Kirby Corp. Q3 earnings tank amid increased revenues

The Houston-based tank barge operator performed better than expected during the quarter as several tailwinds more than offset the negative impacts from hurricanes, according to president and chief executive officer David Grebinski.    Kirby Corp. recorded net earnings attributable to Kirby of $28.6 million in the third quarter of 2017, sinking 10.6 percent from the same quarter a year ago, according to the company’s most recent financial statements.
   However, the Houston-based tank barge operator’s consolidated revenues surged 24.5 percent year-over-year to $541.3 million for the quarter.
   Kirby President and CEO David Grebinski said the company’s results for the quarter were better than expected, noting that headwinds from hurricanes Harvey and Irma were more than offset by certain cost recoveries from marine customers for delays, a rebound in volume demand after the hurricanes, and strength in the company’s distribution and services segment, including Stewart & Stevenson LLC.
   In Kirby’s marine transportation segment, operating income stood at $36 million, down from $55.5 million for the third quarter of 2016, while the segment’s revenues totaled $318.8 million, down from $359 million for last year’s third quarter.
   In the inland market, barge utilization hovered around the mid-80 percent to mid-90 percent range for the quarter.
   Operating conditions in the inland market during the quarter were good prior to Hurricane Harvey’s arrival on the U.S. Gulf Coast at the end of August, but operating conditions were considerably challenged for the remainder of the quarter.
   Both term and spot contract pricing in the inland market were at lower levels compared to last year’s third quarter.
   In the coastal market, utilization remained in the low 60 percent to mid-60 percent range during the quarter, as the market further weakened and barges continued to move from term contracts into the spot market.
   Meanwhile, Kirby’s distribution and services segment recorded an operating income of $22 million on revenues of $222.5 million for the quarter, a sharp improvement from last year’s third quarter when the segment posted an operating income of $4.6 million on revenues of $75.7 million.
   The land-based distribution and services business continued seeing robust demand for remanufactured pressure pumping units and transmission overhauls.
   In the marine distribution and services business, Gulf Coast oilfield services remained slow. In addition, demand in the power generation market was slightly lower in the quarter, sequentially and compared to last year’s third quarter, which Kirby said was primarily due to the timing of major projects.