<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 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 1-10538
GAMMA BIOLOGICALS, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Texas 74-1668436
- ----------------------------------- --------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3700 Mangum Road, Houston, Texas 77092
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
(713) 681-8481
- --------------------------------------------------------------------------------
(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 [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
At February 13, 1996: 4,551,802 shares
<PAGE>
PART I. FINANCIAL INFORMATION
GAMMA BIOLOGICALS, INC.
Consolidated Balance Sheets
(Unaudited)
<TABLE>
<CAPTION>
ASSETS DECEMBER 31, MARCH 31,
1995 1995
--------------- -------------
(UNAUDITED)
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents.............. $ 2,578,505 $ 1,795,854
Short-term investments................. 1,098,323 2,094,112
Receivables - net of allowance for
doubtful accounts of $183,548 and
$201,668, respectively................ 3,442,948 3,987,349
Inventories............................ 3,776,967 3,807,495
Prepaid expenses....................... 525,197 514,334
Deferred taxes......................... 120,000 124,400
----------- -----------
Total current assets................... 11,541,940 12,323,544
----------- -----------
PROPERTY - at cost, net of accumulated
depreciation and amortization of
$5,532,007 and $5,084,309,
respectively........................... 4,890,981 4,190,560
CASH VALUE OF LIFE INSURANCE............ 1,664,563 1,531,998
OTHER ASSETS............................ 288,756 337,806
----------- -----------
TOTAL................................. $18,386,240 $18,383,908
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of long-term obligations $ 104,830 $ 602,746
Accounts payable - trade............... 485,735 565,649
Dividends payable...................... 113,749 113,528
Accrued salaries and other expenses.... 230,954 366,446
----------- -----------
Total current liabilities............ 935,268 1,648,369
----------- -----------
LONG-TERM OBLIGATIONS................... 373,252 19,263
----------- -----------
DEFERRED TAXES.......................... 244,400 262,600
----------- -----------
SHAREHOLDERS' EQUITY.................... 16,833,320 16,453,676
----------- -----------
TOTAL.................................. $18,386,240 $18,383,908
=========== ===========
</TABLE>
See notes to unaudited consolidated financial statements.
2
<PAGE>
GAMMA BIOLOGICALS, INC.
Statements of Consolidated Income
(Unaudited)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
-------------------------------- ----------------------------
DECEMBER 31, DECEMBER 31,
-------------------------------- ----------------------------
1995 1994 1995 1994
------------------ ------------ ------------- -------------
<S> <C> <C> <C> <C>
NET SALES......................... $4,202,417 $4,773,236 $12,622,215 $13,417,101
COST OF SALES..................... 2,005,036 2,238,716 5,842,063 6,183,120
---------- ---------- ----------- -----------
GROSS MARGIN...................... 2,197,381 2,534,520 6,780,152 7,233,981
---------- ---------- ----------- -----------
OPERATING EXPENSES:
Selling......................... 878,574 890,306 2,608,270 2,655,001
General and administrative...... 621,802 573,766 1,755,267 1,683,932
Shipping and warehouse.......... 211,364 192,849 683,846 532,333
Research and development........ 347,047 297,712 976,004 770,872
---------- ---------- ----------- -----------
Total operating expense...... 2,058,787 1,954,633 6,023,387 5,642,138
---------- ---------- ----------- -----------
OPERATING INCOME.................. 138,594 579,887 756,765 1,591,843
---------- ---------- ----------- -----------
OTHER INCOME (EXPENSE):
Interest income................. 63,548 71,225 200,423 179,917
Interest expense................ (3,295) (16,400) (35,345) (51,274)
Other - net..................... (803) (43,946) 21,476 (82,512)
---------- ---------- ----------- -----------
Other income - net........... 59,450 10,879 186,554 46,131
---------- ---------- ----------- -----------
INCOME BEFORE INCOME TAXES........ 198,044 590,766 943,319 1,637,974
INCOME TAXES...................... 30,600 106,500 251,800 490,000
---------- ---------- ----------- -----------
NET INCOME........................ $ 167,444 $ 484,266 $ 691,519 $ 1,147,974
========== ========== =========== ===========
Weighted average number of common
and common equivalent shares
outstanding.................... 4,613,352 4,632,479 4,609,026 4,652,620
---------- ---------- ----------- -----------
Net income per common and common
equivalent share............... $.04 $.10 $.15 $.24
========== ========== =========== ===========
</TABLE>
See notes to unaudited consolidated financial statements.
3
<PAGE>
GAMMA BIOLOGICALS, INC.
Statements of Consolidated Changes in Shareholders' Equity
(Unaudited)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
------------------------------------------------------
DECEMBER 31,
------------------------------------------------------
1995 1994
-------------------------- --------------------------
SHARES AMOUNT SHARES AMOUNT
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
COMMON STOCK
Balance, beginning of period.... 4,700,303 $ 470,030 4,700,078 $ 470,008
Exercise of stock options....... 10,937 1,094 100 10
--------- ----------- --------- -----------
Balance, end of period.......... 4,711,240 471,124 4,700,178 470,018
--------- ----------- --------- -----------
CAPITAL IN EXCESS OF PAR
Balance, beginning of period.... 13,482,615 13,481,763
Exercise of stock options....... 29,639 270
--------- ----------- --------- -----------
Balance, end of period.......... 13,512,254 13,482,033
--------- ----------- --------- -----------
RETAINED EARNINGS
Balance, beginning of period.... 3,619,289 2,609,496
Net income...................... 691,519 1,147,974
Dividends declared.............. (340,958) (343,198)
--------- ----------- --------- -----------
Balance, end of period.......... 3,969,850 3,414,272
--------- ----------- --------- -----------
UNREALIZED INVESTMENT LOSS
Balance, beginning of period.... (87,683)
Current period unrealized loss.. (6,097)
--------- ----------- --------- -----------
Balance, end of period.......... (93,780)
--------- ----------- --------- -----------
TREASURY STOCK
Balance, beginning of period.... (159,169) (1,118,258) (99,952) (853,469)
Purchase of treasury stock...... (394) (1,650) (57,717) (258,976)
-------- ---------- --------- -----------
Balance, end of period.......... (159,563) (1,119,908) (157,669) (1,112,445)
--------- ----------- --------- -----------
TOTAL SHAREHOLDERS' EQUITY........ 4,551,677 $16,833,320 4,542,509 $16,160,098
========= =========== ========= ===========
</TABLE>
See notes to unaudited consolidated financial statements.
4
<PAGE>
GAMMA BIOLOGICALS, INC.
Statements of Consolidated Cash Flows
(Unaudited)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
------------------------------
DECEMBER 31,
------------------------------
1995 1994
-------------- --------------
[INCREASE (DECREASE) IN CASH]
<S> <C> <C>
Cash flows from operating activities:
Cash received from customers.......... $ 13,135,395 $ 13,164,258
Interest received..................... 103,857 96,476
Cash paid to suppliers and employees.. (11,476,576) (12,043,240)
Interest paid......................... (35,345) (51,274)
Income taxes paid..................... (325,000) (477,000)
------------ ------------
Net cash provided by operating
activities........................... 1,402,331 689,220
------------ ------------
Cash flows from investing activities:
Property additions.................... (1,185,692) (785,875)
Increase in cash value of life
insurance............................ (132,565) (114,218)
Purchase of investments............... (920,702) (986,437)
Proceeds from investments............. 2,065,615 80,155
Proceeds from sale of equipment....... 9,245 37,085
------------ ------------
Net cash used in investing activities. (164,099) (1,769,290)
------------ ------------
Cash flows from financing activities:
Payments on long-term obligations..... (143,927) (158,559)
Exercise of stock options............. 30,733 280
Purchase of treasury stock............ (1,650) (258,976)
Dividends paid........................ (340,737) (344,566)
------------ ------------
Net cash used in financing activities. (455,581) (761,821)
------------ ------------
Net increase (decrease) in cash......... 782,651 (1,841,891)
Cash and cash equivalents at beginning
of period.............................. 1,795,854 3,175,265
------------ ------------
Cash and cash equivalents at end of
period................................. $ 2,578,505 $ 1,333,374
============ ============
</TABLE>
5
<PAGE>
GAMMA BIOLOGICALS, INC.
Statements of Consolidated Cash Flows
(Unaudited)
Reconciliation of Net Income to
Net Cash Provided by Operating Activities
<TABLE>
<CAPTION>
NINE MONTHS ENDED
--------------------------
DECEMBER 31,
--------------------------
1995 1994
------------ ------------
<S> <C> <C>
Net Income $ 691,519 $1,147,974
Adjustments to reconcile net income to
cash provided by operating activities:
Depreciation....................... 484,628 393,650
Amortization of goodwill........... 110,275
(Gain) loss on sale of fixed assets (7) 69,539
(Increase) decrease in accounts
receivable........................ 557,458 (186,054)
Gain on sale of investments........ (162,181) (83,441)
(Increase) decrease in inventory... 30,528 (170,283)
Increase in prepaid expenses....... (19,458) (141,811)
(Increase) decrease in other assets 49,050 (98,138)
Decrease in accounts payable....... (79,914) (24,779)
Decrease in accrued salaries and
other expenses.................... (149,292) (327,712)
---------- ----------
Net Cash Provided by
Operating Activities.................. $1,402,331 $ 689,220
========== ==========
</TABLE>
Supplemental Schedule of Non-Cash Investing and Financing Activities:
The company entered into various capital leases for new equipment, which
increased the company's property and long-term debt by $119,389 in 1994.
See notes to unaudited consolidated financial statements.
6
<PAGE>
GAMMA BIOLOGICALS, INC.
Notes to Consolidated Financial Statements
(Unaudited)
1. Reconciliation of statutory rate with effective United States income tax
rate:
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
------------------ ------------------
DECEMBER 31, DECEMBER 31,
------------------ ------------------
1995 1994 1995 1994
------ ------ ----- -----
<S> <C> <C> <C> <C>
Statutory rate.............. 34.0% 34.0% 34.0% 34.0%
Increase (decrease)
resulting from:
Exempt export earnings... (.8) (7.5) (3.7) (2.8)
Tax credits.............. (14.7) (5.3)
Amortization of goodwill. 2.1 2.3
Reduction of taxes
provided in prior years. (8.4) (1.8)
Valuation of temporary
differences............. (12.4) 2.0 (3.8) .6
Other-net................ 3.1 2.1 2.0 1.1
------ ----- ----- ----
Effective tax rate.......... 15.5% 18.0% 26.7% 29.9%
====== ===== ===== ====
</TABLE>
The provision for deferred income taxes is based on the liability method
prescribed by SFAS No. 109, "Accounting for Income Taxes", which was adopted
by the company during the first quarter of 1994. A deferred income tax
liability or asset is recognized for temporary differences between the tax
basis of assets and liabilities and their reported amounts in the financial
statements that will result in net taxable or deductible amounts in future
years. Significant components of the company's deferred tax assets
(liabilities) are as follows:
<TABLE>
<CAPTION>
DECEMBER 31, 1995 MARCH 31, 1995
------------------ --------------
<S> <C> <C>
Allowance for bad debts............... $ 62,400 $ 68,600
Inventory costs capitalized........... 57,600 50,800
Other................................. 5,000
---------- ----------
Net current deferred tax asset..... 120,000 124,400
---------- ----------
Difference between book and tax basis
of property, plant and equipment..... (218,300) (254,000)
Other................................. (26,100) (8,600)
---------- ----------
Net noncurrent deferred tax
liability......................... (244,400) (262,600)
---------- ----------
Net deferred tax liability............ $ (124,400) $ (138,200)
========== ==========
</TABLE>
2. Net income per common and common equivalent share is computed using weighted
average number of shares and dilutive equivalent shares outstanding during
each period. The weighted average number of shares for the three month period
ended December 31 was 4,613,352 in 1995 and 4,632,479 in 1994; for the nine
month period then ended, 4,609,026 in 1995 and 4,652,620 in 1994.
7
<PAGE>
3. Inventories are valued at the lower of cost or market value, based on the
cost method summarized below:
<TABLE>
<CAPTION>
DECEMBER 31, 1995 MARCH 31, 1995
----------------- --------------
<S> <C> <C>
First-in, first out:
Finished products............ $1,480,516 $1,540,278
Products in process.......... 478,652 650,443
---------- ----------
1,959,168 2,190,721
---------- ----------
Specific identification:
Raw material................. 922,340 840,289
Finished instrument systems.. 3,079 3,648
---------- ----------
925,419 843,937
---------- ----------
Average:
Supplies..................... 892,380 772,837
---------- ----------
Total..................... $3,776,967 $3,807,495
========== ==========
</TABLE>
4. INVESTMENTS
The COMPANY ADOPTED SFAS NO. 115, "ACCOUNTING FOR CERTAIN INVESTMENTS IN DEBT
AND EQUITY SECURITIES" IN 1994. IN ACCORDANCE WITH THIS STATEMENT, THE
COMPANY CLASSIFIED ITS INVESTMENT IN EQUITY SECURITIES AS "AVAILABLE FOR
SALE", WHICH WAS REPORTED AT FAIR VALUE. UNREALIZED HOLDING GAINS AND LOSSES
ARE REPORTED IN A SEPARATE COMPONENT OF SHAREHOLDERS' EQUITY UNTIL REALIZED.
THESE SECURITIES WERE SOLD IN AUGUST 1995. THE COMPANY HAS THE POSITIVE
INTENT AND ABILITY TO HOLD ITS INVESTMENTS IN DEBT SECURITIES TO MATURITY;
THESE INVESTMENTS ARE REPORTED AT AMORTIZED COST. INVESTMENTS IN DEBT AND
EQUITY SECURITIES ARE SUMMARIZED AS FOLLOWS:
<TABLE>
<CAPTION>
UNREALIZED CARRYING
TYPE CLASSIFICATION FAIR VALUE GAIN (LOSS) VALUE
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Nine months ended December 31, 1995
Debt securities:
U.S. Government:
Treasury Notes - due 3/31/96 Held to maturity $ 999,690 $ 1,367 $ 998,323
Certificates of Deposit - due 3/11/96 Held to maturity 100,000 100,000
----------------------------------------
Total debt securities 1,099,690 1,367 1,098,323
----------------------------------------
Total investments $1,099,690 $ 1,367 $1,098,323
========================================
Nine months ended December 31, 1994
Equity securities:
Common stock Available for sale $ 8,528 $ 8,528
Debt securities:
U.S. Government:
Federal Home Loan Banks - due 3/27/95 Held to maturity 1,000,310 $ (2,772) 1,003,082
Treasury Notes - due 3/31/96 Held to maturity 971,880 (19,734) 991,614
Federal Farm Credit Banks - due 9/1/95 Held to maturity 992,190 (8,749) 1,000,939
Certificates of Deposit - due 3/13/95 Held to maturity 100,000 100,000
----------------------------------------
Total debt securities 3,064,380 (31,255) 3,095,635
----------------------------------------
Total investments $3,072,908 $(31,255) $3,104,163
========================================
</TABLE>
8
<PAGE>
5. In the opinion of management, the unaudited consolidated condensed financial
statements for Gamma Biologicals, Inc. (the "company") includes all
adjustments (consisting solely of normal recurring adjustments) necessary for
a fair presentation of the financial position of the company as of December
31, 1995, the results of operations of the three and nine month periods ended
December 31, 1995 and 1994 and cash flows for the nine month periods ended
December 31, 1995 and 1994. Although management believes the disclosures in
these financial statements are adequate to make the information presented not
misleading, certain information and footnote disclosures normally included in
annual financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to the rules
and regulations of the Securities and Exchange Commission. The results of
operations for the periods ended December 31, 1995 are not necessarily
indicative of the results to be expected for the full year.
6. LONG-TERM OBLIGATIONS
Long-term obligations consist of:
<TABLE>
<CAPTION>
DECEMBER 31, 1995 MARCH 31, 1995
----------------- --------------
<S> <C> <C>
Mortgage note, due monthly through
2000................................. $450,785 $508,434
Other obligations..................... 27,297 113,575
-------- --------
478,082 622,009
Less current portion............... 104,830 602,746
-------- --------
Total long-term obligations........... $373,252 $ 19,263
======== ========
</TABLE>
The mortgage note bears interest at the bank's base rate, but not less than
7% nor more than 13%. At December 31, 1995, the note bore interest at 9.50%.
The mortgage note is collaterized by a first lien on the company's land and
building. In November 1995, the note was extended through November 2000 with
no significant changes in terms or conditions.
7. SALES BY GEOGRAPHIC AREA
The company operates within one dominant segment - the manufacture and sale
of blood bank and diagnostic products - and has no customer which accounts
for 10% or more of its total sales. The company operates in one geographic
area, the United States, from which it sells to numerous countries.
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
--------------------------- ----------------------------
DECEMBER 31, DECEMBER 31,
--------------------------- ----------------------------
1995 1994 1995 1994
------------- ------------ ------------- -------------
<S> <C> <C> <C> <C>
Net sales to unaffiliated customers:
United States....................... $3,038,354 $3,634,873 $ 9,175,611 $ 9,856,917
Europe.............................. 423,014 367,453 1,194,482 1,233,925
Pacific Region...................... 323,945 323,069 931,755 955,098
Mexico, Central and South America... 243,038 213,276 649,782 695,304
Middle East......................... 114,701 140,977 482,887 437,539
Other............................... 59,365 93,588 187,698 238,318
---------- ---------- ----------- -----------
Total.............................. $4,202,417 $4,773,236 $12,622,215 $13,417,101
========== ========== =========== ===========
</TABLE>
9
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
- ---------------------
THREE MONTHS ENDED DECEMBER 31, 1995
- ------------------------------------
Net sales for the three months ended December 31, 1995 fell $570,000 compared
with the same period in 1994. This decline is due wholly to non-recurring sales
of reagent red cell, serum and RQC products to another domestic reagent
manufacturer which benefitted the 1994 period.
Gross margin as a percentage of sales held to 52% in 1995, down from 53% in
1994, in spite of the loss of more favorable pricing and above-average
production levels related to the windfall reagent red cell and RQC sales. The
impact was minimized by the positive effect of reduced travel and personnel
expenses related to discontinued STS-M service contracts, combined with
decreased sales of lower-margin STS-M disposables and the contribution of
higher-margin SegmentSampler(Trademark) sales.
Selling expenses remained relatively constant with the prior period. General
and administrative expenses increased 8%, due primarily to increased insurance
coverage and to travel expense associated with the company's evaluation of
potential manufacturing sites outside the United States. Shipping and warehouse
expenses increased 9% compared with the same period in 1994 due to increased
staffing and depreciation expense related to the first phase of the bar coding
system installed in March 1995. The bar coding system, nearing completion, is
expected to provide significant long-term benefits to the shipping, warehousing
and manufacturing functions.
Research and development expenses increased 17% in 1995 due to costs
associated with the ongoing electro-biosensor research and development and field
testing costs for the ReACT project.
Net other income and expense improved in the current period over the prior
period, which bore the affect of losses on the disposal of obsolete computer
equipment in connection with the installation of a network system.
The provision for income taxes fell in 1995 due to lower pretax earnings.
NINE MONTHS ENDED DECEMBER 31, 1995
- -----------------------------------
Net income for the nine months ended December 31, 1995 dropped 40% compared
with the same period in 1994. This decline can be attributed to the 1994
benefit realized from the non-recurring reagent red cell, serum and RQC sales to
another domestic reagent manufacturer and the increases in operating expenses
outlined above for the three month period ended December 31, 1995.
10
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
Net cash flows increased approximately $2,625,000 during the nine month period
ended December 31, 1995 compared with the same period in 1994. Operating cash
flows improved by $713,000 due to reduced inventory purchases, the absence of
payments of license fees that affected 1994 operating cash flows, and lower
income tax payments. A $400,000 increase in capital expenditures for
manufacturing modernization partially offset the gains in operating cash flows.
Additional cash flow gains resulted from $1,985,000 in investment maturation and
the curtailment of stock repurchases for $257,000 in 1994. Management expects
that capital expenditures will continue to be higher than usual for the next 12
months to complete all planned improvements. Management also believes that
operating cash flows will be sufficient to meet future operating needs.
During the current period, we took delivery of the first production lot of
ReACT microcolumn incubators and expect delivery of the centrifuges in the
fourth quarter. These products should be available for sale internationally in
mid-1996. Field studies are proceeding to collect data for submission to the FDA
for licensure. We continue to evaluate potential manufacturing sites outside
the United States, since FDA approval to market ReACT in the United States may
take as long as two years. Regarding electro-biosensor research, additional
funding of $155,000 was provided to one of the research centers in the current
quarter and an additional commitment of $185,000 was made to fund the project
through fiscal 1997.
The company's existing capital resources, consisting of $3,700,000 in cash and
short-term investments and a $1,500,000 revolving credit line, should be
sufficient to support planned product development and capital improvements
during the next 12 months.
11
<PAGE>
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits, Part II
(27) Article 5 Financial Data Schedule
(b) Reports on Form 8-K - None
12
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed in its behalf by the
undersigned thereunto duly authorized.
GAMMA BIOLOGICALS, INC.
February 13, 1996 By: /s/ John J. Moulds
-------------------------------
John J. Moulds
President
(Chief Operating Officer)
February 13, 1996 By: /s/ Margaret J. O'Bannion
--------------------------
Margaret J. O'Bannion
Vice President - Finance
(Chief Financial Officer)
13
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM CONSOLIDATED
BALANCE SHEETS AND STATEMENTS OF CONSOLIDATED INCOME AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> MAR-31-1996
<PERIOD-END> DEC-31-1995
<CASH> 2,578,505
<SECURITIES> 1,098,323
<RECEIVABLES> 3,626,496
<ALLOWANCES> 183,548
<INVENTORY> 3,776,967
<CURRENT-ASSETS> 11,541,940
<PP&E> 10,422,988
<DEPRECIATION> 5,532,007
<TOTAL-ASSETS> 18,386,240
<CURRENT-LIABILITIES> 935,268
<BONDS> 373,252
471,124
0
<COMMON> 0
<OTHER-SE> 16,833,320
<TOTAL-LIABILITY-AND-EQUITY> 18,386,240
<SALES> 12,622,215
<TOTAL-REVENUES> 12,622,215
<CGS> 5,842,063
<TOTAL-COSTS> 4,268,120
<OTHER-EXPENSES> 1,710,988
<LOSS-PROVISION> 44,279
<INTEREST-EXPENSE> 35,345
<INCOME-PRETAX> 943,319
<INCOME-TAX> 251,800
<INCOME-CONTINUING> 691,519
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 691,519
<EPS-PRIMARY> .15
<EPS-DILUTED> .15
</TABLE>
