0000898430-95-001537.txt : 19950815 0000898430-95-001537.hdr.sgml : 19950815 ACCESSION NUMBER: 0000898430-95-001537 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19950630 FILED AS OF DATE: 19950814 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: PUBLIC STORAGE PROPERTIES LTD CENTRAL INDEX KEY: 0000202953 STANDARD INDUSTRIAL CLASSIFICATION: TRUCKING & COURIER SERVICES (NO AIR) [4210] IRS NUMBER: 953196921 STATE OF INCORPORATION: CA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-08667 FILM NUMBER: 95562094 BUSINESS ADDRESS: STREET 1: 600 N BRAND BLVD CITY: GLENDALE STATE: CA ZIP: 91203 BUSINESS PHONE: 8182448080 MAIL ADDRESS: STREET 1: 600 NORTH BRAND BLVD STREET 2: SUITE 300 CITY: GLENDALE STATE: CA ZIP: 91203 10-Q 1 FORM 10-Q PERIOD 06/30/95 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q [X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the period ended June 30, 1995 or [ ] 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 0-8667 ------ PUBLIC STORAGE PROPERTIES, LTD. -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) California 95-3196921 -------------------------------------------------------------------------------- (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification Number) 600 N. Brand Boulevard Glendale, California 91203 -------------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (818) 244-8080 -------------- 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 ----- ----- INDEX Page ---- PART I. FINANCIAL INFORMATION Condensed balance sheets at June 30, 1995 and December 31, 1994 2 Condensed statements of operations for the three and six months ended June 30, 1995 and 1994 3 Condensed statement of partners' deficit for the six months ended June 30, 1995 4 Condensed statements of cash flows for the six months ended June 30, 1995 and 1994 5 Notes to condensed financial statements 6-7 Management's discussion and analysis of financial condition and results of operations 8-9 PART II. OTHER INFORMATION 10 PUBLIC STORAGE PROPERTIES, LTD. CONDENSED BALANCE SHEETS
June 30, December 31, 1995 1994 ----------- ------------ ASSETS ------ Cash and cash equivalents $ 72,000 $ 162,000 Marketable securities of affiliate at market value (cost of $347,000) 654,000 574,000 Rent and other receivables 42,000 63,000 Real estate facilities at cost: Building, land improvements and equipment 7,353,000 7,149,000 Land 2,511,000 2,511,000 ----------- ----------- 9,864,000 9,660,000 Less accumulated depreciation (4,456,000) (4,288,000) ----------- ----------- 5,408,000 5,372,000 ----------- ----------- Other assets 231,000 247,000 ----------- ----------- Total assets $ 6,407,000 $ 6,418,000 =========== =========== LIABILITIES AND PARTNERS' DEFICIT --------------------------------- Accounts payable $ 108,000 $ 30,000 Deferred revenue 125,000 136,000 Notes payable 17,479,000 17,995,000 Partners' deficit: Limited partners' deficit, $500 per unit, 20,000 units authorized, issued and outstanding (8,674,000) (8,888,000) General partners' deficit (2,938,000) (3,082,000) Unrealized gain on marketable securities 307,000 227,000 ------------ ------------ Total partners' deficit (11,305,000) (11,743,000) ------------ ------------ Total liabilities and partners' deficit $ 6,407,000 $ 6,418,000 ============ ============
see accompanying notes. 2 PUBLIC STORAGE PROPERTIES, LTD. CONDENSED STATEMENT OF OPERATIONS (UNAUDITED)
Three Months Ended Six Months Ended -------------------- ------------------------ 1995 1994 1995 1994 -------- -------- ---------- ---------- REVENUE: Rental income $963,000 $902,000 $1,897,000 $1,778,000 Dividends and other income (including dividends from marketable securities of affiliate) 8,000 27,000 18,000 53,000 -------- -------- ---------- ---------- 971,000 929,000 1,915,000 1,831,000 -------- -------- ---------- ---------- COSTS AND EXPENSES: Costs of operations 219,000 220,000 457,000 427,000 Management fees paid to an affiliate 58,000 54,000 114,000 107,000 Depreciation and amortization 87,000 74,000 168,000 148,000 Administrative 13,000 35,000 47,000 50,000 Interest expense 383,000 435,000 771,000 874,000 -------- -------- ---------- ---------- 760,000 818,000 1,557,000 1,606,000 -------- -------- ---------- ---------- NET INCOME $211,000 $111,000 $ 358,000 $ 225,000 ======== ======== ========== ========== Limited partners' share of net income ($17.70 per unit in 1995 and $11.15 per unit in 1994) $ 354,000 $ 223,000 General partners' share of net income 4,000 2,000 ---------- ---------- $ 358,000 $ 225,000 ========== ==========
see accompanying notes. 3 PUBLIC STORAGE PROPERTIES, LTD. CONDENSED STATEMENT OF PARTNERS' DEFICIT (UNAUDITED)
Unrealized Gain on Total Limited General Marketable Partners Partners Partners Securities Deficit ------------- ------------- ---------- -------------- Balance at December 31, 1994 $(8,888,000) $(3,082,000) $227,000 $(11,743,000) Unrealized gain on marketable Securities - - 80,000 80,000 Net income 354,000 4,000 - 358,000 Equity transfer (140,000) 140,000 - - ----------- ----------- -------- ------------ Balance at June 30, 1995 $(8,674,000) $(2,938,000) $307,000 $(11,305,000) =========== =========== ======== ============
see accompanying notes. 4 PUBLIC STORAGE PROPERTIES, LTD. CONDENSED STATEMENTS OF CASH FLOWS (UNAUDITED)
Six Months Ended June 30, ------------------------ 1995 1994 --------- ----------- Cash flows from operating activities: Net income $ 358,000 $ 225,000 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 168,000 148,000 Decrease (increase) in rent and other receivables 21,000 (25,000) Decrease in prepaid loan fees 16,000 16,000 Increase in other assets - (9,000) Increase (decrease) in accounts payable 78,000 (15,000) Decrease in deferred revenue (11,000) (8,000) --------- ----------- Total adjustments 272,000 107,000 --------- ----------- Net cash provided by operating activities 630,000 332,000 --------- ----------- Cash flows from investing activities: Additions to real estate facilities (204,000) (34,000) --------- ----------- Net cash used in investing activities (204,000) (34,000) --------- ----------- Cash flows from financing activities: Proceeds from note payable - 3,000,000 Proceeds from note payable to affiliate - 1,250,000 Principal payment on note payable to affiliate - (4,350,000) Principal payments on note payable (516,000) (201,000) --------- ----------- Net cash used in financing activities (516,000) (301,000) --------- ----------- Net decrease in cash and cash equivalents (90,000) (3,000) Cash and cash equivalents at the beginning of the period 162,000 136,000 --------- ----------- Cash and cash equivalents at the end of the period $ 72,000 $ 133,000 ========= =========== SUPPLEMENTAL SCHEDULE OF NON-CASH INVESTING AND FINANCING ACTIVITIES: Increase in fair value of marketable securities $ (80,000) $ - ========= =========== Unrealized gain on marketable securities 80,000 - ========= ===========
see accompanying notes. 5 PUBLIC STORAGE PROPERTIES, LTD. NOTES TO CONDENSED FINANCIAL STATEMENTS (UNAUDITED) 1. The accompanying unaudited condensed financial statements have been prepared 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 condensed or omitted pursuant to such rules and regulations, although management believes that the disclosures contained herein are adequate to make the information presented not misleading. These unaudited condensed financial statements should be read in conjunction with the financial statements and related notes appearing in the Partnership's Form 10-K for the year ended December 31, 1994. 2. In the opinion of management, the accompanying unaudited condensed financial statements reflect all adjustments, consisting of only normal accruals, necessary to present fairly the Partnership's financial position at June 30, 1995, the results of its operations for the three and six months ended June 30, 1995 and 1994 and its cash flows for the six months then ended. 3. The results of operations for the three and six months ended June 30, 1995 are not necessarily indicative of the results expected for the full year. 4. Marketable securities at June 30, 1995 consist of 39,911 common shares of Storage Equities, Inc. ("SEI"), a publicly traded real estate investment trust, whose investment advisor is an affiliate of Public Storage, Inc. (a general partner of the Partnership). FASB Statement No. 115, "Accounting for Certain Investments in Debt and Equity Securities," requires marketable securities to be classified as trading or available for sale. The Partnership has designated its portfolio of marketable securities as available for sale. Accordingly, at June 30, 1995, the Partnership has recorded the marketable securities at fair value and, based upon the closing quoted price of the securities at June 30, 1995, recorded a corresponding unrealized gain totaling $307,000 as a credit to Partnership equity. 6 5. Substantially all of the Partnership's facilities were acquired prior to the time that it was customary to conduct environmental investigations in connection with property acquisitions. During the six month period ended June 30, 1995, the Partnership completed environmental assessments on its properties. Those assessments indicated that the Partnership's property sites do not have any significant environmental issues which would have a materially adverse effect on the Company's financial position. Included in administrative expenses on the statements of operations for six months ended June 30, 1995 is approximately $24,000 incurred in connection with the environmental assessments. 7 PUBLIC STORAGE PROPERTIES, LTD. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS RESULTS OF OPERATIONS --------------------- THREE AND SIX MONTHS ENDED JUNE 30, 1995 COMPARED TO THREE AND SIX MONTHS ENDED JUNE 30, 1994: The Partnership's net income for the six months ended June 30, 1995 was $358,000 compared to $225,000 for the six months ended June 30, 1994, representing an increase of $133,000, or 59%. The Partnership's net income for the three months ended June 30, 1995 was $211,000 compared to $111,000 for the three months ended June 30, 1994, representing an increase of $100,000, or 90%. These increases are primarily a result of increased rental income combined with decreased interest expense due to lower outstanding loan balances in 1995 compared to 1994. Rental income was $1,897,000 compared to $1,778,000 for the six months ended June 30, 1995 and 1994, respectively, representing an increase of $119,000. Rental income was $963,000 compared to $902,000 for the three months ended June 30, 1995 and 1994, respectively, representing an increase of $61,000. These increases are primarily attributable to increased occupancy levels and increased rental rates. The weighted average occupancy levels at the mini-warehouse facilities were 90% and 85% for the six months ended June 30, 1995 and 1994, respectively. Realized rent for the six months ended June 30, 1995 increased to $.69 per occupied square foot from $.68 per occupied square foot for the six months ended June 30, 1994. Cost of operations (including management fees paid to affiliate) increased $37,000 to $571,000 from $534,000 for the six months ended June 30, 1995 and 1994 respectively. This increase is mainly attributable to increases in payroll and management fees paid to an affiliate. Cost of operations (including management fees paid to affiliate) remained stable for the three months ended June 30, 1995 and 1994, respectively. Administrative expenses increased $3,000 for the six months ended June 30, 1995 compared to the same period in 1994 primarily as the result of cost incurred on environmental assessments on the Partnership's properties offset by legal costs incurred in 1994. Substantially all of the Partnership's facilities were acquired prior to the time that it was customary to conduct extensive environmental investigations in connection with the property acquisitions. During the first quarter of 1995, the Partnership commenced environmental assessments on its properties. The result of those assessments have been completed. 8 However, the Partnership is not presently aware of any significant environmental matters with respect to any of its properties which would have a materially adverse effect on the Company's financial position. LIQUIDITY AND CAPITAL RESOURCES ------------------------------- Cash generated from operations ($630,000 for the six months ended June 30, 1995) has been sufficient to meet all current obligations of the Partnership. At June 30, 1995 the Partnership held 39,911 shares of common stock (marketable securities) with a fair value totaling $654,000 (cost basis of $326,000 at March 31, 1995) in Storage Equities, Inc. ("SEI"), a publicly traded real estate investment trust, whose investment advisor is an affiliate of Public Storage, Inc. (a general partner of the Partnership). The Partnership recognized $9,000 in dividends for the three months ended June 30, 1995 and included this in other income on the condensed Statements of Operations. In the fourth quarter of 1990, quarterly distributions were discontinued to enable the Partnership to increase its cash reserves for principal payments that commenced in 1993. Future distribution rates may be adjusted to levels supported by operating cash flow after capital improvements and scheduled debt service. 9 PART II. OTHER INFORMATION ITEMS 1 through 4 are inapplicable. ITEM 5 Other Information ----------------- On August 7, 1995 PSI and B. Wayne Hughes, general partners of the Partnership, commenced a cash tender offer for up to 9,000 of the 20,000 outstanding Units in the Partnership at a purchase price of $171 per Unit (the "August 7, 1995 Offer to Purchase"). The August 7, 1995 Offer to purchase will expire on September 11, 1995, unless extended. ITEM 6 Exhibits and Reports on Form 8-K -------------------------------- (a) The following Exhibit is included herein: (27) Financial Data Schedule (b) Form 8 - K None. 10 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. DATED: August 11, 1995 PUBLIC STORAGE PROPERTIES, LTD. BY: Public Storage, Inc. General Partner BY: /s/ Ronald L. Havner, Jr. ---------------------------- Ronald L. Havner, Jr. Vice President and Chief Financial Officer (principal accounting and financial officer) 11 EX-27 2 FINANCIAL DATA SCHEDULE
5 6-MOS DEC-31-1995 JUN-30-1995 72,000 654,000 42,000 0 0 768,000 9,864,000 (4,456,000) 6,407,000 233,000 17,479,000 0 0 0 (11,612,000) 6,407,000 0 1,915,000 0 739,000 47,000 0 771,000 358,000 0 358,000 0 0 0 358,000 17.70 0