Core Viewpoint - Kirby reported strong Q2 2025 earnings with GAAP EPS of $1.67 and revenue of $855.5 million, exceeding analyst expectations, but management expressed caution regarding future demand uncertainties [1][5][12] Financial Performance - Q2 2025 GAAP EPS was $1.67, up 17% from $1.43 in Q2 2024 [2] - Total GAAP revenue reached $855.5 million, a 3.8% increase from $824.4 million in Q2 2024 [2] - Operating margin improved to 15.4%, up from 14.6% in Q2 2024 [2] - EBITDA increased to $202.2 million, a 10.6% rise from $182.9 million in Q2 2024 [2] - Free cash flow significantly decreased to $22.5 million from $90.7 million in Q2 2024, a decline of 75.2% [2][7] Business Overview - Kirby holds approximately 27% of the U.S. inland tank barge market and 11% of the coastal market, operating over 1,100 inland and 28 coastal tank barges [3] - The company focuses on marine transportation of bulk liquids and industrial equipment repair and parts distribution [3] Key Success Factors - Kirby's success is driven by scale in marine services, regulatory compliance, and diversification into industrial equipment sales [4] - Demand for petrochemicals and petroleum, along with tight shipyard capacity, are critical for performance [4] Segment Performance - Marine transportation revenue rose 1.6% to $492.6 million, with operating income increasing 4.4% and margins reaching 20.1% [6] - Distribution and Services revenue increased by 6.9% to $362.9 million, with power generation revenue up 31% year-over-year [7] Industry Dynamics - Kirby's operations are influenced by the Jones Act, which protects the tank barge industry from foreign competition [10] - High steel prices and labor shortages limit rapid fleet expansion, with new orders primarily for replacement rather than growth [11] Future Guidance - Management expects FY2025 EPS growth of 15% to 25%, but cautioned about potential softness in demand [12] - Marine transportation utilization is projected to dip into the low 90% range in Q3 2025 [12] - Distribution and Services revenue is expected to be flat or slightly up, with operating margins in the high single digits [13]

[Overall Performance Summary](index=1&type=section&id=Overall%20Performance%20Summary) Kirby Corporation reported solid Q2 2025 results with net earnings of $94.3 million and consolidated revenues of $855.5 million, driven by strong performance across both marine transportation and distribution and services segments Q2 2025 Key Financial Results | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | **Revenues** | $855.5M | $824.4M | +3.8% | | **Net Earnings** | $94.3M | $83.9M | +12.4% | | **Diluted EPS** | $1.67 | $1.43 | +16.8% | - The strong quarterly performance was attributed to healthy customer demand, disciplined pricing, and operational focus across both primary business segments[3](index=3&type=chunk) - The company repurchased **331,900 shares** of its common stock during the quarter for **$31.2 million**, at an average price of **$94.01 per share**[4](index=4&type=chunk)[12](index=12&type=chunk) [Segment Performance](index=3&type=section&id=Segment%20Performance) Both Marine Transportation and Distribution and Services segments achieved year-over-year growth in revenue and operating income, driven by strong utilization, higher pricing, and robust power generation demand [Marine Transportation](index=3&type=section&id=Marine%20Transportation) The Marine Transportation segment's revenue increased to $492.6 million with a 20.1% operating margin, driven by strong utilization and price increases in both inland and coastal markets Marine Transportation Performance (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | **Revenues** | $492.6M | $484.8M | | **Operating Income** | $99.1M | $94.9M | | **Operating Margin** | 20.1% | 19.6% | - Inland market: Barge utilization was in the **low to mid-90% range**. Term contracts renewed with **low to mid-single-digit price increases** year-over-year[3](index=3&type=chunk)[6](index=6&type=chunk) - Coastal market: Barge utilization was strong, in the **mid to high-90% range**. Term contract renewals saw significant price increases in the **mid-20% range** compared to the prior year[3](index=3&type=chunk)[7](index=7&type=chunk) [Distribution and Services](index=3&type=section&id=Distribution%20and%20Services) Distribution and Services revenue grew to $362.9 million with a 9.8% operating margin, primarily due to a 31% increase in power generation revenue, despite a decline in the oil and gas market Distribution and Services Performance (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | **Revenues** | $362.9M | $339.6M | | **Operating Income** | $35.4M | $29.4M | | **Operating Margin** | 9.8% | 8.7% | - Power generation revenue increased **31% YoY**, driven by robust demand from data centers and industrial customers, representing **39% of segment revenue**[3](index=3&type=chunk)[9](index=9&type=chunk) - Commercial and industrial revenue grew **5% YoY**, supported by marine repair and modest on-highway service improvement[10](index=10&type=chunk) - Oil and gas operating income increased **182% YoY** despite a **27% revenue decline**, attributed to cost management and growth in e-frac equipment sales[3](index=3&type=chunk)[11](index=11&type=chunk) [Cash Flow and Financial Position](index=3&type=section&id=Cash%20Flow%20and%20Financial%20Position) Kirby generated $202.2 million in EBITDA and $94.0 million in net cash from operations in Q2 2025, maintaining a solid financial position with $331.5 million in liquidity and a 24.8% debt-to-capitalization ratio Q2 2025 Financial Position & Cash Flow | Metric | Q2 2025 | | :--- | :--- | | **EBITDA** | $202.2M | | **Net Cash from Operations** | $94.0M | | **Capital Expenditures** | $71.5M | | **Share Repurchases** | $31.2M | | **Cash and Cash Equivalents** | $68.4M | | **Total Debt** | $1,117.8M | | **Debt-to-Capitalization Ratio** | 24.8% | [2025 Full-Year Outlook](index=3&type=section&id=2025%20Outlook) Kirby reaffirms its 2025 earnings growth forecast of 15% to 25% YoY, with results likely at the lower end due to trade policy complexities and mixed segment outlooks - The company expects full-year 2025 earnings growth to be between **15% and 25% YoY**, but cautions that results will likely be at the **lower end of this range** if current softness caused by trade policy complexities persists[13](index=13&type=chunk) - Inland marine operating margins are expected to remain in the **20% range**, though barge utilization has softened slightly to the **low 90% range** for Q3[14](index=14&type=chunk) - Coastal marine fundamentals remain strong, with utilization expected in the **mid-90% range** and operating margins in the **mid to high teens**[15](index=15&type=chunk) - For Distribution and Services, full-year revenue is now expected to be **flat to slightly up**, with operating margins in the **high-single digits**[16](index=16&type=chunk) 2025 Full-Year Guidance | Metric | Projected Range | | :--- | :--- | | **Net Cash from Operations** | $620M - $720M | | **Capital Spending** | $260M - $290M | [Financial Statements and Reconciliations](index=7&type=section&id=Financial%20Statements%20and%20Reconciliations) This section presents detailed unaudited financial tables for Q2 and H1 2025, including consolidated and segment earnings, EBITDA and free cash flow reconciliations, balance sheet data, and marine operational metrics [Condensed Consolidated Statements of Earnings](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Earnings) The company's consolidated revenues for Q2 2025 were $855.5 million, leading to an operating income of $131.8 million and net earnings attributable to Kirby of $94.3 million, or $1.67 per diluted share Condensed Consolidated Statements of Earnings (Q2 2025 vs Q2 2024, in thousands) | Description | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | **Total revenues** | **$855,455** | **$824,390** | | Operating income | $131,846 | $120,498 | | Earnings before taxes on income | $123,928 | $110,767 | | **Net earnings attributable to Kirby** | **$94,277** | **$83,854** | | Diluted EPS | $1.67 | $1.43 | [Condensed Consolidated Financial Information](index=7&type=section&id=Condensed%20Consolidated%20Financial%20Information) This section reconciles net earnings to EBITDA, showing Q2 2025 EBITDA at $202.2 million. It also presents key balance sheet figures as of June 30, 2025, including $68.4 million in cash and a debt-to-capitalization ratio of 24.8% EBITDA Reconciliation (Q2 2025, in thousands) | Description | Amount | | :--- | :--- | | Net earnings attributable to Kirby | $94,277 | | Interest expense | $12,730 | | Provision for taxes on income | $29,550 | | Depreciation and amortization | $65,670 | | **EBITDA** | **$202,227** | Balance Sheet Highlights (as of June 30, 2025, in thousands) | Description | Amount | | :--- | :--- | | Cash and cash equivalents | $68,383 | | Long-term debt | $1,117,765 | | Total equity | $3,389,890 | | Debt to capitalization ratio | 24.8% | [Segment Statements of Earnings](index=8&type=section&id=Segment%20Statements%20of%20Earnings) Provides a detailed earnings breakdown for each segment. For Q2 2025, Marine Transportation generated $99.1 million in operating income on $492.6 million in revenue (20.1% margin). Distribution and Services generated $35.4 million in operating income on $362.9 million in revenue (9.8% margin) Marine Transportation Statement of Earnings (Q2 2025, in thousands) | Description | Amount | | :--- | :--- | | Revenues | $492,562 | | **Operating income** | **$99,052** | | Operating margin | 20.1% | Distribution and Services Statement of Earnings (Q2 2025, in thousands) | Description | Amount | | :--- | :--- | | Revenues | $362,893 | | **Operating income** | **$35,435** | | Operating margin | 9.8% | [Other Financial Data](index=9&type=section&id=Other%20Financial%20Data) This section includes a reconciliation of free cash flow and key performance metrics for the marine business. For Q2 2025, free cash flow was $22.5 million. Inland ton miles increased year-over-year, while revenue per ton mile decreased Reconciliation of Free Cash Flow (Q2 2025, in millions) | Description | Amount | | :--- | :--- | | Net cash provided by operating activities | $94.0 | | Less: Capital expenditures | $(71.5) | | **Free cash flow** | **$22.5** | Inland Performance Measurements (Q2 2025 vs Q2 2024) | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Ton Miles (in millions) | 3,659 | 3,330 | | Revenue/Ton Mile (cents/tm) | 10.9 | 11.8 | | Towboats operated (average) | 290 | 287 |

Financial Data and Key Metrics Changes - The company reported second quarter earnings per share of $1.67, a 17% increase year over year from $1.43 in 2024 [5] - Total Marine revenues increased by $7.8 million or 2% compared to 2024, and operating income increased by $4.2 million or 4% [13] - Distribution and Services segment revenues were $363 million with operating income of $35 million and operating margin of 9.8% [19] Business Line Data and Key Metrics Changes - Inland marine transportation saw barge utilization rates in the low to mid 90% range, with pricing gains and operating margins in the low 20% range [6][7] - Coastal marine transportation revenues increased 3% year over year and 14% sequentially, with operating margins in the high teens [17] - Power generation revenues increased 31% year over year, driven by robust demand from data centers and industrial customers [9] Market Data and Key Metrics Changes - Spot market rates increased in the low single digits sequentially and in the mid single digits year over year [7] - Average coastal barge utilization was in the mid to high 90% range, reflecting strong customer demand [8] - The oil and gas segment experienced a 27% year over year decline in revenues, although operating income increased significantly due to cost management [22] Company Strategy and Development Direction - The company aims to maintain capital discipline while pursuing long-term value creation through strategic investments and acquisitions [30] - There is a focus on adapting to macroeconomic conditions and maintaining strong operational performance despite challenges [28] - The company anticipates continued growth in inland marine revenues in the low to mid single digits for the full year [31] Management's Comments on Operating Environment and Future Outlook - Management noted that the macro environment has become more complex, with trade policy shifts introducing uncertainty [28] - Despite some demand softness, the company expects 15% to 25% year over year growth in earnings for 2025 [29] - The outlook for the power generation segment remains strong, with a growing backlog and increased orders [53] Other Important Information - The company expects to generate cash flow from operations of $620 million to $720 million for 2025 [25] - Capital expenditures are projected to range between $60 million and $290 million for the year, with some growth initiatives deferred to 2026 [26] - The company has a strong balance sheet with $68 million in cash and total debt of approximately $1.12 billion [23] Q&A Session Summary Question: Update on inland business demand and spot pricing - Management indicated that while the second quarter was strong, there are signs of demand pullback in July, particularly from chemical customers [40][41] Question: Clarification on growth guidance and margin impacts - Management stated that if demand remains muted, they may finish closer to the lower end of their guidance range, but there is potential for recovery [61][62] Question: Insights on power generation segment and backlog - Management confirmed that the power generation segment is seeing strong demand, with a backlog increase of 15% to 20% [52][105] Question: Discussion on capital allocation between M&A and stock buybacks - Management expressed a preference for stock buybacks in the absence of acquisitions, while remaining open to potential M&A opportunities [78][80] Question: Inquiry about the frac market and power generation quotes - Management noted that most power generation orders are now coming from data centers, with a significant increase in inquiries compared to previous periods [104][106]

Financial Data and Key Metrics Changes - The company reported second quarter earnings per share of $1.67, a 17% increase year over year from $1.43 in 2024 [5] - Total Marine Transportation segment revenues were $493 million with an operating income of $99 million, resulting in an operating margin of 20.1% [14] - Distribution and Services segment revenues were $363 million with an operating income of $35 million, yielding an operating margin of 9.8% [20] Business Line Data and Key Metrics Changes - Inland marine transportation saw barge utilization rates in the low to mid 90% range, with revenues increasing 1% year over year due to improved pricing [16] - Coastal marine transportation revenues increased 3% year over year and 14% sequentially, with operating margins in the high teens [17][19] - Power generation revenues increased 31% year over year, driven by strong demand from data centers and industrial customers [10] Market Data and Key Metrics Changes - Spot market rates increased in the low single digits sequentially and in the mid single digits year over year, supported by limited barge availability [7] - The inland fleet had over 1,100 barges representing 24.5 million barrels of capacity, with expectations to end 2025 with 1,110 inland barges [19] - The oil and gas segment experienced a 27% year over year decline in revenues, although operating income increased significantly due to cost management [23] Company Strategy and Development Direction - The company aims to maintain capital discipline while pursuing long-term value creation through strategic investments and acquisitions [31] - The outlook for inland marine is positive due to limited new barge construction, although some price moderation is expected [32] - The company plans to use free cash flow primarily for share repurchases, absent any acquisitions [80] Management's Comments on Operating Environment and Future Outlook - Management noted that the macro environment has become more complex, with trade policy shifts introducing uncertainty [29] - Despite challenges, the company expects 15% to 25% year over year growth in earnings for 2025, with potential adjustments based on demand trends [30] - The company remains confident in its ability to adapt and execute, with a strong balance sheet and solid free cash flow generation [31] Other Important Information - The company expects to unwind some working capital as the year progresses, with capital expenditures projected between $60 million and $290 million for the year [26] - The backlog in power generation projects increased by 15% to 20% in the second quarter, indicating strong future demand [53] Q&A Session Summary Question: Insights on inland business demand and spot pricing - Management acknowledged a slight pullback in chemical customer volumes but maintained a cautious outlook for the third quarter with expected barge utilization around 90% [41][42] Question: Update on power generation segment performance - The strong performance was attributed to deliveries and a growing backlog, with expectations for continued strong shipments in the third quarter [51][52] Question: Clarification on capital expenditures and M&A strategy - The company plans to defer some growth-related capital expenditures into 2026 while focusing on stock buybacks in the absence of acquisitions [78][80] Question: Outlook on inland and coastal margins - Management indicated that while inland margins are expected to remain in the low 20% range, coastal margins are anticipated to improve significantly due to supply constraints [66][67]

Core Insights - Kirby (KEX) reported quarterly earnings of $1.67 per share, exceeding the Zacks Consensus Estimate of $1.59 per share, and up from $1.43 per share a year ago, representing an earnings surprise of +5.03% [1] - The company posted revenues of $855.46 million for the quarter ended June 2025, which missed the Zacks Consensus Estimate by 3.34%, compared to $824.39 million in the same quarter last year [2] - Kirby has surpassed consensus EPS estimates in all four of the last quarters, but has only topped revenue estimates once during the same period [2] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $1.85 on revenues of $888.02 million, and for the current fiscal year, it is $6.48 on revenues of $3.45 billion [7] - The estimate revisions trend for Kirby was favorable ahead of the earnings release, resulting in a Zacks Rank 2 (Buy) for the stock, indicating expected outperformance in the near future [6] Industry Context - The Transportation - Shipping industry, to which Kirby belongs, is currently ranked in the top 39% of over 250 Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8] - Empirical research indicates a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Financial Performance - Kirby's Q2 2025 revenues increased by 4% year-over-year to $855.5 million[5] - Operating income for Q2 2025 rose by 9% year-over-year to $131.8 million[5] - Net earnings attributable to Kirby in Q2 2025 increased by 12% year-over-year to $94.3 million[5] - Earnings per share for Q2 2025 increased by 17% year-over-year to $1.67[5] - Kirby repurchased $31 million of its stock during the quarter[6] Marine Transportation - Inland marine transportation contributed 81% of marine transportation revenues[21] - Coastal marine transportation contributed 19% of marine transportation revenues[21] - Inland barge utilization was in the low to mid-90% range[21] - Coastal barge utilization was in the mid to high-90% range[21] - Term contract renewals for inland were up in the low to mid-single digits year-over-year[11] - Term contract renewals for coastal were up in the mid-20% range year-over-year[11] Distribution & Services - Distribution & Services revenues increased by 7% year-over-year to $362.9 million[25] - Power generation revenues increased by 31% year-over-year[17] - Oil and Gas revenues decreased by 27% year-over-year[17] Balance Sheet and Liquidity - Total debt stood at $1.1 billion as of June 30, 2025[30] - Available liquidity was $332 million as of June 30, 2025[30]

Core Insights - Kirby Corporation reported net earnings of $94.3 million or $1.67 per share for Q2 2025, an increase from $83.9 million or $1.43 per share in Q2 2024, with consolidated revenues rising to $855.5 million from $824.4 million year-over-year [1][2]. Financial Performance - Marine transportation revenues for Q2 2025 were $492.6 million, up from $484.8 million in Q2 2024, with operating income increasing to $99.1 million from $94.9 million, resulting in an operating margin of 20.1% compared to 19.6% in the previous year [3][6]. - Distribution and services revenues rose to $362.9 million from $339.6 million year-over-year, with operating income increasing to $35.4 million from $29.4 million, leading to an operating margin of 9.8%, up from 8.7% [7][9]. Segment Analysis - In inland marine transportation, barge utilization rates remained steady in the low to mid-90% range, with average spot market rates increasing in the low-single digits sequentially and mid-single digits year-over-year [4][5]. - Coastal marine conditions were strong, with barge utilization in the mid to high-90% range and term contract renewals increasing in the mid-20% range compared to the previous year [5][6]. - Power generation revenues increased by 31% year-over-year, driven by robust demand from data centers and industrial customers, while oil and gas revenues declined by 27% but operating income surged by 182% due to strong execution and cost management [8][10]. Cash Flow and Capital Management - For Q2 2025, EBITDA was reported at $202.2 million, up from $182.9 million in Q2 2024, with net cash provided by operating activities at $94.0 million and capital expenditures at $71.5 million [11][24]. - The company repurchased 331,900 shares at an average price of $94.01, totaling $31.2 million during the quarter [5][11]. Outlook - Kirby expects 15% to 25% year-over-year growth in earnings for the full year 2025, although recent trade policy shifts may impact near-term planning and demand [12][15]. - The company anticipates continued strong performance in power generation, while the oil and gas segment may face constraints due to current market conditions [15][16].

Core Viewpoint - Kirby Corporation (KEX) is positioned as an impressive investment option due to multiple favorable factors impacting its performance [1]. Performance Overview - KEX has shown a strong price trend, gaining 32% over the past three months, outperforming the Zacks Transportation - Shipping industry's growth of 19.8% [2][7]. Investment Ratings - Kirby holds a Zacks Rank of 2 (Buy) and a VGM Score of B, indicating strong investment potential [4]. Earnings Performance - KEX has a positive earnings surprise history, exceeding the Zacks Consensus Estimate in the last four quarters with an average beat of 5.02% [5]. - Earnings for Q2 2025 are projected to grow by 11.19% year over year, while the overall earnings for 2025 are expected to increase by 18.38% year over year [5][7]. Industry Context - The industry rank for Kirby is 29 out of 245, placing it in the top 12% of Zacks Industries, which is crucial for stock performance [8]. Growth Drivers - Kirby is experiencing favorable market conditions, including higher pricing, increased barge utilization, and improved pricing in both inland and coastal markets [9]. Financial Health - As of Q1 2025, Kirby reported cash and cash equivalents of $51 million against a current debt level of $7 million, indicating strong liquidity [10]. - The current ratio stands at 1.58, higher than the previous quarter's 1.45 and the industry average of 1.31, suggesting a lower risk of default [10]. Shareholder Returns - Kirby has been actively repurchasing shares, having bought back 1.6 million shares for $174.6 million in 2024 and 1.25 million shares for $124.7 million as of April 30, 2025 [11].

Company Overview - In 2024, Marine Transportation accounted for 59% of Kirby's revenues, totaling $1.913 billion[5] - Distribution and Services contributed 41% of the 2024 revenues, amounting to $1.353 billion[7] - As of March 31, 2025, Kirby's market capitalization stood at $5.889 billion, with net debt at $1.047 billion, resulting in an enterprise value of $6.936 billion[13] Marine Transportation - Kirby's inland share of the barge market is 28% as of March 31, 2025[48] - Petrochemicals and Chemicals account for 50% of Marine Transportation revenue, followed by Black Oil at 25%, Refined Petroleum Products at 22%, and Agricultural Chemicals at 3%[49] - The inland tank barge fleet has grown annually at approximately 2% over the last 20 years but has remained flat over the last 5 years[59] - In 2024, Kirby achieved 99.95% Safe Watches[40] Distribution & Services - Power Generation accounts for 34% of Distribution & Services segment revenues, while Commercial & Industrial contributes 52%, and Oil & Gas accounts for 14%[93, 95] - Power Generation is expected to be approximately 40% of the segment revenues in 2025[122] - Commercial and industrial is expected to be approximately 40-45% of the segment revenues in 2025[122] - Oil and gas is expected to be approximately 15-20% of the segment revenues in 2025[122] Financial Performance - In Q1 2025, Kirby's revenues were $785.7 million, a 3% decrease compared to $808.0 million in Q1 2024[113] - Q1 2025 earnings per share were $1.33, a 12% increase compared to $1.19 in Q1 2024[113]

Company Overview - Kirby Corporation is the largest domestic tank barge operator in the United States, specializing in the transportation of bulk liquid products across various waterways including the Mississippi River System and the Gulf Intracoastal Waterway [4] - The company operates through two main segments: marine transportation (KMT) and distribution and services (KDS) [4] - KMT focuses on transporting petrochemicals, black oil, refined petroleum products, and agricultural chemicals, while KDS provides after-market services and equipment rentals for various industrial applications [4] Upcoming Financial Announcement - Kirby Corporation will announce its 2025 second quarter results on July 31, 2025, at 6:00 a.m. CDT, followed by an earnings conference call at 7:30 a.m. CDT [1] - Financial information discussed during the conference call will be available in a press release and a Form 8-K posted on Kirby's website prior to the call [3] Participation Information - Listeners wishing to participate in the Q&A session via telephone must pre-register to receive dial-in information and a PIN [2] - A replay of the webcast will be accessible for one year on Kirby's Investor Relations website [2]