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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, 2002
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[ ] Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934
For the transition period from to
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Commission File Number 0-28136
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ICON Cash Flow Partners L.P. Six
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(Exact name of registrant as specified in its charter)
Delaware 13-3723089
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(State or other jurisdiction of (IRS Employer
incorporation or organization) Identification Number)
100 Fifth Avenue, New York, New York 10011
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(Address of principal executive offices) (Zip code)
(212) 418-4700
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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.
[ x ] Yes [ ] No
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
ICON Cash Flow Partners L.P. Six
(A Delaware Limited Partnership)
Consolidated Balance Sheets
(unaudited)
June 30, December 31,
2002 2001
---- ----
Assets
Cash $ 37,000 $ 384,816
------------ ------------
Investment in finance leases
Minimum rents receivable 4,482,514 5,635,382
Estimated unguaranteed residual values 1,963,802 2,033,755
Initial direct costs 2,290 5,563
Unearned income (398,040) (650,225)
Allowance for doubtful accounts (277,068) (277,068)
------------ ------------
5,773,498 6,747,407
------------ ------------
Investment in operating leases
Equipment, at cost 22,030,584 22,051,594
Accumulated depreciation (6,924,370) (5,831,958)
------------ ------------
15,106,214 16,219,636
------------ ------------
Investments in unconsolidated joint ventures 1,064,917 1,321,509
------------ ------------
Other assets 180,833 1,916,251
------------ ------------
Total assets $ 22,162,462 $ 26,589,619
============ ============
(continued on next page)
ICON Cash Flow Partners L.P. Six
(A Delaware Limited Partnership)
Consolidated Balance Sheets (Continued)
(unaudited)
June 30, December 31,
2002 2001
---- ----
Liabilities and Partners' Equity
Notes payable - non-recourse $ 13,597,398 $ 15,596,106
Security deposits and deferred credits 847,601 1,022,524
Accounts payable-other 296,560 340,828
Accounts payable General Partners and affiliates 90,757 94,812
Minority interest in consolidated joint venture 71,470 72,070
14,903,786 17,126,340
------------ ------------
Partners' equity (deficiency)
General Partner (254,934) (233,078)
Limited partners (378,288 units outstanding,
$100 per unit original issue price) 7,513,610 9,696,357
------------ ------------
Total partners' equity 7,258,676 9,463,279
------------ ------------
Total liabilities and partners' equity $ 22,162,462 $ 26,589,619
============ ============
See accompanying notes to consolidated financial statements.
ICON Cash Flow Partners L.P. Six
(A Delaware Limited Partnership)
Consolidated Statements of Operations
(unaudited)
For the Three Months For the Six Months
Ended June 30, Ended June 30,
2002 2001 2002 2001
---- ---- ---- ----
Revenues
Rental income $ 879,453 $ 931,489 $ 1,759,539 $ 1,928,915
Finance lease income 129,892 241,673 270,100 498,333
Gain on sales of equipment 35,079 166,898 39,079 701,461
Income (loss) from equity investment
in unconsolidated joint ventures 13,835 (581,483) 27,531 (567,785)
Other income 55,569 85,003 112,101 184,097
------------- ------------- ------------- -------------
Total revenues 1,113,828 843,580 2,208,350 2,745,021
------------- ------------- ------------- -------------
Expenses
Depreciation 556,571 430,568 1,113,861 861,136
Interest 423,782 523,205 860,835 1,067,070
General and administrative 92,400 56,117 266,392 137,345
Management fees - General Partner 87,506 113,061 173,866 219,239
Administrative expense reimbursements
- General Partner 41,336 55,587 81,149 100,654
Amortization of initial direct costs 428 6,210 3,273 12,111
Minority interest in joint ventures (282) 1,354 (600) 2,691
------------- ------------- ------------- -------------
Total expenses 1,201,741 1,186,102 2,498,776 2,400,246
------------- ------------- ------------- -------------
Net (loss) income $ (87,913) $ (342,522) $ (290,426) $ 344,775
============= ============= ============= =============
Net (loss) income allocable to:
Limited partners $ (87,034) $ (339,097) $ (287,522) $ 341,327
General Partner (879) (3,425) (2,904) 3,448
------------- ------------- ------------- -------------
$ (87,913) $ (342,522) $ (290,426) $ 344,775
============= ============= ============= =============
Weighted average number of limited
partnership units outstanding 378,288 378,168 378,288 378,168
============= ============= ============= =============
Net (loss) income per weighted average
limited partnership unit $ (.23) $ (.90) $ (.76) $ .90
============= ============= ============= =============
See accompanying notes to consolidated financial statements.
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
Consolidated Statements of Changes in Partners' Equity
For the Six Months Ended June 30, 2002
and the year ended December 31, 2001
(unaudited)
Limited Partner Distributions
Return of Investment Limited General
Capital Income Partners Partner Total
(Per weighted average unit)
Balance at
December 31, 2000 $ 13,529,157 $ (194,393) $ 13,334,764
Cash distributions
to partners $ 9.22 $ - (3,488,143) (35,204) (3,523,347)
Net loss (344,657) (3,481) (348,138)
------------- ----------- ------------
Balance at
December 31, 2001 9,696,357 (233,078) 9,463,279
Cash distributions
to partners $ 5.01 $ - (1,895,225) (18,952) (1,914,177)
Net loss (287,522) (2,904) (290,426)
------------- ----------- ------------
Balance at
June 30, 2002 $ 7,513,610 $ (254,934) $ 7,258,676
=== ==== ============= =========== ============
See accompanying notes to consolidated financial statements.
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
Consolidated Statements of Cash Flows
For the Six Months Ended June 30,
(unaudited)
2002 2001
---- ----
Cash flows from operating activities:
Net (loss) income $ (290,426) $ 344,775
----------- -----------
Adjustments to reconcile net (loss)
income to net cash used in operating
activities:
Rental income - paid directly to
lenders by lessees (1,646,397) (1,928,915)
Interest expense on non-recourse financing
paid directly by lessees 796,263 1,002,498
Finance income portion of receivables paid
directly to lenders by lessees (245,683) (399,182)
Amortization of initial direct costs and
loan fees 67,845 76,683
(Income) loss from investments in
unconsolidated joint ventures (27,531) 567,785
Depreciation 1,113,861 861,136
Gain on sales of equipment (39,079) (701,461)
Minority interest in consolidated
joint venture (600) 2,691
Change in operating assets and liabilities:
Other assets 13,361 (140,119)
Non-financed receivables -- 220,915
Security deposits and deferred credits (64,329) (227,699)
Accounts payable - other 14,663 120,143
Accounts payable to General Partner
and affiliates (4,055) --
Other 5,625 (59,453)
----------- -----------
Total adjustments (16,056) (604,978)
----------- -----------
Net cash used in operating activities (306,482) (260,203)
----------- -----------
Cash flows from investing activities:
Proceeds from sales of equipment 1,588,720 3,652,921
Distributions received from unconsolidated
joint ventures 284,123 --
----------- -----------
Net cash provided by investing activities 1,872,843 3,652,921
----------- -----------
(continued on next page)
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
Consolidated Statements of Cash Flows (Continued)
For the Six Months Ended June 30,
(unaudited)
2002 2001
---- ----
Cash flows from financing activities:
Cash distributions to partners (1,914,177) (2,910,404)
---------- ----------
Principal payments on notes payable -
non-recourse -- (1,189,055)
Net cash used in financing activities (1,914,177) (4,099,459)
---------- ----------
Net decrease in cash (347,816) (706,741)
Cash and cash equivalents at beginning of period 384,816 838,897
---------- ----------
Cash and cash equivalents at end of period $ 37,000 $ 132,156
=========== ===========
See accompanying notes to consolidated financial statements.
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
Consolidated Statements of Cash Flows (continued)
Supplemental Disclosures of Cash Flow Information
For the six months ended June 30, 2002 and 2001, non-cash activities
included the following:
2002 2001
---- ----
Principal and interest on direct finance
receivables paid directly to lenders by lessees $ 1,148,574 $ 1,281,625
Rental income assigned operating lease receivable 1,646,397 1,928,915
Principal and interest on non-recourse
financing paid directly to lenders by lessees (2,794,971) (3,210,540)
----------- -----------
$ - $ -
=========== ===========
2002 2001
---- ----
Interest expense:
Interest paid directly to lenders by lessees
pursuant to non-recourse financings $ 796,263 $ 1,002,498
Amortization of loan fee 64,572 64,572
----------- -----------
Total interest expense $ 860,835 $ 1,067,070
=========== ============
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
Notes to Consolidated Financial Statements
June 30, 2002
(unaudited)
1. Basis of Presentation
The consolidated financial statements of ICON Cash Flow Partners L.P. Six
(the "Partnership") have been prepared pursuant to the rules and regulations of
the Securities and Exchange Commission (the "SEC") and, in the opinion of
management, include all adjustments (consisting only of normal recurring
accruals) necessary for a fair statement of results for each period shown.
Certain information and footnote disclosures normally included in consolidated
financial statements prepared in accordance with accounting principles generally
accepted in the United States of America have been condensed or omitted pursuant
to such SEC rules and regulations. Management believes that the disclosures made
are adequate to make the information presented not misleading. The results for
the interim period are not necessarily indicative of the results for the full
year. These consolidated financial statements should be read in conjunction with
the consolidated financial statements and notes included in the Partnership's
2001 Annual Report on Form 10-K. Certain 2001 amounts have been reclassified to
conform to the 2002 presentation.
2. Related Party Transactions
Fees paid or accrued by the Partnership to the General Partner or its
affiliates for the six months ended June 30, 2002 and 2001 are as follows:
2002 2001
Management fees $ 173,866 $ 219,239 Charged to operations
Administrative expense
reimbursements 81,149 100,654 Charged to operations
---------- ----------
Total $ 255,015 $ 319,893
========== ==========
The Partnership has investments in seven joint ventures with other
partnerships sponsored by the General Partner. See Note 3 for information
relating to the current joint ventures.
3. Consolidated Ventures and Investments in Unconsolidated Joint Ventures
The Partnership and affiliates have investments in seven ventures involved
in acquiring and managing various assets.
Consolidated Venture
The venture described below is majority owned and consolidated with the
Partnership.
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
Notes to Consolidated Financial Statements
ICON Cash Flow Partners L.L.C. II
In March 1995, the Partnership and an affiliate, ICON Cash Flow Partners,
L.P., Series E ("Series E"), formed a venture, ICON Cash Flow Partners L.L.C. II
("ICON Cash Flow LLC II"), for the purpose of owning a commercial aircraft
subject to lease. The Partnership and Series E contributed 99% and 1% of the
cash required for such acquisition, respectively, to ICON Cash Flow LLC II. ICON
Cash Flow LLC II acquired the aircraft, assuming non-recourse debt and utilizing
contributions received from the Partnership and Series E. The lease is an
operating lease. Profits, losses, cash flow and disposition proceeds are
allocated 99% to the Partnership and 1% to Series E. The Partnership's
consolidated financial statements include 100% of the assets and liabilities and
revenues and expenses of ICON Cash Flow LLC II. Series E's investment in ICON
Cash Flow LLC II has been reflected as minority interest in joint venture on the
Partnership's consolidated balance sheets and as minority interest expense on
the consolidated statements of operations. The lease of the aircraft is
scheduled to expire in November 2002, unless renewed. The aircraft had a net
book value of approximately $13,342,000 and related outstanding non-recourse
debt of $9,223,000 at June 30, 2002.
Investments in Unconsolidated Joint Ventures
The six joint ventures described below are less than 50% owned and are
accounted for following the equity method.
ICON Cash Flow Partners L.L.C. I
In September 1994 the Partnership and an affiliate, Series E, formed a
joint venture, ICON Cash Flow Partners L.L.C. I ("ICON Cash Flow LLC I"), for
the purpose of purchasing a commercial aircraft subject to lease. The
Partnership and Series E contributed 1% and 99% of the cash required for such
acquisition, respectively, to ICON Cash Flow LLC I. ICON Cash Flow LLC I
acquired the aircraft, assuming non-recourse debt and utilizing contributions
received from the Partnership and Series E. The lease is an operating lease.
Profits, losses, excess cash and disposition proceeds are allocated 1% to the
Partnership and 99% to Series E. The Partnership's investment in the joint
venture is accounted for under the equity method of accounting whereby the
Partnership's original investment was recorded at cost and was adjusted by its
share of income, losses and distributions thereafter. The lease of the aircraft
is scheduled to expire in October 2002, unless renewed.
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
Notes to Consolidated Financial Statements
Information as to the unaudited financial position and the results of
operations of ICON Cash Flow LLC I as of June 30, 2002 and December 31, 2001 and
for the six months ended June 30, 2002 and 2001 is summarized below:
June 30, 2002 December 31, 2001
------------- -----------------
Assets $ 17,056,361 $ 17,856,299
============= ===============
Liabilities $ 9,517,370 $ 10,158,274
============= ===============
Equity $ 7,538,991 $ 7,698,025
============= ===============
Partnership's share of equity $ 75,390 $ 76,981
============= ===============
Six Months Ended Six Months Ended
June 30, 2002 June 30, 2001
------------- -------------
Net (loss) income $ (159,034) $ 275,570
============= ===============
Partnership's share of net
(loss) income $ (1,591) $ 2,756
============= ===============
ICON Receivables 1997-A L.L.C.
In March 1997, the Partnership, ICON Cash Flow Partners, L.P., Series D
("Series D"), and ICON Cash Flow Partners L.P. Seven ("L.P. Seven") contributed
and assigned equipment lease and finance receivables and residuals to ICON
Receivables 1997-A L.L.C. ("1997-A). In September 1997, the Partnership, Series
E and L.P. Seven contributed and assigned additional equipment lease and finance
receivables and residuals to 1997-A. As of December 31, 2001, the Partnership,
Series D, Series E and L.P. Seven own 31.03%, 17.81%, 31.19% and 19.97%
interests, respectively, in 1997-A. The Partnership accounts for its investment
in 1997-A under the equity method of accounting.
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
Notes to Consolidated Financial Statements (continued)
Information as to the unaudited financial position and the results of
operations of 1997-A as of June 30, 2002 and December 31, 2001 and for the six
months ended June 30, 2002 and 2001 is summarized below:
June 30, 2002 December 31, 2001
------------- -----------------
Assets $ 633,941 $ 1,856,582
=========== ============
Liabilities $ 538,636 $ 1,707,445
=========== ============
Equity $ 95,305 $ 149,137
=========== ============
Partnership's share of equity $ 29,573 $ 46,277
=========== ============
Six Months Ended Six Months Ended
June 30, 2002 June 30, 2001
Net loss $ (53,832) $ (1,868,675)
=========== ============
Partnership's share of net loss $ (16,704) $ (618,829)
=========== ============
1997-A recorded a provision for bad debts of $1,825,000 during the six
month period ended June 30, 2001.
ICON Receivables 1997-B L.L.C.
In August 1997, the Partnership, Series E and L.P. Seven formed ICON
Receivables 1997-B L.L.C. ("1997-B"). The Partnership, Series E and L.P. Seven
each contributed cash, equipment leases and residuals and received an 8.33%,
75.00% and 16.67% interest, respectively, in 1997-B. The Partnership accounts
for its investment in 1997-B under the equity method of accounting.
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
Notes to Consolidated Financial Statements (continued)
Information as to the unaudited financial position and the results of
operations of 1997-B as of June 30, 2002 and December 31, 2001 and for the six
months ended June 30, 2002 and 2001 is summarized below:
June 30, 2002 December 31, 2001
------------- -----------------
Assets $ 4,230,393 $ 8,265,689
============ =============
Liabilities $ 4,230,393 $ 7,876,692
============ =============
Equity $ - $ 388,997
============ =============
Partnership's share of equity $ - $ 32,403
============ =============
Six Months Ended Six Months Ended
June 30, 2002 June 30, 2001
------------- -------------
Net loss $ (388,997) $ (311,245)
============ ==============
Partnership's share of net loss $ (32,403) $ (25,927)
============ ==============
1997-B recorded a provision for bad debts of $440,000 and $275,000 during
the six month periods ended June 30, 2002 and 2001, respectively.
ICON Boardman Funding L.L.C.
In December 1998, the Partnership and three affiliates, ICON Cash Flow
Partners, L.P., Series C ("Series C"), L.P. Seven and ICON Income Fund Eight A
L.P. ("Fund Eight A") formed ICON Boardman Funding L.L.C. ("ICON BF"), for the
purpose of acquiring a lease for a coal handling facility with Portland General
Electric, a utility company. The purchase price totaled $27,421,810, and was
funded with cash and non-recourse debt. The Partnership, Series C, L.P. Seven,
and Fund Eight A received a .5%, .5%, .5% and 98.5% interest, respectively, in
ICON BF. The Partnership accounts for its investment under the equity method of
accounting.
In 2001 the other joint venturers in ICON BF acquired Series C's interest
in accordance with their proportionate shares of ICON BF, at an aggregate cost
of $56,370, which represented Series C's carrying value of the investment. The
Partnership's share of the purchase price was $283. The remaining venturers'
shares in ICON BF at December 31, 2001 were .5025%, .5025%, and 98.995% for the
Partnership, L.P. Seven, and Fund Eight A, respectively.
Portland General Electric ("PGE") is a wholly owned subsidiary of Enron
Corporation ("Enron"), which recently filed for Chapter 11 bankruptcy
protection. PGE has not filed for bankruptcy. While Enron owns all of PGE's
outstanding common stock, PGE has its own legal entity, owns its assets and is
responsible for its own day-to-day operations. PGE continues to make its lease
payments and is current through July 2002.
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
Notes to Consolidated Financial Statements (continued)
Information as to the unaudited financial position and the results of
operations of ICON BF as of June 30, 2002 and December 31, 2001 and for the six
months ended June 30, 2002 and 2001 is summarized below:
June 30, 2002 December 31, 2001
Assets $ 22,256,680 $ 24,855,375
=============== ===============
Liabilities $ 10,337,276 $ 13,588,934
=============== ===============
Equity $ 11,919,404 $ 11,266,441
=============== ===============
Partnership's share of equity $ 59,895 $ 56,614
=============== ===============
Six Months Ended Six Months Ended
June 30, 2002 June 30, 2001
Net income $ 652,963 $ 699,814
=============== ===============
Partnership's share of net income $ 3,281 $ 3,499
=============== ===============
AIC Trust
In 1999, ICON/AIC Trust ("AIC Trust") was formed to own and manage a
portfolio of leases in England. The Partnership, L.P. Seven and Fund Eight A own
25.51%, 30.76% and 43.73% interests in AIC Trust, respectively. The Partnership
accounts for its investment under the equity method of accounting.
On December 28, 2001, AIC Trust sold its remaining leases, subject to the
related debt, at a loss, for a note receivable of (pound)2,575,000 ($3,744,822
based upon the exchange rate at December 31, 2001) which is payable in six
installments through June 2004. The first two installments on the note were
collected in January and June 2002, respectively. As of June 30, 2002, the gross
amount due is (pound)1,625,000 ($2,407,821 on a discounted basis based upon the
exchange rate at June 30, 2002).
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
Notes to Consolidated Financial Statements (continued)
Information as to the unaudited financial position and the results of
operations of AIC Trust as of June 30, 2002 and December 31, 2001 and for the
six months ended June 30, 2002 and 2001 is summarized below:
June 30, 2002 December 31, 2001
------------- -----------------
Assets $ 3,127,943 $ 3,849,439
=============== ===============
Liabilities $ 57,447 $ -
=============== ===============
Equity $ 3,070,496 $ 3,849,439
=============== ===============
Partnership's share of equity $ 783,284 $ 981,992
=============== ===============
Six Months Ended Six Months Ended
June 30, 2002 June 30, 2001
------------- -------------
Net income $ 253,820 $ 252,958
=============== ===============
Partnership's share of net income $ 64,750 $ 64,504
=============== ===============
Distributions $ 1,032,763 $ -
=============== ===============
Partnership's share of distributions $ 263,458 $ -
=============== ===============
AIC Trust recorded a foreign exchange loss of $71,152 in the three months
ended March 31, 2002 and a foreign exchange gain of $198,082 in the three months
ended June 30, 2002.
ICON Cheyenne LLC
In December 2000, the Partnership and three affiliates, L.P. Seven, Fund
Eight A and ICON Income Fund Eight B ("Fund Eight B") formed ICON Cheyenne LLC
("ICON Cheyenne") for the purpose of acquiring a portfolio of lease investments.
The purchase price totaled $29,705,716 and was funded with cash of $11,401,151
and the assumption of non-recourse debt with an unaffiliated third party lender
of $18,304,565. The debt is structured to be amortized by the application to the
debt of rentals due under the various term leases. The leases expire on various
dates through September 2006. The Partnership, L.P. Seven, Fund Eight A and Fund
Eight B received a 1%, 10.31%, 1% and 87.69% interest, respectively in ICON
Cheyenne. The Partnership accounts for its investment under the equity method of
accounting.
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
Notes to Consolidated Financial Statements (continued)
Information as to the unaudited financial position and the results of
operations of ICON Cheyenne as of June 30, 2002 and December 31, 2001 and for
the six months ended June 30, 2002 and 2001 is summarized below:
June 30, 2002 December 31, 2001
------------- -----------------
Assets $ 19,967,473 $ 23,869,671
============= ==============
Liabilities $ 8,290,031 $ 11,145,506
============= ==============
Equity $ 11,677,442 $ 12,724,165
============= ==============
Partnership's share of equity $ 116,775 $ 127,242
============= ==============
Six Months Ended Six Months Ended
June 30, 2002 June 30, 2001
Net income $ 1,019,824 $ 621,225
============= ==============
Partnership's share of net income $ 10,198 $ 6,212
============= ==============
Distributions $ 2,066,547 $ -
============= ==============
Partnership's share of distributions $ 20,665 $ -
============= ==============
ICON Cash Flow Partners L.P. Six
(A Delaware Limited Partnership)
June 30, 2002
Item 2. General Partner's Discussion and Analysis of Financial Condition
and Results of Operations
Results of Operations for the Three Months Ended June 30, 2002 and 2001
Rental income decreased by $52,036 or 6% in the quarter ended June 30, 2002
("2002 Quarter") as compared to the quarter ended June 30, 2001 ("2001 Quarter")
due to the expiration of operating leases since the 2001 Quarter. Finance lease
income decreased by $111,781 or approximately 46% in the 2002 Quarter as
compared to the 2001 Quarter due primarily to the continued collection of
rentals reducing the investment in financing leases, on which finance lease
income is based. The Partnership recorded gains on sales of equipment of $35,079
in the 2002 Quarter as compared to $166,898 in the 2001 Quarter; earned income
(loss) from its equity investments in joint ventures of $13,835 in the 2002
Quarter as compared to ($581,483) in the 2001 Quarter and other income of
$55,569 in the 2002 Quarter as compared to $85,003 in the 2001 Quarter. The loss
from equity investments in the 2001 Quarter was primarily due to the loss
recorded by 1997-A, of which the Partnership's share was $603,577.
Expenses for the 2002 Quarter were $1,201,741 as compared to $1,186,102 in
the 2001 Quarter, an increase of $15,639. The increase in expenses was primarily
the result of an increase in depreciation expense of $126,003. This increase was
partially offset by a decrease in interest expense of $99,423. Additionally,
general and administrative expenses increased by $36,283 in the 2002 Quarter as
compared to the 2001 Quarter, due principally to an increase in professional
fees. Depreciation expense increased as a result of a change (reduction) in the
estimate of the residual value of an aircraft in the fourth quarter of 2001.
Interest expense decreased due to a lower average debt balance outstanding in
2002 as compared to 2001 as the result of continued repayment of such debt.
Net loss for the three months ended June 30, 2002 and 2001 was $(87,913)
and $(342,522), respectively. The loss per weighted average limited partnership
unit outstanding was $(.23) and $(.90) for 2002 and 2001, respectively.
Results of Operations for the Six Months Ended June 30, 2002 and 2001
Rental income decreased by $169,376 or 9% in the six months ended June 30,
2002 ("2002 Period") as compared to the six months ended March 31, 2001 ("2001
Period") due to the expiration of operating leases (and subsequent sale of
underlying equipment) since the 2001 Period. Finance lease income decreased by
$228,233 or approximately 46% in the 2002 Period as compared to the 2001 Period
due primarily to the continued collection of rentals reducing the investment in
financing leases, on which finance lease income is based. The Partnership
recorded gains on sales of equipment of $39,079 in the 2002 Period as compared
to $701,461 in the 2001 Period; earned income from its equity investments in
joint ventures of $27,531 in the 2002 Period as compared to $(567,785) in the
2001 Period and other income of $112,101 in the 2002 Period as compared to
$184,097 in the 2001 Period. The loss from equity investments in the 2001 period
was primarily due to the loss recorded by 1997-A, of which the Partnership's
share was $618,829.
ICON Cash Flow Partners L.P. Six
(A Delaware Limited Partnership)
June 30, 2002
Expenses for the 2002 Period were $2,498,776 as compared to $2,400,246 in
the 2001 Period, an increase of $98,530. The increase in expenses was primarily
the result of an increase in depreciation expense of $252,725. This increase was
partially offset by a decrease in interest expense of $206,235. Additionally,
general and administrative expenses increased by $129,047 in the 2002 Period as
compared to the 2001 Period, due principally to an increase in professional
fees. Depreciation expense increased as a result of a change (reduction) in the
estimate of the residual value of an aircraft in the fourth quarter of 2001.
Interest expense decreased due to a lower average debt balance outstanding in
2002 as compared to 2001 as the result of continued repayment of such debt.
Net (loss) income for the six months ended June 30, 2002 and 2001 was
$(290,426) and $344,775, respectively. The net (loss) income per weighted
average limited partnership unit outstanding was $(.76) and $.90 for 2002 and
2001, respectively.
Liquidity and Capital Resources
The Partnership's primary source of funds for the 2002 Period was proceeds
from the sale of equipment of $1,588,720 (of which $1,552,256 represented a
collection of a receivable from a sale completed in late 2001) and distributions
from joint ventures of $284,123. These funds were used to pay operating expenses
and cash distributions to partners. The Partnership's outstanding debt is
non-recourse and is being serviced directly by the related lessees. The
Partnership intends to fund its future operating needs from finance and
operating leases and proceeds from sales of equipment. Cash distributions to
limited partners for the six months ended June 30, 2002 and 2001 totaled
$1,895,225 and $2,881,300, respectively. It should be noted that no
distributions were paid to the limited partners in the second quarter of 2002.
As of June 30, 2002, there were no known trends or demands, commitments,
events or uncertainties which are likely to have a material effect on liquidity.
As cash is realized from operations and sales of equipment, the Partnership will
distribute substantially all available cash, after retaining sufficient cash to
meet its reserve requirements and recurring obligations.
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
June 30, 2002
Item 3. Qualitative and Quantitative Disclosures About Market Risk
The Partnership is exposed to certain market risks, primarily changes in
interest rates and the demand for equipment and residuals owned by the
Partnership and its investees. The Partnership believes its exposure to other
market risks are insignificant to both its financial position and results of
operations.
The Partnership manages its interest rate risk by obtaining fixed rate
debt. The fixed rate debt service obligation streams are generally matched by
fixed rate lease receivable streams generated by the Partnership's lease
investments.
The Partnership manages its exposure to equipment and residual risk by
monitoring the market and maximizing the re-marketing proceeds received.
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
PART II - OTHER INFORMATION
Item 6 - Exhibits and Reports on Form 8-K
No reports on Form 8-K were filed during the quarter ended June 30, 2002.
Exhibits
99.1 Certification of Chairman and Chief Executive Officer pursuant to 18
U.S.C.ss.1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002.
99.2 Certification of Executive Vice President and Principal Financial and
Accounting Officer pursuant to 18 U.S.C.ss.1350, as adopted pursuant to
Section 906 of the Sarbanes-Oxley Act of 2002.
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
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.
ICON Cash Flow Partners L. P. Six
File No. 33-36376 (Registrant)
By its General Partner,
ICON Capital Corp.
August 14, 2002 /s/ Thomas W. Martin
------------------- ---------------------------------------------------
Date Thomas W. Martin
Executive Vice President
(Principal financial and accounting officer of
the General Partner of the Registrant)
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
June 30, 2002
EXHIBIT 99-1
I, Beaufort J.B. Clarke, Chairman and Chief Executive Officer of ICON
Capital Corp, the sole General Partner of ICON Cash Flow Partners L.P. Six,
certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:
(1) the Quarterly Report on Form 10-Q for the period ended June 30, 2002 (the
"Periodic Report") which this statement accompanies, fully complies with
the requirements of Section 13(a) of the Securities Exchange Act of 1934
(15 U.S.C. 78m) and
(2) information contained in the Periodic Report fairly presents, in all
material respects, the financial condition and results of operations of
ICON Cash Flow Partners L.P. Six.
Dated: August 14, 2002
/s/ Beaufort J.B. Clarke
------------------------------------------------------------------
Beaufort J.B. Clarke
Chairman and Chief Executive Officer
ICON Capital Corp.
sole General Partner of ICON Cash Flow Partners L.P. Six
ICON Cash Flow Partners L. P. Six
(A Delaware Limited Partnership)
June 30, 2002
EXHIBIT 99-2
I, Thomas W. Martin, Executive Vice President (Principal Financial and
Accounting Officer) of ICON Capital Corp, the sole General Partner of ICON Cash
Flow Partners L.P. Six, certify, pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002, that:
(1) the Quarterly Report on Form 10-Q for the period ended June 30, 2002 (the
"Periodic Report") which this statement accompanies, fully complies with
the requirements of Section 13(a) of the Securities Exchange Act of 1934
(15 U.S.C. 78m) and
(2) information contained in the Periodic Report fairly presents, in all
material respects, the financial condition and results of operations of
ICON Cash Flow Partners L.P. Six.
Dated: August 14, 2002
/s/ Thomas W. Martin
--------------------------------------------------------------
Thomas W. Martin
Executive Vice President (Principal
Financial and Accounting Officer)
ICON Capital Corp.
sole General Partner of ICON Cash Flow Partners L.P. Six