<PAGE>
FORM 10-QSB
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________________________________
(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, 1996
-------------------
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 NO. 1-10677
-------
DRCA MEDICAL CORPORATION
------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
TEXAS 76-0203483
- ------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
Three Riverway, Suite 1430, Houston, Texas 77056
-------------------------------------------------
(Address of principal executive offices)
(713) 439-7511
----------------------------------------------
(Registrant's telephone number, including area code)
None
---------------------
(Former Name, Address and fiscal year, if changed since last report)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15 (d) of the 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 [ ]
As of September 30, 1996, 5,285,975 shares of Common Stock were outstanding.
Transitional Small Business Disclosure Format (Check One) YES [ ] NO [X]
<PAGE>
DRCA MEDICAL CORPORATION
INDEX
<TABLE>
<CAPTION>
Page
No.
----
<S> <C>
PART I FINANCIAL INFORMATION
Item 1 Financial Statements
Consolidated Balance Sheets (September 30, 1996
and December 31, 1995) 1
Consolidated Statements of Operations for the
three months and nine months ended
September 30, 1996 and September 30, 1995 2
Consolidated Statements of Changes in
Stockholders' Equity for the nine months
ended September 30, 1996 and September 30, 1995 3
Consolidated Statements of Cash Flows for
the nine months ended September 30, 1996 and
September 30, 1995 4
Notes to Consolidated Financial Statements 5 - 6
Item 2 Management's Discussion and Analysis of
Financial Condition and Results of Operations 7 - 9
PART II OTHER INFORMATION
Item 1 - 6 10
SIGNATURES 11
</TABLE>
<PAGE>
DRCA MEDICAL CORPORATION
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
<TABLE>
<CAPTION>
ASSETS September 30, December 31,
- ------ 1996 1995
------------- -------------
(Unaudited) (Audited)
<S> <C> <C>
CURRENT ASSETS
Cash and equivalents $ 1,160,041 $ 109,231
Accounts receivable, net 7,343,605 5,552,158
Income taxes receivable - 404,717
Notes receivable, net 109,010 235,801
Other current assets 242,377 147,855
----------- -----------
TOTAL CURRENT ASSETS 8,855,033 6,449,762
----------- -----------
PROPERTY AND EQUIPMENT
Equipment (including equipment under capital leases) 4,747,787 5,531,709
Leasehold improvements 448,840 437,676
Furniture and fixtures 403,688 368,962
Vehicles 113,509 108,301
----------- -----------
5,713,824 6,446,648
Less - accumulated depreciation and amortization (3,793,926) (3,999,252)
----------- -----------
1,919,898 2,447,396
----------- -----------
INTANGIBLES ASSETS, NET 812,965 904,161
----------- -----------
OTHER ASSETS 39,852 49,620
----------- -----------
TOTAL ASSETS $11,627,748 $ 9,850,939
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
--------------------------------------
CURRENT LIABILITIES
Accounts payable $ 1,140,483 $ 1,166,557
Accrued expenses 1,239,289 683,868
Deferred income taxes 392,638 208,168
Current obligations under capital leases 56,718 139,103
Current portion of notes payable 544,777 1,597,224
----------- -----------
TOTAL CURRENT LIABILITIES 3,373,905 3,794,920
----------- -----------
NOTES PAYABLE 454,290 905,890
OBLIGATIONS UNDER CAPITAL LEASES 106,234 117,504
DEFERRED INCOME TAXES 156,586 156,586
----------- -----------
4,091,015 4,974,900
----------- -----------
STOCKHOLDERS' EQUITY
Common stock, $.001 par value, 50,000,000
shares authorized, 5,301,808 issued 5,302 5,302
Preferred stock, $.01 par value 10,000,000
shares authorized.
Series A - 8% Cumulative Convertible, 25,226
shares issued and outstanding 252 -
Additional paid-in capital 4,848,279 2,470,570
Retained earnings 2,682,916 2,400,183
Treasury shares, 15,833 shares (16) (16)
----------- -----------
TOTAL STOCKHOLDERS' EQUITY 7,536,733 4,876,039
=========== ===========
COMMITMENTS AND CONTINGENCIES
----------- -----------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $11,627,748 $ 9,850,939
=========== ===========
</TABLE>
The accompanying notes are an integral part of this statement.
1
<PAGE>
DRCA MEDICAL CORPORATION
CONSOLIDATED STATEMENT OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended Quarters Ended
--------------------------- -------------------------------
September 30, September 30, September 30 September 30
1996 1995 1996 1995
------------- ------------- ------------ ------------
<S> <C> <C> <C> <C>
REVENUES $12,264,848 $11,790,765 $4,063,467 $4,229,706
Costs and expenses:
Compensation costs and
medical services 5,409,815 4,760,424 1,836,022 1,752,731
Other direct costs 2,810,247 2,675,250 1,006,787 991,922
Selling, general and administrative 1,812,357 1,679,575 599,427 569,906
Depreciation and amortization 580,007 852,945 232,786 275,595
Provision for doubtful accounts 898,711 514,585 241,600 297,403
----------- ----------- ---------- ----------
INCOME FROM OPERATIONS 753,711 1,307,986 146,845 342,149
Loss on sale of subsidiary (90,460) - - -
Minority interest - 33,654 - -
Interest expense (101,978) (227,633) (7,244) (75,376)
----------- ----------- ---------- ----------
INCOME BEFORE INCOME TAXES 561,273 1,114,007 139,601 266,773
Provision for income taxes (202,239) (427,603) (59,820) (106,543)
----------- ----------- ---------- ----------
NET INCOME $ 359,034 $ 686,404 $ 79,781 $ 160,230
=========== =========== ========== ==========
Earnings per common and
equivalent share:
Primary $.05 $.13 $ .01 $ .03
=========== =========== ========== ==========
Fully Diluted $.05 $.13 $ .01 $ .03
=========== =========== ========== ==========
</TABLE>
The accompanying notes are an integral part of this statement.
2
<PAGE>
DRCA MEDICAL CORPORATION
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
(UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996
<TABLE>
<CAPTION>
Common Stock Preferred Stock Additional
--------------------- ------------------- Paid In Retained Treasury
Shares Amount Shares Amount Capital Earnings Stock Total
---------- --------- ------- ---------- ---------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Balance -
December 31, 1995 5,301,808 $ 5,302 $ $ $2,470,570 $2,400,183 $ (16) $4,876,039
For services rendered (144,636) (144,636)
Issuance of Preferred
Stock - Series A 25,226 $ 252 2,522,345 2,522,597
Dividends - Preferred
Stock - Series A (76,301) (76,301)
Net income 359,034 359,034
---------- --------- ------- ---------- ---------- ----------- ----------- -----------
Balance -
September 30, 1996 5,301,808 $ 5,302 25,226 $ 252 $4,848,279 $2,682,916 $ (16) $7,536,733
========= ======== ======= ========== ========== ========== ========== ==========
</TABLE>
The accompanying notes are an integral part of this statement.
3
<PAGE>
DRCA MEDICAL CORPORATION
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996 AND SEPTEMBER 30, 1995
<TABLE>
<CAPTION>
September 30 September 30
1996 1995
------------- ------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 359,034 $ 686,404
Noncash adjustments:
Depreciation and amortization 580,007 826,786
Minority interest - (33,654)
Loss on sale of assets 90,460 -
Change in assets and liabilities,
excluding acquisitions:
Accounts receivable, net (1,791,447) (1,660,940)
Other current assets (94,522) (233,270)
Other assets 9,768 7,788
Accounts payable (26,075) (363,307)
Accrued expenses 555,421 315,563
Income taxes receivable/payable 589,187 (42,701)
----------- -----------
Net cash provided (used) by operating
activities 271,833 (497,331)
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (402,027) (55,999)
Net proceeds from sale of subsidiary 700,000 -
Issuance of notes receivable - (500,000)
Collections on notes receivable 126,791 538,832
----------- -----------
Net cash provided (used) by investing
activities 424,764 (17,167)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Bank borrowings - 501,577
Payments on bank borrowings (401,577) -
Proceeds from issuance of notes
payable - 1,451,353
Payments on other notes, net (1,416,065) (1,893,756)
Payments on capital lease
obligations (129,805) (310,995)
Issuance of preferred stock, net of offering
costs 2,377,961 -
Distribution to limited partners - (17,712)
Accrued dividends (76,301) -
----------- -----------
Net cash provided (used) by financing
activities 354,213 (269,533)
----------- -----------
NET CHANGE IN CASH AND EQUIVALENTS
CASH AND EQUIVALENTS: 1,050,810 (784,031)
BEGINNING OF YEAR 109,231 813,942
----------- -----------
END OF QUARTER $ 1,160,041 $ 29,911
=========== ===========
SUPPLEMENTAL DISCLOSURES:
Interest paid $ 109,908 $ 243,457
Income taxes paid/(recovered) (416,653) 405,000
Property and equipment acquired
with debt 349,745 -
</TABLE>
The accompanying notes are an integral part of this statement.
4
<PAGE>
DRCA MEDICAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
SEPTEMBER 30, 1996
NOTE 1 BASIS OF PRESENTATION:
------ ----------------------
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-QSB. 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 only of those of a normal
recurring nature) considered necessary for a fair presentation have been
included. Operating results for the nine month period ended September 30, 1996
are not necessarily indicative of the results that may be expected for the year
ending December 31, 1996. For further information, refer to the consolidated
financial statements and footnotes thereto included in the Company's annual
report on Form 10-KSB for the year ended December 31, 1995.
The preparation of consolidated financial statements in accordance with
generally accepted accounting principles requires management to make estimates
and assumptions that affect the reported amounts of assets, liabilities,
revenues and expenses, as well as the disclosures of contingent assets and
liabilities. Because of the inherent uncertainties in this process, actual
future results could differ from those expected at the reporting date.
Certain amounts in the September 30, 1995 consolidated statements of operations
have been reclassified to conform to the September 30, 1996 presentation, the
most significant of which is an allocation of a portion of the provision for
doubtful accounts to contractual allowances to more properly reflect revenue
from services rendered to personal injury claimants at the net amounts expected
to be collected upon claim adjudication. The reclassification was based on
improved historical information and currently expected recovery rates. In
addition, selected natural expense classifications have been presented to
enhance industry comparability. None of these changes affected net income or
loss.
NOTE 2 EARNINGS PER COMMON SHARE:
------ -------------------------
Primary earnings per common share is computed by dividing net income reduced by
preferred dividends by the weighted average number of shares of common stock
and dilutive common stock equivalents outstanding during the period. Common
equivalents include stock options and warrants.
Fully diluted earnings per common share is the more dilutive result of the
following alternate calculations: (1) Reduce net income by preferred stock
dividends, producing earnings available for common shareholders (EACS). Divide
EACS by the weighted average of common stock and dilutive common stock
equivalents outstanding during the period; or (2) Calculate fully diluted
shares by adding the weighted average of common and dilutive common stock
equivalents outstanding plus the number of shares of common stock which would
be issued assuming the conversion of the convertible preferred stock and
accrued dividends thereon into common stock. Divide net income by fully
diluted shares.
5
<PAGE>
<TABLE>
<CAPTION>
THREE MONTHS ENDED
----------------------------
September 30, September 30,
1996 1995
-------------- -------------
<S> <C> <C>
Primary
Weighted average of common shares
and common stock equivalents 5,466,407 5,412,396
========== ==========
Net Income $ 79,781 $ 160,230
Preferred dividends (50,867) 0
---------- ----------
Earnings available for common shareholders 28,914 160,230
========== ==========
Earnings Per Share $ .01 $ .03
========== ==========
Fully diluted
Weighted average of common shares
and common stock equivalents 5,466,407 5,412,396
========== ==========
Net Income $ 79,781 $ 160,230
Preferred dividends (50,867) 0
---------- ----------
Earnings available for common shareholders 28,914 160,230
========== ==========
Earnings Per Share $ .01 $ .03
========== ==========
NINE MONTHS ENDED
---------------------------
September 30, September 30,
1996 1995
-------------- -------------
Primary
Weighted average of common shares
and common stock equivalents 5,466,407 5,357,251
========== ==========
Net Income $ 359,034 $ 686,404
Preferred dividends (76,300) 0
---------- ----------
Earnings available for common shareholders 282,734 686,404
========== ==========
Earnings Per Share $ .05 $ .13
========== ==========
Fully diluted
Weighted average of common shares
and common stock equivalents 5,466,407 5,445,342
========== ==========
Net Income $ 359,034 $ 686,404
Preferred dividends (76,300) -
---------- ----------
Earnings available for common shareholder 282,734 686,404
========== ==========
Earnings Per Share $ .05 $ .13
========== ==========
</TABLE>
6
<PAGE>
PART I
FINANCIAL INFORMATION
Item 2 Management's Discussion and Analysis of Financial Condition and Results
of Operations.
RESULTS OF OPERATIONS:
In March 1995, the Company assisted in the formation of a Houston based medical
group. Upon its formation, the new medical group encompassed all of the
Company's Houston-based clinical and ancillary service operations as well as
two orthopedic clinics which joined with the group at its formation. The third
quarter of 1995 and 1996 each include three months of the new group's
operations. The nine month period ended September 30, 1995 includes only seven
months of the new group and is, therefore, not directly comparable to 1996
results. In November 1995, the Company stopped operating one of its clinics in
Little Rock, Arkansas and subleased the facility and equipment to a third
party. In March 1996, the Company sold a subsidiary in Little Rock, Arkansas
which included the Company's MRI clinic and other assets. Results of
operations of both the clinic under sublease and the subsidiary were included
in the results for the three and nine months ended September 30, 1995. The
discontinuation of these operations saved over $58,000 in the quarter ended
September 30, 1996, an annualized savings of over $232,000 as compared to the
financial performance of these operations as of their discontinuance.
THREE MONTHS ENDED SEPTEMBER 30, 1996 COMPARED WITH THREE MONTHS ENDED
SEPTEMBER 30, 1995.
Revenues.
Revenues for the third quarter decreased by $166,239 (4%) as compared to the
same period in 1995. Revenues from orthopedics practices increased $356,728
(46%) while other on-going clinical and ancillary service revenues decreased by
approximately $322,000. An additional reduction in revenues of about $201,000
as compared to 1995 is attributable to 1995 operations which were discontinued
prior to September 30, 1996.
Compensation Costs and Medical Services and Other Direct Costs.
Compensation Costs and Medical Services increased by $83,291 (5%) and Other
Direct Costs increased by $14,865 (1%). These costs to operate the orthopedics
practices rose by $177,356.
Selling, General and Administrative Expenses.
Expenses increased by $29,521. Wages increased by $40,969 mainly due to
increased staffing and other expenses decreased by $11,448.
Depreciation and Amortization.
Expenses decreased due mainly to the sale of a wholly-owned subsidiary in
March, 1996, and because of the full amortization of a four-year non-compete
agreement as of December, 1995.
7
<PAGE>
Provision for Doubtful Accounts.
Expenses decreased in 1996 mainly due to the decrease in revenues and to the
net change in the year-to-date estimate of the allowance for doubtful accounts
relating to gross accounts receivable as of September 30, 1996 (See Part I,
Note 1).
Interest Expense.
Interest expense decreased by $68,132, mainly due to the reduction of the
principal balances on various notes and capital lease obligations, a portion of
which resulted from the retirement of debt associated with the sale of a
wholly-owned subsidiary in March, 1996.
NINE MONTHS ENDED SEPTEMBER 30, 1996 COMPARED WITH NINE MONTHS ENDED SEPTEMBER
30, 1995.
Revenues.
Revenues for the first nine months of 1996 increased $474,083 (4%) over the
same period in 1995. Revenues from orthopedics practices rose $1,373,523 (75%).
Other on-going clinical and ancillary service revenues were lower by
approximately $314,000 while an additional reduction of about $585,000 is
attributable to the revenues of operations which were discontinued prior to
this report.
Compensation Costs and Medical Services and Other Direct Costs.
Compensation Costs and Medical Services rose by $649,391 (14%) and Other Direct
Costs increased $134,997 (5%). These costs to operate the orthopedics
practices increased $604,074.
Selling, General and Administrative Expenses.
Expenses increased by $132,782 or about 8%. Legal, accounting and professional
fees increased by about $56,000 mainly for expenses related to issuance of a
subordinated note which was converted into Series A Preferred Stock, changing
the Company's Articles of Incorporation, and the sale of a wholly-owned
subsidiary of the Company. About $18,000 of the increase was incurred in the
Company's continuing efforts to expand into new geographic markets. The
remainder of the increase is attributed to normal variances based principally
on the Company's increased revenues.
Depreciation and Amortization.
Expenses decreased mainly due to the sale of a wholly-owned subsidiary in
March, 1996, and because of the full amortization of a four year non-compete
agreement as of December 31, 1995.
Provision for Doubtful Accounts.
Expenses increased in 1996 due to an increase in the Company's revenues, and to
an increase in the allowance for claims billed to third-party payors.
Loss on Sale of Subsidiary.
The Company recorded a loss on the sale of a wholly-owned subsidiary in March,
1996. Proceeds from the sale were sufficient to retire the Company's
liabilities related to the subsidiary.
8
<PAGE>
Minority Interest.
Minority interest in income decreased by $33,654 due to the Company's winding
down of all partnership interests.
Interest Expense.
Interest expense decreased by $125,655, mainly due to the reduction of the
principal balances on various notes and capital lease obligations, a portion of
which resulted from the retirement of debt associated with the sale of a
wholly-owned subsidiary in March, 1996.
LIQUIDITY AND CAPITAL RESOURCES
In April, 1996, the Company issued a $2.5 million convertible subordinated note
to provide acquisition and working capital in support of the Company's planned
expansion. At the Company's annual shareholders' meeting on May 9, 1996, over
two-thirds of the Company's shareholders approved the creation of 10,000,000
shares of preferred stock. Immediately thereafter, the Company's board of
directors approved the issuance of 25,226 shares of the Company's Series A
Preferred Stock in exchange for the $2.5 million convertible subordinated note
plus $22,603 in accrued interest thereon. Net proceeds to the Company after
offering costs were $2,377,961. The Company has plans to expand its physician
practice management services through the acquisition of orthopedic and
orthopedics-related medical practice assets and through the acquisition or
development of musculoskeletal injury- and illness-related ancillary services
required by these medical practices. Depending upon the Company's experience in
this expansion program, additional sources of acquisition and working capital
may be required.
The Company makes continuing estimates of the collectibility of patient
billings as part of its normal accounting procedure (See Part I, Note 1).
Estimates are reviewed and revised on an on-going basis as reimbursements are
received and recorded against accounts receivable. In conjunction with this
process, the Company has recorded a larger allowance for uncollectible accounts
receivable than that recorded in prior periods. This also resulted in an
increased provision for doubtful accounts expense as compared to that recorded
for the first nine months of 1995. Liquidity and expenses could be impacted by
future changes in the estimate of collectibility of the Company's accounts
receivable. Although currently due, accounts receivable from personal injury
claims usually take significantly longer to collect than claims billed to
insurance carriers and employers. The net collectibility of personal injury
revenues is generally on par with other payors, however, the passage of time
between treatment and final adjudication of the claim, as well as the inherent
uncertainty of the judicial process and its impact on settlement of personal
injury claims, makes estimates of collectibility on these accounts subject to
future revision. The percentage of net accounts receivable attributable to
personal injury claims is approximately 37%, as compared to 43% at the end of
the last fiscal year.
The Company's working capital at September 30, 1996 was $5,481,128 as compared
to $2,654,842 on December 31, 1995, an increase of $2,826,286. This increase
is principally due to the Company's receipt of net proceeds of $2,377,961 from
the issuance of the Series A Preferred Stock in 1996, the retention of earnings
for the nine month period ending September 30, 1996 and the retirement of the
current portion of a note payable related to the sale of a wholly-owned
subsidiary in March, 1996.
9
<PAGE>
PART II
OTHER INFORMATION
Item 1 Legal Proceedings
The Company is not a party to any pending litigation other than routine
litigation incidental to the business or that which is immaterial in
amount of damages sought.
Item 2 Changes in Securities
This item is not applicable.
Item 3 Defaults upon Senior Securities
This item is not applicable.
Item 4 Submission of Matters to a Vote of Security Holders
This item is not applicable.
Item 5 Other Information
This item is not applicable.
Item 6 (a) Exhibits and Exhibit Index
This item is not applicable.
(b) Reports on Form 8-K
This item is not applicable.
10
<PAGE>
SIGNATURES
In accordance with Section 13 or 15(d) of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned, thereunto
duly authorized.
DRCA MEDICAL CORPORATION
By: /s/ JOSE E. KAUACHI
--------------------------------
JOSE E. KAUACHI,
Chairman of the Board, President and
Chief Executive Officer
Dated: November 13, 1996
In Accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates indicated:
<TABLE>
<CAPTION>
Signature Title Date
--------- ----- ----
<S> <C> <C>
By: /s/ JOSE E. KAUACHI Chairman of the Board, President November 13, 1996
---------------------------- and Chief Executive Officer
JOSE E. KAUACHI
By: /s/ JEFFERSON R. CASEY Senior Vice President, Treasurer November 13, 1996
--------------------------- (Principal Financial & Accounting
JEFFERSON R. CASEY Officer), and Secretary
</TABLE>
11
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 1,160,041
<SECURITIES> 0
<RECEIVABLES> 8,143,987
<ALLOWANCES> 800,382
<INVENTORY> 0
<CURRENT-ASSETS> 8,855,033
<PP&E> 5,713,824
<DEPRECIATION> 3,793,926
<TOTAL-ASSETS> 11,627,748
<CURRENT-LIABILITIES> 3,373,905
<BONDS> 1,162,019
252
0
<COMMON> 5,302
<OTHER-SE> 7,531,179
<TOTAL-LIABILITY-AND-EQUITY> 11,627,748
<SALES> 12,264,848
<TOTAL-REVENUES> 12,264,848
<CGS> 11,511,137
<TOTAL-COSTS> 11,511,137
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 898,711
<INTEREST-EXPENSE> 101,978
<INCOME-PRETAX> 561,273
<INCOME-TAX> 202,239
<INCOME-CONTINUING> 359,034
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 359,034
<EPS-PRIMARY> .05
<EPS-DILUTED> .05
</TABLE>
