-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, N8NcruNvcg7mNYM3aTI7mh89rSU/PIVV+mBw6dOAQt3r3S86cwi1O7fbvlKbBemr WBlHqHn6M4MmDp2HIclVQA== 0000732288-96-000007.txt : 19960701 0000732288-96-000007.hdr.sgml : 19960701 ACCESSION NUMBER: 0000732288-96-000007 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960514 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: DELPHI FILM ASSOCIATES III CENTRAL INDEX KEY: 0000732288 STANDARD INDUSTRIAL CLASSIFICATION: 7812 IRS NUMBER: 133177344 STATE OF INCORPORATION: NY FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-13158 FILM NUMBER: 96562615 BUSINESS ADDRESS: STREET 1: 666 THIRD AVE CITY: NEW YORK STATE: NY ZIP: 10017 BUSINESS PHONE: 2129839040 MAIL ADDRESS: STREET 1: 666 THIRD AVE CITY: NEW YORK STATE: NY ZIP: 10017 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q X Quarterly Report Under Section 13 or 15(d) of the Securities Exchange Act of 1934 For the Quarter Ended March 31, 1996 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 0-13158 DELPHI FILM ASSOCIATES III (Exact name of registrant as specified in its charter) New York 13-3177344 (State or other jurisdiction of (IRS Employer incorporation or organization) Identification No.) 666 Third Avenue, New York, New York 10017 (Address of principal executive offices) (Zip Code) (212) 983-9040 (Registrant's telephone number, including area code) 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____ DELPHI FILM ASSOCIATES III (A New York Limited Partnership) BALANCE SHEETS (000's Omitted) Unaudited
March December 31, 31, 1996 1995 ASSETS Cash $ $ 164 155 Short-Term Investments 1,118 986 Receivable from Columbia-Delphi III Productions 678 640 Receivable from Tri-Star-Delphi III Productions 463 503 Interest in Motion Picture Venture-Columbia- Delphi III Productions 118 132 Interest in Motion Picture Venture-Tri-Star- Delphi III Productions 436 456 Total $ $ Assets 2,977 2,872 LIABILITIES AND PARTNERS' CAPITAL Liabilities: Accrued Expenses and Accounts $ $ Payable 34 55 Total Liabilities 34 55 Partners' Capital (Note 2): General Partner 71 70 Limited Partners 2,872 2,747 Total Partners' Capital 2,943 2,817 Total Liabilities and Partners' $ $ Capital 2,977 2,872 See accompanying notes to the financial statements.
DELPHI FILM ASSOCIATES III (A New York Limited Partnership) STATEMENTS OF OPERATIONS (000's Omitted, except net profit per unit) Unaudited
For the Three Months Ended March 31, 1996 1995 Interest Income $ $ 13 16 Expenses: Operating Expenses 63 61 63 61 Loss before Share of Profit in Motion Picture (50) (45) Ventures Share of Profit in Motion Picture Venture--Columbia- Delphi III Productions 99 18 Share of Profit in Motion Picture Venture--Tri-Star- Delphi III Productions 77 181 Net Profit $ $ 126 154 Net Profit Per Unit of Limited Partnership Interest (9,702 Units) $ $ 13 16 See accompanying notes to the financial statements.
DELPHI FILM ASSOCIATES III (A New York Limited Partnership) STATEMENTS OF CASH FLOWS (000's Omitted) Unaudited
For the Three Months Ended March 31, 1996 1995 Cash Flow From Operating Activities: Net Profit $ $ 126 154 Adjustments to reconcile Net Profit to net cash provided by operating activities: Share of Profit in Motion Picture Ventures (176) (199) Distributions from Joint 210 218 Ventures Changes in Assets and Liabilities: Decrease (Increase) in Receivables from Joint Ventures, net 2 (30) Decrease in Accrued Expenses and Accounts Payable (21) (13) Net Cash Provided by Operating Activities 141 130 Cash Flow From Investing Activities: Purchases of Short-Term (619) (631) Investments Redemptions of Short-Term Investments 487 484 Net Cash Used by Investing Activities (132) (147) Increase (Decrease) In Cash 9 (17) Cash at beginning of period 155 132 Cash at end of period $ $ 164 115 See accompanying notes to the financial statements.
DELPHI FILM ASSOCIATES III (A New York Limited Partnership) NOTES TO FINANCIAL STATEMENTS Unaudited 1. Basis of Presentation The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information. They do not include all information and notes required by generally accepted accounting principles for complete financial statements. There has been no material change in the information disclosed in the notes to financial statements of the Partnership included in the Annual Report on Form 10-K for the year ended December 31, 1995. The information furnished includes all adjustments which are, in the opinion of management, necessary to present fairly the financial position of the Partnership as of March 31, 1996 and the results of operations and cash flows for the periods ended March 31, 1996 and 1995. Results of operations for the period ended March 31, 1996 are not necessarily indicative of the results that may be expected for the entire fiscal year. 2. Current Operations As of March 31, 1996, all thirty-four films in which the Partnership has an interest had been released. All of these films have completed their theatrical release and are being distributed in various ancillary markets. As of March 31 1996, the Partnership received in the aggregate approximately $531,000 and $1,503,000 from the Columbia Joint Venture and the Tri-Star Joint Venture, respectively, which represents accrued distribution fees paid with respect to the Distribution Fee Reduction Payments. These payments are net of amounts withheld by each Distributor for the recoupment of the Advances. Since these Distribution Fee Reduction Payments were not sufficient to enable either Joint Venture to recoup amounts spent by the respective Joint Venture for the production of films and the acquisition of interests in films (excluding amounts spent for payments in the nature of interest) (the "Expenditures"), each Distributor is required to pay to each Joint Venture an amount equal to all subsequent distribution fees earned by it from the distribution of films on behalf of that Joint Venture up to that Joint Venture's unrecouped Expenditures. If the Joint Ventures are able to recoup their Expenditures, each of the Distributors would be entitled to recoup these payments, with interest, from amounts thereafter otherwise payable to the Partnership. Based on the anticipated performance of the Partnership's films, each Distributor is required to continue making Distribution Fee Reduction Payments with respect to its films. Accordingly, the Partnership's share of distribution fees earned and expected to be earned by the Distributors as of March 31, 1996 of approximately $45,000 and $358,000 have been accrued by the Partnership as a receivable from the Columbia Joint Venture and the Tri-Star Joint Venture, respectively. For the purpose of computing the net profit per unit, the net profit for the period is allocated 99% to the limited partners and 1% to the General Partner. 3. Additional Information Additional information, including the audited year end 1995 Financial Statements and the Summary of Significant Accounting Policies, is included in the Partnership's Annual Report on Form 10-K for the year ended December 31, 1995 on file with the Securities and Exchange Commission. Management's Discussion and Analysis of Financial Condition And Results of Operations a. Financial Condition The Partnership has fully satisfied its commitments to contribute funds to the Joint Ventures for the production of, and acquisition of interests in, films. At March 31, 1996, the Partnership held cash of approximately $164,000 and short-term investments of approximately $1,118,000. Based on the performance of the films released through the Columbia Joint Venture and the Tri-Star Joint Venture, as of March 31,1996, the Distributors made Distribution Fee Reduction Payments with respect to their films of which approximately $531,000 and $1,503,000, respectively, was allocated to the Partnership. The payments are net of amounts withheld by the Distributor for the recoupment of Advances. Since these payments were not sufficient to enable either Joint Venture to recoup its Expenditures, each Distributor is required to pay its respective Joint Venture an amount equal to all subsequent distribution fees earned by it from the distribution of films on behalf of that Joint Venture up to its unrecouped Expenditures. If the Joint Ventures are able to recoup their Expenditures, the Distributors will be entitled to recoup these payments, with interest, from amounts thereafter otherwise payable to the Partnership. The Partnership is in the process of evaluating the value of its interest in the film assets for the purpose of possibly selling that interest and eventually liquidating the Partnership. The General Partner anticipates that the Partnership will be liquidated by the end of 1996. No assurance can be provided that the film assets will be successfully sold, or if sold, on such schedule. Upon the ultimate sale of the film assets, the Partnership will commence taking steps to liquidate and dissolve. Since the Partnership's obligation to make contributions to the Joint Ventures for the production of, and acquisition of interests in, films has been satisfied, all revenues received by the Partnership is used to establish a reserve for operating expenses of the Partnership and, to the extent possible, to make cash distributions to partners. The Partnership does not anticipate significant future revenues and accordingly, the Partnership does not currently anticipate making cash distributions to partners on a quarterly basis. However, the Partnership may make future distributions if it realizes proceeds from its interest in films or from the sale of its interest in films (should the sale occur) net of a reserve for the Partnership's operating expenses. The Partnership commenced cash distributions to its partners in February 1986. Distributions to limited partners through March 31, 1996 have aggregated $3,070 per unit (61.4% of the limited partners' original $5,000 investment in the Partnership). b. Results of Operations The Partnership's operating results are primarily dependent upon the operating results of the Joint Ventures and are significantly impacted by the Joint Ventures' policies. The performance of each film is based upon the amount expended for production and other costs associated with a film and the revenue generated by a film. The amount and timing of revenue generated by each film is dependent upon the degree of acceptance by the consumer public and the particular ancillary market in which the film is then being exhibited. Amounts contributed toward each film are compared periodically to the expected total revenue to be generated for that film, and write-downs may occur to the extent the amounts invested exceed the expected total revenue for that film. Additionally, each Joint Venture records income with respect to the Distribution Fee Reduction Payments, to the extent available, which may allow it to recover its investment in films. For the three months ended March 31, 1996, the Columbia Joint Venture had a net profit of which the Partnership's share was approximately $99,000, due primarily to the profitable results of certain films. The Tri-Star Joint Venture had a net profit of which the Partnership's share was approximately $77,000, due primarily to the profitable results of certain films. In addition, the Partnership earned approximately $13,000 of interest income from its short-term investments and incurred approximately $63,000 of expenses from its operations, resulting in an overall net profit to the Partnership of approximately $126,000. For the three months ended March 31, 1995, the Columbia Joint Venture had a net profit of which the Partnership's share was approximately $18,000, due primarily to the profitable results of certain films. The Tri-Star Joint Venture had a net profit of which the Partnership's share was approximately $181,000, due primarily to the accrual of Distribution Fee Reduction Payments and the profitable results of certain films. In addition, the Partnership earned approximately $16,000 of interest income from its short-term investments and incurred approximately $61,000 of expenses from its operations, resulting in an overall net profit to the Partnership of approximately $154,000. The decrease in interest income for the three month period ended March 31, 1996 as compared with the corresponding period in 1995 is due primarily to lower interest rates earned on short-term investments during 1996. The Partnership's operating expenses for the three month period ended March 31, 1996 as compared with the corresponding period in 1995 was virtually unchanged. COLUMBIA-DELPHI III PRODUCTIONS (A Joint Venture) BALANCE SHEETS (000's Omitted) Unaudited
March December 31, 31, 1996 1995 ASSETS Motion Picture Production and Advertising Costs, net of accumulated amortization of $76,784 and $76,726, $ $ respectively 702 760 Motion Picture Costs Recoverable from Distribution Fees 180 171 Receivable from Columbia Pictures (Distributor) 2,100 2,010 Total $ 2,982 $ Assets 2,941 LIABILITIES AND VENTURERS' CAPITAL Liabilities: Payable to Columbia Pictures $ $ Industries, Inc. 1,602 1,541 Payable to Delphi Film Associates III 678 640 Total Liabilities 2,280 2,181 Venturers' Capital: Columbia Pictures Industries, 569 613 Inc. Delphi Film Associates III 133 147 Total Venturers' Capital 702 760 Total Liabilities and Venturers' $ $ 2,941 Capital 2,982 See accompanying notes to the financial statements.
COLUMBIA - DELPHI III PRODUCTIONS (A Joint Venture) STATEMENTS OF OPERATIONS (000's Omitted) Unaudited
For the Three Months Ended March 31, 1996 1995 Net Revenue From Motion Picture Exploitation $ $ 378 86 Less: Amortization of Motion Picture Production and Advertising Costs 58 43 Income from Operations 43 320 Accrued Distribution Fee Reduction 16 0 Net Income $ $ 336 43 See accompanying notes to the financial statements.
COLUMBIA - DELPHI III PRODUCTIONS (A Joint Venture) STATEMENTS OF CASH FLOWS (000's Omitted) Unaudited
For the ThreeMonths Ended March 31, 1996 1995 Cash Flow From Operating Activities: Net Income $ $ 336 43 Adjustments to reconcile Net Income to net cash provided by operating activities: Amortization of Motion Picture Production and Advertising Costs 58 43 Accrued Distributions to (99) 251 Venturers Changes in Assets and Liabilities: Increase (Decrease) in Payable to Columbia Pictures Industries, 61 (183) Inc. (Increase) Decrease in Receivable from Columbia Pictures (90) 157 (Distributor) (Increase) Decrease in Motion Picture Costs Recoverable from (9) Distribution Fees 94 Increase (Decrease) in Payable to Delphi Film Associates III, net 38 (41) Decrease in Advance from Columbia Pictures Industries, Inc. (Distributor) 0 (27) Net Cash Provided by Operating Activities 295 337 Cash Flow from Financing Activities: Distributions to Venturers (295) (337) Net Cash Used by Financing Activities (295) (337) Net Change in Cash 0 0 Cash at beginning of period 0 0 Cash at end of period $ $ 0 0 See accompanying notes to the financial statements.
COLUMBIA - DELPHI III PRODUCTIONS (A Joint Venture) NOTES TO FINANCIAL STATEMENTS Unaudited 1. Basis of Presentation The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information. They do not include all information and notes required by generally accepted accounting principles for complete financial statements. There has been no material change in the information disclosed in the notes to financial statements of the Joint Venture included in the Annual Report on Form 10-K of Delphi Film Associates III (the "Partnership") for the year ended December 31, 1995. The information furnished includes all adjustments which are, in the opinion of management, necessary to present fairly the financial position of the Joint Venture as of March 31, 1996 and the results of its operations and cash flows for the periods ended March 31, 1996 and 1995. Results of operations for the period ended March 31, 1996 are not necessarily indicative of the results that may be expected for the entire fiscal year. 2. Current Operations All seven films in which the Joint Venture has an interest have completed their theatrical release and are being distributed in various ancillary markets. For the three month period ended March 31, 1996, the Joint Venture is reporting net revenue of $378,000, due primarily to the performance of its films in the worldwide free and pay television markets. For the three month period ended March 31, 1995, the Joint Venture reported net revenue of $86,000 due primarily to the performance of the films in the worldwide free television market. 3. Distribution Fee Reduction The Joint Venture was entitled to a payment from its Distributor in reduction of the Distributor's aggregate distribution fee if, by June 30, 1991, the Joint Venture had not received, in the aggregate, from net proceeds and gross receipts (excluding amounts paid to the Joint Venture for the recovery of advertising and promotion charge payments) an amount at least equal to the amounts spent by the Joint Venture for the production of films and the acquisition of interests in films (excluding certain amounts spent for payments in the nature of interest) (the "Expenditures"). Payments totaling $2,343,000 were made to the Joint Venture representing the aggregate distribution fee previously received by its Distributor. The payment to the Joint Venture was allocated to the Partnership and Columbia based on their respective percentage interest in a film for which a distribution fee was received. In addition, the Distributor is required to pay to the Joint Venture an amount equal to all subsequent distribution fees earned by it until the Joint Venture has recouped an amount equal to its Expenditures. Accordingly, $180,000 has been accrued as Motion Picture Costs Recoverable from Distribution Fees as of March 31, 1996, in the accompanying financial statements. 4. Additional Information Additional information, including the audited year end 1995 Financial Statements and the Summary of Significant Accounting Policies, is included in the Annual Report on Form 10-K of the Partnership for the year ended December 31, 1995. TRI-STAR -DELPHI III PRODUCTIONS (A Joint Venture) BALANCE SHEETS (000's Omitted) Unaudited
December March 31, 31, 1996 1995 ASSETS Motion Picture Production and Advertising Costs, net of accumulated amortization of $194,723 and $194,664, $ 2,607 $ respectively 2,666 Motion Picture Costs Recoverable from Distribution Fees 1,347 1,432 Receivable from TriStar Pictures, Inc. (Distributor) 479 476 Total $ 4,433 $ Assets 4,574 LIABILITIES AND VENTURERS' CAPITAL Liabilities: Payable to TriStar Pictures, $ 1,363 $ Inc. 1,405 Payable to Delphi Film Associates III 463 503 Total Liabilities 1,826 1,908 Venturers' Capital: TriStar Pictures, Inc. 2,171 2,210 Delphi Film Associates III 436 456 Total Venturers' Capital 2,607 2,666 Total Liabilities and Venturers' $ $ Capital 4,433 4,574 See accompanying notes to the financial statements.
TRI-STAR-DELPHI III PRODUCTIONS (A Joint Venture) STATEMENTS OF OPERATIONS (000's Omitted) Unaudited
For the Three Months Ended March 31, 1996 1995 Net Revenue From Motion Picture Exploitation $ $ 354 117 Less: Amortization of Motion Picture Production and Advertising Costs 59 22 Income from Operations 295 95 Accrued Distribution Fee Reduction 0 461 Net Income $ $ 295 556 See accompanying notes to the financial statements.
TRI-STAR - DELPHI III PRODUCTIONS (A Joint Venture) STATEMENTS OF CASH FLOWS (000's Omitted) Unaudited
For the Three Months Ended March 31, 1996 1995 Cash Flow From Operating Activities: Net Income $ $ 295 556 Adjustments to reconcile Net Income to net cash provided by operating activities: Amortization of Motion Picture Production and Advertising Costs 59 22 Accrued Distributions to 82 (259) Venturers Changes in Assets and Liabilities: (Decrease) Increase in Payable to Delphi Film Associates III, net (40) 71 (Decrease ) Increase in Payable to TriStar Pictures, Inc. (42) 188 Increase in Receivable from TriStar Pictures, Inc. (3) 0 (Distributor) Increase in Payable to TriStar Pictures, Inc. 0 59 (Distributor) Decrease (Increase) in Motion Picture Costs Recoverable from Distribution Fees 85 (318) Net Cash Provided by Operating Activities 436 319 Cash Flow From Financing Activities: Distributions to Venturers (436) (319) Net Cash Used by Financing Activities (436) (319) Net Change in Cash 0 0 Cash at beginning of period 0 0 Cash at end of period $ $ 0 0 See accompanying notes to the financial statements.
TRISTAR - DELPHI III PRODUCTIONS (A Joint Venture) NOTES TO FINANCIAL STATEMENTS Unaudited 1. Basis of Presentation The accompanying unaudited financial statements have been prepared in accordance with generally accepted accounting principles for interim financial information. They do not include all information and notes required by generally accepted accounting principles for complete financial statements. There has been no material change in the information disclosed in the notes to financial statements of the Joint Venture included in the Annual Report on Form 10-K of Delphi Film Associates III (the "Partnership") for the year ended December 31, 1995. The information furnished includes all adjustments which are, in the opinion of management, necessary to present fairly the financial position of the Joint Venture as of March 31, 1996 and the results of its operations and cash flows for the periods ended March 31, 1996 and 1995. Results of operations for the period ended March 31, 1996 are not necessarily indicative of the results that may be expected for the entire fiscal year. 2. Current Operations All twenty-seven films in which the Joint Venture has an interest have completed their theatrical release and are being distributed in various ancillary markets. For the three month period ended March 31, 1996 the Joint Venture is reporting net revenue of $354,000, due primarily to the performance of its films in the worldwide free and pay television markets. For the three month period ended March 31, 1995, the Joint Venture reported net revenue of $117,000 due primarily to the performance of its films in the worldwide free television market. For the three month period ended March 31, 1995, the Joint Venture recorded an increase of $461,000 in Motion Picture Costs Recoverable from Distribution Fees due to a change in the estimated distribution fee to be earned by the Distributor. 3. Distribution Fee Reduction The Joint Venture was entitled to a payment from its Distributor in reduction of the Distributor's aggregate distribution fee if, by June 30, 1991, the Joint Venture had not received, in the aggregate, from net proceeds and gross receipts (excluding amounts paid to the Joint Venture for the recovery of advertising and promotion charge payments) an amount at least equal to the amounts spent by the Joint Venture for the production of films and the acquisition of interests in films (excluding certain amounts spent for payments in the nature of interest) (the "Expenditures"). Payments totaling $4,662,000 were made to the Joint Venture representing the aggregate distribution fee previously received by its Distributor. The payment to the Joint Venture was allocated to the Partnership and TriStar based on their respective percentage interest in the films for which a distribution fee was received. The Distributor is required to pay to the Joint Venture an amount equal to all subsequent distribution fees earned by it until the Joint Venture has recouped an amount equal to its Expenditures. Accordingly, $1,347,000 has been accrued as Motion Picture Costs Recoverable from Distribution Fees as of March 31, 1996, in the accompanying financial statements. 4. Additional Information Additional information, including the audited year end 1995 Financial Statements and the Summary of Significant Accounting Policies, is included in the Annual Report on Form 10-K of the Partnership for the year ended December 31, 1995. PART II Item 1. Legal Proceedings None Item 2. Changes in Securities None Item 3.Defaults Upon Senior Securities None Item 4.Submission of Matters to a Vote of Security Holders None Item 5. Other Information None Item 6.Exhibits and Reports on Form 8-K A). Exhibits
EXHIBIT NUMBERDESCRIPTIONPAGE NUMBER 27 Financial Data Schedule
B). 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. DELPHI FILM ASSOCIATES III A New York Limited Partnership By: THE DELPHI GROUP, General Partner By: ML Film Entertainment, Inc., Managing Partner May 10, 1996 /s/ Diane T. Herte________________ Date Diane T. Herte Treasurer of the Managing Partner of the General Partner (principal financial officer and principal accounting officer of the Registrant) May 10, 1996 /s/ Steven N. Baumgarten__________ Date Steven N. Baumgarten Director and Vice President of the Managing Partner of the General Partner EX-27 2 ART. 5 FDS FOR THE 1996 FIRST QUARTER 10-Q
5 This schedule contains summary financial information extracted from Balance Sheets and Statement of Operations for the first quarter ended March 31, 1996 Form 10Q of Delphi Film Associates III and is qualified in its entirety by reference to such financial statements. 3-MOS DEC-31-1996 MAR-31-1996 164,000 1,118,000 1,141,000 0 0 0 0 0 2,977,000 0 0 0 0 0 2,943,000 2,977,000 0 13,000 0 0 63,000 0 0 126,000 0 0 0 0 0 126,000 13.00 0
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