Danaos Corporation · NYSE:DAC
Danaos — Investor Presentation (May 2024)
51 slides from Danaos's investor presentation, May 2024
Slide 1: Investor Presentation May 2024
Investor Presentation May 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 $2
Slide 5: Danaos by the Numbers
Danaos by the Numbers $2.5bn $324mm Cash Contracted revenue through 2028(1) Cash and Cash Equivalents as of March 31, 2024 0.19x $748mm Net Debt / LTM Q1 2024 Adjusted EBITDA(2) Liquidity(3) as of March 31, 2024 $705mm ~$1.9bn LTM Q1 2024 Adjusted EBITDA Enterprise value(4) (1) Cash Contracted Reven
Slide 6: First Quarter 2024 Financial & Operational Summary
First Quarter 2024 Financial & Operational Summary Three Months ended March 31, 2024 and March 31, 2023 per segment* (Express in thousands of United States dollars, except as otherwise stated) Three Months Ended Three Months Ended March 31, 2024 March 31, 2023 Container Dry Bulk Container Dry Bulk F
Slide 7: Fleet Summary & Strong Charter Coverage Profile
Fleet Summary & Strong Charter Coverage Profile Containership Fleet TEU Capacity(1) Number of vessels (1)(2) 550 Existing Fleet New Buildings 90 Containerships Drybulk vessels 500 91.4 107.9 450 46.4 7 10 400 70 350 436.6 423.7 421.3 419.1 71 69 68 67 300 250 50 2021 2022 2023 March 31, 2024 2021 20
Slide 8: First Quarter 2024 Highlights
First Quarter 2024 Highlights Operating Revenues Adjusted EBITDA USDm USDm $500 $300.0 $400 $200.0 $300 $243.6 $253.4 $177.2 $179.0 $200 $100.0 $100 $0 $0.0 Three Months Ended March 31 Three Months Ended March 31 2023 2024 2023 2024 Adjusted Net Income Free Cash Flow USDm USDm $300.0 $300.0 $200.0 $
Slide 9: First Quarter 2024 Highlights – Segments
First Quarter 2024 Highlights – Segments Operating Revenues per Segment Time Charter Equivalent ($/per day)(1) per Segment USDm USD $60,000 $280.0 $253.4 $38,698 $233.4 $45,000 $210.0 $30,000 $140.0 $15,000 $70.0 $15,455 $20.0 $0 $0.0 Three Months Ended March 31, 2024 Three Months Ended March 31, 20
Slide 10: Substantial Containership Fleet Employment and Charter Coverage
Substantial Containership Fleet Employment and Charter Coverage(1) As of May 22, 2024 Current charter Next Charter Charter Charter 2024 2025 2026 2027 2028 Vessel TEU Age Charterer 1 Rate Expiry Rate Expiry Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q2 2025 Q3 2025 Q4 2025 Q1 2026 Q2 2026 Q3 2026 Q4 2026 Q1 20
Slide 11: Substantial Containership Fleet Employment and Charter Coverage
Substantial Containership Fleet Employment and Charter Coverage(1) As of January 0, 1900 Current charter Next Charter Charter Charter 2024 2025 2026 2027 2028 Vessel TEU Age Charterer 1 Rate Expiry Rate Expiry Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q2 2025 Q3 2025 Q4 2025 Q1 2026 Q2 2026 Q3 2026 Q4 2026 Q1
Slide 12: Substantial Containership Fleet Employment and Charter Coverage
Substantial Containership Fleet Employment and Charter Coverage(1) As of January 0, 1900 Current charter Next Charter Charter Charter 2024 2025 2026 2027 2028 2029 2030 Vessel TEU Age Charterer 1 Rate Expiry Rate Expiry Q2 2024 Q3 2024 Q4 2024 Q1 2025 Q2 2025 Q3 2025 Q4 2025 Q1 2026 Q2 2026 Q3 2026
Slide 13: 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 14: Experienced Senior Management
Experience Senior Management Dr. John Coustas, President & CEO Evangelos Chatzis, Chief Financial Officer • CEO since 1987 • Joined Danaos in 2005 • Over 30 years of experience in • Over 28 years of experience in corporate the shipping industry finance and the shipping industry • Vice Chairman of th
Slide 15: A. Leading Containership Owner and Operator
A. Leading Containership Owner and Operator
Slide 16: 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 17: A Diverse & High-Quality Fleet
A Diverse & High-Quality Fleet Containership Fleet Overview(1) 2x NBs 6,000 TEU 5x Remaining Charter Term : 2.0 years 13,100 TEU 12x Average Age: 11.9 years Remaining Charter Term: 3.0 years NBs 7,200 – 8,300 TEU Remaining Charter Term : 3.0 years 2% 12% 5x 9,600 - 10,100 TEU 22% Average Age: 14.7 y
Slide 18: Charter Backlog to Leading Container Operators
Charter Backlog to Leading Container Operators Containership Charter Backlog(1) (TEU-weighted remaining duration of charter backlog) Charter backlog of 12% 17% $2.5 billion through 3% to 2028(1) 5% 6% Average charter 16% duration of 2.9 years (weighted by aggregate contracted 8% charter hire) (1) 8%
Slide 19: Track Record of Operational Excellence
Track Record of Operational Excellence Danaos' Management Practice Performance(1) Relative to Peers 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 benchm
Slide 20: 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 21: Leading Digitization Performance
Leading Digitization Performance Danaos utilises its leading management software capability, aiding in the optimal management of its fleet System Description Danaos Software Capability Manages maintenance jobs, schedules counter-based and condition- Planned based tasks, and automatically updates sto
Slide 22: 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 23: B. Robust Capital Structure and Conservative Financial Strategy
B. Robust Capital Structure and Conservative Financial Strategy
Slide 24: 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 25: Historical Financial Highlights
Historical Financial Highlights Revenues Adjusted EBITDA USDm USDm $1,200 $1,200 $993 $974 $983 $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 1Q 2017 2018 2019 2020 2021 2022 2023 LT
Slide 26: 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 and 2023 Adjusted EBITDA Multiple(1) USDm Cash and Cash Equivalents Undrawn Commitments Net Adjusted Debt Net Debt / Adjusted EBITDA (RH Axis) $800 $3,000 8.0x 7.
Slide 27: Strong Free Cash Flow Visibility & Great Conversion to OCF
Strong Free Cash Flow Visibility & Great Conversion to OCF LTM 1Q 2024 Free Cash Flow(1) Bridge USDm Drivers of FCF Uses of FCF Higher re-chartering Early repayment of debt and leases LTM 1Q 2024 High utilization Capex and Investments FCF excludes CapEx and Operational efficiency Dividen
Slide 28: Financial Debt Maturity Profile
Financial Debt Maturity Profile Well-balanced repayment profile(1) USDm $300 $265.9 $200 $99.3 $100 $41.2 $16.0 $18.2 $18.2 $0 Remainder 2024 2025 2026 2027 2028 2029 Credit Facilities & Unsecured Notes Breakdown of Financial Debt $459m Credit position • CFR rating : BB+ (Stable) and Ba2 (Stable) an
Slide 29: C.1 Container Vessel Demand & Supply Side Dynamics
C.1 Container Vessel Demand & Supply Side Dynamics
Slide 30: Container Trade: Strong Start to 2024 as Global Economy Strengthens
Container Trade: Strong Start to 2024 as Global Economy Strengthens World Container Trade & GDP, 2000 – 2024F 211 Mn Teu 2023(E) World Container Trade Mn TEU % yoy 275 17.5% 250 15.0% 225 12.5% -0.5% 200 10.0% 175 7.5% 2023(E) Trade yoy Growth 150 5.0% 125 2.5% 100 0.0% 220 Mn Teu 75 -2.5% 2024(F) W
Slide 31: Red Sea Crisis: Freight Markets Rebound Again in Early May 2024
Red Sea Crisis: Freight Markets Rebound Again in Early May 2024 + 1.4 Mn TEU Red Sea Crisis: Freight Markets Rebound Again in Early May 2024 Select Spot Container Freight Rates, Ex-Far East New Vessel Deliveries, Nov-23 to Apr-24 + 1.2 Mn TEU Additional Capacity on Far East-Europe Liner Services, Ap
Slide 32: Demand: US Consumer Spending Resilient, Import Volumes Up vs Q1 2023
Demand: US Consumer Spending Resilient, Import Volumes Up vs Q1 2023 + 23.7% US Containerised Imports from Far East, 2018-23 US Inflation-Adjusted Consumer Spending by Type US Far East TEU Imports, Q1 24 vs Q1 23 Mn TEU 2.0 1.8 + 17.6% 1.6 US Far East TEU Imports, 1.4 Q1 24 vs Q1 19 1.2 2019 1.0 202
Slide 33: Container Timecharter Rates: Ongoing Rebound as Chartering Needs Increase
Container Timecharter Rates: Ongoing Rebound as Chartering Needs Increase +80% 1-Year Timecharter Market Rates, January 2017 – April 2024 8,500 TEU Charter Rate % Ch: Apr 24 vs. Avg 2010-19 +121% 6,500 TEU Charter Rate % Ch: Apr 24 vs. Avg 2010-19 +147% 4,300 TEU Charter Rate % Ch: Apr 24 vs. Avg 20
Slide 34: Supply: Orderbook Falling at 22.4% of Fleet, Sub-12,000 TEU Fleet Ageing
Supply: Orderbook Falling at 22.4% of Fleet, Sub-12,000 TEU Fleet Ageing 22.4% Containership Orderbook, End-April 2024 Age Profile of Fleet: Smaller Vessel Fleet Ageing Industry Orderbook-to-Fleet Ratio, End-April 24 11.3% Orderbook-to-Fleet Ratio: Increase in Sub-12,000 TEU Fleet demand for 7-8 k T
Slide 35: Supply: Net Fleet Growth Highly Elevated, Driven by 12,000+ TEU Deliveries
Supply: Net Fleet Growth Highly Elevated, Driven by 12,000+ TEU Deliveries 734 k TEU Containership Deliveries versus Scrapping, 2014-24 20+ Year-Old Fleets vs Segment Orderbooks Containership Deliveries, Q1 24 296 k TEU Containership Deliveries, Average Q1 14-Q4 22 27 k TEU Containership Demolitions
Slide 36: Idle Capacity: Recent Fall in Idling after Red Sea Escalation
Idle Capacity: Recent Fall in Idling after Red Sea Escalation The volume of idle Idle Containership Capacity: Liner Company Owned vs Tonnage Provider Owned capacity remains at a % Share low level Mn TEU 3.0 80% 70% 2.5 0.7% 2016 60% Idle Fleet at End-Apr 24 71% NOO Owned vs. Peak of 12% in Jun 20 2.
Slide 37: 2,200-13,200 TEU Fleet: Workhorses of Long-Distance Container Trades
2,200-13,200 TEU Fleet: Workhorses of Long-Distance Container Trades 16.4% Danaos Fleet Segment Share of Long-Distance Trade Deployment Orderbook-to-Fleet Ratio in Danaos Fleet Segment Danaos fleet segments provide 75% of capacity 62% of long-haul container trade volumes 75% Share of Capacity on Key
Slide 38: 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 Consolidation between liner 1 companies provides more stable set of counterparties 9 Global Liner Companies,
Slide 39: C.2 Drybulk Vessel Demand & Supply Side Dynamics
C.2 Drybulk Vessel Demand & Supply Side Dynamics
Slide 40: Capesize: Markets Above Longer-Term Averages in 2024
Capesize: Markets Above Longer-Term Averages in 2024 $23,486 k/Day Weekly Average Capesize Spot Rate Developments, 2021-24 Baltic C5TC, Average Wk1-Wk20, 2024 $ k/Day 90 Range, 2015-20 2021 80 2022 2023 $12,099 k/Day 70 2024 60 Baltic C5TC, Average Wk1-Wk20, 2023 50 40 30 $15,969 k/Day 20 Baltic C5T
Slide 41: Capesize: Steel Output Increasing Along Seasonal Lines
Capesize: Steel Output Increasing Along Seasonal Lines China Daily Steel Output, 10-Day Average, 2021-24 Incremental Seaborne Iron Ore Imports, 2018-2024(F) - 86.9 10yr Min-Max (2012-2021) Incremental Iron Ore Imports, MnT/Day 2024 2022 (MnT) 2021 2.6 2022 2023 2.4 2.2 + 39.7 2.0 Incremental Iron Or
Slide 42: Capesize: Incremental Ton-Miles to Maintain Expansion in 2024
Capesize: Incremental Ton-Miles to Maintain Expansion in 2024 Capesize Incremental Tonne-Mile Demand by Cargo Capesize Annual Employment by Cargo (Mn Dwt) + 103.4 Incremental Capesize Coal Ton-Miles 2022, BnTM 40% 2003c Iron Ore 60% + 456.0 2013 Coal 29% Incremental Capesize Ton-Miles 2023E, BnTM Ir
Slide 43: Capesize: Moderate Fleet Growth in 2023, Orderbook Historically Small
Capesize: Moderate Fleet Growth in 2023, Orderbook Historically Small 5.5% Capesize Contracting and Orderbook as % of Fleet, 2000-23 Age Profile of Capesize Fleet Capesize Orderbook-to- Fleet Ratio, End-2023 % Mn Dwt % Share 100 100% 100 Newbuild 90 Contracting 90% 90 15.9% 80 80% 80 Capesize Orderb
Slide 44: D. Appendix
D. Appendix <i a EI Fa
Slide 45: Adjusted Net Income
Adjusted Net Income Reconciliation of Net Income to Adjusted Net Income USD thousands LTM Three Months Ended March 31, Ended March 31, Year Ended December 31, Reconciliation of Net Income / (Loss) to Adjusted Net Income 2024 2023 2024 2023 2023 2022 2021 2020 2019 2018 2017 in thousands of U.S. doll
Slide 46: 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 March 31, 2024 March 31, 2023 Container Dry Bulk Container Dry Bulk Reconciliation of Net Income / (Loss) to Adjusted Net Income Vessels Vessels Other T
Slide 47: Adjusted EBITDA
Adjusted EBITDA Reconciliation of Net Income to EBITDA and Adjusted EBITDA USD thousands LTM Three Months Ended March 31, Ended March 31, Year Ended December 31, Reconciliation of Net Income / (Loss) to EBITDA and Adjusted EBITDA 2024 2023 2024 2023 2023 2022 2021 2020 2019 2018 2017 in thousands of
Slide 48: 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 March 31, 2024 March 31, 2023 Container Dry Bulk Container Dry Bulk Reconciliation of Net Income to Adjusted EBITDA Vessels Vessels Other Total Vesse
Slide 49: 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 Ended March 31, Ended March 31, Year Ended December 31, Reconciliation of Free Cash Flow 2024 2023 2024 2023 2023 2022 2021 2020 2019 in thousands
Slide 50: Stock Performance – Danaos vs. Peers
Stock Performance – Danaos vs. Peers Since July 1, 2020 3000% 2611% 2500% 2000% Stockholders' Return1 1500% 1000% 500% 0% -500% Jul 2020 Oct 2020 Jan 2021 Apr 2021 Jul 2021 Oct 2021 Jan 2022 Apr 2022 Jul 2022 Oct 2022 Jan 2023 Apr 2023 Jul 2023 Oct 2023 Jan 2024 Apr 2024 Danaos Costamare GSL Source:
Slide 51: Thank You
Thank You