UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q/A
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1995
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: 0-11027
SOUTHERN TIMBER PARTNERS I
(formerly Hutton Southern Timber Partners I)
(Exact name of registrant as specified in its charter)
Georgia 56-1303554
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) identification No.)
3 World Financial Center, 29th Floor, New York, NY
ATTN: Andre Anderson 10285
(Address of principal executive offices) (Zip code)
(212) 526-3237
(Registrant's telephone number, including area code)
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
Balance Sheets
June 30, December 31,
Assets 1995 1994
Timber and timberland, at cost $ 8,448,075 $ 9,174,377
Less accumulated depletion (3,814,004) (3,814,004)
Net timber and timberland 4,634,071 5,360,373
Cash and cash equivalents 1,143,109 1,428,986
Accounts receivable - 515,767
Prepaid insurance 17,346 5,922
Due from joint venture 2,893 2,472
Investment in joint venture 1,440,162 1,433,210
Total Assets $ 7,237,581 $ 8,746,730
Liabilities and Partners' Capital
Liabilities:
Accounts payable and accrued expenses $ 32,644 $ 40,189
Due to affiliates 167,262 136,953
Total Liabilities 199,906 177,142
Partners' Capital (Deficit):
General Partner (60,598) (45,263)
Limited Partners (40,000 units outstanding) 7,098,273 8,614,851
Total Partners' Capital 7,037,675 8,569,588
Total Liabilities and Partners' Capital $ 7,237,581 $ 8,746,730
Statement of Partners' Capital (Deficit)
For the six months ended June 30, 1995
General Limited
Partner Partners Total
Balance at December 31, 1994 $(45,263) $ 8,614,851 $ 8,569,588
Distributions (15,353) (1,518,373) (1,533,726)
Net income 18 1,795 1,813
Balance at June 30, 1995 $(60,598) $ 7,098,273 $ 7,037,675
Statements of Operations
Three months ended Six months ended
June 30, June 30,
Income 1995 1994 1995 1994
Timber sales $ - $ 368,619 $ - $ 368,619
Gain (loss) on sales of
timberland (8,648) 66,853 (8,648) 66,853
Interest 37,985 5,046 68,483 9,026
Other 460 625 1,110 1,105
Total Income 29,797 441,143 60,945 445,603
Expenses
Depletion - 155,005 - 155,005
Property operating 22,072 39,913 44,363 93,935
General and administrative 12,014 24,801 21,722 40,249
Total Expenses 34,086 219,719 66,085 289,189
Income (Loss) from
operations (4,289) 221,424 (5,140) 156,414
Other Income (Loss)
Income (Loss) from joint
venture 1,917 (2,019) 6,953 (4,029)
Net Income (Loss) $(2,372) $ 219,405 $ 1,813 $ 152,385
Net Income (Loss) Allocated:
To the General Partner $ (24) $ 2,194 $ 18 $ 1,524
To the Limited Partners (2,348) 217,211 1,795 150,861
$(2,372) $ 219,405 $ 1,813 $ 152,385
Per limited partnership unit
(40,000 outstanding) $ (.06) $ 5.43 $ .04 $ 3.77
Statements of Cash Flows
For the six months ended June 30, 1995 and 1994
Cash Flows from Operating Activities: 1995 1994
Net income $ 1,813 $ 152,385
Adjustments to reconcile net income to net cash
provided by (used for) operating activities:
Depletion - 155,005
(Gain) Loss on sales of timberland 8,648 (66,853)
(Gain) Loss from joint venture (6,953) 4,029
Increase (decrease) in cash arising from
changes
in operating assets and liabilities:
Accounts receivable 515,767 (471,980)
Prepaid Insurance (11,424) -
Due From Joint Venture (421) -
Accounts payable and accrued expenses (7,545) 1,914
Due to affiliates 30,309 (26,393)
Net cash provided by (used for) operating
activities 530,194 (251,893)
Cash Flows from Investing Activities:
Proceeds from sales of timberland 717,655 471,980
Net cash provided by investing activities 717,655 471,980
Cash Flows from Financing Activities:
Distributions (1,533,726) (1,627)
Net cash used for financing activities (1,533,726) (1,627)
Net increase (decrease) in cash and cash
equivalents (285,877) 218,460
Cash and cash equivalents at beginning of
period 1,428,986 649,928
Cash and cash equivalents at end of period $ 1,143,109 $ 868,388
Notes to the Financial Statements
The unaudited interim financial statements should be read in conjunction with
the Partnership's annual 1994 audited financial statements within Form 10-K.
The unaudited financial statements include all adjustments which are, in the
opinion of management, necessary to present a fair statement of financial
position as of June 30, 1995 and the results of operations for the three and
six months ended June 30, 1995 and 1994, cash flows for the six months ended
June 30, 1995 and 1994, and the statement of partners' capital (deficit) for
the six months ended June 30, 1995. Results of operations for the periods are
not necessarily indicative of the results to be expected for the full year.
The following significant events have occurred, or material contingencies
exist, and require disclosure in this interim report per Regulation S-X, Rule
10-01, Paragraph (a)(5).
Reclassifications-Certain prior year amounts have been reclassified to
conform with the financial statement presentation used in 1995.
Part I, Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations.
Liquidity and Capital Resources
Timber and timberland, at cost, decreased by $726,302 from $9,174,377 at
December 31, 1994, to $8,448,075 at June 30, 1995. This decrease is due to the
sale of approximately 1,398 acres of timberland and 4,867 cords of timber from
the Estes tract during the first six months of 1995.
At June 30, 1995, the Partnership's cash balance totalled $1,143,109,
representing a decrease of $285,877 from $1,428,986 at December 31, 1994. The
decrease is primarily the result of the June 30, 1995 payment of a cash
distribution to the limited partners in the amount of $1,520,000, or $38 per
Unit, partially offset by proceeds from timberland sales during the first half
of 1995 and collection of accounts receivable in the first quarter of 1995.
The collection of these accounts receivable is the primary reason for the
$515,767 decrease in the Partnership's accounts receivable balance at June 30,
1995. The Partnership's cash balance, along with funds generated from future
sales of timber and timberland, are expected to provide sufficient liquidity to
enable the Partnership to meet its operating expenses.
Accounts payable and accrued expenses totalled $32,644 at June 30, 1995,
compared to $40,189 at December 31, 1994. The decrease is primarily
attributable to the timing of the payment of the Partnership's annual audit fee
and the payment of the 1994 property appraisal fee.
Due to affiliates increased from $136,953 at December 31, 1994 to $167,262 at
June 30, 1995. The increase is primarily attributable to the accrual of the
Partnership's management fee for the first and second quarters of 1995.
While the long-term trend for timber prices has been upward, prices will
continue to be subject to cyclical fluctuations. Even if timber prices improve
significantly, the Partnership intends to continue to sell timber selectively
since the Estes tract will be more valuable to a potential buyer if it contains
a sizable percentage of merchantable timber.
In addition to timber sales, the General Partner will also continue to pursue
timberland sales on the Estes tract. It should be noted, however, that the
market for raw land in the area of Florida where the tract is located remains
weak. Values may be further undermined in the future by the implementation of
the State Growth Management Act which discourages development of raw land and
tree harvesting. The General Partner will continue to monitor the market
closely in order to obtain maximum value.
The Partnership currently owns approximately 6,400 acres of timberland on the
Estes tract outright and a 24% share in the Laurel View tract, a 1,709 acre
tract located near Savannah, Georgia. While the Laurel View tract could be
sold as timberland, its primary value would be realized if sold as a
development site due to its coastal location and close proximity to major
interstate highways. The General Partner has prepared a land use plan which is
being incorporated into a more comprehensive marketing plan. While
preparations are underway for marketing the tract, it is difficult to predict
when conditions will be best suited for a sale as it largely depends on the
pace of development in the area surrounding the tract.
Results of Operations
The Partnership's operations resulted in a net loss of $2,372 and net income of
$1,813 for the three and six months ended June 30, 1995, respectively, as
compared to net income of $219,405 and $152,385, respectively, for the
corresponding periods in 1994. The decreases in both periods are primarily
attributable to a lack of timber sales during the first six months of 1995.
During the first six months of 1994, the Partnership recorded timber sales of
$368,619, as compared to $0 for the corresponding period in 1995. Also
contributing to the decrease in the Partnership's net income was the
recognition of a loss on sales of timberland during the second quarter of 1995
totalling $8,648, compared to a gain recorded on the sale of timberland for the
corresponding period in 1994 in the amount of $66,853. Partially offsetting
the decrease in net income for the three and six months ended June 30, 1995 was
depletion expense incurred by the Partnership during the second quarter of 1994
totalli ng $155,005. Depletion expense is recorded when timber is harvested
off the timberland tracts. Since the only timber sold in 1995 was included as
part of acreage sales, no depletion expense was recorded.
Interest income totalled $37,985 and $68,483, respectively, for the three and
six months ended June 30, 1995, compared to $5,046 and $9,026, respectively,
for the corresponding periods in 1994. The increases are primarily the result
of a higher cash balance invested during the first six months of 1995 as a
result of timberland sales during the latter part of 1994.
Property operating expenses totalled $22,072 and $44,363, respectively, for the
three and six months ended June 30, 1995, compared to $39,913 and $93,935,
respectively, for the corresponding periods in 1994. The decreases are
primarily due to a decline in management fees and property maintenance
expenses. In 1994, the Partnership incurred costs associated with cruising and
controlled burning on the Estes tract. No such expenses were incurred during
the first six months of 1995. General and administrative expenses for the
three and six months ended June 30, 1995 were $12,014 and $21,722,
respectively, compared to $24,801 and $40,249, respectively, for the
corresponding periods in 1994. The decreases are primarily attributable to a
decrease in advertising expenses incurred by the Partnership during the 1995
periods. During the second quarter of 1994, the Partnership incurred
advertising expenses of approximately $11,000 in connection with auction sales
of timberland from the Estes tract. Also contributing to the decrease in
general and administrative expenses was a decrease in the Partnership's audit
fee.
The Partnership recognized income from Joint Venture operations of $1,917 and
$6,953, respectively, for the three and six months ended June 30, 1995,
compared with losses of $2,019 and $4,029, respectively, for the corresponding
periods in 1994. The joint venture income in 1995 is attributable to income
from sales of timber from the Laurel View tract during the first six months of
1995 in excess of ordinary operating expenses. The joint venture loss in 1994
was attributable to a lack of timber sales and the recording of ordinary
operating expenses.
PART II OTHER INFORMATION
Items 1-5 Not applicable
Item 6 Exhibits and reports on Form 8-K.
(a) Exhibits - None
(b) Reports on Form 8-K - No reports on Form 8-K were filed
during the quarter ended June 30, 1995.
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.
SOUTHERN TIMBER PARTNERS I
BY: SOUTHERN TIMBER RESOURCES CORP.
General Partner
Date: August 11, 1995
BY: /s/ Paul L. Abbott
Paul L. Abbott
Director, President and
Chief Financial Officer
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