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Kirby (KEX) Q3 Earnings Top Estimates, Revenues Miss
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Kirby Corporation (KEX - Free Report) reported mixed third-quarter 2022 results wherein earnings outpaced the Zacks Consensus Estimate but revenues missed the same.
Quarterly earnings of 65 cents per share outpaced the Zacks Consensus Estimate of 60 cents and improved more than 100% year over year. Total revenues of $745.8 million missed the Zacks Consensus Estimate of $748.4 million. However, the top line improved 25% year over year on the back of higher revenues in the marine transportation and distribution and services segments. Total costs and expenses (on a reported basis) declined 24.9% year over year to $686.94 million.
Kirby Corporation Price, Consensus and EPS Surprise
The company operates via two segments, namely, marine transportation and distribution and services.
In the third quarter, revenues in the marine transportation unit increased 27.9% year over year to $433.04 million. Segmental operating income jumped to $41.7 million in the reported quarter compared with $16.9 million in the year-ago period. Operating margin improved to 9.6% compared with 5% in the year-ago period.
Inland market revenues accounted for 80% of the segmental revenues. Revenues in the inland market grew 35% year over year, owing to increased volumes, barge utilization, pricing and fuel rebills. The operating margin for the inland business improved in the low double digits despite ongoing headwinds from high fuel costs and inflationary pressures.
Revenues in the coastal market grew 6% year over year and accounted for 20% of the segmental revenues. The coastal market recorded an improvement in operating margin in the low-to-mid single digits during the quarter. Average barge utilization in the September quarter was in the low-90% range.
In the distribution and services segment, revenues rose 20.1% to $312.80 million. Segmental operating income jumped to $22.3 million in the reported quarter compared with $11 million in the year-ago period. Moreover, the segment reported an operating margin of 7.1% in the third quarter of 2022 compared with 4.2% in third-quarter 2021.
The commercial and industrial sub-group, which accounted for 53% of the segmental revenues, benefited from strong economic activity across the United States, which resulted in higher business levels in marine repair, power generation and on-highway. The operating margin at the commercial and industrial sub-group was in the high-single digits.
The oil and gas sub-group, which accounted for 47% of the segmental revenues during the reported quarter, benefited from higher oilfield activity, resulting in increased demand for new transmissions and parts in the distribution business. The segment had an operating margin in the mid-single digits.
Balance Sheet Highlights & Cash Flow
As of Sep 30, 2022, Kirby had cash and cash equivalents of $37 million compared with $25.1 million at the end of June 2022. Total debt was $1,118.5 million at the end of the third quarter compared with $1,136.1 million at the end of June 2022.
During the reported quarter, KEX generated $65.6 million of net cash from operating activities, and capital expenditures came in at $41.2 million. Free cash flowwas $24.4 million.
2022 Outlook
Kirby anticipates net cash generated from operating activities between $390 million and $450 million. Free cash flow is expected in the range of $200-$280 million in 2022. Kirby anticipates capital expenditures in the range of $170-$190 million.
Delta AirLines’(DAL - Free Report) third-quarter 2022 earnings (excluding 42 cents from non-recurring items) of $1.51 per share fell short of the Zacks Consensus Estimate of $1.56. Escalated operating expenses induced the earnings miss. Multiple flight cancelations and booking weaknesses due to Hurricane Ian also hurt results. DAL reported earnings of 30 cents per share a year ago, dull in comparison to the current scenario, as air-travel demand was not so buoyant then.
DAL reported revenues of $13,975 million, which lagged the Zacks Consensus Estimate of $14,157.2 million. Driven by the high air-travel demand, total revenues increased more than 52% on a year-over-year basis.
United Airlines’ (UAL - Free Report) third-quarter 2022 earnings (excluding 5 cents from non-recurring items) of $2.81 per share beat the Zacks Consensus Estimate of $2.21 and our estimate of $2.17. An upbeat in air-travel demand aided results.
In the year-ago quarter, UAL incurred a loss of $1.02 per share when air-travel demand was not as buoyant as in the current scenario. The third quarter of 2022 was the second consecutive profitable quarter at UAL since the onset of the pandemic.
Operating revenues of $12,877 million beat the Zacks Consensus Estimate of $12,709.5 million and our estimate of $12, 631.6 million. UAL’s revenues increased more than 66% year over year owing to an upbeat in air-travel demand. The optimistic air-travel demand scenario is also evident from the fact that total operating revenues increased 13.2% from third-quarter 2019 (pre-coronavirus) levels.
J.B. Hunt Transport Services, Inc. (JBHT - Free Report) reported better-than-expected third-quarter 2022 results, wherein both earnings and revenues outperformed the Zacks Consensus Estimate. JBHT’s quarterly earnings of $2.57 per share surpassed the Zacks Consensus Estimate of $2.45 and improved 36.7% year over year.
JBHT’s operating revenues of $3,838.3 million also outperformed the Zacks Consensus Estimate of $3803.4 million. The top line jumped 22.1% year over year on the back of strength across — Dedicated Contract Services, Intermodal, Truckload and Final Mile Services segments. Total operating revenues, excluding fuel surcharges, rose 12.4% year over year.
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Kirby (KEX) Q3 Earnings Top Estimates, Revenues Miss
Kirby Corporation (KEX - Free Report) reported mixed third-quarter 2022 results wherein earnings outpaced the Zacks Consensus Estimate but revenues missed the same.
Quarterly earnings of 65 cents per share outpaced the Zacks Consensus Estimate of 60 cents and improved more than 100% year over year. Total revenues of $745.8 million missed the Zacks Consensus Estimate of $748.4 million. However, the top line improved 25% year over year on the back of higher revenues in the marine transportation and distribution and services segments. Total costs and expenses (on a reported basis) declined 24.9% year over year to $686.94 million.
Kirby Corporation Price, Consensus and EPS Surprise
Kirby Corporation price-consensus-eps-surprise-chart | Kirby Corporation Quote
Segmental Performance
The company operates via two segments, namely, marine transportation and distribution and services.
In the third quarter, revenues in the marine transportation unit increased 27.9% year over year to $433.04 million. Segmental operating income jumped to $41.7 million in the reported quarter compared with $16.9 million in the year-ago period. Operating margin improved to 9.6% compared with 5% in the year-ago period.
Inland market revenues accounted for 80% of the segmental revenues. Revenues in the inland market grew 35% year over year, owing to increased volumes, barge utilization, pricing and fuel rebills. The operating margin for the inland business improved in the low double digits despite ongoing headwinds from high fuel costs and inflationary pressures.
Revenues in the coastal market grew 6% year over year and accounted for 20% of the segmental revenues. The coastal market recorded an improvement in operating margin in the low-to-mid single digits during the quarter. Average barge utilization in the September quarter was in the low-90% range.
In the distribution and services segment, revenues rose 20.1% to $312.80 million. Segmental operating income jumped to $22.3 million in the reported quarter compared with $11 million in the year-ago period. Moreover, the segment reported an operating margin of 7.1% in the third quarter of 2022 compared with 4.2% in third-quarter 2021.
The commercial and industrial sub-group, which accounted for 53% of the segmental revenues, benefited from strong economic activity across the United States, which resulted in higher business levels in marine repair, power generation and on-highway. The operating margin at the commercial and industrial sub-group was in the high-single digits.
The oil and gas sub-group, which accounted for 47% of the segmental revenues during the reported quarter, benefited from higher oilfield activity, resulting in increased demand for new transmissions and parts in the distribution business. The segment had an operating margin in the mid-single digits.
Balance Sheet Highlights & Cash Flow
As of Sep 30, 2022, Kirby had cash and cash equivalents of $37 million compared with $25.1 million at the end of June 2022. Total debt was $1,118.5 million at the end of the third quarter compared with $1,136.1 million at the end of June 2022.
During the reported quarter, KEX generated $65.6 million of net cash from operating activities, and capital expenditures came in at $41.2 million. Free cash flowwas $24.4 million.
2022 Outlook
Kirby anticipates net cash generated from operating activities between $390 million and $450 million. Free cash flow is expected in the range of $200-$280 million in 2022. Kirby anticipates capital expenditures in the range of $170-$190 million.
Currently, Kirby carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Performance of Other Transportation Companies
Delta AirLines’(DAL - Free Report) third-quarter 2022 earnings (excluding 42 cents from non-recurring items) of $1.51 per share fell short of the Zacks Consensus Estimate of $1.56. Escalated operating expenses induced the earnings miss. Multiple flight cancelations and booking weaknesses due to Hurricane Ian also hurt results. DAL reported earnings of 30 cents per share a year ago, dull in comparison to the current scenario, as air-travel demand was not so buoyant then.
DAL reported revenues of $13,975 million, which lagged the Zacks Consensus Estimate of $14,157.2 million. Driven by the high air-travel demand, total revenues increased more than 52% on a year-over-year basis.
United Airlines’ (UAL - Free Report) third-quarter 2022 earnings (excluding 5 cents from non-recurring items) of $2.81 per share beat the Zacks Consensus Estimate of $2.21 and our estimate of $2.17. An upbeat in air-travel demand aided results.
In the year-ago quarter, UAL incurred a loss of $1.02 per share when air-travel demand was not as buoyant as in the current scenario. The third quarter of 2022 was the second consecutive profitable quarter at UAL since the onset of the pandemic.
Operating revenues of $12,877 million beat the Zacks Consensus Estimate of $12,709.5 million and our estimate of $12, 631.6 million. UAL’s revenues increased more than 66% year over year owing to an upbeat in air-travel demand. The optimistic air-travel demand scenario is also evident from the fact that total operating revenues increased 13.2% from third-quarter 2019 (pre-coronavirus) levels.
J.B. Hunt Transport Services, Inc. (JBHT - Free Report) reported better-than-expected third-quarter 2022 results, wherein both earnings and revenues outperformed the Zacks Consensus Estimate. JBHT’s quarterly earnings of $2.57 per share surpassed the Zacks Consensus Estimate of $2.45 and improved 36.7% year over year.
JBHT’s operating revenues of $3,838.3 million also outperformed the Zacks Consensus Estimate of $3803.4 million. The top line jumped 22.1% year over year on the back of strength across — Dedicated Contract Services, Intermodal, Truckload and Final Mile Services segments. Total operating revenues, excluding fuel surcharges, rose 12.4% year over year.