Danaos Corporation Reports Results for the Fourth Quarter and Year Ended December 31, 2020
Danaos Corporation (NYSE: DAC) reported solid financial results for Q4 and the full year of 2020, showing a significant rise in adjusted net income to $47.8 million ($2.29 per share), up 25.8% year-over-year. Full-year adjusted net income rose to $170.9 million ($7.18 per share), a 14.9% increase. Operating revenues increased by 8.5% for Q4 and 3.2% for the full year, reaching $119.6 million and $461.6 million, respectively. The company also holds $1.2 billion in contracted operating revenues with strong charter coverage. CEO John Coustas highlighted improvements in the charter market and future revenue expectations exceeding $100 million above 2020 figures.
- Adjusted net income increased by 25.8% to $47.8 million in Q4 2020.
- Full-year adjusted net income rose 14.9% to $170.9 million.
- Operating revenues for Q4 grew by 8.5% to $119.6 million.
- Total contracted operating revenues reached $1.2 billion.
- Strong charter coverage of 94% for the next 12 months.
- Completed 27 recharterings at rates 2-3 times higher than prior contracts.
- Fleet utilization decreased to 96.3% for the year from 98.3% in 2019.
- Operating expenses increased, affecting profitability.
- Depreciation expense rose by 6.1% due to vessel acquisitions.
Danaos Corporation (“Danaos”) (NYSE: DAC), one of the world’s largest independent owners of containerships, today reported unaudited results for the fourth quarter and the year ended December 31, 2020.
Highlights for the Fourth Quarter and Year Ended December 31, 2020:
-
Adjusted net income1 of
$47.8 million , or$2.29 per share, for the three months ended December 31, 2020 compared to$38.0 million , or$2.01 per share, for the three months ended December 31, 2019, an increase of25.8% . Adjusted net income1 of$170.9 million , or$7.18 per share, for the year ended December 31, 2020 compared to$148.7 million , or$9.17 per share, for the year ended December 31, 2019, an increase of14.9% . -
Operating revenues of
$119.6 million for the three months ended December 31, 2020 compared to$110.2 million for the three months ended December 31, 2019, an increase of8.5% . Operating revenues of$461.6 million for the year ended December 31, 2020 compared to$447.2 million for the year ended December 31, 2019, an increase of3.2% . -
Adjusted EBITDA1 of
$83.0 million for the three months ended December 31, 2020 compared to$78.1 million for the three months ended December 31, 2019, an increase of6.3% . Adjusted EBITDA1 of$318.3 million for the year ended December 31, 2020 compared to$310.6 million for the year ended December 31, 2019, an increase of2.5% . -
Total contracted operating revenues were
$1.2 billion 2 as of December 31, 2020, with charters extending through 2028 and remaining average contracted charter duration of 3.1 years, weighted by aggregate contracted charter hire. -
Charter coverage of
94% for the next 12 months based on current operating revenues and91% in terms of contracted operating days.
Three Months and Year Ended December 31, 2020 |
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Financial Summary - Unaudited |
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(Expressed in thousands of United States dollars, except per share amounts) |
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Three months
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Three months
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Year ended |
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Year ended |
December 31, |
December 31, |
December 31, |
December 31, |
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2020 |
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2019 |
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2020 |
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2019 |
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Operating revenues |
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Net income |
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Adjusted net income1 |
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Earnings per share, diluted |
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Adjusted earnings per share, diluted1 |
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Diluted weighted average number of shares (in thousands) |
20,874 |
|
18,927 |
|
23,805 |
|
16,221 |
Adjusted EBITDA1 |
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1. Adjusted net income, adjusted earnings per share and adjusted EBITDA are non-GAAP measures. Please refer to the reconciliation of net income to adjusted net income and net income to adjusted EBITDA. |
2. Contracted revenue as of December 31, 2020 on the basis of concluded charter contracts through February 15, 2021. |
Danaos’ CEO Dr. John Coustas commented:
"In the fourth quarter of 2020, we witnessed the most outstanding turnaround in the container industry for as long as I can remember. Market participants were caught by surprise as the chronic underinvestment in capacity coupled with a sudden resurgence of demand created a spike that drove container box rates to all-time highs. This led to a massive increase in our customers’ profitability and significantly diminished the counterparty risk that was so prevalent at the end of the first quarter of 2020. The charter market, in turn, rapidly strengthened, resulting in decade-high charter rates across almost all vessel types.
Now everyone is focused on whether the current market strength is sustainable and for how long. Fortunately, incremental vessel supply will remain low for the time being. Although there have been new orders placed, the current orderbook is at historically low levels. Since there is a two-year lead time for new orders to hit the water, supply growth should be moderate for the next couple of years. What will happen next depends a lot on the environmental initiatives, regulations and of course demand.
As far as Danaos is concerned we experienced a strong quarter, completed delivery of all contracted vessels, realized significant gains, displayed exceptional rechartering performance and entered into agreements for a very important refinancing.
This quarter we saw an improvement in Adjusted EBITDA and Adjusted Net Income compared to the same quarter in the prior year. This improvement should be even more pronounced in the coming quarters as new contracted charters at significantly higher rates start to contribute to our top line.
We have concluded 27 recharterings over the past three months for periods of 12-24 months at rates between two and three times the rates of the expiring charters. In doing so, we have practically covered
The recent performance of both ZIM and HMM has resulted in a
We have also recently concluded a
We are happy that the market has acknowledged our accomplishments, leading to a dramatic outperformance of our share price as compared to our peers. We are well-positioned and committed to continue to take actions to create value for our shareholders."
Three months ended December 31, 2020 compared to the three months ended December 31, 2019
During the three months ended December 31, 2020, Danaos had an average of 58.5 containerships compared to 55.0 containerships during the three months ended December 31, 2019. Our fleet utilization for the three months ended December 31, 2020 was
Our adjusted net income amounted to
The increase of
On a non-adjusted basis, our net income amounted to
Operating Revenues
Operating revenues increased by
Operating revenues for the three months ended December 31, 2020 reflect:
-
a
$7.6 million increase in revenues in the three months ended December 31, 2020 compared to the three months ended December 31, 2019 mainly as a result of contractual increases in charter rates of vessels under long-term charters, partially offset by lower re-chartering rates between the two quarters for certain of our vessels; -
a
$6.1 million increase in revenues in the three months ended December 31, 2020 compared to the three months ended December 31, 2019 due to the acquisition of new vessels; -
a
$2.1 million increase in revenues due to higher fleet utilization of our vessels in the three months ended December 31, 2020 compared to the three months ended December 31, 2019. -
a
$6.4 million decrease in revenues in the three months ended December 31, 2020 compared to the three months ended December 31, 2019 due to lower non-cash revenue recognition in accordance with US GAAP; and
Vessel Operating Expenses
Vessel operating expenses increased by
Depreciation & Amortization
Depreciation & Amortization includes Depreciation and Amortization of Deferred Dry-docking and Special Survey Costs.
Depreciation
Depreciation expense increased by
Amortization of Deferred Dry-docking and Special Survey Costs
Amortization of deferred dry-docking and special survey costs increased by
General and Administrative Expenses
General and administrative expenses decreased by
Other Operating Expenses
Other Operating Expenses include Voyage Expenses.
Voyage Expenses
Voyage expenses increased by
Interest Expense and Interest Income
Interest expense decreased by
-
a
$6.0 million decrease in interest expense due to a decrease in debt service cost of approximately2% and a$92.6 million decrease in our average debt (including leaseback obligations), to$1,482.5 million in the three months ended December 31, 2020, compared to$1,575.1 million in the three months ended December 31, 2019; and -
a
$0.5 million increase in the amortization of deferred finance costs and debt discount related to our 2018 debt refinancing.
As of December 31, 2020, our outstanding bank debt, gross of deferred finance costs, was
Interest income remained stable at
Other finance costs, net
Other finance costs, net remained stable at
Equity income on investments
Equity income on investments increased by
Loss on derivatives
Amortization of deferred realized losses on interest rate swaps remained stable at
Other income, net
Other income, net was
Adjusted EBITDA
Adjusted EBITDA increased by
Year ended December 31, 2020 compared to the year ended December 31, 2019
During the year ended December 31, 2020, Danaos had an average of 57.3 containerships compared to 55.0 containerships during the year ended December 31, 2019. Our fleet utilization for the year ended December 31, 2020 was
Our adjusted net income amounted to
The increase of
On a non-adjusted basis, our net income amounted to
Operating Revenues
Operating revenues increased by
Operating revenues for the year ended December 31, 2020 reflect:
-
a
$24.5 million increase in revenues in the year ended December 31, 2020 compared to the year ended December 31, 2019 mainly as a result of contractual increases in charter rates of vessels under long-term charters, partially offset by lower re-chartering rates between the two quarters for certain of our vessels; -
a
$16.1 million increase in revenues in the year ended December 31, 2020 compared to the year ended December 31, 2019 due to the acquisition of new vessels; -
a
$22.2 million decrease in revenues in the year ended December 31, 2020 compared to the year ended December 31, 2019 due to lower non-cash revenue recognition in accordance with US GAAP; and -
a
$4.0 million decrease in revenues due to lower fleet utilization of our vessels in the year ended December 31, 2020 compared to the year ended December 31, 2019 mainly due to the scheduled installation of scrubbers and dry-dockings of our vessels, of which$3.2 million relates to incremental delays in the Chinese shipyards where these activities were being performed due to the COVID-19 pandemic.
Vessel Operating Expenses
Vessel operating expenses increased by
Depreciation & Amortization
Depreciation & Amortization includes Depreciation and Amortization of Deferred Dry-docking and Special Survey Costs.
Depreciation
Depreciation expense increased by
Amortization of Deferred Dry-docking and Special Survey Costs
Amortization of deferred dry-docking and special survey costs increased by
General and Administrative Expenses
General and administrative expenses decreased by
Other Operating Expenses
Other Operating Expenses include Voyage Expenses.
Voyage Expenses
Voyage expenses increased by
Interest Expense and Interest Income
Interest expense decreased by
As of December 31, 2020, our outstanding bank debt, gross of deferred finance costs, was
Interest income increased by
Other finance costs, net
Other finance costs, net decreased by
Equity income on investments
Equity income on investments increased by
Loss on derivatives
Amortization of deferred realized losses on interest rate swaps remained stable at
Other income, net
Other income, net was remained stable at
Adjusted EBITDA
Adjusted EBITDA increased by
Recent Developments
On February 4, 2021 we announced the pricing of our offering of
On January 27, 2021, ZIM completed its initial public offering and listing on the New York Stock Exchange of its ordinary shares. We currently own 10,186,950 ordinary shares of ZIM, which shareholding interest was valued at
On January 20, 2021 we received
On February 12, 2021, the Board and the Compensation Committee awarded 150,000 shares of common stock to officers and directors of the Company and employees of our Manager, Danaos Shipping Co. Ltd., under the auspices of the Company’s Equity Compensation Plan.
In December 2020 we took delivery of the two 9,012 TEU container vessels built in 2009 Bremen and C Hamburg.
Conference Call and Webcast
On Tuesday, February 16, 2021 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 February 23, 2021 by dialing 1 877 344 7529 (US Toll Free Dial In) or 1-412-317-0088 (Standard International Dial In) and using 10152390# 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 containership 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 containerships. Our current fleet of 65 containerships aggregating 403,793 TEUs, including five 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 impact of the COVID-19 pandemic and efforts throughout the world to contain its spread, including effects on global economic activity, demand for seaborne transportation of containerized cargo, the ability and willingness of charterers to perform their obligations to us, charter rates for containerships, shipyards performing scrubber installations, drydocking and repairs, changing vessel crews and availability of financing; the effects of the 2018 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 2018 refinancing; our ability to consummate our contemplated debt refinancing in 2021 and achieve the expected benefits of such debt 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 30 unscheduled off-hire days in the three months ended December 31, 2020. The following table summarizes vessel utilization and the impact of the off-hire days on the Company’s revenue.
Vessel Utilization (No.
|
First
|
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Second
|
|
Third
|
|
Fourth
|
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|
2020 |
2020 |
|
2020 |
|
2020 |
|
Total |
||
Ownership Days |
5,073 |
5,193 |
|
5,336 |
5,380 |
20,982 |
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Less Off-hire Days: |
|||||||||
Scheduled Off-hire Days |
(336) |
(60) |
(10) |
(81) |
(487) |
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Other Off-hire Days |
(104) |
(92) |
(60) |
(30) |
(286) |
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Operating Days |
4,633 |
5,041 |
5,266 |
5,269 |
20,209 |
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Vessel Utilization |
|
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Operating Revenues (in '000s of US Dollars) |
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Average Gross Daily Charter Rate |
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Vessel Utilization (No.
|
First
|
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Second
|
|
Third
|
|
Fourth
|
|
|
2019 |
2019 |
|
2019 |
|
2019 |
|
Total |
||
Ownership Days |
4,950 |
5,005 |
|
5,060 |
5,060 |
20,075 |
|||
Less Off-hire Days: |
|||||||||
Scheduled Off-hire Days |
- |
(22) |
(41) |
(123) |
(186) |
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Other Off-hire Days |
(90) |
(10) |
(24) |
(29) |
(153) |
||||
Operating Days |
4,860 |
4,973 |
4,995 |
4,908 |
19,736 |
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Vessel Utilization |
|
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Operating Revenues (in '000s of US Dollars) |
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Average Gross Daily Charter Rate |
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|
Fleet List
The following table describes in detail our fleet deployment profile as of February 15, 2021:
Vessel Name |
Vessel
|
|
Year Built |
|
Expiration of Charter(1) |
Hyundai Ambition (ex MSC Ambition) |
13,100 |
|
2012 |
|
June 2024 |
Hyundai Speed (ex Maersk Exeter) |
13,100 |
|
2012 |
|
June 2024 |
Hyundai Smart (ex 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 |
|
April 2023 |
Pusan C |
9,580 |
|
2006 |
|
March 2023 |
Bremen (ex CPO Bremen) |
9,012 |
|
2009 |
|
December 2022 |
C Hamburg (ex CPO Hamburg) |
9,012 |
|
2009 |
|
January 2023 |
Niledutch Lion |
8,626 |
|
2008 |
|
February 2022 |
Charleston (ex SM Charleston) |
8,533 |
|
2005 |
|
December 2021 |
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 |
|
February 2023 |
Europe |
8,468 |
|
2004 |
|
March 2023 |
Phoebe |
8,463 |
|
2005 |
|
April 2022 |
CMA CGM Moliere |
6,500 |
|
2009 |
|
February 2022 |
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 2021 |
Dimitra C |
6,402 |
|
2002 |
|
January 2023 |
Seattle C |
4,253 |
|
2007 |
|
September 2021 |
YM Vancouver |
4,253 |
|
2007 |
|
December 2021 |
Derby D |
4,253 |
|
2004 |
|
January 2022 |
ANL Tongala |
4,253 |
|
2004 |
|
March 2021 |
Rio Grande (ex ZIM Rio Grande) |
4,253 |
|
2008 |
|
December 2021 |
ZIM Sao Paolo |
4,253 |
|
2008 |
|
February 2023 |
ZIM Kingston |
4,253 |
|
2008 |
|
April 2023 |
ZIM Monaco |
4,253 |
|
2009 |
|
July 2022 |
ZIM Dalian |
4,253 |
|
2009 |
|
November 2022 |
ZIM Luanda |
4,253 |
|
2009 |
|
May 2021 |
Dimitris C |
3,430 |
|
2001 |
|
January 2022 |
Express Black Sea |
3,400 |
|
2011 |
|
January 2022 |
Express Spain |
3,400 |
|
2011 |
|
January 2022 |
Express Argentina |
3,400 |
|
2010 |
|
March 2021 |
Express Brazil |
3,400 |
|
2010 |
|
September 2021 |
Express France |
3,400 |
|
2010 |
|
October 2021 |
Singapore |
3,314 |
|
2004 |
|
October 2021 |
Colombo |
3,314 |
|
2004 |
|
December 2021 |
Zebra (ex MSC Zebra) |
2,602 |
|
2001 |
|
August 2021 |
Amalia C |
2,452 |
|
1998 |
|
May 2021 |
Danae C |
2,524 |
|
2001 |
|
February 2022 |
Advance |
2,200 |
|
1997 |
|
January 2022 |
Future |
2,200 |
|
1997 |
|
November 2021 |
Sprinter |
2,200 |
|
1997 |
|
December 2021 |
Stride |
2,200 |
|
1997 |
|
February 2022 |
Progress C |
2,200 |
|
1998 |
|
December 2021 |
Bridge |
2,200 |
|
1998 |
|
April 2022 |
Highway |
2,200 |
|
1998 |
|
March 2021 |
Vladivostok |
2,200 |
|
1997 |
|
October 2021 |
|
|
|
|
|
|
Belita ľ2) |
8,533 |
|
2006 |
|
September 2021 |
Catherine C (2) |
6,422 |
|
2001 |
|
January 2023 |
Leo C (2) |
6,422 |
|
2002 |
|
August 2022 |
Suez Canal(2) |
5,610 |
|
2002 |
|
March 2023 |
Genoaľ2) |
5,544 |
|
2002 |
|
September 2021 |
|
|
|
|
|
|
| (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 |
DANAOS CORPORATION |
||||||||
Condensed Consolidated Statements of Income - Unaudited |
||||||||
(Expressed in thousands of United States dollars, except per share amounts) |
||||||||
|
Three months
|
|
Three months
|
|
Year ended |
|
Year ended |
|
December 31, |
December 31, |
December 31, |
December 31, |
|||||
|
2020 |
|
2019 |
|
2020 |
|
2019 |
|
|
|
|
|
|
|
|
|
|
OPERATING REVENUES |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
OPERATING EXPENSES |
|
|
|
|
|
|
|
|
Vessel operating expenses |
(28,714) |
|
(24,467) |
|
(110,946) |
|
(102,502) |
|
Depreciation & amortization |
(28,534) |
|
(26,572) |
|
(112,563) |
|
(105,238) |
|
General & administrative |
(6,440) |
|
(7,054) |
|
(24,341) |
|
(26,837) |
|
Other operating expenses |
(3,377) |
|
(2,799) |
|
(14,264) |
|
(11,593) |
|
Income From Operations |
52,577 |
|
49,312 |
|
199,480 |
|
201,074 |
|
|
|
|
|
|
|
|
|
|
OTHER INCOME/(EXPENSES) |
|
|
|
|
|
|
|
|
Interest income |
1,686 |
|
1,663 |
|
6,638 |
|
6,414 |
|
Interest expense |
(11,637) |
(17,166) |
(53,502) |
(72,069) |
||||
Other finance expenses |
(345) |
(300) |
(2,335) |
(2,702) |
||||
Equity income on investments |
1,579 |
|
1,094 |
|
6,308 |
|
1,602 |
|
Other income/(loss), net |
232 |
|
127 |
|
593 |
|
556 |
|
Realized loss on derivatives |
(913) |
|
(913) |
|
(3,632) |
|
(3,622) |
|
Total Other Expenses, net |
(9,398) |
|
(15,495) |
|
(45,930) |
|
(69,821) |
|
|
|
|
|
|
|
|
|
|
Net Income |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EARNINGS PER SHARE |
|
|
|
|
|
|
|
|
Basic earnings per share |
|
|
|
|
|
|
|
|
Diluted earnings per share |
|
|
|
|
|
|
|
|
Basic weighted average number of common shares (in thousands of shares) |
20,658 |
|
18,494 |
23,589 |
|
15,835 |
||
Diluted weighted average number of common shares (in thousands of shares) |
20,874 |
|
18,927 |
23,805 |
|
16,221 |
||
Non-GAAP Measures1 |
|||||||
Reconciliation of Net Income to Adjusted Net Income – Unaudited |
|||||||
|
Three months
|
|
Three months
|
|
Year ended |
|
Year ended |
December 31, |
December 31, |
|
December 31, |
|
December 31, |
||
|
2020 |
|
2019 |
|
2020 |
|
2019 |
Net income |
|
|
|
|
|
||
Amortization of financing fees, debt discount & finance fees accrued |
4,631 |
|
4,152 |
17,338 |
17,422 |
||
Adjusted Net Income |
|
|
|
|
|
||
Adjusted Earnings Per Share, diluted |
|
|
|
|
|
||
Diluted weighted average number of shares (in thousands) |
20,874 |
|
18,927 |
23,805 |
16,221 |
||
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 months and year ended December 31, 2020 and 2019. 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 |
December 31, |
December 31, |
|||
|
|
2020 |
|
2019 |
ASSETS |
|
|
|
|
CURRENT ASSETS |
|
|
|
|
Cash and cash equivalents |
|
|
|
|
Accounts receivable, net |
|
7,556 |
|
7,145 |
Other current assets |
|
45,229 |
|
44,071 |
|
|
118,448 |
|
190,386 |
NON-CURRENT ASSETS |
|
|
|
|
Fixed assets, net |
|
2,479,937 |
|
2,389,874 |
Deferred charges, net |
|
17,339 |
|
11,455 |
Investments in affiliates |
|
15,273 |
|
8,965 |
Other non-current assets |
|
83,383 |
|
82,339 |
|
|
2,595,932 |
|
2,492,633 |
TOTAL ASSETS |
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
CURRENT LIABILITIES |
|
|
|
|
Long-term debt, current portion |
|
|
|
|
Accumulated accrued interest, current portion |
|
18,036 |
|
34,137 |
Long-term leaseback obligations, current portion |
|
24,515 |
|
16,342 |
Accounts payable, accrued liabilities & other current liabilities |
|
41,472 |
|
52,928 |
|
|
239,685 |
|
223,080 |
LONG-TERM LIABILITIES |
|
|
|
|
Long-term debt, net |
|
1,187,345 |
|
1,270,663 |
Accumulated accrued interest, net of current portion |
|
136,433 |
|
156,583 |
Long-term leaseback obligations, net |
|
95,585 |
|
121,872 |
Other long-term liabilities |
|
19,755 |
|
29,131 |
|
|
1,439,118 |
|
1,578,249 |
|
|
|
|
|
STOCKHOLDERS’ EQUITY |
|
|
|
|
Common stock |
|
204 |
|
248 |
Additional paid-in capital |
|
755,390 |
|
785,274 |
Accumulated other comprehensive loss |
|
(86,669) |
|
(116,934) |
Retained earnings |
|
366,652 |
|
213,102 |
|
|
1,035,577 |
|
881,690 |
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
DANAOS CORPORATION |
|||||||
Condensed Consolidated Statements of Cash Flows - Unaudited |
|||||||
(Expressed in thousands of United States dollars) |
|||||||
|
Three months
|
|
Three months
|
|
Year ended |
|
Year ended |
December 31, |
December 31, |
December 31, |
December 31, |
||||
|
2020 |
|
2019 |
|
2020 |
|
2019 |
Operating Activities: |
|
|
|
|
|
|
|
Net income |
|
|
|
|
|
|
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
|
|
Depreciation |
25,927 |
|
24,364 |
|
101,531 |
|
96,505 |
Amortization of deferred drydocking & special survey costs, finance cost, debt discount and other finance fees accrued |
7,238 |
|
6,360 |
|
28,900 |
|
26,155 |
PIK interest |
675 |
|
830 |
|
2,911 |
|
3,375 |
Payments for drydocking/special survey |
(3,519) |
|
(1,943) |
|
(16,916) |
|
(7,157) |
Amortization of deferred realized losses on cash flow interest rate swaps |
913 |
|
913 |
|
3,632 |
|
3,622 |
Equity income on investments |
(1,579) |
|
(1,094) |
|
(6,308) |
|
(1,602) |
Stock based compensation |
302 |
|
1,181 |
|
1,199 |
|
4,241 |
Accounts receivable |
3,290 |
|
492 |
|
(411) |
|
2,080 |
Other assets, current and non-current |
857 |
|
(5,754) |
|
3,199 |
|
(19,750) |
Accounts payable and accrued liabilities |
1,638 |
|
(2,618) |
|
2,252 |
|
(3,181) |
Other liabilities, current and long-term |
726 |
|
(4,315) |
|
(7,860) |
|
(15,663) |
Net Cash provided by Operating Activities |
79,647 |
|
52,233 |
|
265,679 |
|
219,878 |
|
|
|
|
|
|
|
|
Investing Activities: |
|
|
|
|
|
|
|
Vessel additions and advances |
(64,512) |
|
(6,598) |
|
(170,661) |
|
(21,360) |
Investments |
- |
|
- |
|
(75) |
|
- |
Net Cash used in Investing Activities |
(64,512) |
|
(6,598) |
|
(170,736) |
|
(21,360) |
|
|
|
|
|
|
|
|
Financing Activities: |
|
|
|
|
|
|
|
Proceeds from sale-leaseback of vessels |
- |
|
- |
|
139,080 |
|
146,523 |
Proceeds from long-term debt |
33,150 |
|
- |
|
69,850 |
|
- |
Payments of leaseback obligations |
(5,962) |
|
(3,160) |
|
(153,904) |
|
(8,309) |
Debt repayment |
(46,998) |
|
(31,183) |
|
(146,747) |
|
(262,572) |
Payments of accumulated accrued interest |
(4,853) |
|
(8,512) |
|
(25,639) |
|
(35,358) |
Repurchase of common stock |
(31,127) |
|
- |
|
(31,127) |
|
- |
Paid-in capital |
- |
|
54,440 |
|
- |
|
54,440 |
Share issuance costs |
- |
|
(873) |
|
- |
|
(873) |
Finance costs |
(50) |
|
- |
|
(19,963) |
|
(30,474) |
Net Cash provided by/(used in) Financing Activities |
(55,840) |
|
10,712 |
|
(168,450) |
|
(136,623) |
Net Increase/(Decrease) in cash and cash equivalents |
(40,705) |
|
56,347 |
|
(73,507) |
|
61,895 |
Cash and cash equivalents, beginning of period |
106,368 |
|
82,823 |
|
139,170 |
|
77,275 |
Cash and cash equivalents, end of period |
|
|
|
|
|
|
|
DANAOS CORPORATION |
|||||||
Reconciliation of Net Income to Adjusted EBITDA - Unaudited |
|||||||
(Expressed in thousands of United States dollars) |
|||||||
|
Three months
|
|
Three months
|
|
Year ended |
|
Year ended |
December 31, |
December 31, |
December 31, |
December 31, |
||||
|
2020 |
|
2019 |
|
2020 |
|
2019 |
Net income |
|
|
|
|
|
|
|
Depreciation |
25,927 |
|
24,364 |
|
101,531 |
|
96,505 |
Amortization of deferred drydocking & special survey costs |
2,607 |
|
2,208 |
|
11,032 |
|
8,733 |
Amortization of deferred finance costs, debt discount and other finance fees accrued |
4,631 |
|
4,152 |
|
17,338 |
|
17,422 |
Amortization of deferred realized losses on interest rate swaps |
913 |
|
913 |
|
3,632 |
|
3,622 |
Interest income |
(1,686) |
|
(1,663) |
|
(6,638) |
|
(6,414) |
Interest expense |
7,136 |
|
13,146 |
|
36,687 |
|
55,203 |
Stock based compensation |
302 |
|
1,181 |
|
1,199 |
|
4,241 |
Adjusted EBITDA(1) |
|
|
|
|
|
|
|
| 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 and stock based compensation. 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 and year ended December 31, 2020 and 2019. 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 source version on businesswire.com: https://www.businesswire.com/news/home/20210216005671/en/
FAQ
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