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: September 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 of I.R.S. Employer Identification No.)
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 September 30, 2003
(UNAUDITED)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 300,698
Accounts Receivable, no allowance deemed necessary 98,658
Inventory-In Process 350,133
Deferred crop costs 39,594
Accrued Interest Receivable 12,335
Current portion of notes receivable 14,666
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Total Current Assets 816,084
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NOTES RECEIVABLE-LONG TERM 477,588
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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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$ 2,034,259
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LIABILITIES AND PARTNERS' EQUITY
CURRENT LIABILITIES
Accounts payable and accrued liabilities $ 63,764
Current portion of long-term debt 24,000
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Total Current Liabilities 87,764
LONG-TERM DEBT, less current portion 252,000
PARTNERS' EQUITY 1,694,495
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$ 2,034,259
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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 Nine Months Ended
September 30, September 30,
2003 2002 2003 2002
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REVENUES
Interest Income $ 8,584 $ 16,435 $ 27,912 $ 16,435
Gain on sale of almond orchards 180,219
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$ 8,584 16,435 27,912 196,654
EXPENSES --
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NET INCOME $ 8,584 $ 16,435 $ 27,912 $196,654
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NET INCOME PER LIMITED PARTNERSHIP UNIT $ 0.71 $ 1.36 $ 2.31 $ 16.28
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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
Nine Months Ended
September 30,
2003 2002
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CASH FLOWS FROM OPERATING ACTIVITIES
Net Income $ 27,912 $ 196,654
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 (6,987)
Deferred crop costs (343,296) (521,108)
Advances fro farm costs 1,500 5,400
Accounts payable and accrued liabilities (4,738) 171,460
Payable to related parties (3,636)
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Net cash from operating activities (59,395) (37,513)
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CASH FLOW FROM INVESTING ACTIVITIES
Payments received on notes receivable 9,082 5,663
Proceeds from sale of almond orchards 112,515
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Net cash from investing activities 9,082 118,178
CASH FLOW FROM FINANCING ACTIVITIES
Payments on long-term debt (12,000) (12,000)
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NET CHANGE IN CASH (62,313) 68,665
CASH, beginning of period 363,011 111,300
CASH, end of period $ 300,698 $ 179,965
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SUPPLEMENTAL CASH-FLOW INFORMATION
Non-cash investing activities
Notes receivable from sale of almond orchards $ 0 $ 507,000
See accompanying notes.
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 third
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 the completion of the harvest. 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. In spite of the projected
large almond crop, almond prices have stabilized and started to increase. At
this time, there has been no change in the current value of almond orchards. The
market for almond orchards still has many sellers and few buyers, which
continues to depress real estate values.
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