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, 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: 0-16845
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,
1997 1996
___________ ____________
Cash and cash equivalents $ 918,792 $ 915,772
Accounts receivable 48,884 45,765
Due from related parties 24,452 30,068
Equipment under operating leases
(net of accumulated depreciation
of $5,248,469 and $5,034,585,
respectively) 1,409,344 1,397,793
__________ __________
Total assets $2,401,472 $2,389,398
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Lease rents paid in advance $ 91,475 $ 90,732
Accounts payable and
accrued expenses 13,296 9,891
Due to related parties 3,843 8,950
__________ __________
Total liabilities 108,614 109,573
Partners' capital 2,292,858 2,279,825
__________ __________
Total liabilities and
partners' capital $2,401,472 $2,389,398
========== ==========
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, 1997 and 1996
(Unaudited)
1997 1996
________ ________
Income:
Rentals $358,175 $401,265
Interest 12,157 8,297
Gain on sale of equipment, net 610 28,436
Other 730 369
________ ________
371,672 438,367
________ ________
Expenses:
Depreciation 213,885 194,390
Write-down of equipment to net realizable
value - 39,108
General and administrative 9,801 31,312
General and administrative to related
party 13,966 18,798
Management fee to related party 20,987 23,572
________ ________
258,639 307,180
________ ________
Net income $113,033 $131,187
======== ========
Net income (loss) per equivalent
limited partnership unit $ 10.83 $ (6.94)
======== ========
Weighted average number of
equivalent limited partnership
units outstanding during the period 10,117 10,812
======== ========
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, 1997
(Unaudited)
General Limited Partners
Partner Units Amount Total
_______ _____ ______ _____
Balance, January 1, 1997 $4,499 41,379 $2,275,326 $2,279,825
Cash distributions (3,500) - (96,500) (100,000)
Net income 3,500 - 109,533 113,033
______ ______ __________ __________
Balance, March 31, 1997 $4,499 41,379 $2,288,359 $2,292,858
====== ====== ========== ==========
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, 1997 and 1996
(Unaudited)
1997 1996
__________ __________
Cash flows from operating activities:
Net income $113,033 $ 131,187
________ __________
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation 213,885 194,390
Write-down of equipment to net realizable
value - 39,108
Gain on sale of equipment, net (610) (28,436)
(Increase) decrease in accounts receivable (3,119) 27,973
(Increase) decrease in due from related parties 5,616 18,150
Increase (decrease) in lease rents paid
in advance 743 53,871
Increase (decrease) in accounts payable and
accrued expenses 3,405 (32,895)
Increase (decrease) in due to related parties (5,107) (2,193)
Increase (decrease) in other, net - 3,547
________ __________
214,813 273,515
________ __________
Net cash provided by operating activities 327,846 404,702
________ __________
Cash flows from investing activities:
Acquisition of equipment (225,436) -
Proceeds from sale of equipment 610 35,615
________ __________
Net cash provided by (used in)
investing activities (224,826) 35,615
________ __________
Cash flows from financing activities:
Distributions (100,000) (168,000)
Redemptions of capital - (33,952)
________ __________
Net cash used in financing activities (100,000) (201,952)
________ __________
Increase in cash and cash equivalents 3,020 238,365
Cash and cash equivalents, beginning
of period 915,772 789,629
________ __________
Cash and cash equivalents, end of period $918,792 $1,027,994
======== ==========
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, 1997
(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. Certain amounts on the 1996 financial statements have been
reclassified to conform to the presentation in 1997.
1. EQUIPMENT LEASED
Equipment on lease consists primarily of computer equipment under operating
leases. A majority of the equipment was manufactured by IBM. The lessees
have agreements with the manufacturer to provide maintenance for the leased
equipment. The Fund's operating leases are for initial lease terms of 15
to 60 months. 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. There was no charge to write-
down of equipment to net realizable for the first quarter of 1997. For the
three months ended March 31, 1996, $39,108 was charged to write-down of
equipment to net realizable value.
The future approximate minimum rentals to be received on noncancellable
operating leases as of March 31, 1997 are as follows:
Years Ending December 31 Minimum Rentals
________________________ _______________
1997 $ 718,000
1998 426,000
1999 199,000
__________
$1,343,000
==========
2. RELATED PARTY TRANSACTIONS
The General Partner receives 6% or 3% of rental payments from equipment
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.
6
FIDELITY LEASING INCOME FUND IV, L.P.
NOTES TO FINANCIAL STATEMENTS (Continued)
2. RELATED PARTY TRANSACTIONS (Continued)
Additionally, the General Partner and its parent company 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 parent company during the three months ended
March 31:
1997 1996
________ ________
Management fee $20,987 $23,572
Reimbursable costs 13,966 18,798
The Fund maintains its checking and investment accounts in Jefferson Bank,
a subsidiary of JeffBanks, Inc., in which the Chairman of Resource America,
Inc. serves as a director.
Amounts due from related parties at March 31, 1997 and December 31, 1996
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, 1997 and December 31, 1996
represent monies due to the General Partner and/or its parent company for
the fees and costs mentioned above, as well as, rentals and sales proceeds
collected by the Fund on behalf of other affiliated funds.
3. CASH DISTRIBUTION
The General Partner declared and paid a cash distribution of $100,000 in
May 1997 for the three months ended March 31, 1997, to all admitted
partners as of March 31, 1997.
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 $371,672 and
$438,367 for the three months ended March 31, 1997 and 1996, respectively.
Rental income from the leasing of computer peripheral equipment accounted for
96% and 92% of total revenues for the first quarter of 1997 and 1996, respec-
tively. The decrease in revenues is primarily attributable to a decrease in
rental income. In 1997, rental income decreased by approximately $99,000
because of equipment which came off lease and was re-leased at lower rental
rates or sold. This decrease, however, was reduced by approximately $56,000
of rents generated from equipment purchases made since the first quarter of
1996. Additionally, the Fund recognized a net gain on sale of equipment of
$610 and $28,436 for the quarter ended March 31, 1997 and 1996,
respectively, which also accounted for the decrease in revenues in 1997.
Expenses were $258,639 and $307,180 during the three months ended March 31,
1997 and 1996, respectively. Depreciation expense comprised 83% and 63% of
total expenses during the first quarter of 1997 and 1996, respectively. The
decrease in expenses between the first quarter of 1997 and 1996 is primarily
attributable to a decrease in write-down of equipment to net realizable value.
Based upon the review of the recoverability of the undepreciated cost of rental
equipment, there was no charge to operations to write down equipment to its
estimated net realizable value for the three months ended March 31, 1997.
However, $39,108 was charged to write-down of equipment to net realizable value
for the three months ended March 31, 1996. Any future losses are dependent
upon unanticipated technological developments affecting the computer equipment
industry in subsequent years. Additionally, the reduction in general and
administrative expenses incurred by the Fund in the first quarter of 1997 as
compared to the first quarter of 1996 also contributed to the decrease in
overall expenses. Depreciation expense increased in 1997 because of new
equipment purchases made since the first quarter of 1996, which lowered the
amount of decrease in total expenses in 1997.
For the three months ended March 31, 1997 and 1996, the Fund's net income
was $113,033 and $131,187, respectively. The earnings (loss) per equivalent
limited partnership unit, after earnings allocated to the General Partner were
$10.83 and ($6.94) based on a weighted average number of equivalent limited
partnership units outstanding of 10,117 and 10,812 for the quarter ended
March 31, 1997 and 1996, respectively.
The Fund generated funds from operations of $326,308 and $336,249, for the
purpose of determining cash available for distribution and distributed $100,000
and $336,249 to partners for the first quarter of 1997 and 1996, respectively.
For financial statement purposes, the Fund records cash distributions to
partners on a cash basis in the period in which they are paid.
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. During
the first quarter of 1997, the Fund purchased $225,436 of equipment subject to
an operating lease.
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, 1997
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.
5-14-97 By: Freddie M. Kotek
_______ ___________________________
Date Freddie M. Kotek
President of
F.L. Partnership Management, Inc.
(Principal Operating Officer)
5-14-97 By: Marianne T. Schuster
_______ ___________________________
Date Marianne T. Schuster
Vice President of
F.L. Partnership Management, Inc.
(Principal Financial Officer)
10
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<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 918,792
<SECURITIES> 0
<RECEIVABLES> 73,336
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 992,128
<PP&E> 6,657,813
<DEPRECIATION> 5,248,469
<TOTAL-ASSETS> 2,401,472
<CURRENT-LIABILITIES> 108,614
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 2,292,858
<TOTAL-LIABILITY-AND-EQUITY> 2,401,472
<SALES> 358,175
<TOTAL-REVENUES> 371,672
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 258,639
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 113,033
<INCOME-TAX> 0
<INCOME-CONTINUING> 113,033
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 113,033
<EPS-PRIMARY> 10.83
<EPS-DILUTED> 10.83
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