<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(MARK ONE)
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
For Quarterly Period Ended June 30, 1996
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES AND EXCHANGE ACT OF 1934
Commission File Number: 0-26054
PLANET POLYMER TECHNOLOGIES, INC.
----------------------------------------------------------------------
(Exact name of small business issuer as specified in its character)
CALIFORNIA 33-0502606
----------------------------------------------------------------------
(State or other jurisdiction I.R.S. Employer Identification No.
of incorporation or organization)
9985 Businesspark Ave., Suite A, San Diego, California 92131
----------------------------------------------------------------------
(Address of Principal executive offices) (Zip Code)
(619) 549-5130
----------------------------------------------------------------------
(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 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.
[ X ] YES [ ] NO
Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date:
Class Outstanding at June 30, 1996
Common Stock, no par value 5,260,664
<PAGE> 2
PLANET POLYMER TECHNOLOGIES, INC.
FORM 10-QSB QUARTERLY REPORT
QUARTER ENDED JUNE 30, 1996
INDEX
PAGE NO.
PART I - FINANCIAL INFORMATION
Item 1 Balance Sheet (Unaudited)
June 30, 1996 2
Statements of Operations (Unaudited)
Three Months Ended June 30, 1996 and 1995 3
Statements of Operations (Unaudited)
Six Months Ended June 30, 1996 and 1995 4
Statements of Cash Flows (Unaudited)
Six Months Ended June 30, 1996 and 1995 5
Statement of Shareholders' Equity (Unaudited)
Six Months Ended June 30, 1996 6
Notes to Unaudited Financial Statements 7
Item 2 Management's Discussion and Analysis of
Financial Condition and Results of Operations 9
PART II - OTHER INFORMATION
Item 1 Legal Proceedings 13
Item 2 Changes in Securities 13
Item 3 Defaults upon Senior Securities 13
Item 4 Submission of Matters to a Vote of Security Holders 13
Item 5 Other Information 13
Item 6 Exhibits and Reports on Form 8K 13
SIGNATURES 14
<PAGE> 3
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
PLANET POLYMER TECHNOLOGIES, INC.
BALANCE SHEET
JUNE 30, 1996
(UNAUDITED)
ASSETS
<TABLE>
<S> <C>
Current assets:
Cash and cash equivalents $ 697,903
Investments 1,910,278
Accounts Receivable 684,436
Inventories 291,590
Prepaid expenses 35,219
----------
Total current assets 3,619,426
Property and equipment, net 886,870
Goodwill, net 602,314
Patents and other, net 398,292
----------
Total assets $5,506,902
==========
LIABILITIES & SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued expenses:
Trade $ 287,832
Current portion of long term debt 136,291
----------
Total current liabilities 424,123
Long term debt 244,007
----------
Total liabilities 668,130
Shareholders' equity:
Preferred stock, no par value, 5,000,000 shares --
authorized, no shares outstanding
Common stock, no par value, 20,000,000 shares
authorized, 5,260,664 shares issued & outstanding 10,686,579
Accumulated Deficit (5,847,807)
----------
Total shareholders' equity 4,838,772
----------
Total liabilities and shareholders' equity $5,506,902
==========
</TABLE>
The accompanying notes are an integral part of the financial
statements.
2
<PAGE> 4
PLANET POLYMER TECHNOLOGIES, INC.
STATEMENTS OF OPERATIONS
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended June 30,
1996 1995
---- ----
<S> <C> <C>
Development revenue $ 102,680 $ 86,138
Product Sales 851,398 --
---------- ----------
Total revenue 954,078 86,138
---------- ----------
Operating expenses:
Cost of product sales 547,432 --
General and administrative 227,908 227,658
Marketing 307,728 413,509
Research and development 222,425 109,651
---------- ----------
Total operating expenses 1,305,493 750,818
---------- ----------
Loss from operations (351,415) (664,680)
Other income, net 17,809 5,247
---------- ----------
Net loss $ (333,606) $ (659,433)
========== ==========
Net loss per share $ (0.06) $ (0.15)
========== ==========
Shares used in per share
computations 5,260,664 4,266,670
========== ==========
</TABLE>
The accompanying notes are an integral part of the financial
statements.
3
<PAGE> 5
PLANET POLYMER TECHNOLOGIES, INC.
STATEMENTS OF OPERATIONS
YEAR TO DATE
(UNAUDITED)
<TABLE>
<CAPTION>
Six Months Ended June 30,
1996 1995
---- ----
<S> <C> <C>
Development revenue $ 125,950 $ 172,259
Product Sales 1,522,922 --
----------- ----------
Total revenues 1,648,872 172,259
----------- ----------
Operating expenses:
Cost of product sales 971,134 --
General and administrative 1,159,628 327,472
Marketing 636,192 538,567
Research and development 438,261 244,591
----------- ----------
Total operating expenses 3,205,215 1,110,630
----------- ----------
Loss from operations (1,556,343) (938,371)
Other income, net 49,649 9,386
----------- ----------
Net loss $(1,506,694) $ (928,985)
=========== ==========
Net loss per share $ (0.29) $ (0.22)
=========== ==========
Shares used in per share
computations 5,260,664 4,266,670
=========== ==========
</TABLE>
The accompanying notes are an integral part of the financial
statements.
4
<PAGE> 6
PLANET POLYMER
STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Six Months Ended June 30,
1996 1995
---- ----
<S> <C> <C>
Cash flows from operating activities:
Net loss $(1,506,694) $(928,985)
Adjustments to reconcile net loss to net cash
used by operating activities:
Depreciation 87,348 17,437
Amortization of intangibles 38,272 4,328
Compensation expense - non cash 478,491 --
Change in assets and liabilities:
Accounts receivable (212,902) (11,146)
Inventories (5,512) 7,800
Prepaid expenses and other assets 41,140 2,767
Accounts payable and accrued expenses (395,268) 15,780
----------- ---------
Net cash used by operating activities (1,475,125) (892,019)
----------- ---------
Cash flow from investing activities:
Purchases of property and equipment (32,821) (60,117)
Cost of patents, licenses and trademarks (12,597) (647)
Acquisition of subsidiary, net of cash acquired (803,945) --
Sales (purchases) of investments, net (173,328) 234,744
----------- ---------
Net cash provided ( used) by investing activities (1,022,691) 173,980
----------- ---------
Cash flow from financing activities:
Proceeds from issuance of common stock, -- 412,601
Payments on note payable (20,834) --
Payments on long term debt (40,918) --
----------- ---------
Net cash provided (used) by financing activities (61,752) 412,601
----------- ---------
Net decrease in cash and cash equivalents (2,559,568) (305,438)
Cash and cash equivalents at beginning of period 3,257,471 558,007
----------- ---------
Cash and cash equivalents at end of period $ 697,903 $ 252,569
=========== =========
Supplemental disclosure of non-cash activity:
Stock issued in connection with acquisition of subsidiary 508,069
</TABLE>
The accompanying notes are an integral part of the financial
statements.
5
<PAGE> 7
PLANET POLYMER TECHNOLOGIES
STATEMENT OF SHAREHOLDERS' EQUITY
(UNAUDITED)
<TABLE>
<CAPTION>
Common Stock Accumulated
-----------------------------
Shares Amount Deficit Total
------ ------ ----------- ----------
<S> <C> <C> <C> <C>
Balance at December 31, 1995 5,163,889 $ 9,700,019 $(4,341,113) $5,358,906
Issuance of common stock, net 96,775 508,069 508,069
Fair value of stock options
granted to an outside consultant 478,491 478,491
Net loss for the six months ended
June 30, 1996 (1,506,694) (1,506,694)
--------- ----------- ----------- ----------
Balance at June 30, 1996 5,260,664 $10,686,579 $(5,847,807) $4,838,772
========= =========== =========== ==========
</TABLE>
The accompanying notes are an integral part of the financial statements.
6
<PAGE> 8
PLANET POLYMER TECHNOLOGIES, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS
1. Basis of Presentation
The accompanying unaudited financial statements of Planet Polymer Technologies,
Inc. (the "Company" or "Planet") have been prepared in accordance with the
interim reporting requirements of Form 10-QSB, pursuant to the rules and
regulations of the Securities and Exchange Commission. 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 only normal
recurring adjustments) considered necessary for a fair presentation have been
included. Operating results for the six month period ended June 30, 1996 are not
necessarily indicative of results that may be expected for the year ended
December 31, 1996. For additional information, refer to the Company's financial
statements and notes thereto for the year ended December 31, 1995 contained in
the Company's Form 10-KSB for the fiscal year ended December 31, 1995 and the
financial statements of Deltco of Wisconsin, Inc. ("Deltco") for the year ended
December 31, 1995, contained in the Company's Current Report on Form 8K and
Current Report on Form 8-K/A filed with the Commission on January 5, 1996 and
March 15, 1996, respectively.
2. Acquisition
Effective January 1, 1996, the Company acquired all the outstanding capital
stock of Deltco, a Wisconsin corporation, from the sole stockholder of Deltco
pursuant to the terms of a Purchase and Sale Agreement dated as of January 1,
1996 (the "Agreement"). This transaction was accounted for as a purchase.
Pursuant to the Agreement, the Company paid the sole stockholder of Deltco
$1,125,000 and issued 96,775 shares of restricted Common Stock of the Company
valued at approximately $508,000 based on a discounted stock price at January 4,
1996, the date of announcement of the transaction. The purchase agreement also
specified target net worth and cash balances at the date of transaction. The
excess net worth of approximately $36,000 reduced by $24,000 due from the seller
brought the total purchase price to approximately $1,646,000. The Company paid
the cash portion of the purchase price out of its available cash reserves. The
stock portion of the purchase price was paid with newly issued shares of the
Company's Common Stock, which were issued pursuant to an exemption from the
registration requirements of the Securities Act of 1933, as amended. The
purchase price was first allocated to the tangible assets (which included
approximately $334,000 of cash) and liabilities based on fair market value at
the purchase date. The remaining amount, approximately $617,000, was recorded as
goodwill which will be amortized over 20 years.
In addition, the Agreement provides for contingent payments to the President of
Deltco based on performance criteria for each of the years ended December 31,
1996 and 1997.
As a result of this acquisition, the Company is no longer considered a
development stage enterprise as of January 1, 1996.
7
<PAGE> 9
PLANET POLYMER TECHNOLOGIES, INC.
NOTES TO UNAUDITED FINANCIAL STATEMENTS - (CONTINUED)
Supplemental Pro Forma Results of Operations
The following unaudited pro forma information presents the consolidated results
of operations for the six months ended June 30, 1995, as if the acquisition had
occurred at the beginning of the period and does not purport to be indicative of
what would have occurred had the acquisition actually been made as of such date
or of results which may occur in the future.
<TABLE>
<S> <C>
Total revenue................................................. $1,969,136
Loss from continuing operations............................... ($ 235,577)
Net loss...................................................... ($ 230,286)
Earnings per share............................................ ($ 0.053)
Shares used in per share computation.......................... 4,363,445
</TABLE>
3. Shareholders' Equity
Options
On January 31, 1996, the Company's Board of Directors granted non-statutory
stock options to purchase 66,137 shares of Common Stock at an exercise price of
$6.00 per share and 27,863 shares of Common Stock at an exercise price of $5.10
per share to an outside consultant of the Company. These options were
fully-vested as of the date of the grant and expire on January 30, 2004. In
connection with this transaction, the Company recorded a charge to income of
approximately $479,000 (revised in the quarter ended June 30, 1996, from the
original estimate of $592,000 recorded in the quarter ended March 31, 1996)
based on the Black-Scholes option-pricing model. As of June 30, 1996, none of
these options have been exercised.
On January 31, 1996, the Company's Board of Directors granted non-statutory
stock options to acquire an aggregate of 312,620 shares of Common Stock at an
exercise price of $8.125 per share to directors and employees under the 1995
Stock Option Plan. These options were fully vested as of the date of the grant
and expire on January 30, 2004. As of June 30, 1996, none of these options have
been exercised.
On January 31, 1996, a previously granted incentive stock option to purchase
50,000 shares of Common Stock was terminated in accordance with its terms, prior
to the vesting of any shares subject to such option.
On February 1, 1996, the Company's Board of Directors granted incentive stock
options to acquire 5,000 shares of Common Stock at an exercise price of $8.125
per share to employees under the 1995 Stock Option Plan. These options vest one
year from the grant date and expire on January 31, 2004. As of June 30, 1996,
none of these options have been exercised.
8
<PAGE> 10
PART I - FINANCIAL INFORMATION
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
PLANET POLYMER TECHNOLOGIES, INC.
Overview
Except for the historical information contained herein, the discussion of this
report contains forward looking statements that involve certain risks and
uncertainties. The Company's actual results could differ materially from those
discussed in this report. Factors that could cause or contribute to such
differences include, but are not limited to, those discussed in the Company's
Form 10-KSB for the fiscal year ended December 31, 1995 in "Item 1 - Description
of Business," including the section therein entitled "Risk Factors," and "Item 6
- - Management's Discussion and Analysis of Financial Condition and Results of
Operations."
Planet Polymer Technologies, Inc. (the "Company" or "Planet") emerged from the
development stage as a result of its acquisition of Deltco of Wisconsin, Inc.
("Deltco"), effective January 1, 1996. Prior to this acquisition, substantially
all of the Company's resources had been devoted to the development and
commercialization of its seven Enviroplastic technologies and products.
Research and development and marketing expenses are expected to increase
significantly in the future as the Company's Enviroplastic products are
commercialized and continued efforts are focused on Deltco's resins. General and
administrative expenses are not expected to increase significantly in the next 6
months.
Deltco is a manufacturer and reprocessor of thermoplastic scrap resins located
in Ashland, Wisconsin. The Company intends to continue to use Deltco's plant,
equipment and other physical property in the manner in which it was used prior
to the acquisition. In addition, the Company plans to leverage its Enviroplastic
technologies and sales and marketing expertise with Deltco's manufacturing
experience.
Planet has incurred operating losses since inception and has an accumulated
deficit at June 30, 1996 of approximately $5.8 million. Pending commercial
deployment of and related volume orders for the Company's Enviroplastic
products, the Company expects to incur additional losses.
Results of Operations
Three months ended June 30, 1995 and 1996
The Company's revenues increased from approximately $86,000 during the three
months ended June 30, 1995 to approximately $954,000 during the three months
ended June 30, 1996. This increase primarily reflects the acquisition by Planet
of Deltco. The Company continued to focus on internally-funded, rather than
customer-funded, product development of the Company's Enviroplastic products
during the three months ended June 30, 1996. The Company will continue to
participate in customer-funded development when appropriate, but believes
internally-funded development is advantageous as to certain technologies and
applications.
9
<PAGE> 11
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS - (CONTINUED)
PLANET POLYMER TECHNOLOGIES, INC.
Results of Operations, Continued
General and administrative expenses were relatively unchanged for the three
months ended June 30, 1996 compared to the three months ended June 30, 1995.
This was primarily attributable to the downward revision (approximately
$114,000) of the 1st Quarter estimated non-cash compensation expense for the
fair value of options granted to an outside consultant, offset by increased
expenditures related to the anticipation of commercial scale-up activities
associated with the Company's status as a public company and the related
reporting requirements.
Marketing expenses decreased approximately $106,000 for the three months ended
June 30, 1996 compared to the three months ended June 30, 1995. This decrease
primarily reflects a reduction in professional fees ($137,000), partially offset
by the addition of sales and marketing personnel and efforts focused on
establishing international joint ventures in anticipation of the
commercialization of the Company's products.
The Company's research and development expenses increased approximately $113,000
for the three months ended June 30, 1996 compared to the three months ended June
30, 1995. This increase is due primarily to increased efforts spent on refining
the Company's hydrodegradable and compostable products and related production
trials, and the addition of research personnel.
Research and development and marketing expenses are expected to increase
significantly in the future as the Company's Enviroplastic products are
commercialized and continued efforts are focused on Deltco's resins. General and
administrative expenses are not expected to increase significantly in the next 6
months.
The Company's net loss decreased from approximately $659,000 for the three
months ended June 30, 1995 to approximately $334,000 for the three months ended
June 30, 1996. This decrease was due primarily to an increase in sales for the
period (which resulted primarily from the Company's acquisition of Deltco) and a
$114,000 reduction of the 1st quarter estimate of a non-cash compensation
expense for the fair value of options granted to an outside consultant during
the quarter.
Six Months Ended June 30, 1995 and 1996
The Company's revenue increased from approximately $172,000 during the
six-months ended June 30, 1995 to approximately $1,649,000 during the six months
ended June 30, 1996. This increase primarily reflects the acquisition by Planet
of Deltco, offset by the Company's continued focus on internally-funded, rather
than customer-funded, product development of the Company's Enviroplastic
products during the six months ended June 30, 1996. The Company will continue to
participate in customer-funded development when appropriate, but believes
internally-funded development is advantageous as to certain technologies and
applications.
10
<PAGE> 12
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS - (CONTINUED)
PLANET POLYMER TECHNOLOGIES, INC.
General and administrative expenses increased by approximately $832,000 for the
six months ended June 30, 1996 compared to the six months ended June 30, 1995.
This increase is primarily due to a $479,000 one time, non-cash compensation
expense for the fair value of options granted to an outside consultant during
the 1st Quarter. In addition, increased expenditures related to the build-up of
administrative infrastructure in anticipation of commercial scale-up, additional
professional fees, activities associated with the Company's status as a public
company and the related reporting requirements, and the acquisition of Deltco
contributed to the increase.
Marketing expenses increased approximately $98,000 for the six months ended June
30, 1996 compared to the six months ended June 30, 1995. This increase is
primarily attributable to the addition of sales and marketing personnel, efforts
focused on increasing Deltco's customer base, and efforts focused on
establishing international joint ventures in anticipation of the
commercialization of the Company's products.
The Company's research and development expenses increased approximately $194,000
for the six months ended June 30, 1996 compared to the six months ended June 30,
1995. This increase is due to accelerated efforts spent on refining the
Company's hydrodegradable and compostable products and related production
trials, and the addition of research personnel.
The Company's net loss increased from approximately $929,000 for the six months
ended June 30, 1995 to approximately $1,507,000 for the six months ended June
30, 1996. This increase was due primarily to a $479,000 one time, non-cash
compensation expense for the fair value of options granted to an outside
consultant during the 1st Quarter, as well as increased expenditures related to
the build-up of administrative infrastructure, additional professional services,
the acquisition of Deltco and activities associated with the Company's status as
a public company.
11
<PAGE> 13
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS - (CONTINUED)
PLANET POLYMER TECHNOLOGIES, INC.
Liquidity and Capital Resources
Since inception, Planet has financed its operations primarily through the
private sale of equity securities and revenue from customer development
agreements. The Company has raised approximately $4 million (net of issuance
costs) from the private sale of Common Stock and exercise of warrants to
purchase Common Stock. In September 1995 the Company completed its initial
public offering in which it sold an aggregate of 1,150,000 shares of Common
Stock to the public and received net proceeds of approximately $5.6 million. In
January 1996, the Company used $1,125,000 in cash and issued 96,775 shares of
restricted Common Stock valued at approximately $508,000 to acquire Deltco in a
purchase transaction. In connection with the purchase, the Company now has one
outstanding debt agreement related to a Small Business Administration loan
collateralized by Deltco. As of June 30, 1996 the loan balance was approximately
$380,000. The Company has no material commitments for capital expenditures.
The Company has used approximately $1,475,000 for operations for the six months
ended June 30, 1996. Such funds have been used for research and development
activities, marketing efforts and administrative support.
The Company has used approximately $1,023,000 for investing activities for the
six months ended June 30, 1995. Such funds were used primarily to purchase
Deltco as well as to purchase short term investments for cash reserves.
The Company believes that the proceeds generated from its initial public
offering together with existing sources of liquidity and anticipated revenue,
including revenues generated from Deltco, will satisfy the Company's projected
working capital and other cash requirements through at least March, 1997. There
can be no assurance, however, that changes in the Company's plans or other
events affecting the Company's operating expenses will not result in the
expenditure of such resources before such time. The Company expects that it will
need to raise substantial additional funds to establish large-scale
manufacturing capabilities. The Company intends to seek additional funding from
existing and potential customers or through public or private equity or debt
financing. There can be no assurance that additional financing will be available
on acceptable terms, or at all.
11
<PAGE> 14
PART II - OTHER INFORMATION
PLANET POLYMER TECHNOLOGIES, INC.
Item 1 - Legal Proceedings:
None
Item 2 - Changes in Securities:
None
Item 3 - Defaults upon Senior Securities:
None
Item 4 - Submission of Matters to a Vote of Security Holders.
The Annual Meeting of Shareholders of Planet Polymer Technologies, Inc.
(the "Annual Meeting") was held on May 21, 1996 in San Diego,
California.
Proposal 1 - Election of Directors
Each of the candidates listed below were duly elected to the Board of
Directors at the Annual Meeting by the tally indicated.
<TABLE>
<CAPTION>
Candidate Votes in Favor Votes Withheld
--------- -------------- --------------
<S> <C> <C> <C>
Robert J. Petcavich, Ph.D. 4,320,749 8,000
Brian To 4,320,749 8,000
Michael V. Pundeff 4,320,749 8,000
Michael M. Coleman, Ph.D. 4,320,749 8,000
</TABLE>
Proposal 2 - Ratification of Selection of Independent Auditors
<TABLE>
<CAPTION>
Votes in Favor Votes Against Votes Abstained
<S> <C> <C> <C>
4,301,214 0 21,535
</TABLE>
Item 5 - Other Information:
None
Item 6 - Exhibits and Reports on Form 8-K:
(a) 1. Financial Statements. Financial statements are included as
Part I, Item 1 of this report.
2. Financial Statement Schedules. All schedules are omitted since
the required information is not present or is not present in
amounts sufficient to require a submission of the schedules,
or because the information required is included in the
financial statements and notes thereto.
3. Exhibits.
Exhibit Number Description
-------------- -----------
27.1 Financial Data Schedule
(b) Reports on Form 8-K:
None
13
<PAGE> 15
PLANET POLYMER TECHNOLOGIES, INC.
SIGNATURES
In accordance with the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Date: 7/31/96 Planet Polymer Technologies, Inc.
/S/ROBERT J. PETCAVICH
-----------------------------------------------
President, Chief Executive Officer and Director
(Principal Financial and Accounting Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Company's unaudited June 30, 1996 Balance Sheet and Statement of Operations for
the six months ended June 30, 1996 and is qualified in its entirety by reference
to such statements as filed in the Company's Form 10-QSB for the six months
ended June 30, 1996.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> JUN-30-1996
<CASH> 697,903
<SECURITIES> 1,910,278
<RECEIVABLES> 694,436
<ALLOWANCES> (10,000)
<INVENTORY> 291,590
<CURRENT-ASSETS> 3,619,426
<PP&E> 1,602,825
<DEPRECIATION> (715,955)
<TOTAL-ASSETS> 5,506,902
<CURRENT-LIABILITIES> 424,123
<BONDS> 244,007
0
0
<COMMON> 10,686,579
<OTHER-SE> (5,847,807)
<TOTAL-LIABILITY-AND-EQUITY> 5,506,902
<SALES> 1,648,872
<TOTAL-REVENUES> 1,648,872
<CGS> 971,134
<TOTAL-COSTS> 971,134
<OTHER-EXPENSES> 2,234,081
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (1,506,694)
<INCOME-TAX> 0
<INCOME-CONTINUING> (1,556,343)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (1,506,694)
<EPS-PRIMARY> (0.29)
<EPS-DILUTED> (0.29)
</TABLE>
