SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[X] Quarterly Report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 for the quarterly period ended:
March 31, 1998
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: 33-64142
United States Leather, Inc.
(Exact name of registrant as specified in its charter)
Wisconsin 13-3503310
(State or other jurisdiction of (I.R.S. Employer
incorporation) Identification No.)
1403 West Bruce Street, Milwaukee, WI 53204
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (414) 383-6030
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.
Yes X No
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Shares Outstanding
Class at March 31, 1998
Common Stock, 100
$.01 par value
As of March 31, 1998, there was no public market for the Company's common
stock.
<PAGE>
UNITED STATES LEATHER, INC.
INDEX
Page
Number
PART I - FINANCIAL INFORMATION
Item 1 Financial Statements (Unaudited)
Consolidated Condensed Statements of Operations . . . . . . . 3
Consolidated Condensed Balance Sheets . . . . . . . . . . . . 4
Consolidated Condensed Statements of Cash Flows . . . . . . 5-6
Notes to Consolidated Condensed Financial Statements . . . . 7
Item 2 Management's Discussion and Analysis of
Financial Condition and Results of Operations . . . . . 11
PART II - OTHER INFORMATION AND SIGNATURES
Item 6 Exhibits and Reports on Form 8-K . . . . . . . . . . . . . . . 16
Signatures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
<PAGE>
UNITED STATES LEATHER, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF OPERATIONS (UNAUDITED)
(Amounts in Thousands, Except Share and Per Share Data)
3 Months Ended
March 31,
1998 1997
Net sales $65,012 $83,379
Cost of sales 61,302 79,919
------- -------
Gross profit 3,710 3,460
Selling, general and administrative
expenses 5,360 6,066
Amortization of intangible assets 172 882
------- -------
Loss from operations (1,822) (3,488)
Interest expense 5,935 4,497
------- -------
Loss before taxes (7,757) (7,985)
Income tax expense (benefit) 47 (2,494)
------- -------
Net loss $(7,804) $(5,491)
======= =======
Net loss per share (basic and diluted) $(78,040) $(54,910)
======= =======
Weighted average shares outstanding
(basic and diluted) 100 100
======= =======
<PAGE>
UNITED STATES LEATHER, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS (UNAUDITED)
(Amounts in Thousands, Except Share and Per Share Data)
As of As of
March 31, December 31,
1998 1997
Current Assets:
Cash $1,130 $1,054
Accounts receivable, less allowances of
$2,439 and $2,892 41,400 32,336
Inventories 40,395 43,330
Prepaid expenses and other 399 822
------- -------
Total current assets 83,324 77,542
Property, plant and equipment, net 41,394 42,380
Other 5,096 6,280
------- -------
Total assets $129,814 $126,202
======= =======
Current Liabilities:
Current maturities of long-term debt $130,103 $130,144
Revolving credit facility 45,928 37,932
Payable to bank 2,242 1,778
Accounts payable 8,328 7,335
Accrued liabilities 20,533 18,438
------- -------
Total current liabilities 207,134 195,627
Long-term debt, less current maturities - -
Other long-term liabilities 8,803 8,843
Stockholder's Equity:
Preferred Stock, $.01 par value -
5,000,000 shares authorized,
no shares issued - -
Common Shares:
Common Stock, voting, $.01 par
value - 35,000,000 shares
authorized, 100 shares issued 1 1
Additional paid-in-capital 92,344 92,344
Other Comprehensive Income (146) ( 95)
Accumulated deficit (178,322) (170,518)
------- -------
Total stockholder's equity (86,123) (78,268)
------- -------
Total liabilities and stockholder's equity $129,814 $126,202
======= =======
The accompanying notes are an integral part of these statements.
<PAGE>
UNITED STATES LEATHER, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)
(Amounts in Thousands, Except Share and Per Share Data)
For The Three Months Ended
March 31,
1998 1997
Cash Flows from Operating Activities:
Net loss $(7,804) $(5,491)
Adjustments to reconcile net income
to net cash provided
by operating activities:
Depreciation and amortization 2,201 2,687
Noncash interest expense 1,581 166
Deferred income taxes - (2,494)
Change in assets and liabilities:
Accounts receivable (9,064) (14,009)
Inventories 2,935 (6,994)
Prepaid expenses and other (47) (379)
Accounts payable 993 1,772
Accrued liabilities 2,095 (2,459)
Income taxes payable - (101)
Other long-term liabilities (40) ( 17)
-------- ---------
Net cash used by operating activities (7,150) (27,319)
-------- ---------
Cash Flows from Investing Activities
Capital expenditures (1,196) (1,137)
Proceeds from sales of fixed assets 13 91
Purchase of software license - (130)
-------- --------
Net cash used in investing activities (1,183) (1,176)
-------- --------
Cash Flows from Financing Activities:
Payments of revolving credit facility ( 53,663) (15,605)
Borrowings under revolving credit
facility 61,659 44,596
Net change in payable to bank 464 (783)
-------- --------
Net cash provided by financing
activities 8,460 28,208
-------- --------
Effect of Exchange Rate Changes on
Cash (51) 10
-------- --------
Net increase (decrease) in cash 76 (277)
Cash, beginning of period 1,054 2,894
-------- -------
Cash, end of period $1,130 $2,617
======== =======
<PAGE>
UNITED STATES LEATHER, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)
(Amounts in Thousands, Except Share and Per Share Data)
For the three months ended
March 31,
1998 1997
Supplemental cash flow disclosures:
Interest paid $870 $7,573
Income taxes refunded (net) $25 $15
The accompanying notes are an integral part of these statements.
<PAGE>
UNITED STATES LEATHER, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
(Amounts in Thousands, Except Share and Per Share Data)
(Unaudited)
(1) Basis of Presentation:
The accompanying unaudited consolidated condensed financial statements
have been prepared in accordance with the rules and regulations of the
Securities and Exchange Commission. In the opinion of management, all
required disclosures have been presented and all necessary adjustments
(consisting only of normal recurring adjustments) have been included to
fairly present the results of operations, financial position and cash
flows of United States Leather, Inc. (the "Company"). These consolidated
condensed financial statements should be read in conjunction with the
Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1997.
(2) Net Loss Per Share:
Effective December 31, 1997, the Company adopted SFAS No. 128, "Earnings
Per Share."
Net loss per share (basic and diluted) is calculated by dividing the loss
by the weighted average number of the Company's shares of Common Stock,
$.01 par value, outstanding during the period. Diluted earnings per share
are the same as basic earnings per share for the three months ended March
31, 1998 and 1997 as there are no dilutive securities.
(3) Comprehensive Income:
In the firth quarter of 1998, the Company adopted SFAS 130, "Reporting
Comprehensive Income." The Company's Comprehensive Income consists solely
of foreign currency translation adjustments.
The accumulated Other Comprehensive Income balances are summarized as
follows:
Foreign Currency
Translation
Balance at December 31, 1997 $ (95)
Change during three months ended
March 31, 1998 $ (51)
-----
Balance at March 31, 1998 $(146)
=====
(4) Inventories:
Inventories consist of the following:
March 31, December 31,
1998 1997
At lower of cost, using the first-in, first-
out (FIFO) cost method or market:
Raw materials and supplies $10,834 $14,150
Work in process 17,271 17,322
Finished goods 17,781 17,975
------- -------
Total FIFO inventories 45,886 49,447
Difference between FIFO and LIFO cost
of inventories (5,491) (6,117)
------- -------
Total LIFO inventories $40,395 $43,330
======= =======
(5) Revolving Credit Agreement:
On January 14, 1998, the Company replaced its existing credit facility
with a new revolving credit facility (the "New Revolving Credit
Facility"), a $55,000 revolving facility which is secured by essentially
all the assets of the Company. Loans under the New Revolving Credit
Facility bear interest at a rate equal to prime plus 1.25% or LIBOR plus
3.00%. The Company pays a 0.375% commitment fee on the unused portion of
the facility. The terms of the agreement covering the New Revolving
Credit Facility require the Company to, among other things, beginning in
1999 maintain a minimum ratio of FIFO earnings before interest expense,
income tax expense, depreciation expense and amortization expense ("FIFO
EBITDA") to fixed charges, a minimum tangible net worth and minimum
EBITDA. The agreement also includes restrictions related to capital
expenditures and further indebtedness. Letters of credit of $2,624 as of
March 31, 1998, reduced available capacity under revolving credit
facilities to $3,637.
(6) Bankruptcy Proceedings
On May 11, 1998 the Company filed a voluntary petition for reorganization
under Chapter 11 of the United States Bankruptcy Code (the "Chapter 11
Petition") in the United States Bankruptcy Court for the Eastern District
of Wisconsin (the "Bankruptcy Court"), Case No. 98-24997, and also filed a
prenegotiated Plan of Reorganization (the "Plan") pursuant to which, among
other things, the Company's 10 1/4% Senior Notes due 2003 (the "Notes")
would be converted into shares of common stock representing 97% of the
Company's outstanding common stock, with the Company's existing common
stockholders receiving the remaining 3% of the Company's outstanding
common stock. Pursuant to a solicitation ending on May 6, 1998, the Plan
received the approval of holders of approximately $102 million aggregate
principal amount of the Notes, representing approximately 88% of the
holders who voted pursuant to the solicitation. The Plan was also
approved by the Company's common stockholders. The Company is managing
its business as debtor-in-possession subject to the supervision and
control of the Bankruptcy Court.
Although the Company had incurred losses in each of the last two years, it
believes that it has implemented measures which will stabilize operations
and permit it to reverse these losses and become profitable again within a
reasonable period of time. The capital restructuring provided by the Plan
represents an essential step in this stabilization and return to
profitability because it will (1) create greater liquidity and borrowing
capacity under the terms of the New Revolving Credit Facility, and (2)
enable the Company to compete more effectively and demand more favorable
terms from suppliers because uncertainties in its marketplace regarding
the Company's financial stability. There can be no assurances, however,
that the measures the Company has implemented nor the effect of the
restructuring, if approved, will be sufficient to permit it to remain an
ongoing concern.
(7) Asset Valuation Loss:
In the fourth quarter of 1997, the Company recorded an asset valuation
loss of $101.0 million consisting of $94.0 million of unamortized goodwill
and $7.0 million for assets held for sale. During the third quarter of
1997 the Company approved a plan to sell two of its operations: Caldwell
Moser Leather Co. and Berlin Leather. Both operations are part of the
Company's Footwear and Specialty Leather Group. The Company recorded a
pretax charge of $7.0 million in the third quarter to reduce the book
value of the long-lived assets (property, plant, equipment and goodwill)
of these operations to their estimated aggregated fair market value less
costs to sell based on a contingent selling arrangement with an investment
banker. The assets and sales of these two operations do not represent a
material portion of the Company's total assets or sales. The Company has
not sold these operations and, in January, took Caldwell Moser Leather Co.
off the market
Although the Company began implementing strategic measures in 1996 which
it believes will eventually improve the financial performance of the
Company, operating losses continued in 1996 and 1997. Pursuant to SFAS
No. 121 "Accounting for the Impairment of Long-Lived Assets and for Long-
Lived Assets to be Disposed Of', the Company deemed its long-lived assets
to be impaired as the future undiscounted cash flows of long-lived assets
would not be sufficient to recover the carrying value of such assets. The
assets therefore were adjusted to their fair value based on the estimated
present value of expected future cash flows. As a result, all unamortized
goodwill was written off with no reduction in the carrying amounts of
other long-lived assets.
(8) Pending Adoption of Accounting Announcement:
Effective December 31, 1998, the Company will adopt SFAS No. 131,
"Disclosure About Segments of an Enterprise and Related Information," and
SFAS No. 132, "Employers' Disclosure about Pensions and Other Post-
retirement Benefits." Both standards require additional disclosure in the
Notes to Consolidated Financial Statements but will not be material to the
consolidated financial statements.
<PAGE>
Item 2 - Management's Discussion and Analysis
of Financial Condition and Results of Operations
Special Note Regarding Forward-Looking Statements
Certain matters discussed herein are "forward-looking statements" within
the meaning of section 27A of the Securities Act of 1933 and Section 21E
of the Securities Exchange Act of 1934. These forward-looking statements
can generally be identified as such because the context of the statement
will include words such as Company "believes," "anticipates," "expects" or
words of similar import. Similarly, statements that describe the
Company's future plans, objectives or goals are forward-looking
statements. Such forward-looking statements are subject to certain risks
and uncertainties which are described in close proximity to such
statements and which could cause actual results to differ materially from
those currently anticipated. Readers are urged to consider these factors
carefully in evaluating the forward-looking statements and are cautioned
not to place undue reliance on such forward-looking statements. The
forward-looking statements made herein are only made as of the date of
this report and the Company undertakes no obligation to publicly update
such forward-looking statements to reflect subsequent events or
circumstances.
Recent Development; Bankruptcy Proceedings
On May 11, 1998 the Company filed a voluntary petition for reorganization
under Chapter 11 of the United States Bankruptcy Code (the "Chapter 11
Petition") in the United States Bankruptcy Court for the Eastern District
of Wisconsin (the "Bankruptcy Court"), Case No. 98-24997, and also filed a
prenegotiated Plan of Reorganization (the "Plan") pursuant to which, among
other things, the Company's 10 1/4% Senior Notes due 2003 (the "Notes")
would be converted into shares of common stock representing 97% of the
Company's outstanding common stock, with the Company's existing common
stockholders receiving the remaining 3% of the Company's outstanding
common stock. Pursuant to a solicitation ending on May 6, 1998, the Plan
received the approval of holders of approximately $102 million aggregate
principal amount of the Notes, representing approximately 88% of the
holders who voted pursuant to the solicitation. The Plan was also
approved by the Company's common stockholders. The Company is managing
its business as debtor-in-possession subject to the supervision and
control of the Bankruptcy Court.
Selected Financial Data
The following table sets forth certain consolidated income statement data
of the Company as a percentage of net sales for the periods indicated.
Percentage of Net Sales
Three Months Ended
March 31,
1998 1997
Net sales 100.0% 100.0%
Cost of sales 94.3 95.8
----- -----
Gross profit 5.7 4.2
Selling, general & administrative 8.1 7.3
Restructuring expenses 0.1 -
Amortization of intangible assets 0.3 1.1
----- -----
Income (loss) from operations (2.8) (4.2)
Interest expense 9.1 5.4
----- -----
Loss before taxes (11.9) (9.6)
Income tax expense (benefit) 0.1 (3.0)
----- -----
Net loss (12.0)% (6.6)%
===== =====
Results of Operations - Three Month Period
Ended March 31, 1998
Sales
The Company sells finished leather operations are divided into three
principal markets. The following chart summarizes the Company's sales by
product line:
Three Months Ended March 31,
1998 1997 %
Furniture Group $19.1 $20.7 (7.7)%
Automotive Group 11.5 13.7 (16.1)
Footwear & Specialty
Leather Group 34.4 47.7 (27.9)
----- -----
Continuing Sales 65.0 82.1 (20.8)
Discontinued Operations - 1.3 (100.0)
----- -----
Total Sales $65.0 $83.4 (22.1)
===== =====
During the third quarter of 1997, the Company discontinued the manufacture
and sale of food-quality collagen form its facilities in Omaha, Nebraska.
Prior to discontinuation, collagen sales were $1.3 million during the
first quarter of 1997.
Results of Operations
General. The Company experienced a loss of $7.8 million in the first
quarter of 1998, compared with a loss of $5.5 million during the same
period in the prior year. The principal reason for the increased loss is
the Company's decision, in June 1997, to discontinue making provisions for
tax benefits stemming from continued operating losses. In addition, a
weak retail market in the Footwear & Specialty Leather Group led to lower
than expected sales volumes during the first quarter of 1998 which
negatively impacted operating results, more than offsetting the favorable
effects of hide prices which had declined during the first quarter of
1998.
Net Sales. The Company's net sales in the first quarter of 1998 were
$65.0 million, a decrease of $18.4 million or 22.1% from the same period
one year ago. Sales from continuing operations decreased $17.1 million
or 20.8%. The decrease in the first quarter was principally due to lower
volumes in the Automotive Group and a weak retail market in the Furniture
Group and Footwear and Specialty Leather Group.
Furniture Group. Furniture Group sales during the first quarter were
$19.1 million, a decrease of $1.6 million or 7.7% from the first quarter
of 1997. Contributing to the decline was a downturn in retail furniture
sales and market share loss in some of the Group's product lines because
of lower-priced foreign competition.
Automotive Group. Automotive Group first quarter sales were $11.5
million or $2.2 million lower than the prior year quarter. The decrease is
primarily attributable to contract terminations which occurred in the
second quarter of 1997.
Footwear and Specialty Leather Group. Footwear and Specialty Leather
Group sales were $34.4 million during the first quarter of 1998, a
decrease of $13.3 million or 27.9% from the first quarter of 1997.
Weakened retail footwear demand and share lost to competition was the
principal reason for the decrease from the first quarter of 1997.
Uncertainties concerning the Company's ability to successfully restructure
its debt have had an adverse affect on its ability to preserve share in
the footwear market
Gross Profit. Gross profit for the first quarter of 1998 was $3.7
million, an increase of $0.2 million or 5.7% from the first quarter of
1997. Several factors favorably impacted gross profit for the first
quarter of 1998, including decreased hide prices and positive effects from
management's operational adjustments made in response to lower sales
volumes in all business groups.
Selling, General and Administrative Expenses. Selling, general and
administrative expenses during the first three months of 1998 were $0.7
million lower than the same period of 1997. The principal reasons for
this decrease was lower staffing, reduced sales commission expense due to
lower sales volume and a reduction in professional fees paid.
Earnings before Interest, Taxes, Depreciation and Amortization.
Earnings before interest, taxes, depreciation and amortization (and
provisions for LIFO revaluations) ("FIFO EBITDA") during the first quarter
of 1998 were a $0.1 million loss compared to a 0.4 million loss in the
first quarter of 1997. FIFO EBITDA is not determined pursuant to generally
accepted accounting principles ("GAAP"), and should not be considered in
isolation or as an alternative to GAAP-derived measurements
Amortization of Intangible Assets. Amortization of intangible assets
was $0.2 million in the first three months of 1998 compared to $0.9
million in the same period of 1997. The decrease is due to the Company's
write off all of its goodwill in the fourth quarter of 1997.
Interest Expense. Interest expense increased $1.4 million during the
first three months of 1998 over the same period in 1997. The principal
reason for this increase between years is the write off of deferred
financing expenses related to the revolving credit facility replaced in
January 1998 by the New Revolving Credit Facility.
Loss Before Income Taxes. The Company incurred a loss before taxes of
$7.8 million in the first quarter of 1998, a decrease of $0.2 million from
a $8.0 million loss before taxes incurred in the first quarter of 1997.
Income Tax Benefit. In accordance with SFAS No. 109, "Accounting for
Income Taxes", the Company recorded no tax benefit for the first quarter
of 1998 due to uncertainty regarding the realization of such tax benefits,
compared to a benefit of $2.5 million recorded during the same period of
1997.
Net Loss. Due to the factors previously discussed, the Company had a
net loss of $7.8 million in the first quarter of 1998, compared to a net
loss of $5.5 million during the first quarter of 1997.
Liquidity and Capital Resources. Since the filing of the Chapter 11
Petition, the Company has been managing its business as a debtor-in-
possession subject to control and supervision of the Bankruptcy Court.
Substantially all of the Company's assets were pledged to secure the New
Revolving Credit Facility, and therefore the Company was required to obtain
Bankruptcy Court authorization to use these assets, including cash
collateral. The Bankruptcy Court has issued an interim order authorizing,
and the Company has entered into, a $52.5 million debtor-in-possession
credit facility secured by substantially all of the assets of the Company
that replaces the New Revolving Credit Facility. The Company has
petitioned the Bankruptcy Court for and expects to receive other
authorizations necessary to continue to operate its business.
The Company used $7.2 million of cash for operations during the first
three months of 1998, compared with $27.3 million during the same period
of 1997. The principal reasons for change in cash flow were a $4.9
million comparative decrease in accounts receivable, a $9.9 million
comparative decrease in inventory, and a $3.8 million comparative decrease
in accounts payable and accrued liabilities. Accounts receivable
increased by $9.1 million during the first quarter of 1998. Days sales
outstanding in accounts receivable as of March 31, 1998 were 57 compared
with 52 days as of March 31, 1997. LIFO inventories decreased
approximately $2.9 million during the first quarter of 1998. The decrease
was due principally to better asset management and improved quality.
Capital expenditures totaled $1.2 million during the first quarter of
1998. This represents a increase of approximately $0.1 million from the
same period in 1997.
On January 31, 1998, the Company failed to make the semi-annual
interest payment which was due on its Notes and, as a consequence,
reclassified the Notes from long term debt to current liabilities. The
Company does not have the capital resources necessary to satisfy this
liability and, as a result, the Company filed the Chapter 11 Petition
after receiving the required approval of the Plan from the holders of the
Notes and from the Company's common stockholders. Consequently,
uncertainties exist concerning the Company's ability to continue as a
going concern.
On March 31, 1998, the Company's aggregate indebtedness was $180.0
million. This consisted of $139.2 million of principal and accrued
interest on its 10-1/4% Senior Notes Due 2003 (the "Senior Debt") and $45.9
million due under the New Revolving Credit Facility. The New Revolving
Credit Facility was a $55 million facility which was secured by essentially
all the asset of the Company. Loan availability is based on the Company's
accounts receivable and inventory balances after certain exclusions.
Availability as of March 31, 1998 was $3.6 million.
<PAGE>
PART II - OTHER INFORMATION
Item 6 - Exhibits and Reports on Form 8-K
(a) Exhibits:
27 Financial Data Schedule (EDGAR Version only)
(b) Reports on Form 8-K:
(i) The Company filed a Form 8-K dated March 25, 1998 with
respect to the agreement in principal it reached with its
stockholders and an informal committee of holders of the
Company's 10 1/4% Senior Notes due 2003.
(ii) The Company filed a Form 8-K dated April 1, 1998 with
respect to the distribution of its Disclosure Statement
and related material to the holders of the Company's 10-1/4%
Senior Notes due 2003.
<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.
Date: May 13, 1998
UNITED STATES LEATHER, INC.
By /s/ Kinzie L Weimer
Kinzie L Weimer
Senior Vice President and Chief Financial
Officer (Signing on behalf of the
Registrant and as Chief Financial Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE FINANCIAL
STATEMENTS OF UNITED STATES LEATHER, INC. AS OF AND FOR THE THREE MONTHS ENDED
MARCH 31, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-START> JAN-01-1998
<PERIOD-END> MAR-31-1998
<CASH> 1,130
<SECURITIES> 0
<RECEIVABLES> 41,400
<ALLOWANCES> 2,439
<INVENTORY> 40,395
<CURRENT-ASSETS> 83,324
<PP&E> 87,294
<DEPRECIATION> (45,900)
<TOTAL-ASSETS> 129,814
<CURRENT-LIABILITIES> 207,134
<BONDS> 130,103
0
0
<COMMON> 1
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 129,814
<SALES> 65,012
<TOTAL-REVENUES> 65,012
<CGS> 61,302
<TOTAL-COSTS> 5,360
<OTHER-EXPENSES> 172
<LOSS-PROVISION> 453
<INTEREST-EXPENSE> 5,935
<INCOME-PRETAX> (7,757)
<INCOME-TAX> 47
<INCOME-CONTINUING> (1,822)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (7,804)
<EPS-PRIMARY> (78,040)
<EPS-DILUTED> (78,040)
</TABLE>
