UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
X Quarterly Report Under Section 13 or 15(d) of
the Securities Exchange Act of 1934
For the Quarter Ended March 31, 1997
OR
___ 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 0-15763
ML DELPHI PREMIER PARTNERS, L.P.
(Exact name of registrant as specified in its charter)
Delaware 13-3350265
(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification No.)
666 Third Avenue, New York, New York 10017
(Address of principal executive offices) (Zip Code)
(212) 983-9040
(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.
Yes X No____
ML DELPHI PREMIER PARTNERS, L.P.
(A Delaware Limited Partnership)
BALANCE SHEETS
(000's Omitted)
Unaudited
March December
31, 31,
1997 1996
ASSETS
Cash $ $
255 187
Short-Term Investments 1,075 39,262
Receivable from Tri-Star-ML
Delphi Premier
Productions, net 400 2,179
Receivable from Columbia
Pictures
(Distributor) 118 103
Interests in Motion Pictures
Released, net of
accumulated amortization of
$11,529 and
$11,527, respectively 0 2
Motion Picture Costs
Recoverable from
Special Recoupment
Payments 0 1,516
Total Assets $ $
1,848 43,249
LIABILITIES AND PARTNERS'
CAPITAL
Liabilities:
Accrued Expenses and Accounts $ $
Payable 18 30
Distribution Payable
0 38,163
Total Liabilities
18 38,193
Partners' Capital (Note 2):
General Partner (140) 123
Limited Partners
1,970 4,933
Total Partners'
Capital 1,830 5,056
Total Liabilities $ $
and Partners' Capital 1,848 43,249
See accompanying notes to the financial statements.
ML DELPHI PREMIER PARTNERS, L.P.
(A Delaware Limited Partnership)
STATEMENTS OF OPERATIONS
(000's Omitted, except net profit per unit)
Unaudited
For the Three Months Ended March 31,
1997 1996
Net Revenue from Motion
Pictures
Released $ $
15 3
Special Recoupment Payment
Accrual 0 53
Interest Income
115 9
130 65
Expenses:
Management Fee 0 142
Amortization of
Interests in
Motion Pictures 2 0
Released
Operating Expenses
78 9
80 151
Profit (Loss)before Share
of Profit
in Motion Picture 50 (86)
Venture
Share of Profit in Motion
Picture Venture--Tri-
Star-
ML-Delphi Premier
Productions 50 464
Net Profit $ $
100 378
Net Profit Per Unit of
Limited
Partnership Interest
(12,610 units) $ $
0 30
See accompanying notes to the financial statements.
ML DELPHI PREMIER PARTNERS, L.P.
(A Delaware Limited Partnership)
STATEMENTS OF CASH FLOWS
(000's Omitted)
Unaudited
For the Three Months Ended March 31,
1997 1996
Cash Flow From Operating Activities:
Net Profit $ $
100 378
Adjustments to reconcile Net Profit
to net cash
provided (used) by operating
activities:
Share of Profit in Motion Picture (50) (464)
Venture
Distributions from Joint Venture 50 484
Changes in Assets and
Liabilities:
Increase in Prepaid Expense 0 (427)
Decrease (Increase) in Motion
Picture Costs
Recoverable from Special
Recoupment
Payments 1,516 (53)
(Increase) Decrease in
Receivable from
Columbia Pictures (15) 1
(Distributor)
Decrease (Increase) in
Receivable from
Tri-Star-ML Delphi 1,779 (425)
Premier Productions, net
Decrease in Accrued Expenses
and
Accounts Payable
(12) (22)
Net Cash Provided (Used) by
Operating Activities 3,368 (528)
Cash Flow From Investing Activities:
Purchases of Short-Term Investments
(7,551) (108)
Redemptions of Short-Term Investments
45,738 0
Net Cash Provided (Used) by
Investing Activities 38,187 (108)
Cash Flow from Financing Activities:
Distributions to Partners
(41,487) 0
Net Cash Used by Financing
Activities (41,487) 0
Increase (Decrease) In Cash 68 (636)
Cash at beginning of period
187 714
Cash at end of period $ $
255 78
See accompanying notes to the financial statements.
ML DELPHI PREMIER PARTNERS, L.P.
(A Delaware Limited Partnership)
NOTES TO FINANCIAL STATEMENTS
Unaudited
1. Basis of Presentation
The accompanying unaudited financial statements have
been prepared in accordance with generally accepted
accounting principles for interim financial information.
They do not include all information and notes required by
generally accepted accounting principles for complete
financial statements. There has been no material change in
the information disclosed in the notes to financial
statements of the Partnership included in the Annual Report
on Form 10-K for the year ended December 31, 1996. The
information furnished includes all adjustments which are, in
the opinion of management, necessary to present fairly the
financial position of the Partnership as of March 31, 1997
and the results of operations and cash flows for the periods
ended March 31, 1997 and 1996. Results of operations for
the three month period ended March 31, 1997 are not
necessarily indicative of the results that may be expected
for the entire fiscal year.
2. Current Operations
As of March 31, 1997, the Partnership had an interest
in twenty SF Interest films, three of which are owned
directly and distributed through Columbia Pictures
("Columbia") and seventeen of which are owned through a
Joint Venture with TriStar Pictures, Inc. ("TriStar"). In
addition, as of March 31, 1997, the Partnership has an
interest in three Extra Films through the Tri-Star Joint
Venture. All films in which the Partnership has an
interest, as of March 31, 1997, have completed their
theatrical release and are being distributed in various
ancillary markets.
Based on the anticipated performance of one SF Interest
film released through the Tri-Star Joint Venture, it is
expected that the Distributor of the Tri-Star Joint Venture
will be required to make a Special Recoupment Payment with
respect to that film. Accordingly, distribution fees earned
and expected to be earned by the Distributor as of March 31,
1997 of approximately $448,000 have been accrued by the
Partnership as a receivable from the Tri-Star Joint Venture.
For the purpose of computing the net profit per unit,
the net profit for the period is computed in accordance with
the Partnership Agreement.
3. Additional Information
Additional information, including the audited year end
1996 Financial Statements and the Summary of Significant
Accounting Policies, is included in the Partnership's Annual
Report on Form 10-K for the year ended December 31, 1996 on
file with the Securities and Exchange Commission.
Management's Discussion and Analysis of Financial Condition
and Results of Operations
a. Financial Condition
The Partnership has fully satisfied its commitment to
contribute funds to the Tri-Star Joint Venture and to
Columbia for the production of, and acquisition of SF
Interests in, films. As of March 31, 1997, the Partnership
held cash of approximately $255,000 and short-term
investments of approximately $1,075,000.
The Partnership commenced cash distributions to its
partners in December 1987. Distributions through March 31,
1997 to the limited partners have aggregated $6,100 per
unit. Accordingly, the limited partners have received cash
distributions in excess of their original investment in the
Partnership.
The Partnership has begun evaluating the value of its
interest in the film assets for the purpose of possibly
selling that interest and liquidating the Partnership. The
General Partner anticipates that the Partnership may be
liquidated in 1998. No assurance can be provided that the
film assets will be sucessfully sold, or if sold, when such
sale would occur. Upon the ultimate sale of the film assets,
the Partnership will commence taking steps to dissolve and
liquidate. Cash distributions as a result of the liquidation
may be made to the partners to the extent, and only to the
extent, the proceeds from a sale of the Partnerships'
interest in the film assets in connection with the
liquidation are in excess of the Distributors' entitlement to
the recoupment of Special Recoupment Payments and a reserve
for the Partnership's remaining obligations and operating
expenses.
Since the Partnership's obligations to make
contributions to the Tri-Star Joint Venture for the
production of, and acquisition of interests in, films have
been satisfied, all revenue received by the Partnership (for
other than Unrecouped Films) is used to pay operating
expenses of the Partnership and to make cash distributions
to partners. The Partnership does not anticipate
significant future revenues and accordingly, the Partnership
does not currently anticipate making cash distributions to
partners on a quarterly basis. However, the Partnership may
make future distributions if it realizes proceeds from its
interest in films or from the sale of its interest in films
(should the sale occur) net of a reserve for the
Partnership's operating expenses.
b. Results of Operations
The Partnership's operating results are primarily
dependent upon the operating results of the Tri-Star Joint
Venture's films and films owned directly by the Partnership
and are significantly impacted by the Tri-Star Joint
Venture's and Columbia's policies.
The performance of each film, where net proceeds
determines the amount of revenue recognized, is based upon
the amount expended for production and other costs
associated with a film and the gross receipts generated by a
film. The amount and timing of gross receipts generated by
each film is dependent upon the degree of acceptance by the
consumer public and the particular ancillary market in which
the film is then being exhibited.
Amounts contributed toward each film are compared
periodically to the expected total revenue to be generated
for that film, and write-downs may occur to the extent the
amounts invested exceed the expected total revenue for that
film.
Additionally, the Tri-Star Joint Venture and the
Partnership may record income with respect to Special
Recoupment Payments, to the extent available, which may
allow them to recover their respective investment in SF
Interest films.
For the three month period ended March 31, 1997, the
Tri-Star Joint Venture had a net profit of which the
Partnership's share was approximately $50,000, and the
Partnership had an overall net profit of approximately
$100,000. The Partnership's share of the Tri-Star Joint
Venture's net profit was primarily due to revenue accrued
with respect to certain films offset, in part, by the
recapture of Special Recoupment Payments. The variance
between the Partnership's share of the Tri-Star Joint
Venture's net profit and the Partnership's net profit was
primarily due to the amount by which the Partnership's
interest income earned on Partnership funds and revenue
recognized with respect to films owned directly exceeded the
Partnership's expenses (including amortization of the
Partnership's direct interest in motion pictures).
For the three month period ended March 31, 1996, the
Tri-Star Joint Venture had a net profit of which the
Partnership's share was approximately $464,000, and the
Partnership had an overall net profit of approximately
$378,000. The Partnership's share of the Joint Venture's
net profit was primarily due to interest income related to
the accrual of Special Recoupment Payments and to revenue
accrued with respect to certain films offset, in part, by
interest expense related to Acceleration Payments. The
variance between the Partnership's share of the Tri-Star
Joint Venture's net profit and the Partnership's net profit
was primarily due to the amount by which the Partnership's
expenses exceeded the recognition of the Special Recoupment
Payment for films owned directly, interest income earned on
Partnership funds and revenue recognized with respect to
films owned directly.
The Partnership reports net revenue from motion picture
exploitation for the three films in which it owns interests
directly. The increase in net revenue for the three month
period ended March 31, 1997 as compared with the
corresponding period in 1996 is due primarily to an increase
in the accrual of syndicated television revenues in 1997.
The increase in interest income for the three month
period ended March 31, 1997 as compared with the
corresponding period in 1996 was due primarily to more funds
being available for short-term investments as well as higher
interest rates earned on short-term investments during 1997.
The decrease in total expenses for the three month
period ended March 31, 1997 (inclusive of amortization of
the Partnership's direct interest in motion pictures) as
compared with the corresponding period in 1996 was primarily
attributable to the Management Fee incurred in 1996 but not
in 1997 due to the expiration of the Management Fee
arrangement at the end of 1996 offset, in part, by an
increase in Operating Expenses. The increase in Operating
Expenses is due primarily to the increase in the
reimbursement to the General Partner in 1997 for out-of-
pocket expenses incurred in connection with its management
of the Partnership's business.
TRI-STAR- ML DELPHI PREMIER PRODUCTIONS
(A Joint Venture)
BALANCE SHEETS
(000's Omitted)
Unaudited
March December
31, 31,
1997 1996
ASSETS
Motion Picture Production and
Advertising
Costs, net of accumulated
amortization of
$280,584 and $280,547, $ 333 $
respectively 370
Motion Picture Costs Recoverable
from
Special Recoupment Payments 7,149 31,640
Receivable from TriStar
Pictures, Inc.
(Distributor), net
1,931 1,962
Total $ 9,413 $ 33,972
Assets
LIABILITIES AND VENTURERS'
CAPITAL
Liabilities:
Payable to TriStar Pictures, $ 8,680 $ 31,423
Inc.
Payable to ML Delphi Premier
Partners, L.P., net 2,179
400
Total 9,080 33,602
Liabilities
Venturers' Capital:
TriStar Pictures, Inc. 333 370
ML Delphi Premier Partners,
L.P. 0 0
Total
Venturers' Capital 333 370
Total
Liabilities and Venturers'
$ $ 33,972
Capital 9,413
See accompanying notes to the financial statements.
TRI-STAR-ML DELPHI PREMIER PRODUCTIONS
(A Joint Venture)
STATEMENTS OF OPERATIONS
(000's Omitted)
Unaudited
For the Three
Months Ended March 31,
1997 1996
Net Revenues From Motion
Picture
Exploitation $ $
378 524
Less: Amortization of
Motion
Picture
Production and
Advertising
Costs 37 90
Income from Operations 341 434
Special Recoupment
Payment
Recapture (63) 0
Interest Income, net
0 1,803
Net Income $ $
278 2,237
See accompanying notes to the financial statements.
TRI-STAR - ML DELPHI PREMIER PRODUCTIONS
(A Joint Venture)
STATEMENTS OF CASH FLOWS
(000's Omitted)
Unaudited
For the Three Months Ended March 31,
1997 1996
Cash Flow From Operating
Activities:
Net Income $ $
278 2,237
Adjustments to reconcile Net
Income to net cash
provided by operating
activities:
Amortization of Motion Picture
Production
and Advertising Costs 37 90
Accrued Distributions to 24,522 (2,073)
Venturers
Changes in Assets and
Liabilities:
(Decrease) Increase in
Payable to ML Delphi
Premier Partners, L.P., (1,779) 425
net
(Decrease) Increase in
Payable to TriStar
Pictures Inc., net (22,743) 1,647
Decrease (Increase) in
Receivable from
Tri-Star Pictures, Inc. 31 (10)
(Distributor), net
Decrease (Increase) in
Motion Picture Costs
Recoverable from
Special Recoupment
Payments
24,491 (2,062)
Net Cash Provided by
Operating Activities 24,837 254
Cash Flow From Financing
Activities:
Distributions to Venturers
(24,837) (254)
Net Cash Used by
Financing Activities (24,837) (254)
Net Change in Cash 0 0
Cash at beginning of period
0 0
Cash at end of period $ $
0 0
See accompanying notes to the financial statements.
TRI-STAR - ML DELPHI PREMIER PRODUCTIONS
(A Joint Venture)
NOTES TO FINANCIAL STATEMENTS
Unaudited
1. Basis of Presentation
The accompanying unaudited financial statements have
been prepared in accordance with generally accepted
accounting principles for interim financial information.
They do not include all information and notes required by
generally accepted accounting principles for complete
financial statements. There has been no material change in
the information disclosed in the notes to financial
statements of Tri-Star-ML Delphi Premier Productions (the
"Joint Venture") included in the Annual Report on Form 10-K
of ML Delphi Premier Partners, L.P. (the "Partnership") for
the year ended December 31, 1996. The information furnished
includes all adjustments which are, in the opinion of
management, necessary to present fairly the financial
position of the Joint Venture as of March 31, 1997 and the
results of its operations and cash flows for the periods
ended March 31, 1997 and 1996. Results of operations for
the period ended March 31, 1997 are not necessarily
indicative of the results that may be expected for the
entire fiscal year.
2. Current Operations
All seventeen SF Interest films in which the Joint
Venture has an interest have completed their theatrical
release and are being distributed in various ancillary
markets. In addition, the Joint Venture has an interest in
three Extra Films which have completed their theatrical
release and are being distributed in various ancillary
markets. For the three month period ended March 31, 1997,
the Joint Venture is reporting net revenue of $378,000, due
primarily to the performance of various SF Interest films in
the worldwide free television market. For the three month
period ended March 31, 1997, the Joint Venture recorded a
decrease of $63,000 in the Special Recoupment Payment
accrual due to a decrease in the estimated distribution fee
to be earned by its Distributor.
For the three month period ended March 31, 1996, the
Joint Venture reported net revenue of $524,000, due
primarily to the performance of various PF Interest films in
the worldwide free television market and to the performance
of various SF Interest films in the worldwide free
television market and one SF Interest film in the pay
television market. In addition, for the three month period
ended March 31, 1996, the Joint Venture recorded net
interest income of $1,803,000, due primarily to the decrease
in the discount period relating to the Special Recoupment
Payment net of interest expense related to the Acceleration
Payments.
3. Additional Information
Additional information, including the audited year end
1996 Financial Statements and the Summary of Significant
Accounting Policies, is included in the Annual Report on
Form 10-K of the Partnership for the year ended December 31,
1996.
PART II
Item 1. Legal Proceedings
None
Item 2. Changes in Securities
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 8-K
A). Exhibits
EXHIBIT
NUMBERDESCRIPTIONPAGE NUMBER
27 Financial Data Schedule
B). Reports on Form 8-K
None
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.
ML DELPHI PREMIER PARTNERS,
L.P.
A Delaware Limited Partnership
By: ML DELPHI PARTNERS, L.P.,
General Partner
By: ML Film Entertainment
Inc.,
general partner
May 13, 1997
/s/ Roger F. Castoral, Jr.
Date
Roger F. Castoral, Jr.
Vice President and Treasurer of the
Managing Partner of the General Partner
(principal financial officer and principal
accounting officer of the Registrant)
May 13, 1997 /s/ Steven N.
Baumgarten
Date Steven N. Baumgarten
Director and Vice President of
the general partner
of the General Partner