FORM 10-Q
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[ X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended: March 31, 1996
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: 0-14617
RHEOMETRIC SCIENTIFIC, INC.
(Exact name of registrant as specified in its charter)
New Jersey 61-0708419
________________________________ ___________________________
(State or other jurisdiction of (I.R.S. Employer Identi-
incorporation or organization) fication Number)
One Possumtown Road, Piscataway, NJ 08854
_________________________________________ _____________
(Address of principal executive offices) (Zip Code)
(908) 560-8550
____________________________________________________________
(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.
Class Outstanding at May 1, 1996
__________________________ ______________________________
Common Stock, no par value 13,161,739
Page 1 of 13
<PAGE>
RHEOMETRIC SCIENTIFIC, INC.
FORM 10-Q
INDEX
Page
PART I - Financial Information
Item 1. Financial Statements
Condensed Consolidated Balance Sheets
March 31, 1996 and December 31, 1995 3
Condensed Consolidated Statements of Operations
Three Months Ended March 31, 1996 and 1995 4
Condensed Consolidated Statements of Cash Flows
Three Months Ended March 31, 1996 and 1995 5
Notes to Condensed Consolidated Financial
Statements 6-8
Item 2. Management's Discussion and Analysis of
Results of Operations and Financial Condition
Results of Operations 9-10
Liquidity and Capital Resources 10-12
PART II - Other Information
Item 6. Exhibits and Reports on Form 8-K 13
Signature 13
2
<PAGE>
<TABLE>
RHEOMETRIC SCIENTIFIC, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands)
<CAPTION>
ASSETS (Unaudited)
March December
31, 1996 31, 1995
<S> <C> <C>
Current Assets
Cash $ 2,663 $ 1,364
Net receivables 11,088 14,492
Net inventories
Finished goods 2,167 2,071
Work in process 1,870 1,366
Assembled Components, materials,
And parts 5,527 5,142
______ _____
9,564 8,579
Prepaid expenses and other assets 859 1,564
______ _____
Total current assets 24,174 25,999
______ ______
Property, Plant, and Equipment 19,046 21,348
Less accumulated depreciation and
amortization 11,724 11,505
______ ______
Net property, plant, and equipment 7,322 9,843
Goodwill, net 1,943 2,074
Other Assets 3,222 2,177
_______ ______
Total Assets $36,661 $40,093
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Short-term bank borrowings $ 6,545 $ 6,424
Short-term debt - affiliate -- 375
Current maturities of long-term debt 54 497
Accounts payable 4,147 3,780
Payable to affiliate 1,043 818
Accrued liabilities 4,936 4,975
______ ______
Total current liabilities 16,725 16,869
______ ______
Lease obligation 4,947 --
Long-term debt -- 5,233
Long-term debt - affiliate 5,740 5,740
Other long-term liabilities 1,286 1,363
______ ______
Total liabilities 28,698 29,205
Commitments and Contingencies
Shareholders' Equity
Common stock, stated value of $.001,
authorized 20,000 shares; issued and
outstanding 13,162 shares 13 13
Additional paid-in capital 25,492 24,759
Accumulated deficit (17,419) (13,871)
Cumulative translation adjustment (123) (13)
______ ______
Total shareholders' equity 7,963 10,888
Total Liabilities & Shareholders'
Equity $36,661 $40,093
======= =======
See Notes to Condensed Consolidated Financial Statements.
</TABLE>
3
<PAGE>
<TABLE>
<CAPTION>
RHEOMETRIC SCIENTIFIC, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
(In thousands, except per share data)
Three Months Ended
March 31
1996 1995
<S> <C> <C>
Sales $ 7,996 $ 8,601
Cost of sales 4,517 4,580
______ _____
Gross profit 3,479 4,021
General and administrative expenses 588 828
Marketing and selling expenses 2,664 2,490
Research and development expenses 756 754
Goodwill and intangible amortization 165 162
Loss on sale/leaseback 2,368 --
_____ _____
Total Operating Expenses 6,541 4,234
Operating loss (3,062) (213)
Interest expense - Banks 204 273
Interest expense - Affiliate 187 146
Interest income -- 1
Foreign currency (loss) gain (92) 235
_____ _____
Loss before income taxes (3,545) (396)
Income tax expense (3) (7)
_____ _____
Net loss $(3,548) $ (403)
====== ======
Net loss per share $ (0.27) $(0.03)
====== ======
Average number of shares
outstanding 13,162 13,162
====== ======
</TABLE>
See Notes to Consolidated Financial Statements.
4
<PAGE>
<TABLE>
<CAPTION>
RHEOMETRIC SCIENTIFIC, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands) (Unaudited) Three Months Ended
March 31,
1996 1995
<S> <C> <C>
Cash Flows from Operating Activities:
Net loss $ (3,548) $ (403)
Adjustments to reconcile net loss to net cash
provided by operating activities:
Depreciation and amortization of plant and
equipment 248 240
Amortization of goodwill and intangibles 165 162
Provision for slow moving inventory 67 148
Loss on sale/leaseback financing 2,301 --
Unrealized currency loss (gain) 104 (203)
Changes in assets and liabilities:
Receivables 3,146 1,108
Inventories (1,151) (1,017)
Prepaid expenses and other current
assets 702 (17)
Accounts payable and accrued
liabilities 629 214
Income tax payable -- (23)
Other assets (260) (27)
Other non-current liabilities (25) (7)
______ _____
Net cash provided by operating activities 2,378 175
______ _____
Cash Flows from Investing Activities:
Purchases of property, plant, and equipment (47) (16)
______ _____
Net cash used in investing activities (47) (16)
______ _____
Cash Flows from Financing Activities:
Net borrowings (repayments) under line of
credit agreements 227 165
Repayment of long-term debt (5,730) (124)
Repayment short-term debt to affiliate (375) --
Net proceeds from sale/leaseback arrangement 5,734 --
Mortgage participation (861) --
______ _____
Net cash (used in) provided by financing
activities (1,005) 41
Effect of exchange rate changes on cash (27) (62)
_____ _____
Net increase in cash 1,299 138
Cash at beginning of period 1,364 747
_____ _____
Cash at end of period $2,663 $ 885
====== ======
Cash payments for interest $ 336 $ 441
====== ======
Cash payments for income taxes $ 3 $ 29
====== ======
</TABLE>
See Notes to Condensed Consolidated Financial Statements.
5
<PAGE>
RHEOMETRIC SCIENTIFIC, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Accounting Policies
The information included in the foregoing interim financial statements
is unaudited. In the opinion of management, all adjustments, consisting
of normal recurring accruals, necessary for a fair presentation of
financial position and results of operations for the interim periods
presented have been reflected herein. The results of operations for
the interim periods are not necessarily indicative of the results to be
expected for the entire year.
2. Liquidity
Management believes that the cash generated from operations, funds
available under the lines of credit, Axess's debt financing and funds
received under its current loan agreement, should be sufficient to meet
the Company's working capital needs for the remainder of the fiscal
year. On February 23, 1996 the Company entered into a three-year Loan
and Security Agreement (the "Loan Agreement"). This agreement provides
a working capital revolving credit facility with a maximum credit
amount of $11,500,000. The amount of available credit is determined by
the level of certain eligible receivables and inventories. Adequacy of
cash flows generated beyond 1996 will depend on the Company's ability
to achieve expected sales volumes to support profitable operations.
3. Financing
On February 23, 1996, the Company entered into a sale/leaseback
arrangement which is recorded as a financing whereby the Company sold
the Company's corporate headquarters and main manufacturing facility,
and the 19 acres of real property on which the facility is located (the
facility and the real estate being referred to herein as the
"Facility") for $6,300,000. Simultaneously with the sale to the
Landlord, the Company entered into a long-term lease of the Facility
from the Landlord. The initial term of the lease is 15 years, subject
to automatic five-year extensions through 2026. Under the terms of the
lease, the Company has certain rights of first refusal to purchase the
Facility and the right to acquire up to 11 acres of undeveloped real
estate constituting a portion of the facility (the "Excess Land") under
certain circumstances.
Simultaneously with the consummation of the sale/leaseback arrangement,
the Company entered into a Loan and Security Agreement providing for a
working capital revolving credit facility in the amount of $11,500,000.
The amount of available credit is determined by the level of certain
eligible receivables and inventory. The Company's obligations under
the Loan Agreement are collateralized by substantially all of the
Company's assets.
6
<PAGE>
The Landlord financed the acquisition of the Facility in part through a
$3,300,000 mortgage loan. The Company purchased a participating
interest in the Landlord's mortgage loan (the "Mortgage Loan") in the
amount of $861,000. The Company's interest in the Mortgage Loan will
be repaid with yearly interest of 9.625% upon the maturity of the
Mortgage Loan in five years or upon refinancing.
Further, in connection with the sale/leaseback arrangement, the Company
issued the following three warrants to acquire shares of its Common
Stock, all having an exercise price of $2.00 per share: (1) a warrant
to the Landlord to purchase 132,617 shares of Common Stock of the
Company, exercisable during the term of the lease; (2) a conditional
warrant to the Landlord to purchase 331,543 shares of Common Stock of
the Company which shall only be exercisable if the indebtedness owed by
Landlord under the Mortgage Loan is repaid prior to February 23, 1997;
or if the Landlord is unable to refinance the indebtedness owed under
the Mortgage Loan prior to February 23, 1997, solely as a result of
environmental contamination relating to the 11 acres of undeveloped
real estate constituting a portion of the facility (the "Excess Land");
and (3) a conditional warrant to the Landlord's Lender (the "Lender")
to purchase 331,543 shares of Common Stock which shall only be
exercisable if the indebtedness owed under the Mortgage Loan by
Landlord to Lender is not refinanced prior to February 23, 1997.
A portion of the proceeds from the sale of the Facility and the Loan
Agreement were used to provide the funds necessary to repay the
Company's mortgage indebtedness of approximately $5,700,000 and
existing line of credit of approximately $3,000,000.
As a result of the sale/leaseback arrangement of the Facility, the
Company recognized a loss of $2,368,000 in the first quarter because
the proceeds of the financing were less than the carrying value of the
Facility. The issuance of $733,373 of warrants and the recording of
the lease obligation of $5,001,000 are considered non-cash transactions
for cash flow statement purposes.
The Loan Agreement is for a term of three years. Under this agreement
the most restrictive financial covenants are (a) maintain, on a
consolidated basis, working capital of not less than $6,000,000 through
December 31, 1996, $6,500,000 through December 31, 1997 and $7,000,000
after January 1, 1998; (b) the maintenance of minimum adjusted tangible
net worth, as defined of at least $8,750,000 through May 31, 1996,
$9,000,000 through December 31, 1996, $9,500,000 through December 31,
1997 and $10,000,000 after January 1, 1998; (c) achieve domestic cash
flow, as defined, of not less than ($750,000) for the three months
ended March 31, 1996, ($250,000) for the six months ending June 30,
1996, ($1,000,000) for the nine months ending September 30, 1996, and
$0 for the 12 months ending December 31, 1996 and for the 12 months
ending on the last day of each subsequent month; (d) achieve
consolidated cash flow, as defined, of not less than ($850,000) for the
three months ended March 31, 1996, $250,000 for the six months ended
June 30,
7
<PAGE>
1996, $500,000 for the nine months ended September 30, 1996 and
$750,000 for the 12 months ending December 31, 1996 and for the 12
months ending on the last day of each subsequent month.
As of March 31, 1996, the Company was in compliance with the relevant
financial covenants.
The Loan Agreement also provides certain letters of credit facilities
for operations of the Company's foreign subsidiaries.
The Company's lines and letters of credit are subject to acceleration
in the event that there is a material and adverse change in the
condition or affairs, financial or otherwise, of the Company which in
the reasonable opinion of the lender impairs the lender's collateral or
increases its risk so as to jeopardize the repayment of the
obligations.
4. Loss Per Share
Loss per share is computed based on the weighted average number of
common shares outstanding during each period. The loss per share
calculation does not include shares reserved for stock options and
convertible securities since the effects are immaterial or
antidilutive.
5. Long-term Debt and Short-term Borrowings
Long-term debt consists March 31, December 31,
of the following: 1996 1995
Lease obligation from sale/leaseback $ 5,001,000 --
arrangement, 15 year term with interest
imputed at 21%
Mortgage loans payable through -- $ 5,730,000
November 1997, with interest at
prime plus 1/2% 9.0% at
December 31, 1995 and fixed
interest at 9.6%. Mortgage loan
was settled February 23, 1996
as part of financing arrangement
See Item 2 "Financing" _________ _________
5,001,000 5,730,000
Less current maturities 54,000 497,000
_________ _________
$ 4,947,000 $ 5,233,000
========= =========
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS
AND FINANCIAL CONDITION
Results of Operations
Sales for the three months ended March 31, 1996 decreased $605,000 (or
7.0%) compared to the corresponding period in 1995. The decrease
resulted primarily from unfavorable currency rates which had a negative
impact of $416,000 on sales as compared to the year earlier period.
Strong shipments in the fourth quarter of 1995, which reduced the
Company's backlog at January 1, 1996 by $1,700,000 as compared to January
1, 1995 also had a significant impact on the decrease. The decrease in
revenue for the three-month period represents a decrease in American and
European sales of $731,000 and $90,000 respectively, offset by an
increase in the Far East of $216,000. For the three-month period total
international sales of $5,100,000 represented 64% of total sales
compared to last year's three month international sales of $4,974,000,
which represented 58% of total sales.
The gross profit percentage for the three months ended March 31, 1996 was
43.5%, versus 46.7% for the corresponding period in the prior year. The
decrease in gross profit was caused primarily by unfavorable currency
trends.
Operating expenses for the three months ended March 31, 1996 were up
$2,307,000 compared to the corresponding period in the prior year.
Included in this total increase is a loss of $2,368,000 on the sale and
subsequent leaseback of the Piscataway facility. This loss was offset by
favorable currency rates as well as the capitalization of software
development costs amounting to $84,000 and $43,000, respectively.
Net interest expense for the three months ended March 31, 1996 decreased
$28,000 as compared to the corresponding period in the prior year.
The foreign currency loss for the three months ended March 31, 1996 of
$92,000 was due primarily to unrealized translation losses resulting from
the Japanese Yen, German Mark, and British Pound against the Dollar,
which were offset by an unrealized gain in Swiss Francs resulting from
the Mettler agreement. The foreign currency gains of $235,000 for the
three months ended March 31, 1995 were due primarily to unrealized
translation gains resulting from the French Franc, German Mark, Japanese
Yen and British Pound offset by an unrealized loss in Swiss Francs.
Inherent in the Company's business is the potential for inventory
obsolescence for older products as the Company develops new products.
Obsolescence has historically related to parts inventory. The Company
continuously monitors its exposure relating to excess and obsolete
inventory and establishes appropriate valuation reserves. The Company's
development efforts generally enhance existing products or relate to new
markets for existing technology and, therefore, existing products are
generally not rendered obsolete.
9
<PAGE>
The Financial Accounting Standards Board issued Statement of Accounting
Standards No. 121, "Accounting for the Impairment of Long-Lived Assets
and for Long-Lived Assets to be Disposed Of" ("FAS 121") in March 1995.
FAS 121 requires companies to review their long-lived assets and certain
identifiable intangibles (collectively, "Long-Lived Assets") for
impairment whenever events or changes in circumstances indicate that the
carrying value of a Long-Lived asset may not be recoverable. Impairment
is measured using the lower of a Long-Lived Asset's book value or fair
value, as defined. The adoption of FAS 121 does not have a material
impact on the Company's financial position or results of operations.
Liquidity and Capital Resources
Management believes that cash generated from operations, funds available
under lines of credit, funds received from Axess's investments, and funds
received under its current loan agreement should be sufficient to meet
the Company's working capital needs for the remainder of the fiscal year.
Adequacy of cash flows beyond 1996 will depend upon the Company's ability
to achieve expected sales volumes to support profitable operations.
Cash Flows from Operations. Net cash provided by operating activities for
the quarter ended March 31, 1996 was $2,378,000, an increase of $2,203,000
over the same period last year. During the quarter accounts receivable
declined by $3,146,000 reflecting lower sales in the first quarter of 1996
as compared to the last quarter of 1996. Throughout the first quarter
inventory levels were replenished in anticipation of historical sales
demand in the second quarter, causing an increase in inventory and accounts
payable of $1,151,000 and $629,000, respectively. The first quarter 1996
loss of $3,548,000 includes a non-cash charge of $2,301,000 resulting from
the sale of the Facility.
Cash Flows From Investing. Net cash used in investing activities during
the quarter ended March 31, 1996 was $47,000, an increase of $31,000
over the corresponding period last year.
Cash Flows From Financing. Net cash used in financing during the quarter
ended March 31, 1996 was $1,005,000 an increase of $1,046,000 over last
year. This increase includes the repayment of the existing mortgage of
$5,730,000 and a participating interest in the mortgage facility of
$861,000, offset by the net proceeds from the sale/leaseback arrangement
of $5,734,000.
The Company and Axess executed various subordinated term loans during
the years ended December 31, 1993, 1994, and 1995 aggregating
$5,740,000. On February 23, 1996, Axess and the Company consolidated
all of the outstanding notes and deferred interest amounting to
$517,972 into a new subordinated note for an aggregate amount of
$6,257,972. The new note bears interest at 12% payable monthly and is
due February 28, 1999.
On March 7 and 25, 1994, Axess and the Company's UK subsidiary,
executed subordinated term notes of $150,000 and $225,000,
respectively, due January 1, 1996, bearing interest at a rate equal
10
<PAGE>
to the British Prime Rate plus 1.5% (7.75% and 8.25% at December 31,
1995 and 1994, respectively). On March 6, 1996, these subordinated
term notes were paid in full, including interest of $27,417, for an
aggregate amount of $402,417.
The Company has working capital lines of credit with certain domestic
and foreign banks aggregating $7,683,000 of which approximately
$1,138,000 was available at March 31, 1996.
Financing
On February 23, 1996, the Company entered into a sale/leaseback
arrangement which is recorded as a financing whereby the Company sold the
Company's corporate headquarters and main manufacturing facility, and the
19 acres of real property on which the facility is located (the facility
and the real estate being referred to herein as the "Facility") for
$6,300,000. Simultaneously with the sale to the Landlord, the Company
entered into a long-term lease of the Facility from the Landlord. The
initial term of the lease is 15 years, subject to automatic five-year
extensions through 2026. Under the terms of the lease, the Company has
certain rights of first refusal to purchase the Facility and the right to
acquire up to 11 acres of undeveloped real estate constituting a portion
of the facility (the "Excess Land") under certain circumstances.
Simultaneously with the consummation of the sale/leaseback arrangement,
the Company entered into a Loan and Security Agreement providing for a
working capital revolving credit facility in the amount of $11,500,000.
The amount of available credit is determined by the level of certain
eligible receivables and inventory. The Company's obligations under the
Loan Agreement are collateralized by substantially all of the Company's
assets.
The Landlord financed the acquisition of the Facility in part through a
$3,300,000 mortgage loan. The Company purchased a participating
interest in the Landlord's mortgage loan (the "Mortgage Loan") in the
amount of $861,000. The Company's interest in the Mortgage Loan will be
repaid with yearly interest of 9.625% upon the maturity of the Mortgage
Loan in five years or upon refinancing.
Further, in connection with the sale/leaseback arrangement, the Company
issued the following three warrants to acquire shares of its Common
Stock, all having an exercise price of $2.00 per share: (1) a warrant to
the Landlord to purchase 132,617 shares of Common Stock of the Company,
exercisable during the term of the lease; (2) a conditional warrant to
the Landlord to purchase 331,543 shares of Common Stock of the Company
which shall only be exercisable if the indebtedness owed by Landlord
under the Mortgage Loan is repaid prior to February 23, 1997; or if the
Landlord is unable to refinance the indebtedness owed under the Mortgage
Loan prior to February 23, 1997, solely as a result of environmental
contamination relating to the 11 acres of undeveloped real estate
constituting a portion of the facility (the "Excess Land"); and (3) a
conditional warrant to the Landlord's Lender (the "Lender") to purchase
331,543 shares of Common Stock which shall only be
11
<PAGE>
exercisable if the indebtedness owed under the Mortgage Loan by Landlord
to Lender is not refinanced prior to February 23, 1997.
A portion of the proceeds from the sale of the Facility and the Loan
Agreement were used to provide the funds necessary to repay the Company's
mortgage indebtedness of approximately $5,700,000 and existing line of
credit of approximately $3,000,000.
As a result of the sale/leaseback arrangement of the Facility, the
Company recognized a loss of $2,368,000 in the first quarter because the
proceeds of the financing were less than the carrying value of the
Facility. The issuance of $733,373 of warrants and the recording of the
lease obligation of $5,001,000 are considered non-cash transactions for
cash flow statement purposes.
The Loan Agreement is for a term of three years. Under this agreement
the most restrictive financial covenants are (a) maintain, on a
consolidated basis, working capital of not less than $6,000,000 through
December 31, 1996, $6,500,000 through December 31, 1997 and $7,000,000
after January 1, 1998; (b) the maintenance of minimum adjusted tangible
net worth, as defined of at least $8,750,000 through May 31, 1996,
$9,000,000 through December 31, 1996, $9,500,000 through December 31,
1997 and $10,000,000 after January 1, 1998; (c) achieve domestic cash
flow, as defined, of not less than ($750,000) for the three months ended
March 31, 1996, ($250,000) for the six months ending June 30, 1996,
($1,000,000) for the nine months ending September 30, 1996, and $0 for
the 12 months ending December 31, 1996 and for the 12 months ending on
the last day of each subsequent month; (d) achieve consolidated cash
flow, as defined, of not less than ($850,000) for the three months ended
March 31, 1996, $250,000 for the six months ended June 30, 1996, $500,000
for the nine months ended September 30, 1996 and $750,000 for the 12
months ending December 31, 1996 and for the 12 months ending on the last
day of each subsequent month.
As of March 31, 1996, the Company was in compliance with the relevant
financial covenants.
The Loan Agreement also provides certain letters of credit facilities for
operations of the Company's foreign subsidiaries.
The Company's lines and letters of credit are subject to acceleration in
the event that there is a material and adverse change in the condition or
affairs, financial or otherwise, of the Company which in the reasonable
opinion of the lender impairs the lender's collateral or increases its
risk so as to jeopardize the repayment of the obligations.
12
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
27 Financial Data Schedule
(b) Reports on Form 8-K:
On March 8, 1996, a Current Report on Form 8-K was filed
with regard to the sale/leaseback arrangement and security and loan
agreement signed on February 23, 1996 whereby the Company sold the
Company's corporate headquarters and main manufacturing facility, and
the 19 acres of real property on which the facility is located and
simultaneously entered into a long-term lease for the facility.
Simultaneously with the consummation of the sale/leaseback arrangement,
the Company entered into a Loan and Security Agreement providing for a
working capital revolving credit facility in the amount of $11,500,000.
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.
RHEOMETRIC SCIENTIFIC, INC.
(Registrant)
May 21, 1996 By /s/ J C Fuhrmeister
John C. Fuhrmeister
Vice President and
Chief Financial Officer
13
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000779164
<NAME> RHEOMETRIC SCIENTIFIC
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 2,663
<SECURITIES> 0
<RECEIVABLES> 11,088
<ALLOWANCES> 0
<INVENTORY> 11,729
<CURRENT-ASSETS> 24,174
<PP&E> 19,046
<DEPRECIATION> 11,724
<TOTAL-ASSETS> 36,661
<CURRENT-LIABILITIES> 16,725
<BONDS> 10,687
13
0
<COMMON> 0
<OTHER-SE> 7,963
<TOTAL-LIABILITY-AND-EQUITY> 36,661
<SALES> 7,996
<TOTAL-REVENUES> 7,996
<CGS> 4,517
<TOTAL-COSTS> 4,517
<OTHER-EXPENSES> 6,541
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 391
<INCOME-PRETAX> (3,545)
<INCOME-TAX> (3)
<INCOME-CONTINUING> (3,548)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,548)
<EPS-PRIMARY> (0.27)
<EPS-DILUTED> (0.27)
</TABLE>
