PAGE 1
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 September 30, 1995 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 number 1-1915
DeSoto, Inc.
(Exact name of registrant as specified in its charter)
Delaware 36-1899490
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
16750 South Vincennes Road, South Holland, Illinois 60473
(Address of principal executive offices)
708 - 331 - 8800
(Registrant's telephone number, including area code)
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 and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
At October 31, 1995 the registrant had 4,679,207 shares of common
stock outstanding.
PAGE 2
DeSOTO, INC. AND SUBSIDIARIES
INDEX
Page
No.
PART I. FINANCIAL INFORMATION
Consolidated Condensed Statements of Operations
for the Three Months and Nine Months ended
September 30, 1995 and September 30, 1994 3
Consolidated Condensed Balance Sheets as of
September 30, 1995 and December 31, 1994 4
Consolidated Statements of Cash Flows
for the Nine Months Ended September 30, 1995
and September 30, 1994 5
Notes to Consolidated Condensed Financial
Statements 6-7
Management's Analysis of Financial Statements 8-11
PART II. OTHER INFORMATION
Item 1. Legal Proceedings 12
Item 6. Exhibits and Reports on Form 8-K 13
SIGNATURE 14
PAGE 3
DeSOTO, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
(in thousands except per share amounts)
NET REVENUES............................ $ 11,132 $ 21,394 $ 46,373 $ 67,320
COSTS AND EXPENSES:
Cost of sales........................ 12,225 20,851 48,040 65,161
Selling, administrative and general.. 2,821 2,845 8,550 8,944
Retirement security program.......... (1,732) (1,183) (5,114) (3,566)
Nonrecurring expense................. 5,689 - 5,689 -
-------- -------- -------- --------
TOTAL OPERATING COSTS AND EXPENSES...... 19,003 22,513 57,165 70,539
-------- -------- -------- --------
LOSS FROM OPERATIONS.................... (7,871) (1,119) (10,792) (3,219)
OTHER CHARGES AND CREDITS:
Interest expense..................... 87 128 546 436
Nonoperating income.................. - - (6,360) (1,303)
-------- -------- -------- --------
Loss before Income Taxes................ (7,958) (1,247) (4,978) (2,352)
Benefit for Income Taxes................ (1,812) (465) (707) (877)
-------- -------- -------- --------
NET LOSS................................ (6,146) (782) (4,271) (1,475)
Dividends on Preferred Stock............ (88) (81) (256) (236)
------- -------- -------- --------
Net Loss Available for Common Shares.... $ (6,234) $ (863) $ (4,527) $(1,711)
======== ======== ======== ========
NET LOSS PER COMMON SHARE............... $ (1.33) $ (0.19) $ (0.97) $ (0.37)
======= ======== ======== ========
Average Common Shares Outstanding....... 4,679 4,657 4,676 4,656
======= ======== ======== ========
See accompanying notes to consolidated condensed financial statements.
PAGE 4
DeSOTO, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
September 30, December 31,
1995 1994
(Unaudited)
ASSETS (in thousands ofdollars)
Current Assets:
Cash............................................. $ 434 $1,702
Restricted cash.................................. 30 58
Restricted short-term investments................ 620 710
Accounts and notes receivable - Net.............. 7,320 11,848
Inventories:
Finished goods................................. 591 4,331
Raw materials and work-in-process.............. 1,375 4,182
-------- --------
1,966 8,513
Prepaid expenses and other current assets........ 4,384 3,510
-------- --------
Total Current Assets............................. 14,754 26,341
Restricted Investments............................. 4,630 4,666
Property, Plant and Equipment - Net................ 4,926 7,968
Prepaid Pension.................................... 44,989 39,319
Other Non-Current Assets........................... 2,867 4,818
-------- --------
$ 72,166 $ 83,112
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Accounts payable................................. $ 15,414 $14,961
Revolving Credit Agreement....................... - 8,381
Reserves and liabilities related to
restructuring programs......................... 4,393 1,884
Waste site clean-up.............................. 922 2,522
Other............................................ 6,358 5,725
------- --------
Total Current Liabilities...................... 27,087 33,473
Waste site clean-up - long-term.................... 6,518 6,744
Post Retirement and Post
Employment Insurance............................. 1,478 1,510
Deferred Income Taxes.............................. 13,619 13,392
Long-Term Deferred Gain............................ 2,878 3,175
Redeemable Preferred Stock......................... 3,983 3,569
Common Stock and Other Stockholders' Equity........ 16,603 21,249
-------- --------
$ 72,166 $ 83,112
======== ========
See accompanying notes to consolidated condensed financial statements.
PAGE 5
DeSOTO, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Nine Months Ended
September 30,
1995 1994
(in thousands of dollars)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss........................................... $ (4,271) $ (1,475)
Non-cash items:
Loss on disposal of liquid laundry detergent
and fabric softener sheet business............. 2,605 -
Depreciation and amortization.................... (5,670) (3,750)
Deferred income taxes............................ (706) 1,013
Amortization of deferred gain ................... (297) (262)
Net gain on disposal of property,
plant and equipment............................ (48 -
Other non-cash items............................. 38 120
-------- --------
Net non-cash items............................... (2,836) (594)
Changes in assets and liabilities resulting
from operating activities:
Net decrease in inventories.................... 3,418 2,221
Net (increase) decrease in trade accounts
and notes receivable......................... 3,125 (1,389)
Net increase (decrease) in other liabilities... 1,284 (2,458)
Net increase (decrease) in accounts payable.... 453 (119)
Net decrease in other non-current assets....... 203 442
Net decrease in other current assets........... 177 6,630
Other.......................................... - 1
-------- --------
Net cash flows from operating activities......... 1,553 3,259
-------- --------
ASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of liquid laundry detergent
and fabric softener sheet business............. 5,305 -
Proceeds from sale of
property, plant and equipment.................. 500 -
Additions to property, plant and equipment....... 5,560 (631)
------- --------
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments under Revolving Credit Agreement........ (8,381) (2,700)
Exercise of stock options........................ -
70
------- --------
Net cash flows from financing activities........... (8,381) (2,630)
------- --------
Net increase (decrease)
in cash and cash equivalents..................... (1,268) (2)
Cash and cash equivalents at beginning of year..... 1,702 45
------- --------
Cash and cash equivalents at end of period......... $ 434 $ 43
======= ========
See accompanying notes to consolidated condensed financial statements.
PAGE 6
DeSOTO, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Unaudited)
In the opinion of management, the accompanying unaudited consolidated
condensed financial statements contain all adjustments (consisting of
normal recurring accruals) necessary for a fair presentation of the
results of operations for the periods indicated.
The results of operations for the three months and nine months ended
September 30, 1995 are not necessarily indicative of the results to
be expected for the full year.
A. ACCOUNTING POLICIES
The reader is directed to the Company's 1994 Annual Report on Form
10-K previously filed with the Securities and Exchange Commission
for details of the accounting policies followed by the Company.
B. INCOME TAXES
The provision (benefit) for income taxes is computed at the
current estimated effective income tax rate for the year. The
loss before income taxes in 1995 included the write-off of
goodwill of approximately $3.3 million which is not deductible for
income tax purposes.
The Company has received proposed adjustments from the Internal
Revenue Service as a result of their audit of the years 1990
through 1993. These adjustments assess additional tax for the
period under audit as well as penalties and interest. The Company
does not agree with certain of the additional assessments and
plans to appeal the examiner's findings.
C. INVENTORY VALUATION
Inventory at September 30, 1995 is valued at the last-in, first-
out (LIFO) method of inventory accounting. If the first-in, first-
out (FIFO) method of inventory accounting had been used for all of
the Company's inventories, inventories would have been $2,001,000
and $1,889,000 higher than reported at September 30, 1995 and
December 31, 1994, respectively.
D. REVOLVING CREDIT AGREEMENT
On December 7, 1994, the Company entered into a revolving credit
agreement with CIT. The agreement provided for up to $14,000,000
under a revolving credit facility. The funds available for
borrowing were based on a formula which included specified
percents of accounts receivable and inventory. The interest rate
on the facility was prime plus 1 1/4%. Proceeds from the
transactions discussed in both Footnote G and the Management's
Discussion and Analysis were utilized to reduce the CIT debt. As
of September 30, 1995, the revolving credit agreement was
terminated and the Company had no outstanding borrowing. For
further discussion see the Liquidity and Capital Resources section
of Management's Analysis of Financial Statements.
PAGE 7
E. NONOPERATING INCOME
The Company reached settlements in the second quarter with two
insurance carriers regarding the cost of cleanup at certain
hazardous waste sites. As a result of these settlements, the
Company recorded income of approximately $6.0 million during the
second quarter. Nonoperating income also included approximately
$243,000 in the first quarter from royalty income related to
technology sold by the Company in 1990. Nonoperating income
during the second quarter of 1994 resulted from settlements
related to insurance and legal issues. In addition, the Company
recorded nonoperating income during the first quarter of 1994
resulting from the settlement of an arbitration related to a
portion of the business sold by the Company in 1990 and royalty
income related to technology sold by the Company in 1990.
F. STOCKHOLDERS' EQUITY
The components of the change in stockholders' equity during the
nine months ended September 30, 1995 are as follows:
Balance, January 1, 1995 $21,249
Net loss (4,271)
Accrued dividends - redeemable preferred stock (256)
Accretion of redeemable preferred stock to
liquidation preference (158)
Shares issued under employee stock
options and other grants 39
-------
Balance, September 30, 1995 $16,603
=======
G. DISPOSITIONS
On July 21, 1995, the Company announced the transfer and
assignment of various operations and assets involved in its liquid
detergent and fabric softener dryer sheet businesses to two
separate buyers. The Company assigned the rights to certain
customers with respect to these businesses. The Company also sold
other assets which included certain accounts receivable, inventory
and machinery and equipment. Both transactions also provide for
the Company to receive royalties and other earn-out opportunities
over a three-year period in one case and over a four-year period
in the other case. The proceeds of these transactions were
utilized to reduce the Company's senior secured debt owed to CIT.
The Company recorded a net loss on the sale of the liquid
detergent and fabric softener sheet businesses (including the
write-off of related goodwill). The Company also recorded a
charge of $3.1 million in the third quarter relative to costs
associated with the closure of operating facilities relative to
these transactions. The third quarter non-recurring expense of
$5,689,000 reflects the net impact of these transactions.
PAGE 8
The following information is provided on a pro forma basis to
illustrate the effect of certain adjustments to the historical
consolidated financial statements that would have resulted from
the above dispositions if such transactions had occurred on
January 1, 1994. The results are not necessarily indicative of
actual results had the foregoing transactions occurred as
described above, nor do they purport to represent results of
future operations of the Company.
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
(in thousands except per share amounts - unaudited)
Net revenues $6,359 $8,726 $20,069 $28,361
======= ======= ======== ========
Net earnings (loss) $ (226) $ (194) $ 3,279 $ 458
======= ======= ======== ========
Net earnings (loss)
per common share $(0.07) $(0.06) $ 0.65 $ 0.05
======= ======= ======== ========
For additional information, see Management's Analysis of Financial
Statements.
MANAGEMENT'S ANALYSIS OF FINANCIAL STATEMENTS
Liquidity and Capital Resources
During July 1995, in connection with the Company's previously
disclosed review of strategic alternatives, the Company completed the
transfer and assignment to two separate buyers of various operations
and assets involved in its liquid detergent and fabric softener dryer
sheet businesses. The assets involved included certain customer
rights, accounts receivable, inventory and machinery and equipment.
Initial proceeds from these transactions were used to reduce the
Company's senior secured debt under its revolving credit agreement
with CIT. Both transactions also provide for the Company to receive
royalties and other earn-out opportunities over a three-year period
in one case and over a four-year period in the other case. The
Company continues to manufacture powdered laundry detergents at its
facilities in Joliet, Illinois and Union City, California.
In September 1995, the Company completely repaid the outstanding
borrowing under its revolving credit agreement with CIT and the
agreement was terminated. The Company is currently seeking a new
financing agreement. The terms and conditions of a financing
agreement have not been finalized and there can be no assurance that
an agreement will in fact be consummated.
As part of the Company's continuing effort to manage its cash flow
requirements, the Company has undertaken discussions with its trade
creditors. These discussions commenced in September 1995. In an
effort to facilitate such discussions, the creditors have formed a
committee comprised of seven of the Company's trade creditors. The
Company has requested a moratorium on the payment of accounts payable
that existed as of an as yet unspecified date.
PAGE 9
The financing negotiations discussed above and the discussions with
the creditor committee each contemplate various methods of maximizing
the economic benefit to the Company of its over-funded pension plan.
The Company anticipates that the excess would become a component of
the financing agreement and/or a payout plan to satisfy the trade
creditors.
The aforesaid dispositions and the resulting shut-down of the
Company's operating facilities in South Holland and Thornton,
Illinois are expected to reduce the cash required to fund continuing
operations. However, in light of the uncertainty with respect to
future sources of liquidity, there can be no assurance that the
Company will have adequate liquidity on a going forward basis to fund
operations.
The disposition of the liquid detergent and fabric softener sheet
businesses contributed to the decrease in accounts receivable,
inventory and property, plant and equipment at September 30, 1995
versus December 31, 1994.
Accounts receivable at September 30, 1995, when compared to December
31, 1994, also reflect a reduction in trade accounts receivable due
to the impact of reduced sales. Inventory levels have declined
during the same time period due in part to lower requirements
stemming from lower sales.
Other current assets increased since the prior year end primarily due
to an increase in current deferred income tax assets. This increase
reflects the tax effects of a provision for costs associated with the
closure of the operating facilities described above.
Factors contributing to the decline in property, plant and equipment,
other than the dispositions discussed above, include the sale of
equipment no longer used in operations as well as the excess of
depreciation over capital expenditures.
Other non-current assets decreased during the first nine months of
1995 due to the write-off of approximately $3.3 million of goodwill
in the third quarter. This write-off was partially offset by the
minimum long-term royalty of $1.6 million recorded as part of the
disposition of the liquid detergent and fabric softener sheet
businesses in July.
The increase in accounts payable reflects the payment of invoices
beyond terms as discussed above. The increase in restructuring
reserves reflects the third quarter provision of $3.1 million
relative to costs associated with the closure of operating facilities
that produced liquid detergent products and fabric softener sheets.
The current portion of the waste site clean-up liability declined
versus the 1994 year-end primarily due to payments relative to three
sites. In the case of one of the waste sites, the Company has been
released from further participation in funding cleanup of the site.
Approximately $1.8 million of the $2.0 million of cash used to fund
these payments was generated from restricted short-term investments
or insurance proceeds.
PAGE 10
Results of Operations for the Nine Months Ended September 30, 1995
Results of operations for the nine months ended September 30, 1995
reflect the disposition of the Company's liquid detergent and fabric
softener dryer sheet businesses as of July 1995. These businesses
accounted for approximately $26.3 million of net revenues during the
first nine months of 1995 and $39.0 million of net revenues during
the comparable period in 1994. Sales in 1995 include approximately
$3.5 million of sales of liquid laundry detergent that occurred after
the closing date of the transactions. These sales primarily occurred
as part of the transition process before full production was
transferred to the buyers. The Company continues to manufacture
powdered laundry detergents.
Net revenues for the first nine months of 1995 decreased
approximately 31% versus the same period in 1994. The decline can be
attributed largely to a decrease in sales to three customers: Kmart,
Lever Brothers and Sears.
Sales to Kmart in 1995 were approximately $5.2 million lower than the
comparable period in 1994. Nearly half of the 1995 decline in Kmart
sales occurred in the third quarter as a result of the disposition of
the liquid detergent and fabric softener sheet businesses. The other
major factor contributing to the decline in Kmart sales was a higher
level of promotional activity by Kmart in 1994.
Sales to Lever Brothers in 1994 included approximately $3.3 million
of sales of auto dish gel and fabric softener sheets. As previously
reported, Lever transferred this business out of DeSoto during the
second and third quarters of 1994. The Company no longer
manufactures either product.
Nine months sales to Sears in 1995 were approximately $2.2 million
lower than the same period in 1994. This decline was partially
attributable to promotional activity in 1994 as well as competitive
pressures on the Company that have had a negative impact on sales in
general.
Lower gross profit resulted from pricing pressures, product/customer
mix, lower volume, and the continued escalation in the cost of
corrugated and plastic packaging as well as unrecovered fixed costs
at certain of the Company's operating plants. In addition, the
Company continued to manufacture products for the buyer of its liquid
detergent business during the third quarter. These products were
sold to the buyer at prices that approximated cost.
Selling, general and administrative expenses were lower than the
first nine months of 1994. The expenses in 1994 reflected the
operation of the Columbus, Georgia facility, which closed in March
1994, and the Stone Mountain, Georgia facility, which closed in July
1994. The lower 1995 expense level also reflects the continued
efforts at cost containment.
Nonrecurring expense included a net loss on the sale of the liquid
detergent and fabric softener sheet businesses (including the write-
off of related goodwill) and a $3.1 million provision for costs
associated with the closure of operating facilities as part of these
dispositions.
Interest expense was higher for the first nine months of 1995 versus
the same period last year, due to a higher interest rate because of
the increase in the prime rate.
PAGE 11
Nonoperating income during 1995 included approximately $6.0 million
from insurance settlements and approximately $243,000 of royalty
income related to technology sold by the Company in 1990.
Nonoperating income in 1994 included settlements related to insurance
and legal issues and royalty income related to technology sold by the
Company in 1990.
Results of Operations for the Three Months Ended September 30, 1995
Third quarter net revenues declined 48% in 1995 when compared to the
third quarter of 1994. A major portion of this decline is the result
of the disposition of the Company's liquid detergent and fabric
softener dryer sheet businesses as of July 1995. These businesses
accounted for approximately $12.7 million of sales in the third
quarter of 1994 versus $4.8 million in the 1995 third quarter.
Competitive pressures had a negative impact on sales in general and
contributed to a 28% decrease in sales to Sears for the quarter.
Sears sales in the 1994 third quarter also benefited from promotional
activity during that period.
The decline in gross profit resulted from pricing pressures, reduced
volume and unrecovered fixed costs at certain of the Company's
operating facilities. Significant increases in the cost of
corrugated and plastic packaging contributed to the decline as well.
In addition, products manufactured during the third quarter for the
buyer of the Company's liquid detergent business were sold to that
buyer at prices that approximated the Company's cost, further
reducing the Company's gross profit as a percentage of sales.
Nonrecurring expense during the quarter included a net loss
(including the write-off goodwill) on the disposition of the liquid
detergent and fabric softener sheet businesses. In addition, the
Company recorded a charge of $3.1 million during the quarter
providing for the costs associated with the shut-down of
manufacturing facilities relating to these dispositions.
PAGE 12
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
On October 3, 1995, the Company received a unilateral
Administrative Order issued by the U. S. Environmental Protection
Agency under Section 106 of the Comprehensive Environmental Response,
Compensation and Liability Act of 1980 ("CERCLA"), alleging that the
Company is a potentially responsible party ("PRP") in connection with
the Marina Cliffs Site in the City of South Milwaukee, Wisconsin.
The Company is currently investigating its alleged liability, but
presently believes that it has no liability and that any potential
environmental damage at the site is the result of activity by parties
other than DeSoto.
Fort Dearborn Lithograph Co. has filed suit against the
Company in the Circuit Court of Cook County, Illinois, seeking to
collect allegedly unpaid invoices for goods and services, of
approximately $500,000. The Company has filed an answer which
disputes, among other things, the alleged amount owed. Discovery is
ongoing and this matter could be decided as early as January 1996.
PAGE
13
Item 6. Exhibits and Reports on Form 8-K
a) The exhibits to this report are listed in the
Index to Exhibits on page 15 hereof.
b) Reports on Form 8-K. A
current report on Form 8-K dated as of September 1,
1995 was filed to report under Item 5 the appointment
of Anne E. Eisele as President, and William Spier as
Chief Executive Officer, of the Company replacing
John R. Phillips who resigned as President and Chief
Executive Officer, and as a Director, of the Company.
PAGE 14
SIGNATURE
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.
DeSOTO, INC.
(Registrant)
Anne E. Eisele
----------------------------
Anne E. Eisele
President and
Chief Financial Officer
(Principal Financial Officer)
William Spier
----------------------------
William Spier
Chief Executive Officer
November 14, 1995
- ---------------------------------
Date
PAGE 15
DeSOTO, INC. AND SUBSIDIARIES
INDEX TO EXHIBITS
11 - Computation of Fully Diluted Earnings Per Share
27 - Financial Data Schedule
__________________
* SEC File No. 1-1915
PAGE 16
Exhibit 11
DeSOTO, INC. AND SUBSIDIARIES
COMPUTATION OF FULLY DILUTED EARNINGS PER SHARE
(in thousands except per share amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
Net Loss $(6,146) $ (782) $(4,271) $(1,475)
Preferred Dividends (88) (81) (256) (236)
------- ------- ------- -------
Net Loss
Applicable to Common Stock $(6,234) $ (863) $(4,527) $(1,711)
======= ======= ======= =======
Net Loss
Per Common Share: $ (1.33) $ (0.19) $ (0.97) $ (0.37)
======= ======= ======= =======
Average Common Shares
Outstanding (A) 4,679 4,657 4,676 4,656
======= ======= ======= =======
Net Fully Diluted Loss
Per Common Share (B) $ (1.33) $ (0.19) $ (0.97) $ (0.37)
======= ======= ======= =======
Average Common Shares
Outstanding 4,679 4,657 4,676 4,656
Additional Shares Outstanding
After Application of the
Treasury Stock Method - - - 1
------- ------- ------- -------
Total (B) 4,679 4,657 4,676 4,657
======= ======= ======= =======
(A) Outstanding common stock options and common stock warrants have
been omitted because the effect reduces the net loss per share.
(B) Reflecting the dilutive effect of outstanding common stock
options and common stock warrants under the treasury stock method.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Consolidated Statements of Operations and the Consolidated Balance Sheets and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 9-MOS
<FISCAL-YEAR-END> DEC-31-1995 DEC-31-1995
<PERIOD-END> SEP-30-1995 SEP-30-1995
<CASH> 434 434
<SECURITIES> 0 0
<RECEIVABLES> 7,320 7,320
<ALLOWANCES> 0 0
<INVENTORY> 1,966 1,966
<CURRENT-ASSETS> 14,754 14,754
<PP&E> 19,517 19,517
<DEPRECIATION> 14,591 14,591
<TOTAL-ASSETS> 72,166 72,166
<CURRENT-LIABILITIES> 27,087 27,087
<BONDS> 0 0
<COMMON> 5,619 5,619
3,983 3,983
0 0
<OTHER-SE> 10,984 10,984
<TOTAL-LIABILITY-AND-EQUITY> 72,166 72,166
<SALES> 11,132 46,373
<TOTAL-REVENUES> 11,132 46,373
<CGS> 12,225 48,040
<TOTAL-COSTS> 19,003 57,165
<OTHER-EXPENSES> 0 (6,360)
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 87 546
<INCOME-PRETAX> (7,958) (4,978)
<INCOME-TAX> (1,812) (707)
<INCOME-CONTINUING> (6,146) (4,271)
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> (6,146) (4,271)
<EPS-PRIMARY> (1.33) (0.97)
<EPS-DILUTED> (1.33) (0.97)
</TABLE>
