Danaos announces $1bn in incremental contracted revenue, sale proceeds
NYSE-listed Danaos Corporation has signed new charter arrangements for 11 vessels ranging between 2,500 and 10,000 TEUs with major liner companies.
January 19, 2022: NYSE-listed Danaos Corporation has signed new charter arrangements for 11 vessels ranging between 2,500 and 10,000 TEUs with major liner companies.
"These charters, which have a revenue weighted average contract duration of 4.7 years, commence on the expiration of the existing charters between February 2022 and April 2023 and extend up to May 2028," says an official release.
The new charters increase the contracted revenue backlog for Danos by approximately $870 million or by approximately $700 million in contracted EBITDA. Inclusive of these charters, the total contracted operating revenue was $2.8 billion as of December 31, 2021, with a remaining average contracted charter duration of four years weighted by aggregate contracted charter revenue. Additionally, contract coverage in terms of operating days is now 95 percent for 2022, 77 percent for 2023 and 57 percent for 2024.
"The company has also entered into an agreement to sell two 20-year-old 6,422 TEU vessels for a total consideration of $130 million and are expected to be delivered to their buyer in November 2022. The company acquired these vessels as part of the consolidation of Gemini Shipholdings Corporation on July 1, 2021, based on a fair value of $73 million, and expects to book a healthy profit when the sale is completed."
“We are very pleased to announce the continued improvement of our contracted backlog with multi-year charters for 11 of our vessels and the profitable sale of two older vessels," says Dr John Coustas, CEO, Danos. "The combined result is up to $1 billion of contracted revenue accretion and sales proceeds. These transactions significantly improve our liquidity and cash flow visibility for the next several years and further strengthen our balance sheet. We will continue to work to maximise our profitability and secure more accretive transactions with a focus on creating value for our shareholders.”
Danaos is one of the largest independent owners of modern, large-size containerships with a fleet of 71 containerships aggregating 436,589 TEU.
