<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[x] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the quarterly period ended September 30, 1996.
------------------
[_] 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: 0-13193
CABLE TV FUND 12-A, LTD.
- --------------------------------------------------------------------------------
Exact name of registrant as specified in charter
Colorado #84-0968104
- --------------------------------------------------------------------------------
State of organization I.R.S. employer I.D.#
9697 East Mineral Avenue, P.O. Box 3309, Englewood, Colorado 80155-3309
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Address of principal executive office
(303) 792-3111
----------------------------------
Registrant's telephone number
Indicate by check mark whether the registrant (l) has filed all reports required
to be filed by Section l3 or l5(d) of the Securities Exchange Act of l934 during
the preceding l2 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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CABLE TV FUND 12-A, LTD.
------------------------
(A Limited Partnership)
UNAUDITED BALANCE SHEETS
------------------------
<TABLE>
<CAPTION>
September 30, December 31,
ASSETS 1996 1995
------ ------------- -----------
<S> <C> <C>
CASH $ 1,073,639 $ 1,307,723
TRADE RECEIVABLES, less allowance for
doubtful receivables of $40,583 and $100,732
at September 30, 1996 and December 31, 1995, respectively 594,353 914,397
INVESTMENT IN CABLE TELEVISION PROPERTIES:
Property, plant and equipment, at cost 83,078,065 78,674,556
Less- accumulated depreciation (51,425,016) (46,771,823)
------------ ------------
31,653,049 31,902,733
Franchise costs and other intangible assets, net of
accumulated amortization of $33,201,288 and
$32,573,148 at September 30, 1996 and
December 31, 1995, respectively 1,823,801 2,389,839
------------ ------------
Total investment in cable television properties 33,476,850 34,292,572
DEPOSITS, PREPAID EXPENSES AND DEFERRED CHARGES 316,990 310,414
------------ ------------
Total assets $ 35,461,832 $ 36,825,106
============ ============
</TABLE>
The accompanying notes to unaudited financial statements
are an integral part of these unaudited balance sheets.
2
<PAGE>
CABLE TV FUND 12-A, LTD.
------------------------
(A Limited Partnership)
UNAUDITED BALANCE SHEETS
------------------------
<TABLE>
<CAPTION>
September 30, December 31,
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT) 1996 1995
------------------------------------------- ------------- ------------
<S> <C> <C>
LIABILITIES:
Debt $ 25,028,250 $ 26,736,382
Accounts payable - General Partner - 373,311
Trade accounts payable and accrued liabilities 1,638,979 1,674,946
Subscriber prepayments 152,290 123,690
------------ ------------
Total liabilities 26,819,519 28,908,329
------------ ------------
PARTNERS' CAPITAL (DEFICIT):
General Partner-
Contributed capital 1,000 1,000
Accumulated deficit (362,085) (369,340)
------------ ------------
(361,085) (368,340)
------------ ------------
Limited Partners-
Net contributed capital (104,000 units
outstanding at September 30, 1996 and
December 31, 1995) 44,619,655 44,619,655
Accumulated deficit (35,616,257) (36,334,538)
------------ ------------
9,003,398 8,285,117
------------ ------------
Total liabilities and partners' capital (deficit) $ 35,461,832 $ 36,825,106
============ ============
</TABLE>
The accompanying notes to unaudited financial statements
are an integral part of these unaudited balance sheets.
3
<PAGE>
CABLE TV FUND 12-A, LTD.
------------------------
(A Limited Partnership)
UNAUDITED STATEMENTS OF OPERATIONS
----------------------------------
<TABLE>
<CAPTION>
For the Three Months Ended For the Nine Months Ended
September 30, September 30,
---------------------------- ---------------------------
1996 1995 1996 1995
------------ ---------- ----------- -----------
<S> <C> <C> <C> <C>
REVENUES $8,409,908 $7,884,435 $25,591,136 $23,788,788
COSTS AND EXPENSES:
Operating expenses 5,086,001 4,703,889 15,299,000 14,058,482
Management fees and allocated overhead
from General Partner 908,386 932,749 2,902,625 2,861,409
Depreciation and amortization 1,754,634 1,740,832 5,330,414 5,377,584
---------- ---------- ----------- -----------
OPERATING INCOME 660,887 506,965 2,059,097 1,491,313
---------- ---------- ----------- -----------
OTHER INCOME (EXPENSE):
Interest expense (416,598) (492,393) (1,280,073) (1,532,779)
Other, net (49,656) 64,621 (53,488) (10,730)
---------- ---------- ----------- -----------
Total other income
(expense), net (466,254) (427,772) (1,333,561) (1,543,509)
---------- ---------- ----------- -----------
NET INCOME (LOSS) $ 194,633 $ 79,193 $ 725,536 $ (52,196)
========== ========== =========== ===========
ALLOCATION OF NET INCOME (LOSS):
General Partner $ 1,946 $ 792 $ 7,255 $ (522)
========== ========== =========== ===========
Limited Partners $ 192,687 $ 78,401 $ 718,281 $ (51,674)
========== ========== =========== ===========
NET INCOME (LOSS) PER
LIMITED PARTNERSHIP UNIT $1.85 $.75 $6.91 $(.50)
========== ========== =========== ===========
WEIGHTED AVERAGE NUMBER
OF LIMITED PARTNERSHIP
UNITS OUTSTANDING 104,000 104,000 104,000 104,000
========== ========== =========== ===========
</TABLE>
The accompanying notes to unaudited financial statements
are an integral part of these unaudited statements.
4
<PAGE>
CABLE TV FUND 12-A, LTD.
------------------------
(A Limited Partnership)
UNAUDITED STATEMENTS OF CASH FLOWS
----------------------------------
<TABLE>
<CAPTION>
For the Nine Months Ended
September 30,
----------------------------
1996 1995
----------- ------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 725,536 $ (52,196)
Adjustments to reconcile net income (loss) to net
cash provided by operating activities:
Depreciation and amortization 5,330,414 5,377,584
Amortization of interest rate protection contract - 37,503
Decrease (increase) in trade receivables 320,044 (99,516)
Increase in deposits, prepaid expenses and
deferred charges (55,657) (242,136)
Decrease in amount due General Partner (373,311) (1,305,933)
Decrease in trade accounts payable,
accrued liabilities and subscriber prepayments (7,367) (413,503)
----------- ------------
Net cash provided by operating activities 5,939,659 3,301,803
----------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment (4,403,509) (4,007,066)
Franchise renewal costs (62,102) -
----------- ------------
Net cash used in investing activities (4,465,611) (4,007,066)
----------- ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings 82,524 28,571,560
Repayment of debt (1,790,656) (28,244,201)
----------- ------------
Net cash provided by (used in) financing activities (1,708,132) 327,359
----------- ------------
Decrease in cash (234,084) (377,904)
Cash, beginning of period 1,307,723 578,657
----------- ------------
Cash, end of period $ 1,073,639 $ 200,753
=========== ============
SUPPLEMENTAL CASH FLOW DISCLOSURE:
Interest paid $ 1,388,935 $ 1,520,439
=========== ============
</TABLE>
The accompanying notes to unaudited financial statements
are an integral part of these unaudited statements.
5
<PAGE>
CABLE TV FUND 12-A, LTD.
------------------------
(A Limited Partnership)
NOTES TO UNAUDITED FINANCIAL STATEMENTS
---------------------------------------
(1) This Form 10-Q is being filed in conformity with the SEC requirements for
unaudited financial statements and does not contain all of the necessary
footnote disclosures required for a fair presentation of the Balance Sheets and
Statements of Operations and Cash Flows in conformity with generally accepted
accounting principles. However, in the opinion of management, this data includes
all adjustments, consisting only of normal recurring accruals, necessary to
present fairly the financial position of Cable TV Fund 12-A, Ltd. (the
"Partnership") at September 30, 1996 and December 31, 1995, its Statements of
Operations for the three and nine month periods ended September 30, 1996 and
1995 and its Statements of Cash Flows for the nine month periods ended September
30, 1996 and 1995. Results of operations for these periods are not necessarily
indicative of results to be expected for the full year.
The Partnership owns and operates the cable television systems serving
areas in and around Fort Myers, Florida; Lake County, Illinois (the "Lake County
System"); and Orland Park/Park Forest, Illinois (the "Orland Park System").
(2) Jones Intercable, Inc. ("Intercable"), a publicly held Colorado
corporation, is the "General Partner" and manages the Partnership and receives a
fee for its services equal to 5 percent of the gross revenues of the
Partnership, excluding revenues from the sale of cable television systems or
franchises. Management fees paid to the General Partner by the Partnership for
the three and nine month periods ended September 30, 1996 were $420,495 and
$1,279,557, respectively, compared to $394,222 and $1,189,439, respectively, for
the similar 1995 periods.
The Partnership reimburses the General Partner for certain allocated
overhead and administrative expenses. These expenses represent the salaries and
related benefits paid for corporate personnel, rent, data processing services
and other facilities costs. Such personnel provide engineering, marketing,
administrative, accounting, legal and investor relations services to the
Partnership. Allocations of personnel costs are based primarily on actual time
spent by employees of the General Partner with respect to each partnership
managed. Remaining expenses are allocated based on the pro rata relationship of
the Partnership's revenues to the total revenues of all systems owned or managed
by the General Partner, and certain of its subsidiaries. Systems owned by the
General Partner and all other systems owned by partnerships for which Intercable
is the general partner are also allocated a proportionate share of these
expenses. The General Partner believes that the methodology used in allocating
overhead and administrative expenses is reasonable. Reimbursements by the
Partnership to the General Partner for allocated overhead and administrative
expenses for the three and nine month periods ended September 30, 1996 were
$487,891 and $1,623,068, respectively, compared to $538,527 and $1,671,970,
respectively, for the similar 1995 periods.
(3) Certain prior year amounts were reclassified to conform to the 1996
presentation.
6
<PAGE>
CABLE TV FUND 12-A, LTD.
------------------------
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
---------------------------------------------------------------
RESULTS OF OPERATIONS
---------------------
FINANCIAL CONDITION
- -------------------
It is the General Partner's publicly announced policy that it intends to
liquidate its managed limited partnerships, including the Partnership, as
opportunities for sales of partnership cable television systems arise in the
marketplace over the next several years. In accordance with the General
Partner's policy, the Lake County System and the Orland Park System, along with
other Chicago-area systems owned or managed by the General Partner and its
affiliates, were recently marketed for sale. The deadline set by the General
Partner for receipt of indications of interest for such systems from prospective
buyers was October 15, 1996. The General Partner did not receive any offer for
the Lake County System or Orland Park System. The General Partner will continue
to explore other alternatives for sale; however, no specific plans have yet been
determined. There is no assurance as to the timing or terms of any sales.
For the nine months ended September 30, 1996, the Partnership generated net
cash from operating activities totaling approximately $5,940,000, which is
available to fund capital expenditures and non-operating costs. Capital
expenditures totaled approximately $4,404,000 during the first nine months of
1996. Approximately 35 percent of these expenditures related to the construction
of service drops to subscribers' homes. Approximately 30 percent of the
expenditures related to the construction of new cable plant and approximately 9
percent of these expenditures was for premium service security equipment. The
remaining expenditures were used for various enhancements in the Partnership's
systems. Funding for these expenditures was provided by cash on hand and cash
generated from operations. Anticipated capital expenditures for the remainder of
1996 are approximately $1,712,000. Approximately 41 percent will be used for the
construction of service drops to subscribers' homes and approximately 20 percent
is to be used for construction of new cable plant. The remainder of the
anticipated expenditures is expected to be used for various enhancements in all
of the Partnership's systems. These capital expenditures are necessary to
maintain the value of the Partnership's systems. Funding for these expenditures
is expected to be provided by cash on hand, cash generated from operations and,
if necessary, borrowings available under the Partnership's credit facility.
The Partnership is a party to a $30,000,000 revolving credit facility that
will expire on December 31, 1996, at which time the then-outstanding balance
will convert to a term loan. The term loan will be payable in 20 consecutive
quarterly installments that will commence on March 31, 1997. At September 30,
1996, $24,800,000 was outstanding under this credit facility, leaving $5,200,000
of available borrowings before the end of the year. Interest is at the
Partnership's option of the Prime Rate or a fixed rate defined as the London
Interbank Offered Rate plus 1 percent. The effective interest rates on
outstanding obligations as of September 30, 1996 and 1995 were approximately
6.53 percent and approximately 6.91 percent, respectively.
The General Partner believes that the Partnership has sufficient sources of
capital from cash on hand, cash generated from operations and borrowings
available under its credit facility to meet its presently anticipated needs.
RESULTS OF OPERATIONS
- ---------------------
Revenues of the Partnership increased $525,473, or approximately 7 percent,
to $8,409,908 for the three month period ended September 30, 1996 from
$7,884,435 for the comparable 1995 period. Revenues of the Partnership increased
$1,802,348, or approximately 8 percent, to $25,591,136 for the nine month period
ended September 30, 1996 from $23,788,788 for the comparable 1995 period. An
increase in the number of basic service subscribers combined with basic service
rate increases implemented in the Partnership's systems primarily accounted for
the increase in revenues. The increase in the number of basic service
subscribers accounted for approximately 42 percent and 41 percent, respectively,
of the increase in basic service revenues for the three and nine month periods
ended September 30, 1996 and basic service rate increases accounted for
approximately 34 percent and 35 percent, respectively, of the increase in basic
service revenues for the three and nine month periods ended September 30, 1996.
The number of basic service subscribers increased by 2,955 subscribers, or
approximately 4 percent, to 75,310 at September 30, 1996 from 72,355 at
September 30, 1995. No other individual factor was significant to the increase
in revenues.
7
<PAGE>
Operating expenses consist primarily of costs associated with the
administration of the Partnership's cable television systems. The principal cost
components are salaries paid to system personnel, programming expenses,
professional fees, subscriber billing costs, rent for leased facilities, cable
system maintenance expenses and consumer marketing expenses.
Operating expenses increased $382,112, or approximately 8 percent, to
$5,086,001 for the three month period ended September 30, 1996 from $4,703,889
for the comparable 1995 period. Increases in programming fees primarily
accounted for the increase in operating expenses for the three month period.
Operating expenses represented approximately 60 percent of revenues for each of
the three month periods ended September 30, 1996 and 1995. Operating expenses
increased $1,240,518, or approximately 9 percent, to $15,299,000 for the nine
month period ended September 30, 1996 from $14,058,482 for the comparable 1995
period. Increases in programming fees and plant related costs primarily
accounted for the increase in operating expenses for the nine month periods.
Operating expenses represented approximately 60 percent of revenues for the nine
month period ended September 30, 1996 and approximately 59 percent of revenues
for the similar 1995 period. No other individual factor was significant to the
increase in operating expenses.
Management fees and allocated overhead from the General Partner decreased
$24,363, or approximately 3 percent, to $908,386 for the three month period
ended September 30, 1996 from $932,749 for the comparable 1995 period. This
decrease was due to a decrease in allocated expenses from the General Partner.
Management fees and allocated overhead from the General Partner increased
$41,216, or approximately 1 percent, to $2,902,625 for the nine month period
ended September 30, 1996 from $2,861,409 for the comparable 1995 period. This
increase was due to an increase in management fees due to the increase in
revenues, upon which such management fees are based.
Depreciation and amortization expense increased $13,802, or approximately 1
percent, to $1,754,634 for the three month period ended September 30, 1996 from
$1,740,832 for the comparable 1995 period. This increase was due to capital
additions during 1996. Depreciation and amortization expense decreased $41,170,
or approximately 1 percent, to $5,330,414 for the nine month period ended
September 30, 1996 from $5,377,584 for the comparable 1995 period. This decrease
was due to the maturation of the Partnership's depreciable asset base.
Operating income increased $153,922, or approximately 30 percent, to
$660,887 for the three month period ended September 30, 1996 from $506,965 for
the comparable period in 1995. This increase was due to the increase in revenues
and decrease in management fees and allocated overhead from the General Partner
exceeding the increases in operating expenses and depreciation and amortization
expense. Operating income increased $567,784, or approximately 38 percent, to
$2,059,097 for the nine month period ended September 30, 1996, from $1,491,313
for the comparable period in 1995. This increase was due to the increase in
revenues and decrease in depreciation and amortization expense exceeding the
increases in operating expenses and management fees and allocated overhead from
the General Partner.
The cable television industry generally measures the financial performance
of a cable television system in terms of cash flow or operating income before
depreciation and amortization. The value of a cable television system is often
determined using multiples of cash flow. This measure is not intended to be a
substitute or improvement upon the items disclosed on the financial statements,
rather it is included because it is an industry standard. Operating income
before depreciation and amortization increased $167,724, or approximately 7
percent, to $2,415,521 for the three month period ended September 30, 1996 from
$2,247,797 for the similar period in 1995. This increase was due to the increase
in revenues and decrease in management fees and allocated overhead from the
General Partner exceeding the increase in operating expenses. Operating income
before depreciation and amortization increased $520,614, or approximately 8
percent, to $7,389,511 for the nine month period ended September 30, 1996 from
$6,868,897 for the comparable 1995 period. This increase was due to the increase
in revenues exceeding the increases in operating expenses and management fees
and allocated overhead from the General Partner.
Interest expense decreased $75,795, or approximately 15 percent, to
$416,598 for the three month period ended September 30, 1996 from $492,393 for
the comparable 1995 period. Interest expense decreased $252,706, or
approximately 16 percent, to $1,280,073 for the nine month period ended
September 30, 1996 from $1,532,779 for the comparable 1995 period. These
decreases were due to lower effective interest rates and lower outstanding
balances on interest bearing obligations.
8
<PAGE>
Net income increased $115,440, to $194,633 for the three month period ended
September 30, 1996 from $79,193 for the comparable 1995 period. The Partnership
recognized net income of $725,536 for the nine month period ended September 30,
1996, compared to a net loss of $52,196 for the comparable 1995 period. These
changes were due to the factors discussed above.
9
<PAGE>
Part II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
a) Exhibits
27) Financial Data Schedule
b) Reports on Form 8-K
None
10
<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.
CABLE TV FUND 12-A, LTD.
BY: JONES INTERCABLE, INC.
General Partner
By:/S/ Kevin P. Coyle
---------------------------------
Kevin P. Coyle
Group Vice President/Finance
(Principal Financial Officer)
Dated: November 12, 1996
11
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 1,073,639
<SECURITIES> 0
<RECEIVABLES> 594,353
<ALLOWANCES> (40,583)
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 83,078,065
<DEPRECIATION> (51,425,016)
<TOTAL-ASSETS> 35,461,832
<CURRENT-LIABILITIES> 1,791,280
<BONDS> 25,028,250
0
0
<COMMON> 0
<OTHER-SE> 9,003,397
<TOTAL-LIABILITY-AND-EQUITY> 35,461,832
<SALES> 0
<TOTAL-REVENUES> 25,591,136
<CGS> 0
<TOTAL-COSTS> 23,532,039
<OTHER-EXPENSES> 53,488
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 1,280,073
<INCOME-PRETAX> 725,536
<INCOME-TAX> 0
<INCOME-CONTINUING> 725,536
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 725,536
<EPS-PRIMARY> 6.91
<EPS-DILUTED> 6.91
</TABLE>
