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 September 30, 1998
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
STATEMENTS OF FINANCIAL POSITION AS OF
<TABLE>
<CAPTION>
(Unaudited)
September 30, December 31,
1998 1997
<S> <C> <C>
Assets
Cash and cash
equivalents $ 292,051 $ 200,328
Rentals receivable 2,565 45,665
Accounts receivable-
affiliates 24,298 61,368
Notes receivable-lessee 0 14,641
Remarketing receivables 16,168 56,010
Rental equipment,
at cost 20,020,546 32,491,943
Less accumulated
depreciation (13,161,046) (13,732,945)
Net rental equipment 6,859,500 18,758,998
Total assets $ 7,194,582 $19,137,010
Liabilities and
partners' capital
Accounts payable $ 82,731 $ 78,738
Accrued management fees 18,532 35,639
Deferred income 10,853 60,558
Notes payable 3,072,345 12,629,981
Total liabilities 3,184,461 12,804,916
Partners' capital:
General Partner:
Capital contribution 1,000 1,000
Cumulative net income 413,692 267,020
Cumulative cash
distributions (414,692) (391,966)
0 (123,946)
Limited Partners
(500,000 units):
Capital contributions
net of offering costs 44,539,778 44,539,778
Cumulative net income 569,558 765,477
Cumulative cash
distributions (41,099,215) (38,849,215)
4,010,121 6,456,040
Total Partners'
capital 4,010,121 6,332,094
Total liabilities and
partners' capital $ 7,194,582 $19,137,010
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CSA INCOME FUND LIMITED PARTNERSHIP III
STATEMENTS OF OPERATIONS (UNAUDITED) FOR THE THREE
AND NINE MONTH PERIODS ENDED SEPTEMBER 30, 1998 AND 1997
Three Months Ended Nine Months Ended
September, September, September, September,
30, 1998 30, 1997 30, 1998 30, 1997
<S> <C> <C> <C> <C>
Revenues:
Rental income $1,434,086 $2,565,381 $ 5,807,860 $7,865,919
Interest income 1,013 1,947 2,543 21,724
Gain on sale
of equipment 233,459 44,584 378,106 255,913
Exchange
gain on
foreign currency 168 2,437 367 6,874
Total revenues 1,668,726 2,614,349 6,188,876 8,150,430
Costs and expenses:
Depreciation and
amortization 1,419,000 2,243,729 5,351,574 6,489,409
Interest 83,213 323,377 484,995 904,267
Management fees 71,704 128,269 290,393 393,296
Storage and
Refurbishment 1,000 - 1,000 3,253
General and
administrative 28,376 43,670 110,160 137,279
Total expenses 1,603,293 2,739,045 6,238,122 7,927,504
Net income (loss) $ 65,433 $ (124,696) $ (49,246) $ 222,926
Net income (loss)
allocation:
General Partner $ 7,574 $ 44,584 $ 146,672 $ 255,913
Limited Partners 57,859 (169,280) (196,018) (32,987)
$ 65,433 $ (124,696) $ (49,246) $ 222,926
Net income (loss) per
Limited Partnership
Unit $ .12 $ (.34) $ (.39) $ ( .07)
Number of Limited
Partnership Units 500,000 500,000 500,000 500,000
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
CSA INCOME FUND LIMITED PARTNERSHIP III
STATEMENTS OF CASH FLOWS (UNAUDITED) FOR THE THREE
AND NINE MONTH PERIODS ENDED SEPTEMBER 30, 1998 AND 1997
Three Months Ended Nine Months Ended
September, September, September, September,
30, 1998 30, 1997 30, 1998 30, 1997
<S> <C> <C> <C> <C>
Cash flows from
operations:
Cash received from
rental of
equipment $ 1,368,677 $ 2,531,115 $ 5,790,688 $ 7,768,563
Cash paid for
operating and
management
expenses (68,747) (146,939) (414,667) (504,476)
Interest paid (83,213) (323,377) (484,996) (904,267)
Interest received 1,012 1,947 2,543 21,724
Net cash from
operations 1,217,729 2,062,746 4,893,568 6,381,544
Cash flow from
investments:
Purchase of equipment - (33,522) - (5,661,691)
Sale of equipment 2,575,491 229,938 6,965,873 877,025
Net cash from
(used by)
investments 2,575,491 196,416 6,965,873 (4,784,666)
Cash flows from financing:
Proceeds from notes
receivable - 3,555 10,933 20,892
Advances to/from
affiliates 46,165 63,613 37,070 1,101,266
Proceeds from notes
payable 14,641 388,795 14,641 5,648,889
Repayment of notes
payable (2,946,990) (2,164,469) (9,557,636) (6,324,333)
Payment of cash
distributions (757,574) (757,575) (2,272,726) (2,272,727)
Net cash used by
financing (3,643,758) (2,466,081) (11,767,718) (1,826,013)
Net change in cash 149,462 (206,919) 91,723 (229,135)
Cash and cash equivalents
at beginning
of period 142,589 428,569 200,328 450,785
Cash and cash equivalents
at end of period $ 292,051 $ 221,650 $ 292,051 $ 221,650
</TABLE>
<PAGE>
CSA INCOME FUND LIMITED PARTNERSHIP III
NOTE TO FINANCIAL STATEMENTS
The quarterly financial statements of the Partnership presented herein
are without audit except for balance sheet information as of December 31,
1997. Certain information and footnote disclosure 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,
1997.
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 September 30,
1998 and September 30, 1997 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
Total revenue was $1,668,726 and $2,614,349 for the quarters ended
September 30, 1998 and 1997,respectively. Net income for the quarter ended
September 30, 1998 was $65,433 as compared to a net loss of $124,696 in the
quarter ended September 30, 1997. For the nine months ended September 30,
1998 and September 30,1997, total revenue was $6,188,876 and $8,150,430,
respectively. A net loss of $49,246 was recorded for the first
nine months ended September 30, 1998 as compared to income of $222,926 in
the nine months ended September 30, 1997. The net income decrease is
primarily due to an increase in depreciation expense as a percentage of
rental revenue as the portfolio winds-down.
The Partnership generated cash flow of $11,859,441 from operations and sale
of equipment during the nine months ended September 30, 1998. The
Partnership used these funds and cash on hand to reduce notes payable by
$9,557,636 and make distributions to partners of $2,272,726. Also as part of
the Partnership wind-up process, the notes payable were further reduced,
by $1,643,355 as a result of the Partnership selling, subject to existing
notes payables, equipment under lease having original equipment
cost of $3,303,188.
The General Partner of CSA Income Fund Limited Partnership III informed
the Limited Partners in the Partnership's 1997 10-K, Annual Report and
thereafter that in it's opinion, it would be in the best interest of the
Limited Partners and the Partnership to wind-up the Partnership in 1998.
As of September 30, 1998, the General Partner has sold approximately
$12,450,000 original cost of equipment under lease. The Partnership
has approximately $6,860,000 original cost of leased equipment to
sell to complete the wind-up. The General Partner will endeavor
to complete the wind-up of the Partnership by December 31, 1998 if
prevailing market opportunities allow the sale of the remaining
leases at or above fair market value to maximize the return to
all Limited Partners. If this process is going to be delayed into
1999, you will be informed in December. As previously reported,
in connection with the wind up of the Partnership, certain accounting
gains on the disposition of partnership assets were allocated during
the third quarter of 1998 to the General Partner to reduce its
Capital Account negative balance.
The Partnership distributed $.50 per Limited Partnership Unit on the 15th
of July, August, and September. To date, the Partnership has made cash
distributions to the Limited Partners ranging from 75% to 91% of their
initial investment. The General Partner continues to estimate as
previously reported, that the continued cash distributions will not
fully return the entire initial investment of the Limited Partners
and/or a return thereon. We will continue to report on the Limited
Partners' return of investment with each remaining cash distribution.
<PAGE>
<TABLE>
<CAPTION>
CSA INCOME FUND LIMITED PARTNERSHIP III
PART II
<S> <C>
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 the third quarter of 1998.
</TABLE>
<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: 11/13/98
/s/ J. Frank Keohane
President
Principal Executive Officer
Date: 11/13/98
/s/ Richard P.Timmons
Corporate Controller
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
September 30, 1998 and Statement of Operations for the nine months then ended
and is qualified in its entirely by reference to such financial statements.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1998
<PERIOD-END> SEP-30-1998
<CASH> 292,051
<SECURITIES> 0
<RECEIVABLES> 43,031
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0<F1>
<PP&E> 20,020,546
<DEPRECIATION> 13,161,046
<TOTAL-ASSETS> 7,194,582
<CURRENT-LIABILITIES> 0<F1>
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 4,010,121
<TOTAL-LIABILITY-AND-EQUITY> 7,194,582
<SALES> 0
<TOTAL-REVENUES> 6,188,876
<CGS> 0
<TOTAL-COSTS> 5,641,967
<OTHER-EXPENSES> 111,160
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 484,995
<INCOME-PRETAX> (49,246)
<INCOME-TAX> 0
<INCOME-CONTINUING> (49,246)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (49,246)
<EPS-PRIMARY> (0.39)
<EPS-DILUTED> (0.39)
<FN>
<F1>The Registrant maintains an unclassified Statement of Financial Position.
</FN>
</TABLE>
