UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-----------------------
FORM 10-Q
Quarterly Report Under Section 13 or 15(d)
of the United States Securities Exchange Act of 1934
-----------------------
For The Quarter Ended September 30, 1996 Commission File No. 2-92914
COLUMBIA LEASE INCOME FUND A L.P.
(Exact name of registrant as specified in its charter)
Delaware 13-3263094
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Financial Center, 21st Floor, Boston, MA 02111
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 482-8000
-------------------------
Not Applicable
(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 ___
There are no Exhibits.
Page 1 of 12
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COLUMBIA LEASE INCOME FUND A L.P.
(A Delaware Limited Partnership)
<S> <C> <C>
INDEX Page No.
Part I. FINANCIAL INFORMATION
Financial Statements
Balance Sheets as of September 30, 1996 and December 31, 1995 3
Statements of Operations For the Quarters Ended
September 30, 1996 and 1995 and For the Nine Months Ended
September 30, 1996 and 1995 4
Statements of Cash Flows For the Nine Months Ended
September 30, 1996 and 1995 5
Notes to Financial Statements 6 - 7
Management's Discussion and Analysis of Financial Condition and
Results of Operations 8 - 10
Part II. OTHER INFORMATION
Items 1 - 6 11
Signature 12
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PART I. FINANCIAL INFORMATION
COLUMBIA LEASE INCOME FUND A L.P.
(A Delaware Limited Partnership)
Balance Sheets
Assets
(Unaudited) (Audited)
9/30/96 12/31/95
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<S> <C> <C>
Investment property, at cost (note 3):
Computer equipment $ 1,458,211 $ 1,814,444
Less accumulated depreciation 1,364,290 1,658,660
---------------- ----------------
Investment property, net 93,921 155,784
Cash and cash equivalents 127,594 71,333
Rents receivable, net (note 2) 8,470 25,414
Accounts receivable - affiliates, net (note 2) 4,794 2,758
---------------- ----------------
Total assets $ 234,779 $ 255,289
================ ================
Liabilities and Partners' Equity
Liabilities:
Accounts payable and accrued expenses - affiliates (note 4) $ 29,371 $ 31,741
Accounts payable and accrued expenses 18,732 20,693
Distributions payable (note 5) 96,248 64,166
---------------- ----------------
Total liabilities 144,351 116,600
---------------- ----------------
Partners' equity:
General Partner:
Capital contribution 1,000 1,000
Cumulative net income 238,399 229,583
Cumulative cash distributions (642,127) (630,895)
Reallocation of capital accounts 402,728 400,312
---------------- ----------------
- -
---------------- ----------------
Limited Partners (24,383 units):
Capital contribution, net of
offering costs 10,484,690 10,484,690
Cumulative net income 4,529,575 4,362,073
Cumulative cash distributions (14,521,109) (14,307,762)
Reallocation of capital accounts (402,728) (400,312)
---------------- ----------------
90,428 138,689
---------------- ----------------
Total partners' equity 90,428 138,689
---------------- ----------------
Total liabilities and partners' equity $ 234,779 $ 255,289
================ ================
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See accompanying notes to financial statements.
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<CAPTION>
COLUMBIA LEASE INCOME FUND A L.P.
(A Delaware Limited Partnership)
Statements of Operations
(Unaudited)
Quarters Ended Nine Months Ended
September 30, September 30,
------------------------------- --------------------------------
1996 1995 1996 1995
------------------------------- --------------------------------
<S> <C> <C> <C> <C>
Revenue:
Rental income on operating leases $ 84,408 $ 97,528 $ 241,843 $ 421,962
Earned income on
direct financing lease - - - 7,018
Interest income 1,266 1,278 3,348 4,342
------------ ------------- ------------ ------------
Total revenue 85,674 98,806 245,191 433,322
------------ ------------- ------------ ------------
Costs and expenses:
Depreciation 18,390 52,383 56,783 239,243
Interest - 103 - 1,215
Related party expenses (note 4):
Management fees 6,503 9,096 19,067 30,052
General and administrative 21,199 20,689 63,491 57,812
Net loss (gain) on sale
of equipment 1,131 94,121 (10,468) 87,974
(Reversal of) provision for
doubtful accounts - - (60,000) 1,029
------------ ------------- ------------ ------------
Total costs and expenses 47,223 176,392 68,873 417,325
------------ ------------- ------------ ------------
Net income $ 38,451 $ (77,586) $ 176,318 $ 15,997
============ ============= ============ ============
Net income per Limited
Partnership Unit $ 1.50 $ (3.02) $ 6.87 $ 0.63
============ ============= ============ ============
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See accompanying notes to financial statements.
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<CAPTION>
COLUMBIA LEASE INCOME FUND A L.P.
(A Delaware Limited Partnership)
Statements of Cash Flows
For the Nine Months Ended September 30, 1996 and 1995
(Unaudited)
1996 1995
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<S> <C> <C>
Cash flows from operating activities:
Net income $ 176,318 $ 15,997
--------------- ----------------
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation 56,783 239,243
(Reversal of) provision for doubtful accounts (60,000) 1,029
Net (gain) loss on sale of equipment (10,468) 87,974
Net decrease in current assets 74,908 62,584
Net decrease in current liabilities (4,331) (39,771)
--------------- ----------------
Total adjustments 56,892 351,059
--------------- ----------------
Net cash provided by operating activities 233,210 367,056
--------------- ----------------
Cash flows from investing activities:
Proceeds from sales of investment property 15,548 14,881
--------------- ----------------
Net cash provided by investing activities 15,548 14,881
--------------- ----------------
Cash flows from financing activities:
Principal payments on long-term debt - (37,801)
Cash distributions to partners (192,497) (481,245)
--------------- ----------------
Net cash used in financing activities (192,497) (519,046)
--------------- ----------------
Net increase (decrease) in cash and cash equivalents 56,261 (137,109)
Cash and cash equivalents at beginning of period 71,333 227,793
--------------- ----------------
Cash and cash equivalents at end of period $ 127,594 $ 90,684
=============== ================
Supplemental cash flow information:
Interest paid during the period $ - $ 1,215
=============== ================
Non-cash investing activities:
Reclassification of expired direct financing
lease to operating lease $ - $ 4,198
=============== ================
</TABLE>
See accompanying notes to financial statements.
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COLUMBIA LEASE INCOME FUND A L.P.
(A Delaware Limited Partnership)
Notes to Financial Statements
For the Nine Months Ended September 30, 1996 and September 30, 1995
(Unaudited)
(1) Basis of Presentation
The foregoing financial statements of Columbia Lease Income Fund A L.P. (the
"Partnership") have been prepared in accordance with the rules and regulations
of the Securities and Exchange Commission for Form 10-Q and reflect all
adjustments which are, in the opinion of management, necessary for a fair
presentation of the results for the interim periods presented. Pursuant to such
rules and regulations, certain note disclosures which are normally required
under generally accepted accounting principles have been omitted. It is
recommended that these financial statements be read in conjunction with the
Partnership's Annual Report on Form 10-K for the year ended December 31, 1995.
(2) Significant Accounting Policies
Allowance for Doubtful Accounts
The financial statements include allowances for estimated losses on receivable
balances. The allowances for doubtful accounts are based on past write off
experience and an evaluation of potential uncollectible accounts within the
current receivable balances. Receivable balances which are determined to be
uncollectible are charged against the allowance and subsequent recoveries, if
any, are credited to the allowance. At September 30, 1996 and December 31, 1995,
the allowance for doubtful accounts included in rents receivable was $2,426 for
each period, and the allowance for doubtful accounts included in accounts
receivable - affiliates was $0 and $60,000, respectively.
(3) Investment Property
At September 30, 1996, the Partnership owned computer equipment with a
depreciated cost basis of $93,921, subject to existing leases. All purchases of
computer equipment are subject to a 2.5% acquisition fee paid to the General
Partner.
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COLUMBIA LEASE INCOME FUND A L.P.
(A Delaware Limited Partnership)
Notes to Financial Statements
For the Nine Months Ended September 30, 1996 and September 30, 1995
(Unaudited)
(4) Related Party Transactions
Fees, commissions and other expenses paid or accrued by the Partnership to the
General Partner or affiliates of the General Partner for the nine months ended
September 30, 1996 and 1995 are as follows:
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1996 1995
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<S> <C> <C>
Management fees $ 19,067 $ 30,052
Reimbursable expenses paid 59,630 59,285
----------- -----------
$ 78,697 $ 89,337
=========== ===========
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Under the terms of the Partnership Agreement, the General Partner is entitled to
an equipment acquisition fee of 2.5% of the purchase price paid by the
Partnership for the equipment. The General Partner is also entitled to a
management fee equal to 6% of the monthly rental billings, paid monthly, based
on rents received. The Partnership reimburses the General Partner and its
affiliates for certain expenses incurred by them in connection with the
operation of the Partnership.
(5) Distributions to Partners
For the nine months ended September 30, 1996, the declaration of Distributable
Cash was as follows:
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<CAPTION>
Limited Partners
General
Date Paid Distribution Partner
Quarter Ended or Payable Per $ 500 Unit Total Total
- ------------- ---------- -------------- ----- -----
<S> <C> <C> <C> <C>
March 31, 1996 May 15, 1996 $ 2.50 $ 60,958 $ 3,208
June 30, 1996 August 15, 1996 $ 2.50 $ 60,958 $ 3,208
September 30, 1996 November 15, 1996 $ 3.75 $ 91,436 $ 4,812
</TABLE>
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COLUMBIA LEASE INCOME FUND A L.P.
(A Delaware Limited Partnership)
Management's Discussion and Analysis of
Financial Condition and Results of Operation
(Unaudited)
Results of Operations
The following discussion relates to the Partnership's operations for the quarter
and nine month periods ended September 30, 1996, compared to the same periods in
1995.
The Partnership realized net income of $38,451 and net loss of $77,586 for the
three month periods ended September 30, 1996 and 1995, respectively. Rental
income on operating leases decreased $13,120 or 13% between the three month
periods. The decrease in rental income is due to lower rental rates obtained on
equipment lease extensions and remarketings after the initial lease term expires
and due to a decrease in the size of the equipment portfolio.
Total costs and expenses decreased $129,169 or 73% between the three month
periods. The decrease in costs and expenses is the result of a significant
decrease in net loss on sale of equipment. The decrease in net loss on sale of
equipment can be attributed to sales of equipment carrying lower net book
values. Depreciation expense decreased $33,993 or 65% due to a large portion of
the equipment portfolio becoming fully depreciated and a reduction in the
overall equipment portfolio. Management fees have decreased due to the decline
in rental income. General and administrative expenses increased between the
three month periods due to an increase in the allocable salaries of the
partnership accounting and reporting personnel of the General Partner.
The Partnership realized net income of $176,318 and $15,997 for the nine month
periods ended September 30, 1996 and 1995, respectively. Rental income on
operating leases decreased $180,119 or 43%. As discussed in the quarter analysis
above, the decrease in rental income is primarily due to lower rental rates
obtained on equipment lease extensions and remarketings after the initial lease
term has expired and due to a decrease in the overall size of the equipment
portfolio. No earned income on direct financing leases has been recognized
during the current year due to the complete allocation of the lease payments to
the fair market value of the equipment over the lease terms in 1995. Interest
income decreased $994 between 1995 and 1996 due to the Partnership carrying
lower average short-term investment balances.
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COLUMBIA LEASE INCOME FUND A L.P.
(A Delaware Limited Partnership)
Management's Discussion and Analysis of
Financial Condition and Results of Operation
(Unaudited)
Total costs and expenses decreased $348,452 or 83% between the nine month
periods. The decrease in costs and expenses can be attributed to a net gain on
sale of equipment combined with the reduction in depreciation expense during the
current year. The net gain on sale of equipment during the nine month period can
be attributed to sales of equipment carrying lower net book values as compared
to a net loss on sale of equipment during the prior year. The decrease in
depreciation expense of $182,460 is due to a large portion of the equipment
portfolio becoming fully depreciated and a reduction in the overall equipment
portfolio. The $60,000 reversal of the provision for doubtful accounts in the
current year, reflects the successful collection of a sales proceed receivable,
that had been fully reserved in a prior period. Management fees have decreased
due to the decline in rental income. General and administrative expenses
increased $5,679 or 10% between the nine month periods. As discussed in the
quarter analysis above, the increase in general and administrative expenses is
due to an increase in the allocable salaries of the partnership accounting and
reporting personnel of the General Partner.
The Partnership recorded net income per Limited Partnership Unit of $1.50 and
$(3.02) for the quarters ended September 30, 1996 and 1995, respectively, and
$6.87 and $.63 for the nine month periods ended September 30, 1996 and 1995,
respectively.
Liquidity and Capital Resources
For the nine months ended September 30, 1996, rental revenue generated from
operating leases was the primary source of funds for the Partnership. As
equipment leases terminate, the General Partner determines if the equipment will
be extended to the same lessee, remarketed to another lessee, or if it is less
marketable, sold. This decision is made upon analyzing which option would
generate the most favorable results.
Rental income on operating leases will continue to decrease due to two factors.
First, lower rates are obtained on the remarketing of existing equipment after
the expiration of the original lease. Typically, the remarketed rates are lower
due to the decrease in useful life of the equipment. Second, the increasing
change of technology in the computer industry usually decreases the demand for
older equipment, thus increasing the possibility of obsolescence. Both of these
factors together will cause remarketed rates to be lower than original rates.
This decrease however, should not affect the Partnership's ability to meet its
future cash requirements. To the extent that future cash flows should be
insufficient to meet the Partnership's operating expenses and liabilities,
additional funds could be obtained through the sale of equipment, or a reduction
in the rate of cash distributions. Future rental revenues from operating leases
amount to $130,889 and are to be received over the next two years.
For the nine months ended September 30, 1996, the Partnership's investing
activities resulted in sales of computer equipment generating proceeds of
$15,548. The Partnership has no material capital expenditure commitments, and
will not purchase equipment in the future as the Partnership has reached the end
of its reinvestment period.
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COLUMBIA LEASE INCOME FUND A L.P.
(A Delaware Limited Partnership)
Management's Discussion and Analysis of
Financial Condition and Results of Operation
(Unaudited)
Cash distributions are currently at an annual level of 3% per Limited
Partnership Unit, or $3.75 per Limited Partnership Unit on a quarterly basis.
For the quarter ended September 30, 1996, the Partnership declared a cash
distribution of $96,248, of which $4,812 was allocated to the General Partner
and $91,436 was allocated to the Limited Partners. The distribution will be paid
on November 15, 1996. The Partnership expects to continue paying at or near this
level. The effects of inflation have not been significant to the Partnership and
are not expected to have a material impact in future periods.
On January 9, 1996, TLP Holding LLC purchased all the common stock of TLP
Leasing Programs, Inc. from CMI Holding Co. Under the new ownership, it is
expected that TLP Leasing Programs, Inc. will continue to operate in the same
manner of business as it has in the past.
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PART II. OTHER INFORMATION
COLUMBIA LEASE INCOME FUND A L.P.
(A Delaware Limited Partnership)
<S> <C>
Item 1. Legal Proceedings
Response: None
Item 2. Changes in the Rights of the Partnership's Security Holders
Response: None
Item 3. Defaults by the Partnership on its Senior Securities
Response: None
Item 4. Results of Votes of Security Holders
Response: None
Item 5. Other Information
Response: None
Item 6. Exhibits and Reports on Form 8-K
Response:
A. None
B. None
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SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) 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.
COLUMBIA LEASE INCOME FUND A L.P.
(Registrant)
By: TLP Columbia Management Corporation,
its General Partner
Date: November 14, 1996
By: Arthur P. Beecher,
President
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000751683
<NAME> COLUMBIA I-A 9/30/96
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> SEP-30-1996
<CASH> 127,594
<SECURITIES> 0
<RECEIVABLES> 15,690
<ALLOWANCES> 2,426
<INVENTORY> 0
<CURRENT-ASSETS> 140,858
<PP&E> 1,458,211
<DEPRECIATION> 1,364,290
<TOTAL-ASSETS> 234,779
<CURRENT-LIABILITIES> 144,351
<BONDS> 0
<COMMON> 10,485,690
0
0
<OTHER-SE> (10,395,262)
<TOTAL-LIABILITY-AND-EQUITY> 234,779
<SALES> 241,843
<TOTAL-REVENUES> 245,191
<CGS> 0
<TOTAL-COSTS> 19,067
<OTHER-EXPENSES> 109,806
<LOSS-PROVISION> (60,000)
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 176,318
<INCOME-TAX> 0
<INCOME-CONTINUING> 176,318
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 176,318
<EPS-PRIMARY> 6.87
<EPS-DILUTED> 0
</TABLE>
