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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 March 31, 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 0-11431
New Energy Company of Indiana Limited Partnership
(formerly, New Energy Company of Indiana)
(Exact name of registrant as specified in its charter)
Indiana 52-1195762
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
3201 West Calvert Street, South Bend, Indiana 46613
(Address of principal executive offices)
(Zip Code)
219-233-3116
(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 _
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PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
NEW ENERGY COMPANY OF INDIANA LIMITED PARTNERSHIP
BALANCE SHEETS
MARCH 31, 1995 DECEMBER 31, 1994
Assets (UNAUDITED) (AUDITED)
Current assets:
Cash and cash equivalents $ 12,546,323 $ 8,879 804
Accounts receivable 4,396,306 8,025,818
Other receivables 195,899 77,952
Inventories 2,953,453 4,453,276
Spare parts 2,628,981 2,611,001
Prepaid expenses and other 735,987 346,247
Total current assets 23,456,949 24,394,098
Property, plant and equipment 159,235,018 159,159,336
Accumulated depreciation (deduction) (132,121,122) (131,470,902)
27,113,896 27,688,434
Total assets $ 50,570,845 $ 52,082,532
=========== ===========
Liabilities and partners'
capital deficit
Current liabilities:
Accounts payable $ 2,454,734 $ 3,204,488
Interest payable 53,894 342,522
Taxes payable 2,064,372 1,642,124
Other accrued liabilities 1,106,002 905,467
Current portion of long-term debt 9,928,864 12,795,098
Total current liabilities 15,607,866 18,889,699
Deferred management fees payable
to general partner 510,737 1,100,188
Long-term debt, less current portion 67,315,283 68,996,610
Partners' capital (deficit):
General partner (4,869,154) (5,273,246)
Limited partners (28,470,840) (32,107,672)
Special limited partner 5,000,000 5,000,000
Syndication costs (4,523,047) (4,523,047)
Total partners' capital deficit (32,863,041) (36,903,965)
Total liabilities and ___________ ___________
partners' capital deficit $ 50,570,845 $ 52,082,532
=========== ===========
See notes to financial statements.
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NEW ENERGY COMPANY OF INDIANA LIMITED PARTNERSHIP
STATEMENTS OF OPERATION
THREE MONTHS ENDED THREE MONTHS ENDED
MARCH 31, 1995 MARCH 31, 1994
(UNAUDITED) (UNAUDITED)
Net sales, ethanol $ 25,862,615 $ 22,398,192
By-product revenue 7,166,405 8,092,910
33,029,020 30,491,102
Cost of goods sold 26,102,946 32,559,414
Gross profit (loss) 6,926,074 2,068,312
Selling, general and
administrative expenses 1,907,006 1,913,303
Income (loss) from operations 5,019,068 (3,981,615)
Interest income 122,995 73,374
Interest expense (1,101,139) (1,250,050)
Net income (loss) $ 4,040,924 $ (5,158,291)
========== ==========
Net income (loss) allocable to
limited partners $ 3,636,832 $ (4,642,461)
========== ==========
Limited partner units
outstanding 6,400 6,400
========== ==========
Net income (loss) per unit $ 568 $ (725)
========== ==========
See notes to financial statements.
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NEW ENERGY COMPANY OF INDIANA LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS
THREE THREE
MONTHS ENDED MONTHS ENDED
MARCH 31, 1995 MARCH 31, 1994
(UNAUDITED) (UNAUDITED)
Operating activities
Net income (loss) $ 4,040,924 $(5,158,291)
Adjustments to reconcile net income
(loss) to net cash provided by
(used in) operating activities:
Depreciation and amortization 650,220 3,361,515
Decrease in deferred management
fees payable to general partner (589,451) (43,714)
Increase in accrued interest on
general partner loan 133,286 133,286
Increase (decrease) due to changes
in operating assets and liabilities:
Accounts and other receivables 3,511,565 (466,712)
Inventories 1,499,823 1,558,254
Spare parts (17,980) (62,551)
Prepaid expenses and other (389,740) (159,445)
Accounts payable (749,754) 697,449
Interest payable (288,628) 86,947
Taxes payable 422,248 (404,011)
Other accrued liabilities 200,535 71,031
Net cash provided by (used in) operating
activities 8,423,048 (386,242)
Investing activities
Purchase of property and equipment (75,682) (65,233)
Net cash used in investing activities (75,682) (65,233)
Financing activities
Payments of long-term debt (4,680,847) (1,792,656)
Capital contributions from limited
partners --- 300
Net cash used in financing activities (4,680,847) (1,792,356)
Increase (decrease) in cash and cash
equivalents 3,666,519 (2,243,831)
Cash and cash equivalents, beginning of
period 8,879,804 10,137,036
Cash and cash equivalents, end of period $12,546,323 $ 7,893,205
========== ==========
See notes to financial statements.
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New Energy Company of Indiana Limited Partnership
Notes to Financial Statements
For the Quarter Ended March 31, 1995 (Unaudited)
1. ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES
The accompanying unaudited condensed financial statements have
been prepared in accordance with generally accepted accounting
principles for interim financial information and with the
instructions to Form 10-Q and Rule 10-01 of Regulation S-X.
Accordingly, they do not include all of the information and
footnotes required by generally accepted accounting principles for
complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation have been included. For further
information, refer to the financial statements and footnotes
thereto included in the Company's annual report on Form 10-K for
the year ended December 31, 1994.
2. INVENTORIES
Inventories consist of raw materials (corn, coal, unleaded
gasoline and chemicals), work-in-process and finished goods (fuel
grade ethanol and DDGS). A summary of inventories by classifica-
tion follows:
March 31, 1995 December 31, 1994
Raw materials $1,000,949 $2,251,812
Work-in-process 487,480 434,505
Finished goods 1,465,024 1,766,959
$2,953,453 $4,453,276
========= =========
For the years 1994 and 1995 the Company executed contracts with a
grain supplier to provide its expected corn requirements at a price
which may fluctuate with the commodity prices or be fixed at the
Company's election. As of May 3, 1995 the Company has fixed the price
for all corn purchases through September 30, 1995.
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ITEM 2. MANAGEMENT DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
On December 23, 1991, the Department of Energy promissory note was
restructured by the execution of an Amended and Restated Loan
Restructuring Agreement (Restructuring Agreement) consisting of two
new promissory notes, Note A and Note B. Note A, in the amount of
$55,000,000, provides for 119 consecutive monthly installments of
interest and principal of $631,533 commencing April 30, 1992. Note A
provides for a fixed rate of interest of 6.75% per annum. Note B, in
the amount of $40,622,523, provides for a fixed rate of interest of
4.00% per annum. Payments of Note B are based upon monthly cash flow
as defined by the Restructuring Agreement. Based upon present facts
and circumstances, management has estimated that principal payments of
approximately $4,951,975 will be made during 1995 under the terms of
Note B.
On a long-term basis, the Company's ability to maintain sufficient
liquidity to meet its debt service and other obligations will depend
to a large extent upon favorable market price levels for corn and
ethanol; factors over which the Company has little control. However,
through its corn purchasing agreement and its strategy to excute
long-term ethanol sales contracts, the Company is attempting to
minimize its exposure to fluctuations in the corn and gasoline
markets. The Company anticipates that it will have sufficient
liquidity to meet demands in fiscal 1995.
RESULTS OF OPERATIONS
For the three months ended March 31, 1995, the Company generated
income of $4,040,924 compared to a loss of $5,158,291 for the three
months ended March 31, 1994. The income generated during the three
months ended March 31, 1995 was primarily due to lower corn costs, a
decrease in depreciation expense and an increase in the price and
volume of ethanol sold.
Revenue from the sale of ethanol increased during the three months
ended March 31, 1995 to $25,862,615 from $22,398,192 during the three
months ended March 31, 1994. This increase was primarily due to an
increase in the price and volume of ethanol sold.
Revenue from the sale of by-products decreased during the three months
ended March 31, 1995 to $7,166,405 from $8,092,910 during the three
months ended March 31, 1994. The decline in by-product revenue was
primarily due to a significant decrease in the selling price of DDGS.
Ethanol production totaled 21,710,045 gallons for the three months
ended March 31, 1995 as compared to 20,764,853 gallons for the three
months ended March 31, 1994. This approximate 4.6% increase in
ethanol production was primarily due to continued efficiency in the
ethanol production process. The plant also produced 68,759 tons of
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distillers dried grains and 40,079 tons of gaseous carbon dioxide for
the three months ended March 31, 1995 as compared to 64,292 tons of
distillers dried grains and 39,789 tons of gaseous carbon dioxide for
the three months ended March 31, 1994. Distillers dried grains and
gaseous carbon dioxide are by-products of the ethanol production
process.
Cost of goods sold decreased by $6,456,468 during the three months
ended March 31, 1995 compared to the same period in 1994 primarily due
to reduced corn costs and depreciation expense.
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PART II. OTHER INFORMATION
Item 1. Legal Proceedings
The Company is not party to any material legal proceedings
other than routine litigation incidental to its business.
Item 2. Changes in Securities
None
Item 3. Defaults Upon Senior Securities
None
Item 4. Submission of Matters to a Vote of Security Holders
None
Item 5. Other Information
None
Item 6. Exhibits and Reports on Form 8-K
A.) Exhibits:
4.1 Restated and Amended Limited Partnership Agreement
of the Company dated October 26, 1982 (filed as
Exhibit 12 to the Form 8 amending the Company's
quarterly report on Form 10-Q for the nine months
ended September 30, 1982, and incorporated herein
by reference).
4.2 Form of Subscription Agreement (filed as Exhibit
B-2 to the Registration Statement on Form S-1, No.
2-74254, and incorporated herein by reference).
4.3 Form of Assumption Agreement (filed as Exhibit B-3
to the Prospectus dated April 28, 1982 contained in
the Company's Registration Statement on Form S-1,
No. 2-74254, and incorporated herein by reference).
B.) Reports on Form 8-K:
None
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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.
NEW ENERGY COMPANY OF INDIANA
LIMITED PARTNERSHIP
By: New Energy Corporation of Indiana,
General Partner
Dated: May 12, 1995 By: S\________________________________
John H. Parker
President and Chief Operating
Officer
Dated: May 12, 1995 By: S\________________________________
Anthony R. Corso
Vice President and Chief Financial
Officer
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<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1995
<CASH> 12,546,323
<SECURITIES> 0
<RECEIVABLES> 4,592,205
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<INVENTORY> 5,582,434
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