Mississippi flood impedes barge operations
Kirby Corp., the nation’s leading operator of tank barges, said Thursday that high water and flooding on the Mississippi River System may have a greater impact on its second quarter results than originally anticipated.
On April 27 the company said it expected second quarter profit of 67 to 77 cents per share, after a 2 cent to 7 cent impact from high water and lock issues. Today it said that impact might exceed 7 cents.
“Since April 27, conditions on the Mississippi River System have continued to deteriorate. The Ohio Valley received record rainfall and the heavy rainfall extended into May, thereby prolonging flooding conditions on the Ohio and Tennessee Rivers, extending the Smithland Lock closure near Paducah, Ky., and creating additional delays for both inbound and outbound barge traffic on the Ohio River. As of today, predictions are that the Smithland Lock on the Ohio River will remain closed for several more days.
“The high water on the Ohio River, as well as the upper Mississippi River, is flowing into the lower Mississippi River and creating flooding conditions as the high water crest makes its way south,” the company said.
The Coast Guard has issued notice that when certain conditions are met, it will close the Gulf Intracoastal Waterway in the Morgan City area to marine traffic, Kirby said. This closure may last up to several weeks. The high water on the Mississippi River System and the potential closure of the Gulf Intracoastal Waterway will impact tank barge traffic.
“The current flooding conditions on the Mississippi River System and the anticipated closure of the Gulf Intracoastal Waterway will have a negative impact on our inland marine transportation operations and second quarter earnings,' said Joe Pyne, Kirby’s chairman and chief executive officer. 'However, the majority of movements west of Morgan City on the Gulf Intracoastal Waterway, including the Lake Charles, Beaumont, Port Arthur, Houston and Corpus Christi areas, are operating as usual. The upper Mississippi River and Illinois River have returned to normal navigation.
“Based on current conditions, we anticipate the Ohio River to return to normal navigation in mid- to late-May, and the lower Mississippi River to return to normal navigation by the end of May or early June. We anticipate the last area to resume normal navigation will be the Gulf Intracoastal Waterway’s Morgan City area as the Atchafalaya River Basin is just now being impacted and may be the slowest to recover. Unfortunately, until the flooding subsides and tank barge traffic resumes, it is not possible for us to accurately assess the financial impact of these historic events.
“We will revise or confirm our second quarter earnings guidance when our assessment of the financial impact of the high water events is completed. Approximately 50 percent of our marine transportation revenue under term contracts is from time charters, which are insulated from revenue fluctuations caused by weather and navigational delays.” ' Chris Dupin