<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the quarterly period ended June 30, 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: 0-14906
JONES CABLE INCOME FUND 1-B, LTD.
- --------------------------------------------------------------------------------
Exact name of registrant as specified in charter
Colorado 84-1010417
- --------------------------------------------------------------------------------
State of organization I.R.S. employer I.D.#
9697 East Mineral Avenue, P.O. Box 3309, Englewood, Colorado 80155-3309
-------------------------------------------------------------------------
Address of principal executive office
(303) 792-3111
-----------------------------
Registrant's telephone number
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
----- -----
<PAGE>
JONES CABLE INCOME FUND 1-B, LTD.
---------------------------------
(A Limited Partnership)
UNAUDITED BALANCE SHEETS
------------------------
<TABLE>
<CAPTION>
June 30, December 31,
ASSETS 1997 1996
------ ----------- ------------
<S> <C> <C>
CASH $ 145 $ 145
INVESTMENT IN CABLE TELEVISION JOINT VENTURE 2,471,537 1,162,877
------------ ------------
Total assets $ 2,471,682 $ 1,163,022
============ ============
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
-------------------------------------------
PARTNERS' CAPITAL (DEFICIT):
General Partner-
Contributed capital $ 1,000 $ 1,000
Accumulated earnings 106,837 96,162
Distributions (110,219) (110,219)
------------ ------------
(2,382) (13,057)
------------ ------------
Limited Partners-
Net contributed capital (83,884 units
outstanding at June 30, 1997 and
December 31, 1996) 34,449,671 34,449,671
Accumulated deficit (2,887,666) (10,151,011)
Distributions (29,087,941) (23,122,581)
------------ ------------
2,474,064 1,176,079
------------ ------------
Total liabilities and partners'
capital (deficit) $ 2,471,682 $ 1,163,022
============ ============
</TABLE>
The accompanying notes to unaudited financial statements
are an integral part of these unaudited balance sheets.
2
<PAGE>
JONES CABLE INCOME FUND 1-B, LTD.
---------------------------------
(A Limited Partnership)
UNAUDITED STATEMENTS OF OPERATIONS
----------------------------------
<TABLE>
<CAPTION>
For the Three Months Ended For the Six Months Ended
June 30, June 30,
---------------------------- -------------------------
1997 1996 1997 1996
----------- ---------- ----------- ------------
<S> <C> <C> <C> <C>
REVENUES $ - $ - $ - $ 862,911
COSTS AND EXPENSES:
Operating expenses - - - 730,908
Management fees and allocated
overhead from General Partner - - - 106,575
Depreciation and amortization - - - 227,488
----------- --------- ----------- -----------
OPERATING LOSS - - - (202,060)
----------- --------- ----------- -----------
OTHER INCOME (EXPENSE):
Interest expense - - - (123,888)
Gain on sale of cable television system - - - 11,122,663
Other, net - (37,636) - 129,817
----------- --------- ----------- -----------
Total other income (expense), net - (37,636) - 11,128,592
----------- --------- ----------- -----------
INCOME (LOSS) BEFORE EQUITY
IN NET INCOME (LOSS) OF CABLE
TELEVISION JOINT VENTURE - (37,636) - 10,926,532
EQUITY IN NET INCOME (LOSS) OF
CABLE TELEVISION JOINT
VENTURE (591) (302,048) 7,274,020 (707,092)
----------- --------- ----------- -----------
NET INCOME (LOSS) $ (591) $(339,684) $7,274,020 $10,219,440
=========== ========= =========== ===========
ALLOCATION OF NET INCOME (LOSS):
General Partner $ (6) $ 305,722 $ 10,675 $ 300,087
=========== ========= =========== ===========
Limited Partners $ (585) $(645,406) $7,263,345 $ 9,919,353
=========== ========= =========== ===========
NET INCOME (LOSS) PER LIMITED
PARTNERSHIP UNIT $(.01) $(7.69) $86.58 $118.25
=========== ========= =========== ===========
WEIGHTED AVERAGE NUMBER
OF LIMITED PARTNERSHIP
UNITS OUTSTANDING 83,884 83,884 83,884 83,884
=========== ========= =========== ===========
</TABLE>
The accompanying notes to unaudited financial statements
are an integral part of these unaudited statements.
3
<PAGE>
JONES CABLE INCOME FUND 1-B, LTD.
---------------------------------
(A Limited Partnership)
UNAUDITED STATEMENTS OF CASH FLOWS
----------------------------------
<TABLE>
<CAPTION>
For the Six Months Ended
June 30,
--------------------------
1997 1996
----------- ------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 7,274,020 $ 10,219,440
Adjustments to reconcile net income to net
cash used in operating activities:
Depreciation and amortization - 227,488
Equity in net loss (income) of cable television
joint venture (7,274,020) 707,092
Gain on sale of cable television system - (11,122,663)
Decrease in trade receivables - 247,500
Decrease in deposits, prepaid expenses
and deferred charges - 124,580
Decrease in accrued liabilities and
subscriber prepayments - (427,201)
----------- ------------
Net cash used in operating activities - (23,764)
----------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment, net - (156,802)
Proceeds from the sale of cable television system - 18,347,667
Distributions from cable television joint venture 5,965,360 -
----------- ------------
Net cash provided by investing activities 5,965,360 18,190,865
----------- ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings - 18,135
Repayment of debt - (6,884,281)
Distributions to limited partners (5,965,360) (11,104,875)
Decrease in accrued distributions - (250,000)
----------- ------------
Net cash used in financing activities (5,965,360) (18,221,021)
----------- ------------
Decrease in cash - (53,920)
Cash, beginning of period 145 54,135
----------- ------------
Cash, end of period $ 145 $ 215
=========== ============
SUPPLEMENTAL CASH FLOW DISCLOSURE:
Interest paid $ - $ -
=========== ============
</TABLE>
The accompanying notes to unaudited financial statements
are an integral part of these unaudited statements.
4
<PAGE>
JONES CABLE INCOME FUND 1-B, LTD.
---------------------------------
(A Limited Partnership)
NOTES TO UNAUDITED FINANCIAL STATEMENTS
---------------------------------------
(1) This Form 10-Q is being filed in conformity with the SEC requirements for
unaudited financial statements and does not contain all of the necessary
footnote disclosures required for a fair presentation of the Balance Sheets and
Statements of Operations and Cash Flows in conformity with generally accepted
accounting principles. However, in the opinion of management, this data includes
all adjustments, consisting only of normal recurring accruals, necessary to
present fairly the financial position of Jones Cable Income Fund 1-B, Ltd. (the
"Partnership") at June 30, 1997 and December 31, 1996, its results of operations
for the three and six month periods ended June 30, 1997 and 1996 and its cash
flows for the six month periods ended June 30, 1997 and 1996. Results of
operations for these periods are not necessarily indicative of results to be
expected for the full year.
Jones Intercable, Inc. ("Intercable"), a publicly held Colorado
corporation, is the "General Partner."
The Partnership previously owned and operated the cable television system
serving the areas in and around Orangeburg, South Carolina (the "Orangeburg
System"). The Partnership sold the Orangeburg System on February 28, 1996. In
addition, the Partnership owns a 40 percent interest in Jones Cable Income Fund
1-B/C Venture (the "Venture"). The Venture owns and operates the cable
television systems serving Lake County, California; Myrtle Creek, Oregon; South
Sioux City, Nebraska; and Three Rivers and Watervliet, Michigan. The Venture
also owned and operated the cable television system serving the areas in and
around Brighton, Broomfield and Boulder County, Colorado (the "Colorado
Systems") until their sale on January 24, 1997. (See Note 2.)
(2) On January 24, 1997, the Venture sold the Colorado Systems to an
unaffiliated party for a sales price of $35,000,000, subject to customary
closing adjustments. The Venture distributed a total of $15,000,000 to the
Partnership and Jones Cable Income Fund 1-C, Ltd. ("Fund 1-C") in February 1997,
which amount represents the net sale proceeds following the Venture's repayment
of a portion of the balance outstanding on its credit facility. The Partnership
received $5,965,360 and Fund 1-C received $9,034,640 of such distribution. The
Partnership, in turn, distributed the $5,965,360 (approximately $142 per each
$1,000 invested in the Partnership) to the limited partners of the Partnership.
Because the distribution to the limited partners of the Partnership together
with all prior distributions did not return the amount initially contributed by
the limited partners to the Partnership plus the preferred return provided by
the Partnership's limited partnership agreement, the General Partner did not
receive a distribution from the sale proceeds. The Jones Group, Ltd., a
subsidiary of Intercable, received a brokerage fee from the Venture of $875,000,
representing 2.5 percent of the sales price, for acting as a broker in this
transaction. Because the sale of the Colorado Systems did not represent a sale
of all or substantially all of the Partnership's assets, no vote of the limited
partners of the Partnership was required to approve this sale.
The pro forma effect of the sale of the Colorado Systems on the results
of the Venture's operations for the six months ended June 30, 1997 and 1996,
assuming the transaction had occurred at the beginning of the year, is presented
in the following unaudited tabulation:
For the Six Months Ended June 30, 1997
--------------------------------------
Unaudited
Pro Forma Unaudited
As Reported Adjustments Pro Forma
----------- ------------- ----------
Revenues $ 9,353,542 $ (508,159) $8,845,383
=========== ============ ==========
Operating Income $ 122,788 $ 355,074 $ 477,862
=========== ============ ==========
Net Income $18,290,220 $(17,896,268) $ 393,952
=========== ============ ==========
5
<PAGE>
For the Six Months Ended June 30, 1996
---------------------------------------
<TABLE>
<CAPTION>
Unaudited
Pro Forma Unaudited
As Reported Adjustments Pro Forma
------------ ------------ ------------
<S> <C> <C> <C>
Revenues $12,117,745 $(3,730,666) $ 8,387,079
=========== =========== ===========
Operating Loss $ (236,518) $ (33,683) $ (270,201)
=========== =========== ===========
Net Loss $(1,777,952) $ 645,749 $(1,132,203)
=========== =========== ===========
</TABLE>
(3) The General Partner manages the Partnership and receives a fee for its
services equal to 5 percent of the gross revenues of the Partnership, excluding
revenues from the sale of cable television systems or franchises. Management
fees for the three and six month periods ended June 30, 1997 (exclusive of the
Partnership's 40 percent interest in the Venture) were $-0- and $-0- compared to
$-0- and $43,146, respectively, for the similar 1996 periods.
The Partnership reimburses the General Partner for certain allocated
overhead and administrative expenses. These expenses represent the salaries and
related benefits paid for corporate personnel, rent, data processing and other
corporate facilities costs. Such personnel provide engineering, marketing,
administrative, accounting, legal and investor relations services to the
Partnership. Such services, and their related costs, are necessary to the
operations of the Partnership and would have been incurred by the Partnership if
it was a stand alone entity. Allocations of personnel costs are based primarily
on actual time spent by employees of the General Partner with respect to each
partnership managed. Remaining overhead costs are allocated based on revenues
of the Partnership as a percentage of total revenues of owned and managed cable
television systems of the General Partners. Systems owned by the General
Partner and all other systems owned by partnerships for which Jones Intercable,
Inc. is the general partner are also allocated a proportionate share of these
expenses. The General Partner believes that the methodology used in allocating
overhead and administrative expenses is reasonable. Amounts charged the
Partnership by the General Partner for allocated overhead and administrative
expenses for the three and six month periods ending June 30, 1997 (exclusive of
the Partnership's 40 percent interest in the Venture) were $-0- and $-0-
compared to $-0- and $63,429, respectively, for the similar 1996 periods.
(4) Financial information regarding the Venture is presented below.
UNAUDITED BALANCE SHEETS
------------------------
<TABLE>
<CAPTION>
ASSETS June 30, 1997 December 31, 1996
------ -------------- ------------------
<S> <C> <C>
Cash and accounts receivable $ 1,082,680 $ 1,232,665
Investment in cable television properties 30,400,463 45,932,002
Other assets 625,928 391,576
------------ ------------
Total assets $ 32,109,071 $ 47,556,243
============ ============
LIABILITIES AND PARTNERS' CAPITAL
---------------------------------
Debt $ 24,594,081 $ 42,559,250
Accounts payable and accrued liabilities 1,289,861 2,062,084
Partners' contributed capital, net 24,504,008 39,504,008
Accumulated deficit (18,278,879) (36,569,099)
------------ ------------
Total liabilities and partners' capital $ 32,109,071 $ 47,556,243
============ ============
</TABLE>
6
<PAGE>
UNAUDITED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
For the Three Months Ended For the Six Months Ended
June 30, June 30,
-------------------------- --------------------------
1997 1996 1997 1996
---------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Revenues $4,507,844 $ 6,160,349 $ 9,353,542 $12,117,745
Operating expenses 2,497,384 3,380,680 5,466,347 6,756,806
Management fees and allocated overhead
from Jones Intercable, Inc. 466,837 710,038 1,045,076 1,413,011
Depreciation and amortization 1,217,187 2,080,134 2,719,331 4,184,446
---------- ----------- ----------- -----------
Operating income (loss) 326,436 (10,503) 122,788 (236,518)
Interest expense (328,933) (762,094) (710,376) (1,559,497)
Gain on sale of cable television system - - 18,889,257 -
Other, net 1,012 13,111 (11,449) 18,063
---------- ----------- ----------- -----------
Net income (loss) $ (1,485) $ (759,486) $18,290,220 $(1,777,952)
========== =========== =========== ===========
</TABLE>
Management fees paid to Intercable by the Venture totaled $225,392 and
$467,677, respectively, for the three and six months ended June 30, 1997
compared to $308,017 and $605,887, respectively, for the similar 1996 periods.
Reimbursements for overhead and administrative expenses totaled $241,445 and
$577,399, respectively, for the three and six months ended June 30, 1997
compared to $402,021 and $807,124, respectively, for the similar 1996 periods.
Management fees paid by the Venture and attributable to the Partnership totaled
$89,638 and $185,995, respectively, for the three and six months ended June 30,
1997 compared to $122,498 and $240,961, respectively, for the similar 1996
periods. Reimbursements for overhead and administrative expenses attributable to
the Partnership totaled $96,023 and $229,632, respectively, for the three and
six months ended June 30, 1997 compared to $159,884 and $320,993, respectively,
for the similar 1996 periods.
7
<PAGE>
JONES CABLE INCOME FUND 1-B, LTD.
---------------------------------
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
---------------------------------------------------------------
RESULTS OF OPERATIONS
---------------------
FINANCIAL CONDITION
- -------------------
It is the General Partner's publicly announced policy that it intends to
liquidate its managed partnerships, including the Partnership, as opportunities
for sales of partnership cable television systems arise in the marketplace over
the next several years. In accordance with the General Partner's policy, the
Partnership sold the Orangeburg System in February 1996 and the Venture sold the
Colorado Systems in January 1997. No specific dates or terms have yet been set
for the sale of the Venture's remaining systems. There can be no assurance as to
the timing or terms of any sale.
The Partnership continues to own a 40 percent interest in the Venture. The
investment is accounted for under the equity method. When compared to the
December 31, 1996 balance, this investment has increased by $1,308,660. This
increase represents the Partnership's proportionate share of net income,
resulting from the sale of the Colorado Systems, partially offset by
distributions, during the first six months of 1997.
On January 24, 1997, the Venture sold the Colorado Systems to an
unaffiliated party for a sales price of $35,000,000, subject to customary
closing adjustments. The Venture distributed a total of $15,000,000 to the
Partnership and Fund 1-C in February 1997, which amount represents the net sale
proceeds following the Venture's repayment of a portion of the balance
outstanding on its credit facility. The Partnership received $5,965,360 and
Fund 1-C received $9,034,640 of such distribution. The Partnership, in turn,
distributed the $5,965,360 (approximately $142 per each $1,000 invested in the
Partnership) to the limited partners of the Partnership. Because the
distribution to the limited partners of the Partnership together with all prior
distributions did not return the amount initially contributed by the limited
partners to the Partnership plus the preferred return provided by the
Partnership's limited partnership agreement, the General Partner did not receive
a distribution from the sale proceeds. The Jones Group, Ltd., a subsidiary of
Intercable, received a brokerage fee from the Venture of $875,000, representing
2.5 percent of the sales price, for acting as a broker in this transaction.
Because the sale of the Colorado Systems did not represent a sale of all or
substantially all of the Partnership's assets, no vote of the limited partners
of the Partnership was required to approve this sale.
During the first six months of 1997, capital expenditures within the
Venture's systems totaled approximately $2,327,000. Approximately 47 percent of
these expenditures was for the construction of service drops to subscribers'
homes and approximately 20 percent of these expenditures was for the
construction of new cable plant. The remainder of these expenditures related to
various system enhancements and improvements in all of the Venture's systems.
Funding for these expenditures was provided by cash on hand, cash generated from
operations and borrowings available under the Venture's credit facility.
Anticipated capital expenditures for the remainder of 1997 are approximately
$1,885,000. Construction of service drops to homes will account for
approximately 28 percent of the anticipated expenditures and construction of new
cable plant will account for approximately 19 percent of the anticipated
expenditures. The remainder of the expenditures will relate to other various
enhancements in all of the Venture's remaining systems. Funding for these
expenditures is expected to come from cash on hand, cash generated from
operations and available borrowings under the Venture's credit facility.
As discussed above, on January 24, 1997, the Venture sold its Colorado
Systems and used the sales proceeds to repay a portion of its then outstanding
principal balance on its $45,000,000 credit facility. The credit facility was
amended in the second quarter of 1997 to reduce the maximum amount available to
$27,500,000. At June 30, 1997, the Venture's credit facility had $24,200,000
outstanding, leaving $3,300,000 available for future borrowings. On September
30, 2000, the maximum amount available begins to reduce quarterly until June 30,
2005 when the amount available will be zero. Interest on outstanding principal
is calculated at the Venture's option of the Base Rate plus 3/8 percent, or the
Euro-Rate plus 1-3/8 percent. The effective interest rates on amounts
outstanding as of June 30, 1997 and 1996 were 7.35 percent and 7.00 percent,
respectively.
One of the primary objectives of the Venture is to provide quarterly cash
distributions to the Venture partners, primarily from cash generated through
operating activities of the Venture. The Venture's partners in turn seek to
provide quarterly cash distributions to their partners. The Venture used cash
generated from operations to fund capital
8
<PAGE>
expenditures and did not declare a quarterly cash flow distribution during the
first or second quarter of 1997, although it did make a distribution of
$15,000,000 from the proceeds of the sale of the Colorado Systems during the
first quarter of 1997. The Venture does not anticipate resuming cash flow
distributions in the near future. Such distributions, if any, will be announced
on a quarter-by-quarter basis.
The General Partner believes that the Venture has sufficient sources of
capital available from cash on hand, cash generated from operations and from
borrowings available under its new credit facility to meet its anticipated
needs.
RESULTS OF OPERATIONS
- ---------------------
The Partnership -
- -----------------
On February 28, 1996, the Partnership sold the Orangeburg System, which was
the Partnership's only directly held system. The Partnership's continuing
operations are represented by its 40 percent interest in the Venture.
The Venture -
- -------------
Revenues of the Venture decreased $1,652,505, or approximately 27 percent,
to $4,507,844 for the three months ended June 30, 1997 from $6,160,349 for the
comparable 1996 period. Revenues decreased $2,764,203, or approximately 23
percent, to $9,353,542 for the six months ended June 30, 1997 from $12,117,745
for the comparable 1996 period. These decreases were a result of the sale of
the Colorado Systems. Disregarding the effect of the sale of the Colorado
Systems, revenues would have increased $226,892, or approximately 5 percent, and
$458,304, or approximately 5 percent, for the three and six month periods ended
June 30, 1997 and 1996, respectively. Basic service rate increases accounted
for approximately 69 percent and 71 percent of the increases in revenues for the
three and six month periods ended June 30, 1997. An increase in the number of
basic service subscribers accounted for approximately 13 percent and 14 percent
of the increases in revenues for the three and six month periods ended June 30,
1997. The number of basic service subscribers in the remaining systems totaled
47,671 at June 30, 1997 compared to 47,209 at June 30, 1996, an increase of 462,
or approximately 1 percent. No other single factor significantly affected these
increases in revenues.
Operating expenses consist primarily of costs associated with the operation
and administration of the Venture's cable television systems. The principal
cost components are salaries paid to system personnel, programming expenses,
professional fees, subscriber billing costs, rent for leased facilities, cable
system maintenance expenses and marketing expenses.
Operating expenses decreased $883,296, or approximately 26 percent, to
$2,497,384 for the three months ended June 30, 1997 from $3,380,680 for the
comparable 1996 period. Operating expenses decreased $1,290,459, or
approximately 19 percent, to $5,466,347 for the six months ended June 30, 1997
from $6,756,806 for the comparable 1996 period. These decreases were a result
of the sale of the Colorado Systems. Disregarding the effect of the sale of the
Colorado Systems, operating expenses would have increased $92,563, or
approximately 4 percent, and $158,435, or approximately 3 percent, for the three
and six month periods ended June 30, 1997 and 1996. These increases in
operating expenses for the three and six month periods were due primarily to
increases in programming fees. Operating expenses represented 54 percent of
revenues for the three and six month periods ended June 30, 1997 compared to 54
percent and 55 percent, respectively, for the similar periods in 1996. No other
individual factor was significant to these increases in operating expenses.
The cable television industry generally measures the financial performance
of a cable television system in terms of operating cash flow (revenues less
operating expenses). This measure is not intended to be a substitute or
improvement upon the items disclosed on the financial statements, rather it is
included because it is an industry standard. Operating cash flow decreased
$769,209, or approximately 28 percent, to $2,010,460 for the three months ended
June 30, 1997 from $2,779,669 for the comparable 1996 period. For the six month
periods ended June 30, 1997, operating cash flow decreased $1,473,744, or
approximately 27 percent, to $3,887,195 in 1997 from $5,360,939 in 1996. These
decreases were a result of the sale of the Colorado Systems. Disregarding the
effect of the sale of the Colorado Systems, operating cash flow would have
increased $134,329, or approximately 7 percent, and $299,869, or approximately 8
percent, for the three and six month periods ended June 30, 1997 and 1996.
These increases were due to the increases in revenues exceeding the increases in
operating expenses.
9
<PAGE>
Management fees and allocated overhead from the General Partner decreased
$243,201, or approximately 34 percent, to $466,837 for the three months ended
June 30, 1997 from $710,038 for the comparable 1996 period. Management fees and
allocated overhead from the General Partner decreased $367,935, or approximately
26 percent, to $1,045,076 for the six month period ended June 30, 1997 from
$1,413,011 for the comparable 1996 period. These decreases were as a result of
the sale of the Colorado Systems. Disregarding the effect of the sale of the
Colorado Systems, management fees and allocated overhead would have decreased
$52,759, or approximately 10 percent, and increased $8,104, or approximately 1
percent, for the three and six month periods ended June 30, 1997 and 1996.
These changes were primarily due to the change in revenues upon which such
management fees and allocations are based, and the change in expenses allocated
from the General Partner.
Depreciation and amortization expense decreased $862,947, or approximately
41 percent, to $1,217,187 for the three months ended June 30, 1997 from
$2,080,134 for the comparable 1996 period. Depreciation and amortization
expense decreased $1,465,115, or approximately 35 percent, to $2,719,331 for the
six months ended June 30, 1997 from $4,184,446 for the comparable 1996 period.
These decreases were a result of the sale of the Colorado Systems. Disregarding
the effect of the sale of the Colorado Systems, depreciation and amortization
expense would have decreased $219,199, or approximately 14 percent, and
$456,298, or approximately 15 percent, for the three and six month periods ended
June 30, 1997 and 1996. These decreases were due to the maturation of the
Venture's depreciable asset base.
The Venture's operating income increased $336,939 to $326,436 for the three
months ended June 30, 1997 compared to an operating loss of $10,503 for the
comparable 1996 period. The Venture's operating income increased $359,306 to
$122,788 for the six months ended June 30, 1997 compared to an operating loss of
$236,518 for the comparable 1996 period. Disregarding the effect of the sale of
the Colorado Systems, the Venture would have reported operating income of
$332,454 for the three months ended June 30, 1997 compared to an operating loss
of $73,833 for the comparable 1996 period, and $477,862 for the six months ended
June 30, 1997 compared to an operating loss of $270,201 for the comparable 1996
period. The change in operating income for the three month period ended June
30, 1997 compared to the similar 1996 period was a result of the increase in
revenues and decreases in depreciation and amortization expense and management
fees and allocated overhead from the General Partner exceeding the increase in
operating expenses. The change in operating income for the six month period
ended June 30, 1997 compared to the similar 1996 period was a result of the
increase in revenues and decrease in depreciation and amortization expense
exceeding the increase in operating expenses and management fees and allocated
overhead from the General Partner.
Interest expense decreased $433,161, or approximately 57 percent, to
$328,933 for the three months ended June 30, 1997 from $762,094 for the
comparable 1996 period. Interest expense decreased $849,121, or approximately
54 percent, to $710,376 for the six months ended June 30, 1997 from $1,559,497
for the comparable 1996 period. These decreases were primarily due to the lower
outstanding balances on the Venture's interest bearing obligations, as a result
of a portion of the proceeds from the sale of the Colorado Systems being used to
repay a portion of the outstanding loan principal balance.
The Venture reported a gain on the sale of the Colorado Systems of
$18,889,257 in the first six months of 1997. No similar gain was reported in
the first six months of 1996.
The Venture reported a net loss of $1,485 for the three months ended June
30, 1997 compared to a net loss of $759,486 for the similar 1996 period. This
change was due to the factors discussed above. The Venture reported net income
of $18,290,220 for the six months ended June 30, 1997 compared to a net loss of
$1,777,952 for the similar 1996 period. This change was primarily a result of
the gain on the sale of the Colorado Systems and other factors as discussed
above.
10
<PAGE>
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
a) Exhibits
27) Financial Data Schedule
b) Reports on Form 8-K
None
11
<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.
JONES CABLE INCOME FUND 1-B, LTD.
BY: JONES INTERCABLE, INC.
General Partner
By: /S/ Kevin P. Coyle
--------------------------------------
Kevin P. Coyle
Group Vice President/Finance
(Principal Financial Officer)
Dated: August 13, 1997
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
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