<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
(Mark One)
/ X / QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the quarterly period ended ___June 30,1998_______
/ / TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT
For the transition period from _____________ to ____________
Commission file number _______________________________
INTERUNION FINANCIAL CORPORATION
(Exact name of small business issuer as specified in its charter)
<TABLE>
<S> <C>
Delaware 87-0520294
- ----------------------------------------------- ---------------------------------
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
249 Royal Palm Way, Suite 301 H, Palm Beach, Fl 33480
- ----------------------------------------------- ---------------------------------
(Address of principal executive offices) (Zip Code)
(561) 820 - 0084 (561) 655 - 0146
- ----------------------------------------------- ---------------------------------
(Issueris telephone number) (Issueris telecopier number)
</TABLE>
______________________________________________________________________________
(Former name, former address and former fiscal year, if changed since last
report)
Check whether the issuer (1) filed all reports required to be filed by section
13 or 15(d) of the Exchange Act during the past 12 months (or 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 ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Check whether the registrant filed all documents and reports required to be
filed by Section 12, 13 or 15 (d) of the Exchange Act after the distribution of
securities under a plan confirmed by a court. Yes / / No / /
APPLICABLE ONLY TO CORPORATE ISSUERS
State the number of share outstanding of each of the issueris classes of common
equity, as of the latest practicable date: $0.001 Par Value Common Shares -
1,935,945 as of July 31,1998.
Transitional Small Business Disclosure Format (Check One) Yes / / No / X /
Page 1 of 9
<PAGE> 2
PART I - FINANCIAL INFORMATION
ITEM 1 - FINANCIAL STATEMENTS
INTERUNION FINANCIAL CORPORATION
UNAUDITED CONSOLIDATED STATEMENT OF OPERATIONS AND DEFICIT
FOR THE THREE MONTHS ENDED JUNE 30, 1998
<TABLE>
<CAPTION>
3 mos ended 3 mos ended 12 mos ended 12 mos ended
Jun-98 Jun-97 Mar-98 Mar-97
<S> <C> <C> <C> <C>
REVENUES
Investment Banking 274,012 1,390,400 2,642,958 5,346,503
Investment Management 291,444 82,592 370,871 365,680
Interest income 38,888 25,467 101,578 25,665
----------- ----------- ----------- -----------
604,344 1,498,459 3,115,407 5,737,848
----------- ----------- ----------- -----------
EXPENSES
Selling, General & Administration 618,773 1,257,351 3,674,548 5,214,477
Amortization & Depreciation 81,705 58,098 240,886 240,912
Foreign Exchange Loss (Gain) 25,940 (13,032) 17,361 31,067
Interest Expense 71,948 44,941 76,627 2,631
---------- ---------- ---------- ----------
798,366 1,347,358 4,009,422 5,489,087
----------- ----------- ----------- -----------
PROFIT (LOSS) FROM CONTINUING OPERATIONS - BEFORE INCOME TAXES (194,022) 151,101 (894,015) 248,761
EQUITY IN NET EARNINGS (LOSSES OF UNCONSOLIDATED AFFILIATES) 11,582 ---- (8,310) ----
PROVISION FOR INCOME TAXES (RECOVERABLE) (2,548) 53,000 (82,864) 88,085
----------- ----------- ----------- -----------
PROFIT (LOSS) FROM CONTINUING OPERATIONS (179,892) 98,101 (819,461) 160,676
Loss from Discontinued Operation ---- 691 691 (390,829)
Gain on Disposal of Discontinued Assets ---- ---- 803,483 ----
----------- ----------- ----------- -----------
NET PROFIT (LOSS) FOR THE PERIOD (179,892) 98,792 (15,287) (230,153)
FOREIGN EXCHANGE TRANSLATION EFFECT (42,785) 376 4,146 (9,197)
RETAINED EARNINGS (DEFICIT)
- - BEGINNING OF PERIOD (1,578,619) (1,567,478) (1,567,478) (1,328,128)
----------- ----------- ----------- -----------
RETAINED EARNINGS (DEFICIT)
- - END OF PERIOD (1,801,296) (1,468,310) (1,578,619) (1,567,478)
=========== =========== =========== ===========
FINANCIAL OVERVIEW
Common Shares Outstanding 1,673,803 1,255,250 1,654,001 969,714
Weighted Average Shares Outstanding - Basic 1,665,693 1,127,589 1,232,100 899,859
EPS - From Continuing Operations (0.11) 0.09 (0.66) 0.18
EPS - From Discontinuing Operations 0.00 0.00 0.65 (0.43)
EPS (0.11) 0.09 (0.01) (0.25)
Weighted Average Shares Outstanding - Diluted 2,403,411 1,541,106 1,671,568 985,951
EPS - From Continuing Operations (0.11) 0.06 (0.66) 0.16
EPS - From Discontinuing Operations 0.00 0.00 0.48 (0.43)
EPS (0.11) 0.06 (0.01) (0.25)
</TABLE>
See Accompanying Notes to Unaudited Consolidated Financial Statements
Page 2 of 9
<PAGE> 3
INTERUNION FINANCIAL CORPORATION
UNAUDITED CONSOLIDATED BALANCE SHEET
AS AT JUNE 30, 1998
<TABLE>
<CAPTION>
3 mos at 3 mos at 12 mos at 12 mos at
Jun-98 Jun-97 Mar-98 Mar-97
<S> <C> <C> <C> <C>
CURRENT ASSETS
Cash and cash equivalent 635,172 1,141,277 2,873,731 349,738
Due from brokers and dealers 348,890 1,720,919 2,012 166,062
Due from clients 997,031 839,662 715,871 5,967,989
Marketable securities 176,944 627,545 35,169,986 29,457,965
Accounts receivable 962,236 392,486 882,491 226,663
Income tax receivable 6,467 --- 7,789 22,197
Prepaid expenses and other current assets 51,655 39,085 56,733 151,483
Notes receivable 633,646 678,074 616,579 ---
---------- ---------- ---------- ----------
3,812,041 5,439,048 40,325,192 36,342,097
---------- ---------- ---------- ----------
CAPITAL ASSETS 1,371,370 1,559,920 1,425,192 1,609,905
NOTES RECEIVABLE, NON-CURRENT PORTION 790,597 --- 952,106 ---
OTHER LONG-TERM ASSETS 84,710 256,945 84,710 256,945
INVESTMENT IN UNCONSOLIDATED AFFILIATES 3,887,687 1,883,673 3,488,322 ---
GOODWILL, NET 2,084,782 388,855 2,468,210 394,332
DISCONTINUED ASSETS --- 534,399 --- 217,228
---------- ---------- ---------- ----------
8,219,146 4,623,792 8,418,540 2,478,410
---------- ---------- ---------- ----------
12,031,187 10,062,840 48,743,732 38,820,507
========== ========== ========== ==========
CURRENT LIABILITIES
Due to brokers and dealers --- --- 34,663,322 33,012,864
Due to clients 1,248,476 2,334,546 3,057,747 1,320,874
Accounts payable and accrued liabilities 373,205 280,160 1,063,956 257,470
Notes payable 1,988,793 678,074 1,703,441 ---
Bank loan 705,022 --- --- ---
---------- ---------- ---------- ----------
4,315,496 3,292,780 40,488,466 34,591,208
---------- ---------- ---------- ----------
DUE TO RELATED PARTIES 500,000 300,000 --- ---
OTHER LIABILITIES 73,057 --- 77,033 ---
NOTES PAYABLE, LONG-TERM PORTION 624,821 --- 1,485,801 ---
DISCONTINUED LIABILITIES --- 767,804 --- 504,962
DEFERRED INCOME TAX LIABILITY --- 85,000 --- 85,000
---------- ---------- ---------- ----------
1,197,878 1,152,804 1,562,834 589,962
---------- ---------- ---------- ----------
SHAREHOLDERS EQUITY
Capital Stock and additional paid-in capital 8,319,109 7,085,566 8,271,051 5,206,815
Accumulated comprehensive income (47,836) (8,821) (5,051) (9,197)
Retained Earnings (Deficit) (1,753,460) (1,459,489) (1,573,568) (1,558,281)
---------- ---------- ---------- ----------
6,517,813 5,617,256 6,692,432 3,639,337
---------- ---------- ---------- ----------
12,031,187 10,062,840 48,743,732 38,820,507
========== ========== ========== ==========
</TABLE>
See Accompanying Notes to Unaudited Consolidated Financial Statements
Page 3 of 9
<PAGE> 4
INTERUNION FINANCIAL CORPORATION
UNAUDITED CONSOLIDATED STATEMENT OF CHANGES IN FINANCIAL POSITION
FOR THE THREE MONTHS ENDED JUNE 30, 1998
<TABLE>
<CAPTION>
3 mos ended 3 mos ended 12 mos ended 12 mos ended
Jun-98 Jun-97 Mar-98 Mar-97
<S> <C> <C> <C> <C>
OPERATING ACTIVITIES
Net Income (Loss) (179,892) 98,792 (15,287) (230,153)
Amortization 81,705 58,098 240,886 240,912
Non cash compensation --- 60,000 60,000 117,500
Gain on disposition of discontinued operations --- --- (804,174) ---
Deferred income tax --- --- (85,000) 85,000
Unrealized loss (gain) on marketable securities 27,817 25,468 159,831 (529,854)
----------- ----------- ---------- -----------
(70,370) 242,358 (443,744) (316,595)
Increase (decrease) in due to/from brokers and
dealers, net (35,010,200) (34,567,721) 1,814,508 31,515,327
Increase (decrease) in due to/from clients, net (2,090,431) 6,141,999 6,988,991 (5,588,459)
Increase (decrease) in marketable securities 35,063,538 28,754,952 (5,871,852) (26,352,526)
Increase (decrease) in accounts receivable &
sundry assets (73,345) (31,228) (452,610) (184,970)
Decrease (increase) in accounts payable and
accrued liabilities (690,751) 22,690 633,103 (56,560)
Increase in assets and liabilities related to
discontinued operations --- (54,329) (287,734) 129,296
----------- ----------- ---------- -----------
CASH PROVIDED (USED) BY OPERATING ACTIVITIES (2,871,559) 508,721 2,380,662 (854,487)
----------- ----------- ---------- -----------
FINANCING ACTIVITIES
Capital stock and additional paid-in capital issued 133,000 180,000 270,000 727,339
Increase (decrease) in due to related parties 500,000 300,000 ---- (119,462)
Proceeds (repayment) of notes payable (705,022) 678,074 1,508,712 ----
Proceeds (repayment) of bank loan 705,022 --- --- ----
----------- ----------- ---------- -----------
CASH PROVIDED (USED) BY FINANCING ACTIVITIES 633,000 1,158,074 1,778,712 607,877
----------- ----------- ---------- -----------
INVESTING ACTIVITIES
Capital assets --- (12,688) (2,032) (10,866)
Long term investments --- (184,494) (485,336) (66,945)
Notes recevable --- (678,074) (1,299,935) ----
----------- ----------- ---------- -----------
CASH PROVIDED (USED) IN INVESTING ACTIVITIES --- (875,256) (1,787,303) (77,811)
----------- ----------- ---------- -----------
INCREASE (DECREASE) IN CASH (2,238,559) 791,539 2,372,071 (324,421)
CASH - BEGINNING OF YEAR 2,873,731 349,738 349,738 674,159
CASH - ACQUIRED ON ACQUISITION --- --- 151,922 ----
----------- ----------- ---------- -----------
CASH - END OF YEAR 635,172 1,141,277 2,873,731 349,738
=========== =========== ========== ===========
</TABLE>
See Accompanying Notes to Unaudited Consolidated Financial Statements
Page 4 of 9
<PAGE> 5
INTERUNION FINANCIAL CORPORATION
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE THREE MONTHS ENDED JUNE 30, 1998
1. Interim information is unaudited; however, in the opinion of management, all
adjustments necessary for a fair statement of interim results have been
included in accordance with Generally Accepted Accounting Principles. All
adjustments are of a normal recurring nature unless specified in a separate
note included in these Notes to Unaudited Consolidated Financial Statements.
The results for interim periods are not necessarily indicative of results to be
expected for the entire fiscal year. These financial statements and notes
should be read in conjunction with the Company's annual consolidated financial
statements and the notes thereto for the fiscal year ended March 31, 1998,
included in its Form 10-KSB for the year ended March 31,1998.
2. During the first quarter, the Company issued:
o 35,000 shares of common stock and 17,500 common share
purchase warrants for net proceeds of $140,000. A $7,000 fees was
paid to an intermediary;
o 17,002 shares of common stock is exchange for
approximately 1,450,000 Receptagen Ltd. units. Each unit
comprises of one common stock and one common stock purchase
warrant.
In addition, during the quarter the Company cancelled 32,200 shares of
common stock it received in reduction of a note receivable.
Subsequent to the end of the first quarter, the Company issued:
o 231,918 shares of common stock as partial payment for a
C$1,677,864 (US $1,140,000) note due July 1998 and 1999, in
conjunction with its acquisition of Leon Frazer, Black &
Associates Limited and Black Investment Management Limited. The
balance of the note was be paid in cash: C$250,000 (US $170,000)
was paid in July 1998 and C$150,000 (US $105,000) to be paid in
September 1998;
o 27,244 shares of common stock to Leon Frazer, Black &
Associates Limited and $5,494.52 in cash, in order to acquire the
8.55% it did not own in InterUnion Asset Management ("IUAM"),
making IUAM a wholly owned subsidiary;
o 3,000 shares of common stock in exchange for
approximately 260,000 Receptagen Ltd units. Each unit comprises
of one common share and one common share purchase warrant.
3. Earnings per share is computed using the weighted average number of common
shares outstanding during the period. Loss per share is computed using the
weighted average number of common shares outstanding during the period.
4. As of April 1, 1998, the Company adopted Statement of Financial Accounting
Standards No. 130, "Reporting Comprehensive Income". This statement
establishes standards for reporting and display of comprehensive income and its
components. Comprehensive income is net income, plus certain items that are
recorded directly to shareholders' equity, bypassing net income. The only such
item currently applicable to the Company is foreign currency translation
adjustments.
During the quarters ended June 30, 1998 and 1997, total comprehensive
income was ($222,677) and $99,168, respectively. The adoption of this
Statement had no effect on the Company's results of operations or financial
position.
Page 5 of 9
<PAGE> 6
ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS
(1) OVERVIEW
During the first quarter of fiscal 1999 (three months ending June 30,1998),
InterUnion reported consolidated revenues of $0.6 million versus $1.5 million a
year earlier.
Selected financial data from InterUnion's financial statements is (figures in
000's except per share data):
<TABLE>
<CAPTION>
3 mo. ended 3 mo. ended 3 mo. ended
Jun. - 98 Jun. - 97 Jun. - 96
<S> <C> <C> <C>
Revenues 604 1,498 1,458
Net Profit (Loss) (179) 98 58
EPS - Operations (0.11) 0.09 0.08
EPS - Discontinued Operations 0.00 0.00 (0.05)
EPS (0.11) 0.09 0.03
Working Capital (503) 2,146 871
Cash Flow (70) 242 81
Total Assets 12,031 10,063 5,864
Shareholders' Equity 6,518 5,617 3,056
Common Share, # 1,673,803 1,255,250 692,572
Book Value Per Share 3.89 4.48 4.41
</TABLE>
It is the first time, this quarter, that the larger share of the revenue derives
from the investment management activities.
(2) NET REVENUES
During the first quarter of fiscal 1999, InterUnion reported consolidated
revenues of $0.6 million versus $1.5 million a year earlier, for a decrease of
59.7%. Investment banking revenues decreased by 80.3% to $274,012 from
$1,390,400 the previous year. Investment management revenues increased by
252.9% to $291,444 from $82,592 the previous year. The decrease of revenues
in the investment banking can be attributed to a number of factors: (i) general
reduction of financing activities in general as well as trading and financing
activity in the small cap market; (ii) concentration of resources in the merger
and acquisition sector for which the final impact on the profitability can only
be assessed at the finalization of the transaction; and (iii) considerable
utilization of investment banking resources for the administration and
development of the investment management activities, therefore diverting
efforts from other revenue generating activities.
(3) EXPENSES
During the first quarter, the Company reduced its expenses from $1,347,358 to
$798,366 from a year earlier, representing a decrease of 40.7%. This decrease
is attributable to the reduction in Selling, General and Administration
relating to a drop in financing activity, which was reduced by 50.8%, to
$618,773 from $1,257,351. This reduction was offset by increases in Interest
charges due to the notes payable assumed in the acquisition of Leon Frazer,
Black & Associates Limited, Black Investment Management Limited and InterUnion
Asset Management Limited in fiscal 1998.
(4) NET INCOME
Net loss from operations for the three months ending June 30, 1998 was $179,892
or $0.11 per share versus a profit of $98,101 or $0.09 per share a year
earlier. Net loss for the three months ending June 30,1998 is $179,892 or
$0.11 per share versus a profit of $98,792 or $0.09 in 1997. The decrease in
EPS is due to the decrease in revenue, as the Company devote most of its
investment banking resources to finalizing the Receptagen Ltd. restructuring
and the administration and development of the investment activity. In the
first quarter of fiscal 1998, InterUnion recorded a gain from discontinued
operation of $691.
Page 6 of 9
<PAGE> 7
The weighted average number of common shares outstanding for the three months
ending June 30, 1998 is 1,673,803 versus 1,127,589 a year earlier. The
increase is due to the issuance of shares in the form of Regulation "s"
financings and to the acquisition of investment managers.
(5) LIQUIDITY AND CAPITAL RESOURCES
In order to meet its growth plans and fund any operating cash requirements, the
Company's policy is to issue additional capital stock, when possible. To date
the Company has done this either through the issuance of common stock under
Regulation "D" or Regulation "S". The following are details of these private
placements during the previous three fiscal years:
<TABLE>
<S> <C> <C> <C>
Date # of Shares Amount Type
June 1995 62,500 $125,000 Regulation "D"
October 1995 100,000 200,000 Regulation "D" & "S"
March 1996 160,000 320,000 Regulation "D"
September 1996 277,142 759,710 Regulation "S"
June 1998 35,000 140,000 Regulation "S"
</TABLE>
When not able to issue common shares, due to market conditions, the Company will
issue Notes Payable or Preferred Shares. Until the Company acquired its
investment management subsidiaries and initiated the restructuring of Receptagen
Ltd., the Company did not have any long term debt. The debt assumed in the
Receptagen Ltd. restructuring is matched by receivables, with similar terms.
The Company is currently seeking financing through the issuance of convertible
debt and/or common shares in order to reimburse certain loans incurred in
connection with its acquisitions of investment management companies and to
proceed with the acquisition of managed assets.
In July 1998, the Company and the selling shareholders of Leon Frazer, Black &
Associates Limited reached an agreement to settle the Notes due in July 1998
and 1999. The C$1,677,864 (US $1,140,000) note has been settled by the
issuance of common stock and cash: 231,918 shares of common stock, C$250,000
(US $170,000) in cash paid in July 1998 and $150,000 (US $105,000) to be paid
in September 1998,
To meet its cash requirements and honor its payment obligations to the
shareholders of the investee companies, Rif Capital Inc., a shareholder of the
Company, has loaned $500,000 to the Company. In addition, the Company has a
credit facility with a Canadian chartered bank for up to C$2,350,000 (US
$1,600,000) of which C$1,035,000 had been drawn down as of June 30,1998.
Upon completion of a financing, it is the intention of the Company to
rationalize the corporate structure of its investment management affiliates in
order to maximize its shareholders value, in all classes.
(6) ACQUISITION PROGRAM
InterUnion has accelerated the payment of the notes payable to the shareholders
of some of its investee companies as well as the acquisition of the 8.55% of
InterUnion Asset Management Limited it did not own.
The Company continues to actively explore acquisition opportunities in priority
in the investment management sector in order to provide a stable cash flow and
to increase shareholders' equity.
(7) CONCLUDING REMARKS
There are no other known trends, events or uncertainties that may have, or are
reasonably likely to have, a material impact on the Company's short-term or
long-term liquidity that it has not been discussed above.
In addition, there are no significant income or losses that has risen from the
Company's continuing operations that has not been analyzed or discussed above.
In addition, there has not been any material change in any line item that is
presented on the financial statements which has not been discussed above.
Page 7 of 9
<PAGE> 8
(8) CERTAIN RISK FACTORS WHICH MAY IMPACT FUTURE OPERATIONS
The Company and its subsidiaries operate in a rapidly changing environment that
involves a number of factors, some of which are beyond management's control,
such as financial market trends and investors' appetite for new financings.
Forward-looking statements included in Management's Analysis and Discussion
reflects management's best judgment based on known factors and involve risks
and uncertainties. Actual results could differ materially from those
anticipated in these forward-looking statements. Forward-looking information
is provided by InterUnion pursuant to the safe harbor established by recent
securities legislation and should be evaluated in the context of these factors.
In the opinion of management the financial statements for the periods ending
June 30, 1998 accurately reflect the operations of the Company and its
subsidiaries. The Company has taken every reasonable step to ensure itself
that its quarterly financial statements do not represent a distorted picture to
anyone having a business reason to review such statements and who has also
reviewed its previous audited annual financial statements for the year ended
March 31, 1998.
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
The Company is not a party to any pending legal proceeding, nor is its
property the subject of a pending legal proceeding for which the claims,
exclusive of interest and costs, exceed 10% of the current assets of the
Company on a consolidated basis.
ITEM 2 - CHANGES IN SECURITIES
None.
ITEM 3 - DEFAULTS UPON SENIOR SECURITIES
There have been no defaults in the payment of principal or interest with
respect to any senior indebtedness of InterUnion Financial Corporation.
ITEM 4 - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
ITEM 5 - OTHER INFORMATION
None.
ITEM 6 - EXHIBITS AND REPORTS ON FORM 8-K
Exhibit 27 Financial Data Schedule (for S.E.C. use only).
Page 8 of 9
<PAGE> 9
SIGNATURES
In accordance with the requirements of the Exchange Act, the registrant
caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.
InterUnion Financial Corporation
----------------------------------------
(Registrant)
Date August 13,1998 /s/ Georges Benarroch, Director
- ------------------------- ----------------------------------------
(Signature)*
Date August 13,1998 /s/ Selwyn J. Kletz, Director
- ------------------------- ----------------------------------------
(Signature)*
* Print the name and title of each signing officer under his signature.
Page 9 of 9
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
(A) INTERUNION FINANCIAL CORPORATION CONSOLIDATED FINANCIAL STATEMENTS
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
(B) 10 QSB FILING
</LEGEND>
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-31-1999
<PERIOD-START> APR-1-1998
<PERIOD-END> JUN-30-1998
<EXCHANGE-RATE> 1
<CASH> 635,172
<SECURITIES> 176,944
<RECEIVABLES> 962,236
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,812,041
<PP&E> 2,123,423
<DEPRECIATION> (752,053)
<TOTAL-ASSETS> 12,031,187
<CURRENT-LIABILITIES> 4,315,496
<BONDS> 0
<COMMON> 1,674
0
150,000
<OTHER-SE> 8,167,435
<TOTAL-LIABILITY-AND-EQUITY> 12,031,187
<SALES> 0
<TOTAL-REVENUES> 604,344
<CGS> 0
<TOTAL-COSTS> 618,773
<OTHER-EXPENSES> 107,645
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 71,948
<INCOME-PRETAX> (194,022)
<INCOME-TAX> (2,548)
<INCOME-CONTINUING> (179,892)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (179,892)
<EPS-PRIMARY> (0.11)
<EPS-DILUTED> (0.11)
</TABLE>
