FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended: June 28, 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:________________________________
TRIDEX CORPORATION
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Connecticut 06-0682273
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
61 Wilton Road, Westport CT 06880
- --------------------------------------------------------------------------------
(Address of principal executive offices)
(Zip Code)
(203) 226-1144
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
Former address:
- --------------------------------------------------------------------------------
(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 |_|
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDING DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
YES |_| NO |_|
APPLICABLE ONLY TO CORPORATE ISSUERS:
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding July 26, 1997
- --------------------- -------------------------
Common stock, no par value 5,351,410
<PAGE>
TRIDEX CORPORATION AND SUBSIDIARIES
INDEX
Page No.
PART I. Financial Information:
Item 1. Financial Statements
Consolidated Condensed Balance Sheets
June 28, 1997 and December 31, 1996 3
Consolidated Statements of Income for the
Quarters and Six Months Ended June 28, 1997
and June 29, 1996 4
Consolidated Statements of Cash Flows for the
Quarters and Six Months Ended June 28, 1997
and June 29, 1996 5
Notes to Consolidated Condensed Financial Statements 6
Item 2. Management's Discussion and Analysis of the
Results of Operations and Financial Condition 7
PART II. Other Information:
Item 4. Submission of Matters to a Vote of Security Holders 10
Item 6. Exhibits and Reports on Form 8-K 10
Signatures 11
EXHIBIT INDEX
Exhibit 11 Computation of Per Share Earnings 12
<PAGE>
TRIDEX CORPORATION AND SUBSIDIARIES
Consolidated Condensed Balance Sheets
(Dollars in Thousands)
(Unaudited)
June 28, 1997 December 31, 1996
------------- -----------------
ASSETS
Current assets:
Cash and cash equivalents $ 14,100 $ 2,787
Receivables 3,758 2,783
Inventories (Note 4) 3,779 4,258
Deferred tax assets 140 140
Other current assets 119 146
-------- --------
Total current assets 21,896 10,114
-------- --------
Plant and equipment, net 1,101 1,044
Excess of cost over fair value of net
assets acquired 2,765 3,014
Other assets 1,095 1,923
Investment in net assets of discontinued
operations:
Cash Bases GB Ltd. (Note 2) 605 6,153
TransAct Technologies Inc. (Note 2) 11,573
-------- --------
$ 27,462 $ 33,821
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of long term debt $ 3,628
Accounts payable $ 2,301 2,189
Accrued liabilities 1,357 2,234
-------- --------
Total current liabilities 3,658 8,051
-------- --------
Shareholders' equity:
Common stock, at stated value 1,377 1,043
Additional paid-in capital 25,069 23,361
Retained earnings (deficit) (206) 2,239
Unearned compensation (627)
Receivables from sale of stock (867)
Common shares held in treasury, at cost (942) (873)
-------- --------
23,804 25,770
-------- --------
$ 27,462 $ 33,821
======== ========
See notes to consolidated condensed financial statements.
<PAGE>
TRIDEX CORPORATION AND SUBSIDIARIES
Consolidated Statements of Income
(Dollars in Thousands Except Per Share Amounts)
(Unaudited)
<TABLE>
<CAPTION>
Quarters Ended Six Months Ended
------------------------- -------------------------
June 28, June 29, June 28, June 29,
1997 1996 1997 1996
------------------------- -------------------------
<S> <C> <C> <C> <C>
Net sales $ 6,174 $ 4,908 $ 11,720 $ 9,061
------------------------- -------------------------
Operating costs and expenses:
Cost of sales 4,671 3,644 9,011 6,543
Engineering, design and product development costs 156 130 316 278
Selling, administrative and general expenses 1,484 1,079 3,089 2,153
------------------------- -------------------------
6,311 4,853 12,416 8,974
------------------------- -------------------------
Operating income (loss) (137) 55 (696) 87
Other charges (income):
Interest expense, net (156) 282 (165) 575
Other, net 6 16 8 24
------------------------- -------------------------
(150) 298 (157) 599
------------------------- -------------------------
Income (loss) from continuing operations
before income taxes 13 (243) (539) (512)
Provision (benefit) for income taxes 13 (75) (364) (135)
------------------------- -------------------------
Loss from continuing operations 0 (168) (175) (377)
Discontinued operations (Note 2):
Equity in subsidiaries' income from and loss
on the sale of discontinued operations (206) 975 607 1,980
------------------------- -------------------------
Net income (loss) $ (206) $ 807 $ 432 $ 1,603
========================= =========================
Earnings (loss) per common and common equivalent share:
Primary:
Income (loss) from continuing operations $ 0.00 $ (0.04) (0.03) $ (0.09)
Income (loss) from discontinued operations (0.04) 0.24 0.11 0.49
------------------------- -------------------------
$ (0.04) $ 0.20 $ 0.08 $ 0.40
========================= =========================
Weighted average common and common equivalent shares
outstanding
Primary 5,385,000 4,082,000 5,111,000 4,010,000
========================= =========================
</TABLE>
See notes to consolidated condensed financial statements.
<PAGE>
TRIDEX CORPORATION AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(Dollars in Thousands)
(Unaudited)
<TABLE>
<CAPTION>
Six Months Ended
------------------------------
June 28, 1997 June 29, 1996
------------- -------------
Cash flows from operating activities:
<S> <C> <C>
Net income $ 432 $ 1,603
Adjustments to reconcile net income to net cash used in
operating activities:
Equity in subsidiaries' income from discontinued operations (806) (2,080)
Loss on sale of discontinued operations 199
Stock incentive compensation expense 599
Depreciation and amortization 415 618
Gain on disposal of assets (3)
Changes in operating assets and liabilities:
Receivables (975) (925)
Inventory 479 (153)
Other current assets 27 338
Other assets 17 (114)
Accounts payable, accrued liabilities and income taxes payable (431) (496)
-------- --------
Net cash used in operating activities (44) (1,212)
-------- --------
Cash flows from investing activities:
Purchases of plant and equipment (207) (75)
Proceeds from sale of discontinued operations 5,200
Receipt of principal of note receivable from TransAct 1,000
-------- --------
Net cash provided by (used in) investing activities 5,993 (75)
-------- --------
Cash flows from financing activities:
Principal payments on long term borrowings (332)
Proceeds from exercise of stock options and warrants 5,529 178
Net transactions with discontinued operations (96) 662
Purchase of treasury shares (69)
-------- --------
Net cash provided by financing activities 5,364 508
-------- --------
Increase (decrease) in cash and cash equivalents 11,313 (779)
Cash and cash equivalents at beginning of period 2,787 822
-------- --------
Cash and cash equivalents at end of period 14,100 $ 43
======== ========
Supplemental cash flow information:
Interest paid $ 72 $ 464
Income taxes paid 88 202
Supplemental non-cash investing and financing activities:
Conversion of convertible notes and debentures to common stock $ 3,710 $ 860
</TABLE>
See notes to consolidated condensed financial statements.
<PAGE>
TRIDEX CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Unaudited)
1. In the opinion of the Company, the accompanying unaudited consolidated
condensed financial statements contain all adjustments (consisting only of
normal recurring adjustments) necessary to present fairly its financial
position as of June 28, 1997, the results of its operations for the
quarters and six months ended June 28, 1997 and June 29, 1996 and changes
in its cash flows for the quarters and six months ended June 28, 1997 and
June 29, 1996. The December 31, 1996 consolidated condensed balance sheet
has been derived from the Company's audited financial statements at that
date. These interim financial statements should be read in conjunction
with the financial statements included in the Company's Annual Report on
Form 10-K for the year ended December 31, 1996.
The results of operations for the quarters and six months ended June 28,
1997 and June 29, 1996 are not necessarily indicative of the results to be
expected for the full year.
2. Discontinued operations: On March 31, 1997 the Company effected the
previously announced distribution of 5,400,000 shares of common stock of
its former subsidiary, TransAct Technologies Incorporated ("TransAct") to
Tridex stockholders on the basis of 1.005 shares of TransAct common stock
for each share of Tridex common stock owned. Since the distribution,
Tridex and TransAct have been separate publicly traded companies. On April
17, 1997 Tridex announced that it had entered into a letter of intent to
sell its wholly-owned subsidiary Cash Bases GB Limited ("Cash Bases") to a
group comprised of the executive directors of Cash Bases and Lloyds
Development Capital Limited for up to $6,200,000, consisting of
$5,200,000 in cash, a $250,000 unsecured promissory note bearing interest
at the rate of 10% per annum payable in full on April 30, 2000, contingent
payments of up to $750,000 depending upon Cash Bases' earnings before
interest and taxes for the fiscal years ending December 31, 1998 and
December 31, 1999, and a 10% equity stake in the newly organized buyer.
The sale of Cash Bases was completed on May 29, 1997. The Consolidated
Financial Statements have been restated to present the results of
operations of TransAct and Cash Bases as discontinued operations.
3. Primary earnings per common share is based on the weighted average number
of shares outstanding during the period after consideration of the
dilutive effect of stock options and warrants. In February of 1997, the
Financial Accounting Standards Board issued Statement of Financial
Accounting Standard No. 128, "Earnings Per Share." The Company will adopt
this standard, as required, at the end of this year. Had this standard
been adopted at the beginning of 1997, for the quarter ended June 28, 1997
the Company would have reported basic earnings per share from continuing
operations of zero and basic loss per share from discontinued operations
of $0.04.
4. Inventories: Components of inventory are:
June 28, 1997 December 31, 1996
------------- -----------------
(Dollars in Thousands)
Raw materials and component parts $ 1,512 $ 1,144
Work-in-process 53 46
Finished goods 2,214 3,068
--------- --------
$ 3,779 $ 4,258
========= ========
5. Other income, net: Other non-operating expense for the current quarter
consists of $6,000 equity loss from Tridex's remaining 10% equity interest
in Cash Bases Group Limited. Other non-operating expenses in the prior
year's quarter include a $30,000 provision for the estimated loss on
disposal of unused real estate and $14,000 of equity income from Tridex's
remaining 10% equity interest in Cash Bases.
6. Commitments and contingencies: The Company is involved in an environmental
matter discussed in Note 9 to the consolidated financial statements
included in the Company's Annual Report on Form 10-K for the year ended
December 31, 1996. As of June 28, 1997 and to the date of this report,
there has been no material development in the resolution of this matter.
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE RESULTS OF OPERATIONS AND
FINANCIAL CONDITION
Certain statements included in this report, including, but not limited to,
statements in this Management's Discussion and Analysis of the Results of
Operations and Financial Condition, which are not historical facts may be deemed
to contain forward looking statements with respect to events the occurrence of
which involves risks and uncertainties, including, but not limited to, the
Company's expectations regarding net sales, gross profit, operating income and
financial condition.
Results of Operations
As described in Note 2 of the Notes to Consolidated Financial Statements, on
March 31, 1997 the Company distributed all of its 5,400,000 shares of common
stock of TransAct pro rata to the holders of record of the Company's common
stock on March 14, 1997. On May 29, 1997 the Company completed the sale of Cash
Bases. The Company's Consolidated Condensed Financial Statements have been
restated to present the results of operations of TransAct and Cash Bases as
discontinued operations. The Consolidated Financial Statements may not
necessarily reflect what the results of operations or the financial position of
the Company would have been if TransAct had been a separate entity during the
periods presented and Cash Bases had been sold as at the beginning of the
periods presented. The discussion and analysis set forth below is based upon
continuing operations only, consisting of the Company's wholly-owned subsidiary,
Ultimate Technology Corporation ("Ultimate") and the Tridex Ribbon Division.
Quarter Ended June 28, 1997 Compared to Quarter Ended June 29, 1996
Consolidated net sales for the quarter ended June 28, 1997 increased $1,266,000
(25.8%) to $6,174,000 from $4,908,000 in the comparable quarter of the prior
year. The increase reflects greater volume of shipments of certain of Ultimate's
point-of-sale ("POS") component products, particularly custom manufactured
keyboards and pole displays, as well as distributed products, while sales of
complete POS terminal systems decreased compared to the prior year's quarter.
Sales of ribbons increased from the prior year's quarter.
Consolidated gross profit increased $239,000 (18.9%) to $1,503,000 from
$1,264,000 in the prior year's quarter, primarily as a result of the greater
volume of shipments of POS products. Consolidated gross profit margin decreased
to 24.3% of sales from 25.8% of sales in the prior year's quarter as a result of
a change in sales mix to a higher proportion of distributed products. The gross
profit margin improved from the 21.7% margin attained in the first quarter.
Consolidated engineering, design and product development costs increased $26,000
(20.0%) to $156,000 from $130,000 in the prior year's quarter. The increase is
primarily the result of the cost of developing new POS terminal products and, to
a lesser degree, enhancing existing products.
Consolidated selling, administrative and general expenses increased $405,000
(37.5%) to $1,484,000 from $1,079,000 in the prior year's quarter. The increase
in selling expenses is primarily the result of more intensive efforts in the
selling of POS terminal systems, including increased advertising and sales
support personnel. Administrative and general expenses include a current period
non-cash expense of $195,000 related to a stock incentive compensation agreement
with the principal executive officers of Ultimate. Administrative and general
expenses in the prior year's quarter reflects the allocation from Tridex to
TransAct of $340,000 of corporate administrative expenses.
Consolidated operating income (loss) for the current quarter was a loss of
$137,000 compared to income of $55,000 in the prior year's quarter. The loss in
the current period was primarily the result of the increase in selling,
administrative and general expenses, particularly the expense of the stock
incentive compensation agreement discussed above. Consolidated operating income
(loss) as a percentage of sales was a 2.2% loss compared to 1.1% gain in the
prior year's quarter.
Net interest income for the quarter was $156,000 compared to net interest
expense of $282,000 in the prior year's quarter. Interest income for the quarter
primarily consists of interest earned on temporary cash investments and interest
earned on receivables from the sale of stock. The Company had no debt
outstanding during the quarter.
<PAGE>
Other non-operating expense of $6,000 represents the Company's 10% share of the
losses of Cash Bases. Other non-operating expenses in the prior year's quarter
includes a $30,000 provision for the estimated loss on disposal of unused real
estate and $14,000 of equity income in the results of Cash Bases.
Provision for income taxes in the current quarter reflects an estimated
effective tax rate of 100% for the quarter. The Company expects the estimated
effective tax rate to remain at approximately 100% for the remainder of 1997 as
a result of nondeductible goodwill amortization.
Income (loss) from continuing operations for the quarter was zero, compared to a
loss of $168,000 (or $0.04 per share) in the prior year's quarter. Discontinued
operations reflect a loss of $199,000 on the sale of Cash Bases and $7,000 loss
from the operations of Cash Bases prior to the May 29, 1997 sale. Discontinued
operations in the prior year's quarter reflect $868,000 earnings from TransAct
and $107,000 earnings from Cash Bases.
Net loss for the current quarter was $206,000 (or $0.04 per share), all of which
is attributable to discontinued operations, as compared to net income $807,000
(or $0.20 per share) in the prior year's quarter, which was comprised of $0.24
per share from discontinued operations and a loss of $0.04 per share from
continuing operations. The average number of common and common equivalent shares
outstanding increased to 5,385,000 shares from 4,082,000 shares in the prior
year's quarter.
Six Months Ended June 28, 1997 Compared to Six Months Ended June 29, 1996
Consolidated net sales for the six months ended June 28, 1997 increased
$2,659,000 (29.3%) to $11,720,000 from $9,061,000 in the comparable period of
the prior year. The increase reflects greater volume of shipments of certain of
POS component products, particularly custom manufactured keyboards and pole
displays, as well as distributed products, while sales of complete POS terminal
systems decreased compared to the prior year's period. Sales of ribbons
increased from the prior year's period.
Consolidated gross profit increased $191,000 (7.6%) to $2,709,000 from
$2,518,000 in the prior year's period, primarily as a result of the greater
volume of shipments of POS products. Consolidated gross profit margin decreased
to 23.1% of sales from 27.8% of sales in the prior year's period as a result of
a change in sales mix to a higher proportion of distributed products. The
current year sales contain a lower proportion of manufactured products,
particularly custom keyboards and pole displays, versus distributed products as
compared to the prior year's period.
Consolidated engineering, design and product development costs increased $38,000
(13.7%) to $316,000 from $278,000 in the prior year's period. The increase is
primarily the result of the cost of developing new POS terminal products and, to
a lesser degree, enhancing existing products.
Consolidated selling, administrative and general expenses increased $936,000
(43.5%) to $3,089,000 from $2,153,000 in the prior year's period. The increase
in selling expenses is primarily the result of more intensive efforts in the
selling of POS terminal systems, including increased advertising and sales
support personnel. Administrative and general expenses include a current period
non-cash expense of $599,000 related to a stock incentive compensation agreement
with the principal executive officers of Ultimate.
Consolidated operating income (loss) for the current quarter was a loss of
$696,000 compared to income of $87,000 in the prior year's period. The loss in
the current period was primarily the result of the increase in selling,
administrative and general expenses, particularly the expense of the stock
incentive compensation agreement discussed above. Consolidated operating income
(loss) as a percentage of sales was a 5.9% loss compared to 1.0% gain in the
prior year's period.
Net interest income for the six month period was $165,000 compared to net
interest expense of $575,000 in the prior year's period. Interest income for the
six month period primarily consists of interest earned on temporary cash
investments and interest earned on receivables from the sale of stock. The
Company had no debt outstanding at the end of the period.
Other non-operating expense of $8,000 for the six month period represents the
Company's 10% share of the losses of Cash Bases. Other non-operating expenses in
the prior year's period include a $30,000 provision for the estimated loss on
disposal of unused real estate and $31,000 of equity income in the results of
Cash Bases.
<PAGE>
Provision for income taxes in the first six months reflects an estimated
effective tax rate. The Company expects the estimated effective tax rate to be
approximately 100% for the remainder of 1997 as a result of nondeductible
goodwill amortization.
Loss from continuing operations was $175,000 (or $0.03 per share) compared to a
loss of $377,000 (or $0.09 per share) in the prior year's period. Discontinued
operations reflect a loss of $199,000 on the sale of Cash Bases, a $67,000 loss
from the operations of Cash Bases prior to the May 29, 1997 sale and $873,000
earnings from TransAct. Discontinued operations in the prior year's period
reflect $1,733,000 earnings from TransAct and $247,000 earnings from Cash Bases.
Net income for the current period was $432,000 (or $0.08 per share), which
includes income from discontinued operations of $607,000 (or $0.11 per share) as
compared to $1,603,000 (or $0.40 per share) in the prior year's period, which
includes income from discontinued operations of $1,980,000 (or $0.49 per share).
The average number of common and common equivalent shares outstanding increased
to 5,111,000 shares from 4,010,000 shares in the prior year's period.
Liquidity and Capital Resources
The Company's working capital at June 28, 1997 was $18,238,000 compared with
$2,063,000 at December 31, 1996. The current ratio was 6.0 : 1.0 at June 28,
1997 and 1.3 : 1.0 at December 31, 1996. The increase in working capital
reflects (a) the receipt of cash upon the exercise of options and warrants for
the purchase of common stock, (b) the receipt of $1,000,000 principal payment
from TransAct, (c) the receipt of $5,200,000 cash portion of the sales price of
Cash Bases and (d) the decrease in the current portion of long term debt
resulting from the conversion of notes and debentures into common stock.
The Company has a $2,000,000 Working Capital Facility (the "Working Capital
Facility") with Fleet National Bank ("Fleet"). Under this facility, the Company
is required to comply with certain financial covenants, including a minimum
tangible net worth, a maximum leverage ratio, a minimum interest coverage ratio
and a minimum current ratio, otherwise Fleet may withdraw its commitment. The
Company was in compliance with these covenants at June 28, 1997 and expects to
be in compliance with these covenants for the remainder of 1997.
During the first half of 1997, the Company's operating cash needs were satisfied
by cash received upon the exercise of stock options and warrants, cash received
from TransAct in payment of a $1,000,000 note and cash received upon the sale of
Cash Bases of $5,200,000. At June 28, 1997, the Company had availability of
$2,000,000 under the Working Capital Facility and no material commitment for
capital expenditures.
During the remainder of 1997, the Company expects that funds generated from
operations, supplemented by existing cash balances, if necessary, will be
sufficient to satisfy its needs for working capital and capital expenditures,
primarily tooling for new products. Over the long term, the Company believes
that funds generated from operations and the use of existing cash balances, if
necessary, will continue to satisfy its working capital needs and support a
certain level of growth.
<PAGE>
PART II. OTHER INFORMATION
Item 4. Submission of Matter to a Vote of Security Holders
The Company held its Annual Meeting of Shareholders on May 14, 1997.
Matters voted upon at the meeting and the number of votes cast for,
against or withheld, are as follows:
(1) To consider and act upon a proposal to elect the following nominees
to be Directors:
Nominee Votes For Votes Against or Withheld
------- --------- -------------------------
Seth M. Lukash 4,565,283 155,220
Paul J. Dunphy 4,565,882 154,621
Graham Y. Tanaka 4,566,082 154,421
Thomas R. Schwarz 4,566,082 154,421
Dennis J. Lewis 4,566,082 154,421
(2) To approve the establishment of the 1997 Long Term Incentive Plan
for employees, officers and directors of the Corporation. Votes cast
were: 2,636,166 for, 173,189 against and 16,125 withheld.
(3) To approve the establishment of the Non-employee Stock Plan. Votes
cast were: 2,538,120 for, 227,772 against and 15,542 withheld.
(4) To appoint Price Waterhouse LLP as the Company's independent
certified public accountants for the year ended December 31, 1997.
Votes cast were: 4,700,552 for, 16,340 against and 3,610 withheld.
Item 6. Exhibits and Reports on Form 8-K
a. Exhibits
Exhibit 11. Computation of Per Share Earnings
b. Reports on Form 8-K
The Company filed a Current Report on Form 8-K on June 13, 1997 to
report that on May 29, 1997 it completed the sale of Cash Bases.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934 the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
TRIDEX CORPORATION
------------------
(Registrant)
August 8, 1997 /s/ Seth M. Lukash
-----------------------------------------
Seth M. Lukash
Chairman of the Board, President, Chief
Executive Officer, and Chief Operating
Officer
August 8, 1997 /s/ George T. Crandall
-----------------------------------------
George T. Crandall
Vice President and Treasurer
TRIDEX CORPORATION AND SUBSIDIARIES
Exhibit 11 Computation of Per Share Earnings
(Dollars in Thousands)
(Unaudited)
<TABLE>
<CAPTION>
Quarters Ended Six Months Ended
------------------------- -------------------------
June 28, June 29, June 28, June 29,
1997 1996 1997 1996
------------------------- -------------------------
<S> <C> <C> <C> <C>
PRIMARY:
EARNINGS:
Loss from continuing operations $ (168) $ (175) $ (377)
Income (loss) from discontinued operations $ (206) 975 607 1,980
------------------------- -------------------------
Net income (loss) $ (206) $ 807 $ 432 $ 1,603
========================= =========================
SHARES:
Average common shares outstanding 5,369,000 3,842,000 4,956,000 3,823,000
Dilutive effect of outstanding options and warrants as
determined by the treasury stock method 16,000 240,000 155,000 187,000
------------------------- -------------------------
5,385,000 4,082,000 5,111,000 4,010,000
========================= =========================
EARNINGS PER COMMON AND COMMON
EQUIVALENT SHARE:
Loss from continuing operations $ (0.04) $ (0.03) $ (0.09)
Income (loss) from discontinued operations $ (0.04) 0.24 0.11 0.49
------------------------- -------------------------
Net income (loss) $ (0.04) $ 0.20 $ 0.08 $ 0.40
========================= =========================
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> MAR-30-1997
<PERIOD-END> JUN-28-1997
<CASH> 14,100
<SECURITIES> 0
<RECEIVABLES> 3,758
<ALLOWANCES> 0
<INVENTORY> 3,779
<CURRENT-ASSETS> 21,896
<PP&E> 2,109
<DEPRECIATION> 1,008
<TOTAL-ASSETS> 27,462
<CURRENT-LIABILITIES> 3,658
<BONDS> 0
0
0
<COMMON> 1,377
<OTHER-SE> 22,427
<TOTAL-LIABILITY-AND-EQUITY> 27,462
<SALES> 11,720
<TOTAL-REVENUES> 11,720
<CGS> 9,011
<TOTAL-COSTS> 12,380
<OTHER-EXPENSES> (227)
<LOSS-PROVISION> 36
<INTEREST-EXPENSE> 70
<INCOME-PRETAX> (539)
<INCOME-TAX> (364)
<INCOME-CONTINUING> (175)
<DISCONTINUED> 607
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 432
<EPS-PRIMARY> .08
<EPS-DILUTED> .08
</TABLE>
