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 June 30, 1995 Commission File No. 2-92914
COLUMBIA LEASE INCOME FUND B L.P.
(Exact name of registrant as specified in its charter)
Delaware 13-3239271
(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 13
(Page 2)
<TABLE>
COLUMBIA LEASE INCOME FUND B L.P.
(A Delaware Limited Partnership)
<CAPTION>
INDEX Page No.
<S> <C>
Part I. FINANCIAL INFORMATION
Financial Statements
Balance Sheets as of June 30, 1995
and December 31, 1994 3
Statements of Operations For the
Quarters Ended June 30, 1995 and 1994 and the
Six Months Ended June 30, 1995 and 1994 4
Statements of Cash Flows For the Six
Months Ended June 30, 1995 and 1994 5
Notes to Financial Statements 6 - 7
Management's Discussion and Analysis of
Financial Condition and Results of Operations 8 - 11
Part II. OTHER INFORMATION
Items 1 - 6 12
Signature 13
</TABLE>
(Page 2)
<TABLE>
PART I. FINANCIAL INFORMATION
COLUMBIA LEASE INCOME FUND B L.P.
(A Delaware Limited Partnership)
Balance Sheets
Assets (Unaudited) (Audited)
6/30/95 12/31/94
<S> <C> <C>
Investment property, at cost (note 3):
Computer equipment $ 502,411 $ 973,398
Less accumulated depreciation 482,436 891,773
---------------------------
Investment property, net 19,975 81,625
Cash and cash equivalents 166,891 93,575
Marketable securities (note 2) 8,050 -
Net investment in sales - type and direct
financing leases 71,907 156,277
Rents receivable, net (note 2) 2,119 3,105
Accounts receivable - affiliates 5,009 7,884
Sales receivable, net (note 2) - 8,000
---------------------------
Total assets $ 273,951 $ 350,466
===========================
Liabilities and Partners' Equity
Liabilities:
Accounts payable and accrued expenses -
affiliates (note 4) $ 29,478 $ 40,820
Accounts payable and accrued expenses 80,077 102,580
Distributions payable (note 5) 96,636 96,636
---------------------------
Total liabilities 206,191 240,036
---------------------------
Partners' equity:
General Partner:
Capital contribution 1,000 1,000
Cumulative net income 120,363 113,293
Cumulative cash distributions (507,406) (498,202)
Reallocation of capital accounts 386,043 383,909
---------------------------
- -
---------------------------
Limited Partners (23,316 units):
Capital contribution, net of
offering costs 10,025,879 10,025,879
Cumulative net income 2,286,900 2,152,566
Cumulative cash distributions (11,858,976) (11,684,106)
Reallocation of capital accounts (386,043) (383,909)
---------------------------
67,760 110,430
---------------------------
Total partners' equity 67,760 110,430
---------------------------
Total liabilities and partners' equity $ 273,951 $ 350,466
===========================
</TABLE>
See accompanying notes to financial statements.
(Page 3)
<TABLE>
COLUMBIA LEASE INCOME FUND B L.P.
(A Delaware Limited Partnership)
Statements of Operations
(Unaudited)
Quarters Ended Six Months Ended
June 30, June 30,
---------------------- --------------------
1995 1994 1995 1994
---------------------- --------------------
<S> <C> <C> <C> <C>
Revenue:
Rental income on
operating leases $ 44,741 $ 40,572 $ 71,446 $ 95,073
Other income 18,571 - 18,571 -
Earned income on sales-type
and direct financing leases 2,614 9,073 10,368 19,922
Recovery of unsecured
pre-petition claim (note 2) 8,050 - 43,309 -
Interest income 1,549 644 2,487 1,896
Net gain on sale
of equipment 17,160 11,255 89,019 59,986
--------------------- --------------------
Total revenue 92,685 61,544 235,200 176,877
--------------------- --------------------
Costs and expenses:
Depreciation 13,564 45,830 46,519 93,199
Related party expenses
(note 4):
Management fees 1,298 9,314 7,398 16,444
General and administrative 17,808 12,318 32,138 25,011
Provision for
doubtful accounts 516 7,543 7,741 7,543
--------------------- ---------------------
Total costs
and expenses 33,186 75,005 93,796 142,197
--------------------- ---------------------
Net income (loss) $ 59,499 $(13,461) $141,404 $ 34,680
===================== =====================
Net income (loss) per Limited
Partnership Unit $ 2.42 $ (0.55) $ 5.76 $ 1.41
===================== =====================
</TABLE>
See accompanying notes to financial statements.
(Page 5)
<TABLE>
COLUMBIA LEASE INCOME FUND B L.P.
(A Delaware Limited Partnership)
Statements of Cash Flows
For the Six Months Ended June 30, 1995 and 1994
(Unaudited)
1995 1994
<S> <C> <C>
Cash flows from operating activities:
Net income $ 141,404 $ 34,680
---------------------------
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation 46,519 93,199
Provision for doubtful accounts 7,741 7,543
Net gain on sale of equipment (89,019) (59,986)
Net decrease in current assets 80,440 108,194
Net (decrease) increase in
current liabilities (33,845) 14,101
---------------------------
Total adjustments 11,836 163,051
---------------------------
Net cash provided by operating activities 153,240 197,731
---------------------------
Cash flows from investing activities:
Purchase of investment property - (5,444)
Proceeds from sales of investment property 104,150 74,862
---------------------------
Cash provided by investing activities 104,150 69,418
---------------------------
Cash flows from financing activities:
Cash distributions to partners (184,074) (276,111)
---------------------------
Cash used in financing activities (184,074) (276,111)
---------------------------
Net increase (decrease) in cash and cash
equivalents 73,316 (8,962)
Cash and cash equivalents at beginning of period 93,575 112,918
---------------------------
Cash and cash equivalents at end of period $ 166,891 $ 103,956
===========================
Supplemental cash flow information:
Interest paid during the period $ - $ -
===========================
</TABLE>
See accompanying notes to financial statements.
(Page 6)
COLUMBIA LEASE INCOME FUND B L.P.
(A Delaware Limited Partnership)
Notes to Financial Statements
(Unaudited)
(1) Organization
The foregoing financial statements of Columbia
Lease Income Fund B 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, 1994.
During the second quarter of 1995, the General
Partner announced its intentions of winding down
the operations of the Partnership. It is
anticipated that substantially all of the assets
will be liquidated and the proceeds will be used
to settle all outstanding liabilities and make a
final distribution by the end of 1995. The
Partnership will not be terminated until the
unsecured pre-petition claim against CIS
Corporation has been settled and the remaining
proceeds have been distributed to the Partners
(see notes 6 & 7 for further discussion).
(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, 1995 and December 31,
1994, the allowance for doubtful accounts
included in rents receivable was $1,132 and
$1,391, respectively, and $8,000 and $0 included
in sales receivable, respectively.
Marketable Securities
The marketable securities consist of common stock
in Continental Information Systems Corporation
received by the Partnership in March 1995 in the
first distribution made by the Trustee of the
Liquidating Estate of CIS Corporation, et al with
respect to the outstanding unsecured pre-petition
claim. During the second quarter of 1995, the
stock began trading, thereby providing an
objective valuation measure for establishing the
cost basis which approximates fair market value
at the balance sheet date.
Reclassifications
Certain prior year financial statement items have
been reclassified to conform with the current
year's financial statement presentation.
(3)
Investment Property
At June 30, 1995, the Partnership owned computer
equipment with a cost basis of $440,869, subject
to existing leases and equipment with a cost
basis of $61,542 in inventory awaiting re-lease
or sale. All purchases of computer equipment are
subject to a 2.5% acquisition fee paid to the
General Partner.
(Page 7)
(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, 1995 and 1994 are as
follows:
<TABLE>
<CAPTION>
1995 1994
<S> <C> <C>
Equipment acquisition fees $ - $ 9,967
Management fees 7,398 16,444
Reimbursable expenses paid 36,274 23,130
---------------------
$ 43,672 $ 49,541
=====================
</TABLE>
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
collected, paid quarterly. 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, 1995,
declarations of Distributable Cash were as
follows:
<TABLE>
<CAPTION>
Limited Partners
<S> <C> <C> <C> <C>
General
Date Paid Distribution Partner
Quarter Ended or Payable Per $500 Unit Totals Totals
March 31, 1995 May 15, 1995 $ 3.75 $ 87,435 $4,602
June 30, 1995 August 15, 1995 $ 3.75 $ 87,435 $4,602
</TABLE>
(Page 8)
(6) Bankruptcy of Continental Information Systems Corporation
On January 13, 1989 ("Petition Date"),
Continental Information Systems Corporation, CMI
Holding Co., CMI Corporation, CIS Corporation,
and certain of their affiliates (collectively,
the "Debtors") voluntarily petitioned for relief
under Chapter 11 of the United States Bankruptcy
Code ("Chapter 11"), and thereafter continued in
the management and operation of their businesses
and property as Debtors in possession until
October 25, 1989, when the United States
Bankruptcy Court (the "Court") confirmed the
appointment of James P. Hassett as Chapter 11
trustee (the "Trustee") of the Debtors. TLP
Leasing Programs, Inc. ("TLP"), the parent
company of TLP Columbia Management Corporation
("TCMC"), is a wholly-owned subsidiary of CMI
Holding Co., but did not file under Chapter 11.
TCMC will continue to manage and provide services
for the Partnership in accordance with the
Partnership Agreement, as they have in the past.
CMI Holding Co. has become a wholly-owned
subsidiary of CIS Corporation pursuant to a Court
ordered settlement entered into among various
Prudential Insurance entities and CIS Corporation
which settled certain claims Prudential had
against CIS Corporation. The Court approved the
settlement on July 20, 1993.
On November 29, 1994, the Court confirmed the
Trustee's proposed Joint Plan of Reorganization
dated October 4, 1994, and the Debtors emerged
from Chapter 11 bankruptcy protection on December
21, 1994.
In March 1995, the Partnership received the first
distribution from the Trustee (now trustee of the
Liquidating Estate of CIS Corporation, et al)
with respect to the unsecured pre-petition claim
against CIS Corporation and CMI Corporation of
$76,023, which had previously been written off in
1990. The distribution consisted of cash
proceeds of $35,259 and 3,220 shares of common
stock in Continental Information Systems
Corporation. During the second quarter of 1995,
the stock began trading, thereby providing an
objective valuation measure for establishing the
cost basis which approximates fair market value
at June 30, 1995. In 1990, when the claim was
originally made, the partnership was unrelated to
the Liquidating Estate.
(7) Subsequent Events
On July 20, 1995, the Partnership received the
second distribution from the Trustee of the
Liquidating Estate of CIS Corporation, et al,
with respect to the unsecured pre-petition claim.
The distribution consisted of cash proceeds of
$3,537 and 456 shares of common stock in
Continental Information Systems Corporation with
a carrying value of $1,140. The cash and stock
will be reflected in the financial statements for
the third quarter of 1995. Following the
Trustee's second distribution, the Partnership
has a remaining unsecured pre-petition claim of
$21,457 as of July 20, 1995. The General Partner
anticipates that the Liquidating Estate will make
future distributions on the remaining outstanding
claim balance, although it is not possible at
this time to determine when these distributions
will be made.
(Page 9)
COLUMBIA LEASE INCOME FUND B 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 month periods
ended June 30, 1995, compared to the same period
in 1994.
The Partnership realized net income of $59,499
and a net loss of $13,461 for the three month
periods ended June 30, 1995, and 1994,
respectively. Rental income on operating leases
increased $4,169 or 10% between the three month
periods. The slight increase in rental income is
due to favorable results of equipment lease
extensions and remarketings in the current
quarter. Other income in the current period is
the result of the reduction of overstated
liabilities recorded in prior periods. Earned
income on existing sales-type and direct
financing leases will continue to decline over
the lease terms as more of each minimum lease
payment, as calculated using the rate implicit in
the lease, is allocated to the recovery of the
fair market value of the equipment at the
inception of the lease. The Partnership
currently has one sale-type lease and two direct
financing leases, all having lease terms
scheduled to expire in 1995. The recovery of
unsecured pre-petition claim was the result of
the establishment of the carrying value of the
stock in Continental Information Systems
Corporation received in the March 1995
distribution from the Trustee of the Liquidating
Estate of CIS Corporation, et al. The
receivables associated with the stock settlement
had been written off in 1990; accordingly, the
Partnership was able to show a recovery on those
receivables as of June 30, 1995 at which time an
objective stock value could be determined due to
the stock's trading activities. The net gain on
sale of equipment can be attributed to sales of
equipment carrying low net book values.
Total costs and expenses decreased $41,819 or 56%
between the three month periods. The decrease in
costs and expenses is primarily the result of
lower depreciation expense. The decrease in
depreciation expense is due to a large portion of
the equipment portfolio becoming fully
depreciated and a reduction in the overall
equipment portfolio. Management fees have
decreased significantly due to the current
quarter refund from the General Partner of
management fees charged on receivables that have
been deemed uncollectible. General and
administrative expenses were lower in 1994 due to
an overaccrual in prior periods which was
reversed in the period ending June 30, 1994. The
Partnership's provision for doubtful accounts
decreased from June 30, 1994 due to fewer
delinquent rent receivables outstanding.
(Page 10)
The Partnership realized net income of $141,404
and $34,680 for the six month periods ended June
30, 1995 and 1994, respectively. Rental income
on operating lease decreased $23,627 or 25%
between the six months period. The decrease in
rental income on operating leases overall is
primarily due to lower rental rates obtained on
equipment lease extensions and remarketings
resulting after the initial lease term expires
and due to a decrease in the overall size of the
equipment lease portfolio. As discussed above,
other income is due to a reduction of overstated
liabilities recorded in prior periods. Earned
income on the existing sales-type and direct
financing leases will continue to decline over
the lease terms as more of each minimum lease
payment, as calculated using the rate implicit in
the lease, is allocated to the recovery of the
fair market value of the equipment at the
inception of the lease. The Partnership
currently has one sale-type lease and two direct
financing leases, all having lease terms
scheduled to expire in 1995. As mentioned above,
the recovery of unsecured pre-petition claim was
the result of the receipt of a cash recovery of
$35,259 and the establishment of the carrying
value of the stock in Continental Information
Systems Corporation received in the March 1995
distribution from the Trustee of the Liquidating
Estate of CIS Corporation, et al. The
receivables associated with the cash and stock
settlement had been written off in 1990;
accordingly, the Partnership was able to show a
recovery on those receivables as of June 30, 1995
at which time an objective stock value could be
determined due to the stock's trading activities.
The increase in net gain on sale of equipment is
attributed to a number of sales in 1995 of
equipment carrying low net book values.
Total costs and expenses decreased $48,401 or 34%
between the six month periods. The decrease in
costs and expenses is primarily the result of
lower depreciation expense. As discussed in the
quarterly analysis above, the decrease in
depreciation is 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 and the current
quarter refund from the General Partner of
management fees charged on receivables that have
been deemed uncollectible. As discussed above,
general and administrative expenses were lower in
1994 due to an overaccrual in prior periods which
was reversed in the period ending June 30, 1994.
The Partnership increased its provision for
doubtful by $7,741 in the first six months of
1995 to reserve for uncollectible accounts.
Liquidity and Capital Resources.
For the six months ended June 30, 1994, rental
revenue generated from operating leases and sales
proceeds from equipment sales were 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. The first factor
is the rate obtained when the original leases
expire and are remarketed at a lower rate.
Typically, the remarketed rates are lower due to
the decrease in useful life of the equipment.
Secondly, 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 and will cause
certain leases to terminate upon expiration.
(Page 11)
During the second quarter of 1995, the General
Partner announced its intentions of winding down
the operations of the Partnership. It is
anticipated that substantially all of the assets
will be liquidated and the proceeds will be used
to settle all outstanding liabilities and to make
a final distribution by the end of 1995. The
Partnership will not be terminated until the
unsecured pre-petition claim against CIS
Corporation has been settled and the remaining
proceeds have been distributed to the Partners.
For the quarter ended June 30, 1995, the
Partnership's investing activities resulted in
equipment sales with a depreciated cost basis of
$59,347, generating $104,150 in proceeds.
Associated with the equipment sale were $44,216
of loss charge offs against the reserve,
initially set up in prior periods for estimated
losses on the ultimate disposition of equipment.
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 and
has announced its intentions of winding down the
Partnership by the end of 1995.
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 June 30, 1995, the
Partnership declared a cash distribution of
$92,037, of which $4,602 was allocated to the
General Partner and $87,435 was allocated to the
Limited Partners. The distribution is payable on
August 15, 1995. The Partnership expects
distributions to be more volatile as its
operations are winding down.
The effects of inflation have not been
significant to the Partnership and are not
expected to have a material impact in the future
periods.
(Page 12)
PART II. OTHER INFORMATION
COLUMBIA LEASE INCOME FUND B 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 13)
SIGNATURE
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.
COLUMBIA LEASE INCOME FUND B L.P.
(Registrant)
By: TLP Columbia Management Corporation,
its General Partner
Date: August 11, 1995
By: Arthur P. Beecher,
President
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000751684
<NAME> COLUMBIA B EX.27 6/30/95
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<CASH> 166,891
<SECURITIES> 8,050
<RECEIVABLES> 88,167
<ALLOWANCES> 9,132
<INVENTORY> 0
<CURRENT-ASSETS> 253,976
<PP&E> 502,411
<DEPRECIATION> 482,436
<TOTAL-ASSETS> 273,951
<CURRENT-LIABILITIES> 206,191
<BONDS> 0
<COMMON> 10,026,879
0
0
<OTHER-SE> (9,959,119)
<TOTAL-LIABILITY-AND-EQUITY> 273,951
<SALES> 81,814
<TOTAL-REVENUES> 235,200
<CGS> 0
<TOTAL-COSTS> 7,398
<OTHER-EXPENSES> 78,657
<LOSS-PROVISION> 7,741
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 141,404
<INCOME-TAX> 0
<INCOME-CONTINUING> 141,404
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 141,404
<EPS-PRIMARY> 5.76
<EPS-DILUTED> 0
</TABLE>
