U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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 the quarterly period ended March 31, 1999
[ ] 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 0-24564
-------------------------
FIBERSTARS, INC.
(Exact name of registrant as specified in its charter)
-------------------------
California 94-3021850
---------- ----------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
2883 Bayview Drive, Fremont, CA 94538
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code): (510) 490-0719
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
------ ------
Number of shares of Common Stock outstanding as of March 31, 1999: 3,982,601
Index to Exhibits is at page 16
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FIBERSTARS, INC.
TABLE OF CONTENTS
Page
----
Part I - FINANCIAL INFORMATION
Item 1 Financial Statements:
a. Consolidated Balance Sheets
March 31, 1999 and December 31, 1998.......................3
b. Consolidated Statements of Operations
Three months ended March 31, 1999 and 1998.................4
c. Consolidated Statements of Comprehensive Operation
Three months ended March 31, 1999 and 1998.................5
d. Consolidated Statements of Cash Flows
Three months ended March 31, 1999 and 1998.................6
e. Notes to Financial Statements............................7-8
Item 2 Management's Discussion and Analysis of Financial
Condition and Results of Operations..........................9-14
Part II - OTHER INFORMATION
Item 6 Exhibits and Reports on Form 8-K...............................15
Signatures.....................................................15
EXHIBITS
Index to Exhibits..............................................16
Page 2
<PAGE>
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
<TABLE>
FIBERSTARS, INC.
CONSOLIDATED BALANCE SHEETS
(amounts in thousands)
<CAPTION>
March 31, December 31,
1999 1998
-------------- --------------
(unaudited)
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 529 $ 1,290
Accounts receivable, net 6,485 5,210
Notes and other receivables 631 771
Inventories 4,270 4,179
Prepaids and other current assets 396 369
Deferred income taxes 532 507
---------------- ----------------
Total current assets 12,843 12,326
Fixed assets, net 1,567 1,522
Goodwill 4,274 4,403
Investment in joint venture 18 18
Other assets 68 566
Deferred income taxes 89 89
-------------- --------------
Total assets $ 18,859 $ 18,924
================ ================
LIABILITIES
Current Liabilities:
Accounts payable $ 2,390 $ 2,598
Accrued liabilities 2,164 2,198
Current portion of long-term debt 99 107
---------------- ----------------
Total current liabilities 4,653 4,903
Long-term debt, less current portion 720 667
---------------- ----------------
Total liabilities 5,373 5,570
---------------- ----------------
SHAREHOLDERS' EQUITY
Common stock 0 0
Additional paid-in capital 13,930 13,930
Note receivable from shareholder (86) (86)
Cumulative translation adjustments (28) 0
Accumulated deficit (330) (490)
---------------- ----------------
Total shareholders' equity 13,486 13,354
---------------- ----------------
Total liabilities and shareholders' equity $ 18,859 $ 18,924
================ ================
<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
Page 3
<PAGE>
<TABLE>
FIBERSTARS, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(amounts in thousands except per share amounts)
(unaudited)
<CAPTION>
Three Months Ended March 31,
1999 1998
------------ ----------
<S> <C> <C>
Net sales $ 7,182 $ 4,659
Cost of sales 4,206 3,144
------------ ----------
Gross profit 2,976 1,515
------------ ----------
Operating expenses:
Research and development 329 306
Sales and marketing 1,858 1,278
General and administrative 543 402
------------ ----------
Total operating expenses 2,730 1,986
------------ ----------
Income (loss) from operations 246 (471)
Other income:
Interest income, net 4 63
------------ ----------
Income (loss) before income taxes 250 (408)
Benefit from (provision for) income taxes (90) 147
------------ ----------
Net income (loss) $ 160 $ (261)
============ ==========
Net income (loss) per share - basic $ 0.04 $ (0.07)
============ ==========
Shares used in per share calculation - basic 3,983 3,515
============ ==========
Net income (loss) per share - diluted $ 0.04 $ (0.07)
============ ==========
Shares used in per share calculation - diluted 4,031 3,515
============ ==========
<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
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<PAGE>
FIBERSTARS, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE OPERATION
(amounts in thousands except per share amounts)
(unaudited)
Three Months Ended March 31,
1999 1998
----------- -----------
Net income (loss) $ 160 $ (261)
Other comprehensive loss, net of tax:
Foreign currency translation adjustments (28) 0
----------- -----------
Comprehensive income (loss) $ 132 $ (261)
=========== ===========
The accompanying notes are an integral part of these financial statements.
Page 5
<PAGE>
<TABLE>
FIBERSTARS INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(amounts in thousands)
(unaudited)
<CAPTION>
Three months ended March 31,
1999 1998
------- -------
<S> <C> <C>
Cash flows from operating activities:
Net income (loss) $ 160 $ (261)
------- -------
Adjustments to reconcile net income (loss) to net
cash provided by
operating activities:
Depreciation and amortization 263 125
Provision for doubtful accounts receivable 19 29
Deferred income taxes (25) (147)
Changes in assets & liabilities:
Accounts receivable, trade (1,294) (1,844)
Notes and other receivable (65) 28
Inventories (91) 30
Prepaid expenses and other current assets. (27) (132)
Other assets 498 (2)
Accounts payable (208) 301
Accrued liabilities (34) 280
------- -------
Total adjustments (964) (1,332)
------- -------
Net cash used in operating activities (804) (1,593)
------- -------
Cash flows from investing activities:
Sale of short-term investments 0 2,008
Cash received against loans made under notes receivable 205 0
Acquisition of fixed assets (239) (110)
------- -------
Net cash provided by (used in) investing activities (34) 1,898
------- -------
Cash flows from financing activities:
Cash proceeds from sale of common stock 0 84
Repayment of long term debt (2) (8)
Addition to long term debt 47 0
------- -------
Net cash provided by financing activities 45 76
------- -------
Effect of exchange rate changes on cash 32 0
------- -------
Net increase (decrease) in cash and cash equivalents (761) 381
Cash and cash equivalents, beginning of period 1,290 523
------- -------
Cash and cash equivalents, end of period $ 529 $ 904
======= =======
<FN>
The accompanying notes are an integral part of these financial statements.
</FN>
</TABLE>
Page 6
<PAGE>
FIBERSTARS, INC.
NOTES TO FINANCIAL STATEMENTS
1. Summary of Significant Accounting Policies
Interim Financial Statements (unaudited)
Although unaudited, the interim financial statements in this report reflect all
adjustments, consisting of normal recurring accruals, which are, in the opinion
of management, necessary for a fair statement of financial position, results of
operations and cash flows for the interim periods covered and of the financial
condition of the Company at the interim balance sheet dates. The results of
operations for the interim periods presented are not necessarily indicative of
the results expected for the entire year.
The year-end balance sheet information was derived from audited financial
statements, but does not include all disclosures required by generally accepted
accounting principles. These financial statements should be read in conjunction
with the Company's audited financial statements and notes thereto for the year
ended December 31, 1998., contained in the Company's 1998 Annual Report to
Shareholders.
Earnings Per Share
The Company presents its earnings per share (EPS) in accordance with SFAS 128
which requires the presentation of basic and diluted EPS. Basic EPS is computed
by dividing income available to shareholders by the weighted average number of
common shares outstanding for the period. Diluted EPS is computed by giving
effect to all dilutive potential common shares that were outstanding during the
period. Dilutive potential common shares consist of incremental shares upon
exercise of stock options and warrants.
In accordance with the disclosure requirements of SFAS 128, a reconciliation of
the numerator and denominator of basic and diluted EPS is provided as follows
(in thousands, except per share amounts):
Three months ended March 31,
----------------------------
1999 1998
------ ------
Numerator - Basic and diluted EPS
Net income (loss) $ 160 $ (261)
Denominator - Basic EPS
Weighted average shares outstanding 3,983 3,515
------ ------
Basic earnings per share $ 0.04 $ (0.07)
====== =======
Denominator - Diluted EPS
Denominator - Basic EPS 3,983 3,515
Effect of dilutive securities:
Stock options and warrants 48 --
------ ------
4,031 3,515
====== ======
Options and warrants to purchase 1,193,140 shares of common stock were
outstanding at March 31, 1999, but were not included in the calculation of
diluted EPS because their inclusion would have been antidilutive. At March 31,
1998, options and warrants to purchase 250,303 were
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<PAGE>
outstanding, but were not included in the calculation of diluted EPS because
their inclusion would have been antidilutive.
2. Inventories
Inventories are stated at the lower of cost (first-in, first-out) or market and
consist of the following (in thousands):
March 31, December 31,
1999 1998
---- ----
(unaudited)
Raw materials $3,099 $2,780
Finished Goods 1,171 1,399
------ ------
$4,270 $4,179
====== ======
3. Comprehensive Income
The Company has adopted the provisions of Statement of Financial Accounting
Standards No. 130, "Reporting Comprehensive Income," effective January 1, 1998.
This statement requires the disclosure of comprehensive income and its
components in a full set of general purpose financial statements. Comprehensive
income is defined as net income plus revenues, expenses, gains and losses that,
under generally accepted accounting principles, are excluded from net income. A
separate statement of comprehensive income has been presented with this report.
4. Significant Equity Transactions
There were no significant equity transactions during the quarter.
5. Recent Pronouncements
In June 1997, the FASB issued Statement of Financial Accounting Standards No.
131, "Disclosures About Segments of an Enterprise and Related Information"
("SFAS 131"), which supersedes SFAS 14, "Financial Reporting for Segments of a
Business Enterprise." SFAS 131 changes current practice under SFAS 14 by
establishing a new framework on which to base segment reporting and also
requires interim reporting of segment information. SFAS 131 is effective for
fiscal years beginning after December disclosures would not be required until
the first quarter immediately subsequent to the fiscal year in which SFAS 131 is
effective. The Company operates in one segment and will not be reporting product
segment information.
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<PAGE>
6. Segments and Geographic Sales
The Company operates in a single industry segment that manufactures, markets and
sells fiber optic lighting products. The Company markets its products for
worldwide distribution primarily through independent sales representatives,
distributors and swimming pool builders in North America, Europe and the Far
East.
A summary of geographic sales is as follows (in thousands):
Three months ended March 31,
----------------------------
1999 1998
---- ----
(unaudited) (unaudited)
U.S. Domestic $4,692 $4,113
Foreign 2,490 546
------ ------
$7,182 $4,659
====== ======
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<PAGE>
FIBERSTARS, INC.
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
The following discussion should be read in conjunction with the attached
financial statements and notes thereto.
RESULTS OF OPERATIONS
Net sales increased 54% to $7,182,000 for the quarter ending March 31, 1999. The
increase was a result of growth in the commercial lighting and pools product
sales. Revenue from companies acquired in 1998 also contributed to revenue
growth in the 1st quarter.
Gross profit increased to $2,976,000 in the 1st quarter of 1999, a 97% increase.
The gross profit margin was 41.4% for the quarter, an increase from the 32.5%
gross margin achieved in the 1st quarter of 1998. The increase in gross margin
was primarily a result of lower lightbox costs in 1999 versus 1998, as well as
lower freight and warranty expenses.
Research and development expenses were $329,000 in the 1st quarter of 1999, a
7.5% increase over 1998. The increase is largely due to additional product
testing expenses in 1999 as compared to the same period in 1998. Research and
development expenses were 5% of sales in in the 1st quarter 1999 versus 7% in
1998. Sales and marketing expenses were $1,858,000 in the 1st quarter of 1999 as
compared to $1,278,000 in 1998, an increase of 45%. The increase was primarily
due to $580,000 in additional expenses for the 1st quarter of 1999 from the
companies acquired in 1998 for which there were no expenses in the 1st quarter
of 1998. Sales and marketing expenses were 26% of sales in the 1st quarter of
1999 compared to 27% in 1998. General and administrative costs were $543,000 in
the 1st quarter 1999, an increase of 35% over 1998 costs. This increase was
largely a result of additional general and administrative costs in the first
quarter of 1999 from companies acquired in 1998 for which there were no expenses
in the 1st quarter of 1998. General and administrative costs were 8% of revenue
in the quarter ending March 31, 1999 versus 9% for the same quarter in 1998.
Total operating expenses were 38% of sales in the 1st quarter of 1999 as
compared to 43% in 1998.
Other income and expense includes interest income and expense. Net interest
income was $4,000 in the 1st quarter of 1999 compared to $63,000 in 1998. The
decrease was due primarily to a use of cash in 1998 to acquire three companies,
along with a general decrease in interest rates since the 1st quarter of 1998.
The income tax rate in the 1st quarter 1999 was 36%, the same rate recorded in
1998. The tax rate is lower than historical rates due to the recognition of
certain tax benefits accumulated over prior years.
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<PAGE>
As a result of the increase in sales in the 1st quarter of 1999 over the same
quarter in 1998 along with the improvement in gross margin, the Company recorded
net income of $160,000 in the 1st quarter of 1999 as compared to a net loss of
$261,000 for the same period in 1998.
LIQUIDITY AND CAPITAL RESOURCES
For the quarter ended March 31, 1999, cash and cash equivalents when combined
with short-term investments were $529,000 as compared to $1,290,000 for the year
ended December 31, 1998. During the quarter, net income contributed $160,000 to
cash, however cash was utilized to increase working capital, primarily due to an
increase in accounts receivable for purchases of "early buy" products on dated
terms to distributors in the pools market, resulting in an overall use of
$804,000 in cash for operating activities. Cash utilized to acquire fixed assets
was partially offset by cash received against loans outstanding for a
divestiture made in fiscal 1998, resulting in a net use of $34,000 in cash for
investing activities. There was a net use of $45,000 in cash for financing
activities, primarily for additions to long term debt for the completion of the
office facility in Germany. As a result of the uses of cash for operating
activies, investing activities and financing activities combined with exchange
rate effects, there was a net use of cash in the 1st quarter of $761,000 which
resulted in an ending cash balance of $529,000. It is expected that as the
"early buy" invoices are collected during the 2nd quarter that cash balances
will increase from this level.
The Company has a $2 million unsecured line of credit for working capital
purposes and a $500,000 term loan commitment to finance equipment purchases.
Both lines expire on June 28, 1999. As of March 31, 1999 the Company had
$249,000 utilized against this facility for the purpose of securing certain
borrowings made by its German subsidiary as part of its building loan.
The Company also had a total borrowing of $720,000 against a credit facility
held by its German subsidiary. This borrowing is largely held in order to
finance the building of new offices owned by the Company in Berching, Germany.
The Company believes that existing cash balances, together with the Company's
bank lines of credit and funds that may be generated from operations, will be
sufficient to finance the Company's currently anticipated working capital
requirements and capital expenditure requirements for at least the next twelve
months.
OTHER FACTORS
This Report on Form 10QSB contains forward-looking statements. Such statements
generally concern future operating results, capital expenditures, product
development and enhancements, liquidity and strategy. Specific forward-looking
statements in this report include, without limitation, statements regarding
improvements in the Company's cash position. We may not update these forward
looking statements, and the occurrence of the events predicted in these
statements is subject to a number of risks and uncertainties, including those
discussed in this report. These risks and uncertainties could cause our actual
results to differ materially from the results predicted in our forward looking
statements. You are encouraged to consider all the information in this report
along with our other periodic reports on file with the SEC, prior to investing
in our stock.
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<PAGE>
BUSINESS RISKS AND UNCERTAINTIES
Our quarterly operating results can vary significantly depending upon a number
of factors. It is difficult to predict the lighting market's acceptance of our
products on a quarterly basis, and the level and timing of orders received can
fluctuate substantially. Our sales volumes also fluctuate. Historically we have
shipped a substantial portion of our quarterly sales in the last month of each
of the second and fourth quarters of the year. Significant portions of our
expenses are relatively fixed in advance based upon our forecasts of future
sales. If sales fall below our expectations in any given quarter, we will not be
able to make any significant adjustment in our operating expenses and our
operating results will be adversely affected. In addition, our product
development and marketing expenditures may vary significantly from quarter to
quarter and are made well in advance of potential resulting revenue.
Sales of our pool and spa lighting products, which currently are available only
with newly constructed pools and spas, depend substantially upon the level of
new construction. Sales of commercial lighting products also depend
significantly upon the level of new building construction and the renovation of
existing buildings. Construction levels are affected by housing market trends,
interest rates, and the weather. Because of the seasonality of construction, our
sales of swimming pool and commercial lighting products, and thus our overall
revenues and income, have tended to be significantly lower in the first quarter
of each year. Various economic and other trends may alter these seasonal trends
from year to year, and we cannot predict the extent to which these seasonal
trends will continue. We believe our business has been favorably impacted by
recent strength in the overall U.S. economy. If the U.S. economy softens, our
operating results will probably suffer.
Competition is increasing in a number of our markets. A number of companies
offer directly competitive products, including fiber optic lighting products for
downlighting, display case and water lighting, and neon and other lighted signs.
Our competitors include some very large and well established companies such as
Philips, Schott, 3M, Bridgestone, Mitsubishi, Osram/Siemens and Rohm &
Haas/Advanced Lighting Technologies. All of these companies have substantially
greater financial, technical and marketing resources than we do. We anticipate
that any future growth in fiber optic lighting will be accompanied by continuing
increases in competition, which could accelerate growth in the market for fiber
optic lighting, but which could also adversely affect our operating results to
the extent we do not compete effectively.
We believe the success of our business depends primarily on our continued
technical innovation, marketing abilities and responsiveness to customer
requirements, rather than on patents, trade secrets, trademarks, copyrights and
other intellectual property rights. Nevertheless, we have a policy of seeking to
protect our intellectual property through, among other things, the prosecution
of patents with respect to certain of our technologies. There are many issued
patents and pending patent applications in the field of fiber optic technology,
and certain of our competitors hold and have applied for patents related to
fiber optic lighting. Although to date we have not been involved in litigation
challenging our intellectual property rights or asserting intellectual property
rights of others, we have in the past received communications from third parties
asserting rights in our patents or that our technology infringes intellectual
property rights held by such third parties. Based on information currently
available to us we do not believe that any such claims involving our technology
or patents are meritorious. However, we may be required to engage in litigation
to protect our patent rights or to defend against the claims of
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others. In the event of litigation to determine the validity of any third party
claims or claims by us against such third party, such litigation, whether or not
determined in our favor, could result in significant expense.
Our business is subject to additional risks that could materially and adversely
affect our future business, including:
o manufacturing risks, including the risks of shortages in materials or
components necessary to our manufacturing and assembly operations, and the
risks of increases in the prices of raw materials and components;
o sales and distribution risks, such as risks of changes in product mix or
distribution channels that result in lower margins;
o risks of the loss of a significant distributor or sales representative;
o risks of the loss of a significant customer or swimming pool builder;
o risks of the effects of volume discounts that we grant from time to time to
our larger customers, including reduced profit margins;
o risks of product returns and exchanges; in this regard, as noted above, we
have increased our warranty reserve in the fourth quarter of 1998 in
response to evidence of defective lamps in certain of our products. We
cannot assure you we will not experience similar component problems in the
future that could also require increased warranty reserves and manufacturing
costs.
o risks associated with product development and introduction problems, such as
increased research, development and marketing expenses associated with new
product introductions; and
o risks associated with delays in the introduction of new products and
technologies, including lost sales and loss of market share.
We have recently completed a series of three acquisitions, including two
acquisitions in Europe, and are now faced with the difficult task of integrating
personnel, marketing and operations of these recently acquired companies. We
have no significant prior experience integrating acquired companies, and we may
face unforeseen difficulties which we are unable to readily address. If we fail
to effectively utilize the new additions to our management and technical teams
resulting from our acquisitions, if our customers or the customers of the
acquired companies do not react favorably to the acquisitions, or if we fail
otherwise to realize the potential benefits of these transactions, our business
and operating results could be adversely affected.
YEAR 2000 COMPLIANCE
Many currently installed computer systems and software products are not capable
of distinguishing 20th century dates from 21st century dates. As a result,
within the next year, computers systems and/or software used by many companies
in a very wide variety of applications will experience operating difficulties
unless they are modified or upgraded to adequately process information
involving, related to or dependent upon the century change. Significant
uncertainty exists in the software and information services industries
concerning the scope and magnitude of problems associated with the century
change. In light of the potentially broad effects of the year 2000 on a wide
range of business systems, the Company's products and services may be affected.
Page 13
<PAGE>
The Company utilizes and is dependent upon data processing computer hardware and
software to conduct its business, and in 1998 completed an upgrade of hardware
and software at an approximate cost of $30,000. The Company has completed its
assessment of its own computer systems and based upon this assessment, the
Company believes its computer systems are "Year 2000 compliant;" that is,
capable of adequately distinguishing 21st century dates from 20th century dates.
However, there can be no assurance that the Company has timely identified or
will timely identify and remediate all significant Year 2000 problems in its own
computer systems, that remedial efforts subsequently made will not involve
significant time and expense, or that such problems will not have a material
adverse effect on the Company's business, operating results and financial
condition. If unforeseen internal disruptions occur, the Company believes that
its existing disaster recovery program, which includes the manual processing of
certain key transactions, would significantly mitigate the impact.
The Company has made efforts to determine the extent of and minimize the risk
that the computer systems of the Company's suppliers or customers are not Year
2000 compliant, or will not become compliant on a timely basis. The Company
expects that the process of making inquiries with these customers and suppliers
will be ongoing through the end of 1999. As of this report, the Company has had
responses from a portion of these customers and suppliers. Of those responding,
the majority are compliant, with the rest indicating they will be compliant by
year end 1999. If Year 2000 problems prevent any of the Company's suppliers from
timely delivery of products or services required by the Company, the Company's
operating results could be materially adversely affected. However, the Company
currently estimates that its costs to address Year 2000 issues relating to its
suppliers will not be material, and that these costs will be funded from its
operating cash flows. The Company has identified and will continue to identify
alternative suppliers in the event its preferred suppliers become incapable of
timely delivering products or services required by the Company. The Company's
suppliers are generally locally or regionally based, which tends to lessen the
Company's exposure from the lack of readiness of any single supplier.
The Company may also face delays in receipt of payments from customers with
unresolved Year 2000 problems, and such delays could materially adversely affect
the Company's operating results. To the extent any such delays are significant
or protracted, the Company's quarterly results would be adversely affected. The
Company intends to continually reassess this risk as it receives communications
about the status of its customers with regard to Year 2000 issues, and if
necessary, adjust its account sales and policies accordingly.
Year 2000 costs relating to the Company's own computer systems including
consulting fees and costs to remediate or replace hardware and software as well
as non-incremental costs resulting from redeployment of internal resources are
estimated to be immaterial . The Company is not able to accurately estimate
potential costs associated with the Year 2000 issues of its customers and
suppliers, and is in the process of verifying that these companies will be year
2000 compliant by the end of 1999. There can be no assurance that the estimated
costs for remediating the Company's own systems as well as estimated costs
associated with the potential non-compliance of its customers and suppliers are
correct, and actual results could differ materially from these estimates.
Specific factors that might cause such material differences include, but are not
limited to, the availability and cost of personnel trained in this area, the
ability to locate and correct all relevant computer costs, and similar
uncertainties.
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<PAGE>
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) The following exhibits have been filed with this Report:
Exhibit 27 - Financial Data Schedule
(b) No reports on Form 8-K were filed by the Company during the period
covered by this report.
Items 1, 2, 3, 4 and 5 are not applicable and have been omitted.
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.
FIBERSTARS, INC.
Date: May 14, 1999
By: /s/ Robert A. Connors
------------------------------
Robert A. Connors
Chief Financial Officer
(Principal Financial and Accounting Officer)
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<PAGE>
INDEX TO EXHIBITS
Exhibit Page
Number Number
------- ------
27 Financial Data Schedule
Page 16
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> MAR-31-1999
<CASH> 529
<SECURITIES> 0
<RECEIVABLES> 6,485
<ALLOWANCES> 19
<INVENTORY> 4,270
<CURRENT-ASSETS> 12,843
<PP&E> 4,257
<DEPRECIATION> 2,690
<TOTAL-ASSETS> 18,859
<CURRENT-LIABILITIES> 4,653
<BONDS> 0
<COMMON> 13,930
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 18,859
<SALES> 7,182
<TOTAL-REVENUES> 7,186
<CGS> 4,206
<TOTAL-COSTS> 4,206
<OTHER-EXPENSES> 2,730
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 250
<INCOME-TAX> 90
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 160
<EPS-PRIMARY> 0.04
<EPS-DILUTED> 0.04
</TABLE>
