<PAGE>
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended June 30, 1998.
-------------
[_] 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: 0-18133
IDS/JONES GROWTH PARTNERS II, L.P.
- --------------------------------------------------------------------------------
Exact name of registrant as specified in charter
Colorado #84-1060548
- --------------------------------------------------------------------------------
State of organization I.R.S. employer I.D. #
9697 East Mineral Avenue, P.O. Box 3309, Englewood, Colorado 80155-3309
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Address of principal executive office
(303) 792-3111
----------------------------------
Registrant's telephone number
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
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IDS/JONES GROWTH PARTNERS II, L. P.
-----------------------------------
(A Limited Partnership)
UNAUDITED CONSOLIDATED BALANCE SHEETS
-------------------------------------
<TABLE>
<CAPTION>
June 30, December 31,
ASSETS 1998 1997
------ ------------- -------------
<S> <C> <C>
CASH $ 98,323 $ 124,766
TRADE RECEIVABLES, less allowance for doubtful receivables
of $148,558 and $91,156 at June 30, 1998 and December 31,
1997, respectively 565,921 565,702
INVESTMENT IN CABLE TELEVISION PROPERTIES:
Property, plant and equipment, at cost 49,269,619 47,080,064
Less - accumulated depreciation (25,705,025) (23,938,318)
------------ ------------
23,564,594 23,141,746
Franchise costs and other intangible assets, net of accumulated
amortization of $57,997,118 and $55,831,988, at June 30, 1998
and December 31, 1997, respectively 15,700,877 17,866,007
------------ ------------
Total investment in cable television properties 39,265,471 41,007,753
DEPOSITS, PREPAID EXPENSES AND DEFERRED CHARGES 342,755 463,878
------------ ------------
Total assets $ 40,272,470 $ 42,162,099
============ ============
</TABLE>
The accompanying notes to unaudited consolidated financial statements
are an integral part of these unaudited consolidated balance sheets.
2
<PAGE>
IDS/JONES GROWTH PARTNERS II, L. P.
-----------------------------------
(A Limited Partnership)
UNAUDITED CONSOLIDATED BALANCE SHEETS
-------------------------------------
<TABLE>
<CAPTION>
June 30, December 31,
1998 1997
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LIABILITIES AND PARTNERS' DEFICIT
---------------------------------
<S> <C> <C>
LIABILITIES:
Debt $ 50,079,400 $ 50,093,792
Managing General Partner advances 337,169 343,974
Trade accounts payable and accrued liabilities 3,843,233 3,342,658
Subscriber prepayments 51,484 58,915
------------ ------------
Total liabilities 54,311,286 53,839,339
------------ ------------
MINORITY INTEREST IN JOINT VENTURE (4,917,280) (4,104,898)
------------ ------------
PARTNERS' DEFICIT:
General Partners-
Contributed capital 500 500
Accumulated deficit (467,147) (451,655)
------------ ------------
(466,647) (451,155)
------------ ------------
Limited Partners-
Net contributed capital (174,343 units outstanding
at June 30, 1998 and December 31, 1997) 37,256,546 37,256,546
Accumulated deficit (45,911,435) (44,377,733)
------------ ------------
(8,654,889) (7,121,187)
------------ ------------
Total liabilities and partners' deficit $ 40,272,470 $ 42,162,099
============ ============
</TABLE>
The accompanying notes to unaudited consolidated financial statements
are an integral part of these unaudited consolidated balance sheets.
3
<PAGE>
IDS/JONES GROWTH PARTNERS II, L. P.
-----------------------------------
(A Limited Partnership)
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
-----------------------------------------------
<TABLE>
<CAPTION>
For the Three Months Ended For the Six Months Ended
June 30, June 30,
--------------------------- -------------------------
1998 1997 1998 1997
------------ ------------ ----------- -----------
<S> <C> <C> <C> <C>
REVENUES $ 5,484,098 $ 4,929,109 $10,622,039 $ 9,641,555
COSTS AND EXPENSES:
Operating expenses 2,977,427 2,694,604 5,757,426 5,400,456
Management and supervision fees
and allocated overhead from
General Partners 631,168 519,121 1,208,607 1,090,031
Depreciation and amortization 2,160,854 2,349,158 4,105,942 4,798,663
----------- ----------- ----------- -----------
OPERATING LOSS (285,351) (633,774) (449,936) (1,647,595)
----------- ----------- ----------- -----------
OTHER INCOME (EXPENSE):
Interest expense (949,601) (917,103) (1,894,764) (1,825,055)
Other, net (14,120) (21,537) (16,876) (13,441)
----------- ----------- ----------- -----------
Total other income (expense), net (963,721) (938,640) (1,911,640) (1,838,496)
----------- ----------- ----------- -----------
CONSOLIDATED LOSS (1,249,072) (1,572,414) (2,361,576) (3,486,091)
MINORITY INTEREST IN
CONSOLIDATED LOSS 429,681 540,911 812,382 1,199,216
----------- ----------- ----------- -----------
NET LOSS $ (819,391) $(1,031,503) $(1,549,194) $(2,286,875)
=========== =========== =========== ===========
ALLOCATION OF NET LOSS:
General Partners $ (8,194) $ (10,315) $ (15,492) $ (22,869)
=========== =========== =========== ===========
Limited Partners $ (811,197) $(1,021,188) $(1,533,702) $(2,264,006)
=========== =========== =========== ===========
NET LOSS PER LIMITED
PARTNERSHIP UNIT $(4.66) $(5.86) $(8.80) $(12.99)
=========== =========== =========== ===========
WEIGHTED AVERAGE NUMBER OF
LIMITED PARTNERSHIP UNITS
OUTSTANDING 174,343 174,343 174,343 174,343
=========== =========== =========== ===========
</TABLE>
The accompanying notes to unaudited consolidated financial statements
are an integral part of these unaudited consolidated statements.
4
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IDS/JONES GROWTH PARTNERS II, L. P.
-----------------------------------
(A Limited Partnership)
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
-----------------------------------------------
<TABLE>
<CAPTION>
For the Six Months Ended
June 30,
--------------------------
1998 1997
------------ ------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $(1,549,194) $(2,286,875)
Adjustments to reconcile net loss to net cash provided
by operating activities:
Depreciation and amortization 4,105,942 4,798,663
Minority interest in consolidated loss (812,382) (1,199,216)
Decrease (increase) in trade receivables (219) 280,445
Increase in deposits, prepaid expenses and
deferred charges (52,982) (186,881)
Increase in accrued liabilities and subscriber
prepayments 493,144 491,676
Decrease in advances from Managing General Partner (6,805) (96,206)
----------- -----------
Net cash provided by operating activities 2,177,504 1,801,606
----------- -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment, net (2,189,555) (1,735,523)
----------- -----------
Net cash used in investing activities (2,189,555) (1,735,523)
----------- -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings - 31,266
Repayment of debt (14,392) (16,215)
----------- -----------
Net cash provided by (used in) financing activities (14,392) 15,051
----------- -----------
Increase (decrease) in cash (26,443) 81,134
Cash, beginning of period 124,766 39,236
----------- -----------
Cash, end of period $ 98,323 $ 120,370
=========== ===========
SUPPLEMENTAL CASH FLOW DISCLOSURE:
Interest paid $ 1,746,469 $ 2,141,628
=========== ===========
</TABLE>
The accompanying notes to unaudited consolidated financial statements
are an integral part of these unaudited consolidated statements.
5
<PAGE>
IDS/JONES GROWTH PARTNERS II, L. P.
-----------------------------------
(A Limited Partnership)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
----------------------------------------------------
(1) This Form 10-Q is being filed in conformity with the SEC requirements
for unaudited financial statements and does not contain all of the necessary
footnote disclosures required for a complete presentation of the Balance Sheets
and Statements of Operations and Cash Flows in conformity with generally
accepted accounting principles. However, in the opinion of management, this data
includes all adjustments, consisting only of normal recurring accruals,
necessary to present fairly the financial position of IDS/Jones Growth Partners
II, L.P. (the "Partnership") at June 30, 1998 and December 31, 1997, its
Statements of Operations for the three and six month periods ended June 30, 1998
and 1997 and its Statements of Cash Flows for the six month periods ended June
30, 1998 and 1997. Results of operations for these periods are not necessarily
indicative of results to be expected for the full year.
The Partnership owns a 65.6 percent interest in IDS/Jones Joint Venture
Partners (the "Venture") through capital contributions of $37,592,709. The
Venture acquired the cable television system serving the communities of Aurora,
North Aurora, Montgomery, Plano, Oswego, Sandwich, Yorkville and certain
unincorporated areas of Kendall and Kane Counties, all in the State of Illinois
(the "Aurora System") on May 31, 1990.
The accompanying financial statements include 100 percent of the accounts
of the Partnership and those of the Venture reduced by the minority interests in
the Venture. All interpartnership accounts and transactions have been
eliminated.
(2) In July 1998, the Venture entered into an asset purchase agreement to sell
the Aurora System to an unaffiliated party for a sales price of $108,500,000,
subject to customary closing adjustments. Closing of the sale, which is expected
to occur in the fourth quarter of 1998, will be subject to several conditions,
including necessary governmental and other third party consents. In addition,
because the Aurora System constitutes all of the assets of the Partnership and
IDS/Jones Growth Partners 89-B, Ltd. ("89-B"), the sale must be approved by the
owners of a majority of the interests of both the Partnership and 89-B. Jones
Cable Corporation (the "Managing General Partner") expects to conduct a vote of
the limited partners of the Partnership and 89-B on the sale of the Aurora
System in the third quarter of 1998. IDS Cable II Corporation (the "Supervising
General Partner") has consented to the transaction. Upon the closing of the
proposed sale of the Aurora System, based upon financial information as of June
30, 1998, the Venture will repay all of its indebtedness, including $47,000,000
borrowed under its credit facility, capital lease obligations totaling $72,753,
related parties' notes totaling $1,600,000 and the subordinated advance of
$1,406,647 to Jones Intercable, Inc. ("JIC"), settle working capital
adjustments, and then deposit $3,283,500 into an indemnity escrow account. The
remaining net sale proceeds of approximately $52,000,000 will be distributed to
the Venture's four partners: the Partnership, 89-B, IDS Management Corporation
and JIC, in proportion to their ownership interests. The Partnership will
receive $34,100,000, or 65.6 percent of the $52,000,000 distribution, which the
Partnership will distribute to its partners of record as of the closing date of
the sale of the Aurora System. Based upon financial information as of June 30,
1998, this distribution will give the Partnership's limited partners an
approximate return of $196 for each $250 limited partnership interest, or $784
for each $1,000 invested in the Partnership.
The $3,283,500 of the sale proceeds to be placed in the indemnity escrow
account will remain in escrow until November 15, 1999 as security for the
Partnership's agreement to indemnify the buyer under the asset purchase
agreement. The Partnership's primary exposure, if any, will relate to the
representations and warranties to be made about the Aurora System in the asset
purchase agreement. Any amounts remaining from this indemnity escrow account
and not claimed by the buyer at the end of the escrow period will be returned to
and distributed to the Partnership, 89-B, IDS Management Corporation and JIC.
If the entire $3,283,500 escrow amount is distributed, the Partnership would
receive approximately $2,153,976, or 65.6 percent. The Partnership would then
distribute the $2,153,976 to the limited partners, which would represent $12.50
for each $250 limited partnership interest or $50 for each $1,000 invested in
the Partnership. The Partnership will continue in existence at least until any
amounts remaining from the indemnity escrow account have been distributed.
Since the Aurora System represents the only asset of the Partnership and the
Venture, the Partnership and the Venture will be liquidated and dissolved upon
the final distribution of any amounts remaining from the indemnity escrow
account. If any disputes with respect to the indemnification arise, the
Partnership and the Venture would not be dissolved until such disputes were
resolved, which could result in the Partnership and the Venture continuing in
existence beyond 1999.
6
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(3) The Managing General Partner manages the Partnership and the Venture and
receives a fee for its services equal to 5 percent of the gross revenues of the
Venture, excluding revenues from the sale of cable television systems or
franchises. Management fees paid to the Managing General Partner for the three
and six month periods ended June 30, 1998 were $274,205 and $531,102,
respectively, compared to $246,456 and $482,078, respectively, for the three and
six month periods ended June 30, 1997.
The Supervising General Partner and IDS Cable Corporation (the supervising
general partner of 89-B) participate in certain management decisions of the
Venture and receive a fee for their services equal to 1/2 percent of the gross
revenues of the Venture, excluding revenues from the sale of cable television
systems or franchises. Supervision fees for the three and six month periods
ended June 30, 1998 were $27,420 and $53,110, respectively, compared to $24,646
and $48,208, respectively, for the three and six month periods ended June 30,
1997.
The Venture reimburses JIC, the parent of the Managing General Partner, for
certain allocated overhead and administrative expenses. These expenses
represent the salaries and related benefits paid for corporate personnel, rent,
data processing services and other corporate facilities costs. Such personnel
provide engineering, marketing, administrative, accounting, legal and investor
relations services to the Venture. Such services, and their related costs, are
necessary to the operations of the Venture and would have been incurred by the
Venture if it was a stand alone entity. Allocations of personnel costs are
based on actual time spent by employees of JIC with respect to each partnership
managed. Remaining expenses are allocated based on the pro rata relationship of
the Venture's revenues to the total revenues of all systems owned or managed by
JIC and certain of its affiliates. Systems owned by JIC and all other systems
owned by partnerships for which JIC or affiliates are the general partners are
also allocated a proportionate share of these expenses. JIC believes that the
methodology used in allocating overhead and administrative expenses is
reasonable. Reimbursements made to JIC by the Venture for allocated overhead
and administrative expenses during the three and six month periods ended June
30, 1998 were $329,543 and $624,395, respectively, compared to $248,019 and
$559,745, respectively, for the three and six month periods ended June 30, 1997.
The Supervising General Partners may also be reimbursed for certain
expenses incurred on behalf of the Venture. There were no reimbursements made
to the Supervising General Partners for allocated overhead and administrative
expenses during the three and six month periods ended June 30, 1998 and 1997.
7
<PAGE>
IDS/JONES GROWTH PARTNERS II, L. P.
-----------------------------------
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
---------------------------------------------------------------
RESULTS OF OPERATIONS
---------------------
FINANCIAL CONDITION
- -------------------
The Partnership owns a 65.6 percent interest in the Venture. The
accompanying financial statements include the accounts of the Partnership and
the Venture, reduced by the 34.4 percent minority interest in the Venture. The
Venture owns the Aurora System.
On December 5, 1991, JIC made an equity investment in the Venture in the
amount of $2,872,000. Also on December 5, 1991, IDS Management Corporation made
an equity investment in the Venture of $2,872,000. As a result of their equity
contributions to the Venture, IDS Management Corporation and JIC each have a 5
percent equity interest in the Venture, the Partnership has a 65.6 percent
interest and 89-B has a 24.4 percent interest.
In July 1998, the Venture entered into an asset purchase agreement to sell
the Aurora System to an unaffiliated party for a sales price of $108,500,000,
subject to customary closing adjustments. Closing of the sale, which is
expected to occur in the fourth quarter of 1998, will be subject to several
conditions, including necessary governmental and other third party consents. In
addition, because the Aurora System constitutes all of the assets of the
Partnership and 89-B, the sale must be approved by the owners of a majority of
the interests of both the Partnership and 89-B. Jones Cable Corporation (the
"Managing General Partner") expects to conduct a vote of the limited partners of
the Partnership and 89-B on the sale of the Aurora System in the third quarter
of 1998. The Supervising General Partner has consented to the transaction.
Upon the closing of the proposed sale of the Aurora System, based upon financial
information as of June 30, 1998, the Venture will repay all of its indebtedness,
including $47,000,000 borrowed under its credit facility, capital lease
obligations totaling $72,753, related parties' notes totaling $1,600,000 and the
subordinated advance of $1,406,647 to JIC, settle working capital adjustments,
and then deposit $3,283,500 into an indemnity escrow account. The remaining net
sale proceeds of approximately $52,000,000 will be distributed to the Venture's
four partners: the Partnership, 89-B, IDS Management Corporation and JIC, in
proportion to their ownership interests. The Partnership will receive
$34,100,000, or 65.6 percent of the $52,000,000 distribution, which the
Partnership will distribute to its partners of record as of the closing date of
the sale of the Aurora System. Based upon financial information as of June 30,
1998, this distribution will give the Partnership's limited partners an
approximate return of $196 for each $250 limited partnership interest, or $784
for each $1,000 invested in the Partnership.
The $3,283,500 of the sale proceeds to be placed in the indemnity escrow
account will remain in escrow until November 15, 1999 as security for the
Partnership's agreement to indemnify the buyer under the asset purchase
agreement. The Partnership's primary exposure, if any, will relate to the
representations and warranties to be made about the Aurora System in the asset
purchase agreement. Any amounts remaining from this indemnity escrow account
and not claimed by the buyer at the end of the escrow period will be returned to
and distributed to the Partnership, 89-B, IDS Management Corporation and JIC at
that time. If the entire $3,283,500 escrow amount is distributed, the
Partnership would receive approximately $2,153,976, or 65.6 percent. The
Partnership would then distribute the $2,153,976 to the limited partners, which
would represent $12.50 for each $250 limited partnership interest or $50 for
each $1,000 invested in the Partnership. The Partnership will continue in
existence at least until any amounts remaining from the indemnity escrow account
have been distributed. Since the Aurora System represents the only asset of the
Partnership and the Venture, the Partnership and the Venture will be liquidated
and dissolved upon the final distribution of any amounts remaining from the
indemnity escrow account. If any disputes with respect to the indemnification
arise, the Partnership and the Venture would not be dissolved until such
disputes were resolved, which could result in the Partnership and the Venture
continuing in existence beyond 1999.
For the six months ended June 30, 1998, the Venture generated net cash from
operating activities totaling $2,177,504, which is available to fund capital
expenditures and non-operating costs. During the first six months of 1998, the
Venture expended approximately $2,190,000 on capital expenditures.
Approximately 46 percent of the expenditures related to construction of service
drops to subscriber homes. Approximately 33 percent of the expenditures related
to plant extensions to new homes passed. The remainder was for other capital
expenditures to maintain the value of the Aurora System. Funding for these
expenditures was provided by cash generated from operations and cash on hand.
Anticipated
8
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capital expenditures for the remainder of 1998 are approximately $2,120,000.
Approximately 52 percent of the anticipated capital expenditures is for plant
extensions to new homes passed. Approximately 27 percent of the anticipated
expenditures is for construction of service drops to subscriber homes. These
capital expenditures are necessary to maintain the value of the Aurora System
until it is sold. Funding for the expenditures is expected to be provided by
cash generated from operations and, if necessary and in its discretion,
borrowings from JIC. The Venture is obligated to conduct its business in the
ordinary course until the Aurora System is sold.
On December 5, 1991, JIC made a $1,800,000 loan to the Venture, of which
$1,200,000 had been repaid as of June 30, 1998. In the first quarter of 1994,
JIC agreed to subordinate to all other Venture debt its $1,406,647 advance to
the Venture outstanding at March 31, 1994 and IDS Management Corporation made a
loan of $1,000,000 to the Venture to fund principal repayments due on March 31,
1994 on the Venture's then-outstanding term loan. The interest rates on the
respective loans, which will vary from time to time, with respect to IDS
Management Corporation's loan, are at its cost of borrowing, and, with respect
to JIC's loans, are at its weighted average cost of borrowing. All of these
amounts owed to these related parties will be paid by the Venture with proceeds
to be received on the proposed sale of the Aurora System.
The Venture is a party to a $47,000,000 revolving credit and term loan
agreement with commercial banks. The agreement allows for a reducing revolving
commitment that will begin to reduce quarterly on June 30, 1999 until December
31, 1999, at which time the commitment will reduce to zero and all principal and
interest amounts will be due and payable in full. At June 30, 1998, all
$47,000,000 was outstanding under this agreement. The entire outstanding
balance of the revolving credit and term loan agreement will be repaid by the
Venture with proceeds from the proposed sale of the Aurora System. Interest on
the credit facility is at the Venture's option of the Prime Rate plus .5
percent, the London Interbank Offered Rate plus 1.5 percent or the Certificate
of Deposit Rate plus 1.625 percent. The effective interest rates on outstanding
obligations to non-affiliates as of June 30, 1998 and 1997 were 7.31 percent and
7.22 percent, respectively.
The Venture will rely on cash generated from operations and, if necessary
and in its discretion, advances from JIC to meet its liquidity needs until the
Aurora System is sold.
The Year 2000 issue is the result of many computer programs being written
such that they will malfunction when reading a year of "00." This problem could
cause system failure or miscalculations causing disruptions of business
processes.
JIC has initiated an assessment of its computer applications to determine
the extent of the problem. Based on this assessment, JIC has determined that
the majority of its computer applications supporting business processes,
including accounting and billing, are designed to handle the Year 2000
appropriately.
JIC is currently focusing its efforts on the impact of the Year 2000 issue
on service delivery. JIC has established an internal team to address this
issue. JIC is identifying and testing all date-sensitive equipment involved in
delivering service to the Venture's customers. In addition, JIC will assess the
Venture's options regarding repair or replacement of affected equipment during
this testing. JIC believes that the financial impact will not be material.
RESULTS OF OPERATIONS
- ---------------------
Revenues of the Venture's Aurora System increased $554,989, or
approximately 11 percent, to $5,484,098 for the three month period ended June
30, 1998 compared to $4,929,109 for the comparable 1997 period. Revenues
increased $980,484, or approximately 10 percent, to $10,622,039 for the six
months ended June 30, 1998 compared to $9,641,555 for the comparable 1997
period. Increases in the number of basic service subscribers accounted for
approximately 40 percent and 45 percent, respectively, of the increases in
revenues for the three and six month periods ended June 30, 1998. The number of
basic service subscribers increased 3,227, or approximately 7 percent, to 51,353
at June 30, 1998 compared to 48,126 at June 30, 1997. Basic service rate
increases accounted for approximately 42 percent and 37 percent, respectively,
of the increases in revenues for the three and six month periods. No other
individual factor was significant to the increases in revenues.
Operating expenses consist primarily of costs associated with the
operation and administration of the Aurora System. The principal cost
components are salaries paid to system personnel, programming expenses,
professional fees, subscriber billing costs, rent for leased facilities, cable
system maintenance expenses and marketing expenses.
9
<PAGE>
Operating expenses increased $282,823, or approximately 11 percent, to
$2,977,427 for the three month period ended June 30, 1998 compared to $2,694,604
for the comparable 1997 period. Operating expenses increased $356,970, or
approximately 7 percent, to $5,757,426 for the six months ended June 30, 1998
compared to $5,400,456 for the comparable 1997 period. Increases in programming
fees primarily accounted for the increases in operating expenses for the three
and six month periods. No other individual factor contributed significantly to
the increases in operating expenses. Operating expenses represented 54 percent
and 55 percent, respectively, of revenues for the three month periods ended June
30, 1998 and 1997, and 54 percent and 56 percent, respectively, for the six
month periods ended June 30, 1998 and 1997.
The cable television industry generally measures the financial performance
of a cable television system in terms of operating cash flow (revenues less
operating expenses). This measure is not intended to be a substitute or
improvement upon the items disclosed on the financial statements, rather it is
included because it is an industry standard. Operating cash flow increased
$272,166, or approximately 12 percent, to $2,506,671 for the three month period
ended June 30, 1998 compared to $2,234,505 for the comparable 1997 period.
Operating cash flow increased $623,514, or approximately 15 percent, to
$4,864,613 for the six months ended June 30, 1998 compared to $4,241,099 for the
comparable 1997 period. These increases were due to the increases in revenues
exceeding the increases in operating expenses.
Management and supervision fees and allocated overhead from the General
Partners increased $112,047, or approximately 22 percent, to $631,168 for the
three month period ended June 30, 1998 compared to $519,121 for the comparable
1997 period. Management and supervision fees and allocated overhead from the
General Partners increased $118,576, or approximately 11 percent, to $1,208,607
for the six months ended June 30, 1998 compared to $1,090,031 for the comparable
1997 period. These increases were primarily due to the timing of certain
expenses allocated from JIC and to the increases in revenues upon which such
management and supervision fees are based.
Depreciation and amortization expense decreased $188,304, or approximately
8 percent, to $2,160,854 for the three month period ended June 30, 1998 compared
to $2,349,158 for the comparable 1997 period. Depreciation and amortization
expense decreased $692,721, or approximately 14 percent, to $4,105,942 for the
six months ended June 30, 1998 compared to $4,798,663 for the comparable 1997
period. These decreases were due to the maturation of a portion of the
intangible asset base.
Operating loss decreased $348,423, or approximately 55 percent, to $285,351
for the three month period ended June 30, 1998 compared to $633,774 for the
similar 1997 period. Operating loss decreased $1,197,659, or approximately 73
percent, to $449,936 for the six months ended June 30, 1998 compared to
$1,647,595 in 1997. The decreases for the three and six month periods were due
to the increases in operating cash flow and the decreases in depreciation and
amortization expense.
Interest expense increased $32,498, or approximately 4 percent, to $949,601
for the three month period ended June 30, 1998 compared to $917,103 for the
comparable 1997 period. Interest expense increased $69,709, or approximately 4
percent, to $1,894,764 for the six months ended June 30, 1998 compared to
$1,825,055 for the comparable 1997 period. These increases were due to higher
outstanding balances and higher effective interest rates on interest bearing
obligations.
Consolidated loss decreased $323,342, or approximately 21 percent, to
$1,249,072 for the three month period ended June 30, 1998 compared to $1,572,414
for the comparable 1997 period. Consolidated loss decreased $1,124,515, or
approximately 32 percent, to $2,361,576 for the six months ended June 30, 1998
compared to $3,486,091 for the comparable 1997 period. These decreases were due
to the factors discussed above.
10
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PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
a) Exhibits
27) Financial Data Schedule
b) Reports on Form 8-K
None
11
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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.
IDS/JONES GROWTH PARTNERS II, L.P.
BY: JONES CABLE CORPORATION
its Managing General Partner
By: /S/ Kevin P. Coyle
----------------------------------
Kevin P. Coyle
Group Vice President/Finance
(Principal Financial Officer)
Dated: August 12, 1998
12
<TABLE> <S> <C>
<PAGE>
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