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: 2-88051
BURGER KING LIMITED PARTNERSHIP III
(Exact name of registrant as specified in its charter)
New York 13-3178415
(State or other jurisdiction of (I.R.S. Employer
Incorporation or organization) identification No.)
3 World Financial Center, New York, NY 10285
(Address of principal executive offices) (Zip code)
(212) 526-3237
(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
Balance Sheets
March 31, December 31,
Assets 1995 1994
Real estate at cost:
Land $ 2,981,088 $ 2,981,088
Buildings 5,552,773 5,552,773
Fixtures and equipment 2,744,188 2,744,188
11,278,049 11,278,049
Less - accumulated depreciation (5,494,589) (5,425,179)
5,783,460 5,852,870
Cash 603,558 500,420
Rent receivable 20,932 34,238
Due from affiliates 12,520 12,889
Due from Burger King Corporation 48,039 176,963
Total Assets $ 6,468,509 $ 6,577,380
Liabilities and Partners' Capital
Liabilities:
Accounts payable and accrued expenses $ 28,876 $ 41,160
Distributions payable 503,558 400,420
Total Liabilities 532,434 441,580
Partners' Capital (Deficit):
General Partner (23,591) (17,076)
Limited Partners 5,959,666 6,152,876
Total Partners' Capital 5,936,075 6,135,800
Total Liabilities and
Partners' Capital $ 6,468,509 $ 6,577,380
Statement of Partners' Capital (Deficit)
For the three months ended March 31, 1995
Limited General
Partners Partner Total
Balance at December 31, 1994 $ 6,152,876 $ (17,076) $ 6,135,800
Net income 293,656 19,109 312,765
Distributions (486,866) (25,624) (512,490)
Balance at March 31, 1995 $ 5,959,666 $ (23,591) $ 5,936,075
Statements of Operations
For the three months ended March 31, 1995 and 1994
Income 1995 1994
Rental income $ 506,033 $ 487,882
Interest income 7,003 3,258
Other income 480 1,215
Total Income 513,516 492,355
Expenses
Depreciation 69,410 69,410
Ground lease rent 69,216 64,396
Management fee 47,078 46,690
General and administrative 15,047 19,232
Total Expenses 200,751 199,728
Net Income $ 312,765 $ 292,627
Net Income Allocated:
To the General Partner $ 19,109 $ 18,102
To the Limited Partners 293,656 274,525
$ 312,765 $ 292,627
Per limited partnership
interest (15,000 outstanding) $ 19.58 $ 18.30
Statements of Cash Flows
For the three months ended March 31, 1995 and 1994
Cash Flows from Operating Activities: 1995 1994
Net income $ 312,765 $ 292,627
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation 69,410 69,410
Increase (decrease) in cash arising from
changes in operating assets and liabilities:
Rent receivable 13,306 (1,877)
Due from affiliates 369 (359)
Due from Burger King Corporation 128,924 173,860
Accounts payable and accrued expenses (12,284) (15,335)
Net cash provided by operating activities 512,490 518,326
Cash Flows from Financing Activities:
Cash distributions paid (409,352) (378,097)
Net cash used for financing activities (409,352) (378,097)
Net increase in cash 103,138 140,229
Cash at beginning of period 500,420 470,856
Cash at end of period $ 603,558 $ 611,085
Notes to the Financial Statements
The unaudited interim financial statements should be read in conjunction with
the Partnership's annual 1994 audited financial statements within Form 10-K.
The unaudited financial statements include all adjustments which are, in the
opinion of management, necessary to present a fair statement of financial
position as of March 31, 1995 and the results of operations and cash flows for
the three months ended March 31, 1995 and 1994 and the statement of changes in
partners' capital (deficit) for the three months ended March 31, 1995. Results
of operations for the period are not necessarily indicative of the results to
be expected for the full year.
No significant events have occurred subsequent to fiscal year 1994, and no
material contingencies exist which would require disclosure in this interim
report per Regulation S-X, Rule 10-01, Paragraph (a)(5).
Part I, Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Liquidity and Capital Resources
The Partnership's cash balance consists of working capital and undistributed
cash flow from operations. At March 31, 1995, the cash balance was $603,558,
compared to $500,420 at December 31, 1994. The increase in cash is primarily
due to the return of a portion of the 1994 management fee paid to Burger King
Corporation ("BKC").
Cash flow generated from operations is distributed quarterly to the partners.
At March 31, 1995, the Partnership had distributions payable of $503,558 which
was distributed to the partners on April 28, 1995.
Due from Burger King Corporation decreased from $176,963 at December 31, 1994,
to $48,039 at March 31, 1995. The decrease is a result of payments made by BKC
as a refund of a portion of the management fees paid by the Partnership to BKC
in 1994. In accordance with the terms of the property management agreement
between BKC and the Partnership, BKC is required to return all or a portion of
its annual property management fee to the Partnership if rents from the
properties do not provide an annual return of 15.5% on the Partnership's
initial investment.
Rent receivable decreased from $34,238 at December 31, 1994 to $20,932 at March
31, 1995, due to a decrease in percentage rent generated by the properties from
the fourth quarter of 1994 to the first quarter of 1995. Accounts payable
decreased from December 31, 1994 to March 31, 1995 as a result of the timing of
the payment of audit fees.
During 1995, the Partnership will explore the feasibility of selling the
Partnership's remaining 24 properties. Until all of the properties are sold,
the Partnership will continue to operate, and it is intended that net income
earned by the Partnership will be distributed to the partners in accordance
with the terms of the Partnership Agreement.
Results of Operations
The Partnership generated net income for the three months ended March 31, 1995
of $312,765 compared to $292,627 for the corresponding period in 1994. The
increase in net income is primarily attributable to increased percentage rental
income resulting from higher sales at the properties. Rental income for the
three months ended March 31, 1994 was $506,033 compared to $487,882 for the
corresponding period in 1994.
Interest income also contributed to the increase in net income over the prior
period due to an increase in interest rates during the past year. For the
three months ended March 31, 1995, interest income was $7,003 compared to
$3,258 for the corresponding period in 1994.
Ground lease rent increased to $69,216 for the three months ended March 31,
1995 compared to $64,396 for the corresponding period in 1994. The increase in
ground lease rent expense was a result of scheduled rent escalations in the
Partnership's ground leases. Increases in ground rents are passed on to the
franchisees in the form of increased rents paid to the Partnership.
PART II OTHER INFORMATION
Items 1-5 Not applicable
Item 6 Exhibits and reports on Form 8-K.
(a) Exhibits - None
(b) Reports on Form 8-K - No reports on Form 8-K were filed during
the quarter ended March 31, 1995
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.
BURGER KING LIMITED PARTNERSHIP III
BY: BK III RESTAURANTS INC.
General Partner
Date: May 12, 1995 BY: /s/ Rocco Andriola
Name: Rocco Andriola
Title: Director, President and Chief Financial
Officer
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<PERIOD-END> MAR-31-1995
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