Moody's cuts International Shipholding

Moody's Investors Service said it downgraded the debt ratings of International Shipholding Corp., including the corporate family rating to B2 from B1 and the senior unsecured rating to Caa1 from B1.

The outlook has been changed to negative from stable.

Moody's said these downgrades were prompted by operating losses in the company's liner and rail-ferry segments during a period of significant capital expenditures, including for the soon-to-be-abandoned rail-ferry terminal in New Orleans (moving to the Port of Mobile, Ala.).

Free cash flow over the near term is likely to be modest, in Moody's view, because of continuing weak performance in the liner and rail-ferry units as well as capital spending that remains high by historic levels.

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