<PAGE>
FORM 10-QSB
U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1995
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
EXCHANGE ACT
For the transition period from to
Commission File Number 0-1561
GREEN ISLE ENVIRONMENTAL SERVICES, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
MINNESOTA 41-0780999
- ------------------------------- --------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
410 - 11TH AVENUE SOUTH, HOPKINS, MINNESOTA 55343
- ------------------------------------------------- ---------
(Address of principal executive offices) (Zip Code)
612/935-7798
- -------------------------------------------------------------------------------
(Issuer's telephone number, including area code)
Check whether the issuer (1) filed all reports required to be filed by Section
13 or 15(d) of the Exchange Act during 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. .
--- ---
As of June 13, 1995 there were outstanding 3,191,520 shares of the registrant's
common stock, par value $.18-3/4 per share.
Traditional Small Business Disclosure Format (check one)
Yes X . No. .
--- ---
1
<PAGE>
PART I. FINANCIAL INFORMATION.
ITEM 1. FINANCIAL STATEMENTS.
GREEN ISLE ENVIRONMENTAL SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
For the three months ended
March 31,
1995 1994
------------ ------------
<S> <C> <C>
Net sales $2,980,774 $3,731,284
Less:
Cost of sales 2,219,212 2,995,956
Depreciation 149,170 153,600
----------- -----------
GROSS PROFIT 612,392 581,728
Selling, general and administrative expenses 553,135 466,036
Depreciation 26,955 22,206
----------- -----------
OPERATING INCOME 32,302 93,486
Other income (expenses):
Interest income 2,275 2,848
Interest expense (93,985) (89,554)
Management fees 30,000 30,000
Other, net 26,612 (23,692)
----------- -----------
TOTAL OTHER EXPENSE (35,098) (80,398)
----------- -----------
INCOME (LOSS) FROM CONTINUING OPERATIONS (2,796) 13,088
----------- -----------
Discontinued Operations:
Loss from discontinued waste
processing operations (538,408) (658,400)
NET LOSS ($541,204) ($645,312)
----------- -----------
----------- -----------
Net loss per common share data:
Income (loss) from continuing operations ($0.00) ($0.00)
Cumulative effect of accounting change
Loss from discontinued operations (0.17) (0.20)
----------- -----------
NET LOSS PER SHARE ($0.17) ($0.20)
----------- -----------
----------- -----------
Weighted average number of shares outstanding 3,191,520 3,191,520
----------- -----------
----------- -----------
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
2
<PAGE>
GREEN ISLE ENVIRONMENTAL SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
------------ ------------
ASSETS
<S> <C> <C>
CURRENT ASSETS:
Cash and cash equivalents $181,897 $209,192
Investments, restricted 250,000 250,000
Accounts receivable, net of allowances of
$7,862 at March 31, 1995 and $20,685 at
December 31, 1994 1,809,968 1,387,124
Inventories 1,270,764 917,329
Other current assets 13,965 23,828
Other assets held for sale 50,000 50,000
------------ ------------
TOTAL CURRENT ASSETS 3,576,594 2,837,473
Net property, plant and equipment 4,356,356 4,425,257
Other assets 509,474
------------ ------------
TOTAL ASSETS $8,442,424 $7,262,730
------------ ------------
------------ ------------
LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT)
CURRENT LIABILITIES:
Debt of Eden Prairie facility guaranteed by parent company,
including accrued interest of $1,656,123 and $1,117,716
at March 31, 1995 and December 31, 1994, respectively $17,164,487 $16,626,079
Current maturities of long-term debt 144,408 151,981
Borrowings under line of credit 2,553,297 2,063,477
Accounts payable, trade 876,498 602,340
Accrued expenses 814,152 613,157
------------ ------------
TOTAL CURRENT LIABILITIES 21,552,842 20,057,034
Long-term debt, less current maturities 234,900 267,385
Other long-term liabilities 500,584 243,009
STOCKHOLDERS' EQUITY (DEFICIT):
Preferred stock, par value $.01 per share;
authorized 2,500,000 shares; none issued
Common stock, par value $.1875 per share;
authorized 9,000,000 shares; issued and
outstanding: 3,191,520 shares at
March 31, 1995 and December 31, 1994 598,410 598,410
Additional paid-in capital 13,710,596 13,710,596
Accumulated deficit (28,154,908) (27,613,704)
------------ ------------
TOTAL STOCKHOLDERS' DEFICIT (13,845,902) (13,304,698)
------------ ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY (DEFICIT) $8,442,424 $7,262,730
------------ ------------
------------ ------------
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
3
<PAGE>
GREEN ISLE ENVIRONMENTAL SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------------------------------
Increase (Decrease) in Cash and Cash Equivalents For the Three Months Ended March 31,
- --------------------------------------------------------------------------------------------------------------
1995 1994
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss ($541,204) ($645,312)
Adjustments to reconcile net loss to net cash
provided (used) by operating activities:
Depreciation and amortization 194,794 175,806
(Gain) Loss on sales of assets (10,000) 28,203
Provision for writedown of assets of discontinued operations
held for sale and accrual of holding period costs 120,000
Provision for writedown of inventories / equipment 15,000 30,000
Changes in operating assets and liabilities:
Accounts receivable (422,844) (443,185)
Inventories (368,434) 451,109
Other assets (28,282) (4,929)
Accounts payable 274,159 (190,059)
Accrued expenses 701,978 364,538
- --------------------------------------------------------------------------------------------------------------
Net Cash Used by Operating Activities (184,833) (113,829)
- --------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of property and equipment 10,000 8,533
Cash paid to purchase Sollami product line (195,000)
Additions to property, plant and equipment (107,224) (42,832)
- --------------------------------------------------------------------------------------------------------------
Net Cash Used in Investing Activities (292,224) (34,299)
- --------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayment of long term debt (40,059) (36,039)
Proceeds from short term borrowings 3,061,638 3,505,899
Repayment of short term borrowings (2,571,817) (3,347,226)
- --------------------------------------------------------------------------------------------------------------
Net Cash Provided by Financing Activities 449,762 122,634
- --------------------------------------------------------------------------------------------------------------
Net Decrease in Cash and
Cash Equivalents (27,295) (25,494)
Cash and Cash Equivalents, Beginning of Period 209,192 321,963
- --------------------------------------------------------------------------------------------------------------
Cash and Cash Equivalents, End of Period $181,897 $296,469
- --------------------------------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------------------------------
Supplemental disclosures of cash flow information:
Cash paid for interest $91,401 $91,459
</TABLE>
The accompanying notes are an integral part of the consolidated financial
statements.
4
<PAGE>
Green Isle Environmental Services, Inc. and Subsidiaries
Notes to Consolidated Financial Statements
(Unaudited)
1. FINANCIAL STATEMENTS:
The unaudited consolidated financial statements of Green Isle Environmental
Services, Inc., and Subsidiaries (the Company) for the three months ended
March 31, 1995 and 1994 reflect, in the opinion of management, all
adjustments (which include only normal recurring adjustments except as
described below) necessary to fairly state the results of the operations
(including discontinued operations) for the interim period. The
consolidated results of operations for any interim period are not
necessarily indicative of results expected for the full year. The
unaudited consolidated interim financial statements should be read in
conjunction with the consolidated financial statements and notes thereto
contained in the Company's 1994 Form 10-KSB.
USE OF ESTIMATES:
The preparation of financial statements in conformity with generally
accepted accounting principals requires management to make estimates
and assumptions that affect the reported amount of assets and
liabilities, disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues
and expenses during the reporting period. Actual results could differ
from those estimates.
2. SELECTED BALANCE SHEET INFORMATION:
<TABLE>
<CAPTION>
Inventories:
March 31, December 31,
1995 1994
----------- -----------
<S> <C> <C>
Raw material and supplies $ 427,654 $ 340,631
Work in process 843,110 576,698
----------- -----------
$ 1,270,764 $ 917,329
----------- -----------
----------- -----------
Property, plant & equipment:
<CAPTION>
March 31, December 31,
1995 1994
----------- -----------
<S> <C> <C>
Land and related improvements $ 206,995 $ 206,995
Building 2,980,607 2,980,608
Machinery and equipment 7,097,560 7,071,605
Office equipment 627,756 602,537
Molds, fixtures and tooling 31,869
Autos and trucks 42,112 42,112
----------- -----------
Total $10,986,899 $10,903,857
Less: accumulated depreciation 6,630,543 6,478,600
----------- -----------
$ 4,356,356 $ 4,425,257
----------- -----------
----------- -----------
</TABLE>
5
<PAGE>
2. SELECTED BALANCE SHEET INFORMATION (cont'd):
<TABLE>
<CAPTION>
Other assets held for sale:
March 31, December 31,
1995 1994
--------- ----------
<S> <C> <C>
Container manufacturing equipment $ 50,000 $ 50,000
Total $ 50,000 $ 50,000
----------- -----------
----------- -----------
Accrued Expenses:
<CAPTION>
March 31, December 31,
1995 1994
--------- ----------
<S> <C> <C>
Interest, excluding accrued interest
associated with Eden Prairie debt $ 30,827 $ 28,243
Payroll, benefits and related taxes 317,967 291,699
Legal and accounting 45,525 104,850
Accrued container warranty 139,327 140,000
Product acquisition expenses 153,226
Accrued retirement and consulting 71,829 38,496
Accrued real estate taxes 39,451
Other 16,000 9,869
---------- -----------
Total $ 814,152 $ 613,157
---------- ----------
---------- ----------
</TABLE>
3. DISCONTINUED OPERATIONS AND RELATED DEBT:
As described in Notes 2 and 3 of the Notes to Consolidated Financial
Statements in the 1994 Form 10-KSB, the Company ceased operations of its
Eden Prairie facility (EPR) effective January 1, 1994 and has undertaken a
formal plan to dispose of its remaining waste processing operations. The
loss from discontinued operations in the first quarter of 1995 includes
accrued interest (including default rate interest) through March 31, 1995.
The Company will continue to accrue interest in future periods through the
date of a final settlement of the debt, which is anticipated in the third
quarter of 1995. The loss from discontinued operations for the three
months ended March 31, 1995 consists of accrued interest of $ 538,408.
As previously announced, the Company closed on the sale of all of the
assets of EPR for $3.8 million on September 1, 1994. A gain of $1,914,534
on the sale of the EPR assets was recorded in the 3rd quarter 1994. The
net proceeds of $3,768,809 from the sale have been used to repay a portion
of the debt underlying the EPR facility. The Company has retained all
liabilities of EPR, including the balance of the loan underlying the
facility which is guaranteed by the Company.
As previously announced, on September 12, 1994, the Company entered into a
settlement agreement with the lender of the debt underlying EPR whereby the
lender agrees not to pursue its rights against the Company under the parent
guarantee of the EPR debt in
6
<PAGE>
return for the following:
1. A Senior Subordinated Secured Note to the lender for $2,750,000 with
interest at 8% per year. Interest will be payable monthly on the
principal balance from time to time remaining unpaid. Principal
payments of $75,000 will be payable quarterly beginning in 1997 and
ending on July 1, 1999, when all outstanding principal and interest is
due.
2. A Junior Subordinated Secured Note to the lender for $1,000,000 with
interest to accrue at 8% per year; principal and interest will be paid
from excess cash flow from operations, if any, with all outstanding
principal and accrued interest due on July 1, 1999.
3. A Net Operating Loss Sharing Agreement under which the Company will
make annual payments to the lender of an amount equal to any tax
savings related to use of up to $15,000,000 in net operating loss
carryforwards.
The Company has also preliminarily agreed to issue to the lender, a
warrant to purchase 3,178,780 shares of Common Stock, exercisable only
in the event of an "ownership change" with respect to the Company for
purposes of Section 382(g) (1) of the Internal Revenue Code of 1986,
as amended. The ownership change would effectively eliminate the net
operating loss sharing Agreement obligation ((3) above) and result in
the effective contribution of any remaining balance of the NOL Sharing
Agreement obligation to contributed capital (shareholders' equity).
Management is currently negotiating definitive agreements with the lender,
although there can be no assurance that a definitive agreement will be
reached.
4. ACQUISITION OF PRODUCT LINE:
On January 9, 1995, the Company purchased the assets, inventory, patents
and patent applications, trademarks and goodwill associated with the Rotary
Vane Actuator business of The Sollami Company. The purchase price was
$326,154 plus contingent payments equal to 8% of net sales made each month,
for the 48 months beginning in February 1995, of rotary vane actuators and
related parts. The total cumulative guaranteed minimum payments are
$295,000, with scheduled amounts due in each of the 4 years. To the extent
cumulative monthly contingent payments do not equal the guaranteed minimum
payment for any 12 month period, the Company will be required to make an
additional payment sufficient to achieve the guaranteed minimum payment for
that year. The excess of acquisition cost over amounts assigned to the net
identifiable assets acquired (Goodwill) is being amortized on a straight
line basis over fifteen years. Other identifiable intangible assets
include value assigned to patents, and a covenant not to compete. Values
assigned to patents are carried at cost less accumulated amortization
7
<PAGE>
calculated on a straight line basis over their estimated useful lives,
which range from seven to fourteen years. The value assigned to the
covenant not to compete is being amortized on a straight line basis over
seven years.
5. ASSET-BASED SHORT-TERM FINANCING ARRANGEMENT:
In January 1995, the Company amended its loan and security agreement with
its asset based lender. The key elements to the amendment include reducing
the short-term demand line of credit to $4,500,000, increasing interest on
borrowings to prime plus 3.75%, and increasing available borrowing by
$125,000 by increasing the advance rate on the certificate of deposit which
partially collateralizes borrowings under the line of credit. Funds
available to the Company pursuant to terms of the line of credit agreement
are dependent upon the level of eligible accounts receivable and plant and
equipment, as defined. The Company is in violation of certain financial
and technical covenants of this agreement and a cross-default covenant due
to the defaults described in Notes 6 and 6(a) of the Notes to the
Consolidated Financial Statements in the Company's 1994 Form 10-KSB. As a
result of these default conditions, the lender may, at its sole discretion
declare the Company in default, discontinue making advances to the Company
and demand immediate repayment of borrowings under the line of credit. If
the lender will continue making advances to the Company, borrowing capacity
under this line of credit is approximately $95,000 at June 13, 1995.
6. AGREEMENT TO SELL REUTER RECYCLING OF FLORIDA, INC.:
Effective June 1, 1995, the Company entered into an agreement to sell
all of the Reuter Recycling of Florida, Inc. stock, which had been
pledged by the Company to the construction lender of Reuter Recycling
of Florida, Inc., to an unrelated third party. As discussed in Note 4
to the Consolidated Financial Statements contained in the 1994 Form
10-KSB, because Reuter Recycling of Florida, Inc. had previously been
deconsolidated from the Company's consolidated financial statements
and the Company will receive no proceeds from the sale, the
transaction will have no impact on the Company's financial position or
results of operations. The management agreement between Green Isle
and Reuter Recycling of Florida, Inc. will be terminated upon the
close of the sale.
7. RECLASSIFICATION:
Certain reclassifications have been made to the 1994 consolidated financial
statements in order to conform with the March 31, 1995 presentation. These
reclassifications did not change the Company's previously reported
financial position or results of operations.
8
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
RESULTS OF OPERATIONS
CONTINUING MANUFACTURING OPERATIONS:
Continuing operations consist primarily of the precision machining
business, which is primarily the manufacture of certain medical
products and other precision machined parts on a contract basis. The
Company has sold most of the equipment used in its plastics
manufacturing operations and substantially all plastics manufacturing
ceased effective August, 1994.
The Company's net revenues from continuing operations for the first
quarter of 1995 decreased by 20.1% from the same period in 1994. The
Company's net revenues for the three months ended March 31, 1995 were
$2,980,774 compared to $3,731,284 for the same period in 1994. The
decrease was due primarily to the elimination of sales to Seagate
Technology, Inc., which effectively ceased after the first quarter of
1994 and is partially offset by increased sales of medical products
and other contract manufacturing products.
Gross profit was 20.5% of net sales for the first quarter of 1995
compared to 15.6% of net sales for the first quarter of 1994. The
higher gross profit was primarily due to the change in the product mix
towards higher-margin medical products and higher margins on sales of
proprietary products. Medical product sales from the Company's two
principal customers accounted for over 73% of net sales in the first
quarter of 1995 compared to 32% of net sales in the first quarter of
1994.
Selling, general and administrative expenses were $580,090 for the
first quarter of 1995 compared to $488,242 for the same period in
1994. The increase in these expenses is primarily due to higher
selling expenses related to marketing of proprietary products
(primarily oil centrifuge units) and legal and accounting costs
related to pursuing restructuring of the debt underlying the EPR
facility.
The Company had no taxable income, and accordingly, recorded no
provision for income taxes during the quarters ended March 31, 1995
and 1994.
During the first quarter of 1995, the Company recorded a loss from
continuing operations of $2,796 or $.001 per share compared to income
from continuing operations of $13,088 or $.004 per share for the same
period in 1994.
9
<PAGE>
DISCONTINUED WASTE PROCESSING OPERATIONS:
As described in Notes 2 and 3 of the Notes to Consolidated Financial
Statements in the Company's 1994 Form 10-KSB, the Company undertook a
formal plan to dispose of its remaining waste processing and recycling
operation located in Eden Prairie, Minnesota during the fourth quarter
of 1993. The Company wrote-down the carrying value of this facility
to its estimated net realizable value, which resulted in a charge
against earnings of $10,800,000 in 1993. The Eden Prairie facility
ceased operations effective January 1, 1994 and on September 1, 1994
the Company closed on the sale of all of the assets of EPR, Inc., a
wholly owned subsidiary of the Company ("EPR") for approximately $3.8
million.
The proceeds from the sale of the assets of EPR have been used to
repay a portion of the debt originally underlying the EPR facility.
The Company retained all liabilities of EPR, including the balance of
the loan underlying the facility (the "EPR loan") which is guaranteed
by the Company. The loss from discontinued operations during the first
quarter of 1995 consists of continuing interest accruals of $538,408
related to the underlying debt. This accrual does not include an
accrual for estimated interest that will be incurred on the debt
underlying the EPR loan between April 1, 1995 and the date of final
settlement, due to uncertainty of the timing of the ultimate
settlement. As described in Note 3 "Discontinued Operations and
Related Debt" in this Form 10-QSB, the Company entered into a
preliminary settlement agreement with the lender of the debt
underlying EPR on September 12, 1994. The lender has agreed not to
pursue its rights against the Company under its guarantee of the EPR
loan in return for a Senior Subordinated Secured Note for $2,750,000,
a Junior Subordinated Secured Note for $1,000,000, a Net Operating
Loss Sharing Agreement (See Note 2 of the Notes to Consolidated
Financial Statements in the 1994 Form 10-KSB), and a warrant to
purchase 3,178,780 shares of Common Stock (See Note 2 of the Notes to
Consolidated Financial Statements in the 1994 Form 10-KSB). Management
is currently negotiating definitive agreements with the lender,
although there can be no assurance that a definitive agreement will be
reached. If final settlement cannot be reached, management may elect
to seek protection under U.S. bankruptcy laws.
LIQUIDITY AND CAPITAL RESOURCES:
The Company currently has negative working capital and is in payment
and technical default of terms of the EPR loan and is in violation of
certain covenants of its demand line of credit agreement. The Company
had a working capital deficit of $17,976,248 at March 31, 1995,
compared to a working capital deficit of $17,219,561 at December 31,
1994. The current ratio was .17 and .14 at March 31, 1995 and
December 31, 1994, respectively. The working capital deficit includes
the Eden Prairie debt because the entire remaining balance of this
10
<PAGE>
loan has been classified as a short-term liability as a result of the
payment, technical and other defaults described in Notes 2 and 6 of
the Notes to the Consolidated Financial Statements included in the
Company's 1994 Form 10-KSB. Until the restructuring agreement with
the lender to EPR is finalized, under the terms of the original loan
agreement, and as a result of the payment and technical defaults, the
lender has the right to demand repayment of the entire outstanding
balance of the loan. In addition, the lender can demand payment of
the default interest rate which is 2% higher than the stated interest
rate of 11.85%. Interest accruals reflecting the incremental charge
for the higher default rate have been established since 1992.
The Company has a $4.5 million line of credit arrangement with an
asset based lender which is collateralized by assets associated with
the manufacturing operations. The Company is in violation of certain
financial and technical covenants contained in this line of credit
agreement, which could result in the lender discontinuing advances and
demanding repayment of all outstanding borrowings. Due to the default
conditions discussed above and borrowing limits related to available
collateral, it is possible that the Company will not be able to borrow
sufficient amounts against this line to meet all the operating cash
needs of the Company. In addition, there can be no assurance that the
asset based lender will continue to disregard these covenant
violations in the future. If the lender takes any action to reduce
the availability of funds to the Company, there may not be sufficient
liquidity to continue operations. As of June 13, 1995, the Company
had borrowed approximately $2,108,000 and had additional availability
of approximately $95,000 under this line.
The Company had negative cash flow for the three months ending March
31, 1995 and its ability to meet its continuing manufacturing
operations cash flow requirements during the remainder of 1995 and
beyond, is dependent on continuing adequate sales and margins in the
manufacturing business.
Management expects a need for capital expenditures to support
equipment upgrading and growth in the Manufacturing Division. In
addition to cash flow generation from operations, the Company expects
to raise needed capital through vendor or other asset based lending
arrangements.
In summary, the Company currently has negative working capital and is
in default under the terms of two outstanding loan agreements. Either
of these two lenders could, at any time, demand full payment of the
underlying debt, which the Company would be unable to satisfy. The
Company's cash flow from operations may not be sufficient to meet the
Company's general operating needs. In the event that the Company
cannot generate sufficient cash flow to meet its commitments, it may
be forced to seek protection under U.S. Bankruptcy laws.
11
<PAGE>
PART II - OTHER INFORMATION
Item 3. Defaults upon Senior Security
See Footnote 3 to Notes to the Consolidated Financial Statements
and Management's Discussion and Analysis, included in Item 1 and
2 of this report 10-QSB, for a description of the status of the
defaults on the loan underlying the Eden Prairie facility and the
Company's line of credit, which is incorporated herein by
reference.
Arrearage (interest and principal) on the Eden Prairie debt as of
June 13, 1995, was approximately $5,000,000.
As of June 13, 1995, the Company had borrowed approximately
$2,108,000 and had additional availability of approximately
$95,000 under its line of credit agreement.
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.
GREEN ISLE ENVIRONMENTAL SERVICES, INC.
--------------------------------------------
(Registrant)
Date: , 1995 By: /s/ James W. Taylor
----------------------------------
James W. Taylor
President, Chief Executive Officer and
Chief Financial Officer (principal
executive and financial officer)
Date: , 1995 By: /s/ William H. Johnson
----------------------------------
William H. Johnson
Controller (principal accounting
officer)
13
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> MAR-31-1995
<CASH> 181,897
<SECURITIES> 0
<RECEIVABLES> 1,809,968
<ALLOWANCES> 0
<INVENTORY> 1,270,764
<CURRENT-ASSETS> 3,576,594
<PP&E> 10,986,899
<DEPRECIATION> 6,630,543
<TOTAL-ASSETS> 8,442,424
<CURRENT-LIABILITIES> 21,552,842
<BONDS> 0
<COMMON> 598,410
0
0
<OTHER-SE> 13,710,596
<TOTAL-LIABILITY-AND-EQUITY> 8,442,424
<SALES> 2,980,774
<TOTAL-REVENUES> 2,980,774
<CGS> 2,368,382
<TOTAL-COSTS> 2,948,472
<OTHER-EXPENSES> 35,098
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 93,985
<INCOME-PRETAX> (541,204)
<INCOME-TAX> 0
<INCOME-CONTINUING> (2,796)
<DISCONTINUED> (538,408)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (541,204)
<EPS-PRIMARY> (.17)
<EPS-DILUTED> (.17)
</TABLE>
