Jan 31, 2008

Capital Product Partners L.P. Announces Strong Fourth Quarter Financial Results

ATHENS, Greece, Jan 31, 2008 (PrimeNewswire via COMTEX News Network) -- Capital Product Partners L.P. (Nasdaq:CPLP), an international owner of modern product tankers, today announced its financial results for the fourth quarter ended December 31, 2007.

Net income for the quarter was $8.7 million, or $0.38 per limited partnership unit. The operating surplus for the period was $10.7 million. Operating surplus is a non-GAAP financial measure used by certain investors to measure the financial performance of the Partnership and other master limited partnerships. (Please see Appendix A for a reconciliation of this non-GAAP measure to net income.)

Gross revenues for the quarter were $22.6 million, consisting of $21.8 million in base charter hire revenue and $0.8 million in profit sharing revenue. Total operating expenses were $5.7 million, including $5.1 million in fees for the commercial and technical management of the fleet paid to a subsidiary of Capital Maritime & Trading Corp. (Capital Maritime), the Partnership's sponsor. General and administrative expenses relating to the costs of running the Partnership were $0.6 million. Net interest expense and finance cost for the quarter was $3.8 million.

Ioannis Lazaridis, Chief Executive Officer and Chief Financial Officer of Capital Product Partners' general partner, said, "In the fourth quarter we generated an operating surplus of $10.7 million, an 11 percent increase from the third quarter level, which primarily reflects the growth in our average fleet size from acquisitions during the third quarter. We continue to benefit from the stability of our cash flows due to our medium- to long-term charter agreements and our fixed rate management agreement with a subsidiary of Capital Maritime."

The clean product tanker market experienced a later-than-usual seasonal upturn during the fourth quarter, as a result of a rather slow October. The spot market posted a recovery in November, mainly due to the increase in demand as the northern hemisphere headed into winter. Inquiries about long-period charters remained solid in the MR segment, while asset prices held firm at record high levels.

Mr. Lazaridis added, "Overall, 2007 was a remarkable and highly successful year for Capital Product Partners. We completed our initial public offering and launched operations in early April, and during the remainder of the year executed consistently against our business model. We took delivery of four pre-contracted Medium-Range (MR) product tankers ahead of schedule, and also acquired a non-contracted fifth vessel, the M/T Attikos, from our sponsor, thus establishing our presence in the promising small tanker segment. Our 13-vessel fleet at year end represents a 61 percent increase based on dwt capacity from the eight vessels we owned at the time of our IPO, and our 12 brand-new MR Ice Class 1A vessels now represent the largest such fleet in the world. Importantly, we have secured a new commitment for a $350 million five-year non-amortizing loan facility with a number of banks led by HSH Nordbank as lead arranger and DnB Nor as co-arranger, and we now look forward to completing additional accretive acquisitions from Capital Maritime as well as third parties."

On January 29, 2008, the Partnership took successful delivery of Alexandros II, a 51,257 dwt MR chemical/product tanker, from Capital Maritime, a transaction fully financed with debt. The vessel has been fixed under a bareboat charter with Overseas Shipholding Group for 10 years at a daily charter rate of $13,000. Capital Product Partners has agreed to purchase two additional sister 51,000 dwt MR chemical/product tankers, which are scheduled for delivery in June and August 2008, and these have also already been fixed under similar bareboat charters with Overseas Shipholding Group.

Capital Maritime currently is the owner of 33 modern tankers of different sizes, after exercising in December 2007 an option for the construction of an additional six 25,000 dwt IMO II chemical/product tankers with Samho Shipbuilding in Korea. The Partnership has a right of first refusal on six MR product tankers from Capital Maritime if medium- to long-term charters are arranged for them. Twenty-four of Capital Maritime's vessels are handy/small product tankers, of which 23 are currently under construction and expected to be delivered between 2008 and 2010.

Lastly, Mr. Lazaridis pointed out, "The Partnership intends to continue to take advantage of its unique relationship with its sponsor and capitalize on these drop-down opportunities in a prudent manner when it believes they will be accretive to unit holders and long term distribution growth."

The Board of Directors has declared a cash distribution for the fourth quarter of $0.395 per unit, representing a total cash distribution of $9.0 million. The cash distribution of $0.395 represents an increase of 5.3 percent compared to the minimum quarterly distribution. The cash distribution will be paid on February 15th, 2008, to unitholders of record on February 5th, 2008.

The Partnership's long-term debt as of December 31, 2007 was $274.5 million, and stockholders' equity was $161.9 million. In January 2008, the Partnership drew down an additional $48 million from its existing loan facility to fund the full price of the acquisition of Alexandros II. Since then, the Partnership has secured a new commitment for a five-year, non-amortizing $350 million loan facility, subject to the execution of definitive documents. The non-amortizing period runs until March 2013. With this new commitment, the remaining debt facilities of the Partnership will stand at $397.5 million.

Capital Product Partners will host a conference call to discuss its results today at 10:00 a.m. Eastern Time. The public is invited to listen to the conference call by dialing 1-888-935-4577 (U.S. and Canada), or +1 718-354-1389 (international); reference number 7087848. Participants should dial in 10 minutes prior to the start of the call. The slide presentation accompanying the conference call will be available on the Partnership's website at http://www.capitalpplp.com. An audio webcast of the conference call will also be accessible on the website. The relevant links will be found in the Investor Relations section of the website.

About Capital Product Partners L.P.

Capital Product Partners L.P. (Nasdaq:CPLP), a Marshall Islands master limited partnership, is an international owner of product tankers. The Partnership owns 14 product tankers, including 13 modern MR tankers and a small product tanker, and has an agreement to purchase two additional MR product tankers from Capital Maritime & Trading Corp. All 16 vessels are under medium- to long-term charters to BP Shipping Limited, Morgan Stanley, Overseas Shipholding Group and Trafigura Beheer B.V.

Forward Looking Statement:

The statements in this press release that are not historical facts, including statements regarding our new loan facility, potential drop-downs and the delivery of vessels, 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.

 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 year ended
                  For the Three Month Periods ended     December 31,
                             December 31,
                             2007      2006        2007        2006
                                    Predecessor            Predecessor
                                               (see note a)(see note a)

 Time and bareboat charter
  revenues                    $22,645   $ 9,352     $72,543    $19,913

 Voyage expenses                  167       136         770        373
 Vessel operating expenses
  - related party               5,129       371      12,283        890
 Vessel operating expenses         --     1,717       3,196      4,043
 General and administrative
  expenses                        600        --       1,477         --
 Depreciation and amortization  4,250     1,631      13,109      3,370
 Operating income              12,499     5,497      41,708     11,237
 Other income (expense), net:
 Interest expense and
  finance cost                 (4,108)   (2,154)    (10,809)    (4,584)

 Loss on swap acquired from
  Capital Maritime
  as of April 4, 2007              --        --      (3,763)        --
 Interest income                  289         5         710         13
 Foreign currency gain/(loss),
  net                               3       (22)        (19)       (56)
 Total other expense, net      (3,816)   (2,171)    (13,881)    (4,627)
 Net income                   $ 8,683   $ 3,326     $27,827    $ 6,610

 Supplemental information for the three month period December 31, 2007
 and the year ended December 31, 2007:
                                             Three months      Year
                                             ------------   ----------
                                              ended December 31, 2007
 Net Income                                  $    8,683     $   27,827
 General Partner's interest in net income
  for the periods                            $      174     $      557
 Limited Partners' interest in net income
  for the periods:
     Common                                       5,152         16,511
     Subordinated                                 3,357         10,759
 Net income per limited partner unit,
  (basic and diluted)                        $     0.38     $     1.22
 Weighted average number of limited
  partners' units outstanding, (basic
  and diluted) as of December 31, 2007       22,318,022     22,318,022

 Capital Product Partners L.P.
 Unaudited Condensed Consolidated Balance Sheets
 (In thousands of United States dollars, except number of shares)

                                   Balance Sheet         Combined
                                       as of           Balance Sheet
                                  December 31, 2007        as of
                                                     December 31, 2006
 Current assets
 Cash and cash equivalents               $  19,917          $    1,239
 Trade accounts receivable                   1,488                 771
 Insurance claims                               --                  69
 Due from related parties                       --               4,954
 Prepayments and other assets                  140                 172
 Inventories                                    --                 259
 Total current assets                       21,545               7,464
 Fixed assets
 Vessels under construction                                     29,225
 Vessels, net                              429,171             178,803
 Total fixed assets                        429,171             208,028
 Other non-current assets
 Deferred finance charges, net                 948                 632
 Restricted cash                             3,250                  --
 Total non-current assets                  433,369             208,660
 Total assets                            $ 454,914          $  216,124

 Liabilities and Stockholders' /
  Partners' Equity
 Current liabilities
 Current portion of long-term debt                          $    6,029
 Current portion of related party debt                           8,042
 Trade accounts payable                  $     257               1,539
 Due to related parties                         28               1,899
 Accrued loan interest                          --               1,513
 Accrued other liabilities                     249                 478
 Deferred revenue                            3,200                 475
 Total current liabilities                   3,734              19,975
 Long-term liabilities
 Long-term debt                            274,500              59,254
 Long-term related party debt                   --              87,498
 Deferred revenue                              690                  --
 Financial instruments - fair value         14,051                  --
 Total long-term liabilities               289,241             146,752
 Total liabilities                         292,975             166,727
 Commitments and contingencies                                      --
 Partners' / Stockholders' Equity
 Common stock (par value $0; 3,500 shares
  issued and outstanding at December
  31, 2006)                                     --                  --
 Additional paid in capital                     --              41,857
 Other comprehensive loss                  (10,288)                 --
 Retained earnings                              --               7,540
 General Partner                             3,445                  --
 Limited Partners
 -        Common                           102,130                  --
 -        Subordinated                      66,652                  --
 Total partners' / stockholders' equity    161,939              49,397
 Total liabilities and partners' /
  stockholders' equity                   $ 454,914          $  216,124

 Capital Product Partners L.P.
 Unaudited Condensed Consolidated Statements of Cash Flows
 (In thousands of United States dollars)

                                          For the           For the
                                        Year Ended        Year Ended
                                    December 31, 2007  December 31, 2006

 Cash flows from operating activities:
 Net income                                  $27,827           $ 6,610
 Adjustments to reconcile net income to
  net cash provided by operating
 Vessel depreciation                          13,017             3,370
 Amortization of deferred charges                204                41
 Loss on swap acquired from Capital
  Maritime as of April 4, 2007                 3,763                --
 Changes in operating assets and
 Trade accounts receivable                    (2,757)             (734)
 Insurance claims                                 (1)              (65)
 Due from related parties                     (2,644)           (4,247)
 Prepayments and other assets                   (325)             (141)
 Inventories                                     (69)             (229)
 Dry docking cost                               (921)               --
 Trade accounts payable                        1,113             1,386
 Due to related parties                        3,646             1,131
 Accrued interest                             (1,476)            1,433
 Accrued other liabilities                       577               479
 Deferred revenue                              8,628               463
 Net cash provided by operating activities    50,582             9,497
 Cash flows from investing activities:
 Vessel acquisitions                        (243,688)         (142,795)
 Vessel advances - new buildings                  --           (19,252)
 Increase of restricted cash                  (3,250)               --
 Net cash used in investing activities      (246,938)         (162,047)
 Cash flows from financing activities:
 Proceeds from issuance of long-term debt    344,361            77,426
 Proceeds from related party loans                --            82,341
 Repayments of long-term debt                (16,841)          (21,393)
 Repayments of related party loans                --            (2,254)
 Payment of deferred financing costs          (1,022)             (285)
 Excess purchase price over acquired assets
 (see note b)                                (80,866)               --
 Dividends paid                              (42,026)               --
 Cash balance as of April 3, 2007 retained
  by Capital Maritime                         (2,251)               --
 Capital contributions                        13,679            17,947
 Net cash provided by financing activities   215,034           153,782

 Net increase in cash and cash equivalents    18,678             1,232
 Cash and cash equivalents at beginning of
  period                                       1,239                 7
 Cash and cash equivalents at end of period  $19,917           $ 1,239

 Supplemental Cash Flow information
 Cash paid for interest expense              $12,250           $ 4,713


(a) The statements of income for the years ended December 31, 2007 and 2006 include the results of operations of M/T Attikos ,which was acquired from an entity under common control on September 24, 2007, as though the transfer had occurred at the beginning of the earliest period presented. The balance sheet as of December 31, 2006 has been retroactively adjusted to include M/T Attikos assets, liabilities and owners equity.

(b) On May 8, July 13, September 20, September 24, and September 28, 2007 the Partnership acquired from Capital Maritime the vessels: M/T Atrotos, M/T Akeraios, M/T Apostolos, M/T Attikos, and M/T Anemos I respectively for a total purchase price of $247,000. The vessels have been recorded in the Partnership's financial statements at the amount of $166,134 which was reflected in Capital Maritime's consolidated financial statements, which differs from the acquisition price by $80,866. We recognize transfers of net assets between entities under common control at Capital Maritime's basis in the net assets contributed. In addition, transfers of net assets between entities under common control are accounted for as if the transfer occurred at the beginning of the earliest period presented, and prior years financial statements are retroactively adjusted to furnish comparative information similar to the pooling method. The amount of the purchase price in excess of Capital Maritime's basis in the net assets, if any, is recognized as a reduction to partners' equity and presented as a financing activity in the statement of cash flows.

 Capital Product Partners
 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 the United States and should not be
 considered as an alternative to net income or any other indicator of
 the Partnership's performance required by accounting principles
 generally accepted in the United States. The table below reconciles
 Operating Surplus to net income.

 Reconciliation of Non-GAAP Financial Measure -
  Operating Surplus

                                            For the period from
                                             October 1, 2007 to
                                             December 31, 2007

 Net income                                                $  8,683

 Adjustments to reconcile net income
  to net cash provided by operating
   Depreciation and Amortization        $  4,246
   Deferred revenue                          219              4,465
 NET CASH BY OPERATING ACTIVITIES                            13,148

 Replacement Capital Expenditures                            (2,468)
 OPERATING SURPLUS                                           10,680
 Recommended reserves                                         1,684
 AVAILABLE CASH                                               8,996


This news release was distributed by PrimeNewswire, www.primenewswire.com

SOURCE: Capital Product Partners L.P.

Capital GP L.L.C.
          Ioannis Lazaridis, Chief Executive Officer and 
           Chief Financial Officer
          +30 (210) 4584950

          Capital Maritime & Trading Corp.
          Jerry Kalogiratos, Commercial Officer
            +30 (210) 4584950
          Merete Serck-Hanseen, SVP Finance
            +1 (203) 539-6026

          RF Binder Partners Inc.
          Robert Ferris
            +1 (212) 994-7505
          Tom Pratt
            +1 (212) 994-7563

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