<PAGE> 1
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 September 30, 1994.
( ) 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 0-20944
Jones Programming Partners 2-A, Ltd.
Exact name of registrant as specified in charter
Colorado #84-1088819
State of organization I.R.S. employer I.D.#
9697 East Mineral Avenue, P.O. Box 3309, Englewood, Colorado 80155-3309
Address of principal executive office
(303) 792-3111
Registrant's telephone number
Indicate by check mark whether the registrant (l) has filed all reports
required to be filed by Section l3 or l5(d) of the Securities Exchange Act of
l934 during the preceding l2 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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JONES PROGRAMMING PARTNERS 2-A, LTD.
(A Limited Partnership)
UNAUDITED BALANCE SHEETS
<TABLE>
<CAPTION>
September 30, December 31,
ASSETS 1994 1993
------ ----------- ----------
<S> <C> <C>
CASH AND CASH EQUIVALENTS $ 104,460 $ 253,758
ACCOUNTS RECEIVABLE
Domestic income receivable 600,000 -
Foreign income receivable - 274,338
INVESTMENT/ADVANCES FOR FILM PRODUCTION,
net of accumulated amortization of $2,774,709 and $707,920
at September 30, 1994 and December 31, 1993, respectively 3,177,057 4,861,698
----------
Total assets $3,881,517 $5,389,794
==========
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
-------------------------------------------
LIABILITIES:
Accounts payable to affiliates $ 406,134 $ 168,028
Production and overhead fee payable to the General Partner - 468,000
Accrued distributions to partners 141,781 141,781
Accrued liabilities 4,696 2,500
----------- ----------
552,611 780,309
----------- ----------
DEFERRED REVENUE - 980,167
----------- ----------
PARTNERS' CAPITAL (DEFICIT):
General Partner-
Contributed capital 1,000 1,000
Distributions (11,999) (7,745)
Accumulated deficit (2,962) (4,237)
----------- ----------
(13,961) (10,982)
----------- ----------
Limited Partners -
Net contributed capital (11,229 units outstanding at
September 30, 1994 and December 31, 1993, respectively) 4,823,980 4,826,514
Distributions (1,187,881) (766,792)
Accumulated deficit (293,232) (419,422)
----------- ----------
3,342,867 3,640,300
----------
Total liabilities and partners' capital (deficit) $ 3,881,517 $5,389,794
==========
</TABLE>
The accompanying notes to unaudited financial statements
are an integral part of these unaudited balance sheets.
2
<PAGE> 3
JONES PROGRAMMING PARTNERS 2-A, LTD.
(A Limited Partnership)
UNAUDITED STATEMENTS OF OPERATIONS
<TABLE>
<CAPTION>
For the Three Months Ended For the Nine Months Ended
September 30, September 30,
------------------------- ------------------------------
1994 1993 1994 1993
-------- ------- ---------- -------
<S> <C> <C> <C> <C>
GROSS REVENUES $727,006 $ - $2,313,149 $ -
COSTS AND EXPENSES:
Costs of filmed entertainment 683,384 - 2,066,789 -
Distribution fees and expenses 95,146 - 104,839 -
Operating, general and administrative expenses 4,150 4,239 18,369 23,648
-------- ------- ---------- -------
OPERATING INCOME (LOSS) (55,674) (4,239) 123,152 (23,648)
-------- ------- ---------- -------
OTHER INCOME (EXPENSE):
Interest income 1,656 5,879 4,313 35,792
Other, net - 18,507 - 18,507
-------- ------- ---------- -------
NET INCOME (LOSS) $(54,018) $20,147 $ 127,465 $30,651
======== ======= ========== =======
ALLOCATION OF NET INCOME (LOSS):
General Partner $ (540) $ 201 $ 1,275 $ 307
======== ======= ========== =======
Limited Partners $(53,478) $19,946 $ 126,190 $30,344
======== ======= ========== =======
NET INCOME (LOSS) PER LIMITED
PARTNERSHIP UNIT $ (4.76) $ 1.78 $ 11.24 $ 2.81
======== ======= ========== =======
WEIGHTED AVERAGE NUMBER
OF LIMITED PARTNERSHIP UNITS
OUTSTANDING 11,229 11,229 11,229 10,794
======== ======= ========== =======
</TABLE>
The accompanying notes to unaudited financial statements
are an integral part of these unaudited statements.
3
<PAGE> 4
JONES PROGRAMMING PARTNERS 2-A, LTD.
(A Limited Partnership)
UNAUDITED STATEMENTS OF CASH FLOWS
<TABLE>
<CAPTION>
For the Nine Months Ended
September 30,
-----------------------------
1994 1993
---------- ------------
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 127,465 $ 30,651
Adjustments to reconcile net income to net cash
provided by operating activities:
Amortization of filmed entertainment costs 2,066,789 -
Increase in domestic income receivable (600,000) -
Decrease in foreign income receivable 274,338 -
Decrease in interest receivable - 20,345
Increase in other assets - (67,925)
Increase (decrease) in accrued liabilities 2,196 (845)
Increase in accounts payable to affiliates 238,106 468,930
Increase (decrease) in deferred revenue (980,167) 490,083
---------- ------------
Net cash provided by operating activities 1,128,727 941,239
---------- ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
Payment of production and overhead fee (468,000) -
Film production advances (382,148) (3,925,458)
---------- ------------
Net cash used in investing activities (850,148) (3,925,458)
---------- ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
Contributed capital, net of commissions and syndication costs - 843,525
Interest distribution to limited partners (2,534) -
Increase in accrued distributions to partners - 23,953
Distributions to partners (425,343) (425,343)
---------- ------------
Net cash provided by (used in ) financing activities (427,877) 442,135
---------- ------------
Decrease in cash and cash equivalents (149,298) (2,542,084)
Cash and cash equivalents, beginning of period 253,758 2,784,773
---------- ------------
Cash and cash equivalents, end of period $ 104,460 $ 242,689
========== ============
</TABLE>
The accompanying notes to unaudited financial statements
are an integral part of these unaudited statements.
4
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JONES PROGRAMMING PARTNERS 2-A, LTD.
(A Limited Partnership)
NOTES TO UNAUDITED FINANCIAL STATEMENTS
(1) BASIS OF PRESENTATION
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 fair 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 Jones Programming
Partners 2-A, Ltd. (the "Partnership") at September 30, 1994 and December 31,
1993 and the results of operations and its cash flows for the three and nine
month periods ended September 30, 1994 and 1993. Results of operations for
these periods are not necessarily indicative of results to be expected for the
full year. Certain prior year amounts have been reclassified to conform to the
1994 presentation.
(2) TRANSACTIONS WITH AFFILIATED ENTITIES
Jones Entertainment Group, Ltd. (the "General Partner") receives a
production and overhead fee for administering the affairs of the Partnership
equal to 12 percent of the lower of direct costs or budgeted direct costs of
each programming project. This fee will be calculated and payable at the time
principal photography commences on each particular project and, in the case of
a series, is payable on a per episode basis. The Partnership paid a $100,000
production and overhead fee to the General Partner in March 1993 for the
production of "Household Saints." In addition, the Partnership paid a $468,000
production and overhead fee to the General Partner in the second quarter of
1994 for the production of "The Whipping Boy." These fees are included in
Investment/Advances for Film Production on the Partnership's Unaudited Balance
Sheets. It is not anticipated that the General Partner will receive any
additional production and overhead fees from the Partnership as the Partnership
is not expected to invest in any additional programming projects.
The General Partner also is entitled to reimbursement from the
Partnership for its direct and indirect expenses allocable to the operations of
the Partnership, which shall include, but not be limited to, rent, supplies,
telephone, travel, legal expenses, accounting and auditing expenses,
preparation and distribution of reports to investors and salaries of any full
or part-time employees. The General Partner believes that the methodology used
in allocating overhead and administrative expenses is reasonable. Although the
General Partner is entitled to reimbursement for all direct and indirect
expenses allocable to the Partnership, for the three month periods ended
September 30, 1994 and 1993, only $1,674 and $624, respectively, were charged
to the Partnership for such expenses and for the nine month periods ended
September 30, 1994 and 1993, only $3,261 and $3,612, respectively, were charged
to the Partnership for such expenses.
(3) INVESTMENT/ADVANCES FOR FILM PRODUCTION
"Charlton Heston Presents: The Bible"
In May 1992, the General Partner, on behalf of the Partnership,
entered into an agreement with Agamemnon Films, an unaffiliated party, to
produce four one-hour programs for television, entitled "Charlton Heston
Presents: The Bible" (the "Bible Programs"). The production costs of the Bible
Programs were approximately $2,100,000. In addition, the Partnership paid a
$240,000 production and overhead fee to the General Partner. In return for
agreeing to fund these production costs, the Partnership acquired all rights to
the Bible Programs in all markets and in all media in perpetuity. As described
in the following paragraph, the Partnership subsequently assigned half of its
ownership of the Bible Programs to an unaffiliated party for an investment of
$1,000,000 toward the production costs for the Bible Programs. After
consideration of this investment by the unaffiliated party, the Partnership's
total investment in the Bible Programs was $1,369,765 and its net investment,
after consideration of amortization, was $993,733 at September 30, 1994.
5
<PAGE> 6
In order to reduce the Partnership's financial exposure, the General
Partner, on behalf of the Partnership, assigned one-half of the Partnership's
interest in the Bible Programs to GoodTimes Home Video Corporation
("GoodTimes"), an unaffiliated entity directly involved in the specialty home
video and international television distribution business, for an investment by
GoodTimes of $1,000,000. The Partnership and GoodTimes funded Jones
Documentary Film Corporation ("JDFC"), which in turn contracted with Agamemnon
Films for the production of the Bible Programs. JDFC was formed to insulate
the Partnership and GoodTimes from certain risks and potential liabilities
associated with the production of programming in foreign countries because the
Bible Programs were filmed on location in the Holy Lands.
The Partnership and JDFC granted the General Partner the exclusive
rights to distribute the Bible Programs. To accomplish this, the General
Partner, on its own behalf, and GoodTimes entered into an agreement to form J/G
Distribution Company to distribute the Bible Programs. J/G Distribution
Company was formed effective as of June 24, 1992 and the Partnership granted it
the sole and exclusive right to exhibit and distribute, and to license others
to exhibit and distribute, the Bible Programs throughout the universe, in
perpetuity, in all languages and in all media. J/G Distribution Company holds
the copyright for the benefit of the Partnership (50 percent interest) and
GoodTimes (50 percent interest). J/G Distribution Company is currently
distributing the Bible Programs in the retail home video market. As of
September 30, 1994, the Partnership's share of gross revenues totalled
$171,994, of which $85,997 was retained by the distributor for its fees and
marketing costs. The remaining $85,997 has been received by the Partnership.
"Household Saints"
In February 1993, the Partnership acquired a one-third ownership
interest in a film scheduled for world-wide theatrical release entitled
"Household Saints." The budgeted production costs of "Household Saints" were
approximately $5,000,000, and the final production costs were approximately
$5,300,000. For a one-third ownership interest in the film, the Partnership
has contributed one-third of the budgeted production costs, or $1,666,667. Two
unaffiliated entities contributed similar amounts. At September 30, 1994, the
Partnership had invested approximately $1,913,890 in the film, which included
production and overhead fee of $100,000 paid to the General Partner by the
Partnership. Although under the terms of the Partnership's limited partnership
agreement the General Partner is entitled to a fee of 12 percent of the lower
of actual or budgeted production costs for each Partnership film project, which
fee would have been approximately $600,000 for "Household Saints," the General
Partner only took $100,000 as its production and overhead fee due to the
limited involvement of the General Partner in the film's production. At
September 30, 1994, the Partnership's net investment in the film, after
consideration of amortization, was $1,389,138.
The other owners of the film, which are not affiliated with the
Partnership or the General Partner, are New Line Productions, Inc. ("New Line")
and Columbia Tristar Home Video ("Columbia Tristar"), each of which owns a
one-third interest in the film for contributing one-third of the film's
budgeted production costs and completion costs. As equal participants in the
film, the Partnership, New Line and Columbia Tristar will generally share
equally in the net revenues generated by the film's distribution in all markets
until they each have recouped their investment in the film plus 12 percent per
annum interest on their unrecouped investment, after which net revenues will
also be shared with the film's talent.
"Household Saints" was released in theatres in the United States and
Canada in September 1993 and the film performed to a disappointing box office
of approximately $600,000 in the United States. Fine Line, a subsidiary of New
Line, was the film's North American theatrical distributor. Fine Line earned a
distribution fee equal to 20 percent of gross revenues generated by the
distribution of the film in theatres in the United States and Canada and it was
entitled to reimbursement of its distribution costs. Net theatrical revenues
were split equally among the Partnership, New Line and Columbia Tristar. The
funds that the Partnership and New Line each contributed for prints and
advertising in connection with the film's North American theatrical release
have been reimbursed to the Partnership and New Line. As of September 30,
1994, the Partnership's share of gross revenues totalled $603,198, of which
$203,198 will be retained by the distributor for its fees and marketing costs.
The remaining $400,000 has been received by the Partnership and has been
applied toward recoupment of its $406,000 prints and advertising expenditures.
The film's international distribution in all media is being undertaken
by New Line International, also a subsidiary of New Line. From the gross
revenues generated by the film's distribution in all international media, New
Line International will be entitled to a 20 percent distribution fee plus
reimbursement of its costs, which are not to exceed $50,000, incurred in
distributing the film internationally. Net international revenues will be
split equally among the Partnership, New Line and Columbia Tristar. As of
September 30, 1994, international sales of approximately $1,050,000 had been
made, of which approximately $946,000 was attributed to sales in Italy and
Spain. Distribution in the international media is continuing.
6
<PAGE> 7
The film's domestic home video distribution was undertaken by Columbia
Tristar. The disappointing U.S.theatrical box office translated to a
disappointing unit volume of rental home video sales (under 10,000 units have
been sold). From the gross revenues generated by the distribution of the film
in U.S. home video markets, Columbia Tristar will be entitled to a 20 percent
distribution fee plus reimbursement of its distribution costs, which are not to
exceed 18 percent of home video gross revenues. Net revenues from home video
sales will be split equally among the Partnership, New Line and Columbia
Tristar. As of September 30, 1994, domestic home video sales of approximately
$24,000 had been made.
The film's distribution on television in the United States is being
undertaken jointly by New Line and the General Partner. From gross revenues
generated by the distribution of the film in U.S. television markets, New Line
and the General Partner will split a 20 percent distribution fee and will be
entitled to reimbursement of their costs incurred in distributing the film in
such markets. Net revenues from the distribution of the film in U.S.
television markets will be split equally among the Partnership, New Line and
Columbia Tristar.
All of the foregoing net revenue splits will govern until the
Partnership, New Line and Columbia Tristar recoup their original investments
plus interest on any unrecouped funds. Thereafter, a portion of net revenues
will be shared with the production unit, which includes the producers, writers,
director and actors. Such net post-recoupment revenues will be split 35
percent to the production unit, 25 percent to the Partnership, 20 percent to
New Line and 20 percent to Columbia Tristar until the production unit has
received $1,000,000 in net revenues. After the production unit has received
$1,000,000 in net revenues and until it has received $2,000,000 in net
revenues, the split will be 25 percent to the production unit, 35 percent to
the Partnership, 20 percent to New Line and 20 percent to Columbia Tristar.
After the production unit has received $2,000,000 in net revenues, and
thereafter, in perpetuity, net revenues will be split 10 percent to the
production unit, 50 percent to the Partnership, 20 percent to New Line and 20
percent to Columbia Tristar.
The terms of the distribution agreements with each of New Line and
Columbia Tristar are 15 years, and can be renewed by New Line and Columbia
Tristar at their option subject to the Partnership's right, at five-year
intervals thereafter, to acquire New Line's and/or Columbia Tristar's
distribution rights if the Partnership has not yet recouped its investment in
the film and if the Partnership has another bona fide distribution plan in
place.
"The Whipping Boy"
In August 1993, the Partnership acquired the rights to "The Whipping
Boy." "The Whipping Boy" has been made into a two-hour telefilm. The film
premiered in the North American television market on The Disney Channel, which
is one of the leading pay cable television services in the United States and
Canada, in July 1994. The film cost was approximately $4,100,000. At
September 30, 1994, the Partnership had invested approximately $2,668,111 in
the film, which includes a $468,000 production and overhead fee paid to the
General Partner. At September 30, 1994, the Partnership's net investment in
the film, after consideration of amortization, was $794,186. The film was
co-produced by the General Partner and Gemini Films, a German company.
Principal photography on the movie commenced in September 1993, and
post-production occurred in October 1993. The completed picture was delivered
to The Disney Channel in the second quarter of 1994.
The Partnership was responsible for approximately one-half of the
$4,100,000 production cost, with the balance of the production budget funded by
Gemini Films and other co-production partners and/or territorial advances from
the film's international distributors. The amount contributed to the
production budget by the Partnership will be partially reimbursed by license
advances totalling $2,100,000 from The Disney Channel, of which $1,500,000 has
been received by the Partnership at September 30, 1994.
Gemini Films will have, in perpetuity, the copyright and all
exploitation rights to the film in German language territories (defined as
Germany, Austria, German-speaking Switzerland and German-speaking Luxembourg).
It is anticipated that the film will be released theatrically in Germany in the
fourth quarter. Although these exploitation rights will remain the sole
property of Gemini Films, Gemini Films will account to the Partnership for any
revenue therefrom.
The Partnership will own the world-wide copyright, excluding German
language territories, in perpetuity. Although the Partnership will own all
exploitation rights in all media in North America, which is defined as the
United States, Canada and their respective territories and possessions, the
Partnership will account to Gemini Films for any revenue generated therefrom.
7
<PAGE> 8
From the movie's North American revenues, the Partnership will first
be entitled to recover its investment plus interest. Thereafter, the
Partnership will receive 90 percent of all North American revenues and Gemini
Films will receive 10 percent of such revenues. With respect to international
revenues from the movie's distribution, after Gemini Films recovers $250,000 of
its investment in the movie's production budget, any funded overages and
interest out of net international revenues, the Partnership will receive 20
percent of net international revenues and Gemini Films will receive 80 percent
of net international revenues.
The General Partner and Gemini Films have selected Canal Plus
Distribution as the company that will distribute and exploit the movie outside
of North America. Canal Plus Distribution will earn distribution fees of 15
percent of the film's gross receipts outside of North America, and it will be
reimbursed for its expenses capped at 10 percent of the film's gross receipts
outside of North America (excluding dubbing costs). Canal Plus Distribution
will be responsible for accounting and remitting to Gemini Films the net
revenues from the film's distribution in all markets and in all media outside
of North America. Gemini Films will be responsible for forwarding the
Partnership's share of such revenues within 10 days of receipt of such funds
from Canal Plus.
8
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JONES PROGRAMMING PARTNERS 2-A, LTD.
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
FINANCIAL CONDITION
Capital Resources
The Partnership's potential sources of capital are funds to be
received from the domestic and international distribution of the Partnership's
programming.
The Partnership received limited partner subscriptions totaling
$5,614,500, of which $4,842,506 was available for investment after payment of
sales commissions and other organizational and offering costs. The Partnership
has distributed $18,526 of interest earned on these subscriptions; $15,992 was
distributed to the limited partners in 1992 when the Partnership was formed and
an additional $2,534 was distributed to the limited partners in 1994 for
interest earned on subscriptions during the rescission period. The Partnership
has invested all of its net offering proceeds in film projects. At September
30, 1994, the Partnership had $104,460 in cash. It is not anticipated that the
Partnership will invest in any additional programming projects, but instead
will focus on the distribution of its existing projects.
Liquidity
The Partnership's principal sources of liquidity are cash on hand and
amounts to be received fromthe domestic and international distribution of its
programming.
In May 1992, the General Partner, on behalf of the Partnership,
entered into an agreement with Agamemnon Films, an unaffiliated party, to
produce four one-hour programs for television, entitled "Charlton Heston
Presents: The Bible" (the "Bible Programs"). The production costs of the Bible
Programs were approximately $2,100,000. In addition, the Partnership paid a
$240,000 production and overhead fee to the General Partner. In return for
agreeing to fund these production costs, the Partnership acquired all rights to
the Bible Programs in all markets and in all media in perpetuity. The
Partnership subsequently assigned half of its ownership of the Bible Programs
to an unaffiliated party, GoodTimes, for an investment of $1,000,000 toward the
production costs for the Bible Programs.
In April 1992, the General Partner, on behalf of the Partnership,
entered into an agreement with an affiliate of the Arts & Entertainment Network
(the "A&E Network") for the rights to exhibit the Bible Programs over the A&E
Network for a period of four years. Under the terms of this agreement, the
Partnership received $400,000 from the A&E Network. Of the $400,000 received
by the Partnership pursuant to its agreement with the A&E Network, $191,000 was
paid to GoodTimes Home Video Corporation for its 50 percent interest, net of
$9,000 in administrative costs. The Partnership and the A&E Network each had
an option to terminate their agreement at the end of the four-year exhibition
period within twelve months from the November 6, 1992 delivery of the Bible
Programs to the A&E Network by paying the non-terminating party $50,000. In
November 1993, the A&E Network decided to terminate the agreement.
The Partnership granted the General Partner the exclusive rights to
distribute the Bible Programs. To accomplish this, the General Partner, on its
own behalf, and GoodTimes entered into an agreement to form J/G Distribution
Company to distribute the Bible Programs. J/G Distribution Company was formed
effective as of June 24, 1992 and the Partnership granted it the sole and
exclusive right to exhibit and distribute, and to license others to exhibit and
distribute, the Bible Programs throughout the universe, in perpetuity, in all
languages and in all media. J/G Distribution Company holds the copyright for
the benefit of the Partnership (50 percent interest) and GoodTimes (50 percent
interest). J/G Distribution Company is currently distributing the Bible
Programs in the retail home video market. At September 30, 1994, the
Partnership had received $85,997 from the sale of the Bible Programs in the
home video market by J/G Distribution Company.
9
<PAGE> 10
In February 1993, the Partnership acquired a one-third ownership
interest in a film scheduled for world-wide theatrical release entitled
"Household Saints." For a one-third ownership interest in the film, the
Partnership has contributed one-third of the budgeted production costs, or
$1,666,667, along with two other unaffiliated entities. At September 30, 1994,
the Partnership had invested approximately $1,913,890 in the film, which
included production and overhead fee of $100,000 paid to the General Partner
by the Partnership. Although under the terms of the Partnership's limited
partnership agreement the General Partner is entitled to a fee of 12 percent of
the lower of actual or budgeted production costs for each Partnership film
project, which fee would have been approximately $600,000 for "Household
Saints," the General Partner only took $100,000 as its production and overhead
fee due to the limited involvement of the General Partner in the film's
production. In addition, the Partnership paid approximately $406,000 for
prints and advertising costs.
An unaffiliated entity began marketing the film in all international
media in March 1993, and in September 1993, the film was released in theaters
in the United States and Canada. The film performed to a disappointing box
office of approximately $600,000 in the United States. The disappointing U.S.
theatrical box office translated to a disappointing unit volume of rental home
video sales (under 10,000 units have been sold). The funds that the
Partnership and another one-third owner contributed for prints and advertising
in connection with the film's theatrical release will be reimbursed from
world-wide revenues in a senior position before the three owners begin
participating in the one-third revenue split. As of September 30, 1994, the
Partnership's share of gross revenues totalled $603,198, of which $203,198 has
been retained by the distributor for its fees and marketing costs. The
remaining $400,000 has been received by the Partnership and had been applied
toward recoupment of its prints and advertising costs.
In August 1993, the Partnership acquired the rights to "The Whipping
Boy." "The Whipping Boy" has been made into a two-hour telefilm. At
September 30, 1994, the Partnership had invested approximately $2,668,111 in
the film, which includes a $468,000 production and overhead fee payable to the
General Partner. The Partnership has received approximately $1,500,000 and
expects to receive $600,000 in the fourth quarter from The Disney Channel for
licensing certain rights to the film to The Disney Channel.
In December 1993, the Partnership declared a distribution of $141,781
which was paid to the partners in February 1994. In March 1994, the
Partnership declared a distribution of $141,781, which was paid to the partners
in May 1994. In June 1994, the Partnership declared a distribution of
$141,781, which was paid to the partners in August 1994. In September 1994,
the Partnership declared a distribution of $141,781, which will be paid to the
partners in November 1994. These distributions were made using cash on hand,
interest income and cash provided by operations. Distributions are expected to
continue, although no determination has been made regarding any specific level
of future distributions.
Accounts payable to affiliates totalled $406,134 at September 30,
1994. Advances from affiliates were provided to meet the needs of the
Partnership and will be repaid upon receipt of $600,000 from The Disney
Channel, which is expected to be received in the fourth quarter.
The General Partner believes that the Partnership has, and will
continue to have, sufficient sources of capital available to conduct its
operations and to meet its future presently anticipated obligations.
RESULTS OF OPERATIONS
Revenues of the Partnership increased $727,006, from $-0- for the
three month period ended September 30, 1993 to $727,006 for the similar period
in 1994. Revenues of the Partnership increased $2,313,149, from $-0- for the
nine month period ended September 30, 1993 to $2,313,149 for the similar period
in 1994. These increases were the result of sales of the Partnership's
programming during 1994. In 1994, the Partnership recognized revenues of
$41,155 associated with "Household Saints," $171,994 associated with "Charlton
Heston Presents: The Bible" (the "Bible Programs") and $2,100,000 associated
with "The Whipping Boy."
Filmed entertainment costs increased $683,384, from $-0- for the three
month period ended September 30, 1993 to $683,384 for the similar period in
1994. Filmed entertainment costs increased $2,066,789, from $-0- for the nine
month period ended September 30, 1993 to $2,066,789 for the similar period in
1994. These increases were the result of increased revenues as mentioned above
because filmed entertainment costs are amortized over the life of each film in
the ratio that current gross revenues bear to anticipated total gross revenues.
10
<PAGE> 11
Distribution fees and expenses increased $95,146, from $-0- for the
three month period ended September 30, 1993 to $95,146 for the similar period
in 1994. Distribution fees and expenses increased $104,839, from $-0- for the
nine month period ended September 30, 1993 to $104,839 for the similar period
in 1994. These increases were the result of domestic and international home
video sales of the "Bible Programs" and of international sales of "Household
Saints," which accounted for $85,997 and $18,842, respectively. Distribution
fees and expenses relate to the compensation due and costs incurred by
unaffiliated parties in selling the Partnership's film productions in the
international theatrical, television and home video markets.
Operating, general and administrative expenses decreased $89, from
$4,239 for the three month period ended September 30, 1993 to $4,150 for the
similar period in 1994. Operating, general and administrative expenses
decreased $5,279, from $23,648 for the nine month period ended September 30,
1993 to $18,369 for the similar period in 1994. This decrease was primarily
due to a decrease in professional service costs incurred by the Partnership
during the nine month period ended September 30, 1994 as compared to the
similar 1993 period.
Interest income decreased $4,223, from $5,879 for the three month
period ended September 30, 1993 to $1,656 for the similar period in 1994.
Interest income decreased $31,479, from $35,792 for the nine month period ended
September 30, 1993 to $4,313 for the similar period in 1994. These decreases
in interest income are the result of lower average cash balances invested
during 1994 as compared to average balances invested in 1993.
The Partnership recorded net income of $20,147 for the three months
ended September 30, 1993 as compared to a net loss of $54,018 for the similar
period in 1994. This change is primarily due to an increase in the costs of
filmed entertainment that exceeded the increase in revenues and a decrease in
interest income in 1994. The Partnership recorded net income of $30,651 for
the nine months ended September 30, 1993 as compared to net income of $127,465
for the similar period in 1994. This change is primarily due to a decrease in
operating, general and administrative expenses and to an increase in revenues,
which was only partially offset by an increase in the costs of filmed
entertainment, in 1994.
11
<PAGE> 12
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
12
<PAGE> 13
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.
JONES PROGRAMMING PARTNERS 2-A, LTD.
BY: JONES ENTERTAINMENT GROUP, LTD.
General Partner
By: /S/ Theodore A. Henderson
Theodore A. Henderson
Principal Financial and Accounting Officer
Dated: November 11, 1994
13
<PAGE> 14
EXHIBIT INDEX
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER DESCRIPTION PAGE
- - ------- ----------- ------------
<S> <C> <C>
27 Financial Data Schedule
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1994
<PERIOD-START> JAN-01-1994
<PERIOD-END> SEP-30-1994
<CASH> 104,460
<SECURITIES> 0
<RECEIVABLES> 600,000
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 0
<DEPRECIATION> 0
<TOTAL-ASSETS> 3,881,517
<CURRENT-LIABILITIES> 552,611
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 3,328,906
<TOTAL-LIABILITY-AND-EQUITY> 3,881,517
<SALES> 0
<TOTAL-REVENUES> 2,313,149
<CGS> 0
<TOTAL-COSTS> 2,189,997
<OTHER-EXPENSES> (4,313)
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> 127,465
<INCOME-TAX> 0
<INCOME-CONTINUING> 127,465
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 127,465
<EPS-PRIMARY> 11.24
<EPS-DILUTED> 11.24
</TABLE>
