Good day and welcome to the Danaos Corporation Conference Call to discuss the Financial Results for the Three Months ended September 30th, 2024. As a reminder, today's call is being recorded. Hosting the call today is Dr. John Coustas, Chief Executive Officer of Danaos Corporation; and Mr. Evangelos Chatzis, Chief Financial Officer of Danaos Corporation. Dr. Coustas and Mr. Chatzis will be making some introductory comments and then we will open the call to a question-and-answer session. You may begin.

Thank you, operator, and good morning to everyone. Thank you for joining today's call. Before we begin, I quickly want to remind everyone that management's remarks this morning may contain certain forward-looking statements and that actual results could differ materially from those projected today. These forward-looking statements are made as of today and we undertake no obligation to update them. Factors that might affect future results are discussed in our filings with the SEC and we encourage you to review the detailed Safe Harbor and risk factor disclosures. Please also note that where we feel appropriate, we will continue to refer to non-GAAP financial measures, such as EBITDA, adjusted EBITDA, adjusted net income, time charter equivalent revenues, and time charter equivalent dollars per day to evaluate our business. Reconciliations of non-GAAP financial measures to GAAP financial measures are included in our earnings release and the accompanying materials. Now, let me turn the call over to Dr. John Coustas, who will provide a broader overview of the quarter.

Thank you, Evangelos. Good morning and thank you all for joining today's call to discuss our results for the third quarter of 2024. The container market remained very strong in the third quarter of 2024, allowing us to add over $300 million to our contracted charter backlog, which presently stands at $3.3 billion. Importantly, all 14 of our newbuildings on order are fixed for five years, except for two that are fixed for two years. We have excellent earnings visibility as we have covered 100% of our container vessel fleet operating days for 2024, 94% for 2025, and 73% for 2026. The dry bulk market has been uncharacteristically soft lately, which can be attributed to the disruption of seasonal patterns throughout the year as well as a decrease in Chinese steel production. Our dry bulk fleet performed reasonably well during the quarter and we're expecting freight rates to gradually improve as we move into 2025. Due to the certainty provided by the charter backlog in our Container segment, Danaos is insulated from the unstable and unpredictable nature of the current global backdrop. The recent U.S. presidential election has introduced new uncertainty about future policymaking and its effect in the shipping market. Most notably, President Trump has openly declared his intention to implement or increase trade tariffs that have the potential to decrease container movements or at least reshuffle trade lanes. Additionally, it's likely that energy transition initiatives will take place at a slower rate and we don't know to what extent existing IMO initiatives will be supported by the new administration. Danaos remains in a fortunate and enviable position. In addition to our charter coverage, our balance sheet is a significant strength. I'm proud of the efforts we have undertaken, efforts that have been acknowledged by Moody's, who upgraded Danaos to Ba1. Together with the S&P credit rating at BB+, Danaos now holds the highest grade assigned to a pure-play shipping company. Our creditworthiness will allow us to explore fully the U.S. bond market, creating the opportunity to raise competitively priced capital to continue to pursue growth opportunities. Our continued strong financial performance and accompanying strengthening of our balance sheet has enabled us to increase our quarterly dividend to $0.85 a share, in line with the commitment we have made to our shareholders. We're also continuing to return value through our share buyback program. We have now cumulatively bought back stock worth $123 million and have $77 million remaining under our authorized share repurchase program. We are continuing our efforts to increase the value of the company, while remaining vigilant about geopolitical risks to ensure the long-term prosperity of Danaos for the benefit of our shareholders. With that, I'll hand the call back over to Evangelos, who will take you through the financials for the quarter.

Thank you, John, and again, good morning to everyone. I will briefly review the results for the quarter and then open the call to Q&A. We are reporting adjusted EPS for this quarter of $6.5 per share or adjusted net income of $126.8 million, and that compares to adjusted EPS of $7.26 per share or adjusted net income of $143 million for the third quarter of 2023. The decrease of $16.2 million in adjusted net income between the two quarters is a result of a $31.1 million increase in total operating expenses, mainly due to the recognition during the current quarter of voyage costs related to voyage charters of our dry bulk capesize fleet and the $3.3 million increase in net finance costs, and those were partially offset by a $17 million increase in net operating revenues and the $1.2 million improvement in income from investments. Vessel OpEx increased by $10.4 million to $49.9 million in the current quarter from $39.5 million in the corresponding third quarter of 2023 as a result of the increase in the average number of vessels in our fleet, while at the same time, our daily OpEx cost increased to $6,860 per day for this quarter compared to $6,500 per day for the third quarter of 2023. Our operating costs continue to remain among the most competitive in the industry. G&A expenses increased by $3.9 million to $11 million in the current quarter compared to $7.1 million in the third quarter of 2023, mainly due to an increase in stock-based non-cash costs. Interest expense, excluding amortization of finance costs, increased by $3.6 million to $7.4 million in the current quarter compared to $3.8 million in the corresponding third quarter of 2023. The increase in interest expense is a combined result of a $4.2 million increase in interest expense due to an increase in our average indebtedness by more than $200 million between the two periods, partially offset by a reduction in the cost of debt service by approximately 26 basis points, mainly as a result of a decrease in our financing margin costs between the two periods. This was offset by a $0.6 million decrease in interest expense due to increased capitalized interest between the two periods on vessels that are under construction. At the same time, interest income for the quarter came in at $3.5 million. Adjusted EBITDA increased slightly by 0.5% or approximately $1 million to $178.9 million in the current quarter from $178 million in the corresponding third quarter of 2023 for reasons that have already been outlined earlier on this call. We also encourage you to review our updated investor presentation that is posted on our website as well as subsequent event disclosures. Some of the highlights are that since the date of our prior earnings release, as was earlier mentioned by John, we have added $308 million to our contracted revenue backlog. And as a result, our contracted revenue backlog remains strong and has now increased to $3.3 billion with a 3.4-year average charter duration. Our investor presentation has analytical disclosure on our contracted charter book. Additionally, as of September 30, 2024, our net debt stood at $305 million. And in the current interest rate environment, this position shields us from high interest costs. Additionally, the company's net debt-to-EBITDA ratio stood at 0.4 times, while 53 out of our 82 vessels are currently unencumbered and debt-free. Finally, at the end of the third quarter, cash was at $384 million, while total liquidity, including availability under our revolving credit facility and marketable securities stood at $785 million, giving us ample flexibility to pursue accretive capital deployment opportunities. With that, I would like to thank you for listening to this first part of our call. Operator, we are now ready to open the call to Q&A.

We will now begin the question-and-answer session. The first question comes from Omar Nokta with Jefferies. Please go ahead.

Thank you. Hi, John, Evangelos. Good afternoon.

Hi Omar.

Yes, hi. I have a couple of questions. As you highlighted in the release and presentation, you have taken advantage of the strong container market to secure long-term charters. You've ordered new ships in the past, which are all contracted now. Last quarter, you mentioned that you were stepping back from the newbuilding market, but there seems to be ongoing interest from liners for newbuildings. I wanted to know your thoughts on Danaos' position in the newbuilding market. Are you still on the sidelines, or do you see a chance to return to ordering new ships?

Things are progressing well, and we are addressing issues as they arise. We have significantly increased our contracted revenue since the release. It's not that we lack faith in the market's stability; rather, we want to understand the current landscape better. A major concern is the future of environmental regulations regarding newbuildings. The new U.S. administration is likely to diverge from the previous one, and it's uncertain how this will affect ongoing discussions related to the carbon tax or levy by the IMO. The implementation of these regulations will greatly impact the decarbonization trajectory. Meanwhile, newbuilding prices are rising, with most of our ordered ships seeing price increases of 15% to 20%. We plan to be cautious until the market stabilizes. We don’t place orders solely based on back-to-back charters, as those typically yield only mid-single-digit equity returns, which we find unacceptable. When we take on the risk ourselves, asset pricing becomes critical. This is why we are being patient; if prices decrease, we will be ready to seize the opportunity.

Okay, thanks John, that's fairly clear. And just to summarize that simply, given the uncertainty on the new administration, what that means for environmental shifts going forward, that uncertainty plus the fact that newbuilding prices are high and you don't know where this container market is going, you're content with how things are and you'd rather when you order, do it opportunistically to give yourself a better ROE. And given that, it makes sense to just wait.

Yes, exactly.

Okay. And then just a second question. I know we've talked about this before on separate calls. Just in terms of the dry bulk investment, you bought into dry bulk at the market lows, I think, starting last year. It strengthened a bit, but it's come off here over the past few months, although I guess you could say recently, there's another bounce. But in general, it feels like the sector has maybe softened a bit relative to what we were seeing previously. How are you thinking about dry bulk in terms of where we are sort of fundamentally? And where do you see Danaos going with this segment?

As I said, we've built a fleet of 10 ships. And as the capesize is a new segment for us, we are currently in an experience-building phase. We are operating the ships. We want to see exactly where do we see benefits, which are the qualities of the ships that make sense and they are cost-effective. We will follow the market closely and this market is much more liquid compared to the container market. There are opportunities out. And if we see really that there is an opportunity, we will jump on it. On the other hand, as you said, as the dry bulk market is mainly China-driven, the situation in China, also, again, with the new U.S. administration is also relatively unclear. And this will affect quite a lot the dry bulk movement, especially on capesizes where, I mean, iron ore makes a very big proportion.

Right. Yes. Thank you. And then just sorry to follow-up just and press maybe just one bit further on just the comment you made on if you see an opportunity, you would jump on it. Is that in relation to opportunity to acquire assets or to sell? Or are you talking, say, both?

No, to acquire more assets or whatever.

Okay. All right. Thanks. That’s it for me.

Great. Thank you, Omar.

It appears we have no further questions at this time. I would like to turn the call back over to Dr. Coustas for any further comments or closing remarks.

Thank you all for joining this conference call and your continued interest in our story. Look forward to hosting you on our next earnings call.

Thank you. This concludes today's teleconference. We would like to thank everyone for their participation. Have a wonderful afternoon.