SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarter ended March 31, 1996 Commission File Number 2-95219
INDIAN RIVER CITRUS INVESTORS LIMITED PARTNERSHIP
(Exact name of small business issuer as specified in its charter)
Massachusetts 04-2859087
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization
One International Place, Boston, MA 02110
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (617) 330-8600
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
PART I - FINANCIAL INFORMATION
INDIAN RIVER CITRUS INVESTORS LIMITED PARTNERSHIP (DEBTOR-IN-POSSESSION)
STATEMENT OF OPERATIONS
(UNAUDITED) (NOTE 1)
<TABLE>
THREE MONTHS ENDED
MARCH 31,
1996 1995
-------- ----
<S> <C> <C>
Fruit Sales $ 707,598 $ 714,549
Less - Harvesting expenses 155,541 226,070
---------- ----------
Net Fruit Sales 552,057 488,479
Cost of Fruit Sales 257,840 398,460
---------- ----------
Operating Margin 294,217 90,019
Other Revenues:
Interest income 28,919 22,396
Other Expenses:
Interest expense 697,113 644,657
Grove management fees 51,557 51,483
Partnership management fees 84,000 75,000
Real estate taxes 16,100 14,700
Amortization 4,692 11,416
Building depreciation - 2,368
General Administrative 53,291 18,105
---------- ----------
906,753 817,729
---------- ----------
Net Loss $ (583,617) $ (705,314)
========== ==========
Net Loss allocated to General Partner $ (58,362) $ (70,531)
========== ==========
Net Loss allocated to Limited Partners $ (525,255) $ (634,783)
========== ==========
Net Loss per Unit of Limited
Partnership Interest $ (33.89) $ (40.95)
========== ==========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
INDIAN RIVER CITRUS INVESTORS LIMITED PARTNERSHIP (DEBTOR-IN-POSSESSION)
BALANCE SHEETS
ASSETS
(NOTE 1)
<TABLE>
March 31, December 31,
1996 1995
(Unaudited) (Audited)
<S> <C> <C>
Current Assets:
Cash and cash equivalents......................................... $ 2,977,366 $ 2,676,875
Accounts receivable............................................... 365,383 329,413
Inventory......................................................... 1,868,608 1,792,035
Other assets...................................................... 44,006 64,660
----------- -----------
........... $ 5,255,363 $ 4,862,983
Property, net......................................................... 18,234,094 18,401,799
Deferred financing costs............................................. - 4,692
----------- -----------
...... $24,489,457 $23,269,474
=========== ===========
LIABILITIES AND PARTNERS' DEFICIT
Current Liabilities:
Notes payable .................................................... $22,869,735 $22,869,735
Accrued interest.................................................. 1,315,528 767,970
Other liabilities................................................. 439,552 183,510
----------- -----------
24,624,815 23,821,215
Partners' Deficit:
Limited Partners, $1,000 stated value per
Unit; 15,500 Units authorized, issued
and outstanding................................................ 128,783 654,038
General Partner................................................... (1,264,141) (1,205,779)
----------- -----------
(1,135,358) (551,741)
----------- -----------
$23,489,457 $23,269,474
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
INDIAN RIVER CITRUS INVESTORS LIMITED PARTNERSHIP (DEBTOR-IN-POSSESSION)
STATEMENTS OF CASH FLOWS
(UNAUDITED) (NOTE 1)
<TABLE>
THREE MONTHS ENDED
MARCH 31,
-------------
1996 1995
-------- ------
<S> <C> <C>
Cash Flows From Operating Activities:
Cash received from customers...................................... $ 673,758 $ 526,535
Cash paid to suppliers............................................ (252,630) (521,625)
Interest received................................................. 28,919 22,392
Interest paid..................................................... (149,556) (1,300,277)
----------- -----------
Net cash provided by (used in)
operating activities......................................... 300,491 (1,272,975)
----------- -----------
Cash Flows From Investing Activities:
Capital expenditures.............................................. - (11,653)
----------- -----------
Net cash used in investing activities............................. - (11,653)
----------- -----------
Net Increase (Decrease) in Cash and Cash
Equivalents....................................................... 300,491 (1,284,628)
----------- -----------
Cash and Cash Equivalents at Beginning
of Period......................................................... 2,676,875 3,124,628
----------- -----------
Cash and Cash Equivalents at End of Period............................ $ 2,977,366 $ 1,840,000
=========== ===========
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
INDIAN RIVER CITRUS INVESTORS LIMITED PARTNERSHIP (DEBTOR-IN-POSSESSION)
STATEMENTS OF CASH FLOWS
(CONTINUED)
(UNAUDITED) (NOTE 1)
<TABLE>
Reconciliation of net loss to net cash provided by operating activities:
THREE MONTHS ENDED
MARCH 31,
---------------
1996 1995
-------- ------
<S> <C> <C>
Net (Loss) Income $ (583,617) $ (705,314)
Adjustments to Reconcile
Net Loss to Net Cash Provided
(Used) By Operating Activities:
Depreciation and amortization................................ 4,692 13,784
Decrease (Increase) in:
Accounts Receivable..................................... (35,970) (181,946)
Inventory............................................... (76,573) (193,665)
Other Assets............................................ 20,654 5,253
Increase (Decrease) in:
Accrued Interest........................................ 547,558 (655,620)
Other Liabilities....................................... 256,042 277,887
Depreciation capitalized to inventory........................ 167,705 166,646
----------- -----------
Net Cash Provided by Operating Activities............................. $ 300,491 $(1,272,975)
=========== ===========
Disclosure of accounting policy:
For purposes of the statement of cash flows, the partnership considers all
highly liquid debt instruments purchased with a maturity of three months or less
to be cash equivalents.
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
INDIAN RIVER CITRUS INVESTORS LIMITED PARTNERSHIP (DEBTOR-IN-POSSESSION)
STATEMENT OF CHANGES IN PARTNERS' CAPITAL (DEFICIT)
FOR THE THREE MONTHS ENDED MARCH 31, 1996 AND 1995
(UNAUDITED) (NOTE 1)
<TABLE>
Limited Partners General
Units Capital Partner Total
<S> <C> <C> <C> <C>
Balance, December 31, 1995 15,500 $ 654,038 $(1,205,779) $ (551,741)
Net Loss (525,255) (58,362) (583,617)
---------- ---------- ----------- ----------
Balance, March 31, 1996 15,500 128,783 $(1,264,141) (1,135,358)
========== ========== =========== ==========
Balance, December 31, 1994 15,500 $2,256,415 $ (1,027,737) $1,228,678
Net Loss (634,783) (70,531) (705,314)
---------- ---------- ----------- ----------
Balance, March 31, 1995 15,500 $1,621,632 $ (1,098,268) $ 523,364
========== ========== ============ ==========
</TABLE>
<PAGE>
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION
This Item should be read in conjunction with the financial statements
and other items contained elsewhere in the report.
Liquidity and Capital Resources
The Registrant's only business is owning and operating a commercial
citrus grove consisting of approximately 3,150 acres of land and
related improvements and equipment located near Stuart, Martin County,
Florida (the "Grove"). The two mortgages encumbering the Grove were
scheduled to mature on January 31, 1996. Due to the unpredictable
nature of fruit prices which are affected by many factors outside the
control of the Registrant such as weather conditions and supply and
demand, over the past eight years the Registrant's net cash flow has
fluctuated from a low of $509,000 to a high of $4,500,000. During the
past five years, including returns anticipated from the 1995 harvest,
the Grove has generated average cash flow of under $1,500,000 which is
insufficient to service total debt service at maturity. As a result,
starting in November 1995, the Partnership entered into discussions
with the first mortgage holder, NationsBank of Florida ("Nations") and
the second mortgage holder, Caulkins Citrus Company ("Caulkins"), in an
attempt to renegotiate the debt. At December 31, 1995, the total debt
encumbering the Grove was approximately $22.9 million. Nations granted
the Partnership a four month extension on the maturity to enable the
Partnership to engage in discussions with Caulkins. After extensive
discussions, Caulkins, without notice, terminated negotiations in
February 1996 by declaring a default, commencing foreclosure
proceedings and obtaining a court order to appoint a receiver to
collect revenues and take over control of the Grove.
On March 4, 1996, as a result of the pending foreclosure proceeding
instituted by the holder of the second mortgage note on the Grove, the
Registrant filed for protection under Chapter 11 of the United States
Bankruptcy Act in the Federal District Court for the State of Florida,
Southern District (Case No. 96-30843-BKC- SHF). If the Registrant is
not permitted to reorganize under the Bankruptcy Act or cannot reach an
agreement with the existing lenders, the Registrant could lose the
Grove in a foreclosure proceeding. At this time, it appears that
investors will not receive a return of a substantial portion of their
original investment in the Registrant.
The level of liquidity based on cash and cash equivalents experienced a
$300,491 increase at March 31, 1996 as compared to December 31, 1995.
Increases in the Partnership's cash from quarter to quarter are
primarily related to the difference in timing of the harvesting of the
crop.
The Partnership invests its working capital reserves in a money market
account or repurchase agreements secured by United States Treasury
obligations.
RESULTS OF OPERATIONS
Operating results improved $121,697 for the three months ended March
31, 1996 as compared to 1995 due to an increase in the operating
margin on fruit sales of $204,198 and an increase in interest income
of $6,523 due to increased cash and cash equivalents which was
partially offset by an increase in expenses of $89,024.
The operating margin on fruit sales increased by $204,198 for the three
months ended March 31, 1996 as compared to 1995 due to an increase in
net fruit sales of $63,578 and a decrease in cost of fruit of $140,620.
The increase in net fruit sales and the decrease in the cost of fruit
sales is primarily attributable to (i) a reduction in the number of
boxes harvested during the three months ended March 31, 1996 (81,700)
as compared to 1995 (120,000), (ii) a slight increase in the
pounds-solid per box ad the price received per pound-solid and (iii) a
reduction in the cost of fruit sales per box from $3.26 in 1995 to
$3.16 in 1996. The harvesting expense per box cost remained constant
for the three months ended March 31, 1996 as compared to 1995 at
approximately $1.90 per box.
The increase in other expenses of $89,024 was primarily attributable to
increases in interest expense of $52,456, partnership management fees
of $9,000 and general and administrative expenses of $35,186. Interest
expense increased as result of an increase in the principal of the
Caulkins loan.
<PAGE>
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
No Report on Form 8-K was required to be filed during the period.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.
INDIAN RIVER CITRUS INVESTORS
LIMITED PARTNERSHIP
(Partnership)
By: Winthrop Agricultural Management, II, Inc.
General Partners
By: /s/ Michael L. Ashner
Michael L. Ashner
Chief Executive Officer
By: /s/ Edward V. Williams
Edward V. Williams
Chief Financial Officer
DATED: May 15, 1996
<PAGE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information
extracted from unaudited financial statements for the
three month period ending March 31, 1996 and is
qualified in its entirety by reference to such financial
statements
</LEGEND>
<CIK> 0000760612
<NAME> Indian River Citrus Investors Limited Partnership
<MULTIPLIER> 1
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> MAR-31-1996
<EXCHANGE-RATE> 1
<CASH> 2977366
<SECURITIES> 0
<RECEIVABLES> 365383
<ALLOWANCES> 0
<INVENTORY> 1868608
<CURRENT-ASSETS> 5255363
<PP&E> 24469930
<DEPRECIATION> 6235836
<TOTAL-ASSETS> 23489457
<CURRENT-LIABILITIES> 24624815
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> (1135358)
<TOTAL-LIABILITY-AND-EQUITY> 23489457
<SALES> 707598
<TOTAL-REVENUES> 736517
<CGS> 257840
<TOTAL-COSTS> 618329
<OTHER-EXPENSES> 4692
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 697113
<INCOME-PRETAX> (583617)
<INCOME-TAX> 0
<INCOME-CONTINUING> (583617)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (583617)
<EPS-PRIMARY> (33.89)
<EPS-DILUTED> 00.00
</TABLE>
