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TheStreet Open House

International Shipholding Corporation Reports Second Quarter 2013 Results

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 in Millions)

Jones Act

Pure Car Truck Carriers

Dry Bulk Carriers

Rail-Ferry

Specialty Contracts

Other

Total

 

Second Quarter 2013

                       
Gross Voyage Profit $5.5 $4.6 $0.4 $1.7 $1.0 $0.1 $13.3
 
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 Profit $1.1 $6.8 $2.9 $1.5 $1.3 $0.3 $13.9
 
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 Profit $4.4 ($2.2) ($2.5) $0.2 ($0.3) ($0.2) ($0.6)
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.

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