“The dramatic turnaround and strength of the market which we experienced in the beginning of the year continues unabated, if not stronger. The continuation of the pandemic and the ensuing slowdown in the terminal operations have exacerbated demand and the liner sector is at the limit of its capacity. The blockage of the Suez Canal further contributed to the disruption in the supply chain and conditions will likely not normalize before the end of the year, possibly after the peak season.

Liner companies are reporting record profits and, more importantly, are signing multi-year contracts at significantly higher levels which will keep their profitability at elevated levels. On the non-operating owners front, charter rates have skyrocketed to levels not seen for at least 10 years and what is more important duration has been significantly increased so that vessels over 4,000 TEU can secure 4+ years employment at very healthy levels.

This euphoria due to the sharp increase in rates and confidence that the market will remain strong has led to a dramatic increase in newbuilding ordering. As a result, the orderbook now stands at 17% of the existing fleet which is higher compared to the 9% nadir at the end of 2020 but still much lower than the 50% it reached in 2008.

Fortunately, the lack of shipyard capacity and the hesitance of many market participants to order vessels with conventional fuel propulsion both are inhibiting factors for new orders and are keeping a lid on excessive ordering. In any event, the recently ordered vessels will not deliver until at least 2023, and the next two years should be lean in terms of fleet supply growth. We believe that the expected strong demand growth post pandemic will comfortably absorb the existing orderbook.

As far as Danaos is concerned we are currently in the best ever position and reaping the benefits of the current market environment. On April 12th we completed our refinancing on very competitive terms and also positioned the company successfully in the US bond market, giving us access to a very significant pool of capital. The amortization profile of our debt is resulting in significant free cash flow for growth opportunities.

The stellar performance of the liner sector had a number of significant consequences for us. First, our shareholding in ZIM is today valued at around $400 million. Secondly, the dramatic cash flow generation of Zim and HMM induced them to redeem early the bonds which we were holding so we will have a $75 million cash injection in the second quarter of 2021. Thirdly, the liner sector performance also eliminates counterparty risk for the foreseeable future.

On the chartering front every fixture we concluded was done at a new record level. These fixtures are beginning to take effect and we expect to see improved metrics for every single quarter for this year.

Our strong financial standing and optimistic view for the future has led the Board to decide to reinstate a fixed quarterly dividend of $0.50 per share. Danaos has been repositioned as a growth company and has handsomely rewarded its shareholders through a dramatic share appreciation of greater than 1,000% since our November 2019 equity offering. We believe that our new fixed dividend will both expand our shareholder base to a new group of yield driven institutional investors and also enhance liquidity of the stock.

All the right steps that the company has undertaken in the last couple of years have been greatly appreciated by the market and we will continue along the same path in the future.”