SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 1998
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE EXCHANGE ACT.
For the transition period from ___________to ___________
Commission File Number: 33-72740-FW
TRIUMPHE LEASING IX L.P.
(Exact name of small business issuer
as specified in its charter)
Illinois 36-3921954
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
630 Dundee Road, Suite 345, Northbrook, Illinois 60062
(Address of principal executive offices) (Zip Code)
847-509-1500
(Issuer's telephone number, including area code)
(Former name, former address and former fiscal year, if
changed since last report)
Check whether the issuer: (1) filed all reports required to
be filed by Sections 13 or 15(d) of the Exchange Act during
the past 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 1 of 13
<PAGE>
<TABLE>
PART I
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
TRIUMPHE LEASING IX L.P.
BALANCE SHEETS
<CAPTION>
June 30, 1998 December 31, 1997
------------- -----------------
(Unaudited)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and equivalents $ 65,607 $ 179,796
Accounts Receivable 6,587 5,328
Net investment in direct
financing leases 361,129 361,129
Prepaid expenses 1,517 -
--------- ---------
TOTAL CURRENT ASSETS 434,840 546,253
--------- ---------
COMPUTER EQUIPMENT ON OPERATING LEASES
less accumulated depreciation of
$4,416,039 and $3,295,593 2,460,737 3,579,849
--------- ---------
OTHER ASSETS:
Net investment in direct
financing leases 56,531 237,096
Deferred organization costs,
less accumulated amortization
of $22,500 and $20,000 2,500 5,000
--------- ---------
TOTAL OTHER ASSETS 59,031 242,096
--------- ---------
$ 2,954,608 $ 4,368,198
========= =========
<FN>
See accompanying notes to financial statements (Unaudited)
</TABLE>
Page 2 of 13
<PAGE>
<TABLE>
PART I
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS - CONTINUED
TRIUMPHE LEASING IX L.P.
BALANCE SHEETS
<CAPTION>
June 30, 1998 December 31, 1997
------------- -----------------
(Unaudited)
<S> <C> <C>
LIABILITIES AND PARTNERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 2,199 $ -
Current maturities of
long-term debt 2,011,271 2,228,931
Other liabilities 660 -
--------- ---------
TOTAL CURRENT LIABILITIES 2,014,130 2,228,931
--------- ---------
Accrued Management Fees 178,873 141,211
LONG-TERM DEBT,
less current maturities 418,121 1,293,545
--------- ---------
TOTAL LONG-TERM LIABILITIES 596,994 1,434,756
--------- ---------
TOTAL LIABILITIES 2,611,124 3,663,687
--------- ---------
PARTNERS' EQUITY:
General Partners 3,987 7,597
Limited Partners 339,497 696,914
--------- ---------
TOTAL PARTNERS' EQUITY 343,484 704,511
--------- ---------
$ 2,954,608 $ 4,368,198
========= =========
<FN>
See accompanying notes to financial statements (Unaudited)
</TABLE>
Page 3 of 13
<PAGE>
<TABLE>
TRIUMPHE LEASING IX L.P.
STATEMENTS OF OPERATIONS
<CAPTION>
Six Months Six Months
Ended Ended
June 30, 1998 June 30, 1997
------------- -------------
(Unaudited) (Unaudited)
<S> <C> <C>
REVENUES:
Lease Income $ 1,067,949 $1,306,260
Loss on Sale of Equipment - (229,268)
Interest 494 3,045
---------- ----------
TOTAL REVENUES 1,068,443 1,080,037
---------- ----------
OPERATING EXPENSES:
Interest 121,089 185,385
Depreciation & Amortization 1,121,612 1,158,556
Remarketing Commissions Paid
to Outside Lease Brokers - 62,091
Administrative 57,642 78,858
---------- ----------
TOTAL OPERATING EXPENSES 1,300,343 1,484,890
---------- ----------
NET LOSS $ (231,900) $(404,853)
NET LOSS ALLOCATED TO:
General Partners $ (2,319) $ (4,049)
Limited Partners (229,581) (400,804)
---------- ---------
$ (231,900) $(404,853)
========== =========
WEIGHTED AVERAGE UNITS OUTSTANDING
DURING THE PERIOD:
General Partners 1.0533 1.0345
Limited Partners 104.2761 102.4123
BASIC AND FULLY DILUTED EARNINGS PER UNIT:
General Partners $ (2,202) $ (3,914)
Limited Partners $ (2,202) $ (3,914)
<FN>
See accompanying notes to financial statements (Unaudited)
</TABLE>
Page 4 of 13
<PAGE>
<TABLE>
TRIUMPHE LEASING IX L.P.
STATEMENTS OF OPERATIONS
<CAPTION>
Three Months Three Months
Ended Ended
June 30, 1998 June 30, 1997
------------- --------------
(Unaudited) (Unaudited)
<S> <C> <C>
REVENUES:
Lease Income $ 535,306 $ 594,923
Loss on Sale of Equipment - (229,268)
Interest 494 1,283
---------- ----------
TOTAL REVENUES 535,800 366,938
---------- ----------
OPERATING EXPENSES:
Interest 55,348 87,103
Depreciation & Amortization 559,258 578,936
Remarketing Commissions Paid
to Outside Lease Brokers - 1,978
Administrative 20,984 26,988
---------- ----------
TOTAL OPERATING EXPENSES 635,590 695,005
---------- ----------
NET LOSS $ (99,790) $ (328,067)
========== ==========
NET LOSS ALLOCATED TO:
General Partners $ (998) $ (3,281)
Limited Partners (98,792) (324,786)
---------- ----------
$ (99,790) $ (328,067)
========== ==========
WEIGHTED AVERAGE UNITS OUTSTANDING
DURING THE PERIOD:
General Partners 1.0533 1.0718
Limited Partners 104.2761 106.1117
BASIC AND FULLY DILUTED EARNINGS PER UNIT:
General Partners $ (947) $ (3,061)
Limited Partners $ (947) $ (3,061)
<FN>
See accompanying notes to financial statements (Unaudited)
</TABLE>
Page 5 of 13
<PAGE>
<TABLE>
TRIUMPHE LEASING IX L.P.
STATEMENT OF PARTNERS' EQUITY
Six Months Ended June 30, 1998
(Unaudited)
<CAPTION>
GENERAL LIMITED
TOTAL PARTNERS PARTNERS
<S> <C> <C> <C>
PARTNERS' EQUITY
Beginning of period $ 704,511 $ 7,597 $ 696,914
NET LOSS (231,900) (2,319) (229,581)
DISTRIBUTIONS (129,127) (1,291) (127,836)
---------- ------- ----------
PARTNERS' EQUITY
End of period $ 343,484 $ 3,987 $ 339,497
========== ======= ==========
<FN>
See accompanying notes to financial statements (Unaudited)
</TABLE>
Page 6 of 13
<PAGE>
<TABLE>
TRIUMPHE LEASING IX L.P
STATEMENTS OF CASH FLOWS
<CAPTION>
Six Months Six Months
Ended Ended
June 30, 1998 June 30, 1997
------------- -------------
(Unaudited) (Unaudited)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss $ (231,900) $ (404,853)
Adjustments to reconcile
net loss to net cash
provided by operating activities:
Depreciation & Amortization 1,121,612 1,158,556
Amortization of unearned income - (42,891)
Loss on sale of equipment - 229,268
Changes in assets and liabilities:
(Increase) Decrease in accounts
receivable (1,259) 39,367
(Increase) in prepaid expense (1,517) (1,514)
Increase (Decrease) in
accounts payable 2,199 (7,523)
Increase in accrued management
fees 37,662 38,875
Increase in other liabilities 660 11,623
----------- ----------
Net cash provided by
operating activities 927,457 1,020,908
----------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Principal payments received under
direct financing leases 180,565 201,141
Purchase of computer equipment on
operating leases - (10,000)
Proceeds from sale of equipment - 46,220
----------- ----------
Net cash provided by
investing activities 180,565 237,361
----------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Partner capital contributions - 158,140
Distributions to partners (129,127) (118,590)
Principal payments of
nonrecourse debt (1,093,084) (1,158,190)
Offering costs paid - (3,271)
----------- -----------
Net cash used in
financing activities (1,222,211) (1,121,911)
----------- -----------
NET (DECREASE) INCREASE IN CASH AND
EQUIVALENTS (114,189) 136,358
CASH AND EQUIVALENTS,
at the beginning of the period 179,796 275,638
----------- -----------
CASH AND EQUIVALENTS,
at the end of the period $ 65,607 $ 411,996
=========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the
period for interest $ 121,089 $ 185,385
<FN>
See accompanying notes to financial statements (Unaudited)
</TABLE>
Page 7 of 13
<PAGE>
<TABLE>
TRIUMPHE LEASING IX L.P
STATEMENTS OF CASH FLOWS
<CAPTION>
Three Months Three Months
Ended Ended
June 30, 1998 June 30, 1997
------------- -------------
(Unaudited) (Unaudited)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss $ (99,790) $ (328,067)
Adjustments to reconcile
net loss to net cash
provided by operating activities:
Depreciation & Amortization 559,258 578,936
Amortization of unearned income - (20,929)
Loss on sale of equipment - 229,268
Changes in assets and liabilities:
(Increase) Decrease in accounts
receivable (6,587) 41,413
Decrease in prepaid expense 757 758
Increase (Decrease) in
accounts payable 7 (25,933)
Increase in accrued management
fees 18,805 20,739
Increase in other liabilities 660 11,869
---------- ----------
Net cash provided by
operating activities 473,110 508,054
---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Principal payments received under
direct financing leases 90,283 101,465
Purchase of computer equipment
on operating leases - (10,000)
Proceeds from sale of equipment - 46,220
---------- ----------
Net cash provided by
investing activities 90,283 137,685
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Partner capital contributions - 143,540
Distributions to partners (64,563) (59,820)
Proceeds from nonrecourse debt - -
Principal payments of
nonrecourse debt (551,739) (556,656)
Offering costs paid - (1,082)
---------- ----------
Net cash used in
financing activities (616,302) (474,018)
---------- ----------
NET (DECREASE) INCREASE IN CASH
AND EQUIVALENTS (52,909) 171,721
CASH AND EQUIVALENTS,
at the beginning of the period 118,516 240,275
---------- ----------
CASH AND EQUIVALENTS,
at the end of the period $ 65,607 $ 411,996
========== ==========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the
period for interest $ 55,348 $ 87,103
<FN>
See accompanying notes to financial statements (Unaudited)
</TABLE>
Page 8 of 13
<PAGE>
TRIUMPHE LEASING IX L.P.
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - FINANCIAL INFORMATION
The financial information included herein at June 30, 1998
and the six and three months ended June 30, 1998, and June 30,
1997, is unaudited and, in the opinion of the partnership,
reflects all adjustments (which include only normal recurring
adjustments) necessary for the fair presentation of the financial
position as of that date and the results of operations for
those periods.
The results for interim periods are not necessarily
indicative of trends or of results to be expected for a full
year.
NOTE 2 - ORGANIZATION
The partnership was formed on November 30, 1993, under the
Revised Uniform Limited Partnership Act of the State of Illinois.
The partnership's business is to acquire, own, lease, maintain,
manage and sell equipment. The quarter ended June 30, 1998 was
the eighteenth quarter of operations of the partnership and
leased equipment was acquired during this period.
NOTE 3 - PREPAID EXPENSES
The prepaid syndication and organization costs are costs
that are attributable to the formation and organization of the
partnership. These costs are ultimately expected to be
approximately $150,000. The portion of these costs which are
attributable to organization costs will be amortized using the
straight-line method over a sixty-month period.
NOTE 4 - DESCRIPTION OF LEASING ARRANGEMENTS
The partnership's leasing operations consist principally of
leased equipment which it has acquired from third-party
independent lease brokers. It is the partnership's intention to
re-lease such equipment to the existing lessee, lease such
equipment to a new lessee, or to sell the equipment at the end of
each lease. The leases will expire over the next five years.
The cost of each lease includes an equity investment plus any
non-recourse loans obtained to finance the purchase.
NOTE 5 - EQUIPMENT
Computer equipment on operating leases is recorded at cost.
Depreciation is computed using the double declining balance
method over the estimated useful lives of the assets (five
years).
Page 9 of 13
<PAGE>
TRIUMPHE LEASING IX L.P.
NOTES TO FINANCIAL STATEMENTS
NOTE 6 - LEASES
The following lists the components of the
net investment in leases as of June 30, 1998:
Total minimum lease payments to be received $ 404,282
Estimated residual values of leased property 13,378
Less: Unearned income -
---------
Net investment in leases $ 417,660
=========
At June 30, 1998, minimum lease payments for direct
financing and operating leases for each of the four succeeding
calendar years are expected to be received as follows:
YEAR AMOUNT
1999 1,305,753
2000 135,918
Page 10 of 13
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The Partnership commenced the offering of units and began
operations on January 31, 1994. As of June 30, 1998 the
partnership had sold $2,090,465 in Investor Limited Partner
Units. As of June 30, 1998 the partnership acquired leased
equipment of $10,707,925 with an equity investment of $1,797,612
and non-recourse bank borrowing of $8,910,313.
OPERATIONS
Total revenues decreased to $1,068,443 for the first two quarters
of the fiscal year ending December 31, 1998 ("fiscal 1998") from
$1,080,037 for the first two quarters of the fiscal year ended
December 31, 1997 ("fiscal 1997"). Total revenues consist of
lease rental income, net loss on sale of equipment, and interest
earned on short-term money market investments. The decrease in
total revenues was primarily attributable to additional leased
equipment being purchased, and interest earned on funds held for
investment.
Operating expenses decreased to $1,300,343 for the first two
quarters of fiscal 1998 from $1,484,890 for the first two
quarters of fiscal 1997. Operating expenses consist of interest
on nonrecourse financing of equipment purchased, depreciation of
equipment, amortization of organization expenses, remarketing
commissions, and administrative expenses. The decrease in
operating expenses resulted primarily from a decrease in
depreciation expense and the lack of remarketing expense paid in
1998.
Results for the period are not indicative of future annual
results because the partnership is still investing in equipment.
Future results of operations will depend upon rates of return
achieved on equipment acquisitions and rates achieved on
short-term money market investments.
LIQUIDITY AND CAPITAL RESOURCES
Liquid assets of the partnership increase as offering proceeds
are collected and decrease as the partnership makes equipment
investments. Cash and cash equivalents of the partnership at
June 30, 1998 include offering proceeds available for investment
in equipment and undistributed cash earned during the period from
January 31, 1994 to June 30, 1998.
The partnership generally financed the purchase of equipment by
the use of loans in an amount in excess of 85% of the purchase
price thereof. All of the loans incurred were non-recourse to
the partnership and were or will be fully amortized by the
monthly rental payments due to the partnership under related
leases.
The partnership's current cash and working capital position are
sufficient to meet the partnership's current short-term and
long-term liquidity requirements without additional financing.
Notwithstanding the foregoing, in the event that the partnership
sells additional units pursuant to this offering, there is no
assurance that the partnership will be able to obtain sufficient
debt financing to make equipment investments with the degree of
leverage that it has employed to date.
The partnership maintains, to the extent practicable, a working
capital and contingency reserve in an amount not to exceed 1% of
the gross proceeds from the offering of units, subject to
business and distribution requirements. Such amount, together
with any amount reserved from operations, will be available to
meet working capital requirements and to provide for
contingencies.
Page 11 of 13
<PAGE>
TRIUMPHE LEASING IX L.P.
PART II - OTHER INFORMATION
NONE
Page 12 of 13
<PAGE>
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.
TRIUMPHE LEASING IX L.P.
By: TL GENERAL IX CORP.,
Its: General Partner
Date August 5, 1998 By: /s/ Gerald A. Horwitz
------------------------
Gerald A. Horwitz, President
(Principal Executive Officer)
Date August 5, 1998 By: /s/ Jerry L. Schwartz
------------------------
Jerry L. Schwartz,
Vice President,
Secretary and Treasurer
(Principal Financial and
Accounting Officer)
Date August 5, 1998 By: /s/ Gerald A. Horwitz
------------------------
Gerald A. Horwitz
Its: General Partner
Page 13 of 13
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> Dec-31-1998
<PERIOD-START> Jan-01-1998
<PERIOD-END> Jun-30-1998
<CASH> 65,607
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 434,840
<PP&E> 6,876,776
<DEPRECIATION> 4,416,039
<TOTAL-ASSETS> 2,954,608
<CURRENT-LIABILITIES> 2,014,130
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 2,954,608
<SALES> 0
<TOTAL-REVENUES> 1,068,443
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 121,089
<INCOME-PRETAX> (231,900)
<INCOME-TAX> 0
<INCOME-CONTINUING> (231,900)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
