The following is the text of a news release from Kirby Corp.:
(HOUSTON) (March 17) — Kirby Corporation announced today the signing of agreements to construct 29 additional 30,000-barrel inland tank barges with a total capacity of 830,000 barrels for delivery throughout 2014. Of the 29 inland tank barges, 18 are through the assumption of shipyard construction contracts from another inland tank barge operator and 11 are new orders placed by Kirby.
Based on current commitments, steel prices and projected delivery schedules, the cost of the 29 inland tank barges is approximately $81 million. The construction of the 29 inland tank barges are in addition to the previously announced construction during 2014 of 37 inland tank barges with a total capacity of 390,000 barrels at a cost of approximately $45 million, as well as approximately $45 million in progress payments on the construction of the 185,000-barrel coastal articulated tank barge and tugboat unit announced in January 2014 for delivery in mid- to late 2015.
Joe Pyne, Kirby's chairman and chief executive officer, commented, "The 29 additional 30,000-barrel inland tank barges which are expected to be delivered this year will help to meet the additional volume requirements driven by strong and expanding movements of crude oil and natural gas condensate, as well as new demand from expansions in the petrochemical and refining industries."
Commenting on the 2014 first quarter guidance of $1.05 to $1.15 per share issued in late January, Pyne said, "Our first quarter guidance included some negative impact on our marine operations from the unfavorable winter weather we experienced during the month of January. Since early January, temperatures have primarily remained below freezing causing heavy ice on the Illinois, upper Mississippi and upper Ohio rivers. We have continued to operate on these rivers despite the heavy ice conditions, but with additional horsepower or reduced tow sizes. We are not yet able to quantify the effect of the weather conditions on first quarter earnings, and we have also incurred a $.03 per share severance charge in the quarter, but we still expect earnings will be within the published guidance."
Kirby Corp., based in Houston, Texas, is the nation's largest domestic tank barge operator, transporting bulk liquid products throughout the Mississippi River System, the Gulf Intracoastal Waterway, coastwise along all three United States coasts and in Alaska and Hawaii. Kirby transports petrochemicals, black oil, refined petroleum products and agricultural chemicals by tank barge. Through the diesel engine services segment, Kirby provides after-market service for medium-speed and high-speed diesel engines and reduction gears used in marine and power generation applications. Kirby also distributes and services high-speed diesel engines, transmissions, pumps, compression products and manufactures and remanufactures oilfield service equipment, including pressure pumping units, for land-based pressure pumping and oilfield service markets.
