Danaos Corp. (NYSE: DAC ) is a ship-owning company dedicated to maritime transport. The company has a total portfolio of 74 container vessels and 10 dry bulk vessels. This makes it one of the main competitors inI am an individual investor with over 10 years of trading. I have been developing as a stock analyst for the last five years. I am inclined to search for Value companies, mainly linked to the production of commodities. I mainly focus on companies that show sustained free cash flows over time, low lev ...

Investor Presentation May 2025 Disclaimer This presentation contains certain statements that may be deemed to be "forward-looking statements" within the meaning of the Securities Exchange Act of 1934. All statements, other than statements of historical facts, that address activities, events or developments that the Company expects, projects, believes or anticipates will or may occur in the future, including, without limitation, the outlook for fleet utilization and shipping rates, general industry condition ...

Danaos (DAC) Q1 2025 Earnings Call May 14, 2025 09:00 AM ET Company Participants Evangelos Chatzis - VP, CFO, Treasurer & SecretaryJohn Coustas - Chairman, President & CEOOmar Nokta - Managing Director Operator Good day, and welcome to the Danaus Corporation Conference Call to discuss the Financial Results for the Three Months Ended 03/31/2025. As a reminder, today's call is being recorded. Hosting the call today is Doctor. John Coustas, Chief Executive Officer of Danaus Corporation and Mr. Evangelos Hazzis ...

Financial Data and Key Metrics Changes - The company reported adjusted EPS of $6.04 per share for Q1 2025, down from $7.15 per share in Q1 2024, reflecting a decrease in adjusted net income from $140 million to $113.4 million, a decline of $26.6 million [11] - Total operating costs increased by $19.8 million, primarily due to a rise in the average number of vessels in the fleet, while net finance costs rose by $6 million [11][12] - Adjusted EBITDA decreased by 3.1% or $5.5 million to $171.7 million compared to $177.2 million in Q1 2024 [14] Business Line Data and Key Metrics Changes - Revenues from the drybulk segment decreased by $9 million due to a softer spot market, while container segment revenues fell by $9.4 million due to lower contracted charter rates [11] - Fleet utilization decreased, contributing to a $6.4 million drop in revenues, mainly due to increased dry dockings [11] Market Data and Key Metrics Changes - The drybulk market has shown modest recovery from its lows, but a meaningful recovery is challenging without further growth initiatives in China [6] - The Pacific market has experienced a dramatic decline due to tariff uncertainties and ongoing armed conflicts, particularly between India and Pakistan [5] Company Strategy and Development Direction - The company is focusing on optimizing the performance of its existing fleet and investing in energy-saving devices to enhance competitiveness [20] - A significant growth backlog includes 15 container vessels scheduled for delivery over the next three years, all backed by profitable charter arrangements [9] - The company is holding off on new vessel investments due to the current environment of expensive new builds and unclear future fuel options [21] Management's Comments on Operating Environment and Future Outlook - Management noted that the U.S. economy remains resilient, with expectations of a rebound in trade flows as consumer spending continues [6] - The proposed IMO regulation on greenhouse gas emissions is seen as insufficient to drive meaningful progress in decarbonization, leading to uncertainty in future fuel options [8] Other Important Information - The company declared a dividend of $0.85 per share for the quarter and has repurchased $36.9 million worth of stock, totaling $205.7 million in share repurchases to date [15] - As of March 31, 2025, cash stood at $480 million, with total liquidity at $825 million, providing flexibility for capital deployment opportunities [15] Q&A Session Summary Question: Focus on cash generation or investment opportunities in existing fleet? - Management confirmed a focus on investing in energy-saving devices to enhance competitiveness while also generating significant cash [20] Question: Continuation of stock buybacks? - Management indicated that there is $100 million authorized for buybacks, but no specific targets or timelines were set for execution [22] Question: Reason for increasing stake in Star Bulk? - The additional investment in Star Bulk was seen as a compelling opportunity, with no specific plans for the time being [23][24]

Core Viewpoint - Danaos Corporation reported strong financial performance for Q1 2025, with total operating revenues of $253.3 million, slightly down from $253.4 million in Q1 2024, while net income decreased to $115.1 million from $150.5 million in the same period last year [2][20][21]. Financial Summary - Operating revenues for container vessels increased by 1.2% to $236.2 million, driven by newbuilding additions, while dry bulk vessel revenues decreased by 14.5% to $17.1 million due to lower charter rates and utilization [21][23]. - Adjusted net income for Q1 2025 was $113.4 million, or $6.04 per diluted share, compared to $140.0 million, or $7.15 per diluted share in Q1 2024 [15][20]. - Adjusted EBITDA decreased by 3.1% to $171.7 million from $177.2 million year-over-year, attributed to increased operating expenses and finance costs [42]. Operational Metrics - The average number of container vessels increased to 73.7 in Q1 2025 from 68.0 in Q1 2024, with fleet utilization for container vessels at 97.2% compared to 97.3% in the previous year [14]. - Dry bulk vessel utilization decreased to 92.4% from 93.6% year-over-year [14]. Recent Developments - The company secured a syndicated loan facility of up to $850 million to finance newbuilding container vessels scheduled for delivery from 2026 to 2028 [11]. - Danaos has a backlog of contracted revenues totaling $3.7 billion, with a charter coverage of 99% for 2025 and 85% for 2026 [10][11]. - A dividend of $0.85 per share was declared for Q1 2025, payable on June 5, 2025 [44]. Market Insights - The dry bulk market has shown modest recovery, but significant growth is contingent on further initiatives in China [9]. - The company is currently focusing on optimizing its existing fleet performance rather than new vessel investments [13]. Environmental Regulations - Proposed IMO regulations on greenhouse gas emissions are seen as insufficient to drive meaningful progress in decarbonization, with limited incentives for using expensive green fuels [11][12].

Company Overview - Danaos Corporation is one of the largest independent owners of modern, large-size container vessels, with a fleet of 74 containerships aggregating 471,477 TEUs and 15 under construction vessels aggregating 128,220 TEUs, ranking among the largest container vessel charter owners globally based on total TEU capacity [5] - The company has recently expanded into the drybulk sector by acquiring 10 Capesize drybulk vessels aggregating 1,760,861 DWT [5] - Danaos Corporation's shares are traded on the New York Stock Exchange under the symbol "DAC" [5] Upcoming Financial Results - Danaos Corporation will release its results for the first quarter ended March 31, 2025, after the market closes in New York on May 13, 2025 [1] - A conference call to discuss the results will be hosted by the management team on May 14, 2025, at 9:00 A.M. ET [1] Conference Call Details - Participants can join the conference call by dialing in 10 minutes before the scheduled time using specific toll-free numbers for the U.S., U.K., and standard international calls [2] - A telephonic replay of the conference call will be available until May 21, 2025, with specific dial-in numbers provided [3] - A live audio webcast of the conference call will be available on the Danaos Corporation website, with an archived version accessible within 48 hours post-call [4]

Group 1 - Danaos Corporation has approved an increase in its common stock repurchase program by an additional $100 million, raising the total program to $300 million [1] - The company has already executed share repurchases of approximately $196 million out of the previous $200 million program [1] - Shares may be purchased in open market or through privately negotiated transactions, with the program subject to suspension or discontinuation at any time [1] Group 2 - Danaos Corporation is one of the largest independent owners of modern, large-size containerships, with a fleet of 74 containerships totaling 471,477 TEUs and 15 under construction aggregating 128,220 TEUs [2] - The company has also invested in the dry bulk sector, acquiring 10 capesize bulk carriers with a total of 1,760,861 DWT [2] - Danaos' fleet is chartered to many of the world's largest liner companies on fixed-rate charters, reflecting its operational efficiency and rigorous standards [2]

Company Overview - Danaos Corporation is one of the largest independent owners of modern, large-size containerships with a fleet of 74 containerships aggregating 471,477 TEUs and 15 under construction containerships aggregating 128,220 TEUs [3] - The company has recently expanded into the dry bulk sector by acquiring 10 capesize bulk carriers aggregating 1,760,861 DWT [3] - Danaos Corporation's shares are traded on the New York Stock Exchange under the symbol "DAC" [3] Financial Reporting - The company has filed its Annual Report on Form 20-F for the year ended December 31, 2024, with the Securities and Exchange Commission [1] - Shareholders can request a hard copy of the complete audited financial statements free of charge [2]

Financial Performance - As of December 31, 2024, total debt amounted to $744.5 million, which is projected to increase to $788.5 million after adjustments for a $44.0 million drawdown and share repurchases[24][25]. - The company repurchased 318,306 shares of common stock for a total cost of $25.6 million, and declared a dividend of $0.85 per share, totaling $15.9 million[22]. - The company has a total stockholders' equity of $3.42 billion as of December 31, 2024, which is adjusted to $3.38 billion after accounting for share repurchases[24]. - The company recorded an impairment loss of $210.7 million for older vessels as of December 31, 2018, indicating potential volatility in vessel values[54]. - For the year ended December 31, 2024, the company recognized a $25.2 million loss on marketable securities and dividend income of $9.3 million from these securities[86]. - Approximately 24.6% of the company's vessels' operating expenses were incurred in currencies other than U.S. dollars, primarily Euros, for the year ended December 31, 2024[95]. - The company generates most of its revenues from charters, and any decline in demand for services could significantly reduce revenue and earnings[67]. Market Conditions - The benchmark one-year daily rate for a 4,400 TEU Panamax containership increased from $17,100 at the end of December 2023 to $56,000 at the end of 2024, indicating a significant recovery in charter rates[35]. - The Baltic Dry Index (BDI) experienced fluctuations, declining significantly in the second half of 2022 but rebounding in the second half of 2023 and the first half of 2024 before declining again in February 2025 due to weakened demand for commodities[40]. - The company anticipates that future demand for drybulk vessels and charter rates will depend on global economic growth, seasonal demand changes, and the capacity of the global drybulk vessel fleet[45]. - A decline in demand for commodities transported in drybulk vessels, particularly iron ore and coal, could significantly affect charter rates and the company's financial condition[45]. - Increased trade protectionism globally, including tariffs imposed by the U.S. and other countries, could adversely impact the demand for shipping and the company's revenues[59]. - The size of the containership order book increased significantly, with newbuilding containerships representing about 27.5% of the existing global fleet capacity by the end of 2024, potentially leading to oversupply and reduced charter rates[68]. - The market supply of drybulk vessels increased due to high new deliveries, with orders for Capesize vessels at approximately 8% of existing fleet capacity at the end of 2024, which could depress charter rates[69]. Competition and Market Risks - The company faces substantial competition in expanding relationships with existing charterers and obtaining new charters in the containership and drybulk sectors[29]. - The company’s profitability is highly dependent on global economic conditions and demand for containerships and drybulk vessels, which are subject to significant volatility[29]. - Increased competition from established companies and new entrants may lead to greater price competition for charters, adversely affecting profitability[72]. - The company faces challenges in securing profitable employment for its vessels, with 5 of its 74 containerships on time charters expiring in 2025[46]. - Fleet inefficiencies due to geopolitical tensions and sanctions have resulted in increased vessel employment rates, which may not be sustainable[45]. Debt and Financing - The company entered a new $850 million credit facility in February 2025, which may limit its ability to fund capital expenditures for future growth[88]. - The company may encounter difficulties in obtaining financing due to tighter lending standards and increased interest rates in the shipping industry[57]. - The company’s ability to service its debt will depend significantly on future operating performance and prevailing charter rates for its vessels[108]. - The company is exposed to volatility in interest rates, particularly SOFR, which has increased significantly in recent years, potentially affecting earnings and cash flow[116]. - The company does not currently have any interest rate hedging arrangements, increasing its exposure to interest rate fluctuations[116]. - The company’s debt level could limit its flexibility in responding to changing business and economic conditions[112]. Operational Risks - The company is exposed to risks related to interest rate volatility and exchange rate fluctuations, which could impact financial performance[34]. - The company may incur material liabilities under environmental laws, which could subject it to penalties and fines[121]. - The operation of ocean-going vessels carries inherent risks, including marine disasters and environmental accidents, which could negatively impact revenues and reputation[139]. - The company’s insurance may be insufficient to cover losses from operational risks, including mechanical failure and environmental disasters[143]. - Future geopolitical tensions and conflicts could adversely affect demand for cargoes and overall business operations[136]. - The company does not currently carry loss of hire insurance, which could materially adversely affect its business and financial condition during extended vessel off-hire periods[145]. Fleet and Chartering - The company operates a fleet of 74 containerships with a total capacity of 471,477 TEUs and 10 Capesize bulk carriers with a total deadweight tonnage of 1,760,861 DWT as of February 28, 2025[193]. - The average age of the current fleet of 74 containerships is approximately 14.4 years, and the average age of ten Capesize bulk carriers is approximately 14.2 years as of February 28, 2025[90]. - The average remaining duration of charters for the 89 containerships is 3.9 years, expected to generate approximately $3.8 billion in contracted revenues[198]. - The company has ordered 22 newbuilding containerships since the beginning of 2022, with 15 yet to be delivered, and acquired ten secondhand Capesize drybulk vessels in 2023[82]. - The company aims to expand its fleet of Capesize drybulk vessels, having acquired ten vessels since mid-2023, while facing substantial competition for new charters[71]. - The company operates drybulk vessels mainly on short-term charters, exposing it to fluctuations in spot market rates[202]. - The company intends to charter its drybulk vessels primarily on short-term time charters and voyage charters, exposing it to fluctuations in spot market rates[217]. Regulatory and Compliance Issues - Environmental regulations may require significant expenditures and affect cash flows, including compliance with the global 0.5% sulfur cap on marine fuel[120]. - The United States announced a commitment to achieve zero emissions from international shipping by 2050, with new metrics for measuring energy efficiency and carbon emissions coming into force on January 1, 2023[123]. - Maritime shipping will be included in the European Union's Emission Trading Scheme (ETS) starting January 1, 2024, requiring shipping companies to surrender 40% of their 2024 emissions in 2025, 70% in 2026, and 100% in 2027[123]. - The company is subject to compliance with the U.S. Foreign Corrupt Practices Act, and violations could result in substantial fines and damage to reputation[131]. Management and Governance - The management of operations is overseen by the CEO, COO, CFO, and CCO, in conjunction with the board of directors[218]. - The company’s operational success significantly depends on the satisfactory performance of its Manager and Danaos Chartering, which provide essential technical and administrative services[155]. - The management agreements with Danaos Shipping and Danaos Chartering expire on December 31, 2025, and automatically extend for additional 12-month terms unless a six-month notice of non-renewal is given[156]. - Major stockholder DIL owns approximately 50.02% of the outstanding shares as of February 27, 2025, allowing it to control significant corporate actions[174]. - The company has engaged in activities that may present conflicts of interest with its major stockholder, potentially affecting strategic decisions[176].

Core Insights - Carrix partners with Nokia to implement Nokia DAC, a private wireless solution aimed at enhancing operations in key U.S. marine terminals [2][3] - The collaboration focuses on improving network security, performance, and reliability in asset-intensive environments [5] Company Overview - Carrix operates over 250 terminal facilities and rail yards across the U.S., Canada, Mexico, Central America, South America, and Asia, employing more than 20,000 people [3][9] - Nokia is a leading global vendor of private wireless solutions, serving 850 customers in industries such as mining, manufacturing, and ports [4] Technological Impact - Nokia DAC provides reliable wireless connectivity tailored for industrial marine terminal environments, enhancing security and scalability while laying the groundwork for future digital innovations [3][5] - The solution addresses complex challenges in the marine terminals industry, facilitating the introduction of new use cases and applications through Nokia's Edge Compute and AI platform [5] Strategic Importance - The partnership is expected to drive innovation and collaboration within the port industry while ensuring data sovereignty and security [5] - Carrix's Director of IT Services highlighted the significant improvements in efficiency and technology initiatives due to Nokia DAC [5]