S&P upgrades Danaos

S&P said it upgraded Danaos Corp. to BB from BB-, raised the issue rating on its senior unsecured debt to BB from B+ and revised the recovery rating on it to 3 from 5 and the rounded recovery estimate to 65% from 25%.

Danaos has continued to secure new charters for its containerships at record-high rates and with longer durations than previously, which partly insulates the company from the industry's above-average underlying volatility and improves earnings visibility in the next two-to-three years, S&P said.

“We forecast that Danaos' 2022 EBITDA of close to $750 million will exceed the 2020 level by more than 2x and our August 2021 base case of up to $650 million. This, combined with management's recent debt-repayment measures, will result in improved financial metrics consistent with a higher rating,” S&P said in a news release.

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