<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For Quarter Ended September 30, 1995 Commission File Number 0-5206
------------------ ------
EMONS TRANSPORTATION GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware 23-2441662
--------------------------------------------------
(State of Incorporation) (I.R.S. Employer Identification No.)
96 South George Street, York, Pennsylvania 17401 (717-771-1700)
- - ----------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code) (Telephone No.)
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 by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15 (d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
Yes X No
--- ---
The number of shares of each class of common stock of the registrant
issued and outstanding as at September 30, 1995 is as follows:
Voting Common Stock 5,677,972
---------
<PAGE>
EMONS TRANSPORTATION GROUP, INC.
CONSOLIDATED BALANCE SHEETS
(unaudited)
<TABLE>
<CAPTION>
September 30, June 30,
1995 1995
------------- ------------
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents $ 1,315,830 $ 1,232,859
Accounts Receivable, net 2,226,463 1,770,681
Materials and supplies 226,704 359,385
Prepaid expenses 224,055 285,436
Deferred income taxes 50,000 50,000
------------ ------------
Total current assets 4,043,052 3,698,361
------------ ------------
Property, plant and equipment 25,609,849 24,234,733
Less accumulated depreciation (7,833,619) (7,549,786)
------------ ------------
17,776,230 16,684,947
Deferred expenses and other assets 319,413 362,267
------------ ------------
TOTAL ASSETS $ 22,138,695 $ 20,745,575
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Current portion of long-term debt $ 964,531 $ 818,813
Accounts payable 1,433,656 708,234
Accrued payroll and related expenses 951,183 849,867
Income taxes payable 75,793 88,573
Other accrued expenses 1,232,421 1,228,765
------------ ------------
Total current liabilities 4,657,584 3,694,252
------------ ------------
Long-term debt (Note 3) 10,184,961 10,043,285
Other liabilities 574,123 601,722
Deferred income taxes 1,380,000 1,290,000
------------ ------------
Total Liabilities 16,796,668 15,629,259
------------ ------------
Stockholders' Equity:
Cumulative convertible preferred stock 17,177 17,270
Common stock 56,780 56,696
Additional paid-in capital 23,289,874 23,289,866
Deficit (17,814,761) (18,032,415)
------------ ------------
5,549,070 5,331,417
Unearned compensation - restricted stock
awards (207,043) (215,101)
------------ ------------
Total Stockholders' Equity 5,342,027 5,116,316
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 22,138,695 $ 20,745,575
============ ============
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
EMONS TRANSPORTATION GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended
September 30,
-----------------------------------------
1995 1994
------------- -------------
<S> <C> <C>
Operating revenues $ 3,686,403 $ 3,151,468
Operating expenses:
Cost of operations 2,485,693 2,190,859
Selling and administrative 657,867 540,472
------------- -------------
3,143,560 2,731,331
------------- -------------
Income from operations 542,843 420,137
Other income (expense):
Interest income 18,222 13,979
Interest expense (271,181) (262,376)
Other, net 58,770 3,595
------------- -------------
(194,189) (244,802)
------------- -------------
Income before income taxes 348,654 175,335
Provision for income taxes 131,000 53,450
------------- -------------
Net income 217,654 121,885
Preferred dividend requirements 60,119 60,445
------------- -------------
Income applicable to common shareholders $ 157,535 $ 61,440
============= =============
Average common shares and common
share equivalents (Note 2) 6,074,527 5,782,936
============= =============
Earnings per common share and
common share equivalent (Note 2) $ 0.03 $ 0.01
============= =============
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
EMONS TRANSPORTATION GROUP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended
September 30,
-----------------------------
1995 1994
------------ -----------
<S> <C> <C>
Cash flow from operating activities:
Net income $ 217,654 $ 121,885
Adjustments to reconcile net income to net
cash provided by operating activities
Depreciation 283,833 258,288
Amortization of deferred expenses 23,687 17,930
Amortization of deferred compensation 8,057 8,427
Gain on sale of assets (58,770) (3,595)
Increase in accounts receivable, materials
and supplies and prepaid expenses (261,720) (337,391)
Increase in accounts payable, accrued
expenses and other liabilities 790,015 280,730
Increase in deferred income taxes 90,000 40,000
----------- -----------
Net cash provided by operating activities 1,092,756 386,274
----------- -----------
Cash flow from investing activities:
Proceeds from sale of assets 66,310 7,563
Additions to property, plant and equipment (1,382,656) (419,062)
(Increase) decrease in deferred expenses and other assets 19,167 (29,926)
----------- -----------
Net cash used in investing activities (1,297,179) (441,425)
----------- -----------
Cash flow from financing activities:
Proceeds from issuance of long-term debt 418,796 10,690
Reduction in long-term debt (131,402) (161,946)
----------- -----------
Net cash provided by (used in) financing activities 287,394 (151,256)
----------- -----------
Net increase (decrease) in cash and cash equivalents 82,971 (206,407)
Cash and cash equivalents at beginning of period 1,232,859 1,565,163
----------- -----------
Cash and cash equivalents at end of period $ 1,315,830 $ 1,358,756
=========== ===========
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
EMONS TRANSPORTATION GROUP, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the Three Months Ended September 30, 1995
(unaudited)
Note l. The information furnished herein has been prepared accordance with
generally accepted accounting principles. In the opinion of the
management of Emons Transportation Group, Inc. (the "Company" or "Emons
Transportation Group"), all adjustments (which include only normal
recurring adjustments) considered necessary to present a fair statement
of the results for the periods covered by this report have been made.
Note 2. Earnings per common share are computed by dividing net earnings by the
weighted average number of common shares and common share equivalents
for the period. Earnings per common share for the three month periods
ended September 30, 1995 and 1994 do not include conversion of
convertible preferred stock because the effect of such inclusion would
be anti-dilutive.
Note 3. In December 1994, the Company executed a $750,000 Senior Secured Term
Loan with a local bank through one of its railroad subsidiaries. Under
the terms of the Loan Agreement, the Company may borrow up to $750,000
through March 1, 1996, at which time the principal amount borrowed is
repayable in increasing quarterly installments over five years from
June 1, 1996 through March 1, 2001. On August 31, 1995 the Company
borrowed $200,000 under this loan to finance the acquisition of land
and construction of a new logistics lumber transload and storage
facility in York, PA. In addition, the seller of the land issued a note
in the amount of $170,000, which bears interest at a rate of 10% per
annum and is repayable in three equal annual installments commencing
August 1996.
Note 4. Emons Transportation Group is not currently a party to any legal
proceedings. However, Emons Industries ("Industries"), a subsidiary of
the Company, is currently a defendant in 481 product liability actions.
The Company is in the process of cleaning up a fuel oil leak at its
locomotive maintenance facility in York, Pennsylvania.
Product Liability Actions
Prior to March 1971, under previous management, Industries (then known
as Amfre-Grant, Inc.) was engaged in the business of distributing (but
not manufacturing) various generic and prescription drugs. Industries
sold and discontinued these business activities in March 1971 and
commenced its railcar leasing and railroad
<PAGE>
operations in October 1971. One of the drugs which had been distributed
was diethylstilbestrol ("DES"), which was taken by women during
pregnancy to prevent miscarriage.
As of November 6, 1995, Industries was one of numerous defendants
(including many of the largest pharmaceutical manufacturers) in 481
lawsuits in which the plaintiffs allege that DES caused adenosis,
infertility, cancer or birth defects in the offspring or grandchildren
of women who ingested DES during pregnancy. In these actions, liability
is premised on the defendant's participation in the market for DES, and
liability is several and limited to the defendant's share of the
market. Of these lawsuits, 475 were commenced after the confirmation of
Industries' Reorganization Plan in December 1986 (the "Plan"), while
the remaining 6 lawsuits are claims which will be treated under the
Plan. These actions are currently in various stages of litigation.
In January 1994, a jury in New York State Court rendered awards in 11
consolidated cases (only 7 of which were against Industries) in which
the issue of damages was tried prior to the establishment of liability
and causation by plaintiffs. Industries' potential liability in these
cases ranges from approximately $4,000 to $70,000, for a total of
approximately $260,000. Of this amount, approximately $62,000 would be
paid by Industries' insurer. Industries' appeal from the jury awards to
the intermediate appellate court was denied. No further appeal on the
damage issue is possible until after the trial for the liability and
causation issues scheduled for November 1995. Industries believes that
it has substantial defenses to the liability and causation issues.
Industries has filed a motion in Bankruptcy Court seeking a judgment
declaring that the 475 post-confirmation lawsuits represent claims
which should be asserted against Industries' Chapter 11 estate and are
not post-reorganization liabilities. Counsel has advised the Company
that the Bankruptcy Court should grant Industries' application to
classify all of these cases as bankruptcy claims. In addition, on
February 14, 1995, the Bankruptcy Court advised Industries that it
would sign an order which would stay execution of any judgment rendered
against Industries pending determination of Industries' application.
The order, which was submitted to the Court in March 1995, has not yet
been signed.
Industries has product liability insurance and defense coverage for
nearly all the claims which fall within the policy period 1948 to 1970
up to varying limits by
<PAGE>
individual and in the aggregate for each policy year. To date,
Industries has not exhausted coverage in any policy year. During the
quarter ended September 30, 1995, 19 lawsuits were settled or dismissed
at no material liability to Industries.
Management intends to vigorously defend all of these actions. In the
event that the post-reorganization lawsuits described above are not
treated under the Plan, it is possible that Industries' could
ultimately have liability in these actions in excess of its product
liability insurance coverage described above. However, based on
Industries' experience in prior DES litigation and its current
knowledge of pending cases, the Company believes that it is unlikely
that Industries' ultimate liability, if any, in excess of insurance
coverage and existing reserves in the pending cases will be in an
amount sufficient to have a material adverse effect upon the Company's
consolidated financial position or results of operations.
Environmental Liability
-----------------------
During fiscal 1994, the Company discovered a diesel fuel oil leak at
its locomotive maintenance facility in York, Pennsylvania resulting
from the fueling of its locomotives. The Company is currently working
with the Pennsylvania Department of Environmental Protection to clean
up the contaminated area. Based upon information currently available,
the Company believes it has provided adequate reserves as of September
30, 1995 for the estimated clean up costs.
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS
- - ------------------------------------
Liquidity and Capital Resources
The Company's primary sources of liquidity include its cash and accounts
receivable, which aggregated $3,542,000 and $3,004,000 at September 30, 1995 and
June 30, 1995, respectively, and the balance available under a $750,000 Senior
Secured Term Loan issued by a local bank to a subsidiary. Under the terms of
the Loan Agreement, the Company may borrow up to $750,000 through March 1, 1996,
at which time the principal amount borrowed is repayable over a five year
period. In August 1995, the Company borrowed $200,000 under this loan to
finance the acquisition of land and construction of a new logistics lumber
transload and storage facility in York, PA to accommodate a new customer. The
Company intends to use the balance remaining under this facility to finance
other projects to generate additional business and to fund capital track
rehabilitation projects as needed.
The Company's cash and cash equivalents increased by $83,000 for the three
month period ended September 30, 1995. The net increase includes $1,093,000 of
cash provided by operations, $66,000 proceeds from the sale of land, and
$287,000 additional net borrowings, partially offset by $1,383,000 of capital
investments.
The Company generated $1,093,000 of cash from operations for the three
month period ended September 30, 1995 as compared to $386,000 for the
corresponding period in the prior year. Excluding working capital items and
other liabilities, cash provided by operations increased by $122,000 from
$443,000 for the three months ended September 30, 1994 to $565,000 for the three
months ended September 30, 1995. This increase is primarily attributable to an
improvement in operating results during the current year which is reflected by
an increase in income from operations of $123,000.
Cash provided by working capital items and other liabilities totaled
$528,000 for the three months ended September 30, 1995, consisting principally
of a $725,000 increase in accounts payable and a $133,000 decrease in materials
and supplies, partially offset by a $456,000 increase in accounts receivable.
The increase in accounts payable is attributable to $1,383,000 of capital
expenditures during the quarter, discussed further below, while the decrease in
materials and supplies is attributable to the use of these items in capital
track projects. The increase in accounts receivable is primarily attributable
to a 17% increase in operating revenues over the prior year, additional
receivables from the State of Pennsylvania under government funded track
rehabilitation programs, and receivables generated from land sales.
The Company invested $1,383,000 in capital expenditures during the three
months ended September 30, 1995. Expenditures include $883,000 of investments
in railroad track structures (net
<PAGE>
of $247,000 of government grants) in connection with the Company's continuing
extensive track rehabilitation program, $254,000 for the purchase of land and
$110,000 of land improvements in connection with the construction of a logistics
lumber transload and storage facility in York, PA to accommodate a new customer,
and $57,000 of investments in computer equipment in connection with a computer
systems upgrade project. As of September 30, 1995, the Company has available in
excess of $1.7 million of government grants and in excess of $300,000 of
government funding under a no interest loan program for track rehabilitation
projects encompassing all three of its railroads.
The Company's net long-term debt obligations increased by $287,000 during
the three month period ended September 30, 1995, including $131,000 of scheduled
debt repayments offset by $418,000 of additional borrowings. Additional
borrowings include $170,000 of seller financing and $200,000 of borrowings under
the $750,000 Senior Secured Term Loan to fund the acquisition of land and
construction of the new logistics lumber transfer and storage facility, and
$48,000 of equipment loans.
Analysis of Operations for the three months ended September 30,
1995 compared to the three months ended September 30, 1994
Results of Operations
The Company generated net income of $218,000 for the three month period
ended September 30, 1995 as compared to net income of $122,000 for the three
month period ended September 30, 1994. The net increase of $96,000 includes an
increase in operating revenues of $535,000 and an increase in non-operating
income of $55,000, partially offset by an increase in operating expenses of
$413,000 and an increase in the provision for income taxes of $78,000.
Revenues
Operating revenues increased $535,000, or 17%, from $3,151,000 for the
three months ended September 30, 1994 to $3,686,000 for the corresponding period
in the current year. This increase includes $126,000 additional freight and
haulage revenues (excluding intermodal haulage revenues), $229,000 additional
revenues generated by the Company's intermodal business, and $180,000 net
additional other operating revenues.
Freight and haulage revenues increased by $126,000, or 5%, as a result of a
5% corresponding increase in the number of carloads handled. The total number
of carloads handled increased approximately 450 carloads from 8,250 for the
three months ended September 30, 1994 to 8,700 for the three months ended
September 30, 1995. The net increase includes 335 additional coal carloads
(three coal trains) on the railroad operations in York, PA, 210 additional
carloads generated by the Company's logistics
<PAGE>
operations in York, PA including the addition of a new lumber customer, 270
additional paper related carloads on the St. Lawrence & Atlantic Railroad
("SLR") due to industry conditions and marketing efforts, and a variety of less
significant increases in other business. These increases were partially offset
by 220 less salt carloads on SLR due to timing of these shipments, 120 less
carloads to a paper manufacturer served by the railroad operations in York, PA
as a result of a slowdown in business, and a variety of other less significant
decreases.
The Company's rail intermodal terminal, which commenced operations on SLR
in late September 1994, generated $237,000 of freight and intermodal handling
revenues during the quarter ended September 30, 1995 as compared to $9,000 for
the short period of operations in the prior year. The terminal handled
approximately 2,260 trailers and containers during the three month period ended
September 30, 1995, and this business has steadily increased over the past year
since operations commenced.
Total logistics revenues generated by the Company's operations in York, PA
increased slightly (approximately 1%), despite a 210 unit increase in the number
of carloads handled, due to mix of business. A new Canadian forest products
customer accounted for approximately 100 carloads of this increase.
The $180,000 increase in other operating revenues over the prior year
includes a $89,000 increase in demurrage revenues and a variety of other less
significant increases.
Other non-operating revenues increased $55,000 over the prior year as a
result of a gain on the sale of a parcel of land in York, PA of approximately
$60,000.
Expenses
Operating expenses increased $413,000, or 15%, from $2,731,000 for the
three month period September 30, 1994 to $3,144,000 for the three month period
ended September 30, 1995. The increase consists of $295,000 additional cost of
operations and $118,000 additional selling and administrative expenses.
Cost of operations increased $295,000 from $2,191,000 for the three month
period ended September 30, 1994 to $2,486,000 for the corresponding period in
the current year. The increase includes $200,000 additional railroad operating
expenses, $11,000 additional logistics operating expenses, and $84,000
additional intermodal operating expenses as a result of a full quarter of
operations in the current year versus five days of operations in the prior year.
The increase in railroad operating expenses includes additional
transportation costs to operate the dedicated intermodal train on the SLR for a
full quarter in the current year and three additional coal trains on the
railroad operations in York, PA in the current year, as well as a net increase
in
<PAGE>
other railroad operating expenses as a result of the increase in business.
Logistics operating expenses increased $11,000, including $32,000 of one
time expenses incurred in the relocation of a warehouse operation in York, PA.
Excluding the relocation costs, logistics operating expenses decreased $21,000
due to the mix of logistics services provided to customers.
Selling and administrative expenses increased $118,000, or 22%, from
$540,000 for the quarter ended September 30, 1994 to $658,000 for the quarter
ended September 30, 1995. This increase includes $46,000 of intermodal sales
and administrative expenses in the current year as compared to no such expenses
in the prior year, a provision for profit sharing and incentive compensation
expense due to favorable operating results in the current year, and a net
increase in a variety of other expenses.
Interest expense increased $9,000 for the three month period ended
September 30, 1995 as compared to the corresponding period in the prior year due
to a modest increase in the average debt balance outstanding resulting from
additional borrowings.
The provision for income taxes increased $78,000 from $53,000 for the
quarter ended September 30, 1994 to $131,000 for the quarter ended September 30,
1995. The increase includes additional current state income tax expense as a
result of the $173,000 increase in income before income taxes, and additional
deferred state and federal income tax liabilities associated with depreciation
of the Company's railroad track structures.
<PAGE>
PART II.
Item l. Legal Proceedings
As previously reported in Item 3 of the Emons Transportation Group, Inc.
Annual Report on Form 10-K for the fiscal year ended June 30, 1995 in which
reference is hereby made, Emons Transportation Group, Inc. is not currently a
party to any legal proceedings. However, Emons Industries, Inc. is currently a
defendant in approximately 481 product liability actions.
Item 3. Default Upon Senior Securities
On November 16, 1994 and June 23, 1995, the Board of Directors voted to
omit the regular semi-annual dividend of $0.07 per share on its $0.14 Cumulative
Convertible Preferred Stock which would have been payable on January 2, 1995 and
July 3, 1995, respectively. Dividends in arrears as of the date of this report
aggregated $1,202,387.
Item 4. Any Submission of Matters to a Vote of Security Holders
No matters were submitted to a vote of security holders during the three
month period ended September 30, 1995.
Item 6. Exhibit and Reports on Form 8-K
(a) An index to exhibits appears following the signature
page to this report.
(b) No reports on Form 8-K were filed during the three
month period ended September 30, 1995.
<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.
EMONS TRANSPORTATION GROUP, INC.
Date:November 10, 1995 By:/s/Scott F. Ziegler
----------------- -------------------
Scott F. Ziegler
Vice President, Controller
(signing on behalf of the
registrant as both its duly
authorized officer and its
chief accounting officer)
<PAGE>
Exhibits
The following exhibits are filed as a part of this report. For convenience of
reference, exhibits are listed according to numbers assigned in the Exhibit
Table of Item 601 of Regulation S-K under the Securities Exchange Act of 1934.
<TABLE>
<CAPTION>
Page in
Exhibit Sequentially
Number Exhibit Numbered Copy
<S> <C> <C>
3 (a) Certificate of Incorporation for Emons Transportation,
Group, Inc. dated December 19, 1986 (incorporated by
reference from Emons Transportation Group, Inc.
Report on Form 10-K for the year ended
June 30, 1987) --
3 (b) Certificate of Amendment of Certificate of
Incorporation of Emons Transportation Group, Inc.
dated September 26, 1989 (incorporated by reference
from Emons Transportation Group, Inc. Report on
Form 10-Q for the quarter ended September 30, 1989) --
3 (c) Amended and Restated By-Laws for Emons
Transportation Group, Inc. (incorporated by
reference from Emons Transportation Group, Inc.
Report on Form 10-Q for the quarter ended
September 30, 1989) --
3 (d) Certificate of Amendment of Certificate of
Incorporation of Emons Transportation Group, Inc.
dated November 18, 1993 (incorporated by reference
from Emons Transportation Group, Inc. Report
on Form 10-Q for the quarter ended December 31, 1993) --
11 (a) Earnings per share calculation 15
27 (a) Article 5 of Regulation S-X, Financial Data
Schedules --
</TABLE>
<PAGE>
Exhibit 11 (a)
EMONS TRANSPORTATION GROUP, INC.
EARNINGS PER SHARE CALCULATION
<TABLE>
<CAPTION>
Fully
Primary Diluted
EPS EPS
------- -------
<S> <C> <C>
Three Months Ended September 30, 1995
- - -------------------------------------
A. Average number of common shares outstanding 5,675,075 5,675,075
B. Average number of common share equivalents
assuming conversion of options (calculated
using the treasury method) 399,452 428,692
C. Average number of common share equivalents
assuming conversion of convertible preferred stock 1,551,358 1,551,358
D. Total average common share and common share
equivalents 7,625,885 7,655,125
E. Net earnings $ 217,654 $ 217,654
F. Preferred dividend requirements 60,119 60,119
G. Earnings (loss) applicable to common stock 157,535 157,535
H. Earnings (loss) per share - no conversion (G/(A+B)) $ 0.03 $ 0.03 (1)
I. Earnings (loss) per share - assuming conversion (E/D) 0.03 (1) 0.03 (1)
Three Months Ended September 30, 1994
- - -------------------------------------
A. Average number of common shares outstanding 5,689,506 5,689,506
B. Average number of common share equivalents
assuming conversion of options (calculated
using the treasury method) 93,430 129,301
C. Average number of common share equivalents
assuming conversion of convertible preferred stock 1,554,305 1,554,305
D. Total average common share and common share
equivalents 7,337,241 7,373,112
E. Net earnings $ 121,885 $ 121,885
F. Preferred dividend requirements 60,445 60,445
G. Income applicable to common stock 61,440 61,440
H. Income per share - no conversion (G/(A+B)) $ 0.01 $ 0.01 (1)
I. Income per share - assuming conversion (E/D) 0.02 (1) 0.02 (1)
</TABLE>
(1) Not material or anti-dilutive.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE EMONS
TRANSPORTATION GROUP, INC. CONSOLIDATED FINANCIAL STATEMENTS FOR THE THREE
MONTHS ENDED SEPTEMBER 30, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1996
<PERIOD-START> JUL-01-1995
<PERIOD-END> SEP-30-1995
<CASH> 1,315,830
<SECURITIES> 0
<RECEIVABLES> 2,320,864
<ALLOWANCES> (94,401)
<INVENTORY> 226,704
<CURRENT-ASSETS> 4,043,052
<PP&E> 25,609,849
<DEPRECIATION> (7,833,619)
<TOTAL-ASSETS> 22,138,695
<CURRENT-LIABILITIES> 4,657,584
<BONDS> 10,184,961
<COMMON> 56,780
0
17,177
<OTHER-SE> 5,268,070
<TOTAL-LIABILITY-AND-EQUITY> 22,138,695
<SALES> 0
<TOTAL-REVENUES> 3,686,403
<CGS> 0
<TOTAL-COSTS> 2,485,693
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 271,181
<INCOME-PRETAX> 348,654
<INCOME-TAX> 131,000
<INCOME-CONTINUING> 217,654
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 217,654
<EPS-PRIMARY> .03
<EPS-DILUTED> 0
</TABLE>
