SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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 Number 0-12081
AQUILA BIOPHARMACEUTICALS, INC.
(Exact Name of Registrant as Specified in Its Charter)
Delaware 04-3307818
(State or other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
175 Crossing Boulevard, Framingham, MA 01702
(Address of Principal Executive Offices) (Zip Code)
(508)628-0100
(Registrant's Telephone Number, Including Area Code)
-----------------------------------------------------------------
365 Plantation Street, Worcester, MA 01605
(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 PROCEEDINGS 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 _X__ 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.
As of November 6, 1998
Common Stock Outstanding 6,990,386
AQUILA BIOPHARMACEUTICALS, INC.
Form 10-Q, September 30, 1998
INDEX
PART I - FINANCIAL INFORMATION
Item 1. Unaudited Financial Statements Page Number
Consolidated Balance Sheets as of September 30, 1998
and December 31,1997........................................2
Consolidated Statements of Operations for three and
nine month periods ended September 30, 1998 and 1997........3
Consolidated Statements of Comprehensive Income for the three
and nine month periods ended September 30, 1998 and 1997....4
Consolidated Statements of Cash Flows for nine month
periods ended September 30, 1998 and 1997...................5
Notes to Interim Financial Statements.......................6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
Item 6. Exhibits and Reports on Form 8-K
SIGNATURES
Item 1 - Financial Statements
Aquila Biopharmaceuticals, Inc.
Consolidated Balance Sheet
(unaudited)
(in thousands)
Assets 9/30/98 12/31/97
Current Assets:
Cash and cash equivalents $ 5,233 $ 7,352
Marketable securities 8,874 8,552
Receivables (less allowance
for doubtful accounts) 1,032 1,625
Inventories 601 679
Prepaid expenses & other current assets 222 238
Total current assets 15,962 18,446
Marketable securities 3,523 993
Investments 320 395
Property, Plant, and Equipment, Net 2,998 614
Patents and Purchased Technology, Net 135 199
Other Assets 892 21
Total Assets $ 23,830 $ 20,668
Liabilities & Shareholders' Equity
Current Liabilities:
Accounts payable $ 325 $ 290
Accrued royalties 134 150
Accrued professional fees 172 177
Other accrued expenses 1,771 1,731
Deferred revenue - current 750 -
Current maturities of long-term debt 1,798 69
Total Current Liabilities 4,950 2,417
Deferred Revenue 225 225
Long Term Debt 2,042 139
Total Liabilities 7,217 2,781
Shareholders' Equity:
Preferred stock, authorized:
5,000,000 shares, none issued 0 0
Common stock, par value: $.01 per
share, authorized: 30,500,000
shares, issued: 6,992,483 at September 30,1998
and 5,007,527 at December 31, 1997 70 50
Treasury Stock (34) (47)
Additional paid in capital 139,811 127,558
Unrealized gains on available
for sale securities 75 -
Accumulated Deficit (123,309) (109,674)
Total Shareholders' Equity 16,613 17,887
Total Liabilities and Shareholders' Equity $ 23,830 $ 20,668
The accompanying notes are an integral part of these unaudited statements.
Aquila Biopharmaceuticals, Inc.
Consolidated Statement of Operations
(unaudited)
(in thousands, except per share amounts)
Three Months Ended Nine Months Ended
September 30, September 30,
1998 1997 1998 1997
Revenue:
Product sales $ 207 $ 347 $ 763 $1,050
Research and development 953 1,863 3,188 4,331
1,160 2,210 3,951 5,381
Cost and expenses:
Cost of sales 207 267 671 785
Research and development 1,666 1,333 5,418 3,823
Purchased incomplete technology - - 9,927 -
General & administrative 833 1,278 2,900 3,600
Total costs and expenses 2,706 2,878 18,916 8,208
Other income, net 275 547 1,330 1,534
Loss from continuing operations (1,271) ( 121) (13,635) (1,293)
Discontinued operations:
Gain on disposal 0 0 0 191
Net Loss $(1,271) $( 121) $(13,635) $(1,102)
Basic and diluted loss
per weighted average share:
Loss from continuing operations $ ( 0.18) $(0.02) $(2.12) $(0.26)
Income from discontinued
operations 0.00 0.00 0.00 0.04
Net loss $ (0.18) $(0.02) $(2.12) $(0.22)
Weighted average number of
common shares outstanding:
Basic and diluted 6,992 5,004 6,443 5,002
The accompanying notes are an integral part of these unaudited statements.
Aquila Biopharmaceuticals, Inc.
Consolidated Statement of Comprehensive Income
(unaudited)
(in thousands)
Three Months Ended Nine Months Ended
September 30, September 30,
1998 1997 1998 1997
Net loss $(1,271) $ (121) $(13,635) $(1,102)
Other comprehensive income, net of tax:
Unrealized holding gains arising
during the period 75 - 75 -
______
Total other comprehensive income 75 - 75 -
______
Comprehensive loss $(1,196) $( 121) $(13,560) $(1,102)
The accompanying notes are an integral part of these unaudited statements.
4
Aquila Biopharmaceuticals, Inc.
Consolidated Statement of Cash Flows
(unaudited),(in thousands)
For the nine months
ended September 30,
1998 1997
Cash Flows From Operating Activities:
Net Loss $(13,635) $(1,102)
Adjustments to reconcile Net Loss
to net cash (used) by operating activities:
Depreciation and amortization 188 341
Provision for doubtful accounts 40 25
Stock and debt issued for incomplete technology 9,638 -
Changes in assets and liabilities:
Receivables 553 1067
Inventories 78 (126)
Deferred revenue 750 (1)
Prepaid expenses and other current assets 16 572
Accounts payable and other accrued expenses 67 (1,550)
Net cash used by
operating activities (2,305) (774)
Cash Flows From Investing Activities:
Purchases of marketable securities (18,732) (9,151)
Proceeds from maturities
of marketable securities 16,030 5,559
Other noncurrent assets and liabilities (781) (34)
Purchases of property, plant, and equipment (2,508) (145)
Net cash used by investing activities (5,991) (3,771)
Cash Flows From Financing Activities:
Payment of long-term obligations (252) (104)
Proceeds from long-term debt 2,584 -
Issuance of common stock 3,845 18
Net cash provided/(used)
by financing activities 6,177 (86)
Net decrease in cash and cash equivalents (2,119) (4,631)
Cash and cash equivalents at the beginning
of the year 7,352 9,112
Cash and cash equivalents at the end
of the period $5,233 $4,481
Supplemental disclosures:
Issuance of warrants in conjunction with debt $90 -
Issuance of treasury stock for settlement
of accrued expenses $13 -
Interest paid $13 $313
The accompanying notes are an integral part of these unaudited statements.
AQUILA BIOPHARMACEUTICALS, INC.
NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS
1. Basis of Presentation:
The accompanying interim financial statements are unaudited and have been
prepared on a basis substantially consistent with the audited financial
statements. Certain information and footnote disclosures normally included in
the Company's annual financial statements have been condensed or omitted
pursuant to the Securities and Exchange Commission's rules and regulations.
The interim financial statements, in the opinion of management, reflect all
adjustments (including normal recurring accruals) necessary for a fair
presentation of the results for the interim periods. Certain items have been
reclassified to conform to the current period's presentation.
The results of operations for the interim periods are not necessarily
indicative of the results of operations to be expected for the fiscal year.
These interim financial statements should be read in conjunction with the
audited financial statements for the year ended December 31, 1997, which are
contained in the Company's Annual Report on Form 10-K for the year ended
December 31, 1997, filed with the Securities and Exchange Commission.
The year-end balance sheet data was derived from audited financial statements,
but does not include all disclosures required by generally accepted accounting
principles.
2. Inventories:
Inventories consist of the following: (000'S)
9/30/98 12/31/97
------- --------
Finished goods $ 394 $ 478
Work in process 125 127
Raw materials & supplies 82 74
$ 601 $ 679
3. Marketable securities:
During the quarter ended September 30, 1998, the Company reclassified 15,000
shares of newly registered common stock from investments to Marketable
Securities. These shares were carried at a cost of $75,000 and as of
September 30, 1998 have a market value of $150,000 and are available for sale.
4. Earnings Per Share:
The common stock equivalents of the Company consisted of stock options and
warrants. The Company was in a net loss at September 30, 1998 and September
30, 1997, therefore, common stock equivalents were not used to compute diluted
loss per share since the effect would be antidilutive. Options and warrants
to purchase 851,523 and 875,280 shares of common stock were outstanding at
September 30, 1998 and 1997, respectively.
6
5. Acquisition of VacTex, Inc.
In connection with the acquisition of VacTex, Inc. ("VacTex"), the Company
issued 1,150,000 shares of common stock and $1.3 million in notes payable for
all the outstanding shares of VacTex. The notes payable carry interest at 7%
and are due April 14, 1999. The acquisition has been accounted for using the
purchase method. Due to the early stage of the technology purchased and the
expected efforts to develop the technology, the entire purchase of $9.9
million, which included stock, notes payable and assumed liabilities was
charged to purchased incomplete technology in the second quarter of 1998.
6. Transamerica Loan
During July 1998 the Company entered into a loan agreement (the "Agreement")
with Transamerica Business Credit Corporation. The Agreement made available
$5.0 million in credit for the build-out of the new facility in Framingham,
Massachusetts and for the purchase of new equipment. The Agreement calls for
interest at 13 percent with a repayment term of four years and a 10 percent
balloon payment at the end of the loan term. Warrants to purchase 60,680
shares of the Company's common stock were issued in connection with the loan
agreement. The warrants have an exercise price of $4.12 and a term ending
July 1, 2003. The warrants were valued at $90,000 and will be amortized over
the life of the loan. As of September 30, 1998, the Company had borrowed $2.6
million under this Agreement.
7. Contingencies:
The Company has been named a potentially responsible party ("PRP") by the
Environmental Protection Agency ("EPA") at a waste disposal site. The EPA
will generally impose joint and several liability upon each PRP at each site.
The extent of the Company's required financial contribution to the cleanup of
this site is expected to be limited based on the number and financial strength
of the other named PRPs and the volume and types of waste involved which might
be attributable to the Company.
8. Subsequent Events:
CSL International ACN ("CSL") and Seed Capital Inc., filed an opposition with
the European Patent Office ("EPO") on the issuance of the Company's StimulonTM
Patent in Europe. A hearing before the EPO was held in October of 1998. The
Company prevailed against all points raised in the opposition. CSL may appeal
the EPO's decision and though the Company does not believe that CSL's claims
have any merit or are likely to succeed, there can be no assurance that the
Company will prevail in any future actions taken to attack the validity of its
StimulonTM patents.
Deloitte & Touche, LLP ("Deloitte") appealed the United States Bankruptcy
Court's July 18, 1996 order confirming the Plan of Reorganization ("the Plan")
of Cambridge Biotech Corporation ("CBC"), the Company's predecessor. The
United States District Court for the District of Massachusetts ("the District
Court") granted the motion of the Company (which was substituted for CBC as
appellee in the appeal) to dismiss this appeal on the grounds that, among
other things, the Plan had been consummated. Deloitte brought a further
appeal to the U.S. Court of appeals (First Circuit) for the District Court's
dismissal order. In September 1998, the U.S. Court of Appeals granted a
motion to dismiss the appeal brought by Deloitte which was assented to by the
Company.
7
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Three months ended September 30, 1998 compared to three months ended September
30, 1997:
Revenue
Total revenues were $1.2 million for the three months ended September 30, 1998
compared to $2.2 million in the same period in 1997, a decrease of 48%.
Third quarter 1998 product sales were $0.2 million, compared to $0.3 million
the same period one year ago. The difference was the result of the reduction
of inventories at distributors and the acquisition of a reseller by a
competitor. Future product revenues are expected to remain at the third
quarter level or be lower unless the reseller can be replaced. Research and
development revenues decreased by 49% from one year ago. The decrease was due
to lower shipments of clinical trial material, which tend to fluctuate; lower
license fees due to a large payment in the third quarter of 1997; and lower
outside funding of the Company's animal healthcare program. This program has
evolved to the stage awaiting final licensing trials for which costs are not
shared with the Company's research partner.
Costs and Expenses
For the third quarter of 1998, Cost of products as a percentage of product
revenue was 100% and included costs incurred for the relocation in August and
September to new facilities. Third quarter research and development spending
increased by 25% from one year ago to $1.7 million. The increase was a result
of the continuation of a Phase II clinical trial, spending in preparation for
a licensing trial for an animal healthcare product, and assumption of the
research programs from VacTex, acquired in April 1998. General and
administrative expenses were reduced by 35% from one year ago due to lower
legal and professional fees and to lower facility costs.
Other Income, Net
Other income decreased by 50% from one year ago primarily due to the absence
of rental income from real estate sold in November of 1997 and due to
decreased royalty income.
9
Nine months ended September 30, 1998 compared to nine months ended September
30, 1997:
Revenue
Total revenues were $4.0 million for the nine months ended September 30, 1998
compared to $5.4 million in the same period in 1997, a decrease of 27%.
Product sales for the first nine months of 1998 were $0.8 million, compared to
$1.1 million for the same period one year ago. The difference in product
sales occurred in the second and third quarters of 1998 due to the reduction
of inventories at distributors and the acquisition of a reseller by a
competitor.
Research and development revenue for the first nine months of 1998 was $3.2
million, compared to $4.3 million for the first nine months of 1997. The
difference was primarily due to fluctuating shipments of clinical trial
material, a large license fee payment in the same period of 1997, and
evolution of the animal healthcare program to the stage where some costs are
not shared with the Company's partner.
Costs and Expenses
For the nine months ended September 30, 1998, cost of products as a percentage
of product revenue was 88% compared to 75% for the nine month period in 1997
and included costs incurred for the relocation in August and September to new
facilities.
In April 1998, the Company acquired VacTex, Inc., ("VacTex"). VacTex
consisted primarily of technology and associated intellectual property. Due
to the early stage of the technology and the need to expend additional
resources to develop the technology, the purchase price of $9.9 million was
charged to incomplete technology in the second quarter. The Company expects
to spend up to $0.3 million in outside collaborations and to allocate up to
$0.6 million of current resources during the next six months to develop the
VacTex technology. The development program is expected to be a long term
endeavor for the Company that will be evaluated periodically to determine
future spending levels. Total research and development expense for the first
nine months of 1998 was $5.4 million, compared to $3.8 million for the first
nine months of 1997. The increase occurred in the second and third quarters
due to clinical and licensing trial expenses, milestone expense for patent
issuance, and spending on the research programs acquired from VacTex. General
and administrative expenses were $2.9 million, a reduction of 19% from the
same period one year ago primarily due to lower legal and professional fees
and to reduced facilities costs.
Other Income, Net
Other income decreased by 13% from one year ago primarily due to reduced
royalty income and to reduced rental income from real estate sold in November
of 1997.
Liquidity, Capital Resources and Business Outlook
Total cash, cash equivalents and marketable securities were $17.6 million at
September 30, 1998 compared to $16.9 million at December 31, 1997.
During the first nine months of 1998, operating used cash of $2.3 million
consisting of the net loss of $13.6 million partially offset by non-cash
charges of $9.8 million and cash provided from improved utilization of current
assets and liabilities of $1.5 million.
Investing activities used cash of $6.0 million during the first nine months of
1998 primarily due to the net purchase of marketable securities. Other
investing activities included securities held as collateral and fit-out of the
new facility in Framingham, Massachusetts. An additional investment of
approximately $2.4 million to complete the new facility fit-out will be
required in the fourth quarter of 1998. The fit-out will be funded by
borrowing under the Transamerica agreement.
Financing activities provided cash of $6.2 million during the first nine
months of 1998. The cash provided in 1998 came from the sale of the Company's
common stock in a private placement in the first quarter of 1998, from option
exercises and from a loan agreement ("the Agreement") with Transamerica
Business Credit Corporation. The Agreement makes available $5.0 million in
credit for the fit-out of the new facility in Framingham, Massachusetts. The
Agreement calls for interest at 13 percent with a four year repayment term and
a 10 percent balloon payment at the end of the loan's term. Warrants to
purchase 60,680 shares of the Company's common stock were issued in connection
with the loan agreement. The warrants have an exercise price of $4.12 and a
term ending July 1, 2003. The warrants were valued at $90,000 and will be
amortized over the life of the loan. As of September 30, 1998, the Company
has borrowed $2.6 million under this Agreement. Interest expense decreased to
$0.1 million during the first nine months of 1998 as a result of the payoff of
a mortgage on real estate sold in November 1997.
Aquila expects that its available cash and marketable securities, and its cash
flows from research contracts, product sales and borrowings will be sufficient
to finance its planned operations and capital requirements for the next two
years. The Company's ability to fund its long term operations is dependent on
several factors, including the Company's ability to attract funding through
additional public and private financing or by establishing corporate
partnerships and collaborative agreements. There can be no assurance that
such additional funding can be obtained on acceptable terms.
Aquila's revenues and expenses vary from quarter to quarter and will continue
to vary in the future. Future revenues depend primarily upon the success of
Aquila's efforts to license its proprietary technology and enter into cost
sharing programs, and its ability to market its products currently undergoing
development or clinical trials. Aquila's expenses fluctuate primarily due to
clinical trials, which take from six months to two years, and require varying
degrees of financial support. Revenues or operating results in any period
will not necessarily be indicative of results in subsequent periods.
Aquila's discussions as to management's plans and objectives for Aquila's
business after the date hereof are forward looking statements that involve a
number of risks and uncertainties. Actual results may differ materially from
those projected by Aquila. The following factors, among others, could effect
the Company's actual results: general economic conditions; risks in product
and technology development; delays and difficulties in the regulatory approval
process; difficulties in obtaining raw materials and supplies for the
Company's products; failure of corporate partners to commercialize
successfully products using the Company's technology; competition from other
companies; the cost of acquiring additional technology; failure to obtain the
funding necessary for the company's planned activities; and other risks
identified in this Form 10Q and in Aquila's other Securities and Exchange
Commission filings and the exhibits thereto.
11
PART II - OTHER INFORMATION
Contingencies:
The Company has been named a potentially responsible party ("PRP") by the
Environmental Protection Agency ("EPA") at a waste disposal site. The EPA
will generally impose joint and several liability upon each PRP at each site.
The extent of the Company's required financial contribution to the cleanup of
this site is expected to be limited based on the number and financial strength
of the other named PRPs and the volume and types of waste involved which might
be attributable to the Company.
Year 2000:
The Year 2000 ("Y2K") issue originates in computer programs that characterize
the year with two digits instead of four. This method of characterization may
result in interpretation of the year 2000 in a manner that would cause
inadequate or inaccurate results. The Company is engaged in basic research
and product development, and in manufacturing a product for animal healthcare
and material for its research partners. The Company believes that with the
relocation to newly constructed facilities in September 1998 and the
conversion to Y2K compliant business systems software in the first quarter of
1998, the Y2K problem will not pose significant internal operational problems
for the Company. The Company has conducted an internal review of equipment and
software employed in its business, manufacturing and research operations and
concluded that there are no Y2K systemic dependencies. Specific items of
equipment and associated software found to be date dependent are expected be
replaced prior to the year 2000 due to capacity or quality improvements. In
the normal course of its business, the Company conducts audits of key vendors
and vendors used for regulated products to assure their ability to supply
materials. These audits have not revealed any Y2K compliance issues with
respect to the Company's key vendors. The Company's marketing partner is a
French company and there can be no assurance that this company will be Y2K
compliant. The Company has material transfer agreements with a number of other
companies and there can be no assurance that these companies will be Y2K
compliant. Total amounts expended to date in direct connection to the Y2K
issue were for new business software and hardware and were less than $100,000.
Future costs are expected to be less than $50,000. Y2K issues could adversely
affect both revenues and costs if the Company were unable to supply material
and products to customers and research partners. In insure no interruption in
supply during the two quarters immediately proceeding and following the year
2000, the Company may consider carrying higher inventories of raw material
from vendors used for regulated products and higher finished goods inventories
to supply the needs of customers and partners.
Subsequent Events:
CSL International ACN ("CSL") and Seed Capital Inc., filed an opposition with
the European Patent Office ("EPO") on the issuance of the Company's StimulonTM
Patent in Europe. A hearing before the EPO was held in October of 1998. The
Company prevailed against all points raised in the opposition. CSL may appeal
the EPO's decision and though the Company does not believe that CSL's claims
have any merit or are likely to succeed, there can be no assurance that the
Company will prevail in any future actions taken to attack the validity of its
StimulonTM patents.
Deloitte & Touche, LLP ("Deloitte") appealed the United States Bankruptcy
Court's July 18, 1996 order confirming the Plan of Reorganization ("the Plan")
of Cambridge Biotech Corporation ("CBC"), the Company's predecessor. The
United States District Court for the District of Massachusetts ("the District
Court") granted the motion of the Company (which was substituted for CBC as
appellee in the appeal) to dismiss this appeal on the grounds that, among
other things, the Plan had been consummated. Deloitte brought a further
appeal to the U.S. Court of appeals (First Circuit) for the District Court's
dismissal order. In September 1998, the U.S. Court of Appeals granted a
motion to dismiss the appeal brought by Deloitte which was assented to by the
Company.
Item 6. Exhibits and Reports of Form 8-K
Exhibits
27. Financial Data Schedule
Reports on Form 8-K
1. Form 8-K/A dated September 23, 1998.
-----------------------------------------------------------------
14
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the duly caused this report to be signed on its behalf by
undersigned thereunto duly authorized.
AQUILA BIOPHARMACEUTICALS, INC.
Date: November 10, 1998 /s/ Alison Taunton-Rigby
_____________________________
Alison Taunton-Rigby
President and Chief Executive Officer
/s/ James L. Warren
_____________________________
James L. Warren
Vice President Finance,
Chief Financial Officer and Treasurer
15
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
unaudited financial statements of the Company for the period ended September 31,
1998 and is qualified in its entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> SEP-30-1998
<CASH> 5,233
<SECURITIES> 8,874
<RECEIVABLES> 1,079
<ALLOWANCES> 47
<INVENTORY> 601
<CURRENT-ASSETS> 15,962
<PP&E> 8,076
<DEPRECIATION> 5,078
<TOTAL-ASSETS> 23,830
<CURRENT-LIABILITIES> 4,950
<BONDS> 2,042
0
0
<COMMON> 70
<OTHER-SE> 16,543
<TOTAL-LIABILITY-AND-EQUITY> 23,830
<SALES> 763
<TOTAL-REVENUES> 3,951
<CGS> 671
<TOTAL-COSTS> 16,016
<OTHER-EXPENSES> 2,900
<LOSS-PROVISION> 40
<INTEREST-EXPENSE> 51
<INCOME-PRETAX> (13,635)
<INCOME-TAX> 0
<INCOME-CONTINUING> (13,635)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (13,635)
<EPS-PRIMARY> (2.12)
<EPS-DILUTED> (2.12)
</TABLE>
