EXHIBIT 99.1
[KIRBY CORPORATION LOGO]
KIRBY CORPORATION CONTACT: STEVE HOLCOMB
713-435-1135
FOR IMMEDIATE RELEASE
KIRBY CORPORATION ANNOUNCES
2003 SECOND QUARTER RESULTS
o 2003 SECOND QUARTER EARNINGS PER SHARE WERE $.48, A 33% INCREASE
COMPARED WITH $.36 EARNED IN THE 2002 SECOND QUARTER
o RESULTS WERE POSITIVELY IMPACTED BY HIGHER VOLUMES AND IMPROVED
OPERATING CONDITIONS
o 2003 THIRD QUARTER EARNINGS PER SHARE GUIDANCE IS $.42 TO $.46 VERSUS
$.49 EARNED IN THE 2002 THIRD QUARTER, WHICH INCLUDED A $.06 PER
SHARE FAVORABLE ADJUSTMENT TO ACCRUED INSURANCE LIABILITIES
o 2003 YEAR EARNINGS PER SHARE GUIDANCE REMAINS AT $1.65 TO $1.75
HOUSTON, TEXAS (JULY 24, 2003) - Kirby Corporation ("Kirby") (NYSE:KEX) today
announced net earnings for the second quarter ended June 30, 2003 of
$11,789,000, or $.48 per share, compared with $8,756,000, or $.36 per share,
for the second quarter of 2002. Consolidated revenues for the 2003 second
quarter were $158,739,000 compared with $129,478,000 for the 2002 second
quarter. EBITDA per share for the 2003 second quarter was $1.47 compared with
$1.18 for the 2002 second quarter.
Kirby reported net earnings for the first six months of 2003 of $18,657,000, or
$.77 per share, compared with $17,564,000, or $.72 per share, for the first six
months of 2002. Consolidated revenues for the first six months of 2003 were
$306,939,000 compared with $260,915,000 for the first six months of 2002.
EBITDA per share for the first six months of 2003 was $2.57 compared with $2.37
for the same period of 2002.
Marine transportation revenues increased 28% for the 2003 second quarter
compared with the second quarter of 2002, with operating income increasing 35%
during the same period. For the first six months of 2003, marine transportation
revenues increased 21% and operating income increased 10% when compared with
the 2002 first half. The increases reflected the October 2002 transaction with
Coastal Towing, Inc. ("Coastal"), whereby Kirby purchased 10 tank barges and 13
towboats and assumed the management for Coastal's remaining 54 active black oil
tank barges. In addition, the increases reflect the January 2003 purchase of
the inland marine fleet of SeaRiver Maritime, Inc.
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("SeaRiver"), the U.S. marine transportation affiliate of Exxon Mobil
Corporation. The SeaRiver fleet included 48 double hull inland tank barges and
seven towboats, and the assumption of the leases on 16 double hull tank barges.
Kirby also entered into a contract to provide inland marine transportation
services to SeaRiver.
The marine transportation segment benefited from an improved upriver refined
products market, as low Midwest gasoline inventory levels and the Gulf Coast
versus Chicago gasoline price differentials encouraged the movement of Gulf
Coast sourced refined products into the Midwest. The segment was also
positively impacted by stronger volumes of petrochemicals used in the
production of gasoline blending components and the effects of additional
volumes from the SeaRiver acquisition. The demand for black oil products
movements remained strong as residual fuel continued to serve as a substitute
for natural gas and cat cracker feedstock for the production of refined
products. Volumes from the upriver transportation of petrochemicals remained
relatively constant with the 2003 first quarter, but higher than 2002 second
quarter volumes. With natural gas prices remaining high the entire 2003 second
quarter, U.S. production of nitrogen based fertilizer was curtailed, and
volumes of liquid fertilizer moved were lower than in the second quarter of
2002.
The diesel engine services segment's second quarter 2003 revenues were slightly
below 2002 second quarter levels, while operating income for the same quarters
was down 17%. Continued poor offshore oil service and Midwest dry cargo markets
negatively affected the segment. The power generation market benefited from
parts sales to the nuclear industry during the second quarter of 2003.
Joe Pyne, Kirby's President and Chief Executive Officer, commented, "Improved
operating conditions and lower fuel costs helped the second quarter. The
acquisitions of the Coastal and SeaRiver inland tank barge assets continue to
be additive to earnings. Our core petrochemical business remains stable, which
is encouraging, given the apparent decline in rail chemical volumes over most
of the second quarter."
Mr. Pyne further commented, "Looking at anticipated market conditions for the
2003 third quarter, we expect our petrochemical volumes to be stable. With high
natural gas prices, our black oil volumes should remain strong based on the
demand for residual fuel, which serves as a substitute fuel for natural gas. We
anticipate refined products volumes to weaken, due to stable Midwest
inventories. With low Midwest inventories of agricultural chemicals and high
natural gas prices curtailing U.S. fertilizer production, we anticipate the
transportation of fertilizer to improve as domestic production is replaced by
foreign imports."
Further commenting on the third quarter as well as the 2003 year, Mr. Pyne
said, "Based on the above noted market conditions and the continued uncertainty
in the U.S. economy, our earnings per share guidance for the 2003 third quarter
is $.42 to $.46, which includes the effects of Hurricane Claudette, which will
negatively impact our July performance. This guidance compares with $.49 per
share we earned in the 2002 third quarter, which included a $.06 per share
favorable adjustment to accrued insurance liabilities. For the 2003 year, we
are maintaining our earnings per share guidance of $1.65 to $1.75. This
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guidance compares with 2002 net earnings per share of $1.13 per share, which
included $.51 per share of impairment charges."
On May 6, 2003, Kirby announced the signing of a contract with Trinity
Industries, Inc. for the construction of 16 double hull, 30,000 barrel
capacity, inland black oil tank barges, with a total purchase price of
approximately $29,000,000. Seven of the tank barges are anticipated to be
delivered in 2003 and nine in the first half of 2004. Under the barge
management agreement signed with Coastal in October 2002, Coastal had the right
to purchase certain of the new tank barges under construction; however, Coastal
has elected not to replace their tank barges that are currently out-of-service.
Going forward, the tank barge capacity that Coastal removes from service and
does not replace will be replaced by Kirby.
In an effort to provide Kirby's shareholders and potential investors with more
information concerning Kirby, this earnings press release and future earnings
releases will be expanded to include condensed consolidated statements of
earnings, separate marine transportation and diesel engine services statements
of earnings, and marine transportation performance measurements for the 2003
and 2002 second quarters and first six months. The performance measurements
include ton miles, revenues per ton mile, towboats operated and delay days.
Definitions of the performance measurements are included after the measurement
table on page 7 of this press release. Comparable marine transportation
performance measurements by quarter for the 2002 year and the first two
quarters of 2003 are available at Kirby's web site under the caption
Performance Measurements in the Investor Relations section. Kirby's homepage
can be accessed by visiting www.kirbycorp.com.
Kirby has scheduled a conference call at 10:00 a.m. central time today, July
24, 2003, to discuss the 2003 second quarter and first six months, and the
outlook for the 2003 third quarter and full year. The conference call number is
888-390-3403 for domestic callers and 210-839-8505 for international callers.
The passcode is Kirby and the leader's name is Steve Holcomb. An audio playback
will be available starting at approximately 12:00 noon central time on July 24
through 5:00 p.m. on Friday, August 22, 2003, by dialing 888-568-0133 for
domestic callers and 402-530-7800 for international callers. The conference
call can also be accessed by visiting Kirby's homepage at
http://www.kirbycorp.com/ or at http://www.vcall.com/. A replay will be
available on each of those Web Sites following the conference call.
The financial and other information to be discussed in the conference call is
available in this press release and in a Form 8-K filed with the Securities and
Exchange Commission. This press release and the Form 8-K include a non-GAAP
financial measure, EBITDA, which Kirby defines as net earnings before interest
expense, taxes on income, depreciation and amortization. A reconciliation of
EBITDA for the 2003 and 2002 first and second quarters and first six months
with GAAP net earnings for the same periods is included in the Condensed
Consolidated Financial Information in this press release.
Kirby Corporation, based in Houston, Texas, operates inland tank barges and
towing vessels, transporting petrochemicals, black oil products, refined
petroleum products and agricultural chemicals throughout the United States
inland waterway system. Through
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the diesel engine services segment, Kirby provides after-market service for
large medium-speed diesel engines used in marine, power generation and
industrial, and railroad applications.
Statements contained in this press release with respect to the future are
forward-looking statements. These statements reflect management's reasonable
judgment with respect to future events. Forward-looking statements involve
risks and uncertainties. Actual results could differ materially from those
anticipated as a result of various factors, including cyclical or other
downturns in demand, significant pricing competition, unanticipated additions
to industry capacity, changes in the Jones Act or in U.S. maritime policy and
practice, fuel costs, interest rates, weather conditions, and timing, magnitude
and the number of acquisitions made by Kirby. A listing of additional risk
factors can be found in Kirby's annual report on Form 10-K for the year ended
December 31, 2002, filed with the Securities and Exchange Commission.
CONFERENCE CALL INFORMATION
DATE: JULY 24, 2003
TIME: 10:00 A.M. CENTRAL TIME
U.S.: 888-390-3403
INT'L: 210-839-8505
LEADER: STEVE HOLCOMB
PASSCODE: KIRBY
WEBCAST: http://www.kirbycorp.com/ or http://www.vcall.com/
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A summary of the results for the second quarter and first six months follows:
Condensed CONSOLIDATED Statements of Earnings
Second Quarter Six Months
------------------------------ ------------------------------
2003 2002 2003 2002
------------ ------------- ------------- --------------
(unaudited, $ in thousands except per share amounts)
Revenues:
Marine transportation....................................$ 137,156 $ 107,346 $ 262,221 $ 216,336
Diesel engine services................................... 21,583 22,132 44,718 44,579
----------- ------------ ----------- ----------
158,739 129,478 306,939 260,915
----------- ------------ ----------- ----------
Costs and expenses:
Costs of sales and operating expenses.................... 101,153 82,746 202,004 166,216
Selling, general and administrative..................... 18,751 15,488 36,312 32,688
Taxes, other than on income............................. 3,485 2,209 6,536 4,558
Depreciation and other amortization..................... 12,894 11,497 25,126 23,019
Loss (gain) on disposition of assets.................... 126 (27) 133 (168)
----------- ------------ ----------- ----------
136,409 111,913 270,111 226,313
----------- ------------ ----------- ----------
Operating income..................................... 22,330 17,565 36,828 34,602
Equity in earnings of marine affiliates................. 751 137 1,187 940
Other expense........................................... (199) (214) (602) (341)
Interest expense......................................... (3,867) (3,366) (7,321) (6,873)
----------- ------------ ----------- ----------
Earnings before taxes on income...................... 19,015 14,122 30,092 28,328
Provision for taxes on income............................ (7,226) (5,366) (11,435) (10,764)
----------- ------------ ----------- ----------
Net earnings..........................................$ 11,789 $ 8,756 $ 18,657 $ 17,564
=========== ============ =========== ==========
Net earnings per share of common stock:
Basic ...................................................$ .49 $ .36 $ .77 $ .73
Diluted..................................................$ .48 $ .36 $ .77 $ .72
Common stock outstanding (in thousands):
Basic................................................... 24,105 24,146 24,084 24,113
Diluted................................................. 24,412 24,551 24,370 24,549
CONDENSED CONSOLIDATED FINANCIAL INFORMATION
Second Quarter Six Months
------------------------------ ------------------------------
2003 2002 2003 2002
------------ ------------- ------------- -------------
(unaudited, $ in thousands except per share amounts)
EBITDA: (1)
Net earnings.............................................$ 11,789 $ 8,756 $ 18,657 $ 17,564
Interest expense......................................... 3,867 3,366 7,321 6,873
Provision for taxes on income............................ 7,226 5,366 11,435 10,764
Depreciation and other amortization...................... 12,894 11,497 25,126 23,019
----------- ------------ ----------- ----------
$ 35,776 $ 28,985 $ 62,539 $ 58,220
=========== ============ =========== ==========
EBITDA per share - diluted (1)...............................$ 1.47 $ 1.18 $ 2.57 $ 2.37
Capital expenditures.........................................$ 18,971 $ 10,914 $ 37,723 $ 28,234
Acquisition of businesses and marine equipment...............$ 1,500 $ -- $ 37,816 $ 2,800
Long-term debt, including current portion.................................................... $ 295,133 $ 247,769
Stockholders' equity......................................................................... $ 343,026 $ 319,844
Debt to capitalization ratio................................................................. 46.2% 43.7%
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MARINE TRANSPORTATION STATEMENTS OF EARNINGS
Second Quarter Six Months
----------------------------- ---------------------------
2003 2002 2003 2002
------------ ------------- ------------- -----------
(unaudited, $ in thousands)
Marine transportation revenues...............................$ 137,156 $ 107,346 $ 262,221 $ 216,336
---------- ------------ ----------- -----------
Costs and expenses:
Costs of sales and operating expenses.................... 85,050 66,202 168,221 132,649
Selling, general and administrative...................... 14,837 12,141 28,620 25,776
Taxes, other than on income.............................. 3,342 2,104 6,244 4,303
Depreciation and other amortization...................... 12,145 10,716 23,650 21,464
---------- ----------- ----------- -----------
115,374 91,163 226,735 184,192
---------- ----------- ----------- -----------
Operating income......................................$ 21,782 $ 16,183 $ 35,486 $ 32,144
========== =========== =========== ===========
Operating margins..................................... 15.9% 15.1% 13.5% 14.9%
========== =========== =========== ===========
DIESEL ENGINE SERVICES STATEMENTS OF EARNINGS
Second Quarter Six Months
----------------------------- ---------------------------
2003 2002 2003 2002
------------ ------------- ------------- -----------
(unaudited, $ in thousands)
Diesel engine services revenues..............................$ 21,583 $ 22,132 $ 44,718 $ 44,579
---------- ------------ ----------- -----------
Costs and expenses:
Costs of sales and operating expenses.................... 16,076 16,473 33,705 33,432
Selling, general and administrative...................... 2,994 2,780 5,748 5,598
Taxes, other than income................................. 77 62 160 149
Depreciation and amortization............................ 264 208 516 420
---------- ----------- ----------- -----------
19,411 19,523 40,129 39,599
---------- ----------- ----------- -----------
Operating income......................................$ 2,172 $ 2,609 $ 4,589 $ 4,980
========== ============ =========== ===========
Operating margins..................................... 10.1% 11.8% 10.3% 11.2%
========== ============ ============ ============
OTHER COSTS AND EXPENSES
Second Quarter Six Months
----------------------------- ---------------------------
2003 2002 2003 2002
------------ ------------- ------------- -----------
(unaudited, $ in thousands)
General corporate expenses...................................$ 1,498 $ 1,254 $ 3,114 $ 2,690
=========== ============ =========== ===========
Loss (gain) on disposition of assets.........................$ 126 $ (27) $ 133 $ (168)
=========== ============ =========== ===========
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MARINE TRANSPORTATION PERFORMANCE MEASUREMENTS
Second Quarter Six Months
------------------------------ -----------------------------
2003 2002 2003 2002
------------ ------------- ------------ ------------
Ton Miles (in millions) (2)................................. 3,991 3,151 7,446 6,179
Revenue/Ton Mile (cents/tm) (3).............................. 3.4 3.4 3.5 3.5
Towboats operated (average) (4)............................. 226 199 228 202
Delay Days (5)............................................. 1,268 1,355 3,851 3,314
Average cost per gallon of fuel consumed.....................$ .81 $ .72 $ .91 $ .65
Tank barges:
Active .................................................................................. 897 811
Inactive ................................................................................. 76 66
- -----------------------
(1) Kirby has historically evaluated its operating performance using numerous
measures, one of which is EBITDA, a non-GAAP financial measure. Kirby defines
EBITDA as net earnings before interest expense, taxes on income, depreciation
and amortization. EBITDA is presented because of its wide acceptance as a
financial indicator. EBITDA is used by Kirby's lenders in loan covenants, by
rating agencies in determining Kirby's credit rating and by analysts publishing
research reports on Kirby, as well as by investors and investment bankers
generally in valuing companies. EBITDA is not a calculation based on generally
accepted accounting principles and should not be considered as an alternative
to, but should only be considered in conjunction with, Kirby's GAAP financial
information.
(2) Ton miles indicate fleet productivity by measuring the distance (in miles)
a loaded tank barge is moved. Example: A typical 30,000 barrel tank barge
loaded with 3,300 tons of liquid cargo is moved 100 miles, thus generating
330,000 ton miles.
(3) Marine transportation revenues divided by ton miles. Example: Second
quarter 2003 revenues of $137,156,000 divided by 3,991,000,000 ton miles = 3.4
cents.
(4) Towboats operated are the average number of owned and chartered towboats
operated during the period.
(5) Delay days measures the lost time incurred by a tow (towboat and tank
barges) during transit. The measure includes transit delays caused by weather,
lock congestion and other navigational factors.
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