FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 or 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For quarterly period ended September 30, 1997
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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 1-8254
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THACKERAY CORPORATION
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(Exact Name of Registrant as Specified in Its Charter)
Delaware 04-2446697
- ------------------------------- ----------------
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
400 Madison Ave.
Suite 1508
New York, New York 10017
- ---------------------------------------- ----------
(Address of Principal Executive Offices) (Zip Code)
(212) 759-3695
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(Registrant's telephone number, including area code)
Unchanged
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(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 [ ]
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date: 5,107,401 shares of common
stock, $.10 par value, as of November 4, 1997.
NYFS07...:\55\69555\0001\1708\FRMN057K.290
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1 - Financial Statements
THACKERAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
SEPTEMBER 30, 1997 AND DECEMBER 31, 1996
1997 1996
---- ----
ASSETS: (UNAUDITED)
CASH AND CASH EQUIVALENTS $5,398,000 $4,615,000
RECEIVABLES FROM REAL ESTATE PARTNERSHIP 389,000 198,000
INVESTMENTS IN REAL ESTATE 5,756,000 5,756,000
OTHER ASSETS, NET 232,000 315,000
----------- ----------
TOTAL ASSETS $11,775,000 $10,884,000
=========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY:
ACCOUNTS PAYABLE AND ACCRUED EXPENSES $190,000 $100,000
ACCRUED INCOME AND OTHER TAXES 306,000 308,000
OTHER LIABILITIES 128,000 128,000
----------- ----------
TOTAL LIABILITIES 624,000 536,000
----------- ----------
STOCKHOLDERS' EQUITY:
COMMON STOCK, $.10 PAR VALUE
(20,000,000 SHARES AUTHORIZED;
6,187,401 SHARES ISSUED) 619,000 619,000
CAPITAL IN EXCESS OF PAR VALUE 53,424,000 53,424,000
ACCUMULATED DEFICIT (32,902,000) (33,705,000)
TREASURY STOCK (1,080,000 SHARES) (9,990,000) (9,990,000)
----------- ----------
TOTAL STOCKHOLDERS' EQUITY 11,151,000 10,348,000
----------- ----------
TOTAL LIABILITIES & STOCKHOLDERS' EQUITY $11,775,000 $10,884,000
=========== ===========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE BALANCE SHEETS.
2
<PAGE>
THACKERAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
(UNAUDITED) 1997 1996
---- ----
REVENUES FROM REAL ESTATE OPERATIONS:
RENTAL AND MORTGAGE INCOME $48,000 $53,000
SALES OF REAL ESTATE, NET 0 2,159,000
--------- ---------
TOTAL REAL ESTATE REVENUES 48,000 2,212,000
--------- ---------
EXPENSES OF REAL ESTATE OPERATIONS:
PROPERTY CARRYING COSTS INCLUDING
REAL ESTATE TAXES 0 110,000
COST OF PROPERTY SOLD 0 1,150,000
--------- ---------
TOTAL REAL ESTATE EXPENSES 0 1,260,000
--------- ---------
INCOME FROM REAL ESTATE OPERATIONS 48,000 952,000
--------- ---------
GENERAL AND ADMINISTRATIVE EXPENSES 295,000 327,000
INTEREST INCOME, NET (192,000) (119,000)
GAIN ON SALE OF INVESTMENT 873,000 0
--------- ---------
INCOME BEFORE INCOME TAXES 818,000 744,000
INCOME TAXES 15,000 0
--------- ---------
NET INCOME $803,000 $744,000
========= =========
INCOME PER SHARE $0.16 $0.15
===== =====
NUMBER OF SHARES 5,107,401 5,107,401
========= =========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.
3
<PAGE>
THACKERAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
FOR THE THREE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
(UNAUDITED) 1997 1996
---- ----
REVENUES FROM REAL ESTATE OPERATIONS:
RENTAL AND MORTGAGE INCOME $16,000 $18,000
SALES OF REAL ESTATE 0 2,159,000
--------- ---------
TOTAL REAL ESTATE REVENUES 16,000 2,177,000
--------- ---------
EXPENSES OF REAL ESTATE OPERATIONS:
PROPERTY CARRYING COSTS INCLUDING
REAL ESTATE TAXES 0 1,000
COST OF PROPERTY SOLD 0 1,150,000
--------- ---------
TOTAL REAL ESTATE EXPENSES 0 1,151,000
--------- ---------
INCOME FROM REAL ESTATE OPERATIONS 16,000 1,026,000
--------- ---------
GENERAL AND ADMINISTRATIVE EXPENSES 86,000 96,000
INTEREST INCOME, NET (67,000) (45,000)
GAIN ON SALE OF INVESTMENT 873,000 0
--------- ---------
INCOME BEFORE INCOME TAXES 870,000 975,000
INCOME TAXES 15,000 0
--------- ---------
NET INCOME $855,000 $975,000
========= =========
INCOME PER SHARE $0.17 $0.19
===== =====
NUMBER OF SHARES 5,107,401 5,107,401
========= =========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.
4
<PAGE>
THACKERAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1997 AND 1996
(UNAUDITED) 1997 1996
---- ----
CASH FLOWS FROM OPERATING ACTIVITIES:
NET INCOME $803,000 $744,000
ADJUSTMENTS TO RECONCILE NET INCOME TO NET
CASH PROVIDED BY OPERATING ACTIVITIES:
GAIN ON SALE OF REAL ESTATE 0 (1,009,000)
GAIN ON SALE OF INVESTMENT (873,000) 0
DEPRECIATION AND AMORTIZATION 3,000 11,000
CHANGES IN ASSETS AND LIABILITIES:
INCREASE IN RECEIVABLES FROM REAL
ESTATE PARTNERSHIP (191,000) (139,000)
INCREASE IN ACCOUNTS PAYABLE AND
ACCRUED LIABILITIES 88,000 129,000
OTHER, NET (36,000) (144,000)
--------- ---------
NET CASH FLOWS USED IN OPERATING ACTIVITIES (206,000) (408,000)
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
PROCEEDS FROM SALE OF REAL ESTATE 102,000 2,159,000
PROCEEDS FROM SALE OF INVESTMENT 887,000 0
--------- ---------
NET CASH FLOWS PROVIDED BY INVESTING ACTIVITIES 989,000 2,159,000
--------- ---------
INCREASE IN CASH AND CASH EQUIVALENTS 783,000 1,751,000
CASH AND CASH EQUIVALENTS - BEGINNING OF PERIOD 4,615,000 3,020,000
--------- ---------
CASH AND CASH EQUIVALENTS - END OF PERIOD $5,398,000 $4,771 000
========= =========
THE ACCOMPANYING NOTES ARE AN INTEGRAL PART OF THESE STATEMENTS.
5
<PAGE>
THACKERAY CORPORATION AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 1997 and 1996
(UNAUDITED)
1. BASIS OF PRESENTATION
The significant accounting policies followed by the Company in the
preparation of these unaudited interim financial statements are consistent
with the accounting policies followed in the audited annual financial
statements. In the opinion of management, all adjustments (consisting of
normal recurring accruals) considered necessary for a fair presentation
have been included.
Certain information and footnote disclosures included in the annual
audited financial statements have been omitted. For additional
information, reference is made to the financial statements and notes
thereto included in the Company's Annual Report to Stockholders for the
year ended December 31, 1996.
The net income applicable to common stock for the nine month and three
month periods ended September 30, 1997 and 1996 were divided by the number
of shares outstanding during the periods to determine per share data.
2. INCOME TAXES
The Company anticipates it will generate a Federal taxable income for the
year ended December 31, 1997. As a result however of the existence of net
operating loss carryforwards, it expects that no Federal income taxes will
be payable for such year, except for alternative minimum taxes. For the
full year 1996, available net operating loss carryforwards were in excess
of Federal taxable income. Accordingly, for the nine month and three month
periods ended September 30, 1997, the Federal income tax provision has
been eliminated through the utilization of such loss carryforwards, except
for alternative minimum taxes.
3. STATEMENTS OF CASH FLOWS
There were no interest payments during the nine months ended September 30,
1997 and 1996.
Income tax payments, which consisted primarily of alternative minimum
taxes, during the nine months ended September 30, 1997 totaled $16,000.
6
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations
(1) Material Changes in Financial Condition
The Company anticipates that its current cash balance will be
sufficient to fund its requirements for the foreseeable future.
At September 30, 1997 the Company had no material commitments for
capital expenditures.
(2) Material Changes in Results of Operations
Total real estate revenues for the nine months ended September 30,
1997 were $48,000 versus $2,212,000 for the comparable period in 1996,
which included proceeds from the sale of real estate of $2,159,000.
There were no property carrying costs incurred in 1997 versus
$1,260,000 for the first nine months of 1996. The 1996 amount includes
$1,150,000 cost of property sold, which did not recur in 1997. The
decrease in real estate taxes results from the Partnership Agreement with
Belz Enterprises, wherein certain expenditures of the related property are
paid by the Company, but are charged to the Partnership. During the nine
months ended September 30, 1997 and 1996 there were $191,000 and $139,000,
respectively, of such expenditures charged to the Partnership.
General and administrative expenses decreased by $32,000 or 9.8%
from amounts reported in the first nine months of 1996. The decrease was
primarily in professional costs.
Interest income for the nine months ended September 30, 1997 was
$192,000 versus $119,000 for the comparable period in 1996. The increase
relates to a higher level of cash equivalents resulting from the sale in
August 1996, of certain real estate property, and the sale in August 1997
of an investment.
In August 1997, the Company sold its remaining investment in a
privately owned company for $887,000. The carrying value of such
investment, at cost, was $14,000.
7
<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
27 Financial Data Schedule
(b) Reports on Form 8-K
The Company did not file any Current Reports on Form 8-K, during the
quarter ended September 30, 1997.
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.
THACKERAY CORPORATION
By: /s/ Jules Ross
--------------------------------
Jules Ross
Vice President, Finance,
(Principal Financial Officer)
Date: November 4, 1997
8
<PAGE>
EXHIBIT INDEX
Exhibit No. Description
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27 Financial Data Schedule
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
financial statements contained in the body of the accompanying Form 10-Q and is
qualified in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> SEP-30-1997
<CASH> 5,398,000
<SECURITIES> 0
<RECEIVABLES> 389,000
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 11,775,000
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 619,000
<OTHER-SE> 10,532,000
<TOTAL-LIABILITY-AND-EQUITY> 11,775,000
<SALES> 0
<TOTAL-REVENUES> 921,000
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 295,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (192,000)
<INCOME-PRETAX> 0
<INCOME-TAX> 15,000
<INCOME-CONTINUING> 803,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 803,000
<EPS-PRIMARY> .16
<EPS-DILUTED> .16
</TABLE>
