ATHENS, Greece, Feb. 12,
2018 /PRNewswire/ -- 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,
2017.
Highlights for the Fourth Quarter and Year Ended December 31, 2017:
- Adjusted net income1 of $31.2 million, or $0.28 per share, for the three months ended
December 31, 2017 compared to
$23.2 million, or $0.21 per share, for the three months ended
December 31, 2016, an increase of
34.5%. Adjusted net income1 of $114.9 million, or $1.05 per share, for the year ended December 31, 2017 compared to $140.9 million, or $1.28 per share, for the year ended December 31, 2016, a decrease of 18.5%.
- Operating revenues of $114.2
million for the three months ended December 31, 2017 compared to $112.1 million for the three months ended
December 31, 2016, an increase of
1.9%. Operating revenues of $451.7
million for the year ended December
31, 2017 compared to $498.3
million for the year ended December
31, 2016, a decrease of 9.4%.
- Adjusted EBITDA1 of $80.0 million for the three months ended
December 31, 2017 compared to
$75.9 million for the three months
ended December 31, 2016, an increase
of 5.4%. Adjusted EBITDA1 of $310.4 million for the year ended December 31, 2017 compared to $350.6 million for the year ended December 31, 2016, a decrease of 11.5%.
- Total contracted operating revenues were $1.7 billion as of December 31, 2017, with charters extending
through 2028 and remaining average contracted charter duration of
5.7 years, weighted by aggregate contracted charter hire.
- Charter coverage of 86% for the next 12 months based on
current operating revenues and 69% in terms of contracted operating
days.
|
Three Months and
Year Ended December 31, 2017
Financial Summary
- Unaudited
(Expressed
in thousands of United States dollars, except per share
amounts)
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Three months
ended
|
|
Year
ended
|
|
Year
ended
|
|
December
31,
|
December
31,
|
December
31,
|
December
31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
|
|
Operating
revenues
|
$114,168
|
|
$112,107
|
|
$451,731
|
|
$498,332
|
|
Net
income/(loss)
|
$22,806
|
|
$(446,567)
|
|
$83,905
|
|
$(366,195)
|
|
Adjusted net
income1
|
$31,231
|
|
$23,158
|
|
$114,881
|
|
$140,881
|
|
Earnings/(loss) per
share
|
$0.21
|
|
$(4.07)
|
|
$0.76
|
|
$(3.34)
|
|
Adjusted earnings per
share1
|
$0.28
|
|
$0.21
|
|
$1.05
|
|
$1.28
|
|
Weighted average
number of shares (in thousands)
|
109,821
|
|
109,805
|
|
109,824
|
|
109,802
|
|
Adjusted
EBITDA1
|
$80,016
|
|
$75,874
|
|
$310,378
|
|
$350,587
|
Danaos' CEO Dr. John Coustas
commented:
Our earnings for the fourth quarter of 2017 improved markedly
when compared to the earnings of the fourth quarter of 2016 which
had been negatively impacted in the aftermath of the Hanjin
bankruptcy. This is mainly the result of our high charter contract
coverage which remains at 86% for the next 12 months based on
current operating revenues and 69% in terms of contracted operating
days.
Adjusted net income of $31.2
million for the quarter represented an increase of
$8.0 million, or 34.5%, compared to
$23.2 million for the fourth quarter
of 2016. This increase was attributable to a $5.2 million increase in the operating revenues
of the vessels that were previously chartered to Hanjin compared to
the fourth quarter of 2016, and improved operating performance of
$2.8 million.
As previously reported, the Company is in breach of certain
financial covenants as a result of the Hanjin bankruptcy. We are
currently engaged in discussions with our lenders regarding
restructuring our debt, substantially all of which matures on
December 31, 2018. In the meantime,
we continue to generate positive cash flows from our operations and
currently have sufficient liquidity to service all our operational
obligations as well as all scheduled principal amortization and
interest payments under the original terms of our debt agreements
leading up to the December 2018
maturity date.
The charter market in general has stabilized at slightly better
levels compared to the lows of 2016. However, although the size
segment above 10,000 TEU has recently seen some improvement, the
size segment between 5,000 to 10,000 TEU has retracted from the
charter rate levels achieved within 2017. For panamax vessels
between 4,000 to 5,000 TEU the market is stagnant however
comfortably above operating costs. For the smaller feeder sector
there is a firming market however the lack of long term fixtures
shows that there is no faith in the sustainability. We do not
expect a material improvement in the market environment within
2018, given the large number of scheduled vessel deliveries. Danaos
continues to have low near term exposure to the weak spot market as
a result of the aforementioned charter coverage.
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.
Three months ended December 31,
2017 compared to the three months ended December 31, 2016
During the three months ended December
31, 2017 and December 31,
2016, Danaos had an average of 55 containerships. Our fleet
utilization for the fourth quarter of 2017 was 97.8%, while fleet
utilization for the vessels under employment, excluding the off
charter days of the vessels that were previously chartered to
Hanjin Shipping ("Hanjin"), was 97.8% in the three months ended
December 31, 2017 compared to 99.5%
in the three months ended December 31,
2016.
Our adjusted net income amounted to $31.2
million, or $0.28 per share,
for the three months ended December 31,
2017 compared to $23.2
million, or $0.21 per share,
for the three months ended December 31,
2016. We have adjusted our net income in the three months
ended December 31, 2017 for
refinancing related professional fees of $5.0 million and a non-cash amortization charge
of $3.4 million for fees related to
our 2011 comprehensive financing plan (comprised of non-cash,
amortizing and accrued finance fees). Please refer to the Adjusted
Net Income reconciliation table, which appears later in this
earnings release.
The increase of $8.0 million in
adjusted net income for the three months ended December 31, 2017 compared to the three months
ended December 31, 2016 is
attributable to a $2.1 million
increase in operating revenues, a $5.1
million decrease in total operating expenses, a $1.0 million decrease in realized loss on
derivatives, a $0.5 million increase
in other income and a $0.3 million
improvement in the operating performance of our equity investment
in Gemini Shipholdings Corporation ("Gemini"), which were partially
offset by a $1.0 million increase in
net finance expenses.
On a non-adjusted basis, our net income amounted to $22.8 million, or $0.21 per share, for the three months ended
December 31, 2017 compared to a loss
of $446.6 million, or $4.07 loss per share, for the three months ended
December 31, 2016, which includes
$466.9 million of impairment related
expenses.
Operating Revenues
Operating revenues increased by
1.9%, or $2.1 million, to
$114.2 million in the three months
ended December 31, 2017 from
$112.1 million in the three months
ended December 31, 2016.
Operating revenues for the three months ended December 31, 2017 reflect:
- $5.2 million increase in revenues
in the three months ended December 31,
2017 compared to the three months ended December 31, 2016 due to the recorded charter
income of $6.7 million from eight of
our vessels previously chartered to Hanjin Shipping ("Hanjin") that
had recorded operating revenues of $1.5
million during the fourth quarter of 2016.
- $2.7 million decrease in revenues
in the three months ended December 31,
2017 compared to the three months ended December 31, 2016 due to the re-chartering of
certain of our vessels at lower rates.
- $0.4 million decrease in revenues
attributed to fleet utilization in the three months ended
December 31, 2017 compared to the
three months ended December 31,
2016.
Vessel Operating Expenses
Vessel operating expenses
increased by 1.2%, or $0.3 million,
to $26.2 million in the three
months ended December 31, 2017 from
$25.9 million in the three months
ended December 31, 2016. The average
daily operating cost per vessel for vessels on time charter was
$5,583 per day for the three months
ended December 31, 2017 compared to
$5,303 per day for the three months
ended December 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 13.8%,
or $4.5 million, to $28.0 million in the three months ended
December 31, 2017 from $32.5 million in the three months ended
December 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 $0.1
million, to $1.7 million in
the three months ended December 31,
2017 from $1.6 million in the
three months ended December 31,
2016.
General and Administrative Expenses
General and
administrative expenses decreased by $0.2
million to $5.8 million in the
three months ended December 31, 2017,
from $6.0 million in the three months
ended December 31, 2016.
Other Operating Expenses
Other Operating Expenses
include Voyage Expenses.
Voyage Expenses
Voyage expenses decreased by
$0.9 million to $3.0 million in the three months ended
December 31, 2017 compared to
$3.9 million in the three months
ended December 31, 2016. The decrease
is mainly due to decreased bunkering expenses.
Impairment Loss
We have recognized an impairment loss
of $415.1 million in relation to 25
of our vessels as of December 31,
2016 compared to nil in the three months ended December 31, 2017.
Interest Expense and Interest Income
Interest expense
increased by 4.7%, or $1.0 million,
to $22.2 million in the three
months ended December 31, 2017 from
$21.2 million in the three months
ended December 31, 2016. The increase
in interest expense was mainly due to the increase in average cost
of debt due to the increase in US$ Libor by about 50 bps between
the two periods, which was partially offset by a decrease in our
average debt by $212.3 million, to
$2,340.8 million in the three months
ended December 31, 2017, from
$2,553.1 million in the three months
ended December 31, 2016 and a
$0.4 million decrease in the
amortization of deferred finance costs.
As of December 31, 2017, the debt
outstanding gross of deferred finance costs was $2,340.8 million compared to $2,527.3 million as of December 31, 2016.
Interest income decreased by $0.1
million, to $1.4 million in
the three months ended December 31,
2017 from $1.5 million in the
three months ended December 31,
2016.
Other Finance Expenses, net
Other finance expenses,
net decreased by $0.6 million, to
$1.0 million in the three months
ended December 31, 2017 from
$1.6 million in the three months
ended December 31, 2016.
Equity Income/(Loss) on Investments
Equity income on
investments amounted to $0.3 million
in the three months ended December 31,
2017 compared to the equity loss on investments of
$14.6 million (mainly attributed to
our share of impairment loss for Gemini vessels) in the three
months ended December 31, 2016 and
relates to the improved operating performance of Gemini, in which
the Company has a 49% shareholding interest.
Unrealized Loss on Derivatives
Unrealized loss on
interest rate swaps amounted to nil in the three months ended
December 31, 2017 compared to an
unrealized loss of $6.8 million in
the three months ended December 31,
2016. The unrealized loss in the three months ended
December 31, 2016 was mainly
attributed to the accelerated amortization of accumulated other
comprehensive loss of $7.7
million.
Realized Loss on Derivatives
Realized loss on interest
rate swaps decreased to $0.9 million
in the three months ended December 31,
2017 from a loss of $1.9
million in the three months ended December 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 expenses, net
amounted to $4.3 million and related
mainly to the professional fees of $5.0
million due to refinancing discussions with our lenders in
the three months ended December 31,
2017 compared to other expenses, net of $29.2 million incurred mainly due to a
$29.4 million impairment loss on Zim
equity and debt securities recognized in the three months ended
December 31, 2016.
Adjusted EBITDA
Adjusted EBITDA increased by 5.4%, or
$4.1 million, to $80.0 million in the three months ended
December 31, 2017 from $75.9 million in the three months ended
December 31, 2016. As outlined
earlier, this increase is attributable to a $2.1 million increase in operating revenues, by a
$0.7 million decrease in operating
expenses, a $0.3 million operating
performance improvement on equity investments and a $1.0 million decrease in other expenses. Adjusted
EBITDA for the three months ended December
31, 2017 is adjusted for refinancing professional fees of
$5.0 million. Tables reconciling
Adjusted EBITDA to Net Income can be found at the end of this
earnings release.
Year ended December 31, 2017
compared to the year ended December 31,
2016
During the year ended December 31,
2017 and December 31, 2016,
Danaos had an average of 55 containerships. Our fleet utilization
in the year ended December 31, 2017
was 96.4%, while fleet utilization for the vessels under
employment, excluding the off charter days of the vessels that were
previously chartered to Hanjin, increased to 97.9% in the year
ended December 31, 2017 compared to
97.3% in the year ended December 31,
2016.
Our adjusted net income amounted to $114.9 million, or $1.05 per share, for the year ended December 31, 2017 compared to $140.9 million, or $1.28 per share, for the year ended December 31, 2016. We have adjusted our net
income in the year ended December 31,
2017 for refinancing related professional fees of
$14.3 million, a non-cash
amortization charge of $14.3 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 $26.0 million in
adjusted net income for the year ended December 31, 2017 compared to the year ended
December 31, 2016 is attributable to
a $41.3 million decrease in operating
revenues during the first half of the year as a result of the
Hanjin bankruptcy partially offset by $11.2
million increase in operating revenues earned by the ex
Hanjin vessels that earned operating revenues of $1.5 million during the second half of 2016, a
decline in operating revenues of $15.5
million as a result of weaker charter market conditions that
were prevailing when expiring charters were entered into, and a
$1.0 million decrease in operating
revenues attributed to fleet utilization, which were partially
offset by a $15.8 million decrease in
total operating expenses, a $2.0
million decrease in net finance expenses mainly due to
interest rate swap expirations and increased interest income, a
$2.6 million improvement in the
operating performance of our equity investment in Gemini and a
$0.2 million increase in other
income.
On a non-adjusted basis, our net income amounted to $83.9 million, or $0.76 per share, for the year ended December 31, 2017 compared to net loss of
$366.2 million, or $3.34 loss per share, for the year ended
December 31, 2016, which includes
$466.9 million of impairment related
expenses.
Operating Revenues
Operating revenues decreased by
9.4%, or $46.6 million, to
$451.7 million in the year ended
December 31, 2017 from $498.3 million in the year ended December 31, 2016.
Operating revenues for the year ended December 31, 2017 reflect:
- $41.3 million decrease in
revenues during the first half of the year due to loss of revenue
from cancelled charters with Hanjin for eight of our vessels due to
Hanjin's bankruptcy. These vessels were re-chartered at lower rates
and in some cases experienced off hire time in the 2017
period.
- $11.2 million increase in
revenues during the second half of 2017 due to the recorded charter
income of $12.7 million from eight of
our vessels previously chartered to Hanjin that earned operating
revenues of $1.5 million during the
second half of 2016.
- $15.5 million decrease in
revenues in the year ended December 31,
2017 compared to the year ended December 31, 2016 due to the re-chartering of
certain of our vessels at lower rates.
- $1.0 million decrease in revenues
due to lower fleet utilization in the year ended December 31, 2017 compared to the year ended
December 31, 2016.
Vessel Operating Expenses
Vessel operating expenses
decreased by 2.2%, or $2.4 million,
to $107.0 million in the year
ended December 31, 2017 from
$109.4 million in the year ended
December 31, 2016. The average daily
operating cost per vessel for vessels on time charter was
$5,661 per day for the year ended
December 31, 2017 compared to
$5,637 per day for the year ended
December 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 10.7%,
or $13.8 million, to $115.2 million in the year ended December 31, 2017 from $129.0 million in the year ended December 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 $1.2
million, to $6.7 million in
the year ended December 31, 2017 from
$5.5 million in the year ended
December 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 $0.6
million, to $22.7 million in
the year ended December 31, 2017,
from $22.1 million in the year ended
December 31, 2016.
Other Operating Expenses
Other Operating Expenses
include Voyage Expenses and Bad Debt Expense.
Voyage Expenses
Voyage expenses decreased by
$1.3 million to $12.6 million in the year ended December 31, 2017 compared to $13.9 million in the year ended December 31, 2016. The decrease is mainly due to
decreased commissions.
Bad Debt Expense
Bad debt expense of $15.8 million in the year ended December 31, 2016 compared to nil in the year
ended December 31, 2017 relates to
receivables from Hanjin, which were written-off.
Impairment Loss
We have recognized an impairment loss
of $415.1 million in relation to 25
of our vessels as of December 31,
2016 compared to nil in the year ended December 31, 2017.
Interest Expense and Interest Income
Interest expense
increased by 4.3%, or $3.6 million,
to $86.6 million in the year
ended December 31, 2017 from
$83.0 million in the year ended
December 31, 2016. The increase in
interest expense was mainly due to the increase in average cost of
debt due to the increase in US$ Libor by about 50 bps between the
two periods, which was partially offset by a decrease in our
average debt by $243.1 million, to
$2,409.1 million in the year ended
December 31, 2017, from $2,652.2 million in the year ended December 31, 2016 and a $1.8 million decrease in the amortization of
deferred finance costs.
As of December 31, 2017, the debt
outstanding gross of deferred finance costs was $2,340.8 million compared to $2,527.3 million as of December 31, 2016.
Interest income increased by $0.9
million to $5.6 million in the
year ended December 31, 2017 compared
to $4.7 million in the year ended
December 31, 2016. The increase was
mainly attributed to the interest income recognized on HMM notes
receivable.
Other Finance Expenses, net
Other finance expenses,
net decreased by $0.8 million, to
$4.1 million in the year ended
December 31, 2017 from $4.9 million in the year ended December 31, 2016.
Equity Income/(Loss) on Investments
Equity income on
investments amounted to $1.0 million
in the year ended December 31, 2017
compared to the equity loss on investments of $16.2 million (mainly attributed to our share of
impairment loss for Gemini vessels amounting to $14.6 million) in the year ended December 31, 2016 and relates to the improved
operating performance of Gemini, in which the Company has a 49%
shareholding interest.
Unrealized Loss on Derivatives
Unrealized loss on
interest rate swaps amounted to nil in the year ended December 31, 2017 compared to a loss of
$3.1 million in the year ended
December 31, 2016. The unrealized
loss in the year ended December 31,
2016 was attributable to the accelerated amortization of
accumulated other comprehensive loss of $7.7
million, which was partially offset by the unrealized gains
of $4.6 million 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 $3.7 million
in the year ended December 31, 2017
from a loss of $9.4 million in the
year ended December 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 expenses, net
amounted to $15.8 million related
mainly to a $14.3 million increase in
professional fees due to the refinancing discussions with our
lenders and a $2.4 million realized
loss on sale of HMM securities in the year ended December 31, 2017 compared to other expenses, net
of $41.6 million mainly due to a
$29.4 million impairment loss in Zim
equity and debt securities and a $12.9
million loss on sale of HMM equity securities recognized in
the year ended December 31, 2016.
Adjusted EBITDA
Adjusted EBITDA decreased by 11.5%, or
$40.2 million, to $310.4 million in the year ended
December 31, 2017 from $350.6 million in the year ended December 31, 2016. As outlined earlier, this
decrease is mainly attributable to a $46.6
million decrease in operating revenues, which was partially
offset by a $3.1 million decrease in
operating expenses, a $2.6 million
operating performance improvement on equity investments, and a
$0.7 million decrease in other
expenses. Adjusted EBITDA for the year ended December 31, 2017 is adjusted for refinancing
related professional fees of $14.3
million and 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.
Credit Facilities
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 December 31, 2017 and December 31, 2016. We are currently in
discussions with our lenders regarding our non-compliance with
these covenants and restructuring our debt, which substantially
exceeds the market value of our fleet and matures in December 2018. Accordingly, we will need to reach
an agreement with our lenders by December
31, 2018.
Conference Call and Webcast
On Tuesday, February 13, 2018 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 20, 2018 by dialing 1
877 344 7529 (US Toll Free Dial In) or +1 412 317 0088 (Standard
International Dial In) and using 10117035# 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
351,614 TEUs, including four vessels owned by Gemini Shipholdings
Corporation, a joint venture, ranks Danaos among the largest
containership charter owners in the world based on total TEU
capacity. Our fleet is chartered to many of the world's largest
liner companies on fixed-rate charters. Our long track record of
success is predicated on our efficient and rigorous operational
standards and environmental controls. Danaos Corporation's shares
trade on the New York Stock Exchange under the symbol "DAC".
Forward-Looking Statements
Matters discussed in this
release may constitute forward-looking statements within the
meaning of the 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, drydocking and insurance costs,
ability to obtain financing, including to reach an agreement with
our lenders regarding the restructuring of our debt maturing in
December 2018, 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 99 unscheduled off-hire days in the three months
ended December 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
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
|
|
|
2017
|
2017
|
|
2017
|
|
2017
|
|
Total
|
|
Ownership
Days
|
4,950
|
|
5,005
|
|
5,060
|
|
5,060
|
|
20,075
|
|
Less Off-hire
Days:
|
|
|
|
|
|
|
|
|
|
|
Scheduled Off-hire
Days
|
(15)
|
|
(6)
|
|
(15)
|
|
(10)
|
|
(46)
|
|
Other Off-hire
Days
|
(347)
|
|
(99)
|
|
(139)
|
|
(99)
|
|
(684)
|
|
Operating
Days
|
4,588
|
|
4,900
|
|
4,906
|
|
4,951
|
|
19,345
|
|
Vessel
Utilization
|
92.7%
|
|
97.9%
|
|
97.0%
|
|
97.8%
|
|
96.4%
|
|
|
|
|
|
|
|
|
|
|
|
Operating Revenues
(in '000s of US Dollars)
|
$110,087
|
|
$113,888
|
|
$113,588
|
|
$114,168
|
|
$451,731
|
|
Average Gross
Daily Charter Rate
|
$23,995
|
|
$23,242
|
|
$23,153
|
|
$23,060
|
|
$23,351
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Vessel Utilization
(No. of Days)
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
|
|
|
2016
|
2016
|
|
2016
|
|
2016
|
|
Total
|
|
Ownership
Days
|
5,013
|
|
5,005
|
|
5,060
|
|
5,060
|
|
20,138
|
|
Less Off-hire
Days:
|
|
|
|
|
|
|
|
|
|
|
Scheduled Off-hire
Days
|
(31)
|
|
(45)
|
|
-
|
|
-
|
|
(76)
|
|
Other Off-hire
Days
|
(242)
|
|
(110)
|
|
(169)
|
|
(484)
|
|
(1,005)
|
|
Operating
Days
|
4,740
|
|
4,850
|
|
4,891
|
|
4,576
|
|
19,057
|
|
Vessel
Utilization
|
94.6%
|
|
96.9%
|
|
96.7%
|
|
90.4%
|
|
94.6%
|
|
|
|
|
|
|
|
|
|
|
|
Operating Revenues
(in '000s of US Dollars)
|
$137,474
|
|
$136,999
|
|
$111,752
|
|
$112,107
|
|
$498,332
|
|
Average Gross
Daily Charter Rate
|
$29,003
|
|
$28,248
|
|
$22,848
|
|
$24,499
|
|
$26,150
|
Fleet List
The following table describes in detail our fleet deployment
profile as of February 12, 2018:
|
Vessel
Name
|
Vessel
Size
(TEU)
|
|
Year
Built
|
|
Expiration of
Charter(1)
|
|
|
Containerships
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
MSC Ambition (ex
Hyundai Ambition)
|
13,100
|
|
2012
|
|
June 2024
|
|
|
Maersk Exeter (ex
Hyundai Speed)
|
13,100
|
|
2012
|
|
June 2024
|
|
|
Maersk Enping (ex
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
|
|
January
2019
|
|
|
Express
Berlin
|
10,100
|
|
2011
|
|
September
2019
|
|
|
Express
Athens
|
10,100
|
|
2011
|
|
February
2019
|
|
|
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
|
|
March 2018
|
|
|
Europe
|
8,468
|
|
2004
|
|
March 2018
|
|
|
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
|
|
March 2018
|
|
|
YM
Seattle
|
4,253
|
|
2007
|
|
July 2019
|
|
|
YM
Vancouver
|
4,253
|
|
2007
|
|
September
2019
|
|
|
Derby
D
|
4,253
|
|
2004
|
|
March 2018
|
|
|
Deva
|
4,253
|
|
2004
|
|
March 2018
|
|
|
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
|
|
March 2018
|
|
|
Express Black
Sea
|
3,400
|
|
2011
|
|
March 2018
|
|
|
Express
Spain
|
3,400
|
|
2011
|
|
November
2018
|
|
|
Express
Argentina
|
3,400
|
|
2010
|
|
March 2018
|
|
|
Express
Brazil
|
3,400
|
|
2010
|
|
September
2018
|
|
|
Express
France
|
3,400
|
|
2010
|
|
October
2018
|
|
|
Singapore (ex YM
Singapore)
|
3,314
|
|
2004
|
|
October
2019
|
|
|
Colombo
|
3,314
|
|
2004
|
|
March 2019
|
|
|
MSC
Zebra
|
2,602
|
|
2001
|
|
October
2018
|
|
|
Amalia
C
|
2,452
|
|
1998
|
|
August
2019
|
|
|
Danae
C
|
2,524
|
|
2001
|
|
January
2020
|
|
|
Advance (ex
Hyundai Advance)
|
2,200
|
|
1997
|
|
June 2018
|
|
|
Future (ex Hyundai
Future)
|
2,200
|
|
1997
|
|
March 2018
|
|
|
Sprinter (ex
Hyundai Sprinter)
|
2,200
|
|
1997
|
|
February
2018
|
|
|
Stride (ex Hyundai
Stride)
|
2,200
|
|
1997
|
|
March 2018
|
|
|
Hyundai
Progress
|
2,200
|
|
1998
|
|
March 2018
|
|
|
Bridge (ex Hyundai
Bridge)
|
2,200
|
|
1998
|
|
July 2018
|
|
|
Hyundai
Highway
|
2,200
|
|
1998
|
|
February
2018
|
|
|
Vladivostok (ex
Hyundai Vladivostok)
|
2,200
|
|
1997
|
|
April 2018
|
|
|
|
|
|
|
|
|
|
NYK
Lodestar(3)
|
6,422
|
|
2001
|
|
March 2018
|
|
|
NYK
Leo(3)
|
6,422
|
|
2002
|
|
February
2019
|
|
|
Suez
Canal(3)
|
5,610
|
|
2002
|
|
March 2018
|
|
|
Genoa(3)
|
5,544
|
|
2002
|
|
June 2018
|
|
|
|
|
|
|
|
|
|
(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 included an option for
the charterer, CMA-CGM, to purchase the vessels eight years after
the commencement of the respective charters, which fell/will fall
in September 2017, March 2018, May 2018, July 2018 and August 2018,
respectively, each for $78.0 million. Each such option was
exercisable 15 months in advance of these dates. None of these
options were exercised.
|
|
(3)
|
Vessels acquired by
Gemini Shipholdings Corporation, in which Danaos holds a 49% equity
interest.
|
|
DANAOS
CORPORATION
Condensed
Consolidated Statements of Operations - Unaudited
(Expressed in
thousands of United States dollars, except per share
amounts)
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Three months
ended
|
|
Year
ended
|
|
Year
ended
|
|
December
31,
|
December
31,
|
December
31,
|
December
31,
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
|
|
|
|
|
|
|
|
|
OPERATING
REVENUES
|
$114,168
|
|
$112,107
|
|
$451,731
|
|
$498,332
|
|
|
|
|
|
|
|
|
|
|
OPERATING
EXPENSES
|
|
|
|
|
|
|
|
|
Vessel operating
expenses
|
(26,196)
|
|
(25,856)
|
|
(106,999)
|
|
(109,384)
|
|
Depreciation &
amortization
|
(29,672)
|
|
(34,016)
|
|
(121,976)
|
|
(134,573)
|
|
Impairment
loss
|
-
|
|
(415,118)
|
|
-
|
|
(415,118)
|
|
General &
administrative
|
(5,815)
|
|
(5,968)
|
|
(22,672)
|
|
(22,105)
|
|
Loss on sale of
vessels
|
-
|
|
-
|
|
-
|
|
(36)
|
|
Other operating
expenses
|
(2,962)
|
|
(3,923)
|
|
(12,587)
|
|
(29,759)
|
|
Income From
Operations
|
49,523
|
|
(372,774)
|
|
187,497
|
|
(212,643)
|
|
|
|
|
|
|
|
|
|
|
OTHER
INCOME/(EXPENSES)
|
|
|
|
|
|
|
|
|
Interest
income
|
1,375
|
|
1,486
|
|
5,576
|
|
4,682
|
|
Interest
expense
|
(22,227)
|
|
(21,170)
|
|
(86,556)
|
|
(82,966)
|
|
Other finance
expenses
|
(997)
|
|
(1,585)
|
|
(4,126)
|
|
(4,932)
|
|
Equity income/(loss)
on investments
|
332
|
|
(14,655)
|
|
965
|
|
(16,252)
|
|
Other
income/(expenses), net
|
(4,269)
|
|
(29,178)
|
|
(15,757)
|
|
(41,602)
|
|
Realized loss on
derivatives
|
(931)
|
|
(1,915)
|
|
(3,694)
|
|
(9,425)
|
|
Unrealized loss on
derivatives
|
-
|
|
(6,776)
|
|
-
|
|
(3,057)
|
|
Total Other
Expenses, net
|
(26,717)
|
|
(73,793)
|
|
(103,592)
|
|
(153,552)
|
|
|
|
|
|
|
|
|
|
|
Net
Income/(Loss)
|
$22,806
|
|
$(446,567)
|
|
$83,905
|
|
$(366,195)
|
|
|
|
|
|
|
|
|
|
|
EARNINGS/(LOSS)
PER SHARE
|
|
|
|
|
|
|
|
|
Basic & diluted
earnings/(loss) per share
|
$0.21
|
|
$(4.07)
|
|
$0.76
|
|
$(3.34)
|
|
Basic & diluted
weighted average number of common
shares (in thousands of shares)
|
109,821
|
|
109,805
|
|
109,824
|
|
109,802
|
|
Non-GAAP
Measures*
Reconciliation of
Net Income/(Loss) to Adjusted Net Income – Unaudited
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Three months
ended
|
|
Year
ended
|
|
Year
ended
|
|
December
31,
|
December
31,
|
December
31,
|
December
31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Net
income/(loss)
|
$22,806
|
|
$(446,567)
|
|
$83,905
|
|
$(366,195)
|
|
Amortization of
financing fees & finance fees accrued
|
3,440
|
|
3,805
|
|
14,322
|
|
16,099
|
|
Refinancing
professional fees
|
4,985
|
|
-
|
|
14,297
|
|
-
|
|
Impairment
loss
|
-
|
|
415,118
|
|
-
|
|
415,118
|
|
Impairment loss on
securities
|
-
|
|
29,384
|
|
-
|
|
29,384
|
|
Impairment loss
component of equity loss on investments
|
-
|
|
14,642
|
|
-
|
|
14,642
|
|
Accelerated
amortization of accumulated other comprehensive loss
|
-
|
|
7,706
|
|
-
|
|
7,706
|
|
Bad debt
expense
|
-
|
|
-
|
|
-
|
|
15,834
|
|
Loss on sale of
securities
|
-
|
|
-
|
|
2,357
|
|
12,906
|
|
Unrealized gain on
derivatives
|
-
|
|
(930)
|
|
-
|
|
(4,649)
|
|
Loss on sale of
vessels
|
-
|
|
-
|
|
-
|
|
36
|
|
Adjusted Net
Income
|
$31,231
|
|
$23,158
|
|
$114,881
|
|
$140,881
|
|
Adjusted Earnings
Per Share
|
$0.28
|
|
$0.21
|
|
$1.05
|
|
$1.28
|
|
Weighted average
number of shares (in thousands)
|
109,821
|
|
109,805
|
|
109,824
|
|
109,802
|
|
* 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
years ended December 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
Consolidated Balance Sheets - Unaudited
(Expressed in
thousands of United States dollars)
|
|
|
|
|
|
|
|
|
|
As
of
|
|
As
of
|
|
December
31,
|
December
31,
|
|
|
|
2017
|
|
2016
|
|
ASSETS
|
|
|
|
|
|
CURRENT
ASSETS
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$66,895
|
|
$73,717
|
|
Restricted
cash
|
|
2,812
|
|
2,812
|
|
Accounts receivable,
net
|
|
6,502
|
|
8,028
|
|
Other current
assets
|
|
49,790
|
|
51,397
|
|
|
|
125,999
|
|
135,954
|
|
NON-CURRENT
ASSETS
|
|
|
|
|
|
Fixed assets,
net
|
|
2,795,971
|
|
2,906,721
|
|
Deferred charges,
net
|
|
8,962
|
|
8,199
|
|
Investments in
affiliates
|
|
5,998
|
|
5,033
|
|
Other non-current
assets
|
|
49,466
|
|
71,157
|
|
|
|
2,860,397
|
|
2,991,110
|
|
TOTAL
ASSETS
|
|
$2,986,396
|
|
$3,127,064
|
|
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
|
CURRENT
LIABILITIES
|
|
|
|
|
|
Long-term debt,
current portion
|
|
$2,329,601
|
|
$2,504,932
|
|
Accounts payable,
accrued liabilities & other current liabilities
|
50,238
|
|
61,349
|
|
|
|
2,379,839
|
|
2,566,281
|
|
LONG-TERM
LIABILITIES
|
|
|
|
|
|
Long-term debt,
net
|
|
-
|
|
-
|
|
Other long-term
liabilities
|
|
57,852
|
|
73,070
|
|
|
|
57,852
|
|
73,070
|
|
|
|
|
|
|
|
STOCKHOLDERS'
EQUITY
|
|
|
|
|
|
Common
stock
|
|
1,098
|
|
1,098
|
|
Additional paid-in
capital
|
|
546,898
|
|
546,898
|
|
Accumulated other
comprehensive loss
|
|
(114,076)
|
|
(91,163)
|
|
Retained
earnings
|
|
114,785
|
|
30,880
|
|
|
|
548,705
|
|
487,713
|
|
Total liabilities
and stockholders' equity
|
|
$2,986,396
|
|
$3,127,064
|
|
DANAOS
CORPORATION
Condensed
Consolidated Statements of Cash Flows
- Unaudited
(Expressed in
thousands of United States dollars)
|
|
|
|
|
|
|
|
|
|
|
|
Three
months ended
|
|
Three
months ended
|
|
Year
ended
|
|
Year
ended
|
|
December
31,
|
December
31,
|
December
31,
|
December
31,
|
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Operating
Activities:
|
|
|
|
|
|
|
|
|
Net
income/(loss)
|
$22,806
|
|
$(446,567)
|
|
$83,905
|
|
$(366,195)
|
|
Adjustments to
reconcile net income/(loss) to net cash
provided by operating activities:
|
|
|
|
|
|
|
|
|
Depreciation
|
27,961
|
|
32,459
|
|
115,228
|
|
129,045
|
|
Impairment
losses
|
-
|
|
444,502
|
|
-
|
|
444,502
|
|
Amortization of
deferred drydocking & special survey costs,
finance cost and other finance fees accrued
|
5,151
|
|
5,362
|
|
21,070
|
|
21,627
|
|
Payments for
drydocking/special survey
|
(1,103)
|
|
(189)
|
|
(7,511)
|
|
(8,976)
|
|
Amortization of
deferred realized losses on cash flow
interest rate swaps
|
931
|
|
8,718
|
|
3,694
|
|
11,734
|
|
Equity (income)/loss
on investments
|
(332)
|
|
14,655
|
|
(965)
|
|
16,252
|
|
Unrealized gain on
derivatives
|
-
|
|
(930)
|
|
-
|
|
(4,649)
|
|
Bad debt
expense
|
-
|
|
-
|
|
-
|
|
15,834
|
|
Loss on sale of
securities
|
-
|
|
-
|
|
2,357
|
|
12,906
|
|
Loss on sale of
vessels
|
-
|
|
-
|
|
-
|
|
36
|
|
Stock based
compensation
|
-
|
|
76
|
|
-
|
|
76
|
|
Accounts
receivable
|
541
|
|
(3,976)
|
|
(2,544)
|
|
(13,210)
|
|
Other assets, current
and non-current
|
(4,599)
|
|
(989)
|
|
(7,832)
|
|
(20,060)
|
|
Accounts payable and
accrued liabilities
|
(1,667)
|
|
(5,342)
|
|
(23)
|
|
1,067
|
|
Other liabilities,
current and long-term
|
(4,442)
|
|
(10,183)
|
|
(26,306)
|
|
21,978
|
|
Net Cash provided
by Operating Activities
|
45,247
|
|
37,596
|
|
181,073
|
|
261,967
|
|
|
|
|
|
|
|
|
|
|
Investing
Activities:
|
|
|
|
|
|
|
|
|
Vessel
additions
|
(782)
|
|
(1,053)
|
|
(4,478)
|
|
(4,561)
|
|
Investments in
affiliates
|
-
|
|
-
|
|
-
|
|
(9,996)
|
|
Net proceeds from
sale of securities
|
-
|
|
-
|
|
6,236
|
|
-
|
|
Net proceeds from
sale of vessels
|
-
|
|
-
|
|
-
|
|
5,178
|
|
Net Cash provided
by/(used in) Investing Activities
|
(782)
|
|
(1,053)
|
|
1,758
|
|
(9,379)
|
|
|
|
|
|
|
|
|
|
|
Financing
Activities:
|
|
|
|
|
|
|
|
|
Debt
repayment
|
(41,723)
|
|
(88,953)
|
|
(189,653)
|
|
(251,130)
|
|
(Increase)/Decrease
in restricted cash
|
(2,812)
|
|
(2,117)
|
|
0
|
|
6
|
|
Net Cash used in
Financing Activities
|
(44,535)
|
|
(91,070)
|
|
(189,653)
|
|
(251,124)
|
|
Net
Increase/(Decrease) in cash and cash equivalents
|
(70)
|
|
(54,527)
|
|
(6,822)
|
|
1,464
|
|
Cash and cash
equivalents, beginning of period/year
|
66,965
|
|
128,244
|
|
73,717
|
|
72,253
|
|
Cash and cash
equivalents, end of period/year
|
$66,895
|
|
$73,717
|
|
$66,895
|
|
$73,717
|
|
DANAOS
CORPORATION
Reconciliation of
Net Income/(Loss) to Adjusted EBITDA - Unaudited
(Expressed in
thousands of United States dollars)
|
|
|
|
|
|
|
|
|
|
Three months
ended
|
|
Three months
ended
|
|
Year
ended
|
|
Year
ended
|
|
December
31,
|
December
31,
|
December
31,
|
December
31,
|
|
2017
|
|
2016
|
|
2017
|
|
2016
|
|
Net
income/(loss)
|
$22,806
|
|
$(446,567)
|
|
$83,905
|
|
$(366,195)
|
|
Depreciation
|
27,961
|
|
32,459
|
|
115,228
|
|
129,045
|
|
Amortization of
deferred drydocking & special survey costs
|
1,711
|
|
1,557
|
|
6,748
|
|
5,528
|
|
Amortization of
deferred finance costs and other finance fees accrued
|
3,440
|
|
3,805
|
|
14,322
|
|
16,099
|
|
Amortization of
deferred realized losses on interest rate swaps
|
931
|
|
1,012
|
|
3,694
|
|
4,028
|
|
Interest
income
|
(1,375)
|
|
(1,486)
|
|
(5,576)
|
|
(4,682)
|
|
Interest
expense
|
19,557
|
|
18,195
|
|
75,403
|
|
70,314
|
|
Refinancing
professional fees
|
4,985
|
|
-
|
|
14,297
|
|
-
|
|
Impairment
loss
|
-
|
|
415,118
|
|
-
|
|
415,118
|
|
Impairment loss on
securities
|
-
|
|
29,384
|
|
-
|
|
29,384
|
|
Impairment loss
component of equity loss on investments
|
-
|
|
14,642
|
|
-
|
|
14,642
|
|
Accelerated
amortization of accumulated other comprehensive loss
|
-
|
|
7,706
|
|
-
|
|
7,706
|
|
Bad debt
expense
|
-
|
|
-
|
|
-
|
|
15,834
|
|
Loss on sale of
securities
|
-
|
|
-
|
|
2,357
|
|
12,906
|
|
Loss on sale of
vessels
|
-
|
|
-
|
|
-
|
|
36
|
|
Stock based
compensation
|
-
|
|
76
|
|
-
|
|
76
|
|
Realized loss on
derivatives
|
-
|
|
903
|
|
-
|
|
5,397
|
|
Unrealized gain on
derivatives
|
-
|
|
(930)
|
|
-
|
|
(4,649)
|
|
Adjusted
EBITDA(1)
|
$80,016
|
|
$75,874
|
|
$310,378
|
|
$350,587
|
|
1)
|
Adjusted EBITDA
represents net income/(loss) 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, accelerated amortization of
accumulated other comprehensive loss, unrealized gain on
derivatives, realized loss on derivatives, loss on sale of
securities, refinancing professional fees, loss on sale of vessels,
impairment losses, stock based compensation and bad debt expense.
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
years ended December 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.
|
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.
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SOURCE Danaos Corporation