<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------
FORM 10-Q
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 01-9723
PHARMACEUTICAL MARKETING SERVICES INC.
(Exact Name of Registrant as Specified in its Charter)
Delaware 51-0335521
(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification Number)
2394 East Camelback Road, Phoenix, AZ 85016
-------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code (602) 381-9800
----------------------------------------------------------
(Former Name, Former Address and Former Fiscal Year,
if Changed Since Last Report.)
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
--- ---
As of April 30, 1996, there were outstanding 13,166,925 shares of Common Stock
of Pharmaceutical Marketing Services Inc.
<PAGE> 2
PHARMACEUTICAL MARKETING SERVICES INC. AND SUBSIDIARIES
INDEX TO FORM 10-Q
<TABLE>
<CAPTION>
PAGE NO.
<S> <C>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Statements of Operations
(unaudited) for the Three and Nine Months
Ended March 31, 1996 and 1995......................... 2
Consolidated Balance Sheets as of
March 31, 1996 (unaudited) and
June 30, 1995......................................... 3
Consolidated Statements of Cash Flows
(unaudited) for the Nine Months Ended
March 31, 1996 and 1995............................... 4
Notes to Consolidated Financial Statements............ 5
Item 2. Management's Discussion and Analysis
of Results of Operations and
Financial Condition................................... 7
PART II. OTHER INFORMATION
Item 4. Submission of Matters to a Vote of
Security-Holders...................................... 11
Item 6. Exhibits and Reports on Form 8-K...................... 11
Signatures............................................ 12
Index to Exhibits..................................... 13
</TABLE>
<PAGE> 3
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
PHARMACEUTICAL MARKETING SERVICES INC. AND SUBSIDIARIES
-------------------------------------------------------
CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT PER SHARE DATA)
(UNAUDITED)
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
------------------ -----------------
MARCH 31, MARCH 31, MARCH 31, MARCH 31,
--------- --------- --------- ---------
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenue $ 23,126 $ 22,094 $ 68,125 $ 64,221
Production costs (13,651) (12,303) (38,005) (36,946)
Selling, general and administrative
expenses (8,490) (6,204) (25,620) (20,574)
Amortization of intangible assets (524) (452) (1,558) (1,340)
Impairment of long-lived assets (2,368) 0 (2,368) 0
Restructuring charge (2,314) 0 (2,314) 0
-------- -------- -------- --------
Operating income (loss) (4,221) 3,135 (1,740) 5,361
Interest expense (610) (625) (2,047) (2,171)
Interest income 435 788 1,859 2,205
-------- -------- -------- --------
Income (loss) from continuing
operations before income taxes (4,396) 3,298 (1,928) 5,395
Income tax (provision) (276) (1,175) (276) (1,856)
Minority interest 12 15 41 14
-------- -------- -------- --------
Income (loss) from continuing
operations (4,660) 2,138 (2,163) 3,553
Discontinued operations:
Income (loss) from discontinued
non-database operations, net of
income tax (provision) benefit of
$(503), $(384), $(917) and $134,
respectively (1,452) 126 (3,205) (810)
Loss on disposal of non-database
operations,including $2,031 of
operating income during phase out
period, net of income taxes of
$1,236 (5,710) 0 (5,710) 0
-------- -------- -------- --------
Net income (loss) $(11,822) $ 2,264 $(11,078) $ 2,743
======== ======== ======== ========
Earnings (loss) per common share:
Income (loss) from continuing
operations $ (0.35) $ 0.16 $ (0.17) $ 0.27
Income (loss) from discontinued
operations (0.11) 0.01 (0.24) (0.06)
Loss on disposal of discontinued
operations (0.43) 0.00 (0.44) 0.00
-------- -------- -------- --------
Net income (loss) per share $ (0.89) $ 0.17 $ (0.85) $ 0.21
======== ======== ======== ========
Common stock and common stock
equivalents (for 1995 periods) 13,146 13,145 13,110 13,129
</TABLE>
The accompanying notes are an integral part of these financial statements
2
<PAGE> 4
PHARMACEUTICAL MARKETING SERVICES INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS, EXCEPT FOR SHARE DATA)
<TABLE>
<CAPTION>
MARCH 31, 1996 JUNE 30, 1995
-------------- -------------
(Unaudited)
<S> <C> <C>
ASSETS
Current assets
Cash and cash equivalents $ 20,193 $ 38,510
Marketable securities 28,178 25,918
Accounts receivable, principally trade
(less allowance for doubtful accounts of
$215 and $410, respectively) 23,814 39,329
Work in process 3,023 4,400
Prepaid expenses and other current assets 8,310 8,255
Net current assets of discontinued operations 5,904 --
--------- ---------
Total current assets 89,422 116,412
Marketable securities 1,008 3,028
Property and equipment, net 9,282 14,519
Goodwill, net 27,452 59,368
Other assets, net 7,098 8,481
Net non-current assets of discontinued operations 35,068 --
--------- ---------
Total assets $ 169,330 $ 201,808
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Current maturities of long-term debt $ 264 $ 640
Accounts payable 3,542 11,976
Accrued liabilities 10,123 19,574
Unearned income 12,520 11,321
--------- ---------
Total current liabilities 26,449 43,511
Long-term debt 69,171 70,399
Other liabilities 486 698
Minority interest 479 503
--------- ---------
Total liabilities 96,585 115,111
Stockholders' equity
Common stock, $0.01 par value, 25,000,000
shares authorized and 13,166,925 and 13,085,275
shares issued and outstanding, respectively 132 131
Paid-in capital 86,921 86,176
Accumulated deficit (16,230) (5,152)
Cumulative translation adjustment 1,923 5,544
Unrealized loss on investments, net of
income tax benefit of $1 and $2 respectively (1) (2)
--------- ---------
Total stockholders' equity 72,745 86,697
--------- ---------
Total liabilities and stockholders' equity $ 169,330 $ 201,808
========= =========
</TABLE>
The accompanying notes are an integral part of these financial statements
3
<PAGE> 5
PHARMACEUTICAL MARKETING SERVICES INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
-----------------
MARCH 31, MARCH 31,
--------- ---------
1996 1995
-------- --------
<S> <C> <C>
Net cash flows (used in) provided by operating activities $ (3,325) $ 9,736
-------- --------
Cash flows (used in) provided by investing activities:
Acquisition payments, net of cash acquired (142) (11,364)
Deferred consideration (465) --
Capital expenditures (3,484) (6,543)
Proceeds from the sale of property and equipment 162 66
Loan to related party -- (1,200)
Purchase of marketable securities (240) (2,008)
-------- --------
Net cash used in investing activities (4,169) (21,049)
-------- --------
Cash flows provided by (used in) financing activities:
Net proceeds from options exercised 746 148
Repayment of capital leases (172) (317)
Proceeds from long-term debt -- 567
Repayment of long-term debt and other (304) (484)
-------- --------
Net cash provided by (used in) financing activities 270 (86)
-------- --------
Effect of exchange rate movements (2,231) 1,561
Effect of discontinued operations 1,808 (4,753)
-------- --------
Net decrease in cash and cash equivalents (7,647) (14,591)
Cash and cash equivalents at beginning of period (1) 27,840 52,000
-------- --------
Cash and cash equivalents at end of period $ 20,193 $ 37,409
======== ========
Supplemental disclosure of non-cash investing and
financing activities:
Capital leases -- $ 390
Fair value of assets acquired $ 141 $ 6,781
Cash consideration paid 141 5,794
-------- --------
Liabilities assumed $ -- $ 987
======== ========
</TABLE>
(1) After reclassification of cash held by discontinued operations.
The accompanying notes are an integral part of these financial statements
4
<PAGE> 6
PHARMACEUTICAL MARKETING SERVICES INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
1. INTERIM UNAUDITED FINANCIAL INFORMATION
The accompanying statements of operations for the three and
nine months ended March 31, 1996 and 1995, the statements of cash flows
for the nine months ended March 31, 1996 and 1995, the balance sheet as
of March 31, 1996 and the related information of Pharmaceutical
Marketing Services Inc. (the "Company" or "PMSI") included in these
notes to the financial statements are unaudited. These financial
statements have been restated for discontinued operations. In the
opinion of management, the interim financial information reflects all
adjustments (consisting only of items of a normal recurring nature,
except for restructuring charges, impairment of long-lived asset
charges and discontinued operations) necessary for the fair
presentation of the financial position, results of operations and cash
flows for the periods presented. Results of continuing operations for
the three and nine months ended March 31, 1996 are not necessarily
indicative of the results to be expected for the entire year.
The June 30, 1995 balance sheet was derived from the Company's
June 30, 1995 audited consolidated financial statements, but does not
include all disclosures required by generally accepted accounting
principles.
These interim financial statements should be read in
conjunction with the audited consolidated financial statements and
related notes thereto included in the Company's Annual Report for the
year ended June 30, 1995.
At March 31, 1996, Walsh International Inc. ("Walsh") owned
9.2% of the Company's common stock.
2. EARNINGS (LOSS) PER SHARE
For the three and nine months ended March 31, 1995, the
primary earnings per share were computed based upon the weighted
average number of common shares outstanding and the assumed exercise of
stock options. For the fiscal 1996 periods presented, the presumed
exercise of stock options as common stock equivalents was not assumed,
as their inclusion would be anti-dilutive.
5
<PAGE> 7
3. INCOME TAXES
The effective continuing operations income tax rates for the
quarters ended March 31, 1996 and 1995 were 106% and 36%, respectively.
For the nine months ended March 31, 1996 and 1995, the effective income
tax rates were 114% and 34%, respectively. The 1996 fiscal year
effective income tax rate is based on the Company's projected mix of
country profits which includes actual results for the nine months ended
March 31, 1996.
4. LONG-LIVED ASSETS AND GOODWILL
During the third quarter, the Company adopted the provisions
of Statement of Financial Accounting Standard no. 121 "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to be
Disposed of" ("FAS 121"). The initial application of this statement
resulted in a pre-tax charge of $2,368 principally related to the
write-off of goodwill and capitalized database costs for one of the
businesses being exited. The decision to exit of this business was made
by management during the third quarter of 1996. At the adoption of FAS
121, the Company had no other long-lived assets which were being
exited.
The Company assesses the recovery of its goodwill on a
subsidiary-by-subsidiary basis by determining whether amortization of
goodwill can be recovered through expected net future cash flows
(undiscounted and without interest charges). Impairment is measured
based on the present value of estimated expected future net cash flows
using a discount rate reflecting the Company's cost of funds.
5. RESTRUCTURING
The Company recorded $2.3 million in restructuring costs to
eliminate non-core product lines. The future cash payments associated
with the restructuring charge are $1.5 million and will be incurred
principally in fiscal 1997.
6. DISCONTINUED OPERATIONS
In the third quarter of fiscal 1996, the Company made the
determination that substantially all of its non-database marketing and
communications businesses would be sold and, therefore, has accounted
for these as discontinued operations. The sales are expected to be
completed within the next twelve months. Net assets of $41.0 million
related to the discontinued operations have been segregated in the
March 31, 1996 balance sheet. This amount consists of assets and
liabilities of the businesses to be disposed, less the estimated losses
of $5.7 million.
Revenues for the three and nine months ended March 31, 1996
and 1995 were $10.6 million, $31.8 million, $10.8 million and $27.2
million, respectively.
6
<PAGE> 8
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF
OPERATIONS AND FINANCIAL CONDITION
PHARMACEUTICAL MARKETING SERVICES INC. AND SUBSIDIARIES
THREE MONTHS ENDED MARCH 31, 1996 AND 1995
The operating results for the third quarter of fiscal 1996 reflect the
Company's decision to focus on being an information provider to the
pharmaceutical and healthcare industries. As a result, the Company will be
divesting principally all of its non-database business segment which consists of
its European communication and marketing services group. The divestiture has
been accounted for as discontinued operations. The Company will also sell its
international publishing business which is included in continuing operations,
and the Company does not expect to incur a loss upon this sale. The Company
recorded charges to its continuing information based operations reflecting
changes necessary to complete the transition to becoming an information
provider. These changes related primarily to the exit from two database service
product lines and resulted in restructuring and impairment of long-lived assets
charges.
Revenue from continuing operations for the Company's third quarter of
fiscal 1996 increased to $23.1 million from $22.1 million for the corresponding
quarter of 1995, representing an increase of 5%. The increase in revenue relates
primarily to new Scriptrac clients obtained in Japan and Europe and market
research services from the Company's Scott- Levin subsidiary. Lower revenues
were recorded in the U.S. direct marketing business where a large unprofitable
project was cancelled and in the United Kingdom market research business.
Currency exchange rate movements had minimal effect.
Production costs from continuing operations in the third quarter
increased to $13.7 million (59% of revenue) from $12.3 million (56% of revenue)
in the comparable quarter of fiscal 1995. The 11% increase in costs was
attributable to production costs associated with the revenue growth and
acquisitions which were included in fiscal 1996 results but not in the prior
period.
Selling, general and administrative costs from continuing operations
increased to $8.5 million (37% of revenue) in the third quarter compared to $6.2
million (28% of revenue) in the comparable quarter of 1995. The 37% increase is
due to new product development costs for which no revenue was generated, costs
associated with the Company's strategic business review, acquisitions which were
included in fiscal 1996 results but not the prior period and costs associated
with the revenue growth.
The $2.3 million restructuring charge relates primarily from the exit
of two database service product lines which had not performed up to expectation,
had negatively impacted year-to-date earnings and which management believes
would not deliver an adequate return on investment in the future. The future
cash payments associated with the restructuring charge are $1.5 million and will
be incurred principally in fiscal 1997.
7
<PAGE> 9
The Company recorded a charge for impairment of long-lived assets. The
majority of the charge relates to the write-down of goodwill and capitalized
database costs for one of the businesses being exited. There will be no cash
impact from the impairment charges.
Net interest expense from continuing operations for the quarter ended
March 31, 1996 was $0.2 million, an increase of $0.3 million from net interest
income of $0.1 million for the same quarter in fiscal 1995. The increase in net
interest expense was due to lower levels of funds available for investment and
the fiscal 1995 benefit from interest capitalization related to construction of
the Netherlands office building.
The Company incurred income tax expense of $0.3 million for the three
months ended March 31, 1996 on pre-tax loss of $4.4 million. The tax expense is
due to losses that were incurred in 1996 in certain jurisdictions for which a
full valuation allowance has been provided and the effects of non-deductible
goodwill amortization. The 1995 effective tax rate was 36% on pre-tax operating
income of $3.3 million.
NINE MONTHS ENDED MARCH 31, 1996 AND 1995
Revenue from continuing operations for the nine months ended March 31,
1996 increased to $68.1 million from $64.2 million for the comparable period in
fiscal 1995, representing an increase of 6%. The revenue increase was due to new
Scriptrac clients obtained in Japan and Europe, growth of Scott-Levin marketing
research and consulting services, introduction of the OTC Physician product in
the U.S. and acquisitions which had no comparable revenue in fiscal 1995. Lower
revenues were achieved in the U.S. direct marketing business where a large
unprofitable project was cancelled and in the United Kingdom market research
business. Currency exchange rate movements had minimal impact versus the prior
year.
Production costs from continuing operations for the first nine months
of fiscal 1996 were $38.0 million (56% of revenue) compared with $36.9 million
(58% of revenue) in the comparable 1995 period. The 3% increase in cost was due
to production costs of acquisitions included in fiscal 1996 results but not in
the prior period offset by lower costs due to lower revenues in U.S. direct
marketing and U.K. market research.
Selling, general and administrative costs from continuing operations
increased to $25.6 million (38% of revenue) for the nine months ended March 31,
1996 from $20.6 million (32% of revenue) for the same period in 1995. The 25%
increase was due to acquisitions which were included in fiscal 1996 results but
not the comparable 1995 period, new product development costs for which no
revenue was generated, costs associated with the Company's strategic business
review and additional sales personnel in the U.S. and Europe.
Net interest expense from continuing operations for the nine months
ended March 31, 1996 was $0.2 million, an increase of $0.3 million from the
comparable period in fiscal 1995. The increase in net interest expense was due
to lower levels of funds available for investment in 1996 and the benefit from
interest capitalization related to construction of the Netherlands office
building in 1995.
8
<PAGE> 10
The Company incurred income tax expense of $0.3 million for the nine
months ended March 31, 1996 on pre-tax loss of $1.9 million. The tax expense is
due to losses that were incurred in 1996 in certain jurisdictions for which a
full valuation allowance has been provided and the effects of non-deductible
goodwill amortization. The 1995 effective tax rate was 35% on pre-tax operating
income of $5.4 million.
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 1996, the Company's continuing cash, cash equivalents and
short-term marketable securities totaled $48.4 million, a decrease of $5.4
million from the $53.8 million (after reclassification of cash held by
discontinued operations) balance at June 30, 1995. The decrease is primarily due
to capital expenditures, working capital and currency related effects. The
current ratio from continuing operations at March 31, 1996 decreased to 3.4:1
from 3.6:1 at June 30, 1995 (net of discontinued effects).
The Company anticipates, in fiscal year 1996 and in subsequent years,
its capital expenditures and working capital requirements will be funded from
existing cash, cash equivalents and marketable securities, internally generated
funds, and funds from the divestiture of its non-database business segment and
its European publishing unit. The timing and magnitude of future acquisitions
will be the single most important factor in determining the Company's long-term
capital needs.
9
<PAGE> 11
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
11 Computation of Earnings per Share.
27 Financial Data Schedule.
(b) Reports on Form 8-K
None.
10
<PAGE> 12
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
Date: May 14, 1996 Pharmaceutical Marketing Services Inc.
--------------------------------------
By/s/Lyle R. Scritsmier
--------------------------
Lyle R. Scritsmier
Chief Financial Officer
On behalf of the registrant and as principal
financial officer.
11
<PAGE> 13
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit Description
- ------- -----------
<S> <C>
11 Computation of Earnings (Loss) per Share
27 Financial Data Schedule
</TABLE>
12
<PAGE> 1
EXHIBIT 11
PHARMACEUTICAL MARKETING SERVICES INC. AND SUBSIDIARIES
COMPUTATION OF EARNINGS (LOSS) PER SHARE
FOR THE THREE AND NINE MONTHS ENDED MARCH 31, 1996 AND 1995
<TABLE>
<CAPTION>
THREE MONTHS ENDED NINE MONTHS ENDED
------------------ -----------------
MARCH 31, MARCH 31, MARCH 31, MARCH 31,
--------- --------- --------- ---------
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
PRIMARY EARNINGS PER SHARE
Common shares outstanding 13,146,287 13,085,275 13,109,70 12,932,336
Assumed exercise of certain stock options 400,286 60,186 292,41 196,880
------------ ------------ ----------- ------------
13,546,573 13,145,461 13,402,12 13,129,216
============ ============ =========== ============
Income (loss) from continuing
operations (in thousands) $ (4,660) $ 2,138 $ (2,16) $ 3,553
Discontinued operations, net (in thousands) (7,162) 126 (8,91) (810)
------------ ------------ ----------- ------------
Net income (loss) (in thousands) $ (11,822) $ 2,264 $ (11,07) $ 2,743
============ ============ =========== ============
Primary income (loss) per share continuing $ (0.35) $ 0.16 $ (0.1) $ 0.27
Primary income (loss) per share discontinued (0.54) 0.01 (0.6) (0.06)
------------ ------------ ----------- ------------
Net income (loss) per share $ (0.89) $ 0.17 $ (0.8) $ 0.21
============ ============ =========== ============
FULLY DILUTED EARNINGS PER SHARE
Common shares outstanding 13,146,287 13,085,275 13,109,70 12,932,336
Assumed exercise of certain stock options 400,286 64,747 346,23 205,104
Assumed conversion of convertible
debentures -- -- -- --
------------ ------------ ----------- ------------
13,546,573 13,150,022 13,455,94 13,137,440
============ ============ =========== ============
Income (loss) from continuing
operations (in thousands) $ (4,660) $ 2,138 $ (2,16) $ 3,553
Discontinued operations, net (in thousands) (7,162) 126 (8,91) (810)
------------ ------------ ----------- ------------
Net income (loss) per share (in thousands) (11,822) 2,264 (11,07) 2,743
Reduction in interest expense
following conversion -- -- -- --
------------ ------------ ----------- ------------
Revised net income (loss) (in thousands) $ (11,822) $ 2,264 $ (11,07) $ 2,743
============ ============ =========== ============
Fully diluted income (loss) per share $ (0.89)(1) $ 0.17(1) $ (0.85)(1) $ 0.21(1)
============ ============ ============ ============
</TABLE>
1 Convertible debentures have not been assumed converted for the fully
diluted earnings per share as the effect would be anti-dilutive. Had the
convertible debentures been included, the number of shares would have been
increased by 3,450,000 to 16,996,573 and 16,600,022 for the three months
ended March 31, 1996 and 1995, respectively, and by 3,450,000 to 16,905,943
and 16,587,440 for the nine months ended March 31, 1996 and 1995,
respectively.
As a result of reduced interest expense following conversion, the increase
to net income (or decrease to net loss) would have been $647,000 for the
three months ended March 31, 1996 and 1995, respectively, and $1,941,000
for the nine months ended March 31, 1996 and 1995, respectively. These
adjustments would have resulted in fully diluted earnings per share of
($0.82), $0.18, ($0.54) and $0.28 for the three months ended March 31, 1996
and 1995 and the nine months ended March 31, 1996 and 1995, respectively.
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1996
<PERIOD-START> JUL-01-1995
<PERIOD-END> MAR-31-1996
<CASH> 20,193
<SECURITIES> 28,178
<RECEIVABLES> 24,029
<ALLOWANCES> 215
<INVENTORY> 3,023
<CURRENT-ASSETS> 89,422
<PP&E> 12,221
<DEPRECIATION> 2,939
<TOTAL-ASSETS> 169,330
<CURRENT-LIABILITIES> 26,449
<BONDS> 69,171
0
0
<COMMON> 87,053
<OTHER-SE> (14,308)
<TOTAL-LIABILITY-AND-EQUITY> 169,330
<SALES> 68,125
<TOTAL-REVENUES> 68,125
<CGS> 38,005
<TOTAL-COSTS> 65,183
<OTHER-EXPENSES> 4,682
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,047
<INCOME-PRETAX> (1,928)
<INCOME-TAX> 276
<INCOME-CONTINUING> (2,163)
<DISCONTINUED> (8,915)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (11,078)
<EPS-PRIMARY> (.85)
<EPS-DILUTED> (.85)
</TABLE>
