FORM 10-QSB
- --------------------------------------------------------------------------------
U.S. Securities and Exchange Commission
Washington, D.C. 20549
[ ] QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
[X] TRANSITION REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM NOVEMBER 1, 1997 TO DECEMBER 31, 1997
Commission File Number: 0-21394
DEVELOPED TECHNOLOGY RESOURCE, INC.
(Exact name of issuer as specified in its charter)
MINNESOTA 41-1713474
State of Incorporation I.R.S. Employer Identification No.
7300 METRO BOULEVARD, SUITE 550
EDINA, MINNESOTA 55439
Address of Principal Executive Office
(612) 820-0022
Issuer's Telephone Number
Check whether the issuer (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 August 7, 1998, there were 805,820 shares of the issuer's Common Stock,
$0.01 par value per share, outstanding.
<PAGE>
DEVELOPED TECHNOLOGY RESOURCE, INC.
INDEX
FOR THE TWO MONTH TRANSITION PERIOD ENDED DECEMBER 31, 1997
PAGE NO.
--------
PART I. FINANCIAL INFORMATION
ITEM 1. CONDENSED UNAUDITED FINANCIAL STATEMENTS
Condensed Balance Sheets 3
Condensed Statements of Operations 4
Condensed Statements of Cash Flows 5
Notes to Condensed Financial Statements 6
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS 9
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SHAREHOLDERS 12
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K 12
SIGNATURES 14
2
<PAGE>
ITEM 1. CONDENSED UNAUDITED FINANCIAL STATEMENTS
DEVELOPED TECHNOLOGY RESOURCE, INC.
CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
ASSETS
DECEMBER 31, OCTOBER 31,
1997 1997
------------ ------------
(Unaudited)
<S> <C> <C>
Current Assets:
Cash and cash equivalents $ 284,526 $ 311,441
Receivables:
Trade, net 80,820 97,939
Sale of discontinued operations 480,000 440,000
FoodMaster International L.L.C. (FMI) 371,801 579,582
Other 763 714
Note receivable 516,935 --
Prepaid and other current assets 41,352 46,046
------------ ------------
Total current assets 1,776,197 1,475,722
Furniture and Equipment, net 39,381 45,466
Investment in FMI 834,917 788,785
Receivable from Sale of Discontinued Operations -- 40,000
------------ ------------
$ 2,650,495 $ 2,349,973
============ ============
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities:
Accounts payable $ 257,938 $ 100,269
Accrued liabilities 147,337 124,838
Deferred gain short-term 467,065 426,590
------------ ------------
Total current liabilities 872,340 651,697
Non-current Deferred Gain 38,986 80,675
Commitments and Contingencies -- --
Shareholders' Equity:
Common stock 7,908 7,908
Additional paid-in capital 5,319,298 5,319,298
Accumulated deficit (3,588,037) (3,709,605)
------------ ------------
Total shareholders' equity 1,739,169 1,617,601
------------ ------------
$ 2,650,495 $ 2,349,973
============ ============
</TABLE>
See accompanying notes to the financial statements.
3
<PAGE>
DEVELOPED TECHNOLOGY RESOURCE, INC.
CONDENSED STATEMENTS OF OPERATIONS
TWO MONTHS ENDED DECEMBER 31, 1997 AND 1996
<TABLE>
<CAPTION>
1997 1996
---------- ----------
(Unaudited) (Unaudited)
<S> <C> <C>
Revenues:
Sales $ 346,844 $ 847,024
Management fees from FMI joint venture 190,548 --
Commissions and other income 1,215 8,249
---------- ----------
538,607 855,273
---------- ----------
Cost and Expenses:
Cost of sales 274,362 537,626
Selling, general and administrative 206,004 329,119
---------- ----------
480,366 866,745
---------- ----------
Operating Income (Loss) 58,241 (11,472)
Other Income:
Interest income, net 17,194 8,214
Equity in earnings of FMI joint venture 46,133 --
---------- ----------
Income (Loss) before Minority Interest 121,568 (3,258)
Minority Interest in Earnings of FoodMaster -- (28,982)
---------- ----------
Net Income (Loss) $ 121,568 $ (32,240)
========== ==========
Net Income (Loss) per Common Share:
Basic $ 0.15 $ (0.04)
========== ==========
Diluted $ 0.11 $ (0.04)
========== ==========
</TABLE>
See accompanying notes to the financial statements.
4
<PAGE>
DEVELOPED TECHNOLOGY RESOURCE, INC.
CONDENSED STATEMENTS OF CASH FLOWS
TWO MONTHS ENDED DECEMBER 31, 1997 AND 1996
<TABLE>
<CAPTION>
1997 1996
---------- ----------
(Unaudited) (Unaudited)
<S> <C> <C>
OPERATING ACTIVITIES:
Net Income (Loss) $ 121,568 $ (32,240)
Adjustments to Reconcile Net Income (Loss)
to Cash Provided by Operating Activities:
Depreciation 4,432 80,840
Loss on sale of furniture and equipment 688 --
Unrealized currency gain -- (179,001)
Minority interest in earnings of joint venture -- 28,982
Equity in earnings of FMI joint venture (46,132) --
Changes in Operating Assets and Liabilities:
Receivables 135 52,155
Receivable from FMI joint venture 207,781 --
Inventories -- (26,846)
Prepaid and other current assets 4,694 (17,642)
Accounts payable and accrued liabilities 180,168 (17,617)
Deferred gains (1,214) 92,671
Customer deposits -- 23,791
---------- ----------
Net cash provided by operating activities 472,120 5,093
---------- ----------
INVESTING ACTIVITIES:
Proceeds from Sale of Furniture and Equipment 1,400 --
Purchases of Furniture and Equipment (435) (236,925)
Notes Receivable (500,000) --
Advances to Joint Venture -- 88,438
Deferred Acquisition Costs -- (52,114)
---------- ----------
Net cash used by investing activities (499,035) (200,601)
---------- ----------
FINANCING ACTIVITIES:
Principal Payments on Note Payable -- (14,735)
---------- ----------
Net cash provided/(used) by financing activities -- (14,735)
---------- ----------
DECREASE IN CASH AND CASH EQUIVALENTS (26,915) (210,243)
CASH AND CASH EQUIVALENTS, Beginning of Period 311,441 635,609
---------- ----------
CASH AND CASH EQUIVALENTS, End of Period $ 284,526 $ 425,366
========== ==========
</TABLE>
See accompanying notes to the financial statements.
5
<PAGE>
DEVELOPED TECHNOLOGY RESOURCE, INC.
NOTES TO FINANCIAL STATEMENTS
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Business
Developed Technology Resource, Inc. (DTR or the Company) owns and manages
food businesses in the countries of the former Soviet Union (fSU) through
FoodMaster International L.L.C. (FMI), its joint venture with Agribusiness
Partners International L.P. (API). FMI purchases dairy manufacturing
facilities in the fSU and provides equipment and necessary capital. DTR
manages the dairies and pursues future acquisitions for FMI. Using modern
marketing techniques and packaging equipment, the dairies provide customers
in the fSU better quality branded dairy products.
In fiscal 1998 and 1997, DTR also sold equipment to various customers
throughout the fSU.
During fiscal 1998, DTR's 100% owned subsidiary, SXD, Inc., distributed
X-ray tubes under an exclusive arrangement with a Russian manufacturer and
held ownership interests in the coatings technology business of Phygen,
Inc. and the cancer detection business of Armed. These operations were
formerly operated by DTR in fiscal 1997.
Basis of Presentation
The interim financial statements of Developed Technology Resource, Inc.
(DTR) are unaudited, but in the opinion of management, reflect all
necessary adjustments for a fair presentation of the financial position, as
well as, the results of operations and cash flows for the periods
presented.
On June 30, 1998, the Company decided to change its year end from October
31 to December 31. As a result, this transition report on form 10-QSB shows
the results for the two-month period of November and December 1997 and 1996
to reflect the Company's new year end of December 31.
From November 1996 through February 1997, the financial statements include
the operations of DTR and FoodMaster Corporation (FoodMaster), DTR's 50%
owned subsidiary in Almaty, Kazakhstan. All significant intercompany
transactions and balances were eliminated in consolidation. On March 3,
1997, DTR contributed its 50% ownership of FoodMaster to the FMI joint
venture for a 40% ownership in FMI. Effective March 1997, DTR records its
proportionate share of the net income or loss of FMI in the statement of
operations as equity in earnings of FMI joint venture under the equity
method of accounting. The excess of DTR's underlying equity in net assets
of FMI over the carrying value of its investment is being amortized to
income over 15 years.
The results of operations for any interim period are not necessarily
indicative of results for the full year. These financial statements should
be read in conjunction with the Company's Annual Report and Notes thereto
on Form 10-KSB for the year ended October 31, 1997 as filed with the
Securities and Exchange Commission.
Segment Reporting
In June 1997, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards (SFAS) No. 131, DISCLOSURES
ABOUT SEGMENTS OF AND ENTERPRISE AND RELATED INFORMATION. This statement is
effective for fiscal years beginning after December 15, 1997. The Company
has not yet evaluated the full impact of the adoption of SFAS 131.
Use of Estimates
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities at
the date of the financial statements and reported amounts of revenues and
expense during the reporting period. Actual results could differ from those
estimates.
6
2
<PAGE>
Reclassifications
Certain reclassifications were made to the 1996 financial statements to
present those financial statements on a basis comparable with the current
year. The reclassifications had no effect on previously reported net loss
or accumulated deficit.
2. AK-BULAK OPTION
Effective August 1996, the Company obtained an option to purchase 80% of
Ak-Bulak, an inactive company which owned the other 50% of the FoodMaster
joint venture. This purchase of 80% of Ak-Bulak would give DTR an
additional 40% ownership of FoodMaster. To exercise the option, the Company
agreed to pay certain pre-defined outstanding debts of Ak-Bulak, the other
owner of FoodMaster, and to make capital improvements to the dairy owned by
FoodMaster. As of March 2, 1997 and December 31, 1997, DTR had paid
$171,774 and $48,054, respectively, in connection with the exercise of this
option. On March 3, 1997, DTR contributed its 50% ownership in FoodMaster
along with its option to acquire the additional 40% ownership to the FMI
joint venture. FMI repaid DTR for all but $14,045 of the costs paid through
March 2, 1997 to exercise the option (See Note 3).
3. INVESTMENT IN FOODMASTER INTERNATIONAL L.L.C. (FMI)
On March 3, 1997, DTR and API established the FMI joint venture, to acquire
and operate dairies in the former Soviet Union. DTR contributed to FMI its
50% ownership in FoodMaster, the Ak-Bulak option (See Note 2) and its
opportunities for a future acquisition of a dairy in Moldova. API agreed to
fund $2.945 million to further develop the dairy operations in Kazakhstan
and Moldova and to provide an additional $3.055 million over two years to
expand FMI. By December 31, 1997, API contributed $3.45 million of its $6
million commitment to FMI. Under the agreement, API currently owns 60% and
DTR owns 40% of FMI. However, DTR has a right to earn a greater ownership
interest of FMI by achieving certain defined performance targets based on
returns to API. Effective March 1997, DTR records its proportionate share
of the net income or loss of FMI in the statement of operations as equity
in earnings of FMI joint venture under the equity method of accounting.
DTR also entered into a management agreement with FMI, whereby DTR manages
the day to day operations of FMI and the dairy operations owned by FMI, and
pursues future dairy acquisitions for FMI for a management fee. The Company
recorded management fee income of $190,548 and $0 for the two months ended
December 31, 1997 and 1996, respectively, in accordance with its management
agreement with FMI.
Summarized financial information from the unaudited financial statements of
FMI carried on the equity basis is as follows:
<TABLE>
<CAPTION>
December 31, 1997
-----------------
<S> <C>
Current assets $ 4,324,095
Total assets 10,996,453
Noncurrent liabilities 948,877
Shareholders' equity 7,076,567
DTR's share of FMI 's equity 2,830,627
DTR's carrying value of FMI's equity 834,917
Two Months Ended
December 31, 1997
-----------------
Sales $ 2,168,944
Gross loss (97,687)
Net income 24,391
DTR's share of FMI's loss before adjustment of DTR's excess
of net equity over carrying value of the investment 9,756
DTR's share of equity in earnings of FMI joint venture after adjustment 46,132
</TABLE>
7
<PAGE>
4. STOCK ACTIVITY
On November 6, 1997, the Board of Directors adopted the 1997 Outside
Directors Stock Option Plan, superseding the 1993 Outside Directors Stock
Option Plan. In exchange for the surrender of all stock options previously
granted to the outside directors, the Board granted stock options of 15,000
shares of common stock to the two current outside directors at an exercise
price of $1.50 per share, which was equal to the market price on the grant
date. As of December 31, 1997, none of the 30,000 issued options were
exercised.
In December 1996, 48,190 shares of common stock were redeemed in exchange
for the satisfaction of a $29,035 account receivable owed by a former
employee.
5. NET INCOME (LOSS) PER COMMON SHARE
Effective November 1, 1997, DTR adopted Statement of Financial Accounting
Standards (SFAS) No. 128, EARNINGS PER SHARE. Under this new standard,
basic net income (loss) per share is computed by dividing net income (loss)
by the weighted average number of common shares outstanding. Diluted net
income (loss) per share includes the dilutive effect of shares which would
be issued upon the exercise of outstanding stock options and warrants,
reduced by the number of shares which are assumed to be purchased by the
Company from the resulting proceeds at the average market price during the
period.
For the two months ended December 31, 1997 1996
---------- ----------
Numerator:
Net income (loss) $ 121,568 $ (32,240)
========== ==========
Denominator:
Weighted average shares for basic earnings 790,820 821,630
Dilutive effect of stock options and warrants 282,945 --
---------- ----------
Weighted average shares for diluted earnings 1,073,765 821,630
---------- ----------
Net income (loss) per share - Basic $ 0.15 $ (0.04)
========== ==========
Net income (loss) per share - Diluted $ 0.11 $ (0.04)
========== ==========
Options and warrants to purchase 53,333 shares of common stock as of
December 31, 1997 were not included in the computation of diluted earnings
per share because their exercise prices were greater than the average
market price of the common shares and, therefore, their inclusion would be
antidilutive. For the two months ended December 31, 1996, options and
warrants of 578,501 were not included in the computation of diluted
earnings per share because there was a net loss for the period and their
inclusion would be antidilutive.
6. SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Non-cash operating and investing activities:
In December 1996, the Company redeemed 48,190 shares of common stock in
exchange for the satisfaction of a $29,035 account receivable owed by a
former employee.
The non-cash effects of this transactions has been removed from the
appropriate categories in the operating and investing section of the
Company's Statements of Cash Flows for the two months ended December 31,
1996.
Supplemental cash flow information:
For the two months ended December 31, 1997 1996
------------------------------------- ------------- ------------
Cash paid for:
Interest $ -- $ --
Taxes $ -- $ --
8
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
Statements other than current or historical information included in
this Management's Discussion and Analysis and elsewhere in this Form 10-QSB, in
future filings by Developed Technology Resource, Inc. (the Company or DTR) with
the Securities and Exchange Commission and in DTR's press releases and oral
statements made with the approval of authorized executive officers, should be
considered "forward-looking statements" made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995. These
statements are subject to certain risks and uncertainties that could cause
actual results to differ materially from historical earnings and those presently
anticipated or projected. DTR wishes to caution the reader not to place undue
reliance on any such forward-looking statements.
On March 3, 1997, DTR and API established the FMI joint venture to
acquire and operate dairies in the former Soviet Union. DTR contributed to FMI
its 50% ownership in FoodMaster, the Ak-Bulak option and its opportunities for a
future acquisition of a dairy in Moldova. API agreed to fund $2.945 million to
further develop the dairy operations in Kazakhstan and Moldova and to provide an
additional $3.055 million over two years to expand FMI. By December 31, 1997,
API contributed $3.45 million of its $6 million commitment to FMI. Under the
agreement, API currently owns 60% of FMI. DTR owns 40% of FMI. However, DTR has
a right to earn a greater ownership interest of FMI by achieving certain defined
performance targets based on returns to API. Effective March 1997, DTR records
its proportionate share of the net income or loss of FMI in the statement of
operations as equity in earnings of FMI joint venture under the equity method of
accounting.
In November 1997, DTR's Board of Directors voted to establish a
wholly-owned subsidiary company called SXD, Inc. with a contribution of $800,000
in cash and receivables. SXD owns and operates DTR's x-ray tube distribution
business, ownership interests in the coating technology business of Phygen,
Inc., and the cancer detection business of Armed.
RESULTS OF OPERATIONS
REVENUES
The Company generated total revenues of $538,607 in the two months
ended December 31, 1997 compared to total revenues of $855,273 as of December
31, 1996. This 37% decrease in revenues is the result of the change from the
consolidated method of reporting joint venture operating results to the equity
method as discussed above. The decrease in revenues was offset by management fee
income of $190,548 in 1997 which was not in effect in 1996.
Sales for the two months ended December 31, 1997 and 1996 totaled
$346,844 and $847,024, respectively. Sales resulted from three areas within DTR
- - dairy operations of FoodMaster (until February 1997 only), equipment sales,
and x-ray tube sales.
In the two months of 1997, the dairy operations of FoodMaster are no
longer reported on a consolidated basis with DTR due to the transfer of
FoodMaster to FMI. The dairy operations of FoodMaster are consolidated in the
financial statements of FMI, and DTR recognizes 40% of FMI's income or loss as
equity in earnings of FMI joint venture in DTR's Statements of Operations.
FoodMaster sales from November 1996 through December 1996 were $809,511 or 95.6%
of DTR's total sales for the two months ended December 31, 1996.
9
<PAGE>
Sales of food packaging equipment were $279,644 (80.6%) of total sales
in the two months ended December 31, 1997. There were no sales of equipment in
the final two months of 1996. Sales of equipment occur sporadically throughout
the year. Therefore, no equipment sales occurred in the final two months of
1996.
Sales of x-ray tubes by SXD Inc., DTR's 100% owned subsidiary,
increased to $67,200 in the two months of 1997 from $37,800 in the two months of
1996. The increase occurred due to the timing and quantity of orders during this
period in 1997. Management does not expect the current year annual sales to
increase significantly above that of the prior year.
COST OF SALES
Cost of sales for the two months ended December 31, 1997 and 1996 were
$274,362 and $537,626, respectively. This 49% decrease in cost of sales is the
result of the change in accounting methods discussed above. Cost of sales
reflects the cost of manufacturing the dairy products of FoodMaster for the
final two months in 1996, and the cost of purchasing food packaging equipment
and x-ray tubes.
There is no cost of sales reflected for FoodMaster in the final two
months of 1997. FoodMaster cost of sales was $501,055 or 61.9% of FoodMaster
sales for the final two months of 1996.
Cost of sales on equipment sales was $216,762 resulting in a gross
profit of $62,882 or 22.5% in fiscal 1998. X-ray tubes cost $57,600 and $32,900
in the first quarter of fiscal 1998 and 1997, respectively. Gross profit
remained consistent with a 13% to 14% margin received on sales. Management does
not expect these trends to change significantly.
SELLING, GENERAL AND ADMINISTRATIVE
Selling, general and administrative expenses for the two months ended
December 31, 1997 were $206,004 compared to $329,119 for the two months ended
December 31, 1996. During the two months of 1996, FoodMaster operations
comprised $260,859 of the $329,119 SG&A expenses. Therefore, the Company's other
SG&A expenses in 1996 excluding the FoodMaster operations was $68,260. The
$137,744 increase in SG&A expenses excluding FoodMaster operations is the result
of DTR hiring additional employees and consultants and increasing their travel
to manage the dairy operations of FMI. However, these costs are offset by the
management fees billed to FMI as discussed above under REVENUES.
LIQUIDITY AND CAPITAL RESOURCES
OPERATING ACTIVITIES
DTR increased its cash provided by operating activities to $472,120 in
the final two months of 1997 compared to cash provided of $5,093 in the final
two months of 1996. In November and Decmeber 1997, a majority of the operating
expenses were reimbursed in accordance with the management agreement between DTR
and FMI. Additionally, they do not reflect FoodMaster's operations which
significantly affected the use of cash in November and December 1996.
10
<PAGE>
INVESTING ACTIVITIES
In the two months ended December 31, 1997, DTR's 100% owned subsidiary,
SXD, Inc. used $500,000 of its excess cash to invest in a note receivable from
an unaffiliated private company. In the final two months of 1996, DTR paid out a
net $200,601 for additional equipment purchases and as part of the requirement
to exercise its option to purchase 80% of Ak-Bulak, its inactive 50% partner in
the FoodMaster joint venture.
FINANCING ACTIVITIES
DTR's FoodMaster operations obtained $70,910 in bank financing by
October 31, 1996 and began to make principal payments on this note in the first
quarter of fiscal 1997. FoodMaster made total principal payments of $14,735 on
its bank note payable during the period from November 1996 to December 1996.
Based on current projections, the Company believes there will be
sufficient working capital and liquidity to fund its current operations through
fiscal 1998. Management is continually looking for new areas of investment and
expansion for its subsidiaries FMI and SXD.
11
<PAGE>
PART II. OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SHAREHOLDERS
No matters were submitted to a vote of the shareholders during the two
months ended December 31, 1997.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
The following new Exhibits are filed as part of this Form
10-QSB:
(a) List of Exhibits
27 Financial Data Schedule
(b) Reports on Form 8-K
One report on Form 8-K was filed by Developed
Technology Resource, Inc. on December 23, 1997. There
were no other reports on Form 8-K filed during the
two months ended December 31, 1997.
12
<PAGE>
EXHIBIT INDEX
The following Exhibits are filed as part of this Form 10-QSB:
No. EXHIBIT DESCRIPTION
--- -------------------
27 Financial Data Schedule (8)
13
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
DEVELOPED TECHNOLOGY RESOURCE, INC.
Date: August 12, 1998 By /s/ John P. Hupp
-----------------------------------
Name: John P. Hupp
Title: President
Date: August 12, 1998 By /s/ LeAnn H. Davis
-----------------------------------
Name: LeAnn H. Davis, CPA
Title: Chief Financial Officer
(Principal Financial & Accounting Officer)
14
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 2-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> NOV-01-1997
<PERIOD-END> DEC-31-1997
<CASH> 284,526
<SECURITIES> 0
<RECEIVABLES> 1,460,827
<ALLOWANCES> 10,508
<INVENTORY> 0
<CURRENT-ASSETS> 1,776,197
<PP&E> 143,337
<DEPRECIATION> 103,956
<TOTAL-ASSETS> 2,650,495
<CURRENT-LIABILITIES> 872,340
<BONDS> 0
0
0
<COMMON> 7,908
<OTHER-SE> 1,731,261
<TOTAL-LIABILITY-AND-EQUITY> 2,650,495
<SALES> 346,844
<TOTAL-REVENUES> 538,607
<CGS> 274,362
<TOTAL-COSTS> 480,366
<OTHER-EXPENSES> (46,133)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (17,194)
<INCOME-PRETAX> 121,568
<INCOME-TAX> 0
<INCOME-CONTINUING> 121,568
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 121,568
<EPS-PRIMARY> 0.15
<EPS-DILUTED> 0.11
</TABLE>
