SOURCE: Danaos Corporation

Danaos Corporation

April 28, 2009 16:05 ET

Danaos Corporation Reports First Quarter Results for the Period Ended March 31, 2009

ATHENS, GREECE--(Marketwire - April 28, 2009) - Danaos Corporation ("Danaos") (NYSE: DAC), a leading international owner of containerships, today reported unaudited results for the period ended March 31, 2009.

Highlights for the First Quarter Ended March 31, 2009:

--  Net earnings on a comparable basis of $20.0 million or $0.37 per share
    for the quarter ended March 31, 2009 compared to $25.9 million or $0.48 per
    share for the respective period of 2008, adjusted for a gain on sale of
    vessels of $5.6 million recorded during the first quarter of 2008.
--  Operating revenues of $75.3 million for the quarter ended March 31,
    2009 compared to $69.9 million for the respective period of 2008.
--  EBITDA on a comparable basis of $47.9 million for the quarter ended
    March 31, 2009 compared to $45.6 million for the respective period of 2008,
    adjusted for a gain on sale of vessels of $5.6 million recorded during the
    first quarter of 2008.
    

Danaos' CEO Dr. John Coustas commented:

In the first quarter of 2009, we achieved solid earnings despite the overall market disruption. We report net earnings of $20.0 million or $0.37 per share, which I believe is a performance highly satisfactory considering the overall state of the world economy and the shipping markets in particular. We have managed to increase our revenues to $75.3 million, up from $69.9 million in the first quarter of 2008 as a direct result of the continuing successful expansion of our fleet and have kept the utilization rate of our fleet at the usual high levels of the past years. I am also very pleased to report that we have been able to keep the daily operating cost of our fleet under time charters unchanged as compared to that a year ago.

In this last quarter alone, we took delivery of two vessels which have already commenced their twelve-year charter with one of the largest liners in the world. The Zim Monaco and the Zim Dalian are two modern 4,253 TEU ships which were constructed and delivered to Danaos in time and according to schedule by Samsung Heavy Industries. We consequently have 29 vessels on order, all of which are chartered at reasonable charter rates with some of the largest liner companies in the world.

We wish to reiterate that our vessels both operating and those under construction are under long time charters with some of the largest counterparties in the shipping industry. Although the current economic conditions are presenting everybody in our trade with new challenges, our chartering arrangements do not allow for unilateral modification of the prevailing terms.

World trade has shown traces of stabilization particularly as we got closer to the end of March, while this has been more visible through April. A number of vessels in the world containership fleet which were idle throughout the previous period were called once again back in duty pointing to such stabilization and even a route specific recovery, which however remains to be tested against time.

We are also in the position to report more solid information regarding rearrangements of ship deliveries. We have come to an agreement with China Shipbuilding Trading Company to delay the delivery date of the five 8,530 TEU containerships under construction by two hundred days each on average. In addition, we have come to an agreement with Hanjin Heavy Industries & Construction Company to delay the delivery date of the five 6,500 TEU and the five 3,400 TEU containerships under construction by approximately one quarter each. As of today, we are expecting to take delivery of six vessels during the current year, twelve in 2010 (three of which may be delivered in the following year as their delivery is scheduled for December 2010) and eleven in 2011. Assuming that the three new-buildings of December 2010 will finally be delivered in 2011, the remaining capital expenditure installments are approximately $465 million for the remaining of 2009, $875 million for 2010 and $785 million for 2011.

During the first months of 2009, we signed a new $299 million loan facility with Deutsche Schiffsbank. This additional facility, together with the available undrawn capacity under our existing credit facilities and the cash expected to be generated by our operations, is expected to cover our 2009, and a portion of our 2010, funding requirements. We are currently in discussions to arrange additional financing for the unfunded part of our new building fleet and we believe that despite the challenging current credit conditions we should be able to obtain these additional funds in time to meet our commitments, also supported by the fact that all of our new buildings are already chartered for long-term periods. At the same time we are engaged in further negotiations to delay construction payments and subsequent deliveries of certain of our vessels for which we have not so far arranged for specific debt financing, which we will communicate to the market as soon as we have more concrete results.

On our existing debt we have either received waivers or are in discussions with the lead arrangers of such debt to receive waivers covering breaches of financial covenants, principally our loan to value requirements, our required ratio of total liabilities (after deducting cash and cash equivalents) to market value adjusted total assets and our book and market value adjusted net worth requirements. However, certain of these agreements have not yet been reduced to writing and remain subject to the requisite approval of the applicable lending syndicates.

Even more so in these challenging times, our strategy at Danaos is firmly focused in maximizing total returns of shareholders.

Three months ended March 31, 2009 compared to the three months ended March 31, 2008

During the quarter ended March 31, 2009, Danaos had an average of 39.0 containerships as opposed to 36.3 containerships for the same period of 2008. During the first quarter of 2009, we took delivery of two new vessels. Our fleet utilization was 96.3% in the first quarter of 2009.

Our net income on a comparable basis was $20.0 million or $0.37 per share for the three months ended March 31, 2009 compared to $25.9 million or $0.48 per share for the three months ended March 31, 2008, adjusted for a gain on sale of vessels of $5.6 million recorded during the first quarter of 2008. This represents a decrease of 22.8% or $5.9 million, which is mainly attributed to increased interest expense of $5.4 million resulted from the increase of our average indebtedness during the quarter ended March 31, 2009 compared to the same period of 2008. Furthermore, in the first quarter of 2009 deferred fees of $0.4 million were written-off. Our net income on a reported basis was $20.0 million or $0.37 per share for the three months ended March 31, 2009 compared to $31.5 million or $0.58 per share for the three months ended March 31, 2008.

Operating Revenue

Operating revenue increased 7.7%, or $5.4 million, to $75.3 million in the quarter ended March 31, 2009, from $69.9 million in the quarter ended March 31, 2008. The increase was primarily attributable to the addition of five vessels to our fleet, as follows:

                                         Vessel Size
Vessel Name                                 (TEU)          Date Delivered
                                      ------------------ ------------------
Zim Rio Grande                                     4,253       July 4, 2008
Zim Sao Paolo                                      4,253 September 22, 2008
Zim Kingston                                       4,253   November 3, 2008
Zim Monaco                                         4,253    January 2, 2009
Zim Dalian                                         4,253     March 31, 2009

These additions to our fleet contributed revenues of $8.2 million during the three months ended March 31, 2009. In addition, three 2,200 TEU containerships, the Hyundai Progress, the Hyundai Highway and the Hyundai Bridge, which were added to our fleet on February 11, 2008, March 18, 2008 and March 20, 2008, respectively, contributed incremental revenues of $3.1 million during the three months ended March 31, 2009 compared to the three months ended March 31, 2008. In addition, the Company sold three vessels as follows:

                                         Vessel Size
Vessel Name                                 (TEU)            Date Sold
                                      ------------------ ------------------
Maersk Constantia                                  3,101       May 20, 2008
Asia Express                                       3,101   October 26, 2008
Sederberg                                          3,101  December 10, 2008

These vessel sales reduced operating revenue by $2.9 million for the three months ended March 31, 2009 compared to the contribution by such vessels to operating revenue in the three months ended March 31, 2008. In addition, one 5,506 TEU containership, the APL Belgium and one 3,101 TEU containership, the Winderberg, which were sold on January 15, 2008 and January 25, 2008, respectively, contributed revenues of $0.3 million for the three months ended March 31, 2008 compared to nil contribution by such vessels in the three months ended March 31, 2009.

We also had a further decrease in revenues of $2.7 million, mainly attributed to revenue lost due to off-hire days of vessels under drydocking during the three months ended March 31, 2009 compared to the three months ended March 31, 2008.

Vessel Operating Expenses

Vessel operating expenses increased 11.6%, or $2.3 million, to $22.1 million in the quarter ended March 31, 2009, from $19.8 million in the quarter ended March 31, 2008. The increase was due to the increase in the average number of vessels in our fleet under time charter during the quarter ended March 31, 2009 compared to the quarter ended March 31, 2008.

Furthermore, we have successfully implemented efficient management controls on our operating expenses, resulting in a flat daily operating cost of less than $6,300 for the vessels of our fleet under time charter during the three months ended March 31, 2009 compared to the three months ended March 31, 2008.

Depreciation & Amortization

Depreciation & Amortization includes Depreciation and Amortization of Deferred Dry-docking and Special Survey Costs.

Depreciation

Depreciation expense increased 20.3%, or $2.4 million, to $14.2 million in the quarter ended March 31, 2009, from $11.8 million in the quarter ended March 31, 2008. The increase in depreciation expense was due to the increased average number of vessels in our fleet during the quarter ended March 31, 2009 compared to the same period of 2008.

Amortization of Deferred Dry-docking and Special Survey Costs

Amortization of deferred dry-docking and special survey costs increased 18.8%, or $0.3 million, to $1.9 million in the quarter ended March 31, 2009, from $1.6 million in the quarter ended March 31, 2008. The increase reflects higher drydocking costs incurred, which were subject to amortization during the three months ended March 31, 2009 as compared to the same period of 2008.

General and Administrative Expenses

General and administrative expenses increased 10.7%, or $0.3 million, to $3.1 million in the quarter ended March 31, 2009, from $2.8 million in the same quarter of 2008. The increase was primarily a result of increased fees of $0.4 million paid to our Manager in the first quarter of 2009 compared to the same period of 2008 due to the increase in the average number of our vessels in our fleet and an increase of the fees paid to our manager.

On February 12, 2009, the Company signed an addendum to the management contract amending the management fees to a fee of $575 per day (from $500 per day), a fee of $290 per vessel per day (from $250 per vessel per day) for vessels on bareboat charter, a fee of $575 per vessel per day (from $500 per vessel per day) for vessels on time charter and a flat fee of $725,000 per newbuilding vessel (from $400,000 per newbuilding vessel) for the supervision of newbuilding contracts. All commissions to Manager remained unchanged.

Other Operating Expenses

Other Operating Expenses include Voyage Expenses

Voyage Expenses

Voyage expenses increased 25.0% or $0.4 million, to $2.0 million in the quarter ended March 31, 2009, from $1.6 million for the quarter ended March 31, 2008. The increase was the result of increased bunker costs of $0.4 million, attributed to five of our vessels for which drydocking was performed during the first quarter of 2009. Our vessels are not otherwise subject to fuel costs, which are paid by our charterers.

Interest Expense and Interest Income

Interest expense increased 74.0%, or $5.4 million, to $12.7 million in the quarter ended March 31, 2009, from $7.3 million in the quarter ended March 31, 2008. The change in interest expense was due to the increase in our average debt by $748.9 million to $2,101.7 million in the quarter ended March 31, 2009, from $1,352.8 million in the quarter ended March 31, 2008. The financing of our extensive new-building program resulted in interest capitalization, rather than such interest being recognized as an expense, of $7.2 million for the quarter ended March 31, 2009 compared to $10.2 million of capitalized interest for the quarter ended March 31, 2008.

Interest income decreased by $0.1 million, to $1.0 million in the quarter ended March 31, 2009, from $1.1 million in the quarter ended March 31, 2008. The decrease in interest income is attributed to lower interest rates during the three months ended March 31, 2009 as opposed to the three months ended March 31, 2008.

Restricted cash is attributed to cash raised through our revolving credit facilities designated to finance certain of our new buildings and is gradually utilized to fund progress payments of these new buildings up to their deliveries through the third quarter of 2011.

Other income/(expenses), net

Other income/(expenses), net, decreased by $0.1 million, to $(0.4) million in the quarter ended March 31, 2009, from $(0.3) million in the same quarter of 2008.

EBITDA

EBITDA on a comparable basis increased by $2.3 million, or 5.0%, to $47.9 million in the quarter ended March 31, 2009, from $45.6 million in the quarter ended March 31, 2008, adjusted for a gain on sale of vessels of $5.6 million recorded during the first quarter of 2008. EBITDA on a reported basis decreased by $3.3 million, or 6.4%, to $47.9 million in the quarter ended March 31, 2009, from $51.2 million in the quarter ended March 31, 2008. A table reconciling EBITDA to net income can be found at the end of this earnings release.

Recent News

Based on the unaudited financial statements for the year ended December 31, 2008 and valuations of our fleet as of December 2008 that we received from two independent ship brokers, we determined that we were in breach of covenants, principally our loan to value requirements, our required ratio of total liabilities (after deducting cash and cash equivalents) to market value adjusted total assets and our book and market value adjusted net worth requirements under certain of our credit facilities. Substantially all of our long-term debt continues to be classified as non-current as of December 31, 2008 and March 31, 2009, because our debt covenant violations as of December 31, 2008 have been (or are expected to be) waived by our lenders and the relevant covenants have been (or are expected to be) amended to levels that we expect to be able to comply within future periods. To the extent that we are unable to finalize formalization of these waivers and amendments prior to the issuance of our audited 2008 financial statements, any long-term debt for which we have been unable to secure waivers and, where applicable, amended covenants, will be required to be classified as current, reflecting our lenders' ability to call that debt at any time at their option.

We have come to an agreement with China Shipbuilding Trading Company to delay the delivery date of the five 8,530 TEU containerships under construction by two hundred days each on average. In addition, we have come to an agreement with Hanjin Heavy Industries & Construction Company to delay the delivery date of the five 6,500 TEU and the five 3,400 TEU containerships under construction by approximately one quarter each. As of today we are expecting to take delivery of six vessels during the current year, twelve in 2010 (three of which may be delivered in the following year as their delivery is scheduled for December 2010) and eleven in 2011. Assuming that the three newbuildings of December 2010 will finally be delivered in 2011, the remaining capital expenditure installments are approximately $465 million for the remaining of 2009, $875 million for 2010 and $785 million for 2011. Each of our newbuilding vessels, including those with delayed deliveries, have long-term time charters arranged at reasonable rates with leading liner companies.

Conference Call and Webcast

On Wednesday, April 29, 2009 at 10:00 A.M. EDT, the Company's management will host a conference call to discuss the results. Conference Call details: Participants should dial into the call 10 minutes before the scheduled time using the following numbers: 1 866 819 7111 (US Toll Free Dial In), 0800 953 0329 (UK Toll Free Dial In) or +44 (0)1452 542 301 (Standard International Dial In). Please quote "Danaos" to the operator.

In case of any problems with the above numbers, please dial 1 866 223 0615 (US Toll Free Dial In). 0800 694 1503 (UK Toll Free Dial In) or +44 (0)1452 586 513 (Standard International Dial In). Please quote "Danaos" to the operator. A telephonic replay of the conference call will be available until May 6, 2009 by dialing 1 866 247 4222 (US Toll Free Dial In), 0800 953 1533 (UK Toll Free Dial In) or +44 (0)1452 550 000 (Standard International Dial In). Access Code: 1186615#. Audio webcast: There will also be a live and then archived webcast of the conference call through the Danaos website (www.danaos.com). Participants to the live webcast should register on the website approximately 10 minutes prior to the start of the webcast.

About Danaos Corporation

Danaos Corporation is an international owner of containerships, chartering its vessels to many of the world's largest liner companies. Our current fleet of 40 containerships aggregating 161,680 TEUs ranks Danaos among the largest containership charter owners in the world based on total TEU capacity. Danaos is the largest US listed containership company based on fleet size. Furthermore, the company has a contracted fleet of 29 additional containerships aggregating 222,203 TEU with scheduled deliveries up to 2011. The company'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 safeharbor 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, many of which are based, in turn, upon further assumptions, including without limitation, management's examination of historical operating trends, data contained in our records and other data available from third parties. 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 strength of world economies and currencies, general market conditions, including changes in charter hire rates and vessel values, charter counterparty performance, shipyard performance, changes in demand that may affect attitudes of time charterers to scheduled and unscheduled drydocking, 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 129 off-hire days in total in the first quarter of 2009. The following table summarizes vessel utilization and the impact of the off-hire days on the company's revenue relating to the last four quarters.


                       Second     Third      Fourth     First
Vessel Utilization    Quarter    Quarter    Quarter    Quarter
 (No. of Days)         2008       2008       2008       2009       Total
                     ---------  ---------  ---------  ---------  ---------
Ownership Days           3,417      3,502      3,560      3,510     13,989
Less Off-hire Days:
  Scheduled Off-hire
   Days                    (78)       (40)       (29)      (125)      (272)
  Other Off-hire
   Days                     --         (2)       (23)        (4)       (29)
                     ---------  ---------  ---------  ---------  ---------
Operating Days           3,339      3,460      3,508      3,381     13,688
                     =========  =========  =========  =========  =========
Vessel Utilization        97.7%      98.8%      98.5%      96.3%      97.8%



Revenue - Impact of
 Off-hire              Second     Third      Fourth     First
(in '000s of US       Quarter    Quarter    Quarter    Quarter
 Dollars)              2008       2008       2008       2009       Total
                     ---------  ---------  ---------  ---------  ---------


100% Fleet
 Utilization         $  74,482  $  77,303  $  79,866  $  77,931  $ 309,582
Less Off-hire Days:
  Scheduled Off-hire
   Days                   (573)      (807)      (563)    (2,512)    (4,455)
  Other Off-hire
   Days                     --        (80)      (600)      (167)      (847)
                     ---------  ---------  ---------  ---------  ---------
Actual Revenue
 Earned              $  73,909  $  76,416  $  78,703  $  75,252  $ 304,280
                     =========  =========  =========  =========  =========

Fleet List

The following table describes in detail our fleet deployment profile as of April 28, 2009.


                                 Vessel Size                  Expiration of
Vessel Name                         (TEU)       Year Built     Charter(1)
                               -------------- -------------- --------------
Containerships

CSCL Le Havre                           9,580           2006 September 2018
CSCL Pusan                              9,580           2006      July 2018
MSC Baltic                              8,468           2004 September 2016
CSCL Europe                             8,468           2004      June 2016
MSC Marathon (2)                        4,814           1991 September 2011
Maersk Messologi                        4,814           1991 September 2011
Maersk Mytilini                         4,814           1991 September 2011
Hyundai Commodore (3)                   4,651           1992     March 2011
Hyundai Duke                            4,651           1992  February 2011
APL Confidence (4)                      4,651           1994 September 2012
YM Colombo                              4,300           2004     March 2019
YM Singapore                            4,300           2004   October 2019
YM Seattle                              4,253           2007      July 2019
YM Vancouver                            4,253           2007 September 2019
Derby (5)                               4,253           2004     April 2010
Maersk Deva                             4,253           2004   January 2011
ZIM Rio Grande                          4,253           2008       May 2020
ZIM Sao Paolo                           4,253           2008    August 2020
ZIM Kingston                            4,253           2008 September 2020
ZIM Monaco                              4,253           2009  November 2020
ZIM Dalian                              4,253           2009  February 2021
Al Rayyan                               3,908           1989   January 2011
YM Yantian                              3,908           1989      July 2011
YM Milano                               3,129           1988       May 2011
CMA CGM Lotus                           3,098           1988      July 2010
CMA CGM Vanille                         3,045           1986      July 2010
CMA CGM Passiflore                      3,039           1986       May 2010
CMA CGM Elbe                            2,917           1991      June 2010
CMA CGM Kalamata                        2,917           1991      June 2010
CMA CGM Komodo                          2,917           1991      June 2010
Hyundai Advance                         2,200           1997      June 2017
Hyundai Future                          2,200           1997    August 2017
Hyundai Sprinter                        2,200           1997    August 2017
Hyundai Stride                          2,200           1997      July 2017
Hyundai Progress                        2,200           1998  December 2017
Hyundai Bridge                          2,200           1998   January 2018
Hyundai Highway                         2,200           1998   January 2018
Hyundai Vladivostok                     2,200           1997       May 2017
Montreal Senator (6)                    2,130           1984       May 2010
MSC Eagle                               1,704           1978   January 2010

(1)  Earliest date charters could expire. Some charters include options to
     extend their term.
(2)  On August 22, 2008, the Maersk Marathon was renamed to MSC Marathon at
     the request of the charterer of this   vessel.
(3)  On April 2, 2009, the MOL Affinity was renamed to Hyundai Commodore at
     the request of the charterer of this vessel.
(4)  On June 2, 2008, the MOL Confidence was renamed to APL Confidence at
     the request of the charterer of this vessel.
(5)  On April 10, 2009, the Maersk Derby was renamed to Derby at the
     request of the charterer of this vessel.
(6)  On April 8, 2008, the Pacific Bridge was renamed to Montreal Senator
     at the request of the charterer of this vessel.


New Deliveries

The following table describes the expected additions to our fleet as a result of our new building containership program.


                                Vessel Size      Expected     Time Charter
Vessel Name                        (TEU)         Delivery         Term
                               -------------- -------------- --------------
HN 1699                                 4,253      June 2009       12 years
HN S4001(1)                             6,500      July 2009       12 years
HN S4002(1)                             6,500 September 2009       12 years
HN S4003(1)                             6,500   October 2009       12 years
HN S4004(1)                             6,500  December 2009       12 years
HN N-219                                3,400  December 2009       10 years
HN N-214                                6,500   January 2010       18 years
HN S4005(1)                             6,500   January 2010       12 years
HN N-215                                6,500     March 2010       18 years
HN N-220                                3,400     April 2010       10 years
HN N-216                                6,500       May 2010       15 years
HN N-217                                6,500      July 2010       15 years
HN N-221                                3,400      July 2010       10 years
HN N-218                                6,500 September 2010       15 years
HN N-222                                3,400   October 2010       10 years
HN N-223                                3,400  December 2010       10 years
Hull No S-461                          10,100  December 2010       12 years
Hull No S-456                          12,600  December 2010       12 years
Hull No S-462                          10,100  February 2011       12 years
HN Z00001                               8,530     March 2011       12 years
Hull No S-463                          10,100     March 2011       12 years
Hull No S-457                          12,600     March 2011       12 years
Hull No S-458                          12,600       May 2011       12 years
HN Z00002                               8,530       May 2011       12 years
HN Z00003                               8,530      June 2011       12 years
HN Z00004                               8,530      June 2011       12 years
Hull No S-459                          12,600      June 2011       12 years
Hull No S-460                          12,600    August 2011       12 years
HN H 1022A                              8,530 September 2011       12 years

(1) Vessel subject to charterer's option to purchase vessel after first
    eight years of time charter term for $78.0 million.





                            DANAOS CORPORATION
                           Statements of Income
                                (Unaudited)
             (Expressed in thousands of United States dollars,
                     except share and per share amounts)



                                             Three months    Three months
                                                ended           ended
                                               March 31,       March 31,
                                            --------------  --------------
                                                 2009            2008
                                            --------------  --------------

OPERATING REVENUES                          $       75,252  $       69,877

OPERATING EXPENSES
  Vessel operating expenses                        (22,063)        (19,810)
  Depreciation & amortization                      (16,136)        (13,369)
  General & administrative                          (3,120)         (2,813)
  Gain on sale of vessels                               --           5,582
  Other operating expenses                          (2,004)         (1,636)
                                            --------------  --------------
Income From Operations                              31,929          37,831
                                            --------------  --------------

OTHER EARNINGS (EXPENSES)
  Interest income                                      986           1,086
  Interest expense                                 (12,708)         (7,340)
  Other finance cost, net                             (336)           (425)
  Other income / (expenses), net                      (419)           (293)
  Gain on derivatives                                  593             658
                                            --------------  --------------
Total Other Income (Expenses), net                 (11,884)         (6,314)
                                            --------------  --------------

Net income from continuing operations       $       20,045  $       31,517
                                            --------------  --------------
Net (loss) income from discontinued
 operations                                             --               5
                                            --------------  --------------
Net Income                                  $       20,045  $       31,522
                                            ==============  ==============

EARNINGS PER SHARE (from continuing
 operations)
Basic and diluted net income per share      $         0.37  $         0.58
                                            ==============  ==============

EARNINGS PER SHARE
Basic and diluted net income per share      $         0.37  $         0.58
                                            ==============  ==============
Basic and diluted weighted average number
 of shares (in thousands of shares)                 54,547          54,558
                                            ==============  ==============





                            DANAOS CORPORATION
                              Balance Sheets
                                (Unaudited)
            (Expressed in thousands of United States dollars)



                                                 As of          As of
                                               March 31,     December 31,
                                            --------------  --------------
                                                 2009            2008
                                            --------------  --------------
ASSETS
CURRENT ASSETS
  Cash and cash equivalents                 $      106,014  $      120,720
  Restricted cash, current portion                 145,098         190,951
  Accounts receivable, net                             786           1,119
  Other current assets                              27,953          23,954
                                            --------------  --------------
                                                   279,851         336,744
NON-CURRENT ASSETS
  Fixed assets, net                              1,456,784       1,339,645
  Advances for vessel acquisitions and
   vessels under construction                    1,069,478       1,067,825
  Restricted cash, net of current portion           74,473          60,591
  Deferred charges, net                             19,733          16,098
  Fair value of financial instruments                5,911           6,691
  Other non-current assets                             943             870
                                            --------------  --------------
                                                 2,627,322       2,491,720

                                            --------------  --------------
TOTAL ASSETS                                     2,907,173       2,828,464
                                            ==============  ==============

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
  Long-term debt, current portion                   32,219          32,219
  Accounts payable, accrued liabilities &
   other current liabilities                        40,089          31,779
  Fair value of financial instruments,
   current portion                                  52,527          48,217
                                            --------------  --------------
                                                   124,835         112,215
LONG-TERM LIABILITIES
  Long-term debt, net of current portion         2,132,419       2,075,459
  Fair value of financial instruments, net
   of current portion                              369,150         414,668
  Other long-term liabilities                        6,726           7,088
                                            --------------  --------------
                                                 2,508,295       2,497,215

STOCKHOLDERS' EQUITY
  Common stock                                         546             546
  Additional paid-in capital                       288,584         288,615
  Treasury stock                                       (41)            (88)
  Accumulated other comprehensive loss            (439,566)       (474,514)
  Retained earnings                                424,520         404,475
                                            --------------  --------------
                                                   274,043         219,034

                                            --------------  --------------
Total liabilities and stockholders' equity  $    2,907,173  $    2,828,464
                                            ==============  ==============





                            DANAOS CORPORATION
                         Statements of Cash Flows
                                (Unaudited)
            (Expressed in thousands of United States dollars)


                                             Three months    Three months
                                                ended           ended
                                               March 31,       March 31,
                                            --------------  --------------
                                                 2009            2008
                                            --------------  --------------
Cash Flows provided by / (used in):
Operating Activities:
  Net income                                $       20,045  $       31,522
  Adjustments to reconcile net income to
   net cash provided by operating
   activities:
  Depreciation                                      14,221          11,759
  Amortization of deferred charges                   2,022           1,643
  Written off amount of deferred charges               412             181
  Stock based compensation                              16              --
  Payments for drydocking / special survey          (4,720)         (3,184)
  Change in fair value of debt and
   financial instruments                            (6,853)         (1,781)
  Gain on sale of vessels                               --          (5,582)
  Accounts receivable                                  333           1,354
  Other assets, current and non-current             (4,072)         (2,727)
  Accounts payable and accrued liabilities           6,856           2,911
  Other liabilities, current and
   non-current                                       1,092             (33)
                                            --------------  --------------
Cash provided by Operating Activities               29,352          36,063
                                            --------------  --------------

Investing Activities:
  Vessel acquisitions including advances              (131)        (76,240)
  Vessels under construction                      (132,882)       (137,280)
  Proceeds from sale of vessels                         --          54,457
                                            --------------  --------------
Cash used in Investing Activities                 (133,013)       (159,063)
                                            --------------  --------------

Financing Activities:
  Debt draw downs                                   67,550         185,013
  Debt repayment                                    (9,217)        (40,217)
  Dividends paid                                        --         (25,369)
  Deferred costs                                    (1,349)         (1,179)
  Decrease in restricted cash                       31,971           4,972
                                            --------------  --------------
Cash provided by Financing Activities               88,955         123,220
                                            --------------  --------------
Net change in cash and cash equivalents            (14,706)            220
Cash and cash equivalents, beginning of
 period                                            120,720          63,495
                                            --------------  --------------
Cash and cash equivalents, end of period    $      106,014  $       63,715
                                            ==============  ==============





Reconciliation of Net Income to EBITDA - Unaudited


                                             Three months    Three months
                                                ended           ended
                                               March 31,       March 31,
                                            --------------  --------------
                                                 2009            2008
                                            --------------  --------------
  Net income                                $       20,045  $       31,517
  Depreciation                                      14,221          11,759
  Amortization of deferred drydocking &
   special survey costs                              1,915           1,610
  Interest income                                     (986)         (1,086)
  Interest expense                                  12,708           7,340
                                            --------------  --------------
  EBITDA (1) from continuing operations     $       47,903  $       51,140
  EBITDA (1) from discontinued operations               --               5
                                            --------------  --------------
  EBITDA (1)                                $       47,903  $       51,145
                                            ==============  ==============


(1)  EBITDA represents net income before interest, income tax expense,
     depreciation and amortization. However, EBITDA is not a recognized
     measurement under U.S. generally accepted accounting principles, or
     "GAAP." We believe that the presentation of 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 EBITDA is useful in evaluating
     our ability to service additional debt and make capital expenditures.
     In addition, we believe that EBITDA is useful in evaluating our
     operating performance and liquidity position compared to that of other
     companies in our industry because the calculation of 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 and liquidity.

Contact Information


  • For further information please contact:

    Company Contact:

    Dimitri J. Andritsoyiannis
    Chief Financial Officer
    Danaos Corporation
    Athens, Greece
    Tel.: +30 210 419 6481
    E-Mail: cfo@danaos.com

    Iraklis Prokopakis
    Chief Operating Officer
    Danaos Corporation
    Athens, Greece
    Tel.: +30 210 419 6400
    E-Mail: coo@danaos.com

    Investor Relations and Financial Media
    Nicolas Bornozis
    President
    Capital Link, Inc.
    New York
    Tel. 212-661-7566
    E-Mail: nbornozis@capitallink.com