<PAGE> 1
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, 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 0-13241
NOONEY INCOME FUND LTD., L.P.
- -------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Missouri 43-1302570
- ------------------------------------------- ----------------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
7701 Forsyth Boulevard, St. Louis, Missouri 63105
- ------------------------------------------- ----------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (314) 863-7700
- -------------------------------------------------------------------------------
Former name, former address and former fiscal year,
if changed since last report
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 [ ].
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDING DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13, or 15 (d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court. Yes [ ] No [ ]
APPLICABLE ONLY TO CORPORATE ISSUERS: Indicate the number of shares outstanding
of each of the issuer's classes of common stock, as of the latest practicable
date .
----------------------
Page 1 of 12 pages
<PAGE> 2
PART I
ITEM 1 - FINANCIAL STATEMENTS:
- ------------------------------
<TABLE>
NOONEY INCOME FUND LTD., L.P.
-----------------------------
(A LIMITED PARTNERSHIP)
-----------------------
BALANCE SHEETS
--------------
<CAPTION>
Sept. 30, Dec. 31,
1995 1994
(Unaudited)
----------- -----------
<S> <C> <C>
ASSETS:
Cash and cash equivalents $ 637,607 $ 744,883
Accounts receivable 114,646 108,981
Prepaid expenses and deposits 14,522 -0-
Investment property, at cost:
Land and improvements 1,946,169 1,946,169
Buildings 8,252,390 7,958,613
----------- -----------
10,198,559 9,904,782
Less accumulated depreciation 4,042,276 3,772,564
----------- -----------
6,156,283 6,132,218
Deferred expenses - At amortized cost 116,498 121,640
----------- -----------
$ 7,039,556 $ 7,107,722
=========== ===========
LIABILITIES AND PARTNERS' EQUITY:
Liabilities:
Accounts payable and accrued expenses $ 222,321 $ 230,990
Mortgage notes payable 1,342,800 1,387,200
Refundable tenant deposits 110,090 98,962
----------- -----------
1,675,211 1,717,152
Partners' Equity 5,364,345 5,390,570
----------- -----------
$ 7,039,556 $ 7,107,722
=========== ===========
</TABLE>
<PAGE> 3
<TABLE>
NOONEY INCOME FUND LTD., L.P.
-----------------------------
(A LIMITED PARTNERSHIP)
-----------------------
STATEMENTS OF OPERATIONS AND PARTNERS' EQUITY
---------------------------------------------
(UNAUDITED)
-----------
<CAPTION>
Three Months Ended Nine Months Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
1995 1994 1995 1994
As Restated As Restated
See Note E See Note E
----------- ----------- ------------ ------------
<S> <C> <C> <C> <C>
REVENUES:
Rental and other income $ 414,040 $ 373,334 $ 1,203,681 $ 1,064,076
Interest 3,741 4,087 15,405 13,217
----------- ----------- ------------ ------------
417,781 377,421 1,219,086 1,077,293
EXPENSES:
Interest 33,663 30,548 102,028 83,780
Depreciation and amortization 119,241 111,419 359,076 318,207
Real estate taxes 49,821 51,078 141,616 153,234
Property management fees paid to
Nooney Krombach Company 24,934 22,552 72,771 63,797
Reimbursement to Nooney Krombach Company for
partnership management services and indirect
expenses 6,250 6,250 18,750 18,750
Other operating expenses 132,542 129,406 445,645 428,302
----------- ----------- ------------ ------------
366,451 351,253 1,139,886 1,066,070
----------- ----------- ------------ ------------
NET INCOME $ 51,330 $ 26,168 $ 79,200 $ 11,223
=========== =========== ============ ============
NET INCOME (LOSS) PER LIMITED PARTNERSHIP $ 2.76 $ 0.96 $ 4.68 $ (0.96)
=========== =========== ============ ============
PARTNERS' EQUITY:
Beginning of Period $ 5,313,015 $ 5,579,852 $ 5,390,570 $ 5,594,797
Net Income 51,330 26,168 79,200 11,223
Cash distributions to partners -0- -0- (105,425) -0-
----------- ----------- ------------ ------------
End of Period $ 5,364,345 $ 5,606,020 $ 5,364,345 $ 5,606,020
=========== =========== ============ ============
</TABLE>
<PAGE> 4
<TABLE>
NOONEY INCOME FUND LTD., L.P.
-----------------------------
(A LIMITED PARTNERSHIP)
-----------------------
STATEMENTS OF CASH FLOW
-----------------------
(UNAUDITED)
-----------
<CAPTION>
Three Months Ended Nine Months Ended
Sept. 30, Sept. 30, Sept. 30, Sept. 30,
1995 1994 1995 1994
As Restated As Restated
See Note E See Note E
----------- ----------- ------------ ------------
<S> <C> <C> <C> <C>
CASH FLOWS (USED IN) PROVIDED BY OPERATING ACTIVITIES:
Net Income $ 51,330 $ 26,168 $ 79,200 $ 11,223
Adjustments to reconcile net income to net cash
(used in) provided by operating activities:
Depreciation and amortization 119,241 111,419 359,076 318,207
Changes in assets and liabilities:
Decrease (Increase) in accounts receivable 10,768 5,834 (5,665) 19,842
Increase in prepaid expenses (3,933) 0 (14,522) 0
Increase in deferred assets (19,959) (15,312) (36,343) (54,571)
Decrease in accounts payable and accrued expenses (187,335) (965) (8,669) (13,401)
Increase in refundable tenant deposits 5,056 7,102 11,128 26,703
----------- ----------- ------------ ------------
Total Adjustments (76,162) 108,078 305,005 296,780
----------- ----------- ------------ ------------
Net cash (used in) provided by operating
activities (24,832) 134,246 384,205 308,003
CASH FLOWS USED IN INVESTING ACTIVITIES:
Adjustments to investment property (14,579) (75,788) (341,656) (198,642)
----------- ----------- ------------ ------------
Net cash used in investing activities (14,579) (75,788) (341,656) (198,642)
CASH FLOWS USED IN FINANCING ACTIVITIES:
Cash distributions to part 0 0 (105,425) 0
Payments on notes payable (11,500) (14,100) (44,400) (42,300)
----------- ----------- ------------ ------------
Net cash used in financing activities (11,500) (14,100) (149,825) (42,300)
----------- ----------- ------------ ------------
NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (50,911) 44,358 (107,276) 67,061
CASH, beginning of period 688,518 854,226 744,883 831,523
----------- ----------- ------------ ------------
CASH, end of period $637,607 $898,584 $637,607 $898,584
=========== =========== ============ ============
</TABLE>
<PAGE> 5
NOONEY INCOME FUND LTD., L.P.
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
NOTE A:
Refer to the Registrant's financial statements for the fiscal year ended
December 31, 1994 which are contained in the Registrant's Annual report on
Form 10-K, for a description of the accounting policies which have been
continued without change except as noted below. Also, refer to the footnotes
to those statements for additional details of the Registrant's financial
condition. The details in those notes have not changed except as a result of
normal transactions in the interim periods or as noted below.
NOTE B:
The financial statements include only those assets, liabilities, and results of
operations of the partners which relate to the business of Nooney Income Fund.,
L.P. The statements do not include assets, liabilities, revenues or expenses
attributable to the partners' individual activities. No provision has been
made for federal and state income taxes since these taxes are the
responsibilities of the partners. In the opinion of the general partners, all
adjustments (which include only normal recurring adjustments) necessary to
present fairly the financial position, results of operations and changes in
financial position at September 30, 1995 and for all periods presented have
been made.
NOTE C:
The Registrant's properties are managed by Nooney Krombach Company, a wholly-
owned subsidiary of Nooney Company. Certain general partners of the Registrant
are officers and directors of Nooney Company. Nooney Income Investments, Inc.,
a general partner, is a 75% owned subsidiary of Nooney Company.
NOTE D:
The earnings per limited partnership unit for the three months and nine months
ended September 30, 1995 and 1994 was computed on 15,180 units, the number of
units outstanding during the periods.
NOTE E:
Subsequent to the filing of the 1994 10-Q's, the Registrant's management
determined that certain adjustments were not properly reflected in the
quarterly financial statements. The adjustments were as follows:
(i) Depreciation expense had previously been overstated as a result of a
computational error. The adjustment results in a reduction of
depreciation expense and an increase in net income of $25,658 for the
quarter ended September 30, 1994. The aforementioned adjustment was
properly reflected in the December 31, 1994 financial statements.
(ii) Certain net income per limited partnership unit amounts have also been
restated to reflect an error made in the previous per unit
calculations.
<PAGE> 6
ITEM 7: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
- ------------------------------------------------------------------------
Liquidity and Capital Resources
- -------------------------------
Cash on hand as of September 30, 1995 is $637,607, a decrease of $107,276
from year end December 31, 1994. The decrease in cash is attributable to
capital expenditures for tenant leasing and buildout at Oak Grove Commons along
with a distribution to the shareholders. The decrease in cash does not affect
the Registrant's opinion on the properties ability to provide adequate cash
flow from operations to fund anticipated capital expenditures for the remainder
of 1995. The anticipated expenditures by property are as follows:
<TABLE>
<CAPTION>
Other Leasing
Capital Capital Total
---------- ---------- ----------
<S> <C> <C> <C>
Oak Grove Commons $ 0 $ 12,000 $ 12,000
Leawood Fountain Plaza (76%) 9,000 65,900 74,900
---------- ---------- ----------
$ 9,000 $ 77,900 $ 86,900
========== ========== ==========
</TABLE>
During the remainder of 1995, approximately $86,900 of capital expenditures
are expected. Oak Grove Commons and Leawood Fountain Plaza leasing capital
includes funds for tenant alterations to their respective suites along with
lease commissions for new tenant leases. Other capital expenditures at Leawood
Fountain Plaza include expenditures to the property to meet current ADA
requirements and the repair of minor structural problems.
In June 1995, the Registrant successfully negotiated the renewal of the
first mortgage debt secured by Oak Grove Commons for a period of one year
effective July 1, 1995. The interest rate will remain at 1% over the prime
rate. Monthly principal payments will increase from $4,700 to $5,400.
<PAGE> 7
Results of Operations
- ---------------------
The results of operations for the Registrant's properties for the quarters
ended September 30, 1995 and 1994 are detailed in the schedule below. Expenses
of the Registrant are excluded.
<TABLE>
<CAPTION>
Oak Grove Leawood Fountain
Commons Plaza (76%)
---------------- ----------------
<S> <C> <C>
1995
- ----
Revenues $ 212,394 $ 203,175
Expenses 176,169 199,936
---------------- ----------------
Net Income $ 36,225 $ 3,239
================ ================
1994
- ----
Revenues $ 167,386 $ 208,486
Expenses 157,066 209,008
---------------- ----------------
Net Income $ 10,320 $ (522)
================ ================
</TABLE>
For the quarter ended September 30, 1995, Oak Grove Commons net income is
$36,225, an increase of $25,905 from the previous quarter ended September 30,
1994. The increase relates to a $44,231 increase in rental income partially
offset by increases in the following operating expenses: repairs and
maintenance $7,455; landscaping $2,600; management fees $2,701; and interest
expense $3,115. The increase in rental income relates to a significant
increase in occupancy along with slightly increasing rental rates. The
operations of Leawood Fountain Plaza for the quarter ended September 30, 1995
were similar to the quarter ended September 30, 1994.
<PAGE> 8
The occupancy levels at the Registrant's properties during the third
quarter continued their upward trend. These high levels can be attributable to
the Registrant's ability to lease up space as it becomes available. The
occupancy levels at the Registrant's properties are listed below:
<TABLE>
<CAPTION>
PROPERTY Occupancy Levels at September 30,
- -------------------------------------------- ---------------------------------
1995 1994 1993
---------- ---------- ---------
<S> <C> <C> <C>
Oak Grove Commons 100% 80% 75%
(100% ownership)
Leawood Fountain Pl. 96% 94% 91%
(76% ownership)
</TABLE>
Oak Grove Commons' increase in occupancy during the third quarter is
attributable to the underwriting of two new leases with cumulative square feet
of 7,042. During the third quarter the property did not have any renewals or
tenants vacating their space. Oak Grove Commons has a single tenant who
occupies approximately 10% of the available space. The tenant's lease expires
in December 1997.
During the third quarter the occupancy level at Leawood Fountain Plaza
increased from the previous quarter through the net leasing of 1,718 square
feet. Two new leases were signed during the third quarter accounting for 3,929
square feet. Offsetting the newly leased space was the vacating of a single
tenant. The Registrant renewed four existing tenant leases totaling
approximately 15,222 square feet. The rental rates for the new leases and
renewals have slightly increased from the previous quarter. The property has
one major tenant that leases approximately 10% of the available space. Their
lease expires in July 1999.
1995 Comparisons
- ----------------
As of September 30, 1995, the Registrant's consolidated revenues are
$417,781 for the quarter ended and $1,219,086 for the nine month period ended.
The revenues have increased $40,360 or 10.69% for the quarter ended September
30, 1995 and $141,793 or 13.16% for the nine month period ended September 30,
1995 when compared to the same periods ended September 30, 1994.
A majority of the increase in consolidated revenues for the quarter ended
and nine month period ended relate to Oak Grove Commons. At Oak Grove Commons
revenues increased $45,008 and $143,697 for the quarter ended and nine month
period ended September 30, 1995 when compared to the same periods ended
September 30, 1994. The significant increase in revenues at Oak Grove Commons
is attributable to rental income. Rental income has increased as occupancy has
increased. During the period October 1, 1994 through September 30, 1995
occupancy increased from 80% to 100%. Revenues at Leawood Fountain Plaza
remained relatively flat for the quarter ended and nine month period ended
September 30, 1995.
<PAGE> 9
As of September 30, 1995, the Registrant's consolidated expenses for the
quarter ended and nine month period ended are $366,451 and $1,139,886,
respectively. Expenses for the quarter ended increased $15, 198 or 4.33% when
compared to the quarter ended September 30, 1994. For the nine month period
ended September 30, 1995 expenses increased $73,816 or 6.92% when compared to
the same period ended September 30, 1994. For the quarter ended interest
expense, depreciation and amortization and management fees had increases while
real estate tax expense decreased slightly. Interest expense increased due to
rate increases on the floating rate debt secured by Oak Grove Commons.
Depreciation and amortization has the largest increase and the increase can be
attributable to increased capital expenditures for tenant improvements and
leasing commissions. As expected, with the significant increases in revenues
at Oak Grove commons, a corresponding increase in management fees has also
occurred. The decrease in real estate taxes is comprised of an increase at
Leawood Fountain Plaza offset by a decrease at Oak Grove Commons. The changes
in real estate taxes are attributable to rate changes and/or property
reassessments.
For the nine month period ended September 30, 1995 there were increases in
interest expense depreciation and amortization, management fees and other
operating expenses while real estate taxes decreased. Interest expense
increased due to an increase in the prime lending rate which led to an increase
in Oak Grove Commons floating rate debt. Depreciation and amortization has the
largest increase which can be attributable to increased capital expenditures
for tenant improvements and leasing commissions. As expected, with the
significant increases in revenues at Oak Grove Commons, a corresponding
increase in management fees has also occurred. The increase in other operating
expenses is attributable to increased utilities ($10,611) repairs and
maintenance ($24,850), parking lot and painting expenditures ($8,025) and
administrative costs ($12,699). These increases were partially offset by
decreases in cleaning ($12,633) and snow removal ($18,606). The decrease in
real estate taxes is comprised of an increase at Leawood Fountain Plaza offset
by an increase at Oak Grove Commons. The changes in real estate taxes are
attributable to rate changes and/or property reassessments.
<PAGE> 10
1994 Comparisons
- ----------------
On a consolidated basis, revenue for the quarter ended September 30, 1994
was $377,421, an increase of $4,216 or 1.13% when compared to quarter ended
September 30, 1993. For the nine months ended September 30, 1994 revenues were
$1,077,293, a decrease of $42,117 or 3.76% when compared to the same period
ended September 30, 1993. For the quarter ended the operations of Oak Grove
Commons and Leawood Fountain Plaza remained relatively stable. For the nine
month period ended revenues increased $9,952 or 1.66% at Leawood Fountain Plaza
along with an increase in revenues recorded by the Registrant due to an
increase in interest income. Offsetting these increases was a decrease in
revenues at Oak Grove Commons of $51,573 or 10.22%. The decrease in revenues
can be attributed to the level of occupancy. When comparing the occupancy
trend for the nine months ended September 30, 1993 to the same period ended
September 30, 1994, significant differences are present. The differences are
as follows:
<TABLE>
<CAPTION>
1994 1993
------ ------
<S> <C> <C>
January 1 64.00% 85.00%
March 31 64.00% 77.00%
June 30 74.00% 75.00%
September 30 80.00% 75.00%
Average Occupancy 70.50% 78.00%
</TABLE>
As noted, the average occupancy for the nine month periods ended
September 30, 1994 and 1993 are 70.50% and 78.00%, respectively.
Consolidated expenses for the quarter ended and nine month period ended
September 30, 1994 were $351,253 and $1,077,293,respectively. Consolidated
expenses decreased approximately 2.59% when comparing quarter ended September
30, 1994 to the same period ended September 30, 1993, while for the nine period
consolidated expenses decreased approximately 8.11%. For the quarter ended
real estate taxes increased while other operating expenses and depreciation and
amortization decreased. The real estate tax increase is attributable to an
accrual adjustment recorded in the third quarter of 1993 to properly reflect
Leawood Fountain Plaza's real estate tax expense. For the quarter ended the
decrease in other operating expenses relate to parking lot expenditures
($4,876), vacancy expense ($5,196) and professional services ($3,522) offset by
an increase advertising ($1,634). The decrease in depreciation and
amortization relates to certain capital expenditures (lease commissions and
tenant alterations) at the Registrant's properties becoming fully depreciated
and/or amortized. For the nine month period ended the decrease in consolidated
expenses relate to the decrease in other operating expenses along with
depreciation and amortization. Other operating expenses decreased $22,197 or
4.93% when comparing September 30, 1994 to September 30, 1993. Individual
expense variations were decreases in snow removal ($13,920), utilities
($6,227), and parking lot expenditures ($3,678). The decrease in depreciation
and amortization for the nine month period ended is due to the same cause as
stated for the quarter ended decrease.
<PAGE> 11
Inflation
- ---------
The effects of inflation did not have a material impact upon the
Registrant's operation in fiscal 1994, and are not expected to materially
affect the Registrant's operation in 1995.
Interest Rates
- --------------
Declining interest rates on floating rate debt have positively affected the
operations of the Registrant during 1993. Increases in the prime interest rate
did adversely affect the operations of the Registrant in 1994 and 1995 and will
in the future.
<PAGE> 12
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Exhibit 27 -- Financial Data Schedule (provided for the
information of the Securities and Exchange
Commission only)
(b) Reports on 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.
NOONEY INCOME FUND LTD., L.P.
Dated: 11/14/95 By: /s/ Gregory J. Nooney, Jr.
-----------------------------------------
Gregory J. Nooney, Jr.
General Partner
Nooney Income Investments, Inc.
By: /s/ Gregory J. Nooney, Jr.
-----------------------------------------
Gregory J. Nooney, Jr.
Chairman of the Board and
Chief Executive Officer
By: /s/ Patricia A. Nooney - Director
-----------------------------------------
Senior Vice President and Secretary
BEING A MAJORITY OF THE DIRECTORS
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
FINANCIAL STATEMENTS FOR NOONEY INCOME FUND LTD., L.P. AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<CIK> 0000725266
<NAME> NOONEY INCOME FUND LTD., L.P.
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-START> JAN-01-1995
<PERIOD-END> SEP-30-1995
<CASH> 839,993
<SECURITIES> 0
<RECEIVABLES> 118,766
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 958,759
<PP&E> 9,902,793
<DEPRECIATION> 3,860,412
<TOTAL-ASSETS> 7,124,686
<CURRENT-LIABILITIES> 347,922
<BONDS> 1,368,400
<COMMON> 0
0
0
<OTHER-SE> 5,408,364
<TOTAL-LIABILITY-AND-EQUITY> 7,124,686
<SALES> 398,760
<TOTAL-REVENUES> 398,760
<CGS> 347,099
<TOTAL-COSTS> 347,099
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 33,867
<INCOME-PRETAX> 17,794
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 17,794
<EPS-PRIMARY> .44
<EPS-DILUTED> 0
</TABLE>
