Capital Product Partners L.P. Announces First Quarter 2021 Financial Results

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(Image Courtesy: Capital Product Partners)

Capital Product Partners, an international owner of ocean-going vessels, on April 29 released its financial results for the first quarter ended March 31, 2021.

Highlights:

Operating Surplus1 and Operating Surplus after the quarterly allocation to the capital reserve for the first quarter of 2021 were $24.5 million and $14.4 million respectively.
Announced common unit distribution of $0.10 for the first quarter of 2021.
Repurchased 133,423 of the Partnership’s common units, at an average cost of $10.46 per unit.
Took delivery of three 5,100 TEU container vessels with long term charter to Hapag Lloyd.
Agreed to sell two 9,300 TEU container vessels for a total consideration of $195.0 million, which is expected to result in a capital gain of $47.8 million.

COVID-19

“We continue to monitor the impact of COVID-19 on the Partnership’s financial condition and operations and on the container industry, in general. The various travel restrictions, health protocols and changing quarantine regimes in the countries in which we operate have so far translated into, among other things, increased costs and off hire related to crewing, crew rotation and crew related expenses, in addition to higher forwarding expenses and longer lead times to delivery, as well as increased dry-docking duration and costs. While it is not always possible to distinguish incremental costs or off-hire associated with the impact of COVID-19 on our operations, we estimate that for the first quarter of 2021, incremental operating and/or voyage costs associated with COVID-19 were approximately $0.1million,” the company said.

The company added, “The actual impact of the COVID-19 pandemic in the longer run, as well as the extent of any measures we take in response to the challenges presented by it, as described in our previous releases, will depend on how the pandemic will continue to develop, the duration and extent of the restrictive measures that are associated with the pandemic and their further impact on global economy and trade. Currently, the container charter market is benefiting from the impact of COVID-19 on the global trade logistics chain.”

Management Commentary

Jerry Kalogiratos, Chief Executive Officer of our General Partner, commented:

“The first quarter financial performance of the Partnership reflects primarily the contribution of the increased fleet size of the Partnership, as we have managed to increase our fleet by more than 55% in terms of number of vessels since the spin-off of our tanker assets two years ago.

We have recently also taken advantage of the extraordinary container market environment and moved to sell two of our vessels at record high prices, thus securing a significant capital gain and a material increase in our available cash balances, once the sales materialize. This gives us a unique opportunity to pursue our objectives at a grander scale: first, to continue to grow our fleet with modern vessels that provide cash flow visibility, second to continue to return capital to our unitholders through distributions and unit buybacks and last but not least to set the basis for a fleet renewal program that will help reduce the Partnership’s environmental footprint, as ESG considerations and especially vessel trading emissions come to the forefront in our industry.”

Financial Summary

Overview of First Quarter 2021 Results

Net income for the quarter ended March 31, 2021 was $10.9 million, compared with net income of $6.7 million for the first quarter of 2020. After taking into account the interest attributable to the general partner, net income per common unit for the quarter ended March 31, 2021 was $0.57, compared to net income per common unit of $0.35 for the first quarter of 2020.

Total revenue was $38.1 million for the quarter ended March 31, 2021, compared to $33.7 million during the first quarter of 2020….



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