UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON DC 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1995
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 1-9317
HEALTH AND RETIREMENT PROPERTIES TRUST
(Exact name of registrant as specified in its charter)
Maryland 04-6558834
(State of Incorporation) (IRS Employer Identification No.)
400 Centre Street, Newton, Massachusetts 02158
(Address of principal executive office) (Zip Code)
(617) 332-3990
(Telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
YES X NO
Number of Common Shares outstanding at the latest practicable date,
November 5, 1995: 59,190,166 shares of beneficial interest, $.01 par value.
<PAGE>
HEALTH AND RETIREMENT PROPERTIES TRUST
FORM 10-Q
September 30, 1995
INDEX
PART I Financial Information Page
Item 1. Financial Statements (Unaudited)
Balance Sheets - December 31, 1994 and
September 30, 1995 3
Statements of Income - Quarters and Nine Months
Ended September 30, 1994 and 1995 4
Statements of Cash Flows - Nine Months
Ended September 30, 1994 and 1995 5
Notes to Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial 9
Condition and Results of Operations
PART II Other Information
Item 5. Other Information 12
Signatures
<PAGE>
HEALTH AND RETIREMENT PROPERTIES TRUST
BALANCE SHEETS
(dollars in thousands except per share amounts)
(Unaudited)
December 31, September 30,
1994 1995
------------ -------------
ASSETS
Real estate properties, at cost:
Land $ 63,186 $ 70,508
Buildings and improvements 609,897 691,394
----------- -----------
673,083 761,902
Less accumulated depreciation 39,570 49,809
----------- -----------
633,513 712,093
Real estate mortgages and notes, net 133,477 149,910
Investment in Hospitality Properties Trust -- 99,938
Cash and cash equivalents 59,766 20,908
Interest and rent receivable 4,712 6,625
Due from affiliate -- 1,944
Deferred interest and finance costs,
net and other assets 8,738 8,815
----------- -----------
$ 840,206 $ 1,000,233
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Bank notes payable $ -- $ 148,000
Notes and bonds payable, net 216,513 216,697
Security deposits 3,800 7,386
Due to affiliate 1,508 387
Accounts payable and accrued expenses 16,346 10,615
Shareholders' equity:
Preferred shares of beneficial
interest, $.01 par value,
50,000,000 shares authorized,
none issued -- --
Common shares of beneficial interest,
$.01 par value, 100,000,000 shares
authorized, 57,385,000 shares and
59,190,166 shares issued and
outstanding, respectively 574 592
Additional paid-in capital 652,989 677,809
Cumulative net income 168,808 218,836
Dividends (220,332) (280,089)
----------- -----------
Total shareholders' equity 602,039 617,148
----------- -----------
$ 840,206 $ 1,000,233
=========== ===========
See accompanying notes
<PAGE>
HEALTH AND RETIREMENT PROPERTIES TRUST
STATEMENTS OF INCOME
(amounts in thousands, except per share data)
(Unaudited)
Quarter Ended Nine Months Ended
September 30, September 30,
--------------- -----------------
1994 1995 1994 1995
---- ---- ---- ----
Revenues:
Rental income $ 17,864 $ 22,993 $ 43,865 $ 67,789
Interest income 5,952 5,980 17,414 17,674
-------- -------- -------- --------
Total revenues 23,816 28,973 61,279 85,463
-------- -------- -------- --------
Expenses:
Interest 2,887 6,675 5,215 17,819
Depreciation and amortization 3,971 5,538 9,926 16,314
General, administrative and
advisory 1,370 1,606 3,566 4,676
-------- -------- -------- --------
Total expenses 8,228 13,819 18,707 38,809
-------- -------- -------- --------
Income before equity in income of
Hospitality Properties Trust,
gain on sale of properties
and extraordinary item 15,588 15,154 42,572 46,654
Equity in income of
Hospitality Properties Trust -- 898 -- 898
-------- -------- -------- --------
Income before gain on sale of
properties and extraordinary
item 15,588 16,052 42,572 47,552
Gain on sale of properties -- -- 3,994 2,476
Extraordinary item - early
extinguishment of debt and
termination costs of interest
rate hedging arrangements -- -- (1,953) --
-------- -------- -------- --------
Net income $ 15,588 $ 16,052 $ 44,613 $ 50,028
======== ======== ======== ========
Weighted average shares
outstanding 57,384 59,189 51,172 58,977
======== ======== ======== ========
Per share amounts:
Income before equity income,
gain on sale of properties
and extraordinary item $ .27 $ .26 $ .83 $ .79
======== ======== ======== ========
Income before gain on sale of
properties and extraordinary
item $ .27 $ .27 $ .83 $ .81
======== ======== ======== ========
Net income $ .27 $ .27 $ .87 $ .85
======== ======== ======== ========
See accompanying notes
<PAGE>
HEALTH AND RETIREMENT PROPERTIES TRUST
STATEMENTS OF CASH FLOWS
(dollars in thousands)
(Unaudited)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
-----------------
1994 1995
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net income $ 44,613 $ 50,028
Adjustments to reconcile net income to
cash provided by operating activities:
Equity in income of Hospitality Properties Trust -- (898)
Gain on sale of properties (3,994) (2,476)
Loss on early extinguishment of debt 1,953 --
Depreciation and amortization 9,926 16,314
Amortization of interest costs and bond discount 537 1,100
(Decrease) increase in security deposits (4,500) 3,586
Deferred finance costs (6,532) (1,665)
Changes in assets and liabilities:
Increase in interest and rent receivable and other assets (1,380) (1,440)
Increase (decrease) in accounts payable and
accrued expenses 6,639 (5,492)
Decrease in due to affiliate (347) (1,120)
--------- ---------
Cash provided by operating activities 46,915 57,937
--------- ---------
Cash flows from investing activities:
Investment in mortgage loans and loans receivable (13,631) (22,827)
Repayment of mortgage loans 45,688 26,959
Real estate acquisitions (335,781) (88,752)
Sale of real estate 28,400 5,000
Loan and advances to Hospitality Properties Trust -- (165,241)
Repayment of loan and advances to Hospitalities Properties Trust -- 60,888
Loans to affiliates -- (1,065)
--------- ---------
Cash used in investing activities (275,324) (185,038)
--------- ---------
Cash flows from financing activities:
Proceeds from issuance of shares, net 182,366 --
Proceeds from borrowings 351,390 213,000
Payments on borrowings (208,000) (65,000)
Dividends paid (52,628) (59,757)
--------- ---------
Cash provided by financing activities 273,128 88,243
--------- ---------
Increase (decrease) in cash and cash equivalents 44,719 (38,858)
Cash and cash equivalents at beginning of period 13,887 59,766
--------- ---------
Cash and cash equivalents at end of period $ 58,606 $ 20,908
========= =========
Supplemental cash flow information:
Interest paid $ 2,381 $ 16,599
========= =========
Non-cash activities:
Purchase of real estate $ -- ($ 24,444)
Sale of real estate -- 19,500
Issuance of shares -- 24,838
Investment in mortgage loan -- (19,500)
Investment in Hospitality Properties Trust -- (100,000)
Cancellation of advances and loan to
Hospitality Properties Trust -- 100,000
</TABLE>
See accompanying notes
<PAGE>
HEALTH AND RETIREMENT PROPERTIES TRUST
NOTES TO FINANCIAL STATEMENTS
September 30, 1994 and 1995
(dollars in thousands, except per share data)
(Unaudited)
1. Basis of presentation
The financial statements of Health and Retirement Properties Trust ("the
Company") 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 interim periods are
not necessarily indicative of the results that may be expected for the full
year.
2. Dividends
On October 5, 1995, the Trustees declared a dividend on the Company's
common shares of beneficial interest with respect to the quarter ended September
30, 1995, of $.35 per share, which will be paid on or about November 28, 1995,
to shareholders of record at the close of business on October 20, 1995.
3. Real estate properties
During the nine months ending September 30, 1995, the Company acquired 20
nursing properties and 2 medical office buildings for approximately $113,196. In
addition, the Company sold one nursing property for $24,500 and realized a gain
of approximately $2,476. Nine nursing properties have been leased to an
affiliate. These acquisitions were funded with cash on hand, $73,000 of drawings
on the Company's revolving credit facility and the issuance of 1,777,766 common
shares of beneficial interest. The leases on 12 of the nursing properties are
secured by a $3,586 security deposit.
During the nine months ending September 30, 1995, the Company provided
improvement financing at existing properties of approximately $4,296. As of
September 30, 1995, the Company has a commitment to purchase a medical office
building for approximately $15,000.
4. Investment in Hospitality Properties Trust (HPT)
On March 24, 1995 the Company's then wholly owned subsidiary, HPT, acquired
21 Courtyard by Marriott(R) hotels for approximately $179,400. HPT's acquisition
of these properties was funded by the Company under a demand loan (HRP Loan) of
approximately $163,300. The Company funded this transaction by drawing $140,000
on its revolving credit facility and with cash on hand. In August, 1995, HPT
completed its Initial Public Offering (IPO) of 8,350,000 shares. Prior to the
IPO, the Company acquired 40,000 shares of HPT for $1,000. Concurrent with the
completion of the IPO, the Company purchased for $25 per share an additional
3,960,000 shares of HPT by canceling $99,000 of the HRP Loan. The remaining
amount of the HRP Loan was repaid to the Company. At September 30, 1995 the
Company owned 4,000,000 shares of HPT, representing an equity interest in HPT of
approximately 32%. Approximately $1,944 is due to the Company from HPT
representing expenses advanced by the Company to HPT and dividends related to
the Company's ownership in HPT prior to the IPO.
<PAGE>
HEALTH AND RETIREMENT PROPERTIES TRUST
NOTES TO FINANCIAL STATEMENTS
September 30, 1994 and 1995
(dollars in thousands, except per share data)
(Unaudited)
5. Real estate mortgages and notes, net
In connection with the sale of the nursing property described in Note 3,
the Company provided a $19,500 mortgage due December 31, 2000, bearing interest
at 11% per annum. In addition, during the nine months ended September 30, 1995,
the Company provided debt financing totaling $18,895 secured by mortgages on
four assisted living and four nursing properties. These mortgage notes bear
interest between 10% and 11.35% and mature between 2007 and 2012.
During the nine months ended September 30, 1995, loans secured by nursing
properties with outstanding principal balances totaling $26,726 were repaid.
6. Indebtedness
The Company has increased the maximum amount available under its existing
revolving credit facility to $250,000. The credit facility will mature in 1998
and bears interest at a spread over LIBOR or Prime. At September 30, 1995,
$148,000 was outstanding under the credit facility.
7. Common Shares of Beneficial Interest
On July 7, 1995, the Board of Trustees granted a total of 10,000 shares
under the 1992 Share Award Plan. These share awards will vest over a three year
period, with one-third of the shares vesting on the date of grant. At September
30, 1995, 945,100 shares remain reserved for issuance under the 1992 Share Award
Plan.
8. Concentration of Credit Risk
At September 30, 1995, 36% of the Company's real estate properties, net,
and mortgage receivables were in properties leased to Marriott International,
Inc., (Marriott). The financial statements of Marriott have been filed as a part
of Marriott's Quarterly Report on Form 10-Q, file number 1-12188, for the
quarter ended September 8, 1995.
<PAGE>
HEALTH AND RETIREMENT PROPERTIES TRUST
NOTES TO FINANCIAL STATEMENTS
September 30, 1994 and 1995
(dollars in thousands, except per share data)
(Unaudited)
9. Pro forma information
The following summarized Pro Forma Statements of Income assume all of the
Company's real estate financing transactions during 1994 and 1995, and related
financings had occurred as of the beginning of the presented periods and give
effect to the Company's borrowing rates throughout the periods indicated.
The summarized Pro Forma Balance Sheet is intended to present the financial
position of the Company as if the transactions referred to in the paragraph
above and related financing had occurred on September 30, 1995.
These pro forma statements are not necessarily indicative of the expected
results of operations or the Company's financial position for any future period.
Differences could result from, but are not limited to, additional property
investments, changes in interest rates and changes in the debt and/or equity
structure of the Company.
Pro Forma Statements of Income
(unaudited)
Year Ended Nine Months Ended
December 31, September 30,
1994 1994 1995
------------ -------- ------
Total revenues $102,561 $72,936 $80,191
Total expenses 41,954 29,378 37,530
-------- ------- -------
Income before equity income in HPT 60,606 43,558 42,661
Equity income in HPT 8,352 6,271 6,434
-------- ------- -------
Net income $ 68,959 $49,829 $49,095
======== ======= =======
Weighted average shares
outstanding 59,190 59,190 59,190
======== ======= =======
Net income per share $ 1.17 $ .84 $ .83
======== ======= =======
Pro Forma Balance Sheet at September 30, 1995
(Unaudited)
Real estate properties, net $ 712,093
Real estate mortgages and notes, net 140,322
Equity investment in HPT 99,938
Other assets 47,880
----------
Total Assets $1,000,233
Indebtedness $ 364,697
Other liabilities 18,388
Shareholders' equity
Total Liabilities and 617,148
----------
Shareholders' Equity $1,000,233
==========
<PAGE>
HEALTH AND RETIREMENT PROPERTIES TRUST
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS AND FINANCIAL CONDITION
RESULTS OF OPERATIONS
Quarter Ended September 30, 1995 Versus 1994
Total operating revenues for the quarter ended September 30, 1995 increased
to $28,973,000 from $23,816,000 for the quarter ended September 30, 1994. Rental
income increased to $22,993,000 from $17,864,000 and interest income increased
to $5,980,000 from $5,952,000 during the comparable period. Rental income
increased primarily as a result of new investments in real estate subsequent to
September 30, 1994. The change in interest income is primarily the net result of
pre-payment penalties earned by the Company for the early repayment of loans
secured by real estate and lower interest income associated with such
repayments.
Total expenses for the quarter ended September 30, 1995 increased to
$13,819,000 from $8,228,000 for the quarter ended September 30, 1994. The
increase is primarily the result of increases in interest and depreciation
expense of $3,788,000 and $1,567,000, respectively. Depreciation and interest
increased as a result of new investments since September 30, 1994 and as a
result of increased borrowings used to fund such investments, respectively.
Net income increased to $16,052,000 or $.27 per share for the 1995 quarter
from $15,588,000 or $.27 per share for the 1994 quarter. The increase is
primarily a result of the new investments since September 30, 1994. On a per
share basis, net income remains unchanged because of additional common shares
issued since September 30, 1994.
The Company bases its dividend primarily on funds from operations. Funds
from operations is net income excluding gains (or losses) from debt
restructuring and sales of property, plus depreciation and amortization. Cash
available for distribution may not necessarily equal funds from operations as
the cash flow of the Company is affected by other factors not included in the
funds from operations calculation. Funds from operations for the 1995 quarter
were $22,396,000 or $.38 per share and $19,818,000 or $.35 per share for the
1994 quarter. The dividends declared which relate to these quarters were
$20,717,000 or $.35 per share in 1995 and $18,937,000 or $.33 per share in 1994.
Nine months ended September 30, 1995 versus 1994
Total revenues for the nine months ended September 30, 1995 increased to
$85,463,000 from $61,279,000 for the nine months ended September 30, 1994.
Rental income increased to $67,789,000 from $43,865,000 and interest income
increased to $17,674,000 from $17,414,000 during the comparable period. Rental
income increased primarily as a result of new investments in real estate
subsequent to September 30, 1994. Interest income increased
<PAGE>
HEALTH AND RETIREMENT PROPERTIES TRUST
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS AND FINANCIAL CONDITION
Nine months ended September 30, 1995 versus 1994 - continued
primarily as a result of an increase in interest income earned on higher cash
balances during 1995 compared to 1994 net of lower mortgage interest income
resulting from early repayment of real estate mortgage loans acquired by the
Company at a discount and the decrease in the associated accretion of such
discount.
Total expenses for the nine months ended September 30, 1995 increased to
$38,809,000 from $18,707,000 for the nine months ended September 30, 1994. The
increase is primarily the result of increases in interest and depreciation
expense of $12,604,000 and $6,388,000, respectively. Depreciation and interest
increased as a result of new investments since September 30, 1994, and as a
result of increased borrowings used to fund such investments, respectively.
Income before gain on sale of properties and extraordinary item increased
to $47,552,000 or $.81 per share for the 1995 period from $42,572,000 or $.83
per share for the 1994 period. Net income was $50,028,000 ($.85 per share) for
the 1995 period versus $44,613,000 ($.87 per share) for the 1994 period. The
increase is primarily a result of new investments since September 30, 1994. On a
per share basis, net income decreased because of additional common shares issued
since September 30, 1994.
Funds from operations for the nine months ended September 30, 1995, were
$65,422,000 or $1.11 per share and $53,136,000 or $1.04 per share for the 1994
period. The dividends declared which relate to the nine months ended September
30, 1995 and 1994 were $60,963,000 or $1.03 per share and $52,628,000 or $.99
per share, respectively.
LIQUIDITY AND CAPITAL RESOURCES
Assets of the Company increased by $160,027,000 to over $1 billion at
September 30, 1995, from $840,206,000 at December 31, 1994. This increase is
principally the result of new real estate investments and a 32% equity ownership
investment in Hospitality Properties Trust (HPT).
At September 30, 1995, the Company had $20,908,000 of cash and cash
equivalents, and the ability to borrow up to an additional $102,000,000 under
its revolving credit facility. At September 30, 1995, the Company had
outstanding commitments to provide financings of approximately $19,296,000.
During the nine months ending September 30, 1995, the Company acquired 20
nursing properties and 2 medical office buildings for approximately
$113,196,000. The Company also sold one nursing property for $24,500,000 and
realized a gain of approximately $2,476,000. In addition, the Company provided
debt financing totaling $18,895,000 secured by mortgages on four assisted living
and four nursing properties. These mortgage notes bear interest between 10% and
11.35% and mature between 2007 and 2012. Loans secured by nursing properties
with outstanding principal balances totaling $26,726,000 were repaid. These
acquisitions were funded with cash on hand,
<PAGE>
HEALTH AND RETIREMENT PROPERTIES TRUST
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS AND FINANCIAL CONDITION
LIQUIDITY AND CAPITAL RESOURCES - continued
$63,000,000 of drawings on the Company's revolving credit facility and the
issuance of 1,777,766 common shares of beneficial interest.
On March 24, 1995 the Company's then wholly owned subsidiary, HPT, acquired
21 Courtyard by Marriott(R) hotels for approximately $179,400,000. HPT's
acquisition of these properties was funded by the Company under a demand loan
(HRP Loan) of approximately $163,300,000. During August, 1995, HPT completed an
Initial Public Offering (IPO) of 8,350,000 shares. Prior to the IPO, the Company
purchased 40,000 shares of HPT for $1,000,000. Concurrent with the completion of
the IPO, the Company purchased for $25 per share an additional 3,960,000 shares
of HPT by canceling $99,000,000 of the HRP Loan. The remaining amount of the HRP
Loan was repaid to the Company. At September 30, 1995 the Company owns 4,000,000
shares of HPT, representing an equity interest of approximately 32%.
Approximately $1,944,000 is due to the Company from HPT representing expenses
advanced by the Company to HPT and dividends related to the Company's ownership
in HPT prior to the IPO.
The Company has recently increased the maximum amount available under its
existing revolving credit facility to $250,000,000. The credit facility will
mature in 1998 and bears interest at a spread over LIBOR or Prime. At September
30, 1995, $148,000,000 was outstanding under the credit facility.
The Company is continuing to seek new investments to expand and diversify
its portfolio of leased and mortgaged health care related real estate.
Approximately 72% of the Company portfolio is leased to or mortgage financed
with seven publicly traded companies. The Company intends to balance the use of
debt and equity in such a manner that the long term cost of funds borrowed to
acquire or mortgage finance facilities is appropriately matched, to the extent
practicable, to the terms of the investments made with such borrowed funds. As
of September 30, 1995, the Company's debt as a percentage of total
capitalization was approximately 38%. Current expenses and dividends are
provided for by funds from operations.
<PAGE>
HEALTH AND RETIREMENT PROPERTIES TRUST
Part II
Item 5
Other Information
John L. Harrington and Arthur G. Koumantzelis resigned as trustees of the
Company to join the Board of Trustees of Hospitality Properties Trust (HPT)
following the completion of HPT's initial public offering. The vacancies created
by their resignation have been filled by Ralph J. Watts and Bruce M. Gans, MD.
Ralph J. Watts (age 48) is President and Chief Executive Officer of
Cardiovascular Ventures, Inc., a privately held, venture capital backed company
which develops, owns and operates outpatient cardiac catheterization
laboratories and which is engaged in physician practice management and
ownership. Mr. Watts has had this position since 1992. From 1988 to 1992 Mr.
Watts was President and CEO of Ramsay Health Care, Inc., a publicly owned
company which owned and operated 18 hospitals in 13 states and had approximately
2000 employees.
Bruce M. Gans, MD (age 48) is President of the Rehabilitation Institute of
Michigan, a specialty hospital affiliated with Wayne State University School of
Medicine. Dr. Gans is also Professor and Chairman of the Department of Physical
Medicine and Rehabilitation at Wayne State University School of Medicine. Prior
to his current position, Dr. Gans was Chairman of the Department of
Rehabilitation Medicine at New England Medical Center and Professor and Chairman
of Rehabilitation Medicine at the Tufts University School of Medicine in Boston,
MA. Dr. Gans is a graduate of the University of Pennsylvania School of Medicine
and he is a leader in a number of medical professional organizations including
serving as the current Chairman of the Injury Prevention Grant Review Committee
for the Centers for Disease Control and Prevention in Atlanta, GA.
<PAGE>
HEALTH AND RETIREMENT PROPERTIES TRUST
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 duly authorized.
HEALTH AND RETIREMENT
PROPERTIES TRUST
(Registrant)
DATE November 14, 1995 BY /s/ David J. Hegarty
David J. Hegarty, President
DATE November 14, 1995 BY /s/ Ajay Saini
Ajay Saini, Treasurer
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<CURRENCY> US
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> SEP-30-1995
<EXCHANGE-RATE> 1
<CASH> 20,908
<SECURITIES> 0
<RECEIVABLES> 6,625
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 761,902
<DEPRECIATION> 49,809
<TOTAL-ASSETS> 1,000,233
<CURRENT-LIABILITIES> 0
<BONDS> 364,697
<COMMON> 592
0
0
<OTHER-SE> 616,556
<TOTAL-LIABILITY-AND-EQUITY> 1,000,233
<SALES> 0
<TOTAL-REVENUES> 85,463
<CGS> 0
<TOTAL-COSTS> 38,809
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 17,819
<INCOME-PRETAX> 46,654
<INCOME-TAX> 0
<INCOME-CONTINUING> 46,654
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<EXTRAORDINARY> 0
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<NET-INCOME> 50,028
<EPS-PRIMARY> .85
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