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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, 2005
 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 0-23158 CRONOS GLOBAL INCOME FUND XIV, L.P.  California
(State or other jurisdiction of
incorporation or organization)
    
    94-3163375
(I.R.S. Employer
Identification No.)
 One Front Street, Suite 925, San Francisco, California 94111  (415) 677-8990
(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 þ. No o. Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of
the Exchange Act). Yes o. No þ.




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CRONOS GLOBAL INCOME FUND XIV, L.P. Report on Form 10-Q for the Quarterly Period
Ended March 31, 2005 TABLE OF CONTENTS  
 PAGE PART I  FINANCIAL INFORMATION
    
    
    3Item 1. Financial Statements
    
    
    3Condensed Balance Sheets  March 31, 2005 and December 31, 2004 (unaudited)
    
    
    4Condensed Statements of Operations for the three months ended March 31, 2005 and 2004 (unaudited)
    
    
    5Condensed Statements of Cash Flows for the three months ended March 31, 2005 and 2004 (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
    
    
    16Item 4. Controls and Procedures
    
    
    16PART II  OTHER INFORMATION
    
    
    17Item 1. Legal Proceedings
    
    
    17Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    17Item 3. Defaults Upon Senior Securities
    
    
    17Item 4. Submissions of Matters to a Vote of Securities Holders
    
    
    17Item 5. Other Information
    
    
    17Item 6. Exhibits
    
    
    17EXHIBIT 31.1EXHIBIT 31.2EXHIBIT 32
 2




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PART I  FINANCIAL INFORMATION 
 Item 1. Financial Statements Presented herein are Cronos Global Income XIV, L.P.s (the Partnership) condensed balance
sheets as of March 31, 2005 and December 31, 2004, condensed statements of operations for
the three months ended March 31, 2005 and 2004, and condensed statements of cash flows for
the three months ended March 31, 2005 and 2004, (collectively the Financial Statements)
prepared by the Partnership without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission (SEC). Certain information and footnote disclosures
normally included in financial statements prepared in accordance with accounting principles
generally accepted in the United States have been condensed or omitted pursuant to such
rules and regulations, although the Partnership believes that the disclosures are adequate
to make the information present not misleading. It is suggested that these Financial
Statements be read in conjunction with the financial statements and the notes thereto
included in the Partnerships December 31, 2004 Annual Report on Form 10-K. These
Financial Statements reflect, in the opinion of the Partnership and Cronos Capital Corp.
(CCC), the general partner, all adjustments (consisting only of normal recurring
adjustments) necessary to present fairly the results for the interim periods. The
statements of operations for such interim periods are not necessarily indicative of the
results for the full year. The information in this Quarterly Report on Form 10-Q contains certain forward-looking
statements within the meaning of the securities laws. These forward-looking statements
reflect the current view of the Partnership with respect to future events and financial
performance and are subject to a number of risks and uncertainties, many of which are
beyond the Partnerships control. All statements, other than statements of historical
facts included in this report, including the statements under Managements Discussion and
Analysis of Financial Condition and Results of Operations, regarding the Partnerships
strategy, future operations, financial position, estimated revenues, projected costs,
prospects, plans and objectives of the Partnership are forward-looking statements. When
used in this report, the words will, believe, anticipate, intend, estimate,
expect, project, and similar expressions are intended to identify forward-looking
statements, although not all forward-looking statements contain these identifying words.
All forward-looking statements speak only as of the date of this report. The Partnership
does not undertake any obligation to update or revise publicly any forward-looking
statements, whether as a result of new information, future events or otherwise. Although
the Partnership believes that its plans, intentions and expectations reflected in or
suggested by the forward-looking statements made in this report are reasonable, the
Partnership can give no assurance that these plans, intentions or expectations will be
achieved. Future economic and industry trends that could potentially impact revenues and
profitability are difficult to predict. 3




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CRONOS GLOBAL INCOME FUND XIV, L.P. 
 Condensed Balance Sheets (Unaudited) March 31,
    
    
    December 31,2005
    
    
    2004AssetsCurrent assets:Cash and cash equivalents, includes $1,865,458 at March 31, 2005 and
$2,220,887 at December 31, 2004 in interest-bearing accounts
    
    $
    1,880,392
    
    
    $
    2,235,887Net lease receivables due from Leasing Company
(notes 1 and 2)
    
    
    545,342
    
    
    
    453,718Total current assets
    
    
    2,425,734
    
    
    
    2,689,605Container rental equipment, at cost
    
    
    31,679,040
    
    
    
    33,635,401Less accumulated depreciation
    
    
    (21,631,573
    )
    
    
    (22,495,935
    )Net container rental equipment (note 1)
    
    
    10,047,467
    
    
    
    11,139,466Total assets
    
    $
    12,473,201
    
    
    $
    13,829,071Partners CapitalPartners capital (deficit):General partner
    
    $
    (477,028
    )
    
    $
    (463,125
    )Limited partners
    
    
    12,950,229
    
    
    
    14,292,196Total partners capital
    
    $
    12,473,201
    
    
    $
    13,829,071
 The accompanying notes are an integral part of these financial statements. 4




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CRONOS GLOBAL INCOME FUND XIV, L.P. 
 Condensed Statements of Operations (Unaudited) Three Months EndedMarch 31,
    
    
    March 31,2005
    
    
    2004Net lease revenue (notes 1 and 3)
    
    $
    671,832
    
    
    $
    652,402Other operating expenses:Depreciation
    
    
    (512,626
    )
    
    
    (597,816
    )Other general and administrative expenses
    
    
    (29,928
    )
    
    
    (27,879
    )Net loss on disposal of equipment
    
    
    (77,109
    )
    
    
    (63,300
    )619,663
    
    
    
    (688,895
    )Income (loss) from operations
    
    
    52,169
    
    
    
    (36,593
    )Other income:Interest income
    
    
    8,491
    
    
    
    987Net income (loss)
    
    $
    60,660
    
    
    $
    (35,606
    )Allocation of net income (loss):General partner
    
    $
    34,817
    
    
    $
    25,043Limited partners
    
    
    25,843
    
    
    
    (60,649
    )$
    60,660
    
    
    $
    (35,606
    )Limited partners per unit share of net income (loss)
    
    $
    0.01
    
    
    $
    (0.02
    )
 The accompanying notes are an integral part of these financial statements. 5




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CRONOS GLOBAL INCOME FUND XIV, L.P. 
 Condensed Statements of Cash Flows (Unaudited) Three Months EndedMarch 31,
    
    
    March 31,2005
    
    
    2004Net cash provided by operating activities
    
    $
    552,463
    
    
    $
    696,273Cash provided by investing activities:Proceeds from disposal of equipment
    
    
    508,573
    
    
    
    185,101Cash used in financing activities:Distribution to general partner
    
    
    (48,722
    )
    
    
    (34,833
    )Distribution to limited partners
    
    
    (1,367,809
    )
    
    
    (882,857
    )(1,416,531
    )
    
    
    (917,690
    )Net decrease in cash and cash equivalents
    
    
    (355,495
    )
    
    
    (36,316
    )Cash and cash equivalents at the beginning of the period
    
    
    2,235,887
    
    
    
    1,647,319Cash and cash equivalents at the end of the period
    
    $
    1,880,392
    
    
    $
    1,611,003
 The accompanying notes are an integral part of these financial statements. 6




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CRONOS GLOBAL INCOME FUND XIV, L.P. 
 Notes to Unaudited Condensed Financial Statements  (1)
    Summary of Significant Accounting Policies  (a)
    Nature of OperationsCronos Global Income Fund XIV, L.P. (the Partnership) is a limited partnership organized
under the laws of the State of California on July 30, 1992, for the purpose of owning and
leasing marine cargo containers worldwide to ocean carriers. The Partnerships operations
are subject to the fluctuations of world economic and political conditions. The
Partnership believes that the profitability of, and risks associated with, leases to
foreign customers is generally the same as those of leases to domestic customers. The
Partnerships leases generally require all payments to be made in United States currency.Cronos Capital Corp. (CCC) is the general partner and, with its affiliate Cronos
Containers Limited (the Leasing Company), manages the business of the Partnership. CCC
and the Leasing Company also manage the container leasing business for other partnerships
affiliated with CCC.The Partnership commenced operations on January 29, 1993 when the minimum subscription
proceeds of $2,000,000 were obtained. The Partnership offered 4,250,000 units of limited
partnership interests at $20 per unit, or $85,000,000. The offering terminated on November
30, 1993, at which time 2,984,309 limited partnership units had been sold.The decision to dispose of containers is influenced by various factors including age,
condition, suitability for continued leasing as well as the geographical location when
disposed. At that time whereby the Partnerships fleet size is reduced to approximately 20%
of its original fleet size, the Partnership expects to enter the final phase of its
liquidation and wind-up stage of operations, unless terminated sooner upon the occurrence
of certain events. At March 31, 2005, the Partnerships fleet size was approximately 65%
of its original fleet size.(b)
    Leasing Company and Leasing Agent AgreementA Leasing Agent Agreement exists between the Partnership and the Leasing Company,
whereby the Leasing Company has the responsibility to manage the leasing operations of all
equipment owned by the Partnership. Pursuant to the Agreement, the Leasing Company is
responsible for leasing, managing and re-leasing the Partnerships containers to ocean
carriers, and has full discretion over which ocean carriers and suppliers of goods and
services it may deal with. The Leasing Agent Agreement permits the Leasing Company to use
the containers owned by the Partnership, together with other containers owned or managed by
the Leasing Company and its affiliates, as part of a single fleet operated without regard
to ownership. Since the Leasing Agent Agreement meets the definition of an operating lease
in Statement of Financial Accounting Standards (SFAS) No. 13, it is accounted for as a
lease under which the Partnership is lessor and the Leasing Company is lessee. (Continued) 7




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CRONOS GLOBAL INCOME FUND XIV, L.P. Notes to Unaudited Condensed Financial Statements  (b)
    Leasing Company and Leasing Agent AgreementThe Leasing Agent Agreement generally provides that the Leasing Company will make
payments to the Partnership based upon rentals collected from ocean carriers after
deducting direct operating expenses and management fees to CCC and the Leasing Company.
The Leasing Company leases containers to ocean carriers, generally under operating leases
which are either master leases or term leases (mostly one to five years). Master leases do
not specify the exact number of containers to be leased or the term that each container
will remain on hire but allow the ocean carrier to pick up and drop off containers at
various locations, and rentals are based upon the number of containers used and the
applicable per-diem rate. Accordingly, rentals under master leases are all variable and
contingent upon the number of containers used. Most containers are leased to ocean
carriers under master leases; leasing agreements with fixed payment terms are not material
to the financial statements. Since there are no material minimum lease rentals, no
disclosure of minimum lease rentals is provided in these financial statements.(c)
    Basis of AccountingThe Partnership utilizes the accrual method of accounting. Net lease revenue is
recorded by the Partnership in each period based upon its leasing agent agreement with the
Leasing Company. Net lease revenue is generally dependent upon operating lease rentals
from operating lease agreements between the Leasing Company and its various lessees, less
direct operating expenses and management fees due in respect of the containers specified in
each operating lease agreement.(d)
    Use of EstimatesThe financial statements are prepared in conformity with accounting principles
generally accepted in the United States of America (GAAP), which requires the Partnership
to make estimates and assumptions that affect the reported amounts of assets and
liabilities and disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during the reported
period. Actual results could differ from those estimates.The most significant estimates included within the financial statements are the container
rental equipment estimated useful lives and residual values, and the estimate of future
cash flows from container rental equipment operations, used to determine the carrying value
of container rental equipment in accordance with SFAS No. 144. Considerable judgment is
required in estimating future cash flows from container rental equipment operations.
Accordingly, the estimates may not be indicative of the amounts that may be realized in
future periods. As additional information becomes available in subsequent periods,
recognition of an impairment of the container rental equipment carrying values may be
necessary based upon changes in market and economic conditions. (Continued) 8




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CRONOS GLOBAL INCOME FUND XIV, L.P. Notes to Unaudited Condensed Financial Statements  (e)
    Container Rental EquipmentIn accordance with SFAS No. 144, Accounting for the Impairment or Disposal of
Long-Lived Assets, container rental equipment is considered to be impaired if the carrying
value of the asset exceeds the expected future cash flows from related operations
(undiscounted and without interest charges). If impairment is deemed to exist, the assets
are written down to fair value. An analysis is prepared each quarter projecting future
cash flows from container rental equipment operations. Current and projected utilization
rates, per-diem rental rates, direct operating expenses, fleet size and container disposals
are the primary variables utilized by the analysis. Additionally, the Partnership
evaluates future cash flows and potential impairment by container type rather than for each
individual container, and as a result, future losses could result for individual container
dispositions due to various factors, including age, condition, suitability for continued
leasing, as well as the geographical location of containers when disposed. There were no
impairment charges to the carrying value of container rental equipment for the three-month
periods ended March 31, 2005 and 2004.Depreciation policies are also evaluated to determine whether subsequent events and
circumstances warrant revised estimates of useful lives. Container rental equipment is
depreciated using the straight-line basis.(f)
    Partners Capital AccountsUpon dissolution , the assets of the Partnership will be sold and the proceeds thereof
distributed as follows: (i) all of the Partnerships debts and liabilities to persons
other than CCC or the limited partners shall be paid and discharged; (ii) all of the
Partnerships debts and liabilities to CCC and the limited partners shall be paid and
discharged; and (iii) the balance of such proceeds shall be distributed to CCC and the
limited partners in accordance with the positive balances of CCC and the limited partners
capital accounts. CCC shall contribute to the Partnership an amount equal to the deficit
balance in its capital account at the time of such liquidation, after giving effect to the
allocation of income or loss arising from the liquidation of the Partnerships assets.(g)
    Financial Statement PresentationThese financial statements have been prepared without audit pursuant to the rules and
regulations of the Securities and Exchange Commission. Certain information and footnote
disclosures normally included in financial statements prepared in accordance with
accounting principles generally accepted in the United States of America (GAAP) have been
condensed or omitted pursuant to such rules and regulations, although the Partnership
believes that the disclosures are adequate to make the information presented not
misleading. It is suggested that these financial statements be read in conjunction with
the financial statements and accompanying notes in the Partnerships December 31, 2004
Annual Report on Form 10-K.The interim financial statements presented herewith reflect in the opinion of
management, all adjustments of a normal recurring necessary to present fairly the results
for the interim periods presented. The results of operations for such interim periods are
not necessarily indicative of the results to be expected for the full year. (Continued) 9




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CRONOS GLOBAL INCOME FUND XIV, L.P. Notes to Unaudited Condensed Financial Statements  (2)
    Net Lease Receivables Due from Leasing CompanyNet lease receivables due from the Leasing Company are determined by deducting direct operating
payables and accrued expenses, base management fees payable, and reimbursed administrative
expenses payable to CCC and its affiliates from the rental billings earned by the Leasing
Company under operating leases to ocean carriers for the containers owned by the Partnership,
as well as proceeds earned from container disposals. Net lease receivables at March 31, 2005
and December 31, 2004 were as follows: March 31,
    
    
    December 31,2005
    
    
    2004Gross lease receivables
    
    $
    1,019,416
    
    
    $
    1,025,167Less:Direct operating payables and accrued expenses
    
    
    (208,293
    )
    
    
    (278,630
    )Damage protection reserve
    
    
    (96,552
    )
    
    
    (115,519
    )Base management fees payable
    
    
    (10,151
    )
    
    
    (28,880
    )Reimbursed administrative expenses
    
    
    (16,459
    )
    
    
    (19,554
    )Allowance for doubtful accounts
    
    
    (142,620
    )
    
    
    (128,866
    )474,075
    
    
    
    571,449Net lease receivables
    
    $
    545,341
    
    
    $
    453,718
  (3)
    Net Lease RevenueNet lease revenue is determined by deducting direct operating expenses, base management fees
and reimbursed administrative expenses to CCC and its affiliates from the rental revenue earned
by the Leasing Company under operating leases to ocean carriers for the containers owned by the
Partnership. Net lease revenue for the three-month periods ended March 31, 2005 and 2004 were
as follows: Three Months EndedMarch 31,
    
    
    March 31,2005
    
    
    2004Rental revenue (note 4)
    
    $
    889,826
    
    
    $
    1,050,044Less:Rental equipment operating expenses
    
    
    101,910
    
    
    
    262,294Base management fees
    
    
    60,927
    
    
    
    73,325Reimbursed administrative expensesSalaries
    
    
    37,882
    
    
    
    44,460Other payroll related expenses
    
    
    7,403
    
    
    
    3,956General and administrative expenses
    
    
    9,872
    
    
    
    13,607217,994
    
    
    
    397,642Net lease revenue
    
    $
    671,832
    
    
    $
    652,402
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CRONOS GLOBAL INCOME FUND XIV, L.P. Notes to Unaudited Condensed Financial Statements  (4)
    Operating SegmentAn operating segment is a component of an enterprise that engages in business activities from
which it may earn revenues and incur expenses, whose operating results are regularly reviewed
by the enterprises chief operating decision maker to make decisions about resources to be
allocated to the segment and assess its performance, and about which separate financial
information is available. CCC and the Leasing Company operate the Partnerships container
fleet as a homogenous unit and have determined that as such it has a single reportable
operating segment.The Partnership derives its revenues from dry cargo and refrigerated containers used by its
customers in global trade routes. As of March 31, 2005, the Partnership operated 5,781
twenty-foot, 2,320 forty-foot and 170 forty-foot high-cube marine dry cargo containers, as well
as 359 twenty-foot and 59 forty-foot marine refrigerated cargo containers. A summary of gross
lease revenue, by product, for the three-month periods ended March 31, 2005 and 2004 follows: Three Months EndedMarch 31,
    
    
    March 31,2005
    
    
    2004Dry cargo containers
    
    $
    654,225
    
    
    $
    705,234Refrigerated containers
    
    
    235,601
    
    
    
    344,810Total
    
    $
    889,826
    
    
    $
    1,050,044
  Due to the Partnerships lack of information regarding the physical location of its fleet
of containers when on lease in the global shipping trade, the Partnership believes that it does
not possess discernible geographic reporting segments as defined in SFAS No. 131 (SFAS 131),
Disclosures about Segments of an Enterprise and Related Information. 11




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Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations The following discussion of the Partnerships historical financial condition and results of
operations should be read in conjunction with the Partnerships December 31, 2004 Annual Report on
Form 10-K and the financial statements and the notes thereto appearing elsewhere in this report. Market Overview The Partnerships operating results for the first quarter of 2005 improved over the
corresponding period in 2004, as market conditions were favorable in comparison to those that
existed during the three months ended March 31, 2004, and consistent with those that existed at the
end of 2004. The first quarter 2005 results were contrary to historical trends, whereby
container-leasing companies have traditionally experienced reductions in demand during the first
quarter of the year, as shipping lines reduce their activity during the Lunar New Year holiday. As
a result, the Partnerships dry cargo container utilization remained at a historically high level,
measuring 94% at March 31, 2005, compared to 95% at December 31, 2004. Also contributing to the
Partnerships high levels of utilization and favorable performance was the continued disposal of
the Partnerships off-hire containers, in accordance with one of its original investment
objectives, realizing the residual value of its containers after the expiration of their economic
useful lives, estimated to be between 12 and 15 years after placement in lease service. Although conditions for the container leasing market were favorable during the first quarter
of 2005, global economic reports for this period indicate that, with the exception of China,
consumer spending and economic growth rates have declined from the robust levels experienced in
Europe, the US and many of the other developed countries during 2004. The decline in these
economic growth rates are a direct result of rising fuel costs, combined with a generally weak US
dollar, a soaring US trade deficit, higher interest rates and Europes languishing economies.
Economists opinions vary as to whether the recent declines in these growth rates during the first
quarter of 2005 are temporary or an indicator of slower global economic growth for the remainder of
2005. CCC and the Leasing Company do not expect a significant decline in the Partnerships
utilization rates in the near future. However, further declines in these economic growth rates
during 2005 may contribute to a weakening in container leasing market conditions and lower levels
of demand for new and existing containers. In the long term, industry experts believe the future
of the container shipping industry is favorable, as the level of outsourcing to China and other
parts of Asia increase, previously restrictive trade agreements expire, new trade agreements are
negotiated, and China enters global markets in which it previously played a small role. The price of a new dry cargo container increased from $2,200 at the end of 2004 to
approximately $2,250 at the end of March 2005, as the demand for new containers remained strong and
the cost of container raw materials such as steel and wood flooring remained at high levels.
Manufacturers indicate that there is unlikely to be a major reduction in the price of new
containers in the near term due to the increase in raw material prices. Although container prices
may fluctuate over the remainder of 2005, the long-term outlook for container prices continues to
show an inflationary bias tied to energy costs, steel prices and interest rates. These higher
prices have forced some shipping lines, as well as leasing companies, to reconsider capital
expenditure levels for new container investment during the 2005 year. A reduction in new container
capital expenditures by the shipping lines could result in the shipping lines leasing more
containers from the leasing companies, including the Partnerships containers. Ports, railroads and inland transportation systems, particularly in the US and Europe,
continue to experience congestion arising from the higher trade volumes experienced in recent
years, thereby, increasing the turnaround time for containerships and reducing the available supply
of containers. Port congestion in many locations has been attributable to underestimating the
growth in containerized cargo activity over the last few years, delays in expanding existing
facilities and in planning new facilities due to environmental concerns, and the implementation of
larger containerships. Expansion of the worlds ports and terminals is considered to be the key to
relieving the congestion currently experienced, as further efficiency gains are not expected to
create significant increases in port and terminal capacity. During the three-month period ending March 31, 2005, inventory levels of off-hire containers
remained at low levels, as shipping lines employed a larger quantity of leased containers to meet
their containerized cargo requirements. The declines in inventory levels have resulted in
substantial decreases in storage and other inventory related operating expenses. A significant
increase in container inventories in future periods may contribute to increases in storage expenses
and expenditures to reposition containers from low demand locations to locations of higher demand.
The Leasing Company has not undertaken any major 12




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repositioning of the Partnerships containers since the first quarter of 2004, due primarily
to the shortage of containership capacity. If suitable carriers can be sourced, the Leasing
Company will reposition off-hire containers from the US East Coast during 2005, thereby taking
advantage of the strong demand for containers in the Asian trade routes. This repositioning may
include the Partnerships containers. The objective of each repositioning is to improve future
cash flows so that savings in storage expense, combined with an increase in future lease revenue,
exceed the cost of repositioning the containers. Sales proceeds realized on the sale of used containers remained favorable during the first
quarter of 2005, as fewer containers were available to meet the demand of buyers. A significant
increase in inventory levels in future periods could adversely impact sales proceeds realized on
the sale of containers. The Leasing Company, on behalf of the Partnership, may consider the
disposal of the Partnerships off-hire containers in locations whereby container sale prices equal
or exceed targets established by both CCC and the Leasing Company. The Partnerships average dry cargo container per-diem rate for the three-month period ending
March 31, 2005 increased approximately 3% in comparison to the same period in the prior year.
Per-diem rates for older containers are expected to maintain their current level for the remainder
of 2005. Although favorable market conditions currently exist for container lessors, recent declines in
spending and economic growth rates may negatively impact the shipping lines in future periods.
Sharply rising and volatile oil prices, combined with the increase in charter rates for ships,
chronic port congestion, higher steel prices and the related increase in new container prices, have
created a concern for both the shipping lines and, therefore, the leasing companies. Although the
majority of the top 20 shipping lines have experienced strong profit growth during 2004, other
shipping lines are facing increased financial pressures, especially those shipping lines that rely
on operating their containerships via short-term charters. Current conditions appear to favor the
larger more established shipping lines, which have witnessed increases in freight rates due to the
strong demand experienced in their respective trade routes. However, some regional intra-Asian
shipping lines have struggled to remain profitable, due primarily to the rising charter rates for
ships, over capacity and lower freight rates, and have cut back services in certain routes in an
attempt to reduce rising costs. The increased trade volumes of recent years have contributed to shortages of both
containerships and tonnage capacity. As a result, shipping lines have embarked on a major new
shipbuilding program. Industry analysts are expressing concern that the current program of new
shipbuilding may create over capacity within the shipping industry once the new container ships
scheduled for delivery during 2006 and 2007 are placed in service. Based on current orders,
industry analysts predict that the worlds containership fleet will exceed 10 million TEU by the
end of 2007, compared to less than 7 million TEU at the beginning of 2004. Over capacity may
contribute to lower charter and freight rates as shippers take advantage of the capacity surplus
created by the additional container ships. These changes may result in a reduction in
profitability for shipping lines, which in turn could have adverse implications for container
lessors, including a decline in the demand for leased containers and a reduction in container
per-diem rental rates. The financial impact of losses from shipping lines may eventually influence
the demand for leased containers, as some shipping lines may experience additional financial
difficulties, consolidate, or become insolvent. The Partnership, CCC and the Leasing Company
continue to monitor the aging of lease receivables, collections and the credit exposure to various
existing and new customers. Results of Operations Pursuant to the Limited Partnership Agreement of the Partnership, all authority to administer
the business of the Partnership is vested in CCC. A Leasing Agent Agreement exists between CCC and
the Leasing Company, whereby the Leasing Company has the responsibility to manage the leasing
operations of all equipment owned by the Partnership. Pursuant to the Agreement, the Leasing
Company is responsible for leasing, managing and re-leasing the Partnerships containers to ocean
carriers and has full discretion over which ocean carriers and suppliers of goods and services it
may deal with. The Leasing Agent Agreement permits the Leasing Company to use the containers owned
by the Partnership, together with other containers owned or managed by the Leasing Company and its
affiliates, as part of a single fleet operated without regard to ownership. The primary component of the Partnerships results of operations is net lease revenue. Net
lease revenue is determined by deducting direct operating expenses, management fees and reimbursed
administrative expenses from gross lease revenues billed by the Leasing Company from the leasing of
the Partnerships containers. Net lease revenue is directly related to the size, utilization 13




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##### Table of Contents



and per-diem rental rates of the Partnerships fleet. Direct operating expenses are direct
costs associated with the Partnerships containers. Direct operating expenses may be categorized
as follows:  
    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. At March 31, 2005, approximately 65% of the original equipment remained in the Partnerships
fleet, as compared to approximately 67% at December 31, 2004. The following table summarizes the
composition of the Partnerships fleet (based on container type) at March 31, 2005. Dry Cargo
    
    
    RefrigeratedContainers
    
    
    Containers40-Foot20-Foot
    
    
    40-Foot
    
    
    High-Cube
    
    
    20-Foot
    
    
    40-FootContainers on lease:Master lease
    
    
    3,543
    
    
    
    1,108
    
    
    
    108
    
    
    
    271
    
    
    
    15Term leaseShort term1
    
    
    914
    
    
    
    460
    
    
    
    34
    
    
    
    31
    
    
    
    39Long term2
    
    
    1,118
    
    
    
    537
    
    
    
    14
    
    
    
    
    
    
    
    Subtotal
    
    
    5,575
    
    
    
    2,105
    
    
    
    156
    
    
    
    302
    
    
    
    56Containers off lease
    
    
    206
    
    
    
    215
    
    
    
    14
    
    
    
    57
    
    
    
    3Total container fleet
    
    
    5,781
    
    
    
    2,320
    
    
    
    170
    
    
    
    359
    
    
    
    59
 Dry Cargo
    
    
    RefrigeratedContainers
    
    
    Containers40-Foot20-Foot
    
    
    40-Foot
    
    
    High-Cube
    
    
    20-Foot
    
    
    40-FootUnits
    
    
    %
    
    
    Units
    
    
    %
    
    
    Units
    
    
    %
    
    
    Units
    
    
    %
    
    
    Units
    
    
    %Total purchases
    
    
    8,778
    
    
    
    100
    %
    
    
    3,612
    
    
    
    100
    %
    
    
    216
    
    
    
    100
    %
    
    
    511
    
    
    
    100
    %
    
    
    350
    
    
    
    100
    %Less disposals
    
    
    2,997
    
    
    
    34
    %
    
    
    1,292
    
    
    
    36
    %
    
    
    46
    
    
    
    21
    %
    
    
    152
    
    
    
    30
    %
    
    
    291
    
    
    
    83
    %Remaining fleet at March 31, 2005
    
    
    5,781
    
    
    
    66
    %
    
    
    2,320
    
    
    
    64
    %
    
    
    170
    
    
    
    79
    %
    
    
    359
    
    
    
    70
    %
    
    
    59
    
    
    
    17
    %
   1.
    
    Short term leases represent term leases that are either scheduled for renegotiation or that
may expire on or before March 2006.2.
    
    Long term leases represent term leases, the majority of which will expire between April 2006
and December 2009. Three Months Ended March 31, 2005 Compared to the Three Months Ended March 31, 2004 Net lease revenuewas $671,832 for the three months ended March 31, 2005 compared to $652,402 for
the same period in the prior year. The increase was due to a $160,384 decrease in rental equipment
operating expenses, as well as a $19,264 decline in other components of net lease revenue,
including management and reimbursable administrative expenses. These expenses were partially
offset by a $160,218 decline in gross rental revenue for the three-month period ended March 31,
2005, compared to the same period in the prior year. Gross rental revenue was impacted by the
Partnerships smaller fleet size, partially offset by a 3% increase in the average dry cargo
per-diem rental rate, a 1% increase in the average refrigerated container per diem rental rate and
an increase in fleet utilization rates, when compared to the same three-month period in the prior
year. The Partnerships average fleet size and utilization rates for the three-month periods ended
March 31, 2005 and 2004 were as follows: Three Months EndedMarch 31, 2005
    
    
    March 31, 2004Fleet size (measured in twenty-foot equivalent units (TEU))Dry cargo containers
    
    
    10,977
    
    
    
    12,668Refrigerated containers
    
    
    509
    
    
    
    798Average utilization ratesDry cargo containers
    
    
    95
    %
    
    
    85
    %Refrigerated containers
    
    
    86
    %
    
    
    85
    %
 14




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##### Table of Contents



The decrease in rental equipment operating expenses was attributable to the Partnerships
higher combined utilization rate in the three-month period ended March 31, 2005, compared to the
same period in the prior year. This impacted inventory related expenses such as storage and
repositioning costs, and activity related expenses such as repair and maintenance. Depreciation expenseof $512,626 for the three months ended March 31, 2005 declined by $85,190
when compared to the corresponding period in 2004, a direct result of the Partnerships aging and
declining fleet size. Other general and administrative expensesamounted to $29,928 for the three month period ended
March 31, 2005, an increase of $2,048 or 7% when compared to the same period in 2004. Net less on disposal of equipmentfor the three months ended March 31, 2005 was $77,109, as
compared to a net loss of $63,300 for the corresponding period in 2004. The Partnership disposed
of 352 containers, as compared to 225 containers during the same three-month period in 2004. The
Partnership believes that the net loss on container disposals in the three-month period ended March
31, 2005, was a result of various factors, including the volume of disposed containers, the age,
condition, suitability for continued leasing, as well as the geographical location of the
containers when disposed. These factors will continue to influence the amount of sales proceeds
received and the related gain or loss on container disposals. The level of the Partnerships container disposals in subsequent periods, as well as the price
of steel, new container prices and the current leasing markets impact on sales prices for existing
older containers such as those owned by the Partnership, will also contribute to fluctuations in
the net gain or loss on disposals. There were no reductions to the carrying value of container
rental equipment due to impairment during the three-month periods ended March 31, 2005 and 2004. Liquidity and Capital Resources The Partnerships primary objective is to generate cash flow from operations for distribution
to its limited partners. Aside from the initial working capital reserve retained from gross
subscription proceeds (equal to approximately 1% of such proceeds), the Partnership relies
primarily on container rental receipts to meet this objective, as well as to finance operating
needs. Cash generated from container sales proceeds are distributed to its limited partners. No
credit lines are maintained to finance working capital. Commencing in 2003, the Partnerships 11th
year of operations, the Partnership began focusing its attention on the disposition of its fleet in
accordance with another of its original investment objectives, realizing the residual value of its
containers after the expiration of their economic useful lives, estimated to be between 12 to 15
years after placement in leased service. Since that time, the Partnership has been actively
disposing of its fleet, with cash proceeds from equipment disposals, in addition to cash from
operations, providing the cash flow for distributions to the limited partners. The decision to
dispose of containers is influenced by various factors including age, condition, suitability for
continued leasing as well as the geographical location when disposed. At that time whereby the
Partnerships fleet size is reduced to approximately 20% of its original fleet size, the
Partnership expects to enter the final phase of its liquidation and wind up of its operations,
unless terminated sooner upon the occurrence of certain events. At March 31, 2005, the
Partnerships fleet size measured approximately 65% of its original fleet size. Upon the
liquidation of CCCs interest in the Partnership, CCC shall contribute to the Partnership an
aggregate amount equal to the deficit balance in its capital account at the time of such
liquidation, after giving effect to the allocation of income or loss arising from the liquidation
of the Partnerships assets. Distributions are paid monthly, based primarily on each quarters cash flow from operations.
Monthly distributions are also affected by periodic increases or decreases to working capital
reserves, as deemed appropriate by the general partner. Sales proceeds distributed to its partners
may fluctuate in subsequent periods, reflecting the level of container disposals. At March 31, 2005, the Partnership had $1,880,392 in cash and cash equivalents, a decrease of
$355,495 from the cash balances at December 31, 2004. The Partnership invests its working capital,
as well as cash flows from operations and the sale of containers that have not yet been distributed
to CCC or its limited partners, in money market funds. Cash from Operating Activities: Net cash provided by operating activities, primarily generated
from the billing and collection of net lease revenue, was $552,463 during the three months ended
March 31, 2005, compared to $696,273 for the same three month period in 2004. 15




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##### Table of Contents



Cash from Investing Activities: Net cash provided by investing activities was $508,573 during
the three months ended March 31, 2005, compared to $185,101 in the corresponding period of 2004.
These amounts represent sales proceeds generated from the sale of container equipment and payment
received on the sales-type lease for the sale of rental equipment. Cash from Financing Activities: Net cash used in financing activities was $1,416,531 during
the three months ended March 31, 2005 compared to $917,690 during the three months ended March 31,
2004. These amounts represent distributions to the Partnerships general and limited partners.
The Partnerships continuing container disposals should produce lower operating results, and
consequently, lower distributions to its partners in subsequent periods. Critical Accounting Policies The Partnerships accounting policies are fundamental to understanding managements discussion and
analysis of results of operations and financial condition. The Partnership has identified three
policies as being significant because they require the Partnership to make subjective and/or
complex judgments about matters that are inherently uncertain. These policies include the
following:  
    Container equipment  depreciable lives
    Container equipment  valuation
    Allowance for doubtful accounts The Partnership, in consultation with its audit committee, has reviewed and approved these
significant accounting policies which are further described in the Partnerships 2004 Annual Report
on Form 10-K. Inflation The Partnership believes inflation has not had a material adverse effect on the results of its operations. 
 Item 3. Quantitative and Qualitative Disclosures About Market Risk Exchange rate risk:Substantially all of the Partnerships revenues are billed and paid in US
dollars and a significant portion of costs are billed and paid in US dollars. The Leasing Company
believes that the proportion of US dollar revenues may decrease in future years, reflecting a more
diversified customer base and lease portfolio. Of the non-US dollar direct operating expenses, the
majority are individually small, unpredictable and incurred in various denominations. Thus, the
Leasing Company determined such amounts are not suitable for cost effective hedging. As exchange
rates are outside of the control of the Partnership and Leasing Company, there can be no assurance
that such fluctuations will not adversely affect the Partnerships results of operations and
financial condition. 
 Item 4. Controls and Procedures The principal executive and principal financial officers of CCC have evaluated the disclosure
controls and procedures of the Partnership as of the end of the period covered by this quarterly
report. As used herein, the term disclosure controls and procedures has the meaning given to the
term by Rule 13a-15 under the Securities Exchange Act of 1934, as amended (Exchange Act), and
includes the controls and other procedures of the Partnership that are designed to ensure that
information required to be disclosed by the Partnership in the reports that it files with the SEC
under the Exchange Act is recorded, processed, summarized and reported within the time periods
specified in the SECs rules and forms. Based upon their evaluation, the principal executive and
principal financial officers of CCC have concluded that the Partnerships disclosure controls and
procedures were effective such that the information required to be disclosed by the Partnership in
this quarterly report is recorded, processed, summarized and reported within the time periods
specified in the SECs rules and forms applicable to the preparation of this report and is
accumulated and communicated to CCCs management, including CCCs principal executive officer and
principal financial officer, as appropriate to allow timely decisions regarding required
disclosures. There have been no significant changes in the Partnerships internal controls or in other factors
that could significantly affect the Partnerships internal controls subsequent to the evaluation
described above conducted by CCCs principal executive and financial officers. 16




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##### Table of Contents



PART II  OTHER INFORMATION 
 Item 1. Legal Proceedings Not applicable. 
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds Not applicable. 
 Item 3. Defaults Upon Senior Securities Not applicable. 
 Item 4. Submissions of Matters to a Vote of Securities Holders Not applicable. 
 Item 5. Other Information Not applicable. 
 Item 6. Exhibits  (a)
    Exhibits ExhibitNo.
    
    Description
    
    Method of Filing3(a)
    
    Limited Partnership Agreement, amended and
restated as of December 2, 1992
    
    *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
2, 1992, included as part of Registration Statement on Form S-1 (No. 33-51810)**
    
    Incorporated by reference to Exhibit 3.2 to the Registration Statement on Form S-1 (No.
33-51810)***
    
    Incorporated by reference to Exhibit 10.2 to the Registration Statement on Form S-1 (No.
33-51810)****
    
    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. 17




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##### Table of Contents



SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the Partnership has
duly caused this Report to be signed on its behalf by the undersigned thereunto duly authorized. CRONOS GLOBAL INCOME FUND XIV, 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 andDirector of Cronos Capital Corp. (CCC)
Principal Financial and Accounting Officer of CCCDate: May 13, 2005
 18




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##### Table of Contents



EXHIBIT INDEX ExhibitNo.
    
    Description
    
    Method of Filing3(a)
    
    Limited Partnership Agreement, amended and
restated as of December 2, 1992
    
    *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
2, 1992, included as part of Registration Statement on Form S-1 (No. 33-51810)**
    
    Incorporated by reference to Exhibit 3.2 to the Registration Statement on Form S-1 (No.
33-51810)***
    
    Incorporated by reference to Exhibit 10.2 to the Registration Statement on Form S-1 (No.
33-51810)****
    
    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.