Danaos Corporation Reports First Quarter Results for the Period Ended March 31, 2019
ATHENS, Greece, May 13, 2019 /PRNewswire/ -- Danaos Corporation ("Danaos") (NYSE: DAC), one of the world's largest independent owners of containerships, today reported unaudited results for the quarter ended March 31, 2019.
Highlights for the First Quarter Ended March 31, 2019:
-- Adjusted net income(1) of $38.6 million, or $2.53 per share(2), for the
three months ended March 31, 2019 compared to $28.0 million, or $3.56
per share(2), for the three months ended March 31, 2018, an increase of
37.9%.
-- Operating revenues of $112.9 million for the three months ended March
31, 2019 compared to $111.9 million for the three months ended March 31,
2018, an increase of 0.9%.
-- Adjusted EBITDA(1) of $77.5 million for the three months ended March 31,
2019 compared to $76.6 million for the three months ended March 31,
2018, an increase of 1.2%.
-- Total contracted operating revenues were $1.5 billion as of March 31,
2019, with charters extending through 2028 and remaining average
contracted charter duration of 4.7 years, weighted by aggregate
contracted charter hire.
-- Charter coverage of 86% for the next 12 months based on current
operating revenues and 71% in terms of contracted operating days.
-- Effected 1:14 reverse stock split on May 2, 2019, which the Company
believes will cure the previously announced NYSE deficiency caused by
our stock trading below $1.
-- Concluded sale and leaseback transactions for two 13,100 TEU
containerships on April 12, 2019, resulting in net proceeds of $144.8
million, which were used to repay credit facilities secured by mortgages
on the vessels.
Three Months Ended March 31, 2019
Financial Summary - Unaudited
(
Expressed in thousands of United States dollars, except per share amounts
)
Three months Three months
ended
ended
March 31, March 31,
--- ---
2019 2018
Operating revenues $112,891 $111,854
Net income $33,443 $14,992
Adjusted net income(1) $38,569 $27,951
Earnings per share, diluted(2) $2.19 $1.91
Adjusted earnings per share, diluted1,2 $2.53 $3.56
Diluted weighted average number of shares (in thousands)(2) 15,237 7,843
Adjusted EBITDA(1) $77,538 $76,638
(1) Adjusted net income, adjusted
earnings per share and adjusted
EBITDA are non-GAAP measures.
Refer to the reconciliation of
net income to adjusted net
income and net income to
adjusted EBITDA.
2 Earnings per share and weighted
average number of shares give
retroactive effect to the
reverse stock split of 1-for-
14 implemented on May 2, 2019,
for both periods presented.
Danaos' CEO Dr. John Coustas commented:
"Danaos Corporation's adjusted net income of $38.6 million, or $2.53 per share, for the first quarter of 2019 increased by $10.6 million, or 37.9%, when compared to the first quarter of 2018. This improvement was primarily the result of a $7.6 million decrease in net finance expenses and a $2 million decrease in total operating costs, combined with a $1 million increase in operating revenues due to improved fleet utilization. Adjusted EBITDA for the first quarter of 2019 was $77.5 million, $0.9 million higher than the first quarter of 2018.
"Effective May 2, 2019, following approval of our shareholders and our Board, we effected a 1:14 reverse stock split, which we believe will cure the previously announced NYSE deficiency caused by our stock trading below $1.
"At the beginning of April we concluded a $150 million sale and leaseback transaction for two 13,100 TEU vessels, fulfilling a requirement from the re-financing we concluded last August. The net proceeds of the transaction were used to prepay certain credit facilities that had financed the vessels. Under the terms of the transaction, the Company will re-acquire the vessels at the end of their five-year lease periods.
"The charter market for vessels over 5,500 TEU has seen significant improvement when compared to the recent lows of the fourth quarter of 2018. In general, the charter market for larger vessels has improved considerably, which is notable as more than 70% of our fleet in terms of capacity, is comprised of such vessels. Vessels below 5,500 TEU have also improved slightly since last November's downturn.
"On the investment side, we have recently concluded our first scrubber installation on a vessel owned by Gemini Shipholdings Corporation, an entity in which Danaos has a 49% shareholding interest, and will proceed with installing scrubbers on a further nine vessels wholly-owned by Danaos and one additional vessel owned by Gemini over the next few months.
"Our total contracted revenues as of March 31, 2019 were $1.5 billion, and we maintain our high charter contract coverage of 86% in terms of operating revenues and 71% in terms of operating days over the next 12 months. This insulates us from near-term market weakness.
"Danaos continues to be a leader in the container shipping industry on the back of a solid track record of operational excellence and technological innovation that allows us to continually deliver high quality service to our customers. At the same time, the recently concluded refinancing transaction further enhances our ability to pursue growth opportunities and our goal of delivering value to our shareholders."
Three months ended March 31, 2019 compared to the three months ended March 31, 2018
During the three months ended March 31, 2019 and March 31, 2018, Danaos had an average of 55 containerships. Our fleet utilization for the three months ended March 31, 2019 was 98.2% compared to 95.6% for the three months ended March 31, 2018.
Our adjusted net income amounted to $38.6 million, or $2.53 per share, for the three months ended March 31, 2019 compared to $28.0 million, or $3.56 per share, for the three months ended March 31, 2018 (after giving retroactive effect to the reverse stock split of 1-for-14 implemented on May 2, 2019). We have adjusted our net income in the three months ended March 31, 2019 for a non-cash fees amortization and accrued finance fees charge of $5.1 million. Please refer to the Adjusted Net Income reconciliation table, which appears later in this earnings release.
The increase of $10.6 million in adjusted net income for the three months ended March 31, 2019 compared to the three months ended March 31, 2018 is attributable mainly to a $7.6 million decrease in net finance expenses, a $2.0 million decrease in total operating expenses and a $1.0 million increase in operating revenues.
On a non-adjusted basis, our net income amounted to $33.4 million, or $2.19 earnings per diluted share, for the three months ended March 31, 2019 compared to net income of $15.0 million, or $1.91 earnings per diluted share, for the three months ended March 31, 2018 (after giving retroactive effect to the reverse stock split of 1-for-14).
Operating Revenues
Operating revenues increased by 0.9%, or $1.0 million, to $112.9 million in the three months ended March 31, 2019 from $111.9 million in the three months ended March 31, 2018.
Operating revenues for the three months ended March 31, 2019 reflect:
-- $0.9 million increase in revenues due to higher fleet utilization of our
vessels in the three months ended March 31, 2019 compared to the three
months ended March 31, 2018.
-- $0.1 million increase in revenues in the three months ended March 31,
2019 compared to the three months ended March 31, 2018 due to the
re-chartering of certain of our vessels at higher rates.
Vessel Operating Expenses
Vessel operating expenses decreased by 3.4%, or $0.9 million, to $25.9 million in the three months ended March 31, 2019 from $26.8 million in the three months ended March 31, 2018. The average daily operating cost per vessel for vessels on time charter was $5,636 per day for the three months ended March 31, 2019 compared to $5,849 per day for the three months ended March 31, 2018. Management believes that our daily operating cost ranks as one of the most competitive in the industry.
Depreciation & Amortization
Depreciation & Amortization includes Depreciation and Amortization of Deferred Dry-docking and Special Survey Costs.
Depreciation
Depreciation expense decreased by 12.2%, or $3.3 million, to $23.8 million in the three months ended March 31, 2019 from $27.1 million in the three months ended March 31, 2018 mainly due to decreased depreciation expense for ten vessels for which we recorded an impairment charge on December 31, 2018.
Amortization of Deferred Dry-docking and Special Survey Costs
Amortization of deferred dry-docking and special survey costs increased by $0.4 million, to $2.2 million in the three months ended March 31, 2019 from $1.8 million in the three months ended March 31, 2018. The increase was mainly due to an increased number of vessels dry-docked.
General and Administrative Expenses
General and administrative expenses increased by $1.7 million, to $6.9 million in the three months ended March 31, 2019, from $5.2 million in the three months ended March 31, 2018. The increase was mainly due to increased share based compensation and professional fees.
Other Operating Expenses
Other Operating Expenses include Voyage Expenses.
Voyage Expenses
Voyage expenses increased by $0.1 million, to $3.3 million in the three months ended March 31, 2019 from $3.2 million in the three months ended March 31, 2018.
Interest Expense and Interest Income
Interest expense decreased by 21.9%, or $5.0 million, to $17.8 million in the three months ended March 31, 2019 from $22.8 million in the three months ended March 31, 2018. The decrease in interest expense is attributable to:
(i) a $11.4 million decrease in interest expense on two of our credit facilities for which we have recognized an interest expense accrual, which has been classified on our balance sheet under "Accumulated accrued interest" and represents future interest expense for the relevant facilities that has been recognized in advance as a result of the application of Troubled Debt Restructuring ("TDR") accounting in connection with our 2018 debt refinancing;
(ii) a $4.0 million increase in interest expense due to an increase in debt service cost of approximately 2.3%, partially offset by a $645.1 million decrease in our average debt, to $1,656.3 million in the three months ended March 31, 2019, compared to $2,301.4 million in the three months ended March 31, 2018; and
(iii) a $2.4 million increase in the amortization of deferred finance costs and debt discount related to our 2018 debt refinancing.
As of March 31, 2019, debt outstanding, gross of deferred finance costs, was $1,641.7 million compared to $2,299.9 million as of March 31, 2018.
Interest income increased by $0.2 million to $1.6 million in the three months ended March 31, 2019 compared to $1.4 million in the three months ended March 31, 2018.
Other finance costs, net
Other finance costs, net decreased by $0.7 million to $0.3 million in the three months ended March 31, 2019 compared to $1.0 million in the three months ended March 31, 2018 mainly due to decreased exit fees expenses.
Equity income/(loss) on investments
Equity income/(loss) on investments decreased by $0.1 million to a $0.1 million loss on investments in the three months ended March 31, 2019 and relates to the operating performance of Gemini Shipholdings Corporation, in which the Company has a 49% shareholding interest.
Loss on derivatives
Amortization of deferred realized losses on interest rate swaps remained stable at $0.9 million in each of the three months ended March 31, 2019 and 2018.
Other income/(expenses), net
Other income/(expenses), net was nil in the three months ended March 31, 2019 compared to $9.4 million in expenses in the three months ended March 31, 2018 mainly due to $9.6 million of refinancing-related professional fees in the prior period.
Adjusted EBITDA
Adjusted EBITDA increased by 1.2%, or $0.9 million, to $77.5 million in the three months ended March 31, 2019 from $76.6 million in the three months ended March 31, 2018. As outlined above, the increase is mainly attributable to a $1.0 million increase in operating revenues and a $0.1 million decrease in operating performance on our equity investments. Adjusted EBITDA for the three months ended March 31, 2019 is adjusted for stock based compensation of $0.8 million. Tables reconciling Adjusted EBITDA to Net Income can be found at the end of this earnings release.
Recent Developments
On April 12, 2019, we completed the refinancing of two of our 13,100 TEU vessels, the Hyundai Honour and Hyundai Respect through a sale and leaseback arrangement with a term of five years at the end of which we will reacquire the vessels. The net proceeds amounting to $144.8 million were applied pro rata to repay the existing credit facilities secured by mortgages on these vessels.
At our Special Meeting of Stockholders on March 5, 2019, our shareholders approved an amendment to our Restated Articles of Incorporation to effect a reverse stock split of the issued and outstanding shares of common stock with the exact ratio to be determined by the Board of Directors. On April 16, 2019, our Board of Directors determined to effect a reverse stock split of our issued and outstanding shares of common stock by a ratio of 1-for-14. The reverse stock split occurred, and our common stock began trading on a split adjusted basis as of the opening of trading on the NYSE on May 2, 2019 under the existing trading symbol "DAC". The reverse stock split reduced the number of our outstanding shares of common stock from 213,324,455 to 15,237,456 and affected all issued and outstanding shares of common stock. No fractional shares were issued in connection to the reverse stock split. Stockholders who would otherwise hold a fractional share of our common stock received a cash payment in lieu of such fractional share. The par value and other terms of our common stock were not affected by the reverse stock split. All share and per share data in this Earnings Release give retroactive effect to this reverse stock split, for both periods presented.
Conference Call and Webcast
On Tuesday, May 14, 2019 at 9:00 A.M. ET, the Company's management will host a conference call to discuss the results.
Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1 844 802 2437 (US Toll Free Dial In), 0800 279 9489 (UK Toll Free Dial In) or +44 (0) 2075 441 375 (Standard International Dial In). Please indicate to the operator that you wish to join the Danaos Corporation earnings call.
A telephonic replay of the conference call will be available until May 21, 2019 by dialing 1 877 344 7529 (US Toll Free Dial In) or +44 (0) 2036 088 021 (Standard International Dial In) and using 10131488# as the access code.
Audio Webcast
There will also be a live and then archived webcast of the conference call, including a slide presentation providing additional company information, through the Danaos website (www.danaos.com). Participants of the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.
About Danaos Corporation
Danaos Corporation is one of the largest independent owners of modern, large-size containerships. Our current fleet of 59 containerships aggregating 351,614 TEUs, including four vessels owned by Gemini Shipholdings Corporation, a joint venture, ranks Danaos among the largest containership charter owners in the world based on total TEU capacity. Our fleet is chartered to many of the world's largest liner companies on fixed-rate charters. Our long track record of success is predicated on our efficient and rigorous operational standards and environmental controls. Danaos Corporation's shares trade on the New York Stock Exchange under the symbol "DAC".
Forward-Looking Statements
Matters discussed in this release may constitute forward-looking statements within the meaning of the safe harbor provisions of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements reflect our current views with respect to future events and financial performance and may include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements, which are other than statements of historical facts. The forward-looking statements in this release are based upon various assumptions. Although Danaos Corporation believes that these assumptions were reasonable when made, because these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control, Danaos Corporation cannot assure you that it will achieve or accomplish these expectations, beliefs or projections. Important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the effects of the refinancing transactions; Danaos' ability to achieve the expected benefits of the refinancing and comply with the terms of its new credit facilities and other agreements entered into in connection with the refinancing; the strength of world economies and currencies, general market conditions, including changes in charter hire rates and vessel values, charter counterparty performance, changes in demand that may affect attitudes of time charterers to scheduled and unscheduled dry-docking, changes in Danaos Corporation's operating expenses, including bunker prices, dry-docking and insurance costs, ability to obtain financing and comply with covenants in our financing arrangements, actions taken by regulatory authorities, potential liability from pending or future litigation, domestic and international political conditions, potential disruption of shipping routes due to accidents and political events or acts by terrorists.
Risks and uncertainties are further described in reports filed by Danaos Corporation with the U.S. Securities and Exchange Commission.
Visit our website at www.danaos.com
Appendix
Fleet Utilization
Danaos had 90 unscheduled off-hire days in the three months ended March 31, 2019. The following table summarizes vessel utilization and the impact of the off-hire days on the Company's revenue.
Vessel Utilization (No. of Days) First First
Quarter Quarter
---
2019 2018
--- ---
Ownership Days 4,950 4,950
Less Off-hire Days:
Scheduled Off-hire Days (125)
Other Off-hire Days (90) (91)
Operating Days 4,860 4,734
Vessel Utilization 98.2% 95.6%
Operating Revenues (in '000s of US Dollars) $112,891 $111,854
Average Gross Daily Charter Rate $23,229 $23,628
Fleet List
The following table describes in detail our fleet deployment profile as of May 13, 2019:
Vessel Name Vessel Size Year
Expiration of Charter(1)
(TEU) Built
---
Containerships
---
MSC Ambition 13,100 2012
June 2024
Maersk Exeter 13,100 2012
June 2024
Maersk Enping 13,100 2012
May 2024
Hyundai
Respect 13,100 2012
March 2024
Hyundai Honour 13,100 2012
February 2024
Express Rome 10,100 2011
February 2022
Express Berlin 10,100 2011
April 2022
Express Athens 10,100 2011
February 2022
Le Havre 9,580 2006
December 2022
Pusan C 9,580 2006
November 2022
CMA CGM
Melisande 8,530 2012
May 2024
CMA CGM Attila 8,530 2011
October 2023
CMA CGM
Tancredi 8,530 2011
November 2023
CMA CGM Bianca 8,530 2011
January 2024
CMA CGM Samson 8,530 2011
March 2024
America 8,468 2004
January 2023
Europe 8,468 2004
December 2022
CMA CGM
Moliere 6,500 2009
August 2021
CMA CGM Musset 6,500 2010
August 2022
CMA CGM Nerval 6,500 2010
October 2022
CMA CGM
Rabelais 6,500 2010
December 2022
CMA CGM Racine 6,500 2010
January 2023
YM Mandate 6,500 2010
January 2028
YM Maturity 6,500 2010
April 2028
Performance 6,402 2002
June 2019
Dimitra C 6,402 2002
January 2020
YM Seattle 4,253 2007
July 2019
YM Vancouver 4,253 2007
September 2019
Derby D 4,253 2004
May 2019
ANL Tongala 4,253 2004
June 2019
ZIM Rio Grande 4,253 2008
May 2020
ZIM Sao Paolo 4,253 2008
August 2020
ZIM Kingston 4,253 2008
September 2020
ZIM Monaco 4,253 2009
November 2020
ZIM Dalian 4,253 2009
February 2021
ZIM Luanda 4,253 2009
May 2021
Dimitris C 3,430 2001
June 2019
Express Black
Sea 3,400 2011
November 2019
Express Spain 3,400 2011
June 2019
Express
Argentina 3,400 2010
June 2019
Express Brazil 3,400 2010
July 2019
Express France 3,400 2010
September 2019
Singapore 3,314 2004
October 2019
Colombo 3,314 2004
February 2020
MSC Zebra 2,602 2001
September 2020
Amalia C 2,452 1998
August 2019
Danae C 2,524 2001
January 2020
Advance 2,200 1997
July 2019
Future 2,200 1997
June 2019
Sprinter 2,200 1997
June 2019
Stride 2,200 1997
August 2019
Progress C 2,200 1998
June 2019
Bridge 2,200 1998
August 2019
Highway 2,200 1998
June 2019
Vladivostok 2,200 1997
October 2019
Catherine C
(2) 6,422 2001
November 2022
Leo C (2) 6,422 2002
November 2022
Suez Canal(2) 5,610 2002
June 2019
Genoa?2) 5,544 2002
July 2019
(1) Earliest date charters could
expire. Some charters include
options to extend their terms.
(2) Vessels acquired by Gemini
Shipholdings Corporation, in
which Danaos holds a 49% equity
interest.
DANAOS CORPORATION
Condensed Consolidated Statements of Income - Unaudited
(Expressed in thousands of United States dollars, except per share amounts)
Three
Three
months
months
ended e
nded
March 31, March 31,
--- ---
2019 2018
OPERATING REVENUES $112,891 $111,854
OPERATING EXPENSES
Vessel operating expenses (25,871) (26,849)
Depreciation & amortization (25,957) (28,903)
General & administrative (6,869) (5,182)
Other operating expenses (3,270) (3,161)
Income From Operations 50,924 47,759
---
OTHER INCOME/(EXPENSES)
Interest income 1,596 1,375
Interest expense (17,843) (22,849)
Other finance expenses (324) (971)
Equity income/(loss) on investments (84) (26)
Other income/(expenses), net 67 (9,385)
Realized loss on derivatives (893) (911)
Total Other Expenses, net (17,481) (32,767)
---
Net Income $33,443 $14,992
===
EARNINGS PER SHARE
Basic earnings per share(1) $2.24 $1.91
===
Diluted earnings per share(1) $2.19 $1.91
===
Basic weighted average number of common shares (in thousands of shares)(1) 14,939 7,843
Diluted weighted average number of common shares (in thousands of shares)(1) 15,237 7,843
Non-GAAP Measures(2)
Reconciliation of Net Income to Adjusted Net Income - Unaudited
Three Three
months months
ended ended
March
31, March 31,
--- ---
2019 2018
Net income $33,443 $14,992
Amortization of financing fees, debt discount & finance fees accrued 5,126 3,351
Refinancing professional fees - 9,608
---
Adjusted Net Income $38,569 $27,951
Adjusted Earnings Per Share, diluted(1) $2.53 $3.56
Diluted weighted average number of shares (in thousands)(1) 15,237 7,843
1 Basic and diluted earnings per
share and basic and diluted
weighted average number of shares
give retroactive effect to the 1-
for-14 reverse stock split, for
both periods presented.
(2) The Company reports its financial
results in accordance with U.S.
generally accepted accounting
principles (GAAP). However,
management believes that certain
non-GAAP financial measures used
in managing the business may
provide users of this financial
information additional meaningful
comparisons between current
results and results in prior
operating periods. Management
believes that these non-GAAP
financial measures can provide
additional meaningful reflection
of underlying trends of the
business because they provide a
comparison of historical
information that excludes certain
items that impact the overall
comparability. Management also
uses these non-GAAP financial
measures in making financial,
operating and planning decisions
and in evaluating the Company's
performance. See the Table above
for supplemental financial data
and corresponding reconciliations
to GAAP financial measures for the
three months ended March 31, 2019
and 2018. Non-GAAP financial
measures should be viewed in
addition to, and not as an
alternative for, the Company's
reported results prepared in
accordance with GAAP.
DANAOS CORPORATION
Condensed Consolidated Balance Sheets - Unaudited
(Expressed in thousands of United States dollars)
As of
As of
March 31, December 31,
--- ---
2019 2018
ASSETS
CURRENT ASSETS
Cash and cash equivalents $81,309 $77,275
Accounts receivable, net 7,443 9,225
Other current assets 36,315 33,250
125,067 119,750
NON-CURRENT ASSETS
Fixed assets, net 2,456,891 2,480,329
Deferred charges, net 10,961 13,031
Investments in affiliates 7,279 7,363
Other non-current assets 64,204 59,369
2,539,335 2,560,092
TOTAL ASSETS $2,664,402 $2,679,842
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Long-term debt, current portion $112,588 $113,777
Accumulated accrued interest, current portion 35,543 35,782
Accounts payable, accrued liabilities & other current liabilities 67,104 73,142
215,235 222,701
LONG-TERM LIABILITIES
Long-term debt, net 1,488,033 1,508,108
Accumulated accrued interest, net of current portion 189,177 200,574
Other long-term liabilities 46,543 57,606
1,723,753 1,766,288
STOCKHOLDERS' EQUITY
Common stock(1) 152 152
Additional paid-in capital(1) 728,392 727,562
Accumulated other comprehensive loss (118,422) (118,710)
Retained earnings 115,292 81,849
725,414 690,853
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $2,664,402 $2,679,842
1 Common stock and Additional
paid-in capital give
retroactive effect to the 1-
for-14 reverse stock split,
for both periods presented.
DANAOS CORPORATION
Condensed Consolidated Statements of Cash Flows - Unaudited
(Expressed in thousands of United States dollars)
Three Three
months months
ended ended
March 31, March 31,
--- ---
2019 2018
Operating Activities:
Net income $33,443 $14,992
Adjustments to reconcile net income to net cash
provided by operating activities:
Depreciation 23,766 27,060
Amortization of deferred drydocking & special
survey costs, finance cost, debt discount and
other finance fees accrued 7,317 5,194
PIK interest 840
Payments for drydocking/special survey (121) (6,393)
Amortization of deferred realized losses on
cash flow interest rate swaps 893 911
Equity loss on investments 84 26
Stock based compensation 830
Accounts receivable 1,782 (239)
Other assets, current and non-current (7,166) (6,712)
Accounts payable and accrued liabilities 918 6,636
Other liabilities, current and long-term (3,584) (5,886)
Net Cash provided by Operating Activities 59,002 35,589
Investing Activities:
Vessel additions and advances (1,667) (716)
Net Cash used in Investing Activities (1,667) (716)
Financing Activities:
Debt repayment (29,714) (41,601)
Payments of accumulated accrued interest (9,100)
Finance costs (14,487)
Net Cash used in Financing Activities (53,301) (41,601)
Net Increase/(Decrease) in cash, cash equivalents and restricted cash 4,034 (6,728)
Cash, cash equivalents and restricted cash, beginning of period 77,275 69,707
Cash, cash equivalents and restricted cash, end of period $81,309 $62,979
DANAOS CORPORATION
Reconciliation of Net Income to Adjusted EBITDA -
Unaudited
(Expressed in thousands of United States dollars)
Three months
ended
March
31,
---
2019
Net income $33,443
Depreciation 23,766
Amortization of deferred
drydocking & special survey
costs 2,191
Amortization of deferred finance
costs, debt discount and other
finance fees 5,126
accrued
Amortization of deferred realized
losses on interest rate swaps 893
Interest income (1,596)
Interest expense 12,885
Stock based compensation 830
Refinancing professional fees -
Adjusted EBITDA(1) $77,538
1) Adjusted EBITDA represents net
income before interest income and
expense, depreciation,
amortization of deferred
drydocking & special survey costs,
amortization of deferred finance
costs, debt discount and other
finance fees accrued, amortization
of deferred realized losses on
interest rate swaps, stock based
compensation and refinancing
professional fees. However,
Adjusted EBITDA is not a
recognized measurement under U.S.
generally accepted accounting
principles, or "GAAP." We believe
that the presentation of Adjusted
EBITDA is useful to investors
because it is frequently used by
securities analysts, investors and
other interested parties in the
evaluation of companies in our
industry. We also believe that
Adjusted EBITDA is useful in
evaluating our operating
performance compared to that of
other companies in our industry
because the calculation of
Adjusted EBITDA generally
eliminates the effects of
financings, income taxes and the
accounting effects of capital
expenditures and acquisitions,
items which may vary for different
companies for reasons unrelated to
overall operating performance. In
evaluating Adjusted EBITDA, you
should be aware that in the future
we may incur expenses that are the
same as or similar to some of the
adjustments in this presentation.
Our presentation of Adjusted
EBITDA should not be construed as
an inference that our future
results will be unaffected by
unusual or non-recurring items.
Note: Items to consider for
comparability include gains and
charges. Gains positively
impacting net income are reflected
as deductions to net income.
Charges negatively impacting net
income are reflected as increases
to net income.
The Company reports its financial
results in accordance with U.S.
generally accepted accounting
principles (GAAP). However,
management believes that certain
non-GAAP financial measures used
in managing the business may
provide users of these financial
information additional meaningful
comparisons between current
results and results in prior
operating periods. Management
believes that these non-GAAP
financial measures can provide
additional meaningful reflection
of underlying trends of the
business because they provide a
comparison of historical
information that excludes certain
items that impact the overall
comparability. Management also
uses these non-GAAP financial
measures in making financial,
operating and planning decisions
and in evaluating the Company's
performance. See the Tables above
for supplemental financial data
and corresponding reconciliations
to GAAP financial measures for the
three months ended March 31, 2019
and 2018. Non-GAAP financial
measures should be viewed in
addition to, and not as an
alternative for, the Company's
reported results prepared in
accordance with GAAP.
View original content:http://www.prnewswire.com/news-releases/danaos-corporation-reports-first-quarter-results-for-the-period-ended-march-31-2019-300849068.html
SOURCE Danaos Corporation
