<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
----------------------
FORM 10-Q
(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, 1997
--------------
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 0-24544
CYBERGUARD CORPORATION
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(Exact name of Registrant as Specified in Its Charter)
Florida 65-510339
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(State or Other Jurisdiction (I.R.S. Employer
of Incorporation or Organization) Identification No.)
2101 West Cypress Creek Road, Fort Lauderdale, Florida 33309
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(Address of Principle Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code 954-973-5478
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Former Name, Former Address and Former Fiscal Year, if Changed Since Last Report
Indicate by check x whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports),
Yes X No
----- -----
and (2) has been subject to such filing requirements for the past 90 days.
Yes X No
----- -----
The number of shares of each of the Registrant's classes of common
stock, outstanding as of May 12, 1997 were 7,385,930
<PAGE> 2
PART I FINANCIAL INFORMATION
Item 1. Financial Statements
CYBERGUARD CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
(Dollars in thousands except per share data)
Three Months Ended Nine Months Ended
----------------------------- ------------------------------
March 31, March 30, March 31, March 30,
1997 1996 1997 1996
--------- --------- -------- ---------
<S> <C> <C> <C> <C>
Sales
Equipment $ 3,874 $ 2,432 $ 9,585 $ 5,007
Services 231 138 634 285
Real time products 0 10,544 0 28,979
----------- ----------- ----------- -----------
Total sales 4,105 13,114 10,219 34,271
Cost of sales
Equipment 1,727 1,739 4,924 3,458
Services 143 56 328 124
Real time products 0 5,123 0 14,903
----------- ----------- ----------- -----------
Total cost of sales 1,870 6,918 5,252 18,485
Gross income 2,235 6,196 4,967 15,786
Operating expenses
Research and development 1,028 271 3,095 828
Selling, general and administrative 2,847 1,728 7,743 4,615
Transaction expense 0 820 0 820
Real time operating expenses 0 5,258 0 18,581
----------- ----------- ----------- -----------
Total operating expenses 3,875 8,077 10,838 24,844
----------- ----------- ----------- -----------
Operating loss (1,640) (1,881) (5,871) (9,058)
Other income (expense)
Interest income 187 68 550 250
Gain(Loss) on sale of equity securities 800 0 (4,414) 0
Other income (expense) (239) 3 (236) 230
----------- ----------- ----------- -----------
Total other income (expense) 748 71 (4,100) 480
----------- ----------- ----------- -----------
Net Loss $ (892) $ (1,810) $ (9,971) $ (8,578)
=========== =========== =========== ===========
Loss per common and common equivalent share $ (0.12) $ (0.31) $ (1.40) $ (1.45)
=========== =========== =========== ===========
Weighted average number of common and common
equivalent shares outstanding 7,375,293 5,929,000 7,105,576 5,920,219
=========== =========== =========== ===========
</TABLE>
See accompanying notes to condensed consolidated financial statements
2
<PAGE> 3
CYBERGUARD CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEET
(Unaudited)
<TABLE>
<CAPTION>
(Dollars in thousands)
March 31, June 30,
1997 1996
--------- --------
<S> <C> <C>
Cash and cash equivalents $ 6,434 $ 3,617
Securities available for sale 1,320 13,600
Accounts and notes receivable, less allowance for
uncollectible accounts of $ 484 at March 31, 1997
and $ 318 at June 30, 1996 4,856 3,668
Inventories 1,444 134
Prepaid expenses 677 565
-------- --------
Total current assets 14,731 21,584
Machinery and equipment at cost, less accumulated
depreciation of $ 1,624 at March 31, 1997 and
$1,035 at June 30, 1996 1,570 1,152
Non-Compete Agreement 910 1,120
Investment in Concurrent Preferred Stock-long term 0 3,853
Other assets 203 3
-------- --------
Total assets $ 17,414 $ 27,712
======== ========
Accounts payable $ 1,473 $ 0
Deferred revenue 903 44
Accrued expenses 3,175 6,223
Loan payable 0 3,200
-------- --------
Total current liabilities 5,551 9,467
-------- --------
Total liabilities 5,551 9,467
Shareholders' equity
Common stock par value $0.01 authorized 20,000,000 shares
issued and outstanding 7,381,815 at March 31, 1997
and 6,709,371 at June 30, 1996 74 67
Additional paid in capital 59,148 56,152
Accumulated deficit (47,181) (37,210)
Unrealized gain on securities held for resale 263
Cumulative translation adjustment (441) (764)
-------- --------
Total shareholders' equity 11,863 18,245
-------- --------
Total liabilities and shareholders' equity $ 17,414 $ 27,712
======== ========
</TABLE>
See accompanying notes to condensed consolidated financial statements
3
<PAGE> 4
CYBERGUARD CORPORATION
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW
(Unaudited)
<TABLE>
<CAPTION>
(Dollars in thousands)
Nine Months Ended
--------------------------
March 31, March 30,
1997 1996
--------- ---------
<S> <C> <C>
Cash flows from operating activities
Net loss $ (9,971) $ (8,578)
Adjustment to reconcile net loss to net cash
provided from (used in) operating activities:
Depreciation 289 2,064
Amortization 210 1,392
Appreciation of securities held for resale (647)
Loss on sale of Concurrent Computer stock 4,419
Amortization of Cumulative translation adjustment 220
Deferred incometaxes (859)
Changes in assets and liabilities
Receivables (1,188) (3,296)
Prepaid Expenses (112) 827
Inventories (1,310) 3,515
Trade payables 1,473 789
Other expenses and accruals (1,649) 651
Deferred revenue 860 (740)
Other 198 97
-------- --------
Net cash used in operating activities (7,208) (4,138)
-------- --------
Cash flows from investing activities
Additions to machinery and equipment (707) (1,350)
Unrealized gain in preferred stock 263
Software development costs & other assets (200) (3,327)
-------- --------
Net cash used in investing activities (644) (4,677)
-------- --------
Cash flows from financing activities
Proceeds from sale of Concurrent Computer Stock 12,363 0
Payoff of short term loan (3,200) 0
Equity contributions 1,506 161
-------- --------
Net cash provided from financing activities 10,669 161
-------- --------
Net increase (decrease) in cash 2,817 (8,654)
Cash and cash equivalents at beginning of period 3,617 9,961
-------- --------
Cash and cash equivalents at end of period $ 6,434 $ 1,307
======== ========
</TABLE>
See accompanying notes to condensed consolidated financial statements
4
<PAGE> 5
CYBERGUARD CORPORATION
Notes to Condensed Consolidated Financial Statements
March 31, 1997
(Unaudited)
1. BASIS OF PRESENTATION
The accompanying unaudited consolidated financial statements have been
prepared in accordance with the instructions to Form 10-Q and, therefore,
do not include all information and footnotes necessary for a fair
presentation of financial position, results of operations, and cash flows
in conformity with generally accepted accounting principles. The
information furnished, in the opinion of management, reflects all
adjustments, which consist of normal recurring adjustments, necessary to
present fairly the results of operations of the Company for the three
month periods ended March 31, 1997 and March 30, 1996 and the financial
position of the Company as of March 31, 1997 and June 30, 1996.
While the Company believes that the disclosures presented are adequate to
make the information not misleading, it is suggested that these
consolidated financial statements be read in conjunction with the audited
consolidated financial statements and the notes included in the Form 10-K
for the fiscal period ended June 30, 1996 as filed with the Securities and
Exchange Commission.
The results of operations of interim periods are not necessarily
indicative of results which may be expected for any other interim period
or for the year as a whole.
Effective June 30, 1996, the Company sold the net assets of its real-time
computing business with a book value of $21.6 million and issued 683,178
shares of its common stock valued at $11.8 million to Concurrent in
exchange for (i) 10 million newly issued shares of Concurrent common
stock, par value $0.01 per share valued at $17 million and (ii)
convertible exchangeable preferred stock of Concurrent Computer
Corporation (Concurrent) paying a 9% cumulative annual dividend quarterly
in arrears with a liquidation preference of approximately $6.3 million.
2. EARNINGS PER SHARE
Net loss per share for the periods presented have been computed using the
weighted average number of common shares outstanding Common equivalent
shares (stock options) outstanding during the period have been excluded
due to their anti-diluting effect.
3. INVENTORIES
Inventories are valued at the lower of cost or market, with cost being
determined by using the first-in, first-out ("FIFO") method.
4. LINE OF CREDIT
As of March 31, 1997 the Company had no debt or bank borrowings, and all
assets of the Company were free from pledges or collateral requirements.
On April 1, 1996, the Company entered into a line of credit of up to $5.0
million with Foothill Capital Corporation. The line of credit allowed for
the borrowing of up to 80% of eligible domestic accounts receivable. The
line was backed by all the domestic assets of the Company. The line of
credit outstanding of $3.2 million was paid in its entirety in August 1996
and the line of credit was terminated.
5
<PAGE> 6
CYBERGUARD CORPORATION
Notes to Condensed Consolidated Financial Statements
March 31, 1997
(Unaudited)
5. REVENUE RECOGNITION
Revenue is recognized from sales when a product is shipped, from rentals
as they accrue, and from services and maintenance when performed. Unearned
income on service contracts is amortized by the straight-line method over
the term of the contracts. Revenue from long-term software contracts is
accounted for by the percentage of completion method whereby income is
recognized based on the estimated stage of completion of individual
contracts using costs incurred as a percentage of total estimated costs at
completion. Losses on long-term contracts are recognized in the period in
which such losses are determined.
6. FOREIGN CURRENCY TRANSLATION
The assets and liabilities of the foreign operations are translated using
the local currency as the functional currency.
7. SUBSEQUENT EVENTS
On March 26, 1997 the Company created a wholly owned subsidiary, Tradewave
Corporation, a Florida corporation (Tradewave-Florida). On April 9, 1997
Tradewave-Florida acquired substantially all the assets of TradeWave
Corporation, a Delaware corporation (Tradewave-Delaware) specializing in
electronic commerce software applications, for approximately $350,000 plus
the assumption of certain lease obligations and accrued expenses. In
addition, the Company agreed to pay a 3% royalty on revenues from an
existing long term program, called OASIS, to the Tradewave-Delaware
company for a period of two (2) years. In conjunction with the purchase of
the assets of Tradewave-Delaware, the Company hired twenty-four (24)
former employees of Tradewave-Delaware Company. Operations commenced for
Tradewave-Florida on April 10, 1997. The Company intends to account for
the transaction as a purchase in accordance with APB 16. The Fair Market
Value of the assets acquired is in the process of being calculated as of
the date of this report.
6
<PAGE> 7
CYBERGUARD CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
The quarter ended March 31, 1997 compared to the quarter ended March 30, 1996
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NET SALES
Net revenues consist primarily of network security product sales including
sales of third-party security products, support services, and for the
period ending March 30, 1996 only, the sale of real-time computer products
from the Company's former real-time division which was sold to Concurrent
Computer Corporation ("Concurrent") in June 1996. For the quarter ended
March 31, 1997, net sales declined by $9.0 million when compared to the
quarter ended March 30, 1996. The $9.0 million decline comprises an
increase of $1.5 million in network security product and service sales for
the current quarter which partially offsets the $10.5 million in real-time
products included in the prior year's quarterly results. The $1.5 million
or 60% increase in network security product sales is the result of
increased shipments of the Company's CyberGuard firewall systems as
firewall technology, in general, continues to gain wider acceptance in the
commercial marketplace as a viable solution for Internet and intranet
security. Specifically, the Company shipped 172 CyberGuard systems during
the quarter ended March 31, 1997 compared to 63 for the quarter ending
March 30, 1996. Of the 172 CyberGuard systems shipped during the current
quarter, 124 or 72% were CyberGuard Version 3.0 Firewall systems. The
CyberGuard Version 3.0 system was introduced in September 1996 and began
shipping in production quantities in October 1996. The CyberGuard Version
3.0 systems are designed to run on industry standard Intel(TM) Pentium
and Pentium Pro based products from suppliers such as IBM, Unisys, Compaq,
Hewlett-Packard, Data General, and ALR. The Company also believes it
experienced a strong increase in sales leads during the three months ended
March 31, 1997 based upon, primarily, numerous major awards received from
industry leading trade magazines and publications during the
February-March 1997 period. Additionally, sales provided through the
CyberGuard world wide resellers program increased based upon renewed
marketing and advertising programs targeted toward these resellers.
For the quarter ending March 31, 1997, international sales of the
Company's network security products increased to $2.6 million compared to
$0.9 million for the quarter ended March 30, 1996. The increase in
international sales for network security products is the result of
continued market penetration in Japan and Korea, as well as increased
Firewall unit shipments in Europe, especially the United Kingdom. The
Company believes that increased demand for CyberGuard Firewall products in
the United Kingdom is attributed to customer awareness of the U.K.
government certification for the CyberGuard Firewall application program
suite; specifically, the Company's CyberGuard V.2 was awarded the United
Kingdom government's ITSEC E-3 rating in February, 1997. International
sales represent 64% and 36% of total security product sales for the
periods ending March 31, 1997 and March 30, 1996 respectively.
Domestic product sales for firewall products decreased by $0.26 million
to $1.23 million in the quarter ended March 31, 1997. This decline is
primarily due to U.S. government Department of Defense revenues for the
current quarter when compared to the three months ended March 29, 1996.
For the previous year's quarter, the Company recognized sales of secure
servers and/or gate guard products from several Department of Defense
programs. There were no equivalent sales during the current quarter.
7
<PAGE> 8
CYBERGUARD CORPORATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
Revenues from support services related to Firewall products increased from
$138,000 for the three months ended March 30, 1996 to $231,000 for the
three months ended March 31, 1997. This increase is due to a greater
number of installed units and increased customer training in connection
with increased sales. Support services for firewall products accounted for
5.6% of sales during the quarter ended March 31, 1997.
GROSS PROFIT
Gross Profit as a percent of sales increased from 47.2% to 54.5% for the
quarter ended March 31, 1997. The increase is a result of product mix. The
Real-time related products and services accounted for $5.4 million or
87.5% of prior year's Gross Profit. Disregarding the gross profit from
Real-time sales, the gross margin for network security products improved
significantly from 31% for the three months ended March 30, 1996 to 54%
for the current quarter. The margin improvement is due to increased sales
of the Company's version 3.0 Intel based Firewall product as compared to
the previous version 2.0 product which ran on the Company's proprietary
NightHawk hardware platform. The version 3.0 product maintains
significantly higher gross margins than the previously available version
2.0.
OPERATING EXPENSES AND NET LOSS
Overall operating expense declined by $4.2 million in the current quarter
to $3.87 million. This decrease is due to the inclusion of the Real-time
division operating expenses incurred in the March 30, 1996 results. For
the quarter ending March 30, 1996, Real-time operating expenses accounted
for $5.3 million. Comparing only the operating expenses for the network
security products, the Company operating expenses increased $1.9 million
from expenses in the three month period ended March 30, 1996 to $3.87
million for the period ended March 31, 1997. This increase of 93% has
continued to be primarily due to:
- Increased marketing efforts and promotional expenditures.
- Increased development efforts related to the CyberGuard Firewall for
Windows NT Operating System and the next generation UNIX-based
CyberGuard Firewall solution.
- Increased costs and hirings associated with running the network
security division as a stand-alone entity following the sale of the
Real-time division to Concurrent in June 1996.
- Increased costs and hirings associated with customer support,
presales and post-sales activities.
The net loss for the quarter ended March 31, 1997 was $0.9 million
compared to $1.8 million in the prior year's quarter. For the current
quarter, the Company recognized a gain of approximately $0.8 million
through the sale of 1 million shares of Concurrent Common Stock (obtained
by the Company through the conversion of a portion of Concurrent Preferred
Stock holdings into Concurrent Common Stock). In addition, the Company
wrote off $0.2 million of the cumulative foreign currency translation
adjustment in the current quarter which was attributable to the Company's
former foreign subsidiaries sold to Concurrent in June 1996.
8
<PAGE> 9
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
The nine month period ended March 31, 1997 compared to the nine month period
- ----------------------------------------------------------------------------
ended March 30, 1996
- --------------------
NET SALES
Net sales were lower in the nine month period ended March 31, 1997
compared to the nine month period ended March 30, 1996 primarily as a
result of discontinued Real Time product revenues resulting from the sale
of the Real Time product division which was sold to Concurrent in June
1996. Overall net sales were $10.2 million for the nine months ended March
31, 1997, compared to $34.3 million for the nine months ended March 30,
1996. The prior year's nine month period included $29.0 million of Real
Time product revenues. The remaining $5.3 million in revenues for the nine
month period ended March 30, 1996 relate to sales of the Company's
CyberGuard Firewall and related security products. This $5.3 million in
revenues compares to $10.2 million in CyberGuard Firewall sales for the
nine months ending March 31, 1997. The increase of $4.9 million or 84% is
attributable to expanded sales efforts and an overall rise in market
demand for network security products.
For the respective nine month periods, international Firewall and security
product revenues accounted for 60% of sales in 1997 and 46% of sales in
1996. Firewall related service revenues increase by 123% to $0.6 million
for the nine month period ended March 31, 1997 compared to $0.28 million
for the nine month period ended March 30, 1996. This increase is due to an
increased number of installed units.
GROSS PROFIT
As a percentage of net sales, the gross profit increased for the nine
month period ended March 31, 1997 to 48.6% as compared to 46.1% for the
nine month period ended March 30, 1996. The gross profit for Real Time
product sales included in the nine months ended March 30, 1996 results was
$14 million or 94% of the gross profit margin. Gross profit for Firewall
and security products, considered separately from Real Time products, for
the nine months ended March 30, 1996 was $1.7 million or 6% of the total
gross profit. In comparing the gross profit for network security products
in 1996 to the gross profit for the nine months ended March 31, 1997, the
gross profit increased from 32% to 54% and can be directly attributed to
CyberGuard Firewall version 3.0 systems which began shipping in October
1996. CyberGuard Firewall version 3.0 systems provides higher gross profit
than earlier versions of CyberGuard Firewalls shipped during the nine
month period ended March 30, 1996.
OPERATING EXPENSES AND NET LOSS
Expenses decreased for the nine months ended March 31, 1997 by $14.0
million to $10.8 million from $24.8 million for the nine month period
ended March 30, 1996. This $14.0 million decrease is due primarily to the
elimination of operating expenses to support the Real Time products
division. Expenses related to the development, marketing and support of
the CyberGuard Firewall and related security products increased for the
nine month ended March 31, 1997 to $10.8 million compared to $5.4 million
for the nine months ended March 30, 1996. This increase relates to
additional staffing to support the development of the CyberGuard version
3.0 and CyberGuard Windows NT version Firewalls, the SAFENET Enterprise
VPN Products, and additional expenditures to promote and market these
products and additional costs incurred to operate the secure division as a
stand alone entity.
9
<PAGE> 10
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
For the nine months ended March 31, 1997, the Company recognized a
$4.4 million loss on the sale of Concurrent Corporation securities
received from the sale of the Real Time product division to
Concurrent. There were no corresponding transactions for the nine
month period ended March 30, 1996.
LIQUIDITY AND CAPITAL RESOURCES
At March 31, 1997, the Company had cash and cash equivalents on hand
of $6.4 million representing an increase of $2.8 million from $3.62
million as of June 30, 1996. Additionally, marketable securities on
hand were $1.3 million as compared to $13.6 million at June 30, 1996.
The decline is due to the sale of Concurrent Computer Corporation
common stock that the Company received on June 26, 1996 for the sale
of its Real Time division. Accounts receivable increased by
approximately $1.2 million since June 30, 1996 as a result of
increased sales efforts on a world-wide basis and extended payment
terms provided to the new resellers. Inventory increased by $1.3
million as the Company established base-level inventory stocking
levels to support short lead time customer shipments for both the
Motorola based CyberGuard Systems purchased from Concurrent Computer
Corporation and Intel-based systems purchased to support CyberGuard
version 3.0 orders. Approximately $0.3 million inventory represents
the large number of in use/in process customer evaluations on hand at
March 31, 1997. Machinery and equipment additions amounted to $0.7
million for the nine months ended March 31, 1997. These additions were
used for development and demonstration equipment related to the
Company's Intel-based 3.0 product line. The ability to meet the
Company's obligations while continuing to invest in the development of
intellectual property and the marketing and promotion of the Company's
security products will depend upon, among other things, the ability of
the Company to derive sources of liquidity from non cash assets such
as accounts receivable and inventory, and/or the Company's ability to
obtain additional debt or equity funding. Currently, the Company is in
discussions with several entities regarding alternative debt or equity
financing. There can be no assurance however that such additional
financing will be available to the Company on acceptable or
competitive terms.
Statements regarding future liquidity and capital resources, as well
as other statements contained in this report that address activities,
events or developments that the Company expects, believes or
anticipates will or may occur in the future, are forward-looking
statements. These statements are based upon certain assumptions and
analyses made by the Company in light of current conditions, future
developments and other factors the Company believes are appropriate in
the circumstances. Such statements are subject to a number of
assumptions, risks and uncertainties. Readers are cautioned that
forward-looking statements are not guarantees of future performance
and that actual results may differ materially from those projected in
the forward-looking statements. The future liquidity of the Company
will be affected by numerous factors, including sales volumes,
collections of accounts receivable, gross margins, the levels of
selling, general and administrative expenses required to fully
implement Firewall security systems product sales to commercial
customers, levels of required capital expenditures, and access to
external sources of financing.
10
<PAGE> 11
PART II. OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS OF FORM 8-K
(a) Exhibits:
27 Financial Data Schedule
(b) On April 23, 1997 the Company filed a current report on Form 8-K
dated April 9, 1997 and reported on Item 2 thereof the
acquisition by the Company of substantially all the assets of
TradeWave Corporation, a Delaware corporation.
11
<PAGE> 12
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, 1997 CYBERGUARD CORPORATION
By: /s/ ROBERT L. CARBERRY
-----------------------------------
ROBERT L. CARBERRY
Chairman, President and Chief
Executive Officer
By: /s/ PATRICK O. WHEELER
-----------------------------------
PATRICK O. WHEELER
Vice President of Finance and Chief
Financial Officer (Principal Financial
and Accounting Officer)
12
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S CONSOLIDATED BALANCE SHEET AT MARCH 31, 1997 AND CONSOLIDATED
STATEMENTS OF OPERATIONS FOR THE THREE MONTHS ENDED MARCH 31, 1997, AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> JUN-30-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<CASH> 6,434
<SECURITIES> 1,320
<RECEIVABLES> 4,856
<ALLOWANCES> 484
<INVENTORY> 1,444
<CURRENT-ASSETS> 14,731
<PP&E> 3,194
<DEPRECIATION> 1,624
<TOTAL-ASSETS> 17,414
<CURRENT-LIABILITIES> 5,551
<BONDS> 0
0
0
<COMMON> 74
<OTHER-SE> 11,778
<TOTAL-LIABILITY-AND-EQUITY> 17,414
<SALES> 3,874
<TOTAL-REVENUES> 4,105
<CGS> 1,727
<TOTAL-COSTS> 1,870
<OTHER-EXPENSES> 3,875
<LOSS-PROVISION> 160
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (892)
<INCOME-TAX> 0
<INCOME-CONTINUING> (892)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (892)
<EPS-PRIMARY> (0.12)
<EPS-DILUTED> (0.12)
</TABLE>
