Kirby Corporation (KEX)
JPMorgan Aviation, Transportation & Defense Conference Call
March 15, 2012 11:10 am ET
Joseph H. Pyne – Chairman and Chief Executive Officer
David W. Grzebinski – Executive Vice President and Chief Financial Officer
Okay, we’re going to kick off the next presentation this morning. With us today, we’ve got Joe Pyne, who is the CEO, and also Chairman of Board of Kirby Corporation.
And with that, we’re going to hand it straight over to Joe.
Joseph H. Pyne
Okay, good morning. Kirby is in two operating businesses. We’re in the marine transportation business, and the diesel engine service business. About 65% of our business, marine transportation and 35% diesel engine services. I’m going to come back and drill down to both these businesses a little later in this presentation. Just some market facts about Kirby.
We have a market cap of a little over $3.8 billion, enterprise value a little better than $4.5 billion. We’re the largest, both inland and coastal tank barge operator. On the coastal size, we’re measuring that market at barges 185,000 barrels of capacity or less.
Size does matter in this business. We think that we enjoy some economies of scale that smaller operators don’t enjoy. But 75% of the inland transportation revenues are on contracts a year or longer. In the coastal side of the business, about 60% of that revenue is under contract. A time charter is where a customer takes a tow on a daily basis in the inland side of the business. But 55% of the business is time charters, and the coastal business traditionally has a much higher portion of their business under time charters.