30,
1996 and 1995 were $2,242,000 and $1,553,000, respectively, representing an
increase of $689,000, or 44.4%, in 1996. The largest component of this increase
was an increase in bad debt expense of approximately $230,000 associated with
higher revenues, and a shift to more revenues requiring copayments. The Company
also incurred higher supply costs due to its increased volume as well as higher
travel related expenses associated with expanded sales and marketing activities.
Selling, general and administrative expenses as a percentage of total revenues
decreased to 44.2% in 1996 from 44.4% in 1995.
Income from operations for the three months ended June 30, 1996 and 1995 was
$580,000 and $270,000, respectively, representing an increase of $310,000, or
115.0%, in 1996. The 1996 figure reflects the effect on earnings of increasing
revenue growth and a decrease in operating expenses as a percentage of revenue
from 92.3% in the 1995 period to 88.6% in the 1996 period.
Interest income, net for the three months ended June 30, 1996 and 1995 was
$289,000 and $18,000, respectively, representing an increase of $271,000 in
1996. The increase was the result of increased interest income generated from
the proceeds of the Company's initial public offering of common stock in
February 1996, partially offset by increased interest expense due to additional
capital lease obligations.
9
<PAGE>
The tax provision for the three months ended June 30, 1996 of approximately
$369,000 reflects federal, state and local income tax expense. The Company has
estimated its annual effective tax rate for 1996 to be approximately 43% which
is in line with the current provision. For 1995, the Company had recorded
deferred tax assets to the extent of taxes that it expected to pay on estimated
1995 taxable earnings. Management believes that realization of such deferred
assets is more likely than not. As such, it estimated its annual effective tax
rate for 1995 to be zero.
As a result, net income for the three months ended June 30, 1996 and 1995 was
$499,000 and $288,000, respectively, representing an increase of $211,000 or
73.3% in 1996. As a percentage of total revenues, net income increased to 9.9%
in 1996 from 8.3% in 1995.
Six Months Ended June 30, 1996 Compared with Six Months
- -------------------------------------------------------
Ended June 30, 1995
- --------------------
The Company's total revenues for the six months ended June 30, 1996 and 1995
were $9,822,000 and $6,714,000, respectively, representing an increase of
$3,108,000, or 46.3%, in 1996. This growth was primarily due to a 26% increase
in case volume and an increase in revenue realization per case resulting from
product mix changes toward cases with higher reimbursement rates.
Salaries and related costs for the six months ended June 30, 1996 and 1995 were
$4,514,000 and $3,149,000, respectively, representing an increase of $1,365,000,
or 43.4%, in 1996. This increase was due to case volume growth and personnel
costs associated with the establishment of the Company's California facility
which commenced operations in December 1995. Salaries and related costs, as a
percentage of total revenues decreased to 46.0% in 1996 from 46.9% in 1995.
Selling, general and administrative expenses for the six months ended June 30,
1996 and 1995 were $4,501,000 and $2,944,000, respectively, representing an
increase of $1,557,000, or 52.9%, in 1996. This increase was due to an increase
in bad debt expense of approximately $523,000 associated with higher revenues,
as well as a shift to more revenues requiring copayments. The Company also
incurred higher supply costs due to increasing case volume and higher travel
related expenses associated with expanded sales and marketing activities. In
addition, the Company incurred approximately $200,000 of selling, general and
administrative expenses at its California facility which commenced operations in
December 1995. Selling, general and administrative expenses as a percentage of
total revenues increased to 45.9% in 1996 from 43.9% in 1995 as a result of the
costs associated with the establishment of the Company's California facility.
Income from operations for the six months ended June 30, 1996 and 1995 was
$807,000 and $621,000, respectively, representing an increase of $186,000, or
30%, in 1996. The 1996 figure reflects the effect on earnings of the net
operating expenses incurred in connection with the establishment of the
Company's California facility, which commenced operations during December 1995.
In June 1996, this facility began to generate sufficient incremental revenue to
cover operating expenses.
Interest income, net for the six months ended June 30, 1996 and 1995 was
$364,000 and $24,000, respectively, representing an increase of $340,000 in
1996. The increase was the result of increased interest income generated from
the proceeds of the Company's initial public offering of common stock in
February 1996, partially offset by increased interest expense due to additional
capital lease obligations.
The tax provision for the six months ended June 30, 1996 of approximately
$504,000 reflects federal, state and local income tax expense. The Company has
estimated its annual effective tax rate for 1996 to be approximately 43%
10
<PAGE>
which is in line with the current provision. For 1995, the Company had recorded
deferred tax assets to the extent of taxes that it expected to pay on estimated
1995 taxable earnings. Management believes that realization of such deferred
assets is more likely than not. As such, it estimated its annual effective tax
rate for 1995 to be zero.
As a result, net income for the six months ended June 30, 1996 and 1995 was
$668,000 and $645,000, respectively, representing an increase of $23,000, or
3.6%, in 1996. As a percentage of total revenues, net income decreased to 6.8%
in 1996 from 9.6% in 1995.
Liquidity and Capital Resources
- --------------------------------
The Company's cash and cash equivalent balances at June 30, 1996 and December
31, 1995 were $10,954,000 and $1,513,000, respectively, representing an increase
of $9,441,000 in 1996. In addition, the Company has invested approximately
$14,194,000 in marketable securities. This increase was primarily attributable
to approximately $26,000,000 of net proceeds from the initial public offering of
the Company's common stock, which was consummated on February 26, 1996.
For the six months ended June 30, 1996, the Company used net cash in operating
activities of approximately $15,786,000. This resulted from an increase in
investments of approximately $14,194,000 and an increase in accounts receivable
of approximately $1,892,000 due to rapid sales growth. In addition, the Company
paid approximately $560,000 in accrued dividends on preferred stock prior to the
initial public offering.
At June 30, 1996, the Company had working capital of approximately $30,364,000.
The Company's capital expenditures through June 30, 1996 in connection with the
establishment of its California facility were approximately $1,160,000, which
were partially financed through capital equipment leases, a $300,000 secured
term loan, and a $145,200 leasehold improvement allowance from the landlord.
The Company prepaid the balance of the $300,000 secured term loan with the
proceeds from the initial public offering.
The Company's growth strategy is anticipated to be financed through the net
proceeds from the initial public offering, its current cash resources and
existing third party credit facilities. The Company believes the combination of
these sources will be sufficient to fund its operations and satisfy the
Company's cash requirements for the next 12 months and the foreseeable future.
There may be circumstances, however, that would accelerate the Company's use of
proceeds from the initial public offering. If this occurs, the Company may,
from time to time, incur additional indebtedness or issue, in public or private
transactions, equity or debt securities. However, there can be no assurance
that suitable debt or equity financing will be available to the Company.
11
<PAGE>
Item 6 Exhibits and Reports on Form 8-K
----------------------------------------
(a) The exhibits required to be filed as part of this
Quarterly Report on Form 10-Q are listed in the attached Index to Exhibits.
(b) No reports on Form 8-K were filed during the quarter for which this
Quarterly Report on Form 10-Q is filed.
12
<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.
Date: August 13, 1996 IMPATH INC.
----------------------- --------------------------
(Registrant)
Date: August 13, 1996 By / s / ANU D. SAAD
----------------------- --------------------------
Anu D. Saad, Ph.D.
President and Chief
Executive Officer
Date: August 13, 1996 By / s / JOHN P. GANDOLFO
----------------------- ---------------------------
John P. Gandolfo
Executive Vice President,
Chief Financial Officer
and Principal Accounting
Officer
13
<PAGE>
INDEX TO EXHIBITS
-------------------
Exhibit Page
Number Description Number
------------- ----------------------- -------------
11 Statement re Computation of 14
Per Share Earnings for the
Three Months Ended June 30, 1996
and 1995 (Unaudited)
27 Financial Data Schedule 15
<PAGE>
EXHIBIT 11
STATEMENT RE COMPUTATION OF PER SHARE EARNINGS
<TABLE>
<CAPTION>
THREE MONTHS THREE MONTHS
ENDED JUNE 30, ENDED JUNE 30,
------------------ ----------------
1996 1995
------- -------
<S> <C> <C>
Net income available to common stockholders $499,424 $154,406
Accrued dividends on preferred stock - 134,546
--------- ----------
Net income for computing net income and pro forma net income per share (1) 499,424 288,952
========= ==========
Weighted and pro forma weighted average common shares outstanding (1) 5,261,443 2,985,363
Shares of common stock assumed to be issued upon
exercise of common stock options and warrants to
purchase common stock using treasury stock method,
including "cheap" options and warrants as outstanding for
all periods 498,557 329,637
--------- ----------
Weighted and pro forma weighted average number of common and common
equivalent shares outstanding (1) 5,760,000 3,315,000
========= ==========
Net income and pro forma net income per common and common
equivalent shares (1) $0.09 $0.09
========= ==========
</TABLE>
(1) Pro forma weighted average shares outstanding for the three months ended
June 30, 1995 gives retroactive effect to the conversion of the outstanding
shares of Preferred Stock into shares of Common Stock immediately prior to
the completion of the Company's initial public offering.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C> <C>
<CIK> 0001003114
<NAME> Impath Inc.
<CURRENCY> US DOLLARS US DOLLARS
<PERIOD-TYPE> 3-MOS 6-MOS
<FISCAL-YEAR-END> DEC-31-1996 DEC-31-1996
<PERIOD-START> APR-01-1996 JAN-1-1996
<PERIOD-END> JUN-30-1996 JUN-30-1996
<EXCHANGE-RATE> 1.000 1.000
<CASH> 25,148,250 25,148,250
<SECURITIES> 0 0
<RECEIVABLES> 8,034,708 8,034,708
<ALLOWANCES> 2,335,018 2,335,018
<INVENTORY> 120,032 120,032
<CURRENT-ASSETS> 31,916,754 31,916,754
<PP&E> 3,820,378 3,820,378
<DEPRECIATION> 1,175,464 1,175,464
<TOTAL-ASSETS> 34,680,027 34,680,027
<CURRENT-LIABILITIES> 1,552,469 1,552,469
<BONDS> 0 0
<COMMON> 26,349 26,349
0 0
0 0
<OTHER-SE> 32,348,659 32,348,659
<TOTAL-LIABILITY-AND-EQUITY> 34,680,027 34,680,027
<SALES> 5,079,897 9,821,923
<TOTAL-REVENUES> 5,079,897 9,821,923
<CGS> 1,990,190 3,954,461
<TOTAL-COSTS> 4,500,363 9,014,516
<OTHER-EXPENSES> 2,510,173 5,060,055
<LOSS-PROVISION> 549,897 1,132,625
<INTEREST-EXPENSE> 45,042 90,747
<INCOME-PRETAX> 868,561 1,171,467
<INCOME-TAX> 369,137 503,877
<INCOME-CONTINUING> 579,531 807,404
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 499,424 667,590
<EPS-PRIMARY> 0.09 0.13
<EPS-DILUTED> 0.09 0.13
</TABLE>
