<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
[ X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the quarterly period ended MARCH 31, 1997
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
EXCHANGE ACT OF 1934.
For the transition period from _______________ to _______________
Commission File Number: 000-26222
ONTRAK SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
DELAWARE 77-0074302
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
1010 RINCON CIRCLE, SAN JOSE, CA 95131
(Address of principal executive offices) (Zip code)
(408) 577-1010
(Registrant's telephone number, including area code)
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 Registrant's classes
of common stock, as of the latest practicable date.
CLASS SHARES OUTSTANDING AS OF APRIL 15, 1997
COMMON STOCK 7,740,912
<PAGE>
ONTRAK SYSTEMS, INC.
INDEX
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements PAGE NO.
Condensed Consolidated Statement of Operations for the
Quarters and Nine Months Ended March 31, 1997 and 1996 ........ 3
Condensed Consolidated Balance Sheet as of March 31, 1997
and June 30, 1996 ............................................. 4
Condensed Consolidated Statement of Cash Flows for the
Nine Months Ended March 31, 1997 and 1996 ..................... 5
Notes to Condensed Consolidated Financial Statements ............ 6
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations ...................... 8
PART II. OTHER INFORMATION
Item 1. Legal Proceedings .......................................... 11
Item 4. Submission of Matters to a Vote of Security-Holders......... 11
Item 6. Exhibits and Reports on Form 8-K ........................... 11
SIGNATURES .......................................................... 12
2
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
ONTRAK SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(in thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
Quarter Ended Nine Months Ended
March 31, March 31,
--------------------- ----------------------
1997 1996 1997 1996
-------- -------- -------- --------
<S> <C> <C> <C> <C>
Net revenue $ 17,664 $ 15,300 $ 50,859 $ 38,995
Cost of revenue 8,581 7,283 24,427 18,519
-------- -------- -------- --------
Gross profit 9,083 8,017 26,432 20,476
-------- -------- -------- --------
Operating expenses:
Research, development and engineering 5,597 3,713 15,265 9,739
Selling, general and administrative 2,977 2,701 8,541 6,701
-------- -------- -------- --------
Total operating expenses 8,574 6,414 23,806 16,440
-------- -------- -------- --------
Income from operations 509 1,603 2,626 4,036
Interest and other income, net 319 368 1,072 1,080
-------- -------- -------- --------
Income before provision for income taxes 828 1,971 3,698 5,116
Provision for income taxes 274 690 1,222 1,797
-------- -------- -------- --------
Net income $ 554 $ 1,281 $ 2,476 $ 3,319
-------- -------- -------- --------
-------- -------- -------- --------
Net income per share $ 0.07 $ 0.16 $ 0.31 $ 0.41
-------- -------- -------- --------
-------- -------- -------- --------
Weighted average common and
common equivalent shares 8,414 8,153 8,050 8,134
-------- -------- -------- --------
-------- -------- -------- --------
</TABLE>
The accompanying notes are an integral part
of these condensed consolidated financial statements
3
<PAGE>
ONTRAK SYSTEMS, INC.
CONDENSED CONSOLIDATED BALANCE SHEET
(in thousands, except per share data)
(unaudited)
<TABLE>
<CAPTION>
March 31, June 30,
1997 1996
--------- --------
<S> <C> <C>
ASSETS
Current assets:
Cash and cash equivalents $ 14,880 $ 24,217
Short-term investments 17,518 12,372
Accounts receivable, net 14,101 8,918
Inventory 8,570 6,892
Prepaid expenses and other assets 2,305 2,440
--------- --------
Total current assets 57,374 54,839
Property and equipment, net 10,219 7,293
--------- --------
$ 67,593 $ 62,132
--------- --------
--------- --------
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Current portion of long-term obligations $ 283 $ 283
Accounts payable 4,113 3,124
Accrued liabilities 6,917 5,462
--------- --------
Total current liabilities 11,313 8,869
--------- --------
Long-term obligations, less current portion 965 1,173
--------- --------
Stockholders' equity:
Common stock, $.0001 par value, 30,000 shares
authorized; 7,738 and 7,518 shares issued
and outstanding 1 1
Capital in excess of par value 47,414 46,665
Retained earnings 7,900 5,424
--------- --------
Total stockholders' equity 55,315 52,090
--------- --------
$ 67,593 $ 62,132
--------- --------
--------- --------
</TABLE>
The accompanying notes are an integral part
of these condensed consolidated financial statements
4
<PAGE>
ONTRAK SYSTEMS, INC.
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Increase (Decrease) in Cash and Cash Equivalents
(in thousands, unaudited)
<TABLE>
<CAPTION>
NINE MONTHS ENDED MARCH 31,
---------------------------
1997 1996
--------- --------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 2,476 $ 3,319
Adjustments to reconcile net income to
net cash used for operating activities:
Depreciation and amortization 1,954 935
Changes in assets and liabilities:
Accounts receivable (5,248) (5,685)
Inventory (1,817) (2,927)
Prepaid expenses and other assets 51 345
Accounts payable 989 514
Accrued liabilities 1,455 1,490
--------- --------
Net cash used for operating activities (140) (2,009)
--------- --------
Cash flows from investing activities:
Acquisitions of property and equipment (4,880) (4,854)
Net purchases of short-term investments (5,146) ----
--------- --------
Net cash used for investing activities (10,026) (4,854)
--------- --------
Cash flows from financing activities:
Borrowings under long-term obligations ---- 1,170
Repayments under long-term obligations (208) (1,394)
Net proceeds from issuance of
Common Stock in initial public offering ---- 41,404
Proceeds from issuance of Common Stock 1,037 376
Redemption of Mandatorily Redeemable
Preferred Stock ---- (3,450)
--------- --------
Net cash provided by financing activities 829 38,106
--------- --------
Net increase (decrease) in cash and cash equivalents (9,337) 31,243
Cash and cash equivalents:
Beginning of period 24,217 1,767
--------- --------
End of period $ 14,880 $ 33,010
--------- --------
--------- --------
Supplemental disclosure of non-cash investing
and financing activities:
Conversion of Mandatorily Redeemable Preferred
Stock into Common Stock $ ---- $ 3,072
--------- --------
--------- --------
Book value of assets exchanged for Common Stock $ 288 $ ----
--------- --------
--------- --------
</TABLE>
The accompanying notes are an integral part
of these condensed consolidated financial statements
5
<PAGE>
ONTRAK SYSTEMS, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)
(1) BASIS OF PRESENTATION
The unaudited condensed consolidated financial information of OnTrak Systems,
Inc. (the "Company") furnished herein reflects all adjustments, consisting
only of normal recurring adjustments, which in the opinion of management are
necessary to fairly state the consolidated financial position of the Company
and its subsidiaries, the results of their operations, and their cash flows
for the periods presented. These financial statements do not contain all of
the information and footnotes required by generally accepted accounting
principles for complete financial statements. This Quarterly Report on Form
10-Q should be read in conjunction with the consolidated financial statements
and notes thereto included in the Company's Annual Report on Form 10-K for
the year ended June 30, 1996. The consolidated results of operations for the
quarter and nine months ended March 31, 1997 are not necessarily indicative
of the results to be expected for any subsequent quarter or for the entire
year ending June 30, 1997.
(2) COMPONENTS OF INVENTORY
MAR. 31, 1997 JUNE 30, 1996
------------- -------------
Inventory: (in thousands)
Raw materials $ 3,767 $ 3,338
Work-in-process 4,445 3,481
Finished goods 358 73
---------- ----------
$ 8,570 $ 6,892
---------- ----------
---------- ----------
(3) SPLIT OFF OF TELEPARTS SUBSIDIARY
In September 1996, the Company distributed all of the shares of Teleparts
International, Inc., its former wholly-owned subsidiary, to the Company's
former CEO in exchange for 30,000 shares of the Company's common stock. The
book value of the net assets of Teleparts at the date of distribution was
approximately $288,000 and the fair value of the 30,000 shares of the
Company's common stock was approximately $420,000. Because of the
significant ownership in the Company by the former CEO (approximately 9%,
prior to the redemption) the transaction was recorded at the book value of
the assets exchanged and no gain was recorded.
(4) DELAWARE REINCORPORATION
In November 1996, the Company completed the change in its state of
incorporation from California to Delaware by merging into its wholly-owned
subsidiary, OnTrak Systems, Inc., a Delaware corporation ("OnTrak Delaware").
OnTrak Delaware continues to operate the business of the Company under the
name OnTrak Systems, Inc. The reincorporation was approved by the Company's
shareholders at the Annual Meeting of Shareholders held on November 21, 1996.
As a result of the reincorporation, each outstanding share of the Company's
Common Stock was automatically converted into one share of OnTrak Delaware
Common Stock, $.0001 par value.
(5) MERGER AGREEMENT
In March 1997, the Company announced that it had signed a definitive
agreement to be acquired by Lam Research Corporation in a transaction
expected to be a tax free reorganization and to constitute a pooling of
interests for accounting purposes, in which each share of the Company's
common stock will be exchanged for 0.83 shares of Lam Research Corporation
common stock, subject to potential adjustment under certain conditions. The
transaction is scheduled to close mid-year.
6
<PAGE>
(6) NET INCOME PER SHARE
Net income per common and common equivalent share for the quarter and nine
months ended March 31, 1996 was determined using the treasury stock method.
Under the treasury stock method, earnings per share is computed by dividing
net income by the weighted average number of common and common equivalent
shares outstanding during the period, including the assumed net shares
issuable upon exercise of dilutive stock options.
Net income per common and common equivalent share for the quarter and nine
months ended March 31, 1997 was determined using the modified treasury stock
method. Under the modified treasury stock method, all stock options are
assumed exercised whether dilutive or not, and the proceeds from the assumed
exercise are applied in steps. First, stock is assumed to be repurchased up
to a maximum of 20% of the actual outstanding shares. Any remaining proceeds
are assumed to be used to reduce debt, and then to acquire U.S. Government
securities. For purposes of this calculation, net income is adjusted by the
after tax interest effect related to such assumed transactions. The result
of the two step approach is aggregated and, if dilutive, enters into the
earnings per share calculation. The modified treasury stock method can
result in different earnings per share than those calculated using the
treasury stock method.
The calculations of earnings per share for the quarter and nine months ended
March 31, 1997 are as follows:
<TABLE>
<CAPTION>
QUARTER NINE MONTHS
ENDED ENDED
MAR. 31, 1997 MAR. 31, 1997
------------- -------------
<S> <C> <C>
CALCULATION OF NUMBER OF SHARES:
Actual outstanding shares at March 31, 1997 7,738 7,738
----- -----
----- -----
Assume exercise of all stock options 2,097 2,031
Proceeds used for assumed repurchase of up to
20% of actual outstanding shares at March 31, 1997 (1,307) (1,548)
Add average shares outstanding during the period 7,624 7,567
----- -----
Pro forma shares for EPS calculation 8,414 8,050
----- -----
----- -----
CALCULATION OF PRO FORMA NET INCOME FOR PERIOD:
Net income as reported for period 554 2,476
After-tax interest adjustment related to assumed
option exercises --- ---
----- -----
Pro forma net income for EPS calculation 554 2,476
----- -----
----- -----
CALCULATION OF EPS:
Pro forma net income divided by pro forma shares $ 0.07 $ 0.31
----- -----
----- -----
</TABLE>
7
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
All statements included in this discussion which are not statements of
historical fact are, and are hereby identified as, "forward-looking
statements" for purposes of the safe harbor provided by Section 21E of the
Securities Exchange Act of 1934, as amended. These forward-looking
statements are subject to a number of risks and uncertainties that could
cause the actual results to differ materially from the statements made,
including, but not limited to, the matters discussed herein and under "Item 7
- - Future Performance and Risk Factors" in the Company's Annual Report on Form
10-K for the year ended June 30, 1996. These forward-looking statements
represent the Company's judgment as of the date of the filing of this 10-Q
report. The Company disclaims, however, any intent or obligation to update
these forward-looking statements.
OVERVIEW
The Company was incorporated in 1985 to provide third party sales of spare
parts for certain silicon wafer processing and semiconductor manufacturing
equipment. In 1990, the Company changed its focus and began developing a
wafer cleaning system. Sales of the Company's cleaning systems have
increased in part, because new wafer processing requirements, such as CMP,
have increased the need for improved cleaning processes. As of March 31,
1997, the Company has shipped over 400 cleaning systems to customers
worldwide.
The Company has been undergoing a period of growth. The Company has
increased its operations to support increased revenues, including the hiring
of additional personnel, and has made substantial investments in research,
development and engineering to support product development. The Company's
expansion has resulted in significantly higher operating expenses and the
Company expects that its operating expenses will continue to increase
significantly.
The continuing development of the Company's CMP polishing system, the Aurora,
has resulted in a significant increase in research, development and
engineering expenses and a corresponding decrease in operating margins. There
can be no assurance that the Company will not experience difficulties or
delays in developing the polishing system, that such efforts will be
successful or that the polishing system will satisfy customer requirements or
achieve market acceptance.
The Company's operating results have varied significantly, particularly on a
quarterly basis, as a result of a number of factors, including general
economic conditions affecting industry demand for semiconductor and
semiconductor equipment products; the timing and market acceptance of new
product introductions by the Company and its competitors; and the timing of
significant orders from and shipments to large customers. The Company's
operating results may fluctuate in the future as a result of these and other
factors, including continued demand for the Company's products, the Company's
success in developing and introducing new products, its product and customer
mix, the level of competition which it experiences, and its success in
completing development of and marketing its CMP polishing system under
development. The Company derives a substantial portion of its revenues from
the sale of a relatively small number of systems which range in purchase
price from approximately $150,000 to $600,000. As a result, a small
reduction in the number of systems shipped in a quarter could have a material
adverse effect on the Company's revenues and results of operations for that
quarter.
The Company's gross margins have been and will continue to be affected by a
variety of factors, including the mix and average selling prices of systems,
the mix of customers, the costs associated with new system introductions and
enhancements, and the customization of systems. In addition, sales to
international distributors in Europe and Japan are at discounted prices which
reduce gross margins. Gross margins for initial shipments of new products
are typically lower than those for mature products until volume manufacturing
is achieved due to the inefficiencies associated with the start-up of
manufacturing operations.
The Company's international sales are denominated in U.S. dollars, and an
increase or decrease in the value of the U.S. dollar relative to foreign
currencies could make the Company's products less or more price competitive
in those markets and therefore affect sales to international customers.
During the first nine months of fiscal 1997, approximately 49% of the
Company's revenues were attributable to sales for installation in
semiconductor fabrication facilities outside the United States. During
fiscal 1996 and 1995, approximately 32% and 27%, respectively, of the
Company's revenues were attributable to sales for installation in
semiconductor fabrication facilities outside the United States.
8
<PAGE>
The market price of the Company's Common Stock has fluctuated since its
initial public offering in July 1995 and may fluctuate in the future in
response to a variety of factors, including; quarter to quarter variations in
operating results; announcements of developments related to the Company's
business; fluctuations in the Company's order levels; general conditions in
the semiconductor industry or the worldwide economy; announcements of
technological innovations; new products or product enhancements by the
Company or its competitors; developments relating to patents or other
intellectual property rights or disputes; and developments in the Company's
relationships with its customers, distributors and suppliers. In addition,
in recent years the stock market in general, and the market for shares of
small capitalization stocks in particular, has experienced extreme price
fluctuations which have often not been solely related to the operating
performance of affected companies. Such fluctuations could adversely affect
the market price of the Company's Common Stock in the future.
RESULTS OF OPERATIONS
NET REVENUES. Net revenues are derived primarily from system sales, and to a
lesser extent, sales of spare parts and service. Net revenues for the
quarter ended March 31, 1997 were $17.7 million, an increase of 15% as
compared to net revenues of $15.3 million for the prior year's comparable
period. Net revenues for the nine months ended March 31, 1997 were $50.9
million, an increase of 30% as compared to net revenues of $39.0 million for
the prior year's comparable period. Both the current quarter and
year-to-date increases were primarily due to increased unit sales of the
Company's post-CMP cleaning systems. System shipments for the quarter and
nine month period ended March 31, 1997 increased by 5% and 17% respectively,
over the prior year's comparable periods. Higher average selling prices in
both periods of the current year, as compared to each period in the prior
year, also contributed to the increased revenues. The increases in average
selling prices were attributable to a shift in the product mix toward systems
with higher average selling prices, offset partially by the effect of an
increased level of distributor sales, which generally have lower than average
selling prices.
International sales accounted for 35% of net revenues in the quarter ended
March 31, 1997, as compared to 32% for the prior year's comparable period.
For the first nine months of fiscal 1997, international sales accounted for
49% of net revenues, as compared to 32% for the prior year's comparable
period. Both the current quarter and year-to-date increases in the
percentage of international sales were attributable to increased system
shipments to customers in Europe and the Pacific Rim, compared to total
system shipments.
Sales to customers in Europe increased to $2.2 million during the quarter
ended March 31, 1997, as compared to $1.1 million for the prior year's
comparable period. For the nine month period ended March 31, 1997, sales to
customers in Europe increased to $12.4 million, as compared to $6.7 million
for the prior year's comparable period. Sales to customers in the Pacific Rim
increased to $4.1 million during the quarter ended March 31, 1997, as
compared to $3.7 million for the prior year's comparable period. For the
nine month period ended March 31, 1997, sales to customers in the Pacific Rim
increased to $12.3 million, as compared to $5.9 million for the prior year's
comparable period. It is expected that international sales will continue to
represent an increased percentage of net revenues during the current year as
compared to fiscal 1996.
GROSS MARGIN. Gross margin was 51% for the quarter ended March 31, 1997, as
compared to 52% for the prior year's comparable period. For the nine months
ended March 31, 1997, gross margin was 52%, compared to 53% for the prior
year's comparable period. The slight decrease in both periods was
attributable to higher distributor discounts on the increased international
shipments to Europe and Japan.
RESEARCH, DEVELOPMENT, AND ENGINEERING. Research, development, and
engineering expenses increased to $5.6 million, or 32% of net revenues, for
the quarter ended March 31, 1997, from $3.7 million, or 24% of net revenues,
for the prior year's comparable period. For the nine months ended March 31,
1997, research, development, and engineering expenses increased to $15.3
million, or 30% of net revenues, from $9.7 million, or 25% of net revenues,
for the prior year's comparable period. The increases in both the current
quarter and the year-to-date are attributable to the Company's continued
development of a CMP polishing system. It is anticipated that research,
development, and engineering expenses will remain at a relatively high
percentage of revenues until the polishing system is in commercial production.
SELLING, GENERAL, AND ADMINISTRATIVE. Selling, general, and administrative
expenses increased to $3.0 million, or 17% of net revenues, for the quarter
ended March 31, 1997, from $2.7 million, or 18% of net revenues, for the
prior year's comparable period. For the nine months ended March 31, 1997,
selling, general, and administrative expenses increased to $8.5 million, or
17% of net revenues, from $6.7 million, or 17% of net revenues, for the prior
year's comparable period. The current quarter and year-to-date increases in
absolute dollars are attributable to increased selling and marketing
activities as the Company expands its sales and marketing organization.
9
<PAGE>
INCOME TAXES. The Company's effective tax rate for the quarter and nine
months ended March 31, 1997 was 33%, as compared to 35% for the comparable
periods in the prior year. The current quarter and year-to-date decreases
are attributable to the reinstatement of the federal research and development
tax credit.
LIQUIDITY AND CAPITAL RESOURCES
During the nine months ended March 31, 1997, cash and cash equivalents
decreased by $9.3 million, from $24.2 million at June 30, 1996 to $14.9
million at March 31, 1997. This decrease consisted of $10.0 million used for
investing activities and $0.1 million used for operating activities, offset
by $0.8 million provided by investing activities. Cash used for investing
activities consisted of $5.1 million used to purchase short-term investments
and $4.9 million used to purchase fixed assets.
Changes in operating assets and liabilities consisted primarily of increases
of $5.2 million in accounts receivable and $1.8 million in inventory, which
reflects the Company's increased sales levels and manufacturing activities.
In addition, the increase in accounts receivable is also attributable to the
increased percentage of international sales, which are typically subject to
longer payment terms compared to domestic sales. The Company expects future
inventory levels to fluctuate with anticipated sales levels and believes that
because of the relatively long manufacturing cycle of its systems, its
investment in inventory will continue to represent a significant portion of
working capital. As a result of such investment in inventories, the Company
may be subject to an increased risk of inventory obsolescence, which could
have a material adverse effect on the Company's operating results.
At March 31, 1997, the Company had working capital of $46.1 million, with its
primary source of liquidity provided by $32.4 million in cash and short-term
investments. In addition, the Company has a $10.0 million working capital
line of credit agreement which expires in November 1997. The Company has no
outstanding borrowings under the line of credit. The Company believes that
its existing cash and short-term investments, anticipated cash flow from
operations, and funds available under the line of credit agreement will be
sufficient to meet the Company's cash requirements during the next twelve
months. However, after that period, depending upon its rate of growth and
profitability, the Company may require additional equity or debt financing to
meet its working capital and fixed asset requirements. There can be no
assurance that additional financing will be available when required or, if
available, will be on terms satisfactory to the Company.
10
<PAGE>
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS.
None.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY-HOLDERS.
None.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
Exhibit 27 - Financial Data Schedule for the nine months ended
March 31, 1997, submitted to the Securities and Exchange
Commission in electronic format.
(b) Reports on Form 8-K:
Report dated April 1, 1997 - to announce the Company's merger
agreement with Lam Research Corporation.
11
<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.
ONTRAK SYSTEMS, INC.
Date: April 30, 1997 By: /s/ Patrick C. O'Connor
----------------------------
Patrick C. O'Connor
Title: Vice President-Finance and
Chief Financial Officer
(Principal Financial and
Accounting Officer)
12
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS OF ONTRAK SYSTEMS, INC. FOR THE NINE
MONTHS ENDED MARCH 31, 1997, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000946732
<NAME> ONTRAK SYSTEMS, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> JUN-30-1996
<PERIOD-START> JUL-01-1996
<PERIOD-END> MAR-31-1997
<CASH> 14,880
<SECURITIES> 17,518
<RECEIVABLES> 14,501
<ALLOWANCES> 400
<INVENTORY> 8,570
<CURRENT-ASSETS> 57,374
<PP&E> 13,951
<DEPRECIATION> 3,732
<TOTAL-ASSETS> 67,593
<CURRENT-LIABILITIES> 11,313
<BONDS> 0
0
0
<COMMON> 47,415
<OTHER-SE> 7,900
<TOTAL-LIABILITY-AND-EQUITY> 67,593
<SALES> 50,859
<TOTAL-REVENUES> 50,859
<CGS> 24,427
<TOTAL-COSTS> 48,233
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 90
<INCOME-PRETAX> 3,698
<INCOME-TAX> 1,222
<INCOME-CONTINUING> 2,476
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,476
<EPS-PRIMARY> 0.31
<EPS-DILUTED> 0
</TABLE>
