International Shipholding makes move
Sunday, April 22, 2007By KAIJA WILKINSONBusiness Reporter
International Shipholding Corp. marks a milestone this week during its shareholders meeting Tuesday at its new corporate headquarters in the RSA Battle House Tower. During the meeting, 81-year-old Erik F. Johnsen, one of the company's founders, plans to retire as chairman, and his son, Erik L. Johnsen, 49, would be named president.
Erik L. Johnsen's cousin, Niels Johnsen, 61, will become chairman and chief executive.
Other than these key executive changes and the election of nine directors, Erik L. Johnsen said it will be business as usual for the company, which was founded in New Orleans in 1947 as Central Gulf Steamship Corp.
In the wake of Hurricane Katrina and what could have been a death-blow to its CG Railway Inc. subsidiary, the company announced last summer it would pull up its roots and make a fresh start in Mobile.
CG is a rail-on-barge service connecting Mexico to the Gulf Coast. The state of Alabama and the Alabama State Port Authority agreed to build a new $26 million terminal for the service as a key part of the incentives deal that lured International Shipholding.
Last weekend, 106 International Shipholding employees moved into their new digs in the on 17th and 18th floors of the RSA building. For at least a while, their only neighbors will be construction workers, since the company is the first tenant in the landmark Mobile building.
Settling into his new office late last week, the younger Johnsen said the move was, "thankfully," uneventful, and right now he's simply hoping that the employees get settled in Mobile and adjusted to a new environment fairly quickly.
"I think business goes along the same as it has always gone, but you're just going to a different office, a different house, a different apartment, and just learning the city," which he added is not so very different from New Orleans.
What he likes best about Mobile, he said, are "the people and the positive attitude toward business development."
Next month International Shipholding will finally get to unveil its newly expanded CG Railway terminal at the state docks, something hurricane issues delayed for three years.
Launched at Choctaw Point in 2000, it was relocated to New Orleans in 2005 when it was displaced by construction of Mobile's $300 million container terminal. But when Hurricane Katrina altered the shipping channel the New Orleans facility relied upon, the CG operation came back to Mobile. The service will have double the capacity it had at Choctaw Point, thanks to a redesigned terminal and vessels.
Johnsen said he's confident both of his double-decker vessels will quickly be filled with rail cars. "Obviously if they weren't, we'd be making a big mistake," he said. "We think the market is there to add capacity."
The terminal will be formally dedicated sometime this summer, he said.
Johnsen said the makeup of the company has shifted somewhat over the past year, with its fleet shrinking from 42 to 26 vessels thanks in large part to International Shipholding's sale last fall of cement subsidiary Belden Shipholding PTE LTD.
Other vessels were sold for scrap, Johnsen said.
International Shipholding also has 15 wholly owned subsidiaries and a stake in three joint ventures.
"We're selling some of the older ships and intend clearly to replace them in the future, so we're really in a sort of transition of getting rid of some of the older stuff, looking at new ventures, and clearly setting ourselves up for the future," Johnsen said.
Such moves are helping International Shipholding toward its goal of getting back on track financially. The company, traded publicly on the New York Stock Exchange under the symbol ISH, posted a healthy fourth-quarter 2006 profit of $21.7 million, or $3.56 per share, on revenue of $58.8 million. In the fourth quarter of 2005, which was affected by Katrina, it lost $825,000, or 13 cents per share, on revenue of $62 million.
The company still needs to add nearly 30 to its staff here, but Johnsen said he has been pleased with the quality and professionalism of the hires thus far. Most, he said, are either local or natives of Alabama who wanted to come home.
Having a major international shipping company based in Mobile adds to the momentum being generated by such developments as the container terminal, said Jimmy Lyons, Alabama State Port Authority director.
Lyons pointed out that International Shipholding owns what's left of former Mobile powerhouse Waterman Steamship Co., and the company's move here means added prestige for Mobile and the port.
"Before all the consolidation in the maritime industry we used to have a lot more stevedoring companies, a lot more agents," Lyons said. "But International Shipholding brings a major player, and that coupled with a lot of other things gives us a lot more notoriety, a lot more attention around the world."
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