Danaos quarterly profit falls 73pc to US$33.9 million as sales slip 5pc
CONTAINERSHIP charter firm Danaos third quarter net profit fell 73 per cent year on year to US$33
CONTAINERSHIP charter firm Danaos third quarter net profit fell 73 per cent year on year to US$33.9 million, drawn on revenues of $111.8 million, down 5.08 per cent.
John Coustas, CEO of Athens-based Danaos, said the charter market for containerships has been stronger 'particularly for vessels larger than 5,500 TEU, although we have also seen an improvement in charter rates for panamax vessels'.
Panamax containerships, the largest able to transit the old locks at the Panama Canal, commonly have a capacity of around 4,500 TEU.
Dr Coustas said the improvement in the charter market 'may be partially due to a decrease in fleet capacity as vessels are being temporarily removed from the fleet to be retrofitted with scrubbers in preparation for IMO 2020 sulphur emissions regulations.
'Larger vessel classes have seen the greatest downtime, and we expect this to continue through 2020 and help contribute to a healthy charter market. This coincides with improving underlying market demand supply fundamentals.
'For 2020, we are aligned with the shipping analyst reports and our expectation is that container trade demand growth will outpace supply growth for the first time in almost 10 years,' said Dr Coustas.
He pointed to an International Monetary Fund forecast that world GDP will grow 3.5 per cent in 2020, and he said Danaos expects container traffic growth will exceed that level and 'grow by up to four per cent in 2020. On the supply side, capacity growth is not expected to exceed three per cent in 2020.'
His company has a fleet of 328,000 TEU, making it the third largest of the publicly traded pure-play containership charterers after Seaspan and Costamare. Danaos customers include CMA CGM, Hyundai Merchant Marine, Mediterranean Shipping Co, Yang Ming, Hapag-Lloyd, Zim and others.