U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
1934 FOR THE QUARTERLY PERIOD ENDED DECEMBER 31, 1995.
Commission File No. 0-15205
ELCOTEL, INC.
(Exact name of small business issuer in its charter)
Delaware 59-2518405
------------------------------ ------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
6428 Parkland Drive, Sarasota, Florida 34243
--------------------------------------------
(Address of principal executive offices)
(941) 758-0389
---------------------------
(Issuer's telephone number)
Not Applicable
- ---------------------------------------------------------------------
(Former name, former address and former fiscal year, if changed since
last report)
Check whether the issuer (1) filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
past 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
----- -----
The number of shares of the issuer's Common Stock outstanding as of
February 9, 1996 was 7,928,590.
<PAGE>
<TABLE>
PART I - FINANCIAL INFORMATION
-------------------------------
ELCOTEL, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
<CAPTION>
December 31, March 31,
1995 1995
------------- -------------
(Unaudited) (See Note)
<S> <C> <C>
ASSETS
CURRENT ASSETS
Cash and temporary investments $100 $366
Accounts receivable, net 4,142 2,809
Notes receivable 3,072 3,289
Inventories 3,103 2,354
Refundable income taxes 177 177
Deferred tax asset 636 636
Prepaid exp. and other current assets 115 296
------- -------
TOTAL CURRENT ASSETS 11,345 9,927
Property, plant and equipment, net 3,153 3,188
Notes receivable, noncurrent 893 2,695
Deferred tax asset 339 339
Other assets 126 76
------- -------
$15,859 $16,225
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued expenses $1,991 $2,860
Line of credit 955 1,425
Current portion of long-term debt 866 67
------- -------
TOTAL CURRENT LIABILITIES 3,812 4,352
------- -------
LONG TERM DEBT, less current portion 592 782
------- -------
SHAREHOLDERS' EQUITY:
Common Stock 79 77
Additional paid-in capital 10,204 9,966
Retained earnings 1,349 1,225
Less treasury stock (177) (177)
------- -------
11,455 11,091
------- -------
$15,859 $16,225
======= =======
<N>
Note: The balance sheet at March 31, 1995, has been derived from
the audited consolidated financial statements.
1
See Notes to Condensed Consolidated Financial Statments.
</TABLE>
<PAGE>
<TABLE>
ELCOTEL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(Unaudited)
<CAPTION>
Three Months Ended Nine Months Ended
December 31, December 31,
------------------ -------------------
1995 1994 1995 1994
------ ------ ------ ------
<S> <C> <C> <C> <C>
NET SALES $5,069 $6,788 $16,373 $18,956
------ ------ ------- -------
COSTS AND EXPENSES:
Cost of sales 3,259 4,109 9,841 11,052
Research and development 587 463 1,651 1,272
Selling, general and
administrative 1,764 1,404 4,908 4,233
------ ------ ------- -------
TOTAL COSTS AND EXPENSES 5,610 5,976 16,400 16,557
------ ------ ------- -------
PROFIT/(LOSS) FROM OPERATIONS (541) 812 (27) 2,399
INTEREST INCOME, net 30 88 218 217
------ ------ ------- -------
PROFIT/(LOSS) BEFORE INCOME TAXES (511) 900 191 2,616
INCOME TAX/(BENEFIT) PROVISION (179) 107 67 458
------ ------ ------- -------
NET PROFIT/(LOSS) $(332) $793 $124 $2,158
====== ====== ======= =======
NET PROFIT/(LOSS) PER COMMON
AND COMMON EQUIVALENT SHARE ($0.04) $0.10 $0.02 $0.28
====== ====== ======= =======
WEIGHTED AVERAGE NUMBER OF
COMMON AND COMMON EQUIVALENT
SHARES OUTSTANDING 8,280 7,760 8,239 7,778
====== ====== ======= =======
<FN>
2
See Notes to Condensed Consolidated Financial Statements
</TABLE>
<PAGE>
<TABLE>
ELCOTEL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOW
(in thousands)
(Unaudited)
<CAPTION>
Nine Months Ended
December 31,
--------------------------
1995 1994
------- -------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Profit $124 $2,158
Adjustments to reconcile net profit
to net cash used in operations:
Depreciation and amortization 251 191
Provision for doubtful accounts 357 77
Change in operating assets and liabilities:
Accounts receivable (1,690) (1,894)
Notes receivable, trade 2,019 (1,633)
Deposits - 9
Inventories (749) (298)
Prepaid expenses and other
current assets 181 459
Accounts payable and accrued expenses (869) 416
Other, net (53) (28)
------- -------
Net cash flow used in operations (429) (543)
------- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to property, plant and equipment (216) (423)
------- -------
Net cash flow used in investing activities (216) (423)
<FN>
3
</TABLE>
<PAGE>
<TABLE>
ELCOTEL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOW
(in thousands)
(Unaudited)
(continued)
<CAPTION>
Nine Months Ended
December 31,
--------------------------
1995 1994
------- -------
<S> <C> <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
Payments on short-term borrowings (470) -
Proceeds from long-term borrowings 609 (117)
Issuance of common stock 240 833
------- -------
Net cash flow provided by
financing activities 379 716
------- -------
Net decrease in cash
and temporary investments (266) (250)
Cash and temporary investments at
beginning of year 366 547
------- -------
Cash and temporary investments at
end of quarter $100 $297
======= =======
ADDITIONAL CASH FLOW INFORMATION:
Cash paid during the period for:
Interest $113 $105
Income taxes 212 475
<FN>
4
See Notes to Condensed Consolidated Financial Statements
</TABLE>
<PAGE>
ELCOTEL, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands, except for share amounts)
(Unaudited)
NOTE A. CONDENSED CONSOLIDATED FINANCIAL STATEMENTS:
The condensed consolidated balance sheet as of December 31, 1995, and
the consolidated statements of operations for the three and nine
month periods ended December 31, 1995 and 1994, and the consolidated
statements of cash flows for the nine month periods ended December 31, 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 at
December 31, 1995, and 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 condensed or omitted. It is
suggested that these condensed consolidated financial statements be
read in conjunction with the consolidated financial statements and
notes thereto included in the Company's Form 10-KSB for the fiscal
year ended March 31, 1995. The results of operations for the three
and nine month periods ended December 31 1995, are not necessarily
indicative of the results for the full fiscal year.
NOTE B. INVENTORIES:
Inventories by stage of completion are as follows:
December 31, March 31,
1995 1995
----------- ----------
Finished products $ 362 $ 407
Work-in-process 891 162
Purchased components 1,850 1,785
------ ------
$3,103 $2,354
====== ======
NOTE C. SHAREHOLDERS' EQUITY:
During the nine month period ended December 31, 1995, shareholders'
equity increased as a result of a net profit of $124, and employee
and director exercise of stock options at prices between $.75 per
share and $3.63 per share for a total of $240.
5
<PAGE>
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operation.
---------------------------------------------
Results of Operations
- ----------------------
(Dollars in thousands)
Quarter ended December 31, 1995, compared to the quarter ended
December 31, 1994:
Net sales for the quarter ended December 31, 1995 ("third quarter
1996"), decreased to $5,069 from $6,788 for the quarter ended
December 31, 1994 ("third quarter 1995"), a decrease of $1,719, or
approximately 25%, principally as a result of a decrease in sales of
electronic assemblies of approximately 9% and a decrease in sales of
complete payphones of approximately 45%. Unit sales of electronic
assemblies decreased by approximately 10% and unit sales of complete
payphones decreased by approximately 51%. The decrease in sales was
due to a combination of adverse weather in December in the
Northeastern United States, restrictive regulations that limit the
number of new payphones in a specific area and imposition of higher
fees in some municipalities which delayed purchases of planned
payphone deliveries, and delays due to software modifications made to
a new coin line payphone. Average selling prices of payphones in the
quarter were approximately 12% higher than in the same quarter last
year, and average selling prices of electronic assemblies were
approximately the same in the comparable quarter last year. In
addition the Company sold upgrade modules which allow customers who
have older versions of the Company's products to comply with the
North American Numbering Plan. Sales of these upgrade modules are
expected to continue throughout the current fiscal year at decreasing
levels toward the latter part of the fiscal year.
Cost of sales as a percentage of net sales increased from 61% for the
third quarter 1995 to 64% for the third quarter 1996, principally as
a result of decreased production and the resulting reduced
manufacturing cost absorption, offset by a lower percentage of
complete payphones sold compared to sales of electronic assembly
products. The Company realizes higher prices but lower margins on
sales of complete payphones than on electronic assembly products
because the cabinets included with the Company's complete telephones
are a significant portion of the total cost of the telephone but are
priced only nominally above cost.
Research and development costs increased by $124, or approximately
27%, from $463 in the third quarter 1995 to $587 in the third quarter
1996 due to the hiring of additional development staff and increased
use of outside contractors. Selling, general and administrative
expenses increased by $360, or approximately 26%, from $1,404 in the
third quarter 1995 to $1,764 in the third quarter 1996 principally as
a result of increased legal fees the Company has incurred related to
the bankruptcy filing by one of its customers, and increased outside
contractor costs for a specific project that was completed in the
quarter. Interest income decreased by $25, or approximately 23%,
from $110 in third quarter 1995 to $85 in the third quarter 1996 due
to a decrease in the Company's note receivable portfolio. Interest
expense increased by $33, or approximately 150%, from $22 in the
third quarter 1995 to $55 in third quarter 1996 due to increased
borrowings against the Company's line of credit facility with its
bank.
The tax benefit in third quarter 1996 of $179, which represents an
effective tax rate of approximately 35%, is compared against the tax
provision in the third quarter 1995 of $107, which was at an
effective tax rate of 12% due to the Company having not recognized
all of its net operating losses in the prior year.
6
<PAGE>
Nine months ended December 31, 1995, compared to the nine months
ended December 31, 1994:
Net sales for the nine months ended December 31, 1995 ("nine-months
1996"), decreased to $16,373 from $18,956 for the nine months ended
December 31, 1994 ("nine-months 1995"), a decrease of $2,583, or
approximately 14%, principally as a result of a decrease in sales of
complete payphones of approximately 36%. Net sales of electronic
assemblies during the nine-months 1996 were approximately the same
as during the nine-months 1995. Unit sales of electronic assemblies
decreased by approximately 3% and unit sales of complete payphones
decreased by approximately 44% due, in part, to a large
international shipment during the nine-months 1995, adverse weather
in December in the Northeastern United States, restrictive
regulations that limit the number of new payphones in a specific area
and imposition of higher fees in some municipalities which delayed
purchases of planned payphone deliveries, and delays due to software
modifications made to a new coin line payphone. Average selling
prices of payphones during the nine-months 1996 were approximately
13% higher than in the same period last year, and average selling
prices of electronic assemblies were approximately 3% higher than in
the same period last year. In addition the Company sold upgrade
modules which allow customers who have older versions of the
Company's products to comply with the North American Numbering Plan.
Sales of these upgrade modules are expected to continue throughout
the current fiscal year at decreasing levels toward the latter part
of the fiscal year.
Cost of sales as a percentage of net sales increased from 58% during
the nine-months 1995 to 60% during the nine-months 1996, principally
as a result of decreased production and the resulting reduced
manufacturing cost absorption, offset by a lower percentage of
complete payphones sold compared to sales of electronic assembly
products. The Company realizes higher prices but lower margins on
sales of complete payphones than on electronic assembly products
because the cabinets included with the Company's complete telephones
are a significant portion of the total cost of the telephone but are
priced only nominally above cost.
Research and development costs increased by $379, or approximately
30%, from $1,272 during the nine-months 1995 to $1,651 during the
nine-months 1996 due to the hiring of additional development staff
and increased use of outside contractors. Selling, general and
administrative expenses increased by $675, or approximately 16%, from
$4,233 during the nine-months 1995 to $4,908 during the nine-months
1996 principally as a result of an increase in the number of
employees supporting international sales efforts, the one-time
expense in connection with the Company's listing on the NASDAQ
National Market System, and increased legal fees the Company has
incurred related to the bankruptcy filing by one of its customers.
Interest income increased by $86, or approximately 30%, from $289
during the nine-months 1995 to $375 during the nine-months 1996 due
to a higher average interest rate the Company received from its note
receivable portfolio. Interest expense increased by $85, or
approximately 118%, from $72 during the nine-months 1995 to $157
during the nine-months 1996 due to increased borrowings against the
Company's line of credit facility with its bank.
The tax provision during the nine-months 1996 of $67, which
represents an effective tax rate of approximately 35%, is compared
against the tax provision during the nine-months 1995 of $458, which
was at an effective tax rate of 18% due to the Company having not
recognized all of its net operating losses in the prior year.
7
<PAGE>
Liquidity and Capital Resources
- -------------------------------
(Dollars in thousands)
The Company recorded an increase in current assets of $1,418, or
approximately 14%, from $9,927 at March 31, 1995 to $11,345 at
December 31, 1995, predominantly from an increase in accounts
receivable of $1,333 (due to a significant amount of shipments in the
latter part of the quarter) and an increase in inventory of $749.
Current liabilities decreased by $540, or approximately 12%, from
$4,352 at March 31, 1995 to $3,812 at December 31, 1995 predominantly
due to a reduction in accounts payable.
Since August 31, 1994 the Company has had a $2,000 working capital
line of credit secured by the Company's accounts receivable, notes
receivable and inventories. Interest on amounts borrowed on the line
of credit is at the bank's floating 30 day libor rate plus 2.75%. As
of December 31, 1995 that rate was 8.53%. The Company borrows
against and repays the line of credit throughout the year depending
upon its working capital needs and cash generated from operations,
with the outstanding amount under the line of credit during fiscal
1996 ranging from zero to $1,885. The Company believes its lender
will renew the line of credit when it matures on August 31, 1996.
In addition, on August 31, 1995, the Company borrowed $1,000 from the
same lender for an eighteen month term with interest at the bank's
floating 30 day libor rate plus 2.75%. As of December 31, 1995 that
rate was 8.53%. The Company also refinanced its mortgage note with
its lender on the same date. The Company's former mortgage note, in
the original principal amount of $1,000 was for a 15 year term with a
five year balloon with an interest rate of prime plus one-half
percent. The Company had been making its monthly principal payments
based upon a five year amortization schedule. By refinancing the
note, the Company was able to lower its interest rate to a fixed rate
of 8.50% from the floating rate of 9.25% as of the closing date for
the remainder of the original five year term.
The Company believes that its anticipated cash flow from operations
will be sufficient to fund its working capital needs, its capital
expenditures and its short and long term note obligations through
December 31, 1996.
8
<PAGE>
PART II - OTHER INFORMATION
---------------------------
Item 1. Legal Proceedings
-----------------
As previously reported, on August 3, 1995, one of the
Company's customers, Amtel Communications, Inc. and four
related entities ("Amtel"), filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code, which were
administratively consolidated under the case name of In re
ACI-HDT Supply Company, United States Bankruptcy Court for
the Southern District of California, Administratively
Consolidated Case No. 95-08253-A11.
In late 1994 and early 1995, the Company had sold Amtel on
credit approximately 3,500 payphones and related equipment.
To secure Amtel's obligations to pay the Company for the
payphones and related equipment pursuant to five promissory
notes, Amtel granted the Company a security interest in
payphones sold to Amtel and collateral assignments of
agreements between Amtel and the owners of certain sites
where those payphones had been or were to be installed
(collectively the "Collateral"). On the date of the
bankruptcy filing, the Company was owed approximately
$3,200,000 by Amtel. Even though Amtel was in default on
the payment of its obligations to the Company on the date
of Amtel's bankruptcy filing, the Company is prevented by
the automatic bankruptcy stay from exercising its remedies
on default against Amtel or the Collateral.
On October 10, 1995, the Company filed a motion for relief
from the automatic stay and/or adequate protection, Elcotel
v. Amtel Communications, Inc., et al., RS No. 03277 (the
"Motion"). Pursuant to the Motion, the Company sought
either: (i) relief from the automatic stay to enable the
Company to enforce its rights against the Collateral and/or
(ii) adequate protection of the Company's interests.
The Company was concerned that Amtel's violations of
various provisions of the security agreements with respect
to the Collateral were impairing the value of the Company's
Collateral. Therefore, on October 12, 1995, the Company
filed an emergency motion (the "Emergency Motion") for an
order requiring adequate protection of the Collateral
pending a determination of its Motion for relief from the
automatic stay. The relief sought by the Company in the
Emergency Motion included providing accountings with
respect to the Company's Collateral, prohibiting Amtel from
moving or disposing of the Company's Collateral without its
consent and providing the Company with information to poll
the pay telephones purchased by Amtel from the Company (the
"Equipment"). The Emergency Motion was opposed by Amtel,
the unsecured creditors' committee and the committee of
lessors. The oppositions were based on allegations that,
inter alia, (i) the Company's security interest in all of
the Collateral is not a fully perfected first priority
security interest; (ii) Amtel sold a substantial part of
the Collateral to third party lessors, who in turn leased
the Equipment back to Amtel, free and clear of the security
9
<PAGE>
interests granted to the Company; and (iii) the Company's
claim should be equitably subordinated. While the Company
believes at this time that it will prevail in all material
respects with regard to these issues, if any of those
issues are resolved against the Company, the Company's
ability to obtain repayment of the entire amount owed by
Amtel to the Company would be significantly impaired.
Prior to a decision on the Emergency Motion, the Company
reached an agreement with Amtel, the unsecured creditors'
committee and the committee of lessors to provide adequate
protection of the Company's asserted security interests in
the Collateral. Pursuant to such agreement, which is
subject to bankruptcy court approval, Amtel will, inter
alia, (i) insure the Equipment and provide the Company with
proof of such insurance; (ii) not install, deinstall, move
or relocate any Equipment without the Company's consent or
an order of the bankruptcy court; (iii) provide the Company
with information to allow the Company to poll the
Equipment; (iv) provide Elcotel with accountings of
revenues and expenses associated with the Collateral; (v)
provide the Company with a list of site locations where the
Equipment is installed; (vi) not do anything to jeopardize
or transfer site agreements relating to such Equipment; and
(vii) return to the Company custody of Equipment under
Amtel's control that is not presently installed. Pursuant
to such proposed agreement, consideration of the Motion for
relief from the automatic stay would be deferred
indefinitely. However, if the Company deems itself not
adequately protected, the Company can proceed with its
Motion for relief from the automatic stay. Even though
that agreement is not binding pending court approval, the
Company has warehoused and is the custodian of
approximately 1,350 payphones and miscellaneous pedestals
and enclosures comprising a part of the Equipment. Based
on information available to the Company from its polling of
the Equipment, the Company believes that approximately
1,510 pay telephones sold by the Company to Amtel are
currently installed and are being operated by Amtel.
Amtel has been granted an extension until March 20, 1996 to
file a reorganization plan with the Bankruptcy Court. The
Company is unable to predict the details of any plan that
may be filed, if any is filed, and has no basis to
determine the treatment that may be proposed in any plan
for the amounts owed to the Company.
The Company believes it is too early in Amtel's bankruptcy
case to determine whether or when Amtel will achieve
confirmation of a plan of reorganization or what the
proposed treatment of the Company or other creditors will
be in any plan of reorganization. The Company believes
there is potential for impairment of the amounts owed to
the Company by Amtel but is unable at this time to place a
value on that potential impairment.
10
<PAGE>
Nogah Bethlahmy, IRA, Bethlahmy Family Trust, et al. v.
Randy Kuhlmann, Elcotel, Inc., et al. (the "Bethlahmy
Litigation"). On November 21, 1995, an amended complaint
was filed in the Superior Court of the State of California,
County of San Diego, that named the Company as a defendant.
This case is a consumer class action brought ostensibly on
behalf of all persons who signed contracts with Amtel and
provided Amtel with funding from at least 1990 to the
present in the form of contracts to purchase private pay
telephones for public use pursuant to Amtel's
sale/leaseback program. The sale/leaseback program is
alleged to be a Ponzi scheme in which subsequent funds from
these contracts provided cash to pay the amounts promised
to earlier investors. The defendants include Randy
Kuhlmann, the sole shareholder, president and chief
financial officer of Amtel; another Amtel employee; certain
other persons and entities that provided services to Amtel;
a bank; a company that sold a route of installed payphones
to Amtel; and, in addition to the Company, another
manufacturer of pay telephone equipment that provided Amtel
with pay telephone equipment. The plaintiffs allege that
the Company and the other defendants violated various
provisions of California law, including the California
Securities Act, engaged in fraudulent and deceitful conduct
and made fraudulent and negligent misrepresentations and
omitted material facts about the sale/leaseback program.
The plaintiffs allege that the Company is liable based upon
its sale of pay telephones to Amtel, its purported
knowledge of the nature of the Ponzi scheme engaged in by
Amtel and defendant Randy Kuhlmann, and its participation
and involvement in such fraudulent scheme.
One of the other defendants removed the Bethlahmy
Litigation from state court to the Bankruptcy Court in
which the Amtel Chapter 11 case is pending before the
Company was required to answer or otherwise respond. Since
that time, the Company has been granted an open extension
of time to respond to the class action complaint pending
resolution of a motion of the plaintiffs to remand the case
to state court. The Company believes that the plaintiffs'
allegations against the Company in the Bethlahmy Litigation
are without merit.
11
<PAGE>
Item 4. Submission of Matters to a Vote of Security Holders
---------------------------------------------------
On October 10, 1995, the Company held its Annual Meeting of
Shareholders (the "Meeting"). The matters voted upon at
the Meeting were the election of directors and ratification
of the appointment of Deloitte & Touche LLP as the
Company's independent accountants for the fiscal year
ending March 31, 1996.
At the Meeting, the Shareholders were asked to elect seven
directors with each director to serve until the next annual
meeting of shareholders or until the election and
qualification of a respective successor. All of the
nominees for director recommended by the Board of Directors
were elected and the results of the voting were as follows:
Votes
Name Votes For Against Abstentions
---- --------- ------- -----------
Tracey L. Gray 7,410,899 5,252 0
C. Shelton James 7,410,899 5,252 0
Dwight Jasmann 7,410,899 5,252 0
Charles H. Moore 7,410,399 5,752 0
Thomas E. Patton 7,410,899 5,252 0
T. Raymond Suplee 7,410,899 5,252 0
Thomas R. Wiltse 7,410,399 5,752 0
At the Meeting, the shareholders ratified the appointment
of Deloitte & Touche LLP as the Company's independent
public accountants for the fiscal year ending March 31, 1996,
and the outcome of the voting was: 7,401,179 For; 1,697 Against;
and 13,275 Abstentions.
There were no broker non-votes in connection with any
proposals.
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
A. Exhibits:
None
B. Form 8-K:
None
12
<PAGE>
SIGNATURES
In accordance with the requirements of the Exchange Act, the
registrant has caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Elcotel, Inc.
-------------
(Registrant)
Date: February 13, 1996 By: /s/ Ronald M. Tobin
--------------------
Ronald M. Tobin
Vice President
(Principal Financial Officer and
Chief Accounting Officer)
13
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS AS OF DECEMBER 31, 1995 AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> MAR-31-1996
<PERIOD-START> APR-01-1995
<PERIOD-END> DEC-31-1995
<CASH> 100
<SECURITIES> 0
<RECEIVABLES> 4,142
<ALLOWANCES> 0
<INVENTORY> 3,103
<CURRENT-ASSETS> 11,345
<PP&E> 3,153
<DEPRECIATION> 0
<TOTAL-ASSETS> 15,859
<CURRENT-LIABILITIES> 3,812
<BONDS> 0
<COMMON> 79
0
0
<OTHER-SE> 11,376
<TOTAL-LIABILITY-AND-EQUITY> 15,859
<SALES> 16,373
<TOTAL-REVENUES> 16,373
<CGS> 9,841
<TOTAL-COSTS> 9,841
<OTHER-EXPENSES> 6,559
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (218)
<INCOME-PRETAX> 191
<INCOME-TAX> 67
<INCOME-CONTINUING> 124
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 124
<EPS-PRIMARY> .02
<EPS-DILUTED> .02
</TABLE>
