SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1997
Commission File No. 0-24946
KNIGHT TRANSPORTATION, INC.
(Exact name of registrant as specified in its charter)
Arizona 86-0649974
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5601 West Buckeye Road
Phoenix, Arizona
85043
(Address of Principal Executive Offices)
(Zip Code)
Registrant's telephone number, including area code: 602-269-2000
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
--------------- ------------
The number of shares outstanding of registrant's Common Stock, par value $0.01
per share, as of August 12, 1997 was 9,919,500 shares.
<PAGE>
KNIGHT TRANSPORTATION, INC.
INDEX
PART I - FINANCIAL INFORMATION Page Number
Item 1. Financial Statements
Consolidated Balance Sheets as of June 30, 1997 (unaudited) 1
and December 31, 1996
Consolidated Statements of Income (unaudited) for the Three 3
Months and Six Months Ended June 30, 1997 and June 30, 1996
Consolidated Statements of Cash Flows (unaudited) for the Six 4
Months Ended June 30, 1997 and June 30, 1996
Notes to Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis of Financial Condition 6
and Results of Operations
Part II - OTHER INFORMATION
Item 1. Legal Proceedings 9
Item 2. Changes in Securities 10
Item 3 Defaults Upon Senior Securities 10
Item 4. Submission of Matters to a Vote of Security Holders 10
Item 5. Other Information 10
Item 6 Exhibits and Reports on Form 8-K 10
Signatures 11
Index to Exhibits 13
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
KNIGHT TRANSPORTATION, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
as of June 30, 1997 (unaudited) and December 31, 1996
<TABLE>
<CAPTION>
June 30, 1997
( unaudited ) December 31, 1996
---------------------- --------------------
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and cash equivalents $ 26,571 $ 1,244,745
Accounts receivable, net 11,033,306 10,414,133
Inventories and supplies 439,927 328,825
Prepaid expenses 1,489,696 509,085
Deferred tax asset 1,419,600 1,319,400
---------------------- --------------------
Total current assets 14,409,100 13,816,188
---------------------- --------------------
PROPERTY AND EQUIPMENT:
Land and improvements 4,297,837 4,297,837
Buildings and improvements 970,963 970,963
Furniture and fixtures 1,911,446 1,837,844
Shop and service equipment 941,931 859,592
Revenue equipment 63,722,710 55,172,272
Leasehold improvements 665,889 575,015
---------------------- --------------------
72,510,776 63,713,523
Less: Accumulated depreciation (15,639,159) (14,186,781)
---------------------- --------------------
PROPERTY AND EQUIPMENT, net 56,871,617 49,526,742
OTHER ASSETS 981,507 775,526
---------------------- --------------------
$72,262,224 $64,118,456
====================== ====================
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
1
<PAGE>
KNIGHT TRANSPORTATION, INC. AND SUBSIDIARIES
Consolidated Balance Sheets (continued)
as of June 30, 1997 (unaudited) and December 31, 1996
<TABLE>
<CAPTION>
June 30, 1997
(unaudited) December 31, 1996
------------- -----------------
<S> <C> <C>
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 5,509,008 $ 3,954,286
Accrued liabilities 2,448,860 2,286,099
Claims accrual 3,059,057 3,040,672
Current portion of long-term debt 115,212 394,191
----------- -----------
Total current liabilities 11,132,137 9,675,248
LONG TERM DEBT, less current portion -- 53,491
DEFERRED INCOME TAXES 10,300,300 8,426,558
----------- -----------
Total liabilities 21,432,437 18,155,297
----------- -----------
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY:
Preferred stock, $0.01 par value;
authorized 50,000,000 shares,
none issued and outstanding -- --
Common Stock, $0.01 par value;
authorized 100,000,000 shares; issued
and outstanding 9,919,500 and 9,904,500
shares respectively 99,195 99,045
Additional paid-in capital 23,671,256 23,474,531
Retained earnings 27,059,336 22,389,583
----------- -----------
Total shareholders' equity 50,829,787 45,963,159
----------- -----------
$72,262,224 $64,118,456
=========== ===========
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
2
<PAGE>
KNIGHT TRANSPORTATION, INC. AND SUBSIDIARIES
Consolidated Statements of Income
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30
---------------------------- ----------------------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
OPERATING REVENUE $ 24,240,668 $ 18,969,783 $ 45,563,216 $ 35,550,619
OPERATING EXPENSES:
Salaries, wages and benefits 6,619,781 5,359,717 12,664,877 10,089,610
Fuel 2,506,653 2,030,943 4,682,224 3,751,140
Operations and maintenance 1,200,198 915,778 2,436,317 1,748,352
Insurance and claims 711,937 792,120 1,198,681 1,410,081
Operating taxes and licenses 980,668 716,939 1,878,313 1,358,907
Communications 125,821 111,277 256,595 234,780
Depreciation and amortization 2,267,287 1,829,014 4,392,883 3,417,124
Purchased transportation 4,852,343 3,474,231 9,025,283 6,537,113
Miscellaneous operating expenses 579,375 484,606 1,101,960 913,106
------------ ------------ ---------- -------------
19,844,063 15,714,625 37,637,133 29,460,213
------------ ------------ ------------ -------------
Income from operations 4,396,605 3,255,158 7,926,083 6,090,406
OTHER INCOME (EXPENSE):
Interest income 8,651 1,740 45,179 3,675
Interest expense (7,506) (171,997) (21,507) (271,381)
------------ ------------ ------------ ------------
1,145 (170,257) 23,672 (267,706)
------------ ------------ ------------ ------------
Income before taxes 4,397,750 3,084,901 7,949,755 5,822,700
INCOME TAXES (1,820,000) (1,284,000) (3,280,000) (2,434,000)
------------ ------------ ------------ ------------
Net Income $ 2,577,750 $ 1,800,901 $ 4,669,755 $ 3,388,700
============ ============ ============ ============
Net income per common share and common share
equivalent: Primary $ 0.26 $ 0.20 $ 0.46 $ 0.37
============ ============ ============ ============
Fully diluted $ 0.26 $ 0.19 $ 0.46 $ 0.37
============ ============ ============ ============
Weighted average number of common
common shares equivalents outstanding:
Primary 10,082,665 9,217,560 10,078,680 9,190,934
============ ============ ============ ============
Fully diluted 10,103,690 9,242,283 10,105,206 9,241,378
============ ============ ============ ============
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
3
<PAGE>
KNIGHT TRANSPORTATION, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows
(unaudited)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
-----------------------------
1997 1996
---- ----
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 4,669,755 $ 3,388,700
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 4,392,883 3,567,124
Allowance for doubtful accounts 66,093 73,139
Deferred income taxes 1,773,542 581,760
Changes in assets and liabilities:
Increase in receivables (685,266) (2,556,297)
Increase in inventories and supplies (111,102) (84,365)
(Increase) decrease in prepaid expenses (980,611) 628,259
Increase in other assets (223,162) (361,248)
Increase in accounts payable 1,623,288 883,033
Increase in accrued liabilities and
claims accrual 181,146 978,817
------------ ------------
Net cash provided by operating
activities 10,706,566 7,098,922
------------ ------------
CASH FLOW FROM INVESTING ACTIVITIES:
Purchase of property and equipment, net (8,859,345) (14,142,954)
------------ ------------
Net cash used in investing activities $ (8,859,345) $(14,142,954)
------------ ------------
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
4
<PAGE>
KNIGHT TRANSPORTATION, INC. AND SUBSIDIARIES
Consolidated Statements of Cash Flows (continued)
(unaudited)
<TABLE>
<CAPTION>
Six Months Ended
June 30,
---------------------------
1997 1996
---- ----
<S> <C> <C>
CASH FLOW FROM FINANCING ACTIVITIES:
Borrowing of debt -- 8,855,391
Payments of debt (332,470) (431,151)
Decrease in accounts payable - equipment (2,929,800) (1,927,726)
Proceeds from exercise of stock options 196,875 --
----------- -----------
Net cash provided by (used in)
financing activities (3,065,395) 6,496,514
----------- -----------
NET DECREASE IN CASH AND CASH
EQUIVALENTS (1,218,174) (547,518)
CASH AND CASH EQUIVALENTS,
beginning of period 1,244,745 623,656
----------- -----------
CASH AND CASH EQUIVALENTS, end of period $ 26,571 $ 76,138
=========== ===========
SUPPLEMENTAL DISCLOSURES:
Noncash investing and financing transactions:
Equipment acquired by
accounts payable $ 2,861,234 $ 925,716
Insurance premium financed -- 1,101,200
Cash Flow Information:
Income taxes paid $ 2,053,500 $ 1,335,400
Interest paid 22,856 275,781
</TABLE>
The accompanying notes are an integral part of these consolidated financial
statements.
5
<PAGE>
KNIGHT TRANSPORTATION, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Note 1. Financial Information
The accompanying consolidated financial statements include the parent company
Knight Transportation, Inc., and its wholly owned subsidiaries, Quad-K Leasing,
Inc.; KTTE Holdings, Inc., QKTE Holdings, Inc., and Knight Dedicated Services
Limited Partnership which is comprised of KTTE Holdings, Inc. as general partner
and QKTE Holdings, Inc. as sole limited partner (hereinafter collectively called
the "Company"). All material intercompany items and transactions have been
eliminated in consolidation.
The consolidated financial statements included herein have been prepared
pursuant to the rules and regulations of the Securities and Exchange Commission.
The statements presented do not include all information and footnotes required
to be in conformity with generally accepted accounting principles for complete
financial statements. In the opinion of management, all adjustments (consisting
of normal recurring adjustments) considered necessary for a fair presentation
have been included. Results of operations in interim periods are not necessarily
indicative of results for a full year. These consolidated financial statements
and notes thereto should be read in conjunction with the Company's consolidated
financial statements and notes thereto included in the Company's annual report
on Form 10-K for the year ended December 31, 1996. The preparation of financial
statements in accordance with generally accepted accounting principles requires
management to make estimates and assumptions. Such estimates and assumptions
affect the reported amounts of assets and liabilities as well as disclosure of
contingent assets and liabilities at the date of the accompanying consolidated
financial statements, and the reported amounts of the revenues and expenses
during the reporting periods. Actual results could differ from those estimates.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
Results of Operations
The operating revenue of Knight Transportation, Inc. and its subsidiaries (the
"Company") for the six months ended June 30, 1997, increased by 28.2% to $45.6
million from $35.6 million over the same period in 1996. For the three months
ended June 30, 1997, operating revenue increased by 27.8% to $24.2 million from
$19.0 million over the same period in 1996. The increase in operating revenue
resulted from expansion of the Company's customer base and increased volume from
existing customers, and was facilitated by the continued expansion of the
Company's fleet, including an increase in the Company's independent contractor
fleet. The Company's fleet increased by 33.3% to 677 tractors (including 185
owned by independent contractors) as of June 30, 1997, from 508 tractors
(including 146 owned by independent contractors) as of June 30, 1996. Despite
increases in revenue, the Company's revenue per mile declined to $1.22 per mile
for the six months ended June 30, 1997, from $1.24 per mile for the same period
in 1996 due to competitive conditions in the transportation industry.
6
<PAGE>
This decrease was offset by revenue increases resulting from the growth of the
Company's independent contractor program and increased equipment utilization. In
addition, the revenue per mile decrease was offset by the Company's expansion of
its operations with the commencement of dedicated service and regional
operations near Houston, Texas, and in Indianapolis, Indiana, respectively.
Salaries, wages and benefits decreased as a percentage of operating revenue to
27.8% for the six months ended June 30, 1997, from 28.4% for the same period in
1996. For the three months ended June 30, 1997, salaries, wages and benefits
decreased to 27.3% from 28.3% for the same period in 1996. These decreases were
primarily the result of the increase in the ratio of independent contractors to
company drivers.
Fuel expense decreased as a percentage of operating revenue to 10.3% for the six
months ended June 30, 1997, from 10.6% for the same period in 1996. For the
three months ended June 30, 1997, fuel expenses as a percentage of revenue
decreased to 10.3% from 10.7% for the same period in 1996. Although fuel costs
increased slightly for both the three and six month periods ended in 1997, the
Company was able to recoup a portion of the incremental increase with the
implementation of a fuel surcharge. Additionally, an increase in the Company's
independent contractor fleet contributed to the decrease in the Company's cost
of fuel as a percentage of revenue. Independent contractors are required to pay
their own fuel costs.
Operations and maintenance expense increased as a percentage of operating
revenue to 5.3% for the six months ended June 30, 1997, from 4.9% for the
corresponding period in 1996. For the three months ended June 30, 1997,
operation and maintenance expense as a percentage of revenue increased to 5.0%
from 4.8% for the same period in 1996. These increases were the result of
slightly higher maintenance costs related to the age of the Company's fleet.
Insurance and claims expense decreased as a percentage of operating revenue to
2.6% for the six months ended June 30, 1997, from 4.0% for the same period in
1996. For the three months ended June 30, 1997, insurance and claims expense
decreased to 2.9% from 4.2% for the same period in 1996. These decreases were
due to a reduction in insurance premium costs and a reduced amount of claims
incurred during the period.
Operating taxes and licenses increased as a percentage of revenue to 4.1% for
the six months ended June 30, 1997, from 3.8% for the same period in 1996. For
the three months ended June 30, 1997, operating taxes and licenses increased to
4.0% from 3.8% for the same period in 1996. These increases were due to higher
trailer licensing costs in California.
Communications and miscellaneous operating expenses as a percentage of revenues
for both the six months and three months ended June 30, 1997, were slightly
lower than the same periods in 1996.
Depreciation and amortization expense as a percentage of revenue remained
constant at 9.6% for the six month periods ended June 30, 1997, and 1996. For
the three months ended June 30, 1997, depreciation and amortization expense
decreased as a percentage of operating revenue to 9.4% from 9.6% for the same
period in 1996. This decrease was due to increased equipment utilization during
the period.
Purchased transportation increased as a percentage of operating revenue to 19.8%
for the six months ended June 30, 1997, from 18.4% for the same period in 1996.
For the three months ended June 30,
7
<PAGE>
1997, purchased transportation increased to 20.0% from 18.3% for the same period
in 1996. These increases were due to the reduction in revenue per mile.
Independent contractors are compensated on a mileage basis.
As a result of the above, the Company's operating ratio (operating expenses as a
percentage of operating revenue) for the six months ended June 30, 1997,
decreased to 82.6% from 82.9% for the same period in 1996. The Company's
operating ratio for the three months ended June 30, 1997, decreased to 81.9%
from 82.8% for the same period in 1996.
For both the six months and three months ended June 30, 1997, net other income
(expense) decreased as a percentage of revenue compared to the same periods in
1996. These decreases were primarily a result of the application of proceeds
from the Company's secondary stock offering in July 1996.
Income taxes have been provided at the statutory federal and state rates,
adjusted for certain permanent differences between financial statement and
income tax reporting.
As a result of the preceding changes, the Company's net income as a percentage
of operating revenue was 10.2% for the six months ended June 30, 1997, compared
to 9.5% for the same period in 1996 and 10.6% for the three months ended June
30, 1997, compared to 9.5% for the same period in 1996.
Liquidity and Capital Resources
The growth of the Company's business has required a significant investment in
new revenue equipment. The Company's primary source of liquidity has been funds
provided by operations and the Company's line of credit. Net cash provided by
operating activities was approximately $10.7 million for the first six months of
1997, compared to $7.1 million for the corresponding period in 1996.
Capital expenditures for the purchase of revenue equipment, net of trade-ins,
office equipment and leasehold improvements totaled $11.7 million for the first
six months of 1997 compared to $15.1 million for the same period in 1996.
Net cash used in financing activities and direct financing was approximately
$3.0 million for the first six months of 1997 compared to net cash provided by
financing activities of $7.6 million for the same period in 1996. Net cash used
in financing activities during the first six months of 1997 was the result of
the Company paying cash to fund the expansion of its equipment fleet rather than
drawing on its revolving line of credit as the Company did for the same period
in 1996.
The Company has a $10 million line of credit from its lender and uses that line
to finance the acquisition of revenue equipment and other corporate purposes to
the extent the cost of such acquisitions are not provided by funds from
operations. Under the Company's line of credit, the Company is obligated to
comply with certain financial covenants. The rate of interest on borrowings
against the line of credit will vary depending upon the interest rate elected by
the Company; the Company may elect the London Interbank Offered Rate (LIBOR),
the prime rate, or the lender's certificate of deposit rate. At June 30, 1997,
the Company had no outstanding borrowings under the revolving line of credit.
Management believes the Company has adequate liquidity to meet its current
needs. The Company will continue to have significant capital requirements over
the long term, which may require the Company to
8
<PAGE>
incur debt or seek additional equity capital. The availability of this capital
will depend upon prevailing market conditions, the market price of the common
stock and other factors over which the Company has no control, as well as the
Company's financial condition and results of operations.
Seasonality
To date, the Company's revenues have not shown any significant seasonal pattern.
Because the Company has operated primarily in Arizona, California and the
western United States, winter weather has not adversely affected the Company's
business. Expansion of the Company's operations into Texas and Louisiana, as
well as in the Midwest and on the East Coast, could expose the Company to
greater operating variances due to seasonal weather.
Inflation
Many of the Company's operating expenses, including fuel costs and fuel taxes,
are sensitive to the effects of inflation, which could result in higher
operating costs. The effects of inflation on the Company's business during the
six months ended June 30, 1997, were not significant.
Recently Issued Accounting Pronouncements
The Financial Accounting Standards Board has issued Statement of Financial
Accounting Standard No. 128, (SFAS No. 128) Earnings Per Share, which
established a new accounting principle for accounting for earnings per share.
The standard is effective for fiscal year ended December 31, 1997. When adopted,
SFAS No. 128 will require restatement of prior years' earnings per share. Pro
forma SFAS No. 128 earnings per share are as follows:
Three Months Ended Six Months Ended
6/30/97 6/30/96 6/30/97 6/30/96
------- ------- ------- -------
Basic EPS .26 .20 .47 .37
Diluted EPS .26 .20 .46 .37
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
The Company is party to ordinary, routine litigation and administrative
proceedings incidental to its business. These proceedings primarily involving
personnel matters, including EEOC claims and claims for personal injury or
property damage incurred in the transportation of freight. The company maintains
insurance to cover liabilities arising from the transportation of freight in
amounts in excess of self-insured retentions. It is the Company's policy to
comply with applicable equal employment opportunity laws and the Company
periodically reviews its policies and practices for equal employment opportunity
compliance.
9
<PAGE>
Item 2. Changes in Securities
Not Applicable
Item 3. Defaults Upon Senior Securities
Not Applicable
Item 4. Submission of Matters to a Vote of Security Holders
Not Applicable
Item 5. Other Information
Not Applicable
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits required by Item 601 of Regulation S-K
No. Description
--- -----------
Exhibit 4 Instruments defining the rights of security
holders, including indentures
(a) Articles 4, 10 and 11 of the Restated Articles
of Incorporation of the Company. (Incorporated
by reference to Exhibit 3.1 to the Company's
Report on Form 10-K for the fiscal year ended
December 31, 1994.)
(b) Sections 2 and 5 of the Amended and Restated
By-laws of the Company. (Incorporated by
reference to Exhibit 3.2 to the Company's
Report on Form 10-K for the fiscal year ended
December 31, 1995.)
Exhibit 11 Schedule of Computation of Net Income Per Share
Exhibit 27 Financial Data Schedule
(b) Reports on Form 8-K
The Company did not file any reports on Form 8-K during the three
month period ended June 30, 1997.
10
<PAGE>
Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
KNIGHT TRANSPORTATION, INC.
Date: August 12, 1997 By: /s/ Kevin P. Knight
---------------------------------------
Kevin P. Knight
Chief Executive Officer
Date: August 12, 1997 By: /s/ Clark Jenkins
---------------------------------------
Clark Jenkins
Chief Financial Officer and
Principal Financial Officer
11
<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
EXHIBITS TO
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1997
Commission File No. 0-24946
12
<PAGE>
KNIGHT TRANSPORTATION, INC.
INDEX TO EXHIBITS TO FORM 10-Q
Sequentially
Exhibit No. Description Numbered Pages(1)
- ---------- ----------- --------------
Exhibit 4 Instruments defining the rights of security
holders, including indentures
(a) Articles 4, 10 and 11 of the Restated
Articles of Incorporation of the Company.
(Incorporated by reference to Exhibit 3.1
to the Company's Report on Form 10-K for
the fiscal year ended December 31, 1994.)
(b) Sections 2 and 5 of the Amended and
Restated By-laws of the Company.
(Incorporated by reference to Exhibit 3.2
to the Company's Report on Form 10-K for
the fiscal year ended December 31, 1995.)
Exhibit 11 Schedule of Computation of Net Income Per Share
Exhibit 27 Financial Data Schedule
(1) The page numbers where exhibits (other than those incorporated by reference)
may be found are indicated only on the manually signed report.
13
KNIGHT TRANSPORTATION, INC.
AND SUBSIDIARIES
SCHEDULE OF COMPUTATION OF NET INCOME PER SHARE
(unaudited)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30 June 30
---------------------- ----------------------
1997 1996 1997 1996
---- ---- ---- ----
<S> <C> <C> <C> <C>
Primary and Fully diluted:
Common shares outstanding
beginning of period 9,904,500 9,102,000 9,904,500 9,102,000
Common share equivalents:
Employee stock options
outstanding & canceled (1)
Primary 177,176 115,560 173,683 88,934
Fully diluted 198,201 140,283 200,209 139,378
Employee stock options
exercised (1)
Primary
Fully diluted 989 -- 497 --
989 -- 497 --
---------- ---------- ---------- ----------
Number of common share and common
share equivalents outstanding
Primary 10,082,665 9,217,560 10,078,680 9,190,934
========== ========== ========== ==========
Fully diluted 10,103,690 9,242,283 10,105,206 9,241,378
========== ========== ========== ==========
Net Income 2,577,750 1,800,901 4,669,755 3,388,700
Net income per common share and
common share equivalent
Primary $ .26 $ .20 $ .46 $ .37
========== ========== ========== ==========
Fully diluted $ .26 $ .19 $ .46 $ .37
========== ========== ========== ==========
Notes:
(1) Amount calculated using the treasury stock method.
</TABLE>
EXHIBIT 11
14
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
LEGEND : THE SCHEDULE CONTAINS SUMMARY FINANCIAL
INFORMATION EXTRACTED FROM THE COMPANY'S
CONSOLIDATED FINANCIAL STATEMENTS AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> JUN-30-1997
<EXCHANGE-RATE> 1
<CASH> 26,571
<SECURITIES> 0
<RECEIVABLES> 11,417,478
<ALLOWANCES> 384,172
<INVENTORY> 439,927
<CURRENT-ASSETS> 14,409,100
<PP&E> 72,510,776
<DEPRECIATION> (15,639,159)
<TOTAL-ASSETS> 72,262,224
<CURRENT-LIABILITIES> 11,132,137
<BONDS> 0
0
0
<COMMON> 99,195
<OTHER-SE> 50,730,592
<TOTAL-LIABILITY-AND-EQUITY> 72,262,224
<SALES> 0
<TOTAL-REVENUES> 45,563,216
<CGS> 0
<TOTAL-COSTS> 37,637,133
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 23,672
<INCOME-PRETAX> 7,949,755
<INCOME-TAX> 3,280,000
<INCOME-CONTINUING> 4,669,755
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,669,755
<EPS-PRIMARY> .46
<EPS-DILUTED> .46
</TABLE>
