<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 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 1-9599
---------
LEWIS GALOOB TOYS, INC.
-----------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 94-1716574
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(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
500 Forbes Boulevard, South San Francisco, California 94080
-------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (415) 952-1678
--------------
Former name, former address and former fiscal year,
if changed since last report
Indicate by check 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
----- -----
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents
and reports required to be filed by Section 12, 13, or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
Yes No
----- -----
APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares
outstanding of each of the issuer's classes of common stock, as of the latest
practicable date.
Common stock, par value $.01, 10,077,265 as of September 30, 1995.
<PAGE> 2
LEWIS GALOOB TOYS, INC. AND SUBSIDIARIES
INDEX
<TABLE>
<S> <C>
PART I - FINANCIAL INFORMATION
- --------------------------------
Item 1 Page
- Condensed Consolidated Balance Sheets 1
- Condensed Consolidated Statements of Operations 2
- Condensed Consolidated Statements of Cash Flows 3
- Notes to Condensed Consolidated Financial Statements 4-6
Item 2
- Management's Discussion and Analysis of
Financial Condition and Results of Operations 7-10
PART II - OTHER INFORMATION
- -----------------------------
Item 1
- Legal Proceedings 11
Item 3
- Defaults Upon Senior Securities 11
Item 6
- Exhibits and Reports on Form 8-K 11
SIGNATURE 12
- ---------
</TABLE>
<PAGE> 3
LEWIS GALOOB TOYS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
<TABLE>
<CAPTION>
(Unaudited) (Unaudited) (Audited)
Sept 30 Sept 30 December 31
ASSETS 1995 1994 1994
- ------ ---------- ---------- -----------
<S> <C> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $ 3,758 $ 3,094 $ 2,225
Accounts receivable 65,873 55,050 57,883
Inventories 19,236 14,356 16,824
Tooling and related costs 7,298 5,594 8,379
Prepaid expenses and other assets 11,885 5,907 5,492
-------- ------- --------
TOTAL CURRENT ASSETS 108,050 84,001 90,803
LAND, BUILDING AND EQUIPMENT, NET 8,168 8,428 8,400
OTHER ASSETS 1,126 1,224 1,563
-------- ------- --------
$117,344 $93,653 $100,766
======== ======= ========
LIABILITIES AND SHAREHOLDERS' EQUITY
- ------------------------------------
CURRENT LIABILITIES:
Notes payable $25,312 $5,653 $ 6,971
Accounts payable 18,968 12,569 14,973
Accrued expenses 10,921 17,829 14,939
Income taxes payable 248 562 499
Current portion of long-term debt 214 204 202
-------- ------- --------
TOTAL CURRENT LIABILITIES $55,663 $36,817 $37,584
LONG-TERM DEBT 18,256 18,258 18,414
SHAREHOLDERS' EQUITY:
Preferred stock
Authorized 1,000,000 shares
Issued and outstanding 183,950
shares of $17 Convertible
Exchangeable Preferred Stock
at $200 liquidation value
per share 36,790 36,790 36,790
Common stock, par value $.01 per share
Authorized 50,000,000 shares
Issued and outstanding 10,077,265
shares, 10,104,589 shares and
10,055,089 shares 101 101 101
Additional paid-in capital 31,671 31,726 31,506
Retained earnings (deficit) (24,690) (29,591) (23,182)
Cumulative translation adjustment (447) (448) (447)
-------- -------- --------
TOTAL SHAREHOLDERS' EQUITY 43,425 38,578 44,768
-------- -------- --------
$117,344 $ 93,653 $100,766
======== ======== ========
</TABLE>
The accompanying notes are an integral part of these Consolidated Financial
Statements.
1
<PAGE> 4
LEWIS GALOOB TOYS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
Sept 30 Sept 30
------------------------- ---------------------------
1995 1994 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net revenues $65,518 $50,273 $137,078 $114,227
Costs of products sold 40,369 30,336 89,945 69,017
------- ------- ------- -------
Gross margin $25,149 $19,937 $ 47,133 $45,210
Operating expenses:
Advertising and promotion 8,077 7,267 17,739 19,483
Other selling and administrative 7,640 6,142 22,476 17,468
Research and development 1,729 1,930 6,195 6,470
------- ------- ------- -------
Total operating expenses 17,446 15,339 46,410 43,421
------- ------- ------- -------
Earnings (loss) from operations 7,703 4,598 723 1,789
Net proceeds from Nintendo award 0 0 0 12,124
Interest expense (970) (597) (2,357) (1,730)
Other income (expense), net 104 71 213 308
------- ------- ------- -------
Earnings (loss) before
income taxes 6,837 4,072 (1,421) 12,491
Provision for income taxes 0 163 0 477
------- ------- ------- -------
Net earnings (loss) 6,837 3,909 (1,421) 12,014
Preferred stock dividends
in arrears 781 781 2,345 2,345
------- ------- ------- -------
Net earnings (loss) applicable
to common shares $ 6,056 $ 3,128 $(3,766) $ 9,669
======= ======= ======= =======
Common shares and common share
equivalents outstanding - average 10,373 10,363 10,068 10,047
Net earnings (loss) per common share:
Primary $0.58 $0.30 $(0.37) $0.96
Fully diluted $0.50 $0.29 $(0.37) $0.91
</TABLE>
The accompanying notes are an integral part of these Consolidated Financial
Statements.
2
<PAGE> 5
LEWIS GALOOB TOYS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
<TABLE>
<CAPTION>
(Unaudited)
Nine Months Ended Sept 30
-------------------------
1995 1994
---- ----
<S> <C> <C>
CASH FLOW FROM OPERATING ACTIVITIES:
Net earnings (loss) $(1,422) $12,014
Adjustments to reconcile net earnings
(loss) to net cash provided by (used in)
operating activities:
Depreciation 130 486
Changes in assets and liabilities:
Accounts receivable (7,990) (21,667)
Inventories (2,412) (1,377)
Tooling and related costs 1,081 (574)
Prepaid expenses and other assets (5,956) 1,605
Accounts payable 3,995 1,735
Accrued expenses (4,006) 2,756
Income taxes payable (251) 280
------- -------
Net cash provided by (used in) operating
activities (16,831) (4,742)
-------- -------
CASH FLOW FROM INVESTING ACTIVITIES:
Investment in land, building and
equipment, net 102 (352)
------- -------
Net cash provided by (used in) investing
activities 102 (352)
------- -------
CASH FLOW FROM FINANCING ACTIVITIES:
Net borrowings under notes payable 18,341 5,653
Repayments under long-term debt agreements (158) (146)
Proceeds from issuance of common stock 79 382
Other, net 0 (26)
------- -------
Net cash provided by (used in) financing
activities 18,262 5,863
------- -------
INCREASE (DECREASE) IN CASH AND
CASH EQUIVALENTS 1,533 769
CASH AND CASH EQUIVALENTS AT
BEGINNING OF PERIOD 2,225 2,325
------- -------
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 3,758 $ 3,094
======= =======
</TABLE>
The accompanying notes are an integral part of these Consolidated Financial
Statements.
3
<PAGE> 6
LEWIS GALOOB TOYS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1995
(Unaudited)
NOTE A - CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The condensed consolidated balance sheets as of September 30, 1995 and 1994 and
the condensed consolidated statements of operations for the three and nine
month periods ended September 30, 1995 and 1994 and the condensed consolidated
statements of cash flows for the nine month periods ended September 30, 1995
and 1994 have been prepared by the Company without audit. In the opinion of
management, all adjustments (which include only normal recurring adjustments)
necessary to present fairly the financial position, results of operations and
cash flows for all periods presented have been made.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been omitted. It is suggested that these condensed consolidated financial
statements be read in conjunction with the financial statements and notes
thereto included in the Company's Annual Report on Form 10-K for the year ended
December 31, 1994.
The results of operations for the three and nine month periods ended September
30, 1995 and 1994 may not necessarily be indicative of the operating results
for the full year. Certain amounts in the financial statements have been
reclassified to conform with the current year's presentation.
NOTE B - CREDIT AGREEMENT
The Company was party to a loan and security agreement (the "Loan Agreement")
with Congress Financial Corporation (the "Lender") which made available to the
Company through March 31, 1995 a line of credit up to $30 million. Borrowing
availability was determined by a formula based on accounts receivable. The
interest rate was prime plus 2%.
On March 31, 1995, the Company entered into an amended and restated loan and
security agreement (the "New Agreement") with the Lender. The New Agreement
extends the loan term through March 31, 1997 and provides a line of credit of
$40 million, with a provision to increase the line to $60 million at the option
of the Company. Borrowing availability is determined by a formula based on
both accounts receivable and inventories. The interest rate is prime plus 1%
(1% lower than the rate applicable to the previous Loan Agreement). In
consideration for entering into the New Agreement, the Company paid a $100,000
fee; additional fees will be due if
4
<PAGE> 7
LEWIS GALOOB TOYS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1995
(Unaudited)
the Company exercises its option to increase the line. The Company has also
agreed to pay an unused line fee of 0.25% and certain management fees. The New
Agreement provides that the preferred dividend payments may not be made without
the prior consent of the Lender.
NOTE C - INVENTORIES
(in thousands)
<TABLE>
<CAPTION>
September 30 December 31
------------------ -----------
1995 1994 1994
---- ---- ----
<S> <C> <C> <C>
Finished goods $18,521 $ 11,337 $15,596
Raw materials and parts 715 3,019 1,228
------- ------ ------
$19,236 $14,356 $16,824
------- ------- -------
</TABLE>
NOTE D - INCOME TAXES
At December 31, 1994, the Company had federal and California net operating loss
carryforwards for income tax purposes of approximately $11,500,000 and
$1,000,000, respectively. The federal and California carryforwards expire in
different years through the year 2008 and 1998, respectively. The Company also
has federal minimum tax credit carryforwards of $944,000 that are allowed to be
carried forward indefinitely and federal research and development credits of
$765,000, which will expire in different years through the year 2003. If
certain substantial changes in the Company's ownership should occur, there
would be an annual limitation on the amount of operating loss carryforwards
which can be utilized. The Company expects to utilize a substantial amount of
its net operating loss carryforwards by 1996.
No domestic deferred taxes have been provided on undistributed earnings of the
Company's foreign subsidiary. All such earnings are expected to be reinvested
in the subsidiary. Undistributed earnings were approximately $5,500,000 as of
December 31, 1994. No foreign taxes will be withheld on the distribution of
the untaxed earnings.
5
<PAGE> 8
LEWIS GALOOB TOYS, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1995
(Unaudited)
NOTE E - LEGAL PROCEEDINGS
The current status of litigation is described in Part II, Item 1, herein.
6
<PAGE> 9
LEWIS GALOOB TOYS, INC. AND SUBSIDIARIES
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Results of Operations
The following table sets forth for the periods indicated the percentage
relationships between revenues and certain expense and earnings items:
<TABLE>
<CAPTION>
Percentage of Net Revenues
--------------------------
Three Nine
Months Ended Months Ended
Sept 30 Sept 30
-------------- --------------
1995 1994 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net revenues 100.0% 100.0% 100.0% 100.0%
Costs of products sold 61.6 60.3 65.6 60.4
----- ----- ----- -----
Gross margin 38.4 39.7 34.4 39.6
Advertising and promotion 12.3 14.5 13.0 17.0
Other selling and
administrative 11.7 12.2 16.4 15.3
Research and development 2.6 3.8 4.5 5.7
----- ----- ---- ----
Earnings (loss) from
operations 11.8 9.2 0.5 1.6
Net proceeds from Nintendo
award - - - 10.6
Interest expense (1.5) (1.2) (1.7) (1.5)
Other income (expense), net 0.1 0.1 0.2 0.2
Provision for income taxes - (0.3) - (0.4)
------ ------ ----- -------
Net earnings (loss) 10.4 % 7.8 % (1.0) % 10.5 %
====== ====== ====== =======
</TABLE>
1995 Compared to 1994
Net revenues of $65.5 million in the third quarter of 1995 represented a 30%
increase from net revenues of $50.3 million in the third quarter of 1994. Both
domestic and international sales grew by 30%, with international sales reaching
record levels.
In the third quarter of 1995 Sky Dancers(TM) and My Pretty Dollhouse(TM) sales
were $24.1 million and $3.4 million, respectively. These products were first
introduced in late 1994.
7
<PAGE> 10
LEWIS GALOOB TOYS, INC., AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
continued
Micro Machines(TM) sales were $28.8 million in the third quarter of 1995 as
compared to $31.1 million in the same period in 1994. The decrease in sales is
mainly attributable to a decline in sales from the Micro Machines Z-BOTS(TM)
segment and this decline is expected to continue.
Biker Mice from Mars(TM) sales were $7.5 million in the third quarter of 1995
as compared to $14.4 million in 1994. Domestic sales to retailers have
discontinued, as planned, while international sales have been strong.
Net revenues of $137.1 million in the nine month period ended September 30,
1995 represented a 20% increase from net revenues of $114.2 million in the same
period in 1994. Sky Dancers and My Pretty Dollhouse sales were $44.0 million
and $7.3 million, respectively. Micro Machines sales were $56.9 million as
compared to $65.2 million in 1994. Biker Mice from Mars sales were $19.6
million as compared to $33.3 million in 1994. These sales trends reflect the
same factors as noted for the third quarter results.
Gross margins were $25.2 million in the third quarter of 1995 as compared to
$19.9 million in the same period of 1994. The higher sales volume increased
gross margin by $6.0 million but was offset by a $0.7 million decrease from a
lower gross margin rate. The gross margin rate decreased to 38.4% in 1995 from
39.7% in 1994 due mainly to tooling and packaging development costs. These
costs were a higher percent of revenues in 1995 as compared to 1994, because of
planned increased spending in support of the Company's expanded product lines.
Gross margins were $47.1 million in the nine month period ended September 30,
1995 as compared to $45.2 million in the same period in 1994. The higher sales
volume increased gross margins by $9.0 million but was offset by a $7.1 million
decrease from a lower gross margin rate. The gross margin rate decreased to
34.4% in 1995 from 39.6% in 1994 due primarily to two factors. First, tooling
and packaging design costs were a higher percent of revenues in 1995 as
compared to 1994 in support of the Company's expanded product lines. Second,
international sales as a percentage of worldwide revenues were higher in 1995
compared to 1994. The Company's gross margin on international sales is
significantly lower than domestic sales because international prices are lower
as the customer is responsible for the cost of importing and promoting the
product.
Advertising and promotion expenses were $8.1 million in the third quarter of
1995 as compared to $7.3 million in the same period in 1994. The higher
expenses were a result of higher domestic sales because media is expensed as a
percent of sales.
8
<PAGE> 11
LEWIS GALOOB TOYS, INC., AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
continued
Advertising and promotion expenses as a percentage of net revenues in the third
quarter were 12.3% in 1995 compared to 14.5% in 1994. For the nine month
period ended September 30, 1995 advertising and promotion expenses were $17.7
million or 12.9% of net revenues in 1995 as compared to $19.5 million or 17.0%
in 1994. The lower expenses were a result of a decrease in planned domestic
television advertising expense as a percent of sales.
Other selling and administrative expenses were $7.6 million in the third
quarter of 1995 as compared to $6.1 million in the same period in 1994. For
the nine month period ended September 30, 1995, other selling and
administrative expenses were $22.5 million in 1995 as compared to $17.5 million
in the same period in 1994. For the quarter and nine month period ended
September 30, 1995 the increase in expenses was due mainly to (1) higher
planned personnel costs as a result of the Company's growth and product line
expansion,(2) higher legal expenses and (3) higher freight costs.
Research and development expenses were $1.7 million in the third quarter of
1995 as compared to $1.9 million in the same period in 1994. For the nine
month period ended September 30, 1995 research and development expenses were
$6.2 million in 1995 compared to $6.5 in 1994. The decrease was due to timing
of expenditures in 1995 as compared to 1994.
In 1994, the net proceeds from the Nintendo award represents the receipt, net
of associated legal and related expenses, of the Company's share of proceeds
from its litigation with Nintendo.
Interest expense was $1.0 million in the third quarter of 1995 as compared to
$0.6 million in the same period in 1994. For the nine month period ended
September 30, 1995 interest expense was $2.4 million in 1995 as compared to
$1.7 million in the same period in 1994. The increase was due to higher
average borrowings and a higher interest rate in 1995 as compared to 1994.
In 1995, no tax provisions were recorded due to the Company's net operating
loss and tax credit carryforwards. In 1994, the income tax provision reflects
the quarterly application of the estimated annual rate based on the projected
full year earnings and includes the utilization of net operating loss
carryforwards.
9
<PAGE> 12
LEWIS GALOOB TOYS, INC., AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
continued
The Company's products are produced principally in China which currently is
designated with "most favored nation" ("MFN") status by the United States.
This allows products imported into the United States from China to be accorded
the most favored import duties. In late 1994, Congress approved the GATT
(Uruguay round) unconditional duty-free entry from any nation with MFN status.
Generally, the trade negotiations between China and the United States have been
difficult, but both sides have shown their willingness to resolve trade
disputes and avoid punitive sanctions. Punitive sanctions could result in the
United States imposing higher duties on selective Chinese-made products
imported into the United States (these sanctions would be put in place through
Section 301). In the past Section 301 sanctions proposed by the United States
did not include sanctions or punitive duties against toy imports from China.
As such, the Company would be unaffected. The loss of MFN status for China
would result in a substantial increase in import duty for the Company's
products produced in China and imported into the United States. This increase
in duty would be large enough that it could materially affect the Company's
business. Products shipped to other countries should not be affected. Other
toy companies also source product from China and would be affected to similar
degrees. However, the impact on the Company from any significant change in
duties on its Chinese produced product would depend on several factors
including, but not limited to, the Company's ability to: (1) procure
alternative manufacturing sources outside of China; (2) retrieve its tooling
located in China; (3) relocate its production in sufficient time to meet
demand; and (4) pass resultant cost increases through as product price
increases.
Liquidity, Financial Resources and Capital Expenditures
On March 31, 1995, the Company entered into the New Agreement with the Lender.
(See Note B of the Notes to Condensed Consolidated Financial Statements).
Working capital was $52.4 million at September 30, 1995 compared to $53.2
million at December 31, 1994 and $47.2 million at September 30, 1994. The
ratio of current assets to current liabilities was 1.9 to 1.0 at September 30,
1995 compared to 2.4 to 1.0 at December 31, 1994 and 2.3 to 1.0 at September
30, 1994.
The Company had no material commitments for capital expenditures at September
30, 1995.
The Company believes that with its assets, the results of operations and the
New Agreement it has adequate liquidity and capital resources to meet its
current and anticipated operating needs.
10
<PAGE> 13
LEWIS GALOOB TOYS, INC. AND SUBSIDIARIES
PART II
Item 1. Legal Proceedings
The Company is involved in various legal and/or litigation matters which are
being defended and handled in the ordinary course of business. None of these
matters is expected to result in outcomes having a material adverse effect on
the Company's consolidated financial position.
Item 3. Defaults Upon Senior Securities
On June 10, 1992, the Company announced it would not pay the July 1, 1992
$0.425 per share quarterly dividend on its Depositary Shares which represent
shares of the Company's Preferred Stock. The Company has not paid the
subsequent quarterly dividends. As of September 30, 1995, the dividend was
cumulatively fourteen quarters in arrears, representing a total dividend
arrearage of $11.0 million. By the terms of the Certificate of Designations
for the Company's Preferred Stock, the Company is not legally obligated to pay
any such arrearage. The Company has consistently maintained that it is not in
its best interest to reinstate the dividend until the Company has generated
consistent net income from operations and continuation of such profitability
can be reasonably expected. Based upon recent results, the Company has been
evaluating its alternatives with regard to the preferred stock. The net
earnings (loss) per share calculation includes a provision of the Preferred
Stock dividends in arrears. No common stock dividends may be paid unless all
preferred dividend payments are current. As a result of the cumulative
dividend being six or more quarters in arrears, on July 15, 1994 the holders of
the Preferred Stock exercised their right to elect two directors to the Board
of Directors of the Company.
Item 6. Exhibits, and Reports on Form 8-K
(a) Exhibits - Exhibit 27 - Financial Data Schedule
(b) Reports on Form 8-K - None.
11
<PAGE> 14
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.
LEWIS GALOOB TOYS, INC.
(Registrant)
DATE: November 14, 1995 BY: \s\ William B. Towne
---------------------- -----------------------
William B. Towne
Executive Vice President,
Finance and
Chief Financial Officer
(Principal Accounting
Officer)
12
<PAGE> 15
EXHIBIT INDEX
Exhibit 27 - Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements of Lewis Galoob Toys, Inc. for the quarter ended September
30, 1995, and is qualified in its entirety by reference to such financial
statements.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JUL-01-1995
<PERIOD-END> SEP-30-1995
<CASH> 3,758
<SECURITIES> 0
<RECEIVABLES> 72,328
<ALLOWANCES> 6,455
<INVENTORY> 19,236
<CURRENT-ASSETS> 108,050
<PP&E> 14,606
<DEPRECIATION> 6,438
<TOTAL-ASSETS> 117,344
<CURRENT-LIABILITIES> 55,663
<BONDS> 18,256
<COMMON> 101
36,790
0
<OTHER-SE> 6,534
<TOTAL-LIABILITY-AND-EQUITY> 117,344
<SALES> 65,518
<TOTAL-REVENUES> 65,518
<CGS> 40,369
<TOTAL-COSTS> 40,369
<OTHER-EXPENSES> 17,446
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 970
<INCOME-PRETAX> 6,837
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 6,837
<EPS-PRIMARY> 0.58
<EPS-DILUTED> 0.50
</TABLE>
