<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- ------ EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 30, 1997
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
- ------ EXCHANGE ACT OF 1934
For the Transition Period From _____ to _____
COMMISSION FILE NO. 0-18797
CHEMI-TROL CHEMICAL CO.
(Exact name of registrant as specified in its charter)
OHIO 34-4439286
(State or other jurisdiction of (IRS employer
incorporation or organization) Identification No.)
2776 CR 69, Gibsonburg, Ohio 43410
(Address of principal executive offices) (Zip Code)
(419) 665-2367
(Registrant's telephone number, including area code)
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
--- ---
The registrant has 2,004,930 common shares, no par value, outstanding as
of September 30, 1997.
This document contains 10 pages
<PAGE> 2
PART 1. FINANCIAL INFORMATION
Financial Statements
- --------------------
The accompanying condensed balance sheets as of September 30, 1997 and
1996, and related condensed statements of income and retained earnings and
statements of cash flows for the periods ended September 30, 1997 and 1996 are
unaudited but include all adjustments, consisting only of normal recurring
accruals, which the Company considers necessary for a fair presentation of
financial position and operating results. The accompanying condensed balance
sheet as of December 31, 1996 has been derived from the audited year end
financial statements. These financial statements presented are for interim
periods and do not include all disclosures normally provided in annual financial
statements; they should be read in conjunction with financial statements and
notes thereto appearing in the Company's 1996 annual report to shareholders. The
interim result of operations are not necessarily indicative of the results for
the complete year.
CHEMI-TROL CHEMICAL CO.
CONDENSED STATEMENTS OF INCOME AND RETAINED EARNINGS
<TABLE>
<CAPTION>
Three months ended Nine months ended
Sept. 30, 1997 Sept. 30, 1996 Sept. 30, 1997 Sept. 30, 1996
---------------------------------------------------------------------
<S> <C> <C> <C> <C>
Revenues:
Net sales $ 16,926,070 $ 18,829,069 $ 48,629,781 $ 46,639,125
Interest and financing income 175,535 214,538 638,213 712,690
---------------------------------------------------------------------
17,101,605 19,043,607 49,267,994 47,351,815
Costs and expenses:
Costs of sales 14,743,231 16,217,108 41,880,531 40,695,509
Selling expenses 814,100 800,021 2,224,793 2,423,111
General and admin. expenses 617,838 806,169 2,172,182 2,004,012
Interest 193,908 409,068 614,199 1,118,946
---------------------------------------------------------------------
16,369,077 18,232,366 46,891,705 46,241,578
---------------------------------------------------------------------
Income from continuing operations
before income taxes 732,528 811,241 2,376,289 1,110,237
Provision for income taxes 295,000 320,700 930,385 447,700
---------------------------------------------------------------------
Income from continuing operations 437,528 490,541 1,445,904 662,537
Discontinued operations (Note 4)
Income (loss) from discontinued
operations net of tax (5,052) (40,721) 53,780
----
Gain on disposal of division
net of tax ---- ---- 270,198 ----
---------------------------------------------------------------------
Income (loss) from discontinued
operations ---- (5,052) 229,477 53,780
---------------------------------------------------------------------
Net income 437,528 485,489 1,675,381 716,317
Retained earnings at beginning
of period 18,725,879 17,182,346 17,668,471 17,131,962
---------------------------------------------------------------------
19,163,407 17,667,835 19,343,852 17,848,279
Dividends declared 180,443 180,443 360,888 360,887
---------------------------------------------------------------------
Retained earnings at end of period $ 18,982,964 $ 17,487,392 $ 18,982,964 $ 17,487,392
=====================================================================
Income (loss) per common share
Continuing operations $ .22 $ .24 $ .72 $ .33
Discontinued operations (Nt. 4):
Income (loss) from operations ---- ---- (.02) .03
Gain on disposal of division ---- ---- .14 ----
---------------------------------------------------------------------
Net income per common share $ .22 $ .24 $ .84 $ .36
=====================================================================
</TABLE>
See accompanying notes.
2
<PAGE> 3
CHEMI-TROL CHEMICAL CO.
CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
September December September
30, 31, 30,
1997 1996 1996
------------------------------------------------
<S> <C> <C> <C>
ASSETS
Current assets:
Cash $ 186,178 $ 112,506 $ 81,987
Notes and accounts receivable 21,290,063 18,965,249 26,032,489
Net investment in sales-type leases 460,886 684,120 685,526
Inventories (Note 1) 8,281,142 8,861,127 9,900,143
Prepaid expenses and other assets 804,090 1,140,873 877,879
Current assets of discontinued operations (Note 4) ---- 2,346,175 2,816,026
------------------------------------------------
Total current assets 31,022,359 32,110,050 40,394,050
Property, plant and equipment, net 9,537,897 9,650,578 9,888,851
Investments and other assets 3,263,007 4,661,592 4,238,148
Property, plant and equipment of discontinued
operations (Note 4) ---- 1,001,147 1,021,355
------------------------------------------------
$ 43,823,263 $ 47,423,367 $ 55,542,404
================================================
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Notes payable $ 2,364,063 $ 2,964,916 $ 11,238,492
Accounts payable 6,536,964 7,359,161 6,924,258
Income taxes 85,173 230,485 263,685
Dividends payable ---- 180,444 -
Accrued liabilities 2,153,055 2,923,177 2,783,124
Long-term debt due within one year 2,990,978 7,300,679 4,158,983
------------------------------------------------
Total current liabilities 14,130,233 20,958,862 25,368,542
Long-term debt 4,547,968 3,329,267 7,201,703
Other long-term liabilities 695,331 ---- ----
Deferred federal income tax 876,000 876,000 894,000
Shareholders' equity:
Common stock, without par value;
6,000,000 shares authorized
2,004,930 shares issued and
outstanding (note 3) 4,590,767 4,590,767 4,590,767
Retained earnings 18,982,964 17,668,471 17,487,392
------------------------------------------------
Total shareholders' equity $ 23,573,731 $ 22,259,238 $ 22,078,159
------------------------------------------------
$ 43,823,263 $ 47,423,367 $ 55,542,404
================================================
</TABLE>
See accompanying notes.
3
<PAGE> 4
<TABLE>
<CAPTION>
CHEMI-TROL CHEMICAL CO.
STATEMENTS OF CASH FLOWS
Nine months ended September 30, 1997 and 1996
1997 1996
------------------- -------------------
<S> <C> <C>
OPERATING ACTIVITIES:
Income from continuing operations $ 1,445,904 $ 662,537
Adjustments to reconcile income from continuing operations
to net cash provided (used) by continuing operations:
Notes receivable from product sales (2,599,967) (2,511,904)
Notes receivable sold 1,353,116 1,614,971
Collections from customers on notes receivable 2,853,039 3,454,814
Proceeds from sales-type leases 974,113 1,423,759
Addition to net investment in sales-type leases (266,946) (165,702)
Depreciation 934,971 917,858
Increase in other long-term liabilities 695,331 ----
Gain on sale of property and equipment (41,712) (15,752)
Increase in allowance for doubtful accounts 85,000 75,000
Changes in operating assets and liabilities:
Accounts receivable (3,097,395) (10,829,621)
Inventories 579,982 165,357
Prepaid expenses 336,783 323,809
Other assets (3,554) (29,066)
Accounts payable (822,197) (178,245)
Income taxes payable (145,312) 115,056
Accrued liabilities (770,122) 240,000
-------------------- ------------------
Cash provided (used) by continuing operations 1,511,034 (4,737,129)
Cash provided (used) by discontinued operations (Note 4) 2,146,086 (479,787)
------------------- --------------------
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES 3,657,120 (5,216,916)
INVESTING ACTIVITIES:
Additions to property and equipment (832,785) (873,415)
Proceeds from disposals of property and equipment -
continuing operations 66,580 34,590
Net proceeds from sale of property, plant and equipment of
discontinued operations (Note 4) 1,415,942 ----
------------------- -------------------
NET CASH PROVIDED (USED) BY INVESTING ACTIVITIES 649,737 (838,825)
FINANCING ACTIVITIES:
Notes payable - net (600,853) 9,730,661
Payments of long-term debt (3,091,000) (4,292,901)
Proceed from long-term borrowings ---- 1,160,308
Dividend payments (541,332) (541,331)
-------------------- -------------------
NET CASH PROVIDED (USED) BY FINANCING ACTIVITIES (4,233,185) 6,056,737
-------------------- ------------------
Increase in cash 73,672 996
Cash at beginning of period 112,506 80,991
=================== ===================
Cash at end of period $ 186,178 $ 81,987
=================== ===================
Supplemental cash flow information:
Cash paid for interest $ 592,846 $ 1,149,755
=================== ===================
Cash paid for income taxes $ 1,228,312 $ 368,944
=================== ===================
</TABLE>
See accompanying notes.
4
<PAGE> 5
CHEMI-TROL CHEMICAL CO.
NOTES TO FINANCIAL STATEMENTS
1. Inventories
-----------
Inventories at September 30, 1997, December 31, 1996 and September 30,
1996 are as follows:
<TABLE>
<CAPTION>
September 30, 1997 December 31, 1996 September 30, 1996
------------------- ------------------ -------------------
<S> <C> <C> <C>
Manufacturing inventories:
Raw material and supplies $ 2,343,477 $ 2,584,509 $ 2,257,988
Work in process 405,999 438,662 505,247
Finished goods 1,007,537 1,188,521 1,436,063
Purchased inventory held for resale 3,924,170 4,296,911 4,908,521
Materials used in contracting 599,959 352,524 792,324
=================== ================== ===================
$ 8,281,142 $ 8,861,127 $ 9,900,143
=================== ================== ===================
</TABLE>
2. Sale of Notes With Recourse
---------------------------
The company at September 30, 1997 has a contingent liability
of $ 2,584,327 for customers' installment notes sold with recourse to
the Chemi-Trol Chemical Company Profit Sharing Plan. The credit risk
associated with these notes is minimal as the Company retains a
security interest in the products sold on the installment basis.
3. Net Income Per Common Share
----------------------------
Net income per common share is based on the weighted average
number of shares outstanding of 2,004,930. Shareholders' rights, which
may have a potentially dilutive effect, have been excluded from the
weighted average shares computation as conditions to the exercisability
of such rights have not been satisfied.
4. Discontinued Operations
------------------------
On March 25, 1997, Chemi-Trol Chemical Co. sold its Cory
Orchard and Turf Division to Terra International, Inc. "Terra" for
approximately $4.8 Million under an asset purchase agreement. The sale
resulted in a net gain of $270,198 after income taxes of $179,697.
Terra is a Delaware Corporation having an address of 600 Fourth Street,
PO Box 6000 Sioux City, IA 51202-6000. Summary operating results of the
discontinued Cory Orchard and Turf operations for the quarter and nine
months ended September 30th are as follows:
<TABLE>
<CAPTION>
Three months ended Nine months ended
---------------------------- ------------------------------
September September 30, September September
30, 1997 1996 30, 1997 30, 1996
============= =============== ============== ==============
<S> <C> <C> <C> <C>
Revenues $ ---- $ 1,617,822 $ 911,943 $ 5,096,497
============= =============== ============== ==============
Income (loss) before income taxes $ ---- $ (12,752) $ (67,803) $ 90,080
Income taxes (credit) $ ---- (7,700) (27,082) 36,300
============= =============== =============== =============
Net income (loss) $ ---- $ (5,052) $ (40,721) $ 53,780
============= =============== =============== =============
</TABLE>
Interest on borrowings under the company's general credit
facilities was allocated to discontinued operations based on the ratio
of net assets of the discontinued Cory Orchard and Turf operations to
the total net assets of the Company plus existing debt under the
company's general credit facilities. Interest expense allocated to
discontinued operations during the nine months ended September 30, 1997
was $18,567 and for the three months and the nine months ended
September 30, 1996 was $ 34,510 and $ 95,524, respectively.
5
<PAGE> 6
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Results of Operations
- ---------------------
Capsule segment results (in thousands) for the periods ended September
30, 1997 and 1996 are as follows:
<TABLE>
<CAPTION>
($ in 000's) Three months ended Nine months Ended
- ------------ September 30 September 30
--------------------------------------------------------------------
1997 1996 1997 1996
--------------------------------------------------------------------
Revenues (unaffiliated customers):
<S> <C> <C> <C> <C>
Tank $ 9,385 $ 9,167 $ 27,763 $ 22,472
Cal-Van Tools 3,331 4,410 11,128 13,358
Chemical 4,386 5,465 10,364 11,510
Corporate interest ---- 2 13 12
--------------------------------------------------------------------
Total revenues $ 17,102 $ 19,044 $ 49,268 $ 47,352
====================================================================
Operating profit:
Tank $ 1,089 $ 1,158 $ 3,599 $ 2,413
Cal-Van Tools (78) 131 72 338
Chemical 313 397 527 742
--------------------------------------------------------------------
Total operating profit 1,324 1,686 4,198 3,493
General corporate expenses (398) (468) (1,221) (1,276)
Corporate interest income ---- 2 13 12
Corporate interest expenses (194) (409) (614) (1,119)
--------------------------------------------------------------------
Income from continuing operations
before income taxes $ 732 $ 811 $ 2,376 $ 1,110
====================================================================
</TABLE>
Third quarter ended September 30, 1997 vs. third quarter ended September 30,
1996
- --------------------------------------------------------------------------------
The Company's third quarter revenues from continuing operations
decreased by 10.2% to $17,101,605 from $19,043,607 in the third quarter of last
year. Net income decreased by approximately 9.9% to $437,528, or 22 cents per
share, compared to $485,489 or 24 cents per share, in 1996.
The Tank Division, which accounted for 54.9% of total Company revenues,
recorded record sales for the third quarter, up 2.8% to $9,209,184 from the
prior year's record of $8,955,023. Cost of sales increased at the higher rate of
4.7% decreasing both gross margins and gross profit and resulted in a 5.9%
decrease in operating profit over prior year levels. The decrease in margins was
largely the result of sales discounts granted to customers in exchange for
prompt payment terms. The prompt payment terms reduced borrowings during the
quarter and were partially responsible for the drop in corporate interest
expenses from $409,068 in last year's third quarter to $193,908 in 1997. Tank
Division selling and general administrative expenses decreased by 24.5% during
the quarter.
During the third quarter ended September 30, 1997 the Chemical Group's
sales decreased by 19.7% over 1996 levels largely due to a decrease in pavement
marking operations where a change in product mix and the competitive nature of
bidding situations resulted in decreased sales. The Group's decrease in sales
was largely responsible for a 21.1% decrease in operating profit as gross profit
margins for the quarter were unchanged from the prior year. Selling and general
administrative expenses decreased by 16.2%.
6
<PAGE> 7
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
Cal-Van Tools third quarter sales decreased by 24.5% from the prior
year record levels. The decline in sales coupled with decreases in cost of sales
and selling and general administrative expenses, which decreased at the lessor
rates of 24.1% and 1.7%, respectively, resulted in operating profit decreasing
from $130,892 in the third quarter last year to an operating loss of $78,345 in
1997. The falloff in Cal-Van Tools sales results in part from a restructuring
and partial elimination of marginally profitable retail business. The Company
continues to move forward in its efforts to divest this division and concentrate
on its core businesses.
For the Company as a whole, net sales decreased by 10.1% while cost of
sales decreased at the lesser rate of 9.1%. Selling expenses for the quarter
increased by 1.8% and general and administrative expenses decreased by 23.4%.
The decrease in general and administrative expense was partially the result of
decreased profit sharing allocations at the lower profit level. Third quarter
interest expense decreased by 52.6% over prior year levels as the Company was
able to lower short-term working capital needs and decrease borrowings. Interest
and financing income decreased by 18.2% as the demand for financing in the
Company's Tank segment slowed. For the quarter, net income for the Company
decreased by 9.9% to $437,528, or 22 cents per share, from $485,489, or 24 cents
per share, in the prior year quarter.
First nine months of 1997 vs. first nine months of 1996
- -------------------------------------------------------
For the first nine months of 1997 revenues from continuing operations
totaled $49.3 million versus $47.4 million for the first nine months of 1996, an
increase of 4.0%. Net income increased to $1.7 million, or 84 cents per share,
including a gain of $270,198, or 14 cents per share, on disposal of a division,
versus $716,000 or 36 cents per share, a year earlier.
The Tank Division, which accounted for 56.4% of the Company's revenues
from continuing operations during the first nine months of 1997, increased net
sales by 24.6% to record levels of $27.1 million. Operating profit for the
segment increased by nearly 50% to a record $3.6 million from the prior year's
$2.4 million largely as a result of the increase in sales.
During the first nine months of 1997, Chemical Group revenues decreased
by 10.0%, while operating profits decreased by 28.9%, over the comparable period
in 1996. Competitive bidding in the Pavement Marking department of the Group's
Contract Division resulted in reduced margins and was largely responsible for
the falloff in operating profit.
Cal-Van Tools recorded net sales of $11.1 million in the first nine
months of 1997 down 16.7% from a record $13.4 million in 1996. Gross profit
margins were unchanged. The lower sales level, coupled with selling and general
administrative expenses which decreased at the lesser rate of 6.7%, resulted in
operating profit for the nine months decreasing to $72,165 from last year's
$338,367.
For the company as a whole, net sales from continuing operations
increased by 4.3%, while cost of sales increased at the lessor rate of 2.9%, and
together these changes combined to increase gross profit by 13.6%. Selling
expenses decreased by 8.2% over 1996 nine month levels. General and
administrative expenses increased by 8.4% largely a result of increased profit
sharing allocations at the higher profit level. During the first nine months of
1997 operations in leasing & finance slowed somewhat and resulted in a 10.5%
decrease in interest and financing income. Interest expense decreased sharply,
by 45.1%, as average borrowings for working capital needs of continuing
operations decreased during the first nine months of 1997. For the first nine
months of 1997 the Company recorded income from continuing operations of $1.446
million, or 72 cents per share, an increase of over 118% from 1996 income of
$662,537, or 33 cents per share. Current nine month income from discontinued
operations totaled
7
<PAGE> 8
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
$229,477, or 12 cents per share, and was comprised of $270,198 gain from the
disposal of the Cory Orchard & Turf Division and a nine month operating loss of
$40,721. This compares to a nine month income of $53,870, or 3 cents per share,
from discontinued operations in 1996. The Company's nine month net income for
1997 totaled $1.675 million, or 84 cents per share, compared to $716,317, or 36
cents per share, in the prior year.
Liquidity and Capital Resources
- -------------------------------
Liquidity is the measure of a company's ability to generate adequate
funds to meet its needs. Funds can be generated internally from operations or
externally by borrowing. Primary measures of liquidity include the amount of
working capital, the working capital ratio and the ability to borrow long-term
funds. As shown in the following chart (in thousands), the Company remains in a
strong position and its ability to borrow funds remains strong as evidenced by
the unused commitment for term financing and the unpledged notes and leases at
September 30, 1997.
<TABLE>
<CAPTION>
($ in 000's) September 30, December 31, September 30,
- ------------ 1997 1996 1996
----------------- --------------- ----------------
<S> <C> <C> <C>
Working capital $ 16,892 $ 11,151 $ 15,026
Working capital ratio 2.2 to 1 1.5 to 1 1.6 to 1
Unused commitment for term financing
of customer notes and leases 7,750 4,781 7,500
Unpledged notes and leases 2,060 1,407 473
</TABLE>
The working capital position of the Company has become stronger. At
September 30, 1997, working capital was $16,892,126. This is an increase of
$4,587,646 over working capital of $12,304,480 at June 30, 1997 and an increase
of $5,740,938 over working capital of $11,151,188 at December 31, 1996. The
current ratio of the Company at September 30,1997 was 2.2 to 1, up from 1.74 to
1 at June 30,1997. The strength of this ratio indicates that the Company is in a
strong position to meet its short-term obligations.
The Company's increase for the nine months in working capital was
largely provided from operations and the sale of the Cory Orchard & Turf
Operations. The Company did not increase long-term borrowings during the first
nine months to finance customers' installment notes receivable and sales type
leases of steel tanks produced by the Company's Tank Division. Outstanding
borrowings at September 30, 1997 amount to $3,419,450 to fund the customers'
installment notes receivable and $808,879 to fund the sales type leases. In
order to meet the anticipated needs of customers, the Company has an additional
$7.75 million available from lenders through May 2, 1998 to fund future
long-term financing for tank notes and leases extended to customers.
Due to the seasonal nature of the operations of the Company's Chemical
Group and the extension of payment terms in certain divisions, the Company has
an uneven cash flow pattern. Operations of the Chemical Group begin
approximately mid-April and run through November. There are substantial start-up
expenses for this division associated with inventory build-up and the purchase
of equipment and supplies. A large portion of these expenses fall due in the
period of May through July. Since the majority of the contracts performed by
this division are for political subdivisions and the contracts stretch over the
entire summer season, a high percentage of the payments are not received until
mid-September and October. This places the Company in a tight cash position from
June through October, occasionally
8
<PAGE> 9
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Continued)
making it necessary for the Company to borrow short-term funds. For this reason,
the Company has arranged a short-term borrowing line of credit of $15.75 million
through local banks. At September 30, 1997 the Company had short-term borrowings
of $2,364,063 under these lines of credit. Beginning in October, the Company
expects to have excess cash to begin repaying these short-term borrowings.
Part II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
----------------------------------------------------
(a) Annual meeting July 17, 1997
(b) R. J. Dudley, R. H. Moyer, and R. W. Woolf were elected
as directors for a term of three years and until their
successors are elected and qualified. A. B. Edelman was
elected for a term of one year and until his successor
is elected and qualified. The term of office as
directors F. J. Roynon and J. P. Simcox continues for
one more year and until their successors are elected and
qualified. The term of office as directors for A. F.
Doust, W. B. Lloyd, and Kevin D. Lauck continues for two
more years and until their successors are elected and
qualified.
(c) Each matter voted upon at the meeting and the shares
voted were as follows.
(1) On the proposal to elect R. J. Dudley, R. H.
Moyer, and R. W. Woolf as directors for a term of
three years and A. B. Edelman for a term of one
year, the votes for R. J. Dudley were 1,862,450,
with 7,816 votes withheld, for R. H. Moyer were
1,860,811, with 9,455 votes withheld, for R. W.
Woolf were 1,860,811, with 9,455 votes withheld,
and for A. B. Edelman were 1,864,843, with 2,223
votes withheld. *
(2) On the proposal to appoint Ernst & Young as the
independent auditors of the Company to audit the
books and accounts of the Company for the year
ended December 31, 1997, the number of shares
voted was 1,870,266; 1,863,752 shares were voted
in favor; 6108 shares were voted against; and 86
shares abstained. *
(3) A motion at the meeting to adopt a resolution to
ratify, approve and confirm the published annual
report of the President to the shareholders and
the acts of the Directors and Officers for the
past year was unanimously approved by shareholders
present.
* Approximately 93.3% of the outstanding shares were
represented at the meeting. Information on broker
non-votes has not been separately tabulated.
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibits.
(27) Financial Data Schedule
(b) Reports on Form 8-K None
9
<PAGE> 10
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.
CHEMI-TROL CHEMICAL CO.
/S/ KEVIN D. LAUCK
------------------
By: Kevin D. Lauck, Secretary/
Treasurer and Controller
(Chief Accounting Officer
also signing on behalf of
the registrant as duly
November 7, 1997 authorized officer)
10
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> SEP-30-1997
<EXCHANGE-RATE> 1
<CASH> 186,178
<SECURITIES> 0
<RECEIVABLES> 21,610,063
<ALLOWANCES> 320,000
<INVENTORY> 8,281,142
<CURRENT-ASSETS> 31,022,359
<PP&E> 20,080,559
<DEPRECIATION> 10,542,662
<TOTAL-ASSETS> 43,823,263
<CURRENT-LIABILITIES> 14,130,233
<BONDS> 7,538,946
0
0
<COMMON> 4,590,767
<OTHER-SE> 18,982,964
<TOTAL-LIABILITY-AND-EQUITY> 43,823,263
<SALES> 48,629,781
<TOTAL-REVENUES> 49,267,994
<CGS> 41,880,531
<TOTAL-COSTS> 41,880,531
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 158,861
<INTEREST-EXPENSE> 614,199
<INCOME-PRETAX> 2,376,289
<INCOME-TAX> 930,385
<INCOME-CONTINUING> 1,445,904
<DISCONTINUED> 229,477
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,675,381
<EPS-PRIMARY> .84
<EPS-DILUTED> .84
</TABLE>
