World-Class Shipping, Leading-Edge Expertise Corporate Presentation - - PowerPoint PPT Presentation

World-Class Shipping, Leading-Edge Expertise

Corporate Presentation | May 2020

Danaos by the Numbers Disclaimer

This presentation contains certain statements that may be deemed to be “forward-looking statements” within the meaning of the Securities Exchange Act of

• 1934. All statements, other than statements of historical facts, that address activities, events or developments that the Company expects, projects, believes or

anticipates will or may occur in the future, including, without limitation, the outlook for fleet utilization and shipping rates, general industry conditions including bidding activity, future operating results of the Company’s vessels, future operating revenues and cash flows, capital expenditures, vessel market values, asset sales, expansion and growth opportunities, bank borrowings, financing activities and other such matters, are forward-looking statements. Although the Company believes that its expectations stated in this presentation are based on reasonable assumptions, actual results may differ from those projected in the forward-looking statements. Important factors that could cause actual results to differ materially from those discussed in the forward-looking statements include the strength of world economies, general market conditions, including charter rates and vessel values, counterparty performance under existing charters, changes in operating expenses, ability to obtain financing and comply with covenants in financing arrangements, including the terms of its new credit facilities and agreements entered into in connection with the refinancing, the affects of the refinancing transactions and the Company’s ability to achieve the benefits of the refinancing, actions taken by regulatory authorities, potential liability from litigation and international political conditions. Danaos Corporation is listed in the New York Stock Exchange under the ticker symbol “DAC”. Before you invest, you should also read the documents Danaos Corporation has filed with the SEC for more complete information about the company. You may get these documents for free by visiting EDGAR on the SEC Website at www.sec.gov or via www.danaos.com Readers of this presentation should review our Annual Report on Form 20-F filed with the SEC on February 27, 2020, including the section entitled “Key Information – Risk Factors”, and our other filings with the SEC for a discussion of factors and circumstances that could affect our future financial results and

• ur ability to realize the expectations stated herein.

EBITDA, Adjusted EBITDA, Adjusted Net Income and Adjusted EPS may be included in our presentations. EBITDA, Adjusted EBITDA, Adjusted Net Income and Adjusted EPS are presented because they are used by management and certain investors to measure a company’s financial performance and underlying trends as they exclude certain items impacting overall comparability. EBITDA, Adjusted EBITDA, Adjusted Net Income and Adjusted EPS are “non-GAAP financial measures” and should not be considered a substitute for net income, cash flow from operating activities and other operations or cash flow statement data prepared in accordance with accounting principles generally accepted in the United States or as a measure of profitability or liquidity. Reconciliations to GAAP measures are included in the Appendix to this presentation. Certain shipping industry information, statistics and charts contained herein have been derived from industry sources. You are hereby advised that such information, statistics and charts have not been prepared specifically for inclusion in this presentation and the Company has not undertaken any independent investigation to confirm the accuracy or completeness of such information. 2

k

Business Overview

3

• One of the largest publicly-listed owners of modern containerships with

long track record in the shipping market

• One of the most efficient operators in the industry with highly

competitive breakeven levels

• Management is the largest shareholder (~37.3%)(1) and is aligned with

public shareholders

✓ A LEADING CONTAINERSHIP OWNER AND OPERATOR

• Adjusted Net Debt / EBITDA ratio of 4.8x and consistent reduction in

leverage through amortization schedule

• Going forward financial covenants in line with conservative operating

expectations

• Significant financial commitment by founder and largest shareholder

✓ HEALTHY CAPITAL STRUCTURE LIMIT RE-CHARTERING RISK AND POTENTIAL FOR UPSIDE ✓

• Charter backlog of $1.3 billion through 2028 with world’s leading liner

companies provides good cash flow visibility

• Large, modern 13,100 TEU vessels are all on long-term charters through

2024

• Strong contract coverage of 90% for 2020 limits downside risk and

provides potential for upside from 2021 onwards

(1) Inclusive of extended Coustas family interest. .

COVID-19 MARKET UPDATE

• The charter market has softened significantly due

to the COVID-19 pandemic, and rates have declined by 25% - 40%, depending on vessel size

• Liner companies have addressed the drop in

volumes brought on by the pandemic by cancelling sailings and idling capacity

• Despite the drop in volumes, liner companies have

significantly alleviated pressure on their cash flows through prudent capacity management which has led to stable freight rates and have also taken the benefit of reduced bunker prices and falling interest rates

• Several initiatives have been undertaken by

governments in Europe and Asia to support the liner industry during this difficult period, which is a very encouraging sign

• Historically-low orderbook for containerships,

provides potential for a swift recovery when the situation normalizes

Danaos by the Numbers

$1.3bn

Contracted cash flow through 2028

4.8x

Net debt to LTM Adjusted EBITDA

$305mn

LTM Adjusted EBITDA 1Q 2020

37.3%

Ownership through founder / management

$2.0bn

Enterprise value

2.4x

Reduction in leverage over the last two years

4

970 487 377 242 207 183 465 459 440 343 253 253 248 226 223 204 200 195

Seaspan Costamare Danaos Global Ship Lease Navios MPC Group Offen, Claus Peter Shoei Kisen Zodiac Maritime BoCom Leasing Fredriksen Group Eastern Pacific Shpg Peter Dohle / Hammonia Zeaborn Schulte Group Nissen Kaiun Minsheng Financial Leasing Norddeutsche R.H. Schuldt

40+ Year Legacy of Leadership in Container Shipping

Source: Clarksons Research. (1) Includes Gemini Shipholdings Vessels (TEU), a joint venture in which Danaos owns a 49% stake: Suez Canal (5,610), Genoa (5,544), Lodestar (6,422), Leo C (6,422) and Bellta (8,533). (2) Global Ship Lease includes Pro Forma TEU for Poseidon / Technomar Acquisition which closed November 15, 2018

Publicly Traded Pure-Play Operators Financial / Independent Owners

Market Share1, 2 Among Top Public Containership Owners Globally

By TEU, thousands

5

1972

Founded by Dimitris Coustas

1987

• Dr. John Coustas steps into

Chief Executive role

2005

Incorporation in Marshall Islands

2006

NYSE IPO Raised $200mm

2018 to present

Refinancing, share

• ffering and growth

2010

$200mm equity raise

38% 9% 27% 24% 2% 1% 1%

Diverse, High-Quality Fleet 2x

5,500 TEU

2x

6,500 TEU

1x

8,500 TEU

9x

6,400 – 6,500 TEU Average Age: 11.7 years Remaining Charter Term: 3.5 years

10x

4,300 – 5,500 TEU Average Age: 12.5 years Remaining Charter Term: 0.5 years

8x

3,500 TEU Average Age: 12.2 years Remaining Charter Term: 0.4 years

11x

2,200 – 2,600 TEU Average Age: 21.7 years Remaining Charter Term: 0.3 years

Note: Figures as of March 31st 2020. Please refer to appendix for additional detail. (1) Excludes Gemini Shipholdings Vessels (TEU), a joint venture in which Danaos owns a 49% stake: Suez Canal (5,610), Genoa (5,544), Lodestar (6,422), Leo C (6,422) and Bellta (8,533).

Fleet Overview(1)

5x

13,100 TEU Average Age: 7.9 years Remaining Charter Term: 4.1 years

9x

8,500 TEU Average Age: 11.1 years Remaining Charter Term: 3.2 years

5x

9,600 - 10,100 TEU Average Age: 10.7 years Remaining Charter Term: 2.4 years

Gemini Vessels

Contracted Revenue Contribution(1)

6

Danaos by the Numbers Balanced Counterparty Concentration

Note: Distributed by TEU.

30% 17% 15% 9% 8% 7% 14%

(20 years) (25 years) (37 years) (15 years) (34 years) (40+ years)

Overview of Customer Base

• Long history chartering to most major global

liner companies

• Engaged with container alliances on

deployments across major and minor global routes

• Have collaborated with customers in ordering

46 newbuildings in excess of 300,000 TEU over

• ur history at a cost in excess of $4 billion

Close Alignment Working with Customers

• Consistently developing operating expertise to
• btain and retain customers
• Delivering on-time new ships to customers’

specifications

• Prioritizing reputation, customer service and

safety

• Maintain a strategic focus on regular

engagement with customers, particularly in regards to new customer needs and technological advancements Other Length of Customer Relationships Noted in Italics

7

Strong Charter Coverage through 2024

Note: Charter Revenue assumes Gross Daily Charter Rate. Contracted Revenue and Charter Expiration Schedule exclude Gemini Shipholdings. (1) Assumes non-contracted vessels employed at current contracted charter rates.

Shorter charter durations limited to vessels in more liquid chartering markets Contracted Revenue by Year

mm $ by Asset Class

Revenue-Weighted Charter Coverage(1)

8

90% 75% 59% 41% 5% 2020 2021 2022 2023 2024+ $426 $366 $281 $189 $119 2020 2021 2022 2023 2024+ 13,000 9,500-10,000 8,500 6,400-6,500 4,300-5,500 3,500 2,200-2,600

$305 $182 $51 ($79) ($3) ($23) ($6) ($12) ($131)

LTM Q1 2020 EBITDA Net Cash Interest JV Earnings Revenue Recognition (Non-Cash) Other Dry Docking Operating Cash Flow Debt Amortization LTM Q1 2020 FCF

Good Free Cash Flow Visibility

Source: Company filings as of 03/31/2020. Note: Recurring Free Cash Flow calculated excluding non-recurring items such as Vessels Addition Capital Expenditures and Financing Costs. (1) Non-GAAP measure. See appendix for definitions and reconciliations to the nearest GAAP measure.

Illustrative Walk to LTM Q1 2020 Free Cash Flow(1)

LTM Q1 2020 FCF excludes CapEx and one-time / unusual items

(1) (1)

Drivers of LTM Q1 2020 FCF ✓ Lower interest rates ✓ Contractual charter escalations ✓ Vessel acquisitions Uses of FCF ✓ Further debt amortization ✓ Return of capital to shareholders ✓ Vessel acquisitions 9

Focused on Maintaining Conservative Capital Structure

Net Adjusted Debt and Adjusted EBITDA Multiple(1) Capitalization

3,165 3,042 2,892 2,703 2,454 2,274 1,615 1,443 1,452

7.3x 7.0x 7.2x 6.5x 7.0x 7.3x 5.1x 4.6x 4.8x

500 1,000 1,500 2,000 2,500 3,000 $3,500

2012 2013 2014 2015 2016 2017 2018 2019 LTM 1Q 2020

(1) Based on total adjusted debt, net of deferred finance costs and fair value adjustments, as of March 31st 2020. (2) Non-GAAP measure. See appendix for definitions and reconciliations to the nearest GAAP measure.

Net Adjusted Debt

3/31/2020 $ in millions Cash $97 Bank Debt: 1,392 Long-term Leaseback Obligation 134 Exit Fee 22 Deferred Finance Costs (31) Debt Fair Value Adjustment (18) Total Debt $1,500 adjusted for Deferred Finance Costs 31 Debt Fair Value Adjustment 18 Total Debt $1,549 Net Debt 1,452 Book Value of Equity 904 Total Capitalization $2,453 Credit Statistics: LTM Adj. EBITDA(2) $305 Debt / LTM Adj. EBITDA(2) 5.1x Net Debt / LTM Adj. EBITDA(2) 4.8x Net Debt / Book Equity(2) 1.6x 10

Experienced Senior Management

• Dr. John Coustas, President & CEO

Dimitris Vastarouchas, Technical Director & Deputy COO

• CEO since 1987
• Over 30 years of experience in the

shipping industry

• Vice Chairman of the board of directors of

The Swedish Club; member of the board

• f directors of the Union of Greek

Shipowners and the DNV Council

Evangelos Chatzis, Chief Financial Officer

• Joined Danaos in 2005
• Over 25 years of experience in corporate

finance and the shipping industry

• Formerly CFO of Globe Group of

Companies

• Danaos Technical Manager since 2005
• Has over 20 years of experience in the

shipping industry

• Formerly New Buildings Projects and Site

Manager supervising the construction of 4,250, 5,500 and 8,500 TEU containerships

Iraklis Prokopakis, Senior Vice President, Treasurer & COO

• Joined Danaos in 1998
• Over 40 years of experience in the shipping

industry

• Member of the Board of the Hellenic Chamber
• f Shipping and the Owners’ Committee of the

Korean Register of Shipping 11

Governance Independent Board Clear reporting of transactions with Danaos Shipping (Manager) − Amounts approved by independent board members Arms length cost arrangements, which are amongst lowest in industry and fixed through 2024

✓ ✓ ✓

Social Code of ethics and compliance policies published for Directors / Officers Accredited by Global Reporting Initiative (GRI) for sustainability best practices and socially responsible management

✓ ✓

Environmental Advanced solutions to reduce emissions through fuel efficiency optimization Scrubber installation on select vessels Low-sulfur fuel oil to be procured Ballast water system compliance Partnership with founders

• f Poseidon Principles

✓ ✓ ✓ ✓ ✓

Longstanding Champion of ESG Principles

Danaos Management is keenly focused on maintaining a strong ESG framework for company operations

12

HINDSIGHT:

• ‘Reflect and learn from past data’ through statistical processing and trend analysis
• Detection of hidden correlations among seemingly un-related data

INSIGHT: ‘Interpret data and respond efficiently to the present’

• KPls real-time monitoring (operational efficiency, safety performance, etc.)
• Vessel’s benchmarking against: theoretical curves, specifications, tests and trials, sister and competitor vessel monitoring
• Timely anomaly detection and alerting for abnormal behavior or deviation from predefined thresholds

FORESIGHT: ‘Predict and get ready for the future’ through scenario testing, system risk assessments and observational maintenance As well as Routines System Data monitoring …

• BCS, pMatrix, Power Mgmt, Steam Mgmt, ODA …
• Tanks Mgmt. Bunker Analysis, Bunker Surveys, Bunkering Monitoring ...
• Performance, Propulsion, Emissions ...

Data Analytics/Algorithmic Analysis (Operator-defined) of Fused Data across Monitoring Systems Workflow Management

Operator-defined workflows for timely and effective response to alarm events: what actions must take place, who from the crew should be involved, and what actions must be logged / other systems triggered

Waves Fleet Performance … Riding the Wave of Innovation!

Pioneers in Digitalization

13

Industry Overview

Seaborne Containerized Trade Forecast to Rebound Quickly

Global Seaborne Container Trade

Source: Clarksons Research

15

(15%) (10%) (5%) 0% 5% 10% 15% 50 100 150 200 250

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020f 2021f

TEU mm

World Seaborne Container Trade Y-o-Y Growth

Containership Trade Routes

Source: Clarksons Research (1) Basis trades with Far East & Europe. (2) Basis full year estimate / forecast.

• Units of 15,000+ TEU remain exclusively deployed on the

Far East-Europe trade

• Deployment of boxships sized 12-14,999 TEU continues

to broaden notably onto the Transpacific route and also

• nto some non-mainlane trades
• Boxships sized 6,000-11,999 TEU offer flexible

deployment opportunities, with further reductions in reliance on the mainlanes seen in 2019, although demand can be sensitive to short-term shifts

• Approximately 30% of capacity deployed on intra-regional

trade routes is accounted for by units of 3,000+ TEU; this share has been fairly steady for a number of years now

• Intra-regional routes, and deployment of sub-3,000 TEU

units thereon, appear ‘protected’ against significant vessel upsizing to some degree, by infrastructure, volume and

• ther operational constraints

Mainlane, 30% Non- Mainlane East-West, 11% North- South, 16% Intra- Regional, 43%

201mm TEU

Largest vessels primarily deployed on long trade routes Container Trade by Trade Lane 2019

16

Geographic Deployment Favoring Certain Size Vessels

Largest vessels primarily deployed on long trade routes Capacity Deployment By Route

mm $ by Asset Class

Source: Clarksons Research

0% 20% 40% 60% 80% 100% <3k TEU 3-6k TEU 6-8k TEU 8-12k TEU 12-15k TEU 15k+ TEU Mainlane E-W Non-Mainlane E-W North-South Intra-Regional

17

0.00 0.25 0.50 0.75 1.00 1.25 2020 2021 2022

12,000+ TEU 8,000–11,999 TEU 3,000–7,999 TEU 100–2,999 TEU

10% 14% 1% 11% 0% 5% 10% 15%

Containership Orderbook % Fleet Containership 8,000+ TEU Orderbook % Fleet Containership 3-7,999 TEU Orderbook % Fleet Containership <3,000 TEU Orderbook % Fleet

Supply Growth Primary in Largest Vessel Segments

Orderbook is concentrated in 8,000+ TEU vessels where Danaos has the greatest charter coverage Containership Orderbook, as % of Fleet by Segment

TEU, mm

Source: Clarksons Research

Containership Orderbook, By Scheduled Delivery Year

TEU, mm

18

Charter Rates Negatively Impacted by COVID-19

4,400 TEU gls ‘Old Panamax’ Containership 6-12 Month TC Rate

$/day, thousands

9,000 TEU gls Containership 3-yr TC Rate1

$/day, thousands

Source: Clarksons Research Note: Limited activity on longer TCs with wide spread on rate ideas. (1) Based on ‘Neo-Panamax’ ships.

6,800 TEU Containership 3-yr TC Rate

$/day, thousands

2,500 TEU grd Containership 6-12 month TC Rate

$/day, thousands

19 10 20 30 40 50 Apr-13 Apr-14 Apr-15 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20 5 10 15 20 25 30 Apr-13 Apr-14 Apr-15 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20 10 20 30 40 Apr-13 Apr-14 Apr-15 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20 10 20 30 40 Apr-13 Apr-14 Apr-15 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20

Asset Values Steady, but Few Recent Transactions

4,500 TEU ‘Old Panamax’ Containership 10 Year Old Secondhand Price

mm $

8,800 TEU Containership 5 Year Old Secondhand Price

mm $

Source: Clarksons Research Note: Limited activity on longer TCs with wide spread on rate ideas. (1) Based on ‘Neo-Panamax’ ships.

6,600 TEU Containership 5 Year Old Secondhand Price

mm $

2,500 TEU grd Containership 10-Year-Old Secondhand Price

mm $

20 20 40 60 80 100 120 140 Apr-13 Apr-14 Apr-15 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20 20 40 60 80 100 120 Apr-13 Apr-14 Apr-15 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20 10 20 30 40 50 Apr-13 Apr-14 Apr-15 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20 10 20 Apr-13 Apr-14 Apr-15 Apr-16 Apr-17 Apr-18 Apr-19 Apr-20

Financial Overview

Historical Financials

Net Leverage Adjusted Net Income Operating Revenues

mm $

Adjusted EBITDA

mm $

$589 $588 $552 $568 $498 $452 $459 $447 $441

2012 2013 2014 2015 2016 2017 2018 2019 LTM

$432 $434 $404 $418 $351 $310 $318 $311 $305

2012 2013 2014 2015 2016 2017 2018 2019 LTM

7.3x 7.0x 7.2x 6.5x 7.0x 7.3x 5.1x 4.6x 4.8x

2012 2013 2014 2015 2016 2017 2018 2019 Q1'20

Source: Company filings. Note: Adjusted Net Income reflects add-backs of various income statement items, most notably impairment charges, amortization of deferred financing costs and other one-off extraordinary items. Note: LTM reflects twelve months period ending March 31, 2020

$60 $54 $60 $159 $141 $115 $131 $149 $143

2012 2013 2014 2015 2016 2017 2018 2019 LTM 22

Summary Results

First Quarter 2020 Earnings

Three Months ended March 31 2020 2019 % qoq Operating Revenue $106,196 $112,891

• 5.9%

Adjusted EBITDA1 $71,918 $77,538

• 7.2%

Adjusted Net Income $33,281 $38,569

• 13.7%

Adjusted Earnings per Share, diluted2 $1.34 $2.53

• 47.0%

Summary of Results

thousands $, expect per share figures

First Quarter Highlights

• Adjusted fleet utilization, excluding off-hire days due to Covid-19 shipyard delays, was 95% for the three months ended

March 31, 2020

• Adjusted net income marginally improved when compared Q1 2019 when excluding $6.1 non-recurring decrease in
• perating revenues due to scrubber installation and Covid-19 off-hire delays
• Charter contract coverage of 85% in terms of operating revenues and 66% in terms of operating days over the next 12

months

(1) Adjusted EBITDA represents net income before interest income and expense, depreciation, amortization of deferred drydocking & special survey costs and deferred finance costs, amortization of deferred realized losses on interest rate swaps, loss on sale of securities, gain on debt extinguishment, stock based compensation and refinancing professional fees. (2) Based on weighted average diluted shares outstanding.

23

Last Twelve Months $440,549 $304,945 $143,387 $7.71

Charter-Adjusted Total Asset Value Net Debt Net Working Capital & Other Net Asset Value

Charter Adjusted Net Asset Value

Note: Asset value does not include vessels acquired after March 31, 2020. Refer to appendix for additional details regarding calculation of Net Asset Value. (1) Net debt includes (1) $1,452.0 million of long-term debt, including current portion, which adds back deferred finance costs of $31.0 million and debt fair value adjustment of $18.5 million, and (2) $134.3 million of long-term leaseback obligations, including current portion, less (3) cash and cash equivalents of $97.0 million. Please refer to Appendix. Does not include accumulated accrued interest of $179.8 million as of March 31, 2020. (2) Includes carrying value of investments in Gemini JV of $10.5 million and ZIM and HMM notes of $24.3 million, as well as net working capital and other assets and liabilities. Excludes assets and liabilities relating to accruals for certain non-cash items relating to straight-line revenue recognition, unearned revenue with respect to ZIM and HMM notes and deferred Handling Fees. Please refer to Appendix for further details. (3) Based on 24.789 mm shares outstanding as of March 31, 2020.

(in US$ millions)

(2) (1)

NAV / Share: $19.6(3)

As of March 31, 2020

• As calculated in accordance with the financial covenants contained in the Company’s credit facilities as of March 31, 2020, market value of the

Company’s existing fleet of 56 containerships on a charter-inclusive basis was approximately $1.88 billion. Including $11.5 million carrying value in advances for installation of vessel scrubbers, which are not yet fully installed, this charter-inclusive value increases to $1.9 billion

−

Broker appraisals for charter-free asset value and charter-adjustments are as of March 31, 2020

• Adjustments to calculate net asset value include:

−

Net debt, which is adjusted to include non-cash fair value adjustments and deferred finance costs

−

Net working capital & other, which includes DAC’s equity stake in the Gemini joint venture at carrying value

$1,896 ($1,452) $41 $485

24

Summary

k

Financial Strategy Positioning Danaos for Success

Balanced chartering strategy to ensure cash flow visibility with 90% and 75% of 2020 and 2021 revenues contracted(3) ✓ Opportunistic vessel acquisition strategy

• Acquired two vessels in last six months, both of which have been fixed on multi-year charters and are

expected to contribute $12 in annualized EBITDA

• One additional 8,500 TEU vessel acquired and expected to be delivered within Q2 2020

✓ Following consummation of recent equity offering the Company is permitted, under its loan agreements, to re-instate dividends ✓

(1) Calculated as the sum of contractual principal debt repayment and lease repayments under sale leaseback structure. (2) Net leverage is a non-GAAP measure. Calculated as Net Adjusted Debt / Adjusted EBITDA. Adjusted EBITDA is a non-GAAP measure. See appendix for definitions and reconciliations to the nearest GAAP measure. (3) Assumes contracted vessels operate on gross daily charter rate, accounts for revenue exclusively derived from long-term charter contracts.

26

Continued de-levering from strong contracted cash flows

• Minimum debt amortization of $300mm(1) in 2020 and 2021

✓

33% reduction in leverage between 2014 and today(2)

7.2x 5.1x 4.8x

2014 2018 2020 Q1

Appendix

Substantial Fleet Employment and Coverage

(1) Age as of March 31, 2020

5x

13,100 TEU

5x

10,100 TEU

9x

8,500 – 9,600 TEU

9x

6,400 – 6,500 TEU 2018 2019 2020 2021 2022 2023 2024 2025 Hyundai Honour Hyundai Respect Hyundai Smart Hyundai Speed Hyundai Ambition Pusan C Le Havre Express Berlin Express Rome Express Athens Europe America Phoebe Niledutch Lion CMA CGM Attila CMA CGM Tancredi CMA CGM Bianca CMA CGM Samson CMA CGM Melisande Performance Dimitra C CMA CGM Moliere CMA CGM Musset CMA CGM Nerval YM Mandate CMA CGM Rabelais CMA CGM Racine 2028

Charterer Age1 Vessel

8.1 8.1 7.9 7.8 7.8 13.6 13.4 9.1 9.0 8.9 15.6 15.4 14.9 11.8 8.7 8.6 8.4 8.3 8.1 18.1 17.8 10.5 10.1 9.9 9.9 9.8 9.6 9.6

Total Charter Revenue Contribution

38% 9% 27% 24% 28

ONE

Substantial Fleet Employment and Coverage

Charterer Age1 Vessel Total Charter Revenue Contribution

10x

4,300 – 5,500 TEU

8x

3,400 TEU

11x

2,200 – 2,600 TEU 2018 2019 2020 2021 2022 2023 2024 ANL Tongala Derby D Seattle C YM Vancouver Zim Rio Grande Zim Sao Paolo Zim Kingston Zim Monaco Zim Dalian Zim Luanda Dimitris C Colombo Singapore Express Argentina Express Brazil Express France Express Spain Express Black Sea Future Sprinter Vladivostok Advance Stride Progress C Amalia C Highway Bridge Danae C MSC Zebra 16.1 15.9 12.6 12.4 11.7 11.5 11.4 11.2 11.0 10.8 19.1 16.1 15.6 9.9 9.7 9.5 9.2 9.0 23.0 22.8 22.7 22.6 22.6 22.1 22.1 22.1 22.0 18.8 18.3

(1) Age as of March 31, 2020

2% 1% 1% 29

Adjusted EBITDA

Source: Company filings.

Three Months Three Months Twelve Months ended ended ended ($ In thousands)

• Mar. 31, 2020
• Mar. 31, 2019
• Mar. 31, 2020

Net income / (Loss) from Continuing Operations (unadjusted) $29,089 $33,443 $126,899 Adjustments: Depreciation 24,581 23,766 97,320 Amortization of deferred drydocking & special survey costs 2,310 2,191 8,852 Amortization of defered realized losses of cash flow interest rate swaps 903 893 3,632 Amortization of deferred finance costs 4,192 5,126 16,488 Interest income (1,714) (1,596) (6,532) Interest expense 12,259 12,885 54,577 EBITDA $71,620 $76,708 $301,236 Stock based compensation 298 830 3,709 ADJUSTED EBITDA $71,918 $77,538 $304,945

Reconciliation of Net Income / (Loss) to EBITDA and Adjusted EBITDA March 31, 2020

30

Historical Adjusted EBITDA

Source: Company filings.

31

Historical Reconciliation of Net Income to EBITDA and Adjusted EBITDA Years ended 2012 – LTM 1Q 2020

Twelve months ended ($ in thousands) 2012 2013 2014 2015 2016 2017 2018 2019

• Mar. 31, 2020

Net Income $(105,204) $37,523 $(3,920) $117,016 $(366,195) $83,905 $(32,936) $131,252 $126,898 Adjustments Depreciation 143,938 137,414 137,061 131,783 129,045 115,228 107,757 96,505 97,321 Amortization of deferred drydocking & special survey costs 6,070 5,482 4,387 3,845 5,528 6,748 9,237 8,733 8,851 Amortization of deferred realized losses on cash flow interest rate swaps 3,524 4,017 4,016 4,017 4,028 3,694 3,694 3,622 3,632 Amortization of finance costs and debt discount 14,314 15,431 15,070 14,038 12,652 11,153 14,957 16,866 15,961 Finance costs accrued (Exit Fees under our Bank Agreements) 2,762 3,763 3,745 3,639 3,447 3,169 2,059 556 526 Interest Income (1,642) (2,210) (1,703) (3,419) (4,682) (5,576) (5,781) (6,414) (6,532) Interest Expense 87,340 91,185 79,980 70,397 70,314 75,403 70,749 55,203 54,577 EBITDA 151,102 292,605 238,636 341,316 (145,863) 293,724 169,736 306,323 301,236 Adjusted for: Impairment loss 129,630 19,004 75,776 41,080 415,118

• 210,715
• Gain on debt extinguishment
• (116,365)
• Re-financing professional fees
• 14,297

51,314

• Accelerated amortization of accumulated other comprehensive loss
• 7,705
• 1,443
• Realized (Gain) / Loss on derivatives

150,910 144,254 119,612 52,125 5,397

• Unrealized (Gain) / Loss on fair value of derivatives

739 (22,121) (24,915) (16,285) (4,648)

• Stock based compensation

139 75 638 88 76

• 1,005

4,241 3,709 Bad debt expense

• 15,834
• Impairment loss component of equity loss on investments
• 14,642
• Loss on sale of HMM securities
• 12,906

2,357

• Impairment loss on securities
• 29,384
• (Gain) / Loss on sale of vessels

(830) 449 (5,709)

• 36
• Adjusted EBITDA

431,690 434,266 404,038 418,324 350,587 310,378 317,849 310,564 304,945

Adjusted Net Income

Source: Company filings.

Reconciliation of Net Income to Adjusted Net Income and Adjusted Earnings per Share March 31, 2020

Three Months Three Months Twelve Months ended ended ended ($ In thousands, except per share items)

• Mar. 31, 2020
• Mar. 31, 2019
• Mar. 31, 2020

Net income / (Loss) from Continuing Operations $29,089 $33,443 $126,899 Adjustments: Amortization of deferred finance costs 4,192 5,126 16,488 ADJUSTED NET INCOME $33,281 $38,569 $143,387 ADJUSTED EARNINGS PER SHARE Diluted net income per share $1.34 $2.53 $7.71 Diluted weighted average number of shares 24,789 15,237 18,593 32

Historical Adjusted Net Income

Source: Company filings.

33

Reconciliation of Adjusted Net Income Years ended December 2012 – LTM 1Q 2020

Twelve months ended 2012 2013 2014 2015 2016 2017 2018 2019

• Mar. 31, 2020

Net Income $(105,204) $37,523 $(3,920) $117,016 $(366,195) $83,905 $(32,936) $131,252 $126,899 Adjust for: Impairment loss 129,630 19,004 75,776 41,080 415,118

• 210,715
• Gain on debt extinguishment
• (116,365)
• Amortization of finance costs

14,314 15,431 15,070 14,038 12,652 11,153 11,771 10,795 10,165 Debt discount amortization

• 3,186

6,071 5,796 Finance costs accrued (Exit Fees under our Bank Agreements) 2,762 3,763 3,745 3,639 3,447 3,169 2,059 556 527 Re-financing professional fees

• 14,297

51,314

• Accelerated amortization of accumulated other comprehensive loss
• 7,705
• 1,443
• Unrealized (Gain) / Loss on fair value of derivatives

739 (22,121) (24,915) (16,285) (4,648)

• Realized loss on over-hedging portion of derivatives

19,042

• Bad debt expense
• 15,834
• Impairment loss component of equity loss on investments
• 14,642
• Loss on sale of HMM securities
• 12,906

2,357

• Impairment loss on securities
• 29,384
• (Gain) / Loss on sale of vessels

(830) 449 (5,709)

• 36
• $60,453

$54,049 $60,047 $159,488 $140,881 $114,881 $131,188 $148,674 $143,387

2020 Free Cash Flow

Source: Company filings.

34

Reconciliation of Free Cash Flow

Twelve months ended Twelve months ended ($ in thousands)

• Dec. 31, 2019
• Mar. 31, 2020

Net Income $131,252 $126,898 Adjustments Depreciation 96,505 97,321 Amortization of deferred drydocking & special survey costs 8,733 8,851 Amortization of deferred realized losses on cash flow interest rate swaps 3,622 3,632 Amortization of finance costs and debt discount 16,866 15,961 Finance costs accrued (Exit Fees under our Bank Agreements) 556 526 Interest Income (6,414) (6,532) Interest Expense 55,203 54,577 EBITDA 306,323 301,236 Adjusted for: Stock based compensation 4,241 3,709 Adjusted EBITDA $310,564 $304,945 Net cash interest (80,772) (79,290) Equity income / (loss) on investments (1,601) (3,232) Revenue recognition (non-cash) (27,682) (22,842) Other working capital (8,831) (5,979) Payments for dry-docking & special survey costs deferred (7,157) (11,885) Operating cash flow 184,520 181,718 Debt Amortization (124,358) (131,157) Adjusted Free Cash Flow 60,162 50,560

Appendix: Danaos Net Asset Value(1)

(1) Net Asset Value (NAV) is used to assess compliance with our credit facility covenants, and management believes that many investors use NAV as a reference point in assessing valuation of fleets of ships and similar assets. (2) As calculated in accordance with the financial covenants contained in the Company’s credit facilities as of March 31, 2020, on a charter-inclusive basis, as follows (1) for any vessel having a charter with more than 12 months remaining duration, the present value of the “bareboat-equivalent” time charter income from such charter (contracted revenue thereunder less forecasted operating expenses, insurances and dry-docking costs), plus (2) the present value of the residual charter-free value of any vessel (estimated based on December 31, 2019 broker valuations using vessel age as of the end of applicable charter, if any), each discounted to present value using a discount rate 7.0%. See “Item 5. Operating and Financial Review and Prospects” in the Company’s Annual Report on Form 20-F filed with the SEC on February 27, 2020. These calculations of vessel value may not be comparable to other methods of determining vessel values or reported book value ($2.4 billion as of March 31, 2020). Vessel values are highly volatile and contracted charter revenue is subject to counterparty performance and may not be transferable upon sale of a vessel. As such, the Company’s estimates of market value may not be indicative of the current or future value of its vessels, or prices that the Company could achieve if it were to sell the vessels. (3) Represents advances for scrubber installations. Included in Other non-current assets on the Company’s balance sheet. (4) Consists of (i) Current portion of long term debt, net of $119.525 million and (ii) Long-term debt, net of $1,245.785 million plus deferred finance costs, net, of $31.0 million and debt fair value adjustment of $18.5

• million. Does not include accumulated accrued interest of $179.8 million.

(5) Excludes the following non-cash items included on the Company’s balance sheet, as of March 31, 2020: (i) unearned revenue liabilities totaling $38.196 million relating to an accounting charge recognized upon the Company’s receipt of the ZIM and HMM notes in respect of charter amendments ($25.495 million Unearned revenue, net of current portion and $12.701 million included in Unearned revenue, current portion), (ii) Other current assets ($9.351 million) and Other non-current assets ($27.245 million) related to straight-line revenue recognition totaling $36.596 million, (iii) other non-current assets ($2.99 million) related to deferred Handling Fees and (iv) liabilities related to straight-line revenue recognition totaling $0.923 million (Other current liabilities of $0.424 million and $0.499 million included in Other long-term liabilities). (6) Represents investment in Gemini JV. (7) Included in Other non-current assets on the Company’s balance sheet.

35

(in US$ thousands)

Charter Adjusted Asset Value Charter Adjusted Fleet Value(2) $1,879,131 Advances for vessels acquisitions(3) 5,076 Advances for vessels additions(3) 11,531 Total Charter Adjusted Asset Value $1,895,738 Less: Net Debt Bank debt(4) $1,414,726 Long-term leaseback obligation (including current portion) 134,338 Less: Cash and cash equivalents (97,019) Total Net Debt $1,452,044 Plus: Net Working Capital & Other(5) Accounts receivable, net $7,921 Inventories 8,708 Prepaid Expenses 938 Due from related parties 22,063 Other current assets & non-current assets 6,150 Investments in affiliates(6) 10,510 Zim notes(7) 16,005 HMM notes(7) 8,277 Less: Accounts payable (12,838) Accrued liabilities (13,692) Unearned revenue (5,360) Other current liabilities (7,425) Total Net Working Capital & Other $41,256 Net Asset Value: $484,950