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Danaos Corporation Reports Second Quarter and Half Year Results for the Period Ended June 30, 2008 ATHENS, GREECE--(MARKET WIRE)--Jul 28, 2008 -- Danaos Corporation ("Danaos") (DAC - News), a
leading international owner of containerships, today reported
unaudited
results for the period ended June 30, 2008. Highlights for the Second Quarter and Half Year Ended June 30, 2008:
-- Net earnings from continuing operations of $33.7 million or $0.62 per
share and $65.3 million or $1.20 per share for the quarter and the half
year ended June 30, 2008, respectively, compared to $29.0 million or $0.53
per share and $53.0 million or $0.97 per share for the respective periods
of 2007.
-- Operating revenues from continuing operations of $73.9 million and
$143.8 million for the quarter and the half year ended June 30, 2008,
respectively, compared to $62.8 million and $124.9 million for the
respective periods of 2007.
-- EBITDA from continuing operations of $54.8 million and $105.9 million
for the quarter and the half year ended June 30, 2008, respectively,
compared to $43.2 million and $82.5 million for the respective periods of
2007.
-- Paid dividends of $0.465 per share on May 14, 2008, for the first
quarter of 2008 and declared dividends of $0.465 per share for the second
quarter of 2008, payable on August 20, 2008, for all shareholders on record
as of August 6, 2008.
Danaos' CEO Dr. John Coustas commented: "We are very pleased with our second quarter and half year 2008 results. During the first half of 2008, we continued to successfully implement our growth strategy, adding additional vessel capacity and further diversifying our customer base. During the second quarter, the Montreal Senator commenced its new 2 year charter out. There are no other charter renewals required in 2008. In May, we sold the 30 year-old Maersk Constantia for a net profit of $9.3 million. During the second quarter, we have more intensely focussed on our efforts to control costs and further boost the quality of our operations and the overall performance of our fleet. We have also undertaken all necessary actions to provide for the successful integration of our 34 vessel new-building program. In the second quarter, markets in the main Transpacific and Europe Far-East trades deteriorated. The Transpacific trades declined by approximately 2% to 3% and the growth in Europe Far-East trades dropped from 20% in the first half of 2007 to 10% in the first half of 2008. Peripheral routes in the Middle East, South America, India and intra-Asia, however, have continued to evidence resilience and strong growth patterns. This fact, together with slow steaming that many liner companies began to adopt, will mitigate any adverse effects stemming from reduction in overall demand. Charter market rates reflected a weakening in the sub 3,000 TEU sizes, giving up the gains of 2007 and returning to 2006 levels. Larger size vessels continue to trade at their highs despite some subletting activity. A difficult to quantify, but yet important factor to the analysis of trends is the effect on the overall volume of Asia related trades due to the Beijing Olympics. Factories close to the Olympic venues have reduced or even stopped production in an effort to alleviate pollution and this effect is taking its toll on China's export activity. Trends in demand should become clearer during the 3rd quarter as the impact of the crisis in financial markets, rising commodity prices and inflationary pressures are reflected in revisions to economic growth projections. The long term fixed rate charters under which the Company's vessels are deployed protect us from current charter market volatility. Consistent with past practice, we will continue to closely monitor the market for any opportunities that may arise. Our strong balance sheet and solid income base give us the confidence to consider any such accretive opportunities. On July 25, 2008, our Board of Directors declared a dividend of $0.465 per share for the second quarter, which will be paid on August 20, 2008. The dividend reflects our dedication to support shareholder value through enhanced distributable cash flows, resulting from the successful implementation of our growth strategy."
During the quarter ended June 30, 2008, Danaos had an average of 37.5 containerships as opposed to 30.9 containerships for the same period of 2007. On May 20, 2008 we sold a thirty year old vessel, the Maersk Constantia. Given the sale of our entire dry bulk fleet in the beginning of 2007, management has determined that the dry bulk business constituted discontinued operations. The management and discussion analysis solely reflects results from continuing operations (containerships), unless otherwise noted. Our net income was $33.7 million or $0.62 per share for the second quarter of 2008 compared to $29.0 million or $0.53 per share for the second quarter of 2007, an increase in net income of 16.2% or $4.7 million. Earnings per share, excluding the gain on sale of vessels of $9.3 million, was $0.45 for the second quarter of 2008. Distributable cash flow, defined as net income before depreciation & amortization, less payments for drydocking and special survey costs was $44.8 million for the second quarter of 2008. Our declared dividend of $25.4 million for the second quarter of 2008 represents 56.7% of our distributable cash flow. Operating Revenue Operating revenue increased 17.7%, or $11.1 million, to $73.9 million in the quarter ended June 30, 2008 from $62.8 million in the quarter ended June 30, 2007. The increase was primarily attributed to the addition to our fleet of 11 vessels, as follows: Vessel Name Vessel Size (TEU) Date Delivered ------------------- ----------------- ------------------- YM Singapore 4,300 October 9, 2007 YM Seattle 4,253 September 10, 2007 YM Vancouver 4,253 November 27, 2007 Hyundai Vladivostok 2,200 July 23, 2007 Hyundai Advance 2,200 August 20, 2007 Hyundai Stride 2,200 September 5, 2007 Hyundai Future 2,200 October 2, 2007 Hyundai Sprinter 2,200 October 15, 2007 Hyundai Progress 2,200 February 11, 2008 Hyundai Highway 2,200 March 18, 2008 Hyundai Bridge 2,200 March 20, 2008 These additions to our fleet contributed revenues of $18.8 million during the three months ended June 30, 2008. In addition, the Company sold five vessels as follows: Vessel Name Vessel Size (TEU) Date Sold ------------------- ----------------- ------------------- APL Scotland 5,506 June 22, 2007 APL Holland 5,506 August 3, 2007 APL Belgium 5,506 January 15, 2008 Winterberg 3,101 January 25, 2008 Maersk Constantia 3,101 May 20, 2008 The vessel sales reduced operating revenue by $7.3 million during the three months ended June 30, 2008 compared to the same period in the prior year. The balance of $0.4 million is attributed to more scheduled off-hire days, decreased by higher charter rates achieved due to the re-chartering of certain vessels. As a result, our fleet utilization reached 97.7% in the second quarter of 2008. Vessel Operating Expenses Vessel operating expenses increased 43.0% or $6.8 million, to $22.6 million in the quarter ended June 30, 2008, from $15.8 million in the quarter ended June 30, 2007. The increase was mainly due to the increase in the average number of our vessels in our fleet and a general increase in costs experienced by the overall industry during the quarter ended June 30, 2008 compared to the quarter ended June 30, 2007. Depreciation & Amortization Depreciation & Amortization includes Depreciation and Amortization of Deferred Dry-docking and Special Survey Costs. Depreciation Depreciation expense increased 26.5%, or $2.6 million, to $12.4 million in the quarter ended June 30, 2008, from $9.8 million in the quarter ended June 30, 2007. The increase in depreciation expense was due to the increased average number of vessels in our fleet during the quarter ended June 30, 2008 compared to the same period of 2007. Amortization of Deferred Dry-docking and Special Survey Costs Amortization of deferred dry-docking and special survey costs increased 28.6%, or $0.4 million, to $1.8 million in the quarter ended June 30, 2008, from $1.4 million in the quarter ended June 30, 2007. The increase reflects higher drydocking costs incurred, which were subject to amortization during the three months ended June 30, 2008 as compared to the same period of 2007. General and Administrative Expenses General and administrative expenses increased 15.4%, or $0.4 million, to $3.0 million in the quarter ended June 30, 2008, from $2.6 million in the same quarter of 2007. The increase was a result of increased fees of $0.4 million paid to our Manager in the second quarter of 2008 compared to the same period of 2007 based on an increase in the average number of our vessels in our fleet. Gain / (loss) on sale of vessels The gain on sale of vessels for the period ended June 30, 2008, reflects the sale of the Maersk Constantia for $15.8 million resulting in a net gain of $9.3 million. Other Operating Expenses Other Operating Expenses include Voyage Expenses Voyage Expenses Voyage expenses increased 62.5% or $1.0 million, to $2.6 million in the quarter ended June 30, 2008, from $1.6 million for the quarter ended June 30, 2007. The increase was mainly a result of increased bunker costs of $0.7 million, attributed to the repositioning of two of our vessels in the second quarter of 2008 compared to the same period in 2007. Our vessels are not otherwise subject to fuel costs, which are picked up by our charterers. Interest Expense and Interest Income Interest expense increased 83.3%, or $3.5 million, to $7.7 million in the quarter ended June 30, 2008, from $4.2 million in the quarter ended June 30, 2007. The change in interest expense was due to the increase in our average debt by $882.0 million to $1,569.5 million in the quarter ended June 30, 2008 from $687.5 million in the quarter ended June 30, 2007, partially offset by the financing of our extensive new-building program which resulted in interest capitalization of $11.5 million for the quarter ended June 30, 2008 as opposed to $4.3 million of capitalized interest for the quarter ended June 30, 2007. Interest income decreased by $0.4 million, to $0.9 million in the quarter ended June 30, 2008, from $1.3 million in the quarter ended June 30, 2007. The decrease in interest income is mainly attributed to lower interest rates, which is partially offset by higher average bank deposits during the three months ended June 30, 2008 as opposed to the three months ended June 30, 2007. EBITDA EBITDA from continuing operations increased by $11.6 million, or 26.8%, to $54.8 million in the quarter ended June 30, 2008, from $43.2 million in the quarter ended June 30, 2007. A table reconciling EBITDA to net income can be found at the end of this earnings release. Net income (loss) from discontinued operations During the second quarter of 2008, we recorded an expense of $1.5 million following an adverse outcome of a legal case regarding the operation of one of our dry bulk vessels sold in May 2007. Six months ended June 30, 2008 compared to the six months ended June 30, 2007 During the six months ended June 30, 2008, Danaos had an average of 36.9 containerships as opposed to 30.9 containerships for the same period of 2007. During the first half of 2008, we acquired three vessels, the Hyundai Progress on February 11, 2008, the Hyundai Highway on March 18, 2008 and the Hyundai Bridge on March 20, 2008. In addition, we sold three vessels, the APL Belgium on January 15, 2008, the Winterberg on January 25, 2008 and the Maersk Constantia on May 20, 2008. Given the sale of our entire dry bulk fleet in the beginning of 2007, management has determined that the dry bulk business constituted discontinued operations. The management and discussion analysis solely reflects results from continuing operations (containerships), unless otherwise noted. Our net income was $65.3 million or $1.20 per share for the first half of 2008 compared to $53.0 million or $0.97 per share for the first half of 2007, an increase in net income of 23.2% or $12.3 million. Earnings per share, excluding the gain on sale of vessels of $14.9 million, was $0.92 for the first six months of 2008. Distributable cash flow, defined as net income before depreciation & amortization, less payments for drydocking and special survey costs, was $86.5 million for the first half of 2008. We paid a dividend of $25.4 million for the first quarter of 2008 and we declared a dividend of $25.4 million for the second quarter of 2008, which in aggregate represent 58.7% of our distributable cash flow for the six months ended June 30, 2008. Operating Revenue Operating revenue increased 15.1%, or $18.9 million, to $143.8 million in the six months ended June 30, 2008 from $124.9 million in the six months ended June 30, 2007. The increase was primarily attributed to the addition to our fleet of 11 vessels, as follows: Vessel Name Vessel Size (TEU) Date Delivered ------------------- ---------------- ------------------- YM Singapore 4,300 October 9, 2007 YM Seattle 4,253 September 10, 2007 YM Vancouver 4,253 November 27, 2007 Hyundai Vladivostok 2,200 July 23, 2007 Hyundai Advance 2,200 August 20, 2007 Hyundai Stride 2,200 September 5, 2007 Hyundai Future 2,200 October 2, 2007 Hyundai Sprinter 2,200 October 15, 2007 Hyundai Progress 2,200 February 11, 2008 Hyundai Highway 2,200 March 18, 2008 Hyundai Bridge 2,200 March 20, 2008 These additions to our fleet contributed revenues of $34.4 million during the six months ended June 30, 2008. Moreover, a 4,300 TEU containership, the YM Colombo which was added to our fleet on March 12, 2007, contributed incremental revenues of $1.9 million during the six months ended June 30, 2008 compared to the same period in 2007. In addition, the Company sold six vessels as follows: Vessel Name Vessel Size (TEU) Date Sold ------------------- ---------------- ------------------- APL England 5,506 March 7, 2007 APL Scotland 5,506 June 22, 2007 APL Holland 5,506 August 3, 2007 APL Belgium 5,506 January 15, 2008 Winterberg 3,101 January 25, 2008 Maersk Constantia 3,101 May 20, 2008 These sales reduced operating revenue by $16.5 million during the six months ended June 30, 2008 compared to the same period in the prior year. The balance of $0.9 million is attributable to more scheduled off-hire days, partially offset by higher charter rates achieved due to the re-chartering of certain of our vessels. Vessel Operating Expenses Vessel operating expenses increased 36.3% or $11.3 million, to $42.4 million in the six months ended June 30, 2008, from $31.1 million in the six months ended June 30, 2007. The increase was mainly due to the increase in the average number of our vessels in our fleet and a general increase in costs experienced by the overall industry during the six months ended June 30, 2008 compared to the six months ended June 30, 2007. Depreciation & Amortization Depreciation & Amortization includes Depreciation and Amortization of Deferred Dry-docking and Special Survey Costs. Depreciation Depreciation expense increased 23.6%, or $4.6 million, to $24.1 million in the six months ended June 30, 2008, from $19.5 million in the six months ended June 30, 2007. The increase in depreciation expense was due to the increased average number of vessels in our fleet during the six months ended June 30, 2008, compared to the same period of 2007. Amortization of Deferred Dry-docking and Special Survey Costs Amortization of deferred dry-docking and special survey costs increased 21.4%, or $0.6 million, to $3.4 million in the six months ended June 30, 2008, from $2.8 million in the six months ended June 30, 2007. The increase reflects higher dry-docking costs incurred, which were subject to amortization during the six months ended June 30, 2008 as compared to the same period of 2007. General and Administrative Expenses General and administrative expenses increased 20.8%, or $1.0 million, to $5.8 million in the six months ended June 30, 2008, from $4.8 million in the same period of 2007. The increase was mainly a result of increased fees of $0.7 million paid to our Manager in the first half of 2008 compared to the same period of 2007 based on an increase in the average number of our vessels in our fleet. Moreover, various administrative expenses were higher by $0.3 million in the six months ended June 30, 2008 compared with the six months ended June 30, 2007. Gain / (loss) on sale of vessels The gain on sale of vessels for the six months ended June 30, 2008, reflects the sale of the APL Belgium, the Winterberg and the Maersk Constantia for $44.5 million, $11.2 million and $15.8 million, respectively, resulting in an aggregate net gain of $14.9 million. Other Operating Expenses Other Operating Expenses include Voyage Expenses Voyage Expenses Voyage expenses increased 23.5% or $0.8 million, to $4.2 million in the six months ended June 30, 2008, from $3.4 million for the six months ended June 30, 2007. The increase was mainly a result of increased bunker costs of $0.7 million, attributed to the repositioning of two of our vessels in the six months ended June 30, 2008 compared to the same period in 2007. Our vessels are not otherwise subject to fuel costs, which are picked up by our charterers. Interest Expense and Interest Income Interest expense increased 55.7%, or $5.4 million, to $15.1 million in the quarter ended June 30, 2008, from $9.7 million in the quarter ended June 30, 2007. The change in interest expense was due to the increase in our average debt by $809.2 million to $1,475.2 million in the six months ended June 30, 2008 from $666.0 million in the six months ended June 30, 2007, partially offset by the financing of our extensive new-building program which resulted in capitalized interest of $22.8 million for the quarter ended June 30, 2008 as opposed to $7.0 million of capitalized interest for the quarter ended June 30, 2007. Interest income decreased by $0.7 million, to $1.9 million in the six months ended June 30, 2008, from $2.6 million in the six months ended June 30, 2007. The decrease in interest income is mainly attributed to lower interest rates, partially offset by higher average bank deposits during the six months ended June 30, 2008 as opposed to the six months ended June 30, 2007. Other income/(expenses), net Other income (expenses) decreased by $2.9 million, to $(0.1) million for the six months ended June 30, 2008, from $(3.0) million in the six months ended June 30, 2007. EBITDA EBITDA from continuing operations increased by $23.4 million, or 28.4%, to $105.9 million in the six months ended June 30, 2008, from $82.5 million in the six months ended June 30, 2007. A table reconciling EBITDA to net income can be found at the end of this earnings release. Dividend Payment On April 18, 2008, the Board of Directors declared a dividend of $0.465 per common share for the first quarter of 2008 paid on May 14, 2008 to all shareholders of record as of April 30, 2008. On July 25, 2008, the Board of Directors declared a dividend of $0.465 per common share for the second quarter of 2008 for all shareholders of record as of August 6, 2008, payable on August 20, 2008. Recent News On July 4, 2008, the Company took delivery of the new-building 4,253 TEU vessel, the Zim Rio Grande. The vessel is time chartered out for 12 years to one of the world's major liner companies. Conference Call and Webcast On Tuesday, July 29, 2008 at 9:00 A.M. EDT, the Company's management will host a conference call to discuss the results. Conference Call details: Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1 866 819 7111 (US Toll Free Dial In), 0800 953 0329 (UK Toll Free Dial In) or +44 (0)1452 542 301 (Standard International Dial In). Please quote "Danaos" to the operator. In case of any problems with the above numbers, please dial 1 866 223 0615 (US Toll Free Dial In). 0800 694 1503 (UK Toll Free Dial In) or +44 (0)1452 586 513 (Standard International Dial In). Please quote "Danaos" to the operator. A telephonic replay of the conference call will be available until August 5, 2008 by dialing 1 866 247 4222 (US Toll Free Dial In), 0800 953 1533 (UK Toll Free Dial In) or +44 (0)1452 550 000 (Standard International Dial In). Access Code: 1186615# Audio webcast: There will also be a live and then archived webcast of the conference call through the Danaos website (www.danaos.com). Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast. About Danaos Corporation Danaos Corporation is an international owner of containerships, chartering its vessels to many of the world's largest liner companies. Our current fleet of 38 containerships aggregating 150,870 TEUs ranks Danaos among the largest containership charter owners in the world based on total TEU capacity. Danaos is the largest US listed containership company based on fleet size. Furthermore, the company has a contracted fleet of 33 additional containerships aggregating 239,215 TEU with scheduled deliveries up to 2011. The company's shares trade on the New York Stock Exchange under the symbol "DAC." Forward-Looking Statement Matters discussed in this release may constitute forward-looking statements within the meaning of the safeharbor 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, many of which are based, in turn, upon further assumptions, including without limitation, management's examination of historical operating trends, data contained in our records and other data available from third parties. 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, shipyard 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, dry-docking and insurance costs, 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 78 off-hire days in total in the second quarter of 2008. The following table summarizes vessel utilization and the impact of the off-hire days on the company's revenue relating to the last four quarters.
Third Fourth First Second
Quarter Quarter Quarter Quarter
2007 2007 2008 2008 Total
--------- --------- --------- --------- ---------
No. of No. of No. of No. of No. of
Vessel utilization Days Days Days Days Days
--------- --------- --------- --------- ---------
Ownership days 2,861 3,324 3,301 3,417 12,903
Less Off-hire Days:
Scheduled
Drydocking (49) (81) (159) (78) (367)
Other off-hire Days -- (24) (1) -- (25)
--------- --------- --------- --------- ---------
Operating Days 2,812 3,219 3,141 3,339 12,511
Vessel Utilization 98.3% 96.8% 95.2% 97.7% 97.0%
Revenue - Impact of Off-hire (in '000s of US dollars)
--------- --------- --------- --------- ---------
100% fleet
utilization $ 63,698 $ 72,006 $ 70,689 $ 74,482 $ 280,875
Less Off-hire Days:
Scheduled Drydocking (1,055) (46) (796) (573) (2,470)
Other off-hire Days -- (625) (16) -- (641)
--------- --------- --------- --------- ---------
Actual Revenue
Earned $ 62,643 $ 71,335 $ 69,877 $ 73,909 $ 277,764
========= ========= ========= ========= =========Fleet List The following table describes in detail our fleet deployment profile as of July 28, 2008.
Vessel Year Expiration of
Vessel Name Size (TEU) Built Charter(1)
---------- ------ --------------
Containerships
CSCL Le Havre 9,580 2006 September 2018
CSCL Pusan 9,580 2006 July 2018
MSC Baltic 8,468 2004 September 2016
CSCL Europe 8,468 2004 June 2016
Maersk Marathon 4,814 1991 September 2011
Maersk Messologi 4,814 1991 September 2011
Maersk Mytilini 4,814 1991 September 2011
MOL Affinity(2) 4,651 1992 March 2011
Hyundai Duke 4,651 1992 February 2011
APL Confidence(3) 4,651 1994 September 2012
YM Colombo 4,300 2004 March 2019
YM Singapore 4,300 2004 October 2019
YM Seattle 4,253 2007 July 2019
YM Vancouver 4,253 2007 September 2019
Maersk Derby 4,253 2004 February 2009
Maersk Deva 4,253 2004 January 2009
ZIM Rio Grande 4,253 2008 May 2020
Al Rayyan 3,908 1989 January 2011
YM Yantian 3,908 1989 July 2011
YM Milano 3,129 1988 May 2011
SA Helderberg 3,101 1977 November 2008
Sederberg 3,101 1978 January 2009
CMA CGM Lotus 3,098 1988 July 2010
CMA CGM Vanille 3,045 1986 July 2010
CMA CGM Passiflore 3,039 1986 May 2010
CMA CGM Elbe 2,917 1991 June 2010
CMA CGM Kalamata 2,917 1991 June 2010
CMA CGM Komodo 2,917 1991 June 2010
Hyundai Advance 2,200 1997 June 2017
Hyundai Future 2,200 1997 August 2017
Hyundai Sprinter 2,200 1997 August 2017
Hyundai Stride 2,200 1997 July 2017
Hyundai Progress 2,200 1998 December 2017
Hyundai Bridge 2,200 1998 January 2018
Hyundai Highway 2,200 1998 January 2018
Hyundai Vladivostok 2,200 1997 May 2017
Montreal Senator(4) 2,130 1984 March 2010
MSC Eagle 1,704 1978 January 2010
(1) Earliest date charters could expire. Some charters include options to
extend their term.
(2) On April 15, 2008, the Hyundai Commodore was renamed to MOL Affinity at
the request of the charterer of this vessel.
(3) On June 2, 2008, the MOL Confidence was renamed to APL Confidence at
the request of the charterer of this vessel.
(4) On April 8, 2008, the Pacific Bridge was renamed to Montreal Senator at
the request of the charterer of this vessel.New Deliveries The following table describes the expected additions to our fleet as a result of our new building containership program.
Vessel Expected Time Charter
Vessel Name Size (TEU) Delivery Term
---------- -------------- ----------
HN1671 4,253 September 2008 12 years
HN1672 4,253 November 2008 12 years
HN1673 4,253 December 2008 12 years
HN1698 4,253 March 2009 12 years
HNS4001(1) 6,500 April 2009 12 years
HN1699 4,253 June 2009 12 years
HNS4002(1) 6,500 June 2009 12 years
HNS4003(1) 6,500 August 2009 12 years
HNS4004(1) 6,500 October 2009 12 years
HN N-214 6,500 November 2009 18 years
HN N-219 3,400 November 2009 10 years
HNS4005(1) 6,500 December 2009 12 years
HN N-220 3,400 January 2010 10 years
HN N-215 6,500 January 2010 18 years
HN N-221 3,400 February 2010 10 years
HN N-216 6,500 March 2010 15 years
HN N-222 3,400 April 2010 10 years
HN N-223 3,400 May 2010 10 years
HN N-217 6,500 May 2010 15 years
HN Z00001 8,530 May 2010 12 years
HN Z00002 8,530 May 2010 12 years
HN Z00003 8,530 July 2010 12 years
HN Z00004 8,530 July 2010 12 years
HN N-218 6,500 July 2010 15 years
HULL 1022A 8,530 September 2010 12 years
Hull No S-461 10,100 January 2011 12 years
Hull No S-456 12,600 January 2011 12 years
Hull No S-462 10,100 February 2011 12 years
Hull No S-463 10,100 March 2011 12 years
Hull No S-457 12,600 March 2011 12 years
Hull No S-458 12,600 May 2011 12 years
Hull No S-459 12,600 June 2011 12 years
Hull No S-460 12,600 August 2011 12 years
(1) Vessel subject to charterer's option to purchase vessel after first
eight years of time charter term for $78.0 million.
DANAOS CORPORATION
Statements of Income
(Expressed in thousands of United States dollars, except share and per
share amounts)
Three months Three months Six months Six months
ended ended ended ended
June 30, June 30, June 30, June 30,
---------- ---------- ---------- ----------
2008 2007 2008 2007
---------- ---------- ---------- ----------
(unaudited) (unaudited) (unaudited) (unaudited)
OPERATING REVENUES $ 73,909 $ 62,839 $ 143,786 $ 124,867
OPERATING EXPENSES
Vessel operating
expenses (22,554) (15,784) (42,364) (31,088)
Depreciation &
amortization (14,123) (11,214) (27,492) (22,385)
General & administrative (3,020) (2,616) (5,833) (4,810)
Gain / (loss) on sale of
vessels 9,346 (29) 14,928 (235)
Other operating expenses (2,704) (1,609) (4,340) (3,363)
---------- ---------- ---------- ----------
Income From Operations 40,854 31,587 78,685 62,986
---------- ---------- ---------- ----------
OTHER EARNINGS (EXPENSES)
Interest income 854 1,295 1,940 2,559
Interest expense (7,739) (4,204) (15,079) (9,677)
Other finance cost, net (851) (336) (1,276) (897)
Other income /
(expenses), net 211 (132) (82) (2,959)
Gain / (loss) on
derivatives 413 838 1,071 942
---------- ---------- ---------- ----------
Total Other Income
(Expenses), net (7,112) (2,539) (13,426) (10,032)
---------- ---------- ---------- ----------
Net income from continuing
operations $ 33,742 $ 29,048 $ 65,259 $ 52,954
---------- ---------- ---------- ----------
Net (loss) income from
discontinued operations (1,527) 15,717 (1,522) 92,177
---------- ---------- ---------- ----------
Net Income $ 32,215 $ 44,765 $ 63,737 $ 145,131
========== ========== ========== ==========
EARNINGS PER SHARE (from
continuing operations)
Basic and diluted net
income per share $ 0.62 $ 0.53 $ 1.20 $ 0.97
========== ========== ========== ==========
EARNINGS PER SHARE
Basic and diluted net
income per share $ 0.59 $ 0.82 $ 1.17 $ 2.66
========== ========== ========== ==========
Basic and diluted weighted
average number of shares
(in thousands of shares) 54,558 54,558 54,558 54,558
========== ========== ========== ==========
DANAOS CORPORATION
Balance Sheets
(Expressed in thousands of United States dollars)
As of As of
June 30, December 31,
------------- -------------
2008 2007
------------- -------------
(unaudited) (unaudited)
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 101,663 $ 63,495
Restricted cash 45,462 46,179
Accounts receivable, net 2,277 4,321
Other current assets 19,841 18,993
------------- -------------
169,243 132,988
NON-CURRENT ASSETS
Fixed assets, net $ 1,180,961 $ 1,182,505
Advances for vessel acquisitions and
vessels under construction 991,404 745,534
Deferred charges, net 14,246 10,431
Other non-current assets 165 333
------------- -------------
2,186,776 1,938,803
------------- -------------
TOTAL ASSETS 2,356,019 2,071,791
============= =============
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Long-term debt, current portion 32,219 25,619
Accounts payable, accrued liabilities &
other current liabilities 31,797 24,092
Fair value of financial instruments,
current portion 630 1,402
------------- -------------
64,646 51,113
LONG-TERM LIABILITIES
Long-term debt, net of current portion 1,595,706 1,330,927
Fair value of financial instruments, net
of current portion 57,809 56,537
Other long-term liabilities 7,220 8,310
------------- -------------
1,660,735 1,395,774
STOCKHOLDERS' EQUITY
Common stock 546 546
Additional paid-in capital 288,553 288,530
Accumulated other comprehensive income (62,173) (54,886)
Retained earnings 403,712 390,714
------------- -------------
630,638 624,904
------------- -------------
Total liabilities and stockholders' equity $ 2,356,019 $ 2,071,791
============= =============
DANAOS CORPORATION
Statements of Cash Flows
(Expressed in thousands of United States dollars)
Three Three Six Six
months months months months
ended ended ended ended
June 30, June 30, June 30, June 30,
--------- --------- --------- ---------
2008 2007 2008 2007
--------- --------- --------- ---------
(unaudited)(unaudited)(unaudited)(unaudited)
Cash Flows provided by / (used in):
Operating Activities:
Net income $ 32,215 $ 44,765 $ 63,737 $ 145,131
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation 12,366 9,849 24,125 20,018
Amortization of deferred
charges 1,791 1,477 3,434 3,024
Written off amount of
deferred charges 128 -- 309 284
Stock based compensation 23 -- 23 --
Payments for drydocking /
special survey (3,072) (2,768) (6,256) (4,626)
Change in fair value of debt
and financial instruments (5,321) (3,468) (7,102) (1,059)
(Gain) / Loss on sale of
vessels (9,346) (15,704) (14,928) (88,400)
Accounts receivable 690 1,174 2,044 483
Other assets, current and
non-current 2,097 689 (630) (6,236)
Accounts payable and accrued
liabilities 4,334 2,241 7,245 (1,180)
Other liabilities, current
and non-current (597) 17,768 (630) 15,751
--------- --------- --------- ---------
Cash provided by Operating
Activities 35,308 56,023 71,371 83,190
--------- --------- --------- ---------
Investing Activities:
Vessel acquisitions
including advances (240) 16 (76,480) (55,735)
Vessels under construction (108,590) (104,288) (245,870) (161,868)
Proceeds from sale of
vessels 14,646 69,800 69,103 231,287
--------- --------- --------- ---------
Cash (used in) / provided by
Investing Activities (94,184) (34,472) (253,247) 13,684
--------- --------- --------- ---------
Financing Activities:
Debt draw downs 130,440 114,677 315,453 236,177
Debt repayment (3,592) (49,269) (43,809) (231,627)
Dividends paid (25,370) (24,006) (50,739) (48,011)
Deferred costs (399) (370) (1,578) (870)
Increase in restricted cash (4,255) (41,674) 717 (39,203)
--------- --------- --------- ---------
Cash provided by / (used in)
Financing Activities 96,824 (642) 220,044 (83,534)
--------- --------- --------- ---------
Net change in cash and cash
equivalents 37,948 20,909 38,168 13,340
--------- --------- --------- ---------
Cash and cash equivalents,
beginning of period 63,715 35,506 63,495 43,075
--------- --------- --------- ---------
Cash and cash equivalents, end
of period $ 101,663 $ 56,415 $ 101,663 $ 56,415
========= ========= ========= =========
Reconciliation of Net Income to EBITDA
Three Three Six Six
months months months months
ended ended ended ended
June 30, June 30, June 30, June 30,
--------- --------- --------- ---------
2008 2007 2008 2007
--------- --------- --------- ---------
(unaudited)
Net income $ 33,742 $ 29,048 $ 65,259 $ 52,954
Depreciation 12,366 9,796 24,125 19,547
Amortization of deferred
charges 1,757 1,418 3,367 2,838
Interest income (854) (1,295) (1,940) (2,559)
Interest expense 7,739 4,204 15,079 9,677
--------- --------- --------- ---------
EBITDA (1) from continuing
operations $ 54,750 $ 43,171 $ 105,890 $ 82,457
--------- --------- --------- ---------
EBITDA (1) from discontinued
operations (1,527) 15,789 (1,522) 93,125
--------- --------- --------- ---------
EBITDA (1) $ 53,223 $ 58,960 $ 104,368 $ 175,582
========= ========= ========= =========
(1) EBITDA represents net income before interest, income tax expense,
depreciation and amortization. However, EBITDA is not a recognized
measurement under U.S. generally accepted accounting principles, or
"GAAP." We believe that the presentation of 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 is useful in evaluating
our ability to service additional debt and make capital expenditures.
In addition, we believe that EBITDA is useful in evaluating our
operating performance and liquidity position compared to that of other
companies in our industry because the calculation of 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 and liquidity.Contact: For further information please contact:
Company Contact:
Dimitri J. Andritsoyiannis
Chief Financial Officer
Danaos Corporation
Athens, Greece
Tel.: +30 210 419 6481
E-Mail: cfo@danaos.com
Iraklis Prokopakis
Chief Operating Officer
Danaos Corporation
Athens, Greece
Tel.: +30 210 419 6400
E-Mail: coo@danaos.com
Investor Relations and Financial Media
Nicolas Bornozis
President
Capital Link, Inc.
New York
Tel. 212-661-7566
E-Mail: danaos@capitallink.com
Source: Danaos Corporation
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