<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
- --- ACT OF 1934 FOR THE QUARTERLY PERIOD ENDING MARCH 31, 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: 0-15692
TOTAL RESEARCH CORPORATION
(Name of small business issuer in its charter)
DELAWARE 22-2072212
(State of other jurisdiction of
incorporation or organization) (IRS Employer Identification No.)
Princeton Corporate Center, 5 Independence Way
Princeton, New Jersey 08543-5305
(address of principal executive offices) (Zip Code)
Issuer's telephone number: 609-520-9100
Check whether the registrant (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act 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
--- ---
State the number of shares outstanding of each of the issuer's classes of common
equity, as of May 13, 1997.
<TABLE>
<CAPTION>
<S> <C>
Common Stock, Par Value $.001 10,017,708
- ----------------------------- ----------
(Class) Outstanding
</TABLE>
Transactional Small Business Disclosure Format (check one): Yes No X
--- ---
<PAGE> 2
FORM 10 QSB
PART I - FINANCIAL INFORMATION
TOTAL RESEARCH CORPORATION
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, June 30,
1997 1996
---- ----
ASSETS (Unaudited) (Audited)
<S> <C> <C>
Current assets
Cash and cash equivalents $ 2,947,718 $ 4,201
Accounts receivable, less allowance for doubtful accounts of $110,000
at March 31, 1997 and $110,000 at June 30, 1996 4,511,138 4,166,486
Costs and estimated earnings in excess of billings on uncompleted
contracts 1,004,101 1,737,734
Deferred taxes 482,478 482,478
Income tax refund receivable 12,266 850,000
Other current assets 540,231 695,328
------------ ------------
Total current assets 9,497,932 7,936,227
Fixed assets, less accumulated depreciation of $2,957,877 at
March 31, 1997 and $2,691,011 at June 30, 1996 2,354,345 2,230,205
Capitalized market research products, less accumulated amortization of
$571,947 at March 31, 1997 and $511,947 at June 30, 1996 244,449 304,449
Deferred data accumulation costs, net of accumulated depreciation of
$1,522,855 at March 31, 1997 and $1,450,300 at June 30, 1996 287,436 347,436
Goodwill, net of accumulated amortization of $204,024 at
March 31, 1997 and $145,641 at June 30, 1996 1,733,929 1,792,312
Deferred taxes 296,082 290,640
Other assets 189,975 253,282
------------ ------------
Total assets $ 14,604,148 $ 13,154,551
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Current portion of notes payable $ 1,017,328 $ 1,584,792
Accounts payable 2,094,912 2,094,153
Accrued expenses and other current liabilities 1,764,316 1,702,126
Accrued restructuring costs 113,273 516,500
Billings in excess of earnings 4,701,386 2,115,142
Income taxes payable 285,980 86,303
------------ ------------
Total current liabilities 9,977,195 8,099,016
Long-term liabilities
Notes payable 1,200,000 2,142,000
Other long-term liabilities 216,495 92,314
------------ ------------
Total liabilities 11,393,690 10,333,330
------------ ------------
Shareholders' equity
Common stock-authorized 20,000,000 shares $.001 par value, 10,017,708 shares
issued and outstanding at March 31, 1997 and 9,882,108 shares
issued and outstanding at June 30, 1996 10,017 9,882
Additional paid-in capital 3,564,760 3,505,835
Cumulative translation adjustment (80,648) (90,685)
Retained earnings (accumulated deficit) (283,671) (603,811)
------------ ------------
Total shareholders' equity 3,210,458 2,821,221
------------ ------------
Total liabilities and shareholders' equity $ 14,604,148 $ 13,154,551
============ ============
</TABLE>
See notes to the consolidated financial statements.
<PAGE> 3
TOTAL RESEARCH CORPORATION
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Nine Months
Ended March 31, Ended March 31,
--------------- ---------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenues $ 7,470,957 $ 6,262,864 $ 20,797,515 $ 17,309,798
Direct costs 3,782,370 2,864,450 10,475,248 7,924,777
------------ ------------ ------------ ------------
Gross Profit 3,688,587 3,398,414 10,322,267 9,385,021
Operating Expenses 3,299,297 3,292,398 9,628,060 8,759,872
------------ ------------ ------------ ------------
Income from Operations 389,290 106,016 694,207 625,149
Interest Expense (34,423) (110,425) (201,938) (294,603)
Other income (expense), net (298) 5,909 25,051 (39,332)
------------ ------------ ------------ ------------
Income before taxes 354,569 1,500 517,320 291,214
Provision for income taxes 134,736 555 197,180 108,268
------------ ------------ ------------ ------------
Net income $ 219,833 $ 945 $ 320,140 $ 182,946
============ ============ ============ ============
Earnings per share $ 0.02 $ 0.00 $ 0.03 $ 0.02
Weighted average common shares 10,324,065 10,300,176 10,311,955 10,132,885
outstanding
</TABLE>
See notes to the consolidated financial statements.
<PAGE> 4
TOTAL RESEARCH CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Mar. 31, Mar. 31,
1997 1996
---- ----
<S> <C> <C>
Cash Flows from operating activities
Net Income $ 320,140 $ 182,946
Adjustments to reconcile net income to cash provided by operating activities
Depreciation 670,806 649,990
Amortization 110,383 138,415
Accretion of warrants 8,000 12,000
Adjustment for foreign currency translation 10,037 40,768
(Increase) decrease in assets
Accounts receivable (344,652) (221,208)
Cost and estimated earnings in excess of billings on uncompleted contracts 733,633 (346,240)
Other assets 1,050,697 (213,735)
Increase (decrease) in liabilities
Accounts payable 759 101,949
Accrued expenses (341,038) (416,531)
Billings in excess of earnings 2,586,244 399,519
Income taxes payable 199,677 (50,670)
Other long term liabilities 124,181 (145,410)
----------- -----------
Net cash provided by operating activities 5,128,867 131,793
Cash flows from investing activities:
Purchase of equipment (602,326) (623,620)
Acquisition of certain assets of Carlson net of cash acquired -- (286,965)
Cash expended for capitalized market research products -- (140,030)
Deferred data accumulation costs (132,620) (403,797)
----------- -----------
Net cash used by investing activities (734,946) (1,454,413)
Cash flows from financing activities:
Repayment of debt/net (1,509,464) 1,177,209
Payment under capital lease obligations, net -- 44,172
Proceeds from issuance of common stock 59,060 35,462
----------- -----------
Net cash provided by (used in) financing activities (1,450,404) 1,256,843
Net increase (decrease) in cash and cash equivalents 2,943,517 (65,777)
Cash and cash equivalents at beginning of period 4,201 128,071
----------- -----------
Cash and cash equivalents at end of period $ 2,947,718 $ 62,294
=========== ===========
</TABLE>
<PAGE> 5
TOTAL RESEARCH CORPORATION
Notes to Financial Statements
March 31, 1997 and 1996
Note 1 - Basis of Presentation
The accompanying unaudited financial statements have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete financial statements.
In the opinion of management, all adjustments (consisting of normal recurring
accruals) considered necessary for a fair presentation have been included.
Operating results for the nine months ended March 31, 1997 are not necessarily
indicative of the results that may be expected for the year ended June 30, 1997.
Note 2 - Presentation of European Subsidiary - TR-Europe
The summary of financial information, set forth below should be read in
conjunction with the consolidated financial statements as of and for the period
ended March 31, 1997 and March 31, 1996. The following summarizes information on
TR-Europe's Statement of Income, converted to U.S. Dollars using a weighted
average exchange rate of $1.60 and $1.54, for the nine month periods ended March
31, 1997 and 1996, respectively and a weighted average exchange rate of $1.60
and $1.53 for the three month periods ended March 31, 1997 and 1996,
respectively.
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
-------------------------- --------------------------
March 31, March 31, March 31, March 31,
1997 1996 1997 1996
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Revenues $2,203,325 $1,457,219 $6,013,471 $4,523,303
Direct Costs 1,119,979 681,456 2,922,765 2,251,741
---------- ---------- ---------- ----------
Gross Profit 1,083,346 775,763 3,090,706 2,271,562
Operating Expenses 929,002 735,349 2,809,777 2,118,946
---------- ---------- ---------- ----------
Income from Operations 154,344 40,414 280,929 152,616
Income Taxes 67,200 11,316 117,834 42,733
---------- ---------- ---------- ----------
Net Income $ 87,144 $ 29,098 $ 163,095 $ 109,883
========== ========== ========== ==========
</TABLE>
<PAGE> 6
Note 3 - Measurement of Goodwill
Goodwill has been recorded in relation to the excess of the purchase price over
the fair values of the identified assets acquired. The Company amortizes
goodwill over twenty-five years. The carrying value of goodwill is evaluated
periodically in relation to the operating performance and future undiscounted
net cash flows of the underlying business. Adjustments are recorded if the sum
of the expected future net cash flows is less than the book value of the
goodwill.
PART II - MANAGEMENT'S DISCUSSION OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS
Result of Operations - Third Quarter Fiscal 1997 as Compared to Third Quarter
Fiscal 1996.
Statement of Income Data:
(Expressed as a percentage of revenues)
<TABLE>
<CAPTION>
Three Months Ended
------------------
March 31,
---------
1997 1996
---- ----
<S> <C> <C>
Revenues 100.0% 100.0%
Direct costs 50.6% 45.7%
------ ------
Gross profit 49.4% 54.3%
Operating expenses 44.2% 52.6%
------ ------
Income from operations 5.2% 1.7%
Interest expense (.5%) (1.7%)
Other income (expense), net 0% 0.1%
------ ------
Income before income taxes 4.7% .1%
Provision for income taxes 1.8% 0.0%
------ ------
Net income 2.9% .1%
</TABLE>
<PAGE> 7
Revenues for the third quarter of fiscal 1997 increased 19.3% or $1,208,093
versus the same quarter in the prior year, to $7,470,957. The Company
experienced increasing revenues in its Total Research/Quality Management, Global
Health Care and newly formed Strategic Marketing Services (which includes its UK
subsidiary) divisions. The Company's Regional Offices division revenues were at
last year's level.
The Company defines backlog as the unearned portions of its existing contracts
at each balance sheet date. The Company's backlog at March 31, 1997 was
approximately $13,200,000 as compared to a backlog of approximately $9,600,000
at June 30, 1996 and approximately $9,500,000 at March 31, 1996. The amount of
backlog at any time may not be indicative of intermediate or long-term trends in
the Company's operations.
Direct costs for the third quarter of fiscal 1997 totaled $3,782,370, an
increase of 32.0% or $917,920 versus the prior year's total of $2,864,450. As
such, they were 50.6% of revenues, as compared to 45.7% of revenues in the prior
year. This increase in direct costs as a percentage of revenues is the result of
the Company's overall change in the mix of work it performed during the third
quarter of fiscal 1997 versus the third quarter of fiscal 1996. In the third
quarter of fiscal 1997 the Company delivered a greater percentage of
quantitative and international business, which is typically completed by
subcontracting the data collection phase of the project, and, therefore,
generates lower gross margins as compared to the equivalent quarter in fiscal
1996.
Operating expenses for the third quarter of fiscal 1997 totaled $3,299,297, an
increase of .2% or $6,899 over the same quarter in the prior year. As such, they
were 44.2% of revenues, as compared to 52.6% of revenues in the prior year. The
decrease in operating costs as a percentage of revenue is the result of the cost
cuts made during the reorganization last summer as well as prudent controls over
additional administrative spending. Expressed as a percentage of gross profit,
operating expenses decreased to 89.4% of gross profit in the third quarter of
fiscal 1997, versus 96.9% in the third quarter of fiscal 1996.
Income from operations increased $283,274 to $389,290 during the third quarter
of fiscal 1997, as compared to $106,016 during the third quarter of fiscal 1996,
for all the reasons set forth herein.
The Company's interest expenses decreased $76,002 in the third quarter of fiscal
1997 to $34,423, as compared to $110,425 in the third quarter of fiscal 1996.
The reduction of bank debt by approximately $1,500,000 over the past nine months
represents the reason for the significant reduction during the period.
Other income (expense) totaled ($298) for the third quarter of fiscal 1997, a
decrease of $6,207 versus income of $5,909 during the third quarter of fiscal
1996. The normal fluctuations of the business accounted for the difference from
period to period.
<PAGE> 8
Income before taxes totaled $354,569 for the third quarter of fiscal 1997 versus
$1,500 in the third quarter of fiscal 1996 for the reasons set forth above. The
income tax provision for the third quarter of fiscal 1997 was $134,736, versus
$555 for the third quarter of fiscal 1996 due to the increased earnings of the
Company.
Net income for the third quarter of fiscal 1997 was $219,833, or $.02 per share,
versus earnings of $945, or $.00 per share for the third quarter of fiscal 1996.
Result of Operations - Nine Months Year to Date Fiscal 1997 as compared to Nine
Months Year to Date Fiscal 1996
Statement of Income Data:
(Expressed as a percentage of revenues)
<TABLE>
<CAPTION>
Nine Months Ended
-----------------
March 31,
---------
1997 1996
---- ----
<S> <C> <C>
Revenues 100.0% 100.0%
Direct costs 50.4% 45.8%
------ ------
Gross profit 49.6% 54.2%
Operating expenses 46.3% 50.7%
------ ------
Income from operations 3.3% 3.5%
Interest expense (.9%) (1.7%)
Other income (expense), net .1% 0.0%
------ ------
Income before income taxes 2.5% 1.8%
Provision for income taxes .9% .7%
------ ------
Net income 1.6% 1.1%
</TABLE>
Revenues for the first nine months of fiscal 1997 increased 20.1% or $3,487,717
versus the same nine months in the prior year, to $20,797,515. The Company
experienced increasing revenues in its Global Health Care, Total
Research/Quality Management and newly reorganized Strategic Marketing Services
division (which includes the UK subsidiary). In addition, the revenue increased
as a result of including a full nine months of revenue earned from its
Minneapolis office which was acquired on November 27, 1995.
<PAGE> 9
The Company defines backlog as the unearned portions of its existing contracts
at each balance sheet date. The Company's backlog at March 31, 1997 was
approximately $13,200,000 as compared to a backlog of approximately $9,600,000
at June 30, 1996 and approximately $9,500,000 at March 31, 1996. The amount of
backlog at any time may not be indicative of intermediate or long-term trends in
the Company's operations.
Direct costs increased 32.2% or $2,550,417 for the first nine months of fiscal
1997 to $10,475,248 versus the prior year's nine month total of $7,924,777. As
such, they were 50.4% of revenues, as compared to 45.8% of revenues in the prior
year. This increase in direct costs as a percentage of revenues is the result of
the Company's overall change in the mix of work it performed during the first
nine months of fiscal 1997 versus the first nine months of fiscal 1996. The
Company delivered a much greater percentage of quantitative and international
business during the first nine months of fiscal 1997, which typically includes
substantial out-of-pocket expenses for data collection versus qualitative
business, which is typically more labor intensive and, therefore, generates
higher gross margins.
Operating expenses for the first nine months of fiscal 1997 totaled $9,628,060,
an increase of 9.9% or $868,188 over the first nine months of fiscal 1997.
Expressed as a percent of revenue, operating expenses decreased to 46.3% of
revenue in the first nine months of fiscal 1997, versus 50.7% in the first nine
months of fiscal 1996. The decrease in operating costs as a percentage of
revenue is the result of the cost cuts made during the reorganization last
summer as well as prudent controls over additional administrative spending.
Expressed as a percentage of gross profit, operating expenses remained at 93.3%
for the first nine months of fiscal 1997 and fiscal 1996.
Income from operations increased $69,058 to $694,207 during the first nine
months of fiscal 1997, as compared to $625,149 during the first nine months of
fiscal 1996, for all the reasons set forth herein.
The Company's interest expense decreased $92,665 in the first nine months of
fiscal 1997 to $201,938, as compared to $294,603 in the first nine months of
fiscal 1996, as a result of the reduction of corporate bank debt by
approximately $1,500,000.
Other income (expense) totaled $ 25,051 for the first nine months of fiscal
1997, an increase of $64,383 versus expense of ($39,332) during the first nine
months of fiscal 1996, due primarily to the licensing income of approximately
$25,000 earned by the Company as the result of its licensing arrangement with
TRCA in Argentina.
Income before taxes increased to $517,320 for the first nine months of fiscal
1997 versus $291,214 in the first nine months of fiscal 1996 for the reasons set
forth above.
The income tax provision for the first nine months of fiscal 1997 was $197,180,
versus $108,268 for the first nine months of fiscal 1996 due to the increased
earnings of the Company.
Net income for the first nine months of fiscal 1997 was $320,140, or $.03 per
share, versus earnings of $182,946 or $.02 per share for the first nine months
of fiscal 1996.
<PAGE> 10
Liquidity and Capital Resources
Although Cash and Cash Equivalents was $2,947,718 at March 31, 1997 from $4,201
at June 30, 1996 working capital (which is defined as total current assets less
total current liabilities) decreased to ($479,262), at March 31, 1997 from
($162,789) at June 30, 1996, and the current ratio decreased to .95 from .98 at
June 30, 1996. The decrease in working capital is the result of the increasing
pre-billings of its clients. Billings in excess of earnings (the amount the
Company has pre-billed its clients) has increased to $4.7 million from $2.1
million at June 30, 1996. Expressed as a percentage of total current
liabilities, Billings in excess of earnings increased to 47.1% of current
liabilities versus 26.1% as June 30, 1996. During the nine month period the
Company generated over $5 million dollars from operating activities.
The structure of the Company's Notes payable was $1.2 million long-term and
$1.02 million short-term. The short-term debt consists of term debt with Summit
Bank of $600,000 and a revolving line of credit with Coutt's and Co. (its UK
subsidiary's credit facility) of $417,328. During this period the Company paid
down its term debt with Summit Bank by $500,000 upon receiving its IRS refund as
part of an agreement made with the bank. The Company's line of credit with
Summit Bank, which was up for renewal at March 31, 1997, has been extended for
sixty days. The Company expects to renew its agreement with Summit Bank.
The financial covenants with Summit Bank have been amended which include
financial ratios of tangible net worth, total liabilities to tangible net worth,
debt service coverage ratio, and quick ratio. As of March 31, 1997, the Company
has met these minimum ratios.
The Company also has a bank overdraft facility of L300,000 with Coutt's & Co
in London, England. This facility is charged at a rate of 3% above the UK Base
Rate. At March 31, 1997, the bank borrowings were at L260,830 (approximately
US $417,328) and the UK Base Rate was 6.75%.
Cash and temporary cash investments totaled $2,947,718 at March 31, 1997 versus
$4,201 at June 30, 1996, The significant increase is the result of a few
factors. The Company received the majority of the $850,000 tax refund in early
January 1997. In addition, the Company has improved its ability to bill and
collect cash from its clients.
Net Accounts Receivable totaled $4,511,138 at March 31, 1997, compared to
$4,166,486 at the June 30, 1996, for a net increase of $344,652. The increase in
receivables is the mainly the result of the increasing business of the Company.
Costs and estimated earnings in excess of billings on uncompleted contracts
totaled $1,004,101 at March 31, 1997, compared to $1,737,734 at June 30,1996,
for a net decrease of $733,633. The Company's improvement in its billing process
accounts for the majority of this increase.
<PAGE> 11
Fixed assets at cost, less accumulated depreciation and amortization increased
by $124,140 at March 31, 1997 to $2,354,345, compared to $2,230,205 at June 30,
1996, due primarily to the office furnishings purchased for its redesigned
offices at its Princeton headquarters. The office furnishings were funded as
part of the lease agreement it signed with its landlord in December 1995.
Capitalized Market Research Products, decreased by $60,000 at March 31, 1997 to
$244,449, compared to $304,449 at June 30, 1996. The decrease is the result of
the amortization of its existing products. The Company is currently not
developing any new products but plans to do so in the near future.
Deferred Data Accumulation Costs decreased by $60,000 at March 31, 1997 to
$287,436, compared to $347,436 at June 30, 1996. The relatively small
fluctuation represents the fact the Company is amortizing historical costs at a
rate just above the rate that they are incurring current data collection costs.
Current portion of notes payable decreased by $567,464 at March 31, 1997 to
$1,017,328, compared to $1,584,792 at June 30, 1996. The decrease is due to the
Company completely reducing its revolving line of credit with Summit Bank.
Accounts payable and accrued expenses decreased by $340,278 at March 31, 1997 to
$3,972,501, compared to $4,312,779 at June 30, 1996. The decrease is the result
of reducing operating costs and the reduction of the accrued severance charges
incurred in fiscal 1996.
Billings in excess of earnings increased $2,586,244 at March 31, 1997 to
$4,701,386, compared to $2,115,142 at June 30, 1996. The increase is due
generally to the improvement of the billing process.
Federal and state income taxes payable increased $199,677 at March 31, 1997 to
$285,980, compared to $86,303 at June 30, 1996, as a result of the increased
earnings of the Company .
Long-term notes payable decreased $942,000 at March 31, 1997 to $1,200,000,
compared to $2,142,000 at June 30, 1996. The decrease is the result of a
pre-payment to Summit Bank of $500,000 per its loan agreement signed in October,
1996 as well as the normal payments made to the Summit Bank for its bank term
debt.
Inflation had no material effect on the financial performance of the Company
during the periods reported.
<PAGE> 12
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
There are no material legal actions, proceedings or litigations pending or
threatened to the knowledge of the Company.
Item 2. Changes in Securities
None.
Item 3. Defaults upon Senior Securities
None.
Item 4. Submission of Matters to a Vote of Security Holders
Item 5. Other information
None.
Item 6. Exhibits and Reports on Form 8-K:
A. None.
B. None.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
undersigned has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
TOTAL RESEARCH CORPORATION
--------------------------
(Registrant)
/s/ Lorin Zissman
---------------------------------
BY: LORIN ZISSMAN, CHAIRMAN
AND CHIEF EXECUTIVE OFFICER
/s/ Eric Zissman
---------------------------------
BY: ERIC ZISSMAN,
CHIEF FINANCIAL OFFICER
Dated: May 13, 1997
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 2,947,718
<SECURITIES> 0
<RECEIVABLES> 4,621,138
<ALLOWANCES> 110,000
<INVENTORY> 0
<CURRENT-ASSETS> 9,497,932
<PP&E> 5,312,222
<DEPRECIATION> 2,957,877
<TOTAL-ASSETS> 14,604,148
<CURRENT-LIABILITIES> 9,977,195
<BONDS> 0
10,017
0
<COMMON> 0
<OTHER-SE> 3,200,441
<TOTAL-LIABILITY-AND-EQUITY> 14,604,148
<SALES> 20,797,515
<TOTAL-REVENUES> 20,797,515
<CGS> 10,475,248
<TOTAL-COSTS> 9,678,060
<OTHER-EXPENSES> (25,051)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 201,938
<INCOME-PRETAX> 517,320
<INCOME-TAX> 197,180
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 320,140
<EPS-PRIMARY> 0.03
<EPS-DILUTED> 0
</TABLE>
