FORM 10-QSB
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES AND EXCHANGE ACT OF 1934
For the quarterly period ended March 26, 2000
Commission File Number 0-10772
ESSEX CORPORATION
(Exact name of small business issuer as specified in its charter)
Virginia 54-0846569
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
9150 Guilford Road, Columbia, Maryland 21046-1891
(Address of principal executive offices) (Zip Code)
Issuer's telephone number, including area code: (301) 939-7000
Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the past 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
-----
State the number of shares outstanding of each of the issuer's class of Common
Stock as of the latest practicable date.
Outstanding
Class at March 26, 2000
----- -----------------
Common Stock, par value $0.10 per share 4,397,861
Transitional Small Business Disclosure Format (Check One);
YES NO X
----- ---
<PAGE>
ESSEX CORPORATION
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The interim financial statements are unaudited but, in the opinion of
management, reflect all adjustments for a fair presentation of results for such
period. The results of operations for any interim period are not necessarily
indicative of results for the full year. These financial statements should be
read in conjunction with the financial statements and notes thereto contained in
the Company's Annual Report on Form 10-KSB for the fiscal year ended December
26, 1999.
2
<PAGE>
ESSEX CORPORATION
<TABLE>
BALANCE SHEETS
<CAPTION>
March 26, December 26,
2000 1999
--------------- ---------------
(unaudited) (audited)
ASSETS
Current Assets
<S> <C> <C>
Cash $ 721,362 $ 502,663
Accounts receivable, net 504,404 645,564
Inventory 184,821 180,178
Prepayments and other 51,239 46,795
---------------- ---------------
1,461,826 1,375,200
---------------- ---------------
Property and Equipment
Production and special equipment 726,745 729,974
Furniture, equipment and other 238,607 240,095
---------------- ---------------
965,352 970,069
Accumulated depreciation and amortization (908,278) (905,185)
---------------- ---------------
57,074 64,884
---------------- ---------------
Other Assets
Patents, net 133,938 137,658
Other 27,567 31,549
---------------- ---------------
161,505 169,207
---------------- ---------------
TOTAL ASSETS $ 1,680,405 $ 1,609,291
- ------------
================ ===============
================ ===============
<FN>
The accompanying notes are an integral part of these statements.
</FN>
</TABLE>
3
<PAGE>
ESSEX CORPORATION
<TABLE>
BALANCE SHEETS
<CAPTION>
March 26, December 26,
2000 1999
--------------- ---------------
(unaudited) (audited)
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
<S> <C> <C>
Advance from accounts receivable financing $ 21,377 $ 59,470
Accounts payable 128,527 78,339
Accrued wages and vacation 242,347 160,932
Accrued lease settlement 123,448 123,448
10% convertible collateralized debentures 375,714 375,714
Other accrued expenses 180,785 193,182
--------------- ---------------
1,072,198 991,085
Long-term Debt
Capital leases, net of current portion 6,930 8,316
--------------- ---------------
--------------- ---------------
Total Liabilities 1,079,128 999,401
--------------- ---------------
Commitments and Contingencies (Note 4)
Stockholders' Equity
Common stock, $0.10 par value; 25 million shares
authorized; 4,397,861 shares issued and outstanding
439,786 439,786
Redeemable preferred stock, $0.01 par value;
1 million total shares authorized; 2,500 shares
of Series A authorized, $100 liquidation value,
no shares outstanding
-- --
Additional paid-in capital 5,634,234 5,634,234
Accumulated deficit (5,472,743) (5,464,130)
--------------- ---------------
601,277 609,890
--------------- ---------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY
$ 1,680,405 $ 1,609,291
=============== ===============
<FN>
The accompanying notes are an integral part of these statements.
</FN>
</TABLE>
4
<PAGE>
ESSEX CORPORATION
<TABLE>
STATEMENTS OF OPERATIONS
FOR THE THIRTEEN WEEK PERIODS
ENDED MARCH 26, 2000 AND MARCH 28, 1999
<CAPTION>
2000 1999
--------------- --------------
(unaudited) (unaudited)
<S> <C> <C>
Revenues $ 975,423 $ 965,762
Costs of goods sold and services provided (423,523) (505,149)
Selling, general and administrative expenses (552,304) (597,647)
-------------- --------------
Operating Loss (404) (137,034)
Interest expense, net and debenture financing
amortization
(8,209) (12,293)
-------------- --------------
-------------- --------------
Loss Before Income Taxes (8,613) (149,327)
Provision for income taxes -- --
-------------- --------------
Net Loss $ (8,613) $ (149,327)
============== ==============
============== ==============
Weighted Average Number of Shares Outstanding 4,397,861 4,397,861
============== ==============
============== ==============
Basic Loss Per Share $ (0.00) $ (0.03)
============== ==============
Diluted Loss Per Share $ (0.00) $ (0.03)
============== ==============
<FN>
The accompanying notes are an integral part of these statements.
</FN>
</TABLE>
5
<PAGE>
ESSEX CORPORATION
<TABLE>
STATEMENTS OF CASH FLOWS
FOR THE THIRTEEN WEEK PERIODS
ENDED MARCH 26, 2000 AND MARCH 28, 1999
<CAPTION>
2000 1999
-------------- ---------------
(unaudited) (unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
<S> <C> <C>
Net Loss $ (8,613) $ (149,327)
Adjustments to reconcile Net Loss to
Net Cash Provided By (Used In) Operating
Activities:
Depreciation and amortization 13,274 28,693
Gain on sale/retirement of fixed assets (4,986) --
Change in Assets and Liabilities:
Accounts receivable 141,160 (116,327)
Inventory (4,643) (297)
Prepayments and other assets (2,206) (23,259)
Accounts Payable 50,188 25,954
Other Liabilities 78,193 34,667
------------- --------------
Net Cash Provided By (Used In) Operating
Activities
262,367 (199,896)
------------- --------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment -- (8,103)
Proceeds from sale of fixed assets 4,986 --
------------- --------------
Net Cash Provided By (Used In) Investing
Activities 4,986 (8,103)
------------- --------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Short-term repayments (borrowings), net (38,093) 14,016
Payment of capital lease obligations (10,561) (4,057)
------------- --------------
Net Cash (Used In ) Provided By Financing
Activities (48,654) 9,959
------------- --------------
CASH AND CASH EQUIVALENTS
Net increase (decrease) 218,699 (198,040)
Balance - beginning of period 502,663 543,538
------------- --------------
Balance - end of period $ 721,362 $ 345,498
============= ==============
<FN>
The accompanying notes are an integral part of these statements.
</FN>
</TABLE>
6
<PAGE>
ESSEX CORPORATION
NOTES TO INTERIM FINANCIAL INFORMATION
NOTE 1: General
Fiscal Year and Presentation
Essex Corporation (the "Company") is on a 52/53-week fiscal year ending the last
Sunday in December. 2000 is a 53-week fiscal year. 1999 was a 52-week fiscal
year. Certain amounts for 1999 have been reclassified to conform to the 2000
presentation.
Use of Estimates
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.
Estimates are used when accounting for uncollectible accounts receivable,
inventory obsolescence and valuation, depreciation and amortization, intangible
assets, employee benefit plans and contingencies, among others. Actual results
could differ from those estimates.
Important Business Risk Factors
The Company has historically been principally a supplier of technical services
under contracts or subcontracts with departments or agencies of the U.S.
Government, primarily the military services and other departments and agencies
of the Department of Defense. In recent years, the Company's business had been
principally commercial in the satellite communications (SatCom) business area.
This work substantially ended in December 1999.
Since 1989, the Company has expended significant funds to transition into the
commercial marketplace, particularly the productization of its proprietary
technologies in optoelectronic processors. The Company has incurred losses over
the last decade, primarily due to the development and marketing of its
optoelectronics products and services. The long-term success of the Company in
this area is dependent on its ability to successfully develop and market
products related to its optoelectronic processors. The success of these efforts
is subject to changing technologies, availability of financing, competition, and
ultimately market acceptance.
The Company is seeking additional funds from private financing markets to
finance optoelectronic operations and to achieve desired product inventory
levels and initial market penetration. The Company is also seeking to establish
joint ventures or strategic partnerships with major industrial concerns to
facilitate these goals. Failure to commercialize or further significant delays
in the commercialization of the Company's optoelectronic products would have a
significant adverse effect on the Company's future operating results and future
financial position; however, the Company believes that in such event it could
successfully manage and reduce cash requirements for operations by curtailing
expenditures in optoelectronics operations (including general and administrative
expenses), although there can be no assurances in this regard.
NOTE 2: Basic and Diluted Earnings (Loss) Per Share
Basic earnings (loss) per share are computed using the weighted average number
of common shares outstanding during the period. Common stock equivalents were
anti dilutive in both periods.
7
<PAGE>
ESSEX CORPORATION
NOTE 3: Accounts Receivable Financing
The Company has a working capital financing agreement with an accounts
receivable factoring organization. Under such an agreement, the factoring
organization may purchase certain of the Company's accounts receivable subject
to full recourse against the Company in the case of nonpayment by the customers.
The Company generally receives 85%-90% of the invoice amount at the time of
purchase and the balance when the invoice is paid. The Company is charged an
interest fee and other processing charges, payable at the time each invoice is
paid. Funds advanced were $21,000 as of March 26, 2000 and $59,000 as of
December 26, 1999.
NOTE 4: Commitments and Contingencies
Effective July 1994, the Company settled a legal dispute with a former landlord.
Under the Settlement Agreement, the Company remains liable for contingent cash
payments of 25% of future earnings (as defined) and 10-15% of the net proceeds
from the sale of common stock or operating assets. The period for computation of
such contingent payments ends December 2004. The $123,000 accrual as of March
26, 2000 represents the remaining contingent portion which is to be paid over
the applicable consideration period. Of this amount, $30,000 was paid in April
2000.
NOTE 5: Common Stock; Warrants; Preferred Stock
In connection with the outstanding 10% Convertible Collateralized Debentures Due
2000, the Company has reserved approximately 107,000 shares of common stock for
conversion at $3.50 per share. In addition, the Company has issued warrants to
the broker/dealer for 28,571 shares of common stock. The warrants are
exercisable through December 1, 2000 at a price of $3.50 per share, subject to
adjustment under anti-dilution provisions of the Warrant Agreement. The warrant
holders have certain registration rights for these shares of common stock. The
Company has also issued warrants for 78,400 shares to the purchasers of the
Debentures under essentially the same terms and conditions as the warrants
issued to the broker/dealer. The Company has reserved approximately 214,000
shares of common stock in connection with the convertible debentures and the
possible exercise of all such warrants.
A class of preferred stock is approved by the shareholders. The Company's
Articles of Incorporation authorize a class of preferred stock, 1 million
shares, par value $0.01 per share, the series and rights of which may be
designated by the Board of Directors in accordance with applicable state and
federal law. No preferred shares are currently outstanding.
NOTE 6: Income Taxes
The Company is in a net operating loss (NOL) carryforward position for book and
tax purposes. No tax benefit will be recognized until taxable income is
realized.
NOTE 7: Statements of Cash Flows - Supplemental Disclosure
In 1999, the Company entered into capital leases for new equipment for $127,000.
There were no new capital leases entered into in the first quarter of 2000.
8
<PAGE>
ESSEX CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION AND OTHER SECTIONS
CONTAIN FORWARD-LOOKING STATEMENTS THAT ARE BASED ON MANAGEMENT'S EXPECTATIONS,
ESTIMATES, PROJECTIONS AND ASSUMPTIONS. WORDS SUCH AS "EXPECTS", "ANTICIPATES",
"PLANS", "BELIEVES", "ESTIMATES", VARIATIONS OF SUCH WORDS AND SIMILAR
EXPRESSIONS ARE INTENDED TO IDENTIFY SUCH FORWARD-LOOKING STATEMENTS THAT
INCLUDE, BUT ARE NOT LIMITED TO, PROJECTIONS OF REVENUES, EARNINGS, SEGMENT
PERFORMANCE, CASH FLOWS AND CONTRACT AWARDS. SUCH FORWARD-LOOKING STATEMENTS ARE
MADE PURSUANT TO THE SAFE HARBOR PROVISIONS OF THE PRIVATE SECURITIES LITIGATION
REFORM ACT OF 1995. THESE STATEMENTS ARE NOT GUARANTEES OF FUTURE PERFORMANCE
AND INVOLVE CERTAIN RISKS AND UNCERTAINTIES THAT ARE DIFFICULT TO PREDICT.
THEREFORE, ACTUAL FUTURE RESULTS AND TRENDS MAY DIFFER MATERIALLY FROM WHAT IS
INDICATED IN FORWARD-LOOKING STATEMENTS DUE TO A VARIETY OF FACTORS.
STATUS
The Company's revenues historically have come from satellite telecommunications
and optoelectronics business programs and contracts. The telecommunications work
was principally with one major customer, Motorola, and was approximately 45%
($2.2 million) of the Company's revenues for 1999. This telecommunications work
substantially ended in December 1999.
The Company's current business is coming from applications of its proprietary
optoelectronics technology and products. Work based on the patented ImSyn(TM)
Processor has increased with the award of a group of contracts funded under
Small Business Innovation Research (SBIR) and other research programs by the
Army, Navy, DARPA and DOD since October 1999. Aggregate multi-year funding
expected under the terms of the four contracts is $2,430,000. Such work is
generally incrementally funded and spans 1-2 years. The increase in this work
has only partially offset the decline in telecommunications revenues.
The Company has been unable to maintain programs of sufficient volume and to
expand such work to consistently achieve a breakeven or better level of
operations on such revenues. While the Company was able to operate profitably in
the last three quarters of 1999, the Company's backlog of work in 2000 is not
yet sufficient to maintain a breakeven or better level of operations. Since
early 1997, the Company has continued development and product improvement of its
initial ImSyn(TM) optoelectronic processor to the extent possible from internal
funds. The processor is a combination of digital and optical componentry.
Problems in the reliability and performance of certain digital components as
well as the combination of such state-of-the-art subassemblies caused delays in
the availability of the ImSyn(TM) processor to potential early users and
customers. Four units were completed and available in 1998. These first-designed
units need to be upgraded with higher speed electronic circuits, requiring
hardware and software changes and retesting and recalibrating of unit
performance. The lack of upgraded units for initial user testing and evaluation
has hindered potential sales and revenues, and delayed inventory turnover. The
Company has established significant reserves against its ImSyn(TM) inventory for
such changes and delays in the sale of these first units. The Company is working
to reduce the deficit from operations and to improve its cash flows. Backlog and
order issues will continue to be major concerns until substantial improvements
have been achieved.
9
<PAGE>
ESSEX CORPORATION
The Company continues to work with investment groups that have expressed
interest in an international venture to pursue commercial applications of 3D
ground penetrating radar. The proposed project would apply the patented
ImSyn(TM) Processor and the Company's proprietary holographic Virtual Lens
Sensor Technology(TM). Data on the location and condition of underground
utilities, transportation subgrades and construction sites would be collected,
processed, interpreted and archived in its data warehouse. Infrastructure and
natural resources business subscribers would access it through the enterprise's
broadband business-to-business network on the public internet. Success in
financing and launching the enterprise is not assured.
REVENUES
Revenues were $975,000 and $966,000 for the first quarters of 2000 and 1999,
respectively. The first quarter 2000 revenues include approximately $148,000 for
recovery of excess indirect costs on a government contract completed in 1994.
There was no such transaction in the first quarter of 1999. Without this
recovery, first quarter 2000 revenues would have been $827,000 or 14% lower than
the first quarter of 1999. The decline in revenues is due to the substantial
completion of work for Motorola by December 1999. The Company's work for
Motorola for the Iridium and other communication systems accounted for revenues
of $79,000 and $699,000 in the first quarters of 2000 and 1999, respectively.
This represented 8% and 72% of total revenues for the first quarters of 2000 and
1999, respectively.
Increased work in the optoelectronics computer systems area partially offset the
decline in SatCom revenues during the first quarter of 2000. Such revenues were
$680,000 in the first quarter of 2000 compared to $267,000 in the first quarter
of 1999. As of March 26, 2000, the Company had a backlog on programs related to
services and applications of optoelectronic computers of approximately
$2,188,000, up from $723,000 at December 26, 1999. The Company had no firm
orders for ImSyn(TM) units as of the date of this report.
INCOME (LOSS)
There was an operating loss of $400 and $137,000 in the first quarters of 2000
and 1999, respectively. There was a net loss of $9,000 and $149,000 in the first
quarters of 2000 and 1999, respectively. Without the approximately $148,000
recovery of excess costs on a previously completed contract, the first quarter
2000 operating and bottom line losses would have been comparable with 1999 first
quarter results. Cost of goods sold and services provided as a percentage of
revenues (excluding revenue from recovery of prior year excess costs) for the
first quarter of 2000 was 51.2%, which was slightly lower than the 52.3% in
1999. The Company has curtailed selling, general and administrative expenses
("SG&A") where possible while retaining essential technical capabilities and
personnel in the optoelectronics and telecommunications businesses. Overall,
SG&A expenses remain high relative to the revenue volume as the Company seeks to
commercialize its optoelectronic products and services. The high SG&A expenses
contributed to the operating losses in the first quarters of 1999 and 2000.
CORPORATE MATTERS
In 2000, the Company's interest expense declined due to lower average accounts
receivable financings under its working capital financing agreement. Total
interest expense and debenture financing amortization costs were $8,000 in the
first quarter of 2000 compared to $12,000 in the same period of 1999.
10
<PAGE>
ESSEX CORPORATION
The Company recognized the majority of its remaining tax benefit amount
recoverable from the carryback of net operating losses prior to 1994. The
Company is in a net operating loss (NOL) carryforward position. No provision or
benefit from income taxes was recognized in the first quarter of 2000 or 1999.
FINANCIAL CONDITION - LIQUIDITY AND CAPITAL RESOURCES
The Company evaluates its liquidity position using various factors. The
following represents some of the more important factors:
<TABLE>
SELECTED FINANCIAL DATA ($ Thousands)
AS OF
-----------------------------------------------
<CAPTION>
March 26, December 26, March 28,
2000 1999 1999
----------- ------------ ------------
(unaudited) (audited) (unaudited)
<S> <C> <C> <C>
Total Assets $ 1,680 $ 1,609 $ 1,702
=========== ============ ============
Working Capital $ 390 $ 384 $ 536
=========== ============ ============
Current Ratio 1.36:1 1.39:1 1.59:1
=========== ============ ============
Advance from Accounts Receivable
Financing $ 21 $ 59 $ 178
Convertible Debentures 376 376 376
Current and Long-Term Capital Leases 13 23 1
----------- ------------ ------------
Total Debt/Financing $ 410 $ 458 $ 555
=========== ============ ============
Stockholders' Equity $ 601 $ 610 $ 416
=========== ============ ============
</TABLE>
The Company experienced a decrease in its working capital and current ratio at
March 26, 2000 as compared to March 28, 1999. The decrease was primarily due to
the reclassification of the convertible debentures to a current liability as the
debentures are due in November 2000. The Company's working capital and current
ratios were relatively unchanged from December 1999.
The Company has incurred losses over the last decade, primarily due to the
development and marketing of its optoelectronics products and services. The
Company has recently experienced difficulty in sustaining revenue volume in the
satellite communications (SatCom) systems business area.
The Company continues to seek additional funds under appropriate terms from
private financing sources to finance development and to achieve desired product
inventory levels and initial market penetration. The Company is also seeking to
establish joint ventures or strategic partnerships with major industrial
concerns to facilitate these goals. Further significant delays in the
commercialization of the Company's optoelectronic products, failure to market
such products or
11
<PAGE>
ESSEX CORPORATION
failure to raise substantial additional working capital would have a significant
adverse effect on the Company's future operating results and future financial
position.
There are $376,000 of Convertible Debentures that are due November 30, 2000 for
which no funds have been identified or set aside for payment. The Company may
have to use all or a significant portion of its cash at that time to make the
payoff of the debentures. The use of the Company's cash resources without
securing alternative sources of liquidity would likely have a material adverse
impact on the Company's liquidity. The Company is exploring various financing
options including renegotiating an extension of the final payoff date or
restructuring of the debt, but is unable to predict the likelihood of success of
such a negotiation or the terms of such an extension.
The Company has approximately $185,000 of inventory in current assets. This
inventory is comprised of ImSyn(TM) optoelectronic processors and primarily
consists of finished goods and purchased parts. Sales of such units will be
necessary in order to maintain working capital liquidity. There are no firm
orders for such units as of the date of this report.
The Company has a working capital financing agreement with an accounts
receivable factoring organization. Under such an agreement, the factoring
organization may purchase certain of the Company's accounts receivable subject
to full recourse against the Company in the case of nonpayment by the customers.
The Company generally receives 85%-90% of the invoice amount at the time of
purchase and the balance when the invoice is paid. The Company is charged an
interest fee and other processing charges, payable at the time each invoice is
paid. Funds advanced were $21,000 as of March 26, 2000.
Effective July 1994, the Company settled a legal dispute with a former landlord.
There is a $123,000 accrual as of March 26, 2000 which represents the remaining
contingent portion to be paid over the applicable consideration period. Under
the Settlement Agreement, the Company remains liable for such contingent cash
payments from 25% of future earnings (as defined) and 10-15% of the net proceeds
from the sale of common stock or operating assets. The period for computation of
such contingent payments ends December 2004. Of the remaining $123,000 amount,
$30,000 was paid in April 2000.
The Company believes that it will be able to meet its 2000 funding requirements
and obligations from the aforementioned sources of revenue and capital, and if
necessary, by further cost reductions. However, there can be no assurances in
this regard and the Company expects that it will need significant additional
financing in the future.
THE PRECEDING PARAGRAPHS DISCUSSING THE COMPANY'S FINANCIAL CONDITION CONTAIN
FORWARD-LOOKING STATEMENTS. THE FACTORS AFFECTING THE ABILITY OF THE COMPANY TO
MEET ITS FUNDING REQUIREMENTS AND MANAGE ITS CASH RESOURCES INCLUDE, AMONG OTHER
THINGS, THE AMOUNT AND TIMING OF PRODUCT SALES, INVENTORY TURNOVER, THE
MAGNITUDE OF FIXED COSTS AND THE ABILITY TO OBTAIN WORKING CAPITAL, ALL OF WHICH
INVOLVE RISKS AND UNCERTAINTIES THAT ARE DIFFICULT TO PREDICT.
12
<PAGE>
ESSEX CORPORATION
PART II - OTHER INFORMATION
Item 6. Exhibits and Report on Form 8-K
(a) Exhibits
(i) Exhibit 27 - Financial Data Schedule
27.1 Financial Data Schedule
(b) Reports on Form 8-K
None
SIGNATURE
In accordance with the requirements of the Securities Exchange Act of 1934, the
Registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
ESSEX CORPORATION
(Registrant)
Date: May 3, 2000
/s/ Joseph R. Kurry, Jr.
-------------------------------------
Joseph R. Kurry, Jr.
Senior Vice President
Treasurer and Chief Financial Officer
(Mr. Kurry is the Principal Financial and Accounting Officer and has been duly
authorized to sign on behalf of the Registrant.)
13
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-START> DEC-27-1999
<PERIOD-END> MAR-26-2000
<CASH> 721
<SECURITIES> 0
<RECEIVABLES> 504
<ALLOWANCES> (50)
<INVENTORY> 185
<CURRENT-ASSETS> 1,461
<PP&E> 965
<DEPRECIATION> (908)
<TOTAL-ASSETS> 1,680
<CURRENT-LIABILITIES> 1,072
<BONDS> 0
0
0
<COMMON> 440
<OTHER-SE> 161
<TOTAL-LIABILITY-AND-EQUITY> 601
<SALES> 975
<TOTAL-REVENUES> 975
<CGS> 424
<TOTAL-COSTS> 976
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 8
<INCOME-PRETAX> (9)
<INCOME-TAX> 0
<INCOME-CONTINUING> (9)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (9)
<EPS-BASIC> 0.00
<EPS-DILUTED> 0.00
</TABLE>
