[TEST]
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U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarter ended September 30, 1995 Commission File Number 2-98025
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SIGNATURE VII LTD. LIMITED PARTNERSHIP
- ------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Indiana 35-1636684
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(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
250 East 96th Street, Suite 450, Indianapolis, Indiana 46240
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(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code (317) 581-1111
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Check whether the Registrant (1) has filed all reports required to be filed by
Sections 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months, and (2) has been subject to such filing requirements for
the past 90 days.
Yes X No
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SIGNATURE VII LTD. LIMITED PARTNERSHIP
INDEX
Part I - FINANCIAL INFORMATION
- ------------------------------
Item 1. Financial Statements (Unaudited)
Balance Sheets
September 30, 1995 and December 31, 1994
Statements of Operations
Three and nine months ended September 30, 1995 and 1994
Statement of Partners' Equity
Nine months ended September 30, 1995 and year ended
December 31, 1994
Statements of Cash Flows
Nine months ended September 30, 1995 and 1994
Note to Financial Statements
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations
Part II - OTHER INFORMATION
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<TABLE>
SIGNATURE VII LTD. LIMITED PARTNERSHIP
Balance Sheets
(Unaudited)
<CAPTION>
September 30, December 31,
1995 1994
------------ ------------
ASSETS
<S> <C> <C>
Current assets:
Cash and cash equivalents $724,171 533,943
Accounts receivable 65,702 26,785
Other current assets 64,775 75,134
---------- ----------
Total current assets 854,648 635,862
Property and equipment:
Land 792,528 792,528
Land improvements 449,003 443,417
Buildings 5,626,128 5,374,062
Furniture and equipment 1,713,372 1,639,006
---------- ----------
8,581,031 8,249,013
Less accumulated depreciation 2,895,276 2,779,148
---------- ----------
Net property and equipment 5,685,755 5,469,865
Furniture and equipment reserves 74,613 131,419
Deferred costs, net of accumulated
amortization of $364,140 and $342,816 87,745 60,567
---------- ----------
$6,702,761 6,297,713
========== ==========
LIABILITIES AND PARTNERS' EQUITY
Current liabilities:
Current portion of long-term debt 95,467 98,674
Accounts payable 50,642 35,428
Accrued payroll and related taxes 22,896 30,594
State and local taxes 143,952 125,653
Accrued interest - 4,574
---------- ----------
Total current liabilities 312,957 294,923
Long-term debt, less current portion 4,932,083 4,706,957
---------- ----------
Total liabilities 5,245,040 5,001,880
Partners' equity 1,457,721 1,295,833
---------- ----------
$6,702,761 6,297,713
========== ==========
</TABLE>
<PAGE>
<TABLE>
SIGNATURE VII LTD. LIMITED PARTNERSHIP
Statements of Operations
(Unaudited)
<CAPTION>
Three Months Ended Nine Months Ended
September 30 September 30
___________________________ _________________________
1995 1994 1995 1994
__________ _________ __________ __________
<S> <C> <C> <C> <C>
Revenue:
Room revenue $ 945,395 841,960 2,508,985 2,185,905
Other hotel revenue 31,953 29,678 100,094 90,377
Interest 7,475 4,674 18,935 8,469
_________ ________ __________ __________
985,823 876,312 2,628,014 2,284,751
_________ ________ __________ __________
Cost and expenses:
Hotel operations 262,638 245,947 758,306 656,706
Salaries and benefits 220,565 189,500 578,129 515,159
Management and franchise fees 87,746 78,055 233,574 203,694
Advertising and reservations 34,123 30,355 90,834 79,215
Interest 129,001 129,696 383,362 388,889
Depreciation and amortization 64,473 62,593 193,553 187,779
_________ ________ __________ __________
798,546 736,146 2,237,758 2,031,442
_________ ________ __________ __________
Net income 187,277 140,166 390,256 253,309
General partner's interest 46,819 35,041 97,564 63,327
_________ ________ __________ __________
Limited partner's interest $ 140,458 105,125 292,692 189,982
========= ======== ========== ==========
Limited partner's interest per unit $ 311.44 233.09 648.98 421.25
========= ======== ========== ==========
Average number of limited partner
units outstanding 451 451 451 451
========== ======== ========== ==========
</TABLE>
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<TABLE>
SIGNATURE VII LTD. LIMITED PARTNERSHIP
Statement of Partners' Equity
Nine months ended September 30, 1995
(Unaudited)
<CAPTION>
General Limited
Partner Partners Total
_________ ________ _________
<S> <C> <C> <C>
Balance at
December 31, 1994 $442,661 853,172 1,295,833
Net income 97,564 292,692 390,256
Cash distributions (57,092) (171,276) (228,368)
Balance at September 30, 1995 $483,133 974,588 1,457,721
======== ======== =========
Accumulated balances:
Capital
contributions 1,503,333 4,510,000 6,013,333
Offering expenses - (474,671) (474,671)
Cash distributions (233,587) (700,908) (934,495)
Net loss (786,613) (2,359,833) (3,146,446)
_________ __________ __________
Balance at
September 30, 1995 $483,133 974,588 1,457,721
========= ========== ==========
</TABLE>
<PAGE>
<TABLE>
SIGNATURE VII LTD. LIMITED PARTNERSHIP
Statements of Cash Flows
(Unaudited)
<CAPTION>
Nine months ended
September 30
______________________________
1995 1994
__________ _________
<S> <C> <C>
Cash flows from operating activities:
Net income $390,256 253,309
Items which do not use (provide)
cash:
Depreciation of property
and equipment 184,897 178,055
Amortization of deferred costs 8,656 9,724
Write off of deferred loan costs 12,668 2,369
Accrued revenue and other
expenses, net (2,743) 12,061
_________ ________
Net cash provided by
operating activities 593,734 455,518
_________ ________
Cash flows from investing activities:
Additions to furniture and
equipment reserves, net (140,532) (71,859)
Other additions to property
and equipment (203,449) -
_________ _________
Net cash used in
investing activities (343,981) (71,859)
_________ _________
Cash flows from financing activities:
Payments on long-term debt (19,985) (92,691)
Proceeds from long-term debt 237,330 -
Deferred financing costs (48,502) -
Cash distributions to partners (228,368) (71,559)
_________ _________
Net cash used in
financing activities (59,525) (164,250)
_________ _________
Change in cash and cash equivalents 190,228 219,409
_________ _________
Cash and cash equivalents at
beginning of period 533,943 287,542
_________ _________
Cash and cash equivalents
at end of period $724,171 506,951
========= =========
Additional disclosures:
Interest paid $383,362 388,889
========= =========
Additions to property and
equipment from furniture and
equipment reserves $197,338 24,475
========= =========
</TABLE>
<PAGE>
SIGNATURE VII LTD. LIMITED PARTNERSHIP
NOTE TO FINANCIAL STATEMENTS (UNAUDITED)
SEPTEMBER 30, 1995
NOTE A - BASIS OF PRESENTATION
The accompanying unaudited financial statements have been prepared in
accordance with generally accepted accounting principles for interim financial
information. Accordingly, the financial statements do not include all of the
information and footnotes required by generally accepted accounting principles
for complete financial statements. In the opinion of management, all
adjustments (consisting of normal recurring accruals) considered necessary for
a fair presentation have been included. Operating results for the interim
period are not necessarily indicative of the results that may be expected for
the year ended December 31, 1995. For further information, refer to the
financial statements included in the Partnership's annual report on Form
10-KSB for the year ended December 31, 1994.
<PAGE>
<TABLE>
SIGNATURE VII LTD. LIMITED PARTNERSHIP
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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
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AND RESULTS OF OPERATIONS
-------------------------
RESULTS OF OPERATIONS
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<CAPTION>
Occupancy Average Daily Rate
YTD YTD YTD YTD
9/30/95 9/30/94 Change 9/30/95 9/30/94 Change
<S> <C> <C> <C> <C> <C> <C>
Columbus 64.9% 62.8% 2.1% $56.10 $53.41 $2.69
Kokomo 83.5% 71.7% 11.8% $55.18 $52.75 $2.43
QTD QTD Percent YTD YTD Percent
9/30/95 9/30/94 Change 9/30/95 9/30/94 Change
<S> <C> <C> <C> <C> <C> <C>
Room &
Other Hotel
Revenues $978,348 $871,638 12.2% $2,609,079 $2,276,282 14.6%
Interest
Income $7,475 $4,674 59.9% $18,935 $8,469 123.6%
Hotel Operations
and Salaries and
Benefits $483,203 $435,447 11.0% $1,336,435 $1,171,865 14.0%
Management
and Franchise
Fees $87,746 $78,055 12.4% $233,574 $203,694 14.7%
Advertising and
Reserv $34,123 $30,355 12.4% $90,834 $79,215 14.7%
Interest
Expense $129,001 $129,696 (0.5)% $383,362 $388,889 (1.4)%
Depreciation and
Amort $64,473 $62,593 3.0% $193,553 $187,779 3.1%
Net
Income $187,277 $140,166 33.6% $390,256 $253,309 54.1%
</TABLE>
Room and other hotel revenues of the two hotels increased for both the three
and nine month periods ended September 30, 1995 compared to the same period
in 1994 due to increases in occupancy and average room rates.
Hotel operations and salaries and benefits represent all of the operational
and administrative costs of operating the hotels, including all payroll,
supply, utilities, maintenance and miscellaneous expenses. Hotel operations
and salaries and benefits increased primarily due to the increase in the
number of rooms sold during the first nine months of 1995 compared to 1994.
Management and franchise fees increased due to the increase in room and other
hotel revenues for the same periods. These fees represent amounts paid to
Signature Inns, Inc., the general partner of the Partnership, for property
management, accounting services and franchise fees.
<PAGE>
The Partnership contributes to a cooperative advertising and reservation fund
administered by the general partner. Contributions increased due to the
increase in room and other hotel revenues for the periods.
Interest expense represents interest on hotel mortgage loans and capitalized
equipment leases. Interest expense decreased due to the scheduled
amortization reduction of the notes, offset slightly by interest expense on
additional borrowings on the Kokomo loan during the second quarter of 1995.
Additionally, the mortgage loan on the Kokomo hotel was refinanced in January
1995 at a lower interest rate than the retired indebtedness.
LIQUIDITY AND CAPITAL RESOURCES
The general partner believes that cash generated from the operation of the two
hotels, along with existing cash balances, will provide adequate liquidity for
the Partnership to meet its operating needs during the next twelve months.
<PAGE>
PART II - OTHER INFORMATION
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Item 1. Legal Proceedings
See note below
Item 2. Changes in Securities
See note below
Item 3. Default upon Senior Securities
See note below
Item 4. Submission of matters to a Vote of Security Holders
See note below
Item 5. Other Information
See note below
Item 6. Exhibits and Reports on Form 8-K
See note below
NOTE: The response to each of the above items is not
applicable or is in the negative and does not
require a response pursuant to the instructions.
<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.
SIGNATURE INNS, INC., General Partner
of Signature VII Ltd. Limited Partnership
Date November 10, 1995 By
----------------- ---------------------------------------
John D. Bontreger, President and C.E.O.
Signature Inns, Inc.
Date November 10, 1995 By
----------------- ---------------------------------------
Mark D. Carney, Vice President
Finance and C.F.O.
Signature Inns, Inc.
Date November 10, 1995 By
----------------- ---------------------------------------
Martin D. Brew, Treasurer/Controller
Signature Inns, Inc.
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from the
Consolidated Balance Statement and Consolidated Statement of Operations of
Signature VII Ltd. Limited Partnership as of and for the three month period
ended September 30, 1995, and is qualified in its entirety by reference to such
financial statements.
</LEGEND>
<CIK> 0000769603
<NAME> SIGNATURE VII LTD. LIMITED PARTNERSHIP
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> SEP-30-1995
<CASH> 724,171
<SECURITIES> 0
<RECEIVABLES> 65,702
<ALLOWANCES> 0
<INVENTORY> 64,775
<CURRENT-ASSETS> 854,648
<PP&E> 8,581,031
<DEPRECIATION> 2,895,276
<TOTAL-ASSETS> 6,702,761
<CURRENT-LIABILITIES> 312,957
<BONDS> 4,932,083
<COMMON> 0
0
0
<OTHER-SE> 1,457,721
<TOTAL-LIABILITY-AND-EQUITY> 6,702,761
<SALES> 0
<TOTAL-REVENUES> 985,823
<CGS> 0
<TOTAL-COSTS> 605,072
<OTHER-EXPENSES> 64,473
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 129,001
<INCOME-PRETAX> 187,277
<INCOME-TAX> 0
<INCOME-CONTINUING> 187,277
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 187,277
<EPS-PRIMARY> 415.25
<EPS-DILUTED> 415.25
</TABLE>
