<PAGE> 1
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 10-Q
[X] Quarterly report pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934
For the quarter ended March 31, 1995
[ ] Transition report pursuant to Section 13 or 15(d) of the
Securities and Exchange Act of 1934
Commission File
Number 1-7615
Kirby Corporation
_____________________________________________________________________________
(Exact name of registrant as specified in its charter)
Nevada 74-1884980
_______________________________ _________________________________
(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
1775 St. James Place, Suite 300, Houston, TX 77056-3453
_____________________________________________________________________________
(Address of principal executive offices) (Zip Code)
(713) 629-9370
_____________________________________________________________________________
(Registrant's telephone number, including area code)
No Change
_____________________________________________________________________________
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that
the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes [X] No [ ]
The number of shares outstanding of the registrant's Common Stock, $.10 par
value per share, on May 9, 1995 was 28,145,686.
<PAGE> 2
PART 1 - FINANCIAL INFORMATION
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
CONDENSED BALANCE SHEETS
(Unaudited)
ASSETS
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
--------- ------------
($ in thousands)
<S> <C> <C>
Marine Transportation, Diesel Repair and Other
Current assets:
Cash and invested cash $ 3,544 7,355
Available-for-sale securities - short-term
investments 12,536 2,875
Accounts and notes receivable, net of allowance
for doubtful accounts 57,730 63,300
Inventory - finished goods, at lower of average
cost or market 8,582 8,270
Prepaid expenses 12,779 13,661
Deferred taxes 1,425 1,324
-------- -------
Total current assets 96,596 96,785
-------- -------
Property and equipment, at cost 465,176 481,612
Less allowance for depreciation 145,659 153,672
-------- -------
319,517 327,940
-------- -------
Excess cost of consolidated subsidiaries 8,926 9,280
Noncompete agreements 3,501 3,889
Equity in unconsolidated subsidiaries 8,561 181
Sundry 11,294 12,731
-------- -------
Total assets - Marine Transportation,
Diesel Repair and Other 448,395 450,806
-------- -------
</TABLE>
Table continued on following
<PAGE> 3
PART 1 - FINANCIAL INFORMATION
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
CONDENSED BALANCE SHEETS, Continued
(Unaudited)
ASSETS
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
-------- -----------
($ in thousands)
<S> <C> <C>
Insurance
Investments:
Available-for-sale securities:
Fixed maturities 164,009 149,173
Short-term investments 20,923 21,227
-------- -------
184,932 170,400
Cash and invested cash 1,693 4,485
Accrued investment income 3,421 2,638
Accounts and notes receivable, net of allowance
for doubtful accounts 15,969 9,613
Reinsurance receivable on paid losses 13,588 9,871
Prepaid reinsurance premiums 3,129 5,147
Deferred policy acquisition costs 13,328 11,690
Property and equipment, at cost, net of
allowance for depreciation 4,952 2,822
-------- -------
Total assets - Insurance 241,012 216,666
-------- -------
$689,407 667,472
======== =======
</TABLE>
See accompanying notes to condensed financial statements.
<PAGE> 4
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
CONDENSED BALANCE SHEETS
(Unaudited)
LIABILITIES AND STOCKHOLDERS' EQUITY
<TABLE>
<CAPTION>
March 31, December 31,
1995 1994
--------- ----------
($ in thousands)
<S> <C> <C>
Marine Transportation, Diesel Repair and Other
Current liabilities:
Current portion of long-term debt $ 5,333 10,962
Accounts payable 13,282 15,771
Accrued liabilities 41,175 32,559
Deferred revenues 6,076 8,294
-------- -------
Total current liabilities 65,866 67,586
-------- -------
Long-term debt, less current portion 142,999 148,535
Deferred taxes 44,091 42,587
Other long-term liabilities 8,101 7,998
-------- -------
Total liabilities - Marine Transportation,
Diesel Repair and Other 261,057 266,706
-------- -------
Insurance
Losses, claims and settlement expenses 60,879 56,433
Unearned premiums 99,415 89,801
Reinsurance premiums payable 1,949 2,657
Other liabilities 15,756 11,473
Minority interest in consolidated insurance subsidiary 20,064 17,426
-------- -------
Total liabilities - Insurance 198,063 177,790
-------- -------
Contingencies and commitments
Stockholders' equity:
Preferred stock, $1.00 par value per share. Authorized
20,000,000 shares -- --
Common stock, $.10 par value per share. Authorized
60,000,000 shares, issued 30,782,000 shares
(30,782,000 at December 31, 1994) 3,078 3,078
Additional paid-in capital 157,026 157,021
Unrealized net losses in value of investments (207) (2,686)
Retained earnings 83,460 78,651
-------- -------
243,357 236,064
Less cost of 2,464,000 shares in treasury (2,468,000
at December 31, 1994) 13,070 13,088
-------- -------
230,287 222,976
-------- -------
$689,407 667,472
======== =======
</TABLE>
See accompanying notes to condensed financial statements.
<PAGE> 5
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
CONDENSED STATEMENTS OF EARNINGS
(Unaudited)
<TABLE>
<CAPTION>
Three months ended March 31,
----------------------------
1995 1994
------------ ------------
($ in thousands, except
per share amounts)
<S> <C> <C>
Revenues:
Transportation $ 79,209 73,387
Diesel repair 14,025 10,171
Net premiums earned 21,067 14,110
Commissions earned on reinsurance 912 1,307
Investment income 3,159 1,936
Gain on disposition of assets 13 161
Realized gain on investments 233 758
-------- -------
118,618 101,830
-------- -------
Costs and expenses:
Costs of sales and operating expenses (except
as shown below) 63,595 56,424
Losses, claims and settlement expenses 14,569 11,125
Policy acquisition costs 4,752 3,635
Selling, general and administrative 11,829 11,925
Taxes, other than on income 2,590 3,590
Depreciation and amortization 9,730 7,794
Minority interest expense 1,173 646
-------- -------
108,238 95,139
-------- -------
Operating income 10,380 6,691
Equity in earnings of marine partnerships 159 --
Interest expense (2,910) (1,809)
-------- -------
Earnings before taxes on income 7,629 4,882
Provision for taxes on income 2,820 1,985
-------- -------
Net earnings $ 4,809 2,897
======== =======
Earnings per share of common stock $ .17 .10
======== =======
</TABLE>
See accompanying notes to condensed financial statements.
<PAGE> 6
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
CONDENSED STATEMENTS OF CASH FLOW
(Unaudited)
<TABLE>
<CAPTION>
Three months ended March 31,
----------------------------
1995 1994
------------ -----------
($ in thousands)
<S> <C> <C>
Net earnings $ 4,809 2,897
Adjustments to reconcile net earnings to net
cash provided by operating activities:
Gain on disposition of assets (13) (161)
Realized gain on investments (233) (758)
Depreciation and amortization 9,730 7,794
Increase in deferred taxes 1,403 1,426
Deferred scheduled maintenance costs 3,148 2,401
Minority interest and earnings of
unconsolidated subsidiaries 1,002 12
Other noncash adjustments to earnings (1,427) --
Increase in cash from other changes in
operating working capital for:
Marine transportation, diesel repair and
other 7,778 7,930
Insurance 3,835 3,389
-------- -------
Net cash provided by operating activities 30,032 24,930
-------- -------
Cash flow from investing activities:
Proceeds from sale and maturities of investments 15,260 --
Purchase of investments (22,213) (23,134)
Net decrease (increase) in short-term
investments (11,563) 7,106
Capital expenditures (12,570) (4,707)
Proceeds from disposition of assets 1,047 389
-------- -------
Net cash used by investing activities (30,039) (20,346)
-------- -------
Cash flow from financing activities:
Borrowings on bank revolving credit loan 52,800 10,700
Payments on bank revolving credit loan (75,600) (21,900)
Increase in long-term debt 37,548 --
Payments under long-term debt (21,368) (1,743)
Proceeds from exercise of stock options 24 405
-------- -------
Net cash used by financing activities (6,596) (12,538)
-------- -------
Decrease in cash and invested cash (6,603) (7,954)
Cash and invested cash, beginning of year 11,840 14,936
-------- -------
Cash and invested cash, end of period $ 5,237 6,982
======== =======
Supplemented disclosures of cash flow information:
Cash paid during the period for:
Interest $ 2,206 913
Income taxes $ -- 1,850
</TABLE>
See accompanying notes to condensed financial statements.
<PAGE> 7
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
NOTES TO CONDENSED FINANCIAL STATEMENTS
In the opinion of management, the accompanying unaudited condensed
financial statements of Kirby Corporation and consolidated subsidiaries (the
"Company") contain all adjustments (consisting of only normal recurring
accruals) necessary to present fairly the financial position as of
March 31, 1995 and December 31, 1994, and the results of operations for the
three months ended March 31, 1995 and 1994.
(1) BASIS FOR PREPARATION OF THE THREE MONTH FINANCIAL STATEMENTS
The condensed financial statements included herein have been prepared by
the Company, without audit, pursuant to the rules and regulations of the
Securities and Exchange Commission. Although the Company believes that the
disclosures are adequate to make the information presented not misleading,
certain information and footnote disclosures, including significant
accounting policies, normally included in annual financial statements have
been condensed or omitted pursuant to such rules and regulations. It is
suggested that these condensed financial statements be read in conjunction
with the Company's latest Annual Report on Form 10-K.
(2) ACCOUNTING CHANGE
In March, 1995, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed
Of" ("SFAS 121"). SFAS 121 is effective for fiscal years beginning after
December 15, 1995. The Company has not completed the analysis required by
SFAS 121 and, as a result, the impact that the adoption of SFAS 121 is
expected to have on the Company's financial statements is not known. The
Company expects to adopt SFAS 121 prior to the first quarter of 1996.
<PAGE> 8
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
NOTES TO CONDENSED FINANCIAL STATEMENTS
(3) TAXES ON INCOME
Earnings before taxes on income and details of the provision for taxes
on income for United States and Puerto Rico operations for the three months
ended March 31, 1995 and 1994 are as follows:
<TABLE>
<CAPTION>
Three months ended March 31,
----------------------------
1995 1994
-------- --------
($ in thousands)
<S> <C> <C>
Earnings before taxes on income:
United States $ 5,870 2,832
Foreign 1,759 2,050
------- -----
$ 7,629 4,882
======= =====
Provision for taxes on income:
United States:
Current $ 1,699 1,068
Deferred 1,067 536
State and municipal 54 79
------- -----
$ 2,820 1,683
======= =====
Puerto Rico:
Deferred $ -- 302
======= =====
</TABLE>
(4) LONG-TERM DEBT
In December, 1994, the Company established a $250,000,000 medium term
note program providing for the issuance of fixed rate or floating rate notes
with the maturities of nine months or longer. The shelf registration program,
registered with the Securities and Exchange Commission, was activated in
March, 1995 with the issuance of $34,000,000 of the authorized notes. The
issued medium term notes bear interest at an average fixed rate of 7.77%
with a maturity of March 10, 1997. Proceeds from sale of the notes were
used to retire the Company's outstanding bank term loan in the amount of
$10,286,000 due June 1, 1997 and to reduce the Company's outstanding
revolving credit loans by $23,714,000. The Company's outstanding bank term
loan in the amount of $10,666,000, due March 6, 1997, was retired on
March 20, 1995 with proceeds borrowed under the Company's revolving credit
agreements. The remaining $216,000,000 available under the medium term note
program will provide financing for future business and equipment
acquisitions, and working capital requirements.
<PAGE> 9
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations
RESULTS OF OPERATIONS
The Company reported net earnings for the 1995 first quarter of
$4,809,000, or $.17 per share, compared with 1994 first quarter net earnings
of $2,897,000, or $.10 per share.
The Company conducts operations in three business segments: marine
transportation, diesel repair and property and casualty insurance. The sum of
the three business segments' operating income exceeds the Company's
consolidated operating income due primarily to general corporate expenses and
interest expense. A discussion of each segment follows:
MARINE TRANSPORTATION
As a provider of service for both the inland and offshore United States
markets, the marine transportation segment is divided into three divisions
organized around the markets they serve: the Inland Chemical Division,
serving the inland industrial and agricultural chemical markets; the Inland
Refined Products Division, serving the inland refined products market; and
the Offshore Division, which serves the offshore petroleum products,
container, dry-bulk and palletized cargo markets. A division analysis of the
marine transportation segment follows:
Marine Transportation - Inland Divisions
The Inland Chemical and Refined Products Divisions' transportation
revenues for the 1995 first quarter totaled $55,975,000, an increase of 21%
compared with $46,179,000 reported in the 1994 first quarter. The acquisition
from The Dow Chemical Company ("Dow") in November, 1994 of 65 inland tank
barges, the assumption of the lease of 31 tank barges from Dow and the
accompanying ten year contract with Dow to provide inland bulk liquid marine
transportation services contributed to the increase in revenues.
Utilization of equipment capacity in the Inland Chemical Division
remained relatively strong during the 1995 first quarter, consistent with the
utilization realized in the 1994 fourth quarter. Equipment utilization within
the Inland Refined Products Division remained at 1994 levels, however, spot
market rates declined sharply, affecting profitability of this division.
Equipment utilization has remained favorable since the second quarter of 1994.
Fog conditions, normal for the first quarter of the year, created certain
operating inefficiencies.
Costs and expenses, excluding interest expense, for the Inland Chemical
and Refined Products Divisions for the first quarter of 1995 totaled
$48,415,000, an increase of 21% over the corresponding 1994 first quarter when
costs and expenses totaled $40,125,000. The increase reflects the costs and
expenses associated with operating the Dow equipment acquired in
November, 1994, as well as inflationary increases in costs and expenses. The
Dow fleet has been fully integrated into the Inland Chemical Division and
expectations are for additional efficiencies from this fleet.
<PAGE> 10
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations
RESULTS OF OPERATIONS, Continued
The Inland Chemical and Refined Products Divisions' operating income for
the 1995 first quarter totaled $7,535,000, an increase of 21% compared with
1994 first quarter operating income of $6,243,000.
Marine Transportation - Offshore Division
Transportation revenues from the Offshore Division for the 1995 first
quarter declined 15% to $23,234,000 from $27,208,000 reported in the 1994
first quarter. The Offshore Division, which participates in movements of both
refined petroleum products and dry products, experienced weaknesses in spot
market rates within its liquid market and reduced demand and excess equipment
capacity within its preference aid and military cargo markets. In addition,
offshore revenues for the 1995 first quarter decreased by $1,762,000 as a
result of the de-consolidation of two offshore partnerships, which are
currently being accounted for on an equity basis. Prior year amounts have not
been restated, as the impact of the de-consolidation is not material to the
Company's balance sheet and cash flows, and there is no impact on net
earnings.
The Offshore Division's liquid segment benefited from the charters of
eight of its tank vessels concluded during the 1994 fourth quarter. Offshore
liquid capacity for the 1995 first quarter totaled 2.6 million barrels, compared
with 2.8 million for the 1994 fourth quarter and 1.9 million for the 1994
first quarter. Such capacity reflects the acquisition of four tankers in
July, 1994 and the scrapping of one tanker in January, 1995, in accordance
with the designated vessel retirements under the Oil Pollution Act of 1990
("OPA 90").
During the 1995 first quarter, even though utilization improved, rates for
the three tank vessels operating in the spot market declined significantly, as
movements of heating oil, normally high during the first quarter of the year,
did not materialize due to the unusually mild winter in the Northeast.
Prospects for the second quarter of 1995 remain favorable as spot market rates
and equipment utilization should improve to some degree as the summer driving
season approaches. Full recovery of the offshore tank vessels' market is
anticipated to be gradual, over the next few years, as offshore tank vessels
are removed from service under OPA 90.
<PAGE> 11
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations
RESULTS OF OPERATIONS, Continued
Movements for the transportation of food commodities and related products
under the United States Government's preference aid cargo programs and military
household goods movements have also remained weak. Excess equipment capacities
and a reduction in available movements have led to rates that are significantly
lower than 1994 first quarter rates. Such continued market softness resulted
in one of the Company's break-bulk freighters to be idle for substantially all
of the 1995 first quarter. The depressed markets have also continued to
negatively affect the Company's other offshore dry cargo barge and tug units
that primarily work under a long-term contract with an electric utility
company, but periodically operate in the preference aid market as a supplement
to their long-term contract movements. Such low levels resulted in equipment
utilization in the Company's dry cargo segment to decline to 79% for the first
quarter of 1995 compared with 84% for the 1994 first quarter and 95% for the
1994 fourth quarter. Deadweight capacity of 97,000 tons remained constant
during each comparable period.
Prospects for the 1995 second quarter mirror the first quarter as
announced preference aid movements remain low, which will probably result in
additional lay ups of the Company's three break-bulk freighters during the
1995 second quarter. Prospects for the second half of 1995 offer some
encouragement as announced movements are increasing and a competitor is
scrapping at least eight vessels during 1995. Such vessels have participated
in preference aid and military cargo movements in the past.
Costs and expenses, excluding interest expense, for the Offshore Division
for the first quarter of 1995 totaled $22,461,000, a decrease of 16% over the
corresponding 1994 first quarter when costs and expenses totaled $26,787,000.
Costs and expenses of the two offshore partnerships accounted for effective
January 1, 1995 on the equity in earnings method from the pro rata method
totaled $1,533,000 for the 1995 first quarter. The costs and expenses of the
four offshore tank vessels acquired in July, 1994, and reflected in the 1995
first quarter also accounted for the variance from period to period. Costs
and expenses for the 1994 first quarter included an estimated $1,750,000 of
costs associated with the collection of containers from several voyages
carrying preference aid cargo to Haiti which, during that time, was politically
unstable.
The Offshore Division's operating income for the 1995 first quarter
totaled $942,000 compared with $446,000 of operating income for the 1994 first
quarter.
<PAGE> 12
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations
RESULTS OF OPERATIONS, Continued
DIESEL REPAIR
The Company's diesel repair segment reported diesel repair revenues for
the 1995 first quarter of $14,025,000, an increase of 38% compared with
revenues of $10,171,000 for the 1994 first quarter.
The diesel repair segment is divided into two divisions organized around
the markets they serve. The Marine Diesel Repair Division operates on all three
coasts and in the Midwest through five facilities that repair and overhaul
marine diesel engines and reduction gears, and sell related parts and
accessories. The Rail Diesel Repair Division provides replacement parts,
service and support nationwide to shortline railroads and industrial companies
that operate locomotives.
The Marine Diesel Repair Division's revenues for the 1995 first quarter
increased to $11,617,000, an increase of 36% compared with $8,521,000 reported
for the 1994 first quarter. Operating in a very competitive market, the Gulf
Coast and Midwest markets benefited from the economic recovery in the inland
dry cargo carrier industry. The East Coast market continued to reflect
improvements from military customers while the West Coast market continued to
slowly rebound from a depressed tuna fishing market.
The Rail Diesel Repair Division, which commenced operations in January,
1994, reported revenues for the 1995 first quarter of $2,408,000, an increase
of 46% compared with first quarter 1994 revenues of $1,650,000. The division
serves as the exclusive shortline and industrial rail distributor of
aftermarket parts and service for the Electro-Motive Division of General
Motors.
Costs and expenses, excluding interest expense, for the diesel repair
segment totaled $12,988,000, an increase of 35% compared with $9,637,000
reported for 1994 first quarter. The increase reflected the overall growth in
revenues from both divisions.
The diesel repair segment's operating income for the first quarter of
1995 totaled $1,076,000, an increase of 98% compared with 1994 first quarter
operating income of $544,000.
<PAGE> 13
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations
RESULTS OF OPERATIONS, Continued
PROPERTY AND CASUALTY INSURANCE
The Company's property and casualty insurance segment reported premiums
written of $35,901,000 for the first quarter of 1995, an increase of 37%
compared with premiums written of $26,117,000 for the 1994 first quarter. The
continued improvement in the Puerto Rico economy, an expanding customer base
and the increase in the number of new automobiles sold in Puerto Rico
contributed significantly to the increase.
Net premiums earned for the 1995 first quarter totaled $21,067,000
compared with $14,110,000 for the 1994 first quarter, reflecting the continued
emphasis in the automobile lines of insurance, particularly the vehicle
single-interest and double-interest lines. Net premiums earned represent the
amortization of net premiums written over the life of the policy. Net
premiums written have increased annually since 1992, thereby increasing the
amount amortized to net premiums earned.
Losses, claims and settlement expenses for the 1995 first quarter totaled
$14,569,000 compared with $11,625,000 for the 1994 first quarter. The 1994
first quarter losses, claims and settlement expenses included a $2,000,000
additional reserve for potential, but as yet unreported, losses associated with
the Company's Bermuda reinsurance subsidiary. Since ceasing participation in
the reinsurance market in 1990, the Company continues to seek a withdrawal from
this business and closure of the Bermuda subsidiary's activities, including
commutation of the subsidiary's book of business. A commutation would entail
the transfer of liability from known and incurred but not reported losses to a
second party in exchange for a portion of, or all of, the subsidiary's assets.
The Company's portion of the property and casualty insurance segment's
pretax earnings for the 1995 first quarter totaled $1,759,000 compared with
$50,000 for the like 1994 period. Minority interest expense for the 1995
first quarter totaled $1,173,000, based on 58% voting ownership of the Puerto
Rico subsidiary. Minority interest expense for the 1994 first quarter totaled
$646,000, based on 67% voting ownership.
CORPORATE EXPENSES
Interest expense for the 1995 first quarter totaled $2,910,000, reflecting
a 61% increase over $1,809,000 reported for the 1994 first quarter.
Such increase represents interest on the increased revolving bank debt to
finance the Dow asset acquisition in November, 1994, the four tankers acquired
in July, 1994, and the hike in the short-term interest rate from the first
quarter of 1994 through the first quarter of 1995.
<PAGE> 14
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations
FINANCIAL CONDITION, CAPITAL RESOURCES AND LIQUIDITY
Stock Repurchase
From April 24, 1995 through May 5, 1995, the Company repurchased 172,400
shares of common stock at a total price of $2,413,854, for an average price of
$14.00. The Company has 1,827,600 shares remaining under the 2,000,000 common
share repurchase authorization approved by the Board of Directors in
August, 1994. The Company is authorized to purchase the common stock on the
American Stock Exchange and in privately negotiated transactions. When
purchasing common stock, the Company is subject to price, trading volume and
other market considerations. Shares repurchased may be used for reissuance
upon the exercise of stock options, in future acquisitions for stock or for
other appropriate corporate purposes.
Long-Term Financing
In December, 1994, the Company established a $250,000,000 medium term
note program providing for the issuance of fixed rate or floating rate notes
with the maturities of nine months or longer. The shelf registration program,
registered with the Securities and Exchange Commission, was activated in
March, 1995 with the issuance of $34,000,000 of the authorized notes. The
issued medium term notes bear interest at an average fixed rate of 7.77%
with a maturity of March 10, 1997. Proceeds from sale of the notes were used
to retire the Company's outstanding bank term loan in the amount of
$10,286,000 due June 1, 1997 and to reduce the Company's outstanding revolving
credit loans by $23,714,000. The Company's outstanding bank term loan in the
amount of $10,666,000, due March 6, 1997, was retired on March 20, 1995 with
proceeds borrowed under the Company's revolving credit agreements. The
remaining $216,000,000 available under the medium term note program will
provide financing for future business and equipment acquisitions and working
capital requirements.
Capital Expenditures
In May, 1994, the Company entered into a contract for the construction of
12 double skin 29,000 barrel capacity inland tank barges for use in the
movement of industrial chemicals and refined products. In February, 1995, the
Company exercised the option under the contract to construct 12 additional
barges. Since January, 1995, the Company has received one barge each month and
the remaining barges are scheduled to be delivered one each month thereafter.
The new construction program is consistent with the Company's long-term
strategy of upgrading its equipment to service the needs of its customers and
to enhance its market position.
<PAGE> 15
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
Management's Discussion and Analysis of
Financial Condition and Results of Operations
FINANCIAL CONDITION, CAPITAL RESOURCES AND LIQUIDITY, Continued
Accounting Change
In March, 1995, the Financial Accounting Standards Board issued Statement
of Financial Accounting Standards No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to Be Disposed Of" ("SFAS 121").
SFAS 121 is effective for fiscal years beginning after December 15, 1995. The
Company has not completed the analysis required by SFAS 121 and, as a result,
the impact that the adoption of SFAS 121 is expected to have on the Company's
financial statements is not known. The Company expects to adopt SFAS 121 prior
to the first quarter of 1996.
Liquidity
The Company has generated substantial cash flow from its operating
segments to fund its capital expenditures, asset acquisitions, debt service
and other operation requirements. The Company generated net cash provided by
operating activities of $30,032,000 for the 1995 first quarter compared with
$24,930,000 for the 1994 first quarter.
During each year, inflation has had a relatively minor effect on the
financial results of the Company. The marine transportation segment has
long-term contracts which generally contain cost escalation clauses whereby
certain costs, including fuel can be passed through to its customers, while the
segment's short-term, or spot business, is based principally on current prices.
In addition, the marine transportation assets acquired and accounted for using
the purchase method of accounting were adjusted to a fair market value and,
therefore, the cumulative long-term effect on inflation was reduced. The
repair portion of the diesel repair segment is based on prevailing current
market rates. For the property and casualty insurance segment, 100% of its
investments were classified as available-for-sale securities, which consist
primarily of United States Governmental instruments.
Universal is subject to dividend restrictions under the stockholders
agreement between the Company, Universal and Eastern America Financial Group,
Inc. In addition, Universal is subject to industry guidelines and regulations
with respect to the payment of dividends.
The Company has no present plan to pay dividends on common stock in the
near future.
<PAGE> 16
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
For a detailed explanation of the material pending legal proceedings
against the Company, please refer to the Form 10-K for the year ended
December 31, 1994.
Item 4. Results of Votes of Security Holders
(a) The Registrant held its Annual Meeting of Stockholders on
April 18, 1995.
(b) Proxies for the meeting were solicited pursuant to Regulation 14;
there was no solicitation in opposition to management's nominees for
directors as listed in the Proxy Statement, and all such nominees
were re-elected.
Directors elected were George F. Clements, Jr., J. Peter Kleifgen,
William M. Lamont, Jr., C. W. Murchison, III,
George A. Peterkin, Jr., J. H. Pyne, Robert G. Stone, Jr. and
J. Virgil Waggoner. No other directors previously in office continued
as a director or continued in office after the meeting.
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits:
11.0 Computation of Earnings per Common Share.
(b) Reports on Form 8-K:
There were no reports on Form 8-K filed for the three months ended
March 31, 1995.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Kirby Corporation
(Registrant)
By: /s/ G. Stephen Holcomb
______________________
G. Stephen Holcomb
Vice President and Controller
Dated: May 10, 1995
EXHIBIT 11.0
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
COMPUTATION OF EARNINGS PER COMMON SHARE
<TABLE>
<CAPTION>
Three months ended March 31,
----------------------------
1995 1994
----------- -----------
($ in thousands, except
per share amount)
<S> <C> <C>
Net earnings $ 4,809 2,897
======== ======
Shares:
Weighted average number of common shares
outstanding 28,440 28,382
Common equivalent shares for dilutive effect of
assumed exercise of stock options 344 315
------- ------
28,784 28,697
======= ======
Earnings per share of common stock $ .10 .17
======= ======
</TABLE>
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM
CONSOLIDATED BALANCE SHEETS AND STATEMENTS OF EARNINGS AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> MAR-31-1995
<CASH> 3,544
<SECURITIES> 12,536
<RECEIVABLES> 58,443
<ALLOWANCES> 713
<INVENTORY> 8,582
<CURRENT-ASSETS> 96,596
<PP&E> 465,176
<DEPRECIATION> 145,659
<TOTAL-ASSETS> 689,407
<CURRENT-LIABILITIES> 65,866
<BONDS> 142,999
<COMMON> 3,078
0
0
<OTHER-SE> 227,209
<TOTAL-LIABILITY-AND-EQUITY> 689,407
<SALES> 11,170
<TOTAL-REVENUES> 118,618
<CGS> 8,771
<TOTAL-COSTS> 82,916
<OTHER-EXPENSES> 12,320
<LOSS-PROVISION> 2
<INTEREST-EXPENSE> 2,910
<INCOME-PRETAX> 7,629
<INCOME-TAX> 2,820
<INCOME-CONTINUING> 4,809
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 4,809
<EPS-PRIMARY> .17
<EPS-DILUTED> .17
<FN>
<F1>ALL INSURANCE ASSETS AND LIABILITIES ARE ASSUMED TO BE NON-CURRENT.
</FN>
</TABLE>
