<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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 quarterly period ended March 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from _________ to __________
Commission File Number: 0-22145
RWD TECHNOLOGIES, INC.
(Exact name of Registrant as specified in its Charter)
Maryland 52-1552720
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
10480 Little Patuxent Parkway 21044-3530
Columbia, Maryland (Zip Code)
(Address of principal executive offices)
(410) 730-4377
(Registrant's telephone number, including area code)
None
(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 __
--
As of March 31, 2000, 14,816,962 shares of common stock $0.10 par value ("Common
Stock") of the Registrant were outstanding.
<PAGE>
RWD TECHNOLOGIES, INC.
INDEX
FORM 10-Q
<TABLE>
<CAPTION>
Page
----
<S> <C>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Condensed Balance Sheets as of March 31, 2000, 1
(Unaudited) and December 31, 1999
Consolidated Statements of Income for the Three Months ended 2
March 31, 2000, and 1999 (Unaudited)
Consolidated Statements of Cash Flows for the Three Months 3
ended March 31, 2000, and 1999 (Unaudited)
Notes to Consolidated Financial Statements 4
Item 2. Management's Discussion and Analysis of Financial Condition 6
and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk N/A
PART II - OTHER INFORMATION
Item 1. Legal Proceedings N/A
Item 2. Changes in Securities 10
Item 3. Defaults Upon Senior Securities N/A
Item 4. Submission of Matters to a Vote of Security Holders N/A
Item 5. Other Information N/A
Item 6. Exhibits and Reports on Form 8-K 10
Signatures 11
</TABLE>
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
RWD TECHNOLOGIES, INC., AND SUBSIDIARIES
Consolidated Condensed Balance Sheets
(In thousands)
<TABLE>
<CAPTION>
March 31, 2000 December 31, 1999
-------------- -----------------
(unaudited)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and investments..................... $26,184 $28,214
Contract accounts receivable, net........ 17,799 21,731
Costs and estimated earnings in excess
of billings on uncompleted contracts... 11,949 7,232
Prepaid expenses and other............... 1,861 1,257
Deferred tax asset....................... -- 19
Income tax refund receivable............. 1,885 1,692
-------------- -----------------
Total Current Assets................... 59,678 60,145
NET FIXED ASSETS........................... 12,093 11,464
GOODWILL, net.............................. 13,796 13,421
OTHER ASSETS............................... 3,091 2,231
-------------- -----------------
Total Assets........................... $88,658 $87,261
============== =================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable and accrued expenses.... $ 9,686 $ 8,024
Note payable............................. -- 1,026
Billings in excess of costs and estimated
earnings on uncompleted contracts...... 3,319 4,005
Deferred tax liability................... 264 --
Current portion of capital lease
obligation............................. 26 25
-------------- -----------------
Total Current Liabilities.............. 13,295 13,080
NONCURRENT LIABILITIES:
Capital lease obligation, net of
current portion........................ 19 26
Other liabilities........................ 532 592
Deferred tax liability................... 303 222
-------------- -----------------
Total Liabilities...................... 14,149 13,920
-------------- -----------------
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock............................. 1,482 1,470
Additional paid-in capital............... 47,782 47,210
Accumulated comprehensive income......... (1) (45)
Retained earnings........................ 25,246 24,706
-------------- -----------------
Total Stockholders' Equity............. 74,509 73,341
-------------- -----------------
Total Liabilities and
Stockholders' Equity................. $88,658 $87,261
============== =================
</TABLE>
See accompanying notes to consolidated financial statements.
1
<PAGE>
RWD TECHNOLOGIES, INC., AND SUBSIDIARIES
Consolidated Statements of Income
(Unaudited) (In thousands, except per share data)
<TABLE>
<CAPTION>
Three Months Ended March 31,
----------------------------
<S> <C> <C>
2000 1999
--------- ---------
Revenue................................... $30,814 $33,242
Cost of services.......................... 24,059 22,388
--------- ---------
Gross profit............................ 6,755 10,854
Selling, general and administrative
expenses................................. 5,987 5,228
--------- ---------
Operating income.......................... 768 5,626
Other income, net......................... 88 460
--------- ---------
Income before taxes..................... 856 6,086
Income tax provision...................... 317 2,282
--------- ---------
Net income.............................. $ 539 $ 3,804
========= =========
Diluted earnings per share.............. $.04 $.24
========= =========
Basic earnings per share................ $.04 $.25
========= =========
Weighted average shares outstanding -
Diluted calculation.................... 15,404 15,920
========= =========
Basic calculation...................... 14,757 15,032
========= =========
</TABLE>
See accompanying notes to consolidated financial statements.
2
<PAGE>
RWD TECHNOLOGIES, INC., AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Unaudited) (In thousands)
<TABLE>
<CAPTION>
Three Months Ended March 31,
2000 1999
---------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income......................................... $ 539 $ 3,804
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization.................... 1,388 967
Loss (gain) on disposal of fixed assets.......... 2 (1)
Deferred income taxes............................ -- (300)
Effect of changes in:
Contract accounts receivable..................... 4,079 (1,862)
Costs and earnings in excess of billings on
uncompleted contracts.......................... (4,717) (2,647)
Prepaid expenses and other....................... (649) (230)
Accounts payable and accrued expenses............ 1,966 1,611
Billings in excess of costs and earnings on
uncompleted contracts.......................... (697) (237)
Other liabilities................................ (60) (242)
---------- -----------
Net cash from operating activities................. 1,851 863
---------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of investments, net....................... (318) (351)
Payments related to acquisition.................... (1,252) --
Purchase of fixed assets........................... (2,218) (1,740)
Payments for other assets.......................... (737) (59)
Proceeds from sale of fixed assets................. -- 8
---------- -----------
Net cash from investing activities................. (4,525) (2,142)
---------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal portion paid on capital lease............ -- (15)
Borrowings under line of credit.................... 742 --
Payments under line of credit...................... (742) --
Issuance of common stock........................... 282 252
Repurchase of common stock......................... -- (2,168)
---------- -----------
Net cash from financing activities................. 282 (1,931)
---------- -----------
NET DECREASE IN CASH AND CASH
EQUIVALENTS........................................ (2,392) (3,210)
Effect of exchange rate changes on cash.............. 21 --
CASH AND CASH EQUIVALENTS, beginning of period....... 3,760 13,328
---------- -----------
CASH AND CASH EQUIVALENTS, end of period............. $ 1,389 $ 10,118
========== ===========
Supplemental Cash Flow Disclosures:
Income taxes paid.................................. $ 216 $ 1,613
========== ===========
Interest expense paid.............................. $ 1 $ 2
========== ===========
</TABLE>
See accompanying notes to consolidated financial statements.
3
<PAGE>
RWD TECHNOLOGIES, INC., AND SUBSIDIARIES
Notes to Consolidated Financial Statements
(Unaudited)
1. Summary of Significant Accounting Policies:
Organization and Business
- -------------------------
RWD Technologies, Inc., and subsidiaries (the "Company") was incorporated on
January 22, 1988, in the State of Maryland. The Company provides a broad range
of integrated solutions designed to improve the productivity and effectiveness
of workers in complex operating environments.
The Company's operations depend upon, among other things, the Company's
ability to attract, develop, and retain a sufficient number of highly skilled
professional employees. In addition, the Company's revenue is generated from a
limited number of clients in specific industries. Future operations may be
affected by its ability to retain these clients and cyclical and economic
factors that could have an impact on those industries.
Basis of Presentation
- ---------------------
The accompanying unaudited consolidated condensed financial statements have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q.
Accordingly, they 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, consisting of normal recurring
adjustments considered necessary for a fair presentation, have been included.
These financial statements should be read in conjunction with the audited
consolidated financial statements of the Company for the fiscal year ended
December 31, 1999, included in the Company's Annual Report on From 10-K.
In the first quarter of 2000 the Company changed the way it reports gross
profit margins. The Company previously included selling expenses with cost of
sales and has now included these expenses with selling, general and
administrative expenses. Historical bottom line results obviously do not
change, however, prior quarter comparisons are restated to reflect consistently
this change. The amounts for the first quarter of 1999 were reclassified to
conform to the 2000 period presentation.
Comprehensive Income
- --------------------
Comprehensive income is defined as the change in equity of a business
enterprise during a period from transactions and other events and circumstances
from nonowner sources. The Company's comprehensive income for the periods
presented is listed below:
<TABLE>
<CAPTION>
For the Three Months
Ended March 31,
------------------------
2000 1999
------- -------
<S> <C> <C>
Net Income as Reported $ 539 $3,804
Effect of Unrealized Gain (Loss) on
Investments Available-for-Sale 23 (23)
Effect of Unrealized Gain on
Foreign Exchange 21 --
------- -------
Comprehensive Net Income $ 583 $3,781
======= =======
</TABLE>
4
<PAGE>
2. Business Segments:
The Company believes it has reportable operating segments, as defined by
Statement of Financial Accounting Standards No. 131. The Company has identified
three distinct operating segments: Latitude360; Enterprise Systems Group; and
Manufacturing Performance Group.
During the three months ended March 31, 2000, the Company changed its
reportable segments from Information Technology, Enterprise Resource Planning,
Lean Manufacturing Consulting, and Technology Performance Support; to
Latitude360, Enterprise Systems Group, and Manufacturing Performance Group. The
change was made to conform the Company's reporting to how it now manages its
business. As a result, the Company has restated the results of the three months
ended March 31, 1999 segment reporting disclosure to conform to its new
segments.
The accounting policies for these segments are the same as those described in
the summary of significant accounting policies. Depreciation and amortization
expense is reported in each operating segment. However, the Company's tangible
assets are not managed as distinct asset groups. All tangible assets are
recorded at the corporate level with depreciation expense allocated to operating
segments based on headcount. Interest expense, interest income, and income taxes
are reported at the corporate level only and are not disclosed below.
<TABLE>
<CAPTION>
For the Three Months
Ended March 31,
--------------------------
(in thousands)
2000 1999
---------- ---------
<S> <C> <C>
Revenue (all external):
Latitude360 $ 9,053 $10,182
Enterprise Systems Group 10,792 12,108
Manufacturing Performance Group 10,969 10,952
---------- ---------
Total Revenue $30,814 $33,242
========== =========
Gross Profit:
Latitude360 $ 939 $ 3,492
Enterprise Systems Group 2,902 3,904
Manufacturing Performance Group 2,914 3,458
---------- ---------
Total Gross Profit $ 6,755 $10,854
========== =========
Depreciation and Amortization Expense
Allocated To Segments:
Latitude360 $ 445 $ 252
Enterprise Systems Group 339 287
Manufacturing Performance Group 197 186
---------- ---------
Total Allocated to Segments 981 725
Amount not Allocated to Segments 407 242
---------- ---------
Total Depreciation and Amortization Expense $ 1,388 $ 967
========== =========
Revenue (by geography):
United States $27,256 $30,019
Non-United States 3,558 3,223
---------- ---------
Total Revenue $30,814 $33,242
========== =========
</TABLE>
5
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Results of Operations
Quarter Ended March 31, 2000, Compared to Quarter Ended March 31, 1999
Revenue. First quarter 2000 revenues were $30.8 million, compared to $33.2
million for the same period of 1999. For the three months ended March 31, 2000,
net income was $539,500, or $0.04 per share. This compares to net income of $3.8
million, or $0.24 per share, in the same period of 1999. Revenue for individual
operating segments were as follows:
. Latitude360. Revenue for Latitude360, the Company's Internet Technology and
e-Learning Services Group, decreased by $1.1 million (or 11.1 percent), from
$10.2 million in the quarter ending March 31, 1999, to $9.1 million in the
quarter ending March 31, 2000, representing 30.6 percent of the Company's
revenue in 1999 and 29.4 percent of the Company's revenue in 2000. Key
factors in revenue decreases resulted primarily from reductions in demand of
the Company's IT services as compared to the first quarter of 1999. The
Company is in the process of a major reorganization, as a result of
diminished demand after the first quarter of 1999, shifting its emphasis to
web related and e-Learning IT services.
. Enterprise Systems Group. Revenue for the Enterprise Systems Group decreased
by $1.3 million (or 10.9 percent), from $12.1 million in the quarter ending
March 31, 1999, to $10.8 million in the quarter ending March 31, 2000,
representing 36.4 percent of the Company's revenue in 1999 and 35.0 percent
of the Company's revenue in 2000. The decrease in the Company's ERP revenue
from 1999 to 2000 was attributable to the overall slowdown in the market for
ERP software systems, generally recognized as due to the effects in 1999 of
client focus on remediation of the year 2000 computer problem, and the
resulting decrease in demand for the Company's ERP services.
. Manufacturing Performance Group. Revenue for the Manufacturing Performance
Group increased by $17,400 (or 0.2 percent), from $10.95 million in the
quarter ending March 31, 1999, to $10.97 million in the quarter ending March
31, 2000, representing 32.9 percent of the Company's revenue in 1999 and 35.6
percent of the Company's revenue in 2000. This marginal increase in revenue
was the result of the normal completion of a proportion of the Company's on-
going projects and their replacement with follow-on work at somewhat lower
levels of revenue.
Gross Profit. Gross profit for the total Company decreased by $4.1 million
(or 37.8 percent), from $10.9 million in the quarter ending March 31, 1999, to
$6.8 million in the quarter ending March 31, 2000, and decreased from 32.7
percent of revenue in 1999 to 21.9 percent of revenue in 2000. This decrease in
gross profit as a percentage of revenue resulted primarily from decreases in
staff utilization in the Company's Enterprise Resource Planning Services and
Information Technology businesses, and increases in employee-related expenses
and marketing expenses.
In the first quarter of 2000 the Company changed the way it reports gross
profit margins. Historically, the Company included selling expenses with cost
of sales, creating an inconsistent comparison between RWD and comparable
companies. Effective January 1, 2000, selling expenses are no longer included
with cost of sales and are included in the SG&A line. Historical bottom line
results obviously do not change, however, prior quarter comparisons are restated
to reflect consistently this change. The amounts for the first quarter of 1999
were reclassified to conform to the 2000 period presentation.
6
<PAGE>
Gross profit for individual operating segments were as follows:
. Latitude360. Gross profit for Latitude360 decreased by 73.1 percent from $3.5
million in the quarter ending March 31, 1999, to $939,400 in the quarter
ending March 31, 2000. Gross profit margin for Latitude360 decreased from
34.3 percent of this segment's revenue in the first quarter of 1999 to 10.4
percent in 2000. This decrease in gross profit margin resulted primarily from
decreased staff utilization and investments in the Company's capabilities in
e-commerce and e-learning, as well as increased marketing expenditures.
. Enterprise Systems Group. Gross profit for the Enterprise Systems Group
decreased by 25.7 percent from $3.9 million in the quarter ending March 31,
1999, to $2.9 million in the quarter ending March 31, 2000. Gross profit
margin for the Enterprise Systems Group decreased from 32.2 percent of this
segment's revenue in the first quarter of 1999 to 26.9 percent in 2000. This
decrease in gross profit margin resulted primarily from decreased staff
utilization, as well as increased marketing and an increase in the
reimbursable travel costs associated with a significant European-based
project.
. Manufacturing Performance Group. Gross profit for the Manufacturing
Performance Group decreased by 15.7 percent from $3.5 million in the quarter
ending March 31, 1999, to $2.9 million in the quarter ending March 31, 2000.
Gross profit margin for the Manufacturing Performance Group decreased from
31.6 percent of this segment's revenue in the first quarter of 1999 to 26.6
percent in 2000. This decrease in gross profit margin resulted primarily from
decreased staff utilization.
Selling, General and Administrative Expenses. Selling, general and
administrative expenses increased by $759,000 (or 14.5 percent), from $5.2
million in the first quarter of 1999 to $6.0 million in the first quarter of
2000, increasing from 15.7 percent of revenue in 1999 to 19.4 percent of revenue
in 2000. This increase in general and administrative expenses as a percentage of
revenue resulted primarily from growth in corporate personnel and increases in
employee-related expenses, as well as the lower revenue run-rate in the first
quarter of 2000.
Operating Income. As a result of the foregoing, the Company's operating income
decreased by $4.9 million from $5.6 million in the first quarter of 1999 to
$768,100 in the first quarter of 2000 and decreased from 16.9 percent of revenue
in the first quarter of 1999 to 2.5 percent of revenue in the first quarter of
2000.
Other Income. Other income was $460,600 in the first quarter of 1999 and
$88,200 in the first quarter of 2000. The decrease in the dollar amount of other
income resulted primarily from reduced interest income due to the use of cash
for the Company's acquisition and share repurchases, as well as goodwill
recognized in the first quarter of 2000 for the Merrimac acquisition.
Net Income. Net income decreased by $3.3 million (or 85.8 percent), from $3.8
million in the first quarter of 1999 to $539,500 in the first quarter of 2000,
decreasing from 11.4 percent of revenue in 1999 to 1.8 percent of revenue in
2000.
7
<PAGE>
Liquidity and Capital Resources
The Company's cash and investments were $26.2 million at March 31, 2000,
compared to $28.2 million at December 31, 1999. Decreases in cash and
investments at March 31, 2000, were attributable primarily to the increase in
the Company's days sales outstanding in the first quarter of 2000 as a result of
accounting support staff's diversion for its internal implementation of the SAP
system. This trend of increased days sales outstanding is expected to be abated
once the system is implemented on May 1, 2000. The Company's working capital
was $46.4 million at March 31, 2000, and $47.1 million at December 31, 1999.
The Company's operating activities provided cash of approximately $1.9 million
for the three months ended March 31, 2000, compared to $864,300 for the same
period in 1999. The cash provided from operations in the first three months of
2000 resulted primarily from decreases in trade accounts receivable and
increases in accounts payable partially offset by increases in unbilled revenue.
Investing activities used cash of $4.5 million in the three months ended March
31, 2000, compared to $2.1 million for the same period in 1999. Cash used for
investing activities in the three months ended March 31, 2000, consisted
primarily of the final payment on a note payable as a result of the purchase of
Merrimac Interactive Media Corporation and the purchase of capital equipment.
Financing activities provided cash of $282,200 in the three months ended March
31, 2000, compared to the use of $1.9 million for the same period in 1999. Cash
provided by financing activities in the three months ended March 31, 2000,
consisted of the issuance of the Company's common stock through the exercise of
employee stock options in the first quarter of 2000. Cash used by financing
activities in the three months ended March 31, 1999 consisted primarily of the
repurchase of the Company's stock by the Company, partially offset by the
issuance of the Company's common stock through the exercise of employee stock
options.
The Company has a $10.0 million unsecured revolving line of credit with a
commercial bank, which bears interest at the 30-day, LIBOR rate (6.1 percent on
March 31, 2000), plus 0.875 percent. The Company utilizes this line of credit to
finance a portion of its working capital needs. There was no balance outstanding
on the line of credit as of March 31, 2000 or December 31, 1999.
During the three months ending March 31, 2000, the Company made $1.9 million
in capital expenditures, primarily for office furniture, computer and office
equipment, and leasehold improvements to support the growth in its professional
and administrative staff. Capital expenditures currently are funded from
available cash, although the Company may consider alternative financing methods,
such as equipment leases or asset-based borrowings in future periods.
8
<PAGE>
Effects of Inflation
Inflation has not had a significant effect on the Company's business during
the past three years. The Company cannot predict what effect, if any, inflation
may have on its future results of operations.
Forward Looking Statements
Certain statements contained herein, including statements regarding
development of the Company's services, markets, and future demands for the
Company's services, and other statements regarding matters that are not
historical facts, are forward-looking statements (as defined in the Private
Securities Litigation Reform Act of 1995). Such forward-looking statements
include risks and uncertainties; consequently, actual results may differ from
those expressed or implied thereby. Factors that could cause actual results to
differ materially are described in the Company's filings with the Securities and
Exchange Commission including its most recent Form 10-K, and include reliance on
strategic alliances, geographic expansion, slower growth in the Enterprise
Resource Planning industry, rapid change in the Information Technology sector,
customer and industry revenue concentration, attracting and retaining personnel,
increasing competition, and other factors such as the Company's ability to
effectively manage its growth, the inherent variability of its operating
results, various risks associated with the success and profitability of
individual projects, and its dependence on key personnel.
9
<PAGE>
PART II - OTHER INFORMATION
Item 2. Changes in Securities.
(c) Issuance of Securities
N/A
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
27. Financial Data Schedule
(b) Current Reports on Form 8-K
1. Dated March 1, 2000; Filed March 15, 2000
Re: Appointment of Outside Director
10
<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.
RWD TECHNOLOGIES, INC.
By: /s/ William M. Bambarger, Jr.
-----------------------------
William M. Bambarger, Jr, CPA
Vice President, Chief Financial Officer,
and Director
Dated:______________
Pursuant to the requirements of the Securities Exchange Act of 1934, this
Report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>
Name Capacity Date
- ------------------------------- ---------------------------------------------- -------------------------
<S> <C> <C>
/s/ Robert W. Deutsch Chairman of the Board,
- ------------------------------- Chief Executive Officer, and Director
Robert W. Deutsch
/s/ William M. Bambarger, Jr. Vice President, Chief Financial Officer,
- ------------------------------- and Director
William M. Bambarger, Jr.
</TABLE>
11
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> JAN-01-2000
<PERIOD-END> MAR-31-2000
<CASH> 1,389,000
<SECURITIES> 24,795,000
<RECEIVABLES> 18,038,000
<ALLOWANCES> 239,000
<INVENTORY> 0
<CURRENT-ASSETS> 59,678,000
<PP&E> 25,648,000
<DEPRECIATION> 13,555,000
<TOTAL-ASSETS> 88,658,000
<CURRENT-LIABILITIES> 13,295,000
<BONDS> 0
0
0
<COMMON> 1,482,000
<OTHER-SE> 73,027,000
<TOTAL-LIABILITY-AND-EQUITY> 88,658,000
<SALES> 0
<TOTAL-REVENUES> 30,814,000
<CGS> 0
<TOTAL-COSTS> 24,059,000
<OTHER-EXPENSES> 5,987,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 30,000
<INCOME-PRETAX> 856,000
<INCOME-TAX> 317,000
<INCOME-CONTINUING> 539,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 539,000
<EPS-BASIC> .04
<EPS-DILUTED> .04
</TABLE>
