Danaos Corporation · NYSE:DAC
Danaos — Investor Presentation (November 2024)
52 slides from Danaos's investor presentation, November 2024
Slide 1: Investor Presentation
Investor Presentation November 2024
Slide 2: Disclaimer
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 expect
Slide 3: Business Highlights
Business Highlights Business Model Provides Strong & ✓ Stable Cash Flow Profile Leading Diverse & High ✓ Containership Owner ✓ Quality Fleet & Operator Pioneers in Demand & Supply Digitalisation & ✓ Side Dynamics ✓ Champion of ESG Robust Capital Principles Structure & ✓ Conservative Financial Strate
Slide 4: Key Business Highlights
Key Business Highlights Leading Containership • One of the largest publicly-listed owners of modern containerships with 50+ year history in the shipping industry A Owner and Operator • One of the most efficient operators in the industry with highly competitive breakeven levels • Charter backlog of $
Slide 5: Danaos by the Numbers
Danaos by the Numbers $3.3bn $384mm Cash Contracted revenue through 2033(1) Cash and Cash Equivalents as of September 30, 2024 0.43x $785mm Net Debt / LTM Q3 2024 Adjusted EBITDA(2) Liquidity(3) as of September 30, 2024 $705mm ~$1.9bn LTM Q3 2024 Adjusted EBITDA Enterprise value(4) (1) Cash Contract
Slide 6: Third Quarter 2024 Financial & Operational Summary
Third Quarter 2024 Financial & Operational Summary Three Months ended September 30, 2024 and September 30, 2023 per segment* (Express in thousands of United States dollars, except as otherwise stated) Three Months Ended Three Months Ended September 30, 2024 September 30, 2023 Container Dry Bulk Cont
Slide 7: Nine Months 2024 Financial & Operational Summary
Nine Months 2024 Financial & Operational Summary Nine Months ended September 30, 2024 and September 30, 2023 per segment* (Express in thousands of United States dollars, except as otherwise stated) Nine Months Ended Nine Months Ended September 30, 2024 September 30, 2023 Container Dry Bulk Container
Slide 8: Fleet Summary & Strong Charter Coverage Profile
Fleet Summary & Strong Charter Coverage Profile Containership Fleet TEU Capacity (in thousands)(1) Number of vessels (1) 600 Existing Fleet New Buildings 90 Containerships Drybulk vessels 550 123.8 500 10 91.4 450 46.4 7 70 400 350 457.5 436.6 423.7 71 72 421.3 69 68 300 250 50 2021 2022 2023 Septem
Slide 9: Third Quarter 2024 and Nine Months 2024 Highlights
Third Quarter 2024 and Nine Months 2024 Highlights Operating Revenues Adjusted EBITDA USDm USDm $800 $600.0 $755.9 $700 $724.3 $500.0 $534.4 $532.9 $600 $500 $400.0 $400 $300.0 $300 $200.0 $200 $256.2 $178.0 $178.9 $239.2 $100.0 $100 $0 $0.0 Three Months Ended September 30 Nine Months Ended Septembe
Slide 10: Third Quarter and Nine Months 2024 Highlights – Segments
Third Quarter and Nine Months 2024 Highlights – Segments Operating Revenues per Segment Time Charter Equivalent ($/per day)(1) per Segment USDm USD $60,000 $1,200.0 $37,817 $37,001 $1,000.0 $45,000 $755.9 $800.0 $30,000 $600.0 $400.0 $699.6 $256.2 $15,000 $16,179 $17,315 $200.0 $235.6 $0.0 $20.6 $56
Slide 11: Substantial Containership Fleet Employment and Charter Coverage
Substantial Containership Fleet Employment and Charter Coverage(1) denotes firm charter period 1 1 denotes firm charter period 2 denotes optional period at the option of the charterer (1) On the basis of US GAAP revenue accounting and concluded charter contracts through November 7, 2024. (2) Age as
Slide 12: Substantial Containership Fleet Employment and Charter Coverage
Substantial Containership Fleet Employment and Charter Coverage(1) denotes firm charter period 1 1 denotes firm charter period 2 denotes optional period at the option of the charterer (1) On the basis of US GAAP revenue accounting and concluded charter contracts through November 7, 2024. (2) Age as
Slide 13: Substantial Containership Fleet Employment and Charter Coverage
Substantial Containership Fleet Employment and Charter Coverage(1) denotes firm charter period 1 1 denotes firm charter period 2 denotes optional period at the option of the charterer (1) On the basis of US GAAP revenue accounting and concluded charter contracts through November 7, 2024. (2) Age as
Slide 14: Drybulk Fleet - Summary
Drybulk Fleet - Summary No. Vessel Type DWT Built Age(1) 1 Achievement Capesize 175,966 2011 13 2 Genius Capesize 175,580 2012 12 3 Ingenuity Capesize 176,022 2011 12 4 Integrity Capesize 175,966 2010 13 5 Peace Capesize 175,858 2010 14 6 W Trader Capesize 175,879 2009 14 7 E Trader Capesize 175,886
Slide 15: Experienced Senior Management
Experience Senior Management Dr. John Coustas, President & Chief Executive Officer Evangelos Chatzis, Vice President & Chief Financial Officer • CEO since 1987 • Joined Danaos in 2005 • Over 30 years of experience in • Over 29 years of experience in corporate the shipping industry finance and the sh
Slide 16: A. Leading Containership Owner and Operator
A. Leading Containership Owner and Operator
Slide 17: 50 Year Legacy of Leadership in Container Shipping
50 Year Legacy of Leadership in Container Shipping 1987 2006 2018 2020 to 2024 Dr. John Coustas steps NYSE IPO Refinancing Strong Free Cash Flow into Chief Executive role Raised $200mn generation and Deleveraging 1972 2005 2010 2019 Founded by Dimitris Coustas Incorporation in Marshall $200mn equity
Slide 18: A Diverse & High-Quality Fleet
A Diverse & High-Quality Fleet Containership Fleet Overview(1) 5x 5x 13,100 TEU NBs 9,200 TEU Average Age: 12.4 years Remaining Charter Term : 5.0 years Remaining Charter Term: 2.6 years 5x 2x 9,600 - 10,100 TEU Average Age: 15.2 years NBs 6,000 TEU 14% 7% Remaining Charter Term: 3.2 years Remaining
Slide 19: Charter Backlog to Leading Container Operators
Charter Backlog to Leading Container Operators Containership Charter Backlog(1) (TEU-weighted remaining duration of charter backlog) 8% Charter backlog of 3% 19% $3.3 billion through 3% to 2033(1) 5% 6% Average charter duration of 3.4 years 17% (weighted by aggregate contracted 7% charter hire) (1)
Slide 20: Track Record of Operational Excellence
Track Record of Operational Excellence Danaos' Management Practice Performance(1) vs SBI average As part of a benchmarking exercise conducted by a global management consulting firm, Management Practice Performance and Safety & Quality Performance was assessed across a number of metrics and benchmark
Slide 21: Pioneers in Digitization Supporting Danaos' Class Leading Operational Excellence
Pioneers in Digitization Supporting Danaos’ Class Leading Operational Excellence Early innovator in utilising technology in optimising operations: 1995 2004 2015 International Safety Management Lloyd’s List Technical Innovation Award Lloyd’s List Intelligence Big Data Award Certification of its cont
Slide 22: Leading Digitization Performance
Leading Digitization Performance Danaos utilises its leading management software capability, aiding in the optimal management of its fleet Danaos Software Capability Note: based on a self-assessment of participating companies – scores are an average of the answers ticked off in the questionnaire Sou
Slide 23: Longstanding Champion of ESG Principles
Longstanding Champion of ESG Principles Danaos Management is keenly focused on maintaining a strong ESG framework for company operations Environmental Social Governance Last 3 Years Progress Advanced solutions to Code of ethics and ✓ Independent Board 72% decrease in the use of ✓ reduce emissions th
Slide 24: B. Robust Capital Structure and Conservative Financial Strategy
B. Robust Capital Structure and Conservative Financial Strategy
Slide 25: Financial Strategy
Financial Strategy Balanced Chartering Strategy • Continue to deploy assets on long-term charters to ensure cash flow visibility Supported by Continued Operational • Maintain high fleet utilization Excellence • Excess cash flow can be used for reducing leverage, for acquisition of young and modern f
Slide 26: Historical Financial Highlights
Historical Financial Highlights Revenues Adjusted EBITDA USDm USDm $1,200 $1,200 $993 $1,005 $974 $1,000 $1,000 $851 $800 $800 $690 $707 $705 $600 $600 $509 $452 $459 $447 $462 $400 $400 $310 $318 $311 $318 $200 $200 $0 $0 2017 2018 2019 2020 2021 2022 2023 LTM 3Q 2017 2018 2019 2020 2021 2022 2023
Slide 27: Focused on Maintaining Conservative Capital Structure
Focused on Maintaining Conservative Capital Structure De-leveraging Profile Cash and Cash Equivalents(2) and Undrawn Commitments Net Debt - Adjusted EBITDA Multiple(1) USDm Net Adjusted Debt Net Debt / Adjusted EBITDA (RH Axis) Cash and Cash Equivalents Undrawn Commitments $3,000 8.0x $800 7.3x Decr
Slide 28: Strong Free Cash Flow Visibility & Great Conversion to OCF
Strong Free Cash Flow Visibility & Great Conversion to OCF LTM 3Q 2024 Free Cash Flow(1) Bridge USDm Drivers of FCF Uses of FCF Higher re-chartering Early repayment of debt and leases LTM 3Q 2024 High utilization Capex and Investments FCF excludes CapEx and Operational efficiency Dividen
Slide 29: Financial Debt Maturity Profile
Financial Debt Maturity Profile Well-balanced repayment profile(1) USDm $300 $279.4 $225.9 $200 $112.9 $100 $31.7 $31.7 $7.9 $0 Remainder 2024 2025 2026 2027 2028 2029 Credit Facilities & Unsecured Notes Breakdown of Financial Debt $689.5m Credit position • Corporate credit rating at BB+ and Ba1 and
Slide 30: C.1 Container Vessel Demand & Supply Side Dynamics
C.1 Container Vessel Demand & Supply Side Dynamics
Slide 31: Container Trade: Industry Records Strong Peak Season
Container Trade: Industry Records Strong Peak Season World Container Trade & GDP, 2000 – 2024F 213 Mn Teu 2023(E) World Container Trade Mn TEU % yoy 275 17.5% 250 15.0% 225 12.5% 0.0% 200 10.0% 2023(E) Trade yoy Growth 175 7.5% 150 5.0% 125 2.5% 224 Mn Teu 100 0.0% 75 -2.5% 2024(F) World Container T
Slide 32: Red Sea Crisis: Liner Markets Stabilise at Healthy Levels
Red Sea Crisis: Liner Markets Stabilise at Healthy Levels + 2.9 Mn TEU Deployed Capacity Changes, Oct-24 vs Oct-23 Select Spot Container Freight Rates, Ex-Far East New Vessel Deliveries, Nov-23 to Jul-24 $/TEU $/FEU Mn TEU 8,000 16,000 3.5 +2.86 7,000 Far East-North 14,000 3.0 Europe + 1.4 Mn TEU 6,
Slide 33: Demand: US TEU Volumes Strong Ahead of Short-Lived Port Strike
Demand: US TEU Volumes Strong Ahead of Short-Lived Port Strike + 19.3% US Containerised Imports from Far East, 2018-24 US Inflation-Adjusted Consumer Spending by Type US Far East TEU Imports, Q3 24 vs Q3 23 Mn TEU Index, 100 2.0 = Jan-18 150 1.8 140 + 17.6% 1.6 130 US Far East TEU Imports, 1.4 9M 24
Slide 34: Container Timecharter Rates: Rates Stable at Elevated Level
Container Timecharter Rates: Rates Stable at Elevated Level +165% 1-Year Timecharter Market Rates, January 2017 – October 2024 $k/Day 8,500 TEU Charter Rate % Ch: 200 Apr 24 vs. Avg 2010-19 180 160 +254% 140 6,500 TEU Charter Rate % Ch: 120 Apr 24 vs. Avg 2010-19 100 80 +313% 60 40 4,300 TEU Charter
Slide 35: Supply: Orderbook Rises to 27.5% of Fleet, Skewed to Largest Fleet Segments
Supply: Orderbook Rises to 27.5% of Fleet, Skewed to Largest Fleet Segments 27.5% Containership Orderbook, End-October 2024 Age Profile of Fleet: Smaller Vessel Fleet Ageing Industry Orderbook-to-Fleet % Share Ratio, End-Oct 24 Mn TEU Orderbook/Fleet: 100% 7.0 43.0% 90% 6.0 80% 12.4% 5.0 70% Orderbo
Slide 36: Supply: Net Fleet Growth Remains Elevated, Set to Slow in 25
Supply: Net Fleet Growth Remains Elevated, Set to Slow in 2025 649 k TEU Containership Deliveries versus Scrapping, 2014-24 20+ Year-Old Fleets vs Segment Orderbooks Containership Deliveries, k TEU % Q2 24 k TEU 1000 1200 100% 30+ Year Fleet Containership Demolitions 90% 25-29 Year Fleet 800 1000 Co
Slide 37: Idle Capacity: Vessel Idling Highly Limited in Scale
Idle Capacity: Vessel Idling Highly Limited in Scale The volume of idle Idle Containership Capacity: Liner Company Owned vs Tonnage Provider Owned capacity Mn TEU % Share remains at a low level 3.0 80% 70% 2.5 0.7% 2016 71% NOO Owned 60% Idle Fleet at End-Oct 24 2.0 vs. Peak of 12% in Jun 20 50% 1.5
Slide 38: 2,200-13,200 TEU Fleet: Workhorses of Long-Distance Container Trades
2,200-13,200 TEU Fleet: Workhorses of Long-Distance Container Trades 15.6% Danaos Fleet Segment Share of Long-Distance Trade Deployment Orderbook-to-Fleet Ratio in Danaos Fleet Segment Danaos fleet segments provide 75% of capacity Transpacific 63% of long-haul container trade volumes Transatlantic 7
Slide 39: Industry to Remain Consolidated as Alliance Patterns Face Shake-Up in 2025
Industry to Remain Consolidated as Alliance Patterns Face Shake-Up in 2025 Recent wave of Announced Changes to Alliances (Current Fleets and Orderbooks) consolidation between liner operators Mn TEU 9.0 Consolidation between liner 8.0 Orderbook 1 companies provides more stable set of counterparties 9
Slide 40: C.2 Drybulk Vessel Demand & Supply Side Dynamics
C.2 Drybulk Vessel Demand & Supply Side Dynamics
Slide 41: Capesize: Markets Soften Following Healthy Q3 Performance
Capesize: Markets Soften Following Healthy Q3 Performance $23,458 k/Day Weekly Average Capesize Spot Rate Developments, 2021-24 Baltic C5TC, Average Wk1-Wk45, 2024 $ k/Day 90 Range, 2015-20 2021 80 2022 2023 70 2024 $14,184 k/Day 60 Baltic C5TC, Average 50 Wk1-Wk45, 2023 40 30 20 $16,648 k/Day 10 Ba
Slide 42: Capesize: Steel Markets Soften Before Stimulus Announcements Increase
Capesize: Steel Markets Soften Before Stimulus Annoucements Increase China Daily Steel Output, 10-Day Average, 2021-24 Incremental Seaborne Iron Ore Imports, 2018-2025(F) + 31.1 10yr Min-Max (2012-2021) MnT/Day 2024 MnT Western Europe % yoy Incremental Iron Ore Imports, 2.6 2021 150 7.5% 2023 (MnT)
Slide 43: Capesize: Iron Ore and Bauxite Drive Tonne-Mile Expansion
Capesize: Iron Ore and Bauxite Drive Tonne-Mile Expansion Capesize Tonne-Mile Demand by Cargo, 10M 23 vs 10M 24 Capesize Annual Employment by Cargo (Mn Dwt) + 206.2 BnTm Incremental Iron Ore 8000 Billions Ton-Miles Coal 10M 24 vs 23, BnTM 10M 2023 2003 40% 7000 Iron 10M 2024 Ore 60% 6000 - 199.0 500
Slide 44: Capesize: Moderate Fleet Growth Expected to Remain in Place
Capesize: Moderate Fleet Growth Expected to Remain in Place 7.0% Capesize Deliveries and Scrapping, 2015-2024 Age Profile of Capesize Fleet Capesize Orderbook-to- Mn Dwt % Share 25+ Years 20-24 Years 15-19 Years Fleet Ratio, End-Q3 2024 10 Scrapping Deliveries 10-14 Years 5-9 Years 0-4 Years 100 8 9
Slide 45: D. Appendix
D. Appendix <i a EI Fa
Slide 46: Adjusted Net Income
Adjusted Net Income Reconciliation of Net Income to Adjusted Net Income USD thousands LTM Three Months Nine Months Ended September 30, Ended September 30, Ended September 30, Year Ended December 31, Reconciliation of Net Income / (Loss) to Adjusted Net Income 2024 2023 2024 2023 2024 2023 2023 2022
Slide 47: Adjusted Net Income per segment
Adjusted Net Income per segment Reconciliation of Net Income to Adjusted Net Income per segment USD thousands Three Months Ended Three Months Ended September 30, 2024 September 30, 2023 Container Dry Bulk Container Dry Bulk Reconciliation of Net Income / (Loss) to Adjusted Net Income Vessels Vessels
Slide 48: Adjusted EBITDA
Adjusted EBITDA Reconciliation of Net Income to EBITDA and Adjusted EBITDA USD thousands LTM Three Months Nine Months Ended September 30, Ended September 30, Ended September 30, Year Ended December 31, Reconciliation of Net Income / (Loss) to EBITDA and Adjusted EBITDA 2024 2023 2024 2023 2024 2023
Slide 49: Adjusted EBITDA per segment
Adjusted EBITDA per segment Reconciliation of Net Income to EBITDA and Adjusted EBITDA per segment USD thousands Three Months Ended Three Months Ended September 30, 2024 September 30, 2023 Container Dry Bulk Container Dry Bulk Reconciliation of Net Income to Adjusted EBITDA Vessels Vessels Other Tot
Slide 50: Free Cash Flow
Free Cash Flow Reconciliation of Free Cash Flow to Net Increase / (Decrease) in Cash, cash equivalents and restricted cash USD thousands LTM Three Months Nine Months Ended September 30, Ended September 30, Ended September 30, Year Ended December 31, Reconciliation of Free Cash Flow 2024 2023 2024 20
Slide 51: Stock Performance – Danaos vs. Peers
Stock Performance – Danaos vs. Peers Since July 1, 2020 3000% 2,446% 2500% 2000% Stockholders' Return 1 1500% 1000% 500% 0% -500% Jul 2020Oct 2020Jan 2021Apr 2021Jul 2021Oct 2021Jan 2022Apr 2022Jul 2022Oct 2022Jan 2023Apr 2023Jul 2023Oct 2023Jan 2024Apr 2024Jul 2024Oct 2024 Danaos Costamare GSL Sour
Slide 52: Thank You
Thank You