SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
- --- EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED
December 31, 1998.
-----------------
OR
- --- TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934 For the Transition period from _________
to ____________
Commission file number 0-8864
------
PACER TECHNOLOGY
--------------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
California 77-0080305
- --------------------------------- -------------------------
(State or other jurisdiction of (IRS Employer Identifi-
incorporation or organization cation No.)
9420 Santa Anita Avenue
Rancho Cucamonga, California 91730-6117
- ---------------------------------------- ---------------
(Address of principal executive offices) (Zip Code)
909-987-0550
-------------------------------
(Registrant's telephone number)
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 XXX NO
--- ---
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Common stock, no par value, shares outstanding as of December 31, 1998 were
15,939,475.
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
PACER TECHNOLOGY & SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
- -----------------------------------------------------------------------------
ASSETS
======
December 31, June 30,
1998 1998
(Unaudited) (Unaudited)
------------- ----------
CURRENT ASSETS:
Cash $ 662,069 277,370
Trade receivables, less allowance for
doubtful accounts of $599,596 and
$524,596 respectively (note 2) 13,825,336 8,591,327
Other receivables 175,217 146,299
Notes receivable - Current (note 2) 129,301 188,642
Inventories (note 3) 11,516,121 10,974,578
Prepaid expenses 961,059 810,451
Deferred income taxes 1,146,769 1,146,769
---------- ----------
Total current assets 28,415,872 22,135,436
EQUIPMENT & LEASEHOLD IMPROVEMENTS:
Cost 6,898,314 6,276,866
Accumulated depreciation & amortization (4,747,328) (4,457,083)
---------- ----------
Total Equipment & Leasehold Improvements 2,150,986 1,819,783
Deferred income taxes 124,065 124,065
Cost in excess of net assets acquired, net 3,548,407 3,689,516
Other Assets 28,370 30,125
---------- ----------
Total Assets $34,267,700 27,798,925
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
====================================
CURRENT LIABILITIES:
Current Portion of long-term debt (note 4) 333,333 333,333
Accounts payable 4,734,516 4,135,472
Accrued payroll and related expenses 668,185 494,780
Other accrued expenses 2,797,584 2,667,486
Total Current Liabilities 8,533,618 7,631,071
Long-term debt, excluding current
installments (note 4) 13,689,222 9,535,889
---------- ----------
Total Liabilities 22,222,840 17,166,960
STOCKHOLDERS' EQUITY:
Common stock, no par value. Authorized
50,000,000 shares;issued and outstanding
15,939,475 shares at Dec 31, 1998
and 15,864,975 shares in June 30, 1998. 8,305,499 8,270,633
Retained Earnings 3,991,251 2,613,453
Notes receivable from directors (note 5) (265,227) (265,257)
Other comprehensive income (note 6) 13,337 13,136
---------- ----------
Total stockholders' equity 12,044,860 10,631,965
Total Liabilities & Stockholders' Equity $ 34,267,700 27,798,925
========== ==========
See accompanying notes to condensed consolidated financial statements.
<PAGE>
PACER TECHNOLOGY & SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
------------------------------------------------------------
Three-Months Ended Six-Months Ended
December 31, December 31,
1998 1997 1998 1997
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
----------- ---------- ---------- ----------
NET SALES $ 11,840,117 6,273,501 25,497,826 13,648,651
COST OF SALES 7,704,599 4,021,341 16,443,321 8,662,349
---------- ---------- ---------- ----------
Gross Profit 4,135,518 2,252,160 9,054,505 4,986,302
SELLING, GENERAL AND
ADMINISTRATIVE EXPENSES 3,193,159 1,705,678 6,236,875 3,504,747
---------- ---------- ---------- ----------
Operating Income 942,359 546,483 2,817,630 1,481,556
OTHER (INCOME) EXPENSE:
Interest expense, net 266,471 71,728 519,859 195,051
Other (income) expense, net (71,898) (9,441) (114,508) (11,712)
---------- ---------- ---------- ---------
Income before income taxes 747,786 484,196 2,412,279 1,298,217
Income tax expense 326,900 208,550 1,034,482 571,698
---------- --------- ---------- ----------
NET INCOME $ 420,886 $ 275,646 1,377,797 726,519
========== ========= ========== ==========
Weighted Average Shares-
Basic (Note 7) 15,914,642 15,849,975 15,889,809 15,849,975
(Note 7)
Basic Earnings Per Share $ 0.03 $ 0.02 $ 0.09 $ 0.05
========== ========== ========== ==========
Adjusted Weighted
Average Shares - Diluted 17,867,284 17,138,808 17,849,241 17,389,432
(Note 7)
Diluted Earnings Per Share $ 0.02 $ 0.02 $ 0.08 $ 0.04
========== ========= ========== ==========
See accompanying notes to condensed consolidated financial statements.
<PAGE>
PACER TECHNOLOGY & SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
- --------------------------------------------------------------------------
Six-Months Ended
December 31,
1998 1997
(Unaudited) (Unaudited)
---------- -----------
NET INCOME $1,377,797 726,519
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation 316,334 284,673
Amortization of other assets 141,109 136,367
Increase provision for doubtful
accounts 75,000 52,800
(Increase) in trade accounts
receivable (5,309,009) (639,975)
(Increase) Decrease in other receivables (28,687) 31,468
Decrease in notes receivables 59,342 27,076
(Increase) in inventories (541,543) (279,939)
(Increase) in prepaid expenses
and other assets (148,853) (405,972)
Increase (decrease) in accounts payable 599,044 (587,936)
Increase in accrued payroll
and related expenses 173,405 72,797
Increase in accrued expenses and other
liabilities 130,098 231,455
---------- ---------
NET CASH USED IN OPERATING ACTIVITIES (3,155,963) (350,667)
CASH FLOWS FROM INVESTING ACTIVITIES:
Acquisition of California Chemical
Specialties, Inc. - (2,276,114)
Capital expenditures (647,537) (379,732)
-------- ---------
NET CASH USED IN INVESTING ACTIVITIES (647,537) (2,655,846)
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on line of credit (5,420,000) (792,000)
Payments on term loan (166,667) (4,980,068)
Borrowings on long-term debt 9,740,000 8,599,000
Issuance of Common Stock 34,866 -
Repayment of Notes Receivables
from Director - 270,956
--------- ---------
NET CASH PROVIDED BY FINANCING ACTIVITIES 4,188,199 3,097,888
Net increase in cash 384,699 91,375
Cash at beginning of year 277,370 294,298
--------- ---------
CASH AT END OF SIX-MONTH PERIOD $ 662,069 385,673
========= =========
Supplemental Disclosures of cash flow information:
Interest paid during the period $ 431,859 198,663
-------- ---------
Income taxes paid during the period $ 890,800 838,000
-------- ---------
See accompanying notes to condensed consolidated financial statements.
<PAGE>
PACER TECHNOLOGY & SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
- -----------------------------------------------------------------------------
1. CONSOLIDATED FINANCIAL STATEMENTS:
---------------------------------
The consolidated financial statements for the three-month and the six-
month periods ended December 31, 1998 and 1997 have been prepared by the
Company without audit. In the opinion of Management, adjustments
necessary to present fairly the consolidated financial position at
December 31, 1998 and the results of operations for the period then ended
have been made. All such adjustments are of a normal recurring nature.
Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested
that these consolidated financial statements be read in conjunction with
the consolidated financial statements and notes thereto included in the
Company's Annual Report to shareholders. The results of operations for
the period ended December 31, 1998 are not necessarily indicative of the
operating results for the full year.
2. NOTES RECEIVABLE:
----------------
Several customers have converted trade receivable balances to term notes.
The notes are payable in monthly installments of principal and interest
at a rate higher than the rate of interest charged to Pacer for its
borrowing of funds from its predominant bank.
3. INVENTORIES:
-----------
Inventories consisted of the following:
December 31, 1998 June 30, 1998
----------------- -------------
Raw materials $ 5,773,194 $ 5,103,266
Work-in-process 614,641 542,489
Finished goods 5,128,286 5,328,823
---------- ----------
Total inventories $11,516,121 $10,974,578
========== ==========
4. LONG-TERM DEBT:
--------------
On June 25, 1997, the Company entered into a promissory note agreement
with its primary bank whereby Pacer can borrow up to $8,000,000 to be
utilized for working capital, capital expenditures and acquisitions. On
May 18, 1998 this note was increased to $17,000,000 and is cross-
collateralized by trade accounts receivable, inventory and certain
equipment. The interest is at the bank's prime rate (7.75% at December
31, 1998) plus 0.5%. The note requires monthly interest payments only and
has a maturity date of July 1, 2000. Prepayments of the principal balance
are permitted without penalty.
This new credit facility was utilized to retire in July, 1997, the
Company's line of credit balance ($792,000 at June 30, 1997), and two (2)
term loans ($484,068 total at June 30, 1997), as well as to finance
capital equipment purchases and working capital.
In addition to the above, on May 18, 1998 the Company entered into two
(2) other agreements as follows:
<PAGE>
(1) Letter of credit: $5,000,000 from May 1, 1998 to September 30,
1998 and $2,000,000 from October 1, 1998 to April 30, 1999.
This agreement includes issuance fees of 1/8% for each letter
of credit.
(2) Term loan of $1,000,000 with a maturity date of July 1, 2000
bearing interest at the prime rate (7.75% at December 31, 1998)
plus .5%. This term loan was used to finance leasehold
improvements, capital expenditures, and all other costs related
to closing and relocating Cook Bates facilities to Pacer
locations. This term loan has a maturity date of 3 years from
funding and is payable in monthly installments of principal and
interest.
The agreements require maintenance of certain financial ratios and
contains other restrictive covenants. Pacer Technology was in compliance
with all debt covenants on December 31, 1998.
Subsequent to December 31, 1998, the Company entered into a credit
agreement with an alternate bank. This agreement will become effective on
approximately February 22, 1999. This new credit facility will be
utilized to replace all existing bank debt and finance future working
capital and capital equipment requirements. The structure of the new
credit facility is more favorable than the existing agreement including
improved lending rates.
5. NOTES RECEIVABLE FROM DIRECTORS:
-------------------------------
On September 27, 1994, three Directors exercised options to purchase
100,000 shares each (300,000 total) of Pacer Technology common stock. Each
Director signed a secured promissory note for the principal sum of
$58,437.50 ($175,312.50 total) with interest of 7.8% per annum payable to
Pacer Technology. One of these notes was paid in full on January 13,
1997, plus interest accrued as of the date of payment. On April 1, 1998,
one Director paid $34,846.59 against the principal balance, plus accrued
interest. The balance of this note, $23,590.91, is secured by 40,369
shares of the Company's common stock. The remaining note is secured by
100,000 shares of the Company's common stock as provided in a Security
Agreement between the Company and the Director. On October 19, 1994, a
Director exercised options to purchase 485,000 shares of Pacer Technology
common stock. This director signed a secured promissory note for the
principal sum of $309,187.50, plus simple interest of 7.89% per annum
payable to Pacer Technology. This note was secured by 485,000 shares of
the Company's common stock as provided in a Security Agreement between the
Company and the Director. On August 14, 1997, the director paid
$149,988.45 against the principal balance, plus accrued interest. The
balance of this note, $159,199.05, is secured by 249,724 shares of the
Company's common stock.
The remaining principal balances and all accrued interest will be due and
payable in one lump sum on March 29, 1999 and April 19, 1999, respec-
tively; subject to the provisions regarding prepayment noted below.
Each Director may sell the shares securing the Note in whole or in part,
without penalty, provided that the proceeds of sale are applied to the
Note. The amount of each prepayment shall be applied as follows:
(a) first, to interest accrued on the Note with respect to the shares
sold, to the date of sale;
(b) second, to the outstanding principal on the Note in the amount of
$0.584375 and $0.6375 per share sold, respectively; and
(c) third, to the seller or his designee.
<PAGE>
If all principal and accrued interest on the Notes is not paid in full on
or before March 29, 1999 and April 19, 1999, respectively, the Company
shall be entitled to exercise any and all remedies available to it under
the California Commercial Code, with full recourse to the personal assets
of the Directors.
On September 11, 1995, one Director exercised options to purchase 100,000
shares of Pacer Technology common stock. The Director signed a secured
promissory note for the principal sum of $24,000 plus simple interest of
7.015% per annum payable to Pacer Technology. Principal and all accrued
interest will be due and payable in one lump sum on September 11, 1999;
subject to the provisions regarding prepayment noted below. The note is
secured by 100,000 shares of the Company's common stock as provided in a
Security Agreement between the Company and the Director. On November 20,
1995, a Director exercised warrants to purchase 381,000 shares of Pacer
Technology common stock. This director signed a secured promissory note
for the principal sum of $120,967.50, plus simple interest of 6.6939% per
annum payable to Pacer Technology. This note was paid in full on August
14, 1997 plus interest accrued as of the date of payment.
The Director may sell the shares securing the $24,000 Note in whole or in
part, without penalty, provided that the proceeds of sale are applied to
pre-pay the Note. The amount of each prepayment shall be applied as
follows:
(a) first, to interest accrued on the Note with respect to the shares
sold, to the date of sale;
(b) second, to the outstanding principal on the Note in the amount of
$0.24 per share sold; and
(c) third, to the seller or his designee.
If all principal and accrued interest on the Note is not paid in full on
or before September 11, 1999, the Company shall be entitled to exercise
any and all remedies available to it under the California Commercial Code,
with full recourse to the personal assets of the Director.
6. Comprehensive Income
--------------------
In the current period, the Company adopted SFAS 130 "Reporting Comprehensive
Income", which establishes standards for disclosing comprehensive income in both
annual and interim financial statements. Accordingly, the Company's
comprehensive income was as follows:
Three-Months Ended Six-Months Ended
December 31, December 31,
1998 1997 1998 1997
-------- -------- --------- --------
Net Income $ 420,886 275,646 1,377,797 726,519
Foreign currency
translation adjustment (16,766) - 201 -
-------- -------- --------- --------
Comprehensive Income $ 404,120 275,646 1,377,998 726,519
======== ========= ========= ========
<PAGE>
7. Earnings Per Share
------------------
Earnings per share is computed based on the weighted average number of shares
outstanding and in accordance with Statement of Financial Accounting Standards
("SFAS") No. 128 "Earnings Per Share". Dilutive securities consisting of common
stock options are included in the computation of earnings per dilutive share
when their effect is dilutive. Accordingly, "Basic EPS" and "Diluted EPS" are
calculated as follows:
Three-Months Ended Six-Months Ended
December 31, December 31,
1998 1997 1998 1997
---------- --------- ---------- ---------
Numerator:
Numerator for basic and
diluted earnings
per share-net income $ 420,886 275,646 1,377,797 726,519
Denominator:
Denominator for basic
earnings per share - weighted
average number of
common shares outstanding
during the period 15,914,642 15,849,975 15,889,809 15,849,975
Incremental common shares
attributable to exercise of
outstanding options 1,952,642 1,288,833 1,959,432 1,539,457
---------- ---------- ---------- ----------
Denominator for diluted
earnings per share 17,867,284 17,138,808 17,849,241 17,389,432
========== ========== ========== ==========
Basic earnings per share $ 0.03 $ 0.02 $ 0.09 $ 0.05
========== ========== ========== ==========
Diluted earnings per share $ 0.02 $ 0.02 $ 0.08 $ 0.04
========== ========== ========== ==========
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
----------------------------------------------------------------------
of Operations.
-------------
RESULTS OF OPERATIONS
- ---------------------
Net sales for the quarter ended December 31, 1998 increased by 89% to
$11,840,117 from $6,273,501 for the same quarter last year. Operating income
improved 72% to $942,359 for the second quarter compared to $546,483 in the
same period a year ago. Net income advanced 53% to $420,886 versus $275,646 for
the comparable prior year quarter. For the six months ended December 31, 1998,
net sales improved 87% to $25,497,826 from $13,648,651 during the first six
months of 1997. Operating income was $2,817,630 a 90% increase from $1,481,556
in the comparable period a year ago. Net income also rose 90% to $1,377,797,
up from $726,519 in the 1997 first six-month period.
Domestic sales accounted for approximately 90% of total sales for the first six
months to $23,211,492 versus $10,920,453 in the prior year. The increase was
driven largely by revenues from Cook Bates and the Company's Super Glue product
line. The Company experienced strong seasonal sales related to pre-holiday
Halloween and Christmas purchases of Cook Bates products. For the most part,
pre-Cook Bates sales remained relatively level.
International sales decreased to $2,429,568, representing 10% of total sales for
the first half, versus $2,728,198, or 20% of total sales for the comparable
period last year. The lower percentage of total revenue was primarily due to
the inclusion of results from Cook Bates, whose products are mostly distributed
domestically, and the general slow down in the world economy.
Cost of sales for the second quarter ended December 31, 1998 was $7,704,599, or
65% of sales. This represents an increase of $3,683,258, or 92% over the
comparable period in the prior year. For the six months ended December 31,
1998, cost of sales was $16,443,321, or 64% of sales. This represented a rise
of $7,780,972, or 90% over the same period last year. The rise was primarily
due to increased sales volume related to the Cook Bates products.
Selling, general and administrative expenses for the second quarter ended
December 31, 1998 were $3,193,159 or 27% of sales. This represented an increase
of $1,487,481 from $1,705,678 or 87% of sales over the comparable quarter in the
prior year. For the six-month period ended December 31, 1998, selling, general
and administrative expenses were $6,236,875, or 24% of sales. This was an
increase of $2,732,128 from $3,504,747 or 78% of sales over the comparable six-
month period in the prior year. These spending increases were mostly attributed
to operating costs related to Cook Bates.
Goodwill related to the Super Glue acquisition is being amortized over 14 years.
Amortization costs of $33,338 and $66,677 were recorded during the second
quarter and six-month period ended December 31, 1998 respectively. Goodwill
related to California Chemical Specialties, Inc., is being amortized over 20
years. Amortization costs of $28,451 and $56,903 were recorded during the
second quarter and six-month period of fiscal year 1999. Management believes
the Super Glue and California Chemical product lines will continue to generate
profits that will significantly exceed the goodwill amortization.
Interest expense for the quarter ended December 31, 1998 was $266,471 compared
to $71,728 for the same period a year ago. For the six-month period ended
December 31, 1998, interest expense was $519,859 versus $195,051 during the same
period in the prior year. This increase was attributed primarily to bank
borrowings utilized to finance the acquisition of Cook Bates and related working
capital requirements.
Other income for the second quarter of fiscal year 1999 was $71,898 compared to
$9,441 for the same period in the prior year. For the six-month period ended
December 31, 1998, other income was $114,508 versus $11,712 for the first half
<PAGE>
of fiscal year 1998. This change was mainly attributed to early payment
purchase discounts offered by the Company's suppliers.
Income taxes increased during the second quarter and six-month period ended
December 31, 1998 compared to the corresponding prior year period due to
substantial improvement in taxable income.
The company's effective tax rate was 44% and 43%, respectively for the second
quarter and six-month period ended December 31,1998.
LIQUIDITY AND CAPITAL RESOURCES:
- -------------------------------
Net cash provided by all activities during the first six months of fiscal year
1999 was $384,699 compared to $91,375 during the comparable period in fiscal
year 1998.
Cash consumed by operations during the first half of fiscal year 1999 was
$3,155,963 compared to cash consumed of $350,667 during the comparable period in
fiscal year 1998. The increases in accounts receivable and inventories were
primarily volume generated from Cook Bates seasonal sales related to Halloween
and Christmas products. The increase in accounts payable pertained to seasonal
purchases required to support pre-holiday sales of Cook Bates products. The
rise in prepaid expenses during the six-month period of fiscal year 1999 was
caused primarily by advance payments to suppliers for capital equipment
purchases.
Cash used in investing activities was $647,537 in the first six months of fiscal
year 1999 compared to $2,655,846 during the comparable period in fiscal year
1998. The increase during the first half of fiscal year 1998 was attributed to
the acquisition of California Chemical Specialties, Inc.
Cash provided by the company's financing activities was $4,188,199 during the
first six months of fiscal year 1999 versus $3,097,888 during the same period in
fiscal year 1998. The increase during the first half of fiscal year 1999 was
attributed primarily to the Company's long term debt borrowings utilized to
finance working capital and capital equipment to support higher volumes gene-
rated by the Cook Bates acquisition.
Pacer anticipates utilization of its new credit facility to supplement cash
requirements for working capital and capital equipment purchases during the
coming year. Management is of the opinion that such source of cash coupled with
cash provided from operations will be sufficient to support the needs of the
Company for the balance of this fiscal year.
Certain Trends and Uncertainties
- -------------------------------
Year 2000 Risks
- ---------------
The 'Year 2000' issue concerns the potential exposures related to the automated
generation of business and financial misinformation resulting from the
application of computer programs which have been written using two digits,
rather than four, to define the applicable year of business transactions.
Most of the Company's operating systems with Year 2000 issues have been modified
to achieve compliance. It is anticipated that all remaining issues will be
resolved by March 31, 1999. Management does not anticipate any significant
costs, problems or uncertainties pertaining to becoming Year 2000 compliant.
The Company is in the process of surveying its major customers and key supliers
to assess their Year 2000 readiness. A failure to successfully address the
Year 2000 issue could have a material adverse effect on the Company's business
or results of operations. Therefore, the Company's contingency plans for
remediation actions include the use of alternate suppliers and/or the manual
performance of certain administrative tasks that would otherwise be performed
by the Company's computer systems.
<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.
PACER TECHNOLOGY
February 12, 1999 /s/James T. Munn
James T. Munn
President/Chief Executive Officer
February 12, 1999 /s/Roberto J. Cavazos, Jr.
Roberto J. Cavazos, Jr.
Chief Financial Officer
<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.
PACER TECHNOLOGY
February 12, 1999 --------------------------------
By: James T. Munn
President/Chief Executive Officer
February 12, 1999 --------------------------------
By: Roberto J. Cavazos, Jr.
Chief Financial Officer
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1999
<PERIOD-START> JUL-31-1998
<PERIOD-END> DEC-31-1998
<CASH> 662
<SECURITIES> 0
<RECEIVABLES> 13,825
<ALLOWANCES> 560
<INVENTORY> 11,516
<CURRENT-ASSETS> 28,416
<PP&E> 6,898
<DEPRECIATION> 4,747
<TOTAL-ASSETS> 34,268
<CURRENT-LIABILITIES> 8,534
<BONDS> 0
0
0
<COMMON> 8,305
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 34,268
<SALES> 25,498
<TOTAL-REVENUES> 25,498
<CGS> 16,443
<TOTAL-COSTS> 6,237
<OTHER-EXPENSES> (115)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 520
<INCOME-PRETAX> 2,412
<INCOME-TAX> 1,034
<INCOME-CONTINUING> 1,378
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,378
<EPS-PRIMARY> .09
<EPS-DILUTED> .08
</TABLE>
