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 Quarter Ended June 30, 1997 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 11
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COLUMBIA LEASE INCOME FUND A L.P.
(A Delaware Limited Partnership)
INDEX Page No.
Part I. FINANCIAL INFORMATION
<S> <C> <C>
Financial Statements
Balance Sheets as of June 30, 1997 and December 31, 1996 3
Statements of Operations
Quarters Ended June 30, 1997 and 1996 and
Six Months Ended June 30, 1997 and 1996 4
Statements of Cash Flows
Six Months Ended June 30, 1997 and 1996 5
Notes to Financial Statements 6 - 7
Management's Discussion and Analysis of Financial Condition and
Results of Operations 8 - 9
Part II. OTHER INFORMATION
Items 1 - 6 10
Signature 11
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PART I. FINANCIAL INFORMATION
COLUMBIA LEASE INCOME FUND A L.P.
(A Delaware Limited Partnership)
Balance Sheets
Assets
(Unaudited) (Audited)
6/30/97 12/31/96
---------------- ----------------
<S> <C> <C>
Investment property, at cost (note 3):
Computer equipment $ 1,412,572 $ 1,444,033
Less accumulated depreciation 1,358,292 1,367,883
---------------- ----------------
Investment property, net 54,280 76,150
Cash and cash equivalents 67,957 60,959
Rents receivable, net (note 2) 8,632 27,132
Sales receivable, net (note 2) - -
Accounts receivable - affiliates (note 4) - 8,956
---------------- ----------------
Total assets $ 130,869 $ 173,197
================ ================
Liabilities and Partners' Equity
Liabilities:
Accounts payable and accrued
expenses - affiliates (note 4) $ 22,398 $ 30,261
Accounts payable and accrued expenses 19,462 14,136
Distributions payable (note 5) 64,167 64,167
---------------- ----------------
Total liabilities 106,027 108,564
---------------- ----------------
Partners' equity:
General Partner:
Capital contribution 1,000 1,000
Cumulative net income 243,140 240,317
Cumulative cash distributions (650,143) (645,331)
Reallocation of capital accounts 406,003 404,014
---------------- ----------------
- -
---------------- ----------------
Limited Partners (24,383 units):
Capital contribution, net of
offering costs 10,484,690 10,484,690
Cumulative net income 4,619,664 4,566,029
Cumulative cash distributions (14,673,509) (14,582,072)
Reallocation of capital accounts (406,003) (404,014)
---------------- ----------------
24,842 64,633
---------------- ----------------
Total partners' equity 24,842 64,633
---------------- ----------------
Total liabilities and partners' equity $ 130,869 $ 173,197
================ ================
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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 Six Months Ended
June 30, June 30,
------------------------------- --------------------------------
1997 1996 1997 1996
------------------------------- --------------------------------
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Revenue:
Rental income on operating leases $ 63,888 $ 62,272 $ 136,381 $ 157,435
Interest income 733 1,427 1,457 2,082
Other income 50 - 50 -
Net gain on sale
of equipment 250 11,599 1,631 11,599
------------ ------------- ------------ ------------
Total revenue 64,921 75,298 139,519 171,116
------------ ------------- ------------ ------------
Costs and expenses:
Depreciation 10,935 19,195 21,871 38,393
Related party expenses (note 4):
Management fees 5,980 6,607 13,496 12,564
General and administrative 28,632 22,598 50,895 42,292
Reversal of provision for
doubtful accounts (650) (60,000) (3,201) (60,000)
------------ ------------- ------------ ------------
Total costs and expenses 44,897 (11,600) 83,061 33,249
------------ ------------- ------------ ------------
Net income $ 20,024 $ 86,898 $ 56,458 $ 137,867
============ ============= ============ ============
Net income per Limited
Partnership Unit $ .78 $ 3.38 $ 2.20 $ 5.37
============ ============= ============ ============
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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
Six Months Ended June 30, 1997 and 1996
(Unaudited)
1997 1996
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Cash flows from operating activities:
Net income $ 56,458 $ 137,867
--------------- ----------------
Adjustments to reconcile net income to net cash provided
by operating activities:
Depreciation 21,871 38,393
Reversal of provision for doubtful accounts (3,201) (60,000)
Net gain on sale of equipment (1,631) (11,599)
Net decrease in current assets 30,657 71,730
Net (decrease) increase in current liabilities (2,537) 6,329
--------------- ----------------
Total adjustments 45,159 44,853
--------------- ----------------
Net cash provided by operating activities 101,617 182,720
--------------- ----------------
Cash flows from investing activities:
Proceeds from sales of investment property 1,631 11,599
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Net cash provided by investing activities 1,631 11,599
--------------- ----------------
Cash flows from financing activities:
Cash distributions to partners (96,250) (128,332)
--------------- ----------------
Net cash used in financing activities (96,250) (128,332)
--------------- ----------------
Net increase in cash and cash equivalents 6,998 65,987
Cash and cash equivalents at beginning of period 60,959 71,333
--------------- ----------------
Cash and cash equivalents at end of period $ 67,957 $ 137,320
=============== ================
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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
Six Months Ended June 30, 1997 and June 30, 1996
(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, 1996.
(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 June 30, 1997 and December 31, 1996, the
allowance for doubtful accounts included in rents receivable was $733 and
$5,284, respectively, and $1,350 and $0 included in sales receivable,
respectively.
(3) Investment Property
At June 30, 1997, the Partnership owned computer equipment with a depreciated
cost basis of $54,280, 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
Six Months Ended June 30, 1997 and June 30, 1996
(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 six months ended
June 30 are as follows:
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1997 1996
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Management fees $ 13,496 $ 12,564
Reimbursable expenses paid 43,718 45,457
------------ ------------
$ 57,214 $ 58,021
============ ============
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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. In addition, 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 six months ended June 30, 1997, the declaration of Distributable Cash
was as follows:
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Limited Partners
General
Date Paid Distribution Partner
Quarter Ended or Payable Per $ 500 Unit Total Total
- -------------- ---------- -------------- ----- -----
<S> <C> <C> <C> <C>
March 31, 1997 May 15, 1997 $ 1.25 $ 30,479 $ 1,604
June 30, 1997 August 15, 1997 $ 2.50 $ 60,958 $ 3,208
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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 Operations
(Unaudited)
Results of Operations
The following discussion relates to Partnership's operations for the quarter and
six months ended June 30, 1997 in comparison to the same periods ended June 30,
1996.
The Partnership realized net income of $20,024 and $86,898 for the quarters
ended June 30, 1997 and 1996, respectively. Rental income on operating leases
increased $1,616 or 3% between the three month periods. The increase in rental
income between the two periods is due to favorable rates on equipment lease
extensions during the current quarter. Interest income decreased as a result of
lower average short-term cash balances held during the current quarter. Other
income in 1997 is the result of a sales tax refund received from the State of
Colorado. The decrease in net gain on sale of equipment in the current quarter
is primarily due to a smaller number of equipment sales.
Total costs and expenses increased $56,497 or 487% in 1997. The significant
increase in costs and expenses is primarily due to the $60,000 reversal of
provision for doubtful accounts recorded in 1996. Depreciation expense decreased
$8,260 or 43% due to a large portion of the equipment portfolio becoming fully
depreciated and due to a reduction in the overall equipment portfolio.
Management fees decreased slightly in correlation to the decline in rents
actually received between the two periods. General and administrative expenses
increased $6,034. A major factor contributing to this increase is that the
reimbursable salaries and expenses of the partnership accounting and reporting
personnel of the General Partner are being allocated over a diminishing number
of partnerships under management. The $650 reversal of provision for doubtful
accounts in the current quarter is due to the successful collection efforts of
delinquent rents receivable.
The Partnership realized net income of $56,458 and $137,867 for the six months
ended June 30, 1997 and 1996, respectively. The $21,054 or 13% decrease in
rental income is attributed to lower rental rates obtained on equipment lease
extensions and remarketings resulting after the initial lease term expires.
Interest income decreased from 1996 as a result of lower cash balances held
during the current six month period. As mentioned above, other income is related
to a sales tax refund received from the State of Colorado. The decrease in net
gain on sale of equipment in 1997 is due to a smaller number of equipment sales
carrying high net book values.
Total costs and expenses increased $49,812 or 150% during the six month periods.
As was discussed in the quarter analysis above, the increase in costs and
expenses is primarily the result of the $60,000 reversal of provision for
doubtful accounts in 1996. The $16,522 or 43% decrease in depreciation expense
is primarily due to a large portion of the equipment portfolio becoming fully
depreciated and a reduction in the overall equipment portfolio. Management fees
increased mainly due to an increase in rental collections during the year.
General and administrative expenses increased $8,603 or 20% mainly due to an
increase in the allocable salaries of the partnership accounting and reporting
personnel of the General Partner during the current year. The $3,201 reversal of
provision for doubtful accounts is the result of successful collection efforts
of delinquent rents receivable in 1997.
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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 Operations
(Unaudited)
The Partnership recorded net income per Limited Partnership Unit of $.78 and
$3.38 for the quarters ended June 30, 1997 and 1996, respectively, and $2.20 and
$5.37 for the six month periods ended June 30, 1997 and 1996, respectively.
Liquidity and Capital Resources
For the six months ended June 30, 1997, 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 sold. This decision is made
upon analyzing which option generates the most favorable result.
Rental income on operating leases has continued to decrease due to two factors.
First, lower rates are usually obtained on the remarketing of existing equipment
upon 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 through a reduction in the rate of cash distributions. Future rental revenues
from operating leases amount to $132,312 and are to be received over the next
four years.
For the six months ended June 30, 1997, the Partnership's investing activities
generated $1,631 in sales proceeds on the sale of fully depreciated equipment
with an original cost basis of $31,461. 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.
Cash distributions are currently at an annual level of 2% per Limited
Partnership Unit, or $2.50 per Limited Partnership Unit on a quarterly basis.
For the quarter ended June 30, 1997, the Partnership declared a cash
distribution of $64,166, of which $3,208 was allocated to the General Partner
and $60,958 was allocated to the Limited Partners. The distribution will be paid
on August 15, 1997. 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.
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PART II. OTHER INFORMATION
COLUMBIA LEASE INCOME FUND A L.P.
(A Delaware Limited Partnership)
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
<PAGE>
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: August 13, 1997
By: Arthur P. Beecher,
President
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000751683
<NAME> FDS FOR COLUMBIA LEASE INCOME FUND A LP 6/30/97
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<CASH> 67,957
<SECURITIES> 0
<RECEIVABLES> 10,715
<ALLOWANCES> 2,083
<INVENTORY> 0
<CURRENT-ASSETS> 76,589
<PP&E> 1,412,572
<DEPRECIATION> 1,358,292
<TOTAL-ASSETS> 130,869
<CURRENT-LIABILITIES> 106,027
<BONDS> 0
0
0
<COMMON> 10,485,690
<OTHER-SE> (10,460,848)
<TOTAL-LIABILITY-AND-EQUITY> 130,869
<SALES> 136,381
<TOTAL-REVENUES> 139,519
<CGS> 0
<TOTAL-COSTS> 13,496
<OTHER-EXPENSES> 72,766
<LOSS-PROVISION> (3,201)
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 56,458
<INCOME-TAX> 0
<INCOME-CONTINUING> 56,458
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 56,458
<EPS-PRIMARY> 2.20
<EPS-DILUTED> 0
</TABLE>
