-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, EMLf1qfqSHO59VBqcCPRqQFEvMkUj/tZJPcO85sP+veJ9qHKJw08NaBWkkfWzhGn lOfpkNEo6Nfk4pH7Tt4zQQ== 0000278041-05-000017.txt : 20050520 0000278041-05-000017.hdr.sgml : 20050520 20050520124620 ACCESSION NUMBER: 0000278041-05-000017 CONFORMED SUBMISSION TYPE: 10-Q/A PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 20050331 FILED AS OF DATE: 20050520 DATE AS OF CHANGE: 20050520 FILER: COMPANY DATA: COMPANY CONFORMED NAME: INTERNATIONAL SHIPHOLDING CORP CENTRAL INDEX KEY: 0000278041 STANDARD INDUSTRIAL CLASSIFICATION: DEEP SEA FOREIGN TRANSPORTATION OF FREIGHT [4412] IRS NUMBER: 362989662 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q/A SEC ACT: 1934 Act SEC FILE NUMBER: 001-10852 FILM NUMBER: 05847290 BUSINESS ADDRESS: STREET 1: 650 POYDRAS ST STE 1700 CITY: NEW ORLEANS STATE: LA ZIP: 70130 BUSINESS PHONE: 5045295470 10-Q/A 1 q051stqa.txt 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q/A (Amendment No. 1) (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, 2005 ---------------- __ 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 incorporation or organization) Number) 650 Poydras Street New Orleans, Louisiana 70130 - ----------------------------------------------------------------------------- (Address of principal executive offices) (Zip Code) (504) 529-5461 - ----------------------------------------------------------------------------- (Registrant's telephone number, including area code) Not Applicable - ----------------------------------------------------------------------------- (Former name, former address and former fiscal year, if changed since last report) 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 requirements for the past 90 days. YES ____x____ NO ________ Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act). YES _________ NO____x_____ 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, 2005) - ------------------------------- ---------------- ---------------- 2 EXPLANATORY NOTE ---------------- This Amendment No. 1 to International Shipholding Corporation's Form 10-Q for the quarter ended March 31, 2005 is filed solely to correct a typographical error in the amount set forth for the line item "Long-Term Debt, Less Current Maturities" as of March 31, 2005 in the Corporation's consolidated condensed balance sheets contained in Item 1 of Part I of the Corporation's original filing on May 12, 2005. The correct amount for this line item is $146,265, whereas the amount set forth in the original filing was $142,265. This mistake occurred in the course of formatting the Form 10-Q for filing via the Commission's EDGAR system. This Amendment No. 1 does not change any other information set forth in the original filing of the Corporation's Form 10-Q for the quarter ended March 31, 2005. However, in accordance with Rule 12b-15 promulgated under the Exchange Act,this Amendment No. 1 sets forth the complete text of Item 1 of Part I of the Corporation's Form 10-Q for the quarter ended March 31, 2005, as amended, and includes new Rule 13a-14(a)/15d-14(a) certifications as Exhibits 31.1 and 31.2 and new Rule 13a-14(b)/15d-14(b) certifications as Exhibits 32.1 and 32.2. 3 PART I - FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS INTERNATIONAL SHIPHOLDING CORPORATION CONSOLIDATED CONDENSED STATEMENTS OF INCOME (All Amounts in Thousands Except Share Data) (Unaudited)
Three Months Ended March 31, 2005 2004 --------- --------- Revenues $ 69,788 $ 65,843 Operating Expenses: Voyage Expenses 55,348 51,470 Vessel and Barge Depreciation 5,612 4,627 --------- --------- Gross Voyage Profit 8,828 9,746 --------- --------- Administrative and General Expenses 4,389 3,851 (Gain) Loss on Sale of Other Assets (31) 7 --------- --------- Operating Income 4,470 5,888 --------- --------- Interest and Other: Interest Expense 2,543 2,722 Loss on Sale of Investment - 623 Investment Income (285) (168) Loss on Early Extinguishment of Debt - 31 --------- --------- 2,258 3,208 --------- --------- Income Before Provision for Income Taxes and Equity in Net Income of Unconsolidated Entities 2,212 2,680 --------- --------- Provision for Income Taxes: Current 54 105 Deferred 230 887 State 14 3 --------- --------- 298 995 --------- --------- Equity in Net Income of Unconsolidated Entities (Net of Applicable Taxes) 2,179 1,212 --------- --------- Net Income $ 4,093 $ 2,897 ========= ========= Preferred Stock Dividends 567 - --------- --------- Net Income Available to Common Stockholders $ 3,526 $ 2,897 ========= ========= Basic and Diluted Earnings Per Common Share: Net Income Available to Common Stockholders $ 0.58 $ 0.48 ========= ========= Weighted Average Shares of Common Stock Outstanding: Basic 6,082,887 6,082,887 Diluted 6,111,906 6,092,666 The accompanying notes are an integral part of these statements.
4 INTERNATIONAL SHIPHOLDING CORPORATION CONSOLIDATED CONDENSED BALANCE SHEETS (All Amounts in Thousands) (Unaudited)
March 31, December 31, ASSETS 2005 2004 ------------ ------------ Current Assets: Cash and Cash Equivalents $ 32,265 $ 10,513 Marketable Securities 6,216 6,138 Accounts Receivable, Net of Allowance for Doubtful Accounts of $174 and $146 in 2005 and 2004, Respectively: Traffic 18,925 20,953 Agents' 5,022 3,509 Claims and Other 8,442 5,135 Federal Income Taxes Receivable 399 459 Deferred Income Tax 27 187 Net Investment in Direct Financing Lease 2,390 2,337 Other Current Assets 3,845 4,756 Material and Supplies Inventory, at Lower of Cost or Market 3,221 3,239 Current Assets Held for Disposal 55 89 ------------ ------------ Total Current Assets 80,807 57,315 ------------ ------------ Investment in Unconsolidated Entities 13,169 11,115 ------------ ------------ Net Investment in Direct Financing Lease 46,166 46,776 ------------ ------------ Vessels, Property, and Other Equipment, at Cost: Vessels and Barges 357,086 348,307 Other Equipment 7,082 7,082 Terminal Facilities 140 140 Furniture and Equipment 3,473 3,484 ------------ ------------ 367,781 359,013 Less - Accumulated Depreciation (135,255) (129,560) ------------ ------------ 232,526 229,453 ------------ ------------ Other Assets: Deferred Charges, Net of Accumulated Amortization of $14,259 and $16,374 in 2005 and 2004, Respectively 13,368 14,809 Acquired Contract Costs, Net of Accumulated Amortization of $23,249 and $22,886 in 2005 and 2004, Respectively 7,276 7,640 Restricted Cash 6,541 6,541 Due from Related Parties 135 2,535 Other 8,786 8,864 ------------ ------------ 36,106 40,389 ------------ ------------ $ 408,774 $ 385,048 ============ ============ The accompanying notes are an integral part of these statements.
5 INTERNATIONAL SHIPHOLDING CORPORATION CONSOLIDATED CONDENSED BALANCE SHEETS (All Amounts in Thousands Except Share Data) (Unaudited)
March 31, December 31, LIABILITIES AND STOCKHOLDERS' INVESTMENT 2005 2004 ------------ ------------ Current Liabilities: Current Maturities of Long-Term Debt $ 9,468 $ 9,468 Accounts Payable and Accrued Liabilities 35,479 30,197 ------------ ------------ Total Current Liabilities 44,947 39,665 ------------ ------------ Billings in Excess of Income Earned and Expenses Incurred 4,243 4,723 ------------ ------------ Long-Term Debt, Less Current Maturities 146,265 168,622 ------------ ------------ Other Long-Term Liabilities: Deferred Income Taxes 15,778 15,222 Other 20,953 21,362 ------------ ------------ 36,731 36,584 ------------ ------------ Commitments and Contingent Liabilities Convertible Exchangeable Preferred Stock 37,554 - ------------ ------------ Stockholders' Investment: Common Stock 6,756 6,756 Additional Paid-In Capital 54,450 54,450 Retained Earnings 86,241 82,715 Treasury Stock (8,704) (8,704) Accumulated Other Comprehensive Income 291 237 ------------ ------------ 139,034 135,454 ------------ ------------ $ 408,774 $ 385,048 ============ ============ The accompanying notes are an integral part of these statements.
6 INTERNATIONAL SHIPHOLDING CORPORATION CONSOLIDATED STATEMENTS OF CASH FLOWS (All Amounts in Thousands) (Unaudited)
Three Months Ended March 31, 2005 2004 ------------ ------------ Cash Flows from Operating Activities: Net Income $ 4,093 $ 2,897 Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities: Depreciation 5,710 4,759 Amortization of Deferred Charges and Other Assets 2,013 1,813 Provision for Deferred Federal Income Taxes 230 887 Equity in Net Income of Unconsolidated Entities (2,179) (1,212) (Gain) Loss on Sale of Other Assets (31) 7 Loss on Early Extinguishment of Debt - 31 Loss on Sale of Investment - 623 Changes in: Accounts Receivable (2,731) 8,153 Inventories and Other Current Assets 1,437 1,116 Deferred Drydocking Charges (1,533) (483) Other Assets 62 182 Accounts Payable and Accrued Liabilities 5,640 (2,667) Federal Income Taxes Payable (58) (238) Billings in Excess of Income Earned and Expenses Incurred (480) (3,509) Other Long-Term Liabilities (141) (1,527) ------------ ------------ Net Cash Provided by Operating Activities 12,032 10,832 ------------ ------------ Cash Flows from Investing Activities: Net Investment in Direct Financing Lease 557 526 Additions to Vessels and Other Assets (8,844) (1,366) Proceeds from Sale of Other Assets 88 - Purchase of and Proceeds from Short Term Investments - (378) Distributions from (Investment in) Unconsolidated Entities 723 - Net Decrease in Restricted Cash Account - 865 Collection of Related Party Note Receivable 2,400 - ------------ ------------ Net Cash Used by Investing Activities (5,076) (353) ------------ ------------ Cash Flows from Financing Activities: Proceeds from Issuance of Preferred Stock 37,725 - Repayment of Debt (22,357) (4,887) Additions to Deferred Financing Charges (5) (64) Preferred Stock Dividends Paid (567) - Other Financing Activities - (1) ------------ ------------ Net Cash Provided (Used) by Financing Activities 14,796 (4,952) ------------ ------------ Net Increase in Cash and Cash Equivalents 21,752 5,527 Cash and Cash Equivalents at Beginning of Period 10,513 8,881 ------------ ------------ Cash and Cash Equivalents at End of Period $ 32,265 $ 14,408 ============ ============ The accompanying notes are an integral part of these statements.
7 NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS MARCH 31, 2005 (Unaudited) Note 1. Basis of Preparation We have prepared the accompanying unaudited interim financial statements pursuant to the rules and regulations of the Securities and Exchange Commission, and we have omitted certain information and footnote disclosures required by generally accepted accounting principles for complete financial statements. The condensed consolidated balance sheet as of December 31, 2004 has been derived from the audited financial statements at that date. We suggest that you read these interim statements in conjunction with the financial statements and notes thereto included in our Form 10-K for the year ended December 31, 2004. We have made certain reclassifications to prior period financial information in order to conform to current year presentations. The foregoing 2005 interim results are not necessarily indicative of the results of operations for the full year 2005. Interim statements are subject to possible adjustments in connection with the annual audit of our accounts for the full year 2005. Management believes that all adjustments necessary, consisting only of normal recurring adjustments, for a fair presentation of the information shown have been made. Our policy is to consolidate all subsidiaries in which we hold a greater than 50% voting interest and to use the equity method to account for investments in entities in which we hold a 20% to 50% voting interest. We use the cost method to account for investments in entities in which we hold less than 20% voting interest and in which we cannot exercise significant influence over operating and financial activities. We have eliminated all significant intercompany accounts and transactions. Note 2. Employee Benefit Plans The following table provides the components of net periodic benefit cost for the plans:
(All Amounts in Thousands) Postretirement Pension Plan Benefits ------------------ ----------------- Three Months Ended Three Months Ended March 31, March 31, Componenets of net periodic benefit cost: 2005 2004 2005 2004 -------- -------- -------- ------- Service cost $ 169 $ 137 $ 23 $ 19 Interest cost 315 308 134 147 Expected return on plan assets (372) (346) - - Amortization of prior service cost - 2 (6) - Amortization of net actuarial loss 41 23 25 25 -------- -------- -------- ------- Net periodic benefit cost $ 153 $ 124 $ 176 $ 191 ======== ======== ======== =======
We do not expect to make a contribution to our pension plan or to our postretirement benefits plan in 2005. In December of 2003, the Medicare Prescription Drug, Improvements, and Modernization Act of 2003 ("Act") was signed into law. In addition to including numerous other provisions that have potential effects on an employer's retiree health plan, the Medicare law included a special subsidy for employers that sponsor retiree health plans with prescription drug benefits that are at least as favorable as the new Medicare Part D benefit. In May of 2004, the Financial Accounting Standards Board ("FASB") issued FASB Staff Position ("FSP") 106-2, "Accounting 8 and Disclosure Requirements Related to the Medicare Prescription Drug, Improvements, and Modernization Act of 2003," that provides guidance on the accounting for the effects of the Act for employers that sponsor postretirement health care plans that provide drug benefits. We are still evaluating whether our plan is actuarially equivalent, although the impact of any adjustments on our financial position and results of operations is not expected to be material. Note 3. Operating Segments Our four operating segments, Liner Services, Time Charter Contracts, Contracts of Affreightment ("COA"), and Rail-Ferry Service, are identified primarily by the characteristics of the contracts and terms under which our vessels and barges are operated. We report in the Other category results of several of our subsidiaries that provide ship charter brokerage and agency services, as well as our over-the-road car transportation truck company. We manage each reportable segment separately, as each requires different resources depending on the nature of the contract or terms under which each vessel within the segment operates. We do not allocate administrative and general expenses, investment income, losses or gains on early extinguishment of debt, equity in net income of unconsolidated entities, or income taxes to our segments. Intersegment revenues are based on market prices and include revenues earned by our subsidiaries that provide specialized services to the operating segments. The following table presents information about segment profit and loss for the three months ended March 31, 2005 and 2004:
(All Amounts in Thousands) Time Liner Charter Contracts of Rail-Ferry Services Contracts Affreightment Service Other Elim. Total - ------------------------------------------------------------------------------- 2005 Revenues from external customers $25,642 $34,485 $4,101 $4,022 $ 1,538 - $ 69,788 Intersegment revenues - - - - 3,104 (3,104) - Vessel and barge depreciation 859 3,226 604 729 194 - 5,612 Gross voyage (loss) profit (114) 8,481 1,210 (914) 165 - 8,828 Interest expense 173 1,543 341 442 44 - 2,543 Gain on sale of other assets - - - - 31 - 31 Segment (loss) profit (287) 6,938 869 (1,356) 152 - 6,316 - ------------------------------------------------------------------------------- 2004 Revenues from external customers $23,232 $29,079 $3,995 $4,056 $5,481 - $65,843 Intersegment revenues - - - - 3,113 (3,113) - Vessel and barge depreciation 856 2,283 604 729 155 - 4,627 Gross voyage Profit (loss) 462 7,715 1,301 (864) 1,132 - 9,746 Interest expense 221 1,550 391 505 55 - 2,722 Loss on sale of other assets - - - - (7) - (7) Segment profit (loss) 241 6,165 910 (1,369) 1,070 - 7,017 - -------------------------------------------------------------------------------
9 Following is a reconciliation of the totals reported for the operating segments to the applicable line items in the consolidated financial statements:
(All Amounts in Thousands) Three Months Ended March 31, 2005 2004 Profit or Loss: ---------- ---------- Total Profit for Reportable Segments $6,316 $7,017 Unallocated Amounts: Administrative and General Expenses (4,389) (3,851) Loss on Sale of Investment - (623) Investment Income 285 168 Loss on Early Extinguishment of Debt - (31) ---------- ---------- Income Before Provision for Income Taxes and Equity in Net Income of Unconsolidated Entities $2,212 $2,680 ========== ==========
Note 4. Unconsolidated Entities In the fourth quarter of 2003, through our wholly-owned subsidiary, we acquired a 50% investment in Dry Bulk Cape Holding Inc. ("Dry Bulk"), which owns two cape-size bulk carrier vessels built in calendar years 2002 and 2003. We account for our investment in Dry Bulk under the equity method, and as such our share of the earnings or losses of Dry Bulk is reported as equity in net income of unconsolidated entities, net of taxes, in our consolidated statements of income. For the three months ended March 31, 2005 and 2004, our portion of earnings, net of taxes, was $1.2 million and $1.1 million, respectively. We expect the 2005 earnings of Dry Bulk to be distributed in the current year, which would allow those earnings to qualify under the temporary dividends received exclusion, which allows for a one-time federal tax exclusion of 85% of those earnings if certain criteria are met (see Note 7. Income Taxes for a further discussion on the dividends received exclusion). In April of 2004, we received a cash distribution of $1.6 million from Dry Bulk representing first quarter earnings for 2004, which was recorded as reductions of our investment in Dry Bulk. At March 31, 2005, our wholly-owned subsidiary was a guarantor of a portion of the outstanding debt of Dry Bulk. The guarantee is for the full remaining term of the debt, which was seven years as of December 31, 2004. Performance by our subsidiary under the guarantee would be required in the event of default by Dry Bulk on the debt. International Shipholding Corporation has delivered a promissory note in the amount of $31.8 million to the wholly-owned subsidiary, which the subsidiary may demand payment on if necessary to perform its obligations under the guarantee. The subsidiary has assigned the promissory note to the lenders to secure the subsidiary's obligations under the guarantee. The portion of the outstanding debt that the subsidiary guarantees was $29.6 million at March 31, 2005. The estimated fair value of the non-contingent portion of the guarantee is immaterial. The unaudited combined condensed results of operations of Dry Bulk are summarized below:
(All Amounts in Thousands) Three Months Ended March 31, 2005 2004 ---------- ---------- Operating Revenue $4,582 $5,682 Operating Income $3,072 $4,100 Net Income $2,307 $3,324
10 Note 5. Earnings Per Share Basic and diluted earnings per share were computed based on the weighted average number of common shares issued and outstanding during the relevant periods. Stock options covering 475,000 shares were included in the computation of diluted earnings per share in the first three months of 2005 and 2004. Note 6. Comprehensive Income The following table summarizes components of comprehensive income for the three months ended March 31, 2005 and 2004:
Three Months Ended March 31, (Amounts in Thousands) 2005 2004 --------- --------- Net Income $ 4,093 $ 2,897 Other Comprehensive Income: Recognition of Unrealized Holding Loss on Marketable Securities, Net of Deferred Taxes of $216 - 402 Unrealized Holding Gain on Marketable Securities, Net of Deferred Taxes of $27 and $14, Respectively 51 26 Net Change in Fair Value of Derivatives, Net of Deferred Taxes of $5 and $189, Respectively 3 352 --------- --------- Total Comprehensive Income $ 4,147 $ 3,677 ========= =========
Note 7. Income Taxes Under previous United States tax law, U.S. companies like us and their domestic subsidiaries generally were taxed on all income, including in our case income from shipping operations, whether derived in the United States or abroad. With respect to any foreign subsidiary in which we hold more than a 50 percent interest (referred to in the tax laws as a controlled foreign corporation, or "CFC"), we were treated as having received a current taxable distribution of our pro rata share of income derived from foreign shipping operations. The American Jobs Creation Act of 2004 ("Jobs Creation Act"), which became effective for us on January 1, 2005, changed the United States tax treatment of our U.S. flag vessels in foreign operations and foreign flag shipping operations. During December of 2004, we made an election under the Jobs Creation Act to have our U.S. flag operations (other than two ineligible vessels used exclusively in United States coastwise commerce) taxed under a new "tonnage tax" regime rather than under the usual U.S. corporate income tax regime. As a result of that election, going forward our gross income for United States income tax purposes with respect to our eligible U.S. flag vessels will not include (1) income from qualifying shipping activities in U.S. foreign trade (i.e., transportation between the U.S. and foreign ports or between foreign ports), (2) income from cash, bank deposits and other temporary investments that are reasonably necessary to meet the working capital requirements of our qualifying shipping activities, and (3) income from cash or other intangible assets accumulated pursuant to a plan to purchase qualifying shipping assets. Under the tonnage tax regime, our taxable income with respect to the operations of our eligible U.S. flag vessels will be based on a "daily notional taxable income," which will be taxed at the highest corporate income tax 11 rate. The daily notional taxable income from the operation of a qualifying vessel will be 40 cents per 100 tons of the net tonnage of the vessel up to 25,000 net tons, and 20 cents per 100 tons of the net tonnage of the vessel in excess of 25,000 net tons. The taxable income of each qualifying vessel will be the product of its daily notional taxable income and the number of days during the taxable year that the vessel operates in United States foreign trade. Under the Jobs Creation Act, the taxable income from the shipping operations of CFCs will generally no longer be subject to current United States income tax until repatriated. As of December 31, 2004, these CFCs had an accumulated deficit of $12.4 million. A valuation allowance has been recorded for 100% of the related tax benefits. Until the CFCs earn income to fully recoup this accumulated deficit, no income tax provision or benefits is expected related to these CFCs. However, the Jobs Creation Act provides a lower effective tax rate on the taxable income from the shipping operations of our CFCs under the one-time dividends received exclusion. Under this one-time exclusion, which only applies to the current year's income, 85% of the income will be exempt from U.S. taxes if those funds are received from a CFC in the form of a dividend by the U.S. parent company, if certain criteria are met. As a result of the Jobs Creation Act, our effective tax rate on first quarter earnings, including the results of unconsolidated entities, is 17.5% as compared to 36.3% in the comparable quarter of 2004. Our effective tax rate before equity in net income of unconsolidated entities is 13.5% in the first quarter of 2005 as compared to 37.1% in the comparable quarter of 2004. Note 8. Preferred Stock Offering On January 6, 2005, we announced the completion of our public offering of 800,000 shares of 6.0% convertible exchangeable preferred stock with a liquidation preference of $50 per share, or $40 million in total. The proceeds of the preferred stock offering, after deducting all associated costs, were $37.6 million. The preferred stock accrues cash dividends from the date of issuance at a rate of 6.0% per annum. The preferred stock is initially convertible into two million shares of our common stock, equivalent to an initial conversion price of $20.00 per share of our common stock and reflecting a 34% conversion premium to the $14.90 per share closing price of our common stock on the New York Stock Exchange on December 29, 2004. All shares of the preferred stock, which is a new series of our capital stock, were sold. Note 9. New Accounting Pronouncements In December of 2004, the FASB issued Statement No. 123 (revised 2004), "Share-Based Payment," which is a revision of FASB Statement No. 123, "Accounting for Stock-Based Compensation." Statement No. 123(R) supersedes APB Opinion No. 25, "Accounting for Stock Issued to Employees," and amends FASB Statement No.95, "Statement of Cash Flows." Statement No. 123(R) requires all share-based payments to employees, including grants of employee stock options, to be recognized in the income statement based on their fair values. Pro forma disclosures are no longer an alternative. Statement No. 123(R) was initially effective for periods beginning after June 15, 2005. In April of 2005, the U.S. Securities and Exchange Commission announced a deferral of the effective date of Statement No. 123(R) for calendar year companies until the beginning of 2006. We plan to adopt Statement No. 123(R) on January 1, 2006. 12 Statement No. 123(R) permits public companies to adopt its requirements using either a modified prospective method or a modified retrospective method. Under the modified prospective method, companies are required to record compensation cost for new and modified awards over the related vesting period of such awards prospectively and record compensation cost prospectively for the unvested portion, at the date of adoption, of previously issued and outstanding awards over the remaining vesting period of such awards. No change to prior periods presented is permitted under the modified prospective method. Under the modified retrospective method, companies record compensation costs for prior periods retroactively through restatement of such periods using the pro forma amounts previously disclosed in the footnotes. Also, in the period of adoption and after, companies record compensation cost based on the modified prospective method. We have not yet determined the method of adoption we will use. As permitted by Statement No. 123, we account for share-based payments to employees using APB Opinion No. 25 and no compensation expense has been recognized for employee options granted under the Stock Incentive Plan. Accordingly, the adoption of Statement No. 123(R)'s fair value method will have an impact on our results of operations, although it will have no impact on our overall financial position. However, the impact of adoption of Statement No. 123(R) cannot be predicted at this time because it will depend on levels of share-based payments granted in the future. However, had we adopted Statement No. 123(R) in prior periods, there would have been no impact as described in the disclosure of pro forma net income and earnings per share in Note E - Employee Benefit Plans of the Notes to the Consolidated Financial Statements contained in our December 31, 2004 Form 10-K. 13 PART II - OTHER INFORMATION ITEM 6. EXHIBITS (a) EXHIBIT INDEX Exhibit Number Description -------------- ------------------------------------- Part II Exhibits: 3.1 Restated Certificate of Incorporation of the Registrant (filed with the Securities and Exchange Commission as Exhibit 3.1 to the Registrant's Form 10-Q for the quarterly period ended September 30, 2004, and incorporated herein by reference) 3.2 By-Laws of the Registrant (filed with the Securities and Exchange Commission as Exhibit 3.2 to the Registrant's Form 10-Q for the quarterly period ended September 30, 2004, and incorporated herein by reference) 10.1 Summary of Executive Officer's Salaries * 31.1 Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 ** 31.2 Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 ** 32.1 Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 ** 32.2 Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 ** __________ * Previously filed as part of the Registrant's Form 10-Q for the quarter ended March 31, 2005, filed with the Commission on May 12, 2005. ** Submitted electronically herewith. 14 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 May 20, 2005 Date ___________________________ EX-31.1 2 q051stqex311a.txt EXHIBIT 31.1 CERTIFICATION I, Erik F. Johnsen, certify that: 1. I have reviewed this amendment to the quarterly report on Form 10-Q of International Shipholding Corporation; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) [omitted in accordance with Section III.E of SEC Release No. 34-47986] for the registrant and have: a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) [omitted in accordance with Section III.E of SEC Release No. 34-47986]; c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors: a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: May 20, 2005 /s/ Erik F. Johnsen ______________________________ Erik F. Johnsen Chairman of the Board of Directors and Chief Executive Officer International Shipholding Corporation EX-31.2 3 q051stqex312a.txt EXHIBIT 31.2 CERTIFICATION I, Gary L. Ferguson, certify that: 1. I have reviewed this amendment to the quarterly report on Form 10-Q of International Shipholding Corporation; 2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; 3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; 4. The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) [omitted in accordance with Section III.E of SEC Release No. 34-47986] for the registrant and have: a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; b) [omitted in accordance with Section III.E of SEC Release No. 34-47986]; c) Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and d) Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and 5. The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors: a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. Date: May 20, 2005 /s/ Gary L. Ferguson ______________________________ Gary L. Ferguson Vice President and Chief Financial Officer International Shipholding Corporation EX-32.1 4 q051stqex321a.txt Exhibit 32.1 Certification of CEO Pursuant to 18 U.S.C. Section 1350 (Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002) In connection with this amendment to the Quarterly Report on Form 10-Q of International Shipholding Corporation (the "Company") for the period ending March 31, 2005 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Erik F. Johnsen, as Chairman and Chief Executive Officer of the Company, has reviewed the amendment to the Company's Form 10-Q which is being filed to correct a typographical error that occurred in the course of formatting the Form 10-Q for filing via the Commission's EDGAR system and hereby certifies, pursuant to 18 U.S.C. Section 1350,as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge: (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Dated: May 20, 2005 /s/ Erik F. Johnsen ----------------------------- Erik F. Johnsen Chairman of the Board and Chief Executive Officer A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request. This certification accompanies the Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. EX-32.2 5 q051stqex322a.txt Exhibit 32.2 Certification of CFO Pursuant to 18 U.S.C. Section 1350 (Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002) In connection with this amendment to the Quarterly Report on Form 10-Q of International Shipholding Corporation (the "Company") for the period ending March 31, 2005 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), Gary L. Ferguson, as Chief Financial Officer of the Company, has reviewed the amendment to the Company's Form 10-Q which is being filed to correct a typographical error that occurred in the course of formatting the Form 10-Q for filing via the Commission's EDGAR system and hereby certifies, pursuant to 18 U.S.C. Section 1350,as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge: (1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and (2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. Dated: May 20, 2005 /s/ Gary L. Ferguson ---------------------------- Gary L. Ferguson Vice President and Chief Financial Officer A signed original of this written statement required by Section 906 of the Sarbanes-Oxley Act of 2002 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request. This certification accompanies the Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. -----END PRIVACY-ENHANCED MESSAGE-----