<PAGE>
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 1994
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ...... to ......
Registrant, State of Incorporation,
Address and Telephone Number
-----------------------------
GRC INTERNATIONAL, INC.
(A DELAWARE CORPORATION)
1900 GALLOWS ROAD
VIENNA, VIRGINIA 22182
(703) 506-5000
Commission I.R.S. Employer
File No. Identification No.
---------- ------------------
1-7517 95-2131929
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.
Outstanding at
Class of Common Stock January 31, 1995
--------------------- ----------------
$.10 PAR VALUE 8,989,295 shares
===============================================================================
<PAGE>
CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
PART I - FINANCIAL INFORMATION
A. FINANCIAL STATEMENTS
Consolidated Condensed Statements of Income 3
Consolidated Condensed Balance Sheets 4-5
Consolidated Condensed Statements of Cash Flows 6-7
Notes to Consolidated Condensed Financial Statements 8-9
B. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS 10-11
C. PART II - OTHER INFORMATION 12
</TABLE>
NOTE: The consolidated condensed financial statements included herein have been
prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations although the Company believes that the disclosures are
adequate to make the information presented not misleading.
It is suggested that these consolidated condensed financial statements be
read in conjunction with the consolidated financial statements and the
notes thereto included in the Company's latest annual report on Form 10-K.
2
<PAGE>
GRC INTERNATIONAL, INC. AND SUBSIDIARIES
----------------------------------------
CONSOLIDATED STATEMENTS OF INCOME
---------------------------------
(IN THOUSANDS, EXCEPT FOR PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
DECEMBER 31, DECEMBER 31,
----------- ------------
1994 1993 1994 1993
---- ---- ---- ----
<S> <C> <C> <C> <C>
REVENUES $29,813 $31,545 $61,307 $62,325
Cost of revenues 23,689 25,527 49,120 50,064
------- ------- ------- -------
GROSS MARGIN 6,124 6,018 12,187 12,261
General, administrative, marketing,
research and development expenses 4,938 4,085 9,474 8,636
Provision for losses 283 372 458 567
------- ------- ------- -------
OPERATING INCOME 903 1,561 2,255 3,058
Interest income (61) (121) (221) (289)
Interest expense 34 89 39 177
------- ------- ------- -------
INCOME BEFORE INCOME TAXES AND
CUMULATIVE EFFECT OF ACCOUNTING
CHANGE 930 1,593 2,437 3,170
Provision for income taxes --- 73 --- 165
------- ------- ------- -------
INCOME BEFORE CUMULATIVE EFFECT OF
ACCOUNTING CHANGE 930 1,520 2,437 3,005
Cumulative effect of accounting change --- --- --- 1,000
------- ------- ------- -------
NET INCOME $ 930 $ 1,520 $ 2,437 $ 4,005
======= ======= ======= =======
INCOME PER COMMON AND COMMON
EQUIVALENT SHARE:
Before cumulative effect of accounting change $.10 $.16 $.26 $ .32
From cumulative effect of accounting change --- --- --- .11
======= ======= ======= =======
$.10 $.16 $.26 $ .43
======= ======= ======= =======
WEIGHTED AVERAGE NUMBER OF COMMON
AND COMMON EQUIVALENT SHARES 9,401 9,385 9,410 9,364
======= ======= ======= =======
</TABLE>
The accompanying notes are an integral part of these statements.
3
<PAGE>
GRC INTERNATIONAL, INC. AND SUBSIDIARIES
----------------------------------------
CONSOLIDATED CONDENSED BALANCE SHEETS
-------------------------------------
(UNAUDITED)
<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30,
1994 1994
------------ --------
(IN THOUSANDS)
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 152 $ 3,660
Accounts receivable 29,752 29,403
Unbilled reimbursable costs and fees 12,098 8,366
Inventories, at lower of cost or market 1,632 1,185
Prepaid expenses and other 4,727 4,950
------- -------
Total current assets 48,361 47,564
------- -------
PROPERTY AND EQUIPMENT,
at cost, net of accumulated depreciation
and amortization of $9,317 and $9,641 13,086 12,344
------- -------
OTHER ASSETS:
Goodwill and other intangible assets, net 2,721 2,799
Other 8,658 6,373
------- -------
Total other assets 11,379 9,172
------- -------
$72,826 $69,080
======= =======
</TABLE>
The accompanying notes are an integral part of these balance sheets.
4
<PAGE>
GRC INTERNATIONAL, INC. AND SUBSIDIARIES
----------------------------------------
CONSOLIDATED CONDENSED BALANCE SHEETS
-------------------------------------
(UNAUDITED)
<TABLE>
<CAPTION>
DECEMBER 31, JUNE 30,
1994 1994
------------- ---------
(IN THOUSANDS)
<S> <C> <C>
CURRENT LIABILITIES:
Current portion of long-term debt
and capital leases $ 68 $ 93
Accounts payable 4,630 5,042
Accrued wages and benefits 9,155 8,988
Accrued expenses and other 6,549 8,380
-------- --------
Total current liabilities 20,402 22,503
-------- --------
LONG-TERM DEBT 5,490 ---
-------- --------
OTHER NON-CURRENT LIABILITIES 1,488 1,537
-------- --------
STOCKHOLDERS' EQUITY:
Common stock, $.10 par value -
Authorized - 30,000,000 shares
Issued - 9,274,000 shares
and 9,152,000 shares 927 915
Paid-in capital 76,588 76,363
Accumulated deficit (28,224) (30,661)
-------- --------
49,291 46,617
Less: Treasury stock, at cost; 300,000
shares and 142,500 shares (3,845) (1,577)
-------- --------
Total stockholders' equity 45,446 45,040
-------- --------
$ 72,826 $ 69,080
======== ========
</TABLE>
The accompanying notes are an integral part of these balance sheets.
5
<PAGE>
GRC INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
-----------------------------------------------
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
DECEMBER 31,
-----------------
1994 1993
------- -------
(IN THOUSANDS)
<S> <C> <C>
CASH FLOWS FROM OPERATIONS:
Net income $ 2,437 $ 4,005
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 1,552 1,264
Provisions for losses on accounts
receivable, and unbilled reimbursable costs
and fees 222 761
Cumulative effect of accounting change --- (1,000)
Changes in assets and liabilities:
Accounts receivable and unbilled
reimbursable costs and fees (4,303) 294
Inventory (447) 59
Other current assets 223 (355)
Accounts payable, accruals and
other current liabilities (1,273) (4,696)
Other, net (19) (211)
------- -------
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES (1,608) 121
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (2,052) (1,476)
Deferred software costs (2,188) (444)
Other, net (261) (195)
------- -------
NET CASH USED BY INVESTING ACTIVITIES (4,501) (2,115)
------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Purchase of Treasury stock (3,071) ---
New financing 5,490 ---
Payments on debt and capital lease obligations (55) (3,172)
Other, net 237 33
------- -------
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES 2,601 (3,139)
------- -------
DECREASE IN CASH & CASH EQUIVALENTS (3,508) (5,133)
CASH & CASH EQUIVALENTS AT BEGINNING OF PERIOD 3,660 10,069
------- -------
CASH & CASH EQUIVALENTS AT END OF PERIOD $ 152 $ 4,936
======= =======
</TABLE>
The accompanying notes are an integral part of these statements.
6
<PAGE>
GRC INTERNATIONAL, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
-----------------------------------------------
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
DECEMBER 31,
-----------------
1994 1993
------- -------
(IN THOUSANDS)
<S> <C> <C>
SUPPLEMENTAL DISCLOSURES:
Cash transactions:
Interest $ 12 $ 102
Income taxes 43 343
</TABLE>
The accompanying notes are an integral part of these statements.
7
<PAGE>
GRC INTERNATIONAL, INC. AND SUBSIDIARIES
----------------------------------------
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
----------------------------------------------------
DECEMBER 31, 1994 AND 1993
--------------------------
(UNAUDITED)
(1) The consolidated condensed financial statements included herein have
been prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain information
and footnote disclosures normally included in financial statements prepared
in accordance with generally accepted accounting principles have been
condensed or omitted pursuant to such rules and regulations. The results of
operations presented herein are not necessarily indicative of the results
to be expected for a full year. Although the Company believes that all
material adjustments (consisting only of normal recurring adjustments)
necessary for a fair presentation of the interim periods presented are
included and that the disclosures are adequate to make the information
presented not misleading, these consolidated condensed financial statements
should be read in conjunction with the consolidated financial statements
and notes thereto included in the Company's Annual Report on Form 10-K for
the fiscal year ended June 30, 1994.
(2) In December 1994, the Company announced that it had completed the
previously authorized repurchase of 300,000 shares of its common stock, at
a cost of $3,845,000, and that its Board of Directors authorized the
repurchase of up to 200,000 additional shares of its common stock in the
open market or in private transactions.
The timing and number of shares of the repurchase of the additional
200,000 shares of common stock will depend greatly on market conditions and
other factors. The shares will be purchased with existing cash, short-term
borrowings, future cash flows, or a combination of these factors, and may
be retired or used for general corporate purposes.
(3) Effective July 1, 1993, the Company adopted Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes" (SFAS 109).
The new statement supersedes the Company's previous accounting practice of
accounting for income taxes under Statement of Financial Accounting
Standards No. 96, "Accounting for Income Taxes" (SFAS 96). Both statements
require the use of the liability method of accounting for income taxes, but
the recognition of deferred tax assets was limited under SFAS 96. Under
SFAS 109, deferred tax assets and liabilities are determined based on the
difference between the financial statement and the tax basis of assets and
liabilities, using enacted tax rates in effect for the year which the
differences are expected to reverse. The change in the method of
accounting for income taxes from SFAS 96 to SFAS 109 resulted in a
cumulative effect adjustment to increase income by $1 million, or $.11 per
share, for the quarter ended September 30, 1993.
(4) In October 1993, the Company was served with a lawsuit filed in the
Superior Court of Orange County, California by ICN Biomedicals, Inc.
(Biomedicals) and its parent company, ICN Pharmaceuticals, Inc.
(Pharmaceuticals). The suit alleges fraud, negligent misrepresentation,
violations of state and federal securities laws and other claims against
the Company in connection with the sale of its biomedical business to
Biomedicals in 1989, and seeks to recover all monies paid and damages for
out-of-pocket losses, court costs and interest. The Court ordered ICN to
arbitrate its claims and stayed Court action pending completion of the
arbitration. As ordered by the Court, ICN filed for arbitration in New
York in March 1994, claiming damages in the approximate amount of $100
million plus unspecified punitive damages. In September 1994, the arbiters
dismissed those claims as time-barred. As a result of the Court action,
the Company reduced its reserves, for the quarter ended September 30, 1994,
by approximately $.2 million. In December 1994, the arbitration panel in
New York issued its final award on the numerous claims made against the
Company by ICN. The arbitration panel dismissed, with prejudice, the
claims and ordered ICN to pay the Company the
8
<PAGE>
remaining amounts due under the 1989 sale agreement, with interest, and to
pay the Company's legal expenses incurred in the proceedings.
Subsequent to December 31, 1994, the Company asked the California
court which ordered the arbitration to convert the arbiters award into a
court judgment. The Company also asked the California court to dismiss the
remaining claims of ICN Pharmaceuticals, Inc. In addition, the Company
received partial payment from ICN, as provided by the arbitration panel, in
the amount of approximately $.4 million. The Company is taking all needed
legal steps to assure for the full payment of the amount due under the 1989
sale agreement.
Management does not believe that these lawsuits have any merit and
is vigorously contesting them. As a result, management does not believe
that the ultimate outcome of these actions will have a material adverse
effect on the consolidated financial condition or results of operations of
the Company.
(5) In October and November 1993, the Company used approximately $3 million
of available cash and cash equivalents to retire the balance on the
mortgage associated with its California property.
9
<PAGE>
GRC INTERNATIONAL, INC. AND SUBSIDIARIES
----------------------------------------
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
---------------------------------------
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
---------------------------------------------
THREE MONTHS AND SIX MONTHS ENDED DECEMBER 31, 1994
---------------------------------------------------
(UNAUDITED)
The revenues and operating income and interest expense of the Company are
presented for the periods indicated:
<TABLE>
<CAPTION>
Percentage
Three Months Ended Six Months Ended Increase (Decrease)
9/30/94 9/30/93 12/31/94 12/31/93 Three Months Six Months
------- ------- -------- -------- ------------ ----------
<S> <C> <C> <C> <C> <C> <C>
Revenues $29,813 $31,545 $61,307 $62,325 (5.5)% (1.6)%
======= ======= ======= =======
Operating income $ 903 $ 1,561 $ 2,255 $ 3,058 (42.2)% (26.3)%
Interest (income)
expense, net (27) (32) (182) (112) (15.6)% 62.5%
------- ------- ------- -------
Income before income taxes
and cumulative effect of
accounting change 930 1,593 2,437 3,170 (41.6)% (23.1)%
Provision for income taxes --- 73 --- 165 (100.0)% (100.0)%
------- ------- ------- -------
Income before cumulative
effect of accounting change 930 1,520 2,437 3,005 (38.8)% (18.9)%
Cumulative effect of
accounting change --- --- --- 1,000 N/A (100.0)%
------- ------- ------- -------
Net income $ 930 $ 1,520 $ 2,437 $ 4,005 (38.8)% (39.2)%
======= ======= ======= =======
</TABLE>
RESULTS OF OPERATIONS
- - - ---------------------
Revenues were $29.8 million for the second quarter, compared with $31.5
million for the same quarter last year. The revenue decrease of $1.7 million,
or 5.5%, is attributable entirely to the Company's normal revenues (revenues
originating from the Company's services and products businesses) as subcontract
work (work performed by other organizations on subcontracts and included in the
Company's revenues) increased by approximately $1.0 million. Revenues were
$61.3 million for the first six months of fiscal 1995, compared with $62.3
million for the same period last year. The year-to-date decrease in revenues of
$1.0 million, or 1.6% is attributable entirely to the Company's normal revenues
as subcontract work increased by $2.6 million.
The $1.7 million reduction in the Company's normal revenues, for the second
quarter, is attributable to lower services revenues of $2.2 million and lower
product sales of $.5 million, off set by the increased subcontract work of $1.0
million. Service revenues are lower due primarily to temporary delays in the
government funding for contract services work already completed. In addition,
the Company is also experiencing delays in the government procurement process.
Since funding delays are temporary, the Company will report revenues on the
contract work already completed in subsequent periods. The shortfall in product
sales is primarily attributable to the Company's environmental software group
which has experienced lower than anticipated revenues from new license sales of
its health and environmental tracking software system. The year-to-date $1.0
million reduction in the Company's normal revenues is attributable to lower
services revenues of $2.6 million and lower product sales of $1.0 million, off
set by
10
<PAGE>
the increased subcontract work of $2.6 million. The reason for the lower
revenues in both the services and product areas is the same as described for the
second quarter.
A large percentage of the Company's revenues are derived from contracts
with the U.S. Department of Defense (DoD). Possible decreases or funding delays
in the DoD budget may negatively impact the Company's plans and ability to
achieve revenue growth. However, the Company believes that its contract base is
sufficiently diverse so that the cancellation of any one DoD program would not
have a material adverse effect on the Company. In addition, the Company also
believes that there are sufficient opportunities for other contract awards in
the DoD, NASA, other governmental agencies and the private sector to allow the
Company to sustain its revenue level or grow over time.
As of December 31, 1994, the value of the Company's backlog (without
options) exceeds one year's revenues, and the value of the total backlog (with
options) is approximately two and one-half years' revenues. The backlog
consists of approximately 185 active contracts which vary in the period of
performance from a few months to multi-year. The work to be performed on these
contracts involves the following: information technology; studies and analysis;
modeling and simulation; testing and evaluation; and proprietary products.
Operating income was $.9 million (3.0% of revenues) for the second quarter,
compared with $1.6 million (4.9% of revenues) for the same quarter last year.
The $.7 million decrease in operating income is attributable primarily to the
lower revenues and increased expenditures in marketing and development of the
Company's OSU(TM) network interface (Optical Service Unit). Operating income was
$2.3 million (3.7% of revenues) for the first six months of fiscal year 1995,
compared with $3.1 million (4.9% of revenues) for the same period last year. The
$.8 million decrease in year-to-date operating income is attributable primarily
to lower revenues and increased R&D expenditures.
The Company's net interest income is not significant for either the second
quarter or the year-to-date period.
Income taxes continue to be insignificant to the operating results, since
the Company has utilized its net operating loss carryforwards to shelter its
income from tax.
Effective July 1, 1993, the Company adopted Statement of Financial
Accounting Standards No. 109, "Accounting for Income Taxes" (SFAS 109). The new
statement superseded the Company's previous accounting practice of accounting
for income taxes under Statement of Financial Accounting Standards No. 96,
"Accounting for Income Taxes" (SFAS 96). As a result of adopting this change,
the Company recognized $1 million of income attributable to recording a net
deferred tax asset on its books during fiscal year 1994.
LIQUIDITY AND CAPITAL RESOURCES
- - - -------------------------------
The Company has been able to finance its operations from a combination of
internally generated working capital and borrowing against its available credit
facilities. Management believes that the Company has adequate revenues to
finance its current and future operations from existing or internally generated
working capital and available credit. The Company has a revolving credit
agreement which entitles it to borrow up to a maximum of $10 million at the
prime rate (8.5% as of December 31, 1994). As of December 31, 1994, the Company
has $.2 million of cash and cash equivalents and $4.5 million of the revolving
credit agreement available to support is working capital requirements.
As of December 31, 1994, the Company has borrowed $5.5 million to support its
operations as its accounts receivable and unbilled reimbursable costs have
increased due to temporary delays in government funding. These temporary
funding delays do not represent an uncertainty regarding the collectibility of
the receivables as it is a normal occurrence in the Company's services business.
During fiscal year 1995, the Company used $3.1 million in cash to complete
the repurchase program for its common stock. In total, the Company used $3.8
million in cash for the buyback program.
11
<PAGE>
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS.
- - - ---------------------------
In 1989, the Company sold its biomedical business to ICN Biomedicals, Inc.
("ICN Biomedicals") for $35.6 million in cash, $.5 million in an interest-
bearing note, and stock redeemable in 1994 for $2 million. In addition, the
Company was relieved of approximately $26 million of debt.
In October 1993, the Company was served with a lawsuit filed in the Superior
Court of Orange County, California by ICN Biomedicals, Inc. (Biomedicals) and
its parent company, ICN Pharmaceuticals, Inc. The suit alleges fraud, negligent
misrepresentation, violations of state and federal securities laws and other
claims against the Company in connection with the sale of its biomedical
business to Biomedicals in 1989, and seeks to recover all monies paid and
damages for out-of-pocket losses, court costs and interest. The Court ordered
Biomedicals to arbitrate its claims and stayed Court action pending completion
of the arbitration. As ordered by the Court, Biomedicals filed for arbitration
in New York in March 1994, claiming damages in the approximate amount of $100
million plus unspecified punitive damages. In September 1994, the arbiters
dismissed those claims as time-barred. As a result of the Court action, the
Company reduced its reserves, for the quarter ended September 30, 1994, by
approximately $.2 million. In December 1994, the arbitration panel in New York
issued its final award on the numerous claims made against the Company by
Biomedicals. The arbitration panel dismissed the claims with prejudice, and
ordered Biomedicals to pay the Company the remaining amounts due under the 1989
sale agreement, with interest, and to pay the Company's legal expenses incurred
in the proceedings.
Subsequent to December 31, 1994, the Company asked the California court which
ordered the arbitration to convert the arbiters award into a court judgment.
The Company also asked the California court to dismiss the remaining claims of
Pharmaceuticals. In addition, the Company received partial payment from
Biomedicals, as provided by the arbitration panel, in the amount of
approximately $.4 million. The Company is taking all needed legal steps to
assure for the full payment of the amount due under the 1989 sale agreement.
Management does not believe that this action has any merit and intends to
vigorously contest it. As a result, management does not believe that the
ultimate outcome of these action will have a material adverse effect on the
consolidated financial condition or results of operations of the Company.
Other information with respect to Item 1 is included in Part I, Item 3
("Legal Proceedings") on Page 5 of the Company's Annual Report to Shareholders
on Form 10-K for the fiscal year ended June 30, 1994, and in Note 5 to the
financial statements on Page 20 ("Contingencies") of its Annual Report to
shareholders for the same year.
ITEMS 2, 3, 4 AND 5 ARE INAPPLICABLE.
- - - -------------------------------------
ITEM 6(A) EXHIBITS.
- - - -------------------
None.
ITEM 6(B) - REPORTS ON FORM 8-K.
- - - --------------------------------
None.
12
<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.
GRC INTERNATIONAL, INC.
By: /s/ Jim Roth
-------------------------------------
Jim Roth
President and Chief Executive Officer
By: /s/ Philip R. Pietras
-------------------------------------
Philip R. Pietras
Treasurer and Chief Financial Officer
February 14, 1995
13
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1995
<PERIOD-START> JUL-01-1994
<PERIOD-END> DEC-31-1994
<CASH> 152
<SECURITIES> 0
<RECEIVABLES> 29,815
<ALLOWANCES> 63
<INVENTORY> 1,632
<CURRENT-ASSETS> 48,361
<PP&E> 22,403
<DEPRECIATION> 9,317
<TOTAL-ASSETS> 72,826
<CURRENT-LIABILITIES> 20,402
<BONDS> 0
<COMMON> 927
0
0
<OTHER-SE> 44,519
<TOTAL-LIABILITY-AND-EQUITY> 72,826
<SALES> 61,307
<TOTAL-REVENUES> 61,307
<CGS> 49,120
<TOTAL-COSTS> 49,120
<OTHER-EXPENSES> 9,474
<LOSS-PROVISION> 458
<INTEREST-EXPENSE> 182
<INCOME-PRETAX> 2,437
<INCOME-TAX> 0
<INCOME-CONTINUING> 2,437
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,437
<EPS-PRIMARY> 0.26
<EPS-DILUTED> 0.26
</TABLE>
