Kirby Corporation Reports Increased Earnings
Kirby Corporation on February 1 announced higher net earnings and revenue for the fourth quarter and full year of 2023, compared to the previous year. As part of the company’s regular financial announcement, the company also reported that Chairman of the Board Joe Pyne will retire in April.
For the fourth quarter, Kirby reported net earnings of $61.9 million or $1.04 per share, compared with $37.9 million and $0.62 per share for the fourth quarter of 2022. Excluding one-time charges in the 2022 fourth quarter, however, net earnings for that period were $40.3 million or $0.67 per share. Consolidated revenues for the 2023 fourth quarter were $799.2 million, compared with $730.2 million for the 2022 fourth quarter.
For the full year of 2023, Kirby reported net earnings of of $222.9 million or $3.72 per share, compared with earnings of $122.3 million or $2.03 per share for 2022. Excluding one-time items in both years, 2023 net earnings were $223.1 million or $3.72 per share, compared with $126.6 million or $2.10 per share in 2022.
Consolidated revenues for 2023 were $3.1 billion compared with $2.8 billion for 2022.
“During the fourth quarter, continued strong fundamentals in both our businesses resulted in significant year-over-year growth in our revenues and earnings,” said David Grzebinski, Kirby president and CEO. “In marine transportation, pricing on spot and term contracts benefited from strong demand and limited availability of barges while the onset of winter weather conditions proved to be a headwind to efficiency in the quarter.
“… In inland marine, we continued to experience strong demand and high barge utilization with our barge utilization rates in the low 90 percent range. Spot market prices continued to push higher and were up in the low to mid-single digits sequentially and in the mid-teens range year-over-year. Pricing increases on term contract renewals were up year-over-year on average in the high-single digits during the quarter. While the efficiency of our operations was challenged during the quarter, with delay days up 86 percent sequentially, strong pricing and utilization mostly offset this, allowing for inland marine margins to remain flat sequentially with operating margins in the high teens on average.”
Grzebinski continued, “In our coastal marine business, we saw consistent customer demand during the fourth quarter that helped maintain barge utilization in the low to mid-90’s. Overall, coastal marine revenues were up 4 percent sequentially as improved spot and term contract pricing more than offset planned maintenance and ballast water treatment installations, which reduced equipment availability. As a result, the coastal business was able to finish the year with operating margins in the low single digits for the quarter.”
Kirby’s marine transportation segment had revenues for the 2023 fourth quarter of $452.6 million compared with $422.7 million for the 2022 fourth quarter. Operating income for the 2023 fourth quarter was $68.2 million compared with $46.7 million for the 2022 fourth quarter. Segment operating margin for the 2023 fourth quarter was 15.1 percent compared with 11.1 percent for the 2022 fourth quarter, the company said.
As of December 31, Kirby Corporation had $32.6 million of cash and cash equivalents on the balance sheet and $491.2 million of available liquidity. Total debt was $1,016.6 million, reflecting a $63.0 million reduction compared to December 31, 2022, and the debt-to-capitalization ratio improved to 24.2 percent, the company said.
Commenting on the 2024 full year outlook, Grzebinski said, “We ended 2023 in a position of strength in both of our segments. In marine transportation, barge utilization and customer demand remain strong, and rates continue to increase. In distribution and services, demand for our products and services remains strong, and we continue to receive new orders in manufacturing. Overall, we anticipate our businesses to deliver 30–40 percent earnings growth in 2024. Key risks putting us at the lower end of this range or below would be the impact from a recession or lingering inflation. Achieving the higher end of this range would be driven by stronger-than-expected chemical markets for marine and stronger-than-expected oil and gas markets for distribution and services.”
Pyne To Retire
In the earnings report, Kirby announced the upcoming retirement of Chairman of the Board Joseph Pyne, who will not stand for re-election after his current term, which ends at the conclusion of Kirby’s 2024 annual stockholders meeting on April 26. Pyne has served as chairman of Kirby since April 2010 and has been a board member for 35 years.
Succeeding Pyne is Richard “Dick” Alario, who has been a board member since 2011. He has been involved with the company and its strategy since joining the board and most recently served as Kirby’s lead independent director since 2021.
“I have been with Kirby 46 years, and it has been a terrific journey,” Pyne said. “Kirby has grown tremendously during my time with the company, and it has done so from the strength of the excellent men and women who dedicate their careers to this great company. The outlook for Kirby is as good as I have ever seen, and I am certain Mr. Alario as chairman, the board, the management team and all the employees will deliver a very bright future.”