UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 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
Commission file number 0-16225
EMCON
(Exact name of Registrant as specified in its charter)
California 94-1738964
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
400 South El Camino Real, Suite 1200, 94402
San Mateo, California (Zip Code)
(Address of principal executive offices
Registrant's telephone number, including area code: (415) 375-1522
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 [ ]
8,329,343 shares of Common Stock Issued and Outstanding as of October 27, 1995.
1
<PAGE>
EMCON
INDEX
REPORT ON FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBER 30, 1995
Page
Number
FACING SHEET........................................................ 1
TABLE OF CONTENTS................................................... 2
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheets
September 30, 1995 and December 31, 1994........... 3
Consolidated Statements of Income
Three months and nine months ended
September 30, 1995 and 1994........................ 4
Consolidated Statements of Cash Flows
Nine months ended September 30, 1995 and 1994...... 5
Notes to Consolidated Financial Statements........... 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations........ 8
PART II. OTHER INFORMATION......................................... 10
Signatures.......................................................... 11
Index to Exhibits................................................... 12
2
<PAGE>
<TABLE>
<CAPTION>
EMCON
CONSOLIDATED BALANCE SHEETS
- ------------------------------------------------------------------------------
September 30, December 31,
1995 1994
(In thousands, except share amounts) (Unaudited) (Audited)
- ------------------------------------------------------------------------------
ASSETS
<S> <C> <C>
Current Assets:
Cash and cash equivalents ..................... $ 6,817 $ 5,152
Marketable securities ......................... 1,002 2,436
Accounts receivable, net of allowance
for doubtful accounts of $1,335 and
$975 at September 30, 1995 and
December 31, 1994, respectively ............... 37,163 38,323
Prepaid expenses and other current assets ..... 2,159 3,253
-------- --------
Total Current Assets .......................... 47,141 49,164
Net property and equipment, at cost ........... 16,614 18,651
Intangible assets, net of amortization ........ 8,713 9,202
Other assets .................................. 5,534 3,810
-------- --------
Total Assets .................................. $78,002 $80,827
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable .............................. $ 4,960 $ 8,846
Accrued payroll and related benefits .......... 4,608 5,580
Other accrued liabilities ..................... 1,681 1,908
Non-current obligations due within one year ... 187 248
-------- --------
Total Current Liabilities ..................... 11,436 16,582
Non-current obligations ....................... 1,331 1,186
Commitments and contingencies ................. -- --
Shareholders' Equity:
Preferred stock, no par value, 5,000,000
shares authorized; no shares issued or
outstanding ................................... -- --
Common stock, no par value, 15,000,000 shares
authorized; 8,329,343 and 8,186,279 shares
issued and outstanding at September 30, 1995
and December 31, 1994, respectively ............ 41,357 40,958
Retained earnings .............................. 23,890 22,132
Unrealized losses on marketable securities ..... (12) (31)
-------- --------
Total Shareholders' Equity ..................... 65,235 63,059
Total Liabilities and Shareholders' Equity ..... $78,002 $80,827
======== ========
See accompanying notes
</TABLE>
3
<PAGE>
EMCON
CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------
Three months ended Nine months ended
September 30, September 30,
(In thousands, except per share amounts) 1995 1994 1995 1994
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Gross revenue ........................................ $32,106 $30,987 $93,591 $82,727
Outside services, at cost ............................ 5,470 4,510 14,226 12,090
-------- -------- -------- --------
Net revenue ....................................... 26,636 26,477 79,365 70,637
Costs and expenses:
Direct expenses ................................... 10,237 9,982 30,273 27,058
Indirect expenses ................................. 15,608 15,589 46,763 42,095
-------- -------- -------- --------
Income from operations ......................... 791 906 2,329 1,484
Interest income, net ................................. 71 50 166 247
Equity in loss of affiliates ......................... (3) -- (53) --
-------- -------- -------- --------
Income before provision for income taxes ............. 859 956 2,442 1,731
Provision for income taxes ........................... 209 261 684 478
-------- -------- -------- --------
Net income ........................................... $ 650 $ 695 $ 1,758 $ 1,253
======== ======== ========= ========
Income per share ..................................... $ 0.08 $ 0.09 $ 0.22 $ 0.16
======== ======== ======== ========
</TABLE>
See accompanying notes
4
<PAGE>
EMCON
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
- -------------------------------------------------------------------------------
Nine months ended
September 30,
Increase (decrease) in cash and cash equivalents -----------------
(in thousands) 1995 1994
- -------------------------------------------------------------------------------
<S> <C> <C>
Cash flow from operating activities:
Net income ........................................... $ 1,758 $ 1,253
Adjustments to reconcile net income to net cash
provided by (used for) operating activities:
Depreciation and amortization .................... 3,867 3,163
Loss on sale/disposal of property and equipment .. 149 89
Increase in salary continuation plan ............. 52 71
Changes in operating assets and liabilities:
Accounts receivable .......................... 1,160 1,219
Prepaid expenses and other current assets .... 1,094 (65)
Other assets ................................. (647) (47)
Accounts payable ............................. (3,886) (909)
Accrued payroll and related benefits ......... (972) (369)
Other accrued liabilities .................... (375) (300)
- -------------------------------------------------------------------------------
Net cash provided by operating activities ............. 2,200 4,105
- -------------------------------------------------------------------------------
Cash flow from investing activities:
Additions to property and equipment .................. (2,693) (5,371)
Purchases of available for sale securities ........... (1) (5,984)
Maturities of available for sale securities .......... 1,454 8,800
Acquisitions, net of cash acquired .................. -- 258
Proceeds from sale of property and equipment ......... 59 194
- -------------------------------------------------------------------------------
Net cash used for investing activities ............... (1,181) (2,103)
- -------------------------------------------------------------------------------
Cash flow from financing activities:
Payment of current and noncurrent obligations ........ 145 (6,715)
Issuance of common stock for cash .................... 501 698
Repurchase of common stock ........................... -- (788)
- -------------------------------------------------------------------------------
Net cash provided by (used for) financing activities . 646 (6,805)
- -------------------------------------------------------------------------------
Increase (decrease) in cash and cash equivalents ........ 1,665 (4,803)
Cash and cash equivalents, beginning of year ............ 5,152 10,578
- -------------------------------------------------------------------------------
Cash and cash equivalents, end of period ................ $ 6,817 $ 5,775
- -------------------------------------------------------------------------------
</TABLE>
See accompanying notes
5
<PAGE>
EMCON
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1. Basis of Presentation
The accompanying consolidated financial statements include the accounts of
the Company and its wholly-owned subsidiaries after elimination of all
significant intercompany accounts and transactions.
While the financial information is unaudited, the statements in this report
reflect all adjustments, which are normal and recurring, that are necessary
for a fair presentation of the results of operations for the interim
periods covered and of the financial condition of the Company at the dates
of the balance sheets. The operating results for the interim periods
presented are not necessarily indicative of performance for the entire
year.
These financial statements and notes should be read in conjunction with the
Company's consolidated financial statements for the fiscal year ended
December 31, 1994.
2. Restructuring Charges
In December 1994, as a result of changes in senior management, the Company's
Board of Directors approved a corporate restructuring plan which included
the write off of employment contracts with no current or future value,
termination of personnel, and the elimination or abandonment of excess and
underperforming assets and facilities. During the nine months ended
September 30, 1995, $556,000 of cash charges related to the restructuring
were incurred and charged against the established reserve. At September 30,
1995, $233,000 of accrued restructuring costs remained and were included in
other accrued liabilities. To-date, $948,000 of restructuring charges have
been incurred.
3. Effective April 1, 1994, the Company acquired all of the capital stock of
Wehran Envirotech, Inc. ("Wehran"), an environmental consulting company
headquartered in Middletown, New York.
6
<PAGE>
The following summarizes the unaudited pro forma net revenue, net income
(loss), and income (loss) per share for the combined company for the nine
month period ended September 30, 1995 and 1994 had the acquisition occurred
at the beginning of the periods presented.
(unaudited)
Nine months ended
September 30,
-------------------------
(in thousands) 1995 1994
---------------------------------------------------------------------------
Net revenue...................................... $79,365 $75,405
Net income....................................... 1,758 98
Income per share................................. $ 0.22 $ 0.02
---------------------------------------------------------------------------
The above proforma results of operations do not purport to reflect the
actual results of operations had the Company actually acquired Wehran as of
the beginning of the period presented.
4. Litigation
As a professional services firm engaged in environmental-related matters the
Company encounters potential liability, including claims for significant
environmental damage in the normal course of business. The Company is party
to lawsuits and is aware of potential exposure related to certain claims,
but in the opinion of management the resolution of these matters will not
have a material adverse effect on the Company's financial position, results
of operations or cash flows.
5. Income Per Share
Income per share is based on the weighted average number of common and
dilutive common - equivalent shares outstanding using the modified treasury
stock method for the three months and nine months ended September 30, 1995
and 1994.
6. Other
In 1994, the Company converted to a fifty-two/fifty-three week fiscal year
which will result in a fifty-two week year in 1995. The Company's year end
falls on the Friday closest to the last day of the calendar year. The
Company also follows a five-four-four week quarterly cycle. For convenience,
the accompanying financial statements have been shown as ending on the last
day of the calendar period.
7
<PAGE>
7. Supplemental Cash Flow Information
In the quarter ended September 30, 1995 the Company sold property in
exchange for $1,100,000 in marketable trade credits which will be used to
reduce cash payments of future reoccurring corporate expenses. The amount is
included in other assets in the accompanying balance sheet.
The sale of the property resulted in a minimal gain.
EMCON
ITEM 2. Management's Discussion and Analysis of Financial Condition and Results
Of Operations.
RESULTS OF OPERATIONS
Current Year-to-Date versus Prior Year-to-Date. Net revenue for the first nine
months of 1995 totalled $79,365,000, a 12.4% increase from the $70,637,000 for
the same period of 1994. The increase in net revenue is due in part to the
inclusion of Wehran for all of the first nine months of 1995 as compared to only
the second and third quarters of 1994 following its acquisition in April of that
year (Wehran contributed net revenue of $5,471,000 in the quarter ended March
31, 1995.) The increase in net revenue was also partly attributable to
improvement in the Company's consulting operations in the Southeast, Oregon and
California markets offset by significant underperformance of operations in the
Northeast and Midwest markets. Net revenue was also positively impacted by the
expansion of the laboratory division's operations in Florida and Southern
California.
Direct expenses totalled $30,273,000 for the first nine months of 1995, a 11.9%
increase from the $27,058,000 during the same period in 1994. Direct expenses
include compensation for billable hours for technical and professional staff and
other project related costs charged to the client. The increase in direct
expenses is primarily due to the acquisition of Wehran in April 1994 (Wehran
incurred direct expenses of $1,980,000 in the quarter ended March 31, 1995) and,
to a lesser extent, to the improved utilization of billable labor in the
consulting operations and the expansion of the laboratory division's operations
in Florida and Southern California. Direct expenses as a percentage of net
revenue remained relatively constant at 38.1% and 38.3% during the first nine
months of 1995 and 1994, respectively.
Indirect expenses for the first nine months of 1995 were $46,763,000, an 11.1%
increase over $42,095,000 for the same period in 1994. Indirect expenses include
nonbillable hours for professional and technical staff and general and
administrative expenses such as rent, bonuses, benefits, insurance, legal and
depreciation. Indirect expenses as a percent of net revenue decreased to 58.9%
from 59.6% during the first nine months of 1995 and 1994, respectively. The
improvement was principally due to improved utilization of technical and
professional staff as well as cost containment and restructuring measures put in
place during the fourth quarter of 1994.
8
<PAGE>
Income from operations for the first nine months of 1995 was $2,329,000, a 56.9%
increase compared to $1,484,000 for the same period in 1994.
The company recorded interest income, net of interest expense of $166,000 and
$247,000 for the first nine months of 1995 and 1994, respectively. The decrease
was due to a decrease in the average invested cash during the period.
Quarter Ended September 30, 1995 and 1994. For the quarter ending September 30,
1995, net revenue totalled $26,636,000, a 0.6% increase from net revenue of
$26,477,000 in the third quarter of 1994. The increase in net revenue was partly
attributable to significant improvements in the Company's consulting operations
in the Oregon and California markets offset in part by continued
underperformance of the Midwest and Northeast operations. Net revenue was also
positively impacted by the expansion of the laboratory division's operations in
Florida and Southern California.
Direct expenses for the quarter ended September 30, 1995 were $10,237,000 versus
$9,982,000 in the same quarter last year. Direct expenses as a percent of net
revenue increased to 38.4% from 37.7% for the quarters ended September 30, 1995
and 1994, respectively.
Indirect expenses for quarters ended September 30, 1995 and 1994, remained
relatively constant at $15,608,000 and $15,589,000, respectively. Due to the
increase in net revenue and improved utilization of technical and professional
staff, indirect expenses as a percent of net revenue decreased to 58.6% from
58.9% for the quarter ended September 30, 1995 and 1994, respectively.
The Company recorded interest income, net of interest expense of $71,000 for the
third quarter of 1995, compared with $50,000 in the same quarter last year.
Net income for the quarter ended September 30, 1995 was $650,000, a decrease of
6.5% compared to $695,000 for the same period in 1994.
In July 1995, the Company announced that additional cost cutting measures would
be undertaken over the balance of the year including closure of two
underperforming offices and reductions of staff in selected areas of
approximately 5%. These actions are approximately 50% complete. The Company
anticipates that although the above actions may continue to have a negative
impact on revenue and expenses in the fourth quarter, such actions are an
important step in returning the Company to a more acceptable level of
profitability in 1996 and beyond.
LIQUIDITY AND CAPITAL RESOURCES
During the first nine months of 1995, the Company financed its operations
principally from cash and marketable securities on hand, cash generated by
operations and the issuance of common stock under the Company's Employee Stock
Purchase Plan, and from the return on investment on its cash, cash equivalents
and marketable securities. Net cash provided by operations during the nine
months ended September 30, 1995 was $2,200,000. The Company, at September 30,
1995, had cash, cash equivalents, and marketable securities of $7,819,000.
9
<PAGE>
The Company invested $2,693,000 for the purchase of property and equipment in
the first nine months of 1995, primarily for computers and communication systems
and to a lesser extent, for laboratory equipment.
The Company believes that cash generated from operations and its available bank
line of $10,000,000, together with existing cash and marketable securities, will
be sufficient to meet the Company's capital needs for at least the next twelve
months.
EMCON
PART II OTHER INFORMATION
Items 1. - 4. Not applicable.
Item 5. Other Information
In July 1995, Mr. Thorley D. Briggs retired as Chairman of the Board and as a
director of the Company. At the July 28, 1995 meeting of the Board of Directors,
Mr. Douglas P. Crane was unanimously elected to serve as the new Chairman of the
Board.
Item 6. Exhibits and Reports
(a) Exhibits - See Index to Exhibits on Page 12
(b) Reports on Form 8-K - No reports on Form 8-K were filed
with the Securities and Exchange Commission during the
quarter ended September 30, 1995.
10
<PAGE>
EMCON
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.
Date: November 7, 1995 EMCON
(Registrant)
R. Michael Momboisse
---------------------------------
R. MICHAEL MOMBOISSE
Chief Financial Officer and
Vice President - Legal
(Duly authorized and principal
financial and accounting officer)
11
<PAGE>
EMCON
INDEX TO EXHIBITS
Sequentially
Exhibit Numbered
Number Page
- ------ ------------
2.1 Agreement and Plan of Reorganization dated *
effective April 1, 1994, among Wehran Envirotech,
Inc., Registrant and certain other related
parties, incorporated by reference from Exhibit
2.1 of the Current Report on Form 8-K dated May
26, 1994.
2.2 Certificate of Ownership reflecting the merger of *
Registrant's wholly-owned subsidiary, Wehran/Emcon
Northeast, Inc. into Registrant effective December
20, 1994, incorporated by reference from Exhibit
2.2 of the Registrant's Annual Report on Form 10-K
for the fiscal year ended December 31, 1994 (the
"1994 10-K").
2.3 Certificate of Ownership reflecting the merger of *
Registrant's wholly-owned subsidiary, Wehran
Engineering Corporation, into Registrant effective
December 23, 1994, incorporated by reference from
Exhibit 2.3 of the 1994 10-K.
2.4 Certificate of Ownership reflecting the merger of *
Registrant's wholly-owned subsidiary, EA
Associates, into Registrant effective December 31,
1994, incorporated by reference from Exhibit 2.4
of the 1994 10-K.
2.5 Certificate of Ownership reflecting the merger of *
Registrant's wholly-owned subsidiaries, EMCON
Northwest, Inc., EMCON Southeast, Inc., EMCON
Baker-Shiflett, Inc., and Eldredge Engineering
Associates, Inc., into Registrant effective
December 31, 1994, incorporated by reference from
Exhibit 2.5 of the 1994 10-K.
12
<PAGE>
EMCON
(Index to Exhibit Continued)
Sequentially
Exhibit Numbered
Number Page
- ------ ------------
10.1 Standard Commercial Lease dated August 1, 1985, *
between Archer Business Complex and Registrant
(the "ABC Lease"), incorporated by reference from
Exhibit 10.5 of the Registrant's Registration
Statement on Form S-1 (File No. 33-16337)
effective September 16, 1987 (the "Form S-1
Registration Statement").
10.2 Amendment to the ABC Lease between Archer Business *
Complex and Registrant dated September 30, 1992,
incorporated by reference from Exhibit 10.10 of
the Annual Report on Form 10-K for the fiscal year
ended December 31, 1992 (the "1992 10-K").
10.3 Second and Third Amendments to the ABC Lease *
between Archer Business Complex and Registrant
dated October 4, 1993 and January 1, 1994,
respectively, incorporated by reference from
Exhibit 10.2 of the Annual Report on Form 10-K for
the fiscal year ended December 31, 1993 (the "1993
10-K").
10.4 Standard Commercial Lease dated August 1, 1986, *
between the Royal Partnership and Sweet-Edwards &
Associates, Inc. (since merged into the
Registrant) incorporated by reference from Exhibit
10.9 of the Form S-1 Registration Statement.
10.5 EMCON 1986 Incentive Stock Option Plan and *(1)
Amendment, incorporated by reference from Exhibit
10.15 of the Form S-1 Registration Statement.
10.6 Form of Agreement pursuant to Salary Continuation *(1)
Plan, incorporated by reference from Exhibit 10.17
of the Form S-1 Registration Statement.
10.7 Schedule identifying Agreements pursuant to Salary *(1)
Continuation Plan between Registrant and certain
employees incorporated by reference from Exhibit
10.7 of the Registrant's Annual Report on Form
10-K for the fiscal year ended December 31, 1994
(the "1994 10-K").
13
<PAGE>
EMCON
(Index to Exhibit Continued)
Sequentially
Exhibit Numbered
Number Page
- ------ ------------
10.8 Form of Indemnity Agreement between the Registrant *
and each of the Registrant's officers and
directors, incorporated by reference from Exhibit
10.20 of the Registrant's Annual Report on Form
10-K for the fiscal year ended December 31, 1988
(the "1988 10-K").
10.9 EMCON 1988 Stock Option Plan, amended by *(1)
shareholder approval on May 25, 1994, including
form of Nonqualified Stock Option Agreement
(Outside Directors), incorporated by reference
from Exhibit 10.9 of Registrant's Quarterly Report
on Form 10-Q for the fiscal quarter ended June 30,
1994 (the "June 30, 1994 10-Q").
10.10 EMCON Employee Stock Purchase Plan amended by *(1)
shareholder approval on May 24, 1995 incorporated
by reference from Exhibit 10.10 of Registrant's
Quarterly Report on Form 10-Q for the fiscal
quarter ended June 30, 1995 (the "June 30, 1995
10-Q").
10.11 EMCON Restricted Stock Plan incorporated by *(1)
reference from Exhibit 10.15 of the Annual Report
on Form 10-K for the fiscal year ended December
31, 1990.
10.12 EMCON Deferred Compensation Plan effective January *(1)
1, 1994 incorporated by reference from Exhibit
10.12 of the 1993 10-K.
10.13 Trust Agreement for the EMCON Deferred *(1)
Compensation Plan and Salary Continuation Plan
Trust dated February 29, 1994 between Registrant
and Wells Fargo Bank, N.A. incorporated by
reference from Exhibit 10.13 of the 1993 10-K.
10.14 Credit Agreement between The Bank of California, *
N.A. and Registrant dated September 20, 1991 with
Amendment dated May 31, 1992 incorporated by
reference from Exhibits 10.11 and 10.12 of the
1992 10-K.
14
<PAGE>
EMCON
(Index to Exhibit Continued)
Sequentially
Exhibit Numbered
Number Page
- ------ ------------
10.15 Second Amendment to Credit Agreement between The *
Bank of California, N.A. and Registrant dated
effective May 31, 1992 incorporated by reference
from Exhibit 10.13 of Registrants Quarterly Report
on Form 10-Q for the quarter ended June 30, 1993.
10.16 Third Amendment to Credit Agreement between The *
Bank of California, N.A. and Registrant dated
effective June 2, 1994, incorporated by reference
from Exhibit 10.16 of the June 30, 1994 10-Q.
10.17 Fourth Amendment to Credit Agreement between the *
Bank of California, N.A. and Registrant dated
effective May 31, 1995, incorporated by reference
from Exhibit 10.17 of the June 30, 1995 10-Q.
10.18 Letter Agreement between Thorley D. Briggs and *(1)
Registrant dated September 15, 1993 incorporated
by reference from Exhibit 10.18 of Registrant's
Quarterly Report on Form 10-Q for the quarter
ended September 30, 1993 (the "September 30, 1993
10-Q").
10.19 Letter Agreement between H. Lee Fortier and *(1)
Registrant dated March 14, 1994 incorporated by
reference from Exhibit 10.21 of the Registrant's
Quarterly Report on Form 10-Q for the quarter
ended September 30, 1994.
10.20 Letter Agreement between James M. Felker and *(1)
Registrant dated December 7, 1992, incorporated by
reference from Exhibit 10.16 of the 1992 10-K.
10.21 Letter Agreement between Thorley D. Briggs and *(1)
Registrant dated July 19, 1994, incorporated by
reference from Exhibit 10.20 of the 1994 10-K.
10.22 Letter Agreement between James M. Felker and *(1)
Registrant dated October 31, 1994, incorporated by
reference from Exhibit 10.21 of the 1994 10-K.
15
<PAGE>
EMCON
(Index to Exhibit Continued)
Sequentially
Exhibit Numbered
Number Page
- ------ ------------
11.1 Computation of Income Per Share. Incorporated as 17
part of 17 this submission as document type
Ex-11.1.
27 Financial Data Schedule. Incorporated as part of 18
this 18 submission as document type EX-27.
- ------------
* Incorporated by reference
(1) Management contract or compensatory plan or arrangement required to be
filed as an exhibit to this form pursuant to Item 14(c) of the
instructions to Form 10-K.
16
<PAGE>
EXHIBIT 11.1
EMCON
COMPUTATION OF INCOME PER SHARE
(In thousands except per share data)
<TABLE>
<CAPTION>
Three months ended Nine months ended
September 30, September 30,
1995 1994 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>
Net income ............................. $ 650 $ 695 $1,758 $1,253
Proforma interest income related
to modified treasury stock method ... 59 49 194 99
------- ------ ------ ------
Adjusted net income .................... $ 709 $ 744 $1,952 $1,352
======= ====== ====== ======
Weighted average number of common shares
outstanding during the period .......... 8,296 8,153 8,255 7,856
Common equivalent share from
outstanding stock options using the
modified treasury stock method ...... 657 573 660 462
Incremental shares to reflect full
dilution (1) ........................ 0 0 0 0
------ ------ ------ ------
Total shares for purposes of calculating
diluted income per share (1) ........... 8,953 8,726 8,915 8,318
====== ====== ====== ======
Primary income per share ............... $ 0.08 $ 0.09 $ 0.22 $ 0.16
====== ====== ====== ======
Fully diluted income per share ......... $ 0.08 $ 0.09 $ 0.22 $ 0.16
====== ====== ====== ======
</TABLE>
- -----------------------
(1) This calculation is submitted in accordance with Regulation S-K Item
601(b)(11) although not required by footnote 2 to paragraph 14 to APB
opinion No. 15, because it results in dilution of less than 3%.
17
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
consolidated balance sheets, consolidated statements of income and consolidated
statements of cash flows included in the Company's Form 10-Q for the nine month
period ended September 30, 1995, and is qualified in its entirety by reference
to such financial statements and the notes thereto.
</LEGEND>
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-1-1995
<PERIOD-END> SEP-30-1995
<EXCHANGE-RATE> 1
<CASH> 6,817,000
<SECURITIES> 1,002,000
<RECEIVABLES> 38,498,000
<ALLOWANCES> 1,335,000
<INVENTORY> 0
<CURRENT-ASSETS> 47,141,000
<PP&E> 37,633,000
<DEPRECIATION> 21,019,000
<TOTAL-ASSETS> 78,002,000
<CURRENT-LIABILITIES> 11,436,000
<BONDS> 0
<COMMON> 41,357,000
0
0
<OTHER-SE> (12,000)
<TOTAL-LIABILITY-AND-EQUITY> 78,002,000
<SALES> 79,365,000
<TOTAL-REVENUES> 79,365,000
<CGS> 30,273,000
<TOTAL-COSTS> 30,273,000
<OTHER-EXPENSES> 46,081,000
<LOSS-PROVISION> 527,000
<INTEREST-EXPENSE> 42,000
<INCOME-PRETAX> 2,442,000
<INCOME-TAX> 684,000
<INCOME-CONTINUING> 1,758,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,758,000
<EPS-PRIMARY> .22
<EPS-DILUTED> .22
