<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 1999
--------------------------------------------------
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 0-3905
--------
TRANSMATION, INC.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
OHIO 16-0874418
- --------------------------------------------------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
10 Vantage Point Drive, Rochester, NY 14624
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 716-352-7777
------------------------------
- --------------------------------------------------------------------------------
Former name, former address and former fiscal year, if changed since last report
Indicate by check mark [X] 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 latest practicable date.
Class Number of Shares Outstanding Date
- ----- ---------------------------- ----
Common 5,871,230 September 30, 1999
TOTAL PAGES-16
<PAGE> 2
Part I
------
FINANCIAL INFORMATION
---------------------
Item 1. Financial Statements
- ----------------------------
TRANSMATION, INC.
CONSOLIDATED BALANCE SHEET
Unaudited
<TABLE>
<CAPTION>
September 30, March 31,
ASSETS: 1999 1999
------------ ------------
<S> <C> <C>
Current Assets:
Cash $ 178,454 $ 282,625
Accounts Receivable, less allowance
for doubtful accounts of $341,000 at 9/30/99
and $549,000 at 3/31/99 12,006,222 13,301,156
Inventories 12,867,386 12,009,770
Income Taxes Receivable 244,902 371,673
Prepaid Expenses and Deferred Charges 1,679,717 1,905,008
Deferred Tax Assets 257,480 257,480
------------ ------------
Current Assets 27,234,161 28,127,712
Properties, at cost, less accumulated
depreciation 7,367,531 6,886,231
Goodwill, less accumulated amortization of $3,085,151
at 9/30/99 and $2,473,621 at 3/31/99 21,215,866 21,738,856
Deferred Charges 188,952 214,295
Deferred Income Taxes 65,692 65,692
Other Assets 272,394 262,798
------------ ------------
$ 56,344,596 $ 57,295,584
============ ============
LIABILITIES AND STOCKHOLDERS' EQUITY:
Current Liabilities
Current Portion of Long Term Debt $ 2,450,000 $ 2,200,000
Accounts Payable 7,102,267 11,423,358
Accrued Payrolls, Commissions & Other 1,839,666 2,167,714
------------ ------------
Current Liabilities 11,391,933 15,791,072
Long-Term Debt 28,876,500 26,166,900
Deferred Compensation 398,348 431,609
------------ ------------
40,666,781 42,389,581
------------ ------------
Stockholders' Equity:
Common Stock, par value $.50 per share -
Authorized - 30,000,000 shares 2,995,294 2,966,371
Capital in Excess of Par Value 2,718,261 2,581,055
Accumulated Translation Adjustment (168,517) (200,568)
Retained Earnings 10,586,092 10,012,460
------------ ------------
16,131,130 15,359,318
Treasury stock, at cost, 119,358 shares at 9/30/99 (453,315) (453,315)
------------ ------------
15,677,815 14,906,003
------------ ------------
$ 56,344,596 $ 57,295,584
============ ============
</TABLE>
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
2
<PAGE> 3
TRANSMATION, INC.
CONSOLIDATED STATEMENT OF INCOME
UNAUDITED
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
------------------ ----------------
9/30/99 9/30/98 9/30/99 9/30/98
------- ------- ------- -------
<S> <C> <C> <C> <C>
Net Sales $19,210,385 $16,338,809 $39,245,199 $34,298,118
Costs and Expenses:
Cost of Product Sold 13,003,119 10,789,275 26,626,694 22,616,720
Selling & Admin. Expenses 4,656,038 4,105,171 9,538,642 8,734,246
Research & Develop. Costs 419,923 421,635 803,283 855,956
Interest Expense 656,957 556,625 1,319,248 1,147,035
18,736,037 15,872,706 38,287,867 33,353,957
Income Before Taxes 474,348 466,103 957,332 944,161
Provision for Income Taxes
State and Federal 190,900 181,000 383,700 369,500
Net Income 283,448 285,103 573,632 574,661
Retained Earnings at
Beginning of Period 10,302,644 9,252,917 10,012,460 8,963,359
Retained Earnings at
End of Period $10,586,092 $ 9,538,020 $10,586,092 $ 9,538,020
=========== =========== =========== ===========
Earnings Per Share - Basic $ .05 $ .05 $ .10 $ .10
=========== =========== =========== ===========
Earnings Per Share - Diluted $ .05 $ .05 $ .10 $ .09
=========== =========== =========== ===========
Shares Used In Calculation
Basic 5,843,996 5,808,712 5,843,996 5,808,712
=========== =========== =========== ===========
Diluted 5,954,109 6,049,382 5,954,109 6,049,382
=========== =========== =========== ===========
</TABLE>
3
<PAGE> 4
TRANSMATION, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
UNAUDITED
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
------------------ ----------------
9/30/99 9/30/98 9/30/99 9/30/98
------- ------- ------- -------
<S> <C> <C> <C> <C>
Cash Flows from Operating Activities
Net Income $ 283,448 $ 285,103 $ 573,632 $ 574,661
Adjustments to reconcile net income to net cash
provided from operating activities
Depreciation and Amortization 1,168,060 1,059,709 2,325,902 2,186,334
Provision for Losses on Accounts Receivable (134,000) (14,000) (208,000) (65,000)
Life Insurance Policies (9,596) (9,285) (9,596) (9,285)
Decrease in Accounts Receivable 1,678,146 235,701 1,502,934 1,907,274
Decrease (Increase) in Inventories 387,900 353,003 (857,616) 68,063
Increase in Prepaid Expenses and Deferred Charges (322,783) (334,443) (395,053) (745,774)
(Decrease) Increase in Accounts Payable (1,920,883) (1,066,876) (4,321,091) (2,325,606)
Decrease in Accrued Payrolls, Commissions
& Other Liabilities (414,027) 47,261 (328,048) (328,312)
Increase (Decrease) in Income Taxes
Receivable/Payable 1,653 52,375 126,771 (21,866)
Decrease in Deferred Compensation (16,411) (17,725) (33,261) (35,449)
----------- ----------- ----------- -----------
Net Cash Provided (used) by Operating Activities 701,507 590,823 (1,623,426) 1,205,040
----------- ----------- ----------- -----------
Cash Flows from Investing Activities:
Purchase of Metermaster 99,954 (88,540)
Purchase of Properties (432,986) (314,774) (1,549,985) (677,966)
----------- ----------- ----------- -----------
Net Cash (used in) Investing Activities (333,032) (314,774) (1,638,525) (677,966)
----------- ----------- ----------- -----------
Cash Flows from Financing Activities:
(Dec)Inc. in Notes Payable & Current Portion of LTD 125,000 (856,000) 250,000 (3,356,000)
Issuance of Common Stock 94,678 122,367 166,129 233,485
(Decrease) Increase in Long-Term Debt (936,900) 693,564 2,709,600 2,679,278
----------- ----------- ----------- -----------
Net Cash Provided by (used in) Financing Activities (717,222) (40,069) 3,125,729 (443,237)
----------- ----------- ----------- -----------
Effect of Exchange Rate Changes on Cash (5,010) (67,627) 32,051 (105,944)
----------- ----------- ----------- -----------
Net Increase (Decrease) in Cash (353,757) 168,353 (104,171) (22,107)
Cash at Beginning of Period 532,211 462,204 282,625 652,664
----------- ----------- ----------- -----------
Cash at End of Period $ 178,454 $ 630,557 $ 178,454 $ 630,557
=========== =========== =========== ===========
Cash Paid for Interest and Income Taxes is as follows:
Interest Paid $ 649,409 $ 417,713 $ 1,263,258 $ 1,055,416
Taxes Paid $ 202,210 $ 147,830 $ 269,507 $ 338,127
</TABLE>
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
4
<PAGE> 5
TRANSMATION, INC.
CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY
UNAUDITED
<TABLE>
<CAPTION>
Number of
Shares of
$.50 Par
Value Common Accumulated
Common Stock Capital in Other
Stock Issued and Excess of Retained Comprehensive Treasury
Outstanding Outstanding Par Value Earnings (Loss) Income Stock Total
----------- ----------- --------- -------- ------------- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C>
Balance, March 31, 1996 2,451,946 $1,225,973 $1,124,583 $ 5,905,652 ($93,819) $8,162,389
Components of
Comprehensive Income:
Net Income 2,059,736 2,059,736
Currency Translation
Adjustment (36,713) (36,713)
-----------
Total Comprehensive Income 2,023,023
Issuance of Stock 374,466 187,233 1,997,163 2,184,396
--------- ---------- ---------- ----------- --------- -----------
Balance, March 31, 1997 2,826,412 1,413,206 3,121,746 7,965,388 (130,532) 12,369,808
Components of
Comprehensive Income:
Net Income 997,971 997,971
Currency Translation
Adjustment 9,744 9,744
-----------
Total Comprehensive Income 1,007,715
Issuance of Stock 150,838 75,419 532,217 607,636
Two for One Stock Split on
July 22, 1997 2,853,692 1,426,846 (1,426,846)
--------- ---------- ---------- ----------- --------- -----------
Balance, March 31, 1998 5,830,942 2,915,471 2,227,117 8,963,359 (120,788) 13,985,159
Components of
Comprehensive Income:
Net Income 1,049,101 1,049,101
Currency Translation
Adjustment (79,780) (79,780)
-----------
Total Comprehensive Income 969,321
Issuance of Stock 101,800 50,900 353,938 404,838
Share Repurchase ($453,315) (453,315)
--------- ---------- ---------- ----------- --------- --------- -----------
Balance, March 31, 1999 5,932,742 2,966,371 2,581,055 10,012,460 (200,568) (453,315) 14,906,003
Components of
Comprehensive Income:
Net Income 573,632 573,632
Currency Translation
Adjustment 32,051 32,051
-----------
Total Comprehensive Income 605,683
Issuance of Stock 57,846 28,923 137,206 166,129
--------- ---------- ---------- ----------- --------- --------- -----------
Balance, September 30, 1999 5,990,588 $2,995,294 $2,718,261 $10,586,092 ($168,517) ($453,315) $15,677,815
========= ========== ========== =========== ========= ========= ===========
</TABLE>
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
5
<PAGE> 6
TRANSMATION, INC.
Notes to the Consolidated Financial Statements
Note 1 - Consolidated Financial Statements
- ------------------------------------------
The consolidated balance sheets, statements of income, cash flow and
stockholders' equity for the periods ended September 30, 1999 and September 30,
1998 have been prepared by the Company without audit. In the opinion of
Management, all adjustments necessary to present fairly the financial position,
results of operations, and changes in cash flows at September 30, 1999 (which
include only normal recurring adjustments), have been made.
Certain information and footnote disclosures normally included in financial
statements prepared in accordance with generally accepted accounting principles
have been condensed or omitted. It is suggested that these financial statements
be read in conjunction with the financial statements and notes thereto included
in the Company's March 31, 1999, annual report to shareholders. The results of
operations for the six months ended September 30, 1999, are not necessarily
indicative of the operating results for the full year.
Note 2 - Earnings Per Share
- ---------------------------
Net income per share - basic - excludes dilution and is computed by dividing net
income by the weighted average number of common shares outstanding during the
reporting period. Net income per share - diluted - reflects the potential
dilution that could occur if stock options and warrants were exercised.
6
<PAGE> 7
Item 2 - Management's Discussion and Analysis of Results of Operations and
- --------------------------------------------------------------------------
Financial Condition
-------------------
The following discussion is based primarily on the consolidated financial
statements of Transmation, Inc. as of September 30, 1999 and 1998 and for the
six and three month periods then ended. This information should be read in
conjunction with the accompanying consolidated financial statements and notes
thereto.
Forward-Looking Statements
- --------------------------
This discussion contains forward-looking statements. Although the Company
believes expectations reflected in such forward-looking statements are based on
reasonable assumptions, it can give no assurance that its expectations will be
achieved. Factors that may cause actual results to differ include general
economic conditions and other conditions that might affect operating expenses.
Liquidity and Capital Resources
- -------------------------------
The Company's primary sources of liquidity and capital are funds provided
through its borrowing agreement with banks, its profitability and management of
its Balance Sheet.
In the first six months of fiscal 2000, the company reduced the amount of trade
accounts receivable by $1,502,934. During the same period, inventories increased
by $857,616 and accounts payable decreased by $4,321,091. The reduction in
accounts payable resulted primarily from the liquidation of payables acquired in
the February, 1999 Metermaster acquisition. Bank debt increased by $2,959,600 as
the result of the foregoing. It is the Company's intention to reduce trade
receivables and inventories during the balance of the current fiscal year and to
use cash to reduce bank debt and otherwise fund ongoing business needs. During
the quarter ended September 30, 1999, trade receivables were reduced by
$1,678,146 and inventories were reduced by $387,900, trade payables were reduced
$1,920,883 and accrued liabilities were reduced by $414,027. Considering the
foregoing together with cash flow generated from operations, bank debt was
reduced by $811,900 in the three month period ended September 30, 1999.
7
<PAGE> 8
Results of Operations
- ---------------------
Comparison of July 1, 1999 - September 30, 1999
- -----------------------------------------------
to
July 1, 1998 - September 30, 1998
---------------------------------
Sales totaled $19,210,385 in the quarter ended September 30, 1999. This compares
to sales of $16,338,809 recorded in the same quarter in 1998. The increase in
1999 is primarily the result of the Company's acquisition of Metermaster in
February, 1999.
Cost of products sold totaled 67.7% of sales in 1999 compared to 66% of sales in
1998. Certain service locations and other operations acquired in the February,
1999 Metermaster acquisition have sustained greater operating cost levels than
have historically existed within the Company. The Company has taken action and
will continue to take required actions to reduce operating costs at all
locations. Selling and administrative expenses totaled 24.2% of sales in the
quarter ended September 30, 1999 compared to 25.1% of sales in the same period
one year ago. This improvement is due largely to economies of scale which
resulted from the higher sales levels that have been achieved. Interest expense
increased by nearly $100,000 or 17.9% in the quarter ended September 30, 1999
compared to the same quarter in 1998. This increase resulted from additional
borrowings undertaken due to the Metermaster acquisition in February, 1999.
Comparison of April 1, 1999 - September 30, 1999
- ------------------------------------------------
to
April 1, 1998 - September 30, 1998
----------------------------------
Sales totaled $39,245,199 in the six months ended September 30, 1999. This
compares to sales of $34,298,118 in the same six month period in 1998. The
increase in 1999 is primarily the result of the Company's acquisition of
Metermaster in February, 1999.
Cost of products sold totaled 67.8% of sales in 1999 compared to 65.9% of sales
in 1998. Certain service locations and other operations acquired in the
February, 1999 Metermaster acquisition have greater operating cost levels than
have historically existed within the Company. The Company has and will continue
to take action to reduce operating costs at all locations to appropriate levels.
Selling and administrative expenses in the six months ended September 30, 1999
totaled 24.3% of sales compared to 25.5% of sales in the same six months in
1998. Interest expense increased by 15% in the six months ended September 30,
1999 compared to the same period in 1998. This increase resulted from additional
borrowings undertaken due to the Metermaster acquisition in February, 1999.
8
<PAGE> 9
PART II
-------
OTHER INFORMATION
-----------------
Item 4. Submission of Matters to a Vote of Security Holders
- ------- ---------------------------------------------------
At the Company's Annual Meeting on August 17, 1999, shareholders of the Company
approved Proposals 1, 2, 4, 5 and 6 below. Proposal 3 was defeated. Results of
the voting are as follows:
Proposal 1:
- -----------
To elect Directors to serve until the 2001 Annual Meeting:
Authority
For Withheld
--- --------
Angelo J. Chiarella 4,577,364 665,164
E. Lee Garelick 4,785,511 457,017
Dr. Harvey Palmer 4,637,838 604,690
Messrs. Oberlies, Murphy, Richardson, Klimasewski and McInroy and Mrs. Hessler
did not stand for re-election to Transmation's Board of Directors in 1999.
Proposal 2:
- -----------
To approve and adopt an amendment to the Company's Articles of Incorporation
which increases the number of shares of the Company's authorized common stock
from 15,000,000 shares to 30,000,000 shares:
For Against Abstain
--- ------- -------
4,885,135 337,913 19,480
Proposal 3:
- -----------
To approve and adopt an amendment to the Company's Code of Regulations which
permits the number of directors of the Company to be fixed or changed by the
Board of Directors as well as by the shareholders:
For Against Abstain
--- ------- -------
3,744,911 394,952 26,710
9
<PAGE> 10
Proposal 4:
- -----------
To approve and ratify an amendment to the Transmation, Inc. Amended and Restated
1993 Stock Option Plan which permits exercise of previously granted options by
persons who are no longer employees of the Company but continue to serve as
non-employee directors of the Company:
For Against Abstain
--- ------- -------
4,258,064 932,683 51,680
Proposal 5:
- -----------
To approve and ratify an amendment to the Transmation, Inc. Amended and Restated
Directors' Warrant Plan which permits the exercise of the warrants for a period
of 90 days after cessation of service as a director of the Company:
For Against Abstain
--- ------- -------
4,768,999 437,038 36,491
Proposal 6:
- -----------
To approve and ratify the selection of Pricewaterhouse Coopers LLP as the
Company's independent auditors for the fiscal year ending March 31, 2000:
For Against Abstain
--- ------- -------
5,225,116 9,412 8,000
10
<PAGE> 11
Item 6 - Exhibits and Reports on Form 8-K
- -----------------------------------------
a) See Index to Exhibits.
b) Reports on Form 8-K.
No reports on Form 8-K have been filed during the quarter for which
this report is filed.
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.
TRANSMATION, INC.
Date November 8, 1999 /s/ Eric W. McInroy
- --------------------------- ------------------------------
Eric W. McInroy
President and CEO
Date November 8, 1999 /s/ John A. Misiaszek
- --------------------------- ------------------------------
John A. Misiaszek
Vice President, Finance
11
<PAGE> 12
INDEX TO EXHIBITS
(2) Plan of acquisition, reorganization, arrangement, liquidation or succession
Not applicable.
(3) Articles of Incorporation and By Laws
(i) The Articles of Incorporation, as amended, are incorporated herein by
reference to Exhibit 4(a) to the Registrant's Registration Statement
on Form S-8 (Registration No. 33-61665) filed on August 8, 1995 and
Exhibit I to the Registrant's Form 10-Q for the quarter ended
September 30, 1996.
* Certificate of Amendment is included herein as Exhibit 3 (i).
(ii) By-laws, as amended through August 18, 1987, are incorporated herein
by reference to Exhibit (3) to the Registrant's Form 10-K for the year
ended March 31, 1988.
(4) Instruments defining the rights of security holders, including indentures
Credit and Loan Agreement dated August 7, 1998 between Transmation, Inc.
and KeyBank National Association is incorporated herein by reference to
Exhibit 4(a) to the Registrant's Form 10-Q for the quarter ended September
30, 1998.
(10) Material Contracts
(a) The documents listed under (4) are incorporated herein by reference.
(b) Amendment No. 6 to the Transmation, Inc. Amended and Restated 1993
Stock Option Plan is incorporated herein by reference to Appendix A to the
Registrant's 1999 Preliminary Proxy Statement which was filed in electronic
format on June 21, 1999.
(c) Amendment No. 5 to the Transmation, Inc. Amended and Restated
Directors' Warrant Plan is incorporated herein by reference to Appendix B
to the Registrant's 1999 Preliminary Proxy Statement which was filed in
electronic format on June 21, 1999.
(11) Statement re computation of per share earnings Computation can be clearly
determined from the Financial Statements included herein at Item 1.
12
<PAGE> 13
(15) Letter re unaudited interim financial information
Not applicable.
(18) Letter re change in accounting principles
Not applicable.
(19) Report furnished to security holders
Not applicable.
(22) Published report regarding matters submitted to vote of security holders
Not applicable.
(23) Consents of experts and counsel
Not applicable.
(24) Power of attorney
Not applicable.
*(27) Financial Data Schedule
The Financial Data Schedule is included herein as Exhibit 27.
(99) Additional Exhibits
Not applicable.
- -----------------
* Exhibit filed with this Report
13
<PAGE> 1
EXHIBIT 3 (i)
CERTIFICATE OF AMENDMENT
TO THE
ARTICLES OF INCORPORATION
OF
TRANSMATION, INC.
Eric W. McInroy and John A. Misiaszek, being the President and
Secretary, respectively, of Transmation, Inc., an Ohio corporation (the
"Corporation"), do hereby certify that the annual meeting of shareholders of the
Corporation was duly called and held on August 17, 1999, at which meeting a
quorum of shareholders entitled to vote at the meeting was present in person or
by proxy, and that by the affirmative vote of the holders of shares entitled to
exercise not less than two-thirds of the voting power of the Corporation on such
proposal (no greater vote being required by the Articles of Incorporation), the
following resolution was adopted:
RESOLVED, that the Articles of Incorporation be amended to
increase the number of shares of Common Stock which the
Corporation is authorized to issue from 15,000,000 to 30,000,000.
Article FOURTH of the Articles of Incorporation is, therefore, hereby
amended to provide in its entirety as follows:
"FOURTH: The maximum number of shares which the
Corporation is authorized to have outstanding is 30,000,000, all
of which shall be Common Shares with a par value of Fifty Cents
($.50) each. No holder of shares of the Corporation of any class
shall be entitled as such, as a matter of right, to subscribe for
or purchase shares of the Corporation, or to purchase or
subscribe for securities convertible into or exchangeable for
shares of the Corporation, or to which shall be attached or
appertain any warrants or rights entitling the holder thereof to
subscribe for or purchase shares of the Corporation, except such
rights of subscription or purchase, if any, for such
considerations and upon such terms and conditions as its Board of
Directors from time to time may determine."
<PAGE> 2
IN WITNESS WHEREOF, we have signed this Certificate and affixed the
corporate seal this 13th day of September, 1999.
/s/ Eric W. McInroy
----------------------
Eric W. McInroy
President
/s/ John A. Misiaszek
[corporate seal] ----------------------
John A. Misiaszek
Secretary
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Company's September 30, 1999 Form 10-Q and is qualified in its entirety by
reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> MAR-31-2000
<PERIOD-END> SEP-30-1999
<CASH> 178,454
<SECURITIES> 0
<RECEIVABLES> 12,347,222
<ALLOWANCES> 341,000
<INVENTORY> 12,867,386
<CURRENT-ASSETS> 27,234,161
<PP&E> 14,132,145
<DEPRECIATION> 6,764,614
<TOTAL-ASSETS> 56,344,596
<CURRENT-LIABILITIES> 11,391,933
<BONDS> 28,876,500
0
0
<COMMON> 2,995,294
<OTHER-SE> 12,682,521
<TOTAL-LIABILITY-AND-EQUITY> 56,344,596
<SALES> 30,812,401
<TOTAL-REVENUES> 39,245,199
<CGS> 20,654,399
<TOTAL-COSTS> 26,626,694
<OTHER-EXPENSES> 10,549,925
<LOSS-PROVISION> (208,000)
<INTEREST-EXPENSE> 1,319,248
<INCOME-PRETAX> 957,332
<INCOME-TAX> 383,700
<INCOME-CONTINUING> 573,632
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 573,632
<EPS-BASIC> .10
<EPS-DILUTED> .10
</TABLE>
