UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
-------------------
FORM 10-Q
[X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934 For the fiscal quarter ended March 31, 1997.
[ ] 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 33-40093
-----------------------
PLM EQUIPMENT GROWTH FUND VI
(Exact name of registrant as specified in its charter)
California 94-3135515
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
One Market, Steuart Street Tower
Suite 800, San Francisco, CA 94105-1301
(Address of principal (Zip code)
executive offices)
Registrant's telephone number, including area code (415) 974-1399
-----------------------
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 ____
<PAGE>
PLM EQUIPMENT GROWTH FUND VI
(A Limited Partnership)
BALANCE SHEETS
(in thousands, except unit amounts)
ASSETS
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
-----------------------------------
<S> <C> <C>
Equipment held for operating leases $ 109,077 $ 109,551
Less accumulated depreciation (48,866 ) (46,544 )
-----------------------------------
Net equipment 60,211 63,007
Cash and cash equivalents 1,376 3,017
Restricted cash 1,279 1,285
Investments in unconsolidated special purpose entities 40,669 42,119
Accounts receivable, net of allowance for doubtful accounts
of $1,028 in 1997 and $1,188 in 1996 3,357 3,253
Net investment in direct finance lease 451 254
Prepaid expenses and other assets 180 241
Deferred charges, net of accumulated amortization of
$228 in 1997 and $381 in 1996 320 349
-----------------------------------
Total assets $ 107,843 $ 113,525
===================================
LIABILITIES AND PARTNERS' CAPITAL
Liabilities:
Accounts payable and accrued expenses $ 854 $ 1,048
Due to affiliates 2,164 2,177
Lessee deposits and reserve for repairs 3,613 3,224
Short term note payable -- 1,286
Note payable 30,000 30,000
-----------------------------------
Total liabilities 36,631 37,735
Partners' capital:
Limited partners (8,253,350 depositary units at March 31,
1997 and 8,286,966 at December 31, 1996) 71,212 75,790
General Partner -- --
-----------------------------------
Total partners' capital 71,212 75,790
-----------------------------------
Total liabilities and partner's capital $ 107,843 $ 113,525
===================================
</TABLE>
See accompanying notes to financial
statements.
<PAGE>
PLM EQUIPMENT GROWTH FUND VI
(A Limited Partnership)
STATEMENTS OF INCOME
(in thousands, except per unit amounts)
<TABLE>
<CAPTION>
For the Three Months
Ended March 31,
1997 1996
------------------------------
<S> <C> <C>
Revenues:
Lease revenue $ 5,637 $ 5,355
Interest and other income 50 229
Net gain on disposition of equipment 12 6,329
------------------------------
Total revenues 5,699 11,913
Expenses:
Depreciation and amortization 2,582 2,973
Management fees to affiliate 323 293
Repairs and maintenance 692 779
Interest expense 502 524
Marine equipment operating expenses 820 705
Insurance expense to affiliate 69 59
Other insurance expense 202 199
General and administrative expenses
to affiliates 219 269
Other general and administrative expenses 361 135
Bad debt expense (159 ) 133
------------------------------
------------------------------
5,611 6,069
------------------------------
Equity in net income (loss) of unconsolidated
special purpose entities 109 (452 )
------------------------------
Net income $ 197 $ 5,392
==============================
Partners' share of net income (loss):
Limited partners $ (21 ) $ 5,173
General Partner 218 219
------------------------------
Total $ 197 $ 5,392
==============================
Net income (loss) per weighted-average depositary unit
(8,283,484 units at March 31, 1997,
8,309,773 units at March 31, 1996) $ (0.003 ) $ 0.62
==============================
Cash distributions $ 4,362 $ 4,374
==============================
Cash distributions per weighted-average depositary unit $ 0.50 $ 0.50
==============================
</TABLE>
See accompanying notes to financial
statements.
<PAGE>
PLM EQUIPMENT GROWTH FUND VI
( A Limited Partnership)
STATEMENTS OF CHANGES IN PARTNERS' CAPITAL For
the period from December 31, 1995 to March 31, 1997
(in thousands)
<TABLE>
<CAPTION>
Limited General
Partners Partner Total
-------------------------------------------------------
<S> <C> <C> <C>
Partners' capital at December 31, 1995 $ 85,430 $ -- $ 85,430
Net income 7,418 873 8,291
Repurchase of depositary units (464 ) -- (464 )
Cash distributions (16,594 ) (873 ) (17,467 )
-------------------------------------------------------
Partners' capital at December 31, 1996 75,790 -- 75,790
Net income (loss) (21 ) 218 197
Repurchase of depositary units (413 ) -- (413 )
Cash distributions (4,144 ) (218 ) (4,362 )
-------------------------------------------------------
Partners' capital at March 31, 1997 $ 71,212 $ -- $ 71,212
=======================================================
</TABLE>
See accompanying notes to financial
statements.
<PAGE>
PLM EQUIPMENT GROWTH FUND VI
(A Limited Partnership)
STATEMENTS OF CASH FLOWS
(in thousands)
<TABLE>
<CAPTION>
For the Three Months
Ended March 31,
1997 1996
------------------------------
<S> <C> <C>
Operating activities:
Net income $ 197 $ 5,392
Adjustments to reconcile net income
to net cash provided by operating activities:
Net gain on disposition of equipment (12 ) (6,329 )
Equity in net (income) loss from
unconsolidated special purpose entities (110 ) 452
Depreciation and amortization 2,582 2,973
Changes in operating assets and liabilities:
Restricted cash 7 --
Accounts receivable (210 ) 507
Prepaid expenses 61 67
Accounts payable and accrued expenses (194 ) (298 )
Due to affiliates (12 ) (446 )
Lessee deposits and reserve for repairs 389 462
-----------------------------
Net cash provided by operating activities 2,698 2,780
-----------------------------
Investing activities:
Payments for purchase of equipment (5 ) (13,699 )
Investment in and equipment purchased and placed in
unconsolidated special purpose entities -- (14,240 )
Distributions from unconsolidated special purpose entities 1,559 397
Payments of acquisition fees to affiliate -- (675 )
Payments of lease negotiation fees to affiliate -- (150 )
Principal payments received on direct finance lease 38 --
Proceeds from disposition of equipment 130 20,858
-----------------------------
Net cash provided by (used in) investing activities 1,722 (7,509 )
-----------------------------
Financing activities:
Proceeds from short-term note payable -- 11,220
Payments of short-term note payable (1,286 ) --
Cash distributions paid to General Partner (218 ) (219 )
Cash distributions paid to limited partners (4,144 ) (4,155 )
Repurchase of depositary units (413 ) (374 )
-----------------------------
Net cash (used in) provided by financing activities (6,061 ) 6,472
-----------------------------
Net (decrease) increase in cash and cash equivalents (1,641 ) 1,743
Cash and cash equivalents at beginning of period 3,017 2,600
=============================
Cash and cash equivalents at end of period $ 1,376 $ 4,343
=============================
Supplemental information:
Interest paid $ 502 $ 677
=============================
</TABLE>
See accompanying notes to financial
statements.
<PAGE>
PLM EQUIPMENT GROWTH FUND VI
(A Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
March 31, 1997
1. Opinion of Management
In the opinion of the management of PLM Financial Services, Inc., (FSI or
the General Partner), the accompanying unaudited financial statements contain
all adjustments necessary, consisting primarily of normal recurring accruals, to
present fairly the financial position of PLM Equipment Growth Fund VI (the
Partnership) as of March 31, 1997 and December 31, 1996; the statements of
income for the three months ended March 31, 1997 and 1996, the statements of
cash flows for the three months ended March 31, 1997 and 1996, and the
statements of changes in partners' capital for the period December 31, 1995 to
March 31, 1997. Certain information and footnote disclosures normally included
in financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted from the accompanying
financial statements. For further information, reference should be made to the
financial statements and notes thereto included in the Partnership's annual
report on Form 10-K for the year ended December 31, 1996, on file at the
Securities and Exchange Commission.
2. Reclassification
Certain amounts in the 1996 financial statements have been reclassified to
conform to the 1997 presentation.
3. Repurchase of Depositary Units
Pursuant to the Partnership repurchase plan, at December 31, 1996, the
Partnership agreed to repurchase approximately 54,000 depositary units for an
aggregate purchase price of $0.7 million. As of March 31, 1997, the Partnership
has repurchased 33,616 depositary units for $0.4 million. The General Partner
anticipates that the remaining units will be repurchased during the next three
months.
4. Cash Distributions
Cash distributions are recorded when paid and totaled $4.4 million for the three
months ended March 31, 1997. Cash distributions to limited partners in excess of
net income are considered to represent a return of capital. Cash distributions
to the limited partners of $4.1 million and $0 for the three months ended March
31, 1997 and 1996, respectively, were deemed to be a return of capital. Cash
distributions related to the results from the first quarter of 1997, of $2.4
million, were paid or are payable during April and May 1997, depending on
whether the individual limited partner elected to receive a monthly or quarterly
distribution check.
5. Investments in Unconsolidated Special Purpose Entities
The net investments in unconsolidated special purpose entities (USPEs) include
the following jointly-owned equipment (and related assets and liabilities) (in
thousands):
<TABLE>
<CAPTION>
March 31, December 31,
1997 1996
---------------------------------------------------------------------------------------------------------------
<S> <C> <C>
64% interest in a trust owning a 767-200ER commercial aircraft $ 14,722 $ 15,453
17% interest in a trust that owns six commercial aircraft 2,409 2,583
50% interest in a trust that owns four commercial aircraft 7,875 8,410
50% interest in an entity owning a container feeder vessel 3,267 3,197
20% interest in an entity owning a handymax bulk carrier 1,786 1,851
30% interest in an entity owning a mobile offshore drilling unit 5.991 6,196
40% interest in two commercial aircraft on direct finance lease 4,619 4,429
----------- -----------
Net investments $ 40,669 $ 42,119
=========== ===========
</TABLE>
<PAGE>
PLM EQUIPMENT GROWTH FUND VI
(A Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
March 31, 1997
6. General Partner and Transactions with Affiliates
Partnership management fees payable to an affiliate of the General Partner were
$248,000 and $260,000 at March 31, 1997 and December 31, 1996, respectively. The
Partnership's proportional share of USPE-affiliated management fees of $45,000
and $27,000 were payable as of March 31, 1997 and December 31, 1996,
respectively. The Partnership's proportional share of USPE-affiliated management
fees expense during the three months ended March 31, 1997 and 1996 was $93,000
and $73,000, respectively. The Partnership's proportional share of USPE data
processing and administrative expenses to affiliates was $45,000 and $14,000
during the three months ended March 31, 1997 and 1996, respectively. The
Partnership's proportional share of amounts paid by USPEs during the three
months ended March 31, 1997 and 1996, to Transportation Equipment Indemnity
Company, Ltd. (TEI), which provides marine insurance coverage for Partnership
equipment and other insurance brokerage services, was $13,000 and $11,000,
respectively. TEI is an affiliate of the General Partner.
The Partnership's proportional share of lease negotiation and equipment
acquisition fees, incurred by USPEs to PLM Worldwide Management Services (WMS)
during the three months ended March 31, 1996, was $0.6 million. No similar fees
were incurred during the same period of 1997. WMS is a wholly-owned subsidiary
of PLM International, Inc.
The balance due to affiliates at March 31, 1997, includes $0.2 million due
to FSI and its affiliates for management fees and $1.9 million due to an
affiliated USPE. The balance due to affiliates at December 31, 1996, includes
$0.3 million due to FSI and its affiliates for management fees and $1.9 million
due to an affiliated USPE.
7. Equipment
Owned equipment held for operating leases is stated at cost. The components of
equipment are as follows (in thousands):
March 31, December 31,
Equipment held for operating leases 1997 1996
----------------------------------------------------------------------------
Aircraft $ 11,919 $ 11,919
Marine vessels 41,263 41,263
Trailers 17,547 17,985
Aircraft engines and components 6,340 6,340
Marine containers 16,360 16,401
Rail equipment 15,648 15,643
----------- ------------
109,077 109,551
Less accumulated depreciation (48,866 ) (46,544 )
----------- ------------
Net equipment $ 60,211 $ 63,007
=========== ============
As of March 31, 1997, all of the equipment was on lease or operating in
PLM-affiliated short-term trailer rental facilities, except for 15 railcars. At
December 31, 1996, all of the equipment was on lease or operating in
PLM-affiliated short-term trailer rental facilities, except for six railcars.
The net book value of the equipment off lease was $0.3 million and $0.2 million
at March 31, 1997, and December 31, 1996, respectively.
During the three months ended March 31, 1997, the Partnership disposed of
or sold marine containers and trailers with an aggregate net book value of
$118,000 for $92,000. In addition, the Partnership entered into a sales-type
lease related to the sale of a group of trailers (see Note 8).
During the three months ended March 31, 1996, the Partnership disposed of
or sold marine containers and a trailer with an aggregate net book value of
$37,000 for proceeds of $100,000. The
<PAGE>
PLM EQUIPMENT GROWTH FUND VI
(A Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
March 31, 1997
7. Equipment (continued)
Partnership also sold one marine vessel that was held for sale as of December
31, 1995, with a net book value of $14.6 million at the date of sale, for
proceeds of $20.8 million. Included in the gain of $6.3 million from the sale of
the marine vessel is the unused portion of accrued drydocking of $0.1 million.
8. Net Investment in a Sales-type Lease
During the three months ended March 31, 1997, the Partnership entered into a
sales-type lease related to the sale of a group of trailers. Gross lease
payments of $0.3 million are to be received over a 39-month period, which
commenced in January of 1997. The lessee has a $1 per unit buy-out option at the
lease expiration. The sale proceeds were $234,000, resulting in a gain at lease
inception of $39,000.
The components of the net investment in the sales-type lease at March 31,
1997 are as follows:
1997
--------------
Total minimum lease payments $ 298,000
Less: Unearned income (77,000 )
==============
$ 221,000
==============
Future minimum rentals receivable under the sales-type lease at March 31,
1997 for the next 36 months are approximately $75,000 in 1997; $99,000 in 1998,
$99,000 in 1999, and $25,000 in 2000.
9. Debt
As of March 31, 1997, the Partnership had repaid its $1.3 million borrowing
under the short-term joint $50 million credit facility. Among the other eligible
borrowers, PLM Equipment Growth Fund V had $1.1 million and American Finance
Group, Inc. had $22.5 million in outstanding borrowings. Neither the
Partnership, PLM Equipment Growth Fund IV, PLM Equipment Growth & Income Fund
VII, Professional Lease Management Income Fund I, L.L.C., nor TEC Acquisub, Inc.
had any outstanding borrowings.
10. Contingencies
As more fully described by the Partnership in its Form 10-K for the year ended
December 31, 1996, PLM International, Inc. and various of its affiliates are
named as defendants in a lawsuit filed as a class action on January 22, 1997, in
the Circuit Court of Mobile County, Mobile, Alabama (Case No. CV-97-251). On
February 3, 1997, the state court filed an Order conditionally certifying the
class pursuant to the provisions of Rule 23 of the Alabama Rules of Civil
Procedure (ARCP), as requested by plaintiffs in an ex parte motion filed on
January 22, 1997. Defendants were not given notice of the motion, nor were they
given an opportunity to be heard regarding the issue of conditional class
certification. The Order specifies that the class shall consist of (with certain
narrow exceptions) all purchasers of limited partnership units in the
Partnership, PLM Equipment Growth Fund IV, PLM Equipment Growth Fund V, and PLM
Equipment Growth & Income Fund VII. In issuing the Order, the court emphasized
that the certification is conditional in accordance with Rule 23(d) of the ARCP,
and that the plaintiffs will bear the burden of proving each requisite element
of Rule 23 at the time of the evidentiary hearing on the issue of class
certification. To date, no such hearing date has been set. The defendants filed
a Notice of Removal of the lawsuit from the state court to the United States
District Court for the Southern District of Alabama, Southern Division (Civil
Action No. 97-0177-BH-C) on March 6, 1997, arguing that the parties are fully
diverse for the purposes of diversity jurisdiction pursuant to 28 U.S.C. Section
1441. The plaintiffs filed a motion to remand the class action to the state
court, and defendants have responded to this motion. Defendants do not need to
respond to the complaint until after the federal court decides the motion to
remand. PLM International, Inc. believes the allegations to be completely
without merit and intends to defend this matter vigorously.
Item 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
(I) RESULTS OF OPERATIONS
Comparison of the Partnership's Operating Results for the Three Months Ended
March 31, 1997 and 1996
(A) Owned Equipment Operations
Lease revenues less direct expenses (defined as repairs and maintenance,
equipment operation, and asset-specific insurance expenses) on owned equipment
increased during the first quarter of 1997, when compared to the same quarter of
1996. The following table presents revenues less direct expenses by owned
equipment type (in thousands):
<TABLE>
<CAPTION>
For the Three Months
Ended March 31,
1997 1996
----------------------------
<S> <C> <C>
Aircraft and aircraft engines $ 921 $ 1,074
Marine vessels 894 512
Trailers 803 775
Rail equipment 867 700
Marine containers 397 577
</TABLE>
Aircraft: Aircraft lease revenues and direct expenses were $0.9 million and
$24,000, respectively, for the three months ended March 31, 1997, compared to
$1.2 million and $82,000, respectively during the same period of 1996. The
decrease in aircraft contribution was due to the sale of two aircraft engines
during the second quarter of 1996.
Marine vessels: Marine vessel lease revenues and direct expenses were $2.3
million and $1.4 million, respectively, for the three months ended March 31,
1997, compared to $1.6 million and $1.1 million, respectively, during the same
period of 1996. The increase in marine vessel contribution was due to the
purchase of two marine vessels during the first quarter of 1996 that were on
lease for the full quarter of 1997, compared to being on lease for only a
partial month of the similar period of 1996.
Trailers: Trailer lease revenues and direct expenses were $1.0 million and $0.2
million, respectively, for the three months ended March 31, 1997, compared to
$1.1 million and $0.3 million, respectively during the same period of 1996. The
number of trailers owned by the Partnership has been declining over the past 12
months due to sales and dispositions. The result of this declining fleet has
been a decrease in trailer contribution. In addition, the trailer fleet is
experiencing lower utilization in the PLM affiliated short-term rental yards due
to soft market conditions.
Rail equipment: Rail equipment lease revenues and direct expenses were $1.0
million and $0.2 million, respectively, for the three months ended March 31,
1997, compared to $1.0 million and $0.3 million, respectively, during the same
period of 1996. Although the railcar fleet remained relatively the same size for
both quarters, the increase in railcar contribution resulted from running
repairs required on certain of the railcars in the fleet during the first
quarter of 1996, which were not needed during the same period of 1997.
Marine containers: Marine container lease revenues and direct expenses were $0.4
million and $3,000, respectively, for the three months ended March 31, 1997,
compared to $0.6 million and $4,000, respectively during the same quarter of
1996. The number of marine containers owned by the Partnership has been
declining over the past 12 months due to sales and dispositions. The result of
this declining fleet has been a decrease in marine container contribution.
(B) Indirect Expenses Related to Owned Equipment Operations
Total indirect expenses of $3.8 million for the quarter ended March 31, 1997
decreased from $4.3 million for the same period in 1996. The significant
variances are explained as follows:
(a) A $0.4 million decrease in depreciation and amortization expenses from
1996 levels reflecting the sale of certain assets during 1996 and the
double-declining balance method of depreciation.
(b) A $0.2 million increase in administrative expenses was due to
additional professional services needed in order to collect balances due to the
Partnership from certain non performing lessees.
(c) A $0.3 million decrease in the allowance for bad debts was due to the
collection of unpaid invoices that were previously reserved for as a bad debt.
(C) Net Gain on Disposition of Owned Equipment
The net gain on the disposition of equipment for the first quarter of 1997
totaled $12,000, and resulted from the sale of marine containers and trailers,
with an aggregate net book value of $247,000, for $259,000. For the first
quarter of 1996, the $6.3 million net gain on the disposition of equipment
resulted from the sale or disposal of marine containers and a trailer with an
aggregate net book value of $37,000, for an aggregate sum of $100,000, in
addition, the sale of one marine vessel that was held for sale as of December
31, 1995, with a net book value of $14.6 million for proceeds of $20.8 million.
Included in the gain of $6.3 million from the sale of the marine vessel is the
unused portion of accrued drydocking of $0.1 million.
(D) Interest and Other Income
Interest and other income decreased $179,000 during the first quarter of 1997,
due primarily to lower cash balances available for investment throughout most of
the quarter, when compared to the same period of 1996.
(E) Equity in Net Income (Loss) of Unconsolidated Special Purpose Entities
(USPEs)
Net income (loss) generated from the operation of jointly-owned assets accounted
for under the equity method is shown in the following table by equipment type
(in thousands):
<TABLE>
<CAPTION>
For the Three Months
Ended March 31,
1997 1996
----------------------------
<S> <C> <C>
Aircraft $ 227 $ (447 )
Marine vessels (107 ) 26
Mobile offshore drilling unit (11 ) (31 )
</TABLE>
Aircraft: As of March 31, 1997, the Partnership owned an interest in a Boeing
767 commercial aircraft, an interest in two commercial aircraft on a direct
finance lease and interests in two trusts that hold 10 commercial aircraft. As
of March 31, 1996, the Partnership owned an interest in a Boeing 767 commercial
aircraft, owned an interest in a trust that held seven commercial aircraft, and
had just purchased an interest in a trust which held five commercial aircraft.
During the first quarter of 1997, revenues of $1.9 million were offset by
depreciation and administrative expenses of $1.7 million. During the same period
of 1996, lease revenues of $1.1 million were offset by depreciation and
administrative expenses of $1.6 million.
Marine vessels: As of March 31, 1997 and 1996, the Partnership owned an interest
in two marine vessels. During the first quarter of 1997, revenues of $0.4
million were offset by depreciation and administrative expenses of $0.5 million.
During the same period of 1996, revenues of $0.3 million were offset by
depreciation and administrative expenses of $0.3 million. The primary reason
revenues increased was due to the purchase of one of the marine vessels during
the latter half of the first quarter of 1996. Revenues and expenses during 1997
represent a full quarter when compared to 1996; revenues and expenses are only
for a partial quarter.
Mobile offshore drilling unit: As of March 31, 1997, the Partnership owned an
interest in a mobile offshore drilling unit (rig) which was purchased during the
fourth quarter of 1996. As of March 31, 1996, the Partnership owned an interest
in a rig which was sold during the third quarter of 1996. During the first
quarter of 1997, revenues of $265,000 were offset by depreciation and
administrative expenses of $276,000. During the same period of 1996, revenues of
$276,000 were offset by depreciation and administrative expenses of $308,000.
(F) Net Income
As a result of the foregoing, the Partnership's net income of $0.2 million for
the period ended March 31, 1997, decreased from a net income of $5.4 million
during the same period in 1996. The Partnership's ability to operate and
liquidate assets, secure leases, and re-lease those assets whose leases expire
during the duration of the Partnership is subject to many factors, and the
Partnership's performance in the first quarter of 1997 is not necessarily
indicative of future periods. In the first quarter of 1997, the Partnership
distributed $4.1 million to the limited partners, or $0.50 per weighted-average
depositary unit.
(II) FINANCIAL CONDITION - CAPITAL RESOURCES, LIQUIDITY, AND DISTRIBUTIONS
For the three months ended March 31, 1997, the Partnership generated sufficient
operating cash (net cash provided by operating activities plus distributions
from unconsolidated special purpose entities) to meet its operating obligations,
maintain working capital reserves, and maintain the current level of
distributions (total for the three months ended March 31, 1997 of approximately
$4.4 million) to the partners, but used undistributed available cash from prior
periods of approximately $38,000. During the three months ended March 31, 1997,
the General Partner sold equipment for $0.1 million.
The General Partner entered into a short-term joint $50 million credit
facility. As of May 13, 1997, the Partnership did not have any borrowings with
the credit facility, having repaid its $1.3 million borrowing during January
1997, PLM Equipment Growth Fund V had $1.1 million and American Finance Group,
Inc. had $22.5 million in outstanding borrowings. Neither PLM Equipment Growth
Fund IV, PLM Equipment Growth & Income Fund VII, Professional Lease Management
Income Fund I, L.L.C., nor TEC Acquisub, Inc. had any outstanding borrowings.
(III) Outlook for the Future
Several factors may affect the Partnership's operating performance in 1997 and
beyond, including changes in the markets for the Partnership's equipment and
changes in the regulatory environment in which that equipment operates.
The Partnership's operation of a diversified equipment portfolio in a broad
base of markets is intended to reduce its exposure to volatility in individual
equipment sectors.
The ability of the Partnership to realize acceptable lease rates on its
equipment in the different equipment markets is contingent on many factors, such
as specific market conditions and economic activity, technological obsolescence,
and government or other regulations. The unpredictability of some of these
factors, or of their occurrence, makes it difficult for the General Partner to
clearly define trends or influences that may impact the performance of the
Partnership's equipment. The General Partner continuously monitors both the
equipment markets and the performance of the Partnership's equipment in these
markets. The General Partner may make an evaluation to reduce the Partnership's
exposure to equipment markets in which it determines that it cannot operate
equipment and achieve acceptable rates of return. Alternatively, the General
Partner may make a determination to enter equipment markets in which it
perceives opportunities to profit from supply/demand instabilities or other
market imperfections.
The Partnership intends to use excess cash flow, if any, after payment of
expenses, loan principal, maintain working capital reserves, and cash
distributions, to acquire additional equipment during the first seven years of
Partnership operations. The General Partner believes that these acquisitions may
cause the Partnership to generate additional earnings and cash flow for the
Partnership.
<PAGE>
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
None.
(b) Reports on Form 8-K
None.
<PAGE>
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.
PLM EQUIPMENT GROWTH FUND VI
By: PLM Financial Services, Inc.
General Partner
Date: May 13, 1997 By: /s/ David J. Davis
------------------
David J. Davis
Vice President and
Corporate Controller
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> MAR-31-1997
<CASH> 1,376
<SECURITIES> 0
<RECEIVABLES> 3,357
<ALLOWANCES> (1,028)
<INVENTORY> 0
<CURRENT-ASSETS> 0
<PP&E> 109,077
<DEPRECIATION> (48,866)
<TOTAL-ASSETS> 107,843
<CURRENT-LIABILITIES> 36,631
<BONDS> 0
<COMMON> 0
0
0
<OTHER-SE> 71,212
<TOTAL-LIABILITY-AND-EQUITY> 107,843
<SALES> 0
<TOTAL-REVENUES> 5,699
<CGS> 0
<TOTAL-COSTS> 5,611
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 502
<INCOME-PRETAX> 197
<INCOME-TAX> 0
<INCOME-CONTINUING> 197
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 197
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
