• Adjusted EPS: $6.93 per share for Q4 2024, compared to $6.99 per share for Q4 2023.
• Adjusted Net Income: $133.3 million for Q4 2024, compared to $136 million for Q4 2023.
• Adjusted EBITDA: Increased by 9.9% to $189.7 million for Q4 2024, from $172.6 million in Q4 2023.
• Vessel Operating Expenses: Increased to $45.6 million in Q4 2024 from $40.1 million in Q4 2023.
• Daily Operating Costs: $6,135 per vessel per day for Q4 2024, compared to $6,188 per vessel per day for Q4 2023.
• G&A Expenses: Decreased to $21.7 million in Q4 2024 from $22.4 million in Q4 2023.
• Interest Expense: Increased to $9.1 million in Q4 2024 from $3.1 million in Q4 2023.
• Interest Income: $3.9 million for Q4 2024.
• Contracted Revenue Backlog: Increased to $3.4 billion.
• Net Debt: $291 million as of December 31, 2024.
• Net Debt to Adjusted EBITDA Ratio: 0.4 times.
• Cash: $453.4 million as of the end of Q4 2024.
• Total Liquidity: $807 million, including availability under revolving credit facility and marketable securities.
• Share Repurchases: Total of $168.8 million executed out of the $200 million authority.

• Warning! GuruFocus has detected 10 Warning Signs with CTRRF.

Release Date: February 11, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Danaos Corp (NYSE:DAC) has secured 97% contract coverage for 2025 and 79% for 2026, providing stability against market volatility.
• The company has a strong charter backlog of $3.4 billion, ensuring a steady income stream.
• Danaos Corp (NYSE:DAC) has arranged a new $850 million facility to finance all vessels on order, demonstrating strong financial management.
• The company continues to maintain competitive operating costs, with daily operating costs slightly improving compared to the previous year.
• Danaos Corp (NYSE:DAC) has increased its dividend and continued its share buyback program, reflecting confidence in its financial position and commitment to shareholder returns.

Negative Points

• The dry bulk market remains weak due to the slow recovery of the Chinese economy and the delivery of new tonnage.
• There is a $2.7 million decrease in adjusted net income compared to the previous year, attributed to increased operating and finance costs.
• Vessel operating expenses increased by $5.5 million due to a larger fleet size, impacting overall profitability.
• Interest expenses rose significantly due to higher average indebtedness, affecting net income.
• Box rates in the container charter market are weakening, which could impact future revenue if the trend continues.

Q & A Highlights

Q: Do you agree that Danaos Corp is on pace to achieve a net cash position in 2025, and do you prefer to maintain leverage or be in a net cash position? A: Evangelos Chatzis, CFO, stated that Danaos Corp has arranged a $150 million facility covering 60% of their new building program financing. The company is generating substantial cash and remains in a surplus position, which supports their newbuilding program. They are not aiming for a negative net cash position and are focused on maintaining financial flexibility.

Q: Can you discuss the utilization of the dry bulk fleet and the number of dry dockings planned for 2025? A: Evangelos Chatzis, CFO, explained that all dry bulk vessels, except one, have completed dry docking in the last six months, with efficiency improvements made. No further dry dockings are planned for the dry bulk fleet for the next 2-3 years.

Q: With soft dry bulk rates and declining asset values, is there an interest in adding more vessels, and would you consider other types beyond capesizes? A: Evangelos Chatzis, CFO, confirmed that Danaos Corp is focused on capesize vessels and plans to increase their presence in this sector due to attractive pricing.

Q: What gave Danaos Corp the confidence to order two new ships despite the current market climate? A: John Coustas, CEO, stated that the sector requires modern, efficient ships, especially in the size bracket they are targeting. With financing and charters arranged for other vessels, the investment carries minimal risk.

Q: Can you provide an update on the share count following recent repurchases? A: Evangelos Chatzis, CFO, reported that the share count is just below 19 million shares, approximately 18.8-18.9 million, following the latest repurchases.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.