<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
[ X X ] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended September 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 _____________________
_____________________
For Quarter Ended September 30, 1996 Commission File No. 0-19135
American Income Partners V-D Limited Partnership
_______________________________________________________________________________
(Exact name of registrant as specified in its charter)
Massachusetts 04-3090151
________________________________________ ___________________
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
98 North Washington Street, Boston, MA 02114
________________________________________ ___________________
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (617) 854-5800
_____________________________
_______________________________________________________________________________
(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 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
------ ------
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Indicate by check mark whether the registrant has filed all documents
and reports required to be filed by Sections 12, 13, or 15(d) of the
Securities Exchange Act of 1934 subsequent to the distribution of securities
under a plan confirmed by a court 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>
AMERICAN INCOME PARTNERS V-D LIMITED PARTNERSHIP
FORM 10-Q
INDEX
Page
----
PART I. FINANCIAL INFORMATION:
Item 1. Financial Statements
Statement of Financial Position
at September 30, 1996 and December 31, 1995 3
Statement of Operations
for the three and nine months ended September 30, 1996
and 1995 4
Statement of Cash Flows
for the nine months ended September 30, 1996 and 1995 5
Notes to the Financial Statements 6-8
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 9-12
PART II. OTHER INFORMATION:
Items 1 - 6 13
2
<PAGE>
AMERICAN INCOME PARTNERS V-D LIMITED PARTNERSHIP
STATEMENT OF FINANCIAL POSITION
September 30, 1996 and December 31, 1995
(Unaudited)
<TABLE>
<CAPTION>
September 30, December 31,
1996 1995
------------- ------------
<S> <C> <C>
ASSETS
Cash and cash equivalents $3,255,841 $1,108,982
Rents receivable 62,395 49,874
Accounts receivable - affiliate 69,376 130,677
Equipment at cost, net of accumulated depreciation
of $5,389,409 and $9,947,876 at September 30, 1996
and December 31, 1995, respectively 1,762,230 2,842,904
---------- ----------
Total assets $5,149,842 $4,132,437
---------- ----------
---------- ----------
LIABILITIES AND PARTNERS' CAPITAL
Notes payable $ 335,557 $ 86,802
Accrued interest 7,643 2,029
Accrued liabilities 18,750 20,000
Accrued liabilities - affiliate 5,044 11,673
Deferred rental income 201,138 203,248
Cash distributions payable to partners 1,829,918 252,751
---------- ----------
Total liabilities 2,398,050 576,503
---------- ----------
Partners' capital (deficit):
General Partner (394,463) (354,256)
Limited Partnership Interests
(480,227 Units; initial purchase price of $25 each) 3,146,255 3,910,190
---------- ----------
Total partners' capital 2,751,792 3,555,934
---------- ----------
Total liabilities and partners' capital $5,149,842 $4,132,437
---------- ----------
---------- ----------
</TABLE>
The accompanying notes are an integral part
of these financial statements.
3
<PAGE>
AMERICAN INCOME PARTNERS V-D LIMITED PARTNERSHIP
STATEMENT OF OPERATIONS
for the three and nine months ended September 30, 1996 and 1995
(Unaudited)
<TABLE>
<CAPTION>
Three Months Nine Months
Ended September 30, Ended September 30,
1996 1995 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Income:
Lease revenue $ 762,891 $523,410 $1,577,362 $1,627,330
Interest income 34,894 10,988 69,964 31,341
Gain on sale of equipment 474,581 119,552 530,328 124,998
---------- ---------- ---------- ----------
Total income 1,272,366 653,950 2,177,654 1,783,669
---------- ---------- ---------- ----------
Expenses:
Depreciation and amortization 142,954 336,818 619,178 1,142,753
Interest expense 7,643 9,944 7,643 53,635
Equipment management fees - affiliate 37,171 22,605 80,561 68,477
Operating expenses - affiliate 26,707 36,298 65,370 94,030
---------- ---------- ---------- ----------
Total expenses 214,475 405,665 772,752 1,358,895
---------- ---------- ---------- ----------
Net income $1,057,891 $248,285 $1,404,902 $ 424,774
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Net income
per limited partnership unit $ 2.09 $ 0.49 $ 2.78 $ 0.84
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
Cash distributions declared
per limited partnership unit $ 3.62 $ 0.50 $ 4.37 $ 1.50
---------- ---------- ---------- ----------
---------- ---------- ---------- ----------
</TABLE>
The accompanying notes are an integral part
of these financial statements.
4
<PAGE>
AMERICAN INCOME PARTNERS V-D LIMITED PARTNERSHIP
STATEMENT OF CASH FLOWS
for the nine months ended September 30, 1996 and 1995
(Unaudited)
<TABLE>
<CAPTION>
1996 1995
---- ----
<S> <C> <C>
Cash flows from (used in) operating activities:
Net income $1,404,902 $ 424,774
Adjustments to reconcile net income
to net cash from operating activities:
Depreciation and amortization 619,178 1,142,753
Gain on sale of equipment (530,328) (124,998)
Changes in assets and liabilities
Decrease (increase) in:
rents receivable (12,521) 79,179
accounts receivable - affiliate 61,301 54,520
Increase (decrease) in:
accrued interest 5,614 (11,156)
accrued liabilities (1,250) (1,750)
accrued liabilities - affiliate (6,629) (80,880)
deferred rental income (2,110) (19,909)
---------- ----------
Net cash from operating activities 1,538,157 1,462,533
---------- ----------
Cash flows from investing activities:
Proceeds from equipment sales 1,327,381 207,605
---------- ----------
Net cash from investing activities 1,327,381 207,605
---------- ----------
Cash flows used in financing activities:
Principal payments - notes payable (86,802) (838,076)
Distributions paid (631,877) (821,441)
---------- ----------
Net cash used in financing activities (718,679) (1,659,517)
---------- ----------
Net increase in cash and cash equivalents 2,146,859 10,621
Cash and cash equivalents at beginning of period 1,108,982 896,516
---------- ----------
Cash and cash equivalents at end of period $3,255,841 $ 907,137
---------- ----------
---------- ----------
Supplemental disclosure of cash flow information:
Cash paid during the period for interest $ 2,029 $ 64,791
---------- ----------
---------- ----------
Supplemental disclosure of non-cash investing and financing activities:
See Note 4 to the Financial Statements.
</TABLE>
The accompanying notes are an integral part
of these financial statements.
5
<PAGE>
AMERICAN INCOME PARTNERS V-D LIMITED PARTNERSHIP
Notes to the Financial Statements
September 30, 1996
(Unaudited)
NOTE 1 - BASIS OF PRESENTATION
The financial statements presented herein are prepared in conformity
with generally accepted accounting principles and the instructions for
preparing Form 10-Q under Rule 10-01 of Regulation S-X of the Securities and
Exchange Commission and are unaudited. As such, these financial statements
do not include all information and footnote disclosures required under
generally accepted accounting principles for complete financial statements
and, accordingly, the accompanying financial statements should be read in
conjunction with the footnotes presented in the 1995 Annual Report. Except
as disclosed herein, there has been no material change to the information
presented in the footnotes to the 1995 Annual Report.
In the opinion of management, all adjustments (consisting of normal and
recurring adjustments) considered necessary to present fairly the financial
position at September 30, 1996 and December 31, 1995 and results of
operations for the three and nine month periods ended September 30, 1996 and
1995 have been made and are reflected.
NOTE 2 - CASH
At September 30, 1996, the Partnership had $3,135,000 invested in
reverse repurchase agreements secured by U.S. Treasury Bills or interests in
U.S. Government securities.
NOTE 3 - REVENUE RECOGNITION
Rents are payable to the Partnership monthly, quarterly or semi-annually
and no significant amounts are calculated on factors other than the passage
of time. The leases are accounted for as operating leases and are
noncancellable. Rents received prior to their due dates are deferred. Future
minimum rents of $616,424 are due as follows:
For the year ending September 30, 1997 $257,221
1998 120,639
1999 86,528
2000 84,778
2001 67,258
---------
Total $616,424
---------
---------
NOTE 4 - EQUIPMENT
The following is a summary of equipment owned by the Partnership at
September 30, 1996. In the opinion of American Finance Group ("AFG"), the
acquisition cost of the equipment did not exceed its fair market value.
6
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AMERICAN INCOME PARTNERS V-D LIMITED PARTNERSHIP
Notes to the Financial Statements
(Continued)
Lease Term Equipment
Equipment Type (Months) at Cost
- ------------------------------------- ---------- ----------
Locomotives 78 $1,656,854
Materials handling 1-60 1,582,923
Aircraft 1-19 1,160,990
Furniture and fixtures 60-84 686,786
Computers and peripherals 12-60 371,579
Construction and mining 12-60 364,308
Trailers and intermodal containers 12-60 357,884
Tractors and heavy duty trucks 24-60 301,746
Manufacturing 60 268,764
Communications 23-60 229,633
Research and test 9-24 105,805
Motor vehicles 60 64,367
----------
Total equipment cost 7,151,639
Accumulated depreciation (5,389,409)
----------
Equipment, net of accumulated depreciation $1,762,230
----------
----------
During the three months ended March 31, 1996 the Partnership transferred
its ownership interest in a trailer, previously leased to The Atchison Topeka
and Santa Fe Railroad, having a net book value of $6,787, to a third party
for cash consideration of $8,750 which resulted in a net gain of $1,963. The
gain was deferred in anticipation of completing a like-kind exchange during
the three months ended June 30, 1996. The Partnership intended to replace
this trailer with a comparable trailer and lease such equipment to a new
lessee. The Partnership had accounted for this transaction as a like-kind
exchange for income tax reporting purposes. Accordingly, the net cash
consideration of $8,750 was deposited in a special-purpose escrow account
through a third-party Exchange Agent pending completion of the equipment
exchange. The Partnership subsequently elected not to replace the trailer
and, accordingly, the deferred gain of $1,963 was recognized as Gain on Sale
of Equipment on the Statement of Operations during the second quarter of
1996. In addition, the cash consideration of $8,750, which was reported as
Contractual Right for Equipment on the Statement of Financial Position at
March 31, 1996, was recognized as proceeds from equipment sales.
During July 1996, the Partnership transferred its ownership interest in
certain additional trailers, previously leased to The Atchison Topeka and
Santa Fe Railroad, to a third party for cash consideration of $60,170. The
trailers had a net book value of $22,808 at the time of the transfer, which
resulted in a net gain of $37,362. In September 1996, the Partnership
replaced these trailers with comparable trailers and leased such to a new
lessee. The transaction was accounted for as a like-kind exchange for income
tax reporting purposes. The cost of the new trailers, $357,884, was reduced
by $36,574, representing the proportionate amount of gain deferred on the
original trailers. The Partnership funded this transaction with $58,901 of
cash consideration and long-term financing of $335,557. The unused cash
consideration of $1,269 was recognized as proceeds from equipment sales. The
associated deferred gain of $788 was recognized as Gain on Sale of Equipment
on the Statement of Operations for the three months ended September 30, 1996.
At September 30, 1996, the Partnership's equipment portfolio included
equipment having a proportionate original cost of $2,989,926 representing
approximately 42% of total equipment cost.
7
<PAGE>
AMERICAN INCOME PARTNERS V-D LIMITED PARTNERSHIP
Notes to the Financial Statements
(Continued)
The summary above includes equipment held for sale or re-lease with an
original cost and net book value of approximately $1,696,000 and $482,000,
respectively, at September 30, 1996. The General Partner is actively seeking
the sale or re-lease of all equipment not on lease.
NOTE 5 - RELATED PARTY TRANSACTIONS
All operating expenses incurred by the Partnership are paid by AFG on
behalf of the Partnership and AFG is reimbursed at its actual cost for such
expenditures. Fees and other costs incurred during each of the nine month
periods ended September 30, 1996 and 1995, which were paid or accrued by the
Partnership to AFG or its Affiliates, are as follows:
1996 1995
---- ----
Equipment management fees $ 80,561 $ 68,477
Administrative charges 15,408 15,408
Reimbursable operating expenses
due to third parties 49,962 78,622
-------- --------
Total $145,931 $162,507
-------- --------
-------- --------
All rents and proceeds from the sale of equipment are paid directly to
either AFG or to a lender. AFG temporarily deposits collected funds in a
separate interest-bearing escrow account prior to remittance to the
Partnership. At September 30, 1996, the Partnership was owed $69,376 by AFG
for such funds and the interest thereon. These funds were remitted to the
Partnership in October 1996.
NOTE 6 - NOTES PAYABLE
Notes payable at September 30, 1996 consisted of installment notes
payable to banks of $335,557. The installment notes are non-recourse, with
interest rates ranging between 9.75% and 9.9% and are collateralized by the
equipment and assignment of the related lease payments. All of the notes
were originated in connection with the like-kind exchange transaction (see
Note 4) and will be fully amortized by noncancellable rents. The carrying
amount of notes payable approximates fair value at September 30, 1996.
The annual maturities of the installment notes payable are as follows:
For the year ending September 30, 1997 $ 68,030
1998 61,189
1999 64,438
2000 77,461
2001 64,439
--------
Total $335,557
--------
--------
8
<PAGE>
AMERICAN INCOME PARTNERS V-D LIMITED PARTNERSHIP
FORM 10-Q
PART I. FINANCIAL INFORMATION
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1996 COMPARED TO THE THREE AND NINE
MONTHS ENDED SEPTEMBER 30, 1995:
OVERVIEW
As an equipment leasing partnership, the Partnership was organized to
acquire a diversified portfolio of capital equipment subject to lease
agreements with third parties. The Partnership was designed to progress
through three principal phases: acquisitions, operations, and liquidation.
During the operations phase, a period of approximately six years, all
equipment in the Partnership's portfolio will progress through various
stages. Initially, all equipment will generate rental revenues under primary
term lease agreements. During the life of the Partnership, these agreements
will expire on an intermittent basis and equipment held pursuant to the
related leases will be renewed, re-leased or sold, depending on prevailing
market conditions and the assessment of such conditions by AFG to obtain the
most advantageous economic benefit. Over time, a greater portion of the
Partnership's original equipment portfolio will become available for
remarketing and cash generated from operations and from sales or refinancings
will begin to fluctuate. Ultimately, all equipment will be sold and the
Partnership will be dissolved. The Partnership's operations commenced in
1990.
RESULTS OF OPERATIONS
For the three and nine months ended September 30, 1996, the Partnership
recognized lease revenue of $762,891 and $1,577,362, respectively, compared
to $523,410 and $1,627,330 for the same periods in 1995. Lease revenue
increased during the three months ended September 30, 1996, due to the
receipt of $516,712 of lease termination rents received in connection with
the sale of the Partnership's interest in two Boeing 727-251 Advanced
aircraft in July 1996 (see discussion below). The overall decrease in lease
revenue from 1995 to 1996 was expected and resulted principally from primary
lease term expirations and the sale of equipment. The Partnership also earns
interest income from temporary investments of rental receipts and equipment
sales proceeds in short-term instruments.
The Partnership's equipment portfolio includes certain assets in which
the Partnership holds a proportionate ownership interest. In such cases, the
remaining interests are owned by AFG or an affiliated equipment leasing
program sponsored by AFG. Proportionate equipment ownership enables the
Partnership to further diversify its equipment portfolio by participating in
the ownership of selected assets, thereby reducing the general levels of risk
which could result from a concentration in any single equipment type,
industry or lessee. The Partnership and each affiliate individually report,
in proportion to their respective ownership interests, their respective
shares of assets, liabilities, revenues, and expenses associated with the
equipment.
For the three and nine months ended September 30, 1996, the Partnership
sold equipment having a net book value of $752,405 and $789,785,
respectively, to existing lessees and third parties. These sales resulted in
net gains for financial statement purposes of $473,793 and $527,577,
respectively. These equipment sales included the sale of the Partnership's
interest in two Boeing 727-251 Advanced aircraft with an original cost and
net book value of $4,536,732 and $740,021, respectively, sold to the existing
lessee in July 1996. In connection with this sale, the Partnership realized
sale proceeds of $1,195,994, which resulted in a net gain, for financial
statement purposes, of $455,973. This equipment was sold prior to the
expiration of the related lease term, resulting in the receipt by the
Partnership of lease termination rents, described above.
9
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AMERICAN INCOME PARTNERS V-D LIMITED PARTNERSHIP
FORM 10-Q
PART I. FINANCIAL INFORMATION
During the three months ended March 31, 1996, the Partnership
transferred its ownership interest in a trailer previously leased to The
Atchison Topeka and Santa Fe Railroad. The Partnership intended to replace
the trailer with a comparable trailer and account for the transaction as a
like-kind exchange for income tax reporting purposes. A gain of $1,963, was
deferred in anticipation of completing the exchange during the three months
ended June 30, 1996. The Partnership subsequently elected not to replace the
trailer and, accordingly, the deferred gain of $1,963 was recognized as Gain
on Sale of Equipment on the Statement of Operations during the second quarter
of 1996.
During July 1996, the Partnership transferred its ownership interest in
certain additional trailers to a third party for cash consideration of
$60,170 (See Note 4 to the financial statements). The trailers had a net
book value of $22,808 at the time of the transfer, resulting in a net gain of
$37,362. In September 1996, the Partnership replaced these trailers with
comparable trailers and leased such to a new lessee. The transaction was
accounted for as a like-kind exchange for income tax reporting purposes. The
cost of the new trailers, $357,884, was reduced by $36,574, representing the
proportionate amount of gain deferred on the original trailers. The
Partnership funded this transaction with $58,901 of cash consideration and
long-term financing of $335,557. The unused cash consideration of $1,269 was
recognized as proceeds from equipment sales. The associated deferred gain of
$788 was recognized as Gain on Sale of Equipment on the Statement of
Operations for the three months ended September 30, 1996.
For the three and nine months ended September 30, 1995, the Partnership
sold equipment having a net book value of $51,299 and $82,607, respectively,
to existing lessees and third parties. These sales resulted in net gains,
for financial statement purposes, of $119,552 and $124,998, respectively.
It cannot be determined whether future sales of equipment will result in
a net gain or a net loss to the Partnership, as such transactions will be
dependent upon the condition and type of equipment being sold and its
marketability at the time of sale. In addition, the amount of gain or loss
reported for financial statement purposes is partly a function of the amount
of accumulated depreciation associated with the equipment being sold.
The ultimate realization of residual value for any type of equipment is
dependent upon many factors, including AFG's ability to sell and re-lease
equipment. Changing market conditions, industry trends, technological
advances, and many other events can converge to enhance or detract from asset
values at any given time. AFG attempts to monitor these changes in order to
identify opportunities which may be advantageous to the Partnership and which
will maximize total cash returns for each asset.
The total economic value realized upon final disposition of each asset
is comprised of all primary lease term revenue generated from that asset,
together with its residual value. The latter consists of cash proceeds
realized upon the asset's sale in addition to all other cash receipts
obtained from renting the asset on a re-lease, renewal or month-to-month
basis. The Partnership classifies such residual rental payments as lease
revenue. Consequently, the amount of gain or loss reported in the financial
statements is not necessarily indicative of the total residual value the
Partnership achieved from leasing the equipment.
Depreciation and amortization expense was $142,954 and $619,178 for the
three and nine months ended September 30, 1996, respectively, compared to
$336,818 and $1,142,753 for the same periods in 1995. For financial
reporting purposes, to the extent that an asset is held on primary lease
term, the Partnership depreciates the difference between (i) the cost of the
asset and (ii) the estimated residual value of the asset on a straight-line
basis over such term. For purposes of this policy, estimated residual values
represent estimates of equipment values at the date of primary lease
expiration. To the extent that an asset is held beyond its primary lease
term,
10
<PAGE>
AMERICAN INCOME PARTNERS V-D LIMITED PARTNERSHIP
FORM 10-Q
PART I. FINANCIAL INFORMATION
the Partnership continues to depreciate the remaining net book value of the
asset on a straight-line basis over the asset's remaining economic life.
Interest expense was $7,643 during each of the three and nine months
ended September 30, 1996 (1% and less than 1% of lease revenue for the
respective periods). In 1995, interest expense was $9,944 and $53,635 or
1.9% and 3.3% of lease revenue for the same periods. Interest expense in
1996 resulted from financing obtained from a third-party lender in connection
with the like-kind exchange transaction which occurred during the three
months ended September 30, 1996, described above. Interest expense in future
periods will decline as the principal balance of notes payable is reduced
through the application of rent receipts to outstanding debt.
Management fees were 4.9% and 5.1% of lease revenue for the three and
nine months ended September 30, 1996, respectively, compared to 4.3% and 4.2%
of lease revenue for the same periods in 1995. Management fees during the
nine months ended September 30, 1996 include $4,617, resulting from an
underaccrual in 1995. Management fees are based on 5% of gross lease revenue
generated by operating leases and 2% of gross lease revenue generated by full
payout leases.
Operating expenses consist principally of administrative charges,
professional service costs, such as audit and legal fees, as well as
printing, distribution and remarketing expenses. In certain cases, equipment
storage or repairs and maintenance costs may be incurred in connection with
equipment being remarketed. Collectively, operating expenses represented
3.5% and 4.1% of lease revenue for the three and nine months ended September
30, 1996, respectively, compared to 6.9% and 5.8%, respectively, of lease
revenue for the same periods in 1995. The amount of future operating
expenses cannot be predicted with certainty; however, such expenses are
usually higher during the acquisition and liquidation phases of a
partnership. Other fluctuations typically occur in relation to the volume
and timing of remarketing activities.
LIQUIDITY AND CAPITAL RESOURCES AND DISCUSSION OF CASH FLOWS
The Partnership by its nature is a limited life entity which was
established for specific purposes described in the preceding "Overview". As
an equipment leasing program, the Partnership's principal operating
activities derive from asset rental transactions. Accordingly, the
Partnership's principal source of cash from operations is provided by the
collection of periodic rents. These cash inflows are used to satisfy debt
service obligations associated with leveraged leases, and to pay management
fees and operating costs. Operating activities generated net cash inflows of
$1,538,157 and $1,462,533 for the nine months ended September 30, 1996 and
1995, respectively. Future renewal, re-lease and equipment sale activities
will cause a decline in the Partnership's lease revenue and corresponding
sources of operating cash. Overall, expenses associated with rental
activities, such as management fees, and net cash flow from operating
activities will also decline as the Partnership experiences a higher
frequency of remarketing events.
Ultimately, the Partnership will dispose of all assets under lease.
This will occur principally through sale transactions whereby each asset will
be sold to the existing lessee or to a third party. Generally, this will
occur upon expiration of each asset's primary or renewal/re-lease term. In
certain instances, casualty or early termination events may result in the
disposal of an asset. Such circumstances are infrequent and usually result
in the collection of stipulated cash settlements pursuant to terms and
conditions contained in the underlying lease agreements.
Cash realized from asset disposal transactions is reported under
investing activities on the accompanying Statement of Cash Flows. During the
nine months ended September 30, 1996, the Partnership realized
11
<PAGE>
AMERICAN INCOME PARTNERS V-D LIMITED PARTNERSHIP
FORM 10-Q
PART I. FINANCIAL INFORMATION
$1,327,381 in equipment sale proceeds compared to $207,605 for the same
period in 1995. Future inflows of cash from asset disposals will vary in
timing and amount and will be influenced by many factors including, but not
limited to, the frequency and timing of lease expirations, the type of
equipment being sold, its condition and age, and future market conditions.
The Partnership obtained long-term financing in connection with certain
equipment leases. The repayments of principal related to such indebtedness
is reported as a component of financing activities. Each note payable is
recourse only to the specific equipment financed and to the minimum rental
payments contracted to be received during the debt amortization period (which
period generally coincides with the lease rental term). As rental payments
are collected, a portion or all of the rental payment is used to repay the
associated indebtedness. In September 1996, the Partnership obtained
additional long-term financing in connection with the like-kind exchange
transaction involving certain trailers (see Results of Operations).
Cash distributions to the General Partner and Recognized Owners are
declared and generally paid within fifteen days following the end of each
calendar quarter. The payment of such distributions is presented as a
component of financing activities. For the nine months ended September 30,
1996, the Partnership declared total cash distributions of Distributable Cash
From Operations and Distributable Cash From Sales and Refinancings of
$2,209,044. In accordance with the Amended and Restated Agreement and
Certificate of Limited Partnership, the Recognized Owners were allocated 95%
of these distributions, or $2,098,592, and the General Partner was allocated
5%, or $110,452. The third quarter 1996 cash distribution was paid on
October 15, 1996.
Cash distributions paid to the Recognized Owners consist of both a
return of and a return on capital. To the extent that cash distributions
consist of Cash From Sales or Refinancings, substantially all of such cash
distributions should be viewed as a return of capital. Cash distributions do
not represent and are not indicative of yield on investment. Actual yield on
investment cannot be determined with any certainty until conclusion of the
Partnership and will be dependent upon the collection of all future
contracted rents, the generation of renewal and/or re-lease rents, and the
residual value realized for each asset at its disposal date. Future market
conditions, technological changes, the ability of AFG to manage and remarket
the assets, and many other events and circumstances, could enhance or detract
from individual asset yields and the collective performance of the
Partnership's equipment portfolio.
The future liquidity of the Partnership will be influenced by the
foregoing and will be greatly dependent upon the collection of contractual
rents and the outcome of residual activities. The General Partner
anticipates that cash proceeds resulting from these sources will satisfy the
Partnership's future expense obligations. However, the amount of cash for
distribution in future periods will fluctuate. Equipment lease expirations
and asset disposals will cause the Partnership's net cash from operating
activities to diminish over time; and equipment sale proceeds will vary in
amount and period of realization. In addition, the Partnership may be
required to incur asset refurbishment or upgrade costs in connection with
future remarketing activities. Accordingly, fluctuations in the level of
quarterly cash distributions will occur during the life of the Partnership.
12
<PAGE>
AMERICAN INCOME PARTNERS V-D LIMITED PARTNERSHIP
FORM 10-Q
PART II. OTHER INFORMATION
Item 1. Legal Proceedings
Response: None
Item 2. Changes in Securities
Response: None
Item 3. Defaults upon Senior Securities
Response: None
Item 4. Submission of Matters to a Vote of Security Holders
Response: None
Item 5. Other Information
Response: None
Item 6(a). Exhibits
Response: None
Item 6(b). Reports on Form 8-K
Response: None
13
<PAGE>
SIGNATURE PAGE
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below on behalf of the registrant and in the
capacity and on the date indicated.
AMERICAN INCOME PARTNERS V-D LIMITED PARTNERSHIP
By: AFG Leasing IV Incorporated, a Massachusetts
corporation and the General Partner of the
Registrant.
By: /s/ Michael J. Butterfield
-----------------------------------
Michael J. Butterfield
Treasurer of AFG Leasing IV Incorporated
(Duly Authorized Officer and
Principal Accounting Officer)
Date: November 14, 1996
-----------------------------------
By: /s/ Gary M. Romano
-----------------------------------
Gary M. Romano
Clerk of AFG Leasing IV Incorporated
(Duly Authorized Officer and
Principal Financial Officer)
Date: November 14, 1996
-----------------------------------
14
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JAN-01-1996
<PERIOD-END> SEP-30-1996
<CASH> 3,255,841
<SECURITIES> 0
<RECEIVABLES> 131,771
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 3,387,612
<PP&E> 7,151,639
<DEPRECIATION> 5,389,409
<TOTAL-ASSETS> 5,149,842
<CURRENT-LIABILITIES> 2,062,493
<BONDS> 335,557
0
0
<COMMON> 0
<OTHER-SE> 2,751,792
<TOTAL-LIABILITY-AND-EQUITY> 5,149,842
<SALES> 1,577,362
<TOTAL-REVENUES> 2,177,654
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 765,109
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 7,643
<INCOME-PRETAX> 1,404,902
<INCOME-TAX> 0
<INCOME-CONTINUING> 1,404,902
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<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 1,404,902
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
