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 26, 2005
KIRBY CORPORATION
(Exact name of registrant as specified in its charter)
NEVADA 1-7615 74-1884980
(State or other jurisdiction of (Commission File Number) (I.R.S. Employer
incorporation or organization) Identification No.)
55 WAUGH DRIVE, SUITE 1000 77007
HOUSTON, TEXAS (Zip Code)
(Address of principal executive offices)
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))
Item 2.02. Results of Operations and Financial Condition
On January 26, 2005, Kirby Corporation ("Kirby") issued a press release
announcing earnings for the three months and year ended December 31, 2004. 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 2004 and 2003 fourth
quarters and years is included in the press release.
Item 9.01. Financial Statements and Exhibits
(c) Exhibits:
99.1 Press release dated January 26, 2005
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.
KIRBY CORPORATION
(Registrant)
By:
------------------------------------
Norman W. Nolen
Executive Vice President, Treasurer
and Chief Financial Officer
Dated: January 27, 2005
EXHIBIT INDEX
Exhibit 99.1 Press release dated January 26, 2005
[GRAPHIC OMITED]
KIRBY
KIRBY CORPORATION CONTACT: STEVE HOLCOMB
713-435-1135
FOR IMMEDIATE RELEASE
- ---------------------
KIRBY CORPORATION ANNOUNCES RECORD RESULTS
FOR THE 2004 FOURTH QUARTER AND YEAR
- 2004 FOURTH QUARTER EARNINGS PER SHARE WERE $.53, UP 18% COMPARED WITH
$.45 EARNED IN THE 2003 FOURTH QUARTER
- 2004 YEAR EARNINGS PER SHARE WERE $1.97, UP 18% COMPARED WITH $1.67
EARNED IN THE 2003 YEAR
- 2005 FIRST QUARTER EARNINGS PER SHARE GUIDANCE IS $.42 TO $.48
COMPARED WITH $.36 EARNED IN THE 2004 FIRST QUARTER
- 2005 YEAR EARNINGS PER SHARE GUIDANCE IS $2.20 TO $2.30 VERSUS $1.97
EARNED IN THE 2004 YEAR
HOUSTON, TEXAS (JANUARY 26, 2005) - Kirby Corporation ("Kirby") (NYSE:KEX) today
announced record net earnings for the fourth quarter ended December 31, 2004 of
$13,496,000, a 22% increase compared with $11,050,000 for the fourth quarter of
2003. On a diluted per share basis, 2004 fourth quarter earnings were $.53, up
18% from $.45 for the 2003 fourth quarter. Kirby's published earnings guidance
range for the 2004 fourth quarter was $.50 to $.54 per share. Consolidated
revenues for the 2004 fourth quarter were $173,739,000, a 14% increase compared
with $152,028,000 for the 2003 fourth quarter.
Kirby also reported record net earnings for the 2004 year of $49,544,000, a 21%
increase compared with $40,918,000 for the 2003 year. Diluted earnings per
share for the 2004 year were $1.97, up 18% from $1.67 for the 2003 year.
Kirby's latest published earnings guidance range for the 2004 year was $1.94 to
$1.98 per share. Consolidated revenues for the 2004 year were $675,319,000, a
10% increase compared with $613,474,000 for the 2003 year.
The marine transportation segment's revenues increased 13% for the 2004 fourth
quarter and 11% for the 2004 year when compared with the 2003 fourth quarter and
year. Operating income increased 18% for the 2004 fourth quarter and 20% for
the 2004 year when compared with the 2003 corresponding periods. The results
for both periods reflected improved petrochemical and black oil product volumes
when compared with the
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prior year periods. As a result of the increased volumes, the segment was
successful in modestly increasing contract rates during the year and spot market
rates were generally higher than contract rates for most markets. Operating
margins for the 2004 fourth quarter improved to 16.4% compared with 15.7% for
the 2003 fourth quarter and for the 2004 year improved to 15.7% compared with
14.6% for the 2003 year.
The diesel engine services segment reported a 24% increase in revenues and a 21%
increase in operating income for the 2004 fourth quarter when compared with the
2003 fourth quarter. For the 2004 year, revenues increased 4% and operating
income rose 6% when compared with 2003. The higher 2004 fourth quarter and year
results were primarily from increased direct parts sales to nuclear power
generation and rail customers, and the acquisition of the diesel engine service
operation and parts inventory of Walker Paducah Corp. in April 2004. Also, the
East Coast, West Coast and Midwest marine markets strengthened during the 2004
fourth quarter. The Gulf Coast offshore oil and gas services market remained
weak during all of 2004. The lower operating margin for the 2004 fourth quarter
reflected an increase in direct parts sales, as parts sales typically earn a
lower margin than service work.
Kirby reported record EBITDA of $38.7 million for the 2004 fourth quarter and
$148.3 million for the 2004 year. Capital expenditures for 2004 totaled $93.6
million, including $42.7 million for new tank barges, which replace older tank
barges removed from service, and $50.9 million principally for upgrading the
existing marine transportation fleet. Acquisitions of businesses and marine
equipment for 2004 were $11.5 million, including $4.2 million for a one-third
interest in Osprey Line and $5.8 million for the acquisition from Walker.
Outstanding debt at December 31, 2004 was $218.7 million, 14% lower than the
$255.3 million reported at December 31, 2003. Kirby's debt-to-capitalization
ratio at December 31, 2004 declined to 33.4% compared with 40.7% at December 31,
2003.
Joe Pyne, Kirby's President and Chief Executive Officer, commented, "2004 was a
record setting year for Kirby. Revenues, net earnings, earnings per share, and
EBITDA were at the highest levels in Kirby's history. The principal
contributing factor to our success was the improved U.S. and global economies.
As a result of the improved economies, our core petrochemical market, which
represented 68% of our 2004 marine transportation revenue, reflected increased
volumes as our petrochemical customers increased their production. Our black
oil market also remained strong the entire year. Our upriver refined products
market was generally at traditional levels throughout the year, while our
agricultural chemical market was weak for the entire year, but reflected some
improvement in the fourth quarter."
Mr. Pyne continued, "Our record 2004 results were not achieved without some
challenges. We incurred record navigational delay days, including key lock
closures for repairs, high water conditions, principally during the second and
fourth quarters, Hurricane Ivan in September, and a significant number of fog
days along the Gulf Coast in February, March, November and December. Delay days
for the 2004 year were 30% higher than 2003, while the 2004 fourth quarter delay
days were 59% higher than the fourth quarter of 2003."
Page 2 of 7
Commenting on the 2005 guidance, Mr. Pyne said, "We are forecasting net earnings
for the 2005 first quarter in the $.42 to $.48 per share range compared with net
earnings of $.36 per share reported for the 2004 first quarter. We have a wider
earnings guidance range for the first quarter, as our first quarter results are
more volatile due to the probability of increased delay days, the result of high
or low water conditions, ice conditions in the Midwest and fog along the Gulf
Coast. These conditions result in longer transit times and the operation of
additional towboats to meet customer demands. Our 2005 first quarter guidance
range is based on firm petrochemical and black oil volumes, normal seasonal
upriver refined products volumes, and some improvement in agricultural chemical
volumes."
Mr. Pyne further commented, "For the 2005 year, Kirby's earnings per share
guidance is $2.20 to $2.30. The guidance range includes an estimated $.04 per
share of expense assuming the adoption, effective July 1, 2005, of the fair
value method of accounting for stock-based employee compensation. Capital
spending guidance for 2005 is $110 to $120 million and includes approximately
$65 million for the construction of 18 double hull 30,000 barrel capacity inland
tank barges and 20 double hull 10,000 barrel capacity inland tank barges. The
$65 million estimate for the construction of new tank barges is subject to the
fluctuation of steel prices."
This earnings press release includes marine transportation performance measures
for both the 2004 and 2003 periods. The performance measures include ton miles,
revenues per ton mile, towboats operated and delay days. Comparable performance
measures for the 2003 and 2002 years and quarters are available at Kirby's web
site under the caption Performance Measurements in the Investor Relations
section. Kirby's homepage can be accessed by visiting www.kirbycorp.com.
-----------------
A conference call is scheduled at 10:00 a.m. central time tomorrow, Thursday,
January 27, 2005, to discuss the 2004 fourth quarter and full year, and the
outlook for the 2005 first quarter and full 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
approximately 11:00 a.m. central time on January 27 through 6:00 p.m. on Friday,
February 25, 2005, by dialing 800-642-1687 for domestic callers and 706-645-9291
for international callers. The conference ID number is 3552716. The conference
call can also be accessed by visiting Kirby's homepage at
http://www.kirbycorp.com/ or at http://audioevent.mshow.com/209520. A replay
- ------------------------ ----------------------------------
will be available on each of those web sites following the conference call.
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 for the 2004 and 2003 fourth quarters and full years to GAAP net earnings
for the same periods is included in the Condensed Consolidated Financial
Information in this press release.
Kirby Corporation, based in Houston, Texas, operates inland tank barges and
towing vessels, transporting petrochemicals, black oil products, refined
petroleum products and
Page 3 of 7
agricultural chemicals throughout the United States inland waterway system.
Through the diesel engine services segment, Kirby provides after-market service
for large medium-speed diesel engines used in marine, power generation and
industrial, 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 the number of acquisitions made by Kirby. A listing of additional risk
factors can be found in Kirby's annual report on Form 10-K for the year ended
December 31, 2003, filed with the Securities and Exchange Commission.
CONFERENCE CALL INFORMATION
DATE: THURSDAY, JANUARY 27, 2005
TIME: 10:00 A.M. CENTRAL TIME
U.S.: 888-328-2514
INT'L: 706-679-3262
LEADER: STEVE HOLCOMB
PASSCODE: KIRBY
WEBCAST: HTTP://WWW.KIRBYCORP.COM/ OR HTTP://AUDIOEVENT.MSHOW.COM/209520
------------------------- ----------------------------------
Page 4 of 7
A summary of the results for the fourth quarter and year follows:
CONDENSED CONSOLIDATED STATEMENTS OF EARNINGS
---------------------------------------------
FOURTH QUARTER YEAR
----------------------------- -----------------------------
2004 2003 2004 2003
------------- -------------- ------------ ---------------
(UNAUDITED, $ IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
Revenues:
Marine transportation . . . . . . . . . $ 151,156 $ 133,794 $ 588,828 $ 530,411
Diesel engine services. . . . . . . . . 22,583 18,234 86,491 83,063
------------- -------------- ------------ ---------------
173,739 152,028 675,319 613,474
------------- -------------- ------------ ---------------
Costs and expenses:
Costs of sales and operating expenses . 110,264 94,239 430,272 395,043
Selling, general and administrative . . 22,142 18,768 82,917 73,149
Taxes, other than on income . . . . . . 2,852 3,220 13,652 13,141
Depreciation and other amortization . . 13,717 14,833 55,120 53,328
Loss on disposition of assets . . . . . 58 37 299 99
------------- -------------- ------------ ---------------
149,033 131,097 582,260 534,760
------------- -------------- ------------ ---------------
Operating income. . . . . . . . . . . 24,706 20,931 93,059 78,714
Equity in earnings of marine affiliates 468 723 1,002 2,932
Other expense . . . . . . . . . . . . . (152) (285) (889) (1,021)
Interest expense. . . . . . . . . . . . (3,255) (3,546) (13,263) (14,628)
------------- -------------- ------------ ---------------
Earnings before taxes on income . . . 21,767 17,823 79,909 65,997
Provision for taxes on income . . . . . (8,271) (6,773) (30,365) (25,079)
------------- -------------- ------------ ---------------
Net earnings. . . . . . . . . . . . . $ 13,496 $ 11,050 $ 49,544 $ 40,918
============= ============== ============ ===============
Net earnings per share of common stock:
Basic . . . . . . . . . . . . . . . . . $ .55 $ .46 $ 2.02 $ 1.69
Diluted . . . . . . . . . . . . . . . . $ .53 $ .45 $ 1.97 $ 1.67
Common stock outstanding (in thousands):
Basic . . . . . . . . . . . . . . . . . 24,692 24,273 24,505 24,153
Diluted . . . . . . . . . . . . . . . . 25,425 24,734 25,157 24,506
CONDENSED CONSOLIDATED FINANCIAL INFORMATION
--------------------------------------------
FOURTH QUARTER YEAR
--------------------------- ------------------------------
2004 2003 2004 2003
------------ ------------- ------------- ---------------
(UNAUDITED, $ IN THOUSANDS EXCEPT PER SHARE AMOUNTS)
EBITDA: (1)
Net earnings . . . . . . . . . . . . . . . . . $ 13,496 $ 11,050 $ 49,544 $ 40,918
Interest expense . . . . . . . . . . . . . . . 3,255 3,546 13,263 14,628
Provision for taxes on income. . . . . . . . . 8,271 6,773 30,365 25,079
Depreciation and other amortization. . . . . . 13,717 14,833 55,120 53,328
------------ ------------- ------------- ---------------
$ 38,739 $ 36,202 $ 148,292 $ 133,953
============ ============= ============= ===============
EBITDA per share - diluted (1) . . . . . . . . . $ 1.52 $ 1.46 $ 5.89 $ 5.47
Capital expenditures . . . . . . . . . . . . . . $ 17,794 $ 20,169 $ 93,604 $ 72,356
Acquisitions of businesses and marine equipment. $ 389 $ - $ 11,474 $ 37,816
December 31,
------------------------------
2004 2003
------------- ---------------
(UNAUDITED, $ IN THOUSANDS)
Long-term debt, including current portion . . . . . . . . . . . . . . . . . $ 218,740 $ 255,265
Stockholders' equity. . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 435,235 $ 372,132
Debt to capitalization ratio. . . . . . . . . . . . . . . . . . . . . . . . 33.4% 40.7%
Page 5 of 7
MARINE TRANSPORTATION STATEMENTS OF EARNINGS
--------------------------------------------
FOURTH QUARTER YEAR
-------------------- --------------------
2004 2003 2004 2003
--------- --------- --------- ---------
(UNAUDITED, $ IN THOUSANDS)
Marine transportation revenues. . . . $151,156 $133,794 $588,828 $530,411
--------- --------- --------- ---------
Costs and expenses:
Costs of sales and operating expenses 92,964 80,887 365,590 332,600
Selling, general and administrative . 17,659 14,435 65,278 57,271
Taxes, other than on income . . . . . 2,874 3,374 13,349 12,824
Depreciation and other amortization . 12,928 14,138 52,076 50,442
--------- --------- --------- ---------
126,425 112,834 496,293 453,137
--------- --------- --------- ---------
Operating income. . . . . . . . . $ 24,731 $ 20,960 $ 92,535 $ 77,274
========= ========= ========= =========
Operating margins . . . . . . . . 16.4% 15.7% 15.7% 14.6%
========= ========= ========= =========
DIESEL ENGINE SERVICES STATEMENTS OF EARNINGS
---------------------------------------------
FOURTH QUARTER YEAR
------------------------------- ------------------------
2004 2003 2004 2003
---------------- ------------- -------------- --------
(UNAUDITED, $ IN THOUSANDS)
Diesel engine services revenues . . . $ 22,583 $ 18,234 $ 86,491 $83,063
---------------- ------------- -------------- --------
Costs and expenses:
Costs of sales and operating expenses 17,454 13,315 64,723 62,266
Selling, general and administrative . 2,790 2,923 11,882 11,530
Taxes, other than income. . . . . . . 67 91 335 332
Depreciation and amortization . . . . 280 257 1,163 1,045
---------------- ------------- -------------- --------
20,591 16,586 78,103 75,173
---------------- ------------- -------------- --------
Operating income. . . . . . . . . .$ 1,992 $ 1,648 $ 8,388 $ 7,890
================ ============= ============== ========
Operating margins . . . . . . . . . 8.8% 9.0% 9.7% 9.5%
================ ============= ============== ========
OTHER COSTS AND EXPENSES
------------------------
FOURTH QUARTER YEAR
------------------------- -------------------
2004 2003 2004 2003
------------ ----------- ----------- ------
(UNAUDITED , $ IN THOUSANDS)
General corporate expenses. . $ 1,959 $ 1,640 $ 7,565 $6,351
============ =========== =========== ======
Loss on disposition of assets $ 58 $ 37 $ 299 $ 99
============ =========== =========== ======
Page 6 of 7
MARINE TRANSPORTATION PERFORMANCE MEASUREMENTS
----------------------------------------------
FOURTH QUARTER YEAR
----------------- ----------------
2004 2003 2004 2003
------- -------- ------- -------
Ton Miles (in millions) (2). . . . . . . 3,938 4,115 16,232 15,582
Revenue/Ton Mile (cents/tm) (3) . . . . . 3.8 3.3 3.6 3.4
Towboats operated (average) (4). . . . . 235 224 235 225
Delay Days (5)(5). . . . . . . . . . . . 2,553 1,610 8,392 6,462
Average cost per gallon of fuel consumed. $ 1.40 $ .89 $ 1.13 $ .89
Tank barges:
Active. . . . . . . . . . . . . . . . . . . . . . . . . . . . 885 885
Inactive. . . . . . . . . . . . . . . . . . . . . . . . . . 56 60
Barrel capacities (in millions):
Active. . . . . . . . . . . . . . . . . . . . . . . . . . . . 16.4 16.2
Inactive. . . . . . . . . . . . . . . . . . . . . . . . . . . 1.1 1.1
- -----------------------
(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) Marine transportation revenues divided by ton miles. Example: Fourth
quarter 2004 revenues of $151,156,000 divided by 3,938,000,000 ton miles =
3.8 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 tank
barges) during transit. The measure includes transit delays caused by
weather, lock congestion and other navigational factors.
###
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