U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
Quarterly Report under Section 13 or 15(d)
Of the Securities Exchange Act of 1934
For the Quarterly Period Ended Commission File Number
December 31, 1998 0-21867
BISHOP CAPITAL CORPORATION
(Exact name of small business issuer as specified in its charter)
Wyoming 84-0901126
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
716 College View Drive, Riverton, Wyoming 82501
(Address of principal executive offices) (Zip Code)
(307) 856-3800
(Issuer's telephone number)
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 --X-- No ----
The number of shares outstanding of the issuer's $.01 par value Common Stock as
of February 10, 1999 was 877,355.
Transitional Small Business Disclosure Format
(Check one): Yes ---- No --X--
<PAGE>
BISHOP CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
DECEMBER 31, 1998
(Unaudited)
ASSETS
Current Assets:
Cash and equivalents $ 18,121
Restricted cash 89,005
Marketable securities 879,750
Receivables:
Gas royalties 20,030
Interest and other 10,983
Prepaid expenses and other 5,503
-----------
Total current assets 1,023,392
Property and Equipment:
Building 224,644
Furniture and fixtures 66,887
Vehicles and equipment 91,380
-----------
382,911
Less accumulated depreciation (163,297)
-----------
Net property and equipment 219,614
-----------
Other Assets:
Land under development 744,548
Investment in limited partnership 214,513
Gas royalty interest, net of accumulated
amortization of $826,967 240,083
Deferred income taxes 23,000
Notes receivable 73,318
-----------
Total other assets 1,295,462
-----------
Total Assets $ 2,538,468
===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable and accrued expenses $ 125,561
Payable to broker 211,193
Income taxes payable 33,000
Deferred income taxes 98,000
Deferred revenue 57,521
Current maturities of long-term debt 17,758
-----------
Total current liabilities 543,033
Long-term debt, less current maturities 122,242
Stockholders' Equity:
Preferred stock, no par value; 5,000,000
shares authorized, no shares issued --
Common stock, $.01 par value; 15,000,000
shares authorized; 878,365 shares issued 8,784
Capital in excess of par value 2,199,209
Accumulated deficit (333,975)
Treasury stock, at cost, 1,010 shares (825)
-----------
Total stockholders' equity 1,873,193
-----------
Total Liabilities and Stockholders' Equity $ 2,538,468
===========
See accompanying notes to these consolidated financial statements.
2
<PAGE>
<TABLE>
<CAPTION>
BISHOP CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
For the Three Months For the Nine Months
Ended December 31, Ended December 31,
---------------------- ----------------------
1998 1997 1998 1997
---- ---- ---- ----
REVENUES -
<S> <C> <C> <C> <C>
Sales of real estate $ 36,939 $ 154,220 $ 536,505 $ 957,746
COSTS AND EXPENSES:
Cost of real estate sold 24,552 78,674 310,805 454,739
General and administrative 124,981 134,877 348,673 378,156
Depreciation and amortization 6,325 6,766 19,082 19,644
--------- --------- --------- ---------
155,858 220,317 678,560 852,539
--------- --------- --------- ---------
INCOME (LOSS) FROM OPERATIONS (118,919) (66,097) (142,055) 105,207
OTHER INCOME (EXPENSE):
Net gas royalties 16,158 26,885 57,468 44,884
Interest income 3,686 6,403 13,094 18,740
Dividend income 3,083 2,709 8,566 8,129
Rental income 7,492 5,236 12,712 12,106
Net gain on sale of marketable securities 930 17,193 8,714 23,712
Net unrealized gain on marketable securities 151,027 6,200 142,008 103,720
Equity in limited partnership income (loss) 1,754 12,079 6,399 (8,119)
Interest expense (5,581) (2,555) (13,296) (10,984)
--------- --------- --------- ---------
INCOME BEFORE INCOME TAXES 59,630 8,053 93,610 297,395
PROVISION FOR INCOME TAXES (22,000) (1,000) (33,000) (60,500)
--------- --------- --------- ---------
NET INCOME $ 37,630 $ 7,053 $ 60,610 $ 236,895
========= ========= ========= =========
EARNINGS PER SHARE $ .04 $ .01 $ .07 $ .28
========= ========= ========= =========
WEIGHTED AVERAGE NUMBER OF
SHARES OUTSTANDING 850,840 791,402 842,484 839,621
========= ========= ========= =========
See accompanying notes to these consolidated financial statements.
3
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
BISHOP CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
December 31,
-----------------------
1998 1997
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C>
Net income $ 60,610 $ 236,895
Adjustments to reconcile net income to net cash
provided by (used in) operating activities:
Depreciation and amortization 29,091 29,652
Equity in limited partnership (income) loss (6,399) 8,119
Net gain on sale of marketable securities (8,714) (23,712)
Net unrealized gain on marketable securities (142,008) (103,720)
Stock bonus compensation 4,000 --
Deferred income taxes 33,000 --
Changes in operating assets and liabilities:
(Increase) decrease in:
Restricted cash (34,695) (100,000)
Marketable securities (93,234) (44,614)
Gas royalties receivable (8,307) (3,213)
Interest and other receivables 41,762 2,532
Prepaid expenses and other 2,410 610
Land under development (72,477) (73,696)
Notes receivable (15,000) --
Increase (decrease) in:
Accounts payable and accrued expenses (46,815) 54,551
Income taxes payable -- 35,500
Payable to broker 55,910 59,929
Deferred revenue 57,521 110,807
--------- ---------
Net cash provided by (used in) operating activities (143,345) 189,640
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from collection of notes receivable 2,987 1,046
Purchase of property and equipment (16,212) (52,314)
--------- ---------
Net cash used in investing activities (13,225) (51,268)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings 140,000 50,000
Principal payments on borrowings -- (50,000)
Treasury stock acquired (825) (100,677)
--------- ---------
Net cash provided by (used in) financing activities 139,175 (100,677)
--------- ---------
Net increase (decrease) in cash and equivalents (17,395) 37,695
Cash and equivalents, beginning of period 35,516 46,735
--------- ---------
Cash and equivalents, end of period $ 18,121 $ 84,430
========= =========
Supplemental Disclosure of Cash Flow Information:
Cash paid for interest $ 8,439 $ 9,538
========= =========
Cash paid for income taxes $ -- $ 25,000
========= =========
See accompanying notes to these consolidated financial statements.
4
</TABLE>
<PAGE>
BISHOP CAPITAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of Presentation
The consolidated financial statements reflect all adjustments which are, in
the opinion of management, necessary for a fair presentation of financial
position at December 31, 1998 and results of operations for the interim
periods ended December 31, 1998 and 1997. Such adjustments are of a normal
and recurring nature. The interim results presented are not necessarily
indicative of results that can be expected for a full year. The
accompanying consolidated financial statements should be read in
conjunction with the audited financial statements and related notes
appearing in the Company's March 31, 1998 Annual Report on Form 10-KSB
filed with the Securities and Exchange Commission.
Certain previously reported amounts have been reclassified to conform to
the current financial statement presentation.
2. Change in Capital Structure and Spinoff
Prior to June 20, 1997, the Company was a wholly-owned subsidiary of
American Rivers Oil Company (AROC). In November 1996, the Board of
Directors of AROC (the Company's sole stockholder of 4,500,000 common
shares outstanding) agreed to make a pro rata distribution of 885,481
shares of the Company's common stock to AROC's common stockholders
(excluding holders of AROC's Class B common stock) of record on November
18, 1996. The pro rata distribution of shares occurred on June 20, 1997,
and the remaining 3,614,519 shares of the Company's common stock owned by
AROC were canceled. Accordingly, all share and per share amounts in the
accompanying financial statements have been retroactively restated to give
effect to the change in capital structure.
3. Revenue Recognition
Sales of real estate generally are accounted for under the full accrual
method. Under that method, gain is not recognized until the collectibility
of the sales price is reasonably assured and the earnings process is
virtually complete. When a sale does not meet the requirements for income
recognition, gain is deferred until those requirements are met. Sales of
real estate are accounted for under the percentage-of- completion method
when the Company has material obligations under sales contracts to provide
improvements after the property is sold. Under the percentage-of-completion
method, the gain on sale is recognized as the related obligations are
fulfilled.
5
<PAGE>
BISHOP CAPITAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
The development of Phase I (approximately 4.6 acres) consisting of four
commercial pad sites in The Crossings at Palmer Park in Colorado Springs,
Colorado was completed in the fiscal year ended March 31, 1998. Three of
the improved lots were sold and closed in the prior fiscal year. The sale
of the remaining improved lot occurred in June 1998. The Company was
required to furnish a bank letter of credit for $111,600 to the City of
Colorado Springs to provide assurance that the channel lining improvements
related to Phase I would be completed. The improvements were completed and
the letter of credit was released by the City of Colorado Springs. The
Company has no other outstanding letters of credit with the City of
Colorado Springs.
The Company commenced Phase II (approximately 6.1 acres) of its 20 acre
development of The Crossings at Palmer Park. The Phase II development plan
consists of four commercial pad sites and the Company sold one of the lots.
The Company entered into a contract for approximately $374,000 of Phase II
site development work consisting of grading, utilities, channel lining,
storm sewer and paving. The Phase II lot sale closed in June 1998 and
$200,000 of the net proceeds of $268,802 were escrowed for the on-site
development work. The balance of the escrow of $89,005 at December 31, 1998
is reflected as restricted cash on the balance sheet.
In connection with the real estate sales, the Company used the
percentage-of-completion method to determine the amount of gross profit to
be recognized for the three and nine months ended December 31, 1998 and
1997 as follows:
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
December 31, December 31,
------------------------- ---------------------------
1998 1997 1998 1997
---- ---- ---- ----
<S> <C> <C> <C> <C>
Sales of real estate $ 20,000 $ -- $ 594,026 $ 1,068,553
Revenue previously deferred 16,939 154,220 -- --
Deferred revenue -- -- (57,521) (110,807)
----------- ----------- ----------- -----------
36,939 154,220 536,505 957,746
Cost of real estate sold 24,552 78,674 310,805 454,739
----------- ----------- ----------- -----------
Gross profit on sale of real estate $ 12,387 $ 75,546 $ 225,700 $ 503,007
=========== =========== =========== ===========
</TABLE>
The deferred revenue of $57,521 is reflected as a liability in the
Company's balance sheet at December 31, 1998 and will be recognized as the
related site development work obligations are completed.
6
<PAGE>
BISHOP CAPITAL CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
4. Long-term Debt
In December 1998, the Company entered into a $250,000 line of credit with a
bank which bears interest at 8.25% and is collateralized by the Company's
office building. The line of credit matures in December 2003 and the
Company is obligated to make monthly payments of $2,427 commencing in
January 1999 with the remaining principal plus interest due upon maturity.
At December 31, 1998, the Company had outstanding borrowings of $140,000
under the line of credit.
5. Gas Royalty Income
Gas royalty income is net of amortization of $3,336 for the three months
ended December 31, 1998 and 1997 and $10,008 for the nine months ended
December 31, 1998 and 1997.
On December 28, 1998, the Company and twenty other royalty owners
("Plaintiffs") filed suit against Burlington Resources Oil & Gas Company
("Burlington') in the District Court, Ninth Judicial District, Fremont
County, Wyoming seeking an accounting of the production, sales of all
production and all expenses associated with royalty payments received from
the Madden Deep Unit gas processing plant. The Plaintiffs allege that
Burlington, operator of the gas processing plant, has and continues to
wrongfully deduct post-production costs, which could include indirect plant
operating costs, from their royalty payments. The Plaintiffs believe that
the royalty payments should be free of any post-production costs or, if
post-production costs are statutorily permitted, then those costs must be
limited only to those reasonable costs directly associated with the
processing of the gas. The Plaintiffs are seeking attorneys' fees and costs
necessitated in obtaining the data they are seeking and payment of amounts
that were improperly deducted for the plant operation. A trial date has not
been set by the Court. No prediction can be given as to when or how these
matters will ultimately be concluded. No assurance can be made that the
Company will ultimately receive any funds from this litigation and,
accordingly, no amounts have been accrued in the accompanying financial
statements.
6. Income Taxes
The provision for income taxes is based on management's estimate of the
effective tax rate expected to be applicable for the fiscal year, net of
the utilization of net operating loss carryforward which is subject to
limitations under IRS Section 382. The tax rate may be revised at the end
of each successive interim period during the fiscal year to reflect
management's current estimate of the annual effective tax rate.
7
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with the
Company's unaudited consolidated financial statements and notes thereto. The
interim results of operations are not necessarily indicative of results to be
expected in future periods.
Forward-Looking Statements
The Company believes that this report contains forward-looking statements, as
defined in the Private Securities Litigation Reform Act of 1995, including,
without limitation, statements containing the words "believes," "anticipates,"
"estimates," "expects," "may," and words of similar import, or statements of
management's opinion. Such forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to be materially different from any
future results, performance or achievements expressed or implied by such
forward-looking statements.
Results of Operations
The Company's results of operations are dependent primarily on the sale of real
estate which is affected by national and local economic and competitive
conditions, including interest rates, construction costs, governmental
regulations and legislation, availability of financing and other factors. In
addition, the Company competes with other owners and developers with greater
resources and experience.
Three Months Ended December 31, 1998 and 1997
The Company's net income for the three months ended December 31, 1998 was
$37,600 compared to net income of $7,100 for the comparable period in 1997. The
1998 increase in net income is primarily attributable to the net unrealized gain
on marketable securities of $151,000 compared to $6,200 in 1997.
For the three months ended December 31, 1998, the Company realized gross profit
on real estate sold of $12,400 which resulted from the sale of one lot in its
Wyoming residential subdivision and recognition of additional gain from the sale
of a Phase II lot in its Colorado Springs, Colorado commercial development as
the related site development work obligations were completed (see Note 3).
During the comparable period in 1997, the Company realized gross profit on real
estate sold of $75,500 which resulted from the recognition of additional gain
from the sale of three Phase I lots as the related site development work
obligations were completed.
General and administrative expenses decreased $9,900 or 7% for the three months
ended December 31, 1998 compared to the same period in 1997 and is attributable
to a general reduction in operational costs and expenses.
8
<PAGE>
Net gas royalty income decreased $10,700 or 40% in the current quarter compared
to the corresponding quarter in 1997. Natural gas production for the three
months ended December 31, 1998 was 16,036 mcf compared to 14,795 mcf for the
comparable period in 1997. The average sales price of natural gas decreased 35%
($1.49 per mcf compared to $2.29 per mcf). Severance taxes and gas processing
costs remained comparable between the interim periods.
Interest and dividend income decreased $2,300 or 26% for the three months ended
December 31, 1998 compared to the same period in 1997 due primarily to a
decrease in cash balances available for investment purposes.
The net unrealized gain on marketable securities of $151,000 for the three
months ended December 31, 1998 represents the net change from September 30, 1998
in the market value of the trading securities portfolio.
Equity in limited partnership income of $1,800 for the three months ended
December 31, 1998 represents the Company's share of the net rental income from
the ground lease. In October 1997, all improvements related to the partnership
operations were sold to an unrelated third-party and the purchaser entered into
a 25 year ground lease on the real property. The equity in partnership income of
$12,100 for the three months ended December 31, 1997 resulted from the net
rental income from the ground lease and other miscellaneous income.
Interest expense increased $3,000 for the three months ended December 31, 1998
compared to the comparable quarter in 1997 due to bank borrowings under the line
of credit discussed in Note 4.
Nine Months Ended December 31, 1998 and 1997
The Company's net income for the nine months ended December 31, 1998 was $60,600
compared to $236,900 for the comparable period in 1997. The decrease in net
income for the nine months ended December 31, 1998 compared to 1997 is primarily
attributable to a lower volume of sales of real estate. During the current
period, the Company realized gross profit on real estate sold of $225,700 which
resulted from the sale of one lot in Phase I of its Colorado Springs, Colorado
commercial development which was completed in the prior fiscal year and one lot
in Phase II currently under development (see Note 3). In addition, the Company
sold one lot in its Wyoming residential subdivision. During the comparable
period in 1997, the Company realized gross profit on real estate sold of
$503,000 which resulted from three lot sales in Phase I and one lot sale in its
Wyoming residential subdivision.
General and administrative expenses decreased $29,500 or 8% for the nine months
ended December 31, 1998 compared to the same period in 1997. The decrease is due
to non-recurring expenses associated with the June 1997 spin-off from American
Rivers Oil Company.
9
<PAGE>
Net gas royalties increased $12,600 or 28% in the current nine months compared
to the corresponding nine months in 1997. Natural gas production for the nine
months ended December 31, 1998 was 46,582 mcf compared to 38,950 mcf for the
comparable period in 1997. The average sales price of natural gas decreased 6%
($1.68 per mcf compared to $1.79 per mcf). Severance taxes and gas processing
costs decreased $5,100 or 31% for the nine months ended December 31, 1998
compared to the same period in 1997.
Interest and dividend income decreased $5,200 or 19% for the nine months ended
December 31, 1998 compared to the same period in 1997 due primarily to a
decrease in cash balances available for investment purposes.
Net unrealized gain on marketable securities of $142,000 for the nine months
ended December 31, 1998 represents the net change from March 31, 1998 in the
market value of the trading securities portfolio.
Equity in limited partnership income of $6,400 for the nine months ended
December 31, 1998 represents the Company's share of the net rental income from a
ground lease. In October 1997, all improvements related to the partnership
operations were sold to an unrelated third-party and the purchaser entered into
a 25 year ground lease on the real property. The equity in partnership loss of
$8,100 for the nine months ended December 31, 1997 resulted from certain
expenses being incurred without any offsetting revenue from operations due to
the purchaser of the improvements assuming management of the day-to-day
operations in July 1997.
Interest expense increased $2,300 or 21% for the nine months ended December 31,
1998 compared to the comparable period in 1997 due to bank borrowings under the
line of credit discussed in Note 4.
Financial Condition
At December 31, 1998, the Company had working capital of $480,400.
The following summary table reflects comparative cash flows for the Company as
follows:
Nine Months Ended
December 31,
-----------------------
1998 1997
---- ----
Net cash provided by (used in):
Operating activities $(143,300) $ 189,600
Investing activities (13,200) (51,300)
Financing activities 139,200 (100,700)
Net cash used in operating activities of $143,300 for the nine months ended
December 31, 1998 resulted from a lower volume of real estate sales compared to
10
<PAGE>
1997. Net cash provided by operating activities of $189,600 for the comparable
period in 1997 resulted primarily from real estate sales.
Net cash used in investing activities of $13,200 and $51,300 for the nine months
ended December 31, 1998 and 1997, respectively, resulted primarily from the
purchase of property and equipment.
Net cash provided by financing activities of $139,200 for the nine months ended
December 31, 1998 resulted from bank borrowings of $140,000 offset by the
acquisition of 1,010 shares of treasury stock for $825. Net cash used in
financing activities of $100,700 for the nine months ended December 31, 1997
resulted from the Company acquiring 94,116 shares of treasury stock. The Company
also had bank borrowings of $50,000 and repayment of bank borrowings of $50,000
for the 1997 period.
The Company's material commitments for capital expenditures in the next twelve
months will be in conjunction with the Phase III development of The Crossings at
Palmer Park and a proposed 350 unit apartment complex in Colorado Springs,
Colorado.
The Company will have to complete additional drainage channel improvements when
a Phase III plat is submitted to the City of Colorado Springs for approval. The
Company will also incur on-site development costs for utilities, storm sewer and
paving. The estimated costs of $250,000 for these improvements will be funded
from the proceeds of any Phase III lot sales.
In October 1998, the Company entered into a limited partnership agreement with
an unrelated third party to develop and construct a 350 unit apartment complex
(the "Project"). The Project is subject to the successful rezoning of
approximately 18 acres of undeveloped real property owned by the Company in
Colorado Springs, Colorado and favorable Project financing. The rezoning process
is expected to be completed by April 1999. The estimated cost for the Project is
$20,000,000 of which $18,000,000 is anticipated to be financed by a non-recourse
loan from the U. S. Department of Housing and Urban Development or any other
third party lender. The Company, upon successful rezoning, will contribute the
land valued at $1,600,000 for an 80% limited partner interest. The unrelated
third party will contribute $400,000 of services for the remaining 20% limited
partner interest and will also be the general partner. In addition, the limited
partners may be required to loan the partnership up to $100,000 each. Subsequent
to December 31, 1998, the Company and the other limited partner each loaned
$10,000 to the partnership for costs associated with the rezoning process.
The Company believes that existing working capital, together with current
sources of available financing, will be sufficient to fund the Company's
operations during the next twelve months.
11
<PAGE>
Year 2000 Issue
The Year 2000 issue is the result of computer programs using two digits rather
than four to define the applicable year. Computer programs that have
date-sensitive software may recognize a date using "00" as the year 1900 rather
than the year 2000. This could result in system failures or miscalculations
leading to disruptions in a company's operations.
The Company is continuing the review of its computer system to assess the
potential costs and scope of the Year 2000 issue. The Company utilizes a minimal
number of computer programs (primarily accounts payable, general ledger and
payroll) in its operations. The Company is utilizing both internal and external
resources to replace its current software for Year 2000 compliant software. The
Company's goal is to complete all relevant internal software remediation and
testing by September 30, 1999. The total cost to the Company of these Year 2000
issue activities has not been and is not anticipated to be material to its
financial position or results of operations. Any hardware and/or software
purchased will be capitalized in accordance with normal policy. Personnel and
all other costs related to the project are being expensed as incurred.
The Company has initiated communications with external entities to determine the
status of their own Year 2000 issues that may affect the Company's operations.
There can be no guarantee that the systems of these external entities will be
timely converted and would not have an adverse effect on the Company's
operations.
The Company is developing a contingency plan for the various Year 2000 issues
and will continue to revise the plan based on testing results and third-party
communications.
12
<PAGE>
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
None
Item 3. Default 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
27 Financial Data Schedule (submitted only in electronic format)
b. Reports on Form 8-K
None
13
<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.
BISHOP CAPITAL CORPORATION
(Registrant)
Date: February 10, 1999 By: /s/ Robert E. Thrailkill
------------------------------
Robert E. Thrailkill
President
(Principal Executive Officer)
Date: February 10, 1999 By: /s/ John A. Alsko
------------------------------
John A. Alsko
Treasurer and Chief Financial
Officer
(Principal Financial Officer)
14
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> MAR-31-1999
<PERIOD-END> DEC-31-1998
<CASH> 18,121
<SECURITIES> 879,750
<RECEIVABLES> 31,013
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,023,392
<PP&E> 382,911
<DEPRECIATION> 163,297
<TOTAL-ASSETS> 2,538,468
<CURRENT-LIABILITIES> 543,033
<BONDS> 0
0
0
<COMMON> 8,784
<OTHER-SE> 1,864,409
<TOTAL-LIABILITY-AND-EQUITY> 2,538,468
<SALES> 536,505
<TOTAL-REVENUES> 536,505
<CGS> 310,805
<TOTAL-COSTS> 678,560
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 13,296
<INCOME-PRETAX> 93,610
<INCOME-TAX> 33,000
<INCOME-CONTINUING> 60,610
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 60,610
<EPS-PRIMARY> .07
<EPS-DILUTED> .07
</TABLE>
