SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
(X) QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 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 0-17846
CCAIR, Inc.
Incorporated under the laws of Delaware 56-1428192
(I.R.S. Employer ID No.)
4700 Yorkmont Road, Second Floor
Charlotte, North Carolina 28208
(704) 359-8990
Indicate by a 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 May 8, 1995
Common stock, $0.01 par value 7,381,195
<PAGE>
CCAIR, Inc.
FORM 10-Q QUARTERLY REPORT FOR
FISCAL QUARTER ENDED MARCH 31, 1995
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE NO.
<S> <C>
PART I - FINANCIAL INFORMATION:
ITEM 1. Financial Statements: 3
Condensed Balance Sheets as of
March 31, 1995 and June 30, 1994. 3
Condensed Statements of Income for
the Three and Nine Months ended
March 31, 1995 and 1994. 4
Condensed Statements of Cash Flows
for Nine Months ended March 31,
1995 and 1994. 5
Notes to Condensed Financial Statements. 6
ITEM 2. Management's Discussion and Analysis
of Financial Condition and Results
of Operations. 7
PART II - OTHER INFORMATION:
ITEM 1. Legal Proceedings. 9
ITEM 2. Changes in Securities. 9
ITEM 3. Defaults Upon Senior Securities. 9
ITEM 4. Submission of Matters to a Vote
of Security Holders. 9
ITEM 5. Other Information. 9
ITEM 6. Exhibits and Reports on Form 8-K. 10
SIGNATURES 10
EXHIBIT INDEX E-1
</TABLE>
2
<PAGE>
CCAIR, Inc.
PART I - FINANCIAL INFORMATION
ITEM 1. Financial Statements
CONDENSED BALANCE SHEETS
(Unaudited)
___________
<TABLE>
<CAPTION>
March 31, June 30,
1995 1994
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 448,058 $ 651,020
Receivables, net 5,522,603 5,244,782
Inventories, less allowance for
obsolescence of $466,000 3,127,717 3,192,219
Prepaid expenses and deposits 991,936 3,154,433
Total current assets 10,090,314 12,242,454
PROPERTY AND EQUIPMENT:
Flight equipment and aircraft 19,081,643 17,842,203
Ground and other equipment and
leasehold improvements 4,310,713 3,919,105
23,392,356 21,761,308
Less accumulated depreciation
and amortization 11,131,187 9,423,875
12,261,169 12,337,433
OTHER ASSETS 45,542 49,075
Total assets $22,397,025 $24,628,962
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Notes payable and current
maturities of long-term debt $ 3,026,648 $ 3,395,830
Current obligations under capital leases 344,880 360,196
Accounts payable 3,193,191 3,011,203
Accrued expenses 4,117,109 5,169,610
Total current liabilities 10,681,828 11,936,839
LONG-TERM DEBT, less current maturities 1,909,503 2,570,438
Capital lease obligations, less
current obligations 3,101,901 3,331,314
Deferred credits, net 1,157,936 1,293,920
Noncurrent rent obligations 100,346 124,780
Total liabilities 16,951,514 19,257,291
Commitments and contingencies
SHAREHOLDERS' EQUITY:
Common stock, $.01 par value, 10,000,000
shares authorized, 7,381,195 issued and
outstanding at March 31, 1995 and June 30, 1994 73,812 73,812
Additional paid-in-capital 16,997,186 16,997,186
Accumulated deficit (11,625,487) (11,699,327)
Total shareholders' equity 5,445,511 5,371,671
Total liabilities and
shareholders' equity $22,397,025 $24,628,962
</TABLE>
See notes to condensed financial statements.
3
<PAGE>
CCAIR, Inc.
CONDENSED STATEMENTS OF INCOME
(Unaudited)
___________
<TABLE>
<CAPTION>
3 Months ended March 31, 9 Months ended March 31,
1995 1994 1995 1994
<S> <C> <C> <C> <C>
OPERATING REVENUES:
Passenger $14,238,893 $13,843,902 $44,225,158 $44,700,841
Public service 195,640 167,965 508,125 502,259
Other 525,475 373,613 1,231,346 875,184
Total 14,960,008 14,385,480 45,964,629 46,078,284
OPERATING EXPENSES:
Flight operations 4,826,949 6,358,715 15,959,836 19,178,808
Fuel and oil 1,277,305 1,199,609 4,008,542 3,900,448
Maintenance 2,946,264 2,699,598 8,498,879 8,432,928
Ground operations 1,796,293 2,051,339 5,617,651 7,051,255
Advertising, promotions
and commissions 1,905,928 2,086,509 6,367,388 6,607,328
General and administration 1,090,062 1,233,613 3,497,823 3,317,919
Depreciation and amortization 422,482 399,172 1,277,177 1,153,829
Total 14,265,283 16,028,555 45,227,296 49,642,515
OPERATING INCOME (LOSS) 694,725 (1,643,075) 737,333 ( 3,564,231)
Interest expense ( 242,408) ( 193,976) ( 650,603) ( 547,631)
Other income (expense), net ( 5,226) ( 13,871) ( 12,890) ( 59,503)
Net income (loss) $ 447,091 $(1,850,922) $ 73,840 $(4,171,365)
EARNINGS (LOSS) PER COMMON SHARE $ .06 $( .26 ) $ .01 $( .59 )
WEIGHTED AVERAGE COMMON
SHARES OUTSTANDING 7,614,828 7,180,553 7,607,986 7,015,584
</TABLE>
See notes to condensed financial statements.
4
<PAGE>
CCAIR, Inc.
CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)
___________
<TABLE>
<CAPTION>
Nine Months Ended March 31,
1995 1994
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 73,840 $(4,171,365)
Adjustments to reconcile net loss to
net cash provided by operating activities:
Note discount amortization 260,272 283,301
Depreciation and amortization 3,745,876 3,595,712
Loss on disposal of assets 28,122 18,314
Changes in certain assets and liabilities:
Accounts receivable ( 277,821) (1,930,731)
Inventories 32,404 ( 270,646)
Other note payable ( 801,000) ---
Accounts payable 181,988 1,219,530
Accrued expenses (1,052,501) 3,629,510
Prepaid expenses and deposits 2,464,933 (1,587,756)
Other changes, net ( 160,418) ( 159,220)
NET CASH PROVIDED BY
OPERATING ACTIVITIES 4,495,695 626,649
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (3,689,520) (3,764,239)
Proceeds from sale of assets 23,882 15,103
Change in restricted funds --- ( 14,893)
NET CASH USED BY
INVESTING ACTIVITIES (3,665,638) (3,764,029)
CASH FLOWS FROM FINANCING ACTIVITIES:
Issuance of common stock --- 274,125
Increase in borrowings under
line of credit 2,000,000 ---
Issuance of notes and long-term debt 1,493,054 2,973,395
Reductions of notes and long-term debt (4,526,073) (2,675,173)
NET CASH PROVIDED (USED) BY
FINANCING ACTIVITIES (1,033,019) 572,347
Net decrease in cash ( 202,962) (2,565,033)
Cash, beginning of period 651,020 2,745,157
CASH, END OF PERIOD $ 448,058 $ 180,124
</TABLE>
See notes to condensed financial statements.
5
<PAGE>
CCAIR, Inc.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(Unaudited)
___________
1. Basis of Presentation:
The condensed financial statements included herein
have been prepared by CCAIR, Inc. (the "Company"),
without audit, pursuant to the rules and regulations
of the Securities and Exchange Commission. These
condensed financial statements reflect all adjustments
which are, in the opinion of management, necessary for
a fair statement of results for the interim period.
These adjustments consist solely of normal recurring
adjustments. Certain information and footnote
disclosures normally included in the financial
statements prepared in accordance with generally
accepted accounting principles have been condensed or
omitted pursuant to such rules and regulations,
although the Company believes that the disclosures are
adequate to make the information presented not
misleading. It is suggested that these condensed
financial statements be read in conjunction with the
financial statements and the notes thereto included in
the Company's annual report for fiscal year ended June
30, 1994.
2. Earnings (Loss) Per Common Share:
The computation of earnings (loss) per common share is
based on the weighted average number of common shares
outstanding for each period, after considering the
effect of common stock equivalents.
3. Commitments and Contingencies:
The Company is subject to the regulatory authority,
among others, of the Federal Aviation Administration
and the Department of Transportation. These agencies
require compliance with their standards and conduct
safety and compliance audits. Violations, if any, of
these regulations subject the Company to fines or
sanctions. The Company is also subject to other
claims arising in the ordinary course of business. In
the opinion of management, the outcome of these
matters would not have a material adverse impact on
the Company's financial condition or results of
operations.
4. Lease Activity:
As further discussed in Notes 5 and 13 to the
financial statements included in the Company's 1994
Annual Report on Form 10-K, the Company has entered
into revised aircraft lease agreements with Jet
Acceptance Corporation ("JACO"), effective September
1, 1994, for the Company's twelve Jetstream 31
aircraft and with Short Brothers (USA), Inc.
("Shorts"), effective October 1, 1994, for the
Company's nine Shorts 360 aircraft. These agreements
provide for reduced lease payments aggregating
approximately $194,000 per month from October 1, 1994
to December 31, 1995. While the revised agreements
expire on December 31, 1995, the Company has entered
into preliminary negotiations with both JACO and
Shorts to extend the reduced lease payments over the
remainder of the terms of the original agreements.
The Company believes that such negotiations will be
finalized before the end of the fiscal year.
Accordingly, lease payments have been expensed as paid
in these financial statements and $511,000 of rent
payments previously recorded using the straight line
method over the remaining terms of the leases and
included in noncurrent rent obligations in the
condensed balance sheet as of December 31, 1994 have
been recorded as a reduction in lease expense in the
quarter ended March 31, 1995.
In November, 1994, CIT Leasing Corporation, with the
financial assistance from the Company's credit
insurer, acquired the interest of Mellon Financial
Services Corporation #3 in the Company's four Dash 8
aircraft. In connection with this transaction, new
lease agreements were signed which will result in an
annual reduction of approximately $680,000 in rental
and lease insurance payments. In addition, in the
second quarter of 1995 the Company reversed
approximately $585,000 of accrued rental payments
previously due to Mellon. This amount was reflected
as a reduction in lease expense.
6
<PAGE>
CCAIR, Inc.
FISCAL QUARTER ENDED MARCH 31, 1995
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
General
In the nine-month period ended March 31, 1995, the
Company had net income of $73,840, or $.01 per share, versus
a net loss of $4,171,365, or $.59 per share, in the same
period in 1994. The cost reduction plan initiated by the
Company reduced operating costs by 8.9%, which was the
principal factor in the improvement from the prior year
results.
The expense reductions plus a reversal of previously
accrued rental expense of approximately $511,000 (see Note
4), were primarily responsible for net income of $447,091 or
$.06 per share for the three-month period ended March 31,
1995. Those results compared to a net loss of $1,850,922 or
$.26 per share in the prior year.
Results of Operations
The following table sets forth selected operating
comparisons for the three- and nine-month period ended March
31, 1995 and 1994:
<TABLE>
<CAPTION>
Airline Operating Statistics
For the Three Months For the Nine Months
Ended March 31, Ended March 31,
% %
1995 1994 Change 1995 1994 Change
<S> <C> <C> <C> <C> <C> <C>
Operating revenue $14,960,008 $14,385,480 4.0 $ 45,964,629 $ 46,078,284 ( .2)
Operating expense $14,265,283 $16,028,555 (11.0) $ 45,227,296 $ 49,642,515 ( 8.9)
Revenue passengers carried 179,661 186,247 ( 3.5) 636,699 637,587 ( .1)
Revenue passenger miles (1) 31,069,147 31,730,766 ( 2.1) 106,210,644 108,716,562 ( 2.3)
Available seat miles (2) 75,586,254 65,858,299 14.8 226,011,956 215,170,764 5.0
Passenger load factor (3) 41.1% 48.2% (14.7) 47.0% 50.5% ( 6.9)
Passenger breakeven load factor 39.8% 53.9% (26.2) 47.0% 54.0% (13.0)
Yield per revenue passenger
mile (4) 45.8(cent mark) 44.2(cent mark) 3.6 41.6(cent mark) 42.1(cent mark) ( 1.2)
Operating cost per available
seat mile 18.9(cent mark) 24.3(cent mark) (22.2) 20.0(cent mark) 23.1(cent mark) (13.4)
Average passenger trip (miles) 172.9 170.4 1.5 166.8 170.5 ( 2.2)
Average daily aircraft utilization
per plane (block hours) 8.5 7.2 18.1 8.1 7.3 11.0
Average passenger fare $79.25 $74.33 6.6 $69.46 $70.11 ( .9)
Completion factor 93.4% 92.6% .9 94.8% 95.2% ( .4)
</TABLE>
(1) One revenue passenger transported one mile.
(2) The product of the number of aircraft miles
and the number of available seats on each
stage, representing the total passenger
capacity offered.
(3) The ratio of revenue passenger miles to
available seat miles, representing the
percentage of seats occupied by revenue
passengers.
(4) The operating revenue per revenue passenger mile.
For the Three Months Ended March 31, 1995 Compared to
Three Months Ended March 31, 1994
The Company recorded net income of $447,091 for the
three-month period ended March 31, 1995. This represents a
significant improvement over the net loss of $1,850,922
recorded in the comparable quarter of fiscal 1994.
7
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS, continued
Results of Operations, continued
Operating revenue increased by 4.0% over the prior
year, principally due to industrywide fare increases
implemented in the third quarter of fiscal 1995. These
increases resulted in a 3.6% improvement in the yield, which
was 45.8(cent mark) in the third quarter of 1995 versus
44.2(cent mark) in the corresponding quarter in 1994.
The third quarter revenue per passenger mile exhibited a
significant 14.8% increase over the yield experienced in the
second quarter of this year. Average aircraft utilization
increased 18.1% from an average of 7.2 block hours per day in
1994 to 8.5 hours per day in the current quarter. The Company also
recorded over $200,000 in charter revenue in the third quarter of
1995, principally from college basketball teams. The Company
experienced a 14.7% decline in load factor with an increase
of 14.8% in available seat miles as compared to the prior
year. The Company also focused on its core nondiscretionary
travel market and a segment of the public avoided commuter
airline travel in the wake of commuter accidents in late
1994.
The operating expense reductions in the three-month
period ended March 31, 1995 were the result of cost
reduction efforts undertaken in the first and second
quarters of this year. Aircraft lease expense was
significantly reduced as fully described in Note 4 above.
In addition, the Company implemented a salary reduction plan
with its pilots in October 1994 which will be phased back in
over eighteen months. Ground operations decreased 12.4%
compared with the corresponding period in 1994 due to lower
per-passenger service fees incurred by the Company per
agreements with USAir and a decrease in the number of
passengers handled. As a result of these cost saving
measures, operating expenses decreased $1,763,272 from the
prior year (11.0%).
For the Nine Months Ended March 31, 1995 Compared to Nine
Months Ended March 31, 1994
The Company generated earnings of $73,840 or $.01 per
share in the nine months ended March 31, 1995, as compared
to a net loss of $4,171,365, or $.59 per share for the nine
months ended March 31, 1994. The improved results were due
to significant reductions in operating expenses.
Operating revenues were flat for the first nine months
of 1995 as compared to 1994 as a 1.1% decrease in passenger
revenue was offset by a $356,000 increase in other revenues,
principally charter and freight revenue increases. The 1.1%
decrease in passenger revenue was due to a 6.9% decline in
load factor and a 1.2% decrease in yield, which was only
partially offset by a 5.0% increase in capacity. The
capacity increase was due to more efficient aircraft
utilization.
The largest operating expense reductions were achieved
in flight operations due to aircraft lease reductions and
decreases in pilot pay expense. Significant reductions were
also obtained in ground operations resulting from lower
per-passenger service fees incurred by the Company per
agreements with USAir and the closing of stations in prior
year periods. These reductions have resulted in the
operating cost per available seat mile falling from 23.1(cent mark)
for the prior year to 20.0(cent mark) in the current year.
Liquidity and Capital Resources
The cash position of the Company remains critical at
March 31, 1995, but the improved operating results of the
Company should provide cash flow, together with a new line
of credit in the amount of $2.5 million, sufficient for the
Company's operations. The key element to improved operating
results is the level of the yield per revenue passenger
mile. While the yield improved in the third quarter of 1995
and has remained at improved levels in April and the early
part of May, fare discounting beyond the control of the
Company could adversely affect future operating results.
On February 10, 1995, the Company obtained a line of
credit in an amount not to exceed $2.5 million from JSX
Capital Corporation ("JSX"). JSX is an affiliate of Jet
Acceptance Corporation, the leasing company for the
Company's fleet of Jetstream 31 aircraft, and British
Aerospace Holdings, Inc., the company that had previously
collateralized the Company's line of credit from
NationsBank, N.A. through a loan purchase agreement. The
line of credit permits the Company to borrow up to 50% of a
borrowing base, consisting of the Company's transportation
and nontransportation charges to Airlines Clearing House,
Inc. or such greater amount as JSX shall determine, but in
no event more than $2.5 million. The line of credit is
secured by all of the Company's accounts receivable, bears
interest at prime + 2% and terminates on December 31, 1995,
but may be extended for successive one-year periods. The
Company had outstanding borrowings of $2,000,000 against
this line of credit at March 31, 1995.
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS, continued
Liquidity and Capital Resources, continued
The capital expenditures of $3,689,520 during the
nine-month period ended March 31, 1995 resulted primarily
from expenditures on major overhaul of engines and on major
spare parts and assemblies. The Company anticipates an
increase in capital expenditures for overhauls of engines on
Dash 8 aircraft but, at the same time, capital expenditures
on the Jetstream 31 and Shorts 360 aircraft should decrease.
As discussed in Note 4 to the condensed financial
statements, the Company has negotiated revised aircraft
lease agreements which provide reduced payments aggregating
approximately $194,000 per month from October 1, 1994 to
December 31, 1995. The Company is currently in negotiations
to further extend reduced lease payments over the remainder
of the terms of the original agreements. Management
believes that this is a key factor in sustaining the
profitability recorded by the Company in the latest two
quarters, and a vital component in providing cash flow
sufficient to provide for capital and operating needs after
December 31, 1995.
In the nine-month period ended March 31, 1995, the
Company used cash provided by operations and other sources
of cash to reduce notes payable and accrued expenses.
On May 7, 1995 the Company added a total of 18 flights
to replace existing USAir or USAir Express service in
markets between Charlotte, NC and Lynchburg, VA;
Jacksonville, NC; and Cincinnati, OH. The Company deleted
15 flights in other markets which will continue to be served
by USAir or another USAir Express carrier. These markets
are between Charlotte, NC and: Asheville, NC; Columbia, SC;
Huntsville, AL; Tri-City, TN; and Wilmington, NC. The
Company will continue to operate in three markets shared
with USAir jets between Charlotte, NC and: Raleigh, NC;
Greenville/Spartanburg, SC; and Lexington, KY.
With the schedule changes and redeployment of flights
in new markets made between February and May, 87% of the
Company's scheduled service is in market pairs not shared
with USAir jets. Management believes that this realignment
of schedules will offer opportunities for increased revenues
while reducing costs through more efficient schedule
operations.
PART II - OTHER INFORMATION
ITEM 1. Legal Proceedings
None to report.
ITEM 2. Changes in Securities
None to report.
ITEM 3. Defaults Upon Senior Securities
None to report.
ITEM 4. Submission of Matters to a Vote of Security Holders
None to report.
ITEM 5. Other Information
None to report.
9
<PAGE>
ITEM 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit No. Exhibit
4 Specimen Common Stock Certificate. (1)
11 Computation of Earnings Per Share.
(b) Reports on Form 8-K
None.
______________________
(1) Incorporated by reference to Registration Statement on
Form S-1, File No. 33-28967.
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.
CCAIR, Inc.
May 11, 1995 By: /s/ Kenneth W. Gann
Kenneth W. Gann, President and
Chief Executive Officer
(Principal Executive Officer)
May 11, 1995 By: /s/ Eric W. Montgomery
Eric W. Montgomery, Vice
President - Finance
(Principal Financial Officer)
10
<PAGE>
EXHIBIT INDEX
Exhibit Filed Sequential
No. Exhibit Herewith At Page No.
2 Revised Plan of Reorganization
4 Specimen Common Stock
Certificate. (1)
11 Computation of Earnings Per Share E-2
_____________________
(1) Incorporated by reference to Registration Statement
on Form S-1, File No. 33-28967.
E-1
<PAGE>
PART II, ITEM 6 EXHIBIT 11
CCAIR, Inc.
COMPUTATION OF EARNINGS (LOSS) PER SHARE (1)
<TABLE>
<CAPTION>
Three Months ended March 31,
1995 1994
<S> <C> <C>
Net income (loss) $ 447,091 $(1,850,922)
Shares
Weighted average number of
shares outstanding 7,381,195 7,131,195
Assuming exercise of options 233,633 49,358
Weighted average number of
shares outstanding,
as adjusted 7,614,828 7,180,553
Income (loss) per share: $ .06 $ ( .26 )
</TABLE>
<TABLE>
<CAPTION>
Nine Months ended March 31,
1995 1994
<S> <C> <C>
Net income (loss) $ 73,890 $(4,171,325)
Shares
Weighted average number of
shares outstanding 7,381,195 6,909,619
Assuming exercise of options 226,791 105,584
Weighted average number of
shares outstanding,
as adjusted 7,607,986 7,015,584
Income (loss) per share: $ .01 $ ( .59 )
(1) Fully diluted average number of shares outstanding, as adjusted and
earnings (loss) per share are the same as calculated for primary for the
periods presented.
</TABLE>
E-2
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains Summary Financial Information extracted from
CCAIR, Inc. Condensed Financial Statements for the fiscal quarter
ended March 31, 1995 and is qualified in its entirety by reference to
such Financial Statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1995
<PERIOD-END> MAR-31-1995
<CASH> 448,058
<SECURITIES> 0
<RECEIVABLES> 5,522,603
<ALLOWANCES> 0
<INVENTORY> 3,127,717
<CURRENT-ASSETS> 10,090,314
<PP&E> 23,392,356
<DEPRECIATION> 11,131,187
<TOTAL-ASSETS> 22,397,025
<CURRENT-LIABILITIES> 10,681,828
<BONDS> 0
<COMMON> 73,812
0
0
<OTHER-SE> 5,371,699
<TOTAL-LIABILITY-AND-EQUITY> 22,397,025
<SALES> 0
<TOTAL-REVENUES> 14,960,008
<CGS> 0
<TOTAL-COSTS> 14,265,283
<OTHER-EXPENSES> 5,226
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 242,408
<INCOME-PRETAX> 447,091
<INCOME-TAX> 0
<INCOME-CONTINUING> 447,091
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 447,091
<EPS-PRIMARY> 0.06
<EPS-DILUTED> 0.06
</TABLE>
