Danaos Corporation

Good day and welcome to the Denao's Corporation conference call to discuss the financial results for the three months ended June 30th, 2023. As a reminder, today's call is being recorded. Hosting the call today is Dr. John Kustis, Chief Executive Officer of Denao's Corporation and Mr. Yvon Galas-Hattis, Chief Financial Officer of Denao's Corporation. Dr. Katous and Mr. Hatice will be making some introductory comments, and then we'll open the call for questions and answers. Please go ahead.

Thank you, operator, and good morning to everyone, and thank you for joining us today. 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 these 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, and adjusted net income to evaluate our business. Reconciliations of non-GAAP financial measures to GAAP financial measures are included in our earnings release and accompanying materials. With that, let me now turn the call over to Dr. John Koustas, who will provide the broad overview of the quarter. John?

Thank you, Evangelos. Good morning, and thank you all for joining today's call to discuss our results for the second quarter of 2023. The world economy stagnated in the second quarter of 2023, resulting in a gradual easing of the container market. Danao's active strategy in the current market condition is made possible by the prudent approach we have taken to manage our balance sheet to conservative levels, as well as our successful chartering strategy. The latter is reflected in our operating revenues of 241 million, which is near to previous records despite a charter market drop that is more than 50% lower than a year ago. We continue to be active in the charter market, highlighting the resilience of our business model, and secure nearly half a billion in new charter contracts during the quarter. Our total charter backlog increased to 2.5 billion as of the end of the quarter. And contracted charter coverage currently stands at 99% for 2023 and 86% for 2024. In the second quarter of 2023, Danaos received the gold first place awards in the governance and environment categories in the inaugural ESG Shipping Awards. These accolades, which we're proud of, acknowledge the company's exemplary efforts in promoting sustainable practices social responsibility and strong governance and reaffirm our position as a leader in responsible maritime operations. The timing of the awards is notable as the IMO recently reiterated and strengthened its commitment to decarbonize shipping by targeting net zero by around 2050. Danaos continues to advance its decarbonization strategy in multiple ways. We are constantly optimizing and retrofitting our existing fleet and have committed to upgrade around 20 vessels with new propellers, fuel-saving appendages, and low-friction paints. We have also expanded our new building program with the order of four additional new building vessels. These vessels, two of which are 6,000 TEU and two of which are 8,200 TEU, will be delivered methanol-ready, ensuring the longevity of our investments. In total, we have 10 vessels with a total capacity of approximately 75,000 TEU on order. All of these will be able to utilize alternative fuels, and importantly, six of these vessels are already chartered for multi-year periods beginning on their delivery dates in 2024. We also deployed capital opportunistically after identifying weakness in the dry bulk market, a market we are very familiar with. We believe the long-term fundamentals in the dry bulk market are very positive. In particular, the order book is at historically low levels, and fleet supply growth is projected to decline significantly over the next several years against the backdrop of rebounding demand. Shorter market sentiment is not as strong, and we were able to make investments at attractive prices. As has been previously reported, the announced suppliers a significant stake in Igloo Bulk Shipping, a New York Stock Exchange listed dry bulk company. Additionally, we acquired five cape-sized bulkers in the second-hand market. With respect to Igloo, we were able to purchase shares in a company we believed had best-in-class corporate governance practices at a significant discount to our perception of the company's net asset value. Shortly following our investment, The board of EGLE unilaterally implemented a poison pill and repurchased Oak Tree Capital's 28% stake in the company at nearly a 35% premium to EGLE's 45-day average share prices and a 32% premium to our cost basis. These transactions, which were done by EGLE's board, fundamentally alter our view of EGLE's corporate governance. We are concerned with these developments and are seeking clarification from the Board of Directors of Eagle. As Eagle Park's current larger shareholder, we have a strong vested interest in seeing the company enhance long-term shareholder value and believe that we have a duty to speak up when we think the board and or management may be acting outside the best interests of all shareholders. Accordingly, we are committed to working constructively with the board to identify balance well-considered and effective methods to enhance shareholder value on behalf of all shareholders. With respect to our interest in the dry bulk market in general, Danao has significant experience in the dry bulk market as an owner and operator. We exited the segment years ago, which was a well-timed decision in his sight, and now we again see opportunity. Given the strength of our balance sheet, we are uniquely positioned deploy capital in various ways to grow our revenue base and earnings. Our fleet of container vessels, which are contracted and multi-year charters, provide strong revenue and cash flow visibility. While we will continue to grow and future-proof our core fleet by adding next-generation vessels to it, our ultimate goal is to generate value for our shareholders, and we will consistently pursue the best opportunities to do so. As I've said before, our healthy balance sheet allows us to opportunistically deploy our capital in various ways. During the quarter, we continued our buyback program and have now spent $65.5 million of our $100 million buyback program to retire more than 1 million shares. Finally, we remain committed to returning capital to shareholders, as evidenced by our 0.75 per share dividend announced this morning. We will continue to implement our strategy to ensure the long-term growth and profitability of the company and are consistently focused on creating value for our shareholders. With that, I'll hand over the call back to Evangelos, who will take you through the financials for the quarter. Evangelos?