Barge line chief departs, earnings down

Barge line chief departs, earnings down American Commercial Lines Inc., one of the nation’s largest barge lines and barge builders, has named Michael P. Ryan president and chief executive officer.
   Ryan, senior vice president of sales and marketing, will succeed Mark Holden on March 1 and also fill Holden’s seat on the board of directors. Holden, who has led the company since January 2005, informed the board of his desire to pursue other opportunities.
   Separately, Christopher Black, senior vice president and chief financial officer, who previously announced that he would leave the company following the expiration of his employment agreement on Feb. 22, has agreed to remain with the company in his current capacity through March 1. Thereafter, Black will serve in a consulting capacity with the company for a two-month period to assist with the transition to a new chief financial officer.
   Meanwhile, the company reported fourth quarter net profit of $23.7 million 32.3 percent lower than the $35 million in the same period the prior year. Revenue for the quarter was $302.5 million up 13.8 percent from $265.9 million for the fourth quarter of 2006.
   Net income for 2007 was $44.4 million, a 51.9 percent decrease compared to net income for 2006 of $92.3 million. Revenue for the full year 2007 was $1.05 billion, up 11.4 percent from $942.6 million in 2006.
   For the full year, 2007 transportation revenue increased 2.7 percent to $808.6 million. Average fuel-neutral freight rates for the full year were up 13.4 percent on the liquid business and were down 1.2 percent on the dry freight business. Excluding grain, the average fuel-neutral rate for the dry business increased 4.9 percent over 2006.
   The company’s shipyard, Jeffboat, completed 404 barges during 2007, a 28 percent increase in production volume. Jeffboat sold 361 dry hopper barges, 41 liquid tank barges and two ocean-going vessels.
   The company said in 2007 it generated cash from operations of $115.8 million. It said it spent $109.3 million on capital expenditures to support its infrastructure and growth, and invested: $15.6 million for the acquisition of towboats and certain assets from the McKinney companies; $6.2 million for Summit Contracting; and $4.3 million for the acquisition of Elliott Bay Design Group.
   Debt increased $320.3 million during the year to $439.8 million at the end of 2007. The increased borrowing in 2007 was primarily the result of $300 million used to fund the repurchase of 12 million shares of its common stock. The company had about 50 million shares outstanding at Dec. 31.
   Looking forward, the company said it was suspending the practice of giving investors earnings guidance for 2008.
   “The volatility in the transportation industry as a whole and grain shipping in particular, along with a weak economy, escalating fuel costs and unpredictable weather patterns, obscure our visibility to accurately predict financial results at this time,” Ryan said. “We will revisit this decision later in the year, but cannot commit to reinstating guidance.”