<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[Mark one]
[ X ] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended JUNE 30, 1999
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from _______________ to ________________
Commission File Number: 0-14675
CAMERA PLATFORMS INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
Delaware 95-4024550
(State or other jurisdiction) (IRS Employer Identification No.)
of incorporation or organization)
10909 Vanowen Street, North Hollywood, California 91605
(Address of principal executive offices) (Zip Code)
(818) 623-1700
(Registrants telephone number, including area code)
Not Applicable
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or 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 July 31, 1999.
Common Stock $.0005 par value 13,768,228
(Class) (Number of shares)
<PAGE> 2
CAMERA PLATFORMS INTERNATIONAL, INC
INDEX
<TABLE>
<CAPTION>
Page Number
<S> <C>
PART I. FINANCIAL INFORMATION:
Item 1. Financial Statements:
Condensed Consolidated Statement of Financial Position
at June 30, 1999, and December 31, 1998 3
Condensed Consolidated Statement of Operations for the
Three Months ended June 30, 1999 and 1998 and the
Six Months ended June 30, 1999 and 1998 4
Condensed Consolidated Statement of Cash Flows for the
Six Months ended June 30, 1999 and 1998 5
Notes to Condensed Consolidated Unaudited Financial
Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 11
PART II. OTHER INFORMATION 13
Signature Page 13
</TABLE>
<PAGE> 3
CAMERA PLATFORMS INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(Unaudited)
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
<C> <C>
ASSETS
Current Assets
Cash $ 16,000 $ 26.000
Accounts receivable, less allowance
for doubtful accounts of $7,000 in
1999 and $46,000 in 1998 127,000 153,000
Current maturities of net
Investment in sales-type lease
and installment sales 43,000 43,000
Inventories 873,000 964,000
Prepaid expenses 240,000 191,000
--------- ---------
Total current assets 1,299,000 1,377,000
Property and equipment, net of accumulated
depreciation and a $542,000 rental asset
valuation allowance 2,158,000 2,644,000
Net investment in sales-type lease
and installment sale, net of current
maturities 11,000 38,000
Deposits and other noncurrent assets 32,000 56,000
--------- ---------
$3,500,000 $4,115,000
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Accounts payable $1,186,000 $1,220,000
Current portion of long-term debt 4,466,000 1,195,000
Customer deposits 67,000 19,000
Deferred Revenue 36,000 29,000
Other current liabilities 342,000 192,000
--------- ---------
Total current liabilities 6,097,000 2,655,000
Long-term debt, net of current maturities 500,000 3,747,000
Shareholders' Equity
Common stock $.0005 par value; 15,000,000
shares authorized; shares issued and
outstanding: 13,768,228 in 1999 and 1998 7,000 7,000
Additional paid-in capital 23,549,000 23,547,000
Accumulated deficit (26,653,000) (25,841,000)
------------ ------------
Total shareholders' equity (3,097,000) (2,287,000)
------------ -----------
$3,500,000 $4,115,000
============ ===========
</TABLE>
SEE ACCOMPANYING NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
<PAGE> 4
CAMERA PLATFORMS INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three months Six months
ended June 30, ended June 30,
1999 1998 1999 1998
<C> <C> <C> <C>
Revenues
Sales $ 240,000 $ 283,000 $ 292,000 $344,000
Rentals 296,000 784,000 601,000 1,316,000
--------- --------- --------- ---------
536,000 1,067,000 893,000 1,660,000
Expenses
Cost of sales 124,000 214,000 151,000 249,000
Cost of rentals 365,000 392,000 726,000 1,430,000
Selling, general and
administrative 211,000 553,000 531,000 1,044,000
-------- --------- --------- ---------
700,000 1,159,000 1,408,000 2,723,000
-------- --------- --------- ---------
Operating loss (164,000) (632,000) (515,000) (1,063,000)
Interest expense, net 148,000 86,000 290,000 151,000
Other income (expense), net 17,000 25,000 45,000 30,000
Net loss from discontinued
operations (52,000)
----------- ----------- ----------- ------------
Net loss ($ 295,000) ($ 693,000) ($ 812,000) ($1,184,000)
=========== =========== =========== ============
Net loss per share
of common stock ($0.02) ($0.05) ($0.06) ($0.09)
Weighted average number
of shares outstanding 13,768,228 13,768,228 13,768,228 13,768,228
</TABLE>
SEE ACCOMPANYING NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
<PAGE> 5
CAMERA PLATFORMS INTERNATIONAL, INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Six months ended
June 30, 1999 June 30, 1998
<C> <C>
OPERATING ACTIVITIES
Net loss ($ 812,000) ($ 1,184,000)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization 336,000 326,000
(Gain) on sale of equipment (32,000)
Provision (credit) for doubtful accounts (39,000) 1,000
Changes in assets and liabilities:
Accounts receivable 65,000 (295,000)
Inventories 91,000 (1,029,000)
Installment sales 27,000
Prepaid expenses (49,000) (72,000)
Deposits and noncurrent assets 24,000 213,000
Accounts payable (34,000) 494,000
Other current liabilities 233,000 342,000
------- --------
Net cash used in operating activities (190,000) (1,204,000)
INVESTING ACTIVITIES
Purchases of property and equipment (3,663,000)
Proceeds from sale of equipment 182,000 81,000
Purchase of goodwill and covenant
not to compete (1,040,000)
------- ----------
Net cash provided by (used in)
investing activities 182,000 (4,622,000)
FINANCING ACTIVITIES
Proceeds from borrowings of short-term debt 190,000
Principal payment on short-term debt (10,000)
Proceeds from borrowing of long-term debt 4,754,000
Principal payment on long-term debt (4,000) (448,000)
Proceeds from issuance of stock 2,000 1,345,000
------- ---------
Net cash provided by financing activities (2,000) 5,831,000
------- ---------
Net increase (decrease) in cash (10,000) 5,000
Cash at beginning of year 26,000 77,000
-------- ---------
Cash at end of period $ 16,000 $ 82,000
======== =========
Supplemental disclosure of cash flow information
Cash paid during the period for:
Interest $ 23,000 $146,000
Income taxes 1,000
</TABLE>
SEE ACCOMPANYING NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS.
<PAGE> 6
CAMERA PLATFORMS INTERNATIONAL, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form 10-Q and
Rule 10-01 of Regulation S-X. 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 normal recurring adjustments considered necessary for a fair presentation
have been included. Operating results for the six month period ended June 30,
1999 are not necessarily indicative of the results that may be expected for
the year ending December 31, 1999. For further information refer to the
financial statements and footnotes thereto included in the Company's annual
report on Form 10-K for the year ended December 31, 1998.
NOTE 2 - BANKRUPTCY OF SUBSIDIARIES
On April 2, 1999, the Company's wholly owned subsidiaries Shotmaker Dollies,
Inc. and Shotmaker Sound, Inc. filed for protection under Chapter 7 of the
federal bankruptcy code. On July 1, 1999, the trustee filed a report
recommending to the court a finding of no assets for these debtors. The
filing of the bankruptcies is not expected to impact the operations of the
Company.
NOTE 3 - INVENTORIES
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
<S> <C> <C>
Raw materials $ - $ -
Work in process 355,000 185,000
Finished goods 518,000 137,000
-------- --------
$873,000 $322,000
======== ========
</TABLE>
NOTE 4 - PROPERTY AND EQUIPMENT
<TABLE>
<CAPTION>
June 30, December 31,
1999 1998
<S> <C> <C>
Rental equipment $6,395,000 $6,523,000
Machinery and equipment 351,000 390,000
Leasehold improvements 63,000 73,000
Furniture and fixtures 77,000 94,000
Automobiles and trucks 132,000 143,000
--------- ---------
7,018,000 7,223,000
<PAGE> 7
Less accumulated depreciation and
amortization 4,318,000 4,037,000
Less rental asset valuation allowance 542,000 542,000
--------- ---------
$2,158,000 $2,644,000
========== ==========
</TABLE>
NOTE 5 - LONG TERM DEBT
In October, 1997 the Company secured a $2.5 million credit facility,
consisting of (1) $1,250,000 term loan, (2) $750,000 revolving line of
credit and (3) $500,000 inventory equipment line of credit, with interest
at reference rate plus 2% (effective rate of 11.0% at June 30, 1999),
with Foothill. The original maturity of the loan was January 15, 2000.
The term loan required monthly principal reductions of $25,000. The loans
refinanced an earlier credit facility totaling $850,000 which matured October
15, 1997.
Subsequently, Foothill advanced $1 million for the purchase of Production
Services - Atlanta ("PSA") and $1.25 million for the purchase of Fluid
Images, Inc.
All the Foothill loans are cross-collateralized and are secured by
substantially all of the assets of the Company.
On December 22, 1998, the Company entered into a forbearance agreement with
Foothill. The agreement called for $37,959 to be paid to Foothill upon the
sale of the assets of Shotmaker Sound to be applied against past due interest;
no further advances under any of the notes; and an extension of the due date
of all the notes to February 15, 2001. As part of the agreement, past due
interest of $92,000 together with an annual renewal fee of $32,000, was
added to principal. The agreement called for interest for ninety days, with
monthly principal payments of $45,200 plus interest commencing with the April
15, 1999 payment.
Effective as of May 27, 1999, the Company entered into a second forbearance
agreement with Foothill in which Foothill agreed to forbear from foreclosure
until July 31, 1999 provided that the Company remit $5,000 per week in
interest payments, and that the Company ratify the outstanding indebtedness
to Foothill as of May 25, 1999 in the amount of $3,283,000. The Company
further agreed, if requested by Foothill, to turn over physical possession
of the collateral on July 31, 1999.
The Company is obligated under a promissory note due to the former
shareholders of PSA of $500,000, bearing interest at 8% payable quarterly,
principal all due and payable April, 2001. The note is unsecured. At
June 30, 1999, the Company was in default of interest payments under the
note. The former shareholders have filed suit for payment of the past due
interest thereunder. (Note 6, "Litigation").
The former shareholders of Fluid Images, Inc. are holders of a promissory
note in the principal amount of $750,000. The Company defaulted on interest
payments due under the note. The former shareholders of Fluid Images, Inc.
received an award in arbitration for the full amount of the promissory note
in the principal sum of $750,000 plus accrued interest thereon from August
27, 1998 at the rate of 10% per annum together with attorneys' fees and costs
(Note 6, "Litigation").
<PAGE> 8
CAMERA PLATFORMS INTERNATIONAL, INC.
The Company has a $250,000 unsecured obligation to UST Inc., the former
majority shareholder of the Company, bearing interest at the Bank of Boston
reference rate (7.75% at March 31, 1999) which was due and payable together
with accrued interest thereon on April 11, 1998. Demand has been made on the
note, but no further action or discussions have taken place.
The Company failed to pay a $150,000 unsecured obligation to an unrelated
third party upon maturity, demand was made, and litigation commenced.
On May 11, 1999 the United States District Court for the Northern District
of Illinois entered a default judgment in favor of the obligee in the amount
of $169,000 (Note 6, "Litigation").
The Company is financing its remaining obligation on its purchase of the
worldwide rights to the "Enlouva" patents and trademark over thirty-five
equal monthly installments of $1,000, including interest at 10%. The note
matures December 1999. In the event of default, the seller is entitled to
collect money damages, restoration to the right of the name "Enlouva", the
right to manufacture and sell cranes under the "Enlouva" name, and the
restoration of parts shipped. As of June, 1999, the Company was in arrears
of seven payments.
NOTE 6 - LITIGATION
Peterman v Camera Platforms International, De La Motte v Camera Platforms
International. On July 2, 1997, the platform of a Panther Pegasus crane
which had been leased by the Company to Mighty Joe Young Productions, Inc.
("MJY") fell, injuring the two operators who were on the platform. The
Company's insurance carrier has assumed the defense of the matter. The
Company is vigorously defending against the claims, and believes that the
cause of the accident was operator error. In addition to its own
policies, the Company is an additional named insured on the policies of
MJY with respect to the lease of the crane. Management believes that
exposure, if any, is fully covered by insurance. Trial is set for
October 4, 1999.
Johnson v Camera Platforms International. The former shareholders of Fluid
Images Inc., holders of a $750,000 unsecured obligation (Note 5) filed notice
on February 1, 1999 with the American Arbitration Association requesting a
binding arbitration hearing. The Company is in default under the provisions
of the note, and Johnson has demanded payment in full pursuant to an
acceleration provision in the note. The former shareholders of Fluid Images,
Inc. were successful in their motion for summary judgment in arbitration,
and received an award for the full amount of the promissory note in the
principal sum of $750,000 plus accrued interest thereon from August 27, 1998
at the rate of 10% per annum together with attorneys' fees and costs. On
July 13, the former shareholders filed a petition to confirm the arbitration
award in Los Angeles Superior Court. The hearing is set for August 6, 1999.
Traba v Camera Platforms International. On February 17, 1999, Traba, the
holder of a past due $150,000 unsecured obligation (Notes 5) filed suit
in Federal Court in Chicago demanding payment in full, together with unpaid
interest and attorney's fees. On May 11, 1999 the United States District
Court for the Northern District of Illinois entered judgment in favor of
<PAGE> 9
CAMERA PLATFORMS INTERNATIONAL, INC.
the obligee in the amount of $169,000.
JMYC v Camera Platforms International. On January 26, 1999, JMYC, former
shareholders of PSA (Note 5), filed suit in Atlanta for past due interest
payments and certain accounts receivable allegedly collected by the Company
on its behalf but not paid over. The total claim is approximately $50,000,
which has been accrued in the financial statements of the Company. On
July 16, 1999, the former shareholders of PSA filed their motion for entry
of default judgment.
Crockett and Fish v Camera Platforms International. Crockett and Fish
represented Cinemeccanica Italiana Srl. in its defense of an action brought
by Leonard Studio Equipment Inc. The Company agreed to pay certain costs
of defense on behalf of Cinemeccanica. On December 8, 1998, Crockett and
Fish filed suit claiming $132,000 of unpaid attorneys' fees, which has
been accrued in the financial statements of the Company. On May 19, 1999,
the Company entered into a settlement agreement in which it agreed to pay
Crockett and Fish $120,000 in installments of $10,000 plus interest
commencing August 1, 1999.
Atlas v Camera Platforms International. A claim by the Company's former
President and Chief Operating Officer for breach of employment contract
arising out of his termination in June, 1998 was settled in March, 1999.
The agreement calls for a four month consulting contract at $10,000 per
month, which will be recorded contemporaneously, and issuance of stock
pursuant to previously granted options. As of July 30, 1999, no payments
have been made under the agreement.
U.S. Bancorp Leasing & Financial v Camera Platforms International. US
Bancorp filed suit on March 4, 1999 for damages of $165,000 and/or
possession in connection with the lease of certain equipment. Default
has been entered against the Company and a hearing regarding damages is
set for September, 1999.
Prologis v Camera Platforms International In December, 1998, a Tennessee
state judgment in the amount of $27,000 was entered in California against
the Company for unpaid rent at its former Nashville location. The amount
is accrued on the financial statements of the Company. The judgment remains
unpaid.
Norman Industrial Metals v Camera Platforms International On May 13, 1999,
the Company entered into a settlement agreement in which it agreed to pay
$35,000 plus interest in monthly payments of $2,000 per month commencing
July 1, 1999. The amount is accrued on the financial statements of the
Company. The Company failed to make the payment due July, 1999.
Other. The Company is a defendant in various actions by creditors for
claimed unpaid invoices. The aggregate amount of such claims is
approximately $100,000. Such amounts are included in accounts payable.
NOTE 7 - INCOME TAXES
The Company utilizes the liability method to account for income taxes. Under
this method, deferred tax assets and liabilities are determined based on
differences between financial reporting and tax bases of assets and
<PAGE> 10
liabilities and are measured using the enacted tax rates and laws expected
to apply when the differences are expected to reverse.
At June 30, 1999, the Company had net operating loss carry forwards of
approximately $23 million for federal tax purposes, which expire from 2000
to 2013. Because of statutory ownership changes, the amount of net
operating losses which may be utilized in future years is subject to
significant annual limitations. The Company has California net operating
loss carry forwards of approximately $4 million for tax purposes, which
expire from 1999 to 2003. The Company also has federal research and
development credits of approximately $64,000, expiring in 2001 and 2002,
which may be used to offset future tax liabilities. At June 30, 1999,
total deferred tax assets, consisting principally of net operating loss
carry forwards, amounted to approximately $8 million. For financial
reporting purposes, a valuation allowance has been recognized in an amount
equal to such deferred tax assets due to the uncertainty surrounding their
ultimate realization.
The effective tax rate differs from the U.S. Federal statutory rate
principally due to the valuation allowance recognized due to the uncertainty
surrounding the ultimate realization of deferred tax assets.
<PAGE> 11
CAMERA PLATFORMS INTERNATIONAL, INC.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
(Unaudited)
LIQUIDITY AND CAPITAL RESOURCES
The Company has incurred net losses of $295,000 in the current quarter,
$759,000 to date in 1999, and $3,597,000 in fiscal 1998, together with
significant losses in previous years. The Company shows a negative
shareholders' equity of $3,097,000. The Company also recorded negative cash
flows from operations of $190,000 in the current quarter, $331,000 to date
in 1999, and $1,522,000 in 1998. The Company is in default on all of its
borrowing facilities. The Company has been able to secure financing to
support operations to date, but there is no assurance that funding will be
available to support the operations in the future.
The Company's continued ability to operate is dependent on its ability to
extend its existing debt forbearance agreement, liquidate significant assets,
or raise additional capital. In addition, significant concessions must be
negotiated with the Company's subordinated lien holders and unsecured
creditors. Management is negotiating with its primary lender to extend the
terms of the credit facility, but this will not provide additional working
capital for operations. Management is actively seeking buyers for its
rental divisions. There can be no assurance that any sale will occur,
or that the credit facility will be extended in a manner that allows the
Company to continue its operations in its present form. The financial
statements do not include any of the adjustments that might result from
the outcome of this uncertainty.
RESULTS OF OPERATIONS
The following analysis compares the three months ended June 30, 1999, with
the three months ended June 30, 1998, and the six months ended June 30, 1999,
with the six months ended June 30, 1998.
The Company's revenues for the second quarter and first six months of 1999
decreased by 39% and 32%, respectively, as compared with the corresponding
periods of the prior year. Both second quarter and year-to-date sales
revenues decreased by 15% over the comparative periods of 1998. Revenue
decreases were primarily associated with the closure of the Atlanta/Nashville
operations, which accounted for $195,000 in rental revenue in the second
quarter of 1998. International customers accounted for 83% of sales for
the six month period, as compared with 68% in the second quarter of 1998.
<PAGE> 12
CAMERA PLATFORMS INTERNATIONAL, INC
The Company's camera car rental revenues increased by 8% compared with the
same quarter of 1998, while dolly and crane rental revenues decreased by
67%, exclusive of the effect of the closure of Atlanta/Nashville. Year to
date, camera car revenues decreased by 8%, while dolly and crane rentals
decreased by 64%.
Gross margin on sales increased from 24% in the second quarter of 1998 to
48% in the current quarter, primarily due to sales of the Company's Blue
Dollies. Year-to-date sales gross margins increased from 28% in 1998 to 48%
in 1999. The higher margins in the current year are due primarily to low
margins on the first group of Shotmaker Blue Dollies delivered in 1998,
which were imported at a high per unit cost. Rental gross margins increased
from -38% in the second quarter of 1998 to -23% in the current quarter. Year-
to-date rental gross margins increased from -28% to -21%. The increases in
gross margin are due to lower personnel costs associated with layoffs in
May, 1999 and the elimination of the substantial rental losses associated
with the Atlanta, Nashville and New York operations in 1998 as a result of
their closures. These decreases in costs were associated with a substantial
decrease in revenues, modifying the effect on the gross margins.
Selling expense for the second quarter decreased by approximately 55% over
1998. Year-to-date, the decrease was 59%. The increase was attributable to
decreased advertising and payroll. General and administrative expenses
decrease 56% in the current quarter as compared with the corresponding
quarter of 1998. Year-to-date, the decrease was 37%. The decreases are a
result of substantial layoffs in May, 1999, together with lower costs
associated with the closures of Atlanta/Nashville and New York.
Interest expense increased by 73% from the second quarter of 1998, and 92%
year-to-date compared with 1998. The increase reflects the effect of the
Company's borrowings to fund the purchase of the Atlanta/Nashville
operations, net of repayments to Foothill Capital from the proceeds of the
auction in November, 1998 of those assets, together with the debt incurred
to purchase Fluid Images, Inc. (Akela Cranes).
The Company's net loss decreased $398,000 (57%) in the second quarter,
and $430,000 (36%) year-to-date. $233,000 of the reduction is due to the
closure of Atlanta/Nashville and New York. The net loss per share for the
quarter decreased from $0.05 to $0.02, and the net loss per share for the
six months decreased from $0.09 to $0.06.
Inflation has not had a material impact on the Company's operations to date,
and the Company believes it will not have a material effect on operations in
the next twelve months.
All international sales are denominated and remitted in U.S. dollars, and
foreign transactions are generally settled within a short period of time.
Accordingly, the Company does not anticipate that foreign currency
fluctuations will have a material effect on operations in the next twelve
months.
<PAGE> 13
CAMERA PLATFORMS INTERNATIONAL, INC.
PART II - OTHER INFORMATION
Items 1, 2, 3 and 5
Not applicable
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 6. The Company filed a report on Form 8-K dated June 10, 1999,
reporting the resignation on May 24, 1999 of Edward Carlin as Chief
Executive Officer, Chairman and member of the Board of Directors, and the
subsequent resignations of Brianne Murphy and Leslie Kovaks as members of
the Board of Directors. In addition the report disclosed the employment
of Phillip Berardi as President and the appointment of Ronald J. Riddle
as Chief Operating Officer and Chief Financial Officer.
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.
CAMERA PLATFORMS INTERNATIONAL, INC.
/s/ PHILLIP BERARDI
Date: July 30, 1999 Phillip Berardi
President
/s/ RONALD J. RIDDLE
Date: July 30, 1999 Ronald J. Riddle
Chief Financial Officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONDENSED CONSOLIDATED BALANCE SHEET, CONDENSED CONSOLIDATED STATEMENT OF
INCOME AND THE CONDENSES CONSOLIDATED STATEMENT OF CASH FLOW AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> JUN-30-1999
<CASH> 26,000
<SECURITIES> 0
<RECEIVABLES> 134,000
<ALLOWANCES> 7,000
<INVENTORY> 873,000
<CURRENT-ASSETS> 243,000
<PP&E> 7,018,000
<DEPRECIATION> 4,860,000
<TOTAL-ASSETS> 3,500,000
<CURRENT-LIABILITIES> 6,097,000
<BONDS> 0
0
0
<COMMON> 7000
<OTHER-SE> (3,104,000)
<TOTAL-LIABILITY-AND-EQUITY> 3,500,000
<SALES> 240,000
<TOTAL-REVENUES> 536,000
<CGS> 124,000
<TOTAL-COSTS> 700,000
<OTHER-EXPENSES> (17,000)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 148,000
<INCOME-PRETAX> (295,000)
<INCOME-TAX> 0
<INCOME-CONTINUING> (295,000)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (295,000)
<EPS-BASIC> (.02)
<EPS-DILUTED> (.02)
</TABLE>
