Kirby Corp. (NYSE: KEX) reported Q1 EPS of $0.74, $0.05 better than the analyst estimate of $0.69. Revenue for the quarter came in at $744.62 million versus the consensus estimate of $735.34 million.

• 2019 first quarter earnings per share of $0.74
• 2019 first quarter earnings negatively impacted by inland marine results with poor weather conditions and waterway closures resulting in record delay days
• Inland barge market very active with high utilization rates
• 2019 full year earnings per share guidance unchanged at $3.25 to $3.75

David Grzebinski, Kirby’s President and Chief Executive Officer, commented, “Kirby’s first quarter results were challenged by temporary weakness in marine transportation which resulted from record delay days. Our distribution and services segment performed well, helping to offset the results from our marine businesses.

“In inland marine transportation, our quarter’s results were heavily impacted by unusually poor operating conditions throughout the U.S. waterway network which negatively impacted our earnings by approximately $0.05 per share. Although we anticipated weather-related delays in the first quarter, this year we experienced significantly more than expected with persistent fog along the Gulf Coast, extended periods of ice on the Illinois River, and near record high water conditions on the Mississippi River. Additionally, there were significant navigational delays resulting from lock maintenance and the closure of the Houston Ship Channel in March due to a fire at a chemical storage facility. These conditions resulted in an approximate 80% increase in delay days from the more normal year ago quarter. However, customer demand remained strong throughout the quarter, and barge utilization strengthened into the mid-90% range on average. I would like to thank our mariners and shore staff who performed extremely well despite these very difficult operating conditions, remaining focused on safety and serving the needs of our customers.

“In mid-March, we closed the acquisition of Cenac Marine Services, LLC’s (“Cenac”) marine transportation fleet. Cenac brings to Kirby a young fleet of well-maintained 30,000 barrel tank barges and new modern towboats, as well as highly-trained and first class mariners. With tight market conditions across the inland industry, the Cenac acquisition is well-timed and will improve our ability to service our customers and enhance our long-term earnings potential.

“In coastal marine transportation, market conditions improved modestly. During the quarter, barge utilization rates increased into the low 80% range, and we renewed term contracts higher in the mid-single digits. However, operating margins remained slightly negative in the first quarter as a result of some extended shipyard periods for several of our larger vessels.

“Distribution and services performed well during the first quarter with sequential double-digit improvement in revenue and operating income. Compared to the fourth quarter, our manufacturing teams completed an increased number of new pressure pumping units and equipment for domestic customers, as well as deliveries of oilfield equipment to international customers. However, this was partially offset by lower sequential sales of new engines, transmissions and parts to oilfield customers. In commercial and industrial, results were favorably impacted by continued improvement in the marine and power generation sectors,” Mr. Grzebinski concluded.

GUIDANCE:

Kirby Corp. sees FY2019 EPS of $3.25-$3.75, versus the consensus of $3.53.

Commenting on the 2019 full year outlook and guidance, Mr. Grzebinski said, “Our earnings guidance range for the year remains $3.25 to $3.75 per share. Although the first quarter was adversely impacted by unusually high delay days in our inland marine business, we anticipate improved results in marine as we progress through the remainder of 2019. In distribution and services, the first quarter results were strong; however, the outlook for the second half of 2019 remains uncertain.”

For earnings history and earnings-related data on Kirby Corp. (KEX) click here.