UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
____________________
FORM
6-K
REPORT
OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR
15d-16
OF THE SECURITIES EXCHANGE ACT OF 1934
For
the month of October, 2009
COMMISSION
FILE NUMBER 001-33373
____________________
CAPITAL
PRODUCT PARTNERS L.P.
(Translation
of registrant’s name into English)
____________________
3
IASSONOS STREET
PIRAEUS,
18537 GREECE
(address
of principal executive offices)
____________________
Indicate
by check mark whether the registrant files or will file annual reports under
cover of Form 20-F or Form 40-F.
Form
20-F x Form
40-F o
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(1):
Yes o No x
Indicate
by check mark if the registrant is submitting the Form 6-K in paper as permitted
by Regulation S-T Rule 101(b)(7):
Yes o No x
Indicate
by check mark whether the registrant by furnishing the information contained in
this Form is also thereby furnishing the information to the Commission pursuant
to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes o No x
If “yes”
is marked, indicate below this file number assigned to the registrant in
connection with Rule 12g3-2(b): N/A
Item
1 – Information Contained in this Form 6-K Report
Attached
as Exhibit I is a press release of Capital Product Partners L.P., dated October
30, 2009.
This
report on Form 6-K is hereby incorporated by reference into the registrant's
registration statement, registration number 333-153274, dated October 1,
2008.
SIGNATURES
Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant has duly
caused this report to be signed on its behalf by the undersigned, thereunto duly
authorized.
|
CAPITAL
PRODUCT PARTNERS, L.P.,
|
|
|
By:
|
Capital
GP L.L.C., its general partner
|
| /s/ Ioannis E. Lazaridis | |
|
Name:
Ioannis E.
Lazaridis
|
|
|
Financial
Officer of Capital GP L.L.C.
|
|
Dated:
October 29, 2009
Exhibit I
CAPITAL
PRODUCT PARTNERS L.P. ANNOUNCES THIRD QUARTER 2009 FINANCIAL
RESULTS
Athens, Greece - October 30,
2009 – Capital Product Partners L.P. (the “Partnership”), (Nasdaq: CPLP),
an international owner of modern double-hull tankers, today released its
financial results for the third quarter ended September 30, 2009.
The
Partnership’s net income for the quarter ended September 30, 2009 was $7.1
million or $0.28 per limited partnership unit, which is $0.04 less than the
$0.32 per unit from the previous quarter ended June 30, 2009, and $0.34 lower
than the third quarter last year. This drop compared to last year is primarily
due to the absence of profit sharing revenues and higher interest
expenses.
Operating
surplus for the quarter ended September 30, 2009 was $10.7 million, less than
the $11.5 million from the second quarter of 2009 and lower than the $18.7
million from the third quarter of 2008. 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 financial measure to net
income.)
Revenues
for the third quarter of 2009 were $30.5 million compared to $36.0 million of
revenues in the third quarter of 2008. There were no profit sharing revenues in
the third quarter of 2009 due to the depressed spot market for both product and
crude tankers throughout this period. In the third quarter of 2008 the profit
sharing revenues amounted to $6.6 million.
Total
operating expenses for the third quarter of 2009 were $15.3 million, including
$7.2 million paid to a subsidiary of Capital Maritime & Trading Corp.
(Capital Maritime), the Partnership’s sponsor, for the commercial and technical
management of the fleet, $7.0 million in depreciation and $0.8 million in
general and administrative expenses, compared to $13.9 million for the third
quarter of 2008. Net interest expense and finance cost for the third quarter of
2009 totaled $8.1 million compared to $6.5 million for the third quarter of
2008. The increase in net interest expense and finance cost is due to the higher
interest margin applicable to our loan facilities as of June 30th 2009
following the amendments to the terms of our loan agreements outlined in our
press release of July 31st 2009 as
well as an additional cost of $0.4 million, which is due to the increased
funding costs of the banks, incurred in accordance with the terms of our loan
agreements.
Tanker
freight rates continued to come under pressure over the course of the third
quarter 2009 reaching in certain segments of the tanker market multi year lows.
Refinery utilization remains depressed as a result of the lower demand for
refined products on either side of the Atlantic, which has negatively affected
the demand for product tankers. The increase in the availability of spot tonnage
and rising bunker prices had a further adverse affect on MR tanker spot earnings
marking the worst third quarter since 1992 according to industry data. The
Suezmax spot market showed pockets of strength over the third quarter compared
to other tanker segments on the back of exports from former Soviet Union
countries, but earnings still dropped to their lowest level for the quarter
since 2002 as erratic exports out of Nigeria and decreased refinery utilization
weighed heavily on earnings. The period and S&P markets continued to be
illiquid with few transactions taking place at increasingly lower
levels.
1
Ioannis
Lazaridis, Chief Executive Officer and Chief Financial Officer of Capital
Product Partners’ general partner, said: “As a result of our long term
chartering strategy, which has insulated us from one of the most depressed
tanker spot markets of the last two decades, our results for the third quarter
were sustained at levels substantially above those indicated by the currently
prevailing spot market tanker charter rates.”
As of
September 30, 2009, the Partnership’s long-term debt remained unchanged compared
to the end of 2008 at $474.0 million and partners’ equity was $158.3 million.
The remaining undrawn amounts under the terms of our debt facilities currently
stand at $246.0 million.
On
October 26, 2009, the Board of Directors of the Partnership declared a cash
distribution for the third quarter of 2009 of $0.41 per unit, which is equal to
the distribution for the second quarter of 2009. The third quarter cash
distribution will be paid on November 13, 2009 to unit holders of record on
November 5, 2009.
Mr.
Lazaridis concluded: “The tanker industry continues to face an adverse trade
environment alongside a continuously tightening credit market neither of which
shows any signs of near term improvement. The depressed spot tanker
market, the potential vessel deliveries for the remainder of this year and for
2010 and the outlook for global oil demand in 2009, which remains weak (expected
to drop by 1.9% or -1.7 mb/d versus 2008 according to IEA), are all factors
likely to have a further adverse effect on tanker vessel prices and period rates
in the short- to medium- term. We would like to reiterate that we have zero
capital commitments to purchase or build vessels; we have amended a number of
the terms in our loan facilities and our fleet’s charter coverage for the
remainder of 2009 and for 2010 stands at approximately 97% and 67%,
respectively. However, the uncertain prospects for the rest of the year and the
lack of tangible recovery signs for 2010 in the tanker market are all likely to
have an adverse impact on our results and financial condition over time,
particularly as vessels come up for rechartering.”
Capital
Product Partners will host a conference call to discuss its results today at
10:00 a.m. Eastern Time (U.S.). The public is invited to listen to the
conference call by dialing +1 888 935 4575 (U.S. toll free), or +1 718 354 1387
(international); reference number 3440108#. 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 www.capitalpplp.com.
An audio webcast of the conference call will also be accessible through 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 modern double-hull tankers. Capital
Product Partners L.P. owns 18 modern vessels, comprising 15 MR tankers, two
small product tankers and one Suezmax crude oil tanker. Our vessels are under
medium to long-term charters to BP Shipping Limited, Morgan Stanley Capital
Group Inc., Overseas Shipholding Group and Shell International Trading &
Shipping Company Ltd.
2
For more
information about the Partnership and to access or request a copy of its Annual
Report, please visit our website: www.capitalpplp.com
Forward
Looking Statement:
The
statements in this press release that are not historical facts, including our
expectations regarding developments in the markets and their effects, the
effects on our financial condition and results, the effect of our vessels coming
up for rechartering and our ability to recharter such vessels, our expectations
regarding oil demand, our expected charter coverage rates for 2009 and 2010, our
future commitments and the effect of the amendments to our credit facilities,
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.
CPLP-F
3
Capital
Product Partners L.P.
Unaudited
Condensed Consolidated and Combined Statements of Income
(Notes
1-4)
(In
thousands of United States dollars, except number of units and earnings per
unit)
|
For
the three month period ended September 30,
|
For
the nine month period ended September 30,
|
|||||||||||||||
|
2009
|
2008
|
2009
|
2008
|
|||||||||||||
|
Revenues
|
$ | 30,498 | $ | 36,037 | $ | 94,073 | $ | 95,292 | ||||||||
|
Expenses:
|
||||||||||||||||
|
Voyage
expenses
|
284 | 264 | 816 | 826 | ||||||||||||
|
Vessel
operating expenses - related party
|
7,180 | 6,474 | 21,878 | 18,064 | ||||||||||||
|
Vessel
operating expenses
|
- | - | 499 | 3,560 | ||||||||||||
|
General
and administrative expenses
|
831 | 672 | 2,244 | 2,073 | ||||||||||||
|
Depreciation
|
6,990 | 6,524 | 21,274 | 18,208 | ||||||||||||
|
Operating
income
|
15,213 | 22,103 | 47,362 | 52,561 | ||||||||||||
|
Other
income (expense), net:
|
||||||||||||||||
|
Interest
expense and finance cost
|
(8,410 | ) | (6,779 | ) | (23,800 | ) | (18,294 | ) | ||||||||
|
Interest
income
|
336 | 319 | 1,201 | 785 | ||||||||||||
|
Foreign
currency (loss), net
|
(7 | ) | 7 | (4 | ) | (49 | ) | |||||||||
|
Total
other (expense), net
|
(8,081 | ) | (6,453 | ) | (22,603 | ) | (17,558 | ) | ||||||||
|
Net
income
|
7,132 | 15,650 | 24,759 | 35,003 | ||||||||||||
|
Less:
|
||||||||||||||||
|
Net
(loss)/income attributable to CMTC operations
|
- | - | 810 | (1,504 | ) | |||||||||||
|
Partnership’s
net income
|
7,132 | 15,650 | $ | 23,949 | $ | 36,507 | ||||||||||
|
General
Partner’s interest in Partnership’s net income
|
$ | 143 | $ | 313 | $ | 479 | $ | 730 | ||||||||
|
Limited
Partners’ interest in Partnership’s net income
|
$ | 6,989 | $ | 15,337 | $ | 23,470 | $ | 35,777 | ||||||||
|
Net
income per:
|
||||||||||||||||
|
· Common units
(basic and diluted)
|
0.28 | 0.62 | 0.95 | 1.52 | ||||||||||||
|
· Subordinated
units (basic and diluted)
|
- | 0.62 | 0.96 | 1.44 | ||||||||||||
|
· Total units
(basic and diluted)
|
0.28 | 0.62 | 0.95 | 1.49 | ||||||||||||
|
Weighted-average
units outstanding:
|
||||||||||||||||
|
· Common units
(basic and diluted)
|
24,817,151 | 16,011,629 | 23,397,946 | 15,166,867 | ||||||||||||
|
· Subordinated
units (basic and diluted)
|
- | 8,805,522 | 1,419,205 | 8,805,522 | ||||||||||||
|
· Total units
(basic and diluted)
|
24,817,151 | 24,817,151 | 24,817,151 | 23,972,389 | ||||||||||||
4
Capital
Product Partners L.P.
Unaudited
Condensed Consolidated and Combined Balance Sheets
(Notes
1-4)
(In
thousands of United States dollars, except number of shares)
|
September
30, 2009
|
December
31, 2008
|
|||||||
|
Assets
|
||||||||
|
Current
assets
|
||||||||
|
Cash
and cash equivalents
|
$ | 1,219 | $ | 43,149 | ||||
|
Short
term investment
|
30,185 | 1,080 | ||||||
|
Trade
accounts receivable
|
587 | 6,421 | ||||||
|
Prepayments
and other assets
|
736 | 602 | ||||||
|
Inventory
|
- | 94 | ||||||
|
Total
current assets
|
32,727 | 51,346 | ||||||
|
Fixed
assets
|
||||||||
|
Vessels,
net
|
644,534 | 718,153 | ||||||
|
Total
fixed assets
|
644,534 | 718,153 | ||||||
|
Other
non-current assets
|
||||||||
|
Deferred
charges, net
|
3,221 | 2,884 | ||||||
|
Restricted
cash
|
4,500 | 4,500 | ||||||
|
Total
non-current assets
|
652,255 | 725,537 | ||||||
|
Total
assets
|
$ | 684,982 | $ | 776,883 | ||||
|
Liabilities
and Partners’ / Stockholders’ Equity
|
||||||||
|
Current
liabilities
|
||||||||
|
Current
portion of long-term debt
|
$ | - | $ | - | ||||
|
Current
portion of related party long-term debt
|
- | 24,538 | ||||||
|
Trade
accounts payable
|
744 | 477 | ||||||
|
Due
to related parties
|
3,501 | 2,254 | ||||||
|
Accrued
liabilities
|
2,165 | 1,150 | ||||||
|
Deferred
revenue
|
417 | 3,795 | ||||||
|
Distribution
payable to General Partner
|
3,117 | - | ||||||
|
Total
current liabilities
|
9,944 | 32,214 | ||||||
|
Long-term
liabilities
|
||||||||
|
Long-term
debt
|
474,000 | 474,000 | ||||||
|
Long-term
related party debt
|
- | 27,762 | ||||||
|
Deferred
revenue
|
1,872 | 1,568 | ||||||
|
Derivative
instruments
|
40,858 | 47,414 | ||||||
|
Total
long-term liabilities
|
516,730 | 550,744 | ||||||
|
Total
liabilities
|
526,674 | 582,958 | ||||||
|
Commitments
and contingencies
|
- | - | ||||||
|
Total
Partners’ / Stockholders’ Equity
|
158,308 | 193,925 | ||||||
|
Total
liabilities and partners’ / stockholders’ equity
|
$ | 684,982 | $ | 776,883 | ||||
5
Capital
Product Partners L.P.
Unaudited
Condensed Consolidated and Combined Statements of Cash Flows
(Notes
1-4)
(In
thousands of United States dollars)
|
For
the nine month period ended
September 30,
|
||||||||
| 2009 | 2008 | |||||||
|
Cash
flows from operating activities:
|
||||||||
|
Net
income
|
$ | 24,759 | $ | 35,003 | ||||
|
Adjustments to reconcile net
income to net cash provided by operating
activities:
|
||||||||
|
Vessel
depreciation and amortization
|
21,274 | 18,208 | ||||||
|
Amortization
of deferred charges
|
304 | 310 | ||||||
|
Changes
in operating assets and liabilities:
|
||||||||
|
Trade
accounts receivable
|
5,721 | (1,495 | ) | |||||
|
Due
from related parties
|
(11 | ) | (235 | ) | ||||
|
Prepayments
and other assets
|
(203 | ) | (525 | ) | ||||
|
Inventories
|
(178 | ) | 177 | |||||
|
Trade
accounts payable
|
940 | 999 | ||||||
|
Due
to related parties
|
3,024 | 1,695 | ||||||
|
Accrued
liabilities
|
1,181 | 324 | ||||||
|
Deferred
revenue
|
(3,074 | ) | (2,368 | ) | ||||
|
Dry
docking paid
|
- | (251 | ) | |||||
|
Net
cash provided by operating activities
|
53,737 | 51,842 | ||||||
|
Cash
flows from investing activities:
|
||||||||
|
Vessel
advances and acquisitions
|
(26,150 | ) | (247,365 | ) | ||||
|
Increase
of restricted cash
|
- | (1,250 | ) | |||||
|
Purchase
of short term investment
|
(29,105 | ) | (25,500 | ) | ||||
|
Net
cash (used in) investing activities
|
(55,255 | ) | (274,115 | ) | ||||
|
Cash
flows from financing activities:
|
||||||||
|
Proceeds
from issuance of long-term debt
|
- | 199,500 | ||||||
|
Proceeds
from related party debt/financing
|
- | 86,523 | ||||||
|
Payments
of long-term debt
|
- | (8,080 | ) | |||||
|
Payments
of related party debt/financing
|
(23,309 | ) | (52,463 | ) | ||||
|
Loan
issuance costs
|
(710 | ) | (2,004 | ) | ||||
|
Excess
of purchase price over book value of vessels acquired from entity under
common control
|
- | (3,755 | ) | |||||
|
Dividends
paid
|
(56,963 | ) | (29,508 | ) | ||||
|
Cash
balance that was distributed to the previous owner
|
- | (2 | ) | |||||
|
Capital
contributions by Capital Maritime
|
40,570 | 19,820 | ||||||
|
Net
cash used in/provided by financing activities
|
(40,412 | ) | 210,031 | |||||
|
Net
(decrease) in cash and cash equivalents
|
(41,930 | ) | (12,242 | ) | ||||
|
Cash
and cash equivalents at beginning of period
|
43,149 | 19,919 | ||||||
|
Cash
and cash equivalents at end of period
|
$ | 1,219 | $ | 7,677 | ||||
|
Supplemental
Cash Flow information
|
||||||||
|
Cash
paid for interest
|
$ | 22,303 | $ | 17,423 | ||||
|
Non-cash
Activities
|
||||||||
|
Net
book value of vessels transferred-in, M/T Agamemnon II and M/T Ayrton II
less cash paid.
|
68,054 | - | ||||||
|
Net
book value of vessels transferred-out, M/T Assos and M/T
Atrotos
|
(70,496 | ) | - | |||||
|
Net
liabilities assumed by CMTC upon vessel contribution to the
Partnership
|
31,073 | 74,239 | ||||||
|
Units
issued to acquire vessel owning company of M/T Amore Mio
II.
|
- | $ | 37,739 | |||||
|
Units
issued to acquire vessel owning company of M/T Amore Mio
II.
|
- | $ | 10,066 | |||||
|
Change
in accrued and payable offering expenses
|
- | $ | 109 | |||||
6
Notes
(1) The unaudited condensed
consolidated and combined statements of income and cash flows for the three and
nine month period ended September 30, 2009 include the results of operations
of:
|
|
(a)
|
M/T
Agamemnon II and M/T Ayrton II (a 51,238dwt sister MR product tankers
which were delivered to Capital Maritime on November 24, 2008 and April
10, 2009 respectively) were acquired from Capital Maritime, an entity
under common control, on April 7 and April 13, 2009 respectively, as
though the transfers had occurred at the beginning of the earliest period
presented and
|
|
|
(b)
|
M/T
Assos and M/T Atrotos up to April 6, 2009 and April 12, 2009 which were
exchanged on the same date with M/T Agamemnon II and M/T Ayrton II
respectively
|
The
unaudited condensed consolidated and combined statements of income and cash
flows for the three and nine month period ended September 30, 2008 include the
results of operations of M/T Amore Mio II and M/T Aristofanis which were
acquired from an entity under common control on March 27, 2008, and April 30,
2008, respectively, as though the transfers had occurred at the beginning of the
earliest period presented.
(2) On April 7, and April 13,
2009 the Partnership acquired from Capital Maritime the shares of the vessel
owning companies of the M/T Agamemnon II and M/T Ayrton II. In exchange Capital
Maritime received all the shares of the vessel owning companies of the M/T Assos
and M/T Atrotos, which were part of the Partnership’s fleet, and an additional
cash consideration of $8,000. The amount of $23,708, which was the difference of
the historic cost between these vessels, has been recorded as an increase in the
partners’ equity. The cash consideration of $8,000 reduced the partners’ equity
and is presented as an investing activity under vessel advances and acquisitions
in the statements of cash flows for the nine month period ended September 30,
2009. The Partnership accounted for the acquisition of the vessel owning
companies of the M/T Agamemnon II and M/T Ayrton II as a transfer of equity
interests between entities under common control at Capital Maritime’s carrying
amounts (historical cost) of the net assets contributed. In addition, transfers
of equity interests 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-of-interest method of
accounting.
All
assets and liabilities of the vessel owning companies of the M/T Agamemnon II
and M/T Ayrton II, except the vessel, the time charter agreements and necessary
permits were retained by Capital Maritime.
All
assets and liabilities of the vessel owning companies of the M/T Assos and M/T
Atrotos, except the vessel and necessary permits were retained by the
Partnership.
(3) Short term investment
consists of cash time deposits with original maturities of more than three
months.
(4) The Partnership adopted on
January 1, 2009 the provisions of ASC 260-10-05 “Application of the Two-Class Method. ASC
260-10-05 considers whether the incentive distributions of a master limited
partnership represent a participating security when considered in the
calculation of earnings per unit under the two-class method. ASC 260-10-05 also
considers whether the partnership agreement contains any contractual limitations
concerning distributions to the incentive distribution rights that would impact
the amount of earnings to allocate to the incentive distribution rights for each
reporting period. The Partnership retrospectively applied the provisions of the
ASC 260-10-05 to the three and nine months period ended September 30, 2008.
Following the application of the above standard the Partnership’s earnings per
unit for the three and nine month period ended September 30, 2008 increased from
$0.56 and $1.46 per unit to $0.62 and $1.49 per unit
respectively.
7
Capital Product Partners
L.P.
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 tables below reconcile Operating Surplus to net income for the three
month period ended September 30, 2009.
|
Reconciliation of Non-GAAP
Financial Measure –
Operating
Surplus
|
For
the three month period ended
September
30, 2009
|
|||||||
|
Net
income
|
$ | 7,132 | ||||||
|
Adjustments
to reconcile net income to net cash provided by operating
activities
|
||||||||
|
Depreciation
and amortization
|
7,128 | |||||||
|
Deferred
revenue
|
215 | 7,343 | ||||||
|
NET
CASH PROVIDED BY OPERATING ACTIVITIES
|
14,475 | |||||||
|
Replacement
Capital Expenditures
|
(3,806 | ) | ||||||
|
OPERATING
SURPLUS
|
10,669 | |||||||
|
Recommended
reserves
|
(286 | ) | ||||||
|
AVAILABLE
CASH
|
10,383 | |||||||
8