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 quarterly period ended June 30, 2005.
/___/ Transition report pursuant to Section 13 or 15(d) of the
Securities Act of 1934
for the transition period from ______________ to ________________.
Commission File Number 2-68926
DSI REALTY INCOME FUND VI, A California Limited Partnership
(Exact name of registrant as specified in its charter)
California_______________________________________95-3633566
(State or other jurisdiction of (I.R.S. Employer
incorporation) Identification No.)
6700 E. Pacific Coast Hwy, Long Beach, California 90803
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code-(562)493-8881
_________________________________________________________________
Former name, former address and former fiscal year, if changed
since last report.
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___.
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
DSI REALTY INCOME FUND VI
(A California Real Estate Limited Partnership)
BALANCE SHEETS(UNAUDITED), JUNE 30, 2005 AND DECEMBER 31, 2004
June 30, December 31,
2005 2004
ASSETS
CASH AND CASH EQUIVALENTS $ 462,934 $ 602,345
ASSET HELD FOR SALE (NOTE 5) 265,488
PROPERTY, Net 1,666,719 1,949,719
OTHER ASSETS 86,488 86,488
---------- ----------
TOTAL $2,481,629 $2,638,552
========== ==========
LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
LIABILITIES
Distribution to Partners 269,920 269,920
Capital lease obligation 139,621 162,616
Other liabilities 10,441 134,089
---------- ----------
Total liabilities $419,982 $566,625
========== ==========
PARTNERS' EQUITY (DEFICIT):
General Partners (72,668) (72,566)
Limited Partners 2,134,315 2,144,493
---------- ----------
Total partners' equity 2,061,647 2,071,927
TOTAL $2,481,629 $2,638,552
========== ==========
See accompanying notes to financial statements (unaudited).
STATEMENTS OF INCOME (UNAUDITED)
FOR THE THREE MONTHS ENDED JUNE 30, 2005 AND 2004
June 30, June 30,
2005 2004
REVENUES:
Rental $583,968 $569,923
-------- --------
EXPENSES:
Operating 295,780 258,089
General and administrative 71,624 75,109
-------- --------
Total expenses 367,404 333,198
-------- --------
OPERATING INCOME $216,564 $236,725
OTHER INCOME
Interest 211 209
-------- --------
INCOME FROM CONTINUING
OPERATIONS 216,775 236,934
DISCONTINUED OPERATIONS (Note 5)
INCOME FROM
DISCONTINUED OPERATIONS 54,781 34,915
-------- --------
NET INCOME $271,556 $271,849
======== ========
INCOME FROM CONTINUING
OPERATIONS ALLOCATED TO :
Limited Partners $214,607 $234,565
General Partners 2,168 2,369
-------- --------
TOTAL $216,775 $236,934
======== ========
INCOME PER
LIMITED PARTNERSHIP UNIT $ 9.03 $ 9.88
======= =======
AGGREGATE NET INCOME
ALLOCATED TO:
Limited Partners $268,840 $269,131
General Partners 2,716 2,718
-------- --------
TOTAL $271,556 $271,849
======== ========
NET INCOME PER LIMITED
PARTNERSHIP UNIT $ 11.32 $ 11.33
======== ========
LIMITED PARTNERSHIP
UNITS USED IN PER
UNIT CALCULATION 23,753 23,753
====== ======
See accompanying notes to financial statements(unaudited).
STATEMENTS OF INCOME (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 2005 AND 2004
June 30, June 30,
2005 2004
REVENUES:
Rental $1,164,880 $1,167,820
---------- ----------
EXPENSES:
Operating 589,446 493,085
General and administrative 144,507 145,079
---------- ----------
Total expenses 733,953 638,164
---------- ----------
OPERATING INCOME $430,927 $529,656
OTHER INCOME
Interest 418 417
---------- ----------
INCOME FROM CONTINUING
OPERATIONS 431,345 530,073
DISCONTINUED OPERAITONS (Note 5)
INCOME FROM
DISCONTINUED OPERATIONS 98,215 75,065
---------- ----------
NET INCOME $529,560 $605,138
========== ==========
INCOME FROM CONTINUING
OPERATIONS ALLOCATED TO:
Limited Partners $427,032 $524,772
General Partners 4,313 5,301
---------- ----------
TOTAL $431,345 $530,073
========== ==========
INCOME FROM CONTINUING
OPERATIONS PER
LIMITED PARTNERSHIP UNIT $17.98 $22.09
====== ======
AGGREGATE NET INCOME
ALLOCATED TO:
Limited Partners $524,264 $599,087
General Partners 5,296 6,051
---------- ----------
TOTAL $529,560 $605,138
========== ==========
NET INCOME PER LIMITED
PARTNERSHIP UNIT $22.07 $25.22
====== ======
LIMITED PARTNERSHIP UNITS
USED IN PER UNIT CALCULATION 23,753 23,753
====== ======
See accompanying notes to financial statements (unaudited).
STATEMENT OF CHANGES IN PARTNERS' EQUITY (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 2005
GENERAL LIMITED
PARTNERS PARTNERS TOTAL
BALANCE AT JANUARY 1, 2005 ($72,566) $2,144,493 $2,071,927
NET INCOME 5,296 524,264 529,560
DISTRIBUTIONS (5,398) (534,442) (539,840)
-------- ---------- ----------
BALANCE AT JUNE 30, 2005 ($72,668) $2,134,315 $2,061,647
======== ========== ==========
See accompanying notes to financial statements(unaudited).
STATEMENT OF CASH FLOWS (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 2005 AND 2004
June 30, June 30,
2005 2004
CASH FLOWS FROM OPERATING
ACTIVITIES:
Net income $ 529,560 $ 605,138
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation 17,512
Changes in assets and liabilities:
Decrease in liabilities (146,643) (32,819)
Net cash provided by operating --------- ---------
activities 400,429 572,319
--------- ---------
CASH FLOWS FROM FINANCING ACTIVITIES -
Distributions to partners (539,840) (539,840)
NET (DECREASE)INCREASE IN CASH AND
CASH EQUIVALENTS (139,411) 32,479
CASH AND CASH EQUIVALENTS:
At beginning of period 602,345 656,745
--------- ---------
At end of period $ 462,934 $ 689,224
========= =========
See accompanying notes to financial statements (unaudited).
DSI REALTY INCOME FUND VI
(A California Real Estate Limited Partnership)
NOTES TO FINANCIAL STATEMENTS (UNAUDITED)
1. GENERAL
DSI Realty Income Fund VI (the "Partnership"), a limited partnership, has two
general partners (DSI Properties, Inc., and Diversified Investors Agency)
and limited partners owning 23,753 limited partnership units. The Partnership
was formed under the California Uniform Limited Partnership Act for the
primary purpose of acquiring and operating real estate.
The Partnership owns seven mini-storage facilities located in Vallejo,
California; Arvada, Federal Heights and Colorado Springs, Colorado; Las
Vegas, Nevada and two in Santa Rosa, California. All facilities were
purchased from Dahn Corporation ("Dahn"). Dahn is not affiliated with the
Partnership. Dahn is affiliated with other partnerships in which DSI
Properties, Inc. is a general partner. The mini-storage facilities are
operated for the Partnership by Dahn under various agreements that are
subject to renewal annually. Under the terms of the agreements, the
Partnership is required to pay Dahn a property management fee equal to 6%
of gross revenue from operations, defined as the entire amount of
all receipts from the renting or leasing of storage compartments and
sale of locks.
The accompanying financial information as of June 30, 2005, and for
the periods ended June 30, 2005 and 2004, is unaudited. Such financial
information includes all adjustments which are considered necessary by the
Partnership's management for a fair presentation of the results for the
periods indicated.
2. PROPERTY
Properties owned by the Partnership are all mini-storage facilities.
Depreciation is calculated using the straight line method over the estimated
useful life of 20 years. The total cost of property and accumulated
depreciation is as follows:
June 30, 2005 December 31, 2004
Land $ 1,512,000 $ 1,759,000
Buildings and improvements 7,445,231 8,579,426
Equipment 199,103 227,029
----------- -----------
Total 9,156,334 10,565,455
Less: Accumulated Depreciation ( 7,489,615) (8,615,736)
----------- -----------
Property - Net $ 1,666,719 $ 1,949,719
=========== ===========
3. NET INCOME PER LIMITED PARTNERSHIP UNIT
Net income per limited partnership unit is calculated by dividing the
net income allocated to the limited partners by the number of limited
partnership units outstanding during the period.
4. ALLOCATION OF PROFITS AND LOSSES AND GENERAL PARTNERS' INCENTIVE
MANAGEMENT FEE
Under the Agreement of limited Partnership, the general partners are to
be allocated 1% of the net profits or losses from operations, and the
limited partners are to be allocated the balance of the net profits or
losses from operations in proportion to their limited partnership
interests.
The General Partners are also entitled to receive a percentage, based on
a predetermined formula, of any cash distribution from the sale, other
disposition or refinancing of the project.
In addition, the General Partners are entitled to receive an incentive
management fee for supervising the operations of the Partnership. The
fee is to be paid in an amount equal to 9% per annum of the cash available
for distribution on a cumulative basis, calculated as cash generated from
operations less capital expenditures.
5. DISCONTINUED OPERATIONS
On June 10, 2005, a purchase agreement was signed with Station Casinos,
whereby it would acquire the Partnerships' mini-storage facility in Las
Vegas, Nevada. Escrow closed on August 1,2005 and the sale proceeds were
transferred to the Partnership on August 2, 2005. On August 8, 2005, the
proceeds in the amount of $4,545,612 were distributed to the Limited
Partners. The gain on sale of the facility is approximately $3,154,000.
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations.
We are pleased to enclose the Partnership's unaudited financial statements
for the period ended June 30, 2005. The following is Management's discussion
and analysis of the Partnership's financial condition and results of its
operations.
For the three-month periods ended June 30, 2005, and 2004, total revenues
increased 6.5% from $632,876 to $674,227 and total expenses increased 11.5%
from $361,236 to $402,882 and other income increased from $209 to $211. As
a result, net income decreased 0.1% from $271,849 for the three-month period
ended June 30, 2004, to $271,556 for the same period in 2005. The revenue
increase can be attributed to an increase in rental income as a result of
higher unit rental rates. Occupancy levels for the Partnership's six mini-
storage facilities averaged 79.7% for the three-month period ended June 30,
2005, compared to 79.5% for the same period in 2004. The Partnership is
continuing its marketing efforts to attract and keep new tenants in its
various mini-storage facilities. Operating expenses increased approximately
$45,100 (15.8%) primarily due to increases in purchase of locks, property
management fees, salaries and wages, truck insurance and depreciation expenses,
partially offset by a decrease in advertising expense. General and admini-
strative expenses decreased approximately $3,500 (4.7%) primarily as a result
of a decrease in state tax payments.
For the six-month periods ended June 30, 2005, and 2004, total revenues
increased 2.6% from $1,303,545 to $1,337,018, total expenses increased 15.6%
from $698,824 to $807,876 and other income increased from $417 to $418. As
a result, net income decreased 12.5% from $605,138 for the six months ended
June 30, 2004, to $529,560 for the same period in 2005. The revenue increase
can be attributed to an increase in rental revenue as a result of higher unit
rental rates. Operating expenses increased approximately $109,600 (19.8%)
primarily due to increases in depreciation, maintenance and repair, purchase
of locks, salaries and wages and truck insurance, parially offset by a decrease
in security alarm services expense. General and administrative expenses re-
mained constant, as increases in legal and professional and equipment and
computer lease expenses was offset by decreases in incentive management fee
expense and state tax.
On June 10, 2005, a purchase agreement was signed with Station Casinos, whereby
they would acquire the Partnerships' mini-storage facility in Las Vegas,
Nevada. Escrow closed on August 1,2005 and the sale proceeds were transferred
to the Partnership on August 2, 2005. On August 8, 2005, the proceeds in the
amount of $4,545,612 were distributed to the Limited Partners. The gain on
sale of the facility is approximately $3,154,000.
The General Partners plan to continue their policy of funding improvements
and maintenance of Partnership properties with cash generated from
operations. The Partnership's resources appear to be adequate to meet
its needs. The General Partners anticipate distributions to the Limited
Partners to remain at the current level for the foreseeable future.
Item 3. Quantative and Qualitative Disclosures About Market Risk
NONE
Item 4. CONTROLS AND PROCEDURES
Within 90 days prior to the date of this report, the Partnership evaluated
the effectiveness of its disclosure controls and procedures. This evaluation
was performed by the Partnership's Controller with the assistance of the
Partnership's President and the Chief Executive Officer. These disclosure
controls and procedures are designed to ensure that the information required
to be disclosed by the Partnership in its periodic reports filed with the
Securities and Exchange Commission (the Commission) is recorded, processed,
summarized and reported, within the time periods specified by the Commission's
rules and forms, and that the information iscommunicated to the certifying
officers on a timely basis. Based on this evaluation, the Partnership con-
cluded that its disclosure controls and procedures were effective. There
have been no significant changes in the Partnership's internal controls or
in other factors that could significantly affect the internal controls sub-
sequent to the date of their evaluation.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
Registrant is not a party to any material pending legal proceedings.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
NONE
Item 3. Defaults Upon Senior Securities
NONE
Item 4. Submission of Matters to a Vote of Security Holders
NONE
Item 5. Other Information
NONE
Item 6. Exhibits and Reports on Form 8K.
(a) Attached hereto as Exhibit "20" is Registrant's Quarterly
Report to Limited Partners for the period ended
June 30, 2005.
(b) Registrant did not file any reports on Form 8-K for the
period reported upon.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
Dated: August 10, 2005 DSI REALTY INCOME FUND VI
A California Limited Partnership
(Registrant)
By__/s/ Robert J. Conway______
DSI Properties, Inc., as General
Partner by ROBERT J. CONWAY,
President and Chief Financial
Officer
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
Dated: July 29, 2005 DSI REALTY INCOME FUND VI
A California Limited Partnership
(Registrant)
By___/s/ Robert J. Conway_____
DSI Properties, Inc., as General
Partner by ROBERT J. CONWAY,
President and Chief Financial
Officer
CERTIFICATIONS
I, Robert J. Conway, certify that:
1. I have reviewed this quarterly report on Form 10-Q of DSI Realty Income
Fund VI;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period cover-
ed by this quarterly report.
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-15e and 15d-15e) for the registrant and have:
a) designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our super-
vision, to ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which this
quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures as of the end
of the period covered by this report based on such evaluation; and
c) disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the registrant's
most recent fiscal quarter (the registrant's fourth fiscal quarter in
the case of our annual report) that has materially affected, or is
control over financial reporting; and
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation of internal control over financial reporting,
to the registrant's auditors:
a) all significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are
reasonably likely to affect the registrant's ability to record, pro-
cess, summarize and report financial information; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's in-
ternal controls over financial reporting.
Date: July 29, 2005
Robert J. Conway
Chief Executive Officer
CERTIFICATIONS
I, Richard P. Conway, certify that:
1. I have reviewed this quarterly report on Form 10-Q of DSI Realty Income
Fund VI;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period cover-
ed by this quarterly report.
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-15e and 15d-15e) for the registrant and have:
a) designed such disclosure controls and procedures, or caused such
disclosure controls and procedures to be designed under our super-
vision, to ensure that material information relating to the registrant,
including its consolidated subsidiaries, is made known to us by others
within those entities, particularly during the period in which this
quarterly report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures and presented in this report our conclusions about the
effectiveness of the disclosure controls and procedures as of the end
of the period covered by this report based on such evaluation; and
c) disclosed in this report any change in the registrant's internal
control over financial reporting that occurred during the registrant's
most recent fiscal quarter (the registrant's fourth fiscal quarter in
the case of our annual report) that has materially affected, or is
control over financial reporting; and
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation of internal control over financial reporting,
to the registrant's auditors:
a) all significant deficiencies and material weaknesses in the design
or operation of internal control over financial reporting which are
reasonably likely to affect the registrant's ability to record, pro-
cess, summarize and report financial information; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's in-
ternal controls over financial reporting.
Date: July 29, 2005
Richard P. Conway
Vice President
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of DSI Realty Income Fund VI (the
"Partnership") on Form 10-Q for the period ending June 30, 2005 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
I, Robert J. Conway, Chief Executive Officer of the Partnership, certify,
pursuant to 18 U.S.C. 1350, as adopted pursuant to 906 of the Sarbanes-Oxley
Act of 2002, that:
(1) The Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Partnership.
Robert J. Conway
Chief Executive Officer
July 29, 2005
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of DSI Realty Income Fund VI (the
"Partnership") on Form 10-Q for the period ending June 30, 2005 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
I, Richard P. Conway, Vice President of the Corporate General Partner, certify,
pursuant to 18 U.S.C. 1350, as adopted pursuant to 906 of the Sarbanes-Oxley
Act of 2002, that:
(1) The Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Partnership.
Richard P. Conway
Vice President
July 29, 2005