<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended October 31, 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 0-12226
CALIFORNIA BEACH RESTAURANTS, INC.
(Exact name of Registrant as specified in its charter)
<TABLE>
<S> <C>
CALIFORNIA 95-2693503
(State or other jurisdiction of incorporation or organization) (IRS Employer Identification Number)
</TABLE>
17383 Sunset Boulevard, Suite 140, Pacific Palisades, CA 90272
(Address and zip code of Principal executive offices)
(310) 459-9676
(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 the
filing requirements for at least 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:
<TABLE>
<S> <C>
Number of Shares Outstanding
Class at December 1, 1995
----- ----------------------------
Common Stock, $.01 par value 3,400,975
</TABLE>
<PAGE> 2
CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES
OCTOBER 31, 1995
INDEX
<TABLE>
<CAPTION>
Part I - FINANCIAL INFORMATION Page Number
-----------
<S> <C>
Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheets at October 31, 1995
and April 30, 1995 . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Consolidated Statements of Operations for the
Three Months Ended, and Six Months Ended
October 31, 1995 and 1994 . . . . . . . . . . . . . . . . . . . . . . . 5
Consolidated Statements of Cash Flows for the
Six Months Ended October 31, 1995 and 1994 . . . . . . . . . . . . . . 6
Notes to Consolidated Financial Statements . . . . . . . . . . . . . . 7
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations . . . . . . . . . . . . . . . . . . 9
Part II - OTHER INFORMATION
Item 1. Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Item 2. Changes in Securities . . . . . . . . . . . . . . . . . . . . . . . 12
Item 3. Defaults Upon Senior Securities . . . . . . . . . . . . . . . . . . . 12
Item 4. Submission of Matters to a Vote of Security Holders . . . . . . . . . 12
Item 5. Other Information . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Item 6. Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . . . . . 12
Signature Page . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
</TABLE>
2
<PAGE> 3
CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
<TABLE>
<CAPTION>
October 31, 1995 April 30, 1995
---------------- --------------
(Unaudited) (1)
<S> <C> <C>
Current Assets:
Cash $ 687,000 $ 493,000
Restricted cash 500,000 500,000
Trade and other receivables 47,000 22,000
Inventories 290,000 262,000
Prepaid expenses 216,000 155,000
--------- ---------
Total current assets 1,740,000 1,432,000
Fixed Assets (at cost) - net of accumulated
depreciation and amortization (Note C ) 1,466,000 1,562,000
Other Assets:
Goodwill, net of accumulated
amortization 3,239,000 3,568,000
Other 158,000 147,000
---------- -----------
$6,603,000 $6,709,000
========== ==========
</TABLE>
The accompanying notes to consolidated financial statements are an integral
part of this statement.
(1) The April 30, 1995 amounts have been extracted from the Company's Annual
Report on Form 10-K for the year ended April 30, 1995.
3
<PAGE> 4
CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
<TABLE>
<CAPTION>
October 31, 1995 April 30, 1995
---------------- --------------
(Unaudited) (1)
<S> <C> <C>
Current Liabilities:
Accounts payable $ 825,000 $ 665,000
Accrued interest - 27,000
Accrued liabilities 600,000 656,000
Current portion of long-term debt (Note D) 1,216,000 1,161,000
----------- -----------
Total current liabilities 2,641,000 2,509,000
Long-term debt, less current portion (Note D) 2,011,000 2,776,000
9.75% convertible subordinated notes (Note E) - 783,000
Stockholders Equity (Note E):
Common stock, $.01 par value, authorized
25,000,000 shares, issued and outstanding,
3,400,975 shares at October 31, 1995 and
280,000 shares at April 30, 1995 34,000 3,000
Series A convertible preferred stock, no par
value, authorized 5,000,000 shares, issued
and outstanding, none at October 31, 1995
and 2,223,556 shares at April 30, 1995 - 1,694,000
Additional paid-in capital 13,175,000 10,853,000
Accumulated deficit (11,258,000) (11,909,000)
----------- -----------
Total stockholders' equity 1,951,000 641,000
----------- -----------
$6,603,000 $6,709,000
========== ==========
</TABLE>
The accompanying notes to consolidated financial statements are an integral
part of this statement.
(1) The April 30, 1995 amounts have been extracted from the Company's Annual
Report on Form 10-K for the year ended April 30, 1995.
4
<PAGE> 5
CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
October 31, October 31,
--------------------------- --------------------------
1995 1994 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>
Sales $3,918,000 $3,812,000 $7,661,000 $7,566,000
Costs and Expenses:
Cost of goods sold 3,000,000 3,002,000 5,904,000 6,058,000
Selling, general and administrative 217,000 210,000 445,000 420,000
Legal and litigation settlement 42,000 89,000 96,000 134,000
Depreciation 100,000 106,000 199,000 203,000
---------- ---------- ---------- ----------
559,000 405,000 1,017,000 751,000
Other income (expenses):
Interest expense (26,000) (245,000) (42,000) (470,000)
Amortization of intangible assets (165,000) (257,000) (330,000) (515,000)
Other, net 8,000 8,000 12,000 12,000
---------- ---------- ---------- ----------
Income (loss) before income taxes 376,000 (89,000) 657,000 (222,000)
Provision for income taxes 4,000 1,000 6,000 2,000
---------- ---------- ---------- ----------
Net Income (loss) $372,000 ($90,000) $651,000 ($224,000)
========== ========== ========== ==========
Net Income (loss) per common
share (Note F):
Primary $ .15 ($ .32) $ .26 ($ .80)
========== ========== ========== ==========
Fully-diluted $ .12 ($ .32) $ .20 ($ .80)
========== ========== ========== ==========
Weighted average number of
common shares outstanding:
Primary 2,471,000 280,000 2,466,000 280,000
========= ======= ========= =======
Fully-diluted 3,400,000 280,000 3,400,000 280,000
========= ======= ========= =======
</TABLE>
The accompanying notes to consolidated financial statements are an integral
part of this statement.
5
<PAGE> 6
CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED OCTOBER 31,
(UNAUDITED)
<TABLE>
<CAPTION>
1995 1994
---------- ----------
<S> <C> <C>
Cash flows from operating activities:
Net Income (loss) $ 651,000 ($224,000)
Adjustments to reconcile net income
(loss) to cash provided by operations:
Depreciation and amortization 529,000 718,000
Deferred loan fees - 39,000
Changes in operating assets and liabilities:
Trade and other receivables (25,000) (38,000)
Inventories (28,000) (13,000)
Prepaid expenses (61,000) (1,000)
Accounts payable 160,000 56,000
Accrued interest (27,000) 429,000
Accrued liabilities (56,000) (225,000)
---------- ----------
Cash provided by operations 1,143,000 741,000
---------- ----------
Cash flows used in investing activities:
Additions to fixed assets (83,000) (213,000)
Increase in other assets (11,000) -
---------- ----------
Net cash used in investing activities (94,000) (213,000)
---------- ----------
Cash flows from financing activities:
Net proceeds from Rights Offering 79,000 -
Redemption of 9.75% convertible
subordinated notes (203,000) -
Principal payments on borrowings (731,000) (7,000)
---------- ----------
Net cash used in financing activities (855,000) (7,000)
---------- ----------
Net increase in cash 194,000 521,000
Cash at beginning of period 493,000 774,000
---------- ----------
Cash at end of period $ 687,000 $1,295,000
========== ==========
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest $ 65,000 $ -
========== ==========
Income taxes $ 2,000 $ 4,000
========== ==========
</TABLE>
During 1995 the Company incurred a capital lease obligation of $21,000 in
connection with a lease agreement to acquire equipment.
The accompanying notes to consolidated financial statements are an integral
part of this statement
6
<PAGE> 7
CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE A - BASIS OF PRESENTATION
The unaudited consolidated financial statements presented herein include the
accounts of California Beach Restaurants, Inc., and its wholly-owned
subsidiaries (the "Company"). All significant intercompany accounts and
transactions have been eliminated.
The unaudited consolidated financial statements presented herein have been
prepared in accordance with generally accepted accounting principles and the
instructions to Form 10-Q and article 10 of Regulation S-X and do not include
all of the information and footnote disclosures required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, the accompanying financial statements include all adjustments
(consisting of normal recurring accruals) necessary for a fair presentation of
the Company's financial position and results of operations. The results of
operations for the six month period ended October 31, 1995 may not be
indicative of the results that may be expected for the year ending April 30,
1996. These statements should be read in conjunction with the financial
statements and notes thereto included in the Company's Form 10-K for the
year-ended April 30, 1995.
NOTE B - ACCOUNTING PERIODS
The Company's restaurant operations are conducted through its wholly-owned
subsidiary, Sea View. The Company's consolidated financial statements for the
three months and six months ended October 31, 1995 and 1994 include Sea View's
operations for the twelve weeks and twenty-four weeks ended October 12, 1995
and October 13, 1994, respectively.
NOTE C - FIXED ASSETS
<TABLE>
<CAPTION>
October 31, 1995 April 30, 1995
---------------- --------------
<S> <C> <C>
Leasehold improvements $2,630,000 $2,606,000
Furniture and equipment 765,000 725,000
---------- ----------
3,395,000 3,331,000
Less accumulated depreciation and amortization (1,929,000) (1,769,000)
---------- ----------
$1,466,000 $1,562,000
========== ==========
</TABLE>
7
<PAGE> 8
CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
(UNAUDITED)
NOTE D - LONG-TERM DEBT
On December 22, 1994 Sea View completed a restructuring of its bank debt and
entered into an Amended and Restated Loan Agreement ("Amended Loan"). The
Amended Loan included a senior secured note in the principal amount of
$3,000,000, bearing interest at 12% per annum, and payable at varying monthly
amounts through October 31, 1997, and a junior secured note in the amount of
$400,000 accruing interest at 12% per annum with both interest and principal
payable in a single lump sum on October 31, 1997. Interest to maturity on the
senior secured and junior secured notes is included in the carrying value of
such notes, in accordance with Financial Accounting Standards Board Statement
No. 15, "Accounting by Debtors and Creditors for Troubled Debt Restructuring,"
and will not be recognized as interest expense in current and future years. At
October 31, 1995 the balance of the senior secured note was $2,652,000,
including $348,000 of future interest costs, while the balance on the junior
secured note was $557,000, including $116,000 of future interest costs.
NOTE E - RIGHTS OFFERING
On October 18, 1995 the Company completed a Rights Offering to certain
shareholders that did not participate in the December 22, 1994 private
placement. Eligble shareholders as of September 11, 1995 received 4.7215
rights for each share of stock that they owned. Each right entitled the holder
to purchase one share of common stock at $.83 per share. The proceeds of the
offering were used to partially redeem the Company's outstanding 9.75%
convertible subordinated notes which, if not redeemed, were scheduled to
convert into common stock as of October 30, 1995.
The Company raised approximately $203,000 from the exercise of 244,020 rights.
The proceeds from the Rights Offering were distributed to the holders of the
9.75% convertible subordinated notes on a pro-rata basis. The unredeemed
portion of the notes converted into 696,207 shares of common stock. Expenses
of the Rights Offering, which were paid by the Company, approximated $124,000.
NOTE F - EARNINGS PER SHARE
Primary earnings per common share are calculated by dividing net earnings
applicable to common stock by the average of common stock outstanding and
common stock equivalents. On a fully-diluted basis, both net earnings and
shares outstanding are adjusted to assume the conversion of the 9.75%
convertible subordinated notes as of May 1, 1995.
8
<PAGE> 9
CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
RESULTS OF OPERATIONS
RESTAURANT REVENUES
Total sales for the three months ended October 31, 1995 were $3,918,000
compared with $3,812,000 for the same period last year, an increase of $106,000
or 2.8%.
The Registrant's Gladstone's 4 Fish restaurant is located on the beach in
Pacific Palisades, California and is dependent, to a certain extent, on
favorable weather and tourism. Sales for the three months ended October 31,
1995 benefited from improved tourism in the Los Angeles area as well as very
favorable weather.
Sales for the six months ended October 31, 1995 were $7,661,000 compared with
$7,566,000 for the same period last year, an increase of $95,000 or 1.3%.
Sales during the first quarter ended July 31, 1995 decreased .3% compared to
the same period in the previous year due, in part, to unfavorable weather
during May and June.
As a result of typically more favorable weather and high tourism during the
summer months from May through September the Registrant's sales and operating
profits have historically been higher in the first and second quarters of its
fiscal year.
COST OF GOODS SOLD
Cost of goods sold includes all food, beverages, liquor, direct labor and other
operating expenses of the Registrant's restaurant operations.
Cost of goods sold for the three months ended October 31, 1995 was $3,000,000,
or, as a percentage of sales, 76.6% compared with $3,002,000, or, as a
percentage of sales, 78.8% during the same period last year. This improvement
is primarily due to lower labor costs resulting from a more efficient use of
restaurant staff as well as significantly lower rates on workers compensation
insurance. The reduction in workers compensation insurance should result in
lower labor costs through March 31, 1996, the end of the current policy year.
Cost of goods sold for the six months ended October 31, 1995 was $5,904,000,
or, as a percentage of sales, 77.1% compared with $6,058,000, or, as a
percentage of sales, 80.1% during the same period last year. This improvement
is also primarily due to lower labor costs. In addition, in the comparable
period last year the Registrant incurred expenses related to a July 4th
fireworks show and non-recurring expenses due to the implementation of a new
menu and service approach for Gladstone's outdoor dining area.
Cost of goods sold will typically be slightly lower during the first and second
quarters due to additional economies of scale that can be achieved with labor
and certain other costs when sales levels are higher. For the fiscal year
ended April 30, 1995, cost of goods sold, as a percentage of sales, was 82.9%.
9
<PAGE> 10
CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
For the three months ended October 31, 1995, selling, general and
administrative expenses were $217,000 compared with $210,000 for the same
period last year, an increase of $7,000 or 3.3%.
For the six months ended October 31, 1995, selling, general and administrative
expenses were $445,000 compared with $420,000 for the same period last year, an
increase of $25,000 or 6.0%. This increase is primarily due to expenses
incurred in connection with the Registrant's reverse stock split which became
effective May 1, 1995, as well as an increase in certain compensation related
expenses.
LEGAL AND LITIGATION SETTLEMENT
For the three months ended October 31, 1995, legal and litigation settlement
expenses were $42,000 compared with $89,000 for the same period last year, a
decrease of $47,000 or 52.8%. This decrease is due to the completion of
various financial restructuring transactions during the Registrant's prior
fiscal year.
For the six months ended October 31, 1995, legal and litigation settlement
expenses were $96,000 compared with $134,000 for the same period last year, a
decrease of $38,000 or 28.4%.
The Registrant will incur legal expenses during the balance of its current
fiscal year ending April 30, 1996 to register common stock owned by certain
stockholders pursuant to a contractual obligation as well as expenses related
to defending a lawsuit brought by a former employee of the Registrant (See Part
II - Item 1. - Legal Proceedings).
INTEREST EXPENSE
For the three months and six months ended October 31, 1995 the Registrant
incurred interest expense of $26,000 and $42,000, respectively, primarily
related to the 9.75% convertible subordinated notes. These notes were
partially redeemed by the Registrant in October 1995 and the unredeemed portion
of the notes converted into common stock as of October 30, 1995. The
Registrant does not expect to incur any significant interest expense through
the end of its current fiscal year.
For the three months and six months ended October 31, 1994 the Registrant
incurred interest expense of $245,000 and $470,000, respectively, related to
the term loan which was borrowed to fund the acquisition of the Registrant's
restaurant operations. On December 22, 1994 the Registrant entered into an
Amended and Restated Loan Agreement ("Amended Loan"). Interest to maturity on
the Amended Loan has been included in the carrying value of such debt, in
accordance with Financial Accounting Standards Board Statement No. 15,
"Accounting by Debtors and Creditors for Troubled Debt Restructuring" and will
not be recognized as interest expense in current and future years.
AMORTIZATION OF INTANGIBLE ASSETS
For the three months and six months ended October 31, 1995 amortization expense
was $165,000 and $330,000, respectively, compared with $257,000 and $515,000
for the same periods last year. These decreases are due to the Registrant's
covenant not to compete becoming fully amortized as of April 30, 1995.
Amortization expense now relates completely to the Registrant's Goodwill and
will approximate $714,000 per year.
10
<PAGE> 11
CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES
LIQUIDITY AND CAPITAL RESOURCES
On December 22, 1994 the Registrant completed a restructuring of Sea View's
existing bank debt and settlement of a contingent subordinated note. The
Registrant concurrently closed a private placement of securities to finance
such restructuring and settlement. The private financing which raised the
funds necessary to effect the bank debt restructuring and contingent note
settlement, involved a total investment of $1,600,000, excluding expenses,
consisting of $817,290 of Series A convertible preferred stock and $782,710 of
9.75% convertible subordinated notes.
The Registrant held an annual meeting of shareholders on April 28, 1995. At
this meeting the shareholders approved a one for 33.286962 reverse stock split
of the Registrant's common stock. The reverse stock split became effective on
May 1, 1995 upon the filing of a Certificate of Amendment to the Articles of
Incorporation of the Registrant. As a result of the reverse stock split, the
Series A convertible preferred stock automatically converted into 2,180,748
shares of common stock on May 1, 1995.
On October 18, 1995 the Registrant completed a Rights Offering to certain
shareholders that did not participate in the December 22, 1994 private
placement. Eligible shareholders as of September 11, 1995 received 4.7215
rights for each share of common stock that they owned. Each right entitled the
holder to purchase one share of common stock at $.83 per share. The proceeds
of the offering were used to partially redeem the Registrant's 9.75%
convertible subordinated notes which, if not redeemed, were scheduled to
convert into common stock as of October 30, 1995.
The Registrant raised $202,537 from the exercise of 244,020 rights. The
proceeds from the offering were distributed to the holders of the 9.75%
convertible subordinated notes on a pro-rata basis. The unredeemed portion of
the notes converted into 696,207 shares of common stock. Expenses of the
offering, which were paid by the Registrant, approximated $124,000.
The Registrant currently has no outside sources of short-term or long-term
financing. Although the Registrant remains highly leveraged after the
completion of the bank debt restructuring, due primarily to the repayment terms
of the remaining loan principal, the Registrant believes that its existing cash
and cash flow from operations over the next year will allow it to meet its debt
obligations under the Amended Loan as well as its normal operating expenses.
Capital expenditures through October 31, 1995 totaled approximately $104,000.
The Registrant estimates that capital requirements for fiscal 1996 will be
approximately $200,000.
11
<PAGE> 12
CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES
PART II
OTHER INFORMATION
Item 1. Legal Proceedings.
In September 1994 the Registrant received notice of a complaint
filed in Los Angeles County Superior Court by a former employee
seeking unspecified damages for various causes of action, including
wrongful termination. The Registrant has filed an answer to the
complaint denying any liability. The Registrant believes that this
claim is without merit and intends to defend this action vigorously.
The matter is currently scheduled for trial on April 1, 1996.
Item 2. Changes in Securities.
Not applicable.
Item 3. Defaults Upon Senior Securities.
None
Item 4. Submission of Matters to a Vote of Security Holders.
Not applicable.
Item 5. Other Information
Not applicable.
Item 6. Exhibits and Reports on Form 8-K.
Exhibits
27 - Financial data schedule
Reports on Form 8-K
None
12
<PAGE> 13
CALIFORNIA BEACH RESTAURANTS, INC. AND SUBSIDIARIES
Signature(s)
Pursuant to the requirements of the Securities Exchange Act of 1934, Registrant
has duly caused this report to be signed on its behalf by the undersigned
thereunto duly authorized.
California Beach Restaurants, Inc. (Registrant)
Dated: December 12, 1995 By: Alan Redhead
--------------------------------------
Alan Redhead
Chief Executive Officer
(Duly Authorized Officer)
By Mark E. Segal
--------------------------------------
Mark E. Segal
Vice President - Finance
and Chief Financial Officer
13
<PAGE> 14
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
ITEM
NUMBER DESCRIPTION METHOD OF FILING
------ -------------- ------------------
<S> <C> <C>
27 Financial data schedule Filed herewith electronically
</TABLE>
14
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S CONSOLIDATED STATEMENTS OF INCOME AND CONSOLIDATED BALANCE SHEETS AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> APR-30-1996
<PERIOD-START> MAY-01-1995
<PERIOD-END> OCT-31-1995
<CASH> 1,187,000
<SECURITIES> 0
<RECEIVABLES> 47,000
<ALLOWANCES> 0
<INVENTORY> 290,000
<CURRENT-ASSETS> 1,740,000
<PP&E> 3,395,000
<DEPRECIATION> (1,929,000)
<TOTAL-ASSETS> 6,603,000
<CURRENT-LIABILITIES> 2,641,000
<BONDS> 0
<COMMON> 34,000
0
0
<OTHER-SE> 1,917,000
<TOTAL-LIABILITY-AND-EQUITY> 6,603,000
<SALES> 7,661,000
<TOTAL-REVENUES> 7,661,000
<CGS> 5,904,000
<TOTAL-COSTS> 6,644,000
<OTHER-EXPENSES> 318,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 42,000
<INCOME-PRETAX> 657,000
<INCOME-TAX> 6,000
<INCOME-CONTINUING> 651,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 651,000
<EPS-PRIMARY> .26
<EPS-DILUTED> .20
</TABLE>
