- ------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
-----------------
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarter 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 0-27460
PERFORMANCE TECHNOLOGIES, INCORPORATED
(Exact name of registrant as specified in its charter)
-------------------
Delaware 16-1158413
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation of organization)
14620
315 Science Parkway, Rochester New York (Zip Code)
(Address of principal executive
offices)
Registrant's telephone number, including area code: (716) 256-0200
-----------------------------
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 .
The number of shares outstanding of the registrant's common stock was
4,782,543 as of August 8, 1996.
- --------------------------------------------------------------------------------
<PAGE>
Performance Technologies, Incorporated and Subsidiaries
Index
Page
Part I. Financial Information
Item 1. Consolidated Financial Statements
Consolidated Balance Sheets as of June 30, 1996 (unaudited)
and December 31, 1995 3
Consolidated Statements of Income For The Three and Six
Months Ended June 30, 1996 and 1995 (unaudited) 4
Consolidated Statements of Cash Flows For The Six Months
Ended June 30, 1996 and 1995 (unaudited) 5
Notes to Consolidated Financial Statements For The Six
Months Ended June 30, 1996 6
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations 7
Part II. Other Information
Item 4. Submission of Matters to Vote of Security Holders 10
Item 6. Exhibits and Reports on Form 8-K 10
Signatures 12
<PAGE>
Performance Technologies, Incorporated and Subsidiaries
Consolidated Balance Sheets
<TABLE>
<CAPTION>
June 30, December 31,
1996 1995
--------------- --------------
(UNAUDITED)
ASSETS
<S> <C> <C>
Current Assets
Cash and cash equivalents $13,729,000 $2,466,000
Accounts receivable, net 2,998,000 2,210,000
Inventories - Note D 4,424,000 3,412,000
Prepaid income taxes 216,000 334,000
Prepaid expenses and other 151,000 294,000
Deferred taxes 213,000 238,000
--------------- --------------
Total current assets 21,731,000 8,954,000
Equipment and improvements, net 1,078,000 1,078,000
Software capitalization, net 481,000 418,000
Other assets - Note C 208,000 73,000
--------------- --------------
Total assets $23,498,000 $10,523,000
=============== ==============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long term debt $88,000 $73,000
Accounts payable 799,000 1,427,000
Accrued expenses 1,571,000 1,239,000
--------------- --------------
Total current liabilities 2,458,000 2,739,000
--------------- --------------
Long term debt 176,000 57,000
Deferred taxes 157,000 157,000
--------------- --------------
Total liabilities 2,791,000 2,953,000
--------------- --------------
MINORITY INTEREST - Note C 83,000
--------------
STOCKHOLDERS' EQUITY
Preferred stock
Common stock - Note B 49,000 33,000
Additional paid-in capital 12,812,000 1,414,000
Retained earnings 8,003,000 6,196,000
Less: Treasury stock (157,000) (156,000)
--------------- --------------
Total stockholders' equity 20,707,000 7,487,000
--------------- --------------
Total Liabilities and stockholders' equity $23,498,000 $10,523,000
=============== ==============
</TABLE>
<PAGE>
Performance Technologies, Incorporated and Subsidiaries
Consolidated Statements of Income
For the Three and Six Months Ending June 30, 1996 and 1995
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
1996 1995 1996 1995
----------- ----------- ------------ -----------
<S> <C> <C> <C> <C>
Sales $6,463,000 $4,144,000 $12,000,000 $8,075,000
Cost of goods sold 2,742,000 1,925,000 5,106,000 3,628,000
----------- ----------- ------------ -----------
Gross profit 3,721,000 2,219,000 6,894,000 4,447,000
----------- ----------- ------------ -----------
Operating expenses:
Selling and marketing 889,000 481,000 1,569,000 952,000
Research and development 729,000 372,000 1,322,000 744,000
General and administrative 805,000 647,000 1,393,000 1,320,000
----------- ----------- ------------ -----------
Total operating expenses 2,423,000 1,500,000 4,284,000 3,016,000
----------- ----------- ------------ -----------
Income from operations 1,298,000 719,000 2,610,000 1,431,000
Other income 175,000 34,000 307,000 86,000
----------- ----------- ------------ -----------
Income before taxes and
minority interest 1,473,000 753,000 2,917,000 1,517,000
Provision for income taxes 558,000 231,000 1,086,000 484,000
----------- ----------- ------------ -----------
Income before minority interest 915,000 522,000 1,831,000 1,033,000
Minority interest - Note C (5,000) (5,000) (24,000) (57,000)
----------- ----------- ------------ -----------
Income from continuing operations 910,000 517,000 1,807,000 976,000
Loss from discontinued operations (19,000)
----------- ----------- ------------ -----------
Net income $910,000 $517,000 $1,807,000 $957,000
=========== =========== ============ ===========
Earnings per share:
Income from continuing operations $0.18 $0.16 $0.38 $0.30
----------- ----------- ------------ -----------
Loss from discontinued operations (0.01)
----------- ----------- ------------ -----------
Net income $0.18 $0.16 $0.38 $0.29
----------- ----------- ------------ -----------
Weighted average common and
common share equivalents 4,968,000 3,286,000 4,721,000 3,288,000
=========== =========== ============ ===========
</TABLE>
<PAGE>
Performance Technologies, Incorporated and Subsidiaries
Consolidated Statements of Cash Flows
For the Six Months Ending June 30, 1996 and 1995
(UNAUDITED)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
1996 1995
------------ ------------
<S> <C> <C>
Cash flows from operating activities
Net Income $1,807,000 $957,000
Non-cash adjustments:
Depreciation and amortization 352,000 306,000
Provision for bad debts (104,000) 128,000
Reserve for inventory obsolescence 309,000 136,000
Gain on sale of equipment (8,000)
Minority Interest 24,000 57,000
Deferred income taxes 25,000 30,000
Issuance of warrants 61,000
Changes in operating assets and liabilities:
Accounts receivable (684,000) (622,000)
Inventories (1,321,000) (381,000)
Prepaid expenses and other 152,000 (28,000)
Accounts payable (248,000)
Accrued expenses 332,000 355,000
Prepaid income taxes 118,000 7,000
Discontinued operations - non-cash charges
and working capital changes 495,000
------------ ------------
Net cash provided by operating activities 754,000 1,501,000
------------ ------------
Cash flows from investing activities
Cash purchases of equipment and improvements (581,000) (121,000)
Proceeds from sale of equipment 8,000
Capitalized software development (196,000) (166,000)
Purchase of remaining shares in subsidiary (93,000)
Investing activities of discontinued operations (129,000)
------------ ------------
Net cash used by investing activities (862,000) (416,000)
------------ ------------
Cash flows from financing activities
Payments on capital lease obligations (30,000) (32,000)
Borrowings from line of credit 535,000
Repayment of line of credit and notes payable (12,000) (1,441,000)
Net proceeds from issuance of common stock 11,413,000 105,000
------------ ------------
Net cash provided (used) by financing activities 11,371,000 (833,000)
------------ ------------
Net increase in cash 11,263,000 252,000
Cash and cash equivalents at beginning of period 2,466,000 620,000
------------ ------------
Cash and cash equivalents at end of period $13,729,000 $872,000
============ ============
</TABLE>
<PAGE>
Performance Technologies, Incorporated and Subsidiaries
Notes to Consolidated Financial Statements
For The Six Months Ended June 30, 1996
(Unaudited)
Note - A The unaudited consolidated financial statements of Performance
Technologies, Incorporated and subsidiaries (the "Company") have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10 - Q and Article 10 of
Regulation S-X of the Securities and Exchange Commission. Accordingly, the
consolidated financial statements do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments considered
necessary for a fair presentation have been included. The results for the
interim periods are not necessarily indicative of the results to be expected for
the year. The accompanying consolidated financial statements should be read in
conjunction with the consolidated financial statements presented in the
Company's Special Report on Form 10 - K.
Note - B There were 4,779,306 and 3,166,000 shares issued and outstanding at
June 30, 1996 and December 31, 1995, respectively, of the Company's $.01 par
value Common Stock. During the six months ended June 30, 1996, 13,825 common
shares were issued upon the exercise of stock options.
Note - C On March 31, 1996, the Company paid $44,000 and executed promissory
notes to the selling stockholders totaling $176,000 to acquire an additional 39%
interest in its subsidiary, UconX Corporation. On April 30, 1996, UconX
purchased the outstanding shares of its other remaining stockholders for $48,000
resulting in UconX becoming a wholly-owned subsidiary of the Company. In
connection with these transactions, additional goodwill of $188,000 was
recorded. Goodwill is amortized using the straight-line method over five years.
Note - D Inventories consisted of the following at June 30, 1996 and December
31, 1995:
June 30, December 31,
1996 1995
----------- ------------
Purchased parts and components $ 1,730,000 $ 1,467,000
Work in process 2,705,000 1,691,000
Finished goods 338,000 383,000
----------- ------------
4,773,000 3,541,000
Less:reserve for inventory obsolescence (349,000) (129,000)
----------- ------------
Net $ 4,424,000 $ 3,412,000
=========== ============
Note - E In October 1995, the Financial Accounting Standards Board ("FASB")
issued FAS No. 123 Accounting for Stock-Based Compensation, effective for fiscal
years beginning after December 15, 1995. FAS 123 indicates a preference for a
fair value based method of accounting for employee stock options, but allows for
continuation of the intrinsic value based method under U.S. Accounting
Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees". The
Company has chosen to continue its use of the intrinsic value based method of
accounting, but will present required financial statement disclosures in its
Annual Report on Form 10-K for the year ended December 31, 1996 to be filed with
the U.S. Securities and Exchange Commission.
<PAGE>
Performance Technologies, Incorporated and Subsidiaries
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
The following discussion and analysis of the Company's financial condition
and results of operations during the periods included in the accompanying
financial statements focuses on the Company's continuing operations and does not
include any discussion or analysis with respect to the Company's discontinued
operations. In March 1995, the Telecommunications, Vision Systems and Data Base
Management Software businesses were consolidated into one corporation and spun
off to our stockholders ("Spin-Off").
Overview
The Company's revenues are generated from products designed to enhance the
performance of network systems based on varied computer architectures including
VMEbus, SBus and PCIbus. The Company has a proven record of adapting its
products to a continually changing marketplace.
Historically, approximately 65% of the Company's sales have been to OEMs.
Management intends to increase its marketing efforts to VARs, distributors and
systems integrators to develop a larger worldwide distribution network. The
Company has increased sales primarily by developing new products and by
increasing the unit sales volumes of existing products. Domestic sales
represented 93% of total sales for the second quarter ending June 30, 1996,
compared to 86% for 1995. During the second quarter, the Company participated in
two major computer shows, Interop 96 and Networks Expo 96 (United Kingdom) to
promote its networking and communications products. Two of the Company's stated
sales objectives for 1996 are to open a direct sales office in Europe and
investigate opening another direct sales office in the Pacific Rim. During the
second quarter, the Company opened a direct sales office in Munich, Germany to
sell its WAN, LAN and data storage interface systems products.
During the second quarter, the Company released and began shipping two new
products: the Ultra SCSI Adapter which increases the performance, reliability
and disk throughput of Sun workstations; and ComLink Communications Software
which makes several of the Company's WAN controllers Plug n' Play compatible
with Sun Microsystems, Inc.'s SunLink communications software.
In April, the Company launched its Ethernet Protocol Switch, Nebula
2000(TM) and its StarGazer(TM) Network Management Software at the Interop 96
computer show. The Nebula 2000 switch provides powerful capabilities for growing
networks, coupled with the advanced StarGazer network management system that
allows network managers greater access into their network configurations and
visibility of network traffic. During the quarter, the Company staffed a
separate organization to establish distribution channels for these products.
Discussions are underway to place these products with a national distributor of
networking products and also with a potential "private label" reseller.
In order to meet its aggressive growth plans, the Company must continue to
develop new and more advanced networking and communication products. To achieve
this objective, the Company intends to hire approximately ten new hardware and
software engineers during 1996. Recruiting engineers is one of the Company's
greatest challenges. While a number of engineers were hired early in the year,
the Company is actively recruiting to fill open positions and is also
investigating alternative strategies. As the Company succeeds in hiring
qualified engineers and further accelerates the development of its next
generation LAN, WAN and Ethernet switching products, research and development
expenses will likely represent a greater percentage of sales than in the past
several years.
<PAGE>
In May, Alan Daniels, the Company's western regional sales manager, was
promoted to the position of President of UconX Corporation. A new regional sales
manager was hired for the west coast as his replacement. On March 31, 1996, the
Company paid $44,000 and executed promissory notes to the selling stockholders
for $176,000 to acquire an additional 39% interest in its subsidiary, UconX
Corporation. On April 30, 1996, UconX purchased its other remaining outstanding
shares for $48,000 resulting in UconX becoming a wholly-owned subsidiary of the
Company. In connection with these transactions, additional goodwill of $188,000
was recorded. Goodwill is amortized using the straight-line method over five
years.
Quarter and Six Months Ended June 30, 1996, compared with
the Quarter and Six Months Ended June 30, 1995
SALES. Sales for the second quarter of 1996 increased by $2,319,000
(56.0%) to $6,463,000, from $4,144,000 for the second quarter of 1995 primarily
due to the increasing demand for the Company's WAN and LAN/FDDI products. The
second quarter of 1996 also benefited from a significant contract originally
scheduled for shipment over the second and third quarters of 1996, which was
expedited at the customer's request and completely shipped during this quarter.
Sales for the six months ended June 30, 1996 increased by $3,925,000 (48.6%) to
$12,000,000, from $8,075,000 for the six months ended June 30, 1995.
International sales amounted to $465,000 for the quarter ended June 30,
1996, compared to $608,000 in the same quarter in 1995. International sales were
$853,000 for the six months ended June 30, 1996, compared to $1,158,000 for the
first six months of last year. The decline in international sales is reflective
of economic conditions abroad. It is anticipated that the establishment of a
direct sales office in Europe in April 1996 will enable the Company to gain
increasing market share for its products over the next twelve months.
GROSS PROFIT. Gross profit consists of sales, less cost of goods sold
including materials costs, manufacturing expenses and amortization of software
development costs. Gross profit for the second quarter, 1996 increased by 67.7%
to $3,721,000, from $2,219,000 for the second quarter 1995. Gross margin
improved to 57.6% of sales for the quarter, from 53.5% in the second quarter
1995. Gross profit for the six months ended June 30, 1996 increased 55.0% to
$6,894,000, from $4,447,000 for the first half of 1995. Gross margin improved to
57.5% of sales for the first six months of 1996, from 55.1% for the first half
of 1995. The improved margin is attributable to favorable product mix along with
manufacturing efficiencies associated with higher volumes of business.
OPERATING EXPENSES. Total operating expenses increased to $2,423,000, or
37.5 % of sales for the second quarter 1996, from $1,500,000, or 36.2% of sales
for the comparable 1995 quarter. Total operating expenses increased to
$4,284,000, or 35.7 % of sales for the first half of 1996, from $3,016,000, or
37.3% of sales for the six months ended June 30, 1995.
Selling and marketing expenses increased to $889,000, or 13.8% of sales
for the second quarter 1996, from $481,000, or 11.6% of sales for the same
quarter in 1995. Selling and marketing expenses increased to $1,569,000, or
13.1% of sales for the six months ended June 30, 1996, from $952,000, or 11.8%
of sales for the first half of 1995. The majority of the increase in sales and
marketing expenses in 1996 is attributable to higher advertising and marketing
expenses including those associated with the launch of the new Ethernet Protocol
Switch, Nebula 2000 and its StarGazer Network Management Software at two major
computer shows. Meaningful revenues from these new switching products are not
anticipated until late in the year.
Research and development expenses were $729,000, or 11.3% of sales for the
second quarter 1996, compared to $372,000, or 9.0% of sales for the comparable
1995 quarter. Research and development expenses were $1,322,000, or 11.0% of
sales for the six months ended June 30, 1996, compared to $744,000, or 9.2% of
sales for the six months ended June 30, 1995. Research and development expenses
consist primarily of employee salary and benefit costs, cost of materials
consumed in developing and designing new products and, to a lesser extent,
contract product development and equipment rental. Certain engineering expenses
associated with the
<PAGE>
development of software are capitalized and amortized to cost of goods sold.
Research and development expenses increased during the first and second quarter
of 1996, primarily reflecting higher engineering staff levels which are expected
to increase throughout the remainder of the year.
General and administrative expenses increased to $805,000, or 12.5% of
sales for the second quarter 1996, compared to $647,000, or 15.6% of sales for
the second quarter 1995. General and administrative expenses increased to
$1,393,000, or 11.6% of sales for the six months ended June 30, 1996, compared
to $1,320,000, or 16.3% of sales for the first half of 1995. The increase in
general and administrative expenses of 5.5% for the first six months of this
year reflects additions of administrative personnel, corporate-wide incentives
and corporate costs associated with being a public company, offset by reductions
in certain overhead expenses.
INCOME TAXES. The provision for income taxes was $558,000 in the second
quarter, 1996, compared to $231,000 for the same quarter in 1995. The effective
corporate income tax rate for the second quarter of 1996 was 37.8%, compared to
30.6% for the second quarter of 1995. For the six months ended June 30, 1996,
the provision for income taxes amounted to $1,086,000, compared to $484,000 for
the first six months of 1995. The effective corporate income tax rate was 37.2%,
compared to 31.9% for the first six months of 1995. The increase in the
effective corporate income tax rate during 1996 is due to the utilization of
research and development tax credits in 1995. As a result of UconX Corporation
becoming a wholly owned subsidiary, UconX will be included in the Company's
consolidated corporate income tax returns beginning in April, 1996.
LIQUIDITY AND CAPITAL RESOURCES
At June 30, 1996, the Company's primary source of liquidity included cash
and cash equivalents of $13,729,000 and available borrowings of $2,000,000 under
a demand loan agreement with a bank. The Company had working capital of
$19,273,000 at June 30, 1996, compared to $18,408,000 at March 31, 1996, and
$6,215,000 at December 31, 1995.
Cash provided by operating activities for the six months ended June 30,
1996 was $754,000, compared to $1,501,000 for the same period in 1995. The
Company had a zero balance on its bank credit line at June 30, 1996.
Cash used in investing activities for the six months ended June 30, 1996
included the purchases of equipment in the amount of $581,000, the
capitalization of certain software development costs of $196,000 and the cash
payments associated with the purchase of additional interest in its subsidiary
of $93,000.
Cash provided by financing activities for the six months ended June 30,
1996 was $11,371,000. On January 30, 1996, the Company completed an initial
public offering of 2,000,000 shares of Common Stock through Wheat, First
Securities, Inc. as representative of the underwriters (the "Public Offering").
The net proceeds of the Public Offering were $11,413,000. The Company intends to
use the proceeds from the Public Offering for working capital and general
corporate purposes.
Management believes that the net proceeds of the Public Offering, together
with cash generated from operations and available borrowings under the Company's
Demand Loan Agreement will provide adequate funds for the Company's anticipated
needs, including working capital, for at least the twelve months following the
Public Offering. Management also believes that cash provided from operations
will be sufficient to satisfy all existing debt obligations as they mature.
<PAGE>
Performance Technologies, Incorporated and Subsidiaries
Part II. Other Information
Item 4. Submission of Matters to Vote of Security Holders
The 1996 Annual Meeting of Stockholders was held on June 5,
1996. The Directors elected at the meeting were as follows:
Votes Cast
Nominees For Abstain
--------- -------
Charles E. Maginness 3,749,930 4,200
Bernard Kozel 3,749,930 4,200
The stockholders voted to ratify the appointment of Price
Waterhouse LLP as independent accountants for 1996. 3,748,830 shares of common
stock were voted in favor of the proposal, 1,700 shares of common stock voted
against the proposal and 3,600 shares of common stock abstained.
The stockholders also voted to approve an amendment to and
restatement of the Performance Technologies, Incorporated Stock Option Plan.
3,387,473 shares of common stock voted in favor of the proposal, 98,937 shares
of common stock voted against the proposal and 7,720 shares of common stock
abstained.
Item 6. Exhibits and Reports on Form 8-K
A. Exhibits
Exhibit 11 - Computation of earnings per share.
B. Reports on Form 8-K
There were no reports on Form 8-K filed during the three month period
ended June 30, 1996.
<PAGE>
Performance Technologies, Incorporated and Subsidiaries
Exhibit 11 - Computation of Earnings Per Share
For the Three and Six Months Ending June 30, 1996 and 1995
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
1996 1995 1996 1995
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Weighted average common and common share equivalents:
Weighted average common shares
outstanding during the period 4,774,000 3,059,000 4,553,000 3,061,000
Weighted average common
share equivalents 194,000 227,000 168,000 227,000
----------- ----------- ----------- -----------
4,968,000 3,286,000 4,721,000 3,288,000
=========== =========== =========== ===========
Net Income $910,000 $517,000 $1,807,000 $957,000
=========== =========== =========== ===========
Earnings per share:
Income from continuing operations $0.18 $0.16 $0.38 $0.30
----------- ----------- ----------- -----------
Loss from discontinued operations (0.01)
----------- ----------- ----------- -----------
Net income $0.18 $0.16 $0.38 $0.29
----------- ----------- ----------- -----------
</TABLE>
<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.
PERFORMANCE TECHNOLOGIES, INCORPORATED
August 14, 1996 By: s/ Charles E. Maginness
-----------------------------
Charles E. Maginness
Chairman of the Board of Directors and
Chief Executive Officer
August 14, 1996 By: s/ Dorrance W.Lamb
-----------------------------
Dorrance W. Lamb
Chief Financial Officer and
Vice President, Finance
<TABLE> <S> <C>
<S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE JUNE 30, 1996 FINANCIAL STATEMENTS OF PERFORMANCE
TECHNOLOGIES, INC. AND SUBSIDIARIES AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0001003950
<NAME> PERFORMANCE TECHNOLOGIES, INC.
<MULTIPLIER> 1000
<CURRENCY> US
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> Dec-31-1996
<PERIOD-START> Apr-01-1996
<PERIOD-END> Jun-30-1996
<EXCHANGE-RATE> 1
<CASH> 13,729
<SECURITIES> 0
<RECEIVABLES> 2,998
<ALLOWANCES> 0
<INVENTORY> 4,424
<CURRENT-ASSETS> 21,731
<PP&E> 2,843
<DEPRECIATION> 1,765
<TOTAL-ASSETS> 23,498
<CURRENT-LIABILITIES> 2,458
<BONDS> 176
0
0
<COMMON> 49
<OTHER-SE> 20,658
<TOTAL-LIABILITY-AND-EQUITY> 23,498
<SALES> 6,463
<TOTAL-REVENUES> 6,463
<CGS> 2,742
<TOTAL-COSTS> 2,423
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 1,473
<INCOME-TAX> 558
<INCOME-CONTINUING> 910
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 910
<EPS-PRIMARY> 0.18
<EPS-DILUTED> 0.18
</TABLE>
