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, 1999
/ / 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 No.)
3 North Columbus Boulevard, Philadelphia, Pennsylvania 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 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 1 of 12
Part I: Financial Information
Item 1: Financial Statements
FIDELITY LEASING INCOME FUND V, L.P.
BALANCE SHEETS
ASSETS
(Unaudited) (Audited)
March 31, December 31,
1999 1998
_____________ ____________
Cash and cash equivalents $2,275,178 $1,822,926
Accounts receivable 307,995 232,606
Due from related parties 80,968 147,930
Equipment under operating leases (net
of accumulated depreciation of
$4,816,674 and $4,559,234,
respectively) 1,958,976 2,294,009
Net investment in direct
financing leases 2,330,151 2,489,583
Equipment held for sale or lease 48,501 60,701
__________ __________
Total assets $7,001,769 $7,047,755
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Lease rents paid in advance $ 150,392 $ 155,878
Accounts payable and
accrued expenses 112,236 84,219
Due to related parties 55,892 61,485
__________ __________
Total liabilities 318,520 301,582
Partners' capital 6,683,249 6,746,173
__________ __________
Total liabilities and
partners' capital $7,001,769 $7,047,755
========== ==========
The accompanying notes are an integral part of these financial statements.
2
FIDELITY LEASING INCOME FUND V, L.P.
STATEMENTS OF OPERATIONS
For the three months ended March 31, 1999 and 1998
(Unaudited)
1999 1998
________ ________
Income:
Rentals $416,162 $891,246
Earned income on direct financing leases 80,371 -
Interest 21,617 44,785
Gain on sale of equipment, net 2,850 54,500
Other 9,040 1,383
________ ________
530,040 991,914
________ ________
Expenses:
Depreciation 323,524 694,951
Write-down of equipment to net
realizable value 23,710 -
General and administrative 28,466 32,584
General and administrative to related
party 38,430 43,015
Management fee to related party 46,847 51,643
________ ________
460,977 822,193
________ ________
Net income $ 69,063 $169,721
======== ========
Net income per equivalent
limited partnership unit $ 2.76 $ 6.65
======== ========
Weighted average number of
equivalent limited partnership
units outstanding during the period 24,590 25,267
======== ========
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 three months ended March 31, 1999
(Unaudited)
General Limited Partners
Partner Units Amount Total
_______ _____ ______ _____
Balance, January 1, 1999 $ 2,516 76,137 $6,743,657 $6,746,173
Redemptions - (90) (6,987) (6,987)
Cash distributions (1,250) - (123,750) (125,000)
Net income 1,250 - 67,813 69,063
_______ ______ __________ __________
Balance, March 31, 1999 $ 2,516 76,047 $6,680,733 $6,683,249
======= ====== ========== ==========
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 three months ended March 31, 1999 and 1998
(Unaudited)
1999 1998
________ ________
Cash flows from operating activities:
Net income $ 69,063 $ 169,721
__________ __________
Adjustments to reconcile net income
to net cash provided by operating
activities:
Depreciation 323,524 694,951
Write-down of equipment to net
realizable value 23,710 -
(Gain) loss on sale of equipment, net (2,850) (54,500)
(Increase) decrease in accounts
receivable (75,389) (173,720)
(Increase) decrease in due from
related parties 66,962 35,351
Increase (decrease) in lease rents
paid in advance (5,486) (16,375)
Increase (decrease) in accounts
payable and accrued expenses 28,017 144,275
Increase (decrease) in accounts
payable - equipment - 692,514
Increase (decrease) in due to
related parties (5,593) (11,000)
__________ __________
352,895 1,311,496
__________ __________
Net cash provided by operating activities 421,958 1,481,217
__________ __________
Cash flows from investing activities:
Acquisition of equipment - (2,109,553)
Proceeds from direct financing leases,
net of earned income 159,431 -
Proceeds from sale of equipment 2,850 54,500
__________ __________
Net cash provided by (used in)
investing activities 162,281 (2,055,053)
__________ __________
Cash flows from financing activities:
Distributions (125,000) (150,000)
Redemptions of capital (6,987) -
__________ __________
Net cash used in financing activities (131,987) (150,000)
__________ __________
Increase (decrease) in cash and
cash equivalents 452,252 (723,836)
Cash and cash equivalents, beginning
of period 1,822,926 3,679,630
__________ __________
Cash and cash equivalents, end of period $2,275,178 $2,955,794
========== ==========
The accompanying notes are an integral part of these financial statements.
5
FIDELITY LEASING INCOME FUND V, L.P.
NOTES TO FINANCIAL STATEMENTS
March 31, 1999
(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 of equipment under operating leases. The
lessees have agreements with the manufacturer of the equipment 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 the equipment and com-
petitive 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,
$23,710 was charged to write-down of equipment to net realizable value
for the three months ended March 31, 1999. There was no charge to write-
down of equipment to net realizable value for the three months ended
March 31, 1998. Any future losses are dependent upon unanticipated
technological developments affecting the types of equipment in the port-
folio 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 unguaranteed residuals upon expiration
of the lease over the related equipment cost) over the life of the lease
using the interest method.
Unguaranteed residuals for direct financing leases represent the estimated
amounts recoverable at lease termination from lease extensions or
disposition of the equipment. The Fund reviews these residual values
quarterly. If the equipment's fair market value at lease expiration is
below the estimated residual value, an adjustment is made.
6
FIDELITY LEASING INCOME FUND V, L.P.
NOTES TO FINANCIAL STATEMENTS (Continued)
1. EQUIPMENT LEASED (continued)
The net investment in direct financing leases as of March 31, 1999 is as
follows:
Minimum lease payments to be received $2,571,000
Unguaranteed residuals 171,000
Unearned rental income (370,000)
Unearned residual income (42,000)
__________
$2,330,000
==========
The future approximate minimum rentals to be received on noncancellable
operating and direct financing leases as of March 31, 1999 are as follows:
Direct
Operating Financing
1999 $1,056,000 $ 719,000
2000 444,000 627,000
2001 - 494,000
2002 - 487,000
2003 - 244,000
__________ __________
$1,500,000 $2,571,000
========== ==========
2. RELATED PARTY TRANSACTIONS
The General Partner receives 6% or 3% of gross rental payments from
equipment under operating leases and full pay-out leases, respectively,
for administrative and management services performed on behalf of the
Fund. This management fee is paid quarterly only if and when the Limi-
ted 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. Fol-
lowing 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:
1999 1998
________ ________
Management fee $46,847 $51,643
Reimbursable costs 38,430 43,015
7
FIDELITY LEASING INCOME FUND V, L.P.
NOTES TO FINANCIAL STATEMENTS (Continued)
2. RELATED PARTY TRANSACTIONS (continued)
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, 1999 and December 31,
1998 represent monies due the Fund from the General Partner and/or
other affiliated funds for rentals and sales proceeds collected and not
yet remitted to the Fund.
Amounts due to related parties at March 31, 1999 and December 31, 1998
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. YEAR 2000 COMPLIANCE
Two of the three main software systems utilized to generate informa-
tion for the Fund are still in the testing phase. The third software
system should be Year 2000 capable by July 1999. The costs incurred
to complete the Year 2000 Compliance project are not expected to be
material to the net income of the Fund.
All suppliers for the Fund continue to complete their Year 2000
Compliance programs. It is not anticipated that the Fund will incur
any significant losses should any of its outside suppliers fail to
meet their Year 2000 Compliance deadlines.
4. CASH DISTRIBUTION
The General Partner declared and paid a cash distribution of $125,000
in May 1999 for the three months ended March 31, 1999, to all admitted
partners as of March 31, 1999.
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 $530,040 and
$991,914 for the three months ended March 31, 1999 and 1998, respectively.
Rental income from the leasing of equipment accounted for 79% and 90% of
total revenues for the first quarter of 1999 and 1998, respectively. The
decrease in revenues is primarily attributable to a decrease in rental income.
In 1998, rental income decreased by approximately $592,000 because of equip-
ment which came off lease and was re-leased at lower rental rates or sold.
This decrease in total revenues was mitigated by an increase in rental income
of approximately $117,000 resulting from equipment purchases made in 1998
for which a full three months of rent was earned in the current quarter and
only a portion of the three months was earned in the first quarter of 1998.
Additionally, the Fund recognized a net gain on sale of equipment of $2,850
for the quarter ended March 31, 1999 compared to $54,500 for the quarter
ended March 31, 1998, which also contributed to the decrease in total
revenues in 1999. Furthermore, interest income decreased in 1999 compared
to 1998 because of lower cash balances available for investment by the Fund
as of March 31, 1999. However, the Fund invested in $2.7 million of direct
financing leases subsequent to March 31, 1998 which generated earned income
on direct financing leases of $80,371 for the first quarter of 1999. There
were no direct financing leases as of March 31, 1998. The increase in this
account served to reduce the overall decrease in revenues in 1999.
Expenses were $460,977 and $822,193 during the three months ended
March 31, 1999 and 1998, respectively. Depreciation expense comprised 70%
and 85% of total expenses during the first quarter of 1999 and 1998,
respectively. The decrease in expenses between 1999 and 1998 is
primarily attributable to a decrease in depreciation expense because of
equipment that terminated or was sold since March 1998. However, the
increase in write-down of equipment to net realizable value reduced the
overall decrease in expenses. Based upon the review of the recoverability
of the undepreciated cost of rental equipment, $23,710 was charged to
operations to write down equipment to its estimated net realizable value
for the three months ended March 31, 1999. There was no write-down of
equipment to net realizable value recorded for the three months ended
March 31, 1998. Any future losses are dependent upon unanticipated
technological developments affecting the types of equipment in the
portfolio in subsequent years.
For the three months ended March 31, 1999 and 1998, the Fund's net
income was $69,063 and $169,721, respectively. The earnings per equivalent
limited partnership unit, after earnings allocated to the General Partner
were $2.76 and $6.65 based on a weighted average number of equivalent
limited partnership units outstanding of 24,590 and 25,267 for the quarter
ended March 31, 1999 and 1998, respectively.
9
FIDELITY LEASING INCOME FUND V, L.P.
Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (Continued)
The Fund generated cash from operations of $413,447 and $810,172, for
the purpose of determining cash available for distribution and distributed
$125,000 and $150,000 to partners in May 1999 and 1998, respectively for
the first quarter of 1999 and 1998, respectively. Cash distributions of
$125,000 and $150,000 were paid to partners during the first quarter of
1999 and 1998, repectively for the three months ended December 31, 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 the process of dissolution during 1999. As provided
in the Restated Limited Partnership Agreement, the assets of the Fund shall
be liquidated as promptly as is consistent with obtaining their fair value.
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.
March 31, 1999
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
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
FIDELITY LEASING INCOME FUND V, L.P.
5-13-99 By: Freddie M. Kotek
_______ ___________________________
Date Freddie M. Kotek
President of
F.L. Partnership Management, Inc.
(Principal Operating Officer)
5-13-99 By: Marianne T. Schuster
_______ ___________________________
Date Marianne T. Schuster
Vice President of
F.L. Partnership Management, Inc.
(Principal Financial Officer)
12
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<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-END> MAR-31-1999
<CASH> 2,275,178
<SECURITIES> 0
<RECEIVABLES> 388,963
<ALLOWANCES> 0
<INVENTORY> 0
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<PP&E> 6,824,151
<DEPRECIATION> 4,816,674
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<CURRENT-LIABILITIES> 318,520
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 6,683,249
<TOTAL-LIABILITY-AND-EQUITY> 7,001,769
<SALES> 416,162
<TOTAL-REVENUES> 530,040
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 460,977
<LOSS-PROVISION> 0
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<INCOME-TAX> 0
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