United States Securities and Exchange Commission
Washington, D.C. 20549
FORM 10-Q
(Mark One)
X Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the Quarterly Period Ended September 30, 1996
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
Exact Name of Registrant as Specified in its Charter
Georgia 56-1303554
State or Other Jurisdiction of
Incorporation or Organization I.R.S. Employer 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 At September 30, At December 31,
1996 1995
Assets
Timber and timberland, at cost: $6,987,505 $6,987,505
Less accumulated depletion (2,806,428) (2,806,428)
4,181,077 4,181,077
Cash and cash equivalents 497,494 1,683,209
Prepaid insurance 3,918 4,813
Due from related parties _ 8,250
Investment in joint venture 1,429,775 1,435,654
Total Assets $6,112,264 $7,313,003
Liabilities and Partners' Capital
Liabilities:
Accounts payable and accrued expenses $32,055 $23,854
Due to affiliates 149,301 201,624
Total Liabilities 181,356 225,478
Partners' Capital (Deficit):
General Partner (56,829) (45,263)
Limited Partners (40,000 units outstanding) 5,987,737 7,132,788
Total Partners' Capital 5,930,908 7,087,525
Total Liabilities and Partners' Capital $6,112,264 $7,313,003
Statement of Partners' Capital (Deficit)
For the nine months ended September 30, 1996 Limited General
Partners Partner Total
Balance at December 31, 1995 $7,132,788 $(45,263) $7,087,525
Distributions (1,080,090) (10,910) (1,091,000)
Net loss (64,961) (656) (65,617)
Balance at September 30, 1996 $5,987,737 $(56,829) $5,930,908
Statements of Operations Three months ended Nine months ended
September 30, September 30,
1996 1995 1996 1995
Income
Gain on sales of timberland $ _ $13,337 $ _ $4,689
Interest 12,419 17,675 57,300 86,158
Other 170 500 2,980 1,610
Total income 12,589 31,512 60,280 92,457
Expenses
Property operating 17,491 21,822 54,929 66,185
General and administrative 34,125 37,350 65,089 59,072
Total expenses 51,616 59,172 120,018 125,257
Loss from operations (39,027) (27,660) (59,738) (32,800)
Other Income (Loss)
Income (loss) from joint venture (1,773) (2,232) (5,879) 4,721
Net Loss $(40,800) $(29,892) $(65,617) $(28,079)
Net Loss Allocated:
To the General Partner $(408) $(299) $(656) $(281)
To the Limited Partners (40,392) (29,593) (64,961) (27,798)
$(40,800) $(29,892) $(65,617) $(28,079)
Per limited partnership unit
(40,000 outstanding) $(1.01) $(.74) $(1.62) $(.70)
Statements of Cash Flows
For the nine months ended September 30, 1996 1995
Cash Flows From Operating Activities
Net loss $(65,617) $(28,079)
Adjustments to reconcile net loss to net cash
provided by (used for) operating activities:
Gain on sales of timberland _ (4,689)
(Income) loss from joint venture 5,879 (4,721)
Increase (decrease) in cash arising from changes in
operating assets and liabilities:
Accounts receivable _ 515,767
Prepaid insurance 895 (7,828)
Due from related parties 8,250 2,472
Accounts payable and accrued expenses 8,201 25,392
Due to affiliates (52,323) 45,334
Net cash provided by (used for) operating activities (94,715) 543,648
Cash Flows From Investing Activities
Proceeds from land sales _ 963,384
Net cash provided by investing activities _ 963,384
Cash Flows From Financing Activities
Distributions (1,091,000) (1,533,726)
Net cash used for financing activities (1,091,000) (1,533,726)
Net decrease in cash and cash equivalents (1,185,715) (26,694)
Cash and cash equivalents, beginning of period 1,683,209 1,428,986
Cash and cash equivalents, end of period $497,494 $1,402,292
Notes to the Financial Statements
The unaudited interim financial statements should be read in
conjunction with the Partnership's annual 1995 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 September 30, 1996 and the
results of operations for the three and nine months ended
September 30, 1996 and 1995, the statements of cash flows for the
nine months ended September 30, 1996 and 1995 and the statement
of partners' capital (deficit) for the nine months ended
September 30, 1996. Results of operations for the period are not
necessarily indicative of the results to be expected for the full
year.
No significant events have occurred subsequent to fiscal year
1995, and no material contingencies exist which would require
disclosure in this interim report per Regulation S-X, Rule 10-01,
Paragraph (a)(5).
Part I, Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.
Liquidity and Capital Resources
At September 30, 1996, the Partnership's cash balance totaled $497,494,
compared to $1,683,209 at December 31, 1995. The decrease is mainly
due to the payment of a cash distribution on August 9, 1996, in the
amount of $1,091,000, or $27.00 per Unit. 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 at September 30, 1996 were
$32,055, compared to $23,854 at December 31, 1995. The increase is
primarily attributable to an accrual of nine months of the estimated
1996 real estate taxes.
Due to affiliates was $149,301 at September 30, 1996, compared to
$201,624 at December 31, 1995. The decrease is primarily
attributable to the payment of accrued management fees.
The Partnership currently owns approximately 5,947 acres of timberland
on the Estes tract outright and a 24% share in the Laurel View tract
(the "Joint Venture"), a 1,709 acre tract located near Savannah,
Georgia. While the Laurel View tract could be sold as timberland,
its greater 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 begun actively marketing the
Laurel View tract, together with Southern Timber Partners 2, an
affiliated Partnership which owns a 76% interest in the tract.
On February 6, 1996, the Partnership executed a purchase and sale
agreement with the State of Florida for a sale of 1,290 acres of the
Estes Tract. On March 6, 1996, the Partnership entered into a
second purchase and sale agreement with the State of Florida for a
sale of the remainder of the Estes Tract. The sales are pending
completion of a mineral rights survey mandated by the State of
Florida. Although the sales are expected to close by the end of the
year, the sales agreements can be rescinded by the State of Florida
at any time, and therefore, there can be no assurance either sale
will occur.
It is uncertain whether the Partnership will complete a sale of the
Laurel View tract prior to the Partnership's originally intended
termination date, December 31, 1996. If the General Partner is
unable to secure a buyer for the Laurel View Tract before that time,
or should the sale of the Estes Tract to the State of Florida not be
completed before the end of the year, the General Partner may extend
the life of the Partnership beyond the termination date if it is
determined that a sale of the Partnership's assets at that time
would not result in a reasonable price. Therefore, the General
Partner will proceed with efforts to insure that the Partnership's
assets are liquidated in a manner that will be most favorable to the
limited partners.
Results of Operations
The Partnership's operations resulted in net losses of $40,800 and
$65,617 for the three and nine months ended September 30, 1996,
respectively, as compared to net losses of $29,892 and $28,079 for
the corresponding periods in 1995. The higher net loss for the
three-month period ended September 30, 1996 is mainly attributable
to the recognition of a gain on sales of timberland in 1995 and a
decrease in interest income in 1996. The higher net loss for the
nine-month period is primarily attributable to lower interest income
in 1996 and the recognition of a loss from joint venture operations
in 1996 as opposed to income from joint venture operations in 1995.
Interest income totaled $12,419 and $57,300 for the three and nine
months ended September 30, 1996, respectively, compared to $17,675
and $86,158 for the corresponding periods in 1995. The decrease for
both periods is primarily the result of a lower average cash balance
in 1996.
Property operating expenses were $17,491 and $54,929 for the three and
nine months ended September 30, 1996, compared to $21,822 and
$66,185 for the corresponding periods in 1995. The decreases are
due to lower management fees and lower real estate tax expenses in
1996.
General and administrative expenses for the three and nine months ended
September 30, 1996 were $34,125 and $65,089, respectively, compared
to $37,350 and $59,072 for the same periods in 1995. The increase
for the nine-month period is primarily due to higher audit and other
professional fees, and was partially offset by lower legal fees.
The Partnership recognized losses from Joint Venture of $1,773 and
$5,879 for the three and nine months ended September 30, 1996,
compared with a loss from Joint Venture of $2,232 and income from
Joint Venture of $4,721 for the three and nine months ended
September 30, 1995. The Joint Venture income in the nine months
ended September 30, 1995 is attributable to income from timber sales
recognized in the first half of 1995 in excess of ordinary operating
expenses. The joint venture losses in 1996 and the three months
ended September 30, 1995 are 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 -
(27) Financial Data Schedule
(b) Reports on Form 8-K - No reports on Form 8-K
were filed during the quarter ended September 30,
1996.
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: November 12, 1996 BY: /s/ Paul L. Abbott
Director and Chief Executive Officer
Date: November 12, 1996 BY: /s/ Robert J. Hellman
President and Chief Financial Officer
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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<FISCAL-YEAR-END> Dec-31-1996
<PERIOD-END> Sept-30-1996
<CASH> 497,494
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
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<CURRENT-ASSETS> 501,412
<PP&E> 6,987,505
<DEPRECIATION> 2,806,428
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<OTHER-SE> 5,930,908
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<TOTAL-REVENUES> 60,280
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<OTHER-EXPENSES> 65,089
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<INCOME-PRETAX> (65,617)
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<INCOME-CONTINUING> (65,617)
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<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (65,617)
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