Capital Product downgraded to Hold from Buy at Jefferies » 14:0907/3107/31/20
Jefferies analyst Randy…
Jefferies analyst Randy Giveans downgraded Capital Product to Hold from Buy with a price target of $7, down from $14.
Capital Product reduces dividend to 10c per common unit » 07:1607/3107/31/20
On July 31, 2020, the…
On July 31, 2020, the Board of Directors of the Partnership declared a cash distribution of $0.10 per common unit for the second quarter of 2020 payable on August 14, 2020 to common unit holders of record on August 9, 2020.
Capital Product reports Q2 EPS 46c, consensus 50c » 07:1407/3107/31/20
Reports Q2 revenue…
Reports Q2 revenue $36.6M, consensus $35.69M. Jerry Kalogiratos, CEO of the General Partner, commented: "The COVID-19 pandemic and its adverse impact on human life, economic activity and logistical chains is a unique and unprecedented event, with continuously and rapidly changing effects across a number of fronts including socioeconomic trends, trade patterns and the world economic outlook that remain very hard to assess at this point in time. In this environment, we continue to prioritize the health and safety of our crews, as well as our onshore employees by designing and implementing, together with our managers, comprehensive measures and policies with regard to COVID-19. The container charter market, as expected, has weakened significantly during the second quarter of 2020 with initial fixtures in May taking place at considerably reduced rates compared to our expectations at the beginning of the year. While we have since seen some improvement in the appetite of liners to charter larger post panamax container vessels at increased rates, the uncertainty around COVID-19 and renewed outbreaks in many different parts of the world, signal, in our opinion, increased volatility ahead for the world economy and uncertain prospects for our underlying markets and customers. In view of the substantially weaker container charter market compared to the beginning of the year and the associated reduced future cash flows, the downward pressure on asset values, and the dislocated MLP markets, which make it impossible for the Partnership to tap equity markets in an accretive manner to replace and grow its fleet, it is important to preserve liquidity. For those reasons, our Board has decided to reduce our common unit distribution to $0.10 per quarter. We expect that the revised distribution will result in additional reserves of approximately $19.0 million per year, which is expected to act as a strong buffer against any further adverse developments in our underlying markets and most importantly provide the Partnership with a war chest, together with its existing cash balances, to replenish and grow its asset base, once the uncertainty around the COVID-19 impact abates. To this effect, the Partnership is closely monitoring potential asset acquisitions so that it may avail itself of expansion opportunities in the right market conditions. The Partnership has a long history of returning capital to its unitholders through uninterrupted distributions to common unit holders since 2007, as well as through transactions such as that with Diamond S Shipping. The board believes that the revised distribution guidance will allow the Partnership more flexibility at this critical juncture to generate future value for its unitholders, while it continues to assess the capital allocation strategy of the Partnership."
|Over a month ago|
Capital Product extends three period charters, secures employment for 'Akamidos' » 09:1006/0906/09/20
Capital Product Partners…
Capital Product Partners announced that it has agreed to extend the three long-term time charters with Hapag-Lloyd by two additional years and secured short term employment for the MV 'Akadimos'. The Partnership has agreed to extend with effect from June 1, 2020 the time charters currently in place for the vessels M/V 'Athos', the M/V 'Aristomenis' and the M/V 'Athenian' for two additional years. The vessels will earn a daily rate of $25,950 per day, increasing to $26,950 per day, for the M/V 'Aristomenis' from October 2020, and from July 2021 onwards for the M/V 'Athos' and the M/V 'Athenian'. The time charters will expire at the earliest in April 2026 and include two one-year options at $31,450 and $32,450 gross per day, respectively. Furthermore, the M/V 'Akadimos' secured short time charter employment with a liner operator for a period of about 80 days. The new charter is expected to commence in early July 2020 after the vessel passes its scheduled special survey. As a result, the Partnership's charter coverage for the remainder of 2020 and for 2021 has changed to 88% and 73%, respectively and the remaining charter duration to 5.0 years.
Capital Product announces refinancing of three 9,000 TEU container vessels » 09:1105/2705/27/20
Capital Product Partners…
Capital Product Partners announced the closing of the refinancing of its three 9,000 TEU container vessels. The Partnership completed the previously announced refinancing with ICBC Financial Leasing Co. for the sale and lease back of three vessels previously mortgaged under our 2017 credit facility, namely the CMA CGM Amazon, the CMA CGM Uruguay and the CMA CGM Magdalena, for a total amount of $155.4M. The repayment amount under the 2017 credit facility was $116.5M and as a result the refinancing has generated an additional $38.8M of liquidity for the Partnership. The lease has a duration of 7 years and includes mandatory purchase obligations for the Partnership to repurchase the vessels on expiration at the predetermined price of $77.7M in total. Total debt amortization after the partial refinancing under the ICBCFL lease and the 2017 credit facility will amount to $27.4M per year compared to $30.8M previously paid under the 2017 credit facility, while the lease bears a lower margin compared to the 2017 credit facility.
|Over a quarter ago|
Capital Product expects material reduction in market charter rates » 08:1205/0605/06/20
While it is still too…
While it is still too early to fully assess the impact of COVID-19 on the Partnership's financial condition and operations and on the container industry in general, we have identified the following adverse effects of the COVID-19 pandemic on the Partnership: Significant delays and increased costs associated with the two vessels that had scrubbers retrofitted during the COVID-19 outbreak in China. Both vessels have now completed the scrubber retrofits and commenced their respective employment. The Partnership does not have any other scrubber retrofit commitments at the moment. The previously announced refinancing with ICBC Financial Leasing Co., Ltd. of our three 9,000 TEU container vessels for an amount up to $155.4 million has been delayed due to the outbreak of COVID-19 in China and we now expect to close the transaction in May 2020. The transaction is expected to generate an additional liquidity of up to $38.8 million (based on the current principal amount outstanding under our 2017 credit facility and vessel charter free market values as of March 31, 2020) and reduce the pro rata annual amortization cost for these three vessels by $3.4 million. In addition, the ICBC lease carries a reduced interest margin compared to our existing credit facility. Expected material reduction in market charter rates, as a result of the decreased demand for container capacity and the uncertainty with regard to the timing of a return to more normalized global trade patterns, potentially adversely affecting the re-chartering prospects of certain of our vessels and the financial position of our counterparties. The Partnership has four vessels coming off their present employment in the next 12 months, with the next vessel coming up for renewal after that period in February 2024. Potential adverse impact on asset values reflecting the weaker chartering environment and lack of liquidity in the second hand market. The Partnership is fully compliant with all its financial covenants as of end of the first quarter of 2020 and with its net leverage as defined in the Partnership's loan agreements at 46.8% compared to an upper limit of 75.0%. Increased operating costs and potential for operational disruption and idle time for our vessels as crew rotation, supplying our vessels with spares or other supplies and overhauling or maintenance by attending engineers has been adversely affected by COVID-19 due to travel restrictions and quarantine rules. Both our managers, Capital Executive Ship Management Corp. and Capital Ship Management Corp. have adopted comprehensive COVID-19 policies to protect the physical and mental health of crews onboard our vessels and to minimize operational impacts of the COVID-19 pandemic. The actual impact of these effects and the efficacy of any measures we take in response to the challenges presented by the COVID-19 will depend on how the outbreak will develop, the duration and extent of the restrictive measures that are associated with COVID-19 and their impact on global economy and trade.
Capital Product reports Q1 EPS 35c, consensus 43c » 08:1105/0605/06/20
Reports Q1 revenue…
Reports Q1 revenue $33.7M, consensus $33.94M. Mr. Jerry Kalogiratos, Chief Executive Officer of our General Partner, commented: "The COVID-19 outbreak and its adverse impact on human life, economic activity and logistical chains is a unique and unprecedented event, with continuously and rapidly changing effects across a number of fronts including socioeconomic trends, trade patterns and the world economic outlook that are very hard to assess at this point in time. In this environment, we have prioritized the health and safety of our crews as well as our onshore employees by designing and implementing together with our managers comprehensive measures and policies with regard to COVID-19. It is clear that the container charter market has been adversely affected by COVID-19, but the extent and duration of the impact is very difficult to predict at this stage. A prolonged recession with a continuation or resumption of hard lockdowns over the coming quarters could lead to a prolonged slump in charter rates and adversely affect our cash flows as well as those of liner companies including our counterparties. However, assuming a gradual roll back of social distancing measures within 2020 and a resumption of a more normalized economic activity by the end of the year, analysts expect the market to rebound strongly next year. As we only have a limited amount of vessels coming off charter in the next twelve months and as they come off their employment in a staggered manner, we should be in a position to capitalize from a gradual recovery going forward. In addition, our low leverage compared to our peers and the expected completion of the ICBC Lease that is expected to generate additional liquidity, should provide us with added flexibility in this environment. Once the uncertainty around the COVID-19 impact abates, we are looking forward to resuming growing the Partnership and the Partnership's long term distributable cash flow."
Deutsche Bank to host a virtual summit » 08:3304/0204/02/20
ASC, CMRE, CPLP, DSX, EGLE, EURN, GLOG, GNK, INSW, LPG, NM, NMM, NNA, SALT, SB, SBLK, SFL, STNG, TK, TNP, TOO, ALIN
7th Annual Shipping…
7th Annual Shipping Virtual Summit will be held on April 2. Webcast Link
Capital Product raises quarterly cash distribution of 35c per common unit » 07:0902/0502/05/20
On January 21, 2020, the…
On January 21, 2020, the Board of Directors of the Partnership declared an increased cash distribution of 35c per common unit for the fourth quarter of 2019, representing an increase of 3.5c per common unit compared to the common unit distribution for the previous quarter, payable on February 11, 2020 to common unit holders of record on February 3, 2020.
Capital Product reports Q4 EPS 31c, consensus 23c » 07:0702/0502/05/20
Reports Q4 revenue…
Reports Q4 revenue $27.7M, consensus $25.95M. Jerry Kalogiratos, CEO of our General Partner, commented: "The fourth quarter of 2019 has been a pivotal quarter for the Partnership. We have announced and now completed an important acquisition of three 10,000 TEU container vessels, which is expected to substantially increase our distributable cash flow per unit, while maintaining cash flow visibility as the vessels' charters run into 2024. At the same time, through this acquisition, we increased the size of our fleet by approximately 30%, further expanding into the attractive Neo-Panamax container segment and diversifying our customer base with the addition of Hapag-Lloyd. Moreover, we are in the process of completing an important refinancing of three of our vessels, which is expected to lower the debt amortization schedule and the weighted average interest margin we currently have under our 2017 credit facility, while also generating additional liquidity for the Partnership to fuel further growth. In addition, we have now successfully completed the scrubber retrofit on four of our vessels out of a total of seven vessels scheduled for scrubber retrofit and delivered them under their respective charters. Last but not least, we have increased our fourth quarter 2019 common unit distribution by approximately 11% and set forth a new quarterly distribution guidance of $0.35 per common unit. The distribution increase in advance of the earnings impact of the three-vessel acquisition demonstrates the Partnership's confidence in its ability going forward to continue to grow its asset base, combined with a substantial quarterly common unit distribution."