Danaos reports 32% growth in Q3 profits

The containership owner posted operating revenues of $113.6 million for the third quarter of 2017, a 1.6 percent increase compared to $111.8 million for the three months ended Sept. 30, 2016, according to the company’s most recent financial statements.    Athens-based containership owner Danaos Corp. reported adjusted net income of $30.1 million, or $0.27 per share, for the third quarter of 2017, a 32 percent increase compared to $22.8 million ($0.21 per share) in the third quarter of 2016, according to the company’s unaudited financial results for the period ended Sept. 30.
   Additionally, Danaos reported adjusted net income of $83.7 million ($0.76 per share) in the first three quarters of 2017 combined, compared to $117.7 million ($1.07 per share) for the first nine months of 2016, a 28.9 percent drop.
   The company posted operating revenues of $113.6 million for the third quarter of 2017, compared to $111.8 million for the three months ended Sept. 30, 2016, a 1.6 percent increase, according to Danaos figures. Year-to-date operating revenues, however, slid 12.6 percent to $337.6 million compared with the same nine-month period in 2016.
   Danaos also reported adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) of $79.8 million for the third quarter of 2017, an increase of 5.7 percent compared to $75.5 million the previous year. For the first three quarters of the year, the company posted an adjusted EBITDA of $230.4 million, a 16.1 percent drop compared to $274.7 million during the same period last year.
   Total contracted operating revenues stood at $1.8 billion as of Sept. 30, Danaos said, with charters extending through 2028 and remaining average contracted charter duration of six years, weighted by aggregate contracted charter hire.
   In addition, the company reported charter coverage of 87 percent for the next 12 months, based on current operating revenues, and 71 percent in terms of contracted operating days.
   “Our earnings for the third quarter of 2017 improved markedly when compared to the earnings of the third quarter of 2016, which were negatively impacted in the aftermath of the Hanjin bankruptcy,” Danaos CEO Dr. John Coustas said. He attributed the company’s $7.3 million increase in quarterly adjusted net income to a $6 million increase in the operating revenues of the vessels that were previously chartered to Hanjin that didn’t record any operating revenues during the third quarter of 2016, plus improved operating performance of $1.3 million.
   Danaos, which is currently in breach of certain financial agreements as a result of the cancellation of eight charters with Hanjin when the South Korean carrier declared bankruptcy last fall, has said that it is engaged in discussions with lenders regarding refinancing substantially all of its debt maturing in 2018.
   The discussions, the company said, encompass potential amendments to the associated financial contracts that have been breached.
   “In the meantime,” Coustas said, “we continue to generate positive cash flows from our operations and currently are in a position to service all our operational obligations, as well as all scheduled principal amortization and interest payments under the original terms of our debt agreements.”