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 period ended March 31, 1997
-----------------------------------------------------------
[ ] 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 2-99858
_________________________________________________________
ICON Cash Flow Partners, L.P., Series A
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 13-3270490
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification Number)
600 Mamaroneck Avenue, Harrison, New York 10528-1632
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
(914) 698-0600
- --------------------------------------------------------------------------------
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.
[ x] Yes [ ] No
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
ICON Cash Flow Partners, L.P., Series A
(A Delaware Limited Partnership)
Balance Sheets
(unaudited)
<TABLE>
<S> <C> <C>
March 31, December 31,
1997 1996
Assets
Cash $ 168,531 $ 123,808
------------ ------------
Investment in financings
Receivables due in installments 197,883 246,130
Unearned income (15,432) (21,268)
Allowance for doubtful accounts (20,420) (20,420)
------------ ------------
162,031 204,442
Investment in finance leases
Minimum rents receivable 20,990 29,868
Estimated unguaranteed residual values 11,811 11,811
Unearned income (2,068) (3,160)
Allowance for doubtful accounts (24,123) (24,123)
------------ ------------
6,610 14,396
------------ ------------
Investment in operating leases
Equipment, at cost 39,887 39,887
Accumulated depreciation (39,787) (39,787)
------------ ------------
100 100
------------ ------------
Other assets 6,361 6,473
------------ ------------
Total assets $ 343,633 $ 349,219
============ ============
Liabilities and Partners' Equity
Notes payable - General Partner $ 197,238 $ 194,613
Security deposits and deferred credits 38,646 3,817
Accounts payable to General Partner and affiliates, net 38,352 43,760
Accounts payable - other 7,986 13,075
------------ ------------
282,222 255,265
Commitments and Contingencies
Partners' equity
General Partner 15,472 17,099
Limited partners (5,009 units outstanding,
$500 per unit original issue price) 45,939 76,855
------------ ------------
Total partners' equity 61,411 93,954
------------ ------------
Total liabilities and partners' equity $ 343,633 $ 349,219
============ ============
See accompanying notes to financial statements.
</TABLE>
<PAGE>
ICON Cash Flow Partners, L.P., Series A
(A Delaware Limited Partnership)
Statements of Operations
For the Three Months Ended March 31,
(unaudited)
1997 1996
---- ----
Revenues
Net gain on sales or remarketing
of equipment $ 26,309 $ 38,044
Finance income 6,928 14,608
Interest income and other 1,125 2,649
------------ ------------
Total revenues 34,362 55,301
------------ ------------
Expenses
General and administrative 2,931 8,915
Interest 2,625 5,787
Administrative expense reimbursements
- General Partner 1,297 2,028
Management fees - General Partner 735 1,152
------------ ------------
Total expenses 7,588 17,882
------------ ------------
Net income $ 26,774 $ 37,419
============ ============
Net income allocable to:
Limited partners $ 25,435 $ 35,548
General Partner 1,339 1,871
------------ ------------
$ 26,774 $ 37,419
============ ============
Weighted average number of limited
partnership units outstanding 5,009 5,009
============ ============
Net income per weighted average
limited partnership unit $ 5.08 $ 7.10
============ ============
See accompanying notes to financial statements.
<PAGE>
ICON Cash Flow Partners, L.P., Series A
(A Delaware Limited Partnership)
Statements of Changes in Partners' Equity
For the Three Months Ended March 31, 1997 and
the Years Ended December 31, 1996, 1995 and 1994
(unaudited)
<TABLE>
Limited Partner Distributions
Return of Investment Limited General
Capital Income Partners Partner Total
(Per weighted average unit)
Balance at
<S> <C> <C> <C> <C> <C>
December 31, 1993 $ 481,995 $ (86,582) $ 395,413
Cash distributions
to partners $ 32.73 $ 13.92 (233,651) (12,297) (245,948)
Net income 69,705 3,669 73,374
Capital contributions - 125,000 125,000
------------- ---------------- ---------------
Balance at
December 31, 1994 318,049 29,790 347,839
Cash distributions
to partners $ 29.09 $ 15.94 (225,533) (11,867) (237,400)
Net income 79,835 4,202 84,037
------------- ---------------- ---------------
Balance at
December 31, 1995 172,351 22,125 194,476
Cash distributions
to partners $ 19.06 $ 25.94 (225,405) (11,863) (237,268)
Net income 129,909 6,837 136,746
------------- ---------------- ---------------
Balance at
December 31, 1996 76,855 17,099 93,954
Cash distributions
to partners $ 6.17 $ 5.08 (56,351) (2,966) (59,317)
Net income 25,435 1,339 26,774
------------- ---------------- ---------------
Balance at
March 31, 1997 $ 45,939 $ 15,472 $ 61,411
============= ================ ===============
</TABLE>
See accompanying notes to financial statements.
<PAGE>
ICON Cash Flow Partners, L.P., Series A
(A Delaware Limited Partnership)
Statements of Cash Flows
For the Three Months Ended March 31,
(unaudited)
<TABLE>
1997 1996
---- ----
Cash flows from operating activities:
<S> <C> <C>
Net income $ 26,774 $ 37,419
------------ ------------
Adjustments to reconcile net income to net cash
provided by operating activities:
Net gain on sales or remarketing of equipment (26,309) (38,044)
Finance income portion of receivables paid
directly to lenders by lessees - (1,420)
Interest expense on non-recourse financing paid
directly by lessees - 1,078
Collection of principal
- non-financed receivables 44,198 78,079
Changes in operating assets and liabilities:
Allowance for doubtful accounts - 2,873
Accounts payable to General Partner
and affiliates, net (5,408) 29,531
Accounts payable - other (2,464) 745
Security deposits and deferred credits 34,829 275
Other, net 1,761 (9,534)
------------ ------------
Total adjustments 46,607 63,583
------------ ------------
Net cash provided by operating activities 73,381 101,002
------------ ------------
Cash flows from investing activities:
Proceeds from sales of equipment 30,659 51,513
------------ ------------
Net cash provided by investing activities 30,659 51,513
------------ ------------
Cash flows from financing activities:
Cash distributions to partners (59,317) (59,318)
Principal payments on term loan - (49,500)
------------ ------------
Net cash used in financing activities (59,317) (108,818)
------------ ------------
Net increase in cash 44,723 43,697
Cash at beginning of period 123,808 79,759
------------ ------------
Cash at end of period $ 168,531 $ 123,456
============ ============
</TABLE>
See accompanying notes to financial statements.
<PAGE>
ICON Cash Flow Partners, L.P., Series A
(A Delaware Limited Partnership)
Statements of Cash Flows (continued)
Supplemental Disclosures of Cash Flow Information
During the three months ended March 31, 1997 and 1996, non-cash activities
included the following:
1997 1996
---- ----
Principal and interest on direct finance receivables
paid directly to lender by lessee $ - $ 13,542
Principal and interest on non-recourse financing
paid directly by lessee - (13,542)
----------- ----------
$ - $ -
=========== =========
Interest expense of $2,625 and $5,787 for the three months ended March 31,
1997 and 1996, respectively, consisted of: interest on non-recourse financing
paid directly to lenders by lessees of $0 and $1,078, respectively, interest on
a term loan of $0 and $2,084, respectively, and interest on General Partner
loans of $2,625 and $2,625, respectively.
<PAGE>
ICON Cash Flow Partners, L.P., Series A
(A Delaware Limited Partnership)
Notes to Financial Statements
March 31, 1997
(unaudited)
1. Basis of Presentation
The financial statements of ICON Cash Flow Partners, L.P.,
Series A (the "Partnership") have been prepared pursuant to the rules and
regulations of the Securities and Exchange Commission (the "SEC") and, in the
opinion of management, include all adjustments (consisting only of normal
recurring accruals) necessary for a fair statement of income for each period
shown. Certain information and footnote disclosures normally included in
financial statements prepared in accordance with generally accepted accounting
principles have been condensed or omitted pursuant to such SEC rules and
regulations. Management believes that the disclosures made are adequate to make
the information represented not misleading. The results for the interim period
are not necessarily indicative of the results for the full year. These financial
statements should be read in conjunction with the financial statements and notes
included in the Partnership's 1996 Annual Report on Form 10-K.
2. General Partner Loan
In February 1995 and March 1995, the General Partner lent $75,000 and
$100,000, respectively, to the Partnership. Principal on the loans will be
repaid only after the extended Reinvestment Period expires, and, the limited
partners have received at least a 6% return on their capital. These notes bear
interest at the lower of 6% or prime. Interest on the loans will be paid if the
Partnership determines that there are sufficient funds available.
3. Related Party Transactions
During the three months ended March 31, 1997 and 1996 the Partnership paid
or accrued to the General Partner management fees of $735 and $1,152 and
administrative expense reimbursements of $1,297 and $2,028, respectively. These
fees and reimbursements were charged to operations.
The payment of management fees have been deferred since September 1, 1993
and as of March 31, 1997, $36,263 in management fees have been accrued but not
paid.
Under the original Partnership agreement, the General Partner was entitled
to management fees at either 2% or 5% of rents, depending on the type of
investment under management. In conjunction with the solicitation to amend the
Limited Partnership Agreement, effective, January 31, 1995, the General Partner
reduced its management fees to a flat rate of 1% of rents for all investments
under management. The General Partner previously reduced its management fees on
January 1, 1994 to a flat rate of 2%. The foregone management fees, the
difference between the flat rate (1%) and the allowable rates per the
Partnership Agreement (2% or 5%) of rents for certain types of investments,
totaled $1,565 for the three months ended March 31, 1997. These foregone
management fees are not accruable in future years.
There were no acquisition fees paid or accrued by the Partnership for the
three months ended March 31, 1997 and 1996.
In 1997 and 1996 the Partnership accrued $2,625 in interest due the
General Partner related to notes payable with the General Partner (see Note 3).
<PAGE>
ICON Cash Flow Partners, L.P., Series A
(A Delaware Limited Partnership)
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The Partnership's portfolio consisted of a net investment in financings,
finance leases and operating leases of 79%, 13% and less than 1% of total
investments at March 31, 1997, respectively, and 72%, 27% and 1% of total
investments at March 31, 1996, respectively.
Results of Operations for the Three Months Ended March 31, 1997 and 1996
Revenues for the three months ended March 31, 1997 were $34,362,
representing a decrease of $20,939 or 38% from 1996. The decrease in revenues
was primarily due to a decrease in net gain on sales or remarketing of equipment
of $11,735 or 31% and a decrease in finance income of $7,680 or 53% from 1996.
The decrease in revenues was also due to a decrease in interest income and other
of $1,524 or 58%. Net gain on sales or remarketing of equipment decreased due to
a decrease in renewal rentals received in excess of estimated unguaranteed
residual values. The decrease in finance income resulted from a decrease in the
average size of the portfolio from 1996 to 1997. The decrease in interest income
and other resulted from a decrease in the collection of late charges.
Expenses for the three months ended March 31, 1997 were $7,588,
representing a decrease of $10,294 or 58% from 1996. The decrease in expenses
was due to a decrease in general and administrative expenses of $5,984 or 67%, a
decrease in interest expense of $3,162 or 55%, a decrease in administrative
expense reimbursements of $731 or 36% and a decrease in management fees of $417
or 36% from 1996. Interest expense decreased due to the decrease in average debt
outstanding from 1996 to 1997. The decrease in general and administrative
expenses, management fees and administrative expense reimbursements resulted
from a decrease in the average size of the portfolio from 1996 to 1997.
Net income for the three months ended March 31, 1997 and 1996 was $26,774
and $37,419, respectively. The net income per weighted average limited
partnership unit was $5.08 and $7.10 in 1997 and 1996, respectively.
Liquidity and Capital Resources
The Partnership's primary sources of funds for the three months ended
March 31, 1997 and 1996 were net cash provided by operations of $73,381 and
$101,002, respectively, and proceeds from sales of equipment of $30,659 and
$51,513, respectively. These funds were used to make payments on borrowings and
to fund cash distributions. The Partnership intends to fund future cash
distributions utilizing cash provided by operations and proceeds from sales of
equipment.
In February 1995 and March 1995, the General Partner lent $75,000 and
$100,000, respectively, to the Partnership. Principal on the loans will be
repaid only after the extended Reinvestment Period expires, and, the limited
partners have received at least a 6% return on their capital. These notes bear
interest at the lower of 6% or prime. Interest on the loans will be repaid if
the Partnership determines that there are sufficient funds available.
<PAGE>
ICON Cash Flow Partners, L.P., Series A
(A Delaware Limited Partnership)
Cash distributions to limited partners for the three months ended March
31, 1997 and 1996, which were paid quarterly, totaled $56,351, of which $25,435
and $35,548 was investment income and $30,916 and $20,804 was a return of
capital, respectively. The quarterly annualized distribution rate was 9.00% , of
which 4.00% and 5.68% was investment income and 5.00% and 3.32% was a return of
capital, respectively, calculated as a percentage of each partner's initial
capital contribution. The limited partner distribution per weighted average unit
outstanding for the three months ended March 31, 1997 and 1996 was $11.25 and
$11.22 of which $5.08 and $4.12 was investment income and $6.17 and $7.10 was a
return of capital, respectively.
As of March 31, 1997, except as noted above, there were no known trends or
demands, commitments, events or uncertainties which are likely to have any
material effect on liquidity. As cash is realized from operations, sales of
equipment and borrowings, the Partnership will invest in equipment leases and
financings where it deems it to be prudent while retaining sufficient cash to
meet its reserve requirements and recurring obligations as they become due.
<PAGE>
ICON Cash Flow Partners, L.P., Series A
(A Delaware Limited Partnership)
PART II - OTHER INFORMATION
Item 6 - Exhibits and Reports on Form 8-K
No reports on Form 8-K were filed during the quarter ended March 31, 1997.
<PAGE>
ICON Cash Flow Partners, L.P., Series A
(A Delaware Limited Partnership)
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.
ICON CASH FLOW PARTNERS, L.P., SERIES A
File No. 2-99858 (Registrant)
By its General Partner,
ICON Capital Corp.
May 15, 1997 Gary N. Silverhardt
- ------------ -------------------------------------------
Date Gary N. Silverhardt
Chief Financial Officer
(Principal financial and account officer of
the General Partner of the Registrant)
<PAGE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> 5
<CIK> 0000775346
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 168,531
<SECURITIES> 0
<RECEIVABLES> 219,545
<ALLOWANCES> 44,543
<INVENTORY> 0
<CURRENT-ASSETS> * 0
<PP&E> 39,887
<DEPRECIATION> 39,787
<TOTAL-ASSETS> 343,633
<CURRENT-LIABILITIES> ** 0
<BONDS> 197,238
0
0
<COMMON> 0
<OTHER-SE> 61,411
<TOTAL-LIABILITY-AND-EQUITY> 343,633
<SALES> 34,362
<TOTAL-REVENUES> 34,362
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 4,963
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 2,625
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 26,774
<EPS-PRIMARY> 5.08
<EPS-DILUTED> 5.08
<FN>
* The Partnership has an unclassified balance sheet in its financial
statements due to the nature of its industry. A value of "0" was used for
current assets and liabilities.
** The Partnership has an unclassified balance sheet in its financial
statements due to the nature of its industry. A value of "0" was used for
current assets and liabilities.
</FN>
</TABLE>
