Page 1 of 13
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
X QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
- ----- ACT OF 1934
For the quarterly period ended September 30, 1995
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 0-16615
PHOENIX LEASING CASH DISTRIBUTION FUND III,
A CALIFORNIA LIMITED PARTNERSHIP
Registrant
California 68-0062480
State of Jurisdiction I.R.S. Employer Identification No.
2401 Kerner Boulevard, San Rafael, California 94901-5527
- --------------------------------------------------------------------------------
Address of Principal Executive Offices Zip Code
Registrant's telephone number, including area code: (415) 485-4500
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
preceding requirements for the past 90 days.
Yes X No
--- ---
<PAGE>
Page 2 of 13
<TABLE>
Part I. Financial Information
Item 1. Financial Statements
PHOENIX LEASING CASH DISTRIBUTION FUND III,
A CALIFORNIA LIMITED PARTNERSHIP AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(Amounts in Thousands Except for Unit Amounts)
(Unaudited)
<CAPTION>
September 30, December 31,
1995 1994
---- ----
ASSETS
<S> <C> <C>
Cash and cash equivalents $ 4,873 $ 4,636
Accounts receivable (net of allowance for losses on accounts receivable of $68
and $392 at September 30, 1995 and December 31, 1994, respectively) 358 910
Notes receivable (net of allowance for losses on notes receivable of $4,347 and
$8,357 at September 30, 1995 and December 31, 1994, respectively) 14,096 13,668
Equipment on operating leases and held for lease (net of accumulated depreciation
of $20,739 and $38,267 at September 30, 1995 and December 31, 1994, respectively) 160 959
Net investment in financing leases (net of allowance for early terminations of $126 and
$129 at September 30, 1995 and December 31, 1994, respectively) 219 971
Cable systems, property and equipment (net of accumulated depreciation of $509 and
$394 at September 30, 1995 and December 31, 1994, respectively) 1,485 1,555
Investment in joint ventures 996 951
Capitalized acquisition fees (net of accumulated amortization of $7,951 and $7,661
at September 30, 1995 and December 31, 1994, respectively) 325 615
Other assets 8 57
-------- --------
Total Assets $ 22,520 $ 24,322
======== ========
LIABILITIES AND PARTNERS' CAPITAL
Liabilities
Accounts payable and accrued expenses $ 4,040 $ 4,513
Notes payable 2,000 --
Minority interest in subsidiary 305 311
-------- --------
Total Liabilities 6,345 4,824
-------- --------
Partners' Capital
General Partner (85) (109)
Limited Partners, 600,000 units authorized, 528,151 units issued and
516,716 units outstanding at September 30, 1995 and December 31, 1994 16,260 19,607
-------- --------
Total Partners' Capital 16,175 19,498
-------- --------
Total Liabilities and Partners' Capital $ 22,520 $ 24,322
======== ========
The accompanying notes are an integral
part of these statements.
</TABLE>
<PAGE>
Page 3 of 13
<TABLE>
PHOENIX LEASING CASH DISTRIBUTION FUND III,
A CALIFORNIA LIMITED PARTNERSHIP AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in Thousands Except for Per Unit Amounts)
(Unaudited)
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
---- ---- ---- ----
<S> <C> <C> <C> <C>
INCOME
Rental income $ 384 $ 1,014 $ 1,422 $ 3,712
Gain on sale of equipment 85 358 235 779
Interest income, notes receivable 71 174 773 969
Cable subscriber revenue 166 -- 509 --
Equity in earnings (losses) from
joint ventures 75 (20) 204 29
Other income 153 53 393 294
------- ------- ------- -------
Total Income 934 1,579 3,536 5,783
------- ------- ------- -------
EXPENSES
Depreciation and amortization 228 733 971 2,898
Lease related operating expenses 64 181 214 714
Program service, cable system 48 -- 135 --
Management fees to General Partner
and affiliate 68 52 418 270
Reimbursed administrative costs to
General Partner 70 97 240 290
Provision for losses on receivables 27 192 (1,819) 576
Legal expense 128 80 511 284
General and administrative expenses 104 62 373 273
------- ------- ------- -------
Total Expenses 737 1,397 1,043 5,305
------- ------- ------- -------
NET INCOME BEFORE MINORITY INTEREST 197 182 2,493 478
Minority interest in earnings of subsidiary (6) -- (18) --
------- ------- ------- -------
NET INCOME $ 191 $ 182 $ 2,475 $ 478
======= ======= ======= =======
NET INCOME PER LIMITED
PARTNERSHIP UNIT $ .36 $ -- $ 4.74 $ --
======= ======= ======= =======
DISTRIBUTIONS PER LIMITED
PARTNERSHIP UNIT $ 3.74 $ 3.74 $ 11.22 $ 11.22
======= ======= ======= =======
ALLOCATION OF NET INCOME:
General Partner $ 2 $ 182 $ 25 $ 478
Limited Partners 189 -- 2,450 --
------- ------- ------- -------
$ 191 $ 182 $ 2,475 $ 478
======= ======= ======= =======
The accompanying notes are an integral
part of these statements.
</TABLE>
<PAGE>
Page 4 of 13
PHOENIX LEASING CASH DISTRIBUTION FUND III,
A CALIFORNIA LIMITED PARTNERSHIP AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Amounts in Thousands)
(Unaudited)
Nine Months Ended
September 30,
1995 1994
---- ----
Operating Activities:
Net income $ 2,475 $ 478
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation and amortization 971 2,898
Gain on sale of equipment (235) (779)
Equity in earnings from joint ventures (204) (29)
Provision for losses on notes receivable (2,000) 576
Provision for losses on accounts receivable 181 --
Gain on sale of securities -- (154)
Decrease in accounts receivable 371 619
Decrease in accounts payable and
accrued expenses (473) (165)
Decrease in other assets 49 171
Minority interest in earnings of subsidiary 18 --
------- -------
Net cash provided by operating activities 1,153 3,615
------- -------
Investing Activities:
Principal payments, financing leases 661 1,370
Principal payments, notes receivable 7,567 406
Proceeds from sale of equipment 560 1,392
Proceeds from sale of securities -- 165
Distributions from joint ventures 310 255
Investment in financing leases -- (40)
Investment in notes receivables (6,146) --
Investment in joint ventures -- (107)
Cable systems, property and equipment (46) --
Investment in securities -- (11)
Payment of acquisition fees -- (5)
------- -------
Net cash provided by investing activities 2,906 3,425
------- -------
Financing Activities:
Proceeds from notes payable 2,000 --
Payments of principal, notes payable -- (1,479)
Distributions to partners (5,798) (5,797)
Distributions to minority partners (24) --
------- -------
Net cash used by financing activities (3,822) (7,276)
------- -------
Increase (decrease) in cash and cash equivalents 237 (236)
Cash and cash equivalents, beginning of period 4,636 4,767
------- -------
Cash and cash equivalents, end of period $ 4,873 $ 4,531
======= =======
Supplemental Cash Flow Information:
Cash paid for interest expense $ -- $ 19
The accompanying notes are an integral
part of these statements.
<PAGE>
Page 5 of 13
PHOENIX LEASING CASH DISTRIBUTION FUND III,
A CALIFORNIA LIMITED PARTNERSHIP AND SUBSIDIARY
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)
Note 1. General.
The accompanying unaudited condensed financial statements have been
prepared by the Partnership in accordance with generally accepted accounting
principles, pursuant to the rules and regulations of the Securities and Exchange
Commission. In the opinion of Management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included. Although management believes that the disclosures are adequate to make
the information presented not misleading, it is suggested that these condensed
financial statements be read in conjunction with the financial statements and
the notes included in the Partnership's Financial Statement, as filed with the
SEC in the latest annual report on Form 10-K.
Financial Accounting Pronouncements. In March 1995, the Financial
Accounting Standards Board issued Statement of Financial Accounting Standard No.
121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed of," which requires that long-lived assets and certain
identifiable intangibles to be held and used by an entity be reviewed for
impairment whenever events or changes in circumstances indicate that the
carrying amount of an asset may not be recoverable. In performing the review for
recoverability, the entity would estimate the future cash flows expected to
result from the use of the asset and its eventual disposition. If the sum of the
expected future cash flows (undiscounted and without interest charges) is less
than the carrying amount of the asset, an impairment loss is recognized.
Measurement of an impairment loss for long-lived assets and identifiable
intangibles that an entity expects to hold and use should be based on the fair
value of the asset. Statement No. 121 is effective for financial statements for
fiscal years beginning after December 15, 1995. The Partnership does not expect
the adoption of this statement to have a material impact on its financial
position and results of operations. The Partnership plans to adopt Statement No.
121 on January 1, 1996.
Note 2. Summary of Significant Accounting Policies.
Principles of consolidation. The 1995 financial statements include the
accounts of the Partnership and its majority owned subsidiary, Phoenix Black
Rock Cable J.V. All significant intercompany accounts and transactions have been
eliminated in consolidation.
On December 31, 1994, the Partnership determined that the financial
position of Phoenix Black Rock Cable J.V. had become material to the operations
of the Partnership. Accordingly, the Partnership consolidated the financial
results of this joint venture with those of the Partnership at December 31,
1994. The Partnership has reported this joint venture using the equity method of
accounting for the first three quarters of 1994. The effect of this change has
no impact on the net income or equity of the Partnership.
Non-Cash Investing Activity. On September 20, 1995, the Partnership
foreclosed upon a nonperforming outstanding note receivable to a cable
television system operator to whom the Partnership, along with other affiliated
partnerships managed by the General Partner, had extended credit. The
partnerships' notes receivables were exchanged for interests (their capital
contribution), on a pro rata basis, in a newly formed joint venture owned by the
partnerships and managed by the General Partner. The amount of the outstanding
note receivable that was contributed to the joint venture was $151,000.
<PAGE>
Page 6 of 13
Note 3. Reclassification.
Reclassification - Certain 1994 amounts have been reclassified to
conform to the 1995 presentation.
Note 4. Income Taxes.
Federal and state income tax regulations provide that taxes on the
income or loss of the Partnership are reportable by the partners in their
individual income tax returns. Accordingly, no provision for such taxes has been
made in the accompanying financial statements.
Note 5. Notes Receivable.
Impaired Notes Receivable. On January 1, 1995, the Partnership adopted
Financial Accounting Standards Board Statement No. 114, "Accounting by Creditors
for Impairment of a Loan," and Statement No. 118, "Accounting by Creditors for
Impairment of a Loan - Income Recognition and Disclosures." Statement No. 114
requires that certain impaired loans be measured based on the present value of
expected cash flows discounted at the loan's effective interest rate; or,
alternatively, at the loan's observable market price or the fair value of the
collateral if the loan is collateral dependent. Prior to 1995, the allowance for
losses on notes receivable was based on the undiscounted cash flows or the fair
value of the collateral for collateral dependent loans.
In accordance with Statement No. 114, a loan is classified as
in-substance foreclosure when the Company has taken possession of the collateral
regardless of whether formal foreclosure proceedings take place. Notes
receivable previously classified as in-substance foreclosed cable systems but
for which the Company had not taken possession of the collateral have been
reclassified to notes receivable.
At September 30, 1995, the recorded investment in notes that are
considered to be impaired under Statement 114 was $17,377,000. Included in this
amount is $10,988,000 of impaired notes for which the related allowance for
losses is $3,144,000 and $6,389,000 of impaired notes for which there is no
allowance. The average recorded investment in impaired loans during the nine
months ended September 30, 1995 was approximately $16,604,000. Generally, notes
receivable are classified as impaired and the accrual of interest on such notes
is discontinued when the contractual payment of principal or interest has become
90 days past due or management has serious doubts about further collectibility
of the contractual payments. Any payments received subsequent to the placement
of the note receivable on to impaired status will generally be applied towards
the reduction of the outstanding note receivable balance, which may include
previously accrued interest as well as principal. Once the principal and accrued
interest balance has been reduced to zero, the remaining payments will be
applied to interest income.
During the quarter ended June 30, 1995, the Partnership received a
settlement on one of its notes receivable from a cable television system
operator which was considered to be impaired under Statement No. 114. The
Partnership received a partial recovery of $2,714,000 as a settlement which was
applied towards the $4,562,000 outstanding note receivable balance. The
remaining balance of $1,848,000 was written-off through its related allowance
for loan losses. The related allowance for loan losses for this note receivable
was provided for in a previous year in an amount equal to the carrying value of
the note.
The Partnership received settlements from two other impaired notes
receivable and foreclosed upon the assets of another note receivable to a cable
television system operator during the nine months ended September 30, 1995.
<PAGE>
Page 7 of 13
Upon receipt of the settlements and payoffs of the above mentioned
notes receivable, the Partnership reduced the allowance for loan losses by
$2,000,000 during the quarter ended June 30, 1995. This reduction in the
allowance for loan losses was recognized as income during the period.
The activity in the allowance for losses on notes receivable during the
nine months ended September 30, is as follows:
1995 1994
---- ----
(Amounts in Thousands)
Beginning balance $ 8,357 $ 7,781
Provision for losses (2,000) 576
Write downs (2,010) --
------- -------
Ending balance $ 4,347 $ 8,357
======= =======
Note 6. Net Income (Loss) and Distributions Per Limited Partnership Unit.
Net income and distributions per limited partnership unit were based on
the limited partners' share of net income and distributions, and the weighted
average number of units outstanding of 516,716 for the nine months ended
September 30, 1995 and 1994. For purposes of allocating net income (loss) and
distributions to each individual limited partner, the Partnership allocates net
income (loss) and distributions based upon each respective limited partner's net
capital contributions.
Note 7. Investment in Joint Ventures.
Equipment Joint Ventures
The aggregate combined statements of operations of the equipment joint
ventures is presented below:
COMBINED STATEMENTS OF OPERATIONS
(Amounts in Thousands)
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
---- ---- ---- ----
INCOME
Rental income $1,013 $ 408 $2,968 $ 1,728
Gain on sale of equipment 359 199 1,164 871
Other income 569 1 674 1
------ ----- ------ -------
Total income 1,941 608 4,806 2,600
------ ----- ------ -------
EXPENSES
Depreciation 628 280 1,086 910
Lease related operating expenses 726 454 2,142 1,738
Management fees to General Partner 94 33 221 141
General and administrative expenses 1 16 8 53
------ ----- ------ -------
Total expenses 1,449 783 3,457 2,842
------ ----- ------ -------
Net income (loss) $ 492 $(175) $1,349 $ (242)
====== ===== ====== =======
<PAGE>
Page 8 of 13
Foreclosed Cable Systems Joint Ventures
The aggregate combined statements of operations of the foreclosed cable
systems joint ventures is presented below:
COMBINED STATEMENTS OF OPERATIONS
(Amounts in Thousands)
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
---- ---- ---- ----
INCOME
Subscriber revenue $ 267 $321 $ 794 $856
Other income 3 3 9 9
----- ---- ----- ----
Total income 270 324 803 865
----- ---- ----- ----
EXPENSES
Depreciation and amortization 77 65 237 194
Program services 89 70 247 210
Management fees to an affiliate of the
General Partner 12 15 36 38
General and administrative expenses 79 78 228 211
Provision for losses on accounts
receivable 3 3 8 9
----- ---- ----- ----
Total expenses 260 231 756 662
----- ---- ----- ----
Net income before income taxes 10 93 47 203
Income tax expense (6) -- (13) --
----- ---- ----- ----
Net income $ 4 $ 93 $ 34 $203
===== ==== ===== ====
Note 8. Notes Payable.
On September 21, 1995 the Partnership received proceeds from notes
payable of $2,000,000. This loan is collateralized by the assets of the
Partnership and is payable in 30 monthly installments of principal and interest.
The interest rate is tied to the lender's prime rate and was 8.75% at September
30, 1995. The loan agreement contains certain restrictions on distributions made
to partners and requires pre-payment of the outstanding debt upon the sale of
certain significant assets of the Partnership.
<PAGE>
Page 9 of 13
PHOENIX LEASING CASH DISTRIBUTION FUND III,
A CALIFORNIA LIMITED PARTNERSHIP AND SUBSIDIARY
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Results of Operations
Phoenix Leasing Cash Distribution Fund III, a California limited
partnership and Subsidiary (the Partnership) reported net income of $191,000 and
$2,475,000 for the three and nine months ended September 30, 1995, respectively,
as compared to net income of $182,000 and $478,000 for the same periods in 1994.
The Partnership reported a very small increase in net income of $9,000 during
the three months ended September 30, 1995, as compared to the same period in
1994. The $1,997,000 increase in net income during the nine months ended
September 30, 1995, as compared to the same period in 1994, is primarily
attributable to the recognition, as income, of a portion of the allowance for
loan losses.
During the nine months ended September 30, 1995, the Partnership
received a settlement payment of $2.7 million on a defaulted note receivable
from a cable television system operator. The Partnership had provided a loan
loss reserve in an amount equal to the net carrying value of this note in a
prior year. Upon recovery of a portion of this defaulted note receivable, the
Partnership reduced the allowance for loan losses by $2 million during the
quarter ended September 30, 1995. This reduction in the allowance for loan
losses was recognized as income during the period.
Total revenues decreased by $645,000 and $2,247,000 during the three
and nine months ended September 30, 1995, respectively, when compared to the
same periods in 1994. The decrease is primarily the result of decreases in
rental income and a decreased gain on the sale of equipment. Rental income
declined by $630,000 and $2,290,000 for these periods, respectively, primarily
as the result of a decrease in the amount of equipment owned. At September 30,
1995, the Partnership owned equipment, excluding the Partnership's pro rata
interest in joint ventures, with an aggregate original cost of $27.1 million, as
compared to $55.6 million at September 30, 1994.
The Partnership reported a gain on the sale of equipment of $85,000 and
$235,000 for the three and nine months ended September 30, 1995, respectively,
as compared to a gain on sale of equipment of $358,000 and $779,000 during the
same periods in 1994. The decreased gain on sale of equipment for the three and
nine months ended September 30, 1995, when compared to the same periods in 1994,
are attributable to a decrease in the sales proceeds received on the sales of
such equipment. During the nine months ended September 30, 1995, the Partnership
sold equipment with an aggregate original cost of $21.5 million as compared to
$19.7 million during the same period in 1994.
During the nine months ended September 30, 1995, the Partnership
received a final payoff on four notes receivable, of which three were considered
impaired, and foreclosed upon the assets of another note receivable from a cable
television system operator. The Partnership recognized interest income from the
receipt of the final payoff on certain of these notes receivable. The
Partnership holds notes receivable from cable television system operators and
security monitoring companies with a net carrying value of approximately $18.4
million, of which $17.4 are considered to be impaired at September 30, 1995. The
Partnership has suspended the accrual of interest on these impaired notes and
has provided an allowance for loan losses. The General Partner is currently
working with the borrowers, other creditors and the bankruptcy court in order to
seek remedies that will maximize the recovery of the Partnership's investment in
these notes.
<PAGE>
Page 10 of 13
Total expenses decreased by $660,000 and $4,262,000 for the three and
nine months ended September 30, 1995, respectively, as compared to the same
periods in 1994. The decrease in total expenses for these periods is primarily
due to the decrease in depreciation and amortization expense of $505,000 and
$1,927,000, respectively, as compared to the same periods in the prior year. The
decrease in depreciation and amortization is due to a decrease in depreciation
for the three and nine months ended September 30, 1995, a result of the
reduction in the amount of equipment owned by the Partnership. Additionally, an
increasing portion of the equipment owned by the Partnership has been fully
depreciated.
Lease related operating expenses decreased by $117,000 and $500,000
during the three and nine months ended September 30, 1995, respectively,
compared to the same periods in 1994, primarily due to a decrease in remarketing
and administrative expenses charged to the Partnership on its reproduction
equipment that is leased pursuant to a vendor lease agreement. This decrease is
reflective of the decrease in the amount of reproduction equipment owned by the
Partnership and a corresponding decrease in the rental revenues received from
such equipment.
The Partnership reported cable subscriber revenues of $166,000 and
$509,000 during the three and nine months ended September 30, 1995,
respectively, as compared to $0 during the same periods in 1994. On December 31,
1994, the Partnership determined that the financial position of this cable
television system had become material to the operations of the Partnership.
Accordingly, the financial statements for the Partnership for the three and nine
months ended September 30, 1995 have been consolidated. However, for the three
and nine months ended September 30, 1994, this cable television system
subsidiary was reflected as an investment in a foreclosed cable system joint
venture on the balance sheet and the net earnings were reported as equity in
earnings from foreclosed cable system joint ventures.
The Partnership has also foreclosed upon the collateral of several
notes receivable to certain cable television system operators. As a result, the
Partnership has an ownership interest in the operating cable television systems
organized as joint ventures. The Partnership's equity interest in the earnings
(losses) from the foreclosed cable system joint ventures was minimal during 1995
and 1994.
Liquidity and Capital Resources
The Partnership's primary source of liquidity comes from its
contractual obligations with lessees and borrowers for fixed payment terms. As
the initial lease terms of the leases expire, the Partnership will continue to
renew, remarket or sell the equipment. The future liquidity of the Partnership
will depend upon the General Partner's success in collecting contractual amounts
and re-leasing and selling the Partnership's equipment as it comes off lease. As
another source of liquidity, the Partnership has investments in foreclosed cable
systems and investments in joint ventures.
The net cash generated by operating activities decreased by $3,171,000
during the nine months ended September 30, 1995, when compared to the same
period in 1994. This decrease is primarily due to a decrease in rental income, a
result of the decrease in the size of the equipment portfolio.
Principal payments from notes receivable increased substantially by
$7,161,000 during the nine months ended September 30, 1995, when compared to the
same period in 1994. During the nine months ended September 30, 1995, the
Partnership received final payoffs of notes receivable from four cable
television system operators.
<PAGE>
Page 11 of 13
During the third quarter of 1995, the Partnership invested an
additional $6,146,000 in a note receivable from a cable television system
operator. The Partnership had previously extended credit of approximately $2.9
million of subordinated debt to this cable television system operator. This
cable television system operator is in default on its outstanding debt. The
current funding of $6 million was paid to the senior lendor and the Partnership
has now assumed a first and second secured position in the assets of the cable
television system. The General Partner believes that it is now in a better
position to negotiate a settlement or foreclosure with the borrower in order to
maximize the Partnership's recovery of its investment.
The decrease in proceeds from the sale of equipment of $832,000 during
the nine months ended September 30, 1995, as compared to the same period in the
prior year, is attributable to a decrease in the value of the equipment sold.
During the nine months ended September 30, 1995, the Partnership sold equipment
having an aggregate original cost of $21.5 million, as compared to $19.7 million
of equipment sold during the same period in 1994.
During the nine months ended September 30, 1995, the Partnership
reported an overall increase in cash distributions received from its joint
ventures. The overall increase in distributions reflects an increase in
distributions from equipment joint ventures and a decrease in distributions from
foreclosed cable system joint ventures during the nine months ended September
30, 1995. During the first quarter of 1994, the Partnership received its first
cash distributions from its investment in foreclosed cable systems joint
ventures. The increased cash distribution for 1994 was attributable to the sale
of two cable systems and the distribution of excess cash from operations in one
other remaining cable system. The increased distributions from the equipment
joint venture during the nine months ended September 30, 1995 is related to
distributions received from a joint venture that was formed in October of 1994.
As of September 30, 1995, the Partnership owned equipment held for
lease with an aggregate original cost of $7,770,000 and a net book value of
$48,000, compared to $19,188,000 and $305,000, respectively, as of September 30,
1994. The General Partner is actively engaged, on behalf of the Partnership, in
remarketing and selling the Partnership's off-lease portfolio.
The cash distributed to limited partners during the nine months ended
September 30, 1995 and 1994 was $5,798,000 and $5,797,000, respectively. As a
result, the cumulative cash distributions to the limited partners are
$94,272,000 and $86,521,000 as of September 30, 1995 and 1994, respectively. The
General Partner did not receive cash distributions during the nine months ended
September 30, 1995 and 1994. The General Partner has elected not to receive
payment, at this time, for its share of the cash available for distribution due
to its negative capital account.
The Partnership's asset portfolio continues to decline as a result of
the ongoing liquidation of assets, and therefore it is expected that the cash
generated from Partnership leasing operations will also decline. As the cash
generated by operations continues to decline, the rate of cash distributions
made to limited partners will also decline. It is anticipated that the
distributions to partners on October 15, 1995 and January 15, 1996 will be made
at approximately the same rate as the current distributions being made during
the nine months ended September 30, 1995. However, after the January 15, 1996
distribution the Partnership will switch to annual distributions with the first
annual distribution expected to be made on January 15, 1997.
Cash generated from leasing and financing operations has been and is
anticipated to continue to be sufficient to meet the Partnership's continuing
operational expenses and to provide for distributions to partners.
<PAGE>
Page 12 of 13
PHOENIX LEASING CASH DISTRIBUTION FUND III,
A CALIFORNIA LIMITED PARTNERSHIP
September 30, 1995
Part II. Other Information.
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 8-K:
a) Exhibits:
(27) Financial Data Schedule
b) Reports on 8-K: None
<PAGE>
Page 13 of 13
<TABLE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
PHOENIX LEASING CASH DISTRIBUTION FUND III,
A CALIFORNIA LIMITED PARTNERSHIP
(Registrant)
<CAPTION>
Date Title Signature
<S> <C> <C>
November 13, 1995 /S/ PARITOSH K. CHOKSI
- ----------------- Chief Financial Officer, ----------------------
Senior Vice President (Paritosh K. Choksi)
and Treasurer of
Phoenix Leasing Incorporated
General Partner
November 13, 1995 /S/ BRYANT J. TONG
- ----------------- Senior Vice President, ------------------
Financial Operations (Bryant J. Tong)
(Principal Accounting Officer)
and a Director of
Phoenix Leasing Incorporated
General Partner
November 13, 1995 /S/ GARY W. MARTINEZ
- ----------------- Senior Vice President of --------------------
Phoenix Leasing Incorporated (Gary W. Martinez)
General Partner
November 13, 1995 /S/ MICHAEL K. ULYATT
- ----------------- Partnership Controller ---------------------
Phoenix Leasing Incorporated (Michael K. Ulyatt)
General Partner
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> SEP-30-1995
<CASH> 4,873
<SECURITIES> 0
<RECEIVABLES> 18,869
<ALLOWANCES> 4,415
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 22,893
<DEPRECIATION> 21,248
<TOTAL-ASSETS> 22,520
<CURRENT-LIABILITIES> 0
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 16,175
<TOTAL-LIABILITY-AND-EQUITY> 22,520
<SALES> 0
<TOTAL-REVENUES> 3,536
<CGS> 0
<TOTAL-COSTS> 1,043
<OTHER-EXPENSES> 0
<LOSS-PROVISION> (1,819)
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 2,493
<INCOME-TAX> 0
<INCOME-CONTINUING> 2,475
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 2,475
<EPS-PRIMARY> 4.74
<EPS-DILUTED> 0
</TABLE>
