Dr. John Coustas – President & CEO Evangelos Chatzis – Secretary & CFO

Omar Nokta – Global Hunter Securities LLC Gregory Lewis – Credit Suisse Urs Dur – Clarksons Capital Markets Amit Solomon – Neuberger Berman Mark Suarez – Euro Pacific Capital Markets

Good morning 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 speak as of today and we undertake no obligation to update. Factors that might affect future results are discussed in our filings with the SEC and we encourage you to review the detailed Safe Harbor and risk factors 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.

Now, let me turn the call over to Dr. Coustas who will provide the broad overview of the quarter.

Thank you, Evangelos. Good morning and thank you for joining today’s call to discuss our results for the third quarter of 2013.

The third quarter of 2013 has been an uneventful one for the containership industry as the overall fundamentals have remained weak and all metrics inevitably lead to the conclusion that 2013 will be a sluggish year. The liner companies, in their attempt to manage over-capacity on the Europe - Far East route where they need to deploy the super post Panamaxes being delivered, are cascading smaller post-panamaxes to North - South trades thereby creating over-capacity in these routes that has led to a significant decrease in box rates.

This also affects the charter market of the Panamax segment because of the cascading effect. The excess in shipbuilding capacity remains a risk factor on the supply side partially mitigated by increased scrapping activity over the last 12 months.

However, the fact is that a sustainable recovery in the containership market will ultimately be driven by the rationalization of liner networks and demand growth, with the main determining factor in the medium term being the return of Eurozone to positive GDP growth. Danaos is reporting yet another solid quarter with adjusted net income of $13.4 million, or $0.12 a share, $2.2 million lower than the third quarter of 2012 due to the weaker charter market today when compared to one year ago.

However, the few vessels in our fleet deployed under short term charters represent only 3% of our revenues and already operate close to break-even levels. This means that while we are insulated from a prolonged weak charter market with our 97% contract coverage, an improvement in the market fundamentals can only mean upside for our results.

Another visible upside driver of our results in the coming quarters is the anticipated reduction in finance costs as a result of the rapid de-leveraging of the company in combination with the expiration of swap contracts. During the first nine months of the year we have reduced debt by $120 million, while we anticipate paying down debt by approximately a further $50 million until the end of 2013.

We continue to execute our fleet modernization program having sold 8 of our older vessels with an average age of 25 years for net proceeds of $52.3 million and we are still scanning the market for accretive acquisition opportunities of younger tonnage to complement the recent additions of two 2,500 TEU geared containerships to our fleet. With a resilient business model both from an operating and financial standpoint, we will continue to manage our fleet efficiently, while we will continue focusing on the rapid de-leveraging the company and the creation of value for our shareholders.

With that I’ll handover the call back to Evangelos who will take you through the financials for the quarter.

Thank you and good morning again to everyone and thanks for joining us today. I will briefly review the results for the quarter and then give the chance to the participants over the call to place questions.

During the third quarter of 2013 we had an average of 61 containerships compared to 64 containerships for the third quarter of 2012. Implementing our fleet renewal program during the first nine months of the year we concluded the sale of five of our oldest vessels while we purchased two, two and a half year containerships.

During the fourth quarter we’ve sold the further three containerships. Following the already consummated sales and the reactivation of Messologi during the first quarter of this year, we currently have two vessels on cold lay-up, Marathonas and the Duka.

Given the state of the market, we currently do not anticipate to reactivate these two vessels before the second quarter of next year. Our adjusted net income was $13.4 million or $0.12 per share for the quarter down by $2.2 million or $0.02 per share when compared to the adjusted net income of $15.6 million or $0.14 per share for the third quarter of 2012.

This decrease was the result of decreased operating revenues due to the softening of the charter market during the course of the last 12 months. We would like to note here that beside the chartering risk which at the end of the day is manageable with our strong contract coverage, the most important driver in our earnings today is related to the hedging we have in place for interest rate swaps.

Indicatively our adjusted net income for the third quarter at $13.4 million would have been $51 if the kind of interest rate swaps were not in place. These swaps start expiring from the fourth quarter of this year through the end of 2015 and as a result we expect a gradual consistent improvement in earnings over the next quarters given the market expectations for persistingly low LIBOR interest rates.

With the type of duration at nine years well exceeding the two and a half year remaining duration of the swaps we believe that we will be able to take advantage of the anticipated flow LIBOR environment on the back of solid contracted income and narration. Operating revenues decreased by 5.1% or $7.9 million to $148.4 million in the third quarter of 2013 compared to $156.3 million in the third quarter of 2012.

As mentioned before this decrease is mainly attributable to the softer charter market between the two periods as well as the vessel sales partially offset by the incremental revenue contribution of the new ships that have joined our fleet. Vessel operating expenses decreased by 1.9% or $0.6 million to $30.7 million in the current quarter from $51.3 million in the third quarter of 2012.

The daily operating cost for the current quarter was $5,856 per vessel per day effectively the same as in the first quarter of 2012. This is a testament to the operational efficiency of the company as these daily OpEx figures are one of the most competitive in the industry.

General and administrative expenses decreased by $0.2 million to $4.9 million in the current quarter from $5.1 million in the third quarter of 2012 mainly as a result of the decrease in the average number of vessels in our fleet between the two quarters with the sale of the older vessels. Interest expense decreased by 5.4% or $1.3 million to $22.9 million in the current quarter compared to $24.2 million in the third quarter of 2012.

The decrease in interest expense was mainly due to the lower average indebtedness between the two quarters of $121.2 million down to $3.3 billion in total in the current quarter from $3.42 in the third quarter of 2012 as well as marginal decrease in the cost of debt servicing between the two quarters mainly driven by lower LIBOR rate. As we’re rapidly deleveraging the company’s balance sheet with effectively all of the generated free cash flow, we expect finance costs to continuously improve in the coming quarters in combination with swap expirations as mentioned earlier.

Realized losses on interest rates swaps also decreased by $4 million to $37.7 million in the current quarter compared to $41.7 million in the third quarter of 2012. This decrease is due to the swap expirations and the lower average notional amount of swaps between the two quarters.

And finally, adjusted EBITDA decreased by $6.7 million to $109.5 million in the current quarter, from $116.2 in the third quarter of 2012 as a result of the softer charter market between the two periods that was discussed earlier. With that I would like to thank you for listening to this first part of our call.

Dr. Coustas and I will now take your questions.

Operator?

Thank you. Good afternoon guys.

I just wanted to -- a couple of questions, first just maybe just a bit more color from your end on the expiring swaps that you have been talking about for the past few quarters. You talked about how that obviously lead to improving earnings over the next couple of quarters.

Could you give a perspective on what that actually does, balance sheet wise, how does that impact your agreements with your lenders, how does that sort of put you in position with respect to your comments?

Yes, well the effect of that is, it will also be bound to the income statement and to the cash flow on a pro forma basis let's say for 2013, our net income would exceed $200 million if the swaps were not there and this is where we get to, once the swaps expire provided of course that the LIBOR curve that is currently assumed holds up and we don’t have a rapid increase in floating rates. So this will of course, more than almost triple free cash flow generation.

All of that money is currently designated to reduce that as we have decided to utilize our free cash flow to de-lever the company but I also believe that come 2015, we will have much more flexibility with all these cash available and many more other options to explore with our banks and we will definitely, the company will definitely be in a much better place.

Okay. Thank you.

And just on the topic of selling assets, you have obviously sold eight ships out of the nine that you have targeted, targeted earlier this year, you mentioned you got over $15 million or so of cash in the door. You invested about 18 of that in these two second hand ships or the modern second hand ships.

We are coming towards to the end of the year with only two months to go, how comfortable do you feel that you will be able to deploy some of this capital before year end and if not, if you are unable to get that money invested before year end, do you think there is scope with your lenders to be able to extend maybe the ability to put that money to work into next year or would you just go ahead and pay down debt with it?

Well we believe Omar, we will be able to, let's say to use much of it. So we are presently in close negotiations for some more vessels.

So I am sure that you know, we will utilize most of it by couple of vessels until year end.

Okay. And presumably these would also be geared ships like the two you recently bought?

Yes, this is a kind of a segment that we are concentrating. It's the segment that we do not have let's say any exposure at present and it's the segment that we believe is more insulated from the cascading and already we have a number of Panamaxes and we believe that this is a segment that we definitely have some kind of upside.

Yes, great. Thank you, thanks for the time.

Thank you, thank you, Omar.

Thank you and good afternoon.

Hi Greg!

John, could you touch a little bit more about what's going on in the Panamax market and the reason that I am asking is it seems that every once or beyond the peak season we start to see Panamax vessels idol that starts to move higher and it looks like it's continuing. We are going to see a repeat of that over the next couple months.

When we think about the fleet and clearly you still have a handful of Panamax, your too laid up vessels of Panamax. How concerned are you about your 4,000 class vessels over the next one to two years in terms of, as these vessels continue rollout contract, should we think about some more of these vessels potentially being laid up or is the time of some of these vessel contract expirations in sort of Q1, Q2 of next year, is that sort of just coincide with another recovery in for the peak season?

Well, definitely there is let’s say a kind of a winter lull in the container market and we are definitely going to see some more activity from spring next year. There is no doubt, the Panamax market is difficult state because of the continue influx of large ships and cascading.

The problem is that that we don't really have any role in the market and that is why cannot really absorb these vessels in the peripheral trades. So, what we really need is to see a revival of growth.

Unfortunately, we see that Asia is really, the performance in Asia is not anything fantastic. Brazil, India are also, let's say in a retrenchment mode.

So really, I think we have a larger problem on the demand side, which is the one that will pull out all the slack from the supply side.

Okay. So, when we think about the Panamax vessels specifically, they’re early 1990's built once in the fleet.

Should we think about those exiting the fleet in the next 12 months, is there an appetite for some operators to purchase these or the most likely scenario for Panamax is not necessarily in your fleet, but in the global fleet, in that sort of late 80s, early 90s built vessels. Is it reasonable to think that a lot of these assets get scrapped?

Well, this is, let's say, a kind of a selective question because there are, let's say, good and economic ships that were built during that time and ships which were built with fire kind of consumption and which maybe will not have a kind of a future, it depends on our ships that are able to slow steam, some other ones that are unable to slow steam, so it's not let's say just purely an age issue. It has also to do with the condition and we have seen ships being scrapped, which were late 90s or even 2000, because these ships, they had some kind of a problem.

Okay, great. And then, just one final question on new buildings, we have seen more than a few new build orders of super post Panamax vessels this year.

Is this a trend that we should think about continuing for the next 12 months or from conversations you’ve had with some of the major liner companies, do you get a sense that a lot of these, a lot of the major liner companies kind of have their growth platforms and placed in all -- not really looking to continue to go to yards and place new orders or should we expect to see some more orders being placed?

Well, the people who have already order ships, I think they are – they have already had enough. What happens in these cases is that, if there are some liner companies that are, let's say that wants to participate in some alliance, they need to contribute some vessels, so these are the ones that maybe the once who have not ordered that may decide, let's say to approach the yards.

But with the overcapacity at present, I am sure that people are having second thoughts about ordering. Despite the fact that prices are very attractive, but on the other hand, the price maybe very attractive on the other hand, if you are not able to really to use the ship, it doesn't make any sense.

The big guys, I know that they are really, full from, super post Panamaxes and there is no intention in continuing any kind of ordering, until really they see a very solid return.

Okay, perfect, thank you for the time.

Thank you.

Good morning, good afternoon guys.

Hi, Urs.

Hi, I was wondering, I really want to talk more about the market and you really touched on everything there with Greg. So can you remind investors, what your reach ordering risk is in relationship to EBITDA, how much is exposed next year, maybe on a percentage basis.

I still think it's relatively small, if I am not mistaken.

Yes, as we mentioned in our release for the next 12 months, out of every $100 of revenue that we generate today, 97 will still be there, will be contracted. So 3% of our revenues is at stake, and it's a lower percentage in terms of EBITDA.

We effectively and to touch upon the point raised earlier on the Panamaxes, almost all of the ships that we have on spot charters which are Panamax sort of size after the sale of the older Panamaxes are already earning rates about close to breakeven. So, yes that market may remain soft and challenge and they may earn effectively zero, but we do not stand to take a big hit there, it's already factored in, so whatever market improvement will reflect on our results positively.

Great. And can you, and as you talked about the next 12 months, can you give us a little bit of color for say, 15 and 16 because most of believe that, demand exceeds supply growth in the coming years although we still have a lot of big ships delivering and it's certainly still a depressed market and take the long time for it to come off.

But that 15 and 16, you could see an improving rate environment, as well as an improving global economy and so what's the charter coverage looking like just reminding everybody where it is for say 15 and 16 on a similar exposure basis?

Charter coverage is north of 90% for 2015 and I don't remember the exact number for ’16 off the top of my head, it's close to -- is again close to 90, high 80s maybe close to 90 for ’16. So we don't have much tonnage coming of charter.

We have charter expirations from end of 2016 or 2017 onwards. Beyond that it's the ships that we currently have which – we basically from our fleet today, we have eight ships that ran on spot and two ships that are laid up.

So this is actually the spot fleet, from the contracted ships, the next opening is at the end of 2016.

Okay. That’s very helpful and thank you very much for your time guys.

Thank you, Urs.

Good afternoon guys, nice quarter. I wanted to ask you – just one question.

I notice that you have had a relax of some of the covenants with your banks earlier with respect to selling and buying ships, and this is more with respect to your ability to pay a dividend because we are looking at a stock that is state of, sort of the secular discount to peers in the market. And I think one major thing that can change that is if you were able to initiate even a small dividend.

So if you can just comment on your ability to -- since you have been negotiating with the creditors to go and establish, I think even the dividend in the range of $40 million to $50 million a year would still enable you to pay down your debt, but if you trade to your comparable that would leave with the stock level from here. And that would be beneficial both for your shareholders as well as for your creditors who have an interest in the equity.

Yes. As you know and you mentioned it.

We have certain restrictions from the bank agreement that we have and we are currently dedicating all of our free cash flow to reduce that. I think that we will not be able to initiate a discussion on a dividend before 2015.

You have to have certain conditions met, we need to bring down leverage beyond a certain, below a certain threshold, which we expect to happen in ’15. The market will hopefully be better and this will of course facilitate as a discussion and of course as mentioned previously, with all these expensive swaps expiring by then, our free cash flow will materially increase and then I think we stand a good chance of getting to allocate some of our cash, as a dividend.

We do not foresee that we will be able at least for next year to have such a discussion with our banks, we hope to be in a position to do so from 2015 onwards.

Okay. Thank you.

Yes, good morning, thanks for taking my call, you know, my questions. Just to go back to what you mentioned, you commented on maybe engaging in one or two more transactions before year and I am wondering what are the returns that you are seeing in geared containership market vis-à-vis some of the Panamax vessels, I mean, obviously you don’t have the cascading effect as pronounced as in Panamax segment if you will, but I mean they are trading at very near or at scrapping value.

So I am just wondering what you are seeing there that you’re not seeing in the Panamax segment?

Are you meaning the geared segment that we are investing?

Yes, yes.

Well, at the present, yes okay, these ships are operating at well above OpEx not let's say dramatically, but they have charter rates between $7,500 and $8,000 a day. OpEx for these ships is around 6 or something.

So definitely there is a plus, but where we see really the benefit in this segment is that it’s a segment that is, let's say insulated to a larger extend from cascading. It's segment that doesn’t have any building activity and when demand picks up, there will be also a significant request from ships of smaller ships of 1,700 TU to upgrade in the services to 2,500 TU and there are a lot of trades with 1,700 TUs which will, once they get upgraded to the next size up is the 2,500 and that’s where we see really demand being generated for the ships.

To build a new ship of 2,500 TU today you need definitely well in access of $30 million. So the basis of that kind of replacement cost will be very difficult, I mean to justify any new building.

Hence the second hand market is going to see drop.

Got it. I was more asking the question of if you compare the returns in the geared containership market or the vessel vis-à-vis second hand Panamax between 10 and 15 years, what are the other returns that definitely, in your view, given that a lot of these Panamax vessels trading at very near scrap value at this point in the cycle?

Yes, well as I say, it's a very, I mean the Panamax vessels will be much more difficult situation because the supply over there is considerably more and they suffer from cascading. So in larger ships, push down smaller ones.

I still believe that the larger Panamaxes will still find let's say some employment, but some good employment but only when growth returns and services will need to be upgraded specially into Asia.

Got it, okay. And now just to go back on the laid up ships you mentioned you still have two laid up Marathonas and the Duka, I know that they were built in the early 1990s, is there an opportunity here to maybe sell those assets away as opposed to reactivating them, I think you said potentially after the second quarter of next year?

We believe that these assets have potential. They are very good ships and we operate also the sister ships efficiently.

So there is no intention of scrapping at this moment.

Great. That’s all I have for now.

Thanks for your time as always.

Okay, thank you.

Thanks everyone for joining this conference call and for your continued interest in our story. We look forward to host in our new next earning calls.

Thank you.