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 March 31, 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)
591 West Los Angeles Avenue, Moorpark, CA 93021
(Address of principal executive office) (Zip Code)
(805) 530-3858
(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
March 31, September 30,
1998 1997
(Unaudited)
--------- ------------
<S> <C> <C>
ASSETS
Assets:
Cash and cash equivalents $ 487,000 $ 656,000
Notes receivable 646,000 807,000
Inventories of growing crops 15,000 15,000
Accrued interest receivable 19,000 32,000
Property held for sale 1,195,000 1,159,000
Other assets 19,000 16,000
---------- ----------
TOTAL ASSETS $2,381,000 $2,685,000
========= =========
LIABILITIES AND PARTNERS' EQUITY
Liabilities:
Accounts payable and accrued
liabilities $ 41,000 $ 49,000
---------- ----------
TOTAL LIABILITIES 41,000 49,000
Partners' equity 2,340,000 2,636,000
---------- ---------
TOTAL LIABILITIES AND
PARTNERS' EQUITY $2,381,000 $2,685,000
========= =========
See accompanying notes to financial statements
</TABLE>
<TABLE>
GREEN GOLD CONSOLIDATED
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF OPERATIONS
(Unaudited)
For the Six Months Ending
March 31,
1998 1997
----------- ---------
<S> <C> <C>
CROP SALES $ 110,000 $ 82,000
OPERATING COSTS AND EXPENSES:
Cultural Cae Costs 80,000 96,000
Professional services 77,000 66,000
Depreciation, property tax and other 42,000 29,000
----------- ----------
Total Operating Costs and Expenses 199,000 191,000
LOSS FROM OPERATIONS (89,000) (109,000)
OTHER INCOME (EXPENSES):
Realized gross profit 27,000 14,000
Interest income 91,000 101,000
Other income 6,000 7,000
---------- ----------
NET INCOME $ 35,000 $ 13,000
=========== ==========
NET INCOME PER LIMITED
PARTNERSHIP INTEREST $ .0035 $ .0013
=========== ===========
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 Three Months Ending
March 31,
1998 1997
---------- ---------
<S> <C> < c>
CROP SALES $ 74,000 $ 82,000
Cultural Care Costs 40,000 52,000
Professional Services 40,000 37,000
Depreciation, property tax and other 8,000 4,000
---------- ---------
Total Operating Costs and Expenses 88,000 93,000
INCOME (LOSS) FROM OPERATIONS (14,000) (11,000)
OTHER INCOME (EXPENSES):
Realized gross profit 25,000 8,000
Interest Income 45,000 47,000
Other Income 2,000 2,000
---------- ---------
NET INCOME $ 58,000 $ 46,000
========== =========
NET INCOME PER LIMITED
PARTNERSHIP INTEREST $ .0058 $ .0046
========== =========
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 Six Months Ended March 31, 1998 and 1997
(Unaudited)
March 31, March 31,
1998 1997
----------- ----------
<S> <C> <C>
Cash flows from operating activities:
Net income $ 35,000 $ 13,000
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation and amortization -0- 1,000
Deferred profit recognized (27,000) (14,000)
Changes in assets and liabilities:
Decrease in interest receivables 13,000 5,000
(Increase) decrease in other assets (3,000) 1,000
(Decrease) increase in accounts payable
and accrued liabilities (8,000) 1,000
------------ ----------
Net cash provided by operating activities 10,000 7,000
------------ ----------
Cash flows from investing activities:
Collection on notes receivable 152,000 31,000
------------ ----------
Net cash provided by investing
activities 152,000 31,000
------------ ----------
Cash flows from financing activities:
Distributions to limited partners (320,000) (250,000)
Distributions to general partner (11,000) (12,000)
----------- ----------
Net cash used by financing
activities (331,000) (262,000)
----------- ----------
Net (decrease) in cash (169,000) (224,000)
Cash at September 30 656,000 591,000
--------- ---------
Cash at March 31 $ 487,000 $ 367,000
========= =========
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:
March 31, September 30,
1998 1997
--------- -----------
First trust deed notes $ 1,398,000 $ 1,693,000
Less:
Deferred profit on real estate sales (653,000) (787,000)
Allowance for doubtful accounts (99,000) (99,000)
---------- ---------
$ 646,000 $ 807,000
========== ==========
D. PROPERTY
Property is comprised of the following:
March 31, 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 March 31, 1998, were $74,000, compared to
$82,000 for the same quarter in 1997. The quarterly decrease in crop revenue is
attributed to picking 124,000 pounds of avocados this quarter compared to
131,000 the prior year's quarter ended March 31. Crop prices for the quarter
ended March 31, 1998, averaged $.59 per pound compared to $.63 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 March 31, 1998, decreased
$5,000, from $93,000 to $88,000. Cultural care costs decreased $12,000 from
$52,000 to $40,000. The main reason for the decrease results from significantly
reduced irrigation and water costs due to the heavy rainfall.
Professional Services increased $3,000 from $37,000 to $40,000. The increase
results from investor services costs related to the conversion to Windows and
payment of the 2% of gross partnership cash receipts to the "manager" for its
services which was higher than the prior quarter ended March 31, due to a loan
payoff.
Other expenses increased $4,000 from $4,000 to $8,000 mainly as a result of
$3,000 in property taxes paid on one parcel foreclosed in the quarter ended
December 31, 1997.
Other income increased $12,000 from $46,000 to $58,000. The increase is
mainly attributed to recognizing deferred profit of $25,000 from the early
payoff of one note totaling $118,000 during the quarter ended March 31, 1998.
There were no sales in the quarter ended March 31, 1998. The marketing and
sales program is actively underway for all of the remaining 17 parcels totaling
165 acres. Sales activity is increasing and we expect offers on several parcels
next quarter.
Liquidity and Capital Resources
As of March 31, 1998, the Partnership has cash reserves of approximately
$451,000 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 March 31, 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: May 13, 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
