Kirby sees favorable outlook for 2023

Written by Nick Blenkey
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Houston-headquartered tank barge giant Kirby Corporation (NYSE: KEX) yesterday reported third and fourth quarter 2022 results that saw earnings for the quarter reach $37.3 million, compared with $11.0 million in the prior year same quarter. For the 2022 full year, Kirby reported net earnings of $122.3 million or $2.03 per share, compared with a net loss of $247 million in 2021.

Kirby President and CEO David Grzebinski commented, “Kirby’s fourth quarter earnings showed significant growth year-over-year driven by improved fundamentals in both businesses. Looking forward into 2023, the outlook for marine transportation and distribution and services is very favorable, and we expect continued growth in earnings during the year.

“In inland marine, we experienced steady market conditions with barge utilization rates in the 90% range and pricing increases on term contract renewals in the low teens year-over-year. As anticipated, the efficiency of our operations declined in the fourth quarter due to low water conditions on the Mississippi River and the onset of winter weather conditions, which contributed to a 147% increase in delay days as compared to the third quarter. Despite these headwinds, inland marine showed continued improvement in margins with operating margin improving into the low teens.”

“In our coastal marine business, overall market conditions remained steady during the fourth quarter with low to mid-90% utilization in barges and continued improvement in spot market and term contract pricing. These trends were partially offset by unfavorable weather conditions and planned maintenance leading to a slight sequential decrease in operating margins into the low single digits.”

Looking ahead to 2023, Grzebinski said, “We exited 2022 with solid strength in our businesses. The marine market remains healthy and we expect favorable market conditions in 2023. Our barge utilization is strong in both inland and coastal, and rates are steadily increasing.”


In inland marine, Kirby’s 2023 outlook anticipates favorable market conditions with continued growth in customer demand, steady volumes from refinery and petrochemical plants, and modest net new barge construction in the industry. These factors are expected to result in barge utilization rates in the low to mid-90% range throughout the year. Overall, inland revenues are expected to grow by low double digits on a full year basis. Barring further cost inflation and rising fuel costs, the company expects operating margins to be in the mid-teens on average for the full year with improvement as the year progresses.


In coastal marine, Kirby expects modestly improved customer demand through the balance of the year with barge utilization in the low to mid-90% range. Rates are expected to continue slowly improving, though meaningful gains remain challenged by underutilized barge capacity across the industry. Revenues and operating margins are expected to be impacted by an approximate doubling of planned shipyard maintenance days with ballast water treatment installations on certain vessels. For the full year, coastal revenues are expected to be flat compared to 2022. Coastal operating margins are expected to near break-even to low single digits on a full year basis.”

You can read Grzebinski’s full remarks and get all the numbers HERE


You can also, courtesy of Seeking Alpha, read a transcript of Kirby’s conference call with financial analysts. Among the interesting snippets to emerge from that is Grzebinski’s comments on an analyst’s remark that there were just 22 tank barges built last year industry-wide.

“Yes, that’s about right,” said Grzebinski. “The order book from what we hear is anemic and we don’t see anybody building. Now there could be some people that tied up some barges during the pandemic and there may be some of those coming back. But again, I think you see a net decline in barges in 2023.”

Read the conference call transcript HERE

Categories: Coastal, Inland, News Tags: ,