1
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 June 30, 1995
[ ] 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: 0-11910
CABLE TV FUND 11-A, LTD.
Exact name of registrant as specified in charter
Colorado 84-0892990
State of organization I.R.S. employer I.D. #
9697 East Mineral Avenue, P.O. Box 3309, Englewood, Colorado 80155-3309
Address of principal executive office
(303) 792-3111
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 _____
2
CABLE TV FUND 11-A, LTD.
(A Limited Partnership)
UNAUDITED BALANCE SHEETS
June 30, December 31,
ASSETS 1995 1994
------ ------------ ------------
INVESTMENT IN CABLE TELEVISION JOINT VENTURE $ 1,257,733 $ 1,231,800
============ ============
LIABILITIES AND PARTNERS' CAPITAL (DEFICIT)
-------------------------------------------
LIABILITIES:
Accounts payable- General Partner $ 10,781 $ 10,781
------------ ------------
PARTNERS' CAPITAL (DEFICIT):
General Partner-
Contributed capital 1,000 1,000
Distributions (11,079,511) (11,079,511)
Accumulated earnings 10,912,755 10,912,496
------------ ------------
(165,756) (166,015)
------------ ------------
Limited Partners-
Net contributed capital
(46,725 units outstanding at
June 30, 1995 and December 31, 1994) 19,516,170 19,516,170
Distributions (56,599,297) (56,599,297)
Accumulated earnings 38,495,835 38,470,161
------------ ------------
1,412,708 1,387,034
------------ ------------
Total liabilities and partners'
capital (deficit) $ 1,257,733 $ 1,231,800
============ ============
The accompanying notes to unaudited financial statements
are an integral part of these unaudited balance sheets.
2
3
CABLE TV FUND 11-A, LTD.
(A Limited Partnership)
UNAUDITED STATEMENTS OF OPERATIONS
For the Three Months Ended For the Six Months Ended
June 30, June 30,
-------------------------- ------------------------
1995 1994 1995 1994
------- ------- ------- -------
EQUITY IN NET INCOME
OF CABLE TELEVISION
JOINT VENTURE $17,466 $16,655 $25,933 $35,037
------- ------- ------- -------
NET INCOME $17,466 $16,655 $25,933 $35,037
======= ======= ======= =======
ALLOCATION OF NET
INCOME:
General Partner $ 174 $ 166 $ 259 $ 350
======= ======= ======= =======
Limited Partners $17,292 $16,489 $25,674 $34,687
======= ======= ======= =======
NET INCOME PER LIMITED
PARTNERSHIP UNIT $ .37 $ .34 $ .55 $ .74
======= ======= ======= =======
WEIGHTED AVERAGE NUMBER
OF LIMITED PARTNERSHIP
UNITS OUTSTANDING 46,725 46,725 46,725 46,725
======= ======= ======= =======
The accompanying notes to unaudited financial statements
are an integral part of these unaudited statements.
3
4
CABLE TV FUND 11-A, LTD.
(A Limited Partnership)
UNAUDITED STATEMENTS OF CASH FLOWS
For the Six Months Ended
June 30,
------------------------------
1995 1994
--------- ---------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 25,933 $ 35,037
Adjustments to reconcile net income to
net cash used in operating activities:
Equity in net income of cable
television joint venture (25,933) (35,037)
-------- --------
Net cash used in operating activities -- --
-------- --------
Cash, beginning of period -- --
-------- --------
Cash, end of period $ -- $ --
======== ========
SUPPLEMENTAL CASH FLOW DISCLOSURE:
Interest paid $ -- $ --
======== ========
The accompanying notes to unaudited financial statements
are an integral part of these unaudited statements.
4
5
CABLE TV FUND 11-A, 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 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 11-A, Ltd.
(the "Partnership") at June 30, 1995 and December 31, 1994 and its Statements
of Operations for the three and six month periods ended June 30, 1995 and 1994,
and its Statements of Cash Flows for the six month periods ended June 30, 1995
and 1994. Results of operations for these periods are not necessarily
indicative of results to be expected for the full year.
(2) Jones Intercable, Inc. (the "General Partner"), a publicly held Colorado
corporation, manages the Partnership and Cable TV Joint Fund 11 (the
"Venture"), in which the Partnership holds an approximate 18 percent interest,
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. The Partnership owns no properties directly, and it holds an
interest in a cable television system only through its investment in the
Venture. Management fees paid by the Venture and attributable to the
Partnership for the three and six month periods ended June 30, 1995 (reflecting
the Partnership's approximate 18 percent interest in the Venture) were $8,205
and $15,982, respectively, as compared to $7,502 and $14,892, respectively, for
the similar 1994 periods.
The Venture reimburses the General Partner for certain allocated overhead
and administrative expenses. These expenses represent the salaries and related
benefits paid to 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. Allocations of personnel costs are primarily based on 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 Partnership'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 to the General Partner paid by the Venture and
attributable to the Partnership for allocated overhead and administrative
expenses for the three and six month periods ending June 30, 1995 (reflecting
the Partnership's approximate 18 percent interest in the Venture) were $11,437
and $24,854, respectively, as compared to $12,052 and $24,633, respectively,
for the similar 1994 periods.
(3) The Manitowoc, Wisconsin system (the "Manitowoc System") was submitted
for public bid in the second quarter of 1995. The bidding closed on July 7,
1995, with the General Partner tendering the only bid. The price bid by the
General Partner was $15,735,667, which reflects the average of three separate,
independent appraisals of the fair market value of the Manitowoc System. The
General Partner's bid for the Manitowoc System has been accepted, and a
purchase and sale agreement is being negotiated. Closing of the sale is
subject to (i) the negotiation of a definitive purchase and sale agreement,
(ii) approval by the holders of a majority of the limited partnership interests
in each of the four partnerships that comprise the Venture in votes to be
conducted in the autumn of 1995 and (iii) the successful renewal and transfer
of the system's franchise.
The franchise renewal negotiations are continuing, and the General
Partner expects that negotiations will be completed in 1995. The city has
agreed that the term of the renewal franchise will be 12 years and that the
applicable franchise fee will be 5 percent. The Venture paid the city
$1,850,000, which will be returned to the Venture, with interest, in the event
that the city does not renew the franchise. If the franchise is renewed, the
$1,850,000 will be accounted for as franchise costs.
5
6
(4) Financial information regarding the Venture is presented below.
UNAUDITED BALANCE SHEETS
June 30, December 31,
1995 1994
--------------- --------------
ASSETS
------
Cash and accounts receivable $ 2,578,004 $ 2,521,713
Investment in cable television properties 2,612,053 2,724,042
Other assets 1,901,490 1,853,355
------------- -------------
Total assets $ 7,091,547 $ 7,099,110
============= =============
LIABILITIES AND PARTNERS' CAPITAL
---------------------------------
Debt $ 15,823 $ 26,385
Payables and accrued liabilities 335,548 474,880
Partners' contributed capital 45,000,000 45,000,000
Distributions (118,914,493) (118,914,493)
Accumulated earnings 80,654,669 80,512,338
------------- -------------
Total liabilities and partners' capital $ 7,091,547 $ 7,099,110
============= =============
6
7
UNAUDITED STATEMENTS OF OPERATIONS
For the Three Months Ended For the Six Months Ended
June 30, June 30,
-------------------------- -------------------------
1995 1994 1995 1994
---------- --------- ----------- ----------
Revenues $ 900,622 $ 823,499 $ 1,754,350 $1,634,657
Operating expenses (590,962) (501,203) (1,174,698) (982,690)
Management fees and allocated overhead from
Jones Intercable, Inc. (107,805) (107,325) (224,127) (216,930)
Depreciation and amortization (139,564) (129,566) (279,129) (260,056)
--------- --------- ----------- ----------
Operating income 62,291 85,405 76,396 174,981
Interest expense (2,417) (6,169) (8,701) (10,466)
Interest income 35,775 20,087 73,821 35,562
Other, net 208 (7,909) 815 (7,776)
--------- --------- ----------- ----------
Net income $ 95,857 $ 91,414 $ 142,331 $ 192,301
========= ========= =========== ==========
Management fees paid to Jones Intercable, Inc. by the Venture totaled
$45,032 and $87,718 for the three and six months ended June 30, 1995,
respectively, and $41,175 and $81,733 for the three and six month periods ended
June 30, 1994, respectively. Reimbursements for general and administrative
expenses paid to Jones Intercable, Inc. by the Venture totaled $62,773 and
$136,409 for the three and six month periods ended June 30, 1995, respectively,
and $66,150 and $135,197 for the three and six month periods ended June 30,
1994, respectively.
7
8
CABLE TV FUND 11-A, LTD.
(A Limited Partnership)
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
FINANCIAL CONDITION
The Partnership owns an approximate 18 percent interest in Cable TV Joint
Fund 11 (the "Venture"). The investment in this cable television joint venture
is accounted for under the equity method. When compared to the December 31,
1994 balance, this investment has increased by $25,933, from $1,231,800 at
December 31, 1994 to $1,257,733 at June 30, 1995. This increase represents the
Partnership's proportionate share of net income generated by the Venture during
the first six months of 1995.
The Manitowoc System was submitted for public bid in the second quarter
of 1995. The bidding closed on July 7, 1995, with the General Partner
tendering the only bid. The price bid by the General Partner was $15,735,667,
which reflects the average of three separate, independent appraisals of the
fair market value of the Manitowoc System. The General Partner's bid for the
Manitowoc System has been accepted, and a purchase and sale agreement is being
negotiated. Closing of the sale is subject to (i) the negotiation of a
definitive purchase and sale agreement, (ii) approval by the holders of a
majority of the limited partnership interests in each of the four partnerships
that comprise the Venture in votes to be conducted in the autumn of 1995 and
(iii) the successful renewal and transfer of the system's franchise.
The franchise renewal negotiations are continuing, and the General
Partner expects that negotiations will be completed in 1995. The city has
agreed that the term of the renewal franchise will be 12 years and that the
applicable franchise fee will be 5 percent. The Venture paid the city
$1,850,000, which will be returned to the Venture, with interest, in the event
that the city does not renew the franchise. If the franchise is renewed, the
$1,850,000 will be accounted for as franchise costs.
For the six months ended June 30, 1995, the Venture generated operating
income before depreciation and amortization of $355,525 and incurred interest
expense totaling $8,701, leaving $346,824 to fund capital expenditures and
non-operating costs. During the first six months of 1995, the Venture expended
approximately $140,000 for capital additions in the Manitowoc System. These
capital additions were for various enhancements to maintain the value of the
system and were funded from cash generated from operations. Anticipated
capital expenditures for the remainder of 1995 are approximately $133,000.
These expenditures will be for various enhancements to maintain the value of
the system. It is expected that these capital expenditures will be funded from
cash on hand and cash generated from operations.
The Venture had no bank debt outstanding at June 30, 1995.
The Venture has sufficient liquidity and capital resources, including
cash on hand and its ability to generate cash from operations, to meet its
anticipated needs.
RESULTS OF OPERATIONS
All of the Partnership's operations are generated through its
approximate 18 percent interest in the Venture. Revenues of the Venture
totaled $900,622 for the three month period ended June 30, 1995 as compared to
$823,499 for the comparable 1994 period, an increase of $77,123, or
approximately 9 percent. Revenues of the Venture totaled $1,754,350 for the six
months ended June 30, 1995 as compared to $1,634,657 for the comparable 1994
period, an increase of $119,693, or approximately 7 percent. An increase in
the subscriber base primarily accounted for the increase in revenues for the
three and six month periods ended June 30, 1995. The number of basic
subscribers increased 1,000, or approximately 10 percent, from 10,123 at June
30, 1994 to 11,123 at June 30, 1995. The number of premium subscribers
increased 1,734, or approximately 31 percent, from 5,537 at June 30, 1994 to
7,271 at June 30, 1995. No other individual factor contributed significantly
to the increase in revenues.
Operating expenses consist primarily of costs associated with the
administration of the Partnership'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 consumer marketing expenses.
8
9
Operating expenses in the Manitowoc system totaled $590,962 for the three
month period ended June 30, 1995 as compared to $501,203 for the comparable
1994 period, an increase of $89,759, or approximately 18 percent. Operating
expenses in the Manitowoc system totaled $1,174,698 for the six months ended
June 30, 1995 as compared to $982,690 for the comparable 1994 period, an
increase of $192,008, or approximately 20 percent. Operating expenses
represented 66 percent and 67 percent, respectively, of revenues for the three
and six months periods of 1995 and 61 percent and 60 percent, respectively, for
the comparable 1994 periods. The increases in operating expenses for the three
and six month periods were due to increases in programming fees, which were
due, in part, to the increase in the subscriber base and increases in property
taxes. No other individual factor significantly affected the increases in
operating expenses.
Management fees and allocated overhead from the General Partner totaled
$107,805 for the three month period ended June 30, 1995 as compared to $107,325
for the comparable 1994 period, an increase of $480, or less than 1 percent.
Management fees and allocated overhead from the General Partner totaled
$224,127 for the six months ended June 30, 1995 as compared to $216,930 for the
comparable 1994 period, an increase of $7,197, or approximately 3 percent. The
increases for the three and six month periods were due to the increase in
revenues, upon which such fees and allocations are based.
Depreciation and amortization expense totaled $139,564 for the three
month period ended June 30, 1995 as compared to $129,566 for the comparable
1994 period, an increase of $9,998, or approximately 8 percent. Depreciation
and amortization expense totaled $279,129 for the six months ended June 30,
1995 as compared to $260,056 for the comparable 1994 period, an increase of
$19,073, or approximately 7 percent. The increases for the three and six month
periods were due to capital additions in 1994.
Operating income totaled $62,291 for the three month period ended June
30, 1995 as compared to $85,405 for the comparable 1994 period, a decrease of
$23,114, or approximately 27 percent. Operating income totaled $76,396 for the
six months ended June 30, 1995 as compared to $174,981 for the comparable 1994
period, a decrease of $98,585, or approximately 56 percent. The decreases for
the three and six month periods were due to the increases in operating
expenses, management fees and allocated overhead from the General Partner and
depreciation and amortization expense exceeding the increases in revenues.
Operating income before depreciation and amortization totaled $201,855 for the
three month period ended June 30, 1995 as compared to $214,971 for the
comparable 1994 period, a decrease of $13,116, or approximately 6 percent.
Operating income before depreciation and amortization totaled $355,525 for the
six months ended June 30, 1995 as compared to $435,037 for the comparable 1994
period, a decrease of $79,512, or approximately 18 percent. The decreases for
both periods were due to the increases in operating expenses and management
fees and allocated overhead from the General Partner exceeding the increase in
revenues.
Interest expense for the Venture totaled $2,417 for the three month
period ended June 30, 1995 as compared to $6,169 for the comparable 1994
period, a decrease of $3,752, or approximately 61 percent. Interest expense
for the Venture totaled $8,701 for the six months ended June 30, 1995 as
compared to $10,466 for the comparable 1994 period, a decrease of $1,765, or
approximately 17 percent. The decreases for the three and six month periods
were due to lower outstanding balances on capital lease obligations. Net
income of the Venture totaled $95,857 for the three month period ended June 30,
1995 as compared to $91,414 for the comparable 1994 period, an increase of
$4,443, or approximately 5 percent. The increase was due to the decrease in
interest expense. Net income of the Venture totaled $142,331 for the six
months ended June 30, 1995 as compared to $192,301 for the comparable 1994
period, a decrease of $49,970, or approximately 26 percent. The decrease was
due primarily to the decrease in operating income.
9
10
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
10
11
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 11-A, LTD.
BY: JONES INTERCABLE, INC.
General Partner
By: /S/ Kevin P. Coyle
-----------------------------
Kevin P. Coyle
Group Vice President/Finance
(Principal Financial Officer)
Dated: August 14, 1995
11
12
EXHIBIT INDEX
Exhibit No. Exhibit Description Page
----------- ------------------- ----
27 Financial Data Schedule