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 September 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)
(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>
September 30, 1998 December 31, 1997
------------------ -----------------
(Unaudited)
<S> <C> <C>
ASSETS
CURRENT ASSETS:
Cash and equivalents $ 57,462 $ 179,796
Accounts receivable 6,587 5,328
Net investment in direct
financing leases 282,616 361,129
Prepaid expenses 758 -
----------- -----------
TOTAL CURRENT ASSETS 347,423 546,253
----------- -----------
COMPUTER EQUIPMENT ON OPERATING LEASES,
less accumulated depreciation of
$4,977,144 and $3,295,593 1,899,632 3,579,849
----------- -----------
OTHER ASSETS:
Net investment in direct
financing leases 44,762 237,096
Deferred organization costs,
less accumulated amortization
of $23,750 and $20,000 1,250 5,000
----------- -----------
TOTAL OTHER ASSETS 46,012 242,096
----------- -----------
$ 2,293,067 $ 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>
September 30, 1998 December 31, 1997
------------------ -----------------
(Unaudited)
<S> <C> <C>
LIABILITIES AND PARTNERS' EQUITY
CURRENT LIABILITIES:
Accounts payable $ 2,558 $ -
Current maturities of
long-term debt 1,615,603 2,228,931
Other liabilities 594 -
----------- -----------
TOTAL CURRENT LIABILITIES 1,618,755 2,228,931
----------- -----------
LONG-TERM DEBT,
less current maturities 251,336 1,293,545
Accrued Management Fees 197,679 141,211
----------- -----------
TOTAL LONG-TERM LIABILITES 449,015 1,434,756
----------- -----------
TOTAL LIABILITIES 2,067,770 3,663,687
----------- -----------
PARTNERS' EQUITY:
General Partners 2,805 7,597
Limited Partners 222,492 696,914
----------- -----------
TOTAL PARTNERS' EQUITY 225,297 704,511
----------- -----------
$ 2,293,067 $ 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>
Nine Months Nine Months
Ended Ended
September 30, 1998 September 30, 1997
------------------ ------------------
(Unaudited) (Unaudited)
<S> <C> <C>
REVENUES:
Lease Income $ 1,608,437 $ 1,898,264
Loss on sale of equipment - (229,268)
Interest 1,037 4,358
----------- -----------
TOTAL REVENUES 1,609,474 1,673,354
----------- -----------
OPERATING EXPENSES:
Interest 165,723 269,119
Depreciation & Amortization 1,683,967 1,789,404
Remarketing Commissions Paid
to Outside Lease Brokers 62,091
Administrative 77,607 104,467
----------- -----------
TOTAL OPERATING EXPENSES 1,927,297 2,225,081
----------- -----------
NET LOSS $ (317,823) $ (551,727)
=========== ===========
NET LOSS ALLOCATED TO:
General Partners $ (3,178) $ (5,517)
Limited Partners (314,645) (546,210)
----------- -----------
$ (317,823) $ (551,727)
=========== ===========
WEIGHTED AVERAGE UNITS OUTSTANDING
DURING THE PERIOD:
General Partners 1.0470 1.0470
Limited Partners 103.6548 103.6548
BASIC AND FULLY DILUTED EARNINGS PER UNIT:
General Partners $ (3,017) $ (5,269)
Limited Partners $ (3,017) $ (5,269)
<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
September 30, 1998 September 30, 1997
------------------ ------------------
(Unaudited) (Unaudited)
<S> <C> <C>
REVENUES:
Lease Income $ 540,488 $ 592,004
Interest 543 1,313
----------- -----------
TOTAL REVENUES 541,031 593,317
----------- -----------
OPERATING EXPENSES:
Interest 44,634 83,734
Depreciation & Amortization 562,355 630,847
Administrative 19,965 25,609
----------- -----------
TOTAL OPERATING EXPENSES 626,954 740,190
----------- -----------
NET LOSS $ (85,923) $ (146,873)
=========== ===========
NET LOSS ALLOCATED TO:
General Partners $ (859) $ (1,469)
Limited Partners (85,064) (145,404)
----------- -----------
$ (85,923) $ (146,873)
=========== ===========
WEIGHTED AVERAGE UNITS OUTSTANDING
DURING THE PERIOD:
General Partners 1.0721 1.0721
Limited Partners 106.1399 106.1399
BASIC AND FULLY DILUTED EARNINGS PER UNIT:
General Partners $ (816) $ (1,370)
Limited Partners $ (816) $ (1,370)
<FN>
See accompanying notes to financial statements (Unaudited)
</TABLE>
Page 5 of 13
<PAGE>
<TABLE>
TRIUMPHE LEASING IX L.P.
STATEMENT OF PARTNERS' EQUITY
Nine Months Ended September 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 (317,823) (3,178) (314,645)
DISTRIBUTION (161,391) (1,614) (159,777)
----------- -------- -----------
PARTNERS' EQUITY
End of period $ 225,297 $ 2,805 $ 222,492
=========== ======== ===========
<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>
Nine Months Nine Months
Ended Ended
September 30, 1998 September 30, 1997
------------------ ------------------
(Unaudited) (Unaudited)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (317,823) $ (551,727)
Adjustments to reconcile
net loss to net cash
provided by operating
activities:
Depreciation & amortization 1,683,967 1,789,404
Amortization of unearned
income - (29,399)
Loss on sale of equipment - 229,268
Changes in assets and liabilities:
Increase in accounts
receivable (1,259) (90,092)
Increase in prepaid expenses (758) (757)
Increase (Decrease) in
accounts payable 2,558 (8,580)
Increase in accrued management
fees 56,468 47,811
Increase in other liabilities 594 9,228
---------- ----------
Net cash provided by
operating activities 1,423,747 1,395,156
---------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Principal payments received under
direct financing leases 270,847 279,656
Purchase of computer equipment
on operating leases - (213,630)
Purchase of direct financing
leases - (24,000)
Proceeds from sale of
equipment - 46,220
---------- ----------
Net cash provided by
investing activities 270,847 88,246
---------- ----------
CASH FLOWS FROM FINANCING ACTIVITIES:
Partner capital contributions - 158,140
Distributions to partner (161,391) (183,103)
Principal payments of
nonrecourse debt (1,655,537) (1,534,421)
Offering costs paid - (3,771)
----------- -----------
Net cash used in
financing activities (1,816,928) (1,563,155)
----------- -----------
NET DECREASE IN CASH
AND EQUIVALENTS (122,334) (79,753)
CASH AND EQUIVALENTS,
at the beginning of the period 179,796 275,638
----------- -----------
CASH AND EQUIVALENTS,
at the end of the period $ 57,462 $ 195,885
=========== ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the
period for interest $ 165,723 $ 269,119
<FN>
See accompanying notes to financial statements (Unaudited)
Page 7 of 13
<PAGE>
TRIUMPHE LEASING IX L.P
STATEMENTS OF CASH FLOWS
<CAPTION>
Three Months Three Months
Ended Ended
September 30, 1998 September 30, 1997
------------------ ------------------
(Unaudited) (Unaudited)
<S> <C> <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss $ (85,923) $ (146,873)
Adjustments to reconcile
net loss to net cash
provided by operating
activities:
Depreciation & amortization 562,355 630,847
Amortization of unearned income - 13,492
Changes in assets and liabilities:
Increase in accounts receivable - (129,459)
Increase in prepaid expense 759 757
Increase (Decrease) in accounts
payable 359 (1,057)
Increase in accrued management
fees 18,806 8,936
Decrease in other liabilities (66) (2,395)
----------- ----------
Net cash provided by
operating activities 496,290 374,248
----------- ----------
CASH FLOWS FROM INVESTING ACTIVITIES:
Principal payments received under
direct financing leases 90,282 78,515
Purchase of computer equipment on
operating leases - (203,630)
Purchase of direct
financing leases - (24,000)
----------- ----------
Net cash provided by (used in)
investing activities 90,282 (149,115)
CASH FLOWS FROM FINANCING ACTIVITIES:
Distributions to partners (32,264) (64,513)
Principal payments of
nonrecourse debt (562,453) (376,231)
Offering costs paid - (500)
---------- ----------
Net cash used in
financing activities (594,717) (441,244)
---------- ----------
NET DECREASE IN CASH
AND EQUIVALENTS (8,145) (216,111)
CASH AND EQUIVALENTS,
at the beginning of the period 65,607 411,996
---------- ----------
CASH AND EQUIVALENTS,
at the end of the period $ 57,462 $ 195,885
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid during the
period for interest $ 44,634 $ 83,734
<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 September 30,
1998 and the nine and three months ended September 30, 1998, and
September 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 September
30, 1998 was the nineteenth quarter of operations of the
partnership and leased equipment was acquired during this period.
NOTE 3 - DEFERRED ORGANIZATION COSTS
Deferred organization costs are costs
that are attributable to the formation and organization of the
partnership. These 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
nonrecourse 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 September 30, 1998:
Total minimum lease payments to be received $ 314,000
Estimated residual values of leased property 13,378
Less: Unearned income -
---------
Net investment in leases $ 327,378
=========
At September 30, 1998, minimum lease payments for direct
financing and operating leases for each of the two 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 September 30, 1998 the
partnership had sold $1,893,615 in Investor Limited Partner
Units. As of September 30, 1998 the partnership acquired leased
equipment of $10,707,925 with an equity investment of $1,797,612
and nonrecourse bank borrowing of $8,910,313.
OPERATIONS
Total revenues decreased to $1,609,474 for the first three
quarters of the fiscal year ending December 31, 1998 ("fiscal
1998") from $1,673,354 for the first three quarters of the fiscal
year ended December 31, 1997 ("fiscal 1997"). Total revenues
consist of lease rental income and interest earned on short-term
money market investments. The decrease in total revenues was
primarily attributable to a decrease in the amount of equipment
on lease.
Operating expenses decreased to $1,927,297 for the first three
quarters of fiscal 1998 from $2,225,081 for the first three
quarters of fiscal 1997. Operating expenses consist of interest
on nonrecourse financing of equipment purchased, depreciation of
equipment, amortization of organization expenses, and
administrative expenses. The decrease in operating expenses
resulted primarily from an increase in depreciation expense and
interest on non-recourse debt resulting from the reduction of
debt.
The partnership does not plan to invest in additional equipment.
Future results depend on the collection of rents on existing and
extended leases, disposition of equipment from expired leases,
and interest earned 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
September 30, 1998 include offering proceeds available for
investment in equipment and undistributed cash earned during the
period from January 31, 1994 to September 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 nonrecourse 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 By: /s/ Gerald A. Horwitz
------------------
Gerald A. Horwitz, President
(Principal Executive Officer)
Date By: /s/ Jerry L. Schwartz
------------------
Jerry L. Schwartz,
Vice President,
Secretary and Treasurer
(Principal Financial and
Accounting Officer)
Date By: /s/ Gerald A. Horwitz
------------------
Gerald A. Horwitz
Its: General Partner
Page 13 of 13
<TABLE> <S> <C>
<ARTICLE> 5
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> Dec-31-1998
<PERIOD-START> Jan-01-1998
<PERIOD-END> Sep-30-1998
<CASH> 57,462
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 347,423
<PP&E> 6,876,776
<DEPRECIATION> 4,977,144
<TOTAL-ASSETS> 2,293,067
<CURRENT-LIABILITIES> 1,618,755
<BONDS> 0
0
0
<COMMON> 0
<OTHER-SE> 0
<TOTAL-LIABILITY-AND-EQUITY> 2,293,067
<SALES> 0
<TOTAL-REVENUES> 1,609,474
<CGS> 0
<TOTAL-COSTS> 0
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 165,723
<INCOME-PRETAX> (317,823)
<INCOME-TAX> 0
<INCOME-CONTINUING> (317,823)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 0
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
</TABLE>
