SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1999
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from __________ to __________
Commission file number 0-17231
-------
AUTOMOBILE PROTECTION CORPORATION - APCO
(Exact name of registrant as specified in its charter)
Georgia 58-1582432
- --------------------------------------------------------------------------------
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
15 Dunwoody Park Drive, Suite 100
Atlanta, Georgia 30338
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(770) 394-7070
--------------
Registrant's telephone number, including area code
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X] No__.
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date.
Class Outstanding at March 31, 1999
- ------------------------------------------ -----------------------------
Common stock, $.001 par value per share 11,919,934
1
<PAGE>
AUTOMOBILE PROTECTION CORPORATION - APCO
INDEX
<TABLE>
<CAPTION>
Page
----
<S> <C>
Part I. Financial Information
Item 1. Financial Statements.
Consolidated Balance Sheet at March 31, 1999 and
December 31, 1998........................................................................... 3
Consolidated Statement of Income for the Three
Month Period Ended March 31, 1999 and 1998.................................................. 4
Consolidated Statement of Cash Flows for the Three
Month Period Ended March 31, 1999 and 1998 ................................................. 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
Item 2. Changes in Securities
Item 6. Exhibits and Reports on Form 8-K
</TABLE>
2
<PAGE>
AUTOMOBILE PROTECTION CORPORATION - APCO
CONSOLIDATED BALANCE SHEET
(UNAUDITED)
<TABLE>
<CAPTION>
March 31, * December 31,
--------- --------------
1999 1998
---- ----
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents $14,191,806 $19,095,752
Trading securities, at fair value 16,736,432 11,175,598
Held-to-maturity securities, current 1,090,173 1,157,249
Available-for-sale securities, at fair value 1,197,925 775,185
Accounts receivable, net of provision for doubtful
accounts of $150,000 and $150,000 5,377,185 3,223,299
Notes receivable, net of provision for doubtful
accounts of $38,825 and $60,000 2,704,643 2,476,062
Officer and employee receivables 494,328 503,273
Income tax receivable 164,238
Prepaid expenses, inventory and other assets 1,858,796 1,243,079
Deferred tax asset 1,129,310 1,124,240
Restricted cash 10,613,969 10,104,633
----------------- -----------------
Total current assets 55,394,567 51,042,608
Property and equipment, net of accumulated
depreciation of $2,559,773 and $2,449,133 3,462,088 2,761,092
Held-to-maturity securities, non current 298,786 602,950
Deposits to secure licenses 1,077,815 1,066,115
Other assets 56,229 45,209
----------------- -----------------
$60,289,485 $55,517,974
----------------- -----------------
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Premiums, fees and taxes payable $10,613,969 $10,104,633
Accounts payable 2,572,070 2,131,045
Accrued liabilities 8,303,702 7,440,420
Income taxes payable 500,830
----------------- -----------------
Total current liabilities 21,990,571 19,676,098
Deferred income taxes 542,363 433,515
----------------- -----------------
22,532,934 20,109,613
----------------- -----------------
Shareholders' equity:
Common stock; $.001 par value, 40,000,000 authorized,
11,919,934 and 11,810,725 issued and outstanding 11,919 11,810
Additional paid-in capital 22,010,889 21,514,637
Retained earnings 16,564,973 14,803,340
Unearned compensation related to stock options (943,599) (998,899)
Accumulated other comprehensive income 112,369 77,473
----------------- -----------------
Total shareholders' equity 37,756,551 35,408,361
----------------- -----------------
$60,289,485 $55,517,974
----------------- -----------------
</TABLE>
* From audited financial statements contained in Registrant's Annual
Report on Form 10-K for the year ended December 31, 1998.
The accompanying notes are an integral part of these consolidated
financial statements.
3
<PAGE>
AUTOMOBILE PROTECTION CORPORATION - APCO
CONSOLIDATED STATEMENT OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Three Months Ended
------------------ ------------------
March 31, 1999 March 31, 1998
-------------- --------------
<S> <C> <C>
Revenues $30,835,841 $25,813,515
----------------- -----------------
Cost of sales:
Premiums and taxes 19,932,370 15,966,779
Commissions and other costs 3,975,314 4,002,282
----------------- -----------------
Total cost of sales 23,907,684 19,969,061
----------------- -----------------
6,928,157 5,844,454
----------------- -----------------
Expenses:
Compensation, selling and administrative 4,482,302 3,908,354
Depreciation and amortization 120,000 118,000
Interest, dividend and other income (466,778) (352,518)
----------------- -----------------
4,135,524 3,673,836
----------------- -----------------
Income before provision for income taxes 2,792,633 2,170,618
Provision for income taxes 1,031,000 803,000
----------------- -----------------
Net income $1,761,633 $1,367,618
----------------- -----------------
Earnings per share:
Basic $0.15 $0.12
Diluted $0.14 $0.11
Number of shares used in computing earnings per share:
Basic 11,862,000 11,207,000
Diluted 12,796,000 12,287,000
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
4
<PAGE>
AUTOMOBILE PROTECTION CORPORATION - APCO
CONSOLIDATED STATEMENT OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Three Months Ended
------------------ ------------------
March 31, 1999 March 31, 1998
-------------- --------------
<S> <C> <C>
Cash flows from operating activities:
Net income $1,761,633 $1,367,618
----------------- -----------------
Adjustments to reconcile net income to net cash
used in operating activities:
Depreciation and amortization 120,000 118,000
Deferred income taxes 83,284 35,065
Provision for doubtful accounts 20,000
Loss on disposal of property and equipment 1,568
Tax benefit from stock option exercise 260,480 740,000
Stock compensation expense 55,300 35,600
Changes in operating assets and liabilities:
Restricted cash (509,336) (3,167,312)
Accounts receivable (2,153,886) (352,201)
Officer and employee receivables 8,945 (92,569)
Notes receivable (228,581) (769,935)
Prepaid expenses and other assets (626,737) (379,237)
Premiums, fees and taxes payable 509,336 3,167,312
Accounts payable 441,025 532,234
Accrued liabilities 863,282 1,006,199
Income taxes 665,068 (352,020)
Purchases of trading securities (8,564,981) (3,742,776)
Sales of trading securities 3,004,147 1,829,051
----------------- -----------------
Total adjustments (6,071,086) (1,372,589)
----------------- -----------------
Net cash used in operating activities (4,309,453) (4,971)
----------------- -----------------
Cash flows from investing activities:
Purchases of property and equipment (825,064) (321,723)
Proceeds from sales of property and equipment 2,500
Purchases of available-for-sale securities (394,448)
Sales of available-for-sale securities 134,850
Purchases of held-to-maturity securities (95,961)
Redemptions and maturities of held-to-maturity securities 263,488 546,715
Increase in deposits to secure licenses (11,700) (9,164)
----------------- -----------------
Net cash (used in) provided by investing activities (830,374) 119,867
----------------- -----------------
Cash flows from financing activities:
Issuance of common stock 235,881 882,441
Redemption of preferred stock (300)
----------------- -----------------
Net cash provided by financing activities 235,881 882,141
----------------- -----------------
Net (decrease) increase in cash and cash equivalents (4,903,946) 997,037
Cash and cash equivalents at beginning of period 19,095,752 11,297,049
----------------- -----------------
Cash and cash equivalents at end of period $14,191,806 $12,294,086
----------------- -----------------
Supplemental disclosure of cash flow information:
Cash paid during the period for income taxes $20,040 $379,955
----------------- -----------------
</TABLE>
The accompanying notes are an integral part of these consolidated
financial statements.
5
<PAGE>
AUTOMOBILE PROTECTION CORPORATION - APCO
----------------------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------
(Unaudited)
-----------
1. Nature of Business and Summary of Significant Accounting Policies
Automobile Protection Corporation - APCO was incorporated in the State of
Georgia on September 10, 1984. APCO and its wholly-owned subsidiaries (the
"Company") are engaged primarily in the marketing and administration of extended
vehicle service contracts and extended vehicle warranty programs sold by new and
used automobile retailers located throughout the United States. Extended vehicle
service contracts augment and enhance upon the basic warranty offered by the
automobile manufacturer. The Company markets its contracts nationally under the
EasyCare(R) trade name and also administers vehicle service contracts under
private label programs for a major automobile manufacturer and others.
The Company has arranged for insurance coverage for its automobile programs to
be provided by Greenwich Insurance Company, Indian Harbor Insurance Company and
CIGNA Property & Casualty companies. Insurance coverage for its non-automobile
programs is provided by certain Underwriters at Lloyd's of London ("Lloyd's").
In prior years, Lloyd's also directly insured automobile programs. These
insurers underwrite and insure the obligations to pay for covered mechanical
repairs and benefits under all vehicle service contract and warranty programs
marketed and administered by the Company.
The Company's subsidiary, The Aegis Group, Inc., provides a wide range of third
party administrative and insurance brokerage services to companies serving the
automotive industry.
The financial information included herein is unaudited; however, such
information reflects all adjustments, consisting solely of normal recurring
adjustments which are, in the opinion of management, necessary for a fair
presentation of the periods indicated. Certain information and footnote
disclosures normally included in financial statements prepared in conformity
with generally accepted accounting principles have been condensed or omitted
pursuant to the rules and regulations of the Securities and Exchange Commission.
These condensed financial statements should be read in conjunction with the
consolidated financial statements and related notes contained in the Company's
Annual Report on Form 10-K for the twelve months ended December 31, 1998.
The following is a summary of the significant accounting policies followed by
the Company:
Basis of Presentation
- ---------------------
The accompanying consolidated financial statements include the accounts of the
Company and its wholly-owned subsidiaries. All significant intercompany
transactions and balances have been eliminated in consolidation. Certain
comparative amounts have been reclassified to conform with current year
presentation.
Revenues
- --------
Revenues from the sale of extended vehicle service contracts and extended
warranty programs are recognized when the service contract or extended warranty
sold by the dealer is received and accepted by the Company. Revenues are
comprised of the Company's administration fee, underlying insurance premium and
tax.
6
<PAGE>
Cash and Cash Equivalents
- -------------------------
Cash and cash equivalents include all funds with an original maturity of ninety
days or less. Certain funds are considered restricted as they are held for the
benefit of the insurers and to pay claims.
Restricted Cash
- ---------------
Restricted cash represents funds collected by the Company on behalf of its
insurers and claims payment floats provided by the insurers, to enable the
Company to make claims payments on behalf of the insurers, and the related
liability is included in Premiums, fees and taxes payable.
Debt and Marketable Equity Securities
- -------------------------------------
Investments in debt and marketable equity securities are categorized as either
trading, available-for-sale or held-to-maturity. Trading securities are stated
at their fair value, which is based on quoted market prices, and all unrealized
gains and losses are recorded in earnings as incurred. Available-for-sale
securities are stated at fair value, which is based on quoted market prices, and
all unrealized gains and losses are recorded as other comprehensive income
within shareholders' equity. Held-to-maturity securities are stated at their
amortized cost. The market value of the Company's held-to-maturity securities at
March 31, 1999 is $1,499,880.
Property and Equipment
- ----------------------
Property and equipment is stated at cost less accumulated depreciation and
amortization. Depreciation and amortization are calculated using the
straight-line method for financial reporting purposes and accelerated methods
for income tax purposes over the estimated useful lives of the assets ranging
from three to seven years. Maintenance and repair costs are charged to expense
as incurred, and major renewals and betterments are capitalized. When property
and equipment is retired or sold, the related carrying value and accumulated
depreciation are removed from the accounts and any resulting gain or loss is
reflected in income. During 1998, the Company purchased land and commenced the
design and construction of an office building, which is expected to be completed
during the third quarter of 1999.
Premiums, Fees and Taxes Payable
- --------------------------------
Premiums and taxes payable includes premiums due to the insurers or their
agents, taxes payable to various states and amounts advanced to the Company by
the insurers for payment of claims.
Accrued Liabilities
- -------------------
The Company self-insures its obligations to provide emergency roadside
assistance to contract holders and accordingly accrues an estimate of the amount
it expects to pay to provide these services through unaffiliated third parties.
Additionally, the Company reserves for all costs and expenses it expects to
incur under programs with its dealers, such as co-operative advertising.
Advertising costs
- -----------------
The Company sponsors motorsports activities to advertise its products. The
Company has entered into an associate sponsorship agreement with Joe Gibbs
Racing, Inc. and separate agreements with race-track owners to sponsor race
events. Costs associated with the Joe Gibbs Racing, Inc. associate sponsorship
are expensed over the period of the annual contract, while costs associated with
race events are expensed in the month the event takes place.
7
<PAGE>
Income Taxes
- ------------
The Company provides income taxes on income reported for financial statement
purposes. Deferred income taxes are recorded for differences in the recognition
of various items for financial reporting and income tax purposes. The Company
files a consolidated federal income tax return with its subsidiaries.
Stock-based Compensation Plans
- ------------------------------
The Company has elected to account for its stock-based compensation plans under
Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to
Employees" (APB No. 25) with the annual associated disclosure requirements of
Statement of Financial Accounting Standards No. 123, "Accounting for Stock-based
Compensation" (SFAS No. 123). SFAS No. 123 requires that companies which elect
to not account for stock-based compensation as prescribed by that statement
shall disclose annually, among other things, pro forma effects on net income and
net income per share as if SFAS No. 123 had been adopted. Under APB No. 25,
because the exercise price of the Company's employee stock options equals the
market price of the underlying stock on the date of the grant, no compensation
expense is recognized.
Earnings Per Share
- ------------------
The Company follows Statement of Financial Accounting Standards No. 128,
"Earnings per Share" (SFAS No. 128) for the calculation of earnings per share.
Basic earnings per share is based upon the weighted average number of issued
common shares for each period. Diluted earnings per share is based upon the
weighted average number of issued common shares for each period, in addition to
the effect of common stock equivalents (stock options) which are calculated
using the treasury stock method.
Comprehensive Income
- --------------------
The Company adopted Statement of Financial Accounting Standards No. 130,
"Reporting Comprehensive Income" (SFAS 130) as of January 1, 1998. The adoption
of this Statement had no impact on net income or shareholders' equity. SFAS 130
establishes new rules for the reporting and display of comprehensive income and
its components. SFAS 130 requires unrealized gains or losses on
available-for-sale securities to be included in other comprehensive income.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
- -------------------------------------------------------------------------------
of Operations
- -------------
The following discussion and analysis of financial condition and results of
operations presents the more significant factors affecting the Company during
the three month period ended March 31, 1999. The discussion and analysis should
be read in conjunction with the unaudited consolidated financial statements and
related notes appearing elsewhere herein and the Company's Annual Report on Form
10-K for the twelve months ended December 31, 1998.
8
<PAGE>
Forward-Looking Statements
When used herein and in future filings by the Company with the Securities and
Exchange Commission, the words or phrases "will likely result", "management
expects" or "the Company expects", "will continue", "is expected", "is
anticipated", "estimated" or similar expressions are intended to identify
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Readers are cautioned not to place undue reliance
on any such forward-looking statements, each of which speak only as of the date
made. Such statements are subject to certain risks and uncertainties that could
cause actual results to differ materially from historical earnings and those
presently anticipated or projected. The Company has no obligation to publicly
release the result of any revisions which may be made to any forward-looking
statements to reflect anticipated or unanticipated events or circumstances
occurring after the date of such statements.
Certain of these risks and uncertainties are discussed herein. The industry in
which the Company operates is highly competitive, with some competitors having
significantly greater financial resources and name recognition than the Company.
The Company depends on independent sales representatives, automobile dealers,an
automobile manufacturer and financial institutions to market its products. The
distribution of automobiles has been subject to cyclical economic conditions in
the past and could be subject to such conditions in the future. Additionally,
automobile dealer consolidation could reduce the number of dealers and
consequently the Company's addressable market.
Overview
The Company's primary business is the marketing and administration of extended
vehicle service contracts (hereinafter referred to as "VSCs") for automobile
dealers. Dealers often engage a third party administrator, such as the Company,
to design a VSC program, to arrange for insurance to limit their financial risk
and to perform all of the related administrative functions associated therewith.
A function of the Company is to arrange for insurance to cover obligations to
pay all future claims, which the Company does through unrelated insurers,
including: (a) Greenwich Insurance Company, a wholly-owned subsidiary of NAC Re
Corporation, which is rated "A+" (Superior) by A.M. Best; (b) Indian Harbor
Insurance Company, a wholly-owned subsidiary of NAC Re Corporation, which is
rated "A+" (Superior) by A.M. Best; (c) Certain Underwriters at Lloyd's of
London, which is rated "A" (Excellent) by A.M. Best; and (d) CIGNA Property and
Casualty companies, which are rated "A-" (Excellent) by A.M. Best. Greenwich,
Indian Harbor and CIGNA may choose to purchase reinsurance from Lloyd's, NAC Re
Corporation or other reinsurers. Most of the VSC's accepted by the Company for
administration between 1991 and 1996 are insured by Lloyd's. The availability of
insurance coverage at competitive rates and of insurance funds to make claims
payments, including the financial condition of the insurance carriers, is
critical to the Company and any disruption could have a material adverse effect
on the Company.
The Company's reported revenues represent the amount it bills to automobile
dealers, which is based on rate schedules developed by the Company. The amounts
billed consider insurance, taxes, commissions and other costs and profit. The
Company's reported cost of sales represents the amounts it pays to the insurers
for insurance, state insurance taxes and commissions to its sales
representatives.
9
<PAGE>
Liquidity and Capital Resources
The Company believes that its current working capital and anticipated levels of
internally generated funds will be sufficient to fund its operating and capital
expenditure requirements for the foreseeable future. This estimate is based on
the Company's current level of operations and certain assumptions relating to
the Company's business and planned growth. At March 31, 1999, the Company had
working capital of $33,403,996 (compared to $31,366,510 at December 31, 1998)
and investment securities with maturities greater than twelve months of $298,786
(compared to $602,950 at December 31, 1998). The net increase in working capital
and investment securities of $1,733,322 is attributable to operations of the
Company and to proceeds from the exercise of stock options ($235,881), less
payments for the construction of the Company's corporate and administrative
offices ($705,885), payments for Service Advisor Plus by EasyCare software
($250,000) and other equipment purchases ($119,179). The Company expects to
receive a tax benefit from the stock option exercises of $260,480 over the
remainder of the year through lower current tax payments. Under the Company's
1998 agreement with Service Advisor Plus, the Company is required to pay an
additional $1,000,000 for the purchase of the software license. The Company
primarily invests its funds in treasury securities, US agencies, municipal bonds
and financial instruments with maturities of less than five years and money
market accounts. However, in 1998 the Company hired a professional investment
management firm to invest approximately $1,000,000 in a portfolio of equities.
This portfolio is classified as available-for-sale in the accompanying
consolidated financial statements. During 1999, the Company expects to spend an
aggregate of approximately $5,000,000 on the new corporate and administrative
offices. The Company expects to initially fund the construction of these
facilities from working capital.
Results of Operations
Three months ended March 31, 1999 ("1999") compared to the three months ended
- -----------------------------------------------------------------------------
March 31, 1998 ("1998").
- ------------------------
Revenues for 1999 increased by 19% or $5,022,326 to $30,835,841 over 1998. The
Company's largest revenue source is from the marketing and administration of
extended vehicle service contracts ("VSC") and administration of mechanical
breakdown insurance policies ("MBI"), which provided 99% of revenues. VSC
revenues increased due to the introduction of additional automobile dealers to
EasyCare service contracts and increased average production by dealers. The
Company also experienced growth from its agreements with a major dealership
group and from its third party administrative agreement with a major insurance
company. The Company experienced reduced production from its certification
program in 1999 as compared to the first quarter of 1998.
The Company's gross margin was 22.5% of revenues in 1999 compared to 22.6% of
revenues in 1998. Gross margin is impacted by the mix of new and used, makes and
models of vehicles and the types of coverage sold. Management anticipates that
if the new product introductions and private label marketing agreements increase
relative to its current mix of business, average gross margins will decline;
however, the Company anticipates that the effects of this reduction would be
offset by increased volumes from these new arrangements.
Compensation, selling and administrative expenses for 1999 increased by 15% or
$573,948 to $4,482,302 over 1998. The increase for 1999 is primarily
attributable to compensation cost, which increased by approximately $552,000 to
support the growth of the business. During the first quarter, the Company also
recognized a pretax credit of $106,890 to adjust the abandonment reserve
relating to the Company's relocation in 1999, which has been delayed four
months.
10
<PAGE>
Interest, dividend and other income for 1999 increased by 32% or $114,260 to
$466,778 over 1998. The increase is due to the larger balances of investment
securities on hand.
The Company recorded a provision for income taxes in 1999 of $1,031,000 compared
to $803,000 for 1998. The increase is due to higher pretax income.
Year 2000
The Company's proprietary warranty administration system was developed
internally and was designed with large enough "date" fields to accept and
accurately process dates with the year 2000 and later. In fact, many of the
contracts received for administration to date have expiration dates after 1999
and no processing problems have occurred. The Company has reviewed its mission
critical systems and believes they are year 2000 compliant and it will not need
to make significant expenditures to remedy year 2000 problems.
While the Company is satisfied that its mission critical systems are year 2000
compliant, it cannot determine at this stage whether all of its customers'
systems are compliant. The Company receives contracts from three discrete
sources in the following formats:
(a) Automobile dealers - Contracts are submitted in paper form by dealers, who
generally utilize a computerized system to produce the contract form.
(b) Automobile manufacturer - The manufacturer provides the Company with a daily
electronic file of contracts sold by its participating dealers.
(c) Insurance company - The insurance company provides the Company with a daily
electronic file of contracts received and processed at its data center.
Should any of these sources encounter difficulty generating or processing
contracts due to year 2000 problems, the Company could face delays in receiving
service contracts to process, which might delay the recognition of revenues and
adversely impact customer service. The Company is querying its customers as to
their progress in identifying and addressing year 2000 problems.
The Company does not rely on its unrelated insurers' computer systems to a
significant extent to conduct its critical business functions. The Company
recognizes that many automobile components are electronic and contain embedded
chips. From inquiries made of industry sources, the Company is not aware of any
components being "date" sensitive. In the event certain components fail because
of year 2000 problems, the Company's insurers' might be liable for the
replacement or repair of the failed component. If such losses were significant,
the Company's insurers' might increase premiums, thereby impacting the Company's
competitive position and/or profitability.
11
<PAGE>
II. OTHER INFORMATION
Item 2. Changes in Securities
- -----------------------------
During the first quarter of 1999, the Company issued the following securities:
<TABLE>
<CAPTION>
Exemption
Consideration from
Date of sale Title of security Number sold received registration Option terms
- --------------- ----------------- ----------- -------- ------------ ------------
<S> <C> <C> <C> <C>
01/99-03/99 Common stock 24,667 $61,188 4 (2)
issued upon
exercise of
options granted
to customers
and consultant
03/99 Common stock 100 $ - 4 (2)
issued to
employees
</TABLE>
Item 6. Exhibits and Reports on Form 8-K
- ----------------------------------------
(a) Exhibits: None
(b) Reports on Form 8-K: None
12
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
AUTOMOBILE PROTECTION CORPORATION - APCO
/s/ Martin J. Blank May 13, 1999
- ----------------------------------- ------------
Martin J. Blank Date
Secretary (Duly Authorized Officer)
/s/ Anthony R. Levinson May 13, 1999
- ----------------------------------- ------------
Anthony R. Levinson Date
Chief Financial Officer (Principal
Financial and Accounting Officer,
Duly Authorized Officer)
13
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 14,191,806
<SECURITIES> 19,323,316
<RECEIVABLES> 8,576,156
<ALLOWANCES> 188,825
<INVENTORY> 0
<CURRENT-ASSETS> 55,394,567
<PP&E> 3,462,088
<DEPRECIATION> 2,559,773
<TOTAL-ASSETS> 60,289,485
<CURRENT-LIABILITIES> 21,990,571
<BONDS> 0
0
0
<COMMON> 11,919
<OTHER-SE> 37,744,632
<TOTAL-LIABILITY-AND-EQUITY> 60,289,485
<SALES> 30,835,841
<TOTAL-REVENUES> 30,835,841
<CGS> 23,907,684
<TOTAL-COSTS> 23,907,684
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 2,792,633
<INCOME-TAX> 1,031,000
<INCOME-CONTINUING> 1,761,633
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,761,633
<EPS-PRIMARY> 0.15
<EPS-DILUTED> 0.14
</TABLE>
