U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
(Mark One)
[X] Quarterly report under Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the quarterly period ended June 30, 1996
------------------
[ ] Transition report under Section 13 or 15(d) of the Exchange Act
For the transition period from _________ to ______
Commission file number 0-28282
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THE LION BREWERY, INC.
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(Exact Name of Small Business Issuer as Specified in Its Charter)
PENNSYLVANIA 24-0645190
------------------------ ---------------------
(State or Other (I.R.S. Employer
Jurisdiction of Identification No.)
Incorporation or
Organization)
700 NORTH PENNSYLVANIA AVENUE, WILKES BARRE, PA 18703
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(Address of Principal Executive Offices)
(717) 823-8801
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(Issuer's Telephone Number, Including Area Code)
N/A
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(Former Name, Former Address and Former Fiscal Year,
if Changed Since Last Report)
Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 No X
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APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDING DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to
be filed by Section 12, 13 or 15(d) of the Exchange Act after the
distribution of securities under a plan confirmed by a court.
Yes ________ No ________
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes
of common equity, as of the latest practicable date: August 9, 1996 -
---------------------
3,885,051 shares outstanding
-------------------------------
Transitional Small Business Disclosure Format (check one):
Yes No X
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<PAGE>
THE LION BREWERY, INC.
BALANCE SHEETS
June 30, Sept. 30,
1996 1995
------------ ------------
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents $ 507,000 $ 0
Accounts receivable, less allowance
for doubtful accounts
of $138,000 at June 30, 1996
and $129,000 at September 30,
1995 2,823,000 2,476,000
Inventories 2,264,000 2,003,000
Prepaid expenses and other assets 188,000 277,000
----------- -----------
Total current assets 5,782,000 4,756,000
Property, plant & equipment, net of
accumulated depreciation
of $1,529,000 at June 30, 1996 and
$1,122,000 at September 30, 1995 3,443,000 3,254,000
Goodwill, net of accumulated
amortization of $476,000 at June 30,
1996 and $311,000 at
September 30, 1995 6,080,000 6,203,000
Deferred financing costs and other
assets, net of accumulated
amortization of $144,000 September 4,000 228,000
30, 1995 ----------- -----------
$15,309,000 $14,441,000
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long term debt $ 0 $1 ,745,000
Accounts payable 1,744,000 1,978,000
Accrued expenses 774,000 478,000
Refundable deposits 206,000 171,000
Income taxes payable 0 330,000
----------- -----------
2,724,000 4,702,000
Long-term debt, less current portion 0 6,131,000
Net pension liability 218,000 218,000
Deferred income taxes 253,000 351,000
----------- -----------
Total liabilities 3,195,000 11,402,000
----------- -----------
Warrants 0 722,000
----------- -----------
<PAGE>
June 30, Sept. 30,
1996 1995
------------ -------------
(Unaudited)
Stockholders' equity:
Common stock, $.01 par value;
10,000,000 shares authorized;
3,885,051 and 1,851,183 shares
issued and outstanding at June 30,
1996 and September 30, 1995,
respectively 39,000 19,000
Additional paid-in capital 10,612,000 1,304,000
Adjustment to reflect minimum
pension liability, net of
deferred income taxes (10,000) (10,000)
Retained earnings 1,473,000 1,004,000
----------- -----------
Total stockholders' equity 12,114,000 2,317,000
----------- -----------
Total liabilities and $15,309,000 $14,441,000
stockholders' equity =========== ===========
The accompanying notes to financial statements are an integral part of
these financial statements.
<PAGE>
THE LION BREWERY, INC.
STATEMENTS OF INCOME
(Unaudited)
Three months ended June 30,
----------------------------
1996 1995
---- -----
Gross sales $7,288,000 $6,531,000
Less excise taxes 192,000 105,000
---------- ----------
Net sales 7,096,000 6,426,000
Cost of sales 5,382,000 4,715,000
----------- ----------
Gross profit 1,714,000 1,711,000
----------- ----------
Operating expenses:
Delivery 183,000 217,000
Selling, advertising and
promotional expenses 298,000 215,000
General and administrative 367,000 316,000
---------- ----------
848,000 748,000
---------- ----------
Operating income 866,000 963,000
Interest expense and amortization 83,000 258,000
of debt discount ---------- ----------
Income before provision for
income taxes and
extraordinary item 783,000 705,000
Provision for income taxes 345,000 329,000
---------- ----------
Income before extraordinary
item 438,000 376,000
Extraordinary item, net of income
tax benefit of $228,000 322,000 0
---------- ----------
Net income 116,000 376,000
Warrant accretion 0 175,000
---------- ----------
Net income available to common $ 116,000 $ 201,000
shareholders ========== ==========
Income per share before
extraordinary item per share $ 0.13 $ 0.11
========= ==========
Net income per share $ 0.02 $ 0.11
========= ==========
Weighted average shares outstanding 3,323,000 1,898,000
========= =========
Nine months ended June 30,
--------------------------
1996 1995
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Gross sales $19,274,000 $18,097,000
Less excise taxes 393,000 281,000
----------- -----------
Net sales 18,881,000 17,816,000
Cost of sales 14,312,000 13,562,000
----------- -----------
Gross profit 4,569,000 4,254,000
----------- -----------
Operating expenses:
Delivery 592,000 631,000
Selling, advertising and
promotional expenses 772,000 602,000
General and 1,071,000 1,020,000
administrative ---------- ------------
2,435,000 2,253,000
---------- ------------
Operating income 2,134,000 2,001,000
Interest expense and 548,000 805,000
amortization of debt discount --------- ------------
Income before provision
for income taxes and
extraordinary item 1,586,000 1,196,000
Provision for income taxes 705,000 558,000
--------- ------------
Income before
extraordinary item 881,000 638,000
Extraordinary item, net of
income tax benefit of $228,000 322,000 0
--------- ------------
Net income 559,000 638,000
Warrant accretion 89,000 175,000
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Net income available to common $ 470,000 $ 463,000
shareholders =========== ===========
Income per share before
extraordinary item per share $ 0.32 $ 0.24
=========== ===========
Net income per share $ 0.19 $ 0.24
========== ==========
Weighted average shares 2,469,000 1,898,000
outstanding ========== ==========
The accompanying notes to financial statements are an integral part of
these financial statements.
<PAGE>
THE LION BREWERY, INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Nine months ended June 30,
----------------------------
1996 1995
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<S> <C> <C>
Cash flows from operating activities:
Net income $559,000 $ 638,000
Adjustments to reconcile net income to net cash
provided by operating activities:
Extraordinary item 550,000 0
Depreciation and amortization 633,000 673,000
Bad debt expense 9,000 27,000
Provision for inventory reserve 60,000 0
Benefit for deferred income taxes (98,000) (105,000)
Changes in assets and liabilities:
(Increase) decrease in:
Accounts receivable (356,000) (109,000)
Inventories (321,000) (256,000)
Prepaid expenses and other assets 89,000 270,000
Increase (decrease) in:
Accounts payable, accrued expenses
and refundable deposits 97,000 (40,000)
Income taxes payable (330,000) 277,000
Pension liability 0 (7,000)
----------- ----------
Cash provided by operating 892,000 1,368,000
activities ----------- ----------
Cash flows from investing activities: (596,000) (230,000)
Purchase of equipment ----------- ----------
Cash flows from financing activities:
Net proceeds from sale of common stock 9,466,000 0
Repurchase of common stock (950,000) 0
Deferred financing costs 0 (26,000)
Issuance of long term debt 0 500,000
Net additions (reductions) in line of credit (721,000) (687,000)
Repayments of long term debt (7,584,000) (1,066,000)
----------- ----------
Net cash provided by (used in) financing 211,000 (1,279,000)
activities ----------- ----------
Net increase (decrease) in cash 507,000 (141,000)
Cash and cash equivalents, beginning of year 0 141,000
----------- ----------
Cash and cash equivalents, end of year $ 507,000 $ 0
=========== ==========
Supplementary disclosure of cash flow information:
Cash paid for: $ 517,000 $ 725,000
Interest ========== ===========
Income taxes $ 940,000 $ 333,000
========== ===========
</TABLE>
The accompanying notes to financial statements are an integral part
of these financial statements.
<PAGE>
THE LION BREWERY, INC.
NOTES TO FINANCIAL STATEMENTS
1. BASIS OF PRESENTATION:
The financial statements and accompanying information as of June 30,
1996 and for the three and nine month periods ended June 30, 1996 and
1995 are unaudited but, in the opinion of management, include all
adjustments (consisting only of normal recurring adjustments and
accruals) which the Company considers necessary for a fair
presentation of the financial position of the Company at such dates
and the operating results and cash flows for those periods. Results
for the interim periods are not necessarily indicative of results for
the entire year. The interim financial statements and the related
notes should be read in conjunction with the notes to the financial
statements of the Company included in the Form SB-2 (File No.
333-1644) declared effective by the Securities and Exchange Commission
on May 1, 1996.
2. PUBLIC OFFERING OF EQUITY SECURITIES:
On May 2, 1996, the Company completed an initial public offering of
equity securities. 1,875,000 shares of common stock were sold for
$6.00 per share by the Company during this offering and the partial
exercise of the over-allotment option. The proceeds of the initial
public offering, including the partial exercise of the over-allotment
option, net of the underwriting commissions and expenses totaled
$9,467,000. A portion of these proceeds were used to repay
indebtedness of the Company of $7,948,000 and to retire 132,696 shares
of Common Stock, in connection with the termination of a loan
agreement, at a cost of $950,000. The repayment of the indebtedness
included the Company's line of credit.
In connection with this offering, the Company issued warrants to the
underwriters to purchase up to 135,000 shares of common stock at an
exercise price of $7.20, which are exercisable for a period of five
years from the date of the offering. The holders have certain rights
to obtain the registration of these shares under the Securities Act.
3. EXTRAORDINARY ITEM:
The extraordinary item consists of prepayment penalties of $160,000,
unamortized debt discounts of $213,000 and the write-off of
unamortized deferred financing costs of $177,000 related to the early
extinguishment of debt, net of an income tax benefit of $228,000.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
OVERVIEW
The Lion Brewery, Inc. is a brewer and bottler of brewed beverages,
including malta, specialty beers and specialty soft drinks. Malta is a
non-alcoholic brewed beverage popular with the Caribbean and certain other
segments of the Hispanic population, which the Company produces for
distribution primarily in the eastern United States. The Company produces
malta for the major Hispanic food distribution companies including Goya
Foods, Vitarroz, Ceverceria India and 7-Up/RC of Puerto Rico and is the
dominant producer of malta in the continental United States Specialty
beers, generally known as craft beers, are brewed by the Company for both
sale under its own brands (label) and on a contract basis for other
breweries and marketers of craft beer brands. Craft beers are
distinguishable from other domestically produced beers by their fuller
flavor and adherence to traditional European brewing styles. The Company
also produces specialty soft drinks, including all-natural brewed ginger
beverages, on a contract basis for third parties. In addition, the Company
brews beer for sale under traditional Company-owned labels for the local
market at popular prices.
The Company label craft beers include 1857 Premium Lager, Stegmaier Porter,
Liebotschaner Cream Ale, Brewery Hill Black and Tan, Brewery Hill Honey
Amber, Brewery Hill Raspberry Red, Brewery Hill Pale Ale and Brewery Hill
Cherry Wheat. Company label beers, brewed in its own brewery, have won
several prestigious awards. The Company's flagship lager, 1857 Premium
Lager, was voted the Best American Premium Lager at the Great American Beer
Festival in 1994. In addition, Liebotschaner Cream Ale won back to back
Gold Medals in the American Lager Cream Ale Category, in 1994 and 1995 at
the Great American Beer Festival. Company brands recently captured the
following medals at the 1996 World Beer Championships:
Brewery Hill Cherry Wheat Gold Medal - 1st Place World Champ
1857 Premium Lager Silver Medal
Stegmaier Gold Medal Beer Silver Medal
The Company's Brewery Hill Honey Amber won the Bronze Award Specialty
category at the 1996 World Beer Cup. Furthermore, the craft beers and
specialty soft drinks brewed under contract have won several awards.
<PAGE>
RESULTS OF OPERATIONS
NINE MONTHS ENDED JUNE 30,1996 AND 1995
GROSS SALES AND EXCISE TAXES
The Company's gross sales increased 6.5% to $19,274,000 in the nine months
ended June 30, 1996 from $18,097,000 in the nine months ended June 30,
1995. Gross sales of craft beer represented 20.1% of gross sales in the
first nine months of fiscal 1996, up from 12.2% in the comparable period of
fiscal 1995.
The Company is required to pay federal and state excise taxes on sales of
its beer. The federal excise tax increases from $7 to $18 per barrel on
production over 60,000 barrels. Total excise taxes increased 39.9% to
$393,000 in the first nine months of fiscal 1996 from $281,000 in the same
period of fiscal 1995. Excise taxes increased in the first nine months of
fiscal 1996, because the excise taxes were accrued at a rate higher than $7
per barrel in expectation that beer production for calendar 1996 will
exceed 60,000 barrels.
NET SALES
The Company's net sales increased 6.0% to $18,881,000 in the nine months
ended June 30, 1996 from $17,816,000 in the nine months ended June 30,
1995. Net sales of craft beer increased 75.5% to $3,602,000 in the first
nine months of fiscal 1996, up from $2,053,000 in the same period of fiscal
1995. Net sales of craft beers produced under the Company's own labels
through the Company's distributor network, which excludes Beers Across
America, a mail order craft beer supplying club, increased 126.6% to
$1,321,000 in the first nine months of fiscal 1996, as compared to $583,000
in the first nine months of fiscal 1995. In fiscal 1995, the Company had
net sales of Company label craft beers of $134,000 to Beers Across America,
which were not repeated in fiscal 1996. Malta sales decreased $711,000 or
5.2% to $12,926,000 in the first nine months of fiscal 1996, from
$13,637,000 in the comparable period of fiscal 1995. The Company expects
this trend to continue throughout the fourth quarter of fiscal 1996. Malta
sales decreased as a percentage of net sales to 68.5% in the first nine
months of fiscal 1996, as compared to 76.5% in the first nine months of
fiscal 1995. This decrease is primarily the result of growth in net sales
of Company label craft beers and sales of soft drinks, and to a lesser
extent, the decrease in malta sales. Sales of soft drinks increased
$363,000 or 29.6% in the first nine months of fiscal 1996, as compared to
the same period of fiscal 1995, increasing to $1,590,000 from $1,227,000.
The Company continued its strategy which began in fiscal 1995 to
discontinue some of the slower selling, less profitable popular priced
beers. As a result of this strategy, net sales of popular priced beer
decreased 15.1% to $763,000, in the first nine months of fiscal 1996.
The Company increased sales of its craft beers through increased
penetration in its existing markets, expansion into contiguous regional
markets and new product introductions. New product introductions during
fiscal 1996 included the "Classic Collection" in the first quarter of
fiscal 1996, Brewery Hill Pale Ale in late March 1996 and Brewery Hill
Cherry Wheat in late May 1996. In April 1996, the Company began producing
under contract, One Eyed Jack, an alcoholic lemon brew. During the 3rd
quarter of fiscal 1996, the Company sold 156,000 cases of One Eyed Jack.
One Eyed Jack is currently distributed in 33 states.
GROSS MARGINS
The Company's gross margins (gross profit as a percentage of net sales)
increased to 24.2% in the first nine months of fiscal 1996 from 23.9% in
the first nine months of fiscal 1995. The increase in gross margin was
<PAGE>
primarily the result of the growth in sales of craft beers and, to a lesser
extent, soft drinks. This growth has been offset significantly by lower
paper recycling income and higher malt prices.
DELIVERY EXPENSE
Delivery expense as a percentage of net sales decreased to 3.1% of net
sales, or $592,000, during the first nine months of fiscal 1996 from 3.5%
of net sales or $631,000, during the first nine months of fiscal 1995.
Delivery expense remained at 4.6% of Malta sales during these periods.
Malta products are shipped common carrier at the Company's expense.
Substantially all beer sales are shipped F.O.B. shipping point.
SELLING, ADVERTISING AND PROMOTIONAL EXPENSE
Selling, advertising and promotional expenses increased 28.2% to $772,000
in the first nine months of fiscal 1996 from $602,000 in the comparable
period of fiscal 1995. The increase in selling, advertising and promotional
expenses occurred as the Company began to gear up its Company label craft
beer packaging and sales and marketing efforts. The Company introduced the
"Classic Collection" in late November 1995, Brewery Hill Pale Ale in late
March 1996 and Brewery Hill Cherry Wheat in late May 1996. A significant
portion of the Company's sales and marketing efforts is dedicated to the
introduction of its new labels and the implementation of promotional
programs. In March 1996, the Company hired a Vice President of Sales and
Marketing to spearhead the growth of Company label craft beer sales by
further developing the Company's distribution system in the states it
currently services and in the additional states the Company is expanding
into. The Company plans to significantly increase its selling, advertising
and promotional expenses to further its strategy of rapidly expanding its
marketing of craft beers. Greater emphasis has been placed on developing
and implementing promotional programs on Company label craft beers with the
Company's distributors.
GENERAL AND ADMINISTRATIVE EXPENSES
General and administrative expenses were 5.7% of net sales in the first
nine months of fiscal 1996 and 1995. General and administrative expenses
increased 5.0%, increasing $51,000 to $1,071,000 in the first nine months
of fiscal 1996. The increase is primarily attributable to legal fees, and
insurance and other costs relating to being a public company. The legal fee
increase primarily relate to the negotiation of a four year collective
bargaining contract which expires May 31, 2000.
OPERATING INCOME
Operating income increased 6.7% to $2,134,000, or 11.3% of net sales, in
the first nine months of fiscal 1996 from $2,001,000, or 11.2% of net
sales, for the same period of the previous year. The growth in the
Company's operating income has been offset by lower paper recycling income,
higher malt prices and increased sales and marketing expenditures.
INTEREST EXPENSE
Interest expense decreased 31.9% to $548,000 in the first nine months of
fiscal 1996, from $805,000 in the first nine months of fiscal 1995. The
decrease in interest expense resulted primarily from the repayment of the
debt outstanding with the proceeds from the initial public offering.
PROVISION FOR INCOME TAXES
The effective tax rate was 44% for the first nine months of fiscal 1996 and
47% for the first nine months of fiscal 1995. State income taxes and
nondeductible goodwill amortization impact the effective tax rates.
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
The Company has historically funded operations primarily through cash
generated from operations and bank and other debt. On May 2, 1996, the
Company completed an initial public offering of equity securities. The
proceeds of the initial public offering, including the partial exercise of
the over-allotment option, net of the underwriting commissions and expenses
totaled $9,467,000. A portion of these proceeds were used to repay
indebtedness of the Company of $7,948,000 and to retire 132,696 shares of
Common Stock, in connection with the termination of a loan agreement, at a
cost of $950,000. The repayment of the indebtedness included the Company's
working capital line of credit, which had an outstanding balance of
$920,000. The Company has available $3.0 million under a revolving credit
loan, which matures on September 30, 1996 and bears interest at 1% over the
prime rate. The Company believes that this facility will be renewed or
replaced at maturity, although there is no assurance in this regard. The
amount available for borrowing under the line is based upon a percentage of
eligible accounts receivable and inventory. The Company is currently in
compliance with the financial covenants under its credit facility.
In the process of repaying the debt outstanding with the proceeds of the
offering, the Company incurred extraordinary charges of $550,000, before
income tax benefit. The charges consisted of prepayment penalties of
$160,000, unamortized debt discounts of $213,000 and the write-off of
unamortized deferred financing costs of $177,000 related to the early
extinguishment of debt.
Cash flows provided from operations were $892,000 and $1,368,000 in the
first nine months of fiscal 1996 and 1995, respectively. The cash flows
from operations have been affected by collections of accounts receivable,
changes in inventory levels maintained and income taxes payable. In the
first nine months of fiscal 1995, the Company made several changes to its
credit and collections policies, which resulted in faster collection
periods. The Company has continued these policies through the first nine
months of fiscal 1996. Taking these changes into consideration, the
increase in accounts receivable is consistent with the increase in the
Company's sales. In the first nine months of fiscal 1996, the Company also
significantly increased its inventory of bottles, in anticipation of summer
and fall production requirements. Although the Company's income before
extraordinary items and income taxes increased 32.6% in the first nine
months of fiscal 1996 as compared to the same period in the previous year,
income taxes payable decreased primarily as a result of the tax benefit of
$228,000 generated by the extraordinary charge. In fiscal 1996, the cash
provided from operations was used to purchase equipment and pay costs
related to the offering. A portion of the proceeds from the initial public
offering were used to repay the Company's working capital line of credit
borrowings outstanding. In fiscal 1995, the cash provided from operations
was used to purchase equipment and repay debt.
During the first nine months of fiscal 1996, the Company expended $596,000
on capital improvements. The Company has begun its capital expenditure
program to increase its annual production capacity from 340,000 to 400,000
barrels. The Company is currently adapting the seven ounce bottling line to
also accommodate 12oz. bottles, upgrading the boiler and refurbishing
existing storage tanks.
The Company believes that the net proceeds from the initial public
offering, together with cash flow from operations and borrowing
availability under its revolving credit facility, will be sufficient to
support the Company's capital expenditure and working capital requirements
through the end of fiscal 1997.
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8K
EXHIBIT 27. FINANCIAL DATA SCHEDULE
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
THE LION BREWERY, INC.
--------------------------------------
(Registrant)
Date: August 12, 1996 /s/ Charles E. Lawson
--------------- --------------------------------------
CHARLES E. LAWSON
President and Chief Executive Officer
Date: August 12, 1996 /s/ Patrick E. Belardi
--------------- --------------------------------------
PATRICK E. BELARDI
Vice President and Chief Financial Officer
<PAGE>
EXHIBIT INDEX
Exhibit Description
------- -----------
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
THE LION BREWERY, INC.'S BALANCE SHEETS, STATEMENTS OF INCOME AND
STATEMENTS OF CASH FLOWS FOR THE PERIOD ENDED JUNE 30, 1996, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> JUN-30-1996
<CASH> 507
<SECURITIES> 0
<RECEIVABLES> 2,961
<ALLOWANCES> (138)
<INVENTORY> 2,264
<CURRENT-ASSETS> 5,782
<PP&E> 4,972
<DEPRECIATION> 1,529
<TOTAL-ASSETS> 15,309
<CURRENT-LIABILITIES> 2,724
<BONDS> 0
0
0
<COMMON> 39
<OTHER-SE> 12,075
<TOTAL-LIABILITY-AND-EQUITY> 15,309
<SALES> 7,096
<TOTAL-REVENUES> 7,096
<CGS> 5,382
<TOTAL-COSTS> 5,382
<OTHER-EXPENSES> 848
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 83
<INCOME-PRETAX> 783
<INCOME-TAX> 345
<INCOME-CONTINUING> 438
<DISCONTINUED> 0
<EXTRAORDINARY> 322
<CHANGES> 0
<NET-INCOME> 116
<EPS-PRIMARY> .03
<EPS-DILUTED> .03
</TABLE>
