Danaos Corp added $308m to the charter backlog of its profitable container ship fleet as its dry bulk fleet weighed on third-quarter earnings.
The New York-listed owner of container ships and bulkers lifted its charter backlog to $3.3bn during the period, finding contracts for all of its unfixed newbuildings, chief executive John Coustas said in an earnings release.
Twelve of its 14 newbuildings are now on five-year charters, with the remaining pair on two-year deals.
“We have excellent earnings visibility,” he said, noting that the boxship fleet is 100% booked for the rest of this year and for 94% of next year and 73% of 2026.
The Athens-based company disclosed the contracting activity as it reported $123m in net income for the quarter, down from $133m in the same period of last year.
Adjusted net income, which factors out items not tracked in analyst estimates, fell to $125m from $143m.
That translated into adjusted earnings per share of $6.50, below the $6.77 average estimate of two analysts polled by Yahoo Finance.
Practically all of the quarterly profit came from the container ship fleet in what Coustas described as a “very strong” market.
“The dry bulk market has been uncharacteristically soft lately, which can be attributed to a disruption of seasonal patterns throughout the year as well as a decrease in Chinese steel production,” he said in the earnings release.
“Our dry bulk fleet performed reasonably well during the quarter, and we are expecting freight rates to gradually improve as we move into 2025.”
The company reported $256m in quarterly operating revenue, up from $239m in the same three-month period of 2023.
The result brought nine-month net income to $415m, down from $426m in the first three quarters of last year.
Looking forward, Coustas said the deep charter backlog will insulate the company from the “unstable and unpredictable” global backdrop.
“Most notably, President Trump has openly declared his intention to implement or increase trade tariffs that have the potential to decrease container movements or at least will reshuffle trade lanes,” he said.
“Additionally, it is likely that energy transition initiatives will take place at a slower rate, and we don’t know to what extent existing IMO initiatives will be supported by the new administration. Danaos remains in a fortunate and enviable position.”
The company, which owns 73 container ships on the water and 10 bulkers, ended the quarter with $384m in cash, out of $4.25bn in total assets. It reported net long-term debt totalling $679m.
