FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 1996
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the transition period from ________ to ___________
Commission file number: 1-11794
E. W. Blanch Holdings, Inc.
State or other jurisdiction of (I.R.S. Employer
incorporation or organization Identification No.)
Delaware 41-1741779
E. W. Blanch Holdings, Inc.
3500 West 80th Street, Minneapolis, Minnesota 55431
612-835-3310
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 ofv1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No ____
APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes ____ No ____
(APPLICABLE ONLY TO CORPORATE REGISTRANTS)
Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date.
Title Outstanding
Common Stock par value $.01 per share 13,248,564
<PAGE>
Part I. Financial Information
Item 1. Financial Statements
E. W. Blanch Holdings, Inc.
Consolidated Statements of Income
(in thousands, except per share amounts)
Unaudited
Three months ended March 31,
------------------------------
1996 1995
------------------------------
Revenues:
Brokerage commissions and fees $ 24,136 $ 25,054
Investment income 1,742 1,776
------------------------------
Total revenues 25,878 26,830
Expenses:
Salaries and benefits 10,468 10,641
Travel and marketing 1,712 1,266
General and administrative 4,587 4,146
Amortization of goodwill 768 730
Interest and other expense 66 100
------------------------------
Total expenses 17,601 16,883
------------------------------
Income before taxes 8,277 9,947
Income taxes 3,171 3,880
------------------------------
Net income $ 5,106 $ 6,067
==============================
Net income per share $ 0.38 $ 0.44
==============================
Weighted average number of shares of Common
Stock outstanding 13,288 13,650
==============================
Cash dividends declared per share $ 0.10 $ 0.10
==============================
See accompanying notes.
1
<PAGE>
Part 1. Financial Information
Item 1. Financial Statements
E. W. Blanch Holdings, Inc.
Consolidated Balance Sheets
(in thousands)
March 31, December 31,
1996 1995
-------------------------------------
(Unaudited)
Assets
Current assets:
Cash and cash equivalents $ 2,372 $ 4,977
Due from fiduciary accounts 10,558 4,537
Premium finance notes 14,375 12,212
Prepaid insurance 675 1,212
Other current assets 1,438 2,117
-------------------------------------
Total current assets 29,418 25,055
Long-term investments, available for sale 7,023 7,035
Property and equipment, net 9,521 9,386
Goodwill, net 39,080 38,939
Other assets 2,477 2,143
Fiduciary accounts--assets 433,938 414,855
=====================================
Total assets $ 521,457 $ 497,413
=====================================
Liabilities and Shareholders' equity
Current liabilities:
Accrued compensation $ 2,000 $ 3,311
Notes payable to banks 4,500 4,500
Accounts payable 2,788 3,848
Current portion of long-term liabilities 562 582
Other current liabilities 4,279 1,379
-------------------------------------
Total current liabilities 14,129 13,620
Long-term debt, less current portion 25 350
Deferred income taxes 1,487 1,320
Other liabilities, less current portion 529 589
Fiduciary accounts--liabilities 433,938 414,855
-------------------------------------
Total liabilities 450,108 430,734
Shareholders' equity 71,349 66,679
=====================================
Total liabilities and shareholders' equity $ 521,457 $ 497,413
=====================================
See accompanying notes.
2
<PAGE>
Part 1. Financial Information
Item 1. Financial Statements
E. W. Blanch Holdings, Inc.
Consolidated Statements of Cash Flows
(in thousands)
Unaudited
Three months ended March 31,
1996 1995
-----------------------------------
Operating Activities
Net income $ 5,106 $ 6,067
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 1,403 1,206
Equity in the earnings of Swire Blanch (147) (44)
Changes in operating assets and
liabilities:
Due from fiduciary accounts (6,021) (1,072)
Other current assets 590 (86)
Accrued compensation (1,311) (744)
Accounts payable and other
current liabilities 1,985 (715)
Other, net 189 25
-----------------------------------
Net cash provided by operating activities 1,794 4,637
Investing Activities
Purchases of property and equipment (759) (938)
Issuance of finance notes receivable, net (2,173) (2,445)
Other investing activities, net (374) (159)
-----------------------------------
Net cash used in investing activities (3,306) (3,542)
Financing Activities
Proceeds from sale of treasury shares 766 -
Dividends paid (1,321) (1,365)
(Repayments) borrowings on lines
of credit, net (43) 320
Payments on long-term debt (541) (298)
Other financing activities, net 46 41
-----------------------------------
Net cash (used in) provided by
financing activities (1,093) (1,302)
-----------------------------------
Net (decrease) in cash and cash equivalents (2,605) (207)
Cash and cash equivalents at
beginning of period 4,977 1,338
-----------------------------------
Cash and cash equivalents at end of period $ 2,372 $ 1,131
===================================
See accompanying notes.
3
<PAGE>
Part 1. Financial Information
Item 1. Financial Statements
E. W. Blanch Holdings, Inc.
Notes to Consolidated Financial Statements
March 31, 1996
1. Organization and Basis of Presentation
The accompanying unaudited consolidated financial statements have been prepared
in accordance with generally accepted accounting principles for interim
financial information and in accordance 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 interim periods are
not necessarily indicative of the results for the full year. For further
information, refer to the consolidated financial statements and footnotes
thereto included in the Company's annual report to shareholders for the year
ended December 31, 1995.
E.W. Blanch Holdings, Inc. ("the Company") and its predecessor organizations
have been in operation since 1957. The Company is a leading provider of
integrated risk management and distribution services including reinsurance
intermediary services, risk management consulting and administration services,
and wholesale insurance services.
The consolidated financial statements include the accounts of the Company and
its subsidiaries. The Company categorizes its business operations into three
segments: reinsurance services, wholesale insurance services and general
corporate services. The principal subsidiaries comprising the reinsurance
services segment include E.W. Blanch Co., Inc., Paragon Reinsurance Risk
Management Services, Inc., E.W. Blanch Capital Risk Solutions, Inc., and E.W.
Blanch International, Inc. (which owns a 50% interest in Swire Blanch Holdings,
Ltd., a joint venture with Swire Fraser Insurance (Holdings) Ltd.). The
principal subsidiary comprising the wholesale insurance segment is E.W. Blanch
Wholesale Insurance Services, Inc., which includes its operating subsidiaries
Blanch Insurance Services, Inc., Medical Reinsurance Corporation, Spectrum
National Insurance Resources (Spectrum), and InsGroup Services Company
(InsGroup). General corporate services includes investment income from corporate
investments, corporate expenses such as legal, finance, corporate development,
and the office of the chief executive, and results of other insignificant
operations.
2. Subsequent Event
On April 29, 1996, the Company's previous $25.0 million line of credit facility
with a syndicate of banks, including Norwest Bank Minnesota, N.A., Nations Bank
of Texas N.A., and Morgan Guaranty Trust Company of New York, expired. The
Company renewed a $30.0 million facility with the same syndicate of banks for a
term of three years. The facility includes two borrowing methods: short term
based on a floating rate at 75 basis points less than the base rate and longer
term (30, 60, or 90 days) at 75 basis points over the LIBOR rate. The base rate
is defined as the greater of the prime rate or 150 basis points over the federal
funds rate. Additionally, the Company pays a commitment fee of 25 basis points
on unused balances.
4
<PAGE>
E. W. Blanch Holdings, Inc.
Management's Discussion and Analysis of Financial Condition
and Results of Operations
For the Three Months Ended March 31, 1996
Forward Looking Statements. Except for the historical information contained
herein, the matters discussed in this quarterly report on Form 10-Q are forward
looking statements that involve risks and uncertainties, many of which are
outside the Company's control and, accordingly, actual results may differ
materially. The Company's Form 8-K filed with the SEC on March 22, 1996 includes
a discussion of these risk factors and is incorporated herein by reference.
General
The Company is a leading provider of integrated risk management and distribution
services including reinsurance intermediary services, risk management consulting
and administration services, and wholesale insurance services. The Company
categorizes its business operations into three segments: reinsurance services,
wholesale insurance services, and general corporate services. The following is a
summary of the revenues and pretax income (loss) of each business segment for
the periods indicated (in thousands):
Quarter Ended March 31, 1996
Brokerage Pre-tax
commissions Investment Total income
and fees Income Revenues (loss)
----------- ---------- --------- ---------
Reinsurance services $20,569 $1,060 $21,629 $10,472
Wholesale insurance services 3,567 614 4,181 (679)
General corporate services - 366 366 (1,516)
Eliminations - (298 (298) -
----------- ---------- --------- ---------
$24,136 $1,742 $25,878 $8,277
=========== ========== ========= =========
Quarter Ended March 31, 1995
Brokerage Pre-tax
commissions Investment Total income
and fees Income Revenues (loss)
----------- ---------- --------- ---------
Reinsurance services $20,629 $1,040 $21,669 $12,060
Wholesale insurance services 4,425 504 4,929 (149)
General corporate services - 232 232 (1,964)
----------- ---------- --------- ---------
$25,054 $1,776 $26,830 $ 9,947
=========== ========== ========= =========
Reinsurance services continue to be the primary source of the Company's revenues
and pre-tax income, and include the reinsurance intermediary services provided
by E. W. Blanch Co., Inc. (EWB Co.), the risk management services provided by
Paragon Reinsurance Risk Management Services, Inc. (Paragon) and E.W. Blanch
Capital Risk Solutions, Inc. (Capital Risk Solutions), and the 50% interest in
the international reinsurance services of Swire Blanch Holdings Limited.
Wholesale insurance services include the wholesale insurance distribution,
alternative distribution and premium finance services provided by Blanch
Insurance Services, Inc., the program business conducted by Spectrum, and the
association dues and distribution of specialized insurance products business
strategy of InsGroup, which was acquired on January 1, 1996. Also included in
the wholesale segment effective January 1, 1996, is EWB Co.'s unit which
specializes in life, accident/health and medical professional liability
reinsurance. The operations of this unit were combined with Medical Reinsurance
Corporation, a wholly owned subsidiary of E.W. Blanch Wholesale Insurance
Services, Inc., and the combined operation has the capability to produce,
underwrite and place insurance and reinsurance on behalf of accident/health and
medical professional liability companies. Prior year segment information has
been restated to conform with the current year presentation. This unit
contributed $0.1 million and $0.4 million of pre-tax income in the quarters
ended March 31, 1996 and 1995, respectively.
General corporate services includes investment income from corporate
investments, corporate expenses such as legal, finance, corporate development,
and the office of the chief executive, and results of other insignificant
operations.
5
<PAGE>
Reinsurance services revenues for the first quarter of 1996 are down slightly
from the first quarter of 1995 due primarily to continuing competitive market
conditions and a reduction in catastrophe contract premium adjustments. This
revenue decline, combined with an increase in expenses, resulted in a reduction
in pre-tax income for the first quarter of 1996 compared to the same period a
year ago. Despite the lower first quarter results and based on several
significant production opportunities, the company remains optimistic about its
ability to grow the revenues and earnings of its core reinsurance services
business.
The wholesale insurance business continued to show unprofitable results during
the first quarter of 1996. The Company believes that its efforts to reposition
the general agency book of business are beginning to take effect, and expects an
increase in written premium and commission and fee revenue levels during 1996
from the levels shown for the first quarter. The expected turnaround in the
general agency business combined with excellent opportunities in the alternative
distribution area leads the Company to believe that the wholesale insurance
services business will grow and become profitable in 1996. However, there can be
no assurances as to such future profitability.
The Company is engaged as the lead reinsurance intermediary by the California
Earthquake Authority (the "CEA"). The California Legislature failed to approve
legislation necessary to establish the CEA by its deadline of March 31, 1996. An
extension of time through April 30, 1996 was sought with the reinsurance
marketplace, but that deadline has also passed by without approval of the
necessary legislation. This legislation continues to be worked on by a
conference committee of the California Legislature.
The Company understands that the CEA transaction also requires participation by
insurers representing at least 75% of California's residential earthquake
market, and that the CEA requires a tax-exempt status ruling from the Internal
Revenue Service. It is uncertain what the current participation levels are
relative to the 75% benchmark and how such participation levels may be affected
by further legislative delays and the ultimate content of the bill. The Internal
Revenue Service has also given notice that its tax-exempt status ruling is
withdrawn pending further review of the ultimate legislation. Finally, the
legislative delays have also resulted in losses of capacity commitments from the
reinsurance marketplace, and the impact of further delays on such capacity
levels is unknown.
The Company remains optimistic that the CEA legislation will pass and the
transaction will be completed; however, it is a complex process and there can be
no assurances given that this will happen or when it will happen.
The Company continues to be involved with significant alternative distribution
opportunities. These opportunities are currently in various stages of
negotiations among the parties and state approval processes in order to reach a
final agreement. There were no significant revenues recorded during the first
quarter related to these alternative distribution opportunities, and nothing
significant is expected for the second quarter. The Company remains optimistic
that these alternative distribution opportunities will begin to generate
meaningful revenues later in 1996, but no assurances can be given as to the
completion of these transactions or the timing.
The Company plans to continue to increase its expenditures in the development of
risk management services through the expansion of Capital Risk Solutions as well
as its catastrophe modeling and consulting capabilities.
First Quarter 1996 Compared with First Quarter 1995
Reinsurance Services
The following are the components of Brokerage commissions and fees for the
reinsurance services segment for the quarter ended March 31 (in thousands):
Quarter ended March 31,
---------------------------------------------
1996 1995
------------------- -------------------
Reinsurance brokerage $19,833 $20,131
Risk management fees 589 454
Equity in Swire Blanch 147 44
=================== ===================
$20,569 $20,629
=================== ===================
Reinsurance brokerage decreased $0.3 million, or 1.4%, to $19.8 million for the
quarter ended March 31, 1996 compared to $20.1 million the prior year. The
components of the net decrease were as follows: new business production, $2.8
million, offset by non-continuing business, $2.6 million, declines on existing
business, $0.4 million, and other net decreases, $0.1 million. The $0.4 million
decline on existing business is attributed to a reduction in catastrophe
contract premium adjustments and continuing competitive market conditions offset
by other net increases in clients' ceded volume.
6
<PAGE>
Risk management fees were $0.6 million for the quarter ended March 31, 1996
compared to $0.5 million the prior year. These revenues were earned primarily
from a contract to administer the Florida Hurricane Catastrophe Fund.
Equity in the income of Swire Blanch was $147,000 for the quarter ended March
31, 1996 compared to $44,000 the prior year. New Swire Blanch offices were
opened in Rome and Mexico City during the first quarter. A new office is planned
to open in Hong Kong during the second quarter.
Fiduciary investment income was $1.0 million for the quarters ended March 31,
1996 and 1995. The average balance for the quarter ended March 31, 1996 was
$75.8 million compared to $74.8 million at March 31, 1995. The average yield was
5.6% for both periods.
Expenses increased 13.3% for the quarter ended March 31, 1996 primarily due to
increases in salaries and benefits as a result of key staff additions in the
risk management services area (primarily in Capital Risk Solutions and Paragon's
Catastrophe Modeling and Consulting Group) and normal salary progressions. Other
expense increases were experienced in travel and marketing, office rent, and
amortization of internally developed software.
Wholesale Insurance Services
The following are the components of Brokerage commissions and fees for the
wholesale insurance services segment for the quarter ended March 31 (in
thousands):
Quarter ended March 31,
--------------------------------
1996 1995
-------------- --------------
General agency commissions and fees $2,465 $ 3,078
Medical Reinsurance Corporation
commissions and fees 955 1,347
Other commissions and fees 147 -
============== ==============
$3,567 $4,425
============== ==============
General agency commissions and fees declined $0.6 million, or 19.9%, to $2.5
million for the quarter ended March 31, 1996 compared to $3.1 million for the
quarter ended March 31, 1995, due primarily to declines in personal lines
business. Total written premium and fees for the quarter ended March 31, are as
follows (in thousands):
Quarter ended March 31,
--------------------------------------------------
1996 1995
----------------------- -----------------------
Written Written
premium % of premium % of
and fees Total and fees Total
---------- ------- ---------- -------
Commercial lines $ 7,596 49.4% $ 8,073 41.3%
Special risks 4,632 29.6 4,581 23.5
Personal lines 2,729 11.5 5,365 27.5
NAFTA/Mexican National 473 3.2 1,501 7.7
---------- ------- ---------- -------
$15,430 100.0% $19,520 100.0%
========== ======= ========== =======
Medical Reinsurance Corporation commissions and fees declined $0.4 million, or
29.1%, to $1.0 million for the quarter ended March 31, 1996 compared to $1.3
million the prior year. The decline from the prior year results primarily from
lost business.
Other commissions and fees result primarily from dues and fees earned by
InsGroup, acquired effective January 1, 1996. InsGroup is an association of more
than 80 independent property/casualty insurance agencies located throughout the
United States. The Company believes that the acquisition will enhance its
capabilities in the distribution of specialized insurance products. Also
included in this category are the commissions and fees earned by the program
placement operations of Spectrum.
7
<PAGE>
The following are the components of Investment income for the quarter ended
March 31, 1996 (in thousands):
Quarter ended March 31,
----------------------------------------
1996 1995
----------------- -----------------
Premium finance interest and fees $ 517 $ 435
Fiduciary investment income 97 69
----------------- -----------------
$ 614 $ 504
================= =================
Premium finance interest and fees increased $82,000, or 18.9%, to $0.5 million
for the quarter ended March 31, 1996 compared to $0.4 million the prior year.
The increase results from the continued growth of the outstanding balance of
premium finance accounts. The outstanding balance of premium finance notes was
$14.6 million at a weighted average rate of 12.6% at March 31, 1996, compared to
$12.2 million at 13.5% at December 31, 1995, and $9.1 million at 16.4% at March
31, 1995.
Fiduciary investment income increased slightly from the prior year as a result
of larger average balances. The average invested balance for the quarter was
$7.3 million compared to $5.0 million the prior year. The average yield was 5.6%
for both periods.
Expenses decreased 20.4% for the quarter ended March 31, 1996, compared to the
quarter ended March 31, 1995. This decrease is comprised primarily of reductions
in salary and benefits, resulting from the effects of staff reductions which
occurred in the second quarter of 1995, and general and administrative expenses,
resulting primarily from changes in claims processing. These expense reductions
are offset by the expenses associated with the InsGroup operations and an
increase in interest expense related to the growth in premium finance notes.
General Corporate Services and Eliminations
Corporate investment income of $0.4 million is comprised of $0.1 million of
interest income from investment securities and $0.3 million of inter-company
interest charged to the wholesale insurance segment to fund the premium finance
operation. Investment securities income declined $0.1 million, or 50%, to $0.1
million for the quarter ended March 31, 1996 compared to the prior year. This
decline is due to sales of securities in 1995, primarily to fund the October
1995 purchase of treasury stock, which resulted in a smaller investment
portfolio of $7.0 million at March 31, 1996, compared to $16.2 million at March
31, 1995. The Company has generally employed its available funds to generate
greater investment returns in its premium finance business rather than making
passive investments in securities.
Expenses increased 7.2% for the quarter ended March 31, 1996, compared to the
prior year. This increase results primarily from additional office space, losses
on the sale of real estate, and other net expense increases, offset by lower
incentive plan expense.
The Company's effective tax rate, after adjustment for equity in the income of
Swire Blanch which is already reflected on an after tax basis, continues to be
39%.
8
<PAGE>
Liquidity and Capital Resources
The Company's sources of funds consist primarily of brokerage commissions and
fees and investment income. Funds are applied generally to the payment of
operating expenses, to the purchase of equipment used in the ordinary course of
business, to the repayment of outstanding indebtedness and to the distribution
of earnings. The Company's cash and cash equivalents were $2.4 million at March
31, 1996. The Company's long-term investment portfolio at March 31, 1996 was
$7.0 million. The largest component of the portfolio is comprised of municipal
securities that are exempt from federal income taxes, are rated "AA" or better
by a major rating organization, and have an average maturity of 2.6 years with
an average yield of 5.0%. The Company also maintains some equity investments.
The market value of the Company's investment portfolio at March 31, 1996
approximates cost, compared to $0.1 million below cost at December 31, 1995.
Cash, short-term investments and the Company's line of credit are available and
managed for the payment of its operating and capital expenditures. The Company
is not subject to any regulatory capital requirements in connection with its
business.
The Company generated $1.8 million of cash from operations during the first
three months of 1996 compared with $4.6 million for the same period in 1995.
Cash provided by operating activities reflects the net income of the Company
adjusted for the non-cash charges of depreciation and amortization, equity in
the income of Swire Blanch, gains and losses on the sale of investment
securities and equipment, and changes in other working capital accounts. The
primary cause of the decline from the 1995 amount is an increase in amounts due
from fiduciary accounts.
Net cash used in investing activities was $3.3 million during the first three
months of 1996, compared with $3.5 million during the first three months of
1995. The 1996 amount includes net issuance of premium finance notes, $2.2
million, net purchases of property and equipment, $0.8 million, and other net
uses, $0.4 million. The 1995 amount includes the net issuance of $2.4 million of
premium finance notes and $0.9 million of net purchases of property and
equipment. Premium finance notes are part of the wholesale insurance operation.
The Company has increased its investments in computerized information systems in
an effort to improve information reporting and the efficient processing of its
business. The Company intends to continue to increase its investments in such
systems.
Net cash used in financing activities for the three months ended March 31, 1996
was $1.1 million and consisted primarily of $1.3 million in dividends paid to
shareholders offset by other net cash provided of $0.2 million. In the prior
year, net cash used by financing activities was $1.3 million, consisting
primarily of $1.4 million of cash dividends paid to shareholders and other net
cash provided of $0.1 million.
On April 29, 1996, the Company's previous $25.0 million line of credit with a
syndicate of banks, including Norwest Bank Minnesota, N.A., Nations Bank of
Texas N.A., and Morgan Guaranty Trust Company of New York, expired. The Company
renewed a $30.0 million facility with the same syndicate of banks for a term of
three years. The facility includes two borrowing methods: short term based on a
floating rate at 75 basis points less than the base rate and longer term (30,
60, or 90 days) at 75 basis points over the LIBOR rate. The base rate is defined
as the greater of the prime rate or 150 basis points over the federal funds
rate. Additionally, the Company pays a commitment fee of 25 basis points on
unused balances.
On January 25, 1996, the Board of Directors declared a regular quarterly cash
dividend of $0.10 per share, payable March 1, 1996 to shareholders of record as
of February 9, 1996. On April 25, 1996, the Board of Directors declared a
regular quarterly cash dividend of $0.10 per share, payable June 1, 1996 to
shareholders of record as of May 10, 1996.
9
<PAGE>
Part II. Other Information
Item 1. Legal Proceedings.
n/a
Item 2. Changes in Securities
n/a
Item 3. Defaults upon Senior Securities
n/a
Item 4. Submission of Matters to a Vote of Security Holders
n/a
Item 5. Other Information
n/a
Item 6. Exhibits and Reports on Form 8-K.
1. n/a
2. The company filed a Current Report on Form 8-K on March 22, 1996
pertaining to forward looking statements and prospective disclosures.
10
<PAGE>
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.
E. W. Blanch Holdings, Inc.
By: /s/ Tom S. Nelson
------------------------------------------------------
Tom S. Nelson
Executive Vice President and Chief Financial Officer
Date: May 14, 1996
11
<PAGE>
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<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> Dec-31-1996
<PERIOD-START> Jan-1-1996
<PERIOD-END> Mar-31-1996
<CASH> 2,372
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 29,418
<PP&E> 18,827
<DEPRECIATION> 9,306
<TOTAL-ASSETS> 521,457
<CURRENT-LIABILITIES> 14,129
<BONDS> 0
0
0
<COMMON> 141
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 521,457
<SALES> 24,136
<TOTAL-REVENUES> 25,878
<CGS> 0
<TOTAL-COSTS> 17,601
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 66
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<INCOME-TAX> 3,171
<INCOME-CONTINUING> 0
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<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 5,106
<EPS-PRIMARY> .38
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</TABLE>
