2 unchanged sentences
CONDENSED BALANCE SHEETS
−Removed: September 30,
($ in thousands)
15 unchanged sentences
Bank notes payable
+Added: Income taxes payable
Accounts payable
18 unchanged sentences
Treasury stock –
−Removed: at cost, 5.6 million shares at September 30, 2022 and 5.4 million at December 31, 2021
+Added: at cost, 5.5 million shares at March 31, 2023 and 5.6 million at December 31, 2022
Total Kirby stockholders’
4 unchanged sentences
CONDENSED STATEMENTS OF EARNINGS
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
($ in thousands, except per share amounts)
9 unchanged sentences
Total costs and expenses
−Removed: Operating income (loss)
+Added: Operating income
Interest expense
−Removed: Earnings (loss) before taxes on income
−Removed: (Provision) benefit for taxes on income
−Removed: Net earnings (loss)
+Added: Earnings before taxes on income
+Added: Provision for taxes on income
Net (earnings) loss attributable to noncontrolling interests
−Removed: Net earnings (loss) attributable to Kirby
−Removed: Net earnings (loss) per share attributable to Kirby common stockholders:
+Added: Net earnings attributable to Kirby
+Added: Net earnings per share attributable to Kirby common stockholders:
See accompanying notes to condensed financial statements.
1 unchanged sentence
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
($ in thousands)
−Removed: Net earnings (loss)
Other comprehensive income, net of taxes:
2 unchanged sentences
Total other comprehensive income, net of taxes
−Removed: Total comprehensive income (loss), net of taxes
+Added: Total comprehensive income, net of taxes
Net (earnings) loss attributable to noncontrolling interests
−Removed: Comprehensive income (loss) attributable to Kirby
+Added: Comprehensive income attributable to Kirby
See accompanying notes to condensed financial statements.
1 unchanged sentence
CONDENSED STATEMENTS OF CASH FLOWS
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
($ in thousands)
Cash flows from operating activities:
−Removed: Net earnings (loss)
−Removed: Adjustments to reconcile net earnings (loss) to net cash provided by operations:
+Added: Adjustments to reconcile net earnings to net cash provided by operations:
Depreciation and amortization
−Removed: Provision (benefit) for deferred income taxes
+Added: Provision for deferred income taxes
Amortization of share-based compensation
Amortization of major maintenance costs
−Removed: Increase (decrease) in cash flows resulting from changes in operating assets and liabilities, net
+Added: Decrease in cash flows resulting from changes in operating assets and liabilities, net
Net cash provided by operating activities
1 unchanged sentence
Capital expenditures
−Removed: Acquisitions of businesses and marine equipment
+Added: Acquisitions of businesses
Proceeds from disposition of assets
1 unchanged sentence
Cash flows from financing activities:
−Removed: Borrowings (payments) on bank credit facilities, net
+Added: Borrowings on bank credit facilities, net
Borrowings on long-term debt
6 unchanged sentences
Net cash used in financing activities
−Removed: Increase (decrease) in cash and cash equivalents
+Added: Decrease in cash and cash equivalents
Cash and cash equivalents, beginning of year
15 unchanged sentences
(in thousands)
−Removed: Balance at June 30, 2022
−Removed: Stock option exercises
−Removed: Issuance of stock for equity awards, net of forfeitures
−Removed: Tax withholdings on equity award vesting
−Removed: Amortization of unearned share-based compensation
−Removed: Treasury stock purchases
−Removed: Total comprehensive income, net of taxes
−Removed: Return of investment to noncontrolling interests
−Removed: Balance at September 30, 2022
−Removed: Comprehensive
−Removed: Treasury Stock
−Removed: Noncontrolling
−Removed: (in thousands)
−Removed: Balance at June 30, 2021
−Removed: Stock option exercises
−Removed: Issuance of stock for equity awards, net of forfeitures
−Removed: Tax withholdings on equity award vesting
−Removed: Amortization of unearned share-based compensation
−Removed: Total comprehensive loss, net of taxes
−Removed: Return of investment to noncontrolling interests
−Removed: Balance at September 30, 2021
−Removed: See accompanying notes to condensed financial statements.
−Removed: KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
−Removed: CONDENSED STATEMENTS OF STOCKHOLDERS’
−Removed: Comprehensive
−Removed: Treasury Stock
−Removed: Noncontrolling
−Removed: (in thousands)
Balance at December 31, 2022
5 unchanged sentences
Total comprehensive income, net of taxes
−Removed: Return of investment to noncontrolling interests
−Removed: Balance at September 30, 2022
+Added: Balance at March 31, 2023
Comprehensive
7 unchanged sentences
Amortization of share-based compensation
−Removed: Total comprehensive loss, net of taxes
+Added: Total comprehensive income, net of taxes
Return of investment to noncontrolling interests
−Removed: Balance at September 30, 2021
+Added: Balance at March 31, 2022
See accompanying notes to condensed financial statements.
2 unchanged sentences
(1) Basis for Preparation of the Condensed Financial Statements
−Removed: The condensed financial statements included herein have been prepared by Kirby Corporation and its consolidated subsidiaries (the “Company”), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission.
+Added: The condensed financial statements included herein have been prepared by Kirby Corporation and its consolidated subsidiaries (“Kirby”
+Added: or the “Company”), without audit, pursuant to the rules and regulations of the Securities and Exchange Commission.
Although the Company believes that the disclosures are adequate to make the information presented not misleading, certain information and footnote disclosures, including significant accounting policies normally included in annual financial statements, have been condensed or omitted pursuant to such rules and regulations.
1 unchanged sentence
Certain reclassifications have been made to reflect the current presentation of financial information.
−Removed: (2) Acquisitions
+Added: (2) Acquisition
On March 31, 2022, the Company paid $ 3.9 million in cash to purchase assets of a gearbox repair company in the distribution and services segment.
Assets acquired consisted primarily of property and equipment.
−Removed: During the nine months ended September 30, 2021, the Company purchased four inland tank barges from a leasing company for $ 7.5 million in cash.
−Removed: The Company had been leasing the barges prior to the purchase.
The following table sets forth the Company’s revenues by major source (in thousands):
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
Marine transportation segment:
4 unchanged sentences
Contract liabilities represent advance consideration received from customers, and are recognized as revenue over time as the related performance obligation is satisfied.
−Removed: Revenues recognized during the nine months ended September 30, 2022 and 2021 that were included in the opening contract liability balances were $ 54.6 million and $ 40.3 million , respectively.
+Added: Revenues recognized during the three months ended March 31, 2023 and 2022 that were included in the opening contract liability balances were $ 38.8 million and $ 28.6 million , respectively.
The Company presents all contract liabilities within the deferred revenues financial statement caption on the balance sheets.
−Removed: The Company did no t have any contract assets at September 30, 2022 or December 31, 2021 .
+Added: The Company did no t have any contract assets at March 31, 2023 or December 31, 2022 .
The Company applies the practical expedient that allows non-disclosure of information about remaining performance obligations that have original expected durations of one year or less.
9 unchanged sentences
The Company evaluates the performance of its segments based on the contributions to operating income of the respective segments, before income taxes, interest, gains or losses on disposition of assets, other nonoperating income, noncontrolling interests, accounting changes, and nonrecurring items.
−Removed: Intersegment revenues, based on market-based pricing, of KDS from KMT of $ 8.0 million and $ 21.9 million for the three months and nine months ended September 30, 2022, respectively, and $ 5.4 million and $ 17.6 million for the three months and nine months ended September 30, 2021, respectively, as well as the related intersegment profit of $ 0.8 million and $ 2.2 million for the three months and nine months ended September 30, 2022 and $ 0.5 million and $ 1.8 million for the three months and nine months ended September 30, 2021, respectively, have been eliminated from the tables below.
+Added: Intersegment revenues, based on market-based pricing, of KDS from KMT of $ 9.4 million and $ 7.6 million for the three months ended March 31, 2023 and 2022, respectively, as well as the related intersegment profit of $ 0.9 million and $ 0.8 million for the three months ended March 31, 2023 and 2022, respectively, have been eliminated from the tables below.
The following tables set forth the Company’s revenues and profit or loss by reportable segment and total assets (in thousands):
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
Marine transportation
3 unchanged sentences
Distribution and services
−Removed: September 30,
Total assets:
3 unchanged sentences
segment loss (in thousands):
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
General corporate expenses
3 unchanged sentences
total assets (in thousands):
−Removed: September 30,
General corporate assets
2 unchanged sentences
The following table presents the carrying value and fair value (determined using inputs characteristic of a Level 2 fair value measurement) of debt outstanding (in thousands):
−Removed: September 30, 2022
+Added: March 31, 2023
December 31, 2022
3 unchanged sentences
Term Loan due July 29, 2027 (a)
−Removed: Term Loan due March 27, 2024 (b)
3.29 % senior notes due February 27, 2023
4.2 % senior notes due March 1, 2028
+Added: 3.46 % senior notes due January 19, 2033
+Added: 3.51 % senior notes due January 19, 2033
Credit line due June 30, 2024
Bank notes payable
−Removed: Unamortized debt discounts and issuance costs (c)
−Removed: (a) Variable interest rate o f 4.5 % at September 30, 2022.
−Removed: (b) Variable interest rate of 1.5 % at December 31, 2021.
−Removed: (c) Excludes $ 1.4 million attributable to the 2024 Revolving Credit Facility included in other assets at December 31, 2021 .
+Added: Unamortized debt discounts and issuance costs (b)
+Added: (a) Variable interest rate o f 6.3 % at March 31, 2023.
+Added: (b) Excludes $ 1.8 million attributable to the 2027 Revolving Credit Facility included in other assets at December 31, 2022 .
The following table presents borrowings and payments under the bank credit facilities (in thousands):
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
Borrowings on bank credit facilities
Payments on bank credit facilities
−Removed: At the beginning of the third quarter of 2022, the Company had an amended and restated credit agreement (the “2024 Credit Agreement”) with a group of commercial banks, with JPMorgan Chase Bank, N.A.
+Added: At the beginning of 2022, the Company had an amended and restated credit agreement (the “2024 Credit Agreement”) with a group of commercial banks, with JPMorgan Chase Bank, N.A.
as the administrative agent bank, that allowed for an $ 850 million unsecured revolving credit facility (the “2024 Revolving Credit Facility”) and an unsecured term loan (the “2024 Term Loan”) with a maturity date of March 27, 2024 .
4 unchanged sentences
In conjunction with entering into the 2027 Credit Agreement, on July 29, 2022, the Company borrowed $ 35 million under the 2027 Revolving Credit Facility and $ 250 million under the 2027 Term Loan to repay borrowings under the 2024 Term Loan.
−Removed: In October 2022, the Company repaid $ 20.0 million under the 2027 Term Loan prior to scheduled maturities.
−Removed: As a result, no repayments are required until September 30, 2023.
−Removed: The 2027 Term Loan quarterly installments are excluded from short term liabilities because the Company has the ability and intent to refinance these quarterly installments under the 2027 Revolving Credit Facility.
−Removed: Outstanding letters of credit under the 2027 Revolving Credit Facility were $ 5.1 million and available borrowing capacity was $ 474.9 million as of September 30, 2022.
−Removed: Outstanding letters of credit under the $ 10 million credit line were $ 1.4 million and available borrowing capacity was $ 8.6 million as of September 30, 2022.
−Removed: The 2027 Term Loan is repayable in quarterly installments, scheduled to commence September 30, 2023, in increasing percentages of the original principal amount of the loan, with the remaining unpaid balance of approximately $ 43.8 million payable upon maturity, assuming no prepayment.
+Added: In the fourth quarter of 2022, the Company repaid $ 80.0 million under the 2027 Term Loan prior to scheduled maturities.
+Added: As a result, no repayments are required until June 30, 2025.
+Added: Outstanding letters of credit under the 2027 Revolving Credit Facility were $ 5.1 million and available borrowing capacity was $ 382.9 million as of March 31, 2023.
+Added: The 2027 Term Loan is repayable in quarterly installments, with no repayments until June 30, 2025, in increasing percentages of the original principal amount of the loan, with the remaining unpaid balance of approximately $ 43.8 million payable upon maturity, assuming no prepayment.
The 2027 Term Loan is prepayable, in whole or in part, without penalty.
The 2027 Credit Agreement provides for a variable interest rate based on the Secured Overnight Financing Rate (“SOFR”) or a base rate calculated with reference to the prime rate quoted by The Wall Street Journal, the Federal Reserve Bank of New York Rate plus 0.5 %, or the adjusted SOFR rate for a one month interest period plus 1.0 %, among other factors (the “Alternate Base Rate”).
−Removed: The interest rate varies with the Company's credit rating and is currently 137.5 basis points over SOFR or 37.5 basis points over the Alternate Base Rate.
+Added: The interest rate varies with the Company’s credit rating and is currently 137.5 basis points over SOFR or 37.5 basis points over the Alternate Base Rate.
The 2027 Credit Agreement contains certain financial covenants including an interest coverage ratio and debt-to-capitalization ratio.
4 unchanged sentences
On February 3, 2022, the Company entered into a note purchase agreement for the issuance of $ 300 million of unsecured senior notes with a group of institutional investors, consisting of $ 60 million of 3.46 % series A notes (“Series A Notes”) and $ 240 million of 3.51 % series B notes (“Series B Notes ”), each due January 19, 2033 (collectively, the “2033 Notes”).
−Removed: The Series A Notes were issued on October 20, 2022, and the Series B Notes are scheduled to be issued on January 19, 2023.
+Added: The Series A Notes were issued on October 20, 2022, and the Series B Notes were issued on January 19, 2023.
No principal payments will be required until maturity.
−Removed: Beginning in 2023, interest payments of $ 5.3 million will be due semi-annually on January 19 and July 19 of each year, with the exception of the first payment on January 19, 2023, which will be $ 0.5 million.
−Removed: The 2033 Notes will be unsecured and rank equally in right of payment with the Company's other unsecured senior indebtedness.
+Added: Beginning in 2023, interest payments of $ 5.3 million will be due semi-annually on January 19 and July 19 of each year, with the exception of the first payment on January 19, 2023, which was $ 0.5 million.
+Added: The 2033 Notes are unsecured and rank equally in right of payment with the Company's other unsecured senior indebtedness.
The 2033 Notes contain certain covenants on the part of the Company, including an interest coverage covenant, a debt-to-capitalization covenant, and covenants relating to liens, asset sales and mergers, among others.
The 2033 Notes also specify certain events of default, upon the occurrence of which the maturity of the notes may be accelerated, including failure to pay principal and interest, violation of covenants or default on other indebtedness, among others.
−Removed: The 3.29 % unsecured senior notes due February 27, 2023 (the “2023 Notes”) are excluded from short term liabilities because the Company intends to use a combination of the proceeds from the issuance of the 2033 Notes and availability under the 2027 Re volving Credit Facility to repay the 2023 Notes upon maturity.
+Added: The 3.29 % unsecured senior notes due February 27, 2023 (the “2023 Notes”) were repaid using a combination of the proceeds from the issuance of the 2033 Notes and availability under the 2027 Revolving Credit Facility.
+Added: The Company has a $ 10 million line of credit (“Credit Line”) with Bank of America, N.A.
+Added: (“Bank of America”) for short-term liquidity needs and letters of credit, with a maturity date of June 30, 2024 .
+Added: Outstanding letters of credit under the $ 10 million credit line were $ 0.6 million and available borrowing capacity was $ 9.4 million as of March 31, 2023 .
The Company currently leases various facilities and equipment under cancelable and noncancelable operating leases.
5 unchanged sentences
Future minimum lease payments under operating leases that have initial noncancelable lease terms in excess of one year were as follows (in thousands):
−Removed: September 30,
Total lease payments
2 unchanged sentences
The following table summarizes lease costs (in thousands):
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
Operating lease cost
3 unchanged sentences
The following table summarizes other supplemental information about the Company’s operating leases:
−Removed: September 30,
Weighted average discount rate
Weighted average remaining lease term
−Removed: (7) Impairments
−Removed: During the third quarter of 2021, the Company decided to exit the Hawaii market, selling marine transportation equipment including four coastal tank barges, seven coastal tugboats, and certain other assets for aggregate cash proceeds of $ 17.2 million.
−Removed: In addition, as of September 30, 2021, the Company retired and classified as held for sale, an additional 12 coastal tank barges and four coastal tugboats which were underutilized.
−Removed: The sales and retirements of coastal marine transportation equipment resulted in an aggregate non‑cash impairment charge of $ 97.5 million to reduce the carrying value of these assets to their estimated sales prices, net of costs to sell.
−Removed: As a result of the sale of the Hawaii marine transportation equipment, and the decision to retire certain additional underutilized coastal tank barges and tugboats, the Company concluded that a triggering event had occurred and performed interim quantitative impairment tests as of September 30, 2021 for certain of the marine transportation segment's long-lived assets and goodwill within the coastal marine market.
−Removed: The Company determined the estimated fair value of such long-lived assets using a combination of a cost approach, a discounted cash flow analysis, and a market approach.
−Removed: The Company determined the estimated fair value of the reporting unit using a combination of a discounted cash flow analysis and a market approach for comparable companies.
−Removed: These analyses included management’s judgment regarding short-term and long-term internal forecasts, updated for recent events, appropriate discount rates, and capital expenditures using inputs characteristic of a Level 3 fair value measurement.
−Removed: In performing the impairment test of certain long-lived assets within the marine transportation segment, the Company determined that the carrying value of certain long-lived assets, including certain coastal marine transportation equipment and operating lease right-of-use assets, were no longer recoverable, resulting in a non-cash impairment charge of $ 24.2 million during the three months ended September 30, 2021 to reduce such long-lived assets to fair value.
−Removed: Based upon the results of the goodwill impairment test, the Company concluded that the carrying value of one reporting unit in the marine transportation segment exceeded its estimated fair value.
−Removed: The carrying value of the reporting unit, including goodwill, and after recording impairments of long-lived assets identified above, exceeded its estimated fair value, resulting in a non-cash goodwill impairment charge of $ 219.1 million for the three months ended September 30, 2021.
(7) Stock Award Plans
The compensation cost that has been charged against earnings for the Company’s stock award plans and the income tax benefit recognized in the statement of earnings for stock awards were as follows (in thousands):
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
Compensation cost
Income tax benefit
−Removed: During the nine months ended September 30, 2022, the Company grant ed 208,706 restricted stock units (“RSUs”) to selected officers and other key employees under the employee stock award plan which vest ratably over five years and 27,696 shares of restricted stock to nonemployee directors of the Company under the director stock plan, the majority of which vest six months after the date of grant.
+Added: During the three months ended March 31, 2023, the Company grant ed 181,670 restricted stock units (“RSUs”) to selected officers and other key employees under the employee stock award plan which vest ratably over five years .
+Added: During May 2023, the Company granted 30,150 shares of restricted stock to nonemployees directors of the Company under the director stock plan, the majority of which vest six months after the date of grant.
(8) Taxes on Income
−Removed: At September 30, 2022 and December 31, 2021, the Company had a federal income tax receivable of $ 70.5 million and $ 71.0 million , respectively, included in Accounts Receivable –
+Added: At March 31, 2023 and December 31, 2022, the Company had a federal income tax receivable of $ 70.4 million included in Accounts Receivable –
Other on the balance sheets.
−Removed: During the three months ended March 31, 2021, the Company received a tax refund of $ 119.5 million, including accrued interest, for its 2019 federal tax return related to net operating losses being carried back to offset taxable income generated between 2014 and 2017.
−Removed: Earnings (loss) before taxes on income and details of the provision (benefit) for taxes on income were as follows (in thousands):
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
−Removed: Earnings (loss) before taxes on income:
+Added: During the first quarter of 2023, the Internal Revenue Service (“IRS”) communicated to the Company that it has completed its examination of the Company’s federal income tax returns for the years 2013 through 2020.
+Added: In April 2023, the Company received its tax refund of $ 70.4 million plus accrued interest .
+Added: Earnings before taxes on income and details of the provision for taxes on income were as follows (in thousands):
+Added: Three Months Ended March 31,
+Added: Earnings before taxes on income:
United States
−Removed: Provision (benefit) for taxes on income:
+Added: Provision for taxes on income:
State and local:
1 unchanged sentence
(9) Earnings Per Share
−Removed: The following table presents the components of basic and diluted earnings (loss) per share (in thousands, except per share amounts):
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
−Removed: Net earnings (loss) attributable to Kirby
+Added: The following table presents the components of basic and diluted earnings per share (in thousands, except per share amounts):
+Added: Three Months Ended March 31,
+Added: Net earnings attributable to Kirby
Undistributed earnings allocated to restricted shares
−Removed: Earnings (loss) available to Kirby common stockholders –
+Added: Earnings available to Kirby common stockholders –
Undistributed earnings allocated to restricted shares
Undistributed earnings reallocated to restricted shares
−Removed: Earnings (loss) available to Kirby common stockholders –
+Added: Earnings available to Kirby common stockholders –
Shares outstanding:
4 unchanged sentences
Weighted average common stock outstanding –
−Removed: Net earnings (loss) per share attributable to Kirby common stockholders:
−Removed: Certain outstanding options to purchase approximately 0.4 million and 0.6 million shares of common stock were excluded in the computation of diluted earnings per share as of September 30, 2022 and 2021, respectively, as such stock options would have been antidilutive.
−Removed: Certain outstanding RSUs to convert to 11,000 and 565,000 shares of common stock were also excluded in the computation of diluted earnings per share as of September 30, 2022 and 2021 , respectively, as such RSUs would have been antidilutive.
+Added: Net earnings per share attributable to Kirby common stockholders:
+Added: Certain outstanding options to purchase approximately 0.3 million and 0.4 million shares of common stock were excluded in the computation of diluted earnings per share as of March 31, 2023 and 2022 , respectively, as such stock options would have been antidilutive.
+Added: There were no antidilutive RSUs as of March 31, 2023 and 2022.
(10) Inventories
1 unchanged sentence
net (in thousands):
−Removed: September 30,
Finished goods
14 unchanged sentences
On March 27, 2018, the Company amended the Higman pension plan to close it to all new entrants and cease all benefit accruals for periods after May 15, 2018 for all participants.
−Removed: The Company made a contribution of $ 0.7 million to the Higman pension plan during the nine months ended September 30, 2022 and a contribution of $ 0.2 million during October 2022.
−Removed: The Company does not expect to make any additional contributions for the remainder of 2022.
+Added: The Company made contributions of $ 7.5 million to the Higman pension plan during the three months ended March 31, 2023.
The Company sponsors an unfunded defined benefit health care plan that provides limited postretirement medical benefits to employees who meet minimum age and service requirements, and to eligible dependents.
7 unchanged sentences
Pension Plans
−Removed: Three Months Ended September 30,
−Removed: Three Months Ended September 30,
−Removed: Components of net periodic benefit cost:
−Removed: Interest cost
−Removed: Expected return on plan assets
−Removed: Amortization of actuarial loss
−Removed: Net periodic benefit cost
−Removed: Pension Benefits
−Removed: Pension Plans
−Removed: Nine Months Ended September 30,
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
+Added: Three Months Ended March 31,
Components of net periodic benefit cost:
6 unchanged sentences
Postretirement Welfare Plan
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
Components of net periodic benefit cost:
4 unchanged sentences
The Company’s changes in other comprehensive income were as follows (in thousands):
−Removed: Three Months Ended September 30,
−Removed: Income Tax (Provision) Benefit
−Removed: Income Tax Provision
−Removed: Pension and postretirement benefits (a):
−Removed: Amortization of net actuarial (gain) loss
−Removed: Actuarial gains
−Removed: Foreign currency translation
−Removed: Nine Months Ended September 30,
−Removed: Income Tax (Provision) Benefit
+Added: Three Months Ended March 31,
+Added: Income Tax Benefit
Income Tax Provision
1 unchanged sentence
Amortization of net actuarial (gain) loss
−Removed: Actuarial gains
Foreign currency translation
17 unchanged sentences
The Company has issued guaranties or obtained standby letters of credit and performance bonds supporting performance by the Company and its subsidiaries of contractual or contingent legal obligations of the Company and its subsidiaries incurred in the ordinary course of business.
−Removed: The aggregate notional value of these instruments is $ 20.1 million at September 30, 2022, including $ 12.1 million in letters of credit and $ 8.0 million in performance bonds.
+Added: The aggregate notional value of these instruments is $ 18.1 million at March 31, 2023, including $ 11.3 million in letters of credit and $ 6.8 million in performance bonds.
All of these instruments have an expiration date within two years .
15 unchanged sentences
Forward-looking statements are based on currently available information and the Company assumes no obligation to update any such statements.
−Removed: For purposes of Management’s Discussion, all net earnings (loss) per share attributable to Kirby common stockholders are “diluted earnings (loss) per share.”
+Added: For purposes of Management’s Discussion, all net earnings per share attributable to Kirby common stockholders are “diluted earnings per share.”
The Company is the nation’s largest domestic tank barge operator, transporting bulk liquid products throughout the Mississippi River System, on the Gulf Intracoastal Waterway, and coastwise along all three United States coasts.
3 unchanged sentences
The following table summarizes key operating results of the Company (in thousands, except per share amounts):
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
Total revenues
−Removed: Net earnings (loss) attributable to Kirby
−Removed: Net earnings (loss) per share attributable to Kirby common stockholders –
+Added: Net earnings attributable to Kirby
+Added: Net earnings per share attributable to Kirby common stockholders –
Net cash provided by operating activities
Capital expenditures
−Removed: The 2022 second quarter included $1.5 million before taxes, $1.3 million after taxes, or $0.02 per share of severance expense.
−Removed: The 2021 third quarter included $340.7 million before taxes, $275.1 million after taxes, or $4.58 per share, non-cash charges related to impairment of long-lived assets related to coastal marine transportation equipment and impairment of goodwill in the marine transportation segment.
−Removed: See Note 7, Impairments in the financial statements for additional information.
−Removed: Cash provided by operating activities for the 2022 first nine months decreased in comparison to the 2021 first nine months primarily due to the receipt of a tax refund of $119.5 million, including accrued interest, for the Company’s 2019 federal tax return during the 2021 first quarter.
−Removed: For the 2022 first nine months, capital expenditures of $120.3 million included $102.8 million in KMT and $17.5 million in KDS and corporate, each more fully described under Cash Flow and Capital Expenditures below.
+Added: The 2023 first quarter included $3.0 million before taxes, $2.4 million after taxes, or $0.04 per share of costs related to strategic review and shareholder engagement and $2.7 million before taxes, $2.2 million after taxes, or $0.04 per share of other income associated with the interest on the refund from the Internal Revenue Service (“IRS”).
+Added: Cash provided by operating activities for the 2023 first quarter decreased in comparison to the 2022 first quarter primarily due to an increase in working capital, partially offset by improved net earnings.
+Added: For the 2023 first quarter, capital expenditures of $73.2 million included $46.6 million in KMT and $26.6 million in KDS and corporate, each more fully described under Cash Flow and Capital Expenditures below.
The Company projects that capital expenditures for 2023 will be in the $300 million to $380 million range.
−Removed: The 2022 construction program will consist of approximately $5 million for the construction of new inland towboats, $145 million to $155 million primarily for maintenance capital and improvements to existing marine equipment and facilities, and $20 million to $30 million for new machinery and equipment, facilities improvements, and information technology projects in KDS and corporate.
−Removed: The Company’s debt-to-capitalization ratio decreased to 27.3% at September 30, 2022 from 28.7% at December 31, 2021, primarily due to repayments under the 2024 Term Loan in the first nine months of 2022, and an increase in total equity, primarily due to the net earnings attributable to Kirby of $85.0 million, partially offset by treasury stock purchases of $22.9 million.
−Removed: The Company’s debt outstanding as of September 30, 2022 and December 31, 2021 is detailed in Long-Term Financing below.
+Added: The 2023 construction program will consist of up to approximately $40 million for the construction of inland specialized equipment, approximately $240 million primarily for maintenance capital and improvements to existing marine equipment, including ballast water treatment systems on some coastal vessels, and facility improvements.
+Added: The balance of up to approximately $100 million relates to new electric fracturing equipment and facilities improvements in KDS, and information technology projects in corporate.
+Added: The Company’s debt-to-capitalization ratio decreased to 25.9% at March 31, 2023 from 26.2% at December 31, 2022, primarily due an increase in total equity, largely due to the net earnings attributable to Kirby of $40.7 million, partially offset by treasury stock purchases of $3.2 million.
+Added: The Company’s debt outstanding as of March 31, 2023 and December 31, 2022 is detailed in Long-Term Financing below.
Marine Transportation
−Removed: For both the 2022 third quarter and first nine months, KMT generated 58% of the Company’s revenues.
+Added: For the 2023 first quarter, KMT generated 55% of the Company’s revenues compared to 58% for the 2022 first quarter.
The segment’s customers include many of the major petrochemical and refining companies that operate in the United States.
3 unchanged sentences
The following table summarizes the Company’s marine transportation fleet:
−Removed: September 30,
Inland tank barges:
6 unchanged sentences
Offshore tugboats and docking tugboat (owned and chartered)
−Removed: The Company also owns shifting operations and fleeting facilities for dry cargo barges and tank barges on the Houston Ship Channel and in Freeport and Port Arthur, Texas, and Lake Charles, Louisiana, and a shipyard for building towboats and performing routine maintenance near the Houston Ship Channel, as well as a two-thirds interest in Osprey Line, L.L.C., which transports project cargoes and cargo containers by barge.
−Removed: During the 2022 first nine months, the Company brought back into service 14 inland tank barges and returned four leased tank barges.
−Removed: The net result was an increase of ten inland tank barges and approximately 0.2 million barrels of capacity.
−Removed: KMT revenues for the 2022 third quarter and first nine months increased 28% and 23%, respectively, and operating income increased 147% and 140%, respectively, compared to the 2021 third quarter and first nine months.
−Removed: The increases for the 2022 third quarter and first nine months were primarily due to increased tank barge utilization, higher term and spot pricing, and higher fuel rebills in the inland and coastal markets.
−Removed: Also, the 2022 first quarter was impacted by the COVID-19 Omicron variant as increased cases of the virus among the Company’s mariners led to crewing challenges, lost revenue and increased operating costs.
−Removed: The 2021 first nine months was also heavily impacted by Winter Storm Uri which shut down many Gulf Coast refineries and chemical plants for an extended period of time starting in mid-February.
−Removed: These emergency shutdowns resulted in significantly reduced liquids production and lower volumes for the Company’s inland marine transportation market during the 2021 first quarter.
−Removed: The 2021 first nine months revenues and operating income were also impacted by Hurricane Ida in the 2021 third quarter which shuttered almost the entire Southeast Louisiana refinery and chemical complex and key waterways for an extended period of time.
−Removed: The 2022 and 2021 first quarters were impacted by poor operating conditions including seasonal wind and fog along the Gulf Coast, flooding on the Mississippi River, and various lock closures along the Gulf Intracoastal Waterway, in addition to ice on the Illinois River.
−Removed: For the 2022 third quarter and first nine months, the inland tank barge fleet contributed 80% and 79%, respectively, and the coastal fleet contributed 20% and 21%, respectively, of KMT
−Removed: For the 2021 third quarter and first nine months, the inland tank barge fleet contributed 76% and 75%, respectively, and the coastal fleet contributed 24% and 25%, respectively, of KMT revenues.
−Removed: Inland tank barge utilization levels averaged in the mid-80% range during the 2022 first quarter, the low 90% range during the 2022 second and third quarters compared to the mid-70% range during the 2021 first quarter, the low to mid-80% range during the 2021 second quarter, and the low 80% range during the 2021 third quarter.
−Removed: The 2022 first nine months reflected increasing activity levels as a result of higher refinery and petrochemical plant utilization while the 2021 first nine months was impacted by reduced demand resulting from the effects of the COVID-19 pandemic causing an economic slowdown as well as reduced volumes due to Winter Storm Uri during the 2021 first quarter and Hurricane Ida during the 2021 third quarter, partially offset by the Colonial Pipeline outage which increased barge transportation activity in the 2021 second quarter.
−Removed: Coastal tank barge utilization levels averaged in the low 90% range during the 2022 first and second quarters and the low to mid-90% range during the 2022 third quarter compared to the mid-70% range during the 2021 first and third quarters and the low to mid-70% range during the 2021 second quarter.
−Removed: The increase in coastal tank barge utilization during 2022 was primarily due to the retirement of underutilized barges in the 2021 third quarter and some modest improvements in customer demand.
−Removed: During both the 2022 third quarter and first nine months, approximately 60% of KMT inland revenues were under term contracts and 40% were spot contract revenues.
−Removed: During both the 2021 third quarter and first nine months, approximately 65% of KMT inland revenues were under term contracts and 35% were spot contract revenues.
−Removed: Inland time charters during the 2022 third quarter and first nine months represented 56% and 57%, respectively, of the inland revenues under term contracts compared with 56% and 58% in the 2021 third quarter and first nine months, respectively.
−Removed: During the 2022 third quarter and first nine months, approximately 65% and 75%, respectively, of KMT coastal inland revenues were under term contracts and 35% and 25%, respectively, were spot contracts.
−Removed: During both the 2021 third quarter and first nine months, approximately 80% of the coastal revenues were under term contracts and 20% were spot contract revenues.
−Removed: Coastal time charters represented approximately 90% of coastal revenues under term contracts during both the 2022 third quarter and first nine months compared with approximately 85% during both the 2021 third quarter and first nine months.
+Added: The Company also owns shifting operations and fleeting facilities for dry cargo barges and tank barges on the Houston Ship Channel and in Freeport and Port Arthur, Texas, and Lake Charles, Louisiana and a shipyard for building towboats and performing routine maintenance near the Houston Ship Channel.
+Added: Further, the Company owns a two-thirds interest in Osprey Line, L.L.C., which transports project cargoes and cargo containers by barge.
+Added: During the 2023 first quarter, the Company brought back into service a net five inland tank barges and chartered one tank barge, increasing its capacity by approximately 0.1 million barrels of capacity.
+Added: KMT revenues for the 2023 first quarter increased 16% and operating income increased 154% compared to the 2022 first quarter.
+Added: The increases for the 2023 first quarter were primarily due to higher term and spot pricing and increased tank barge utilization in the inland and coastal markets.
+Added: Also, the 2022 first quarter was impacted by the COVID-19 Omicron variant as increased cases among the Company’s mariners led to crewing challenges, lost revenue and increased operating costs.
+Added: The 2023 and 2022 first quarters were impacted by poor operating conditions including seasonal wind and fog along the Gulf Coast, flooding on the Mississippi River, and various lock closures along the Gulf Intracoastal Waterway resulting in higher delay days.
+Added: For the 2023 first quarter, the inland tank barge fleet contributed 82% and the coastal fleet contributed 18% of KMT revenues.
+Added: For the 2022 first quarter, the inland tank barge fleet contributed 78% and the coastal fleet contributed 22% of KMT revenues.
+Added: Inland tank barge utilization levels averaged in the low to mid-90% range during the 2023 first quarter compared to the mid-80% range during the 2022 first quarter.
+Added: The 2023 first quarter reflected increasing activity levels as a result of higher refinery and petrochemical plant utilization while the 2022 first quarter was impacted by the COVID-19 Omicron variant as increased cases among the Company’s mariners led to crewing challenges.
+Added: Coastal tank barge utilization levels averaged in the mid to high-90% range during the 2023 first quarter compared to the low-90% range during the 2022 first quarter.
+Added: The increase in coastal tank barge utilization during 2023 was primarily due to continued improvements in market and customer demand.
+Added: During the 2023 first quarter, approximately 55% of KMT inland revenues were under term contracts and 45% were spot contract revenues.
+Added: During the 2022 first quarter, approximately 65% of KMT inland revenues were under term contracts and 35% were spot contract revenues.
+Added: Inland time charters during the 2023 first quarter represented 60% of the inland revenues under term contracts compared with 58% in the 2022 first quarter.
+Added: During the 2023 first quarter, approximately 75% of KMT coastal inland revenues were under term contracts and 25% were spot contracts, respectively.
+Added: During the 2022 first quarter, approximately 80% of the coastal revenues were under term contracts and 20% were spot contract revenues.
+Added: Coastal time charters represented approximately 90% of coastal revenues under term contracts during both the 2023 and 2022 first quarters.
Term contracts have contract terms of 12 months or longer, while spot contracts have contract terms of less than 12 months.
2 unchanged sentences
March 31, 2023
−Removed: June 30, 2022
−Removed: September 30, 2022
Inland market:
5 unchanged sentences
(a) Spot and term contract pricing in the coastal market are contingent on various factors including geographic location, vessel capacity, vessel type, and product serviced.
−Removed: Contract pricing in the coastal marine market continued to be impacted by the oversupply of tank barges in the coastal industry in 2022 and 2021.
Effective January 1, 2023, annual escalators for labor and the producer price index on a number of inland multi-year contracts resulted in rate increases on those contracts of approximately 9%, excluding fuel.
−Removed: KMT operating margin was 9.6% and 7.5% for the 2022 third quarter and first nine months, respectively, compared to 5.0% and 3.8% for the 2021 third quarter and first nine months, respectively.
+Added: KMT operating margin was 10.4% for the 2023 first quarter compared to 4.8% for the 2022 first quarter.
Distribution and Services
1 unchanged sentence
The Company also rents equipment including generators, industrial compressors, high capacity lift trucks, and refrigeration trailers for use in a variety of industrial markets, manufactures and remanufactures oilfield service equipment, including pressure pumping units, and manufactures cementing and pumping equipment as well as coil tubing and well intervention equipment, electric power generation equipment, specialized electric distribution and control equipment, and high capacity energy storage/battery systems for oilfield service and railroad customers.
−Removed: For both the 2022 third quarter and first nine months, KDS generated 42% of the Company’s revenues, of which 83% and 80%, respectively, were generated from service and parts and 17% and 20%, respectively, from manufacturing.
+Added: For the 2023 first quarter, KDS generated 45% of the Company’s revenues, of which 77% were generated from service and parts and 23% from manufacturing.
The results of KDS are largely influenced by the economic cycles of the oil and gas, marine, power generation, on-highway, and other related industrial markets.
−Removed: KDS revenues for the 2022 third quarter and first nine months increased 20% and 26%, respectively, and operating income increased 102% and 149%, respectively, compared with the 2021 third quarter and first nine months.
−Removed: In the commercial and industrial market, the increases for the 2022 third quarter and first nine months were primarily attributable to strong economic activity across the United States which resulted in higher business levels in the marine and on-highway businesses.
−Removed: Increased product sales in Thermo King also contributed favorably to the 2022 third quarter and first nine months results.
+Added: KDS revenues for the 2023 first quarter increased 32% and operating income increased 108% compared with the 2022 first quarter.
+Added: In the commercial and industrial market, the increases for the 2023 first quarter were primarily attributable to strong economic activity across the United States which resulted in higher business levels in the marine and on-highway businesses.
+Added: Increased product sales in Thermo King also contributed favorably to the 2023 first quarter results.
These increases were partially offset by continuing supply chain constraints and delays.
−Removed: The 2021 first nine months was impacted by Winter Storm Uri which caused reduced activity, especially in the Southern United States, in the commercial and industrial market.
−Removed: For the 2022 third quarter and first nine months, the commercial and industrial market contributed 53% and 55%, respectively, of KDS revenues.
−Removed: In the oil and gas market, revenues and operating income improved compared to the 2021 third quarter and first nine months due to higher oilfield activity which resulted in increased demand for new transmissions and parts in the distribution business.
+Added: For the 2023 first quarter, the commercial and industrial market contributed 56% of KDS revenues.
+Added: In the oil and gas market, revenues and operating income improved compared to the 2022 first quarter due to higher oilfield activity which resulted in increased demand for new transmissions and parts in the distribution business.
Although the manufacturing business was heavily impacted by supply chain delays, the business continued to experience increased orders and deliveries of new environmentally friendly pressure pumping equipment and power generation equipment for electric fracturing.
−Removed: For the 2022 third quarter and first nine months, the oil and gas market contributed 47% and 45%, respectively, of KDS revenues.
−Removed: KDS operating margin was 7.1% and 5.8% for the 2022 third quarter and first nine months, respectively, compared to 4.2% and 2.9% for the 2021 third quarter and first nine months, respectively.
+Added: For the 2023 first quarter, the oil and gas market contributed 44% of KDS revenues.
+Added: KDS operating margin was 6.7% for the 2023 first quarter compared to 4.3% for the 2022 first quarter.
Refinery and petrochemical utilization levels remain at high levels.
−Removed: This is favorable for the Company's barge utilization, which is strong in both inland and coastal markets, and pricing, which continues to increase.
−Removed: In KDS, despite ongoing supply chain constraints and delays, demand for the Company's products and services continues to grow.
−Removed: Overall, the Company expects both KMT and KDS to deliver improved financial results in 2022 and going into 2023.
−Removed: The Company continues to closely monitor the ever-changing economic landscape related to the impact of higher interest rates and possible recessionary headwinds as it moves into 2023.
−Removed: In the inland marine transportation market, conditions are expected to continue to improve driven by increased barge utilization, improvements in the spot market, and renewals of expiring term contracts at higher rates.
−Removed: The impacts of rising costs from inflationary pressures, including significantly higher fuel prices, are expected to be recovered as term contracts renew and contract escalators reprice in the fourth quarter and into 2023.
−Removed: An increase in delay days due to normal seasonal conditions and the impact of record low water on the Mississippi River is expected in the fourth quarter.
−Removed: In coastal marine, modest improvements in demand and pricing are anticipated in the 2022 fourth quarter, but revenues and operating income are expected to be impacted by planned shipyard maintenance and ballast water treatment installations on certain vessels for the remainder of the year.
+Added: This is favorable for the Company’s barge utilization, which is strong in both inland and coastal markets, and for pricing, which continues to increase.
+Added: Although first quarter results were materially challenged by bad weather in KMT, the business exited the quarter in a solid position and improved results are anticipated through the remainder of 2023.
+Added: Demand for the Company’s products and services continues to grow despite ongoing supply chain constraints and delays which could impact the Company’s product deliveries and defer completion of marine transportation repair and maintenance.
+Added: Overall, the Company expects both KMT and KDS to deliver improved financial results in the coming quarters.
+Added: The Company continues to closely monitor the ever-changing economic landscape related to the impact of higher interest rates and possible recessionary headwinds as it continues to move through 2023.
+Added: In the inland marine transportation market, conditions are expected to continue to remain favorable for the remainder of 2023 driven by continued strong barge utilization, continued growth in customer demand, steady volumes from refinery and petrochemical plants, and modest net new barge construction in the industry.
+Added: As a result, the Company expects further improvements in the spot market, which currently represents approximately 45% of inland revenues.
+Added: Term contracts are also expected to continue to reset higher to reflect improved market conditions for the duration of the year.
+Added: In coastal marine, the Company expects modestly improved customer demand through the balance of the year with barge utilization in the low to mid-90% range.
+Added: Rates are expected to continue to gradually improve, though meaningful gains remain challenged by underutilized barge capacity across the industry.
+Added: Revenues and operating margins are also expected to be impacted by an approximate doubling of planned shipyard maintenance days with ballast water treatment installations on certain vessels.
KDS results are largely influenced by the cycles of the oil and gas, marine, power generation, on-highway and other related industrial markets.
−Removed: In the oil and gas market, high commodity prices, increasing rig counts, and growing well completions activity are expected to result in increased demand for original equipment manufacturer products, parts, and services as well as for new environmentally friendly pressure pumping equipment and power generation equipment for electric fracturing.
−Removed: In commercial and industrial, favorable economic activity is expected to result in increased demand in power generation, marine repair, and on-highway.
−Removed: However, ongoing supply chain issues and long lead times are expected in the near term, contributing to some volatility as deliveries of products possibly shift into future quarters.
+Added: Favorable oilfield fundamentals and steady demand in commercial and industrial are expected to continue throughout 2023.
+Added: In the oil and gas market, high commodity prices, stable rig counts, and growing well completions activity are expected to yield strong demand for OEM products, parts, and services in the distribution business.
+Added: In manufacturing, the Company expects demand for environmentally friendly pressure pumping and power generation equipment for electric fracturing to remain strong, with new orders and increased deliveries of new equipment during the year.
+Added: Supply chain issues and long lead times are expected to persist in the near-term, contributing to some volatility as deliveries of new products shift between quarters and into 2024.
+Added: In commercial and industrial, strong markets are expected to help drive full year revenue growth, with increased activity in power generation, marine repair, and on-highway.
On March 31, 2022, the Company paid $3.9 million in cash to purchase assets of a gearbox repair company in KDS.
−Removed: During the nine months ended September 30, 2021, the Company purchased four inland tank barges from a leasing company for $7.5 million in cash.
−Removed: The Company had been leasing the barges prior to the purchase.
Financing of the purchases was through cash provided by operating activities.
1 unchanged sentence
The following table sets forth the Company’s KMT and KDS revenues and the percentage of each to total revenues (dollars in thousands):
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
Marine transportation
2 unchanged sentences
The following table sets forth KMT revenues, costs and expenses, operating income, and operating margin (dollars in thousands):
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
Marine transportation revenues
8 unchanged sentences
The following table shows the marine transportation markets serviced by the Company, KMT revenue distribution, products moved and the drivers of the demand for the products the Company transports:
−Removed: 2022 Third Quarter
−Removed: 2022 Nine Months
+Added: 2023 First Quarter
Products Moved
13 unchanged sentences
Corn, Cotton and Wheat Production, Chemical Feedstock Usage
−Removed: KMT revenues for the 2022 third quarter and first nine months increased 28% and 23%, respectively, compared to the 2021 third quarter and first nine months revenues.
−Removed: The increase for the 2022 third quarter and first nine months was primarily due to increased tank barge utilization, higher term and spot pricing, and higher fuel rebills in the inland and coastal markets.
−Removed: The 2021 first nine months was also heavily impacted by Winter Storm Uri which shut down many Gulf Coast refineries and chemical plants for an extended period of time starting in mid-February.
−Removed: These emergency shutdowns resulted in significantly reduced liquids production and lower volumes for the Company’s inland marine transportation market during the 2021 first quarter.
−Removed: The 2021 first nine months revenues and operating income were also impacted by Hurricane Ida in the 2021 third quarter which shuttered almost the entire Southeast Louisiana refinery and chemical complex and key waterways for an extended period of time.
−Removed: The 2022 and 2021 first quarters were impacted by poor operating conditions including seasonal wind and fog along the Gulf Coast, flooding on the Mississippi River, and various lock closures along the Gulf Intracoastal Waterway, in addition to ice on the Illinois River.
−Removed: For the 2022 third quarter and first nine months, the inland tank barge fleet contributed 80% and 79%, respectively, and the coastal fleet contributed 20% and 21%, respectively, of KMT revenues.
−Removed: For the 2021 third quarter and first nine months, the inland tank barge fleet contributed 76% and 75%, respectively, and the coastal fleet contributed 24% and 25%, respectively, of KMT revenues.
−Removed: Inland tank barge utilization levels averaged in the mid-80% range during the 2022 first quarter, the low 90% range during the 2022 second and third quarters compared to the mid-70% range during the 2021 first quarter, the low to mid-80% range during the 2021 second quarter, and the low 80% range during the 2021 third quarter.
−Removed: The 2022 first nine months reflected increasing activity levels as a result of higher refinery and petrochemical plant utilization while the 2021 first nine months was impacted by reduced demand resulting from the effects of the COVID-19 pandemic causing an economic slowdown as well as reduced volumes due to Winter Storm Uri during the 2021 first quarter and Hurricane Ida during the 2021 third quarter, partially offset by the Colonial Pipeline outage which increased barge transportation activity in the 2021 second quarter.
−Removed: Coastal tank barge utilization levels averaged in the low 90% range during the 2022 first and second quarters and the low to mid-90% range during the 2022 third quarter compared to the mid-70% range during the 2021 first and third quarters and the low to mid-70% range during the 2021 second quarter.
−Removed: The increase in coastal tank barge utilization during 2022 was primarily due to the retirement of underutilized barges in the 2021 third quarter and some modest improvements in customer demand.
−Removed: The petrochemical market, which is the Company’s largest market, contributed 50% and 49% of KMT revenues for the 2022 third quarter and first nine months, respectively, reflecting increased volumes and utilization from Gulf Coast petrochemical plants as a result of improved economic conditions following the height of the COVID-19 pandemic.
−Removed: The black oil market, which contributed 28% of KMT revenues for both the 2022 third quarter and first nine months, reflected improved demand as refinery utilization and production levels of refined petroleum products and fuel oils increased following the height of the COVID-19 pandemic.
−Removed: During the 2022 first nine months, the Company transported crude oil and natural gas condensate produced from the Permian Basin and the Eagle Ford shale formation in Texas, both along the Gulf Intracoastal Waterway with inland vessels and in the Gulf of Mexico with coastal equipment.
+Added: KMT revenues for the 2023 first quarter increased 16% compared to the 2022 first quarter revenues.
+Added: The increase for the 2023 first quarter was primarily due to higher term and spot pricing, increased tank barge utilization, and higher fuel rebills in the inland and coastal markets.
+Added: Also, the 2022 first quarter was impacted by the COVID-19 Omicron variant as increased cases among the Company’s mariners led to crewing challenges, lost revenue and increased operating costs.
+Added: The 2023 and 2022 first quarters were impacted by poor operating conditions including seasonal wind and fog along the Gulf Coast and lock delays on the Mississippi and Illinois rivers resulting in higher delay days.
+Added: For the 2023 first quarter, the inland tank barge fleet contributed 82% and the coastal fleet contributed 18% of KMT revenues.
+Added: For the 2022 first quarter, the inland tank barge fleet contributed 78% and the coastal fleet contributed 22% of KMT revenues.
+Added: Inland tank barge utilization levels averaged in the low to mid-90% range during the 2023 first quarter compared to the mid-80% range during the 2022 first quarter.
+Added: The 2023 first quarter reflected increasing activity levels as a result of higher refinery and petrochemical plant utilization while the 2022 first quarter was impacted by the COVID-19 Omicron variant as increased cases among the Company’s mariners led to crewing challenges.
+Added: Coastal tank barge utilization levels averaged in the mid to high-90% range during the 2023 first quarter compared to the low-90% range during the 2022 first quarter.
+Added: The increase in coastal tank barge utilization during 2023 was primarily due to continued improvements in market and customer demand.
+Added: The petrochemical market, which is the Company’s largest market, contributed 50% of KMT revenues for the 2023 first quarter reflecting increased rates, volumes and utilization from Gulf Coast petrochemical plants as a result of improved economic conditions as compared to the 2022 first quarter.
+Added: The black oil market, which contributed 26% of KMT revenues for the 2023 first quarter, reflected improved demand as refinery utilization and production levels of refined petroleum products and fuel oils increased.
+Added: During the 2023 first quarter, the Company transported crude oil and natural gas condensate produced from the Permian Basin and the Eagle Ford shale formation in Texas, both along the Gulf Intracoastal Waterway with inland vessels and in the Gulf of Mexico with coastal equipment.
Additionally, the Company transported volumes of Utica natural gas condensate downriver from the Mid-Atlantic to the Gulf Coast and Canadian and Bakken crude downriver from the Midwest to the Gulf Coast.
−Removed: The refined petroleum products market, which contributed 19% and 20% of KMT revenues for the 2022 third quarter and first nine months, respectively, reflected increased volumes in the inland market as refinery utilization and product levels improved following the height of the COVID-19 pandemic.
−Removed: The agricultural chemical market, which contributed 3% of KMT revenues for both the 2022 third quarter and first nine months, reflected improved demand for transportation of both domestically produced and imported products, primarily due to improved economic conditions following the height of the COVID-19 pandemic.
−Removed: For the 2022 third quarter, the inland operations incurred 1,253 delay days, 16% fewer than the 1,499 delay days that occurred during the 2021 third quarter.
−Removed: For the 2022 first nine months, the inland operations incurred 7,152 delay days, 2% fewer than the 7,275 delay days that occurred during the 2021 first nine months.
+Added: The refined petroleum products market, which contributed 21% of KMT revenues for the 2023 first quarter, reflected increased volumes in the inland market with improved refinery utilization and product levels.
+Added: The agricultural chemical market, which contributed 3% of KMT revenues for both the 2023 first quarter, reflected improved demand for transportation of both domestically produced and imported products.
+Added: For the 2023 first quarter, the inland operations incurred 4,125 delay days, 31% more than the 3,137 delay days that occurred during the 2022 first quarter.
Delay days measure the lost time incurred by a tow (towboat and one or more tank barges) during transit when the tow is stopped due to weather, lock conditions, or other navigational factors.
−Removed: Delay days reflected poor operating conditions due to heavy wind and fog along the Gulf Coast and high water conditions on the Mississippi River System during the 2022 and 2021 first quarters.
−Removed: The 2022 first quarter was also impacted by ice on the Illinois River while the 2021 first quarter was impacted by closures of key waterways as a result of lock maintenance projects.
−Removed: During both the 2022 third quarter and first nine months, approximately 60% of KMT inland revenues were under term contracts and 40% were spot contract revenues.
−Removed: During both the 2021 third quarter and first nine months, approximately 65% of KMT inland revenues were under term contracts and 35% were spot contract revenues.
−Removed: Inland time charters during the 2022 third quarter and first nine months represented 56% and 57%, respectively, of the inland revenues under term contracts compared with 56% and 58% in the 2021 third quarter and first nine months, respectively.
−Removed: During the 2022 third quarter and first nine months, approximately 65% and 75%, respectively, of KMT coastal inland revenues were under term contracts and 35% and 25%, respectively, were spot contracts.
−Removed: During both the 2021 third quarter and first nine months, approximately 80% of the coastal revenues were under term contracts and 20% were spot contract revenues.
−Removed: Coastal time charters represented approximately 90% of coastal revenues under term contracts during both the 2022 third quarter and first nine months compared with approximately 85% during both the 2021 third quarter and first nine months.
+Added: Delay days reflected poor operating conditions due to heavy wind and fog along the Gulf Coast and lock delays on the Mississippi and Illinois rivers during the 2023 and 2022 first quarters.
+Added: During the 2023 first quarter, approximately 55% of KMT inland revenues were under term contracts and 45% were spot contract revenues.
+Added: During the 2022 first quarter, approximately 65% of KMT inland revenues were under term contracts and 35% were spot contract revenues.
+Added: Inland time charters during the 2023 first quarter represented 60% of the inland revenues under term contracts compared with 58% in the 2022 first quarter, respectively.
+Added: During the 2023 first quarter, approximately 75% of KMT coastal inland revenues were under term contracts and 25% were spot contracts.
+Added: During the 2022 first quarter, approximately 80% of the coastal revenues were under term contracts and 20% were spot contract revenues.
+Added: Coastal time charters represented approximately 90% of coastal revenues under term contracts during both the 2023 and 2022 first quarters.
Term contracts have contract terms of 12 months or longer, while spot contracts have contract terms of less than 12 months.
2 unchanged sentences
March 31, 2023
−Removed: June 30, 2022
−Removed: September 30, 2022
Inland market:
5 unchanged sentences
(a) Spot and term contract pricing in the coastal market are contingent on various factors including geographic location, vessel capacity, vessel type, and product serviced.
−Removed: Contract pricing in the coastal marine market continued to be impacted by the oversupply of tank barges in the coastal industry in 2022 and 2021.
Effective January 1, 2023, annual escalators for labor and the producer price index on a number of inland multi-year contracts resulted in rate increases on those contracts of approximately 9%, excluding fuel.
Marine Transportation Costs and Expenses
−Removed: Costs and expenses for the 2022 third quarter and first nine months increased 22% and 18%, respectively, compared to the 2021 third quarter and first nine months.
−Removed: Costs of sales and operating expenses for the 2022 third quarter and first nine months increased 29% and 26%, respectively, compared with the 2021 third quarter and first nine months.
−Removed: The increases during the 2022 third quarter and first nine months primarily reflect improved business activity levels and increased fuel costs as well as incremental costs associated with the COVID-19 Omicron variant during the 2022 first quarter.
−Removed: The inland marine transportation fleet operated an average of 274 towboats during the 2022 third quarter, of which an average of 59 were chartered, compared to 243 during the 2021 third quarter, of which an average of 30 were chartered.
−Removed: The increase was primarily due to increasing business activity levels during the 2022 third quarter.
+Added: Costs and expenses for the 2023 first quarter increased 9%, respectively, compared to the 2022 first quarter.
+Added: Costs of sales and operating expenses for the 2023 first quarter increased 11%, respectively, compared with the 2022 first quarter.
+Added: The increases during the 2023 first quarter primarily reflect improved business activity levels, inflationary cost pressures and increased fuel costs.
+Added: The 2022 first quarter was negatively impacted by incremental costs associated with the COVID-19 Omicron variant.
+Added: The inland marine transportation fleet operated an average of 282 towboats during the 2023 first quarter, of which an average of 66 were chartered, compared to 263 during the 2022 first quarter, of which an average of 56 were chartered.
+Added: The increase was primarily due to increasing business activity levels during the 2023 first quarter.
The Company charters in or releases chartered towboats in an effort to balance horsepower needs with current requirements, taking into account variability in demand or anticipated demand, addition or removal of tank barges from the fleet, chartered towboat availability, and weather or water conditions.
The Company has historically used chartered towboats for approximately one-fourth of its horsepower requirements.
−Removed: During the 2022 third quarter, the inland operations consumed 12.5 million gallons of diesel fuel compared to 11.8 million gallons consumed during the 2021 third quarter.
−Removed: The average price per gallon of diesel fuel consumed during the 2022 third quarter was $4.24 per gallon compared with $2.24 per gallon for the 2021 third quarter.
−Removed: During the 2022 first nine months, the inland operations consumed 36.7 million gallons of diesel fuel compared to 34.4 million gallons consumed during the 2021 first nine months.
−Removed: The average price per gallon of diesel fuel consumed during the 2022 first nine months was $3.60 per gallon compared with $1.99 per gallon for the 2021 first nine months.
+Added: During the 2023 first quarter, the inland operations consumed 12.2 million gallons of diesel fuel compared to 11.5 million gallons consumed during the 2022 first quarter.
+Added: The average price per gallon of diesel fuel consumed during the 2023 first quarter was $3.31 per gallon compared with $2.50 per gallon for the 2022 first quarter.
Fuel escalation and de-escalation clauses are typically included in term contracts and are designed to rebate fuel costs when prices decline and recover additional fuel costs when fuel prices rise;
1 unchanged sentence
Spot contracts do not have escalators for fuel.
−Removed: Selling, general and administrative expenses for the 2022 third quarter and first nine months increased 11% and 6%, respectively, compared to the 2021 third quarter and first nine months as the Company manages inflationary cost pressures.
−Removed: The increase for the 2022 third quarter was primarily due to salary and wage increases effective July 1, 2022 and increased incentive compensation accruals as a result of higher business activity levels.
−Removed: Business activity levels in the 2021 first nine months were impacted by COVID-19 and the resulting economic slowdown as well as Winter Storm Uri during the 2021 first quarter and Hurricane Ida during the 2021 third quarter.
−Removed: Depreciation and amortization for the 2022 third quarter and first nine months decreased 5% and 6%, respectively, compared to the 2021 third quarter and first nine months, primarily reflecting retirements, sales, and impairment of marine equipment during 2021 and 2022.
+Added: Selling, general and administrative expenses for the 2023 first quarter increased 8% compared to the 2022 first quarter due to higher business activity levels and inflationary cost pressures.
+Added: The increase for the 2023 first quarter was also due to salary and wage increases which went into effect July 1, 2022.
Marine Transportation Operating Income and Operating Margin
−Removed: KMT operating income for the 2022 third quarter and first nine months increased 147% and 140%, respectively, compared with the 2021 third quarter and first nine months.
−Removed: The 2022 third quarter operating margin was 9.6% compared with 5.0% for the 2021 third quarter.
−Removed: The 2022 first nine months operating margin was 7.5% compared with 3.8% for the 2021 first nine months.
−Removed: The increases in operating income and operating margin were primarily due to increased barge utilization and higher term and spot contract pricing in the inland and coastal markets, each as a result of improving business activity levels, partially offset by increasing fuel prices as well as the impacts of the COVID-19 Omicron variant during the 2022 first quarter.
−Removed: The 2021 first nine months activity levels were also impacted by Winter Storm Uri and Hurricane Ida.
+Added: KMT operating income for the 2023 first quarter increased 154% compared with the 2022 first quarter.
+Added: The 2023 first quarter operating margin was 10.4% compared with 4.8% for the 2022 first quarter.
+Added: The increases in operating income and operating margin were primarily due to higher term and spot contract pricing and increased barge utilization in the inland and coastal markets, each as a result of improving business activity levels, partially offset by increasing fuel prices.
+Added: The 2022 first quarter was negatively impacted by the COVID-19 Omicron variant as increased cases among the Company’s mariners led to crewing challenges, lost revenue and increased operating costs.
Distribution and Services
The following table sets forth KDS revenues, costs and expenses, operating income, and operating margin (dollars in thousands):
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
Distribution and services revenues
9 unchanged sentences
Markets Serviced
−Removed: 2022 Third Quarter
−Removed: 2022 Nine Months
+Added: 2023 First Quarter
Commercial and Industrial
4 unchanged sentences
Oilfield Services, Oil and Gas Operators and Producers
−Removed: KDS revenues for the 2022 third quarter and first nine months increased 20% and 26%, respectively, compared to the 2021 third quarter and first nine months.
−Removed: In the commercial and industrial market, the increase for the 2022 third quarter and first nine months was primarily attributable to strong economic activity across the United States which resulted in higher business levels in the marine and on-highway businesses.
−Removed: Increased product sales in Thermo King also contributed favorably to the 2022 third quarter and first nine months results.
+Added: KDS revenues for the 2023 first quarter increased 32% compared to the 2022 first quarter.
+Added: In the commercial and industrial market, the increase for the 2023 first quarter was primarily attributable to strong economic activity across the United States which resulted in higher business levels in the marine and on-highway businesses.
+Added: Increased product sales in Thermo King also contributed favorably to the 2023 first quarter results.
These increases were partially offset by continuing supply chain constraints and delays.
−Removed: The 2021 first nine months was impacted by Winter Storm Uri which caused reduced activity, especially in the Southern United States, in the commercial and industrial market.
−Removed: For the 2022 third quarter and first nine months, the commercial and industrial market contributed 53% and 55%, respectively, of KDS revenues.
−Removed: In the oil and gas market, revenues improved compared to the 2021 third quarter and first nine months due to higher oilfield activity which resulted in increased demand for new transmissions and parts in the distribution business.
−Removed: Although the manufacturing business was heavily impacted by supply chain delays, the business continued to experience increased orders and deliveries of new environmentally friendly pressure pumping equipment and power generation equipment for electric fracturing.
−Removed: For the 2022 third quarter and first nine months, the oil and gas market contributed 47% and 45%, respectively, of KDS revenues.
+Added: For the 2023 first quarter, the commercial and industrial market contributed 56% of KDS revenues.
+Added: In the oil and gas market, revenues improved compared to the 2022 first quarter due to higher oilfield activity which resulted in increased demand for new transmissions and parts in the distribution business.
+Added: Although the manufacturing business was heavily impacted by supply chain delays, the business continued to experience increased orders and deliveries of new environmentally friendly
+Added: pressure pumping equipment and power generation equipment for electric fracturing.
+Added: For the 2023 first quarter, the oil and gas market contributed 44% of KDS revenues.
Distribution and Services Costs and Expenses
−Removed: Costs and expenses for the 2022 third quarter and first nine months increased 17% and 22%, respectively, compared with the 2021 third quarter and first nine months.
−Removed: Costs of sales and operating expenses for the 2022 third quarter and first nine months increased 18% and 25%, respectively, compared with the 2021 third quarter and first nine months, reflecting higher demand in the marine and on-highway businesses in commercial and industrial markets as well as increased demand in the oil and gas market as a result of higher oilfield activity levels.
−Removed: Selling, general and administrative expenses for the 2022 third quarter and first nine months increased 12% and 17%, respectively, compared to the 2021 third quarter and first nine months, primarily due to salaries and costs related to the acquisition of assets of an energy storage systems manufacturer in the 2021 fourth quarter which included engineering talent required to further the Company’s electrification efforts, continued inflationary cost pressures, annual salary raises and severance expense.
−Removed: Depreciation and amortization for the 2022 third quarter and first nine months decreased 15% and 25%, respectively, compared to the 2021 third quarter and first nine months, primarily due to sales of property and equipment and reduced capital spending during 2021.
+Added: Costs and expenses for the 2023 first quarter increased 29% compared with the 2022 first quarter.
+Added: Costs of sales and operating expenses for the 2023 first quarter increased 32% compared with the 2022 first quarter, reflecting higher demand in the marine and on-highway businesses in commercial and industrial markets as well as increased demand in the oil and gas market as a result of higher oilfield activity levels.
+Added: Selling, general and administrative expenses for the 2023 first quarter increased 17% compared to the 2022 first quarter, primarily due to continued inflationary cost pressures, higher business activity and annual compensation increases.
Distribution and Services Operating Income and Operating Margin
−Removed: KDS operating income for the 2022 third quarter and first nine months increased 102% and 149%, respectively, compared with the 2021 third quarter and first nine months.
−Removed: The 2022 third quarter operating margin was 7.1% compared with 4.2% for the 2021 third quarter.
−Removed: The 2022 first nine months operating margin was 5.8% compared to 2.9% for the 2021 first nine months.
+Added: KDS operating income for the 2023 first quarter increased 108% compared with the 2022 first quarter.
+Added: The 2023 first quarter operating margin was 6.7% compared to 4.3% for the 2022 first quarter.
The results reflect increased business levels in both the commercial and industrial and oil and gas markets.
Gain on Disposition of Assets
−Removed: The Company reported a net gain on disposition of assets of $0.4 million for the 2022 third quarter and $0.8 million for the 2021 third quarter.
−Removed: The Company reported a net gain on disposition of assets of $8.0 million for the 2022 first nine months and $5.1 million for the 2021 first nine months.
+Added: The Company reported a net gain on disposition of assets of $2.2 million for the 2023 first quarter and $4.8 million for the 2022 first quarter.
The net gains were primarily from sales of marine transportation equipment.
1 unchanged sentence
The following table sets forth impairments, other income, noncontrolling interests, and interest expense (dollars in thousands):
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
Noncontrolling interests
Interest expense
−Removed: For 2021, impairments includes $340.7 million before taxes, $275.1 million after taxes, or $4.58 per share, non-cash charges related to impairment of long-lived assets related to coastal marine transportation equipment and impairment of goodwill in the marine transportation segment.
−Removed: Other income for the 2022 and 2021 third quarters include income of $3.5 million and $1.7 million, respectively, and the 2022 and 2021 first nine months include income of $10.3 million and $6.0 million, respectively, for all components of net benefit costs except the service cost component related to the Company’s defined benefit plans.
−Removed: Other income for the 2022 first nine months also reflects lower interest income compared to the 2021 first nine months related to the Company's federal income tax refunds.
+Added: Other income for the 2023 and 2022 first quarters include income of $1.2 million and $3.4 million, respectively, for all components of net benefit costs except the service cost component related to the Company’s defined benefit plans.
+Added: The 2023 first quarter also includes interest income associated with the IRS refund.
Interest Expense
The following table sets forth average debt and average interest rate (dollars in thousands):
−Removed: Three Months Ended September 30,
−Removed: Nine Months Ended September 30,
+Added: Three Months Ended March 31,
Average interest rate
−Removed: Interest expense for the 2022 third quarter and first nine months increased 12% and 1%, respectively, compared with the 2021 third quarter and first nine months, primarily due to a higher average interest rate, partially offset by a lower average debt outstanding as a result of debt repayments during 2021 and 2022.
−Removed: There was no capitalized interest excluded from interest expense during the 2022 or 2021 first nine months.
+Added: Interest expense for the 2023 first quarter increased 30% compared with the 2022 first quarter, primarily due to a higher average interest rate and slightly higher average debt outstanding.
+Added: There was no capitalized interest excluded from interest expense during the 2023 or 2022 first quarter.
Financial Condition, Capital Resources and Liquidity
1 unchanged sentence
The following table sets forth the significant components of the balance sheets (dollars in thousands):
−Removed: September 30,
Current assets
10 unchanged sentences
Other long-term liabilities
−Removed: Current assets as of September 30, 2022 increased 12% compared with December 31, 2021.
+Added: Current assets as of March 31, 2023 decreased 1% compared with December 31, 2022.
Trade accounts receivable increased 9%, primarily due to increased business activity levels in both KMT and KDS.
−Removed: Other accounts receivable decreased 11%, primarily due to recoveries on the settlement of insurance claims.
−Removed: Inventories increased by 18% due to higher activity and the impact of supply chain delays in KDS resulting in buildup for projects that will be delivered later in 2022 and into 2023.
−Removed: Prepaid expenses and other current assets increased 16% primarily due to the increase in the price of diesel fuel purchased in September 2022.
−Removed: Property and equipment, net of accumulated depreciation, at September 30, 2022 decreased 1% compared with December 31, 2021.
−Removed: The decrease reflected $144.8 million of depreciation expense and $26.0 million of property disposals, partially offset by $129.1 million of capital additions (including an increase in accrued capital expenditures of $8.5 million) and an acquisition for $3.9 million during the 2022 first nine months, more fully described under Cash Flows and Capital Expenditures below.
−Removed: Operating lease right-of-use assets as of September 30, 2022 decreased 8% compared to December 31, 2021, primarily due to lease amortization expense, partially offset by new leases acquired during the 2022 first nine months.
−Removed: Other intangibles, net, as of September 30, 2022 decreased 11% compared with December 31, 2021, primarily due to amortization during the 2022 first nine months.
−Removed: Other assets as of September 30, 2022 decreased 14% compared with December 31, 2021, primarily due to amortization of drydock expenditures, partially offset by additional deferred major maintenance drydock expenditures incurred during the 2022 first nine months.
−Removed: Current liabilities as of September 30, 2022 increased 5% compared with December 31, 2021.
−Removed: Accounts payable increased 21% primarily due to increased activity levels in KMT and KDS.
−Removed: Deferred revenue increased 13% primarily due to deposits on equipment expected to be shipped in the 2022 fourth quarter and into 2023 in KDS.
−Removed: Accrued liabilities decreased 11% primarily due to the settlement of insurance claims.
+Added: Inventories increased by 3% due to higher activity and the impact of supply chain delays in KDS resulting in buildup for projects that will be delivered later in 2023.
+Added: Prepaid expenses and other current assets decreased 13% primarily due to amortization of insurance premiums and the sale of assets held for sale.
+Added: Property and equipment, net of accumulated depreciation, at March 31, 2023 increased 1% compared with December 31, 2022.
+Added: The increase reflected $81.4 million of capital additions (including an increase in accrued capital expenditures of $8.2 million), partially offset by $49.2 million of depreciation expense and $0.2 million of property disposals more fully described under Cash Flows and Capital Expenditures below.
+Added: Operating lease right-of-use assets as of March 31, 2023 increased 1% compared to December 31, 2022, primarily due to new leases acquired during the 2023 first quarter, partially offset by lease amortization expense.
+Added: Other intangibles, net, as of March 31, 2023 decreased 4% compared with December 31, 2022, primarily due to amortization during the 2023 first quarter.
+Added: Other assets as of March 31, 2023 increased 1% compared with December 31, 2022, primarily due to additional deferred major maintenance drydock expenditures incurred during the 2023 first quarter partially offset by amortization of drydock expenditures.
+Added: Current liabilities as of March 31, 2023 decreased 4% compared with December 31, 2022.
+Added: Accrued liabilities decreased 15% primarily due to the payment of employee incentive compensation bonuses, property taxes, and interest.
+Added: Deferred revenue increased 4% primarily due to deposits on equipment expected to be shipped later in 2023 in KDS.
Long-term debt, net –
−Removed: less current portion, as of September 30, 2022 decreased 4% compared with December 31, 2021, primarily reflecting repayments under the term loan partially offset by borrowings under the 2027 Revolving Credit Facility.
−Removed: Deferred income taxes as of September 30, 2022 increased 5% compared with December 31, 2021, primarily reflecting the deferred tax provision of $26.0 million.
+Added: less current portion, as of March 31, 2023 was flat compared with December 31, 2022, primarily reflecting the maturity of the 3.29% senior notes due February 27, 2023, offset by borrowings under the 3.46% and 3.51% senior notes due January 19, 2033 and the 2027 Revolving Credit Facility.
+Added: Deferred income taxes as of March 31, 2023 increased 2% compared with December 31, 2022, primarily reflecting the deferred tax provision of $12.6 million.
Operating lease liabilities –
−Removed: less current portion, as of September 30, 2022 decreased 10% compared to December 31, 2021, primarily due to lease payments made, partially offset by new leases acquired and liability accretion during the 2022 first nine months.
−Removed: Other long-term liabilities as of September 30, 2022 decreased 34% compared with December 31, 2021, primarily due to amortization of intangible liabilities and a decrease in pension liabilities.
−Removed: Total equity as of September 30, 2022 increased 3% compared with December 31, 2021.
−Removed: The increase was primarily due to the net earnings attributable to Kirby of $85.0 million, amortization of share-based compensation of $11.4 million, and stock option exercises of $3.9 million, partially offset by treasury stock purchases of $22.9 million and tax withholdings of $3.2 million on restricted stock and RSU vestings.
+Added: less current portion, as of March 31, 2023 increased 3% compared to December 31, 2022, primarily due to new leases acquired and liability accretion during the 2023 first quarter.
+Added: Other long-term liabilities as of March 31, 2023 decreased 38% compared with December 31, 2022, primarily due to a decrease in pension liabilities and amortization of intangible liabilities.
+Added: Total equity as of March 31, 2023 increased 1% compared with December 31, 2022.
+Added: The increase was primarily due to the net earnings attributable to Kirby of $40.7 million, amortization of share-based compensation of $5.8 million, and stock option exercises of $0.1 million, partially offset by treasury stock purchases of $3.2 million and tax withholdings of $3.6 million on RSU vestings.
Long-Term Financing
The following table summarizes the Company’s outstanding debt (in thousands):
−Removed: September 30,
Long-term debt, including current portion:
1 unchanged sentence
Term Loan due July 29, 2027 (a)
−Removed: Term Loan due March 27, 2024 (b)
3.29% senior notes due February 27, 2023
4.2% senior notes due March 1, 2028
+Added: 3.46% senior notes due January 19, 2033
+Added: 3.51% senior notes due January 19, 2033
Credit line due June 30, 2024
Bank notes payable
−Removed: Unamortized debt discounts and issuance costs (c)
−Removed: (a) Variable interest rate of 4.5% at September 30, 2022.
−Removed: (b) Variable interest rate of 1.5% at December 31, 2021.
−Removed: (c) Excludes $1.4 million attributable to the 2024 Revolving Credit Facility included in other assets at December 31, 2021.
−Removed: At the beginning of the third quarter of 2022, the Company had in place its 2024 Credit Agreement with a group of commercial banks, with JPMorgan Chase Bank, N.A.
+Added: Unamortized debt discounts and issuance costs (b)
+Added: (a) Variable interest rate of 6.3% at March 31, 2023.
+Added: (b) Excludes $1.8 million attributable to the 2027 Revolving Credit Facility included in other assets at December 31, 2022.
+Added: At the beginning of 2022, the Company had in place its 2024 Credit Agreement with a group of commercial banks, with JPMorgan Chase Bank, N.A.
as the administrative agent bank, that allowed for an $850 million 2024 Revolving Credit Facility and a 2024 Term Loan with a maturity date of March 27, 2024.
The 2024 Term Loan was prepayable, in whole or in part, without penalty.
−Removed: On July 29, 2022, the 2024 Credit Agreement was replaced with the 2027 Credit Agreement with a group of commercial banks, with JPMorgan Chase Bank, N.A.
−Removed: as the administrative agent bank that allows for the $500 million 2027 Revolving Credit Facility and the 2027 Term Loan with a maturity date of July 29, 2027.
+Added: On July 29, 2022, the Company entered into a new credit agreement (the “2027 Credit Agreement”) with a group of commercial banks, with JPMorgan Chase Bank, N.A.
+Added: as the administrative agent bank that allows for a $500 million unsecured revolving credit facility (the “2027 Revolving Credit Facility”) and a $250 million unsecured term loan (the “2027 Term Loan”) with a maturity date of July 29, 2027.
+Added: The 2027 Credit Agreement replaced the 2024 Credit Agreement.
In conjunction with entering into the 2027 Credit Agreement, on July 29, 2022, the Company borrowed $35 million under the 2027 Revolving Credit Facility and $250 million under the 2027 Term Loan to repay borrowings under the 2024 Term Loan.
−Removed: In October 2022, the Company repaid $20.0 million under the 2027 Term Loan prior to scheduled maturities.
−Removed: As a result, no repayments are required until September 30, 2023.
−Removed: The 2027 Term Loan is repayable in quarterly installments, scheduled to commence September 30, 2023, in increasing percentages of the original principal amount of the loan, with the remaining unpaid balance of approximately $43.8 million payable upon maturity, assuming no prepayment.
−Removed: The 2027 Term Loan quarterly installments are excluded from short term liabilities because the Company has the ability and intent to refinance these quarterly installments under the 2027 Revolving Credit Facility.
+Added: In the fourth quarter of 2022, the Company repaid $80.0 million under the 2027 Term Loan prior to scheduled maturities.
+Added: As a result, no repayments are required until June 30, 2025.
+Added: Outstanding letters of credit under the 2027 Revolving Credit Facility were $5.1 million and available borrowing capacity was $382.9 million as of March 31, 2023.
+Added: The 2027 Term Loan is repayable in quarterly installments, with no repayments until June 30, 2025, in increasing percentages of the original principal amount of the loan, with the remaining unpaid balance of approximately $43.8 million payable upon maturity, assuming no prepayment.
The 2027 Term Loan is prepayable, in whole or in part, without penalty.
+Added: The 2027 Credit Agreement provides for a variable interest rate based on the Secured Overnight Financing Rate (“SOFR”) or a base rate calculated with reference to the prime rate quoted by The Wall Street Journal, the Federal Reserve Bank of New York Rate plus 0.5%, or the adjusted SOFR rate for a one month interest period plus 1.0%, among other factors (the “Alternate Base Rate”).
+Added: The interest rate varies with the Company’s credit rating and is currently 137.5 basis points over SOFR or 37.5 basis points over the Alternate Base Rate.
+Added: The 2027 Credit Agreement contains certain financial covenants including an interest coverage ratio and debt-to-capitalization ratio.
+Added: In addition to financial covenants, the 2027 Credit Agreement contains covenants that, subject to exceptions, restrict debt incurrence, mergers and acquisitions, sales of assets, dividends and investments, liquidations and dissolutions, capital leases, transactions with affiliates, and changes in lines of business.
+Added: The 2027 Credit Agreement specifies certain events of default, upon the occurrence of which the maturity of the outstanding loans may be accelerated, including the failure to pay principal or interest, violation of covenants and default on other indebtedness, among other events.
+Added: Borrowings under the 2027 Credit Agreement may be used for general corporate purposes including acquisitions.
The 2027 Revolving Credit Facility includes a $25 million commitment which may be used for standby letters of credit.
−Removed: Outstanding letters of credit under the 2027 Revolving Credit Facility were $5.1 million and available borrowing capacity was $474.9 million as of September 30, 2022.
−Removed: Outstanding letters of credit under the $10 million credit line were $1.4 million and available borrowing capacity was $8.6 million as of September 30, 2022.
−Removed: On February 3, 2022, the Company entered into a note purchase agreement for the issuance of $300 million of 2033 Notes with a group of institutional investors, consisting of $60 million of 3.46% Series A Notes and $240 million of 3.51% Series B Notes, each due January 19, 2033.
−Removed: The Series A Notes were issued on October 20, 2022, and the Series B Notes are scheduled to be issued on January 19, 2023.
+Added: On February 3, 2022, the Company entered into a note purchase agreement for the issuance of $300 million of unsecured senior notes with a group of institutional investors, consisting of $60 million of 3.46% series A notes (“Series A Notes”) and $240 million of 3.51% series B notes (“Series B Notes”), each due January 19, 2033 (collectively, the “2033 Notes”).
+Added: The Series A Notes were issued on October 20, 2022, and the Series B Notes were issued on January 19, 2023.
No principal payments will be required until maturity.
−Removed: Beginning in 2023, interest payments of $5.3 million will be due semi-annually on January 19 and July 19 of each year, with the exception of the first payment on January 19, 2023, which will be
−Removed: $0.5 million.
−Removed: The 2023 Notes are excluded from short term liabilities because the Company intends to use a combination of the proceeds from the issuance of the 2033 Notes and availability under the 2027 Revolving Credit Facility to repay the 2023 Notes upon maturity.
−Removed: As of September 30, 2022, the Company was in compliance with all covenants under its debt instruments.
−Removed: For additional information about the Company’s debt instruments, see Note 5, Long-Term Debt, in the financial statements as well as Note 5, Long-Term Debt, in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.
+Added: Beginning in 2023, interest payments of $5.3 million will be due semi-annually on January 19 and July 19 of each year, with the exception of the first payment on January 19, 2023, which was $0.5 million.
+Added: The 2033 Notes are unsecured and rank equally in right of payment with the Company's other unsecured senior indebtedness.
+Added: The 2033 Notes contain certain covenants on the part of the Company, including an interest coverage covenant, a debt-to-capitalization covenant, and covenants relating to liens, asset sales and mergers, among others.
+Added: The 2033 Notes also specify certain events of default, upon the occurrence of which the maturity of the notes may be accelerated, including failure to pay principal and interest, violation of covenants or default on other indebtedness, among others.
+Added: The 3.29% unsecured senior notes due February 27, 2023 (the “2023 Notes”) were repaid using a combination of the proceeds from the issuance of the 2033 Notes and availability under the 2027 Revolving Credit Facility.
+Added: The Company has a $10 million line of credit (“Credit Line”) with Bank of America, N.A.
+Added: (“Bank of America”) for short-term liquidity needs and letters of credit, with a maturity date of June 30, 2024.
+Added: Outstanding letters of credit under the $10 million credit line were $0.6 million and available borrowing capacity was $9.4 million as of March 31, 2023.
+Added: As of March 31, 2023, the Company was in compliance with all covenants under its debt instruments.
+Added: For additional information about the Company’s debt instruments, see Note 5, Long-Term Debt, of the Notes to Condensed Financial Statements (Unaudited) as well as Note 5, Long-Term Debt, in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.
Cash Flow and Capital Expenditures
−Removed: The Company generated positive operating cash flows during the 2022 first nine months with net cash provided by operating activities of $161.2 million compared with $280.4 million for the 2021 first nine months, a 43% decrease.
−Removed: The decrease was primarily due to a tax refund of $119.5 million, including accrued interest, for the Company’s 2019 federal tax return which was received in the 2021 first quarter.
−Removed: In addition, increased revenues and operating income in KMT and KDS during the 2022 first nine months were offset by increased inventory levels due to higher activity and managing supply chain challenges seen especially in KDS during the 2022 first nine months.
−Removed: Increases in KMT revenues and operating income were driven by increased barge utilization and higher term and spot contract pricing in the inland and coastal markets during the 2022 first nine months.
−Removed: The 2021 first nine months KMT revenues and operating income were also negatively impacted by the impacts of Winter Storm Uri in February 2021 and Hurricane Ida in the 2021 third quarter.
−Removed: During the 2022 and 2021 third quarters and first nine months, the Company generated cash of $32.9 million and $39.2 million, respectively, from proceeds from the disposition of assets, and $3.9 million and $0.6 million, respectively, from proceeds from the exercise of stock options.
−Removed: For the 2022 first nine months, cash generated was used for capital expenditures of $120.3 million, including $6.8 million for inland towboat construction and $113.5 million primarily for upgrading existing marine equipment and KMT and KDS facilities.
+Added: The Company generated positive operating cash flows during the 2023 first quarter with net cash provided by operating activities of $16.5 million compared with $32.2 million for the 2022 first quarter, a 49% decrease.
+Added: Higher revenues and operating income in KMT and KDS during the 2023 first quarter were more than offset by an increase in trade accounts receivable, primarily due to higher revenues and timing of collections, and increased inventory levels in KDS due to higher activity and managing supply chain challenges during the 2023 first quarter.
+Added: Increases in KMT revenues and operating income were driven by higher term and spot contract pricing and increased barge utilization in the inland and coastal markets during the 2023 first quarter.
+Added: During the 2023 and 2022 first quarters, the Company generated cash of $8.0 million and $14.3 million, respectively, from proceeds from the disposition of assets, and $0.1 million and $2.3 million, respectively, from proceeds from the exercise of stock options.
+Added: For the 2023 first quarter, cash generated was used for capital expenditures of $73.2 million, including $4.4 million for inland specialized equipment construction and $68.8 million primarily for upgrading existing marine equipment and KMT and KDS facilities.
Treasury Stock Purchases
−Removed: During the 2022 first nine months, the Company purchased 0.4 million shares of its common stock for $22.9 million, at an average price of $59.32 per share.
−Removed: As of November 3, 2022, the Company had approximately 1.0 million shares available under its existing repurchase authorization.
+Added: During the 2023 first quarter, the Company purchased 46,850 shares of its common stock for $3.2 million, at an average price of $67.97 per share.
+Added: As of May 5, 2023, the Company had approximately 6.0 million shares available under its existing repurchase authorization.
Historically, treasury stock purchases have been financed through operating cash flows and borrowings under the Company’s then current revolving credit facility.
3 unchanged sentences
Funds generated from operations are available for acquisitions, capital expenditure projects, common stock repurchases, repayments of borrowings, and for other corporate and operating requirements.
−Removed: In addition to net cash flows provided by operating activities, as of November 3, 2022 the Company also had cash equivalents of $114 million, availability of $494.9 million under its 2027 Revolving Credit Facility, and $8.6 million available under its credit line.
+Added: In addition to net cash flows provided by operating activities, as of May 5, 2023 the Company also had cash equivalents of $45.8 million, availability of $442.9 million under its 2027 Revolving Credit Facility, and $6.9 million available under its credit line.
Neither the Company, nor any of its subsidiaries, is obligated on any debt instrument, swap agreement, or any other financial instrument or commercial contract which has a rating trigger, except for the pricing grid on its 2027 Credit Agreement.
1 unchanged sentence
The 2027 Revolving Credit Facility's commitment is in the amount of $500 million and matures July 29, 2027.
−Removed: The 2023 Notes do not mature until February 27, 2023 and require no prepayments.
−Removed: The Company intends to use a combination of the proceeds from the issuance of the 2033 Notes and availability under the 2027 Revolving Credit Facility to repay the 2023 Notes upon maturity.
The 4.2% senior unsecured notes do not mature until March 1, 2028 and require no prepayments.
−Removed: The 2027 Term Loan in the amount of $250 million is subject to quarterly installments, beginning September 30, 2023, in increasing percentages of the original principal amount of the loan, with the remaining unpaid balance of approximately $43.8 million payable on July 29, 2027, assuming no prepayments.
+Added: The 2033 Notes do not mature until January 19, 2033
+Added: and require no prepayments.
+Added: The 2027 Term Loan in the amount of $250 million is subject to quarterly installments, beginning June 30, 2025, in increasing percentages of the original principal amount of the loan, with the remaining unpaid balance of approximately $43.8 million payable on July 29, 2027, assuming no prepayments.
The 2027 Term Loan is prepayable, in whole or in part, without penalty.
There are numerous factors that may negatively impact the Company’s cash flows in 2023.
−Removed: For a list of significant risks and uncertainties that could impact cash flows, see Note 14, Contingencies and Commitments, in the financial statements, and Item 1A —
+Added: For a list of significant risks and uncertainties that could impact cash flows, see Note 14, Contingencies and Commitments, of the Notes to Condensed Financial Statements (Unaudited), and Item 1A —
Risk Factors and Note 14, Contingencies and Commitments, in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.
−Removed: Amounts available under the Company’s existing financial arrangements are subject to the Company continuing to
−Removed: meet the covenants of the credit facilities as described in Note 5, Long-Term Debt, in the financial statements as well as Note 5, Long-Term Debt, in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021.
+Added: Amounts available under the Company’s existing financial arrangements are subject to the Company continuing to meet the covenants of the credit facilities as described in Note 5, Long-Term Debt, of the Notes to Condensed Financial Statements (Unaudited) as well as Note 5, Long-Term Debt, in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.
The Company has issued guaranties or obtained standby letters of credit and performance bonds supporting performance by the Company and its subsidiaries of contractual or contingent legal obligations of the Company and its subsidiaries incurred in the ordinary course of business.
−Removed: The aggregate notional value of these instruments is $20.1 million at September 30, 2022, including $12.1 million in letters of credit and $8.0 million in performance bonds.
+Added: The aggregate notional value of these instruments is $18.1 million at March 31, 2023, including $11.3 million in letters of credit and $6.8 million in performance bonds.
All of these instruments have an expiration date within two years.
4 unchanged sentences
However, the short-term effectiveness of the fuel escalation clauses can be affected by a number of factors including, but not limited to, specific terms of the fuel escalation formulas, fuel price volatility, navigating conditions, tow sizes, trip routing, and the location of loading and discharge ports that may result in the Company over or under recovering its fuel costs.
−Removed: Spot contract rates generally reflect current fuel prices at the time the contract is signed but do not have escalators for fuel.
−Removed: While inflationary pressures have increased in the second half of 2021 and into 2022, the Company has certain mechanisms designed to help mitigate the impacts of rising costs.
+Added: The Company’s spot contract rates generally reflect current fuel prices at the time the contract is signed but do not have escalators for fuel.
+Added: While inflationary pressures have increased, the Company has certain mechanisms designed to help mitigate the impacts of rising costs.
For example, KMT has long-term contracts which generally contain cost escalation clauses whereby certain costs, including fuel as noted above, can be largely passed through to its customers.
3 unchanged sentences
Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.