<PAGE> 1
UNITED STATES
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, 1997
--------------
Commission File No. 0-20618
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RAILAMERICA, INC.
-----------------------------------------------------------------
(Exact name of small business issuer as specified in its charter)
DELAWARE 65-0328006
------------------------------ -------------------
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
301 Yamato Road, Suite 1190, Boca Raton, Florida 33431
------------------------------------------------------
(Address of principal executive offices)
(Zip Code)
(561) 994-6015
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(Issuer's telephone number)
Check whether the registrant (1) 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 XX No
-- --
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of shares outstanding of each of the issuer's classes of common
stock, as of the latest practicable date:
Common Stock, par value $.001 - 8,428,229 shares as of May 19, 1997
<PAGE> 2
RAILAMERICA, INC. AND SUBSIDIARIES
INDEX TO FORM 10-Q
QUARTER ENDED MARCH 31, 1997
<TABLE>
<CAPTION>
Page No.
--------
<S> <C>
PART I FINANCIAL INFORMATION
Item 1 Financial Statements
Consolidated Balance Sheets - March 31, 1997
and December 31, 1996 1
Consolidated Statements of Income - For the
three months ended March 31, 1997 and 1996 2
Consolidated Statements of Cash Flows - For the
three months ended March 31, 1997 and 1996 3
Notes to Consolidated Financial Statements 4
Item 2 Management's Discussion and Analysis of
Financial Condition and Results of Operations 7
PART II OTHER INFORMATION
Item 6 Exhibits and Reports on Form 8-K 17
Signatures
</TABLE>
<PAGE> 3
RAILAMERICA, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
------------ -------------
(Unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash $ 1,472,740 $ 3,879,972
Accounts receivable 4,968,643 4,575,958
Inventories 3,313,975 3,104,555
Other current assets 583,071 462,867
----------- ------------
Total current assets 10,338,429 12,023,352
Property, plant and equipment, net 54,511,587 54,148,966
Investment in and advances to majority-owned subsidiary 7,559,558 --
Other, net 2,314,892 2,426,615
Excess of cost over net assets of companies acquired, net 2,928,693 2,965,853
------------ ------------
Total assets $ 77,653,159 $ 71,564,786
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current maturities of long-term debt $ 1,708,497 $ 1,752,926
Current maturities of subordinated debt 212,392 212,392
Accounts payable 3,630,010 3,162,953
Accrued expenses and income taxes payable 1,830,881 1,811,739
----------- ------------
Total current liabilities 7,381,780 6,940,010
------------ ------------
Long-term debt, less current maturities 37,487,989 38,401,119
------------ ------------
Subordinated debt, less current maturities 3,424,784 3,477,882
------------ ------------
Deferred income taxes 6,986,687 6,753,668
------------ ------------
Commitments and contingencies
Redeemable convertible preferred stock, $.001 par value, 1,000,000 -- --
shares authorized
Stockholders' equity:
Common stock, $.001 par value, 30,000,000 shares authorized;
8,225,317 issued and 7,988,317 outstanding at March 31, 1997;
6,125,410 issued and 5,888,410 outstanding at December 31, 1996 8,225 6,125
Additional paid-in capital 20,193,166 11,773,036
Common stock subscribed -- 2,340,000
Retained earnings 3,232,626 2,944,774
Cumulative translation adjustment 77,171 67,441
Less treasury stock (237,000 shares at cost) (1,139,269) (1,139,269)
------------ ------------
Total stockholders' equity 22,371,919 15,992,107
------------ ------------
Total liabilities and stockholders' equity $ 77,653,159 $ 71,564,786
============ ============
</TABLE>
The accompanying notes are an integral part of
the consolidated financial statements.
1
<PAGE> 4
RAILAMERICA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
For the three months ended March 31, 1997 and 1996
(Unaudited)
<TABLE>
<CAPTION>
1997 1996
----------- -----------
<S> <C> <C>
Operating revenues:
Transportation - railroad $ 3,631,671 $ 2,593,914
Manufacturing 4,074,019 3,453,214
Other 351,622 96,984
----------- -----------
8,057,312 6,144,112
----------- -----------
Operating expenses:
Transportation - railroad 1,502,697 999,383
Cost of goods sold - manufacturing 3,121,049 2,630,935
Selling, general and administrative 1,628,505 1,206,011
Depreciation and amortization 518,532 367,640
----------- -----------
6,770,783 5,203,969
----------- -----------
Operating income 1,286,529 940,143
Equity in income of majority-owned subsidiary 23,760 --
Interest expense (709,434) (403,958)
Other expenses (43,074) (20,666)
----------- -----------
Income from continuing operations before
income taxes 557,781 515,519
Provision for income taxes 208,250 190,742
----------- -----------
Income from continuing operations 349,531 324,777
Discontinued operations
Loss from operations of discontinued Motor
Carrier segment (less applicable income tax
benefit of $38,000 and $66,000, respectively) (61,680) (112,970)
----------- -----------
Net Income $ 287,851 $ 211,807
=========== ===========
Primary earnings per common share
Continuing operations $ 0.04 $ 0.07
Discontinued operations (0.00) (0.02)
----------- -----------
Net income $ 0.04 $ 0.05
=========== ===========
Fully diluted earnings per common share
Continuing operations $ 0.04 $ 0.07
Discontinued operations (0.00) (0.02)
----------- -----------
Net income $ 0.04 $ 0.05
=========== ===========
Weighted average common shares and common
share equivalents outstanding:
Primary 8,198,160 4,680,141
=========== ===========
Fully diluted 8,198,160 5,489,542
=========== ===========
</TABLE>
The accompanying notes are an integral part of
the consolidated financial statements.
2
<PAGE> 5
RAILAMERICA, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the three months ended March 31, 1997 and 1996
(Unaudited)
<TABLE>
<CAPTION>
1997 1996
----------- -----------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 287,851 $ 211,807
Adjustments to reconcile net income to net
cash provided by (used in) operating activities:
Depreciation and amortization 660,204 508,585
Equity in income of affiliated company (23,760) --
Sale of properties -- 70,465
Employee stock grants -- 48,554
Deferred income taxes 233,019 90,254
Changes in operating assets and liabilities, net of acquisitions:
Accounts receivable (392,685) (834,420)
Inventories (209,420) (697,999)
Other current assets (120,204) 73,675
Accounts payable 467,057 726,310
Income taxes payable -- (400,000)
Accrued liabilities 19,142 (321,628)
Deposits and other 7,568 (96,830)
------------ ------------
Net cash provided by (used in) operating activities 928,772 (621,227)
------------ ------------
Cash flows from investing activities:
Purchase of property, plant and equipment (881,096) (1,481,478)
Acquisition of 55% of Ferronor (7,445,701) --
Deferred acquisition costs and other (70,453) (101,746)
------------ ------------
Net cash used in investing activities (8,397,250) (1,583,224)
------------ ------------
Cash flows from financing activities:
Proceeds from issuance of long-term debt and capital leases 9,894,800 3,450,479
Principal payments on debt and capital leases (10,905,457) (3,202,430)
Sale of common stock 6,176,999 --
Deferred financing costs (89,030) --
Deferred loan costs (16,066) (5,697)
------------ ------------
Net cash provided by financing activities 5,061,246 242,352
------------ ------------
Net decrease in cash (2,407,232) (1,962,099)
Cash, beginning of period 3,879,972 3,488,866
------------ ------------
Cash, end of period $ 1,472,740 $ 1,526,767
============ ============
</TABLE>
The accompanying notes are an integral part
of the consolidated financial statements.
3
<PAGE> 6
RAILAMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
1 BASIS OF PRESENTATION:
The consolidated financial statements included herein have been
prepared by the Company, without audit, pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain
information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such rules and
regulations.
In the opinion of Management, the consolidated financial statements
contain all adjustments which are those of a recurring nature, and
disclosures necessary to present fairly the financial position of the
Company as of March 31, 1997 and December 31, 1996, and the results of
operations and cash flows for the three months ended March 31, 1997 and
1996.
On February 19, 1997, the Company acquired a 55% equity interest in
Empresa de Transporte Ferrovario S.A. ("Ferronor"). The Company has
accounted for its interest in Ferronor using the equity method.
The accounting principles which materially affect the financial
position, results of operations and cash flows of the Company are set
forth in Notes to the Consolidated Financial Statements which are
included in the Company's financial statements contained in the
Company's 1996 annual report on Form 10-KSB. Capitalized terms used but
not otherwise defined herein have the meanings set forth in the
Company's annual report on Form 10-KSB.
2 EARNINGS PER SHARE:
For the three months ended March 31, 1997, primary and fully diluted
earnings per share are based on the weighted average number of common
and common equivalent shares outstanding during the three month period
under the modified treasury stock method. The convertible notes payable
are anti-dilutive and have been excluded from weighted average number
of shares outstanding for fully diluted earnings per share.
4
<PAGE> 7
RAILAMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
2 EARNINGS PER SHARE, continued
For the three months ended March 31, 1996, primary earnings per share
is based on the weighted average number of common shares outstanding
during the three month period. Fully diluted earnings per share was
computed, in addition to the above computation, assuming the conversion
of the convertible subordinated notes payable and using the higher of
the average market price or the end of the quarter market price. The
stock options and warrants outstanding are anti-dilutive and have been
excluded from weighted average number of shares outstanding for both
primary basic and fully diluted earnings per share.
3. INVESTMENT IN AND ADVANCES TO MAJORITY-OWNED SUBSIDIARY:
Included in the Company's continuing operations at March 31, 1997 is an
equity interest of 55% in Ferronor, a railroad serving northern Chile
with approximately 1,400 miles of rail line. Ferronor's functional
currency is the Chilean Peso.
A summary of financial information of Ferronor as of and for the one
month period ended March 31, 1997 is set forth below:
<TABLE>
<S> <C> <C>
Current assets $ 5,272,000
Noncurrent assets 16,216,000
----------
Total assets 21,488,000
----------
Current liabilities 8,200,000
Noncurrent liabilities 180,000
-----------
Total liabilities 8,380,000
----------
Net assets $ 13,108,000
==========
Railroad revenue $ 677,000
===========
Net income $ 43,200
============
</TABLE>
5
<PAGE> 8
RAILAMERICA, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
4 INVENTORIES:
Inventories consist of the following as of March 31, 1997 and December
31, 1996:
<TABLE>
<CAPTION>
1997 1996
------------ -------------
<S> <C> <C>
Raw materials $ 3,366,156 $ 2,284,683
Work in process 881,033 635,780
Finished goods 954,862 881,817
Replacement or repair parts for equipment
and road property 465,368 381,309
------------ -----------
5,667,419 4,183,589
Less, advances related to materials (2,353,444) (1,079,034)
------------ ------------
Inventories in excess of contract advances $ 3,313,975 $ 3,104,555
============ ============
</TABLE>
5. INCOME TAX PROVISION:
The difference between the U.S. federal statutory tax rate and the
Company's effective rate from continuing operations is primarily due
to the Chilean tax rate on income from Ferronor.
6
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
GENERAL
RailAmerica, Inc. (together with its consolidated subsidiaries, the
"Company") is a multi- modal transportation company that acquires, develops and
operates shortline railroads formed primarily through the acquisition of light
density rail lines from larger railroads. The Company has expanded its
operations in the transportation industry through its acquisition of
Kalyn/Siebert, Inc. ("Kalyn"), a manufacturer of a broad range of truck
trailers, located in Gatesville, Texas. Through Kalyn, the Company has
established trailer manufacturing operations and substantially increased the
Company's assets, liabilities, revenue, expenses and income.
The Company's objectives are to create a diversified transportation
company by acquiring additional railroads and other transportation-related
companies. In accordance with this strategy, in February 1997, the Company
purchased a majority interest in the stock of Empresa de Transporte Ferrovario
S.A. ("Ferronor"), a railroad serving northern Chile with approximately 1,400
miles of rail line.
Set forth below is a discussion of the results of operations for the
Company's railroad operations, trailer manufacturing operations and motor
carrier operations (discontinued operations). The corporate overhead, which
benefits all of the Company's segments, has not been allocated to the business
segments for this analysis. The Company feels that this presentation will
facilitate a better understanding of the changes in the results of the Company's
operations. Corporate overhead increased by approximately $95,000 (or 17.6%) to
$634,279 in the three month period ended March 31, 1997 compared to $539,551 for
the prior year period. The increase was related to the additional costs incurred
to manage the new subsidiaries acquired during 1996 and 1997 including
Evansville Terminal Company ("ETC"), Cascade and Columbia River Railroad
Company, Inc. ("CCRR"), Otter Tail Valley Railroad Company, Inc. ("OTVR"),
Gettysburg Railway, Minnesota Northern Railroad, Inc. ("MNR") and Ferronor.
RAILROAD OPERATIONS
The Company's railroad subsidiaries operated approximately 2,330 miles
of rail line as of March 31, 1997. Currently, these consist of: (i) 136 miles of
rail line which it owns in Michigan; (ii) 4 miles of trackage rights and 45
miles of rail line which are owned by the State of Michigan and operated
pursuant to an agreement with Michigan Department of Transportation; (iii) 49
miles of rail line leased from the South Central Tennessee Railroad Authority
near Nashville, Tennessee and 3 miles of trackage rights; (iv) 45 miles of rail
line in Pennsylvania, 18 miles of which the Company has agreed to purchase from
the Commonwealth of Pennsylvania for a price to be determined and 27 miles of
which are operated under a freight easement with the Commonwealth of
Pennsylvania; (v) 10 miles of rail line in Delaware made available to the
Company pursuant to a ten-year lease with the Wilmington & Northern Railroad
Company; (vi) 44 miles of rail line which the Company is operating pursuant to a
contract with the State of
7
<PAGE> 10
Minnesota; (vii) 104 miles of rail line and 4 miles of trackage rights in West
Texas; (viii) 51 miles of rail line in the state of Indiana, 18 miles of which
it owns and 33 miles of which it operates under an operating agreement; (ix) 131
miles of rail line which it owns in the state of Washington; (x) 23 miles of
rail line which it owns in southern Pennsylvania; (xi) 72 miles of rail line
which it owns in central Minnesota; (xii) 174 miles of rail line it owns in
northern Minnesota and 37 miles of trackage rights; and (xiii) 1,400 miles of
rail line in northern Chile.
The Company provides its customers with local rail freight services
with access to the nation's rail system for delivery of products both
domestically and internationally. The Company hauls varied products for its
customers based upon market demands in its local operating areas. The Company's
haulage of products in Michigan include agricultural commodities, automotive
parts, chemicals and fertilizer, ballast and other stone products. The Company's
haulage of products in Tennessee includes wood chips, paper, chemicals and
processed food products. The Company's haulage of products in Pennsylvania and
Delaware includes iron and steel products, chemicals, agricultural products,
lumber and processed food products. The Company's haulage of products in
Minnesota includes plastics, lumber, denatured alcohol, scrap iron and steel.
The Company's haulage of products in Texas consists of cotton, sodium sulfate,
chemicals, fertilizer, scrap iron and steel. The Company's haulage of products
in Indiana consists of agricultural commodities and plastics. The haulage of
products in Washington consists of wood chips, lumber, minerals, cement and
various agricultural products. The haulage of products in Chile consists of
copper, iron ore, limestone and other commodities.
In keeping with the general nature of business in its Michigan, Texas
and Minnesota market area, agricultural commodities have represented a
significant portion of the Company's annual carloadings. Although the
acquisitions of South Central Tennessee Railroad Corporation ("SCTR"), Delaware
Valley Railway Company ("DVRC"), Dakota Rail, Inc. ("DRI"), West Texas and
Lubbock Railroad Company, Inc. ("WTLR") and Plainview Terminal Company ("PTC")
and CCRR have helped to diversify the Company's traffic base and mitigate
seasonal fluctuations, the Company believes that, absent additional acquisitions
in industrial areas, agricultural commodities will continue to represent the
primary component of the Company's rail traffic base. As a result, the Company's
operations could be materially and adversely affected by factors such as adverse
weather conditions and fluctuations in grain prices. The Company anticipates
that in the future the acquisition of Ferronor will help insulate it from its
dependence on agricultural commodities. Additionally, sellers of commodities
tend to hold shipments if they anticipate price increases for their commodities.
Such actions could cause the Company's results of operations to fluctuate from
period to period as a result of fluctuations in the prices of those commodities.
Moreover, agricultural commodities are generally shipped from September to May
and the Company handles most of its traffic during such periods.
RESULTS OF RAILROAD OPERATIONS
The discussion of results of operations that follows reflects the
consolidated results of the Company's Railroad Operations for the three months
ended March 31, 1997 and March 31, 1996. The results of railroad operations
include the operations of ETC effective July 1, 1996, CCRR
8
<PAGE> 11
from September 6, 1996, OTVR from October 1, 1996, Gettysburg Railway from
November 1, 1996 and MNR from December 28, 1996. As a result, the results of
operations for the three months ended March 31, 1997 are not comparable to the
prior year period in certain material respects.
COMPARISON OF OPERATING RESULTS FOR THE THREE MONTHS ENDED
MARCH 31, 1997 AND 1996
The table below compares the components of the Company's revenues from
its railroad operations for the periods shown.
<TABLE>
<CAPTION>
For the Three Months Ended
----------------------------------------------------------
March 31, 1997 March 31, 1996
------------------------- ------------------------
Gross % Change Gross % Change
Revenues From 1996 Revenues From 1995
-------- --------- -------- ---------
<S> <C> <C> <C> <C>
Transportation Revenue $3,631,671 40.0% $2,593,914 67.8%
Other Revenue 257,002 221.9% 79,850 339.8%
--------- ----------
Total Revenue $3,888,673 45.4% $2,673,764 69.2%
========== ==========
</TABLE>
TRANSPORTATION REVENUES. Transportation revenues for the three month
period ended March 31, 1997 increased by $1.0 million, or 40.0%, compared to the
prior year period primarily due to the acquisitions which occurred during the
second half of 1996. CCRR, which was acquired in September 1996, had revenue of
approximately $0.6 million in the first quarter of 1997. MNR, which was acquired
in December 1996, had revenue of approximately $0.5 million in the first quarter
of 1997. OTVR, which was acquired in September 1996, had revenue of
approximately $0.4 million during the first quarter of 1997. These increases in
transportation revenue were partially offset by a decrease of approximately $0.3
million in revenue from HESR due to a decrease in the agricultural shipments in
the first quarter of 1997 compared to the first quarter of 1996. Additionally,
transportation revenue from WTLR decreased approximately $179,000 due to a
decrease in inbound shipments. The net increase in total revenues for the three
month period ended March 31, 1997 was comprised of an increase in both
transportation revenue and other revenue. The transportation revenue per carload
decreased from $395 to $327 per car primarily due to the acquisitions during
1996 of railroads with lower rates per carload than the Company's other
railroads. Carloads handled totaled 11,101 for the three months ended March 31,
1997, an increase of 4,535, or 69.1% compared to 6,566 carloads in the prior
year period. The increase was primarily the result of the acquisitions of MNR,
which handled 2,389 in the first quarter of 1997, CCRR, which handled 1,757
carloads in the first quarter of 1997, OTVR, which handled 1,281 carloads in the
first quarter of 1997 and Gettysburg Railway, which handled 353 carloads in the
first quarter of 1997. These increased carloadings were partially offset by
decreases of 770 carloads from HESR and 489 carloads from WTLR and PTC.
OTHER REVENUES. Other revenues increased by $177,152, or 221.9%, from
$79,850 for the three months ended March 31, 1996 to $257,002 for the three
months ended March 31, 1997.
9
<PAGE> 12
Other revenues for the three months ended March 31, 1997 and 1996 primarily
represented rental of locomotives and real estate, sales of surplus rail and
material, certain miscellaneous assets and non-operating real estate. The
increase was primarily the result of sale of easements of approximately $90,000
during the first quarter of 1997 and increased rental income of approximately
$50,000.
OPERATING EXPENSES. The table below is a comparison of operating
expenses (which do not include interest expense and other expense) for the
periods shown.
<TABLE>
<CAPTION>
For the Three Months Ended
-----------------------------------------
March 31, 1997 March 31, 1996
-------------- --------------
% Change % Change
Expenses From 1996 Expenses From 1995
-------- --------- -------- ---------
<S> <C> <C> <C> <C>
Maintenance of way $ 514,777 68.4% $ 305,614 81.5%
Maintenance of equipment 193,823 14.4% 169,363 122.2%
Transportation 790,144 35.4% 510,198 40.3%
Equipment rental 3,953 (72.2%) 14,208 522.4%
Selling, general and
administrative 559,258 89.9% 294,474 99.9%
Depreciation and
amortization 363,801 46.3% 248,692 38.0%
---------- ----------
Total operating expenses $2,425,756 57.3% $1,542,549 100.3%
========== ==========
</TABLE>
Operating expenses increased by approximately $0.9 million, or 57.3%,
from $1.5 million for the three month period ended March 31, 1996 to $2.4
million for the three month period ended March 31, 1997. Maintenance of way
expenses increased by approximately $209,000, or 68.4%, from $305,614 for the
three month period ended March 31, 1996 to $514,777 for the three month period
ended March 31, 1997 primarily due to certain acquisitions which occurred during
the second half of 1996. MNR, which was acquired in December 1996, had
maintenance of way expenses of approximately $64,000 for the three months ended
March 31, 1997. CCRR, which was acquired September 1996, had maintenance of way
expenses of approximately $52,000 for the three months ended March 31, 1997.
Gettysburg Railway, which was acquired in November 1996, had maintenance of way
expenses of approximately $30,000 for the three months ended March 31, 1997. In
addition to the above acquisitions, WTLR's maintenance of way expenses increased
approximately $34,000 from the first quarter of 1996 to the first quarter of
1997 due to increased track work being performed as part of a maintenance
program.
Maintenance of equipment expenses increased by approximately $24,000,
or 14.4%, from $169,363 for the three month period ended March 31, 1996 to
$193,823 for the three month
10
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 1,472,740
<SECURITIES> 0
<RECEIVABLES> 4,968,643
<ALLOWANCES> 0
<INVENTORY> 3,313,975
<CURRENT-ASSETS> 10,338,429
<PP&E> 54,511,587
<DEPRECIATION> 0
<TOTAL-ASSETS> 77,653,159
<CURRENT-LIABILITIES> 7,381,780
<BONDS> 37,487,989
0
0
<COMMON> 8,225
<OTHER-SE> 22,363,694
<TOTAL-LIABILITY-AND-EQUITY> 77,653,159
<SALES> 4,074,019
<TOTAL-REVENUES> 8,057,312
<CGS> 3,121,049
<TOTAL-COSTS> 6,770,783
<OTHER-EXPENSES> 19,314
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 709,434
<INCOME-PRETAX> 557,781
<INCOME-TAX> 208,250
<INCOME-CONTINUING> 349,531
<DISCONTINUED> (61,680)
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 287,851
<EPS-PRIMARY> 0.04
<EPS-DILUTED> 0.04
</TABLE>
