Page 45: of Marine News Magazine (August 2019)

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FEATURE: INLAND MARINE OPERATORS

Interestingly, Kirby’s share of the inland tank-barge mar-

Kirby Corporation

Houston-headquartered Kirby Corp has been active ket has remained stable. While it is 28% today – a sig- buying ? eets over the past few years. Since the beginning ni? cant two-year gain, from 22% in 2017 – Kirby had 30-32% of market capacity in 2002-08. Financial analysts, of 2016, Kirby has spent $953 million on vessel acquisi- tions. Kirby now operates 1,066 inland tank barges; that’s though, don’t see that as a weakness because market share out of a total of 3,817 barges on the water, a market share is not the same as ? nancial returns from richer, but not of 28%. In April, its market capitalization was around $4.5 necessarily bigger, investment decisions. Randy Giveans, billion. All of that makes Kirby an enviable giant across an analyst with Jefferies Group LLC, an investment and ? nancial services company, called a 30% market share the any sector of the U.S. merchant ? eet.

There’s a strategy behind these big money moves. By “sweet spot” because “if (Kirby) owned 50% of the market, they’d be competing against themselves for a lot of cargoes using capital markets and banking access to ? nance take- and a lot of ? xtures.” overs, Kirby has sharply reduced the age of its inland tank-

The size and scale of Kirby’s ? eet provides operational barge ? eet, which in turn lowers maintenance costs to the bene? t of margins. Kirby’s inland barges’ average age was advantages. Giveans, with Jefferies, cited “contracts of af- 24-25 years throughout 2000-08, and has fallen ever since, freightment” (COAs) as an example. A smaller company, down to just 13 years in 2019. Compare that to national say with 200 barges, would encounter more dif? cult logis- numbers: In 2008, the average age of US tank barges was tics trying to move their equipment to where it’s needed, 23 years, just below Kirby’s average age. Today, the average when it’s needed. A 1,000 barge resource base is likely to be more distributed geographically, making it easier to age is 16 years, three more than Kirby’s.

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