SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
/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
/ / 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: 0-16845
Fidelity Leasing Income Fund IV, L.P.
_______________________________________________________________________________
(Exact name of registrant as specified in its charter)
Delaware 23-2441780
_______________________________________________________________________________
(State of organization) (I.R.S. Employer Identification No.)
7 E. Skippack Pike, Suite 275, Ambler, Pennsylvania 19002
_______________________________________________________________________________
(Address of principal executive offices) (Zip code)
(215) 619-2800
_______________________________________________________________________________
(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 regis-
trant was required to file such reports), and (2) has been subject to such fil-
ing requirements for the past 90 days.
Yes __X__ No _____
Page 1 of 10
Part I: Financial Information
Item 1: Financial Statements
FIDELITY LEASING INCOME FUND IV, L.P.
BALANCE SHEETS
ASSETS
(Unaudited) (Audited)
March 31, December 31,
1996 1995
___________ ____________
Cash and cash equivalents $1,027,994 $ 789,629
Accounts receivable 49,301 77,274
Interest receivable 104 3,651
Due from related parties 6,395 24,545
Equipment under operating leases
(net of accumulated depreciation
of $6,076,606 and $6,994,681,
respectively) 1,648,208 1,888,844
Equipment held for sale or lease 2,931 2,972
__________ __________
Total assets $2,734,933 $2,786,915
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Lease rents paid in advance $ 110,332 $ 56,461
Accounts payable and
accrued expenses 40,356 73,251
Due to related parties 1,903 4,096
_________ __________
Total liabilities 152,591 133,808
Partners' capital 2,582,342 2,653,107
__________ __________
Total liabilities and
partners' capital $2,734,933 $2,786,915
========== ==========
The accompanying notes are an integral part of these financial statements.
2
FIDELITY LEASING INCOME FUND IV, L.P.
STATEMENTS OF OPERATIONS
For the three months ended March 31, 1996 and 1995
(Unaudited)
1996 1995
________ ________
Income:
Rentals $401,265 $585,019
Interest 8,297 31,617
Gain on sale of equipment, net 28,436 67,864
Other 369 11,860
________ ________
438,367 696,360
________ ________
Expenses:
Depreciation 194,390 370,057
Write-down of equipment to net realizable
value 39,108 -
General and administrative 32,915 15,633
General and administrative to related
party 17,195 13,536
Management fee to related party 23,572 34,597
________ ________
307,180 433,823
________ ________
Net income $131,187 $262,537
======== ========
Net income (loss) per equivalent
limited partnership unit $ (6.94) $ 19.06
======== ========
Weighted average number of
equivalent limited partnership
units outstanding during the period 10,812 13,480
======== ========
The accompanying notes are an integral part of these financial statements.
3
FIDELITY LEASING INCOME FUND IV, L.P.
STATEMENT OF PARTNERS' CAPITAL
For the three months ended March 31, 1996
(Unaudited)
General Limited Partners
Partner Units Amount Total
_______ _____ ______ _____
Balance, January 1, 1996 $ 6,879 40,786 $2,646,228 $2,653,107
Redemptions - (604) (33,952) (33,952)
Cash distributions (5,880) - (162,120) (168,000)
Net income (loss) 206,249 - (75,062) 131,187
________ ______ __________ __________
Balance, March 31, 1996 $207,248 40,182 $2,375,094 $2,582,342
======== ====== ========== ==========
The accompanying notes are an integral part of these financial statements.
4
FIDELITY LEASING INCOME FUND IV, L.P.
STATEMENTS OF CASH FLOWS
For the three months ended March 31, 1996 and 1995
(Unaudited)
1996 1995
__________ __________
Cash flows from operating activities:
Net income $ 131,187 $ 262,537
__________ __________
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation 194,390 370,057
Write-down of equipment to net realizable
value 39,108 -
Gain on sale of equipment, net (28,436) (67,864)
(Increase) decrease in accounts receivable 27,973 (52,784)
(Increase) decrease in due from related parties 18,150 11,285
Increase (decrease) in lease rents paid
in advance 53,871 (24,170)
Increase (decrease) in accounts payable and
accrued expenses (32,895) (27,901)
Increase (decrease) in due to related parties (2,193) 36,319
Increase (decrease) in other, net 3,547 7,557
__________ __________
273,515 252,499
__________ __________
Net cash provided by operating activities 404,702 515,036
__________ __________
Cash flows from investing activities:
Acquisition of equipment - (1,301,621)
Proceeds from sale of equipment 35,615 78,685
__________ __________
Net cash provided by
(used in) investing activities 35,615 (1,222,936)
__________ __________
Cash flows from financing activities:
Distributions (168,000) (563,578)
Redemptions of capital (33,952) (15,882)
__________ __________
Net cash used in financing activities (201,952) (579,460)
__________ __________
Increase (decrease) in cash and cash
equivalents 238,365 (1,287,360)
Cash and cash equivalents, beginning
of period 789,629 2,456,685
__________ __________
Cash and cash equivalents, end of period $1,027,994 $1,169,325
========== ==========
The accompanying notes are an integral part of these financial statements.
5
FIDELITY LEASING INCOME FUND IV, L.P.
NOTES TO FINANCIAL STATEMENTS
March 31, 1996
(Unaudited)
The accompanying unaudited condensed financial statements have been prepared
by the Fund in accordance with generally accepted accounting principles,
pursuant to the rules and regulations of the Securities and Exchange Commis-
sion. In the opinion of Management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included.
1. ORGANIZATION
In February 1996, the name of the General Partner was changed from Fidelity
Leasing Corporation to F.L. Partnership Management, Inc.
2. EQUIPMENT LEASED
Equipment on lease consists primarily of computer peripheral equipment
under operating leases. A majority of the equipment was manufactured by
IBM. The lessees have agreements with the manufacturer to provide main-
tenance for the leased equipment. The Fund's operating leases are for
initial lease terms of 15 to 60 months. Generally, operating leases will
not recover all of the undepreciated cost and related expenses of its
rental equipment during the initial lease terms and the Fund is prepared to
remarket the equipment in future years. Fund policy is to review quarterly
the expected economic life of its rental equipment in order to deter-
mine the recoverability of its undepreciated cost. Recent and anticipated
technological developments affecting computer equipment and competitive
factors in the marketplace are considered among other things, as part of
this review. In accordance with Generally Accepted Accounting Principles,
the Fund writes down its rental equipment to its estimated net realizable
value when the amounts are reasonably estimated and only recognizes gains
upon actual sale of its rental equipment. As a result, $39,108 and
$-0- was charged to write-down of equipment to net realizable value for
the three months ended March 31, 1996 and 1995, respectively. The General
Partner believes, after analyzing the current equipment portfolio, that
there are impending gains to be recognized upon the sale of certain of its
equipment in future years. Any future losses are dependent upon
unanticipated technological developments affecting the computer equipment
industry in subsequent years.
The future approximate minimum rentals to be received on noncancellable
operating leases as of March 31, 1996 are as follows:
Years Ending December 31 Minimum Rentals
________________________ _______________
1996 $ 971,000
1997 709,000
1998 89,000
__________
$1,769,000
==========
6
FIDELITY LEASING INCOME FUND IV, L.P.
NOTES TO FINANCIAL STATEMENTS (Continued)
3. RELATED PARTY TRANSACTIONS
The General Partner receives 6% or 3% of gross rental payments from equip-
ment under operating leases and full pay-out leases, respectively, for
administrative and management services performed on behalf of the Fund.
Full pay-out leases are noncancellable leases with terms in excess of 42
months and for which rental payments during the initial term are at least
sufficient to recover the purchase price of the equipment, including acqui-
sition fees.
Additionally, the General Partner and its affiliates are reimbursed by the
Fund for certain costs of services and materials used by or for the Fund
except those items covered by the above-mentioned fees. Following is a
summary of fees and costs of services and materials charged by the General
Partner or its affiliates during the three months ended March 31:
1996 1995
________ ________
Management fee $23,572 $34,597
Reimbursable costs 17,195 13,536
Amounts due from related parties at March 31, 1996 and December 31, 1995
represent monies due the Fund from the General Partner and/or other
affiliated funds for rentals and sales proceeds collected and not yet re-
mitted to the Fund.
Amounts due to related parties at March 31, 1996 and December 31, 1995
represent monies due to the General Partner for the fees and costs men-
tioned above, as well as, rentals and sales proceeds collected by the Fund
on behalf of other affiliated funds.
4. SUBSEQUENT EVENT
Cash Distribution:
The General Partner declared and paid a cash distribution of $336,249 in
May 1996 for the three months ended March 31, 1996, to all admitted
partners as of March 31, 1996.
7
FIDELITY LEASING INCOME FUND IV, L.P.
Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Fidelity Leasing Income Fund IV, L.P. had revenues of $438,367 and
$696,360 for the three months ended March 31, 1996 and 1995, respectively.
Rental income from the leasing of computer peripheral equipment accounted for
92% and 84% of total revenues for the first quarter of 1996 and 1995, respec-
tively. The decrease in revenues is primarily attributable to a decrease in
rental income. In 1996, rental income decreased by approximately $233,000
because of equipment which came off lease and was re-leased at lower rental
rates or sold. This decrease, however, was reduced by approximately $49,000
of rents generated from equipment purchases made since the first quarter of
1995. Additionally, the Fund recognized a net gain on sale of equipment of
$28,436 and $67,864 for the quarter ended March 31, 1996 and 1995,
respectively, which also accounted for the decrease in revenues in 1996.
Furthermore, interest income decreased in 1996 resulting from lower cash
balances available for investment which also contributed to the overall
decrease in revenues.
Expenses were $307,180 and $433,823 during the three months ended March 31,
1996 and 1995, respectively. Depreciation expense comprised 63% and 85% of
total expenses during the first quarter of 1996 and 1995, respectively. The
decrease in expenses between the first quarter of 1996 and 1995 is primarily
attributable to a decrease in depreciation expense because of equipment which
came off lease and was sold during these periods. The decrease in expenses was
reduced by an increase in write-down of equipment to net realizable value.
Based upon the review of the recoverability of the undepreciated cost of rental
equipment, $39,108 was charged to operations to write down equipment to its
estimated net realizable value for the three months ended March 31, 1996 as
compared to $-0- for the three months ended March 31, 1995. The General
Partner believes, after analyzing the current equipment portfolio, that there
are impending gains to be recognized upon the sale of certain of its equipment
in future years. Any future losses are dependent upon unanticipated
technological developments affecting the computer equipment industry in
subsequent years.
For the three months ended March 31, 1996 and 1995, the Fund's net income
was $131,187 and $262,537, respectively. The earnings (loss) per equivalent
limited partnership unit, after earnings allocated to the General Partner were
($6.94)and $19.06 based on a weighted average number of equivalent limited
partnership units outstanding of 10,812 and 13,480 for the quarter ended
March 31, 1996 and 1995, respectively.
The Fund generated funds from operations of $336,249 and $564,730, for the
purpose of determining cash available for distribution and distributed $336,249
and $561,230 to partners for the first quarter of 1996 and 1995, respectively.
ANALYSIS OF FINANCIAL CONDITION
The Fund continues to purchase computer equipment with cash available from
operations which was not distributed to partners in previous periods.
The cash position of the Fund is reviewed daily and cash is invested on a
short-term basis.
The Fund's cash from operations is expected to continue to be adequate to
cover all operating expenses and contingencies during the next twelve month
period.
8
Part II: Other Information
FIDELITY LEASING INCOME FUND IV, L.P.
March 31, 1996
Item 1. Legal Proceedings: Inapplicable.
Item 2. Changes in Securities: Inapplicable.
Item 3. Defaults Upon Senior Securities: Inapplicable.
Item 4. Submission of Matters to a Vote of Securities Holders: Inapplicable.
Item 5. Other Information: Inapplicable.
Item 6. Exhibits and Reports on Form 8-K:
a) Exhibits: None
b) Reports on Form 8-K: None
9
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the regis-
trant has duly caused this report to be signed on its behalf by the under-
signed, thereunto duly authorized.
FIDELITY LEASING INCOME FUND IV, L.P.
5-14-96 By: Freddie M. Kotek
_______ ___________________________
Date Freddie M. Kotek
President of
F.L. Partnership Management, Inc.
(Principal Operating Officer)
5-14-96 By: Marianne T. Schuster
_______ ___________________________
Date Marianne T. Schuster
Vice President of
F.L. Partnership Management, Inc.
(Principal Financial Officer)
10
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<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
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<SECURITIES> 0
<RECEIVABLES> 55,800
<ALLOWANCES> 0
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<CGS> 0
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<INCOME-TAX> 0
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