<PAGE>
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 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: 0-28212
SUNQUEST INFORMATION SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
PENNSYLVANIA 86-0378223
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification Number)
4801 East Broadway Boulevard
Tucson, Arizona 85711
(Address of principal executive office) (Zip Code)
(520) 570-2000
(Registrant's telephone number, including area code)
Not Applicable
(Former name, former address, and former fiscal year, if changed since last
report)
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
On August 9, 1996, there were 15,354,000 shares of Common Stock outstanding.
<PAGE>
Sunquest Information Systems, Inc.
Form 10-Q
For the Quarterly Period Ended June 30, 1996
Table of Contents
<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
Part I. Financial Information
Item 1. Interim Financial Statements
(a.) Condensed consolidated balance sheets 3
as of June 30, 1996 (unaudited) and December
31, 1995
(b.) Condensed consolidated statements of 4
income for the three and six months ended
June 30, 1996 and June 30, 1995 (unaudited)
(c.) Condensed consolidated statements of 5
cash flows for the six months ended June 30,
1996 and June 30, 1995 (unaudited)
(d.) Notes to condensed consolidated 6
financial statements
Item 2. Management's Discussion and Analysis of 8
Financial Condition and Results of Operations
Part II. Other Information
Item 1. Legal Proceedings 12
Item 2. Changes in Securities 12
Item 3. Defaults Upon Senior Securities 12
Item 4. Submission of Matters to a Vote of Security 12
Holders
Item 5. Other Information 12
Item 6. Exhibits and Reports on Form 8-K 12
(a.) Exhibits 12
11B. Computation of pro forma net income
per share
11B.1 Computation of supplemental pro forma
net income per share
(b.) Reports on Form 8-K 12
</TABLE>
2
<PAGE>
Part I.
Item 1. Interim Financial Statements
Sunquest Information Systems, Inc.
Condensed Consolidated Balance Sheets
(In thousands)
<TABLE>
<CAPTION>
June 30, December 31,
1996 1995
---------- ------------
(unaudited)
<S> <C> <C>
ASSETS
Cash and cash equivalents $40,383 $ 352
Trade receivables, net 19,458 17,054
Loans receivable and accrued interest 5 537
from related party
Other current assets 3,358 2,797
Deferred tax asset 1,081 --
---------- ------------
Total current assets 64,285 20,740
Property and equipment, net 6,931 7,077
Capital leases from related party, net 5,284 5,680
Software development costs, net 7,197 6,777
Loans receivable from related party -- 3,116
Other assets 466 484
---------- ------------
Total assets $84,163 $43,874
========== ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable $ 1,956 $ 1,987
Line of credit -- 1,900
Current portion of long-term debt -- 200
Accrued compensation and related taxes 3,209 2,846
Accrued expenses 1,482 1,194
Obligations under capital leases from
related party 560 511
Deferred revenue 9,298 7,759
Related party payable 3,900 380
---------- ------------
Total current liabilities 20,405 16,777
Obligations under capital leases from
related party 6,104 6,396
Deferred income taxes 2,188 --
Shareholders' equity 55,466 20,701
---------- ------------
Total liabilities and shareholders'
equity $84,163 $43,874
========== ============
</TABLE>
See accompanying notes.
3
<PAGE>
Sunquest Information Systems, Inc.
Condensed Consolidated Statements of Income
(In thousands, except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Six Months
Ended Ended
June 30, June 30,
----------------- -----------------
1996 1995 1996 1995
------- ------- ------- -------
Revenues:
<S> <C> <C> <C> <C>
System sales $11,421 $ 7,633 $19,978 $14,594
Support and service 8,501 7,523 16,661 14,126
------- ------- ------- -------
Total revenues 19,922 15,156 36,639 28,720
Operating expenses:
Cost of system sales 4,878 2,837 8,530 6,531
Client services 4,321 4,542 8,990 9,006
Research and development 2,355 2,288 4,742 4,440
Sales and marketing 2,744 2,174 5,144 4,218
General and administrative 2,121 1,778 4,053 3,633
------- ------- ------- -------
Total operating expenses 16,419 13,619 31,459 27,828
------- ------- ------- -------
Operating income 3,503 1,537 5,180 892
Other income (expense):
Interest income 260 100 350 226
Interest expense (352) (359) (739) (724)
Other 96 (39) 282 (30)
------- ------- ------- -------
Income before income taxes 3,507 1,239 5,073 364
Income tax provision:
Current year operations 446 24 477 7
Change in tax status 1,122 - 1,122 -
------- ------- ------- -------
Net income $ 1,939 $ 1,215 $ 3,474 $ 357
======= ======= ======= =======
Pro forma net income:
Historical income before income taxes $ 3,507 $ 1,239 $ 5,073 $ 364
Pro forma income taxes at 43% 1,508 533 2,181 157
------- ------- ------- -------
Pro forma net income $ 1,999 $ 706 $ 2,892 $ 207
======= ======= ======= =======
Weighted average shares outstanding 13,054 11,904 12,479 11,904
======= ======= ======= =======
Pro forma net income per share $0.15 $0.06 $0.23 $0.02
======= ======= ======= =======
Supplemental pro forma shares
outstanding 12,763 12,851 12,701 12,886
======= ======= ======= =======
Supplemental pro forma net income per
share $0.16 $0.05 $0.23 $0.02
======= ======= ======= =======
</TABLE>
See accompanying notes.
4
<PAGE>
Sunquest Information Systems, Inc.
Condensed Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
-----------------------------
1996 1995
----------- ---------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 3,474 $ 357
Adjustments to reconcile net income to
net cash provided by operating
activities:
Depreciation and amortization 2,508 2,152
Bad debt expense 210 195
Deferred revenue 1,539 (516)
Deferred income taxes 1,107 --
Increase in cash surrender value of life insurance -- (94)
Changes in operating assets and liabilities:
Receivables (2,614) 3,579
Inventory (709) (122)
Prepaid expenses and other 135 (225)
Other assets 30 (342)
Accounts payable (31) (1,007)
Accrued compensation and related taxes 363 (204)
Other accrued expenses 288 (279)
-------- ------
Net cash provided by operating activities 6,300 3,494
-------- ------
Cash flows from investing activities:
Repayment (issuance) of notes receivable from related party 3,268 (141)
Purchase of property and equipment (904) (1,524)
Capitalized software development costs (1,481) (1,379)
-------- ------
Net cash provided by (used in) investing activities 883 (3,044)
-------- ------
Cash flows from financing activities:
Net repayments on line of credit (1,900) --
Principal payments on debt (200) (150)
Principal payments on capitalized leases from related party (243) (203)
Net proceeds from issuance of stock 50,234 (50)
S corporation distributions (15,031) (1,233)
-------- ------
Net cash provided by (used in) financing activities 32,860 (1,636)
-------- ------
Foreign currency translation adjustment (12) (1)
-------- ------
Net increase (decrease) in cash and cash equivalents 40,031 (1,187)
Cash and cash equivalents at beginning of period 352 1,189
-------- ------
Cash and cash equivalents at end of period $ 40,383 $ 2
======== ======
</TABLE>
See accompanying notes.
5
<PAGE>
Notes to Condensed Consolidated Financial Statements
Note 1 - Interim Statement Presentation
The unaudited consolidated financial statements have been prepared by the
Company pursuant to the rules and regulations of the Securities and Exchange
Commission and in accordance with generally accepted accounting principles for
the preparation of interim financial statements. Accordingly, certain
information and footnote disclosures normally included in annual financial
statements have been omitted or condensed. It is suggested that these
consolidated financial statements be read in conjunction with the combined
financial statements and the notes thereto included in the Company's
Registration Statement on Form S-1 filed pursuant to the Securities Act of 1933
(Registration No. 333-2790). The 1995 balance sheet amounts are derived from
audited statements.
In the opinion of management, all necessary adjustments have been made to
provide a fair presentation. The operating results for the three and six months
ended June 30, 1996 are not necessarily indicative of the results that may be
expected for any other interim period or for the full year ending December 31,
1996.
Note 2 - Initial Public Offering
On June 10, 1996, the Company completed its initial offering of stock to the
public. A total of 3,450,000 shares of Common Stock were sold for net proceeds
to the Company of approximately $50.2 million, after deducting expenses of the
offering of approximately $1.1 million and underwriters' discounts and
commissions.
Prior to May 30, 1996, the Company was taxed as an S corporation. During the
quarter ended June 30, 1996, the Company declared and paid to shareholders of
record as of April 30, 1996 the "First S Corporation Distribution" of $14.5
million, which is estimated to be equal to the Company's undistributed
cumulative S corporation earnings from January 1, 1990 through December 31,
1995. During the three months ended June 30, 1996, and March 31, 1996, the
Company also made distributions of $474,000 and $57,000, respectively, to
shareholders related to the shareholders' tax liabilities on S corporation
taxable earnings. In April 1996, the Company declared, payable to shareholders
of record as of April 30, 1996, the "Second S Corporation Distribution,"
estimated to be $3.9 million, equal to the Company's undistributed cumulative S
corporation taxable earnings from January 1, 1996 through May 29, 1996. The
Company expects to pay the "Second S Corporation Distribution" in full on May
15, 1997.
On May 30, 1996, all of the outstanding stock of Sunquest Europa and Sunquest
Germany was transferred to the Company by certain of its shareholders as a
capital contribution. These entities have been consolidated with the Company
for reporting purposes.
6
<PAGE>
Note 3 - Income Taxes
Prior to May 30, 1996, the Company was taxed as an S corporation and,
accordingly, was not subject to federal and certain state income taxes. As a
result, the Company's shareholders, rather than the Company, were required to
pay federal and certain state income taxes based on the Company's taxable
earnings through May 29, 1996, whether or not the earnings were distributed to
such shareholders. The Company had provided for income taxes in states in which
it operated that did not recognize S corporation status. On May 30, 1996, the
Company's S corporation status terminated and, accordingly, the Company has
become subject to federal and state income taxes. This change in tax status
resulted in the Company recording a $1.1 million tax provision in the quarter
ended June 30, 1996.
For the period following the termination of the S corporation status through
June 30, 1996, the Company provided for taxes at a rate of approximately 43% of
pretax income.
Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial accounting
purposes and the amounts used for income tax purposes. Significant components
of the Company's deferred tax liabilities and assets are as follows (in
thousands):
<TABLE>
<CAPTION>
Deferred tax liabilities:
-------------------------
<C> <C>
Tax over book amortization $2,039
Tax over book depreciation 149
------
Total deferred tax liabilities 2,188
Deferred tax assets:
--------------------
Bad debt reserve 505
Vacation and compensation accruals 488
Other 88
------
Total deferred tax assets 1,081
------
Net deferred tax liabilities $1,107
======
</TABLE>
Note 4 - Pro Forma Net Income and Net Income Per Share Information
Pro forma net income has been computed as if the Company had been subject to
federal and all applicable state income taxes based on an estimated tax rate of
43%. Pro forma net income per share is based on the weighted average number of
shares of Common Stock outstanding during the period. Common share equivalents
consist of shares issuable upon exercise of stock options using the treasury
stock method and were not dilutive for the periods presented.
Supplemental pro forma net income per share amounts have been computed giving
effect to the assumed issuance, as of the beginning of the periods presented, of
the number of common shares necessary to replace the equity distributed as a
result of the "First S Corporation Distribution" of $14.5 million from the
proceeds of the initial public offering.
7
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Sunquest Information Systems, Inc. designs, develops, markets,
installs and supports health care information systems for large and mid-sized
hospitals, clinics and other facilities, including integrated delivery networks.
Total revenues are derived from the licensing of software, the provision of
value-added services and the sale of related hardware.
The results of operations for the three and six months ended June 30,
1996 are not necessarily indicative of the results that may be expected for any
other interim period or for the full year ending December 31, 1996.
Results of Operations
- ---------------------
Comparison of Three Months Ended June 30, 1996 and June 30, 1995
Revenues. The Company's total revenues were $19.9 million for the
three months ended June 30, 1996 compared to $15.1 million for the three months
ended June 30, 1995, an increase of $4.8 million, or 31.4%. Revenues from
system sales were $11.4 million for the three months ended June 30, 1996
compared to $7.6 million for the three months ended June 30, 1995, an increase
of $3.8 million, or 49.6%. This increase was primarily attributable to
increased hardware and operating system deliveries related to the start of
several software installations during the quarter. Revenues from support and
service were $8.5 million for the three months ended June 30, 1996 compared to
$7.5 million for the three months ended June 30, 1995, an increase of $978,000,
or 13%. This increase was primarily attributable to the Company's increased
installed customer base.
At June 30, 1996, the Company had a total contract backlog of $71.7
million, which consisted of $35.7 million of system sales and $36.0 million of
support and service. At June 30, 1995, total contract backlog was $52.5
million, which consisted of $27.1 million of system sales and $25.4 million of
support and service.
Cost of System Sales. Cost of system sales was $4.9 million for the
three months ended June 30, 1996 compared to $2.8 million for the three months
ended June 30, 1995, an increase of $2.0 million, or 71.9%. This increase was
primarily attributable to increases in hardware and operating system deliveries.
Amortization of previously capitalized software development costs was $531,000
for the three months ended June 30, 1996 compared to $432,000 for the three
months ended June 30, 1995, an increase of $99,000, or 22.9%.
Client Services. Client services expenses were $4.3 million for the
three months ended June 30, 1996 compared to $4.5 million for the three months
ended June 30, 1995, a decrease of $221,000, or 4.9%. The decrease was
primarily attributable to staff reductions attained through improved operating
efficiencies.
8
<PAGE>
Research and Development. Research and development expenses were $2.4
million for the three months ended June 30, 1996 compared to $2.3 million for
the three months ended June 30, 1995, an increase of $67,000, or 2.9%. The
increase in research and development expenses was primarily attributable to
increased enhancements to the managed care system and development of a clinical
documentation system. The Company capitalized $684,000 of its software
development costs for the three months ended June 30, 1996 compared to $711,000
for the three months ended June 30, 1995.
Sales and Marketing. Sales and marketing expenses were $2.7 million
for the three months ended June 30, 1996 compared to $2.2 million for the three
months ended June 30, 1995, an increase of $570,000, or 26.2%. This increase
was primarily attributable to increased sales and marketing staff, increased
commissions resulting from growth in sales bookings in the comparable three
month periods, and timing of expenses related to the yearly user group meeting
which occurred in the second quarter of 1996 compared to the third quarter of
1995.
General and Administrative. General and administrative expenses were
$2.1 million in the three months ended June 30, 1996 compared to $1.8 million in
the three months ended June 30, 1995, an increase of $343,000, or 19.3%. This
increase was primarily attributable to increased accruals for compensation
relating to increased levels of operating income.
Comparison of Six Months Ended June 30, 1996 and June 30, 1995
Revenues. The Company's total revenues were $36.6 million for the six
months ended June 30, 1996 compared to $28.7 million for the six months ended
June 30, 1995, an increase of $7.9 million, or 27.6%. Revenues from system
sales were $20.0 million for the six months ended June 30, 1996 compared to
$14.6 million for the six months ended June 30, 1995, an increase of $5.4
million, or 36.9%. This increase was primarily attributable to an increase in
installations of products for both existing and new customers. Revenues from
support and service were $16.7 million for the six months ended June 30, 1996
compared to $14.1 million for the six months ended June 30, 1995, an increase of
$2.6 million, or 17.9%. This increase was primarily attributable to the
Company's increased installed customer base.
Cost of System Sales. Cost of system sales was $8.5 million for the
six months ended June 30, 1996 compared to $6.5 million for the six months ended
June 30, 1995, an increase of $2.0 million, or 30.6%. This increase was
primarily attributable to increases in hardware and operating system deliveries.
Amortization of previously capitalized software development costs was $1.1
million for the six months ended June 30, 1996 compared to $864,000 for the six
months ended June 30, 1995, an increase of $198,000, or 22.9%.
Client Services. Client services expenses were $9.0 million for each
of the six-month periods ended June 30, 1996 and 1995.
9
<PAGE>
Research and Development. Research and development expenses were $4.7
million for the six months ended June 30, 1996 compared to $4.4 million for the
six months ended June 30, 1995, an increase of $302,000, or 6.8%. The increase
in research and development expenses was primarily attributable to increased
quality control testing, enhancements to the managed care system and development
of a clinical documentation system. The Company capitalized $1.5 million of its
software development costs for the six months ended June 30, 1996 compared to
$1.4 million for the six months ended June 30, 1995.
Sales and Marketing. Sales and marketing expenses were $5.1 million
for the six months ended June 30, 1996 compared to $4.2 million for the six
months ended June 30, 1995, an increase of $926,000, or 22%. This increase was
primarily attributable to increased sales and marketing staff, increased
commissions resulting from growth in sales bookings in the comparable six month
periods, increased promotional allowances, and timing of expenses related to the
yearly user group meeting.
General and Administrative. General and administrative expenses were
$4.1 million in the six months ended June 30, 1996 compared to $3.6 million in
the six months ended June 30, 1995, an increase of $420,000, or 11.6%. This
increase was primarily attributable to increased accruals for compensation
relating to increased levels of operating income.
Liquidity and Capital Resources
- -------------------------------
Cash provided by operating activities was $6.3 million for the six
months ended June 30, 1996 compared to $3.5 million for the six months ended
June 30, 1995.
As of June 30, 1996, the Company had billed trade receivables of
$17.8 million. The Company maintains an allowance for doubtful accounts that it
believes is adequate to cover potential credit losses. The average collection
period on trade receivables was 67 days at June 30, 1996 compared to 63 days at
December 31, 1995.
Cash provided by investing activities was $883,000 for the six months
ended June 30, 1996. Cash of $3.3 million was received in payment of a note
receivable from a related party in connection with the purchase by the related
party of an office complex which it subsequently leased to the Company.
Purchases of property and equipment, consisting primarily of business
information software for internal use and computer-related equipment, were
$904,000 for the six months ended June 30, 1996. The remainder of cash used in
investing activities was for capitalized software development costs.
Cash and cash equivalents at June 30, 1996 were $40.4 million, an
increase of $40.0 million from December 31, 1995. The majority of the increase
was due to receipt of the proceeds from the Company's initial public offering of
Common Stock which was completed in June, 1996. Proceeds from the offering, net
of related costs, were $50.2 million partially offset by S corporation
distributions of $15.0 million to the Company's shareholders for the "First S
Corporation Distribution" and for shareholders' tax liabilities associated with
the Company's taxable earnings.
10
<PAGE>
The Company has a revolving line of credit with a bank allowing the
Company to borrow up to $10.0 million. Any borrowings under the line of credit
will bear interest at the bank reference rate unless the Company elects a fixed
rate or certain variable rates contemplated by the agreement. There were no
borrowings as of June 30, 1996.
The Company has no significant commitments for capital expenditures at
this time. The Company expects to pay the "Second S Corporation
Distribution," estimated to be $3.9 million, in full on May 15, 1997 from
internally generated funds.
Management believes that existing cash and cash equivalents together
with funds generated from operations will be sufficient to meet operating
requirements for the next twelve months.
11
<PAGE>
Part II.
Item 1. Legal Proceedings
Not Applicable.
Item 2. Changes in Securities
None.
Item 3. Defaults Upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Item 5. Other Information
None.
Item 6. Exhibits and Reports on Form 8-K
(a.) Exhibits
The following exhibits are filed herewith as a part of this
report:
11B. Computation of pro forma net income per share
11B.1 Computation of supplemental pro forma net income per
share
(b.) Reports on Form 8-K
No reports on Form 8-K were filed by the Company during the
quarter ended June 30, 1996.
SIGNATURES
Pursuant to the requirement 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.
SUNQUEST INFORMATION SYSTEMS, INC.
(Registrant)
Date: August 12, 1996 By: /s/ Nina M. Dmetruk
------------------------------------------
Nina M. Dmetruk
Executive Vice President and Chief Financial
Officer
(Principal Financial and Accounting Officer)
12
<PAGE>
Exhibit 11B.
Sunquest Information Systems, Inc.
Computation of Pro Forma Net Income Per Share
(In thousands, except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
------------------ -----------------
1996 1995 1996 1995
------- ------- ------- -------
<S> <C> <C> <C> <C>
Total number of common shares outstanding 11,904 11,904 11,904 11,904
Weighted average common shares issued
through initial public offering 1,150 -- 575 --
Weighted average shares outstanding 13,054 11,904 12,479 11,904
======= ======= ======= =======
Pro forma net income $ 1,999 $ 706 $ 2,892 $ 207
======= ======= ======= =======
Pro forma net income per share $ 0.15 $ 0.06 $ 0.23 $ 0.02
======= ======= ======= =======
</TABLE>
<PAGE>
Exhibit 11B.1
Sunquest Information Systems, Inc.
Computation of Supplemental Pro Forma Net Income Per Share
(In thousands, except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
---------------------- -----------------------
1996 1995 1996 1995
------- ------- -------- -------
<S> <C> <C> <C> <C>
Pro forma net income $ 1,999 $ 706 $ 2,892 $ 207
======= ======= ======= =======
SHARE INFORMATION
Dividends $14,500 (1) $14,500 (1) $14,500 (1) $14,500 (1)
Pro forma net income (1,999) (706) (2,892) (207)
------- ------- ------- -------
Dividends in excess of earnings $12,501 $13,794 $11,608 $14,293
======= ======= ======= =======
INCREMENTAL SHARES/EARNINGS PER SHARE
Dividends in excess of earnings $12,501 $13,794 $11,608 $14,293
Divided by net proceeds per share (2) 14.56 14.56 14.56 14.56
------- ------- ------- -------
859 947 797 982
Historic shares outstanding 11,904 11,904 11,904 11,904
------- ------- ------- -------
Supplemental pro forma shares outstanding 12,763 12,851 12,701 12,886
------- ------- ------- -------
Supplemental pro forma earnings per share $ 0.16 $ 0.05 $ 0.23 $ 0.02
======= ======= ======= =======
</TABLE>
(1) The "Second S Corporation Distribution" declared by the Company in April
1996 has not been included because such dividend will not be paid from the
proceeds of the offering.
(2) Proceeds from offering:
<TABLE>
<CAPTION>
<S> <C>
Shares sold including overallotment 3,450
Offering price per share $ 16.00
-------
$55,200
Underwriter's discount (3,864)
Offering costs (1,102)
-------
Net proceeds $50,234
=======
Net proceeds per share $ 14.56
=======
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C> <C>
<PERIOD-TYPE> 6-MOS 6-MOS
<FISCAL-YEAR-END> DEC-31-1996 DEC-31-1995
<PERIOD-START> JAN-01-1996 JAN-01-1995
<PERIOD-END> JUN-30-1996 JUN-30-1995
<CASH> 40,383 2
<SECURITIES> 0 0
<RECEIVABLES> 20,745 11,029
<ALLOWANCES> 1,287 1,168
<INVENTORY> 2,334 2,228
<CURRENT-ASSETS> 64,285 14,911
<PP&E> 13,449 15,438
<DEPRECIATION> 6,518 8,962
<TOTAL-ASSETS> 84,163 38,782
<CURRENT-LIABILITIES> 20,405 11,744
<BONDS> 0 0
0 0
0 0
<COMMON> 50,308 57
<OTHER-SE> 5,158 20,267
<TOTAL-LIABILITY-AND-EQUITY> 84,163 38,782
<SALES> 36,639 28,720
<TOTAL-REVENUES> 36,639 28,720
<CGS> 8,530 6,531
<TOTAL-COSTS> 17,520 15,537
<OTHER-EXPENSES> 4,742 4,440
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 739 724
<INCOME-PRETAX> 5,073 364
<INCOME-TAX> 1,599 7
<INCOME-CONTINUING> 3,474 357
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 3,474 357
<EPS-PRIMARY> 0.23 0.02
<EPS-DILUTED> 0.23 0.02
</TABLE>
