SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For three months ended March 31, 1997 Commission File No. 283574
------
ISRAMCO, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
DELAWARE 13-3145265
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(State or other jurisdiction of (I.R.S. Employer I.D. No.)
incorporation or organization)
575 Madison Avenue, Suite 1006, New York, New York 10022
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 212-605-0417
------------
NOT APPLICABLE
- --------------------------------------------------------------------------------
(Former name, former address and formal 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 twelve months (or for such shorter period that the
registrant was required to such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
------- -------
26,398,523 Common Shares were outstanding as of March 31, 1997.
<PAGE>
ISRAMCO, INC.
INDEX
PAGE NO.
Part I. Financial Information
Item 1. Financial statements
Consolidated balance sheet as of March 31, 1997 (unaudited) 1
Consolidated statements of operations (unaudited):
- Three months ended March 31, 1997 and 1996 2
Consolidated statements of cash flows (unaudited):
- Three months ended March 31, 1997 and 1996 3
Notes to consolidated financial statements 4-5
Item 2. Management's discussion and analysis of financial statements 6-11
Part II. Other information
Signatures 12
<PAGE>
ISRAMCO, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
AS AT MARCH 31, 1997
(Unaudited)
A S S E T S
-----------
Current assets:
Cash including cash equivalents . . . . . . . . . . $ 14,343,941
Accounts receivable - oil and gas sales . . . . . . 402,722
Other receivable . . . . . . . . . . . . . . . . . . 545,918
Marketable securities, at market . . . . . . . . . . 7,596,953
Prepaid expenses and other . . . . . . . . . . . . . 368,981
Total current assets . . . . . . . . . . . . 23,258,515
Oil and gas properties, net . . . . . . . . . . . . . . 4,513,446
Equipment, net . . . . . . . . . . . . . . . . . . . . 89,260
Covenants not to compete, net . . . . . . . . . . . . . 350,000
Other assets . . . . . . . . . . . . . . . . . . . . . 82,161
------------
T O T A L . . . . . . . . . . . . . . . . . . $ 28,293,382
============
LIABILITIES AND SHAREHOLDERS' EQUITY
------------------------------------
Current liabilities:
Accounts payable and accrued expenses . . . . . . . $ 550,359
Current portion of long-term debt . . . . . . . . . 780,000
------------
Total current liabilities . . . . . . . . . . 1,330,359
Long-term debt . . . . . . . . . . . . . . . . . . . . 3,283,334
------------
4,613,693
Minority interest . . . . . . . . . . . . . . . . . . . 208,182
------------
Shareholders' equity:
Common stock, $.01 par value; authorized 75,000,000
shares; issued 26,691,198 . . . . . . . . . . . . 266,912
Additional paid-in capital . . . . . . . . . . . . . 25,927,635
Accumulated deficit . . . . . . . . . . . . . . . . (2,559,142)
Treasury stock; 292,675 shares . . . . . . . . . . . (163,898)
------------
23,471,507
T O T A L . . . . . . . . . . . . . . . . . . $ 28,293,382
============
See notes to the consolidated financial statements.
- 1 -
<PAGE>
ISRAMCO INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
Three Months Ended
March 31,
----------------------------
1997 1996
------------ ------------
Revenues:
Operator fees from related party . . . . . $ 108,000 $ 126,252
Oil and gas sales . . . . . . . . . . . . . 557,069
Interest income . . . . . . . . . . . . . . 284,520 307,606
Gain on marketable securities . . . . . . . 335,526 165,922
Office services to affiliates and other . . 119,264 132,376
------------ ------------
Total revenues . . . . . . . . . . . 1,404,379 732,156
------------ ------------
Expenses:
Interest expense . . . . . . . . . . . . . 30,324 476
Depreciation, depletion and amortization . 180,168 15,734
Lease operating expenses . . . . . . . . . 173,571
Operator costs. . . . . . . . . . . . . . . 216,158 162,183
General and administrative - in part to
related parties . . . . . . . . . . . . . 227,317 217,168
Research and development . . . . . . . . . (1,041)
------------ ------------
Total expenses . . . . . . . . . . . 827,538 394,520
------------ ------------
Income before taxes and minority interest . . 576,841 337,636
Provision for income taxes . . . . . . . . . . - 0 - - 0 -
------------ ------------
Income from operations before minority
interest . . . . . . . . . . . . . . . . . 576,841 337,636
Minority interest . . . . . . . . . . . . . . (33,878)
------------ ------------
NET INCOME . . . . . . . . . . . . . . . . . . $ 542,963 $ 337,636
============ ============
Earnings per share . . . . . . . . . . . . . . $ .02 $ .01
============ ============
Weighted average number of shares . . . . . . 26,398,523 26,691,198
============ ============
See notes to the consolidated financial statements.
- 2 -
<PAGE>
<TABLE>
<CAPTION>
ISRAMCO INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months Ended
March 31,
---------------------------------------
1997 1996
------------ ------------
Cash flows from operating activities:
<S> <C> <C>
Net income . . . . . . . . . . . . . . . . $ 542,963 $ 337,636
Adjustments to reconcile net income to net
cash (used in) provided by operating
activities:
Depreciation, depletion and
amortization . . . . . . . . . . . . 180,168 15,734
Minority interest . . . . . . . . . . . 33,878
(Gain) on marketable securities . . . . (335,526) (165,922)
Loss on sale of equipment . . . . . . . 748 6,587
Changes in assets and liabilities:
Prepaid expenses and other current
assets . . . . . . . . . . . . . . (39,764) (43,341)
Accounts payable and accrued expenses 158,645 (19,246)
Purchase of marketable securities . . (1,509,916)
Proceeds from sale of marketable
securities . . . . . . . . . . . . 726,443 87,527
Accounts receivable . . . . . . . . . (787,706)
Other assets . . . . . . . . . . . . 187,500
------------ ------------
Net cash (used in) provided by
operating activities . . . . . . (842,567) 218,975
------------ ------------
Cash flows from investing activities:
Purchase of oil and gas properties . . . . . (2,771,068) (5,599)
Purchase of equipment . . . . . . . . . . . (19,583) (1,000)
Proceeds from sale of equipment . . . . . . 5,616 460
Purchase of Jay Petroleum LLP from
affiliate, net of cash acquired . . . . . (1,035,673)
------------ ------------
Net cash (used in) investing
activities . . . . . . . . . . . (3,820,708) (6,139)
------------ ------------
Cash flows from financing activities:
Proceeds of borrowings, net . . . . . . . . 2,980,834
Other . . . . . . . . . . . . . . . . . . . 27,360
------------
Net cash provided by financing
activities . . . . . . . . . . . 3,008,194
------------
NET INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS . . . . . . . . . . . . . (1,655,081) 212,836
Cash and cash equivalents, beginning of period 15,999,022 16,506,242
------------ ------------
CASH AND CASH EQUIVALENTS, END OF PERIOD . . . $ 14,343,941 $ 16,719,078
============ ============
Supplemental disclosure of cash flow information:
Cash paid during the period for interest $ 30,324 $ 476
</TABLE>
See notes to the consolidated financial statements.
- 3 -
<PAGE>
ISRAMCO, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
(NOTE 1):
- ---------
As used in these financial statements, the term "Company" refers to
Isramco, Inc. and subsidiaries.
(NOTE 2):
- ---------
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB. 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 only normal recurring adjustments)
considered necessary for a fair presentation have been included. Operating
results for the three-month period ended March 31, 1997 are not necessarily
indicative of the results that may be expected for the year ending December 31,
1997. For further information, refer to the consolidated financial statements
and footnotes thereto incorporated by reference in the Company's Annual Report
on Form 10-K for the year ended December 31, 1996.
(NOTE 3) - Consolidation:
- -------------------------
The consolidated financial statements include the accounts of the Company,
its direct and indirect wholly owned subsidiaries, Isramco Oil & Gas Ltd. ("Oil
& Gas") and Isramco Underwriters, Ltd., both Israeli companies, Isramco
Resources, Inc., a British Virgin Islands company, its majority owned
subsidiary, Jay Petroleum, LLC ("Jay") and an immaterial foreign wholly owned
subsidiary. All intercompany balances and transactions have been eliminated.
Another wholly owned subsidiary of the Company, Isramco Management (1988) Ltd.,
an Israeli company, is not included in the consolidation because the Company has
no voting rights. This entity serves as the nominee for the unit holders of a
limited partnership and has no significant assets or operations.
(NOTE 4) - Acquisition of Oil and Gas Properties:
- -------------------------------------------------
On February 5, 1997 the Company acquired an 82.9% membership interest in
Jay at an aggregate cost of $1.2 million; $677,500 for a 50% interest from NIR
Resources, Inc. ("NIR"), $363,750 for a 25% interest from Stonewall Resources,
LLC, and $132,650 as a capital contribution to Jay for a 7.9% interest. The
Company's share of profits after recovery of its investment is 70.06%. NIR is a
wholly owned subsidiary of Naphtha Israel Petroleum Corporation Limited, holder
of 36% of the Company's outstanding common stock.
(continued)
- 4 -
<PAGE>
ISRAMCO, INC. AND SUBSIDIARIES
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
(NOTE 4) - Acquisition of Oil and Gas Properties: (continued)
- -------------------------------------------------
On February 13, 1997 Jay acquired from Snyder Oil Corporation of Fort
Worth, Texas, various operated and nonoperated interests in oil and gas wells in
Louisiana, Texas and Wyoming for a cost of $3.1 million. The acquisition was
financed primarily with bank financing obtained by Jay through a $10 million
Master Note Facility with Comerica Bank - Texas, Houston, Texas. Isramco, Inc.
is not a borrower or guarantor under this Master Note Facility.
The acquisitions have been accounted for as purchases. Accordingly, the
consolidated financial statements include the operations of the acquired
entities from the dates of acquisition.
(NOTE 5) - Income Taxes:
- ------------------------
There is no income tax expense for the three months ended March 31, 1997
because taxes which would have been accrued were offset by a reduction in the
deferred tax asset valuation allowance of $217,000.
(NOTE 6) - Long-term Debt:
- --------------------------
At March 31, 1997, Jay has outstanding indebtedness of $4,063,000 under a
bank loan facility of $10 million. The loan bears interest at prime plus 1.5%
with monthly payments of $65,000 plus interest and matures in February 2000. The
loan is secured by oil and gas properties and shall never exceed the "Borrowing
Base", as defined, which is subject to annual redetermination.
- 5 -
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
The Company in February 1997 purchased for $1,041,620 a 75% membership interest
in Jay Petroleum LLC ("Jay") (before recovery of contributions) which interest
for profit allocation purposes reduces to 56.25% after recovery of all capital
contributions made by the members.
The Company also made a $132,650 capital contribution to Jay and received from
Jay Resources Corp. a 7.9% Membership Interest in Jay which interest increases
to an allocation of profits percentage of 13.81% after recovery of capital
contributions.
The Company now holds an 82.9% Membership Interest in Jay. The Company's share
of profits before recovery of capital contribution in Jay is 82.9% and after
recovery of capital contribution the allocation of profit participation will be
reduced to 70.06%.
The acquisition of the interests in Jay, as well as the capital contribution
made by the Company to Jay was made out of working capital funds available to
the Company.
The consolidated financial statements for the three month period ended March 31,
1997 include the operations of Jay from the date of acquisition.
During the three month period ended March 31, 1997 the Company invested in
certain oil and gas activities in the United States through Jay and continued to
participate in work programs in the Negev Med Venture, the Yam Ashdod Carveout
and the Shederot Venture, all of them in Israel as hereinafter discussed.
Liquidity and Capital Resources
During the three month period ended March 31, 1997 the Company purchased certain
operated and non-operated interests in oil and gas properties in Louisiana,
Texas and Wyoming for $2,765,104, and, invested $1,829 in exploration for oil
and gas in Israel, in the ventures which the Company is the Operator. During
this period, the Company, as an operator, continued its search for available
marine drilling rigs for the work plans in the offshore licenses and continued
drilling preparations for the Gevia-1 well on the onshore shederot license.
- 6 -
<PAGE>
During the first quarter of 1996 the Company expended $5,599 in oil and gas
exploration in Israel, mainly in intensive activity of seismic interpretation
and subsurface mapping over the areas of the six offshore licenses and the
onshore license.
In the three month period ended March 31, 1997 the Company had net cash outflow
from the purchase and sales of marketable securities of $783,473 as compared to
cash inflow of $87,527 from sales of marketable securities in the three month
period ended March 31, 1996. As of March 31, 1997, the Company owned 5.5% of the
issued shares of J.O.E.L. - Jerusalem Oil Exploration Ltd. ("J.O.E.L."), the
controlling shareholder of Naphtha Israel Petroleum Company Ltd. ("Naphtha"),
holder of approximately 36% of the Company's outstanding common stock. Shares of
J.O.E.L. and Naphtha are traded on the Tel Aviv Stock Market.
Jay has borrowed $4,063,000 under the Comerica Credit Facility at a rate of
prime plus 1.25% with payments of $65,000 plus interest monthly. The loan is due
on February 5, 2000. Additional draw downs under the Comerica Credit Facility
require bank approval and the loan is subject to an annual borrowing base
redetermination review commencing August 1, 1997.
Oil and Gas Revenues (Three months ended March 31, 1997)
- --------------------------------------------------------
Oil Volume Sold (Barrels)
Farmers - 5,000
Snyder - 3,600
Total - 8,600
Gas Volume Sold (MCf)
Farmers - 55,800
Snyder - 92,900
Total - 148,700
Oil Sales ($)
Farmers - $109,000
Snyder - $ 79,000
Total - $188,000
Gas Sales ($)
Farmers - $145,000
Snyder - $224,000
Total - $369,000
Average Unit Price
Oil ($/Bbl)* - $21.77
Gas ($/MCf)** - $2.48
* Bbl = Stock tank barrel equivalent to 42 U.S. gallons
** MCf = 1,000 cubic foot
- 7 -
<PAGE>
Results of Operations
- ---------------------
United States
- -------------
In the first quarter of 1997 Jay purchased producing oil and gas reserves from
Snyder for $3.1 million. The purchase was financed by the Comerica Credit
Facility.
During the first quarter Jay began a water flood project in Jack County, Texas
at an estimated cost of $60,000. Jay owns a 100% interest in the field. During
the second quarter Jay plans to drill a gas well in Garfield County, Oklahoma at
an estimated cost through completion of $188,000 or $115,000 for a dry hole. Jay
owns a 75% working interest in the proposed well.
Israel
- ------
The Company holds 1.0043% working interest in each of the Petroleum Assets held
by the various ventures and is the operator of the same ventures.
Negev Med Venture
- -----------------
Two seismic surveys were carried out and two wells were drilled (the Yam Yafo 1
and the Yam West 1) by the Negev Med Venture since its inception. During 1995
and the beginning of 1996, the activity of seismic interpretation, subsurface
mapping and prospects evaluation have been carried out over the five licenses of
the Venture.
The accumulated data on Authorization for Expenditure (AFEs in the five licenses
of the Venture) is as follows:
<TABLE>
<CAPTION>
Total Accumulated
Expenses from
Inception Date
Expended in of Licenses
License AFE January-March 1997 from May 1, 1993 Company's Share
- ------- --- ------------------ ---------------- ---------------
<S> <C> <C> <C> <C>
Med Tel Aviv $39,217,500 $11,933 $38,506,173 $386,717
Med Yavne 25,032,500 36,180 23,628,838 237,304
Med Hasharon 1,514,000 21,175 1,329,958 13,357
Med Hadera 977,500 21,330 816,419 8,199
Med Ashdod 762,000 -0- 759,934 7,632
---------- --------- ----------- --------
$67,503,500 $90,618 $65,041,209 $653,210
</TABLE>
The duration of the Med Tel Aviv, Med Yavne, Med Hasharon, Med Hadera and Med
Ashdod Licenses is until June 15, 2000 pursuant to the following conditions: the
Company will have to carry out a seismic survey of at least 500 kilometers.
- 8 -
<PAGE>
Two wells are required to be drilled in the area of the licenses to a minimum
depth of 9,840 feet. The first well should be spudded no later than January 1,
1998 and the second one by no later than one year after the first well. In
addition, the Company is required to carry out deepening and retesting of the
Yam 2 well by no later than January 1, 1998. These are conditions of the
offshore licenses. If the conditions of the licenses are not satisfied the
licenses may terminate.
In June 1996, the Petroleum Commissioner approved the relinquishment of the
Negev Ashquelon licenses and the change of boundaries of the Med Ashdod license.
As a result of these changes, the Med Ashdod license now includes the area of
structure on which the Yam 1 and Yam 2 wells were drilled, as well as other
additional potential structures which were part of the area of the relinquished
Negev Ashquelon license. The participants delineated a carveout within the area
of the Med Ashdod license and this carveout includes all the areas which were
transferred from the Negev Ashquelon license as described above. The Company
expects to be entitled to the same royalties in this carveout as to those which
were in the relinquished Negev Ashquelon license (including the Yam Carveout).
The participants' share in the new carveout will be the same as in the Yam
Carveout which was part of the Negev Ashquelon license.
The Yam Ashdod Carveout (within the Med Ashdod License)
- -------------------------------------------------------
In September 1996, the participants in the Med Ashdod license signed an
agreement to create a carveout area within the license in which the exploration
program would be conducted and in which the respective interests of the parties
would be as they were in the Yam Carveout. The parties adopted the Joint
Operating Agreement (J.O.A.) of the Negev 2 Joint Venture dated June 30, 1988,
subject to amendments, adjustments and modifications. According to the J.O.A.,
the Company is the operator and is entitled to an operating fee of 6% of all
gross direct charges, but not less than $6,000 per month. As long as no
exploration activity takes place within the license area but outside the Yam
Ashdod Carveout, no operating fee will be charged under the J.O.A. with respect
to the license area outside the Yam Ashdod Carveout. The participants approved
an AFE in the amount of $248,000. The Company's share is 1.0043% or $2,491.
During the three month period ended March 31, 1997, the work program in the Yam
Ashdod Carveout Venture consisted of searching for suitable rig for re-entry and
deepening the Yam 2 well and/or another deep well and attempts to survey and
detect the wellhead of the Yam 2 well and continue attempts of coordination with
Ministry of Defense. All activities as not so far supply positive results.
During the three month period ended March 31, 1997 the Yam Ashdod Carveout
Venture expended $42,564. The Company's share is 1.0043% or $427.
- 9 -
<PAGE>
Shederot Venture
- ----------------
During the three month period ending March 31, 1997, the Company as the operator
continued the preparatory work of the drilling prospect, the drilling program
including availability of equipment and materials in Israel and surveying the
proposed well site. During the three month period ended March 31, 1997, the
Shederot Venture expended $48,956. The Company's share is 1.0043% of $492. The
total AFEs approved by the participants from inception date until March 1997 is
$441,000. The Company's share is 1.0043% or $4,429.
In this stage Isramco as operator did not issue yet an AFE for all cost of
drilling and testing to be approved by participants.
Operator's Fees
- ---------------
In the three month periods ended March 31, 1997 and 1996, the Company earned
$108,000 and $126,000, respectively, which were based on the minimum monthly
compensation for each period. The Company believes that operator's fees during
April - December 1997 will be based mainly on the minimum monthly compensation
which at present is $36,000 per month ($6,000 x 6 licenses).
Oil and Gas Revenues
- --------------------
In the three month period ended March 31, 1997 the Company had, prior to
minority interest, oil and gas revenues of $557,000.
Lease Operating Expenses
- ------------------------
In the three month period ended March 31, 1997, the oil and gas expenses were
mainly in connection with oil and gas fields in United States, as compared to
the same period in 1996 in which, all these expenses were mainly in the various
ventures in Israel. Lease operating expenses in the United States were
approximately $173,751.
Interest Income
- ---------------
Interest income decreased in the three month period ended March 31, 1997
compared to interest income in the three month period ended March 31, 1996
mainly due to lower average investment balances.
Gain on Marketable Securities
- -----------------------------
In the three month period ending March 31, 1997, the Company had net realized
and unrealized gains of $335,526 from marketable securities as compared to
$165,922 for the same period in 1996. The gain for 1997 includes an unrealized
gain of $266,444 from the Company's investment in J.O.E.L. As at May 9, 1997,
that gain decreased by $286,152.
- 10 -
<PAGE>
Operator Costs
- --------------
Operator costs increased in the three month periods ended March 31, 1997 and
1996 as compared to the three month period ended March 31, 1996, as a result of
expenses from foreign currency exchange and legal expenses. Part of the increase
was offset by lower manpower costs and rent payments to J.O.E.L. for the Company
offices in Israel.
General and Administrative Expenses
- -----------------------------------
General and Administrative expenses during the three month period ended March
31, 1997 in the aggregate were comparable to those during the three month period
ended March 31, 1996.
General and administrative expenses for the three month period ended March 31,
1997 includes approximately $32,000 added from the operations of Jay and
approximately $32,500 of charges resulting from non-compete agreements.
Directors' fees and office services in New York decreased in the three month
period in 1997 as compared to 1996.
Minority Interest
- -----------------
Minority interest for the three month period ended March 31, 1997 represents the
minority share (17.1%) of Jay's net income.
- 11 -
<PAGE>
ISRAMCO, INC.
PART II. OTHER INFORMATION
Item 6. Reports on Form 8-K
--------------------
Form 8-K for the month of February, 1997 dated February 14, 1997;
Form 8 to Form 8-K for the month of February, 1997 dated April 17, 1997;
Form 8 to Form 8-K for the month of February, 1997 dated May 12, 1997;
Form 8-K for the month of March, 1997 dated March 31, 1997.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ISRAMCO, INC.
--------------------------------
(Registrant)
Date: May 13, 1997
By: s/Haim Tsuff
---------------------------
(Signature)
Haim Tsuff
Chairman of the Board and
Chief Executive Officer
By: s/Daniel Avner
-------------------------
(Signature)
Daniel Avner
Principal Financial Officer
- 12 -
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 14,343,941
<SECURITIES> 7,596,953
<RECEIVABLES> 948,640
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 23,258,515
<PP&E> 4,602,706
<DEPRECIATION> 0
<TOTAL-ASSETS> 28,293,382
<CURRENT-LIABILITIES> 1,330,359
<BONDS> 0
0
0
<COMMON> 266,912
<OTHER-SE> 23,204,595
<TOTAL-LIABILITY-AND-EQUITY> 28,293,382
<SALES> 557,069
<TOTAL-REVENUES> 1,404,379
<CGS> 173,571
<TOTAL-COSTS> 827,538
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 30,324
<INCOME-PRETAX> 576,841
<INCOME-TAX> 0
<INCOME-CONTINUING> 576,841
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 542,963
<EPS-PRIMARY> .02
<EPS-DILUTED> .02
</TABLE>
