Danaos corporation reports first quarter results for the period ended march 31, 2022
Athens, greece--(business wire)--danaos corporation (“danaos”) (nyse: dac), one of the world’s largest independent owners of containerships, today reported unaudited results for the quarter ended march 31, 2022. highlights for the first quarter ended march 31, 2022: adjusted net income1 of $235.3 million, or $11.36 per share, for the three months ended march 31, 2022 compared to $58.0 million, or $2.83 per share, for the three months ended march 31, 2021, an increase of 305.7%. net income of $331.5 million, or $16.00 per share, for the three months ended march 31, 2022 compared to $296.8 million, or $14.47 per share, for the three months ended march 31, 2021. liquidity in cash and marketable securities was $708 million as of march 31, 2022. operating revenues of $229.9 million for the three months ended march 31, 2022 compared to $132.1 million for the three months ended march 31, 2021, an increase of 74.0%. adjusted ebitda1 of $269.5 million for the three months ended march 31, 2022 compared to $96.3 million for the three months ended march 31, 2021, an increase of 179.9%. total contracted operating revenues were $2.7 billion as of march 31, 2022, with charters extending through 2028 and remaining average contracted charter duration of 3.8 years, weighted by aggregate contracted charter hire. charter coverage of 95.5% for the next 12 months based on current operating revenues and 96.2% in terms of contracted operating days. danaos has declared a dividend of $0.75 per share of common stock for the first quarter of 2022, which is payable on june 8, 2022 to stockholders of record as of may 27, 2022. during the second quarter of 2022 we have repaid and are committed to repay early $437 million of debt and leasing obligations as a result of which 13 vessels in our fleet will become unencumbered. three months ended march 31, 2022 financial summary - unaudited (expressed in thousands of united states dollars, except per share amounts) three months ended three months ended march 31, march 31, 2022 2021 operating revenues $ 229,901 $ 132,118 net income $ 331,465 $ 296,780 adjusted net income1 $ 235,297 $ 58,011 earnings per share, diluted $ 16.00 $ 14.47 adjusted earnings per share, diluted1 $ 11.36 $ 2.83 diluted weighted average number of shares (in thousands) 20,717 20,513 adjusted ebitda1 $ 269,484 $ 96,282 1 adjusted net income, adjusted earnings per share and adjusted ebitda are non-gaap measures. refer to the reconciliation of net income to adjusted net income and net income to adjusted ebitda. danaos’ ceo dr. john coustas commented: "the first quarter of 2022 was another exceptional one for danaos. having already seeded the future with $2.7 billion of contracted revenue, we are operating from a position of strength and confidence. this allowed us to invest in the future by ordering six vessels in the 7,000 - 8,000 teu range, to be delivered between march and september 2024, that are ready to be converted to run on green methanol when such fuel is widely available. our position in zim continues to generate solid returns, including $110 million in net dividends declared in the first quarter. the broader market has been affected by geopolitical events, high energy prices, inflation, the interest rate outlook, and china's "zero-covid" policy. although box freight rates and charter rates have not been significantly affected, sentiment has changed, and market participants have adopted a more conservative short-term attitude. on the other hand, supply chain inefficiencies continue unabated and there is little likelihood that conditions improve this year. this has led to record profits for the liner companies and, most importantly, higher contract levels. also, fuel oil prices are reaching levels not seen for more than a decade at the same time as supply chain disruptions have resulted in an increase in average sailing speed. over time, the global container network will normalize as new vessels are delivered and sailing speeds are reduced to enable the industry to comply with decarbonization timelines. in the midst of an uncertain backdrop, danaos is well positioned to continue to execute our strategy. we are simultaneously pursuing fleet growth, returning value to shareholders, and further enhancing our balance sheet. most recently, we have accelerated de-leveraging to minimize the impact of rising interest rates. during the second quarter of 2022 we have already repaid early $364 million in debt and lease obligations while another $73 million, for which we have issued early repayment notices, will also be repaid early through the end of the second quarter. as a result of this overall leverage reduction of $437 million, 13 vessels in our fleet will become unencumbered. liquidity also stands very strong. as at the end of the first quarter we had $708 million in cash and marketable securities, while during the second quarter we received $239 million of charter hire prepayment related to charter contracts for 15 of our vessels, representing partial prepayment of charter hire payable during the period from may 2022 through january 2027. as a result of our actions, danaos has the strongest balance sheet in the industry, which will enable us to continue to pursue attractive opportunities when they arise for the benefit of our shareholders." three months ended march 31, 2022 compared to the three months ended march 31, 2021 during the three months ended march 31, 2022, danaos had an average of 71.0 containerships compared to 60.0 containerships during the three months ended march 31, 2021. our fleet utilization for the three months ended march 31, 2022 was 97.4% compared to 98.6% for the three months ended march 31, 2021. our adjusted net income amounted to $235.3 million, or $11.36 per share, for the three months ended march 31, 2022 compared to $58.0 million, or $2.83 per share, for the three months ended march 31, 2021. we have adjusted our net income in the three months ended march 31, 2022 for the change in fair value of our investment in zim integrated shipping services ltd. (“zim”) of $99.5 million and a non-cash fees amortization and accrued finance fees charge of $3.4 million. please refer to the adjusted net income reconciliation table, which appears later in this earnings release. the $177.3 million increase in adjusted net income for the three months ended march 31, 2022 compared to the three months ended march 31, 2021 is attributable mainly to a $97.8 million increase in operating revenues and recognition of a $110.0 million dividend from zim (net of withholding taxes), which were partially offset by a $22.9 million increase in total operating expenses, a $5.8 million increase in net finance expenses and a $1.8 million decrease in our equity income on investment in gemini shipholdings corporation (“gemini”) following our acquisition and full consolidation of gemini since july 1, 2021. on a non-adjusted basis, our net income amounted to $331.5 million, or $16.00 earnings per diluted share, for the three months ended march 31, 2022 compared to net income of $296.8 million, or $14.47 earnings per diluted share, for the three months ended march 31, 2021. our net income for the three months ended march 31, 2022 includes a total gain on our investment in zim of $209.5 million (net of withholding taxes on dividend). operating revenues operating revenues increased by 74.0%, or $97.8 million, to $229.9 million in the three months ended march 31, 2022 from $132.1 million in the three months ended march 31, 2021. operating revenues for the three months ended march 31, 2022 reflect: a $48.9 million increase in revenues in the three months ended march 31, 2022 compared to the three months ended march 31, 2021 mainly as a result of higher charter rates; a $20.8 million increase in revenues in the three months ended march 31, 2022 compared to the three months ended march 31, 2021 due to the incremental revenue generated by newly acquired vessels; a $11.4 million increase in revenue in the three months ended march 31, 2022 compared to the three months ended march 31, 2021 due to higher non-cash revenue recognition in accordance with us gaap; and a $16.7 million increase in revenues in the three months ended march 31, 2022 compared to the three months ended march 31, 2021 due to amortization of assumed time charters. vessel operating expenses vessel operating expenses increased by $8.1 million to $39.2 million in the three months ended march 31, 2022 from $31.1 million in the three months ended march 31, 2021, primarily as a result of the increase in the average number of vessels in our fleet and an increase in the average daily operating cost for vessels on time charter to $6,307 per vessel per day for the three months ended march 31, 2022 compared to $5,954 per vessel per day for the three months ended march 31, 2021. the average daily operating cost increased mainly due to the covid-19 related increase in crew remuneration and insurance expenses due to increased insured values of the vessels. management believes that our daily operating costs remain among the most competitive in the industry. depreciation & amortization depreciation & amortization includes depreciation and amortization of deferred dry-docking and special survey costs. depreciation depreciation expense increased by 29.5%, or $7.6 million, to $33.4 million in the three months ended march 31, 2022 from $25.8 million in the three months ended march 31, 2021 due to recent acquisitions of eleven vessels. amortization of deferred dry-docking and special survey costs amortization of deferred dry-docking and special survey costs increased by $0.2 million to $2.7 million in the three months ended march 31, 2022 from $2.5 million in the three months ended march 31, 2021. general and administrative expenses general and administrative expenses decreased by $3.5 million to $7.4 million in the three months ended march 31, 2022, from $10.9 million in the three months ended march 31, 2021. the decrease was mainly attributable to decreased stock-based compensation expenses. other operating expenses other operating expenses include voyage expenses. voyage expenses voyage expenses increased by $3.0 million to $7.2 million in the three months ended march 31, 2022 from $4.2 million in the three months ended march 31, 2021 primarily as a result of the increase in commissions due to the increase in revenue per vessel and the increase in the average number of vessels in our fleet. interest expense and interest income interest expense increased by 13.2%, or $2.0 million, to $17.1 million in the three months ended march 31, 2022 from $15.1 million in the three months ended march 31, 2021. the increase in interest expense is a combined result of: a $5.6 million reduction in the recognition through our income statement of accumulated accrued interest that had been accrued in 2018 in relation to two of our credit facilities that were refinanced on april 12, 2021. as a result of the refinancing, the recognition of such accumulated interest has decreased; a $2.1 million decrease in interest expense due to a decrease in our average indebtedness by $257.8 million between the two periods (average indebtedness of $1,356.7 million in the three months ended march 31, 2022, compared to average indebtedness of $1,614.5 million in the three months ended march 31, 2021), which was partially offset by an increase in our debt service cost by approximately 0.2%; and a $1.5 million decrease in the amortization of deferred finance costs and debt discount related to our 2018 debt refinancing. as of march 31, 2022, our outstanding debt, gross of deferred finance costs, was $1,118.6 million, which includes $300 million aggregate principal amount of our senior notes, and our leaseback obligation was $210.2 million. these balances compare to debt of $1,306.8 million and a leaseback obligation of $117.5 million as of march 31, 2021. see “recent developments” below. interest income decreased by $2.0 million to nil in the three months ended march 31, 2022 compared to $2.0 million in the three months ended march 31, 2021 mainly as a result of full collection of accrued interest on zim and hmm bonds, which were redeemed by the issuers thereof in the year 2021. gain on investments the gain on investments of $221.7 million in the three months ended march 31, 2022 consists of the change in fair value of our shareholding interest in zim of $99.5 million and dividends recognized on zim ordinary shares of $122.2 million. our remaining shareholding interest of 7,186,950 ordinary shares of zim has been fair valued at $522.6 million as of march 31, 2022, based on the closing price of zim’s ordinary shares on the nyse on that date. subsequently, in april 2022, we sold 1,500,000 of these zim ordinary shares resulting in proceeds to us of $85.3 million. equity income on investments equity income on investments in gemini decreased to nil in the three months ended march 31, 2022 compared to $1.8 million in the three months ended march 31, 2021 following our acquisition and full consolidation of gemini since july 1, 2021. other finance expenses, net other finance expenses, net increased by $0.1 million to $0.6 million in the three months ended march 31, 2022 compared to $0.5 million in the three months ended march 31, 2021. loss on derivatives amortization of deferred realized losses on interest rate swaps remained stable at $0.9 million in each of the three months ended march 31, 2022 and march 31, 2021. other income, net other income, net was $0.5 million in the three months ended march 31, 2022 compared to $4.0 million in the three months ended march 31, 2021. the decrease was mainly due to the collection from hanjin shipping of $3.9 million as a partial payment of common benefit claim and interest in the three months ended march 31, 2021. income taxes income taxes were $12.2 million in the three months ended march 31, 2022, related to the taxes withheld on dividend income earned on zim ordinary shares and compared to no income tax in the three months ended march 31, 2021. adjusted ebitda adjusted ebitda increased by 179.9%, or $173.2 million, to $269.5 million in the three months ended march 31, 2022 from $96.3 million in the three months ended march 31, 2021. as outlined above, the increase is mainly attributable to a $81.1 million increase in operating revenues (net of $16.7 million amortization of assumed time charters) and recognition of a $110.0 million dividend from zim (net of withholding taxes) in the three months ended march 31, 2022, which were partially offset by a $16.1 million increase in total operating expenses and a $1.8 million decrease in equity investment in gemini following our acquisition and full consolidation since july 1, 2021. adjusted ebitda for the three months ended march 31, 2022 is adjusted for a $111.8 million change in fair value of the investment in zim and dividend withholding taxes and stock-based compensation of $0.1 million. tables reconciling adjusted ebitda to net income can be found at the end of this earnings release. dividend payment danaos has declared a dividend of $0.75 per share of common stock for the first quarter of 2022, which is payable on june 8, 2022 to stockholders of record as of may 27, 2022. recent developments in march 2022, we entered into an agreement to build two 7,100 teu container vessels in dalian shipbuilding in china for a contracted price of $156 million and in april 2022, we entered into an agreement to build four 8,000 teu container vessels in daehan shipbuilding in south korea for a contracted price of $372.7 million. all these fuel-efficient vessels are expected to be delivered to us in 2024. in april 2022, we sold 1,500,000 ordinary shares of zim resulting in proceeds of $85.3 million. on may 12, 2022, we early extinguished our leasing obligation amounting to $97.4 million as of march 31, 2022 related to the vessels cma cgm melisande, cma cgm attila, cma cgm tancredi, cma cgm bianca and cma cgm samson and we also early extinguished $270.0 million of the outstanding natwest loan principal of the citibank/natwest $815 mil. facility, which reduced the future quarterly installments of the remaining facility to $12.9 million and the balloon payment at maturity was reduced to $309.0 million. additionally, on may 12, 2022, we sent notice of early full repayment to our lenders related to (i) $43 million loan outstanding with the macquarie bank to be fully repaid on june 30, 2022, (ii) $20.55 million loan outstanding with eurobank to be fully repaid on may 25, 2022 and (iii) $9.8 million loan outstanding with sinopac to be fully repaid on july 1, 2022. in april 2022, we entered into a preliminary term sheet agreement for a $130.0 million loan facility with major financial institutions, subject to final documentation, which will be secured by our six 5,466 teu sister vessels acquired in 2021. this facility is expected to be drawn down in the 2nd quarter of 2022. conference call and webcast on tuesday, may 16, 2022 at 9:00 a.m. et, the company's management will host a conference call to discuss the results. participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1 844 802 2437 (us toll free dial in), 0800 279 9489 (uk toll free dial in) or +44 (0) 2075 441 375 (standard international dial in). please indicate to the operator that you wish to join the danaos corporation earnings call. a telephonic replay of the conference call will be available until may 24, 2021 by dialing 1 877 344 7529 (us toll free dial in) or 1-412-317-0088 (standard international dial in) and using 2700349# as the access code. audio webcast there will also be a live and then archived webcast of the conference call on the danaos website (www.danaos.com). participants of the live webcast should register on the website approximately 10 minutes prior to the start of the webcast. slide presentation a slide presentation regarding the company and the containership industry will also be available on the danaos website (www.danaos.com). about danaos corporation danaos corporation is one of the largest independent owners of modern, large-size containerships. our current fleet of 71 containerships aggregating 436,589 teus and 6 under construction containerships aggregating 46,200 teus ranks danaos among the largest containership charter owners in the world based on total teu capacity. our fleet is chartered to many of the world's largest liner companies on fixed-rate charters. our long track record of success is predicated on our efficient and rigorous operational standards and environmental controls. danaos corporation'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 safe harbor 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. 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 impact of the covid-19 pandemic and efforts throughout the world to contain its spread, including effects on global economic activity, demand for seaborne transportation of containerized cargo, the ability and willingness of charterers to perform their obligations to us, charter rates for containerships, shipyards performing scrubber installations, drydocking and repairs, changing vessel crews and availability of financing; danaos’ ability to achieve the expected benefits of the 2021 debt refinancing and comply with the terms of its new credit facilities and other financing agreements; the strength of world economies and currencies, general market conditions, including changes in charter hire rates and vessel values, charter counterparty performance, changes in demand that may affect attitudes of time charterers to scheduled and unscheduled dry-docking, 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, including the conflict in ukraine and related sanctions, 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 16 unscheduled off-hire days in the three months ended march 31, 2022. the following table summarizes vessel utilization and the impact of the off-hire days on the company’s revenue. vessel utilization (no. of days) first quarter first quarter 2022 2021 ownership days 6,390 5,400 less off-hire days: scheduled off-hire days (148) (22) other off-hire days (16) (51) operating days 6,226 5,327 vessel utilization 97.4% 98.6% operating revenues (in '000s of us dollars) $229,901 $132,118 average gross daily charter rate $36,926 $24,802 fleet list the following table describes in detail our fleet deployment profile as of may 16, 2022: vessel name vessel size (teu) year built expiration of charter(1) hyundai ambition 13,100 2012 june 2024 hyundai speed 13,100 2012 june 2024 hyundai smart 13,100 2012 may 2024 hyundai respect 13,100 2012 march 2024 hyundai honour 13,100 2012 february 2024 express rome 10,100 2011 march 2023 express berlin 10,100 2011 june 2023 express athens 10,100 2011 march 2023 le havre 9,580 2006 june 2028 pusan c 9,580 2006 may 2028 bremen 9,012 2009 january 2028 c hamburg 9,012 2009 january 2028 niledutch lion 8,626 2008 may 2026 kota manzanillo (ex charleston) 8,533 2005 february 2026 belita 8,533 2006 july 2026 cma cgm melisande 8,530 2012 may 2024 cma cgm attila 8,530 2011 october 2023 cma cgm tancredi 8,530 2011 november 2023 cma cgm bianca 8,530 2011 january 2024 cma cgm samson 8,530 2011 march 2024 america 8,468 2004 april 2028 europe 8,468 2004 may 2028 phoebe 8,463 2005 august 2026 cma cgm moliere 6,500 2009 march 2027 cma cgm musset 6,500 2010 october 2022 cma cgm nerval 6,500 2010 december 2022 cma cgm rabelais 6,500 2010 february 2023 cma cgm racine 6,500 2010 march 2023 ym mandate 6,500 2010 january 2028 ym maturity 6,500 2010 april 2028 catherine c 6,422 2001 november 2022 leo c 6,422 2002 november 2022 zim savannah 6,402 2002 may 2024 dimitra c 6,402 2002 january 2023 suez canal 5,610 2002 march 2023 kota lima 5,544 2002 november 2024 wide alpha 5,466 2014 march 2024 wide bravo 5,466 2014 june 2025 maersk euphrates 5,466 2014 april 2024 wide hotel 5,466 2015 may 2024 wide india 5,466 2015 september 2025 wide juliet 5,466 2015 june 2023 seattle c 4,253 2007 october 2024 vancouver 4,253 2007 november 2024 derby d 4,253 2004 january 2027 tongala 4,253 2004 january 2023 rio grande 4,253 2008 november 2024 zim sao paolo 4,253 2008 february 2023 zim kingston 4,253 2008 april 2023 zim monaco 4,253 2009 february 2023 dalian 4,253 2009 november 2022 zim luanda 4,253 2009 august 2025 dimitris c 3,430 2001 november 2025 express black sea 3,400 2011 january 2025 express spain 3,400 2011 january 2025 express argentina 3,400 2010 may 2023 express brazil 3,400 2010 june 2025 express france 3,400 2010 september 2025 singapore 3,314 2004 may 2024 colombo 3,314 2004 january 2025 zebra 2,602 2001 november 2024 amalia c 2,452 1998 january 2023 artotina 2,524 2001 april 2025 advance 2,200 1997 january 2025 future 2,200 1997 december 2024 sprinter 2,200 1997 december 2024 stride 2,200 1997 january 2025 progress c 2,200 1998 november 2024 bridge 2,200 1998 december 2024 highway 2,200 1998 august 2022 vladivostok 2,200 1997 march 2025 vessels under construction hull no. c7100-7 7,100 2024 hull no. c7100-8 7,100 2024 hull no. hn4009 8,000 2024 hull no. hn4010 8,000 2024 hull no. hn4011 8,000 2024 hull no. hn4012 8,000 2024 (1) earliest date charters could expire. some charters include options for the charterer to extend their terms. danaos corporation condensed consolidated statements of income - unaudited (expressed in thousands of united states dollars, except per share amounts) three months ended three months ended march 31, march 31, 2022 2021 operating revenues $229,901 $132,118 operating expenses vessel operating expenses (39,164) (31,078) depreciation & amortization (36,079) (28,308) general & administrative (7,391) (10,895) other operating expenses (7,189) (4,228) income from operations 140,078 57,609 other income/(expenses) interest income 1 1,978 interest expense (17,114) (15,111) gain on investments 221,717 247,875 other finance expenses (605) (452) equity income on investments - 1,803 other income, net 499 3,971 realized loss on derivatives (893) (893) total other income/(expenses), net 203,605 239,171 income before income taxes 343,683 296,780 income taxes (12,218) - net income $331,465 $296,780 earnings per share basic earnings per share $16.02 $14.62 diluted earnings per share $16.00 $14.47 basic weighted average number of common shares (in thousands of shares) 20,697 20,293 diluted weighted average number of common shares (in thousands of shares) 20,717 20,513 non-gaap measures1 reconciliation of net income to adjusted net income – unaudited three months ended three months ended march 31, march 31, 2022 2021 net income $331,465 $296,780 change in fair value of investments (99,539) (247,875) amortization of financing fees, debt discount & finance fees accrued 3,371 5,028 stock based compensation - 4,078 adjusted net income $235,297 $58,011 adjusted earnings per share, diluted $11.36 $2.83 diluted weighted average number of shares (in thousands) 20,717 20,513 1 the 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 table above for supplemental financial data and corresponding reconciliations to gaap financial measures for the three months ended march 31, 2022 and 2021. 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. danaos corporation condensed consolidated balance sheets - unaudited (expressed in thousands of united states dollars) as of as of march 31, december 31, 2022 2021 assets current assets cash, cash equivalents and restricted cash $198,664 $129,756 accounts receivable, net 7,133 7,118 other current assets 716,825 495,618 922,622 632,492 non-current assets fixed assets, net 2,909,777 2,941,093 deferred charges, net 18,336 11,801 other non-current assets 53,486 41,739 2,981,599 2,994,633 total assets $3,904,221 $3,627,125 liabilities and stockholders' equity current liabilities long-term debt, current portion $94,150 $95,750 accumulated accrued interest, current portion 7,911 6,146 long-term leaseback obligations, current portion 86,116 85,815 accounts payable, accrued liabilities & other current liabilities 134,344 131,596 322,521 319,307 long-term liabilities long-term debt, net 998,052 1,017,916 accumulated accrued interest, net of current portion 20,955 24,155 long-term leaseback obligations, net 120,454 136,513 other long-term liabilities 37,271 41,211 1,176,732 1,219,795 stockholders’ equity common stock 207 207 additional paid-in capital 770,800 770,676 accumulated other comprehensive loss (70,562) (71,455) retained earnings 1,704,523 1,388,595 2,404,968 2,088,023 total liabilities and stockholders' equity $3,904,221 $3,627,125 danaos corporation condensed consolidated statements of cash flows - unaudited (expressed in thousands of united states dollars) three months ended three months ended march 31, march 31, 2022 2021 operating activities: net income $331,465 $296,780 adjustments to reconcile net income to net cash provided by operating activities: depreciation and amortization of right-of-use assets 33,359 25,799 amortization of deferred drydocking & special survey costs, finance cost, debt discount and other finance fees accrued 6,091 7,537 amortization of assumed time charters (16,651) - pik interest - 642 gain on investments (99,539) (247,875) payments for drydocking/special survey (9,255) (907) amortization of deferred realized losses on cash flow interest rate swaps 893 893 equity income on investments - (1,803) stock based compensation 124 4,909 accounts receivable (15) 213 other assets, current and non-current (133,417) 1,002 accounts payable and accrued liabilities 5,641 3,278 other liabilities, current and long-term 768 (2,210) net cash provided by operating activities 119,464 88,258 investing activities: vessel additions and advances (2,043) (1,236) advances for sale of vessels 13,000 - investments - 2,392 net cash provided by investing activities 10,957 1,156 financing activities: proceeds from long-term debt - 294,386 debt repayment (24,300) (71,849) payments of leaseback obligations (16,293) (5,916) dividends paid (15,535) - payments of accumulated accrued interest (1,435) (4,702) finance costs (3,950) (4,488) net cash provided by/(used in) financing activities (61,513) 207,431 net increase in cash, cash equivalents and restricted cash 68,908 296,845 cash, cash equivalents and restricted cash, beginning of period 129,756 65,663 cash, cash equivalents and restricted cash, end of period $198,664 $362,508 danaos corporation reconciliation of net income to adjusted ebitda - unaudited (expressed in thousands of united states dollars) three months ended three months ended march 31, march 31, 2022 2021 net income $331,465 $296,780 depreciation and amortization of right-of-use assets 33,359 25,799 amortization of deferred drydocking & special survey costs 2,720 2,509 amortization of assumed time charters (16,651) - amortization of deferred finance costs, debt discount and other finance fees accrued 3,371 5,028 amortization of deferred realized losses on interest rate swaps 893 893 interest income (1) (1,978) interest expense 13,743 10,217 income taxes 12,218 - gain on investments and dividend withholding taxes (111,757) (247,875) stock based compensation 124 4,909 adjusted ebitda(1) $269,484 $96,282 (1) adjusted ebitda represents net income before interest income and expense, taxes other than withholding taxes on dividend, depreciation, amortization of deferred drydocking & special survey costs, amortization of assumed time charters, amortization of deferred finance costs, debt discount and other finance fees accrued, amortization of deferred realized losses on interest rate swaps, gain on investments, equity income on investments, gain on debt extinguishment and stock based compensation. however, adjusted ebitda is not a recognized measurement under u.s. generally accepted accounting principles, or “gaap.” we believe that the presentation of adjusted 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 adjusted ebitda is useful in evaluating our operating performance compared to that of other companies in our industry because the calculation of adjusted 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. in evaluating adjusted ebitda, you should be aware that in the future we may incur expenses that are the same as or similar to some of the adjustments in this presentation. our presentation of adjusted ebitda should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. note: items to consider for comparability include gains and charges. gains positively impacting net income are reflected as deductions to net income. charges negatively impacting net income are reflected as increases to net income. the 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 these 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 three months ended march 31, 2022 and 2021. 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.
