UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES ACT OF 1934
For the Quarterly Period Ended March 31, 1995
Commission File Number 0-10096
STRIKER INDUSTRIES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 84-0834953
(state or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
ONE RIVERWAY, SUITE 2450
HOUSTON, TEXAS 77056
(Address of principal executive offices)
(Zip Code)
(713) 622-4092
(Registrant's telephone number, including area code)
NOT APPLICABLE
(Former name if changed since last report)
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 [ ]
As of May 10 1995, there were 8,687,106 shares of Common Stock, par value
$0.20 per share, outstanding and no shares of Preferred Stock, par value $0.20
per share, were outstanding.
Page 1 of 13
<PAGE>
INDEX TO QUARTERLY REPORT ON FORM 10-Q
PART I. FINANCIAL INFORMATION PAGE NO.
Item 1. Financial Statements
Consolidated Balance Sheet ............................ 3
Consolidated Statements of Operations ................. 4
Consolidated Statements of Cash Flows ................. 5
Notes to Consolidated Financial Statements ............ 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations ......... 8
PART II. OTHER INFORMATION
Item 1. Legal Proceedings ..................................... 11
Item 2. Changes in Securities ................................. 11
Item 3. Defaults Upon Senior Securities........................ 11
Item 4. Submission of Matters to a Vote of Security Holders ... 11
Item 5. Other Information ..................................... 12
Item 6. Exhibits and Reports on Form 8-K ...................... 12
SIGNATURES............................................. 13
Page 2 of 13
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1: FINANCIAL STATEMENTS
STRIKER INDUSTRIES, INC., AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
March 31,
1995
(Unaudited)
-----------
ASSETS
CURRENT ASSETS:
Cash ................................................... $ 260,630
Accounts receivable -
Trade ............................................. 932,633
Other ............................................. 94,118
Inventories -
Raw materials ..................................... 27,069
Finished goods .................................... 83,508
Spare parts and supplies .......................... 291,253
Prepaid expenses and other current assets .............. 247,784
-----------
Total current assets ................................... 1,936,995
PROPERTY AND EQUIPMENT, net ..................................... 5,354,669
DEFERRED FINANCING COSTS AND OTHER, net ......................... 736,954
-----------
Total assets ........................................... $ 8,028,618
===========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Trade accounts payable ................................. $ 859,707
Accrued liabilities .................................... 370,258
Current obligations under capital leases ............... 51,032
-----------
Total current liabilities ....................................... 1,280,997
LONG-TERM LIABILITIES:
7.00% Notes payable to affiliates ...................... 266,698
10.25% Subordinated notes .............................. 1,200,000
Capital leases ......................................... 86,465
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
Common stock, $0.20 par value, 25,000,000 shares
authorized, 8,687,106 shares issued at March 31, 1995 .. 1,737,421
Stock Subscriptions Receivable ......................... (450,000)
Warrants ............................................... 850,000
Additional paid-in capital ............................. 5,126,832
Retained deficit ....................................... (2,069,795)
-----------
Total stockholders' equity ............................. 5,194,458
-----------
Total liabilities and stockholders' equity ............. $ 8,028,618
===========
The accompanying notes are an integral part of these consolidated
financial statements.
Page 3 of 13
<PAGE>
STRIKER INDUSTRIES, INC., AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended March 31,
-----------------------------
1995 1994
----------- -----------
REVENUES ................................. $ 1,911,763 $ 1,813,618
COST OF SALES ............................ 1,363,596 1,590,786
----------- -----------
Gross margin .................... 548,167 222,832
SELLING, GENERAL AND
ADMINISTRATIVE ....................... 361,670 372,624
----------- -----------
Operating profit/(loss) ......... 186,497 (149,792)
OTHER INCOME (EXPENSE):
Interest expense, net ........... (7,130) (60,443)
Other income, net ............... 215 3,464
----------- -----------
INCOME (LOSS) BEFORE
INCOME TAXES ........................... 179,582 (206,771)
----------- -----------
INCOME TAXES ............................. -- --
----------- -----------
NET INCOME (LOSS) ........................ $ 179,582 $ (206,771)
=========== ===========
NET INCOME (LOSS) PER SHARE .............. $ 0.02 $ 0.03)
=========== ===========
AVERAGE NUMBER OF COMMON SHARES
OUTSTANDING ............................. 9,951,889 8,007,416
=========== ===========
The accompanying notes are an integral part of these consolidated
financial statements.
Page 4 of 13
<PAGE>
STRIKER INDUSTRIES, INC., AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended March 31,
-------------------------------
1995 1994
----------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
NET INCOME/(LOSS) .......................................................................... $ 179,582 $ (206,771)
Adjustments to reconcile net income/(loss) to net cash used in operating
activities -
Depreciation and amortization ..................................................... 157,548 131,148
Reimbursement for executive salaries ............................................ (33,000) --
Changes in assets and liabilities -
Increase in accounts receivable ................................................... (485,391) (830,210)
Decrease (increase) in inventories ................................................ 193,103 (550,382)
Decrease (increase) in prepaid expenses and other current assets
(53,335) 13,382
(Decrease) increase in accounts payable and accrued liabilities ................... (29,950) 1,056,194
Increase in Deferred Revenue ...................................................... -- 106,718
----------- -----------
Total adjustments to net income (loss) ............................................ (251,025) (73,150)
----------- -----------
Net cash used in operating activities ............................................. $ (71,443) $ (279,921)
=========== ===========
CASH FLOWS FROM INVESTING ACTIVITIES:
Gain on pulp hedge contract ........................................................... (310,824) --
Purchases of property and equipment ................................................... (609,629) (628,826)
Increase in deferred financing costs and other ........................................ (140,298) (120,140)
Redemption of certificate of deposit to retire
revolving line of credit .............................................................. -- 250,000
----------- -----------
Net cash used in investing activities ................................................. (1,060,751) (498,966)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from subordinated notes ...................................................... 1,200,000 --
Proceeds from convertible subordinated notes .......................................... -- 1,500,000
Proceeds from issuance of warrants .................................................... 850,000 --
Shareholder advances .................................................................. 838,500 500,000
Repayment of advances from shareholders ............................................... (1,480,618) (500,000)
Payments on treasury stock purchase obligation ........................................ -- (450,000)
Payments of revolving line of credit .................................................. -- (499,140)
Payments received on stock subscriptions receivable ................................... -- 250,000
Payments under insurance premium note payable ......................................... (19,661) (41,730)
Principal payments under capital leases ............................................... (14,136) (10,130)
----------- -----------
Net cash provided by financing activities ............................................. 1,374,085 749,000
----------- -----------
NET INCREASE (DECREASE) IN CASH ............................................................ 241,891 (29,887)
CASH, beginning of period .................................................................. 18,739 49,947
----------- -----------
CASH, end of period ........................................................................ $ 260,630 $ 20,060
=========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
Page 5 of 13
<PAGE>
STRIKER INDUSTRIES, INC., AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1. GENERAL:
PRINCIPLES OF CONSOLIDATION
The accompanying consolidated financial statements include the accounts of the
Company after the elimination of all material intercompany accounts and
transactions.
INTERIM FINANCIAL INFORMATION
The consolidated interim financial statements included herein are unaudited;
however, they include all adjustments of a normal recurring nature which, in the
opinion of management, are necessary to present fairly the consolidated
financial position of the Company at March 31, 1995 and the consolidated results
of operations and the cash flows for the three months ended March 31, 1995 and
1994.
2. DEBT:
March 31, 1995
--------------
(Unaudited)
Notes Payable to affiliates bearing interest at 7%,
interest and principal due at maturity,
June 30, 1996, unsecured .................................... $ 266,698
Subordinated Notes due December 31, 1998, bearing
interest at 10.25%, interest payable quarterly .............. $ 1,200,000
Capitalized lease obligations bearing interest at
rates from 10% to 24%, maturing between 1994 and
1998, secured by underlying machinery,
vehicles and computer equipment ............................. 137,498
-----------
1,604,196
Less - Current maturities .................................... (51,032)
-----------
$ 1,553,164
===========
Interest paid for the three months ended March 31, 1995, and 1994, was $7,165
and $5,140, respectively.
3. STOCKHOLDERS' EQUITY:
During the quarter ended March 31, 1995, the Registrant authorized the issuance
of Warrants to purchase an aggregate of 1,000,000 shares of Common Stock of the
Registrant at a Warrant Price of $1.50 per share and an Exercise Price of $2.00
per share escalating to $2.65 per share over the term of the Warrant which
expires on February 28, 1997. During the quarter ended March 31, 1995, $850,000
was received by the Registrant upon issuance of the Warrants, none of which were
exercised as of March 31, 1995. The Warrants contain an undertaking of the
Registrant to effect a "shelf registration" with respect to shares of the
Registrant issuable upon the exercise thereof.
Page 6 of 13
4. SUBSEQUENT EVENTS:
During April 1995, an additional $100,000 was received for the purchase of the
Warrants from international investors. The warrants are identical in terms and
conditions to the warrants mentioned above.
On May 5, 1995, the asset purchase transaction of the land, building and
equipment of Northern Globe Building Materials, Inc.'s idled dry felt mill in
Thorold, Ontario, Canada pursuant to the Asset Purchase Agreement between
Northern Globe Building Materials, Inc. (Northern), an independent third party
unrelated to the Registrant or any of its affiliates, and the Registrant dated
march 10, 1995 was consummated. The purchase price of the assets purchased was
1,345,790 shares of common stock of the Registrant and $250,000 cash. The
physical properties and assets purchased had formerly been used to manufacture
dry felt paper, but had not been in operation and had been idled and wholly
inactive for more than two years preceding their purchase by the Registrant. The
Registrant intends to reactivate the idled dry felt mill and produce dry felt at
Thorold, Ontario, Canada for sale to Northern and independent third parties in
the roofing industry. Sales to Northern will be pursuant to a supply agreement
entered into between the Registrant and Northern pursuant to which the
Registrant will supply Northern's three operating Canadian shingle and rolled
roofing facilities with a minimum of 15,000 tons of dry felt paper per year,
seasonally adjusted, for the period commencing on or about June 1, 1995 through
December 31, 2000. the dry felt purchase price set forth in the supply agreement
is based on the mix of the raw materials used in the manufacture of the dry felt
and the market price of the raw materials.
On May 4, 1995, the Company entered into a financing agreement with a major U.S.
lender. The financing agreement consists of a term loan based upon the
liquidation value of certain of the Company's fixed assets and a revolving
borrowing line of credit based upon eligible accounts receivable (collectively
"the Facility"). Advances under the Facility are limited to $2,500,000 in the
aggregate and bear interest at prime plus 3%. On May 4, 1995, the Company
received $1,000,000 of advances under the Facility, consisting of $590,000 of
advances under the term loan and $410,000 of advances under the revolving line
of credit.
5. PULP HEDGE CONTRACT:
During the six months ended June 30, 1994, certain traditional sources of raw
materials used by Striker Paper Corporation (SPC) were not able to provide the
quantity of raw materials required to meet the SPC's level of production of dry
felt at a satisfactory price. Accordingly, SPC experienced a dramatic increase
in the cost of its raw materials. In an effort to mitigate its exposure to
rising raw material costs, the Company created a new subsidiary, Striker
Services Corporation (SSC), to obtain one component of the raw materials, old
corrugated cardboard (OCC), in sufficient quantities to meet its production
requirements. Quantities of OCC obtained in excess of that required to meet
SPC's production level may be sold to third parties at market prices which are
expected to be in excess of SSC's estimated costs.
As a result of continued concern about rising raw material costs and the
uncertainty of the success of the OCC gathering operations of SSC, the Company
entered into a Pulp Hedge Contract (the Hedge) to effectively hedge against
rising raw material prices. The terms of the Hedge provide for a term of five
years and for a notional amount of SPC's pulp needs for production in Stephens,
Arkansas in addition to fixed price commitments under which SSC agrees to supply
third parties with OCC. SPC's need for pulp at their Stephens facility range
from 1,500 to 3,000 tons per month. SSC currently has no fixed price commitments
to supply third parties with OCC. The Hedge can be terminated by either party
with 30 days notice provided that a settlement payment (as defined and limited
to the net cash paid to a party over life of the Hedge after giving effect to
that party's payments to the other party over the life of the Hedge) is made to
the Company or counterparty, as applicable. Additionally, the Hedge provides
that SSC's imputed cost will be the lesser of: (i) SSC's cash cost (as defined)
or (ii) market price for OCC as quoted in trade publications. During the quarter
ended March 31, 1995, the Company received $310,824 pursuant to the Hedge. The
Company accounts for the Pulp Hedge as a reduction of the raw materials costs
and is offset against advances from shareholders.
Page 7 of 13
Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
This discussion should be read in conjunction with the Financial Statements of
the Company included elsewhere in this 10-QSB.
RESULTS OF OPERATIONS
THREE MONTHS ENDED MARCH 31,
-----------------------------
1995 1994
----------- -----------
Revenues ..................................... $ 1,911,763 $ 1,813,618
Costs of Sales ............................... 1,363,596 1,590,786
----------- -----------
Gross Margin ............................ 548,167 222,832
Selling, General and Administrative .......... 361,670 372,624
----------- -----------
Operating Profit/(Loss) ................. 186,497 (149,792)
Interest Expense, Net ........................ (7,130) (60,443)
Other Income ................................. 215 3,464
----------- -----------
Net Income/(Loss) Before Income Taxes ........ $ 179,582 $ (206,771)
=========== ===========
In order to concentrate on maximizing the potentially more profitable sales of
dry felt paper, during August 1994, the company temporarily suspended
manufacturing asphalt saturated felt. This action has resulted in significant
decreases in payroll-related expenses as well as reductions in other components
of factory overhead. During the quarter ended March 31, 1995, the Company has
exclusively manufactured dry felt for sale to its customer base. All sales of
saturated felt have come from existing inventories of previously manufactured
saturated felt. For the quarter ended March 31, 1994, the Company was
manufacturing saturated felt and dry felt.
COMPARISON OF QUARTERS ENDED MARCH 31, 1995 AND 1994
Sales for the quarter ended March 31, 1995, were $1,911,763, an increase of 5.4%
from sales of $1,813,618 for the quarter ended March 31, 1994. This increase was
due primarily to an increase in the selling price of dry felt and a change in
the product mix from saturated felt to dry felt.
Gross margin increased to $548,167 (28.7% of total sales for the quarter ended
March 31, 1995) from a gross margin of $222,832 (12.3% of total sales for the
quarter ended March 31, 1994). This increase was due to the switch in product
mix as discussed above and the reduced cost of raw materials as a result of the
hedge agreement.
Selling, general and administrative expenses decreased by $10,954 (2.9%) to
$361,670 for the quarter ended March 31, 1995, from $372,624 for the quarter
ended March 31, 1994. This decrease is primarily due to savings on group medical
insurance premiums.
Page 8 of 13
Interest expense, net decreased to $7,130 for the quarter ended March 31, 1995,
from $60,443 for the quarter ended March 31, 1994. This decrease is due to a
reduction in the amount of subordinated notes and the elimination of the bank
line of credit.
Because the Company has been in a loss position for financial and income tax
reporting purposes, a valuation allowance has been set up to fully reserve for
deferred income tax benefits arising from the Company's net operating losses. No
current or deferred income tax benefits have been provided due to the
uncertainty of realization of such net operating losses in future periods.
CASH FLOWS - COMPARISON OF THREE MONTHS ENDED MARCH 31, 1995 AND 1994.
Cash flows used in operating activities decreased from $ 279,921 for the three
months ended March 31, 1994 to $71,443 for the three months ended March 31,
1995. The decrease was primarily due to an increase in sales and the resultant
turnover of inventory and increased collections of receivables.
Cash flows used in investing activities increased to $1,060,751 for the three
months ended March 31, 1995 from $498,966 the three months ended March 31, 1994.
This increase is primarily due to the gain on the pulp hedge contract in 1995
and the redemption of the certificate of deposit in 1994.
Cash flows provided by financing activities increased $625,085 from $749,000 for
the three months ended March 31, 1994 to $1,374,085 for the three months ended
March 31, 1995. This increase is primarily due to proceeds of warrants in 1995
and 1994 payments made on the treasury stock purchase obligation and the
revolving line of credit.
LIQUIDITY AND CAPITAL RESOURCES
Certain stockholders of the Company have agreed to provide additional financial
support in the event the Company does not have available cash or cash
equivalents to meet its then current obligations and continue its normal
business operations. This additional support, not exceeding in the aggregate
$3,000,000, during a 18-month period ending September 30, 1996, would only be
provided if liquid assets or financing from other sources cannot be arranged.
During the quarter ended March 31, 1995, the Registrant authorized the issuance
of Warrants to purchase an aggregate of 1,000,000 shares of Common Stock of the
Registrant at a Warrant Price of $1.50 per share and an Exercise Price of $2.00
per share escalating to $2.65 per share over the term of the Warrant which
expires on February 28, 1997. During the quarter ended March 31, 1995, $850,000
was received by the Registrant upon issuance of the Warrants, none of which were
exercised as of March 31, 1995. The Warrants contain an undertaking of the
Registrant to effect a "shelf-registration" with respect to shares of the
Registrant issuable upon the exercise thereof.
During April 1995, an additional $100,000 was received for the purchase of the
Warrants from international investors. The warrants are identical in terms and
conditions to the warrants mentioned above.
Page 9 of 13
On May 4, 1995, the Company entered into a financing agreement with a major U.S.
lender. The financing agreement consists of a term loan based upon the
liquidation value of certain of the Company's fixed assets and a revolving
borrowing line of credit based upon eligible accounts receivable (collectively
"the Facility"). Advances under the Facility are limited to $2,500,000 in the
aggregate and bear interest at prime plus 3%. On May 4, 1995, the Company
received $1,000,000 of advances under the Facility, consisting of $590,000 of
advances under the term loan and $410,000 of advances under the revolving line
of credit.
The Company believes its existing funds, its cash generated by anticipated
operations, collections on sales and its existing financial arrangements will
adequately fund the cash needs of the Company's anticipated operations during
the next year. However, to continue to expand its business, the Company may need
to borrow additional amounts or obtain an additional third-party credit
facility. The Company is currently evaluating several proposals for a
third-party credit facility from various asset-based lenders in relation to the
start-up costs associated with the Thorold paper mill purchased from Northern.
There can be no assurances that a third-party credit facility will be obtained.
In the event a third-party credit facility cannot be obtained, the Company
remains flexible to pursue alternate financing arrangements which might include
private or public sales of equity or debt securities and participation in
governmental bond financing programs.
The ability of the Company to achieve successful operations and realize its
assets is dependent upon many factors including successful operation of the
paper mills, penetration of existing markets at profitable margin and volume
levels and continued cash liquidity.
Page 10 of 13
PART II - OTHER INFORMATION
Item 1. LEGAL PROCEEDINGS.
The Registrant is not a party to any pending proceeding, nor is any of its
property subject to any legal proceeding
Item 2. CHANGES IN SECURITIES.
None.
Item 3. DEFAULTS UPON SENIOR SECURITIES.
None.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
None.
Page 11 of 13
Item 5. OTHER INFORMATION.
(1) On March 2, 1995, the Registrant issued $1,200,000 in aggregate
principal amount of 10.25 % Subordinated Notes (the "1995 Notes") to seven
international investors, three of which are stockholders. The 1995 Notes mature
on December 31, 1998 and interest is payable quarterly beginning July 1, 1995.
The proceeds of the 1995 Notes were used to pay down notes payable to an
affiliate.
(2) During the quarter ended March 31, 1995, the Registrant authorized the
issuance of Warrants to purchase an aggregate of 1,000,000 shares of Common
Stock of the Registrant at a Warrant Price of $1.50 per share and an Exercise
Price of $2.00 per share escalating to $2.65 per share over the term of the
Warrant which expires on February 28, 1997. During the quarter ended March 31,
1995, $850,000 was received by the Registrant upon issuance of the Warrants,
none of which were exercised as of March 31, 1995. The Warrants contain an
undertaking of the Registrant to effect a "shelf registration" with respect to
shares of the Registrant issuable upon the exercise thereof.
(3) On May 5, 1995, the asset purchase transaction of the land, building
and equipment of Northern Globe Building Materials, Inc.'s idled dry felt mill
in Thorold, Ontario, Canada pursuant to the Asset Purchase Agreement between
Northern Globe Building Materials, Inc. (Northern, an independent third party
unrelated to the Registrant or any of its affiliates), and the Registrant dated
March 10, 1995 was consummated. The purchase price of the assets purchased was
1,345,790 shares of Common Stock of the Registrant and $250,000 cash. The
physical properties and assets purchased had formerly been used to manufacture
dry felt paper, but had not been in operation and had been idled and wholly
inactive for more than two years preceding their purchase by the Registrant. The
Registrant intends to reactivate the idled dry felt mill and produce dry felt at
Thorold, Ontario, Canada for sale to Northern and independent third parties in
the roofing industry. Sales to Northern will be pursuant to a supply agreement
entered into between the Registrant and Northern pursuant to which the
Registrant will supply Northern's three operating Canadian shingle and rolled
roofing facilities with a minimum of 15,000 tons of dry felt paper per year,
seasonally adjusted, for the period commencing on or about June 1, 1995 through
December 31, 2000. The dry felt purchase price set forth in the supply agreement
is based on the mix of the raw materials used in the manufacture of the dry felt
and the market price of the raw materials.
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
Asset Purchase Agreement dated as of March 10, 1995 between Northern
Globe Building Materials, Inc. and the Registrant (filed as Exhibit 2.3
to the Registrant's Annual Report on Form 10-KSB for the period ended
December 31, 1994, and hereby incorporated herein by reference).
(b) Reports on Form 8-K:
No reports on Form 8-K were filed by the Registrant during the quarter ended
March 31, 1995:
Page 12 of 13
SIGNATURES:
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, hereunto duly authorized.
STRIKER INDUSTRIES, INC.
DAVID A. COLLINS
DATE: MAY 10, 1995 BY: David A. Collins
Chief Executive Officer
MATTHEW D. POND
DATE: MAY 10, 1995 BY: Matthew D. Pond
Chief Financial Officer
Page 13 of 13
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE FINANCIAL DATA SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE COMPANY'S FORM 10-QSB FOR THE PERIOD ENDED MARCH 31, 1995 AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1995
<CASH> 260,630
<SECURITIES> 0
<RECEIVABLES> 1,026,751
<ALLOWANCES> 0
<INVENTORY> 401,830
<CURRENT-ASSETS> 1,936,995
<PP&E> 6,616,159
<DEPRECIATION> 1,261,490
<TOTAL-ASSETS> 8,028,618
<CURRENT-LIABILITIES> 1,280,997
<BONDS> 0
<COMMON> 1,737,421
0
0
<OTHER-SE> 3,457,037
<TOTAL-LIABILITY-AND-EQUITY> 8,028,618
<SALES> 1,911,763
<TOTAL-REVENUES> 1,911,763
<CGS> 1,363,596
<TOTAL-COSTS> 1,725,266
<OTHER-EXPENSES> (215)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 7,130
<INCOME-PRETAX> 179,582
<INCOME-TAX> 179,582
<INCOME-CONTINUING> 179,582
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 179,582
<EPS-PRIMARY> 0.02
<EPS-DILUTED> 0.02
</TABLE>
