FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 30, 1998
Commission File No. 000-23115
CTI INDUSTRIES CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 36-2848943
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
22160 North Pepper Road, Barrington, Illinois 60010
(Address of principal executive offices) (Zip Code)
(847) 382-1000
(Registrant's telephone number, including area code)
Registrant 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 and
has been subject to such filing requirements for the past 90 days.
APPLICABLE ONLY TO CORPORATE ISSUERS:
COMMON STOCK, $.065 par value, 2,725,643 outstanding Shares and CLASS B
COMMON STOCK, $.91 par value, 1,098,901 outstanding Shares, as of April 30,
1998.
<PAGE>
Part I. FINANCIAL INFORMATION
Item 1. Financial Statements
The following consolidated financial statements of the Registrant are
attached to this Form 10-QSB:
1. Interim Balance Sheet as of April 30, 1998 and
Balance Sheet as of October 31, 1997.
2. Interim Statements of Operations for the three and
six month periods ending April 30, 1998 and April 30,
1997.
3. Interim Statements of Cash Flows for the six month
periods ending April 30, 1998 and April 30, 1997.
The Financial Statements reflect all adjustments which are, in the
opinion of management, necessary to a fair statement of results for the periods
presented.
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operation
Results of Operations
Net Sales. For the fiscal quarter ended April 30, 1998, net sales
increased to $5,492,000 from $4,065,000 for the first fiscal quarter of 1997, an
increase of approximately 35%. The Company experienced increases in sales, as
compared to the second quarter of fiscal 1997, in each of its product lines --
mylar balloons, latex balloons and printed and laminated films. Net sales for
the first six months of fiscal 1998 were $11,332,000 as compared to $8,736,000
for the same period of 1997.
Cost of Sales. For the quarter ended April 30, 1998, cost of sales
increased to 58.9% of net sales as compared to 54.4% of net sales in the second
fiscal quarter of 1997. The increase was a result of a higher direct labor rate
and increases in certain overhead expenses (overtime premium, payroll taxes and
real estate taxes). Cost of goods sold were 59.1% of net sales for the first six
months of fiscal 1998, as compared to 61.6% for the same period of 1997.
Administrative. For the quarter ended April 30, 1998, administrative
expenses were $697,000, or 12.7% of sales as compared to $469,000, or 11.5% of
sales for the second fiscal quarter of 1997. Administrative expenses were
$1,223,000 or 10.8% of net sales for the first six months of fiscal 1998, as
compared to $900,000 or 10.3% of net sales for the first six months of 1997. The
increase was due in part to increased costs resulting from the Company's status
as a public company, and an increase in administrative salaries.
2
<PAGE>
Selling. For the quarter ended April 30, 1998, selling expenses were
$708,000, or 12.9% of net sales, as compared to $693,000, or 17% of net sales
for the second fiscal quarter of 1997. The percentage decrease was due to the
Company's ability to increase sales while maintaining selling expense levels.
For the first six months of fiscal 1998 selling expenses were $1,449,000 or
12.8% of net sales as compared to $1,364,000 or 15.6% of net sales for the first
six months of 1997.
Advertising and Marketing. For the quarter ended April 30, 1998,
advertising and marketing expenses were $462,000 or 8.4% of net sales as
compared to $265,000 or 6.5% of net sales in the second fiscal quarter of 1997.
Advertising and marketing expenses were $941,000 or 8.3% of net sales for the
first six months of 1998 as compared to $468,000 or 5.3% of net sales for the
same period of 1997. The increase in these expenses was a result of catalogue
printing costs and service fees and rebates paid on national account sales
programs.
Net Income or Loss. For the quarter ended April 30, 1998, the Company
had income before income taxes of $335,000 as compared to income before income
taxes of $293,000 for the second fiscal quarter of 1997. The provision for
income tax for the second quarter of fiscal 1998 was $98,000 resulting in net
income of $238,000 as compared to no provision for the same quarter of 1997 as a
result of loss carry forwards. For the second quarter of 1998, the entire income
of $238,000 was allocable to Common Stock, whereas in the second quarter 1997,
$260,000 of income was allocable to the Common Stock and the remaining $33,000
was allocable to the then outstanding Convertible Preferred Stock. Convertible
Preferred Stock was converted to Class B Common Stock in November of 1997. For
the six months ended April 30, 1998, net income was $563,000 (all attributed to
Common Stock) as compared to $391,000 for the first six months of fiscal 1997
(with $65,000 being allocable to Convertible Preferred Stock and $326,000
allocable to Common Stock).
Financial Condition
Liquidity and Capital Resources. Cash flow used in operations during
the six months ended April 30, 1998, was $2,437,000. This resulted primarily
from increased sales and resulting increases in accounts receivable and
inventory of over $3,173,000. During the first six months of 1997, the Company
had cash flows used in operations of $911,000 mainly as a result of increases in
accounts receivable of $1,022,000.
At October 31, 1997, the Company maintained a cash balance of $237,000.
In November of 1997, the Company sold 1,725,000 shares of its Common Stock at
$4.00 per share in an initial public offering. The net proceeds from the
offering to the Company were approximately $5,500,000. The Company's cash
balance at April 30, 1998 was $1,291,000.
Investment Activities. During the six months ended April 30, 1998 and
April 30, 1997, the Company invested $1,199,000 and $343,000, respectively, in
machinery and equipment and merchandise displays at customer locations. The
Company also invested in and advanced to its Mexican supplier of latex balloons
$1,350,000 in the first six months of 1998.
3
<PAGE>
Financing Activities. For the six months ended April 30, 1998, the
Company generated $6,045,000 in financing activities, primarily as a result of
the proceeds of the Company's initial public offering of its Common Stock in
November of 1997. Cash flow provided by financing activities for the six months
ended April 30, 1997, was $1,155,000 resulting primarily from advances on lines
of credit.
The Company believes that existing capital resources and cash generated
from operations, will be sufficient to meet the Company's requirements for at
least 12 months.
Seasonality. In the mylar product line, sales have historically been
seasonal with approximately 20% to 27% of annual sales of mylar being generated
in December and January and 11% to 13% of annual mylar sales being generated in
June and July in recent years. The sale of latex balloons and laminated film
products have not historically been seasonal.
Forward Looking Statements. Forward looking statements made in this
filing involve material risks and uncertainties that could cause actual results
and events to differ materially from those set forth, or implied, including (i)
the Company's ability to enter into contracts with licensors, suppliers,
distributors, and strategic partners, (ii) the Company's growth strategy and
(iii) anticipated trends in the Company's business, as well as other risks and
uncertainties reported in the Company's other SEC filings.
Part II. OTHER INFORMATION
Item 1. Legal Proceedings
Not applicable.
Item 2. Changes in Securities
In March and May of 1996, a group of investors made an equity
investment of $1,000,000 in the Company in return for 1,098,901 shares of
Preferred Stock, $.91 par value. Each share of Preferred Stock was entitled to
an annual cumulative dividend of 13% of the purchase price, and was convertible
into one share of Common Stock. The shares of Preferred Stock, voting separately
as a class, were entitled to elect four of the Company's directors.
In July, 1997, the Company effected a recapitalization (the
"Recapitalization") without a formal reorganization. As part of the
Recapitalization, the Board of Directors approved the creation of Class B Common
Stock, approved a 1 for 2.6 reverse stock split on both the Common Stock and
Preferred Stock, and negotiated a conversion of all then outstanding shares of
4
<PAGE>
the Company's Convertible Preferred Stock into an aggregate of 1,098,901 shares
of Class B Common Stock. The conversion was effective upon the closing of the
initial public offering of the Company's Common Stock in November of 1997. The
shares of Class B Common Stock contain rights identical to shares of Common
Stock, except that shares of Class B Common Stock, voting separately as a class,
have the right to elect four of the Company's seven directors. Shares of Common
Stock and Class B Common Stock, voting together as a class, vote on all other
matters, including the election of the remaining directors. The
recapitalization, initial public offering and related transactions were approved
by written consent of the shareholders.
Item 3. Defaults Upon Senior Securities
Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders
On May 1, 1998, the annual meeting of shareholders of the Company was
held. The Company's current Board of Directors was re-elected.
Item 5. Other Information
Not applicable.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits*
(b) The Company has not filed a Current Report during the
quarter covered by this report.
* Also incorporated by reference the Exhibits filed as
part of the SB-2 Registration Statement of the
Registrant, effective November 5, 1997, and
subsequent periodic filings.
5
<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.
Dated: June 12, 1998 CTI INDUSTRIES CORPORATION
By: /s/ Stephen M. Merrick
--------------------------------------
Stephen M. Merrick, Chief Executive
Officer and Principal Financial Officer
6
<PAGE>
CTI Industries Corporation and Subsidiary
Consolidated Balance Sheet
<TABLE>
<CAPTION>
April 30, 1998 October 31, 1997
(Unaudited) (See note)
------------ ------------
ASSETS
<S> <C> <C>
Current assets:
Cash $ 1,291,353 $ 237,230
Accounts Receivable (less allowance for doubtful
accounts of $148,275 and $136,050 at
April 30, 1998 and October 31, 1997) 4,289,621 3,045,696
Inventories 6,891,840 5,073,861
Deferred tax assets 327,035 327,035
Other 807,249 483,652
------------ ------------
Total current assets 13,607,098 9,167,474
Property and equipment:
Machinery and equipment 7,651,448 6,711,978
Building 2,181,647 2,175,713
Office furniture and equipment 1,470,057 1,058,150
Land 250,000 250,000
Leasehold improvements 147,128 147,128
Projects under construction 244,133 402,714
------------ ------------
11,944,413 10,745,683
Less : accumulated depreciation (7,278,777) (6,851,148)
------------ ------------
Total property and equipment, net 4,665,636 3,894,535
Other assets:
Deferred IPO costs -- 445,067
Deferred financing costs, net 51,991 56,671
Invesment in subsidiaries 933,801 81,816
Note receivable 730,000 300,000
Deferred tax assets 272,063 272,063
------------ ------------
Total other assets 1,987,855 1,155,617
------------ ------------
TOTAL ASSETS $ 20,260,589 $ 14,217,626
============ ============
<FN>
See accompanying notes
</FN>
</TABLE>
7
<PAGE>
CTI Industries Corporation and Subsidiary
Consolidated Balance Sheet
<TABLE>
<CAPTION>
April 30, 1998 October 31, 1997
(Unaudited) (See note)
------------ ------------
LIABILITIES AND STOCKHOLDERS' EQUITY
<S> <C> <C>
Current liabilities:
Accounts payable $2,507,238 $3,725,500
Line of credit 3,297,283 3,017,940
Stock redemption contract payable - current portion -- 30,533
Notes payable - current portion 1,259,281 580,097
Accrued liabilities 1,528,335 871,182
------------- ------------
Total current liabiliites 8,592,137 8,225,252
Long-term liabilities:
Notes payable 2,683,174 2,885,151
Subordinated debt 865,000 865,000
------------- ------------
Total long-term liabilities 3,548,174 3,750,151
Redeemable common stock 431,361 450,000
Stockholders' equity:
Convertible preferred stock - $.91 par value,
2,000,000 shares authorized, 1,098,901 shares
issued and outstanding, including accumulated
dividends of $63,917 at October 31, 1997 -- 1,063,917
Common stock - $.065 par value, 11,000,000 shares
authorized, 2,879,584 (April 30, 1998) and
1,154,58 (October 31, 1997)shares issued,
2,725,643 (April 30, 1998) and 1,010,202
(October 31, 1997) shares outstanding 187,173 75,048
Class B common stock - $.91 par value,
1,100,000 shares authorized, 1,098,901 shares
outstanding at April 30, 1998 1,000,000 --
Paid-in-capital 5,537,942 248,348
Retained earnings 1,742,509 1,179,274
Foreign currency translation adjustment 46,693 51,036
Less:
Treasury stock - 153,941 (April 30, 1998) and (389,339) (370,700)
144,382 (October 31, 1997) shares at cost
Redeemable common stock (431,361) (450,000)
Stock subscription receivable (4,700) (4,700)
------------- ------------
Total stockholders' equity 7,688,917 1,792,223
------------- ------------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $20,260,589 $14,217,626
============= ============
<FN>
Note: The balance sheet at October 31, 1997 has been derived from the audited
consolidated financial statements at that date, but does not include all of the
information and footnotes required by generally accepted accounting principles
for complete statements.
See accompanying notes
</FN>
</TABLE>
8
<PAGE>
CTI Industries Corporation and Subsidiary
Consolidated Statement of Operations
<TABLE>
<CAPTION>
Quarter Ended April 30 Year to Date April 30
1998 1997 1998 1997
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
------------ ------------ ------------ ------------
<S> <C> <C> <C> <C>
Net Sales $ 5,492,346 $ 4,064,525 $ 11,331,580 $ 8,736,121
Cost of Sales 3,233,488 2,210,377 6,694,577 5,384,031
------------ ------------ ------------ ------------
Gross profit on sales 2,258,858 1,854,148 4,637,003 3,352,090
Operating expenses:
Administrative 697,324 469,463 1,223,306 900,385
Selling 708,165 692,843 1,448,724 1,363,865
Advertising and marketing 462,452 265,319 941,148 468,344
------------ ------------ ------------ ------------
Total operating expenses 1,867,941 1,427,625 3,613,178 2,732,594
------------ ------------ ------------ ------------
Income from operations 390,917 426,523 1,023,825 619,496
Other income (expense):
Interest income 40,759 -- 91,577 --
Interest expense (191,178) (161,100) (368,336) (303,942)
Lease income 22,169 -- 22,169 --
Income from investments 50,456 -- 50,456 --
Other 22,352 27,424 47,744 75,137
------------ ------------ ------------ ------------
Total other expense (55,442) (133,676) (156,390) (228,805)
------------ ------------ ------------ ------------
Income before income taxes 335,475 292,847 867,435 390,691
Income tax expense (benefit) 97,500 (158) 304,200 --
------------ ------------ ------------ ------------
Net income 237,975 293,005 563,235 390,691
Dividends applicable to convertible
preferred stock -- (32,500) -- (65,000)
------------ ------------ ------------ ------------
Income applicable to common shares $ 237,975 $ 260,505 $ 563,235 $ 325,691
============ ============ ============ ============
Basic income per common and
common equivalent shares $ 0.06 $ 0.26 $ 0.15 $ 0.33
============ ============ ============ ============
Diluted income per common
and common equivalent shares $ 0.06 $ 0.13 $ 0.14 $ 0.18
============ ============ ============ ============
Weighted average number of shares and
equivalent shares of common stock
outstanding
Basic 3,832,297 990,971 3,765,284 989,048
============ ============ ============ ============
Diluted 4,178,167 2,216,681 4,126,660 2,214,758
============ ============ ============ ============
<FN>
See accompanying notes
</FN>
</TABLE>
9
<PAGE>
CTI Industries Corporation and Subsidiary
Consolidated Statement of Cash Flows
<TABLE>
<CAPTION>
Six Months Ended April 30
1998 1997
(Unaudited) (Unaudited)
----------- -----------
Cash Flow Provided by Operations:
<S> <C> <C>
Net income $ 563,235 $ 390,691
Adjustment to reconcile net income:
Depreciation and amortization 432,308 230,702
Equity in earnings of P&TF and CTF (50,456) --
Gain on sale of property and equipment -- (42,942)
Provision for losses on A/R & inventory 111,255 72,600
Change in assets and liabilities:
Change in accounts receivable (1,265,610) (1,022,464)
Change in inventory (1,907,548) (183,547)
Change in other assets 241,307 (87,364)
Change in accounts payable & accrued expenses (561,111) (268,704)
----------- -----------
Total Cash Flow Used by Operations (2,436,620) (911,028)
Cash Flow Provided by Investing Activities:
Proceeds from sale of property and equipment -- 2,942
Purchases of property and equipment (1,198,730) (343,193)
Investment in and advances to P&TF (1,350,000) --
Investment in joint venture (1,529) (34,575)
----------- -----------
Total Cash Flow Used by Investing Activities (2,550,259) (374,826)
Cash Flow Provided by Financing Activities:
Stock redemption contract payments (30,533) (32,807)
Advances on line of credit 9,460,000 1,367,205
Repayments on line of credit (9,180,657) (483,338)
Proceeds from issuance of long term debt 10,630 18,000
Proceeds from issuance of short term debt 850,000 --
Repayment of long term debt (383,423) (200,874)
Proceeds from debt issued to related parties -- 375,600
Proceeds from issuance of preferred stock -- 160,000
Proceeds from issuance of common stock 5,401,883 --
Conversion of preferred stock (1,000,000) --
Purchase treasury stock (18,639) --
Proceeds from conversion of preferred stock 1,000,000 --
Dividends paid (63,917) (48,750)
----------- -----------
Total Cash Flow Provided by Financing Activities 6,045,344 1,155,036
Effect of exchange rate changes on cash (4,342) --
----------- -----------
Increase (Decrease) in Cash and Equivalents 1,054,123 (130,818)
Cash and Equivalents at Beginning of Period 237,230 130,818
----------- -----------
Cash and Equivalents at End of Period $ 1,291,353 $ --
=========== ===========
Supplemental disclosures:
Cash paid for interest $ 400,820 $ 328,319
Cash paid for income taxes $ 140,000 $ --
Non-cash financing activities:
Assets exchanged for settlement of debt -- $ 40,000
Common stock warrants exercised in exchange for
contractual services received -- $ 19,500
<FN>
See accompanying notes
</FN>
</TABLE>
10
<PAGE>
April 30, 1998
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-QSB and Article 10 of
Regulation S-X. 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 accruals) considered necessary for a fair presentation have
been included. Operating results for the six-month period ended April 30, 1998
are not necessarily indicative of the results that may be expected for the year
ended October 31, 1998. For further information, refer to the consolidated
financial statements and footnotes thereto included in the Registrant Company
and Subsidiaries' annual report on Form 10-K for the year ended October 31,
1997.
Note 2 - P&TF Transaction
On January 26, 1998, the Company and Pulidos et Terminados Finos S.A. de C.V.
("P&TF") entered into an agreement under which (i) the Company subscribed for
45% of the outstanding capital stock of P&TF for $800,000, (ii) the Company
loaned to P&TF $850,000 collateralized by certain latex balloon manufacturing
equipment, and (iii) the 1995 equipment purchase agreement between the parties
was cancelled with respect to 2 pieces of latex balloon manufacturing equipment,
which equipment is now owned by CTI and leased to P&TF. The purchase of the
capital stock was effective February 1, 1998, and the purchase price for the
capital stock was paid by (i) applying $400,000 of advances made to P&TF prior
to closing and (ii) a cash payment for the balance. The $400,000 debt owing to
the Company from the 1995 acquisition was extinguished as a result of the
cancellation of the sales of the two pieces of equipment to P&TF. Funding for
the purchase of the P&TF stock was provided from general operating funds of the
Company and, for the loan to P&TF, by a loan to the Company from First American
Bank. At the time of the transaction, the suspension of payments proceeding
relating to P&TF (in the nature of a Chapter XI bankruptcy reorganization
proceeding) was terminated.
Note 3 - Commitments
In April 1998, the Company entered into an agreement to purchase new extrusion
equipment. The equipment is anticipated to cost approximately $1,941,000, and
will be financed by a new loan to the Company from First American Bank.
Note 4 - Debt Restructuring
In May 1998, the Company restructured its debt with First American Bank. The new
credit arrangements provide for consolidation of certain term loans at reduced
interest rates, and an increase in the revolving line of credit from $3,250,000
to $4,000,000.
Note 5 - Earnings Per Share
In November 1997, the Company adopted the provisions of SFAS No. 128, "Earnings
per Share". Adoption of this pronouncement did not have a material impact on the
Company's financial statements. The provisions of SFAS No.
128 were applied to the prior period presented.
Basic income per common share is computed by dividing income available to common
shareholders, net income less preferred stock dividends, if applicable, by the
weighted average number of shares of common stock outstanding during each
period.
Diluted income per common share for the quarter ended April 30, 1998 and year to
date April 30, 1998 is computed by dividing net income by the weighted average
number of shares of common stock and common stock equivalents (stock options and
warrants), unless anti-dilutive, during the period.
11
<PAGE>
April 30, 1998
Diluted income per common share for the quarter ended April 30, 1997 and year to
date April 30, 1997 is computed by dividing net income by the weighted average
number of shares of common stock and common stock equivalents (stock options,
warrants and convertible preferred stock), unless anti-dilutive, during the
period. The weighted average number of shares and equivalent shares of common
stock outstanding during the period ended April 30, 1997 reflects conversion of
all convertible preferred stock into 1,098,901 shares of common stock as of the
beginning of the period.
Income per common share for the periods ended April 30, 1998 and 1997 was
computed as follows (in thousands, except per share amounts):
CTI Industries Corporation and Subsidiary
<TABLE>
<CAPTION>
Quarter Ended April 30 Year to Date April 30
1998 1997 1998 1997
------------------------- -------------------------
Basic
Average shares outstanding:
<S> <C> <C> <C> <C>
Weighted average number of shares
of common stock outstanding
during the period 3,832,297 990,971 3,765,284 989,048
=========== =========== =========== ===========
Net income:
Net income $ 237,975 $ 293,005 $ 563,235 $ 390,691
Less preferred stock dividends -- (32,500) -- (65,000)
----------- ----------- ----------- -----------
Amount for per share computation $ 237,975 $ 260,505 $ 563,235 $ 325,691
=========== =========== =========== ===========
Per share amount $ 0.06 $ 0.26 $ 0.15 $ 0.33
=========== =========== =========== ===========
Diluted
Average shares outstanding:
Weighted average number of shares
of common stock outstanding
during the period 3,832,297 990,971 3,765,284 989,048
Net additional shares assuming stock
options and warrants exercised and
proceeds used to purchase treasury
stock 345,870 126,809 361,376 126,809
Additional shares assuming conversion
of convertible preferred stock -- 1,098,901 -- 1,098,901
----------- ----------- ----------- -----------
Weighted average number of shares
and equivalent shares of
common stock outstanding
during the period 4,178,167 2,216,681 4,126,660 2,214,758
=========== =========== =========== ===========
Net income:
Net income $ 237,975 $ 293,005 $ 563,235 $ 390,691
Less preferred stock dividends -- (32,500) -- (65,000)
----------- ----------- ----------- -----------
Income applicable to common shares $ 237,975 $ 260,505 $ 563,235 $ 325,691
Add dividends on preferred stock
assumed converted
into common shares -- 32,500 -- 65,000
----------- ----------- ----------- -----------
Amount for per share computation $ 237,975 $ 293,005 $ 563,235 $ 390,691
=========== =========== =========== ===========
Per share amount $ 0.06 $ 0.13 $ 0.14 $ 0.18
=========== =========== =========== ===========
</TABLE>
12
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY INFORMATION EXTRACTED FROM FORM 10-QSB FOR THE
QUARTERLY PERIOD ENDED APRIL 30, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FORM 10-QSB.
</LEGEND>
<CIK> 0001042187
<NAME> CTI Industries Corporation
<MULTIPLIER> 1,000
<CURRENCY> dollars
<S> <C>
<PERIOD-TYPE> 6-mos
<FISCAL-YEAR-END> OCT-31-1998
<PERIOD-START> NOV-01-1997
<PERIOD-END> APR-30-1998
<EXCHANGE-RATE> 1.000
<CASH> 1,291
<SECURITIES> 0
<RECEIVABLES> 4,438
<ALLOWANCES> 148
<INVENTORY> 6,892
<CURRENT-ASSETS> 13,607
<PP&E> 11,944
<DEPRECIATION> 7,279
<TOTAL-ASSETS> 20,261
<CURRENT-LIABILITIES> 8,592
<BONDS> 0
0
0
<COMMON> 1,187
<OTHER-SE> 6,502
<TOTAL-LIABILITY-AND-EQUITY> 20,261
<SALES> 11,332
<TOTAL-REVENUES> 11,332
<CGS> 6,695
<TOTAL-COSTS> 6,695
<OTHER-EXPENSES> 3,402
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 368
<INCOME-PRETAX> 867
<INCOME-TAX> 304
<INCOME-CONTINUING> 563
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 563
<EPS-PRIMARY> .15
<EPS-DILUTED> .14
</TABLE>
