SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10 - QSB
(Mark One)
/X / QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1997
/ / 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: 0-25918
-------
ACTIVE APPAREL GROUP, INC.
(Exact name of small business issuer as specified in its charter)
Delaware 13-3672716
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
1350 Broadway
Suite 2300
New York, NY 10018
(Address of Principal Executive Offices)
(212) 239-0990
(Issuer's telephone number)
Not Applicable
(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 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 common equity shares outstanding as of August 9, 1997,
was 2,469,375 shares of Common Stock, $.002 par value, and 100,00 shares of
Class A Common Stock, $.01 par value.
Transitional Small Business Disclosure Format (check one):
Yes / / No /X/
Form 10-QSB
<PAGE>
INDEX
PART I. FINANCIAL INFORMATION Page
Item 1. Financial Statements
Balance Sheets 3
Statements of Income 4
Statements of Changes in Stockholders' Equity 5
Statements of Cash Flows 6
Notes to Financial Statements 7
Item 2. Management's Discussion and Analysis
of Financial Condition and Results of
Operations 8-10
PART II. OTHER INFORMATION
Item 2. Changes in Securities 11
Item 4. Submission of Matters to a Vote of Security Holders 11
Item 6. Exhibits and Reports on Form 8-K 11
SIGNATURE 12
- 2 -
<PAGE>
ACTIVE APPAREL GROUP, INC.
BALANCE SHEETS
<TABLE>
<CAPTION>
June 30, December 31,
1 9 9 7 1 9 9 6
-------- -------
Unaudited)
ASSETS
Current assets:
<S> <C> <C>
Cash and cash equivalents 210,287 $ 163,241
Due from factor 1,478,998 2,896,273
Inventory 3,975,679 2,757,700
Prepaid royalties 36,263 52,513
Prepaid expenses and other current assets 335,734 122,807
----------- -----------
Total current assets 6,036,961 5,992,534
Note receivable, officer 120,000 120,000
Property and equipment, net 369,995 292,777
Security deposits and other assets 474,877 339,968
---------- ----------
Total Assets $7,001,833 $6,745,279
=========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable 764,892 $ 552,858
Accrued expenses and other current liabilities 209,282 499,500
------------ -----------
Total current liabilities 974,174 1,052,358
------------ -----------
Stockholders' equity:
Common stock, par value $.002; 10,000,000 shares
authorized, 2,641,875 issued, 2,469,375 outstanding
(1997); 10,000,000 shares authorized, 2,620,237
issued, 2,447,737 outstanding (1996) 5,283 5,240
Class A common stock, par value $.01; 100,000 shares
authorized; 100,000 shares issued and outstanding 1,000 1,000
Paid-in capital 6,124,891 6,054,035
------------- ------------
Retained earnings (accumulated deficit) 622,110 358,271
6,753,284 6,418,546
Less treasury stock, at cost (172,500 common shares) (725,625) (725,625)
------------- ------------
Total Stockholders' Equity 6,027,659 5,692,921
------------- ------------
Total Liabilities and Stockholders' Equity $7,001,833 $6,745,279
============= ============
</TABLE>
- 3 -
See accompanying notes to financial statements.
<PAGE>
ACTIVE APPAREL GROUP, INC.
STATEMENTS OF INCOME
<TABLE>
<CAPTION>
Six months ended Three months ended
June 30, June 30,
---------------------------- -----------------------------------
1 9 9 7 1 9 9 6 1 9 9 7 1 9 9 6
------- ------- ------- -------
(Unaudited) (Unaudited) (Unaudited) (Unaudited)
<S> <C> <C> <C> <C>
Net sales $8,002,699 $7,164,593 $3,981,678 $3,217,744
Cost of goods sold 4,842,665 4,379,244 2,445,364 1,950,568
---------- ---------- ---------- ----------
Gross profit 3,160,034 2,785,349 1,536,314 1,267,176
---------- ---------- ---------- ----------
Operating expenses:
Selling and shipping 1,583,992 1,330,689 804,366 582,634
General and administrative 938,786 820,628 440,535 432,578
Financial expenses, including interest
expense of $40,180 and $7,558 for the
six months ended June 30,1997 and 1996 180,777 144,075 94,043 64,896
---------- ---------- ---------- ----------
2,703,555 2,295,392 1,338,944 1,080,108
---------- ---------- ---------- ----------
Income from operations 456,479 489,957 197,370 187,068
Other income 3,228 17,383 3,228 13,239
---------- ---------- ---------- ----------
Income before provision for income taxes 459,707 507,340 200,598 200,307
Provision for income taxes 195,868 110,033 85,949 33,502
---------- ---------- ---------- ----------
Net income $ 263,839 $ 397,307 $ 114,649 $ 166,805
========== ========== ========== ==========
Primary earnings per share $.10 $.15 $.04 $.06
===== ===== ===== =====
</TABLE>
- 4 -
See accompanying notes to financial statements.
<PAGE>
ACTIVE APPAREL GROUP, INC.
STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY
SIX MONTHS ENDED JUNE 30, 1997 and 1996
<TABLE>
<CAPTION>
9% cumulative
convertible Class A
Preferred stock Common stock Common stock
--------------------- --------------------- ------------------
Shares Amount Shares Amount Shares Amount
------ ------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
Balance, December 31, 1995 4,000 $1,000 2,439,437 $5,224 100,000 $1,000
Stock options exercised - - 5,300 10 - -
Redemption of preferred stock (1,000) (250) - - - -
Public offering costs - - - - - -
Net income, six months ended June 30, 1996 - - - - - -
----- ------ --------- ------ ------- -------
Balance, June 30, 1996 3,000 $ 750 2,444,737 $5,234 100,000 $1,000
===== ====== ========= ====== ======= =======
Balance, December 31, 1996 - $ - 2,447,737 $5,240 100,000 $1,000
Stock options exercised - - 21,638 43 - -
Net income, six months ended June 30, 1997 - - - - - -
----- ------ --------- ------ ------- -------
Balance, June 30, 1997 - $ - 2,469,375 $5,283 100,000 $1,000
===== ====== ========= ====== ======= =======
</TABLE>
<TABLE>
<CAPTION>
Retained
earnings Treasury stock
Paid-in (accumulated ---------------------
Capital deficit) Shares Amount Total
------- -------- ------ ------ -----
<S> <C> <C> <C> <C> <C>
Balance, December 31, 1995 $6,057,764 $(352,977) 172,500 $ (725,625) $ 4,986,386
Stock options exercised 1,977 - - - 1,987
Redemption of preferred stock (2,250) - - - (2,500)
Public offering costs (4,200) - - - (4,200)
Net income, six months ended June 30, 1996 - 397,307 - - 397,307
---------- ------------- --------------- ------------ ----------
Balance, June 30, 1996 $6,053,291 $ 44,330 172,500 $(725,625) $5,378,980
========== ============= =============== ============ ==========
Balance, December 31, 1996 $6,054,035 $ 358,271 172,500 $(725,625) $5,692,921
Stock options exercised 70,856 - - - 70,899
Net income, six months ended June 30, 1997 - 263,839 - - 263,839
---------- ------------- --------------- ------------ ----------
Balance, June 30, 1997 $6,124,891 $ 622,110 172,500 $(725,625) $6,027,659
========== ============= =============== ============ ==========
</TABLE>
- 5 -
See accompanying notes to financial statements.
<PAGE>
ACTIVE APPAREL GROUP, INC.
STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
Six months ended
June 30,
-----------------------------------------
1 9 9 7 1 9 9 6
------- -------
Unaudited) (Unaudited)
<S> <C> <C>
Cash flows from operating activities:
Net income $263,839 $ 397,307
Adjustments to reconcile net income to net
Cash provided by operating activities:
Depreciation 56,539 22,975
Deferred tax provision - 63,664
Loss on disposal of property and equipment - 252
Changes in assets (increase) decrease:
Due from factor 1,417,275 43,831
Inventory (1,217,979) (36,724)
Prepaid expenses and other current assets (212,927) (161,452)
Prepaid royalties 16,250 118
Security deposits and other assets (134,909) (28,849)
Changes in liabilities increase (decrease):
Accounts payable 212,034 5,509
Accrued expenses and other current liabilities (290,218) (164,631)
---------- -----------
Net cash provided by operating activities 109,904 142,000
---------- -----------
Cash flows used by investing activities:
Acquisition of property and equipment (133,757) (87,230)
---------- -----------
Cash flows from financing activities:
Initial public offering costs - (4,200)
Redemption of preferred stock - (2,500)
Proceeds from stock options exercised 70,899 1,987
---------- -----------
Net cash provided (used) by financing activities 70,899 (4,713)
---------- -----------
Net increase in cash and cash equivalents 47,046 50,057
Cash and cash equivalents, beginning of period 163,241 134,344
---------- -----------
Cash and cash equivalents, end of period $210,287 $ 184,401
========== ===========
Supplemental disclosures of cash flow information:
Cash paid during the period for:
Interest $ 40,180 $ 7,558
Income taxes 505,192 37,082
</TABLE>
*Certain items have been reclassified to conform to 1997 presentation.
- 6 -
See accompanying notes to financial statements.
<PAGE>
ACTIVE APPAREL GROUP, INC.
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 1997 AND 1996
1. The Company and basis of presentation:
The financial statements presented herein as of June 30, 1997 and for
the six months ended June 30, 1997 and 1996 are unaudited and, in the
opinion of management, include all adjustments (consisting only of
normal and recurring adjustments) necessary for a fair presentation of
financial position and results of operations. Such financial statements
do not include all of the information and footnote disclosures normally
included in audited financial statements prepared in accordance with
generally accepted accounting principles. The accompanying unaudited
financial statements have been prepared in accordance with the
instructions to Form 10-QSB. The results of operations for the six and
three month periods ended June 30, 1997 are not necessarily indicative
of the results that may be expected for any other interim period or the
full year ending December 31, 1997.
2. Initial public offering:
On May 4, 1995, the Company completed an initial public offering of
640,000 shares of common stock at $6.25 per share. Proceeds to the
Company, after deducting initial public offering costs of $319,180, were
$3,680,820.
3. Primary earnings per share:
Primary earnings per share amounts are computed based on the weighted
average number of shares actually outstanding plus the shares that would
be outstanding assuming the exercise of dilutive stock options, all of
which are considered to be common stock equivalents. The number of
shares that would be issued from the exercise of stock options has been
reduced by the number of shares that could have been purchased from the
proceeds at the average market price of the convertible preferred stock.
The number of shares used in the computations were 2,678,483 and
2,698,248 at June 30, 1997 and 1996, respectively.
Fully diluted earnings per share amounts are not presented for June 30,
1997 and 1996 because they are not materially dilutive.
-7-
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
THIS REPORT ON FORM 10-QSB CONTAINS FORWARD-LOOKING STATEMENTS THAT
INVOLVE RISKS AND UNCERTAINTIES. THE COMPANY'S ACTUAL RESULTS COULD DIFFER
MATERIALLY FROM THOSE ANTICIPATED IN THESE FORWARD-LOOKING STATEMENTS. FACTORS
THAT MAY CAUSE SUCH DIFFERENCES INCLUDE, BUT ARE NOT LIMITED TO, THE COMPANY'S
EXPANSION INTO NEW MARKETS, COMPETITION, TECHNOLOGICAL ADVANCES AND AVAILABILITY
OF MANAGERIAL PERSONNEL.
GENERAL
The Company is a designer, marketer and supplier of women's activewear
and sportswear, and unisex activewear and accessories. The Company sells its
principal product collections under the Everlast, Converse and MTV brand names
through exclusive licensing arrangements. The Company's products are
manufactured by third party independent manufacturing contractors and are sold
to approximately 500 separate accounts, representing approximately 20,000 retail
locations throughout the United States and Canada, including a variety of
department stores, specialty stores, sporting goods stores, catalog operations
and better mass merchandisers.
On May 4, 1995 the Company completed an initial public offering of
640,000 shares of Common Stock at $6.25 per share. Proceeds to the Company,
after deducting initial public offering costs of $319,180, were $3,680,820.
The financial statements of the Company and the notes thereto contain
detailed information that should be referred to in conjunction with this
discussion.
RESULTS OF OPERATIONS
QUARTER ENDED JUNE 30, 1997 COMPARED TO QUARTER ENDED JUNE 30, 1996
Net sales increased to $3,981,678 for the three months ended June 30,
1997 from $3,217,744 for the three months ended June 30, 1996, an increase of
$763,934 or 23.7%. This increase was principally attributable to increased sales
volume of the Company's products through continued market penetration,
acceptance of the Company's products and increased orders from established
accounts.
Gross profit increased to $1,536,314 for the three months ended June 30,
1997 from $1,267,176 for the three months ended June 30, 1996, an increase of
$269,138 or 21.2%. Gross profit decreased as a percentage of net sales to 38.6%
from 39.4%.
Selling and shipping expenses increased to $804,366 for the three months
ended June 30, 1997 from $582,634 for the three months ended June 30, 1996, an
increase of $221,732 or 38.1%. Selling and shipping expenses as a percentage of
net sales increased to 20.2% from 18.1%. The increase as a percentage of net
sales was primarily attributable to an increase in advertising and promotions to
facilitate the Company's continued and anticipated growth.
General and administrative expenses increased to $440,535 for the three
months ended June 30, 1997 from $432,578 for the three months ended June 30,
1996, an increase of $7,957, or 1.8%. General and administrative expenses as a
percentage of net sales decreased to 11.1% from 13.4%. The decrease as a
percentage of net sales was primarily attributable to a decrease in office
expenses and supplies for the three months ended June 30, 1997 versus the
comparable period in 1996.
Financial expenses increased to $94,043 for the three months ended June
30, 1997 from $64,896 for the three months ended June 30, 1996, an increase of
$29,147, or 44.9%. Of the total financial expenses, interest expense increased
to $24,468 for the three months ended June 30, 1997 from $130 for the three
months ended June 30, 1996. Such increase was attributable to the increase in
the Company's net borrowings for the three months ended June 30, 1997 versus the
comparable period in 1996.
Operating income increased to $197,370 for the three months ended June
30, 1997 from $187,068 for the three months ended June 30, 1996, a increase of
$10,302, or 5.5% for the reasons stated in the preceding paragraphs. Operating
income as a percentage of net sales was 5.0% for the three months ended June 30,
1997 as compared to 5.8% for the three months ended June 30, 1996.
-8-
<PAGE>
The Company incurred a tax provision of $85,949 for the three months
ended June 30, 1997 as compared to $33,502 for the three months ended June 30,
1996, an increase of $52,447. At June 30, 1996 the Company was able to utilize
$31,000 of its net operating loss carryforward to offset taxable income,
compared to June 30, 1997 when the Company had no net operating loss
carryforward available.
The Company had net income of $114,649 for the three months ended June
30, 1997 as compared to $166,805 for the three months ended June 30, 1996, a
decrease of $52,156, or 31.3% for the reasons stated in the preceding
paragraphs.
SIX MONTHS JUNE 30, 1997 COMPARED TO SIX MONTHS ENDED JUNE 30, 1996
Net sales increased to $8,002,699 for the six months ended June 30, 1997
from $7,164,593 for the six months ended June 30, 1996, an increase of $838,106,
or 11.7%. This increase was principally attributable to increased sales volume
of the Company's products through continued market penetration, acceptance of
the Company's products and increased orders from established accounts.
Gross profit increased to $3,160,034 for the six months ended June 30,
1997 from $2,785,349 for the six months ended June 30, 1996, an increase of
$374,685, or 13.5%. Gross profit increased as a percentage of net sales to 39.5%
from 38.9%. The increase as a percentage of net sales was primarily due to the
Company's ability to obtain projected sales prices on its products.
Selling and shipping expenses increased to $1,583,992 for the six months
ended June 30, 1997 from $1,330,689 for the six months ended June 30, 1996, an
increase of $253,303, or 19%. Selling and shipping expenses as a percentage of
net sales increased to 19.8% from 18.6%. The increase as a percentage of net
sales was primarily attributable to an increase in advertising and promotions to
facilitate the Company's continued and anticipated growth.
General and administrative expenses increased to $938,786 for the six
months ended June 30, 1997 from $820,628 for the six months ended June 30, 1996,
an increase of $118,158, or 14.4%. General and administrative expenses as a
percentage of net sales increased to 11.7% from 11.5%. The increase as a
percentage of net sales was primarily attributable to an increase in temporary
employment services and depreciation expense for the six months ended June 30,
1997 versus the comparable period in 1996.
Financial expenses increased to $180,777 for the six months ended June
30, 1997 from $144,075 for the six months ended June 30, 1996, an increase of
$36,702, or 25.5%. Of the total financial expenses, interest expense increased
to $40,180 for the six months ended June 30, 1997 from $7,558 for the six months
ended June 30, 1996. Such increase was attributable to the increase in the
Company's net borrowings for the six months ended June 30, 1997 versus the
comparable period in 1996.
Operating income decreased to $456,479 for the six months ended June 30,
1997 from $489,957 for the six months ended June 30, 1996, a decrease of
$33,478, or 6.8% for the reasons stated in the preceding paragraphs. Operating
income as a percentage of net sales was 5.7% for the six months ended June 30,
1997 as compared to 6.8% for the six months ended June 30, 1996.
The Company incurred a tax provision of $195,868 for the six months
ended June 30, 1997 as compared to $110,033 for the six months ended June 30,
1996, an increase of $85,835, or 78%. At June 30, 1996 the Company was able to
utilize $338,000 of its net operating loss carryforward to offset taxable
income, compared to June 30, 1997 when the Company had no net operating loss
carryforward available.
The Company had net income of $263,839 for the six months ended June 30,
1997 as compared to $397,307 for the six months ended June 30, 1996, a decrease
of $133,468, or 33.6% for the reasons stated in the preceding paragraphs.
-9-
<PAGE>
LIQUIDITY AND CAPITAL RESOURCES
On May 4, 1995, the Company completed an initial public offering of
640,000 shares of Common Stock at $6.25 per share. Proceeds to the Company,
after deducting initial public offering costs of $319,180 were $3,680,820. Upon
completion of the offering, the Company applied $3,600,000 of the net proceeds
towards its loan balance under the credit agreement with Century Business Credit
Corporation (the "Century Agreement"); the balance was applied to general
working capital.
Operating activities provided positive cash flow for the six months
ended June 30, 1997 and 1996. This was primarily attributable to the favorable
operating results achieved in both periods. The net cash provided by operating
activities was $109,904 for the six months ended June 30, 1997 compared to
$142,000 for the six months ended June 30, 1996. The decrease was primarily
attributable to the decrease in net income for the six months ended June 30,
1997 compared to the six months ended June 30, 1996. Net cash used for investing
activities for the six months ended June 30, 1997 was $133,757 compared to
$87,230 for the six months ended June 30, 1996. This was attributable to the
increase in acquisition of property and equipment. Net cash provided by (used
for) financing activities was $70,899 for the six months ended June 30, 1997
compared to ($4,713) for the six months ended June 30, 1996. The increase was
primarily attributable to proceeds from the exercise of stock options.
During the six months ended June 30, 1997, the Company's primary need
for funds was to finance working capital for the anticipated growth in net sales
of the Company's products. The Company has relied primarily upon cash flow from
operations and advances drawn against factored receivables to finance its
operations and expansion. At June 30, 1997, working capital was $5,062,787
compared to $5,054,997 at June 30, 1996 an increase of $7,790.
Due from factor represents the amount owed to the Company for factored
receivables less the amount of outstanding advances made by Century to the
Company under the Century Agreement. At June 30, 1997 due from factor was
$1,478,998 as compared to $3,243,668 at June 30, 1996. Due to a revised
replenishment program, stocking for a new product line, and an increase in
booked and anticipated orders, the Company's inventory increased to $3,975,679
at June 30, 1997 as compared to $1,813,307 at June 30, 1996.
Management anticipates it will retain a net receivable position under
the Century Agreement, although no assurance to that effect can be given.
Positive cash flow, if it occurs, will provide for a further reduction in
advances, and excess working capital will be sufficient to fund the Company's
anticipated growth through 1997.
-10-
<PAGE>
PART II. OTHER INFORMATION
Item 2. Changes in Securities
The following unregistered securities were issued by the Company during the six
months ended June 30,1997:
<TABLE>
<CAPTION>
Date of Sale Description of Number of Stock Exercise Purchaser
/Issuance Securities Issued Options Exercised Price Per Share or Class
--------- ----------------- ----------------- --------------- --------
<S> <C> <C> <C> <C>
April 17,1997 Common Stock 6,000 $.375 Nonaffiliated
Private Investor
April 23,1997 Common Stock 11,088 $.85-6.25 Director
</TABLE>
The issuance of these securities are claimed to be exempt from registration
pursuant to section 4(2) of the Securities Act of 1933, as amended, as
transactions by an issuer not involving a public offering. There were no
underwriting discounts or commissions paid in connection with the issuance of
any of these securities.
Item 4. Submission of Matters to a Vote of Security Holders.
On June 12, 1997, the Company held its Annual Meeting of stockholders,
whereby the stockholders elected Directors and approved a proposal to ratify the
appointment of Berenson & Company, LLP as the Company's independent auditors for
the fiscal year ending December 31, 1997. The vote on such matters was as
follows:
1. ELECTION OF DIRECTORS:
For Against
--- -------
George Horowitz 2,706,388 5,280
Rita Cinque 2,706,388 5,280
James Anderson 2,706,388 5,280
Edward Epstein 2,706,388 5,280
Donald Horowitz 2,706,388 5,280
Angelo Giusti 2,706,388 5,280
Larry Kring 2,705,888 5,780
2. RATIFICATION OF APPOINTMENT OF AUDITORS: To ratify the appointment of
Berenson & Company, LLP as the Company's auditors for the fiscal year ending
December 31,1997.
For Against Abstain
--- ------- -------
2,705,488 5,380 800
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit 27 - Financial Data Schedule
(b) Reports on Form 8-K
-11-
<PAGE>
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.
ACTIVE APPAREL GROUP, INC.
Date: August 13, 1997 By: /s/ George Q Horowitz
------------------------------
George Q Horowitz
Chief Executive Officer, President,
Treasurer, and Director
Signing on behalf of the
registrant and as Chief
Financial Officer
-12-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Company's Form 10-QSB for the quarter ended June 30, 1997 and is qualified
in its entirety by reference to such Financial Statements and Notes, thereto.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> APR-01-1997
<PERIOD-END> JUN-30-1997
<CASH> 210,287
<SECURITIES> 0
<RECEIVABLES> 1,478,998
<ALLOWANCES> 0
<INVENTORY> 3,975,679
<CURRENT-ASSETS> 6,036,961
<PP&E> 538,504
<DEPRECIATION> 168,509
<TOTAL-ASSETS> 7,001,833
<CURRENT-LIABILITIES> 974,174
<BONDS> 0
0
0
<COMMON> 5,283
<OTHER-SE> 1,000
<TOTAL-LIABILITY-AND-EQUITY> 7,001,833
<SALES> 3,981,678
<TOTAL-REVENUES> 3,981,678
<CGS> 2,445,364
<TOTAL-COSTS> 2,445,364
<OTHER-EXPENSES> 1,338,944
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 24,468
<INCOME-PRETAX> 200,598
<INCOME-TAX> 85,949
<INCOME-CONTINUING> 200,598
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 114,649
<EPS-PRIMARY> 0.04
<EPS-DILUTED> 0.04
</TABLE>
