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, 1999
------------------------------------------
[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the transition period from to
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Commission File Number 2-99858
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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
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(Address of principal executive offices) (Zip code)
(914) 698-0600
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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.
[ 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>
March 31, December 31,
1999 1998
--------- ------------
Assets
<S> <C> <C>
Cash ....................................................... $ 2,557 $ 16,999
--------- ---------
Investment in financings
Receivables due in installments ......................... 7,147 8,934
Unearned income ......................................... (365) (569)
Allowance for doubtful accounts ......................... (1,000) (1,864)
--------- ---------
5,782 6,501
--------- ---------
Accounts receivable from General Partner and affiliates, net 1,831 --
--------- ---------
Total assets ............................................... $ 10,170 $ 23,500
========= =========
Liabilities and Partners' Equity
Accounts payable - other ................................... $ 10,038 $ 9,818
Security deposits and deferred credits ..................... -- 725
--------- ---------
10,038 10,543
--------- ---------
Commitments and Contingencies
Partners' equity (deficiency)
General Partner ......................................... 178,658 179,299
Limited partners (5,009 units outstanding,
$500 per unit original issue price) ................... (178,526) (166,342)
--------- ---------
Total partners' equity ..................................... 132 12,957
--------- ---------
Total liabilities and partners' equity ..................... $ 10,170 $ 23,500
========= =========
</TABLE>
See accompanying notes to financial statements.
<PAGE>
ICON Cash Flow Partners, L.P., Series A
(A Delaware Limited Partnership)
Statements of Operations
For the Three Months Ended March 31,
(unaudited)
1999 1998
---- ----
Revenues
Finance income .............................. $ 204 $ 1,157
Interest income and other ................... 22 1,108
Net gain on sales or remarketing of equipment -- 12,429
-------- --------
Total revenues .............................. 226 14,694
-------- --------
Expenses
General and administrative .................. 658 787
Administrative expense reimbursements
- General Partner ......................... 48 888
Management fees - General Partner ........... 27 507
Reversal of allowance for doubtful accounts . (864) (16,213)
-------- --------
Total expenses .............................. (131) (14,031)
-------- --------
Net income ..................................... $ 357 $ 28,725
======== ========
Net income allocable to:
Limited partners ............................ $ 339 $ 27,289
General Partner ............................. 18 1,436
-------- --------
$ 357 $ 28,725
======== ========
Weighted average number of limited
partnership units outstanding ............... 5,009 5,009
======== ========
Net income per weighted average
limited partnership unit .................... $ .07 $ 5.45
======== ========
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, 1999 and
the Years Ended December 31, 1998, 1997, and 1996
<TABLE>
Limited Partner Distributions
Return of Investment Limited General
Capital Income Partners Partner Total
(Per weighted average unit)
<S> <C> <C> <C> <C> <C>
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
Conversion of General Partner
note payable to a
capital contribution - 175,000 175,000
Cash distributions
to partners $ 27.85 $ 17.15 (225,405) (11,863) (237,268)
Net income 85,900 4,521 90,421
--------- -------- ---------
Balance at
December 31, 1997 (62,650) 184,757 122,107
Cash distributions
to partners $ 20.70 $ 15.55 (181,576) (9,557) (191,133)
Net income 77,884 4,099 81,983
--------- -------- ---------
Balance at
December 31, 1998 (166,342) 179,299 12,957
Cash distributions
to partners $ 2.43 $ .07 (12,523) (659) (13,182)
Net income 339 18 357
--------- -------- ---------
Balance at March 31, 1999 $(178,526) $178,658 $ 132
========= ======== =========
</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>
1999 1998
---- ----
Cash flows from operating activities:
<S> <C> <C>
Net income ................................................... $ 357 $ 28,725
-------- --------
Adjustments to reconcile net income to net cash
provided by operating activities:
Reversal of provision for bad debt .......................... (864) (16,213)
Net gain on sales or remarketing of equipment ............... -- (12,429)
Changes in operating assets and liabilities:
Collection of principal - non-financed receivables ......... 1,583 33,246
Accounts receivable from General Partner and affiliates, net (1,831) --
Accounts payable to General Partner and affiliates, net .... -- (43,106)
Accounts payable - other ................................... 220 (2,168)
Security deposits and deferred credits ..................... (725) 30,134
Other, net ................................................. -- (75)
-------- --------
Total adjustments ....................................... (1,617) (10,611)
-------- --------
Net cash provided by (used in) operating activities ...... (1,260) 18,114
-------- --------
Cash flows from investing activities:
Proceeds from sales of equipment ............................. -- 18,582
-------- --------
Net cash provided by investing activities ................ -- 18,582
-------- --------
Cash flows from financing activities:
Cash distributions to partners ............................... (13,182) (59,317)
-------- --------
Net cash used in financing activities .................... (13,182) (59,317)
-------- --------
Net decrease in cash ........................................... (14,442) (22,621)
Cash at beginning of period .................................... 16,999 89,212
-------- --------
Cash at end of period .......................................... $ 2,557 $ 66,591
======== ========
</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
There was no interest expense incurred in the three months ended March 31,
1999 and 1998.
<PAGE>
ICON Cash Flow Partners, L.P., Series A
(A Delaware Limited Partnership)
Notes to Financial Statements
March 31, 1999
(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 1998 Annual Report on Form 10-K.
2. Liquidation and Winding-Down of Partnership Affairs
As of the date of this report the General Partner is winding-down the
affairs of the Partnership and hopes to do so prior to the end of 1999 to avoid
additional year end expenses. The General Partner believes that the
Partnership's remaining cash flow approximates its remaining expenses and no
further cash distributions are likely.
3. Related Party Transactions
Fees and other expenses paid or accrued by the Partnership to the General
Partner or its affiliates for the three months ended March 31, 1999 and 1998 are
as follows:
1999 1998
---- ----
Administrative expense reimbursements $ 48 $ 888 Charged to operations
Management fees ..................... 27 507 Charged to operations
------ ------
Total ............................... $ 75 $1,395
====== ======
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.
<PAGE>
ICON Cash Flow Partners, L.P., Series A
(A Delaware Limited Partnership)
Item 2. General Partner's Discussion and Analysis of Financial Condition and
Results of Operations
The Partnership's portfolio consisted of one financing representing 100%
of total investments and no finance or operating leases at March 31, 1999 as
compared to 83%, 7% and less than 1% of total investments at March 31, 1998,
respectively.
Results of Operations for the Three Months Ended March 31, 1999 and 1998
Revenues for the three months ended March 31, 1999 were $226,
representing a decrease of $14,468 or 98% from 1998 . The decrease in revenues
is attributable to a decrease in finance income of $953 or 82%, a decrease in
interest income and other of $1,086 or 98% and a decrease in net gain on sales
or remarketing of equipment of $12,429. The decrease in finance income resulted
from a decrease in the average size of the portfolio from 1998 to 1999. The
decrease in interest income and other was the result of a decrease in late
charges collected.
There was no gain on sales or remarketing of equipment in 1999.
Expenses for the three months ended March 31,1999 were a net credit of
$131 as compared to a net credit of $14,031 for the three months ended March 31,
1998. Expenses increased due primarily to the $16,213 reduction in the allowance
for doubtful accounts in 1998. There was an $864 reduction in the allowance for
doubtful accounts in 1999. This increase was partially offset by a decrease in
administrative expense reimbursements of $840 or 95%, a decrease in management
fees of $480 or 95% and a decrease in general and administrative expense of $129
or 16%. Administrative expense reimbursements, management fees and general and
administrative expenses decreased due to the decrease in the average size of the
portfolio from 1998 to 1999.
Net income for the three months ended March 31,1999 and 1998 was $357
and $28,725, respectively. The net income per weighted average limited
partnership unit was $.07 and $5.45 for 1999 and 1998, respectively.
Liquidity and Capital Resources
As of the date of this report the General Partner is winding-down the
affairs of the Partnership and hopes to do so prior to the end of 1999 to avoid
additional year-end expenses. The General Partner believes that the
Partnership's remaining cash flow approximates its remaining expenses and no
further cash distributions are likely.
The Partnership's primary sources of funds for the three months ended
March 31, 1999 and 1998 were collection of principal on non-financed receivables
of $1,583 and $33,246, respectively, and proceeds from sales of equipment of
$18,582 in 1998. These funds were used to fund cash distributions.
<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, 1999 and 1998, which were paid quarterly, totaled $12,523 and $56,351,
respectively, of which $339 and $27,289 was investment income and $12,184 and
$29,062 was a return of capital, respectively. The quarterly annualized
distribution rate was 2.0% for 1999 and 9.00% for 1998, of which .05% and 2.08%
was investment income, respectively, and 1.95% and 6.92% 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, 1999 and 1998 was $2.50 and
$11.25, respectively, of which $.07 and $5.45 was investment income and $2.43
and $5.80 was a return of capital, respectively.
Year 2000 Issue
The Year 2000 issue arose because many existing computer programs have been
written using two digits rather than four to define the applicable year. As a
result, programs could interpret dates ending in "00" as the year 1900 rather
than the year 2000. In certain cases, such errors could result in system
failures or miscalculations that disrupt the operation of the affected
businesses.
The Partnership uses computer information systems provided by the General
Partner and has no computer information systems of its own. The software related
to the General Partner's primary computer information systems are provided by
third party vendors. The General Partner has formally communicated with these
vendors and has received assurance that their programs are Year 2000 compliant.
In addition, the General Partner has gathered information about the Year 2000
readiness of significant vendors and third-party servicers and continues to
monitor developments in this area. All of the General Partner's peripheral
computer technologies, such as its network operating system and third party
software applications, including payroll and electronic banking have been
evaluated and have been found to be Year 2000 compliant. The ultimate impact of
the Year 2000 issue on the Partnership will depend to a great extent on the
manner in which the issue is addressed by the Partnership's customer.
The General Partner is responsible for costs relating to the assessment and
development of its Year 2000 compliance remediation plan, as well as the testing
of the hardware and software owned or licensed for its personal computers. The
General Partner's costs incurred to date and expected future costs are not
material.
<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, 1999.
<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 13, 1999 /s/ Kevin F. Redmond
- ------------ ---------------------------------------------
Date Kevin F. Redmond
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
<NAME> ICON Cash Flow Partners, L.P., Series A
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<CASH> 2,557
<SECURITIES> 0
<RECEIVABLES> 7,147
<ALLOWANCES> 1,000
<INVENTORY> 0
<CURRENT-ASSETS> * 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 10,170
<CURRENT-LIABILITIES> ** 0
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 132
<TOTAL-LIABILITY-AND-EQUITY> 10,170
<SALES> 204
<TOTAL-REVENUES> 226
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 733
<LOSS-PROVISION> (864)
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 0
<INCOME-TAX> 0
<INCOME-CONTINUING> 0
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 357
<EPS-PRIMARY> .07
<EPS-DILUTED> .07
<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>
