UNITED
STATES SECURITIES AND EXCHANGE COMMISSION
Washington,
D.C. 20549
Form
8-K
CURRENT
REPORT
PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
Date
of report (Date of earliest event reported): January 28,
2009
Kirby
Corporation
(Exact
name of registrant as specified in its charter)
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Nevada
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1-7615
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74-1884980
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(State
or other jurisdiction of incorporation or organization)
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(Commission
File Number)
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(I.R.S.
Employer Identification No.)
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55
Waugh Drive, Suite 1000
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77007
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Houston,
Texas
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(Zip
Code)
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(Address
of principal executive offices)
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Registrant’s
telephone number, including area code:
(713)
435-1000
Check the
appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
£ Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
£ Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
£ Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
£ Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
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Item
2.02.
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Results
of Operations and Financial
Condition
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On
January 28, 2009 Kirby Corporation (“Kirby”) issued a press release announcing
earnings for the three months and year ended December 31, 2008. A
copy of the press release is attached as Exhibit 99.1 to this
report.
EBITDA, a
non-GAAP financial measure, is used in the press release. Kirby
defines EBITDA as net earnings before interest expense, taxes on income,
depreciation and amortization. Kirby has historically evaluated its
operating performance using numerous measures, one of which is
EBITDA. EBITDA is presented because of its wide acceptance as a
financial indicator. EBITDA is one of the performance measures used
in Kirby’s incentive bonus plan. EBITDA is also used 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. A quantitative reconciliation of
EBITDA to GAAP net earnings for the 2008 and 2007 fourth quarters and years is
included in the press release.
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Item
9.01.
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Financial
Statements and Exhibits
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(c)
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Exhibits:
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99.1
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Press
release dated January 28, 2009
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SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the Registrant has
duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
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KIRBY
CORPORATION
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|||
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(Registrant)
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|||
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By:
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/s/ Norman W. Nolen
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Norman
W. Nolen
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Executive
Vice President, Treasurer
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and
Chief Financial Officer
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Dated: January
29, 2009
EXHIBIT
INDEX
Exhibit 99.1 Press release dated January
28, 2009
Exhibit 99.1
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KIRBY
CORPORATION
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Contact: Steve
Holcomb
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713-435-1135
FOR IMMEDIATE
RELEASE
KIRBY
CORPORATION ANNOUNCES RECORD
2008
FOURTH QUARTER AND YEAR RESULTS
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·
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2008 fourth quarter earnings
per share were $.72, a 13% increase compared with $.64 earned in the 2007
fourth quarter, and included a $6.0 million before taxes, or $.07 per
share, increase in allowance for doubtful
accounts
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|
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·
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2008 year earnings per share
were $2.91, a 27% increase over the $2.29 earned in
2007
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·
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2009 first quarter earnings per
share guidance is $.45 to $.55 versus $.68 earned in the 2008 first
quarter
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·
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2009 first quarter guidance
includes a $.03 to $.06 per share negative diesel fuel price impact and a
$.05 per share charge for early retirements and staff
reductions
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·
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2009 year earnings per share
guidance is $2.40 to $2.65 versus $2.91 earned in
2008
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Houston, Texas (January 28,
2009) – Kirby Corporation (“Kirby”) (NYSE:KEX) today announced record net
earnings for the fourth quarter ended December 31, 2008 of $38.4 million, or
$.72 per share, compared with net earnings of $34.4 million, or $.64 per share,
for the 2007 fourth quarter. The 2008 fourth quarter net earnings
included a $6.0 million before taxes, or $.07 per share, increase in Kirby’s
allowance for doubtful accounts. Consolidated revenues for the 2008
fourth quarter were a record $326.7 million, an increase of 6% over the $307.9
million reported for the 2007 fourth quarter.
“While
our fourth quarter results mark the 20th
consecutive quarter that our net earnings exceeded the same quarter of the
previous year, both our marine transportation and diesel engine services markets
weakened as the economic downturn began to impact our customers,” said Joe Pyne,
Kirby’s President and Chief Executive Officer. “In our marine
transportation segment, demand was weakest in our upriver markets but was
partially offset by time charter contracts, lower fuel costs and lower operating
costs as we responded to the changing economic conditions. We also
increased our general reserve for doubtful accounts by $6.0 million in the
fourth quarter due to the deteriorating economic environment. Our
diesel engine services segment’s fourth quarter results reflected a weaker
medium-speed market and continued weakness in our high-speed
market.”
1
Kirby
reported record net earnings for the 2008 year of $157.2 million, or $2.91 per
share, a 27% increase compared with $123.3 million, or $2.29 per share, for
2007. Consolidated revenues for the 2008 year were a record $1.36
billion, a 16% increase compared with $1.17 billion for 2007. The
Company’s debt to capitalization ratio declined from 27.9% to 21.7% during
2008.
Marine
Transportation Operating Results
Marine
transportation operating income for the 2008 fourth quarter was $62.2 million, a
15% increase compared with the fourth quarter of 2007, and revenues were $265.5
million, a 7% increase compared with the 2007 fourth quarter. Demand
for the upriver movements of petrochemicals weakened during the quarter while
demand in the Gulf Intracoastal Waterway remained consistent with third quarter
levels. In addition to the $.07 per share negative impact from the
increase in the allowance for doubtful accounts, the fourth quarter results also
reflected a $.06 per share benefit from the timing impact of falling diesel fuel
prices, which declined from an average price of $3.99 per gallon consumed in the
2008 third quarter to an average of $2.59 per gallon consumed in the 2008 fourth
quarter. The 2008 fourth quarter operating margin was 23.4% compared
with 21.8% for the 2007 fourth quarter, reflecting higher term contract pricing
implemented throughout 2008, reduced number of charter boats operated and lower
fuel costs, partially offset by the increase in the allowance for doubtful
accounts.
Diesel
Engine Services Operating Results
Diesel
engine services operating income for the 2008 fourth quarter was $7.5 million, a
19% decrease compared with the fourth quarter of 2007, and revenues
were $61.2 million, a 3% increase compared with the 2007 fourth
quarter. Demand levels for service and direct parts sales weakened in
the fourth quarter in the medium-speed market as its customers’ activities
slowed, particularly in the power generation and railroad markets. The
high-speed market, which had been impacted by lower Gulf of Mexico oil services
activity during the 2008 first nine months, improved in the fourth quarter as
customers recovered from the disruptions of Hurricanes Gustav and
Ike. The diesel engine services operating margin was 12.3% for the
2008 fourth quarter compared with 15.6% for the 2007 fourth quarter and 15.0%
for the 2008 year compared with 15.6% for 2007. The reduced
fourth quarter operating margin reflected lower labor utilization and higher
equipment sales, which had lower operating margins.
2009
First Quarter and Year Outlook
Commenting
on the 2009 first quarter guidance, Mr. Pyne said, “The global recession has
limited our visibility for 2009 volumes and we are providing a wider quarterly
and annual earnings guidance range until we can forecast with a higher level of
confidence. For the 2009 first quarter our earnings guidance is $.45
to $.55 per share, reflecting a 19% to 34% decrease compared with $.68 per share
for the 2008 first quarter, as demand is anticipated to remain
weak. The 2009 first quarter guidance includes an estimated $.03 to
$.06 per share negative diesel fuel price impact. The guidance also
includes an estimated $.05 per share charge for early retirement and staff
reductions, as we respond to a lower demand and service
environment.”
Commenting
on the 2009 year, Mr. Pyne said, “For the 2009 year, our earnings guidance is
$2.40 to $2.65 per share, reflecting a 9% to 18% decrease from 2008 net earnings
of $2.91 per share. Our 2009 capital spending guidance range is $185
to $195 million, including approximately $140 million for the construction of 48
new tank barges and five towboats.”
2
Conference
Call
A
conference call is scheduled at 10:00 a.m. central time tomorrow, Thursday,
January 29, 2009, to discuss the 2008 fourth quarter and year performance as
well as the outlook for the 2009 first quarter and year. The
conference call number is 888-328-2514 for domestic callers and 706-679-3262 for
international callers. The leader’s name is Steve
Holcomb. An audio playback will be available at 1:00 p.m. central
time on Thursday, January 29, through 6:00 p.m. central time on Friday, February
27, by dialing 800-642-1687 for domestic and 706-645-9291 for international
callers. The conference ID number is 80621376. A live
audio webcast of the conference call will be available to the public and a
replay available after the call by visiting Kirby’s web site at http://www.kirbycorp.com/.
GAAP
to Non-GAAP Financial Measures
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 with GAAP net earnings is included in this press
release. This earnings press release also includes marine
transportation performance measures, consisting of ton miles, revenue per ton
mile, towboats operated and delay days. Comparable performance
measures for the 2008 and 2007 years and quarters are available at Kirby’s web
site, http://www.kirbycorp.com/,
under the caption Performance Measurements in the Investor Relations
section.
About
Kirby Corporation
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. Kirby also owns and operates four ocean-going barge and tug
units transporting dry-bulk commodities in United States coastwise
trade. Through the diesel engine services segment, Kirby provides
after-market service for medium-speed and high-speed diesel engines and
reduction gears used in marine, power generation 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 number of acquisitions made by Kirby. Forward-looking statements
are based on currently available information and Kirby assumes no obligation to
update any such statements. A list of additional risk factors can be
found in Kirby’s annual report on Form 10-K for the year ended December 31, 2007
filed with the Securities and Exchange Commission.
3
A summary
of the results for the fourth quarter and year follows:
CONDENSED CONSOLIDATED
STATEMENTS OF EARNINGS
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Fourth Quarter
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Year
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|||||||||||||||
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2008
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2007
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2008
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2007
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|||||||||||||
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(unaudited,
$ in thousands except per share amounts)
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||||||||||||||||
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Revenues:
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||||||||||||||||
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Marine
transportation
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$ | 265,461 | $ | 248,695 | $ | 1,095,475 | $ | 928,834 | ||||||||
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Diesel
engine services
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61,216 | 59,155 | 264,679 | 243,791 | ||||||||||||
| 326,677 | 307,850 | 1,360,154 | 1,172,625 | |||||||||||||
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Costs
and expenses:
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||||||||||||||||
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Costs
of sales and operating expenses
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193,830 | 192,882 | 843,310 | 735,427 | ||||||||||||
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Selling,
general and administrative
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39,822 | 30,665 | 142,171 | 121,952 | ||||||||||||
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Taxes,
other than on income
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2,572 | 3,533 | 13,120 | 13,159 | ||||||||||||
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Depreciation
and amortization
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24,067 | 20,642 | 91,199 | 80,916 | ||||||||||||
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Loss
(gain) on disposition of assets
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134 | (148 | ) | (142 | ) | 383 | ||||||||||
| 260,425 | 247,574 | 1,089,658 | 951,837 | |||||||||||||
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Operating
income
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66,252 | 60,276 | 270,496 | 220,788 | ||||||||||||
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Other
expense
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(719 | ) | (215 | ) | (1,820 | ) | (672 | ) | ||||||||
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Interest
expense
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(3,399 | ) | (4,458 | ) | (14,064 | ) | (20,284 | ) | ||||||||
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Earnings
before taxes on income
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62,134 | 55,603 | 254,612 | 199,832 | ||||||||||||
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Provision
for taxes on income
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(23,725 | ) | (21,251 | ) | (97,444 | ) | (76,491 | ) | ||||||||
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Net
earnings
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$ | 38,409 | $ | 34,352 | $ | 157,168 | $ | 123,341 | ||||||||
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Net
earnings per share of common stock:
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||||||||||||||||
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Basic
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$ | .72 | $ | .65 | $ | 2.94 | $ | 2.33 | ||||||||
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Diluted
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$ | .72 | $ | .64 | $ | 2.91 | $ | 2.29 | ||||||||
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Common
stock outstanding (in thousands):
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||||||||||||||||
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Basic
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53,067 | 53,123 | 53,397 | 52,978 | ||||||||||||
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Diluted
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53,548 | 53,925 | 54,020 | 53,764 | ||||||||||||
CONDENSED CONSOLIDATED
FINANCIAL INFORMATION
|
Fourth Quarter
|
Year
|
|||||||||||||||
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2008
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2007
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2008
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2007
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|||||||||||||
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(unaudited,
$ in thousands)
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||||||||||||||||
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EBITDA: (1)
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||||||||||||||||
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Net
earnings
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$ | 38,409 | $ | 34,352 | $ | 157,168 | $ | 123,341 | ||||||||
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Interest
expense
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3,399 | 4,458 | 14,064 | 20,284 | ||||||||||||
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Provision
for taxes on income
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23,725 | 21,251 | 97,444 | 76,491 | ||||||||||||
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Depreciation
and amortization
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24,067 | 20,642 | 91,199 | 80,916 | ||||||||||||
| $ | 89,600 | $ | 80,703 | $ | 359,875 | $ | 301,032 | |||||||||
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Capital
expenditures
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$ | 31,494 | $ | 41,056 | $ | 173,019 | $ | 164,083 | ||||||||
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Acquisitions
of businesses and marine equipment
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$ | 44 | $ | 5,419 | $ | 5,480 | $ | 67,185 | ||||||||
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December 31,
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||||||||
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2008
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2007
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|||||||
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(unaudited,
$ in thousands)
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||||||||
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Long-term
debt, including current portion
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$ | 247,307 | $ | 297,383 | ||||
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Stockholders’
equity
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$ | 890,053 | $ | 769,830 | ||||
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Debt
to capitalization ratio
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21.7 | % | 27.9 | % | ||||
4
MARINE TRANSPORTATION
STATEMENTS OF EARNINGS
|
Fourth Quarter
|
Year
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|||||||||||||||
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2008
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2007
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2008
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2007
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|||||||||||||
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(unaudited,
$ in thousands)
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||||||||||||||||
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Marine
transportation revenues
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$ | 265,461 | $ | 248,695 | $ | 1,095,475 | $ | 928,834 | ||||||||
|
Costs
and expenses:
|
||||||||||||||||
|
Costs
of sales and operating expenses
|
149,995 | 151,470 | 657,078 | 562,769 | ||||||||||||
|
Selling,
general and administrative
|
28,578 | 20,658 | 96,960 | 82,454 | ||||||||||||
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Taxes,
other than on income
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2,293 | 3,287 | 12,034 | 12,188 | ||||||||||||
|
Depreciation
and amortization
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22,424 | 19,111 | 84,537 | 75,311 | ||||||||||||
| 203,290 | 194,526 | 850,609 | 732,722 | |||||||||||||
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Operating
income
|
$ | 62,171 | $ | 54,169 | $ | 244,866 | $ | 196,112 | ||||||||
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Operating
margins
|
23.4 | % | 21.8 | % | 22.4 | % | 21.1 | % | ||||||||
DIESEL ENGINE SERVICES
STATEMENTS OF EARNINGS
|
Fourth Quarter
|
Year
|
|||||||||||||||
|
2008
|
2007
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2008
|
2007
|
|||||||||||||
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(unaudited,
$ in thousands)
|
||||||||||||||||
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Diesel
engine services revenues
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$ | 61,216 | $ | 59,155 | $ | 264,679 | $ | 243,791 | ||||||||
|
Costs
and expenses:
|
||||||||||||||||
|
Costs
of sales and operating expenses
|
43,835 | 41,412 | 186,232 | 172,658 | ||||||||||||
|
Selling,
general and administrative
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8,508 | 7,116 | 33,014 | 28,196 | ||||||||||||
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Taxes,
other than income
|
259 | 218 | 1,016 | 856 | ||||||||||||
|
Depreciation
and amortization
|
1,115 | 1,157 | 4,830 | 4,133 | ||||||||||||
| 53,717 | 49,903 | 225,092 | 205,843 | |||||||||||||
|
Operating
income
|
$ | 7,499 | $ | 9,252 | $ | 39,587 | $ | 37,948 | ||||||||
|
Operating
margins
|
12.3 | % | 15.6 | % | 15.0 | % | 15.6 | % | ||||||||
OTHER COSTS AND
EXPENSES
|
Fourth Quarter
|
Year
|
|||||||||||||||
|
2008
|
2007
|
2008
|
2007
|
|||||||||||||
|
(unaudited,
$ in thousands)
|
||||||||||||||||
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General
corporate expenses
|
$ | 3,284 | $ | 3,293 | $ | 14,099 | $ | 12,889 | ||||||||
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Loss
(gain) on disposition of assets
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$ | 134 | $ | (148 | ) | $ | (142 | ) | $ | 383 | ||||||
5
MARINE TRANSPORTATION
PERFORMANCE MEASUREMENTS
|
Fourth Quarter
|
Year
|
|||||||||||||||
|
2008
|
2007
|
2008
|
2007
|
|||||||||||||
|
Ton
Miles (in millions) (2)
|
3,292 | 4,206 | 14,267 | 16,716 | ||||||||||||
|
Revenue/Ton
Mile (cents/tm) (3)
|
7.7 | 5.7 | 7.3 | 5.3 | ||||||||||||
|
Towboats
operated (average) (4)
|
250 | 258 | 256 | 253 | ||||||||||||
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Delay
Days (5)(5)
|
1,926 | 2,311 | 8,267 | 8,157 | ||||||||||||
|
Average
cost per gallon of fuel consumed
|
$ | 2.59 | $ | 2.49 | $ | 3.21 | $ | 2.10 | ||||||||
|
Tank
barges:
|
||||||||||||||||
|
Active
|
914 | 913 | ||||||||||||||
|
Inactive
|
73 | 53 | ||||||||||||||
|
Barrel
capacities (in millions):
|
||||||||||||||||
|
Active
|
17.5 | 17.3 | ||||||||||||||
|
Inactive
|
1.3 | .9 | ||||||||||||||
|
(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 one of the performance measures used in
Kirby’s incentive bonus plan. EBITDA is also used 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)
|
Inland
marine transportation revenues divided by ton
miles. Example: Fourth quarter 2008 inland marine
revenues of $252,719,000 divided by 3,292,000,000 marine transportation
ton miles = 7.7 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 one or more
tank barges) during transit. The measure includes transit
delays caused by weather, lock congestion and other navigational
factors.
|
6