<PAGE> 1
================================================================================
UNITED STATES
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 JUNE 29, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM ________ TO ________.
COMMISSION FILE NUMBER 0-20083
----------------------
SPACELABS MEDICAL, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 91-1558809
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
15220 N.E. 40TH STREET, P.O. BOX 97013, REDMOND, WASHINGTON 98073
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (206) 882-3700
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
Common stock, par value $.01 per share: 10,009,960 shares outstanding
as of July 26, 1996
Page 1 of 12 sequentially numbered pages
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<PAGE> 2
SPACELABS MEDICAL, INC.
FORM 10-Q
FOR THE QUARTERLY PERIOD ENDED JUNE 29, 1996
TABLE OF CONTENTS
Page
----
PART I. Financial Information
Item 1. Financial Statements
Condensed Consolidated Balance Sheets
- June 29, 1996 (unaudited) and December 29, 1995........... 3
Condensed Consolidated Statements of Operations (unaudited)
- Three and Six Months Ended June 29, 1996 and July 1, 1995.. 4
Condensed Consolidated Statements of Cash Flows (unaudited)
- Six Months Ended June 29, 1996 and July 1, 1995............ 5
Notes to Condensed Consolidated Financial Statements .............. 6
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations ....................................... 7
PART II. Other Information
Item 1. Legal Proceedings................................................ . 11
Item 4. Submission of Matters to Vote of Security Holders.................. 11
Item 6. Exhibits and Reports on Form 8-K
There were no reports on Form 8-K filed during the three months ended
June 29, 1996 for which this report is filed.
(2)
<PAGE> 3
PART I.
Item 1. Financial Statements
SPACELABS MEDICAL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
-------------------------
June 29, December 29,
(in thousands) 1996 1995
- ------------------------------------------------------------------------------------------
(unaudited)
ASSETS
<S> <C> <C>
Current assets
Cash and short-term investments ..................... $ 40,976 $ 52,748
Receivables ......................................... 54,548 59,292
Inventories
Raw materials .................................. 19,758 15,728
Work in process ................................ 7,711 12,631
Finished products .............................. 17,731 13,733
Demonstration equipment ........................ 4,128 3,671
Customer service parts and equipment ........... 10,610 10,149
-------- --------
59,938 55,912
-------- --------
Prepaid expenses .................................... 1,451 2,154
Deferred income taxes ............................... 20,670 20,002
-------- --------
Total current assets ....................... 177,583 190,108
-------- --------
Property, plant and equipment, net ....................... 62,530 53,970
Other assets, net ........................................ 10,930 10,355
-------- --------
$251,043 $254,433
======== ========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Short-term borrowings ............................... $ 506 $ 250
Current portion of long-term debt ................... 750 750
Accounts payable and accrued expenses ............... 32,587 28,309
Deferred revenue .................................... 3,327 2,893
Taxes on income ..................................... 4,138 2,784
-------- --------
Total current liabilities .................. 41,308 34,986
-------- --------
Long-term debt ........................................... 13,875 14,250
Deferred income taxes .................................... 994 1,128
Shareholders' equity ..................................... 194,866 204,069
-------- --------
$251,043 $254,433
======== ========
- ----------------------------------------------------------------------------------------
Common shares outstanding ................................ 10,222 10,526
======== ========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
(3)
<PAGE> 4
SPACELABS MEDICAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
--------------------------------------------------------
June 29, July 1, June 29, July 1,
(in thousands, except per share data) 1996 1995 1996 1995
- ----------------------------------------------------------------------------------------------------------------
(unaudited)
<S> <C> <C> <C> <C>
Revenue .......................................... $ 62,374 $ 64,022 $ 125,677 $ 127,158
Cost of sales .................................... 30,996 31,075 62,420 61,624
--------- --------- --------- ---------
Gross margin ..................................... 31,378 32,947 63,257 65,534
--------- --------- --------- ---------
Operating expenses
Selling, general and administrative .. 18,483 18,436 37,415 36,348
Research and development ............. 7,154 7,734 14,484 15,510
Acquisition of in-process research and
development ........................ -- -- 8,797 --
Restructuring and reorganization ..... 3,323 337 4,002 725
--------- --------- --------- ---------
28,960 26,507 64,698 52,583
--------- --------- --------- ---------
Income (loss) from operations .................... 2,418 6,440 (1,441) 12,951
Other income (expense)
Interest income, net ................. 506 847 1,262 1,482
Other income (expense), net .......... (98) 14 (171) 20
--------- --------- --------- ---------
Income (loss) before income taxes ................ 2,826 7,301 (350) 14,453
Provision for income taxes ....................... 1,055 2,725 2,358 5,411
--------- --------- --------- ---------
Net income (loss) ................................ $ 1,771 $ 4,576 $ (2,708) $ 9,042
========= ========= ========= =========
Net income (loss) per share ...................... $ 0.17 $ 0.43 $ (0.26) $ 0.84
========= ========= ========= =========
- ----------------------------------------------------------------------------------------------------------------
Weighted average common shares
and equivalents outstanding .................... 10,424 10,733 10,602 10,754
========= ========= ========= =========
</TABLE>
See accompanying notes to condensed consolidated financial statements.
(4)
<PAGE> 5
SPACELABS MEDICAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Six Months Ended
-----------------------
June 29, July 1,
(in thousands) 1996 1995
- ---------------------------------------------------------------------------------------------------
(unaudited)
<S> <C> <C>
Operating activities
Net income (loss) ................................................ $ (2,708) $ 9,042
Adjustments to reconcile net income (loss) to net cash provided by
operating activities
Depreciation and amortization .............................. 4,013 4,507
Acquired in-process research and development ............... 2,087 --
Deferred income taxes ...................................... (802) (261)
Contribution to 401(k) plan in common stock ................ 372 447
Changes in operating assets and liabilities
(Increase) decrease in receivables ................... 4,646 (2,799)
(Increase) decrease in inventories ................... (4,099) 1,707
Decrease in prepaid expenses ......................... 701 1,062
Increase in accounts payable and accrued expenses .... 4,323 2,046
Increase (decrease) in deferred revenue .............. 415 (214)
Increase (decrease) in taxes on income ............... 1,315 (1,464)
Other ...................................................... 130 (378)
-------- --------
Cash provided by operating activities ................................ 10,393 13,695
-------- --------
Investing activities
Proceeds (purchases) of short-term investments, net .............. 28 (4,890)
Investment in property, plant and equipment ...................... (12,371) (5,941)
Purchase of equity investments ................................... (785) (1,930)
Proceeds from sale of assets ..................................... 9 2,075
Other, net ....................................................... -- 19
-------- --------
Cash used by investing activities .................................... (13,119) (10,667)
-------- --------
Effect of exchange rate changes on cash .............................. (25) 38
-------- --------
Financing activities
Change in short-term borrowings .................................. 256 --
Principal payments on long-term debt ............................. (375) (350)
Purchase of treasury stock ....................................... (9,459) (2,113)
Exercise of stock options ........................................ 584 386
-------- --------
Cash used by financing activities .................................... (8,994) (2,077)
-------- --------
Increase (decrease) in cash and cash equivalents ..................... (11,745) 989
Cash and cash equivalents at beginning of period ..................... 46,464 29,581
-------- --------
Cash and cash equivalents at end of period ........................... $ 34,719 $ 30,570
======== ========
</TABLE>
- -------------------------------------------------------------------------------
See accompanying notes to condensed consolidated financial statements.
(5)
<PAGE> 6
SPACELABS MEDICAL, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of Presentation
The accompanying condensed consolidated financial statements include the
accounts of SpaceLabs Medical, Inc. and its wholly owned subsidiaries,
collectively referred to as the "Company." The unaudited interim condensed
consolidated financial statements and related notes have been prepared pursuant
to the rules and regulations of the Securities and Exchange Commission.
Accordingly, certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been omitted pursuant to such rules and regulations. The
accompanying condensed consolidated financial statements and related notes
should be read in conjunction with the consolidated financial statements and
notes thereto included in the Company's 1995 Annual Report to Shareholders.
The information furnished reflects, in the opinion of management, all
adjustments, consisting of only normal recurring items, necessary for a fair
presentation of the results for the interim periods presented. Interim results
are not necessarily indicative of results for a full year.
2. Restructuring and Reorganization
During the second quarter of 1996, the Company recorded restructuring and
reorganization charges of $3.3 million related to the continuing consolidation
of its manufacturing and customer service operations. The Company expects to
incur restructuring costs related to these activities through the end of 1996.
3. Acquisition of in-process Research and Development
The Company completed its acquisition of JRS Clinical Technologies, Inc. and
formed a limited liability corporation with DSA Systems during the first quarter
of 1996. The Company has recorded a one-time, pre-tax charge of $8.8 million
related to the acquisition of in-process research and development in connection
with these investments.
4. Income per Share
Income per share is computed on the basis of the weighted average number of
common shares plus dilutive common equivalent shares outstanding during each
period. Dilutive common share equivalents are calculated under the treasury
stock method and consist of unexercised employee stock options.
(6)
<PAGE> 7
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
<TABLE>
<CAPTION>
RESULTS OF OPERATIONS
----------------------------------------------------------------------------------
Three Months Ended Six Months Ended
----------------------------------------------------------------------------------
June 29, July 1, Dollar Percent June 29, July 1, Dollar Percent
(dollars in millions, except per share data) 1996 1995 Change Change 1996 1995 Change Change
- --------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Revenue ........................... $ 62.4 $ 64.0 $ (1.6) (2.6%) $ 125.7 $ 127.2 $ (1.5) (1.2%)
Gross margin ...................... 31.4 32.9 (1.5) (4.8%) 63.3 65.5 (2.2) (3.5%)
As a % of revenue .............. 50.3% 51.5% 50.3% 51.5%
Operating expenses ................ 25.6 26.2 (0.6) (2.3%) 51.9 51.9 -- --
As a % of revenue .............. 41.1% 40.9% 41.3% 40.8%
Non-recurring operating expenses:
Acquired research and development -- -- -- -- 8.8 -- 8.8 --
Restructuring and reorganization 3.3 0.3 3.0 1,000.0% 4.0 0.7 3.3 471.4%
Provision for income taxes ........ 1.1 2.7 (1.6) (59.3%) 2.4 5.4 (3.0) (55.6%)
Effective tax rate .............. 37.3% 37.3% * 37.4%
Net income (loss) ................. $ 1.8 $ 4.6 $ (2.8) (61.3%) $ (2.7) $ 9.0 $ (11.7) (130.0%)
Net income (loss) per share ....... $ 0.17 $ 0.43 $ (0.26) (60.5%) $ (0.26) $ 0.84 $ (1.10) (131.0%)
Net income excluding non-recurring
items* ............................ $ 3.9 $ 4.8 $ (0.9) (19.5%) $ 7.8 $ 9.5 $ (1.70) (17.9%)
Net income per share excluding non-
recurring items* .................. $ 0.37 $ 0.45 $ (0.08) (17.8%) $ 0.74 $ 0.89 $ (0.15) (16.9%)
- --------------------------------------------------------------------------------------------------------------------------------
</TABLE>
*Refer to Taxes and Net Income below
Revenue
In the second quarter of 1996, total revenue of $62.4 million declined 2.6%
compared to the $64.0 million reported in the same quarter last year. This
decline was largely attributable to a 6.7% contraction in U.S. revenue compared
to the same quarter last year. Increases in international revenues of 6.1% over
the second quarter of 1995 partially offset this decline. International revenue
represented 34.9% of total revenue in the second quarter of 1996 compared to
32.1% in the same period of 1995.
Year-to-date revenue of $125.7 million represents a 1.2% decline compared to
$127.2 million last year. The overall revenue decline was attributable to the
contracting U.S. market and the resulting decline in unit sales and continued
pressure on prices. International revenue increased 15.4% to $43.6 million in
1996 from $37.8 million in 1995 and represented 34.7% of total revenue for the
first six months of 1996, compared to 29.7% for the same period in 1995.
Although international revenue has partially offset the declines in the U.S.
market, international markets are very competitive and revenue is volatile and
difficult to predict from quarter to quarter. Uncertainties also arise in the
timing of international revenue due to the need for foreign governmental
approvals and more complex international financing arrangements.
(7)
<PAGE> 8
Gross Margin
Gross margin for the quarter and year-to-date was 50.3% of revenue in 1996
compared to 51.5% in both the second quarter and first six months of 1995.
Aggressive pricing in the highly competitive worldwide market has put pressure
on product margins, and the Company expects to see this trend continue.
Operating Expenses Excluding Non-recurring Items
Operating expenses, excluding non-recurring items, consist of selling, general
and administrative, and research and development costs which declined 2.3% from
$26.2 million in the second quarter of 1995 to $25.6 million in 1996.
Year-to-date these expenses remained constant at $51.9 million in both 1996 and
1995.
For the quarter, selling, general and administrative expenses remained
relatively constant at $18.5 million in 1996 and $18.4 million in 1995.
Year-to-date these expenses were $37.4 million and $36.3 million, representing
29.7% and 28.5% of year-to-date revenues in 1996 and 1995, respectively. This
increase is attributable to the expansion of the Company's international
operations and clinical information systems sales and marketing efforts.
Research and development expenses were $7.2 million in the second quarter of
1996, a decline of 6.5% from the $7.7 million incurred in the same quarter last
year. On a year-to-date basis, these expenses were $14.5 million in 1996 and
$15.5 million in 1995 and represented 11.5% and 12.2% of revenues, respectively.
Research and development expenditures have typically ranged between 11% and 12%
of revenue and management expects this level of expenditures to continue.
Non-Recurring Operating Expenses
For the second quarter of 1996, the Company incurred pre-tax restructuring and
reorganization charges of $3.3 million which primarily related to the relocation
of its Chatsworth, California and Hillsboro, Oregon operations to its new
Redmond, Washington facility. For the year, restructuring and reorganization
expenses were $4.0 million. The Company anticipates an additional $2.5 million
will be required to complete the consolidation by the end of 1996 and
anticipates annual cost savings of approximately $2.0 million as a result of
this consolidation.
As previously announced, the Company expensed $8.8 million of in-process
research and development in the first quarter of 1996 related to its acquisition
of JRS Clinical Technologies, Inc. and its investment with DSA Systems.
(8)
<PAGE> 9
Other Income (Expense)
Net interest income for the second quarter of 1996 declined to $506,000 from
$847,000 in 1995. Year-to-date interest income totaled $1.3 million in 1996
versus $1.5 million in 1995. The decrease in interest income is the result of
lower invested cash balances and a decrease in the rate of return, partially
offset by interest expense of $431,000 capitalized on the Company's new Redmond,
Washington facility in 1996. Also during the quarter, the Company recognized a
$98,000 loss from foreign currency exchange rate fluctuations versus a $33,000
gain in the second quarter of 1995. Year-to- date, the Company has recognized a
$174,000 loss from foreign exchange versus a $182,000 gain in 1995.
Taxes and Net Income
The effective tax rate was 37.3% in the first quarters of both 1996 and 1995.
Year-to-date, the Company has incurred income tax expense of $2.4 million on a
pre-tax loss of $350,000 because a substantial portion of acquired in-process
research and development costs, incurred in the first quarter of 1996, is not
deductible for tax purposes. As a result, the Company's year-to-date effective
tax rate was not meaningful. The effective tax rate for the first six months of
1995, was 37.4%, reflecting the mix of federal, state and foreign tax rates.
Net income for the quarter was $3.9 million or $0.37 per share excluding pre-tax
restructuring and reorganization charges of $3.3 million. In the same quarter
last year, net income was $4.8 million or $0.45 per share excluding
restructuring charges of $337,000. Including these charges, the Company
generated net income of $1.8 million or $0.17 per share and $4.6 million or
$0.43 per share in the second quarter of 1996 and 1995, respectively.
On a year-to-date basis, the Company generated net income of $7.8 million or
$0.74 per share excluding restructuring and reorganization charges of $4.0
million and the one-time $8.8 million charge discussed above. In 1995, net
income was $9.5 million or $0.89 per share excluding restructuring charges of
$725,000. Including these charges, the Company incurred a net loss of $2.7
million or $0.26 per share for the first six months of 1996 compared to net
income of $9.0 million or $0.84 per share in 1995.
CAPITAL RESOURCES & LIQUIDITY
<TABLE>
<CAPTION>
------------------------------------------------
June 29, December 29, Dollar Percent
(dollars in millions) 1996 1995 Change Change
- ---------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Cash and short-term investments $ 41.0 $ 52.7 $(11.7) (22.2)%
Working capital ............... 136.3 155.1 (18.8) (12.1)%
Long-term debt ................ 13.9 14.3 (0.4) (2.8)%
Shareholders' equity .......... 194.9 204.1 (9.2) (4.5)%
- --------------------------------------------------------------------------------------
</TABLE>
(9)
<PAGE> 10
Capital Resources and Liquidity
At June 29, 1996, cash and short-term investments totaled $41.0 million compared
to $52.7 million at December 29, 1995. The short-term investment portfolio is
invested among diversified security types and issuers, and it does not include
any derivative products. During the first six months of 1996, the Company
generated $16.7 million in cash from operations, excluding cash paid to acquire
in-process research and development, compared to $13.7 million during the same
period in 1995. Including in-process research and development expenditures, the
Company generated $10.4 million from operations during the first six months of
1996. At June 29, 1996, the Company's working capital was $136.3 million,
compared to $155.1 million at December 29, 1995. The overall decrease in cash
results from the investing and financing activities described below.
The Company invested $12.4 million in property, plant and equipment during the
first six months of 1996 compared with $5.9 million in the same period last
year. Of these expenditures, $8.0 million was related to construction of the
Company's new facility located in Redmond, Washington, which was substantially
complete by the end of the second quarter of 1996. Other significant uses of
cash during 1996 included the purchase of 375,200 shares of the Company's common
stock for $9.5 million.
The Company continues to make monthly payments of $62,500 on its outstanding
long-term debt of $14.6 million, which is due in total in December, 2002.
Interest on this debt accrues at 6.66%. The Company has available $16.0 million
of domestic lines of credit as well as several small credit lines to meet the
operating requirements of its international subsidiaries.
Management believes that existing cash and short-term investments and cash flow
from operations, together with available credit lines, will continue to be
sufficient to meet ongoing operating requirements as well as the Company's
investment in capital additions and research and development activities. In
connection with research and development, cash may be used from time to time to
acquire technology or to fund strategic ventures.
In June 1993, the Board of Directors approved the repurchase of up to 1,000,000
shares of the Company's common stock in the open market, subject to certain
limitations and conditions. Through the second quarter of 1996, all shares under
this program have been purchased. In November 1995, the Board of Directors
approved a second share repurchase program of up to 1,000,000 shares. Through
the second quarter of 1996, 111,200 shares have been purchased under this second
share repurchase program. Shares acquired under these programs are being used to
service the Company's various employee benefit plans and for other purposes the
Company may deem appropriate.
Forward Looking Information
Private Securities Litigation Reform Act of 1995 Compliance Statement:
Statements contained in this report that are not based on historical facts are
forward-looking statements subject to uncertainties and risks including, but not
limited to: product and service demand and acceptance, economic conditions, the
impact of competition and pricing, capacity and supply constraints or
difficulties, and other risks detailed in the Company's Securities and Exchange
Commission filings.
(10)
<PAGE> 11
PART II.
Item 1. Legal Proceedings
On March 31, 1995, a lawsuit was filed against the Company by Baby's Benefit
International, Inc., in federal court in Denver, Colorado, alleging various
claims relating to breach of contract, trade secret misappropriation, and other
tortious conduct, all relating to certain software developed by a third party
software development contractor, at the Company's expense. In July, this
litigation was amicably resolved between the parties on terms which SpaceLabs
believes will be favorable, but not material, to its operations. In connection
with this settlement, there was no admission of liability or wrongdoing by
either party.
Item 4. Submission of Matters to a Vote of Security Holders
The annual meeting of SpaceLabs Medical, Inc.'s shareholders was held on May 9,
1996. The following proposals were submitted to a vote:
a) The election of seven directors, each to hold office for a term of one year,
each of whom were previously a director of SpaceLabs Medical, Inc. This
proposal passed with the following number of votes:
<TABLE>
<CAPTION>
Affirmative Abstentions
----------- -----------
<S> <C> <C>
Gilbert W. Anderson 9,330,211 39,739
Thomas J. Dudley, D.B.A. 9,331,351 38,599
Harvey Feigenbaum, M.D. 9,330,669 39,281
Dennis C. Fill 9,329,928 40,022
Carl A. Lombardi 9,324,543 45,407
Phillip M. Nudelman, Ph.D. 9,331,235 38,715
Harry Woolf, Ph.D. 9,330,211 39,739
</TABLE>
b) Approval of Amendments to the SpaceLabs Medical, Inc. Stock Option and
Deferral Plan for Nonemployee Directors. This proposal passed with 7,609,375
affirmative votes, 1,655,122 negative votes, and 105,453 abstentions.
c) Ratification of the appointment of KPMG Peat Marwick LLP as auditors for
SpaceLabs Medical, Inc. for 1996. This proposal passed with 9,331,431
affirmative votes, 20,937 negative votes, and 17,582 abstentions.
(11)
<PAGE> 12
SIGNATURE
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.
SPACELABS MEDICAL, INC.
(Registrant)
DATE: August 8, 1996 BY: /s/ Carl A. Lombardi
-----------------------------------
Carl A. Lombardi
Chairman of the Board and
Chief Executive Officer
BY: /s/ James A. Richman
-----------------------------------
James A. Richman
Vice President and
Corporate Controller
(12)
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-27-1996
<PERIOD-START> DEC-30-1995
<PERIOD-END> JUN-29-1996
<CASH> 34,719
<SECURITIES> 6,257
<RECEIVABLES> 56,262
<ALLOWANCES> 1,714
<INVENTORY> 59,938
<CURRENT-ASSETS> 177,583
<PP&E> 113,589
<DEPRECIATION> 51,059
<TOTAL-ASSETS> 251,043
<CURRENT-LIABILITIES> 41,308
<BONDS> 13,875
0
0
<COMMON> 113
<OTHER-SE> 194,753
<TOTAL-LIABILITY-AND-EQUITY> 251,043
<SALES> 125,677
<TOTAL-REVENUES> 125,677
<CGS> 62,420
<TOTAL-COSTS> 62,420
<OTHER-EXPENSES> 63,607
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (350)
<INCOME-TAX> 2,358
<INCOME-CONTINUING> (2,708)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (2,708)
<EPS-PRIMARY> (0.26)
<EPS-DILUTED> (0.26)
</TABLE>
