Back to GetFilings.com
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 June 30, 2003
/___/ Transition report pursuant to Section 13 or 15(d) of the
Securities Act of 1934
for the transition period from ______________ to ________________.
Commission File Number 2-96364
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 June 30, 2003 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 June 30, 2003.
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 June 30, 2003.
(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: July 31, 2003 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: July 31, 2003 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
July 31, 2003
QUARTERLY REPORT TO THE LIMITED PARTNERS
OF DSI REALTY INCOME FUND IX
DEAR LIMITED PARTNERS:
We are pleased to enclose the Partnership's unaudited consolidated financial
statements for the period ended June 30, 2003. 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 June 30, 2003 and 2002, total revenues
decreased 7.2% from $770,436 to $714,842 and total expenses decreased 7.9%
from $485,968 to $447,566 and other income decreased from $212 to $111.
Minority interest in income of real estate joint venture decreased 3.8% from
$32.739 to $31,505. As a result, net income decreased 6.4% from $251,941
to $235,882 for the three-month period ended June 30, 2003, as compared to
the same period in 2002. Rental revenue decreased as a result of lower
occupancy and unit rental rates. Occupancy levels for the Partnership's six
mini-storage facilities averaged 79.3% for the three-month period ended
June 30, 2003 as compared to 85.1% for the same period in 2002. The Partner-
ship is continuing its marketing efforts to attract and keep new tenants in
its various mini-storage facilities. Operating expenses decreased approxi-
mately $20,800 (5.2%) due primarily to a decrease in maintenance and repair,
property management fee, office supplies and power and sweeping expenses,
partially offset by increases in advertising, real estate tax and salaries
and wages expenses. General and administrative expenses decreased approxi-
mately $17,600 (20.55%) primarily as a result of decreases in legal and pro-
fessional and equipment and computer lease expenses. Minority interest in
income of real estate joint venture remained relatively constant.
For the six-months period ended June 30, 2003, and 2002, total revenues
decreased 6.0% from $1,571,645 to $1,478,155 and total expenses decreased
5.9% from $952,926 to $896,586 and other income decreased from $411 and $247.
Minority interest in income of real estate joint venture decreased 0.3% from
$69,927 to $69,689. As a result, net income decreased 6.8% from $549,203 to
$512,127 for the six-month period ended June 30, 2003, as compared to the same
period in 2002. Rental revenue decreased as a result of lower occupancy and
unit rental rates. Operating expenses decreased approximately $43,800 (5.5%)
due primarily to decreases in legal and professional, maintenance and repair,
property management fees, office supplies, workers compensation insurance,
security alarm services and travel expenses, partially offset by increases in
advertising, telephone and real estate tax expenses. General and administrative
expenses decreased approximately $12,600 (8.0%) as a result of decreases in
legal and professional and equipment and computer lease expenses. Minority
interest in income of real estate joint venture remained relatively constant.
On April 5, 2002, the General Partners received a copy of a hostile tender
offer from MacKenzie Patterson, Inc. and associated corporations and limited
partnerships to purchase all of the Units in the Partnership. This offer was
also filed with the Securities and Exchange Commission on the same date. The
General Partners have determined that the hostile tender offer was not in the
best interests of the Limited Partners, that the tender offer was grossly in-
adequate given the performance history of the Limited Partnership and the
inherent value of the Units, and recommended that the Limited Partners reject
the hostile tender offer and not tender their Units pursuant thereto. The
offer was subsequently increased and extended to June 30, 2002 and again to
July 22, 2002. The General Partners' initial determination regarding the
offer did not change. Prior to the expiration date of the offer, Limited
Partners tendered 22 Units representing 0.072% of the outstanding Units of
the Partnership.
The Limited Partners have approved an amendment to the Partnership Agreement
granting the General Partners ten days to review certain types of transfers
during which the General Partners may match, exceed or approve the proposed
transfers. The Court has rejected all preliminary attempts to halt implemen-
tation of the amendment.
The General Partners plan to continue their policy of funding improvements
and maintenance of Partnership properties with cash generated from
operations. The Partnership's resources appear to be adequate to meet
its needs. The General Partners anticipate distributions to the 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)
CONSOLIDATED BALANCE SHEETS(UNAUDITED)
JUNE 30, 2003 AND DECEMBER 31, 2002
June 30, December 31,
2003 2002
ASSETS
CASH AND CASH EQUIVALENTS $ 750,060 $ 631,709
PROPERTY, NET 4,105,873 4,308,446
OTHER ASSETS 132,559 109,240
TOTAL $4,988,492 $5,049,395
LIABILITIES AND PARTNERS' EQUITY (DEFICIT)
LIABILITIES $ 759,756 $ 718,214
MINORITY INTEREST IN
REAL ESTATE JOINT VENTURE 185,784 180,296
PARTNERS' EQUITY (DEFICIT):
General Partners (97,011) (95,932)
Limited Partners 4,139,963 4,246,817
Total partners' equity 4,042,952 4,150,885
TOTAL $4,988,492 $5,049,395
See accompanying notes to consolidated financial statements(unaudited).
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
FOR THE THREE MONTHS ENDED JUNE 30, 2003 AND 2002
June 30, June 30,
2003 2002
REVENUES:
Rental $ 714,842 $ 770,436
EXPENSES:
Operating 379,640 400,477
General and administrative 67,926 85,491
Total expenses 447,566 485,968
OPERATING INCOME 267,276 284,468
OTHER INCOME
Interest 111 212
INCOME BEFORE MINORITY INTEREST
IN INCOME OF REAL ESTATE
JOINT VENTURE 267,387 284,680
MINORITY INTEREST IN INCOME
OF REAL ESTATE JOINT VENTURE (31,505) (32,739)
NET INCOME $ 235,882 $ 251,941
AGGREGATE NET INCOME ALLOCATED TO:
Limited partners $ 233,523 $ 249,422
General partners 2,359 2,519
TOTAL $ 235,882 $ 251,941
NET INCOME PER LIMITED
PARTNERSHIP UNIT $ 7.61 $ 8.13
LIMITED PARTNERSHIP UNITS
USED IN PER UNIT CALCULATION 30,693 30,693
See accompanying notes to consolidated financial statements(unaudited).
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 2003 AND 2002
June 30, June 30,
2003 2002
REVENUES
Rental $1,478,155 $1,571,645
EXPENSES:
Operating 752,633 796,397
General and admininstrative 143,953 156,529
Total expenses 896,586 952,926
OPERATING INCOME 581,569 618,719
OTHER INCOME
Interest 247 411
INTEREST BEFORE MINORITY
INTEREST IN INCOME OF REAL
ESTATE JOINT VENTURE 581,816 619,130
MINORITY INTEREST IN INCOME
OF REAL ESTATE JOINT VENTURE (69,689) (69,927)
NET INCOME $ 512,127 $ 549,203
AGGREGATE NET INCOME ALLOCATED TO:
Limited Partners 507,006 543,711
General Partners 5,121 5,492
TOTAL $ 512,127 $ 549,203
NET INCOME PER LIMITED
PARTNERSHIP UNIT 16.52 17.71
LIMITED PARTNERSHIP UNITS
USED IN PER UNIT CALCULATION 30,693 30,693
See accompanying notes to consolidated financial statements (unaudited).
CONSOLIDATED STATEMENTS OF CHANGES IN PARTNERS' EQUITY (DEFICIT)(UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 2003
GENERAL LIMITED
PARTNERS PARTNERS TOTAL
BALANCE AT JANUARY 1, 2003 ($95,932) $4,246,817 $4,150,885
NET INCOME 5,121 507,006 512,127
DISTRIBUTIONS (6,200) (613,860) (620,060)
BALANCE AT JUNE 30, 2003 ($97,011) $4,139,963 $4,042,952
See accompanying notes to consolidated financial statements(unaudited).
CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE SIX MONTHS ENDED JUNE 30, 2003 AND 2002
June 30, June 30,
2003 2002
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 512,127 $ 549,203
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation 209,072 214,782
Minority interest in income
real estate joint venture 69,689 69,927
Changes in assets and
liabilities:
Increase in other assets (23,319) 2,787
Increase(decrease) in liabilities 41,542 (34,349)
Net cash provided by
operating activities 809,111 802,350
CASH FLOWS FROM INVESTING -
Additions to property (6,500) 0
CASH FLOWS FROM FINANCING ACTIVITIES -
Distributions to partners (620,060) (620,060)
Distributions paid to minority
interest in real estate
joint venture (64,200) (67,500)
Net cash used in
financing activities (684,260) (687,560)
NET INCREASE IN CASH AND
CASH EQUIVALENTS 118,351 114,790
CASH AND CASH EQUIVALENTS:
At beginning of period 631,709 633,503
At end of period $ 750,060 $ 748,293
See accompanying notes to consolidated 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 June 30, 2003,
and for the periods ended June 30, 2003, and 2002 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 June 30, 2003, the total cost and
accumulated depreciation of the mini-storage facilities are as follows:
Land $ 2,729,790
Buildings and equipment 11,069,326
Total 13,799,116
Less: Accumulated Depreciation ( 9,693,243)
Property - Net $ 4,105,873
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.
4. CONTROLS AND PROCEDURES
Within 90 days prior to the date this report, the Partnerhip evaluated the
effectiveness of its disclosure controls and procedures. This evaluation was
performed by the Partnership's Controller with the assistance of the Partner-
ship's President and Chief Executive Officer. These disclosure controls and
procedures are designed that the information required to be disclosed by the
Partnership in its periodic reports filed with the Securities and Exchange
Commission (the Commission) is recorded, processed, summarized and reported
within the time periods specified by the Commission's rules and forms, and
that the information is communicated to the certifying officers on a timely
basis. Based on this evaluation, the Partnership concluded that its dis-
closure controls and procedures were effective. There have been no signif-
icant changes in the Partnership's internal controls or in other factors that
could significantly affect the internal controls subsequent to the date of
their evaluation.
CERTIFICATIONS
I, Robert J. Conway, certify that:
1. I have reviewed this quarterly report on Form 10-Q of DSI Realty Income
Fund IX;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period cover-
ed by this quarterly report.
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its con-
solidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly
report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the effec-
tiveness of the disclosure controls and procedures based on our evalu-
ation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors:
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to re-
cord, process, summarize and report financial data and have identified
for the registrant's auditors any material weaknesses in internal
controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's in-
ternal controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether there were significant changes in internal controls
or in other factors that could significantly affect internal controls sub-
sequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: July 31, 2003
Robert J. Conway
Chief Executive Officer
CERTIFICATIONS
I, Richard P. Conway, certify that:
1. I have reviewed this quarterly report on Form 10-Q of DSI Realty Income
Fund IX;
2. Based on my knowledge, this quarterly report does not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements made, in light of the circumstances under which
such statements were made, not misleading with respect to the period cover-
ed by this quarterly report.
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly report, fairly present in all
material respects the financial condition, results of operations and cash
flows of the registrant as of, and for, the periods presented in this
quarterly report;
4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined
in Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:
a) designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its con-
solidated subsidiaries, is made known to us by others within those
entities, particularly during the period in which this quarterly
report is being prepared;
b) evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of
this quarterly report (the "Evaluation Date"); and
c) presented in this quarterly report our conclusions about the effec-
tiveness of the disclosure controls and procedures based on our evalu-
ation as of the Evaluation Date;
5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors:
a) all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to re-
cord, process, summarize and report financial data and have identified
for the registrant's auditors any material weaknesses in internal
controls; and
b) any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's in-
ternal controls; and
6. The registrant's other certifying officers and I have indicated in this
quarterly report whether there were significant changes in internal controls
or in other factors that could significantly affect internal controls sub-
sequent to the date of our most recent evaluation, including any corrective
actions with regard to significant deficiencies and material weaknesses.
Date: July 31, 2003
Richard P. Conway
Vice President
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of DSI Realty Income Fund IX (the
"Partnership") on Form 10-Q for the period ending June 30, 2003 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
I, Robert J. Conway, Chief Executive Officer of the Partnership, certify,
pursuant to 18 U.S.C. 1350, as adopted pursuant to 906 of the Sarbanes-Oxley
Act of 2002, that:
(1) The Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Partnership.
Robert J. Conway
Chief Executive Officer
July 31, 2003
CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO
SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002
In connection with the Quarterly Report of DSI Realty Income Fund IX (the
"Partnership") on Form 10-Q for the period ending June 30, 2003 as filed
with the Securities and Exchange Commission on the date hereof (the "Report"),
I, Richard P. Conway, Chief Executive Officer of the Partnership, certify,
pursuant to 18 U.S.C. 1350, as adopted pursuant to 906 of the Sarbanes-Oxley
Act of 2002, that:
(1) The Report fully complies with the requirements of section 13(a) or
15(d) of the Securities Exchange Act of 1934; and
(2) The information contained in the Report fairly presents, in all
material respects, the financial condition and result of operations of the
Partnership.
Richard P. Conway
Vice President
July 31, 2003