Capital Product Partners L.P. Announces Third Quarter 2011 Financial Results and Reiterates Its Commitment to Its $0.93 per Unit Annual Distribution Guidance
The Partnership's net income for the quarter ended
Operating surplus for the quarter ended
Revenues for the third quarter of 2011 were
Total operating expenses for the third quarter of 2011 were
Net interest expense and finance cost for the third quarter of 2011 amounted to
As of
Merger Agreement Update
The Partnership announced on
Fleet Developments
As announced on
Following the commencement of the above charters, the Partnership's charter coverage of total fleet days is estimated at 64% for 2012.
Market Commentary
Overall, for most of the third quarter of 2011 the product tanker market saw softer spot rates, when compared to the previous quarter, due to weaker US gasoline imports and lack of arbitrage opportunities in the transatlantic market.
The period charter market remained robust with increased activity for both shorter and longer term employment.
The product tanker order book continued to experience substantial slippage during 2011, as approximately 60% of the expected
The crude tanker spot charter market for both VLCCs and Suezmaxes remained close or at historical lows mainly due to increased tonnage availability in most trading areas despite healthy fixture activity. The Suezmax market saw signs of improvement in September due to increased demand from European refineries and congestion in the Bosphorus Straits.
The crude tanker long term period market remained illiquid, as charterers' expectations for the short term spot market prospects remain negative and owners are unwilling to fix long term period charters at low levels.
The crude tanker orderbook continued to experience substantial slippage year to date, as approximately 27% of the expected crude tanker newbuilding deliveries for the year have not materialized. Industry analysts expect crude tanker orderbook slippage and cancellations to remain substantial going forward due to the depressed spot market, the weak shipping finance environment and downward pressure on asset values.
Quarterly Cash Distribution
On
Management Commentary
Mr.
"Moreover, following our recent announcement of the period fixtures for three of the five crude tanker vessels operating in the spot market at the time of the completion of the merger, the long term charter coverage of our fleet has improved. In line with our stated commitment to employ our vessels in the period charter market, thus offering cash flow visibility to our investors, we intend to fix the remaining two crude tanker vessels currently operating in the spot market in the coming months as opportunities arise, in order to eliminate the Partnership's remaining crude tanker spot market exposure.
"In addition to our fixtures of the three crude carriers we will have the opportunity to charter out a number of product tankers in the upcoming year, a period in which we expect charter rates to firm reflecting a more positive product tanker market environment.
"Given all of the above, we take this opportunity to reiterate our commitment to our annual distribution guidance of
Conference Call and Webcast
Today,
Conference Call details:
Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1(866) 819-7111 (from the US), 0(800) 953-0329 (from the
A replay of the conference call will be available until
Slides and audio webcast:
The slide presentation accompanying the conference call will be available on the Partnership's website at www.capitalpplp.com. An audio webcast of the call will also be accessible on the website. The relevant links will be found in the Investor Relations section of the website.
Forward-Looking Statements:
The statements in this press release that are not historical facts, including our expectations regarding the current and future employment of our vessels and their charters, timing during which we will charter our remaining two crude carrier vessels, expected fleet coverage for 2012, market and rate expectations and expectations regarding our quarterly distribution and annual distribution guidance may be forward-looking statements (as such term is defined in Section 21E of the Securities Exchange Act of 1934, as amended). These forward-looking statements involve risks and uncertainties that could cause the stated or forecasted results to be materially different from those anticipated. Unless required by law, we expressly disclaim any obligation to update or revise any of these forward-looking statements, whether because of future events, new information, a change in our views or expectations, to conform them to actual results or otherwise. We assume no responsibility for the accuracy and completeness of the forward-looking statements. We make no prediction or statement about the performance of our common units.
About
For more information about the Partnership, please visit our website: www.capitalpplp.com.
CPLP-F
Capital Product Partners L.P. Unaudited Condensed Consolidated Statements of Income (In thousands of United States Dollars, except number of units and earnings per unit) For the three-month period For the nine-month period ended September 30, ended September 30, 2011 2010 2011 2010 ------------ ------------ ------------ ------------ Revenues $ 22,797 $ 26,875 $ 66,706 $ 88,702 Revenues - related party 8,058 3,473 19,655 6,884 Total Revenues 30,855 30,348 86,361 95,586 Expenses: Voyage expenses 1,169 1,635 2,945 5,839 Vessel operating expenses - related party 7,889 7,896 22,792 22,322 Vessel operating expenses 735 - 814 1,034 General and administrative expenses 3,035 973 8,230 2,235 Depreciation 8,611 7,916 24,960 23,347 ------------ ------------ ------------ ------------ Operating income 9,416 11,928 26,620 40,809 ------------ ------------ ------------ ------------ Non operating income (expense), net: ------------ ------------ ------------ ------------ Gain from bargain purchase 65,927 - 82,453 - ------------ ------------ ------------ ------------ Other non operating income (expense), net: Interest expense and finance cost (8,158) (8,445) (24,627) (24,918) Gain on interest rate swap agreement 1,267 - 1,267 - Interest and other income 90 129 369 639 ------------ ------------ ------------ ------------ Total other non operating (expense), net (6,801) (8,316) (22,991) (24,279) ------------ ------------ ------------ ------------ Net income 68,542 3,612 86,082 16,530 ------------ ------------ ------------ ------------ Less: Net (income) attributable to CMTC operations - - - (983) ------------ ------------ ------------ ------------ Partnership's net income $ 68,542 $ 3,612 $ 86,082 $ 15,547 ------------ ------------ ------------ ------------General Partner's interest in Partnership's net income 1,371 72 1,722 311 Limited Partners' interest in Partnership's net income 67,171 3,540 84,360 15,236 Net income per: - Common units (basic and diluted) 1.50 0.10 2.07 0.49 Weighted-average units outstanding: - Common units (basic and diluted) 44,154,965 34,280,193 40,046,530 30,848,825Capital Product Partners L.P. Unaudited Condensed Consolidated Balance Sheets (In thousands of United States Dollars) As of As of September December Assets 30, 2011 31, 2010 Current assets Cash and cash equivalents $ 55,076 $ 32,471 Trade accounts receivable 10,576 2,305 Due from related parties 108 2 Prepayments and other assets 1,187 278 Inventory 9,877 83 ------------ ------------ Total current assets 76,824 35,139 ------------ ------------ Fixed assets Vessels, net 1,086,185 707,339 ------------ ------------ Total fixed assets 1,086,185 707,339 ------------ ------------ Other non-current assets Above market acquired charters 53,099 8,062 Deferred charges, net 2,095 2,462 Restricted cash 6,500 5,250 ------------ ------------ Total non-current assets 1,147,879 723,113 ------------ ------------ Total assets 1,224,703 $ 758,252 ------------ ------------ Liabilities and partners' capital Current liabilities Current portion of long-term debt 9,163 $ - Trade accounts payable 15,145 526 Due to related parties 16,389 4,544 Accrued liabilities 4,240 898 Deferred revenue 5,529 3,207 12,734 - Derivative instruments Total current liabilities 63,200 9,175 ------------ ------------ Long-term liabilities Long-term debt 624,418 474,000 Deferred revenue 4,197 2,812 Derivative instruments 5,550 32,505 ------------ ------------ Total long-term liabilities 634,165 509,317 ------------ ------------ Total liabilities 697,365 518,492 ------------ ------------ Partners' capital 527,338 239,760 ------------ ------------ Total liabilities and partners' capital 1,224,703 $ 758,252 ------------ ------------Capital Product Partners L.P. Unaudited Condensed Consolidated Statements of Cash Flows (In thousands of United States Dollars) For the nine-month period ended September 30, 2011 2010 Cash flows from operating activities: Net income 86,082 16,530 Adjustments to reconcile net income to net cash provided by operating activities: Vessel depreciation 24,960 23,347 Gain from bargain purchase (82,453) - Amortization of deferred charges 651 417 Amortization of above market acquired time and bare-boat charter 3,514 313 Gain on derivative instruments ineffective portion (1,268) - Equity compensation expense 1,611 197 Changes in operating assets and liabilities: Trade accounts receivable 50 (4,384) Due from related parties (106) 7 Prepayments and other assets (280) 91 Inventory (291) (225) Trade accounts payable 2,155 526 Due to related parties 974 (479) Accrued liabilities 1,817 (262) Deferred revenue 3,707 (1,322) ------------ ------------ Net cash provided by operating activities 41,123 34,756 ------------ ------------ Cash flows from investing activities: Vessel acquisitions (26,643) (99,061) Acquisition of above market bare-boat charter - (9,000) Maturity of short-term investments - 91,519 Purchase of short-term investments - (77,229) Increase in restricted cash (1,250) (750) Cash and cash equivalents acquired in business acquisition 11,847 - Reclassification of short term investment to restricted cash - 750 ------------ ------------ Net cash (used in) investing activities (16,046) (93,771) ------------ ------------ Cash flows from financing activities: Proceeds from issuance of long-term debt 159,580 - Payments of long-term debt (134,580) - Payments of long-term debt - related party - (1,556) Proceeds from issuance of Partnership units - 105,271 Expenses paid for issuance of Partnership units - (940) Capital contributions by general partner 1,470 - Excess of purchase price over book value of vessels acquired from entity under common control - (10,449) Loan issuance costs (284) - Distributions paid (28,658) (24,663) ------------ ------------ Net cash (used in)/provided by financing activities (2,472) 67,663 ------------ ------------ Net increase in cash and cash equivalents 22,605 8,648 Cash and cash equivalents at beginning of period 32,471 3,552 ------------ ------------ Cash and cash equivalents at end of period 55,076 12,200 ------------ ------------ Supplemental cash flow information Cash paid for interest 23,581 23,953 Non-cash activities Units issued to acquire the vessel owning company of the Cape Agamemnon 57,056 - Acquisition of above market time charter 48,551 - Capital expenditures included in liabilities 382 - Reduction in deferred offering expenses - 107 Net liabilities assumed by Capital Maritime upon vessel contribution to the Partnership - 31,844 Units issued according to the Merger Agreement to acquireCrude Carriers Corporation and its subsidiaries. 155,559 - Fair value of Crude'sCarriers Corporation Equity Incentive Plan acquired by the Partnership as a result of the Merger Agreement. 1,505 -
Unaudited Condensed Consolidated Statements of Cash Flows
(In thousands of United States Dollars)
Non Cash activities - Continued
On
For the nine-month
period ended
September 30,
2011
Trade receivables $ 8,321
Prepayments and other assets 629
Inventory 9,503
Vessels 351,750
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Total assets 370,203
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Trade accounts payable $ 12,497
Due to related parties 10,457
Accrued liabilities 1,525
Long term debt 134,580
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Total liabilities 159,059
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Appendix A - Reconciliation of Non-GAAP Financial Measure
(In thousands of U.S. dollars)
Description of Non-GAAP Financial Measure - Operating Surplus
Operating Surplus represents net income adjusted for non cash items such as depreciation and amortization expense, unearned revenue and unrealized gain and losses. Replacement capital expenditures represent those capital expenditures required to maintain over the long term the operating capacity of, or the revenue generated by, the Partnership's capital assets. Operating Surplus is a quantitative standard used in the publicly-traded partnership investment community to assist in evaluating a partnership's ability to make quarterly cash distributions. Operating Surplus is not required by accounting principles generally accepted in
Reconciliation of Non-GAAP Financial Measure - For the three-month
Operating Surplus period ended
September 30, 2011
Net income $ 68,542
Adjustments to reconcile net income to net cash
provided by operating activities
Depreciation and amortization 8,146
Deferred revenue 2,727
Gain on bargain purchase (65,927)
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NET CASH PROVIDED BY OPERATING ACTIVITIES 13,488
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Replacement Capital Expenditures (3,231)
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OPERATING SURPLUS 10,257
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Reduction on recommended reserves 6,201
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AVAILABLE CASH $ 16,458
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Contact Details:Capital GP L.L.C. Ioannis Lazaridis CEO and CFO +30 (210) 4584 950 E-mail: i.lazaridis@capitalpplp.comCapital Maritime & Trading Corp. Jerry Kalogiratos Finance Director +30 (210) 4584 950 j.kalogiratos@capitalpplp.com Investor Relations / MediaMatthew Abenante Capital Link, Inc. (New York ) Tel. +1-212-661-7566 E-mail: cplp@capitallink.com
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