<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 April 30, 1999
---------------------------------------
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 0-2180
TOTAL-TEL USA COMMUNICATIONS, INC.
------------------------------------
(Exact name of registrant as specified in its charter)
<TABLE>
<S> <C>
New Jersey 22-1656895
- --------------------------------- -------------------
(State or other Jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
</TABLE>
150 Clove Road, 8th Floor, Little Falls, NJ 07424
-----------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (973) 812-1100
Not applicable
----------------
(Former address of principal executive offices) (Zip 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.
<TABLE>
<S> <C>
Class Outstanding at June 14, 1999
- ------------------------------------ ----------------------------
Common Share, $.05 par value 7,622,404
</TABLE>
<PAGE>
TOTAL-TEL USA COMMUNICATIONS, INC.
AND SUBSIDIARIES
FIRST QUARTER REPORT ON FORM 10-Q
INDEX
<TABLE>
<CAPTION>
Page No.
<S> <C>
PART I. FINANCIAL INFORMATION
Condensed Consolidated Statements of Earnings and Comprehensive Income
Three months ended April 30, 1999 and 1998
(unaudited) 3
Condensed Consolidated Balance Sheets
April 30, 1999 (unaudited), and
January 31, 1999 4-5
Condensed Consolidated Statements of Cash Flows
Three months ended
April 30, 1999 and 1998
(unaudited) 6
Notes to Condensed Consolidated Financial
Statements (unaudited) 7-8
Management's Discussion and Analysis of
Financial Condition and Results of Operations 9-11
PART II. OTHER INFORMATION
Items 1-5 12
Item 6. Exhibits and Reports on Form 8-K 12
SIGNATURES 13
</TABLE>
<PAGE>
TOTAL-TEL USA COMMUNICATIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS AND COMPREHENSIVE INCOME
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
------------------
April 30,
--------
1999 1998
---------------- ----------------
<S> <C> <C>
Net Sales $33,530,049 $31,881,593
Costs and expenses
Cost of Sales 26,529,684 25,134,905
Selling, general and administrative 6,481,270 6,335,981
---------------- ----------------
33,010,954 31,470,886
---------------- ----------------
Operating Income 519,095 410,707
---------------- ----------------
Other (expense) income
Interest income 23,123 25,886
Other (expense) income (14,405) 50,581
Interest expense (40,442) (48,515)
---------------- ----------------
Total other (expense) income (31,724) 27,952
---------------- ----------------
Earnings before provision for income taxes 487,371 438,659
Provision for income tax (191,500) (175,440)
---------------- ----------------
Net Earnings $ 295,871 $ 263,219
================ ================
Other comprehensive income, net of tax:
Unrealized holding gain 22,917 25,393
---------------- ----------------
Comprehensive Income $ 318,788 $ 288,612
================ ================
BASIC EARNINGS PER COMMON SHARE $0.04 $0.04
------ -----
DILUTED EARNINGS PER COMMON SHARE $0.04 $0.04
------ -----
Dividends per share NONE NONE
</TABLE>
See notes to condensed consolidated financial statements.
<PAGE>
TOTAL-TEL USA COMMUNICATIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
APRIL 30, JANUARY 31,
1999 1999
---------------- ------------
(Unaudited) (Note)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 2,993,661 $ 6,051,892
Securities available for sale 589,062 549,612
Accounts receivable 20,271,418 18,732,480
Note receivable 95,402 95,402
Deferred income taxes 632,697 1,419,642
Prepaid expenses and other current assets 2,751,354 1,801,210
---------------- -----------------
TOTAL CURRENT ASSETS 27,333,594 28,650,238
PROPERTY AND EQUIPMENT, LESS ACCUMULATED
DEPRECIATION AND AMORTIZATION 13,095,722 14,473,261
OTHER ASSETS:
Deferred line installation costs, 327,058 447,226
less accumulated amortization
Other assets 466,781 488,175
Deferred income taxes 1,569,178 1,633,238
---------------- -----------------
2,363,017 2,568,639
---------------- -----------------
$42,792,333 $45,692,138
================ =================
</TABLE>
Note: The balance sheet at January 31, 1999 has been taken from the audited
consolidated financial statements at that date.
See notes to condensed consolidated financial statements.
(Continued)
<PAGE>
TOTAL-TEL USA COMMUNICATIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
APRIL 30, JANUARY 31,
1999 1999
---------------- -----------
(Unaudited) (Note)
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Current portion of long-term debt $ 536,118 $ 526,361
Accounts payable 19,510,239 20,699,873
Accrued restructuring costs 440,927 2,128,000
Other current and accrued liabilities 2,962,621 3,037,255
Salaries and wages payable 834,306 998,081
---------------- -----------------
TOTAL CURRENT LIABILITIES 24,284,211 27,389,570
---------------- -----------------
OTHER LONG-TERM LIABILITIES 285,565 294,500
---------------- -----------------
LONG-TERM DEBT 1,427,371 1,565,884
---------------- -----------------
SHAREHOLDERS' EQUITY
Common stock 456,139 455,739
Additional paid-in capital 22,843,333 22,809,518
Retained earnings 7,053,857 6,757,987
---------------- -----------------
30,353,329 30,023,244
Unearned ESOP Shares (12,225,000) (12,225,000)
Treasury stock (1,456,781) (1,456,781)
Accumulated other comprehensive income 123,638 100,721
---------------- -----------------
Total Shareholders' Equity 16,795,186 16,442,184
---------------- -----------------
$42,792,333 $45,692,138
================ =================
</TABLE>
Note: The balance sheet at January 31, 1999 has been taken from
the audited consolidated financial statements at that date.
See notes to condensed consolidated financial statements.
<PAGE>
TOTAL-TEL USA COMMUNICATIONS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended
April 30,
1999 1998
---------------- -----------------
<S> <C> <C>
OPERATING ACTIVITIES:
Net earnings $ 295,871 $ 263,219
Adjustment for non-cash charges 2,336,484 974,726
Changes in assets and liabilities (5,020,938) 1,022,940
---------------- -----------------
Net cash (used in) provided by operating activities (2,388,583) 2,260,885
---------------- -----------------
INVESTING ACTIVITIES:
(Increase) decrease in marketable securities (16,533) 25,000
Purchase of securities available for sale - (51,273)
Note receivable - (234,550)
Collection of notes receivable - 4,257
Purchase of property and equipment (553,139) (1,770,971)
Proceeds on sales of fixed assets 3,000 -
Additions to deferred line installation costs (8,435) (11,907)
---------------- -----------------
Net cash used in investing activities (575,107) (2,039,444)
---------------- -----------------
FINANCING ACTIVITIES:
Exercise of stock options 34,215 319,313
Repayments of bank borrowing (128,756) (119,413)
Tax benefit of options exercised - 377,500
---------------- -----------------
Net cash (used in) provided by financing activities (94,541) 577,400
---------------- -----------------
NET (DECREASE) INCREASE IN
CASH AND CASH EQUIVALENTS (3,058,231) 798,841
CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD $ 6,051,892 $ 3,416,904
---------------- -----------------
CASH AND CASH EQUIVALENTS,
END OF PERIOD $ 2,993,661 $ 4,215,745
================ =================
SUPPLEMENTAL DISCLOSURES OF CASH
FLOW INFORMATION:
Cash paid during the period for:
Interest $ 40,442 $ 48,515
Income taxes $ - $ 30,000
</TABLE>
<PAGE>
Note A - Basis of Presentation
The accompanying unaudited condensed consolidated financial statements
have been prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-Q and
Rule 10-01 of Regulation S-X. They do not include all information and notes
required by generally accepted accounting principles for complete financial
statements. However, except as disclosed herein, there has been no material
change in the information disclosed in the notes to consolidated financial
statements included in the Annual Report on Form 10-K of Total-Tel USA
Communications, Inc. and Subsidiaries (the "Company") for the fiscal year ended
January 31, 1999. In the opinion of Management, all adjustments (consisting of
only normal recurring accruals) considered necessary for a fair presentation
have been included. Operating results for the three month period ended April 30,
1999 are not necessarily indicative of the results which may be expected for the
year ending January 31, 2000.
Note B - Stock Split
On July 15, 1998, the Registrant distributed 4,207,887 shares of common
stock in connection with a 2 for 1 stock split in the form of a stock dividend
of all outstanding shares as of June 30, 1998. All per share and number of
shares data have been restated to reflect the stock split.
Note C - Earnings Per Share
The following table sets forth the computation of basic and diluted earnings per
share:
<TABLE>
<CAPTION>
Three Months Ended
April 30, 1999 April 30, 1998
-------------- --------------
<S> <C> <C>
Numerator:
Income available to common shareholders
used in basic and diluted earnings per share $ 295,871 $ 263,219
Denominator:
Weighted-average number of Common
Shares used in basic earnings per share 6,924,154 6,884,674
Effect of diluted securities:
Common stock options 409,770 487,004
--------- ---------
Weighted-average number of Common
Shares and diluted potential Common Shares
used in diluted earnings per share 7,333,924 7,371,678
--------- ---------
Basic earnings per share $ 0.04 $ 0.04
------- -------
Diluted earnings per share $ 0.04 $ 0.04
------- -------
</TABLE>
<PAGE>
Note D - Segment Reporting
The Registrant sells telecommunication services to two distinct
segments: a retail segment, consisting primarily of small to medium size
businesses within the Northeastern United States, and a wholesale segment, with
sales to other telecommunications carriers throughout North America and Europe.
In addition to direct costs, each segments is allocated a proportion of
the Registrant's switch and operating expenses. The allocation of expense is
based upon the minutes of use flowing through the Registrant's switching
network. There are no intersegment sales. Assets are held at the consolidated
level and are not allocable to the operating segments. The Registrant evaluates
performance on operating earnings of the two business segments.
Summarized financial information concerning the Registrant's reportable
segments is shown in the following table:
<TABLE>
<CAPTION>
Retail Wholesale Total
<S> <C> <C> <C>
Three Months Ended
April 30, 1999
Net Sales $18,306,673 $15,223,376 $33,530,049
Gross margin 5,638,175 1,362,190 7,000,365
Operating (loss) income (265,005) 784,100 519,095
Three Months Ended
April 30, 1998
Net Sales $18,765,111 $13,116,482 $31,881,593
Gross margin 5,555,250 1,191,438 6,746,688
Operating income 122,987 287,720 410,707
</TABLE>
THE REST OF THIS PAGE INTENTIONALLY LEFT BLANK
<PAGE>
TOTAL-TEL USA COMMUNICATIONS, INC. AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULT OF OPERATIONS
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS:
Certain matters discussed in this Quarterly Report on Form 10-Q are
"forward-looking statements" intended to qualify for the safe harbor from
liability provided by the Private Securities Litigation Reform Act of 1995.
These forward-looking statements can generally be identified as such because the
context of the statement will include words such as the Registrant "believes",
"anticipates", "expects", or words of similar import. Similarly, statements
which describe the Registrant's future plans, objectives or goals are also
forward-looking statements. Such forward-looking statements are subject to
certain risks and uncertainties which are described in close proximity to such
statements and which could cause actual results to differ materially from those
anticipated as of the date of this Report. Shareholders, potential investors and
other readers are urged to consider these factors in evaluating the
forward-looking statements and are cautioned not to place undue reliance on such
forward-looking statements. The forward-looking statements included herein are
only made as of the date of this Report and the Registrant undertakes no
obligation to publicly update such forward-looking statements to reflect
subsequent events or circumstances.
YEAR 2000 MATTERS
As is the case with most other companies using computers in their
operations, the Registrant is in the process of addressing the year 2000 (Y2K)
issues. The Registrant believes it has a solid plan in place. Modifications,
such as software and hardware upgrades have been scheduled or are under
development/deployment for all Information Technology ("IT") and non-IT systems.
Specifically, the Registrant's review of its year 2000 compliance included the
Registrant's electronic data processing equipment, including all switches,
digital cross connects, and other date sensitive processor associated with the
Registrant's telecommunications network, back office, and billing and collection
systems. Any required modifications would be addressed concurrently with another
project to enhance the Registrant's billing system and should be completed by
the third quarter of 1999. The total cost for the upgrades and management
overhead is estimated to be approximately $750,000, which has been included in
the Registrant's budget.
Despite the foregoing efforts and expenditures, there can be no
assurance that the Registrant will be able to identify all year 2000 issues in
its IT and non-IT systems in advance of their occurrence or that the Registrant
will be able to successfully remedy any such issues. Additionally, to the extent
that the Registrant's suppliers or customers fail to address year 2000 issues in
a timely and effective manner, the Registrant's ability to provide
uninterrupted, reliable service to customers serviced through its networks may
be adversely affected. In an effort to assess the foregoing risk, the Registrant
has been surveying all of its material customers and suppliers as to their
current state of year 2000 compliance. Based on the survey results, the
Registrant believes they are taking the steps necessary to ensure their
readiness.
The profitability and stability of the Registrant's customers may be
adversely affected by year 2000 issues not related to their relationships with
the Registrant. The expenses or liabilities to which the Registrant may become
subject as a result of any year 2000 issues, or the impact of year 2000 issues
on the ability of existing or future customers to do business with the
Registrant cannot be precisely determined, but could have a material adverse
effect on the Registrant's business, operating results and financial condition.
<PAGE>
Overview
The Registrant is a regional facilities-based telecommunications
provider servicing both the commercial and wholesale marketplace. The Registrant
began offering interexchange telecommunications services in January, 1983. Gross
revenues have increased from approximately $30 million in the Fiscal year ended
January 31, 1995 ("Fiscal 1995") to approximately $137 million in the Fiscal
year ended January 31, 1999.
The Registrant has recently changed its direction from national
expansion, to focus on further penetration into the Northeastern USA market,
rather than pursuing a plan of national expansion previously announced. This
decision led to a restructuring of the Registrant's business, which eliminated
sales offices in Florida, Georgia, Virginia and the United Kingdom, as well as
the switch in Miami, Florida. This restructuring has resulted in an operating
profit of approximately $519,000 for the first quarter ended April 30, 1999.
This return to profitability is the direct result of the actions taken by
management to implement the new strategy.
The Registrant currently owns two long-distance switches, one in New
York City and the other in Newark, New Jersey. The Registrant also has a Network
Operating Center, (NOC) that monitors and controls its network. The Registrant
sells its services through three sales groups; a field retail sales force,
independent sales agents, and a wholesale sales group.
The Registrant's principal expenses consist of cost of sales and
selling, general and administrative expenses, (SG&A). Cost of sales consist of
access fees, line installation expenses, operations expenses, switch expenses,
NOC expenses, depreciation, transport expenses and local and long-distance
expenses. S,G&A expenses includes selling and marketing costs, customer service
and general and administrative costs.
Results of Operations:
Net sales were approximately $33,530,000 for the first quarter of the
current fiscal year, an increase of approximately $1,648,000, or 5.2%, over the
prior fiscal year's first quarter net sales of approximately $31,882,000.
Carrier revenue increased to approximately $15,223,000, an increase of
approximately $2,107,000, or 16.1% over the prior fiscal year's first quarter of
approximately $13,116,000. Retail sales declined to approximately $18,307,000, a
decrease of approximately $458,000, or 2.4%, from the prior fiscal year's first
quarter of approximately $18,765,000.
Despite a 12.9% increase or approximately 20,068,000 retail minutes
billed, from approximately 155,644,000 in the prior year's fiscal quarter to
approximately 175,712,000 in the current fiscal quarter, retail revenues
declined. This is attributable to the reduction in average selling price, of
approximately 1.7 cents per minute, or 14.1%. The growth in demand for
additional usage in the telecommunications market has driven the increase in the
Registrant's volume. However, the intense competition that exists in that market
continues to drive the average selling price downward.
Cost of sales increased to approximately $26,530,000, an increase of
approximately $1,395,000, or 5.6% from the prior fiscal year's first quarter of
approximately $25,135,000. This variance was unfavorable in relationship to
sales. This increase was primarily due to the sales volume increases experienced
by the Registrant's carrier business, as described above. The direct line costs
for the Registrant increased to approximately $25,172,000, an increase of
approximately $1,296,000, or 5.4%, from the approximately $23,876,000 of direct
line costs experienced in the first quarter of the prior fiscal year. The
balance of the increase was primarily due to increased costs of salaries and
wages relating to the upgrade of the technical staff employed in operations, the
switch locations and the NOC.
Selling, general and administrative expense for the current fiscal
quarter were approximately $6,481,000, an increase of approximately $145,000, or
2.3% as compared to the first quarter amount of approximately $6,336,000 for
the prior fiscal year. This increase resulted primarily from an increase in
<PAGE>
salaries, wages and fringe benefits of approximately $377,000, an increase in
sales commissions expense (due to the sales increase) of approximately $98,000,
and an increase in recruiting fees to hire sales staff in the new regional sales
offices of approximately $55,000. These increases were partially offset by
savings in legal expenses of approximately $230,000, reductions in consulting
fees of approximately $26,000, savings on travel and entertainment expenses of
approximately $61,000, savings on data processing services of approximately
$29,000 and net savings from other cost reduction measures of approximately
$39,000.
Other expense for the current fiscal quarter was approximately $32,000,
as compared to approximately $28,000 of other income recorded in the fiscal
quarter ended April 30, 1998. The $60,000 change was primarily due to income
derived from prepaid debit cards.
Diluted earnings per share of $0.04 from continuing operations for the
quarter ending April 30, 1999 were equal to the $.04 per share for the quarter
ended April 30, 1998.
Liquidity and Capital Resources
At April 30, 1999, the Registrant had working capital of approximately
$3,049,000, an increase of approximately $1,789,000 as compared to January 31,
1999. The ratio of current assets to current liabilities at April 30, 1999
increased to 1.1:1, over the ratio of 1.0:1 at January 31, 1999. The increase in
working capital at April 30, 1999 was primarily attributable to an increase in
net accounts receivable of approximately $1,539,000; an increase in prepaid
expenses and other current assets of approximately $950,000; an increase on the
value of securities available for sale of approximately $39,000; decreases in
accounts payable of approximately $1,190,000; a decrease in the accrued
restructuring costs and other current and accrued liabilities of approximately
$1,762,000; decreases in salaries and wages payable of approximately $164,000.
This was offset by a decrease in cash and cash equivalents of approximately
$3,058,000, deferred taxes of approximately, $787,000 and an increase in the
current portion of long term debt of approximately $10,000. The Registrant
continues to maintain a strong liquid position.
The decrease in cash of approximately $3,058,000 was the result
primarily of the changes in assets and liabilities of approximately $5,021,000;
purchases of fixed assets of approximately $553,000 and the repayment of bank
borrowings of approximately $129,000. This was offset primarily by net earnings
of approximately $296,000, non-cash charges for depreciation and amortization of
approximately $670,000, doubtful accounts of approximately $221,000, write off
of property and equipment of approximately $1,400,000 and non-cash compensation
of approximately $47,000.
Capital expenditures during the first three months of fiscal year 2000
were approximately $553,000 and were financed from funds provided by operations.
Approximately $321,000 of these expenditures were applicable to the purchase of
upgrades to the switch equipment in New York and New Jersey, approximately
$108,000 for the purchase of equipment necessary to become an Internet Service
Provider (ISP) and approximately $124,000 for software and hardware upgrades to
the current data processing network.
The Registrant is in the process of determining the capital needs to
enhance its ability to offer new products and services such as local service,
ISP, enhanced calling card and toll-free service and city code routing. The
expenditures necessary for these needs, (during the balance of fiscal 2000) are
estimated to be approximately $4,800,600, comprising the software and hardware
necessary for a new billing, financial and sales compensation systems, various
upgrades to the current switch and additional data processing hardware and
software needed to control the flow of information. These expenditures are
planned to be financed through vendor financing, working capital and additional
lines of credit which the Registrant intends to negotiate with its current
lender, or other sources.
As of April 30, 1998, the Registrant had an Equipment Facility and
Revolving Credit Agreement (the "Facility") with a major New Jersey bank. This
Facility provides the Registrant with an unsecured line of credit of $5,000,000.
In addition, the Registrant has drawn down $1,963,489 of a prior loan commitment
at an interest rate of 7.71% payable over five years.
<PAGE>
TOTAL-TEL USA COMMUNICATIONS, INC. AND SUBSIDIARIES
PART II - OTHER INFORMATION
THREE MONTHS ENDED APRIL 30, 1999
ITEMS 1 - 5 Not applicable
ITEM 6 Exhibits and reports on Form 8-K
(a) Exhibits - 27 Financial Data Schedule
(b) There were no reports on Form 8-K filed
for the three months ended April 30, 1999.
<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.
TOTAL-TEL USA COMMUNICATIONS, INC.
(Registrant)
<TABLE>
<S> <C>
Date June 14, 1999 By /S/ Warren H. Feldman, Esq.
---------------------- -------------------------------
Warren H. Feldman, Esq.
Chairman of the Board of Directors
Date June 14, 1999 By /S/ Dennis Spina
---------------------- -----------------------------
Dennis Spina
President, Chief Operating Officer, Director
Date June 14, 1999 By /S/ Salvatore M. Quadrino
---------------------- -----------------------------
Salvatore M. Quadrino
Vice President, Chief Financial Officer
Date June 14, 1999 By /S/ Thomas P. Gunning
---------------------- -----------------------------
Thomas P. Gunning
Vice President, Secretary/Treasurer,
Principal Accounting Officer
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE CONSOLIDATED BALANCE SHEET AS OF
APRIL 30, 1999 AND THE CONSOLIDATED STATEMENT OF
OPERATIONS FOR THE THREE MONTHS ENDED APRIL 30, 1999
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JAN-31-2000
<PERIOD-END> APR-30-1999
<CASH> 2,993,661
<SECURITIES> 589,062
<RECEIVABLES> 21,667,453
<ALLOWANCES> 1,300,633
<INVENTORY> 0
<CURRENT-ASSETS> 27,333,594
<PP&E> 22,178,943
<DEPRECIATION> 9,083,221
<TOTAL-ASSETS> 42,792,333
<CURRENT-LIABILITIES> 24,284,211
<BONDS> 1,427,371
<COMMON> 456,139
0
0
<OTHER-SE> 16,339,047
<TOTAL-LIABILITY-AND-EQUITY> 42,792,333
<SALES> 33,530,049
<TOTAL-REVENUES> 33,530,049
<CGS> 26,529,684
<TOTAL-COSTS> 26,529,684
<OTHER-EXPENSES> 6,260,513
<LOSS-PROVISION> 220,757
<INTEREST-EXPENSE> 40,442
<INCOME-PRETAX> 487,371
<INCOME-TAX> 191,500
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 295,871
<EPS-BASIC> 0.04
<EPS-DILUTED> 0.04
</TABLE>
