Kirby inks ATB trio

Kirby Corp turned heads Wednesday after unveiling plans to construct three more articulated tug barges (ATBs).
Pyne stepped down as CEO but will continue to serve as chairman.

Pyne stepped down as CEO but will continue to serve as chairman.

In the New York-listed operator’s first-quarter earnings report management said the decision is a reflection of rising demand for tonnage that is eligible to operate in the US cabotage trade, which is governed by the Jones Act.

The company indicated that it exercised an option to construct a second 185,000-barrel tank barge and 10,000-hp tug, which will cost roughly $75m in total and is due for delivery in the first half of 2016, just 24 hours ago.

“Including progress payments for this unit and previously announced increases in our inland construction program, we now expect our 2014 capital spending to be in the $320 to $330m range,” added David Grzebinski, who replaced Joe Pyne as CEO earlier this week.

In addition to the option management said Kirby’s board of directors also approved a request to construct two more ATBs. The company failed to elaborate further but indicated it plans to disclose more details and update the capital expenditure forecast when pen meets paper.

The commentary came as the operator reported net earnings of $62.3m for the three months to 31 March, versus a gain of $57.5m in the same stretch of 2013. Earnings before interest, taxes, depreciation and amortization rose to $146.9m from $139.9 year-on-year.

Kirby said its latest capital spending estimate includes $135m for the construction of 66 inland tank barges and one tug plus $80 worth of progress payments for the two 185,000-barrel ATBs. The balance relates what was described as “capital upgrades and improvements”.

Kirby Corp
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What's an ATB?

ATB is an acronym for articulated tug-barge...

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