U.S. Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-QSB
(X) QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the quarterly period ended: March 31, 1996
( ) TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES ACT OF 1934
For the transition period ended:
Commission File Number: 0-25006
Name of Small Business Issuer in Charter: UNITED PETROLEUM CORPORATION
State or Other Jurisdiction of Incorporation or Organization: DELAWARE
I.R.S. Employer I.D. Number: 13 -3103494
Address of Principal Executive Offices: 4867 N. Broadway
Knoxville, Tennessee 37918 Issuer's Telephone Number: (615) 688-0582
Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Sections 13 or 15(d) of the Securities 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.
(I) Yes (X) No ( ) (2) Yes (X) No ( )
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the numbers of shares outstanding of each of the Registrant's classes
of common stock, as of the latest practicable date:
Common Voting Stock: 4,623,674 Date: May 6, 1996
Transitional Small Business Disclosure Format
(Check One): Yes ( ) No (X)
Page 1 of 16
<PAGE>
UNITED PETROLEUM CORPORATION AND SUBSIDIARIES
INDEX
Part I. Financial Information
Item 1. Financial Statements (Unaudited)
Consolidated balance sheets - March 31, 1996 and December 31, 1995
Consolidated statements of operations - Three months ended March 31,
1996
Consolidated statement of stockholders' equity
Consolidated statements of cash flows - Three months ended March 31,
1996
Notes to consolidated financial statements - March 31, 1996
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
Part II. Other Information
Signatures
Page 2 of 16
<PAGE>
PART I. - Financial Information Item 1. Financial Statements
United Petroleum Corporation and Subsidiaries
Consolidated Balance Sheets
At March 31, 1996 and December 31,1995
Mar. 31, 1996 Dec. 31, 1995
Current Assets
Cash $ 139,021 $ 37,941
Accounts and Notes Receivable $ 76,583 $ 150,532
Inventories $ 535,109 $ 572,808
Other Current Assets $ 308,827 $ 452,937
$ 1,059,540 $ 1,214,218
Property and Equipment
Gas and Oil properties $ 3,166,701 $ 3,050,680
Premises and Equipment (Net) $11,306,116 $11,026,031
Other Assets $ 478,482 $ 251,314
Total Assets $16,010,839 $15,542,243
Liabilities and Stockholders' Equity
Current Liabilities
Accounts Payable $ 491,224 $ 602,137
Accrued Expenses $ 507,411 $ 337,503
Accrued Federal and State Income Tax $ 788 $ 5,160
Bank Line Of Credit $ 250,000 $ 250,000
Current Maturities-Long Term Debt $ 490,838 $ 514,968
$ 1,740,261 $ 1,709,768
Long Term Liabilities
Long Term Debt-Less Current Maturities $ 8,744,260 $ 8,359,890
Unearned Revenue $ 200,000 $ 200,000
Deferred Income Taxes $ 595,333 $ 595,000
$11,279,854 $10,864,658
Stockholders' Equity
Common Stock, $.01 Par Value $ 46,236 $ 46,028
(50,000,000 shares authorized,
4,623,674 and 4,602,840 issued)
Additional Paid-In Capital $ 4,373,055 $ 4,321,748
Retained Earnings $ 311,694 $ 309,809
Total Stockholders' Equity $ 4,730,985 $ 4,677,585
Total Stockholders' Equity & Liabilities $16,010,839 $15,542,243
- - ----------
The accompanying notes are an integral part of these financial statements.
Page 3 of 16
<PAGE>
United Petroleum Corporation and Subsidiaries
Consolidated Statement of Operations
For The Three Month Period Ended March 31, 1996 and 1995
Mar. 31, 1996 Mar. 31, 1995
Revenues $3,344,829 $3,306,345
Cost of Sales $2,217,269 $2,191,418
Gross Profit $1,127,560 $1,114,927
Operating Expenses:
Salaries and Wages $ 253,473 $ 288,571
Payroll Taxes $ 89,602 $ 81,138
Other General and Administrative $ 569,961 $ 447,965
Interest Expense $ 107,007 $ 150,886
Depreciation and Amortization $ 119,136 $ 117,881
$1,139,179 $1,086,441
Other Income (Expense) $ 13,837 $ 11,404
Net Income Before Income Taxes $ 2,218 $ 39,890
Provision For Income Taxes $ 333 $ 5,984
Net Income After Taxes $ 1,885 $ 33,906
Primary Earnings Per Share $ 0.000 $ 0.010
Weighted Average Shares Outstanding 4,623,674 3,413,991
Fully Diluted Earnings Per Share $ 0.000 $ 0.010
Fully Diluted Weighted Average Shares 4,623,674 3,413,991
Outstanding
The accompanying notes are an integral part of these financial statements.
Page 4 of 16
<PAGE>
United Petroleum Corporation and Subsidiaries
Consolidated Statement of Stockholders' Equity
<TABLE>
<CAPTION>
Additional
Common Stock Paid-In Retained
Shares Amount Capital Earnings Total
------ ------ ------- -------- -----
<S> <C> <C> <C> <C> <C>
Balance, January 1,1995 3,413,992 $ 34,140 $ 3,004,449 $ 129,273 $ 3,167,862
Shares issued to effect real
estate acquisitions 150,001 $ 1,500 $ 336,500 $ 338,000
Shares issued related to
private placement 95,810 $ 958 $ (958) $ 0
Shares issued for services 86,374 $ 864 $ 296,179 $ 297,043
Shares issued for exercise
of options less registration
costs of $41,004 614,334 $ 6,144 $ 2,055,313 $ 2,061,457
Shares canceled in settlement
of shareholder receivable (1,867) $ (19) $ (7,918) $ (7,937)
Shares issued in cancellation
of warrants 244,073 $ 2,440 $ (2,440) $ 0
Rounding caused by split 123 $ 1 $ (1) $ 0
Net Income $ 180,536 $ 180,536
Balance, December 31,1995 4,602,840 $ 46,028 $ 5,681,124 $ 309,809 $ 6,036,961
Adjustment to reflect receivable
from shareholder $(1,359,376) $(1,359,376)
December 31, 1995 restated to
reflect shareholder receivable 4,602,840 $ 46,028 $ 4,321,748 $ 309,809 $ 4,677,585
</TABLE>
Page 5 of 16
<PAGE>
United Petroleum Corporation and Subsidiaries
Consolidated Statement of Stockholders' Equity
Continued
<TABLE>
<CAPTION>
Additional
Common Stock Paid-In Retained
Shares Amount Capital Earnings Total
------ ------ ------- -------- -----
<S> <C> <C> <C> <C> <C>
First Quarter 1996
Shares issued for services 18,500 $ 185 $ 51,330 $ 51,515
Shares issued in cancellation
of warrants 2,334 $ 23 ($23) $ 0
Net Income - First Quarter $ 1,885 $ 1,885
Balance, March 31,1996 4,623,674 $46,236 $4,373,055 $311,694 $4,730,985
</TABLE>
Page 6 of 16
<PAGE>
United Petroleum Corporation and Subsidiaries
Consolidated Statements of Cash Flows
For The Three Month Period Ended March 31,1996 and 1995
Mar. 31, 1996 Mar. 31, 1995
Operating Activities
Net Income $ 1,885 $ 33,906
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and Amortization $ 119,136 $ 117,881
Changes in operating assets and liabilities:
Decrease (increase) in -
Accounts notes receivable $ 73,949 ($ 33,786)
Inventories $ 37,699 ($ 15,055)
Other Current Assets $ 144,110 ($ 28,715)
Proceeds from unearned purchase discounts $ 0 $ 40,000
Increase (decrease) in -
Accounts Payable and Accrued Liabilities $ 54,956 ($114,888)
$ 431,735 ($ 657)
Investing Activities:
Property and Equipment Additions ($399,221) ($ 56,758)
Acquisition of gas and oil properties ($116,021) ($ 48,786)
Decrease (increase) in other assets ($227,168) ($185,667)
($742,410) ($291,211)
Financing Activities:
Principal payments on debt ($122,097) ($560,454)
Proceeds from short term borrowings $ 0 $ 135,000
Payments on short term borrowings $ 0 ($ 3,839)
Net proceeds from bank financing $ 482,337 $ 461,250
Proceeds from issuance of common stock $ 51,515 $ 118,268
$ 411,755 $ 150,225
Increase(Decrease) in Cash and Cash Equivalents $ 101,080 ($141,643)
Cash and Cash Equivalents, Beginning of Period $ 37,941 $ 189,350
Cash and Cash Equivalents, End of Period $ 139,021 $ 47,707
The accompanying notes are an integral part of these financial statements.
Page 7 of 16
<PAGE>
United Petroleum Corporation and Subsidiaries
Notes to Consolidated Financial Statements
Periods Ended March 31, 1996 and 1995
Note 1 - Summary of Significant Accounting Policies
Basis of Presentation - The accompanying unaudited consolidated financial
statements have been prepared in accordance with generally accepted accounting
principles for interim financial information and with the instructions to Form
10-QSB of Regulation S-X. Accordingly, they do not include all of the
information and footnotes required by generally accepted accounting principles
for complete statements. In the opinion of management, all adjustments
(consisting of normal recurring accruals) considered necessary for a fair
presentation have been included. Certain reclassifications have been made to the
1995 financial statements in order for them to conform with classifications used
in 1996. Operating results for the three months ended March 31, 1996 are not
necessarily indicative of the results that may be expected for the year ended
December 31, 1996. For further information, refer to the consolidated financial
statements and footnotes thereto included in the Registrant and Subsidiaries'
annual report on Form 10-KSB for the year ended December 31, 1995.
Principles of Consolidation - The consolidated financial statements include the
accounts of United Petroleum Corporation (the "Company") and its wholly owned
subsidiaries, Calibur Systems, Inc. and Jackson-United Petroleum Corporation.
All significant intercompany accounts and transactions have been eliminated in
consolidation. Results of operations of companies purchased are included from
the dates of acquisition.
Business Activities - The Company's business activities are conducted through
its subsidiaries and are contained within two primary industry segments. Calibur
Systems, Inc. operates convenience stores, express lube centers, and car washes
providing a variety of car wash and detail services, gasoline, automotive, food
and beverage and related products throughout middle and eastern Tennessee and
northern Georgia. Jackson-United Petroleum Corporation is a newly formed
corporation for the purpose of developing gas and oil properties and marketing
of gas and oil production. Currently all of the Company's gas and oil properties
are located within the United States in central and eastern Kentucky and are
under development.
Cash and Cash Equivalents - The Company considers cash on hand, deposits in
banks, certificates of deposit and investments with original maturity of three
months or less to be cash or cash equivalents.
Inventories - Inventories are stated at the lower of cost or market. Cost of
gasoline sales is determined using the first-in first-out method. Cost of
convenience store sales is determined using the average retail cost method.
Page 8 of 16
<PAGE>
United Petroleum Corporation and Subsidiaries
Notes to Consolidated Financial Statements - Continued
Periods Ended March 31, 1996 and 1995
Gas and Oil Properties - The Company follows the full cost method of accounting
for gas and oil properties. Accordingly, all costs associated with acquisition,
exploration and development of gas and oil reserves, including directly related
overhead costs, are capitalized.
All capitalized costs of gas and oil properties, including the estimated future
costs to develop proved reserves, are amortized on the unit-of-production method
using estimates of proved reserves. Investments in unproved properties and major
development projects are not amortized until proved reserves associated with the
projects can be determined or until impairment occurs. If the results of an
assessment indicate that the properties are impaired, the amount of the
impairment is added to the capitalized costs to be amortized.
In addition, the capitalized costs are subject to a "ceiling test", which
basically limits such costs to the aggregate of the "estimated present value",
discounted at 10 percent interest rate of future net reserves from proved
reserves, based on current economic and operating conditions, plus lower of cost
or fair market value of unproved properties.
Retail Operations - Property and equipment of the retail operations is stated at
cost. Routine repairs and maintenance are charged to expense as incurred. Upon
disposition, the cost and related accumulated depreciation are removed from the
accounts and resulting gain or loss is reflected in operations of the period.
The Company generally depreciates property and equipment on a straightline basis
over the useful lives of the related assets estimated to be 15 to 20 years for
buildings and improvements, 6 to 10 years for equipment, and 3 to 4 years for
vehicles
Capitalized Interest - The Company capitalizes interest on construction in
progress and expenditures made in connection with exploration and development
projects that are not subject to current amortization. Interest is capitalized
only for the period that activities are in progress to bring these projects to
their intended use.
Income Taxes - Deferred Taxes are provided in accordance with Statement and
Financial Accounting Standards Number 109, Accounting For Income Taxes. Deferred
taxes are provided to account for accumulated temporary differences for assets
and liabilities for financial reporting and income tax purposes, including
alternative minimum taxes. The Company's temporary differences are primarily due
to different financial reporting and tax methods of accounting for depreciation
and intangible drilling costs.
Non-Cash Equity Transactions - Goods and services acquired through the issuance
of the Company's common stock are valued at the fair market value of the stock
on the date of
Page 9 of 16
<PAGE>
United Petroleum Corporation and Subsidiaries
Notes to Consolidated Financial Statements Continued
Periods Ended march 31, 1996 and 1995
acquisition. When restricted shares are issued, the value of the shares given in
exchange is discounted approximately 50 % from the fair market value of freely
traded common stock. It is the intent of management to reduce the discount
related to the issuance of restricted shares if and when the market for the
Company's common stock becomes less volatile and the average daily trading
volume increases significantly.
Page 10 of 16
<PAGE>
Item 2. - Management's Discussion and Analysis of Operations
The Company realized net income of $1,885 for the three month period ended March
31, 1996, compared to net income of $33,906 for the same period last year.
A summary of comparative results between the first quarter of 1996 and the first
quarter of 1995 is as follows:
Quarter Ended Quarter Ended
March 31, 1996 March 31, 1995
Revenue $ 3,344,829 $ 3,306,345
Cost Of Sales 2,217,269 2,191,418
Operating Expenses 1,139,179 1,086,441
Other Income 13,837 11,404
Income Tax Expense 333 5,984
Net Income After Tax $ 1,885 $ 33,906
Revenues were realized as follows:
Quarter Ended Quarter Ended
March 31, 1996 March 31, 1995
Gasoline $ 1,056,127 $ 1,236,404
Car Wash 1,705,520 1,584,329
Oil & Lube 271,437 149,774
Grocery 152,414 147,937
Other Sales 159,331 187,902
Total Revenue For Quarter $ 3,344,829 $ 3,306,346
The Company experienced a decreased gross profit margin on gasoline sales from
9.9 % in the first quarter of 1995 to 7.4 % in the first quarter of 1996. Volume
decreased from 1,191,616 gallons in the first quarter of 1995 to 963,204 gallons
in the first quarter of 1996 for a decrease of 19.2 %. The decrease in gross
profit margin is the result of competitive pressures to keep prices down while,
at the same time, the wholesale price of gasoline was increasing. A substantial
portion of the decrease in gasoline volume can be attributed to the remodeling
at the Company's largest volume gasoline location in Cookeville, Tennessee. The
construction related to the remodeling caused several gasoline islands to be
closed for several weeks.
Page 11 of 16
<PAGE>
Item 2. - Management's Discussion and Analysis of Operations - Continued
Car wash revenue was $121,191 higher for the quarter as compared to the same
quarter last year. Of this amount $111,446 is attributed to the new location in
Sevierville, Tennessee. Same store increases of $9,745 accounted for the balance
of the increase. Even though car wash revenue was higher than the same period
last year management had anticipated the increase to be in the area of
$150,000. It is the belief of management that excessive rainfall in the month of
March prevented the desired level of revenue from being achieved.
Oil and lube revenue was $121,663 higher for the quarter as compared to the same
quarter last year which represents an increase of 81%. Of this amount $108,099
is attributed to the following new locations: (1.) Sevierville, Tennessee, (2.)
Atlanta, Georgia and (3.) Cleveland, Tennessee. Same store increases of $13,564
accounted for the balance of the increase. This trend is expected to continue as
lube centers require approximately two to three years to reach their potential.
As of the end of the first quarter of this year the Company has six oil and lube
centers in operation as compared to three oil and lube centers open at the end
of first quarter in 1995. Revenues from the three above referenced locations are
expected to grow substantially over the next few years.
Operating expenses were $1,139,179 for the first quarter of 1996 as compared to
$1,086,441 for the same period last year. This increase is mainly attributed to
increases in legal and professional fees. Interest and depreciation expenses
were higher for the quarter as compared to last year as a result of the
continued growth in retail locations owned by the Company, however,
approximately $70,000 in interest expense was offset by capitalized interest
associated with the carried cost of non-producing oil and gas properties
presently in the development stage.
Earnings for the first quarter did not meet the expectations of management. The
primary factors associated with the decreased income were: (1.) lower than
desired gasoline margins, (2.) lower than expected gasoline volume and (3.)
lower than expected car wash revenue in the month of March.
As of the date of this report, there has been no production of oil and gas, and
no revenue has been generated from the Company's subsidiary, Jackson-United
Petroleum Corporation. The oil and gas business segment had a net loss ($14,009)
for the quarter ended March 31, 1996.
During the Company's three most recent years, it has drilled four (4)
exploratory wells on the Kentucky leases, all during 1993 and 1994. Natural gas
has been discovered on three (3) of these wells. No gas was discovered in the
fourth well, and the three wells exhibiting the presence of natural gas are
presently shut-in.
Financial Condition - The working capital deficit increased to approximately
$680,000 as of March 31, 1996 as compared to approximately $495,000 as of
December 31, 1995. Management expects this trend to reverse as projects
presently under construction are completed and the corresponding assets and
liabilities are placed into service.
Page 12 of 16
<PAGE>
Item 2. - Management's Discussion and Analysis of Operations - Continued
During 1996, the Company will continue to seek additional sources of capital for
the following reasons:
(1.) To be able to expand the number of retail locations owned or operated by
the Company by a minimum of four new locations per year. In order to maintain
the necessary financial ratios required by the financial industry and sound
business policies the Company is required to use both equity and debt to finance
new locations. This alone will create the need for substantial capital if the
Company's business is to grow at the pace desired by management. No assurance
can be given that the Company will be able to obtain the desired capital.
(2.) To be able to continue to add services such as lube centers and food courts
to existing locations. A typical lube center added to a location already owned
by the Company can cost as much as $200,000 per location. In most cases
financing for such additions can only be arranged for up to three to five years.
For this reason several lube centers financed entirely by debt can have a
substantial effect on the annual debt service of the Company. It is the intent
of management to decrease annual debt service as much as possible and therefore
increase the Companies ability to generate cashflow, which requires that a large
portion of the funds used to complete new lube centers should be provided
through one or more infusions of additional capital.
(3.) To be able to develop the Company's oil and natural gas properties and
perform under the farmout agreement with Penn Virginia Oil and Gas. Without
sufficient capital the Company will not be able to convert the oil and natural
gas properties to a revenue generating asset. No assurance can be given that the
Company will be able to raise sufficient capital to continue the development of
the oil and gas properties such that they become a profitable asset of the
Company.
(4.) To increase overall balance sheet liquidity of the Company. Without the
necessary liquidity to be able to act quickly the Company is deprived of the
opportunity to make acquisitions that could be beneficial.
Expansion and Capital Improvements - As of March 31, 1996 the Company is
committed to certain expansion projects in the retail subsidiary and they are as
follows:
(1.) The Company presently has a new Pennzoil Ten Minute Lube Center under
construction in Oak Ridge, Tennessee which is being built as an extension to the
Company's existing car wash facility at that location. The new lube center
should be open by second quarter of 1996. No further financing is required. A
construction and permanent loan was obtained prior to beginning construction
from a bank in an amount sufficient to cover the estimated costs of the project.
(2.) The Company presently has a free standing food court under construction at
an existing location in Cookeville, Tennessee. The food court should be open
during the second quarter of 1996. No further financing is required. A
construction and permanent loan was obtained prior to beginning construction
from a bank in an amount sufficient to cover the estimated costs of the project.
Page 13 of 16
<PAGE>
Item 2. - Management's Discussion and Analysis of Operations - Continued
(3.) The Company intends to build a new Pennzoil Ten Minute Lube Center at 8016
Kingston Pike in Knoxville, Tennessee. A loan to cover approximately
seventy-five percent of the estimated costs of the project has recently been
approved. The loan is scheduled to close on June 5, 1996 and construction will
begin soon thereafter. Management has identified a source for sufficient funds
to cover the equity requirements related to this project.
(4.) The Company intends to build a new Pennzoil Ten Minute Lube Center in both
Newport, Tennessee and Morristown, Tennessee. No further financing is required.
A loan to cover the majority of the costs associated with the construction of
these two new lube centers was closed in May 1996. Construction is scheduled to
begin in June 1996.
(5.) The Company desires to open three new Exxon branded gasoline locations in
1996. The land for these three projects has already been purchased by the
Company. It is the intent of the Company at this time to convey these properties
to Michael F. Thomas, the Company's chief executive officer, or a third party
and execute a lease with the third party such that the Company will operate the
locations but will not own the locations. The locations are as follows: (1)
Ashville Highway in Knoxville, Tennessee, (2) Cumberland Avenue in Knoxville,
Tennessee and (3) Lee Highway in Chattanooga, Tennessee. Financing for the
Cumberland Avenue property has been approved for the Company's chief executive
officer, Michael F. Thomas, and is expected to close in May 1996. No financing
has been arranged for the other two Exxon branded locations and no assurance can
be given that suitable financing will be available to the Company for these two
projects.
The Company has recently reviewed several potential acquisitions to its retail
subsidiary and several potential acquisitions for the oil and gas subsidiary. As
of the date of this report none of these potential acquisitions have become
commitments of the Company. In the event the Company should desire to make such
an acquisition or acquisitions substantial capital will be required. No
assurance can be given that the Company will be able to acquire the necessary
capital to make such acquisitions.
During the quarter the Company issued 18,500 common shares as payment for
services. All of the shares were issued at market value as of the date of
issuance. Said shares were issued at prices ranging from $2.43 to $3.25 per
share. The aggregate issuance price associated with the issued shares was
$51,515. The majority of the shares were issued for services related to
construction projects in the Calibur Systems, Inc. subsidiary and for services
related to the development of the oil and gas subsidiary, Jackson-United
Petroleum Corporation.
In May 1996, the Company began seeking to raise approximately $3,500,000 in a
private placement of securities to certain sophisticated investors. To date the
Company has received approximately $500,000. No assurance can be given that the
Company will be able to raise the balance of the desired funds.
Page 14 of 16
<PAGE>
Part II - Other Information
Item 1 Legal Proceedings
None, not applicable
Item 2 Changes In Securities
None, not applicable
Item 3 Defaults Upon Senior Securities
None, not applicable
Item 4 Submission of Matters to a Vote of Security Holder
None, not applicable
Item 5 Other Information
On May 2, 1996 the Company entered into a letter of intent with the
Silicon Group, Inc. (hereinafter "SGI") headquartered in Coral Springs,
Florida to acquire eighty percent (80%) of the outstanding shares of
SGI in exchange for up to 500,000 shares of the Company's common stock.
As of the date of this report the Company is not committed to the
acquisition. The Company is presently ascertaining the feasibility of
the SGI acquisition and is presently performing due diligence related
to the potential acquisition.
Item 6 Exhibits and Reports on Form 8-K
(a.) Exhibits - None
(b.) Reports on Form 8-K - None
Page 15 of 16
<PAGE>
Signatures
Pursuant to the requirement 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.
United Petroleum Corporation
Date: 5/14/96 By:/s/ Michael F. Thomas
-------------------------------
Michael F. Thomas
President & CEO
Date: 5/14/96 By:/s/ L. Douglas Keene, Jr.
-------------------------------
L. Douglas Keene, Jr.
Executive Vice President &
Chief Financial Officer
Page 16 of 16
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 139,021
<SECURITIES> 0
<RECEIVABLES> 76,583
<ALLOWANCES> 0
<INVENTORY> 535,109
<CURRENT-ASSETS> 1,059,540
<PP&E> 14,472,817
<DEPRECIATION> 119,136
<TOTAL-ASSETS> 16,010,839
<CURRENT-LIABILITIES> 1,740,261
<BONDS> 0
0
0
<COMMON> 46,236
<OTHER-SE> 4,684,749
<TOTAL-LIABILITY-AND-EQUITY> 16,010,839
<SALES> 3,344,829
<TOTAL-REVENUES> 3,344,829
<CGS> 1,127,560
<TOTAL-COSTS> 1,139,179
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 107,007
<INCOME-PRETAX> 2,218
<INCOME-TAX> 333
<INCOME-CONTINUING> 1,885
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,885
<EPS-PRIMARY> 0.00
<EPS-DILUTED> 0.00
</TABLE>
