FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(X) QUARTERLY REPORT UNDER SECTION 13 OR 15 (D) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1996
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 33-21267
CSA Income Fund Limited Partnership III
(Exact name of registrant as specified in its charter)
Massachusetts 04-3002909
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
22 Batterymarch St., Boston, Massachusetts 02109
(Address of principal executive offices) (Zip Code)
(617) 357-1700
(Registrant's telephone number, including area code)
Former name, former address and former fiscal year,
if changed since last report
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 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>
PART I - FINANCIAL INFORMATION
CSA INCOME FUND LIMITED PARTNERSHIP III
<TABLE>
CSA INCOME FUND LIMITED PARTNERSHIP III
STATEMENTS OF FINANCIAL POSITION AS OF JUNE 30, 1996 (UNAUDITED) AND
DECEMBER 31, 1995
______________________________________________________________________
<CAPTION>
(Unaudited)
June 30, December 31,
1996 1995
<S> <C> <C>
Assets
Cash and cash equivalents $ 855,607 $ 6,210,985
Rentals receivable 347,471 5,928
Accounts receivable-affiliates 1,915,709 200,169
Interest receivable 5,667 15,626
Notes receivable-lessee 85,000 85,000
Remarketing receivables 53,883 234,381
Rental equipment, at cost 29,169,944 26,648,802
Less accumulated depreciation (12,264,160) (15,490,492)
Net rental equipment 16,905,784 11,158,310
Total assets $ 20,169,121 $ 17,910,399
Liabilities and partners' capital
Accounts payable-affiliates $ - $ 37,928
Accounts payable-other 26,178 36,803
Accrued management fees 33,832 49,632
Deferred income 333,685 450,786
Notes payable 8,939,714 5,609,093
Limited recourse notes payable 26,059 38,009
Total liabilities 9,359,468 6,222,251
Partners' capital:
General Partner:
Capital contribution 1,000 1,000
Cumulative net income 9,646 3,279
Cumulative cash distributions (346,512) (331,360)
(335,866) (327,081)
Limited Partners (500,000 units):
Capital contributions net of
offering costs 44,539,778 44,539,778
Cumulative net income 954,956 324,666
Cumulative cash distributions (34,349,215) (32,849,215)
11,145,519 12,015,229
Total Partners' capital 10,809,653 11,688,148
Total liabilities and
partners' capital $ 20,169,121 $ 17,910,399
</TABLE>
<PAGE>
<TABLE>
CSA INCOME FUND LIMITED PARTNERSHIP III
STATEMENTS OF OPERATIONS (UNAUDITED) FOR THE THREE AND SIX MONTH
PERIODS ENDED JUNE 30, 1996 AND 1995
______________________________________________________________________
<CAPTION>
THREE MONTHS SIX MONTHS
1996 1995 1996 1995
<S> <C> <C> <C> <C>
Revenues:
Rental income $ 1,681,627 $ 2,421,434 $ 3,344,418 $ 5,295,202
Interest income 23,240 45,119 80,645 95,702
Gain on sale
of equipment 332,190 212,397 259,089 294,407
Exchange gain (loss)
on foreign currency (1,057) 1,640 (1,736) 9,850
Total revenues 2,036,000 2,680,590 3,682,416 5,695,161
Costs and expenses:
Depreciation and
amortization 1,395,275 1,872,012 2,553,098 4,063,400
Interest 118,552 99,059 233,731 207,046
Management fees 84,081 121,072 167,221 264,760
Storage and
Refurbishment 7,000 5,000 12,000 10,000
General and
administrative 39,222 67,694 79,709 108,510
Total expenses 1,644,130 2,164,837 3,045,759 4,653,716
Net income $ 391,870 $ 515,753 $ 636,657 $ 1,041,445
Net income allocation:
General Partner $ 3,919 $ 5,158 $ 6,367 $ 10,414
Limited Partners 387,951 510,595 630,290 1,031,031
$ 391,870 $ 515,753 $ 636,657 $ 1,041,445
Net income per
Limited Partnership
Unit $ .78 $ 1.02 $ 1.26 $ 2.06
Number of Limited
Partnership Units 500,000 500,000 500,000 500,000
</TABLE>
<PAGE>
<TABLE>
CSA INCOME FUND LIMITED PARTNERSHIP III
STATEMENTS OF CASH FLOWS (UNAUDITED) FOR THE THREE AND SIX MONTH
PERIODS ENDED JUNE 30, 1996 AND 1995
______________________________________________________________________
<CAPTION>
THREE MONTHS SIX MONTHS
1996 1995 1996 1995
<S> <C> <C> <C> <C>
Cash flows from
operations:
Cash received from
rental of
equipment $ 1,672,902 $ 1,683,469 $ 2,877,337 $ 3,773,369
Cash paid for
operating and
management expenses (156,159) (175,012) (285,355) (371,137)
Interest paid (112,094) (31,961) (221,226) (76,467)
Interest received 20,525 45,119 90,604 95,702
Net cash from
operations 1,425,174 1,521,615 2,461,360 3,421,467
Cash flow from
investments:
Value added tax
deposits - - - 239,724
Purchase of
equipment (4,925,192) (355,580) (9,318,385) (355,580)
Sale of equipment 1,165,963 171,710 1,451,596 1,138,009
Net cash from
(used by)
investments (3,759,229) (183,870) (7,866,789) 1,022,153
Cash flows from
financing:
Accounts payable -
equipment
purchases (1,331,217) - - (98,995)
Advances to/from
affiliates (2,474,079) (290,180) (1,753,468) (283,403)
Proceeds from
notes payable 4,749,792 258,537 4,749,792 258,537
Repayment of
notes payable (764,403) (527,043) (1,431,121)(1,662,644)
Payment of cash
distributions (757,576) (757,576) (1,515,152)(1,515,152)
Net cash from
used by
financing (577,483) (1,316,262) 50,051 (3,301,657)
Net change in cash (2,911,538) 21,483 (5,355,378) 1,141,963
Cash at beginning
of period 3,767,145 4,190,926 6,210,985 3,070,446
Cash at end
of period $ 855,607 $ 4,212,409 $ 855,607$ 4,212,409
</TABLE>
<PAGE>
CSA INCOME FUND LIMITED PARTNERSHIP III
NOTE TO FINANCIAL STATEMENTS
______________________________________________________________________
The quarterly financial statements have been prepared by the
Partnership without audit. Certain information and footnote
disclosures normally included in the annual financial statements have
been condensed or omitted from the accompanying statements. For such
information, reference should be made to the financial statements and
notes thereto included in the Partnership's annual report on Form 10-K
for the year ended December 31, 1995.
In the General Partner's opinion, the unaudited financial statements
reflect all adjustments necessary to present fairly the financial
position of CSA Income Fund Limited Partnership III as of June 30,
1996 and December 31, 1995 and the results of operations and cash
flows for the periods presented therein.
<PAGE>
CSA INCOME FUND LIMITED PARTNERSHIP III
GENERAL PARTNER'S DISCUSSION OF OPERATIONS
______________________________________________________________________
Rental income was $1,681,627 and $2,421,434 and net income was
$391,870 and $515,753 for the quarters ended June 30, 1996 and 1995,
respectively. For the six months ended June 30, 1996 and June 30,1995,
gross rental income was $3,344,418 and $5,295,202 and net income was
$636,657 and $1,041,445, respectively. The decrease in gross rental
income and net income is attributable to the expected occurrence of
reduced rental rates for re-leased equipment and to the ongoing sale
of equipment from the Partnership's portfolio. However, the Partnership
continues actively to seek out additional lease opportunities and has
acquired $4,393,193 and $4,925,192 of equipment during the first and second
quarters of 1996, respectively.
The Partnership generated $3,912,956 from operations and sale of
equipment during the six months ended June 30, 1996. The Partnership
used these funds, proceeds from equipment financings and cash on hand
to acquire additional equipment of $9,318,385, make payments on notes
payable of $1,431,121 and make distributions to partners of
$1,515,152.
The Partnership's results of operations and liquidity in future
periods will be dependent upon the addition of leased equipment, the
sale and/or re-lease of equipment as it comes off lease and the level
of debt service.
The Partnership distributed $.50 per Limited Partnership Unit on the
15th of April, May, and June. To date, the Partnership has made cash
distributions to the Limited Partners ranging from 61% to 77% of their
initial investment, depending on when the Limited Partner entered the
Partnership. The objective of the Partnership is to return the Limited
Partners' investment through current cash distributions and provide a
return on this investment by continued distributions as long as the
equipment continues to be leased. However, revenues generated by the
Partnership from lease renewals and remarketings after the initial
lease terms have been lower than anticipated as a result of rapid
technological obsolescence in high technology equipment. While the
General Partner continues to pursue additional lease opportunities to
increase the Partnership's distributions, based on an analysis of the
remaining assets in the Partnership's portfolio, the General Partner
presently estimates that the continued cash distributions may not
fully return the entire initial investment of the Limited Partners
and/or a return thereon. The General Partner will continue to report
on the Limited Partners' return of investment with each cash
distribution.
<PAGE>
CSA INCOME FUND LIMITED PARTNERSHIP III
PART II
______________________________________________________________________
Item 1 - Legal Proceedings
None
Item 2 - Changes in Securities
None
Item 3 - Defaults Upon Senior Securities
None
Item 4 - Submission of Matters to a Vote of Security Holders
None
Item 5 - Other Information
None
Item 6 - Exhibits and Reports on Form 8-K
(a) Exhibits - Exhibit 27. Financial Data Schedule.
(b) Reports on Form 8-K - No reports have been filed on Form
8-K during this quarter.
<PAGE>
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.
CSA Income Fund Limited
Partnership III (Registrant)
By its General Partner,
CSA Equity Funds, Inc.
Date: August 9, 1996 /s/ J. Frank Keohane
President and
Principal Executive Officer
Date: August 9, 1996 /s/ Richard F. Sullivan
Vice President
Principal Accounting and
Finance Officer
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
This schedule contains summary financial information extracted from CSA Income
Fund Limited Partnership III's Statement of Financial Position as of June 30,
1996 and Statement of Operations for the six months then ended and is qualified
in its entirety by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> JUN-30-1996
<CASH> 855,607
<SECURITIES> 0
<RECEIVABLES> 2,407,730
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 29,169,944
<DEPRECIATION> 12,264,160
<TOTAL-ASSETS> 20,169,121
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 10,809,653
<TOTAL-LIABILITY-AND-EQUITY> 20,169,121
<SALES> 0
<TOTAL-REVENUES> 3,682,416
<CGS> 2,732,319
<TOTAL-COSTS> 3,045,759
<OTHER-EXPENSES> 79,709
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 233,731
<INCOME-PRETAX> 636,657
<INCOME-TAX> 0
<INCOME-CONTINUING> 636,657
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 636,657
<EPS-PRIMARY> 1.26
<EPS-DILUTED> 1.26
<FN>
<F1> The Registrant maintains an unclassified Statement of Financial Position.
</FN>
</TABLE>
