Danaos Corporation Reports Third Quarter and Nine Months Results for the Period Ended September 30, 2024
ATHENS, Greece, Nov. 12, 2024 /PRNewswire/ -- Danaos Corporation ("Danaos") (NYSE: DAC), one of the world's largest independent owners of container vessels and drybulk vessels, today reported unaudited results for the period ended September 30, 2024.
Highlights for the Third Quarter and Nine Months Ended September 30, 2024:
Financial Summary
Three Months Ended September 30, 2024 and Three Months Ended September 30, 2023
Unaudited
(
Expressed in thousands of United States dollars, except as otherwise stated
)
Three Months Ended
Three Months Ended
September 30, 2024
September 30, 2023
Financial & Operating Metrics Container Drybulk Other Total Container Drybulk Other Total
Vessels Vessels Vessels Vessels
Operating Revenues $235,570 $20,606 $256,176 $239,215 $239,215
Voyage Expenses, excl. commissions $757 $(8,019) $(7,262) $(479) $(479)
Time Charter Equivalent Revenues (1) $236,327 $12,587 $248,914 $238,736 $238,736
Net income/(loss) $124,102 $62 $(1,168) $122,996 $142,173 $(59) $(8,958) $133,156
Adjusted net income / (loss) (2) $125,143 $62 $1,640 $126,845 $142,647 $(59) $375 $142,963
Earnings per share, basic $6.36 $6.76
Earnings per share, diluted $6.30 $6.76
Adjusted earnings per share, diluted (2) $6.50 $7.26
Operating Days 6,387 778 6,115
Time Charter Equivalent $/day (1) $37,001 $16,179 $39,041
Ownership days 6,540 913 6,256
Average number of vessels 71.1 9.9 68.0
Fleet Utilization 97.7 % 85.2 % 97.7 %
Adjusted EBITDA (2) $173,454 $3,826 $1,617 $178,897 $177,701 $(49) $375 $178,027
Consolidated Balance Sheet As of September 30,2024 As of December 31,
2023
& Leverage Metrics
Cash and cash equivalents $384,336 $271,809
Availability under Revolving Credit Facility $303,750 $337,500
Marketable securities(3) $96,423
Total cash liquidity & marketable securities(4) $784,509 $609,309
Debt, gross of deferred finance costs $689,476 $410,516
Net Debt (5) $305,140 $138,707
LTM Adjusted EBITDA (6) $705,497 $707,002
Net Debt / LTM Adjusted EBITDA 0.43x 0.20x
1. Time charter equivalent revenues and time charter equivalent US$/day are non-GAAP measures. Refer to the reconciliation provided in the appendix.
2. Adjusted net income/(loss), adjusted earnings per share and adjusted EBITDA are non-GAAP measures. Refer to the reconciliation of net income to adjusted net income and adjusted earnings per share; and net income to adjusted EBITDA provided below.
3. Marketable securities refer to fair value of 4,070,214 shares of common stock of SBLK on September 30, 2024.
4. Total cash liquidity & marketable securities includes: (i) cash and cash equivalents, (ii) availability under our Revolving Credit Facility and (iii) marketable securities.
5. Net Debt is defined as total debt gross of deferred finance costs less cash and cash equivalents
6. Last twelve months Adjusted EBITDA. Refer to the reconciliation provided below.
For management purposes, the Company is organized based on operating revenues generated from container vessels and dry-bulk vessels and has two reporting segments: (1) a container vessels segment and (2) a dry-bulk vessels segment. The Company measures segment performance based on net income. Items included in the applicable segment's net income are directly allocated to the extent that the items are directly or indirectly attributable to the segments. With regards to the items that are allocated by indirect calculations, their allocation is commensurate to the utilization of key resources. The Other column includes components that are not allocated to any of the Company's reportable segments and includes investments in an affiliate accounted for using the equity method of accounting and investments in marketable securities.
Financial Summary
Nine Months Ended September 30, 2024 and Nine Months Ended September 30, 2023
Unaudited
(
Expressed in thousands of United States dollars, except as otherwise stated
)
Nine Months Ended
Nine Months Ended
September 30, 2024
September 30, 2023
Financial & Operating Metrics Container Drybulk Other Total Container Drybulk Other Total
Vessels Vessels Vessels Vessels
Operating Revenues $699,567 $56,364 $755,931 $724,268 $724,268
Voyage Expenses, excl. commissions $(179) $(22,115) $(22,294) $(1,225) $(1,225)
Time Charter Equivalent Revenues (1) $699,388 $34,249 $733,637 $723,043 $723,043
Net income/(loss) $396,144 $2,689 $15,813 $414,646 $432,283 $(59) $(5,846) $426,378
Adjusted net income / (loss) (2) $391,062 $2,689 $5,418 $399,169 $434,633 $(59) $(2,951) $431,623
Earnings per share, basic $21.41 $21.28
Earnings per share, diluted $21.22 $21.28
Adjusted earnings per share, diluted (2) $20.43 $21.54
Operating Days 18,494 1,978 18,177
Time Charter Equivalent $/day (1) $37,817 $17,315 $39,778
Ownership days 18,978 2,244 18,594
Average number of vessels 69.3 8.2 68.1
Fleet Utilization 97.4 % 88.1 % 97.8 %
Adjusted EBITDA (2) $516,763 $10,730 $5,395 $532,888 $537,393 $(49) $(2,951) $534,393
1. Time charter equivalent revenues and time charter equivalent US$/day are non-GAAP measures. Refer to the reconciliation provided in the appendix.
2. Adjusted net income/(loss), adjusted earnings per share and adjusted EBITDA are non-GAAP measures. Refer to the reconciliation of net income to adjusted net income and adjusted earnings per share; and net income to adjusted EBITDA provided below.
-- During the third quarter of 2024 and through the date of this release,
we took delivery of another 3 newbuilding containerships, namely one
7,165 TEU vessel and two 8,010 TEU vessels which have commenced their
three-year charters. In total, we have taken delivery of 6 newbuilding
containerships in 2024.
-- As a result, our remaining orderbook currently consists of a further 14
newbuilding containership vessels with an aggregate capacity of 115,834
TEU with expected deliveries of two vessels in 2025, three vessels in
2026, seven vessels in 2027 and two vessels in 2028. All the vessels in
our orderbook are designed with the latest eco characteristics, will be
methanol fuel ready, fitted with open loop scrubbers and Alternative
Maritime Power (AMP) units and will be built in accordance with the
latest requirements of the International Maritime Organization (IMO) in
relation to Tier III emission standards and Energy Efficiency Design
Index (EEDI) Phase III.
-- We have now secured multi-year charter arrangements for all of the
vessels in our newbuilding orderbook with an average charter duration of
approximately 4.8 years weighted by aggregate contracted charter hire.
-- Over the past two months, we added approximately $308 million to our
contracted revenue backlog through a combination of new charters and
charter extensions for 16 of our container vessels.
-- As a result, total contracted cash operating revenues, on the basis of
concluded charter contracts through the date of this release, currently
stand at $3.3 billion, including newbuildings. The remaining average
contracted charter duration for our containership fleet is 3.4 years,
weighted by aggregate contracted charter hire.
-- Contracted operating days charter coverage for our container vessel
fleet is currently 100% for 2024, 94% for 2025 and 73% for 2026. This
includes newbuildings based on their scheduled delivery dates.
-- We took delivery of all of our contracted capesize drybulk carriers by
taking delivery of two vessels in the second quarter of 2024 and one
vessel in July 2024. As a result, our capesize drybulk fleet currently
stands at 10 vessels with an aggregate capacity of approximately 1.8
million DWT.
-- As of the date of this release, Danaos has repurchased a total of
1,893,803 shares of its common stock in the open market for $123.2
million under its $200 million authorized share repurchase program that
was originally introduced in June 2022 and upsized in November 2023.
-- Danaos has declared an increased dividend of $0.85 per share of common
stock for the third quarter of 2024, an increase of 6.25%. The dividend
is payable on December 4, 2024, to stockholders of record as of November
25, 2024.
Danaos' CEO Dr. John Coustas commented:
"The container market remained very strong in the third quarter of 2024, allowing us to add over $300 million to our contracted charter backlog which presently stands at $3.3 billion. Importantly, all 14 of our newbuildings on order are fixed for 5 years, except for two that are fixed for 2 years. We have excellent earnings visibility as we have covered 100% of our container vessel fleet operating days for 2024, 94% for 2025 and 73% for 2026.
The dry bulk market has been uncharacteristically soft lately, which can be attributed to a disruption of seasonal patterns throughout the year as well as a decrease in Chinese steel production. Our dry bulk fleet performed reasonably well during the quarter, and we are expecting freight rates to gradually improve as we move into 2025.
Due to the certainty provided by the charter backlog in our container segment, Danaos is insulated from the unstable and unpredictable nature of the current global backdrop. The recent U.S. Presidential election has introduced new uncertainty about future policymaking and its effect in the shipping market. Most notably, President Trump has openly declared his intention to implement or increase trade tariffs that have the potential to decrease container movements or at least will reshuffle trade lanes. Additionally, it is likely that energy transition initiatives will take place at a slower rate, and we don't know to what extent existing IMO initiatives will be supported by the new administration.
Danaos remains in a fortunate and enviable position. In addition to our charter coverage, our balance sheet is a significant strength. I am proud of the efforts we have undertaken, efforts that have been acknowledged by Moody's, who upgraded Danaos to Ba1. Together with the S&P credit rating at BB+, Danaos now holds the highest grade assigned to a pure play shipping company. Our creditworthiness will allow us to explore fully the U.S. bond market, creating opportunity to raise competitively priced capital to continue to opportunistically pursue growth opportunities.
Our continued strong financial performance and accompanying strengthening of our balance sheet has enabled us to increase our quarterly dividend to $0.85 per share, in line with the commitment we have made to our shareholders. We are also continuing to return value through our share buyback program. We have now cumulatively bought back stock worth $123 million and have $77 million remaining under our authorized share repurchase program.
We are continuing our efforts to increase the value of the company while remaining vigilant about geopolitical risks to ensure the long-term prosperity of Danaos for the benefit of our shareholders."
Three months ended September 30, 2024 compared to the three months ended September 30, 2023
During the three months ended September 30, 2024, Danaos had an average of 71.1 container vessels and 9.9 Capesize drybulk vessels compared to 68.0 container vessels and no drybulk vessels during the three months ended September 30, 2023. Our container vessels utilization remained stable at 97.7% in each of the three months ended September 30, 2024 and September 30, 2023.
Our adjusted net income amounted to $126.8 million, or $6.50 per diluted share, for the three months ended September 30, 2024 compared to $143.0 million, or $7.26 per diluted share, for the three months ended September 30, 2023. We have adjusted our net income in the three months ended September 30, 2024 for a $2.8 million change in fair value of investments, a $0.6 million non-cash finance fees amortization and a $0.4 million loss on vessel disposal.
Adjusted net income of our container vessels segment amounted to $125.1 million for the three months ended September 30, 2024 compared to $142.6 million for the three months ended September 30, 2023. We adjusted net income of container vessels segment in the three months ended September 30, 2024 for a $0.6 million non-cash finance fees amortization and a $0.4 million loss on vessel disposal.
Adjusted net income of our drybulk vessels segment amounted to $0.1 million for the three months ended September 30, 2024 compared to $0.1 million adjusted net loss for the three months ended September 30, 2023.
The $16.2 million decrease in adjusted net income for the three months ended September 30, 2024 compared to the three months ended September 30, 2023 is primarily attributable to a $31.1 million increase in total operating expenses, a $3.3 million increase in net finance expenses and a $0.7 million increase in equity loss on investments, which were partially offset by a $17.0 million increase in operating revenues and a $1.9 million increase in dividends received.
Please refer to the Adjusted Net Income reconciliation tables, which appear later in this earnings release.
On a non-adjusted basis, our net income amounted to $123.0 million, or $6.30 earnings per diluted share, for the three months ended September 30, 2024 compared to net income of $133.2 million, or $6.76 earnings per diluted share, for the three months ended September 30, 2023. On a non-adjusted basis, the net income of our container vessels segment amounted to $124.1 million and the net income of our drybulk vessels segment amounted to $0.1 million for the three months ended September 30, 2024.
Operating Revenues
Operating revenues increased by 7.1%, or $17.0 million, to $256.2 million in the three months ended September 30, 2024 from $239.2 million in the three months ended September 30, 2023.
Operating revenues of our container vessels segment decreased by 1.5%, or $3.6 million, to $235.6 million in the three months ended September 30, 2024 from $239.2 million in the three months ended September 30, 2023, analyzed as follows:
-- a $14.0 million increase in revenues in the three months ended September
30, 2024 compared to the three months ended September 30, 2023 as a
result of vessel additions;
-- a $7.1 million increase in revenues in the three months ended September
30, 2024 compared to the three months ended September 30, 2023 due to
higher non-cash revenue recognition in accordance with US GAAP;
-- a $17.9 million decrease in revenues in the three months ended September
30, 2024 compared to the three months ended September 30, 2023 as a
result of lower charter rates;
-- a $2.4 million decrease in revenues in the three months ended September
30, 2024 compared to the three months ended September 30, 2023 due to
vessel disposals; and
-- a $4.4 million decrease in revenues in the three months ended September
30, 2024 compared to the three months ended September 30, 2023 due to
decreased amortization of assumed time charters.
Operating revenues of our drybulk vessels segment added an incremental $20.6 million of revenues in the three months ended September 30, 2024 compared to no such operating revenues in the three months ended September 30, 2023.
Vessel Operating Expenses
Vessel operating expenses increased by $10.4 million to $49.9 million in the three months ended September 30, 2024 from $39.5 million in the three months ended September 30, 2023, primarily as a result of the increase in the average number of vessels in our fleet due to recent container vessel newbuilds deliveries and drybulk vessels acquisitions and the increase in average daily operating cost of our vessels to $6,860 per vessel per day for the three months ended September 30, 2024 compared to $6,499 per vessel per day for the three months ended September 30, 2023. Management believes that our daily operating costs remain among 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 increased by 19.8%, or $6.4 million, to $38.7 million in the three months ended September 30, 2024 from $32.3 million in the three months ended September 30, 2023 mainly due to depreciation expense related to 10 recently acquired Capesize drybulk vessels and 5 recently delivered container newbuilds.
Amortization of Deferred Dry-docking and Special Survey Costs
Amortization of deferred dry-docking and special survey costs increased by $2.7 million to $7.5 million in the three months ended September 30, 2024 from $4.8 million in the three months ended September 30, 2023.
General and Administrative Expenses
General and administrative expenses increased by $3.9 million, to $11.0 million in the three months ended September 30, 2024 from $7.1 million in the three months ended September 30, 2023. The increase was mainly attributable to increased stock-based compensation and management fees.
Other Operating Expenses
Other Operating Expenses include Voyage Expenses.
Voyage Expenses
Voyage expenses increased by $8.0 million to $17.0 million in the three months ended September 30, 2024 from $9.0 million in the three months ended September 30, 2023 primarily as a result of the $9.2 million in voyage expenses related to our recently acquired 10 Capesize drybulk vessels, which generated revenue partially from voyage charter agreements, compared to no such expenses related to drybulk vessels in the three months ended September 30, 2023.
Voyage expenses of container vessels segment decreased by $1.2 million to $7.8 million in the three months ended September 30, 2024 from $9.0 million in the three months ended September 30, 2023.
Voyage expenses of drybulk vessels segment were $9.2 million in the three months ended September 30, 2024 compared to no voyage expenses in the three months ended September 30, 2023. Total voyage expenses of drybulk vessels comprised $1.2 million commissions and $8.0 million other voyage expenses, mainly bunkers consumption and port expenses, in the three months ended September 30, 2024.
Net gain on disposal/sale of vessels
In March 2024, we sold for scrap the vessel Stride, which had been off-hire since January 8, 2024 due to damage from a fire in the engine room that was subsequently contained. We collected $9.9 million net insurance proceeds for total loss of vessel and recognized a gain on disposal of this vessel amounting to $7.1 million in the six months ended June 30, 2024. In the three months ended September 30, 2024, we recognized $0.4 million of expenses related to this vessel disposal, which reduced the total gain to $6.7 million in the nine months ended September 30, 2024. The proceedings with the insurers are in progress as of September 30, 2024, and any additional gain will be recognized upon their finalization.
Interest Expense and Interest Income
Interest expense increased by $3.7 million, to $8.0 million in the three months ended September 30, 2024 from $4.3 million in the three months ended September 30, 2023. The increase in interest expense is a result of:
-- a $4.2 million increase in interest expense due to an increase in our
average indebtedness by $224.7 million between the two periods, which
was partially offset by a decrease in our debt service cost by
approximately 0.26%, mainly as a result of a reduction in the financing
margin cost. Average indebtedness was $646.8 million in the three months
ended September 30, 2024, compared to average indebtedness of $422.1
million in the three months ended September 30, 2023;
-- a $0.1 million increase in the amortization of deferred finance costs;
which were partially offset by
-- a $0.6 million decrease in interest expense due to an increase in
capitalized interest expense on our vessels under construction in the
three months ended September 30, 2024.
As of September 30, 2024, our outstanding debt, gross of deferred finance costs, was $689.5 million, which included $262.8 million principal amount of our Senior Notes. These balances compare to debt of $417.4 million, which included $262.8 million principal amount of our Senior Notes as of September 30, 2023. The increase in our outstanding debt is mainly due to loans drawn down to partially finance our container vessel newbuildings.
Interest income remained stable at $3.1 million in each of the three months ended September 30, 2024 and September 30, 2023.
Gain/(loss) on investments
Following the all-stock merger of Eagle Bulk Shipping Inc. with Star Bulk Carriers Corp. ("SBLK") completed on April 9, 2024, we currently own 4,070,214 shares of common stock of SBLK. The $41 thousand gain on investments in the three months ended September 30, 2024 consisted of the $2.8 million fair value loss on these marketable securities, which was offset by the dividends recognized on these shares of $2.8 million. This compares to a $8.4 million loss on marketable securities in the three months ended September 30, 2023.
Equity loss on investments
Equity loss on investments amounting to $1.2 million and $0.5 million in the three months September 30, 2024 and September 30, 2023, respectively, relates to our share of initial expenses of Carbon Termination Technologies Corporation ("CTTC"), currently engaged in the research and development of decarbonization technologies for the shipping industry.
Other finance expenses
Other finance expenses decreased by $0.3 million to $0.9 million in the three months ended September 30, 2024 compared to $1.2 million in the three months ended September 30, 2023.
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 September 30, 2024 and September 30, 2023.
Other income/(expenses), net
Other expenses, net amounted to $0.7 million in the three months ended September 30, 2024 compared to $1.1 million other income, net in the three months ended September 30, 2023.
Adjusted EBITDA
Adjusted EBITDA increased by 0.5%, or $0.9 million, to $178.9 million in the three months ended September 30, 2024 from $178.0 million in the three months ended September 30, 2023. As outlined above, the increase is mainly attributable to $21.4 million increase in operating revenues and a $1.9 million increase in dividends received, which were partially offset by a $21.7 million increase in total operating expenses and a $0.7 million increase in equity loss on investments. Adjusted EBITDA for the three months ended September 30, 2024 is adjusted for a $2.8 million change in fair value of investments and a $0.4 million loss on disposal of vessel. Tables reconciling Adjusted EBITDA to Net Income can be found at the end of this earnings release.
Adjusted EBITDA of container vessels segment decreased by 2.4%, or $4.2 million, to $173.5 million in the three months ended September 30, 2024 from $177.7 million in the three months ended September 30, 2023.
Adjusted EBITDA of drybulk vessels segment was $3.8 million in the three months ended September 30, 2024. We had just started to be engaged in the drybulk vessels segment and did not have significant expenses in the three months ended September 30, 2023.
Nine months ended September 30, 2024 compared to the nine months ended September 30, 2023
During the nine months ended September 30, 2024, Danaos had an average of 69.3 container vessels and 8.2 Capesize drybulk vessels compared to 68.1 container vessels and no drybulk vessels during the nine months ended September 30, 2023. Our container vessels utilization for the nine months ended September 30, 2024 was 97.4% compared to 97.8% for the nine months ended September 30, 2023.
Our adjusted net income amounted to $399.2 million, or $20.43 per diluted share, for the nine months ended September 30, 2024 compared to $431.6 million, or $21.54 per diluted share, for the nine months ended September 30, 2023. We have adjusted our net income in the nine months ended September 30, 2024 for a $10.4 million change in fair value of investments, a $6.7 million gain on vessel disposal and a $1.6 million non-cash finance fees amortization.
Adjusted net income of our container vessels segment amounted to $391.1 million for the nine months ended September 30, 2024 compared to $434.6 million for the nine months ended September 30, 2023. We adjusted net income of container vessels segment in the nine months ended September 30, 2024 for a $6.7 million gain on vessel disposal and a $1.6 million non-cash finance fees amortization.
Adjusted net income of our drybulk vessels segment amounted to $2.7 million for the nine months ended September 30, 2024 compared to $0.1 million adjusted net loss for the nine months ended September 30, 2023, as we just started to be engaged in the drybulk vessels segment during that period.
The $32.4 million decrease in adjusted net income for the nine months ended September 30, 2024 compared to the nine months ended September 30, 2023 is primarily attributable to a $73.1 million increase in total operating expenses, which was partially offset by a $31.7 million increase in operating revenues, a $5.9 million increase in dividends received, a $0.7 million decrease in net finance expenses and a $2.4 million decrease in equity loss on investments.
Please refer to the Adjusted Net Income reconciliation tables, which appear later in this earnings release.
On a non-adjusted basis, our net income amounted to $414.6 million, or $21.22 earnings per diluted share, for the nine months ended September 30, 2024 compared to net income of $426.4 million, or $21.28 earnings per diluted share, for the nine months ended September 30, 2023. On a non-adjusted basis, the net income of our container vessels segment amounted to $396.2 million and the net income of our drybulk vessels segment amounted to $2.7 million for the nine months ended September 30, 2024.
Operating Revenues
Operating revenues increased by 4.4%, or $31.6 million, to $755.9 million in the nine months ended September 30, 2024 from $724.3 million in the nine months ended September 30, 2023.
Operating revenues of our container vessels segment decreased by 3.4%, or $24.7 million, to $699.6 million in the nine months ended September 30, 2024 from $724.3 million in the nine months ended September 30, 2023, analyzed as follows:
-- a $18.9 million increase in revenues in the nine months ended September
30, 2024 compared to the nine months ended September 30, 2023 as a
result of vessel additions;
-- a $20.5 million decrease in revenues in the nine months ended September
30, 2024 compared to the nine months ended September 30, 2023 mainly as
a result of lower charter rates and decreased vessel utilization;
-- a $7.5 million decrease in revenues in the nine months ended September
30, 2024 compared to the nine months ended September 30, 2023 due to
vessel disposals;
-- a $12.3 million decrease in revenues in the nine months ended September
30, 2024 compared to the nine months ended September 30, 2023 due to
decreased amortization of assumed time charters; and
-- a $3.3 million decrease in revenues in the nine months ended September
30, 2024 compared to the nine months ended September 30, 2023 due to
lower non-cash revenue recognition in accordance with US GAAP.
Operating revenues of our drybulk vessels segment added an incremental $56.3 million of revenues in the nine months ended September 30, 2024 compared to no such operating revenues in the nine months ended September 30, 2023.
Vessel Operating Expenses
Vessel operating expenses increased by $18.1 million to $140.1 million in the nine months ended September 30, 2024 from $122.0 million in the nine months ended September 30, 2023, primarily as a result of the increase in the average number of vessels in our fleet due to recent container vessel newbuilds and dry bulk vessels acquisitions, while the average daily operating cost of our vessels remained stable at $6,775 per vessel per day for the nine months ended September 30, 2024 compared to $6,758 per vessel per day for the nine months ended September 30, 2023. Management believes that our daily operating costs remain among 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 increased by 12.7%, or $12.2 million, to $108.0 million in the nine months ended September 30, 2024 from $95.8 million in the nine months ended September 30, 2023 mainly due to depreciation expense related to 10 recently acquired Capesize drybulk vessels and 5 recently delivered container vessel newbuilds.
Amortization of Deferred Dry-docking and Special Survey Costs
Amortization of deferred dry-docking and special survey costs increased by $6.8 million to $19.9 million in the nine months ended September 30, 2024 from $13.1 million in the nine months ended September 30, 2023.
General and Administrative Expenses
General and administrative expenses increased by $11.4 million, to $32.5 million in the nine months ended September 30, 2024 from $21.1 million in the nine months ended September 30, 2023. The increase was mainly attributable to increased stock-based compensation and management fees.
Other Operating Expenses
Other Operating Expenses include Voyage Expenses.
Voyage Expenses
Voyage expenses increased by $24.8 million to $50.0 million in the nine months ended September 30, 2024 from $25.2 million in the nine months ended September 30, 2023 primarily as a result of the $25.5 million in voyage expenses related to our recently acquired 10 Capesize drybulk vessels, which generated revenue partially from voyage charter agreements, compared to no such expenses related to drybulk vessels in the nine months ended September 30, 2023.
Voyage expenses of container vessels segment decreased by $0.7 million to $24.5 million in the nine months ended September 30, 2024 from $25.2 million in the nine months ended September 30, 2023 mainly due to decreased other voyage expenses. Total voyage expenses of container vessels comprised $24.3 million commissions and $0.2 million other voyage expenses in the nine months ended September 30, 2024.
Voyage expenses of drybulk vessels segment were $25.5 million in the nine months ended September 30, 2024 compared to no voyage expenses in the nine months ended September 30, 2023. Total voyage expenses of drybulk vessels comprised $3.4 million commissions and $22.1 million other voyage expenses, mainly bunkers consumption and port expenses, in the nine months ended September 30, 2024.
Net gain on disposal/sale of vessels
In March 2024, we sold for scrap the vessel Stride, which had been off-hire since January 8, 2024 due to damage from a fire in the engine room that was subsequently contained. We collected $9.9 million net insurance proceeds for total loss of vessel and recognized a gain on disposal of this vessel amounting to $7.1 million in the six months ended June 30, 2024. In the three months ended September 30, 2024, we recognized $0.4 million expenses related to this vessel disposal, which reduced the total gain to $6.7 million in the nine months ended September 30, 2024. The proceedings with the insurers are in progress as of September 30, 2024, and any additional gain will be recognized upon their finalization.
In January 2023, we completed the sale of the container vessel Amalia C for net proceeds of $4.9 million resulting in a gain of $1.6 million.
Interest Expense and Interest Income
Interest expense decreased by $0.7 million, to $16.2 million in the nine months ended September 30, 2024 from $16.9 million in the nine months ended September 30, 2023. The decrease in interest expense is a result of:
-- a $4.8 million decrease in interest expense due to an increase in
capitalized interest expense on our vessels under construction in the
nine months ended September 30, 2024; and
-- a $0.2 million decrease in the amortization of deferred finance costs;
which were partially offset by
-- a $4.3 million increase in interest expense due to an increase in our
debt service cost by approximately 0.15% as a result of higher SOFR
rates, partially offset by a reduction in our financing margin cost, and
by an increase in our average indebtedness by $61.7 million between the
two periods. Average indebtedness was $524.6 million in the nine months
ended September 30, 2024, compared to average indebtedness of $462.9
million in the nine months ended September 30, 2023.
As of September 30, 2024, our outstanding debt, gross of deferred finance costs, was $689.5 million, which included $262.8 million principal amount of our Senior Notes. These balances compare to debt of $417.4 million, which included $262.8 million principal amount of our Senior Notes as of September 30, 2023. The increase in our outstanding debt is mainly due to loans drawn down to partially finance our container vessel newbuildings.
Interest income decreased by $0.4 million to $9.0 million in the nine months ended September 30, 2024 compared to $9.4 million in the nine months ended September 30, 2023.
Gain/(loss) on investments
Following the all-stock merger of Eagle Bulk Shipping Inc. with Star Bulk Carriers Corp. ("SBLK") completed on April 9, 2024, we currently own 4,070,214 shares of common stock of SBLK. The gain on investments of $17.2 million in the nine months ended September 30, 2024 consisted of the change in fair value of these marketable securities of $10.4 million and dividends recognized on these shares of $6.8 million. This compares to a $2.0 million loss on marketable securities in the nine months ended September 30, 2023.
Loss on debt extinguishment
A $2.3 million loss on early extinguishment of our leaseback obligations in the nine months ended September 30, 2023 compares to no such loss in the nine months ended September 30, 2024.
Equity loss on investments
Equity loss on investments amounting to $1.4 million and $3.9 million in the nine months September 30, 2024 and September 30, 2023, respectively, relates to our share of initial expenses of CTTC, currently engaged in the research and development of decarbonization technologies for the shipping industry.
Other finance expenses
Other finance expenses decreased by $0.7 million to $2.7 million in the nine months ended September 30, 2024 compared to $3.4 million in the nine months ended September 30, 2023.
Loss on derivatives
Amortization of deferred realized losses on interest rate swaps remained stable at $2.7 million in each of the nine months ended September 30, 2024 and September 30, 2023.
Other income/(expenses), net
Other expenses, net amounted to $0.6 million in each of the nine months ended September 30, 2024 and September 30, 2023.
Adjusted EBITDA
Adjusted EBITDA decreased by 0.3%, or $1.5 million, to $532.9 million in the nine months ended September 30, 2024 from $534.4 million in the nine months ended September 30, 2023. As outlined above, the decrease is mainly attributable to a $53.7 million increase in total operating expenses, which were partially offset by a $43.9 million increase in operating revenues, a $5.9 million increase in dividends received and a $2.4 million decrease in equity loss on investments. Adjusted EBITDA for the nine months ended September 30, 2024 is adjusted for a $10.4 million change in fair value of investments and a $6.7 million net gain on disposal of vessel. Tables reconciling Adjusted EBITDA to Net Income can be found at the end of this earnings release.
Adjusted EBITDA of container vessels segment decreased by 3.8%, or $20.6 million, to $516.8 million in the nine months ended September 30, 2024 from $537.4 million in the nine months ended September 30, 2023.
Adjusted EBITDA of drybulk vessels segment was $10.7 million in the nine months ended September 30, 2024. We had just started to be engaged in the drybulk vessels segment and did not have significant expenses in the nine months ended September 30, 2023.
Dividend Payment
Danaos has declared a dividend of $0.85 per share of common stock for the third quarter of 2024, which is payable on December 4, 2024 to stockholders of record as of November 25, 2024.
Recent Developments
In October 2024 and through November 7, 2024, we repurchased 210,422 shares of our common stock in the open market for $17.8 million.
In October 2024, we took delivery of our 6(th) newbuilding containership the Greenfield, which was deployed on a three-year time charter.
Conference Call and Webcast
On Wednesday, November 12, 2024 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 279 948 9 (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 November 19, 2024 by dialing 1 877 344 7529 (US Toll Free Dial In) or 1-412-317-0088 (Standard International Dial In) and using 8988845# as the access code.
Audio Webcast
There will also be a live and then archived webcast of the conference call on 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.
Slide Presentation
A slide presentation regarding the Company and the container and drybulk industry will also be available on the Danaos website (www.danaos.com).
About Danaos Corporation
Danaos Corporation is one of the largest independent owners of modern, large-size container vessels. Our current fleet of 73 container vessels aggregating 465,463 TEUs and 14 under construction container vessels aggregating 115,834 TEUs ranks Danaos among the largest container vessels charter owners in the world based on total TEU capacity. Danaos has also recently invested in the drybulk sector with the acquisition of 10 capesize drybulk vessels aggregating 1,760,861 DWT. Our container vessels 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 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 drydocking, changes in Danaos Corporation's operating expenses, including bunker prices, drydocking and insurance costs, our ability to operate profitably in the drybulk sector, performance of shipyards constructing our contracted newbuilding vessels, 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, including the conflict in Ukraine and related sanctions, the conflict in Israel and the Gaza Strip, potential disruption of shipping routes such as Houthi attacks in the Red Sea and the Gulf of Aden, 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
Container vessels fleet utilization
---
Vessel Utilization (No. of Days) Three months ended Three months ended Nine months ended Nine months ended
September 30, September 30, September 30, September 30,
2024 2023 2024 2023
Ownership Days 6,540 6,256 18,978 18,594
Less Off-hire Days:
Scheduled Off-hire Days (127) (119) (289) (349)
Other Off-hire Days (26) (22) (195) (68)
Operating Days(1) 6,387 6,115 18,494 18,177
Vessel Utilization 97.7 % 97.7 % 97.4 % 97.8 %
Operating Revenues (in '000s of US$) $235,570 $239,215 $699,567 $724,268
Less: Voyage Expenses excluding commissions (in '000s of US$) 757 (479) (179) (1,225)
Time Charter Equivalent Revenues (in '000s of US$) 236,327 238,736 699,388 723,043
Time Charter Equivalent US$/per day(2) $37,001 $39,041 $37,817 $39,778
Drybulk vessels fleet utilization
---
Vessel Utilization (No. of Days) Three months ended Three months ended Nine months ended Nine months ended
September 30, September 30, September 30, September 30,
2024 2023 2024 2023
Ownership Days 913 5 2,244 5
Less Off-hire Days:
Scheduled Off-hire Days (119) (5) (240) (5)
Other Off-hire Days (16) (26)
Operating Days(1) 778 1,978
Vessel Utilization 85.2 % 88.1 %
Operating Revenues (in '000s of US$) $20,606 $56,364
Less: Voyage Expenses excluding commissions (in '000s of US$) (8,019) (22,115)
Time Charter Equivalent Revenues (in '000s of US$) 12,587 34,249
Time Charter Equivalent US$/per day(2) $16,179 $17,315
1) We define Operating Days as the total number of Ownership Days net of Scheduled off-hire days (days associated with scheduled repairs,
drydockings or special or intermediate surveys or days) and net of off-hire days associated with unscheduled repairs or days waiting to
find employment but including days our vessels were sailing for repositioning. The shipping industry uses Operating Days to measure the
number of days in a period during which vessels actually generate revenues or are sailing for repositioning purposes. Our definition of
Operating Days may not be comparable to that used by other companies in the shipping industry.
2) Time charter equivalent US$/per day ("TCE rate") represents the average daily TCE rate of our container vessels segment and drybulk
vessels segment calculated dividing time charter equivalent revenues of each segment by operating days of each segment. TCE rate is a
standard shipping industry performance measure used primarily to compare period to period changes in a shipping company's performance
despite changes in the mix of charter types i.e., voyage charters, time charters, bareboat charters under which its vessels may be
employed between the periods. Our method of computing TCE rate may not necessarily be comparable to TCE rates of other companies due to
differences in methods of calculation. We include TCE rate, a non- GAAP measure, as it provides additional meaningful information in
conjunction with operating revenues, the most directly comparable GAAP measure, and it assists our management in making decisions
regarding the deployment and use of our operating vessels and assists investors and our management in evaluating our financial
performance.
Fleet List
The following table describes in detail our container vessels deployment profile as of November 7, 2024:
Vessel Name Vessel Year Expiration of
Size Built Charter(2)
(TEU) (1)
Ambition (ex Hyundai Ambition) 13,100 2012 April 2027
Speed (ex Hyundai Speed) 13,100 2012 March 2027
Kota Plumbago (ex Hyundai Smart) 13,100 2012
July 2027
Kota Primrose (ex Hyundai Respect) 13,100 2012 April 2027
Kota Peony (ex Hyundai Honour) 13,100 2012 March 2027
Express Rome 10,100 2011
May 2027
Express Berlin 10,100 2011 August 2026
Express Athens 10,100 2011
May 2027
Le Havre 9,580 2006
June 2028
Pusan C 9,580 2006
May 2028
Bremen 9,012 2009 January 2028
C Hamburg 9,012 2009 January 2028
Niledutch Lion 8,626 2008
May 2026
Kota Manzanillo 8,533 2005 February 2026
Belita 8,533 2006
July 2026
CMA CGM Melisande 8,530 2012 January 2028
CMA CGM Attila 8,530 2011
May 2027
CMA CGM Tancredi 8,530 2011
July 2027
CMA CGM Bianca 8,530 2011 September 2027
CMA CGM Samson 8,530 2011 November 2027
America 8,468 2004 April 2028
Europe 8,468 2004
May 2028
Kota Santos 8,463 2005 August 2026
Catherine C
(3) 8,010 2024
May 2027
Greenland
(3) 8,010 2024
June 2027
Greenville
(
4
) 8,010 2024 August 2027
Greenfield
(
5
) 8,010 2024 October 2027
Interasia Accelerat
e
(3) 7,165 2024 April 2027
Interasia Amplify
(
4
) 7,165 2024 September 2027
CMA CGM Moliere 6,500 2009 March 2027
CMA CGM Musset 6,500 2010 September 2025
CMA CGM Nerval 6,500 2010 November 2025
CMA CGM Rabelais 6,500 2010 January 2026
Racine 6,500 2010 April 2026
YM Mandate 6,500 2010 January 2028
YM Maturity 6,500 2010 April 2028
Savannah (ex
Zim Savannah
) 6,402 2002
June 2027
Dimitra C 6,402 2002 April 2027
Suez Canal 5,610 2002 April 2026
Kota Lima 5,544 2002 September 2025
Wide Alpha 5,466 2014
July 2027
Stephanie C 5,466 2014
May 2028
Euphrates (ex
Maersk Euphrates
) 5,466 2014 September 2028
Wide Hotel 5,466 2015 September 2027
Wide India 5,466 2015 October 2028
Wide Juliet 5,466 2015 September 2025
Seattle C 4,253 2007 October 2026
Vancouver 4,253 2007 November 2026
Derby D 4,253 2004 January 2027
Tongala 4,253 2004 December 2026
Rio Grande 4,253 2008 November 2026
Merve A 4,253 2008 September 2025
Kingston 4,253 2008
June 2027
Monaco (ex ZIM Monaco) 4,253 2009 September 2026
Dalian 4,253 2009 March 2026
ZIM Luanda 4,253 2009 August 2025
Dimitris C 3,430 2001 September 2027
Express Black Sea 3,400 2011 January 2027
Express Spain 3,400 2011 January 2027
Express Argentina 3,400 2010 December 2026
Express Brazil 3,400 2010 April 2027
Express France 3,400 2010
July 2027
Singapore 3,314 2004 March 2027
Colombo 3,314 2004 January 2027
Zebra 2,602 2001 November 2025
Artotina 2,524 2001 January 2026
Advance 2,200 1997
June 2026
Future 2,200 1997
May 2026
Sprinter 2,200 1997
May 2026
Bridge 2,200 1998 December 2024
Progress C 2,200 1998 April 2026
Phoenix D 2,200 1997 March 2025
Highway 2,200 1998 February 2025
(1) Twenty-feet equivalent unit, the international standard measure for containers and
container vessels capacity.
(2) Earliest date charters could expire. Some charters include options for the charterer to
extend their terms.
(3)
The newbuilding vessels were delivered in the second quarter of 2024.
(4)
The newbuilding vessels were delivered in the third quarter of 2024.
(5)
The newbuilding vessel was delivered in October 2024.
Container vessels under construction as of November 7, 2024:
Hull Number Vessel Expected Delivery Minimum Charter
Size Year Duration
(TEU)
Hull No. CV5900-07 6,014 2025
2 Years
Hull No. CV5900-08 6,014 2025
2 Years
Hull No. YZJ2023-1556 8,258 2026
5 Years
Hull No. YZJ2023-1557 8,258 2026
5 Years
Hull No. YZJ2024-1612 8,258 2026
5 Years
Hull No. YZJ2024-1613 8,258 2027
5 Years
Hull No. YZJ2024-1625 8,258 2027
5 Years
Hull No. YZJ2024-1626 8,258 2027
5 Years
Hull No. YZJ2024-1668 8,258 2027
5 Years
Hull No. C9200-7 9,200 2027
4.8 Years
Hull No. C9200-8 9,200 2027
4.8 Years
Hull No. C9200-9 9,200 2027
4.8 Years
Hull No. C9200-10 9,200 2028
4.8 Years
Hull No. C9200-11 9,200 2028
4.8 Years
The following table describes the details of our Capesize drybulk vessels as of November 7, 2024:
Vessel Name Capacity Year Built
(DWT) (1)
Achievement 175,966 2011
Genius 175,580 2012
Ingenuity 176,022 2011
Integrity 175,966 2010
Peace 175,858 2010
W Trader 175,879 2009
E Trader 175,886 2009
Gouverneur (ex Xin Hang)
(2) 178,043 2010
Valentine (ex Star Audrey)
(2) 175,125 2011
Danaos (ex Guo May)
(3) 176,536 2011
(1) DWT, dead weight tons, the international standard measure for drybulk
vessels capacity.
(2)
The vessels were delivered in the second quarter of 2024.
(3)
The vessel was delivered in July 2024.
DANAOS CORPORATION
Condensed Consolidated Statements of Income - Unaudited
(Expressed in thousands of United States dollars, except per share amounts)
Three months Three months Nine months Nine months
ended ended ended ended
September 30, September 30, September 30, September 30,
2024 2023 2024 2023
OPERATING REVENUES $256,176 $239,215 $755,931 $724,268
OPERATING EXPENSES
Vessel operating expenses (49,866) (39,494) (140,070) (121,994)
Depreciation & amortization (46,211) (37,097) (127,878) (108,873)
General & administrative (10,978) (7,070) (32,519) (21,107)
Other operating expenses (16,999) (8,959) (50,019) (25,241)
Net gain/(loss) on disposal/sale of vessels (443) 6,651 1,639
Income From Operations 131,679 146,595 412,096 448,692
OTHER INCOME/(EXPENSES)
Interest income 3,124 3,091 8,983 9,410
Interest expense (8,013) (4,306) (16,243) (16,909)
Gain/(loss) on investments 41 (8,432) 17,228 (1,994)
Loss on debt extinguishment (2,254)
Other finance expenses (944) (1,236) (2,694) (3,358)
Equity loss on investments (1,232) (526) (1,438) (3,852)
Other income/(expenses), net (746) (1,117) (567) (648)
Realized loss on derivatives (913) (913) (2,719) (2,709)
Total Other Income/(Expenses), net (8,683) (13,439) 2,550 (22,314)
Net Income 122,996 133,156 414,646 426,378
EARNINGS PER SHARE
Basic earnings per share $6.36 $6.76 $21.41 $21.28
Diluted earnings per share $6.30 $6.76 $21.22 $21.28
Basic weighted average number of common shares (in thousands of shares) 19,345 19,693 19,368 20,039
Diluted weighted average number of common shares (in thousands of shares) 19,517 19,693 19,540 20,039
Reconciliation of Net Income to Adjusted Net Income - Unaudited
Three months Three months Nine months Nine months
ended ended ended ended
September 30, September 30, September 30, September 30,
2024 2023 2024 2023
Net Income $122,996 $133,156 $414,646 $426,378
Change in fair value of investments 2,808 9,333 (10,395) 2,895
Loss on debt extinguishment - 2,254
Net (gain)/loss on disposal/sale of vessels 445 (6,649) (1,639)
Amortization of financing fees 598 474 1,569 1,735
Adjusted Net Income $126,845 $142,963 $399,169 $431,623
Adjusted Earnings Per Share, diluted $6.50 $7.26 $20.43 $21.54
Diluted weighted average number of shares (in thousands of shares) 19,517 19,693 19,540 20,039
1) 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 and nine months ended
September 30, 2024 and 2023. The 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. The non-GAAP financial measures as presented above may not be comparable to
similarly titled measures of other companies in the shipping or other industries.
DANAOS CORPORATION
Condensed Consolidated Balance Sheets - Unaudited
(Expressed in thousands of United States dollars)
As of As of
September 30, December 31,
2024 2023
ASSETS
CURRENT ASSETS
Cash, cash equivalents and restricted cash $384,336 $271,809
Accounts receivable, net 24,647 9,931
Other current assets 221,002 220,030
629,985 501,770
NON-CURRENT ASSETS
Fixed assets, net 3,215,293 2,746,541
Advances for vessels acquisition and
vessels under construction 299,458 301,916
Deferred charges, net 46,133 38,012
Other non-current assets 62,949 72,897
3,623,833 3,159,366
TOTAL ASSETS $4,253,818 $3,661,136
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Long-term debt, current portion $31,720 $21,300
Accounts payable, accrued liabilities &
other current liabilities 128,687 146,860
160,407 168,160
LONG-TERM LIABILITIES
Long-term debt, net 647,276 382,874
Other long-term liabilities 59,695 93,785
706,971 476,659
STOCKHOLDERS' EQUITY
Common stock 193 194
Additional paid-in capital 688,649 690,190
Accumulated other comprehensive loss (72,472) (75,979)
Retained earnings 2,770,070 2,401,912
3,386,440 3,016,317
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $4,253,818 $3,661,136
DANAOS CORPORATION
Condensed Consolidated Statements of Cash Flows - Unaudited
(Expressed in thousands of United States dollars)
Three months Three months Nine months Nine months
ended ended ended ended
September 30, September 30, September 30, September 30,
2024 2023 2024 2023
Operating Activities:
Net income $122,996 $133,156 $414,646 $426,378
Adjustments to reconcile net income to net cash provided by operating
activities:
Depreciation 38,726 32,325 107,969 95,764
Amortization of deferred drydocking & special survey
costs and finance costs 8,083 5,246 21,478 14,844
Amortization of assumed time charters - (4,416) (4,534) (16,806)
Prior service cost and periodic cost 1,133 220 1,848 1,106
(Gain)/loss on investments 2,808 9,333 (10,395) 2,895
Loss on debt extinguishment - 2,254
Net (gain)/loss on disposal/sale of vessels 443 (6,651) (1,639)
Payments for drydocking/special survey (14,072) (6,993) (28,690) (21,553)
Amortization of deferred realized losses on cash flow
interest rate swaps 913 913 2,719 2,709
Equity loss on investments 1,232 526 1,438 3,852
Stock based compensation 1,594 4,747
Accounts receivable 6,216 740 (6,579) (1,716)
Other assets, current and non-current 2,568 982 23,775 (11,424)
Accounts payable and accrued liabilities (6,728) (4,654) (961) (7,805)
Other liabilities, current and long-term (8,368) (17,872) (55,699) (58,747)
Net Cash provided by Operating Activities 157,544 149,506 465,111 430,112
Investing Activities:
Vessel additions and advances for vessels under
construction (239,353) (98,274) (581,208) (128,058)
Net proceeds and insurance proceeds from disposal/sale
of vessels (443) 10,196 3,914
Investments (1,225) (1,225) (74,407)
Net Cash used in Investing Activities (241,021) (98,274) (572,237) (198,551)
Financing Activities:
Proceeds from long-term debt 118,000 299,000
Debt repayment (6,290) (6,875) (20,040) (20,625)
Payments of leaseback obligations - (72,925)
Dividends paid (15,476) (14,802) (46,487) (45,163)
Repurchase of common stock (492) (16,596) (5,715) (52,334)
Finance costs (375) (7,105) (1,892)
Net Cash provided by/(used in) Financing Activities 95,367 (38,273) 219,653 (192,939)
Net increase in cash and cash equivalents 11,890 12,959 112,527 38,622
Cash and cash equivalents, beginning of period 372,446 293,331 271,809 267,668
Cash and cash equivalents, end of period $384,336 $306,290 $384,336 $306,290
DANAOS CORPORATION
Reconciliation of Net Income to Adjusted EBITDA - Unaudited
(Expressed in thousands of United States dollars)
Three Three Nine Nine
months months months months
ended ended ended ended
September September September September
30, 30, 30, 30,
2024 2023 2024 2023
Net income $122,996 $133,156 $414,646 $426,378
Depreciation 38,726 32,325 107,969 95,764
Amortization of deferred drydocking & special survey costs 7,485 4,772 19,909 13,109
Amortization of assumed time charters - (4,416) (4,534) (16,806)
Amortization of finance costs and commitment fees 1,235 1,203 3,534 3,965
Amortization of deferred realized losses on interest rate swaps 913 913 2,719 2,709
Interest income (3,124) (3,091) (8,983) (9,410)
Interest expense excluding amortization of finance costs 7,415 3,832 14,674 15,174
Change in fair value of investments 2,808 9,333 (10,395) 2,895
Loss on debt extinguishment - 2,254
Net (gain)/loss on disposal/sale of vessels 443 (6,651) (1,639)
Adjusted EBITDA(1) $178,897 $178,027 $532,888 $534,393
Last Last
twelve twelve
months months
ended ended
September December
30, 31,
2024 2023
Net income $564,567 $576,299
Depreciation 141,492 129,287
Amortization of deferred drydocking & special survey costs 25,463 18,663
Amortization of assumed time charters (8,950) (21,222)
Amortization of finance costs and commitment fees 4,705 5,136
Amortization of deferred realized losses on interest rate swaps 3,632 3,622
Interest income (11,706) (12,133)
Interest expense excluding amortization of finance costs 17,762 18,262
Change in fair value of investments (31,157) (17,867)
Stock based compensation 6,340 6,340
Loss on debt extinguishment - 2,254
Net gain on disposal/sale of vessels (6,651) (1,639)
Adjusted EBITDA(1) $705,497 $707,002
1) Adjusted EBITDA represents net income before interest income and expense, depreciation, amortization of deferred drydocking & special
survey costs, amortization of assumed time charters, amortization of deferred finance costs and commitment fees, amortization of deferred
realized losses on interest rate swaps, change in fair value of investments, stock based compensation, loss on debt extinguishment and
net gain on disposal/sale of vessels. 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 EBITDA
and Adjusted EBITDA assist investors and analysts in comparing our performance across reporting periods on a consistent basis by
excluding items that we do not believe are indicative of our core 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. The non-GAAP financial measures as presented above may not be comparable to similarly titled measures of other
companies in the shipping or other industries.
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 and nine months ended
September 30, 2024 and September 30, 2023; and the last twelve months ended September 30, 2024 and December 31, 2023. 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
Reconciliation of Net Income to Adjusted EBITDA per segment
Three Months Ended September 30, 2024 and Three Months Ended September 30, 2023
Unaudited
(Expressed in thousands of United States dollars)
Three Months Ended Three Months Ended
September 30, 2024 September 30, 2023
Container Drybulk Other Total Container Drybulk Other Total
Vessels Vessels Vessels Vessels
Net income/(loss) $124,102 $62 $(1,168) $122,996 $142,173 $(59) $(8,958) $133,156
Depreciation 35,520 3,206 38,726 32,315 10 32,325
Amortization of deferred drydocking & special survey costs 6,927 558 7,485 4,772 4,772
Amortization of assumed time charters (4,416) (4,416)
Amortization of finance costs and commitment fees 1,235 1,235 1,203 1,203
Amortization of deferred realized losses on interest rate swaps 913 913 913 913
Interest income (3,101) (23) (3,124) (3,091) (3,091)
Interest expense excluding amortization of finance costs 7,415 7,415 3,832 3,832
Change in fair value of investments 2,808 2,808 9,333 9,333
Net (gain)/loss on disposal/sale of vessels 443 443
Adjusted EBITDA(1) $173,454 $3,826 $1,617 $178,897 $177,701 $(49) $375 $178,027
1) Adjusted EBITDA represents net income before interest income and expense, depreciation, amortization of deferred drydocking & special
survey costs, amortization of assumed time charters, amortization of deferred finance costs and commitment fees, amortization of deferred
realized losses on interest rate swaps, change in fair value of investments and net gain on disposal/sale of vessels. 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 EBITDA and Adjusted EBITDA assist investors and analysts in comparing
our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core
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. The non-GAAP financial measures as presented above may
not be comparable to similarly titled measures of other companies in the shipping or other industries.
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 September
30, 2024 and 2023. 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
Reconciliation of Net Income to Adjusted EBITDA per segment
Nine Months Ended September 30, 2024 and Nine Months Ended September 30, 2023
Unaudited
(Expressed in thousands of United States dollars)
Nine Months Ended Nine Months Ended
September 30, 2024 September 30, 2023
Container Drybulk Other Total Container Drybulk Other Total
Vessels Vessels Vessels Vessels
Net income/(loss) $396,144 $2,689 $15,813 $414,646 $432,283 $(59) $(5,846) $426,378
Depreciation 100,775 7,194 107,969 95,754 10 95,764
Amortization of deferred drydocking & special survey costs 19,062 847 19,909 13,109 13,109
Amortization of assumed time charters (4,534) (4,534) (16,806) (16,806)
Amortization of finance costs and commitment fees 3,534 3,534 3,965 3,965
Amortization of deferred realized losses on interest rate swaps 2,719 2,719 2,709 2,709
Interest income (8,960) (23) (8,983) (9,410) (9,410)
Interest expense excluding amortization of finance costs 14,674 14,674 15,174 15,174
Change in fair value of investments (10,395) (10,395) 2,895 2,895
Loss on debt extinguishment 2,254 2,254
Net gain on disposal/sale of vessels (6,651) (6,651) (1,639) (1,639)
Adjusted EBITDA(1) $516,763 $10,730 $5,395 $532,888 $537,393 $(49) $(2,951) $534,393
1) Adjusted EBITDA represents net income before interest income and expense, depreciation, amortization of deferred drydocking & special
survey costs, amortization of assumed time charters, amortization of deferred finance costs and commitment fees, amortization of deferred
realized losses on interest rate swaps, change in fair value of investments and net gain on disposal/sale of vessels. 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 EBITDA and Adjusted EBITDA assist investors and analysts in comparing
our performance across reporting periods on a consistent basis by excluding items that we do not believe are indicative of our core
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. The non-GAAP financial measures as presented above may
not be comparable to similarly titled measures of other companies in the shipping or other industries.
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 nine months ended September
30, 2024 and 2023. 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
Reconciliation of Net Income to Adjusted Net Income per segment
Three Months Ended September 30, 2024 and Three Months Ended September 30, 2023
Unaudited
(Expressed in thousands of United States dollars)
Three Months Ended Three Months Ended
September 30, 2024 September 30, 2023
Container Drybulk Other Total Container Drybulk Other Total
Vessels Vessels Vessels Vessels
Net income/(loss) $124,102 $62 $(1,168) $122,996 $142,173 $(59) $(8,958) $133,156
Change in fair value of investments 2,808 2,808 9,333 9,333
Amortization of financing fees 598 598 474 474
Net loss on disposal/sale of vessels 443 443
Adjusted Net income/(loss)(1) $125,143 $62 $1,640 $126,845 $142,647 $(59) $375 $142,963
Adjusted Earnings per Share, diluted $6.50 $7.26
Diluted weighted average number of shares (in thousands of shares) 19,517 19,693
DANAOS CORPORATION
Reconciliation of Net Income to Adjusted Net Income per segment
Nine Months Ended September 30, 2024 and Nine Months Ended September 30, 2023
Unaudited
(Expressed in thousands of United States dollars)
Nine Months Ended Nine Months Ended
September 30, 2024 September 30, 2023
Container Drybulk Other Total Container Drybulk Other Total
Vessels Vessels Vessels Vessels
Net income/(loss) $396,144 $2,689 $15,813 $414,646 $432,283 $(59) $(5,846) $426,378
Change in fair value of investments (10,395) (10,395) 2,895 2,895
Loss on debt extinguishment 2,254 2,254
Amortization of financing fees 1,569 1,569 1,735 1,735
Net gain on disposal/sale of vessels (6,651) (6,651) (1,639) (1,639)
Adjusted Net income/(loss)(1) $391,062 $2,689 $5,418 $399,169 $434,633 $(59) $(2,951) $431,623
Adjusted Earnings per Share, diluted $20.43 $21,54
Diluted weighted average number of shares (in thousands of shares) 19,540 20,039
1) 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 and nine months ended
September 30, 2024 and 2023. 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. The non-GAAP financial measures as presented above may not be comparable to similarly
titled measures of other companies in the shipping or other industries.
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SOURCE Danaos Corporation
