<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 or 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended September 30, 1997 Commission File No. 1-6736
STARRETT CORPORATION
(Exact Name of Registrant as specified in its charter)
NEW YORK 13-5411123
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
ONE PARK AVENUE, NEW YORK, NEW YORK 10016
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212)616-3200
NONE
(Former name, former address and former fiscal year, if changed
since last report)
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 |_|
Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of the close of the period covered by this report.
6,566,402 shares of common stock.
<PAGE> 2
STARRETT CORPORATION AND SUBSIDIARIES
TABLE OF CONTENTS
PAGE
----
Consolidated Financial Statements:
Statement of Consolidated Financial Position - September 30, 1997............3
Statement of Consolidated Financial Position - December 31, 1996.............4
Statements of Consolidated Operations - For the Nine Months
ended September 30, 1997 and 1996...........................................5
Statements of Consolidated Operations - For the Three Months
ended September 30, 1997 and 1996...........................................6
Statements of Consolidated Stockholders' Equity - September 30, 1997
and December 31, 1996.......................................................7
Statements of Consolidated Cash Flows - For the Nine Months
ended September 30, 1997 and 1996...........................................8
Notes to Consolidated Financial Statements...................................9
Management's Discussion of Financial Condition and
Results of Operations......................................................12
Signatures..................................................................15
Exhibit A - Computation of Primary Earnings per Share - For the
Nine Months ended September 30, 1997 and 1996...................16
Exhibit B - Computation of Primary Earnings per Share - For the
Three Months ended September 30, 1997 and 1996..................17
2
<PAGE> 3
STARRETT CORPORATION AND SUBSIDIARIES
STATEMENT OF CONSOLIDATED FINANCIAL POSITION
SEPTEMBER 30, 1997
(In Thousands)
(Unaudited)
<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Cash and Cash Equivalents ......................................... $ 2,216
Cash Restricted ................................................... 6,032
Receivables ....................................................... 54,547
Inventory of Real Estate .......................................... 106,413
Investments in Joint Ventures ..................................... 4,045
Property and Equipment-Net ........................................ 3,846
Other Assets ...................................................... 21,899
---------
Total ....................................................... $ 198,998
=========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Liabilities:
Payable Within One Year:
Accounts payable ................................................. $ 44,509
Current portion of long-term obligations ......................... 16,108
Accrued liabilities .............................................. 13,013
---------
Total Liabilities Payable Within One Year ................... 73,630
Deferred Income taxes ............................................. 9,512
Other Liabilities ................................................. 1,311
Long-Term Obligations ............................................. 56,078
---------
Total ....................................................... 140,531
---------
Commitments and Contingencies
Minority Interest ................................................. 2,157
---------
Stockholders' Equity
Common stock-par value, $1.00; authorized,
18,000 shares ................................................... 6,566
Capital in excess of par value ................................... 23,933
Retained earnings ................................................ 28,728
Pension liability adjustment ..................................... (1,327)
Shares held in treasury-at cost .................................. (1,590)
---------
Stockholders' Equity .............................................. 56,310
---------
Total ....................................................... $ 198,998
=========
</TABLE>
See Notes to Consolidated Financial Statements
3
<PAGE> 4
STARRETT CORPORATION AND SUBSIDIARIES
STATEMENT OF CONSOLIDATED FINANCIAL POSITION
DECEMBER 31, 1996
(In Thousands)
<TABLE>
<CAPTION>
<S> <C>
ASSETS:
Cash and Cash Equivalents ..................................... $ 8,662
Cash Restricted ............................................... 4,487
Receivables ................................................... 37,642
Inventory of Real Estate ...................................... 91,034
Investments in Joint Ventures ................................. 6,155
Property and Equipment-Net .................................... 3,925
Other Assets .................................................. 15,067
---------
Total .................................................... $ 166,972
=========
LIABILITIES AND STOCKHOLDERS' EQUITY:
Liabilities:
Payable Within One Year:
Accounts payable ............................................ $ 22,716
Current portion of long-term obligations .................... 9,126
Accrued liabilities ......................................... 14,565
---------
Total Liabilities Payable Within One Year ................ 46,407
Deferred Income Taxes ......................................... 8,942
Other Liabilities ............................................. 1,311
Long-Term Obligations ......................................... 53,030
---------
Total .................................................... 109,690
---------
Commitments and Contingencies
Minority Interest ............................................. 2,088
---------
Stockholders' Equity:
Common stock-par value, $1.00; authorized,
18,000 shares .............................................. 6,566
Capital in excess of par value .............................. 23,933
Retained earnings ........................................... 27,612
Pension liability adjustment ................................ (1,327)
Shares held in treasury-at cost ............................. (1,590)
---------
Stockholders' Equity .......................................... 55,194
---------
Total .................................................... $ 166,972
=========
</TABLE>
See Notes to Consolidated Financial Statements
4
<PAGE> 5
STARRETT CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED OPERATIONS
For The Nine Months Ended September 30, 1997 and 1996
(In Thousands Except Per Share Data)
(Unaudited)
<TABLE>
<CAPTION>
1997 1996
-------- --------
<S> <C> <C>
Revenues ........................................... $168,222 $106,367
Equity in Earnings of Joint Ventures ............... 925 2,501
-------- --------
Total Revenues ................................ 169,147 108,868
Construction Costs ................................. 121,402 60,607
-------- --------
Income from Construction Contracts and
Related Revenues .................................. 47,745 48,261
-------- --------
Expenses:
General and Administrative ........................ 28,478 23,498
Security Service Labor & Other Costs .............. 6,305 8,274
Selling ........................................... 4,398 4,081
Mortgage and Closing Costs ........................ 3,779 4,789
Interest .......................................... 431 289
-------- --------
Total ......................................... 43,391 40,931
-------- --------
Income before Income Taxes ......................... 4,354 7,330
Income Taxes ....................................... 2,062 3,284
-------- --------
Net Income ......................................... $ 2,292 $ 4,046
======== ========
Earnings per Common Share:
Net Income ......................................... $ .37 $ .65
======== ========
Weighted average number of shares .................. 6,261 6,261
======== ========
Cash Dividends per Share ........................... $ .1875 $ .1875
======== ========
</TABLE>
See Notes to Consolidated Financial Statements
5
<PAGE> 6
STARRETT CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED OPERATIONS
For The Three Months Ended September 30, 1997 and 1996
(In Thousands Except Per Share Data)
(Unaudited)
<TABLE>
<CAPTION>
1997 1996
-------- --------
<S> <C> <C>
Revenues ........................................... $74,328 $35,086
Equity in Earnings of Joint Ventures ............... 314 886
------- -------
Total Revenues ................................ 74,642 35,972
Construction Costs ................................. 57,102 19,839
------- -------
Income from Construction Contracts and
Related Revenues .................................. 17,540 16,133
Expenses:
General and Administrative ........................ 9,317 7,745
Security Service Labor & Other Costs .............. 2,023 2,663
Selling ........................................... 1,950 1,231
Mortgage and Closing Costs ........................ 1,274 1,581
Interest .......................................... 172 113
------- -------
Total ......................................... 14,736 13,333
------- -------
Income before Income Taxes ......................... 2,804 2,800
Income Taxes ....................................... 1,375 1,288
------- -------
Net Income ......................................... $ 1,429 $ 1,512
======= =======
Earnings per Common Share:
Net Income ......................................... $ .23 $ .25
======= =======
Weighted average number of shares .................. 6,261 6,261
======= =======
Cash Dividends per Share ........................... $ .0625 $ .0625
======= =======
</TABLE>
See Notes to Consolidated Financial Statements
6
<PAGE> 7
STARRETT CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED STOCKHOLDERS' EQUITY
(In Thousands Except Share Data)
(Unaudited)
<TABLE>
<CAPTION>
September 30, December 31,
1997 1996
------------- ------------
<S> <C> <C>
Common Stock - Par Value, $1.00; Authorized,
18,000,000 shares; Issued, 6,566,402 shares ....... $ 6,566 $ 6,566
Capital in Excess of Par Value ..................... 23,933 23,933
Retained Earnings .................................. 28,728 27,612
Pension Liability Adjustment ....................... (1,327) (1,327)
Less: Shares Held in Treasury - at cost; 1997
and 1996, 305,442 shares .................... (1,590) (1,590)
-------- --------
TOTAL STOCKHOLDERS' EQUITY ......................... $ 56,310 $ 55,194
======== ========
</TABLE>
See Notes to Consolidated Financial Statements
7
<PAGE> 8
STARRETT CORPORATION AND SUBSIDIARIES
STATEMENTS OF CONSOLIDATED CASH FLOWS
For The Nine Months Ended September 30, 1997 and 1996
(In Thousands)
(Unaudited)
<TABLE>
<CAPTION>
1997 1996
-------- --------
<S> <C> <C>
OPERATING ACTIVITIES:
Net income ........................................... $ 2,292 $ 4,046
Adjustments to reconcile net income to net cash
Used in operating activities:
Depreciation and amortization ...................... 1,948 1,757
Deferred income taxes .............................. 570 1,229
Equity in earnings of joint ventures ............... (925) (2,501)
Changes in operating assets and liabilities:
Cash Restricted ................................... (1,545)
Receivables ....................................... (16,905) (13,383)
Inventories ....................................... (15,379) (36,236)
Accounts payable .................................. 21,793 24,365
Other assets ...................................... (8,104) (4,798)
Accrued liabilities ............................... (1,552) (1,290)
-------- --------
Net cash used in operating activities ................ (17,807) (26,811)
-------- --------
INVESTING ACTIVITIES:
Investments in joint ventures ........................ (110) (1,401)
Distributions from joint ventures .................... 3,145 5,183
Distributions from partnerships - net ................ 4 83
Purchase of property and equipment ................... (601) (1,177)
-------- --------
Net cash provided by investing activities ............ 2,438 2,688
-------- --------
FINANCING ACTIVITIES:
Repayment of long term obligations ................... (26,408) (27,915)
Proceeds from long term obligations .................. 36,438 47,627
Proceeds from minority interest ...................... 69 1,885
Payment of cash dividends to common
stockholders ........................................ (1,176) (1,176)
-------- --------
Net cash provided by financing activities ............ 8,923 20,421
-------- --------
Net decrease in cash and cash equivalents ............ (6,446) (3,702)
Cash and cash equivalents beginning of period ........ 8,662 10,762
-------- --------
Cash and cash equivalents end of period .............. $ 2,216 $ 7,060
======== ========
</TABLE>
See Notes to Consolidated Financial Statements
8
<PAGE> 9
STARRETT CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
The accompanying consolidated financial statements of Starrett Corporation
and its subsidiaries have been prepared in accordance with generally accepted
accounting principles for interim financial information and with the
instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, they do
not include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of the
management, all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included. The consolidated financial
statements as of and for the nine months ended September 30, 1997 and 1996 are
unaudited and are subject to year-end audit and adjustments. The results of
operations for the interim periods are not necessarily indicative of the results
of operations for the fiscal year. For comparability purposes, certain 1996
amounts have been reclassified to conform with the 1997 classifications. For
further information, refer to the consolidated financial statements and
footnotes included thereto in the Company's Annual Report on Form 10-K for the
year ended December 31, 1996.
1. Legal Proceedings
On October 16, 1997, the Company entered into a Merger Agreement
with an entity (the "Purchaser") indirectly owned by affiliates of
Lawrence Ruben Company, Inc., Blackacre Capital Group, Amroc Investments
and Argent Ventures, under which the Purchaser has made a cash tender
offer for all of the outstanding shares of the Company's Common Stock as
at purchase price of $12.25 per share.
On October 22, 1997 a complaint captioned Starrett Acquisition,
Inc., v. Starrett Corporation et al., Index No. 605392/97, was filed in
the Supreme Court of the State of New York, County of New York. The
complaint was brought by Starrett Acquisition, Inc. ("SAI"), of which
Jacob Frydman is the President. SAI had been a party to an agreement and
plan of merger with the Company (such agreement as subsequently replaced,
the "Frydman Agreement") entered into in July 1997 providing for cash
consideration to the Company's shareholders of $12.25 per share. On
August 21, 1997, the Company notified Mr. Frydman that it had terminated
the Frydman Agreement as a consequence of his failure to deliver to the
Company a commitment for Mr. Frydman's financing of the transactions
contemplated by the Frydman Agreement reasonably acceptable to the
Company and his failure to deliver a $5,000,000 letter of credit required
to be delivered by him. The complaint filed by SAI alleges, among other
things, that the Company is in breach of certain contractual obligations
to the plaintiff arising out of the Frydman Agreement and subsequent
negotiations between the Company and Frydman. The complaint seeks
specific performance of the Company's alleged contractual obligations to
the plaintiff, injunctive relief with the respect to the tender offer
commenced by the Purchaser and unspecified damages. The Company believes
that the allegations contained in the complaint are without merit, and the
Company and Purchaser intend to vigorously contest the action.
On October 23, 1997, the court denied the plaintiff's motion for
a preliminary injunction. Counsel to Mr. Frydman has informed the Company
that he will not appeal the decision. Unspecified damages claims by Mr.
Frydman remain outstanding.
On November 10, 1997, an action captioned J. Arthur Johnson, et
al., v. Paul Milstein, et al. (Index No. 120975/97) was filed in the
Supreme Court of the State of New York, County of New York. The action
was filed by the named plaintiffs on behalf of themselves and a
purported class consisting of the other shareholders of the Company. The
Company, Purchaser, Purchaser's immediate parent, and certain current and
former directors of the Company are named as defendants. The plaintiffs
allege, among other things, that such directors breached their fiduciary
duty to the Company by (i) entering into the Merger Agreement with the
Purchaser and failing to pursue a bid for the Company at $12.50 per share
in violation of a duty to maximize shareholder value, and (ii) failing to
sufficiently disclose material information concerning the $12.50 per
share bid in the Company's Solicitation/Recommendation Statement on
Schedule 14D-9. The complaint seeks certification of the class, specific
performance of said directors' fiduciary duties to the plaintiffs
(including conducting a market check and considering all bona fide offers
for the Company), injunctive relief with respect to consummation of
transaction with Purchaser, rescission of such transaction if it is
consummated and rescissionary damages, rescission of certain allegedly
improper agreements entered into by certain of said directors in
connection with the Merger Agreement, costs and unspecified damages. The
Company believes that it and its directors fully complied with their
fiduciary duties and made a proper evaluation of all bids that were
received. The Company, Purchaser and its parent intend to vigorously
contest the action.
2. Recently Issued Accounting Pronouncements
The Financial Accounting Standards Board has recently issued
several new accounting pronouncements. Statement No. 128, "Earnings per
Share" establishes standards for computing and presenting earnings per
share, and is effective for financial statements for both interim and
annual periods ending after December 15, 1997. Statement No. 129,
"Disclosure of Information about Capital Structure" establishes standards
for disclosing information about an entity's capital structure, and is
effective for financial statements for periods ending December 15, 1997.
Statement No. 130, "Reporting Comprehensive Income" establishes standards
for reporting and display of comprehensive income and its components, and
is effective for fiscal years beginning after December 15, 1997.
Statement No. 131, "Disclosure about Segments of an Enterprise and
Related Information" establishes standards for the way that public
business enterprises report information about operating segments in
annual financial statements and requires that those enterprises report
selected information about operating segments in interim financial
reports issued to shareholders. It also establishes standards for related
disclosures about products and services, geographic areas, and major
customers, and is effective for financial statements for periods
beginning after December 15, 1997.
Management of the Company does not believe that these new
standards will have a material effect on the Company's reported operating
results, per share amounts, financial position or cash flows.
9
<PAGE> 10
MANAGEMENT'S DISCUSSION OF FINANCIAL CONDITION AND RESULTS OF
OPERATIONS COMPARISON OF NINE AND THREE MONTHS
ENDED SEPTEMBER 30, 1997 AND 1996
During the nine and three months ended September 30, 1997, the Company had
income before income taxes of $4,354,000 and $2,804,000 as compared to
$7,330,000 and $2,800,000 in 1996, and net income of $2,292,000 or $.37 a
share and $1,429,000 or $.23 a share as compared to $4,046,000 or $.65 a share
and $1,512,000 or $.25 a share for the similar periods in 1996.
The decrease in income for the nine months ended September 30, 1997 was
attributable to a decrease in income in Levitt, the Company's single family home
building subsidiary and Grenadier, the Company's management subsidiary.
Revenues for the nine months ended September 30, 1997 increased
$60,279,000 primarily due to an increase of $59,022,000 in HRH, the Company's
construction subsidiary, on construction performed as a general contractor.
HRH the Company's construction manager has increased the volume of its
work it performs as a general contractor as opposed to its construction
management activities and in accordance with accounting guidelines, reflects
construction volume on a gross basis in the Statement of Operations. Because
gross revenues from general contractor work include subcontractor costs incurred
by the Company, which are also included in construction costs, the increase in
gross revenues does not increase the operating income of the Company.
Levitt's Florida region is involved in several joint ventures. Equity in
earnings in these joint ventures decreased $1,576,000 during the nine months
ended September 30, 1997, as compared to the same period in 1996, primarily due
to a decrease in home deliveries in the joint venture communities which are
nearing completion. New joint venture activity will occur in the fourth quarter
of 1997 and thereafter as homes in these ventures are delivered.
Revenues for the three months ended September 30, 1997 increased
$39,242,000 primarily due to an increase of $28,715,000 in HRH on construction
performed as a general contractor and $10,800,000 in Levitt Corporation.
The increase in Levitt's revenues is due to an $8,600,000 increase in
house sales, a $2,700,000 increase in lot sales and a decrease of $572,000 in
equity in earnings of joint ventures. The increase in house sales was due to
higher home deliveries in the Company's Florida region having a significantly
higher average sale price. The increase in deliveries in the Florida region was
due to a new project opening combined with changes in product mix in existing
lines.
Levitt's backlog of homes contracted for sale at September 30, 1997 was
$124,803,000 compared to $105,723,000 at September 30, 1996. Included in
Levitt's sales backlog at
12
<PAGE> 11
September 30, 1997 and 1996 is $59,847,000 and $35,469,000, respectively, which
constitutes the full backlog from joint ventures in which Levitt has interests
ranging from 50% to 75%.
Grenadier reported a decrease in operating income which commenced in the
fourth quarter of 1996 and continues into 1997, due to the assumption by
Grenadier of certain administrative expenses previously reimbursed under a
management contract and the loss of a major security service contract in one of
its subsidiaries.
General and administrative expenses increased $4,980,000 and $1,572,000
for the nine and three months ended September 30, 1997 principally due to the
expansion of HRH into the interiors construction business, but also to the
expansion of operations in other segments of the Company's business.
Security service labor and other costs decreased $1,969,000 and $640,000
for the nine and three months ended September 30, 1997 as a result of the loss
of a major security contract and the reduction of security forces.
Interest expense increased $142,000 and $59,000 for the nine and three
months ended September 30, 1997 resulting from additional borrowings by Starrett
for various development and working capital requirements.
Financial Condition and Capital Resources
The Company meets its short-term financing needs with cash generated from
operations and funds available under several unsecured credit agreements. On
January 31, 1996, Levitt satisfied a $14,400,000 unsecured credit facility
through a $4,400,000 payment from working capital and a $10,000,000 payment from
an unsecured term loan. The new loan requires semi-annual principal payments of
$1,000,000 and $1,500,000 in July and January, respectively, through January
2000.
Homebuilding Operations
The Company generally meets its land acquisition, development and
construction needs through mortgage loans and unsecured revolving credit
facilities. During March 1996, the Company renewed and extended its $15,000,000
revolving unsecured credit agreement used to finance its Puerto Rico
homebuilding operation for an additional three years. In June 1997, the
$15,000,000 credit agreement was modified to increase the line of credit to
$23,000,000 with the additional $8,000,000 being secured with land mortgages in
Puerto Rico.
Mortgage Operations
During 1995 the Company entered into a credit agreement with a Puerto Rico
bank to provide an unsecured revolving line of credit of $3,000,000 to finance
the working capital needs of the expanding Puerto Rico mortgage banking
operation.
13
<PAGE> 12
Development/Construction Management
During 1995 the Company entered into a credit agreement with a New York
bank to provide a $3,000,000 unsecured line of credit to finance development,
construction and other operating activities. In March 1997 the credit agreement
was further modified to increase the line of credit to $8,000,000.
1997 Cash Flows
Net cash used in operating activities of $17,807,000 comprised an increase
in inventories of $15,379,000, an increase in receivables of $16,905,000 and a
net change in other operating assets and liabilities of $11,201,000, offset by
net income of $2,292,000, an increase in accounts payable of $21,793,000 and net
adjustments for non-cash items of $1,593,000.
The increase in inventories is due primarily to Levitt's continued
investment in two new development projects in the Florida region. The increase
in receivables and accounts payable reflects the increase in construction volume
on projects where the Company acts as a general contractor.
Net cash provided by investing activities of $2,438,000 comprised net
proceeds from joint ventures of $3,145,000 offset by other net investing
activities of $707,000.
Net cash provided by financing activities of $8,923,000 comprised net
proceeds from notes and mortgages payable of $10,030,000, and other items of
$69,000, offset by payments of cash dividends to common stockholders of
$1,176,000.
Seasonality
The timing of introducing Levitt's new projects to the market, weather
conditions in certain of Levitt's regions, and traditional periods of greater
customer activity have tended to create seasonal trends in Levitt's residential
home building activities. Historically, the number of homes delivered has been
greater in the second half of the calendar year.
Except as discussed above, management is not aware of any trends or
events, commitments or uncertainties that will impact liquidity in a material
way.
14
<PAGE> 13
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.
STARRETT CORPORATION
(Registrant)
/s/ Paul Milstein
-------------------------------------
Paul Milstein - Chairman
/s/ Lewis A. Weinfeld
-------------------------------------
Lewis A. Weinfeld - Executive Vice
President and Chief Financial Officer
(Principal Accounting Officer)
DATE: November 14, 1997
15
<PAGE> 14
EXHIBIT INDEX
Exhibit A - Computation of Primary Earnings per Share - For the
Nine Months ended September 30, 1997 and 1996...................16
Exhibit B - Computation of Primary Earnings per Share - For the
Three Months ended September 30, 1997 and 1996..................17
<PAGE> 1
EXHIBIT A
STARRETT CORPORATION AND SUBSIDIARIES
EXHIBIT SETTING FORTH THE COMPUTATION OF PRIMARY
EARNINGS PER SHARE INFORMATION
(In Thousands Except Per Share Amounts)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30,
1997 1996
------ -----
<S> <C> <C>
Weighted average number of shares outstanding
during the period .................................... 6,261 6,261
======= ======
Net Income ............................................ $ 2,292 $4,046
======= ======
Primary earnings per share:
Net Income ....................................... $ .37 $ .65
======= ======
</TABLE>
16
<PAGE> 1
EXHIBIT B
STARRETT CORPORATION AND SUBSIDIARIES
EXHIBIT SETTING FORTH THE COMPUTATION OF PRIMARY
EARNINGS PER SHARE INFORMATION
(In Thousands Except Per Share Amounts)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
SEPTEMBER 30,
1997 1996
------ -----
<S> <C> <C>
Weighted average number of shares outstanding
during the period .................................... 6,261 6,261
======= ======
Net Income ............................................ $ 1,429 $1,512
======= ======
Primary earnings per share:
Net Income ....................................... $ .23 $ .25
======= ======
</TABLE>
17
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-1-1997
<PERIOD-END> SEP-30-1997
<CASH> 2,216,000
<SECURITIES> 6,032,000
<RECEIVABLES> 55,023,000
<ALLOWANCES> 476,000
<INVENTORY> 106,413,000
<CURRENT-ASSETS> 155,954,000
<PP&E> 13,273,000
<DEPRECIATION> 9,427,000
<TOTAL-ASSETS> 198,998,000
<CURRENT-LIABILITIES> 73,630,000
<BONDS> 0
0
0
<COMMON> 6,566,000
<OTHER-SE> 49,744,000
<TOTAL-LIABILITY-AND-EQUITY> 198,998,000
<SALES> 169,147,000
<TOTAL-REVENUES> 169,147,000
<CGS> 121,402,000
<TOTAL-COSTS> 121,402,000
<OTHER-EXPENSES> 42,960,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 431,000
<INCOME-PRETAX> 4,354,000
<INCOME-TAX> 2,062,000
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,292,000
<EPS-PRIMARY> .37
<EPS-DILUTED> .37
</TABLE>
