<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
FORM 10-Q
(MARK ONE)
[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 0-14505
---------
Enstar Income Program II-2, L.P.
- --------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Georgia 58-1628872
- ------------------------------- ----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
10900 Wilshire Boulevard - 15th Floor
Los Angeles, California 90024
- ---------------------------------------- ----------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (310) 824-9990
------------------
- --------------------------------------------------------------------------------
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
----- -----
<PAGE> 2
PART I - FINANCIAL INFORMATION
ENSTAR INCOME PROGRAM II-2, L.P.
CONDENSED BALANCE SHEETS
====================================
<TABLE>
<CAPTION>
December 31, June 30,
1997* 1998
----------- -----------
(Unaudited)
<S> <C> <C>
ASSETS:
Cash and cash equivalents $ 3,078,800 $ 3,592,500
Accounts receivable, less allowance of $12,500 and
$5,200 for possible losses 54,300 67,200
Prepaid expenses and other assets 190,500 334,900
Property, plant and equipment, less accumulated
depreciation and amortization of $7,567,400 and $7,264,300 3,040,000 2,847,600
Franchise cost, net of accumulated
amortization of $1,174,800 and $1,174,200 271,700 220,000
Deferred charges, net 14,100 10,200
----------- -----------
$ 6,649,400 $ 7,072,400
=========== ===========
LIABILITIES AND PARTNERSHIP CAPITAL
-----------------------------------
LIABILITIES:
Accounts payable $ 466,000 $ 288,600
Due to affiliates 228,000 228,200
----------- -----------
TOTAL LIABILITIES 694,000 516,800
----------- -----------
COMMITMENTS AND CONTINGENCIES
PARTNERSHIP CAPITAL (DEFICIT):
General partners (14,200) (8,200)
Limited partners 5,969,600 6,563,800
----------- -----------
TOTAL PARTNERSHIP CAPITAL 5,955,400 6,555,600
----------- -----------
$ 6,649,400 $ 7,072,400
=========== ===========
</TABLE>
*As presented in the audited financial statements.
See accompanying notes to condensed financial statements.
-2-
<PAGE> 3
ENSTAR INCOME PROGRAM II-2, L.P.
CONDENSED STATEMENTS OF OPERATIONS
====================================
<TABLE>
<CAPTION>
Unaudited
-------------------------------
Three months ended
June 30,
-------------------------------
1997 1998
----------- -----------
<S> <C> <C>
REVENUES $ 945,800 $ 1,008,500
----------- -----------
OPERATING EXPENSES:
Service costs 283,800 315,100
General and administrative expenses 105,000 109,900
General Partner management fees
and reimbursed expenses 135,500 141,600
Depreciation and amortization 173,800 183,900
----------- -----------
698,100 750,500
----------- -----------
OPERATING INCOME 247,700 258,000
----------- -----------
OTHER INCOME (EXPENSE):
Interest income 30,800 42,800
Interest expense (4,100) (3,200)
Gain on sale of cable assets -- 6,400
----------- -----------
26,700 46,000
----------- -----------
NET INCOME $ 274,400 $ 304,000
=========== ===========
Net income allocated to General Partners $ 2,700 $ 3,000
=========== ===========
Net income allocated to Limited Partners $ 271,700 $ 301,000
=========== ===========
NET INCOME PER UNIT OF LIMITED
PARTNERSHIP INTEREST $ 9.09 $ 10.07
=========== ===========
AVERAGE LIMITED PARTNERSHIP
UNITS OUTSTANDING DURING PERIOD 29,880 29,880
=========== ===========
</TABLE>
See accompanying notes to condensed financial statements.
-3-
<PAGE> 4
ENSTAR INCOME PROGRAM II-2, L.P.
CONDENSED STATEMENTS OF OPERATIONS
====================================
<TABLE>
<CAPTION>
Unaudited
-------------------------------
Six months ended
June 30,
-------------------------------
1997 1998
----------- -----------
<S> <C> <C>
REVENUES $ 1,885,600 $ 2,004,700
----------- -----------
OPERATING EXPENSES:
Service costs 573,100 626,100
General and administrative expenses 180,600 229,900
General Partner management fees
and reimbursed expenses 262,500 280,100
Depreciation and amortization 361,200 349,000
----------- -----------
1,377,400 1,485,100
----------- -----------
OPERATING INCOME 508,200 519,600
----------- -----------
OTHER INCOME (EXPENSE):
Interest income 55,900 80,600
Interest expense (12,200) (6,400)
Gain on sale of cable assets -- 6,400
----------- -----------
43,700 80,600
----------- -----------
NET INCOME $ 551,900 $ 600,200
=========== ===========
Net income allocated to General Partners $ 5,500 $ 6,000
=========== ===========
Net income allocated to Limited Partners $ 546,400 $ 594,200
=========== ===========
NET INCOME PER UNIT OF LIMITED
PARTNERSHIP INTEREST $ 18.29 $ 19.89
=========== ===========
AVERAGE LIMITED PARTNERSHIP
UNITS OUTSTANDING DURING PERIOD 29,880 29,880
=========== ===========
</TABLE>
See accompanying notes to condensed financial statements.
-4-
<PAGE> 5
ENSTAR INCOME PROGRAM II-2, L.P.
STATEMENTS OF CASH FLOWS
====================================
<TABLE>
<CAPTION>
Unaudited
-------------------------------
Six months ended
June 30,
-------------------------------
1997 1998
----------- -----------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 551,900 $ 600,200
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation and amortization 361,200 349,000
Amortization of deferred loan costs 13,900 --
Increase (decrease) from changes in:
Accounts receivable, prepaid expenses and other assets 21,400 (157,300)
Accounts payable and due to affiliates 40,600 (177,200)
----------- -----------
Net cash provided by operating activities 989,000 614,700
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (237,600) (96,100)
Increase in intangible assets (8,400) (4,900)
----------- -----------
Net cash used in investing activities (246,000) (101,000)
----------- -----------
INCREASE IN CASH AND CASH EQUIVALENTS 743,000 513,700
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD 1,968,100 3,078,800
----------- -----------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD $ 2,711,100 $ 3,592,500
=========== ===========
</TABLE>
See accompanying notes to condensed financial statements.
-5-
<PAGE> 6
ENSTAR INCOME PROGRAM II-2, L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS
=======================================
1. INTERIM FINANCIAL STATEMENTS
The accompanying condensed interim financial statements for the three
and six months ended June 30, 1998 and 1997 are unaudited. These condensed
interim financial statements should be read in conjunction with the audited
financial statements and notes thereto included in the Partnership's latest
Annual Report on Form 10-K. In the opinion of management, such statements
reflect all adjustments (consisting only of normal recurring adjustments)
necessary for a fair presentation of the results of such periods. The results of
operations for the three and six months ended June 30, 1998 are not necessarily
indicative of results for the entire year.
2. TRANSACTIONS WITH THE GENERAL PARTNERS AND AFFILIATES
The Partnership has a management and service agreement with a wholly
owned subsidiary of the Corporate General Partner (the "Manager") for a monthly
management fee of 5% of revenues, excluding revenues from the sale of cable
television systems or franchises. Management fee expense approximated $50,400
and $100,200 for the three and six months ended June 30, 1998.
In addition to the monthly management fee described above, the
Partnership reimburses the Manager for direct expenses incurred on behalf of the
Partnership and for the Partnership's allocable share of operational costs
associated with services provided by the Manager. All cable television
properties managed by the Corporate General Partner and its subsidiary are
charged a proportionate share of these expenses. The Corporate General Partner
has contracted with Falcon Holding Group, L.P. ("FHGLP"), an affiliated
partnership, to provide corporate management services for the Partnership.
Corporate office allocations and district office expenses are charged to the
properties served based primarily on the respective percentage of basic
subscribers or homes passed (dwelling units within a system) within the
designated service areas. The total amount charged to the Partnership for these
services approximated $91,200 and $179,900 for the three and six months ended
June 30, 1998. Management fees and reimbursed expenses due the Corporate General
Partner are non-interest bearing.
The Partnership also receives certain system operating management
services from an affiliate of the Corporate General Partner in addition to the
Manager due to the fact that there are no such employees directly employed by
one of the Partnership's cable systems. The Partnership reimburses the affiliate
for its allocable share of the affiliate's operational costs. The total amount
charged to the Partnership for these costs approximated $16,400 and $35,700 for
the three and six months ended June 30, 1998. No management fee is payable to
the affiliate by the Partnership and there is no duplication of reimbursed
expenses and costs paid to the Manager.
-6-
<PAGE> 7
ENSTAR INCOME PROGRAM II-2, L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS
=======================================
2. TRANSACTIONS WITH THE GENERAL PARTNERS AND AFFILIATES (CONTINUED)
Certain programming services have been purchased through an affiliate
of the Partnership. In turn, the affiliate charges the Partnership for these
costs based on an estimate of what the Corporate General Partner could negotiate
for such programming services for the 15 partnerships managed by the Corporate
General Partner as a group. The Partnership recorded programming fee expense of
$218,000 and $433,500 for the three and six months ended June 30, 1998.
Programming fees are included in service costs in the statements of operations.
3. EARNINGS PER UNIT OF LIMITED PARTNERSHIP INTEREST
Earnings and losses per unit of limited partnership interest is based
on the average number of units outstanding during the periods presented. For
this purpose, earnings and losses have been allocated 99% to the Limited
Partners and 1% to the General Partners. The General Partners do not own units
of partnership interest in the Partnership, but rather hold a participation
interest in the income, losses and distributions of the Partnership.
-7-
<PAGE> 8
ENSTAR INCOME PROGRAM II-2, L.P.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
INTRODUCTION
The Cable Television Consumer Protection and Competition Act of 1992
(the "1992 Cable Act") required the Federal Communications Commission ("FCC")
to, among other things, implement extensive regulation of the rates charged by
cable television systems for basic and programming service tiers, installation,
and customer premises equipment leasing. Compliance with those rate regulations
has had a negative impact on the Partnership's revenues and cash flow. The
Telecommunications Act of 1996 (the "1996 Telecom Act") substantially changed
the competitive and regulatory environment for cable television and
telecommunications service providers. Among other changes, the 1996 Telecom Act
provides that the regulation of cable programming service tier ("CPST") rates
will be terminated on March 31, 1999. Because cable service rate increases have
continued to outpace inflation under the FCC's existing regulations, the
Partnership expects Congress and the FCC to explore additional methods of
regulating cable service rate increases, including deferral or repeal of the
March 31, 1999 termination of CPST rate regulation. There can be no assurance as
to what, if any, further action may be taken by the FCC, Congress or any other
regulatory authority or court, or the effect thereof on the Partnership's
business. Accordingly, the Partnership's historical financial results as
described below are not necessarily indicative of future performance.
This Report includes certain forward looking statements regarding,
among other things, future results of operations, regulatory requirements,
competition, capital needs and general business conditions applicable to the
Partnership. Such forward looking statements involve risks and uncertainties
including, without limitation, the uncertainty of legislative and regulatory
changes and the rapid developments in the competitive environment facing cable
television operators such as the Partnership. In addition to the information
provided herein, reference is made to the Partnership's Annual Report on Form
10-K for the year ended December 31, 1997 for additional information regarding
such matters and the effect thereof on the Partnership's business.
RESULTS OF OPERATIONS
The Partnership's revenues increased from $945,800 to $1,008,500, or by
6.6%, and from $1,885,600 to $2,004,700, or by 6.3%, for the three and six
months ended June 30, 1998 as compared to the corresponding periods of 1997. Of
the $62,700 increase in revenues for the three months ended June 30, 1998 as
compared to the corresponding period in 1997, $46,000 was due to increases in
regulated service rates that were implemented by the Partnership in 1997 and
$16,700 was due to increases in other revenue producing items, including charges
for franchise fees that the Partnership is permitted to pass through to its
customers. Of the $119,100 increase in revenues for the six months ended June
30, 1998 as compared to the corresponding period in 1997, $100,800 was due to
increases in regulated service rates that were implemented by the Partnership in
1997 and $23,500 was due to increases in other revenue producing items as
described above. These increases were partially offset by a $5,200 decrease due
to decreases in the number of subscriptions for premium, tier and equipment
rental services. As of June 30, 1998, the Partnership had approximately 9,100
basic subscribers and 1,900 premium service units.
-8-
<PAGE> 9
ENSTAR INCOME PROGRAM II-2, L.P.
RESULTS OF OPERATIONS (CONTINUED)
Service costs increased from $283,800 to $315,100, or by 11.0%, and
from $573,100 to $626,100, or by 9.2%, for the three and six months ended June
30, 1998 as compared to the corresponding periods of 1997. Service costs
represent costs directly attributable to providing cable services to customers.
The increases were primarily due to higher programming fees and decreases in the
capitalization of labor and overhead costs resulting from reductions in rebuild
construction activity in the Jerseyville, Illinois franchise during the 1998
periods. Programming fees increased primarily as a result of higher rates
charged by program suppliers.
General and administrative expenses increased from $105,000 to
$109,900, or by 4.7%, and from $180,600 to $229,900, or by 27.3%, for the three
and six months ended June 30, 1998 as compared to the corresponding periods of
1997. The increase in both periods was partially due to higher professional
fees, including audit expense. Increased marketing costs and bad debt expense
also contributed to the six months' increase.
Management fees and reimbursed expenses increased from $135,500 to
$141,600, or by 4.5%, and from $262,500 to $280,100, or by 6.7%, for the three
and six months ended June 30, 1998 as compared to the corresponding periods of
1997. Management fees increased in direct relation to increased revenues as
described above. Reimbursed expenses increased primarily due to higher allocated
personnel costs resulting from staff additions and due to higher allocated
telephone expense.
Depreciation and amortization expense increased from $173,800 to
$183,900, or by 5.8%, and decreased from $361,200 to $349,000, or by 3.4%, for
the three and six months ended June 30, 1998 as compared to the corresponding
periods of 1997. The three months' increase was due to the addition of plant
assets in the second half of 1997 and the first six months of 1998. The decrease
for the six months was due to a reduction in the remaining life of certain plant
assets that were replaced in the first three months of 1997.
Operating income increased from $247,700 to $258,000, or by 4.2%, and
from $508,200 to $519,600, or by 2.2%, for the three and six months ended June
30, 1998 as compared to the corresponding periods in 1997, principally due to
increases in revenues.
Interest income increased from $30,800 to $42,800, or by 39.0%, and
from $55,900 to $80,600, or by 44.2%, for the three and six months ended June
30, 1998 as compared to the corresponding periods of 1997, primarily due to
higher average cash balances available for investment.
Interest expense decreased from $4,100 to $3,200, or by 22.0%, and from
$12,200 to $6,400, or by 47.5%, for the three and six months ended June 30, 1998
as compared to the corresponding periods in 1997. The Partnership fully
amortized deferred loan costs to interest expense in the first three months of
1997. Such costs were related to the Partnership's note payable, which was
repaid in August 1996.
The Partnership sold equipment during the three months ended June 30,
1998 and, accordingly, recognized a $6,400 gain in connection with the sale.
-9-
<PAGE> 10
ENSTAR INCOME PROGRAM II-2, L.P.
RESULTS OF OPERATIONS (CONTINUED)
Due to the factors described above, the Partnership's net income
increased from $274,400 to $304,000, or by 10.8%, and from $551,900 to $600,200,
or by 8.8%, for the three and six months ended June 30, 1998 as compared to the
corresponding periods in 1997.
Based on its experience in the cable television industry, the
Partnership believes that operating income before depreciation and amortization
(EBITDA) and related measures of cash flow serve as important financial analysis
tools for measuring and comparing cable television companies in several areas,
such as liquidity, operating performance and leverage. EBITDA is not a
measurement determined under generally accepted accounting principles ("GAAP")
and does not represent cash generated from operating activities in accordance
with GAAP. EBITDA should not be considered by the reader as an alternative to
net income as an indicator of financial performance or as an alternative to cash
flows as a measure of liquidity. In addition, the definition of EBITDA may not
be identical to similarly titled measures used by other companies. EBITDA as a
percentage of revenues decreased from 44.6% to 43.8% and from 46.1% to 43.3%
during the three and six months ended June 30, 1998 as compared to the
corresponding periods in 1997. The decreases were primarily due to increases in
programming fees and decreases in capitalization of labor and overhead costs as
described above. EBITDA increased from $421,500 to $441,900, or by 4.8%, during
the three months ended June 30, 1998, and remained relatively unchanged for the
six months ended June 30, 1998 as compared to the corresponding periods in 1997.
LIQUIDITY AND CAPITAL RESOURCES
The Partnership's primary objective, having invested its net offering
proceeds in cable systems, is to distribute to its partners all available cash
flow from operations and proceeds from the sale of cable systems, if any, after
providing for expenses, debt service and capital requirements relating to the
expansion, improvement and upgrade of its cable systems.
At June 30, 1998, the Partnership had no debt outstanding. The
Partnership relies upon the availability of cash generated from operations to
fund its ongoing expenses and capital requirements. The Partnership is required
to rebuild its Jerseyville, Illinois cable system at an estimated total cost of
approximately $260,500 under a provision of its franchise agreement. The
Partnership is also rebuilding portions of its cable systems in surrounding
communities at an estimated additional cost of approximately $1,801,900.
Construction began in the second quarter of 1996 and is expected to be completed
in 1998. Capital expenditures related to the Jerseyville rebuild approximated
$85,000 as of December 31, 1997. Other rebuild costs amounted to $1,776,000 as
of December 31, 1997. Additional construction expenditures of $201,400 are
projected for 1998, including approximately $175,500 for the required rebuild in
Jerseyville. Total rebuild expenditures in the first six months of 1998 were
approximately $39,500. Expenditures of $138,200 are budgeted to upgrade
additional equipment in 1998. Such expenditures approximated $56,600 in the six
months ended June 30, 1998. Additionally, the Partnership is required to upgrade
its cable plant in Malden, Missouri at an estimated cost of approximately
$2,100,000, the start of which is dependent upon obtaining an extension of the
franchise agreement for that system.
-10-
<PAGE> 11
ENSTAR INCOME PROGRAM II-2, L.P.
LIQUIDITY AND CAPITAL RESOURCES (CONTINUED)
The Corporate General Partner believes that cash flow from operations
will be adequate to meet the Partnership's current liquidity requirements,
including the funding for capital expenditures discussed above. However, as a
result of such liquidity requirements, the Corporate General Partner has
concluded that it is not prudent for the Partnership to resume paying
distributions at this time.
Beginning in August 1997, the Partnership elected to self-insure its
cable distribution plant and subscriber connections against property damage as
well as possible business interruptions caused by such damage. The decision to
self-insure was made due to significant increases in the cost of insurance
coverage and decreases in the amount of insurance coverage available.
While the Partnership has made the election to self-insure for these
risks based upon a comparison of historical damage sustained over the past five
years with the cost and amount of insurance currently available, there can be no
assurance that future self-insured losses will not exceed prior costs of
maintaining insurance for these risks. Approximately 71% of the Partnership's
subscribers are served by its system in Hillsboro, Illinois and neighboring
communities. Significant damage to the system due to seasonal weather conditions
or other events could have a material adverse effect on the Partnership's
liquidity and cash flows. The Partnership continues to purchase insurance
coverage in amounts its management views as appropriate for all other property,
liability, automobile, workers' compensation and other types of insurable risks.
The "Year 2000" issue refers to certain contingencies that could result
from computer programs being written using two digits rather than four to define
the year. Many existing computer systems, including certain of the Partnership's
computer systems, process transactions based on two digits for the year of the
transaction (for example, "98" for 1998). These computer systems may not operate
effectively when the last two digits become "00," as will occur on January 1,
2000.
The Corporate General Partner has commenced an assessment of the
Partnership's Year 2000 business risks and its exposure to computer systems, to
operating equipment which is date sensitive and to the interface systems of its
vendors and service providers. Based on a preliminary study, the Corporate
General Partner has concluded that certain of the Partnership's information
systems were not Year 2000 compliant and has elected to replace such software
and hardware with Year 2000 compliant applications and equipment, although the
decision to replace major portions of such software and hardware had previously
been made without regard to the Year 2000 issue. The Corporate General Partner
expects to install substantially all of the new systems in 1998, with the
remaining systems to be installed in the first half of 1999. The total
anticipated cost, including replacement software and hardware, will be borne by
FHGLP.
In addition to evaluating internal systems, the Partnership is
currently assessing its exposure to risks associated with its operating and
revenue generating equipment and has also initiated communications with
significant third party vendors and service suppliers to determine the extent to
which the Partnership's interface systems are vulnerable should those third
parties fail to solve their own Year 2000 problems on a timely basis. The
Partnership currently expects that the cost to replace non-compliant equipment
will be determined during the third quarter of 1998. Such costs will be borne by
the Partnership. There can be no assurance that the systems of other companies
on which the Partnership's systems rely will be timely
-11-
<PAGE> 12
ENSTAR INCOME PROGRAM II-2, L.P.
LIQUIDITY AND CAPITAL RESOURCES (CONTINUED)
converted and that the failure to do so would not have an adverse impact on the
Partnership's business. The Partnership continues to closely monitor
developments with its vendors and service suppliers.
SIX MONTHS ENDED JUNE 30, 1998 AND 1997
Operating activities used $374,300 more cash in the six months ended
June 30, 1998 as compared with the corresponding period in 1997. The Partnership
used $217,800 more cash for the payment of amounts owed to affiliates and
third-party creditors due to differences in the timing of payments. Changes in
accounts receivable and prepaid expenses used $178,700 more cash in the first
six months of 1998 due to differences in the timing of receivable collections
and in the payment of prepaid expenses.
Investing activities used $145,000 less cash in the six months ended
June 30, 1998 than in the corresponding six months of 1997, due to a $141,500
decrease in expenditures for tangible assets, and a $3,600 decrease in spending
for intangible assets.
INFLATION
Certain of the Partnership's expenses, such as those for wages and
benefits, equipment repair and replacement, and billing and marketing generally
increase with inflation. However, the Partnership does not believe that its
financial results have been, or will be, adversely affected by inflation in a
material way, provided that Partnership is able to increase its service rates
periodically, of which there can be no assurance.
-12-
<PAGE> 13
ENSTAR INCOME PROGRAM II-2, L.P.
PART II. OTHER INFORMATION
ITEMS 1-5. Not applicable.
ITEM 6. Exhibits and Reports on Form 8-K
(a) None
(b) The Registrant filed a Form 8-K dated April 30, 1998,
in which it reported under Item 5 that a financial
printer erroneously used the filing codes for Enstar
Income Program II-2, L.P. and mistakenly filed on
behalf of the Partnership a Current Report on Form 8-K
for another partnership.
<PAGE> 14
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.
ENSTAR INCOME PROGRAM II-2, L.P.
a GEORGIA LIMITED PARTNERSHIP
-----------------------------
(Registrant)
By: ENSTAR COMMUNICATIONS CORPORATION
General Partner
Date: August 13, 1998 By: /s/ Michael K. Menerey
-------------------------
Michael K. Menerey,
Executive Vice President,
Chief Financial Officer and
Secretary
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET AT JUNE 30, 1998, AND THE STATEMENTS OF OPERATIONS FOR THE SIX MONTHS
ENDED JUNE 30, 1998 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> JUN-30-1998
<CASH> 3,592,500
<SECURITIES> 0
<RECEIVABLES> 72,400
<ALLOWANCES> 5,200
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 10,111,900
<DEPRECIATION> 7,264,300
<TOTAL-ASSETS> 7,042,400
<CURRENT-LIABILITIES> 516,800
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 7,072,400
<SALES> 0
<TOTAL-REVENUES> 2,004,700
<CGS> 0
<TOTAL-COSTS> 1,485,100
<OTHER-EXPENSES> (87,000)
<LOSS-PROVISION> 32,300
<INTEREST-EXPENSE> 6,400
<INCOME-PRETAX> 600,200
<INCOME-TAX> 0
<INCOME-CONTINUING> 600,200
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 600,200
<EPS-PRIMARY> 19.89
<EPS-DILUTED> 0
</TABLE>
