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, 1998
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,
1998 1997
ASSETS
Cash $ $
290 304
Short-Term Investments 845 891
Receivable from Tri-Star-ML
Delphi Premier
Productions, net 351 339
Receivable from Columbia
Pictures
(Distributor)
171 168
Total Assets $ $
1,657 1,702
LIABILITIES AND PARTNERS'
CAPITAL
Liabilities:
Accrued Expenses and Accounts $ $
Payable 27 47
Total Liabilities
27 47
Partners' Capital (Note 2):
General Partner (241) (241)
Limited Partners
1,871 1,896
Total Partners'
Capital 1,630 1,655
Total Liabilities $ $
and Partners' Capital 1,657 1,702
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 (loss) profit per unit)
Unaudited
For the Three Months Ended March 31,
1998 1997
Net Revenue from Motion
Pictures
Released $ $
3 15
Interest Income
11 115
14 130
Expenses:
Amortization of
Interests in
Motion Pictures 0 2
Released
Operating Expenses
63 78
63 80
(Loss) Profit before Share
of Profit
in Motion Picture (49) 50
Venture
Share of Profit in Motion
Picture Venture--Tri-
Star-
ML-Delphi Premier
Productions 24 50
Net (Loss) Profit $ $
(25) 100
Net (Loss) Profit Per Unit
of Limited
Partnership Interest
(12,610 units) $ $
(2) 0
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,
1998 1997
Cash Flow From Operating Activities:
Net (Loss) Profit $ $
(25) 100
Adjustments to reconcile Net (Loss)
Profit to net cash
(used) provided by operating
activities:
Share of Profit in Motion Picture (24) (50)
Venture
Distributions from Joint Venture 24 50
Changes in Assets and
Liabilities:
Decrease in Motion Picture
Costs Recoverable
from Special Recoupment 0 1,516
Payments
Increase in Receivable from
Columbia
Pictures (Distributor) (3) (15)
(Increase) Decrease in
Receivable from
Tri-Star-ML Delphi (12) 1,779
Premier Productions, net
Decrease in Accrued Expenses
and
Accounts Payable
(20) (12)
Net Cash (Used) Provided by
Operating Activities (60) 3,368
Cash Flow From Investing Activities:
Purchases of Short-Term Investments
(843) (7,551)
Redemptions of Short-Term Investments
889 45,738
Net Cash Provided by Investing
Activities 46 38,187
Cash Flow from Financing Activities:
Distributions to Partners
0 (41,487)
Net Cash Used by Financing
Activities 0 (41,487)
(Decrease) Increase In Cash (14) 68
Cash at beginning of period
304 187
Cash at end of period $ $
290 255
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, 1997. 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, 1998
and the results of operations and cash flows for the periods
ended March 31, 1998 and 1997. Results of operations for
the three month period ended March 31, 1998 are not
necessarily indicative of the results that may be expected
for the entire fiscal year.
2. Current Operations
As of March 31, 1998, 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, 1998, 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, 1998, 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,
1998 of approximately $388,000, partially offset by a net
non-refundable advance of $37,000, have been accrued by the
Partnership as a receivable from the Tri-Star Joint Venture.
For the purpose of computing the net loss per unit, the
allocation of the net loss for the period is computed in
accordance with the Partnership Agreement.
3. Additional Information
Additional information, including the audited year end
1997 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, 1997 on
file with the Securities and Exchange Commission.
4. Use of Estimates
Management of the Partnership has made a number of
estimates and
assumptions relating to the reporting of assets and
liabilities and the disclosure of
contingent liabilities to prepare these financial statements
in conformity with generally
accepted accounting principles. Actual results could differ
from those estimates.
<PAGE
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, 1998, the Partnership
held cash of approximately $290,000 and short-term
investments of approximately $845,000.
The Partnership commenced cash distributions to its
partners in December 1987. Distributions through March 31,
1998 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 its film assets for the purpose of possibly
selling that interest and liquidating the Partnership. The
General Partner anticipates that the Partnership will be
liquidated in 1998. No assurance can be provided that the
Partnership's film assets will be successfully sold, or if
sold, when such sale would occur. Upon the ultimate sale of
the Partnership's 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, 1998, the
Tri-Star Joint Venture had a net profit of which the
Partnership's share was approximately $24,000, and the
Partnership had an overall net loss of approximately
$25,000. The Partnership's share of the TriStar Joint
Venture's net profit was primarily due to revenue accrued
with respect to certain films. The variance between the
Partnership's share of the Tri-Star Joint Venture's net
profit and the Partnership's net loss was primarily due to
the amount by which the Partnership's expenses exceeded
interest income earned on Partnership funds and revenue
recognized with respect to films owned directly.
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).
The Partnership reports net revenue from motion picture
exploitation for the three films in which it owns interests
directly. The decrease in net revenue for the three month
period ended March 31, 1998 as compared with the
corresponding period in 1997 is due primarily to a decrease
in the accrual of syndicated television revenues in 1998.
The decrease in interest income for the three month
period ended March 31, 1998 as compared with the
corresponding period in 1997 was due primarily to less funds
being available for short-term investments.
The decrease in total expenses for the three month
period ended March 31, 1998 compared with the corresponding
period in 1997 was primarily attributable to the decrease in
Operating Expenses. The decrease in Operating Expenses is
due primarily to the decrease in the reimbursement to the
General Partner in 1998 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,
1998 1997
ASSETS
Motion Picture Production and
Advertising
Costs, net of accumulated
amortization of
$280,685 and $280,678, $ 232 $
respectively 239
Motion Picture Costs Recoverable
from
Special Recoupment Payments 6,802 6,902
Receivable from TriStar
Pictures, Inc.
(Distributor), net
2,593 2,284
Total $ 9,627 $ 9,425
Assets
LIABILITIES AND VENTURERS'
CAPITAL
Liabilities:
Payable to TriStar Pictures, $ 9,044 $ 8,847
Inc.
Payable to ML Delphi Premier
Partners, L.P., net
351 339
Total 9,395 9,186
Liabilities
Venturers' Capital:
TriStar Pictures, Inc. 232 239
ML Delphi Premier Partners,
L.P. 0 0
Total
Venturers' Capital 232 239
Total
Liabilities and Venturers'
$ $ 9,425
Capital 9,627
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,
1998 1997
Net Revenues From Motion
Picture
Exploitation $ $
655 378
Less: Amortization of
Motion
Picture
Production and
Advertising
Costs 7 37
Income from Operations 648 341
Special Recoupment
Payment
Recapture
0 (63)
Net Income $ $
648 278
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,
1998 1997
Cash Flow From Operating
Activities:
Net Income $ $
648 278
Adjustments to reconcile Net
Income to net cash
provided by operating
activities:
Amortization of Motion Picture
Production
and Advertising Costs 7 37
Accrued Distributions to (285) 24,522
Venturers
Changes in Assets and
Liabilities:
Increase (Decrease) in
Payable to ML Delphi
Premier Partners, L.P., 12 (1,779)
net
Increase (Decrease) in
Payable to TriStar
Pictures Inc., net 197 (22,743)
(Increase) Decrease in
Receivable from
Tri-Star Pictures, Inc. (309) 31
(Distributor), net
Decrease in Motion Picture
Costs
Recoverable from
Special Recoupment
Payments
100 24,491
Net Cash Provided by
Operating Activities 370 24,837
Cash Flow From Financing
Activities:
Distributions to Venturers
(370) (24,837)
Net Cash Used by
Financing Activities (370) (24,837)
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, 1997. 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, 1998 and the
results of its operations and cash flows for the periods
ended March 31, 1998 and 1997. Results of operations for
the period ended March 31, 1998 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, 1998,
the Joint Venture is reporting net revenue of $655,000 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 reported 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.
3. Additional Information
Additional information, including the audited year end
1997 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,
1997.
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 14, 1998
/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 14, 1998 /s/ Steven N.
Baumgarten
Date Steven N. Baumgarten
Director and Vice President of
the general partner
of the General Partner