UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
XX QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
AND EXCHANGE ACT OF 1934 For the quarterly period ended June 30,
1999
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES AND EXCHANGE ACT OF 1934
Commission File Number 0-10054
COMMODORE ENVIRONMENTAL SERVICES, INC.
--------------------------------------
(Exact name of Registrant as specified in its charter)
DELAWARE 87-0275043
-------- ----------
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
150 East 58th Street,
New York, New York 10155
-------------------- -----
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (212) 308-5800
-------------
Not Applicable
--------------
(Former name, 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 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 NO X
Number of shares of common stock outstanding at December 31, 1999 (latest
practicable date):
Issued and Outstanding: 62,796,477
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<PAGE>
COMMODORE ENVIRONMENTAL SERVICES,INC
FORM 10-Q
INDEX
PAGE
----
PART I. FINANCIAL INFORMATION .................................. 3
- ------- ---------------------
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets -
June 30, 1999 and December 31, 1998................... 3
Condensed Consolidated Statement of Operations
Three months ended June 30, 1999 and
1998 and Six months ended June 30, 1999
and 1998.............................................. 5
Condensed Consolidated Statement of Cash Flows
Six months ended June 30, 1999 and
June 30, 1998......................................... 6
Notes to Condensed Consolidated Financial Statements.... 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations................ 8
PART II. OTHER INFORMATION ...................................... 14
- -------- -----------------
SIGNATURES .......................................................... 15
2
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1: Financial Statements
--------------------
COMMODORE ENVIRONMENTAL SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
(000'S Omitted)
June 30, December 31,
1999 1998
------------- -------------
ASSETS (unaudited) (unaudited)
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 51 $ 712
Accounts receivable, net 21 1
Restricted cash 260 260
Inventory 504 685
------------ -----------
TOTAL CURRENT ASSETS 836 1,658
Other receivables 321 321
Other investments 4,139 4,630
Property and equipment, net 929 1,154
Patents and completed technology, net 150 148
Net assets of discontinued operations 100 100
Other assets 18 18
------------ -----------
TOTAL ASSETS $ 6,493 $ 8,029
============ ===========
</TABLE>
See notes to condensed consolidated financial statements.
3
<PAGE>
COMMODORE ENVIRONMENTAL SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS -- (CONT'D)
<TABLE>
<CAPTION>
(000'S Omitted)
June 30, December 31,
1999 1998
------------- -------------
LIABILITIES AND STOCKHOLDER'S EQUITY (unaudited) (unaudited)
<S> <C> <C>
Current Liabilities:
Accounts payable and accrued liabilities $ 765 $ 78
Due to related parties 1,090 281
Unearned revenue 263 450
Bond payable 4,000 -
Other accrued liabilities 1,054 1,287
------------ -----------
TOTAL CURRENT LIABILITIES 7,172 2,096
Bonds payable and other long-term debt - 4,000
Promissory note to related party 2,250 2,250
------------ -----------
TOTAL LIABILITIES 9,422 8,346
Minority interest in subsidiary 1,198 2,105
Stockholders' Equity:
Preferred stock, par value $.01 per share
authorized 10,000,000 issued and
outstanding 3,917,378 and 3,917,378 39 39
Common stock, par value $.01 per share
authorized 100,000,000, issued and
outstanding 62,796,477 and 62,796,477 628 628
Additional paid in capital 46,741 46,741
Deficit (51,510) (49,805)
------------ -----------
(4,102) (2,397)
Less cost of 506,329 shares of common stock
held in treasury (25) (25)
------------ -----------
TOTAL STOCKHOLDERS' EQUITY (4,127) (2,422)
------------ -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 6,493 $ 8,029
============ ===========
</TABLE>
See notes to condensed consolidated financial statements.
4
<PAGE>
COMMODORE ENVIRONMENTAL SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
(000's Omitted)
Three months Six months
Ended June 30, Ended June 30,
1999 1998 1999 1998
---------- ----------- ---------- ----------
(unaudited) (unaudited)
<S> <C> <C> <C> <C>
REVENUES
Contract revenues $ 20 $ $ 284 $ 1,259
COSTS AND EXPENSES
Cost of sales 50 369 961
Research and development 110 200 173
General and administrative 487 283 910 1,711
Depreciation and amortization 130 74 260 170
---------- ----------- ---------- ----------
Total costs and expenses 777 357 1,739 3,015
OPERATING LOSS (757) (357) (1,455) (1,756)
Other income (expense):
Interest income 1 151 11 283
Interest expense (130) (154) (260) (313)
Equity in losses from unconsolidated
subsidiary (184) (1,605) (492) (2,851)
Gain on sale of subsidiary stock 381 8,024
Minority interest 488 907 418
---------- ----------- ---------- ----------
INCOME (LOSS) FROM CONTINUING
OPERATIONS (582) (1,584) (1,289) 3,805
Discontinued operations (224) (41) (416) (41)
---------- ----------- ---------- ----------
NET INCOME (LOSS) $ (806) $ (1,625) $ (1,705) $ 3,764
========== =========== ========== ==========
NET INCOME (LOSS) PER SHARE - Basic
(Based on weighted average shares of
62,290,000 and 62,290,000 in 1999
and 61,350,000 and 60,412,000 in
1998) $ (.01) $ (.03) $ (.03) $ .06
========== =========== ========== ==========
NET INCOME (LOSS) PER SHARE - Diluted
(Based on weighted average shares of
62,290,000 and 62,290,000 in 1999
and 61,350,000 and 66,712,000 in
1998) $ (.01) $ (.03) $ (.03) $ .06
========== =========== ========== ==========
</TABLE>
See notes to condensed consolidated financial statements.
5
<PAGE>
COMMODORE ENVIRONMENTAL SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
(000'S Omitted)
Six months ended
June 30,
1999 1998
------------- -------------
(unaudited) (unaudited)
<S> <C> <C>
OPERATING ACTIVITIES
Net income (loss) $ (1,705) $ 3,764
Adjustments to reconcile net income (loss) to
net cash provided by operating activities:
Depreciation and amortization 260 170
Interest (non cash) 48
Gain on sale of subsidiary stock (8,024)
Undistributed losses of unconsolidated subsidiary 491 2,851
Changes in net assets of subsidiary prior to
deconsolidation 3,236
Minority ownership in losses (907) (418)
Changes in assets and liabilities:
Accounts receivable (9)
Inventories 181
Other assets 1
Accounts payable and accrued liabilities 908 170
Unearned revenue (187)
Other current liabilities (233)
------------ -----------
NET CASH (USED IN) OPERATING ACTIVITIES (1,200) 1,797
------------ -----------
INVESTING ACTIVITIES
Payments received on receivables 198
Acquisition of patents (8) (30)
Acquisition of completed technology (4,436)
Purchase of equipment (2)
------------ -----------
NET CASH (USED IN) INVESTING ACTIVITIES (10) (4,268)
------------ -----------
FINANCING ACTIVITIES
Proceeds from sale of subsidiary stock 5,450
Payment of dividends on preferred stock (125)
Payments from related parties 547 104
Advances to related parties (5,450)
------------ -----------
NET CASH PROVIDED BY (USED IN) FINANCING
ACTIVITIES 547 (21)
------------ -----------
INCREASE (DECREASE) IN CASH (663) (2,492)
Deconsolidation of subsidiary owned cash (11,015)
Cash at beginning of period 714 13,542
------------ -----------
CASH AT END OF PERIOD $ 51 $ 35
============ ===========
</TABLE>
See notes to condensed consolidated financial statements.
6
<PAGE>
COMMODORE ENVIRONMENTAL SERVICES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
June 30, 1999
Note A - Basis of Presentation
The accompanying unaudited condensed consolidated financial statements for
Commodore Environmental Services, Inc. and Subsidiaries (the "Company") have
been prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-Q and Article
10 of Regulation S-X. The financial statement information was derived from
unaudited financial statements unless indicated otherwise. Accordingly, they do
not include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. Operating results for the three and six month periods ended June 30,
1999 are not necessarily indicative of the results that may be expected for the
year ending December 31, 1999.
The accompanying unaudited condensed consolidated financial statements
should be read in conjunction with the Company's audited financial statements
included in the Company's Annual Report on Form 10-K for the year ended December
31, 1998.
Note B - Commitments and Contingencies
The Company has matters of litigation arising in the ordinary course of its
business which in the opinion of management will not have a material adverse
effect on the financial condition or results of operations of the Company.
7
<PAGE>
ITEM 2. Management's Discussion and Analysis of Financial
Condition and Results of Operation
----------------------------------
General
- -------
The current principal businesses of the Company are conducted through its
49% owned affiliate Applied, and consist of the development of technologies for
the destruction and neutralization of hazardous waste and the separation of
hazardous waste from other materials. Applied owns technologies related to the
separation and destruction of polychlorinated biphenyls (PCBs) and
chloroflourocarbons (CFCs).
Applied is currently working on the commercialization of these technologies
through various acquisitions licensing agreements and joint ventures. Through
Advanced Sciences, Inc. ("ASI")., a subsidiary acquired in October 1996, Applied
has contracts with various government agencies and private companies in the
United States and abroad. As some government contracts are funded in one year
increments, there is a possibility for cutbacks. As these contracts constitute a
major portion of the subsidiary's revenues, such a reduction would materially
affect the operations. However management believes the subsidiary's existing
client relationships will allow Applied to obtain new contracts in the future.
Applied's principal businesses consist of the development of technologies or
the destruction or neutralization of hazardous waste and the separation of
hazardous waste from other materials. Applied owns technologies related to the
separation and destruction of polychlorinated biphenyls (PCBs) and
chloroflourocarbons (CFCs). In addition, Applied owns 100% of Advanced Sciences,
a subsidiary acquired in October 1996. Advanced Sciences has contracts with
various government agencies and private companies throughout the United States
and abroad relating engineering and scientific services. The consolidated
financial statements do not include the accounts of Applied and its
majority-owned subsidiaries.
Commodore Separation Technologies, Inc., a subsidiary of Applied, whose
principal business is to separate and extract various solubilized materials from
liquid streams is currently in the development stage and intends to
commercialize its separation and recovery system.
In March 1998, the Company, through its wholly-owned subsidiary Commodore
Polymer Technologies, Inc., ("Polymer Technologies"), purchased the business
(consisting of customer, supplier and industry relationships) related to the
ceramic polymer known as CERASET (the "CERASET Business") from a subsidiary of
Lanxide, a company which specializes in the manufacture of ceramic bonding and
refractory materials. In connection with such purchase, Polymer Technologies
8
<PAGE>
also required a license, subject to pre-existing and certain future licenses, to
utilize the technologies related to the CERASET polymers (the "CERASET
License"), and acquired the right to use the trademark "CERASET" in connection
with the marketing and sales of products containing CERASET polymers (the
CERASET Trademark"), on a worldwide basis (excluding Japan). The CERASET
materials and processes provide additional performance advantage for reinforced
metals and reinforced ceramics, and extend the Company's business portfolio into
rapidly expanding area of high-performance polymer composites, adhesives,
sealants and coatings. Lanxide is affiliated with the Company by significant
common beneficial ownership.
Pursuant to the terms of the CERASET License, Polymer Technologies has
agreed to pay a subsidiary of Lanxide a royalty equal to 4% of the net sales
price of all products sold by Polymer Technologies and any of its sublicensees,
which are manufactured using the CERASET technology until the aggregate royalty
payments equal $4 million. Thereafter, Lanxide's subsidiary will be entitled to
receive a royalty payment equal to 2% of the net sales price of all products
sold by Polymer Technologies and its sublicensees, which are manufactured using
the CERASET technology.
Polymer Technologies was incorporated in Delaware on March 3, 1998, has
commenced operations and has generated nominal revenues to date. From 1998 to
March 6, 2000, CERASET has generated approximately $80,000 in revenues. Due to
the limited success in expanding its sales, the Company believed that the
CERASET License, CERASET Business and CERASET Trademark have a nominal value and
should be written down to $100,000 as of December 31, 1998. Since 1998, the
Company has embarked on efforts to develop new polymer technologies. In doing
so, the Company has expensed approximately $240,000 in 1998 and $410,000 in 1999
in research and development expense with respect to these new polymers (not
including CERASET). The new polymers serve some of the same properties however
the new polymers are not dependent on CERASET. In March 2000, the Company sold
Polymer Technologies to the Blum Technology Trust for $1,588,902. The
consideration was determined to be a good faith negotiation among the parties to
the transfer of the Polymer stock taking into consideration Polymer's net worth
of approximately $100,000.
9
<PAGE>
Results from Operations
- -----------------------
Three and Six Months Ended June 30, 1999 Compared to Three and Six Months Ended
June 30, 1998
Gross revenues for the second quarter of 1999 were $20,000 as compared to
$0 for the second quarter of 1998. Gross revenues for the six month period ended
June 30, 1999 were $284,000 as compared to $1,259,000 for the six month period
ended June 30, 1998. Such revenues for 1998 were primarily due to one month of
Applied's operations. As of February 1998, the Company no longer consolidates
the financial results of Applied and its subsidiaries Separation and Advanced
Sciences, as its ownership percentage had decreased to below 50%. 1999 revenues
resulted primarily from the commencement of a project at the Port of Baltimore.
Cost of sales for the three and six months ended June 30, 1999 were $50,000 and
$369,000 as compared to $0 and $961,000 for the three and six months ended June
30, 1998. The 1998 cost of sales were principally due to one month of Applied
results.
General and administrative expenses totalled $487,000 for the second
quarter of 1999 as compared to $283,000 for the second quarter of 1998, and
general and administrative expenses totalled $1,312,000 for the six month period
ended June 30, 1999 as compared to $1,711,000 for the six month period ended
June 30, 1998. The variation in general and administrative expenses was due to
Applied results not being consolidated after January 1998. In addition, in 1999,
Separation's results are included.
In the second quarter of 1999, the Company incurred $110,000 of research and
development expenses as compared to $0 in the second quarter of 1998, for the
research, development and marketing of the destruction of hazardous substances.
For the six month period ended June 30, 1999, the Company incurred $200,000 of
research and development expenses as compared to $173,000 for the six month
period ended June 30, 1998. The increase in research and development costs is
due to Applied results not being consolidated after January 1998 and the
consolidation of Separation.
In the second quarter of 1999, the Company generated interest income of
approximately $1,000 as compared to $151,000 for the second quarter of 1998. For
the six months ended June 30, 1999, interest income was $11,000 as compared to
$283,000 for the six months ended June 30, 1998. The interest income in 1998 was
principally generated from the Company's loans to Applied.
Interest expense was $130,000 for the second quarter of 1999 as compared to
$154,000 for the second quarter of 1998; and interest expense was $260,000 for
the six month period ended June 30, 1999 as compared to $313,000 for the six
month period ended June 30, 1998. The decrease in interest expense from 1998 to
1999 was due to Applied results not being consolidated after January 1998.
10
<PAGE>
The Company recorded equity in losses of unconsolidated subsidiary of
$184,000 and $492,000 for the three and six months ended June 30, 1999 as
compared to $1,605,000 and $2,851,000 for the three and six months ended June
30, 1998. The 1998 results primarily reflect the Company's minority ownership in
Applied's losses for the respective periods.
As a result of the 1998 Private Placement of the Company owned Applied
common stock and conversions of the Series D Preferred Stock of the Company
outstanding as of December 31, 1997, the Company recorded a gain on sale of
subsidiary stock of $8,024,000 in 1998 of which $381,000 occurred in the second
quarter.
Minority interest reflects the portion of the consolidated results of the
Company which relate to minority shareholders of Applied and Separation. The
Company recorded minority interest income of $418,000 during the first month of
1998. Minority interest for 1999 relates to the portion of Separation which the
Company does not own.
In March 2000, the Company sold Polymer Technologies to the Blum Technology
Trust for $1,588,902. The consideration was determined to be a good faith
negotiation among the parties to the transfer of the Polymer stock taking into
consideration Polymer's net worth of approximately $100,000. Loss from
discontinued operations relating to Polymer Technologies amounted to $224,000
and $416,000 for the three and six month period ended June 30, 1999 and $41,000
for the three and six month period ended June 30, 1998.
The Company had a net loss of $806,000 for the three month period ended June
30, 1999 as compared to a net loss of $1,625,000 for the three month period
ended June 30, 1998. The Company had a net loss of $1,705,000 for the six month
period ended June 30, 1999 as compared to net income of $3,764,000 for the six
month period ended June 30, 1998. The fluctuation in results have been described
in the individual paragraphs above.
Liquidity and Capital Resources
- -------------------------------
On September 29, 1998, Commodore Applied Technologies, Inc. ("Applied")
transferred its 87% ownership in the Separation to Commodore Environmental
Services LLC ("LLC"), a wholly-owned subsidiary of Commodore Environmental
Services, Inc. ("Environmental") in connection with a debt restructuring
agreement between Applied and Environmental.
Separation was incorporated on November 15, 1995, under the laws of the
State of Delaware. Separation is a process technology company which has
developed and continue commercializing its separation technology and recovery
system, known as SLiM (TM). Separation believes SLiM (TM) is capable of
effectively separating and extracting solubilized materials. Separation has been
11
<PAGE>
awarded its first commercial contracts in November 1997 and February 1998 and
has commenced operations on one contract in March 1999 and plans to commence
operations on the second contract in April 2000.
The Company is currently funding the financial needs of Separation along
with its current working capital and operational requirements. For the six
months ended June 30, 1999, the Company reported a net loss of $1,705,000. At
June 30, 1999, the Company had a working capital deficit of $6,336,000 as
compared to a working capital deficit of $438,000 at the December 31, 1998. The
Company did not pay dividends of $63,125 due June 30, 1999 on its Series AA
Preferred Stock.
The Company anticipates that it will need additional financing throughout
1999 and 2000 to satisfy its current operating requirements. The Company
believes that it may be able to obtain such financing through the sale of its
Applied Common Stock in one or more private placement transactions. In addition,
since the first quarter of 1999, the Company was funded through advances made
from an entity owned by its majority shareholder. As of December 31, 1999, the
majority shareholder has advanced $2,300,000 to the Company. There can be no
assurance that the majority shareholder will continue to provide adequate
financing for the Company to continue as a going concern. There also can be no
assurance that the Company will be able to obtain financing from external
sources.
Net Operating Losses
- --------------------
The Company has net operating loss carryforwards which expire in the years
2000 through 2018. The amount of net operating loss carryforward that can be
used in any one year will limited by the applicable tax laws which are in effect
at the time such carryforward can be utilized. A valuation allowance has been
established to offset any benefit from the net operating loss carryforwards as
it cannot be determined when or if the Company will be able to utilize the net
operating losses.
Forward-Looking Statements
- --------------------------
Certain matters discussed in this Annual Report are "forward- looking
statements" intended to qualify for the safe harbors from liability established
by Section 27A of the Securities Act and Section 21E of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"). These forward-looking statements
can generally be identified as such because the context of the statement will
include words such as the Company "believes," "anticipates," "expects" or words
of similar import. Similarly, statements that describe the Company's future
plans, objectives or goals are also forward-looking statements. Such statements
may address future events and conditions concerning, among other things the
Company's results of operations and financial condition; the consummation of
acquisition and financing transactions and the effect thereof on the Company's
12
<PAGE>
business; capital expenditures; litigation; regulatory matters; and the
Company's plans and objective for future operations and expansion. Any such
forward- looking statements would be subject to the risks and uncertainties that
could cause actual results of operations, financial condition, acquisitions,
financing transactions, operations, expenditures, expansion and other events to
differ materially from those expressed or implied in such forward-looking
statements. Any such forward- looking statements would be subject to a number of
assumptions regarding, among other things, future economic, competitive and
market conditions generally. Such assumptions would be based on facts and
conditions as they exist at the time such statements are made as well as
predictions as to future facts and conditions, the accurate prediction of which
may be difficult and involve the assessment of events beyond the Company's
control. Furthermore, the Company's business is subject to a number of risks
that would affect any such forward-looking statements. These risks and
uncertainties include, but are not limited to, the ability of the Company to
commercialize its technology; product demand and industry pricing; the ability
of the Company to commercialize its technology; product demand and industry
pricing; the ability of the Company to obtain patent protection for its
technology; developments in environmental legislation and regulation; the
ability of the Company to obtain future financing on favorable terms; and other
circumstances affecting anticipated revenue and costs. These risks and
uncertainties could cause actual results of the Company to differ materially
from those projected or implied by such forward-looking statements.
13
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. Legal Proceedings
There have been no material legal proceedings to which
the Company is a party which have not been disclosed in previous filings with
the Securities and Exchange Commission. There are no material developments to be
reported in any previously reported legal proceeding.
ITEM 2. Changes in Securities
Not applicable.
ITEM 3. Defaults upon Senior Securities
The Company did not pay dividends of $63,125 due June 30,
1999 on its Series AA Preferred Stock.
ITEM 4. Submission of Matters to a Vote of Security Holders
Not applicable.
ITEM 5. Other Information
Not applicable.
PART II - OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits - 27 - Financial Data Schedule
(b) Reports on Form 8-K
On August 23, 1999, the Company filed with the Securities
and Exchange Commission, the Company's Current Report on
Form 8-K, dated August 19, 1999 with respect to a change
in Independent Accountants from PriceWaterhouseCoopers to
Tanner+Co.
14
<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.
COMMODORE ENVIRONMENTAL SERVICES, INC.
(Registrant)
By: /s/ Andrew Oddi
....................................
Andrew P. Oddi - Vice President
Treasurer
(Principal Financial Officer)
Date: April 06, 2000
15
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM COMMODORE
ENVIRONMENTAL SERVICES, INC. AND SUBSIDIARIES FINANCIAL STATEMENTS AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> JUN-30-1999
<CASH> 51
<SECURITIES> 0
<RECEIVABLES> 21
<ALLOWANCES> 0
<INVENTORY> 504
<CURRENT-ASSETS> 836
<PP&E> 1,868
<DEPRECIATION> 939
<TOTAL-ASSETS> 6,493
<CURRENT-LIABILITIES> 7,172
<BONDS> 2,250
0
39
<COMMON> 628
<OTHER-SE> (4,794)
<TOTAL-LIABILITY-AND-EQUITY> 6,493
<SALES> 284
<TOTAL-REVENUES> 295
<CGS> 369
<TOTAL-COSTS> 1,739
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 260
<INCOME-PRETAX> (1,289)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,289)
<DISCONTINUED> (416)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,705)
<EPS-BASIC> (0.03)
<EPS-DILUTED> (0.03)
</TABLE>
