<PAGE> 1
===============================================================================
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, 1996
Commission file number 1-11600
URETHANE TECHNOLOGIES, INC.
- - -------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Nevada 33-0126369
- - ----------------------------------------------- ------------------
(State of incorporation) (I.R.S. Employer
Identification No.)
1202 East Wakeham Avenue, Santa Ana, California 92705
- - ----------------------------------------------- -----------------
(Address of principal executive offices) (Zip Code)
(714) 973-0800
- - ------------------------------------------------------------------------------
(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
---------- -----------
Number of shares outstanding of each of the registrant's classes of common
stock, as of May 7, 1996: 10,455,737 shares of common stock, $.01 par value.
===============================================================================
<PAGE> 2
URETHANE TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(unaudited)
<TABLE>
<CAPTION>
As of
-----------------------------
March 31, December 31,
1996 1995
----------- ------------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash $ 260,464 $ 908,554
Accounts receivable, net of allowance
for doubtful accounts 5,605,924 4,170,720
Notes receivable 154,981 147,026
Inventories 4,069,819 3,567,395
Prepaid expenses 222,210 180,476
----------- -----------
TOTAL CURRENT ASSETS 10,313,398 8,974,171
----------- -----------
PROPERTY AND EQUIPMENT:
Land 400,000 --
Manufacturing equipment and molds 3,767,071 3,102,981
Office equipment 317,816 253,561
Leasehold improvements 57,610 57,609
Equipment held under capital leases 738,401 767,401
----------- -----------
5,280,898 4,181,552
Less accumulated depreciation and amortization (1,918,193) (1,836,927)
----------- -----------
NET PROPERTY AND EQUIPMENT 3,362,705 2,344,625
----------- -----------
OTHER ASSETS:
Goodwill, net of accumulated amortization 4,597,415 3,141,101
Notes receivable, net of current portion 923,394 866,673
Patents and other intangible assets, net of
accumulated amortization 422,812 301,321
Other assets 244,881 232,906
----------- -----------
TOTAL OTHER ASSETS 6,188,502 4,542,001
----------- -----------
$19,864,605 $15,860,797
=========== ===========
</TABLE>
See notes to condensed consolidated financial statements
2
<PAGE> 3
URETHANE TECHNOLOGIES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(unaudited)
(concluded)
<TABLE>
<CAPTION>
As of
-----------------------------
March 31, December 31,
1996 1995
------------ -----------
<S> <C> <C>
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 5,982,770 $ 3,614,133
Accrued expenses 1,054,569 1,070,475
Long term debt -- current portion 52,000 52,000
Capital lease obligations -- current portion 400,388 396,774
------------- ------------
TOTAL CURRENT LIABILITIES 7,489,727 5,133,382
------------- ------------
LONG-TERM LIABILITIES:
Line of credit 3,614,079 3,291,723
Deferred tax liability 359,680 359,680
Long term debt, net of current portion 2,015,278 386,710
Capital lease obligations, net of current
portion 252,635 354,540
------------- ------------
TOTAL LONG-TERM LIABILITIES 6,241,672 4,392,653
------------- ------------
MINORITY INTEREST IN CONSOLIDATED JOINT VENTURE 657,657 678,956
------------- ------------
STOCKHOLDERS' EQUITY:
Common stock, $.01 par value; 18,000,000 shares
authorized: 10,426,379 and 10,395,610 shares
issued and outstanding, at March 31, 1996 and
December 31, 1995, respectively 104,263 103,956
Capital in excess of par value 25,665,442 25,252,270
Accumulated deficit (20,294,156) (19,700,420)
------------ ------------
TOTAL STOCKHOLDERS' EQUITY 5,475,549 5,655,806
------------ ------------
$ 19,864,605 $ 15,860,797
============ ============
</TABLE>
See notes to condensed consolidated financial statements
3
<PAGE> 4
URETHANE TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(unaudited)
<TABLE>
<CAPTION>
For the Three Months
Ended March 31,
----------------------------
1996 1995
---------- ----------
<S> <C> <C>
NET SALES $6,321,886 $5,402,961
COST OF GOODS SOLD: 5,334,851 4,180,551
---------- ----------
GROSS PROFIT 987,035 1,222,410
OPERATING EXPENSES:
Selling, general and administrative 1,119,224 894,625
Research and development 198,152 162,461
Depreciation and amortization 159,529 98,631
---------- ----------
TOTAL OPERATING EXPENSES 1,476,905 1,155,717
---------- ----------
OPERATING (LOSS) PROFIT (489,870) 66,693
---------- ----------
INTEREST EXPENSE AND OTHER:
Interest expense 138,521 101,959
Other income, net (34,655) (8,675)
---------- ----------
TOTAL INTEREST EXPENSE AND OTHER 103,866 93,284
---------- ----------
LOSS BEFORE TAX PROVISION AND
DISCONTINUED OPERATIONS (593,736) (26,591)
TAX PROVISION -- --
---------- ----------
LOSS FROM CONTINUING OPERATIONS (593,736) (26,591)
INCOME FROM DISCONTINUED OPERATIONS -- 33,762
---------- ----------
NET INCOME (LOSS) $ (593,736) $ 7,171
========== ==========
NET INCOME (LOSS) PER SHARE:
Loss from continuing operations $ (0.06) $ (0.00)
Income from discontinued operations -- 0.00
========== ==========
NET INCOME (LOSS) PER COMMON SHARE $ (0.06) $ 0.00
========== ==========
WEIGHTED AVERAGE NUMBER OF COMMON
SHARES OUTSTANDING 10,401,358 9,053,039
========== ==========
</TABLE>
See notes to condensed consolidated financial statements
4
<PAGE> 5
URETHANE TECHNOLOGIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
<TABLE>
<CAPTION>
For the Three Months
Ended March 31,
-----------------------------
1996 1995
----------- ----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 593,736 $ 7,171
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation and amortization 166,371 149,744
Minority interest in net loss of joint
venture (21,299) (9,559)
Provision for bad debts 15,000 (25,000)
Increase (decrease) from changes in:
Accounts receivable (645,959) (750,926)
Inventories (143,067) 184,669
Deposits -- (23,888)
Prepaid expenses 42,045 (30,546)
Accounts payable 837,020 755,541
Accrued expenses (19,717) (1,106,570)
----------- -----------
NET CASH USED IN OPERATING ACTIVITIES $ (363,342) $ (849,364)
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Issuance of notes receivable (145,402) (52,495)
Acquisition of property and equipment (66,438) (189,675)
Acquisition of new business (2,148,520) --
Patents and other intangible assets (9,585) (38,056)
----------- -----------
NET CASH USED IN INVESTING ACTIVITIES $(2,369,945) $ (280,226)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Net borrowings under credit line 322,356 389,996
Payments under capital leases (98,291) (82,495)
Borrowings under long term debt 1,636,520 55,000
Repayment of long term debt (13,000) (12,999)
Payment of debt issuance costs (125,868) --
Proceeds from issuance of common stock warrant 363,480 --
Proceeds from issuance of common stock -- 81,250
----------- -----------
NET CASH PROVIDED BY FINANCING ACTIVITIES $ 2,085,197 $ 430,752
----------- -----------
NET DECREASE IN CASH (648,090) (698,838)
CASH, beginning of year 908,554 1,528,380
----------- -----------
CASH, end of quarter $ 260,464 $ 829,542
=========== ===========
</TABLE>
See notes to condensed consolidated financial statements
5
<PAGE> 6
URETHANE TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
As of March 31, 1996
(1) General Information
-------------------
The condensed consolidated financial statements include the accounts
of Urethane Technologies, Inc. (the "Parent"), its 100 percent owned
subsidiaries, Polymer Development Laboratories, Inc. ("PDL") and Carousel
Group, Inc., both California corporations, BMC Acquisition, Inc., a North
Carolina corporation ("BMC"), and Carousel's 50 percent owned joint venture,
Sole Associates, J.V. ("Sole"), which is consolidated into the accompanying
financial statements, collectively referred to as the "Company." All
intercompany transactions and balances are eliminated in consolidation.
The condensed consolidated financial statements included herein have
been prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission and, in the opinion of
the Company, reflect all adjustments (consisting only of normal recurring
adjustments) and disclosures which are necessary for a fair presentation.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted pursuant to such rules and regulations. It is
suggested that these condensed financial statements be read in conjunction with
the audited financial statements and the notes thereto and management's
discussion and analysis of financial condition and results of operations
included in the Company's latest Annual Report on Form 10-K for the year ended
December 31, 1995. The results of operations for the three month period ended
March 31, 1996 are not necessarily indicative of the results for the full year.
Certain amounts in the 1995 condensed consolidated statements of
operations have been reclassified to conform to the current year presentation.
(2) Acquisition of the Assets of Brin-Mont Corporation
--------------------------------------------------
On March 15, 1996, the Company through its BMC subsidiary acquired
substantially all of the assets of Brin-Mont Corporation ("Brin-Mont") located
in Greensboro, North Carolina. Such assets consist of a manufacturing plant,
machinery and equipment, accounts receivable and other miscellaneous assets.
The Company also assumed certain liabilities of Brin-Mont, principally its
trade accounts payable.
6
<PAGE> 7
URETHANE TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
As of March 31, 1996
To acquire the assets of Brin-Mont, the Company paid cash
consideration of $2 million, and issued 30,769 shares of common stock, which
had a fair market value of approximately $50,000 as of March 15, 1996. The $2
million of cash was borrowed from a venture capital lender with an annual
interest rate of 13.5 percent. The loan is due March 16, 2001. In addition,
the Company issued to the lender a warrant to purchase, for nominal
consideration, 484,640 shares of the Company's common stock.
The acquisition has been accounted for under the purchase method of
accounting. These condensed consolidated financial statements include
preliminary allocations of the purchase price to BMC's net assets. The Company
may further adjust such allocations, and expects that any such further
adjustments will be completed within the current fiscal year.
In connection with the purchase of BMC, the Company recorded the
following:
<TABLE>
<S> <C>
Fair value of assets acquired, including goodwill $ 3,735,428
Purchase price (2,050,000)
Estimated professional fees incurred
in connection with the purchase (150,000)
-----------
Liabilities assumed $ 1,535,428
===========
</TABLE>
(3) Cash
----
Approximately $207,000 of the Company's cash balance at March 31, 1996
was attributable to Sole. The Sole joint venture agreement provides that the
Company's joint venture partner receives a preferential return of up to
$1,000,000 ($657,657 as of March 31, 1996) in any distribution upon
liquidation. Accordingly, the cash attributable to Sole was not generally
available to the Company for working capital or any other purposes.
(4) Inventories
-----------
Inventories are stated at the lower of cost (first-in, first-out) or
market, and consist principally of raw materials used in the blending of
chemicals and production of polyurethane products and finished goods.
Inventories at March 31, 1996 and December 31, 1995 are summarized as follows:
<TABLE>
<CAPTION>
March 31, 1996 December 31, 1994
-------------- -----------------
<S> <C> <C>
Raw materials $2,258,873 $1,938,612
Finished goods 1,810,946 1,628,783
---------- ----------
Total $4,069,819 $3,567,395
========== ==========
</TABLE>
7
<PAGE> 8
URETHANE TECHNOLOGIES, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
As of March 31, 1996
(5) Notes Payable -- Credit Line
----------------------------
PDL utilizes a $4,200,000 secured credit line from a finance company
to finance its working capital requirements. As of March 31, 1996, the
outstanding balance on the credit line was $3,614,079 and the amount available
to the Company on the line was $109,478. The outstanding balance on the line
bears interest at 2.5% over a floating base rate. Interest is paid monthly.
The credit line requires PDL to maintain certain financial covenants including
a total debt to net worth ratio, a minimum level of net worth and a minimum
current ratio. Under the terms of the credit line, the Company may allocate up
to $100,000 per month to PDL for general and administrative services. The
credit line restricts dividends from PDL to the Parent to no more than 25% of
PDL's earnings for the previous year. The Parent has guarantied the line of
credit, which expires in November 1997.
8
<PAGE> 9
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Results of Operations
The Company recorded a net loss in the first quarter of 1996 of
$593,736, or $0.06 per share, compared to a net profit of $7,171, or $0.00 per
share, in the first quarter of 1995. A loss was incurred notwithstanding an
increase in sales, due in part to the Company's decisions to field a larger
sales force and to increase its technical service personnel. A decrease in
gross margins, discussed below, was the other principal factor resulting in the
loss for the period.
Sales in the first quarter of 1996 were $6,321,886, an increase of
$918,925, or 17%, over sales of $5,402,961 in the first quarter of 1995.
$687,565 of the increase was from the Company's ongoing chemical systems
business and $231,360 of the increase was due to the contribution in the final
two week period in March from the Company's new BMC Acquisition, Inc. ("BMC")
subsidiary. On March 15, 1996, BMC acquired (in the "March Acquisition") a
production facility in Greensboro, North Carolina.
Cost of goods sold for the first quarter of 1996 was $5,334,851, an
increase of $1,154,300, or 27.6%, over cost of goods sold of $4,180,551 in the
first quarter of 1995. The Company's gross margin was 15.6% in the first
quarter of 1996 and 22.6% in the first quarter of 1995. The gross margin
decrease was the result of a series of raw material price increases from the
Company's vendors, which the Company was unable to pass along fully to its
customers, coupled with sales price decreases to selected customers that the
Company made due to competitive pressure. The raw material price increases
commenced in April 1995. Increased manufacturing overhead expenses in the
first quarter of 1996 also contributed to the gross margin decrease. Based on
preliminary results for April 1996, the Company expects that gross margins will
improve in the immediate future from the levels of the first quarter of 1996,
but there can be no assurance that gross margins will rebound to the level
achieved in the first quarter of the prior year.
Selling, general and administrative ("SG&A") expenses in the first
quarter of 1996 were $1,119,224, or 17.7% of sales, compared to $894,625, or
16.6% of sales, in the first quarter of 1995. The $224,599 increase in SG&A
expenses from the first quarter of 1995 to the first quarter of 1996 was due to
a $232,998 increase in the Company's sales department expenses. The bulk of
the increased sales department expenses were incurred in an expansion of the
Company's sales force in the Eastern United States. The Company expects that
the increases to the sales force will result in further sales growth in the
future.
Research and development ("R&D") expenses in the first quarter of 1996
were $198,152, or 3.1% of sales, compared to $162,461, or 3.0% of sales, in the
first quarter of 1995. The Company expects that R&D expenses will be
approximately constant, in dollar terms, for the remainder of the current year.
Depreciation and amortization expenses in the first quarter of 1996
were $159,529, an increase of $60,898, or 61.7%, over depreciation and
amortization expenses of $98,631 in the first quarter of 1995. This increase
reflects increased investment in plant and equipment.
Other expense in the first quarter of 1996 was $103,866, an increase
of $10,582, or 11.3%, over other expense of $93,284 in the first quarter of
1995. The increase was due to $17,342 of interest expense incurred by BMC in
the final two weeks of the quarter.
Overall, the Company recorded a net loss in the first quarter of 1996
of $593,736, or $0.06 per share, compared to a net profit of $7,171, or $0.00
per share, in the first quarter of 1995. Of the net loss in the 1996 quarter,
$39,738 represented the operating loss of the Company's BMC subsidiary, incurred
subsequent to the March Acquisition. The Company believes that such a rate of
loss is not indicative of results to be expected of the BMC subsidiary in the
future, and expects that the BMC subsidiary will operate on an approximately
breakeven basis for the remainder of the current year, and contribute to the
Company's overall margins by allowing the Company to purchase certain raw
materials at favorable prices. The net profit in the first quarter of 1995
included $33,762 of income from operations that were subsequently discontinued.
Excluding the income from discontinued operations, the Company recorded a net
loss of $26,591, or $0.00 per share, in the first quarter of 1995. The average
number of outstanding shares in the first quarter of 1995 was 10,401,358,
compared to 9,053,039 in the first quarter of 1995.
9
<PAGE> 10
Liquidity and Capital Resources
At March 31, 1996, the Company had working capital of $2,823,671, as
compared to working capital of $3,840,789 at December 31, 1995. Included in
working capital at March 31, 1996 and December 31, 1995 is $207,472 and
$203,304, respectively, of cash attributable to Sole, which was not generally
available to the Company for working capital or any other purposes.
The Company's operating activities used cash in the first quarter of
1996, as has been the case in the past. The Company financed its working
capital requirements in the quarter by increasing the amounts borrowed under
its revolving line of credit, and by extending the period for payment of its
accounts payable.
Operating activities used cash of $363,342 in the first quarter of
1996. The cash used in operating activities was $230,394 less than the
$593,736 net loss for the period. The primary reason for the difference
between the loss and the cash used in operating activities was $166,371 in
depreciation and amortization expenses for the period. In the first quarter of
1995, the Company used $849,364 of cash in its operating activities.
The Company used $2,369,945 of cash in its investing activities in the
first quarter of 1995. Of that amount, $2,148,520 represents cash used in the
March Acquisition. In the first quarter of 1995, the Company used $280,226 of
cash in its investing activities. The Company currently plans to invest
$300,000 to $500,000 in fixed assets and leasehold improvements over the
remainder of 1996 in order to improve its production facilities. The majority
of this investment would occur at the newly acquired BMC plant in Greensboro,
North Carolina. The Company plans to finance the production related
investments with long-term debt, by acquiring such assets under long-term
capital leases, or by a combination of such techniques.
The Company's financing activities provided $2,085,197 of cash in the
first quarter of 1996. Borrowings under long term debt and proceeds from the
issuance of warrants represented $1,874,132 of that total,net of debt issuance
costs of $125,868. The proceeds of the long term debt and capital stock
warrants issuance were used to finance the March Acquisition. The remainder of
the financing activities were $322,356 of borrowings under the Company's credit
line, which were used to finance its operating activities, and $98,291 of
payments under capital leases. In the first quarter of 1995, the Company's
financing activities provided cash of $430,752.
As a result of the foregoing, the Company had a net decrease in cash
during the first quarter of 1996 of $648,090, comparable to the net cash
decrease of $698,838 during the first quarter of 1995.
The Company has agreed in its revolving line of credit to maintain
compliance on a monthly basis with certain financial covenants. All such
covenants were met in the quarter ended March 31, 1996. Increased inventories
and concomitant increases in accounts payable and line of credit borrowings in
April 1996 may result in non-compliance with the Company's debt-to-net-worth
covenant as of April 30, 1996. Although the Company believes (based on
preliminary discussions with its lender) that such noncompliance will be
waived, the Company may incur increased costs under its credit line. It is
also possible that the Company and the lender may fail to reach agreement, and
that the Company could be required to seek alternate financing arrangements for
its working capital needs. The Company has not specifically identified such
alternate arrangements, as it believes such an outcome to be unlikely.
The Company also has agreements with the lender that provided the debt
financing for the March Acquisition, which require, inter alia, that the
Company merge its BMC and PDL subsidiaries not later than January 1, 1997.
Such a merger would require the consent of the lender under the Company's line
of credit. The Company has requested such consent, and discussions are
continuing as of the date of this report. If such consent is not granted,
which is an issue the Company expects to resolve within the quarter ending June
30, 1996, the Company would be required to replace either its line of credit or
the debt financing for the March acquisition. The Company would address those
alternatives if consent is not obtained within that time frame.
The Company anticipates, based on currently proposed plans and
assumptions relating to its operations, that its current working capital,
together with projected revenue from operations, will satisfy the Company's
contemplated cash requirements for at least 12 months following the date of
this report.
10
<PAGE> 11
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) The following exhibits are filed herewith:
11. Statement re Computation of Per Share Earnings
27. Financial Data Schedule
(b) During the quarter ended March 31, 1996, the registrant filed
one report on Form 8-K, dated March 15, 1996. Such report
disclosed the acquisition of assets in Item 2 thereof.
Financial statements relating to the business in which such
assets have been used will be filed within 75 days after
March 15, 1996.
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) 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: May 15, 1996
URETHANE TECHNOLOGIES, INC.
By: /s/ JAMES B. FRAKES
-------------------------------
James B. Frakes
Vice President
Chief Financial Officer
11
<PAGE> 1
EXHIBIT 11
URETHANE TECHNOLOGIES, INC.
STATEMENT RE COMPUTATION OF PER SHARE EARNINGS
The computation of net loss per share for the quarter ended March 31, 1996
is as follows:
<TABLE>
<CAPTION>
<S> <C>
PRIMARY:
Net Loss $ (593,736)
===========
Weighted average number of common shares outstanding 10,401,358
Dilutive common stock equivalents outstanding --
-----------
Average number of common shares outstanding on a
primary basis 10,401,358
===========
Net loss per share $ (0.06)
===========
FULLY DILUTED:
Net loss $ (593,736)
===========
Weighted average number of common shares outstanding 10,401,358
Dilutive common equivalent shares outstanding --
-----------
Average number of common shares outstanding
on a fully diluted basis 10,401,358
===========
Net loss per share on a fully diluted basis $ (0.06)
===========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 260,464
<SECURITIES> 0
<RECEIVABLES> 5,835,634
<ALLOWANCES> 229,710
<INVENTORY> 4,069,819
<CURRENT-ASSETS> 10,313,398
<PP&E> 5,280,898
<DEPRECIATION> 1,918,193
<TOTAL-ASSETS> 19,864,605
<CURRENT-LIABILITIES> 7,489,727
<BONDS> 0
0
0
<COMMON> 104,263
<OTHER-SE> 5,371,286
<TOTAL-LIABILITY-AND-EQUITY> 19,864,605
<SALES> 6,321,886
<TOTAL-REVENUES> 6,321,886
<CGS> 5,334,851
<TOTAL-COSTS> 6,811,756
<OTHER-EXPENSES> 103,866
<LOSS-PROVISION> 15,000
<INTEREST-EXPENSE> 138,521
<INCOME-PRETAX> (593,736)
<INCOME-TAX> 0
<INCOME-CONTINUING> (593,736)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (593,736)
<EPS-PRIMARY> (0.06)
<EPS-DILUTED> (0.06)
</TABLE>
