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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
[X] Quarterly report under Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the quarterly period ended September 30, 1995
[ ] Transition report under Section 13 or 15(d) of the Exchange Act
Commission file number 0-8901
CASA MUNRAS HOTEL PARTNERS, L.P.
(Exact name of small business issuer as specified in its charter)
California 95-3235634
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5525 Oakdale Avenue, Suite 300, Woodland Hills, California 91364
(Address of principal executive offices)
(818) 888-6500
(Issuer's telephone number, including Area Code)
Check whether the issuer: (1) filed all reports required to be filed
by Section 13 or 15(d) of the Exchange Act during the past 12 months, and (2)
has been subject to such filing requirements for the past 90 days.
Yes x No
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Transitional Small Business Disclosure Format: Yes No x
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PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
The accompanying unaudited financial statements of Casa Munras
Hotel Partners, L.P. (formerly Western Host Monterey Partners) have been
prepared in accordance with generally accepted accounting principles for
interim financial information and with the instructions to Form 10-QSB.
Accordingly, these statements do not include all of the information and
footnotes required by generally accepted accounting principles for complete
financial statements. In the opinion of the General Partners of the
Registrant, all adjustments necessary for a fair presentation have been
included. The financial statements presented herein have been prepared in
accordance with the accounting policies described in the Registrant's Annual
Report on Form 10-KSB for the year ended December 31, 1994 and should be read
in connection therewith. The results of operations for the three and nine
month period ended September 30, 1995 are not necessarily indicative of the
results to be expected for the full year.
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CASA MUNRAS HOTEL PARTNERS, L.P.
(A Limited Partnership)
BALANCE SHEETS
(Unaudited)
September 30, December 31,
1995 1994
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ASSETS
CURRENT ASSETS:
Cash $ 694,164 $ 287,907
Accounts receivable 185,225 89,448
Food and beverage inventories 19,054 16,340
Prepaid expenses 35,790 46,123
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Total current assets 934,233 439,818
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LAND, PROPERTY AND EQUIPMENT - at cost:
Building and improvements 4,409,221 4,405,061
Hotel furnishings and equipment 1,037,166 1,032,648
Restaurant furnishings and equipment 20,931 6,721
Less accumulated depreciation (3,072,280) (2,829,280)
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2,395,038 2,615,150
Land 700,000 700,000
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Land, property and equipment - net 3,095,038 3,315,150
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OTHER ASSETS:
Liquor license 40,000 40,000
Loan commitment fee - net 5,833
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Total other assets 40,000 45,833
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TOTAL $ 4,069,271 $ 3,800,801
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LIABILITIES AND PARTNERS' EQUITY
CURRENT LIABILITIES:
Accounts payable - trade $58,201 $61,594
Accounts payable - related parties 42,932 40,457
Accrued incentive management fees - related parties 92,891 41,342
Accrued salaries and wages 60,234 40,523
Accrued room tax and other 49,626 27,256
Distributions payable 225,000 90,000
Note payable - affiliate 292,697 271,632
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Total liabilities 821,581 572,804
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PARTNERS' EQUITY
General Partners (45 units issued and outstanding) 32,477 32,280
Limited Partners (4,455 units issued and
outstanding) 3,215,213 3,195,717
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Total Partners' equity 3,247,690 3,227,997
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TOTAL $ 4,069,271 $ 3,800,801
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CASA MUNRAS HOTEL PARTNERS, L.P.
(A Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
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REVENUES:
Room $1,009,249 $923,032 $2,007,203 $1,890,389
Food and beverage 196,286 195,019 475,593 468,384
Lease 21,941 18,343 64,869 62,593
Telephone 18,172 17,304 45,843 30,135
Other 6,678 6,544 12,060 10,525
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Total 1,252,326 1,160,242 2,605,568 2,462,026
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OPERATING EXPENSES:
Rooms 229,700 229,273 558,585 575,028
Food and beverage 152,051 153,448 396,354 401,894
Depreciation and amortization 81,833 75,000 248,833 225,000
Administrative and general 90,214 74,927 223,233 191,632
Marketing 63,992 54,209 168,623 164,934
Repairs and maintenance 51,825 43,819 143,067 132,647
Energy cost 40,852 47,207 127,835 127,165
Management fee 113,469 102,244 195,216 176,916
Partnership administration
and professional fees 4,292 3,452 39,157 37,506
Property taxes 18,945 18,513 48,961 47,177
Insurance 12,190 13,547 36,569 40,642
Interest 7,197 6,515 21,065 14,953
Telephone 7,928 5,791 18,377 10,849
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Total (including reimbursed
costs and payments for
services to related parties
of $138,770 and $115,977
and $368,467 and $366,383
for the three and nine months
ended September 30, 1995 and
1994 respectively) 874,488 827,945 2,225,875 2,146,343
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NET INCOME $ 377,838 $ 332,297 $ 379,693 $ 315,683
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CASA MUNRAS HOTEL PARTNERS, L.P.
(A Limited Partnership)
STATEMENTS OF OPERATIONS
FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
(Unaudited)
Three Months Ended Nine Months Ended
September 30, September 30,
1995 1994 1995 1994
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ALLOCATION OF NET INCOME:
General Partners $3,778 $3,323 $3,797 $3,157
Limited Partners (4,455 Limited
Partnership units outstanding) 374,060 328,974 375,896 312,526
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Total $377,838 $332,297 $379,693 $315,683
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DISTRIBUTION TO PARTNERS $225,000 $180,000 $360,000 $315,000
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PER UNIT INFORMATION
(based upon 4,500 total
Units outstanding):
Net income $83.96 $73.84 $84.38 $70.15
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Distribution $50.00 $40.00 $80.00 $70.00
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CASA MUNRAS HOTEL PARTNERS, L.P.
(A Limited Partnership)
STATEMENTS OF CASH FLOWS
FOR THE NINE MONTHS ENDED SEPTEMBER 30, 1995 AND 1994
(Unaudited)
1995 1994
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OPERATING ACITVITIES:
Net income $379,693 $315,683
Adjustments to reconcile net cash provided
by operating activities:
Depreciation and amortization 248,833 225,000
Change in assets and liabilities:
Accounts receivable (95,777) (36,179)
Food and beverage inventories (2,714) 2,095
Prepaid expenses 10,333 (12,316)
Account payable and accrued expenses 92,712 106,151
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Net cash provided by operating activities 633,080 600,434
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INVESTING ACTIVITIES:
Acquisition of property and equipment (22,888) (489,344)
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FINANCING ACTIVITIES:
Note Payable - affiliate 21,065 264,953
Distributions paid to Partners (225,000) (315,000)
Other assets - loan fee (10,000)
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Net cash used in financing activities (203,935) (60,047)
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NET INCREASE IN CASH 406,257 51,043
CASH AT BEGINNING OF PERIOD 287,907 386,243
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CASH AT END OF PERIOD $694,164 $437,286
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Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
Results of Operations for the Three and Nine Months Ended September 30, 1995
and 1994
Occupancy rates at the Registrant's hotel were 90% and 65%
versus 83% and 61% and average room rates were $82.13 and $74.65 versus $80.12
and $74.68, respectively, for the three and nine months ended September 30,
1995 as compared to 1994. The increase in occupancy factors is attributable to
increased pleasure travel during the 1995 summer tourist season as compared to
the similar 1994 period. Food and beverage revenues are primarily based upon
room occupancy factors, and as a result increased slightly for the two 1995
periods.
The Registrant's operating expenses are primarily based upon
occupancy of the hotel and were up from the previous comparable periods at
levels consistent with the occupancy increase. Significant areas of increased
expense have occurred in the administrative and general category due to added
bookkeeping costs; higher management fees, which are based on revenues and
operating profitability; and additional depreciation and amortization as a
result of the ongoing capital addition program.
Liquidity and Capital Resources
The Registrant's primary source of cash is from the operation
and leasing of the hotel facility. The Registrant's primary uses of cash are
to fund hotel operating expenses and renovations and to pay distributions to
Partners.
During the nine months ended September 30, 1995, the
Registrant generated $633,080 in net cash flow from operating activities. In
January 1995, the Registrant distributed $90,000 to Partners in respect of
earnings for the quarter ended December 31, 1994. In June 1995, the General
Partners declared a distribution to Partners of $135,000, which was paid in
July 1995, and in September 1995, the General Partners declared a distribution
to Partners of $225,000, which was paid in October 1995.
Acquisition of property and equipment during the nine months
ended September 30, 1995 totalled $22,888. It is estimated that approximately
$700,000 more will be expended in late 1995 and in 1996 to continue the
renovation of the hotel. Such renovations of property and equipment are
expected to be funded from cash provided by operations and borrowings as
described below. In September 1995, the Registrant obtained an unsecured
credit facility under which the Registrant may borrow up to $900,000 from a
bank. No amounts have been drawn under the credit facility as of September 30,
1995. Borrowings, if made, will be at an annual interest rate equal to the
bank's prime rate plus 1.5%, interest only payable monthly through October 1,
1996, at which time the outstanding principal plus interest are due. A loan
fee of
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1/2% of the loan commitment ($4,500) was paid to the bank in connection with
the establishment of the credit facility. The General Partners intend to seek
a commitment from the bank to allow the outstanding principal as of October 1,
1996, if any, to be repaid over a four year term. There can be no assurance,
however, that the bank will agree to such an extension. The Partnership
expects to borrow under the credit facility to pay off the $250,000 loan made
to the Partnership in March 1994 by one of the General Partners to fund prior
acquisitions of property and equipment and to finance the ongoing renovation of
the hotel.
The General Partners intend, to the extent cash is available, to continue
making cash distributions to the Partners at amounts approximating the
Registrant's net income.
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits:
Exhibit
Number Description
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10.4 Multiple Disbursement Note dated as of September 28, 1995 by and
between Casa Munras Hotel Partners, L.P. (formerly known as Western
Host Monterey Partners) and City National Bank.
27 Financial Data Schedule
(b) Reports on Form 8-K:
None.
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SIGNATURE
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.
CASA MUNRAS HOTEL PARTNERS, L.P.
By /s/ John F. Rothman
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John F. Rothman
General Partner
Dated: November 13, 1995
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EXHIBIT INDEX
Sequentially
Exhibit Numbered
Number Description Page
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10.4 Multiple Disbursement Note dated as of September
28, 1995 by and between Casa Munras Hotel
Partners, L.P. (formerly known as Western Host
Monterey Partners and City National Bank.
27 Financial Data Schedule