SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934 UNDER SECTION 13 OR 15(d) Of
THE SECURITIES EXHANGE ACT OF 1934
For the quarterly period ended September 30, 1998
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15 (d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____________ to _____________.
Commission File Number 000-18887
COLONIAL TRUST COMPANY
(Exact name of registrant as specified in its charter)
Arizona 75-2294862
(State of Incorporation) (IRS Employer Identification Number)
5336 N. 19th Avenue
Phoenix, Arizona 85015
(Address of principal executive offices)
602-242-5507
(Registrant's telephone number)
<PAGE>
NONE
(Former name, address and fiscal year, if changed since last report)
Check whether the issuer (1) filed all reports required to be filed
by Section 13 or 15 (d) of the Exchange Act during the 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
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE
PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to
be filed by Section 12, 13 or 15 (d) of the Exchange Act after the
distribution of securities under a plan confirmed by court.
Yes No
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of
common equity, as of the last practicable date: 768,447
Transitional Small Business Disclosure Format (check one):
Yes No X
<PAGE>
COLONIAL TRUST COMPANY
INDEX
Part I. Financial Information: page
Item 1: Financial Statements 4
Condensed Balance Sheets 4
Condensed Statements of Earnings 5
Condensed Statements of Cash Flows 6
Notes to Condensed Financial Statements 7
Item 2: Management's Discussion and Analysis or
Plan of Operation 11
Part II. Other Information
Item 1: Legal Proceedings 16
Item 2: Changes in Securities 16
Item 3: Default Upon Senior Securities 16
Item 4: Submission of Matters to a Vote of
Security Holders 16
Item 5: Other Information 16
Item 6: Exhibits and Reports on Form 8-K 17
SIGNATURES
<PAGE>
COLONIAL TRUST COMPANY
PART 1. FINANCIAL INFORMATION
Item 1. Financial Statements
Condensed Balance Sheets (Unaudited)
September 30, 1998 and March 31, 1998
ASSETS September 30, 1998 March 31, 1998
Cash and cash equivalents $11,529 $28,475
Receivables 487,716 390,758
Note receivable 404,576 389,489
Property, furniture and
equipment, net 755,198 712,482
Excess of cost over fair
value acquired, net 147,335 153,420
Other assets 137,800 105,449
Restricted cash 173,074 168,206
$2,117,228 $1,948,279
LIABILITIES AND STOCKHOLDERS' EQUITY
Accounts payable and
accrued liabilities $146,992 $132,375
Income tax payable 59,317 47,605
Deferred income taxes 11,830 11,830
Total Liabilities 218,139 191,810
Stockholders' equity:
Common stock, no par value;
25,000,000 shares authorized,
768,683 issued and 757,966
outstanding, at September 30, 1998
and 772,929 issued and
outstanding at March 31, 1998 555,177 554,942
Additional paid-in capital 505,347 505,347
Retained earnings 870,715 696,180
Treasury stock ,
10,717 shares at cost (32,150) 0
Total stockholders' equity 1,899,089 1,756,469
$2,117,228 $1,948,279
See accompanying notes to condensed financial statements.
<PAGE>
COLONIAL TRUST COMPANY
Condensed Statements of Earnings (Unaudited)
Three-month periods Six-month periods
ended September 30, ended September 30,
Revenues: 1998 1997 1998 1997
Bond servicing
income $486,317 $419,053 $938,379 $784,522
IRA servicing
fees-corporate 88,451 78,827 192,888 191,228
IRA servicing
fees-personal trust 27,954 17,203 56,359 37,364
Trust fee income 129,284 74,036 216,176 133,243
Interest income 11,716 9,503 23,435 19,073
Total revenue 743,722 598,622 1,427,237 1,165,430
General and
administrative
expenses 585,505 485,084 1,111,487 992,425
Earnings before
income taxes 158,217 113,538 315,750 173,005
Income taxes 64,396 45,993 128,193 70,077
Net earnings $93,821 $67,545 $187,557 $102,928
Basic net
earnings per
common share $.12 $.09 $.24 $.13
Diluted net
earnings per
common share $.12 $.09 $.24 $.13
Weighted average
shares outstanding
- basic 762,338 777,740 767,331 777,740
Weighted average
shares outstanding
- diluted 775,973 793,777 780,967 793,777
See accompanying notes to condensed financial statements.
<PAGE>
COLONIAL TRUST COMPANY
Condensed Statements of Cash Flows (Unaudited)
Six-month periods ended
September30,
1998 1997
Cash flows from
operating activities:
Net earnings $187,557 $102,928
Adjustments to reconcile net earnings to
net cash provided by operating activities:
Depreciation and amoritization 44,150 41,630
Increase in receivables (96,958) (138,772)
Increase in other assets (32,351) (8,590)
Increase in accounts payable and
accrued liabilities 14,617 3,176
Increase in income tax payable 11,712 23,470
Net cash provided by operating
activities 128,727 23,842
Cash flows from investing activities:
Purchase of property,
furniture and equipment (80,781) (22,739)
Additions to note receivable (15,087) (13,986)
Increase in restricted cash (4,868) 0
Net cash used in investing
activities (100,736) (36,725)
Cash flows from financing
activities:
Proceeds from sale of common stock 235 0
Purchase and retirement of
common stock (13,022) 0
Purchase of treasury stock (32,150) 0
Net cash used in financing
activities (44,937) 0
Decrease in cash and
cash equivalents (16,946) (12,883)
Cash and cash equivalents
at beginning of period 28,475 132,426
Cash and cash equivalents
at end of period $11,529 $119,543
See accompanying notes to condensed financial statements.
<PAGE>
COLONIAL TRUST COMPANY
Notes to Condensed Financial Statements
Significant Accounting Policies
In the opinion of Colonial Trust Company (the "Company"), the
accompanying unaudited condensed financial statements contain all
adjustments necessary to present fairly the financial
position, the results of operations and cash flows for the periods
presented. The accompanying statements do not include all disclosures
considered necessary for a fair presentation in conformity with generally
accepted accounting principles. Therefore, it is recommended that these
accompanying statements be read in conjunction with the financial
statements appearing in the Company's 1998 Annual Report on Form 10-KSB.
Nature of Business
The Company was incorporated on August 15, 1989, in the State of Arizona for
the purpose of engaging in the business of acting as a fiduciary. The
Company is domiciled in the State of Arizona and is regulated by the Arizona
State Banking Department. Its Common Stock is registered under the
Securities Exchange Act of 1934.
The Company serves as trustee under various bond indentures for issuers of
bonds in 39 states. The issuers are primarily churches and other non-profit
organizations. As trustee, the Company receives, holds, invests and
disburses the bond proceeds as directed by the applicable trust indenture
and receives weekly or monthly sinking fund payments from the issuer of
bonds, and, as paying agent, pays the semi-annual principal and interest
payments to the bondholders.
The Company also serves as trustee of self-directed individual retirement
accounts for certain bondholders or employees of religious organizations.
On November 1, 1995, the Company purchased all of the issued and outstanding
capital stock of Camelback Trust Company ("Camelback"). Effective on
August 1, 1996, Camelback was merged with and into the Company, the Company
continued as the surviving corporation, and the separate existence of
Camelback terminated effective as of such date. Camelback now operates as
the Company's "Personal Trust Division." The Personal Trust division
provides investment management administration and custodial services for
customers with various securities held in trust or in investment agency
accounts.
<PAGE>
COLONIAL TRUST COMPANY
Notes to Condensed Financial Statements
(b) Revenue Recognition
The Company is compensated for its services as trustee and paying
agent in one of three ways. The first fee structure allows the Company to
invest trust funds held for disbursement and retain the gains and earnings
therefrom. The second fee structure requires the issuing institution
to pay a percentage of the bond proceeds to the Company for set-up and
bond printing costs during the first year. Additionally, an
annual maintenance fee is required each year. The third fee structure
entitles the Company to interest earnings up to 2.5% of daily trust funds
held in bond program fund accounts in lieu of a set-up fee. Annual
maintenance fees and bond printing costs are charged as a percentage of the
related bond issue. The Company's policy is to allow the non-profit issuer
to choose between the three fee structures. The Company believes that
the third fee structure is currently utilized by a majority of the
Company's competitors.
The Company also receives fees for services provided as custodian for
self-directed individual retirement accounts. For its services as trustee,
the Company receives an annual base fee of $40 and a transaction fee of $5
per transaction for each transaction in excess of 12 per year. The Company
also retains, as a portion of its fee, earnings of 2% on the daily
uninvested balance in each IRA account.
The Company's Personal Trust Division generates revenues based on two fee
structures. The first structure represents a percentage of the
fiduciary assets, which
are held as trustee or agent. Fees are assessed on a quarterly basis to
individual accounts according to the fair market value of the supporting
fiduciary assets in such account at the end of each quarter.
Under the second fee structure, the Company charges an annual fee which
is set up to cover the maintenance of fiduciary assets which the Company
holds in both trust and self-directed IRA accounts.
(c) Computation of Basic and Diluted Net Earnings Per Common Share
Basic earnings per share is computed based on weighted average shares
outstanding and excludes any potential dilution from stock options,
warrants and other common stock equivalents. Diluted EPS reflects
potential dilution from the exercise or conversion of securities
into common stock or from other contracts to issue common
stock.
<PAGE>
COLONIAL TRUST COMPANY
Notes to Condensed Financial Statements
(d) Reclassifications
Certain reclassifications have been made to prior year balances to conform
to the current year presentation.
Note Receivable
On December 1, 1990, the Company entered into a Master Note and Letter
Agreement with
Church Loans and Investment Trust, Inc., its former parent corporation.
The Master Note, in the maximum amount of $1,000,000, is due on demand,
bears interest payable monthly at 1% less than the prime rate and is
unsecured. Amounts advanced from time to time may be prepaid and
reborrowed.
Lease Commitments
The Company was party to an office lease for commercial office space
formerly occupied by Camelback as its executive office. This office lease
terminated on February 14, 1998. During the six-month period ended
September 30, 1998, the Company no longer leased office space.
<PAGE>
COLONIAL TRUST COMPANY
Notes to Condensed Financial Statements
Earnings Per Share
A reconciliation from basic earnings per share to diluted earnings per
share for the periods ended September 30, 1998, and September 30, 1997,
follows:
Three-month periods Six-month periods
ended September 30, ended September 30,
1998 1997 1998 1997
Net earnings $93,821 $67,545 $187,557 $102,928
Basis EPS
-weighted average
shares outstanding 762,338 777,740 767,331 777,740
Basic EPS $.12 $.09 $.24 $.13
Basic EPS
-weighted average
shares outstanding 762,338 777,740 767,331 777,740
Effect of
dilutive securities:
stock options 13,635 16,037 13,636 16,037
Diluted EPS
-weighted average
shares outstanding 775,973 793,777 780,967 793,777
Diluted EPS $.12 $.09 $.24 $.13
On September 24, 1998, the Company's shareholders approved a one-for-ten
reverse common stock split. Weighted average shares outstanding and basic
and diluted earnings per share for all periods presented have been adjusted
to reflect this reverse common stock split.
<PAGE>
COLONIAL TRUST COMPANY
Notes to Condensed Financial Statements
"Safe Harbor" Statement under the Private Securities Litigation Reform Act
of 1995:
This Form 10-QSB may contain one or more forward-looking statements within
the meaning of Section 21E of the Securities Exchange Act of 1934, as
amended, and is subject to the safe harbors created thereby. These
forward-looking statements involve risks and uncertainties,
including, but not limited to: the Company's continued employment of key
management, including John Johnson, the Company's Chief Executive Officer;
Marv Hoeflinger, the Company's Vice President of Business Development;
Bud Olson, the Company's Vice President of Business Development Personal
Trust business; and Christopher J. Olson, the Company's Vice President and
senior officer responsible for the Company's Personal Trust Business;
the success of Messrs. Johnson, Hoeflinger and Bud Olson in their
business development efforts on behalf of the Company; the Company's success
in being repaid on the bonds it purchases or the loans it makes under the
Bond Repurchase Program; the continuation of the Company's investment
advisory agreement with Hackett Investment Advisors ("HIA"), pursuant to
which HIA provides investment advisory services for the majority of the
trust and investment agency accounts of the Company, and the success of HIA
in managing such accounts; increased competition for the Company's services;
competitive pressures on prices for the Company's services; Year 2000
issues; increased staffing or office needs not currently anticipated; new
rules or regulations not currently anticipated which adversely affect the
Company; and an increase in interest rates or other economic factors
having an adverse impact on the Company and other risks detailed from time
to time in the Company's Securities and Exchange Commission filings. The
Company filed its fiscal 1998 form 10-KSB on June 29, 1998. Please refer to
this document for a more detailed discussion of the risks and uncertainties
associated with the Company's future operations.
Item 2. Management's Discussion and Analysis or Plan of Operation
Results of Operations Three-month Period Ended September 30, 1998
The Company reported an increase in net earnings for the three-month period
ended September 30,
1998, compared to the comparable prior period. The Company had net earnings
of $93,821, or $.12
per share, for the three-month period ended September 30, 1998, compared to
net earnings of
$67,545, or $.09 per share, for the three-month period ended September 30,
1997, an increase of 39%. The Company had total revenue of $743,722 for the
three-month period ended September 30, 1998, compared to total revenue of
$598,622 for the three-month period ended September 30, 1997, an increase
of 24%.
The Company's bond servicing income increased to $486,317 for the three-month
period ended September 30, 1998, compared to $419,053 for the three-month
period ended September 30,
<PAGE>
1997, an increase of 16%. The increase was primarily attributable to an
increase in the number of bond issues for which the Company serves as Trustee
and Paying Agent. As of September 30, 1998, the Company was serving as
trustee for the benefit of bondholders on 432 bond offerings totaling
approximately $353,000,000 in original principal amount; as of September 30,
1997, the Company was serving as trustee for the benefit of bondholders on
338 bond offerings totaling approximately $304,000,000 in original
principal amount. The increase in new bond offerings is due to the new
business development efforts of the Company, including, but not limited to,
the efforts of Marv Hoeflinger, the Company's Vice President of Business
Development, who joined the Company in February 1996.
Income from IRA Accounts increased to $116,405 for the three-month period
ended September 30, 1998, compared to $96,030 for the three-month period
ended September 30, 1997, an increase of 21%. The increase was due primarily
to an increase in the number of IRA Accounts serviced by the
Company. IRA Accounts are serviced by both the Corporate Trust Division and
the Personal Trust Division of the Company. As of September 30, 1998, the
Company served as trustee for approximately 7,550 self-directed Individual
Retirement Accounts with total assets of approximately
$155,000,000; as of September 30, 1997, the Company served as trustees for
6,900 self-directed Individual Retirement Accounts with total assets of
approximately $134,000,000.
Trust fee income increased to $129,284 for the three-month period ended
September 30, 1998, compared to $74,036 for the three-month period ended
September 30, 1997, an increase of 75%. The increase was due to an
increase in the number of accounts for which the Company serves as trustee
or agent.
Interest income increased to $11,716 for the three-month period ended
September 30, 1998,compared to $9,503 for the three-month period ended
September 30, 1997, an increase of 23%. The increase was primarily
attributable to an increase in the note receivable balance due to reinvestment
of earned income.
The Company's general and administrative expenses increased to $585,505 for
the three-month period ended September 30, 1998, compared to $485,084 for the
three-month period ended September 30, 1997, an increase of 21%. The
increase was due primarily to the addition of several staff members, as
well as other additional expenses involved in administering the Company's
increased bond servicing, IRA and personal trust business. The Company's
general and administrative expenses decreased as a percentage of the
Company's total revenues to 79% for the three-month period September 30,
1998, compared to 81% for the comparable prior period. The foregoing
decreases reflect the Company's ability to spread its general and
administrative expenses over an expanding revenue base.
The Company's effective income tax rate was 40.7% for the three-month period
ended September 30, 1998, and 40.5% for the three-month period ended
September 30, 1997.
<PAGE>
Results of Operations Six-month Period Ended September 30, 1998
The Company reported an increase in net earnings for the six-month period
ended September 30,
1998, compared to the comparable prior period. The Company had net earnings
of $187,557, or $.24
per share, for the six-month period ended September 30, 1998, compared to net
earnings of
$102,928, or $.13 per share, for the six-month period ended September 30,
1997, an increase of 82%.
The Company had total revenue of $1,427,237 for the six-month period ended
September 30, 1998,
compared to total revenue of $1,165,430 for the six-month period ended
September 30, 1997, an increase of 22%.
The Company's bond servicing income increased to $938,379 for the six-month
period ended
September 30, 1998, compared to $784,522 for the six-month period ended
September 30, 1997; an increase of 20%. The increase was primarily
attributable to an increase in the number of bond issues
for which the Company serves as Trustee and Paying Agent and, to a lesser
extent, a one-time collection of approximately $45,000 in outstanding fees
related to a settlement of a bankruptcy estate.
Income from IRA Accounts increased to $249,247 for the six-month period
ended September 30, 1998, compared to $228,592 for the six-month period
ended September 30, 1997, an increase of 9%. The increase was due
primarily to an increase in the number of IRA Accounts serviced by the
Company.
Trust fee income increased to $216,176 for the six-month period ended
September 30, 1998, compared to $133,243 for the six-month period ended
September 30, 1997, an increase of 62%. The increase was due to an
increase in the number of accounts for which the Company serves as trustee
or agent.
Interest income increased to $23,435 for the six-month period ended
September 30, 1998, compared to $19,073 for the six-month period ended
September 30, 1997, an increase of 23%. The increase was primarily
attributable to an increase in the note receivable balance due to
reinvestment of earned income.
The Company's general and administrative expenses increased to $1,111,487
for the six-month period ended September 30, 1998, compared to $992,425 for
the six-month period ended September 30, 1997, an increase of 12%. The
increase was due primarily to the addition of several staff members,
as well as other additional expenses involved in administering the Company's
increased bond servicing, IRA and personal trust business. For the
six-month period ended September 30, 1997, the Company incurred an expense
of approximately $54,500 in connection with the termination in June
1997 of its proposed private placement of Common Stock. Such expenses were
for legal, accounting, and investment banking fees incurred (and previously
accrued by the Company) in connection with such private placement. The
Company sold no securities in the private placement. The Company's
general and administrative expenses decreased as a percentage of the
Company's total revenues to 78% for the six-month period September 30, 1998,
compared to 85% for the comparable prior period. The foregoing decreases
<PAGE>
reflect the Company's ability to spread its general and administrative
expenses over an expanding revenue base.
The Company's effective income tax rate was 40.6% for the six-month
period ended September 30, 1998, and 40.5% for the six-month period ended
September 30, 1997.
Year 2000
The Company recognizes the potential business impacts related to the Year
2000 computer system issue and is implementing a plan to assess and improve
the Company's state of readiness with respect to such issues. The Year 2000
issue is one where computer systems may recognize the designation
"00" as 1900 when it means 2000, resulting in system failure or
miscalculations.
Commencing in 1997, the Company initiated a comprehensive review of its core
information technology systems, which the Company is dependent upon for the
conduct of day to day business operations, in order to determine the
adequacy of those systems in light of future business requirements.
Year 2000 readiness was one of a variety of factors to be considered in the
review of core systems.
In recognition of the Year 2000 issue, in September 1997, the Company began
a comprehensive review of all information technology and non-information
technology systems used by the Company, computer hardware and software
products supplied to broker-dealers by the Company, and computer
hardware and software products and components and other equipment supplied to
the Company by third parties. Such review includes testing and analysis of
Company systems and inquiries of third parties supplying information
technology and non-information technology systems, computer
hardware and software products and components, and other equipment to the
Company.
The Company has divided its Year 2000 review into two phases. The first
addresses the Company's core information technology systems. The second
phase addresses non-core information technolog systems, non-information
technology systems, and products, components and equipment supplied to
the Company from third parties. In addition, the Company will implement
required Year 2000 upgrades and replacements during the second phase.
The Company substantially completed the first phase of its review in
June 1998. The Company believes it will complete the second phase by March
1999.
In the first phase of its Year 2000 review, the Company tested all software
products currently provided to broker-dealers, and determined that such
products are Year 2000 compliant. The Company also made inquiries of all
third parties supplying the Company with computer hardware and software
products and received assurances that such products and components are Year
2000 compliant. With respect to core information technology, the Company
made inquiries of third parties supplying computer hardware and software
operating systems to the Company, and received assurances that such
hardware and software systems are Year 2000 compliant.
<PAGE>
The Company has not developed a "worst case" scenario with respect to Year
2000 issues, but instead has focused its resources on identifying material,
remediable problems and reducing uncertainties generally, through the Year
2000 review described above.
At this time, the Company has not developed Year 2000 contingency plans,
other than the review and remedial actions described above, and does not
intend to do so unless the Company believes such plans are merited by the
results of its continuing Year 2000 review. The Company maintains and
deploys contingency plans designed to address various other potential
business interruptions. These plans may be applicable to address the
interruption of support provided by third parties resulting from
their failure to be Year 2000 ready.
If the Company or the third parties with which it has relationships were to
cease or not successfully complete its or their Year 2000 remediation
efforts, the Company would encounter disruptions to its
business that could have a material adverse effect on its business, financial
position and results of operations. The Company could be materially and
adversely impacted by widespread economic or financial market disruption
or by Year 2000 computer system failures at third parties with which it
has relationships.
"Safe Harbor" Statement under the Private Securities Litigation Reform Act
of 1995
This Form 10-Q may contain forward-looking statements that involve risks
and uncertainties, including, but not limited to, the impact of competitive
products and pricing, product demand and market acceptance risks, the
presence of competitors with greater financial resources, product
development and commercialization risks, costs associated with the
integration and administration of acquired operations, capacity and supply
constraints or difficulties, the results of financing efforts,
Year 2000 issues and other risks detailed from time to time in the
Company's Securities and Exchange Commission filings. The Company filed its
fiscal 1998 Form 10K on June 29, 1998. Please refer to this document
for a more detailed discussion of the risks and uncertainties associated
with the Company's future operations.
Liquidity and Capital Resources
Under legislation effective on July 20, 1996, the Company is required to
maintain net capital of at least $500,000; the Company's net capital
was $1,895,673 on September 30, 1998. The legislation also requires that
the Company's net capital meet certain liquidity requirements.
Specifically, $166,666, $333,332 and $500,000 of such net capital must
meet the Department's liquidity requirements by December 31, 1997, December
31, 1998, and December 31, 1999, respectively. At September 30, 1998,
$173,074 of the Company's net capital met the Department's liquidity
requirements. The Company believes that it will be able to satisfy the
foregoing liquidity requirements from cash on hand and other assets of the
Company. Net cash provided by operating activities was $128,717 for the
period ended September 30, 1998. The Company also believes that
it will be able to satisfy its working capital and capital expenditure
requirements for the foreseeable future from existing cash balances, from
anticipated cash flow from operating activities, and from funds available
under the Company's Master Note with its former parent, Church Loans and
Investments Trust.
<PAGE>
The Company's cash and cash equivalents decreased from $28,475 on March 31,
1998, to $11,529 on September 30, 1998, while the note receivable
increased from $389,489 on March 31, 1998, to $404,576 on September 30,
1998. The decrease in cash and cash equivalents was primarily due to
the purchase of additional furniture, equipment and computer hardware.
The increase in the not receivable was due to the reinvestment of interest
earned on the note receivable. The Company's gross property and equipment
increased from $1,008,938 on March 31, 1998, to $1,089,720 on
September 30, 1998. The increase was primarily due to the purchase of
additional furniture, equipment and computer software for new employees.
PART II. OTHER INFORMATION
Item 1: Legal Proceedings
None.
Item 2: Changes in Securities
None.
Item 3: Default Upon Senior Securities
None.
Item 4: Submission of Matters to a Vote of Security Holders
On September 24, 1998, the Company held its Annual
Meeting of Shareholders
(the "Annual Meeting"). The following sets forth the
matters voted upon at the
Annual Meeting, as well as the number of votes cast for,
against or withheld on such matters:
1-for-10 reverse stock split:
Votes for Votes Against
4,057,746 564,102
2-Election of Directors:
Votes for Votes Against
Lynn R. Camp 4,551,599 40,531
Gerald G. Morgan, Jr. 4.562,913 29,217
Michael W. Borger 4,670,471 40,531
John K. Johnson 4,562,609 29,521
<PAGE>
Item 5: Other Information
None.
Item 6: Exhibits and Reports on Form 8-K:
Exhibits: None.
Reports on Form 8-K: None.
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
COLONIAL TRUST COMPANY
DATE: November 13, 1998 BY: John K. Johnson
John K. Johnson
Its: President
DATE: November 13, 1998 BY: Christopher J. Olson
Christopher J. Olson
Its: Chief Financial Officer
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-1998
<PERIOD-START> APR-01-1998
<PERIOD-END> SEP-30-1998
<CASH> 11,529
<SECURITIES> 0
<RECEIVABLES> 892,292
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,076,895
<PP&E> 1,089,720
<DEPRECIATION> (334,522)
<TOTAL-ASSETS> 2,117,228
<CURRENT-LIABILITIES> 218,139
<BONDS> 0
0
0
<COMMON> 555,177
<OTHER-SE> 1,283,912
<TOTAL-LIABILITY-AND-EQUITY> 2,117,228
<SALES> 1,427,237
<TOTAL-REVENUES> 1,427,237
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,111,487
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 315,750
<INCOME-TAX> 128,193
<INCOME-CONTINUING> 187,557
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 187,557
<EPS-PRIMARY> .01
<EPS-DILUTED> .01
</TABLE>
