<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the period ended September 30, 1995
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or
[_] Transition Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 [No Fee Required]
For the transition period from ____________________ to __________________
Commission File Number 0-11186
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PS PARTNERS, LTD.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
California 95-3729108
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
600 North Brand Blvd.
Glendale, California 91203-1241
- ---------------------------------------- ----------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (818) 244-8080
--------------
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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<PAGE>
INDEX
<TABLE>
<CAPTION>
<S> <C>
PART I. FINANCIAL INFORMATION
Condensed consolidated balance sheets at September 30,
1995 and December 31, 1994 2
Condensed consolidated statements of income for the three and nine
months ended September 30, 1995 and 1994 3
Condensed consolidated statements of cash flows for the nine
months ended September 30, 1995 and 1994 4
Notes to condensed consolidated financial statements 5
Management's discussion and analysis of financial condition
and results of operations 6-8
PART II. OTHER INFORMATION
(Items 1 through 5 are not applicable)
Item 6 - Exhibits and Reports on Form 8-K 9
</TABLE>
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PS PARTNERS, LTD
CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, December 31,
1995 1994
------------- ------------
<S> <C> <C>
(Unaudited)
ASSETS
Cash and cash equivalents $ 480,000 $ 1,855,000
Rent and other receivables 44,000 57,000
Real estate facilities, at cost:
Land 11,855,000 11,855,000
Buildings and equipment 45,643,000 45,063,000
------------ ------------
57,498,000 56,918,000
Less accumulated depreciation (21,592,000) (19,913,000)
------------ ------------
35,906,000 37,005,000
Other assets 127,000 123,000
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$ 36,557,000 $ 39,040,000
============ ============
LIABILITIES AND PARTNERS' EQUITY
Accounts payable $ 492,000 $ 486,000
Advance payments from renters 384,000 405,000
Minority interest in general
partnerships 21,463,000 21,540,000
Partners' equity:
Limited partners' equity, $500 per
unit, 66,000 units authorized,
issued and outstanding 14,033,000 16,399,000
General partner's equity 185,000 210,000
------------ ------------
Total partners' equity 14,218,000 16,609,000
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$ 36,557,000 $ 39,040,000
============ ============
</TABLE>
See accompanying notes.
2
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PS PARTNERS, LTD.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
------------------------ --------------------------
1995 1994 1995 1994
---------- ----------- ---------- -----------
<S> <C> <C> <C> <C>
REVENUE:
Rental income $2,804,000 $2,757,000 $8,153,000 $7,947,000
Interest income 26,000 14,000 84,000 27,000
---------- ---------- ---------- ----------
2,830,000 2,771,000 8,237,000 7,974,000
---------- ---------- ---------- ----------
COSTS AND EXPENSES:
Cost of operations 831,000 790,000 2,532,000 2,440,000
Management fees 166,000 162,000 485,000 473,000
Depreciation and amortization 586,000 534,000 1,680,000 1,594,000
Administrative 20,000 19,000 99,000 82,000
---------- ---------- ---------- ----------
1,603,000 1,505,000 4,796,000 4,589,000
---------- ---------- ---------- ----------
Income before minority interest 1,227,000 1,266,000 3,441,000 3,385,000
Minority interest in income 627,000 670,000 1,809,000 1,870,000
---------- ---------- ---------- ----------
NET INCOME $ 600,000 $ 596,000 $1,632,000 $1,515,000
========== ========== ========== ==========
Limited partners' share of net income
($18.45 per unit in 1995 and $20.26
per unit in 1994) $1,218,000 $1,337,000
General partner's share of net income 414,000 178,000
---------- ----------
$1,632,000 $1,515,000
========== ==========
</TABLE>
See accompanying notes.
3
<PAGE>
PS PARTNERS, LTD.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
<TABLE>
<CAPTION>
Nine Months Ended
September 30,
--------------------------
1995 1994
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<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 1,632,000 $ 1,515,000
Adjustments to reconcile net
income to net cash provided by
operating activities
Depreciation and amortization 1,680,000 1,594,000
Decrease (increase) in rent
and other receivables 13,000 (2,000)
(Increase) decrease in other
assets (4,000) 1,000
Increase (decrease) in
accounts payable 5,000 (67,000)
Decrease in advance payments
from renters (21,000) (44,000)
Minority interest in income 1,809,000 1,870,000
----------- -----------
Total adjustments 3,482,000 3,352,000
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Net cash provided by
operating activities 5,114,000 4,867,000
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CASH FLOWS FROM INVESTING ACTIVITIES:
Additions to real estate facilities (580,000) (515,000)
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Net cash used in
investing activities (580,000) (515,000)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Distributions to holder of
minority interest (1,886,000) (1,867,000)
Distributions to partners (4,023,000) (1,650,000)
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Net cash used in
financing activities (5,909,000) (3,517,000)
----------- -----------
Net (decrease) increase in cash and
cash equivalents (1,375,000) 835,000
Cash and cash equivalents at the
beginning of the period 1,855,000 831,000
----------- -----------
Cash and cash equivalents at the end of
the period $ 480,000 $ 1,666,000
========== ===========
</TABLE>
See accompanying notes.
4
<PAGE>
PS PARTNERS, LTD.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
SEPTEMBER 30, 1995
(UNAUDITED)
1. The accompanying unaudited condensed consolidated financial statements have
been prepared pursuant to the rules and regulations of the Securities and
Exchange Commission. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to
such rules and regulations, although management believes that the disclosures
contained herein are adequate to make the information presented not
misleading. These unaudited condensed consolidated financial statements
should be read in conjunction with the financial statements and related notes
appearing in the Partnership's Form 10-K for the year ended December 31,
1994.
2. In the opinion of management, the accompanying unaudited condensed
consolidated financial statements reflect all adjustments, consisting of only
normal accruals, necessary to present fairly the Partnership's financial
position at September 30, 1995, the results of operations for the three and
nine months ended September 30, 1995 and 1994 and cash flows for the nine
months then ended.
3. The results of operations for the three and nine months ended September 30,
1995 are not necessarily indicative of the results to be expected for the
full year.
5
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PS PARTNERS, LTD.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
Results of Operations:
- ----------------------
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1995 COMPARED TO THREE AND NINE
MONTHS ENDED SEPTEMBER 30, 1994:
The Partnership's net income was $1,632,000 and $1,515,000 for the nine
months ended September 30, 1995 and 1994, respectively, representing an increase
of $117,000. Net income was $600,000 and $596,000 for the three months ended
September 30, 1995 and 1994, respectively, representing an increase of $4,000.
These increases were primarily due to improved property operating results at the
Partnership's business park facilities combined with increased interest income
partially offset by an increase in depreciation expense.
Net property income for the nine months ended September 30, 1995 was
$5,136,000 compared to $5,034,000 for the same period in 1994, representing an
increase of $102,000, or 2%. Net property income for the three months ended
September 30, 1995 was $1,807,000 compared to $1,805,000 for the same period in
1994, representing an increase of $2,000.
Rental income for the nine months ended September 30, 1995 was $8,153,000
compared to $7,947,000 for the same period in 1994, representing an increase of
$206,000, or 3%. Rental income for the three months ended September 30, 1995
was $2,804,000 compared to $2,757,000 for the same period in 1994, representing
an increase of $47,000, or 2%.
The increases in rental income for both the three and nine month periods were
the result of increased average realized rental rates at the Partnership's mini-
warehouse and business park facilities, combined with increased occupancy at the
business park facilities partially offset by a decrease in occupancy rates at
the mini-warehouse facilities. The weighted average occupancy levels at the
mini-warehouse and business park facilities were 89% and 93%, respectively, for
the nine months ended September 30, 1995 compared to 90% and 88% respectively,
for the nine months ended September 30, 1994. The monthly average realized rent
per square foot for the mini-warehouse and business park facilities was $.59 and
$.66, respectively, for the nine months ended September 30, 1995 and $.56 and
$.63, respectively, for the nine months ended September 30, 1994.
Cost of operations (including management fees) was $3,017,000 and $2,913,000
for the nine months ended September 30, 1995 and 1994, respectively,
representing an increase of $104,000. Cost of
6
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PS PARTNERS, LTD.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
operations (including management fees) was $997,000 and $952,000 for the three
months ended September 30, 1995 and 1994, respectively, representing an increase
of $45,000. These increases were primarily attributable to increases in payroll,
insurance, and property tax expenses.
Net property income at the Partnership's mini-warehouse facilities for the
nine months ended September 30, 1995 increased $63,000 and decreased $24,000
for the three months ended September 30, 1995 as compared to the same periods in
1994. For the nine months, rental income at the mini-warehouse facilities
increased $163,000, from $7,495,000 in 1994 to $7,658,000 in 1995. For the
three months, rental income at the mini-warehouse facilities increased $25,000
from $2,606,000 in 1994 to $2,631,000 in 1995.
Cost of operations (including management fees) at the mini-warehouse
facilities was $2,803,000 and $2,703,000 for the nine months ended September 30,
1995 and 1994, respectively, representing an increase of $100,000. Cost of
operations (including management fees) at the mini-warehouse facilities was
$935,000 and $886,000 for the three months ended September 30, 1995 and 1994,
respectively, representing an increase of $49,000.
Net property income at the Partnership's business park facilities for the
nine months ended September 30, 1995 increased $39,000 and $26,000 for the
three months ended September 30, 1995 as compared to the same periods in 1994.
For the nine months, rental income at the business parks increased $43,000, from
$452,000 in 1994 to $495,000 in 1995. For the three months, rental income at
the business parks increased $22,000 from $151,000 in 1994 to $173,000 in 1995.
Cost of operations (including management fees) at the business parks was
$214,000 and $210,000 for the nine months ended September 30, 1995 and 1994,
respectively, representing an increase of $4,000. Cost of operations (including
management fees) at the business parks was $62,000 and $66,000 for the three
months ended September 30, 1995 and 1994, respectively, representing a decrease
of $4,000.
Administrative expenses increased $17,000 from $82,000 in 1994 to $99,000 in
1995. This increase is principally a result of non-recurring expenses totaling
$27,000 incurred in connection with having the Partnership's facilities undergo
environmental studies.
7
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PS PARTNERS, LTD.
MANAGEMENT'S DISCUSSION AND ANALYSIS
OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS
Minority interest in income decreased $61,000 to $1,809,000 from $1,870,000
for the nine months ended September 30, 1995 and 1994, respectively. This
decrease was primarily attributable to the allocation of depreciation and
amortization expense (pursuant to the partnership agreement with respect to
those real estate facilities which are jointly owned with SEI) to SEI of
$322,000 for the nine months ended September 30, 1995 compared to $228,000 for
the same period in 1994, partially offset by an increase in operations at the
Partnership's real estate facilities owned jointly with SEI.
Liquidity and Capital Resources
- -------------------------------
The Partnership has adequate sources of cash to finance its operations, both
on a short-term and long-term basis, primarily from internally generated cash
from property operations and cash reserves. Cash generated from operations
($5,114,000 for the nine months ended September 30, 1995) has been sufficient to
meet all current obligations of the Partnership.
During 1995, the Partnership anticipates approximately $770,000 of capital
improvements (of which $295,000 represents SEI's joint venture share). Total
capital improvements were $580,000 for the nine months ended September 30, 1995
of which $360,000 represents the Partnership's share.
The Partnership paid distributions to the limited and general partners
totaling $3,584,000 ($54.30 per unit) and $439,000, respectively, during the
first nine months of 1995, including a special distribution in the third
quarter. The special distribution, totaling $1,514,000 ($22.95 per unit) to the
limited partners and $185,000 to the general partners, was the result of
distributions of excess cash reserves. Future distribution rates may be
adjusted to levels which are supported by operating cash flow after capital
improvements and any other necessary obligations.
8
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PART II. OTHER INFORMATION
ITEMS 1 through 5 are not applicable.
Item 6 Exhibits and Reports on Form 8-K
--------------------------------
(a) The following Exhibits are included herein:
(27) Financial Data Schedule
(b) Form 8-K
None
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.
DATED: November 10, 1995
PS PARTNERS, LTD.
BY: Storage Equities, Inc.
General Partner
BY: /s/ Ronald L. Havner , Jr.
---------------------------------------
Ronald L. Havner, Jr.
Vice President - Storage Equities, Inc.
(principal financial and accounting
officer)
9
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-END> SEP-30-1995
<CASH> 480,000
<SECURITIES> 0
<RECEIVABLES> 44,000
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 524,000
<PP&E> 57,498,000
<DEPRECIATION> (21,592,000)
<TOTAL-ASSETS> 36,557,000
<CURRENT-LIABILITIES> 876,000
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 14,218,000
<TOTAL-LIABILITY-AND-EQUITY> 36,557,000
<SALES> 8,153,000
<TOTAL-REVENUES> 8,237,000
<CGS> 3,017,000
<TOTAL-COSTS> 3,017,000
<OTHER-EXPENSES> 1,779,000
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 1,632,000
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,632,000
<EPS-PRIMARY> 18.45
<EPS-DILUTED> 0.000
</TABLE>
