<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[X] Quarterly Report under Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the quarterly period ended June 30, 1998
Commission file number 1-10790
INDUSTRIAL TECHNOLOGIES, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 04-2596252
(State or other jurisdiction of I.R.S. Employer
incorporation or organization Identification Number
70 Cascade Blvd, Milford, CT 06460
(Address of Principal Executive Offices) (Zip Code)
(203) 876-1800
(Issuer's Telephone Number, including Area Code)
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 .
--- ---
As of June 30, 1998, the registrant had outstanding 5,766,798 shares of
Common Stock, $.01 par value.
Transitional Small Business Disclosure Format.
Yes No X .
--- ---
<PAGE> 2
INDEX
INDUSTRIAL TECHNOLOGIES, INC.
Page No.
--------
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited) 3-6
Consolidated Balance Sheets,
June 30, 1998, and September 30, 1997 3
Consolidated Statements of Operations, Three
Months and Nine Months Ended June 30, 1998, and 1997 4
Consolidated Statements of Cash Flows, Nine
Months Ended June 30, 1998, and 1997 5
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 7-8
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on 8-K 9
SIGNATURES 10
2
<PAGE> 3
PART I - FINANCIAL INFORMATION
INDUSTRIAL TECHNOLOGIES, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
ITEM 1. FINANCIAL STATEMENTS
<TABLE>
<CAPTION>
June 30, September 30,
1998 1997
------------ -------------
Assets (Unaudited) (Audited)
<S> <C> <C>
Current assets:
Cash and cash equivalents $ 143,176 $ 104,115
Trade accounts receivable, less allowance for doubtful
accounts of $114,921 in fiscal 1998 and $105,921 in fiscal 1997 1,774,491 722,549
Inventories 1,127,742 1,454,718
Prepaid expenses and other current assets 88,916 90,367
------------ ------------
Total current assets 3,134,325 2,371,749
Property and equipment, net 57,451 61,821
Deferred financing costs, less accumulated amortization
1998 $29,988; 1997 $16,452 24,064 37,600
Security deposits and other 113,532 116,340
------------ ------------
Total assets $ 3,329,372 $ 2,587,510
============ ============
Liabilities and Stockholders' Equity
Current liabilities:
Notes payable $ 1,172,650 $ 961,231
Current portion of long-term debt 76,923 76,923
Current portion of capital lease obligation 7,968 7,968
Accounts payable 1,004,713 1,107,200
Accrued expenses 889,554 934,872
Warranty and installation costs 356,749 208,583
Deferred revenue and customer deposits 599,450 271,868
------------ ------------
Total current liabilities 4,108,007 3,568,645
Long-term Liabilities:
Subordinated notes payable to stockholders 180,000 180,000
Long-term debt, less current maturities 365,385 423,077
Capital lease obligation, less current maturities 21,536 29,730
------------ ------------
Total liabilities 4,674,928 4,201,452
Stockholders' equity:
Common stock, $.01 par value. Authorized 14,000,000
shares; issued and outstanding 5,766,798 shares in
fiscal 1998 and 5,766,798 shares in fiscal 1997 57,667 57,667
Additional paid-in capital 13,120,397 13,120,397
Accumulated deficit (14,523,620) (14,792,006)
------------ ------------
Total stockholders' equity (1,345,556) (1,613,942)
------------ ------------
Total liabilities and stockholders' equity $ 3,329,372 $ 2,587,510
============ ============
</TABLE>
The accompanying Notes to Consolidated Financial Statements are an
integral part of these financial statements.
3
<PAGE> 4
INDUSTRIAL TECHNOLOGIES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
--------------------------------------------------------
June 30, June 30, June 30, June 30,
1998 1997 1998 1997
----------- ----------- ----------- -----------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Net sales $ 2,374,467 $ 1,565,958 $ 5,235,897 $ 5,748,168
Cost of goods sold 1,529,848 799,808 3,290,591 3,099,556
----------- ----------- ----------- -----------
Gross profit 844,619 766,150 1,945,306 2,648,612
Operating expenses:
Selling 238,515 329,686 638,447 1,069,705
General and administrative 165,408 400,831 520,849 1,172,937
Engineering 129,394 63,158 377,104 393,894
Amortization of costs in excess of
net assets of business acquired 0 76,865 0 230,596
----------- ----------- ----------- -----------
Total operating expenses 533,317 870,540 1,536,400 2,867,132
----------- ----------- ----------- -----------
Operating income (loss) 311,302 (104,390) 408,906 (218,520)
----------- ----------- ----------- -----------
Interest income (expense), net (56,917) (48,615) (172,879) (124,363)
Other income (expense), net 20,874 (23,057) $ 32,359 (10,301)
----------- ----------- ----------- -----------
Total other income (expense) (36,043) (71,672) (140,520) (134,664)
----------- ----------- ----------- -----------
Net income (loss) $ 275,259 $ (176,062) $ 268,386 $ (353,184)
=========== =========== =========== ===========
Income/ (loss) per share $ 0.05 $ (0.03) $ 0.05 $ (0.06)
=========== =========== =========== ===========
Weighted average common shares outstanding 5,766,798 5,608,631 5,766,798 5,519,798
=========== =========== =========== ===========
</TABLE>
The accompanying Notes to Consolidated Financial Statements are an
integral part of these financial statements.
4
<PAGE> 5
INDUSTRIAL TECHNOLOGIES, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENT OF CASH FLOWS
<TABLE>
<CAPTION>
Nine Months Ended
--------------------------
June 30, June 30,
1998 1997
----------- -----------
(Unaudited) (Unaudited)
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 268,386 $ (353,184)
Adjustment to reconcile net income to net cash
provided by (used for) operating activities:
Depreciation 6,645 10,514
Amortization of deferred financing costs 13,536 0
Amortization of costs in excess of net assets
of business acquired 0 230,596
Changes in assets and liabilities:
Increase in trade accounts receivable (1,051,942) (753,411)
Decrease (increase) in inventories 326,976 (128,897)
Decrease (increase) in prepaid expenses
and other current assets 4,259 (182,429)
Decrease in accounts payable (71,576) (20,064)
Increase (decrease) in accrued expenses 129,682 (18,400)
Increase (decrease) in warranty and installation costs 148,166 (56,111)
Increase (decrease) in deferred revenue
and customer deposits 327,582 (84,203)
----------- -----------
Net cash provided by (used for) operating activities 101,714 (1,355,589)
----------- -----------
Cash flows from investing activities:
Additions to property and equipment (2,275) 0
Other 0 (112,103)
----------- -----------
Net cash used for investing activities (2,275) (112,103)
----------- -----------
Cash flows from financing activities:
Net borrowings (payments) on revolving credit agreement 146,242 738,541
Payments on notes payable (140,734) 0
Proceeds from (payments on) CDA loan (57,692) 500,000
Payments on capital leases payable (8,194) 0
Proceeds from issuance of common stock, net of costs 0 83,587
----------- -----------
Net cash provided by (used for) financing activities (60,378) 1,322,128
----------- -----------
Net increase (decrease) in cash and cash equivalents 39,061 (145,564)
Cash and cash equivalents at beginning of period 104,115 298,630
----------- -----------
Cash and cash equivalents at end of period $ 143,176 $ 153,066
=========== ===========
Supplemental disclosures of cash flow information
Cash paid during period for:
Interest $ 162,181 $ 132,091
=========== ===========
Supplemental disclosures of cash flow information
Accounts payable converted to notes payable $ 30,911 $ 0
=========== ===========
Accrued expenses converted to notes payable $ 175,000 $ 0
=========== ===========
</TABLE>
The accompanying Notes to Consolidated Financial Statements are an integral
part of these financial statements.
5
<PAGE> 6
INDUSTRIAL TECHNOLOGIES, INC., AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1. NATURE OF BUSINESS
Industrial Technologies, Inc. and subsidiary (the "Company" or "INTI")
designs, assembles and markets automated surface inspection systems,
electro-optical sensors and other laser-based equipment, and industrial
computers and related products. The Company's surface inspection division's
customers include web process manufacturers of paper, plastics, film
photosensitive materials, steel, aluminum, glass, non-wovens and rubber
products. The Company's industrial computer division offers a full line of
industrial-strength processors, displays and peripherals to a variety of
customers. The Company sells its products throughout the United States and
internationally, primarily in Europe and the Far East.
Note 2. BASIS OF PRESENTATION
In the opinion of management, the accompanying unaudited consolidated
financial statements reflect all necessary, normal and recurring adjustments
which are required to present fairly the financial position of the Company and
its subsidiary as of June 30, 1998, and the results of operations and cash flows
for the three months and nine months ended June 30, 1998, and June 30, 1997.
Certain information and footnote disclosures normally included in the annual
financial statements, which are prepared in accordance with generally accepted
accounting principles, have been condensed or omitted. Accordingly, the Company
believes that although the disclosures are adequate to make the information
presented not misleading, these financial statements should be read in
conjunction with the annual financial statements of the Company and notes
thereto, contained in the Company's Form 10-KSB for the fiscal year ended
September 30, 1997. The results of operations for the three month and nine month
periods ended June 30, 1998 are not necessarily indicative of those that may be
expected for the full fiscal year.
Note 3. COMMITMENTS AND CONTINGENCIES
The Company has entered into employment agreements with certain
officers. The agreements are for terms ranging from one year to five years and
provide for a base salary and certain benefits which are specified in each of
the agreements. Each of the agreements also provide for severance pay for
termination under certain circumstances which are defined in the agreements. The
minimum annual commitments under the agreements are fiscal 1998: $155,917; and
fiscal 1999: $36,250.
INTI's wholly owned subsidiary, Intec Corp., is currently working with
the Department of Environmental Protection of the State of Connecticut (CT-DEP)
to review, and to clear, all adverse findings with respect to the
Tetrachloroethylene Analysis performed in May 1992. This analysis was performed
in conjunction with the CT-DEP Property Transfer Program. A follow-up analysis
was made as recently as December 1997. Although the levels of the contaminant
have decreased, they still remain above acceptable levels. Appropriate methods
are being and will be employed to lower these levels. Tests will continue until
compliance levels have been met. The Company has spent approximately $35,000 to
date. The Company believes the resolution of this matter will not have a
material impact on the financial position, results of operations or cash flows
of the Company.
Note 4. INVENTORIES
The components of inventories are as follows:
<TABLE>
<CAPTION>
June 30, 1998 September 30, 1997
------------- ------------------
<S> <C> <C>
Raw materials and subassemblies net of revenues $ 802,193 $1,228,853
Work in process 202,995 225,865
Finished goods 122,554 0
---------- ----------
$1,127,742 $1,454,718
========== ==========
</TABLE>
6
<PAGE> 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
FORWARD LOOKING INFORMATION
The statements in this Quarterly report on Form 10-QSB that are not historical
fact constitute "forward-looking statements." Said forward-looking statements
involve risks and uncertainties which may cause the actual results, performance
or achievements of the Company to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements.
These forward-looking statements are identified by their use of forms
of such terms and phrases as "expects," "intends," "goals," "estimates,"
"projects," "plans," "anticipates," "should," "future," "believes," and
"scheduled".
Variables which may cause differences include, but are not limited to,
the following: lack of adequate capital due to the inability to make timely
deliveries, the lack of prompt payment by large customers, the inability to
negotiate reasonable payment terms with creditors and a demand for payment under
the Company's revolving loan agreement; an unexpected increase in remediation
costs associated with environmental compliance; general economic and business
conditions; competition; success of operating initiatives; operating costs;
advertising and promotional efforts; the existence or absence of adverse
publicity; changes in business strategy or development plans; the ability to
retain management; business abilities and judgment of personnel; availability of
qualified personnel; labor and employee benefit costs; availability and costs of
raw materials and supplies; and changes in, or failure to comply with,
government regulations. Although the Company believes that the assumptions
underlying the forward-looking statements contained herein are reasonable, any
of the assumptions could be inaccurate, and therefore, there can be no assurance
that the forward-looking statements included in this filing will prove to be
accurate. In light of the significant uncertainties inherent in the
forward-looking statements included herein, the inclusion of such information
should not be regarded as a representation by the Company or any other person
that the objectives and expectations of the Company will be achieved.
RESULTS OF OPERATIONS
Three Months Ended June 30, 1998 Compared to Three Months Ended June 30, 1997
The Company had net sales for the three months ended June 30, 1998 (the
"current quarter") of $2,374,467, compared to $1,565,958 for the three months
ended June 30, 1997 (the "prior year quarter"). The increase of $808,509
primarily reflects the greater number of inspection systems sold in the current
quarter versus the prior year quarter due to the improved backlog at the
beginning of the current quarter.
The Company generated gross profits of $844,619 (35.6% of net sales)
for the current quarter compared to gross profits of $766,150 (48.9% of net
sales) for the prior year quarter. The 10.2% increase in amount is due to the
increase in net sales. The approximately 9 point decrease in gross profit
percentage relates to product and market mix. Product mix has a direct effect on
cost and market mix has a direct effect on selling price; therefore, the
combination effects gross profit. Gross profit percentage was affected primarily
by increased sales in Asia and Europe. In Asia, margins have decreased as a
result of the economic climate and will remain low until the economy becomes
stronger. European sales increased for the lower priced and lower margin System
3000 and Webscan systems, thus lowering the gross margin. The mix in product
sales for Europe is not considered likely to continue for the long term.
Selling, general and administrative expenses for the current quarter
were $403,923 (17.0% of net sales) compared to $730,517 (46.6% of net sales) for
the prior year quarter. The decrease in expense is due primarily to decreased
legal expenses plus the reduction of personnel in the selling and general and
administrative functional areas. The decrease in expense to net sales percentage
is a result of increased net sales and reduced expenses.
Engineering expenses for the current quarter were $129,394 (5.4% of net
sales) compared to the prior year quarter of $63,158 (4.0% of net sales).
Engineering provides applications support as well as the development of product
enhancements. In the prior year quarter, the Company capitalized approximately
$72,000 of costs, which were subsequently reversed by the Company at the end of
the prior year. Thus, comparable engineering expenses for the prior year quarter
were approximately $135,158 (8.6% of net sales). The Company was able to reduce
expenses to this functional area without sacrificing software and product
development. Reductions came in the form of overhead, minor personnel changes,
and the reduction of outside consultant use.
Costs in excess of net assets of business acquired was carried as an
intangible asset on the balance sheet and was being amortized over 15 years.
After review by management, the balance was charged against operations for the
year ended September 30, 1997 and no amounts will be amortized thereafter.
7
<PAGE> 8
The Company had net interest expense of $56,917 (2.4% of net sales) for
the current quarter compared to $48,615 (3.1% of net sales) in the prior year
quarter. This increase of $8,302 is due primarily to interest on money borrowed
in May 1997 in conjunction with the New Term Loan described below.
Other income in the amount of $20,874 compared to other expense of
$23,057 in the prior year quarter. Most of this income is the result of
favorable foreign currency exchange for the current quarter. In the prior
quarter, most of the expense was the result of unfavorable foreign currency
exchange.
The net income of $275,259 in the current quarter compared to a net
loss of $176,062 in the prior year quarter. Increased net sales, no
amortization, and decreased selling, general and administrative expense all
contributed to the increase in income.
Nine Months Ended June 30, 1998 Compared to Nine Months Ended June 30, 1997
The Company had net sales for the nine months ended June 30, 1998 (the
"current nine months") of $5,235,897, compared to $5,748,168 for the nine months
ended June 30, 1997 (the "prior year nine months"). The decrease of $512,271
primarily reflects the greater number of inspection and computer systems sold in
the prior year nine months versus the current nine months due to the reduced
backlog at the beginning of the current year.
The Company generated gross profits of $1,945,306 (37.2% of net sales)
for the current nine months compared to gross profits of $2,648,612 (46.1% of
net sales) for the prior year nine months. The 26.6% decrease in amount and
approximately 9 point decrease in gross profit percentage relate to product and
market mix. Product mix has a direct effect on cost and market mix has a direct
effect on selling price; therefore, the combination effects gross profit. Gross
profit was affected primarily by increased sales in Asia and Europe. In Asia,
margins have decreased as a result of the economic climate and will remain low
until the economy becomes stronger. European sales increased for the lower
priced and lower margin System 3000 and Webscan systems, thus lowering the gross
margin. The mix in product sales for Europe is not considered likely to continue
for the long term.
Selling, general and administrative expenses for the current nine
months were $1,159,296 (22.1% of net sales) compared to $2,242,642 (39.0% of net
sales) for the prior year nine months. The decrease in expense is due primarily
to decreased legal expenses plus the reduction of personnel in the selling and
general and administrative functional areas. The decrease in expense to net
sales percentage is primarily a result of the decrease in expenses, which more
than offset decreased net sales.
Engineering expenses for the current nine months were $377,104 (7.2% of
net sales) compared to the prior year nine months of $393,894 (6.9% of net
sales). Engineering provides applications support as well as the development of
product enhancements. The Company was able to reduce expenses to this functional
area without sacrificing software and product development. Reductions came in
the form of overhead, minor personnel changes, and the reduction of outside
consultant use. In the prior year nine months, the Company capitalized
approximately $112,000 of costs which were subsequently reversed by the Company
at the end of the prior year. Thus, comparable engineering expenses for the
prior year nine months were approximately $505,894 (8.8% of net sales).
Costs in excess of net assets of business acquired was carried as an
intangible asset on the balance sheet and was being amortized over 15 years.
After review by management, the balance was charged against operations for the
year ended September 30, 1997 and no amounts will be amortized thereafter.
The Company had net interest expense of $172,879 (3.3% of net sales)
for the current nine months compared to $124,363 (2.2% of net sales) in the
prior year nine months. This increase of $48,516 is due primarily to interest on
money borrowed in May 1997 in conjunction with the New Term Loan described
below.
Other income in the amount of $32,359 compared to other expense of
$10,301 in the prior year nine months. Most of this income is the result of
favorable foreign currency exchange for the current nine months. In the prior
year nine months, most of the expense was the result of unfavorable foreign
currency exchange.
The net income of $268,386 in the current nine months compared to a net
loss of $353,184 in the prior year nine months. No amortization, lower
engineering costs and decreased selling, general and administrative expense all
contributed to the increase in income.
8
<PAGE> 9
LIQUIDITY AND CAPITAL RESOURCES
The Company's primary source of liquidity at June 30, 1998, consisted
of $143,176 of cash plus the borrowing power under the Company's revolving loan,
demand loan and security agreement entered November 1, 1996 ("the Loan
Agreement") which provides a maximum borrowing of $1,500,000 at an annual
interest rate of 4% over the prime interest rate as published in the Wall Street
Journal. The loan matures on October 31, 1999, unless sooner terminated at the
option of the lender, at which time all amounts outstanding will be due and
payable. At June 30, 1998, the Company had borrowed $964,758 under the Loan
Agreement and $535,242 of additional borrowings would have been available if
there had been additional eligible accounts receivable. The revolving loan
requires interest to be paid monthly and has a maximum borrowing base of: the
lesser of $1,500,000 or the aggregate of (1) 80% of the Company's eligible
domestic accounts receivable, (2) 80% of the Company's eligible accounts
receivable covered by irrevocable letters of credit, (3) the lesser of 80% of
the Company's European eligible open accounts receivable or $500,000, and (4) a
$500,000 demand loan, which is payable in installments of principal of
approximately $16,700. The August, September and October, 1997 installments have
been deferred by the lender to September 1, 1999.
On May 28, 1997, the Company entered into a letter agreement (the
"Amendment Letter") modifying the Loan Agreement. The Amendment Letter modifies
the Loan Agreement such that the total principal amount permitted to be
outstanding may not exceed $2,000,000. Pursuant to the Loan Agreement as amended
by the Amendment Letter, additional credit was extended to the company in the
amount of $500,000 (the "New Term Loan"). Interest at a rate of 6% per annum
above the prime rate on a floating basis is due and payable monthly. Principal
is payable in quarterly installments of $19,231 commencing on December 1, 1997
through February 1, 2004. The Loan Agreement and the New Term Loan are secured
by a first priority security interest in all of the Company's personal property.
Simultaneous with the closing of the New Term Loan, the Connecticut Development
Authority purchased a 100% participation interest in the New Term Loan.
The Company requires additional capital to finance continuing
operations, make enhancements to and expansion of its manufacturing capacity in
accordance with its business strategy, and for working capital for inventory and
accounts receivable. The Company is seeking such funds through strategic
alliances, merger and acquisition efforts as well as through public or private
debt and equity. Without such future financing, the Company's ability to finance
its operations and growth will be severely limited.
At July 10, 1998, the Company's backlog of customer orders was
approximately $3,126,000 compared to approximately $1,662,000 at June 30, 1997.
The Company is seeking to increase its backlog in future quarters through an
increase in the rate of new proposals, although there can be no assurance that
such proposals will result in orders. The Company's ability to fulfill these
orders is largely dependent upon the Company's ability to maintain its borrowing
capacity and improve its liquidity.
CAPITAL EXPENDITURES
The Company does not have any material commitments for capital
expenditures at this time.
EFFECT OF INFLATION
The Company believes that inflation has not had a material effect on
its results of operations or financial condition during the last two fiscal
years. The Company has not entered into long-term contracts with its customers
or suppliers and has generally been able to pass along increased cost encurred
buy it.
9
<PAGE> 10
PART II - OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits. The following exhibits are filed herewith:
27. Financial Data Schedule.
(b) There were no reports on Form 8-K filed during the quarter
ended June 30, 1998.
10
<PAGE> 11
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
INDUSTRIAL TECHNOLOGIES, INC.
Date: July 28, 1998 By: /s/ Gerald W. Stewart
------------------------------------------
Gerald W. Stewart, Chief Executive Officer
11
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> SEP-30-1998
<PERIOD-START> OCT-01-1997
<PERIOD-END> JUN-30-1998
<CASH> 143,176
<SECURITIES> 0
<RECEIVABLES> 1,889,412
<ALLOWANCES> 114,921
<INVENTORY> 1,127,742
<CURRENT-ASSETS> 3,134,325
<PP&E> 1,032,087
<DEPRECIATION> 474,636
<TOTAL-ASSETS> 3,329,372
<CURRENT-LIABILITIES> 4,108,007
<BONDS> 566,921
0
0
<COMMON> 57,667
<OTHER-SE> (1,403,223)
<TOTAL-LIABILITY-AND-EQUITY> 3,329,372
<SALES> 5,235,897
<TOTAL-REVENUES> 5,235,897
<CGS> 3,290,591
<TOTAL-COSTS> 4,826,991
<OTHER-EXPENSES> 140,520
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 172,879
<INCOME-PRETAX> 268,386
<INCOME-TAX> 0
<INCOME-CONTINUING> 268,386
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 268,386
<EPS-PRIMARY> 0.05
<EPS-DILUTED> 0.05
</TABLE>
