UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
(Mark One)
[ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended May 31, 1999
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE
ACT
For the transition period from ____________ to _______________
Commission file number 0-12551
CREATIVE COMPUTER APPLICATIONS, INC.
(Exact name of small business issuer as specified in its charter)
California 95-3353465
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
26115-A Mureau Road, Calabasas, California 91302
(Address of principal executive offices)
(818) 880-6700
Issuer's telephone number:
Check whether the Issuer (1) filed all reports required to
be filed by Section 13 or 15(d) of the Exchange Act 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 classes of common equity, as of the latest practicable
date: 3,085,090 common shares as of June 28, 1999.
Transitional Small Business Disclosure Format (check one):
Yes No X
CREATIVE COMPUTER APPLICATIONS, INC.
FORM 10-QSB
I N D E X
PART I - Financial Information: PAGE
Condensed Balance Sheets at May 31, 1999
and August 31, 1998 3
Condensed Statements of Operation for the
three months ended May 31, 1999 and May 31, 1998 4
Condensed Statements of Operation for the
nine months ended May 31, 1999 and May 31, 1998 5
Condensed Statements of Cash Flows for the
nine months ended May 31, 1999 and May 31, 1998 6
Notes to Condensed Financial Statements 7
Management's Discussion and Analysis or Plan of Operation 7
PART II - Other Information:
Items 1 through 6 10
Signatures 11
CREATIVE COMPUTER APPLICATIONS, INC.
PART 1 - FINANCIAL INFORMATION
CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
May 31, August 31,
1999 1998 *
<S> <C> <C>
(Unaudited)
ASSETS
CURRENT ASSETS:
Cash $ 766,319 $ 375,876
Receivables 2,784,765 1,973,601
Inventories 586,867 670,243
Prepaid expenses and other assets 185,886 79,907
Deferred tax asset 466,300 466,300
TOTAL CURRENT ASSETS 4,790,137 3,565,927
PROPERTY AND EQUIPMENT, net 605,221 575,804
INVENTORY OF COMPONENT PARTS 125,027 156,527
CAPITALIZED SOFTWARE COSTS,
net of accumulated
amortization of
$597,566 and $384,509 1,230,759 1,128,498
INTANGIBLES, net 252,776 302,120
OTHER ASSETS 22,692 32,371
DEFERRED TAX ASSET 844,200 844,200
TOTAL ASSETS $ 7,870,812 $ 6,605,447
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes payable to bank (Note 4) $ 359,098 $ 611,609
Accounts payable 519,526 507,005
Accrued liabilities:
Vacation Pay 169,373 184,305
Other 454,480 344,081
Deferred service contract income 654,770 754,343
Deferred revenue 1,386,086 638,018
TOTAL CURRENT LIABILITIES 3,543,333 3,039,361
TOTAL LIABILITIES 3,543,333 3,039,361
SHAREHOLDERS' EQUITY:
Preferred shares, no par value;
500,000 shares authorized;
no shares outstanding - -
Common shares, no par value;
20,000,000 shares authorized;
3,076,340 and 2,920,740 shares
outstanding 5,981,067 5,831,027
Accumulated deficit (1,653,588) (2,264,941)
TOTAL SHAREHOLDERS' EQUITY 4,327,479 3,566,086
$ 7,870,812 $ 6,605,447
</TABLE>
See Notes to Financial Statements.
? As presented in the audited financial statements
CREATIVE COMPUTER APPLICATIONS, INC.
CONDENSED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Three Months Ended May 31
1999 1998
<S> <C> <C>
(unaudited)
NET SYSTEM SALES AND
SERVICE REVENUE (Note 3)
System sales $ 1,641,849 $ 827,561
Service revenues 710,774 591,175
2,352,623 1,418,736
COST OF PRODUCTS AND
SERVICES SOLD
System sales 757,257 700,662
Service revenue 392,736 399,242
1,149,993 1,099,904
Gross profit 1,202,630 318,832
OPERATING EXPENSES:
Selling, general
and administrative 729,070 612,504
Research and development 191,964 165,666
921,034 778,170
Operating income (Loss) 281,596 ( 459,338)
INTEREST AND OTHER INCOME 4,694 1,858
INTEREST EXPENSE ( 7,268) ( 17,577)
Income (Loss) before
taxes on income 279,022 ( 475,057)
TAXES ON INCOME ( 1,200) 0
NET INCOME (LOSS) $ 277,822 ($ 475,057)
EARNINGS (LOSS) PER
COMMON SHARE (Note 2):
Basic $ .09 ($ .16)
Diluted $ .08 ($ .16)
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES AND COMMON STOCK
EQUIVALENTS OUTSTANDING
Basic 2,978,448 2,912,540
Diluted 3,410,965 2,912,540
</TABLE>
See Notes to Financial Statements.
CREATIVE COMPUTER APPLICATIONS, INC.
CONDENSED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Nine Months Ended May 31
1999 1998
<S> <C> <C>
(unaudited)
NET SYSTEM SALES AND
SERVICE REVENUE (Note 3)
System sales $ 4,369,735 $ 2,793,677
Service revenues 2,090,732 1,719,558
6,460,467 4,513,235
COST OF PRODUCTS AND SERVICES SOLD
System sales 2,149,173 2,007,212
Service revenue 1,112,804 1,126,099
3,261,977 3,133,311
Gross profit 3,198,490 1,379,924
OPERATING EXPENSES:
Selling, general and administrative 2,026,691 1,853,884
Research and development 530,912 486,791
2,557,603 2,340,675
Operating income (Loss) 640,887 ( 960,751)
INTEREST AND OTHER INCOME 7,300 3,004
INTEREST EXPENSE ( 34,435) ( 37,317)
LOSS ON INVESTMENT - ( 14,151)
Income (Loss) before taxes on income 613,752 ( 1,009,215)
TAXES ON INCOME ( 2,400) 0
NET INCOME (LOSS) $ 611,352 ($ 1,009,215)
EARNINGS (LOSS) PER COMMON
SHARE (Note 2):
Basic $ .21 ($ .35)
Diluted $ .19 ($ .35)
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES AND COMMON STOCK
EQUIVALENTS OUTSTANDING
Basic 2,939,976 2,894,423
Diluted 3,152,824 2,894,423
</TABLE>
See Notes to Financial Statements.
CREATIVE COMPUTER APPLICATIONS, INC.
CONDENSED STATEMENTS OF CASH FLOWS
Increase (Decrease) in Cash
<TABLE>
<CAPTION>
Nine Months Ended May 31
1999 1998
<S> <C> <C>
(unaudited)
OPERATING ACTIVITIES:
Net income (Loss) $ 611,352 ($ 1,009,215)
Adjustments to reconcile net
income (Loss) to net cash
provided by (used in) operating
activities:
Depreciation and amortization 445,543 369,070
Provision for possible losses 63,408 22,809
Changes in operating assets and
liabilities:
Receivables ( 874,572) 133,115
Inventories 83,376 ( 55,477)
Prepaid expenses and other assets ( 97,669) ( 14,858)
Accounts payable 12,521 ( 71,797)
Accrued liabilities 743,962 576,904
Net cash provided by (used in)
operating activities 987,921 ( 49,449)
INVESTING ACTIVITIES
Additions to property and equipment ( 179,689) ( 244,064)
Additions to intangibles 0 ( 49,346)
Capitalized software costs ( 315,318) ( 298,000)
Net cash used in investing
activities ( 495,007) ( 591,410)
FINANCING ACTIVITIES:
Additions to (payments on) notes
payable, net ( 252,511) 420,533
Decrease in capital lease obligations,
net of payments 0 ( 15,122)
Exercise of Stock Options 150,040 69,167
Net cash provided by (used in)
financing activities ( 102,471) 474,578
NET INCREASE (DECREASE) IN CASH 390,443 ( 166,281)
Cash, beginning of period 375,876 534,430
Cash, end of period $ 766,319 $ 368,149
</TABLE>
See notes to financial statements.
CREATIVE COMPUTER APPLICATIONS, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
Note 1. In the opinion of management, the accompanying
unaudited condensed financial statements reflect
all adjustments (which include only normal
recurring accruals) necessary to present fairly the
Company's financial position as of May 31, 1999 and
August 31, 1998, the results of its operations for
the three months and nine months ended May 31, 1999
and 1998, and cash flows for the nine months ended
May 31, 1999 and May 31, 1998.
Note 2. The Company adopted SFAS No. 128, "Earnings Per
Share,". SFAS No. 128 requires presentation of
basic and diluted earnings per share. Basic
earnings per share is computed by dividing income
or loss available to common shareholders by the
weighted average number of common shares
outstanding for the reporting period. Diluted
earnings per share reflects the potential dilution
that could occur if securities or other contracts,
such as stock options and warrants; to issue common
stock were exercised or converted into common
stock. For the nine months ended May 31, 1998, the
Company did not include any potential diluted
shares as inclusion would be anti-dilutive.
Note 3. The Company elected early adoption of Statement of
Position 97-2, "Software Revenue Recognition",
("SOP 97-2") and initially recorded the impact of
the adoption in the Company's Statements of
Operations for the three months and six months
ended February 28, 1998. SOP 97-2 supersedes SOP
91-1 regarding software revenue recognition. SOP
97-2 required the Company to change the method of
recognizing revenue on software sales and related
services, in accordance with SOP 97-2. The SOP
requires companies to recognize revenue when (i)
persuasive evidence of an arrangement exists, (ii)
delivery has occurred, (iii) the vendor's fee is
fixed and determinable, and (iv) collectability is
probable. The SOP also requires companies to
allocate the fee on a multiple element contract
between the various elements based on vendor-
specific objective evidence of fair value.
Note 4. The Company's bank line of credit as of May 31,
1999 amounted to approximately $700,000, of that
amount $359,098 was outstanding as of that date.
The Company was in compliance with all covenants
and financial ratios required by its bank as of May
31, 1999. The Company extended its line of credit
with the bank, which is now due on February 1, 2000.
Item 2. Management's Discussion and Analysis of Results of
Operations and Financial Condition
This following section of the report contains forward-
looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements
involve risks and uncertainties so that the actual results may vary
materially.
Results of Operations
In October 1997 the American Institute of Certified Public
Accountants issued Statement of Position (SOP) 97-2, Software
Revenue Recognition, which became effective for fiscal years
beginning after December 15, 1997 although earlier adoption was
recommended. The new SOP affects all companies that sell software
and provide related services. Its provisions necessitate
significant modifications in the way the Company structures software
transactions and reports revenues from those activities. Because
SOP 97-2 significantly changes the way in which the Company accounts
for the sale of its Clinical Information Systems, management decided
to adopt the change in accounting method during the second quarter
of 1998 instead of waiting until the beginning of its next fiscal
year. The results of the accounting change had an immediate impact
on the reporting of revenues and created operating losses for the 2nd
and 3rd fiscal quarters of 1998.
SOP 97-2 requires that the Company modify its revenue
recognition policies on a going forward basis and no restatement of
prior periods is required. The change in accounting method brought
about by SOP 97-2 primarily affects reporting of revenues from the
sale of the Company's CIS products and related data acquisition
products bundled into CIS transactions. All other components of the
Company's business from which it derives revenues were already
compliant with the provisions of SOP 97-2. Under the SOP 97-2
guidelines, revenues from the sale of the Company's CIS products are
recognized as hardware and standard software are delivered to a
customer; custom software, such as interfaces to other vendors
systems, is recognized when delivered and operational, and revenues
associated with the installation and implementation of systems are
recognized as the services are performed. Other provisions of the
SOP that require, among other things, a defined contract and
definitive sales price have been met by the Company's internal sales
policies that were already in place for many years.
Sales for the third quarter of fiscal 1999 ended May 31,
1999 increased by $933,887 or 66% compared to the same quarter of
fiscal 1998. For the nine-month period ended May 31, 1999 sales
increased $1,947,232 or 43% compared to the same period in fiscal
1998. When analyzed by product category for the quarter and nine
month periods, sales of Clinical Information Systems (CIS) increased
$679,197 or 95% and $1,197,754 or 52% respectively, sales of data
acquisition products increased $135,090 or 122% and $378,304 or 81%
respectively, and service revenues increased by $119,599 or 20% and
$371,174 or 22% respectively. The increase in revenues associated
with the Company's CIS products was primarily attributable to an
increase in CIS sales in third quarter of fiscal 1999. The increase
in the sale of data acquisition products is primarily attributable
to a larger number of units shipped to OEM customers, and the
increase of CIS sales. The increase in service revenues was
attributable to a greater number of customer sites on contract. The
Company has experienced an increase in sales of its CIS products and
has won larger contracts that have contributed to the overall
increase in sales. Management believes this trend will continue in
the fourth quarter of the current fiscal year and the first quarter
of fiscal 2000.
Cost of sales for the third quarter and nine month period
ended May 31, 1999 increased by $50,089 or 5% and increased by
$128,666 or 4% respectively as compared to the same quarter and nine
month period of 1998. For the quarter and nine month period the
increase in costs of sales was primarily attributable to the
increase in material costs of $42,843 or 16% and $219,030 or 32%,
respectively, which was partially offset by a decrease in labor
costs of $23,361 or 5% and $80,648 or 6% respectively, and increases
in other costs of $30,607 or 8% and decrease of $9,716 or .01%
respectively. The overall increases in material costs were
attributable to an increase in CIS sales during the periods. For
the current quarter and nine month period ended May 31, 1999, cost
of sales as a percentage of sales decreased to 49% from 78% and
decreased to 50% from 69% respectively. These decreases were
attributable to a higher volume of CIS product sales and service
revenues. In addition, the Company booked several software only
transactions which contributed to higher gross margins.
Selling and administration expenses increased $116,566 or
about 19% and $172,807 or 9% in comparing the current quarter and
nine months ended May 31, 1999 with the same periods of fiscal 1998.
The increase was primarily attributable to planned expenditures in
sales and marketing associated with the Company's CIS products.
Management anticipates the increased level of sales and marketing
expenditures to continue in the last quarter of fiscal 1999 as the
Company expands its sales and marketing activities related to the
sale of its CIS products across a broader market spectrum.
Research and Development expense increased $26,298 or 16%
and $44,121 or 9% for the current quarter and nine months ending May
31, 1999 compared to the same periods of fiscal 1998. The increases
were primarily attributable to a greater amount of labor costs
incurred in the current periods due to a number of new software
products in development.
As a result of the aggregate factors discussed above the
Company earned net income of $277,822 or basic and diluted net
income per share of $.09 and $.08 respectively, and $611,352 or
basic and diluted net income per share of $.21 and $.19
respectively, for the current quarter and nine month period ending
May 31, 1999 compared to the net losses of $475,057 or basic and
diluted loss per share of $.16 and a net loss of $1,009,215 or basic
and diluted loss per share of $.35 in the comparable quarter and
nine month period one year ago.
Capital Resources and Liquidity
As of May 31, 1999, the Company's working capital amounted
to $1,246,804 compared to $526,566 at August 31, 1998. The ratio of
the Company's current assets to current liabilities was
approximately 1.4 to 1 at May 31, 1999 compared to 1.2 to 1 at
August 31, 1998.
The Company's Balance Sheet has been affected by the
inclusion of deferred revenues as a current liability which affects
working capital ratios, that resulted from the adoption of SOP 97-2.
The Company's bank line of credit as of May 31, 1999
amounted to approximately $700,000, of that amount $359,098 was
outstanding as of that date. The Company was in compliance with all
covenants and financial ratios required by its bank as of May 31,
1999. The Company extended its line of credit with the bank, which
is now due on February 1, 2000.
The Company believes that its cash flows from operations
together with its bank credit facilities should be sufficient to
fund its working capital requirements for its 1999 fiscal year.
Seasonality, Inflation and Industry Trends
The Company sales are generally lower in the summer and
higher in the fall and winter. Inflation has had no material effect
on the Company business since the Company has been able to adjust
the prices of its products and services. Management believes that
most phases of the healthcare segment of the computer systems
industry will continue to be competitive and that the changes taking
place in healthcare will have a long term positive impact on its
business. In addition, management believes that the industry will
experience more significant technological advances which will
improve the quality of service and reduce costs. The Company is
poised to meet these challenges by continuing to employ new
technologies when they become available, diversifying its product
offerings, and by constantly enhancing its software applications.
Year 2000 Compliance
Many currently installed computer systems and software
products are coded to accept only two digit entries in the date code
field. As the year 2000 approaches, these code fields will need to
accept four digit entries to distinguish years beginning with "19"
from those beginning with "20". As a result some computer systems
and software used by the Company and its clients may have to be
upgraded to comply with such Year 2000 requirements. The Company is
currently expending resources to review its products, systems and
services and the computer systems and software products it sells in
order to identify and modify those products, systems and services.
The Company believes that the cost of the modifications associated
with this effort will not have a material adverse effect on the
Company's operating results. However, achieving Year 2000
compliance is dependent on many factors, some of which are not
completely within the Company's control, including without
limitation, the availability and cost of trained personnel and
effectiveness of software upgrades used by the Company and its
vendors and suppliers. Should either the Company's internal systems
or the internal systems of one or more significant vendors or
suppliers fail to achieve Year 2000 compliance, the Company's
business and its results of operations could be adversely affected.
Clinical Information Systems
The Company has been engaged in evaluating and modifying its
CIS products for sometime and has completed core modifications and
testing for Year 2000 changes to CyberLAB II(Registered Trademark).
The Company has distributed the Year 2000 compliant software
upgrades to its clients. CyberRAD(Registered Trademark) and MQA
were designed to be Year 2000 compliant. CyberMED(Trademark) is
currently being modified and it is expected that the modifications
and testing will be completed by July 1999. Subsequently the
modified CyberMED(Trademark) upgrade will be distributed to clients.
Modifications were also completed to the financial management
system, and have been distributed. The Company is also evaluating
communication interfaces it has installed in order to determine in
each individual case, whether the software is Year 2000 compliant,
and will undertake such modifications as are deemed to be necessary
to be compliant. The Company believes it is timely and on schedule
in its efforts to effectuate the modifications, testing and upgrade
of its developed software applications to its clients. Management
is cognizant of the fact that the timeliness of the completion and
distribution of Year 2000 modifications are critical to the success
of the Company.
As part of the Company's Year 2000 due diligence efforts it
evaluated all of the information technology products that it resold
to its clients, that are manufactured by third party vendors. This
information and the manufacturers own Year 2000 compliance programs
have been fully disclosed to the Company's clients.
It has been determined that many of the Company's clients
require upgrades to their computers and/or operating systems, in
order to operate the upgraded application software and otherwise be
Year 2000 compliant. The Company has been conducting a review of
its client installations in order to determine their status and to
advise clients as to what modifications should be undertaken. The
Company's extended service agreements require that the client be
responsible for the cost of any upgrades to their computers that may
be required to operate upgraded or modified application software.
Therefore the Company does not expect to bear the costs associated
with this effort and instead will derive revenues from the upgrades
which it expects to complete during the next six months. The
Company has identified the modifications and/or upgrades required by
the vendors and is assisting its clients in securing the necessary
modifications and/or upgrades. As a follow up, the Company has sent
a Year 2000 technical document to all it's clients, and posted the
information on its web site to assist its clients in their
evaluations, at www.ccainc.com.
In House Systems and Computers
The Company continues to conduct a review of the computers,
systems and software that it utilizes internally to operate its
business. It was previously determined that some systems such as
its accounting and voice mail systems needed to be replaced since
they were not modifiable. However, such systems were already due to
be replaced because they are no longer adequate and are not being
supported by their manufacturers. Such replacements have been
completed as of June 18, 1999. Other systems supported by their
manufacturers will be upgraded in the normal course with Year 2000
modifications on a timely basis. Although the Company had to bear
the cost of replacing non-compliant systems, as anticipated, the
aggregate expenditures were not of a material nature. The cost of
such replacements so far is estimated at approximately $60,000.
PART II - OTHER INFORMATION
Items 1 through 5. NOT APPLICABLE.
Item 6. Exhibits and Reports on Forms 8-K
(a) Exhibit 11 - Statement re: computation of per share
earnings.
Exhibit 27 - Financial Data Schedule.
(b) There were no reports filed on Form 8-K during
the quarter ended May 31, 1999.
CREATIVE COMPUTER APPLICATIONS, INC.
SIGNATURES
In accordance with the requirements of the Exchange Act, the
Company caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
CREATIVE COMPUTER APPLICATIONS, INC.
(Company)
Date: June 30 , 1999 /S/ Steven M. Besbeck
Steven. M. Besbeck, President
Chief Executive Officer, Chief
Financial Officer
Date: June 30 , 1999 /S/ Carol Bessel
Carol Bessel
Controller and Chief Accounting
Officer
CREATIVE COMPUTER APPLICATIONS, INC.
COMPUTATION OF EARNINGS PER COMMON SHARE
Exhibit 11
<TABLE>
<CAPTION>
Nine Months Ended Three Months Ended
May 31, May 31,
<S> <C> <C> <C> <C>
1999 1998 1999 1998
AVERAGE MARKET
PRICE PER SHARE $ 1.30 $ 1.57 $ 2.10 $ 1.39
NET INCOME (LOSS) $ 611,352 ($1,009,215) $ 277,822 ($ 475,057)
Basic weighted
average number of
common shares
outstanding 2,939,976 2,894,423 2,978,448 2,912,540
Diluted effect of
stock options 212,848 - 432,517 -
Diluted weighted
average number of
common shares
outstanding 3,152,824 2,894,423 3,410,965 2,912,540
Basic earnings
(loss) per share $ .21 ($ .35) $ .09 ($ .16)
Diluted earnings
(loss) per share $ .19 ($ .35) $ .08 ($ .16)
</TABLE>
<TABLE>
<CAPTION>
[ARTICLE] 5
[RESTATED]
<S> <C>
[PERIOD-TYPE] 9-MOS
[FISCAL-YEAR-END] AUG-31-1998
[PERIOD-END] MAY-31-1998
[CASH] 368149
[SECURITIES] 0
[RECEIVABLES] 1777761
[ALLOWANCES] 0
[INVENTORY] 731272
[CURRENT-ASSETS] 3407109
[PP&E] 1903483
[DEPRECIATION] 1240835
[TOTAL-ASSETS] 6058550
[CURRENT-LIABILITIES] 2840392
[BONDS] 0
[PREFERRED-MANDATORY] 0
[PREFERRED] 0
[COMMON] 5821802
[OTHER-SE] (2625253)
[TOTAL-LIABILITY-AND-EQUITY] 6058550
[SALES] 4513235
<TOTAL REVENUES> 4516239
[CGS] 3133311
[TOTAL-COSTS] 5473986
[OTHER-EXPENSES] 14151
[LOSS-PROVISION] 0
[INTEREST-EXPENSE] 37317
[INCOME-PRETAX] (1009215)
[INCOME-TAX] 0
[INCOME-CONTINUING] (1009215)
[DISCONTINUED] 0
[EXTRAORDINARY] 0
[CHANGES] 0
[NET-INCOME] (1009215)
[EPS-BASIC] (.35)
[EPS-DILUTED] (.35)
</TABLE>
CREATIVE COMPUTER APPLICATIONS, INC.
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> AUG-31-1999
<PERIOD-END> MAY-31-1999
<CASH> 766319
<SECURITIES> 0
<RECEIVABLES> 2784765
<ALLOWANCES> 0
<INVENTORY> 586867
<CURRENT-ASSETS> 4790137
<PP&E> 1959867
<DEPRECIATION> 1354646
<TOTAL-ASSETS> 7870812
<CURRENT-LIABILITIES> 3543333
<BONDS> 0
0
0
<COMMON> 5981067
<OTHER-SE> (1653588)
<TOTAL-LIABILITY-AND-EQUITY> 7870812
<SALES> 6460467
<TOTAL-REVENUES> 6467767
<CGS> 3261977
<TOTAL-COSTS> 5819580
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 34435
<INCOME-PRETAX> 613752
<INCOME-TAX> 2400
<INCOME-CONTINUING> 611352
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 611352
<EPS-BASIC> .21
<EPS-DILUTED> .19
</TABLE>
