International Shipholding operates a diversified fleet of US and international flag vessels. The company makes money by providing international and domestic maritime transportation services to commercial and governmental customers primarily under medium to long-term time charters or contracts of affreightment. With its roughly 33 vessels, the company owns 14 vessels of total vessels which total comprises a diversified line of ships from military transport to coal transports.
ISH divides its revenues into the following operating segments:
As a shipping company that contains some operations in military transport, ISH operates under the Maritime Security Act of 1996. Under this Act, Congress makes appropriations to companies such as ISH to receive $2.9 million in the year 2011, and $3.1 million in 2012 to 2015. However, since these payments are not guaranteed, any budget cuts from defense spending that results to negative implications in payments for ISH would decrease revenues for that segment. In this regard, the company currently commits eight vessels under contracts issued under the program.
ISH operates in an industry that is highly competitive, where newer fleets tend to receive more business due to reliability. Further, older ships require more capital expenditure and are also harder to estimate. Finally, in lieu of changes in government regulation, compliance with customer requirements may force ISH to alter or add new equipment. In this regard, ISH's average age of all vessels is approximately 12 years, with Pure Car/Truck Carrier Fleet at around 10 years.
ISH competes with other international shipping service companies such as: