July 20, 2000

Kirby Corporation reports strong product volumes
Inland tank barge specialist Kirby Corporation, Houston, reported net earnings for the 2000 second quarter of $9,880,000, or $.40 per share, compared with 1999 second quarter earnings of $6,602,000, or $.33 per share. The 2000 second quarter results included the October 1999 acquisition in of Hollywood Marine, Inc.,

The 2000 second quarter included a $1,035,000 pretax gain ($647,000 after taxes) from the sale of an inland towboat, the result of Kirby's ongoing efforts to optimize horsepower requirements. Kirby also recognized an additional merger related charge of $482,000 ($313,000 after taxes) associated with the early termination of the lease of its former corporate headquarters. The net effect of the gain and the charge increased the 2000 second quarter net earnings by $334,000, or $.01 per share.

Product volumes carried by Kirby remained strong during the 2000 second quarter. Spot market rates were higher than contract rates, and contract renewals generally reflected modest increases. The marine transportation segment's operating margin for the 2000 second quarter was 19.1% compared with 17.9% for the 1999 second quarter.

The 2000 second quarter revenues and operating profits of the diesel engine services segment were 10% below the 1999 second quarter due to softness in its East Coast engine rebuild market, as well as its Midwest marine and rail markets. The segment did benefit from modest improvements from the Gulf Coast drilling and offshore supply vessel market. The segment's operating margin for the 2000 second quarter remained steady at 10.6%.

President and CEO Joe Pyne said "Our second quarter results of $.40 per share are record earnings, reflecting our strong inland markets as well as progress in capturing the operating synergies and efficiencies allowed by the integration of Kirby and Hollywood. We are pleased with our progress to date.''

Kirby operates 774 inland tank barges, with 14.0 million barrels of capacity, and 229 towing vessels, transporting chemicals, petrochemicals, refined petroleum products, black oil and agricultural chemicals throughout the U.S. inland waterway system. Its diesel engine services segment provides after- market service for medium-speed diesels used in marine, power generation and rail applications.

Teekay Shipping income surges
Bahamas-based tanker owner Teekay Shipping Corporation reported net income of $46.7 million, or $1.22 per share, for the quarter ended June 30, 2000, compared to $732,000, or 2 cents per share, for the quarter ended June 30, 1999.

Net voyage revenues for the quarter were $142.6 million, compared to $70.9 million recorded in the same period last year .Income from vessel operations increased to $61.1 million, from $11.9 million. The results for the current quarter reflect an improvement in tanker charter rates and an increase in fleet size as a result of the acquisition of Bona Shipholding Ltd. on June 11, 1999.

Net income for the six months ended June 30, 2000 was $66.7 million, or $1.75 per share, compared to $2.6 million, or 8 cents per share, for the same period last year. Net voyage revenues for the six months ended June 30, 2000 were $262.7 million, compared to $140.9 million in the same period last year, while income from vessel operations increased to $98.9 million from $22.5 million.

Teekay says it benefited from higher Aframax tanker charter rates, which rose throughout the quarter and into July, as oil production increases by the OPEC producers significantly raised the demand for crude oil tankers, while tanker supply remained largely unchanged. Most of the world's spare oil production capacity is currently held by the Middle East OPEC producers. As a result, further production increases would have positive implications for tanker demand, as a high proportion of Middle East oil production is exported via long-haul tanker routes.

During the quarter, Teekay extended three of its five existing time-chartered-in contracts for additional periods ranging from one to four years with options to extend for a further one to two years. In addition, the company entered into a contract to time-charter-in a newbuilding Aframax tanker for a period of three years commencing January 2001. The company also acquired a 1998-built double-hull Aframax tanker at the end of the quarter.

The following is a summary of the Teekay fleet as of this date: 
Type                                         Number          Dwt
----                                         ------          ---
Double-hull or double-sided Aframaxes (1):      39        3,872,600
Single-hull Aframaxes:                          18        1,828,300
Ore/Bulk/Oil Carriers (2):                       8          625,900
Time-chartered-in Aframaxes:                     5          514,000
Other size tankers (3):                          5          670,200
                                             ------       ---------
Total:                                          75        7,511,000
(1) Includes one 50%-owned Aframax tanker.
(2) Includes one 67%-owned OBO carrier & one 52%-owned OBO carrier.
(3) Includes two 50%-owned Suezmax tankers.

Problems with Paradise persist
Carnival Cruise Lines said yesterday that it had canceled two more voyages on its cruise ship Paradise for a total of four scheduled to depart between July 16-August 6, 2000, while the vessel undergoes repairs for a technical problem. As a result, the company estimates that third quarter 2000 earnings will be reduced by approximately three cents per share.

The Paradise departed the Port of Miami July 16 and returned to the same port later that evening with a technical malfunction in one of its Azipod propulsion units. It will now be drydocked at Newport News to undergo repairs and is scheduled to re-enter service on Aug. 13, 2000.

"As technical experts have provided a more detailed assessment of the problem, we unfortunately have determined that the required repair time necessitates the cancelation of these cruises,'' said Bob Dickinson, president of Carnival Cruise Lines.

Hull insurer sets up advisory council
Dex, the recently launched specialist hull insurer, has appointed the first four members of its new Advisory Council. The council is intended to guide the direction of Dex in much the same way as a P&I club is led by a board of directors made up of senior executives drawn from the shipping companies that insure their liabilities with the club.

Dex says it plans to bring to hull insurance, a level of service more commonly found in the P&I world. The creation of the council, which will eventually have a membership of around a dozen individuals, each with a solid background in maritime transport, insurance or an allied discipline, is seen as a key element in the Dex product.Dex was created with the backing of Swiss Re and Trenwick International. It is marketed and managed by Dex Serv, a company jointly owned by Thomas Miller, Swiss Re and Chartwell Managing Agents

The first four members of the AC are Michael Moschos of Levant Maritime International SA, Henry Pfeiff of Hamburg Süd, Norman Baptist of Seatrans, and the Chairman of the Average Adjusters Association, currently Miles Duncan of Richards Hogg Lindley Ltd.

Michael Moschos is managing director of Levant Maritime, one of the first owners to place vessels with Dex, while Henry Pfeiff is Hamburg Süd's director of corporate services and his appointment reflects his broad experience and acknowledges the role he played in the creation of Codex, Dex's rule book. Norman Baptist, who has considerable experience in both shipbroking and marine insurance, is also a director of the UK P&I Club. It is intended that the fourth position on the council will be occupied by the incumbent Chairman of the Average Adjusters Association; the position is normally held for two years and the current Chairman, Miles Duncan, is due to hold office until May 2001.

Dex is underwriting worldwide with the capacity to underwrite 100% lines on ships up to $100 million in value. Dex underwrites on an all-risks basis with clearly explained exclusions, covering hull, increased value, war and loss of income.


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