Thank you for standing by and welcome to the Capital Product Partners Third Quarter 2014 Financial Results Conference Call. We have with us Mr. Petros Christodoulou, Chief Executive Officer and Chief Financial Officer of the company, and Mr. Jerry Kalogiratos, Chief Operating Officer. At this time all participants are in a listen-only mode. There will be a presentation followed by a question-and-answer session (Operator Instructions). I must advise you that this conference is being recorded today, on Thursday, October 30, 2014. The statements in today’s conference call, that are not historical facts, including our expectations regarding developments in the markets, our expected charter coverage ratios for 2014 and 2015 and expectations regarding our quarterly distribution may be forward-looking statements such as 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 to actual results or otherwise. We assume no responsibility to the accuracy and completeness of the forward-looking statements. We make no prediction or statements about the performance of our common units. And I would now like to hand over to one of our speaker today, Mr. Christodoulou. Please go ahead, sir.

Thank you, Kate, and thank you all for joining us today. As a reminder, we will be referring to the supporting slides available on our website, as we go through today’s presentation. On October 23, 2014, our Board of Directors declared a cash distribution of $0.2325 per common unit for the third quarter of 2014, in line with management’s annual distribution guidance. The third quarter common unit cash distribution will be paid on November 14, to unitholders of record on November 7. The Partnership’s operating surplus for the quarter amounted to $29.8 million, which is $4 million higher than the $25.8 million of the third quarter of 2013. Common Unit coverage for the third quarter of 2014 stood at 1.1 times. As previously announced, the Partnership has agreed to acquire from our sponsor Capital Maritime & Trading Corporation, three eco-flex 9,000 TEU container vessels and two eco medium range product tankers for delivery in 2015. The container vessels come with five-year employment to the CMA and the MRs with two-year charters to Capital Maritime. To remind you, the consideration of $311.5 million for this five vessel acquisition was $36.4 million below fair market value as of August 21, 2014, and was agreed in exchange for the resetting of the incentive distribution rights as approved by the Partnership’s AGM on that date. In September 2014, the Partnership raised net proceeds over $173.5 million from the issuance of 17,250,000 common units, which will be used to partially fund the acquisition of these five vessels from Capital Maritime. During the quarter, the Partnership secured or extended the employment for a number of its vessels including the M/T Miltiadis M II to PEMEX until April 2015, at an increased rate by $4,800 per day, the M/T Alkiviadis to Total S.A. and the M/T Avax…

Thank you, very much. (Operator Instructions) And your first question comes from the line of Amit Mehrotra from Deutsche Bank. Please go ahead.

Yes, hi. Thank you very much and congrats on a good release and outlook. My first question is on the growth strategy. You just mentioned the phrase, entering a new growth phase and the company has been using that for some time now, and it sounds very good. But may be help us understand, what this could mean in terms of value accruing to the Limited Partners, a new growth phase to me sort of implies double-digit distribution growth for the next several years. Is that in the ballpark of how you are thinking about the evolution of the company, if you can just provide a little bit more tangible framework on what entering a new growth phase means, I think that will be helpful?

I have been on the job for the past 40 days, and I need slightly more time to be able to quantify the growth. At the same time, we have the five vessel dropdown starting in Q1 2015, and actually before they even start producing, we feel confident to be able to tell from now, two quarters in advance, that we’ll have a distribution growth. Now, the size of that growth will allow me to be able to put more clarity on this when we said we are going to do it, which is in Q1 2015.

Okay. Okay, that’s fair. If I can just ask a follow-up, it looks like the tankers that are expiring in the next 12 months to 18 months it looks like there is good potential for those re-charters to be significantly accretive, if the recent rate trends continue. If that’s the case that would drive obviously some significant organic growth in the cash flow of the company, but that incremental cash flow in your view essentially all dropped down to the Limited Partners or would you chose to increase the coverage ratio to reinvest the cash down the road for future growth opportunities?

Hi Amit, this is Jerry. We will be definitely wondering the period markets for improvement and for opportunities to charter our ships at the higher rates. Of course, first we have to see sustainable improvement across all segments. And when and if we see numbers that make sense and are closer to the historical averages, we need to fix longer and then define our strategies. So I think as we – over the next couple of quarters and as tanker markets recover, we will be in a better position to see how we will take advantage of this additional cash flow if it comes.

Right, but just – may be just a follow-up on that, in terms of the coverage ratio though, I mean are you guys happy with the 1.1 times where you’re now or do you see that changing at all over the next, call it year, 18 months?

No, at the moment we are staying at 1.1 times. And just to underlining what Jerry said, we feel very good about the crude and product market going forward, as we have a very reserved optimism, but optimism with these and we will – we would don’t like to make strong statements before we see things materialize. So we don’t want to overpromise, but we feel about good about it. That’s all we can say at the moment.

Okay, may be one more housekeeping question. What was the period end common units outstanding in the quarter?

Okay, the current common units outstanding is 104,079,960.

Great. Great. Thank you very much.

The GP is at 2,124,081. So the total common units including the GP is 106,204,041.

Perfect. Thank you so much.

Thank you.

Thank you. And your next question comes from the line of Jon Chappell from Evercore. Please go ahead.

Thank you. Good afternoon. Petros, I wanted to ask about the 1Q timeframe around the distribution increase. I think that’s good that you put some clarity around the timing of it based on when these five new vessels are being delivered. Without giving any details around the magnitude of it, how much of a potential dividend distribution increase will be based on just the EBITDA contribution from these five committed vessels versus may be your views on the market outlook? Because over the last few quarters, there has been kind of a theme that a distribution increase would be reliant on an improvement in the product tanker market. It’s finally starting to happen, of course, it’s also a very volatile market. So how much of this will be market versus just visible acquisition strategy?

We are basing our plan on the increasing our fleet and the five vessel dropdown. At the moment, we are not making any – we feel good about the distribution growth on the base of this, not take into account the rate increase.

Okay, good. And then just a follow-up to the six optional MRs, and then also the three potential VLCCs, just a two-part question there. One, is there some type of an omnibus agreement associated with these? I know you have a right of first refusal, but do they need to have certain duration of contract on the back of them, before they could be dropdown or acquired from Capital Maritime? And then two, how do you think of the financing capabilities for these vessels?

Okay. Now, these are potential dropdowns after we acquire the five vessels, right? Jon Chappell – Evercore: Yes.

Now, you’re – we will be looking at the – we will be taking a look at the market at that time, the state of the modular market, it’s too early to make a call at least what is it now, a year ahead.

Okay, but do they require contracts, before they could be dropped down or could you take them speculatively and place them on the spot market for a short period of time?

No. As you see, we are taking vessels with time charters. We believe this strong market now developing in the products and the crude space will stay, and I think we will be able – even before the end of this year to (indiscernible) some decent strength to manifest it from the time charter market for these vessels.

Okay. Thank you very much.

We are not looking to take any spot.

Alright. So reading between the lines, you would expect Capital Maritime to look to employ some of these nine optional vessels on time charters, because of the recent strengthening in the market, and then something that you would look at?

Ideally, they are looking for long-term charters, and once they have them in place, then we will look at our options here on this end.

Okay, great. Thank you for that.

Yes. And I will pass you – transfer your first part of your question, I will pass it to Jerry.

Hi, Jon. The right of first refusal that’s under the March acquisition agreement provides for a right of first refusal if Capital Maritime decides to sell their ships. So CPLP will have the charters then. But there is also an omnibus agreement with Capital Maritime, so in case those ships that takes for longer than a year, then CPLP will also have the option to acquire them with the charter if accretive. So you have a – if you want a two-fold option there.

Got it. Alright, thanks for the clarification Jerry. Thanks Petros.

Thank you. And your next question comes from the line of Ben Nolan from Stifel. Please go ahead.

Yes, thanks. My first question, I have a few, is in relation to the B shares, and I know a portion of those were converted into regular common units in the quarter, but there is still some outstanding. Would you expect the balance of those to be converted or how should we think about where those are positioned from a go-forward basis?

Well, it’s quite difficult to step into the shoes of the holders and make statement. We shared with you what the GP did, which is to convert. We see at times people coming and converting, we had a small conversion also in early September, not by the GP, by somebody else. But, it’s difficult to get into the (ph) acquisition of the investors to be able to anticipate that. I can make a – I would not even want to risk a guess.

Okay.

I know what I would do if I were them, but I’m doing any, so.

Okay, that’s helpful. The – I guess my next question relates to sort of how you’re thinking about the vessels that you do have on charter and you sort of discussed this a little bit, there’s a fair number of both product tankers and Suezmax’s that are rolling off contract currently. A few of those have been re-fixed on to time charter – new time charter contracts. Although lately, specifically in the product tanker market rates had increased somewhat, and to the extent that they continue to do so, it could provide opportunities to re-fix assets at better prices, and it had been the case over the first part of the year. My question is, how are you thinking about at this point duration on those contracts? I mean, if rates gets a little bit better, are you willing to sort of look longer duration instead of 12 months to 24 months, may be looking 3 years to 5 years or do you think that there’s not a – the market is not strong enough yet to go out longer term like that?

Look, at the moment we have been – as you see, we have been enrolling fixes for a year or 1 plus 1. As we see the market and hopefully the market will continue to strengthen and the period markets were strengthening, we are not going to sort of play although nothing, we will just slowly extend the period charters. And as it trends towards the if you like (indiscernible) revert and close them in, we would need to – we would look to stretch out the period charters.

Okay. And then my last question is, obviously you laid out what other potential dropdown candidates would be that are held at Capital Maritime. Should we think of that as sort of the pretty close to the exclusive universal candidates or in other words should we only think at the moment of Capital Maritime as the only logical candidate to provide acquisition targets? Are you guys also out there actively pursuing sale leaseback opportunities or what have you away from the sponsor?

Well, first of all, it’s very good to have a sponsor that’s very active in the space and provide us with opportunities and options. But needless to say that we are looking number of projects every day. The market as of late is ripening up to show us – to present more opportunities. We are open to look at, beyond the five vessels that we have committed and contracted to acquire from the Capital Maritime. For all the rest we – for other ones we have an option like in the case of the six MRs, otherwise we do have an option, but we will look at them in the case of the crudes, the VLCCs and we are also looking at various other opportunities that we will open up.

Okay, alright. That’s it from my questions. I appreciate it. Thank you.

Thank you.

Thank you. And your next question comes from the line of Michael Webber from Wells Fargo. Please go ahead.

Hey, good morning guys. How are you?

Hi.

Hi. I just wanted to go back and revisit the growth guidance just one more time to be completely clear. So, in your press release and in your stated comments, where you talked about going back and revisiting your annual guidance in Q1 2015, just so we can think about this the right way, most of your committed vessels and committed growth are delivering at the midpoint of next year. So you have a couple of years’ worth of kind of forward cash flow growth. Should we be thinking about the Q1 2015 vision as a multi-year growth strategy that you guys are going to layout or is this going to be kind of a one-off either Q1 or 2015 distribution book?

It’s more than Q1 and more than 2015.

Okay. Okay. That’s helpful. And then I guess looking at the additional growth beyond that, which is just (indiscernible) to have in addition to what you guys have already committed. How do you think about – you mentioned getting third-party counterparties for the Vs and for the MRs and waiting for the market to share off, there are a lot of things that need to go right for that to happen relatively quickly aiming to provide a more visible growth ramps. What’s the thought process behind chartering the Bs or the MRs back to the parent and then using them as dropdown. Are they kind of pushing out the risk associated with securing a counterparty and competing with other owners came out beyond the MLP?

Yes. As the Capital Maritime has stood by us to support us as I said before at times when there is no period – well not good period rates, all the market was going through a soft spot. We are not – we don’t want to rely on Capital Maritime. We believe that once the market strengthens, we have opportunity to broaden our third-party time charters. We will look to do that. And we will always keep the cushion of Capital Maritime for the rainy days.

Got you. And one more and I will turn it over. Maybe if I have missed, the thought process behind the $30 million advance from the Partnership reverting around the transaction seems a bit unorthodox. Can you may be talk to the rationale there or am I missing something relatively straight forward?

Yes. I mean, in terms of these five vessels to be dropped down next year, the Capital Maritime had already made certain advances to the shipyards. And which as it’s customarily we, the CPLP made $30 million advance, which you’ll be seeing in our balance sheet ahead of these dropdowns.

Okay. So just purely it cover the carrying costs of the parent would have born over the delivery cycle, is it all?

That is correct. Yeah.

Okay. Alright, I appreciate the time guys. Thank you.

Thank you.

(Operator Instructions) And your next question comes from the line of Shawn Collins from Bank of America. Please go ahead.

Great. Hi, Petros. Hi, Jerry. Good afternoon.

Hello.

Hello. Can you just compare your thoughts on the crude market versus the product market, and which one looks more attractive to you in the future? And on Slide 6, you have thoughts around possible product dropdown and also three crude tanks that are dropped down. Could you just talk about that a bit?

Sure. They are slightly different markets in the sense of where they stand today in terms of the demand and supply picture. But, for both the outlook is quite favorable. On the product tanker side, you have very positive demand fundamentals and quite surely the demand growth because of what we have discussed repeatedly in the past that it’s oil product exporters out of the U.S. Gulf as well as refinery capacity dislocation. These fundamentals if you want, this development will be at their peak next year and in 2016, so we expect growth to be quite strong. On the other hand, on the back of these expectations, we have had a number of orders placed back, over the last couple of years. I think given the solid demand growth, most analysts expect that demand will outpace supply. And the recent spike in spot rates shows that fleet utilizations at those levels that kind of allow for spikes in the earnings would then usually spillover into period rates, which is what we look at. And you already have seen period rates improved by about $500 to $750 for the one-year time charter. On the crude side, it’s slightly different picture, demand is positive, but it’s lower in absolute terms. But because of the very weak rate environment that we have seen in the past, the supply picture is quite favorable. We have a very few orders due for delivery this year and next year, which means that the market has time to balance and demand is now driving rates. So we have seen substantial improvement in spot rates and even more so, on the period side, for example Suezmax rates have recovered one-year rates that is from low $18,000 to $25,000 – $25,500 today, which is a good solid recovery. Of course when you look at historical averages, they are closer to just above 2013 and that’s including a number of very bad years. So I think the remainder of 2014 and 2015 should be also quite favorable for both spot as well as period Suezmax rates.

Okay, great. Thank you for that. And then just following up on that, obviously the price of oil is down substantially over the last several months, down 20%, in the low 80s. Long-term or the next year or two if the price of oil were to stay in this lower range, do you expect this will have a material impact one way or the other on the volume of – the volume in amount of business that you will do?

Well, I guess this has very much to do as to what is driving the fall in the oil price and I think it’s may be too early to say as of yet. Is it the supply glide that you want because of the U.S. Gulf sand oil production or is it demand destruction. It looks more like the former, but I think we have to wait, to see how the main consumers of oil, the ones that are driving demand for oil right now like China and mostly developing countries going forward before we can evaluate the impact of lower oil price on the freight market. But in the short-term to medium-term, it does not seem to affecting volumes at all, if anything is boosting earnings in the spot market because of the lower (indiscernible) prices.

Okay, understood. That make sense, it’s helpful. Okay. Thank you very much for the time and the insight. I appreciate it.

Thank you. (Operator Instructions) There are no further questions coming through at this time gentlemen. I’d now like to hand the conference back to Petros for any closing remarks. Thank you.

Thank you all for participating in this call. We are looking forward to talking to you whenever you feel you have more questions to ask. You have the contact details of the team here. And all details we have on the website, feel free to contact us. And with this, I’d thank you for taking the time in your morning and look forward to talking to you soon again. All the best.

Thank you very much. Ladies and gentlemen that does conclude our conference for today. Thank you all for participating and you may now disconnect.