Danaos corporation reports results for the fourth quarter and year ended december 31, 2020
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 fourth quarter and the year ended december 31, 2020. highlights for the fourth quarter and year ended december 31, 2020: adjusted net income1 of $47.8 million, or $2.29 per share, for the three months ended december 31, 2020 compared to $38.0 million, or $2.01 per share, for the three months ended december 31, 2019, an increase of 25.8%. adjusted net income1 of $170.9 million, or $7.18 per share, for the year ended december 31, 2020 compared to $148.7 million, or $9.17 per share, for the year ended december 31, 2019, an increase of 14.9%. operating revenues of $119.6 million for the three months ended december 31, 2020 compared to $110.2 million for the three months ended december 31, 2019, an increase of 8.5%. operating revenues of $461.6 million for the year ended december 31, 2020 compared to $447.2 million for the year ended december 31, 2019, an increase of 3.2%. adjusted ebitda1 of $83.0 million for the three months ended december 31, 2020 compared to $78.1 million for the three months ended december 31, 2019, an increase of 6.3%. adjusted ebitda1 of $318.3 million for the year ended december 31, 2020 compared to $310.6 million for the year ended december 31, 2019, an increase of 2.5%. total contracted operating revenues were $1.2 billion2 as of december 31, 2020, with charters extending through 2028 and remaining average contracted charter duration of 3.1 years, weighted by aggregate contracted charter hire. charter coverage of 94% for the next 12 months based on current operating revenues and 91% in terms of contracted operating days. three months and year ended december 31, 2020 financial summary - unaudited (expressed in thousands of united states dollars, except per share amounts) three months ended three months ended year ended year ended december 31, december 31, december 31, december 31, 2020 2019 2020 2019 operating revenues $119,642 $110,204 $461,594 $447,244 net income $43,179 $33,817 $153,550 $131,253 adjusted net income1 $47,810 $37,969 $170,888 $148,675 earnings per share, diluted $2.07 $1.79 $6.45 $8.09 adjusted earnings per share, diluted1 $2.29 $2.01 $7.18 $9.17 diluted weighted average number of shares (in thousands) 20,874 18,927 23,805 16,221 adjusted ebitda1 $83,009 $78,118 $318,331 $310,565 1. adjusted net income, adjusted earnings per share and adjusted ebitda are non-gaap measures. please refer to the reconciliation of net income to adjusted net income and net income to adjusted ebitda. 2. contracted revenue as of december 31, 2020 on the basis of concluded charter contracts through february 15, 2021. danaos’ ceo dr. john coustas commented: "in the fourth quarter of 2020, we witnessed the most outstanding turnaround in the container industry for as long as i can remember. market participants were caught by surprise as the chronic underinvestment in capacity coupled with a sudden resurgence of demand created a spike that drove container box rates to all-time highs. this led to a massive increase in our customers’ profitability and significantly diminished the counterparty risk that was so prevalent at the end of the first quarter of 2020. the charter market, in turn, rapidly strengthened, resulting in decade-high charter rates across almost all vessel types. now everyone is focused on whether the current market strength is sustainable and for how long. fortunately, incremental vessel supply will remain low for the time being. although there have been new orders placed, the current orderbook is at historically low levels. since there is a two-year lead time for new orders to hit the water, supply growth should be moderate for the next couple of years. what will happen next depends a lot on the environmental initiatives, regulations and of course demand. as far as danaos is concerned we experienced a strong quarter, completed delivery of all contracted vessels, realized significant gains, displayed exceptional rechartering performance and entered into agreements for a very important refinancing. this quarter we saw an improvement in adjusted ebitda and adjusted net income compared to the same quarter in the prior year. this improvement should be even more pronounced in the coming quarters as new contracted charters at significantly higher rates start to contribute to our top line. we have concluded 27 recharterings over the past three months for periods of 12-24 months at rates between two and three times the rates of the expiring charters. in doing so, we have practically covered 91% of our 2021 operating days and a significant portion of our 2022 operating days. we currently expect revenue in 2021 to exceed 2020 revenue by at least $100 million. the recent performance of both zim and hmm has resulted in a $23.8 million increase in the recorded value of our bond holdings in these two companies, which increased in value to approximately $63 million as of the end of 2020. the zim ipo has also provided a marked-to-market value for our 10.2mn shares in zim, which have a value exceeding $200 million based on zim’s closing share price of $20.12 per share on february 12, 2021. these shares were valued at $75,000 as of the end of 2020. we have also recently concluded a $300 million bond offering, which was over three times oversubscribed, an extraordinary accomplishment for a first-time issuer. these funds, together with another $950 million of bank and lease financing, will be used to refinance most of our existing credit facilities and form the basis of our new strategy as we will not have any maturities until 2025. we are happy that the market has acknowledged our accomplishments, leading to a dramatic outperformance of our share price as compared to our peers. we are well-positioned and committed to continue to take actions to create value for our shareholders." three months ended december 31, 2020 compared to the three months ended december 31, 2019 during the three months ended december 31, 2020, danaos had an average of 58.5 containerships compared to 55.0 containerships during the three months ended december 31, 2019. our fleet utilization for the three months ended december 31, 2020 was 97.9% compared to 97.0% for the three months ended december 31, 2019. our adjusted net income amounted to $47.8 million, or $2.29 per share, for the three months ended december 31, 2020 compared to $38.0 million, or $2.01 per share, for the three months ended december 31, 2019. we have adjusted our net income in the three months ended december 31, 2020 for amortization of non-cash fees and accrued finance fees charges of $4.6 million. please refer to the adjusted net income reconciliation table, which appears later in this earnings release. the increase of $9.8 million in adjusted net income for the three months ended december 31, 2020 compared to the three months ended december 31, 2019 is attributable mainly to a $9.4 million increase in operating revenues, a $6.0 million decrease in net finance expenses and a $0.5 million increase in the operating performance of our equity investment in gemini shipholdings corporation (“gemini”), which were partially offset by a $6.1 million increase in total operating expenses. on a non-adjusted basis, our net income amounted to $43.2 million, or $2.07 earnings per diluted share, for the three months ended december 31, 2020 compared to net income of $33.8 million, or $1.79 earnings per diluted share, for the three months ended december 31, 2019. operating revenues operating revenues increased by 8.5%, or $9.4 million, to $119.6 million in the three months ended december 31, 2020 from $110.2 million in the three months ended december 31, 2019. operating revenues for the three months ended december 31, 2020 reflect: a $7.6 million increase in revenues in the three months ended december 31, 2020 compared to the three months ended december 31, 2019 mainly as a result of contractual increases in charter rates of vessels under long-term charters, partially offset by lower re-chartering rates between the two quarters for certain of our vessels; a $6.1 million increase in revenues in the three months ended december 31, 2020 compared to the three months ended december 31, 2019 due to the acquisition of new vessels; a $2.1 million increase in revenues due to higher fleet utilization of our vessels in the three months ended december 31, 2020 compared to the three months ended december 31, 2019. a $6.4 million decrease in revenues in the three months ended december 31, 2020 compared to the three months ended december 31, 2019 due to lower non-cash revenue recognition in accordance with us gaap; and vessel operating expenses vessel operating expenses increased by $4.2 million to $28.7 million in the three months ended december 31, 2020 from $24.5 million in the three months ended december 31, 2019, primarily as a result of the increase in the average number of vessels in our fleet and an overall increase in the average daily operating cost to $5,571 per vessel per day for vessels on time charter for the three months ended december 31, 2020 compared to $5,215 per vessel per day for the three months ended december 31, 2019. management believes that our daily operating costs are 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 6.1%, or $1.5 million, to $25.9 million in the three months ended december 31, 2020 from $24.4 million in the three months ended december 31, 2019 mainly due to the acquisition of the vessels niledutch lion, phoebe, charleston, bremen and c hamburg and the installation of scrubbers on nine of our vessels in the year ended december 31, 2020. amortization of deferred dry-docking and special survey costs amortization of deferred dry-docking and special survey costs increased by $0.4 million to $2.6 million in the three months ended december 31, 2020 from $2.2 million in the three months ended december 31, 2019. general and administrative expenses general and administrative expenses decreased by $0.6 million to $6.4 million in the three months ended december 31, 2020, from $7.0 million in the three months ended december 31, 2019. the decrease was mainly due to decreased non-cash recognition of share-based compensation. other operating expenses other operating expenses include voyage expenses. voyage expenses voyage expenses increased by $0.6 million to $3.4 million in the three months ended december 31, 2020 from $2.8 million in the three months ended december 31, 2019 primarily as a result of the increase in the average number of vessels in our fleet. interest expense and interest income interest expense decreased by 32.2%, or $5.5 million, to $11.6 million in the three months ended december 31, 2020 from $17.1 million in the three months ended december 31, 2019. the decrease in interest expense is attributable to: a $6.0 million decrease in interest expense due to a decrease in debt service cost of approximately 2% and a $92.6 million decrease in our average debt (including leaseback obligations), to $1,482.5 million in the three months ended december 31, 2020, compared to $1,575.1 million in the three months ended december 31, 2019; and a $0.5 million increase in the amortization of deferred finance costs and debt discount related to our 2018 debt refinancing. as of december 31, 2020, our outstanding bank debt, gross of deferred finance costs, was $1,368.1 million and our leaseback obligation was $123.4 million compared to bank debt of $1,423.8 million and our leaseback obligation of $138.2 million as of december 31, 2019. interest income remained stable at $1.7 million in each of the three months ended december 31, 2020 and december 31, 2019. other finance costs, net other finance costs, net remained stable at $0.3 million in each of the three months ended december 31, 2020 and december 31, 2019. equity income on investments equity income on investments increased by $0.5 million to $1.6 million of income on investments in the three months ended december 31, 2020 compared to $1.1 million in the three months ended december 31, 2019 due to the improved operating performance of gemini, in which the company has a 49% shareholding interest. 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 december 31, 2020 and december 31, 2019. other income, net other income, net was $0.2 million in the three months ended december 31, 2020 compared to $0.1 million in the three months ended december 31, 2019. adjusted ebitda adjusted ebitda increased by 6.3%, or $4.9 million, to $83.0 million in the three months ended december 31, 2020 from $78.1 million in the three months ended december 31, 2019. as outlined above, the increase is mainly attributable to a $9.4 million increase in operating revenues and a $0.5 million increase in the operating performance of our equity investees, which were partially offset by a $5.0 million increase in total operating expenses. adjusted ebitda for the three months ended december 31, 2020 is adjusted for stock-based compensation of $0.3 million. tables reconciling adjusted ebitda to net income can be found at the end of this earnings release. year ended december 31, 2020 compared to the year ended december 31, 2019 during the year ended december 31, 2020, danaos had an average of 57.3 containerships compared to 55.0 containerships during the year ended december 31, 2019. our fleet utilization for the year ended december 31, 2020 was 96.3% compared to 98.3% for the year ended december 31, 2019. adjusted fleet utilization, excluding the effect of 188 days of incremental off-hire due to shipyard delays related to the covid-19 pandemic, was 97.2% in the year ended december 31, 2020. our adjusted net income amounted to $170.9 million, or $7.18 per share, for the year ended december 31, 2020 compared to $148.7 million, or $9.17 per share, for the year ended december 31, 2019. we have adjusted our net income in the year ended december 31, 2020 for amortization of non-cash fees and accrued finance fees charge of $17.3 million. please refer to the adjusted net income reconciliation table, which appears later in this earnings release. the increase of $22.2 million in adjusted net income for the year ended december 31, 2020 compared to the year ended december 31, 2019 is attributable mainly to a $19.1 million decrease in net finance expenses, a $14.4 million increase in operating revenues and a $4.7 million increase in the operating performance of our equity investment in gemini, which were partially offset by a $16.0 million increase in total operating expenses. on a non-adjusted basis, our net income amounted to $153.6 million, or $6.45 earnings per diluted share, for the year ended december 31, 2020 compared to net income of $131.3 million, or $8.09 earnings per diluted share, for the year ended december 31, 2019. operating revenues operating revenues increased by 3.2%, or $14.4 million, to $461.6 million in the year ended december 31, 2020 from $447.2 million in the year ended december 31, 2019. operating revenues for the year ended december 31, 2020 reflect: a $24.5 million increase in revenues in the year ended december 31, 2020 compared to the year ended december 31, 2019 mainly as a result of contractual increases in charter rates of vessels under long-term charters, partially offset by lower re-chartering rates between the two quarters for certain of our vessels; a $16.1 million increase in revenues in the year ended december 31, 2020 compared to the year ended december 31, 2019 due to the acquisition of new vessels; a $22.2 million decrease in revenues in the year ended december 31, 2020 compared to the year ended december 31, 2019 due to lower non-cash revenue recognition in accordance with us gaap; and a $4.0 million decrease in revenues due to lower fleet utilization of our vessels in the year ended december 31, 2020 compared to the year ended december 31, 2019 mainly due to the scheduled installation of scrubbers and dry-dockings of our vessels, of which $3.2 million relates to incremental delays in the chinese shipyards where these activities were being performed due to the covid-19 pandemic. vessel operating expenses vessel operating expenses increased by $8.4 million to $110.9 million in the year ended december 31, 2020 from $102.5 million in the year ended december 31, 2019, primarily as a result of the increase in the average number of vessels in our fleet and an overall increase in the average daily operating cost to $5,586 per vessel per day for vessels on time charter for the year ended december 31, 2020 compared to $5,506 per vessel per day for the year ended december 31, 2019. management believes that our daily operating costs are 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 5.2%, or $5.0 million, to $101.5 million in the year ended december 31, 2020 from $96.5 million in the year ended december 31, 2019 mainly due to the acquisition of the vessels niledutch lion, phoebe, charleston, bremen and c hamburg and the installation of scrubbers on nine of our vessels in the year ended december 31, 2020. amortization of deferred dry-docking and special survey costs amortization of deferred dry-docking and special survey costs increased by $2.3 million to $11.0 million in the year ended december 31, 2020 from $8.7 million in the year ended december 31, 2019. general and administrative expenses general and administrative expenses decreased by $2.5 million to $24.3 million in the year ended december 31, 2020, from $26.8 million in the year ended december 31, 2019. the decrease was mainly due to decreased non-cash recognition of share-based compensation. other operating expenses other operating expenses include voyage expenses. voyage expenses voyage expenses increased by $2.7 million to $14.3 million in the year ended december 31, 2020 from $11.6 million in the year ended december 31, 2019 primarily as a result of the increase in the average number of vessels in our fleet. interest expense and interest income interest expense decreased by 25.8%, or $18.6 million, to $53.5 million in the year ended december 31, 2020 from $72.1 million in the year ended december 31, 2019. the decrease in interest expense is due to a decrease in debt service cost by approximately 1.5% and a $96.1 million decrease in our average debt (including leaseback obligations), to $1,519.9 million in the year ended december 31, 2020, compared to $1,616.0 million in the year ended december 31, 2019. as of december 31, 2020, our outstanding bank debt, gross of deferred finance costs, was $1,368.1 million and our leaseback obligation was $123.4 million compared to bank debt of $1,423.8 million and our leaseback obligation of $138.2 million as of december 31, 2019. interest income increased by $0.2 million to $6.6 million in the year ended december 31, 2020 compared to $6.4 million in the year ended december 31, 2019. other finance costs, net other finance costs, net decreased by $0.4 million to $2.3 million in the year ended december 31, 2020 compared to $2.7 million in the year ended december 31, 2019 mainly due to the decrease in finance costs related to the leaseback obligations, partially offset by lease termination fees in the year ended december 31, 2020. equity income on investments equity income on investments increased by $4.7 million to $6.3 million of income on investments in the year ended december 31, 2020 compared to $1.6 million in the year ended december 31, 2019 due to the improved operating performance of gemini, in which the company has a 49% shareholding interest. loss on derivatives amortization of deferred realized losses on interest rate swaps remained stable at $3.6 million in each of the years ended december 31, 2020 and december 31, 2019. other income, net other income, net was remained stable at $0.6 million in each of the years ended december 31, 2020 and december 31, 2019. adjusted ebitda adjusted ebitda increased by 2.5%, or $7.7 million, to $318.3 million in the year ended december 31, 2020 from $310.6 million in the year ended december 31, 2019. as outlined above, the increase is mainly attributable to a $14.4 million increase in operating revenues and a $4.7 million increase in the operating performance of our equity investees, which were partially offset by a $11.4 million increase in operating expenses. adjusted ebitda for the year ended december 31, 2020 is adjusted for stock-based compensation of $1.2 million. tables reconciling adjusted ebitda to net income can be found at the end of this earnings release. recent developments on february 4, 2021 we announced the pricing of our offering of $300 million of 8.500% senior unsecured notes due 2028. we intend to use the net proceeds from the offering, together with a new $815 million senior secured credit facility and a new $135 million sale leaseback arrangement, to implement a $1.25 billion refinancing of a substantial majority of our outstanding senior secured indebtedness. the offering closed on february 11, 2021. on january 27, 2021, zim completed its initial public offering and listing on the new york stock exchange of its ordinary shares. we currently own 10,186,950 ordinary shares of zim, which shareholding interest was valued at $205.0 million as of february 12, 2021 (based on the last reported trading price of zim’s ordinary shares on the nyse) and recorded at a book value of $75 thousand as of december 31, 2020. on january 20, 2021 we received $3.9 million from hanjin shipping as a partial payment of common benefit claim applied to the unpaid charter hires plus other outstandings and interest for the period from the date of hanjin shipping’s filing for bankruptcy until the termination notices for each respective charterparty. on february 12, 2021, the board and the compensation committee awarded 150,000 shares of common stock to officers and directors of the company and employees of our manager, danaos shipping co. ltd., under the auspices of the company’s equity compensation plan. in december 2020 we took delivery of the two 9,012 teu container vessels built in 2009 bremen and c hamburg. conference call and webcast on tuesday, february 16, 2021 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 february 23, 2021 by dialing 1 877 344 7529 (us toll free dial in) or 1-412-317-0088 (standard international dial in) and using 10152390# 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 65 containerships aggregating 403,793 teus, including five vessels owned by gemini shipholdings corporation, a joint venture, 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; the effects of the 2018 refinancing transactions; danaos’ ability to achieve the expected benefits of the refinancing and comply with the terms of its new credit facilities and other agreements entered into in connection with the 2018 refinancing; our ability to consummate our contemplated debt refinancing in 2021 and achieve the expected benefits of such debt refinancing; 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, 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 30 unscheduled off-hire days in the three months ended december 31, 2020. 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 second quarter third quarter fourth quarter 2020 2020 2020 2020 total ownership days 5,073 5,193 5,336 5,380 20,982 less off-hire days: scheduled off-hire days (336) (60) (10) (81) (487) other off-hire days (104) (92) (60) (30) (286) operating days 4,633 5,041 5,266 5,269 20,209 vessel utilization 91.3% 97.1% 98.7% 97.9% 96.3% operating revenues (in '000s of us dollars) $106,196 $116,824 $118,932 $119,642 $461,594 average gross daily charter rate $22,922 $23,175 $22,585 $22,707 $22,841 vessel utilization (no. of days) first quarter second quarter third quarter fourth quarter 2019 2019 2019 2019 total ownership days 4,950 5,005 5,060 5,060 20,075 less off-hire days: scheduled off-hire days - (22) (41) (123) (186) other off-hire days (90) (10) (24) (29) (153) operating days 4,860 4,973 4,995 4,908 19,736 vessel utilization 98.2% 99.4% 98.7% 97.0% 98.3% operating revenues (in '000s of us dollars) $112,891 $112,319 $111,830 $110,204 $447,244 average gross daily charter rate $23,229 $22,586 $22,388 $22,454 $22,661 fleet list the following table describes in detail our fleet deployment profile as of february 15, 2021: vessel name vessel size (teu) year built expiration of charter(1) hyundai ambition (ex msc ambition) 13,100 2012 june 2024 hyundai speed (ex maersk exeter) 13,100 2012 june 2024 hyundai smart (ex maersk enping) 13,100 2012 may 2024 hyundai respect 13,100 2012 march 2024 hyundai honour 13,100 2012 february 2024 express rome 10,100 2011 february 2022 express berlin 10,100 2011 april 2022 express athens 10,100 2011 february 2022 le havre 9,580 2006 april 2023 pusan c 9,580 2006 march 2023 bremen (ex cpo bremen) 9,012 2009 december 2022 c hamburg (ex cpo hamburg) 9,012 2009 january 2023 niledutch lion 8,626 2008 february 2022 charleston (ex sm charleston) 8,533 2005 december 2021 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 february 2023 europe 8,468 2004 march 2023 phoebe 8,463 2005 april 2022 cma cgm moliere 6,500 2009 february 2022 cma cgm musset 6,500 2010 august 2022 cma cgm nerval 6,500 2010 october 2022 cma cgm rabelais 6,500 2010 december 2022 cma cgm racine 6,500 2010 january 2023 ym mandate 6,500 2010 january 2028 ym maturity 6,500 2010 april 2028 performance 6,402 2002 june 2021 dimitra c 6,402 2002 january 2023 seattle c 4,253 2007 september 2021 ym vancouver 4,253 2007 december 2021 derby d 4,253 2004 january 2022 anl tongala 4,253 2004 march 2021 rio grande (ex zim rio grande) 4,253 2008 december 2021 zim sao paolo 4,253 2008 february 2023 zim kingston 4,253 2008 april 2023 zim monaco 4,253 2009 july 2022 zim dalian 4,253 2009 november 2022 zim luanda 4,253 2009 may 2021 dimitris c 3,430 2001 january 2022 express black sea 3,400 2011 january 2022 express spain 3,400 2011 january 2022 express argentina 3,400 2010 march 2021 express brazil 3,400 2010 september 2021 express france 3,400 2010 october 2021 singapore 3,314 2004 october 2021 colombo 3,314 2004 december 2021 zebra (ex msc zebra) 2,602 2001 august 2021 amalia c 2,452 1998 may 2021 danae c 2,524 2001 february 2022 advance 2,200 1997 january 2022 future 2,200 1997 november 2021 sprinter 2,200 1997 december 2021 stride 2,200 1997 february 2022 progress c 2,200 1998 december 2021 bridge 2,200 1998 april 2022 highway 2,200 1998 march 2021 vladivostok 2,200 1997 october 2021 belita Ľ2) 8,533 2006 september 2021 catherine c (2) 6,422 2001 january 2023 leo c (2) 6,422 2002 august 2022 suez canal(2) 5,610 2002 march 2023 genoaĽ2) 5,544 2002 september 2021 earliest date charters could expire. some charters include options to extend their terms. vessels acquired by gemini shipholdings corporation, in which danaos holds a 49% equity interest. 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 year ended year ended december 31, december 31, december 31, december 31, 2020 2019 2020 2019 operating revenues $119,642 $110,204 $461,594 $447,244 operating expenses vessel operating expenses (28,714) (24,467) (110,946) (102,502) depreciation & amortization (28,534) (26,572) (112,563) (105,238) general & administrative (6,440) (7,054) (24,341) (26,837) other operating expenses (3,377) (2,799) (14,264) (11,593) income from operations 52,577 49,312 199,480 201,074 other income/(expenses) interest income 1,686 1,663 6,638 6,414 interest expense (11,637) (17,166) (53,502) (72,069) other finance expenses (345) (300) (2,335) (2,702) equity income on investments 1,579 1,094 6,308 1,602 other income/(loss), net 232 127 593 556 realized loss on derivatives (913) (913) (3,632) (3,622) total other expenses, net (9,398) (15,495) (45,930) (69,821) net income $43,179 $33,817 $153,550 $131,253 earnings per share basic earnings per share $2.09 $1.83 $6.51 $8.29 diluted earnings per share $2.07 $1.79 $6.45 $8.09 basic weighted average number of common shares (in thousands of shares) 20,658 18,494 23,589 15,835 diluted weighted average number of common shares (in thousands of shares) 20,874 18,927 23,805 16,221 non-gaap measures1 reconciliation of net income to adjusted net income – unaudited three months ended three months ended year ended year ended december 31, december 31, december 31, december 31, 2020 2019 2020 2019 net income $43,179 $33,817 $153,550 $131,253 amortization of financing fees, debt discount & finance fees accrued 4,631 4,152 17,338 17,422 adjusted net income $47,810 $37,969 $170,888 $148,675 adjusted earnings per share, diluted $2.29 $2.01 $7.18 $9.17 diluted weighted average number of shares (in thousands) 20,874 18,927 23,805 16,221 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 and year ended december 31, 2020 and 2019. 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 december 31, december 31, 2020 2019 assets current assets cash and cash equivalents $65,663 $139,170 accounts receivable, net 7,556 7,145 other current assets 45,229 44,071 118,448 190,386 non-current assets fixed assets, net 2,479,937 2,389,874 deferred charges, net 17,339 11,455 investments in affiliates 15,273 8,965 other non-current assets 83,383 82,339 2,595,932 2,492,633 total assets $2,714,380 $2,683,019 liabilities and stockholders' equity current liabilities long-term debt, current portion $155,662 $119,673 accumulated accrued interest, current portion 18,036 34,137 long-term leaseback obligations, current portion 24,515 16,342 accounts payable, accrued liabilities & other current liabilities 41,472 52,928 239,685 223,080 long-term liabilities long-term debt, net 1,187,345 1,270,663 accumulated accrued interest, net of current portion 136,433 156,583 long-term leaseback obligations, net 95,585 121,872 other long-term liabilities 19,755 29,131 1,439,118 1,578,249 stockholders’ equity common stock 204 248 additional paid-in capital 755,390 785,274 accumulated other comprehensive loss (86,669) (116,934) retained earnings 366,652 213,102 1,035,577 881,690 total liabilities and stockholders' equity $2,714,380 $2,683,019 danaos corporation condensed consolidated statements of cash flows - unaudited (expressed in thousands of united states dollars) three months ended three months ended year ended year ended december 31, december 31, december 31, december 31, 2020 2019 2020 2019 operating activities: net income $43,179 $33,817 $153,550 $131,253 adjustments to reconcile net income to net cash provided by operating activities: depreciation 25,927 24,364 101,531 96,505 amortization of deferred drydocking & special survey costs, finance cost, debt discount and other finance fees accrued 7,238 6,360 28,900 26,155 pik interest 675 830 2,911 3,375 payments for drydocking/special survey (3,519) (1,943) (16,916) (7,157) amortization of deferred realized losses on cash flow interest rate swaps 913 913 3,632 3,622 equity income on investments (1,579) (1,094) (6,308) (1,602) stock based compensation 302 1,181 1,199 4,241 accounts receivable 3,290 492 (411) 2,080 other assets, current and non-current 857 (5,754) 3,199 (19,750) accounts payable and accrued liabilities 1,638 (2,618) 2,252 (3,181) other liabilities, current and long-term 726 (4,315) (7,860) (15,663) net cash provided by operating activities 79,647 52,233 265,679 219,878 investing activities: vessel additions and advances (64,512) (6,598) (170,661) (21,360) investments - - (75) - net cash used in investing activities (64,512) (6,598) (170,736) (21,360) financing activities: proceeds from sale-leaseback of vessels - - 139,080 146,523 proceeds from long-term debt 33,150 - 69,850 - payments of leaseback obligations (5,962) (3,160) (153,904) (8,309) debt repayment (46,998) (31,183) (146,747) (262,572) payments of accumulated accrued interest (4,853) (8,512) (25,639) (35,358) repurchase of common stock (31,127) - (31,127) - paid-in capital - 54,440 - 54,440 share issuance costs - (873) - (873) finance costs (50) - (19,963) (30,474) net cash provided by/(used in) financing activities (55,840) 10,712 (168,450) (136,623) net increase/(decrease) in cash and cash equivalents (40,705) 56,347 (73,507) 61,895 cash and cash equivalents, beginning of period 106,368 82,823 139,170 77,275 cash and cash equivalents, end of period $65,663 $139,170 $65,663 $139,170 danaos corporation reconciliation of net income to adjusted ebitda - unaudited (expressed in thousands of united states dollars) three months ended three months ended year ended year ended december 31, december 31, december 31, december 31, 2020 2019 2020 2019 net income $43,179 $33,817 $153,550 $131,253 depreciation 25,927 24,364 101,531 96,505 amortization of deferred drydocking & special survey costs 2,607 2,208 11,032 8,733 amortization of deferred finance costs, debt discount and other finance fees accrued 4,631 4,152 17,338 17,422 amortization of deferred realized losses on interest rate swaps 913 913 3,632 3,622 interest income (1,686) (1,663) (6,638) (6,414) interest expense 7,136 13,146 36,687 55,203 stock based compensation 302 1,181 1,199 4,241 adjusted ebitda(1) $83,009 $78,118 $318,331 $310,565 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 and year ended december 31, 2020 and 2019. 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.
