Earnings Reports

Kirby Reports Higher Second-Quarter Earnings

In its July 27 second-quarter earnings announcement, Kirby Corporation reported net earnings of $57.4 million, or $0.95 per share, up from $28.5 million or $0.47 per share for the same quarter in 2022. Revenues were $777.2 million, compared with $698 million for the 2022 second quarter.

David Grzebinski, Kirby’s president and CEO, said the Houston-based company saw improvements in both its marine transportation and distribution/services segments. Kirby’s strong free cash flow enabled it to increase share repurchases to $34 million for the quarter, he said.

“In inland marine transportation, our second quarter results reflected continued improvement in pricing together with better weather conditions and operating efficiencies,” Grzebinski said. “From a demand standpoint, customer activity was strong in the quarter with barge utilization rates running in the low 90 percent range. Spot market prices were up in the mid-single digits sequentially and in the mid to high 20 percent range year-over-year. Term contract prices also renewed up higher with low double-digit increases versus a year ago.

“Overall, second quarter inland revenues increased 11 percent year-over-year, and margins were in the high teens range,” he said.

Operating conditions were favorable in the inland market, with limited navigation delays contributing to a 16 percent decrease in delay days year-on-year, the company said.

Kirby’s coastal unit also saw rate increases, although coastal revenues were down slightly, in part because of planned shipyard maintenance on several large vessels, he said.

The inland market represented 82 percent of Kirby’s marine transportation segment revenues in the second quarter.

Commenting on the outlook for the remainder of 2023, Grzebinski said, “We exited the quarter with continued strength in our businesses. Pricing in the marine market continues to improve, and demand is strong. In distribution and services, despite persistent supply chain constraints and delays, demand for our products and services continues to grow, and we continue to receive new orders in manufacturing. Overall, we expect our businesses to deliver improved financial results in the coming quarters. While all of this is encouraging, we are mindful of challenges related to a slowing global economy and additional economic headwinds due to higher interest rates. Also, labor constraints and inflationary pressures continue contributing to rising costs across our businesses, although some of this is starting to moderate. Even with these uncertainties, we remain very positive and expect to drive strong cash flow from operations.”

Kirby expects its capital spending for 2023 will be in the range of $300 million to $380 million. Approximately $240 million is associated with marine maintenance capital and improvements to existing inland and coastal marine equipment, including ballast water treatment systems on some coastal vessels, and facility improvements. Up to approximately $140 million is associated with growth capital spending in the company’s businesses.