Kirby(KEX)2025-02-18 18:45Fleet Operations - Kirby Corporation operates the largest domestic tank barge fleet in the U.S., with 1,094 inland tank barges and a total capacity of 24.2 million barrels[21]. - The average age of the inland tank barge fleet is approximately 18 years, with 600 barges being 30 years or older, indicating potential for future retirements[28]. - The company estimates that 27 new tank barges were placed in service and 48 were retired industry-wide in 2023, with projections of 34 new and 38 retired in 2024[27]. - The Company operates 28 out of approximately 260 coastal tank barges, representing about 11% of the market[31]. - The inland tank barge fleet has grown from 71 barges in 1988 to 1,094 barges as of December 31, 2024, accounting for approximately 27% of the estimated total domestic inland tank barges[33]. - The Company operates a fleet of 1,094 inland tank barges and an average of 281 inland towboats during the 2024 fourth quarter[48]. - Kirby Offshore Marine's coastal fleet consists of 28 tank barges with a total capacity of 2.9 million barrels, primarily transporting refined petroleum products, black oil, and petrochemicals[68]. - The Company completed the installation of an approved ballast water management system on the last barge in its fleet during 2024[128]. Revenue and Market Share - The inland tank barge industry has remained stable since 2019, with Kirby Corporation holding approximately 27% of the market share[26]. - Petrochemical products accounted for 51% of the segment's 2024 revenues, while black oil represented 25%, refined petroleum products 21%, and agricultural chemicals 3%[37][38][39][40]. - Approximately 65% of inland marine transportation revenues were under term contracts in 2024, up from 60% in 2022 and 2023[58]. - The distribution and services segment generated total revenues of $1,352.8 million in 2024, with service and parts accounting for 80% and manufacturing for 20%[86]. - The commercial and industrial operations represented approximately 46% of the distribution and services segment's revenues in 2024[86]. - No single customer accounted for 10% or more of the company's revenues in 2024, 2023, or 2022, indicating a diversified customer base[77][85]. - Five KMT customers accounted for approximately 18% of the Company's 2024 revenue, while three KDS customers accounted for about 10% of the same year's revenue[201]. Operational Efficiency and Services - The company provides after-market services and genuine replacement parts for various industrial applications, enhancing its distribution and services segment[18]. - The company has a proprietary vessel management system that enhances operational efficiency and customer service through real-time tracking and communication[61]. - The Company has a network of 61 branch locations across 16 states and Colombia, enhancing its service capabilities[79]. - The Company maintains insurance coverage for various operational hazards, including hull, liability, and pollution liability insurance[135]. - The Company has implemented safety training programs to enhance employee safety behavior and performance[137]. - The Company operates regional training centers for KDS, providing skill-based training for technicians[146]. Employee and Safety Management - The Company has approximately 5,414 employees, with the majority working full-time in the United States[140]. - In 2024, the Company issued approximately 1,663 certificates for course completions at its training facility, including 883 USCG approved classes[145]. - The Company has a succession planning process that is reviewed regularly by senior management and the Board[150]. - 90% of employees surveyed agree that the Company is committed to employee safety, reflecting a strong safety culture[151]. - KMT has approximately 3,119 employees, with around 2,380 being vessel crew members, facing competitive labor pressures due to ongoing retirements and a mariner shortage[171]. - The company has invested in training programs to develop crew members from entry-level positions to leadership roles, addressing the challenge of crew shortages[170]. Environmental and Regulatory Compliance - The Company is committed to environmental responsibility, participating in programs aimed at reducing greenhouse gas emissions[136]. - The company maintains compliance with various governmental regulations, including the Clean Water Act and the Clean Air Act[121][130]. - The Company anticipates that new hazardous substance spill contingency regulations will not be more difficult to comply with than existing oil spill plans[132]. - The company believes no material capital expenditures beyond those currently contemplated will be required due to proposed regulations[130]. - The Company faces potential additional costs and risks related to ESG matters, with evolving regulatory requirements impacting compliance expenses[209]. Market Risks and Challenges - The aging infrastructure of the United States inland waterway system, with over 50% of locks being over 50 years old, poses risks of increased costs and operational disruptions[166]. - The cost of fuel accounted for approximately 9% of marine transportation revenue in 2024, with fuel price volatility potentially impacting profitability[180]. - The Company faces risks from potential marine accidents or spill events, which could disrupt operations and impact financial performance[167]. - Legislative and regulatory changes regarding hydraulic fracturing could materially impact demand for the Company's pressure pumping equipment[186]. - The Company is subject to risks associated with climate change legislation, which could increase operational costs and impact demand for its services[198]. - The Company faces competition from independent distribution and service companies in the oil and gas market, which could negatively affect its operations[188]. Financial Stability and Credit Risks - Deterioration of the Company's credit profile or disruptions in credit markets could restrict access to debt capital markets and increase borrowing costs[208]. - The Company relies on critical operating assets, including information systems, for its business operations, which are vulnerable to natural disasters, cybersecurity attacks, and other extraordinary events[204]. - Any damage to critical assets or data security could lead to increased operating expenses or legal actions, adversely affecting the Company's operations[206].