SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 or 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended: Commission File Number:
March 31, 1997 2-95034LA
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ARMORED STORAGE INCOME INVESTORS LIMITED PARTNERSHIP
----------------------------------------------------
(Exact name of Registrant as specified in its charter)
Arizona 85-0503193
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(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
3839 North 3rd Street, Suite 108
Phoenix, Arizona 85012
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(Address of and zip code of principal executive offices)
(602) 230-1655
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(Registrant's telephone number, including area code)
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
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<PAGE>
ARMORED STORAGE INCOME INVESTORS LIMITED PARTNERSHIP
an Arizona Limited Partnership
PART I
FINANCIAL INFORMATION
---------------------
ITEM 1 FINANCIAL STATEMENTS PAGE
- ------ -------------------- ----
Balance Sheets 3
Statements of Operations 4
Statements of Cash Flows 5
Notes to Unaudited Financial Statements 6
<PAGE>
ARMORED STORAGE INCOME INVESTORS LIMITED PARTNERSHIP
an Arizona Limited Partnership
BALANCE SHEETS
(Unaudited)
March 31, December 31,
1997 1996
----------- -----------
ASSETS
Property
Land $ 1,139,828 $ 1,139,828
Buildings 5,856,762 5,856,762
Furniture and fixtures 74,576 74,576
----------- -----------
7,071,166 7,071,166
Less accumulated depreciation (2,098,667) (2,049,667)
----------- -----------
4,972,499 5,021,499
Cash and cash equivalents 562,128 426,865
Other assets 13,183 13,183
----------- -----------
$ 5,547,810 $ 5,461,547
=========== ===========
LIABILITIES AND PARTNERS' CAPITAL
Accounts payable $ 78,944 $ 84,851
Commitments (Note 3)
Partners' capital
General partner 53,146 52,244
Limited partners 5,415,720 5,324,452
----------- -----------
$ 5,547,810 $ 5,461,547
=========== ===========
See notes to financial statements.
<PAGE>
ARMORED STORAGE INCOME INVESTORS LIMITED PARTNERSHIP
an Arizona Limited Partnership
STATEMENTS OF OPERATIONS
(unaudited)
For the Three Months For the Years
Ended Ended
------------------- -------------------
March 31, March 31, Dec. 31, Dec. 31,
1997 1996 1996 1995
-------- -------- -------- --------
Income
Rental $275,574 $274,422 $1118,127 $1070,463
Interest 2,324 971 7,084 24,664
-------- -------- -------- --------
277,898 275,393 1125,211 1095,127
-------- -------- -------- --------
Expenses
Property Operations 113,408 95,291 393,958 406,069
Administration 23,320 35,306 84,114 87,566
Amortization &
Depreciation 49,000 49,388 196,585 197,365
Interest -0- -0- -0- 86,987
-------- -------- -------- --------
185,728 179,985 674,657 777,987
-------- -------- -------- --------
Net Income (loss) $ 92,170 $ 95,408 $450,554 $317,140
======== ======== ======== ========
See notes to financial statements.
<PAGE>
ARMORED STORAGE INCOME INVESTORS LIMITED PARTNERSHIP
an Arizona Limited Partnership
STATEMENTS OF CASH FLOWS
(unaudited)
For the three months ended
--------------------------------
March 31, 1997 March 31, 1996
-------------- --------------
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from customers $ 275,574 $ 274,422
Cash paid to suppliers (142,635) (143,673)
Interest received 2,324 971
--------- ---------
Net cash provided by (used in)
operating activities $ 135,263 $ 131,720
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CASH FLOWS FROM INVESTING ACTIVITIES
Net cash provided by (used in)
Investing activities $ -- $ --
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES
Distributions to partners -- --
--------- ---------
Net cash used in financing activities -- --
--------- ---------
Increase (decrease) in cash $ 135,263 $ 131,720
Cash and cash equivalents:
Beginning 426,865 156,104
--------- ---------
Ending $ 562,128 $ 287,824
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RECONCILIATION OF NET LOSS TO NET CASH
PROVIDED BY OPERATING ACTIVITIES:
Net income (loss) $ 92,170 $ 95,408
Adjustments to reconcile net loss to net
cash provided by operating activities:
Depreciation and amortization 49,000 49,388
Increase (decrease) in accounts payable (5,907) (13,076)
--------- ---------
Net cash provided by (used in)
operating activities $ 135,263 $ 131,720
========= =========
See notes to financial statements.
<PAGE>
ARMORED STORAGE INCOME INVESTORS LIMITED PARTNERSHIP
an Arizona Limited Partnership
NOTES TO UNAUDITED FINANCIAL STATEMENTS
March 31, 1997
NOTE 1. Partnership Organization
Armored Storage Income Investors Limited Partnership ("the Partnership")
was organized under the laws of the State of Arizona pursuant to an
agreement of limited partnership filed December 4, 1984, for the purpose
of acquiring, developing, owning and operating self-service storage
facilities. The initial General Partners were Armored Storage, Inc., an
Arizona corporation (the "Managing General Partner") and Armored Storage
One Limited Partnership, an Arizona Limited Partnership. The Partnership
commenced full activity on January 9, 1985. During 1986, the Partnership
completed an offering of limited partnership units wherein 15,000 limited
partnership units were purchased by investors for $7,500,000. In December
1987 Armored Storage, Inc., withdrew and Armored Storage One Limited
Partnership, became the "Managing General Partner."
NOTE 2. Summary of Significant Accounting Policies
Property and equipment:
Property and equipment is stated at cost. Depreciation is
computed principally by the straight-line method over the
following estimated useful lives:
Years
-----
Buildings 30
Furniture and fixtures 5
Interest, real estate taxes and other costs related directly to
properties under long-term development contracts were
capitalized. Costs were not capitalized beyond net realizable
value. Costs related to operating properties are expensed as
incurred.
Acquisition fees are allocated to the Partnership's property
based on the expected total capitalized cost of the respective
property.
Development fees are allocated to the Partnership's property
based on the expected total capitalized cost of the respective
property.
Loan acquisition costs:
Loan acquisition costs which are included in other assets are
amortized over the life of the note payable of 9 years.
Rental income:
The Partnership receives rental income from its self-storage
facilities. All rental agreements are for month-to-month tenancy.
Rental income is recognized on the accrual basis in accordance
with generally accepted accounting principles.
<PAGE>
ARMORED STORAGE INCOME INVESTORS LIMITED PARTNERSHIP
an Arizona Limited Partnership
NOTES TO UNAUDITED FINANCIAL STATEMENTS
March 31, 1997
NOTE 2. Summary of Significant Accounting Policies, continued
Income taxes:
The Partnership does not record a provision for income taxes,
since Federal and state income tax regulations provide that any
taxes on income of a Partnership are payable by the partners as
individuals. The Partnership's tax returns are prepared on the
accrual basis.
Syndication fees:
Syndication fees are those expenses incurred in the issuing and
marketing of partnership interests. These expenses include broker
and registration fees, legal fees, tax and accounting fees, and
printing costs. These fees are not amortizable and are presented
as a reduction in partners' capital in the financial statements.
Organization costs:
Organization costs which are included in other assets consist of
legal fees incident to the creation of the Partnership,
accounting fees for establishing an accounting system and filing
fees. These costs are being amortized using the straight-line
method over 60 months.
Cash and cash equivalents:
For purposes of reporting cash flows, the Partnership considers
all money market funds to be cash equivalents.
Unaudited financial statements:
The financial statement for the three months ended March 31, 1997
are unaudited, however, in management's opinion they include all
adjustments necessarily for a fair statement of the results of
operations for such interim period. The interim period results of
operations are not necessarily indicative of results for a full
year.
NOTE 3. Commitments
The Partnership has the following commitments:
The Partnership entered into agreements with QuestCor, Inc., on
November 1, 1989, to manage the Partnership's self-storage
facilities. The term of the agreements are for one year and shall
be renewed from year to year unless, and until, either party
terminates the agreements. The agreements provide that the
manager shall receive, as compensation for services, 6% of the
actual gross cash receipts.
<PAGE>
ARMORED STORAGE INCOME INVESTORS LIMITED PARTNERSHIP
an Arizona Limited Partnership
NOTES TO UNAUDITED FINANCIAL STATEMENTS
March 31, 1997
NOTE 3 Commitments, continued
The Partnership also entered into an agreement with QuestCor,
Inc. for the management of the Partnership's accounting,
securities reporting, database and investor relations activities.
The term of the agreement is for one year and shall be renewed
from year to year unless either party terminates the agreement.
The agreement provides for a flat fee of $5,000 per month as
compensation for administration services.
The Partnership reimburses the General Partner for the costs of
goods and materials used by and for the Partnership and
administrative services necessary to the operation of the
Partnership.
<PAGE>
ARMORED STORAGE INCOME INVESTORS LIMITED PARTNERSHIP
an Arizona Limited Partnership
NOTES TO UNAUDITED FINANCIAL STATEMENTS
March 31, 1997
ITEM 2 MANAGEMENT'S DISCUSSIONS AND ANALYSIS
- --------------------------------------------
Results of Operations
The Partnership has three operating facilities, two located in Phoenix,
Arizona, and one in Albuquerque, New Mexico. The Partnership's three facilities
generated an aggregate gross operating revenue of $275,574 during the first
three months of 1997 compared to $274,422 during the first three months of 1996.
Rental income increased at Bell Road but decreased at the other two facilities
compared to the prior period.
Occupancies (based on number of available units) at the three facilities
are summarized as follows:
March 31, 1997 March 31, 1996
------------------ ---------------
Bell Road 87% 83%
63rd Avenue 70% 78%
Tramway 78% 85%
Operational expenses through March 31, 1997 were $113,408 compared to
$95,291 for 1996. Administrative expenses for 1997 were $23,320 compared to
$35,306 for the corresponding period in 1996. These variances are primarily
timing differences.
Liquidity and Capital Resources
As of March 31, 1997, the Partnership held cash and cash equivalents
totaling $562,128 as compared to $287,824 for the corresponding quarter of 1996.
<PAGE>
ARMORED STORAGE INCOME INVESTORS LIMITED PARTNERSHIP
an Arizona Limited Partnership
PART II
OTHER INFORMATION
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Item 1: Legal Proceedings:
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Not applicable.
Item 2: Changes in securities:
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Not applicable.
Item 3: Defaults Upon Senior Securities:
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Not applicable.
Item 4: Submission of Matters to a Vote of Security Holders:
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Not applicable.
Item 5: Other information:
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Not applicable.
<PAGE>
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.
ARMORED STORAGE INCOME INVESTORS
(Registrant)
By: Armored Management L.L.C.
Its General Partner
By: /s/ Dale D. Ulrich
--------------------------
Dale D. Ulrich
Its: Member
Dated: 5/13/97
------------------------
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
Armored Storage Income Investors Limited Partnership
Appendix A to Item 601(c) of Regulation S-K
Commercial and Industrial Companies
Article 5 of Regulation S-X
3 Months Ended March 31, 1997
</LEGEND>
<MULTIPLIER> 1
<CURRENCY> U.S. Dollars
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-START> JAN-01-1997
<PERIOD-END> MAR-31-1997
<EXCHANGE-RATE> 1
<CASH> 562,128
<SECURITIES> 0
<RECEIVABLES> 26,036
<ALLOWANCES> 13,018
<INVENTORY> 0
<CURRENT-ASSETS> 575,311
<PP&E> 7,071,166
<DEPRECIATION> 2,098,667
<TOTAL-ASSETS> 5,547,810
<CURRENT-LIABILITIES> 78,944
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 5,468,866
<TOTAL-LIABILITY-AND-EQUITY> 5,547,810
<SALES> 0
<TOTAL-REVENUES> 277,898
<CGS> 0
<TOTAL-COSTS> 162,408
<OTHER-EXPENSES> 23,320
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 92,170
<INCOME-TAX> 0
<INCOME-CONTINUING> 92,170
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 92,170
<EPS-PRIMARY> 5.84
<EPS-DILUTED> 5.84
</TABLE>
