SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D)
OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTER ENDED MARCH 31, 1995 COMMISSION FILE NUMBER: 0-7101
INAMED CORPORATION
State of Incorporation: I.R.S. Employer Identification No.:
Florida 59-0920629
3800 Howard Hughes Parkway, Suite #900, Las Vegas, Nevada 89109
Telephone Number: (702) 791-3388
Indicate by check mark whether the Registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter period
that the Registrant was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days. Yes [X] No [ ]
On March 31, 1995 there were 7,502,939 Shares of the Registrant's
Common Stock Outstanding.
This document contains 14 pages.
<PAGE>
INAMED CORPORATION AND SUBSIDIARIES
FORM 10-Q
Quarter Ended March 31, 1995
TABLE OF CONTENTS
Page
----
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets. . . . . . . . . . . . . . . 3
Unaudited Consolidated Income Statements . . . . . . . . 5
Unaudited Consolidated Statements
of Cash Flows . . . . . . . . . . . . . . . . . . . . 6
Notes to the Unaudited Consolidated
Financial Statements . . . . . . . . . . . . . . . . 8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . . 11
PART II - OTHER INFORMATION . . . . . . . . . . . . . . . . . . . . . 13
<PAGE>
<TABLE>
PART I. FINANCIAL INFORMATION
ITEM 1.
INAMED CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<CAPTION>
(Unaudited)
March 31, 1995 December 31, 1994
-------------- -----------------
<S> <C> <C>
Assets
Current assets:
Cash and cash equivalents ................................................. $ -- $ 673,951
Trade accounts receivable, net of
allowance for doubtful accounts and returns
and allowances of $6,029,852 at March 31,
1995 and $6,025,827 at December 31, 1994 .............................. 13,785,384 11,319,487
Notes receivable .......................................................... 707,949 1,400,503
Inventories (Note 3) ...................................................... 16,844,552 14,879,570
Prepaid expenses and other current assets ................................. 1,663,213 2,548,748
Income tax refund receivable .............................................. 464,891 462,304
Deferred income taxes ..................................................... 2,522,138 2,648,653
------------ ------------
Total current assets ................................................. 35,988,127 33,933,216
------------ ------------
Property and equipment, at cost:
Machinery and equipment ................................................... 8,032,030 7,449,622
Furniture and fixtures .................................................... 2,877,015 2,620,594
Leasehold improvements .................................................... 6,284,032 5,469,234
------------ ------------
17,193,077 15,539,450
Less accumulated depreciation
and amortization ...................................................... (7,466,333) (6,819,866)
------------ ------------
Net property and equipment ............................................ 9,726,744 8,719,584
------------ ------------
Notes receivable ............................................................... 2,490,446 2,215,058
Related party notes receivable ................................................. 854,795 688,184
Intangible assets, net ......................................................... 1,878,866 1,956,648
Deferred income taxes .......................................................... -- 48,810
Other assets, at cost .......................................................... 259,619 248,901
------------ ------------
$ 51,198,597 $ 47,810,401
============ ============
<FN>
(continued)
The Notes to Financial Statements are an integral part of this statement.
</TABLE>
<PAGE>
<TABLE>
INAMED CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<CAPTION>
(Unaudited)
March 31, 1995 December 31, 1994
-------------- ----------------
<S> <C> <C>
Liabilities and Stockholders' Equity
Current liabilities:
Current installments of long-term debt ................................ $ 144,300 $ 176,910
Notes payable to bank ................................................. 1,532,408 1,795,721
Related party notes payable ........................................... 971,506 970,610
Accounts payable ...................................................... 14,208,975 15,780,050
Accrued liabilities:
Salaries and wages ................................................ 4,989,648 2,251,275
Interest .......................................................... 567,365 567,365
Self-insurance .................................................... 2,297,632 1,291,605
Stock option compensation ......................................... 68,714 68,714
Other ............................................................. 2,675,245 3,593,024
Royalties payable ..................................................... 984,391 1,053,888
Income taxes payable .................................................. 5,293,230 4,960,352
Deferred income taxes ................................................. 580,731 335,777
------------ ------------
Total current liabilities ....................................... 34,314,145 32,845,291
------------ ------------
Long-term debt, excluding current installments ............................. 14,492 50,801
Deferred grant income ...................................................... 959,435 931,367
Deferred income taxes ...................................................... 306,017 352,115
Litigation settlement ...................................................... 9,152,000 9,152,000
Net stockholders' equity:
Common stock, $0.01 par value
Authorized 20,000,000 shares;
issued and outstanding 7,502,939 .................................. 75,030 74,662
Additional paid-in capital ............................................ 9,783,477 9,699,345
Cumulative translation adjustment ..................................... 1,186,368 437,683
Accumulated deficit ................................................... (4,592,367) (5,732,863)
------------ ------------
Net stockholders' equity ........................................ 6,452,508 4,478,827
Commitments and contingencies (Note 4) ..................................... -- --
$ 51,198,597 $ 47,810,401
============ ============
<FN>
The Notes to Financial Statements are an integral part of this statement.
</TABLE>
<PAGE>
INAMED CORPORATION AND SUBSIDIARIES
CONSOLIDATED INCOME STATEMENTS
(UNAUDITED)
Three Months Three Months
Ended Ended
March 31, 1995 March 31, 1994
-------------- -------------
Net sales .................................... $ 21,744,875 $ 16,896,056
Cost of goods sold ........................... 6,334,312 6,419,644
------------ ------------
Gross profit ........................ 15,410,563 10,476,412
------------ ------------
Operating expenses:
Marketing ............................... 5,381,079 4,051,458
General and administrative .............. 7,608,602 4,476,334
Research and development ................ 1,066,375 853,111
------------ ------------
Total operating expenses ............ 14,056,056 9,380,903
------------ ------------
Operating income .................... 1,354,507 1,095,509
------------ ------------
Other income (expense):
Interest income ......................... 356,647 89,622
Interest expense ........................ (128,743) (50,178)
Foreign currency transaction gains ...... 263,743 400,842
Miscellaneous income .................... 119,211 31,400
------------ ------------
Net other income .................... 610,858 471,686
------------ ------------
Income before income taxes .......... 1,965,365 1,567,195
Income taxes ................................. 824,869 295,253
------------ ------------
Net income .......................... $ 1,140,496 $ 1,271,942
============ ============
Net income per share of common stock ......... $ .15 $ .17
============ ============
Weighted average common shares outstanding ... 7,491,821 7,440,288
============ ============
The Notes to Financial Statements are an integral part of this statement.
<PAGE>
<TABLE>
INAMED CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Three Months ended March 31, 1995 and 1994
Increase (Decrease) in Cash and Cash Equivalents
<CAPTION>
1995 1994
----------- -----------
<S> <C> <C>
Cash flows from operating activities:
Net income .................................................................. $ 1,140,496 $ 1,271,942
----------- -----------
Adjustments to reconcile net income to net
cash provided by (used in) operating
activities:
Depreciation of property and equipment ...................................... 758,659 386,379
Amortization of intangible assets ........................................... 77,699 55,508
Deferred income taxes ....................................................... 358,633 93,248
Changes in assets and liabilities:
Increase in trade accounts receivable ................................... (2,215,168) (384,617)
Decrease in notes receivable ............................................ 417,166 4,366
(Increase) decrease in inventories ...................................... (1,310,035) 862,163
(Increase) decrease in prepaid expenses
and other current assets ............................................. 967,447 (182,657)
Decrease in income tax refund receivable ................................ 1,840 --
(Increase) decrease in other assets ..................................... (10,105) 211
Decrease in accounts payable ............................................ (2,029,370) (1,806,168)
Increase in accrued salaries and wages .................................. 2,680,724 542,344
Increase in accrued interest ............................................ -- 9
Increase (decrease) in accrued self-insurance ........................... 1,006,027 (925,292)
Decrease in other accrued liabilities ................................... (935,272) (542,171)
Increase (decrease) in royalties payable ................................ (69,497) 259,656
Increase in income taxes payable ........................................ 332,878 49,887
Foreign currency translation adjustment ................................. 748,685 (64,370)
----------- -----------
Total adjustments ....................................................... 780,311 (1,651,504)
----------- -----------
Net cash provided by
(used in) operating activities ...................................... 1,920,807 (379,562)
----------- -----------
Cash flows from investing activities:
Purchases of property and equipment ......................................... (1,314,472) (579,977)
----------- -----------
Net cash used in investing activities ....................................... (1,314,472) (579,977)
----------- -----------
<FN>
(continued)
The Notes to Financial Statements are an integral part of this statement.
</TABLE>
<PAGE>
<TABLE>
INAMED CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
Three Months ended March 31, 1995 and 1994
Increase (Decrease) in Cash and Cash Equivalents
<CAPTION>
1995 1994
----------- -----------
<S> <C> <C>
Cash flows from financing activities:
Increases in notes payable and long-term debt ........................................... $ -- $ 627,852
Principal repayment of notes payable
and long-term debt ................................................................... (472,651) (61,942)
(Increase) decrease in related party receivables ........................................ (166,611) 410,745
Increase in related party payables ...................................................... 896 --
Net change in deferred grant income ..................................................... (18,629) 50,744
Repurchases and retirements of common stock ............................................. -- (240,316)
Proceeds from exercise of stock options ................................................. -- 17,400
Issuance of common stock ................................................................ 84,500 --
Cash overdraft .......................................................................... 348,782 251,079
----------- -----------
Net cash provided by (used in)
financing activities ........................................................... (223,713) 1,055,562
----------- -----------
Effect of exchange rate changes on cash ............................................. (1,056,573) (96,023)
----------- -----------
Net increase (decrease) in cash
and cash equivalents ........................................................... (673,951) --
Cash and cash equivalents at beginning of period ............................................. 673,951 --
----------- -----------
Cash and cash equivalents at end of period ................................................... $ -- $ --
----------- -----------
Supplemental disclosure of cash flow information:
Cash paid during the quarter
for:
Interest ............................................................................ $ 139,874 $ 74,603
Income taxes ........................................................................ $ 382,998 $ 110,374
=========== ===========
Disclosure of accounting policy:
For purposes of the consolidated statement of cash flows, the Company
considers all certificates of deposit to be cash equivalents
Certain reclassifications were made to the 1994 Consolidated Statement of
Cash Flows to conform to the 1995 presentation
<FN>
The Notes to Financial Statements are an integral part of this statement.
</TABLE>
<PAGE>
INAMED CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1995
Note 1 - Interim Financial Statements
The accompanying unaudited consolidated financial statements include
all adjustments (consisting only of normal recurring accruals) which are, in the
opinion of management, necessary for fair presentation of the results of
operations for the periods presented. Interim results are not necessarily
indicative of the results to be expected for a full year.
Certain information and footnote disclosures normally included in
financial statements, prepared in accordance with generally accepted accounting
principles, have been condensed or omitted as allowed by Form 10-Q. The
accompanying unaudited consolidated financial statements should be read in
conjunction with the Company's consolidated financial statements for the year
ended December 31, 1994 as filed with the Securities and Exchange Commission on
Form 10-K.
Note 2 - Basis of Presentation and Summary of Significant Accounting Policies
The Company
INAMED Corporation's subsidiaries are McGhan Medical Corporation and
CUI Corporation, which develop, manufacture and sell medical devices principally
for the plastic and general surgery fields; BioEnterics Corporation which
develops, manufactures and sells medical devices and associated instrumentation
to the bariatric and general surgery fields; Biodermis Corporation which
develops, produces and distributes premium products for dermatology, wound care
and burn treatment; Bioplexus Corporation which is a development company that
develops, produces and distributes specialty medical products for use by the
general surgery profession; Flowmatrix Corporation which manufactures high
quality silicone components and devices for INAMED's wholly-owned subsidiaries
and distributes an international line of proprietary silicone products; Medisyn
Technologies Corporation which focuses on the development and promotion of the
merits of the use of silicone chemistry in the fields of medical devices,
pharmaceuticals and biotechnology; INAMED Development Company , which is engaged
in the research and development of new medical devices using silicone-based
technology; McGhan Limited, an Irish corporation which manufactures medical
devices principally for the plastic and general surgery fields; Medisyn
Technologies, Ltd. and Chamfield Ltd., Irish corporations which specialize in
the development of silicone materials for use by INAMED's wholly-owned
subsidiaries; and INAMED B.V., a Netherlands corporation, INAMED B.V.B.A., a
Belgium corporation, INAMED GmbH, a German corporation, INAMED S.R.L., an
Italian corporation, INAMED Ltd., a United Kingdom corporation, INAMED S.A.R.L.,
a French corporation, and INAMED, S.A., a Spanish corporation, which all sell
medical devices on a direct sales basis in the various countries in which they
are located.
Basis of Presentation
The consolidated financial statements include the accounts of INAMED
Corporation and its wholly-owned subsidiaries (collectively referred to as the
Company). All significant intercompany balances and transactions have been
eliminated in consolidation.
Net Income Per Share
Net income per share is based upon the weighted average number of
shares outstanding during each of the respective periods. Common stock
equivalents are excluded since their inclusion would immaterially affect the
calculation or would be antidilutive.
Note 3 - Inventories
<PAGE>
Inventories are summarized as follows:
March 31, 1995 December 31, 1994
--------------- -----------------
Raw materials ...................... $ 2,470,273 $ 2,187,689
Work in process .................... 3,516,981 3,268,947
Finished goods ..................... 10,857,298 9,422,934
----------- -----------
$16,844,552 $14,879,570
=========== ===========
Note 4 - Commitments and Contingencies
INAMED and/or its subsidiaries are defendants in numerous State court
actions and a Federal class action in the United States District Court, Northern
District of Alabama, Southern Division, under Chief Judge Sam C. Pointer, Jr.,
U.S. District Court, regarding Master File No. C892-P-10000-S (Silicone Gel
Breast Implants Product Liability Litigation MDL 926). The claims are for
general and punitive damages substantially exceeding provisions made in the
Company's consolidated financial statements. The accompanying consolidated
financial statements have been prepared assuming that the Company will withstand
the financial results of said litigation.
Several U.S. based manufacturers negotiated a settlement with the
Plaintiffs' Negotiating Committee ("PNC"), and on March 29, 1994 filed a
Proposed Non-Mandatory Class Action Settlement in the Silicone Breast Implant
Products Liability (the "Settlement Agreement") providing for settlement of the
claims as to the class (the "Settlement") as described in the Settlement
Agreement. The Settlement Agreement provides for resolution of any existing or
future claims, including claims for injuries not yet known, under any Federal or
State law, from any claimant who received a silicone breast implant prior to
June 1, 1993. A fairness hearing for the non-mandatory class was held before
Judge Pointer on August 18, 1994. On September 1, 1994, Judge Pointer gave final
approval to the non-mandatory class action settlement.
The Company was not originally a party to the Settlement Agreement.
However, on April 8, 1994 the Company and the PNC reached an agreement which
would join the Company into the Settlement. The agreement reached between the
Company and the PNC added great value to the Settlement by enabling all
plaintiffs and U.S. based manufacturers to participate in the Settlement, and
facilitating the negotiation of individual contributions by the Company,
Minnesota Mining and Manufacturing Company ("3M"), and Union Carbide Corporation
which total more than $440 million.
Under the terms of the Settlement Agreement, the parties stipulate and
agree that all claims of the Settlement Class against the Company regarding
breast implants and breast implant materials shall be fully and finally settled
and resolved on the terms and conditions set forth in the Settlement Agreement.
Under the terms of the Settlement Agreement, the Company will pay $1
million to the Settlement fund for each of 25 years starting three years after
Settlement approval by the Court. The Company recorded a pre-tax charge of $9.1
million in the fourth quarter of 1993. The charge represents the present value
(discounted at 8%) of the Company's settlement of $25 million over a payment
period of 25 years.
Management believes that the Company could not make the financial
contributions as agreed pursuant to the Settlement absent the establishment of a
mandatory ("non-opt-out") settlement class (the "Mandatory Class"). Therefore,
the Company has petitioned the United States District Court, Northern District
of Alabama, Southern Division, for certification of a Mandatory Class under the
provisions of Federal Rule of Civil Procedure. Upon Judge Pointer's preliminary
approval, a notice of a date for the required fairness hearing for the Mandatory
Class will be issued.
<PAGE>
Under the Settlement, $1.2 billion had been provided for "current
claims" (disease compensation claims). In May, 1995, Judge Pointer completed a
preliminary review of current claims which had been filed as of September, 1994,
in compliance with deadlines set by the court. Judge Pointer determined that
based on the preliminary review, it appears that projected amounts of eligible
current claims exceed the $1.2 billion provided in the Settlement. The
Settlement provided that in the event of such over subscription, the amounts to
be paid to eligible current claimants would be reduced and claimants would have
a right to "opt-out" of the Settlement at that time.
In an effort to reduce potential opt-outs, silicone breast implant
manufacturers and the Plaintiffs' Negotiating Committee have begun talks which
may increase the $4.2 billion fund. The parties are currently conducting
negotiations in good faith in accordance with their obligations under the
Settlement. As negotiations are ongoing at this time it would be premature to
predict their outcome or discuss the contents of the negotiations.
The Company has opposed the plaintiffs' claims in these complaints and
other similar actions, and continues to deny any wrongdoing or liability to the
plaintiffs of any kind. However, the extensive burdens and expensive litigation
the Company would continue to incur related to these matters prompted the
Company to work toward and enter into the Settlement which insures a more
satisfactory method of resolving claims of women who have received the Company's
breast implants.
The Company was a defendant with 3M in a case involving three
plaintiffs in Houston, Texas, in March 1994, in which the jury awarded the
plaintiffs $15 million in punitive damages and $12.9 million in damages plus
fees and costs. However, the decision was reversed in March 1995 resulting in no
financial responsibility on the part of the Company.
<PAGE>
ITEM 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Financial Condition
During the first three months of 1995 INAMED Corporation has maintained
its position as one of the largest medical device companies serving the plastic,
reconstructive and general surgical markets world-wide. In order to meet
increased international product needs, the Company has increased production of
its products in Europe through expansion at its manufacturing plant in Ireland
which supplies the majority of the products for the Company's international
market. The Irish facility works closely with the Company's subsidiaries in
Europe to develop new products for that market. Internationally, the Company has
significantly increased its market share due to the use of direct sales methods
rather than distributors wherever financially advantageous to do so. The Company
currently has direct marketing subsidiaries in seven European countries.
The cash balance has declined since December 31, 1994, but the current
ratio at March 31, 1995, of 1.0 to 1 is consistent with the ratio at December
31, 1994 of 1.0 to 1. The majority of the Company's cash flows in the first
three months of 1995 were generated by product sales which is consistent with
prior periods. Growth, regulatory activities and legal expenses continue to use
a significant amount of available cash resources.
In June of 1990, the Company established a $4.5 million comprehensive
financing package for working capital with a major bank that utilizes the
domestic accounts receivable, inventories and certain other assets as
collateral. In December of 1990, the line of credit was increased to $5.3
million. As of March 31, 1995, approximately $568,000 had been drawn on the line
of credit. The weighted average interest rate during the period was 11%.
The Company's line of credit was due for renewal in August, 1993. The
present bank line was not renewable under acceptable terms and conditions, and
was extended until June 30, 1995. The balance due on the credit line as of June
30, 1995 is projected to be approximately $100,000. At that time, the Company
intends to retire the balance of the credit line. The Company believes that it
can start reasonable discussions with lenders for a new credit facility now that
the Company has entered into global settlement agreements. Although there are no
assurances that the Company will be successful in the engagement of a lender,
the Company has made progress in addressing lender concern surrounding the
breast implant litigation through settlement agreements which include mandatory
class certification.
In April 1994, the Company increased its international line of credit
with a major Dutch bank. The current line is $1,540,000 and is collateralized by
the accounts receivable, inventories and certain other assets of INAMED B.V. The
line of credit expires on December 31, 1995. As of March 31, 1995, approximately
$957,000 had been drawn on the line of credit. The interest rate on the line of
credit is European prime discount rate plus 2.5% per annum, at a minimum of 7%
per annum.
McGhan Limited continues to receive grants from the Irish Industrial
Development Authority ("IDA") which include reimbursement for qualified training
expenses, leasehold improvements and capital improvement costs at the Company's
operation in Ireland. Additionally, McGhan Limited has obtained approval for
additional grants from the European Economic Community "Industry R & D
Initiative" for approved research and development programs for up to $1 million.
The Company believes that additional approvals will be achieved in future years.
Results of Operations
Net sales as an aggregate were $21.7 million during the first three
months of 1995 which represents a 29% increase over the first three months of
1994. This increase can be attributed to
<PAGE>
reduced competition and increases in foreign sales. Management expects this
trend of sales growth to continue throughout 1995.
Gross profit was 71% of net sales for the first three months of 1995
compared to 62% for the corresponding period in 1994. Management expects gross
profit to remain consistent or improve somewhat throughout the remaining
quarters of 1995.
Marketing expense as a percentage of net sales was 25% in the first
three months of 1995, which is consistent with 24% for the first three months of
1994.
General and administrative expenses as a percentage of net sales were
35% in the first three months of 1995 compared to 26% in the first three months
of 1994. A portion of the increase relates to the current expansion of
international facilities and the overall growth in sales and production volume
which has been experienced by the Company. Legal fees related to the breast
implant litigation also contributed to the increase. Management expects future
general and administrative expenses to grow proportionally with sales, and to be
reactive to litigation expense.
Research and development expenses increased from $853,111 in the first
quarter of 1994 to $1,066,375 in the first quarter of 1995, reflecting the
Company's continuing commitment to developing new and improved medical products
for use by the medical profession and the public. As a percentage of net sales,
this expense has remained consistent at 5.0% in the first three months of 1994
and 1995. Diversification into other facets of medical devices through use of
new technology remains a goal of the Company. R & D expenses are expected to
increase throughout 1995 as the Company is also increasing research and
development overseas due to the FDA backlog on approval of new devices in the
United States.
Interest expense increased for the first three months of 1995 in
comparison with interest expense for the same period of 1994. This was primarily
due to the increase in the outstanding balance of the Company's international
line of credit.
The Company continues to incur increased costs related to obtaining FDA
and European Economic Community approvals for the Company's products. The
Company is continuing to address FDA regulations related to pre-market approval
of silicone mammary implants, and anticipates ongoing investment of employee
hours and Company funds to facilitate compliance with all FDA regulations as
determined by PMA studies and any new regulations which may be adopted. The FDA
is expected to issue a call for PMA applications for saline-filled breast
implants in 1998. The Company has agreed to conduct clinical trials and is
collecting data in anticipation of FDA action.
The Company has maintained steady growth in sales in both its domestic
and international market areas. Management anticipates strong market growth,
continued increases in production capacity domestically and internationally, and
expansion of the international sales force will contribute to a trend of sales
growth to continue throughout 1995.
<PAGE>
PART II. OTHER INFORMATION
Items 1. through 5.
Not Applicable
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
None
<PAGE>
INAMED CORPORATION
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
INAMED CORPORATION
By
Michael D. Farney
Chief Executive Officer and
Chief Financial Officer
Dated: May 12, 1995
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JAN-01-1995
<PERIOD-END> MAR-31-1995
<CASH> 0
<SECURITIES> 0
<RECEIVABLES> 19,815,236
<ALLOWANCES> (6,029,852)
<INVENTORY> 16,844,552
<CURRENT-ASSETS> 35,988,127
<PP&E> 17,193,077
<DEPRECIATION> (7,466,333)
<TOTAL-ASSETS> 51,198,597
<CURRENT-LIABILITIES> 34,314,145
<BONDS> 0
<COMMON> 9,858,507
0
0
<OTHER-SE> (3,405,999)
<TOTAL-LIABILITY-AND-EQUITY> 51,198,597
<SALES> 21,744,875
<TOTAL-REVENUES> 21,744,875
<CGS> 6,334,312
<TOTAL-COSTS> 20,390,368
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 128,743
<INCOME-PRETAX> 1,965,365
<INCOME-TAX> 824,869
<INCOME-CONTINUING> 1,140,496
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,140,496
<EPS-PRIMARY> .15
<EPS-DILUTED> .15
</TABLE>
