<PAGE> 1
SECURITIES & EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended September 30, 1996 Commission File #0-9305
REEVES TELECOM LIMITED PARTNERSHIP
(name changed from Reeves Telecom Associates)
- -----------------------------------------------------------------
South Carolina 57-0700063
- ----------------------- -----------------------------
(State of Incorporation) (I.R.S. Employer I.D. Number)
c/o Grace Property Management Inc.
P. O. Box 163
55 Brookville Road
Glen Head, New York 11545
- -----------------------------------------------------------------
(Address of General Partner) (Zip Code)
Registrants telephone number (516) 686-2201
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> 2
PART 1. FINANCIAL INFORMATION
REEVES TELECOM LIMITED PARTNERSHIP
BALANCE SHEET
<TABLE>
<CAPTION>
September 30, December 31,
Assets 1996 1995
(UNAUDITED) (AUDITED)
----------- ---------
<S> <C> <C>
Current Assets:
Cash and cash equivalents $153,109 $ 73,860
Land held for development or sale
and related buildings and
equipment, net 805,830 910,183
Other assets 24,036 1,201
-------- --------
$982,975 $985,244
======== ========
Liabilities and Partners' Capital
Current Liabilities:
Accounts payable and
accrued expenses $668,396 $527,233
Notes payable - Current
portion 20,448 4,234
-------- --------
688,844 531,467
Notes payable - Non-Current
portion 196,348 172,945
-------- --------
Total Liabilities 885,192 704,412
Partners' capital 97,783 280,832
-------- --------
$982,975 $985,244
======== ========
</TABLE>
<PAGE> 3
REEVES TELECOM LIMITED PARTNERSHIP
STATEMENT OF OPERATIONS AND PARTNERS' CAPITAL
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
(Unaudited)
<TABLE>
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
Operating revenues:
Land sales $ 353,345 $ 163,712
Fox Squirrel income 275,626 253,550
Interest income 2,310 1,418
Other income and sale of timber 11,902 9,693
--------- ---------
643,183 428,373
--------- ---------
Operating Costs and Expenses:
Administrative 591,283 420,060
Direct cost of land sold 191,168 83,493
Depreciation 43,781 28,190
--------- ---------
826,232 531,743
--------- ---------
Net Income or (Loss) (183,049) (103,370)
Partners' capital at beginning
of period 280,832 420,776
--------- ---------
Partners' capital at end of
period $ 97,783 $ 317,406
========= =========
Income or (Loss) per partnership unit
(1,828,258 units outstanding as of
September 30, 1996 and 1995
respectively.) $ (0.10) $ (0.06)
========= =========
</TABLE>
<PAGE> 4
REEVES TELECOM LIMITED PARTNERSHIP
STATEMENT OF OPERATIONS AND PARTNERS' CAPITAL
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
(Unaudited)
<TABLE>
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
Operating revenues:
Land sales $ 86,707 $ 52,105
Fox Squirrel income 82,604 97,628
Interest income 1,314 791
Other income and sale of timber 4,662 905
--------- ---------
175,287 151,429
--------- ---------
Operating Costs and Expenses:
Administrative 190,673 137,617
Direct cost of land sold 46,962 26,393
Depreciation 15,247 10,175
--------- ---------
252,882 174,185
--------- ---------
Net Income or (Loss) (77,595) (22,756)
Partners' capital at beginning
of period 175,378 340,162
--------- ---------
Partners' capital at end of
period $ 97,783 $ 317,406
========= =========
Income or (Loss) per partnership unit
(1,828,258 units outstanding as of
September 30, 1996 and 1995
respectively.) $ (0.04) $ (0.01)
========= =========
</TABLE>
<PAGE> 5
REEVES TELECOM LIMITED PARTNERSHIP
STATEMENT OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
(Unaudited)
<TABLE>
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
CASH PROVIDED BY OPERATIONS:
Net Income or (Loss) $(183,049) $(103,370)
Deduct Items Not Using Cash:
Depreciation 43,781 28,190
--------- ---------
TOTAL (139,268) (75,180)
--------- ---------
CHANGES IN OPERATING ASSETS AND LIABILITIES
INCREASING OR (DECREASING) CASH:
(Increase) in other assets (22,835) --
Decrease in receivables -- 1,291
Decrease in Land held for
development or sale 191,168 83,493
Increase or (decrease) in accounts
payable and accrued expenses 141,163 (44,650)
(Decrease) in notes payable (42,593) --
--------- ---------
266,903 40,134
--------- ---------
NET CASH PROVIDED OR (USED) BY
OPERATIONS $ 127,635 $ (35,046)
CASH (USED) BY INVESTING ACTIVITIES:
Additions to Fixed Assets (130,599) (215,479)
CASH FROM FINANCING ACTIVITIES:
Proceeds from note payable -- 200,000
Equipment note payable 82,213 --
--------- ---------
NET INCREASE OR (DECREASE) IN CASH $ 79,249 $ (50,525)
========= =========
CASH BALANCE - BEGINNING $ 73,860 $ 137,549
NET INCREASE OR (DECREASE) IN
CASH, AS ABOVE 79,249 (50,525)
--------- ---------
CASH BALANCE - ENDING $ 153,109 $ 87,024
========= =========
</TABLE>
<PAGE> 6
REEVES TELECOM LIMITED PARTNERSHIP
STATEMENT OF CASH FLOWS
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
(Unaudited)
<TABLE>
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
CASH PROVIDED BY OPERATIONS:
Net Income or (Loss) $ (77,595) $ (22,756)
Deduct Items Not Using Cash:
Depreciation 15,247 10,175
--------- ---------
TOTAL (62,348) (12,581)
--------- ---------
CHANGES IN OPERATING ASSETS AND LIABILITIES
INCREASING OR (DECREASING) CASH:
(Increase) or decrease in other assets 2,582 --
Decrease in receivables -- 296
Decrease in Land held for
development or sale 46,962 26,393
Increase or (decrease) in accounts
payable and accrued expenses 56,248 (29,483)
(Decrease) in notes payable (9,933) --
--------- ---------
95,859 (2,794)
--------- ---------
NET CASH PROVIDED OR (USED) BY
OPERATIONS $ 33,511 $ (15,375)
CASH (USED) BY INVESTING ACTIVITIES:
Additions to Fixed Assets (36,156) (27,253)
CASH FROM FINANCING ACTIVITIES:
Proceeds from note payable -- --
Equipment note payable -- --
--------- ---------
NET INCREASE OR (DECREASE) IN CASH $ (2,645) $ (42,628)
========= =========
CASH BALANCE - BEGINNING $ 155,754 $ 129,652
NET INCREASE OR (DECREASE) IN
CASH, AS ABOVE (2,645) (42,628)
--------- ---------
CASH BALANCE - ENDING $ 153,109 $ 87,024
========= =========
</TABLE>
<PAGE> 7
REEVES TELECOM LIMITED PARTNERSHIP
SEPTEMBER 30, 1996
(Unaudited)
ITEM 2. Management Discussion and Analysis of Financial
Condition and Results of Operations.
The Partnership is a liquidating partnership and as such,
quarter to quarter comparisons and analysis are not
meaningful.
For the nine months ended September 30, 1996 and 1995, the
Partnership generated revenues from land sales of $353,345 and
$163,712, respectively. Revenues in 1996 included the sale of
a tract of approximately 430 acres for $85,000. Excluding such
sale, the Partnership sold 37 individual lots, generating
aggregate revenues of $268,345 compared to 28 lots and
$163,712 in land sale revenues for the same period one year
ago. Management attributes the increase largely to somewhat
improved economic conditions locally and to the relative mix
of lots sold as to location and asking price. Individual lots
adjacent to or near the golf course, for example, generally
command a higher asking price than lots which are not so
situated.
Revenues at Fox Squirrel Country Club ("Fox Squirrel") for the
nine months ended September 30, 1996 and 1995 were $275,626
and $253,550 respectively. Higher cart rental income,
principally due to more rounds of golf played by nonmembers,
more than offset the elimination of concession income, which
was a result of an improved dining service. Greens fees were
lower than in the same period last year largely due to poor
weather conditions in September relating to Hurricane Fran.
That hurricane significantly effected the coastal regions of
North and South Carolina, causing extensive flooding and
considerable damage. Locally, extensive flooding and the
downing of numerous trees and large branches caused the
closing of the golf course at Fox Squirrel for six days.
Direct operating expenses at Fox Squirrel for the nine months
ended September 30, 1996 and 1995 were $255,323 and $217,028
respectively. The increase is substantially attributable to
higher maintenance expense relating to the golf course and the
club house.
Income from the dining service was $3,140 through September
30, 1996, compared to $5,205 for the same period in 1995. The
decline reflects the temporary waiver of rent by the
Partnership to assist the operator of the dining service, who
has experienced lower revenues than anticipated.
<PAGE> 8
REEVES TELECOM LIMITED PARTNERSHIP
SEPTEMBER 30, 1996
(Unaudited)
Revenue from tree cutting through September 30, 1996 was
$11,881, compared to revenue of $4,488 in the same period in
1995. As stated in recent financial reports, Management has
viewed timber cutting as a source of temporary revenue with
limited prospects in the future due to, among other factors,
the size and number of trees which may be logged, the demand
for wood pulp, and market prices in general. As such,
Management expects revenue from tree cutting to be highly
variable from quarter to quarter.
Direct cost of land sold during the nine months ended
September 30, 1996 and 1995 was $191,168 and $83,493,
respectively. The increase is attributable largely to the sale
of the approximately 430 acre tract of land.
To provide funds for working capital and other purposes, on
June 1, 1995 the Partnership borrowed $200,000 from the
president of the General Partner, payable in full on June 1,
1998. The promissory note issued bears interest at a rate
equal to 6% above 12-month LIBOR, requires interest to be paid
quarterly commencing September 1, 1995, and allows for
prepayment without penalty. The promissory note is secured by
a mortgage on Fox Squirrel. As of September 30, 1996, $60,000
of the principal has been repaid under the terms of the
promissory note allowing for prepayment of principal without
penalty, leaving an outstanding balance of $140,000.
The improvements made at Fox Squirrel are representative of
the Partnership's continuing efforts to improve the
development at Boiling Spring Lakes so that the Partnership
will eventually be able to consistently generate revenues in
excess of operating expenses and capital expenditures.
Management believes, however, that the variable nature of the
Partnership's revenues and its current liquidity position
raise doubts about the Partnership's ability to fund its
operations and currently planned capital programs without
obtaining additional financing. Management is not certain that
additional outside financing is available and, if available,
that such financing may be obtained on terms Management
believes to be acceptable.
<PAGE> 9
REEVES TELECOM LIMITED PARTNERSHIP
SEPTEMBER 30, 1996
(Unaudited)
PART II OTHER INFORMATION
ITEM 6. Exhibits and Reports on Form 8-K
The Partnership filed no reports on Form 8-K for the quarter ended
September 30, 1996
<PAGE> 10
REEVES TELECOM LIMITED PARTNERSHIP
SEPTEMBER 30, 1996
(Unaudited)
SIGNATURE
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, thereto duly authorized.
REEVES TELECOM LIMITED PARTNERSHIP
By: Grace Property Management, Inc.
General Partner
By:/S/ JOHN S. GRACE
-----------------------------
John S. Grace
President
Dated: November 5, 1996
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 153,109
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 153,109
<PP&E> 805,830
<DEPRECIATION> 0
<TOTAL-ASSETS> 982,975
<CURRENT-LIABILITIES> 688,844
<BONDS> 196,348
0
0
<COMMON> 97,783
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 982,975
<SALES> 353,345
<TOTAL-REVENUES> 643,183
<CGS> 191,168
<TOTAL-COSTS> 826,232
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (183,049)
<INCOME-TAX> 0
<INCOME-CONTINUING> (183,049)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (183,049)
<EPS-PRIMARY> (0.10)
<EPS-DILUTED> 0
</TABLE>
