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UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2007
 OR
 o
    
    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 0-27496
 CRONOS GLOBAL INCOME FUND XVI, L.P.
  California
(State or other jurisdiction of 
incorporation or organization)
    
    94-3230380
(I.R.S. Employer
Identification No.)
 One Front Street, Suite 925, San Francisco, California
    
    94111(Address of principal executive offices)
    
    (Zip Code)
 
 þ o
  o o þ
 o þ




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Report on Form 10-Q for the Quarterly Period
Ended March 31, 2007
 TABLE OF CONTENTS
  
 PAGEPART I  FINANCIAL INFORMATION
    
    
    3Item 1. Financial Statements
    
    
    3Condensed Balance Sheets  March 31, 2007 and December 31, 2006 (unaudited)
    
    
    4Condensed Statements of Operations for the three months ended March 31, 2007 and 2006 (unaudited)
    
    
    5Condensed Statements of Cash Flows for the three months ended March 31, 2007 and 2006 (unaudited)
    
    
    6Notes to Condensed Financial Statements (unaudited)
    
    
    7Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    12Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    17Item 4. Controls and Procedures
    
    
    17Item 4T. Controls and Procedures
    
    
    17PART II  OTHER INFORMATION
    
    
    18Item 1. Legal Proceedings
    
    
    18Item 1A. Risk Factors
    
    
    18Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    18Item 3. Defaults Upon Senior Securities
    
    
    18Item 4. Submissions of Matters to a Vote of Securities Holders
    
    
    18Item 5. Other Information
    
    
    18Item 6. Exhibits
    
    
    18EXHIBIT 31.1EXHIBIT 31.2EXHIBIT 32
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PART I  FINANCIAL INFORMATION
 
 Financial Statements
   3




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 
 Condensed Balance Sheets
 (Unaudited)
 March 31,
    
    
    December 31,2007
    
    
    2006AssetsCurrent assets:Cash and cash equivalents, includes $979,387 at March 31, 2007
and $1,188,374 at December 31, 2006 in interest-bearing accounts
    
    $
    994,387
    
    
    $
    1,203,374Net lease and other receivables due from Leasing Company
    
    
    343,007
    
    
    
    405,841Total current assets
    
    
    1,337,394
    
    
    
    1,609,215Container rental equipment, at cost
    
    
    24,566,412
    
    
    
    25,256,310Less accumulated depreciation
    
    
    (14,812,301
    )
    
    
    (14,851,810
    )Net container rental equipment
    
    
    9,754,111
    
    
    
    10,404,500Total assets
    
    $
    11,091,505
    
    
    $
    12,013,715Partners capitalPartners capital (deficit):General partner
    
    $
    (43,559
    )
    
    $
    (39,210
    )Limited partners
    
    
    11,135,064
    
    
    
    12,052,925Total partners capital
    
    $
    11,091,505
    
    
    $
    12,013,715
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CRONOS GLOBAL INCOME FUND XVI, L.P.
 
 Condensed Statements of Operations
 (Unaudited)
 Three Months EndedMarch 31,
    
    
    March 31,2007
    
    
    2006Net lease revenue
    
    $
    449,559
    
    
    $
    567,934Other operating income (expenses):Depreciation
    
    
    (392,727
    )
    
    
    (441,450
    )Other general and administrative expenses
    
    
    (27,270
    )
    
    
    (26,098
    )Net gain (loss) on disposal of equipment
    
    
    5,132
    
    
    
    (61,125
    )(414,865
    )
    
    
    (528,673
    )Income from operations
    
    
    34,694
    
    
    
    39,261Other income:Interest income
    
    
    13,370
    
    
    
    9,788Net income
    
    $
    48,064
    
    
    $
    49,049Allocation of net income:General partner
    
    $
    26,121
    
    
    $
    26,052Limited partners
    
    
    21,943
    
    
    
    22,997$
    48,064
    
    
    $
    49,049Limited partners per unit share of net income
    
    $
    0.01
    
    
    $
    0.01
  5




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 
 Condensed Statements of Cash Flows
 (Unaudited)
 Three Months EndedMarch 31,
    
    
    March 31,2007
    
    
    2006Net cash provided by operating activities
    
    $
    508,532
    
    
    $
    704,235Cash flows from investing activities:Proceeds from sale of container rental equipment
    
    
    252,756
    
    
    
    210,601Cash flows from financing activities:Distributions to general partner
    
    
    (30,470
    )
    
    
    (34,698
    )Distributions to limited partners
    
    
    (939,805
    )
    
    
    (853,157
    )Net cash used in financing activities
    
    
    (970,275
    )
    
    
    (887,855
    )Net (decrease) increase in cash and cash equivalents
    
    
    (208,987
    )
    
    
    26,981Cash and cash equivalents at the beginning of the period
    
    
    1,203,374
    
    
    
    1,048,262Cash and cash equivalents at the end of the period
    
    $
    994,387
    
    
    $
    1,075,243
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CRONOS GLOBAL INCOME FUND XVI, L.P.
 
 Notes to Unaudited Condensed Financial Statements
 Summary of Significant Accounting Policies
 (a)
    
    Nature of Operations
    th
 (b)
    
    Leasing Company and Leasing Agent Agreement
    7




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Unaudited Condensed Financial Statements
 (b)
    
    Leasing Company and Leasing Agent Agreement (continued)
  (c)
    
    Basis of Presentation
   (d)
    
    Use of Estimates
   (e)
    
    Container Rental Equipment
   8




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Unaudited Condensed Financial Statements
 (e)
    
    Container Rental Equipment (continued)
  (f)
    
    Allocation of Net Income or Loss, Partnership Distributions and Partners Capital
Accounts
     9




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Unaudited Condensed Financial Statements
 Net Lease and Other Receivables Due from Leasing Company
  March 31,
    
    
    December 31,2007
    
    
    2006Gross lease and other receivables
    
    $
    645,936
    
    
    $
    694,051Less:Direct operating payables and accrued expenses
    
    
    195,531
    
    
    
    203,928Base management fees payable
    
    
    31,180
    
    
    
    2,472Reimbursed administrative expenses
    
    
    12,612
    
    
    
    12,559Allowance for doubtful accounts
    
    
    63,606
    
    
    
    69,251302,929
    
    
    
    288,210Net lease and other receivables
    
    $
    343,007
    
    
    $
    405,841
 Net Lease Revenue
  Three Months EndedMarch 31,
    
    
    March 31,2007
    
    
    2006Rental revenue
    
    $
    698,354
    
    
    $
    907,033Less:Rental equipment operating expenses
    
    
    165,364
    
    
    
    224,866Base management fees
    
    
    48,377
    
    
    
    61,963Reimbursed administrative expensesSalaries
    
    
    23,348
    
    
    
    38,298Other payroll related expenses
    
    
    4,392
    
    
    
    5,262General and administrative expenses
    
    
    7,314
    
    
    
    8,710Total reimbursed administrative expenses
    
    
    35,054
    
    
    
    52,270248,795
    
    
    
    339,099Net lease revenue
    
    $
    449,559
    
    
    $
    567,934
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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Unaudited Condensed Financial Statements
 Operating Segment
   Three Months EndedMarch 31,
    
    
    March 31,2007
    
    
    2006Dry cargo containers
    
    $
    505,841
    
    
    $
    611,493Refrigerated containers
    
    
    152,473
    
    
    
    258,018Tank containers
    
    
    40,040
    
    
    
    37,522Total
    
    $
    698,354
    
    
    $
    907,033
  The Cronos Group
    11




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Managements Discussion and Analysis of Financial Condition and Results of
Operations
  Market Overview
       12




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Results of Operations
   
    
    Activity-related expenses, including agent and depot costs such as repairs,
maintenance and handling.
    
    Inventory-related expenses for off-hire containers, comprising storage and
repositioning costs. These costs are sensitive to the quantity of off-hire containers
as well as the frequency at which containers are re-delivered.
    
    Legal and other expenses, including legal costs related to the recovery of containers
and doubtful accounts, insurance and provisions for doubtful accounts.
 13




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Dry Cargo
    
    
    Refrigerated
    
    
    TankContainers
    
    
    Containers
    
    
    Containers40-Foot
    
    
    
    
    
    
    40-Foot20-Foot
    
    
    40-Foot
    
    
    High-Cube
    
    
    20-Foot
    
    
    High-Cube
    
    
    24,000-LiterContainers on lease:Master lease
    
    
    2,484
    
    
    
    696
    
    
    
    1,128
    
    
    
    37
    
    
    
    111
    
    
    
    27Term leaseShort term 1
    
    
    547
    
    
    
    227
    
    
    
    221
    
    
    
    3
    
    
    
    29
    
    
    
    9Long term 2
    
    
    173
    
    
    
    46
    
    
    
    43
    
    
    
    3
    
    
    
    18
    
    
    
    13Sales-type lease
    
    
    
    
    
    
    2
    
    
    
    4
    
    
    
    4
    
    
    
    1
    
    
    
    Subtotal
    
    
    3,204
    
    
    
    971
    
    
    
    1,396
    
    
    
    47
    
    
    
    159
    
    
    
    49Containers off lease
    
    
    272
    
    
    
    198
    
    
    
    258
    
    
    
    32
    
    
    
    25
    
    
    
    2Total container fleet
    
    
    3,476
    
    
    
    1,169
    
    
    
    1,654
    
    
    
    79
    
    
    
    184
    
    
    
    51
 
 1.
    
    Short term leases represent term leases that are either scheduled for renegotiation or
that may expire on or before March 2008.2.
    
    Long term leases represent term leases, the majority of which will expire between April 2008
and December 2011. Dry Cargo
    
    
    Refrigerated
    
    
    
    
    
    
    TankContainers
    
    
    Containers
    
    
    
    
    
    
    Containers40-Foot
    
    
    
    
    
    
    
    
    
    
    40-Foot20-Foot
    
    
    40-Foot
    
    
    High-Cube
    
    
    20-Foot
    
    
    High-Cube
    
    
    24,000-LiterUnits
    
    
    %
    
    
    Units
    
    
    %
    
    
    Units
    
    
    %
    
    
    Units
    
    
    %
    
    
    Units
    
    
    %
    
    
    Units
    
    
    %Total purchases
    
    
    4,553
    
    
    
    100
    %
    
    
    1,500
    
    
    
    100
    %
    
    
    1,750
    
    
    
    100
    %
    
    
    90
    
    
    
    100
    %
    
    
    300
    
    
    
    100
    %
    
    
    52
    
    
    
    100
    %Less disposals
    
    
    1,077
    
    
    
    24
    %
    
    
    331
    
    
    
    22
    %
    
    
    96
    
    
    
    5
    %
    
    
    11
    
    
    
    12
    %
    
    
    116
    
    
    
    39
    %
    
    
    1
    
    
    
    2
    %Remaining fleet at
March 31, 2007
    
    
    3,476
    
    
    
    76
    %
    
    
    1,169
    
    
    
    78
    %
    
    
    1,654
    
    
    
    95
    %
    
    
    79
    
    
    
    88
    %
    
    
    184
    
    
    
    61
    %
    
    
    51
    
    
    
    98
    %
 Three Months Ended March 31, 2007 Compared to the Three Months Ended March 31, 2006
 Net lease revenue
 Three Months EndedMarch 31,
    
    
    March 31,2007
    
    
    2006Fleet size (measured in twenty-foot equivalent units (TEU))Dry cargo containers
    
    
    9,250
    
    
    
    9,824Refrigerated containers
    
    
    455
    
    
    
    666Tank containers
    
    
    51
    
    
    
    52Average utilization ratesDry cargo containers
    
    
    86
    %
    
    
    86
    %Refrigerated containers
    
    
    78
    %
    
    
    86
    %Tank containers
    
    
    92
    %
    
    
    90
    %
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Depreciation expense
 Other general and administrative expenses
 Net gain on disposal of equipment
  Liquidity and Capital Resources
  th
  15




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Cash from Operating Activities:
 Cash from Investing Activities:
 Cash from Financing Activities
 Critical Accounting Policies
  
    
    Container equipment  depreciable lives and residual values
    
    Container equipment  recoverability and valuation in accordance with SFAS 144
Accounting for the Impairment or Disposal of Long Lived Assets
    
    Allowance for doubtful accounts
  Inflation
  16




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The Cronos Group
   
 Quantitative and Qualitative Disclosures About Market Risk
 Exchange rate risk
 
 Controls and Procedures
   
 Controls and Procedures
  17




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PART II  OTHER INFORMATION
 
 Legal Proceedings
  
 Risk Factors
  
 Unregistered Sales of Equity Securities and Use of Proceeds
  
 Defaults Upon Senior Securities
  
 Submissions of Matters to a Vote of Securities Holders
  
 Other Information
  
 Exhibits
  ExhibitNo.
    
    Description
    
    Method of Filing3(a)
    
    Limited Partnership Agreement, amended
and restated as of December 28, 1995
    
    *3(b)
    
    Certificate of Limited Partnership
    
    **10
    
    Form of Leasing Agent Agreement with
Cronos Containers Limited
    
    ***31.1
    
    Rule 13a-14 Certification
    
    Filed with this document31.2
    
    Rule 13a-14 Certification
    
    Filed with this document32
    
    Section 1350 Certification
    
    Filed with this document****
 
 *
    
    Incorporated by reference to Exhibit A to the Prospectus of the Partnership dated December
28, 1995, included as part of Registration Statement on Form S-1 (No. 33-98290)**
    
    Incorporated by reference to Exhibit 3.2 to the Registration Statement on Form S-1 (No.
33-98290)***
    
    Incorporated by reference to Exhibit 10.2 to the Registration Statement on Form S-1 (No.
33-98290)****
    
    This certification, required by Section 906 of the Sarbanes-Oxley Act of 2002, other than as
required by Section 906, is not to be deemed filed with the Commission or subject to the
rules and regulations
promulgated by the Commission under the Securities Exchange Act of 1934, as amended, or to the
liabilities of Section 18 of said Act. 18




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SIGNATURES
  CRONOS GLOBAL INCOME FUND XVI, L.P.By
    
    Cronos Capital Corp.The General PartnerBy
    
    /s/ Dennis J. TietzDennis J. TietzPresident and Director of
Cronos Capital Corp. (CCC)
Principal Executive Officer of CCCBy
    
    /s/ John KallasJohn KallasChief Financial Officer and
Director of Cronos Capital Corp. (CCC)
Principal Financial and Accounting Officer of CCCDate: May 11, 2007
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EXHIBIT INDEX
 ExhibitNo.
    
    Description
    
    Method of Filing3(a)
    
    Limited Partnership Agreement, amended
and restated as of December 28, 1995
    
    *3(b)
    
    Certificate of Limited Partnership
    
    **10
    
    Form of Leasing Agent Agreement with Cronos Containers Limited
    
    ***31.1
    
    Rule 13a-14 Certification
    
    Filed with this document31.2
    
    Rule 13a-14 Certification
    
    Filed with this document32
    
    Section 1350 Certification
    
    Filed with this document
****
 
 *
    
    Incorporated by reference to Exhibit A to the Prospectus of the Partnership dated December
28, 1995, included as part of Registration Statement on Form S-1 (No. 33-98290)**
    
    Incorporated by reference to Exhibit 3.2 to the Registration Statement on Form S-1 (No.
33-98290)***
    
    Incorporated by reference to Exhibit 10.2 to the Registration Statement on Form S-1 (No.
33-98290)****
    
    This certification, required by Section 906 of the Sarbanes-Oxley Act of 2002, other than as
required by Section 906, is not deemed to be filed with the Commission or subject to the
rules and regulations promulgated by the Commission under the Securities Exchange Act of 1934,
as amended, or to the liabilities of Section 18 of said Act.