Capital Clean Energy Carriers Corp. Q4 FY2023 earnings call

• Announced strategic transaction to transform into LNG and energy transition shipping corp on November 13. - Completed $500 million rights offering and acquired 11 latest-generation LNG carriers with deliveries from Q4 2023 to Q1 2027. - Took delivery of LNG Carrier Amore Mio I on December 21 and LNG Carrier Axios II on January 2. - Agreed to sell container vessel Long Beach Express. - Fourth quarter net income was $12.7 million, board declared $0.15 per common unit cash distribution. - Balance sheet: Capital at end of Q4 was $1.175 billion, debt increased to $1.8 billion, cash at quarter end was $104.1 million including restricted cash.

In the fourth quarter of 2023, total revenue was $95.5 million compared to $79.9 million in the same period of 2022. Net income was $12.7 million, or $16.3 million excluding a $3.5 million impairment associated with the sale of two vessels. The partnership's current fleet charter coverage for 2024 is 100% and 82% for 2025, with a contract revenue backlog of $3 billion. Revenue increase was due to new building containers and LNG carrier contributions, offset by sale of a dry bulk vessel. Vessel operating expenses increased due to more vessels in the fleet, and depreciation/amortization rose due to larger fleet size.

• Aim to convert partnership from limited partnership to corporation with customary governance provisions by June 2024. - Plan to take delivery of next three LNG carriers in May, June, and July 2024 with long-term employment in place. - Continue to seek opportunistic divestment of container vessels while achieving reasonable sale prices.

• Forward-looking statements involve risks such as market fundamentals, vessel employment, redelivery dates, and charter rates. - Red Sea security concerns have prompted vessels to avoid certain straits, potentially creating additional demand for LNG vessels but also introducing operational uncertainties.

Q: About the planned corporate conversion from a partnership to a corporation, specifically the deadline of June 2024 and what happens if not done by then.

A: Jerry Kalogiratos said both the GP and partnership are motivated to get the conversion done, it's in early stages, and optimistic it will be concluded earlier than the target date with no direct severe consequences envisioned under the Umbrella Agreement.

Q: About appetite for charters of new LNG builds in a weaker environment.

A: Spyros Leoussis said there's a very strong appetite from charters to charter vessels, uncorrelated to current market, and expect to fix before delivery with interest from various charters including fleet replacement and new LNG production projects.

Q: About cadence of divesting container vessels.

A: Jerry Kalogiratos said there's been significant inquiry for sale of container vessels, they are opportunistic, expect to announce more in the first half of 2024 but won't commit to a specific timeline for divesting all container assets