<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarterly Period Ended Commission File Number:
August 31, 1998 0-23021
EDUTREK INTERNATIONAL, INC.
- --------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Georgia 58-2255472
- --------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
500 Embassy Row, 6600 Peachtree Dunwoody Road, Atlanta, Georgia 30328
- --------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
404-965-8000
- --------------------------------------------------------------------------
(Registrant's telephone number, including area code)
3340 Peachtree Road, Suite 2000, Atlanta, Georgia 30326
- --------------------------------------------------------------------------
(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 _____
-----
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date:
<TABLE>
<CAPTION>
<S> <C>
Class A Common Stock, without par value per share 4,351,855 shares
- ------------------------------------------------------ ---------------------------------
Class Outstanding at September 30, 1998
Class B Common Stock, without par value per share 6,293,000 shares
- ------------------------------------------------------ ---------------------------------
Class Outstanding at September 30, 1998
</TABLE>
<PAGE>
EduTrek International, Inc.
Form 10-Q Index
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements 1
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 6
PART II. - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K 10
</TABLE>
<PAGE>
PART I -- FINANCIAL INFORMATION
Item 1. Financial Statements
EDUTREK INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)
<TABLE>
<CAPTION>
August 31, May 31,
1998 1998
----------------- ----------------
(unaudited)
<S> <C> <C>
ASSETS
Current assets
Cash and cash equivalents $ 2,694 $ 5,843
Accounts receivable -- net of allowance of $126 and $190, respectively 6,062 5,402
Deferred income taxes 130 130
Other 606 759
----------------- ----------------
Total current assets 9,492 12,134
Property, plant, and equipment -- net of accumulated depreciation 8,151 5,729
Goodwill -- net of accumulated amortization of $1,956 and $1,704, respectively 38,705 38,957
Other 3,468 1,465
================= ================
$ 59,816 $ 58,285
================= ================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable $ 1,243 $ 2,508
Accrued expenses 682 721
Value-added tax payable 255 157
Unearned revenues 9,412 6,839
Income taxes payable 797 1,616
Current maturities -- long-term debt 799 574
----------------- ----------------
Total current liabilities 13,188 12,415
Long-term debt -- less current maturities 2,315 667
Deferred rent 905 849
Other liabilities 104 60
Commitments and contingencies
SHAREHOLDERS' EQUITY
Common stock, Class A voting, one vote per share, without par value, 40,000,000
shares authorized, 4,340,495 and 4,335,401 issued and outstanding, respectively 36,593 36,564
Common stock, Class B voting, ten votes per share, without par value, 10,000,000
shares authorized, 6,293,000 issued and outstanding 3,973 3,973
Accumulated other comprehensive income 54 88
Retained earnings 2,684 3,669
----------------- ----------------
Total shareholders' equity 43,304 44,294
================= ================
$ 59,816 $ 58,285
================= ================
</TABLE>
See notes to consolidated financial statements.
1
<PAGE>
EduTrek International, Inc.
Consolidated Statements of Operations
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
Three Months Ended August 31,
1998 1997
-------------- ----------------
(unaudited) (unaudited)
<S> <C> <C>
Net revenues $ 7,825 $ 6,228
Costs and expenses:
Cost of education and facilities 4,388 2,974
Selling and promotional expenses 1,819 1,309
General and administrative expenses 2,828 2,242
Amortization of goodwill 252 252
-------------- ----------------
Total costs and expenses 9,287 6,777
-------------- ----------------
Loss from campus operations (1,462) (549)
Income from management agreement - 23
-------------- ----------------
Loss from operations (1,462) (526)
Interest expense (35) (910)
Other income -- net 61 -
-------------- ----------------
Loss before income taxes and minority interest (1,436) (1,436)
Income tax benefit 489 474
-------------- ----------------
Loss before minority interest (947) (962)
Minority interest in earnings of American University in Dubai (38) -
-------------- ----------------
Net loss $ (985) $ (962)
============== ================
Loss Per Share:
Basic net loss per share $ (0.09) $ (0.13)
Average shares outstanding 10,630 7,212
</TABLE>
See notes to consolidated financial statements.
2
<PAGE>
EduTrek International, Inc.
Consolidated Statements of Cash Flows
(In thousands)
<TABLE>
<CAPTION>
Three Months Ended August 31,
1998 1997
-------------------- --------------------
(unaudited) (unaudited)
<S> <C> <C>
OPERATING ACTIVITIES
Net loss $ (985) $ (962)
Adjustments to reconcile net loss to net cash used in
operating activities:
Depreciation and amortization 746 571
Bad debt expense 70 140
Amortization of loan discount - 22
Increase in accounts receivable (730) (1,221)
Decrease in accounts payable and accrued liabilities (1,307) (175)
Increase in unearned revenues 2,573 1,268
Increase (decrease) in value-added taxes payable 98 (304)
Decrease in income taxes payable (819) (645)
Other 39 (798)
------------- -------------
Net cash used in operating activities (315) (2,104)
------------- -------------
INVESTING ACTIVITIES
Additions to pre-opening and curriculum development costs (1,975) -
Purchases of property, plant, and equipment (656) (355)
------------- -------------
Net cash used in investing activities (2,631) (355)
------------- -------------
FINANCING ACTIVITIES
Principal repayments on long-term debt (86) -
Principal payments under capital lease obligations (136) -
Net receipts -- line-of-credit - 1,902
Decrease in deferred loan costs - 66
Other 29 2
------------- -------------
Net cash (used in) provided by financing activities (193) 1,970
------------- -------------
Effect of exchange rate changes on cash (10) (33)
------------- -------------
NET DECREASE IN CASH AND CASH EQUIVALENTS (3,149) (522)
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD 5,843 678
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 2,694 $ 156
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest $ 35 $ 771
Income taxes 330 171
</TABLE>
See notes to consolidated financial statements.
3
<PAGE>
EduTrek International, Inc.
Notes to Consolidated Financial Statements
(Unaudited)
Note 1 - Basis of Presentation
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X. Accordingly, they do not include all of the information and
disclosures required by generally accepted accounting principles for complete
financial statements. These unaudited financial statements include all
adjustments, consisting of only normal, recurring accruals, which EduTrek
International, Inc. (the "Company") considers necessary for a fair presentation
of the financial position and the results of operations for these periods.
The results of operations for the three months ended August 31, 1998 are
not necessarily indicative of the results to be expected for the full year
ending May 31, 1999. For further information, refer to the consolidated
financial statements and notes thereto for the fiscal year ended May 31, 1998
included in the Company's Annual Report on Form 10-K as filed with the
Securities and Exchange Commission.
Note 2 - Consolidation
Effective September 1, 1997, American European Middle East Corporation,
L.L.C. ("AEMEC") entered into an agreement with Middle East Colleges, Ltd.
("MEC") to modify certain aspects of their joint venture agreement relating to
the operation of the American University in Dubai ("Dubai"). These
modifications give effective control of the joint venture to AEMEC as defined in
Statement of Financial Accounting Standards No. 94, "Consolidation of All
Majority-Owned Subsidiaries," and require consolidation of the financial
statements of Dubai with those of the Company as of September 1, 1997. Prior to
such date, AEMEC's portion of the net income from Dubai had been reported in the
income statement of the Company as "income from management agreement." Effective
September 1, 1997, the Company records MEC's ownership interest in the joint
venture of 49.9% as minority interest in the consolidated financial statements.
Note 3 - New Accounting Pronouncements
Statement of Financial Accounting Standards No. 130, "Reporting
Comprehensive Income" ("SFAS No. 130") is effective for the Company's fiscal
year ending May 31, 1999. SFAS No. 130 establishes standards for reporting and
displaying comprehensive income and its components (revenues, expenses, gains,
and losses) in a full set of general purpose financial statements. The Company
has adopted SFAS No. 130 in the current fiscal year as required. The components
of comprehensive income are as follows (in thousands):
<TABLE>
<CAPTION>
Three Months Ended August 31,
1998 1997
----------- ------------
<S> <C> <C>
Net loss $ (985) $(962)
Change in equity due to foreign currency translation adjustments (34) (33)
----------- ------------
Comprehensive loss $(1,019) $(995)
=========== ============
</TABLE>
Statement of Financial Accounting Standards No. 131, "Disclosure about
Segments of an Enterprise and Related Information" ("SFAS No. 131") is also
effective for the Company's fiscal year ending May 31, 1999. SFAS No. 131
establishes standards for the way that public business enterprises report
information about operating segments and related information in annual financial
statements and requires that those enterprises report selected information about
operating segments and related information in interim financial reports in the
second year of application. This statement does not significantly alter the
disclosures the Company provides.
4
<PAGE>
Note - 4 Subsequent Events
On October 2, 1998, the Company entered into a 12-month lease for a 13,352
square foot building for its Miami, Florida campus. The Company will incur rent
payments of approximately $252,000 for the twelve month period beginning October
1, 1998.
5
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The following discussion of the results of operations and financial
condition of the Company should be read in conjunction with the "Selected
Consolidated Financial Data" and the Company's Consolidated Financial Statements
and Notes thereto for the fiscal year ended May 31, 1998 included in the
Company's Annual Report on Form 10-K as filed with the Securities and Exchange
Commission, as well as in conjunction with the consolidated financial statements
and notes thereto for the three months ended August 31, 1998 included in Item 1.
Unless otherwise specified, any reference to a "fiscal year" is to a fiscal year
ended May 31.
This Quarterly Report on Form 10-Q contains forward-looking statements.
Additional written or oral forward-looking statements may be made by the Company
from time to time in filings with the Securities and Exchange Commission or
otherwise. The words "believe," "plan," "expect," "anticipate," "project" and
similar expressions identify forward-looking statements, which speak only as of
the date the statement was made. Such forward-looking statements are within the
meaning of that term in Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended. Such
statements may include, but are not limited to, projections of revenues, income
or loss, expenses, capital expenditures, plans for future operations, financing
needs or plans, the impact of inflation and plans relating to products or
services of the Company, as well as assumptions relating to the foregoing. The
Company undertakes no obligation to publicly update or revise any forward-
looking statements, whether as a result of new information, future events, or
otherwise.
Forward-looking statements are inherently subject to risks and
uncertainties, some of which cannot be predicted or quantified. Future events
and actual results could differ materially from those set forth in, contemplated
by, or underlying the forward-looking statements. Statements in this Quarterly
Report, including Notes to Consolidated Financial Statements and "Management's
Discussion and Analysis of Financial Condition and Results of Operations,"
describe factors, among others, that could contribute to or cause such
differences. Additional factors that could cause actual results to differ
materially from those expressed in such forward-looking statements include,
without limitation, new or revised interpretations of regulatory requirements,
changes in or new interpretations of other applicable laws, rules and
regulations, failure to maintain or renew required regulatory approvals,
accreditation or state authorizations, failure to obtain the Southern
Association of Colleges and Schools' ("SACS") approval to operate in new
locations, changes in student enrollment, and other factors set forth in this
Quarterly Report on Form 10-Q and other reports or materials filed or to be
filed with the Securities and Exchange Commission (as well as information
included in oral statements or other written statements made or to be made by
the Company or its management).
Results of Operations
The following table sets forth, for the periods indicated, the percentage
relationship of certain statement of operations items to net revenues for the
Company:
<TABLE>
<CAPTION>
Three Months Ended August 31,
1998 1997
------- -------
<S> <C> <C>
Net revenues 100.0% 100.0%
Costs and expenses:
Cost of education and facilities 56.1% 47.8%
Selling and promotional expenses 23.2% 21.0%
General and administrative expenses 36.1% 36.0%
Amortization of goodwill 3.2% 4.0%
------- -------
Total costs and expenses 118.6% 108.8%
------- -------
Loss from campus operations (18.6%) (8.8%)
Income from management agreement 0.0% 0.4%
------- -------
Loss from operations (18.6%) (8.4%)
Interest expense (0.4%) (14.6%)
Other income -- net 0.8% 0.0%
------- -------
Loss before income taxes and minority interest (18.2%) (23.1%)
Income tax benefit 6.2% 7.6%
------- -------
Loss before minority interest (12.0%) (15.5%)
Minority interest in earnings of American University in Dubai (0.5%) 0.0%
------- -------
Net loss (12.5%) (15.5%)
======= =======
</TABLE>
6
<PAGE>
Three Months Ended August 31, 1998 Compared to Three Months Ended August 31,
1997
NET REVENUES. Net revenues increased by approximately $1.6 million or 25.6%
from $6.2 million for the three months ended August 31, 1997 (the "1997 period")
to $7.8 million for the three months ended August 31, 1998 (the "1998 period").
Of the 25.6% increase, 13.0% or approximately $809,000 was due to the
consolidation of Dubai (see note 2 of notes to consolidated financial
statements). The remaining increase in net revenues was due to an increase in
student enrollments and a tuition increase.
COST OF EDUCATION AND FACILITIES. Cost of education and facilities increased
approximately $1.4 million or 47.5% from $3.0 million in the 1997 period to $4.4
million in the 1998 period. Education costs increased approximately $1.2
million or 71.9% from $1.7 million in the 1997 period to $2.9 million in the
1998 period due to the consolidation of Dubai and salary and other cost
increases. Facility costs increased approximately $179,000 or 14.3% from $1.3
million in the 1997 period to $1.4 million in the 1998 period primarily due to
the consolidation of Dubai. Cost of education and facilities increased as a
percentage of net revenues from 47.8% in the 1997 period to 56.1% in the 1998
period.
SELLING AND PROMOTIONAL EXPENSES. Selling and promotional expenses increased by
approximately $510,000 or 39.0% from $1.3 million in the 1997 period to $1.8
million in the 1998 period. Of the 39.0% increase, 5.4% or approximately
$71,000 was due to the consolidation of Dubai. The remaining increase was due
to increases in salary and other selling and promotional expenses related to new
educational programs such as the Masters in Information Technology, the
Bachelors in Information Technology, and the Bachelors in Business
Administration for adult evening students. As a percentage of net revenues,
selling and promotional expenses increased from 21.0% in the 1997 period to
23.2% in the 1998 period.
GENERAL AND ADMINISTRATIVE EXPENSES. General and administrative expenses
increased approximately $586,000 or 26.1% from $2.2 million in the 1997 period
to $2.8 million in the 1998 period. Of the 26.1% increase, 7.6% or
approximately $170,000 was due to the consolidation of Dubai. The remaining
increase was primarily due to additions of personnel at the home office to
support the Company's growth. As a percentage of net revenues, general and
administrative expenses remained relatively the same at 36.0% in the 1997 period
and 36.1% in the 1998 period.
AMORTIZATION OF GOODWILL. Goodwill amortization of $252,000 for both periods
was the result of the October 1996 acquisition of American European Corporation
and Subsidiaries with goodwill costs being amortized over a 40-year period.
INCOME FROM MANAGEMENT AGREEMENT. As a result of the consolidation of Dubai
effective September 1, 1997, there was no income from the Dubai management
agreement in the 1998 period. The portion of income from operations related to
Dubai is approximately $61,000, which represents an increase in enrollment of
36% offset by a one-time expense relating to graduation exercises at the Dubai
campus.
INTEREST EXPENSE. Interest expense decreased approximately $875,000 or 96.2% in
the 1998 period compared to the 1997 period as a result of the application of
the proceeds of the Company's September 1997 initial public offering to retire
debt.
OTHER INCOME - NET. Other income - net increased from zero in the 1997 period
to approximately $61,000 in the 1998 period primarily due to investment income
on a portion of the proceeds of the Company's September 1997 initial public
offering.
MINORITY INTEREST IN EARNINGS OF AMERICAN UNIVERSITY IN DUBAI. Effective
September 1, 1997, the Company modified its joint venture agreement relating to
Dubai, which resulted in the change in presentation of income from management
agreement to minority interest in earnings (see note 2 of notes to consolidated
financial statements).
7
<PAGE>
SEASONALITY
The Company experiences seasonality in its results of operations primarily
as a result of changes in the level of student enrollments. While the Company
enrolls students throughout the year, the Company's first and second fiscal
quarter enrollments and related revenues generally are lower than the third and
fourth fiscal quarters due to traditionally lower student enrollment levels in
the summer terms (first fiscal quarter is comprised of the Summer I term and
one-half of the Summer II term; second fiscal quarter is comprised of one-half
of the Summer II term and two-thirds of the Fall term). First and second fiscal
quarter costs and expenses historically are higher as a percentage of net
revenues as a result of certain fixed costs which are not significantly affected
by the seasonal first and second fiscal quarter declines in net revenues.
LIQUIDITY AND CAPITAL RESOURCES
The Company finances its operating activities and capital requirements,
including debt repayments, principally from cash provided by operating
activities, borrowings under the NationsBank Credit Agreement (the "Credit
Agreement"), and cash proceeds from the initial public offering. The Credit
Agreement provides that, beginning on October 1, 1998, the maximum permitted
borrowings is $1.0 million. Amounts outstanding bear interest at 9.5%. The
Company experienced negative operating cash flow of approximately $315,000 for
the 1998 period. The Company's principal sources of funds as of August 31, 1998
were cash and cash equivalents of $2.7 million and available borrowings of $1.0
million under the Credit Agreement.
At August 31, 1998, the Company had no outstanding borrowings under the
Credit Agreement. The Credit Agreement is renewable annually and any amounts
borrowed are payable upon its termination on October 1, 1999.
The increase in investing activities compared to the 1997 period was
principally due to the increase in the number of locations and to curriculum
licensing costs associated with the Company's expansion. Purchases of property,
plant, and equipment for the 1998 period were approximately $656,000. Total
purchases of property, plant, and equipment for the year ended May 31, 1999 are
expected to range from $4.5 to $5.5 million. The increase from fiscal year 1998
is due to: (1) the opening of several new campuses; (2) hardware and software
costs related to the installation of a new management information system; (3)
improvements to the Company's computer facilities and telecommunications
equipment at the corporate level; (4) investments in computer technology to
support information technology curriculum; and (5) increases in normal recurring
capital expenditures due to the overall increases in student and employment
levels resulting from the Company's growth. For the three months ended August
31, 1998, curriculum development costs totaled approximately $1.9 million.
Curriculum development costs are not expected to exceed $5.5 million for the
year ended May 31, 1999, including a $900,000 per-site license fee payable to
ITI Education Corporation and additional staff dedicated to curriculum
development. For the three months ended August 31, 1998, start-up costs totaled
approximately $31,000. Start-up costs are expected to be no greater than $1.0
million for the year ended May 31, 1999. The Company expects to fund these
capital expenditures for new campuses through cash from operations and a
proposed amendment to the Credit Agreement, currently under negotiation, which
will increase the Company's borrowing capacity.
On October 15, 1998, the Company announced that its Board of Directors had
approved a stock repurchase program authorizing the repurchase of up to 1
million shares of the Company's Class A Common Stock over the next six months.
Purchases would be made from time to time as market and business conditions
warrant, in open market, negotiated or block transactions. The Company expects
to fund any such repurchases through cash flow and a new bank line of credit
currently being negotiated.
The Company's ability to fund its working capital and capital expenditure
requirements, implement new programs, make interest payments, fund future
acquisitions, and meet its other cash requirements, depends on, among other
things, current cash and cash equivalents, internally generated funds, and the
Company's Credit Agreement. Management believes that such sources will be
sufficient to meet the Company's capital requirements and operating needs for
the remainder of the fiscal year. However, if there is a significant reduction
of internally generated funds, the Company may require additional funds from
outside sources. In such event, there can be no assurance that the Company will
be able to obtain such funding as and when required or on acceptable terms.
The Department of Education requires that Title IV program funds collected
by an institution for unbilled tuition be kept in a separate cash or cash
equivalent account until the students are billed for the portion of their
program related to these funds. In addition, all funds transferred to the
Company through electronic funds transfer programs are held in a separate cash
account until certain conditions are satisfied. As of August 31, 1998, the
Company had approximately $102,000 in these separate accounts to comply with
these requirements. These funds
8
<PAGE>
generally remain in these separate accounts for an average of 60 to 75 days from
the date of collection. These restrictions on cash have not affected the
Company's ability to fund daily operations.
YEAR 2000 COMPLIANCE
Some of the Company's computer information systems are not currently
configured to recognize the year 2000 in the two digit date field used by such
system. The Company is currently implementing a new centralized information
system to integrate its operations and financial data including admissions,
financial aid, student services, placement services, and default management. The
new system is designed to properly recognize the year 2000 in the two digit date
field. The Company anticipates that the information system will be fully
operational by the end of fiscal year 1999 and that it will require a total of
approximately $2 million in fiscal year 1998 and fiscal year 1999 to develop and
implement this integrated information system although there can be no assurance
that the new system will be implemented on a timely basis or the total
expenditures will not exceed $2 million. Management does not anticipate that the
expenditure of such funds to implement the new computer system will have a
material impact on the Company's results of operations, liquidity, or capital
resources. In the event this information system is not implemented in a timely
fashion, management will evaluate other available options to revise its computer
programs, as necessary, for the effect of the year 2000 problem including,
without limitation, relying on manual record keeping until full compliance is
achieved.
The Company has reviewed its material relationships with third parties such
as vendors and evaluated the consequences of third party year 2000 problems on
the Company. The Company does not believe year 2000 problems of these third
parties pose a material risk to the Company.
IMPACT OF INFLATION
The Company does not believe its operations have been materially affected
by inflation.
9
<PAGE>
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
27 - Financial Data Schedule (for SEC use only)
(b) Reports on Form 8-K. No report on Form 8-K was filed during the
quarter ended August 31, 1998.
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.
EDUTREK INTERNATIONAL, INC.
Date: October 13, 1998 By: /s/ Steve Bostic
-----------------
Steve Bostic, President and
Chief Executive Officer
(principal executive officer)
Date: October 13, 1998 By: /s/ Daniel D. Moore
--------------------
Daniel D. Moore, Chief Financial
Officer (principal financial and
accounting officer)
11
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAY-31-1999
<PERIOD-START> JUN-01-1998
<PERIOD-END> AUG-31-1998
<CASH> 2,694
<SECURITIES> 0
<RECEIVABLES> 6,188
<ALLOWANCES> 126
<INVENTORY> 0
<CURRENT-ASSETS> 9,492
<PP&E> 8,151
<DEPRECIATION> 0
<TOTAL-ASSETS> 59,816
<CURRENT-LIABILITIES> 13,188
<BONDS> 0
0
0
<COMMON> 40,566
<OTHER-SE> 2,738
<TOTAL-LIABILITY-AND-EQUITY> 59,816
<SALES> 7,825
<TOTAL-REVENUES> 7,825
<CGS> 9,287
<TOTAL-COSTS> 9,287
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 35
<INCOME-PRETAX> (1,436)
<INCOME-TAX> (489)
<INCOME-CONTINUING> (985)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (985)
<EPS-PRIMARY> (0.09)
<EPS-DILUTED> 0
</TABLE>
