UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
------- SECURITIES EXCHANGE ACT OF 1934
For the quarter ended
September 30, 1995
OR
------- TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Commission File Number
0-15677
-------
RAL YIELD + EQUITIES III LIMITED PARTNERSHIP
--------------------------------------------
(Exact name of registrant as specified in its charter)
Wisconsin 39-1546907
- ------------------------------- -----------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
20875 Crossroads Circle
Suite 800
Waukesha, Wisconsin 53186
- ------------------------------- -----------------------
(Address of principal (Zip Code)
executive offices)
Registrant's telephone number, including area code (414) 798-0900
--------------
Securities registered pursuant to Section 12(b) of the Act:
None
----
Securities registered pursuant to Section 12(g) of the Act:
LIMITED PARTNERSHIP INTERESTS
(Title of Class)
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
------- -------
RAL YIELD + EQUITIES III
LIMITED PARTNERSHIP
FORM 10-Q
TABLE OF CONTENTS
PAGES
PART I FINANCIAL INFORMATION
Item 1. Financial Statements I-1
Item 2. Management's Discussion and
Analysis of Financial Condition and
Results of Operations I-7
PART II OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K (None)
Signatures
<TABLE>
RAL YIELD + EQUITIES III
LIMITED PARTNERSHIP
BALANCE SHEETS AT SEPTEMBER 30, 1995 AND DECEMBER 31, 1994
<CAPTION>
UNAUDITED AUDITED
SEPT 30, DECEMBER 31,
ASSETS 1995 1994
- ------------------------------- ---------- ------------
<S> <C> <C>
INVESTMENT PROPERTIES, (net of
accumulated depreciation of
$1,888,044 and $1,724,368,
respectively) $5,639,391 $5,794,494
CASH AND CASH EQUIVALENTS 520,304 415,471
RENT AND OTHER RECEIVABLES 6,086 9,236
PREPAID EXPENSES 2,692 3,087
NOTES RECEIVABLE (net of allowance of
$60,230 and $67,633, respectively) 15,000 18,000
DEFERRED CHARGES 7,875 68,445
---------- ----------
TOTAL ASSETS $6,191,348 $6,308,733
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
- ---------------------------------
ACCOUNTS PAYABLE AND ACCRUED EXPENSES $168,747 $163,126
TENANT SECURITY DEPOSITS 68,681 64,308
PREPAID RENT 2,573 1,662
---------- ----------
TOTAL LIABILITIES $240,001 $229,096
LIMITED PARTNERS' CAPITAL 5,912,700 6,044,389
GENERAL PARTNERS' CAPITAL 38,647 35,248
---------- ----------
TOTAL PARTNERS' CAPITAL 5,951,347 6,079,637
---------- ----------
TOTAL LIABILITIES AND PARTNERS' CAPITAL $6,191,348 $6,308,733
========== ==========
<FN>
The accompanying notes are an integral part of these
statements.
</FN>
</TABLE>
<TABLE>
I-1
RAL YIELD + EQUITIES III
LIMITED PARTNERSHIP
Statement of Operations
For the three and nine months ended September 30, 1995
For the three and nine months ended September 30, 1994
UNAUDITED
<CAPTION>
3 MONTHS 9 MONTHS 3 MONTHS 9 MONTHS
ended ended ended ended
SEPT 30, SEPT 30, SEPT 30, SEPT 30,
1995 1995 1994 1994
-------- -------- -------- --------
<S> <C> <C> <C> <C>
REVENUE:
Rental income $242,203 $725,462 $236,190 $715,420
Restaurant sales 173,030 449,759 15,750 15,750
Interest and other
income 14,990 33,319 9,933 31,845
-------- -------- -------- --------
$430,223 $1,208,540 $261,873 $763,015
EXPENSES:
Operating and
administrative $76,366 $223,250 $ 79,569 $255,246
Restaurant Operating
expenses 119,255 329,279 29,134 49,440
Management fees 11,160 33,480 11,160 33,480
Real estate and other
taxes 18,295 56,037 18,976 63,110
Bad Debts 1,154 1,233 (1,000) (914)
Depreciation and
amortization 58,317 225,345 84,427 253,421
Loss on sale of
property 0 0 0 272,360
-------- -------- -------- --------
$284,547 $868,624 $222,266 $926,143
-------- -------- -------- --------
NET INCOME (LOSS) $145,676 $339,916 $ 39,607 ($163,128)
======== ======== ======== ========
<FN>
The accompanying notes are an integral part of these statements.
</FN>
</TABLE>
I-2
<TABLE>
RAL YIELD + EQUITIES III
LIMITED PARTNERSHIP
Statements of Changes in Partners' Capital
For the nine months ended September 30, 1995 and
for the year ended December 31, 1994
UNAUDITED
<CAPTION>
General Limited
Partners Partners
(1% ownership) (99% ownership) Total
-------------- --------------- --------
<S> <C> <C> <C>
BALANCE, January 1, 1994 $36,448 $8,366,855 $8,403,303
---------- ---------- ----------
NET INCOME (LOSS) (1,200) (118,828) ($120,028)
CASH DISTRIBUTIONS 0 (2,203,638) ($2,203,638)
---------- ---------- ----------
BALANCE, December 31, 1994 $35,248 $6,044,389 $6,079,637
---------- ---------- ----------
NET INCOME 3,399 336,517 339,916
CASH DISTRIBUTIONS (468,206) (468,206)
---------- ---------- ----------
BALANCE, SEPTEMBER 30, 1995 $38,647 $5,912,700 $5,951,347
========== ========== ==========
<FN>
The accompanying notes are an integral part of these
statements.
</FN>
</TABLE>
I-3
<TABLE>
RAL YIELD + EQUITIES III
LIMITED PARTNERSHIP
Statements of Cash Flows
For the nine months ended September 30, 1995 and 1994
UNAUDITED
<CAPTION>
SEPT 30, SEPT 30,
1995 1994
--------- ---------
<S> <C> <C>
CASH FLOWS FROM
OPERATING ACTIVITIES:
Net income (loss) $339,916 ($163,128)
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation and
amortization expense 225,345 253,421
Loss (Gain) on sale of assets 0 272,360
Change in assets and liabilities:
Accounts receivable 3,150 (2,105)
Notes receivable 3,000 0
Other assets 396 (2,965)
Accounts payable and
accrued expenses 5,621 (11,661)
Tenants' security deposits 4,373 3,181
Prepaid Rent 911 414
---------- ----------
Net Cash provided by
operating activities: $582,712 $349,517
CASH FLOWS FROM INVESTING
ACTIVITIES:
Net proceeds from sale of assets 0 200,100
Acquisitions of and additions to
investment properties (9,673) (84,065)
---------- ----------
Net Cash used in
investing activities (9,673) $116,035
---------- ----------
I-4
CASH FLOWS FROM FINANCING
ACTIVITIES:
Cash distributions paid ($468,206) ($2,056,485)
---------- ----------
Net cash provided by (used
in) financing activities ($468,206) ($2,056,485)
---------- ----------
Net increase (decrease)
in cash 104,833 (1,590,933)
Cash at beginning of period 415,471 2,033,490
---------- ----------
Cash at end of period $520,304 $442,557
========== ==========
<FN>
The accompanying notes are an integral part of these
statements.
</FN>
</TABLE>
I-5
RAL YIELD + EQUITIES III
LIMITED PARTNERSHIP
NOTES TO FINANCIAL STATEMENTS
Pursuant to Rule 10-01(a)(5) of Regulation S-X (17 CFR Part 210)
RAL Yield + Equities III Limited Partnership is omitting its
footnote disclosure. The Registrant has presumed that users of the
interim financial information have read or have access to the
audited financial statements for the preceding fiscal year. Copies
of the audited statements will be furnished upon request. The
disclosure is being omitted since it substantially duplicates the
disclosure contained in the most recent annual report to security
holders, Form 10-K for the fiscal year ended December 31, 1994. No
events have occurred (other than those discussed in the
Management's Discussion and Analysis of Financial Condition and
Results of Operations) subsequent to the end of the most recent
fiscal year which would have a material impact on RAL Yield +
Equities III Limited Partnership.
In the opinion of management, the unaudited financial statements
presented herein reflect all adjustments necessary to a fair
statement of the results for the interim periods presented.
I-6
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
RAL YIELD + EQUITIES III LIMITED PARTNERSHIP (the "Partnership") is
a Wisconsin Limited Partnership formed on April 29, 1985, under the
Wisconsin Revised Uniform Limited Partnership Act. The Partnership
was organized to acquire new and existing income-producing
properties. The properties consist primarily of restaurants
(including land and building) leased on a "triple net" lease basis
(i.e. for the tenant to pay for maintenance, repairs, real estate
taxes and insurance) to chain restaurants, including Hardee's,
Pizza Hut, and Wendy's. The Partnership also leases a warehouse
facility to a single tenant who sublets to various tenants. The
Partnership also owns and operates four mobile home communities
located in Wisconsin and Minnesota. The Partnership's offering of
limited partnership interests to the public pursuant to the
Securities Act of 1933 raised $13,725,000, in which the
above-described properties were purchased for cash. During 1993
four of the commercial properties and one of the mobile home
communities were sold. In 1994 an additional commercial property
was sold.
Liquidity and Capital Resources:
Properties acquired by the Partnership are generally intended to be
held from seven to ten years. During the Properties' holding
periods, the investment strategy is to maintain (on the "triple net
lease" restaurant properties) and improve (on the mobile home
parks) occupancy rates through the application of professional
property management (including selective capital improvements).
The Partnership also accumulates working capital reserves for
normal repairs, replacements, working capital, and contingencies.
Net cash flow provided by operating activities for the nine months
ended September 30 was $582,712 in 1995 and $349,517 in 1994,
primarily from earnings and depreciation (amortization). Cash flow
has increased primarily due to the Partnership operated restaurant.
The restaurant, which began operating in September, 1994,
contributed an additional $120,564 of cash flow in the first nine
months of 1995.
Cash flow has also increased as a result of lower operating costs
brought about by the sale of vacant commercial properties over the
last two years.
As of June 30, 1995, the Partnership had cash of approximately
$520,000 representing undistributed cash flow, working capital
reserves, and tenant's security deposits. Current liabilities
amounted to approximately $240,000.
I-7
Results of Operations:
Gross rental revenues for the nine months ended September 30 were
$725,462 in 1995 versus $715,420 in 1994. Operating expenses,
excluding restaurant operations, from rental properties
for the nine months ended September 30 were $223,250 in 1995 and
$255,246 in 1994.
Net Income (loss) for the nine months ended September 30 was
$339,916 in 1995 and ($163,128) in 1994. Income continues to
improve due to the addition of the Partnership operated restaurant
and the sale of vacant (non-income producing) properties. The
loss in 1994 was due to the $272,360 loss on sale of an investment
property.
The restaurant property on Howell Avenue in Milwaukee, Wisconsin
opened as a Rocky Rococo's in the fourth quarter of 1994. Revenues
of $449,843 generated $120,564 of cash flow for the partnership
during the first three quarters of 1995.
<TABLE>
The following is a listing of the approximate average physical
occupancy rates for the Partnership's mobile home parks during the
nine months ended September 30, 1995 and calendar year 1994:
<CAPTION>
9 Months Calendar
ended Sept. Year
30, 1995 1994
----------- --------
<S> <C> <C>
1. Forest Junction 98% 98%
2. Coachlite 99% 92%
3. Cloverleaf 89% 91%
4. Shamrock 94% 93%
</TABLE>
Inflation:
Due to the comparatively low level of inflation since the
Partnership commenced operations, the effect of inflation on the
Partnership has not been material to date. Should the rate of
inflation increase substantially over the life of the Partnership,
it is likely to influence ongoing operations, in particular, the
operating expenses of the Partnership. Most of the commercial
leases contain clauses permitting pass-through of certain increased
operating costs. Residential leases are typically of one year or
less in duration; this allows the Partnership to react quickly
(through rental increases) to changes in the level of inflation.
These factors should serve to reduce, to a certain degree, any
impact of rising costs on the Partnership.
I-8
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.
RAL YIELD + EQUITIES III LIMITED PARTNERSHIP
(Registrant)
Date: November 14, 1995 Robert A. Long
--------------------------
Robert A. Long
General Partner
Christine Kennedy
--------------------------
Christine Kennedy
Controller
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> SEP-30-1995
<CASH> 520,304
<SECURITIES> 0
<RECEIVABLES> 6,086
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 529,082
<PP&E> 5,639,391
<DEPRECIATION> 1,888,044
<TOTAL-ASSETS> 6,191,348
<CURRENT-LIABILITIES> 240,001
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 5,951,347
<TOTAL-LIABILITY-AND-EQUITY> 6,191,348
<SALES> 0
<TOTAL-REVENUES> 1,208,540
<CGS> 0
<TOTAL-COSTS> 868,624
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 339,916
<INCOME-TAX> 0
<INCOME-CONTINUING> 339,916
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 339,916
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
