UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB/A
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended June 30, 1999 Commission File No. 00019678
INFRACORPS, INC.
(Exact name of registrant as specified in its charter)
Virginia 54-1414643
State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
7400 Beaufont Springs Drive, Suite 415, Richmond, VA 23225
(Address) (Zip Code)
Registrant's telephone number, including area code (804) 272-6600
(Former name, former address and former fiscal year
if changed since last report)
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 and (2) has been subject to the filing
requirements for the past 90 days.
Yes x No
Indicate the number of shares outstanding of each of the issuer's classes of
stock, as of the close of the period covered by this report.
Class Number of Shares Outstanding
Common Stock 16,395,487
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
INFRACORPS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
June 30, 1999 March 31, 1999
------------- --------------
<S> <C>
ASSETS (unaudited) (audited)
Current assets:
Cash and cash equivalents $ 198,248 $ 272,259
Accounts receivable:
Trade (net of allowance of $50,000 at June 30, 1999 and
March 31, 1999) 3,445,550 3,389,342
Other 0 12,917
Costs and estimated earnings in excess of billings
on uncompleted contracts 838,858 868,061
Notes Receivable - Current 23,085 23,085
Inventory 635,812 599,451
Prepaid expenses 56,793 47,612
----------- -----------
Total current assets 5,198,346 5,212,727
Property, plant and equipment:
Furniture and fixtures 369,236 364,236
Machinery, tools and equipment 4,150,809 3,766,096
Vehicles 1,830,408 1,567,493
Leasehold improvements 301,370 301,370
------------ ------------
6,651,823 5,999,195
Less accumulated depreciation 3,936,508 3,829,184
----------- -----------
Total property, plant and equipment, net 2,715,315 2,170,011
Other assets:
Restricted Cash 600,000 600,000
Notes receivable 327,717 321,454
Cash value of life insurance 22,879 22,879
Assets under contractual arrangements (net of
valuation allowance of $858,000) 190,740 190,740
Other assets 56,694 52,636
----------- -----------
Total other assets 1,198,030 1,187,709
--------- ---------
Total assets $ 9,111,691 $ 8,570,447
========== ===========
</TABLE>
<PAGE>
LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
June 30, 1999 March 31, 1999
------------- --------------
(unaudited) (audited)
<S> <C>
Current liabilities:
Bank overdraft $ 16,799 $ 241,931
Notes payable to bank 950,000 -
Notes payable to affiliates 607,400 609,900
Current portion of long-term debt 364,248 364,248
Accounts payable 3,145,159 3,574,837
Accrued expenses and other current liabilities 304,134 382,229
----------- -----------
Total current liabilities 5,387,740 5,173,145
Long-term liabilities:
Long-term debt 895,297 682,046
Liabilities of business transferred under contractual
arrangements 140,339 140,339
------------- ------------
Total liabilities 6,423,376 5,995,530
Stockholders' equity:
Preferred stock, no par value, authorized 5,000,000 shares: 4% cumulative
Series A, $1 convertible, 1,850,000 shares outstanding at June 30, 1999
and 1,750,000 shares outstanding at March 31, 1999 (liquidation value of
$1,850,000 and $1,750,000 respectively) 848,714 730,311
8% Series B, 10,421 shares outstanding at June 30, 1999 and
March 31, 1999 (liquidation value of $1,042,100) 1,042,100 1,042,100
Common stock, no par value; authorized 30,000,000
shares; issued and outstanding 16,395,487 and 16,492,043
at June 30, 1999 and March 31, 1999, respectively 5,933,226 6,126,338
Retained earnings (accumulated deficit) (5,135,723) (5,130,720)
Less notes receivable from officers 0 (193,112)
------------- -------------
Total stockholders' equity 2,688,317 2,574,917
------------ ------------
Total liabilities and stockholders' equity $ 9,111,693 $ 8,570,447
============ ===========
</TABLE>
<PAGE>
INFRACORPS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
<TABLE>
<CAPTION>
Three months ended
------------------
June 30, 1999 June 30, 1998
------------- -------------
(unaudited) (unaudited)
<S> <C>
Contract Revenues - Commercial $ 4,934,009 $ 3,910,161
Cost of goods and services 4,270,668 3,229,344
----------- -----------
Gross Profits (losses) 663,341 680,817
Selling, general and administrative expenses 583,850 649,060
---------- ------------
79,491 31,757
Interest income 10,152 11,042
Interest expense (56,095) (135,881)
Gain on sale of equipment 695 329,478
----------- ------------
Income (Loss) from continuing operations $ 34,243 $ 236,396
Gain/(loss) from discontinued operations 0 (210,043)
----------- ------------
Net income (loss) $ 34,243 $ 26,353
========== ============
Earnings (Loss) from continuing operations per common share:
Basic $ .00 $ .00
Diluted $ .00 $ .00
Earnings (Loss) per common share:
Basic $ .00 $ .00
Diluted $ .00 $ .00
Average shares of common stock used for above computation:
Basic 16,492,043 16,492,043
Diluted 18,309,043 16,492,043
</TABLE>
<PAGE>
INFRACORPS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY (DEFICIT)
<TABLE>
<CAPTION>
Preferred Stock Preferred Stock
Series A Series B Common Stock
---------------------------------------------------------------------------- Accumulated
Shares Amount Shares Amount Shares Amount Deficit
-------------------------------------------------------------------------------------------
<S> <C>
Balances at March 31, 1999 1,750,000 $ 730,311 10,421 $1,042,100 16,492,043 $ 6,126,338 $ (5,130,720)
Net income 34,243
Dividends Series A 18,403 (18,403)
Dividends Series B (20,841)
Issuance of preferred shares 100,000 100,000
Repayment of debt (96,556) (193,112)
---------------------------------------------------------------------------------------------
Balances at June 30, 1999 1,850,000 $ 848,714 10,421 $1,042,100 16,395,487 $ 5,933,226 $ (5,135,723)
=============================================================================================
</TABLE>
<TABLE>
<CAPTION>
Notes
Receivable
from
Officers Total
-------------------------------
<S> <C>
Balances at March 31, 1999 $ (193,112) $ 2,574,917
Net income 34,243
Dividends Series A 0
Dividends Series B (20,841)
Issuance of preferred shares 100,000
Repayment of debt 193,112 0
------------------------------
Balances at June 30, 1999 $ 0 $ 2,688,317
==============================
</TABLE>
<PAGE>
INFRACORPS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOW
<TABLE>
<CAPTION>
Three months ended
------------------
June 30, 1999 June 30, 1998
------------- -------------
<S> <C>
(unaudited) (unaudited)
Cash flows from operating activities:
Net income (loss) $ 34,243 $ 26,352
Adjustments to reconcile net income (loss) to net cash used in operating
activities:
Depreciation and amortization 107,324 138,705
Amortization of deferred gain on sale/leaseback 0 (76,077)
Loss/(gain) on sale of fixed assets (695) (329,478)
Increase/decrease in operating assets and liabilities:
Accounts receivable (43,291) (185,269)
Costs and estimated earnings in excess of billings on
uncompleted contracts 29,203 28,919
Inventories (36,361) 79,111
Prepaid expenses (9,181) 27,546
Accounts payable (429,678) 304,918
Accrued expenses and other liabilities (78,095) (146,619)
Other Assets (4,058) 83,937
------------ -------------
Net cash used in operating activities (430,589) (47,955)
Cash flow from investing activities:
Purchase of property, plant and equipment (652,628) (165,216)
Proceeds from sale of equipment 0 350,000
Notes receivable decrease (increase) (6,263) 200,000
Decrease in assets under contractual arrangements 0 23,067
----------- --------------
Net cash used in investing activities (658,891) 407,851
</TABLE>
(continued)
<PAGE>
<TABLE>
<CAPTION>
Three months ended
------------------
June 30, 1999 June 30, 1998
------------- -------------
(unaudited) (unaudited)
<S> <C>
Cash flows from financing activities:
Bank overdraft (225,135) (173,493)
Principal payments on long-term debt (73,558) (175,088)
Notes payable to affiliates decrease (2,500) (143,661)
Proceeds from line of credit 950,000 0
Proceeds from note payable 287,500 0
Dividend paid (20,841) 0
Proceeds from sale of preferred shares 100,000 0
Proceeds from notes payable to stockholder 0 150,000
---------------- ---------
Net cash provided by financing activities 1,015,469 (342,242)
--------------- --------------
Increase (decrease) in cash and cash equivalents (74,011) 17,654
Cash and cash equivalents at beginning of year 272,259 206,750
--------------- ------------
Cash and cash equivalents at end of period $ 198,248 $ 224,404
============== ==============
</TABLE>
Supplemental disclosures of cash flow information and noncash investing
activities: Interest paid on notes payable and long-term debt was $56,095 and
$54,347 for the three months ended June 30, 1999 and June 30, 1998 respectively.
<PAGE>
INFRACORPS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE A--BASIS OF PRESENTATION
The accompanying unaudited financial statements 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 necessary
adjustments (consisting of normal recurring accruals) considered necessary for a
fair presentation have been included. Operating results for the three months
ended June 30, 1999 are not necessarily indicative of the results that may be
expected for the fiscal year ending March 31, 2000.
NOTE B--PRINCIPLES OF CONSOLIDATION
The consolidated financial statements include the accounts of INFRACORPS, Inc.
and its wholly-owned subsidiaries, IC Subsidiary, Inc. (formerly ETS, Inc.), ETS
Analytical Services, Inc., InfraCorps of Virginia, Inc. (formerly ETS Water And
Waste Management, Inc.) and its subsidiary InfraCorps of Florida, Inc. (formerly
ETS Liner, Inc.), InfraCorps Technology, Inc. and InfraCorps International, Inc.
Significant intercompany accounts and transactions have been eliminated in
consolidation.
NOTE C--EARNINGS PER SHARE
Earnings per share have been computed on the basis of the weighted average
number of shares outstanding, after giving appropriate effect for common stock
issued. Stock options and warrants have been included as common stock
equivalents when they result in dilution of earnings per share. At June 30,
1999, stock options and warrants were not included as they would be
antidilutive.
NOTE D--CASH AND CASH EQUIVALENTS
Restricted cash of $600,000 is not included in cash and cash equivalents as it
is restricted for a performance bond relating to the Company's contract with
China Steel Corporation (the "China Steel Contract"). Potential issues have been
brought to current management's attention regarding the budget to meet certain
of the performance specifications of the China Steel Contract and the overall
viability of the LEC technology for wide-scale commercialization. If the LEC
technology does not meet contract specifications, China Steel Corporation may
seek to impose financial penalties or attempt to recover damages or obtain other
relief under the contract, including drawing down on the $600,000 performance
bond posted by the Company. See note E of Notes to Consolidated Financial
Statements for additional information.
<PAGE>
NOTE E--DISPOSAL OF ENVIRONMENTAL OPERATIONS SEGMENT
On October 31, 1997, ETS Analytical Services, Inc. ("ETSAS"), a wholly owned
subsidiary of the Company, sold substantially all of its assets in return for a
ten-year 8.5% promissory note in the amount of $1,000,000, which exceeded the
net book value of the assets and liabilities sold. Also, since the risks of
ownership were not transferred to the purchaser, no sale was recognized for
accounting purposes. Accordingly, the assets and liabilities transferred to the
purchaser remain in the noncurrent sections of the balance sheet and are
designated as "assets under contractual arrangements" and "liabilities of
business transferred under contractual arrangements." At June 30, 1999, "assets
under contractual arrangements" was stated net of a valuation allowance of
$858,000.
On March 12, 1998, substantially all of the assets and certain liabilities of
ETS, Inc. ("ETS"), a wholly owned subsidiary of the Company, were sold to ETS
Acquisition, Inc., a newly formed firm based in Roanoke, Virginia. In connection
with this sale, the Company sold a portion of its assets and business relating
to the LEC technology, including patents and licenses, to Christel Clear
Technologies, Inc. ("CCTI"), a newly formed firm based in Roanoke, Virginia.
Also, the Company will receive 50% of all royalties received by CCTI in
connection with the license of the LEC technology. While there is no indication
that the LEC will be resold by CCTI, the agreement further provides that the
Company will receive 50% of the net sales price from a resale of the LEC
technology on or before March 12, 1999, and 25% of the net sales price from a
resale after March 12, 1999 but on or before March 12, 2000.
In connection with the foregoing transaction, the Company entered into a
Management Agreement with Air Technologies, Inc. ("ATI"), a newly formed firm
based in Roanoke, Virginia, to provide management services with respect to the
Company's China Steel Contract. ATI and CCTI agreed to accept responsibility for
any potential liabilities associated with the China Steel Contract and to
provide its best effort to have the contract transferred from the Company to
ATI. ETS Acquisition, Inc., CCTI and ATI are owned by three former executive
officers of the Company or ETS and former members of the Company's Board of
Directors.
If the LEC technology does not meet contract specifications China Steel
Corporation may seek to impose financial penalties or attempt to recover damages
or obtain other relief under the contract, including drawing down on the
$600,000 performance bond posted by the Company. See note D and note F of Notes
to Consolidated Financial Statements for additional information.
NOTE F--CONTINGENT LIABILITIES AND OTHER MATTERS
Management believes that the existing potential liabilities under the China
Steel Contract make obtaining significant outside financing difficult. However,
Management negotiated a line of credit from BB&T for $1,000,000 effective
April 16, 1999. The interest rate is prime plus one percent payable monthly.
Additional equity or credit is being sought. Management's success in this
regards will, to a large extent, depend upon whether InfraCorps is able to
accomplish the assignment without recourse of the China Steel contract to ATI.
While negotiations with China Steel Corporation are on-going, there can be
no assurance that such negotiations will be successful. See Notes D and E of
Notes to Consolidated Financial Statements for additional information.
<PAGE>
NOTE G--DISPOSAL OF FLORIDA OPERATIONS
On November 30, 1998, the Florida operations were discontinued. All assets were
sold, transferred to Virginia or abandoned. Current operations should be
completed by September 1999. Due to the unique licensed construction techniques
employed, Management believes that its Florida operations constitute a separate
line of business. Revenues for the period ended June 30, 1998 were $380,761.
NOTE H--OFFICER LOANS
On June 30, 1999, the Company accepted 96,556 shares of stock in repayment of
the loans to officers in the amount of $193,112. These funds were used to buy
these shares of stock during the merger in 1994.
<PAGE>
ITEM 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Forward Looking Statements
From time to time, the Company may publish forward-looking statements
relating to such matters as anticipated financial performance, business
prospects, technological developments, new products, research and development
activities and similar matters. The Private Securities Litigation Reform Act of
1995 provides a safe harbor for forward-looking statements. In order to comply
with the terms of the safe harbor, the Company notes that a variety of factors
could cause the Company's actual results and experience to differ materially
from the anticipated results or other expectations expressed in the Company's
forward-looking statements. The risks and uncertainties that could significantly
affect the operations, performance, development and results of the Company's
business include, but are not limited to, the following: (i) changes in
legislative enforcement and direction, (ii) unusually bad or extreme weather
conditions, (iii) unanticipated delays in contract execution, (iv) project
delays or changes in project costs, (v) unanticipated changes in operating
expenses and capital expenditures, (vi) sudden loss of key personnel, (vii)
abrupt changes in competition or the political or economic climate, and (vi)
abrupt changes in market opportunities.
Results of operations
Three months ended June 30, 1999 compared to three months ended June 30, 1998
All of the revenues and expenses for the Florida operations have been
removed from continuing operations for the period ended June 30, 1998. Revenues
for the three month period ended June 30, 1999 ("first quarter of fiscal 2000")
were $4,934,009 compared to $3,910,161 for the three month period ended June 30,
1998 ("first quarter of fiscal 1999") resulting in a 26% increase in revenues.
This increase is due to large contracts received near fiscal year end 1999 as
well as increase in construction and rehabilitation activity in the region.
Cost of goods and services for the first quarter of fiscal 2000 were
$4,270,668 or 86.5% of sales compared to $3,229,344 or 82.5% of sales for the
first quarter of fiscal 1999. Gross profits (losses) for the first quarter of
fiscal 2000 were $663,341 or 13.5% of sales compared to $680,817 or 17.5% of
sales for the first quarter of fiscal 1999. These decreases in gross profits are
due to larger contracts being awarded based on low bid having a lower gross
margin.
Selling, general and administrative expenses were $583,850 for the
first quarter of fiscal 2000 or 11.8% of net sales compared to $649,060 or 16.6%
of net sales for the three month period ended June 30, 1998. The general and
administrative expense decreased in the first quarter due to cost savings
associated with the management reorganization as well as year end reporting.
Gain on sale of assets was $695 for the first quarter of fiscal 2000
compared to $329,478 for the first quarter of fiscal 1999 which reflected the
sale of the Service Division of ETSW in fiscal 1999. Interest expense for the
first quarter of fiscal 2000 was $56,095 compared to $135,881 for the first
quarter of fiscal 1999. Interest expense reflects interest paid on notes payable
and long-term debt, including credit lines and capital leases.
<PAGE>
Profit for the first quarter of fiscal 2000, before interest income and
expense and gains on the sale of equipment, was $79,491 compared to income of
$31,757 for the three month period ended June 30, 1998. Discontinued operations
is the Florida operations. These operations were closed prior to the beginning
of fiscal 2000. These operations accounted for a loss of $210,043 for the three
month period ended June 30, 1998 on revenues of $380,761.
Net profit for the first quarter of fiscal 2000 from operations was
$34,243 compared to net profit of $26,353 for the first quarter of fiscal 1999.
Liquidity And Capital Resources As Of June 30, 1999
In April 1999, a secured credit line of up to $1,000,000 was obtained.
The note that established the line calls for a monthly interest of prime plus 1%
over a three year term. At June 30, 1999, the balance owed under this line was
$950,000. The credit line is provided by BB&T.
On April 30, 1999, the Company issued 100,000 shares of preferred stock
for an investment of $100,000 which was used to start InfraCorps Technology,
Inc.("ICTI"). These funds were used to acquire the equipment for the business.
In the first quarter, ICTI had $181,683 in revenues. ICTI is negotiating to
acquire the license to manufacture and install FirstlinerUSA pipe. Firstliner
USA pipe is a cured-in-place-process ("CIPP") pipe. This product is different
from the other products offered by ICVA. It can be manufactured in diameters up
to 120 inches. The market for the license would be Virginia and Maryland along
with any other unlicensed market. ICTI would have right of first refusal for the
states of North Carolina, South Carolina, Pennsylvania, New Jersey and Delaware.
On June 30, 1999, the Company accepted 96,556 shares of stock in
payment of the loans to officers in the amount of $193,112. These loans were
used to buy these shares of stock during the merger in 1994.
Major components of cash flows used in operating activities include a
decrease in accounts payable of $429,678, decrease in accounts receivable of
$43,291 and a decrease in accrued expenses of $78,095. The credit line was used
to reduce accounts payable and accrued expenses. Adjustments to net cash flows
include depreciation and amortization of $107,324.
Net cash used in investing activities of $658,891 consisted mainly of
purchase of property, plant and equipment in the amount of $652,628. The net
cash from financing activities of $1,015,469 include in part proceeds from line
of credit of $950,000, proceeds from notes payable of $287,500 and repayment of
bank overdraft of $225,132. The cash and cash equivalents at June 30, 1999 was
$198,248 which excludes the $600,000 of restricted cash guaranteeing the bond
for the China Steel contract.
<PAGE>
New orders received for the first quarter of fiscal 2000 were
$8,827,164 compared to $12,350,634 for the first quarter of fiscal 1999. Backlog
at June 30, 1999 was $15,955,000 compared to $12,362,000 at June 30, 1998. New
orders are being received to keep pace with work being performed and maintain a
backlog.
Year 2000
Many currently installed computer systems and software products are
programmed to assume that the century portion of a date as "19" to conserve the
use of storage and memory. This assumption resulted in the use of two digits
(rather than four) to define an applicable year.
Accordingly, computer systems that rely on two digits to define an applicable
year may recognize a date using "00" as the year 1900, rather than the year
2000. This could result in a system failure to miscalculations causing
disruptions of operations, including, among other things, a temporary inability
to process or transmit data or engage in normal business activities. The
Company's ability to operate is, to a large extent, dependent upon the proper
operation of its computer system and those of its customers. To the extent that
Year 2000 issues result in the long-term inoperability of Company's computer
systems or those of its customers, the Company's results of operation and
financial condition will be materially and adversely affected.
The Company believes that it has fully assessed its Year 2000
readiness. This assessment included a review of the Company's internal
information technology systems and non-information technology systems. Based on
this review, the Company does not anticipate any disruption of its internal
technology systems.
The Company is currently in the process of initiating formal
communications with all of its customers to determine the extent to which the
company is vulnerable to those third parties' failures to remediate their own
Year 2000 issues. The Company expects to complete this process by December 31,
1999. Although the cost of the Company's Year 2000 remediation program has not
yet been finalized, the Company estimates that these costs will not exceed
$30,000 and, in any event, believes that such costs will not have a material,
adverse effect upon the Company's results of operation or financial condition.
New Businesses
The Company started up two new businesses during the first quarter.
These businesses are ICTI and InfraCorps International, Inc. ("ICII"). ICTI is a
trenchless technology company that uses CIPP pipe for installation and
rehabilitation of water, sewer and gas lines. ICTI is in negotiation to acquire
the FirstlinerUSA license for the CIPP pipe. The market would include Virginia
and Maryland along with any other unlicensed market. ICTI would have right of
first refusal to be licensed for the states of North Carolina, South Carolina,
Pennsylvania, New Jersey and Delaware. The license would include a royalty
payment for each foot installed. ICTI will be headed by Richard Herrick who has
30 years experience in the industry.
The second business started during the quarter is ICII. This is an
engineering consulting company that specializes in design and management support
for projects involving the utilization of trenchless technologies. It is headed
by Michael Kirby, P.E. who is an engineer with 20 years experience in the
trenchless technology industry. ICII is currently working on a project for
Baltimore Gas and Electric. The market for ICII will be worldwide.
<PAGE>
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
None
Item 2. Changes in Securities.
None
Item 3. Defaults upon Senior Securities.
None
Item 4. Submission of Matters to a Vote of Security-Holders.
None
Item 5. Other Information.
None
Item 6. Exhibits and Reports on Form 8-K.
(A) Exhibits
27 Financial Data Schedule
(B) Reports on Form 8-K
None
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this registrations statement to be signed on its
behalf by the undersigned, thereunto duly authorized.
INFRACORPS, INC.
DATE August 16, 1999 BY: s/ James B. Quarles
--------------- ------------------------------
James B. Quarles
Chairman and President
DATE August 16, 1999 BY: s/ Warren E. Beam, Jr.
--------------- ------------------------------
Warren E. Beam, Jr.
Secretary and Controller
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FINANCIAL
STATEMENTS FOR THE THREE MONTH PERIOD ENDED JUNE 30, 1999 AND IS QUALIFIED IN
ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-2000
<PERIOD-END> JUN-30-1999
<CASH> 198,248
<SECURITIES> 0
<RECEIVABLES> 3,495,550
<ALLOWANCES> 50,000
<INVENTORY> 635,812
<CURRENT-ASSETS> 5,198,346
<PP&E> 6,651,823
<DEPRECIATION> (3,936,508)
<TOTAL-ASSETS> 9,111,691
<CURRENT-LIABILITIES> 5,387,740
<BONDS> 895,297
0
1,900,635
<COMMON> 5,933,226
<OTHER-SE> (5,145,544)
<TOTAL-LIABILITY-AND-EQUITY> 9,111,693
<SALES> 0
<TOTAL-REVENUES> 4,934,009
<CGS> 0
<TOTAL-COSTS> 4,270,668
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (56,095)
<INCOME-PRETAX> 34,243
<INCOME-TAX> 0
<INCOME-CONTINUING> 34,243
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 34,243
<EPS-BASIC> .00
<EPS-DILUTED> .00
</TABLE>
