SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-QSB
Quarterly Report Under Section 13 or 15(d)
of the Securities Exchange Act of 1954
For Quarter Ended: June 30, 2003 Commission File Number: 33-10196
(Exact name of registrant as specified in its charter)
California Almond Investors I
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A California Limited Partnership
California 94-3021790
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(State or other jurisdiction I.R.S. Employer Identification No.)
of incorporation or organization
2210 Northpoint Parkway, Santa Rosa, CA 95407
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(Address of principal executive offices) (Zip Code)
(707) 579-3742
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(Registrant's telephone number, including area code)
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(Former name, former address and former fiscal year, if changed since last
report.)
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.
[x] Yes [ ] No
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements.
See following pages.
See accompanying notes.
CALIFORNIA ALMOND INVESTORS I
(A CALIFORNIA LIMITED PARTNERSHIP)
BALANCE SHEET June 30, 2003
(UNAUDITED)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $242,593
Accounts Receivable, no allowance deemed necessary 98,658
Inventory-In Process 310,973
Deferred crop costs 39,594
Advances for farm costs 16,926
Accrued Interest Receivable 18,027
Current portion of notes receivable 8,004
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Total Current Assets 734,774
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NOTES RECEIVABLE-LONG TERM 490,001
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PROPERTY AND EQUIPMENT
Land 718,609
Orchards 1,418,254
Equipment 754,871
Buildings 38,913
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2,930,647
Less accumulated depreciation (2,190,060)
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740,587
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$1,965,362
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LIABILITIES AND PARTNERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities $ 3,450
Current portion of long-term debt 24,000
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Total Current Liabilities 27,450
LONG-TERM DEBT, less current portion 252,000
PARTNERS' EQUITY 1,685,912
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$1,965,362
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The financial statements, in the opinion of management, reflect all adjustments
necessary to fairly state the financial position and the results of operations.
These results are not necessarily to be considered indicative of the results for
the entire year.
See accompanying notes.
CALIFORNIA ALMOND INVESTORS I
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENT OF INCOME
UNAUDITED
Three Months Ended Six Months Ended
June 30, June 30,
2003 2002 2003 2002
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REVENUES
Interest Income $ 10,176 $ $ 19,328 $ --
Gain on sale of almond orchards 57,522 180,219
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$ 10,176 57,522 19,328 180.219
EXPENSES --
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NET INCOME $ 10,176 $ 57,522 $ 19,328 $180,219
======== ======== ======== ========
NET INCOME PER LIMITED PARTNERSHIP
UNIT $ 0.84 $ 4.76 $ 1.60 $ 14.92
======== ======== ======== ========
NUMBER OF PARTNERSHIP UNITS 12,079 12,079 12,079 12,079
See accompanying notes.
CALIFORNIA ALMOND INVESTORS I
(A CALIFORNIA LIMITED PARTNERSHIP)
STATEMENT OF ICASH FLOWS
UNAUDITED
Six Months Ended
June 30,
2003 2002
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CASH FLOWS FROM OPERATING ACTIVITIES
Net Income $ 19,328 $ 180,219
Adjustment to reconcile net income to net
cash from operating activities
Gain on sale of almond orchards 180,219)
Changes In:
Accounts receivable 269,850 290,300
Interest receivable (12,679)
Deferred crop costs (304,135) (301,137)
Advances fro farm costs (15,426) 5,400
Accounts payable and accrued liabilities (65,052) 2,701
Payable to related parties (3,636)
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Net cash from operating activities (111,750) (2,736)
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CASH FLOW FROM INVESTING ACTIVITIES
Payments received on notes receivable 3,331
Proceeds from sale of almond orchards 112,515
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Net cash from investing activities 3,331 112,515
CASH FLOW FROM FINANCING ACTIVITIES
Payments on long-term debt (12,000) (12,000)
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NET CHANGE IN CASH (120,419) 97,779
CASH, beginning of period 363,011 111,300
CASH, end of period $ 242,592 $ 209,079
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SUPPLEMENTAL CASH-FLOW INFORMATION
Non-cash investing activities
Notes receivable from sale of almond orchards $ $ 507,000
PART I-FINANCIAL INFORMATION
NOTES TO FINANCIAL STATEMENTS
NOTE 1 - BASIS OF PRESENTATION
The financial statements included herein have been prepared by the Partnership,
without audit, pursuant to the rules and regulations of the Securities and
Exchange Commission. Certain information and footnote disclosures normally
included in financial statements prepared in accordance with generally accepted
accounting principles have been omitted pursuant to such rules and regulations.
It is believed, however, that the disclosures are adequate to make the
information presented not misleading. These financial statements should be read
in conjunction with the Partnership's December 31, 2002, audited financial
statements and notes thereto.
NOTE 2 - INTEREST INCOME
During 2002, the Partnership sold three ranches due to low production. The
Partnership financed the three sales through long-term mortgage notes, with
interest ranging from 6% to 7.5%. Interest income is recognized as earned, as it
does not relate to the current year farming operations.
PART I-FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Introduction
In the ordinary course of business, the Partnership has made a number
of estimates and assumptions relating to the reporting of results of operations
and financial condition in the preparation of its financial statements in
conformity with accounting principles generally accepted in the United States of
America. Actual results could differ significantly from those estimates under
different assumptions and conditions. The Partnership believes the following
discussion addresses the most critical accounting policies, which are those that
are most important to the portrayal of the Partnership's financial condition and
results. The Partnership re-evaluates these significant factors as necessary and
makes adjustments where facts and circumstances dictate.
Historically, actual results have not significantly deviated from those
determined using the necessary estimates inherent in the preparation of
financial statements. Estimates and assumptions include, but are not limited to:
estimated price per pound, useable lives of the orchards and related assets,
collectibility of receivables, and the deferral of certain crop costs. These
accounting policies are applied consistently for all years presented.
Information about the impact on our operating results is included in the
footnotes to our consolidated financial statements. "
Liquidity and Capital Resources
The partnership generally receives payments from crop sales in
installments over the twelve months following harvest. The partnership retained
sufficient cash proceeds from the 2002 crop and has secured sufficient
additional crop financing necessary to sustain production of the 2003 crop. The
portion of the additional financing expected for the 2003 crop, if needed, will
be supplied by the almond processor. This practice is common to the industry
since final cash receipts for any crop year may extend beyond twelve months from
the harvest. The General Partner believes that these sources provide adequate
capital for the operating needs of the Partnership in 2003.
Results of Operations
The Partnership continued to operate at a break-even rate in the second
quarter 2003. This result is not indicative of the results for the entire fiscal
year, due to the seasonal nature of the almond growing business. Almonds are
harvested in August through October and the crop revenues and expenses are
recognized at that time. Since the partnership's crop care has not been
completed for this growing season, it is not possible to say if cultural costs
will be higher or lower than last year's costs. At this time though, it seems
that cultural costs will be substantially the same as last year.
Future Property Sales
The California Almond Industry is currently going through a period in
which supply exceeds demand. In the last few years, almond production has
increased more rapidly than the markets have expanded. This has resulted in
lower than normal prices for almonds and depressed prices for almond properties.
This trend is expected to continue, until supply and demand can be brought into
balance. At this time there is no way to know when this will be.
Because of the current condition of the almond industry and the aging
of the almond trees on the Partnership properties, the General Partner has
decided to put the three remaining properties up for sale. It is intended that
the properties will be listed for sale after the harvest of the 2003 crop so
that the Partnership can retain the crop income. After the sale of the last
property, the liquidation of the Partnership will start. At this time there is
no way to estimate the time of the final liquidation, due to the delayed payment
for the 2003 crop and the notes the Partnership holds on the three properties
that were sold in 2002.
Almond Market
The Objective Forecast for the 2003 almond crop is one billion pounds.
The final 2002 crop was one billion, 82 million pounds. If this estimate is
correct, almond prices for the 2003 crop could be equal to or lower then prices
received for the 2002 crop. This continues to have a depressing effect on the
value of almond orchards in California, and has produced an almond orchard
market with few buyers and many sellers.
Item 3. Controls and Procedures
Within the 90 day period prior to the date of this report, the
Partnership carried out an evaluation, under the supervision of the General
Partner and the General Partner's management, including its Chief Executive
Officer and Chief Financial Officer, of the effectiveness of the design and
operation of the Partnership's disclosure controls and procedures pursuant to
Exchange Act Rule 15d-14 ( c ). Based *on that evaluation, the General Partner
concluded that the Partnership's disclosure controls and procedures are
effective in a timely manner to alert them to material information relating to
the Partnership which is required to be included in the Partnership's periodic
Securities and Exchange Commission filings. There have been no significant
changes in the Partnership's internal controls or in other factors that could
significantly affect these controls subsequent to the evaluation date.
PART II
Item No.
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1. Material developments in connection with legal proceeding - not
applicable
2. Material modification of rights of registrant's securities - not
applicable
3. Defaults on senior securities - not applicable
4. Submission of matters to a vote of security holders - not applicable
5. Other events of importance - not applicable
6. Exhibits and 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.
CALIFORNIA ALMOND INVESTORS I
A California limited partnership
By: Vintech Almond Advisers, Inc.
A California corporation,
Managing General Partner
By:
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David A. Bade
President