<PAGE>
<PAGE> 1
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
__________________________________________________
[X] Quarterly report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
For the quarterly period ended March 31, 1997
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 0-7616
I.R.S. Employer Identification Number 23-1739078
Avatar Holdings Inc.
(a Delaware Corporation)
255 Alhambra Circle
Coral Gables, Florida 33134
(305) 442-7000
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:
9,095,102 shares of the Company's common stock ($1.00 par value)
were outstanding as of April 30, 1997.
1 OF 16<PAGE>
<PAGE> 2
AVATAR HOLDINGS INC. AND SUBSIDIARIES
INDEX
-----
PAGE
----
PART I. Financial Information
Item 1. Financial Statements (Unaudited):
Consolidated Balance Sheets --
March 31, 1997 and December 31, 1996..................... 3
Consolidated Statements of Operations --
Three months ended March 31, 1997 and 1996.............. 4
Consolidated Statements of Cash Flows --
Three months ended March 31, 1997 and 1996............... 5
Notes to Consolidated Financial Statements................. 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations............. 12
PART II. Other Information
Item 6. Exhibits and Reports on Form 8-K................... 14
Exhibit Index............................................... 15
2<PAGE>
<PAGE> 3
PART I -- FINANCIAL INFORMATION
-----------------------------------
ITEM 1. FINANCIAL STATEMENTS
------------------------------
AVATAR HOLDINGS INC. AND SUBSIDIARIES
Consolidated Balance Sheets
(Unaudited)
(Dollars in thousands)
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
----------- ----------
<S> <C> <C>
Assets
------
Cash $3,647 $7,567
Restricted cash 813 730
Investments - trading 4,658 4,535
Contracts, mortgage notes and
other receivables, net 52,322 56,544
Land and other inventories 176,868 168,211
Property, plant and equipment, net 187,011 186,615
Other assets 15,358 15,215
Regulatory assets 3,651 3,768
----------- ----------
Total Assets $444,328 $443,185
=========== ==========
Liabilities and Stockholders' Equity
------------------------------------
Liabilities
-----------
Notes, mortgage notes and other debt:
Real estate and corporate $76,668 $75,143
Development and construction loans 36,027 31,688
Utilities 41,896 42,152
Estimated development liability for
sold land 8,768 8,459
Accounts payable 7,134 7,465
Accrued and other liabilities 31,147 32,087
Deferred customer betterment fees 18,264 18,430
Minority interest in consolidated
subsidiaries 7,264 9,064
----------- ----------
Total Liabilities 227,168 224,488
Commitments and contingent liabilities
Contributions in aid of construction 59,695 59,245
Stockholders' Equity
--------------------
Common Stock, par value $1 per share
Authorized: 15,500,000 shares
Issued: 12,715,448 shares 12,715 12,715
Additional paid-in capital 207,271 207,271
(Deficit) retained earnings (548) 1,439
----------- ----------
219,438 221,425
Treasury stock, at cost, 3,620,346 shares 61,973 61,973
----------- ----------
Total Stockholders' Equity 157,465 159,452
----------- ----------
Total Liabilities and Stockholders' Equity $444,328 $443,185
=========== ==========
</TABLE>
See notes to consolidated financial statements.
3<PAGE>
<PAGE> 4
AVATAR HOLDINGS INC. AND SUBSIDIARIES
Consolidated Statements of Operations
For the Three Months Ended March 31, 1997 and 1996
(Unaudited)
(Dollars in thousands except per share data)
<TABLE>
<CAPTION>
1997 1996
----------- ----------
<S> <C> <C>
Revenues
--------
Real estate sales $22,704 $17,321
Deferred gross profit 1,028 (312)
Utility revenues 9,034 8,201
Interest income 1,874 2,288
Trading account profit, net 92 1,001
Other 171 400
----------- ----------
Total revenues 34,903 28,899
Expenses
--------
Real estate expenses 25,039 18,150
Utility expenses 6,435 6,141
General and administrative expenses 2,584 2,553
Interest expense 2,641 2,926
Other 191 205
----------- ----------
Total expenses 36,890 29,975
----------- ----------
Loss before income taxes (1,987) (1,076)
Provision for income taxes - -
----------- ----------
Net loss ($1,987) ($1,076)
=========== ==========
Per share amounts:
Net loss ($.22) ($.12)
=========== ==========
</TABLE>
See notes to consolidated financial statements.
4<PAGE>
<PAGE> 5
AVATAR HOLDINGS INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows (Unaudited)
For the Three Months Ended March 31, 1997 and 1996
(Dollars in Thousands)
<TABLE>
<CAPTION>
1997 1996
----------- ----------
<S> <C> <C>
OPERATING ACTIVITIES
--------------------
Net loss ($1,987) ($1,076)
Adjustments to reconcile net loss to
net cash used in operating activities:
Depreciation and amortization 2,693 2,455
Deferred gross profit (1,028) 312
Cost of sales not requiring cash 1,256 1,025
Trading account profit, net (92) (1,001)
Changes in operating assets and
liabilities:
Restricted cash (83) 1,641
Investments - trading - 7,100
Principal payments on contracts
receivable 4,928 4,347
Receivables (151) (2,200)
Other receivables 473 (1,132)
Inventories (9,604) (15,537)
Other assets (143) (370)
Accounts payable and accrued and other
liabilities (1,351) 336
----------- ----------
NET CASH USED IN OPERATING ACTIVITIES (5,089) (4,100)
INVESTING ACTIVITIES
--------------------
Investment in property, plant and equipment (2,639) (2,652)
----------- ----------
NET CASH USED IN INVESTING ACTIVITIES (2,639) (2,652)
FINANCING ACTIVITIES
--------------------
Net proceeds from revolving lines of credit and
long-term borrowings 19,370 22,569
Principal payments on revolving lines of credit
and long-term borrowings (13,762) (11,887)
Redemption of Subsidiary's
9% cumulative prefered stock (1,800) -
----------- ----------
NET CASH PROVIDED BY FINANCING ACTIVITIES 3,808 10,682
----------- ----------
(DECREASE)/INCREASE IN CASH (3,920) 3,930
Cash at beginning of period 7,567 2,467
----------- ----------
CASH AT END OF PERIOD $3,647 $6,397
=========== ==========
</TABLE>
5<PAGE>
<PAGE> 6
AVATAR HOLDINGS INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows (Unaudited) -- continued
(For the Three Months Ended March 31, 1997 and 1996
(Dollars in thousands)
<TABLE>
<CAPTION>
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
--------------------------------------------------
Cash paid during the period for: 1997 1996
----------- ----------
<S> <C> <C>
Interest (net of amount capitalized of
$909 and $1,019 in 1997
and 1996, respectively) $532 $791
=========== ==========
Income taxes - -
=========== ==========
SUPPLEMENTAL SCHEDULE OF NON-CASH FINANCING ACTIVITIES
------------------------------------------------------
1997 1996
----------- ----------
Contributions in aid of construction $1,039 $101
=========== ==========
</TABLE>
See notes to consolidated financial statements.
6<PAGE>
<PAGE> 7
AVATAR HOLDINGS INC. AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Unaudited)
------------------------------------------------------
(Dollars in thousands except per share data)
Basis of Statement Presentation and Summary of
----------------------------------------------
Significant Accounting Policies
-------------------------------
The consolidated balance sheets as of March 31, 1997 and
December 31, 1996, and the related consolidated statements of
operations for the three month periods ended March 31, 1997 and
1996 and the consolidated statements of cash flows for the three
month periods ended March 31, 1997 and 1996 have been prepared in
accordance with generally accepted accounting principles for
interim financial information, 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 statement
presentation. In the opinion of management, all adjustments
necessary for a fair presentation of such financial statements
have been included. Such adjustments consisted only of normal
recurring items. Interim results are not necessarily indicative
of results for a full year.
For a complete description of the Company's other accounting
policies, refer to Avatar Holdings Inc.'s 1996 Annual Report on
Form 10-K and the notes to Avatar's consolidated financial
statements included therein.
Reclassifications
-----------------
Certain amounts presented for 1996 have been reclassified in
the financial statements for comparative purposes.
Net Loss Per Common Share
-------------------------
For the three months ended March 31, 1997 and 1996, net
loss per common share is computed on the basis of the weighted
average number of shares outstanding of 9,095,102.
Restricted Cash
---------------
Restricted cash, at March 31, 1997, includes utility
deposits of $50, as well as housing and vacation ownership
deposits of $694 and $69, respectively, which have been placed in
escrow. The housing deposits will become available to the
Company when the housing contracts close.
Stock Options
-------------
The Company has elected to follow Accounting Principles Board
Opinion No 25, "Accounting for Stock Issued to Employees" and
related interpretations in accounting for its employee stock
options. Under APB 25, because the exercise price of the
Company's stock options is higher than the market price of the
Company's common stock on March 31, 1997, no compensation expense
has been recognized.
The Company's 1997 Incentive and Capital Accumulation Plan
( the "Incentive Plan" ) which was adopted by the Incentive
Plan Committee and ratified by the Board of Directors on
7<PAGE>
<PAGE> 8
Notes to Consolidated Financial Statements (Unaudited)
-----------------------------------------------
-- continued
Stock Options -- continued
-------------
February 13, 1997, is subject to stockholder approval at the
Annual Meeting to be held May 29, 1997. The Incentive Plan makes
available 425,000 shares of Avatar's common stock, subject to
certain adjustments. Subject to the approval of the Incentive Plan
by Avatar stockholders, the Company's President was granted an
option to purchase 225,000 shares of common stock at $34 per
share. The option has a 10 year term and vests in five equal
annual installments beginning in 1998.
Use of Estimates
----------------
The preparation of the financial statements in conformity
with generally accepted accounting principles requires management
to make estimates and assumptions that affect the amounts
reported in the financial statements and accompanying notes.
Accordingly, actual results could differ from those reported.
Investments - trading
---------------------
The Company classifies all of its investment portfolio as
trading. This category is defined as including debt and
marketable equity securities held for resale in anticipation of
earning profits from short-term movements in market prices.
Trading account securities are carried at fair market value, and
both realized and unrealized gains and losses are included in net
trading account profit. Fair values for actively traded debt
securities and equity securities are based on quoted market
prices on national markets. Fair values for thinly traded
investment securities are generally based on prices quoted by
investment brokerage companies .
Avatar's investment portfolio at March 31, 1997 and December
31, 1996 included bonds rated B- or above by Moody's and/or
Standard and Poor's, non-rated bonds of companies which are in
bankruptcy and have defaulted as to payments of principal and
interest on such bonds, and money market accounts. At December
31, 1996, the portfolio also included equity securities.
The following table sets forth the fair values of
investments (including securities sold short which are valued at
the cost to purchase):
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
---------- ---------
<S> <C> <C>
Non-rated bonds 82 77
Equity securities - 81
Other rated bonds 2,208 2,172
Money market accounts 2,368 2,205
---------- ---------
Total market value $4,658 $4,535
========== =========
Aggregate cost $4,042 $3,975
========== =========
</TABLE>
8<PAGE>
<PAGE> 9
Notes to Consolidated Financial Statements (Unaudited)
-----------------------------------------------
-- continued
Contracts, Mortgage Notes and Other Receivables
-----------------------------------------------
Contracts, mortgage notes, and other receivables are summarized
as follows:
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
---------- ---------
<S> <C> <C>
Contracts and mortgage notes receivable $67,996 $74,029
Notes and other receivables 7,426 7,928
---------- ---------
75,422 81,957
---------- ---------
Less:
Deferred gross profit 20,699 21,878
Allowance for doubtful accounts 1,144 1,450
Market valuation reserve 36 140
Other 1,221 1,945
---------- ---------
23,100 25,413
---------- ---------
$52,322 $56,544
========== =========
</TABLE>
Land and Other Inventories
--------------------------
Inventories consist of the following:
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
--------- -----------
<S> <C> <C>
Land developed and in process of development $106,784 $103,394
Land held for future development or sale 33,544 33,544
Dwelling units completed or under construction 35,852 30,500
Other 688 773
--------- -----------
$176,868 $168,211
========= ===========
</TABLE>
Minority Interest in Consolidated Subsidiaries
-----------------------------------------------
Minority interest in consolidated subsidiaries is
represented by preferred stock of Avatar Utilities' subsidiaries.
Total preferred stock outstanding is as follows:
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
--------- -----------
<S> <C> <C>
9% Cumulative preferred stock $7,200 $9,000
Other 64 64
--------- -----------
$7,264 $9,064
========= ===========
</TABLE>
9<PAGE>
<PAGE> 10
Notes to Consolidated Financial Statements (Unaudited)
-----------------------------------------------
-- continued
Minority Interest in Consolidated Subsidiaries -- continued
----------------------------------------------
Avatar's utility subsidiary's 9% cumulative preferred stock
issue provides for redemption to occur no earlier than March 1,
1997, in whole or in part; a minimum of $1,800 of the preferred
stock must be redeemed per annum beginning in 1997. During the
first quarter Avatar redeemed $1,800 of the preferred stock. A
redemption of all outstanding shares shall occur no later than
March 1, 2001.
Charges to operations recorded as "Other expenses" relate to
preferred stock dividends of subsidiaries for the three months
ended March 31, 1997 and 1996, which amount to $191 and $205 ,
respectively.
Income Taxes
------------
Deferred income taxes reflect the net tax effect of
temporary differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts used
for income tax purposes. Significant components of the Company's
deferred income tax assets and liabilities as of March 31, 1997
and 1996 are as follows:
<TABLE>
<CAPTION>
1997 1996
--------- -----------
<S> <C> <C>
Deferred income tax assets
Net operating loss carryforward $15,000 $17,000
Tax over book basis of land inventory 24,000 23,000
Unrecoverable land development costs 3,000 3,000
Tax over book basis of depreciable assets 7,000 7,000
Alternative minimum tax and investment
tax credit carryforward 5,000 5,000
Other 3,000 2,000
--------- -----------
Total deferred income taxes 57,000 57,000
Valuation allowance for deferred
income tax assets (42,000) (42,000)
--------- -----------
Deferred income tax assets after
valuation allowance 15,000 15,000
Deferred income tax liabilities
Book over tax income recognized on homesite
and vacation ownership sales (6,000) (5,000)
Deferred carrying charges on utility plant (2,000) (3,000)
Other (7,000) (7,000)
--------- -----------
Total deferred income tax liabilities (15,000) (15,000)
--------- -----------
Net Deferred income taxes $0 $0
========= ===========
</TABLE>
10<PAGE>
<PAGE> 11
Notes to Consolidated Financial Statements (Unaudited)
-----------------------------------------------
-- continued
Income Taxes - (continued
------------
A reconciliation of income tax expense to the expected
income tax expense (credit) at the federal statutory rate of 34%
for the three months ended March 31, 1997 and 1996 is as follows:
<TABLE>
<CAPTION>
Three Months
1997 1996
--------- -----------
<S> <C> <C>
Income tax (credit) computed at statutory rate ($676) ($366)
Income tax effect of non-deductible dividends
on preferred stock of subsidiary 65 70
State income tax (credit), net of federal effect (70) (30)
Other, net (319) 326
Change in valuation allowance on deferred
tax assets 1,000 -
--------- -----------
Provision for income taxes $0 $0
========= ===========
</TABLE>
Contingencies
-------------
Avatar is involved in various pending litigation matters
primarily arising in the normal course of its business. Although
the outcome of these and the following matter cannot be
determined, management believes that the resolution of these
matters will not have a material effect on Avatar's business or
financial position.
On October 1, 1993, the United States, on behalf of the
U.S. Environmental Protection Agency, filed a civil action
against Florida Cities Water Company ("Florida Cities"), a
utility subsidiary of Avatar Holdings Inc. ("Avatar"), in the
U.S. District Court for the Middle District of Florida, United
States v. Florida Cities Water Company, Civil Action No. 93-281-
CIV-FTM-21, alleging that Florida Cities' Waterway Estates
treatment plant, located in Lee County, Florida operated in
violation of the Federal Clean Water Act ("Act"), 33 U.S.C. S1251
et seq. On May 5 and June 26, 1996, the United States amended
its complaint to include allegations against Florida Cities for
violations of the Act at two other Florida wastewater
treatment plants, Barefoot Bay, located in Brevard County,
and Carrollwood, located in Hillsborough County. In addition,
the government amended the complaint to include Avatar, the
parent corporation, as a defendant. A trial was held in March
and April 1996. On August 20, 1996, the Court issued its final
judgment, incorporating earlier rulings. The Court found Avatar
not liable on any of the government's claims and entered judgment
in Avatar's favor. The Court found Florida Cities not liable on
certain of the government's claims, but liable on other claims,
and awarded the government $310 in civil penalties against
Florida Cities. On October 18, 1996, the government filed a
notice of appeal to the U.S. Court of Appeals for the Eleventh
Circuit. Avatar and Florida Cities believe that there are strong
arguments to support the affirmance of the district court
judgment on appeal.
11<PAGE>
<PAGE> 12
Item 2. Management's Discussion and Analysis of Financial
------- --------------------------------------------------------
Condition and Results of Operations (dollars in
--------------------------------------------------------
thousands except per share data)
--------------------------------
RESULTS OF OPERATIONS
---------------------
Operations for the three month period ended March 31, 1997,
resulted in a net loss of $1,987 or $.22 per share, compared
to a net loss of $1,076 or $.12 per share for the same period
of 1996. The decrease in operating results for the three months
was primarily attributable to a decrease in real estate operating
results and trading account profits, partially offset by an
increase in deferred gross profit and utility operating results.
Avatar's real estate revenues for the three months ended
March 31, 1997, increased $5,383 or 31.1%, while real estate
expenses increased $6,889 or 38.0%, when compared to the same
period of 1996. The increase in real estate revenues for the
three month period ended March 31, 1997 is generally a result of
increased housing and vacation ownership sales. This increase
was mitigaed by a bulk land sale which occured during the first
quarter of 1996. The increase in real estate expenses for the
three month period ended March 31, 1997,when compared to the same
period of 1996, is essentially a result of related costs
associated with the increased sales volume.
Data from home-building operations for the three months
ended March 31, 1997 and 1996 is summarized as follows :
<TABLE>
<CAPTION>
Three Months
-----------------------
1997 1996
--------- ---------
<S> <C> <C>
Units closed
------------
Number of units 108 33
Aggregate dollar volume $13,983 $3,120
Average price per unit $129 $95
Units sold, net
---------------
Number of units 193 134
Aggregate dollar volume $23,073 $17,400
Average price per unit $120 $130
Backlog March 31,
------- -----------------------
1997 1996
--------- ---------
Number of units 379 253
Aggregate dollar volume $45,852 $46,258
Average price per unit $121 $183
</TABLE>
Utility revenues for the three months ended March 31, 1997,
increased $833 or 10.2% when compared to the same period of 1996.
The increase in utility revenues is primarily attributable to the
implementation of rate increases, increased contract services, as
well as customer growth. Utility expenses for the three months
ended March 31, 1997,increased $294 or 4.8%, when compared to the
same period of 1996. The increase in utility expenses is due to
higher utility operating costs.
12<PAGE>
<PAGE> 13
Item 2. Management's Discussion and Analysis of Financial
------- -------------------------------------------------------
Condition and Results of Operations (dollars in
-------------------------------------------------------
thousands except per share data) -- continued
--------------------------------
RESULTS OF OPERATIONS - continued
---------------------
Interest income for the three months ended March 31, 1997,
decreased $414 or 18.1% when compared to the same period for
1996. The decline in interest income is due in part to lower
average aggregate amounts outstanding in the Company's contract
and mortgage notes receivable portfolio. Avatar's contracts and
mortgage notes receivable portfolio amounted to $67,996 at
March 31, 1997, compared to $86,052 at March 31, 1996.
Trading account profit, net for the three months ended March
31, 1997, decreased $909 or 90.8% compared to the same period for
1996. Trading account profit represents interest income and
realized and unrealized gains and losses related to the trading
investment portfolio, net of commissions payable to brokers.
Interest expense for the three months ended March 31, 1997,
decreased $285 or 9.7% compared to the same period of 1996. The
decrease for the three months is primarily due to a reduction
of approximately $29,000 in the outstanding balance of notes,
mortgage notes and other debt, at March 31, 1997 as compared to
March 31, 1996. This decrease was partially mitigated by an
increase in interest rates.
LIQUIDITY AND CAPITAL RESOURCES
-------------------------------
Avatar's primary business activities, which include
homebuilding, vacation ownership, land development, resort
operations and utility services, are capital intensive in nature.
Avatar expects to fund its operations and capital requirements
through a combination of cash and investment securities on hand,
operating cash flows, proceeds from the sale of certain non-core
assets and external borrowings. There is no assurance that the
sale of certain non-core assets will be achieved.
Avatar had approximately $4,658 in investments, at March
31, 1997, which were classified as trading. The Company intends
to continue to actively trade such securities in an effort to
generate profits and will reinvest such profits until such time
as the Company's cash requirements necessitate the use or partial
use of the portfolio proceeds.
Substantially all of the investment portfolio collateralizes
a $3,350 line of credit which had an outstanding balance at March
31, 1997 of $3,350 and will mature during the second quarter of
1998.
13<PAGE>
<PAGE> 14
PART II -- OTHER INFORMATION
----------------------------
Item 6. Exhibits and Reports on Form 8-K
------- --------------------------------
Exhibits
--------
27 Financial Data Schedule (filed herewith)
Reports on Form 8-K
-------------------
No reports on Form 8-K were filed during the quarter ended
March 31, 1997.
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.
AVATAR HOLDINGS INC.
Date: May 15, 1997 By: /s/ Lawrence L. Colditz
------------------ ------------------------
Lawrence L. Colditz
Controller
Date: May 15, 1997 By: /s/ Charles L. McNairy
------------------ ------------------------
Charles L. McNairy
Executive Vice President,
Treasurer and Chief Financial
Officer
14<PAGE>
<PAGE> 15
Exhibit Index
27 Financial Data Schedule (filed herewith)............ 16
15
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 4,460
<SECURITIES> 4,658
<RECEIVABLES> 75,422
<ALLOWANCES> (23,100)
<INVENTORY> 176,868
<CURRENT-ASSETS> 0
<PP&E> 187,011
<DEPRECIATION> 0
<TOTAL-ASSETS> 444,328
<CURRENT-LIABILITIES> 0
<BONDS> 154,591
<COMMON> 12,715
0
0
<OTHER-SE> 144,750
<TOTAL-LIABILITY-AND-EQUITY> 444,328
<SALES> 22,704
<TOTAL-REVENUES> 34,903
<CGS> 15,165
<TOTAL-COSTS> 21,600
<OTHER-EXPENSES> 5,294
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,641
<INCOME-PRETAX> (1,987)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,987)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,987)
<EPS-PRIMARY> (0.22)
<EPS-DILUTED> (0.22)
<FN>
NOTE: Total Current Assets and Total Current Liabilities are not
applicable because Registrant does not present a classified
balance sheet.
16
</TABLE >
</TABLE>
