FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1998
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 0-11533
GREEN GOLD CONSOLIDATED
__________________________________________________________
(Exact name of registrant as specified in its charter)
CALIFORNIA 33-0023916
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification Number)
711 Daily Drive, Suite 120, Camarillo, CA 93010
(Address of principal executive office) (Zip Code)
(805) 987-6921
(Registrant's telephone number, including area code)
N/A
(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 [ ]
<TABLE>
PART I - FINANCIAL INFORMATION
Item 1. FINANCIAL STATEMENTS
GREEN GOLD CONSOLIDATED
(A CALIFORNIA LIMITED PARTNERSHIP)
BALANCE SHEET
June 30, September 30,
1998 1997
(Unaudited)
--------- ------------
<S> <C> <C>
ASSETS
Assets:
Cash and cash equivalents $ 638,000 $ 656,000
Notes receivable 573,000 807,000
Inventories of growing crops 15,000 15,000
Accrued interest receivable 21,000 32,000
Property held for sale 1,195,000 1,159,000
Other assets 19,000 16,000
---------- ----------
TOTAL ASSETS $2,461,000 $2,685,000
========= =========
LIABILITIES AND PARTNERS' EQUITY
Liabilities:
Accounts payable and accrued
liabilities $ 47,000 $ 49,000
---------- ----------
TOTAL LIABILITIES 47,000 49,000
Partners' equity 2,414,000 2,636,000
---------- ---------
TOTAL LIABILITIES AND
PARTNERS' EQUITY $2,461,000 $2,685,000
========= =========
See accompanying notes to financial statements
</TABLE>
<TABLE>
GREEN GOLD CONSOLIDATED
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF OPERATIONS
(Unaudited)
For the Nine Months Ending
June 30,
1998 1997
----------- ---------
<S> <C> <C>
CROP SALES $ 224,000 $ 223,000
OPERATING COSTS AND EXPENSES:
Cultural care 125,000 155,000
Professional services 103,000 94,000
Depreciation, property tax and other 74,000 63,000
----------- ----------
Total operating costs and expenses 302,000 312,000
LOSS FROM OPERATIONS (78,000) (89,000)
OTHER INCOME (EXPENSES):
Realized gross profit 45,000 137,000
Interest income 135,000 148,000
Other income 7,000 8,000
---------- ----------
NET INCOME $ 109,000 $ 204,000
=========== ==========
NET INCOME PER LIMITED
PARTNERSHIP INTEREST $ .0109 $ .0204
=========== ===========
Weighted average number of limited partnership
interests outstanding during the period used
to compute earnings per limited partnership
interest 9,986,000 9,986,000
========= =========
See accompanying notes to financial statements
</TABLE>
<TABLE>
GREEN GOLD CONSOLIDATED
(A CALIFORNIA LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS
(Unaudited)
For the Three Months Ending
June 30,
1998 1997
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<S> <C> < c>
CROP SALES $ 114,000 $ 142,000
OPERATING COSTS AND EXPENSES:
Cultural care 45,000 59,000
Professional services 25,000 28,000
Depreciation, property tax and other 32,000 34,000
---------- ---------
Total operating costs and expenses 102,000 121,000
INCOME FROM OPERATIONS 12,000 21,000
OTHER INCOME (EXPENSES):
Realized gross profit 18,000 122,000
Interest income 44,000 47,000
Other income -0- 1,000
---------- ---------
NET INCOME $ 74,000 $ 191,000
========== =========
NET INCOME PER LIMITED
PARTNERSHIP INTEREST $ .0074 $ .0191
========== =========
Weighted average number of limited partnership
interests outstanding during the period used
to compute earnings per limited partnership
interest 9,986,000 9,986,000
========= =========
See accompanying notes to financial statements
</TABLE>
<TABLE>
GREEN GOLD CONSOLIDATED
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENT OF CASH FLOWS
For the Nine Months Ended June 30, 1998 and 1997
(Unaudited)
June 30, June 30,
1998 1997
----------- ----------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 109,000 $ 204,000
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation and amortization -0- 1,000
Deferred profit recognized (45,000) (137,000)
Changes in assets and liabilities:
Decrease in receivables 11,000 10,000
(Increase) decrease in other assets (3,000) 1,000
Decrease in accounts payable and
accrued liabilities (2,000) (11,000)
------------ ----------
Net cash provided by operating activities 70,000 68,000
------------ ----------
Cash flows from investing activities:
Collection on notes receivable 243,000 204,000
------------ ----------
Net cash provided by investing
activities 243,000 204,000
------------ ----------
Cash flows from financing activities:
Distributions to limited partners (320,000) (250,000)
Distributions to general partner (11,000) (10,000)
----------- ----------
Net cash used by financing
activities (331,000) (260,000)
----------- ----------
Net (decrease) increase in cash (18,000) 12,000
Cash at September 30 656,000 591,000
--------- ---------
Cash at June 30 $ 638,000 $ 603,000
========= =========
See accompanying notes to financial statements
</TABLE>
GREEN GOLD CONSOLIDATED
(A CALIFORNIA LIMITED PARTNERSHIP)
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
A. SIGNIFICANT ACCOUNTING POLICIES
Property and Depreciation - Property is stated at the lower of cost or net
realizable value. Depreciation is provided on a straight-line method over
the estimated useful lives of the respective assets.
Inventories - Inventories, consisting of growing crops, is valued at the
lower of cost or net realizable value under the first-in, first-out (FIFO)
method. Cost is defined as cultural care costs related to the growing
crops.
Income Taxes - The Partnership reports its tax returns on the cash basis of
accounting. No provision for income taxes is included in the accompanying
financial statements as the Partnership's results of operations are
distributed to the partners for inclusion in their respective income tax
returns.
Profit Recognition on Real Estate Sales - It is the Partnership's policy to
defer profit on real estate sales until such time as the purchaser's
cumulative investment and continued involvement in the property meet the
minimum criteria for full profit recognition as set forth in the Financial
Accounting Standards Board Statement No. 66, Accounting for Sales of Real
Estate. Until such time as profit can be recognized under the full accrual
method, the cost recovery and installment methods are used.
Net Income Per Limited Partnership Interest - Net income per limited
partnership interest was calculated using the weighted average of limited
partnership interests outstanding during the year and the Limited Partners'
share of the net income.
B. GENERAL
Green Gold Consolidated was organized in accordance with the Provisions
of the California Uniform Limited Partnership Act for the purpose of
receiving the assets and liabilities of twelve limited partnerships under
common management and thereby consolidating the operations of those
partnerships under an exchange transaction effective June 30, 1983. Under
the exchange transaction, the Partnership issued 10,000,000 limited
partnership interests (pro rata) to the holders of interests in the twelve
individual limited partnerships in exchange for the assets and liabilities
of those partnerships.
Under the provisions of the partnership agreement, profits and losses are
allocated in the ratio of 93.5% to the Limited Partners and 6.5% to the
General Partner, provided that prior to the first fiscal quarter during
which a distribution is made to the General Partner from the proceeds of
the property sales or refinancing, all gains and losses resulting from
property sales are allocated in the ratio of 99% to the Limited Partners
and 1% to the General Partner.
The combination of the twelve partnerships into one partnership was treated
as a reorganization of entities under common control, accounted for similar
to a "pooling of interest".<PAGE>
C. NOTES RECEIVABLE
Notes receivable consist of the following as of:
June 30, September 30,
1998 1997
--------- -----------
First trust deed notes $ 1,307,000 $ 1,693,000
Less:
Deferred profit on real estate sales (635,000) (787,000)
Allowance for doubtful accounts (99,000) (99,000)
---------- ---------
$ 573,000 $ 807,000
========== ==========
D. PROPERTY
Property is comprised of the following:
June 30, September 30,
1998 1997
Land $1,195,000 $1,159,000
Farm equipment 151,000 151,000
Trees 276,000 276,000
--------- ---------
Total 1,622,000 1,586,000
Accumulated depreciation (427,000) (427,000)
---------- ----------
$1,195,000 $1,159,000
========= =========
E. EARNINGS (LOSS) PER LIMITED PARTNERSHIP INTEREST
Earnings (loss) per limited partnership interest have been computed by
dividing the aggregate limited partners' share of net income (loss) by the
weighted average number of limited partnership interests outstanding during
the period, 9,986,000 in 1998 and 1997, respectively.
F. MANAGEMENT AGREEMENT
The Partnership has an agreement with Las Posas Investment Company and
Mr. Neno Spondello, Jr. to manage and market the Partnership properties.
G. STATEMENT BY MANAGEMENT
In the opinion of the Management, the financial information presented
herein reflects all adjustments which are necessary to a fair statement of
the results for the interim periods presented.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Results of Operations
Crop sales for the quarter ended June 30, 1998, were $114,000, compared to
$142,000 for the same quarter in 1997. The quarterly decrease in crop revenue
is attributed to picking 140,000 pounds of avocados this quarter compared to
204,000 the prior year's quarter ended June 30. Crop prices for the quarter
ended June 30, 1998, averaged $.81 per pound compared to $.69 per pound in
the same quarter in 1997. Avocado production in 1998 is budgeted at 487,000
pounds; however, this may vary somewhat based on weather conditions, the
impact of the normal tree cycle and the effects of the "avocado" persea mite.
Pounds produced in 1997 were 416,000.
Operating costs and expenses for the quarter ended June 30, 1998, decreased
$19,000, from $121,000 to $102,000. Cultural care costs decreased $14,000 from
$59,000 to $45,000. The main reason for the decrease results from reduced
irrigation and water costs due to the earlier heavy rainfall and reduced
picking costs as as a result of picking 64,000 pounds less this quarter compared
to the same quarter 1997.
Professional Services decreased $3,000 from $28,000 to $25,000. The decrease
results from reduction in investor services costs and payment of the 2% of
cash receipts to the "manager" for its services compared to the same quarter
1997.
Other expenses decreased $2,000 from $34,000 to $32,000. The main reason for
the decrease is the combined effect of a $9,000 system costs decrease from the
prior quarter associated with upgrades of software and hardware, and a $6,000
payment of property tax for 97-98 taxes for a parcel foreclosed in the quarter
ended December 31, 1997.
Other income decreased $117,000 from $191,000 to $74,000. The decrease is
mainly attributed to recognizing deferred profit of $116,000 from the early
payoff of one note totaling $155,000 during the prior year quarter ended
June 30, 1997.
Offers have been accepted on six parcels in the quarter ended June 30, 1998,
compared to none for the same quarter 1997. The gross sales amount for all
parcels is $621,000. All sales are in escrow and are expected to close in the
next quarter ended September 30, 1998. The marketing and sales program is
actively underway for the remaining 11 parcels totaling 109 acres. Costs
associated with installing water meters and splitting irrigation systems are
estimated at $50,000.
Liquidity and Capital Resources
As of June 30, 1998, the Partnership has cash reserves of approximately
$601,000 to cover operating expenses and the small amount of remaining real
estate development costs. This is expected to be sufficient to comply with the
business plan.
PART II
OTHER INFORMATION
Item 6. EXHIBITS AND REPORTS ON FORM 8-K
(b) No reports on Form 8-K were filed by the Registrant during the
quarter ended June 30, 1998.
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.
DATE: August 12, 1998 GREEN GOLD CONSOLIDATED,
a California limited partnership
(Registrant)
By: Economic Consultants,
a California Partnership,
General Partner
By: /s/Daniel Lee Stephenson
Daniel Lee Stephenson,
General Partner
By: /s/Tom A. Leevers
Tom A. Leevers,
General Partner
