Danaos Corporation · NYSE:DAC
Danaos — Investor Presentation (May 2015)
26 slides from Danaos's investor presentation, May 2015
Slide 1: Danaos Corporation | May 2015
Danaos Corporation | MAY 2015 World-Class Shipping, Leading-Edge Expertise
Slide 2: Disclosures
Disclosures 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 expec
Slide 3: Business Overview
Business Overview DISCIPLINED BUSINESS MODEL • One of the largest independent owners of modern containerships • Long-term charters with the world’s leading liner companies • High charter coverage protects free cash flow generation and limits market risk • Counterparties track record solid even durin
Slide 4: Recent Operational and Financial Highlights
Recent Operational and Financial Highlights FLEET MANAGEMENT • Newbuilding program successfully completed in 2012 • Nine older vessels sold in 2013 and five in 2014 • Tactical purchases of newer vessels: four 2,500-3,500 TEU geared vessels in 2013 and two 6,400 TEU vessels in 2014 • Average fleet ag
Slide 5: Fleet Profile
Fleet Profile 56 Container Vessels ranging from 2,200 TEU to 13,100 TEU 8 X 2,200 TEU 12 X 4,300 TEU 7 X 8,500 TEU 2 X 2,500 TEU 1 X 4,650 TEU 2 X 9,600 TEU 1 X 2,600 TEU 2 X 6,400 TEU 3 X 10,100 TEU 6 X 3,400 TEU 7 X 6,500 TEU 5 X 13,100 TEU 400K Fleet Capacity by Year Capacity Additions 350K CAPAC
Slide 6: Young Fleet with Long-term Charters
Young Fleet with Long-term Charters Fleet age in years (weighted by TEU) 8.5 21% Reduction in Fleet Age 7.3 6.6 6.4 6.4 6.7 Over the last 5 years 2010 2011 2012 2013 2014 1Q 2015 Charter Length in years (weighted by aggregate contracted charter hire) 9.7 9.8 9.7 8.9 7.8 8.0 7.8 Average length of cur
Slide 7: Leading Position with 56 Vessel Fleet
CAPACITY (TEU MILLIONS) 0 400,000 200,000 600,000 800,000 Seaspan Costamare ShoeiKisen ZodiacM'time Danaos Corp. Technomar large charter owners SynergyMarine Independent Owners A market leader among the Current Capacity PeterDohle 5 Leading Position with 56 Vessel Fleet C-POffen Blue Star Holding Ri
Slide 8: Diverse Charters with Strong Counterparties
Diverse Charters with Strong Counterparties Last 12 Months | Revenues per Charterer 28% 26% 18% 11% 8% 6% 3% Other $3.6 billion contracted revenue from long-term fixed rate diversified charters 6
Slide 9: Experienced Senior Management and Board
Experienced Senior Management and Board Management Dr. John Coustas Chairman & Chief Executive Officer – Director Iraklis Prokopakis Senior Vice President & Chief Operating Officer - Director Evangelos Chatzis Chief Financial Officer Dimitris Vastarouchas Deputy Chief Operating Officer Non-Executive
Slide 10: Industry Overview
Industry Overview
Slide 11: Demand / Supply Fundamentals
Demand / Supply Fundamentals Global Throughput Growth Global Capacity Growth 14.2% 13.8% 13.2% 12.4% 9.1% 8.4% 8.2% 7.9% 6.3% 6.0% 5.8% 5.8% 5.5% 5.5% 5.4% ANNUAL GROWTH 5.2% 5.1% 4.8% 3.8% (8.5%) 2007 2008 2009 2010 2011 2012 2013 2014 2015F 2016F Source: Alphaliner 8
Slide 12: Healthy Orderbook
Healthy Orderbook 1.80 70% 1.60 60% Fleet & Orderbook (TEU Millions) 1.40 Orderbook-to-Fleet Ratio 50% 1.20 1.00 40% 0.80 30% 0.60 20% 0.40 10% 0.20 0.00 0% J-00 J-03 J-06 J-09 J-10 J-11 O-11 J-12 D-12 M-13 J-13 S-13 D-13 A-14 J-14 O-14 J-15 A-15 Fleet Orderbook Orderbook-to-Fleet Ratio Source: Clar
Slide 13: Financial Overview
Financial Overview
Slide 14: Operating Revenues Projections
Operating Revenues Projections Operating Revenues from Continuing Operations (1) Marsoft High Case Marsoft Base Case Marsoft Low Case Contracted Revenue $700 $589 $588 $600 $552 $500 $468 (amounts in million US$) $400 $360 $320 $299 $300 $259 $555 $205 $520 $489 $446 $200 $100 $0 2006 2007 2008 2009
Slide 15: Operating Revenue Sensitivity Analysis
Operating Revenue Sensitivity Analysis Projected Total Operating Revenues & Sensitivity on Re-chartering Rates (1) (amounts in million US$) Re-chartering 2014 2015 2016 2017 2018 2.3% High Case N/A 570 615 631 624 Base Case 552 569 598 612 606 Low Case N/A 565 573 587 580 3.4% (1) All projections on
Slide 16: EBITDA Projections
EBITDA Projections Adjusted EBITDA from Continuing Operations (1) Marsoft High Case Marsoft Base Case Marsoft Low Case Contracted Revenue $500 $450 $432 $434 $404 $400 (amounts in million US$) $350 $319 $300 $244 $250 $204 $189 $410 $200 $174 $395 $372 $343 $140 $150 $100 $50 $0 2006 2007 2008 2009
Slide 17: Adjusted EBITDA Sensitivity Analysis
Adjusted EBITDA Sensitivity Analysis Projected Adjusted EBITDA & Sensitivity on Re-chartering Rates (1) (amounts in million US$) Re-chartering 2014 2015 2016 2017 2018 3.1% High Case N/A 415 453 466 456 Base Case 404 413 436 447 439 Low Case N/A 410 411 422 413 4.6% (1) Adjusted EBITDA is defined as
Slide 18: Significant Free Cash Flow per Share
Significant Free Cash Flow per Share Free Cash Flow per Share (1) Marsoft High Case Marsoft Base Case Marsoft Low Case $3.3 $3.2 $3.4 $3.3 $3.2 $2.9 $3.0 $3.0 $2.8 $2.5 $2.5 $2.5 $1.8 2014 2015 2016 2017 2018 (1) Defined as Net Cash generated for the period before Net Vessel Acquisitions / Disposals
Slide 19: Expiring Swaps Benefit Net Income and Free Cash Flow
Expiring Swaps Benefit Net Income and Free Cash Flow Net Finance Costs (amounts in million US$) Under Base Case Marsoft Scenario $250 2.50% $198 $200 2.00% Libor Rate $150 1.50% $121 $100 1.00% $77 $78 $73 $50 0.50% $0 0.00% 2014 2015 2016 2017 2018 Net Interest Expense Swaps Expense Libor Curve as
Slide 20: Rapid De-leveraging
Rapid De-leveraging Base Case Low Case Net Debt and Adjusted EBITDA Multiple (1) Net Debt and Adjusted EBITDA Multiple (1) (Amounts in million of US$) (Amounts in million of US$) $3,500 7.3x Net Debt $3,500 7.3x Net Debt $2,945 6.5x $2,945 6.5x $3,000 $3,000 $2,674 5.3x $2,677 5.8x $2,500 $2,333 4.5
Slide 21: Our Future is Bright
Our Future is Bright • Our new capital structure allows us to profitably and prudently expand the company • Long-term fixed rate charters provide cash flow visibility • Excellent long-term customer relationships tested during the last crisis • We are well positioned to participate in the next growth
Slide 22: World-Class Shipping, Leading-Edge Expertise
World-Class Shipping, Leading-Edge Expertise Company Contacts Investor Relations EVANGELOS CHATZIS IRAKLIS PROKOPAKIS ROSE & COMPANY Chief Financial Officer Senior VP & Chief Operating Officer 405 Park Avenue, Suite 901 Danaos Corporation Danaos Corporation New York, NY 10022 Athens, Greece Athens,
Slide 23: Appendix
Appendix
Slide 24: Underlying Assumptions
Underlying Assumptions Operating Revenues • Contracted periods run until earliest dates charters can expire, no options exercised • Assumes full performance by all counterparties to existing charters, which depends on such charterers’ ability to meet their obligations under these charters • Nine of
Slide 25: Underlying Assumptions: Adjusted EBITDA
Underlying Assumptions Adjusted EBITDA (1) • Non-GAAP measure, defined herein as Earnings before Interest, Depreciation, Amortization, non-cash and one- off items • Reconciliation of Net Cash Provided by Operating Activities to Adjusted EBITDA under Base and Low Case Scenarios: Reconciliation of Net
Slide 26: Underlying Assumptions: Libor Curve
Underlying Assumptions • Calculation of interest and swap cash flows are based on the following forward US$ interest rate Libor curve as at May 4, 2015 LIBOR CURVE ASSUMPTION 2.50% 2.10% 2.00% 1.71% 1.50% 1.01% 1.00% 0.43% 0.36% 0.50% 0.27% 0.23% 0.00% 2012 2013 2014 2015 2016 2017 2018 • Interest r