SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1997
[ ] 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 1-8191
PORTA SYSTEMS CORP.
(Exact name of registrant as specified in its charter)
Delaware 11-2203988
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
575 Underhill Boulevard, Syosset, New York
(Address of principal executive offices)
11791
(Zip Code)
516-364-9300
(Company'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 of 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:
Common Stock (par value $0.01) 2,191,896 shares as of August 7, 1997
Page 1 of 13 pages
<PAGE>
PART I.- FINANCIAL INFORMATION
Item 1- Financial Statements
PORTA SYSTEMS CORP. AND SUBSIDIARIES
Consolidated Balance Sheets
(Dollars in thousands)
June 30, December 31,
1997 1996
-------- --------
Assets (Unaudited)
Current assets:
Cash and cash equivalents $ 4,277 $ 2,584
Accounts receivable, net 15,852 16,034
Inventories 8,561 7,424
Prepaid expenses 663 782
Other receivable -- 531
-------- --------
Total current assets 29,353 27,355
-------- --------
Property, plant and equipment, net 4,935 5,422
Deferred computer software, net 1,122 1,676
Goodwill, net 11,330 11,555
Other assets 3,658 4,650
-------- --------
Total assets $ 50,398 $ 50,658
======== ========
Liabilities and Stockholders' Deficit
Current liabilities:
Convertible subordinated debentures $ 2,079 $ 2,096
Zero coupon senior subordinated convertible notes 25,916 --
Current portion of senior debt 1,922 750
Accounts payable 6,309 6,056
Accrued expenses 9,047 9,004
Accrued interest payable 713 583
Accrued commissions 2,319 2,708
Income taxes payable 780 780
Accrued deferred compensation 1,154 1,232
Short-term loans 70 31
-------- --------
Total current liabilities 50,309 23,240
-------- --------
Senior debt 14,840 16,835
Zero coupon senior subordinated convertible notes -- 25,885
Notes payable net of current maturities 3,084 3,084
Income taxes payable 719 802
Other long-term liabilities 485 653
Minority interest 849 863
-------- --------
Total long-term liabilities 19,977 48,122
-------- --------
Stockholders' deficit:
Preferred stock, no par value; authorized
1,000,000 shares, none issued -- --
Common stock, par value $.01; authorized
40,000,000 shares, issued 2,225,230 and
2,223,861 shares at June 30, 1997
and December 31,1996, respectively 22 22
Additional paid-in capital 36,724 36,561
Foreign currency translation adjustment (4,216) (4,014)
Accumulated deficit (50,045) (50,900)
-------- --------
(17,515) (18,331)
Treasury stock, at cost (2,066) (2,066)
Receivable for employee stock purchases (307) (307)
-------- --------
Total stockholders' deficit (19,688) (20,704)
-------- --------
Total liabilities and stockholders'
deficit $ 50,398 $ 50,658
======== ========
See accompanying notes to consolidated financial statements.
Page 2 of 13 pages
<PAGE>
PORTA SYSTEMS CORP. AND SUBSIDIARIES
Unaudited Consolidated Statements of Operations
(In thousands, except per share data)
Six Months Ended
June 30, June 30,
1997 1996
-------- --------
Sales $ 28,874 $ 26,863
Cost of sales 18,095 17,744
-------- --------
Gross profit 10,779 9,119
Selling, general and administrative expenses 5,892 6,187
Research and development expenses 2,488 1,804
-------- --------
Total expenses 8,380 7,991
-------- --------
Operating income 2,399 1,128
Interest expense (1,840) (3,226)
Interest income 92 42
Gain on sale of assets -- 2,264
Other income 202 18
-------- --------
Income before income taxes, minority
interest and extraordinary item 853 226
Income tax expense (23) (6)
Minority interest 15 233
-------- --------
Income before extraordinary item 845 453
Extraordinary item 11 3,390
-------- --------
Net income $ 856 $ 3,843
======== ========
Per share data:
Income before extraordinary item $ 0.14 $ 0.10
Extraordinary item 0.00 0.80
-------- --------
Net income $ 0.14 $ 0.90
======== ========
Weighted average shares outstanding 6,251 4,249
======== ========
See accompanying notes to unaudited consolidated financial statements.
Page 3 of 13 pages
<PAGE>
PORTA SYSTEMS CORP. AND SUBSIDIARIES
Unaudited Consolidated Statements of Operations
(In thousands, except per share data)
Three Months Ended
June 30, June 30,
1997 1996
-------- --------
Sales $ 16,394 $ 13,642
Cost of sales 9,629 8,861
-------- --------
Gross profit 6,765 4,781
Selling, general and administrative expenses 3,305 2,775
Research and development expenses 1,337 933
-------- --------
Total expenses 4,642 3,708
-------- --------
Operating income 2,123 1,073
Interest expense (924) (1,048)
Interest income 50 33
Gain on sale of assets -- 2,264
Other income 67 169
-------- --------
Income before income taxes, minority interest
and extraordinary item 1,316 2,491
Income tax benefit (expense) (9) 7
Minority interest 60 123
-------- --------
Income before extraordinary item 1,247 2,621
Extraordinary item 3 357
-------- --------
Net income $ 1,250 $ 2,978
======== ========
Per share data:
Income before extraordinary item $ 0.20 $ 0.54
Extraordinary item 0.00 0.07
-------- --------
Net income $ 0.20 $ 0.61
======== ========
Weighted average shares outstanding 6,288 4,854
======== ========
See accompanying notes to unaudited consolidated financial statements.
Page 4 of 13 pages
<PAGE>
PORTA SYSTEMS CORP. AND SUBSIDIARIES
Unauditied Consolidated Statements of Cash Flows
(In thousands)
Six Months Ended
June 30, June 30,
1997 1996
-------- --------
Cash flows from operating activities:
Net income $ 856 $ 3,843
Adjustments to reconcile net income to
net cash provided by (used in)
operating activities:
Gain on sale of assets -- (2,264)
Extraordinary gain (11) (3,390)
Non-cash financing expenses 184 1,799
Non-cash operating expenses 13 --
Depreciation and amortization 1,582 2,237
Amortization of discount on convertible
subordinated debentures 20 63
Minority interest 14 (233)
Changes in assets and liabilities:
Accounts receivable 182 (666)
Inventories (1,137) 802
Prepaid expenses 119 (69)
Other receivables 31 --
Deferred computer software (13) (38)
Other assets 865 (359)
Accounts payable, accrued expenses
and other liabilities (285) (2,851)
------- -------
Net cash provided by (used in)
operating activities 2,420 (1,126)
------- -------
Cash flows from investing activities:
Proceeds from disposal of assets held for sale, net 500 6,793
Proceeds from sale of assets -- 3,456
Capital expenditures (216) (292)
------- -------
Net cash provided by investing activities 284 9,957
------- -------
Cash flows from financing activities:
Proceeds from long-term debt 299 1,330
Repayments of long-term debt (1,122) (9,959)
(Repayments of) proceeds from notes payable
and short term loans 39 (118)
------- -------
Net cash used in financing activities (784) (8,747)
------- -------
Effect of exchange rates on cash (227) (144)
------- -------
Increase (decrease) in cash and cash equivalents 1,693 (60)
Cash and equivalents - beginning of the year 2,584 1,109
------- -------
Cash and equivalents - end of the period $ 4,277 $ 1,049
======= =======
Supplemental cash flow disclosures:
Cash paid for interest expense $ 1,399 $ 1,391
======= =======
Cash paid for income taxes $ 45 $ 29
======= =======
See accompanying notes to unaudited consolidated financial statements.
Page 5 of 13 pages
<PAGE>
NOTES TO UNAUDITIED CONSOLIDATED FINANCIAL STATEMENTS
Note 1: Management's Responsibility For Interim Financial Statements Including
All Adjustments Necessary For Fair Presentation
Management acknowledges its responsibility for the preparation of the
accompanying interim consolidated financial statements which reflect all
adjustments, consisting of normal recurring adjustments, considered necessary in
its opinion for a fair statement of its consolidated financial position and the
results of its operations for the interim periods presented. These consolidated
financial statements should be read in conjunction with the summary of
significant accounting policies and notes to consolidated financial statements
included in the Company's annual report to stockholders for the year ended
December 31, 1996. Results for the first six months of 1997 are not necessarily
indicative of results for the year.
Note 2: Inventories
Inventories are valued at lower of cost or market. Inventory costs at June
30, 1997 have been computed using a standard cost system. The composition of
inventories at the end of the respective periods is as follows:
June 30, December 31,
1997 1996
------------ ------------
(in thousands)
Parts and components $6,170 $4,557
Work-in-process 1,027 515
Finished goods 1,364 2,352
------ ------
$8,561 $7,424
====== ======
Note 3: 6% Convertible Subordinated Debentures and
Zero Coupon Senior Subordinated Convertible Notes
As of June 30, 1997, the Company had outstanding $2,079,000 of its 6%
Convertible Subordinated Debentures due July 1, 2002 ("the Debentures"), net of
original issue discount amortized to principal over the term of the debt using
the effective interest rate method, of $186,000. The face amount of the
outstanding Debentures was $2,265,000 at June 30, 1997.
Interest on the Debentures is payable on July 1 of each year. The interest
accrued as of June 30, 1997 amounted to $531,000. As of June 30, 1997 the
Company is in default under the provisions of the Debentures.
As of June 30, 1997, the Company had exchanged approximately $33,810,000
principal amount of the Debentures, net of unamortized discount and accrued
interest expense for 655,900 shares of the Company's common stock and
$25,940,000 of Zero Coupon Senior Subordinated Convertible Notes ("the Notes").
As of June 30, 1997, $25,916,000 of Notes are outstanding after the conversion
of $24,000 of principal Notes to common stock.
Page 6 of 13 pages
<PAGE>
Note 3: 6% Convertible Subordinated Debentures and
Zero Coupon Senior Subordinated Convertible Notes (continued)
The exchange of the Debentures for the Notes and common stock was accounted
for as a troubled debt restructuring in accordance with Statement of Financial
Accounting Standards No. 15. Since the future principal and interest payments
under the Notes is less than the carrying value of the Debentures, the Notes
were recorded for the amount of the future cash payments, and not discounted. In
addition, no future interest expense will be recorded on the exchanged Notes. As
a result of the exchange, the Company recognized an extraordinary gain of $3,000
and $357,000 for the three months ended June 30, 1997 and 1996, and $11,000 and
$3,390,000 for the six months ended June 30, 1997 and 1996, receptively.
Note 4: Senior Debt
On June 30, 1997, the Company's senior debt under its credit facility
consisted of $16,762,000. The credit facility is secured by substantially all of
the Company's assets. All obligations except undrawn letters of credit, letter
of credit guarantees and the deferred fee notes bear interest at 12% per annum.
The Company incurs an annual fee of 2% on the average balance of undrawn letters
of credit and letter of credit guarantees outstanding. In addition, the Company
is obligated to pay a monthly facility fee of $50,000. The loan agreement
requires a minimum quarterly amortized payment of $250,000 commencing for the
quarter ending June 30, 1997, increasing to $325,000 for the quarter ending
March 31, 1998 and for the quarters thereafter during the term of the agreement,
as well as an additional principal payment if cash flow exceeds certain amounts.
Based on these required principal payments, $1,922,000 has been classified as a
current liability at June 30, 1997.
Financial debt covenants include an interest coverage ratio measured
quarterly, limitations on the incurrence of indebtedness, limitations on capital
expenditures, and prohibitions on declarations of any cash or stock dividends or
the repurchase of the Company's stock. As of June 30,1997, the Company is in
compliance with the above covenants.
Page 7 of 13 pages
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The Company's consolidated statements of operations for the periods
indicated below, shown as a percentage of sales, are as follows:
Six Months Three Months
Ended June 30, Ended June 30,
-------------- --------------
1997 1996 1997 1996
---- ---- ---- ----
Sales 100% 100% 100% 100%
Cost of Sales 63% 66% 59% 65%
Gross Profit 37% 34% 41% 35%
Selling, general and administrative expenses 20% 23% 20% 20%
Research and development expenses 9% 7% 8% 7%
Operating income 8% 4% 13% 8%
Interest expense - net (6%) (12%) (5%) (8%)
Other income (expense) 1% 8% 0% 18%
Minority interest 0% 1% 0% 1%
Extraordinary item 0% 13% 0% 3%
Net income 3% 14% 8% 22%
The Company's sales by product line for the periods ended June 30, 1997 and
1996 are as follows:
Six Months Ended
June 30,
------------------------
1997 1996
---- ----
(Dollars in thousands)
Line connection/protection
equipment ("Line connection")* $13,347 46% $12,705 47%
Operations Support Systems ("OSS") 11,302 39% 10,633 40%
Signal Processing 3,942 14% 3,377 12%
Other 283 1% 148 1%
------------- --------------
$28,874 100% $26,863 100%
============= ==============
Three Months Ended
June 30,
-------------------------
1997 1996
---- ----
(Dollars in thousands)
Line connection $ 6,552 40% $ 6,908 51%
OSS 7,310 45% 4,733 35%
Signal Processing 2,339 14% 1,940 14%
Other 193 1% 61 0%
------------- --------------
$16,394 100% $13,642 100%
============= ==============
*Includes sales of fiber optics products of $0 and $452,000 for the six months
ended June 30, 1997 and 1996, respectively. There were no sales of fiber optic
products for either the three months ended June 30, 1997 or 1996.
Page 8 of 13 pages
<PAGE>
Results of Operations
The Company's sales for the six months ended June 30, 1997 compared to the
six months ended June 30, 1996 increased $2,011,000 (7%) from $26,863,000 in
1996 to $28,874,000 in 1997 and sales for the quarter ended June 30, 1997 of
$16,394,000 increased by $2,752,000 (20%) compared to $13,642,000 for the
quarter ended June 30, 1996. The increased sales for both the six and three
months is due to higher revenue from the OSS and Signal Processing divisions.
OSS revenue for the six and three months ended June 30, 1997 was
$11,302,000 and $7,310,000, respectively, compared to the six and three months
ended June 30, 1996 of $10,633,000 and $4,733,000, respectively, an increase of
$669,000 (6%) and $2,577,000 (54%) for the six and three month periods,
respectively. The increased sales relates primarily to higher revenues generated
from the installation of the OSS systems and our Korean joint venture.
The line connection sales for the six months ended June 30 increased from
$12,705,000 to $13,347,000 or $642,000 (5%) from 1996 to 1997. Sales for the
three months ended June 30, decreased by $356,000 (5%) from $6,908,000 in 1996
to $6,552,000 in 1997. These fluctuations are not considered significant.
Signal Processing sales for the six and three months ended June 30, 1997
were $3,942,000 and $2,339,000, respectively, compared to the six and three
months ended June 30, 1996 of $3,377,000 and $1,940,000, an increase of $565,000
(17%) and $399,000 (21%) from 1996 to 1997, respectively. The increased revenue
was generated from the earlier than anticipated completion of certain military
orders.
Cost of sales for the six months and the quarter ended June 30, 1997, as a
percentage of sales compared to the same periods of 1996, decreased from 66% to
63% and from 65% to 59%, respectively. The improvement in gross margin is
attributed to the Company's continuing effort to increase manufacturing
productivity and the absorption of certain fixed expenses associated with the
OSS contracts.
Selling, general and administration expenses decreased by $295,000 (5%)
from $6,187,000 to $5,892,000 for the six months ended June 30, 1997 compared to
1996. For the six months, the change is not material. For the quarter ended June
30, 1997 and 1996 selling, general and administration expenses increased by
$530,000 (19%). The increase from the 1996 to the 1997 quarter results primarily
from the Company's efforts to increase its sales and marketing effectiveness in
order to secure future business, and to a lesser extent, higher commissions
associated with the increased revenues for the quarter.
Research and development expenses increased by $684,000 (38%) and by
$404,000 (43%) for the six and three months ended June 30, 1997 from the
comparable periods in 1996, respectively. The increased expenses results from
the Company's efforts to develop new products, primarily related to the OSS
business.
As a result of the above, for the six months ended June 30, 1997 compared
to 1996, the Company had operating income of $2,399,000 in 1997 versus
$1,128,000 in 1996. The Company had an operating income of $2,123,000 for the
quarter ended June 30, 1997 as compared to $1,073,000 for the quarter ended June
30, 1996. The Company's operating improvement for the six months and the quarter
ended June 30, 1996, when compared to the comparable periods ended June 30,
1996, were the results of the improved gross margins and its continuing efforts
to maintain costs and expenses at a level appropriate with the current level of
sales.
Page 9 of 13 pages
<PAGE>
Results of Operations (continued)
Interest expense decreased for the six months ended June 30 by $1,386,000
(43%) from $3,226,000 in 1997 to $1,840,000 in 1997. For the quarter ended June
30, interest expense decreased by $124,000 (12%) from $1,048,000 in 1996 to
$924,000 in 1997. This change is attributable primarily to a decrease in
interest expense related to the exchange of the Company's Debentures for the
Notes and common stock which occurred primarily in the first and second quarters
of 1996, and repayment of principal to the Company's senior lender. In addition,
for the six month period ended June 30, 1996, the Company incurred additional
interest expense as a result of the recognition in that period of certain
deferred borrowing costs related to its loans from its senior lender.
The Company had income before extraordinary item of $845,000 and $453,000
for the six months ended June 30, 1997 and 1996, respectively, and income before
extraordinary item of $1,247,000 and $2,621,000 for the three months ended June
30, 1997 and 1996, respectively. During the quarter ended June 30, 1996, the
Company had a gain of $2,264,000 on a sale of assets. If not for this gain,
there would have been a loss before extraordinary item incurred for the six
months ended June 30, 1996 of $1,811,000 and income before extraordinary item
for the three months ended June 30, 1996 of $357,000. The improvement in income
before extraordinary item reflects the increased gross margin coupled with the
reduction of interest expense.
During the six months ended 1997 and 1996, respectively, the Company
recorded an $11,000 and $3,390,000 extraordinary gain from the early
extingushment of Debt as a result of the exchange of the Debentures for the
Notes and common stock. During the three months ended June 30, 1997 and 1996,
respectively, a $3,000 and $357,000 extraordinary gain was recorded as a result
of such conversions.
As the result of the foregoing the Company generated net income of
$856,000, $0.14 per share for the six months ended June 30, 1997 compared with
net income of $3,843,000, $0.90 per share, for the six months ended June 30,
1996 and net income for the quarter ended June 30, 1997 of $1,250,000, $0.20 per
share, compared with net income for the quarter ended June 30, 1996 of
$2,978,000, $0.61 per share. The calculation of the weighted average shares, for
the period and quarter ended June 30, 1997, assumes the conversion of the Notes
which are considered to be a common stock equivalent.
Page 10 of 13 pages
<PAGE>
Liquidity and Capital Resources
The Company had income from continuing operations for the six and three
months ended June 30, 1997. These results notwithstanding, the Company will be
required to refinance or restructure certain existing notes payable which become
due on January 2, 1998 as discussed in the following paragraph. This factor
continues to raise substantial doubt about the Company's ability to continue as
a going concern. Furthermore, the unaudited consolidated financial statements do
not include any adjustments that might result from the inability of the Company
to refinance or restructure such notes.
At June 30, 1997 the Company had cash and cash equivalents of $4,277,000
compared with $2,584,000 at December 31, 1996. The Company's working capital
deficit at June 30, 1997 was $20,956,000, compared to working capital of
$4,115,000 at December 31, 1996. At June 30, 1997, $25,916,000 of the Notes,
which are due on January 2, 1998, are classified as current liabilities. At June
30, 1997 the Company does not have sufficient resources to pay the Notes when
they mature and it is likely that it cannot generate such cash from its
operations or from its existing credit facilities. Although the Company is
seeking to refinance or restructure the Notes, no assurance can be given that it
will be successful in these efforts. If the Company is unable to refinance or
restructure the Notes or the holders of the Notes do not convert such Notes to
common stock, the Company's liquidity may be severely impaired and the Company's
business may be materially and adversely affected.
At June 30, 1997, the Company's senior debt to its senior secured lender,
Foothill Capital Corporation ("Foothill"), consisted of a credit facility in the
amount of $16,762,000 of which approximately $15,915,000 and $847,000 relates to
the term loan and the revolving line of credit, respectively. The agreement
provides for (i) the repayment of loan principal of $750,000 in 1997, (ii) the
repayment of loan principal of $325,000 each quarter commencing March 31, 1998
and thereafter during the term of the agreement, (iii) the Company to pay
additional principal payments if certain "adjusted cash flow amounts", as
defined, exceed certain amounts, and (iv) the Company to pay a monthly facility
fee of $50,000. For the quarter ended June 30, 1997 the additional principal
payment based upon the "adjusted cash flow" amounts to $522,000. As of June 30,
1997, the Company's availability under its $2,000,000 revolving line of credit
is approximately $1,153,000.
As of June 30, 1997, the Company had remaining outstanding $2,079,000 of
the Debentures, net of original issue discounts amortized to principal over the
term of the debt using the effective interest rate method, of $186,000. The face
amount of the outstanding Debentures was $2,265,000. Interest on the Debentures
is payable on July 1 of each year. The interest accrued as of June 30, 1997
amounted to $531,000. As of June 30, 1997 the Company is in default under the
provisions of the Debentures. Accordingly, such debt has been classified as a
current liability at June 30, 1997.
Page 11 of 13 pages
<PAGE>
PART II- OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders.
The Company's 1997 Annual Meeting of Stockholders was held on July 31,
1997. At the annual meeting, the stockholders (i) reelected its present board,
consisting of Messrs. William V. Carney, Seymour Joffe, Michael A. Tancredi,
Howard D. Brous, Warren H. Esanu, Herbert H. Feldman, Stanley Kreitman, and
Robert Schreiber (ii) approved an amendment to the 1996 Stock Option Plan which,
among other things, increases the number of shares of Common Stock subject to
such plan from 100,000 shares to 450,000 shares (iii) approved an amendment to
its certificate of incorporation to change the authorized capital stock by
decreasing the number of authorized shares of common stock from 40,000,000
shares to 20,000,000 shares and (iv) ratified the appointment of BDO Seidman,
LLP as independent auditors for the year ended December 31, 1997.
Each director received at least 1,777,194 votes for his election. Set forth
below is the vote on the other matters approved at the meeting.
Votes Broker
Matter Votes for Against Abstentions Non-Votes
------ --------- ------- ----------- ---------
Amendment to
1996 Stock Option Plan 780,964 317,116 27,237 904,600
Amendment to
Certificate of Incorporation 1,856,123 161,836 11,958
Appointment of
Auditors 1,988,631 34,931 6,355
Page 12 of 13 pages
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
PORTA SYSTEMS CORP.
Dated August 12, 1997 By /s/William V. Carney
--------------------
William V. Carney
Chairman of the Board
Dated August 12, 1997 By /s/Edward B. Kornfeld
---------------------
Edward B. Kornfeld
Senior Vice President
and Chief Financial Officer
Page 13 of 13 pages
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<CASH> 4,227
<SECURITIES> 0
<RECEIVABLES> 15,852
<ALLOWANCES> 0
<INVENTORY> 8,561
<CURRENT-ASSETS> 29,353
<PP&E> 4,935
<DEPRECIATION> 0
<TOTAL-ASSETS> 50,398
<CURRENT-LIABILITIES> 50,309
<BONDS> 0
0
0
<COMMON> 22
<OTHER-SE> (19,666)
<TOTAL-LIABILITY-AND-EQUITY> 50,398
<SALES> 28,874
<TOTAL-REVENUES> 28,874
<CGS> 18,095
<TOTAL-COSTS> 8,380
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,840
<INCOME-PRETAX> 853
<INCOME-TAX> 23
<INCOME-CONTINUING> 845
<DISCONTINUED> 0
<EXTRAORDINARY> 11
<CHANGES> 0
<NET-INCOME> 856
<EPS-PRIMARY> 0.14
<EPS-DILUTED> 0.14
</TABLE>