1
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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, 1998
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 No. 0-18492
DIGITAL SOLUTIONS, INC.
(Exact name of registrant as specified in its charter)
New Jersey 22-1899798
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
300 Atrium Drive, Somerset, NJ 08873
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (732) 748-1700
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 / /
19,298,010 shares of Common Stock, par value $.001 per share, were outstanding
as of May 13, 1998.
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DIGITAL SOLUTIONS, INC. AND SUBSIDIARIES
FORM 10-Q
March 31, 1998
Table of Contents
Page No.
Part I - Financial Information
Item 1. Consolidated Balance Sheets as of
March 31, 1998 (Unaudited) and
September 30, 1997 3
Consolidated Statements of
Income for the three months ended
March 31, 1998 and 1997 (Unaudited) 5
Consolidated Statements of
Income for the six months ended
March 31, 1998 and 1997 (Unaudited) 6
Consolidated Statements of Cash Flows for the
six months ended March 31, 1998 and 1997
(Unaudited) 7
Notes to Consolidated Financial Statements
(Unaudited) 8
Item 2. Management's discussion and analysis of
financial condition and results of operations 11
Part II - Other Information
Item 1. Legal Proceedings 14
Item 5. Other Information 14
Item 6. Exhibits and Reports on Form 8-K 15
Signatures 16
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DIGITAL SOLUTIONS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
MARCH 31, SEPTEMBER 30,
1998 1997
----------- -----------
(unaudited)
ASSETS
CURRENT ASSETS
Cash $ 1,244,000 $ 841,000
Restricted Cash 738,000 738,000
Accounts receivable, net of allowance 5,300,000 5,820,000
Other current assets 962,000 402,000
----------- -----------
Total current assets 8,244,000 7,801,000
EQUIPMENT AND IMPROVEMENTS
Equipment 3,319,000 3,170,000
Leasehold improvements 49,000 47,000
----------- -----------
3,368,000 3,217,000
Accumulated depreciation and amortization 2,460,000 2,310,000
----------- -----------
908,000 907,000
DEFERRED TAX ASSET 380,000 760,000
GOODWILL, net of amortization 4,220,000 4,344,000
OTHER ASSETS 279,000 351,000
----------- -----------
TOTAL ASSETS $14,031,000 $14,163,000
=========== ===========
The accompanying notes to the consolidated financial statements are an integral
part of these consolidated balance sheets.
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DIGITAL SOLUTIONS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
MARCH 31, SEPTEMBER 30,
1998 1997
------------ ------------
(unaudited)
LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Short-term borrowings $ -- $ 2,697,000
Current portion of long-term debt 569,000 113,000
Accounts payable 2,281,000 2,254,000
Accrued expenses and other current liabilities 3,357,000 4,138,000
------------ ------------
Total current liabilities 6,207,000 9,202,000
LONG-TERM DEBT 1,998,000 89,000
------------ ------------
Total Liabilities 8,205,000 9,291,000
COMMITMENTS AND CONTINGENCIES
SHAREHOLDERS' EQUITY
Common Stock, $.001 par value; authorized 40,000,000 shares;
issued and outstanding 19,298,010 and 19,141,760 at
March 31, 1998 and September 30, 1997, respectively 19,000 19,000
Additional paid-in capital 13,643,000 13,393,000
Accumulated deficit (7,836,000) (8,540,000)
------------ ------------
Total shareholders' equity 5,826,000 4,872,000
------------ ------------
TOTAL LIABILITIES AND EQUITY $ 14,031,000 $ 14,163,000
============ ============
The accompanying notes to the consolidated financial statements are an integral
part of these consolidated balance sheets.
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DIGITAL SOLUTIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
FOR THE THREE MONTHS
MARCH 31,
--------------------------------
1998 1997
------------ ------------
REVENUES $ 32,575,000 $ 30,225,000
DIRECT EXPENSES 30,346,000 28,633,000
------------ ------------
Gross profit 2,229,000 1,592,000
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 1,761,000 4,307,000
DEPRECIATION AND AMORTIZATION 170,000 438,000
------------ ------------
Income (loss) from operations 298,000 (3,153,000)
------------ ------------
OTHER INCOME (EXPENSE)
Interest and other income 11,000 16,000
Interest expense (105,000) (105,000)
------------ ------------
(94,000) (89,000)
------------ ------------
Income (loss) before tax 204,000 (3,242,000)
INCOME TAX -- --
------------ ------------
NET INCOME (LOSS) $ 204,000 $ (3,242,000)
============ ============
BASIC EARNINGS (LOSS) PER COMMON SHARE $ 0.01 $ (0.17)
============ ============
WEIGHTED AVERAGE SHARES OUTSTANDING 19,298,010 19,085,036
============ ============
DILUTED EARNINGS (LOSS) PER COMMON SHARE $ 0.01 $ (0.17)
============ ============
DILUTED SHARES OUTSTANDING 19,618,273 19,085,036
============ ============
The accompanying notes to the consolidated financial statements are an integral
part of these consolidated statements.
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DIGITAL SOLUTIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
FOR THE SIX MONTHS
MARCH 31,
--------------------------------
1998 1997
------------ ------------
REVENUES $ 66,237,000 $ 61,110,000
DIRECT EXPENSES 61,406,000 57,003,000
------------ ------------
Gross profit 4,831,000 4,107,000
SELLING, GENERAL AND ADMINISTRATIVE EXPENSES 3,618,000 6,368,000
DEPRECIATION AND AMORTIZATION 339,000 617,000
------------ ------------
Income (loss) from operations 874,000 (2,878,000)
------------ ------------
OTHER INCOME (EXPENSE)
Interest and other income 23,000 33,000
Interest expense (193,000) (196,000)
------------ ------------
(170,000) (163,000)
------------ ------------
Income (loss) before tax 704,000 (3,041,000)
INCOME TAX -- --
------------ ------------
NET INCOME (LOSS) $ 704,000 $ (3,041,000)
============ ============
BASIC EARNINGS (LOSS) PER COMMON SHARE $ 0.04 $ (0.16)
============ ============
WEIGHTED AVERAGE SHARES OUTSTANDING 19,234,889 19,021,425
============ ============
DILUTED EARNINGS (LOSS) PER COMMON SHARE $ 0.04 $ (0.16)
============ ============
DILUTED SHARES OUTSTANDING 19,572,183 19,021,425
============ ============
The accompanying notes to the consolidated financial statements are an integral
part of these consolidated statements.
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DIGITAL SOLUTIONS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
FOR THE SIX MONTHS
MARCH 31,
------------------------------
1998 1997
----------- -----------
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) $ 704,000 $(3,041,000)
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
Depreciation and amortization 339,000 617,000
Provision for doubtful accounts 35,000 1,052,000
Other non cash items -- 1,148,000
Changes in operating assets and liabilities:
Accounts receivable 485,000 (1,698,000)
Other current assets (173,000) (254,000)
Notes due from officers -- 136,000
Accounts payable, accrued expenses and
other current liabilities (754,000) 2,142,000
----------- -----------
Net cash provided by operating activities 636,000 102,000
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of equipment and improvements (151,000) (105,000)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from borrowings on revolving line of credit -- 410,000
Repayments on revolving line of credit (260,000) (360,000)
Payments under capital lease obligations (72,000) (44,000)
Proceeds from reduction of required Letters of Credit -- 417,000
Proceeds from issuance of common stock and
exercise of common stock options and warrants - net 250,000 229,000
----------- -----------
Net cash (used in) provided by financing activities (82,000) 652,000
----------- -----------
Net increase in cash 403,000 649,000
CASH AT BEGINNING OF PERIOD 841,000 --
----------- -----------
CASH AT END OF PERIOD $ 1,244,000 $ 649,000
=========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the period for interest $ 181,000 $ 183,000
=========== ===========
The accompanying notes to the consolidated financial statements are an integral
part of these consolidated statements.
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DIGITAL SOLUTIONS, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
(1) ORGANIZATION AND BUSINESS
Digital Solutions, Inc. (the Company) was incorporated under the laws of the
State of New Jersey on November 25, 1969. The Company, with its subsidiaries,
provides a broad spectrum of human resource services including Professional
Employer Organization (PEO) services, payroll processing, human resource
administration and placement of temporary and permanent employees.
(2) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation
The consolidated financial statements included herein have been prepared by the
registrant, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. Certain information and footnote disclosures
normally included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to such
rules and regulations, although the registrant believes that the disclosures are
adequate to make the information presented not misleading. These consolidated
financial statements should be read in conjunction with the consolidated
financial statements and the notes thereto included in the Company's latest
annual report on Form 10-K. This financial information reflects, in the opinion
of management, all adjustments necessary to present fairly the results for the
interim periods. The results of operations for such interim periods are not
necessarily indicative of the results for the full year.
The accompanying consolidated financial statements include those of DSI, a New
Jersey Corporation and its wholly-owned subsidiaries; DSI Contract Staffing, DSI
Staff ConnXions, Staff ConnXions - Northeast, Inc., DSI Staff ConnXions -
Southwest, and DSI Staff Rx, Inc. The results of operations of acquired
companies have been included in the consolidated financial statements from the
date of acquisition. All significant intercompany balances and transactions have
been eliminated in the consolidated financial statements.
Earnings Per Common Share
In March 1997, the Financial Accounting Standards Board issued Statement on
Financial Accounting Standards Number 128, "Earnings Per Share" (FAS No. 128).
FAS 128 requires the presentation of basic earnings per share and diluted
earnings per share for all
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periods presented. "Basic earnings per share" represents net income divided by
the weighted average shares outstanding. "Diluted earnings per share" represents
net income divided by weighted average shares outstanding adjusted for the
incremental dilution of outstanding stock options and awards.
A reconciliation of weighted average number of common shares outstanding to
weighted average common shares outstanding assuming dilution is as follows:
Three Months Ended March 31, Six Months Ended March 31,
1998 1997 1998 1997
---------- ---------- ---------- ----------
Weighted average number of common shares 19,298,010 19,085,036 19,234,889 19,021,425
Dilutive share equivalents of outstanding
stock options 320,263 -- 337,294 --
---------- ---------- ---------- ----------
Weighted average number of common shares
assuming dilution 19,618,273 19,085,036 19,572,183 19,021,425
========== ========== ========== ==========
Stock options outstanding at March 31, 1998 to purchase 599,479 shares of common
stock were not included in the computation of earnings per share assuming
dilution because the options' exercise prices were greater than the average
price of the common shares.
(3) COMMITMENTS AND CONTINGENCIES
In connection with the Company's former workers' compensation insurance policy
which expired on April 1, 1997, the insurance company developed reserve factors
on each claim that may or may not materialize after the claim is fully
investigated. Generally Accepted Accounting Principles require that all
incurred, but not paid claims, as well as an estimate for claims incurred, but
not reported (IBNR), be accrued on the balance sheet as a current liability,
although a portion of the claims may not be paid in the following 12 months. As
of March 31, 1998, this accrual amounted to $361,000. On April 1, 1997, the
Company entered into a workers' compensation policy with a new carrier. During
the six months ended March 31, 1998 and 1997, the Company recognized
approximately $508,000 and $517,000, respectively, as its share of premiums
collected from customers covered by these policies in excess of claims and fees
paid.
The Company has outstanding letters of credit amounting to $1,193,000 as of
March 31, 1998. The letters of credit are required to collateralize unpaid
claims in connection with the Company's former workers' compensation insurance
policy and can only be drawn upon by the beneficiary if the Company does not
perform according to the terms of the related agreement. The Company has
collateralized these letters of credit by maintaining compensating restricted
cash balances of $738,000 and utilizing $455,000 of amounts available under its
line of credit. The Company's current policy does not require a letter of credit
because the Company funds the estimated loss reserves on a monthly basis.
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(4) SHAREHOLDERS' EQUITY
During the first six months of fiscal 1998, $250,000 was received from an equity
investment by the Company directors and executive officers, as well as from a
former director, to be used for general corporate purposes.
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Results of Operations
Certain statements contained herein constitute "forward-looking
statements" within the meaning of the Private Securities Litigation Reform Act
of 1995 (the "1995 Reform Act"). Digital Solutions, Inc. (the "Company") desires
to avail itself of certain "safe harbor" provisions of the 1995 Reform Act and
is therefore including this special note to enable the Company to do so.
Forward-looking statements included in this report involve known and unknown
risks, uncertainties, and other factors which could cause the Company's actual
results, performance (financial or operating) or achievements to differ from the
future results, performance (financial or operating) achievements expressed or
implied by such forward looking statements. Such future results are based upon
management's best estimates based upon current conditions and the most recent
results of operations. These risks include, but are not limited to, risks
associated with the Company's risks of future acquisitions, effects of
competition and technological changes and dependence upon key personnel.
The Company's revenues for the three months ended March 31, 1998 and
1997 were $32,575,000 and $30,225,000, respectively, which represents an
increase of $2,350,000 or 7.8%. For the six months ended March 31, 1998 and
1997, the Company's revenues were $66,237,000 and $61,110,000, respectively,
which represents an increase of $5,127,000 or 8.4%. This increase is due to the
efforts of the internal sales force to continually bring in new business which
accounted for all of the increase. Revenues for the first six months ended March
31, 1997 include approximately $8,000,000 in revenue from two contracts
completed in the third quarter of fiscal 1997. Excluding these contracts,
revenues for the first six months of fiscal 1998 increased 25% over the
comparable prior year period.
Direct expenses were $30,346,000 for the three months ended March 31,
1998 and $28,633,000 for the comparable period last year, representing an
increase of $1,713,000 or 6.0%. The quarter ended March 31, 1997, included
adjustments amounting to $678,000 primarily related to a revised methodology in
evaluating workers' compensation reserves. In addition, the second quarter ended
March 31, 1997 also included an expense for underbilled/excess charges for
medical expenses in the amount of $206,000. After adjusting for these charges,
direct costs increased $2,597,000 or 9.4%. As a percentage of revenue, and on an
adjusted basis, direct expenses for the three months ended March 31, 1998 and
1997 were 93.2% and 91.8%, respectively. These increases represent the
corresponding higher costs associated with the increase in PEO business. For the
six months ended March 31, 1998 and 1997, direct costs increased $4,403,000 or
7.7%, from $57,003,000 to $61,406,000, respectively. For the first six months of
fiscal 1997 direct costs included $284,000 in underbilled/excess charges for
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medical expenses. After reflecting the adjustments previously discussed and
these medical expenses, direct costs increased $5,365,000 or 9.6%. As a
percentage of revenue, and on an adjusted basis, direct costs for the six
months ended March 31, 1998 and 1997 were 92.7% and 91.7%, respectively. These
increases were attributed to the same reasons previously discussed.
Gross profits were $2,229,000 and $1,592,000 for the quarters ended
March 31, 1998 and 1997, respectively, or an increase of $637,000. After
reflecting the above mentioned items in the second quarter of 1997, gross
profit for that period was $2,476,000. Gross profits, as a percentage of
revenue, were 6.8% and 8.2% for the quarters ended March 31, 1998 and 1997,
respectively, after reflecting the items previously discussed. For the six
months ended March 31, 1998 and 1997, gross profits increased to $4,831,000
from $4,107,000, respectively. After reflecting the previously discussed items,
gross profit for the six months ended 1997 was $5,069,000. As a percentage of
revenue, gross profits for the six months ended March 31, 1998 and 1997 were
7.3% and 8.3%, respectively, after reflecting for the items previously
discussed. The decrease in gross profits as a percentage of revenue is
attributed to an increase in the percentage of PEO business which has a lower
margin.
SG&A costs for the quarters ended March 31, 1998 and 1997 were
$1,761,000 and $4,307,000, respectively, representing a decrease of $2,546,000
or 59.1%. Included in the second quarter 1997 SG&A costs were $1,973,000 of
items including $1,002,000 to increase the Company's bad debt reserve, $300,000
to absorb miscellaneous charges, $124,000 to correct unrecorded 1996 expenses,
$102,000 to establish a vacation pay accrual, $81,000 to change supplies
accounting, $93,000 to establish a reserve for severance costs and $271,000 for
various other miscellaneous items. The need to substantially increase the
Company's bad debt reserve became evident after January, 1997 when previously
current clients became seriously delinquent. The Company is currently filing
legal claims to recover some of these amounts. Excluding these items, SG&A in
fiscal 1998 decreased by $573,000 or 24.5%. This decrease was largely
attributable to the reduction in overhead costs implemented in the fourth
fiscal quarter of 1997. For the six months ended March 31, 1998 and 1997 SG&A
decreased from $6,368,000 to $3,618,000, respectively. Included in the six
months ended March 31, 1997 SG&A costs were the same items as discussed above
as well as a first quarter severance charge of $51,000. After reflecting these
items, SG&A decreased by $726,000 or 16.7% which was attributable to the
reasons previously discussed.
Depreciation and amortization for the quarters ended March 31, 1998 and
1997 decreased to $170,000 from $438,000, respectively, or $268,000. The
decrease was attributable to the writing off of all intangible assets of Digital
Insurance Services, Inc. in the quarter ended March 31, 1997 as a result of
management's decision to abandon these assets since it was decided not to
remain in the insurance business. For the six month period ended March 31, 1998
and 1997, depreciation and amortization decreased from $617,000 to $339,000,
respectively, or $278,000. The decrease was attributable to the same reason as
explained above.
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Net income for the quarter ended March 31, 1998 was $204,000 versus a
net loss of $3,242,000 for the similar period in 1997. This increase of
$3,446,000 is attributed to the $3.1 million adjustments previously discussed
and the overhead reductions implemented in the fourth fiscal quarter of 1997.
For the six months ended March 31, 1998 the Company reported net income of
$704,000 versus a loss of $3,041,000 in the similar period of 1997 or an
increase of $3,745,000. This increase is attributable to the same reasons as
reported above.
Liquidity and Capital Resources
The Company's working capital position as of March 31, 1998 was
$2,037,000 versus a working capital deficit of ($1,401,000) as of September 30,
1997. The improved working capital position is attributable to the continued
earnings improvement of the Company and the successful refinancing of the
Company's short term borrowings, as discussed below, to a long term credit
facility. At March 31, 1998, the Company had cash of $1,244,000, restricted cash
of $738,000 and accounts receivable of $5,300,000.
In February 1995, the Company entered into a one year revolving credit
line facility (the "Line") with a bank which was subsequently extended and
amended on seven occasions. At September 30, 1997 and March 31, 1998, the total
amount outstanding on the Line was $2,697,000 and $2,437,000, respectively. On
April 29, 1998, the Company was successful in replacing the former credit
facility with a new long term credit facility from FINOVA Capital Corporation
totaling $4.5 million. The credit facility includes a three year term loan for
$2.5 million, with a five year amortization, at prime + 3% (currently 11.5%) and
a $2 million revolving line of credit secured by certain accounts receivable of
the Company at prime + 1% (currently 9.5%). Taking various fees into
consideration and assuming the Company continuously fully utilizes the revolver,
the effective rate of interest on the total borrowings is approximately 16.1%.
The balance sheet as of March 31, 1998 reflects the categorization of the bank
debt between short-term and long-term due to the new financing. The short-term
portion reflects the next twelve months of principal payments due Finova
starting June 1, 1998. The long-term portion reflects the balance of the bank
debt owed as of March 31, 1998.
Inflation and changing prices have not had a material effect on the
Company's net revenues and results of operations in the last three fiscal years,
as the Company has been able to modify its prices to respond to inflation and
changing prices.
Year 2000 Issue
The year 2000 issue is the programming of computer systems to recognize
the values "00" in a date field as the year 2000 and not the year 1900. The
Company began steps in 1997 to reasonably ensure that the software it utilizes
will be year 2000 compliant. The Company is utilizing internal staff and
external sources to make its information technology/computer systems year 2000
compliant. The Company believes that with modifications to existing software and
conversions to new software, the year 2000 issue will not pose significant
operational problems.
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Statement of Financial Accounting Standards
In June, 1997, the Financial Accounting Standards Board (FASB) issued
Statement of Financial Accounting Standards No. 130, "Reporting Comprehensive
Income" ("SFAS 130"), which establishes standards for reporting and displaying
comprehensive income and its components. The components of comprehensive income
refer to revenues, expenses, gains and losses that are excluded from net income
under current accounting standards, including unrecognized foreign currency
translation items, minimum pension liability adjustments and unrealized gains
and losses on certain investments in debt and equity securities. SFAS 130
requires that all items that are recognized under accounting standards as
components of comprehensive income be reported in a financial statement
displayed in equal prominence with the other financial statements; the total of
other comprehensive income for a period is required to be transferred to a
component of equity that is separately displayed in a statement of financial
position at the end of an accounting period. SFAS 130 is effective for both
interim and annual periods beginning after fiscal December 15, 1997, at which
time the Company will adopt the provisions. The Company does not expect SFAS 130
to have a material effect on reported results.
In June 1997, the FASB issued Statement of Financial Accounting
Standards No. 131, "Disclosures about Segments of an Enterprise and Related
Information" ("SFAS 131"). SFAS 131 establishes standards for the way public
enterprises are to report information about operating segments in interim
financial statements and requires the reporting of 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. SFAS 131 is effective for periods
beginning after fiscal December 15, 1997, at which time the Company will adopt
the provisions. The Company does not expect SFAS 131 to have a material effect
on reported results.
PART II
OTHER INFORMATION
Item 1. Legal Proceedings
At March 31, 1998 the Company is involved in various other legal
proceedings incurred in the normal course of business. In the second fiscal
quarter ended March 31, 1998, the Company commenced legal actions to pursue the
collection of past due accounts receivable balances. In the opinion of
management and its counsel, none of these proceedings would have a material
effect, if adversely decided, on the consolidated financial position or results
of operations of the Company.
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Item 5. Other Events
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits - None
(b) Reports on Form 8-K
none filed during the quarter ended March 31, 1998.
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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.
DIGITAL SOLUTIONS, INC.
(Registrant)
/s/ Donald W. Kappauf
---------------------
Donald W. Kappauf
Chief Executive Officer
/s/ Donald T. Kelly
-------------------
Donald T. Kelly
Chief Financial Officer
Date: May 13, 1998
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3-MOS
SEP-30-1998
JAN-01-1998
MAR-31-1998
1,244,000
0
5,888,000
(588,000)
0
8,244,000
3,368,000
(2,460,000)
14,031,000
6,207,000
0
0
0
(19,000)
(5,807,000)
14,031,000
0
32,575,000
0
30,346,000
0
(21,000)
(105,000)
204,000
0
204,000
0
0
0
204,000
.01
.01
AMOUNT REPORTED ACTUALLY REFLECTS EPS-BASIC NOT EPS-PRIMARY.
