SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________________________________________________
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended April 3, 1998
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 0-15160
ATL ULTRASOUND, INC.
(Exact name of registrant as specified in its charter)
Washington 91-1353386
(State of incorporation) (IRS Employee Identification No.)
22100 Bothell-Everett Highway
Post Office Box 3003
Bothell, Washington 98041-3003
(Address of principal (ZIp Code)
executive offices) (Zip Code)
(425) 487-7000
(Telephone number)
Common stock, $0.01 par value; 14,603,555 shares outstanding as
of May 1, 1998
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 [ ]
<PAGE>
ATL ULTRASOUND, INC.
TABLE OF CONTENTS
PART I Financial Information Page No.
--------------------- --------
Item 1. Financial Statements
--------------------
Condensed Consolidated Balance Sheets -
April 3, 1998 (Unaudited) and December 31, 1997..........3
Condensed Consolidated Statements of Operations
(Unaudited) - Three Months Ended April 3, 1998
and March 28, 1997........................................4
Condensed Consolidated Statements of Cash Flows
(Unaudited) - Three Months Ended April 3, 1998
and March 28, 1997 .......................................5
Notes to Condensed Consolidated Financial Statements......6
Item 2. Management's Discussion and Analysis of Financial
-------------------------------------------------
Condition and Results of Operations........................10
-----------------------------------
PART II Other Information
-----------------
Item 1. Legal Proceedings..........................................14
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Item 2. Changes in Securities......................................14
---------------------
Item 3. Defaults Upon Senior Securities............................14
-------------------------------
Item 4. Submission of Matters to a Vote of Security Holders........14
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Item 5. Other Information..........................................14
-----------------
Item 6. Exhibits and Reports on Form 8-K...........................14
--------------------------------
2
<PAGE>
PART I Financial Information
- ------ ---------------------
Item 1. Financial Statements
--------------------
ATL ULTRASOUND, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
- -----------------------------------------------------------------
(In thousands) 4/3/98 12/31/97
- -----------------------------------------------------------------
(Unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 43,113 $ 30,821
Receivables, net 117,243 136,351
Inventories 97,307 98,677
Prepaid expenses 3,831 2,207
Deferred income taxes, net 13,735 13,668
--------------------
Total current assets 275,229 281,724
PROPERTY, PLANT AND EQUIPMENT, NET 76,380 74,630
OTHER ASSETS, NET 5,633 5,456
--------------------
$ 357,242 $ 361,810
====================
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Short-term borrowings $ 295 $ 654
Current portion of long-term debt 456 449
Accounts payable and accrued expenses 66,488 80,529
Dividend payable 30,331 --
Deferred revenue 15,645 15,831
Taxes on income 7,000 1,457
--------------------
Total current liabilities 120,215 98,920
LONG-TERM DEBT 12,166 12,307
OTHER LONG-TERM LIABILITIES 21,089 20,862
SHAREHOLDERS' EQUITY 203,772 229,721
--------------------
$ 357,242 $ 361,810
====================
- ----------------------------------------------------------------
COMMON SHARES OUTSTANDING 14,590 14,413
- ----------------------------------------------------------------
See accompanying notes to condensed consolidated financial statements.
3
<PAGE>
ATL ULTRASOUND, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
Three months ended
- ----------------------------------------------------------------
(In thousands, except per share data) 4/3/98 3/28/97
- ----------------------------------------------------------------
REVENUES
Product sales $ 81,999 $ 77,714
Service 23,417 22,404
--------------------
105,416 100,118
--------------------
COST OF SALES
Cost of product sales 38,315 39,816
Cost of service 14,304 12,522
--------------------
52,619 52,338
GROSS PROFIT 52,797 47,780
OPERATING EXPENSES, NET
Selling, general and administrative 33,656 30,308
Research and development 14,934 14,764
Other expense, net 1,619 356
--------------------
50,209 45,428
--------------------
INCOME FROM OPERATIONS 2,588 2,352
Interest income 426 956
Interest expense (286) (742)
--------------------
INCOME BEFORE INCOME TAXES 2,728 2,566
Income tax expense 545 514
--------------------
NET INCOME $ 2,183 $ 2,052
====================
Net income per share:
Basic $ 0.15 $ 0.15
Diluted $ 0.15 $ 0.14
Weighted-average common shares
and equivalents outstanding:
Basic 14,303 13,971
Diluted 15,010 14,836
- ----------------------------------------------------------------
See accompanying notes to condensed consolidated financial statements.
4
<PAGE>
ATL ULTRASOUND, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
Three months ended
- -------------------------------------------------------------------------
(In thousands) 4/3/98 3/28/97
- -------------------------------------------------------------------------
OPERATING ACTIVITIES
Net income $ 2,183 $ 2,052
Adjustments to reconcile net income
to cash provided by operating activities:
Depreciation and amortization 4,280 4,040
Deferred income tax expense (benefit) (67) 48
Changes in:
Receivables, net 18,032 18,545
Inventories 910 2,754
Accounts payable and accrued expenses (13,556) (9,456)
Deferred revenue (117) (1,799)
Taxes on income 5,557 (1,408)
Other (1,847) 353
-------------------
Cash provided by operations 15,375 15,129
INVESTING ACTIVITIES
Investment in property, plant and equipment (5,383) (2,903)
-------------------
Cash used by investing activities (5,383) (2,903)
FINANCING ACTIVITIES
Decrease in short-term borrowings (359) (261)
Repayment of long-term debt (134) (314)
Repurchase of common shares (202) (1,617)
Exercise of stock options 2,936 1,867
------------------
Cash provided (used) by financing activities 2,241 (325)
Effect of exchange rate changes 59 84
------------------
Increase in cash and cash equivalents 12,292 11,985
Cash and cash equivalents, beginning of period 30,821 63,262
------------------
Cash and cash equivalents, end of period $ 43,113 $ 75,247
==================
- ----------------------------------------------------------------------
Non-cash financing transaction:
Accrual of capital contribution
to SonoSight, Inc. 30,331 -
- ----------------------------------------------------------------------
See accompanying notes to condensed consolidated financial statements.
5
<PAGE>
ATL ULTRASOUND, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands)
1. Basis of Presentation
The accompanying condensed consolidated financial statements
include the accounts of ATL Ultrasound, Inc. (ATL), which
includes its subsidiaries and is referred to as the "Company".
The Company is a worldwide leader in the development,
manufacture, distribution and service of diagnostic medical
ultrasound systems and related accessories and supplies. The
Company sells its products to hospitals, clinics and physicians
for use in radiology, cardiology, women's health care, vascular,
musculoskeletal and intraoperative applications.
The accompanying condensed consolidated financial statements and
related notes have been prepared pursuant to the Securities and
Exchange Commission rules and regulations for Form 10-Q.
Accordingly, certain information and footnote disclosures
normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed
or omitted pursuant to such rules and regulations. The
accompanying condensed consolidated financial statements and
related notes should be read in conjunction with the consolidated
financial statements and notes thereto incorporated by reference
in the Company's 1997 Form 10-K.
The information furnished reflects, in the opinion of management,
all adjustments necessary for a fair presentation of the results
for the interim periods presented. Interim results are not
necessarily indicative of results for a full year.
2. Cash and Cash Equivalents
The Company considers short-term investments with maturity dates
of three months or less at the date of purchase to be cash
equivalents for purposes of the statement of cash flows.
3. Inventories
4/3/98 12/31/97
--------- ---------
Materials and work in progress $34,471 $36,717
Finished products 16,991 20,545
Demonstrator equipment 28,542 23,838
Customer service 17,303 17,577
--------- ---------
$97,307 $98,677
========= =========
6
<PAGE>
ATL ULTRASOUND, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands)
4. Per Share Data
In accordance with Statement of Financial Accounting Standards
(FAS) No. 128, Earnings Per Share, the Company has reported both
basic and diluted net income per common share for each period
presented. Basic earnings per share (EPS) is calculated based on
the weighted average number of common shares outstanding during
the period. The computation of diluted EPS includes the effect
of all dilutive potential common shares outstanding. Conversion
of dilutive potential common shares is assumed based on the
average market price of common shares outstanding during the
period. All previously reported EPS have been restated to
conform with the provisions of FAS 128.
The following schedule represents a reconciliation of the
numerators and denominators of the basic and diluted EPS
calculations for the first quarter of 1998 and 1997.
Q1 1998 Q1 1997
--------------------- ------------------
Income Shares EPS Income Shares EPS
--------------------- -------------------
Weighted-average shares outstanding 14,451 14,091
Weighted-average unvested
restricted stock (148) (120)
------ ------
Basic EPS $2,183 14,303 $0.15 $2,052 13,971 $0.15
Effect of dilutive securities:
Restricted stock 49 56
Common stock equivalents 658 809
------ ------
Diluted EPS $2,183 15,010 $0.15 $2,052 14,836 $0.14
Common stock equivalents totaling 11,000 and 150,000 shares in
the first quarter of 1998 and 1997, respectively, were excluded
from the calculation of diluted EPS as they were antidilutive.
5. Comprehensive Income
In June 1997, the Financial Accounting Standards Board issued FAS
No. 130, Reporting Comprehensive Income, which became effective
for fiscal years beginning after December 15, 1997. FAS 130
requires that an entity report an amount representing total
comprehensive income in condensed financial statements of interim
periods issued to Company shareholders. Reclassification of financial
statements for earlier periods provided for comparative purposes is
required.
7
<PAGE>
ATL ULTRASOUND, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands)
Comprehensive income represents the change in equity of a
business enterprise during a period from transactions and other
events and circumstances from non-owner sources and includes net
income as well as items referred to as other comprehensive income
or loss. For the periods presented, the only item of other
comprehensive income for the Company is the foreign currency
translation adjustment resulting from the consolidation of
foreign operations. The table below provides a reconciliation of
net income to total comprehensive income (loss) for each period
presented.
4/3/98 3/28/97
--------- ---------
Net income $2,183 $2,052
Foreign currency translation
adjustments resulting in other
comprehensive loss (1,022) (2,363)
--------- ---------
Comprehensive income (loss) $1,161 $(311)
========= =========
At April 3, 1998, the accumulated total of other comprehensive
loss relating to foreign currency translation adjustments was
$7,421.
6. Reclassifications
Certain amounts reported in the previous year have been
reclassified to conform to the 1998 presentation.
7. Distribution and Subsequent Event
On February 2, 1998, the Company approved a plan to spin-off its
handheld business division as an independent, publicly owned
company (SonoSight, Inc.) to its shareholders. A registration
statement on Form 10 was filed with the Securities and Exchange
Commission in the name of SonoSight, Inc. and became effective on
April 2, 1998. The spin-off was effected through a tax-free
distribution of SonoSight shares to ATL shareholders on April 6,
1998 (the "Distribution"). The Company's shareholders received
one share of SonoSight common stock for each three shares of the
Company's common stock held. In connection with the
Distribution, the Company contributed to SonoSight additional
funding of $18,000 in cash on the Distribution date and will
contribute $12,000 in cash in January 1999. The Company and
SonoSight have entered into a number of agreements to facilitate
the Distribution and the transition of the company to an
independent business.
8
<PAGE>
ATL ULTRASOUND, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(Dollars in thousands)
To date, there have been no revenues from the sale of handheld
ultrasound devices. The handheld business has been focused on the
research, development and commercialization of handheld
technology and all business activities, including U.S. Government
development contract funding, have been reported in the Company's
operating expenses. Handheld business division spending totaled
approximately $2,500 and $1,000, respectively, for the periods
ended April 3, 1998 and March 28, 1997. The EPS impact of the
handheld business net operating expenses was approximately $0.13
in the first quarter of 1998 and $0.05 in the first quarter of
1997. In connection with the Distribution, the Company incurred
stock distribution expenses of approximately $1,300. The EPS
impact of the stock distribution expenses was approximately $0.07
in the first quarter of 1998.
9
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
-----------------------------------------------------
Condition and Results of Operations
-----------------------------------
RESULTS OF OPERATIONS
---------------------
Three months ended
- ------------------------------------------------------------------------
(In millions except per share data) 4/3/98 3/28/97 % Change
- ------------------------------------------------------------------------
Revenues $105.4 $100.1 5.3%
Gross Profit $52.8 $47.8 10.5%
Operating Expenses $50.2 $45.4 10.5%
Net Income $2.2 $2.1 6.4%
Diluted Net Income per Share $0.15 $0.14 5.2%
- ------------------------------------------------------------------------
The Company reported net income of $2.2 million or $0.15 per
share in the first quarter of 1998 compared with net income of
$2.1 million or $0.14 per share in the first quarter of 1997.
The impact on net income and net income per share from the
SonoSight, Inc. stock distribution expenses was approximately
$1.0 million and $0.07 per share, respectively. All per share
amounts are stated on a diluted basis.
REVENUES AND GROSS PROFIT
The Company's worldwide revenues increased 5.3% to $105.4 million
in the first quarter of 1998 compared with $100.1 million in the
first quarter of 1997. Product sales increased by $4.3 million
or 5.5% in the first quarter of 1998 compared to the same period
in the prior year. The increase in product sales is primarily
attributable to strong worldwide demand for the Company's HDI
5000 and HDI 3000 systems, partially offset by the foreign
exchange impact of the stronger U.S. dollar on international
business and the sale of the Company's image management business
in the second quarter of 1997. Service revenues increased $1.0
million or 4.5% compared with the first quarter of 1997 due to
the continued growth in the worldwide installed base of ATL's
products.
Gross profit was $52.8 million in the first quarter of 1998, an
increase of $5.0 million compared with gross profit of $47.8
million in the same quarter of the prior year. Total gross
margin for the first quarter of 1998 increased to 50.1% compared
with 47.7% in the prior year. These increases are attributed to
favorable product mix shift reflecting the benefit of the
introduction of the Company's premium-performance HDI 5000 system
which began customer shipments in November 1997, ongoing cost
reduction programs and manufacturing efficiencies.
10
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
-----------------------------------------------------
Condition and Results of Operations (Continued)
-----------------------------------------------
OPERATING EXPENSES, NET
- -----------------------
Operating expenses increased to $50.2 million in the first
quarter of 1998 from $45.4 million in the same period of 1997.
Selling, general and administrative expenses were $33.7 million,
an increase of 11.0% over the first quarter of 1997. The
increase in selling, general, and administrative expenses
reflects higher sales volumes over the prior year, start-up costs
related to the establishment of a new subsidiary in Brazil,
increased handheld spending and increased market development
expenditures in Asia. These increases were partially offset by
the favorable impact of foreign exchange and the sale of the
Company's image management business. Research and development
(R&D) expenses increased 1.2% to $14.9 million in the first
quarter of 1998 compared with $14.8 million in the first quarter
of 1997. The increase in R&D expenses is primarily due to
increased expenditures related to the development of handheld
ultrasound technology offset by the sale of the Company's image
management business. The handheld business has been focused on
the research, development and commercialization of handheld
technology and all business activities, including U.S. Government
development contract funding, have been reported in the Company's
operating expenses. Handheld business division spending totaled
approximately $2.5 million and $1.0 million, respectively, for
the periods ended April 3, 1998 and March 28, 1997. The EPS
impact of the handheld business net operating expenses was
approximately $0.13 in the first quarter of 1998 and $0.05 in the
first quarter of 1997. Other expense, net was $1.6 million in
the first quarter of 1998 compared with $0.4 million in the same
period of the prior year. The increase in other expense, net is
primarily due to one-time stock distribution expenses of $1.3
million during the first quarter of 1998 for the spin-off of
SonoSight. The EPS impact of the stock distribution expenses was
approximately $0.07 in the first quarter of 1998.
INTEREST INCOME AND EXPENSE
- ---------------------------
The Company earned net interest income of $0.1 million during the
first quarter of 1998 compared with net interest income of $0.2
million during the same period in 1997. Net interest income
includes interest income earned on cash balances available for
investment and extended term receivables, offset by interest
expense on long-term debt. 1997 interest expense also includes
post-judgment interest expense accrued on patent litigation
damages which were fully paid in the fourth quarter of 1997.
TAXES AND NET INCOME
- --------------------
For the first quarters of 1998 and 1997, the Company reported
income tax expense of $0.5 million, which represents a 20%
effective tax rate for U.S. federal, state and foreign income.
11
Item 2. Management's Discussion and Analysis of Financial
-----------------------------------------------------
Condition and Results of Operations (Continued)
-----------------------------------------------
CAPITAL RESOURCES AND LIQUIDITY
-------------------------------
-----------------------------------------------------
(In millions) 4/3/98 12/31/97
-----------------------------------------------------
Cash and cash equivalents $43.1 $ 30.8
Total Assets $357.2 $361.8
Long-term debt $12.2 $ 12.3
Shareholders' Equity $203.8 $229.7
-----------------------------------------------------
Cash and cash equivalents totaled $43.1 million at April 3, 1998
compared with $30.8 million at December 31, 1997. As shown in
the Condensed Consolidated Statement of Cash Flows, during the
first quarter of 1998, the Company generated $15.4 million from
operating activities while financing activities provided cash of
$2.2 million. At April 3, 1998, receivables, net, decreased
$18.0 million and accounts payable and accrued expenses decreased
$13.6 million from December 31, 1997 reflecting seasonally high
activity levels in the fourth quarter of 1997. During the first
quarter of 1998, cash of $2.9 million was generated from the
exercise of employee stock options.
The Company repurchased 5,000 shares of its own common stock in
the open market for $0.2 million during the first quarter of 1998
under repurchase programs intended to service the Company's
benefit programs. In anticipation of the planned spin-off of
SonoSight, the Company temporarily suspended all share repurchase
activities. The Company repurchased 343,000 shares totaling
$11.9 million in 1997. In May 1997, the Board of Directors
authorized the Company to purchase up to 1,000,000 shares of its
common stock, subject to certain criteria.
In addition to its cash balances, the Company has available
domestic credit facilities of $35 million, including a committed
line of credit of $25 million. Barring any unforeseen
circumstances or events, management expects existing cash,
available credit lines and funds from operations to be sufficient
to meet the Company's operating requirements for 1998 (see
Forward Looking Information).
The Company began construction of a new 101,000 square foot
building on its corporate campus in August 1997. The building's
projected completion date is scheduled for July 1998 and has an
estimated cost of $15 to $16 million. Initial funding for the
project has come from working capital and will transition to long-
term debt as the building reaches completion in 1998.
The Company spun-off its handheld business on April 6, 1998 (the
"Distribution"). In connection with the spin-off, the Company
contributed capital of $18 million in cash on the Distribution
date and will contribute an additional $12 million in cash in
January 1999 (see Note 7 to the Condensed Consolidated Financial
Statements, Distribution and Subsequent Event).
12
<PAGE>
Item 2. Management's Discussion and Analysis of Financial
-----------------------------------------------------
Condition and Results of Operations (Continued)
-----------------------------------------------
FORWARD LOOKING INFORMATION
- ---------------------------
As an update to the forward looking information provided in the
Company's 1997 Annual Report to Shareholders, the Company
provides the following information.
The Company expects revenues in the second quarter of 1998 to
approximate $109 to $111 million with a gross margin in excess of
50%. Excluding handheld operating expenses, operating expenses
are anticipated to increase about 10% during this period as a
result of higher sales volumes, continuing infrastructure build-
up in Latin America and the timing of various programs and
strategies. EPS for the second quarter is expected to be in the
range of $0.29 to $0.32 per share. The Company believes it will
continue to make progress towards its goal of achieving a return
on equity of 15% by the end of 1998.
The above statements and other statements in this report
identified by cross reference to this section are forward looking
statements that involve a number of risks and uncertainties and
should be read in conjunction with the Company's 1997 Annual
Report to Shareholders, which is incorporated by reference to the
Company's 1997 Form 10-K, and the Company's news releases. Among
the ongoing factors that could cause actual results to differ
materially from the above are the following considerations. The
ultrasound market in some European countries remains sluggish and
certain Asian markets are affected by turbulent economic
conditions, which may cause revenue growth to fall short of
expectations. Worldwide competition in the ultrasound market has
intensified over the past year, and most of the Company's
competitors have introduced new ultrasound products within the
past two years. The time required for customers to evaluate the
many new products on the market may lengthen the sales cycle for
ultrasound purchases, and the Company may lose sales to other
product offerings. These factors may adversely impact the
Company's sales volume or selling prices or both. Unanticipated
events, such as delays in the Company's product development and
cost reduction programs, the unavailability of components
critical to the Company's products due to natural disasters,
changes in vendor businesses or otherwise, economic instability
in Asian and other markets, the stronger U.S. dollar, delays in
receiving necessary regulatory approvals, or other unforeseen
events could adversely impact the Company's financial results for
1998.
13
<PAGE>
PART II Other Information
- ------- -----------------
Item 1. Legal Proceedings - None
-----------------
Item 2. Changes in Securities - None.
---------------------
Item 3. Defaults Upon Senior Securities - None.
-------------------------------
Item 4. Submission of Matters to a Vote of Security Holders - None.
---------------------------------------------------
Item 5. Other Information - None.
-----------------
Item 6. Exhibits and Reports on Form 8-K
--------------------------------
(a) Exhibits - Financial Data Schedule
(b) Reports of Form 8-K - None.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned thereunto duly authorized.
ATL ULTRASOUND, INC.
(Registrant)
Date: May 14, 1998 BY:/s/Pamela L. Dunlap
-----------------------
Pamela L. Dunlap
Senior Vice President
Finance and Administration
and Chief Financial Officer
14
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONDENSED CONSOLIDATED BALANCE SHEET AS OF APRIL 3, 1998 AND THE
CONDENSED CONSOLIDATED STATEMENT OF OPERATION FOR THE THREE MONTHS ENDED
APRIL 3, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANICIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-1-1998
<PERIOD-END> APR-3-1998
<CASH> 43,113
<SECURITIES> 0
<RECEIVABLES> 117,243
<ALLOWANCES> 0
<INVENTORY> 97,307
<CURRENT-ASSETS> 275,229
<PP&E> 76,380
<DEPRECIATION> 0
<TOTAL-ASSETS> 357,242
<CURRENT-LIABILITIES> 120,215
<BONDS> 12,166
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 357,242
<SALES> 81,999
<TOTAL-REVENUES> 105,416
<CGS> 38,315
<TOTAL-COSTS> 52,619
<OTHER-EXPENSES> 50,209
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 286
<INCOME-PRETAX> 2,728
<INCOME-TAX> 545
<INCOME-CONTINUING> 2,183
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,183
<EPS-PRIMARY> .15
<EPS-DILUTED> .15
</TABLE>
