<PAGE>1
INTERNATIONAL SHIPHOLDING CORPORATION AND SUBSIDIARIES
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2000
------------------
__ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
----------- -----------
Commission file number 2-63322
---------------------------------------
INTERNATIONAL SHIPHOLDING CORPORATION
- -------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 36-2989662
- ------------------------------- ---------------------------------------
(State or other jurisdiction of (I.R.S. Employer Identification Number)
incorporation or organization)
650 Poydras Street New Orleans, Louisiana 70130
- ----------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
(504) 529-5461
- ----------------------------------------------------------------------------
(Registrant's telephone number, including area code)
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of
the Securities Exchange Act of 1934 during the preceding 12
months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to
such filing for the past 90 days. YES X NO
-------- ---------
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest
practicable date.
Common Stock $1 Par Value 6,082,887 shares (March 31, 2000)
-------------------------
<PAGE>2
<TABLE>
PART I - FINANCIAL INFORMATION
ITEM 1-FINANCIAL STATEMENTS
INTERNATIONAL SHIPHOLDING CORPORATION
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
(All Amounts in Thousands Except Share Data)
(Unaudited)
<CAPTION>
Three Months Ended March 31,
2000 1999
------------ ------------
<S> <C> <C>
Revenues $ 85,349 $ 84,789
Subsidy Revenue 3,675 3,640
------------ ------------
89,024 88,429
------------ ------------
Operating Expenses:
Voyage Expenses 69,907 66,209
Vessel and Barge Depreciation 9,942 9,642
------------ ------------
Gross Voyage Profit 9,175 12,578
------------ ------------
Administrative and General Expenses 5,706 6,014
Gain on Sale of Land - 2,408
------------ ------------
Operating Income 3,469 8,972
------------ ------------
Interest:
Interest Expense 8,524 7,569
Investment Income (259) (375)
------------ ------------
8,265 7,194
------------ ------------
(Loss) Income Before (Benefit)
Provision for Income Taxes and Equity
in Net Loss of Unconsolidated Entities (4,796) 1,778
------------ ------------
(Benefit) Provision for Income Taxes:
Current 649 450
Deferred (2,275) 181
State 84 124
------------ ------------
(1,542) 755
------------ ------------
Equity in Net Loss of Unconsolidated
Entities (Net of Applicable Taxes) (45) -
------------ ------------
Net (Loss) Income $ (3,299) $ 1,023
============ ============
Basic and Diluted Earnings Per
Share:
Net (Loss) Income $ (0.54) $ 0.16
============ ============
<FN>
The accompanying notes are an integral part of these statements.
</TABLE>
<PAGE>3
<TABLE>
INTERNATIONAL SHIPHOLDING CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS
(All Amounts in Thousands)
(Unaudited)
<CAPTION>
March 31, December 31,
ASSETS 2000 1999
------------ ------------
<S> <C> <C>
Current Assets:
Cash and Cash Equivalents $ 23,963 $ 18,661
Marketable Securities 10,474 11,337
Accounts Receivable, Net of
Allowance for Doubtful
Accounts of $413 and $294 in
2000 and 1999, Respectively:
Traffic 39,843 47,855
Agents' 5,236 6,660
Claims and Other 11,857 7,174
Federal Income Taxes Receivable 7 583
Deferred Income Taxes 60 60
Net Investment in Direct Financing
Leases 3,377 3,137
Other Current Assets 4,305 4,134
Material and Supplies Inventory,
at Lower of Cost or Market 12,932 12,726
------------ ------------
Total Current Assets 112,054 112,327
------------ ------------
Marketable Equity Securities 195 234
------------ ------------
Investment in Unconsolidated Entities 2,736 2,805
------------ ------------
Net Investment in Direct Financing Leases 110,744 112,032
------------ ------------
Vessels, Property, and Other Equipment,
at Cost:
Vessels and Barges 775,526 775,001
Other Marine Equipment 7,981 7,897
Terminal Facilities 18,479 18,470
Land 1,230 1,230
Furniture and Equipment 17,247 17,222
------------ ------------
820,463 819,820
Less - Accumulated Depreciation (390,231) (379,588)
------------ ------------
430,232 440,232
------------ ------------
Other Assets:
Deferred Charges, Net of Accumulated
Amortization of $40,582 and $49,880 in
2000 and 1999, Respectively 37,398 39,692
Acquired Contract Costs, Net of Accumulated
Amortization of $15,973 and $15,609
in 2000 and 1999, Respectively 14,552 14,916
Due from Related Parties 561 580
Other 9,657 12,185
------------- ------------
62,168 63,373
------------- ------------
$ 718,129 $ 735,003
============= ============
<FN>
The accompanying notes are an integral part of these statements.
</TABLE>
<PAGE>4
<TABLE>
INTERNATIONAL SHIPHOLDING CORPORATION
CONSOLIDATED CONDENSED BALANCE SHEETS
(All Amounts in Thousands Except Share Data)
(Unaudited)
<CAPTION>
March 31, December 31,
2000 1999
LIABILITIES AND STOCKHOLDERS' ------------ ------------
INVESTMENT
<S> <C> <C>
Current Liabilities:
Current Maturities of Long-Term Debt $ 24,329 $ 23,137
Current Maturities of Capital Lease
Obligations 3,572 3,231
Accounts Payable and Accrued
Liabilities 54,903 50,388
------------ ------------
Total Current Liabilities 82,804 76,756
------------ ------------
Billings in Excess of Income Earned and
Expenses Incurred 3,461 5,083
------------ ------------
Long-Term Capital Lease Obligations, Less
Current Maturities 5,530 8,853
------------ ------------
Long-Term Debt, Less Current Maturities 376,509 391,589
------------ ------------
Other Long-Term Liabilities:
Deferred Income Taxes 42,655 45,124
Claims and Other 28,502 25,114
------------ ------------
71,157 70,238
------------ ------------
Commitments and Contingent Liabilities
Stockholders' Investment:
Common Stock 6,756 6,756
Additional Paid-In Capital 54,450 54,450
Retained Earnings 126,760 130,440
Less - Treasury Stock (8,704) (8,654)
Accumulated Other Comprehensive Loss (594) (508)
------------ ------------
178,668 182,484
------------ ------------
$ 718,129 $ 735,003
============ ============
<FN>
The accompanying notes are an integral part of these statements.
</TABLE>
<PAGE>5
<TABLE>
INTERNATIONAL SHIPHOLDING CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' INVESTMENT
(All Amounts in Thousands)
(Unaudited)
<CAPTION> Accumulated
Additional Other
Common Paid-In Retained Treasury Comprehensive
Stock Capital Earnings Stock Income (Loss) Total
------- -------- --------- -------- ------------ --------
<S> <C> <C> <C> <C> <C> <C>
Balance at
December 31, 1998 $6,756 $54,450 $117,399 ($1,422) ($75) $177,108
Comprehensive Income:
Net Income for
Year Ended
December 31, 1999 - - 14,623 - - 14,623
Other Comprehensive
Income:
Unrealized Holding
Loss on Marketable
Securities,Net of
Deferred Taxes of
($233) - - - - (433) (433)
---------
Total Comprehensive
Income 14,190
Treasury Stock - - - (7,232) - (7,232)
Cash Dividends - - (1,582) - - (1,582)
------- -------- --------- -------- ------------ ---------
Balance at
December 31, 1999 $6,756 $54,450 $130,440 ($8,654) ($508) $182,484
======= ======== ========= ======== ============ =========
Comprehensive Income:
Net Loss for the
Period Ended
March 31, 2000 - - (3,299) - - (3,299)
Other Comprehensive
Income:
Unrealized Holding
Loss on Marketable
Securities, Net of
Deferred Taxes of
($46) - - - - (86) (86)
---------
Total Comprehensive
Income (3,385)
Treasury Stock - - - (50) (50)
Cash Dividends - - (381) - - (381)
------- -------- --------- -------- ------------ ---------
Balance at
March 31, 2000 $6,756 $54,450 $126,760 ($8,704) ($594) $178,668
======= ======== ========= ======== ============ =========
<FN>
The accompanying notes are an integral part of these statements.
</TABLE>
<PAGE>6
<TABLE>
INTERNATIONAL SHIPHOLDING CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
(All Amounts in Thousands)
(Unaudited)
<CAPTION>
For Three Months Ended March 31,
2000 1999
------------ ------------
<S> <C> <C>
Cash Flows from Operating Activities:
Net (Loss) Income $ (3,299) $ 1,023
Adjustments to Reconcile Net (Loss)
Income to Net Cash Provided by
Operating Activities:
Depreciation 10,704 10,491
Amortization of Deferred Charges
and Other Assets 4,905 4,438
(Benefit) Provision for Deferred
Income Taxes (2,275) 181
Equity in Net Loss of Unconsolidated
Entities (45) -
Loss (Gain) on Sale of Vessels
and Other Property 5 (2,405)
Changes in:
Accounts Receivable 5,145 578
Inventories and Other Current Assets (377) 544
Other Assets 2,518 (112)
Accounts Payable and Accrued Liabilities 4,512 (2,727)
Federal Income Taxes Payable 542 137
Unearned Income (1,622) (2,193)
Other Long-Term Liabilities 1,505 733
------------ ------------
Net Cash Provided by Operating Activities 22,218 10,688
------------ ------------
Cash Flows from Investing Activities:
Net Investment in Direct Financing
Lease 1,088 1,920
Purchase of Vessels and Other
Property (897) (1,183)
Additions to Deferred Charges (710) (2,863)
Proceeds from Sale of Vessels and
Other Property 104 3
Purchase of and Proceeds from Short-
Term Investments 781 (1,078)
Other Investing Activities 19 19
------------ -----------
Net Cash Provided (Used) by Investing
Activities 385 (3,182)
------------ -----------
Cash Flows from Financing Activities:
Proceeds from Issuance of Debt 5,000 3,000
Reduction of Debt and Capital Lease
Obligations (21,870) (18,326)
Additions to Deferred Financing Charges - (2)
Purchase of Treasury Stock (50) (2,619)
Common Stock Dividends Paid (381) (406)
------------ -----------
Net Cash Used by Financing Activities (17,301) (18,353)
------------ -----------
Net Increase (Decrease) in Cash and Cash
Equivalents 5,302 (10,847)
Cash and Cash Equivalents at Beginning of
Period 18,661 32,008
----------- -----------
Cash and Cash Equivalents at End of Period $ 23,963 $ 21,161
=========== ===========
<FN>
The accompanying notes are an integral part of these statements.
</TABLE>
<PAGE>7
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
MARCH 31, 2000
(Unaudited)
Note 1. Basis of Preparation
The accompanying unaudited interim financial statements
have been prepared pursuant to the rules and regulations of
the Securities and Exchange Commission. Certain information
and footnote disclosures required by generally accepted
accounting principles for complete financial statements have
been omitted. It is suggested that these interim
statements be read in conjunction with the financial
statements and notes thereto included in the Form 10-K of
International Shipholding Corporation for the year ended
December 31, 1999. Certain reclassifications have been made
to prior period financial information in order to conform to
current year presentations.
Interim statements are subject to possible adjustments
in connection with the annual audit of the Company's
accounts for the full year 2000. In the opinion of
management, all adjustments (consisting of only normal
recurring adjustments) necessary for a fair presentation of
the information shown have been included.
The foregoing 2000 interim results are not necessarily
indicative of the results of operations for the full year
2000.
The Company's policy is to consolidate all subsidiaries
in which it holds greater than 50% voting interest. All
significant intercompany accounts and transactions have been
eliminated.
The Company uses the cost method to account for
investments in entities in which it holds less than 20%
voting interest and in which the Company cannot exercise
significant influence over operating and financial
activities. The Company uses the equity method to account
for investments in entities in which it holds a 20% to 50%
voting interest.
Note 2. Operating Segments
The Company's three operating segments, LINER SERVICES,
TIME CHARTER CONTRACTS, and CONTRACTS OF AFFREIGHTMENT, are
identified primarily based on the characteristics of the
contracts and terms under which its fleet of vessels and
barges are operated. The Company also reports an OTHER
category that includes results of several of the Company's
subsidiaries that provide ship charter brokerage, agency,
barge fleeting and other specialized services primarily to
<PAGE>8
the Company's operating segments described below. Each of
the reportable segments is managed separately as each
requires different resources depending on the nature of the
contract or terms under which each vessel within the segment
operates.
The following table presents information about segment
profit and loss for the three months ended March 31, 2000
and 1999. The Company does not allocate interest income,
administrative and general expenses, equity in
unconsolidated entities, or income taxes to its segments.
Intersegment revenues are based on market prices and include
revenues earned by subsidiaries of the Company that provide
specialized services to the operating segments.
<TABLE>
<CAPTION>
Time
Liner Charter Contracts of
(All Amounts in Thousands) Services Contracts Affreightment Other Total
-------- --------- ------------- ------ ------
<S> <C> <C> <C> <C> <C>
2000
Revenues from external
customers $44,918 $34,313 $ 7,669 $2,124 $89,024
Intersegment revenues - - - 8,994 8,994
Gross voyage profit
before depreciation 858 14,787 3,032 440 19,117
Depreciation 3,825 4,402 1,647 68 9,942
Interest expense 1,418 5,164 1,784 158 8,524
Segment (loss) profit
before interest income,
administrative and
general expenses, equity
in unconsolidated entities
and taxes (4,385) 5,221 (399) 214 651
- ------------------------------------------------------------------------------
1999
Revenues from external
customers $45,450 $31,370 $ 7,804 $2,222 $86,846
Net revenue from contract
settlement - accrual - - 1,583 - 1,583
Intersegment revenues - - - 9,131 9,131
Gross voyage profit
before depreciation 5,146 11,692 4,483 899 22,220
Depreciation 3,552 4,255 1,648 187 9,642
Interest expense 1,469 3,680 2,139 281 7,569
Gain on sale of land - - - 2,408 2,408
Segment profit before
interest income,
administrative and
general expenses and taxes 125 3,757 696 2,839 7,417
- ------------------------------------------------------------------------------
</TABLE>
Following is a reconciliation of the totals reported for the operating
segments to the applicable line items in the consolidated financial statements:
<TABLE>
<CAPTION>
(All Amounts in Thousands) Three Months Ended March 31,
2000 1999
------------ -----------
<S> <C> <C>
Total profit for reportable segments $ 651 $ 7,417
Unallocated amounts:
Interest income 259 375
Administrative and general
expenses 5,706 6,014
----------- -----------
(Loss) income before income taxes and
equity in unconsolidated entities $ (4,796) $ 1,778
=========== ===========
<PAGE>9
Note 3. Subsequent Events
The Company has entered into an agreement, subject to
Maritime Administration approval, to sell one of its smaller
and older Pure Car Carriers ("PCC"), the GREEN BAY, and to
replace it with a larger and newer Pure Car/Truck Carrier
("PCTC"). Upon purchase of the PCTC, the vessel will enter
into a long-term contract with a major Japanese ship
operator.
<PAGE>10
ITEM 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS
Certain statements made in this report or elsewhere by,
or on behalf of, the Company that are not based on
historical facts are intended to be forward-looking
statements within the meaning of the safe harbor provisions
of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements are based on assumptions about
future events and are therefore subject to risks and
uncertainties. The Company cautions readers that certain
important factors have affected and may affect in the future
the Company's actual consolidated results of operations and
may cause future results to differ materially from those
expressed in or implied by any forward-looking statements
made in this report or elsewhere by, or on behalf of, the
Company. A description of certain of these important
factors is contained in the Company's Form 10-K filed with
the Securities and Exchange Commission for the year ended
December 31, 1999.
The Company's vessels are operated under a variety of
charters, liner services, and contracts. The nature of
these arrangements is such that, without a material
variation in gross voyage profits (total revenues less
voyage expenses and vessel and barge depreciation), the
revenues and expenses attributable to a vessel deployed
under one type of charter or contract can differ
substantially from those attributable to the same vessel if
deployed under a different type of charter or contract.
Accordingly, depending on the mix of charters or contracts
in place during a particular accounting period, the
Company's revenues and expenses can fluctuate substantially
from one period to another even though the number of vessels
deployed, the number of voyages completed, the amount of
cargo carried and the gross voyage profit derived from the
vessels remain relatively constant. As a result,
fluctuations in voyage revenues and expenses are not
necessarily indicative of trends in profitability, and
management believes that gross voyage profit is a more
appropriate measure of performance than revenues.
Accordingly, the discussion below addresses variations in
gross voyage profits rather than variations in revenues.
<PAGE>11
FIRST QUARTER ENDED MARCH 31, 2000
COMPARED TO FIRST QUARTER ENDED MARCH 31, 1999
Gross Voyage Profit
- -------------------
Gross voyage profit decreased from $12.6 Million in the
first quarter of 1999 to $9.2 Million in the first quarter
of 2000. The first quarter of 1999 included a pro-rata
accrual for the anticipated receipt of lost profits in
connection with the 1999 termination of a coal
transportation contract as discussed in the Company's
December 31, 1999 Form 10-K. After excluding this accrual
from the first quarter 1999 results, gross voyage profit
decreased in the first quarter of 2000 as compared to the
same period in 1999 by 16.6%. The decrease occurred
primarily in the Company's LINER SERVICES segment, where
gross voyage profit before depreciation decreased 83.3% from
$5.1 Million in the first quarter of 1999 to $0.9 Million
for the first quarter of 2000. The decrease resulted in
part because of the necessity to substitute one of the
segment's LASH vessels, the SAM HOUSTON, for the LASH
vessel, RHINE FOREST, while the latter was in a shipyard for
over 75 days to undergo planned maintenance during the
quarter. Additionally, the cost of bunker fuel has risen
significantly in the past six months. In the first quarter
of 2000, the Company paid $3.7 Million more for fuel for its
LINER SERVICES segment than in the first quarter of 1999.
This increased bunker fuel cost was incurred even though
less voyage days were incurred in the first quarter of 2000
because of the out-of-service time for the RHINE FOREST.
The decrease in gross voyage profit for the LINER
SERVICES segment was partially offset by improved results
for the TIME CHARTER CONTRACTS. The gross voyage profit
before depreciation for the TIME CHARTER CONTRACTS segment
increased 26.5% from $11.7 Million in the first quarter of
1999 to $14.8 Million for the same period in 2000 due to the
acquisition and commencement of operations of the Company's
U.S. Flag PCTC, the GREEN DALE, in September of 1999. In
addition, the Company's PCTC, the ASIAN EMPEROR, that
delivered to the Company and commenced operations in May of
1999, showed improved results over the older and smaller
vessel it replaced.
The CONTRACTS OF AFFREIGHTMENT segment's gross profit
before depreciation and after the aforementioned elimination
of the 1999 first quarter contract termination accrual,
increased 4.6% from $2.9 Million in the first quarter of
1999 to $3.0 Million for the same period in 2000 due to a
slight increase in revenue tons carried.
Vessel and barge depreciation for the first quarter of
2000 increased 3.1% to $9.9 Million as compared to $9.6
Million in the same period of 1999 primarily due to the
commencement of operations of the GREEN DALE as discussed
above.
<PAGE>12
Other Income and Expenses
- -------------------------
Administrative and general expenses decreased from $6.0
Million in the first quarter of 1999 to $5.7 Million in the
same period in 2000 due to a continuing cost reduction
program.
Earnings in 1999 included a gain of $2.4 Million
recognized on the sale of a parcel of land no longer
required in the Company's operations.
Interest expense was $8.5 Million for the first quarter
of 2000 as compared to $7.6 Million for the same period in
1999. The increase resulted primarily from the financing
associated with the acquisition of the ASIAN EMPEROR early
in the second quarter of 1999 and the acquisition of the
GREEN DALE at the end of the third quarter of 1999.
Investment income decreased from $375,000 for the first
quarter of 1999 to $259,000 for the first quarter of 2000
due to a lower average balance of invested funds.
Income Taxes
- ------------
In the first quarter of 2000, the Company had an income
tax benefit of $1.6 Million compared to income tax expense
of $631,000 in the same period in 1999, at the statutory
rate of 35% for both periods.
<PAGE>13
LIQUIDITY AND CAPITAL RESOURCES
The Company's working capital decreased from $35.6
Million at December 31, 1999, to $29.3 Million at March 31,
2000, after provision for current maturities of long-term
debt and capital lease obligations of $27.9 Million. Cash
and cash equivalents increased during the first three months
of 2000 by $5.3 Million to a total of $24.0 Million. This
increase, which resulted from cash provided by operating
activities of $22.2 Million, was partially offset by cash
used for financing activities of $17.3 Million.
The major source of cash from operations was net loss
adjusted for non-cash provisions such as depreciation and
amortization. Investing activities during the period
included returns from investments in direct financing leases
of approximately $1.0 Million and investments in short-term
marketable securities of $0.8 Million, which were
approximately offset by costs incurred to upgrade and
drydock two of the Company's vessels.
The net cash used for financing activities of $17.3
Million included reductions of debt and capital lease
obligations of $21.9 Million stemming from regularly
scheduled principal payments and repayments of amounts drawn
under lines of credit. New draws under lines of credit
totaled $5.0 Million during the quarter, which were repaid
early in the second quarter.
At March 31, 2000, $14.0 Million was outstanding on the
Company's $48.0 Million revolving credit facility, of which
$5.0 Million was repaid early in the second quarter.
Management believes that normal operations will provide
sufficient working capital and cash flows to meet debt
service and dividend requirements during the foreseeable
future. The Company is expected to finance approximately
$22 Million on the purchase of the new PCTC as discussed
earlier. The possible sale of the Company's PCC and
purchase of this PCTC is subject to Maritime Administration
approval.
The Company has not been notified that it is a
potentially responsible party in connection with any
environmental matters.
At a regular meeting held April 12, 2000, the Board of
Directors declared a quarterly dividend of 6.25 cents per
Common Share payable on June 16, 2000, to shareholders of
record on June 2, 2000.
<PAGE>14
STOCK REPURCHASE PROGRAM
In October of 1998, the Company's Board of Directors
approved a stock repurchase program to buy up to 500,000
shares of its common stock. In October of 1999, the Company
had completed the program. In October of 1999, the
Company's Board of Directors approved another stock
repurchase program to buy up to 1,000,000 shares of its
common stock, based on the Board's belief that the current
market value of the Company's common stock does not
adequately reflect the Company's inherent value. The
repurchases are expected to be made in the open market or in
privately negotiated transactions at the discretion of the
Company's management, depending upon financial and market
conditions. As of March 31, 2000, 600,000 shares had been
repurchased under these two programs for a total cost of
$7,571,000 at an average market price of $12.68 per share,
of which 4,300 shares had been repurchased during 2000.
NEW ACCOUNTING PRONOUNCEMENTS
During 1998, the Financial Accounting Standards Board
("FASB") issued Statement of Financial Accounting Standard
("SFAS") No. 133, "Accounting for Derivative Instruments and
Hedging Activities." SFAS No. 133 establishes accounting and
reporting standards for derivative instruments, including
certain derivative instruments embedded in other contracts,
and for hedging activities. It requires that an entity
recognize all derivatives as either assets or liabilities in
the statement of financial position and measure those
instruments at fair value. SFAS No. 133 is effective for
all fiscal quarters of fiscal years beginning after June 15,
1999. In June of 1999, the FASB issued SFAS No. 137,
"Accounting for Derivative Instruments and Hedging
Activities - Deferral of the Effective Date of FASB
Statement No. 133." SFAS No. 137 is an amendment of SFAS No.
133 and defers the effective date of SFAS No. 133 to fiscal
years beginning after June 15, 2000. The Company has not
chosen early adoption and, as it is not possible to predict
the Company's derivative position at the time this standard
will be applied, it is unknown what effect, if any, SFAS No.
133 will have on its financial statements once adopted.
While the Company has not yet quantified the impact on its
financial statements, the Company does not believe adoption
will have a material impact on net income, although adoption
is likely to increase volatility of comprehensive income and
accumulated other comprehensive income.
<PAGE>15
MARKET-SENSITIVE INSTRUMENTS AND RISK MANAGEMENT
In the ordinary course of its business, the Company is
exposed to foreign currency, interest rate, and commodity
price risk. The Company utilizes derivative financial
instruments including forward exchange contracts, interest
rate swap agreements and commodity swap agreements to manage
certain of these exposures. The Company hedges only firm
commitments or anticipated transactions and does not use
derivatives for speculation. The Company neither holds nor
issues financial instruments for trading purposes.
There were no material changes in market risk exposure
for the foreign currency risk described in the Company's
Form 10-K filed with the Securities and Exchange Commission
for the year ended December 31, 1999.
The fair value of long-term debt at March 31, 2000,
including current maturities, was estimated to be $397.7
Million compared to a carrying value of $400.8 Million. The
potential increase in fair value resulting from a
hypothetical 10% increase in the average interest rates
applicable to the Company's long-term debt at March 31,
2000, would be approximately $18.1 Million or 4.5% of the
carrying value.
The fair value of the interest rate swap agreements at
March 31, 2000, as discussed in the Form 10-K, estimated
based on the amount that the banks would receive or pay to
terminate the swap agreements at the reporting date taking
into account current market conditions and interest rates,
was an asset of $4.2 Million. A hypothetical 10% decrease
in interest rates as of March 31, 2000, would have resulted
in a $1.6 Million decrease in the fair value of the asset.
The fair value of the commodity swap agreements at
March 31, 2000, as discussed in the Form 10-K, estimated
based on the difference between first quarter price per ton
of fuel and the contract delivery price per ton of fuel
times the quantity applicable to the agreements, was an
asset of $766,000. A hypothetical 10% decrease in the first
quarter fuel price per ton of fuel as of March 31, 2000,
would have resulted in a liability of $32,000.
<PAGE>16
PART II - OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
The Annual Meeting of Shareholders was held April 12,
2000. The matters voted upon and the results of the voting
were as follows:
(1) Election of Board of Directors:
Nominee Shares Voted For Withheld Authority
- ------------------ -------------------- --------------------
Niels W. Johnsen 5,459,326 178,065
Erik F. Johnsen 5,459,326 178,065
Niels M. Johnsen 5,459,816 177,575
Erik L. Johnsen 5,459,816 177,575
Harold S. Grehan, Jr. 5,459,816 177,575
Raymond V. O'Brien, Jr. 5,459,559 177,832
Edwin Lupberger 5,459,816 177,575
Edward K. Trowbridge 5,459,816 177,575
(2) Ratification of Arthur Andersen LLP, certified public
accountants, as independent auditors for the
Corporation for the fiscal year ending December 31,
2000:
Shares Voted For 5,616,657
Shares Voted Against 297
Abstentions 20,437
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) EXHIBIT INDEX
Exhibit Number Description
-------------- ------------
Part I Exhibits: 27 Financial Data Schedule
Part II Exhibits: 3 Restated Certificate of Incorporation
as amended, and By-Laws of the
Registrant (filed with the Securities
and Exchange Commission as Exhibit 3
to the Registrant's Form 10-Q for
the quarterly period June 30, 1996,
and incorporated herein by
reference)
(b) No reports on Form 8-K were filed for the three month period ended
March 31, 2000.
<PAGE>17
SIGNATURES
Pursuant to the requirements of the Securities and
Exchange Act of 1934, the registrant has duly caused this
report to be signed on its behalf by the undersigned
thereunto duly authorized.
INTERNATIONAL SHIPHOLDING CORPORATION
/S/ Gary L. Ferguson
____________________________________________
Gary L. Ferguson
Vice President and Chief Financial Officer
Date May 12, 2000
--------------------------
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM FINANCIAL
STATEMENTS FOR THE PERIOD ENDED MARCH 31, 2000 AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-2000
<PERIOD-END> MAR-31-2000
<CASH> 23,963
<SECURITIES> 10,474
<RECEIVABLES> 56,936
<ALLOWANCES> 413
<INVENTORY> 12,932
<CURRENT-ASSETS> 112,054
<PP&E> 820,463
<DEPRECIATION> 390,231
<TOTAL-ASSETS> 718,129
<CURRENT-LIABILITIES> 82,804
<BONDS> 382,039
0
0
<COMMON> 6,756
<OTHER-SE> 171,912
<TOTAL-LIABILITY-AND-EQUITY> 718,129
<SALES> 0
<TOTAL-REVENUES> 89,024
<CGS> 0
<TOTAL-COSTS> 85,555
<OTHER-EXPENSES> 8,524
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 8,524
<INCOME-PRETAX> (4,796)
<INCOME-TAX> (1,542)
<INCOME-CONTINUING> (3,299)
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> (3,299)
<EPS-BASIC> (0.54)
<EPS-DILUTED> (0.54)<F1><F2>
<FN>
<F1>AMOUNTS INAPPLICABLE OR NOT DISCLOSED AS A SEPARATE LINE ON THE BALANCE
SHEET OR STATEMENT OF INCOME ARE REPORTED AS 0 HEREIN.
<F2>NOTES AND ACCOUNTS RECEIVABLE-TRADE ARE REPORTED NET OF ALLOWANCES FOR
DOUBTFUL ACCOUNTS IN THE BALANCE SHEET.
</FN>
</TABLE>
