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 September 30, 1998
/ / 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: 0-17658
Fidelity Leasing Income Fund V, L.P.
_______________________________________________________________________________
(Exact name of registrant as specified in its charter)
Delaware 23-2496362
_______________________________________________________________________________
(State of organization) (I.R.S. Employer Identification)
3 North Columbus Boulevard, Philadelphia, PA 19106
_______________________________________________________________________________
(Address of principal executive offices) (Zip code)
(215) 574-1636
_______________________________________________________________________________
(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 12
Part I: Financial Information
Item 1: Financial Statements
FIDELITY LEASING INCOME FUND V, L.P.
BALANCE SHEETS
ASSETS
(Unaudited) (Audited)
September 30, December 31,
1998 1997
_____________ _____________
Cash and cash equivalents $ 850,469 $3,679,630
Accounts receivable 219,097 193,525
Due from related parties 21,888 158,700
Equipment under operating leases
(net of accumulated depreciation
of $6,255,721 and $7,078,588,
respectively) 3,593,712 3,423,328
Net investment in direct financing leases 2,460,543 -
Equipment held for sale or lease 10,590 182
__________ __________
Total assets $7,156,299 $7,455,365
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Lease rents paid in advance $ 258,573 $ 253,242
Accounts payable and
accrued expenses 81,399 109,888
Due to related parties 59,548 28,167
__________ __________
Total liabilities 399,520 391,297
Partners' capital 6,756,779 7,064,068
__________ __________
Total liabilities and
partners' capital $7,156,299 $7,455,365
========== ==========
The accompanying notes are an integral part of these financial statements.
2
FIDELITY LEASING INCOME FUND V, L.P.
STATEMENTS OF OPERATIONS
(Unaudited)
Three Months Ended Nine Months Ended
September 30 September 30
1998 1997 1998 1997
____ ____ ____ ____
Income:
Rentals $694,094 $ 938,700 $2,505,591 $2,448,862
Earned income on direct
financing leases 52,583 3,585 61,722 12,076
Interest 12,611 45,586 81,314 128,662
Gain on sale of equipment,
net 39,686 - 103,710 -
Other 4,081 3,473 8,203 11,220
________ __________ __________ __________
803,055 991,344 2,760,540 2,600,820
________ __________ __________ __________
Expenses:
Depreciation 601,432 496,075 2,037,288 1,605,198
Write-down of equipment to
net realizable value 109,926 - 214,926 60,868
General and administrative 55,504 20,102 110,621 64,789
General and administrative to
related party 43,791 32,170 138,065 116,499
Management fee to related
party 40,565 57,022 141,929 149,031
Loss on sale of equipment,
net - 188,564 - 210,264
________ __________ __________ __________
851,218 793,933 2,642,829 2,206,649
________ __________ __________ __________
Net income (loss) $(48,163) $ 197,411 $ 117,711 $ 394,171
======== ========== ========== ==========
Net income (loss) per equivalent
limited partnership unit $ (2.00) $ 7.82 $ 4.53 $ 15.60
======== ========== ========== ==========
Weighted average number of
equivalent limited partner-
ship units outstanding
during the period 24,696 24,978 25,077 24,986
======== ========== ========== ==========
The accompanying notes are an integral part of these financial statements.
3
FIDELITY LEASING INCOME FUND V, L.P.
STATEMENT OF PARTNERS' CAPITAL
For the nine months ended September 30, 1998
(Unaudited)
General Limited Partners
Partner Units Amount Total
_______ _____ ______ _____
Balance, January 1, 1998 $2,766 76,137 $7,061,302 $7,064,068
Cash distributions (4,250) - (420,750) (425,000)
Net income 4,000 - 113,711 117,711
______ ______ __________ __________
Balance, September 30, 1998 $2,516 76,137 $6,754,263 $6,756,779
====== ====== ========== ==========
The accompanying notes are an integral part of these financial statements.
4
FIDELITY LEASING INCOME FUND V, L.P.
STATEMENTS OF CASH FLOWS
For the nine months ended September 30, 1998 and 1997
(Unaudited)
1998 1997
____ ____
Cash flows from operating activities:
Net income $ 117,711 $ 394,171
__________ __________
Adjustments to reconcile net income
to net cash provided by
operating activities:
Depreciation 2,037,288 1,605,198
Write down of equipment to
net realizable value 214,926 60,868
Proceeds from direct financing leases,
net of earned income 95,032 57,914
(Gain) loss on sale of equipment, net (103,710) 210,264
(Increase) decrease in accounts receivable (25,572) 90,379
(Increase) decrease in due from
related parties 136,812 8,406
Increase (decrease) in lease rents paid
in advance 5,331 (79,749)
Increase (decrease) in accounts payable -
equipment - (19,800)
Increase (decrease) in accounts payable and
accrued expenses (28,489) (4,692)
Increase (decrease) in due to
related parties 31,381 (24,240)
__________ __________
2,362,999 1,904,548
__________ __________
Net cash provided by operating activities 2,480,710 2,298,719
__________ __________
Cash flows from investing activities:
Acquisition of equipment (2,781,652) (1,239,346)
Investment in direct financing leases (2,240,596) -
Proceeds from sale of equipment 137,377 202,527
__________ __________
Net cash used in investing activities (4,884,871) (1,036,819)
__________ __________
Cash flows from financing activities:
Distributions (425,000) (450,000)
__________ __________
Net cash used in financing activities (425,000) (450,000)
__________ __________
Increase (decrease) in cash and
cash equivalents (2,829,161) 811,900
Cash and cash equivalents, beginning
of period 3,679,630 3,234,408
__________ __________
Cash and cash equivalents, end of period $ 850,469 $4,046,308
========== ==========
The accompanying notes are an integral part of these financial statements.
5
FIDELITY LEASING INCOME FUND V, L.P.
NOTES TO FINANCIAL STATEMENTS
September 30, 1998
(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. EQUIPMENT LEASED
Equipment on lease consists primarily of computer equipment under operating
leases. 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 9 to 36 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 determine
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, $214,926 and 60,868
was charged to write-down of equipment to net realizable value for the nine
months ended September 30, 1998 and 1997, respectively. Any future losses
are dependent upon unanticipated technological developments affecting the
computer equipment industry in subsequent years.
The Fund also has equipment leased under the direct financing method in
accordance with Statement of Financial Accounting Standards No. 13. This
method provides for recognition of income (the excess of the aggregate
future rentals and estimated additional amounts recoverable upon expiration
of the lease over the related equipment cost) over the life of the lease
using the interest method.
The net investment in direct financing leases as of September 30, 1998 is
as follows:
Net minimum lease payments to be received $2,844,000
Less unearned income 384,000
Add expected future residuals -
__________
$2,460,000
==========
6
FIDELITY LEASING INCOME FUND V, L.P.
NOTES TO FINANCIAL STATEMENTS (Continued)
1. EQUIPMENT LEASED (Continued)
The future approximate minimum rentals to be received on noncancellable
operating and direct financing leases as of September 30, 1998 are as
follows:
Direct
Years Ending December 31 Operating Financing
________________________ _________ _________
1998 $ 653,000 $ 185,000
1999 1,823,000 741,000
2000 494,000 612,000
2001 - 520,000
Thereafter - 786,000
__________ __________
$2,970,000 $2,844,000
========== ==========
2. 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. This management fee is paid quarterly only if and when the
Limited Partners have received distributions for the period from January 1,
1989 through the end of the most recent quarter equal to a return for such
period at a rate of 12% per year on the aggregate amount paid for their
units.
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 and nine months
ended September 30, 1998 and 1997:
Three Months Ended Nine Months Ended
September 30 September 30
1998 1997 1998 1997
____ ____ ____ ____
Management fee $40,565 $57,022 $141,929 $149,031
Reimbursable costs 43,791 32,170 138,065 116,499
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.
7
FIDELITY LEASING INCOME FUND V, L.P.
NOTES TO FINANCIAL STATEMENTS (Continued)
2. RELATED PARTY TRANSACTIONS (Continued)
Amounts due from related parties at September 30, 1998 and December 31,
1997 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 September 30, 1998 and December 31, 1997
represents monies due to the General Partner 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 $125,000 in
November 1998 for the three months ended September 30, 1998, to all
admitted partners as of September 30, 1998.
8
FIDELITY LEASING INCOME FUND V, L.P.
Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Fidelity Leasing Income Fund V, L.P. had revenues of $803,055 and
$991,344 for the three months ended September 30, 1998 and 1997, respec-
tively, and $2,760,540 and $2,600,820 for the nine months ended September 30,
1998 and 1997, respectively. Rental income from the leasing of equipment
accounted for 86% and 95% of total revenues for the third quarter of
1998 and 1997, respectively and 91% and 94% of total revenues for the nine
months ended September 30, 1998 and 1997, respectively. The increase in
total revenues is primarily attributable to an increase in net gain on sale
of equipment. The Fund recognized $103,710 of net gain on sale of equipment
during the nine months ended September 30, 1998 compared to no net gain
recognized for the same period in 1997. Additionally, the increase in total
revenues was caused by the increase in rental income in 1998. Rental income
increased approximately $1,131,000 because of rents generated from equipment
purchased since the third quarter of 1997 as well as rental income earned on
1997 equipment purchases for which a full nine months was earned in 1998 but
only a portion of the nine months was earned in 1997. This increase, however,
was reduced by approximately $1,075,000 because of equipment that came off
lease and was re-leased at lower rental rates or sold. Furthermore, the Fund
invested in approximately $2.2 million of direct financing leases during the
nine months ended September 30, 1998 and earned $61,722 of income on direct
financing leases for this period compared to $12,076 earned for the nine months
ended September 30, 1997. This increase also accounts for the overall increase
in revenues in 1998. Interest income, however, decreased during 1998 because
of lower cash balances available for investment by the Fund. This decrease in
interest income lowered the amount of the total increase in revenues in 1998.
Expenses were $851,218 and $793,933 for the three months ended Septem-
ber 30, 1998 and 1997, respectively and $2,642,829 and $2,206,649 for the nine
months ended September 30, 1998 and 1997, respectively. Depreciation expense
comprised 71% and 62% of total expenses during the third quarter of 1998 and
1997, respectively and 77% and 73% of total expenses during the first nine
months of 1998 and 1997, respectively. The increase in expenses between 1998
and 1997 is primarily attributable to the increase in depreciation expense.
Depreciation expense increased because of new equipment purchased since the
third quarter of 1997 as well as depreciation taken on 1997 equipment
purchases for which a full nine months was recorded in 1998 and only a
portion of the nine months was recorded in 1997. In addition, the
increase in the write-down of equipment to net realizable value also caused
the increase in total expenses in 1998. Based upon the quarterly review of
the recoverability of the undepreciated cost of rental equipment, $214,926 was
charged to operations to write down equipment to its estimated net realizable
value for the nine months ended September 30, 1998 compared to $60,868 for the
nine months ended September 30, 1997. Any future losses are dependent upon
unanticipated technological developments affecting the computer
equipment industry in subsequent years. Furthermore, the equipment
remarketing fees that are included in general and administrative expenses
increased in 1998 compared to 1997 which also caused the increase in total
expenses during the nine months ended September 30, 1998. However, the Fund
recorded a net loss on sale of equipment of $210,264 for the nine months ended
September 30, 1997. There was no loss on sale of equipment incurred for the
nine months ended September 30, 1998 which mitigated the overall increase in
expenses during the current period.
9
FIDELITY LEASING INCOME FUND V, L.P.
Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS (Continued)
For the three months ended September 30, 1998 and 1997, the Fund had net
income (loss) of ($48,163) and $197,411, respectively. For the nine months
ended September 30, 1998 and 1997, the Fund had net income of $117,711 and
$394,171, respectively. The earnings (loss) per equivalent limited partnership
unit, after earnings (loss) allocated to the General Partner were ($2.00) and
$7.82 based on a weighted average number of equivalent limited partnership
units outstanding of 24,696 and 24,978 for the quarter ended September 30, 1998
and 1997, respectively. The earnings per equivalent limited partnership unit,
after earnings allocated to the General Partner, were $4.53 and $15.60 based
on a weighted average number of equivalent limited partnership units outstand-
ing of 25,077 and 24,986 for the nine months ended September 30, 1998 and 1997,
respectively.
The Fund generated cash from operations of $623,509 and $882,050, for the
purpose of determining cash available for distribution and distributed $125,000
and $150,000 to partners in November 1998 and 1997, respectively. For the nine
months ended September 30, 1998 and 1997, the Fund generated cash from
operations of $2,266,215 and $2,270,501 and distributed $275,000 and
$300,000 to partners during the nine months ended September 30, 1998 and
1997, respectively and $125,000 and $150,000 in November 1998 and 1997,
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 equipment with cash available from
operations and sales proceeds which were not distributed to partners. The Fund
purchased $2,781,651 and $1,239,346 of equipment during the nine months ended
September 30, 1998 and 1997, respectively. The Fund also invested $2,240,592
in direct financing leases during the nine months ended September 30, 1998.
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.
10
Part II: Other Information
FIDELITY LEASING INCOME FUND V, L.P.
September 30, 1998
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: EX-27
b) Reports on Form 8-K: None
11
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 V, L.P.
11-12-98 By: Freddie M. Kotek
________ _____________________________
Date Freddie M. Kotek
President of F.L. Partnership Management, Inc.
(Principal Operating Officer)
11-12-98 By: Marianne T. Schuster
________ _____________________________
Date Marianne T. Schuster
Vice President of F.L. Partnership Management, Inc.
(Principal Financial Officer)
12
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 V, L.P.
_____________________________
Date Freddie M. Kotek
President of F.L. Partnership Management, Inc.
(Principal Operating Officer)
________ _____________________________
Date Marianne T. Schuster
Vice President of F.L. Partnership Management, Inc.
(Principal Financial Officer)
12
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<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> SEP-30-1998
<CASH> 850,469
<SECURITIES> 0
<RECEIVABLES> 240,985
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 1,091,454
<PP&E> 9,860,023
<DEPRECIATION> 6,255,721
<TOTAL-ASSETS> 7,156,299
<CURRENT-LIABILITIES> 399,520
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 6,756,779
<TOTAL-LIABILITY-AND-EQUITY> 7,156,299
<SALES> 2,505,591
<TOTAL-REVENUES> 2,760,540
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 2,642,829
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 117,711
<INCOME-TAX> 0
<INCOME-CONTINUING> 117,711
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 117,711
<EPS-PRIMARY> 4.53
<EPS-DILUTED> 4.53
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