Document and Entity Information
Document and Entity Information | 6 Months Ended |
Jun. 30, 2019 | |
Document and Entity Information | |
Entity Registrant Name | Danaos Corp |
Entity Central Index Key | 0001369241 |
Document Type | 6-K |
Document Period End Date | Jun. 30, 2019 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Document Fiscal Year Focus | 2019 |
Document Fiscal Period Focus | Q2 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
CURRENT ASSETS | ||
Cash and cash equivalents | $ 78,803 | $ 77,275 |
Accounts receivable, net | 7,496 | 9,225 |
Inventories | 9,165 | 8,884 |
Prepaid expenses | 1,142 | 1,214 |
Due from related parties | 20,084 | 17,970 |
Other current assets | 6,175 | 5,182 |
Total current assets | 122,865 | 119,750 |
NON-CURRENT ASSETS | ||
Fixed assets at cost, net of accumulated depreciation of $791,729 (2018: $743,924) | 2,433,731 | 2,480,329 |
Deferred charges, net | 10,467 | 13,031 |
Investments in affiliates | 7,311 | 7,363 |
Other non-current assets | 73,931 | 59,369 |
Total non-current assets | 2,525,440 | 2,560,092 |
Total assets | 2,648,305 | 2,679,842 |
CURRENT LIABILITIES | ||
Accounts payable | 11,350 | 10,477 |
Accrued liabilities | 10,765 | 11,770 |
Current portion of long-term debt, net | 113,826 | 113,777 |
Current portion of long-term leaseback obligation | 14,097 | |
Accumulated accrued interest, current portion | 35,351 | 35,782 |
Unearned revenue | 19,556 | 19,753 |
Other current liabilities | 18,363 | 31,142 |
Total current liabilities | 223,308 | 222,701 |
LONG-TERM LIABILITIES | ||
Long-term debt, net | 1,318,207 | 1,508,108 |
Long-term leaseback obligation, net of current portion | 130,340 | |
Accumulated accrued interest, net of current portion | 178,065 | 200,574 |
Unearned revenue, net of current portion | 34,675 | 41,730 |
Other long-term liabilities | 8,241 | 15,876 |
Total long-term liabilities | 1,669,528 | 1,766,288 |
Total liabilities | 1,892,836 | 1,988,989 |
Commitments and Contingencies | ||
STOCKHOLDERS' EQUITY | ||
Preferred stock (par value $0.01, 100,000,000 preferred shares authorized and not issued as of June 30, 2019 and December 31, 2018) | ||
Common stock (par value $0.01, 750,000,000 common shares authorized as of June 30, 2019 and December 31, 2018. 15,373,194 and 15,237,456 shares issued and outstanding as of June 30, 2019 and December 31, 2018, respectively (213,324,455 shares before 1-for-14 reverse stock split as of December 31, 2018)) | 154 | 152 |
Additional paid-in capital | 729,425 | 727,562 |
Accumulated other comprehensive loss | (119,540) | (118,710) |
Retained earnings | 145,430 | 81,849 |
Total stockholders' equity | 755,469 | 690,853 |
Total liabilities and stockholders' equity | $ 2,648,305 | $ 2,679,842 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018USD ($)$ / sharesshares | Jun. 30, 2019USD ($)$ / sharesshares | |
CONDENSED CONSOLIDATED BALANCE SHEETS | ||
Accumulated depreciation | $ | $ 743,924 | $ 791,729 |
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 100,000,000 | 100,000,000 |
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 750,000,000 | 750,000,000 |
Common stock, shares issued | 15,237,456 | 15,373,194 |
Common stock, shares outstanding | 15,237,456 | 15,373,194 |
Common stock, shares outstanding before reverse stock split | (213,324,455) | |
Number of shares issued for one share under reverse stock split | 0.0714 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
CONDENSED CONSOLIDATED STATEMENTS OF INCOME | ||||
OPERATING REVENUES | $ 112,319 | $ 113,466 | $ 225,210 | $ 225,320 |
OPERATING EXPENSES | ||||
Voyage expenses | (2,732) | (3,186) | (6,002) | (6,347) |
Vessel operating expenses | (27,306) | (26,742) | (53,177) | (53,591) |
Depreciation | (24,039) | (26,697) | (47,805) | (53,757) |
Amortization of deferred drydocking and special survey costs | (2,063) | (2,409) | (4,254) | (4,252) |
General and administrative expenses | (6,492) | (5,777) | (13,361) | (10,959) |
Income From Operations | 49,687 | 48,655 | 100,611 | 96,414 |
OTHER INCOME (EXPENSES): | ||||
Interest income | 1,569 | 1,418 | 3,165 | 2,793 |
Interest expense | (18,844) | (23,020) | (36,687) | (45,869) |
Other finance expenses | (1,770) | (961) | (2,094) | (1,932) |
Equity income/(loss) on investments | 32 | 210 | (52) | 184 |
Other income/(expense), net | 367 | (19,543) | 434 | (28,928) |
Loss on derivatives | (903) | (921) | (1,796) | (1,832) |
Total Other Expenses, net | (19,549) | (42,817) | (37,030) | (75,584) |
Net Income | $ 30,138 | $ 5,838 | $ 63,581 | $ 20,830 |
EARNINGS PER SHARE | ||||
Basic earnings per share | $ 2.02 | $ 0.74 | $ 4.26 | $ 2.66 |
Diluted earnings per share | $ 1.97 | $ 0.74 | $ 4.16 | $ 2.66 |
Basic weighted average common shares outstanding | 14,939 | 7,843 | 14,939 | 7,843 |
Diluted weighted average common shares outstanding | 15,314 | 7,843 | 15,276 | 7,843 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME/(LOSS) | ||||
Net income for the period | $ 30,138 | $ 5,838 | $ 63,581 | $ 20,830 |
Other comprehensive income/(loss): | ||||
Unrealized gain/(loss) on available for sale securities | (2,021) | 1,057 | (2,626) | 2,509 |
Amortization of deferred realized losses on cash flow hedges | 903 | 921 | 1,796 | 1,832 |
Total Other Comprehensive Income/(Loss) | (1,118) | 1,978 | (830) | 4,341 |
Comprehensive Income | $ 29,020 | $ 7,816 | $ 62,751 | $ 25,171 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) shares in Thousands, $ in Thousands | Common Stock | Additional paid-in capital | Accumulated other comprehensive loss | Retained earnings | Total |
Balance at Dec. 31, 2017 | $ 78 | $ 547,918 | $ (114,076) | $ 114,785 | $ 548,705 |
Balance (in shares) at Dec. 31, 2017 | 7,843 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net Income | 14,992 | 14,992 | |||
Net movement in other comprehensive income | 2,363 | 2,363 | |||
Balance at Mar. 31, 2018 | $ 78 | 547,918 | (111,713) | 129,777 | 566,060 |
Balance (in shares) at Mar. 31, 2018 | 7,843 | ||||
Balance at Dec. 31, 2017 | $ 78 | 547,918 | (114,076) | 114,785 | 548,705 |
Balance (in shares) at Dec. 31, 2017 | 7,843 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net Income | 20,830 | ||||
Net movement in other comprehensive income | 4,341 | ||||
Balance at Jun. 30, 2018 | $ 78 | 547,918 | (109,735) | 135,615 | 573,876 |
Balance (in shares) at Jun. 30, 2018 | 7,843 | ||||
Balance at Mar. 31, 2018 | $ 78 | 547,918 | (111,713) | 129,777 | 566,060 |
Balance (in shares) at Mar. 31, 2018 | 7,843 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net Income | 5,838 | 5,838 | |||
Net movement in other comprehensive income | 1,978 | 1,978 | |||
Balance at Jun. 30, 2018 | $ 78 | 547,918 | (109,735) | 135,615 | 573,876 |
Balance (in shares) at Jun. 30, 2018 | 7,843 | ||||
Balance at Dec. 31, 2018 | $ 152 | 727,562 | (118,710) | 81,849 | 690,853 |
Balance (in shares) at Dec. 31, 2018 | 15,237 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net Income | 33,443 | 33,443 | |||
Net movement in other comprehensive income | 288 | 288 | |||
Stock compensation | 830 | 830 | |||
Balance at Mar. 31, 2019 | $ 152 | 728,392 | (118,422) | 115,292 | 725,414 |
Balance (in shares) at Mar. 31, 2019 | 15,237 | ||||
Balance at Dec. 31, 2018 | $ 152 | 727,562 | (118,710) | 81,849 | 690,853 |
Balance (in shares) at Dec. 31, 2018 | 15,237 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net Income | 63,581 | ||||
Net movement in other comprehensive income | (830) | ||||
Balance at Jun. 30, 2019 | $ 154 | 729,425 | (119,540) | 145,430 | 755,469 |
Balance (in shares) at Jun. 30, 2019 | 15,373 | ||||
Balance at Mar. 31, 2019 | $ 152 | 728,392 | (118,422) | 115,292 | 725,414 |
Balance (in shares) at Mar. 31, 2019 | 15,237 | ||||
Increase (Decrease) in Stockholders' Equity | |||||
Net Income | 30,138 | 30,138 | |||
Net movement in other comprehensive income | (1,118) | (1,118) | |||
Stock compensation | $ 2 | 1,033 | 1,035 | ||
Stock compensation (in shares) | 136 | ||||
Balance at Jun. 30, 2019 | $ 154 | $ 729,425 | $ (119,540) | $ 145,430 | $ 755,469 |
Balance (in shares) at Jun. 30, 2019 | 15,373 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash Flows from Operating Activities | ||
Net income | $ 63,581 | $ 20,830 |
Adjustments to reconcile net income/(loss) to net cash provided by operating activities | ||
Depreciation | 47,805 | 53,757 |
Amortization of deferred drydocking and special survey costs | 4,254 | 4,252 |
Amortization of finance costs | 5,714 | 5,114 |
Exit fee accrued on debt | 295 | 1,484 |
Debt discount amortization | 3,234 | |
PIK interest | 1,695 | |
Payments for drydocking and special survey costs deferred | (1,690) | (10,351) |
Amortization of deferred realized losses on interest rate swaps | 1,796 | 1,832 |
Stock based compensation | 1,865 | |
Equity (income)/loss on investments | 52 | (184) |
(Increase)/Decrease in | ||
Accounts receivable | 1,729 | (9,292) |
Inventories | (281) | (216) |
Prepaid expenses | 72 | (727) |
Due from related parties | (2,114) | (932) |
Other assets, current and non-current | (8,750) | (6,953) |
Increase/(Decrease) in | ||
Accounts payable | 873 | 4,919 |
Accrued liabilities | (1,057) | 3,174 |
Unearned revenue, current and long-term | (7,252) | (10,724) |
Other liabilities, current and long-term | (365) | (391) |
Net Cash provided by Operating Activities | 111,456 | 55,592 |
Cash Flows from Investing Activities | ||
Vessels additions | (1,207) | (1,683) |
Advances for vessels additions | (9,431) | |
Net Cash used in Investing Activities | (10,638) | (1,683) |
Cash Flows from Financing Activities | ||
Proceeds from sale-leaseback of vessels | 146,523 | |
Payments of long-term debt | (205,811) | (48,381) |
Payments of leaseback obligation | (2,086) | |
Payments of accumulated accrued interest | (17,867) | |
Finance costs | (20,049) | |
Net Cash used in Financing Activities | (99,290) | (48,381) |
Net Increase in cash, cash equivalents and restricted cash | 1,528 | 5,528 |
Cash, cash equivalents and restricted cash at beginning of period | 77,275 | 69,707 |
Cash, cash equivalents and restricted cash at end of period | $ 78,803 | $ 75,235 |
Basis of Presentation and Gener
Basis of Presentation and General Information | 6 Months Ended |
Jun. 30, 2019 | |
Basis of Presentation and General Information | |
Basis of Presentation and General Information | 1 Basis of Presentation and General Information The accompanying condensed consolidated financial statements (unaudited) have been prepared in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The reporting and functional currency of the Company is the United States Dollar. Danaos Corporation (“Danaos” or “Company”), formerly Danaos Holdings Limited, was formed on December 7, 1998 under the laws of Liberia and is presently the sole owner of all outstanding shares of the companies listed below. Danaos Holdings Limited was redomiciled in the Marshall Islands on October 7, 2005. In connection with the redomiciliation, the Company changed its name to Danaos Corporation. On October 14, 2005, the Company filed and the Marshall Islands accepted Amended and Restated Articles of Incorporation. The authorized capital stock of Danaos Corporation is 750,000,000 shares of common stock with a par value of $0.01 and 100,000,000 shares of preferred stock with a par value of $0.01. Refer to Note 12, “Stockholders’ Equity”. The Company’s principal business is the acquisition and operation of vessels. Danaos conducts its operations through the vessel owning companies whose principal activity is the ownership and operation of containerships that are under the exclusive management of a related party of the Company. In the opinion of management, the accompanying condensed consolidated financial statements (unaudited) of Danaos and subsidiaries contain all adjustments necessary to present fairly, in all material respects, the Company’s condensed consolidated financial position as of June 30, 2019, the condensed consolidated results of operations for the three and six months ended June 30, 2019 and 2018 and the condensed consolidated cash flows for the three and six months ended June 30, 2019 and 2018. All such adjustments are deemed to be of a normal, recurring nature. These financial statements should be read in conjunction with the consolidated financial statements and related notes included in Danaos’ Annual Report on Form 20-F for the year ended December 31, 2018. The results of operations for the three and six months ended June 30, 2019, are not necessarily indicative of the results to be expected for the full year. The year-end condensed consolidated balance sheet data was derived from annual financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America. The accompanying condensed consolidated financial statements (unaudited) represent the consolidation of the accounts of the Company and its wholly owned subsidiaries. The subsidiaries are fully consolidated from the date on which control is transferred to the Company. They are de-consolidated from the date that control ceases. Inter-company transaction balances and unrealized gains on transactions between the companies are eliminated. The Company also consolidates entities that are determined to be variable interest entities, of which the Company is the primary beneficiary, as defined in the authoritative guidance under U.S. GAAP. A variable interest entity is defined as a legal entity where either (a) equity interest holders as a group lack the characteristics of a controlling financial interest, including decision making ability and an interest in the entity’s residual risks and rewards, or (b) the equity holders have not provided sufficient equity investment to permit the entity to finance its activities without additional subordinated financial support, or (c) the voting rights of some investors are not proportional to their obligations to absorb the expected losses of the entity, their rights to receive the expected residual returns of the entity, or both and substantially all of the entity’s activities either involve or are conducted on behalf of an investor that has disproportionately few voting rights.The condensed consolidated financial statements (unaudited) have been prepared to reflect the consolidation of the companies listed below. The historical balance sheets and results of operations of the companies listed below have been reflected in the condensed consolidated balance sheets and condensed consolidated statements of income, cash flows and stockholders’ equity at and for each period since their respective incorporation dates. The consolidated companies are referred to as “Danaos,” or “the Company.” On May 2, 2019, the Company effected a 1-for-14 reverse stock split of the issued and outstanding shares of common stock of the Company. All share and per share data disclosed in the accompanying condensed consolidated financial statements (unaudited) give effect to this reverse stock split retroactively, for all periods presented. The reverse stock split reduced the number of the Company’s outstanding shares of common stock from 213,324,455 to 15,237,456 on May 2, 2019 and affected all issued and outstanding shares of common stock. No fractional shares were issued in connection to the reverse stock split. Stockholders who would otherwise hold a fractional share of the Company’s common stock received a cash payment in lieu of such fractional share. The par value and other terms of the Company’s common stock were not affected by the reverse stock split. As of June 30, 2019, Danaos included the vessel owning companies (the “Danaos Subsidiaries”) listed below. All vessels are container vessels: Company Date of Incorporation Vessel Name Year Built TEU (1) Megacarrier (No. 1) Corp. September 10, 2007 Hyundai Honour 13,100 Megacarrier (No. 2) Corp. September 10, 2007 Hyundai Respect 13,100 Megacarrier (No. 3) Corp. September 10, 2007 Maersk Enping 13,100 Megacarrier (No. 4) Corp. September 10, 2007 Maersk Exeter 13,100 Megacarrier (No. 5) Corp. September 10, 2007 MSC Ambition 13,100 CellContainer (No. 6) Corp. October 31, 2007 Express Berlin 10,100 CellContainer (No. 7) Corp. October 31, 2007 Express Rome 10,100 CellContainer (No. 8) Corp. October 31, 2007 Express Athens 10,100 Karlita Shipping Co. Ltd. February 27, 2003 Pusan C 9,580 Ramona Marine Co. Ltd. February 27, 2003 Le Havre 9,580 Teucarrier (No. 5) Corp. September 17, 2007 CMA CGM Melisande 8,530 Teucarrier (No. 1) Corp. January 31, 2007 CMA CGM Attila 8,530 Teucarrier (No. 2) Corp. January 31, 2007 CMA CGM Tancredi 8,530 Teucarrier (No. 3) Corp. January 31, 2007 CMA CGM Bianca 8,530 Teucarrier (No. 4) Corp. January 31, 2007 CMA CGM Samson 8,530 Oceanew Shipping Ltd. January 14, 2002 Europe 8,468 Oceanprize Navigation Ltd. January 21, 2003 America 8,468 Boxcarrier (No. 2) Corp. June 27, 2006 CMA CGM Musset 6,500 Boxcarrier (No. 3) Corp. June 27, 2006 CMA CGM Nerval 6,500 Boxcarrier (No. 4) Corp. June 27, 2006 CMA CGM Rabelais 6,500 Boxcarrier (No. 5) Corp. June 27, 2006 CMA CGM Racine 6,500 Boxcarrier (No. 1) Corp. June 27, 2006 CMA CGM Moliere 6,500 Expresscarrier (No. 1) Corp. March 5, 2007 YM Mandate 6,500 Expresscarrier (No. 2) Corp. March 5, 2007 YM Maturity 6,500 Actaea Company Limited October 14, 2014 Performance 6,402 Asteria Shipping Company Limited October 14, 2014 Dimitra C 6,402 Continent Marine Inc. March 22, 2006 Zim Monaco 4,253 Medsea Marine Inc. May 8, 2006 Zim Dalian 4,253 Blacksea Marine Inc. May 8, 2006 Zim Luanda 4,253 Bayview Shipping Inc. March 22, 2006 Zim Rio Grande 4,253 Channelview Marine Inc. March 22, 2006 Zim Sao Paolo 4,253 Balticsea Marine Inc. March 22, 2006 Zim Kingston 4,253 Seacarriers Services Inc. June 28, 2005 YM Seattle 4,253 Seacarriers Lines Inc. June 28, 2005 YM Vancouver 4,253 Containers Services Inc. May 30, 2002 ANL Tongala 4,253 Containers Lines Inc. May 30, 2002 Derby D 4,253 Boulevard Shiptrade S.A September 12, 2013 Dimitris C 3,430 CellContainer (No. 4) Corp. March 23, 2007 Express Spain 3,400 CellContainer (No. 5) Corp. March 23, 2007 Express Black Sea 3,400 CellContainer (No. 1) Corp. March 23, 2007 Express Argentina 3,400 CellContainer (No. 2) Corp. March 23, 2007 Express Brazil 3,400 CellContainer (No. 3) Corp. March 23, 2007 Express France 3,400 Wellington Marine Inc. January 27, 2005 Singapore 3,314 Auckland Marine Inc. January 27, 2005 Colombo 3,314 Vilos Navigation Company Ltd. May 30, 2013 MSC Zebra 2,602 Trindade Maritime Company April 10, 2013 Amalia C 2,452 Sarond Shipping Inc. January 18, 2013 Danae C 2,524 Speedcarrier (No. 7) Corp. December 6, 2007 Highway 2,200 Speedcarrier (No. 6) Corp. December 6, 2007 Progress C 2,200 Speedcarrier (No. 8) Corp. December 6, 2007 Bridge 2,200 Speedcarrier (No. 1) Corp. June 28, 2007 Vladivostok 2,200 Speedcarrier (No. 2) Corp. June 28, 2007 Advance 2,200 Speedcarrier (No. 3) Corp. June 28, 2007 Stride 2,200 Speedcarrier (No. 5) Corp. June 28, 2007 Future 2,200 Speedcarrier (No. 4) Corp. June 28, 2007 Sprinter 2,200 (1) Twenty-feet equivalent unit, the international standard measure for containers and containership capacity. |
Significant Accounting Policies
Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2019 | |
Significant Accounting Policies | |
Significant Accounting Policies | 2 Significant Accounting Policies For a detailed discussion about the Company’s significant accounting policies, see Note 2 “Significant Accounting Policies” in the Company’s consolidated financial statements included in the Annual Report on Form 20-F for the year ended December 31, 2018 filed with the Securities and Exchange Commission on March 5, 2019. During the six months ended June 30, 2019, other than the following, there were no other significant changes made to the Company’s significant accounting policies: Changes in Accounting Principles: Leases In February 2016, the FASB issued Accounting Standards Update No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). ASU 2016-02 applies to both types of leases – capital (or finance) leases and operating leases. According to the new Accounting Standard, lessees are required to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases with terms of more than 12 months. This guidance requires companies to identify lease and non-lease components of a lease agreement. Lease components relate to the right to use the leased asset and non-lease components relate to payments for goods or services that are transferred separately from the right to use the underlying asset. Total lease consideration is allocated to lease and non-lease components on a relative standalone basis. The recognition of revenues related to lease components are governed by ASC 842 while revenue related to non-lease components are subject to ASC 606. In March 2018, the FASB tentatively approved a proposed amendment to ASU 842, that provide entities the optional transition method to initially account for the impact of the adoption with a cumulative adjustment to retained earnings on the effective date of the ASU. In addition, lessors can elect, as a practical expedient, not to allocate the total consideration to lease and non-lease components based on their relative standalone selling prices. As adopted by the Accounting Standards Update No. 2018-11 in July 2018, this practical expedient allows lessors to elect and account for the combined component based on its predominant characteristic. ASC 842 provides practical expedients that allow entities to not (i) reassess whether any expired or existing contracts are considered or contain leases; (ii) reassess the lease classification for any expired or existing leases; and (iii) reassess initial direct costs for any existing leases. In July 2018, the FASB issued Accounting Standards Update No. 2018-10, “Codification Improvements to Topic 842, Leases” and in December 2018 the Accounting Standards Update No. 2018-20 “Narrow-scope improvements for lessors”, which further improve and clarify ASU 2016-02. The Company adopted this standard on January 1, 2019 using the modified retrospective method. The Company derives its revenue from the time charters and bareboat charters of its vessels that are classified as operating leases. These charters involve placing the vessels at charterers use for a period of time in return for daily hire rates, which include lease component related to the right of use of the vessels and non-lease components primarily related to the operating expenses of the vessels paid by the Company. The revenue earned based on these charters is not negotiated in separate components. The Company elected the practical expedient to use the effective date of adoption as the date of initial application. Furthermore the Company elected practical expedients, which allow entities not (i) reassess whether any expired or existing contracts are considered or contain leases; (ii) reassess the lease classification for any expired or existing leases (iii) reassess initial direct costs for any existing leases and (iv) which allows to treat the lease and non-lease components as a single lease component provided the criteria are met. The adoption of this standard did not have a material effect on the condensed consolidated financial statements since the Company is primarily a lessor and the accounting for lessors is largely unchanged under this standard. Recent Accounting Pronouncements: In June 2016, the FASB issued ASU 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”), which amends the impairment model by requiring entities to use a forward-looking approach based on expected losses to estimate credit losses on certain types of financial instruments, including trade receivables. In December 2018, the FASB issued Accounting Standards Update No. 2018-19 "Codification improvements to Topic 326", which clarifies that impairment of receivables arising from operating leases should be accounted for in accordance with Topic 842, Leases. The ASU 2016-13 is effective for public entities for fiscal years beginning after December 15, 2019, with early adoption permitted. The Company is currently evaluating the impact of the new standard on the Company’s consolidated financial statements. |
Cash, Cash Equivalents and Rest
Cash, Cash Equivalents and Restricted Cash | 6 Months Ended |
Jun. 30, 2019 | |
Cash, Cash Equivalents and Restricted Cash | |
Cash, Cash Equivalents and Restricted Cash | 3 Cash, Cash Equivalents and Restricted Cash Cash, cash equivalents and restricted cash consisted of the following (in thousands): As of As of As of June 30, 2019 December 31, 2018 December 31, 2017 Cash and cash equivalents $ 78,803 $ 77,275 $ 66,895 Restricted cash — — 2,812 Total $ 78,803 $ 77,275 $ 69,707 The Company was required to maintain cash of $2.8 million as of December 31,2017 in retention bank accounts as a collateral for the upcoming scheduled debt payments of its KEXIM-ABN Amro credit facility, which were recorded under current assets in the Company’s Condensed Consolidated Balance Sheets. This credit facility was fully repaid in July 2018. |
Fixed assets, net
Fixed assets, net | 6 Months Ended |
Jun. 30, 2019 | |
Fixed assets, net | |
Fixed assets, net | 4 Fixed assets, net As of December 31, 2018, the Company recorded an impairment loss of $210.7 million in relation to ten of its vessels that are held and used. Fair value of each vessel was determined by management with the assistance from valuations obtained by third party independent shipbrokers. The residual value (estimated scrap value at the end of the vessels’ useful lives) of the fleet was estimated at $378.2 million as of June 30, 2019 and as of December 31, 2018. The Company has calculated the residual value of the vessels taking into consideration the 10 year average and the 5 year average of the scrap. The Company has applied uniformly the scrap value of $300 per ton for all vessels. The Company believes that $300 per ton is a reasonable estimate of future scrap prices, taking into consideration the cyclicality of the nature of future demand for scrap steel. Although the Company believes that the assumptions used to determine the scrap rate are reasonable and appropriate, such assumptions are highly subjective, in part, because of the cyclical nature of future demand for scrap steel. In connection with the 2018 debt refinancing, the Company undertook to seek to refinance two of its 13,100 TEU vessels, the Hyundai Honour and Hyundai Respect , which refinancing was completed on April 12, 2019 through a sale and leaseback arrangement with a term of five years, at the end of which the Company will reacquire the vessels for an aggregate amount of $52.6 million or earlier, at the Company’s option, for a purchase price set forth in the agreement. The net proceeds amounting to $144.8 million were applied pro rata to partially repay the existing credit facilities (Club Facility, Credit Suisse Facility, Citibank $114 mil. Facility and Citibank $123.9 mil. Facility) secured by mortgages on such vessels. This arrangement was recorded as failed sale and leaseback by the Company with the received proceeds recognized as a financial liability. The scheduled leaseback instalments subsequent to June 30, 2019 are as follows (in thousands): Instalments due by period ended: June 30, 2020 $ 31,304 June 30, 2021 32,522 June 30, 2022 32,521 June 30, 2023 32,522 June 30, 2024 77,127 Total leaseback instalments 205,996 Less: Imputed interest (61,559) Total leaseback obligation 144,437 Less: Current leaseback obligation (14,097) Leaseback obligation, net of current portion $ 130,340 |
Deferred Charges, net
Deferred Charges, net | 6 Months Ended |
Jun. 30, 2019 | |
Deferred Charges, net | |
Deferred Charges, net | 5 Deferred Charges, net Deferred charges, net consisted of the following (in thousands): Drydocking and Special Survey Costs As of January 1, 2018 $ 8,962 Additions 13,306 Amortization (9,237) As of December 31, 2018 13,031 Additions 1,690 Amortization (4,254) As of June 30, 2019 $ 10,467 The Company follows the deferral method of accounting for drydocking and special survey costs in accordance with accounting for planned major maintenance activities, whereby actual costs incurred are deferred and amortized on a straight-line basis over the period until the next scheduled survey, which is two and a half years. If special survey or drydocking is performed prior to the scheduled date, the remaining unamortized balances are immediately written off. Furthermore, when a vessel is drydocked for more than one reporting period, the respective costs are identified and recorded in the period in which they were incurred and not at the conclusion of the drydocking. |
Investments in affiliates
Investments in affiliates | 6 Months Ended |
Jun. 30, 2019 | |
Investments in affiliates | |
Investments in affiliates | 6 Investments in affiliates In August 2015, an affiliated company Gemini Shipholdings Corporation (“Gemini”) was formed by the Company and Virage International Ltd. (“Virage”), a company controlled by the Company’s largest shareholder. Gemini acquired a 100% interest in entities with capital leases for the Suez Canal and Genoa and that own the container vessels Catherine C and Leo C . Gemini financed these acquisitions with the assumption of capital lease obligations of $35.4 million, $19.0 million of borrowings under secured loan facilities and an aggregate of $47.4 million from equity contributions from the Company and Virage, which subscribed in cash for 49% and 51%, respectively, of Gemini’s issued and outstanding share capital. As of June 30, 2019, Gemini consolidated its wholly owned subsidiaries listed below: Year Date of vessel Company Vessel Name Built TEU delivery Averto Shipping S.A. Suez Canal 2002 5,610 July 20, 2015 Sinoi Marine Ltd. Genoa 2002 5,544 August 2, 2015 Kingsland International Shipping Limited Catherine C 2001 6,422 September 21, 2015 Leo Shipping and Trading S.A. Leo C 2002 6,422 February 4, 2016 Springer Shipping Co — — — — On May 29, 2019, an affiliated company of Gemini has entered into an agreement to acquire a 8,500 TEU container vessel built in 2006 for a gross purchase price of $25.3 million. An advance payment of $2.5 million was made and is outstanding as of June 30, 2019. This vessel is expected to be delivered in August 2019. The Company has determined that Gemini is a variable interest entity of which the Company is not the primary beneficiary, and as such, this affiliated company is accounted for under the equity method and recorded under “Equity income on investments” in the condensed consolidated statements of income. The Company does not guarantee the debt of Gemini and its subsidiaries and has the right to purchase all of the beneficial interest in Gemini that it does not own for fair market value at any time after December 31, 2018, to the extent permitted under its credit facilities. The net assets of Gemini total $14.9 million as of June 30, 2019. The Company’s exposure is limited to its share of the net assets of Gemini proportionate to its 49% equity interest in Gemini. A condensed summary of the financial information for equity accounted investments 49% owned by the Company shown on a 100% basis are as follows (in thousands): As of As of June 30, 2019 December 31, 2018 Current assets $ 4,355 $ 8,327 Non-current assets $ 45,173 $ 41,155 Current liabilities $ 9,252 $ 5,201 Non-current liabilities $ 25,355 $ 29,254 Six months ended Six months ended June 30, 2019 June 30, 2018 Net operating revenues $ 7,451 $ 8,625 Net income/(loss) $ (106) $ 376 |
Other Non-current Assets
Other Non-current Assets | 6 Months Ended |
Jun. 30, 2019 | |
Other Non-current Assets | |
Other Non-current Assets | 7 Other Non-current Assets Other non-current assets consisted of the following (in thousands): As of As of June 30, 2019 December 31, 2018 Available for sale securities: ZIM notes, net $ 19,733 $ 21,044 HMM notes, net 8,678 7,847 Equity participation ZIM — — Advances for vessels additions $ 14,851 $ 5,420 Other assets 30,669 25,058 Total $ 73,931 $ 59,369 Equity participation in ZIM and interest bearing unsecured ZIM notes maturing in 2023, which consist of $8.8 million Series 1 Notes and $41.1 million of Series 2 Notes, were obtained after the charter restructuring agreements with ZIM in July 2014. Interest bearing senior unsecured HMM notes consist of $32.8 million Loan Notes 1 maturing in July 2024 and $6.2 million Loan Notes 2 maturing in December 2022, which were obtained after the charter restructuring agreements with HMM in July 2016. As of December 31, 2016, the Company has recorded an impairment loss on its equity participation in ZIM amounting to $28.7 million, thus reducing its book value to nil and $0.7 million impairment loss on ZIM notes. See Note 7 “Other Non-current Assets” to the consolidated financial statements in the Annual Report on Form 20-F for the year ended December 31, 2018 for further details. The unrealized losses, which were recognized in other comprehensive loss, are analyzed as follows as of June 30, 2019 (in thousands): Amortized cost Description of securities basis Fair value Unrealized loss ZIM notes $ 45,899 $ 19,733 $ (26,166) HMM notes 21,516 8,678 (12,838) Total $ 67,415 $ 28,411 $ (39,004) Unrealized loss on available for sale securities Beginning balance as of January 1, 2019 $ (36,378) Unrealized loss on available for sale securities 2019 (2,626) Ending balance as of June 30, 2019 $ (39,004) The Company has agreed to install scrubbers on nine of its vessels, with estimated total costs amounting to approximately $27.9 million out of which advances of $13.2 million were paid before June 30, 2019 and the remaining amount of $14.7 million is expected to be paid in 2019. Other assets mainly include non-current assets related to straight-lining of the Company’s revenue amounting to $29.9 million and $23.1 million as of June 30, 2019 and December 31, 2018, respectively. |
Accrued Liabilities
Accrued Liabilities | 6 Months Ended |
Jun. 30, 2019 | |
Accrued Liabilities | |
Accrued Liabilities | 8 Accrued Liabilities Accrued liabilities consisted of the following (in thousands): As of As of June 30, 2019 December 31, 2018 Accrued payroll $ 830 $ 924 Accrued interest 4,896 6,304 Accrued expenses 5,039 4,542 Total $ 10,765 $ 11,770 Accrued expenses mainly consisted of accruals related to the operation of the Company’s fleet and other expenses as of June 30, 2019 and December 31, 2018. |
Long-Term Debt, net
Long-Term Debt, net | 6 Months Ended |
Jun. 30, 2019 | |
Long-Term Debt, net | |
Long-Term Debt, net | 9 Long-Term Debt, net Long-term debt, net consisted of the following (in thousands): Balance as of Balance as of Credit Facility June 30, 2019 December 31, 2018 The Royal Bank of Scotland $475.5 mil. Facility $ 466,789 $ 474,743 HSH Nordbank AG - Aegean Baltic Bank - Piraeus Bank $382.5 mil. Facility 376,001 379,762 Citibank $114 mil. Facility 79,143 110,644 Credit Suisse $171.8 mil. Facility 121,710 167,990 Citibank – Eurobank $37.6 mil. Facility 31,539 35,544 Club Facility $206.2 mil. 147,965 202,439 Sinosure Cexim - Citibank - ABN Amro $203.4 mil. Facility 50,850 61,020 Citibank $123.9 mil. Facility 90,435 122,523 Citibank $120 mil. Facility 107,110 115,973 Fair value of debt (22,831) (26,065) Comprehensive Financing Plan exit fees accrued 21,879 21,583 Total long-term debt $ 1,470,590 $ 1,666,156 Less: Deferred finance costs, net (38,557) (44,271) Less: Current portion (113,826) (113,777) Total long-term debt net of current portion and deferred finance cost $ 1,318,207 $ 1,508,108 Each of the new credit facilities are collateralized by first and second preferred mortgages over the vessels financed, general assignment of all hire freights, income and earnings, the assignment of their insurance policies, as well as any proceeds from the sale of mortgaged vessels, the Company’s investments in ZIM and Hyundai Merchant Marine securities, stock pledges and benefits from corporate guarantees. As of June 30, 2019, there was no remaining borrowing availability under the Company’s credit facilities. The Company was in compliance with the financial covenants of the credit facilities as of June 30, 2019 and December 31, 2018. The Sinosure–Cexim–Citibank–ABN Amro Credit Facility provides for semi-annual amortization payments and the New 2018 Credit Facilities provide for quarterly fixed and variable amortization payments, together representing approximately 85% of actual free cash flows from the relevant vessels securing such credit facilities, subject to certain adjustments. The New 2018 Credit Facilities have maturity dates of December 31, 2023 (or in some cases June 30, 2024). The scheduled debt maturities of total long-term debt subsequent to June 30, 2019 are as follows (in thousands): Fixed principal Total Payments due by period ended repayments Final payments* principal payments June 30, 2020 $ 113,826 — $ 113,826 June 30, 2021 119,084 — 119,084 June 30, 2022 105,927 — 105,927 June 30, 2023 85,222 — 85,222 June 30, 2024 35,879 $ 1,011,604 1,047,483 Total long-term debt $ 459,938 $ 1,011,604 $ 1,471,542 * The final payments include the unamortized remaining principal debt balances under the New 2018 Credit Facilities, as such amount will be determinable following the fixed amortization. As mentioned above, the Company is also subject to quarterly variable principal amortization based on actual free cash flows, which are included under “Final payments” in this table. The Company incurred nil and $29.7 million of professional fees related to the refinancing discussions with its lenders reported under “Other income/(expenses), net” in the accompanying condensed consolidated statements of income for the six months ended June 30, 2019 and 2018, respectively. Unpaid loan amendment fees of $17.8 million and $30.5 million are accrued under “Other current liabilities” and of $7.4 million and $14.8 million are accrued under “Other long-term liabilities” as of June 30, 2019 and December 31, 2018, respectively. |
Financial Instruments
Financial Instruments | 6 Months Ended |
Jun. 30, 2019 | |
Financial Instruments | |
Financial Instruments | 10 Financial Instruments The principal financial assets of the Company consist of cash and cash equivalents and trade receivables and other assets. The principal financial liabilities of the Company consist of long-term bank loans. The following is a summary of the Company’s risk management strategies and the effect of these strategies on the Company’s condensed consolidated financial statements. Interest Rate Risk: Interest rate risk arises on bank borrowings. The Company monitors the interest rate on borrowings closely to ensure that the borrowings are maintained at favorable rates. Concentration of Credit Risk: Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash and trade accounts receivable. The Company places its temporary cash investments, consisting mostly of deposits, with established financial institutions. The Company performs periodic evaluations of the relative credit standing of those financial institutions that are considered in the Company’s investment strategy. The Company is exposed to credit risk in the event of non-performance by counterparties, however, the Company limits this exposure by diversifying among counterparties with high credit ratings. The Company depends upon a limited number of customers for a large part of its revenues. Credit risk with respect to trade accounts receivable is generally managed by the selection of customers among the major liner companies in the world and their dispersion across many geographic areas. Fair Value: The carrying amounts reflected in the accompanying condensed consolidated balance sheets of financial assets and liabilities (excluding long-term bank loans and certain other non-current assets) approximate their respective fair values due to the short maturity of these instruments. The fair values of long-term floating rate bank loans approximate the recorded values, generally due to their variable interest rates.The fair value of available for sale securities is estimated based on either observable market based inputs or unobservable inputs that are corroborated by market data. The Company is exposed to changes in fair value of available for sale securities as there is no hedging strategy. a. Interest Rate Swap Hedges The Company currently has no outstanding interest rate swaps agreements. However, in the past years, the Company entered into interest rate swap agreements with its lenders in order to manage its floating rate exposure. Certain variable-rate interests on specific borrowings were associated with vessels under construction and were capitalized as a cost of the specific vessels. In accordance with the accounting guidance on derivatives and hedging, the amounts related to realized gains or losses on cash flow hedges that have been entered into and qualified for hedge accounting, in order to hedge the variability of that interest, were recognized in accumulated other comprehensive loss and are reclassified into earnings over the depreciable life of the constructed asset, since that depreciable life coincides with the amortization period for the capitalized interest cost on the debt. An amount of $1.8 million was reclassified into earnings for the six months ended June 30, 2019 and 2018, representing its amortization over the depreciable life of the vessels. An amount of $3.6 million is expected to be reclassified into earnings within the next 12 months. b. Fair Value of Financial Instruments The fair value hierarchy has three levels based on the reliability of the inputs used to determine fair value. Level I: Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets that the Company has the ability to access. Valuation of these items does not entail a significant amount of judgment. Level II: Inputs other than quoted prices included in Level I that are observable for the asset or liability through corroboration with market data at the measurement date. Level III: Inputs that are unobservable. The Company did not use any Level 3 inputs as of June 30, 2019 and December 31, 2018. The estimated fair values of the Company’s financial instruments are as follows: As of June 30, 2019 As of December 31, 2018 Book Value Fair Value Book Value Fair Value (in thousands of $) Cash and cash equivalents $ 78,803 $ 78,803 $ 77,275 $ 77,275 Due from related parties $ 20,084 $ 20,084 $ 17,970 $ 17,970 ZIM notes $ 19,733 $ 19,733 $ 21,044 $ 21,044 HMM notes $ 8,678 $ 8,678 $ 7,847 $ 7,847 Equity investment in ZIM — — — — Long-term debt, including current portion $ 1,470,590 $ 1,470,590 $ 1,666,156 $ 1,666,156 The estimated fair value of the financial instruments that are measured at fair value on a recurring basis, categorized based upon the fair value hierarchy, are as follows as of June 30, 2019: Fair Value Measurements as of June 30, 2019 Total (Level I) (Level II) (Level III) (in thousands of $) ZIM notes(1) $ 19,733 $ — $ 19,733 $ — HMM notes(1) $ 8,678 $ — $ 8,678 $ — The estimated fair value of the financial instruments that are not measured at fair value on a recurring basis, categorized based upon the fair value hierarchy, are as follows as of June 30, 2019: Fair Value Measurements as of June 30, 2019 Total (Level I) (Level II) (Level III) (in thousands of $) Long-term debt, including current portion(2) $ 1,470,590 $ — $ 1,470,590 $ — The estimated fair value of the financial instruments that are measured at fair value on a recurring basis, categorized based upon the fair value hierarchy, are as follows as of December 31, 2018: Fair Value Measurements as of December 31, 2018 Total (Level I) (Level II) (Level III) (in thousands of $) ZIM notes(1) $ 21,044 $ — $ 21,044 $ — HMM notes(1) $ 7,847 $ — $ 7,847 $ — The estimated fair value of the financial instruments that are not measured at fair value on a recurring basis, categorized based upon the fair value hierarchy, are as follows as of December 31, 2018: Fair Value Measurements as of December 31, 2018 Total (Level I) (Level II) (Level III) (in thousands of $) Long-term debt, including current portion(2) $ 1,666,156 $ — $ 1,666,156 $ — (1) (2) |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2019 | |
Commitments and Contingencies | |
Commitments and Contingencies | 11 Commitments and Contingencies There are no material legal proceedings to which the Company is a party or to which any of its properties are the subject, or other contingencies that the Company is aware of, other than routine litigation incidental to the Company’s business. Furthermore, the Company does not have any commitments outstanding. See the Note 7 "Other Non-current Assets" for capital commitments related to the installation of scrubbers on certain of the Company's vessels. |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2019 | |
Stockholders' Equity | |
Stockholders' Equity | 12 Stockholders’ Equity The Company's largest stockholder, Danaos Investment Limited ("DIL"), contributed $10 million to the Company in connection with the consummation of the Company’s debt refinancing on August 10, 2018. DIL did not receive any shares of common stock or other interests in the Company as a result of this contribution. Additionally, on August 10, 2018, in connection with this debt refinancing, the Company issued 7,095,877 shares (99,342,271 shares before the 1-for-14 reverse stock split) new shares of common stock to certain of the Company's lenders, which represented 47.5% of the outstanding common stock immediately after this issuance. As of April 18, 2008, the Board of Directors and the Compensation Committee approved incentive compensation of Manager’s employees with its shares from time to time, after specific for each such time, decision by the compensation committee and the Board of Directors in order to provide a means of compensation in the form of free shares to certain employees of the Manager of the Company’s common stock. The plan was effective as of December 31, 2008. Pursuant to the terms of the plan, employees of the Manager may receive (from time to time) shares of the Company’s common stock as additional compensation for their services offered during the preceding period. The total amount of stock to be granted to employees of the Manager will be at the Company’s Board of Directors’ discretion only and there will be no contractual obligation for any stock to be granted as part of the employees’ compensation package in future periods. During the six months ended June 30, 2019, the Company did not grant any shares under the plan. During the six months ended June 30, 2019, no new shares were issued. The Company has also established the Directors Share Payment Plan under its 2006 equity compensation plan. The purpose of the plan is to provide a means of payment of all or a portion of compensation payable to directors of the Company in the form of Company’s Common Stock. The plan was effective as of April 18, 2008. Each member of the Board of Directors of the Company may participate in the plan. Pursuant to the terms of the plan, directors may elect to receive in Common Stock all or a portion of their compensation. Following December 31 of each year, the Company delivers to each Director the number of shares represented by the rights credited to their Share Payment Account during the preceding calendar year. During the six months ended June 30, 2019 and June 30, 2018, none of the directors elected to receive their compensation in Company shares. On September 14, 2018, the Company granted 298,774 shares (4,182,832 shares before the 1-for-14 reverse stock split) of restricted stock to executive officers of the Company, 50% of which are scheduled to vest on December 31, 2019 and 50% of which are scheduled to vest on December 31, 2021. Additionally, on May 10, 2019, the Company granted 137,944 shares of restricted stock to certain employees of the Manager, out of which 135,738 are outstanding as of June 30, 2019 due to forfeiture of 2,206 shares, 50% of which restricted shares are scheduled to vest on December 31, 2019 and 50% of which are scheduled to vest on December 31, 2021. The issuance of these shares is subject to satisfaction of the vesting terms, under the Company’s 2006 Equity Compensation Plan, as amended. 434,512 shares and 298,774 shares of restricted stock are issued and outstanding as of June 30, 2019 and December 31, 2018, respectively. On May 2, 2019, the Company effected a 1-for-14 reverse stock split of the issued and outstanding shares of common stock of the Company. All share and per share data disclosed in the accompanying condensed consolidated financial statements (unaudited) give effect to this reverse stock split retroactively, for all periods presented. The reverse stock split reduced the number of the Company’s outstanding shares of common stock from 213,324,455 to 15,237,456 on May 2, 2019 and affected all issued and outstanding shares of common stock. No fractional shares were issued in connection to the reverse stock split. Stockholders who would otherwise hold a fractional share of the Company’s common stock received a cash payment in lieu of such fractional share. The par value and other terms of the Company’s common stock were not affected by the reverse stock split. The Company is not permitted to pay cash dividends under the terms of the 2018 debt refinancing until (1) the Company receives in excess of $50 million in net cash proceeds from offerings of Common Stock and (2) the payment in full of the first installment of amortization payable following the consummation of the debt refinancing under each new credit facility and provided that an event of default has not occurred and the Company is not, and after giving effect to the payment of the dividend, in breach of any covenant. |
Lease Arrangements
Lease Arrangements | 6 Months Ended |
Jun. 30, 2019 | |
Lease Arrangements | |
Lease Arrangements | 13 Lease Arrangements Charters-out The future minimum charter revenue, expected to be earned on non-cancellable time charters and bareboat charters classified as operating leases consisted of the following as of June 30, 2019 (in thousands): Remainder of 2019 $ 184,430 2020 362,091 2021 339,528 2022 268,529 2023 182,786 2024 and thereafter 119,284 Total future rentals $ 1,456,648 Revenue from time charters are not generally received when a vessel is off-hire, including time required for normal periodic maintenance of the vessel. In arriving at the future minimum rentals, an estimated time off-hire to perform periodic maintenance on each vessel has been deducted, although there is no assurance that such estimate will be reflective of the actual off-hire in the future. The off-hire assumptions used relate mainly to drydocking and special survey maintenance carried out approximately every 2.5 years per vessel, or every 5 years for vessels less than 15-years old, and which may last approximately 10 to 15 days. |
Earnings per Share
Earnings per Share | 6 Months Ended |
Jun. 30, 2019 | |
Earnings per Share | |
Earnings per Share | 14 Earnings per Share The following table sets forth the computation of basic and diluted earnings per share: Three months ended June 30, 2019 June 30, 2018 (in thousands) Numerator: Net income $ 30,138 $ 5,838 Denominator (number of shares in thousands): Basic weighted average common shares outstanding 14,939 7,843 Effect of dilutive securities: Share based compensation 375 — Diluted weighted average common shares outstanding 15,314 7,843 Six months ended June 30, 2019 June 30, 2018 (in thousands) Numerator: Net income $ 63,581 $ 20,830 Denominator (number of shares in thousands): Basic weighted average common shares outstanding 14,939 7,843 Effect of dilutive securities: Share based compensation 337 — Diluted weighted average common shares outstanding 15,276 7,843 The issued and outstanding 15,000,000 warrants to purchase shares of the Company’s common stock (on a pre-split basis), which expired in January 2019, were excluded from the diluted earnings/(loss) per share for the three and six months ended June 30, 2019 and 2018, as applicable before the expiry because they were antidilutive. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions | |
Related Party Transactions | 15 Related Party Transactions Management fees to Danaos Shipping Company Limited ("the Manager") amounted to $8.3 million in the six months ended June 30, 2019 and 2018, and are presented under "General and administrative expenses" in the condensed consolidated statements of income. Commissions to the Manager amounted to $2.7 million and $2.5 million in the six months ended June 30, 2019 and 2018, respectively and are presented under “Voyage expenses” in the condensed consolidated statements of income. The balance “Due from related parties” in the condensed consolidated balance sheets totaling $20.1 million and $18.0 million as of June 30, 2019 and December 31, 2018, respectively, represents advances to the Manager on account of the vessels’ operating and other expenses. An amount $0.6 million as of June 30, 2019 and December 31, 2018 was due to executive officers and is presented under “Accounts payable” in the condensed consolidated balance sheets. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
Significant Accounting Policies | |
Changes in Accounting Principles | Changes in Accounting Principles: Leases In February 2016, the FASB issued Accounting Standards Update No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). ASU 2016-02 applies to both types of leases – capital (or finance) leases and operating leases. According to the new Accounting Standard, lessees are required to recognize assets and liabilities on the balance sheet for the rights and obligations created by all leases with terms of more than 12 months. This guidance requires companies to identify lease and non-lease components of a lease agreement. Lease components relate to the right to use the leased asset and non-lease components relate to payments for goods or services that are transferred separately from the right to use the underlying asset. Total lease consideration is allocated to lease and non-lease components on a relative standalone basis. The recognition of revenues related to lease components are governed by ASC 842 while revenue related to non-lease components are subject to ASC 606. In March 2018, the FASB tentatively approved a proposed amendment to ASU 842, that provide entities the optional transition method to initially account for the impact of the adoption with a cumulative adjustment to retained earnings on the effective date of the ASU. In addition, lessors can elect, as a practical expedient, not to allocate the total consideration to lease and non-lease components based on their relative standalone selling prices. As adopted by the Accounting Standards Update No. 2018-11 in July 2018, this practical expedient allows lessors to elect and account for the combined component based on its predominant characteristic. ASC 842 provides practical expedients that allow entities to not (i) reassess whether any expired or existing contracts are considered or contain leases; (ii) reassess the lease classification for any expired or existing leases; and (iii) reassess initial direct costs for any existing leases. In July 2018, the FASB issued Accounting Standards Update No. 2018-10, “Codification Improvements to Topic 842, Leases” and in December 2018 the Accounting Standards Update No. 2018-20 “Narrow-scope improvements for lessors”, which further improve and clarify ASU 2016-02. The Company adopted this standard on January 1, 2019 using the modified retrospective method. The Company derives its revenue from the time charters and bareboat charters of its vessels that are classified as operating leases. These charters involve placing the vessels at charterers use for a period of time in return for daily hire rates, which include lease component related to the right of use of the vessels and non-lease components primarily related to the operating expenses of the vessels paid by the Company. The revenue earned based on these charters is not negotiated in separate components. The Company elected the practical expedient to use the effective date of adoption as the date of initial application. Furthermore the Company elected practical expedients, which allow entities not (i) reassess whether any expired or existing contracts are considered or contain leases; (ii) reassess the lease classification for any expired or existing leases (iii) reassess initial direct costs for any existing leases and (iv) which allows to treat the lease and non-lease components as a single lease component provided the criteria are met. The adoption of this standard did not have a material effect on the condensed consolidated financial statements since the Company is primarily a lessor and the accounting for lessors is largely unchanged under this standard. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements: In June 2016, the FASB issued ASU 2016-13, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”), which amends the impairment model by requiring entities to use a forward-looking approach based on expected losses to estimate credit losses on certain types of financial instruments, including trade receivables. In December 2018, the FASB issued Accounting Standards Update No. 2018-19 "Codification improvements to Topic 326", which clarifies that impairment of receivables arising from operating leases should be accounted for in accordance with Topic 842, Leases. The ASU 2016-13 is effective for public entities for fiscal years beginning after December 15, 2019, with early adoption permitted. The Company is currently evaluating the impact of the new standard on the Company’s consolidated financial statements. |
Basis of Presentation and Gen_2
Basis of Presentation and General Information (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Basis of Presentation and General Information | |
Schedule of the vessel owning companies (the "Danaos Subsidiaries") | As of June 30, 2019, Danaos included the vessel owning companies (the “Danaos Subsidiaries”) listed below. All vessels are container vessels: Company Date of Incorporation Vessel Name Year Built TEU (1) Megacarrier (No. 1) Corp. September 10, 2007 Hyundai Honour 13,100 Megacarrier (No. 2) Corp. September 10, 2007 Hyundai Respect 13,100 Megacarrier (No. 3) Corp. September 10, 2007 Maersk Enping 13,100 Megacarrier (No. 4) Corp. September 10, 2007 Maersk Exeter 13,100 Megacarrier (No. 5) Corp. September 10, 2007 MSC Ambition 13,100 CellContainer (No. 6) Corp. October 31, 2007 Express Berlin 10,100 CellContainer (No. 7) Corp. October 31, 2007 Express Rome 10,100 CellContainer (No. 8) Corp. October 31, 2007 Express Athens 10,100 Karlita Shipping Co. Ltd. February 27, 2003 Pusan C 9,580 Ramona Marine Co. Ltd. February 27, 2003 Le Havre 9,580 Teucarrier (No. 5) Corp. September 17, 2007 CMA CGM Melisande 8,530 Teucarrier (No. 1) Corp. January 31, 2007 CMA CGM Attila 8,530 Teucarrier (No. 2) Corp. January 31, 2007 CMA CGM Tancredi 8,530 Teucarrier (No. 3) Corp. January 31, 2007 CMA CGM Bianca 8,530 Teucarrier (No. 4) Corp. January 31, 2007 CMA CGM Samson 8,530 Oceanew Shipping Ltd. January 14, 2002 Europe 8,468 Oceanprize Navigation Ltd. January 21, 2003 America 8,468 Boxcarrier (No. 2) Corp. June 27, 2006 CMA CGM Musset 6,500 Boxcarrier (No. 3) Corp. June 27, 2006 CMA CGM Nerval 6,500 Boxcarrier (No. 4) Corp. June 27, 2006 CMA CGM Rabelais 6,500 Boxcarrier (No. 5) Corp. June 27, 2006 CMA CGM Racine 6,500 Boxcarrier (No. 1) Corp. June 27, 2006 CMA CGM Moliere 6,500 Expresscarrier (No. 1) Corp. March 5, 2007 YM Mandate 6,500 Expresscarrier (No. 2) Corp. March 5, 2007 YM Maturity 6,500 Actaea Company Limited October 14, 2014 Performance 6,402 Asteria Shipping Company Limited October 14, 2014 Dimitra C 6,402 Continent Marine Inc. March 22, 2006 Zim Monaco 4,253 Medsea Marine Inc. May 8, 2006 Zim Dalian 4,253 Blacksea Marine Inc. May 8, 2006 Zim Luanda 4,253 Bayview Shipping Inc. March 22, 2006 Zim Rio Grande 4,253 Channelview Marine Inc. March 22, 2006 Zim Sao Paolo 4,253 Balticsea Marine Inc. March 22, 2006 Zim Kingston 4,253 Seacarriers Services Inc. June 28, 2005 YM Seattle 4,253 Seacarriers Lines Inc. June 28, 2005 YM Vancouver 4,253 Containers Services Inc. May 30, 2002 ANL Tongala 4,253 Containers Lines Inc. May 30, 2002 Derby D 4,253 Boulevard Shiptrade S.A September 12, 2013 Dimitris C 3,430 CellContainer (No. 4) Corp. March 23, 2007 Express Spain 3,400 CellContainer (No. 5) Corp. March 23, 2007 Express Black Sea 3,400 CellContainer (No. 1) Corp. March 23, 2007 Express Argentina 3,400 CellContainer (No. 2) Corp. March 23, 2007 Express Brazil 3,400 CellContainer (No. 3) Corp. March 23, 2007 Express France 3,400 Wellington Marine Inc. January 27, 2005 Singapore 3,314 Auckland Marine Inc. January 27, 2005 Colombo 3,314 Vilos Navigation Company Ltd. May 30, 2013 MSC Zebra 2,602 Trindade Maritime Company April 10, 2013 Amalia C 2,452 Sarond Shipping Inc. January 18, 2013 Danae C 2,524 Speedcarrier (No. 7) Corp. December 6, 2007 Highway 2,200 Speedcarrier (No. 6) Corp. December 6, 2007 Progress C 2,200 Speedcarrier (No. 8) Corp. December 6, 2007 Bridge 2,200 Speedcarrier (No. 1) Corp. June 28, 2007 Vladivostok 2,200 Speedcarrier (No. 2) Corp. June 28, 2007 Advance 2,200 Speedcarrier (No. 3) Corp. June 28, 2007 Stride 2,200 Speedcarrier (No. 5) Corp. June 28, 2007 Future 2,200 Speedcarrier (No. 4) Corp. June 28, 2007 Sprinter 2,200 (1) Twenty-feet equivalent unit, the international standard measure for containers and containership capacity. |
Cash, Cash Equivalents and Re_2
Cash, Cash Equivalents and Restricted Cash (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Cash, Cash Equivalents and Restricted Cash | |
Schedule of cash, cash equivalents and restricted cash | Cash, cash equivalents and restricted cash consisted of the following (in thousands): As of As of As of June 30, 2019 December 31, 2018 December 31, 2017 Cash and cash equivalents $ 78,803 $ 77,275 $ 66,895 Restricted cash — — 2,812 Total $ 78,803 $ 77,275 $ 69,707 |
Fixed assets, net (Tables)
Fixed assets, net (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Fixed assets, net | |
Schedule of leaseback instalments | The scheduled leaseback instalments subsequent to June 30, 2019 are as follows (in thousands): Instalments due by period ended: June 30, 2020 $ 31,304 June 30, 2021 32,522 June 30, 2022 32,521 June 30, 2023 32,522 June 30, 2024 77,127 Total leaseback instalments 205,996 Less: Imputed interest (61,559) Total leaseback obligation 144,437 Less: Current leaseback obligation (14,097) Leaseback obligation, net of current portion $ 130,340 |
Deferred Charges, net (Tables)
Deferred Charges, net (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Deferred Charges, net | |
Schedule of deferred charges, net | Deferred charges, net consisted of the following (in thousands): Drydocking and Special Survey Costs As of January 1, 2018 $ 8,962 Additions 13,306 Amortization (9,237) As of December 31, 2018 13,031 Additions 1,690 Amortization (4,254) As of June 30, 2019 $ 10,467 |
Investments in affiliates (Tabl
Investments in affiliates (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Investments in affiliates | |
Consolidated wholly owned subsidiaries | As of June 30, 2019, Gemini consolidated its wholly owned subsidiaries listed below: Year Date of vessel Company Vessel Name Built TEU delivery Averto Shipping S.A. Suez Canal 2002 5,610 July 20, 2015 Sinoi Marine Ltd. Genoa 2002 5,544 August 2, 2015 Kingsland International Shipping Limited Catherine C 2001 6,422 September 21, 2015 Leo Shipping and Trading S.A. Leo C 2002 6,422 February 4, 2016 Springer Shipping Co — — — — |
Summary of the financial information for equity accounted investments | A condensed summary of the financial information for equity accounted investments 49% owned by the Company shown on a 100% basis are as follows (in thousands): As of As of June 30, 2019 December 31, 2018 Current assets $ 4,355 $ 8,327 Non-current assets $ 45,173 $ 41,155 Current liabilities $ 9,252 $ 5,201 Non-current liabilities $ 25,355 $ 29,254 Six months ended Six months ended June 30, 2019 June 30, 2018 Net operating revenues $ 7,451 $ 8,625 Net income/(loss) $ (106) $ 376 |
Other Non-current Assets (Table
Other Non-current Assets (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Other Non-current Assets | |
Schedule of other non-current assets | Other non-current assets consisted of the following (in thousands): As of As of June 30, 2019 December 31, 2018 Available for sale securities: ZIM notes, net $ 19,733 $ 21,044 HMM notes, net 8,678 7,847 Equity participation ZIM — — Advances for vessels additions $ 14,851 $ 5,420 Other assets 30,669 25,058 Total $ 73,931 $ 59,369 |
Schedule of available for sale securities at fair value and unrealized losses | The unrealized losses, which were recognized in other comprehensive loss, are analyzed as follows as of June 30, 2019 (in thousands): Amortized cost Description of securities basis Fair value Unrealized loss ZIM notes $ 45,899 $ 19,733 $ (26,166) HMM notes 21,516 8,678 (12,838) Total $ 67,415 $ 28,411 $ (39,004) |
Schedule of unrealized loss on available for sale securities | The unrealized losses, which were recognized in other comprehensive loss, are analyzed as follows as of June 30, 2019 (in thousands): Unrealized loss on available for sale securities Beginning balance as of January 1, 2019 $ (36,378) Unrealized loss on available for sale securities 2019 (2,626) Ending balance as of June 30, 2019 $ (39,004) |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Accrued Liabilities | |
Schedule of accrued liabilities | Accrued liabilities consisted of the following (in thousands): As of As of June 30, 2019 December 31, 2018 Accrued payroll $ 830 $ 924 Accrued interest 4,896 6,304 Accrued expenses 5,039 4,542 Total $ 10,765 $ 11,770 |
Long-Term Debt, net (Tables)
Long-Term Debt, net (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Long-Term Debt, net | |
Schedule of long-term debt, net | Long-term debt, net consisted of the following (in thousands): Balance as of Balance as of Credit Facility June 30, 2019 December 31, 2018 The Royal Bank of Scotland $475.5 mil. Facility $ 466,789 $ 474,743 HSH Nordbank AG - Aegean Baltic Bank - Piraeus Bank $382.5 mil. Facility 376,001 379,762 Citibank $114 mil. Facility 79,143 110,644 Credit Suisse $171.8 mil. Facility 121,710 167,990 Citibank – Eurobank $37.6 mil. Facility 31,539 35,544 Club Facility $206.2 mil. 147,965 202,439 Sinosure Cexim - Citibank - ABN Amro $203.4 mil. Facility 50,850 61,020 Citibank $123.9 mil. Facility 90,435 122,523 Citibank $120 mil. Facility 107,110 115,973 Fair value of debt (22,831) (26,065) Comprehensive Financing Plan exit fees accrued 21,879 21,583 Total long-term debt $ 1,470,590 $ 1,666,156 Less: Deferred finance costs, net (38,557) (44,271) Less: Current portion (113,826) (113,777) Total long-term debt net of current portion and deferred finance cost $ 1,318,207 $ 1,508,108 |
Schedule of debt maturities of long-term debt | The scheduled debt maturities of total long-term debt subsequent to June 30, 2019 are as follows (in thousands): Fixed principal Total Payments due by period ended repayments Final payments* principal payments June 30, 2020 $ 113,826 — $ 113,826 June 30, 2021 119,084 — 119,084 June 30, 2022 105,927 — 105,927 June 30, 2023 85,222 — 85,222 June 30, 2024 35,879 $ 1,011,604 1,047,483 Total long-term debt $ 459,938 $ 1,011,604 $ 1,471,542 * The final payments include the unamortized remaining principal debt balances under the New 2018 Credit Facilities, as such amount will be determinable following the fixed amortization. As mentioned above, the Company is also subject to quarterly variable principal amortization based on actual free cash flows, which are included under “Final payments” in this table. |
Financial Instruments (Tables)
Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Financial Instruments | |
Schedule of estimated fair values of the financial instruments | As of June 30, 2019 As of December 31, 2018 Book Value Fair Value Book Value Fair Value (in thousands of $) Cash and cash equivalents $ 78,803 $ 78,803 $ 77,275 $ 77,275 Due from related parties $ 20,084 $ 20,084 $ 17,970 $ 17,970 ZIM notes $ 19,733 $ 19,733 $ 21,044 $ 21,044 HMM notes $ 8,678 $ 8,678 $ 7,847 $ 7,847 Equity investment in ZIM — — — — Long-term debt, including current portion $ 1,470,590 $ 1,470,590 $ 1,666,156 $ 1,666,156 |
Schedule of estimated fair value of the financial instruments, categorized based upon the fair value hierarchy | The estimated fair value of the financial instruments that are measured at fair value on a recurring basis, categorized based upon the fair value hierarchy, are as follows as of June 30, 2019: Fair Value Measurements as of June 30, 2019 Total (Level I) (Level II) (Level III) (in thousands of $) ZIM notes(1) $ 19,733 $ — $ 19,733 $ — HMM notes(1) $ 8,678 $ — $ 8,678 $ — The estimated fair value of the financial instruments that are not measured at fair value on a recurring basis, categorized based upon the fair value hierarchy, are as follows as of June 30, 2019: Fair Value Measurements as of June 30, 2019 Total (Level I) (Level II) (Level III) (in thousands of $) Long-term debt, including current portion(2) $ 1,470,590 $ — $ 1,470,590 $ — The estimated fair value of the financial instruments that are measured at fair value on a recurring basis, categorized based upon the fair value hierarchy, are as follows as of December 31, 2018: Fair Value Measurements as of December 31, 2018 Total (Level I) (Level II) (Level III) (in thousands of $) ZIM notes(1) $ 21,044 $ — $ 21,044 $ — HMM notes(1) $ 7,847 $ — $ 7,847 $ — The estimated fair value of the financial instruments that are not measured at fair value on a recurring basis, categorized based upon the fair value hierarchy, are as follows as of December 31, 2018: Fair Value Measurements as of December 31, 2018 Total (Level I) (Level II) (Level III) (in thousands of $) Long-term debt, including current portion(2) $ 1,666,156 $ — $ 1,666,156 $ — (1) (2) |
Lease Arrangements (Tables)
Lease Arrangements (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Lease Arrangements | |
Schedule of future minimum rentals, expected to be earned on non cancellable time charters | The future minimum charter revenue, expected to be earned on non-cancellable time charters and bareboat charters classified as operating leases consisted of the following as of June 30, 2019 (in thousands): Remainder of 2019 $ 184,430 2020 362,091 2021 339,528 2022 268,529 2023 182,786 2024 and thereafter 119,284 Total future rentals $ 1,456,648 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Earnings per Share | |
Schedule of computation of basic and diluted earnings per share | The following table sets forth the computation of basic and diluted earnings per share: Three months ended June 30, 2019 June 30, 2018 (in thousands) Numerator: Net income $ 30,138 $ 5,838 Denominator (number of shares in thousands): Basic weighted average common shares outstanding 14,939 7,843 Effect of dilutive securities: Share based compensation 375 — Diluted weighted average common shares outstanding 15,314 7,843 Six months ended June 30, 2019 June 30, 2018 (in thousands) Numerator: Net income $ 63,581 $ 20,830 Denominator (number of shares in thousands): Basic weighted average common shares outstanding 14,939 7,843 Effect of dilutive securities: Share based compensation 337 — Diluted weighted average common shares outstanding 15,276 7,843 |
Basis of Presentation and Gen_3
Basis of Presentation and General Information (Details) | May 02, 2019shares | Dec. 31, 2018$ / sharesshares | Jun. 30, 2019item$ / sharesshares |
Property, Plant and Equipment | |||
Common stock, authorized capital stock (in shares) | shares | 750,000,000 | 750,000,000 | |
Common stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | |
Preferred stock, authorized capital stock (in shares) | shares | 100,000,000 | 100,000,000 | |
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | |
Number of shares issued for one share under reverse stock split | 0.0714 | 0.0714 | |
Common stock, shares outstanding before reverse stock split | shares | 213,324,455 | (213,324,455) | |
Common stock, shares outstanding | shares | 15,237,456 | 15,237,456 | 15,373,194 |
Hyundai Honour | |||
Property, Plant and Equipment | |||
TEU | 13,100 | ||
Hyundai Respect | |||
Property, Plant and Equipment | |||
TEU | 13,100 | ||
Maersk Enping | |||
Property, Plant and Equipment | |||
TEU | 13,100 | ||
Maersk Exeter | |||
Property, Plant and Equipment | |||
TEU | 13,100 | ||
MSC Ambition | |||
Property, Plant and Equipment | |||
TEU | 13,100 | ||
Express Berlin | |||
Property, Plant and Equipment | |||
TEU | 10,100 | ||
Express Rome | |||
Property, Plant and Equipment | |||
TEU | 10,100 | ||
Express Athens | |||
Property, Plant and Equipment | |||
TEU | 10,100 | ||
Pusan C | |||
Property, Plant and Equipment | |||
TEU | 9,580 | ||
Le Havre | |||
Property, Plant and Equipment | |||
TEU | 9,580 | ||
CMA CGM Melisande | |||
Property, Plant and Equipment | |||
TEU | 8,530 | ||
CMA CGM Attila | |||
Property, Plant and Equipment | |||
TEU | 8,530 | ||
CMA CGM Tancredi | |||
Property, Plant and Equipment | |||
TEU | 8,530 | ||
CMA CGM Bianca | |||
Property, Plant and Equipment | |||
TEU | 8,530 | ||
CMA CGM Samson | |||
Property, Plant and Equipment | |||
TEU | 8,530 | ||
Europe | |||
Property, Plant and Equipment | |||
TEU | 8,468 | ||
America | |||
Property, Plant and Equipment | |||
TEU | 8,468 | ||
CMA CGM Musset | |||
Property, Plant and Equipment | |||
TEU | 6,500 | ||
CMA CGM Nerval | |||
Property, Plant and Equipment | |||
TEU | 6,500 | ||
CMA CGM Rabelais | |||
Property, Plant and Equipment | |||
TEU | 6,500 | ||
CMA CGM Racine | |||
Property, Plant and Equipment | |||
TEU | 6,500 | ||
CMA CGM Moliere | |||
Property, Plant and Equipment | |||
TEU | 6,500 | ||
YM Mandate | |||
Property, Plant and Equipment | |||
TEU | 6,500 | ||
YM Maturity | |||
Property, Plant and Equipment | |||
TEU | 6,500 | ||
Performance | |||
Property, Plant and Equipment | |||
TEU | 6,402 | ||
Dimitra C | |||
Property, Plant and Equipment | |||
TEU | 6,402 | ||
Zim Monaco | |||
Property, Plant and Equipment | |||
TEU | 4,253 | ||
Zim Dalian | |||
Property, Plant and Equipment | |||
TEU | 4,253 | ||
Zim Luanda | |||
Property, Plant and Equipment | |||
TEU | 4,253 | ||
Zim Rio Grande | |||
Property, Plant and Equipment | |||
TEU | 4,253 | ||
Zim Sao Paolo | |||
Property, Plant and Equipment | |||
TEU | 4,253 | ||
Zim Kingston | |||
Property, Plant and Equipment | |||
TEU | 4,253 | ||
YM Seattle | |||
Property, Plant and Equipment | |||
TEU | 4,253 | ||
YM Vancouver | |||
Property, Plant and Equipment | |||
TEU | 4,253 | ||
ANL Tongala | |||
Property, Plant and Equipment | |||
TEU | 4,253 | ||
Derby D | |||
Property, Plant and Equipment | |||
TEU | 4,253 | ||
Dimitris C | |||
Property, Plant and Equipment | |||
TEU | 3,430 | ||
Express Spain | |||
Property, Plant and Equipment | |||
TEU | 3,400 | ||
Express Black Sea | |||
Property, Plant and Equipment | |||
TEU | 3,400 | ||
Express Argentina | |||
Property, Plant and Equipment | |||
TEU | 3,400 | ||
Express Brazil | |||
Property, Plant and Equipment | |||
TEU | 3,400 | ||
Express France | |||
Property, Plant and Equipment | |||
TEU | 3,400 | ||
Singapore | |||
Property, Plant and Equipment | |||
TEU | 3,314 | ||
Colombo | |||
Property, Plant and Equipment | |||
TEU | 3,314 | ||
MSC Zebra | |||
Property, Plant and Equipment | |||
TEU | 2,602 | ||
Amalia C | |||
Property, Plant and Equipment | |||
TEU | 2,452 | ||
Danae C | |||
Property, Plant and Equipment | |||
TEU | 2,524 | ||
Highway | |||
Property, Plant and Equipment | |||
TEU | 2,200 | ||
Progress C | |||
Property, Plant and Equipment | |||
TEU | 2,200 | ||
Bridge | |||
Property, Plant and Equipment | |||
TEU | 2,200 | ||
Vladivostok | |||
Property, Plant and Equipment | |||
TEU | 2,200 | ||
Advance | |||
Property, Plant and Equipment | |||
TEU | 2,200 | ||
Stride | |||
Property, Plant and Equipment | |||
TEU | 2,200 | ||
Future | |||
Property, Plant and Equipment | |||
TEU | 2,200 | ||
Sprinter | |||
Property, Plant and Equipment | |||
TEU | 2,200 |
Cash, Cash Equivalents and Re_3
Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 | Jun. 30, 2018 | Dec. 31, 2017 |
Cash, Cash Equivalents and Restricted Cash | ||||
Cash and cash equivalents | $ 78,803 | $ 77,275 | $ 66,895 | |
Restricted cash | 2,812 | |||
Total | $ 78,803 | $ 77,275 | $ 75,235 | 69,707 |
The Export-Import Bank of Korea & ABN Amro | ||||
Cash, Cash Equivalents and Restricted Cash | ||||
Restricted cash | $ 2,800 |
Fixed assets, net (Details)
Fixed assets, net (Details) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019USD ($)$ / T | Dec. 31, 2018USD ($)item | |
Instalments due by period ended: | ||
Less: Current leaseback obligation | $ 14,097 | |
Leaseback obligation, net of current portion | 130,340 | |
Citibank $114 mil. Facility | ||
Fixed Assets, Net | ||
Credit facility | 114,000 | |
Citibank $123.9 mil. Facility | ||
Fixed Assets, Net | ||
Credit facility | 123,900 | |
Vessels | ||
Fixed Assets, Net | ||
Impairment loss of vessels held and used | $ 210,700 | |
Number of vessels on which impairment loss is recorded | item | 10 | |
Residual value of the fleet | $ 378,200 | $ 378,200 |
Average life of scrap considered to calculate residual value of vessel, one | 10 years | |
Average life of scrap considered to calculate residual value of vessel, two | 5 years | |
Scrap value per ton (in dollars per ton) | $ / T | 300 | |
Vessels to be refinanced | item | 2 | |
Instalments due by period ended: | ||
June 30, 2020 | $ 31,304 | |
June 30, 2021 | 32,522 | |
June 30, 2022 | 32,521 | |
June 30, 2023 | 32,522 | |
June 30, 2024 | 77,127 | |
Total leaseback instalments | 205,996 | |
Less: Imputed interest | 61,559 | |
Total leaseback obligation | 144,437 | |
Less: Current leaseback obligation | 14,097 | |
Leaseback obligation, net of current portion | $ 130,340 | |
Hyundai Honour | ||
Fixed Assets, Net | ||
TEU | item | 13,100 | |
Hyundai Respect | ||
Fixed Assets, Net | ||
TEU | item | 13,100 | |
Hyundai Honour And Hyundai Respect | ||
Fixed Assets, Net | ||
Sale and leaseback arrangement term (in years) | 5 years | |
Repurchase price | $ 52,600 | |
Net proceeds | $ 144,800 |
Deferred Charges, net (Details)
Deferred Charges, net (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Changes in deferred charges, net | ||
Balance at the beginning of the period | $ 13,031 | $ 8,962 |
Additions | 1,690 | 13,306 |
Amortization | (4,254) | (9,237) |
Balance at the end of the period | $ 10,467 | $ 13,031 |
Period of amortization for deferred costs | 2 years 6 months |
Investments in affiliates - Who
Investments in affiliates - Wholly Owned Subsidiaries (Details) $ in Millions | May 29, 2019USD ($)item | Aug. 31, 2015USD ($) | Jun. 30, 2019USD ($)item |
Gemini | |||
Schedule of Equity Method Investments | |||
Ownership (as a percent) | 49.00% | 49.00% | |
Gemini | |||
Schedule of Equity Method Investments | |||
Capital lease obligations assumed | $ 35.4 | ||
Borrowings under a secured loan facility | 19 | ||
Proceeds from equity contributions | $ 47.4 | ||
TEU of vessel acquired | item | 8,500 | ||
Gross purchase price | $ 25.3 | ||
Amount of advance made | $ 2.5 | ||
Net assets | $ 14.9 | ||
Gemini | Suez Canal | |||
Schedule of Equity Method Investments | |||
TEU | item | 5,610 | ||
Gemini | Genoa | |||
Schedule of Equity Method Investments | |||
TEU | item | 5,544 | ||
Gemini | Catherine C | |||
Schedule of Equity Method Investments | |||
TEU | item | 6,422 | ||
Gemini | Leo | |||
Schedule of Equity Method Investments | |||
TEU | item | 6,422 | ||
Gemini | Entities that leases Suez Canal and Genoa and owns Catherine C ( ex NYK Lodestar) | |||
Schedule of Equity Method Investments | |||
Acquired interest | 100.00% | ||
Virage | Gemini | |||
Schedule of Equity Method Investments | |||
Ownership (as a percent) | 51.00% |
Investments in affiliates - Equ
Investments in affiliates - Equity Accounted Investments (Details) - Gemini - USD ($) $ in Thousands | 1 Months Ended | 6 Months Ended | ||
Aug. 31, 2015 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Summary of financial information | ||||
Ownership (as a percent) | 49.00% | 49.00% | ||
Current assets | $ 4,355 | $ 8,327 | ||
Non-current assets | 45,173 | 41,155 | ||
Current liabilities | 9,252 | 5,201 | ||
Long-term liabilities | 25,355 | $ 29,254 | ||
Net operating revenues | 7,451 | $ 8,625 | ||
Net income/(loss) | $ (106) | $ 376 |
Other Non-current Assets (Detai
Other Non-current Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 | Dec. 31, 2016 |
Other Non-current Assets | |||
Advances for vessels additions | $ 14,851 | $ 5,420 | |
Other assets | 30,669 | 25,058 | |
Total | 73,931 | 59,369 | |
ZIM notes | |||
Other Non-current Assets | |||
Available for sale securities | 19,733 | 21,044 | |
HMM notes | |||
Other Non-current Assets | |||
Available for sale securities | $ 8,678 | $ 7,847 | |
Equity participation | ZIM | |||
Other Non-current Assets | |||
Equity participation ZIM | $ 0 |
Other Non-current Assets - ZIM
Other Non-current Assets - ZIM (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2016 | Jul. 31, 2016 | Jul. 31, 2014 | |
Notes | ZIM | |||
Other Non-current Assets | |||
Impairment loss at reporting date | $ 0.7 | ||
Series 1 Notes | ZIM | |||
Other Non-current Assets | |||
Principal amount of unsecured notes received | $ 8.8 | ||
Series 2 Notes | ZIM | |||
Other Non-current Assets | |||
Principal amount of unsecured notes received | $ 41.1 | ||
Loan Notes 1 HMM | HMM | |||
Other Non-current Assets | |||
Principal amount of unsecured notes received | $ 32.8 | ||
Loan Notes 2 HMM | HMM | |||
Other Non-current Assets | |||
Principal amount of unsecured notes received | $ 6.2 | ||
Equity participation | ZIM | |||
Other Non-current Assets | |||
Impairment loss at reporting date | 28.7 | ||
Equity participation ZIM | $ 0 |
Other Non-current Assets - Tran
Other Non-current Assets - Transfer to Available for sale category (Details) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2019USD ($)item | Dec. 31, 2019USD ($) | Dec. 31, 2018USD ($) | |
Available for sale securities at fair value and unrealized losses | |||
Amortized cost basis | $ 67,415 | ||
Fair value | 28,411 | ||
Unrealized loss on available for sale securities | (39,004) | ||
Unrealized loss on available for sale securities | |||
Beginning balance, Unrealized loss on available for sale securities | (36,378) | $ (36,378) | |
Unrealized loss on available for sale securities | (2,626) | ||
Ending balance, Unrealized loss on available for sale securities | $ (39,004) | $ (36,378) | |
Number of vessels to install scrubbers | item | 9 | ||
Estimated cost of scrubbers | $ 27,900 | ||
Advances for scrubbers installation | 13,200 | ||
Straight-lining of company's revenue | 29,900 | $ 23,100 | |
Expected | |||
Unrealized loss on available for sale securities | |||
Payment of scrubbers installation cost | $ 14,700 | ||
ZIM notes | |||
Available for sale securities at fair value and unrealized losses | |||
Amortized cost basis | 45,899 | ||
Fair value | 19,733 | ||
Unrealized loss on available for sale securities | (26,166) | ||
HMM notes | |||
Available for sale securities at fair value and unrealized losses | |||
Amortized cost basis | 21,516 | ||
Fair value | 8,678 | ||
Unrealized loss on available for sale securities | $ (12,838) |
Accrued Liabilities (Details)
Accrued Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Accrued Liabilities | ||
Accrued payroll | $ 830 | $ 924 |
Accrued interest | 4,896 | 6,304 |
Accrued expenses | 5,039 | 4,542 |
Total | $ 10,765 | $ 11,770 |
Long-Term Debt, net - Schedule
Long-Term Debt, net - Schedule of Debt (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Long-Term Debt, net | ||
Fair value of debt | $ (22,831) | $ (26,065) |
Comprehensive Financing Plan exit fees accrued | 21,879 | 21,583 |
Total long-term debt | 1,470,590 | 1,666,156 |
Less: Deferred finance costs, net | (38,557) | (44,271) |
Less: Current portion | (113,826) | (113,777) |
Total long-term debt net of current portion and deferred finance cost | 1,318,207 | 1,508,108 |
Remaining borrowing availability | 0 | |
The Royal Bank of Scotland | ||
Long-Term Debt, net | ||
Long-term debt | 466,789 | 474,743 |
Credit facility | 475,500 | |
HSH Nordbank AG-Aegean Baltic Bank-Piraeus Bank | ||
Long-Term Debt, net | ||
Long-term debt | 376,001 | 379,762 |
Credit facility | 382,500 | |
Citibank $114 mil. Facility | ||
Long-Term Debt, net | ||
Long-term debt | 79,143 | 110,644 |
Credit facility | 114,000 | |
Credit Suisse | ||
Long-Term Debt, net | ||
Long-term debt | 121,710 | 167,990 |
Credit facility | 171,800 | |
Citibank-Eurobank Credit Facility | ||
Long-Term Debt, net | ||
Long-term debt | 31,539 | 35,544 |
Credit facility | 37,600 | |
Club Facility | ||
Long-Term Debt, net | ||
Long-term debt | 147,965 | 202,439 |
Credit facility | 206,200 | |
Sinosure cexim-Citibank-ABN Amro Credit Facility | ||
Long-Term Debt, net | ||
Long-term debt | 50,850 | 61,020 |
Credit facility | $ 203,400 | |
Percentage of payments to free cash flows | 85.00% | |
Citibank $123.9 mil. Facility | ||
Long-Term Debt, net | ||
Long-term debt | $ 90,435 | 122,523 |
Credit facility | 123,900 | |
Citibank $120 mil. Facility | ||
Long-Term Debt, net | ||
Long-term debt | 107,110 | $ 115,973 |
Credit facility | $ 120,000 |
Long-Term Debt, net - Maturitie
Long-Term Debt, net - Maturities (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Scheduled maturities of long-term debt | |||
June 30, 2020 | $ 113,826 | ||
June 30, 2021 | 119,084 | ||
June 30, 2022 | 105,927 | ||
June 30, 2023 | 85,222 | ||
June 30, 2024 | 1,047,483 | ||
Total long-term debt | 1,471,542 | ||
Other current liabilities | |||
Debt refinancing discussion | |||
Unpaid loan amendment fees | 17,800 | $ 30,500 | |
Other long-term liabilities | |||
Debt refinancing discussion | |||
Unpaid loan amendment fees | 7,400 | $ 14,800 | |
Other income/(expenses), net | |||
Debt refinancing discussion | |||
Professional fees related to refinancing discussions with lenders | 0 | $ 29,700 | |
Fixed principal repayments | |||
Scheduled maturities of long-term debt | |||
June 30, 2020 | 113,826 | ||
June 30, 2021 | 119,084 | ||
June 30, 2022 | 105,927 | ||
June 30, 2023 | 85,222 | ||
June 30, 2024 | 35,879 | ||
Total long-term debt | 459,938 | ||
Final payments | |||
Scheduled maturities of long-term debt | |||
June 30, 2024 | 1,011,604 | ||
Total long-term debt | $ 1,011,604 |
Financial Instruments - Interes
Financial Instruments - Interest Rate Swap Hedges (Details) - Interest rate swap hedges $ in Millions | 6 Months Ended | |
Jun. 30, 2019USD ($)agreement | Jun. 30, 2018USD ($) | |
Financial Instruments | ||
Number of agreements held | agreement | 0 | |
Unrealized losses reclassified from accumulated other comprehensive loss to earnings | $ 1.8 | $ 1.8 |
Unrealized losses expected to be reclassified from accumulated other comprehensive loss to earnings within the next twelve months | $ 3.6 |
Financial Instruments - Estimat
Financial Instruments - Estimated Fair Values Of Financial Instruments (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Book Value | ||
Financial Instruments | ||
Cash and cash equivalents | $ 78,803 | $ 77,275 |
Due from related parties | 20,084 | 17,970 |
Long-term debt, including current portion | 1,470,590 | 1,666,156 |
Fair Value | ||
Financial Instruments | ||
Cash and cash equivalents | 78,803 | 77,275 |
Due from related parties | 20,084 | 17,970 |
Long-term debt, including current portion | 1,470,590 | 1,666,156 |
Notes | ZIM | Book Value | ||
Financial Instruments | ||
Notes | 19,733 | 21,044 |
Notes | ZIM | Fair Value | ||
Financial Instruments | ||
Notes | 19,733 | 21,044 |
Notes | HMM | Book Value | ||
Financial Instruments | ||
Notes | 8,678 | 7,847 |
Notes | HMM | Fair Value | ||
Financial Instruments | ||
Notes | $ 8,678 | $ 7,847 |
Financial Instruments - Financi
Financial Instruments - Financial Instruments Measured and Not Measured At Fair Value On Recurring Basis (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Financial instruments measured at fair value | ||
Deferred finance costs, net | $ 38,600 | $ 44,300 |
Fair Value | ||
Financial instruments measured at fair value | ||
Long-term debt, including current portion | 1,470,590 | 1,666,156 |
Non-recurring basis | Level II | ||
Financial instruments measured at fair value | ||
Long-term debt, including current portion | 1,470,590 | 1,666,156 |
Non-recurring basis | Fair Value | ||
Financial instruments measured at fair value | ||
Long-term debt, including current portion | 1,470,590 | 1,666,156 |
Notes | ZIM | Fair Value | ||
Financial instruments measured at fair value | ||
Notes | 19,733 | 21,044 |
Notes | ZIM | Recurring basis | Level II | ||
Financial instruments measured at fair value | ||
Notes | 19,733 | 21,044 |
Notes | ZIM | Recurring basis | Fair Value | ||
Financial instruments measured at fair value | ||
Notes | 19,733 | 21,044 |
Notes | HMM | Fair Value | ||
Financial instruments measured at fair value | ||
Notes | 8,678 | 7,847 |
Notes | HMM | Recurring basis | Level II | ||
Financial instruments measured at fair value | ||
Notes | 8,678 | 7,847 |
Notes | HMM | Recurring basis | Fair Value | ||
Financial instruments measured at fair value | ||
Notes | $ 8,678 | $ 7,847 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) $ in Thousands | May 10, 2019shares | May 02, 2019shares | Sep. 14, 2018shares | Aug. 10, 2018USD ($)shares | Jun. 30, 2019USD ($)directorshares | Jun. 30, 2018director | Dec. 31, 2018shares |
Stock Based Compensation | |||||||
Agreed contribution from stockholder | $ | $ 10,000 | ||||||
Number of shares issued upon refinancing of debt in exchange for debt reduction | 7,095,877 | ||||||
Number of shares issued upon refinancing of debt in exchange for debt reduction before reverse stock split | 99,342,271 | ||||||
Number of shares issued for one share under reverse stock split | 0.0714 | 0.0714 | |||||
Percentage of shares issued to lender to outstanding stock | 47.50% | ||||||
Number of directors who elected to receive their compensation in shares | director | 0 | 0 | |||||
Common stock, shares outstanding before reverse stock split | 213,324,455 | (213,324,455) | |||||
Common stock, shares outstanding | 15,237,456 | 15,373,194 | 15,237,456 | ||||
Minimum proceeds from offerings of common stock as condition to pay cash dividends | $ | $ 50,000 | ||||||
Restricted stock | |||||||
Stock Based Compensation | |||||||
Shares issued and outstanding | 434,512 | 298,774 | |||||
Executive officers | Restricted stock | |||||||
Stock Based Compensation | |||||||
Shares granted | 298,774 | ||||||
Shares granted before reverse stock split | 4,182,832 | ||||||
Vesting on December 31, 2019 | Executive officers | Restricted stock | |||||||
Stock Based Compensation | |||||||
Vesting percentage | 50.00% | ||||||
Vesting period | 15 months 15 days | ||||||
Vesting on December 31, 2021 | Executive officers | Restricted stock | |||||||
Stock Based Compensation | |||||||
Vesting percentage | 50.00% | ||||||
Vesting period | 39 months 15 days | ||||||
Manager's employees | |||||||
Stock Based Compensation | |||||||
Contractual obligation for any stock to be granted | $ | $ 0 | ||||||
Stock compensation (in shares) | 0 | ||||||
Manager's employees | Restricted stock | |||||||
Stock Based Compensation | |||||||
Shares granted | 137,944 | ||||||
Shares issued and outstanding | 135,738 | ||||||
Forfeiture of shares | 2,206 | ||||||
Manager's employees | Vesting on December 31, 2019 | Restricted stock | |||||||
Stock Based Compensation | |||||||
Vesting percentage | 50.00% | ||||||
Vesting period | 7 months 20 days | ||||||
Manager's employees | Vesting on December 31, 2021 | Restricted stock | |||||||
Stock Based Compensation | |||||||
Vesting percentage | 50.00% | ||||||
Vesting period | 31 months 20 days |
Lease Arrangements (Details)
Lease Arrangements (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Future minimum revenue expected to be earned | |
Remainder of 2019 | $ 184,430 |
2020 | 362,091 |
2021 | 339,528 |
2022 | 268,529 |
2023 | 182,786 |
2024 and thereafter | 119,284 |
Total future rentals | $ 1,456,648 |
Term of periodic drydocking and special survey maintenance per vessel | 2 years 6 months |
Term of periodic drydocking and special survey maintenance per vessel for vessels less than 15 years old | 5 years |
Minimum | |
Future minimum revenue expected to be earned | |
Period of drydocking and special survey maintenance carried out on vessels | 10 days |
Maximum | |
Future minimum revenue expected to be earned | |
Age of vessels for which drydocking and special survey maintenance is carried out every 5 years | 15 years |
Period of drydocking and special survey maintenance carried out on vessels | 15 days |
Earnings per Share (Details)
Earnings per Share (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Numerator: | ||||||
Net Income | $ 30,138 | $ 33,443 | $ 5,838 | $ 14,992 | $ 63,581 | $ 20,830 |
Denominator: | ||||||
Basic weighted average common shares outstanding | 14,939,000 | 7,843,000 | 14,939,000 | 7,843,000 | ||
Effect of dilutive securities: | ||||||
Share based compensation | 375,000 | 337,000 | ||||
Diluted weighted average common shares outstanding | 15,314,000 | 7,843,000 | 15,276,000 | 7,843,000 | ||
Warrants to purchase shares of Company's common stock expired in January 2019, excluded from the diluted earnings/(loss) per share due to antidilutive | 15,000,000 | 15,000,000 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Related Party Transactions | |||
Advances on account of the vessels' operating expenses | $ 20,084 | $ 17,970 | |
Due to executive officers shown under accounts payable | 600 | 600 | |
Manager | |||
Related Party Transactions | |||
Management fees incurred shown under General and administrative expenses | 8,300 | $ 8,300 | |
Management commissions incurred shown under Voyage expenses | 2,700 | $ 2,500 | |
Advances on account of the vessels' operating expenses | $ 20,100 | $ 18,000 |