Danaos earnings float up

The containership owner recorded a net income of $22.8 million for the quarter, a sharp increase from a net loss of $446.6 million for the fourth quarter of 2016 when it had encountered headwinds from the aftermath of Hanjin’s insolvency.    Danaos Corp. recorded a $22.8 million net income for the fourth quarter of 2017, a sharp increase from a net loss of $446.6 million for the fourth quarter of 2016, the company’s latest financial statements revealed.
   John Coustas, chief executive officer of the Athens-based containership owner, highlighted how the company’s net loss for the fourth quarter of 2016 reflected the headwinds it had encountered from the aftermath of the bankruptcy of Hanjin.
   Formerly South Korea’s largest container carrier, which Hyundai Merchant Marine now holds the title of, Hanjin had filed for bankruptcy protection at the Seoul Central District Court on Aug. 31, 2016.
   Prior to filing bankruptcy, Hanjin chartered five, 3,400-TEU vessels and eight, 10,100-TEU vessels from Danaos.
   Coustas also attributed the net income for the fourth quarter of 2017 to the result of Danaos’ high charter contract coverage, which he said remains at 86 percent for the next 12 months based on current operating revenues and 69 percent in terms of contracted operating days.
   Meanwhile, Danaos recorded operating revenues of $114.2 million for the fourth quarter of 2017, inching up 1.9 percent year-over-year.
   Overall, Danaos averaged 55 containerships for the fourth quarter of 2017, with its fleet utilization floating around 97.8 percent.
   For the full year of 2017, Danaos had a net income of $83.9 million compared to a net loss of $366.2 million for 2016.
   However, operating revenues sank 9.4 percent from 2016 to $451.7 million.
   Danaos is in breach of certain financial covenants as a result of the Hanjin bankruptcy, and is currently engaged in discussions with its lenders regarding the restructuring of its debt, substantially all of which matures on Dec. 31, 2018, Coustas said.
   “In the meantime, we continue to generate positive cash flows from our operations and currently have sufficient liquidity to service all our operational obligations as well as all scheduled principal amortization and interest payments under the original terms of our debt agreements leading up to the December 2018 maturity date,” he said.