Exhibit 99(d)(3)
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 March 31, 1997
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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 0-14206
Cable TV Fund 12-D, LTD.
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Exact name of registrant as specified in charter
Colorado 84-1010423
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State of organization I.R.S. employer I.D.#
9697 East Mineral Avenue, P.O. Box 3309, Englewood, Colorado 80155-3309
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Address of principal executive office
(303) 792-3111
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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
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CABLE TV FUND 12-D, LTD.
------------------------
(A Limited Partnership)
UNAUDITED CONSOLIDATED BALANCE SHEETS
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March 31, December 31,
ASSETS 1997 1996
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CASH AND CASH EQUIVALENTS $ 1,500,420 $ 1,514,773
RECEIVABLES:
Trade receivables, less allowance for doubtful receivables of $438,884
and $417,017 at March 31, 1997 and December 31, 1996, respectively 3,360,883 2,676,246
INVESTMENT IN CABLE TELEVISION PROPERTIES:
Property, plant and equipment, at cost 203,332,199 198,322,316
Less- accumulated depreciation (98,911,127) (95,040,023)
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104,421,072 103,282,293
Franchise costs and other intangible assets, net of accumulated
amortization of $61,350,497 and $60,652,010 at
March 31, 1997 and December 31, 1996, respectively 9,690,657 10,389,144
------------ ------------
Total investment in cable television properties 114,111,729 113,671,437
DEPOSITS, PREPAID EXPENSES AND DEFERRED CHARGES 4,571,563 3,036,880
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Total assets $123,544,595 $120,899,336
============ ============
The accompanying notes to unaudited consolidated financial statements
are an integral part of these unaudited consolidated balance sheets.
2
CABLE TV FUND 12-D, LTD.
------------------------
(A Limited Partnership)
UNAUDITED CONSOLIDATED BALANCE SHEETS
-------------------------------------
March 31, December 31,
LIABILITIES AND PARTNERS' DEFICIT 1997 1996
--------------------------------- ------------- -------------
LIABILITIES:
Debt $140,721,622 $138,345,878
Trade accounts payable and accrued liabilities 5,723,513 4,499,549
Subscriber prepayments 451,591 445,391
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Total liabilities 146,896,726 143,290,818
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MINORITY INTEREST IN JOINT VENTURE (5,967,338) (5,732,382)
------------ ------------
PARTNERS' DEFICIT:
General Partner-
Contributed capital 1,000 1,000
Accumulated deficit (80,591) (73,334)
------------ ------------
(79,591) (72,334)
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Limited Partners-
Net contributed capital (237,339 units outstanding
at March 31, 1997 and December 31, 1996) 102,198,175 102,198,175
Accumulated deficit (77,956,377) (77,237,941)
Distributions (41,547,000) (41,547,000)
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(17,305,202) (16,586,766)
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Total liabilities and partners' deficit $123,544,595 $120,899,336
============ ============
The accompanying notes to unaudited consolidated financial statements
are an integral part of these unaudited consolidated balance sheets.
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CABLE TV FUND 12-D, LTD.
------------------------
(A Limited Partnership)
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
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For the Three Months Ended
March 31,
--------------------------
1997 1996
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REVENUES $19,711,225 $ 23,545,320
COSTS AND EXPENSES:
Operating expenses 10,953,865 14,739,857
Management fees and allocated overhead
from Jones Intercable, Inc. 2,316,066 2,778,348
Depreciation and amortization 4,798,547 6,119,036
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OPERATING INCOME (LOSS) 1,642,747 (91,921)
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OTHER INCOME (EXPENSE):
Interest expense (2,691,262) (3,161,193)
Gain on sale of cable television system - 72,137,615
Other, net 87,866 862
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Total other income (expense), net (2,603,396) 68,977,284
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CONSOLIDATED NET INCOME (LOSS) (960,649) 68,885,363
MINORITY INTEREST IN CONSOLIDATED
NET INCOME (LOSS) 234,956 (16,849,360)
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NET INCOME (LOSS) $ (725,693) $ 52,036,003
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ALLOCATION OF NET INCOME (LOSS):
General Partner $ (7,257) $ (24,568)
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Limited Partners $ (718,436) $ 52,060,571
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NET INCOME (LOSS) PER LIMITED PARTNERSHIP UNIT $(3.03) $219.35
=========== ============
WEIGHTED AVERAGE NUMBER OF LIMITED
PARTNERSHIP UNITS OUTSTANDING 237,339 237,339
=========== ============
The accompanying notes to unaudited consolidated financial statements
are an integral part of these unaudited consolidated statements.
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CABLE TV FUND 12-D, LTD.
------------------------
(A Limited Partnership)
UNAUDITED CONSOLIDATED STATEMENTS OF CASH FLOWS
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For the Three Months Ended
March 31,
--------------------------
1997 1996
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CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ (725,693) $ 52,036,003
Adjustments to reconcile net income (loss) to net
cash provided by (used in) operating activities:
Depreciation and amortization 4,798,547 6,117,468
Gain on sale of cable television system - (72,137,615)
Minority interest in consolidated income (loss) (234,956) 16,849,360
Decrease (increase) in trade receivables (684,637) 1,846,166
Increase in deposits, prepaid expenses and
deferred charges (1,763,639) (1,749,256)
Increase (decrease) in trade accounts payable and
accrued liabilities and subscriber prepayments 1,230,164 (4,863,118)
Decrease in amount due Jones Intercable, Inc. - (4,198,739)
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Net cash provided by (used in) operating activities 2,619,786 (6,099,731)
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CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of property and equipment, net (5,009,883) (5,127,874)
Proceeds from sale of cable television system - 110,395,667
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Net cash provided by (used in) investing activities (5,009,883) 105,267,793
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CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings 6,420,666 66,300,000
Repayment of debt (4,044,922) (110,601,235)
Distributions to Limited Partners - (41,547,000)
Distributions to Joint Venture Partners - (13,453,000)
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Net cash provided by (used in) financing activities 2,375,744 (99,301,235)
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Decrease in cash and cash equivalents (14,353) (133,173)
Cash and cash equivalents, beginning of period 1,514,773 1,384,794
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Cash and cash equivalents, end of period $ 1,500,420 $ 1,251,621
=========== =============
SUPPLEMENTAL CASH FLOW DISCLOSURE:
Interest paid $ 1,481,270 $ 6,076,065
=========== =============
The accompanying notes to unaudited consolidated financial statements
are an integral part of these unaudited consolidated statements.
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CABLE TV FUND 12-D, LTD.
------------------------
(A Limited Partnership)
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
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(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 fair 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 Cable TV Fund 12-D, Ltd. (the
"Partnership") at March 31, 1997 and December 31, 1996 and its Statements of
Operations and Cash Flows for the three month periods ended March 31, 1997 and
March 31, 1996. Results of operations for these periods are not necessarily
indicative of results to be expected for the full year.
The accompanying consolidated financial statements include 100 percent of
the accounts of the Partnership and those of Cable TV Fund 12-BCD Venture (the
"Venture") reduced by the 24 percent minority interest in the Venture. All
interpartnership accounts and transactions have been eliminated. During the
three month period ended March 31, 1997, the Venture owned and operated the
cable television systems serving the areas in and around Albuquerque, New Mexico
(the "Albuquerque System") and Palmdale, California (the "Palmdale System").
The Venture sold the cable television system serving the areas in and around
Tampa, Florida (the "Tampa System") on February 28, 1996.
(2) Jones Intercable, Inc., a publicly held Colorado corporation (the "General
Partner"), manages the Partnership and the Venture and receives a fee for its
services equal to 5 percent of the gross revenues of the Venture, excluding
revenues from the sale of cable television systems or franchises. Management
fees for the three month periods ended March 31, 1997 and 1996 were $985,561 and
$1,177,266, respectively.
The Venture reimburses the General Partner for certain allocated overhead
and administrative expenses. These expenses represent the salaries and related
benefits paid for corporate personnel, rent, data processing services, and other
corporate facilities costs. Such personnel provide engineering, marketing,
administrative, accounting, legal and investor relations services to the
Venture. Such services, and their related costs, are necessary to the operation
of the Venture and would have been incurred by the Venture if it was a stand
alone entity. Allocations of personnel costs are based upon actual time spent by
employees of the General Partner with respect to each partnership managed.
Remaining expenses are allocated based on the pro rata relationship of the
Venture's revenues to the total revenues of all systems owned or managed by the
General Partner and certain of its subsidiaries. Systems owned by the General
Partner and all other systems owned by partnerships for which Jones Intercable,
Inc. is the general partner are also allocated a proportionate share of these
expenses. The General Partner believes that the methodology used in allocating
overhead and administrative expenses is reasonable. Reimbursements by the
Venture to the General Partner for allocated overhead and administrative
expenses for the three month periods ended March 31, 1997 and 1996 were
$1,330,505 and $1,601,082, respectively.
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CABLE TV FUND 12-D, 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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It is the General Partner's publicly announced policy that it intends to
liquidate its managed limited partnerships, including the partnerships that
comprise the Venture, as opportunities for sales of partnership cable television
systems arise in the marketplace over the next several years. In accordance
with the General Partner's policy, the Venture sold the Tampa System in February
1996. No specific dates or terms have yet been set for the sale of the
remainder of the Venture's systems.
For the three months ended March 31, 1997, the Venture generated net cash
from operating activities totaling $2,619,786, which was available to fund
capital expenditures and non-operating costs. Capital expenditures for the
Venture totaled approximately $5,010,000 during the first quarter of 1997.
Service drops to homes accounted for approximately 42 percent of the capital
expenditures. New plant construction accounted for approximately 29 percent of
the capital expenditures. Converters accounted for approximately 19 percent of
the capital expenditures. The remaining expenditures related to various system
enhancements. These capital expenditures were funded primarily from cash on
hand, cash generated from operations and borrowings from the Venture's credit
facility. Expected capital expenditures for the remainder of 1997 are
approximately $15,300,000. Service drops to homes are anticipated to account
for approximately 52 percent. Approximately 14 percent of budgeted capital
expenditures is for new plant construction. Plant rebuild is anticipated to
account for approximately 14 percent. The remainder of the expenditures are for
various system enhancements in all of the Venture's systems. These capital
expenditures are necessary to maintain the value of the Venture's systems.
Funding for these expenditures is expected to be provided by cash on hand, cash
generated from operations and borrowings from the Venture's credit facility.
The Venture's debt arrangements at March 31, 1997 consisted of
$51,436,531 of Senior Notes placed with a group of institutional lenders and a
$120,000,000 credit facility with a group of commercial bank lenders. The
Senior Notes and the credit facility are equal in standing with the other, and
both are equally secured by the assets of the Venture.
The Senior Notes have a fixed interest rate of 8.64 percent and a final
maturity date of March 31, 2000. The Senior Notes require payments of interest
and accelerating principal through maturity, payable semi-annually in March and
September. A principal payment of $3,956,656 was made in March 1997. A
principal payment of approximately $3,956,656 is due in September 1997 and is
expected to be funded from cash on hand, cash generated from operations and
borrowings from the Venture's credit facility.
The balance outstanding on the Venture's $120,000,000 credit facility at
March 31, 1997 was $88,530,620, leaving $31,469,380 available for future needs.
At the Venture's option, the credit facility is payable in full on December 31,
1999 or converts to a term loan that matures on December 31, 2004 payable in
consecutive quarterly amounts. Interest on the amended credit facility is at
the Venture's option of the London Interbank Offered Rate plus 1.125 percent,
the Prime Rate plus .125 percent or the Certificate of Deposit Rate plus 1.25
percent. The effective interest rates on amounts outstanding on the Venture's
credit facility as of March 31, 1997 and 1996 were 7.66 percent and 8.35
percent, respectively.
The Venture has sufficient sources of capital available through its
ability to generate cash from operations and borrowings under its credit
facility to meet its presently anticipated operating needs.
RESULTS OF OPERATIONS
- ---------------------
Revenues in the Venture's systems decreased $3,834,095, or approximately
16 percent, to $19,711,225 for the three months ended March 31, 1997 from
$23,545,320 for the similar period in 1996. This decrease was a result of the
sale of the Tampa System. Disregarding the effect of the Tampa System sale,
revenues would have increased $1,051,296, or approximately 6 percent, to
$19,711,225 for the three months ended March 31, 1997 from $18,659,929 for the
similar period in 1996. The increase in revenue was due primarily to basic
service rate increases and an increase in advertising
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activity. Basic service rate increases accounted for approximately 59 percent of
the increase in revenues for the three months ended March 31, 1997. Advertising
activity accounted for approximately 18 percent of the increase in revenues for
the three months ended March 31, 1997. No other individual factor significantly
affected the increase in revenues.
Operating expenses consist primarily of costs associated with the
operation and administration of the Venture's cable television systems. The
principal cost components are salaries paid to system personnel, programming
expenses, professional fees, subscriber billing costs, rent for leased
facilities, cable system maintenance expenses and marketing expenses.
Operating expenses in the Venture's systems decreased $3,785,992, or
approximately 26 percent, to $10,953,865 for the three months ended March 31,
1997 from $14,739,857 for the similar period in 1996. This decrease was a
result of the sale of the Tampa System. Disregarding the effect of the Tampa
System sale, operating expenses would have increased $60,612, or approximately 1
percent, to $10,953,865 for the three months ended March 31, 1997 from
$10,893,253 for the similar period in 1996. Operating expenses represented 56
percent and 58 percent, respectively, of revenues for the three months ended
March 31, 1997 and 1996. The increase in operating expenses was primarily due
to increases in programming costs. No other individual factor contributed
significantly to the increase in operating expenses.
The cable television industry generally measures the financial
performance of a cable television system in terms of operating cash flow
(revenues less operating expenses). This measure is not intended to be a
substitute or improvement upon the items disclosed on the financial statements,
rather it is included because it is an industry standard. Operating cash flow
decreased $48,103, or approximately 1 percent, to $8,757,360 for the three
months ended March 31, 1997 from $8,805,463 for the similar period in 1996.
Disregarding the effect of the Tampa System sale, operating cash flow would have
increased $990,684, or approximately 13 percent, to $8,757,360 for the three
months ended March 31, 1997 from $7,766,676 for the similar 1996 period. This
increase was due to the increase in revenues exceeding the increases in
operating expenses.
Management fees and allocated overhead from the General Partner decreased
$462,282, or approximately 17 percent, to $2,316,066 for the three months ended
March 31, 1997 from $2,778,348 for the similar period in 1996. This decrease
was a result of the sale of the Tampa System. Disregarding the effect of the
Tampa System sale, management fees and allocated overhead from the General
Partner would have increased $114,194, or approximately 5 percent, to $2,316,066
for the three months ended March 31, 1997 from $2,201,872 for the similar period
in 1996. This increase was primarily due to the increase in revenues, upon
which such management fees are based. This increase was partially offset by a
decrease in allocated overhead from the General Partner.
Depreciation and amortization expense decreased $1,320,489, or
approximately 22 percent, to $4,798,547 for the three months ended March 31,
1997 from $6,119,036 for the similar period in 1996. This decrease was a result
of the sale of the Tampa System. Disregarding the effect of the Tampa System
sale, depreciation and amortization expense would have decreased $241,046, or
approximately 5 percent, to $4,798,547 for the three months ended March 31, 1997
from $5,039,593 for the similar period in 1996. This decrease was due to the
maturation of the Venture's asset base.
The Venture recognized operating income of $1,642,747 for the three
months ended March 31, 1997 compared to an operating loss of $91,921 for the
similar period in 1996. Disregarding the effect of the Tampa System sale, the
Venture's operating income would have increased $1,117,536, to $1,642,747 for
the three month period ended March 31, 1997 from $525,211 for the similar period
in 1996. This increase was due to the increase in revenues and the decrease in
depreciation and amortization expenses exceeding the increases in operating
expenses and management fees and allocated overhead expenses from the General
Partner.
Interest expense decreased $469,931, or approximately 15 percent, to
$2,691,262 for the three months ended March 31, 1997 from $3,161,193 for the
similar period in 1996. This decrease in interest expense was primarily due to
the lower outstanding balances and lower effective interest rates on the
Venture's interest bearing obligations.
The Venture recognized a gain of $72,137,615 related to the sale of the
Tampa System in February 1996. No similar gain was recognized in 1997.
The Venture reported a net loss of $960,649 for the three months ended
March 31, 1997 compared to net income of $68,885,363 for the similar period in
1996. This change was due to the gain on the sale of the Tampa System in
February 1996.
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PART II - OTHER INFORMATION
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.
CABLE TV FUND 12-D, LTD.
BY: JONES INTERCABLE, INC.
General Partner
By: /S/ Kevin P. Coyle
-------------------------------
Kevin P. Coyle
Group Vice President/Finance
(Principal Financial Officer)
Dated: May 13, 1997
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