<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
--------------------------
FORM 10-Q
(MARK ONE)
/x/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended March 31, 1996
---------------------------
OR
/ / 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 0-15686
---------
Enstar Income Program IV-3, L.P.
- --------------------------------------------------------------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
Georgia 58-1648320
- --------------------------------------------------------------------------------
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
10900 Wilshire Boulevard, 15th Floor, Los Angeles, CA 90024
- --------------------------------------------------------------------------------
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE (310) 824-9990
----------------------------
- --------------------------------------------------------------------------------
FORMER NAME, FORMER ADDRESS AND FORMER
FISCAL YEAR, IF CHANGED SINCE LAST REPORT.
Indicate by check (check) 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 (check) No
------- -------
<PAGE> 2
PART I - FINANCIAL INFORMATION
ENSTAR INCOME PROGRAM IV-3, L.P.
CONDENSED BALANCE SHEETS
---------------------------------
<TABLE>
<CAPTION>
December 31, March 31,
1995* 1996
------------- -----------
(unaudited)
<S> <C> <C>
ASSETS:
Cash and cash equivalents $ 942,400 $ 478,100
Receivables, less allowance of $9,300
and $1,500 for possible losses 27,300 9,300
Prepaid expenses and other 22,200 22,800
Equity in net assets of joint venture 828,100 647,000
Property, plant and equipment, less accumulated depreciation
and amortization of $4,143,400 and $4,257,900 1,539,700 1,471,700
Franchise cost, net of accumulated
amortization of $1,662,200 and $1,709,300 902,500 855,400
Deferred loan costs and other, net 31,600 29,400
---------- ----------
$4,293,800 $3,513,700
========== ==========
LIABILITIES AND PARTNERSHIP CAPITAL
LIABILITIES:
Accounts payable $ 503,600 $ 229,400
Due to affiliates 247,600 181,000
Note payable 383,200 -
---------- ----------
TOTAL LIABILITIES 1,134,400 410,400
---------- ----------
COMMITMENTS AND CONTINGENCIES
PARTNERSHIP CAPITAL (DEFICIT):
General partners (51,700) (52,300)
Limited partners 3,211,100 3,155,600
---------- ----------
TOTAL PARTNERSHIP CAPITAL 3,159,400 3,103,300
---------- ----------
$4,293,800 $3,513,700
========== ==========
</TABLE>
*As presented in the audited financial statements.
See accompanying notes to condensed financial statements.
-2-
<PAGE> 3
ENSTAR INCOME PROGRAM IV-3, L.P.
CONDENSED STATEMENTS OF OPERATIONS
----------------------------------
<TABLE>
<CAPTION>
Unaudited
-------------------------
Three months ended
March 31,
-------------------------
1995 1996
--------- ---------
<S> <C> <C>
REVENUES ....................................... $ 572,200 $ 584,300
--------- ---------
OPERATING EXPENSES:
Service costs ............................... 214,100 187,000
General and administrative expenses ......... 67,300 95,800
General Partner management fees
and reimbursed expenses ................... 72,300 71,300
Depreciation and amortization ............... 175,600 177,100
--------- ---------
529,300 531,200
--------- ---------
OPERATING INCOME ............................... 42,900 53,100
--------- ---------
OTHER INCOME (EXPENSE):
Interest income ............................. 6,800 7,000
Interest expense ............................ (14,900) (9,100)
--------- ---------
(8,100) (2,100)
--------- ---------
INCOME BEFORE EQUITY IN NET
INCOME OF JOINT VENTURE ..................... 34,800 51,000
EQUITY IN NET INCOME
OF JOINT VENTURE ............................ 9,700 18,800
--------- ---------
NET INCOME ..................................... $ 44,500 $ 69,800
========= =========
NET INCOME PER UNIT OF
LIMITED PARTNERSHIP INTEREST ................ $ 1.10 $ 1.73
========= =========
AVERAGE LIMITED PARTNERSHIP
UNITS OUTSTANDING DURING PERIOD ............. 39,900 39,900
========= =========
</TABLE>
See accompanying notes to condensed financial statements.
-3-
<PAGE> 4
ENSTAR INCOME PROGRAM IV-3, L.P.
STATEMENTS OF CASH FLOWS
------------------------
<TABLE>
<CAPTION>
Unaudited
----------------------
Three months ended
March 31,
----------------------
1995 1996
--------- ---------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income .............................................. $ 44,500 $ 69,800
Adjustments to reconcile net income to net
cash provided by operating activities:
Equity in net income of Joint Venture ............... (9,700) (18,800)
Depreciation and amortization ....................... 175,600 177,100
Amortization of deferred loan costs ................. 2,700 2,700
Increase (decrease) from changes in:
Accounts receivable and prepaid expenses .......... (48,600) 17,400
Accounts payable and due to affiliates ............ (10,500) (340,800)
--------- ---------
Net cash provided by (used in) operating activities 154,000 (92,600)
--------- ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures .................................... (28,700) (58,100)
Increase in intangible assets ........................... (8,000) (4,500)
Distributions from Joint Venture ........................ -- 200,000
--------- ---------
Net cash provided by (used in) investing activities . (36,700) 137,400
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Repayments of debt ...................................... -- (383,200)
Distributions to partners ............................... (125,900) (125,900)
--------- ---------
(125,900) (509,100)
--------- ---------
DECREASE IN CASH AND CASH EQUIVALENTS ...................... (8,600) (464,300)
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD .................................. 664,900 942,400
--------- ---------
CASH AND CASH EQUIVALENTS
AT END OF PERIOD ........................................ $ 656,300 $ 478,100
========= =========
</TABLE>
See accompanying notes to condensed financial statements.
-4-
<PAGE> 5
ENSTAR INCOME PROGRAM IV-3, L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS
=======================================
1. INTERIM FINANCIAL STATEMENTS
The accompanying condensed interim financial statements for the three
months ended March, 1996 and 1995 are unaudited. These condensed interim
financial statements should be read in conjunction with the audited financial
statements and notes thereto included in the Partnership's latest Annual Report
on Form 10-K. In the opinion of management, such statements reflect all
adjustments (consisting only of normal recurring adjustments) necessary for a
fair presentation of the results of such periods. The results of operations for
the three months ended March 31, 1996 are not necessarily indicative of results
for the entire year.
2. TRANSACTIONS WITH THE GENERAL PARTNER AND AFFILIATES
The Partnership has a management and service agreement with a
wholly-owned subsidiary of the Corporate General Partner (the "Manager") for a
monthly management fee of 5% of revenues, excluding revenues from the sale of
cable television systems or franchises. Management fees approximated $29,200 for
the three months ended March 31, 1996.
In addition to the monthly management fees described above, the
Partnership reimburses the Manager for direct expenses incurred on behalf of the
Partnership and for the Partnership's allocable share of operational costs
associated with services provided by the Manager. All cable television
properties managed by the Corporate General Partner and its subsidiaries are
charged a proportionate share of these expenses. Corporate office allocations
and district office expenses are charged to the properties served based
primarily on the respective percentage of basic subscribers or homes passed
(dwelling units within a system) within the designated service areas. The total
amount charged to the Partnership for these services approximated $42,100 for
the three months ended March 31, 1996.
The Manager has entered into an identical agreement with Enstar Cable
of Macoupin County, a Georgia General Partnership, of which the Partnership is a
co-partner (the "Macoupin Joint Venture"), except that the Joint Venture pays
the Manager only a 4% management fee. However, the Joint Venture is required to
distribute to Enstar Communications Corporation (which is the Corporate General
Partner of the Macoupin County Joint Venture as well as of the Partnership) an
amount equal to 1% of the Joint Venture's gross revenues in respect of Enstar
Communications Corporation's interest as Corporate General Partner of the Joint
Venture. No management fee is payable by the Partnership in respect of any
amounts received by the Partnership from the Macoupin Joint Venture, and there
is no duplication of reimbursed expenses and costs of the Manager. The Macoupin
Joint Venture paid the Manager management fees of approximately $17,000 and
reimbursement of expenses of $33,000 under its management agreement for the
three months ended March 31, 1996. In addition, the Macoupin Joint Venture paid
the Corporate General Partner approximately $4,300 in respect of its 1% special
interest during the three months ended March 31, 1996. Management fees and
reimbursed expenses due the Corporate General Partner are non-interest bearing.
-5-
<PAGE> 6
ENSTAR INCOME PROGRAM IV-3, L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(CONTINUED)
=======================================
2. TRANSACTIONS WITH THE GENERAL PARTNER AND AFFILIATES (CONCLUDED)
The Partnership also receives certain system operating management
services from an affiliate of the Corporate General Partner in addition to the
Manager, due to the fact that there are no such employees directly employed by
one of the Partnership's cable systems. The Partnership reimburses the affiliate
for its allocable share of the affiliates' operational costs. The total amount
charged to the Partnership approximated $5,300 for these costs in the three
months ended March 31, 1996. No management fee is payable to the affiliate by
the Partnership and there is no duplication of reimbursed expenses and costs
paid to the Manager.
Certain programming services have been purchased through an affiliate
of the Partnership and the Macoupin Joint Venture. In turn, the affiliate
charges the Partnership and the Joint Venture for these costs based on an
estimate of what the entities could negotiate for such programming on a
stand-alone basis. The Partnership paid the affiliate $129,500 and the Macoupin
Joint Venture paid the affiliate $94,200 for these programming services for the
three months ended March 31, 1996. Programming fees are included in service
costs in the statements of operations for the three months ended March 31, 1996
and 1995.
3. EARNINGS PER UNIT OF LIMITED PARTNERSHIP INTEREST
Earnings and losses per unit of limited partnership interest is based
on the average number of units outstanding during the periods presented. For
this purpose, earnings and losses are allocated 99% to the limited partners and
1% to the general partners.
4. RECLASSIFICATIONS
Certain 1995 amounts have been reclassified to conform to the 1996
presentations.
-6-
<PAGE> 7
ENSTAR INCOME PROGRAM IV-3, L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS
(CONTINUED)
=======================================
5. EQUITY IN NET ASSETS OF JOINT VENTURE
Each of the Partnership and two affiliated partnerships (Enstar Income
Program IV-1, L.P. and Enstar Income Program IV-2, L.P.) owns one third (1/3) of
Enstar Cable of Macoupin County (the "Macoupin Joint Venture"). Each of the
co-partners shares equally in the profits and losses of the Macoupin Joint
Venture. The investment in the Macoupin Joint Venture is accounted for on the
equity method. Summarized financial information for the Macoupin Joint Venture
as of March 31, 1996 and December 31, 1995 and the results of its operations for
the three months ended March 31, 1996 and 1995 have been included. The results
of operations for the three months ended March 31, 1996 are not necessarily
indicative of results for the entire year.
<TABLE>
<CAPTION>
December 31, March 31,
1995* 1996
---------- ----------
(unaudited)
<S> <C> <C>
Current assets ............................. $1,110,000 $ 755,500
Investment in cable television
properties, net ........................ 1,722,800 1,598,300
Other assets ............................... 7,300 7,200
---------- ----------
$2,840,100 $2,361,000
========== ==========
Current liabilities ........................ $ 355,500 $ 420,100
Venturers' capital ......................... 2,484,600 1,940,900
---------- ----------
$2,840,100 $2,361,000
========== ==========
</TABLE>
*As presented in the audited financial statements.
-7-
<PAGE> 8
ENSTAR INCOME PROGRAM IV-3, L.P.
NOTES TO CONDENSED FINANCIAL STATEMENTS (CONCLUDED)
===================================================
ENSTAR CABLE OF MACOUPIN COUNTY
<TABLE>
<CAPTION>
Unaudited
----------------------
Three months ended
March 31,
----------------------
1995 1996
----------------------
<S> <C> <C>
REVENUES ................................................. $ 399,100 $ 425,200
--------- ---------
OPERATING EXPENSES:
Service costs ......................................... 125,900 129,600
General and administrative expenses ................... 32,600 41,300
General Partner management fees and reimbursed expenses 55,300 54,300
Depreciation and amortization ......................... 162,300 151,800
--------- ---------
376,100 377,000
--------- ---------
OPERATING INCOME ......................................... 23,000 48,200
OTHER INCOME (EXPENSE):
Interest income ....................................... 6,900 9,400
Interest expense ...................................... (900) (1,100)
--------- ---------
NET INCOME ............................................... $ 29,000 $ 56,500
========= =========
</TABLE>
-8-
<PAGE> 9
ENSTAR INCOME PROGRAM IV-3, L.P.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
INTRODUCTION
On February 8, 1996, President Clinton signed into law the
Telecommunications Act of 1996 (the "1996 Telecom Act"). This statute
substantially changed the competitive and regulatory environment for
telecommunications providers by significantly amending the Communications Act of
1934, including certain of the rate regulation provisions previously imposed by
the Cable Television Consumer Protection and Competition Act of 1992 (the "1992
Cable Act"). Compliance with those rate regulations has had a negative impact on
the Partnership's revenues and cash flow. However, the Partnership believes that
recent policy decisions by the Federal Communications Commission (the "FCC")
will permit it to increase regulated service rates in the future in response to
specified historical and anticipated future cost increases, although certain
costs may continue to rise at a rate in excess of that which the Partnership
will be permitted to pass on to its customers. The 1996 Telecom Act provides
that certain of the rate regulations will be phased-out altogether in 1999.
Further, the regulatory environment will continue to change pending, among other
things, the outcome of legal challenges and FCC rulemaking and enforcement
activity in respect of the 1992 Cable Act and the completion of a significant
number of FCC rulemakings under the 1996 Telecom Act. There can be no assurance
as to what, if any, future action may be taken by the FCC, Congress or any other
regulatory authority or court, or the effect thereof on the Partnership's
business. Accordingly, the Partnership's historic interim financial results as
described below are not necessarily indicative of future performance.
In addition to the information set forth in this report, reference is
made to the Partnership's Annual Report on Form 10-K for the year ended December
31, 1995 for additional information regarding regulatory matters and the effect
thereof on the Partnership's business.
RESULTS OF OPERATIONS
THE PARTNERSHIP
The Partnership's revenues increased from $572,200 to $584,300, or by
2.1%, for the quarter ended March 31, 1996 as compared to the corresponding
period in 1995. Of the $12,100 increase in revenues, $31,000 was due to
increases in regulated service rates permitted under the 1992 Cable Act that
were implemented by the Partnership in April 1995 and $1,400 resulted from
increases in other revenue producing items. These increases were partially
offset by a $20,300 decrease in the number of subscriptions for service.
Service costs decreased from $214,100 to $187,000, or by 12.7%, for the
quarter ended March 31, 1996 as compared to the corresponding period in 1995.
Service costs represent costs directly attributable to providing cable services
to customers. Of the $27,100 decrease, $12,000 was due to a decrease in
personnel costs, $11,200 was due to an increase in capitalization of labor and
overhead costs and $3,500 was due to a decrease in programming fees. These
decreases were partially offset by a $3,400 increase in franchise fees.
-9-
<PAGE> 10
ENSTAR INCOME PROGRAM IV-3, L.P.
RESULTS OF OPERATIONS (CONTINUED)
General and administrative expenses increased from $67,300 to $95,800,
or by 42.4%, for the quarter ended March 31, 1996 as compared to the
corresponding period in 1995. Of the $28,500 increase, $8,500 was due to higher
insurance premiums, $7,500 was due to an increase in personnel costs, $2,700 was
due to an increase in bad debt expense, $2,200 was due to an increase in
marketing expense and $2,200 was due to an increase in customer billing expense.
Management fees and reimbursed expenses decreased from $72,300 to
$71,300, or by 1.4%, for the quarter ended March 31, 1996 as compared to the
corresponding period in 1995. Of the $1,000 decrease, $1,600 was due to a
decrease in reimbursed expenses allocated by the Corporate General Partner,
including lower allocated office rent, marketing expense, personnel costs and
telephone expense. These decreases were partially offset by management fee
increases of 2.2% directly related to increased revenues as described above.
Depreciation and amortization expense increased by $1,500 from $175,600
to $177,100 (less than one-percent) for the quarter ended March 31, 1996 as
compared to the corresponding period in 1995.
Operating income increased by $10,200 from $42,900 to $53,100, or by
23.8%, for the quarter ended March 31, 1996 as compared to the corresponding
period in 1995, principally due to increased revenues and decreased service
costs as described above.
Interest income increased by $200 from $6,800 to $7,000, or by 2.9%,
for the quarter ended March 31, 1996 as compared to the corresponding period in
1995 due to higher average cash balances available for investment.
Interest expense decreased by $5,800 from $14,900 to $9,100, or by
38.9%, for the quarter ended March 31, 1996 as compared to the corresponding
period in 1995 due to the repayment of the note payable in February 1996.
DISTRIBUTIONS TO PARTNERS
The Partnership distributed $125,900 to its partners during the quarter
ended March 31, 1996. The Joint Venture distributed $200,000 to the Partnership
during the three months ended March 31, 1996.
THE MACOUPIN JOINT VENTURE
The Joint Venture's revenues increased from $399,100 to $425,200, or by
6.5%, for the quarter ended March 31, 1996 as compared to the corresponding
period in 1995. Of the $26,100 increase in revenues, $24,600 was due to
increases in regulated service rates permitted under the 1992 Cable Act that
were implemented by the Partnership in April 1995 and $2,500 resulted from
increases in other revenue producing items. These increases were partially
offset by a $1,000 decrease in the number of subscriptions for service.
Service costs increased from $125,900 to $129,600, or by 2.9%, for the
quarter ended March 31, 1996 as compared to the corresponding period in 1995.
Service costs represent costs directly attributable
-10-
<PAGE> 11
ENSTAR INCOME PROGRAM IV-3, L.P.
RESULTS OF OPERATIONS (CONCLUDED)
to providing cable services to customers. Of the $3,700 increase, $5,500 was due
to an increase in programming fees charged by program suppliers (including
primary satellite fees), $4,400 was due to an increase in personnel costs and
$1,600 was due to an increase in system power costs. These increases were
partially offset by an increase of $6,200 in capitalization of labor and
overhead expense and a $2,600 decrease in repair and maintenance expense. The
increase in programming expenses was also due to expanded programming usage
relating to channel line-up restructuring and to retransmission consent
arrangements implemented to comply with the 1992 Cable Act.
General and administrative expenses increased from $32,600 to $41,300,
or by 26.7%, for the quarter ended March 31, 1996 as compared to the
corresponding period in 1995. Of the $8,700 increase, $4,000 was due to an
increase in bad debt expense, $2,200 was due to an increase in customer billing
expense and $2,100 was due to an increase in personnel costs.
Management fees and reimbursed expenses decreased from $55,300 to
$54,300, or by 1.8%, for the quarter ended March 31, 1996 as compared to the
corresponding period in 1995. Of the $1,000 decrease, $2,300 was due to a
decrease in reimbursed expenses allocated by the Corporate General Partner
including lower allocated office rent, marketing expense and telephone expense.
These decreases were partially offset by a $1,300 increase in management fees in
direct relation to increased revenues as described above.
Depreciation and amortization expense decreased by $10,500 from
$162,300 to $151,800, or by 6.5%, for the quarter ended March 31, 1996 as
compared to the corresponding period in 1995 due to the effect of certain
tangible assets becoming fully depreciated and certain intangible assets
becoming fully amortized.
Operating income increased by $25,200 from $23,000 to $48,200, or by
110%, for the quarter ended March 31, 1996 as compared to the corresponding
period in 1995, principally due to decreased depreciation and amortization and
increased revenues as described above.
Interest income, net of interest expense, increased by $2,300 from
$6,000 to $8,300, or by 38.3%, for the quarter ended March 31, 1996 as compared
to the corresponding period in 1995 due to higher average cash balances
available for investment.
Operating income before depreciation and amortization (EBITDA) as a
percentage of revenues increased from 46.4% to 47.0% for the quarter ended March
31, 1996 as compared to the corresponding period in 1995. The increase was
primarily caused by increased revenues as described above. Accordingly, EBITDA
increased from $185,300 to $200,000, or by 7.9%, for the quarter ended March 31,
1996 as compared to the corresponding period in 1995.
-11-
<PAGE> 12
ENSTAR INCOME PROGRAM IV-3, L.P.
LIQUIDITY AND CAPITAL RESOURCES
The FCC's amended rate regulation rules were implemented during the
quarter ended September 30, 1994. Compliance with these rules has had a negative
impact on the Partnership's revenues and cash flow.
The Partnership's primary objective, having invested its net offering
proceeds in cable systems and the Joint Venture, is to distribute to its
partners all available cash flow from operations and proceeds from the sale of
cable systems, if any, after providing for expenses, debt service and capital
requirements relating to the expansion, improvement and upgrade of its cable
systems. The Partnership relies upon the availability of cash generated from
operations and possible borrowings to fund its ongoing expenses, debt service
and capital requirements. In general, these requirements involve expansion,
improvement and upgrade of the Partnership's existing cable television systems.
The Partnership has budgeted 1996 capital expenditures of $1,441,000, which
include costs of $978,000 for completing the rebuild in the community of
Shelbyville, Illinois. Additionally, the Joint Venture has budgeted 1996 capital
expenditures totaling $348,700 for the upgrade of its existing cable plant and
for the first segment of a $1,500,000 rebuild in the community of Auburn,
Illinois.
Management believes that existing cash and cash generated by operations
of the Partnership and Joint Venture will be adequate to fund capital
expenditures and the continued payment of distributions in 1996. Management also
believes that it is essential to preserve liquidity by reserving cash for future
rebuild requirements, including the continued future rebuild in the community of
Auburn, Illinois.
The Partnership paid distributions totaling $125,900 during the three
months ended March 31, 1996. However, there can be no assurances regarding the
level, timing or continuation of future distributions beyond 1996.
On February 9, 1996, the Partnership repaid the balance of $383,200 on
its $1,000,000 revolving bank credit facility, which terminated the facility.
THREE MONTHS ENDED MARCH 31, 1996 AND 1995
Operating activities used net cash of $92,600 in the three months ended
March 31, 1996 as compared with the prior year period when operating activities
provided net cash totaling $154,000. The change was primarily due to a $330,300
increase in cash used to pay liabilities owed to the General Partner and
third-party creditors in the 1996 period. This was offset by an increase of
$66,000 for cash provided in accounts receivable and prepaid expenses. The
Partnership's net income increased by $17,700 after adding back non-cash items
consisting of depreciation, amortization and equity in net income of Joint
Venture.
Investing activities provided net cash of $137,400 in the three months
ended March 31, 1996 as compared with the prior year period when investing
activities used net cash totaling $36,700. The change was due to a $200,000
increase in distributions from the Joint Venture and a $3,500 decrease in
expenditures for intangible assets, partially offset by a $29,400 increase in
capital expenditures. Cash used in financing activities used $383,200 more cash
during the three months ended March 31, 1996 than in the comparable three months
of 1995 due to the repayment of the revolving bank credit facility.
-12-
<PAGE> 13
ENSTAR INCOME PROGRAM IV-3, L.P.
LIQUIDITY AND CAPITAL RESOURCES (CONCLUDED)
Operating income before depreciation and amortization (EBITDA) as a
percentage of revenues increased from 38.2% to 39.4% for the quarter ended March
31, 1996 as compared to the corresponding period in 1995. The increase was
primarily caused by decreases in service costs as described above. Accordingly,
EBITDA increased from $218,500 to $230,200, or by 5.4%, for the quarter ended
March 31, 1996 as compared to the corresponding period in 1995.
INFLATION
Certain of the Partnership's expenses, such as those for wages and
benefits, equipment repair and replacement, and billing and marketing generally
increase with inflation. However, the Partnership does not believe that its
financial results have been, or will be, adversely affected by inflation in a
material way, provided that it is able to increase its service rates
periodically, of which there can be no assurance.
-13-
<PAGE> 14
ENSTAR INCOME PROGRAM IV-3, L.P.
PART II. OTHER INFORMATION
ITEMS 1-5. Not applicable.
ITEM 6. Exhibits and Reports on Form 8-K
(a) None
(b) No Reports on Form 8-K were filed during the
quarter for which this report is filed.
-14-
<PAGE> 15
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.
ENSTAR INCOME PROGRAM IV-3, L.P.
a GEORGIA LIMITED PARTNERSHIP
-----------------------------
(Registrant)
By: ENSTAR COMMUNICATIONS CORPORATION
General Partner
Date: May 9, 1996 By: /s/ Michael K. Menerey
-----------------------
Michael K. Menerey,
Chief Financial Officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE BALANCE
SHEET AT MARCH 31, 1996, AND THE STATEMENTS OF OPERATIONS FOR THE THREE MONTHS
ENDED MARCH 31, 1996, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 478,100
<SECURITIES> 0
<RECEIVABLES> 10,800
<ALLOWANCES> 1,500
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 5,729,600
<DEPRECIATION> 4,257,900
<TOTAL-ASSETS> 3,513,700
<CURRENT-LIABILITIES> 410,400
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 3,513,700
<SALES> 0
<TOTAL-REVENUES> 584,300
<CGS> 0
<TOTAL-COSTS> 531,200
<OTHER-EXPENSES> (7,000)
<LOSS-PROVISION> 3,800
<INTEREST-EXPENSE> 9,100
<INCOME-PRETAX> 69,800
<INCOME-TAX> 0
<INCOME-CONTINUING> 69,800
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 69,800
<EPS-PRIMARY> 1.73
<EPS-DILUTED> 0
</TABLE>
