<PAGE>
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
(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, 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 0-11063
Winthrop Residential Associates II, A Limited Partnership
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(Exact name of small business issuer as specified in its charter)
Maryland 04-2742158
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(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
One International Place, Boston, Massachusetts 02110
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(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code (617) 330-8600
Indicate by check mark whether 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|_|
1 of 10
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WINTHROP RESIDENTIAL ASSOCIATES II, A LIMITED PARTNERSHIP
FORM 10-QSB MARCH 31, 1996
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
Balance Sheets (Unaudited)
March 31, December 31,
1996 1995
----------- -----------
Assets
Cash and cash equivalents $ 2,083,000 $ 2,078,000
Interest receivable -- 8,000
----------- -----------
Total assets $ 2,083,000 $ 2,086,000
=========== ===========
Liabilities and Partners' Capital
Liabilities:
Accounts payable and accrued expenses $ 33,000 $ --
Distribution payable 105,000 105,000
----------- -----------
Total Liabilities 138,000 105,000
----------- -----------
Partners Capital:
Limited Partners -
Units of Limited Partnership Interest,
$1,000 stated value per Unit; authorized, issued
and outstanding - 25,010 Units 2,935,000 2,970,000
General Partners (Deficit) (990,000) (989,000)
----------- -----------
Total Partners' Capital 1,945,000 1,981,000
----------- -----------
Total Liabilities and Partners' Capital $ 2,083,000 $ 2,086,000
=========== ===========
See notes to financial statements.
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WINTHROP RESIDENTIAL ASSOCIATES II, A LIMITED PARTNERSHIP
FORM 10-QSB MARCH 31, 1996
Statements of Operations (Unaudited)
For the Three Months Ended
March 31, March 31,
1996 1995
--------- ---------
Income:
Local limited partnership cash distributions $ 97,000 $ 95,000
Interest income 22,000 21,000
-------- --------
Total income 119,000 116,000
-------- --------
Expenses:
General and administrative 17,000 10,000
Management fees 33,000 16,000
-------- --------
Total expenses 50,000 26,000
-------- --------
Net income $ 69,000 $ 90,000
======== ========
Net income per Unit of Limited Partnership Interest $ 2.60 $ 3.42
======== ========
Distributions per Unit of Limited Partnership Interest $ 4.00 $ 2.00
======== ========
See notes to financial statements.
3 of 10
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WINTHROP RESIDENTIAL ASSOCIATES II, A LIMITED PARTNERSHIP
FORM 10-QSB MARCH 31, 1996
Statement of Changes in Partners' Capital (Unaudited)
<TABLE>
<CAPTION>
Units of
Limited General Limited
Partnership Partners' Partners' Total
Interest Deficit Capital Capital
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Balance - January 1, 1996 25,010 $ (989,000) $ 2,970,000 $ 1,981,000
Cash distributions (5,000) (100,000) (105,000)
Net income 4,000 65,000 69,000
----------- ----------- ----------- -----------
Balance - March 31, 1996 25,010 $ (990,000) $ 2,935,000 $ 1,945,000
=========== =========== =========== ===========
</TABLE>
See notes to financial statements.
4 of 10
<PAGE>
WINTHROP RESIDENTIAL ASSOCIATES II, A LIMITED PARTNERSHIP
FORM 10-QSB MARCH 31, 1996
Statements of Cash Flows (Unaudited)
<TABLE>
<CAPTION>
For the Three Months Ended
March 31, 1996 March 31, 1995
-------------- --------------
<S> <C> <C>
Cash Flows from Operating Activities:
Net income $ 69,000 $ 90,000
Adjustments to reconcile net income to net cash used
in operating activities:
Changes in assets and liabilities:
Decrease in interest receivable 8,000 68,000
Increase in accounts payable and accrued expenses 33,000 6,000
----------- -----------
Net cash provided by operating activities 110,000 164,000
----------- -----------
Cash Flows From Financing Activities:
Cash distributions paid (105,000) (53,000)
----------- -----------
Cash used for financing activities (105,000) (53,000)
----------- -----------
Net increase in cash and cash equivalents 5,000 111,000
Cash and cash equivalents, beginning of period 2,078,000 1,566,000
----------- -----------
Cash and cash equivalents, end of period $ 2,083,000 $ 1,677,000
=========== ===========
</TABLE>
See notes to financial statements.
5 of 10
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WINTHROP RESIDENTIAL ASSOCIATES II, A LIMITED PARTNERSHIP
FORM 10 - QSB MARCH 31, 1996
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
1. General
The accompanying financial statements, footnotes and discussions should be
read in conjunction with the financial statements, related footnotes and
discussions contained in the Partnership's Annual Report for the year
ended December 31, 1995.
The financial information contained herein is unaudited. In the opinion of
management, all adjustments necessary for a fair presentation of such
financial information have been included. All adjustments are of a normal
recurring nature. Certain amounts have been reclassified to conform to the
March 31, 1996 presentation. The balance sheet at December 31, 1995 was
derived from audited financial statements at such date.
The results of operations for the three months ended March 31, 1996 and
1995 are not necessarily indicative of the results to be expected for the
full year.
2. Fees and other compensation paid or accrued by the Partnership to the
General Partners, or their affiliates, during the three months ended March
31, 1996:
<TABLE>
<CAPTION>
Entity Receiving Form of
Compensation Compensation Amount
---------------- ------------------------------------------- ------
<S> <C> <C>
Winthrop
Management Property Management Fees $ 33,000
General Partners Interest in Cash Available for Distribution $ 5,000
</TABLE>
6 of 10
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WINTHROP RESIDENTIAL ASSOCIATES II, A LIMITED PARTNERSHIP
FORM 10 - QSB MARCH 31, 1996
Item 2. Management's Discussion and Analysis or Plan of Operation
This Item should be read in conjunction with the financial statements
and other items contained elsewhere in the report.
Liquidity and Capital Resources
As of March 31, 1996, the Partnership retained an equity interest in
nine Local Limited Partnerships owning 11 apartment properties. The
Partnership's primary source of income is distributions from the Local
Limited Partnerships. The Partnership requires cash to pay its general
and administrative expenses or to make capital contributions to any of
the Local Limited Partnerships which the Managing General Partner
deems to be in the Partnership's best interest to preserve its
ownership interest.
To date, all cash requirements have been satisfied by interest income
earned on short-term investments and cash distributed to the
Partnership by the Local Limited Partnerships. If the Partnership
funds any operating deficits, it will use monies from its operating
reserves. As of March 31, 1996, the Partnership held operating
reserves of approximately $2,083,000 which is expected to be
sufficient to fund any anticipated deficits. The Managing General
Partner's current policy is to maintain a reserve balance sufficient
to provide, at a minimum, interest income in an amount equal to the
Partnership's annual general and administrative expenses. Therefore, a
lack of cash distributed by the Local Limited Partnership to the
Partnership in the future should not deplete the reserves, though it
may restrict the Partnership from making distributions.
The Partnership is not obligated to provide any additional funds to
the Local Limited Partnerships to fund operating deficits. The
Partnership will determine on a case by case basis whether to fund any
operating deficits. If a Local Partnership sustains continuing
operating deficits and has no other sources of funding, it is likely
that it will eventually default on its mortgage obligations and risk a
foreclosure on its property by the lender. If a foreclosure were to
occur, the Local Limited Partnership would lose its investment in the
property and would incur a tax liability due to the recapture of tax
benefits taken in prior years. The Partnership, as an owner of the
Local Limited Partnership, would share these consequences in
proportion to its ownership interest in the Local Limited Partnership.
During the first quarter of 1996, the Partnership distributed $100,000
or $4.00 per unit to its limited partners and $5,000 to the general
partners. The ability of the Partnership to continue to make
distributions to its partners is dependent upon the financial
performance of the Local Limited Partnerships.
7 of 10
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WINTHROP RESIDENTIAL ASSOCIATES II, A LIMITED PARTNERSHIP
FORM 10 - QSB MARCH 31, 1996
Item 2. Management's Discussion and Analysis or Plan of Operation (Continued)
Results of Operations
Net income decreased by $21,000 for the three months ended March 31,
1996 as compared to the three months ended March 31, 1995 due to an
increase in income of $3,000 which was more than offset by an increase
in expenses of $24,000. Income increased due to a $2,000 increase in
cash distributions received from Local Limited Partnerships and a
$1,000 increase in interest income during the three months ended March
31, 1996 as compared to the comparable period in 1995. The increase in
expenses is attributable to a $7,000 increase in general and
administrative expenses and a $17,000 increase in management fees.
8 of 10
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WINTHROP RESIDENTIAL ASSOCIATES II, A LIMITED PARTNERSHIP
FORM 10 - QSB MARCH 31, 1996
PART - II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibit 27, Financial Data Schedule, is filed as an exhibit to this
report.
(b) Reports on Form 8K: No report on Form 8-K was filed during the period.
9 of 10
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WINTHROP RESIDENTIAL ASSOCIATES II, A LIMITED PARTNERSHIP
FORM 10 - QSB MARCH 31, 1996
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
BY: ONE WINTHROP PROPERTIES, INC.
Managing General Partner
BY: ______________________________
/s/ Michael L. Ashner
Chief Executive Officer
BY: ______________________________
/s/ Edward V. Williams
Chief Financial Officer
Dated: May 14, 1996
10 of 10
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
The schedule contains summary financial information extracted from Winthrop
Residential Associates II, A Limited Partnership and is qualified in its
entirety by reference to such financial statements.
</LEGEND>
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<CASH> 2,083,000
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 2,083,000
<CURRENT-LIABILITIES> 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 1,945,000
<TOTAL-LIABILITY-AND-EQUITY> 2,083,000
<SALES> 0
<TOTAL-REVENUES> 97,000
<CGS> 0
<TOTAL-COSTS> 33,000
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 69,000
<INCOME-TAX> 0
<INCOME-CONTINUING> 69,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 69,000
<EPS-PRIMARY> 2.60
<EPS-DILUTED> 2.60
</TABLE>
