UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(X) QUARTERLY REPORT UNDER 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
For the transition period from _____ to _____
Commission File number 1-11278
THE DEWOLFE COMPANIES, INC.
(Exact name of registrant as specified in its charter)
MASSACHUSETTS 04-2895334
------------- ----------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
80 Hayden Avenue
Lexington, MA 02173
------------- -----
(Address of principal executive offices) (Zip Code)
(617) 863-5858
--------------
(Registrant's telephone number, including area code)
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 twelve months, and (2) has been subject to such filing
requirements for the past 90 days. Yes X No
----- -----
Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date (October 31, 1997):
Common Stock, par value $.01 per share 3,246,509 shares.
Page 1 of 16 pages, Exhibit Index appears on Page 11.
<PAGE>
-2-
THE DEWOLFE COMPANIES, INC.
INDEX
<TABLE>
<CAPTION>
PART I. FINANCIAL INFORMATION PAGE NO.
<S> <C> <C>
Item 1. Financial Statements (Unaudited)
Condensed Consolidated Balance Sheets as of
September 30, 1997 and December 31, 1996 3
Condensed Consolidated Statements of Income for the Three
Months and Nine Months ended September 30, 1997 and September 30, 1996 4
Condensed Consolidated Statements of Cash Flows for
the Nine Months ended September 30, 1997 and September 30, 1996 5
Notes to Condensed Consolidated Financial Statements
September 30, 1997 6
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations 7
PART II. OTHER INFORMATION 9
</TABLE>
<PAGE>
-3-
THE DEWOLFE COMPANIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
ASSETS
<TABLE>
<CAPTION>
September 30, 1997 December 31, 1996
------------------ -----------------
<S> <C> <C>
CURRENT ASSETS
Cash $ 2,137,000 $ 2,586,000
Commissions receivable, net of allowance of $871,000 at
September 30, 1997 and $831,000 at December 31, 1996 17,216,000 12,589,000
Mortgage loans held for sale 10,961,000 6,735,000
Note and advance receivable from stockholder 91,000 66,000
Prepaid expenses and other current assets 451,000 327,000
------------- -------------
TOTAL CURRENT ASSETS 30,856,000 22,303,000
PROPERTY AND EQUIPMENT
Furniture and equipment 8,320,000 6,862,000
Land, building and improvements 4,939,000 4,523,000
------------- -------------
13,259,000 11,385,000
Accumulated depreciation (6,639,000) (4,921,000)
------------- -------------
NET PROPERTY AND EQUIPMENT 6,620,000 6,464,000
OTHER ASSETS
Excess of cost over value of net assets acquired, net of accumulated
amortization of $775,000 at September 30, 1997 and
$682,000 at December 31, 1996 1,741,000 1,834,000
Other Assets 2,162,000 1,996,000
------------- -------------
$ 41,379,000 $ 32,597,000
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Note payable, bank $ 10,650,000 $ 6,575,000
Current portion of long term debt 1,635,000 1,363,000
Commissions payable 11,583,000 8,451,000
Accounts payable and accrued expenses 2,821,000 1,796,000
Deferred mortgage fee income 148,000 202,000
------------- -------------
TOTAL CURRENT LIABILITIES 26,837,000 18,387,000
LONG TERM DEBT, net of current portion 2,525,000 3,215,000
NON COMPETE AGREEMENTS AND CONSULTING
AGREEMENTS PAYABLE 665,000 803,000
STOCKHOLDERS' EQUITY
Preferred stock, $1.00 par value; 3,000,000 shares authorized;
none outstanding
Common stock, $.01 par value; 10,000,000 shares authorized; 3,371,160
shares issued at September 30, 1997 and
3,352,049 shares issued at December 31, 1996 34,000 34,000
Additional paid-in capital 6,457,000 6,375,000
Retained earnings 5,488,000 3,989,000
------------- -------------
TOTAL STOCKHOLDERS' EQUITY BEFORE TREASURY STOCK 11,979,000 10,398,000
Less Treasury Stock (115,711 shares at September 30, 1997
and 35,163 shares at December 31, 1996) at cost (627,000) (206,000)
------------- -------------
TOTAL STOCKHOLDERS' EQUITY 11,352,000 10,192,000
------------- -------------
$ 41,379,000 $ 32,597,000
============= =============
</TABLE>
See notes to condensed consolidated financial statements
<PAGE>
-4-
THE DEWOLFE COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Revenues:
Real estate brokerage $26,560,000 $22,225,000 $78,718,000 $71,193,000
Mortgage origination 1,476,000 1,249,000 3,665,000 3,560,000
Other 67,000 37,000 545,000 423,000
----------- ----------- ----------- -----------
TOTAL REVENUES 28,103,000 23,511,000 82,928,000 75,176,000
Commission expense: 16,989,000 13,879,000 50,530,000 45,076,000
----------- ----------- ----------- -----------
NET REVENUES 11,114,000 9,632,000 32,398,000 30,100,000
Operating expenses:
Compensation and benefits 4,564,000 4,040,000 12,576,000 11,183,000
Facilities 1,324,000 1,262,000 3,950,000 3,603,000
General and administrative 2,579,000 1,951,000 6,814,000 5,647,000
Marketing and promotion 1,537,000 1,260,000 4,384,000 3,972,000
Communications 394,000 367,000 1,135,000 1,019,000
Provision for doubtful accounts 54,000 28,000 643,000 400,000
----------- ----------- ----------- -----------
TOTAL OPERATING EXPENSES 10,452,000 8,908,000 29,502,000 25,824,000
----------- ----------- ----------- -----------
OPERATING INCOME 662,000 724,000 2,896,000 4,276,000
Other income (expense):
Interest expense (333,000) (300,000) (849,000) (839,000)
Interest income 324,000 202,000 678,000 439,000
----------- ----------- ----------- -----------
INCOME BEFORE INCOME TAXES 653,000 626,000 2,725,000 3,876,000
Income Tax Expense 294,000 288,000 1,226,000 1,783,000
----------- ----------- ----------- -----------
NET INCOME $ 359,000 $ 338,000 $ 1,499,000 $ 2,093,000
=========== =========== =========== ===========
Earnings Per Common Share $ 0.11 $ 0.10 $ 0.44 $ 0.61
Weighted average common shares outstanding 3,375,000 3,449,000 3,397,000 3,406,000
</TABLE>
See notes to condensed consolidated financial statements
<PAGE>
-5-
THE DEWOLFE COMPANIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
-------------
1997 1996
---- ----
<S> <C> <C>
Increase (Decrease) in Cash
OPERATING ACTIVITIES
Cash received from customers $ 78,247,000 $ 70,400,000
Commissions and compensation paid to co-brokers, sales
associates and mortgage consultants (48,414,000) (42,910,000)
Operating expenses paid (25,908,000) (22,696,000)
Provision for doubtful accounts (643,000) (400,000)
Mortgage loans originated for sale (144,661,000) (131,619,000)
Proceeds from mortgage loan sales 140,435,000 134,726,000
Net borrowings (repayment) on note payable, bank 4,075,000 (2,982,000)
Interest received 678,000 439,000
Interest paid (834,000) (853,000)
Income taxes paid (693,000) (1,353,000)
--------------- --------------
Cash provided by operating activities 2,282,000 2,752,000
INVESTING ACTIVITIES
Expenditures for business combinations (100,000)
Expenditures for property and equipment (1,139,000) (797,000)
--------------- --------------
Cash used for investing activities (1,239,000) (797,000)
FINANCING ACTIVITIES
Net borrowings under revolving line of credit (400,000)
Principal payments on long term debt (1,153,000) (1,044,000)
Purchase of treasury stock (421,000) (105,000)
Issuance of common stock 82,000 209,000
--------------- --------------
Cash used for financing activities (1,492,000) (1,340,000)
--------------- --------------
NET (DECREASE) INCREASE IN CASH (449,000) 615,000
Cash at beginning of period 2,586,000 1,865,000
--------------- --------------
CASH AT END OF PERIOD $ 2,137,000 $ 2,480,000
=============== ==============
Supplemental Information:
Noncash investing and financing activities
Leases capitalized $ 735,000 $ 705,000
</TABLE>
See notes to condensed consolidated financial statements
<PAGE>
-6-
THE DEWOLFE COMPANIES, INC.
SEPTEMBER 30, 1997
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
NOTE 1 - BASIS OF PRESENTATION
- ------------------------------
The accompanying unaudited condensed 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 a fair presentation have
been included. Operating results for the nine month period 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 2 - CHANGE IN ACCOUNTING STANDARD
- --------------------------------------
In February 1997, the Financial Accounting Standards Board issued Statement No.
128, Earnings Per Share, which is required to be adopted on December 31, 1997.
At that time, the Company will be required to change the method currently used
to compute earnings per share and to restate all prior periods. The impact of
Statement 128 on the calculation of primary and fully diluted earnings per share
for the quarter and the nine month period ended September 30, 1997 is not
expected to be material.
<PAGE>
-7-
THE DEWOLFE COMPANIES, INC.
SEPTEMBER 30, 1997
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Overview
- --------
The net income in the third quarter of 1997 was $359 thousand as compared to a
net income of $338 thousand in the third quarter of 1996. Net income for the
first nine months of 1997 was $1.5 million compared to a net income of $2.1
million for the first nine months of 1996. The decrease in the 1997 year-to-date
earnings was primarily attributed to a reduction in net revenue margins in real
estate brokerage and increased operating expenses.
Results of Operations
- ---------------------
Real Estate Brokerage Revenues:
Real estate brokerage revenues increased 20% in the third quarter of 1997 to
$26.6 million, an increase of $4.3 million over the third quarter of 1996. For
the first nine months of 1997 real estate brokerage revenues were $78.7 million,
an increase of 11% as compared to the first nine months of 1996. The increase in
real estate brokerage revenues is primarily attributed to the continued increase
in business in the Company's existing markets caused by a general improvement in
consumer confidence that had a generally positive effect on residential real
estate brokerage in 1996 and 1997.
Real estate brokerage revenue includes $1.6 million of income from relocation
services in the third quarter of 1997 as compared to $1.2 million in the third
quarter of 1996, an increase of 27%. Real estate brokerage revenues from
relocation services were $4.5 million for the first nine months of 1997, as
compared to $3.7 million for the first nine months of 1996, an increase of 19%.
The increase was primarily due to an increase in the number of corporate
accounts and affinity groups that the Company serviced.
Net revenues from real estate brokerage increased 15% or $1.5 million in the
third quarter of 1997 to $11.1 million, and increased 8% or $2.3 million for the
first nine months of 1997 to $32.4 million. Net real estate brokerage revenues
as a percentage of real estate brokerage revenues were 36.0% for the third
quarter of 1997 as compared to 37.6% in the third quarter of 1996 and were 35.8%
for the first nine months of 1997 as compared to 36.7% for the first nine months
of 1996.
Net revenues from real estate brokerage services are impacted by many factors,
including those beyond the Company's control, such as the number of co-brokered
home sales and pressure on the Company to change commission structures necessary
to attract and retain qualified sales associates.
Mortgage Revenues:
Mortgage revenues increased 18% in the third quarter of 1997 to $1.5 million, an
increase of $227 thousand compared to the third quarter of 1996. For the first
nine months of 1997 mortgage revenues were $3.7 million, an increase of 3% or
$105 thousand as compared to the same period in 1996. The increase in the third
quarter is due to an increase in closed loan volume for the third quarter of
1997 as compared to 1996 and improved pricing on loans. The increase in the
first nine months of 1997 is due to improved pricing on loans, partially offset
by a decrease in closed loan volume for the first nine months of 1997 as
compared to the first nine months of 1996.
Closed loan volume in the third quarter of 1997 and 1996 was $81.2 million and
$79.2 million, respectively. For the first nine months of 1997 and 1996 closed
loan volume was $213.0 million and $217.4 million, respectively.
Net revenues from mortgage services (mortgage revenues less expenses associated
with commissions payable to the Company's mortgage consultants) as a percentage
of total mortgage revenues were 72% in the third quarter of 1997 compared to 71%
in the third quarter of 1996 and 72% for the first nine months of 1997 compared
to 71% for the first nine months of 1996.
<PAGE>
-8-
Operating Expenses:
Operating expenses for the third quarter of 1997 increased $1.5 million or 17%
from the third quarter of 1996. The increase is primarily due to cost increases
of approximately $600 thousand caused by the increase in the Company's overall
business, approximately $100 thousand of initial operating costs of the
Company's insurance agency and approximately $800 thousand in increased
operating expenses including investments to develop support services such as
information systems and marketing. Operating expenses as a percentage of net
revenues were 94% in the third quarter of 1997 compared to 92% in the third
quarter of 1996.
Operating expenses increased $3.7 million or 14% for the first nine months of
1997 compared to the first nine months of 1996. The increase is primarily due to
cost increases of approximately $1.9 million caused by the increase in the
Company's overall business, approximately $200 thousand of initial operating
costs of the Company's insurance agency and approximately $1.6 million in
increased operating expenses including investments to develop support services
such as information systems and marketing. Operating expenses as a percentage of
net revenues increased from 86% to 91% for the nine months of 1997 and 1996,
respectively.
Interest Expense and Interest Income:
Interest expense increased by $33 thousand in the third quarter of 1997 as
compared to 1996 and increased by $10 thousand for the first nine months of 1997
as compared to 1996. The interest expense variances are primarily due to the
financing of capital lease obligations, borrowing under the revolving line of
credit, and borrowing under the mortgage warehouse line of credit.
The increase of $122 thousand in interest income in the third quarter of 1997 as
compared to 1996, as well as the increase of $239 thousand for the first nine
months of 1997 compared to 1996, is primarily due to increases in interest rates
earned and balances kept in the Company's bank accounts.
Liquidity and Sources of Capital
Cash balances at September 30, 1997 and September 30, 1996 were $2.1 million and
$2.5 million, respectively. Cash provided by operations for the first nine
months of 1997 was $2.3 million as compared to cash provided by operations for
the first nine months of 1996 of $2.8 million.
The Company has various credit arrangements with the First National Bank of
Boston. The arrangements provide for a term note of $1.5 million which was used
to finance the acquisition of Hillshire House, Inc. in December, 1994 and
requires $25,000 monthly principal payments, an equipment lease line of credit
of $4.0 million, and a revolving credit line of $3.0 million.
The remaining outstanding balance of the term note was $900 thousand at
September 30, 1997 and $1.2 million at September 30, 1996. At September 30, 1997
and 1996, the Company had outstanding balances under lease lines of credit of
$2.3 million and $2.2 million, respectively. The Company has no borrowings under
the revolving line of credit at September 30, 1997 and September 30, 1996.
In connection with the mortgage loan activity the Company maintains a $25
million credit line that is used to finance mortgage loans that it originates
and had outstanding balances of $10.6 million and $7.7 million at September 30,
1997 and 1996, respectively.
In 1996, the Company approved a stock repurchase plan authorizing the Company to
acquire up to $1 million of the Company's outstanding common stock. As of
September 30, 1997, the Company had acquired a total of $507 thousand of stock
under the plan, $119 thousand of which was acquired during the quarter.
The Company considers its future cash flow from operations combined with its
credit arrangement with the First National Bank of Boston to be adequate to fund
continuing operations. However, the Company expects to continue to expand its
existing businesses which may include opening new real estate sales offices as
well as making investments in or acquiring other real estate businesses. As a
result, the Company from time-to-time may seek additional or alternate sources
of debt or equity financing which may include the issuance of shares of the
Company's capital stock or treasury stock.
<PAGE>
-9-
THE DEWOLFE COMPANIES, INC.
September 30, 1997
PART II. OTHER INFORMATION
Item 6 Exhibits and Reports on Form 8-K
(a) The following Exhibits are included herein:
See Exhibit Index on page 11 of this report
(b) Reports on Form 8-K
None
<PAGE>
-10-
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: November 12, 1997 THE DEWOLFE COMPANIES, INC.
By: /s/ James A. Marcotte
---------------------------
James A. Marcotte
Senior Vice President
and Chief Financial Officer
<PAGE>
-11-
THE DEWOLFE COMPANIES, INC.
September 30, 1997
EXHIBIT INDEX
10-Q
<TABLE>
<CAPTION>
ITEM DESCRIPTION LOCATION
- ---- ----------- --------
<S> <C> <C>
10.0 Employment Agreement with Gail Hayes Pages 12 to 14 of this report
dated September 2, 1997
11.0 Statement re: Computation of Per Share Earnings Page 15 of this report
27.0 Financial Data Schedule
</TABLE>
-12-
EMPLOYMENT AGREEMENT
--------------------
This agreement is made between The DeWolfe Companies, Inc. ("DeWolfe") and Gail
Hayes ("Employee"). DeWolfe agrees to associate with Employee upon the terms
contained in this agreement, and Employee agrees to work in the best interests
of DeWolfe at all times, upon the terms contained in this agreement.
TERM: The employment shall commence on September 2, 1997 and will continue until
canceled, amended, or terminated as described in this agreement.
TITLE: The Employee will be appointed as President of DeWolfe Mortgage Services,
Inc. and Vice President of The DeWolfe companies, Inc.
ASSIGNMENT: The Employee's assignment and responsibilities will be defined by
DeWolfe, and may be changed at any time. In general, the Employee is responsible
for managing the operations and activities of DeWolfe Mortgage Services,
including, but not limited to, (i) managing all other employees assigned, (ii)
planning, budgeting, and implementing DeWolfe's strategies toward achieving
mortgage production and profit goals, and (iii) in general, directing a
service-oriented Mortgage Company toward achieving the business goals
established by senior management of DeWolfe. The Employee will keep informed
about the company's businesses in general, and shall participate in all
training, meetings and functions required by DeWolfe.
COMPENSATION: Compensation will be established by DeWolfe from time to time, and
initially will be paid in accordance with the Compensation Schedule attached as
Exhibit A. The Employee shall be entitled to all benefits generally provided by
DeWolfe to its senior executives. The Employee shall be entitled to 4 weeks
vacation time, mutually agreed upon, submitted in writing to accrue at a rate of
five days after each three month period of employment. (Vacation time may not be
carried forward to next year).
TERMINATION: This Agreement and the employment created thereby may be terminated
at any time without cause by either party upon sixty (60) days written notice.
If employee is terminated by DeWolfe without cause, base compensation will
continue for the period of one year. DeWolfe may terminate this agreement and
the employment created herein without notice for cause, including fraud,
criminal activity, dereliction of duties, or failure to comply with the terms of
this agreement or DeWolfe policies and procedures. After termination, the
Employee will not solicit any employee, sales associate, manager, or other
person associated with DeWolfe or its affiliated Companies for the purpose of
inducing that person(s) to terminate employment or association with DeWolfe.
CONFIDENTIALITY: It is understood that the Employee may from time to time have
knowledge of information which is confidential in nature, including, but not
limited to customer and client lists, agent and management information, training
and procedures, manuals, sales tactics, strategies, financial results and other
trade secrets. The Employee will not, at any time during employment or after
termination, disclose any confidential information, nor trade in the stock of
The DeWolfe Companies, Inc. based upon confidential information.
NOTICES: Any notice required under this agreement will be deemed sufficient if
mailed or delivered to the parties at the following addresses:
<PAGE>
- 13 -
Employee: Gail Hayes
2 Gunwale Way
Yarmouthport, MA 02675
DeWolfe: The DeWolfe Companies, Inc.
80 Hayden Avenue, Lexington, MA 02173
GOVERNING LAW: This agreement shall be governed by the laws of the Commonwealth
of Massachusetts.
Signed this _____ day of ___________, 19___.
Employee The DeWolfe Companies, Inc.
- -------------------------- ------------------------------------------------
Gail Hayes By: Paul J. Harrington, Executive Vice President
<PAGE>
-14 -
COMPENSATION SCHEDULE - EXHIBIT A
---------------------------------
Date: September 1, 1997
This Compensation Schedule is incorporated by reference in the Employment
Agreement between The DeWolfe Companies, Inc. and the Employee named below, and
supersedes any prior Compensation Schedule. The Employee shall receive base pay
of $6,153.85 every two weeks ($160,000/year), in accordance with DeWolfe's
current payment system.
In addition, Employee will be entitled to receive incentive compensation up to
$65,000, based on goals established for performance, and productivity an
profitability of the mortgage operation beginning in January, 1998. Incentive
compensation will be earned as follows:
1. For each completed fiscal quarter, beginning with the fourth quarter of
1997 (ending December 31, 1997), the following amounts will be payable
within 45 days of the end of the quarter:
o $5,000 if the dollar volume of closed mortgage loans exceeds the
prior year period by 10% or more.
o $5,000 if the net income of DeWolfe Mortgage Services exceeds the prior
year period by 10% or more.
2. For fiscal 1998 (ending December 31, 1998), the following will be payable
within 45 days of the end of the year
o $25,000 if DeWolfe Mortgage and The DeWolfe Companies both exceed
budgeted net income for the year.
Health insurance coverage, within the Company's group plans, will be paid in
full. Other benefits that are available generally to DeWolfe employees will be
available to Employee, including participation in the Company's 401(k) plan,
subject to the applicable waiting period.
Employee will receive an Incentive Stock Option, pursuant to the Company's stock
option plan, and subject to approval by the Board of Directors Stock Option
Committee, for 10,000 shares of DeWolfe Common Stock, at fair market value on
the date of grant.
Employee will receive $500.00 per month for automobile expenses. Other ordinary
and necessary business expenses will be reimbursed upon approval of Expense
Reports.
Employee The DeWolfe Companies, Inc.
- --------------------------- ------------------------------------------------
Gail Hayes By: Paul J. Harrington, Executive Vice President
-15-
THE DEWOLFE COMPANIES, INC
Exhibit 11.0 Statement Re: Computation of Per Share Earnings
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
------------- -------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Weighted Average
Shares Outstanding 3,257,000 3,327,000 3,279,000 3,305,000
Net effect of dilutive stock
options-based on the treasury
stock method using the
period end market price if
higher than average market price 118,000 122,000 118,000 101,000
---------- ---------- ---------- ----------
Total 3,375,000 3,449,000 3,397,000 3,406,000
========== =========== ========== ==========
Net Income $ 359,000 $ 338,000 $1,499,000 $2,093,000
========== =========== ========== ==========
Net Income Per Share $0.11 $0.10 $0.44 $0.61
========== =========== ========== ==========
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM CONDENSED
CONSOLIDATED BALANCE SHEET (UNAUDITED) AND CONDENSED CONSOLIDATED STATEMENTS OF
INCOME (UNAUDITED) AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH 10-Q.
</LEGEND>
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> SEP-30-1997
<EXCHANGE-RATE> 1
<CASH> 2,137
<SECURITIES> 0
<RECEIVABLES> 18,087
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 30,856
<PP&E> 13,259
<DEPRECIATION> 6,639
<TOTAL-ASSETS> 41,379
<CURRENT-LIABILITIES> 26,837
<BONDS> 4,825
0
0
<COMMON> 34
<OTHER-SE> 11,945
<TOTAL-LIABILITY-AND-EQUITY> 41,379
<SALES> 0
<TOTAL-REVENUES> 82,928
<CGS> 0
<TOTAL-COSTS> 50,530
<OTHER-EXPENSES> 29,502
<LOSS-PROVISION> 643
<INTEREST-EXPENSE> 849
<INCOME-PRETAX> 2,725
<INCOME-TAX> 1,226
<INCOME-CONTINUING> 1,499
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,499
<EPS-PRIMARY> .44
<EPS-DILUTED> .44
</TABLE>
