ATHENS, Greece, May 30, 2017 /PRNewswire/ -- Danaos
Corporation ("Danaos") (NYSE: DAC), one of the world's largest
independent owners of containerships, today reported unaudited
results for the quarter ended March 31,
2017.
Highlights for the First Quarter Ended March 31, 2017:
- Adjusted net income1 of $24.5 million, or $0.22 per share, for the three months ended
March 31, 2017 compared to
$47.2 million, or $0.43 per share, for the three months ended
March 31, 2016, a decrease of
48.1%.
- Operating revenues of $110.1
million for the three months ended March 31, 2017 compared to $137.5 million for the three months ended
March 31, 2016, a decrease of
19.9%.
- Adjusted EBITDA1of $72.5 million for the three months ended
March 31, 2017 compared to
$99.4 million for the three months
ended March 31, 2016, a decrease of
27.0%.
- Total contracted operating revenues were $2.0 billion as of March
31, 2017, with charters extending through 2028 and remaining
average contracted charter duration of 6.4 years, weighted by
aggregate contracted charter hire.
- Charter coverage of 90.0% for the next 12 months based on
current operating revenues and 73.0% in terms of contracted
operating days.
Three Months Ended
March 31, 2017
Financial
Summary
(Expressed
in thousands of United States dollars, except per share
amounts)
|
|
|
Three months
ended
|
|
Three months
ended
|
March
31,
|
March
31,
|
|
2017
|
|
2016
|
|
|
|
|
Operating
revenues
|
$110,087
|
|
$137,474
|
Net income
|
$18,443
|
|
$44,121
|
Adjusted net
income1
|
$24,522
|
|
$47,228
|
Earnings per
share
|
$0.17
|
|
$0.40
|
Adjusted earnings per
share1
|
$0.22
|
|
$0.43
|
Weighted average
number of shares (in thousands)
|
109,825
|
|
109,800
|
Adjusted
EBITDA1
|
$72,546
|
|
$99,351
|
|
|
|
|
|
|
|
|
|
|
|
|
1Adjusted net income, adjusted
earnings per share and adjusted EBITDA are non-GAAP measures. Refer
to the reconciliation of net income to adjusted net income and net
income to adjusted EBITDA.
|
Danaos' CEO Dr. John Coustas
commented:
"The results of Danaos for the first quarter of 2017 continue to
reflect the impact of the Hanjin bankruptcy on the Company's
financial performance. The $22.7
million decrease in our adjusted net income was primarily
attributable to $22 million of
operating revenues lost from Hanjin. Excluding the off-hire days
related to three 10,100 TEU vessels that were previously chartered
by Hanjin and were delivered to their new charterers in
April 2017, our fleet utilization
increased to 98.1% compared to 94.6% in the first quarter of
2016. Including those vessels, our fleet utilization was
92.7%.
As previously reported, the Company is in breach of certain
financial covenants as a result of the Hanjin bankruptcy. We had
obtained a waiver for these breaches until April 1, 2017. We have asked our lenders for an
extension of this waiver until July 1,
2017 and are engaged in constructive conversations to
resolve this matter. In the meantime, we continue to generate
positive cash flows from our operations and currently are in a
position to service all our operational obligations as well as all
scheduled principal and interest payments under the original terms
of our debt agreements.
Charter rates increased during the month of April. These
increases were considerable on a percentage basis, but still low in
absolute terms at levels that may be slightly above operating
expenses, but still not enough to service investment returns. This
market improvement is mainly due to the commencement of the new
alliances between liner companies. While we do not expect the
market to return to the lows of 2016, we also see signs of the
charter market tailing off. Nonetheless, the more disciplined
capacity utilization strategy by the liner companies in the context
of the new alliances has led to an improvement in box rates which
has in turn improved the performance of our customers and reduced
our counterparty credit risks.
Danaos continues to have low near term exposure to the weak spot
market with charter coverage of 90% for the next 12 months based on
current operating revenues and 73% in terms of contracted operating
days.
During this extended period of market weakness which has
presented many challenges, we remain focused on taking necessary
actions to preserve the value of our company by managing our fleet
efficiently and taking prudent measures to manage and ultimately
deleverage our balance sheet."
Three months ended March 31,
2017 compared to the three months ended March 31, 2016
During the three months ended March 31,
2017, Danaos had an average of 55.0 containerships compared
to 55.1 containerships for the three months ended March 31, 2016. Our fleet utilization for the
first quarter of 2017 was 92.7%, while fleet utilization for the
vessels under employment, excluding the off charter days of the
vessels that were previously chartered to Hanjin Shipping
("Hanjin"), increased to 98.1% in the three months ended
March 31, 2017 compared to 94.6% in
the three months ended March 31,
2016.
Our adjusted net income amounted to $24.5
million, or $0.22 per share,
for the three months ended March 31,
2017 compared to $47.2
million, or $0.43 per share,
for the three months ended March 31,
2016. We have adjusted our net income in the three months
ended March 31, 2017 for a non-cash
amortization charge of $3.7 million
for fees related to our 2011 comprehensive financing plan
(comprised of non-cash, amortizing and accrued finance fees) and a
loss on sale of Hyundai Merchant Marine ("HMM") securities of
$2.4 million. Please refer to the
Adjusted Net Income reconciliation table, which appears later in
this earnings release.
The decrease of $22.7 million in
adjusted net income for the three months ended March 31, 2017 compared to the three months ended
March 31, 2016 is attributable to a
$22.0 million decrease in operating
revenues as a result of the Hanjin bankruptcy. A further decline in
revenues of $5.4 million as a result
of weaker charter market conditions was partially offset by a
$2.2 million decrease in total
operating expenses, a $1.6 million
decrease in net finance costs mainly due to interest rate swap
expirations, and a $0.9 million
improvement in the operating performance of our equity investment
in Gemini Shipholdings Corporation ("Gemini").
On a non-adjusted basis, our net income amounted to $18.4 million, or $0.17 per share, for the three months ended
March 31, 2017 compared to net income
of $44.1 million, or $0.40 per share, for the three months ended
March 31, 2016.
Operating Revenues
Operating revenues decreased by
19.9%, or $27.4 million, to
$110.1 million in the three months
ended March 31, 2017 from
$137.5 million in the three months
ended March 31, 2016.
Operating revenues for the three months ended March 31, 2017 reflect:
- $22.0 million decrease in
revenues in the three months ended March 31,
2017 compared to the three months ended March 31, 2016 due to loss of revenue from
cancelled charters with Hanjin for eight of our vessels due to
Hanjin's bankruptcy. These vessels were rechartered at lower rates
and in some cases experienced off hire time in the 2017 period.
- $5.4 million decrease in revenues
in the three months ended March 31,
2017 compared to the three months ended March 31, 2016 due to the re-chartering of
certain of our vessels at lower rates.
Vessel Operating Expenses
Vessel operating expenses
decreased by 4.8%, or $1.4 million,
to $27.5 million in the three
months ended March 31, 2017 from
$28.9 million in the three
months ended March 31, 2016. The
decrease is attributable to a 3.8% decrease in the average daily
operating cost per vessel during the three months ended
March 31, 2017 compared to the three
months ended March 31, 2016.
The average daily operating cost per vessel decreased to
$5,756 per day for the three months
ended March 31, 2017 from
$5,985 per day for the three months
ended March 31, 2016. Management
believes that our daily operating cost ranks as one of the most
competitive in the industry.
Depreciation & Amortization
Depreciation &
Amortization includes Depreciation and Amortization of Deferred
Dry-docking and Special Survey Costs.
Depreciation
Depreciation expense decreased by 9.7%,
or $3.1 million, to $28.9 million in the three months ended
March 31, 2017 from $32.0 million in the three months ended
March 31, 2016, mainly due to
decreased depreciation expense for twenty-five vessels for which we
recorded an impairment charge on December
31, 2016.
Amortization of Deferred Dry-docking and Special Survey
Costs
Amortization of deferred dry-docking and special
survey costs increased by $0.7
million, to $1.7 million in
the three months ended March 31, 2017
from $1.0 million in the three months
ended March 31, 2016. The increase
was mainly due to the increased payments for dry-docking and
special survey costs related to certain vessels over the last
year.
General and Administrative Expenses
General and
administrative expenses increased by $0.9
million, to $6.1 million in
the three months ended March 31,
2017, from $5.2 million in the
three months ended March 31, 2016.
The increase was due to the increased professional fees related to
the refinancing discussions with our lenders.
Other Operating Expenses
Other Operating Expenses
include Voyage Expenses.
Voyage Expenses
Voyage expenses increased by
$0.3 million, to $3.8 million in the three months ended
March 31, 2017 from $3.5 million in the three months ended
March 31, 2016.
Interest Expense and Interest Income
Interest expense
increased by 3.5%, or $0.7 million,
to $20.9 million in the three
months ended March 31, 2017 from
$20.2 million in the three months
ended March 31, 2016. The increase in
interest expense was mainly due to the increase in average cost of
debt due to the increase in US$ Libor by almost 50 bps between the
two periods, which was partially offset by a decrease in our
average debt by $254.5 million, to
$2,483.9 million in the three months
ended March 31, 2017, from
$2,738.4 million in the three months
ended March 31, 2016 and a
$0.4 million decrease in the
amortization of deferred finance costs.
As of March 31, 2017, the debt
outstanding gross of deferred finance costs was $2,474.1 million compared to $2,727.0 million as of March 31, 2016. As a result principally of the
cancellation of eight charters with Hanjin, we expect the rate at
which we reduce our leverage to decline.
Interest income increased by $0.5
million to $1.5 million in the
three months ended March 31, 2017
compared to $1.0 million in the three
months ended March 31, 2016. The
increase was mainly attributed to the interest income recognized on
HMM notes receivable.
Other finance costs, net
Other finance costs, net
decreased by $0.1 million, to
$1.0 million in the three months
ended March 31, 2017 from
$1.1 million in the three months
ended March 31, 2016.
Equity income/(loss) on investments
Equity income on
investments amounted to $0.2 million
in the three months ended March 31,
2017 compared to the equity loss on investments of
$0.7 million in the three months
ended March 31, 2016 and relates to
the improved operating performance of Gemini, in which the Company
has a 49% shareholding interest.
Unrealized gain on derivatives
Unrealized gain on
interest rate swaps amounted to nil in the three months ended
March 31, 2017 compared to a gain of
$1.1 million in the three months
ended March 31, 2016. The unrealized
gains in the three months ended March 31,
2016 were attributable to mark to market valuation of our
swaps, which all expired by December 31,
2016.
Realized loss on derivatives
Realized loss on interest
rate swaps decreased to $0.9 million
in the three months ended March 31,
2017 from a loss of $3.1
million in the three months ended March 31, 2016. This decrease is attributable to
swap expirations. As of December 31,
2016, all of our interest rate swaps have expired.
Other income/(expenses), net
Other income/(expenses),
net decreased to $2.4 million in
expenses in the three months ended March 31,
2017 from $0.4 million in
income in the three months ended March 31,
2016 mainly due to a $2.4
million realized loss on sale of HMM securities in the three
months ended March 31, 2017.
Adjusted EBITDA
Adjusted EBITDA decreased by 27.0%, or
$26.9 million, to $72.5 million in the three months ended
March 31, 2017 from $99.4 million in the three months ended
March 31, 2016. As outlined earlier,
this decrease is mainly attributed to a $27.4 million decrease in operating revenues,
which was partially offset by a $0.9
million operating performance improvement on equity
investments. Adjusted EBITDA for the three months ended
March 31, 2017 is adjusted for a loss
on sale of HMM securities of $2.4
million. Tables reconciling Adjusted EBITDA to Net Income
can be found at the end of this earnings release.
Recent Developments
As a result of a decrease in our
operating income and the charter-attached market value of certain
of our vessels caused principally by the cancellation of eight
charters with Hanjin Shipping, which is currently under bankruptcy
proceedings with the Seoul Central District Court, we were in
breach of the minimum security cover, consolidated net leverage and
consolidated net worth financial covenants contained in our Bank
Agreement and our other credit facilities as of March 31, 2017 and December 31, 2016. We had obtained waivers of the
breaches of these financial covenants until April 1, 2017 and have requested an extension up
to July 1, 2017. We have therefore
classified our long-term debt, net of deferred finance costs as
current. We are currently in discussions with our lenders regarding
the non-compliance with these covenants, absent an extension of
these waivers. However, we continue to generate positive cash flows
from our operations and currently are in a position to service all
our operational obligations as well as all scheduled principal and
interest payments under the original terms of our debt
agreements.
Conference Call and Webcast
On Wednesday, May 31, 2017 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 June 7, 2017 by dialing 1 877
344 7529 (US Toll Free Dial In) or +44 (0) 2036 088 021 (Standard
International Dial In) and using 10108102# as the access code.
Audio Webcast
There will also be a live and then
archived webcast of the conference call through the Danaos website
(www.danaos.com). Participants of the live webcast should register
on the website approximately 10 minutes prior to the start of the
webcast.
About Danaos Corporation
Danaos Corporation is one of
the largest independent owners of modern, large-size
containerships. Our current fleet of 59 containerships aggregating
352,600 TEUs, including four vessels owned by Gemini Shipholdings
Corporation, a joint venture, ranks Danaos among the largest
containership charter owners in the world based on total TEU
capacity. Our fleet is chartered to many of the world's largest
liner companies on fixed-rate charters. Our long track record of
success is predicated on our efficient and rigorous operational
standards and environmental controls. Danaos Corporation's shares
trade on the New York Stock Exchange under the symbol "DAC".
Forward-Looking Statements
Matters discussed in this
release may constitute forward-looking statements within the
meaning of the 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, 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, 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 347 unscheduled off-hire days in the three months
ended March 31, 2017. The following
table summarizes vessel utilization and the impact of the off-hire
days on the Company's revenue.
Vessel Utilization
(No. of Days)
|
First
Quarter
2017
|
|
First
Quarter
2016
|
Ownership
Days
|
4,950
|
|
5,013
|
Less Off-hire
Days:
|
|
|
|
Scheduled Off-hire
Days
|
(15)
|
|
(31)
|
Other Off-hire
Days
|
(347)
|
|
(242)
|
Operating
Days
|
4,588
|
|
4,740
|
Vessel
Utilization
|
92.7%
|
|
94.6%
|
|
|
|
|
Operating Revenues
(in '000s of US Dollars)
|
$110,087
|
|
$137,474
|
Average Gross
Daily Charter Rate
|
$23,995
|
|
$29,003
|
Fleet List
The following table describes in detail our
fleet deployment profile as of May 30,
2017:
Vessel
Name
|
Vessel
Size
(TEU)
|
|
Year
Built
|
|
Expiration of
Charter(1)
|
|
Containerships
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hyundai
Ambition
|
13,100
|
|
2012
|
|
June 2024
|
|
Maersk Exeter (ex
Hyundai Speed)
|
13,100
|
|
2012
|
|
June 2024
|
|
Hyundai
Smart
|
13,100
|
|
2012
|
|
May 2024
|
|
Hyundai Respect
(ex Hyundai Tenacity)
|
13,100
|
|
2012
|
|
March 2024
|
|
Hyundai Honour (ex
Hyundai Together)
|
13,100
|
|
2012
|
|
February
2024
|
|
Express
Rome
|
10,100
|
|
2011
|
|
August
2017
|
|
Express
Berlin
|
10,100
|
|
2011
|
|
June 2017
|
|
Express
Athens
|
10,100
|
|
2011
|
|
August
2017
|
|
CSCL Le
Havre
|
9,580
|
|
2006
|
|
September
2018
|
|
CSCL
Pusan
|
9,580
|
|
2006
|
|
July 2018
|
|
CMA CGM
Melisande
|
8,530
|
|
2012
|
|
November 2023
|
|
CMA CGM
Attila
|
8,530
|
|
2011
|
|
April 2023
|
|
CMA CGM
Tancredi
|
8,530
|
|
2011
|
|
May 2023
|
|
CMA CGM
Bianca
|
8,530
|
|
2011
|
|
July 2023
|
|
CMA CGM
Samson
|
8,530
|
|
2011
|
|
September
2023
|
|
CSCL
America
|
8,468
|
|
2004
|
|
July 2017
|
|
Europe
|
8,468
|
|
2004
|
|
June 2017
|
|
CMA CGM
Moliere (2)
|
6,500
|
|
2009
|
|
August
2021
|
|
CMA CGM Musset
(2)
|
6,500
|
|
2010
|
|
February
2022
|
|
CMA CGM Nerval
(2)
|
6,500
|
|
2010
|
|
April 2022
|
|
CMA CGM Rabelais
(2)
|
6,500
|
|
2010
|
|
June 2022
|
|
CMA CGM Racine
(2)
|
6,500
|
|
2010
|
|
July 2022
|
|
YM
Mandate
|
6,500
|
|
2010
|
|
January
2028
|
|
YM
Maturity
|
6,500
|
|
2010
|
|
April 2028
|
|
Performance
|
6,402
|
|
2002
|
|
May 2018
|
|
Priority
|
6,402
|
|
2002
|
|
November
2017
|
|
YM
Singapore
|
4,300
|
|
2004
|
|
October
2019
|
|
YM
Seattle
|
4,253
|
|
2007
|
|
July 2019
|
|
YM
Vancouver
|
4,253
|
|
2007
|
|
September
2019
|
|
Derby
D
|
4,253
|
|
2004
|
|
September
2017
|
|
Deva
|
4,253
|
|
2004
|
|
June 2017
|
|
ZIM Rio
Grande
|
4,253
|
|
2008
|
|
May 2020
|
|
ZIM Sao
Paolo
|
4,253
|
|
2008
|
|
August
2020
|
|
ZIM Kingston (ex
OOCL Istanbul)
|
4,253
|
|
2008
|
|
September
2020
|
|
ZIM
Monaco
|
4,253
|
|
2009
|
|
November
2020
|
|
ZIM Dalian (ex
OOCL Novorossiysk)
|
4,253
|
|
2009
|
|
February 2021
|
|
ZIM
Luanda
|
4,253
|
|
2009
|
|
May 2021
|
|
Dimitris
C
|
3,430
|
|
2001
|
|
February
2018
|
|
Express Black
Sea
|
3,400
|
|
2011
|
|
February
2018
|
|
Express
Spain
|
3,400
|
|
2011
|
|
June 2017
|
|
Express
Argentina
|
3,400
|
|
2010
|
|
June 2017
|
|
Express
Brazil
|
3,400
|
|
2010
|
|
June 2017
|
|
Express
France
|
3,400
|
|
2010
|
|
June 2017
|
|
Colombo
|
3,314
|
|
2004
|
|
March 2019
|
|
MSC
Zebra
|
2,602
|
|
2001
|
|
October
2017
|
|
Amalia
C
|
2,452
|
|
1998
|
|
June 2017
|
|
Danae
C
|
2,524
|
|
2001
|
|
June 2017
|
|
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
|
|
February
2018
|
|
Hyundai
Progress
|
2,200
|
|
1998
|
|
December
2017
|
|
Hyundai
Bridge
|
2,200
|
|
1998
|
|
January
2018
|
|
Hyundai
Highway
|
2,200
|
|
1998
|
|
January
2018
|
|
Vladivostok (ex
Hyundai Vladivostok)
|
2,200
|
|
1997
|
|
August
2017
|
|
|
|
|
|
|
|
|
NYK
Lodestar(3)
|
6,422
|
|
2001
|
|
September
2017
|
|
NYK
Leo(3)
|
6,422
|
|
2002
|
|
February
2019
|
|
Suez
Canal(3)
|
5,610
|
|
2002
|
|
July 2017
|
|
Genoa(3)
|
5,544
|
|
2002
|
|
June 2017
|
|
|
|
|
|
|
|
|
|
|
(1)
|
Earliest date
charters could expire. Some charters include options to extend
their terms.
|
(2)
|
The charters with
respect to the CMA CGM Moliere, the CMA CGM Musset,
the CMA CGM Nerval, the CMA CGM
Rabelais and the CMA CGM Racine include an option for
the charterer, CMA-CGM, to purchase the vessels eight years after
the commencement of the respective charters, which will fall in
September 2017, March 2018, May 2018, July 2018 and August 2018,
respectively, each for $78.0 million. Each such option is
exercisable 15 months in advance of these dates. None of these
options have been exercised to date.
|
(3)
|
Vessels acquired by
Gemini Shipholdings Corporation, in which Danaos holds a 49% equity
interest.
|
DANAOS
CORPORATION
Condensed
Statements of Income - Unaudited
(Expressed in
thousands of United States dollars, except per share
amounts)
|
|
|
|
Three months
ended
|
|
Three months
ended
|
March
31,
|
March
31,
|
|
|
2017
|
|
2016
|
|
|
|
|
|
OPERATING
REVENUES
|
$110,087
|
|
$137,474
|
|
|
|
|
|
OPERATING
EXPENSES
|
|
|
|
|
Vessel operating
expenses
|
(27,455)
|
|
(28,912)
|
|
Depreciation &
amortization
|
(30,592)
|
|
(33,082)
|
|
General &
administrative
|
(6,129)
|
|
(5,216)
|
|
Loss on sale of
vessels
|
-
|
|
(36)
|
|
Other operating
expenses
|
(3,839)
|
|
(3,450)
|
Income From
Operations
|
42,072
|
|
66,778
|
|
|
|
|
|
OTHER
INCOME/(EXPENSES)
|
|
|
|
|
Interest
income
|
1,471
|
|
950
|
|
Interest
expense
|
(20,900)
|
|
(20,158)
|
|
Other finance
expenses
|
(1,047)
|
|
(1,127)
|
|
Equity income/(loss)
on investments
|
206
|
|
(723)
|
|
Other
income/(expenses), net
|
(2,448)
|
|
423
|
|
Realized loss on
derivatives
|
(911)
|
|
(3,140)
|
|
Unrealized gain on
derivatives
|
-
|
|
1,118
|
Total Other
Expenses, net
|
(23,629)
|
|
(22,657)
|
|
|
|
|
|
Net
Income
|
$18,443
|
|
$44,121
|
|
|
|
|
|
EARNINGS PER
SHARE
|
|
|
|
Basic & diluted
earnings per share
|
$0.17
|
|
$0.40
|
Basic & diluted
weighted average number of common shares
(in thousands of shares)
|
109,825
|
|
109,800
|
Non-GAAP
Measures*
Reconciliation of
Net Income to Adjusted Net Income – Unaudited
|
|
|
Three months
ended
|
|
Three months
ended
|
March
31,
|
March
31,
|
|
2017
|
|
2016
|
Net income
|
$18,443
|
|
$44,121
|
Unrealized gain on
derivatives
|
-
|
|
(1,118)
|
Amortization of
financing fees & finance fees accrued
|
3,722
|
|
4,189
|
Loss on sale of
securities
|
2,357
|
|
-
|
Loss on sale of
vessels
|
-
|
|
36
|
Adjusted Net
Income
|
$24,522
|
|
$47,228
|
Adjusted Earnings
Per Share
|
$0.22
|
|
$0.43
|
Weighted average
number of shares (in thousands)
|
109,825
|
|
109,800
|
|
* The Company reports
its financial results in accordance with U.S. generally accepted
accounting principles (GAAP). However, management believes that
certain non-GAAP financial measures used in managing the business
may provide users of this financial information additional
meaningful comparisons between current results and results in prior
operating periods. Management believes that these non-GAAP
financial measures can provide additional meaningful reflection of
underlying trends of the business because they provide a comparison
of historical information that excludes certain items that impact
the overall comparability. Management also uses these non-GAAP
financial measures in making financial, operating and planning
decisions and in evaluating the Company's performance. See the
Table above for supplemental financial data and corresponding
reconciliations to GAAP financial measures for the three months
ended March 31, 2017 and 2016. 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 Balance
Sheets - Unaudited
(Expressed in
thousands of United States dollars)
|
|
|
|
|
As
of
|
|
As
of
|
March
31,
|
December
31,
|
|
|
|
2017
|
|
2016
|
ASSETS
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$65,377
|
|
$73,717
|
|
Restricted
cash
|
|
-
|
|
2,812
|
|
Accounts receivable,
net
|
|
9,358
|
|
8,028
|
|
Other current
assets
|
|
56,800
|
|
51,397
|
|
|
|
131,535
|
|
135,954
|
NON-CURRENT
ASSETS
|
|
|
|
|
|
Fixed assets,
net
|
|
2,880,385
|
|
2,906,721
|
|
Deferred charges,
net
|
|
10,552
|
|
8,199
|
|
Investments in
affiliates
|
|
5,239
|
|
5,033
|
|
Other non-current
assets
|
|
29,388
|
|
71,157
|
|
|
|
2,925,564
|
|
2,991,110
|
TOTAL
ASSETS
|
|
$3,057,099
|
|
$3,127,064
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
|
Long-term debt,
current portion
|
|
$2,454,696
|
|
$2,504,932
|
|
Accounts payable,
accrued liabilities & other current liabilities
|
|
60,369
|
|
61,349
|
|
|
|
2,515,065
|
|
2,566,281
|
LONG-TERM
LIABILITIES
|
|
|
|
|
|
Other long-term
liabilities
|
|
68,766
|
|
73,070
|
|
|
|
68,766
|
|
73,070
|
|
|
|
|
|
|
STOCKHOLDERS'
EQUITY
|
|
|
|
|
|
Common
stock
|
|
1,098
|
|
1,098
|
|
Additional paid-in
capital
|
|
546,898
|
|
546,898
|
|
Accumulated other
comprehensive loss
|
|
(124,051)
|
|
(91,163)
|
|
Retained
earnings
|
|
49,323
|
|
30,880
|
|
|
|
473,268
|
|
487,713
|
Total liabilities
and stockholders' equity
|
|
$3,057,099
|
|
$3,127,064
|
DANAOS
CORPORATION
Condensed
Statements of Cash Flows - Unaudited
(Expressed in
thousands of United States dollars)
|
|
|
|
Three months
ended
|
|
Three months
ended
|
March
31,
|
March
31,
|
|
|
2017
|
|
2016
|
Operating
Activities:
|
|
|
|
|
Net income
|
$18,443
|
|
$44,121
|
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
Depreciation
|
28,851
|
|
32,047
|
|
Amortization of
deferred drydocking & special survey costs, finance cost
and
other finance fees accrued
|
5,463
|
|
5,224
|
|
Payments for
drydocking/special survey
|
(4,094)
|
|
(3,118)
|
|
Amortization of
deferred realized losses on cash flow interest rate
swaps
|
911
|
|
1,002
|
|
Equity (income)/loss
on investments
|
(206)
|
|
723
|
|
Unrealized gain on
derivatives
|
-
|
|
(1,118)
|
|
Loss on sale of
securities
|
2,357
|
|
-
|
|
Loss on sale of
vessels
|
-
|
|
36
|
|
Accounts
receivable
|
(1,330)
|
|
(4,626)
|
|
Other assets, current
and non-current
|
210
|
|
(14,408)
|
|
Accounts payable and
accrued liabilities
|
2,042
|
|
2,400
|
|
Other liabilities,
current and long-term
|
(8,314)
|
|
(879)
|
Net Cash provided
by Operating Activities
|
44,333
|
|
61,404
|
|
|
|
|
|
Investing
Activities:
|
|
|
|
|
Vessel additions and
vessel acquisitions
|
(1,527)
|
|
(377)
|
|
Investments in
affiliates
|
-
|
|
(1,470)
|
|
Net proceeds from
sale of vessels
|
-
|
|
5,178
|
Net Cash provided
by/(used in) Investing Activities
|
(1,527)
|
|
3,331
|
|
|
|
|
|
Financing
Activities:
|
|
|
|
|
Debt
repayment
|
(53,958)
|
|
(49,158)
|
|
Decrease in
restricted cash
|
2,812
|
|
2,811
|
Net Cash used in
Financing Activities
|
(51,146)
|
|
(46,347)
|
Net
Increase/(Decrease) in cash and cash equivalents
|
(8,340)
|
|
18,388
|
Cash and cash
equivalents, beginning of period
|
73,717
|
|
72,253
|
Cash and cash
equivalents, end of period
|
$65,377
|
|
$90,641
|
DANAOS
CORPORATION
Reconciliation of
Net Income to Adjusted EBITDA
(Expressed in
thousands of United States dollars)
|
|
|
Three months
ended
|
|
Three months
ended
|
March
31,
|
March
31,
|
|
2017
|
|
2016
|
Net income
|
$18,443
|
|
$44,121
|
Depreciation
|
28,851
|
|
32,047
|
Amortization of
deferred drydocking & special survey costs
|
1,741
|
|
1,035
|
Amortization of
deferred finance costs and write-offs and other
finance fees accrued
|
3,722
|
|
4,189
|
Amortization of
deferred realized losses on interest rate swaps
|
911
|
|
1,002
|
Interest
income
|
(1,471)
|
|
(950)
|
Interest
expense
|
17,992
|
|
16,851
|
Loss on sale of
securities
|
2,357
|
|
-
|
Loss on sale of
vessels
|
-
|
|
36
|
Realized loss on
derivatives
|
-
|
|
2,138
|
Unrealized gain on
derivatives
|
-
|
|
(1,118)
|
Adjusted
EBITDA(1)
|
$72,546
|
|
$99,351
|
|
|
|
|
|
|
1)
|
Adjusted EBITDA
represents net income before interest income and expense,
depreciation, amortization of deferred drydocking & special
survey costs and deferred finance costs, amortization of deferred
realized losses on interest rate swaps, unrealized gain on
derivatives, realized loss on derivatives, loss on sale of
securities and a loss on 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 Adjusted EBITDA is useful in evaluating our operating
performance compared to that of other companies in our industry
because the calculation of Adjusted EBITDA generally eliminates the
effects of financings, income taxes and the accounting effects of
capital expenditures and acquisitions, items which may vary for
different companies for reasons unrelated to overall operating
performance. In evaluating Adjusted EBITDA, you should be aware
that in the future we may incur expenses that are the same as or
similar to some of the adjustments in this presentation. Our
presentation of Adjusted EBITDA should not be construed as an
inference that our future results will be unaffected by unusual or
non-recurring items.
|
|
|
|
Note: Items to
consider for comparability include gains and charges. Gains
positively impacting net income are reflected as deductions to net
income. Charges negatively impacting net income are reflected as
increases to net income.
|
|
|
|
The Company reports
its financial results in accordance with U.S. generally accepted
accounting principles (GAAP). However, management believes that
certain non-GAAP financial measures used in managing the business
may provide users of these financial information additional
meaningful comparisons between current results and results in prior
operating periods. Management believes that these non-GAAP
financial measures can provide additional meaningful reflection of
underlying trends of the business because they provide a comparison
of historical information that excludes certain items that impact
the overall comparability. Management also uses these non-GAAP
financial measures in making financial, operating and planning
decisions and in evaluating the Company's performance. See the
Tables above for supplemental financial data and corresponding
reconciliations to GAAP financial measures for the three months
ended March 31, 2017 and 2016. 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.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/danaos-corporation-reports-first-quarter-results-for-the-period-ended-march-31-2017-300465651.html
SOURCE Danaos Corporation