10-Q 1 dsi09901.txt 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 quarterly period ended September 30, 2001 /___/ Transition report pursuant to Section 13 or 15(d) of the Securities Act of 1934 for the transition period from ______________ to ________________. Commission File Number 2-90168 DSI REALTY INCOME FUND IX, A California Limited Partnership (Exact name of registrant as specified in its charter) California_______________________________________33-0103989 (State or other jurisdiction of (I.R.S. Employer incorporation) Identification No.) 6700 E. Pacific Coast Hwy., Long Beach, California 90803 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code-(562) 493-8881 _________________________________________________________________ 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. Yes _x_. No__. PART I - FINANCIAL INFORMATION Item 1. Financial Statements. The information required by Rule 10-01 of Regulation S-X is included in the Quarterly Report to the Limited Partners of Registrant for the period ended September 30, 2001, which is attached hereto as Exhibit "20" and incorporated herein by this reference. Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations. Registrant incorporates by this reference its Quarterly Report to Limited Partners for the period ended September 30, 2001. PART II - OTHER INFORMATION Item 6. Exhibits and Reports on Form 8K. (a) Attached hereto as Exhibit "20" is Registrant's Quarterly Report to Limited Partners for the period ended September 30, 2001. (B) Registrant did not file any reports on Form 8-K for the period reported upon. SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Dated: October 31, 2001 DSI REALTY INCOME FUND IX A California Limited Partnership (Registrant) By____\s\ Robert J. Conway_____ DSI Properties, Inc., as General Partner by ROBERT J. CONWAY, President and Chief Financial Officer SIGNATURES Pursuant to the requirements of the Securities and Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Dated: October 31, 2001 DSI REALTY INCOME FUND IX A California Limited Partnership (Registrant) By__\s\ Robert J. Conway________ DSI Properties, Inc., as General Partner by ROBERT J. CONWAY, President and Chief Financial Officer October 31, 2001 QUARTERLY REPORT TO THE LIMITED PARTNERS OF DSI REALTY INCOME FUND IX DEAR LIMITED PARTNERS: We are pleased to enclose the Partnership's unaudited financial statements for the period ended September 30, 2001. The following is Management's discussion and analysis of the Partnership's financial condition and results of its operations. For the three-month periods ended September 30, 2001 and 2000, total revenues increased 2.9% from $782,414 to $805,170 and total expenses de- creased 8.9% from $494,737 to $450,307 and other income decreased from $1,891 to $783. Minority interest in income of real estate joint venture increased 34.5% from $29,487 to $39,652. As a result, net income increased 21.5% from $260,081 to $315,994 for the three-month period ended September 30, 2001, as compared to the same period in 2000. Rental revenue increased as a result of higher unit rental rates. Occupancy levels for the Partnership's six mini-storage facilities averaged 87.8% for the three-month period ended September 30, 2001 as compared to 87.7% for the same period in 2000. The Partnership is continuing its marketing efforts to attract and keep new tenants in its various mini-storage facilities. Operating expenses decreased approximately $50,700 (11.2%) due primarily to decreases in advertising, salaries and wages, security alarm services and depreciation expenses, partially offset by an increase in maintenance and repair expense. The de- crease in depreciation is the result of one of the Partnership's properties being fully depreciated. General and administrative expenses remained relatively constant. Minority interest in income of real estate joint venture increased as a result of lower operating expenses at that facility, primarily as a result of a decrease in depreciation expense due to the property being fully depreciated as of December 31, 2000. For the nine-month periods ended September 30, 2001, and 2000, total revenues increased 9.5% from $2,184,154 to $2,391,231 and total expenses decreased 7.5% from $1,430,763 to $1,324,117 and other income decreased from $5,456 to $2,965. Minority interest in income of real estate joint venture in- creased 43.6% from $87,868 to $126,136. As a result, net income increased 40.7% from $670,979 to $943,943 for the nine-month period ended September 30, 2001, as compared to the same period in 2000. Rental revenue increased as a result of higher occupancy and unit rental rates. Operating expenses de- creased approximately $105,900 (8.5%) due primarily to decreases in advertis- ing, legal and professional,workers compensation insurance, security alarm services and depreciation expenses, partially offset by increases in mainten- ance and repair, property management fees, salaries and wage and power and sweeping expenses. Property management fees, which are based on rental revenue, increased as a result of the increase in rental revenue. Power and sweeping expenses increased as a result of above normal snow removal costs associated with heavy snowfalls in Illinois where Partnership properties are located. General and administrative expenses remained relatively constant. The increase in minority interest in income of real estate joint venture was discussed above. The General Partners will continue their policy of funding improvements and maintenance of Partnership properties with cash generated from operations. The Partnership's financial resources appear to be adequate to meet its needs. The General Partners anticipate distributions to Limited Partners to remain at the current level for the foreseeable future. We are not enclosing a copy of the Partnership Form 10-Q as filed with the Securities and Exchange Commission since all the information set forth therein is contained either in this letter or in the attached financial statements. However, if you wish to receive a copy of said report, please send a written request to DSI Realty Income Fund IX, P.O. Box 357, Long Beach, California 90801. Very truly yours, DSI REALTY INCOME FUND IX By: DSI Properties, Inc., as General Partner By /s/ Robert J. Conway ____________________________ ROBERT J. CONWAY, President DSI REALTY INCOME FUND IX (A California Real Estate Limited Partnership) BALANCE SHEETS(UNAUDITED) SEPTEMBER 30, 2001 AND DECEMBER 31, 2000
September 30, December 31, 2001 2000 ASSETS CASH AND CASH EQUIVALENTS $ 826,935 $ 509,410 PROPERTY, Net 4,824,230 5,137,840 OTHER ASSETS 70,924 61,924 TOTAL $5,722,089 $5,709,174 LIABILITIES AND PARTNERS' EQUITY (DEFICIT) LIABILITIES $ 748,187 $ 754,061 MINORITY INTEREST IN REAL ESTATE JOINT VENTURE 181,710 176,774 PARTNERS' EQUITY(DEFICIT): General Partners (89,519) (89,657) Limited Partners 4,881,711 4,867,996 Total partners' equity 4,792,192 4,778,339 TOTAL $5,722,089 $5,709,174 See accompanying notes to financial statements(unaudited). STATEMENTS OF INCOME (UNAUDITED) FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000 September 30, September 30, 2001 2000 REVENUES: Rental $ 805,170 $ 782,414 EXPENSES: Operating 403,852 454,557 General and administrative 46,455 40,180 Total expenses 450,307 494,737 OPERATING INCOME 354,863 287,677 OTHER INCOME Interest 783 1,891 INCOME BEFORE EQUITY IN INCOME OF REAL ESTATE JOINT VENTURE 355,646 289,568 MINORITY INTEREST IN INCOME OF REAL ESTATE JOINT VENTURE (39,652) (29,487) NET INCOME $ 315,994 $ 260,081 AGGREGATE NET INCOME ALLOCATED TO: Limited partners $ 312,834 $ 257,480 General partners 3,160 2,601 TOTAL $ 315,994 $ 260,081 NET INCOME PER LIMITED PARTNERSHIP UNIT $ 10.19 $ 8.39 LIMITED PARTNERSHIP UNITS USED IN PER UNIT CALCULATION 30,693 30,693 See accompanying notes to financial statements(unaudited). STATEMENTS OF INCOME (UNAUDITED) FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000 September 30, September 30, 2001 2000 REVENUES: Rental $2,391,231 $2,184,154 EXPENSES: Operating 1,144,899 1,250,752 General and Administrative 179,218 180,011 Total Expenses 1,324,117 1,430,763 OPERATING INCOME 1,067,114 753,391 OTHER INCOME Interest 2,965 5,456 INCOME BEFORE MINORITY INTEREST IN INCOME OF REAL ESTATE JOINT VENTURE 1,070,079 758,847 MINORITY INTEREST IN INCOME OF REAL ESTATE JOINT VENTURE (126,136) (87,868) NET INCOME $943,943 $670,979 AGGREGATE NET INCOME ALLOCATED TO: Limited Partners 943,504 664,269 General Partners 9,439 6,710 TOTAL 943,943 670,979 NET INCOME PER LIMITED PARTNERSHIP UNIT $30.45 $21.64 LIMITED PARTNERSHIP UNITS USED IN PER UNIT CALCULATION 30,693 30,693 See accompanying notes to financial statements(unaudited).
STATEMENTS OF CHANGES IN PARTNERS' EQUITY (DEFICIT)(UNAUDITED) FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
GENERAL LIMITED PARTNERS PARTNERS TOTAL BALANCE AT JANUARY 1, 2000 ($84,529) $5,375,693 $5,291,164 NET INCOME 6,710 664,269 670,979 DISTRIBUTIONS (9,300) (920,790) (930,090) BALANCE AT SEPTEMBER 30, 2000 ($87,119) $5,119,172 $5,032,053 BALANCE AT JANUARY 1, 2001 ($89,657) $4,867,996 $4,778,339 NET INCOME 9,439 934,504 943,943 DISTRIBUTIONS (9,301) (920,789) (930,090) BALANCE AT SEPTEMBER 30, 2001 ($89,519) $4,881,711 $4,792,192 See accompanying notes to consolidated financial statements(unaudited).
STATEMENTS OF CASH FLOWS (UNAUDITED) FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2001 AND 2000
September 30, September 30, 2001 2000 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 943,943 $670,979 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 313,610 440,813 Loss on disposal of property and equipment 656 Minority interest in income of real estate joint venture 126,136 87,868 Changes in assets and liabilities: (Increase)decrease in other assets (9,000) 2,199 (Decrease)increase in liabilities (5,874) 50,153 Net cash provided by operating activities 1,368,815 1,252,668 CASH FLOWS FROM FINANCING ACTIVITIES - Distributions to partners (930,090) (930,090) Distributions paid to minority interest in real estate joint venture (121,200) (129,300) Net cash used in financing activities (1,051,290) (1,059,390) NET INCREASE IN CASH AND CASH EQUIVALENTS 317,525 193,278 CASH AND CASH EQUIVALENTS: At beginning of period 509,410 503,249 At end of period $ 826,935 $696,527 See accompanying notes to financial statements(unaudited).
DSI REALTY INCOME FUND IX (A California Real Estate Limited Partnership) NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) 1. GENERAL DSI Realty Income Fund IX (the "Partnership"), a limited partnership, has three general partners (DSI Properties, Inc., Robert J. Conway and Joseph W. Conway) and limited partners owning 30,693 limited partnership units. The accompanying consolidated financial information as of September 30, 2001, and for the periods ended September 30, 2001, and 2000 is unaudited. Such financial information includes all adjustments which are considered necessary by the Partnership's management for a fair presentation of the results for the periods indicated. 2. PROPERTY The Partnership owns five mini-storage facilities located in Monterey Park and Azusa, California; Everett, Washington; and Romeoville and Elgin, Illinois. The Partnership also owns a 70% interest in a mini-storage facility in Aurora, Colorado. As of September 30, 2001, the total cost and accumulated depreciation of the mini-storage facilities are as follows: Land $ 2,729,790 Buildings and equipment 11,023,943 Total 13,753,733 Less: Accumulated Depreciation ( 8,929,503) Property - Net $ 4,824,230
3. NET INCOME PER LIMITED PARTNERSHIP UNIT Net income per limited partnership unit is calculated by dividing the net income allocated to the limited partners by the number of limited partnership units outstanding during the period.