UNITED STATES
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 fiscal quarter ended
March 31, 1996.
[ ] 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 2-64413
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RMI COVERED HOPPER RAILCAR MANAGEMENT PROGRAM 79-1
(Exact name of registrant as specified in its charter)
California 94-2645847
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Market, Steuart Street Tower
Suite 900, San Francisco, CA 94105-1301
(Address of principal (Zip code)
executive offices)
Registrant's telephone number, including area code (415) 974-1399
-----------------------
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 ______
<PAGE>
RMI COVERED HOPPER RAILCAR MANAGEMENT PROGRAM 79-1
STATEMENTS OF REVENUES COLLECTED AND EXPENSES PAID
AND OTHER CHANGES IN CASH
<TABLE>
<CAPTION>
For the three months
ended March 31,
--------------------------
1996 1995
--------------------------
<S> <C> <C>
Revenues Collected:
Lease revenue received $ 634,046 $ 675,433
Interest and other income 20,197 24,646
----------- -----------
Total revenues collected 654,243 700,079
Expenses:
Repairs and maintenance 72,387 74,441
Property taxes 6,092 4,623
Accounting and legal fees 3,323 2,123
Storage, repositioning and other 5,797 2,633
----------- -----------
Total expenses paid 87,599 83,820
----------- -----------
Excess of revenues collected
over expenses paid 566,644 616,259
----------- -----------
Other increases (decreases) in cash:
Prepaid mileage, reimbursable repairs
and other (67,020) 31,394
Management fees paid (68,004) (63,946)
Receipt of proceeds from sold or destroyed cars 899,000 22,461
Receipt of proceeds for transfer of car ownership 25,000 --
Payments to investors for sold or destroyed cars -- (23,040)
Payments to investors for transfer of car ownership (24,000) --
Commission paid for sold or destroyed cars (35,960) --
Commission paid for transfer of car ownership (1,000) --
Distributions to investors (444,777) (421,584)
----------- -----------
Net other increases (decreases) in cash 283,239 (454,715)
----------- -----------
Net increase in cash 849,883 161,544
Cash at beginning of period 1,581,112 1,377,325
----------- -----------
Cash at end of period $ 2,430,995 $ 1,538,869
=========== ===========
</TABLE>
See accompanying notes to financial
statements.
<PAGE>
RMI COVERED HOPPER RAILCAR MANAGEMENT PROGRAM 79-1
NOTES TO THE STATEMENTS OF REVENUES COLLECTED AND EXPENSES PAID
AND OTHER CHANGES IN CASH
March 31, 1996
1. Basis of Presentation
RMI Covered Hopper Railcar Management Program 79-1 (the Program) is not a legal
entity. The statements of revenues collected and expenses paid and other changes
in cash (the Statements) of the Program are presented on the cash basis of
accounting, used for reporting to investors in the Program in accordance with
the Management Agreement with PLM Investment Management, Inc. (IMI). Under the
cash basis, revenues are recognized when received, rather than when earned, and
expenses are recognized when paid, rather than when the obligation is incurred.
Accordingly, the Statements are not intended to present financial position, or
results of operations or cash flows in accordance with generally accepted
accounting principles.
2. Operations
At March 31, 1996, 470 cars, which are owned by the investors, were being
managed by IMI under the Program, all of which were covered by lease agreements.
During the three months ending March 31, 1996, four cars were added, 29 cars
were sold and one railcar was transferred from one investor to other investor
and IMI received a commission fee of $35,960 and $1,000 to handle the sale and
transfer, respectively.
3. Equalization reserve
Under the terms of the management agreement, IMI may, at its discretion, cause
the Program to retain a certain amount of cash (the working capital reserve) to
cover future disbursements and provide for a balanced distribution of funds to
the investors each quarter. IMI has determined the working capital reserve at
March 31, 1996, to be $875,370 ($873,359 at December 31, 1995).
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF CASH BALANCES AND RESULTS OF
OPERATIONS
Liquidity and Capital Resources
The Program's capital commitments consist of paying operating expenses, and to
the extent funds are available, making cash distributions to the investors. Cash
reserves are considered sufficient to cover all known liabilities of the
equipment pool.
Comparison of the Program's Revenues Collected, Expenses Paid and Other Changes
in Cash for the Three Months Ended March 31, 1996 and 1995
Revenues collected:
(1) Lease receipts decreased to $634,046 in the first quarter of 1996 from
$675,433 in the first quarter of 1995. The decrease is primarily due to the
timing of receipt of revenues during the comparable periods and the disposition
of two cars during the last three quarters of 1995 and 29 cars which were sold
during the first quarter of 1996.
(2) Interest and other income decreased to $20,197 in the first quarter of 1996,
from $24,646 in the first quarter of 1995, due to lower interest income
resulting from lower rate of interest paid.
Expenses paid:
(1) Repairs and maintenance expense decreased to $72,387 in the first quarter of
1996, from $74,441 in the first quarter of 1995. The decrease is due to the
timing of payments of expenses during comparable periods.
(2) Property taxes increased to $6,092 in the first quarter of 1996, from $4,623
in the first quarter of 1995. The increase is due to the timing of payments for
these expenses during the comparable periods, as the tax rates remained
constant.
(3) Accounting and legal fees increased to $3,323 in the first quarter of 1996,
from $2,123 in the first quarter of 1995 due to the timing of payments for these
expenses during the comparable periods, as the service level remain the same.
(4) Storage, repositioning and other expenses increased to $5,797 in the first
quarter of 1996, from $2,633 in the first quarter of 1995. The increase is
primarily due to the timing of payments of expenses during comparable periods.
Other changes in cash:
(1) Prepaid mileage, reimbursable repairs and other are composed primarily of
receipts of mileage credits from railroads which are due to lessees, net of
reimbursable repairs due from lessees. The funds decreased by $67,020, in the
first quarter of 1996, as compared to an increase of $31,394 in the first
quarter of 1995. The difference between comparable periods is due primarily to
the timing of net receipts and repayments of these funds by the Program.
(2) Management fees paid increased to $68,004 in the first quarter 1996, from
$63,946 in the first quarter of 1995. The increase is due to $11,270 of
incentive fees for net income over $750 per car that was paid in the first
quarter of 1996, as compared to $7,440 that was paid in the first quarter of
1995. In addition, the increase is due to the two cars that were added in the
fourth quarter of 1995 and four cars that were added in the first quarter of
1996.
(3) During the first quarter of 1996, 29 cars were sold for $899,000 for which
IMI received a commission of $35,960. The net proceeds of $863,040 will be paid
to the investors in the second quarter of 1996.
The Program distributed $444,777 to investors in the first quarter 1996, a 5.5%
increase from the comparable period in 1995.
The Program's performance in the first quarter 1996 is not necessarily
indicative of future periods.
Inflation and changing prices did not materially impact the Program's revenues
collected, expenses, and other changes in cash during the reported periods.
<PAGE>
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
RMI COVERED HOPPER RAILCAR
MANAGEMENT PROGRAM 79-1
By: PLM Investment Management, Inc.
Manager
By: /s/ Stephen M. Bess
----------------------------
Stephen M. Bess
President
Date: May 13, 1996 By: /s/ David J. Davis
------------------
David J. Davis
Vice President and
Corporate Controller
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 2,430,995
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 0
<CURRENT-LIABILITIES> 0
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 0
<SALES> 0
<TOTAL-REVENUES> 654,243
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
