SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT
OF 1934
For the quarterly period ended September 30, 1998
Commission File Number: 33-42039
SEABULK AMERICA PARTNERSHIP, LTD.
State of Incorporation: Florida I.R.S. Employer I.D. 59-2324484
2200 Eller Drive
P.O. Box 13038
Ft. Lauderdale, Florida 33316
(954) 524-4200
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 twelve 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 ninety days.
Yes No X
SEABULK AMERICA PARTNERSHIP, LTD.
Quarter ended September 30, 1998
Index
Page
Part I. Financial Information
Item 1. Financial Statements ............................................ 1
Condensed Balance Sheets at December 31, 1997
and September 30, 1998 (Unaudited)..................................... 2
Condensed Statements of Operations for the three and nine months
ended September 30, 1997 and 1998 (Unaudited).......................... 3
Condensed Statements of Cash Flows for the nine months
ended September 30, 1997 and 1998 (Unaudited).......................... 4
Notes to Condensed Financial Statements................................ 5
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations................... 7
Part II. Other Information
Item 6. Reports on Form 8-K.............................................. 8
Signature................................................................. 8
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
Seabulk America Partnership, Ltd.
Balance Sheets
(in thousands)
December 31, September 30,
1997 1998
---------------- ---------------
(Unaudited)
Assets
Cash and cash equivalents.................................................. $ 1 $ 1
Investment in affiliate.................................................... 2,723 2,766
---------------- ---------------
Total assets........................................................... $ 2,724 $ 2,767
================ ===============
Liabilities and partners' equity
Due to affiliates, net .................................................... $ 20 $ 22
Commitments and contingencies
Partners' equity .......................................................... 2,704 2,745
---------------- --------------
$ 2,724 $ 2,767
================ ===============
See accompanying notes.
Seabulk America Partnership, Ltd.
Statement of Operations
(in thousands)
Three Months Ended Nine Months Ended
September 30, September 30,
1997 1998 1997 1998
------------ ------------ ------------ -------
(Unaudited) (Unaudited)
Expenses:
Professional fees........................................ $ -- $ 1 $ -- $ 1
Other.................................................... -- -- -- 1
Interest................................................. -- -- -- --
------------ ------------ ------------ -----------
Total Expenses......................................... -- 1 -- 2
Equity income loss in earnings of affiliate................... 14 (25) (102) 43
------------ ------------ ------------ -----------
Net Income.................................................... $ 14 (26) (103) 41
=========== ============- ============ ===========
See accompanying notes.
Seabulk America Partnership, Ltd.
Statements of Cash Flows
(in thousands)
Nine Months Ended
September 30,
1997 1998
----------- --------
(Unaudited)
Operating activities
Net income ....................................................................... $ (103) $ 41
Adjustments to reconcile net income to net cash
provided by operating activities:
Undistributed earnings of affiliate.......................................... 103 (43)
----------- ----------
Changes in operating assets and liabilities:
Due to affiliates............................................................ -- 2
Net cash provided by operating activities ........................................ -- --
Change in cash and cash equivalents .............................................. -- --
Cash and cash equivalents at beginning of year ................................... 1 1
----------- ----------
Cash and cash equivalents at end of year ......................................... $ 1 $ 1
========= =========
See accompanying notes.
SEABULK AMERICA PARTNERSHIP, LTD.
NOTES TO FINANCIAL STATEMENTS
September 30, 1998
1. Organization and Description of Business
Seabulk America Partnership, Ltd. (the "Partnership"), a Florida
limited partnership, was formed on September 14, 1983. The general partner of
the Partnership is Seabulk Tankers, Ltd. ("STL"), a Florida limited partnership
(which owns an 81.59% interest in the Partnership), and the limited partner is
Stolt Tankers (U.S.A.) Inc. (which owns an 18.41% interest in the Partnership).
STL is a 100% owned subsidiary of Hvide Marine Incorporated ("HMI").
The Partnership is a pass-through investment entity, the only asset of
which is a 41.67% limited partnership interest in Seabulk Transmarine
Partnership, Ltd. ("STPL"). STPL's primary asset is the Seabulk America, a
46,300 deadweight ton chemical product carrier. The Seabulk America is used to
transport chemicals, primarily from chemical manufacturing plants and storage
facilities along the U.S. Gulf of Mexico coast to industrial users in and around
Atlantic and Pacific coast ports. The Partnership time charters the Seabulk
America to Ocean Specialty Tankers Corp. ("OSTC"), which is 100% owned by HMI.
2. Partnership Agreement
The general partner is responsible for the management of the
Partnership. Pursuant to the partnership agreement (the "Agreement"), the
general partner and the limited partners (collectively referred to as the
"Partners") are required to make capital contributions at such times and in such
amounts as the general partner requests by notice. No additional capital
contributions have been required for 1996, 1997 or the nine months ended
September 30, 1998. The Partners are not entitled to withdraw any part of the
capital account or to receive any distribution from the Partnership except as
specifically provided in the Agreement. All net income or net losses of the
Partnership are allocated to the capital accounts in proportion to the
partnership interests. The Partnership terminates on September 13, 2008, unless
sooner terminated, liquidated or dissolved by law or pursuant to the Agreement
or unless extended by amendment to the Agreement.
3. Transactions with Affiliates
Balances due (to) from affiliates consist of the following (in
thousands):
December 31, September 30,
------------- -------------
1997 1998
Due to HMI $ (31) $ (31)
Due from STL (2) (2)
Due from STPL 13 13
-------------- -------------
Total due to affiliates $ (20) $ (22)
============= =============
The amount payable to HMI reflects various transactions between the
Partnership and HMI. There are no terms of settlement associated with the
account balance. The balance is primarily the result of the Partnership's
participation in HMI's central cash management program, in which substantially
all the Partnership's cash receipts are remitted to HMI and substantially all
cash disbursements are funded by HMI. Other transactions include miscellaneous
other administrative expenses incurred by HMI on behalf of the Partnership.
HMI provides various administrative services to the Partnership, including legal
assistance and technical expertise on ship management and maintenance. It is
HMI's policy to charge these expenses and all other central operating costs on
the basis of direct usage when identifiable, with the remainder allocated
pursuant to the terms of the Agreement. Amounts charged by HMI include a monthly
management fee, as set forth in the Agreement, which is adjusted annually based
on changes in the Consumer Price Index. HMI also charges interest based on the
amount due to HMI. In the opinion of the Partnership's management, this method
of allocation is reasonable.
4. Guarantees of Indebtedness of Others
In February 1998, HMI completed an offering of $300.0 million of 8.375%
senior notes (the "Senior Notes"). Interest on the Senior Notes is payable
semi-annually in arrears on February 15 and August 15. The Senior Notes mature
on February 15, 2008 and are redeemable, in whole or in part, at the option of
HMI on or after February 15, 2003. The Senior Notes are guaranteed by the
Partnership and certain other HMI subsidiaries; however, the Partnership's
guarantee is limited to HMI's approximately 67% economic ownership interest in
STPL's operating vessel, the Seabulk America.
HMI's credit facility with a group of banks (the "Credit Facility")
provides for revolving credit loans aggregating up to $175 million, subject to
certain conditions. The Credit Facility also provides for a term loan in the
amount of $150 million. The Credit Facility provides that borrowings thereunder
will be secured by HMI-owned vessels, including the Seabulk America, having an
appraised value of at least $600.0 million and by substantially all other assets
of HMI and its subsidiaries. The revolving and term loan portions mature on
February 12, 2003 and September 30, 2005 respectively. At September 30, 1998,
HMI's outstanding indebtedness under the revolving credit portion of the Credit
Facility was approximately $121 million, and approximately $139 million was
outstanding under the term loan portion of the Credit Facility. The Partnership
and certain other subsidiaries of HMI also jointly and severally guarantee the
repayment of HMI's indebtedness under the Credit Facility; however, the
Partnership's guarantee is limited to HMI's 67% ownership interest in the
Seabulk America.
5. Income Taxes
The Partnership has received a ruling from the Internal Revenue Service
that it will be classified as a partnership for federal income tax purposes.
Accordingly, no provision for income taxes is made in the financial statements
of the Partnership. Taxable income or loss of the Partnership is reported in the
income tax returns of the Partners.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The Partnership has no revenues or expenses. Any income is derived from
its equity investment in STPL (see the financial statements of STPL included at
the end of this report beginning on page S-1).
PART II. OTHER INFORMATION
Item 6. Reports on Form 8-K
b. Reports on Form 8-K.
Not Applicable
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed by the following persons in the capacities and on
the dates indicated.
SEABULK AMERICA PARTNERSHIP, LTD.
By: SEABULK TANKERS, Ltd.
its General Partner
By: HVIDE MARINE TRANSPORT, INCORPORATED
its General Partner
By: /s/ JOHN H. BLANKLEY
John H. Blankley, Executive Vice President,
Chief Financial Officer and Director
Date: July 30, 1999