Dear Fellow Shareholders,
This past year has reaffirmed our view that the unexpected can occur and that the unexpected often creates disruption
that benefits shipping companies. Indeed, the current geopolitical backdrop has created a potent mix for all sectors
of our industry. In addition to the continuing war in Ukraine, the conflict in the Middle East and the impact of
Houthi rebels on Suez Canal transits have dramatically altered trade routes, resulting in longer sailing distances.
Drought conditions have also caused restrictions in Panama Canal transit, exacerbating the situation.
Entering 2023, the consensus view was that the container sector would soften significantly in early 2024 as
newbuilding vessels ordered during the peak of the cycle were delivered. In reality, the aforementioned disruptions
as well as sailing speed reductions of the fleet combined have not only stabilized, but also increased both box and
charter rates.
Danaos has been able to capitalize on underlying market strength and has secured charters for most of our vessels
coming off charter in 2024 as well as our eight newbuilds delivering in 2024 and early 2025. We have also placed an
additional order for two 8,200 TEU methanol-ready container vessels and now have a total of 14 newbuildings with an
aggregate TEU of approximately 108,000 TEU. In addition to adding modern, methanol-ready vessels to our fleet, we
have begun a very significant plan to retrofit our existing fleet to enhance its energy efficiency, a plan which
will ensure the longevity of our assets.
In 2023, Danaos saw opportunity in the dry bulk shipping market, a market to where we trace our roots. We invested in
the common shares of Eagle Bulk Shipping, Inc., which subsequently merged with Star Bulk Carriers Corp. (Nasdaq:
SBLK), resulting in a return of nearly 50 percent in less than a year. We also purchased 10 Capesize vessels, which
have also already seen significant appreciation in value from their purchase prices. We believe that the dry bulk
market offers an opportunity to diversify our income and we will continue to look for ways to increase our exposure
to this market.
Our strong performance over the last couple of years has enabled us to reduce our net debt position to nearly zero,
insulating us from high interest rate environment and giving us flexibility and firepower to pursue opportunities.
Despite the uncertainties in today’s world, we believe we believe our actions have placed Danaos in an enviable
position to ensure the stability and growth of the company over the long term. Thank you for your continuing
support.
Respectfully,
Dr. John Coustas
President & CEO