<PAGE>
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 September 30, 1998; 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 No. 0-9997
United Heritage Corporation
---------------------------
(Exact name of registrant as specified in charter)
Utah 87-0372826
- ------------------------------- ------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
2 North Caddo Street, Cleburne, Texas 76031
-------------------------------------------
(Address of principal executive offices)
(817) 641-3681
----------------------------------------------------
(Registrant's telephone number, including area code)
No Change
--------------------------------------------------------------
(Former name, former address and former fiscal year 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 [ ]
The number of shares of common stock, $0.001 par value,
outstanding at October 19, 1998, was 97,400,512 shares.
PAGE
<PAGE>
PAGE 1
UNITED HERITAGE CORPORATION
INDEX
Page Number
Part I - Financial Information
Item 1 - Financial Statements (unaudited)
Consolidated Condensed Balance Sheets
at September 30, 1998 and March 31, 1998 2
Consolidated Condensed Statements of Income
for the six months ending September 30, 1998 and
September 30, 1997 4
Consolidated Condensed Statements of Cash
Flows for the Three Months ended September 30,
1998 and September 30, 1997 5
Notes to Consolidated Condensed Financial
Statements 6
Item 2 - Management's Discussion and Analysis
of Financial Condition and Results of Operation 9
Part II - Other Information
Item 1 - Legal Proceedings 12
Item 2 - Changes in Securities 12
Item 3 - Defaults upon Senior Securities 12
Item 4 - Submission of Matters to a Vote of
Security Holders 12
Item 5 - Other Information 14
Item 6 - Exhibits and Reports on Form 8-K 14
Signatures 15
PAGE
<PAGE>
PAGE 2
Part I, Item 1. Financial Statements
UNITED HERITAGE CORPORATION
- -------------------------------------
UNITED HERITAGE CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS
September 30, 1998 March 31, 1998
------------------ --------------
UNAUDITED
ASSETS
CURRENT ASSETS
Cash and cash equivalent $ 651,634 $ 1,390,416
Interest receivable 2,959
Accounts receivable - trade 159,528 95,202
Other accounts receivable 53,183
Inventory 39,092 26,847
Other current assets 28,667 36,783
----------- -----------
Total Current Assets 881,880 1,602,431
----------- -----------
PROPERTY AND EQUIPMENT, at cost 338,830 92,495
Less accumulated depreciation (65,992) (61,192)
----------- -----------
Net Property and Equipment 272,838 31,303
----------- -----------
OTHER ASSETS 30,000
OIL AND GAS PROPERTIES 25,553,639 24,771,766
----------- -----------
TOTAL ASSETS $26,708,357 $26,435,500
=========== ===========
PAGE
<PAGE>
PAGE 3
UNITED HERITAGE CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS - CONTINUED
September 30, March 31,
1998 1998
------------- ---------
UNAUDITED
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses $ 206,089 $ 67,276
----------- -----------
Total Current Liabilities 206,089 67,276
----------- -----------
SHAREHOLDERS' EQUITY
Common stock, $0.001 par value;
125,000,000 shares authorized;
shares issued and outstanding:
97,400,512 shares at September 30, 1998 97,400
96,121,542 shares at March 31, 1998 97,395
Additional paid-in capital 33,404,940 33,399,630
Accumulated deficit (6,998,284) (7,102,037)
Deferred compensation (1,788) (26,764)
----------- -----------
Total Shareholders' Equity 26,502,268 26,368,224
----------- -----------
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY $26,708,357 $26,435,500
=========== ===========
See notes to consolidated condensed financial statements
PAGE
<PAGE>
PAGE 4
UNITED HERITAGE CORPORATION
CONSOLIDATED CONDENSED STATEMENT OF INCOME (UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED SIX MONTHS ENDED
September 30 September 30
1998 1997 1998 1997
---------- -------- ---------- ----------
<S> <C> <C> <C> <C>
REVENUES
Processed beef products $1,086,444 $689,181 $2,235,319 $1,333,325
Oil sales 12,519 12,519
---------- -------- ---------- ----------
TOTAL REVENUE 1,098,963 689,181 2,247,838 1,333,325
---------- -------- ---------- ----------
COSTS AND EXPENSES
Processed beef products 861,971 576,353 1,799,375 1,133,417
Selling 21,766 24,583 43,806 66,414
General and administrative 181,197 124,019 331,799 237,705
---------- -------- ---------- ----------
TOTAL COSTS AND EXPENSES 1,064,934 724,955 2,174,980 1,437,536
---------- -------- ---------- ----------
NET INCOME (LOSS) from Operations 34,029 (35,774) 72,858 (104,211)
OTHER INCOME (EXPENSES)
Interest income 17,554 40 30,891 798
Interest expense
---------- -------- ---------- ----------
NET INCOME (LOSS) $ 51,583 $(35,734) $ 103,749 $ (103,413)
========== ======== ========== ==========
Net Income(Loss) Per Common Share $ 0.00 $ 0.00 $ 0.00 $ 0.00
========== ======== ========== ==========
Weighted average number of common
shares 97,400,512 96,179,042 97,400,293 95,614,608
========== ========== ========== ==========
</TABLE>
See notes to consolidated condensed financial statements
PAGE
<PAGE>
PAGE 5
UNITED HERITAGE CORPORATION
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS (UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
September 30, September 30,
1998 1997
------------- -------------
<S> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES
Net income (loss) $ 103,749 $(103,413)
Adjustments to reconcile net income (loss)
to net cash provided by operating activities:
Depreciation 4,800 4,763
Deferred compensation 24,976 30,792
Stock grants as compensation 5,315
Changes in assets and liabilities:
(Increase) decrease in interest receivable (2,959)
(Increase) decrease in accounts receivable (64,326) 17,254
(Increase) decrease in inventory (12,245) (44,604)
(Increase) decrease in other current assets 8,117 7,244
Increase (decrease) in accounts payable
and accrued expenses 138,816 47,098
---------- ---------
Net cash provided by (used in) operating activities 206,243 (40,866)
---------- ---------
CASH FLOW FROM INVESTING ACTIVITIES
Additions to oil and gas properties (781,873) (130,866)
Additions to property and equipment (246,335) (1,327)
Collections of proceeds from sale of building 30,000
---------- ---------
Net cash (used in) provided by investing activities (998,208) (132,193)
---------- ---------
CASH FLOW FROM FINANCING ACTIVITIES
Proceeds from loans 41,000
Proceeds from note receivable 53,183
Principal payments on borrowings (37,000)
Proceeds from issuance of common stock 94,998
---------- ---------
Net cash provided by (used in) financing activities 53,183 98,998
---------- ---------
Increase (decrease) in cash and cash equivalents (738,782) (74,061)
Cash and cash equivalents at beginning of period 1,390,416 80,722
---------- ---------
Cash and cash equivalents at end of period $ 651,634 $ 6,661
========== =========
</TABLE>
See notes to consolidated condensed financial statements.
PAGE
<PAGE>
PAGE 6
UNITED HERITAGE CORPORATION
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1 - BASIS OF PRESENTATION
The accompanying unaudited condensed 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 Article 10 of Regulation S-X. Accordingly, they do
not include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of
normal recurring accruals) considered necessary for a fair
presentation have been included. Operating results for the six-month
period ended September 30, 1998 are not necessarily indicative of the
results that may be expected for the year ending March 31, 1999. For
further information, refer to the consolidated financial statements
and footnotes thereto included in the Company's annual report on Form
10-K for the year ended March 31, 1998.
NOTE 2 - INVENTORY
Inventory consists of the following:
September 30, 1998 March 31, 1998
------------------ --------------
Lite beef $ 39,092 $ 26,847
======== ========
NOTE 3 - OIL AND GAS PROPERTIES
In September 1995, the Company entered into an agreement to
acquire 100% of Apex Petroleum, L.L.C., ("Apex") owner of certain
unproved oil and gas leases located in Edwards County, Texas. The
agreement was contingent on the Company having certain testing and
development performed and a valuation being obtained which was
acceptable to the Company. Apex was related to the Company through
members who were also shareholders of the Company, including Mr. Mize,
who had a controlling interest in Apex. Pursuant to the agreement,
the Company incurred exploration costs necessary to obtain an
evaluation of reserves. Costs incurred have been capitalized as oil
and gas properties.
A favorable valuation report was received and the transaction
was closed on February 11, 1997. The unproven properties were
recorded at their estimated fair value of $23,676,250.
As of September 30, 1998, a determination cannot be made about
the extent of proved reserves for this project. Consequently, no
amortization has been computed on the exploration costs. The Company
will begin to amortize these costs when testing of the project is
complete and production
PAGE
<PAGE>
PAGE 7
UNITED HERITAGE CORPORATION
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED) (CONTINUED)
commences. All costs capitalized as of September 30, 1998 were
incurred to acquire and evaluate the project and are considered
exploration costs.
As exploration and development progresses the capitalized costs
are periodically assessed for impairment. At September 30, 1998, no
impairment has been required to be recorded. A small amount of oil
has been produced as a part of the testing and development.
NOTE 4 - OTHER ASSETS
At March 31, 1998, the Company retained certain radio station
related assets from foreclosure of the its lien position pertaining
to the radio stations in Canyon and Amarillo, Texas. These assets
included an office building in Canyon, Texas, valued at $30,000, and
miscellaneous furniture, fixtures, and equipment that had negligible
value. These assets were sold for $30,000, and such proceeds were
collected May 7, 1998.
NOTE 5 - CONCENTRATION OF CREDIT RISK
Financial instruments which potentially subject the Company to
concentrations of credit risk consist of cash equivalents and trade
receivables. During the year ended March 31, 1998 and the six months
ended September 30, 1998, the Company maintained money market accounts
with a bank which, at times, exceeded federally insured limits.
Concentrations of credit risk with respect to trade receivables
consist principally of food industry customers operating in the United
States. Receivables from one customer at March 31, 1998 and September
30, 1998 comprised approximately 76% and 100%, respectively, of the
trade receivables balance. No allowance for doubtful accounts has
been provided, since recorded amounts are determined to be fully
collectible.
NOTE 6 - NET INCOME (LOSS) PER COMMON SHARE
Income (loss) per share of common stock is based on the weighted
average number of shares outstanding during the periods ended
September 30, 1998 and September 30, 1997.
PAGE
<PAGE>
PAGE 8
UNITED HERITAGE CORPORATION
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(UNAUDITED) (CONTINUED)
NOTE 7 - INCOME TAXES
As of March 31, 1998, the Company had net operating loss
carryovers of approximately $4,930,474 available to offset future
income for income tax reporting purposes, which will ultimately expire
in 2013 if not previously utilized.
NOTE 8 - DEFERRED COMPENSATION
The Company has issued various stock options and warrants.
Deferred compensation costs resulting from the options and warrants
are recorded as a reduction of shareholders' equity and are being
amortized over their expected lives.
NOTE 9 - ADJUSTMENT TO ACQUISITION
Subsequent to the issuance of the Company's 1997 financial
statements, it was determined that the transaction with APEX (See Note
3) should be accounted for as an acquisition of assets for stock
instead of a reverse acquisition as previously reported. Therefore,
the 1997 balances of oil and gas properties, paid-in capital and
accumulated deficit have been retroactively adjusted to reflect this
change in accounting. The effect of the adjustment on March 31, 1997
balances is as follows:
Oil and Gas Additional Accumulated
Properties Paid-in Capital Deficit
------------ --------------- -----------
As previously reported $ 2,118,797 $ 3,572,698 $ (36,468)
Adjustment 22,174,816 28,853,155 (6,678,339)
----------- ------------ -----------
As restated $24,293,613 $ 32,425,853 $(6,714,807)
=========== ============ ===========
Note 9 - CONTINGENCIES
The preparation of financial statements in conformity with
generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results
could differ from those estimates.
PAGE
<PAGE>
PAGE 9
Part I, Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
UNITED HERITAGE CORPORATION
- ---------------------------
General
- -------
On February 11, 1997 the Company acquired all of the membership
interests of Apex Petroleum, L.L.C. ("Apex"), a Texas limited
liability company, in consideration of 77,500,000 shares of the
Company's $0.001 par value common stock ("Common Stock") issued to the
members of Apex. On February 27, 1997, Apex was merged with and into
UHC Petroleum Corporation, a newly formed Texas corporation, which is
a wholly-owned subsidiary of the Company. The transaction was based
on an independent valuation of Apex by Surtek, Inc. ("Surtek"), a
petroleum engineering company, which performed certain tests on the
primary assets of Apex, leases of an oil field in South Texas
consisting of approximately 10,502 acres, to determine the value of
the Apex assets. Based on the Surtek report, the Company's board of
directors unanimously accepted the valuation and elected to close the
transaction to purchase the Apex interests.
The Company continues to purvey Heritage Lifestyle Lite Beef (r),
the lower-fat beef product marketed by the Company to 111 stores of
a major West Coast supermarket chain located in California, Nevada,
and New Mexico.
The Company is addressing date-sensitive computerized
information issues that potentially could be adversely affected by the
change in the date to the year 2000. All computer software used by
the Company are standard packages developed by major software
companies. Software updates will be secured as needed to be year 2000
compliant. The Company has contacted all of its major vendors and
service providers requesting assurance of their compliance to year
2000 issues as such issues relate to business conducted between
themselves and the Company. The Company has not completed its
assessment, but currently believes that the cost of addressing this
issue will not have a material adverse impact on the Company's
operating results.
Material Changes in Results of Operations
- -----------------------------------------
Revenues for the Company's beef products were $1,086,444 and
$2,235,319 for the quarter and six-month period ended September 30,
1998, respectively. The results for the quarter and six-month period
have increased over that reported in the prior year quarter and six-
month period of $689,181 and $1,333,325 respectively. Gross profit
from beef products was $435,944 for the six-month period ended
September 30, 1998, as compared with $199,908 gross profit for the
same period last year. The cost of beef products as a percentage of
sales was 80.50% for the six months ended September 30, 1998, as
compared to 85.0% for the six months ended September 30, 1997. The
decrease in the cost of beef
PAGE
<PAGE>
PAGE 10
Material Changes in Results of Operations (continued)
- -----------------------------------------------------
product percentage is due primarily to efficiencies gained in
purchasing, fabricating and delivery of beef products during the six
months ended September 30, 1998, as compared with the previous year's
period.
The Company is selling Heritage Lifestyle Lite Beef (r) in 111
selected stores out of the 261-store southern division of a major West
Coast supermarket chain. The southern and northern divisions of this
chain together contain 436 stores. While these prospects have the
potential for significantly increasing the Company's beef sales, there
can be no guarantee that such will be the case.
A small amount of oil has been produced as a part of the testing
and development of the Company's oil and gas properties. Revenue
from the sale of oil was $12,519 for the quarter and six-month period
ended September 30, 1998, respectively. There were no sales of oil
reported during the same period last year.
Interest and other income for the current quarter is above the
level of the prior year period. This results from having increased
cash available, from the sale of radio related assets, invested in
interest-bearing accounts.
Selling expenses of $21,766 for the current quarter have
decreased from that of the prior year period of $24,583. This
decrease results mainly from a reduction in outside sales
representative's costs. Selling expenses of $43,806 for the current
six-month period have decreased from that of the prior year period of
$66,414. This decrease results from an overall reduction in outside
sales representatives costs and a nonrecurring payment of outside
sales representative costs incurred in the prior year period.
General and administrative costs have increased to $181,197 and
$331,799 for the quarter and six-month period ended September 30,
1998, as compared to $124,019 and $237,705 for the same periods
last year. This is a result of increased professional fees, public
relations costs, compensation and benefits, annual report and meeting
expenses, and compensation resulting from stock options.
On a consolidated basis, the Company had a net income for the
current six-month period of $103,749. The comparable period result
for the prior fiscal year was a net loss of $103,413. The primary
reasons for the change from a net loss to a net income is an increase
in the volume of Heritage Lifestyle Lite Beef (r), a decrease in the cost
of production and selling expenses, as previously discussed, and the
sale of small volumes of oil.
PAGE
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PAGE 11
Material Changes in Financial Position
- --------------------------------------
The Company's equity capital has shown an increase of $134,044
since March 31, 1998, the previous fiscal year-end. This increase is
primarily the result of the net income of $103,749 for the six
months ended September 30, 1998, and the recognition of deferred
compensation of $24,976.
The working capital of the Company was $675,791 at September 30,
1998, a decrease from the working capital of $1,535,155 reported at
March 31, 1998, due to capitalization of lease cost on the Company's
oil and gas properties. Current assets decreased $720,551 during the
current six-month period due to additions to the oil and gas
properties and equipment to be used on the oil and gas properties and
current liabilities increased $138,813, resulting in a decrease in the
overall working capital position.
The total assets of the Company were $26,708,357 at September
30, 1998, which is $272,857 greater than total assets at the previous
year end. This increase in total assets is primarily due the
capitalization of oil and gas development costs on the Company's oil
and gas properties for the current six months.
The Company's operating activities provided $206,243 in cash
flow for the six months ended September 30, 1998, as compared to using
$40,866 in cash during the prior year period. The cash provided in
the current period was primarily from the net income and increased
liabilities. The cash used in the prior year period was primarily due
to the net loss. Investing activities used $998,208 during the six
months ended September 30, 1998, due to additions to the oil and gas
properties and equipment to be used on the oil and gas properties.
Investing activities used cash of $132,193 for the six months ended
September 30, 1997, due to additions to property and equipment and
additions to oil and gas properties. Financing activities during the
current six months, provided $53,183 from the collection of a note
related to the sale of assets in the prior year. Financing activities
from the prior year period provided $98,998 from the issuance of
common stock.
PAGE
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PAGE 12
Part II - Other Information
UNITED HERITAGE CORPORATION
- ---------------------------
Item 1. Legal Proceedings
On September 4, 1998, United Heritage Corporation filed
suit in the District Court of Johnson County, Texas, 18th
Judicial District, against Sands Brothers & Co., Ltd., and
Mark G. Halo. On or about August 16, 1996, United Heritage
Corporation entered into a letter agreement engaging Sands
Brothers & Co., Ltd., to act essentially as an investment
banker and a market maker for United Heritage Corporation.
The suit alleges that Sands Brothers & Co., Ltd., breached
its contract and that Sands Brothers & Co., Ltd., through
Mark G. Halo, made false representations and committed
fraud. United Heritage Corporation seeks recission of the
contract and damages based upon fraud and based upon
failure of consideration.
On September 14, 1998, United Heritage Corporation filed
suit in the District Court of Johnson County, Texas, 249th
Judicial District, against Black Sea Investments, Inc., and
Bradford A, Phillips. On behalf of Black Sea, Phillips
represented to United Heritage Corporation in the Fall of
1997 that if United Heritage Corporation would sell shares
of United Heritage Corporation to Black Sea, Black Sea
would not "dump" the United Heritage Corporation shares
once purchased, and that the shares would be held after
registration for investment. United Heritage Corporation
fulfilled its obligation under the agreement. Black Sea
breached the agreement. United Heritage Corporation is
seeking damages and equitable relief based upon fraud.
Item 2. Change in Securities
None
Item 3. Defaults upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
The Annual Meeting of Stockholders of the Company was
held on September 16, 1998. The stockholders voted on the
following matters: (1) electing the directors of the Company
to serve for the ensuing year; (2) ratifying the adoption of
the 1998 Stock Option Plan of the Company; (3) giving
direction to the Board to amend the Articles of
Incorporation either to effect a single reverse stock split
of not less than One-for-Two nor greater than One-for-Ten of
PAGE
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PAGE 13
Part II - Other Information (continued)
the issued and outstanding shares of Common Stock (the
"Reverse Split") or to not effect a Reverse Split; (4)
approving the appointment of Weaver & Tidwell, L.L.P., or
such other firm appointed by the Board of Directors prior to
the meeting, as the independent auditors of the Company for
the fiscal year ending March 31, 1999.
The results of the voting for the election of directors was
as follows:
Name of Nominee For Withheld
--------------- ---------- --------
Walter G. Mize 92,815,574 339,099
Harold Gilliam 92,845,324 309,349
Joe Martin 92,846,274 308,399
C. Dean Boyd 92,806,324 348,349
Theresa D. Turner 92,846,024 308,649
The results of voting for the ratification of the
adoption of the 1998 Stock Option Plan of the Company was
as follows:
Broker
For Against Abstain Non-votes
---------- ------- ------- ---------
92,417,457 577,695 159,521 97,506
The results of the voting for giving discretion to the
Board to amend the Articles of Incorporation either to
effect a single reverse stock split of not less than
One-for-Two nor greater than One-for-Ten of the issued
and outstanding shares of Common Stock (the "Reverse
Split") or to not effect a Reverse Split were as follows:
Broker
For Against Abstain Non-votes
---------- --------- ------- ---------
91,879,538 1,200,543 74,592 97,506
The results of the voting for approving the
appointment of Weaver & Tidwell, L.L.P., or such
other firm appointed by the Board of Directors prior
to the meeting, as the independent auditors of the
Company for the fiscal year ending March 31, 1999 were
as follows:
For Against Abstain
---------- ------- -------
92,884,910 101,324 168,439
All proposals were approved by the vote of the
shareholders.
PAGE
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PAGE 14
Part II - Other Information, continued
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits.
27 Financial Data Schedule *
(b) Reports on Form 8-K
None
* Financial Data Schedule filed herewith.
PAGE
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PAGE 15
UNITED HERITAGE CORPORATION
- ---------------------------
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.
UNITED HERITAGE CORPORATION
/s/ Walter G. Mize
-------------------------
Date: November 2, 1998 Walter G. Mize, President
PAGE
<PAGE>
PAGE 16
INDEX TO EXHIBITS
-----------------
Exhibit Number Description
- -------------- -----------------------
27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAR-31-1999
<PERIOD-START> APR-01-1998
<PERIOD-END> SEP-30-1998
<CASH> 651,634
<SECURITIES> 0
<RECEIVABLES> 159,528
<ALLOWANCES> 0
<INVENTORY> 39,092
<CURRENT-ASSETS> 881,880
<PP&E> 338,830
<DEPRECIATION> 65,992
<TOTAL-ASSETS> 26,708,357
<CURRENT-LIABILITIES> 206,089
<BONDS> 0
0
0
<COMMON> 97,400
<OTHER-SE> 26,404,868
<TOTAL-LIABILITY-AND-EQUITY> 26,708,357
<SALES> 2,247,838
<TOTAL-REVENUES> 2,278,729
<CGS> 1,799,375
<TOTAL-COSTS> 1,843,181
<OTHER-EXPENSES> 331,799
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 103,749
<INCOME-TAX> 0
<INCOME-CONTINUING> 103,749
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 103,749
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
