10-Q
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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

Form 10-Q

 

Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2023

or

Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

 

Commission File Number: 1-7615

 

KIRBY CORPORATION

(Exact name of registrant as specified in its charter)

 

 

Nevada

74-1884980

(I.R.S. Employer Identification No.)

(State or other jurisdiction of incorporation or organization)

 

55 Waugh Drive, Suite 1000

Houston, TX

77007

(Address of principal executive offices)

(Zip Code)

 

713-435-1000

(Registrant’s telephone number, including area code)

 

No Change

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

Trading Symbol(s)

Name of each exchange on which registered

Common Stock

KEX

New York Stock Exchange

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No

 

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulations S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes No

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

Accelerated filer

Non-accelerated filer

 

Smaller reporting company

 

 

Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No

 

As of November 3, 2023, 59.1 million shares of the Registrant’s $0.10 par value per share common stock were outstanding.

 

 

 


 

PART I – FINANCIAL INFORMATION

Item 1. Financial Statements

KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES

CONDENSED BALANCE SHEETS

(Unaudited)

 

 

September 30,
2023

 

 

December 31,
2022

 

 

 

($ in thousands)

 

ASSETS

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

$

42,116

 

 

$

80,577

 

Accounts receivable:

 

 

 

 

 

 

Trade – less allowance for doubtful accounts

 

 

514,631

 

 

 

483,406

 

Other

 

 

53,936

 

 

 

114,556

 

Inventories – net

 

 

505,506

 

 

 

461,848

 

Prepaid expenses and other current assets

 

 

79,382

 

 

 

71,372

 

Total current assets

 

 

1,195,571

 

 

 

1,211,759

 

 

 

 

 

 

 

 

Property and equipment

 

 

5,710,443

 

 

 

5,452,143

 

Accumulated depreciation

 

 

(1,928,319

)

 

 

(1,818,681

)

Property and equipment – net

 

 

3,782,124

 

 

 

3,633,462

 

 

 

 

 

 

 

 

Operating lease right-of-use assets

 

 

155,098

 

 

 

154,507

 

Goodwill

 

 

438,748

 

 

 

438,748

 

Other intangibles, net

 

 

45,058

 

 

 

51,463

 

Other assets

 

 

66,281

 

 

 

64,985

 

Total assets

 

$

5,682,880

 

 

$

5,554,924

 

 

 

 

 

 

 

 

LIABILITIES AND STOCKHOLDERS’ EQUITY

 

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Bank notes payable

 

$

9,608

 

 

$

3,292

 

Income taxes payable

 

 

2,247

 

 

 

323

 

Accounts payable

 

 

258,126

 

 

 

278,081

 

Accrued liabilities

 

 

199,124

 

 

 

204,752

 

Current portion of operating lease liabilities

 

 

32,170

 

 

 

36,444

 

Deferred revenues

 

 

134,577

 

 

 

119,305

 

Total current liabilities

 

 

635,852

 

 

 

642,197

 

 

 

 

 

 

 

 

Long-term debt, net – less current portion

 

 

1,058,248

 

 

 

1,076,326

 

Deferred income taxes

 

 

672,711

 

 

 

625,884

 

Operating lease liabilities – less current portion

 

 

142,237

 

 

 

142,140

 

Other long-term liabilities

 

 

15,750

 

 

 

23,209

 

Total long-term liabilities

 

 

1,888,946

 

 

 

1,867,559

 

 

 

 

 

 

 

 

Contingencies and commitments

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity:

 

 

 

 

 

 

Kirby stockholders’ equity:

 

 

 

 

 

 

Common stock, $0.10 par value per share. Authorized 120 million shares, issued 65.5 million shares

 

 

6,547

 

 

 

6,547

 

Additional paid-in capital

 

 

861,928

 

 

 

859,345

 

Accumulated other comprehensive income – net

 

 

19,078

 

 

 

16,853

 

Retained earnings

 

 

2,629,759

 

 

 

2,468,730

 

Treasury stock – at cost, 6.2 million shares at September 30, 2023 and 5.6 million at December 31, 2022

 

 

(360,420

)

 

 

(308,598

)

Total Kirby stockholders’ equity

 

 

3,156,892

 

 

 

3,042,877

 

Noncontrolling interests

 

 

1,190

 

 

 

2,291

 

Total equity

 

 

3,158,082

 

 

 

3,045,168

 

Total liabilities and equity

 

$

5,682,880

 

 

$

5,554,924

 

 

See accompanying notes to condensed financial statements.

 

2


 

KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES

CONDENSED STATEMENTS OF EARNINGS

(Unaudited)

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

 

 

($ in thousands, except per share amounts)

 

Revenues:

 

 

 

 

 

 

 

 

 

 

 

 

Marine transportation

 

$

429,885

 

 

$

433,040

 

 

$

1,269,342

 

 

$

1,194,231

 

Distribution and services

 

 

334,887

 

 

 

312,803

 

 

 

1,023,122

 

 

 

860,358

 

Total revenues

 

 

764,772

 

 

 

745,843

 

 

 

2,292,464

 

 

 

2,054,589

 

 

 

 

 

 

 

 

 

 

 

 

 

Costs and expenses:

 

 

 

 

 

 

 

 

 

 

 

 

Costs of sales and operating expenses

 

 

530,541

 

 

 

552,392

 

 

 

1,618,690

 

 

 

1,526,872

 

Selling, general and administrative

 

 

79,125

 

 

 

75,381

 

 

 

250,870

 

 

 

221,721

 

Taxes, other than on income

 

 

9,666

 

 

 

9,121

 

 

 

28,610

 

 

 

28,332

 

Depreciation and amortization

 

 

53,445

 

 

 

50,419

 

 

 

156,251

 

 

 

150,498

 

Gain on disposition of assets

 

 

(1,528

)

 

 

(377

)

 

 

(4,230

)

 

 

(7,971

)

Total costs and expenses

 

 

671,249

 

 

 

686,936

 

 

 

2,050,191

 

 

 

1,919,452

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating income

 

 

93,523

 

 

 

58,907

 

 

 

242,273

 

 

 

135,137

 

Other income

 

 

1,589

 

 

 

3,805

 

 

 

9,296

 

 

 

11,853

 

Interest expense

 

 

(13,386

)

 

 

(11,755

)

 

 

(38,893

)

 

 

(32,598

)

 

 

 

 

 

 

 

 

 

 

 

 

Earnings before taxes on income

 

 

81,726

 

 

 

50,957

 

 

 

212,676

 

 

 

114,392

 

Provision for taxes on income

 

 

(18,722

)

 

 

(11,713

)

 

 

(51,733

)

 

 

(28,956

)

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings

 

 

63,004

 

 

 

39,244

 

 

 

160,943

 

 

 

85,436

 

Net (earnings) loss attributable to noncontrolling interests

 

 

(40

)

 

 

(153

)

 

 

86

 

 

 

(454

)

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings attributable to Kirby

 

$

62,964

 

 

$

39,091

 

 

$

161,029

 

 

$

84,982

 

 

 

 

 

 

 

 

 

 

 

 

 

Net earnings per share attributable to Kirby common stockholders:

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

$

1.06

 

 

$

0.65

 

 

$

2.70

 

 

$

1.41

 

Diluted

 

$

1.05

 

 

$

0.65

 

 

$

2.68

 

 

$

1.41

 

 

See accompanying notes to condensed financial statements.

 

3


 

KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES

CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

 

 

 

Three Months Ended September 30,

 

 

Nine Months Ended September 30,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

 

 

($ in thousands)

 

Net earnings

 

$

63,004

 

 

$

39,244

 

 

$

160,943

 

 

$

85,436

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income, net of taxes:

 

 

 

 

 

 

 

 

 

 

 

 

Pension and postretirement benefits

 

 

(61

)

 

 

9,110

 

 

 

1,152

 

 

 

13,254

 

Foreign currency translation adjustments

 

 

143

 

 

 

(608

)

 

 

1,073

 

 

 

(743

)

Total other comprehensive income, net of taxes

 

 

82

 

 

 

8,502

 

 

 

2,225

 

 

 

12,511

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total comprehensive income, net of taxes

 

 

63,086

 

 

 

47,746

 

 

 

163,168

 

 

 

97,947

 

Net (earnings) loss attributable to noncontrolling interests

 

 

(40

)

 

 

(153

)

 

 

86

 

 

 

(454

)

 

 

 

 

 

 

 

 

 

 

 

 

 

Comprehensive income attributable to Kirby

 

$

63,046

 

 

$

47,593

 

 

$

163,254

 

 

$

97,493

 

 

See accompanying notes to condensed financial statements.

 

4


 

KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES

CONDENSED STATEMENTS OF CASH FLOWS
(Unaudited)

 

 

 

Nine Months Ended September 30,

 

 

 

2023

 

 

2022

 

 

 

($ in thousands)

 

Cash flows from operating activities:

 

 

 

 

 

 

Net earnings

 

$

160,943

 

 

$

85,436

 

Adjustments to reconcile net earnings to net cash provided by operations:

 

 

 

 

 

 

Depreciation and amortization

 

 

156,251

 

 

 

150,498

 

Provision for deferred income taxes

 

 

46,441

 

 

 

25,986

 

Amortization of share-based compensation

 

 

12,310

 

 

 

11,448

 

Amortization of major maintenance costs

 

 

21,050

 

 

 

21,677

 

Other

 

 

(8,001

)

 

 

(7,608

)

Decrease in cash flows resulting from changes in operating assets and liabilities, net

 

 

(64,767

)

 

 

(126,252

)

Net cash provided by operating activities

 

 

324,227

 

 

 

161,185

 

 

 

 

 

 

 

Cash flows from investing activities:

 

 

 

 

 

 

Capital expenditures

 

 

(274,963

)

 

 

(120,263

)

Acquisitions of businesses and marine equipment

 

 

(37,500

)

 

 

(3,900

)

Proceeds from disposition of assets

 

 

21,846

 

 

 

32,904

 

Net cash used in investing activities

 

 

(290,617

)

 

 

(91,259

)

 

 

 

 

 

 

Cash flows from financing activities:

 

 

 

 

 

 

Borrowings on bank credit facilities, net

 

 

100,316

 

 

 

21,664

 

Borrowings on long-term debt

 

 

240,000

 

 

 

250,000

 

Payments on long-term debt

 

 

(350,000

)

 

 

(315,000

)

Payment of debt issuance costs

 

 

(1,237

)

 

 

(1,538

)

Proceeds from exercise of stock options

 

 

3,431

 

 

 

3,885

 

Payments related to tax withholding for share-based compensation

 

 

(3,598

)

 

 

(3,193

)

Treasury stock purchases

 

 

(60,910

)

 

 

(22,901

)

Return of investment to noncontrolling interest and other

 

 

(73

)

 

 

(665

)

Net cash used in financing activities

 

 

(72,071

)

 

 

(67,748

)

Increase (decrease) in cash and cash equivalents

 

 

(38,461

)

 

 

2,178

 

 

 

 

 

 

 

Cash and cash equivalents, beginning of year

 

 

80,577

 

 

 

34,813

 

Cash and cash equivalents, end of period

 

$

42,116

 

 

$

36,991

 

 

 

 

 

 

 

Supplemental disclosures of cash flow information:

 

 

 

 

 

 

Cash paid (received) during the period:

 

 

 

 

 

 

Interest paid

 

$

45,276

 

 

$

39,754

 

Income taxes paid (refunded), net

 

$

(67,118

)

 

$

2,097

 

Operating cash outflow from operating leases

 

$

33,266

 

 

$

33,412

 

Non-cash investing activity:

 

 

 

 

 

 

Capital expenditures included in accounts payable

 

$

(2,305

)

 

$

(8,508

)

Right-of-use assets obtained in exchange for lease obligations

 

$

32,652

 

 

$

14,329

 

 

See accompanying notes to condensed financial statements.

 

5


 

KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES

CONDENSED STATEMENTS OF STOCKHOLDERS’ EQUITY

(Unaudited)

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Paid-in-

 

 

Comprehensive

 

 

Retained

 

 

Treasury Stock

 

 

Noncontrolling

 

 

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Income, Net

 

 

Earnings

 

 

Shares

 

 

Amount

 

 

Interests

 

 

Total

 

 

(in thousands)

 

Balance at June 30, 2023

 

65,472

 

 

$

6,547

 

 

$

857,965

 

 

$

18,996

 

 

$

2,566,795

 

 

 

(5,946

)

 

$

(339,659

)

 

$

2,165

 

 

$

3,112,809

 

Stock option exercises

 

 

 

 

 

 

 

574

 

 

 

 

 

 

 

 

 

48

 

 

 

2,739

 

 

 

 

 

 

3,313

 

Issuance of stock for equity awards, net of forfeitures

 

 

 

 

 

 

 

(9

)

 

 

 

 

 

 

 

 

 

 

 

9

 

 

 

 

 

 

 

Tax withholdings on equity award vesting

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2

)

 

 

 

 

 

(2

)

Amortization of unearned share-based compensation

 

 

 

 

 

 

 

3,398

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

3,398

 

Treasury stock purchases

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(291

)

 

 

(23,310

)

 

 

 

 

 

(23,310

)

Excise taxes on treasury stock purchases

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(197

)

 

 

 

 

 

(197

)

Total comprehensive income, net of taxes

 

 

 

 

 

 

 

 

 

 

82

 

 

 

62,964

 

 

 

 

 

 

 

 

 

40

 

 

 

63,086

 

Return of investment to noncontrolling interests

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1,015

)

 

 

(1,015

)

Balance at September 30, 2023

 

65,472

 

 

$

6,547

 

 

$

861,928

 

 

$

19,078

 

 

$

2,629,759

 

 

 

(6,189

)

 

$

(360,420

)

 

$

1,190

 

 

$

3,158,082

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Additional

 

 

Other

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Paid-in-

 

 

Comprehensive

 

 

Retained

 

 

Treasury Stock

 

 

Noncontrolling

 

 

 

 

 

Shares

 

 

Amount

 

 

Capital

 

 

Income, Net

 

 

Earnings

 

 

Shares

 

 

Amount

 

 

Interests

 

 

Total

 

 

(in thousands)

 

Balance at June 30, 2022

 

65,472

 

 

$

6,547

 

 

$

854,781

 

 

$

(21,957

)

 

$

2,392,330

 

 

 

(5,501

)

 

$

(304,314

)

 

$

2,357

 

 

$

2,929,744

 

Amortization of unearned share-based compensation

 

 

 

 

 

 

 

2,893