International Shipholding Corporation Reports Fourth Quarter and Year-End 2013 Results

  International Shipholding Corporation Reports Fourth Quarter and Year-End
  2013 Results

 Declares fourth quarter dividend of $0.25 per share and sets $1.00 dividend
                               target for 2014

           Provides 2014 guidance for EBITDA of $65 to $72 million

Business Wire

MOBILE, Ala. -- January 29, 2014

International Shipholding Corporation (NYSE:ISH) today announced financial
results for the quarter ended December 31, 2013.

Fourth Quarter 2013 Highlights

  *Reported net income of $16.9 million for the three months ended December
    31, 2013, which included a non-cash foreign currency exchange gain of $1.4
    million and a non-cash gain of $14.0 million on the reversal of the
    Company’s tax valuation allowance
  *Concluded a multi year extension of its contract with The Mosaic Company
  *Invested in a Joint Venture to own 30% of two International flag Chemical
    Tankers scheduled for delivery in the first quarter of 2014
  *Entered into a time charter on its Capesize Bulk Carrier through 2014.
  *Fixed the currency risk of its Yen-denominated loan facility at an
    exchange rate of 102.53 per US Dollar

Net Income

The Company reported net income of $16.9 million for the fourth quarter of
2013, which included non-operating gains of $1.4 million from fixing its
Yen-denominated loan facility and $14.0 million from the reversal of the
Company’s Federal tax valuation allowance. Excluding these non-operating
items, net income for the fourth quarter was $1.5 million as compared to a
2012 fourth quarter loss, excluding non-operating items, of $5.4 million.

Mr. Niels M. Johnsen, Chairman and Chief Executive Officer, stated, “In 2013,
we have made significant progress in strengthening our balance sheet,
identifying attractive opportunities to solidify our leadership position in
the niche segments in which we operate, and securing our strong and stable
cash flows from medium to long-term contracts with high-quality
counterparties. We successfully accessed the capital markets twice in 2013,
raising a total of $56.6 million through two preferred stock offerings. This
new capital enabled us to reactivate a Jones Act tug/barge unit, acquire the
contract for a newbuilding 'eco' Handysize Bulkcarrier, and invest in a joint
venture for two Chemical Tankers. Finally, we have continued to sign and renew
medium to long-term contracts with creditworthy counterparties like The Mosaic
Company, with whom we have reached a multi year extension of the contract,
maintaining our strong contract coverage.

“Moving into 2014, we remain committed to using the strong and predictable
cash flows generated by our medium to long-term charters to capitalize on
attractive acquisition opportunities if and as they arise in niche markets,
which ultimately creates value for our shareholders. It is in line with this
dedication to value creation for our shareholders that our Board of Directors
declared a $0.25 per share dividend for the fourth quarter of 2013, thereby
achieving our target of $1.00 per share for the full year 2013.”

Gross Voyage Profit

The Company’s fourth quarter 2013 gross voyage profit, representing the
results of its six reporting segments, was $17.9 million, compared to $10.7
million in the comparable 2012 three month period. The comparable results by
operating segment are shown below.

(All Amounts             Pure Car  Dry Bulk              Specialty        
in Millions)
                  Jones     Truck      Carriers   Rail-Ferry   Contracts   Other   Total
                  Act       Carriers
Fourth
Quarter, 2013
Gross Voyage      $ 9.1     $  3.2     $  1.8     $   1.5      $  1.6      $ 0.7   $ 17.9
Profit
                                                                                     
Depreciation       (1.9)     (2.2)     (1.6)      (0.5)      (0.5)     -      (6.7)
Gross Profit      $ 7.2     $  1.0     $  0.2     $   1.0      $  1.1      $ 0.7   $ 11.2
(After
Depreciation)
                                                                                     
Fourth,
Quarter, 2012
Gross Voyage      $ 4.0     $  4.6     $  0.7     $   0.6      $  0.3      $ 0.5   $ 10.7
Profit
                                                                                     
Depreciation       (0.9)     (2.4)     (1.7)      (0.7)      (0.5)     -      (6.2)
Gross Profit      $ 3.1     $  2.2     $  (1.0)   $   (0.1)    $  (0.2)    $ 0.5   $ 4.5
(Loss)
(After
Depreciation)
                                                                                     
Variance
Gross Voyage      $ 5.1     $  (1.4)   $  1.1     $   0.9      $  1.3      $ 0.2   $ 7.2
Profit
Depreciation      $ (1.0)   $  0.2     $  0.1     $   0.2      $  -        $ -     $ (0.5)
Gross Profit      $ 4.1     $  (1.2)   $  1.2     $   1.1      $  1.3      $ 0.2   $ 6.7
(Loss)

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


The improved gross voyage results on the Jones Act segment are directly
attributable to United Ocean Services (“UOS”), which contributed three full
months of results during the fourth quarter of 2013 as compared to one month
in the comparable quarter of 2012. Partially offsetting the segment’s results
were higher operating cost on the Company’s molten sulphur carrier. Gross
voyage profit on the Pure Car Truck Carrier (“PCTC”) segment was lower
primarily due to the lower charter rate on one of its International flag
PCTCs, which took effect April, 2013, and higher operating costs for the PCTC
fleet. Stronger results in the Dry Bulk segment reflect improvements in Dry
Bulk rates, relative to their levels in the comparable quarter of 2012. During
the fourth quarter, at a point in time that one year term charters were
fixable in the mid to high teens, the Company fixed its Capesize Bulk Carrier
on a time charter through 2014. The Rail Ferry segment continued its recent
trend by reporting higher northbound volumes in the 2013 fourth quarter. The
Company’s Specialty segment reported improved results over the 2012 fourth
quarter, primarily related to revenue contributions from its ice-strengthened
vessel. This vessel redelivered from a charter during the fourth quarter of
2012 and experienced non-operating days in that quarter, but was fully
employed during the fourth quarter of 2013. The Other segment, which consists
primarily of chartering brokerage and agency services, had slightly lower
brokerage revenues than in the comparable 2012 period.

Administrative and General

Administrative and general expenses were approximately $1.2 million lower for
the quarter ended December 31, 2013 compared to the same period in 2012. The
2012 period included professional fees associated with the acquisition of UOS
in November, 2012. The absence of those fees during the 2013 quarter was
partially offset by the incremental overhead related to a full fourth quarter
of UOS operations in 2013.

Interest and Other

The lower interest expense for the fourth quarter of 2013 reflects the
Company’s lower outstanding debt service relative to the comparable 2012
period. During the fourth quarter of 2013, the Company entered into forward
Yen exchange contracts which fixed the Company’s Yen exposure at approximately
102.53 Yen to the U.S. Dollar. While the facility remains a Yen-denominated
loan, future Yen currency fluctuations will have no impact on the Company’s
earnings. The Company recognized a non-cash gain of $1.4 million related to
the Yen-denominated facility in the fourth quarter of 2013.

Taxes

With the acquisition of UOS and taking into consideration the projected
taxable earnings from the Jones Act segment in future periods, the Company
reversed and recognized in its earnings a Federal tax valuation allowance of
$14.0 million in the 2013 fourth quarter results.

Balance Sheet

The Company’s working capital at December 31, 2013 was $14.2 million, a
decrease of $1.7 million from September 30, 2013. The decrease was due in part
to investment in the Chemical Tanker joint venture. Cash and cash equivalents
balance was approximately $20 million. Capital expenditures for the 2013
fiscal year were $50.7 million, which includes drydock expenditures of $18.2
million. The Company’s total debt obligations at December 31, 2013 were
approximately $198 million.

Dividend Declarations

The Company’s Board of Directors approved per-share dividend payments on
January 7, 2014 of $2.375 and $2.25 on its Series A and Series B Preferred
Stock, respectively, representing regular quarterly payments. Additionally,
the Board of Directors declared a $0.25 dividend payable on March 3, 2014 for
each share of common stock owned on the record date of February 17, 2014. All
future dividend declarations remain subject to the discretion of International
Shipholding Corporation’s Board of Directors.

Outlook

The Company projects 2014 EBITDA in the range of $65 and $72 million and
estimates that its 2014 cash outlay on capital expenditures, including drydock
costs, will be within a $13 - $16 million range. The Company set a $1.00
common stock dividend target for the 2014 fiscal year.

All 2014 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. Dividends are payable only if and when declared by our
board of directors, which remains free to change or terminate our dividend
practices at any time.

Conference Call

In connection with this earnings release, management will host an earnings
conference call on Thursday, January 30, 2014, at 10:00 AM ET. To participate
in the conference call, please dial (888) 329-8877 (domestic) or (719)
457-2664 (international). Participants can reference the International
Shipholding Corporation Fourth Quarter 2013 Earnings Call or passcode 1520028.
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 February 6, 2014 at
(877) 870-5176 (domestic) or (858) 384-5517 (international). The passcode for
the replay is 1520028.

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 historical and factual information, the matters set forth in this
release and future oral or written statements made by us or our management,
including statements regarding our 2014 guidance, 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 assumptions, 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
by us if one or more of these risks or uncertainties materialize, or if our
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, including charges in the rates at which competitors
add or scrap vessels; 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; 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 in pension or benefits costs, 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 are inherently speculative and
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 by Segment
Quarter ended December 31, 2013
                                                                            
(All Amounts                 Pure Car
in Millions)                                                   Specialty
                   Jones     Truck      Dry
                   Act                  Bulk      Rail-Ferry   Contracts   Other     Total
                             Carriers
Fourth
Quarter, 2013
Gross Profit       $ 7.2     $  1.0     $ 0.2     $   1.0      $  1.1      $ 0.7     $ 11.2
                                                                                       
Allocated            (3.1)      (1.1)     (0.6)       (0.5)       (0.6)      (0.2)     (6.1)
Overhead
*Add Back:
Unconsolidated      -         -        0.9        -          -         -        0.9
Entities
Operating          $ 4.1     $  (0.1)   $ 0.5     $   0.5      $  0.5      $ 0.5     $ 6.0
Income
                                                                                       
Fourth
Quarter, 2012
Gross profit       $ 3.1     $  2.2     $ (1.0)   $   (0.1)    $  (0.2)    $ 0.5     $ 4.5
                                                                                       
Allocated            (0.6)      (3.0)     (1.7)       (0.5)       (1.0)      (0.7)     (7.4)
Overhead
Gain on Sale         -          12.2      -           -           -          -         12.2
of Assets
*Add Back:
Unconsolidated      -         -        0.8        -          -         -        0.8
Entities
Operating          $ 2.5     $  11.4    $ (1.9)   $   (0.6)    $  (1.2)    $ (0.2)   $ 10.1
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          Twelve Months Ended
                        December 31,                  December 31,
                        2013         2012            2013         2012
Revenues                $ 76,193      $ 56,810        $ 310,152     $ 243,496
Operating Expenses:
Voyage Expenses           56,363        44,433          247,622       185,453
Amortization              1,029         829             5,701         3,055
Expense
Vessel Depreciation       6,658         6,186           24,363        24,366
Other Depreciation        18            23              69            32
Administrative and        6,137         7,373           22,734        23,244
General Expenses
Loss/(Gain) on Sale      10           (12,162)       16           (16,625)
of Other Assets
Total Operating          70,215       46,682         300,505      219,525
Expenses
Operating Income         5,978        10,128         9,647        23,971
Interest and Other:
Interest Expense          2,117         3,257           9,504         10,409
Derivative Loss           (48)          388             438           485
(Gain)
(Gain)/Loss on Sale       -             (514)           -             (580)
of Investment
Other Income from         (506)         (572)           (2,122)       (2,387)
Vessel Financing
Investment Income         (23)          (79)            (114)         (470)
Foreign Exchange         (1,354)      (4,735)        (5,914)      (5,506)
(Gain)/Loss
                         186          (2,255)        1,792        1,951
Income Before
Provision (Benefit)
for Income Taxes
and Equity in Net
Loss of                  5,792        12,383         7,855        22,020
Unconsolidated
Entities
Provision/(Benefit)
for Income Taxes:
Current                   15            16              83            296
Deferred                  (12,299)      (53)            (12,299)      (453)
State                    253          -              253          -
                         (12,031)     (37)           (11,963)     (157)
Equity in Net Loss
of Unconsolidated
Entities (Net of         (955)        (880)          (1,661)      (215)
Applicable Taxes)
Net Income              $ 16,868      $ 11,540        $ 18,157      $ 21,962
Preferred Stock          1,306        -              3,226        -
Dividends
Net Income
Available to Common     $ 15,562      $ 11,540        $ 14,931      $ 21,962
Stockholders
Basic and Diluted
Earnings Per Common
Share:
Basic Earnings Per      $ 2.15        $ 1.60          $ 2.06        $ 3.05
Common Share:
Diluted Earnings        $ 2.13        $ 1.60          $ 2.05        $ 3.04
Per Common Share:
Weighted Average
Shares of Common
Stock Outstanding:
Basic                     7,248,350     7,203,911       7,237,472     7,195,606
Diluted                   7,322,082     7,226,436       7,282,677     7,213,288
Common Stock            $ 0.25        $ 0.25          $ 1.00        $ 1.00
Dividends Per Share



INTERNATIONAL SHIPHOLDING CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(All Amounts in Thousands Except Shares)
Unaudited
                                              December 31,   December 31,
ASSETS                                           2013             2012
                                                                     
Cash and Cash Equivalents                        $  20,010        $  19,868
Restricted Cash                                     8,499            8,000
Accounts Receivable, Net of Allowance for           30,441           32,891
Doubtful Accounts
Net Investment in Direct Financing Leases           -                3,540
Other Current Assets                                10,430           8,392
Notes Receivable                                    3,987            4,383
Material and Supplies Inventory                    11,286          11,847
Total Current Assets                               84,653          88,921
                                                                     
Investment in Unconsolidated Entities              14,818          12,676
                                                                     
Net Investment in Direct Financing Leases          -               13,461
                                                                     
Vessels, Property, and Other Equipment, at
Cost:
Vessels                                             582,416          525,172
Building                                            1,211            1,211
Land                                                623              623
Leasehold Improvements                              26,348           26,348
Construction in Progress                            2,673            10
Furniture and Equipment                            11,727          11,614
                                                    624,998          564,978
Less - Accumulated Depreciation                    (175,106)       (151,318)
                                                   449,892         413,660
                                                                     
Other Assets:
Deferred Charges, Net of Accumulated                29,309           19,892
Amortization
Intangible Assets, Net of Accumulated               28,756           45,784
Amortization
Due from Related Parties                            1,699            1,709
Notes Receivable                                    27,659           33,381
Goodwill                                            2,735            2,700
Deferred Tax Asset                                  9,471            -
Other                                              7,383           5,509
                                                   107,012         108,975
                                                                     
TOTAL ASSETS                                     $  656,375       $  637,693



INTERNATIONAL SHIPHOLDING CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(All Amounts in Thousands Except Shares)
Unaudited
                                                            
                                                 December 31,     December 31,
                                                 2013             2012
LIABILITIES AND STOCKHOLDERS' EQUITY
                                                                     
Current Liabilities:
Current Maturities of Long-Term Debt             $  19,213        $  26,040
Accounts Payable and Accrued Liabilities           51,278         50,896  
Total Current Liabilities                          70,491         76,936  
                                                                     
Long-Term Debt, Less Current Maturities            179,016        211,590 
                                                                     
Other Long-Term Liabilities:
Lease Incentive Obligation                          5,397            6,150
Other                                              65,306         80,718  
                                                                     
TOTAL LIABILITIES                                  320,210        375,394 
                                                                     
Stockholders' Equity:
Preferred Stock – Series A                          250              -
Preferred Stock – Series B                          316              -
Common Stock                                        8,692            8,632
Additional Paid-In Capital                          140,115          86,362
Retained Earnings                                   226,105          217,654
Treasury Stock                                      (25,403 )        (25,403 )
Accumulated Other Comprehensive Loss               (13,910 )       (24,946 )
TOTAL STOCKHOLDERS' EQUITY                         336,165        262,299 
                                                                     
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY       $  656,375      $  637,693 



INTERNATIONAL SHIPHOLDING CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(All Amounts in Thousands)
Unaudited
                                           Twelve Months Ended December 31,
                                              2013             2012
Cash Flows from Operating Activities:
Net Income                                    $  18,157          $  21,962
Adjustments to Reconcile Net Income to
Net Cash Provided by
Operating Activities:
Depreciation                                     24,930             24,975
Amortization of Deferred Charges                 11,638             7,979
Amortization of Intangible Assets                5,698              3,055
Deferred Tax Benefit                             (12,046)           (453)
Non-Cash Share Based Compensation                1,420              1,216
Equity in Net (Loss) Income of                   1,661              215
Unconsolidated Entities
Loss (Gain) on Sale of Assets                    16                 (16,625)
Gain on Sale of Investments                      -                  (580)
Gain on Foreign Currency Exchange                (5,914)            (5,506)
Changes in:
Deferred Drydocking Charges                      (18,176)           (11,304)
Accounts Receivable                              2,014              (3,533)
Inventories and Other Current Assets             (767)              (2,734)
Other Assets                                     840                2,121
Accounts Payable and Accrued                     (9,380)            (6,481)
Liabilities
Other Long-Term Liabilities                     3,782             (4,473)
Net Cash Provided by Operating                  23,873            9,834
Activities
                                                                    
Cash Flows from Investing Activities:
Principal payments received under                558                3,877
Direct Financing Leases
Acquisition of Frascati Shops Inc and            -                  (620)
Tower, LLC
Capital Improvements to Vessels and              (32,543)           (50,729)
Other Assets
Proceeds from Sale of Assets                     -                  225,315
Proceeds of Marketable Securities                -                  12,433
Investment in Unconsolidated Entities            (3,520)            (1,000)
Net Increase in Restricted Cash Account          (499)              (1,093)
Acquisition of United Ocean Services,            (2,475)            (112,242)
LLC
Proceeds from Note Receivables                  5,954             4,754
Net Cash (Used In) Provided by                  (32,525)          80,695
Investing Activities
                                                                    
Cash Flows from Financing Activities:
Issuance of Preferred Stock                      53,333             -
Proceeds from Issuance of Debt                   67,000             137,930
Repayment of Debt                                (99,711)           (220,337)
Additions to Deferred Financing Charges          (2,122)            (1,274)
Dividends Paid                                  (9,706)           (8,417)
Net Cash Provided by (Used In)                  8,794             (92,098)
Financing Activities
                                                                    
Net Increase (Decrease) in Cash and              142                (1,569)
Cash Equivalents
Cash and Cash Equivalents at Beginning          19,868            21,437
of Period
                                                                    
Cash and Cash Equivalents at End of           $  20,010          $  19,868
Period
                                                                    

Contact:

The IGB Group
Bryan Degnan, 646-673-9701
bdegnan@igbir.com
or
Leon Berman, 212-477-8438
lberman@igbir.com
or
International Shipholding Corporation
Niels M. Johnsen, Chairman, 212-943-4141
Erik L. Johnsen, President, 251-243-9221
Manny Estrada, V. P. and CFO, 251-243-9082
 
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