SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
AMENDMENT NO. 1
to
FORM 10-QSB
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended December 28, 1996
Commission file number 1-13656
OMNI MULTIMEDIA GROUP, INC.
(Exact name of small business issuer as specified in its charter)
Delaware 04-2729490
(State of Organization) (I.R.S. Employer
Identification Number)
50 Howe Avenue
Millbury, Massachusetts 01527
(508) 865-4451
(Address, including zip code, and telephone number,
including area code, of issuer's principal executive offices)
Indicate by check mark whether the issuer (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities and Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports) and (2) has been subject to such
filing requirements for the past 90 days.
Yes X No
Indicate the number of shares outstanding of each of the issuer's
classes of common stock, as of the latest practicable date.
Class Number of Shares Outstanding
as of February 13, 1997
Common Stock, $.01 par value 9,511,623
OMNI MULTIMEDIA GROUP, INC.
INDEX
Part I. Financial Information.
Item 1. Financial Statements Page
Condensed Consolidated Balance Sheet -
as of March 30, 1996 (Audited) and December 28, 1996 (Unaudited)..... 2
Condensed Consolidated Statements of Operations (Unaudited)
for the three and nine month periods ended December 28, 1996
and December 30, 1995................................................ 4
Condensed Consolidated Statements of Cash Flows (Unaudited)
for the nine months ended December 28, 1996 and December 30, 1995.... 5
Notes to Condensed Consolidated Financial Statements................... 6
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations............... 7
Part II. Other Information.
Item 1. Legal Proceedings............................................ 10
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
- ----------
OMNI MULTIMEDIA GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
<TABLE>
<CAPTION>
ASSETS
<S> <C> <C>
December 28, March 30,
1996 1996
(Unaudited) (Audited)
Current Assets
Cash and cash equivalents $5,209,426 $ 5,706,822
Accounts receivable, net of
allowance for doubtful accounts
of $250,000 at December 28, 1996
and $25,000 at March 30, 1996 3,131,729 1,306,212
Stock Subscriptions -- 1,790,374
Inventories 1,299,909 966,665
Prepaid expenses and other
current assets 841,545 812,103
Deferred tax assets, net 101,844 101,844
------------- -------------
10,584,453 10,684,020
Property and equipment, net 20,966,263 8,427,275
Due from related parties 661,872 532,761
Other assets, net 1,450,821 954,230
-------------- --------------
$ 33,663,409 $20,598,286
============ ===========
</TABLE>
The accompanying notes are an integral part
of these consolidated financial statements.
-1-
OMNI MULTIMEDIA GROUP, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
<S> <C> <C>
December 28, March 30,
1996 1996
(Unaudited) (Audited)
Current liabilities
Accounts payable $ 2,005,637 $ 1,775,225
Line of credit 1,806,315 1,068,967
Current portion of long-term debt
and capital lease obligations 2,888,000 1,025,600
Accrued expenses 925,212 332,561
Income taxes payable -- 190,063
------------------ ---------------
7,625,164 4,392,416
------------ --------------
Long-term debt 4,377,142 2,207,479
Capital lease obligations 8,665,123 1,760,919
Deferred tax liability 141,761 141,761
--------------- ---------------
13,184,026 4,110,159
---------- ---------
Stockholders' Equity
Convertible Preferred stock; $.01 par value;
1,000,000 shares authorized; 14 Series A shares
issued and outstanding 1 --
Common Stock; $.01 par value; 14,000,000 shares
authorized; 9,444,476 shares issued and outstanding
at December 28, 1996 38,909 38,899
Additional paid-in-capital 21,238,646 11,635,675
Retained earnings (accumulated deficit) (7,689,181) 421,137
------------- ---------------
13,488,375 12,095,711
Less cost of treasury stock (634,156) --
-------------- -----------------
12,854,219 12,095,711
---------- ----------
$ 33,663,409 $ 20,598,286
============ ============
</TABLE>
The accompanying notes are an integral part
of these consolidated financial statements.
-2-
OMNI MULTIMEDIA GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
December 28, December 30, December 28, December 30,
1996 1995 1996 1995
------ ------ ------ -----
<S> <C> <C> <C> <C>
Net sales $ 4,009,797 $ 7,409,591 $ 8,625,275 $15,121,368
Cost of goods sold 4,402,877 5,545,520 10,274,001 11,329,189
-------------- ------------- ------------- -----------
Gross profit(loss) ( 393,080) 1,864,071 ( 1,648,726) 3,792,179
--------------- ------------- ------------- ------------
Operating expenses
Selling 1,371,084 532,370 2,986,717 1,503,979
General and administrative 1,288,368 530,573 2,810,965 1,383,819
--------------- -------------- -------------- ------------
2,659,452 1,062,943 5,797,682 2,887,798
--------------- ------------- --------------
Income (loss) from operations ( 3,052,532) 801,128 ( 7,446,408) 904,383
Other income 260,585 26,555 503,951 64,945
---------------- --------------- --------------- --------------
( 2,791,947) 827,683 6,942,457 969,328
Other expenses
Interest expense 439,024 84,438 864,737 176,307
Write-off of deferred finance costs -- 91,777 -- 91,777
Other expenses 234,350 1,200 303,124 2,445
---------------- ---------------- --------------- ---------------
673,374 177,415 1,167,861 270,529
--------------- -------------- -------------- -------------
Income (loss) before income taxes ( 3,465,321) 650,268 ( 8,110,318) 698,799
Income tax provision -- 266,000 -- 290,000
-------------------- -------------- -------------------- -------------
Net income (loss) $ (3,465,321) $ 384,268 $ (8,110,318) $ 408,799
============= ============= ============= ============
Primary net income (loss) per share $ (0.44) $ 0.13 $ (1.55) $ 0.15
Primary weighted average common shares
outstanding 7,815,740 2,957,206 5,246,307 2,756,974
Fully diluted net income (loss) per
share $ (0.37) $ 0.13 $ (0.95) $ 0.15
Fully diluted weighted average common
shares outstanding 9,444,476 2,957,206 8,498,149 2,756,974
</TABLE>
The accompanying notes are an integral part
of these consolidated financial statements.
-3-
OMNI MULTIMEDIA GROUP, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
<TABLE>
<CAPTION>
<S> <C> <C>
Nine Months Ended
December 28, December 30,
1996 1995
------ -----
Cash flows from operating activities:
Net income (loss) $ (8,110,318) $ 408,799
Adjustments to reconcile net income (loss) to net cash used in operating
activities:
Depreciation and amortization 1,784,306 398,178
Warrants issued in connection with stock restructuring 200,000 --
Write off of deferred finance costs -- 91,777
Provision for losses on accounts receivable 345,183 21,570
Gain (loss) on disposal of fixed asset (590) 26,265
Increase in accounts receivable (743,204) (3,154,919)
Increase in inventories (95,851) (522,144)
(Increase) decrease in prepaid expenses and other current assets 30,922 (450,451)
Increase in deferred income taxes -- 39,000
Increase in other assets (386,208) (339,109)
Increase (decrease) in accounts payable (396,807) 1,290,366
Increase (decrease) in accrued expenses (50,757) 50,511
Increase (decrease) in income taxes payable (190,063) 254,107
------------- -------------
Net cash used in operating activities (7,613,387) (1,886,020)
---------- ----------
Cash flows from investing activities:
Expenditures for property and equipment (4,646,203) (1,470,973)
Proceeds from sale of fixed assets 18,100 --
Purchase of Allenbach Industries, Inc., net of cash acquired 125,971 --
-------------- --------------
Net cash used in investing activities (4,502,132) (1,470,973)
---------- ----------
Cash flows from financing activities:
Repayments on long-term borrowing and capital lease obligations (1,494,968) (738,264)
Repayments on notes payable - redeemable Common Stock -- (346,000)
Repayments on notes payable - redeemable Preferred Stock -- (307,000)
Repayments on Interim financing -- (325,000)
Proceeds from long term borrowing 3,342,900 579,138
Advances (Repayments) on revolving line of credit, net (464,217) 565,384
Decrease in subscription receivable 1,790,374 --
Proceeds from issuance of Preferred Stock 9,352,982 --
Purchase of treasury stock (684,156) --
Repayments on loans from stockholders -- (25,000)
Proceeds from issuance of Common Stock -- 4,081,496
Increase in due from related parties (129,111) (27,314)
Increase in debt issue costs (95,681) --
-------------- ------------
Net cash provided by financing activities 11,618,123 3,457,440
---------- ---------
Increase (decrease) in cash and cash equivalents (497,346) 100,447
Cash and cash equivalents, beginning of period 5,706,822 266,674
-------------- ------------
Cash and cash equivalents, end of period $ 5,209,426 $ 367,121
============== ============
The accompanying notes are an integral part of these consolidated
financial statements.
</TABLE>
-4-
OMNI MULTIMEDIA GROUP, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 1. Basis of Presentation
The accompanying unaudited condensed consolidated financial statements
of OMNI MultiMedia Group, Inc. (the "Company") have been prepared in accordance
with generally accepted accounting principles for interim financial information
and with the instructions to Form 10-QSB and Item 310(b) of Regulation S-B.
Accordingly, they do not include all of the information and footnotes required
by generally accepted accounting principles for complete consolidated financial
statements.
In the opinion of management, all adjustments (consisting solely of
normal recurring adjustments) considered necessary for a fair statement of the
interim financial data have been included. Results of operations for the three
and nine month periods ended December 28, 1996 are not necessarily indicative of
the results that may be expected for the fiscal year ending March 29, 1997.
For further information, refer to the consolidated financial statements
and the footnotes thereto for the year ended March 30, 1996, contained in the
Company's Annual Report on Form 10-KSB.
Net income (loss) per share is computed based upon the weighted average
number of common and dilutive common equivalent shares outstanding during the
period.
Note 2. Allenbach Industries, Inc. Acquisition
On October 4, 1996, the Company, through a wholly-owned subsidiary,
completed the acquisition of substantially all of the assets of Allenbach
Industries, Inc. ("Allenbach"), a privately held corporation having its
principal place of business in San Jose, California. Allenbach conducts a
software manufacturing and fulfillment business, maintaining manufacturing
facilities in San Jose, California and Bloomington, Minnesota. The acquisition
of Allenbach has been recorded in accordance with the purchase method of
accounting.
The unaudited pro forma condensed combining statements of operations
for the nine months ended December 28, 1996 and December 30, 1995 present the
results of the Company assuming that the acquisition of all assets and
assumption of all liabilities of Allenbach had been consummated as of the
beginning of the period indicated. The following pro forma data is presented for
illustrative purposes only and is not necessarily indicative of the results of
operations which would have been actually achieved had the acquisition of
Allenbach occurred at the beginnings of the periods.
Nine Months Ended
December 28, December 30
1996 1995
---------------- -----------
Net Sales $ 15,090,629 $ 27,624,318
Cost of goods sold 15,610,303 22,252,310
------------- -------------
Gross profit (loss) (519,674) 5,372,008
------------- -------------
Operating expenses:
Selling 3,993,339 2,574,302
General and administration 3,865,550 2,899,320
-------------- ------------
7,858,889 5,473,622
-------------- ------------
Loss from operations (8,378,563) (101,614)
------------- -------------
Other income 536,889 102,230
------------- -------------
Other expenses
Interest expense (987,871) (369,448)
Other expenses (328,142) (103,793)
--------------- ------------
(1,316,013) (473,241)
--------------- ------------
Net loss $ (9,157,687) $ (472,625)
=============== ============
Pro forma primary net loss per share $ (1.75) $ (0.18)
Pro forma fully diluted net loss
per share $ (1.08) $ (0.18)
-5-
Item 1. Management's Discussion and Analysis of Financial Condition
and Results of Operations
General
The following discussion and analysis should be read in conjunction
with the Condensed Consolidated Financial Statements of the Company (including
the Notes thereto) appearing elsewhere in this Report. This report contains
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995, which statements can be identified by the use of
forward-looking terminology such as "may," "will," "would," "can," "could,"
"intend," "plan," "expect," "anticipate," "estimate," or "continue" or the
negative thereof or other variations thereon or comparable terminology. The
following forward-looking statements include certain risks and uncertainties
that could cause actual results to differ materially from those in such
forward-looking statements. Potential investors are urged to carefully consider
the risks associated with an investment in the Company's securities.
-6-
Three Months Ended December 28, 1996 ("Third Quarter 1997") compared to
the Three Months Ended December 30, 1995 ("Third Quarter 1996").
Net sales decreased to $4,009,797 for Third Quarter 1997, a decrease of
46% over net sales of $7,409,591 in Third Quarter 1996. This decrease was
primarily due to the faster than expected decline in demand for software
duplication services for 3 1/2" diskettes, which the Company believes to be
industry-wide. This decline was combined with the start-up phase of the
Company's CD-ROM manufacturing facility, which did not become fully operational
until the end of the second fiscal quarter.
In Third Quarter 1997, the Company brought its CD-ROM manufacturing
facility to productivity levels greater than or equal to industry standards,
strengthened its sales force in all three of its locations (California,
Minnesota and Massachusetts) and completed the acquisition of Allenbach. The
Company anticipates that these activities, combined with its 4CDs electronic
catalog and its new encryption program, will result in sales growth and improved
performance during future quarters.
Selling expenses in Third Quarter 1997 were $1,371,084, a 157% increase
over selling expenses of $532,370 in Third Quarter 1996. This increase was
primarily due to increased advertising costs, the cost of hiring ten additional
members of the sales staff and a Director of Marketing, and increased payroll
associated with the operation of the Company's sales organization in California.
General and administrative expenses were $1,288,368 in Third Quarter
1997, a 143% increase over general and administrative expenses of $530,573 in
Third Quarter 1996. This increase was primarily due to increases in
administrative staffing associated with the California facility, improving and
integrating its MIS and SIMIX manufacturing systems, and the greater cost of
operating three facilities, as well as increased travel, consulting, public
relations and professional fees related to the Company's acquisitions and
increaded stockholder activity.
During Third Quarter 1997, the Company incurred a one-time charge of
$186,000 in connection with the restructuring of its Series A Convertible
Preferred Stock (the "Preferred Stock"). This amount represents the issuance of
$50,000 of Common Stock and the issuance of 300,000 warrants with a fair market
value of $136,000 for investment advisory services associated with the purchase
or redemption of Preferred Stock by the Company and a group of private
investors.
-7-
During Third Quarter 1997, the Company and a private investor group either
purchased or redeemed approximately $3,600,000 of the Company's Preferred Stock.
Of the 1,050 shares of Preferred Stock issued in May 1996, only 14 shares remain
issued and outstanding after giving effect to conversions by the private
investors subsequent to purchasing the Preferred Stock.
As a result of decreases in net sales and increased costs of sales,
selling, general and administrative expenses, the Company incurred a loss from
operations of $3,052,232 in Third Quarter 1997, as contrasted to income from
operations of $801,128 in Third Quarter 1996.
As a result of the factors described above, the Company incurred a net
loss $3,465,321 in Third Quarter 1997 as compared to net income of $384,268 in
Third Quarter 1996. This translates to a net loss of $ 0.44 and $ 0.37 for
primary and fully diluted earnings per share, respectively, in Third Quarter
1997 as contrasted to a net profit of $0.13 per share in Third Quarter 1996.
During Third Quarter 1997, there were 7,815,740 and 9,444,476 common shares
outstanding on a weighted average basis for primary and fully diluted earnings
per share, respectively, as contrasted to 2,957,206 shares issued and
outstanding on a weighted average basis for Third Quarter 1996.
NINE MONTHS ENDED DECEMBER 28, 1996 COMPARED TO THE NINE MONTHS ENDED DECEMBER
30, 1995.
For the nine months ended December 28, 1996, net sales were $8,625,275,
a 43% decrease over net sales of $15,121,368 for the nine months ended December
30, 1995. This decrease is primarily due to the faster than expected decline in
demand for software duplication services for 3 1/2" diskettes, which the Company
believes to be industry-wide and which coincided with the start-up phase of the
Company's CD-ROM manufacturing facility. During the first quarter of the current
fiscal year ("First Quarter 1997"), the Company concentrated its efforts in
completing the CD-ROM manufacturing facility and in hiring sales staff and
manufacturing personnel to run this new manufacturing operation. As a result,
virtually all of the Company's net sales during First Quarter 1997 were from
software duplication and related printing activities. During the second quarter
of the current fiscal year ("Second Quarter 1997"), the demand for software
duplication services declined significantly. The Company's CD-ROM manufacturing
facility did not become fully operational until the end of the Second Quarter
1997. With several CD-ROM manufacturing lines now running, the Company expects
revenues from its CD-ROM manufacturing operations to increase and anticipates
continued increased production from the facility over time. The facility has
room for additional capacity and management expects to add additional capacity
over time on an as-needed basis.
In addition, during First Quarter 1997, the Company's 4CD's electronic
catalog appeared on the Internet on a trial basis. However, during Second
Quarter 1997, the Company delayed its planned promotion of 4CD's while it added
five language capabilities for product descriptions. The Company is now actively
soliciting orders on the Internet, and while initial sales have been modest, the
Company expects sales in this sector to increase in the near term.
Selling expenses during the nine months ended December 28, 1996 were
$2,986,717, a 99% increase over selling expenses of $1,503,979 during the nine
months ended December 30, 1995. This increase was primarily attributable to
increased advertising costs, increased payroll associated
-8-
with the Company's sales organization in California, expansion of the Company's
sales force and increased staffing for its CD-ROM manufacturing operations.
General and administrative expenses increased to $2,810,965 for the
nine months ended December 28, 1996, as compared to $1,383,819 for the nine
months ended December 30, 1995, an increase of 103%. These increased general and
administrative expenses reflect increases in staffing, particularly
administrative staffing associated with the California facility, the Company's
improving and integrating its MIS and SIMEX manufacturing systems, the greater
cost of operating three facilities, and increased travel, consulting, public
relations and professional fees related to the Company's growth, acquisition,
and increased stockholder activity.
Other expenses, principally interest expense, increased to $1,167,861
for the nine months ended December 28, 1996, a 332% increase over $270,529 for
the nine months ended December 30, 1995. The increase in interest expense was
due to increased borrowing on the Company's revolving line of credit and
increased interest expense associated with new equipment leasing arrangements.
In addition, during Third Quarter 1997, the Company incurred a one-time charge
of $186,000 in connection with the restructuring of its Series A Convertible
Preferred Stock.
As a result of decreases in net sales and increased selling and general
and administrative expenses, the Company incurred a loss from operations of
$7,446,408 for the nine months ended December 28, 1996, as contrasted to income
from operations of $904,383 for the nine months ended December 30, 1995.
As a result of the factors described above, the Company incurred a net
loss of $8,110,318 for the nine months ended December 28, 1996, as compared to
net income of $408,799 for the nine months ended December 30, 1995. This
translates to a net loss of $1.55 and $0.95 for primary and fully diluted
earnings per share, respectively, for the nine months ended December 28, 1996,
as contrasted to a net profit of $0.15 per share for the nine months ended
December 30, 1995. For the nine months ended December 28, 1996, there were
5,246,307 and 8,498,149 common shares outstanding on a weighted average basis
for primary and fully diluted earnings per share, respectively, as contrasted to
2,756,974 common shares issued and outstanding on a weighted average basis for
the nine months ended December 30, 1995.
LIQUIDITY AND CAPITAL RESOURCES
Management anticipates that its current cash position, together with
cash generated from anticipated results of operations and credit and equipment
lease facilities will be adequate for at least the next 12 months. The Company
routinely explores acquisitions and, although not currently anticipated, the
Company may seek additional capital to finance future acquisitions, strategic
partnerships, or to provide additional working capital. Should results of
operations not be as anticipated, the Company may be required to seek additional
financing which may not be available on terms favorable to the Company, if at
all.
At December 28, 1996, the Company had cash and cash equivalents of
$5,209,426. Cash used in operating activities for the nine months ended December
28, 1996 was $7,613,387, compared to cash used in operating activities for the
nine months ended December 30, 1995 of $1,886,020, primarily reflecting the net
loss for the period. Cash used in investing activities included $4,646,203 of
expenditures for property and equipment in connection with the start-up of the
-9-
Company's CD-ROM manufacturing facility. Cash provided by financing activities
was $11,618,123 during the nine months ended December 28, 1996, reflecting
principally the proceeds from the issuance of the Company's Series A Preferred
Stock in May 1996.
-10-
Part II. Other Information.
Item 1. Legal Proceedings.
[Not applicable.]
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.
No matters have been submitted to a vote of security-holders during the
period covered by this report.
Item 5. Other Information.
Not applicable.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
Exhibit 11. Statement regarding computation of per share earnings.
Exhibit 27. Financial Data Schedule.
(b) Reports on Form 8-K.
The Company filed an amendment to a Current Report on Form 8-K/A
to include the audited financial statements of Allenbach Industries, Inc. for
the fiscal years ended December 31, 1994 and 1995 and the unaudited pro-forma
condensed combined financial statements of the Registrant.
-11-
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.
OMNI MULTIMEDIA GROUP, INC.
Date: February 25, 1997 By: /s/ Paul F. Johnson
--------------------
Paul F. Johnson, President and
Chief Executive Officer
Date: February 25, 1997 By: /s/ Robert E. Lee
------------------
Robert E. Lee, Treasurer and
Chief Financial Officer
-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.
OMNI MULTIMEDIA GROUP, INC.
Date: February 25, 1997 By: PAUL F. JOHNSON
-----------------------------
Paul F. Johnson, President and
Chief Executive Officer
Date: February 25, 1997 By: ROBERT E. LEE
-------------------------
Robert E. Lee, Treasurer and
Chief Financial Officer
EXHIBIT 11
OMNI MULTIMEDIA GROUP, INC.
COMPUTATION OF NET INCOME (LOSS) PER SHARE
(Unaudited)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
December 28, December 30, December 28, December 30,
1996 1995 1996 1995
------ ------ ------ -----
<S> <C> <C> <C> <C>
Net income(loss) $ (3,465,321) $ 384,268 $ (8,110,318) $ 408,799
Primary weighted common
shares outstanding:
Common Stock 7,815,740 2,751,500 5,246,307 2,667,167
Stock options -- (1) 64,651 -- (1) 49,905
Stock warrants -- (1) 141,055 -- (1) 39,902
----------- ----------- --------------
Primary weighted average
shares 7,815,740 2,957,206 5,246,307 2,756,974
=========== =========== ============== ============
Primary net income (loss)
per share ($ 0.44) 0.13 ($ 1.55) $ 0.15
=========== =========== ============== ============
Fully diluted weighted
common shares outstanding:
Common Stock 7,815,740 2,751,500 5,246.307 2,667,167
Stock Options --(1) 64,651 --(1) 49,905
Stock Warrants --(1) 141,055 --(1) 39,902
Shares attributable
to Preferred Stock
converted using the
if converted method 1,628,736 -- 3,251,842 --
------------ ------------ ------------- ------------
Fully diluted weighted
average shares 9,444,476 2,957,206 8,498,149 2,756,974
============ ============ ============= ============
Fully diluted net income
(loss) per share ($ 0.37) $ 0.13 ($ 0.95) $ 0.15
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
COMPANY'S BALANCE SHEET AT DECEMBER 28, 1996 AND THE COMPANY'S STATEMENT OF
OPERATIONS FOR THE THREE MONTHS ENDED DECEMBER 28, 1996 AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> MAR-29-1997
<PERIOD-END> DEC-28-1996
<CASH> 5,209,426
<SECURITIES> 0
<RECEIVABLES> 3,381,729
<ALLOWANCES> 250,000
<INVENTORY> 1,299,909
<CURRENT-ASSETS> 10,584,453
<PP&E> 24,762,089
<DEPRECIATION> 3,795,826
<TOTAL-ASSETS> 33,663,409
<CURRENT-LIABILITIES> 7,625,164
<BONDS> 0
0
1
<COMMON> 38,909
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 33,663,409
<SALES> 4,009,797
<TOTAL-REVENUES> 4,009,797
<CGS> 4,402,877
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 234,350
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 439,024
<INCOME-PRETAX> (3,465,321)
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,465,321)
<EPS-PRIMARY> (0.44)
<EPS-DILUTED> (0.37)
</TABLE>
