FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1934
For Quarter ended March 31, 2000
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Commission file number 0-16832
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IDM Participating Income Company-II
(A California Limited Partnership)
State of California 33-0177934
- -------------------------------------- -----------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification
incorporation or organization) Number)
2424 S.E. Bristol Street, Suite 333
Newport Beach, California 92660
- -------------------------------------- -----------------------------------
(Address of principal executive (Zip Code)
offices)
Registrant's telephone number,
including area code: (713) 706-6271
-----------------------------------------------
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 [ ].
Number of limited partnership interests outstanding as of March 31, 2000:
200,000
<PAGE>
PART I - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
The following financial statements are submitted in the next pages:
PAGE
NUMBER
------
Balance Sheets - March 31, 2000 and December 31, 1999 .................... 4
Statements of Operations - For the Three Months Ended March 31,
2000 and 1999 ............................................................ 5
Statements of Cash Flows - For the Three Months Ended March 31, 2000
and 1999 ................................................................. 6
Notes to Financial Statements ............................................ 7
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
Overview:
The following discussion should be read in conjunction with IDM Participating
Income Company-II's (the Partnership) Financial Statements and Notes thereto
appearing elsewhere in this Form 10-Q.
Results of Operations:
Interest income decreased by approximately $3,000, or 6%, for the three months
ended March 31, 2000 when compared to the corresponding period in 1999. This
decrease was the result of the collection of principal on a loan receivable from
an affiliate.
General and administrative expenses remained unchanged for the three months
ended March 31, 2000 when compared to the same period in 1999. An increase in
data processing and auditing costs were offset due to lower legal and insurance
costs incurred during the quarter.
2
<PAGE>
Liquidity and Capital Resources:
During the three months ended March 31, 2000, the Partnership's cash position
decreased primarily as a result of loans to affiliates. The Partnership is in an
illiquid position at March 31, 2000 with a cash balance of approximately $3,000
and current liabilities of approximately $21,000. The Partnership has no
commitments for any future capital expenditures.
Inflation:
The Partnership does not expect inflation to be a material factor in its
operations in 2000.
3
<PAGE>
IDM PARTICIPATING INCOME COMPANY - II
(A CALIFORNIA LIMITED PARTNERSHIP)
BALANCE SHEETS
MARCH 31, 2000 AND DECEMBER 31, 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
MARCH 31, 2000 DECEMBER 31, 1999
--------------- ---------------
(UNAUDITED)
<S> <C> <C>
ASSETS
Cash ........................................................... $ 3,000 $ 37,000
Loans to affiliates:
Interest receivable ........................................ 218,000 175,000
Principal, less reserve for possible losses
of $859,000 at March 31, 2000 and
December 31, 1999 .......................................... 1,458,000 1,471,000
Receivables from affiliates .................................... 38,000 0
--------------- ---------------
Total Assets ................................................... $ 1,717,000 $ 1,683,000
=============== ===============
LIABILITIES AND PARTNERS' CAPITAL
Accounts payable ............................................... $ 21,000 $ 0
Partners' capital:
General Partner ................................................ 440,000 440,000
Limited Partners:
200,000 units authorized,
200,000 issued and outstanding ............................. 1,256,000 1,243,000
--------------- ---------------
Total Partners' capital ........................................ 1,696,000 1,683,000
--------------- ---------------
Total Liabilities and Partners' capital ........................ $ 1,717,000 $ 1,683,000
=============== ===============
Limited partners' equity per unit .............................. $ 6.28 $ 6.22
=============== ===============
</TABLE>
See accompanying notes.
4
<PAGE>
IDM PARTICIPATING INCOME COMPANY - II
(A California Limited Partnership)
STATEMENTS OF OPERATIONS
For the Three Months Ended March 31, 2000 and 1999
- --------------------------------------------------------------------------------
THREE MONTHS ENDED
MARCH 31,
----------------------
2000 1999
--------- ---------
(UNAUDITED) (AUDITED)
Interest income ..................................... $ 44,000 $ 47,000
General and administrative expenses ................. (31,000) (31,000)
--------- ---------
Net income .......................................... $ 13,000 $ 16,000
--------- ---------
Net income allocable to
limited partners ................................. $ 13,000 $ 16,000
========= =========
Number of limited partnership
interests outstanding ............................ 200,000 200,000
========= =========
Net income per limited
partnership interest ............................. $ 0.07 $ 0.08
========= =========
See accompanying notes.
5
<PAGE>
IDM PARTICIPATING INCOME COMPANY - II
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENTS OF CASH FLOWS
FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND 1999
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
THREE MONTHS ENDED MARCH 31,
------------------------------------
2000 1999
--------------- ---------------
(UNAUDITED) (UNAUDITED)
--------------- ---------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income ....................................................................... $ 13,000 $ 16,000
Adjustments to reconcile net income to cash
used in operating activities:
Increase in interest receivable ............................................... (43,000) (43,000)
Decrease in prepaid expenses .................................................. 0 4,000
Increase in accounts payable .................................................. 21,000 3,000
--------------- ---------------
Net cash used in operating activities ......................................... (9,000) (20,000)
--------------- ---------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Collections of loans from affiliates ............................................. 13,000 17,000
--------------- ---------------
Net cash provided by investing activities ..................................... 13,000 17,000
--------------- ---------------
CASH FLOWS FROM FINANCING ACTIVITITES:
Advances to affiliates ........................................................... (38,000) (1,000)
--------------- ---------------
Net cash used in financing activities ......................................... (38,000) (1,000)
--------------- ---------------
NET DECREASE IN CASH ............................................................... (34,000) (4,000)
Cash beginning of period ........................................................ 37,000 8,000
--------------- ---------------
Cash end of period .............................................................. $ 3,000 $ 4,000
=============== ===============
</TABLE>
See accompanying notes
6
<PAGE>
IDM PARTICIPATING INCOME COMPANY-II
A California Limited Partnership
Notes to Financial Statements
(Unaudited)
1. BASIS OF FINANCIAL STATEMENTS
In the opinion of the Partnership's management, these unaudited financial
statements reflect all adjustments which are necessary for a fair presentation
of its financial position at March 31, 2000 and results of operations and cash
flows for the periods presented. All adjustments included in these statements
are of a normal and recurring nature. These financial statements should be read
in conjunction with the financial statements and notes thereto contained in the
Form 10-K of the Partnership for the year ended December 31, 1999.
2. RELATED PARTY TRANSACTIONS
Affiliates of the general partner are reimbursed for certain general and
administrative services provided to the Partnership. During the three months
ended March 31, 2000 and 1999, affiliates received approximately $2,000 and
$3,000, respectively, for such services.
7
<PAGE>
PART IV - OTHER INFORMATION
ITEM 14. EXHIBITS AND REPORTS ON FORM 8-K
A. EXHIBITS:
The following Exhibits are filed herewith pursuant to Rule 601 of Regulation
S-K.
(27) Financial Data Schedule
B. REPORTS ON FORM 8-K
A Form 8-K was filed in May 2000 reporting a change in the Partnership's
Certifying Accountant.
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.
IDM PARTICIPATING INCOME COMPANY-II,
a California Limited Partnership
IDM PARTICIPATING INCOME CORPORATION
General Partner of the General Partner
Date: May 10, 2000 /s/ WILLIAM J. CARDEN
------------ ------------------------------------
William J. Carden
Director
8
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THE FINANCIAL DATA SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM IDM PARTICIPATING INCOME COMPANY - II MARCH 31, 2000 FINANCIAL STATEMENTS
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-END> MAR-31-2000
<CASH> 3,000
<SECURITIES> 0
<RECEIVABLES> 256,000
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 259,000
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 1,717,000
<CURRENT-LIABILITIES> 21,000
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 1,696,000
<TOTAL-LIABILITY-AND-EQUITY> 1,717,000
<SALES> 0
<TOTAL-REVENUES> 44,000
<CGS> 0
<TOTAL-COSTS> 31,000
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 13,000
<INCOME-TAX> 0
<INCOME-CONTINUING> 13,000
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 13,000
<EPS-BASIC> .07
<EPS-DILUTED> .07
</TABLE>
