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
September 30, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number: 0-19580
INDUSTRIAL HOLDINGS, INC.
(exact name of registrant as specified in its charter)
TEXAS
(STATE OR OTHER JURISDICTION
OF INCORPORATION OR ORGANIZATION)
76-0289495
(IRS EMPLOYER
IDENTIFICATION NO.)
7135 ARDMORE, HOUSTON, TEXAS 77054
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES, INCLUDING ZIP CODE)
(713) 747-1025
(REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE)
Indicate by check mark whether the registrant (i) 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 (ii) has been subject to such
filing requirements for the past 90 days. Yes [x] No [ ]
At November 7, 1997, there were 6,489,368 shares of Common Stock
outstanding.
<PAGE>
INDUSTRIAL HOLDINGS, INC.
INDEX
PAGE NO.
PART I FINANCIAL INFORMATION
Item 1 Financial Statements
Consolidated Balance Sheets at September 30, 1997 1
and December 31, 1996
Consolidated Statement of Income for the 2
Three Months ended September 30, 1997 and 1996
Consolidated Statement of Income for the 3
Nine Months Ended September 30, 1997 and 1996
Consolidated Statement of Cash Flows for the 4
Nine Months ended September 30, 1997 and 1996
Notes to Consolidated Financial Statements 5
Item 2 Management's Discussion and Analysis of Financial 8
Condition and Results of Operations
PART II OTHER INFORMATION
Item 1. Legal Proceedings 11
Item 2. Changes in Securities (no response required)
Item 3. Defaults upon Senior Securities
(no response required)
Item 4. Submission of Matters to a Vote of
Security Holders (no response required)
Item 5. Other Information 11
Item 6. Exhibits and reports on Form 8-K 11
<PAGE>
INDUSTRIAL HOLDING, INC.
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
September 30 December 31
1997 1996
------------ -------------
ASSETS
Current assets:
Cash and equivalents $ 216,465 $ 3,087,925
Accounts receivable - trade, net 11,083,933 6,756,218
Inventories 12,556,105 9,970,337
Advances to shareholders 92,280 77,086
Notes receivable, current portion 981,151 207,549
Other current assets 1,152,533 333,839
------------ -------------
Total current assets 26,082,467 20,432,954
Property and equipment, net 18,917,518 15,579,410
Notes receivable, less current portion 1,213,657 1,464,393
Other assets 768,151 714,495
Goodwill and other, net 12,833,286 5,498,271
------------ -----------
Total assets $59,815,079 $43,689,523
=========== ===========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Notes payable $10,109,716 $ 9,615,917
Accounts payable - trade 6,957,876 4,601,082
Accrued expenses and other 2,319,985 1,721,487
Current portion of long-term debt 1,616,719 1,393,712
------------ ------------
Total current liabilities 21,004,296 17,332,198
Long-term debt, less current portion 6,045,388 7,326,444
Deferred compensation payable,
less current portion 247,882 285,532
Deferred income taxes payable 2,648,107 2,190,902
Common stock with put redemption option
600,000 shares issued and outstanding 6,000,000
Shareholders' equity:
Common stock $.01 par value, 50,000,000
shares authorized, 5,829,845 and 4,851,494
shares issued and outstanding 58,298 48,515
Additional paid-in capital 20,655,849 15,360,801
Retained earnings 3,155,259 1,145,131
------------ -------------
Total shareholders' equity 23,869,406 16,554,447
------------ -------------
Total liabilities and shareholders'
equity $59,815,079 $43,689,523
============ ============
See notes to consolidated financial statements
1
<PAGE>
INDUSTRIAL HOLDINGS, INC.
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
THREE MONTHS ENDED SEPTEMBER 30,
--------------------------------
1997 1996
----------- ------------
Sales $21,054,159 $12,870,367
Cost of sales 16,168,676 10,177,771
----------- ------------
Gross profit 4,885,483 2,692,596
Selling, general and administrative 3,682,107 2,119,196
------------ ------------
Income from operations 1,203,376 573,400
------------ -------------
Other income:
Interest expense (396,472) (282,119)
Interest income 44,356 35,146
Other income (expense) 243,901 5,951
------------ --------------
Total other income (expense) (108,215) (241,022)
------------- -------------
Income before income taxes 1,095,161 332,378
Income tax expense 428,806 126,584
----------- ------------
Net income $ 666,355 $ 205,794
========== ============
Earnings per share $ .09 $ .05
========== ============
See notes to consolidated financial statements
2
<PAGE>
INDUSTRIAL HOLDINGS, INC.
CONSOLIDATED STATEMENT OF INCOME (UNAUDITED)
NINE MONTHS ENDED SEPTEMBER 30,
-------------------------------
1997 1996
----------- -----------
Sales $59,642,306 $38,497,695
Cost of sales 44,953,700 30,435,134
----------- -----------
Gross profit 14,688,606 8,062,561
Selling, general and administrative 10,438,071 6,018,452
----------- ------------
Income from operations 4,250,535 2,044,109
------------ ------------
Other income (expense):
Interest expense (1,281,112) (960,340)
Interest income 130,699 95,540
Other income (expense) 273,203 (4,409)
------------ -------------
Total other income (expense) (877,210) (869,209)
------------- -------------
Income before income taxes 3,373,325 1,174,900
Income tax expense 1,363,197 413,040
----------- ------------
Net income $2,010,128 $ 761,860
========== ===========
Earnings per share $ .30 $ .19
========== ===========
See notes to consolidated financial statements
3
<PAGE>
INDUSTRIAL HOLDINGS, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS (UNAUDITED)
NINE MONTHS ENDED SEPTEMBER 30,
-------------------------------
1997 1996
---- ----
Cash flows from operating activities:
Net income $ 2,010,128 $ 761,860
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 1,781,729 912,348
Deferred income tax provision 10,127 242,349
Deferred compensation paid (37,650)
Changes in assets and liabilities,
net of acquisitions:
Accounts receivable and advances to
shareholders (930,042) (347,643)
Inventories (907,112) (835,770)
Notes receivable (522,866) 202,200
Other assets (773,638) (249,075)
Accounts payable and accrued expenses 52,723 (301,677)
----------- ------------
Net cash provided
by operating activities 683,399 384,592
Cash flows from investing activities:
Purchase of property and equipment (949,603) (1,752,269)
Purchase of subsidiaries, net of cash (2,338,627)
Additional consideration paid to former
shareholders of Landreth (99,396)
------------ ------------
Net cash used by investing activities (3,288,230) (1,851,665)
------------ ------------
Cash flows from financing activities:
Net borrowing under revolving line of credit (1,128,701) 708,396
Proceeds from long-term debt 397,694 468,361
Principal payments on notes payable,
long-term debt and capital lease obligations (1,141,134) (1,021,698)
Proceeds from issuance of common stock 1,605,512 2,014,675
------------ ------------
Net cash provided (used) by financing activities (266,629) 2,169,734
------------ ------------
Net increase (decrease) in cash and equivalents (2,871,460) 702,661
Cash and equivalents, beginning of period 3,087,925 428,430
------------ ------------
Cash and equivalents, end of period $ 216,465 $1,131,091
============ ============
Non-cash financing activities:
Debt converted to equity $3,093,000 $1,619,100
See notes to consolidated financial statements
4
<PAGE>
INDUSTRIAL HOLDINGS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
SEPTEMBER 30, 1997
NOTE A BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been
prepared in accordance with generally accepted accounting principles
for interim financial information and with the instructions to Form
10-Q and Article 10 of Regulation S-X. Accordingly, they do not
include all of the information and footnotes required by generally
accepted accounting principles for complete financial statements. In
the opinion of management, all adjustments (consisting of normal
recurring accruals) considered necessary for fair presentation have
been included. These financial statements include the accounts of
Industrial Holdings, Inc. and its subsidiaries (the "Company"). All
significant intercompany balances have been eliminated in
consolidation. Operating results for the nine months ended September
30, 1997 are not necessarily indicative of the results that may be
expected for the year ended December 31, 1997. For further
information, refer to the consolidated financial statements and
footnotes thereto included in the Company's annual report on Form 10-K
for the year ended December 31, 1996.
NOTE B INVENTORY
Inventory consists of the following:
September 30 December 31
1997 1996
------------ ------------
Raw materials $ 1,932,292 $ 1,477,051
Finished goods 9,106,862 7,130,702
Other 1,516,951 1,362,584
------------ ------------
$12,556,105 $ 9,970,337
=========== ===========
NOTE C RECLASSIFICATION
Certain amounts have been reclassified from previous periods to
conform to the current presentation.
NOTE D ACCOUNTING PRONOUNCEMENTS
Effective January 1, 1996, the Company adopted Statement of Financial
Accounting Standards No. 123 "Accounting of Stock-based Compensation"
("SFAS No. 123"), and elected to continue to follow Accounting
Principles Board Opinion No. 25 to measure employee stock compensation
cost. Had compensation expense been determined using the fair value
method of accounting as set forth in SFAS No. 123, net income and
earnings per share would have been $1,684,853 and $.25 and $624,702
and $.08 for the nine months and three months ended September 30,
1997, respectively.
5
<PAGE>
In February 1997, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 128, "Earnings Per
Share" ("SFAS No. 128"). This new standard requires dual presentation
of basic and diluted earnings per share ("EPS") on the face of the
earnings statement and requires a reconciliation of the numerators and
denominators of basic and diluted EPS calculations. This statement
will be effective for both interim and annual periods ending after
December 15, 1997. The Company's current EPS calculation conforms to
basic EPS. Diluted EPS as defined by SFAS No. 128 is not expected to
be materially different from basic EPS.
Recently, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 130, "Reporting Comprehensive
Income," and Statement of Financial Accounting Standards No. 131,
"Disclosures About Segments of an Enterprise and Related Information."
These statements, which are effective for the Company's fiscal year
ending December 31, 1998, establish additional disclosure requirements
but do not affect the measurement of results of operation. Management
is evaluating what, if any, additional disclosures may be required
when these statements are implemented.
NOTE E NOTES PAYABLE AND LONG TERM DEBT
In June 1997, St. James Capital Partners, L.P. ("St. James") converted
at a conversion price of $10 per share, a $1,900,000, 12% note payable
(the "St. James Note") together with $133,000 in accrued interest into
203,300 shares of common stock. The St. James Note was entered into in
November 1996 to fund a portion of the purchase price of American
Rivet Company, Inc.
In the second and third quarters of 1997, Renaissance Capital Partners
II Ltd. ("Renaissance") converted the $1,060,000 outstanding principal
balance of its 12% convertible debenture (the "Renaissance Debenture")
into 325,154 shares of common stock at a conversion price of $3.26 per
share. The Renaissance Debenture was entered into in 1992 to fund a
portion of the purchase price of Landreth Engineering Company.
NOTE F ACQUISITIONS
In February 1997, the Company acquired LSS-Lone Star-Houston, Inc.
("Lone Star") and in March 1997, the Company acquired Manifold Valve
Service, Inc. ("MVS"). The aggregate purchase price of the
acquisitions was $10.1 million cash and assumed liabilities plus
684,211 shares of common stock valued at $6.6 million. The final
purchase price allocation is subject to certain adjustments relating
to the appraised value of assets and to certain other accruals. The
acquisitions were accounted for as purchases. The aggregate excess of
cost over net assets acquired of $7.5 million is being amortized over
20 years. The results of operations of the acquired businesses have
been included in the consolidated financial statements from the
respective acquisition dates. Additionally, the 600,000 shares of
common stock issued in connection with the acquisition of MVS include
a put redemption option at $10 per share through August 1999.
6
<PAGE>
Lone Star is a leading manufacturer and distributor of fasteners to
the petrochemical and energy industries, and is a specialty provider
of custom in-house coating services. Its 53,000 square foot
manufacturing facility is located in Spring, Texas. MVS, operating
from a 25,000 square foot leased manufacturing facility in Jennings,
Louisiana, sells and repairs high pressure valves that are used
primarily in oil and gas drilling applications.
On a proforma unaudited basis, as if these acquisitions had occurred
as of January 1, 1997, sales, net income and earnings per share for
the nine months ended September 30, 1997 would have been $61,404,306,
$2,233,128 and $.32.
NOTE G SUBSEQUENT EVENT
In November 1997, the Company acquired all of the outstanding stock of
Bolt Manufacturing Co., Inc. ("Bolt") for $6.2 million cash (the "Bolt
Acquisition"). The purchase price was funded through an increase in
the Company's demand note and line of credit payable to Comerica
Bank-Texas ("Demand Note") to be secured by the inventory and
receivables of the Company and a 8.16% term note ("Term Note") secured
by the equipment of the Company.
Bolt, located in Houston, Texas manufactures and distributes specialty
bolts and nuts to the petrochemical and energy industries through the
United States and Canada. Net sales of Bolt were $6,452,216 for its
fiscal year ended December 31, 1996 and $5,419,698 for the nine months
ended September 30, 1997. Bolt will operate within the Fastener
Manufacturing and Sales Division.
7
<PAGE>
PART I
FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations.
The financial information in the following discussion of Industrial
Holdings, Inc. (including its subsidiaries, the "Company"), includes
the operating results of Industrial Holdings, Inc. ("IHI") and its
subsidiaries. The Company's business is organized into two divisions:
the Fastener Manufacturing and Sales Division, comprised of Landreth
Engineering Company ("Landreth"), Connecticut Rivet ("CRivet"),
American Rivet Company ("American"), acquired November 1996, and
LSS-Lone Star - Houston, Inc. ("Lone Star"), acquired February 1997,
and the Energy Products and Services Division comprised of the Valve
and Supplies Sales Group which includes Pipeline Valve Specialty
("PVS"), Industrial Municipal Supply Company ("IMSCO") and Manifold
Valve Service ("MVS"), acquired March 1997; the New Machine Sales and
Services Group which includes Regal Machine Tools ("Regal") and Rex
Machinery Movers ("RMM"); the Export Crating Group which includes U.S.
Crating ("USC"); and the Used Machine Sales Group which includes
Rex/Paul's Machine Sales ("RPMS"). Regal, RMM, USC and RPMS comprise
the Rex Group ("Rex").
RESULTS OF OPERATIONS
THREE MONTHS ENDED SEPTEMBER 30, 1997 COMPARED WITH THREE MONTHS ENDED
SEPTEMBER 30, 1996.
SALES. On a consolidated basis, sales increased $8,183,792 or 63.6%
for the three months ended September 30, 1997 compared to the three
months ended September 30, 1996. This increase was primarily the
result of the acquisitions of MVS, Lone Star and American (the
"Acquisitions").
COST OF SALES. Cost of sales increased $5,990,905 or 58.9% for the
three months ended September 30, 1997 compared to the three months
ended September 30, 1996, primarily as a result of the increase in
sales described in the preceding paragraph. Gross margins increased to
23% for the three months ended September 30, 1997 from 21% for the
three months ended September 30, 1996, as the lower margin sales at
IMSCO were replaced by higher margin sales at Lone Star, American and
MVS.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. Selling, general and
administrative expenses increased $1,562,911 or 73.8% for the three
months ended September 30, 1997 compared to the three months ended
September 30, 1996. This increase was primarily attributable to the
Acquisitions. Selling, general and administrative expenses increased a
greater percentage than sales increased primarily as a result of
amortization of goodwill related to the Acquisitions.
INTEREST EXPENSE. Interest expense increased $114,353 or 40.5% for the
three months ended September 30, 1997 compared to the three months
ended September 30, 1996, primarily as a result of debt incurred to
fund the Acquisitions.
8
<PAGE>
OTHER INCOME. Other income for the three months ended September 30,
1997, includes a gain of $230,000 attributable to insurance proceeds
in excess of the net book value of equipment destroyed in a building
fire.
INCOME TAXES. The Company's effective tax rate was 39% for the three
months ended September 30, 1997 compared to 38% for the three months
ended September 30, 1996. The higher effective tax rate is
attributable to the inclusion of non-deductible amortization of
goodwill as a result of the Acquisitions.
NINE MONTHS ENDED SEPTEMBER 30, 1997 COMPARED WITH NINE MONTHS ENDED
SEPTEMBER 30, 1996.
SALES. Sales increased $21,144,611 or 54.9% for the nine months ended
September 30, 1997 compared to the nine months ended September 30,
1996. This increase was primarily attributable to the Acquisitions,
which was partially offset by a $4.4 million decrease in sales at
IMSCO as the result of the loss of key salesmen at that subsidiary.
COST OF SALES. Cost of sales increased $14,518,566 or 47.7% for the
nine months ended September 30, 1997 compared to the nine months ended
September 30, 1996, primarily as a result of the increase in sales
described in the preceding paragraph. Gross margins increased to 25%
for the nine months ended September 30, 1997 from 21% for the nine
months ended September 30, 1996 as the lower margin sales at IMSCO
were replaced by higher margin sales at American, Lone Star and PVS.
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES. Selling, general and
administrative expenses increased $4,419,619 or 73.4% for the nine
months ended September 30, 1997 compared to the nine months ended
September 30, 1996. The increase was primarily attributable to the
Acquisitions. Selling, general and administrative expenses increased a
greater percentage than sales increased primarily as a result of
amortization of goodwill related to the Acquisitions.
INTEREST EXPENSE. Interest expense increased $320,772 or 33.4% for the
nine months ended September 30, 1997 compared to the nine months ended
September 30, 1997 primarily as a result of debt incurred to fund the
Acquisitions.
OTHER INCOME. Other income for the nine months ended September 30,
1997, includes a gain of $230,000 attributable to insurance proceeds
in excess of the net book value of equipment destroyed in a building
fire.
INCOME TAXES. The Company's effective tax rate was 40% for the nine
months ended September 30, 1997 compared to 35% for the nine months
ended September 30, 1996. The increase in the effective tax rate for
the nine months ended September 30, 1997 is primarily attributable to
the inclusion of non-deductible amortization of goodwill as a result
of the Acquisitions.
TOTAL ASSETS. Total assets were $59,815,079 at September 30, 1997
compared to $43,689,523 at December 31, 1996. This increase was
primarily attributable to the acquisitions of Lone Star and MVS.
9
<PAGE>
TOTAL LIABILITIES. Total liabilities were $29,945,673 at September 30,
1997 compared to $27,135,076 at December 31, 1996. This increase was
primarily attributable to an increase in trade accounts payable, notes
payable, and long term debt as a result of the acquisitions of Lone
Star and MVS which was partially offset by the conversion of
$3,093,000 of debt to equity.
LIQUIDITY AND CAPITAL RESOURCES. At September 30, 1997, the Company
had cash of $216,465 and additional borrowing capacity under its line
of credit of $2,302,957. The Company's operations provided cash of
$683,399 during the nine months ended September 30, 1997 compared to
$384,592 during the nine months ended September 30, 1996. This 78%
increase was primarily attributable to increased net income and
depreciation and amortization for the nine months ended September 30,
1997 compared to the same period in 1996 which was partially offset by
increases in working capital.
Investing activities used cash of $3,288,230 for the nine months ended
September 30, 1997 compared to $1,851,665 for the nine months ended
September 30, 1996. This increased use of cash was primarily
attributable to the acquisition of Lone Star and MVS.
Financing activities used cash of $266,629 for the nine months ended
September 30, 1997 compared to providing cash of $2,169,734 for the
nine months ended September 30, 1996. This change is due to the
repayment of short term and long term borrowings in the nine month
period ended September 30, 1997.
At September 30, 1997, the Company had working capital of $5,078,171,
long-term debt of $6,045,388 and shareholders' equity of $23,869,406.
The Company anticipates that its operating cash needs for fiscal 1997
can be met with cash generated from operations, borrowings under its
credit facilities with Comerica Bank-Texas, and private placements of
securities. However, any acquisition of companies in connection with
the Company's acquisition strategy will require additional financing,
which likely would include a combination of debt and equity financing.
10
<PAGE>
PART II
OTHER INFORMATION
Item 1. Legal Proceedings.
The Company is involved in litigation arising in the ordinary course of
its business. In the opinion of management, the ultimate liability, if
any, as a result of these matters will not have a material adverse
effect on the Company's consolidated financial condition or results of
operations.
Item 5. Other Information.
In October 1997, the Company filed a Registration Statement on Form S-2
in which the Company offers to the holders of its 1,254,414 outstanding
Class B Redeemable Common Stock Purchase Warrants ("Class B Warrants")
the opportunity to exchange each Class B Warrant and $10 cash for one
share of Common Stock, one Class C Warrant and one newly created Class D
Warrant with an exercise price of $22.50 per share. The exchange offer
will commence upon effectiveness of the registration statement which is
subject to review by the SEC. The Company anticipates that it will use
the majority of the estimated $12,400,000 net proceeds from the exercise
of the Class B Warrants to repay a portion of the Company's Demand Note
and Term Note.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibit 11 - Earnings per Share
(b) Reports on Form 8-K
On September 3, 1997, the Company filed a Form 8-K to report a change in
the Company's certifying accountants. The Company has engaged Deloitte &
Touche LLP, to act as independent certified public accountants. Deloitte
& Touche LLP replaces Price Waterhouse LLP who resigned on May 8, 1997.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the Registrant, Industrial Holdings, Inc., has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
INDUSTRIAL HOLDINGS, INC.
Date: November 12, 1997 By: /s/ CHRISTINE A. SMITH
Christine A. Smith,
Chief Financial Officer
and Vice President
11
<PAGE>
INDUSTRIAL HOLDINGS, INC.
EARNINGS PER SHARE
SEPTEMBER 30, 1997
Earnings per share is based upon the weighted average number of common and
common equivalent shares outstanding during the period as follows:
<TABLE>
<CAPTION>
THREE MONTHS NINE MONTHS
ENDED SEPTEMBER 30 ENDED SEPTEMBER 30
----------------------- -----------------------
1997 1996 1997 1996
---------- ---------- ---------- ----------
<S> <C> <C> <C> <C>
Average common shares outstanding .... 6,412,450 3,806,843 5,919,945 3,485,934
Net effect of dilutive stock options
and warrants, based on the treasury
stock method using average
market price ...................... 1,003,881 752,368 862,831 616,164
---------- ---------- ---------- ----------
7,416,331 4,559,211 6,782,776 4,102,098
========== ========== ========== ==========
Net income ........................... $ 666,355 $ 205,794 $2,010,128 $ 761,860
========== ========== ========== ==========
Earnings per share ................... $ .09 $ .05 $ .30 $ .19
========== ========== ========== ==========
</TABLE>
The above table represents primary earnings per share. Fully diluted earnings
per share for the three months and nine months ended September 30, 1997 and 1996
were the same as primary earnings per share.
12
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<CASH> 216,465
<SECURITIES> 0
<RECEIVABLES> 11,083,933
<ALLOWANCES> 0
<INVENTORY> 12,556,105
<CURRENT-ASSETS> 26,082,467
<PP&E> 18,917,518
<DEPRECIATION> 0
<TOTAL-ASSETS> 59,815,079
<CURRENT-LIABILITIES> 21,004,296
<BONDS> 0
0
0
<COMMON> 58,298
<OTHER-SE> 23,811,108
<TOTAL-LIABILITY-AND-EQUITY> 59,815,079
<SALES> 59,642,306
<TOTAL-REVENUES> 59,642,306
<CGS> 44,953,700
<TOTAL-COSTS> 55,391,771
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,281,112
<INCOME-PRETAX> 3,373,325
<INCOME-TAX> 1,363,197
<INCOME-CONTINUING> 2,010,128
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,010,128
<EPS-PRIMARY> .30
<EPS-DILUTED> .30
</TABLE>
