SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
- --- SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended July 1, 1995
------------------------
OR
- --- 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 0-17541
PRESSTEK, INC.
(Exact name of registrant as specified in its charter)
Delaware 02-0415170
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
8 Commercial Street, Hudson, New Hampshire 03051-3907
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (603) 595-7000
- --------------------------------------------------------------------------------
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 (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: As of August 7, 1995, there
were 14,593,595 shares outstanding of the Registrant's common stock, $.01 par
value per share.
<PAGE>
PRESSTEK, INC.
INDEX
PAGE
PART I FINANCIAL INFORMATION
Item 1 Financial Statements
Balance Sheets as of July 1, 1995
(unaudited) and December 31, 1994 3
Statements of Operations for the
three and six month periods ended July 1,
1995 and June 30, 1994 (unaudited) 4
Statements of Cash Flows for the six
month periods ended July 1, 1995
and June 30, 1994 (unaudited) 5
Notes to Financial Statements (unaudited) 6
Item 2 Management's Discussion and Analysis of
Financial Condition and Results of
Operations 9
PART II OTHER INFORMATION
Item 6 Exhibits and Reports on Form 8-K 13
Signatures 14
-2-
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
PRESSTEK, INC.
BALANCE SHEETS
<TABLE>
<CAPTION>
July 1, December 31,
1995 1994
----------- ------------
(Unaudited)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 1,529,286 $ 1,532,636
Marketable securities 2,065,642 254,381
Accounts receivable 5,413,714 4,187,049
Inventory 4,170,143 2,796,165
Other current assets 452,103 756,592
---------- ----------
Total current assets 13,630,888 9,526,823
---------- ----------
MARKETABLE SECURITIES - NON CURRENT 1,973,440 4,807,821
---------- ----------
PROPERTY AND EQUIPMENT:
Machinery and equipment 4,220,572 3,820,160
Furniture and fixtures 360,243 281,844
Leasehold improvements 1,228,840 956,574
Other 42,572 38,184
---------- ----------
Total 5,852,227 5,096,762
Less accumulated depreciation
and amortization ( 2,621,011) ( 2,322,770)
---------- ----------
Property and equipment, net 3,231,216 2,773,992
---------- ----------
OTHER ASSETS:
Patent application costs, net 788,362 685,044
Software development costs, net 574,406 530,350
---------- ----------
Total other assets 1,362,768 1,215,394
---------- ----------
TOTAL $ 20,198,312 $ 18,324,030
========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 1,672,321 $ 1,225,492
Accrued expenses 508,321 276,834
Accrued salaries and employee benefits 429,728 348,784
---------- ----------
Total current liabilities 2,610,370 1,851,110
---------- ----------
STOCKHOLDERS' EQUITY:
Preferred stock, $.01 par value; authorized
1,000,000 shares; no shares issued or
outstanding - -
Common stock, $.01 par value; authorized
25,000,000 shares; issued and outstanding
14,558,318 shares at July 1, 1995;
7,194,020 shares at December 31, 1994 145,583 71,940
Additional paid-in capital 18,980,241 18,437,839
Unrealized loss on marketable securities ( 37,019) ( 199,334)
Deficit ( 1,500,863) ( 1,837,525)
---------- ----------
Stockholders' equity 17,587,942 16,472,920
---------- ----------
TOTAL $ 20,198,312 $ 18,324,030
========== ==========
</TABLE>
See notes to financial statements
-3-
<PAGE>
PRESSTEK, INC.
STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
July 1, 1995 June 30, 1994 July 1, 1995 June 30, 1994
----------------------------- ----------------------------
<S> <C> <C> <C> <C>
REVENUES:
Product sales $ 3,915,541 $ 2,176,362 $ 7,498,954 $ 3,752,622
Royalties and fees from licensees 1,587,906 1,711,119 3,088,744 3,142,096
---------- ---------- ---------- ----------
Total revenues 5,503,447 3,887,481 10,587,698 6,894,718
---------- ---------- ---------- ----------
COSTS AND EXPENSES:
Cost of products sold 2,901,095 1,706,443 5,549,585 3,023,221
Engineering and product development 1,393,688 1,333,354 2,876,900 2,206,002
Marketing 569,713 274,540 953,936 532,023
General and administrative 570,512 392,791 1,026,884 729,937
---------- ---------- ---------- ----------
Total costs and expenses 5,435,008 3,707,128 10,407,305 6,491,183
---------- ---------- ---------- ----------
OTHER INCOME (EXPENSE):
Dividend and interest 95,275 105,805 172,043 211,298
Other - net 24,947 ( 1,166) 8,226 19,834
---------- ---------- ---------- ----------
Other income - net 120,222 104,639 180,269 231,132
---------- ---------- ---------- ----------
INCOME BEFORE INCOME TAXES 188,661 284,992 360,662 634,667
PROVISION FOR INCOME TAXES 12,000 20,000 24,000 50,000
---------- ---------- ---------- ----------
NET INCOME $ 176,661 $ 264,992 $ 336,662 $ 584,667
========== ========== ========== ==========
WEIGHTED AVERAGE NUMBER OF COMMON AND
COMMON EQUIVALENT SHARES 15,933,563 14,370,622 15,733,870 14,624,124
========== ========== ========== ==========
NET INCOME PER COMMON AND COMMON
EQUIVALENT SHARE $ .01 $ .02 $ .02 $ .04
=== === === ===
</TABLE>
See notes to financial statements
-4-
<PAGE>
PRESSTEK, INC.
STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
Six Months Six Months
July 1, June 30,
1995 1994
------------ --------
<S> <C> <C>
CASH FLOWS - OPERATING ACTIVITIES:
Net income $ 336,662 $ 584,667
Adjustments to reconcile net income to net
cash used for operating activities:
Tax benefit of disposition of stock options - 50,000
Depreciation and amortization 406,044 308,654
Provision for warranty cost 177,500 -
Gain on sale of assets ( 8,226) ( 19,834)
(Increase) decrease in:
Inventory (1,373,978) ( 210,285)
Other current assets 304,489 ( 82,405)
Accounts receivable (1,226,665) (1,460,739)
Increase (decrease) in:
Accounts payable and accrued expenses 500,816 ( 624,051)
Accrued salaries and employee benefits 80,944 40,175
--------- ---------
Net cash used for
operating activities ( 802,414) (1,413,818)
--------- ---------
CASH FLOWS - INVESTING ACTIVITIES:
Purchases of property and equipment ( 861,863) ( 843,507)
Increase in other assets ( 198,831) ( 388,757)
Proceeds from sale of equipment 76,300 19,834
Sales and maturities of marketable securities 1,167,413 3,271,569
Purchases of marketable securities - (2,095,152)
--------- ---------
Net cash provided by (used for)
investing activities 183,019 ( 36,013)
--------- ---------
CASH FLOWS - FINANCING ACTIVITIES:
Net proceeds from sale of common stock
and warrants 616,045 1,295,112
--------- ---------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ( 3,350) ( 154,719)
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD 1,532,636 990,004
--------- ---------
CASH AND CASH EQUIVALENTS - END OF PERIOD $ 1,529,286 $ 835,285
========= =========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION -
Income taxes paid $ 52,000
=========
</TABLE>
See notes to financial statements
-5-
<PAGE>
PRESSTEK, INC.
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
JULY 1, 1995
1. BASIS OF PRESENTATION
The unaudited financial statements have been prepared in accordance with
generally accepted accounting principles for interim financial information and
with the instructions to Rule 10 of Regulation S-X. Accordingly, they do not
include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. The financial
information included in the quarterly report should be read in conjunction with
the Company's audited financial statements and related notes thereto for the
year ended December 31, 1994. In the opinion of management, all adjustments
considered necessary for a fair presentation have been included and all such
adjustments were normal and recurring.
The Company was organized as a Delaware corporation on September 3, 1987
and was a development stage company through 1991. In September 1991,
Heidelberger Druckmaschinen A.G. ("Heidelberg"), the world's largest printing
press manufacturer introduced the Company's initial spark discharge based
imaging technology, in a jointly developed product, the Heidelberg GTO-DI. In
1993, after investing substantial effort and resources, the Company completed
the development of PEARL(R), a patented, proprietary, nonphotographic, digital
imaging and printing plate technology for the printing and graphic arts
industries. PEARL's laser diode technology is capable of imaging various types
of Presstek printing plates either off-press or on- press which may then be used
to produce full-color printed materials. PEARL has completely replaced the
Company's spark discharge technology. The GTO-DI was reintroduced in September
1993, utilizing PEARL as its Direct Imaging technology. The Company is now
building an installed base of customers which utilizes its proprietary
consumable printing plates on PEARL equipped Heidelberg presses. During the
second quarter of 1995 the Company commenced shipments of kits to be utilized on
Heidelberg's recently introduced Quickmaster DI 46-4. Presstek is also engaged
in the development of additional products and applications that incorporate its
proprietary PEARL technologies and consumables, including both computer-to-plate
and other direct-to- press applications. At this time, the Company relies on
Heidelberg to generate substantially all of its revenues.
On June 19, 1995, the Company's Board of Directors determined to change its
fiscal year from a calendar year ending December 31 to a fiscal year ending on
the Saturday closest to December 31. Accordingly, the second quarter and six
month periods of 1995 ended on July 1, 1995.
The results of operations for the three and six month periods ended July 1,
1995 are not indicative of results of operations to be expected for the full
year. Certain amounts in the 1994 financial statements have been reclassified to
conform with the 1995 presentation.
2. INVENTORY
Inventory is valued at the lower of cost or market, with cost determined on
the first-in, first-out method. At July 1, 1995 and December 31, 1994, inventory
consisted of the following:
July 1, 1995 December 31, 1994
------------- -----------------
Raw materials $2,066,643 $1,269,607
Work in process 1,530,500 952,704
Finished goods 573,000 573,854
---------- ---------
Total $4,170,143 $2,796,165
========= =========
Finished goods include $396,000 and $393,000 of consumable products available
for resale at July 1, 1995 and December 31, 1994, respectively.
-6-
<PAGE>
3. NET INCOME PER COMMON SHARE
Net income per common share is computed by dividing net income by the
weighted average number of Common Stock and Common Stock equivalent shares
outstanding. Common Stock equivalents represent the dilutive effect of the
assumed exercise of outstanding stock options and warrants.
On April 19, 1995, the Company's Board of Directors declared a two-for-one
stock split, effected in the form of a 100% stock dividend, during the second
quarter of 1995. The split resulted in the issuance of 7,275,972 new shares of
common stock.
On August 2, 1994, the Company's Board of Directors authorized a
five-for-four stock split, effected in the form of a 25% stock dividend, during
the third quarter of 1994. All references to average number of shares
outstanding and prices per share have been restated retroactively to reflect the
splits.
A summary of the calculations for the three and six month periods ended
July 1, 1995, and June 30, 1994 follows:
<TABLE>
<CAPTION>
1995 1994
----------------------------------------------- ----------------------------------------------
Three Months Six Months Three Months Six Months
--------------------- ---------------------- --------------------- ---------------------
Fully Fully Fully Fully
Primary Diluted Primary Diluted Primary Diluted Primary Diluted
------- ------- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net income $176,661 $176,661 $336,662 $336,662 $264,992 $264,992 $584,667 $584,667
======== ======== ======== ======== ======== ======== ======== ========
Weighted average common
shares outstanding 14,527,154 14,558,318 14,470,483 14,558,318 13,625,730 13,968,356 13,822,530 13,968,356
Common equivalent shares from
assumed conversion of
outstanding options and
warrants whose effect are
not antidilutive on earnings
per share 1,950,128 1,967,378 1,947,628 1,967,378 1,573,520 1,573,520 1,586,020 1,586,020
Less shares assumed repurchased
using the treasury method for
calculation of net shares
outstanding ( 543,719) ( 485,133) ( 684,241) ( 485,133) ( 828,628) ( 828,628) ( 784,426) ( 784,426)
---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------
Weighted average common and
common equivalent shares
outstanding 15,933,563 16,040,563 15,733,870 16,040,563 14,370,622 14,713,248 14,624,124 14,769,950
========== ========== ========== ========== ========== ========== ========== ==========
Net income per common and
common equivalent share $ .01 $ .01 $ .02 $ .02 $ .02 $ .02 $ .04 $ .04
===== ===== ===== ===== ===== ===== ===== =====
</TABLE>
-7-
<PAGE>
4. INCOME TAXES
There was no provision for federal income taxes for the three and six month
periods ended July 1, 1995 or June 30, 1994 as a result of net operating loss
carryforwards.
As of July 1, 1995, the Company had net operating loss carryforwards
totaling approximately $11,800,000. The amount of the net operating loss
carryforwards which may be utilized in any future period may be subject to
certain limitations, based upon changes in the ownership of the Company's common
stock.
-8-
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Results of Operations
The Company was organized as a Delaware corporation on September 3, 1987
and was a development stage company through 1991. In September 1991,
Heidelberger Druckmaschinen A.G. ("Heidelberg"), the world's largest printing
press manufacturer introduced the Company's initial spark discharge based
imaging technology, in a jointly developed product, the Heidelberg GTO-DI. In
1993, after investing substantial effort and resources, the Company completed
the development of PEARL(R), a patented, proprietary, nonphotographic, digital
imaging and printing plate technology for the printing and graphic arts
industries. PEARL's laser diode technology is capable of imaging various types
of Presstek printing plates either off-press or on-press which may then be used
to produce full-color printed materials of a quality that industry experts
consider comparable to lithographic industry standards. PEARL can print in color
or black and white, at a lower cost than competitive processes. PEARL has
completely replaced the Company's spark discharge technology. The GTO-DI was
reintroduced in September 1993, utilizing PEARL as its Direct Imaging
technology. PEARL Direct Imaging technology as implemented on the GTO-DI has
been well accepted by the market and the Company is now building an installed
base of customers which utilizes its proprietary consumable printing plates on
PEARL equipped Heidelberg presses. The Company's relationship with Heidelberg
has been expanded to include the development and manufacture of Direct Imaging
kits to be utilized in Heidelberg's new four color, fully automated lithographic
press, the Quickmaster DI 46-4. This press was introduced in May of 1995 at
DRUPA '95, the industry's largest trade show, and was well received. Shipments
of production kits to Heidelberg for use in the Quickmaster commenced in the
second quarter of 1995. This new press incorporates certain improvements to the
Company's PEARL Direct Imaging technologies and employs the Company's recently
developed automatic plate changing cylinder which eliminates the need for
manually changing plates between jobs. Presstek is also engaged in the
development of additional products and applications that incorporate its
proprietary PEARL technologies and consumables, including computer-to-plate and
other direct-to-press applications.
At this time, the Company relies on Heidelberg to generate substantially
all of its revenues.
On June 19, 1995, the Company's Board of Directors determined to change its
fiscal year from a calendar year ending December 31 to a fiscal year ending on
the Saturday closest to December 31. Accordingly, the second quarter and six
month periods of 1995 ended on July 1, 1995.
On April 19, 1995, the Company's Board of Directors authorized
-9-
<PAGE>
a two-for-one stock split, effected in the form of a 100% stock dividend, during
the second quarter of 1995. The split resulted in the issuance of 7,275,972 new
shares of common stock.
Revenues
Revenues for the second quarter of 1995 totaled $5,503,000, an increase of
$1,616,000 (42%) compared to $3,887,000 recorded for the second quarter of 1994.
For the first six months of 1995, revenues increased to 10,588,000 (54%)
compared to $6,895,000 recorded in the first six months of 1994. Product sales
increased $1,739,000 and $3,746,000, respectively, comparing the three and six
month periods in 1995 with the same periods in 1994, principally as a result of
increased sales of the Company's PEARL on-press direct imaging technology, used
in Heidelberg's GTO-DI and the new Quickmaster DI 46-4, and consumable printing
plates.
Costs of Products Sold
Costs of products sold for the second quarter and first six months of 1995
totaled $2,901,000 and $5,550,000 respectively compared to $1,706,000 and
$3,023,000 for the same periods in 1994. These costs include materials, labor,
and overhead associated with product sales as well as anticipated future
warranty costs.
Engineering and Product Development
Engineering and product development expenses for the second quarter and
first six months of 1995 totaled $1,394,000 and $2,877,000, respectively,
compared to $1,333,000 and $2,206,000 for the same periods in 1994. The increase
of $61,000 (5%) for the quarter and $671,000 (30%) for the first six months of
1995 resulted principally from increased expenditures for parts, supplies, and
labor related to the Company's development programs with respect to the
Quickmaster DI 46-4, and other applications of the Company's technologies.
Marketing
Marketing expenses for the second quarter and first six months of 1995
totaled $570,000 and $954,000, respectively, compared to $275,000 and $532,000
for the same periods in 1994. The increases of $295,000 (107%) for the quarter
and $422,000 (79%) for the first six months of 1995 resulted from increased
expenditures for additional personnel and related costs as well as various
promotional activities which included one time DRUPA '95 trade show expenses.
General and Administrative
General and administrative expenses for the second quarter and first six
months of 1995 totaled $571,000 and $1,027,000, respectively, compared to
$393,000 and $730,000 for the same periods in 1994. The increases of $178,000
(45%) for the quarter
-10-
<PAGE>
and $297,000 (41%) for the first six months of 1995 relate principally to
increased expenditures for salaries and other costs required to conduct the
various general and administrative functions of the Company.
Net Income
As a result of the foregoing, the Company realized net income of $177,000
and $337,000 for the second quarter and first six months of 1995 compared to net
income of $265,000 and $585,000 for the same periods in 1994.
Liquidity and Capital Resources
At July 1, 1995, the Company had working capital of $11,021,000, an
increase of $3,345,000 as compared to working capital of $7,676,000 at December
31, 1994. This increase was primarily attributable to net income from operations
of $337,000; noncash items of depreciation and amortization of $406,000 and the
provision for warranty costs of $178,000; a decrease in noncurrent marketable
securities of $2,835,000 and issuances of common stock of $616,000 offset by
additions to property and equipment and other assets of $862,000 and $199,000,
respectively.
Net cash used for operating activities of $802,000 for the first six months
of 1995 resulted primarily from increases in inventory and accounts receivable
of $1,374,000 and $1,227,000, respectively, offset by net income from operations
of $337,000 plus noncash items of depreciation and amortization and provision
for warranty costs of $406,000 and $178,000, respectively, a decrease in other
current assets of $304,000 and increases in accounts payable and accrued
expenses totaling $582,000.
Net cash provided by investing activities of $183,000 resulted principally
from proceeds from the sales and maturities of marketable securities of
$1,168,000 and from the sale of equipment of $76,000 offset by additions to
property and equipment used in the Company's business of $862,000 and increases
in other assets of $199,000.
Net cash provided by financing activities during the first six months of
1995, consisted of $616,000 received from the sale of common stock incident to
the exercise of various stock options and warrants.
-11-
<PAGE>
The Company's agreements with Heidelberg provide that during 1995 the
Company will receive certain royalty payments and be reimbursed for certain
engineering and development work provided to Heidelberg. Further, during the
first six months of 1995, the Company accepted orders totaling $26,800,000 from
Heidelberg. This sum represents equipment and royalty revenues that will result
from shipments of the Company's PEARL digital imaging hardware and software
products. These products will be used by Heidelberg in both its existing GTO-DI
product, as well as its Quickmaster DI 46- 4 digital imaging printing press.
The Company estimates that existing funds and the funds generated under its
agreements with Heidelberg will be sufficient to satisfy its anticipated cash
requirements for its current business operations for the foreseeable future.
Effect of Inflation
Inflation has not had, and is not expected to have, a material impact upon
the Company's operations.
-12-
<PAGE>
PART II - OTHER INFORMATION
---------------------------
Item 4. Submission of Matters to a Vote of Security-Holders.
On May 30, 1995, the Company held an Annual Meeting of Stockholders at
which the election of directors was voted on by common stockholders of the
Company. The results of the vote were as follows:
Mr. Robert Howard, Dr. Lawrence Howard and Messrs. Richard A. Williams,
Robert E. Verrando, Bert DePamphilis and Harold Sparks were elected to serve as
members of the Company's Board of Directors for the ensuing year and until the
election and qualification of their successors.
The votes cast by stockholders with respect to the election of
Directors were as follows:
Votes Cast Votes
Director "For" Withheld
-------- ----- --------
Robert Howard 6,291,487 28,986
Dr. Lawrence Howard 6,303,158 17,315
Richard A. Williams 6,303,799 16,674
Robert E. Verrando 6,301,824 18,649
Bert DePamphilis 6,303,298 17,175
Harold Sparks 6,302,374 18,099
Item 6. Exhibits and Reports on Form 8-K.
(a) None
(b) A Form 8-K for the event dated June 19, 1995 was filed to report a change
in the Company's fiscal year end to the Saturday closest to December 31.
-13-
<PAGE>
SIGNATURES
----------
Pursuant to the requirements 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.
Dated: August 11, 1995
PRESSTEK, INC.
(Registrant)
By: /s/ Richard A. Williams
---------------------------------
Richard A. Williams
Executive Vice President
(Duly Authorized Officer)
By: /s/ Glenn J. DiBenedetto
---------------------------------
Glenn J. DiBenedetto
Chief Financial Officer
(Principal Financial and
Accounting Officer)
-14-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
FORM 10-Q AT JULY 1, 1995 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-30-1995
<PERIOD-END> JUL-01-1995
<CASH> 1,529,286
<SECURITIES> 2,065,642
<RECEIVABLES> 5,413,714
<ALLOWANCES> 0
<INVENTORY> 4,170,143
<CURRENT-ASSETS> 13,630,888
<PP&E> 5,852,227
<DEPRECIATION> 2,621,011
<TOTAL-ASSETS> 20,198,312
<CURRENT-LIABILITIES> 2,610,370
<BONDS> 0
<COMMON> 145,583
0
0
<OTHER-SE> 17,442,359
<TOTAL-LIABILITY-AND-EQUITY> 20,198,312
<SALES> 7,498,954
<TOTAL-REVENUES> 10,587,698
<CGS> 5,549,585
<TOTAL-COSTS> 10,407,305
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 360,662
<INCOME-TAX> 24,000
<INCOME-CONTINUING> 336,662
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 336,662
<EPS-PRIMARY> .02
<EPS-DILUTED> .02
</TABLE>
