Kirby reports Q2 EPS 95c, consensus 85c

Reports Q2 revenue $777.2M, consensus $780.19M. David Grzebinski, Kirby’s CEO, commented, “Both of our segments continued to perform well during the quarter and produced higher revenue and operating income sequentially and year-over-year. In marine transportation, pricing on spot and term contracts continued to benefit from strong demand and limited availability of barges. Favorable weather conditions and increased operating efficiency helped improve margins for both inland and coastal. Distribution and services delivered improved margins and business remains stable at a high level. Overall, we had solid results and we generated strong free cash flow which helped support an increase in our share repurchases to $34 million for the quarter. “In inland marine transportation, our second quarter results reflected continued improvement in pricing together with better weather conditions and operating efficiencies. From a demand standpoint, customer activity was strong in the quarter with barge utilization rates running in the low 90% range. Spot market prices were up in the mid-single digits sequentially and in the mid to high 20% 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% year-over-year and margins were in the high teens range. In coastal, market fundamentals continued to improve with our barge utilization levels running in the mid to high-90% range. During the quarter, we saw solid customer demand and limited availability of large capacity vessels which resulted in high-teens price increases year-over-year on term contract renewals and increases on new spot deals in the high 20% range. As mentioned on our first quarter call, our results this year are being impacted by planned shipyard maintenance on several large vessels. Overall, second quarter coastal revenues decreased slightly year-over-year but operating margins were positive in the low single digits. In distribution and services, demand remained steady across our markets with continued new orders combined with high levels of backlog. In manufacturing, revenues were up sequentially and year-over-year driven by healthy demand for our environmentally friendly pressure pumping equipment and power generation equipment for e-frac. In our commercial and industrial market, overall demand remained solid across our different businesses, with growth coming from the marine repair, power generation, and on-highway sectors.”