<PAGE>
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
--------------------
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE PERIOD ENDED SEPTEMBER 30, 1995
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 0-11453
AMERICAN PHYSICIANS SERVICE GROUP, INC.
(Exact name of registrant as specified in its charter)
TEXAS 75-1458323
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) identification No.)
1301 CAPITAL OF TEXAS HIGHWAY AUSTIN, TEXAS 78746
(Address of principal executive offices) (Zip Code)
(512) 328-0888
(Registrant's telephone number, including area code)
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
------- -------
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
NUMBER OF SHARES
OUTSTANDING AT
TITLE OF EACH CLASS OCTOBER 31, 1995
- -------------------------------------- ----------------------------
Common Stock, $.10 par value 3,639,014
================================================================================
<PAGE>
PART I
FINANCIAL INFORMATION
-2-
<PAGE>
AMERICAN PHYSICIANS SERVICE GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In thousands, except per share data)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
--------- --------- --------- ---------
Revenues:
<S> <C> <C> <C> <C>
Financial services $2,655 $2,864 8,684 7,708
Computer systems/software 1,440 1,107 3,819 3,620
Publications 0 0 757 (1)
Real estate 167 150 496 434
Investments and other 108 130 630 354
--------- --------- --------- ---------
Total revenues $4,370 $4,251 $14,386 $12,115
Expenses:
Financial service expense 2,266 2,845 7,421 7,438
Computer systems/software 1,208 1,108 3,267 3,382
Publications 275 20 1,243 169
Real estate 126 113 375 332
General and administrative 220 12 1,316 549
Interest 18 33 108 126
--------- --------- --------- ---------
Total expenses 4,114 4,131 13,730 11,996
Operating income (loss) 256 120 656 119
Equity in earnings of unconsolidated
affiliate (Note 3) 478 324 1,082 742
--------- --------- --------- ---------
Earnings before income taxes 734 444 1,738 861
Income tax 196 157 542 293
--------- --------- --------- ---------
Net earnings 538 287 1,196 568
========= ========= ========= =========
Earnings per common share:
Primary $0.14 $0.08 0.32 0.16
========= ========= ========= =========
Fully Diluted $0.14 $0.08 0.31 0.16
========= ========= ========= =========
Primary weighted average shares
outstanding 3,860 3,523 3,722 3,516
========= ========= ========= =========
Fully Diluted weighted average
shares outstanding 3,925 3,523 3,848 3,516
========= ========= ========= =========
</TABLE>
See accompanying notes to consolidated financial statements
-3-
<PAGE>
AMERICAN PHYSICIANS SERVICE GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(In thousands)
<TABLE>
<CAPTION>
September 30, December 31,
1995 1994
------------ -----------
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and cash investments $7,393 3,266
Marketable securities 519 1,491
Trading account securities 804 661
Notes receivable - current 83 325
Management fees and other receivables 1,677 2,932
Receivable from clearing broker 140 491
Deferred income taxes 274 163
Prepaid expenses and other 352 806
-------- -------
TOTAL CURRENT ASSETS 11,243 10,135
Notes receivable, less current portion 53 915
Property and equipment 2,169 2,025
Investment in Prime Medical Services, Inc. 6,986 5,658
Other assets 1,137 1,185
-------- -------
TOTAL ASSETS $21,588 19,918
======== =======
</TABLE>
See accompanying notes to consolidated financial statements
-4-
<PAGE>
AMERICAN PHYSICIANS SERVICE GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(In thousands)
<TABLE>
<CAPTION>
September 30, December 31,
1995 1994
------------ -----------
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current installments of obligations under
capital leases $289 327
Accounts payable - trade 224 809
Accrued compensation 259 488
Payable to clearing broker ---- ----
Accrued expenses and other liabilities 3,035 2,168
Federal income taxes payable 467 257
-------- -------
Total current liabilities 4,275 4,049
Long-term obligations 574 878
-------- -------
TOTAL LIABILITIES 4,849 4,927
SHAREHOLDERS' EQUITY:
Preferred stock, $1.00 par value, 1,000,000
shares authorized ---- ----
Common stock, $0.10 par value, shares
authorized 20,000,000; issued 3,639,014
at 9/30/95 and 3,471,684 at 12/31/94 363 347
Additional paid-in capital 4,472 4,469
Unrealized holding gains 34 44
Retained earnings 11,870 10,674
Reciprocal stockholdings 0 (543)
-------- -------
TOTAL SHAREHOLDERS' EQUITY 16,739 14,991
TOTAL LIABILITIES & SHAREHOLDERS' EQUITY $21,588 19,918
======== ========
</TABLE>
See accompanying notes to consolidated financial statements
-5-
<PAGE>
AMERICAN PHYSICIANS SERVICE GROUP, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
(In thousands)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
1995 1994
--------- ---------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from customers $14,982 12,485
Cash paid to suppliers and employees (12,816) (12,199)
Change in trading account securities (143) 392
Change in payable to clearing broker 351 17
Interest paid (108) (126)
Income taxes paid (444) ---
Interest, dividends and other investment
proceeds 658 (14)
--------- ---------
Net cash provided by (used in) operating
activities 2,479 555
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from the sale of marketable securiti 991 255
Payments for purchase of marketable securitie --- (536)
Proceeds from the sale of fixed assets 4 14
Payments for purchase property and equipment (406) (163)
Collection of notes receivable 1,105 1,041
Proceeds from distribution of partnership --- 146
--------- ---------
Net cash provided by investing
activities 1,694 757
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of long term obligations (340) (549)
Collection of long term obligations --- 600
Decrease in minority interest --- (51)
Exercise of stock options 304 ---
--------- ---------
Net cash provided by (used in) financing
activities (36) 0
--------- ---------
NET CHANGE IN CASH AND CASH EQUIVALENTS $4,137 1,312
========= =========
Cash and cash equivalents at beginning of perio 3,266 2,544
--------- ---------
Cash and cash equivalents at end of period $7,403 3,856
========= =========
</TABLE>
See accompanying notes to consolidated financial statements
-6-
<PAGE>
AMERICAN PHYSICIANS SERVICE GROUP, INC.
Consolidated Statements of Cash Flows, continued
(In thousands)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
1995 1994
------- -------
<S> <C> <C>
Reconciliation of net earnings to net cash
from operating activities:
Net earnings $1,196 568
Adjustments to reconcile net earnings to
net cash from operating activities:
Depreciation and amortization 299 212
Minority interest in consolidated earnin --- 15
Undistributed earnings of affiliate (1,082) (743)
Gain on sale of fixed assets (4) ---
Gain on sale of securities (34) ---
Change in federal income tax payable 210 (485)
Provision for deferred tax asset (111) 668
Change in trading securities (143) 392
Provision to decrease valuation allowance
on marketable securities --- 68
Change in payable to clearing broker 351 17
Change in management fees & other receiv 1,253 387
Change in prepaids & other current asset 453 (333)
Change in other assets 27 (7)
Change in unrealized holding gain 10 (14)
Change in trade payables (585) 195
Change in accrued expenses & other liabi 639 (385)
------- -------
Net cash from operating activities $2,479 555
======= =======
</TABLE>
Summary of non-cash transactions:
At January 1, 1994, the Company began recording marketable securities at fair
value, with unrealized holding gains and losses (net of tax) reported as a
separate component of shareholders' equity, Statement of Financial Accounting
Standards #115. The effect of this resulted in an increase to unrealized holding
gains of $3.2, and increase to deferred tax assets of $7.2 and a decrease to
marketable securities of $4.0 for the nine months ended September 30, 1995.
During the third quarter, 1995, the investment in the Company by the Company's
affiliate, Prime Medical Services, Inc., became immaterial. Consequently,
Reciprocal Stockholdings fell to zero while the COmpany's investment in
affiliate increased by $543.
See accompanying notes to consolidated financial statements
-7-
<PAGE>
AMERICAN PHYSICIANS SERVICE GROUP, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1995
(Unaudited)
1. General
-------
The accompanying unaudited consolidated financial statements have been
prepared in conformity with the accounting principles stated in the audited
financial statements for the year ended December 31, 1994 and reflect all
adjustments which are, in the opinion of management, necessary for a fair
statement of the financial position as of September 30, 1995 and the results of
operations for the periods presented. These statements have not been audited or
reviewed by the Company's independent certified public accountants. The
operating results for the interim periods are not necessarily indicative of
results for the full fiscal year.
The notes to consolidated financial statements appearing in the Company's Annual
Report on Form 10-KSB for the year ended December 31, 1994 filed with the
Securities Exchange Commission should be read in conjunction with this Quarterly
Report on Form 10-QSB. There have been no significant changes in the information
reported in those notes other than from normal business activities of the
Company.
Certain reclassifications have been made to amounts presented in prior periods
to be consistent with the 1995 presentation.
2. Marketable Securities
---------------------
Marketable securities include equity securities and investments in bonds that
are intended to be held less than one year. At January 1, 1994, the Company
began recording these securities at fair value, with unrealized holding gains
and losses reported as a separate component of shareholders' equity, per
SFAS-115.
3. Contingencies
-------------
In conjunction with a settlement agreement, the Company's broker/dealer
subsidiary, APS Financial, has guaranteed the future yield of a customer's
investment portfolio beginning in November 1994 for up to a five and one-half
year period. Through September 30, 1995 APS Financial has accrued $293,000 in
contingent liabilities to cover potential portfolio deficiencies.
-8-
<PAGE>
4. Equity in Earnings of Unconsolidated Affiliate
----------------------------------------------
At September 30, 1995 the Company owned 21% (3,064,000 shares) of the
outstanding common stock of Prime Medical Services, Inc. ("Prime"). The Company
had granted to a third party the right to purchase 237,500 of such shares at
$1.25 per share. These options were exercised September 9, 1995. The Company
records its pro-rata share of Prime's results on the equity basis. Prime is
in the business of providing lithotripsy services. The common stock of Prime is
traded in the over-the-counter market under the symbol "PMSI". Prime is a
Delaware corporation which is required to file annual, quarterly and other
reports and documents with the Securities and Exchange Commission, which reports
and documents contain financial and other information regarding Prime. Such
reports and documents may be examined and copies may be obtained from the
offices of the Securities and Exchange Commission.
5. Acquisitions and Divestitures
-----------------------------
Effective October 22, 1995 the Company's publications subsidiary, APS
Communications Corporation, ("APS Communications") sold substantially all of its
assets to Alliance Media, Inc. ("Alliance"). The assets included in the sale
consisted of: the seller's rights to publish the Spanish Yellow Pages for Mexico
directory; all accounts receivable for the unpublished 1996 Spanish Yellow Page
directory; certain fixed assets and all software necessary to conduct normal
business. Alliance is a Nashville based publisher of yellow page directories in
Tennessee, Kentucky, Ohio and Texas. The sale will have no material financial
impact on 1995 earnings.
-9-
<PAGE>
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
- ---------------------
REVENUES
- --------
Revenues from operations increased $119,000 (2.8%) and $2,271,000
(18.8%) for the three and nine month periods ended September 30, 1995,
respectively, compared to the same periods in 1994. Computer systems and real
estate increased while financial services, publications and investments and
other decreased during the third quarter of 1995 compared to the same period in
1994. For the nine month period ended September 30, 1995, all segments of
operations increased compared to the same period in 1994.
Financial services revenues decreased $209,000 (7.3%) but increased
$976,000 (12.7%) for the three and nine month periods ended September 30, 1995,
respectively, compared to the same periods in 1994. The third quarter decrease
in 1995 was primarily due to lower broker/dealer commissions, offset partially
by a recovery of prior year losses in high yield bonds held in inventory.
Broker/dealer commissions were down primarily due to the loss of an
experienced, high volume broker. Revenues from premium-based insurance
management fees were up (8.4%) for the first nine months of 1995 compared to
the same period in 1994, due primarily to the addition of new large-group
clients in the 2nd quarter of 1995.
Computer systems and software sales revenues increased $334,000 (30.1%)
and $199,000 (5.5%) for the three and nine month periods ended September 30,
1995, respectively, compared to the same periods in 1994. The third quarter
increase was primarily due to hardware upgrade sales as well as to higher
software license revenue, a result of several contracts nearing completion. The
majority of the software license revenue from contracts signed in 1994 became
recognizable in 1995.
The sales backlog for non-recurring revenues (such as hardware sales,
software license and training revenues) was $404,000 at September 30, 1995
compared to $1,035,000 at September 30, 1994. Moreover, the current backlog is
expected to be substantially complete by fiscal year end. Contracts for
recurring revenues, 48% and 45% of total revenue in 1995 and 1994,
respectively, were approximately the same at September 30, 1995 and 1994.
-10-
<PAGE>
Publications revenues for the three and nine month periods ended
September 30, 1995, were zero and $757,000 compared to zero for the same two
periods in 1994. This variance is due to a difference in the distribution dates
of the Spanish Yellow Page Directory. The Company recognizes revenues upon
distribution of its directories. Distribution of the 1993 directory was in late
1993 while distribution of the 1994 directory was early in 1995; consequently,
no revenue was recognized in 1994. As discussed in Note 5 of the Notes to the
Condensed Consolidated Financial Statements, APS Communications Corporation
sold a majority of its assets on October 22, 1995. The publications segment
lost $200,000, $385,000 and $85,000 in 1994, 1993 and 1992, respectively.
Real estate revenues rose $17,000 (11.2%) and $79,000 (18.9%) for the
three and nine month periods ended September 30, 1995, respectively, compared
to the same periods in 1994. The increase in both periods was due to achieving
full occupancy and also due to rising lease rates. Given the current economic
good health of the Austin real estate market, it is reasonable to expect rental
and occupancy rates to remain favorable into 1996.
Investment and other income decreased $22,000 (16.9%) but increased
$259,000 (69.9%) for the three and nine month periods ended September 30, 1995,
respectively, compared to the same periods in 1994. The nine month positive
variance is primarily due to reimbursements received in 1995 for the settlement
of the Texas Hospital Insurance Exchange ("THIE") lawsuit described in the 1994
Form 10-KSB. The Company has filed a lawsuit against THIE to recover additional
costs related to defending the original THIE lawsuit.
EXPENSES
- --------
Total expenses decreased $17,000 (0.4%) but increased $1,734,000 (14.5%)
for the three and nine month periods ended September 30, 1995, respectively,
when compared to the same periods in 1994. Computer systems, publications, real
estate and investment & other increased while financial services showed a
decrease for the three month period. For the nine month period, publications,
real estate and investment & other increased while financial services and
computer systems decreased.
Financial services expense decreased $579,000 (20.4%) and $17,000 (0.2%)
for the three and nine month periods. The decrease in the third quarter of 1995
was primarily the result of lower commissions paid in broker/dealer operations
arising from the lower commission revenues. Reduced general and administrative
expenses within the broker/dealer subsidiary have also contributed to the
decrease for the nine month period in 1995 compared to 1994. Expenses at the
insurance management subsidiary were also down for the nine month periods ended
September 30, 1995 compared to the same periods in 1994, due to legal costs
incurred in defending a lawsuit during 1994. The suit has since been settled
with no material charges affecting 1995.
-11-
<PAGE>
Computer systems/software expense increased $100,000 (9.0%) but
decreased $114,000 (3.4%) for the three and nine month periods ended September
30, 1995, respectively, compared to the same periods in 1994. The third quarter,
1995, increase is due to higher hardware cost of sales, resulting directly from
the aforementioned increase in hardware sales revenue. In addition, an increase
in personnel costs resulting from staff increases associated with installing and
servicing new contracts contributed to the three month increase and partially
offset the nine month decrease. Hardware sales for the first nine months of 1995
are still below those of the same period of 1994. This accounts for the overall
decrease in 1995 expenses.
Publications expense increased $255,000 (1,274.8%) and $1,074,000
(636.5%) for the three and nine month periods ended September 30, 1995,
respectively, compared to the same periods in 1994. The delay in distributing
the 1994 directory until April, 1995 caused both revenues and expenses to be
recognized in the second quarter of 1995. Expenses from the prior directory
were recognized in the fourth quarter of 1993, since that directory was
distributed in December 1993. This timing difference is the reason for the
large nine month expense variance. As for the three month comparative periods,
the increase in 1995 was due to not capitalizing production costs in 1995 as
was done in 1994. Being that APS Communications was to be sold in October,
1995, costs which had been previously capitalized were charged to expense,
since there would be no need to match costs with future revenues.
Real estate expense increased $13,000 (12.0%) and $42,000 (12.8%) for
the three and nine month periods ended September 30, 1995, respectively,
compared to the same periods in 1994. The increase in both periods is primarily
attributable to higher utilities as well as to higher property taxes, caused by
appreciation in the taxable value of the building operated by the Company.
General and administrative expense increased $207,000 (1654.0%) and
$766,000 (139.6%) during for the three and nine month periods ended September
30, 1995, respectively, compared to the same periods in 1994. The increase for
the nine month period was due primarily to accruals made for certain contingent
liabilities associated with ongoing litigation. For the three month period, a
large accrual for legal contingencies was reversed in 1994. The third quarter
of 1995 had no such reversal which accounts for the 1995 increase. Absent these
contingent liabilities, general and administrative expenses have been stable
for both periods.
Interest expense decreased $14,000 (43.4%) and $18,000 (14.5%) for the
three and nine month periods ended September 30, 1995, respectively, compared
to the same periods in 1994. Both period decreases were due to a lower volume
of securities held in inventory at the broker/dealer subsidiary for resale to
clients. A lower inventory requires a lower level of securities purchased on
margin which corresponds to lower interest charged.
-12-
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
- -------------------------------
Current assets exceeded current liabilities by $6,968,000 and $6,086,000
at September 30, 1995, and December 31, 1994, respectively. The increase is
primarily attributable to cash received on a long term note receivable, as well
as reimbursement received for certain litigation related expenses.
To further its ability to meet its liquidity requirements, the Company
has established a $2,000,000 revolving line of credit with a bank. The loan is
renewable annually and bears interest at the bank's prime rate. The loan is
secured by accounts receivable and is guaranteed by APS Facilities Management,
Inc. and APS Systems, Inc., two subsidiaries of the Company. The Company plans
to use this line of credit to supplement its working capital. No funds were
advanced under this line at September 30, 1995.
Capital expenditures through the quarter ended September 30, 1995 were
approximately $406,000 and total capital expenditures are expected to be
approximately $425,000 in 1995.
Management believes that its working capital position together with
funds generated from operations and from available lines of credit will provide
sufficient resources to meet all present and reasonably foreseeable and capital
needs.
-13-
<PAGE>
PART II
OTHER INFORMATION
-14-
<PAGE>
Item 1. Legal Proceedings
-----------------
The Company is involved in various claims and legal actions that have
arisen in the ordinary course of business. The Company believes that the
liability provision in its financial statements is sufficient to cover
any unfavorable outcome related to lawsuits in which it is currently
named. Management believes that liabilities, if any, arising from these
actions will not have a significant adverse effect on the financial
condition of the Company. However, due to the uncertain nature of legal
proceedings, the actual outcome of these lawsuits may differ from the
liability provision recorded in the Company's financial statements.
Item 5. Other Information
-----------------
On August 17, 1995, the Company's unconsolidated affiliate, Prime
Medical Services, Inc., ("Prime") received an additional commitment of
$10,000,000 bringing the total revolving line of credit from the First
National Bank of Boston and NationsBank of Texas, N.A. to $25,000,000.
The line will be for a term of forty-two months with a fluctuating interest
rate (currently 7.5%)based upon LIBOR. As of October 31, 1995, a total of
$4,750,000 has been drawn against the line.
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibits
11 Computation of Net Income Per Share at September 30, 1995
and 1994.
(b) Current reports on Form 8-K.
No current reports on Form 8-K were filed during the quarter
ended September 30, 1995.
-15-
<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.
AMERICAN PHYSICIANS SERVICE GROUP, INC.
Date: November 13, 1995 By: /s/ William H. Hayes
---------------------------------
William H. Hayes, Vice President
and Chief Financial Officer
-16-
<PAGE>
EXHIBIT 11
AMERICAN PHYSICIANS SERVICE GROUP, INC.
COMPUTATION OF NET INCOME PER SHARE
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
<TABLE>
<CAPTION>
(In thousands, except earnings per share) Primary Fully Diluted
Earnings Earnings
Per Share Per Share
---------- -------------
<S> <C> <C>
1995
Net Income applicable to common stock $ 538 538
Average number of shares outstanding 3,500 3,500
Average stock option shares 360 425
-------- --------
Shares for earnings calculation 3,860 3,925
Net income per share $0.14 0.14
======== ========
1994
Net Income applicable to common stock $ 287 287
Average number of shares outstanding 3,297 3,297
Average stock option shares 226 226
-------- --------
Shares for earnings calculation 3,523 3,523
Net income per share $0.08 0.08
======== ========
</TABLE>
NOTE:
Primary and fully diluted income per share were computed by dividing
net income by the average number of shares outstanding plus the common
stock equivalents which, would arise from the exercise of dilutive stock
options.
-17-
<PAGE>
EXHIBIT 11
AMERICAN PHYSICIANS SERVICE GROUP, INC.
COMPUTATION OF NET INCOME PER SHARE
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
<TABLE>
<CAPTION>
(In thousands, except earnings per share) Primary Fully Diluted
Earnings Earnings
Per Share Per Share
---------- -------------
<S> <C> <C>
1995
Net Income applicable to common stock $1,196 1,196
Average number of shares outstanding 3,423 3,423
Average stock option shares 299 425
------- -------
Shares for earnings calculation 3,722 3,848
Net income per share $0.32 0.31
======= =======
1994
Net Income applicable to common stock $568 568
Average number of shares outstanding 3,296 3,296
Average stock option shares 220 220
------- -------
Shares for earnings calculation 3,516 3,516
Net income per share $0.16 0.16
======= =======
</TABLE>
NOTE:
Primary and fully diluted income per share were computed by dividing
net income by the average number of shares outstanding plus the common
stock equivalents which would arise from the exercise of dilutive stock options.
-18-
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM SEPTEMBER
30, 1995 FORM 10QSB AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C> <C>
<PERIOD-TYPE> 3-MOS 9-MOS
<FISCAL-YEAR-END> DEC-31-1995 DEC-31-1995
<PERIOD-START> JUL-01-1995 JAN-01-1995
<PERIOD-END> SEP-30-1995 SEP-30-1995
<CASH> 0 7,393
<SECURITIES> 0 1,323
<RECEIVABLES> 0 1,760
<ALLOWANCES> 0 0
<INVENTORY> 0 18
<CURRENT-ASSETS> 0 11,243
<PP&E> 0 5,304
<DEPRECIATION> 0 3,135
<TOTAL-ASSETS> 0 21,588
<CURRENT-LIABILITIES> 0 4,275
<BONDS> 0 0
<COMMON> 0 363
0 0
0 0
<OTHER-SE> 0 16,739
<TOTAL-LIABILITY-AND-EQUITY> 0 21,588
<SALES> 3,915 13,260
<TOTAL-REVENUES> 4,370 14,386
<CGS> 565 1,338
<TOTAL-COSTS> 3,239 10,398
<OTHER-EXPENSES> 248 1,886
<LOSS-PROVISION> 0 0
<INTEREST-EXPENSE> 62 108
<INCOME-PRETAX> 734 1,738
<INCOME-TAX> 196 542
<INCOME-CONTINUING> 538 1,196
<DISCONTINUED> 0 0
<EXTRAORDINARY> 0 0
<CHANGES> 0 0
<NET-INCOME> 538 1,196
<EPS-PRIMARY> 0.14 0.32
<EPS-DILUTED> 0.14 0.31
</TABLE>
