FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
[X] Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the quarterly period ended September 30, 2000
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[_] 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: 0-14906
JONES CABLE INCOME FUND 1-B, LTD.
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Exact name of registrant as specified in charter
Colorado #84-1010417
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State of organization I.R.S. employer I.D. #
c/o Comcast Corporation
1500 Market Street, Philadelphia, PA 19102-2148
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Address of principal executive office
(215) 665-1700
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Registrant's telephone number
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 ___
___
JONES CABLE INCOME FUND 1-B, LTD.
---------------------------------
(A Limited Partnership)
UNAUDITED BALANCE SHEETS
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September 30, December 31,
ASSETS 2000 1999
------ ------------------- --------------------
Cash $ 1,111,848 $ -
Receivable from affiliate 38,709 -
Distribution receivable from Cable Television Joint Venture - 2,500,000
Investment in Cable Television Joint Venture - 249,321
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Total assets $ 1,150,557 $ 2,749,321
=================== ====================
LIABILITIES AND PARTNERS' CAPITAL
---------------------------------
LIABILITIES:
Accrued liabilities $ 33,342 $ -
Advances from affiliates - 112,000
Accrued distribution to limited partners - 1,500,000
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Total liabilities 33,342 1,612,000
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PARTNER'S CAPITAL:
General Partner-
Contributed capital 1,000 1,000
Distributions (110,219) (110,219)
Accumulated earnings 109,219 109,219
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- -
------------------- --------------------
Limited Partners-
Net contributed capital (83,884 units outstanding
at September 30, 2000 and December 31, 1999) 34,449,671 34,449,671
Distributions (46,288,222) (46,288,222)
Accumulated earnings 12,955,766 12,975,872
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1,117,215 1,137,321
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Total liabilities and partners' capital $ 1,150,557 $ 2,749,321
=================== ====================
The accompanying notes to unaudited financial statements
are an integral part of these unaudited balance sheets.
2
JONES CABLE INCOME FUND 1-B, LTD.
---------------------------------
(A Limited Partnership)
UNAUDITED STATEMENTS OF OPERATIONS
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For the Three Months Ended For the Nine Months Ended
September 30, September 30,
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2000 1999 2000 1999
---------- ---------- ---------- ----------
OTHER INCOME (EXPENSE):
Interest income $ 68,673 $ - $ 68,673 $ -
Other, net (47,241) (42,627) (88,779) (48,440)
---------- ---------- ---------- ----------
Total other income (expense), net 21,432 (42,627) (20,106) (48,440)
---------- ---------- ---------- ----------
EQUITY IN NET INCOME OF CABLE
TELEVISION JOINT VENTURE - 2,507,294 - 2,666,306
---------- ---------- ---------- ----------
NET INCOME (LOSS) $ 21,432 $2,464,667 $ (20,106) $2,617,866
========== ========== ========== ==========
ALLOCATION OF NET INCOME (LOSS):
General Partner $ - $ (1,532) $ - $ -
========== ========== ========== ==========
Limited Partners $ 21,432 $2,466,199 $ (20,106) $2,617,866
========== ========== ========== ==========
NET INCOME (LOSS) PER LIMITED
PARTNERSHIP UNIT $ 0.26 $ 29.40 $ (0.24) $ 31.21
========== ========== ========== ==========
WEIGHTED AVERAGE NUMBER OF
LIMITED PARTNERSHIP UNITS
OUTSTANDING 83,884 83,884 83,884 83,884
========== ========== ========== ==========
The accompanying notes to unaudited financial statements
are an integral part of these unaudited statements.
3
JONES CABLE INCOME FUND 1-B, LTD.
---------------------------------
(A Limited Partnership)
UNAUDITED STATEMENTS OF CASH FLOWS
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For the Nine Months Ended
September 30,
--------------------------------------------
2000 1999
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CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (20,106) $ 2,617,866
Adjustments to reconcile net income (loss) to net cash
used in operating activities:
Equity in net income of Cable Television Joint Venture - (2,666,306)
Increase in accrued liabilities 33,342 -
Increase (decrease) in advances from affiliates (150,709) 48,440
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Net cash used in operating activities (137,473) -
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CASH FLOWS FROM INVESTING ACTIVITIES:
Distribution from Cable Television Joint Venture 2,749,321 -
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Net cash provided by investing activities 2,749,321 -
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CASH FLOWS FROM FINANCING ACTIVITIES:
Distribution to limited partners (1,500,000) -
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Net cash used in financing activities (1,500,000) -
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Increase in cash 1,111,848 -
Cash, beginning of period - -
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Cash, end of period $ 1,111,848 $ -
================== ===================
SUPPLEMENTAL CASH FLOW DISCLOSURE:
Interest paid $ 5,625 $ -
================== ===================
The accompanying notes to unaudited financial statements
are an integral part of these unaudited statements.
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JONES CABLE INCOME FUND 1-B, LTD.
---------------------------------
(A Limited Partnership)
NOTES TO UNAUDITED FINANCIAL STATEMENTS
---------------------------------------
(1) This Form 10-Q is being filed in conformity with the SEC requirements
for unaudited financial statements and does not contain all of the necessary
footnote disclosures required for a complete presentation of the Balance Sheets
and Statements of Operations and Cash Flows in conformity with generally
accepted accounting principles. However, in the opinion of management, this data
includes all adjustments, consisting only of normal recurring accruals,
necessary to present fairly the financial position of Jones Cable Income Fund 1-
B, Ltd. (the "Partnership") at September 30, 2000 and December 31, 1999, its
Statements of Operations for the three and nine month periods ended September
30, 2000 and 1999 and its Statements of Cash Flows for the nine month periods
ended September 30, 2000 and 1999. Certain prior period amounts have been
reclassified to conform to the 2000 presentation.
The Partnership owns a 40 percent interest in Jones Cable Income Fund 1-
B/C Venture (the "Venture"). Jones Cable Income Fund 1-C, Ltd. ("Fund 1-C") owns
a 60 percent interest in the Venture. Neither the Partnership nor the Venture
currently own any cable television systems. The Partnership's interest in the
Venture is accounted for using the equity method. The Venture distributed its
remaining cash to the Partnership and Fund 1-C in September 2000 and the Venture
is expected to be dissolved in December 2000. The Partnership's only current
assets are its cash on hand and a receivable from affiliate, which will be paid
in the fourth quarter of 2000. It is anticipated that the Partnership will be
fully liquidated and dissolved by December 31, 2000.
Prior to its dissolution, the Partnership will accrue funds to cover its
remaining administrative costs. All cash remaining after such accrual is made
will be distributed to the Partnership's partners pursuant to the distribution
procedures established by the Partnership's limited partnership agreement. It is
expected that all limited partners will receive final distribution checks from
the Partnership before the end of December 2000.
On April 7, 1999, Comcast Corporation ("Comcast") completed the
acquisition of a controlling interest in Jones Intercable, Inc. ("Jones
Intercable"), the Partnership's general partner until March 2, 2000. In December
1999, Comcast and Jones Intercable entered into a definitive merger agreement
pursuant to which Comcast agreed to acquire all of the outstanding shares of
Jones Intercable not yet owned by Comcast. On March 2, 2000, Jones Intercable
was merged with and into Comcast JOIN Holdings, Inc., a wholly owned subsidiary
of Comcast. As a result of this transaction, Jones Intercable no longer exists
and Comcast JOIN Holdings, Inc. continued as the surviving corporation of the
merger. On August 1, 2000, Comcast JOIN Holdings, Inc. was merged with and into
Comcast Cable Communications, Inc., ("Comcast Cable"), another wholly owned
subsidiary of Comcast. Comcast Cable is now the general partner of the
Partnership. References in these Notes to "the General Partner" refer to Comcast
Cable. The General Partner shares corporate offices with Comcast at 1500 Market
Street, Philadelphia, Pennsylvania 19102-2148.
(2) On July 30, 1999, the Venture sold the Myrtle Creek System to an
unaffiliated party for a sales price of $9,614,208. From the sale proceeds, the
Venture repaid the outstanding balance on its credit facility of $2,400,000,
paid a $240,355 brokerage fee to The Intercable Group, Ltd., a subsidiary of
Jones Intercable, representing 2.5 percent of the sales price, for acting as a
broker in the transaction, settled working capital adjustments and deposited
$500,000 into an interest-bearing indemnity escrow account. The remaining sale
proceeds of $6,300,000 were distributed 40 percent to the Partnership and 60
percent to Fund 1-C. From the Partnership's $2,500,000 portion of this amount,
the Partnership retained $1,000,000 to cover its administrative expenses and the
balance was distributed in January 2000 to the Partnership's limited partners of
record as of the July 30, 1999 closing date of the sale of the Myrtle Creek
System. The $1,500,000 distributed to the Partnership's limited partners from
the sale of the Myrtle Creek System resulted in a distribution to limited
partners of $18 for each $500 limited partnership interest, or $36 for each
$1,000 invested in the Partnership.
For a period of one year following the closing date, $500,000 of the
sale proceeds remained in escrow as security for the Venture's agreement to
indemnify the buyer under the asset purchase agreement. Amounts remaining from
this indemnity escrow account plus interest earned on the escrowed funds were
returned to the Venture in August 2000 and distributed to its constituent
partners in September 2000.
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(3) Financial information regarding the Venture is presented below.
UNAUDITED BALANCE SHEETS
------------------------
September 30, December 31,
ASSETS 2000 1999
------ ------------------- ------------------
Cash $ - $ 7,033,894
Proceeds from sale in interest-bearing account - 509,375
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Total assets $ - $ 7,543,269
=================== ==================
LIABILITIES AND PARTNERS' CAPITAL
---------------------------------
Accrued distributions to Venture Partners $ - $ 6,300,000
Advances from affiliates - 619,665
Partner's contributed capital, net (21,897,296) (21,273,692)
Accumulated earnings 21,897,296 21,897,296
------------------- ------------------
Total liabilities and partners' capital $ - $ 7,543,269
=================== ==================
UNAUDITED STATEMENTS OF OPERATIONS
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For the Three Months Ended For the Nine Months Ended
September 30, September 30,
-------------------------- -------------------------
2000 1999 2000 1999
---------- ---------- ---------- ----------
Revenues $ - $ 188,993 $ - $1,384,006
Operating expenses - 184,450 - 909,868
Management fees and allocated overhead
from Jones Intercable - 17,843 - 146,326
Depreciation and amortization - 64,186 - 461,230
---------- ---------- ---------- ----------
Operating loss - (77,486) - (133,418)
---------- ---------- ---------- ----------
Interest expense - (3,514) - (84,280)
Interest income - 57,789 - 72,954
Gain on sale of cable television system - 6,350,069 - 6,350,069
Other, net - (22,376) - 498,991
---------- ---------- ---------- ----------
Net income $ - $6,304,482 $ - $6,704,316
========== ========== ========== ==========
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(4) The Partnership reimburses its general partner for certain
administrative expenses. These expenses represent the salaries and related
benefits paid for corporate personnel. Such personnel provide administrative,
accounting, tax, legal and investor relations services to the Partnership. Such
services, and their related costs, are necessary to the administration of the
Partnership until it is dissolved. Such costs were charged to other expense on
the Statements of Operations. Reimbursements made by the Partnership to its
general partner for administrative expenses during the three and nine month
periods ended September 30, 2000 were $6,926 and $26,204, respectively.
Reimbursements by the Venture to its general partner for administrative expenses
during the three and nine month periods ended September 30, 1999 were $8,394 and
$77,126, respectively, of which $3,338 and $30,673, respectively, were
attributed to the Partnership's 40 percent interest in the Venture.
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JONES CABLE INCOME FUND 1-B, LTD.
---------------------------------
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
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RESULTS OF OPERATIONS
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FINANCIAL CONDITION
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The Partnership owns a 40 percent interest in the Venture. This
investment is accounted for under the equity method.
On July 30, 1999, the Venture sold the Myrtle Creek System to an
unaffiliated party for a sales price of $9,614,208. From the sale proceeds, the
Venture repaid all of its indebtedness, paid a brokerage fee, settled working
capital adjustments and deposited $500,000 into an interest-bearing indemnity
escrow account. The remaining sale proceeds of $6,300,000 were distributed 40
percent to the Partnership and 60 percent to Fund 1-C. From the Partnership's
$2,500,000 portion of this amount, the Partnership retained $1,000,000 to cover
its administrative expenses and the balance was distributed in January 2000 to
the Partnership's limited partners of record as of the July 30, 1999 closing
date of the sale of the Myrtle Creek System. The $1,500,000 distributed to the
Partnership's limited partners from the sale of the Myrtle Creek System resulted
in a distribution to limited partners of $18 for each $500 limited partnership
interest, or $36 for each $1,000 invested in the Partnership.
For a period of one year following the closing date, $500,000 of the
sale proceeds remained in escrow as security for the Venture's agreement to
indemnify the buyer under the asset purchase agreement. Amounts remaining from
this indemnity escrow account plus interest earned on the escrowed funds were
returned to the Venture in August 2000 and distributed to its constituent
partners in September 2000.
Neither the Partnership nor the Venture currently own any cable
television systems. The Venture distributed its remaining cash to the
Partnership and Fund 1-C in September 2000 and the Venture is expected to be
dissolved in December 2000. The Partnership's only current assets are its cash
on hand and a receivable from affiliate, which will be paid in the fourth
quarter of 2000. It is anticipated that the Partnership will be fully liquidated
and dissolved by December 31, 2000.
Prior to its dissolution, the Partnership will accrue funds to cover its
remaining administrative costs. All cash remaining after such accrual is made
will be distributed to the Partnership's partners pursuant to the distribution
procedures established by the Partnership's limited partnership agreement. It is
expected that all limited partners will receive final distribution checks from
the Partnership before the end of December 2000.
The Partnership's current and periodic reporting obligations under the
Securities Exchange Act of 1934, as amended, and the Partnership's quarterly and
annual reporting obligations under Section 3.7 of the Partnership's limited
partnership agreement will cease upon the Partnership's termination. As a
result, it is expected that this quarterly report on SEC Form 10-Q for the
quarter ended September 30, 2000 will be the Partnership's final detailed
financial report to limited partners.
During the first quarter of 2001, the General Partner will deliver final
tax reports on Form 1065, Schedule K-1 to all limited partners of record as of
the date of the Partnership's dissolution. If, as expected, the Partnership is
dissolved before the end of 2000, the Partnership and its partners will have no
tax reporting obligations beyond the taxable year 2000.
RESULTS OF OPERATIONS
- ---------------------
Neither the Partnership nor the Venture currently own any cable
television systems; therefore, a discussion of results of operations would not
be meaningful. Interest income of $68,673 was earned on the cash balance on
hand. The Partnership incurred other expense of $88,779 in the first nine months
of 2000, which related to various costs associated with the administration and
liquidation of the Partnership.
8
PART II - OTHER INFORMATION
Item 1. Legal Proceedings.
The Partnership and the General Partner are among the defendants in a
case captioned Everest Cable Investors, LLC, et al., plaintiffs v. Jones
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Intercable, Inc., et al., defendants (Superior Court, Los Angeles County, State
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of California, Case No. BC 213632). The case was originally filed in July 1999.
Subsequently, demurrers were sustained as to a substantial portion of the
action, and the court did not allow the plaintiffs to seek to amend and re-file
their claims. As a result, the plaintiffs elected to appeal the ruling of the
trial court as to the validity of their claims which had been dismissed. While
the appeal is pending, the trial court agreed to the parties' joint request to
stay the portion of the action that was not dismissed by the trial court when it
sustained the demurrers.
The Partnership has continued in existence since the sale of its cable
television system assets. The General Partner has determined, however, that it
is in the best interests of the Partnership and its limited partners to
liquidate and dissolve the Partnership before the end of the year 2000.
Although, prior to its dissolution, the Partnership will accrue funds to
pay for its remaining administrative expenses, the Partnership will not accrue
funds to cover its potential liabilities related to this litigation. Instead,
the General Partner will remain liable for the Partnership's liabilities, if
any, related to this case.
Item 6. Exhibits and Reports on Form 8-K.
a) Exhibits
27) Financial Data Schedule
b) Reports on Form 8-K
None
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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.
JONES CABLE INCOME FUND 1-B, LTD.
BY: COMCAST CABLE COMMUNICATIONS, INC.
General Partner
By: /S/ Lawrence J. Salva
-----------------------------------
Lawrence J. Salva
Senior Vice President
(Principal Accounting Officer)
Dated: November 14, 2000
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