<PAGE> 1
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter Ended Commission File
December 31, 1998 Number 1-3552
----------------- -------------
SCOPE INDUSTRIES
(Exact name of Registrant as specified in its charter)
California 95-1240976
- ------------------------------- ----------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
233 Wilshire Blvd., Ste.310, Santa Monica, CA 90401
(Address of principal executive office) (ZIP Code)
Registrant's telephone number, including area code (310) 458-1574
--------------
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.
<TABLE>
<S> <C>
Class Outstanding at January 25, 1999
- -------------------------- -------------------------------
Common Stock, no par value 1,116,367
</TABLE>
<PAGE> 2
SCOPE INDUSTRIES AND SUBSIDIARIES
INDEX
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Part I. Financial Information:
Consolidated Balance Sheets -
December 31, 1998 and June 30, 1998 3
Consolidated Statements of Operations -
Three Months Ended
December 31, 1998 and 1997 4
Consolidated Statements of Operations -
Six Months Ended
December 31, 1998 and 1997 5
Consolidated Statements of Cash Flows -
Six Months Ended
December 31, 1998 and 1997 6
Notes to Consolidated Financial Statements 7
Management's Discussion and Analysis of
Results of Operations and
Financial Condition 9
Part II. Other Information:
Item 2. Increases and Decreases in
Outstanding Securities and
Indebtedness 11
Item 5. Other Information 12
Item 6. Exhibits and Reports on Form 8-K 12
Signatures 12
</TABLE>
-2-
<PAGE> 3
PART I. FINANCIAL INFORMATION
SCOPE INDUSTRIES AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
DECEMBER 31 JUNE 30
1998 1998
----------- -----------
(UNAUDITED)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 1,040,345 $ 755,904
Treasury bills available for sale-at
fair value 41,013,273 43,024,640
Accounts and notes receivable, less allowance
for doubtful accounts of $194,814 at December
31, 1998 and $205,318 at June 30, 1998 1,445,400 1,618,150
Inventories 569,994 662,399
Deferred income taxes 710,000 700,000
Prepaid expenses and other current assets 1,145,358 459,465
----------- -----------
TOTAL CURRENT ASSETS 45,924,370 47,220,558
----------- -----------
NOTES RECEIVABLE 1,046,518 897,829
----------- -----------
PROPERTY AND EQUIPMENT:
Machinery and equipment 24,148,047 23,407,396
Land, buildings and improvements 10,580,292 10,581,881
----------- -----------
34,728,339 33,989,277
Less accumulated depreciation and amortization 24,109,850 23,304,941
----------- -----------
10,618,489 10,684,336
----------- -----------
OTHER ASSETS:
Deferred charges and other assets 471,122 244,590
Investments available for sale-at fair value 13,523,332 17,326,799
Other equity investments-at cost 2,006,002 2,006,002
----------- -----------
16,000,456 19,577,391
----------- -----------
$73,589,833 $78,380,114
=========== ===========
LIABILITIES AND SHAREOWNERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 956,525 $ 1,050,796
Other accrued liabilities 2,482,718 1,359,136
Accrued payroll and related employee benefits 523,861 705,604
Income taxes payable 187,431 475,506
----------- -----------
TOTAL CURRENT LIABILITIES 4,150,535 3,591,042
----------- -----------
DEFERRED INCOME TAXES 2,285,000 3,635,000
----------- -----------
6,435,535 7,226,042
----------- -----------
SHAREOWNERS' EQUITY:
Common stock, no par value, 5,000,000 shares
authorized; shares issued and outstanding
December 31, 1998 1,116,367
June 30, 1998 1,122,842 4,161,300 4,138,462
Retained earnings 55,777,650 57,635,588
Net unrealized gain on investments 7,215,348 9,380,022
----------- -----------
67,154,298 71,154,072
----------- -----------
$73,589,833 $78,380,114
=========== ===========
</TABLE>
The accompanying notes are an integral part of these statements.
-3-
<PAGE> 4
SCOPE INDUSTRIES AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
DECEMBER 31
----------------------------
1998 1997
----------- -----------
<S> <C> <C>
REVENUES:
Sales $ 3,964,808 $ 5,708,983
Vocational school revenues 1,178,696 1,155,933
----------- -----------
5,143,504 6,864,916
----------- -----------
OPERATING COSTS AND EXPENSES:
Cost of sales 3,693,832 3,976,905
Vocational school expenses 899,990 884,509
Depreciation and amortization 520,522 516,119
General and administrative 960,053 979,808
----------- -----------
6,074,397 6,357,341
----------- -----------
(930,893) 507,575
Investment and other income 607,809 4,584,245
----------- -----------
Income (loss) before income taxes (323,084) 5,091,820
Provision (benefit) for income taxes (85,000) 1,890,000
----------- -----------
NET INCOME (LOSS) $ (238,084) $ 3,201,820
=========== ===========
NET INCOME (LOSS) PER SHARE - BASIC $ (0.21) $ 2.82
NET INCOME (LOSS) PER SHARE - DILUTED $ (0.21) $ 2.80
Average shares outstanding - Basic 1,117,242 1,134,102
Dilutive effect of stock options 9,391 9,508
----------- -----------
Average shares outstanding - Diluted 1,126,633 1,143,610
Cash dividends declared per share $ 1.00 $ 1.00
</TABLE>
The accompanying notes are an integral part of these statements.
-4-
<PAGE> 5
SCOPE INDUSTRIES AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
DECEMBER 31
------------------------------
1998 1997
------------ ------------
<S> <C> <C>
REVENUES:
Sales $ 7,991,983 $ 11,066,547
Vocational school revenues 2,302,901 2,293,174
------------ ------------
10,294,884 13,359,721
------------ ------------
OPERATING COSTS AND EXPENSES:
Cost of sales 7,131,422 7,664,550
Vocational school expenses 1,797,463 1,785,669
Depreciation and amortization 1,030,589 1,035,696
General and administrative 1,901,013 2,066,283
------------ ------------
11,860,487 12,552,198
------------ ------------
(1,565,603) 807,523
Investment and other income 1,292,171 5,014,112
------------ ------------
Income (loss) before income taxes (273,432) 5,821,635
Provision (benefit) for income taxes (40,000) 2,205,000
------------ ------------
NET INCOME (LOSS) $ (233,432) $ 3,616,635
============ ============
NET INCOME (LOSS) PER SHARE - BASIC $ (0.21) $ 3.15
NET INCOME (LOSS) PER SHARE - DILUTED $ (0.21) $ 3.12
Average shares outstanding - Basic 1,118,763 1,148,915
Dilutive effect of stock options 9,610 8,973
------------ ------------
Average shares outstanding - Diluted 1,128,373 1,157,888
Cash dividends declared per share $ 1.00 $ 1.00
</TABLE>
The accompanying notes are an integral part of these statements.
-5-
<PAGE> 6
SCOPE INDUSTRIES AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
SIX MONTHS ENDED
DECEMBER 31
------------------------------
1998 1997
------------ ------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (233,432) $ 3,616,635
Adjustments to reconcile net income (loss) to net
cash flows from operating activities:
Depreciation and amortization 1,030,589 1,035,696
Gains on investments available for sale (10,258) (4,128,161)
(Gains) losses on sale of equipment (45,534) 18,435
Deferred income taxes (145,000) (120,000)
Changes in operating assets and liabilities:
Accounts and notes receivable 179,061 (272,493)
Inventories 92,405 166,412
Prepaid expenses and other current assets (685,893) (218,942)
Accounts payable and accrued liabilities 847,568 758,166
Income taxes payable (288,075) (35,963)
Other assets (6,532) 4,423
------------ ------------
Net cash flows from operating activities 734,899 824,208
------------ ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of U.S. Treasury bills (16,988,633) (22,872,420)
Maturities of U.S. Treasury bills 19,000,000 18,750,000
Purchase of property and equipment (1,112,700) (632,038)
Disposition of property and equipment 193,492 53,409
Purchase of long-term notes receivable (340,000) (658,800)
Purchase of investments available for sale (319,049) (335,703)
Purchase of other equity investments (1,001,000)
Proceeds from sale of investments available for sale 718,100 4,979,967
------------ ------------
Net cash flows from (used in) investing activities 1,151,210 (1,716,585)
------------ ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Dividends to shareowners (1,117,967) (1,133,352)
Repurchases of common stock (506,539) (1,857,602)
Proceeds from stock options exercised 22,838
Change in bank overdraft 66,896
------------ ------------
Net cash used in financing activities (1,601,668) (2,924,058)
------------ ------------
Net change in cash and cash equivalents 284,441 (3,816,435)
Cash and cash equivalents at beginning
of period 755,904 5,946,050
------------ ------------
Cash and cash equivalents at end of period $ 1,040,345 $ 2,129,615
============ ============
</TABLE>
The accompanying notes are an integral part of these statements.
-6-
<PAGE> 7
SCOPE INDUSTRIES AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
DECEMBER 31, 1998
1. The accompanying interim consolidated financial statements of Scope
Industries are unaudited. The consolidated financial statements reflect
all adjustments (consisting of only normal recurring accruals) which
are, in the opinion of management, necessary for the fair presentation
of the financial position as of December 31, 1998 and June 30, 1998,
and the results of its operations and cash flows for the six months
ended December 31, 1998 and 1997. The accounting policies followed by
the Company are set forth in Note 1 of its financial statements in its
1998 Annual Report which is incorporated by reference on Form 10-K. The
results of operations for the interim periods should not be considered
indicative of results to be expected for the full year.
2. Effective July 1, 1998, the Company adopted Statement of Financial
Accounting Standards (SFAS) No. 130, "Reporting Comprehensive Income".
Other comprehensive income for the Company is comprised of changes in
unrealized holding gains or losses on investments available for sale,
net of taxes and when combined with net income, results in
comprehensive net income. Comprehensive income disclosure is presented
in Note 6.
3. Treasury bills consisted of the following:
<TABLE>
<CAPTION>
December 31 June 30
1998 1998
----------- -----------
<S> <C> <C>
At adjusted cost which approximates
fair value $41,013,273 $43,024,640
At par value 41,750,000 44,250,000
</TABLE>
4. Inventories consisted of the following:
<TABLE>
<CAPTION>
December 31 June 30
1998 1998
----------- --------
<S> <C> <C>
Finished products $196,122 $276,320
Raw materials 198,357 207,862
Operating supplies 175,515 178,217
-------- --------
$569,994 $662,399
======== ========
</TABLE>
-7-
<PAGE> 8
SCOPE INDUSTRIES AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
DECEMBER 31, 1998
(CONTINUED)
5. Investments consisted of the following:
<TABLE>
<CAPTION>
Net Unrealized
Gains Before
Provision For
Cost Income Taxes Fair Value
---- ------------ ----------
<S> <C> <C> <C>
At December 31, 1998:
- ---------------------
Investments available
for sale $ 2,682,984 $10,840,348 $13,523,332
Other equity investments 2,006,002 2,006,002 (a)
At June 30, 1998:
- -----------------
Investments available
for sale $ 3,071,776 $14,255,023 $17,326,799
Other equity investments 2,006,002 2,006,002 (a)
</TABLE>
(a) No quoted prices are available for these securities.
Gains of $10,258 and $4,128,161 from sales of investments were included
in the determination of the respective loss and net income for the six
month period ended December 31, 1998 and 1997.
6. Comprehensive income consisted of the following:
<TABLE>
<CAPTION>
Six Months Ended
December 31
------------------------------
1998 1997
------------ ------------
<S> <C> <C>
Net (loss) income $ (233,432) $ 3,616,635
Unrealized holding (losses) gains
arising during the period,
net of income taxes (2,159,416) 15,218,985
Reclassify gains realized and
included in net income,
net of income taxes (5,258) (2,563,161)
------------ ------------
Other comprehensive (loss) income (2,164,674) 12,655,824
------------ ------------
Comprehensive (loss) income $ (2,398,106) $ 16,272,459
============ ============
</TABLE>
7. The benefit for income taxes for the six months ended December 31, 1998
is 14.6% of the loss before taxes. The determination of the benefit or
provision for income taxes considers certain permanent differences
between taxable income or loss and income or loss as reported using
generally accepted accounting methods. Those differences sometimes
cause distortions in the relationships between income or loss before
income taxes and the benefit or provision for income taxes. For the six
month period ended December 31, 1997 the effective rate for income
taxes was 37.9%.
-8-
<PAGE> 9
SCOPE INDUSTRIES AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS AND FINANCIAL CONDITION
RESULTS OF OPERATIONS
The Company's second fiscal quarter ended December 31, 1998 resulted in a net
loss of $238,084 which is a $0.21 loss per share-diluted. For the second quarter
last year, net income was $3,201,820, which was $2.80 per share-diluted. Total
operating revenues for this year's second quarter were 25% below the revenues
for the same quarter last year. Waste Material Recycling segment revenues in the
current quarter dropped 27% from last year's second quarter revenues. The
segment's reduced revenues were a result of unit selling prices falling 27% from
the year earlier average price level. Selling prices of Dried Bakery Product
closely track corn prices as they are competitive feed commodities. Cash corn
prices during the quarter ending December 1998 averaged 76% of year earlier
prices. Vocational School Group revenues for the quarter were 2% above revenues
for the same quarter last year. Operating costs for the Waste Material Recycling
segment dropped 7% compared to the same quarter last year. Vocational School
Group operating costs were 2% higher in the current quarter than in the
comparable quarter last year. The dramatic selling price drop for the Waste
Material Recycling segment production, accompanied by costs that were reduced
but not to the same extent as the drop in sales prices, resulted in an operating
loss for the segment. Vocational School operations for the quarter were
profitable. For the comparable quarter last year, operations in both the Waste
Material Recycling segment and the Vocational School Group segment were
profitable.
Investment and other income for the quarter ended December 31, 1998 is $607,809
compared to $4,584,245 for the same three months last year. Investment income
for the current quarter is comprised primarily of interest income. The year
earlier quarter included gains of $4,128,161 from sales of investments.
For the six months ended December 31, 1998, the Company incurred a net loss of
$233,432 or $0.21 loss per share-diluted. For the comparable six months in the
prior year, net income was $3,616,635 or $3.12 per share-diluted. Revenues for
the six months ended December 31, 1998 were 23% less than revenues for the
comparable six months last year. The reduced revenue in the current six month
period is a result of lower product prices realized in the Waste Material
Recycling segment in this year's six month period compared to prices that
prevailed for the six month period last year. Corn prices have been lower during
the current six month period than the prices during the comparable period last
year. As a consequence, the Company's Dried Bakery Product has sold at lower
prices in the current period compared to the comparable six months last year.
The Waste Material Recycling segment incurred an operating loss in the six month
period ended December 31, 1998 compared to achieving profits in the prior
year's six month period. The Vocational School Group segment operated profitably
during the current and the previous year's six months periods ending December
31.
Investment and other income for the six months ended December 31, 1998 is
$1,292,171. It was $5,014,112 for the comparable six months last year. The
investment income for the earlier period included gains on investments sold of
$4,128,161.
-9-
<PAGE> 10
SCOPE INDUSTRIES AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS AND FINANCIAL CONDITION
(CONTINUED)
Effective July 1, 1998, the Company adopted Statement of Financial Accounting
Standards (SFAS) No. 130, "Reporting Comprehensive Income". Changes in
unrealized gains or losses on investments available for sale are included as
other comprehensive income and when combined with net income, results in
comprehensive income. During the six months ended December 31, 1998, unrealized
holding gains, net of income taxes, decreased from $9,380,022 to $7,215,348
(loss of $2,164,674). This other comprehensive income (loss), together with the
net loss for the period of $233,432 resulted in comprehensive income (loss) for
the six months of $2,398,106. Comprehensive income for the six months ended
December 31, 1997 was $16,272,459.
FINANCIAL CONDITION
Working Capital was $41,773,835 at December 31, 1998. It was $43,629,516 at June
30, 1998. The working capital ratio at December 31, 1998 was 11.1 and was 13.1
at June 30, 1998.
At December 31, 1998, investments include $10,840,348 in unrealized gains based
on fair values that exceed adjusted costs for certain securities. Nearly all of
this unrealized gain is represented by the Company's holdings in OSI Systems,
Inc. The Company, as a result of its investment in OSI Systems, Inc. in 1990, is
OSI's largest single shareholder although not a controlling shareholder.
Shareowners' equity reflects $7,215,348 net unrealized gain on investments after
a provision for deferred taxes. The unrealized holding gains are excluded from
earnings.
TAXES
The benefit for income tax credits for the six month period ended December 31,
1998 is $40,000. For the first six months of the prior fiscal year, the income
tax provision was $2,205,000 and the effective tax rate was 37.9%.
YEAR 2000
The Company has undertaken a review of its computer systems and computer
applications to identify those which could be affected by "Year 2000" problems.
Based on the review and associated testing, the Company believes that its
financial data and reporting systems are "Year 2000" ready. The Company also
believes its operating systems will not have serious concerns in this regard and
are capable of operating in alternative modes that could circumvent "Year 2000"
problems. The Company is continuing to review and test its systems and to
monitor vendors and service providers to determine what impact may result from
the "Year 2000" issue and if action or additional planning is needed. Risks
exist that could severely effect the Company's ongoing business should serious
failures or interruptions occur in services from utilities, banks, government
agencies, government Student Aid funding programs, securities markets or others.
Expenses incurred to date to correct "Year 2000" problems have not been material
and it is anticipated that no significant additional costs will be incurred with
regard to "Year 2000" issues.
-10-
<PAGE> 11
SCOPE INDUSTRIES AND SUBSIDIARIES
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS
OF OPERATIONS AND FINANCIAL CONDITION
(CONTINUED)
FORWARD LOOKING STATEMENTS
Forward looking statements included in this Management's Discussion and Analysis
of Operations and Financial Condition and included elsewhere in this quarterly
report, are subject to risks and uncertainties that could affect actual future
results. Potential risks and uncertainties include, but are not limited to,
general business conditions, unusual volatility in equity and interest rate
markets, disruptions in the availability or pricing of raw materials,
transportation difficulties, changing government educational aid policies, or
disruption of operations from acts of God.
PART II. OTHER INFORMATION
SCOPE INDUSTRIES AND SUBSIDIARIES
Item 2. Increases and Decreases in Outstanding Securities and Indebtedness.
Increases and decreases in outstanding equity securities in the six months
ending December 31, 1998 were as follows:
<TABLE>
<CAPTION>
Common Stock
No Par Value
------------
<S> <C>
Shares outstanding June 30, 1998 1,122,842
Shares purchased and retired
during the six months (7,375)
Shares issued for stock options
exercised 900
----------
Shares outstanding December 31, 1998 1,116,367
==========
</TABLE>
A corporate resolution requires the retirement of all reacquisitions of common
stock. During the six months ended December 31, 1998, the Company purchased and
retired 7,375 shares of common stock at a cost of $506,539.
-11-
<PAGE> 12
PART II. OTHER INFORMATION (CONTINUED)
SCOPE INDUSTRIES AND SUBSIDIARIES
Item 5. Other Information.
On October 27, 1998 the Company's board of directors declared a regular dividend
of $1.00 per share payable on January 5, 1999 to shareowners of record at
November 30, 1998.
On February 9, 1999, the Company, through its wholly-owned subsidiary, Scope
Products, Inc., agreed to purchase the bakery waste recycling business of
Darling International Inc. The business, known as International Processing
Corporation, consists of manufacturing facilities located in Georgia, Illinois,
Indiana, Kansas, New Jersey, North Carolina, Ohio and Texas which process waste
bakery materials into animal feed. Darling International Inc., whose stock is
traded on the American Stock Exchange, (symbol DAR), is a recycler of animal
processing by-products. The acquisition of all the outstanding shares of
International Processing Corporation and its affiliate International
Transportation Service, Inc., which comprise the bakery waste recycling business
to be acquired, if successfully completed, is to be an all cash purchase for
$22,000,000. The transaction is expected to be completed and be effective in
early April 1999, subject to completing certain conditions including receiving
appropriate regulatory approvals.
The Company has sufficient cash on hand together with other liquid assets,
including US Treasury bills, to complete the purchase without utilizing
borrowings or credit lines that may be available to it.
Item 6. Exhibits and Reports on Form 8-K.
(A) Exhibits - None
(B) No Form 8-K was filed for the quarter ended December 31, 1998.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized and accepting responsibility as the
signatory.
SCOPE INDUSTRIES
(Registrant)
DATE: February 12, 1999 /s/ John J. Crowley
------------------------------- -------------------------------
John J. Crowley, Vice President
and Chief Financial Officer
-12-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED BALANCE SHEET AT DECEMBER 31, 1998 AND THE CONSOLIDATED STATEMENT
OF OPERATIONS FOR THE SIX MONTHS ENDED DECEMBER 31, 1998 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> JUN-30-1999
<PERIOD-START> JUL-01-1998
<PERIOD-END> DEC-31-1998
<CASH> 1,040,345
<SECURITIES> 41,013,273
<RECEIVABLES> 1,640,214
<ALLOWANCES> 194,814
<INVENTORY> 569,994
<CURRENT-ASSETS> 45,924,370
<PP&E> 34,728,339
<DEPRECIATION> 24,109,850
<TOTAL-ASSETS> 73,589,833
<CURRENT-LIABILITIES> 4,150,535
<BONDS> 0
0
0
<COMMON> 4,161,300
<OTHER-SE> 62,992,998
<TOTAL-LIABILITY-AND-EQUITY> 73,589,833
<SALES> 7,991,983
<TOTAL-REVENUES> 10,294,884
<CGS> 7,131,422
<TOTAL-COSTS> 11,860,487
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (273,432)
<INCOME-TAX> (40,000)
<INCOME-CONTINUING> (233,432)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (233,432)
<EPS-PRIMARY> (0.21)
<EPS-DILUTED> (0.21)
</TABLE>
