Kirby sees FY25 year-over-year growth in earnings 15%-25%

CEO Grzebinski said, “As we move into the second half of the year, we remain focused on execution, while closely monitoring the evolving macroeconomic and geopolitical environment and their potential impact to our volumes. We still expect 15 to 25% year-over-year growth in earnings for all of 2025. However, recent shifts in trade policy have introduced new complexities to near-term planning for us and our customers and have contributed to some softness in areas. These complexities are impacting trade flows and demand including chemicals as well as sourcing for our power generation supply chain. If the current softness persists, we will likely be closer to the lower end of our prior full year EPS growth guidance, with movement closer to the higher end dependent on stronger economic conditions. While the environment has become less certain, we remain confident in our ability to adapt and execute. We are committed to maintaining capital discipline, and we are well-positioned to navigate the challenges ahead. Our balance sheet remains strong, and we are generating solid free cash flow, positioning us well to invest in disciplined capital allocation and long-term value creation opportunities.” In inland marine, market conditions remain constructive, though we are seeing some signs of price moderation. Barge utilization, while still healthy, has softened slightly to begin the third quarter and is now expected to be in the low 90% range for the third quarter. We expect the pricing improvements in term contracts to continue longer term given the limited pace of newbuilds, but spot market pricing might be under pressure due to short term demand softness. Inflation remains a factor, particularly in labor, and the industry-wide mariner shortage continues to constrain capacity growth. While the environment is more challenged than earlier in the year, operating margins are expected to remain in the 20% range, assuming no major disruptions from tariffs or broader economic conditions. In coastal marine, market fundamentals remain strong. Contract renewals remain robust, and we are seeing improved operating leverage as shipyard activity winds down. We expect coastal barge utilization to remain in the mid-90% range. Limited vessel availability across the industry and strong customer demand are driving continued pricing momentum. While inflationary pressures and labor constraints persist, the coastal business is expected to have operating margins in the mid to high teens range with modest improvement in the back half of the year. In distribution and services, the outlook is mixed. Power generation continues to be an area of strength, with strong demand from data centers and industrial customers driving order growth. However, extended OEM lead times and delivery schedules remain a challenge. In commercial and industrial, marine repair activity is steady, and the on-highway market has shown modest improvement. Oil and gas growth remains constrained due to current market conditions and customer capital discipline, but we continue to show strength in e-frac and disciplined cost management. For the segment, we now expect full-year revenues to be flat to slightly up, with operating margins in the high-single digits. Kirby (KEX) expects to generate net cash provided from operating activities of $620 million to $720 million in 2025 and capital spending is expected to range between $260 million to $290 million. Approximately $180 million to $210 million is associated with marine maintenance capital and improvements to existing inland and coastal marine equipment, and facility improvements. Up to approximately $80 million is associated with growth capital spending in both our businesses.