Kirby Corporation · NYSE:KEX
Kirby — Investor Presentation (February 2006)
45 slides from Kirby's investor presentation, Feb 15, 2006
Slide 1: Kirby Corporation Putting America's Waterways to Work
Kirby Corporation Putting America’s Waterways to Work NYSE: KEX February
Slide 2: Forward Looking Statement and Non-GAAP Financial Measures
Statements contained in this presentation with respect to the future are forward-looking statements. These statements reflect management’s reasonable judgement with respect to future events. Forward-looking statements involve risks and uncertainties. Actual results could differ materially from those
Slide 3: Kirby... Business Operations
Kirby... Business Operations
Slide 4: Kirby Public Market Facts
NYSE: K E X $54.67 26.2M $1,435M $200M $1,635M 2,400 Current Price (February 13, 2006) Number of Shares O/S Market Capitalization Debt (December 31, 2005) Enterprise Value Employees Kirby…Public Market Facts
Slide 5: Kirby Facts
– Lowest cost due to economies of scale – Best positioned for growth opportunities – “One Stop Shop” for customers Kirby Facts • Largest inland tank barge operator • Operates 897 barges and 242 towing vessels • Sustainable competitive advantages: • 70% of Kirby’s business is under contract, 30% spot
Slide 6: Acquisitions in Core Business
Towboats Only Date No. of Tank Barges Description Alliance Marine Alamo Inland Marine Co. Brent Towing Company International Barge Lines, Inc. Sabine Towing & Transportation Co. Ole Man River Towing, Inc. Scott Chotin, Inc. South Texas Towing TPT, Division of Ashland Guidry Enterprises Chotin Transp
Slide 7: Revenue... Business Operations
17% growth rate from 1988-2005 Revenue... Business Operations
Slide 8: Earnings Per Share
1994-2001 adjusted to exclude goodwill amortization expense 2002 adjusted to exclude impairment charges of $12.5 million, net of taxes, or $.51 per share See Appendix for reconciliation of GAAP to Non-GAAP earnings per share Earnings Per Share From Continuing Operations Before Adjustments 14.4% grow
Slide 9: Inland Waterway System
St. Paul Sioux City Chicago Pittsburgh Charleston St. Marks Tulsa Corpus Christi New Orleans St. Louis Cincinnati Mobile Brownsville Houston 12,000 miles of navigable waterways linking America’s heartland to the world Kirby is one of the few operators offering distribution throughout the Mississippi
Slide 10: Industry Facts
Industry Facts • Approximately 18,300 dry cargo barges, 2,800 liquid tank barges. Kirby in the liquid cargo business only. • No competition from foreign companies due to a U.S. law known as the Jones Act • Always a market to move product by barge on inland waterways • Equipment not subject to econom
Slide 11: Number of Inland Tank Barges
For the years 1993 through 2004 Number of Inland Tank Barges
Slide 12: Age of Tank Barges
615 Number of Tank Barges 15 OteS Sto 1015 15to20. M25 2m30 30t035 >35 ‘Age of Tank Barges (Years)
Slide 13: Barges Compete Successfully With Rails and Trucks
Kirby’s fleet capacity of 16.7 million bbls. equates to trucks, or rail cars 90,000 bbl. three-barge tow is equivalent to: 83,500 22,200 Barges Compete Successfully With Rails and Trucks
Slide 14: Barges... Efficient
One gallon of fuel in a barge can move one ton of freight 522 miles, compared to 403 miles by rail and only 80 miles for a truck. Barge Rail Truck Barges… Efficient
Slide 15: Barges... Environmentally Friendly
While moving one ton of freight 1,000 miles: • Smog is a major problem in most major cities • Oxides of nitrogen are the chemicals that produce smog Trains produce 3.5 times as much oxides of nitrogen as barges Trucks produce 19 times as much oxides of nitrogen as barges Barges… Environmentally Frie
Slide 16: Kirby Inland Marine
KIRBY INLAND MARINE
Slide 17: Largest Inland Tank Barge Operator
Largest Inland Tank Barge Operator
Slide 18: High Tech and Diverse Fleet
High Tech and Diverse Fleet Active Tank Barges
Slide 19: Fleet Size and Diversity... Better Asset Utilization
– More backhaul opportunities – Faster barge turnarounds – More efficient use of horsepower – Barges positioned closer to cargos – Enhanced purchasing power – Minimal incremental G&A from fleet additions – Less cleaning due to more barges with compatible prior cargos Fleet Size and Diversity… Better
Slide 20: Tank Barge Owners By Number of Tank Barges
Informa Economics, Barge Fleet Profile, March 2005 Tank Barge Owners By Number of Tank Barges Shipper Owned Independent Tank Barges Operated Dry Cargo Barges Operated Kirby Corporation - American Commercial Lines LLC 2,861 Marathon Ashland Petroleum - Ingram Barge Company 3,468 Canal Barge Company,
Slide 21: End Uses of Products... Demand Drivers
Revenue Distribution Products Moved Products Drivers 67% Petrochemicals and Chemicals Benzene, Styrene, Methanol, Acrylonitrile, Xylene, Caustic Soda, Butadiene, Propylene Housing, Consumer Goods, Autos, Clothing 20% Black Oil Products Residual Fuel, No. 6 Fuel Oil, Coker Feed, Vacuum Gas, Asphalt R
Slide 22: Safety Is Our Franchise To Operate
– Extensive company-owned and operated training facility – Seamen’s Church Institute (Towboat Simulator) – First winner of Benkert Award, highest award given by Department of Transportation for safety and environmental protection • Committed to dedicating adequate resources to achieve safety objecti
Slide 23: |B cePestics | GE Plastics
|B cePestics | GE Plastics all ALERO ENERGY 7% CORPORATION
Slide 24: Kirby Engine Systems
Kirby Engine Systems
Slide 25: Diesel Engine Services Markets
– Inland River Carriers – Dry and Liquid – Offshore Towing – Dry and Liquid – Offshore Oilfield Services – Drilling Rigs & Supply Boats – Harbor Towing – Dredging – Great Lakes Ore Carriers – Standby Power Generation – Pumping Stations – Industrial Reduction Gears – Passenger (Transit Systems) – Cla
Slide 26: Reduction Gear Repair
REDUCTION GEAR REPAIR REPLACEMENT PARTS. ENGINE REPAIR
Slide 27: Acquisitions and Internal Growth
Acquisitions and Internal Growth
Slide 28: Key Customers
Key Customers
Slide 29: Market Conditions
Market Conditions
Slide 30: Market Conditions Year in Review
• Record revenues, net earnings, earnings per share and EBITDA • Petrochemical and black oil products markets remained strong • Winter weather conditions in January and February. Favorable conditions in March, second quarter and fourth quarter • Hurricanes Katrina and Rita negatively impacted the th
Slide 31: First Quarter and Year Outlook
• 2006 first quarter earnings per share guidance of $.64 to $.70, compared with $.52 for 2005 first quarter • Guidance based on: • Petrochemical and black oil volumes will remain strong • Expect increased delay days from winter weather conditions • 2006 year earnings per share guidance of $2.95 to $
Slide 32: Future Growth Opportunities
– Kirby operates more efficiently due to size and distribution system – Competitors face fleet replacement decisions – Outsourcing by shippers provides growth opportunities – Customers seek to single source their requirements – Purchased two-thirds interest in Osprey Line, a provider of container on
Slide 33: Osprey Line, LLC
Osprey Line, LLC • Purchased one-third interest in April 2004 • Increased ownership to two-thirds in January • Transports containers on barge on U.S. inland waterway system and Gulf of Mexico • Future growth opportunity as U.S. contends with congestion problems • Provides attractive alternative to r
Slide 34: Financial Highlights
Financial Highlights
Slide 35: For Year Ended December 31, 2005
For Year Ended December 31, 2005
Slide 36: 11.7%! 10.0% 10.1% 10.1% 05% 9.7% B% ‘2000 2001 2002 2005
11.7%! 10.0% 10.1% 10.1% 05% 9.7% B% ‘2000 2001 2002 203 204 2005
Slide 37: EBITDA Per Share Growth
See Appendix for reconciliation of GAAP net earnings to Non-GAAP EBITDA 11.9% growth rate from 1994 - 2005 EBITDA Per Share Growth
Slide 38: Cash Flows
Excluding acquisitions * Unaudited Cash Flows
Slide 39: Debt / Capitalization
27.1% 57.3% Debt / Capitalization
Slide 40: Balance Sheet
[Assets Current Assets Property & Equipment Goodwill Other Assets Sa Total Assets Liabilities & Equity Current Liabilities Total Debt Other Liabilities Stockholders’ Equity {Total Liabilities & Equity Debt to Capitalization
Slide 41: Financial Strength
– Standard & Poor’s – BBB+ – Moody’s – Baa3 – $200 million outstanding – Floating rate of LIBOR +0.5% – No required principal payments until maturity – Accordion feature added to allow maximum amount to increase to $225 million without amendment – $150 million of interest rate swaps • Investment gra
Slide 42: Why Invest In Kirby?
Why Invest In Kirby?
Slide 43: Why Invest in Kirby?
• Consistent long-term record of success in core businesses • Excellent business fundamentals • Strong free cash flow • Internal and external growth opportunities in core businesses • Strong operating leverage with every 1% increase in marine transportation segment margin adds $.16 per share to earn
Slide 44: Thank You For Listening to Our Story
Thank You For Listening to Our Story Kirby Corporation Putting America’s Waterways to Work
Slide 45: Appendix: Reconciliation of GAAP to Non-GAAP Financial Measures
Appendix KIRBY CORPORATION Reconciliation of GAAP to Non-GAAP Financial Measures Kirby reports its financial results in accordance with generally accepted accounting principles (GAAP). However, Kirby believes that certain non-GAAP financial measures are useful in managing Kirby’s businesses and eval