UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period ended December 31, 1999
Commission File Number 0-17304
CNH HOLDINGS COMPANY
(FORMERLY CORAL COMPANIES INC.)
(Exact name of registrant as specified in charter)
Nevada
11-2867201
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
7457 Harwin Drive, Suite 304 Houston, Texas
77036
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (713) 780-3178
--------------
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during the past 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 -
State the number of shares outstanding of each of the issuer's classes of common
equity, as of the latest practicable date: As of December 31, 1999, the Company
had outstanding 7,811,774 shares of its common stock, par value $0.001.
<PAGE>
ITEM 1. FINANCIAL STATEMENTS
CNH HOLDINGS COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
Unaudited Audited
December 31, March 31,
1999 1999
ASSETS ---- ----
<S> <C> <C>
Current Assets:
Cash on deposit $ 292,426 $ 9,309
Cash (restricted) -- 19,794
----------- -----------
Total cash 292,426 29,103
----------- -----------
Receivables:
Trade 135,788 80,736
Stock subscription 3,500 535
receivable
Employee advances 400 --
Note receivable -- 34,500
----------- -----------
139,688 115,771
Less allowance for doubtful accounts 11,763 59,673
----------- -----------
Total Receivables 127,925 56,098
----------- -----------
Total current assets 420,351 85,201
----------- -----------
Property, Plant and Equipment
Land 70,000 70,000
Oil and gas leasehold costs 199,697 154,937
Other equipment 297,056 372,019
----------- -----------
Less accumulated depreciation
and depletion 84,450 54,350
----------- -----------
Net property, plant and equipment 482,303 542,606
----------- -----------
Other assets:
Organization costs,
net of accumulated amortization 2,870 1,517
Deposits 3,445 3,650
----------- -----------
Total Other Assets $ 6,315 $ 5,167
Total Assets $ 908,969 $ 632,974
========== =========
</TABLE>
<PAGE>
CNH HOLDINGS COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(Continued)
<TABLE>
Unaudited Audited
December 31, March 31,
1999 1999
LIABILITIES AND STOCKHOLDERS' EQUITY ---- ----
<S> <C> <C>
Current liabilities:
Accounts payable $ 557,231 $ 296,149
Other payables 18,750 15,815
Accrued expenses 825 20,826
Notes-Banks 323,954 237,576
Note to Texas Capital Advisors 250,000 --
Note-other 10,000 10,000
Note-shareholder 20,000 118,600
Current portion
Long-term debt 48,500 42,000
----------- -----------
Total current liabilities 1,229,260 740,966
----------- -----------
Long term debt:
Notes payable, bank 60,732 105,076
Note payable-other 8,624 --
Less current portion 48,500 42,000
----------- -----------
Total long term debt
20,856 63,076
----------- -----------
Stockholders' Equity (Deficit)
Preferred Stock, $.01 par value,
1,000,000 authorized,
200,000 issued and outstanding 2,000 2,000
Common Stock, $.001 par value,
10,000,000 authorized,
7,811,774 issued and outstanding 7,812 7,259
Additional paid-in capital 1,133,307 581,495
Deficit (1,484,265) (761,822)
----------- -----------
Total Liabilities and
Stockholders' Equity $ 908,969 $ 632,974
=========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
<PAGE>
CNH HOLDINGS COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
Unaudited
Three Months Ended
December 31, December 31,
1999 1998
---- ----
<S> <C> <C>
REVENUES:
Oil and gas revenues $ 95,613 $ 62,022
Overhead income 18,993 24,726
Service income -- 112,716
Equipment rental income 12,000 13,674
Other 1,634 --
----------- -----------
Total Revenues 128,240 213,138
------------ -----------
COSTS AND EXPENSES:
Direct Costs 195,512 246,328
Depreciation, depletion
and amortization 16,509 9,591
Selling, general and administrative 77,129 95,785
Total operating costs 289,150 351,704
----------- ----------
Net loss from operations (160,910) (138,566)
OTHER INCOME (EXPENSES):
Interest income 11 77
Sale of assets (18,201) --
Interest expense (15,607) (13,991)
----------- ----------
Total other income
(Expenses) (33,797) (13,914)
----------- ----------
Net income (loss) $ (194,707) $ (152,480)
=========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements
<PAGE>
CNH HOLDINGS COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
Unaudited
Nine Months Ended
December 31, December 31,
1999 1998
---- ----
<S> <C> <C>
REVENUES:
Oil and gas revenues $ 256,995 $ 83,870
Overhead income 54,671 32,527
Service income 522,669 330,281
Equipment rental income 20,000 17,660
Other 2,638 11,265
----------- -----------
Total Revenues 856,973 475,603
------------ -----------
COSTS AND EXPENSES:
Direct Costs 1,141,836 488,681
Depreciation, depletion and
amortization 52,136 20,038
Selling, general and
administrative 377,292 214,483
Total operating costs 1,571,264 723,202
----------- -----------
Net loss from operations (714,291) (247,599)
OTHER INCOME (EXPENSES):
Interest income 290 244
Sale of assets 26,407 --
Interest expense (34,850) (33,397)
----------- ----------
Total other income
(Expenses) ( 8,153) (33,153)
----------- ----------
Net income (loss)
$ (722,444) $ (280,752)
=========== ==========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements
<PAGE>
CNH HOLDINGS COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
Unaudited
Nine Months Ended
December 31, December 31,
1999 1998
---- ----
<S> <C> <C>
OPERATING ACTIVITIES:
Net (loss) $ (722,444) $ (280,752)
Adjustments to reconcile
net income (loss) to net
cash provided by operating
activities:
Depreciation, depletion
and amortization 52,136 20,037
Gain on sale of assets (26,407)
(Increase)Decrease in accounts
receivable-trade, net (68,489) (88,060)
(Increase)Decrease in stock
subscriptions receivable (3,250) 83,250
(Increase) decrease in employee
advances (115) (102,519)
(Increase) decrease in notes
receivable 28 (34,500)
Increase (decrease) in accounts
payable 256,213 308,496
Increase (decrease) in other
payables 3,250 --
Increase (decrease) in accrued
expenses (15,446) 6,937
Increase (decrease) in notes
payable - banks (237,356) --
Increase (decrease) in notes
payable - other (10,000) --
Increase (decrease) in notes
payable - shareholders (108,600) 58,600
Increase (decrease) in current
portion long-term debt (42,220) --
----------- -----------
Net cash provided(used) by
operating activities (922,700) (28,511)
----------- -----------
INVESTING ACTIVITIES:
Proceeds from sale of assets 110,186 --
Purchase of oil and gas properties (53,129) (144,146)
Net increase of other equipment (23,837) (40,198)
(Increase) decrease in utility
deposits 205 (3,650)
Purchase of land (70,000)
Increase in organizational costs (1,767)
Purchase of net book value of
other equipment due to
acquisition (214,720)
---------- ------------
NET CASH PROVIDED (USED) IN
INVESTING ACTIVITIES 33,425 (474,481)
---------- ------------
FINANCING ACTIVITIES
Proceeds from other long
term borrowings 583,639 163,733
Reduction of long term debt (233,405) (12,776)
Proceeds from Texas Capital
Advisors 250,000 --
Proceeds from sale of common
stock 552,364 294,155
Proceeds from mortgage note
payable 70,000
Proceeds from sale of preferred
stock 2,000
--------- ------------
NET CASH PROVIDED BY FINANCING
ACTIVITIES 1,152,598 517,112
INCREASE IN CASH 263,323 14,120
Cash at beginning of period 29,103 --
--------- ---------
CASH AT END OF PERIOD $ 292,426 $ 14,120
========= =========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements
<PAGE>
CNH HOLDINGS COMPANY AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
December 31, 1999
(Unaudited)
1. GENERAL
The accompanying unaudited consolidated financial statements have been prepared
in conformity with the accounting principles stated in the audited financial
statements for the year ended March 31, 1999 and reflect all adjustments which
are, in the opinion of management, necessary for a fair statement of the
financial position as of December 31, 1999 and the results of operations for the
periods presented. These statements have not been audited or reviewed by the
Company's independent certified public accountants. The operating results for
the interim periods are not necessarily indicative of results for the full
fiscal year.
The notes to consolidated financial statements appearing in the Company's Annual
Report on form 10-KSB for the year ended March 31, 1999 and the notes to the
quarterly 10-QSB for the periods ended June 30,1999 and September 30,1999 as
filed with the Securities Exchange Commission should be read in conjunction with
this Quarterly Report on Form 10-QSB. There have been no significant changes in
the information in those notes other than from normal business activities of the
Company.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS
OR PLAN OF OPERATION
The financial information set forth in the following discussion should be read
in conjunction with, and qualified in its entirety by, the financial statements
of the Company included elsewhere herein
Introduction: The following discussion has been prepared assuming the Company
will continue as a going concern; however, the audit report for the financial
statements as of and for the periods ended March 31, 1999, includes a caveat on
this point. In reading the following, one should first consult the audit report,
financial statements and footnotes, while keeping in mind the significant
operating losses generated by the Company on a consolidated basis with its
subsidiaries.
BUSINESS
Business developments occurring during the quarter ended December 31, 1999:
CNH Holdings Company, Inc. (the "Company") organized a new 100% wholly-owned
subsidiary named Telenergy Communications, Inc. ("Telenergy").
Telenergy designs, supplies, and services advanced communications solutions for
application in the global energy and energy services industries. Telenergy's
customized solutions incorporate various existing communication technologies and
platforms and are designed to keep its customers on the forefront of
"connectivity."
Telenergy's mission is to be the leader in the specialized energy communications
market and to create a sustainable competitive advantage over its rivals. Market
leadership and sustainable advantage are achieved through Telenergy's commitment
to continually add the most value for its customers by designing, supplying, and
servicing superior quality communications solutions at the lowest deliverable
costs.
Telenergy has developed a mobile voice and data communications solution using a
Hughes Network Systems ("HNS"), a unit of Hughes Electronics Company,
satellite-based private network that will make oil and gas exploration more
efficient and less costly. Incorporating HNS' very small aperture terminals
(VSATs), the Telenergy "PES-8000(TM)" provides voice, fax, and data
communications between company data centers or headquarters and remote drilling
sites.
<PAGE>
Management anticipates that the PES-8000 can reduce costs significantly by using
satellite technology to bypass terrestrial communications links to remote oil
and gas facilities. For no additional charges, remote facilities are enabled for
fax transmissions and even more importantly, the data networking that is
critical in their exploration, production, and development process. With secured
PES-8000 data networks in place, each remote facility becomes an independent
node within a specialized network. Drilling and geologic data can be transmitted
to corporate headquarters instantaneously, enabling engineers to more quickly
make quality decisions based on raw unfiltered data from the field.
The PES-8000 allows operators to control resources and maximize efficiency
during the drilling phase of operations. Direct voice, fax, and data
communications allow drilling sites to access the resources located at company
headquarters facilities, which translates into more efficient and informed
decisions at the well head. Additional benefits include incorporating remote
sites into the company's wide area network and allowing remotely located
employees e-mail and Internet access.
Telenergy and HNS have agreed to a five-year contract, under which HNS will
supply its Personal Earth Station(TM) (PES) VSAT product and services for
integration with Telenergy's PES-8000 system. A self-contained unit that
requires minimal setup and installation, the PES-8000 is leased to Telenergy's
domestic and international customers.
Although the Company anticipates substantial revenues to be generated from this
new subsidiary there can be no assurance that such sales will occur.
On December 15, 1999, the Company entered into an agreement with Rancho Santa Fe
Capital Partners to assist CNH in raising capital for its new telecommunications
company. Management is seeking up to $5,000,000 of new capital to be funded
within a 6 month period. These funds are intended to expand the presence of
Telenergy in the marketplace. There can be no assurances given that this funding
will occur.
On December 24, 1999, the Company secured a $500,000 bridge loan from Texas
Capital Advisors, Inc. The purpose of the loan is to provide working capital for
the Company and its subsidiaries. The loan is to be funded in 2 equal payments
of $250,000 with the first payment being received at the end of December 1999.
The basic terms of the loan agreement call for 15% interest per annum with the
lump sum repayment of the loan and accrued interest on or before June 30, 2000.
The loan is secured by a lien on any and all assets of the Company and its
subsidiaries. Additional security is a stock pledge of 4,000,000 shares of the
Company's common stock. Upon repayment of the entire loan and accrued interest,
Texas Capital Advisors will return 1,000,000 of the common shares to the
Company. The 4,000,000 shares of common stock represent approximately 43.5% of
the Company's outstanding shares and have full voting power which represents a
substantial change in control of the Company. The Company filed a Form SC 13D
with the Securities and Exchange Commission in regards to this transaction and a
more detail description of this transaction may be found by contacting the
Commission. Management anticipates repaying the entire loan and interest when
and if funding is received under the previously mentioned Rancho Santa Fe
Capital agreement. The Company anticipates taking a substantial non-cash charge
to earnings during the fourth quarter to reflect this issuance of this stock.
The amount is not known at this time and again is non-cash in nature.
Business developments occurring subsequent to the quarter ended December 31,
1999:
In January 2000, the Company purchased Bolton Energy Services, Inc. for $100,000
in cash and 300,000 shares of the Company's common stock. The cash portion is
payable in three payments over the next 12 months. Bolton Energy Services, Inc.
is an oilfield down hole tool rental company with exclusive agencies for the
Teledrift line of deviation tool products in east Texas, west Texas, New Mexico,
the Gulf of Mexico, and Africa (excluding Egypt). Management anticipates that
Bolton Energy will generate significant revenues and profits in future periods.
There can be no assurances that such revenues and profits will occur.
On January 13, 2000, the Company sold its oil production subsidiary, Southport
Environmental & Development, Inc. to Larry V. Tate and Gerald W. Pybas. As
consideration for their purchase, Messrs. Tate and Pybas are returning
approximately 3,000,000 shares of CNH common stock and 184,000 shares of CNH
convertible preferred stock to CNH's treasury.
The sale of Southport is part of a reorganization plan with which the Company
intends to focus its efforts and resources on growth opportunities and projects
at its other subsidiaries. Telenergy Communications, Inc., a wholly-owned
subsidiary of CNH, provides satellite communications and related services to
customers in the energy industry. The NORM Services Group, Inc., another
wholly-owned subsidiary of CNH, is an environmental company involved in the
cleanup and remediation of non-hazardous oil field wastes. Bolton Energy
Services, Inc., also a wholly-owned subsidiary of CNH, is an oilfield tool
rental company.
As part of the reorganization plan, Mr. Tate has resigned his position as Chief
Executive Officer of CNH and Mr. Pybas has resigned as President. On January 15,
2000, Robert A. Baker, former President of Texas United Chemical Company, was
appointed Chief Executive Officer and President of CNH and President of CNH's
wholly-owned subsidiary, The NORM Services Group, Inc.
In conjunction with the employment of Mr. Baker, the Company began relocating
its corporate offices to Houston, Texas in January 2000. The Company is leasing
approximately 400 square feet on a month-to-month basis from Texas Capital
Advisors (the company that provided the aforementioned bridge loan). Management
anticipates that this move will be completed prior to March 19, 2000.
<PAGE>
FINANCIAL CONDITION AND CHANGES IN FINANCIAL CONDITION
The following analysis of historical financial condition and results of
operations are not necessarily reflective of the on-going operations of the
Company due to the substantial amount of changes that have occurred which were
discussed in the previous caption.
At December 31, 1999, total current assets increased $335 thousand since March
31, 1999 (the Company's fiscal year end). The primary increase was in trade
receivables and the $250 thousand of bridge loan funds received at the end of
December 1999. All previously factored receivables have been repaid. There were
not any substantial changes in any of the other assets of the Company. These
assets include only $250,000 of the funding of the aforementioned $500,000
bridge loan. Total assets increased 44% for the nine months ended December 31,
1999.
Total liabilities increased $446 thousand or 56% for the nine months ended
December 31, 1999 primarily as a result of increased borrowings and increased
accounts payable in order to fund the operations pending the funding of the
anticipated raising of additional capital. There are no assurances that such
funding will occur.
The primary activity affecting the financial condition of the Company during the
quarter was the decline in activity with the NORM Services Group. In part this
was due to the reduction of personnel in the quarter and the complete
involvement of other personnel in the completion of a single large project. As a
consequence no new work was undertaken in this entity.
The on-going operations of the Company, and the NORM Services Group in
particular, have been substantially impacted by the large cost overruns by the
NORM Services Group over the past year and a half of operations. While there has
been no defaults on bank notes, virtually all of the NORM Services Group, Inc.
trade payables are seriously past due as of December 31, 1999. As part of the
restructuring occurring within the Company, Management is currently evaluating
the operations of the NORM Services Group and its ability to continue
operations.
Overall Operating Results
Three months ended December 31, 1999 compared to three months ended December 31,
1998:
Net loss for the 3 months ended December 31, 1999 was $(160) thousand as
compared to a loss of $(139) for the comparable previous year quarter. The
primary source of revenue has been oil and gas revenues which increased to $96
thousand for the current quarter as compared to $62 thousand for the prior year.
The primary difference in revenue was the lack of any service income during the
current quarter. The reason for no service revenue was that The NORM Services
Group had no billable activity during the quarter. Prior year quarter service
revenue was $113 thousand. Direct operating cost decreased $51 thousand as a
result of the lack of activity in The NORM Services Group during the current
quarter. Total expenses (including direct cost, depreciation, amortization and
depletion and operating expenses) decreased 18% during the current quarter. The
newly formed Telenergy did not generate any revenue during the quarter and had
$14 thousand in expenses. Management anticipates that this entity and the
purchase of Bolton Energy Services will generate substantial revenues in future
periods. There can be no assurances that these anticipated revenues will arise.
Nine months ended December 31, 1999 compared to nine months ended December 31,
1998:
Net loss for the current year nine-month period was $(714) thousand as compared
to $(248) thousand for the prior year. Total revenues increased $381 thousand to
$857 thousand or a 80% increase over the comparable period for 1998. The primary
increases were in oil and gas and service revenues. Management anticipates that
these revenues will decrease in the future due to the sale of Southport
Environmental & Development, Inc. Future revenue prospects include the expansion
of the Telenergy and Bolton subsidiaries. Even though revenues showed strong
increases for the current year to date the associated costs and expenses
increased at even a faster rate. Total cost and expenses increased 117% to $1.6
million over the prior year. Please refer to the "BUSINESS" section above for a
discussion of the restructuring and financing that has occurred subsequent to
December 31, 1999.
LIQUIDITY AND CAPITAL RESOURCES
The Company secured a $500 thousand bridge loan (of which $250 thousand was
funded prior to December 31,1999) at the end of the quarter in order to fund
future operations and is seeking up to $5 million in new capital. The Company
has sustained substantial losses since its inception and as such received a
going concern qualification in its audit report as of March 31, 1999. There can
be no assurance that to sustain the continued growth of the Company will not
require additional debt or equity offerings at some point in the future.
<PAGE>
NEW ACCOUNTING PRONOUNCEMENTS
The Company has adopted FASB Statement 128. It is not expected that the Company
will be impacted by other recently issued standards. FASB Statement 128 presents
new standards for computing and presenting earnings per share (EPS). The
Statement is effective for financial statements for both interim and annual
periods ending after December 15, 1997.
FASB Statement 131 presents news standards for disclosures about segment
reporting. The Company does not believe that this accounting standard applies to
the Company as all operations of the Company are integrated for financial
reporting and decision-making purposes.
YEAR 2000 PREPAREDNESS
The Company recognizes that computer systems and all forms of electronic
technologies, information technologies and non-information technologies, could
be adversely affected by the year 2000 date. This is because many systems and
technology components use a two-digit field to represent the year in dates
(e.g., "98" rather than "1998"). With the advent of year 2000, systems and
programs may fail or produce incorrect data believing it is the year 1900,
causing not just information technology problems but also business and
operations problems.
The Company continues to evaluate its information technology infrastructure for
Year 2000 compliance. The Company currently does not expect that the cost of its
Year 2000 compliance program will be material to its financial condition or
results of operations or that its business will be adversely affected by the
Year 2000 issue in any material respect. Nevertheless, achieving Year 2000
compliance is dependent on many factors, some of which are not completely within
the Company's control. Should either the Company's internal systems or the
internal systems of one or more significant vendors or suppliers fail to achieve
Year 2000 compliance, the Company's business and its results of operations could
be adversely affected.
The Company has not been materially affected with Y2K problems since December
31, 1999 to the date of this filing.
INFLATION
The Company's results of operations have not been affected by inflation and
management does not expect inflation to have a significant effect on its
operations in the future.
FORWARD-LOOKING INFORMATION
From time to time, the Company or its representatives have made or may make
forward-looking statements, orally or in writing. Such forward-looking
statements may be included in, but not limited to, press releases, oral
statements made with the approval of an authorized executive officer or in
various filings made by the Company with the Securities and Exchange Commission.
Words or phrases "will likely result", "are expected to", "will continue", "is
anticipated", "estimate", "project or projected", or similar expressions are
intended to identify "forward-looking statements" within the meaning of the
Private Securities Litigation Reform Act of 1995 (the "Reform Act"). The Company
wishes to ensure that such statements are accompanied by meaningful cautionary
statements, so as to maximize to the fullest extent possible the protections of
the safe harbor established in the Reform Act. Accordingly, such statements are
qualified in their entirety by reference to and are accompanied by the following
discussion of certain important factors that could cause actual results to
differ materially from such forward-looking statements.
Management is currently unaware of any trends or conditions other than those
previously mentioned in this management's discussion and analysis that could
have a material adverse effect on the Company's consolidated financial position,
future results of operations, or liquidity. However, investors should also be
aware of factors that could have a negative impact on the Company's prospects
and the consistency of progress in the areas of revenue generation, liquidity,
and generation of capital resources. These include: (i) variations in the price
of energy, (ii) possible inability to attract investors for its equity
securities or otherwise raise adequate funds from any source should the Company
seek to do so, (iii) increased governmental regulation, (iv) increased
competition, (v) unfavorable outcomes to litigation involving the Company or to
which the Company may become a party in the future and, (vi) a very competitive
and rapidly changing operating environment. Furthermore, reference is also made
to other sections of this report that include factors that could adversely
impact the Company's business and financial performance.
The risks identified here are not all inclusive. New risk factors emerge from
time to time and it is not possible for Management to predict all of such risk
factors, nor can it assess the impact of all such risk factors on the Company's
business or the extent to which any factor or combination of factors may cause
actual results to differ materially from those contained in any forward-looking
statements. Accordingly, forward-looking statements should not be relied upon as
a prediction of actual results.
<PAGE>
PART II OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
b. Reports on Form 8-K
None
<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.
(Registrant) CNH Holdings Company
By Robert A. Baker
Chief Executive Officer and President
Date February 21, 2000
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.
By Helen Wallace
Chief Financial and Accounting Officer and Treasurer
Date February 21, 2000
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-2000
<CASH> 292,426
<SECURITIES> 0
<RECEIVABLES> 139,688
<ALLOWANCES> 11,763
<INVENTORY> 0
<CURRENT-ASSETS> 420,351
<PP&E> 566,653
<DEPRECIATION> 84,450
<TOTAL-ASSETS> 908,969
<CURRENT-LIABILITIES> 1,229,260
<BONDS> 0
0
2,000
<COMMON> 7,812
<OTHER-SE> (350,958)
<TOTAL-LIABILITY-AND-EQUITY> 908,969
<SALES> 856,973
<TOTAL-REVENUES> 856,973
<CGS> 1,141,836
<TOTAL-COSTS> 1,141,836
<OTHER-EXPENSES> 429,428
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 34,850
<INCOME-PRETAX> (722,444)
<INCOME-TAX> 0
<INCOME-CONTINUING> (722,444)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (722,444)
<EPS-BASIC> (.09)
<EPS-DILUTED> (.09)
</TABLE>
