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I think anyone who didn't buy in yesterday missed the boat.
Agreed, that and the trains. DAC and other shipping companies unload all of their cargo from ships on to trains...and it's increasing with every 18 Wheeler Trucker that sold their rig last year to pay off the mortgage and keep the house...Check out PWX, Providence & Worchester railroad...im the MOD for IHUB board there.
I think DAC will be in the same place DRYS was in a few months back when Kramer started talking about shipping industry on Mad Money. He said NAT was his pick and while NAT went up it was DRYS that pumped the double barrel flip from 5 to ten bucks a share in less than a month. TOPS and OCNF are another two in the sector...in fact TOPS is really nice now and under 1.50. Who didn't have the HO Train "TOPS" Boxcar anyhow....red white and blue...you can't get any more Normal Rockwell of a stock than TOPS....the greeks always seem to find a way to keep things going, they made it through the Roman and American Empire's past 2000 years in charge, so Zeus and Hera must be paying attention to things over there on some level...this is definately in the hands of God.
I think the shippers are one of the last cheap sectors around and big money is looking for something to buy...
This has to be the biggest break out in shipping....OCNF and DRYS are joining the fleet of shippers going up....this is incredible..I have never seen such a jump. Has anyone else here seen this in 35 years....I think we're heading towards a massive jump....DOW 12,000 by CHristmas FOLKS! DOW 12,000 by CHRISTMAS! DAC will be just like DRYS and jump to $12.00 and hover back down around $8.00 by Christmas as well.
Big day! Checkout my shippers board!
http://investorshub.advfn.com/boards/board.aspx?board_id=10890
The divi will be back next year. Just hold this guy or buy more.
Going to $10.00 a share just like Dryships did....watch and see.
We're ready to roll. This one is going up.
Great Q2 results. When the company gets back on its feet, we will have a us a multi-bagger!
DAC - Great long term NYSE stock! Back to $30 in 2-3 years. It's a 7 bagger from the current price!
Maybe I'll try to become a moderator here :) A king of an empty castle :)
They got rid of divident in order to get their credit lines partially paid off. Debt seems to be the only problem here. Once that is taken care of, there will be nothing left to hold the stock down.
No divi, the company is being bought out by Oceanfreight. Just my guess, but they are going to be bought or merge. Just like the school systems in New Jersey are finding, the Greek Shipping companies are going to need to consolodate upper level management and resources. So in essence the same command and control that is needed to operate a 40 vessel fleet is essentially the same needed to operate an 80 vessel fleet. The advents in communication technology over the past 5 years have drastically changed the dynamics of Maratime management...where we used to see tables of organization billeting and working with 2 admirals (Vice Presidents), 4 captains, 8 commanders, and 20 lieutenants, we will see a single VIce President no captains and 4 commanders leading 10 lieutenants, and the duty of petty officers significantly increased to fill the leadership voids and holes created by the decommissioning of unneeded and in the way senior executive officers. If only Washington DC could do that. Still that is my opinion. We had the same paradym occur when the steam engine replaced sails...we had a complete restructuring of the command structure.
Last I read, dividend was suspended. Financial audit problems due to inadequate cash reserves for loans(?). Wall street journal article came out on the 12th. 700 cargo vessels parked outside shanghi... price for shipping containers plummets from $1400 last year to somewhere around $150 currently.
My guess this stock will drop significantly. Even tho they have successfully renegotiated contracts for accepting new ships that all have long term contracts, there is still nothing to ship.
According to their last posting, about 12 ships will reach the end of their contracts either 2010 or 2011. No news on new contracts.
Hold if you have the stomach for it, but I would not buy right now.
This stock is tremendously unervalued, look at the figure:
Market Cap (intraday)5: 233.50M
Enterprise Value (21-Apr-09)3: 2.22B
Trailing P/E (ttm, intraday): 2.03
Forward P/E (fye 31-Dec-10) 1: 2.55
PEG Ratio (5 yr expected): 0.44
Price/Sales (ttm): 0.78
Price/Book (mrq): 1.07
Enterprise Value/Revenue (ttm)3: 7.43
Enterprise Value/EBITDA (ttm)3: 12.128
Strong revenues but discontinued dividend due to uncertainty
in the market and future shipping charters. Following report is long but worth reading for future investment and trading opportunities.
Cheers,
SJ
Press Release Source: Danaos Corporation
Danaos Corporation Reports Fourth Quarter and Full Year Results for the Year Ended December 31, 2008
Wednesday March 11, 4:05 pm ET
ATHENS, GREECE--(MARKET WIRE)--Mar 11, 2009 -- Danaos Corporation ("Danaos") (NYSE:DAC - News), a leading international owner of containerships, today reported unaudited results for the fourth quarter and the full year ended December 31, 2008.
Highlights for the Fourth Quarter and Full Year Ended December 31, 2008:
-- Net earnings on a comparable basis(1) from continuing operations of
$25.5 million or $0.47 per share and $118.7 million or $2.18 per share for
the quarter and the year ended December 31, 2008, respectively, compared to
$25.5 million or $0.47 per share and $107.2 million or $1.96 per share for
the respective periods of 2007.
-- Net earnings on a reported basis from continuing operations of $23.8
million or $0.44 per share and $117.1 million or $2.15 for the quarter and
the year ended December 31, 2008, respectively, compared to $44.6 million
or $0.82 per share and $123.1 million or $2.26 per share for the respective
periods of 2007.
-- Operating revenues from continuing operations of $78.7 million and
$298.9 million for the quarter and the year ended December 31, 2008,
respectively, compared to $71.3 million and $258.8 million for the
respective periods of 2007.
-- EBITDA on a comparable basis from continuing operations of $51.3
million and $208.2 million for the quarter and the year ended December 31,
2008, respectively, compared to $45.0 million and $171.0 million for the
respective periods of 2007. EBITDA on a reported basis from continuing
operations of $49.6 million and $206.6 million for the quarter and the year
ended December 31, 2008, respectively, compared to $64.1 million and $186.9
million for the respective periods of 2007.
-- Paid cash dividends of $0.465 per share on November 19, 2008, for the
third quarter of 2008 and suspended further dividend payments until the
board of directors, in consultation with management, determines that
economic conditions allow dividend payments to be resumed.
ADVERTISEMENT
(1) Adjusted for a non-recurring insurance expense of $1.6 million related to prior years and recorded in the fourth quarter of 2008 as well as a non-recurring gain of $19.1 million and $15.9 million in the fourth quarter and the full year of 2007, respectively, in relation to leasing arrangements for six vessels in our fleet.
Danaos' CEO Dr. John Coustas commented:
"Despite the dramatic disruptions in world trade and financial markets in the latter part of 2008, for the full year of 2008 Danaos achieved solid earnings and strong revenue growth. We report net earnings from continuing operations of $23.8 million or $0.44 per share and $117.1 million or $2.15 per share for the quarter and the year ended December 31, 2008, respectively. I find this performance highly satisfactory as it vindicates our long standing business model premises of cash flow and earnings stability. Even under these most unfavorable circumstances, when our customers are increasingly coming under pressure with regards to their own top line, we have managed to retain the vigor of our revenues.
"We have come to the end of a year where global demand has unexpectedly decreased dramatically following the virtual collapse of the banking system that began in September 2008. In this challenging environment, Danaos has successfully taken delivery of six new vessels in 2008 while at the same time sold five older vessels. We are now operating a fleet of 39 containerships and have an order book of 30 more.
"The drop in world consumption of durable and consumer goods has been dramatic and rapid. Unlike after the tragic events of 9/11, when world trade came to a near halt for nine-months before returning to normal activity levels, the present drop in global demand extends well beyond the borders of the United States. We now face a world wide crisis, fundamentally driven by the failure of the world banking system and, so far, the inability of the institutions, including governments, to introduce sufficient remedies to reverse the situation.
"Despite Danaos' satisfactory 2008 results, the extraordinary circumstances facing the world economy dictate that we take steps to prepare, to the extent possible, for a very challenging period of unknown duration."
1. Future revenues: We have arranged charters for all of our current and contracted vessels with some of the largest and most reliable counterparties in the shipping industry. Although the current economic situation is presenting everybody in our trade with new challenges, our chartering arrangements do not allow for unilateral modification of the prevailing terms.
We have recently arranged a one-year charter for our 4,250 TEU vessel which comes off charter in March at market rates. Following the liquidation of Senator Lines with which we had one 2,100 TEU vessel chartered until May 2010, we agreed the continuation of the charter with Hanjin Shipping, albeit at reduced rates. We have no further anticipated re-chartering until the second quarter of 2010.
2. New building program: We have 30 vessels on order, all of which are chartered at reasonable charter rates with some of the largest liner companies in the world. The abrupt decline in global demand has created a clear mismatch between demand for marine container transportation and the supply of containerships. In order to address both this oversupply and the timing of our funding requirements, we have, in cooperation with our charterers, successfully delayed the delivery, so far, of five new buildings, with aggregate remaining payments of approximately $422 million, for up to eight months while we are in the final stages of pushing back the delivery of five more new buildings, with aggregate remaining payments of approximately $386 million, for two to seven months. Thus, as of today we are expecting to take delivery of seven vessels during the current year, nine in 2010 and fourteen in 2011, with aggregate remaining payments of approximately $549 million, $823 million and $807 million, respectively.
3. Financing: During the first months of 2009 we signed a new $299 million loan facility with Deutsche Schiffsbank. This additional facility, together with the available undrawn capacity under our existing credit facilities and the cash expected to be generated by our operations, is expected to cover our 2009, and a portion of our 2010, funding requirements. We are currently in discussions to arrange additional financing for the unfunded part of our new building fleet and we believe that despite the challenging current credit conditions we will be able to obtain these additional funds in time to meet our commitments, also supported by the fact that all of our new buildings are already chartered for long term periods.
The recent drop in vessel values, as well as the unprecedented drop in interest rates which has resulted in negative valuation on our interest rate swaps, have affected our compliance with certain of our financial covenants. We have either received waivers or are in discussions with the lead arrangers under our credit facilities to receive waivers covering breaches of any financial covenants, including those relating to vessel value and minimum net worth, during 2008 and 2009, however, certain of these agreements have not yet been reduced to writing and remain subject to the requisite approval of the applicable lending syndicate.
4. Dividend payments: We are announcing that we are suspending dividend payments until such time as the board of directors, in consultation with management, determines that economic conditions allow cash dividend payments to be resumed.
We firmly believe that under these circumstances of revised world growth and world demand the most prudent policy, alongside the above mentioned measures, is to suspend our dividend payments in order to position the Company to take advantage of its strong cash flow and further strengthen its balance sheet. The Board believes this decision will enhance the Company's financial flexibility, by retaining more than $100 million in cash flow per annum that would have, at our prior dividend payment level, otherwise been devoted to dividends.
The decision of the Board also enjoys my strong support, as majority-owner, President and CEO of Danaos. Of the Company's 54.6 million outstanding shares of common stock, more than 80% are beneficially owned by officers or directors of the Company and I believe that the retention of such significant cash sends a strong message to the marketplace and other Danaos shareholders that management and the Board remain committed to delivering flexible and sound business decisions, as well as to a total return strategy, in a challenging economic environment.
Our consistent strategy at Danaos has been to maximize total returns to shareholders by, thus far, paying substantial dividends and pursuing highly accretive growth. The latest market turn calls for a modified approach, which we believe is appropriate for the goals we have set for Danaos.
Three months ended December 31, 2008 compared to the three months ended December 31, 2007
During the quarter ended December 31, 2008, Danaos had an average of 38.7 containerships as opposed to 36.1 containerships for the same period of 2007. During the fourth quarter, we acquired one vessel and we sold two vessels. Our fleet utilization was 98.5% in the fourth quarter of 2008.
Given the sale of our entire dry bulk fleet, completed 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 on a comparable basis remained stable at $25.5 million or $0.47 per share for each of the fourth quarter of 2008 and 2007, adjusted for a non-recurring insurance expense of $1.6 million related to prior years and recorded in the fourth quarter of 2008 as well as a non-recurring gain of $19.1 million in the fourth quarter of 2007 in relation to leasing arrangements. Our net income on a reported basis was $23.8 million or $0.44 per share for the fourth quarter of 2008, compared to $44.6 million or $0.82 per share for the fourth quarter of 2007, which represents a decrease of 46.6% or $20.8 million.
Operating Revenue
Operating revenue increased 10.4%, or $7.4 million, to $78.7 million in the quarter ended December 31, 2008, from $71.3 million in the quarter ended December 31, 2007. The increase was primarily attributable to the addition of six vessels to our fleet, as follows:
Vessel Size
Vessel Name (TEU) Date Delivered
----------- ------------------
Hyundai Progress 2,200 February 11, 2008
Hyundai Highway 2,200 March 18, 2008
Hyundai Bridge 2,200 March 20, 2008
Zim Rio Grande 4,253 July 4, 2008
Zim Sao Paolo 4,253 September 22, 2008
Zim Kingston 4,253 November 3, 2008
These additions to our fleet contributed revenues of $9.9 million during the three months ended December 31, 2008. In addition, two 2,200 TEU containerships, the Hyundai Future and the Hyundai Sprider, a 4,300 TEU containership, the YM Singapore and a 4,253 TEU containership the YM Vancouver, which were added to our fleet on October 2, 2007, October 15, 2007, October 9, 2007 and November 27, 2007, respectively, contributed incremental revenues of $1.8 million during the three months ended December 31, 2008 compared to the three months ended December 31, 2007. In addition, the Company sold five vessels as follows:
Vessel Size
Vessel Name (TEU) Date Sold
----------- -----------------
APL Belgium 5,506 January 15, 2008
Winterberg 3,101 January 25, 2008
Maersk Constantia 3,101 May 20, 2008
Asia Express 3,101 October 26, 2008
Sederberg 3,101 December 10, 2008
These vessel sales reduced operating revenue by $3.9 million for the three months ended December 31, 2008 compared to the contribution by such vessels to operating revenue in the three months ended December 31, 2007.
We also had a further decrease in revenues of $0.4 million attributable to more off-hire days, which was partially offset by the re-chartering of certain vessels at higher charter rates during the three months ended December 31, 2008 compared to the three months ended December 31, 2007.
Vessel Operating Expenses
Vessel operating expenses increased 26.8%, or $5.1 million, to $24.1 million in the quarter ended December 31, 2008, from $19.0 million in the quarter ended December 31, 2007. The increase was mainly due to the increase in the average number of our vessels in our fleet under time charter during the quarter ended December 31, 2008 compared to the quarter ended December 31, 2007.
Depreciation & Amortization
Depreciation & Amortization includes Depreciation and Amortization of Deferred Dry-docking and Special Survey Costs.
Depreciation
Depreciation expense increased 20.9%, or $2.4 million, to $13.9 million in the quarter ended December 31, 2008, from $11.5 million in the quarter ended December 31, 2007. The increase in depreciation expense was due to the increased average number of vessels in our fleet during the quarter ended December 31, 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 17.6%, or $0.3 million, to $2.0 million in the quarter ended December 31, 2008, from $1.7 million in the quarter ended December 31, 2007. The increase reflects higher drydocking costs incurred, which were subject to amortization during the three months ended December 31, 2008 as compared to the same period of 2007.
General and Administrative Expenses
General and administrative expenses increased 11.1%, or $0.3 million, to $3.0 million in the quarter ended December 31, 2008, from $2.7 million in the same quarter of 2007. The increase was primarily a result of increased fees of $0.2 million paid to our Manager in the fourth quarter of 2008 compared to the same period of 2007 due to the 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 three months ended December 31, 2008, reflects the sale of the Asia Express and the Sederberg resulting in an aggregate net gain of $2.0 million.
Other Operating Expenses
Other Operating Expenses include Voyage Expenses
Voyage Expenses Voyage expenses decreased 23.8% or $0.5 million, to $1.6 million in the quarter ended December 31, 2008, from $2.1 million for the quarter ended December 31, 2007.
Interest Expense and Interest Income
Interest expense increased 69.3%, or $5.2 million, to $12.7 million in the quarter ended December 31, 2008, from $7.5 million in the quarter ended December 31, 2007. The change in interest expense was due to the increase in our average debt by $833.3 million to $2,077.6 million in the quarter ended December 31, 2008, from $1,244.3 million in the quarter ended December 31, 2007. The financing of our extensive new-building program resulted in interest capitalization, rather than such interest being recognized as an expense, of $10.3 million for the quarter ended December 31, 2008 compared to $9.8 million of capitalized interest for the quarter ended December 31, 2007.
Interest income increased by $1.5 million, to $2.7 million in the quarter ended December 31, 2008, from $1.2 million in the quarter ended December 31, 2007. The increase in interest income is attributed to higher average cash deposits during the three months ended December 31, 2008 as opposed to the three months ended December 31, 2007, partially offset by lower interest rates.
The restricted cash is attributed to cash raised through our revolving credit facilities designated to finance certain of our new buildings and is gradually utilized to fund progress payments of these new buildings up to their deliveries through the second quarter of 2010.
Other income/(expenses), net
Other income/(expenses), net, increased by $(20.9) million, to $(1.8) million in the quarter ended December 31, 2008, from $19.1 million in the same quarter of 2007. The change in other income/(expenses) is mainly attributed to a non-recurring gain of $19.1 million related to our leasing arrangements of the CSCL Europe, the MSC Baltic, the Maersk Derby, the Maersk Deva, the CSCL Pusan and the CSCL Le Havre and their subsequent restructuring entered into in the fourth quarter of 2007. In addition, during the fourth quarter of 2008, we recorded a non-recurring expense of $1.6 million in relation to insurance cost for the years of 2006 and 2007, which have been recorded in 2008, reflecting the contribution of our insurer to the exposure of the International Group of Protection & Indemnity ("P&I") Clubs.
EBITDA
EBITDA on a comparable basis increased by $6.3 million, or 14.0%, to $51.3 million in the quarter ended December 31, 2008, from $45.0 million in the quarter ended December 31, 2007, adjusted for a non-recurring insurance expense of $1.6 million for prior years recorded in the fourth quarter of 2008 and a non-recurring gain of $19.1 million recorded in the fourth quarter of 2007 in relation to leasing arrangements. EBITDA on a reported basis decreased by $14.5 million, or 22.6%, to $49.6 million in the quarter ended December 31, 2008, from $64.1 million in the quarter ended December 31, 2007. A table reconciling EBITDA to net income can be found at the end of this earnings release.
Twelve months ended December 31, 2008 compared to the twelve months ended December 31, 2007
During the twelve months ended December 31, 2008, Danaos had an average of 37.7 containerships as opposed to 32.3 containerships for the same period of 2007. During the twelve months of 2008, we acquired six vessels and we sold five vessels. Our fleet utilization for the full year was 97.6%.
Given the sale of our entire dry bulk fleet, completed 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 on a comparable basis was $118.7 million or $2.18 per share for the twelve months ended December 31, 2008 compared to $107.2 million or $1.96 per share for the twelve months ended December 31, 2007, adjusted for a non-recurring insurance expense of $1.6 million for prior years recorded in 2008 and a non-recurring gain of $15.9 million in the twelve months of 2007 in relation to leasing arrangements. This represents an increase in comparable net income of 10.7% or $11.5 million. Our net income on a reported basis was $117.1 million or $2.15 per share for the twelve months ended December 31, 2008 compared to $123.1 million or $2.26 per share for the twelve months ended December 31, 2007, a decrease of 4.9% or $6.0 million. For the first three quarters, we paid a cumulative dividend of $76.1 million. We have suspended dividend payments until the board of directors, in consultation with management, determines that economic conditions allow dividend payments to be resumed.
Operating Revenue
Operating revenue increased 15.5%, or $40.1 million, to $298.9 million in the twelve months ended December 31, 2008, from $258.8 million in the twelve months ended December 31, 2007. The increase was primarily attributed to the addition of six vessels to our fleet, as follows:
Vessel Size
Vessel Name (TEU) Date Delivered
----------- ------------------
Hyundai Progress 2,200 February 11, 2008
Hyundai Highway 2,200 March 18, 2008
Hyundai Bridge 2,200 March 20, 2008
Zim Rio Grande 4,253 July 4, 2008
Zim Sao Paolo 4,253 September 22, 2008
Zim Kingston 4,253 November 3, 2008
These additions to our fleet contributed revenues of $22.0 million during the twelve months ended December 31, 2008. In addition, two 4,300 TEU containerships, the YM Colombo and the YM Singapore, five 2,200 TEU containerships, the Hyundai Vladivostok, the Hyundai Advance, the Hyundai Stride, Hyundai Future and Hyundai Sprinter and two 4,253 TEU containerships, the YM Seattle and the YM Vancouver, which were added to our fleet on March 12, 2007, on October 9, 2007, on July 23, 2007, on August 20, 2007, on September 5, 2007, October 2, 2007, October 15, 2007, September 10, 2007 and November 27, 2007, respectively, contributed incremental revenues of $44.5 million during the twelve months ended December 31, 2008 compared to the twelve months ended December 31, 2007. In addition since January 1, 2007, the Company sold eight vessels as follows:
Vessel Size
Vessel Name (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
Asia Express 3,101 October 26, 2008
Sederberg 3,101 December 10, 2008
These sales reduced operating revenue by $23.6 million for the twelve months ended December 31, 2008 compared to the contribution by such vessels to operating revenue in the prior year.
We also had a further decrease in revenues of $2.8 million attributable to more off-hire days and re-chartering of certain vessels at lower charter rates during the twelve months ended December 31, 2008 compared to the twelve months ended December 31, 2007.
Vessel Operating Expenses
Our daily operating expenses per vessel between the twelve month periods of 2007 and 2008 increased by 4.0%. The increase was mainly due to higher crew wages and total repair & maintenance costs.
Vessel operating expenses increased 35.8% or $23.5 million, to $89.2 million in the twelve months ended December 31, 2008, from $65.7 million in the twelve months ended December 31, 2007. The increase was mainly due to the increase in the average number of our vessels in our fleet under time charter during the twelve months ended December 31, 2008 compared to the twelve months ended December 31, 2007.
Depreciation & Amortization
Depreciation & Amortization includes Depreciation and Amortization of Deferred Dry-docking and Special Survey Costs.
Depreciation
Depreciation expense increased 25.6%, or $10.4 million, to $51.0 million in the twelve months ended December 31, 2008, from $40.6 million in the twelve months ended December 31, 2007. The increase in depreciation expense was due to the increased average number of vessels in our fleet during the twelve months ended December 31, 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 19.7%, or $1.2 million, to $7.3 million in the twelve months ended December 31, 2008, from $6.1 million in the twelve months ended December 31, 2007. The increase reflects higher dry-docking costs incurred, which were subject to amortization during the twelve months ended December 31, 2008 as compared to the same period of 2007.
General and Administrative Expenses
General and administrative expenses increased 16.0%, or $1.6 million, to $11.6 million in the twelve months ended December 31, 2008, from $10.0 million in the same period of 2007. The increase was primarily a result of increased fees of $1.2 million paid to our Manager in the twelve months ended December 31, 2008 compared to the same period of 2007, attributed to the 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 twelve months ended December 31, 2008, reflects the sale of the APL Belgium, the Winterberg, the Maersk Constantia, the Asia Express and the Sederberg for $44.5 million, $11.2 million, $15.8 million, $10.2 million and $4.9 million, respectively, resulting in an aggregate net gain of $16.9 million.
Other Operating Expenses
Other Operating Expenses include Voyage Expenses
Voyage Expenses
Voyage expenses remained stable at $7.5 million in the twelve months ended December 31, 2008 and December 31, 2007.
Interest Expense and Interest Income
Interest expense increased 72.1%, or $15.8 million, to $37.7 million in the twelve months ended December 31, 2008, from $21.9 million in the twelve months ended December 31, 2007. The change in interest expense was due to the increase in our average debt by $882.8 million to $1,715.4 million in the twelve months ended December 31, 2008 from $832.6 million in the twelve months ended December 31, 2007. Our extensive new-building program resulted in interest capitalization, rather than such interest being recognized as an expense, of $36.9 million for the twelve months ended December 31, 2008 as opposed to $22.9 million of capitalized interest for the twelve months ended December 31, 2007.
Interest income increased 32.7%, or $1.6 million, to $6.5 million in the twelve months ended December 31, 2008, from $4.9 million in the twelve months ended December 31, 2007. The increase in interest income is mainly attributed to higher average cash deposits, partially offset by lower interest rates, during the twelve months ended December 31, 2008 as opposed to the twelve months ended December 31, 2007.
The restricted cash is attributed to cash raised through our revolving credit facilities designated to finance certain of our new buildings and is gradually utilized to fund progress payments of these new buildings up to their deliveries through the second quarter of 2010.
Other income/(expenses), net
Other income/(expenses), net, increased by $(15.7) million, to $(1.1) million in the twelve months ended December 31, 2008, from $14.6 million in the same period of 2007. The change in other income/(expenses) is mainly attributed to a non-recurring net gain of $15.9 million related to our leasing arrangements of the CSCL Europe, the MSC Baltic, the Maersk Derby, the Maersk Deva, the CSCL Pusan and the CSCL Le Havre and their subsequent restructuring entered into in 2007. In addition, during the fourth quarter of 2008 we recorded a non-recurring expense of $1.6 million in relation to insurance expenses for the years of 2006 and 2007, which have been recorded in 2008 reflecting the contribution of our insurer to the exposure of the International Group of P&I Clubs.
EBITDA
EBITDA on a comparable basis increased by $37.2 million, or 21.8%, to $208.2 million in the twelve months ended December 31, 2008, from $171.0 million in the twelve months ended December 31, 2007, adjusted for a non-recurring insurance expense of $1.6 million for the years of 2006 and 2007 recorded in 2008 and a non-recurring net gain of $15.9 million in relation to leasing arrangements and their subsequent restructuring entered into in 2007. EBITDA on a reported basis increased by $19.7 million, or 10.5%, to $206.6 million in the twelve months ended December 31, 2008, from $186.9 million in the twelve months ended December 31, 2007. A table reconciling EBITDA to net income can be found at the end of this earnings release.
Dividend Payment
On October 24, 2008, the Board of Directors declared a dividend of $0.465 per common share for the third quarter of 2008 for all shareholders of record as of the close of business on November 5, 2008, paid on November 19, 2008. We have suspended further dividend payments until the board of directors, in consultation with management, determines that economic conditions allow dividend payments to be resumed.
Recent News
On February 2, 2009, we entered into a credit facility with Deutsche Schiffsbank, Credit Suisse, and Emporiki Bank of $299.0 million in relation to pre and post-delivery financing for five new-building vessels, the HN 1698, the HN N-220, the HN N-223, the HN N-215 and the HN Z0001, which are currently under construction and are scheduled to be gradually delivered to us from the first quarter of 2009 until the end of the second quarter of 2010. The interest rate on the credit facility will be LIBOR plus margin.
Based on the unaudited financial statements for 2008 and valuations of our fleet as of December 2008 that we received from two independent ship brokers, we determined that we were in breach of covenants under certain of our credit facilities. Substantially all of our long-term debt continues to be classified as non-current as of December 31, 2008 because our debt covenant violations as of December 31, 2008 have been (or are expected to be) waived by our lenders and the relevant covenants have been (or are expected to be) amended to levels that we expect to be able to comply with in future periods. To the extent that we are unable to finalize formalization of these waivers and amendments prior to the issuance of our audited financial statements, any long-term debt for which we have been unable to secure waivers and, where applicable, amended covenants, will be required to be classified as current, reflecting our lenders' ability to call that debt at any time at their option.
On October 24, 2008, the Company's Board of Directors approved a share repurchase program for the repurchase, from time to time, of up to 1,000,000 shares of the Company's common stock (par value $0.01). As at December 31, 2008, the Company had re-acquired 15,000 shares for an aggregate purchase price of $88,156, which has been reported as treasury stock.
On January 2, 2009, the Company took delivery of the new-building 4,253 TEU vessel, the Zim Monaco. The vessel has been deployed on a 12-year time charter with one of the world's major liner companies.
Conference Call and Webcast
On Thursday, March 12 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 March 19, 2009 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 39 containerships aggregating 157,427 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 30 additional containerships aggregating 226,456 TEU with scheduled deliveries up to 2011. The company'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, 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, 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 52 off-hire days in total in the fourth 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.
First Second Third Fourth
Quarter Quarter Quarter Quarter
2008 2008 2008 2008 Total
--------- --------- --------- --------- ---------
No. of No. of No. of No. of No. of
Vessel Utilization Days Days Days Days Days
--------- --------- --------- --------- ---------
Ownership Days 3,301 3,417 3,502 3,560 13,780
Less Off-hire Days:
Scheduled Off-hire
Days (159) (78) (40) (29) (306)
Other Off-hire Days (1) -- (2) (23) (26)
--------- --------- --------- --------- ---------
Operating Days 3,141 3,339 3,460 3,508 13,448
Vessel Utilization 95.2% 97.7% 98.8% 98.5% 97.6%
Revenue - Impact of Off-hire
(in '000s of US Dollars)
100% Fleet
Utilization $ 70,689 $ 74,482 $ 77,303 $ 79,866 $ 302,340
Less Off-hire Days:
Scheduled Off-hire
Days (796) (573) (807) (563) (2,739)
Other Off-hire Days (16) -- (80) (600) (696)
--------- --------- --------- --------- ---------
Actual Revenue
Earned $ 69,877 $ 73,909 $ 76,416 $ 78,703 $ 298,905
========= ========= ========= ========= =========
Fleet List
The following table describes in detail our fleet deployment profile as of March 11, 2009.
Vessel Size
Vessel Name (TEU) Year Built Expiration of 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
MSC Marathon(5) 4,814 1991 September 2011
Maersk Messologi 4,814 1991 September 2011
Maersk Mytilini 4,814 1991 September 2011
MOL Affinity(3) 4,651 1992 March 2011
Hyundai Duke 4,651 1992 February 2011
APL Confidence(4) 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 2011
ZIM Rio Grande 4,253 2008 May 2020
ZIM Sao Paolo 4,253 2008 August 2020
ZIM Kingston 4,253 2008 September 2020
ZIM Monaco 4,253 2009 November 2020
Al Rayyan 3,908 1989 January 2011
YM Yantian 3,908 1989 July 2011
YM Milano 3,129 1988 May 2011
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(2) 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 8, 2008, the Pacific Bridge was renamed to Montreal
Senator at the request of the charterer of this vessel.
(3) On April 15, 2008, the Hyundai Commodore was renamed to MOL
Affinity at the request of the charterer of this vessel.
(4) On June 2, 2008, the MOL Confidence was renamed to APL Confidence
at the request of the charterer of this vessel.
(5) On August 22, 2008, the Maersk Marathon was renamed to MSC
Marathon 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 Size Expected
Vessel Name (TEU) Delivery Time Charter Term
------------------- --------------- ---------------- -----------------
ZIM Dalian 4,253 March 2009(2) 12 years
HN S4001(1) 6,500 April 2009 12 years
HN 1699 4,253 June 2009 12 years
HN S4002(1) 6,500 June 2009 12 years
HN S4003(1) 6,500 August 2009 12 years
HN S4004(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
HN S4005(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
HN H 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.
(2) We expect to take delivery of the vessel on March 31, 2009.
DANAOS CORPORATION
Statements of Income
(Unaudited)
(Expressed in thousands of United States dollars,
except share and per share amounts)
Twelve Twelve
Three months Three months months months
ended ended ended ended
December 31, December 31, December 31, December 31,
------------ ------------ ------------ ------------
2008 2007 2008 2007
------------ ------------ ------------ ------------
OPERATING REVENUES $ 78,703 $ 71,335 $ 298,905 $ 258,845
OPERATING EXPENSES
Vessel operating
expenses (24,111) (19,045) (89,246) (65,676)
Depreciation &
amortization (15,842) (13,220) (58,326) (46,735)
General &
administrative (3,003) (2,695) (11,617) (9,955)
Gain / (loss) on
sale of vessels 1,973 -- 16,901 (286)
Other operating
expenses (1,558) (2,106) (7,657) (7,499)
------------ ------------ ------------ ------------
Income From
Operations 36,162 34,269 148,960 128,694
------------ ------------ ------------ ------------
OTHER EARNINGS (EXPENSES)
Interest income 2,683 1,184 6,544 4,861
Interest expense (12,651) (7,458) (37,734) (21,929)
Other finance
cost, net (399) (1,193) (2,047) (2,779)
Other income /
(expenses), net (1,800) 19,087 (1,060) 14,560
Gain / (loss) on
derivatives (165) (1,239) 2,397 (309)
------------ ------------ ------------ ------------
Total Other Income
(Expenses), net (12,332) 10,381 (31,900) (5,596)
------------ ------------ ------------ ------------
Net income from
continuing
operations $ 23,830 $ 44,650 $ 117,060 $ 123,098
------------ ------------ ------------ ------------
Net (loss) income
from discontinued
operations (262) (8) (1,822) 92,166
------------ ------------ ------------ ------------
Net Income $ 23,568 $ 44,642 $ 115,238 $ 215,264
============ ============ ============ ============
EARNINGS PER SHARE
(from continuing
operations)
Basic and diluted
net income per
share $ 0.44 $ 0.82 $ 2.15 $ 2.26
============ ============ ============ ============
EARNINGS PER SHARE
Basic and diluted
net income per
share $ 0.43 $ 0.82 $ 2.11 $ 3.95
============ ============ ============ ============
Basic and diluted
weighted average
number of shares
(in thousands of
shares) 54,556 54,558 54,557 54,558
============ ============ ============ ============
DANAOS CORPORATION
Balance Sheets
(Unaudited)
(Expressed in thousands of United States dollars)
As of As of
December 31, December 31,
-------------- --------------
2008 2007
-------------- --------------
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 120,720 $ 63,495
Restricted cash, current portion 190,951 46,179
Accounts receivable, net 1,119 4,321
Other current assets 23,954 18,993
-------------- --------------
336,744 132,988
NON-CURRENT ASSETS
Fixed assets, net 1,339,645 1,182,505
Advances for vessel acquisitions and
vessels under construction 1,067,825 745,534
Restricted cash, net of current portion 60,591 --
Deferred charges, net 16,098 10,431
Fair value of financial instruments 6,691 --
Other non-current assets 870 333
-------------- --------------
2,491,720 1,938,803
-------------- --------------
TOTAL ASSETS 2,828,464 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 31,779 24,092
Fair value of financial instruments,
current portion 48,217 1,402
-------------- --------------
112,215 51,113
LONG-TERM LIABILITIES
Long-term debt, net of current portion 2,075,459 1,330,927
Fair value of financial instruments,
net of current portion 414,668 56,537
Other long-term liabilities 7,088 8,310
-------------- --------------
2,497,215 1,395,774
STOCKHOLDERS' EQUITY
Common stock 546 546
Additional paid-in capital 288,615 288,530
Treasury stock (88) --
Accumulated other comprehensive loss (474,514) (54,886)
Retained earnings 404,475 390,714
-------------- --------------
219,034 624,904
-------------- --------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 2,828,464 $ 2,071,791
============== ==============
DANAOS CORPORATION
Statements of Cash Flows
(Unaudited)
(Expressed in thousands of United States dollars)
Twelve Twelve
Three months Three months months months
ended ended ended ended
December 31, December 31, December 31, December 31,
------------ ------------ ------------ ------------
2008 2007 2008 2007
------------ ------------ ------------ ------------
Cash Flows provided
by / (used in):
Operating Activities:
Net income $ 23,568 $ 44,642 $ 115,238 $ 215,264
Adjustments to
reconcile net
income to net
cash provided by
operating
activities:
Depreciation 13,857 11,545 51,025 41,093
Amortization of
deferred charges 2,069 1,716 7,521 6,380
Written off
amount of
deferred charges -- 177 309 621
Stock based
compensation 38 -- 85 --
Payments for
drydocking /
special survey (1,860) (1,521) (10,625) (7,592)
Change in fair
value of debt
and financial
instruments (2,747) 1,239 (15,332) 193
(Gain) / Loss on
sale of vessels (1,973) -- (16,901) (88,349)
Accounts receivable 1,385 (3,048) 3,202 (2,151)
Other assets,
current and
non-current (2,829) 2,307 (5,498) (7,079)
Accounts payable
and accrued
liabilities 3,276 4,760 7,944 2,642
Other liabilities,
current and
non-current (511) (17,934) (1,479) (2,752)
------------ ------------ ------------ ------------
Cash provided by
Operating
Activities 34,273 43,883 135,489 158,270
------------ ------------ ------------ ------------
Investing Activities:
Vessel acquisitions
including advances 19 (111,501) (76,506) (266,608)
Vessels under
construction (121,324) (376,514) (518,512) (696,752)
Proceeds from
sale of vessels 13,929 -- 83,032 275,768
------------ ------------ ------------ ------------
Cash (used in) /
provided by
Investing
Activities (107,376) (488,015) (511,986) (687,592)
------------ ------------ ------------ ------------
Financing Activities:
Debt draw downs 89,797 473,000 805,010 1,014,177
Debt repayment (6,893) (3,593) (59,919) (322,437)
Dividends paid (25,369) (25,369) (101,477) (97,385)
Treasury stock (88) -- (88) --
Deferred costs (1,598) (57) (4,441) (927)
Decrease/
(increase) in
restricted cash 71,479 (11,876) (205,363) (43,686)
------------ ------------ ------------ ------------
Cash provided by /
(used in) Financing
Activities 127,328 432,105 433,722 549,742
------------ ------------ ------------ ------------
Net change in cash
and cash
equivalents 54,225 (12,027) 57,225 20,420
Cash and cash
equivalents,
beginning of
period 66,495 75,522 63,495 43,075
------------ ------------ ------------ ------------
Cash and cash
equivalents, end
of period $ 120,720 $ 63,495 $ 120,720 $ 63,495
============ ============ ============ ============
Reconciliation of Net Income to EBITDA
(Continuing Operations)
Unaudited
Three Three Twelve Twelve
months months months months
ended ended ended ended
December December December December
31, 31, 31, 31,
----------- ----------- ----------- -----------
2008 2007 2008 2007
----------- ----------- ----------- -----------
Net income $ 23,830 $ 44,650 $ 117,060 $ 123,098
Depreciation 13,857 11,545 51,025 40,622
Amortization of
deferred charges 1,985 1,675 7,301 6,113
Interest income (2,683) (1,184) (6,544) (4,861)
Interest expense 12,651 7,458 37,734 21,929
----------- ----------- ----------- -----------
EBITDA (1) from
continuing operations $ 49,640 $ 64,144 $ 206,576 $ 186,901
EBITDA (1) from
discontinued
operations (262) (7) (1,822) 93,113
----------- ----------- ----------- -----------
EBITDA (1) $ 49,378 $ 64,137 $ 204,754 $ 280,014
=========== =========== =========== ===========
(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.
Net Income and EBITDA on a comparable basis - (Continuing operations)
Unaudited
Three Three Twelve Twelve
months months months months
ended ended ended ended
December December December December
31, 31, 31, 31,
----------- ----------- ----------- -----------
2008 2007 2008 2007
----------- ----------- ----------- -----------
Net Income $ 23,830 $ 44,650 $ 117,060 $ 123,098
Prior years insurance
costs(2) 1,636 -- 1,636 --
Lease arrangements
gain(3) -- (19,140) -- (15,905)
----------- ----------- ----------- -----------
Net Income on a
comparable basis $ 25,466 $ 25,510 $ 118,696 $ 107,193
=========== =========== =========== ===========
Earnings Per Share on a
comparable basis 0.47 0.47 2.18 1.96
=========== =========== =========== ===========
EBITDA (1) $ 49,640 $ 64,144 $ 206,576 $ 186,901
Prior years insurance
costs(2) 1,636 -- 1,636 --
Lease arrangements
gain(3) -- (19,140) -- (15,905)
----------- ----------- ----------- -----------
EBITDA(1) on a
comparable basis $ 51,276 $ 45,004 $ 208,212 $ 170,996
=========== =========== =========== ===========
(2) Adjustment represents non-recurring insurance costs for the years of
2006 and 2007, which have been recorded in 2008 in "Other income/
(expense), net" in relation to the contribution of one of our insurers
to the exposure of the International Group of P&I Clubs.
(3) Adjustment represents a non-recurring net gain of $19.1 million and
$15.9 million for the fourth quarter and the full year ended December
31, 2007, in relation to the leasing arrangements for the CSCL Europe,
the MSC Baltic, the Maersk Derby, the Maersk Deva, the CSCL Pusan and
the CSCL Le Havre and their subsequent restructuring entered into in
2007, recorded in "Other income/(expense), net."
Note: Items to consider for comparability include gains and charges. Gains positively impacting net income are reflected as deductions to reported net income. Charges negatively impacting net income are reflected as increases to reported net income.
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 Tables above for supplemental financial data and corresponding reconciliations to GAAP financial measures for the years ended December 31, 2008 and December 31, 2007. 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.
On a roller coaster ride.... interesting trading...
one wonders what the announced dividend will be if there is one
and how much it is cut down.....
That news will drive the pps next week. In the menatime
trade the rollers
cheers,
SJ
One reason why DAC might be down..
At a recent conference for the overall shipping industry the container ship sector was singled out to be more bearish than the dry bulk or tankers. Reason given was that too many owners had gotten on the band wagon all at once and ordered too many ships and unlike the dry bulkers who get some help by a predicted increase in demand and dayrates along with older ships getting scraped ... not many container ships are scheduled to be scrapped due to the newness of the current fleet just at a time the demand is weakening. One of the analyst speaking said that they expect only 50% of the fleet will be utilized in 2010-12 ( now does not that seem to be a bit shocking?) and he did not see any recovery until 2015. He noted the many long term contracts being broken and walked away from or rewritten at lower rates. Of course this is only one man's opinion but a respected analyst within the industry. Noted that day DAC and SSW dipped when the news hit the wires. Once again the debt levels of all these firms have to be considered in this light.
Certainly puts the dividends at risk of being cut back.
Less you think I am just doom and gloom here, you would be wrong. I like DAC in this sector and have traded in and out of it over the last two years and it has made me some nice profits along the way... but this is a time of realistic and steely eyed assessment of this industry. Its day will return again but for now it is rough sailing with more bad news to come... if this analyst is only half right. DAC being a tad bigger than SSW at the moment has the opportunity to buy out some of the poorer financed competitors or pick up some ships on the cheap... the only problem is that this trend could be hurting both big and small shippers at the moment.
So far the China--USA---worldwide trade-- has fallen off dramatically much faster than anyone could foretold and now the recovery looks chancy and not assured in the near future. Personal opinion would be not to rush into the stocks even at these cheap prices until the recovery looks more definite.
When it does the bigger players like DAC will attract the investment dollars first.
***PinewoodsBear***
current dividend 18% @ pps of $10.16.
12 mohnth price target... $25.80
cheers,
SJ
Current Dividend yield is 21%!!!
And was so much better at $4.30... my entry point
cheers,
SJ
Press Release Source: Danaos Corporation
Danaos Corporation Adds 39th Containership to Its Fleet
Tuesday January 6, 9:00 am ET
ATHENS, GREECE--(MARKET WIRE)--Jan 6, 2009 -- Danaos Corporation (NYSE:DAC - News) announced today January 6, 2009, that it took delivery of one more containership, the Zim Monaco, expanding its operational fleet to a total of 39 containerships aggregating 157,427 TEU.
ADVERTISEMENT
The Zim Monaco has a carrying capacity of 4,253 TEU and was built by Samsung Heavy Industries. It is 260 meters long, 32 meters wide and has a speed of 24.5 knots (about 45 Km/h). The Zim Monaco has already commenced its 12-year time charter at fixed rates immediately upon delivery. This vessel is recorded as the first vessel export in Korea's shipbuilding industry in 2009, and it is the 16th vessel Danaos has received from Samsung Heavy Industries out of the 18 vessels that Danaos has ordered in total at the shipyard.
"We enthusiastically welcome the latest delivery," said Dr. Coustas, Chief Executive Officer of Danaos. "We are proud to have taken delivery of the first 2009 built containership from Samsung Heavy Industries. The vessel has already commenced its 12-year time charter with Zim Line, one of the largest containership liner companies in the world. It is chartered at an accretive fixed charter rate which provides Danaos with an effective hedge against market charter rate volatility. We now own and operate a fleet of 39 containerships which provides Danaos with strong cash flows to further support our growth."
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 39 containerships aggregating 157,427 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 30 additional containerships aggregating 226,456 TEU with scheduled deliveries up to 2011. The company's shares trade on the New York Stock Exchange under the symbol "DAC".
Visit our website at www.danaos.com
Contact:
For further information please contact:
Company Contact:
Dimitri 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: nbornozis@capitallink.com
--------------------------------------------------------------------------------
Source: Danaos Corporation
Danaos Corporation is a corporation domesticated in the Republic of The Marshall Islands that is referred to in this Annual Report on Form 20-F, together with its subsidiaries, as "Danaos Corporation," "the Company," "we," "us," or "our." This report should be read in conjunction with our consolidated financial statements and the accompanying notes thereto, which are included in Item 18 to this annual report.
We use the term "Panamax" to refer to vessels capable of transiting the Panama Canal and "Post-Panamax" to refer to vessels with a beam of more than 32.31 meters that cannot transit the Panama Canal. We use the term "twenty foot equivalent unit," or "TEU," the international standard measure of containers, in describing the capacity of our containerships. Unless otherwise indicated, all references to currency amounts in this annual report are in U.S. dollars
Danaos Corporation Announces a Share Repurchase Program
ATHENS, GREECE -- (Marketwire) -- 11/25/08 -- Danaos Corporation (NYSE: DAC) announces that its Board of Directors has approved a share repurchase program and authorized the officers of the Company to repurchase, from time to time, up to 1,000,000 shares of the Company's common stock (par value $0.01).
Citigroup reinitiating coverage... strong hold
26% dividend at current share price of $6.70
https://www.citigroupgeo.com/pdf/SNA26673.pdf
This is insane for a shipping company best positioned to win
clients and has just beat the streets estimates for earnings
and declared a dividend of $.465 per share payable Nov. 19.
This one is a winner in this climate.
cheeers,
SJ
Danaos has some positive divergences between price trend and its indicators going. Need to overcome resistance around 28 nonetheless...
Short-term buy signal on the daily charts as of today. See iBox charts.
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Danaos Corporation is an international owner of containerships, chartering its vessels to many of the world's largest liner companies. Our current fleet of 41 containerships aggregating 165,933 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 28 additional containerships aggregating 217,950 TEU with scheduled deliveries up to 2012. The company's shares trade on the New York Stock Exchange under the symbol "DAC".
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