SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
/X/ Quarterly report pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended March 31, 1996
/ / 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: 0-20131
Fidelity Leasing Income Fund VIII, L.P.
_______________________________________________________________________________
(Exact name of registrant as specified in its charter)
Delaware 23-2627143
_______________________________________________________________________________
(State of organization) (I.R.S. Employer Identification No.)
7 E. Skippack Pike, Suite 275, Ambler, Pennsylvania 19002
_______________________________________________________________________________
(Address of principal executive offices) (Zip code)
(215) 619-2800
_______________________________________________________________________________
(Registrant's telephone number, including area code)
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 regis-
trant was required to file such reports), and (2) has been subject to such fil-
ing requirements for the past 90 days.
Yes __X__ No _____
Page 1 of 11
Part I: Financial Information
Item 1: Financial Statements
FIDELITY LEASING INCOME FUND VIII, L.P.
BALANCE SHEETS
ASSETS
(Unaudited) (Audited)
March 31, December 31,
1996 1995
________ ________
Cash and cash equivalents $1,965,667 $2,861,597
Accounts receivable 333,696 313,745
Interest receivable 123 4,259
Due from related parties 101,335 20,706
Equipment under operating leases
(net of accumulated depreciation
of $6,491,645 and $6,629,864,
respectively) 2,832,552 2,297,232
Equipment held for sale or lease 5,854 97,853
Organization costs
(net of accumulated amortization of
$9,167 and $8,667, respectively 833 1,333
__________ __________
Total assets $5,240,060 $5,596,725
========== ==========
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Lease rents paid in advance $ 28,968 $ 29,566
Accounts payable and
accrued expenses 89,333 50,909
Due to related parties 55,645 87,475
__________ __________
Total liabilities 173,946 167,950
Partners' capital 5,066,114 5,428,775
__________ __________
Total liabilities and
partners' capital $5,240,060 $5,596,725
========== ==========
The accompanying notes are an integral part of these financial statements.
2
FIDELITY LEASING INCOME FUND VIII, L.P.
STATEMENTS OF OPERATIONS
For the three months ended March 31, 1996 and 1995
(Unaudited)
1996 1995
________ ________
Income:
Rentals $547,109 $678,177
Interest 25,905 41,584
Other 473 320
________ ________
573,487 720,081
________ ________
Expenses:
Depreciation and amortization 385,444 607,940
Write-down of equipment to net
realizable value 136,368 -
General and administrative 33,151 17,950
General and administrative to related
party 38,053 20,499
Management fee to related party 21,634 26,872
Loss on sale of equipment, net 30,366 57,109
________ ________
645,016 730,370
________ ________
Net loss $(71,529) $(10,289)
======== ========
Net loss per equivalent
limited partnership unit $ (5.16) $ (0.63)
======== ========
Weighted average number of
equivalent limited partnership
units outstanding during the period 13,721 16,200
======== ========
The accompanying notes are an integral part of these financial statements.
3
FIDELITY LEASING INCOME FUND VIII, L.P.
STATEMENT OF PARTNERS' CAPITAL
For the three months ended March 31, 1996
(Unaudited)
General Limited Partners
Partner Units Amount Total
_______ _____ ______ _____
Balance, January 1, 1996 $(10,359) 22,812 $5,439,134 $5,428,775
Redemptions - (958) (226,132) (226,132)
Cash distributions (650) - (64,350) (65,000)
Net loss (715) - (70,814) (71,529)
_______ ______ __________ __________
Balance, March 31, 1996 $(11,724) 21,854 $5,077,838 $5,066,114
======= ====== ========== ==========
The accompanying notes are an integral part of these financial statements.
4
FIDELITY LEASING INCOME FUND VIII, L.P.
STATEMENTS OF CASH FLOWS
For the three months ended March 31, 1996 and 1995
(Unaudited)
1996 1995
__________ __________
Cash flows from operating activities:
Net loss $ (71,529) $ (10,289)
__________ __________
Adjustments to reconcile net loss
to net cash provided by operating
activities:
Depreciation and amortization 385,444 607,940
Write-down of equipment to net realizable value 136,368 -
Loss on sale of equipment, net 30,366 57,109
(Increase) decrease in accounts receivable (19,951) 192,392
(Increase) decrease in due from related parties (80,629) (821)
Increase (decrease) in lease rents paid
in advance (598) (26,878)
Increase (decrease) in due to related parties (31,830) (11,059)
Increase (decrease) in accounts payable and
accrued expenses 38,424 140,435
Increase (decrease) in other, net 4,136 5,288
__________ __________
461,730 964,406
__________ __________
Net cash provided by operating activities 390,201 954,117
__________ __________
Cash flows from investing activities:
Acquisition of equipment (1,129,280) (34,000)
Proceeds from sale of equipment 134,281 266,570
__________ __________
Net cash provided by (used in)
investing activities (994,999) 232,570
__________ __________
Cash flows from financing activities:
Redemptions of capital (226,132) (72,339)
Distributions (65,000) (322,139)
__________ __________
Net cash used in financing activities (291,132) (394,478)
__________ __________
Increase (decrease) in cash and cash equivalents (895,930) 792,209
Cash and cash equivalents, beginning
of period 2,861,597 2,005,306
__________ __________
Cash and cash equivalents, end of period $1,965,667 $2,797,515
========== ==========
The accompanying notes are an integral part of these financial statements.
5
FIDELITY LEASING INCOME FUND VIII, L.P.
NOTES TO FINANCIAL STATEMENTS
March 31, 1996
(Unaudited)
The accompanying unaudited condensed financial statements have been prepared
by the Fund in accordance with generally accepted accounting principles,
pursuant to the rules and regulations of the Securities and Exchange Commis-
sion. In the opinion of Management, all adjustments (consisting of normal
recurring accruals) considered necessary for a fair presentation have been
included.
1. ORGANIZATION
In February 1996, the name of the General Partner was changed from Fidelity
Leasing Corporation to F.L. Partnership Management, Inc.
2. EQUIPMENT LEASED
Equipment on lease consists primarily of computer equipment under operating
leases. A majority of the equipment was manufactured by IBM. The lessees
have agreements with the manufacturer to provide maintenance for the leased
equipment. The Fund's operating leases are for initial lease terms of 12
to 48 months. Generally, operating leases will not recover all of the
undepreciated cost and related expenses of its rental equipment during the
initial lease terms and the Fund is prepared to remarket the equipment in
future years. Fund policy is to review quarterly the expected economic
life of its rental equipment in order to determine the recoverability of
its undepreciated cost. Recent and anticipated technological developments
affecting computer equipment and competitive factors in the marketplace are
considered among other things, as part of this review. In accordance with
Generally Accepted Accounting Principles, the Fund writes down its rental
equipment to its estimated net realizable value when the amounts are
reasonably estimated and only recognizes gains upon actual sale of its
rental equipment. As a result, $136,368 and $-0- was charged to write-down
of equipment to net realizable value for the three months ended March 31,
1996 and 1995, respectively. Any future losses are dependent upon
unanticipated technological developments affecting the computer equipment
industry in subsequent years.
The future approximate minimum rentals to be received on noncancellable
operating leases as of March 31, 1996 are as follows:
Years Ending December 31 Minimum Rentals
________________________ _______________
1996 $1,327,000
1997 884,000
1998 607,000
1999 31,000
__________
$2,849,000
==========
6
FIDELITY LEASING INCOME FUND VIII, L.P.
NOTES TO FINANCIAL STATEMENTS (Continued)
3. RELATED PARTY TRANSACTIONS
The General Partner receives 4% or 2% of rental payments on equip-
ment under operating leases and full pay-out leases, respectively, for
administrative and management services performed on behalf of the Fund.
Full pay-out leases are noncancellable leases for which the rental payments
due during the initial term are at least sufficient to recover the purchase
price of the equipment, including acquisition fees. This management fee is
paid monthly only if and when the Limited Partners have received
distributions for the period from the initial closing through the end of
the most recent calendar quarter equal to a return for such period at a
rate of 11% per year on the aggregate amount paid for their units.
The General Partner may also receive up to 3% of the proceeds from the
sale of the Fund's equipment for services and activities to be performed
in connection with the disposition of equipment.
Additionally, the General Partner and its affiliates are reimbursed by the
Fund for certain costs of services and materials used by or for the Fund
except those items covered by the above-mentioned fees. Following is a
summary of fees and costs of services and materials charged by the General
Partner or its affiliates during the three months ended March 31:
1996 1995
________ ________
Management fee $21,634 $26,872
Reimbursable costs 38,053 20,499
Accrued sales fee 4,153 8,245
Amounts due from related parties at March 31, 1996 and December 31, 1995
represent monies due the Fund from the General Partner and/or other
affiliated funds for rentals and sales proceeds collected and not yet re-
mitted to the Fund.
Amounts due to related parties at March 31, 1996 and December 31, 1995
represent monies due to the General Partner for the fees and costs men-
tioned above, as well as, rentals and sales proceeds collected by the Fund
on behalf of other affiliated funds.
4. SUBSEQUENT EVENT
Cash Distribution:
The General Partner declared and paid a cash distribution of $20,000 in
April 1996 for the month ended March 31, 1996, to all admitted partners as
of March 31, 1996.
7
FIDELITY LEASING INCOME FUND VIII, L.P.
Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
RESULTS OF OPERATIONS
Fidelity Leasing Income Fund VIII, L.P. had revenues of $573,487 and
$720,081 for the three months ended March 31, 1996 and 1995, respectively.
Rental income from the leasing of computer peripheral equipment accounted for
95% and 94% of total revenues for the first quarter of 1996 and 1995, respec-
tively. The decrease in revenues is primarily attributable to the decrease in
rental income. In 1996, rental income decreased by approximately $265,000 be-
cause of equipment which came off lease and was re-leased at lower rental rates
or sold. This decrease, however, was reduced by approximately $134,000 of
rents generated from equipment purchased since the first quarter of 1995.
Expenses were $645,016 and $730,370 for the three months ended March 31,
1996 and 1995, respectively. Depreciation and amortization comprised 81% and
83% of total expenses during the first quarter of 1996 and 1995, respectively.
The decrease in expenses is directly related to the decrease in depreciation
expense resulting from equipment which came off lease or was sold since the
first quarter of 1995. The Fund incurred a net loss on sale of equipment of
$30,366 for the first quarter of 1996 as compared to $57,109 for the first
quarter of 1995, which also contributed to the decrease in expenses in 1996.
These decreases in expenses were reduced by an increase in the write-down of
equipment to net realizable value. Based upon the review of the
recoverability of the undepreciated cost of rental equipment, $136,368 was
charged to operations to write down equipment to its estimated net realizable
value for the three months ended March 31, 1996 as compared to $-0- for the
three months ended March 31, 1995. The General Partner believes, after
analyzing the current equipment portfolio, that there are impending gains to be
recognized upon the sale of certain of its equipment in future years. Any
future losses are dependent upon unanticipated technological developments
affecting the computer equipment industry in subsequent years.
The Fund's net loss was ($71,529) and ($10,289) for the three months ended
March 31, 1996 and 1995, respectively. The loss per equivalent limited
partnership unit, after loss allocated to the General Partner, was ($5.16) and
($0.63) based on a weighted average number of equivalent limited partnership
units outstanding of 13,721 and 16,200 for the three months ended March 31,
1996 and 1995, respectively.
The Fund generated $480,649 and $654,760 of funds from operations, for the
purpose of determining cash available for distribution, during the quarter
ended March 31, 1996 and 1995, respectively and distributed 14% and 33% of
these amounts to partners during the first quarter of 1996 and 1995, respec-
tively and 4% and 16% of these amounts to partners in April 1996 and 1995,
respectively.
8
Item 2: MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS (Continued)
ANALYSIS OF FINANCIAL CONDITION
During the quarter ended March 31, 1996 and 1995, the Fund purchased
$1,129,280 and $34,000, respectively, of equipment. The Fund will continue to
purchase equipment with cash available from operations which is not distributed
to partners.
The cash position of the Fund is reviewed daily and cash is invested on a
short-term basis.
The Fund's cash from operations is expected to continue to be adequate to
cover all operating expenses and contingencies during the next twelve month
period.
9
Part II: Other Information
FIDELITY LEASING INCOME FUND VIII, L.P.
March 31, 1996
Item 1. Legal Proceedings: Inapplicable.
Item 2. Changes in Securities: Inapplicable.
Item 3. Defaults Upon Senior Securities: Inapplicable.
Item 4. Submission of Matters to a Vote of Securities Holders: Inapplicable.
Item 5. Other Information: Inapplicable.
Item 6. Exhibits and Reports on Form 8-K:
a) Exhibits: None
b) Reports on Form 8-K: None
10
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the regis-
trant has duly caused this report to be signed on its behalf by the under-
signed, thereunto duly authorized.
FIDELITY LEASING INCOME FUND VIII, L.P.
5-14-96 By: Freddie M. Kotek
_______ ___________________________
Date Freddie M. Kotek
President of F.L Partnership
Management, Inc.
(Principal Operating Officer)
5-14-96 By: Marianne T. Schuster
_______ ___________________________
Date Marianne T. Schuster
Vice President of
F.L. Partnership Management, Inc.
(Principal Financial Officer)
11
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<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-END> MAR-31-1996
<CASH> 1,965,667
<SECURITIES> 0
<RECEIVABLES> 435,154
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 2,400,821
<PP&E> 9,330,051
<DEPRECIATION> 6,491,645
<TOTAL-ASSETS> 5,240,060
<CURRENT-LIABILITIES> 173,946
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 5,066,114
<TOTAL-LIABILITY-AND-EQUITY> 5,240,060
<SALES> 547,109
<TOTAL-REVENUES> 573,487
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 645,016
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 0
<INCOME-PRETAX> (71,529)
<INCOME-TAX> 0
<INCOME-CONTINUING> (71,529)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (71,529)
<EPS-PRIMARY> (5.16)
<EPS-DILUTED> (5.16)
</TABLE>
