SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended April 25, 1998 Commission File Number 2-37706
Bowles Fluidics Corporation
(exact name of registrant as specified in its charter)
MARYLAND 52-0741762
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
6625 Dobbin Road, Columbia, Maryland 21045
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (410) 381-0400
Indicate by check mark whether the registrant has filed all annual, quarterly
and other reports required to be filed with the Commission within the past 90
days and in addition has filed the most recent annual report required to be
filed.
Yes X No
--- ---
Indicate the number of shares outstanding of each issuer's classes of common
stock, as of April 25, 1998.
Class Outstanding at April 25, 1998
------------------ -----------------------------
Common Stock, $.10 12,640,011 shares
<PAGE>
INDEX
BOWLES FLUIDICS CORPORATION
FOR THE SIX MONTHS ENDED APRIL 25, 1998
Page
PART I. Financial Information Number
------
Item 1. Financial Statements
Consolidated Statements of Income
For the three and six months ended
April 25, 1998, and April 26, 1997 ...................... 3
Consolidated Balance Sheets
April 25, 1998, and October 25, 1997 .................... 4
Consolidated Statements of Cash Flows
For the six months ended
April 25, 1998, and April 26, 1997 ...................... 5
Notes to Consolidated Financial Statements ................. 6
Item 2. Management's Discussion and Analysis
of Results of Operations and Financial
Condition................................................. 8
PART II. Other Information
Item 6. Exhibits and Reports on Form 8-K ...........................11
Exhibit 20 ..........................................12
Form 8-K ............................................14
2
<PAGE>
BOWLES FLUIDICS CORPORATION
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
<TABLE>
<CAPTION>
For the Three Months Ended For the Six Months Ended
-------------------------- ------------------------
April 25, April 26, April 25, April 26,
1998 1997 1998 1997
--------- --------- --------- ---------
<S><C>
Net sales $ 5,669,190 $ 4,983,272 $10,472,861 $ 9,227,395
Cost of sales 4,011,008 3,037,098 7,306,394 6,195,179
---------- ---------- ---------- ----------
Gross profit 1,658,182 1,946,174 3,166,467 3,032,216
Selling, general and
administrative expenses 708,367 896,487 1,329,115 1,737,469
Research and development costs 196,597 256,747 377,563 531,508
---------- ---------- ---------- ----------
Operating income 753,218 792,940 1,459,789 763,239
Interest income 12,787 25,273 40,888 51,258
Other income (expense), net 9,929 7,032 14,327 (1,919)
---------- ---------- ---------- ----------
Income before taxes 775,934 825,245 1,515,004 812,578
Provision for income taxes 289,172 307,174 560,390 292,342
---------- ---------- ---------- ----------
Net income 486,762 518,071 954,614 520,236
Preferred stock
dividends accrued (18,662) (18,662) (37,323) (37,323)
---------- ---------- ---------- ----------
Income applicable to
common shareholders $ 468,100 $ 499,409 $ 917,291 $ 482,913
========== ========== ========== ==========
Basic earnings per share $ .04 $ .04 $ .07 $ .04
========== ========== ========== ==========
Diluted earnings per share $ .03 $ .03 $ .06 $ .03
========== ========== ========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
3
<PAGE>
BOWLES FLUIDICS CORPORATION
CONSOLIDATED BALANCE SHEETS
(Unaudited) (Audited)
April 25, October 25,
1998 1997
----------- -----------
ASSETS
Current
Cash and cash equivalents $ 41,736 $ 755,525
Investments available for sale 495,968 1,563,121
Accounts receivable 3,749,214 3,112,063
Inventories 3,076,403 2,130,615
Other current assets 432,116 634,037
----------- -----------
Total current assets 7,795,437 8,195,361
----------- -----------
Property and equipment, net 4,196,946 3,494,335
Other assets 92,323 95,005
----------- -----------
Total assets $12,084,706 $11,784,701
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current
Accounts payable - trade $ 1,035,950 $ 1,122,437
Accrued expenses and other liabilities 1,079,561 1,609,807
Income taxes payable 58,078 48,162
----------- -----------
Total current liabilities 2,173,589 2,780,406
Other liabilities 480,612 492,866
----------- -----------
Total liabilities $ 2,654,201 $ 3,273,272
----------- -----------
Commitments and contingencies
Stockholders' Equity
8% Convertible preferred stock 933,080 933,080
Common stock 1,264,001 1,264,001
Additional paid-in capital 2,728,083 2,728,083
Retained earnings 4,505,341 3,586,265
----------- -----------
Total stockholders' equity 9,430,505 8,511,429
----------- -----------
Total liabilities and stockholders' equity $12,084,706 $11,784,701
=========== ===========
The accompanying notes are an integral part of these financial statements.
4
<PAGE>
BOWLES FLUIDICS CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
For the Six Months Ended
------------------------
April 25, April 26,
1998 1997
----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 954,614 $ 520,236
Adjustments to reconcile net income
provided by operating activities:
Depreciation and amortization 526,804 448,238
Net loss on disposal of assets 2,675 2,450
Accretion of interest on investments (25,139) (16,668)
----------- -----------
1,458,954 954,256
----------- -----------
Change in operating accounts:
Accounts receivable (637,151) (661,326)
Inventories (945,788) 216,942
Other assets 201,244 72,395
Accounts payable (86,487) (284,990)
Accrued expenses and other liabilities (492,923) (115,818)
Income taxes payable 9,916 79,872
----------- -----------
Change in operating accounts (1,951,189) (692,925)
----------- -----------
Net cash provided (used) by operating activities (492,235) 261,331
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (1,237,729) (431,341)
Proceeds from sale of equipment -- 425
Proceeds from sale of investments 1,090,821 --
----------- -----------
Net cash used in investing activities (146,908) (430,916)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Preferred stock dividend (74,646) (74,646)
Proceeds from issuance of common stock -- 4,500
----------- -----------
Net cash used in financing activities (74,646) (70,146)
----------- -----------
Net decrease in cash and cash
equivalents (713,789) (239,731)
CASH AND CASH EQUIVALENTS
- Beginning of period 755,525 1,287,110
----------- -----------
- End of period $ 41,736 $ 1,047,379
=========== ===========
The accompanying notes are an integral part of these financial statements.
5
<PAGE>
BOWLES FLUIDICS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - GENERAL
In the opinion of the Company, the accompanying unaudited financial
statements contain all adjustments (consisting of only normal recurring
adjustments) necessary to present fairly the financial position as of April 25,
1998, and the results of operations and cash flows for three and six months
ended April 25, 1998, and April 26, 1997.
While the Company believes that the disclosures presented are adequate to
make the information not misleading, it is suggested that these financial
statements be read in conjunction with the financial statements and the notes
included in the Company's latest annual report on Form 10-K.
The Company considers itself as one operating segment due to the similarity
of its products, services, production processes, customers and distribution.
NOTE 2 - INVENTORIES
Inventories are comprised of:
April 25, October 25,
1998 1997
---------- ----------
Raw Material $ 653,684 $ 620,567
Work and tooling in process 1,377,944 1,016,845
Finished Goods 1,044,775 493,203
---------- ----------
Total $3,076,403 $2,130,615
========== ==========
NOTE 3 - PROPERTY AND EQUIPMENT, AND ACCUMULATED DEPRECIATION
Property and Equipment, and Accumulated Depreciation are comprised of:
April 25, October 25,
1998 1997
------------ ------------
Production machinery and equipment $ 5,841,868 $ 4,946,390
Office furniture and equipment 2,447,349 2,321,844
Laboratory and machine shop equipment 1,502,390 1,428,516
Leasehold improvements 810,943 812,120
------------ ------------
Total property and equipment 10,602,550 9,508,870
Less accumulated depreciation (6,405,604) (6,014,535)
------------ ------------
Net property and equipment $ 4,196,946 $ 3,494,335
============ ============
NOTE 4 - QUASI-REORGANIZATION
Effective October 29, 1994, the Board of Directors approved a
quasi-reorganization which had the impact of eliminating the retained earnings
deficit of $2,407,467 as an adjustment to the additional paid-in capital.
6
<PAGE>
BOWLES FLUIDICS CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 5 - EARNINGS PER SHARE
Effective October 26, 1997, the Company adopted Statement of Financial
Accounting Standard No. 128, "Earnings per Share" ("SFAS 128"). SFAS 128
replaced the presentation of primary earnings per share (EPS) and fully diluted
EPS with a presentation of basic EPS and diluted EPS. Basic earnings per share
are based on the weighted average number of common shares outstanding during the
periods. Diluted earnings per share are based on the weighted average number of
common shares outstanding and potential dilution of securities that could share
in earnings.
The following table sets forth the computation of basic and diluted
earnings per share:
<TABLE>
<CAPTION>
For the Three Months Ended For the Six Months Ended
---------------------------- ----------------------------
April 25, April 26, April 25, April, 26,
1998 1997 1998 1997
------------ ------------ ------------ ------------
<S><C>
Numerator:
Net income numerator for basic
earnings per share - income available
to common shareholders $ 486,762 $ 518,071 $ 954,614 $ 520,236
Effect of dilutive securities:
Preferred Stock Dividends (18,662) (18,662) (37,323) (37,323)
------------ ------------ ------------ ------------
Numerator for diluted earnings per share
Income available to common shareholders
after assumed conversion $ 468,100 $ 499,409 $ 917,291 $ 482,913
------------ ------------ ------------ ------------
Denominator:
Denominator for basic earnings per share:
Weighted average shares outstanding
during the period 12,640,011 12,640,011 12,640,011 12,627,511
Effect of dilutive securities:
Employee Stock Options 54,570 45,836 54,043 48,570
Assumed Conversion of Preferred Stock 3,732,320 3,732,320 3,732,320 3,732,320
------------ ------------ ------------ ------------
Denominator for diluted earnings per share 16,426,901 16,418,167 16,426,374 16,408,401
------------ ------------ ------------ ------------
Earnings per Share:
Basic $ .04 $ .04 $ .08 $ .04
============ ============ ============ ============
Diluted $ .03 $ .03 $ .06 $ .03
============ ============ ============ ============
</TABLE>
7
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION
The following discussion should be read in conjunction with the attached
financial statements and notes thereto, and with the Company's audited financial
statements and notes thereto for the fiscal year ended October 25, 1997. The
Company considers itself as one operating segment due to the similarity of its
products, services, production processes, customers and distribution.
RESULTS OF OPERATIONS
- ---------------------
Second Quarter FY 1998 Compared with Second Quarter FY 1997
- -----------------------------------------------------------
The Company's sales reached an all-time quarterly record in the second quarter
of fiscal year 1998 principally due to the billing of customer tooling. Net
income, however, fell short of last year's second quarter results because of
additional manufacturing costs this year and the lack of last year's customer
reimbursement of certain application engineering expenses. Net sales in the
second quarter of fiscal year 1998 rose to $5,669,190, 14% above last year's
second quarter sales of $4,983,272. Net income was $486,762, 6% or $31,309 below
the prior year's second quarter results of $518,071.
Sales of light vehicle windshield washer nozzles and defroster outlets of
$5,001,362 were 2.5% above the FY 1997 second quarter sales of $4,878,833 due to
increased market penetration in North America. Billings of $667,828 for
prototype and production tooling for future washer nozzle manufacturing
increased more than six times over the prior year's second quarter sales related
to the start-up of various new vehicle model programs.
Gross profit in the fiscal year 1998 second quarter was $1,658,182, 29% of total
sales. This compares with $1,946,174 in last fiscal year's second quarter at 39%
of total sales, reflecting a 15% decrease in profit. Manufacturing costs were
higher in this year's second quarter related to the start-up of new products and
a decrease in production efficiency. In addition, in the prior year's second
quarter a portion of the engineering and design costs for the new air
conditioning outlets were reimbursed by the customer.
Selling, general and administrative expenses of $708,367 for the fiscal year
1998 second quarter were 21% lower than those for the prior fiscal year's second
quarter due to the elimination of the sales commissions for manufacturer's
representatives and their replacement with the cost of the Company's own sales
force in the Detroit area. Research and development costs at 3.5% of total sales
were $196,597, 23% below last year's second quarter as the spending on certain
product development projects was discontinued or reduced.
Operating income decreased $39,722 or 5% to $753,218 in this fiscal year's
second quarter compared to $792,940 in last year's comparable period.
8
<PAGE>
Interest income declined 49% from the prior year's second quarter due to lower
cash and cash equivalent balances in this year's second quarter.
Provision for income taxes, both federal and state, was determined based upon an
estimate of the total year's pretax income. The effective tax rates for both
years' second quarters were essentially the same.
Six Months Ended April 25, 1998, Compared with Six Months Ended April 26, 1997
- ------------------------------------------------------------------------------
For the first six months of the fiscal year 1998, net sales rose due to
increased product deliveries as well as tooling billings, and net income also
improved because of lower selling, general and administrative expenses, and
research and development costs.
Net sales for the fiscal year 1998 first six months were $10,472,861, 13% above
the sales of last year's comparable period of $9,227,395. Net income was
$954,614, 83% or $434,378 more than the prior year's first six months of
$520,236.
Sales of light vehicle washer and defroster nozzles of $9,336,039 increased 4%
in the first six months compared with $8,940,183 in the same period of the prior
year. The gain was provided primarily by new washer nozzle shipments for foreign
automotive companies manufacturing in the United States. Future production
tooling sales increased $849,610 to $1,136,822 from last year's first six month
sales of $287,212 related to the start-up of various new vehicle model programs.
Gross profit for the first six months of fiscal year 1998 was 30% of net sales
at $3,166,467 compared with 33% of net sales for the prior year's comparable
period at $3,032,216. The gross profit increased as a result of the higher
washer nozzle sales. The profit margin decreased due to the lack of last year's
reimbursement from a customer for a portion of the engineering and design costs
for the new air conditioning outlets.
Selling, general and administrative expenses were $1,329,115 in the first six
months of fiscal year 1998, 24% lower than in the similar 1997 period due to the
elimination of the sales commissions for manufacturer's representatives and
their replacement with the cost of the Company's own sales force in the Detroit
area. Research and development costs at 3.6% of net sales were 29% less than the
prior year's comparable period as the spending on certain product development
projects was discontinued or reduced.
Operating income was $1,459,789 in the first six months of the fiscal year 1998
compared with $763,239 in the similar period last year, a 91% improvement.
Provision for income taxes, both federal and state, was determined based upon an
estimate of the total year's pretax income. The effective tax rates for both
years' six months were essentially the same.
9
<PAGE>
FINANCIAL CONDITION
- -------------------
The Company's working capital of $5,621,848 at April 25, 1998, increased
$206,893 or 4% from the previous fiscal year end at October 25, 1997. The
current ratio increased from 2.95 at the year end to 3.59 at the end of this
six-month period. Cash and cash equivalents as well as investments available for
sale decreased significantly, but both inventories and accounts receivable
increased and accrued expenses were paid down.
Cash used by operating activities was $492,235 in the first six months of fiscal
year 1998 compared with cash provided by operating activities of $261,331 in
last year's comparable period. This fiscal year the cash flow from net income
and depreciation was significantly higher, but large investments were made in
inventories, in both finished goods and tooling in process, and accounts
receivable increased as a result of higher sales. In addition, accrued expenses
were reduced principally for the payment of sales commissions related to the
termination of the Company's sales agreement with its manufacturer's
representatives. The final payment for these sales commissions was made in May
1998. Finished goods were increased in order to provide safety stock to ensure
future on-time delivery. A large portion of the tooling in process is for the
manufacture of the new air conditioning outlets. The billings are expected to be
approved and the cash receipts received for these tools later in the calendar
year 1998.
Capital expenditures were $1,237,729 in this fiscal year's first six months,
$806,388 greater than last year's similar period principally for an increase in
production capacity and additional tooling. Expenditures for fiscal year 1998
are expected to exceed significantly the spending in the prior fiscal year.
North American vehicle production increased 2% in the first calendar quarter of
1998 versus the same period in 1997. Production for the second quarter of 1998
is forecasted by Ward's Automotive Reports to increase 1% over last year's
second quarter.
The Company's management believes that the present and planned production
capacity should be satisfactory to meet the anticipated demands of the Company's
share of the North American vehicle production forecast, as well as near-term
new product shipments. Cash flow from operations and available cash are expected
to provide the funds needed for planned working capital requirements and capital
expenditures.
In order to perform the required electronic communication with its customers,
control production and other business functions, and receive product and
services from its suppliers, the Company needs to ensure that its own computer
systems and those of its suppliers will function properly for the year 2000 and
beyond. The Company has taken the necessary steps for its own computer systems
which are now compliant with these requirements. It continues to be in the
process of assessing the status of its production equipment and its suppliers.
The costs of compliance have not been and are not expected to be significant to
its results of operations.
Forward-Looking Statements
- --------------------------
This report contains certain forward-looking statements subject to risk and
uncertainties which could cause actual results to differ materially from those
anticipated. Readers are cautioned not to place undue reliance on those
forward-looking statements which speak only as of the date of this report.
10
<PAGE>
BOWLES FLUIDICS CORPORATION
PART II. OTHER INFORMATION
FOR THE SIX MONTHS ENDED APRIL 25, 1998
Item 6. Exhibits and Reports on Form 8-K
Exhibit Description
------- -----------
(a) Exhibit 20 Report furnished to Security Holders
(b) Reports on Form 8-K
11
<PAGE>
Exhibit 20
BOWLES FLUIDICS CORPORATION
6625 Dobbin Road, Columbia, Maryland 21045-4707 USA
Phone: 410-381-0400 Fax: 410-381-2718
June 9, 1998
TO THE STOCKHOLDERS OF BOWLES FLUIDICS CORPORATION:
Two factors allowed total sales to reach a new high:
o Increase in tooling billing.
o Increased market penetration for our automotive products in North
America.
Our continuous planned efforts devoted to new product development, particularly
the air outlets, have negatively affected our profit as could be expected.
During this quarter we have reorganized our product development activity
following team concepts in order to promote faster and more complete information
flow among the functional groups. We are seeking cost reduction by revamping our
manufacturing process to be cellular and have three products planned for its
use.
Sincerely,
Ronald Stouffer
President
RS:lto
Attachment
12
<PAGE>
EXHIBIT 20
BOWLES FLUIDICS CORPORATION
- --------------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
April 25, April 26, April 25, April 26,
1998 1997 1998 1997
----------- ----------- ----------- -----------
<S><C>
Net Sales $ 5,669,190 $ 4,983,272 $10,472,861 $ 9,227,395
Cost of Sales 4,011,008 3,037,098 7,306,394 6,195,179
Selling, General and Administrative Expenses 708,367 896,487 1,329,115 1,737,469
Research and Development Costs 196,597 256,747 377,563 531,508
Interest Income and Other Income and (Expense), Net 22,716 32,305 55,215 49,339
----------- ----------- ----------- -----------
Income before Taxes $ 775,934 $ 825,245 $ 1,515,004 $ 812,578
Provision for Income Taxes 289,172 307,174 560,390 292,342
----------- ----------- ----------- -----------
Net Income $ 486,762 $ 518,071 $ 954,614 $ 520,236
----------- ----------- ----------- -----------
Income applicable to Common Shareholders $ 468,100 $ 499,409 $ 917,291 $ 482,913
=========== =========== =========== ===========
Net Income per Share
Basic $ 0.04 $ 0.04 $ 0.07 $ 0.04
Diluted $ 0.03 $ 0.03 $ 0.06 $ 0.03
</TABLE>
- --------------------------------------------------------------------------------
CONSOLIDATED BALANCE SHEETS
Unaudited Audited
April 25, 1998 October 25,1997
-------------- ---------------
ASSETS
Cash and Cash Equivalents $ 41,736 $ 755,525
Investments 495,968 1,563,121
Accounts Receivable 3,749,214 3,112,063
Inventories 3,076,403 2,130,615
Other Current Assets 432,116 634,037
----------- -----------
Total Current Assets 7,795,437 8,195,361
Property, Plant and Equipment, Net 4,196,946 3,494,335
Other Assets 92,323 95,005
----------- -----------
Total Assets $12,084,706 $11,784,701
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts Payable--Trade $ 1,035,950 $ 1,122,437
Accrued Expenses and Other Liabilities 1,079,561 1,609,807
Income Taxes Payable 58,078 48,162
----------- -----------
Total Current Liabilities 2,173,589 2,780,406
Other Liabilities 480,612 492,866
----------- -----------
Total Liabilities 2,654,201 3,273,272
----------- -----------
8% Convertible Preferred Stock 933,080 933,080
Common Stock 1,264,001 1,264,001
Additional Paid-in Capital 2,728,083 2,728,083
Retained Earnings 4,505,341 3,586,265
----------- -----------
Stockholders' Equity 9,430,505 8,511,429
----------- -----------
Total Liabilities and Stockholders'
Equity $12,084,706 $11,784,701
=========== ===========
13
<PAGE>
BOWLES FLUIDICS CORPORATION
PART II. OTHER INFORMATION
Item 6. (b) Reports on Form 8-K
April 21, 1998
An Annual Meeting of Stockholders of Bowles Fluidics Corporation was held
on March 12, 1998.
1. The following Board of Directors was elected:
William Ewing III
Ronald D. Stouffer
John E. Searle, Jr.
David C. Dressler
Eric W. Koehler
2. Also at the meeting of stockholders, Coopers & Lybrand L.L.P. was appointed
as the Corporation's certified public accountants.
3. At a directors' meeting immediately following the meeting of stockholders,
the following officers were elected:
Chairman of the Board William Ewing III
President Ronald D. Stouffer
Executive Vice President Eric W. Koehler
Vice President, Administration, & Secretary Eleanor M. Kupris
Vice President, Engineering Richard W. Hess
Vice President, Finance David A. Quinn
Vice President, Quality Assurance Dharapuram N. Srinath
Vice President, Operations Melvyn J.L. Clough
Corporate Controller Arlene M. Hardy
4. In the category of Other Events, it is wished to report an error in the
Proxy Statement issued in conjunction with the Annual Meeting of
Stockholders held on March 12, 1998.
The Proxy Statement failed to report three Trusts as the following holders
of at least 5% of the Company's stock.
Jessie E. Phillips
Common Shares 1,181,324 9.4%
Preferred Shares 232,985 25.0%
Grace Ewing Huffman
Common Shares 1,181,324 9.4%
Preferred Shares 232,985 25.0%
Estate of Maria Taylor Ewing
Common Shares 3,831,014 30.4%
Preferred Shares 382,554 40.9%
14
<PAGE>
FORM 10-Q
BOWLES FLUIDICS CORPORATION
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.
BOWLES FLUIDICS CORPORATION
Date ___________________ By ___________________________
Ronald D. Stouffer
President
Date ___________________ By ___________________________
David A. Quinn
Vice President-Finance
15
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> OCT-31-1998
<PERIOD-END> APR-25-1998
<CASH> 41,736
<SECURITIES> 495,968
<RECEIVABLES> 3,749,214
<ALLOWANCES> 0
<INVENTORY> 3,076,403
<CURRENT-ASSETS> 7,795,437
<PP&E> 10,602,550
<DEPRECIATION> 6,405,604
<TOTAL-ASSETS> 12,084,706
<CURRENT-LIABILITIES> 2,173,589
<BONDS> 0
0
933,080
<COMMON> 1,264,001
<OTHER-SE> 7,233,424
<TOTAL-LIABILITY-AND-EQUITY> 12,084,706
<SALES> 5,669,190
<TOTAL-REVENUES> 5,669,190
<CGS> 4,011,008
<TOTAL-COSTS> 4,915,972
<OTHER-EXPENSES> (22,716)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 775,934
<INCOME-TAX> 289,172
<INCOME-CONTINUING> 486,762
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 486,762
<EPS-PRIMARY> 0.04
<EPS-DILUTED> 0.03
</TABLE>
