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 period ended March 31, 2000
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[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the transition period from to
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Commission File Number 0-27912
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ICON Cash Flow Partners, L.P., Series E
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(Exact name of registrant as specified in its charter)
Delaware 13-3635208
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(State or other jurisdiction of (IRS Employer Identification Number)
incorporation or organization)
111 Church Street, White Plains, New York 10601-1505
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(Address of principal executive offices) (Zip code)
(914) 993-1700
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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
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
[ x ] Yes [ ] No
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
ICON Cash Flow Partners, L.P., Series E
(A Delaware Limited Partnership)
Consolidated Balance Sheets
(unaudited)
<TABLE>
March 31, December 31,
2000 1999
Assets
<S> <C> <C>
Cash ............................................ $ 1,894,653 $ 2,073,759
------------ ------------
Investment in finance leases
Minimum rents receivable ..................... 24,193,923 26,598,335
Estimated unguaranteed residual values ....... 8,399,722 8,420,547
Unearned income .............................. (4,179,839) (4,853,392)
Allowance for doubtful accounts .............. (1,237,909) (1,237,909)
------------ ------------
27,175,897 28,927,581
Investment in financings
Receivables due in installments .............. 16,877,736 18,214,488
Unearned income .............................. (2,089,246) (2,438,302)
Allowance for doubtful accounts .............. (735,231) (735,231)
------------ ------------
14,053,259 15,040,955
------------ ------------
Investment in operating leases
Equipment, at cost ........................... 20,707,984 20,707,984
Accumulated depreciation ..................... (4,143,986) (3,997,183)
------------ ------------
16,563,998 16,710,801
Investments in unconsolidated joint ventures .... 813,314 818,191
------------ ------------
Other assets .................................... 1,200,163 1,259,331
------------ ------------
Total assets .................................... $ 61,701,284 $ 64,830,618
============ ============
(continued on next page)
</TABLE>
<PAGE>
ICON Cash Flow Partners, L.P., Series E
(A Delaware Limited Partnership)
Consolidated Balance Sheets (Continued)
(unaudited)
<TABLE>
March 31, December 31,
2000 1999
Liabilities and Partners' Equity
<S> <C> <C>
Notes payable - securitized debt ........................ $ 22,823,872 $ 25,691,428
Notes payable - non-recourse ............................ 19,745,191 21,127,810
Security deposits, deferred credits and other payables .. 4,312,344 2,758,365
Minority interests in consolidated joint ventures ....... 531,168 560,626
------------ ------------
47,412,575 50,138,229
Commitments and Contingencies
Partners' equity (deficiency)
General Partner ...................................... (376,974) (372,938)
Limited partners (607,856 units outstanding,
$100 per unit original issue price in 2000 and 1999,
respectively) ...................................... 14,665,683 15,065,327
------------ ------------
Total partners' equity .................................. 14,288,709 14,692,389
------------ ------------
Total liabilities and partners' equity .................. $ 61,701,284 $ 64,830,618
============ ============
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
ICON Cash Flow Partners, L.P., Series E
(A Delaware Limited Partnership)
Consolidated Statements of Operations
For the Three Months Ended March 31,
(unaudited)
<TABLE>
2000 1999
---- ----
Revenue
<S> <C> <C>
Finance income ......................................... $1,020,894 $1,750,258
Rental income .......................................... 615,000 615,000
Gain on sales of equipment ............................. 131,363 114,684
Income from investments in unconsolidated joint ventures 30,992 101,811
Interest income and other .............................. 30,534 67,737
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Total revenues ......................................... 1,828,783 2,649,490
---------- ----------
Expenses
Interest ............................................... 798,821 1,162,697
Management fees - General Partner ...................... 176,232 233,637
General and administrative ............................. 161,895 204,319
Depreciation ........................................... 146,803 146,803
Administrative expense reimbursements - General Partner 117,963 139,838
Minority interest expense in consolidated joint ventures 57,841 93,463
Other .................................................. 5,392 11,946
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Total expenses ......................................... 1,464,947 1,992,703
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Net income ................................................ $ 363,836 $ 656,787
========== ==========
Net income allocable to:
Limited partners ....................................... $ 360,198 $ 650,219
General Partner ........................................ 3,638 6,568
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$ 363,836 $ 656,787
========== ==========
Weighted average number of limited
partnership units outstanding ............................. 607,856 607,856
========== ==========
Net income per weighted average
limited partnership unit .................................. $ .59 $ 1.07
========== ==========
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
ICON Cash Flow Partners, L.P., Series E
(A Delaware Limited Partnership)
Consolidated Statements of Changes in Partners' Equity
For the Three Months Ended March 31, 2000 and the
Year Ended December 31, 1999
(unaudited)
<TABLE>
Limited Partner Distributions
Return of Investment Limited General
Capital Income Partners Partner Total
(Per weighted average unit)
<S> <C> <C> <C> <C> <C>
Balance at
December 31, 1998 $17,227,175 $(351,105) $16,876,070
Cash distributions
to partners $3.56 $3.65 (4,381,933) (44,258) (4,426,191)
Net income 2,220,085 22,425 2,242,510
----------- --------- -----------
Balance at
December 31, 1999 15,065,327 (372,938) 14,692,389
Cash distributions
to partners $ .66 $ .59 (759,842) (7,674) (767,516)
Net income 360,198 3,638 363,836
----------- --------- -----------
Balance at
March 31, 2000 $14,665,683 $(376,974) $14,288,709
=========== ========= ===========
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
ICON Cash Flow Partners, L.P., Series E
(A Delaware Limited Partnership)
Consolidated Statements of Cash Flows
For the Three Months Ended March 31,
(unaudited)
<TABLE>
2000 1999
---- ----
Cash flows provided by operating activities:
<S> <C> <C>
Net income ............................................................ $ 363,836 $ 656,787
----------- -----------
Adjustments to reconcile net income to net
cash provided by operating activities:
Depreciation ....................................................... 146,803 146,803
Rental income - paid directly to lenders by lessees ................ (615,000) (615,000)
Finance income portion of receivables paid directly
to lenders by lessees ........................................... (269,156) (605,544)
Amortization of initial direct costs ............................... -- 11,946
Net gain on sales of equipment ..................................... (131,363) (114,684)
Interest expense on non-recourse financing paid
directly by lessees ............................................. 422,025 611,442
Income from investments in unconsolidated joint ventures ........... (30,992) (101,811)
Changes in operating assets and liabilities:
Collection of principal - non-financed receivables .............. 2,630,406 2,926,329
Distributions received from unconsolidated joint ventures ....... 35,870 158,723
Security deposits, deferred credits and other payables .......... 1,553,979 (325,505)
Accounts receivable from General Partner and affiliates, net ..... -- 194,297
Other assets .................................................... 59,168 (103,563)
Minority interests in consolidated joint ventures ............... (29,458) 74,903
Other, net ...................................................... (972,550) (32,177)
----------- -----------
Total adjustments ............................................. 2,799,732 2,226,159
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Net cash provided by operating activities ..................... 3,163,568 2,882,946
----------- -----------
Cash flows from investing activities:
Proceeds from sales of equipment ...................................... 292,398 1,711,972
Equipment and receivables purchased ................................... --
----------- -----------
Net cash provided by (used in) investing activities ........... 292,398 1,711,972
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(continued on next page)
<PAGE>
ICON Cash Flow Partners, L.P., Series E
(A Delaware Limited Partnership)
Consolidated Statements of Cash Flows (Continued)
For the Three Months Ended March 31,
(unaudited)
2000 1999
---- ----
Cash flows from financing activities:
Principal payments on securitized debt (2,867,556) (2,591,470)
Cash distributions to partners (767,516) (1,547,798)
Proceeds from warehouse line of credit - -
Principal payments on warehouse line of credit - -
Redemption of limited partnership units - -
---------------- ------------
Net cash provided by (used in) financing activities (3,635,072) (4,139,268)
---------------- ---------------
Net increase (decrease) in cash (179,106) 455,650
Cash at beginning of period 2,073,759 2,336,094
---------------- ---------------
Cash at end of period $ 1,894,653 $ 2,791,744
================ ===============
</TABLE>
See accompanying notes to consolidated financial statements.
<PAGE>
ICON Cash Flow Partners, L.P., Series E
(A Delaware Limited Partnership)
Consolidated Statements of Cash Flows (Continued)
Supplemental Disclosures of Cash Flow Information
During the three months ended March 31, 2000 and 1999, non-cash activities
included the following:
<TABLE>
2000 1999
---- ----
Principal and interest on direct finance receivables
<S> <C> <C>
paid directly to lenders by lessees ............. $ 1,804,645 $ 1,846,977
Rental income assigned operating lease receivable .. 615,000 615,000
Principal and interest on non-recourse financing
paid directly by lessees ........................ (2,419,645) (2,461,977)
----------- -----------
$ -- $ --
=========== ===========
</TABLE>
Interest expense of $798,821 and $1,162,697 for the three months ended
March 31, 2000 and 1999 consisted of: interest expense on non-recourse financing
accrued or paid directly to lenders by lessees of $376,795 and $611,442,
respectively, interest expense on secured debt of $422,026 in 2000 and interest
expense on warehouse line of credit of $551,255 in 1999.
<PAGE>
ICON Cash Flow Partners, L.P., Series E
(A Delaware Limited Partnership)
Notes to Unaudited Consolidated Financial Statements
March 31, 2000
1. Basis of Presentation
The consolidated financial statements of ICON Cash Flow Partners, L.P.,
Series E (the "Partnership") have been prepared pursuant to the rules and
regulations of the Securities and Exchange Commission (the "SEC") and, in the
opinion of management, include all adjustments (consisting only of normal
recurring accruals) necessary for a fair statement of income for each period
shown. Certain information and footnote disclosures normally included in
consolidated financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted pursuant to such SEC rules
and regulations. Management believes that the disclosures made are adequate to
make the information presented not misleading. The results for the interim
period are not necessarily indicative of the results for the full year. These
consolidated financial statements should be read in conjunction with the
consolidated financial statements and notes included in the Partnership's 1999
Annual Report on Form 10-K.
2. Disposition Period
The Partnership's reinvestment period ended on July 31, 1998. The
disposition period commenced on August 1, 1998. During the disposition period
the Partnership has and will continue to distribute substantially all
distributable cash from operations and equipment sales to the partners and
continue the orderly termination of its operations and affairs. The Partnership
will not invest in any additional finance or lease transactions during the
disposition period. During the disposition period, the Partnership expects to
recover, at a minimum, the carrying value of its assets.
3. Related Party Transactions
Fees paid or accrued by the Partnership to the General Partner or its
affiliates for the three months ended March 31, 2000 and 1999 are as follows:
2000 1999
---- ----
Management fees $176,232 $233,637 Charged to operations
Administrative expense
reimbursements 117,963 139,838 Charged to operations
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Total $294,195 $373,475
======== ========
The Partnership has investments in five joint ventures with other
partnerships sponsored by the General Partner. (See Note 4 for additional
information relating to the joint ventures.)
<PAGE>
ICON Cash Flow Partners, L.P., Series E
(A Delaware Limited Partnership)
Notes to Unaudited Consolidated Financial Statements - Continued
4. Investments in Joint Ventures
The Partnership and affiliates formed five joint ventures for the purpose
of acquiring and managing various assets.
The two joint ventures described below are majority owned and are
consolidated with the Partnership.
ICON Cash Flow Partners L.L.C. I
In September 1994 the Partnership and an affiliate, ICON Cash Flow Partners
L.P. Six ("L.P. Six"), formed a joint venture, ICON Cash Flow Partners, L.L.C. I
("ICON Cash Flow LLC I"), for the purpose of acquiring and managing an aircraft.
The Partnership and L.P. Six contributed 99% and 1% of the cash required for
such acquisition, respectively, to ICON Cash Flow LLC I. The Partnership's
consolidated financial statements include 100% of the assets and liabilities of
ICON Cash Flow LLC I. L.P. Six's investment in ICON Cash Flow LLC I has been
reflected as "Minority interests in consolidated joint ventures."
ICON Receivables 1997-B L.L.C.
In August 1997 the Partnership, L.P. Six and ICON Cash Flow Partners
L.P. Seven ("L.P. Seven") formed 1997-B, a special purpose entity formed for the
purpose of originating leases and securitizing its portfolio. The Partnership,
L.P. Six and L.P. Seven contributed $2,250,000 (75.00% interest), $250,000
(8.33% interest) and $500,000 (16.67% interest), respectively to 1997-B. In
order to fund the acquisition of leases, 1997-B obtained a warehouse borrowing
facility from Prudential Securities Credit Corporation. In October 1998, 1997-B
completed an equipment securitization. The net proceeds from the securitization
of these assets were used to pay-off the remaining 1997-B warehouse facility
balance and any remaining proceeds were distributed to the 1997-B members in
accordance with their membership interests. The Partnership's consolidated
financial statements include 100% of the assets and liabilities of 1997-B. L.P.
Six and L.P. Seven's interests in 1997-B have been reflected as "minority
interests in consolidated joint ventures."
The three joint ventures described below are less than 50% owned and are
accounted for following the equity method.
ICON Cash Flow Partners L.L.C. II
In March 1995 the Partnership and L.P. Six formed a joint venture, ICON
Cash Flow Partners L.L.C. II ("ICON Cash Flow LLC II"), for the purpose of
acquiring and managing an aircraft. The Partnership and L.P. Six contributed 1%
and 99% of the cash required for such acquisition, respectively, to ICON Cash
Flow LLC II. The Partnership's investment in the joint venture is accounted for
under the equity method.
<PAGE>
ICON Cash Flow Partners, L.P., Series E
(A Delaware Limited Partnership)
Notes to Unaudited Consolidated Financial Statements - Continued
Information as to the unaudited financial position and results of
operations of ICON Cash Flow LLC II at March 31, 2000 is summarized below:
March 31, 2000
Assets $ 15,351,943
===============
Liabilities $ 9,190,696
===============
Equity $ 6,161,247
===============
Partnership's share of equity $ 61,612
===============
Three Months Ended
March 31, 2000
Net income $ 255,144
===============
Partnership's share of net income $ 2,551
===============
ICON Cash Flow L.L.C. III
In December 1996 the Partnership and an affiliate, ICON Cash Flow Partners,
L.P. Seven ("L.P. Seven"), formed a joint venture, ICON Cash Flow Partners
L.L.C. III ("ICON Cash Flow LLC III"), for the purpose of acquiring and managing
an aircraft. The Partnership and L.P. Seven contributed 1% and 99% of the cash
required for such acquisition, respectively, to ICON Cash Flow LLC III. The
Partnership's investment in the joint venture is accounted for under the equity
method.
Information as to the unaudited financial position and results of
operations of ICON Cash Flow LLC III at March 31, 2000 is summarized below:
March 31, 2000
Assets $ 8,993,967
===============
Liabilities $ 5,023,967
===============
Equity $ 3,970,000
===============
Partnership's share of equity $ 39,700
===============
Three Months Ended
March 31, 2000
Net income $ 124,200
===============
Partnership's share of net income $ 1,242
===============
<PAGE>
ICON Cash Flow Partners, L.P., Series E
(A Delaware Limited Partnership)
Notes to Unaudited Consolidated Financial Statements - Continued
ICON Receivables 1997-A L.L.C.
In March 1997 three affiliates of the Partnership, ICON Cash Flow Partners,
L.P., Series D ("Series D"), L.P. Six and L.P. Seven, contributed and assigned
equipment lease and finance receivables and residuals to ICON Receivables 1997-A
L.L.C. ("1997-A"), a special purpose entity created for the purpose of
originating leases, managing existing contributed assets and securitizing its
portfolio. In September 1997 the Partnership, L.P. Six and L.P. Seven
contributed and assigned additional equipment lease and finance receivables and
residuals to 1997-A. The Partnership, Series D, L.P. Six and L.P. Seven received
a 31.19%, 17.81%, 31.03% and 19.97% interest, respectively, in 1997-A based on
the present value of their related contributions. In September 1997, 1997-A
securitized substantially all of its equipment leases and finance receivables
and residuals. 1997-A became the beneficial owner of a trust. The Partnership's
original investment was recorded at cost and is adjusted by its share of
earnings, losses and distributions thereafter.
Information as to the unaudited financial position and results of
operations of 1997-A at March 31, 2000 is summarized below:
March 31, 2000
Assets $ 15,925,164
================
Liabilities $ 12,532,729
================
Equity $ 3,392,435
================
Partnership's share of equity $ 712,002
================
Three Months Ended
March 31, 2000
Net income $ 87,204
================
Partnership's share of net income $ 27,199
================
Distributions$ 115,000
Partnership's share of distributions $ 35,870
================
<PAGE>
ICON Cash Flow Partners, L.P., Series E
(A Delaware Limited Partnership)
March 31, 2000
Item 2. General Partner's Discussion and Analysis of Financial Condition and
Results of Operations
The Partnership's portfolio consisted of a net investment in finance
leases, financings, operating leases, and investments in unconsolidated joint
ventures representing 47%, 24%, 27%, and 1% of total investments at March 31,
2000, respectively, and 50%, 27%, 22% and 1% of total investments at March 31,
1999, respectively.
Results of Operations
Three Months Ended March 31, 2000 and 1999
Revenues for the three months ended March 31, 2000 were $1,828,783
representing a decrease of $820,707 from 1999. The decrease in revenues resulted
primarily from a decrease in income from investments in unconsolidated joint
ventures of $70,819, a decrease in interest income and other of $37,203 and a
decrease in finance income of $729,364. These decreases were partially offset by
an increase in gain on sales of equipment of $16,679. Finance income decreased
due to a decrease in the average size of the finance lease portfolio from 1999
to 2000. The increase in gain on sales of equipment resulted from an increase in
the number of leases maturing and an increase in the amount of underlying
equipment being sold for which proceeds received were in excess of the remaining
carrying value. Interest income decreased due to a decrease in the average cash
balance from 1999 to 2000. The decrease in income from investments in
unconsolidated joint ventures was the result of a decrease in the average size
of the lease portfolio of one of the underlying joint ventures, ICON Receivables
1997-A.
Expenses for the three months ended March 31, 2000 were $1,464,947
representing a decrease of $527,756 from 1999. The decrease was due to a
decrease in minority expense in consolidated joint ventures of $35,622, a
decrease in interest of $363,876, a decrease in management fees of $57,405, a
decrease in general and administrative of $42,424 and a decrease in
administrative expense reimbursements of $21,875. The decreases in management
fees and administrative expense reimbursements were a result of a decrease in
the average size of the portfolio. Interest expense decreased due to a decrease
in the average debt outstanding from 1999 to 2000. The decrease in general and
administrative expenses was due primarily to the decreases in income and
portfolio levels from 1999 to 2000.
Net income for the three months ended March 31, 2000 and 1999 was $363,836
and $656,787, respectively. The net income per weighted average limited
partnership unit was $.59 and $1.07 for 2000 and 1999, respectively.
<PAGE>
ICON Cash Flow Partners, L.P., Series E
(A Delaware Limited Partnership)
Liquidity and Capital Resources
The Partnership's primary sources of funds for the three months ended
March 31, 2000 and 1999 were net cash provided by operations of $3,163,568 and
$2,882,945, respectively, and proceeds from sales of equipment of $292,398 and
$1,711,972, respectively. These funds were used to fund cash distributions and
make payments on borrowings.
Cash distributions to limited partners for the three months ended March
31, 2000 and 1999, which were paid monthly, totaled $759,842 and $1,532,320,
respectively, of which $360,198 and $650,219 was investment income and $399,644
and $882,101 was a return of capital, respectively.
The Partnership's reinvestment period ended on July 31, 1998. The
disposition period began August 1, 1998, at which time the Partnership began the
orderly termination of its operations and affairs. During the disposition period
the Partnership has, and will continue to distribute substantially all
distributable cash from operations and equipment sales to the partners. The
Partnership has not, and will not invest in any additional finance or lease
transactions during the disposition period. As a result of the Partnership's
entering into the disposition period, future monthly distributions could, and
are expected to fluctuate depending on the amount of asset sale and re-lease
proceeds received during that period.
As of March 31, 2000, except as noted above, there were no known trends or
demands, commitments, events or uncertainties which are likely to have a
material effect on liquidity. As cash is realized from operations and sales of
equipment, the Partnership will distribute substantially all available cash,
after retaining sufficient cash to meet its reserve requirements and recurring
obligations.
<PAGE>
ICON Cash Flow Partners, L.P., Series E
(A Delaware Limited Partnership)
PART II - OTHER INFORMATION
Item 6 - Exhibits and Reports on Form 8-K
No reports on Form 8-K were filed by the Partnership during the quarter ended
March 31, 2000.
<PAGE>
ICON Cash Flow Partners, L.P., Series E
(A Delaware Limited Partnership)
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.
ICON Cash Flow Partners, L.P., Series E
File No. 33-44413 (Registrant)
By its General Partner,
ICON Capital Corp.
May 12, 2000 /s/ Thomas W. Martin
- ------------ -------------------------------------------------
Date Thomas W. Martin
Executive Vice President
(Principal financial and accounting officer of
the General Partner of the Registrant)
