SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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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
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Commission file number 0-13241
NOONEY INCOME FUND LTD., L.P.
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(Exact name of Registrant as specified in its charter)
Missouri
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(State or other jurisdiction of incorporation or organization)
43-1302570
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(I.R.S. Employer Identification No.)
7701 Forsyth Boulevard, St. Louis, Missouri 63105
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (314) 863-7700
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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 .
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Page 1 of 11 pages
<PAGE>
<TABLE>
NOONEY INCOME FUND LTD., L.P.
(A LIMITED PARTNERSHIP)
BALANCE SHEETS
<CAPTION>
September 30, December 31,
1996 1995
(Unaudited)
------------ ------------
<S> <C> <C>
ASSETS:
Cash ...................................................................................... $ 892,145 $ 656,904
Accounts receivable ....................................................................... 68,506 117,000
Prepaid expenses .......................................................................... 15,278 10,252
Investment property, at cost:
Land .................................................................................... 1,946,169 1,946,169
Buildings and improvements .............................................................. 8,218,945 8,254,994
------------ ------------
10,165,114 10,201,163
Less accumulated depreciation ........................................................... 4,311,798 4,063,922
------------ ------------
5,853,316 6,137,241
Deferred expenses - At amortized cost ..................................................... 76,231 107,628
------------ ------------
$ 6,905,476 $ 7,029,025
============ ============
LIABILITIES AND PARTNERS' EQUITY:
Liabilities:
Accounts payable and accrued expenses ..................................................... $ 25,995 $ 72,550
Accrued real estate taxes ................................................................. 155,625 152,265
Refundable tenant deposits ................................................................ 114,723 110,121
Mortgage notes payable .................................................................... 1,278,000 1,326,600
------------ ------------
Total liabilities ................................................................... 1,574,343 1,661,536
Partners' Equity ..................................................................................... 5,331,133 5,367,489
------------ ------------
$ 6,905,476 $ 7,029,025
============ ============
SEE NOTES TO FINANCIAL STATEMENTS
</TABLE>
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<PAGE>
<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,
1996 1995 1996 1995
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
REVENUES:
Rental and other income ...................................... $ 409,423 $ 414,040 $ 1,257,112 $ 1,203,681
Interest ..................................................... 5,307 3,741 14,419 15,405
----------- ----------- ----------- -----------
414,730 417,781 1,271,531 1,219,086
EXPENSES:
Interest ..................................................... 30,338 33,663 91,808 102,028
Depreciation and amortization ................................ 121,516 119,241 355,807 359,076
Real estate taxes ............................................ 51,875 49,821 157,696 141,616
Property management fees paid to Nooney Krombach Company ..... 25,079 24,934 76,397 72,771
Reimbursement to Nooney Krombach Company for partnership
management services and indirect expenses ................... 6,250 6,250 18,750 18,750
Other operating expenses ..................................... 202,455 132,542 501,999 445,645
----------- ----------- ----------- -----------
437,513 366,451 1,202,457 1,139,886
----------- ----------- ----------- -----------
NET (LOSS) INCOME ....................................................... $ (22,783) $ 51,330 $ 69,074 $ 79,200
=========== =========== =========== ===========
NET (LOSS) INCOME PER LIMITED PARTNERSHIP ............................... $ (1.48) $ 2.40 $ 3.82 $ 2.74
=========== =========== =========== ===========
PARTNERS' EQUITY:
Beginning of Period .......................................... $ 5,353,916 $ 5,313,015 $ 5,367,489 $ 5,390,570
Net (Loss) Income ............................................ (22,783) 51,330 69,074 79,200
Cash Distribution to partners ................................ -0- -0- (105,430) (105,425)
----------- ----------- ----------- -----------
End of Period ................................................ $ 5,331,133 $ 5,364,345 $ 5,331,133 $ 5,364,345
=========== =========== =========== ===========
SEE NOTES TO FINANCIAL STATEMENTS
</TABLE>
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<PAGE>
<TABLE>
NOONEY INCOME FUND LTD., L.P.
(A LIMITED PARTNERSHIP)
STATEMENTS OF CASH FLOWS
(UNAUDITED)
<CAPTION>
Three Months Ended Nine Months Ended
------------------------------ ------------------------------
September 30, September 30, September 30, September 30,
1996 1995 1996 1995
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
CASH FLOWS PROVIDED FROM OPERATING ACTIVITIES:
Net (Loss) Income ........................................ $ (22,783) $ 51,330 $ 69,074 $ 79,200
Adjustments to reconcile net income to net cash provided
by (used in) operating activities:
Depreciation and amortization ........................... 121,516 119,241 355,807 359,076
Changes in assets and liabilities:
Decrease (Increase) in accounts receivable ............ 59,186 10,768 48,494 (5,665)
Decrease (Increase) in prepaid expenses ............... 4,206 (3,933) (5,026) (14,522)
Increase in deferred expenses ......................... (5,208) (19,959) (7,336) (36,343)
(Decrease) Increase in accounts payable and accrued
expenses ............................................ (22,088) (172,643) (46,555) 211
(Decrease) Increase in accrued real estate taxes ...... 3,791 (14,692) 3,360 (8,880)
Increase in refundable tenant deposits ................ 1,674 5,056 4,602 11,128
------------- ------------- ------------- -------------
Total Adjustments ..................................... 163,077 (76,162) 353,346 305,005
------------- ------------- ------------- -------------
Net cash provided by (used in) operating activities ... 140,294 (24,832) 422,420 384,205
CASH FLOWS USED IN INVESTING ACTIVITIES:
Net additions to investment property ..................... (56,120) (14,579) (33,149) (341,656)
------------- ------------- ------------- -------------
Net cash used in investing activities .................... (56,120) (14,579) (33,149) (341,656)
CASH FLOWS USED IN FINANCING ACTIVITIES:
Cash distributions to partners ........................... -0- -0- (105,430) (105,425)
Payments on notes payable ................................ (16,200) (11,500) (48,600) (44,400)
------------- ------------- ------------- -------------
Net cash used in financing activities .................... (16,200) (11,500) (154,030) (149,825)
------------- ------------- ------------- -------------
NET INCREASE (DECREASE) IN CASH ................................ 67,974 (50,911) 235,241 (107,276)
CASH, beginning of period ...................................... 824,171 688,518 656,904 744,883
------------- ------------- ------------- -------------
CASH, end of period ............................................ $ 892,145 $ 637,607 $ 892,145 $ 637,607
============= ============= ============= =============
CASH, paid for interest ........................................ $ 30,338 $ 33,663 $ 91,808 $ 102,028
============= ============= ============= =============
SEE NOTES TO FINANCIAL STATEMENTS
</TABLE>
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<PAGE>
NOONEY INCOME FUND LTD., L.P.
(A LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1996 AND 1995
NOTE A:
Refer to the Registrant's financial statements for the fiscal year ended
December 31, 1995 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 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, 1996 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 and nine months ended
September 30, 1996 and 1995 was computed on 15,180 units, the number of units
outstanding during the periods.
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<PAGE>
ITEM 7: MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Liquidity and Capital Resources
Cash on hand as of September 30, 1996 is $892,145, an increase of $235,241 from
year end December 31, 1995. The increase in cash can be attributed to strong
operating results for the nine month period commencing January 1, 1996 at both
Oak Grove Commons and Leawood Fountain Plaza. With the increase in cash the
Registrant has been able to fund a $6.25 per Limited Partner unit distribution
and reduce the property's debt by $48,600. The Registrant expects the properties
to adequately fund anticipated capital expenditures for the remainder of 1996.
The anticipated capital expenditures are as follows:
Other Leasing
Capital Capital Total
------- ------- -------
Oak Grove Commons ................................ $10,900 $19,500 $30,400
Leawood Fountain Plaza (76%) ..................... 28,900 36,500 65,400
------- ------- -------
$39,800 $56,000 $95,800
======= ======= =======
During the remainder of 1996, approximately $95,800 of capital expenditures are
expected. Oak Grove Commons and Leawood Fountain Plaza leasing capital includes
funds for tenant alterations and lease commission for new and renewal leases.
Other capital costs at Oak Grove Commons relate to the replacement of certain
HVAC units. Other capital expenditures at Leawood Fountain Plaza include
expenditures to the property to meet current ADA requirements, repair of minor
structural problems, painting the building exteriors and stucco and repair of
the property's sidewalks and curbing.
Results of Property Operations
The results of operations for the Registrant's properties for the quarters ended
September 30, 1996 and 1995 are detailed in the schedule below. Expenses and
revenues of the Registrant are excluded.
Leawood
Oak Grove Fountain
Commons Plaza (76%)
------------ ------------
1996
- ------------------------------------------------
Revenues ....................................... $ 213,338 $ 204,878
Expenses ....................................... 230,559 214,923
------------ ------------
Net Loss ....................................... $ (17,221) $ (10,045)
============ ============
1995
- ------------------------------------------------
Revenues ....................................... $ 212,394 $ 203,175
Expenses ....................................... 176,169 199,936
------------ ------------
Net Income ..................................... $ 36,225 $ 3,239
============ ============
For the quarter ended September 30, 1996 when compared to the quarter ending
results from September 30, 1995, Oak Grove Commons and Leawood Fountain Plaza
had decreases in net income stemming from increases in operating expenses.
Revenues at both properties during the quarters remained relatively
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<PAGE>
stable. Operating expenses at Oak Grove Commons increased $54,390 due primarily
to the cost of preventative maintenance on the property's sprinkler system and
the repairing, sealing and striping of the parking lots. At Leawood Fountain
Plaza, the increase in operating expenses can be attributed to the repairing,
sealing and patching of the properties parking lot.
The occupancy levels at the Registrant's properties during the third quarter of
1996 remained at high levels. These high levels can be attributed to the
Registrant's ability to lease space as it becomes available. The occupancy
levels at the Registrant's properties are listed below.
Occupancy Levels at September 30,
---------------------------------
Property 1996 1995 1994
- --------------------------------------------- ---- ---- ----
Oak Grove Commons ........................... 96% 100% 80%
Leawood Fountain Plaza (76%) ................ 90% 96% 94%
Occupancy at Oak Grove Commons during the third quarter decreased from 98% to
96% through the move-out of three tenants occupying 8,951 square feet. The
Registrant during the quarter renewed one lease (1,150 square feet) and signed
two new leases totaling 5,951 square feet. At Oak Grove Commons a single tenant
occupies approximately 10% of the available space and their lease expires in
December 1997.
During the third quarter of 1996 leasing activity at Leawood Fountain Plaza
netted a decrease in occupancy of 3% due to the move-out of three tenants
occupying 2,447 square feet. Offsetting the tenant move-outs, the Registrant
executed one new lease totaling 501 square feet and renewed one lease totaling
1,649 square feet. The property has one major tenant who leases approximately
10% of the available space and their lease expires in July 1999.
Results of Consolidated Operations 1996
As of September 30, 1996, the Registrant's consolidated revenues for the quarter
ended and nine month period ended are $414,730 and $1,271,531, respectively.
Revenues for the quarter ended September 30, 1996 when compared to the same
period ended September 30, 1995 remained relatively stable. For the nine month
period ended September 30, 1996 revenues increased $52,445 or 4.3% when compared
to the nine month period ended September 30, 1995. The increase in revenues can
be attributed to increases in rental income at Oak Grove Commons and expense
recovery income at Leawood Fountain Plaza. These increases were offset by
decreases in rent concessions. At Oak Grove Commons rental income increased due
to higher average occupancy when comparing the first three quarters of 1996 to
1995. At Leawood Fountain Plaza expense recovery income increased due to an
increase in expenses from 1994 to 1995. As recoverable expenses increase from
year to year, the Registrant has the ability to pass through these increases to
the property's tenants.
Consolidated expenses for the quarter ended September 30, 1996 and 1995 are
$437,513 and $366,451, respectively. For the nine month periods ended September
30, 1996 and 1995 consolidated expenses are $1,202,457 and $1,139,886,
repsectively. The increase in consolidated expenses for the quarter ended can be
attributed to expenditures at both Oak Grove Commons and Leawood Fountain
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<PAGE>
Plaza for parking lot repairs, paving and sealing. Along with the parking lot
repairs, the Registrant performed preventative maintenance on the buildings
sprinkler system at Oak Grove Commons. For the nine month period ended the
increase can be attributed to the expenditures previously noted offset by a
decrease in interest expense which is a direct result of declining interest
rates on the Registrant's floating rate debt.
Results of Consolidated Operations 1995
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 revenue 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.
As of September 30, 1995, the Registrant's consolidated expenses for the quarter
ended and nine month period ended are $366,451 and $1,139,866, 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 increased while real estate tax expense
slightly decreased. 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 offset by decreases in cleaning ($12,633) and
snow removal ($18,606). The decrease in real estate taxes is comprised
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<PAGE>
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.
Inflation
The effects of inflation did not have a material impact upon the Registrant's
operations in fiscal year 1995, and are not expected to materially affect the
Registrant's operations in 1996.
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<PAGE>
PART II. OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
Refer to Exhibit Index on page 11.
(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: November 12, 1996 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
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<PAGE>
EXHIBIT INDEX
Exhibit No. Description
- ----------- -------------------------------------------------------------------
3 Amended and Restated Agreement and Certificate of Limited
Partnership dated November 7, 1983, is incorporated by
reference to the Prospectus contained in Post-Effective
Amendment No. 1 to the Registration Statement on Form S-11
under the Securities Act of 1933 (File No. 2-85683).
27 Financial Data Schedule (provided for the information of the
Securities and Exchange Commission only)
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<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.
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 892,145
<SECURITIES> 0
<RECEIVABLES> 68,506
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 975,929
<PP&E> 10,165,114
<DEPRECIATION> 4,311,798
<TOTAL-ASSETS> 6,905,476
<CURRENT-LIABILITIES> 181,620
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 5,331,133
<TOTAL-LIABILITY-AND-EQUITY> 6,905,476
<SALES> 1,257,112
<TOTAL-REVENUES> 1,271,531
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 1,110,649
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 91,808
<INCOME-PRETAX> 69,074
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 69,074
<EPS-PRIMARY> 4.09
<EPS-DILUTED> 0
</TABLE>
