International Shipholding Corporation Reports Second Quarter 2013 Results

  International Shipholding Corporation Reports Second Quarter 2013 Results

   Declares second quarter dividend of $0.25 per share on its Common Stock

Business Wire

MOBILE, Ala. -- July 31, 2013

International Shipholding Corporation (NYSE: ISH) today announced financial
results for the quarter ended June 30, 2013.

Second Quarter 2013 Highlights

  *Reported net income of $1.9 million for the three months ended June 30,
    2013
  *Priced $27.5 million of 9% Series B Cumulative Redeemable Perpetual
    Preferred Stock on July 25, 2013

  *Declared a second quarter dividend of $0.25 per share of common stock
    payable on September 4, 2013 to shareholders of record as of August 16,
    2013
  *Paid a $2.375 per share dividend on its Series A Preferred Stock on July
    30, 2013

Net Income

The Company reported net income of $1.9 million for the three months ended
June 30, 2013, which included a non-operating gain of $1.8 million from its
Yen denominated loan. For the comparable three months ended June 30, 2012, the
Company reported net income of $704,000 which included a non-operating loss of
$1.7 million on its Yen denominated loan.

Mr. Niels M. Johnsen, Chairman and Chief Executive Officer, stated: “We
continue our strategy of operating a diversified fleet, primarily on medium to
long term contracts, and remain focused on taking advantage of attractive
growth opportunities and strengthening our balance sheet. In July, we
successfully priced a $27.5 million Series B Cumulative Redeemable Perpetual
Preferred Stock offering which follows our previous Series A Preferred Stock
offering earlier this year.”

“We will continue to focus on identifying maritime transportation needs in
niche markets and capitalize on accretive acquisition opportunities to enhance
shareholder value. Given our strong contract coverage and stable cash flows,
we continue to provide our shareholders with value through a quarterly
dividend payment. For the second quarter, our Board of Directors declared a
common stock dividend payment of $0.25 per share which represents the 20^th
consecutive dividend payment since reinstituting our dividend policy in the
fourth quarter of 2008.”

Gross Voyage Profit

The Company’s second quarter 2013 gross voyage profit representing the results
of its six reporting segments was $13.3 million, compared to $13.9 million in
the comparable 2012 three month period. The comparable results by operating
segment are shown below.

                                                                                        
(All Amounts        Jones      Pure Car      Dry Bulk                      Specialty
in Millions)        Act        Truck         Carriers      Rail-Ferry      Contracts      Other      Total
                               Carriers
                                                                                                     
Second                                                                                 
Quarter 2013
Gross Voyage      $5.5        $4.6          $0.4          $1.7            $1.0           $0.1       $13.3
Profit
                                                                                                     
Depreciation      ($1.2)    ($2.1)      ($1.6)      ($0.4)        ($0.5)       $0.0     ($5.8)
Gross Profit      $4.3      $2.5        ($1.2)      $1.3          $0.5         $0.1     $7.5
(After
Depreciation)
                                                                                                     
Second
Quarter 2012
Gross Voyage      $1.1        $6.8          $2.9          $1.5            $1.3           $0.3       $13.9
Profit
                                                                                                     
Depreciation      ($0.3)    ($2.6)      ($1.6)      ($0.7)        ($0.5)       ($0.0)   ($5.7)
Gross Profit      $0.8      $4.2        $1.3        $0.8          $0.8         $0.3     $8.2
(After
Depreciation)
                                                                                                     
Variance
Gross Voyage      $4.4        ($2.2)        ($2.5)        $0.2            ($0.3)         ($0.2)     ($0.6)
Profit
Depreciation      ($0.9)    $0.5        $0.0        $0.3          $0.0         $0.0     ($0.1)
Gross Profit      $3.5      ($1.7)      ($2.5)      $0.5          ($0.3)       ($0.2)   ($0.7)
                                                                                                    

For a reconciliation of the numbers presented above to GAAP figures, please
see the attached Non-GAAP Reconciliation Statement.

The improved gross voyage profit for the Jones Act segment reflects the
inclusion of United Ocean Services (“UOS”), which we acquired on November 30,
2012. While year over year the Jones Act segment benefited from UOS, the
results of UOS in the quarter were impacted by 79 non-operating days while two
of the units underwent scheduled drydockings. Gross voyage profit on the Pure
Car Truck Carrier (“PCTC”) segment decreased due primarily to lower charter
hire rates on one U.S. Flag PCTC (effective July, 2012) and our International
Flag PCTC (effective April, 2013). Supplemental cargo results, a component of
the PCTC results, were approximately $600,000 lower in the quarter when
compared to the comparable 2012 second quarter. For the six months ended June
30, 2013, supplemental cargo results were comparable to the six month period
ended June 30, 2012. The dry bulk market, while slightly improved from the
beginning of the year, continues to be at depressed levels, producing lower
results than the comparable 2012 second quarter. The Rail Ferry segment
reports higher northbound volumes which produced slightly better results year
over year. The Specialty Contracts segment reported a decrease in gross voyage
profit due primarily to our ice-strengthened vessel, which performed below
expectations. The Company’s Other segment, consisting mainly of chartering
brokerage and agency services, reported lower brokerage revenues.

Administrative and General

Administrative and general expenses in the second quarter of 2013 were $6.2
million as compared to $4.7 million in the same period of 2012. Higher
expenses associated with the integration of UOS, as well as accrued bonus
payments, were the primary reasons.

Interest and Other

Interest expense for the three months ended June 30, 2013 was approximately
$204,000 lower than the comparable three months in 2012. Our service
obligations were reduced from the proceeds on the sale of two International
Flag PCTCs and two U.S. Flag PCTCs in a sale-leaseback transaction, as well as
regularly scheduled debt payments. During the three months ended June 30,
2013, the Japanese Yen weakened in relation to the U.S. Dollar from 94.22 to
99.15, producing an exchange gain of $1.8 million.

Balance Sheet

The Company’s working capital at June 30, 2013 was $15.5 million, an increase
of $500,000 from March 31, 2013. Cash and cash equivalents balance was
approximately $22.4 million while capital expenditures during the six month
period were $14.1 million. The Company’s total debt obligations, at June 30,
2013, were approximately $213 million.

Dividend Declarations

The Company’s Board of Directors approved a per share dividend payment on July
30, 2013 of $2.375 on its Series A Preferred Stock representing a regular
quarterly payment. Additionally, the Board of Directors declared a $0.25
dividend payable on September 4, 2013, for each share of common stock owned on
the record date of August 16, 2013. All future dividend declarations remain
subject to the discretion of International Shipholding Corporation’s Board of
Directors.

Outlook

The Company reaffirms that its projected 2013 net income, before preferred
stock dividends, is expected to be between $10 and $12 million, while lowering
its anticipated EBITDA ^ to within a $60 to $63 million range as a result of
the depressed dry bulk market and extended dry dock days on the UOS units.

All 2013 outlook figures included in this release exclude the effects of
special items, future changes in regulation, the impact of unforeseen
litigation or unforeseen events or circumstances that reduce vessel deployment
or rates, any changes in operating or capital plans, and any future
acquisitions, divestitures, buybacks or other similar business transactions.
For purposes of this outlook section, EBITDA means earnings before interest,
taxes, depreciation and amortization. See “Caution concerning forward-looking
statements” below.

Conference Call

In connection with this earnings release, management will host an earnings
conference call on Thursday, August 1, 2013, at 10:00 AM ET. To participate in
the conference call, please dial (888) 455-2296 (domestic) or (719) 325-2435
(international). Participants can reference the International Shipholding
Corporation Second Quarter 2013 Earnings Call or passcode 3208673. Please dial
in approximately 5 minutes prior to the call.

The conference call will also be available via a live listen-only webcast and
can be accessed through the Investor Relations section of the Company’s
website, www.intship.com. Please allow extra time prior to the call to visit
the Company’s website and download any software that may be needed to listen
to the webcast.

A replay of the conference call will be available through August 9, 2013, at
(877) 870-5176 (domestic) or (858) 384-5517 (international). The passcode for
the replay is 3208673.

About International Shipholding

International Shipholding Corporation, through its subsidiaries, operates a
diversified fleet of U.S. and International flag vessels that provide
worldwide and domestic maritime transportation services to commercial and
governmental customers primarily under medium to long-term charters and
contracts. www.intship.com

Caution concerning forward-looking statements

Except for the historical and factual information contained herein, the
matters set forth in this release, including statements regarding our 2013
guidance, the expected benefits of the UOS acquisition and other statements
identified by words such as “estimates,” “expects,” “anticipates,” “plans,”
and similar expressions, are forward-looking statements within the meaning of
the “safe harbor” provisions of the Private Securities Litigation Reform Act
of 1995. These forward-looking statements are based on current expectations
only, and are subject to a number of risks and uncertainties, many of which
are beyond our control. Actual events and results may differ materially from
those anticipated, estimated, projected, expressed or implied if one or more
of these risks or uncertainties materialize, or if underlying assumptions
prove incorrect. Factors that could affect actual results include, but are not
limited to: our ability to maximize the usage of our newly-purchased and
incumbent vessels and other assets on favorable economic terms, including our
ability to renew our time charters and contracts when they expire and to
maximize our carriage of supplemental cargoes; our ability to effectively
handle our leverage by servicing and complying with each of our debt
instruments; changes in domestic or international transportation markets that
reduce the demand for shipping generally or for our vessels in particular;
industry-wide changes in cargo freight rates, charter rates, vessel design,
vessel utilization or vessel valuations, or in charter hire, fuel or other
operating expenses; the possibility that the anticipated benefits from the UOS
acquisition cannot be fully realized or may take longer to realize than
expected; political events in the United States and abroad; the appropriation
of funds by the U.S. Congress, including the impact of any future cuts to
federal spending similar to the U.S. Congress’ recent “sequestration” cuts;
terrorism, piracy and trade restrictions; changes in foreign currency rates or
interest rates; the effects of more general factors, such as changes in tax
laws or rates, or in general market, labor or economic conditions; and each of
the other economic, competitive, governmental, and technological factors
detailed in our reports filed with the Securities and Exchange Commission. You
should be aware that new factors may emerge from time to time and it is not
possible for us to identify all such factors nor can we predict the impact of
each such factors on our business or the extent to which any one or more
factors may cause actual results to differ from those reflected in any
forward-looking statements. Accordingly, you are cautioned not to place undue
reliance upon any of our forward-looking statements, which speak only as of
the date made. We undertake no obligation to update or revise, for any reason,
any forward-looking statements made by us or on our behalf, whether as a
result of new information, future events or developments, changed
circumstances or otherwise.

                                                                           
                                                                                          
Non-GAAP Reconciliation Statement
(By Segment)


                                                                                          
(All Amounts                  Pure Car
in Millions)
                   Jones      Truck        Dry        Rail-      Specialty     Other      Total
                   Act        Carriers     Bulk       Ferry      Contracts
                                                                                          
Second
Quarter, 2013
Gross Profit       $4.3       $2.5         ($1.2)     $1.3       $0.5          $0.1       $7.5
                                                                                          
Allocated          ($2.6)     ($2.1)       ($0.2)     ($0.8)     ($0.5)        ($0.0)     ($6.2)
Overhead
*Add Back:
Unconsolidated     $0.0     $0.0       $0.0     $0.1     $0.0        $0.0     $0.1
Entities
Operating          $1.7     $0.4       ($1.4)   $0.6     $0.0        $0.1     $1.4
Income
                                                                                          
                                                                                          
Second
Quarter, 2012
Gross profit       $0.8       $4.2         $1.3       $0.8       $0.8          $0.3       $8.2
                                                                                          
Allocated          ($0.4)     ($2.3)       ($1.0)     ($0.5)     ($0.4)        ($0.1)     ($4.7)
Overhead
Gain on Sale       $0.0       $0.7         $0.0       $0.0       $0.0          $0.0       $0.7
of Assets
*Add Back:
Unconsolidated     $0.0     $0.0       $0.0     ($0.7)   $0.0        $0.0     ($0.7)
Entities
Operating          $0.4     $2.6       $0.3     ($0.4)   $0.4        $0.2     $3.5
Income
                                                                                          
                                                                                          
* To remove the effect of including the results of the unconsolidated
entities in Gross Voyage Profit
                                                                                          
                                                                                          



INTERNATIONAL SHIPHOLDING CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(All Amounts in Thousands Except Share Data)
(Unaudited)

                   Three Months Ended June 30,          Six Months Ended June 30,
                       2013             2012                2013             2012
Revenues               $ 74,897            $ 60,320            $ 156,021           $ 125,524
                                                                                   
Operating
Expenses:
Voyage                   61,508              47,026              131,099             97,852
Expenses
Vessel                   5,804               5,723               11,575              12,080
Depreciation
Other                    11                  -                   34                  -
Depreciation
Administrative
and General              6,170               4,720               11,603              10,228
Expenses
Gain on Sale
of Other                -                 (667      )        -                 (4,466    )
Assets
                                                                                   
Total
Operating               73,493            56,802            154,311           115,694   
Expenses
                                                                                   
Operating               1,404             3,518             1,710             9,830     
Income
                                                                                   
Interest and
Other:
Interest                 2,077               2,281               4,278               5,008
Expense
Derivative               (205      )         117                 (282      )         (32       )
(Gain)/Loss
Gain on Sale             -                   (24       )         -                   (66       )
of Investment
Other Income
from Vessel              (539      )         (605      )         (1,094    )         (1,227    )
Financing
Investment               (42       )         (146      )         (82       )         (274      )
Income
Foreign
Exchange                (1,836    )        1,734             (5,017    )        (1,914    )
(Gain) /Loss
                        (545      )        3,357             (2,197    )        1,495     
                                                                                   
                                                                                   
Income Before
Provision for
Income Taxes
and
Equity in
(Loss) Income
of                      1,949             161               3,907             8,335     
Unconsolidated
Entities
                                                                                   
Provision for
Income Taxes:
Current                 15                108               50                276       
                        15                108               50                276       
                                                                                   
Equity in Net
(Loss) Income
of
Unconsolidated
Entities (Net
of Applicable           (75       )        651               (345      )        581       
Taxes)
                                                                                   
Net Income             $ 1,859            $ 704              $ 3,512            $ 8,640     
                                                                                   
Preferred
Stock                   594               -                 845               -         
Dividends
                                                                                   
Net Income
Available to           $ 1,265            $ 704              $ 2,667            $ 8,640     
Common
Stockholders
                                                                                   
Basic and
Diluted
Earnings Per
Common Share:
Basic Earnings
Per Common             $ 0.17             $ 0.10             $ 0.37             $ 1.20      
Share:
Diluted
Earnings Per           $ 0.17             $ 0.10             $ 0.37             $ 1.20      
Common Share:
                                                                                   
Weighted
Average Shares
of Common
Stock
Outstanding:
Basic                    7,239,780           7,203,860           7,226,415           7,187,236
Diluted                  7,263,206           7,234,505           7,248,377           7,202,559
                                                                                   
Common Stock
Dividends Per          $ 0.250             $ 0.250             $ 0.500             $ 0.500
Share
                                                                                   
                                                                                   



INTERNATIONAL SHIPHOLDING CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(All Amounts in Thousands Except Shares)
(Unaudited)

                                            June 30,        December 31,
ASSETS                                         2013               2012
                                                                    
                                                                    
Cash and Cash Equivalents                      $ 22,386           $ 19,868
Restricted Cash                                  17,825             8,000
Accounts Receivable, Net of Allowance            32,289             32,891
for Doubtful Accounts
of $88 and $100 in 2013 and 2012,                                   
Respectively
Net Investment in Direct Financing               -                  3,540
Leases
Other Current Assets                             7,055              8,392
Notes Receivable                                 4,248              4,383
Material and Supplies Inventory                  9,986             11,847   
Total Current Assets                             93,789            88,921   
                                                                    
Investment in Unconsolidated Entities            13,358            12,676   
                                                                    
Net Investment in Direct Financing               -                 13,461   
Leases
                                                                    
Vessels, Property, and Other Equipment,
at Cost:
Vessels                                          546,691            525,172
Building                                         1,211              1,211
Land                                             623                623
Leasehold Improvements                           26,348             26,348
Construction in Progress                         2,842              10
Furniture and Equipment                          11,564            11,614   
                                                 589,279            564,978
Less - Accumulated Depreciation                  (163,976 )         (151,318 )
                                                 425,303           413,660  
                                                                    
Other Assets:
Deferred Charges, Net of Accumulated             25,907             19,892
Amortization
of $15,060 and $15,821 in 2013 and 2012,                            
Respectively
Intangible Assets, Net of Accumulated            42,636             45,784
Amortization
Due from Related Parties                         1,717              1,709
Notes Receivable                                 29,522             33,381
Goodwill                                         2,771              2,700
Other                                            6,334             5,509    
                                                 108,887           108,975  
                                                                    
TOTAL ASSETS                                   $ 641,337         $ 637,693  
                                                                    
                                                                    



INTERNATIONAL SHIPHOLDING CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(All Amounts in Thousands Except Shares)
(Unaudited)

                                             June 30,       December 31,
                                                2013              2012
LIABILITIES AND STOCKHOLDERS' EQUITY
                                                                     
Current Liabilities:
Current Maturities of Long-Term Debt            $ 25,549          $  26,040
Accounts Payable and Accrued Liabilities          52,743            50,896  
Total Current Liabilities                         78,292            76,936  
                                                                     
Long-Term Debt, Less Current Maturities           187,225           211,590 
                                                                     
Other Long-Term Liabilities:
Lease Incentive Obligation                        5,774              6,150
Other                                             82,152            80,718  
                                                                     
TOTAL LIABILITIES                                 353,443           375,394 
                                                                     
Stockholders' Equity:
Preferred Stock, $1.00 Par Value, 9.50%
Series A Cumulative Perpetual Preferred           250                -
Stock,
650,000 shares Authorized, 250,000 shares                            
Issued and Outstanding at June 30, 2013
Common Stock, $1.00 Par Value, 20,000,000
shares Authorized,                                8,652              8,632
7,248,350 and 7,203,935 shares
Outstanding at June 30, 2013 and                                     
December 31, 2012, Respectively
Additional Paid-In Capital                        109,919            86,362
Retained Earnings                                 217,046            217,654
Treasury Stock, 1,388,066 Shares at both
June 30, 2013 and                                 (25,403 )          (25,403 )
December 31, 2012, Respectively
Accumulated Other Comprehensive Loss              (22,570 )          (24,946 )
TOTAL STOCKHOLDERS' EQUITY                        287,894           262,299 
                                                                     
TOTAL LIABILITIES AND STOCKHOLDERS'             $ 641,337        $  637,693 
EQUITY
                                                                     
                                                                     



INTERNATIONAL SHIPHOLDING CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(All Amounts in Thousands)
(Unaudited)
                                                          
                                                Six Months Ended June 30,
                                                2013              2012
                                                                  
Cash Flows from Operating Activities:
Net Income                                      $ 3,512           $ 8,640
Adjustments to Reconcile Net Income to
Net Cash Provided by
Operating Activities:
Depreciation                                      11,899            12,357
Amortization of Deferred Charges                  4,239             3,926
Amortization of Intangible Assets                 3,148             1,288
Non-Cash Share Based Compensation                 721               544
Equity in Net Loss (Income) of                    345               (581     )
Unconsolidated Entities
Gain on Sale of Assets                            -                 (4,466   )
Gain on Sale of Investments                       -                 (66      )
Gain on Foreign Currency Exchange                 (5,017  )         (1,914   )
Changes in:
Deferred Drydocking Charges                       (6,584  )         (7,623   )
Accounts Receivable                               (1,774  )         277
Inventories and Other Current Assets              3,852             (624     )
Other Assets                                      301               1,950
Accounts Payable and Accrued                      641               (594     )
Liabilities
Other Long-Term Liabilities                      4,511           (3,204   )
Net Cash Provided by Operating                   19,794          9,910    
Activities
                                                                  
Cash Flows from Investing Activities:
Principal payments received under                 558               2,279
Direct Financing Leases
Capital Improvements to Vessels and               (7,518  )         (46,103  )
Other Assets
Proceeds from Sale of Assets                      -                 130,315
Purchase from Sale of Marketable                  -                 (5       )
Securities
Proceeds of Marketable Securities                 -                 159
Investment in Unconsolidated Entities             (500    )         (750     )
Net (Increase) Decrease in Restricted             (9,825  )         6,907
Cash Account
Acquisition of United Ocean Services,             (2,475  )         -
LLC
Proceeds from Note Receivables                   3,657           2,507    
Net Cash (Used In) Provided by                   (16,103 )        95,309   
Investing Activities
                                                                  
Cash Flows from Financing Activities:
Issuance of Preferred Stock                       23,480            -
Proceeds from Issuance of Debt                    22,000            41,175
Repayment of Debt                                 (41,840 )         (141,559 )
Additions to Deferred Financing Charges           (693    )         (264     )
Dividends Paid                                    (4,120  )         (4,805   )
Reimbursements for Leasehold                     -               -        
Improvements
Net Cash Used In Financing Activities            (1,173  )        (105,453 )
                                                                  
Net Increase (Decrease) in Cash and               2,518             (234     )
Cash Equivalents
Cash and Cash Equivalents at Beginning           19,868          21,437   
of Period
                                                                  
                                                                  
Cash and Cash Equivalents at End of             $ 22,386         $ 21,203   
Period
                                                                             
                                                                             

Contact:

The IGB Group
Leon Berman, 212-477-8438
lberman@igbir.com
or
International Shipholding Corporation
Niels M. Johnsen, 212-943-4141
Chairman
or
Erik L. Johnsen, 251-243-9221
President
 
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