<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D. C. 20549
[X] Quarterly report pursuant to section 13 or 15(d) of the Securities Exchange
Act of 1934 For the quarterly period ended SEPTEMBER 30, 1999 or
[ ] Transition report pursuant to section 13 or 15(d) of the Securities Exchange
Act of 1934 For the transition period from ______ to ______
1-9731
(COMMISSION FILE NO.)
ARRHYTHMIA RESEARCH TECHNOLOGY, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
DELAWARE 72-0925679
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
1101 SOUTH CAPITAL OF TEXAS HIGHWAY
BUILDING G - SUITE 200
AUSTIN, TEXAS 78746
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICE) (ZIP CODE)
(512) 347-9640
(REGISTRANT'S 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 .
--- ---
As Of September 30, 1999, there were 3,439,310 shares of common stock
outstanding.
This report consists of 10 pages.
<PAGE>
ARRHYTHMIA RESEARCH TECHNOLOGY, INC.
TABLE OF CONTENTS
FORM 10-Q
September 30, 1999
<TABLE>
<CAPTION>
<S> <C>
PART I - FINANCIAL INFORMATION.......................................................................................3
Item 1. Financial Statements....................................................................................3
CONSOLIDATED BALANCE SHEETS......................................................................................3
CONSOLIDATED STATEMENTS OF OPERATIONS............................................................................4
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY.......................................................5
CONSOLIDATED STATEMENTS OF CASH FLOWS............................................................................6
SUPPLEMENTAL NOTES TO CONSOLIDATED FINANCIAL STATEMENTS..........................................................7
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations..................7
PART II - OTHER INFORMATION.........................................................................................10
Item 1. Legal Proceedings - none...............................................................................10
Item 2. Changes in Securities - none...........................................................................10
Item 3. Defaults Upon Senior Securities - none.................................................................10
Item 4. Submission of Matters to a Vote of Security Holders - none.............................................10
Item 5. Other Information - none...............................................................................10
Item 6. Exhibits and Reports on Form 8-K - none................................................................10
SIGNATURES......................................................................................................10
</TABLE>
2
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
CONSOLIDATED BALANCE SHEETS
ARRHYTHMIA RESEARCH TECHNOLOGY, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Unaudited)
<TABLE>
<CAPTION>
September 30, December 31,
ASSETS 1999 1998
------------ ------------
<S> <C> <C>
Current assets:
Cash and cash equivalents ........................................................ $ 695,969 $ 557,533
Trade and other accounts receivable, net of allowance for doubtful accounts
of $49,192 and $72,192 ..................................................... 1,746,659 1,307,668
Inventories, net ................................................................. 1,177,236 1,472,726
Income Tax Recoverable ........................................................... 262,810 262,810
Other current assets ............................................................. 55,763 70,105
------------ ------------
Total current assets ........................................................... 3,938,438 3,670,842
Property and equipment, net of accumulated depreciation of $3,524,780 & $3,005,634 . 3, 932,432 3,988,766
Patent and software development costs, net of accumulated amortization of $490,226 .
and $457,204 ................................................................ 197,114 97,998
Goodwill, net of accumulated amortization of $854,131 & $756,084 ................... 1,619,195 1,717,242
Deferred income taxes, net ......................................................... 374,923 374,923
Other assets ....................................................................... 62,157 140,373
------------ ------------
Total assets ................................................................... $ 10,124,258 $ 9,990,144
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Revolving credit facilities ...................................................... $ 0 $ 0
Current maturities of bonds payable and long-term debt ........................... 125,165 356,751
Current maturities of capital lease obligations .................................. 7,328 28,220
Accounts payable ................................................................. 598,788 681,276
Accrued liabilities and Other Liabilities ........................................ 476,044 322,798
------------ ------------
Total current liabilities ...................................................... 1,207,323 1,389,045
Bonds payable, and other long-term debt, net of current maturities ................. 601,810 565,810
Capital lease obligations, net of current portion .................................. 49,341 49,341
Deferred revenue ................................................................... 21,273 27,036
------------ ------------
Total liabilities .............................................................. 1,879,747 2,031,232
------------ ------------
Shareholders' equity:
Preferred stock, $1 par value; 2,000,000 shares authorized, none issued .......... - -
Common stock, $.01 par value; 10,000,000 shares authorized;
3,679,216 issued ............................................................. 36,792 36,792
Additional paid-in-capital ......................................................... 8,909,307 8,909,307
Common stock held in treasury, 219,715 and 144,515 shares at cost .................. (1,031,814) (913,084)
Unearned ESOP compensation ......................................................... (7,134) (39,277)
Retained earnings (accumulated deficit) ............................................ 337,361 (34,826)
Total shareholders' equity ..................................................... 8,244,512 7,958,912
------------ ------------
Total liabilities and shareholders' equity ..................................... $ 10,124,258 $ 9,990,144
------------ ------------
------------ ------------
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
3
<PAGE>
ARRHYTHMIA RESEARCH TECHNOLOGY, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Sept. 30, Nine Months Ended Sept. 30,
------------------------------- -------------------------------
1999 1998 1999 1998
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Net sales ................................... $ 2,609,674 $ 2,323,001 $ 7,974,128 $ 7,597,345
Cost of sales ............................... 1,474,603 1,407,435 5,016,092 4,571,156
----------- ----------- ----------- -----------
Gross profit ................................ 1,135,071 915,566 2,958,036 3,026,189
----------- ----------- ----------- -----------
Selling and marketing ....................... 101,527 114,834 247,897 298,326
General and administrative .................. 568,756 549,883 1,607,335 1,628,553
Research and development .................... 54,581 90,142 121,236 302,346
Amortization of goodwill .................... 32,472 31,165 98,047 87,792
----------- ----------- ----------- -----------
Total expenses .............................. 757,337 786,025 2,074,516 2,317,018
----------- ----------- ----------- -----------
Income from operations ...................... 377,734 129,542 883,520 709,172
Other income (expense):
Interest expense .......................... 3,790 20,876 46,029 88,465
Other ..................................... 38,594 (8,963) 146,251 44,182
----------- ----------- ----------- -----------
Income before income taxes and other charges 335,349 117,628 691,239 576,524
Provision for Asset Impairment .............. 0 (47,328) 0 406,201
----------- ----------- ----------- -----------
Income (loss) before income taxes ........... 335,349 164,956 691,239 170,323
Income taxes (credit) ....................... 159,411 105,775 319,050 130,348
----------- ----------- ----------- -----------
Net income .................................. $ 175,938 $ 59,181 $ 372,189 $ 39,975
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Net income per share ........................ $ 0.05 $ 0.02 $ 0.11 $ 0.01
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
Weighted average number of common
and dilutive common equivalent
shares outstanding ........................ 3,439,310 3,563,101 3,439,310 3,563,101
----------- ----------- ----------- -----------
----------- ----------- ----------- -----------
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
4
<PAGE>
ARRHYTHMIA RESEARCH TECHNOLOGY, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY
<TABLE>
<CAPTION>
Retained
Common Shares Additional Unearned Earnings
------------------------ Paid-in Treasury ESOP (Accumulated
Number Amount Capital Stock Compensation Deficit) Total
----------- ---------- ----------- ----------- ------------ ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
January 1, 1996............ 3,564,511 $ 36,792 $ 8,899,261 $ (868,740) $ (167,848) $ (546,718) $ 7,352,747
Exercise of options........
Maturity and repurchases of
redeemable common stock.. 10,046 10,046
ESOP payments.............. 42,857 42,857
Treasury stock purchase.... (1,410) (10,047) (10,047)
Sale of securities......... 0
Net income................. 616,578 616,578
----------- ---------- ----------- ----------- ---------- ---------- -----------
December 31, 1996.......... 3,563,101 36,792 8,909,307 (878,787) (124,991) 69,860 8,012,181
Maturity and repurchases of
redeemable common stock..
Treasury stock purchase....
ESOP payments.............. 42,857 42,857
Net income................. 31,752 31,752
----------- ---------- ----------- ----------- ---------- ---------- -----------
December 31, 1997.......... 3,563,101 36,792 8,909,307 (878,787) (82,134) 101,612 8,086,790
Treasury stock purchase.... (28,400) (34,297) (34,297)
ESOP payments.............. 42,857 42,857
Net income................. (136,438) (136,438)
----------- ---------- ----------- ----------- ---------- ---------- -----------
December 31, 1998.......... 3,534,701 36,792 8,909,307 (913,084) (39,277) (34,826) 7,958,912
Treasury stock purchase.... (30,800) (30,840) (30,840)
ESOP payments.............. 10,714 10,714
Net income................. (1,131) (1,131)
----------- ---------- ----------- ----------- ---------- ---------- -----------
March 31, 1999............. 3,503,901 $ 36,792 $ 8,909,307 $ (943,924) $ (28,563) $ (35,957) $ 7,937,655
Treasury stock purchase.... (41,400) (48,570) (48,570)
ESOP payments.............. 10,715 10,715
Net income................. 197,382 197,382
----------- ---------- ----------- ----------- ---------- ---------- -----------
June 30, 1999.............. 3,462,501 $ 36,792 $ 8,909,307 $ (992,494) $ (17,848) $ 161,425 $ 8,097,182
Treasury stock purchase.... (23,191) (39,320) (39,320)
ESOP payments.............. 10,713 10,713
Net income................. 175,937 175,937
----------- ---------- ----------- ----------- ---------- ---------- -----------
September 30, 1999......... 3,439,310 $ 36,792 $ 8,909,307 $(1,031,814) $ (7,135) $ 337,362 $ 8,244,512
----------- ---------- ----------- ----------- ---------- ---------- -----------
----------- ---------- ----------- ----------- ---------- ---------- -----------
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
5
<PAGE>
ARRHYTHMIA RESEARCH TECHNOLOGY, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Eight Months Ended August 31,
--------------------------------
1999 1998
--------------- ---------------
<S> <C> <C>
Cash flows from operating activities:
Net Income ........................................................................ $ 372,189 $ 39,975
Provision for Asset Impairment .................................................... 0 406,201
Adjusted Net Income ............................................................... 372,189 446,176
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation .................................................................... 519,146 523,167
Amortization .................................................................... 131,068 117,584
Deferred Revenue ................................................................ 0 0
----------- -----------
Changes in assets and liabilities:
(Increase) Decrease in Trade and other accounts receivable, net ................. (438,991) 807,983
(Increase) Deposits, prepaid expenses and other current assets .................. 14,342 (50,280)
(Increase) Decrease in Inventories .............................................. 295,490 147,203
(Decrease) in Accounts payable, accrued liabilities and other current liabilities (240,773) (586,505)
Increase in Income taxes payable ................................................ 194,957 57,620
(Increase) Decrease in other assets ............................................. 0 (652)
----------- -----------
Net cash provided by operating activities ........................................... 847,428 1,462,297
----------- -----------
Cash flows from investing activities:
Net capital expenditures and fixed asset decrease ................................. (382,811) (335,134)
Deposits on capital equipment, acquisitions and other ............................. (1,784) 7,695
Patent and software development expenditures ...................................... (132,137) (17,917)
----------- -----------
Net cash used in investing activities ........................................... (516,733) (345,355)
----------- -----------
Cash flows from financing activities:
Net repayments of revolving credit facilities ..................................... 0 (467,135)
Increase in bonds payable due to amortization ..................................... 36,000 36,000
Reduction of unearned ESOP compensation ........................................... 32,143 32,143
Principal paid for on treasury stock .............................................. (118,730) (1)
Principal proceeds on long term debt, net ......................................... 0 0
Principal payments on long-term debt, net ......................................... (141,669) (198,751)
----------- -----------
Net cash used in financing activities ........................................... (192,256) (597,743)
----------- -----------
Net increase (decrease) in cash and cash equivalents ................................ 138,439 519,199
Cash and cash equivalents at beginning of period .................................... 557,533 214,938
----------- -----------
Cash and cash equivalents at end of period .......................................... $ 695,972 $ 734,137
----------- -----------
----------- -----------
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
6
<PAGE>
SUPPLEMENTAL NOTES TO FINANCIAL STATEMENTS
The unaudited interim consolidated financial statements and related
notes have been prepared pursuant to the rules and regulations of the Securities
and Exchange Commission. Accordingly, certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been omitted pursuant to such
rules and regulations. The accompanying unaudited interim consolidated financial
statements and related notes should be read in conjunction with the consolidated
financial statements and notes thereto included in the Company's most recent
Form 10-K covering the year ended December 31, 1998.
The information furnished reflects, in the opinion of the management of
Arrhythmia Research Technology, Inc. ("ART"), all adjustments necessary for a
fair presentation of the financial results for the interim period presented.
Interim results are subject to year-end adjustments and audit by
independent certified public accountants.
INVENTORIES:
Inventories consist of the following as of:
<TABLE>
<CAPTION>
SEPTEMBER 30, DECEMBER 31,
1999 1998
--------------- ---------------
<S> <C> <C>
Raw materials................................................... $ 249,707 $ 303,689
Work-in-process............................................... 171,586 330,812
Finished goods.................................................. 1,753,831 1,861,060
--------------- ---------------
Total...................................................... 2,175,074 2,495,561
Allowance for slow-moving inventories........................... (997,838) (1,022,835)
--------------- ---------------
Total...................................................... $ 1,177,236 $ 1,472,726
--------------- ---------------
--------------- ---------------
</TABLE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
At September 30, 1999, the Company had working capital of approximately
$2,746,000. The Company has a $3,500,000 working capital line of credit with a
bank, collateralized by accounts receivable and inventory of ART and Micron
Products Inc., which bears interest at prime plus .75% (9.0% at September 30,
1999). The working capital line of credit matures December 15, 1999 and did not
have an outstanding balance at September 30, 1999. The Company's lines of credit
are its primary source of operating funds and liquidity.
Capital expenditures during the first nine months of 1999 were
approximately $383,000 compared to $335,000 in 1998. Capital expenditures are
expected to increase in the fourth quarter as Micron anticipates needing to
purchase a new extruder if sales in the polymer operation continue to increase.
Normal capital expenditures are funded from operating cash flows.
RESULTS OF OPERATIONS
REVENUES for the third quarter ended September 30, 1999 were $2,364,858
when compared to $2,323,001 for the third quarter of 1998. The sales mix for the
Company continues with ECG sensors making up the greater portion of sales and
the related cost of sales. Until 1996, ART acted as the exclusive distributor of
electrophysiology ("EP") products under its contract with their manufacturer,
Prucka Engineering, Inc. During 1998, ART received a 4% commission on net sales
of EP systems and accessories sold anywhere in the world, up to a ceiling of
$10,000,000 in total annual net sales. From January 1, 1999 through December 31,
2002, ART will receive a commission of 3% of the net sales of CardioLab systems
sold anywhere in the world, up to a ceiling of $10,000,000 in total net sales.
For revenues attributable to Prucka products that exceed $10,000,000 in any
year, ART will be entitled to receive 25% of the 3% commission rate.
7
<PAGE>
Domestic and foreign sales for the first quarter are as follows:
<TABLE>
<CAPTION>
THIRD QUARTER FIRST NINE MONTHS
1999 % 1998 % 1999 % 1998 %
---- -- ---- -- ---- -- ---- --
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Domestic..... $ 846,495 32 $ 1,130,287 49 $ 3,352,208 42 $ 3,920,331 52
Foreign...... 1,763,179 68 1,192,714 51 4,621,920 58 3,677,014 48
----------- -- ----------- -- ----------- -- ----------- --
Total........ $ 2,609,674 100 $ 2,323,001 100 $ 7,974,128 100 $ 7,597,345 100
----------- --- ----------- --- ----------- --- ----------- ---
----------- --- ----------- --- ----------- --- ----------- ---
</TABLE>
COST OF SALES decreased by 9.7% for the quarter ended September 30,
1999, as compared to the same period in 1998, with overhead costs at Micron due
to reductions in repairs and maintenance, and in utility expenses.
SELLING AND MARKETING expenses decreased as a percent of sales during
the third quarter ended September 30, 1999 by 0.65% as compared to the same
period for 1998.
GENERAL AND ADMINISTRATIVE expenses dropped by $52,000 from 1998
numbers, with a reduction in salaries, environmental monitoring expenses,
professional fees and insurance costs.
RESEARCH AND DEVELOPMENT expenses decreased significantly by $35,600
for the third quarter ended September 30, 1999, as compared to the same period
in 1998. The decrease is mainly due a decrease in development costs at ART.
YEAR 2000
Arrhythmia Research Technology's (ART) company-wide Year 2000 Project
has been completed. The general year 2000 concern was that many computer systems
and software products would experience problems handling dates beyond the year
1999 because the systems are coded to accept only two-digit entries in the
century date fields. ART's executive staff has directed a centrally coordinated
Year 2000 Project Team, made up of representatives from each of the company's
departments and divisions, to address this issue. In 1998 this Project Team
began assessing and testing efforts addressing ART's products, services,
infrastructure, and internal business support applications. A detailed plan with
the goal to ensure that all ART's business process and systems are year 2000
ready has been created and implemented. All year 2000 readiness actions set
forth in this plan have been complete by October 1999.
THE PROJECT: The Arrhythmia Research Technology Year 2000 Project has
been addressed on two fronts. ART is a manufacturing and distributor of medical
products. These efforts were divided into four major sections, Company Products,
Infrastructure (Internal IT Systems), Internal Non-IT systems, and Supply-Chain.
The general phases common to all these sections were: (1) inventorying year 2000
items; (2) assigning priorities to identified items; (3) assessing the year 2000
readiness; (4) repairing or replacing items that are determined not to be year
2000 ready; and (5) testing. The company has engaged the service of an
Information Technology consulting firm, Micro Support Group, Inc., to assist in
the project management and implementation of the year 2000 plan.
PRODUCTS: The year in the date field of many of ART's software products
is in two digits and is only used as a reference to show when a test was
performed. These dates are not used in any analytical calculations, hence these
software products will not have operational failures, invalid or incorrect
results as a consequence of the year 2000 date change. Other products required
minor remediation involving the display of date data. Neither data integrity nor
product functionality was in jeopardy. These remediation have been successfully
incorporated in the products and made available to the installed user base.
Micron does not manufacturer any date-related products.
INTERNAL IT SYSTEMS: Arrhythmia Research Technology has completed its
assessment of its internal information technology systems, including business
information systems, manufacturing systems and systems providing electronic
interfaces between the ART and its customers, to determine whether the Company
operations will be interrupted by 2000 issues. This assessment involved the
testing of the Novell Server and the Real World Financial applications. Both
systems successfully passed all Year 2000 Readiness tests.
8
<PAGE>
NON-IT SYSTEMS: ART has completed the assessment the impacts of Year
2000 on non-IT systems. Non-IT systems include, but non-limited to,
telecommunications systems (PBX), security systems, HVAC systems, elevations,
utilities (Water, Gas, Electric, etc).
SUPPLY-CHAIN: Arrhythmia Research Technology has been working closely
with suppliers and other third parties upon which it is dependent, to determine
the extent of their year 2000 readiness. All critical suppliers and business
partners to ART have been contacted and assessed for of their year 2000
readiness. Although ART is very confident in the readiness of its suppliers and
business partners this assessment effort will continued through the end of the
year.
COST: Company does not expect the total cost of its Year 2000 Project
to have a material effect on the Company's business or financial results.
RISK: The Year 2000 Project is expected to significantly reduce the
Company's level of uncertainty about the Year 2000 problem and, in particular,
about the Year 2000 readiness of its external agents. Arrhythmia Research
Technology Inc. believes that, with the testing of its financial business
systems and the completion of this project, the possibility of significant
interruption of normal operations should be minimized.
The Company recognizes that failure to correct a material Year 2000
problem could result in an interruption in, or failure of certain normal
business activities or operations. Such failures could materially and adversely
affect the company's results of operations, and financial condition. Due to the
general uncertainly inherent in the Year 2000 problem, resulting in part from
the uncertainty of the Year 2000 readiness of third-party suppliers, the company
is unable to determine at this time whether the consequences of Year 2000
failures will have a material impact on the company's results of operations.
SAFE HARBOR UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995.
Forward looking statements made herein are based on current expectations of
the Company that involves a number of risks and uncertainties and should not be
considered as guarantees of future performance. These statements are made under
the Safe Harbor Provisions of the Private Securities Litigation Reform Act of
1995. The factors that could cause actual results to differ materially include:
interruptions or cancellation of existing contracts, impact of competitive
products and pricing, product demand and market acceptance risks, the presence
of competitors with greater financial resources than the Company, product
development and commercialization risks and an inability to arrange additional
debt or equity financing.
9
<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 - NONE
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 thereunto duly authorized.
Arrhythmia Research Technology, Inc.
------------------------------------
/s/ Anthony A. Cetrone,
President, Micron Products Inc.
Chairman of the Board
November 12, 1999
10
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JUL-01-1999
<PERIOD-END> SEP-30-1999
<CASH> 696
<SECURITIES> 0
<RECEIVABLES> 1,796
<ALLOWANCES> (49)
<INVENTORY> 1,177
<CURRENT-ASSETS> 3,938
<PP&E> 7,457
<DEPRECIATION> 3,525
<TOTAL-ASSETS> 10,124
<CURRENT-LIABILITIES> 1,207
<BONDS> 602
0
0
<COMMON> 37
<OTHER-SE> 8,202
<TOTAL-LIABILITY-AND-EQUITY> 10,124
<SALES> 7,974
<TOTAL-REVENUES> 0
<CGS> 1,407
<TOTAL-COSTS> 2,075
<OTHER-EXPENSES> 146
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 46
<INCOME-PRETAX> 691
<INCOME-TAX> 319
<INCOME-CONTINUING> 372
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 372
<EPS-BASIC> .11
<EPS-DILUTED> .11
</TABLE>
