Kirby

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form 10-K

(Mark One)
☒
For the fiscal year ended December 31, 2021

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

or

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

☐
For the transition period from to

Commission File no. 1-07615

Kirby Corporation

(Exact name of registrant as specified in its charter)

Nevada
(State or other jurisdiction of incorporation or organization)
55 Waugh Drive, Suite 1000
Houston, Texas
(Address of principal executive offices)

74-1884980
(I.R.S. Employer Identification No.)

77007
(Zip Code)

Registrant’s telephone number, including area code:
713-435-1000
Securities registered pursuant to Section 12(b) of the Act:

Title of each class
Common Stock

Trading Symbol(s)
KEX

Name of each exchange on which registered
New York Stock Exchange 

Securities registered pursuant to Section 12(g) of the Act:
None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☒ No ☐
Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act. Yes ☐ No ☒
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 ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 
405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit 
and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, 
or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging 
growth company” in Rule 12b-2 of the Exchange Act. (Check one):
Large accelerated filer
Non-accelerated filer

☒
☐

Accelerated filer
Smaller reporting company
Emerging growth company

☐
☐
☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with 

any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its 
internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm 
that prepared or issued its audit report. ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐ No ☒
The aggregate market value of common stock held by non-affiliates of the registrant as of June 30, 2021, based on the closing sales price of such 
stock on the New York Stock Exchange on June 30, 2021, was $3,605,823,000. For purposes of this computation, all executive officers, directors and 
10% beneficial owners of the registrant are deemed to be affiliates. Such determination should not be deemed an admission that such executive officers, 
directors and 10% beneficial owners are affiliates.

As of February 17, 2022, 60,201,000 shares of common stock were outstanding.

DOCUMENTS INCORPORATED BY REFERENCE
Portions of the Company’s definitive proxy statement in connection with the Annual Meeting of Stockholders to be held April 26, 2022, to be 

filed with the Commission pursuant to Regulation 14A, are incorporated by reference into Part III of this report.

 
 
 
 
KIRBY CORPORATION
2021 FORM 10-K
TABLE OF CONTENTS

PART I

Item 1. Business

THE COMPANY

Documents and Information Available on Website

BUSINESS AND PROPERTY
MARINE TRANSPORTATION

Marine Transportation Industry Fundamentals
Inland Tank Barge Industry
Coastal Tank Barge Industry
Competition in the Tank Barge Industry
Products Transported
Demand Drivers in the Tank Barge Industry
Marine Transportation Operations
Contracts and Customers
Properties
Governmental Regulations
Environmental Regulations

DISTRIBUTION AND SERVICES

Commercial and Industrial Operations
Commercial and Industrial Customers
Commercial and Industrial Competitive Conditions
Oil and Gas Operations
Oil and Gas Customers
Oil and Gas Competitive Conditions
Properties
Human Capital
Information about the Company’s Executive Officers

Item 1A. Risk Factors
Item 1B. Unresolved Staff Comments
Item 2. Properties
Item 3. Legal Proceedings
Item 4. Mine Safety Disclosures

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Item 6. Reserved
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations
Item 7A. Quantitative and Qualitative Disclosures about Market Risk
Item 8. Financial Statements and Supplementary Data
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Item 9A. Controls and Procedures
Item 9B. Other Information
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

PART III

Items 10 Through 14

PART IV

Item 15. Exhibits and Financial Statement Schedules
Item 16. Form 10-K Summary

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Item 1. Business

PART I

THE COMPANY

Kirby  Corporation  (the  “Company”)  is  the  nation’s  largest  domestic  tank  barge  operator,  transporting  bulk  liquid  products 
throughout the Mississippi River System, on the Gulf Intracoastal Waterway, and coastwise along all three United States coasts. The 
Company  transports  petrochemicals,  black  oil,  refined  petroleum  products,  and  agricultural  chemicals  by  tank  barge.    Through  its 
distribution and services segment, the Company sells after-market service and genuine replacement parts for engines, transmissions, 
reduction gears, and power generation equipment used in oil and gas and commercial and industrial applications. The Company also 
rents a variety of power generation and industrial equipment, manufactures and remanufactures oilfield service equipment, including 
pressure pumping units, and manufactures electric power generation equipment for oilfield customers.

Unless  the  context  otherwise  requires,  all  references  herein  to  the  Company  include  the  Company  and  its  subsidiaries.    The 
Company’s principal executive office is located at 55 Waugh Drive, Suite 1000, Houston, Texas 77007, and its telephone number is 
713-435-1000.  The  Company’s  mailing  address  is  P.O.  Box  1745,  Houston,  Texas  77251-1745.  Kirby  Corporation  is  a  Nevada 
corporation and was incorporated in 1969 although the history of the Company goes back to 1921.

Documents and Information Available on Website

The Internet address of the Company’s website is http://www.kirbycorp.com. The Company makes available free of charge through 
its  website,  all  of  its  filings  with  the  Securities  and  Exchange  Commission  (“SEC”),  including  its  Annual  Report  on  Form  10-K, 
Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports, as soon as reasonably practicable 
after they are electronically filed with or furnished to the SEC.  The SEC maintains an internet site at http://www.sec.gov that contains 
reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC.

The following documents are available on the Company’s website in the Investor Relations section under Corporate Governance:







Audit Committee Charter
Compensation Committee Charter
ESG and Nominating Committee Charter
Business Ethics Guidelines
Corporate Governance Guidelines

The  Company  is  required  to  make  prompt  disclosure  of  any  amendment  to  or  waiver  of  any  provision  of  its  Business  Ethics 
Guidelines that applies to any director or executive officer or to its chief executive officer, chief financial officer, chief accounting 
officer or controller or persons performing similar functions. The Company will make any such disclosure that may be necessary by 
posting the disclosure on its website in the Investor Relations section under Corporate Governance.

BUSINESS AND PROPERTY

The  Company,  through  its  subsidiaries,  conducts  operations  in  two  reportable  business  segments:  marine  transportation  and 

distribution and services.

The Company, through its marine transportation segment, is a provider of marine transportation services, operating tank barges and 
towing  vessels  transporting  bulk  liquid  products  throughout  the  Mississippi  River  System,  on  the  Gulf  Intracoastal  Waterway,  and 
coastwise  along  all  three  United  States  coasts.  The  Company  transports  petrochemicals,  black  oil,  refined  petroleum  products,  and 
agricultural  chemicals  by  tank  barge.  The  Company  operates  offshore  dry-bulk  barge  and  tugboat  units  engaged  in  the  offshore 
transportation of dry-bulk cargoes in the United States coastal trade. The segment is a provider of transportation services for its customers 
and, in almost all cases, does not assume ownership of the products that it transports. All of the Company’s vessels operate under the 
United States flag and are qualified for domestic trade under the Jones Act.

The Company, through its distribution and services segment, sells after-market service and genuine replacement parts for engines, 
transmissions,  reduction  gears,  electric  motors,  drives,  and  controls,  specialized  electrical  distribution  and  control  systems,  energy 
storage battery systems, and related oilfield services equipment, rebuilds component parts or entire diesel engines, transmissions and 
reduction gears, and related equipment used in oilfield services, marine, power generation, on-highway and other industrial applications.  
The Company also rents equipment including generators, industrial compressors, high capacity lift trucks, and refrigeration trailers for 
use in a variety of industrial markets, and manufactures and remanufactures oilfield service equipment, including pressure pumping 
units,  and  manufacturers  electric  power  generation  equipment,  specialized  electrical  distribution  and  control  equipment,  and  high 
capacity energy storage/battery systems for oilfield customers.

The Company has approximately 5,125 employees, the large majority of whom are in the United States.

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MARINE TRANSPORTATION

The marine transportation segment is primarily a provider of transportation services by tank barge for the inland and coastal markets. 
As of December 31, 2021, the equipment owned or operated by the marine transportation segment consisted of 1,025 inland tank barges 
with 22.9 million barrels of capacity, and an average of 255 inland towboats during the fourth quarter of 2021, as well as 31 coastal tank 
barges with 3.1 million barrels of capacity, 29 coastal tugboats, four offshore dry-bulk cargo barges, four offshore tugboats and one 
docking tugboat with the following specifications and capacities:

Class of equipment
Inland tank barges (owned and leased):

Regular double hull:

20,000 barrels and under
Over 20,000 barrels
Specialty double hull

Total inland tank barges

Inland towboats (owned and chartered):

800 to 1300 horsepower
1400 to 1900 horsepower
2000 to 2400 horsepower
2500 to 3200 horsepower
3300 to 4800 horsepower
Greater than 5000 horsepower

Total inland towboats

Coastal tank barges (owned and leased):

30,000 barrels and under
50,000 to 70,000 barrels
80,000 to 90,000 barrels
100,000 to 110,000 barrels
120,000 to 150,000 barrels
Over 150,000 barrels

Total coastal tank barges

Coastal tugboats (owned and chartered):

2000 to 2900 horsepower
3000 to 3900 horsepower
4000 to 4900 horsepower
5000 to 6900 horsepower
Greater than 7000 horsepower

Total coastal tugboats

Offshore dry-bulk cargo barges (owned)

Offshore tugboats and docking tugboat (owned and chartered)

Number in
class

Average age
(in years)

Barrel
capacities

348
623
54
1,025

34
26
148
33
9
5
255

2
4
10
6
3
6
31

1
3
8
11
6
29

4

5

4,050,000
17,907,000
913,000
22,870,000

37,000
163,000
849,000
630,000
416,000
1,046,000
3,141,000

Deadweight
Tonnage

67,000

14.5
12.9
36.3
14.7

34.9
22.1
11.7
10.9
21.2
22.1
16.3

27.1
15.2
18.3
15.5
20.0
6.1
15.7

46.1
32.7
12.2
5.7
11.5
12.2

23.1

30.5

The 255 inland towboats, 29 coastal tugboats, four offshore tugboats and one docking tugboat provide the power source and the 
1,025 inland tank barges, 31 coastal tank barges and four offshore dry-bulk cargo barges provide the freight capacity for the marine 
transportation segment. When the power source and freight capacity are combined, the unit is called a tow. The Company’s inland tows 
generally consist of one towboat and from one to up to 25 tank barges, depending upon the horsepower of the towboat, the waterway 
infrastructure capacity and conditions, and customer requirements. The Company’s coastal and offshore tows primarily consist of one 
tugboat and one tank barge or dry-bulk cargo barge.

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Marine Transportation Industry Fundamentals

The United States inland waterway system, composed of a network of interconnected rivers and canals that serve the nation as water 
highways,  is  one  of  the  world’s  most  efficient  transportation  systems.  The  nation’s  inland  waterways  are  vital  to  the  United  States 
distribution system, with over 1.1 billion short tons of cargo moved annually on United States shallow draft waterways. The inland 
waterway  system  extends  approximately  26,000  miles,  12,000  miles  of  which  are  generally  considered  significant  for  domestic 
commerce, through 38 states, with 635 shallow draft ports. These navigable inland waterways link the United States heartland to the 
world.

The United States coastal waterway system consists of ports along the Atlantic, Gulf and Pacific coasts, as well as ports in Alaska, 
Hawaii and on the Great Lakes. Like the inland waterways, the coastal trade is vital to the United States distribution system, particularly 
the regional distribution of refined petroleum products from refineries and storage facilities to a variety of destinations, including other 
refineries, distribution terminals, power plants and ships. In addition to distribution directly from refineries and storage facilities, coastal 
tank  barges  are  used  frequently  to  distribute  products  from  pipelines.  Many  coastal  markets  receive  refined  petroleum  products 
principally from coastal tank barges. Smaller volumes of petrochemicals are distributed from Gulf Coast plants to end users whereas 
black oil, including crude oil and natural gas condensate, is distributed regionally from refineries and terminals along the United States 
coast to refineries, power plants and distribution terminals.

Based  on  cost,  safety,  and  level  of  emissions,  barge  transportation  is  often  the  most  efficient  and  safest  means  of  surface 
transportation of bulk commodities when compared to railroads and trucks. The cargo capacity of a 27,500 barrel inland tank barge is 
the equivalent of 46 railroad tank cars or 144 tractor-trailer tank trucks. A typical Company lower Mississippi River linehaul tow of 15 
barges has the carrying capacity of approximately 216 railroad tank cars plus six locomotives, or approximately 1,050 tractor-trailer 
tank trucks. The Company’s inland tank barge fleet capacity of 22.9 million barrels equates to approximately 38,300 railroad tank cars 
or approximately 120,000 tractor-trailer tank trucks. Furthermore, barging is much more energy efficient. One ton of bulk product can 
be carried 675 miles by inland barge on one gallon of fuel, compared to 472 miles by railcar or 151 miles by truck. From an emissions 
perspective, transport by rail and tractor-trailer tank trucks emit approximately 40% and 800%, respectively, more CO2 per ton mile of 
cargo transported than by inland tank barge.  In the coastal trade, the carrying capacity of a 100,000 barrel tank barge is the equivalent 
of approximately 165 railroad tank cars or approximately 525 tractor-trailer tank trucks. The Company’s coastal tank barge fleet capacity 
of  3.1  million  barrels  equates  to  approximately  5,250  railroad  tank  cars  or  approximately  16,450  tractor-trailer  tank  trucks.  Marine 
transportation generally involves less urban exposure than railroad or truck transportation and operates on a system with few crossing 
junctures and often in areas relatively remote from population centers. These factors generally help to reduce the number of waterway 
incidents.

Inland Tank Barge Industry

The Company operates within the United States inland tank barge industry, a diverse and independent mixture of approximately 30 
large integrated transportation companies and small operators, as well as captive fleets owned by refining and petrochemical companies. 
The inland tank barge industry provides marine transportation of bulk liquid cargoes for customers and, in the case of captives, for their 
own account, throughout the Mississippi River and its tributaries and on the Gulf Intracoastal Waterway. The most significant markets 
in  this  industry  include  the  transportation  of  petrochemicals,  black  oil,  refined  petroleum  products,  and  agricultural  chemicals.  The 
Company operates in each of these markets. The use of marine transportation by the petroleum and petrochemical industry is a major 
reason for the location of United States refineries and petrochemical facilities on navigable inland waterways. Texas and Louisiana 
currently account for approximately 80% of the United States production of petrochemicals. Much of the United States farm belt is 
likewise situated with access to the inland waterway system, relying on marine transportation of farm products, including agricultural 
chemicals. The Company’s principal distribution system encompasses the Gulf Intracoastal Waterway from Brownsville, Texas, to Port 
St. Joe, Florida, the Mississippi River System and the Houston Ship Channel. The Mississippi River System includes the Arkansas, 
Illinois, Missouri, Ohio, Red, Tennessee, Yazoo, Ouachita and Black Warrior Rivers and the Tennessee-Tombigbee Waterway.

The number of tank barges that operate on the inland waterways of the United States declined from an estimated 4,200 in 1982 to 
2,900  in  1993,  remained  relatively  constant  at  2,900  until  2002,  decreased  to  2,750  from  2002  through  2006,  then  increased  to 
approximately 4,000 by the end of 2019, and remained relatively flat during 2020 and 2021. The Company believes the decrease from 
4,200 in 1982 to 2,750 in 2006 primarily resulted from the increasing age of the domestic tank barge fleet, which resulted in scrapping; 
rates inadequate to justify new construction; a reduction in tax incentives, which previously encouraged speculative construction of new 
equipment;  stringent  operating  standards  to  adequately  cope  with  safety  and  environmental  risk;  the  elimination  of  government 
regulations and programs supporting the many small refineries and the proliferation of oil traders which created a strong demand for 
tank barge services; an increase in the average capacity per barge; and an increase in environmental regulations that mandate expensive 
equipment modification, which some owners were unwilling or unable to undertake given capital constraints and the age of their fleets. 
The cost of tank barge hull work for required periodic United States Coast Guard (“USCG”) certifications, as well as general safety and 
environmental concerns, force operators to periodically reassess their ability to recover maintenance costs. The increase from 2,750 tank 
barges in 2006 to approximately 4,000 by the end of 2019 primarily resulted from increased barge construction and deferred retirements 

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due to strong demand and resulting capacity shortages. The number of industry tank barges has remained relatively constant from 2019 
through the end of 2021. The Company’s 1,025 inland tank barges represent approximately 26% of the industry’s approximately 4,000 
inland tank barges.

For 2019, the Company estimated that industry-wide 150 new tank barges were placed in service and 100 tank barges were retired. 
For 2020, the Company estimated that industry-wide approximately 150 new tank barges were placed in service and 150 tank barges 
were retired.  For 2021, the Company estimated that industry-wide 70 new tank barges were placed in service and 90 tank barges were 
retired.  During 2019, the Company's inland tank barge utilization rates increased above 90% due to a favorable pricing environment 
for customers’ products, new petrochemical industry capacity that led to increased movements of petrochemicals, and higher volumes 
of crude oil moved from the Northern U.S. to the Gulf Coast.  During 2020, the Company's tank barge utilization decreased from the 
low to mid-90% range in the 2020 first quarter to the high 60% range during the 2020 fourth quarter as a result of a reduction in demand 
due to the COVID-19 pandemic.  During 2021, the Company's inland barge utilization improved to the mid-to high 80% range by the 
fourth quarter as the economy began to recover from the COVID-19 pandemic.  The Company estimates that approximately 5 to 10 new 
tank barges have currently been ordered for delivery in 2022. Generally, the risk of an oversupply of tank barges may be mitigated by 
increased  petrochemical,  black  oil  and  refined  petroleum  products  volumes  from  increased  production  from  current  facilities,  plant 
expansions, the opening of new facilities, and the fact that the inland tank barge industry has approximately 385 tank barges that are 30 
years old or older and approximately 280 of those are 40 years old or older, which could lead to retirement of these older tank barges. 
The average age of the nation’s inland tank barge fleet is approximately 15 years.

The Company’s inland marine transportation segment also owns a shifting operation and fleeting facility for dry cargo barges and 
tank barges on the Houston Ship Channel, in Freeport and Port Arthur, Texas, and Lake Charles, Louisiana, and a shipyard for building 
inland towboats and providing routine maintenance on marine vessels. The Company also owns a two-thirds interest in Osprey Line, 
L.L.C. (“Osprey”), a transporter of project cargoes and cargo containers by barge on the United States inland waterway system.

Coastal Tank Barge Industry

The Company also operates in the United States coastal tank barge industry, operating tank barges in the 195,000 barrels or less 
category. This market is composed of approximately 20 large integrated transportation companies and small operators. The 195,000 
barrels or less category coastal tank barge industry primarily provides regional marine transportation distribution of bulk liquid cargoes 
along the United States’ Atlantic, Gulf and Pacific coasts, in Alaska and Hawaii, and to a lesser extent, on the Great Lakes. Products 
transported are primarily refined petroleum products and black oil from refineries and storage facilities to a variety of destinations, 
including other refineries, distribution terminals, power plants and ships, the regional movement of crude oil and natural gas condensate 
to Gulf  Coast, Northeast  and  West Coast  refineries,  and the movement of  petrochemicals primarily  from Gulf  Coast petrochemical 
facilities to end users.

The number of coastal tank barges that operate in the 195,000 barrels or less category is approximately 270, of which the Company 
operates 31 or approximately 11%. The average age of the nation’s coastal tank barge fleet is approximately 15 years.  The Company is 
aware of one small specialized coastal articulated tank barge and tugboat unit ("ATB") that was delivered in the first quarter of 2021 
with no further coastal barges currently under construction.  The coastal tank barge fleet has approximately 20 tank barges that are over 
25 years old.  The number of older tank barges, coupled with low industry-wide barge utilization levels and ballast water treatment 
regulations, could lead to further retirements of these older tank barges in the next few years.

Competition in the Tank Barge Industry

The  tank  barge  industry  is  very  competitive.  Competition  in  this  business  is  based  on  price  and  reliability,  with  many  of  the 
industry’s customers emphasizing enhanced vetting requirements, an increased emphasis on safety, the environment, and high quality 
service consistent with the customer's operational standards.  Customers also require that their supplier of tank barge services have the 
ability  to  handle  a  variety  of  requirements,  including  distribution  capabilities  throughout  the  inland  waterway  system  and  coastal 
markets, high levels of flexibility, and an emphasis on safety, environmental and financial responsibility, as well as appropriate insurance 
coverage.

In the inland markets, the Company’s direct competitors are primarily noncaptive inland tank barge operators. “Captive” fleets are 
owned by refining and petrochemical companies which occasionally compete in the inland tank barge market, but primarily transport 
cargoes for their own account. The Company is the largest inland tank barge carrier, both in terms of number of barges and total fleet 
barrel capacity. The Company’s inland tank barge fleet has grown from 71 tank barges in 1988 to 1,025 tank barges as of December 31, 
2021, or approximately 26% of the estimated total number of domestic inland tank barges.

In the coastal markets, the Company’s direct competitors are the operators of United States tank barges in the 195,000 barrels or 
less category. Coastal tank barges in the 195,000 barrels or less category have the ability to enter the majority of coastal ports. Ocean-
going tank barges and United States product tankers in the 300,000 barrels plus category, excluding the fleet of large tankers dedicated 
to Alaska crude oil transportation, occasionally compete in the 195,000 barrels or less market to move large volumes of refined petroleum 

6

products within the Gulf of Mexico with occasional movements from the Gulf Coast to the East Coast, along the West Coast and from 
Texas and Louisiana to Florida. However, of the approximately 45 such vessels, because of their size, their access to ports is limited by 
terminal size and draft restrictions.

While the Company competes primarily with other tank barge companies, it also competes with companies who operate refined 
product and petrochemical pipelines, railroad tank cars, and tractor-trailer tank trucks. As noted above, the Company believes that both 
inland and coastal marine transportation of bulk liquid products enjoy a substantial cost advantage over railroad and truck transportation. 
The Company believes that refined product and crude oil pipelines, although often a less expensive form of transportation than inland 
and  coastal  tank  barges,  are  not  as  adaptable  to  diverse  products  and  are  generally  limited  to  fixed  point-to-point  distribution  of 
commodities in high volumes over extended periods of time.

Products Transported

The Company transports petrochemicals, black oil, refined petroleum products, and agricultural chemicals by tank barge throughout 
the Mississippi River System, on the Gulf Intracoastal Waterway, and coastwise along all three United States coasts. During 2021, the 
Company’s inland marine transportation operation moved over 47 million tons of liquid cargo on the United States inland waterway 
system.

Petrochemicals. Bulk liquid petrochemicals transported include such products as benzene, styrene, methanol, acrylonitrile, xylene, 
naphtha and caustic soda.  These products are consumed in the production of paper, fiber and plastics. Pressurized products, including 
butadiene, isobutane, propylene, butane and propane, all requiring pressurized conditions to remain in stable liquid form, are transported 
in pressure barges. The transportation of petrochemical products represented 50% of the segment’s 2021 revenues. Customers shipping 
these products are petrochemical and refining companies.

Black Oil. Black oil transported includes such products as residual fuel oil, No. 6 fuel oil, coker feedstock, vacuum gas oil, asphalt, 
carbon  black  feedstock,  crude  oil,  natural  gas  condensate  and  ship  bunkers  (engine  fuel).  Such  products  represented  26%  of  the 
segment’s 2021 revenues. Black oil customers are refining companies, marketers, and end users that require the transportation of black 
oil between refineries and storage terminals, to other refineries and to power plants. Ship bunker customers are oil companies and oil 
traders in the bunkering business.

Refined  Petroleum  Products.  Refined  petroleum  products  transported  include  the  various  blends  of  finished  gasoline,  gasoline 
blendstocks, jet fuel, No. 2 oil, heating oil and diesel fuel, and represented 20% of the segment’s 2021 revenues. The Company also 
classifies  ethanol  in  the  refined  petroleum  products  category.  Customers  are  oil  and  refining  companies,  marketers  and  ethanol 
producers.

Agricultural Chemicals. Agricultural chemicals transported represented 4% of the segment’s 2021 revenues. Agricultural chemicals 
include anhydrous ammonia and nitrogen-based liquid fertilizer, as well as industrial ammonia. Agricultural chemical customers consist 
mainly of domestic and foreign producers of such products.

Demand Drivers in the Tank Barge Industry

Demand  for  tank  barge  transportation  services  is  driven  by  the  production  volumes  of  the  bulk  liquid  commodities.  Marine 
transportation demand for the segment’s four primary commodity groups, petrochemicals, black oil, refined petroleum products and 
agricultural chemicals, is based on differing circumstances. While the demand drivers of each commodity are different, the Company 
has the flexibility, in certain cases, of reallocating inland equipment and coastal equipment among the petrochemical, refined petroleum 
products and black oil markets as needed.

Petrochemical products are used in both consumer non-durable and durable goods. Bulk petrochemical volumes have historically 
tracked the general domestic economy and correlate to the United States Gross Domestic Product.  Barge utilization ranged from the 
low  to  mid-90%  range  during  the  majority  of  2019  as  a  result  of  a  favorable  pricing  environment  for  customers’  products,  new 
petrochemical industry capacity that led to increased movements of petrochemicals, and the continued retirement of older barges from 
the segment’s fleet.  During 2020, Gulf Coast petrochemical plants saw reduced production levels as a result of lower demand due to 
the COVID-19 pandemic thereby decreasing marine transportation volumes of basic petrochemicals to both domestic consumers and 
terminals  for  export  destinations.  In  addition,  during  the  2020  third  quarter,  the  petrochemical  complex  along  the  Gulf  Coast  was 
impacted by hurricanes and tropical storms, further reducing barge volumes and closing critical waterways for extended periods of time.  
As a result, barge utilization decreased from the low to mid-90% range during the 2020 first quarter to the high 60% range in the 2020 
fourth quarter and then recovered to the mid-to high 80% range in the 2021 fourth quarter as the economy improved.  Coastal tank barge 
utilization for the transportation of petrochemicals remained steady in the mid-to-high 80% range for 2019 through 2021 due to a high 
percentage of term contracts.

7

The demand for black oil, including ship bunkers, varies by type of product transported. Demand for transportation of residual oil, 
a heavy by-product of refining operations, varies with refinery utilization and usage of feedstocks.  During 2019 through 2021, the 
Company continued to transport crude oil and natural gas condensate produced from the Eagle Ford and Permian Basin shale formations 
in Texas both along the Gulf Intracoastal Waterway with inland vessels and in the Gulf of Mexico with coastal equipment, and continued 
to transport Utica crude oil and natural gas condensate downriver from the Mid-Atlantic to the Gulf Coast, albeit, at reduced levels as 
some of the product was transported by newly constructed pipelines.  During 2020, the Company experienced a further decrease in 
volumes being transported along these routes as a result of reduced demand due to the COVID-19 pandemic and oil price volatility 
during the year.  During 2021, volumes recovered from the lows seen in 2020 as economic activity improved.  During 2019, strong 
demand for crude oil and natural gas condensate movements resulted in inland black oil tank barge utilization in the mid-to high 90% 
range.  During 2020, the COVID-19 pandemic resulted in reduced demand for crude oil and natural gas condensate movements and 
resulted in a decrease in black oil tank barge utilization from the low to mid-90% range during the 2020 first half to the mid-60% to low 
70% range during the 2020 second half.  During 2021, as economic activity improved, black oil tank barge utilization averaged in the 
mid 70% range during the first nine months of 2021 and recovered to the high 80% range in the 2021 fourth quarter.  Coastal black oil 
tank barge utilization averaged in the high 90% range in 2019 due to the retirement of coastal barges throughout the industry and declined 
slightly to the mid 90% range in 2020 and 2021 despite the reduced demand as a result of the COVID-19 pandemic as utilization was 
supported by a high percentage of term contracts.  Inland and coastal asphalt shipments are generally seasonal, with higher volumes 
shipped during April through November, months when weather allows for efficient road construction. 

Refined petroleum product volumes are driven by United States gasoline and diesel fuel consumption, principally vehicle usage, 
air travel, and weather conditions. Volumes can also be affected by gasoline inventory imbalances within the United States. Generally, 
gasoline and No. 2 oil are exported from the Gulf Coast where refining capacity exceeds demand. The Midwest is a net importer of such 
products. Volumes were also driven by diesel fuel transported to terminals along the Gulf Coast for export to South America. Ethanol, 
produced in the Midwest, is moved from the Midwest to the Gulf Coast. In the coastal trade, tank barges are frequently used regionally 
to transport refined petroleum products from a coastal refinery or terminals served by pipelines to the end markets. Many coastal areas 
rely  upon  access  to  refined  petroleum  products  by  using  marine  transportation  in  the  distribution  chain.  Coastal  refined  petroleum 
products tank barge utilization in 2019 was in the low 70% range primarily due to the retirement of out-of-service coastal barges during 
prior years and improved customer demand resulting in higher barge utilization in the spot market in 2019.  In 2020, coastal refined 
petroleum products tank barge utilization declined to the low 60% range due to the COVID-19 pandemic and the resulting reduction in 
demand  and  recovered  into  the  low  70%  range  in  the  2021  fourth  quarter  due  to  increased  business  activity  and  the  retirement  of 
underutilized equipment in the 2021 third quarter.

Demand  for  marine  transportation  of  domestic  and  imported  agricultural  fertilizer  is  seasonal  and  directly  related  to  domestic 
nitrogen-based liquid fertilizer consumption, driven by the production of corn, cotton and wheat. During periods of high natural gas 
prices, the manufacturing of nitrogen-based liquid fertilizer in the United States is curtailed. During these periods, imported products, 
which normally involve longer barge trips, replace the domestic products to meet Midwest and South Texas demands. Such products 
are delivered to the numerous small terminals and distributors throughout the United States farm belt.

Marine Transportation Operations

The marine transportation segment operated a fleet of 1,025 inland tank barges and an average of 255 inland towboats during the 
2021 fourth quarter, as well as 31 coastal tank barges and 29 coastal tugboats. The segment also operated four offshore dry-bulk cargo 
barges, four offshore tugboats and one docking tugboat transporting dry-bulk commodities in United States coastal trade.

Inland Operations. The segment’s inland operations are conducted through a wholly owned subsidiary, Kirby Inland Marine, LP 
(“Kirby Inland Marine”). Kirby Inland Marine’s operations consist of the Canal, Linehaul and River fleets, as well as barge fleeting 
services.

The Canal fleet transports petrochemical feedstocks, processed chemicals, pressurized products, black oil, and refined petroleum 
products along the Gulf Intracoastal Waterway, the Mississippi River below Baton Rouge, Louisiana, and the Houston Ship Channel. 
Petrochemical  feedstocks  and  certain  pressurized  products  are  transported  from  one  plant  to  another  plant  for  further  processing. 
Processed chemicals and certain pressurized products are moved to waterfront terminals and chemical plants. Black oil is transported to 
waterfront  terminals  and  products  such  as  No.  6  fuel  oil  are  transported  directly  to  the  end  users.  Refined  petroleum  products  are 
transported to waterfront terminals along the Gulf Intracoastal Waterway for distribution.

The Linehaul fleet transports petrochemical feedstocks, chemicals, agricultural chemicals and lube oils along the Gulf Intracoastal 
Waterway, Mississippi River and the Illinois and Ohio Rivers. Loaded tank barges are staged in the Baton Rouge area from Gulf Coast 
refineries  and  petrochemical  plants,  and  are  transported  from  Baton  Rouge,  Louisiana  to  waterfront  terminals  and  plants  on  the 
Mississippi, Illinois and Ohio Rivers, and along the Gulf Intracoastal Waterway, on regularly scheduled linehaul tows.  Tank barges are 
dropped off and picked up going up and down river.

8

The River fleet transports petrochemical feedstocks, chemicals, refined petroleum products, agricultural chemicals and black oil 
along the Mississippi River System above Baton Rouge. The River fleet operates unit tows, where a towboat and generally a dedicated 
group  of  barges  operate  on  consecutive  voyages  between  loading  and  discharge  points.  Petrochemical  feedstocks  and  processed 
chemicals are transported to waterfront petrochemical and chemical plants, while black oil, refined petroleum products and agricultural 
chemicals are transported to waterfront terminals.

The inland transportation of petrochemical feedstocks, chemicals and pressurized products is generally consistent throughout the 
year. Transportation of refined petroleum products, certain black oil and agricultural chemicals is generally more seasonal. Movements 
of black oil, such as asphalt, generally increase in the spring through fall months. Movements of refined petroleum products, such as 
gasoline blends, generally increase during the summer driving season, while heating oil movements generally increase during the winter 
months. Movements of agricultural chemicals generally increase during the spring and fall planting seasons.

The  marine  transportation  inland  operation  moves  and  handles  a  broad  range  of  sophisticated  cargoes.  To  meet  the  specific 
requirements of the cargoes transported, the inland tank barges may be equipped with self-contained heating systems, high-capacity 
pumps, pressurized tanks, refrigeration units, stainless steel tanks, aluminum tanks or specialty coated tanks. Of the 1,025 inland tank 
barges currently operated, 787 are petrochemical and refined petroleum products barges, 153 are black oil barges, 75 are pressure barges 
and 10 are refrigerated anhydrous ammonia barges. Of the 1,025 inland tank barges, 983 are owned by the Company and 42 are leased.

The fleet of 255 inland towboats for the 2021 fourth quarter ranges from 800 to 6,100 horsepower. Of the 255 inland towboats, 211 
are owned by the Company and 44 are chartered. Towboats in the 800 to 2,100 horsepower classes provide power for barges used by 
the  Canal  and  Linehaul  fleets  on  the  Gulf  Intracoastal  Waterway  and  the  Houston  Ship  Channel.  Towboats  in  the  1,400  to  3,200 
horsepower classes provide power for both the River and Linehaul fleets on the Gulf Intracoastal Waterway and the Mississippi River 
System. Towboats above 3,600 horsepower are typically used on the Mississippi River System to move River fleet unit tows and provide 
Linehaul fleet towing. Based on the capabilities of the individual towboats used in the Mississippi River System, the tows range in size 
from 10,000 to 30,000 tons.

Marine transportation services for inland movements are conducted under term contracts, which have contract terms of 12 months 
or longer, or spot contracts, which have contract terms of less than 12 months, with customers with whom the Company has traditionally 
had long-standing relationships. Typically, term contracts range from one to three years, some of which have renewal options.  During 
2019,  2020,  and  2021  approximately  65%  of  inland  marine  transportation  revenues  were  under  term  contracts  and  35%  were  spot 
contract revenues.

All of the Company’s inland tank barges used in the transportation of bulk liquid products are of double hull construction and are 
capable of controlling vapor emissions during loading and discharging operations in compliance with occupational safety and health 
regulations and air quality regulations.

The Company has the ability to offer its customers optimized distribution capabilities throughout the Mississippi River System and 
the  Gulf  Intracoastal  Waterway.  Such  capabilities  offer  economies  of  scale  from  matching  tank  barges,  towboats,  products,  and 
destinations efficiently to meet its customers’ requirements.

Through the Company’s proprietary vessel management computer system, the Company’s barge and towboat fleet is dispatched 
from a centralized dispatch group. The towboats are equipped with cellular and satellite positioning and communication systems that 
automatically transmit the location of the towboat to the Company’s customer service department. Electronic orders are communicated 
to vessel personnel with reports of towing activities fed back electronically to the customer service department. The electronic interface 
between the customer service department and the vessel enables matching of customer needs to barge capabilities, thereby promoting 
efficient  utilization  of  the  tank  barge  and  towboat  fleet.  The  Company’s  customers  are  able  to  access  information  concerning  the 
movement of their cargoes, including barge locations, through the Company’s proprietary electronic customer service portal.

Kirby  Inland  Marine  operates  the  largest  commercial  tank  barge  fleeting  service  (barge  storage  facilities)  in  numerous  ports, 
including  Houston,  Corpus  Christi,  Freeport  and  Orange,  Texas,  Baton  Rouge,  Lake  Charles  and  New  Orleans,  Louisiana,  Mobile, 
Alabama, and Greenville, Mississippi. Included in the fleeting service is a shifting operation and fleeting service for dry cargo barges 
and tank barges on the Houston Ship Channel, in Freeport and Port Arthur, Texas, and Lake Charles, Louisiana. Kirby Inland Marine 
provides shifting and fleeting service for its own barges, as well as for customers and third party carriers, transferring barges within the 
areas noted.

Kirby Inland Marine also provides shore-based barge tankermen to the Company and third parties. Services to the Company and 

third parties cover the Gulf Coast, mid-Mississippi Valley, and the Ohio River Valley.

San Jac Marine, LLC (“San Jac”), a subsidiary of Kirby Inland Marine, owns and operates a shipyard in Channelview, Texas which 
builds marine vessels for both inland and coastal applications, and provide maintenance and repair services. Kirby Inland Marine also 
builds inland towboats and performs routine maintenance and repairs at the shipyard.

9

The Company owns a two-thirds interest in Osprey, which transports project cargoes and cargo containers by barge on the United 

States inland waterway system.

Coastal Operations. The segment’s coastal operations are conducted through wholly owned subsidiaries, Kirby Offshore Marine, 

LLC (“Kirby Offshore Marine”) and Kirby Ocean Transport Company (“Kirby Ocean Transport”).

Kirby Offshore Marine provides marine transportation of refined petroleum products, petrochemicals and black oil in coastal regions 

of the United States. The coastal operations consist of the Atlantic and Pacific Divisions.

The Atlantic Division primarily operates along the eastern seaboard of the United States and along the Gulf Coast. The Atlantic 
Division vessels call on various coastal ports from Maine to Texas, servicing refineries, storage terminals and power plants. The Atlantic 
Division  also  operates  equipment,  to  a  lesser  extent,  in  the  Eastern  Canadian  provinces.  The  tank  barges  operating  in  the  Atlantic 
Division are in the 10,000 to 194,000 barrels capacity range and coastal tugboats in the 2,400 to 10,000 horsepower range, transporting 
primarily refined petroleum products, petrochemicals and black oil.

The Pacific Division primarily operates along the Pacific Coast of the United States, servicing refineries and storage terminals from 
Southern California to Washington State.  The Pacific Division’s fleet consists of tank barges in the 52,000 to 193,000 barrels capacity 
range and tugboats in the 3,700 to 11,000 horsepower range, transporting primarily refined petroleum products.

The coastal transportation of refined petroleum products and black oil is impacted by seasonality and is partially dependent on the 
area of operations. Operations along the West Coast of the United States have been subject to more seasonal variations in demand than 
the operations along the East Coast and Gulf Coast regions of the United States.  Movements of refined petroleum products such as 
various blends of gasoline are strongest during the summer driving season while heating oil generally increases during the winter months.

The coastal fleet consists of 31 tank barges with 3.1 million barrels of capacity, primarily transporting refined petroleum products, 
black oil and petrochemicals. The Company owns 30 of the coastal tank barges and leases one barge. Of the 31 coastal tank barges, 22 
are refined petroleum products and petrochemical barges and 9 are black oil barges. The Company operates 29 coastal tugboats ranging 
from 2,400 to 11,000 horsepower, of which 26 are owned by the Company and three are chartered.

Coastal marine transportation services are conducted under long-term contracts, primarily one year or longer, some of which have 
renewal options, for customers with which the Company has traditionally had long-standing relationships. During and 2021 and 2019, 
approximately  80%  of  the  coastal  marine  transportation  revenues  were  under  term  contracts  and  20%  were  spot  contract  revenues.  
During 2020, approximately 85% of the coastal marine transportation revenues were under term contracts and 15% were spot contract 
revenues.

Kirby Offshore Marine also operates a fleet of two offshore dry-bulk barge and tugboat units involved in the transportation of sugar 
and other dry products between Florida and East Coast ports. These vessels primarily operate under long-term contracts of affreightment.

Kirby Ocean Transport owns and operates a fleet of two offshore dry-bulk barges, two offshore tugboats and one docking tugboat. 
Kirby Ocean Transport operates primarily under term contracts of affreightment, including a contract that expires in 2022 with Duke 
Energy Florida (“DEF”) to transport coal across the Gulf of Mexico to DEF’s power generation facility at Crystal River, Florida.

Kirby Ocean Transport is also engaged in the transportation of coal, fertilizer, sugar and other bulk cargoes on a short-term basis 

between domestic ports and occasionally the transportation of grain from domestic ports to ports primarily in the Caribbean Basin.

Contracts and Customers

Marine transportation inland and coastal services are conducted under term or spot contracts for customers with whom the Company 
has traditionally had long-standing relationships. Typically, term contracts range from one to three years, some of which have renewal 
options. The majority of the marine transportation contracts with its customers are for terms of one year. Most have been customers of 
the Company’s marine transportation segment for many years and management anticipates continued relationships; however, there is 
no assurance that any individual contract will be renewed.

A term contract is an agreement with a specific customer to transport cargo from a designated origin to a designated destination at 
a set rate (affreightment) or at a daily rate (time charter). The rate may or may not include escalation provisions to recover changes in 
specific costs such as fuel. Time charters, which insulate the Company from revenue fluctuations caused by weather and navigational 
delays  and  temporary  market  declines,  represented  approximately  58%  of  the  marine  transportation’s  inland  revenues  under  term 
contracts during 2021, 66% of revenue under term contracts during 2020 and 62% of the revenue under term contracts during 2019. A 
spot contract is an agreement with a customer to move cargo from a specific origin to a designated destination for a rate negotiated at 
the time the cargo movement takes place. Spot contract rates are at the current “market” rate and are subject to market volatility. The 
Company typically maintains a higher mix of term contracts to spot contracts to provide the Company with a reasonably predictable 

10

revenue stream while maintaining spot market exposure to take advantage of new business opportunities and customers’ peak demands. 
During 2021, 2020, and 2019, approximately 65% of inland marine transportation revenues were under term contracts and 35% were 
spot contract revenues. Coastal time charters represented approximately 85% of the marine transportation’s coastal revenues under term 
contracts in 2021 and 2019, and approximately 90% of coastal revenues under term contracts in 2020.

No single customer of the marine transportation segment accounted for 10% or more of the Company’s revenues in 2021, 2020, or 

2019.

Properties

The principal offices of Kirby Inland Marine, Kirby Offshore Marine, Kirby Ocean Transport and Osprey are located in Houston, 
Texas, in two facilities under leases that expire in December 2025 and December 2027. Kirby Inland Marine’s operating locations are 
on the Mississippi River at Baton Rouge and New Orleans, Louisiana, and Greenville, Mississippi, three locations in Houston, Texas, 
on or near the Houston Ship Channel, one in Miami, Florida, one in Gibson, Louisiana, one in Lake Charles, Louisiana, several properties 
in Westwego, Louisiana, one in Corpus Christi, Texas, and two in Orange, Texas. The New Orleans, Gibson, Westwego, Houston, and 
Orange operating facilities are owned by the Company, and the Baton Rouge, Corpus Christi, Lake Charles, Greenville, and Miami 
facilities are leased. Kirby Offshore Marine’s operating facilities are located in Staten Island, New York, and Seattle, Washington. All 
of Kirby Offshore Marine’s operating facilities are leased, including piers and wharf facilities and office and warehouse space. San Jac’s 
operating location is near the Houston Ship Channel and is owned by the Company.

Governmental Regulations

General. The Company’s marine transportation operations are subject to regulation by the USCG, federal laws, state laws, the laws 
of other countries when operating in their waters, and certain international conventions.  The agencies establish safety requirements and 
standards and are authorized to investigate incidents.

Most of the Company’s tank barges are inspected by the USCG and carry certificates of inspection. The Company’s inland and 
coastal towing vessels and coastal dry-bulk barges are also subject to USCG regulations. The USCG has enacted safety regulations 
governing  the  inspection,  standards,  and  safety  management  systems  of  towing  vessels.  The  regulations  also  create  many  new 
requirements for design, construction, equipment, and operation of towing vessels. The USCG regulations supersede the jurisdiction of 
the United States Occupational Safety and Health Administration (“OSHA”) and any state regulations on vessel design, construction, 
alteration, repair, maintenance, operation, equipping, personnel qualifications and manning. The regulations requiring towing vessels to 
obtain a certificate of inspection became effective for existing towing vessels on July 20, 2018. Other portions of the regulations are 
phased in following the July 20, 2018 effective date through July 19, 2022, by which time the Company expects to be in full compliance.

All of the Company’s coastal tugboats and coastal tank and dry-bulk barges are built to American Bureau of Shipping (“ABS”) 
classification standards and/or statutory requirements issued by the USCG, and are inspected periodically by ABS and/or the USCG to 
maintain the vessels in class and compliant with all U.S. statutory requirements, as applicable to the vessel. The crews employed by the 
Company aboard inland and coastal vessels, including captains, pilots, engineers, tankermen and ordinary seamen, are licensed by the 
USCG.

The Company is required by various governmental agencies to obtain licenses, certificates and permits for its vessels depending 
upon such factors as the cargo transported, the waters in which the vessels operate and other factors. The Company believes that its 
vessels have obtained and can maintain all required licenses, certificates and permits required by such governmental agencies for the 
foreseeable future. The Company’s failure to maintain these authorizations could adversely impact its operations.

The Company believes that additional security and environmental related regulations relating to contingency planning requirements 
could be imposed on the marine industry. Generally, the Company endorses the anticipated additional regulations and believes it is 
currently operating to standards at least equal to anticipated additional regulations.

Jones Act. The Jones Act is a federal cabotage law that restricts domestic marine transportation in the United States to vessels built 
and registered in the United States and manned, owned and operated by United States citizens. For a corporation to qualify as a United 
States citizen for the purpose of domestic trade, it has to be 75% owned and controlled by United States citizens within the meaning of 
the Jones Act. The Company monitors its citizenship status and meets the requirements of the Jones Act for its owned and operated 
vessels.

Compliance with United States ownership requirements of the Jones Act is important to the operations of the Company, and a 
violation  of  the  Jones  Act  could  have  a  material  negative  effect  on  the  Company  and  its  vessels’  ability  to  operate.  The  Company 
monitors the citizenship of its employees and stockholders and complies with United States build requirements.

11

User Taxes. Federal legislation requires that inland marine transportation companies pay a user tax based on propulsion fuel used 
by vessels engaged in trade along the inland waterways that are maintained by the United States Army Corps of Engineers. Such user 
taxes are designed to help defray the costs associated with replacing major components of the inland waterway system, such as locks 
and dams. A significant portion of the inland waterways on which the Company’s vessels operate is maintained by the Army Corps of 
Engineers.

The Company presently pays a federal fuel user tax of 29.1 cents per gallon consisting of a 0.1 cent per gallon leaking underground 

storage tank tax and 29 cents per gallon waterways user tax.

Security Requirements. The Maritime Transportation Security Act of 2002 requires, among other things, submission to and approval 
by the USCG of vessel and waterfront facility security plans (“VSP” and “FSP”, respectively). The Company maintains approved VSP 
and FSP and is operating in compliance with the plans for all of its vessels and facilities that are subject to the requirements.

Environmental Regulations

The Company’s operations are affected by various regulations and legislation enacted for protection of the environment by the 
United  States  government,  as  well  as  many  coastal  and  inland  waterway  states  and  international  jurisdictions  to  the  extent  that  the 
Company’s  vessels  transit  in  international  waters.  Government  regulations  require  the  Company  to  obtain  permits,  licenses  and 
certificates for the operation of its vessels. Failure to maintain necessary permits or approvals could require the Company to incur costs 
or temporarily suspend operation of one or more of its vessels. Violations of these laws may result in civil and criminal penalties, fines, 
or other sanctions.

Water Pollution Regulations. The Federal Water Pollution Control Act of 1972, as amended by the Clean Water Act of 1977 (“Clean 
Water Act”), the Comprehensive Environmental Response, Compensation and Liability Act of 1981 (“CERCLA”) and the Oil Pollution 
Act of 1990 (“OPA”) impose strict prohibitions against the discharge of oil and its derivatives or hazardous substances into the navigable 
waters of the United States. These acts impose civil and criminal penalties for any prohibited discharges and impose substantial strict 
liability  for  cleanup  of  these  discharges  and  any  associated  damages.  Certain  states  also  have  water  pollution  laws  that  prohibit 
discharges into waters that traverse the state or adjoin the state, and impose civil and criminal penalties and liabilities similar in nature 
to those imposed under federal laws.

The OPA and various state laws of similar intent substantially increased over historic levels the statutory liability of owners and 

operators of vessels for oil spills, both in terms of limit of liability and scope of damages.

The  Company  manages  its  exposure  to  losses  from  potential  discharges  of  pollutants  through  the  use  of  well-maintained  and 
equipped vessels, through safety, training and environmental programs, and through the Company’s insurance program. There can be 
no assurance, however, that any new regulations or requirements or any discharge of pollutants by the Company will not have an adverse 
effect on the Company.

Clean Water Act. The Clean Water Act establishes the National Pollutant Discharge Elimination System (“NPDES”) permitting 
program which regulates discharges into navigable waters of the United States. The United States Environmental Protection Agency 
(“EPA”) regulates the discharge of ballast water and other substances in United States waters under the Clean Water Act. Pursuant to 
the NPDES program, effective February 6, 2009, the EPA issued regulations requiring vessels 79 feet in length or longer to comply with 
a Vessel General Permit authorizing ballast water discharges and other discharges incidental to the operation of the vessels. The EPA 
regulations  also imposed technology and  water  quality  based  effluent  limits  for certain  types of  discharges  and established specific 
inspection,  monitoring,  recordkeeping  and  reporting  requirements  for  vessels  to  ensure  effluent  limitations  are  met.  The  Vessel 
Incidental Discharge Act (“VIDA”), signed into law on December 4, 2018, established a new framework for the regulation of vessel 
incidental discharges under the Clean Water Act. VIDA requires the EPA to develop national performance standards for those discharges 
within two years of enactment and requires the USCG to develop implementation, compliance, and enforcement regulations within two 
years  of  the  EPA’s  promulgation  of  standards.  Under  VIDA,  all  provisions  of  the  Vessel  General  Permit  which  became  effective 
December 19, 2013, remain in force and effect until the USCG regulations are finalized. The Company maintains Vessel General Permits 
and has established recordkeeping and reporting procedures in compliance with the EPA’s interim requirements.

The  USCG  adopted  regulations  on  ballast  water  management  treatment  systems  establishing  a  standard  for  the  allowable 
concentration of living organisms in certain vessel ballast water discharged in waters of the United States under the National Invasive 
Species Act. The regulations include requirements for the installation of engineering equipment to treat ballast water by establishing an 
approval process for ballast water management systems (“BWMS”). The BWMS implementation was suspended until December 2016 
at which time the USCG approved manufacturers’ systems that met the regulatory discharge standard equivalent to the International 
Maritime  Organization’s  D-2  standard.  The  phase-in  schedule  for  those  existing  vessels  requiring  a  system  to  install  a  BWMS  is 
dependent on vessel build date, ballast water capacity, and drydock schedule. Compliance with the ballast water treatment regulations 
requires the installation of equipment on some of the Company’s vessels to treat ballast water before it is discharged. The installation 

12

of BWMS equipment will require significant capital expenditures at the next scheduled drydocking to complete the installation of the 
approved system on those existing vessels that require a system in order to comply with the BWMS regulations.

Financial Responsibility Requirement. Commencing with the Federal Water Pollution Control Act of 1972, as amended, vessels 
over 300 gross tons operating in the Exclusive Economic Zone of the United States have been required to maintain evidence of financial 
ability to satisfy statutory liabilities for oil and hazardous substance water pollution. This evidence is in the form of a Certificate of 
Financial  Responsibility  (“COFR”)  issued  by  the  USCG.  The  majority  of  the  Company’s  tank  barges  are  subject  to  this  COFR 
requirement, and the Company has fully complied with this requirement since its inception. The Company does not foresee any current 
or future difficulty in maintaining the COFR certificates under current rules.

Clean Air Regulations. The Federal Clean Air Act of 1979 (“CAA”) requires states to draft State Implementation Plans (“SIPs”) 
under the National Ambient Air Quality Standards designed to reduce atmospheric pollution for six common air pollutants to levels 
mandated by this act. The EPA designates areas in the United States as meeting or not meeting the standards.  Several SIPs implement 
the  regulation  of  barge  loading  and  discharging  emissions  at  waterfront  facilities  as  a  measure  to  meet  the  CAA  standard.  The 
implementation of these regulations requires a reduction of hydrocarbon emissions released into the atmosphere during the loading of 
most petroleum products and the degassing and cleaning of barges for maintenance or change of cargo. These regulations require vessel 
operators that operate in states with areas of nonattainment of air quality standards under the CAA to install vapor control equipment on 
their barges. The Company expects that future emission regulations will be developed and will apply this same technology to many 
chemicals that are handled by barge. Most of the Company’s barges engaged in the transportation of petrochemicals, chemicals and 
refined petroleum products are already equipped with vapor control systems. Although a risk exists that new regulations could require 
significant capital expenditures by the Company and otherwise increase the Company’s costs, the Company believes that, based upon 
the regulations that have been proposed thus far, no material capital expenditures beyond those currently contemplated by the Company 
and no material increase in costs are likely to be required.

Contingency Plan Requirement. The OPA and several state statutes of similar intent require the majority of the vessels and terminals 
operated by the Company to maintain approved oil spill contingency plans as a condition of operation. The Company has approved 
plans that comply with these requirements. The OPA also requires development of regulations for hazardous substance spill contingency 
plans. The USCG has not yet promulgated these regulations; however, the Company anticipates that they will not be more difficult to 
comply with than the oil spill plans.

Occupational  Health  Regulations.  The  Company’s  inspected  vessel  operations  are  primarily  regulated  by  the  USCG  for 
occupational  health  standards.  Uninspected  vessel  operations  and  the  Company’s  shore-based  personnel  are  subject  to  OSHA 
regulations. The Company believes that it is in compliance with the provisions of the regulations that have been adopted and does not 
believe that the adoption of any further regulations will impose additional material requirements on the Company. There can be no 
assurance, however, that claims will not be made against the Company for work related illness or injury, or that the further adoption of 
health regulations will not adversely affect the Company.

Insurance. The Company’s marine transportation operations are subject to the hazards associated with operating vessels carrying 
large volumes of bulk cargo in a marine environment. These hazards include the risk of loss of or damage to the Company’s vessels, 
damage to third parties as a result of collision, fire or explosion, adverse weather conditions, loss or contamination of cargo, personal 
injury of employees and third parties, and pollution and other environmental damages. The Company maintains hull, liability, general 
liability, workers compensation and pollution liability insurance coverage against these hazards. For shipyard operations, the Company 
has ship repairer’s liability and builder’s risk insurance. The Company uses a Texas domiciled wholly owned insurance subsidiary, 
Adaptive  KRM,  LLC,  to  provide  cost  effective  risk  transfer  options  to  insure  certain  exposures  of  the  Company  and  certain  of  its 
subsidiaries  in  its  marine  transportation  and  distribution  and  services  segments.    The  Company  also  maintains  insurance  in  the 
commercial insurance market to address liabilities arising in connection with its distribution and services segment.

Environmental Protection. The Company utilizes several programs to further its commitment to environmental responsibility in its 
operations.  Environmental compliance audits, performed with internal and external resources, are performed regularly on the Company's 
operations.  Additionally, the Company employs third party expertise to conduct safety performance, safety management system, and 
environmental audits on its barge cleaning and shipyard vendors.  The Company participates in the American Waterways Operators 
Responsible Carrier program, which drives continuous improvement towards reducing the barge industry’s impact on the environment.  
It is also a member of the Blue Sky Maritime Coalition and other organizations focused on reducing greenhouse gas emissions.

Safety.  The  Company  manages  its  exposure  to  the  hazards  associated  with  its  business  through  safety,  training  and  preventive 
maintenance efforts. The Company emphasizes its safety commitment through programs oriented toward extensive monitoring of safety 
performance  for  the  purpose  of  identifying  trends  and  initiating  corrective  action,  and  for  continuously  improving  employee  safety 
behavior and performance.

13

Training. The Company believes that among the major elements of a successful and productive work force are effective training 
programs. The Company also believes that training in the proper performance of a job enhances both the safety and quality of the service 
provided. New technology, regulatory compliance, personnel safety, quality and environmental concerns create additional demands for 
training. Refer to Human Capital below for further discussion regarding training programs the Company has developed and instituted.

Quality. Kirby Inland Marine has made a substantial commitment to the implementation, maintenance, and improvement of quality 
assurance systems. Kirby Offshore Marine is certified under ABS ISM standards. These Quality Assurance Systems and certification 
have enabled both shore and vessel personnel to effectively manage the changes which occur in the working environment, as well as 
enhancing the Company’s safety and environmental performance.

DISTRIBUTION AND SERVICES

The Company, through its wholly owned subsidiary Kirby Distribution & Services, Inc. and its wholly owned subsidiaries Kirby 
Engine Systems LLC, (“Kirby Engine Systems”), Stewart & Stevenson LLC (“S&S”), United Holdings LLC (“United”), and Diesel 
Dash  LLC  and  through  Kirby  Engine  Systems’  wholly  owned  subsidiaries  Marine  Systems,  Inc.  (“Marine  Systems”)  and  Engine 
Systems,  Inc.  (“Engine  Systems”),  serves  two  markets,  commercial  and  industrial,  and  oil  and  gas.  The  Company  sells  genuine 
replacement parts, provides service mechanics to overhaul and repair engines, transmissions, reduction gears and related oilfield service 
equipment, rebuilds component parts or entire diesel engines, transmissions and reduction gears, electrical motors, drives, and controls, 
specialized electrical distribution and control systems, energy storage battery systems, and related equipment used in oilfield services, 
marine, power generation, on-highway, and other commercial and industrial applications. Customers are served through a network of 
62 branch locations across 17 states and Colombia, South America, as well as a proprietary on-line marketplace, www.dieseldash.com. 
The Company manufactures and remanufactures oilfield service equipment, including pressure pumping units, for North American as 
well as for international oilfield service companies, and oil and gas operator and producer markets. The Company also sells engines, 
transmissions, power generation systems, and rents equipment including generators, industrial compressors, high capacity lift trucks, 
and refrigeration trailers for use in a variety of commercial and industrial applications.

For the commercial and industrial market, the Company sells Original Equipment Manufacturers (“OEM”) replacement parts and 
new diesel engines, provides service mechanics and maintains facilities to overhaul and repair diesel engines and ancillary products for 
marine and on-highway transportation companies, and industrial companies. The Company provides engineering and field services, 
OEM replacement parts and safety-related products to power generation operators and to the nuclear industry, manufactures engine 
generator  and  pump  packages  for  power  generation  operators  and  municipalities,  offers  power  generation  systems  customized  for 
specific commercial and industrial applications, and rents equipment including generators, industrial compressors, high capacity lift 
trucks, and refrigeration trailers for use in a variety of industrial markets.

For the oil and gas market, the Company sells OEM replacement parts, sells and services diesel engines, pumps and transmissions, 
manufactures and remanufactures pressure pumping units, manufactures cementing and pumping equipment, as well as coil tubing and 
well intervention equipment, electric power generation equipment, specialized electrical distribution and control equipment, and high 
capacity energy storage/battery systems. Customers include oilfield service companies, and oil and gas operators and producers.

No single customer of the distribution and services segment accounted for 10% or more of the Company’s revenues in 2021, 2020, 
or 2019. The distribution and services segment also provides service to the Company’s marine transportation segment, which accounted 
for approximately 2% of the distribution and services segment’s 2021 revenues, 3% of the segment’s 2020 revenue, and 2% of the 
segment's 2019 revenues. Such revenues are eliminated in consolidation and not included in the table below.

The following table sets forth the revenues for the distribution and services segment (dollars in thousands):

Service and parts
Manufacturing

Year Ended December 31,

2021
813,875
109,867
923,742

$

$

%

88% $
12
100% $

2020
711,051
56,092
767,143

%

93% $
7

2019
939,246
312,071
100% $ 1,251,317

%

75%
25
100%

Commercial and Industrial Operations

The  Company  serves  the  marine,  on-highway,  power  generation,  and  other  commercial  and  industrial  markets  primarily  in  the 

United States. The commercial and industrial operations represented approximately 63% of the segment’s 2021 revenues.

The Company is engaged in the overhaul and repair of medium-speed and high-speed marine diesel engines and reduction gears, 
line boring, block welding services and related parts sales for customers in the marine industry. Medium-speed diesel engines have an 
engine speed of 400 to 1,000 revolutions per minute (“RPM”) with a horsepower range of 800 to 32,000. High-speed diesel engines 
have an engine speed of over 1,000 RPM and a horsepower range of 50 to 8,375. The Company services medium-speed and high-speed 

14

 
diesel engines utilized in the inland and offshore barge industries. It also services marine equipment and offshore drilling equipment 
used in the offshore petroleum exploration and oilfield service industry, marine equipment used in the offshore commercial fishing 
industry, harbor docking vessels, commercial ferries, vessels owned by the United States government and large pleasure crafts.

The Company has marine repair operations throughout the United States providing in-house and in-field repair capabilities and 
related parts sales. The Company’s emphasis is on service to its customers, and it sends its crews from any of its locations to service 
customers’  equipment  anywhere  in  the  world.  The  medium-speed  operations  are  located  in  Houma,  Louisiana,  Houston,  Texas, 
Chesapeake, Virginia, Paducah, Kentucky, Seattle, Washington, and Tampa, Florida, serving as the authorized distributor for EMD 
Power Products (“EMD”) throughout the United States. The Company is also a distributor and representative for certain Alfa Laval 
products in the Midwest and on the East Coast, Gulf Coast, and West Coast. All of the marine locations are authorized distributors for 
Falk Corporation reduction gears and Oil States Industries, Inc. clutches. The Chesapeake, Virginia operation concentrates on East Coast 
inland  and  offshore  dry-bulk,  tank  barge  and  harbor  docking  operators,  and  the  United  States  government.  The  Houma,  Louisiana 
operation concentrates on the inland and offshore barge and oilfield services industries. The Tampa, Florida operation concentrates on 
Gulf  of  Mexico  offshore  dry-bulk,  tank  barge  and  harbor  docking  operators.  The  Paducah,  Kentucky  operation  concentrates  on  the 
inland river towboat and barge operators and the Great Lakes carriers. The Seattle, Washington operation concentrates on the offshore 
commercial fishing industry, the offshore barge industry, the United States government, and other customers in Alaska, Hawaii and the 
Pacific Rim.

The high-speed marine operations are located in Houston, Texas, Houma, Baton Rouge, Belle Chasse and New Iberia, Louisiana, 
Paducah, Kentucky, Mobile, Alabama, Lodi and Thorofare, New Jersey, and 10 locations in Florida. The Company serves as a factory-
authorized marine dealer for Caterpillar diesel engines in multiple states. The Company also operates factory-authorized full service 
marine distributorships/dealerships for Cummins, Detroit Diesel, John Deere, MTU, and Volvo Penta, and Kohler diesel engines, as 
well as Falk, Lufkin and Twin Disc marine gears. High-speed diesel engines provide the main propulsion for a significant amount of 
the United States flagged commercial vessels and large pleasure craft vessels, other marine applications, including engines for power 
generators and barge pumps.

The Company distributes, sells parts for and services diesel engines and transmissions for on-highway use and provides in-house 
and in-field service capabilities. The Company is the largest on-highway distributor for Allison Transmission and Detroit Diesel/Daimler 
Truck North America, providing parts, service and warranty on engines, transmissions and related equipment in Arkansas, Colorado, 
Florida, Louisiana, New Mexico, New York, Oklahoma, Texas, Wyoming, and the country of Colombia. The Company also provides 
similar service for off-highway use and additionally has distributor rights for Deutz and Isuzu diesel engines. Off-highway applications 
are  primarily  surface  and  underground  mining  equipment,  including  loaders,  crawlers,  crushers,  power  screens,  pumps,  cranes, 
generators, and haul trucks, as well as equipment rental.

The Company is engaged in the overhaul and repair of diesel engines and generators, and related parts sales for power generation 
customers.  The  Company  is  also  engaged  in  the  sale  and  distribution  of  diesel  engine  parts,  engine  modifications,  generator 
modifications, controls, governors and diesel generator packages to the nuclear industry. The Company services users of diesel engines 
that  provide  emergency  standby,  peak  and  base  load  power  generation.  The  Company  also  sells  power  generation  systems  that  are 
customized for specific applications and the rental of power generation systems.

The Company has power generation operations throughout the United States providing in-house and in-field repair capabilities and 
products for power generation applications. Through its Rocky Mount, North Carolina operation, the Company serves as the exclusive 
worldwide distributor of EMD products to the nuclear industry, the worldwide distributor for Woodward, Inc. products to the nuclear 
industry, the worldwide distributor of Cooper Machinery Services (“Cooper”) products to the nuclear industry, and owns the assets and 
technology necessary to support the Nordberg medium-speed diesel engines used in nuclear applications. In addition, the Rocky Mount 
operation is an exclusive distributor for Norlake Manufacturing Company transformer products to the nuclear industry, an exclusive 
distributor of Hannon Company generator and motor products to the nuclear industry, and a non-exclusive distributor of analog Weschler 
Instruments metering products and an exclusive distributor of digital Weschler metering products to the nuclear industry. The Company 
is also a non-exclusive distributor of Ingersoll Rand air start equipment to the nuclear industry worldwide.

The  Company  sells  pre-packaged  and  fabricated  power  generation  systems  for  emergency,  standby  and  auxiliary  power  for 
commercial and industrial applications. The Company also offers rental generator systems from 50 to 2,000 kilowatts of power to a 
broad range of customers. The Company also is engaged in the rental of industrial compressors, high capacity lift trucks, and refrigeration 
trailers. In addition, the Company provides accessory products such as cables, hoses, fuel cells, air dryers, air compressor boosters and 
ground  heaters.  Lastly,  the  Company  is  a  dealer  for  Thermo  King  refrigeration  systems  for  trucks,  railroad  cars  and  other  land 
transportation markets in Texas and Colorado.

15

Commercial and Industrial Customers

The results of the distribution and services industry are largely tied to the industries it serves and, therefore, are influenced by the 
cycles  of  such  industries.    The  Company’s  major  marine  customers  include  inland  and  offshore  barge  operators,  oilfield  service 
companies, offshore fishing companies, other marine transportation entities, the United States government and large pleasure crafts. 
Since the marine business is linked to the relative health of the inland towboat, offshore and coastal tugboat, harbor docking tugboat, 
offshore oilfield service, oil and gas drilling, offshore commercial fishing industries, Great Lakes ore vessels, dredging vessels, coastal 
ferries, United States government vessels and the pleasure craft industry, there is no assurance that its present gross revenues can be 
maintained in the future. 

The Company’s on-highway customers are long-haul and short-haul trucking companies, commercial and industrial companies with 
truck fleets, buses owned by municipalities and private companies. Off-highway companies include surface and underground mining 
operations with a large variety of equipment.

The  Company’s  power  generation  customers  are  domestic  utilities  and  the  worldwide  nuclear  power  industry,  municipalities, 
universities, medical facilities, data centers, petrochemical plants, manufacturing facilities, shopping malls, office complexes, residential 
and other industrial users.

The Company’s rental customers are primarily commercial and industrial companies, and residential customers with short-term 

rental requirements.

Commercial and Industrial Competitive Conditions

The  Company’s  primary  marine  competitors  are  independent  distribution  and  services  companies  and  other  factory-authorized 
distributors, authorized service centers and authorized marine dealers. Certain operators of diesel powered marine equipment also elect 
to maintain in-house service capabilities. While price is a major determinant in the competitive process, reputation, consistent quality, 
expeditious service, experienced personnel, access to parts inventories and market presence are also significant factors. A substantial 
portion of the Company’s business is obtained by competitive bids. However, the Company has entered into service agreements with 
certain operators of diesel powered marine equipment, providing such operators with one source of support and service for all of their 
requirements at pre-negotiated prices.

The Company is one of a limited number of authorized resellers of EMD, Caterpillar, Cummins, Detroit Diesel, John Deere, MTU 
and Volvo Penta parts. The Company is also the marine distributor for Falk, Lufkin and Twin Disc reduction gears throughout the United 
States.

The Company’s primary power generation competitors are other independent diesel service companies and manufacturers. While 
price is a major determinant in the competitive process, reputation, consistent quality, expeditious service, experienced personnel, access 
to parts inventories and market presence are also significant factors. A substantial portion of the Company’s business is obtained by 
competitive bids.

As noted above, the Company is the exclusive worldwide distributor of EMD, Cooper, Woodward, Nordberg, Norlake and Hannon 
parts for the nuclear industry, and non-exclusive distributor of Weschler parts and Ingersoll Rand air start equipment for the nuclear 
industry.  Specific  regulations  relating  to  equipment  used  in  nuclear  power  generation  require  extensive  testing  and  certification  of 
replacement parts. OEM parts need to be properly tested and certified for nuclear applications.

Oil and Gas Operations

The Company is engaged in the distribution and service of high-speed diesel engines, pumps and transmissions, and the manufacture 
and remanufacture of oilfield service equipment. The oil and gas operations represented approximately 37% of the segment’s 2021 
revenues.  The  Company  offers  custom  fabricated  oilfield  service  equipment  that  is  fully  tested  and  field  ready.  The  Company 
manufactures  and  remanufactures  oilfield  service  equipment,  including  pressure  pumping  units,  nitrogen  pumping  units,  cementers, 
hydration  equipment,  mud  pumps  and  blenders,  coil  tubing,  well  intervention  equipment,  electric  power  generation  equipment, 
specialized electrical distribution and control equipment, and high capacity energy storage/battery systems.  The Company sells OEM 
replacement parts, and sells and services diesel engines, electric drives, motors and controls, pumps and transmissions, and offers in-
house  and  in-field  service  capabilities.  The  Company  is  the  largest  off-highway  distributor  for  Allison  Transmission  and  a  major 
distributor for MTU in North America.

The Company’s manufacturing and remanufacturing facilities and service facilities are based in Houston, Texas and Oklahoma 

City, Oklahoma, both key oil and gas producing regions.

16

Oil and Gas Customers

The  Company’s  major  oil  and  gas  customers  include  large  and  mid-cap  oilfield  service  providers,  oil  and  gas  operators  and 
producers. The Company has long standing relationships with most of its customers. Since the oil and gas business is linked to the 
oilfield services industry, and oil and gas operators and producers, there is no assurance that its present gross revenues can be maintained 
in the future. The results of the Company’s oil and gas distribution and services operations are largely tied to the industries it serves and, 
therefore, are influenced by the cycles of such industries.

Oil and Gas Competitive Conditions

The  Company’s  primary  competitors  are  other  oilfield  equipment  manufacturers  and  remanufacturers,  and  equipment  service 
companies.  While  price  is  a  major  determinant  in  the  competitive  process,  equipment  availability,  reputation,  consistent  quality, 
expeditious service, experienced personnel, access to parts inventories and market presence are also significant factors. A substantial 
portion of the Company’s business is obtained by competitive bids.

Properties

The  principal  office  of  the  distribution  and  services  segment  is  located  in  Houston,  Texas.  There  are  62  active  facilities  in  the 

distribution and services segment, of which 25 facilities are owned and 37 facilities are leased.

The  oil  and  gas  operation’s  principal  manufacturing  facilities  are  located  in  Houston  and  Austin,  Texas  and  Oklahoma  City, 
Oklahoma, with one location leased and the other two facilities owned by the Company. The oil and gas focused operations have 17 
parts and service facilities, with one in Arkansas, two in Colorado, three in Louisiana, one in New Mexico, one in Oklahoma, eight in 
Texas and one in Wyoming, with many of these facilities shared with the commercial and industrial operations.

The commercial and industrial businesses operate 42 parts and service facilities, with one facility in Alabama, one in Connecticut, 
one in Colorado, 11 in Florida, one in Kentucky, two in Louisiana, one in Massachusetts, one in Oklahoma, three in New Jersey, one in 
New  York,  one  in  North  Carolina,  11  in  Texas,  one  in  Virginia,  one  in  Washington  and  five  facilities  located  in  Colombia,  South 
America.

Human Capital

Employment.  The Company has approximately 5,125 employees, the large majority of whom are in the United States.  The large 
majority  of  non-vessel  employees  work  full-time.    Vessel  employees  work  varying  schedules  according  to  their  assignments.    The 
Company has approximately 130 general corporate employees.  The Company supports its employees by providing competitive pay and 
benefits, training, and a respectful and inclusive culture.

The Company’s marine transportation segment has approximately 3,160 employees, of which approximately 2,485 are vessel crew 
members. None of the segment’s inland operations are subject to collective bargaining agreements. The segment’s coastal operations 
include approximately 500 vessel employees, some of which are subject to collective bargaining agreements in certain geographic areas. 
Approximately 230 Kirby Offshore Marine vessel crew members employed in the Atlantic Division are subject to a collective bargaining 
agreement with the Richmond Terrace Bargaining Unit in effect through August 31, 2022. In addition, approximately 100 vessel crew 
members of Penn Maritime Inc., a wholly owned subsidiary of Kirby Offshore Marine, are represented by the Seafarers International 
Union under a collective bargaining agreement in effect through April 30, 2022.

The Company’s distribution and services segment has approximately 1,835 employees. None of the United Holdings and Kirby 
Engine Systems operations are subject to collective bargaining agreements. Approximately 55 S&S employees in New Jersey are subject 
to a collective bargaining agreement with the Local 15C, International Union of Operating Engineers, AFL-CIO that expires in October 
2023. The remaining S&S employees are not subject to collective bargaining agreements.

Training and Development.  The Company strives to provide its employees with a rewarding work environment, including the 
opportunity for success and an opportunity for personal and professional development.  The development of its people is a key factor in 
the Company's employee retention and satisfaction.  Its technical and skill training has always been a differentiator and has facilitated 
the recruitment of new trainees.  

For the marine business, the Company’s training facility includes state-of-the-art equipment and instruction aids, including a full 
bridge wheelhouse simulator, a working towboat, two tank barges, and a tank barge simulator for tankermen training. During 2021, 
approximately 950 certificates were issued for the completion of courses at the training facility, of which approximately 550 were USCG 
approved classes and the balance were employee development and Company required classes, including leadership, communication, 
and  navigation  courses.  The  Company  uses  the  Seaman’s  Church  Institute  as  an  additional  training  resource  for  its  wheelhouse 

17

crewmembers.  The marine segment provides a clear career progression for vessel personnel from entry level deckhand to captain and 
regularly reviews promotions from one level to another.

In distribution and services, Company facilitates training courses via online courses and instructor-led classes that cover a range of 
skill  related  topics  generator  knowledge,  introduction  to  hydraulic  systems,  introduction  to  electrical  diagrams,  introduction  to 
transformers, and Electrical Generation Systems Association journeyman study, as well as numerous courses led by its OEM partners.  
The distribution and services segment has multiple career progressions within its numerous job groups.

The Company's leadership and managerial training includes in-person and an on-line training curriculum that is available to both 
supervisory employees and those employees that aspire to move into such roles in the future.  It includes a series of classes focused on 
management essentials which provide in-depth education in specific subjects such as leadership, strategic thinking, coaching and people 
development, decision making, problem solving, and communication. 

In addition, the Company facilitates many training courses that cover a range of topics that enhance specific skill sets, increase 
productivity,  and  educate  employees  about  safety  and  team  morale  across  both  business  segments.    Training  classes  include 
environmental, health, and safety classes, compliance, leadership, and general business skills related courses. Environmental, health, 
and  safety  topics  include  defensive  and  distracted  driving,  first  aid  basic  and  medical  emergencies,  global  safety  principles,  oil 
management, and hazardous substances training. Compliance topics include anti-corruption training, cybersecurity awareness, business 
ethics, compliance, and promoting diversity. Skill related topics include business writing, risk-based thinking, initiating and planning a 
project, and transitioning into a project management role. 

Diversity, Equity, and Inclusion.  The Company has a diversity committee whose purpose is to continuously enhance workplace 
diversity. In 2019 and 2020, committee initiatives included training to help increase awareness and drive inclusive behaviors, identifying 
areas for improvement and providing oversight for hiring, promotions, and mentoring. In 2021, the Company instituted an organization-
wide training initiative that expanded the understanding and awareness of diversity and inclusion.  Over 5,000 employees successfully 
completed this training.

Succession Planning. Succession planning is a key responsibility of the CEO and Chief Human Resources Officer and is a critical 
annual  process  for  the  Company's  senior  management  and  its  Board.    Senior  management  reviews  their  succession  plans  regularly 
throughout the year and on an annual basis provides the Board an in-depth review of the top three levels of management.  This process 
looks at qualifications, time in role, readiness to advance, diversity, and required development.  The Board engages with many of these 
individuals  through  presentations  on  a  variety  of  projects  and  subjects.    The  development  initiatives  undertaken  with  those  in  the 
succession plan may comprise of 360-degree feedback, high level post graduate work, targeted development work around strengthening 
a needed competency, or additional industry exposure.

Culture,  Engagement,  and  Social  Responsibility.    The  Company  recognizes  the  importance  of  employee  engagement  and  has 
implemented  a  regular  process  of  surveying  its  employees  to  obtain  their  feedback  on  both  what  is  working  well  and  areas  of 
improvement.  One of the main take-aways from the 2021 survey was 90% of employees surveyed agree that Kirby is committed to 
Employee Safety, this was a 6% increase over the last survey.  85% of our employees believe our culture is responsible for high retention 
and low turnover.  In addition, the survey reflected that employees are engaged and have pride in Kirby and they provided positive 
feedback on their relationships with their managers.  In 2019 employees indicated they wanted more communication and this feedback 
led to specific initiatives including an increased use of town halls, both in person and virtual.   Additionally, the responses to the 2019 
survey resulted in a common set of values where a cross functional team was assembled to develop these values into what the Company 
now calls The Kirby Way.  The Kirby Way is an amalgamation of Kirby’s Vision, Mission, Core Values, and Behavior Expectations.  
These are principles that have been communicated and are owned throughout the organization.

The Company provides its employees with a rewarding work environment, which includes access to resources for personal and 
professional  development.  The  Company  often  participates  in  community  organizations,  service  projects  and  matches  employee 
charitable contributions. Through the Kirby Disaster Relief Fund, the Company supports employees in need following natural disasters 
and other qualified hardships.  The Company provides employees with tuition reimbursement and college scholarships for to the children 
of employees.  In addition to standard health and welfare benefits the Company offers wellness incentives and initiatives that encourages 
employees to receive an annual wellness checkup.

COVID-19 Pandemic Response.   The Company responded to the COVID-19 pandemic in a manner consistent with its Core Values 
of Safety and People.  The Company's response involved real time decision making needed to continue operations with the least amount 
of disruption for its customers.  The Company implemented measures which included the use of protective equipment, health checks, 
temperature  checks,  travel  restrictions,  protocols  for  employees  whose  duties  could  not  be  accomplished  through  remote  working 
arrangements, and implementing technology required for those that could work remotely.

18

Of the Company's 5,125 employees, approximately 1,000 could perform their work remotely.  The Company implemented changes 
needed  to  cover  people  for  certain  additional  medical  costs  that  might  occur  and  implemented  a  virtual  telehealth  option  for  those 
needing  immediate  care  and  medical  advice.    In  addition,  the  Company  implemented  testing  provisions,  cleaning  guidelines,  social 
distancing,  density  reduction,  and  mask  protocols.    The  Company  modified  scheduling  to  reduce  travel  and  hotel  exposure  where 
practical. 

Information about the Company’s Executive Officers

The executive officers of the Company are as follows:

Name
David W. Grzebinski
Raj Kumar
William G. Harvey
Christian G. O’Neil
Joseph H. Reniers
Dorman L. Strahan
Kim B. Clarke
Ronald A. Dragg
Eric S. Holcomb
Amy D. Husted
Scott P. Miller
Kurt A. Niemietz
William M. Woodruff

Age
60
49
64
49
47
65
66
58
47
53
43
49
61

Positions and Offices

President and Chief Executive Officer
Executive Vice President and Chief Financial Officer
Executive Vice President
President – Kirby Inland Marine, Kirby Offshore Marine, and San Jac Marine, LLC
President – Kirby Distribution & Services, Inc.
President – Kirby Engine Systems
Vice President and Chief Human Resources Officer
Vice President, Controller and Assistant Secretary
Vice President – Investor Relations
Vice President, General Counsel and Secretary
Vice President and Chief Information Officer
Vice President and Treasurer
Vice President – Public and Governmental Affairs

No family relationship exists among the executive officers or among the executive officers and the directors. Officers are elected 
to  hold  office  until  the  annual  meeting  of  directors,  which  immediately  follows  the  annual  meeting  of  stockholders,  or  until  their 
respective successors are elected and have qualified.

David W. Grzebinski is a Chartered Financial Analyst and holds a Master of Business Administration degree from Tulane University 
and a degree in chemical engineering from the University of South Florida. He has served as President and Chief Executive Officer 
since April 2014. He served as President and Chief Operating Officer from January 2014 to April 2014 and as Chief Financial Officer 
from March 2010 to April 2014. He served as Chairman of Kirby Offshore Marine from February 2012 to April 2013 and served as 
Executive  Vice  President  from  March  2010  to  January  2014.  Prior  to  joining  the  Company  in  February  2010,  he  served  in  various 
operational and financial positions since 1988 with FMC Technologies Inc. (“FMC”), including Controller, Energy Services, Treasurer, 
and  Director  of  Global  SAP  and  Industry  Relations.  Prior  to  joining  FMC,  he  was  employed  by  Dow  Chemical  Company  in 
manufacturing, engineering and financial roles.

Raj Kumar is a member of CPA Australia and holds a Master of Business Administration degree from Columbia University in New 
York City and a Bachelor of Business in Accounting from Deakin University in Australia.  He has served as Executive Vice President 
and  Chief  Financial  Officer  since  November  2021.  Prior  to  joining  the  Company,  Mr.  Kumar  served  as  Vice  President  and  Chief 
Financial Officer of Dril-Quip, Inc. from 2020 to 2021, Vice President and Chief Accounting Officer from 2019 to 2020, and Vice 
President and Treasurer from 2017 to 2019.  Prior to joining Dril-Quip, he served as Vice President Finance at Franks International from 
2015 to 2017.  Prior to that, he served as a segment controller at LyondellBasell and in Division CFO, treasury, strategic planning and 
corporate development positions at FMC Technologies and Dell Technologies.

William G. Harvey is a Chartered Financial Analyst and holds a Master of Business Administration degree from the University of 
Toronto and a degree in mechanical engineering from Queens University. He has served as Executive Vice President since November 
2021.  He served as Executive Vice President and Chief Financial Officer from February 2018 to November 2021 and as Executive Vice 
President – Finance from January 2018 to February 2018. Prior to joining the Company, Mr. Harvey served as Executive Vice President 
and Chief Financial Officer of Walter Energy, Inc. from 2012 to 2017, Senior Vice President and Chief Financial Officer of Resolute 
Forest Products Inc. (“Resolute”) from 2008 to 2011, and as Executive Vice President and Chief Financial Officer of Bowater Inc., a 
predecessor company of Resolute, from 2004 to 2008.

Christian G. O’Neil holds a Master of Business Administration degree from Rice University, a doctorate of jurisprudence from 
Tulane University and a bachelor of arts degree from Southern Methodist University. He has served as President of Kirby Inland Marine 
and Kirby Offshore Marine since January 2018 and as President of San Jac Marine, LLC since October 2018. He served as Executive 
Vice President and Chief Operating Officer of Kirby Inland Marine and Kirby Offshore Marine from May 2016 to January 2018. He 
also served as Executive Vice President – Commercial Operations of Kirby Inland Marine and Kirby Offshore Marine from April 2014 
to May 2016, Vice President – Human Resources of the Company from May 2012 to April 2014, Vice President – Sales for Kirby Inland 

19

Marine  from  2009  to  2012  and  President  of  Osprey  from  2006  through  2008.  He  has  also  served  in  various  sales  and  business 
development  roles  at  the  Company  and  Osprey.  Prior  to  joining  the  Company,  he  served  as  Sales  Manager  and  Fleet  Manager  at 
Hollywood  Marine,  Inc.  (“Hollywood  Marine”)  after  joining  Hollywood  Marine  in  1997  which  was  subsequently  merged  into  the 
predecessor of Kirby Inland Marine.

Joseph H. Reniers holds a Master of Business Administration degree from the University of Chicago Booth School of Business and 
a  degree  in  mechanical  engineering  from  the  United  States  Naval  Academy.  He  has  served  the  Company  as  President  –  Kirby 
Distribution & Services, Inc. since September 2017. He served as Executive Vice President – Diesel Engine Services and Supply Chain 
from May 2016 to September 2017, Senior Vice President – Diesel Engine Services and Marine Facility Operations from February 2015 
to May 2016, Vice President – Strategy and Operational Service from April 2014 to February 2015, Vice President – Supply Chain from 
April 2012 to April 2014 and Vice President – Human Resources from March 2010 to April 2012. Prior to joining the Company, he was 
a management consultant with McKinsey & Company serving a wide variety of industrial clients. Prior to joining McKinsey, he served 
as a nuclear power officer in the Navy.

Dorman L. Strahan attended Nicholls State University and has served the Company as President of Kirby Engine Systems since 
May 1999, President of Marine Systems since 1986 and President of Engine Systems since 1996. After joining the Company in 1982 in 
connection with the acquisition of Marine Systems, he served as Vice President of Marine Systems until 1985.

Kim B. Clarke holds a Bachelor of Science degree from the University of Houston. She has served as Vice President and Chief 
Human Resources Officer since October 2017. She served as Vice President – Human Resources from December 2016 to October 2017. 
Prior to joining the Company, she served in senior leadership roles in human resources, safety, information technology and business 
development as Senior Vice President and Chief Administration Officer for Key Energy Services, Inc. from 2004 to March 2016.

Ronald A. Dragg is a Certified Public Accountant and holds a Master of Science in Accountancy degree from the University of 
Houston and a degree in finance from Texas A&M University. He has served the Company as Vice President, Controller and Assistant 
Secretary  since  April  2014.  He  also  served  as  Vice  President  and  Controller  from  January  2007  to  April  2014,  as  Controller  from 
November 2002 to January 2007, Controller – Financial Reporting from January 1999 to October 2002, and Assistant Controller – 
Financial  Reporting  from  October  1996  to  December  1998.  Prior  to  joining  the  Company,  he  was  employed  by  Baker  Hughes 
Incorporated.

Eric S. Holcomb is a Certified Public Accountant and holds a Bachelor of Business Administration degree in accounting from 
Southern  Methodist  University.  He  has  served  the  Company  as  Vice  President  –  Investor  Relations  since  December  2017.  Prior  to 
joining the Company, he was employed by Baker Hughes Incorporated from 2003 to December 2017 serving in various roles including 
Investor  Relations  Director,  Finance  Director  for  North  America  Land,  Finance  Director  for  North  America  Offshore  and  Finance 
Director for Canada.

Amy D. Husted holds a doctorate of jurisprudence from South Texas College of Law and a Bachelor of Science degree in political 
science from the University of Houston. She has served the Company as Vice President, General Counsel and Secretary since April 
2019.  She also served as Vice President and General Counsel from January 2017 to April 2019, Vice President – Legal from January 
2008 to January 2017 and Corporate Counsel from November 1999 through December 2007. Prior to joining the Company, she served 
as Corporate Counsel of Hollywood Marine from 1996 to 1999 after joining Hollywood Marine in 1994.

Scott P. Miller holds a Bachelor of Science in Management of Information Systems from Louisiana State University and a Master 
of Business Administration degree from the University of Houston.  He has served as Vice President and Chief Information Officer 
since April 2019.  Prior to joining the Company, he was employed by Key Energy Services, Inc. from May 2006 to March 2019, serving 
in various senior leadership roles including Managing Director of Strategy, Vice President and Chief Information Officer from March 
2013 to December 2015 and as Senior Vice President, Operations Services and Chief Administrative Officer from January 2016 to 
March 2019.

Kurt A. Niemietz holds a Master of Business Administration degree from St. Mary’s University and a degree in accounting from 
the University of Texas at San Antonio. He has served as Vice President and Treasurer since April 2019.  Prior to joining the Company, 
he was employed by Pacific Drilling from 2013 to 2019, serving in various roles of increasing responsibility, including Treasurer from 
2017 to 2019, and in various financial positions with FMC, from 2006 to 2013. Prior to joining FMC, he was employed by Austin, 
Calvert & Flavin as a buy-side equity analyst.

William M. Woodruff holds a doctorate of jurisprudence from the University of Houston Law Center and a bachelor of science 
degree from Texas A&M University. He has served as Vice President – Public and Governmental Affairs since October 2017. He served 
as Director – Public & Government Affairs from 2014 to October 2017 after joining the Company as Director – Government Affairs in 
2004. Prior to joining the Company, he was a maritime lawyer in private practice and Vice President and General Counsel of Coastal 
Towing, Inc.

20

Item 1A. Risk Factors

In addition to the other information set forth elsewhere in this annual report, the following risk factors should be considered carefully 
when evaluating the Company, as its businesses, results of operations, or financial condition could be materially adversely affected by 
any of these risks. The following discussion does not attempt to cover factors, such as trends in the United States and global economies 
or the level of interest rates, among others, that are likely to affect most businesses.

Marine Transportation Segment Risk Factors

The  Inland  Waterway  infrastructure  is  aging  and  may  result  in  increased  costs  and  disruptions  to  the  Company’s  marine 
transportation segment. Maintenance of the United States inland waterway system is vital to the Company’s operations. The system is 
composed of over 12,000 miles of commercially navigable waterway, supported by over 240 locks and dams designed to provide flood 
control, maintain pool levels of water in certain areas of the country and facilitate navigation on the inland river system. The United 
States inland waterway infrastructure is aging, with more than half of the locks over 50 years old. As a result, due to the age of the locks, 
scheduled and unscheduled maintenance outages may be more frequent in nature, resulting in delays and additional operating expenses. 
Currently, 35% of the cost of new construction and major rehabilitation of locks and dams is paid by marine transportation companies 
through a 29 cent per gallon diesel fuel tax and the remaining 65% of waterway infrastructure and improvement is paid from general 
federal tax revenues. Failure of the federal government to adequately fund infrastructure maintenance and improvements in the future 
would have a negative impact on the Company’s ability to deliver products for its customers on a timely basis. In addition, any additional 
user taxes that may be imposed in the future to fund infrastructure improvements would increase the Company’s operating expenses.

The Company could be adversely impacted by a marine accident or spill event. A marine accident or spill event could close a 
portion of the inland waterway system or a coastal area of the United States for an extended period of time. Although statistically marine 
transportation is the safest means of surface transportation of bulk commodities, accidents do occur, both involving Company equipment 
and equipment owned by other marine operators.

The  Company  transports  a  wide  variety  of  petrochemicals,  black  oil,  refined  petroleum  products  and  agricultural  chemicals 
throughout the Mississippi River System, on the Gulf Intracoastal Waterway, and coastwise along all three United States coasts. The 
Company manages its exposure to losses from potential unauthorized discharges of pollutants through the use of well-maintained and 
equipped tank barges and towing vessels, through safety, training and environmental programs, and through the Company’s insurance 
program, but a discharge of pollutants by the Company could have an adverse effect on the Company. Risks may arise for which the 
Company may not be insured. Claims covered by insurance are subject to deductibles, the aggregate amount of which could be material, 
and  certain  policies  impose  limitations  on  coverage.  Existing  insurance  coverage  may  not  be  able  to  be  renewed  at  commercially 
reasonable rates or coverage capacity for certain risks may not be available or adequate to cover future claims. If a loss occurs that is 
partially or completely uninsured, or the carrier is unable or unwilling to cover the claim, the Company could be exposed to liability.

The Company’s marine transportation segment is dependent on its ability to adequately crew its towing vessels. The Company’s 
vessels are crewed with employees who are licensed or certified by the USCG, including its captains, pilots, engineers and tankermen. 
The success of the Company’s marine transportation segment is dependent on the Company’s ability to adequately crew its vessels. As 
a result, the Company invests significant resources in training its crews and providing crew members an opportunity to advance from a 
deckhand to the captain of a Company towboat or tugboat. Inland crew members generally work rotations such as 20 days on, 10 days 
off rotation, or a 30 days on, 15 days off rotation. For the coastal fleet, crew members are generally required to work rotations such as 
14 days on, 14 days off rotation, a 21 days on, 21 days off rotation or a 30 days on, 30 days off rotation, dependent upon the location. 
The nature of crewmember work schedules and assignments away from home for extended periods require special recruiting and at 
times it can be difficult to find candidates. With ongoing retirements and competitive labor pressure in the marine transportation segment, 
the Company continues to monitor and implement market competitive pay practices. The Company also utilizes an internal development 
program to train Maritime Academy graduates for vessel leadership positions.

The Company’s marine transportation segment has approximately 3,160 employees, of which approximately 2,485 are vessel crew 
members. None of the segment’s inland operations are subject to collective bargaining agreements. The segment’s coastal operations 
include approximately 500 vessel employees, of whom approximately 330 are subject to collective bargaining agreements in certain 
geographic areas. Any work stoppages or labor disputes could adversely affect coastal operations in those areas.  While the COVID-19 
Delta and Omicron variants have caused some crewing issues, to date, the Company has been able to manage its operations with only 
limited vessel delays and disruption of services, including some loss of revenue and incremental costs in the Company's inland and 
coastal businesses.  The Company continues to update its protocols relating to management of COVID-19 and provide related employee 
education as new information and guidance becomes available.

The Company’s marine transportation segment is subject to the Jones Act. The Company’s marine transportation segment competes 
principally in markets subject to the Jones Act, a federal cabotage law that restricts domestic marine transportation in the United States 
to vessels built and registered in the United States, and manned, owned and operated by United States citizens. The Company presently 

21

meets all of the requirements of the Jones Act for its owned and operated vessels. The loss of Jones Act status could have a significant 
negative effect on the Company. The requirements that the Company’s vessels be United States built and manned by United States 
citizens, the crewing requirements and material requirements of the USCG, and the application of United States labor and tax laws 
increases the cost of United States flagged vessels compared to comparable foreign flagged vessels. The Company’s business could be 
adversely affected if the Jones Act or international trade agreements or laws were to be modified or waived as to permit foreign flagged 
vessels to operate in the United States as these vessels are not subject to the same United States government imposed regulations, laws, 
and restrictions. Since the events of September 11, 2001, the United States government has taken steps to increase security of United 
States ports, coastal waters and inland waterways. The Company believes that it is unlikely that the current cabotage provisions of the 
Jones Act would be eliminated or significantly modified in a way that has a material adverse impact on the Company in the foreseeable 
future.

The Secretary of Homeland Security is vested with the authority and discretion to waive the Jones Act to such extent and upon such 
terms as the Secretary may prescribe whenever the Secretary deems that such action is necessary in the interest of national defense. On 
September 8, 2017, following Hurricanes Harvey and Irma, the Department of Homeland Security issued a waiver of the Jones Act for 
a 7-day period for shipments from New York, Pennsylvania, Texas and Louisiana to South Carolina, Georgia, Florida and Puerto Rico. 
The waiver was specifically tailored to address the transportation of refined petroleum products due to disruptions in hurricane-affected 
areas. On September 11, 2017, the waiver was extended for 11 days and expanded to include additional states. Following Hurricane 
Maria, on September 28, 2017, the Department of Homeland Security issued a waiver of the Jones Act for movement of products shipped 
from United States coastwise points to Puerto Rico through October 18, 2017.  Two limited waivers of the Jones Act were granted in 
connection with the shutdown of the Colonial Pipeline in May 2021.  Waivers of the Jones Act, whether in response to natural disasters 
or  otherwise,  could  result  in  increased  competition  from  foreign  tank  vessel  operators,  which  could  negatively  impact  the  marine 
transportation segment.

The Company’s marine transportation segment is subject to extensive regulation by the USCG, federal laws, other federal agencies, 
various state laws, the laws of other countries when operating in their waters, and certain international conventions, as well as numerous 
environmental  regulations.  The  majority  of  the  Company’s  vessels  are  subject  to  inspection  by  the  USCG  and  carry  certificates  of 
inspection.  The  crews  employed  by  the  Company  aboard  vessels  are  licensed  or  certified  by  the  USCG.    The  Company's  marine 
transportation operations are subject to laws of other countries when operating in their waters.  The Company is required by various 
governmental agencies to obtain licenses, certificates and permits for its owned and operated vessels. The Company’s operations are 
also affected by various United States and state regulations and legislation enacted for protection of the environment. The Company 
incurs significant expenses and capital expenditures to comply with applicable laws and regulations and any significant new regulation 
or legislation, including climate change laws or regulations, could have an adverse effect on the Company.

The Company’s marine transportation segment is subject to natural gas and crude oil prices as well as the volatility of their prices 
as  well  as  the  volatility  in  production  of  refined  products  and  petrochemicals  in  the  United  States.  For  2021,  50%  of  the  marine 
transportation segment’s revenues were from the movement of petrochemicals, including the movement of raw materials and feedstocks 
from one refinery or petrochemical plant to another, as well as the movement of more finished products to end users and terminals for 
export. As a result of the COVID-19 pandemic and petrochemical and refinery plant shutdowns, 2020 and 2021 petrochemical and 
refined products volumes decreased relative to 2019.  Volumes began to recover in 2021 as economic activity improved.  The United 
States petrochemical industry continues to benefit from a low-cost domestically produced natural gas feedstock advantage, producing 
strong  volumes  of  raw  materials  and  intermediate  products  for  transportation  between  Gulf  Coast  petrochemical  plants  and  the 
transportation of more finished products to terminals for both domestic consumers and for export destinations.  In addition, nine new 
United States petrochemical projects, including expansion of existing plants, are scheduled to be completed during 2022, which should 
provide additional movements for the marine transportation segment.  These increases are partially offset by a reduction in United States 
refining  capacity  since  the  beginning  of  the  COVID-19  pandemic.    During  2020,  five  refineries  with  a  combined  capacity  of 
approximately 800,000 barrels per day were closed, of which three have been or are being converted to produce renewable diesel.  In 
2021, an additional refinery with a capacity of approximately 255,000 barrels per day was closed as a result of damages incurred from 
Hurricane Ida.  Higher natural gas and crude oil prices are generally better for the Company’s businesses; however, higher natural gas 
prices  and  other  factors  could  negatively  impact  the  United  States  petrochemical  industry  and  its  production  volumes,  which  could 
negatively impact the Company.

Demand  for  tank  barge  transportation  services  is  driven  by  the  production  of  volumes  of  the  bulk  liquid  commodities  such  as 
petrochemicals, black oil and refined petroleum products that the Company transports by tank barge. This production can depend on the 
prevailing level of natural gas and crude oil prices, as well as the volatility of their prices.  In general, lower energy prices are good for 
the United States economy and typically translate into increased petrochemical and refined product demand and therefore increased 
demand for tank barge transportation services. However, during 2016 and 2017 lower crude oil prices resulted in a decline in domestic 
crude oil and natural gas condensate production and reduced volumes to be transported by tank barge. The Company estimates that at 
the beginning of 2015 there were approximately 550 inland tank barges and 35 coastal tank barges in the 195,000 barrels or less category 
transporting crude oil and natural gas condensate. By the end of 2019, the Company estimates that number of tank barges had declined 
to 335 inland tank barges and approximately five coastal tank barges transporting crude and natural gas condensate.  During 2020, the 

22

COVID-19  pandemic  and  oil  price  volatility  resulted  in  a  sharp  decrease  in  volumes  of  crude  and  natural  gas  condensate  being 
transported.  As of the end of 2020, the Company estimates that approximately 100 to 150 inland tank barges and one coastal tank barge 
were transporting crude and natural gas condensate and at the end of 2021, approximately 160 to 170 inland tank barges and one coastal 
tank barge were transporting crude and natural gas condensate.  Volatility in the price of natural gas and crude oil can also result in 
heightened  uncertainty  which  may  lead  to  decreased  production  and  delays  in  new  petrochemical  and  refinery  plant  construction. 
Increased competition for available black oil and petrochemical barge moves caused by reduced crude oil and natural gas condensate 
production could have an adverse impact on the Company’s marine transportation segment including as a result of lower spot and term 
contract rates and/or reluctance to enter into or extend term contracts.

The Company’s marine transportation segment could be adversely impacted by the construction of tank barges by its competitors. 
At the present time, there are an estimated 4,000 inland tank barges in the United States, of which the Company operates 1,025, or 26%. 
The number of tank barges peaked at an estimated 4,200 in 1982, slowly declined to 2,750 by 2003, and then gradually increased to an 
estimated 3,850 by the end of 2015 and 2016 and remained relatively flat since 2015.  For 2019, the Company estimated that industry-
wide 150 new tank barges were placed in service, of which none were by the Company, and 100 tank barges were retired, 17 of which 
were by the Company.  For 2020, the Company estimated that industry-wide approximately 150 new tank barges were placed in service, 
six of which were purchased by the Company from another operator, and approximately 150 tank barges were retired, 95 of which were 
by the Company.  For 2021, the Company estimated that industry-wide 70 new tank barges were placed in service, of which none were 
by the Company, and 90 tank barges were retired, 36 of which were by the Company.   The Company estimates that approximately 5 to 
10 new tank barges have currently been ordered for delivery in 2022 and expects a number of older tank barges will be retired, dependent 
on 2022 market conditions.

The long-term risk of an oversupply of inland tank barges may be mitigated by the fact that the inland tank barge industry has 
approximately 385 tank barges that are 30 years old or older and approximately 280 of those are 40 years old or older.  Given the age 
profile of the industry inland tank barge fleet and extensive customer vetting standards, the expectation is that these older tank barges 
will continue to be removed from service and replaced by new tank barges as needed, with the extent of both retirements and new builds 
dependent on petrochemical and refinery production levels and crude oil and natural gas condensate movements, both of which can have 
a direct effect on industry-wide tank barge utilization, as well as term and spot contract rates.

During  2019,  2020,  and  2021,  a  decline  in  industry-wide  demand  for  the  movement  of  crude  oil  and  natural  gas  condensate 
transportation volumes increased available capacity and resulted in some reluctance among certain customers to extend term contracts, 
which led to an increase in the number of coastal vessels operating in the spot market. In addition, the Company and the industry added 
new coastal tank barge capacity during 2019, 2020, and 2021.  Much of this new capacity is replacement capacity for older vessels 
anticipated to be retired.

The Company estimates there are approximately 270 tank barges operating in the 195,000 barrels or less coastal industry fleet, the 
sector of the market in which the Company operates, and approximately 20 of those are over 25 years old.  The Company is aware of 
two coastal ATBs placed in service in 2019, one in 2020, and one small specialized coastal ATB in 2021 by competitors.  There was 
one  announced  small  specialized  coastal  ATB  delivered  in  the  first  quarter  of  2021,  with  no  further  coastal  barges  currently  under 
construction.

Higher fuel prices could increase operating expenses and fuel price volatility could reduce profitability. The cost of fuel during 
2021 was approximately 11% of marine transportation revenue. The Company's marine transportation term contracts typically include 
fuel escalation clauses, or the customer pays for the fuel.  However, there is generally a 30 to 90 day delay before contracts are adjusted 
depending on the specific contract.  In general, the fuel escalation clauses are effective over the long-term in allowing the Company to 
adjust to changes in fuel costs due to fuel price changes; however, the short-term effectiveness of the fuel escalation clauses can be 
affected  by  a  number  of  factors  including,  but  not  limited  to,  specific  terms  of  the  fuel  escalation  formulas,  fuel  price  volatility, 
navigating conditions, tow sizes, trip routing, and the location of loading and discharge ports that may result in the Company over or 
under recovering its fuel costs. The Company’s spot contract rates generally reflect current fuel prices at the time the contract is signed 
but do not have escalators for fuel.

Significant increases in the construction cost of tank barges and towing vessels may limit the Company’s ability to earn an adequate 
return  on  its  investment  in  new  tank  barges  and  towing  vessels.  The  price  of  steel,  economic  conditions,  and  supply  and  demand 
dynamics can significantly impact the construction cost of new tank barges and towing vessels. Over the last 20 years, the Company’s 
average construction price for a new 30,000 barrel capacity inland tank barge has fluctuated up or down significantly. For example, the 
average  construction  price  for  a  new  30,000  barrel  capacity  tank  barge  in  2009  was  approximately  90%  higher  than  in  2000,  with 
increases primarily related to higher steel costs. During 2009, the United States and global recession negatively impacted demand levels 
for inland tank barges and as a result, the construction price of inland tank barges fell significantly in 2010, primarily due to a significant 
decrease in steel prices, as well as a decrease in the number of tank barges ordered. During 2020, at the onset of the COVID-19 pandemic, 
steel costs dropped, however, during 2021, steel prices rose above 2019 levels.  These increases in steel costs and improvement in supply 

23

and demand dynamics resulted in construction prices for a new 30,000 barrel tank barge increasing compared to prices in 2017 when 
there was an industry-wide over-capacity of inland tank barges in the market.

The Company’s marine transportation segment could be adversely impacted by the failure of the Company’s shipyard vendors to 
deliver new vessels according to contractually agreed delivery schedules and terms. The Company contracts with shipyards to build 
new vessels and currently has many vessels under construction. Construction projects are subject to risks of delay and cost overruns, 
resulting from shortages of equipment, materials and skilled labor; lack of shipyard availability; unforeseen design and engineering 
problems;  work  stoppages;  weather  interference;  unanticipated  cost  increases;  unscheduled  delays  in  the  delivery  of  material  and 
equipment;  and  financial  and  other  difficulties  at  shipyards  including  labor  disputes,  shipyard  insolvency  and  inability  to  obtain 
necessary certifications and approvals. A significant delay in the construction of new vessels or a shipyard’s inability to perform under 
the construction contract could negatively impact the Company’s ability to fulfill contract commitments and to realize timely revenues 
with respect to vessels under construction. Significant cost overruns or delays for vessels under construction could also adversely affect 
the Company’s financial condition, results of operations and cash flows.  To date, the Company has not experienced significant shipyard 
delays associated with the COVID-19 pandemic, including at its subsidiary, San Jac.

The Company is subject to competition in its marine transportation segment. The inland and coastal tank barge industry remains 
very fragmented and competitive. The Company’s primary competitors are noncaptive inland tank barge operators and coastal operators. 
The Company also competes with companies who operate refined product and petrochemical pipelines, railroad tank cars and tractor-
trailer tank trucks. Increased competition from any significant expansion of or additions to facilities or equipment by the Company’s 
competitors could have a negative impact on the Company’s results of operations. In addition, the Company’s failure to adhere to its 
safety, reliability and performance standards may impact its ability to retain current customers or attract new customers.

Distribution and Services Segment Risk Factors

The  Company’s  distribution  and  services  segment  could  be  adversely  impacted  by  future  legislation,  executive  or  other 
governmental orders, or additional regulation of oil and gas extraction, including hydraulic fracturing practices. The Company, through 
its United and S&S subsidiaries, is a distributor and service provider of engine and transmission related products for the oil and gas 
services, power generation and transportation industries, and a manufacturer of oilfield service equipment, including pressure pumping 
units. The EPA is studying hydraulic fracturing practices, and legislation may be enacted by Congress that would authorize the EPA to 
impose additional regulations on hydraulic fracturing. In addition, a number of states have adopted or are evaluating the adoption of 
legislation  or  regulations  governing  hydraulic  fracturing  or  byproducts  of  the  fracturing  process.    On  January  20,  2021,  the  Biden 
Administration issued a number of executive orders related to environmental matters that could affect the operations of the Company's 
customers, including an Executive Order on "Protecting Public Health and the Environment and Restoring Science to Tackle the Climate 
Crisis" seeking to adopt new regulations and policies to address climate change and suspend, revise, or rescind prior agency actions that 
are identified as conflicting with the Biden Administration's climate policies.  Among the areas that could be affected by the review are 
regulations addressing methane emissions and the part of the extraction process known as hydraulic fracturing.  Various legislative and 
regulatory initiatives have been proposed that, if passed, could limit or discourage future production of oil and gas. Federal or state 
legislation, executive or governmental orders, and/or regulations could materially impact customers’ operations and greatly reduce or 
eliminate demand for the Company’s pressure pumping fracturing equipment and related products. The Company is unable to predict 
whether future legislation or any other regulations will ultimately be enacted and, if so, the impact on the Company’s distribution and 
services segment.

The Company’s distribution and services segment could be adversely impacted by the construction of pressure pumping units by its 
competitors. In early 2015, an estimated 21 million horsepower of pressure pumping units were working, or available to work, in North 
America. By late 2016, the working horsepower in North America had declined to an estimated 6 million, with an estimated 2 million 
horsepower scrapped, an estimated 2 million horsepower available for work and an estimated 12.5 million horsepower stacked, the large 
majority of which would require major service before being placed back in service. A significant drop in demand due to the low price 
of crude oil resulted in an oversupply in the pressure pumping market and negatively impacted the Company’s 2015 and 2016 results of 
operations. During 2017 and 2018, with the stabilization of crude oil prices in the $40 to $70 per barrel range, the United States land rig 
count improved and service intensity in the well completion business increased. As a result, the Company experienced a healthy rebound 
in  service  demand  during  2018,  particularly  with  pressure  pumping  unit  remanufacturing  and  transmission  overhauls,  and  with  the 
acquisition of S&S in September 2017, the manufacture of oilfield service equipment, including pressure pumping units, and the sale of 
transmissions.  At the end of 2019, an estimated 15 million horsepower of pressure pumping units were working in North America, with 
an estimated 6 million horsepower available to work, and 3 million horsepower stacked and in need of major repair.  During 2020, a 
significant reduction in oilfield activity as a result of oil price volatility throughout 2019 and 2020 and the COVID-19 pandemic resulted 
in a decrease to an estimated 6 million horsepower of pressure pumping units working in North America, with an estimated 1.5 million 
horsepower available to work, and 12 million horsepower stacked and in need of major repair.  At the end of 2021, strong commodity 
prices resulted in an increase to an estimated 12 million horsepower of pressure pumping units working in North America, with an 
estimated 8 million horsepower idled and in need of major repair.  Increased expansion of, or additions to, facilities or equipment by the 
Company’s competitors could have a negative impact on the Company’s results of operations.

24

Prevailing natural gas and crude oil prices, as well as the volatility of their prices, could have an adverse effect on the distribution 
and services segment business. Lower energy prices generally result in a decrease in the number of oil and gas wells being drilled. 
Oilfield service companies reduce their capital spending, resulting in decreased demand for new parts and equipment, including pressure 
pumping units, provided by the Company’s distribution and services segment. This may also lead to order cancellations from customers 
or customers requesting to delay delivery of new equipment. The Company also services offshore supply vessels and offshore drillings 
rigs operating in the Gulf of Mexico, as well as internationally. Low energy prices may negatively impact the number of wells drilled 
in the Gulf of Mexico and international waters. Prolonged downturns in oil and gas prices may cause substantial declines in oilfield 
service and exploration expenditures and could adversely impact oil and gas manufacturing, remanufacturing, parts and distribution 
business. In addition, energy price volatility may also result in difficulties in the Company’s ability to ramp up and ramp down production 
on a timely basis and, therefore, could result in an adverse impact on the Company’s distribution and services segment.

The  Company  is  subject  to  competition  in  its  distribution  and  services  segment.  The  distribution  and  services  industry  is  very 
competitive.  The  segment’s  oil  and  gas  market’s  principal  competitors  are  independent  distribution  and  service  and  oilfield 
manufacturing companies and other factory-authorized distributors and service centers. In addition, certain oilfield service companies 
that are customers of the Company also manufacture and service a portion of their own oilfield equipment. Increased competition in the 
distribution and services industry and continued low price of natural gas, crude oil or natural gas condensate, and resulting decline in 
drilling for such natural resources in North American shale formations, could result in less oilfield equipment being manufactured and 
remanufactured,  lower  rates  for  service  and  parts  pricing  and  result  in  less  manufacturing,  remanufacturing,  service  and  repair 
opportunities  and  parts  sales  for  the  Company.  For  the  commercial  and  industrial  market,  the  segment’s  primary  marine  diesel 
competitors  are  independent  diesel  services  companies  and  other  factory-authorized  distributors,  authorized  service  centers  and 
authorized marine dealers. Certain operators of diesel powered marine equipment also elect to maintain in-house service capabilities. 
For power generation, the primary competitors are other independent service companies.

Loss of a distributorship or other significant business relationship could adversely affect the Company’s distribution and services 
segment.  The Company’s distribution and services segment has had a relationship with EMD, the largest manufacturer of medium-
speed diesel engines, for 56 years. The Company, through Kirby Engine Systems, serves as both an EMD distributor and service center 
for  select  markets  and  locations  for  both  service  and  parts.  With  the  acquisition  of  S&S  in  September  2017,  the  Company  added 
additional  EMD  exclusive  distributorship  rights  in  key  states,  primarily  through  the  Central,  South  and  Eastern  areas  of  the  United 
States. With the S&S acquisition, the Company became the United States distributor for EMD marine and power generation applications. 
Sales  and  service  of  EMD  products  account  for  approximately  3%  of  the  Company’s  revenues  for  2021.  Although  the  Company 
considers its relationship with EMD to be strong, the loss of the EMD distributorship and service rights, or a disruption of the supply of 
EMD parts, could have a negative impact on the Company’s ability to service its customers.  In 2020, with the acquisition of Convoy 
Servicing  Company  and  Agility  Fleet  Services,  LLC,  the  Company  expanded  its  dealership  network  of  Thermo  King  refrigeration 
systems for trucks, railroad cars, and other land transportation markets in Texas and Colorado.  In 2021, sales and service of Thermo 
King products comprised approximately 6% of the Company’s revenues.

United and S&S have maintained continuous exclusive distribution rights for MTU and Allison since the 1940s. United and S&S 
are two of MTU’s top five distributors of off-highway engines in North America, with exclusive distribution rights in multiple states. 
In addition, as distributors of Allison products, United and S&S have exclusive distribution rights in multiple key growth states. United 
and S&S are also the distributor for parts, service and warranty on Daimler truck engines and related equipment in multiple states. Sales 
and service of MTU, Allison, and Daimler products accounted for approximately 9% of the Company’s revenues during 2021. Although 
the  Company  considers  its  relationships  with  MTU,  Allison,  and  Daimler  to  be  strong,  the  loss  of  MTU,  Allison,  or  Daimler 
distributorships and service rights, or a disruption of the supply of MTU or Allison parts, could have a negative impact on the Company’s 
ability to service its customers.

In addition to its relationships with MTU, Allison, and Daimler, the Company also has relationships with many other distributors 
and parts suppliers and the loss of a distributorship and service rights, or a disruption of the supply of parts from any of these other 
distributors or part suppliers could also have a negative impact on the Company’s ability to service its customers.

General Corporate Risk Factors

The Company is subject to adverse weather conditions in its marine transportation and distribution and services segments. The 
Company’s marine transportation segment is subject to weather condition volatility.  Physical impacts of climate change could have a 
material adverse effect on the Company's costs and operations.  There has been public discussion that climate change may be associated 
with rising sea levels as well as extreme weather conditions such as more intense hurricanes, thunderstorms, tornadoes, drought, and 
snow or ice storms.  Extreme weather conditions may increase the Company's costs or cause damage to its facilities, and any damage 
resulting from extreme weather may not be fully insured.  Many of the Company's facilities are located near coastal areas or waterways 
where rising sea levels or flooding could disrupt the Company's operations or adversely impact its facilities.  Adverse weather conditions 
such as high or low water on the inland waterway systems, fog and ice, tropical storms, hurricanes, and tsunamis on both the inland 
waterway systems and throughout the United States coastal waters can impair the operating efficiencies of the marine fleet. Such adverse 

25

weather conditions can cause a delay, diversion or postponement of shipments of products and are totally beyond the control of the 
Company.  Tropical storms and hurricanes may also impact the Company’s customers resulting in reduced demand for the Company’s 
services. In addition, adverse water and weather conditions can negatively affect a towing vessel’s performance, tow size, loading drafts, 
fleet efficiency, limit navigation periods and dictate horsepower requirements. The Company’s distribution and services segment is also 
subject to tropical storms and hurricanes impacting its coastal locations and those of its customers as well as tornados impacting its 
Oklahoma facilities. The risk of flooding as a result of hurricanes and tropical storms as well as other weather events may impede travel 
via  roadways,  suspend  service  work,  and  impact  deliveries  and  the  Company’s  ability  to  fulfill  orders  or  provide  services  in  the 
distribution and services segment.   

The Company may be unable to make attractive acquisitions or successfully integrate acquired businesses, and any inability to do 
so may adversely affect the Company’s business and hinder its ability to grow. The Company has made asset and business acquisitions 
in the past and may continue to make acquisitions of assets or businesses in the future that complement or expand the Company’s current 
business. The Company may not be able to identify attractive acquisition opportunities. Even if attractive acquisition opportunities are 
identified, the Company may not be able to complete the acquisition or do so on commercially acceptable terms. The success of any 
completed acquisition depends on the Company’s ability to integrate the acquired assets or business effectively into the Company’s 
existing operations. The process of integrating acquired assets or businesses may involve difficulties that require a disproportionate 
amount of the Company’s managerial and financial resources to resolve. The value of acquired assets or businesses may be negatively 
impacted by a variety of circumstances unknown to the Company prior to the acquisition. In addition, possible future acquisitions may 
be larger and for purchase prices significantly higher than those paid for earlier acquisitions. No assurance can be given that the Company 
will be able to identify additional suitable acquisition opportunities, negotiate acceptable terms, obtain financing for acquisitions on 
acceptable terms or successfully acquire identified targets. The Company’s failure to achieve synergies, to integrate successfully the 
acquired businesses and assets into the Company’s existing operations, or to minimize any unforeseen operational difficulties could 
have  a  material  adverse  effect  on  the  Company’s  business,  financial  condition,  and  results  of  operations.  In  addition,  agreements 
governing  the  Company’s  indebtedness  from  time  to  time  may  impose  certain  limitations  on  the  Company’s  ability  to  undertake 
acquisitions or make investments or may limit the Company’s ability to incur certain indebtedness and liens, which could limit the 
Company’s ability to make acquisitions.

The Company’s failure to comply with the Foreign Corrupt Practices Act (“FCPA”), or similar local applicable anti-bribery laws, 
could have a negative impact on its ongoing operations. The Company’s operations outside the United States require the Company to 
comply with both United States and international regulations. For example, in addition to any similar applicable local anti-bribery laws, 
the Company's operations in countries outside the United States are subject to the FCPA, which prohibits United States companies or 
their employees and third party representatives from providing anything of value to a foreign official for the purposes of influencing 
any  act  or  decision  of  these  individuals  in  their  official  capacity  to  help  obtain  or  retain  business,  direct  business  to  any  person  or 
corporate entity, or obtain any unfair advantage. The Company has internal control policies and procedures and has implemented training 
and compliance programs for its employees and third party representatives with respect to the FCPA. However, the Company’s policies, 
procedures  and  programs  may  not  always  protect  it  from  reckless  or  criminal  acts  committed  by  its  employees  or  third  party 
representatives, and severe criminal or civil sanctions could be the result of violations of the FCPA or any other applicable anti-bribery 
law in countries where the Company does business. The Company is also subject to the risks that its employees, joint venture partners, 
and third party representatives outside of the United States may fail to comply with other applicable laws.

The  Company  is  subject  to  risks  associated  with  possible  climate  change  legislation,  regulation  and  international  accords. 
Greenhouse  gas  emissions,  including  carbon  emissions  or  energy  use,  have  increasingly  become  the  subject  of  a  large  amount  of 
international, national, regional, state and local attention. Pursuant to an April 2007 decision of the United States Supreme Court, the 
EPA was required to consider if carbon dioxide was a pollutant that endangers public health. On December 7, 2009, the EPA issued its 
“endangerment  finding”  regarding  greenhouse  gasses  under  the  CAA.  The  EPA  found  that  the  emission  of  six  greenhouse  gases, 
including carbon dioxide (which is emitted from the combustion of fossil fuels), may reasonably be anticipated to endanger public health 
and welfare. Based on this finding, the EPA defined the mix of these six greenhouse gases to be “air pollution” subject to regulation 
under the CAA. Although the EPA has stated a preference that greenhouse gas regulation be based on new federal legislation rather than 
the existing CAA, many sources of greenhouse gas emissions may be regulated without the need for further legislation.

The United States Congress has considered in the past legislation that would create an economy-wide “cap-and-trade” system that 
would establish a limit (or cap) on overall greenhouse gas emissions and create a market for the purchase and sale of emissions permits 
or “allowances.” Any proposed cap-and-trade legislation would likely affect the chemical industry due to anticipated increases in energy 
costs as fuel providers pass on the cost of the emissions allowances, which they would be required to obtain under cap-and-trade to 
cover the emissions from fuel production and the eventual use of fuel by the Company or its energy suppliers. In addition, cap-and-trade 
proposals would likely increase the cost of energy, including purchases of diesel fuel, steam and electricity, and certain raw materials 
used or transported by the Company. Proposed domestic and international cap-and-trade systems could materially increase raw material 
and operating costs of the Company’s customer base. Future environmental regulatory developments related to climate change in the 
United States that restrict emissions of greenhouse gases could result in financial impacts on the Company’s operations that cannot be 
predicted with certainty at this time.

26

In  addition,  current  global  trends  incorporating  carbon  neutral  policies  and  reduction  in  greenhouse  gas  emissions  are  driving 
decarbonization initiatives across all industries to mitigate the impact on climate change and may result in a decline in global and U.S. 
hydrocarbon usage.  Such a decline in hydrocarbon usage (for example, as a result of an increase in electric vehicles) could result in a 
reduction in demand for (a) the Company’s services in its marine transportation segment to the extent there is reduced demand for crude 
oil and other feedstocks used and the products produced by the Company’s major refining customers and (b) for the Company’s products 
and  services  in  its  distribution  and  services  segment  to  the  extent  there  is  reduced  demand  in  the  exploration  and  production  of 
hydrocarbons by the Company’s oil and gas customers.  

Loss of a large customer could adversely affect the Company. Five marine transportation customers accounted for approximately 
17% of the Company’s 2021, 18% of 2020 and 19% of 2019 revenue. The Company has contracts with these customers expiring in 
2022 through 2026. Three distribution and services customers accounted for approximately 6% of the Company’s 2021 revenue, 3% of 
2020 revenue, and 12% of 2019 revenue. Although the Company considers its relationships with these companies to be strong, the loss 
of any of these customers, or their inability to meet financial obligations, could have an adverse effect on the Company.

The Company relies on critical operating assets including information systems for the operation of its businesses, and the failure 
of such assets or any critical information system, including as a result of natural disasters, terrorist acts, a cybersecurity attack, or 
other  extraordinary  events,  may  adversely  impact  its  businesses.  The  Company  is  dependent  on  its  critical  operating  assets  and 
technology infrastructure and must maintain and rely upon critical information systems and security of its assets for the effective and 
safe operation of its businesses. These assets include vessels, vessel equipment, property and facilities, as well as information systems, 
such as software applications, hardware equipment, and data networks and telecommunications.

The Company’s critical assets and information systems, including the Company’s proprietary vessel management computer system, 
are subject to damage or interruption from a number of potential sources, including but not limited to, natural disasters, terrorist acts, 
cybersecurity  attacks,  software  viruses,  and  power  failures.  In  addition  to  standard  safety  operating  procedures,  the  Company  has 
implemented measures such as business continuity plans, hurricane preparedness plans, emergency recovery processes, and security 
preparedness plans to protect physical assets and to recover from damage to such assets.  The Company has also implemented virus 
protection software, intrusion detection systems and annual attack and penetration audits to protect information systems to mitigate these 
risks. However, the Company cannot guarantee that its critical assets or information systems cannot be damaged or compromised.

Any damage or compromise of its critical assets or data security or its inability to use or access these critical assets and information 
systems could adversely impact the efficient and safe operation of its businesses, or result in the failure to safely operate its equipment, 
and maintain the confidentiality of data of its customers or its employees and could subject the Company to increased operating expenses 
or legal action, which could have an adverse effect on the Company.

Limitations  on  the  Company's  ability  to  obtain,  maintain,  protect,  or  enforce  its  proprietary  information  and  any  successful 
intellectual property challenges or infringement proceedings, including its trade secrets could affect the Company's competitive position.  
The Company's distribution and services businesses rely on a variety of intellectual property rights for its product and services.  The 
Company’s intellectual property could be adversely affected by successful intellectual property challenges or infringement proceedings 
against it which could materially and adversely affect its competitive position. The Company may also be adversely affected when its 
patents  are  unenforceable,  where  claims  allowed  are  not  sufficient  to  protect  its  technology  or  its  trade  secrets  are  not  adequately 
protected.  The Company's failure to protect its proprietary information and any successful challenges to the Company's intellectual 
property rights could have an adverse effect on the Company.

A deterioration of the Company’s credit profile, disruptions of the credit markets or higher interest rates could restrict its ability 
to access the debt capital markets or increase the cost of debt.  Deterioration in the Company’s credit profile may have an adverse effect 
on the Company’s ability to access the private or public debt markets and also may increase its borrowing costs. If the Company’s credit 
profile deteriorates significantly its access to the debt capital markets or its ability to renew its committed lines of credit may become 
restricted, its cost of debt may increase, or the Company may not be able to refinance debt at the same levels or on the same terms. 
Because the Company relies on its ability to draw on its Revolving Credit Facility to support its operations as needed, any volatility in 
the credit and financial markets that prevents the Company from accessing funds on acceptable terms could have an adverse effect on 
the Company’s financial condition and cash flows. Additionally, the pricing grids on Company’s Revolving Credit Facility and Term 
Loan  contain  a  ratings  grid  that  includes  a  possible  increase  in  borrowing  rates  if  the  Company’s  rating  declines.  Furthermore,  the 
Company  incurs  interest  under  its  Revolving  Credit  Facility  based  on  floating  rates.  Floating  rate  debt  creates  higher  debt  service 
requirements  if  market  interest  rates  increase,  which  would  adversely  affect  the  Company’s  cash  flow  and  results  of  operations.  In 
addition, as the floating rate on certain borrowings under the Revolving Credit Facility is tied to LIBOR, the uncertainty regarding the 
future of LIBOR as well as the transition from LIBOR to an alternate benchmark rate or rates could adversely affect the Company’s 
financing costs.

27

Continuing  widespread  health  developments,  government  imposed  COVID-19  vaccine  and/or  testing  mandates,  and  economic 
uncertainty resulting from the global COVID-19 pandemic could materially and adversely affect our business, financial condition and 
results  of  operations.    In  December  2019,  COVID-19  surfaced  in  Wuhan,  China.    In  response  to  the  resulting  pandemic,  various 
countries,  including  the  United  States,  either  mandated  or  recommended  business  closures,  travel  restrictions  or  limitations,  social 
distancing, and/or self-quarantine, among other restrictions.  Additionally, various state and local governments in locations where the 
Company operates took similar actions.  The situation continues to evolve as additional variants of the virus appear.  Governments have 
removed, eased, reinstated, or implemented new restrictions in response to changing levels of infection and hospitalization rates.  The 
full extent and duration of these impacts is unknown at this time, but there has been and continues to be a negative impact on the global 
and United States economies and supply chains, including the oil and gas industry, which has created delays and reduced demand for 
the Company’s products and services and in some cases, resulted in delays in performance of its contracts with customers.

These impacts  could  continue to  place limitations on  the  Company’s  ability to execute  on its business  plan  and  materially  and 
adversely affect its business, financial condition and results of operations.  Additionally, the Company may be exposed to legal liabilities 
as a result of, or arising out of, the impacts of COVID-19, such as allegations of breach of contract, failure to comply with governmental 
requirements, and employment related claims, among others.  The Company continues to monitor the developments related to COVID-
19, adapt its policies and procedures to address the situation, including its pandemic response plan and business continuity plan, and 
review contract and other legal risk.  The Company also took steps to reduce costs.  The impact of the COVID-19 pandemic may also 
exacerbate other risks discussed above, any of which could have a material effect on the Company.  This situation continues to evolve 
and additional impacts may arise that the Company is not aware of currently.

Item 1B. Unresolved Staff Comments

Not applicable.

Item 2. Properties

The information appearing in Item 1 under “Marine Transportation– Properties” and “Distribution and Services– Properties” is 
incorporated herein by reference. The Company believes that its facilities are adequate for its needs and additional facilities would be 
available if required.

Item 3. Legal Proceedings

See Note 14, Contingencies and Commitments to the Company’s financial statements.

Item 4. Mine Safety Disclosures

Not applicable.

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

The Company’s common stock is traded on the New York Stock Exchange under the symbol KEX.

As  of  February 17,  2022,  the  Company  had  60,201,000  outstanding  shares  held  by  approximately  480  stockholders  of  record; 

however, the Company believes the number of beneficial owners of common stock exceeds this number.

The Company does not have an established dividend policy. Decisions regarding the payment of future dividends will be made by 
the Board of Directors based on the facts and circumstances that exist at that time. Since 1989, the Company has not paid any dividends 
on its common stock. The Company’s credit agreements contain covenants restricting the payment of dividends by the Company at any 
time when there is a default under the agreements.

Item 6. Reserved

28

Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Statements contained in this Form 10-K that are not historical facts, including, but not limited to, any projections contained herein, 
are forward-looking statements and involve a number of risks and uncertainties.  Such statements involve risks and uncertainties.  Such 
statements can be identified by the use of forward-looking terminology such as “may,” “will,” “expect,” “anticipate,” “estimate,” or 
“continue,”  or  the  negative  thereof  or  other  variations  thereon  or  comparable  terminology.  The  actual  results  of  the  future  events 
described  in  such  forward-looking  statements  in  this  Form  10-K  could  differ  materially  from  those  stated  in  such  forward-looking 
statements. Among the factors that could cause actual results to differ materially are: adverse economic conditions, industry competition 
and other competitive factors, adverse weather conditions such as high water, low water, tropical storms, hurricanes, tsunamis, fog and 
ice, tornados, COVID-19 or other pandemics, marine accidents, lock delays, fuel costs, interest rates, construction of new equipment by 
competitors, government and environmental laws and regulations, and the timing, magnitude and number of acquisitions made by the 
Company. For a more detailed discussion of factors that could cause actual results to differ from those presented in forward-looking 
statements,  see  Item  1A-Risk  Factors.  Forward-looking  statements  are  based  on  currently  available  information  and  the  Company 
assumes no obligation to update any such statements.

For  purposes  of  Management’s  Discussion,  all  net  earnings  per  share  attributable  to  Kirby  common  stockholders  are  “diluted 
earnings (loss) per share.” The weighted average number of common shares outstanding applicable to diluted earnings (loss) per share 
for 2021, 2020, and 2019 were 60,053,000, 59,912,000, and 59,909,000, respectively.  Refer to the Company's Annual Report on Form 
10-K for the year ended December 31, 2020 for management's discussion and analysis of financial condition and results of operations 
for 2020 compared to 2019.

Overview

The Company is the nation’s largest domestic tank barge operator, transporting bulk liquid products throughout the Mississippi 
River  System,  on  the  Gulf  Intracoastal  Waterway,  and  coastwise  along  all  three  United  States  coasts.  The  Company  transports 
petrochemicals, black oil, refined petroleum products and agricultural chemicals by tank barge.  Through its distribution and services 
segment, the Company provides after-market service and parts for engines, transmissions, reduction gears, and related equipment used 
in  oilfield  services,  marine,  power  generation,  on-highway,  and  other  industrial  applications.  The  Company  also  rents  equipment 
including generators, industrial compressors, and high capacity lift trucks, and refrigeration trailers for use in a variety of industrial 
markets, and manufactures and remanufactures oilfield service equipment, including pressure pumping units, manufactures cementing 
and  pumping  equipment  as  well  as  coil  tubing  and  well  intervention  equipment,  electric  power  generation  equipment,  specialized 
electrical distribution and control equipment, and high capacity energy storage/battery systems for oilfield service customers.

The following table summarizes key operating results of the Company (in thousands, except per share amounts):

Total revenues
Net earnings (loss) attributable to Kirby
Net earnings (loss) per share attributable to Kirby common stockholders – 
diluted
Net cash provided by operating activities
Capital expenditures

$
$

$
$
$

2021
2,246,660
$
(246,954) $

Year Ended December 31,
2020
2,171,408
$
(272,546) $

(4.11) $
$
$

321,576
98,015

(4.55) $
$
$

444,940
148,185

2019
2,838,399
142,347

2.37
511,813
248,164

The 2021 third quarter included $340,713,000 before taxes, $275,068,000 after taxes, or $4.58 per share, non-cash charges related 
to  impairment  of  long-lived  assets  related  to  coastal  marine  transportation  equipment  and  impairment  of  goodwill  in  the  marine 
transportation segment.  See Note 7, Impairments and Other Charges in the financial statements for additional information.  The 2021 
fourth quarter was also impacted by a one-time deferred tax provision of $5,656,000 or $0.09 per share related to a change in Louisiana 
tax law.  See Note 9, Taxes on Income for additional information.

The 2020 first quarter included $561,274,000 before taxes, $433,341,000 after taxes, or $7.24 per share, non-cash charges related 
to inventory write-downs, impairment of long-lived assets, including intangible assets and property and equipment, and impairment of 
goodwill in the distribution and services segment.  See Note 7, Impairments and Other Charges for additional information.  In addition, 
the 2020 first quarter was favorably impacted by an income tax benefit of $50,824,000, or $0.85 per share related to net operating losses 
generated in 2018 and 2019 used to offset taxable income generated between 2013 and 2017.  See Note 9, Taxes on Income for additional 
information.  

The 2019 fourth quarter included $35,525,000 before taxes, $27,978,000 after taxes, or $0.47 per share, non-cash inventory write-

downs and $4,757,000 before taxes, $3,747,000 after taxes, or $0.06 per share, severance and early retirement expense.

29

Cash  provided  by  operating  activities  in  2021  decreased  primarily  due  to  lower  revenues  and  operating  income  in  the  marine 
transportation segment, partially offset by the receipt of a tax refund of $119,493,000, including accrued interest, for the Company's 
2019 federal tax return.  During 2021, capital expenditures of $98,015,000 included $84,353,000 in the marine transportation segment 
and $13,662,000 in the distribution and services segment and corporate, more fully described under cash flow and capital expenditures 
below.

The Company projects that capital expenditures for 2022 will be in the $170,000,000 to $190,000,000 range.  The 2022 construction 
program will consist of approximately $5,000,000 for the construction of new inland towboats, $145,000,000 to $155,000,000 primarily 
for  maintenance  capital  and  improvements  to  existing  marine  equipment  and  facilities,  and  $20,000,000  to  $30,000,000  for  new 
machinery and equipment, facilities improvements, and information technology projects in the distribution and services segment and 
corporate.  Included in the Company’s construction program is capital spending of approximately $11,000,000 for the construction of a 
diesel-electric towboat and repowering existing towboats expected to reduce emissions as compared to conventional engine systems of 
the  Company’s  marine  fleet.    The  Company  has  applied  for  and  been  awards  grants  from  various  government  entities  totaling 
approximately $3,800,000 related to certain of these emission reduction projects which it expects to receive reimbursements for in 2023.

The Company’s debt-to-capitalization ratio decreased to 28.7% at December 31, 2021 from 32.2% at December 31, 2020, primarily 
due to repayments under the Revolving Credit Facility and Term Loan in 2021, partially offset by a decrease in total equity, primarily 
due to the net loss attributable to Kirby of $246,954,000.  The Company’s debt outstanding as of December 31, 2021 and December 31, 
2020 is detailed in Long-Term Financing below.

Marine Transportation

The following table summarizes the Company’s marine transportation fleet:

December 31,

2021

2020

Inland tank barges:

Owned
Leased
Total
Barrel capacity (in millions)

Active inland towboats (quarter average):

Owned
Chartered
Total

Coastal tank barges:

Owned
Leased
Total
Barrel capacity (in millions)

Coastal tugboats:

Owned
Chartered
Total

Offshore dry-bulk cargo barges (owned)
Offshore tugboats and docking tugboat (owned and chartered)

983
42
1,025
22.9

211
44
255

30
1
31
3.1

26
3
29

4
5

1,015
51
1,066
24.1

210
38
248

43
1
44
4.2

40
4
44

4
5

The Company also owns shifting operations and fleeting facilities for dry cargo barges and tank barges on the Houston Ship Channel 
and in Freeport and Port Arthur, Texas, and Lake Charles, Louisiana, and a shipyard for building towboats and performing routine 
maintenance near the Houston Ship Channel, as well as a two-thirds interest in Osprey Line, L.L.C., which transports project cargoes 
and cargo containers by barge.

During 2021, the Company retired 36 inland tank barges and returned five leased barges.  The net result was a decrease of 41 inland 

tank barges and approximately 1,210,000 barrels of capacity.

30

For 2021, 59% of the Company’s revenues were generated by its marine transportation segment. The segment’s customers include 
many of the major petrochemical and refining companies that operate in the United States. Products transported include intermediate 
materials used to produce many of the end products used widely by businesses and consumers — plastics, fibers, paints, detergents, oil 
additives and paper, among others, as well as residual fuel oil, ship bunkers, asphalt, gasoline, diesel fuel, heating oil, crude oil, natural 
gas  condensate  and  agricultural  chemicals.  Consequently,  the  Company’s  marine  transportation  business  is  directly  affected  by  the 
volumes produced by the Company’s petroleum, petrochemical and refining customer base.

The  Company’s  marine  transportation  segment’s  revenues  for  2021  decreased  6%  compared  to  2020  and  operating  income 
decreased 61%, compared to 2020. The decreases for 2021 were primarily due to reduced term and spot pricing in the inland market 
when compared to 2020.  The decrease in revenues was partially offset by the increase in the price of diesel fuel and the addition of the 
Savage Inland Marine, LLC (“Savage”) fleet acquired on April 1, 2020.  Revenues and operating income in 2021 were impacted by 
Hurricane Ida which shut down almost the entire Southeast Louisiana refinery and chemical complex and key waterways for an extended 
period of time during the third quarter.  Winter Storm Uri also heavily impacted the 2021 first quarter with the shutdown of many Gulf 
Coast refineries and chemical plants for an extended period of time starting in mid-February. These emergency shutdowns resulted in 
significantly reduced liquids production and lower volumes for the Company’s inland marine transportation market during the 2021 first 
quarter.  The 2021 and 2020 first quarters were also impacted by poor operating conditions including seasonal wind and fog along the 
Gulf Coast, flooding on the Mississippi River, and various lock closures along the Gulf Intracoastal Waterway, in addition to ice on the 
Illinois River during the 2021 first quarter and increased shipyard days on large capacity coastal vessels during the 2020 first quarter.  
For 2021 and 2020, the inland tank barge fleet contributed 76% and 78%, respectively, and the coastal fleet contributed 24% and 22%, 
respectively, of marine transportation revenues.

During 2021 and 2020, reduced demand as a result of the COVID-19 pandemic and the resulting economic slowdown contributed 
to lower barge utilization. Inland tank barge utilization levels averaged in the mid-70% range during the 2021 first quarter, the low to 
mid-80% range during the 2021 second quarter, the low 80% range during the 2021 third quarter, and the mid-to high 80% range during 
the 2021 fourth quarter.  The 2021 first quarter was impacted by reduced volumes as a result of Winter Storm Uri, whereas the 2021 
second quarter was favorably impacted by the Colonial Pipeline outage in May.  Subsequently, the third quarter was negatively impacted 
by Hurricane Ida.  For 2020, inland tank barge utilization levels averaged in the low to mid-90% range during the first quarter, the mid-
80% range during the second quarter, the low 70% range during the third quarter, and the high 60% range during the fourth quarter.  
The 2020 first quarter experienced strong demand from petrochemicals, black oil, and refined petroleum products customers prior to the 
onset of COVID-19.  In addition, extensive delay days due to poor operating conditions and lock maintenance projects in the 2020 first 
quarter slowed the transport of customer cargoes and contributed to strong barge utilization.

Coastal tank barge utilization levels averaged in the mid-70% range during the 2021 first quarter, the low to mid-70% range during 
the 2021 second quarter, the mid-70% range during the 2021 third quarter, and the 90% range during the 2021 fourth quarter.  The 
increase in coastal tank barge utilization during the 2021 fourth quarter was primarily due to the retirement of underutilized barges in 
the 2021 third quarter.  In 2020, coastal tank barge utilization levels averaged in the low to mid-80% range during the first quarter and 
the mid-70% range during each of the second, third, and fourth quarters. Barge utilization in the coastal marine fleet continued to be 
impacted by the oversupply of tank barges in the coastal industry during 2021 and 2020.

During both 2021 and 2020, approximately 65% of the inland marine transportation revenues were under term contracts and 35% 
were spot contract revenues.  These allocations provide the operations with a reasonably predictable revenue stream. Inland time charters, 
which  insulate  the  Company  from  revenue  fluctuations  caused  by  weather  and  navigational  delays  and  temporary  market  declines, 
represented  58%  of  the  inland  revenues  under  term  contracts  during  2021  compared  to  66%  during  2020.    During  2021  and  2020, 
approximately 80% and 85%, respectively, of the coastal revenues were under term contracts and 20% and 15%, respectively, were spot 
contract revenues. Coastal time charters represented approximately 85% of coastal revenues under term contracts during 2021 compared 
to 90% during 2020.  Term contracts have contract terms of 12 months or longer, while spot contracts have contract terms of less than 
12 months.

31

The following table summarizes the average range of pricing changes in term and spot contracts renewed during 2021 compared to 

contracts renewed during the corresponding quarter of 2020:

Inland market:

Term increase (decrease)
Spot increase (decrease)

Coastal market (a):

Term increase (decrease)
Spot increase (decrease)

March 31, 2021

June 30, 2021

September 30, 2021

December 31, 2021

Three Months Ended

(7)% – (9)%
(25)% – (30)%

(6)% – (8)%
(10)% – (15)%

(2)% – (4)%
No change

No change
No change

No change
No change

No change
No change

10%
7% – 9%

No change
No change

(a) Spot and term contract pricing in the coastal market are contingent on various factors including geographic location, vessel 

capacity, vessel type, and product serviced.

Effective January 1, 2021, annual escalators for labor and the producer price index on a number of inland multi-year contracts 

resulted in rate increases on those contracts of approximately 3%, excluding fuel.

The 2021 marine transportation operating margin was 4.8% compared to 11.7% for 2020.

Distribution and Services

The  Company,  through  its  distribution  and  services  segment,  sells  genuine  replacement  parts,  provides  service  mechanics  to 
overhaul and repair engines, transmissions, reduction gears and related oilfield services equipment, rebuilds component parts or entire 
diesel engines, transmissions and reduction gears, and related equipment used in oilfield services, marine, power generation, on-highway 
and other industrial applications. The Company also rents equipment including generators, industrial compressors, and high capacity 
lift trucks, and refrigeration trailers for use in a variety of industrial markets, and manufactures and remanufactures oilfield service 
equipment,  including  pressure  pumping  units,  manufactures  cementing  and  pumping  equipment  as  well  as  coil  tubing  and  well 
intervention  equipment,  electric  power  generation  equipment,  specialized  electrical  distribution  and  control  equipment,  and  high 
capacity energy storage/battery systems for oilfield service customers.  The Company sells and manufactures various products, including 
those  used  in  hydraulic  fracturing  and  refrigeration  systems,  used  in  oil  and  gas  and  industrial  applications  that,  as  compared  to 
conventional products, reduce emissions.  These products made up approximately 10% of distribution and services segment revenues in 
2021.

During 2021, the distribution and services segment generated 41% of the Company’s revenues, of which 88% was generated from 
service and parts and 12% from manufacturing. The results of the distribution and services segment are largely influenced by cycles of 
the oilfield service industry and oil and gas operator and producer markets, marine, power generation, on-highway and other industrial 
markets.

Distribution and services revenues for 2021 increased 20% compared to 2020 and operating income increased 326% compared to 
2020.    In  the  commercial  and  industrial  market,  the  increases  in  2021  compared  to  2020  were  primarily  attributable  to  improved 
economic activity across the U.S. which resulted in higher business levels in the power generation and on-highway businesses.  Increased 
product sales in Thermo King also contributed favorably to the 2021 results.  The marine repair business was down slightly compared 
to 2020 due to reduced service activity.  The commercial and industrial market 2021 results were also impacted by Winter Storm Uri 
with reduced activity levels at many locations across the Southern U.S. during the first quarter.  For 2021 and 2020, the commercial and 
industrial market contributed 63% and 74%, respectively, of the distribution and services revenues.

In the oil and gas market, revenues improved compared to 2020 due to higher oilfield activity which resulted in increased demand 
for new and overhauled engines, transmissions, parts, and service.  The manufacturing business also experienced increases in orders and 
deliveries of new and remanufactured pressure pumping equipment as well as power generation equipment for electric fracturing.  For 
2021 and 2020, the oil and gas market contributed 37% and 26%, respectively, of the distribution and services revenues. 

The distribution and services operating margin for 2021 was 3.0% compared to (1.6)% for 2020.

Outlook

Although there are still some uncertainties surrounding the COVID-19 Omicron variant which is currently impacting the Company's 
operations, the Company expects both the marine transportation and distribution and services segments to deliver improved financial 
results in 2022.

32

The inland marine transportation market is expected to have favorable market conditions in 2022 with improved demand driven by 
continued economic growth, increased volumes from new petrochemical plants, and minimal new barge construction across the industry.  
Barge utilization is expected to range between the high 80% range and low 90% range, with an improving spot market, which currently 
represents approximately 35% of inland revenues.  Term contracts renewed lower during the first three quarters of 2021, but rebounded 
in the fourth quarter and should reset higher during 2022 to reflect improved market conditions.  Overall for 2022, inland revenues are 
expected to improve year-on-year with steady growth throughout the year as business improves and contracts renew.  However, growth 
in the first quarter is expected to be modest due to the impact of winter weather and the COVID-19 Omicron variant which is causing 
crewing challenges, lost revenue, and incremental costs.  Operating margins are expected to improve in 2022, with the first quarter being 
the lowest.  

As of December 31, 2021, the Company estimated there were approximately 4,000 inland tank barges in the industry fleet, of which 
approximately 385 were 30 years old or older and approximately 280 of those were 40 years old or older. The Company estimates that 
approximately 5 to 10 new tank barges have currently been ordered for delivery in 2022 and expects a number of older tank barges will 
be retired, dependent on 2022 market conditions. Historically, 75 to 150 older inland tank barges are retired from service each year 
industry-wide.  The extent of the retirements is dependent on petrochemical and refinery production levels, and crude oil and natural 
gas condensate movements, both of which can have a direct effect on industry-wide tank barge utilization, as well as term and spot 
contract rates.  

In the coastal marine transportation market, customer demand is expected to modestly improve in 2022 as refined products and 
black  oil  transportation  volumes  continue  to  recover  from  the  impact  of  the  pandemic.    However,  pricing  is  expected  to  remain 
challenged due to underutilized barge capacity across the industry.  The Company's coastal barge utilization is expected to be in the 
90% range in 2022, driven primarily by modest improvement in the spot market and the Company's retirement of underutilized tank 
barges during the 2021 third quarter.  Coastal revenues in 2022 are expected to decrease modestly compared to 2021, with the impact 
of the Company's exit from the Hawaii market and anticipated reductions in coal shipments being partially offset by modest improvement 
in spot market utilization.  The 2022 first quarter is expected to be impacted by lost revenue and crewing issues related to the Omicron 
variant, and subsequent quarters are expected to be impacted by planned shipyard maintenance and ballast water treatment installations 
on certain vessels.  Coastal operating margins during 2022 are expected to be similar to 2021 or slightly improved. 

As  of  December 31,  2021,  the  Company  estimated  there  were  approximately  270  coastal  tank  barges  operating  in  the  195,000 
barrels or less industry fleet, the sector of the market in which the Company operates, and approximately 20 of those were over 25 years 
old. The Company is not aware of any new coastal tank barges that have been ordered.  

The results of the distribution and services segment are largely influenced by the cycles of the oilfield service industry and oil and 
gas operator and producer markets, marine, power generation, on-highway and other industrial markets.  Economic growth and strong 
oilfield fundamentals in 2022 are expected to improve activity levels and contribute to a sizeable year-over-year increase in revenues.  
In the commercial and industrial market, improving economic conditions and growth in key markets are expected to yield 2022 revenue 
growth with increased activity in power generation, marine repair, and on-highway. 

In the distribution and services oil and gas market, higher commodity prices and increasing well completions activity are expected 
to  improve  demand  for  products  and  services  in  the  distribution  business.    In  manufacturing,  a  heightened  customer  focus  on 
sustainability and the Company's current backlog for environmentally friendly pressure pumping and power generation equipment for 
electric fracturing is expected to result in significant revenue growth.  However, due to ongoing supply chain issues, new equipment 
deliveries are expected to ramp slowly with the 2022 first quarter being the lowest of the year.  Overall, operating margins in distribution 
and services are expected to improve as the year progresses.  Operating margins for the 2022 first quarter are expected to be the lowest 
of the year due to the timing of projects and ongoing supply chain delays.

While  the  Company's  outlook  is  dependent  on  developments  regarding  the  COVID-19  pandemic  and  related  supply  chain 

constraints, the Company has maintained business continuity and expects to continue to do so.

Critical Accounting Policies and Estimates

The  preparation  of  financial  statements  in  conformity  with  United  States  generally  accepted  accounting  principles  requires 
management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial 
statements and the reported amounts of revenues and expenses during the reporting period. The Company evaluates its estimates and 
assumptions on an ongoing basis based on a combination of historical information and various other assumptions that are believed to be 
reasonable  under  the  particular  circumstances.  Actual  results  may  differ  from  these  estimates  based  on  different  assumptions  or 
conditions. The Company believes the critical accounting policies that most impact the consolidated financial statements are described 
below. It is also suggested that the Company’s significant accounting policies, as described in the Company’s financial statements in 
Note  1,  Summary  of  Significant  Accounting  Policies,  be  read  in  conjunction  with  this  Management’s  Discussion  and  Analysis  of 
Financial Condition and Results of Operations.

33

Accounts  Receivable.  The  Company  extends  credit  to  its  customers  in  the  normal  course  of  business.  The  Company  regularly 
reviews its accounts and estimates the amount of uncollectible receivables each period and establishes an allowance for uncollectible 
amounts.  The  amount  of  the  allowance  is  based  on  the  age  of  unpaid  amounts,  information  about  the  current  financial  strength  of 
customers, and other relevant information. Estimates of uncollectible amounts are revised each period, and changes are recorded in the 
period  they  become  known.  Historically,  credit  risk  with  respect  to  these  trade  receivables  has  generally  been  considered  minimal 
because of the financial strength of the Company’s customers; however, a United States or global recession or other adverse economic 
condition could impact the collectability of certain customers’ trade receivables which could have a material effect on the Company’s 
results of operations.

Property,  Maintenance  and  Repairs.  Property  is  recorded  at  cost;  improvements  and  betterments  are  capitalized  as  incurred. 
Depreciation is recorded using the straight-line method over the estimated useful lives of the individual assets. When property items are 
retired, sold, or otherwise disposed of, the related cost and accumulated depreciation are removed from the accounts with any gain or 
loss on the disposition included in the statement of earnings. Maintenance and repairs on vessels built for use on the inland waterways 
are charged to operating expense as incurred and includes the costs incurred in USCG inspections unless the shipyard extends the life 
or improves the operating capacity of the vessel which results in the costs being capitalized. The Company’s ocean-going vessels are 
subject to regulatory drydocking requirements after certain periods of time to be inspected, have planned major maintenance performed 
and be recertified by the ABS. These recertifications generally occur twice in a five-year period. The Company defers the drydocking 
expenditures incurred on its ocean-going vessels due to regulatory marine inspections by the ABS and amortizes the costs of the shipyard 
over the period between drydockings, generally 30 or 60 months, depending on the type of major maintenance performed. Drydocking 
expenditures that extend the life or improve the operating capability of the vessel result in the costs being capitalized. Routine repairs 
and maintenance on ocean-going vessels are expensed as incurred. Interest is capitalized on the construction of new ocean-going vessels.

The Company performs an impairment assessment whenever events or changes in circumstances indicate that the carrying amount 
of long-lived assets may not be recoverable. If a triggering event is identified, the Company compares the carrying amount of the asset 
group to the estimated undiscounted future cash flows expected to result from the use of the asset group. If the carrying amount of the 
asset group exceeds the estimated undiscounted future cash flows, the Company measures the amount of the impairment by comparing 
the carrying amount of the asset group to its estimated fair value.  Assets to be disposed of are reported at the lower of the carrying 
amount or fair value less costs to sell. There are many assumptions and estimates underlying the determination of an impairment event 
or loss, if any. The assumptions and estimates include, but are not limited to, estimated fair market value of the assets and estimated 
future cash flows expected to be generated by these assets, which are based on additional assumptions such as asset utilization, length 
of  service  the  asset  will  be  used,  and  estimated  salvage  values.  Although  the  Company  believes  its  assumptions  and  estimates  are 
reasonable, deviations from the assumptions and estimates could produce a materially different result.

Goodwill. The excess of the purchase price over the fair value of identifiable net assets acquired in transactions accounted for as a 
purchase  is  included  in  goodwill.  Management  monitors  the  recoverability  of  goodwill  on  an  annual  basis,  or  whenever  events  or 
circumstances indicate that interim impairment testing is necessary. The amount of goodwill impairment, if any, is typically measured 
based  on  projected  discounted  future  operating  cash  flows  using  an  appropriate  discount  rate  and  valued  based  on  the  excess  of  a 
reporting unit’s carrying amount over its fair value, incorporating all tax impacts caused by the recognition of the impairment loss. The 
assessment of the recoverability of goodwill will be impacted if estimated future operating cash flows are not achieved. There are many 
assumptions and estimates underlying the determination of an impairment event or loss, if any. Although the Company believes its 
assumptions and estimates are reasonable, deviations from the assumptions and estimates could produce a materially different result.

Accrued Insurance. The Company is subject to property damage and casualty risks associated with operating vessels carrying large 
volumes of bulk liquid and dry cargo in a marine environment. The Company maintains insurance coverage against these risks subject 
to  a  deductible,  below  which  the  Company  is  liable.  In  addition  to  expensing  claims  below  the  deductible  amount  as  incurred,  the 
Company also maintains a reserve for losses that may have occurred but have not been reported to the Company, or are not yet fully 
developed.  The  Company  uses  historic  experience  and  actuarial  analysis  by  outside  consultants  to  estimate  an  appropriate  level  of 
accrued liabilities. If the actual number of claims and magnitude were substantially greater than assumed, the required level of accrued 
liabilities for claims incurred but not reported or fully developed could be materially understated. The Company records receivables 
from its insurers for incurred claims above the Company’s deductible. If the solvency of the insurers became impaired, there could be 
an adverse impact on the accrued receivables and the availability of insurance.

Acquisitions

During 2021, the Company purchased four inland tank barges from a leasing company for $7,470,000 in cash.  The Company had 

been leasing the barges prior to the purchase.

On October 4, 2021, the Company paid $1,645,000 in cash to purchase assets of an energy storage systems manufacturer based in 

Texas which have been key to the development of new power generation solutions for electric fracturing equipment.

34

During 2020, the Company purchased six newly constructed inland pressure barges for $39,350,000 in cash.

On  April  1,  2020,  the  Company  completed  the  acquisition  of  the  inland  tank  barge  fleet  of  Savage  for  $278,999,000  in  cash. 
Savage’s tank barge fleet consisted of 92 inland tank barges with approximately 2.5 million barrels of capacity and 45 inland towboats.  
The  Savage  assets  that  were  acquired  primarily  move  petrochemicals,  refined  products,  and  crude  oil  on  the  Mississippi  River,  its 
tributaries,  and  the  Gulf  Intracoastal  Waterway.    The  Company  also  acquired  Savage’s  ship  bunkering  business  and  barge  fleeting 
business along the Gulf Coast.

On January 3, 2020, the Company completed the acquisition of substantially all the assets of Convoy for $37,180,000 in cash.  
Convoy is an authorized dealer for Thermo King refrigeration systems for trucks, railroad cars and other land transportation markets for 
North and East Texas and Colorado.

During the year ended December 31, 2019, the Company purchased, from various counterparties, a barge fleeting operation in Lake 
Charles, Louisiana and nine inland tank barges from leasing companies for an aggregate of $17,991,000 in cash. The Company had been 
leasing the barges prior to the purchases.

On March 14, 2019, the Company completed the acquisition of the marine transportation fleet of Cenac for $244,500,000 in cash. 
Cenac’s fleet consisted of 63 inland 30,000 barrel tank barges with approximately 1,833,000 barrels of capacity, 34 inland towboats and 
two offshore tugboats. Cenac transported petrochemicals, refined products and black oil, including crude oil, residual fuels, feedstocks 
and lubricants on the lower Mississippi River, its tributaries, and the Gulf Intracoastal Waterway for major oil companies and refiners. 
The average age of the inland tank barges was approximately five years and the inland towboats had an average age of approximately 
seven years.  

Financing of these purchases and acquisitions was through borrowings under the Company’s Revolving Credit Facility and cash 

provided by operating activities.

Results of Operations

The following table sets forth the Company’s marine transportation and distribution and services revenues and the percentage of 

each to total revenues for the comparable periods (dollars in thousands):

Marine transportation
Distribution and services

Marine Transportation

2021
$ 1,322,918
923,742
$ 2,246,660

%

Year Ended December 31,

2020

%

2019

%

59% $ 1,404,265
767,143
41
100% $ 2,171,408

65% $ 1,587,082
1,251,317
35
100% $ 2,838,399

56%
44
100%

The following table sets forth a year over year comparison of the Company’s marine transportation segment’s revenues, costs and 

expenses, operating income and operating margins (dollars in thousands):

Marine transportation revenues

Costs and expenses:

Costs of sales and operating expenses
Selling, general and administrative
Taxes, other than on income
Depreciation and amortization

Operating income
Operating margins

2021
$ 1,322,918

2020
$ 1,404,265

Year Ended December 31,
% Change

2019

% Change

(6)% $ 1,587,082

(12)%

924,380
119,017
30,527
185,979
1,259,903
63,015

$

907,119
111,182
35,528
186,798
1,240,627
163,638

$

4.8%

11.7%

2
7
(14)
—
2

(61)% $

1,034,758
122,202
34,538
179,742
1,371,240
215,842

13.6%

(12)
(9)
3
4
(10)
(24)%

35

 
 
The  following  table  shows  the  marine  transportation  markets  serviced  by  the  Company,  the  marine  transportation  revenue 

distribution, products moved and the drivers of the demand for the products the Company transports: 

Markets Serviced

Petrochemicals

2021 Revenue 
Distribution
50%

Black Oil

Refined Petroleum Products

Agricultural Chemicals

26%

20%

4%

2021 Compared to 2020 

Marine Transportation Revenues

Products Moved
Benzene, Styrene, Methanol, Acrylonitrile, 
Xylene, Naphtha, Caustic Soda, Butadiene, 
Propylene
Residual Fuel Oil, Coker Feedstock, 
Vacuum Gas Oil, Asphalt, Carbon Black 
Feedstock, Crude Oil, Natural Gas 
Condensate, Ship Bunkers
Gasoline, No. 2 Oil, Jet Fuel, Heating Oil, 
Diesel Fuel, Ethanol
Anhydrous Ammonia, Nitrogen-Based 
Liquid Fertilizer, Industrial Ammonia

Drivers

Consumer non-durables — 70% 
Consumer durables — 30%

Fuel for Power Plants and Ships, 
Feedstock for Refineries, Road 
Construction

Vehicle Usage, Air Travel, Weather 
Conditions, Refinery Utilization
Corn, Cotton and Wheat Production, 
Chemical Feedstock Usage

Marine transportation revenues for 2021 decreased 6% compared to 2020. The decrease for 2021 was primarily due to reduced term 
and spot pricing in the inland market when compared to 2020.  The decrease was partially offset by the increase in the price of diesel 
fuel and the addition of the Savage fleet acquired on April 1, 2020.  Revenues in 2021 were impacted by Hurricane Ida which shut down 
almost the entire Southeast Louisiana refinery and chemical complex and key waterways for an extended period of time during the third 
quarter.  Winter Storm Uri also heavily impacted the 2021 first quarter with the shutdown of many Gulf Coast refineries and chemical 
plants for an extended period of time starting in mid-February. These emergency shutdowns resulted in significantly reduced liquids 
production and lower volumes for the Company’s inland marine transportation market during the 2021 first quarter.  The 2021 and 2020 
first quarters were also impacted by poor operating conditions including seasonal wind and fog along the Gulf Coast, flooding on the 
Mississippi River, and various lock closures along the Gulf Intracoastal Waterway, in addition to ice on the Illinois River during the 
2021 first quarter and increased shipyard days on large capacity coastal vessels during the 2020 first quarter.  For 2021 and 2020, the 
inland tank barge fleet contributed 76% and 78%, respectively, and the coastal fleet contributed 24% and 22%, respectively, of marine 
transportation revenues.

During 2021 and 2020, reduced demand as a result of the COVID-19 pandemic and the resulting economic slowdown contributed 
to lower barge utilization. Inland tank barge utilization levels averaged in the mid-70% range during the 2021 first quarter, the low to 
mid-80% range during the 2021 second quarter, the low 80% range during the 2021 third quarter, and the mid-to high 80% range during 
the 2021 fourth quarter.  The 2021 first quarter was impacted by reduced volumes as a result of Winter Storm Uri, whereas the 2021 
second quarter was favorably impacted by the Colonial Pipeline outage in May.  Subsequently, the third quarter was negatively impacted 
by Hurricane Ida.  For 2020, inland tank barge utilization levels averaged in the low to mid-90% range during the first quarter, the mid-
80% range during the second quarter, the low 70% range during the third quarter, and the high 60% range during the fourth quarter.    
The 2020 first quarter experienced strong demand from petrochemicals, black oil, and refined petroleum products customers prior to the 
onset of COVID-19.  In addition, extensive delay days due to poor operating conditions and lock maintenance projects in the 2020 first 
quarter slowed the transport of customer cargoes and contributed to strong barge utilization.

Coastal tank barge utilization levels averaged in the mid-70% range during the 2021 first quarter, the low to mid-70% range during 
the 2021 second quarter, the mid-70% range during the 2021 third quarter, and the 90% range during the 2021 fourth quarter.    The 
increase in coastal tank barge utilization during the 2021 fourth quarter was primarily due to the retirement of underutilized barges in 
the 2021 third quarter.  In 2020, coastal tank barge utilization levels averaged in the low to mid-80% range during the first quarter and 
the mid-70% range during each of the second, third, and fourth quarters. Barge utilization in the coastal marine fleet continued to be 
impacted by the oversupply of tank barges in the coastal industry during 2021 and 2020.

The petrochemical market, the Company’s largest market, contributed 50% of marine transportation revenues for 2021, reflecting 
reduced volumes from Gulf Coast petrochemical plants for both domestic consumption and to terminals for export destinations as a 
result of the COVID-19 pandemic.  During the 2021 first quarter, as much as 80% of U.S. chemical plant capacity was offline at the 
peak of Winter Storm Uri, contributing to significantly reduced volumes and revenues; however, volumes and revenues sequentially 
improved  in  the  2021  second  quarter  as  chemical  plants  resumed  full  operations  by  May.    During  the  2021  third  quarter,  volumes 
declined again as numerous Louisiana chemical plants were shut down for an extended period of time as a result of Hurricane Ida.  

36

The black oil market, which contributed 26% of marine transportation revenues for 2021, reflected reduced demand as refinery 
production levels and the export of refined petroleum products and fuel oils declined as a result of the COVID-19 pandemic.  During 
the 2021 first quarter, U.S. refinery utilization dropped to near 40% during the peak of Winter Storm Uri, contributing to significantly 
reduced volumes and revenues.  Although refinery utilization increased back to near 90% in the 2021 second quarter contributing to 
sequentially increased volumes and revenues, volumes declined again during the 2021 third quarter as Louisiana refineries were shut 
down for an extended period of time as a result of Hurricane Ida.  During 2021, the Company continued to transport crude oil and natural 
gas condensate produced from the Permian Basin as well as reduced volumes from the Eagle Ford shale formation in Texas, both along 
the  Gulf  Intracoastal  Waterway  with  inland  vessels  and  in  the  Gulf  of  Mexico  with  coastal  equipment.  Additionally,  the  Company 
transported volumes of Utica natural gas condensate downriver from the Mid-Atlantic to the Gulf Coast and Canadian and Bakken crude 
downriver from the Midwest to the Gulf Coast.  

The refined petroleum products market, which contributed 20% of marine transportation revenues for 2021, reflected lower volumes 
in both the inland and coastal markets as a result of reduced demand related to the COVID-19 pandemic.  In addition, during the 2021 
first quarter, U.S. refinery utilization dropped to near 40% during the peak of Winter Storm Uri, contributing to significantly reduced 
volumes and revenues.  Although refinery utilization increased back to near 90% in the 2021 second quarter contributing to sequentially 
increased volumes and revenues, volumes declined again during the 2021 third quarter as Louisiana refineries were shut down for an 
extended period of time as a result of Hurricane Ida.  

The agricultural chemical market, which contributed 4% of marine transportation revenues for 2021, saw modest reductions in 
demand for transportation of both domestically produced and imported products, primarily due to reduced demand associated with the 
COVID-19 pandemic.

For 2021, the inland operations incurred 9,605 delay days, 8% fewer than the 10,408 delay days that occurred during 2020.  Delay 
days measure the lost time incurred by a tow (towboat and one or more tank barges) during transit when the tow is stopped due to 
weather, lock conditions, or other navigational factors.  Delay days for 2021 and 2020 were impacted by hurricanes and tropical storms, 
poor operating conditions due to heavy wind and fog along the Gulf Coast, high water conditions on the Mississippi River System, and 
closures of key waterways, including the Gulf Intracoastal Waterway, due in part to lock maintenance projects.

During both 2021 and 2020, approximately 65% of the inland marine transportation revenues were under term contracts and 35% 
were spot contract revenues.  These allocations provide the operations with a reasonably predictable revenue stream. Inland time charters, 
which  insulate  the  Company  from  revenue  fluctuations  caused  by  weather  and  navigational  delays  and  temporary  market  declines, 
represented  58%  of  the  inland  revenues  under  term  contracts  during  2021  compared  to  66%  during  2020.    During  2021  and  2020, 
approximately 80% and 85%, respectively, of the coastal revenues were under term contracts and 20% and 15%, respectively, were spot 
contract revenues. Coastal time charters represented approximately 85% of coastal revenues under term contracts during 2021 compared 
to 90% during 2020.

The following table summarizes the average range of pricing changes in term and spot contracts renewed during 2021 compared to 

contracts renewed during the corresponding quarter of 2020:

Inland market:

Term increase (decrease)
Spot increase (decrease)

Coastal market (a):

Term increase (decrease)
Spot increase (decrease)

March 31, 2021

June 30, 2021

September 30, 2021

December 31, 2021

Three Months Ended

(7)% – (9)%
(25)% – (30)%

(6)% – (8)%
(10)% – (15)%

(2)% – (4)%
No change

No change
No change

No change
No change

No change
No change

10%
7% – 9%

No change
No change

(a) Spot and term contract pricing in the coastal market are contingent on various factors including geographic location, vessel 

capacity, vessel type, and product serviced.

Effective January 1, 2021, annual escalators for labor and the producer price index on a number of inland multi-year contracts 

resulted in rate increases on those contracts of approximately 3%, excluding fuel.

Marine Transportation Costs and Expenses

Total costs and expenses for 2021 increased 2% compared to 2020.  Costs of sales and operating expenses for 2021 increased 2% 
compared to 2020 primarily due to increased fuel costs, partially offset by cost reductions across the segment, including a reduction in 
towboats operated during 2021.

37

The inland marine transportation fleet operated an average of 250 towboats during 2021, of which an average of 35 were chartered, 
compared  to  287  during  2020,  of  which  an  average  of  52  were  chartered.  The  decrease  was  primarily  due  to  reduced  horsepower 
requirements as a result of a smaller barge fleet, crewing issues associated with the COVID-19 Delta and Omicron variants, and reduced 
activity as a result of the impacts of Winter Storm Uri and Hurricane Ida.  Generally, variability in demand or anticipated demand, as 
tank barges are added to or removed from the fleet, as chartered towboat availability changes, or as weather or water conditions dictate, 
the  Company  charters  in  or  releases  chartered  towboats  in  an  effort  to  balance  horsepower  needs  with  current  requirements.  The 
Company has historically used chartered towboats for approximately one-fourth of its horsepower requirements.

During 2021, the inland operations consumed 46.8 million gallons of diesel fuel compared to 47.5 million gallons consumed during 
2020. The average price per gallon of diesel fuel consumed during 2021 was $2.13 per gallon compared to $1.41 per gallon for 2020.  
Fuel  escalation  and  de-escalation  clauses  are  typically  included  in  term  contracts  and  are  designed  to  rebate  fuel  costs  when  prices 
decline and recover additional fuel costs when fuel prices rise; however, there is generally a 30 to 90 day delay before contracts are 
adjusted. Spot contracts do not have escalators for fuel.

Selling, general and administrative expenses for 2021 increased 7% compared to 2020.  The increase is primarily due to higher 

incentive compensation accruals, medical costs, legal costs, and professional fees.

Taxes, other than on income, for 2021 decreased 14% compared to 2020.  The decrease is primarily due to lower property taxes on 

marine transportation equipment.

Depreciation and amortization for 2021 decreased slightly compared to 2020.  The decrease was primarily due to retirements of 

marine equipment, partially offset by the full year impact of the Savage fleet which was acquired in April 2020.

Marine Transportation Operating Income and Operating Margins

Marine transportation operating income for 2021 decreased 61% compared to 2020.  The operating margin was 4.8% for 2021 
compared to 11.7% for 2020.  The decreases in operating income and operating margin were primarily due to decreased term and spot 
contract pricing in the inland market, as a result of a reduction in demand due to the COVID-19 pandemic and reduced volumes as a 
result of Hurricane Ida and Winter Storm Uri.  Operating margin for 2021 was also impacted by the increased cost of diesel fuel.

Distribution and Services

The following table sets forth a year over year comparison of the Company’s distribution and services segment’s revenues, costs 

and expenses, operating income (loss) and operating margins (dollars in thousands):

Distribution and services revenues

Costs and expenses:

Costs of sales and operating expenses
Selling, general and administrative
Taxes, other than on income
Depreciation and amortization

Operating income (loss)
Operating margins

2021
$ 923,742

2020
767,143

$

Year Ended December 31,
% Change

2019

% Change

20% $ 1,251,317

(39)%

728,855
141,100
5,607
20,573
896,135
27,607

$

604,238
140,449
6,392
28,255
779,334
(12,191)

$

21
—
(12)
(27)
15
326% $

995,288
145,473
7,357
35,998
1,184,116
67,201

(39)
(3)
(13)
(22)
(34)
(118)%

3.0%

(1.6)%

5.4%

The following table shows the markets serviced by the Company, the revenue distribution, and the customers for each market:

Markets Serviced

Commercial and Industrial

2021 Revenue 
Distribution
63%

Oil and Gas

37%

Customers

Inland River Carriers — Dry and Liquid, Offshore Towing — Dry and 
Liquid, Offshore Oilfield Services — Drilling Rigs & Supply Boats, Harbor 
Towing, Dredging, Great Lakes Ore Carriers, Pleasure Crafts, On and Off-
Highway Transportation, Power Generation, Standby Power Generation, 
Pumping Stations
Oilfield Services, Oil and Gas Operators and Producers

38

 
2021 Compared to 2020

Distribution and Services Revenues

Distribution and services revenues for 2021 increased 20% compared to 2020.  In the commercial and industrial market, the increase 
was primarily attributable to improved economic activity across the U.S. which resulted in higher business levels in the power generation 
and on-highway businesses.  Increased product sales in Thermo King also contributed favorably to the 2021 results.  The marine repair 
business was down slightly compared to 2020 due to reduced service activity.  The commercial and industrial market 2021 results were 
also impacted by Winter Storm Uri with reduced activity levels at many locations across the Southern U.S. during the first quarter.  For 
2021 and 2020, the commercial and industrial market contributed 63% and 74%, respectively, of the distribution and services revenues.

The oil and gas market revenues increase compared to 2020 primarily due to higher oilfield activity which resulted in increased 
demand for new and overhauled engines, transmissions, parts, and service.  The manufacturing business also experienced increases in 
orders  and  deliveries  of  new  and  remanufactured  pressure  pumping  equipment  as  well  as  power  generation  equipment  for  electric 
fracturing.  For 2021 and 2020, the oil and gas market contributed 37% and 26%, respectively, of the distribution and services revenues. 

Distribution and Services Costs and Expenses

Total costs and expenses for 2021 increased 15% compared to 2020 reflecting the 21% increase in costs of sales and operating 
expenses, reflecting higher demand in the on-highway and power generation businesses in the commercial and industrial markets in 
2021.    The  increase  also  reflects  higher  demand  for  new  and  overhauled  transmissions  and  related  parts  and  service  and  increased 
demand for new pressure pumping equipment in the oil and gas market.

Selling, general and administrative expenses for 2021 increased slightly compared to 2020.  The increase was primarily due to 
increased incentive compensation accruals during 2021, medical costs, and warranty costs, partially offset by a bad debt expense charge 
of $3,339,000 as a result of the bankruptcy of a large oil and gas customer, and $1,354,000 of severance expense as a result of continued 
workforce reductions, each recorded during the 2020 second quarter.

Depreciation and amortization for 2021 decreased 27% compared to 2020.  The decrease was primarily due to lower amortization 
of intangible assets other than goodwill, which had been impaired during the 2020 first quarter and certain equipment and leasehold 
improvements acquired from Stewart & Stevenson LLC that became fully depreciated during 2020 and 2021.

Distribution and Services Operating Income (Loss) and Operating Margins

Operating income for the distribution and services segment for 2021 increased 326% compared to 2020.  The operating margin was 
3.0% for 2021 compared to (1.6)% for 2020. The results reflect increased business levels in both the commercial and industrial and oil 
and gas markets and a return to profitability, partially offset by higher costs and expenses due to increased activity levels.

General Corporate Expenses

General  corporate  expenses  for  2021,  2020,  and  2019  were  $13,803,000,  $11,050,000  and  $13,643,000,  respectively.    General 
corporate expenses were higher in 2021 than 2020 primarily due to higher incentive compensation accruals and costs related to Hurricane 
Ida.

Gain on Disposition of Assets

The  Company  reported  net  gains  on  disposition  of  assets  of  $5,761,000,  $118,000,  and  $8,152,000  in  2021,  2020,  and  2019, 
respectively.  The net gains were predominantly from the sales or retirements of marine equipment and distribution and services facilities.

Other Income and Expenses

The following table sets forth a year over year comparison of impairments and other charges, other income, noncontrolling interests, 

and interest expense (dollars in thousands):

Impairments and other charges
Other income
Noncontrolling interests
Interest expense

2021
(340,713) $
$
10,001
(183) $
(42,469) $

$
$
$
$

39

Year Ended December 31,
% Change

2020
(561,274)
8,147
(954)
(48,739)

(39)% $
23% $
(81)% $
(13)% $

2019
(35,525)
3,787
(672)
(55,994)

% Change

1,480%
115%
42%
(13)%

Impairments and Other Charges

For 2021, impairments and other charges includes $340,713,000 before taxes, $275,068,000 after taxes, or $4.58 per share, non-
cash charges related to impairment of long-lived assets related to coastal marine transportation equipment and impairment of goodwill 
in the marine transportation segment.

For 2020, impairments and other charges includes $561,274,000 before taxes, $433,341,000 after taxes, or $7.24 per share, non-
cash charges related to inventory write-downs, impairment of long-lived assets, including intangible assets and property and equipment, 
and impairment of goodwill in the distribution and services segment. 

See Note 7, Impairments and Other Charges for additional information.

Other Income

Other income for 2021, 2020, and 2019 includes income of $8,175,000, $6,186,000 and $3,454,000, respectively, for all components 

of net benefit costs except the service cost component related to the Company’s defined benefit plans.

Interest Expense

The following table sets forth average debt, average interest rate, and capitalized interest excluded from interest expense (dollars in 

thousands):

Average debt
Average interest rate
Capitalized interest

2021
1,293,446

Year Ended December 31,
2020
1,567,523

$

$

3.2%
— $

3.1%
— $

$

$

2019
1,502,044

3.7%

1,003

Interest expense for 2021 decreased 13% compared to 2020, primarily due to lower average debt outstanding as a result of debt 

repayments since the 2020 first quarter.

(Provision) Benefit for Taxes on Income

On November 13, 2021, the voters of the state of Louisiana approved a constitutional amendment that removed the corporate tax 
deduction for federal income taxes paid and lowered the corporate income tax rate from 8% to 7.5% effective January 1, 2022.  The 
result of the amendment was an increase in the effective Louisiana state income tax rate, net of deduction for federal income tax, from 
6.3% to 7.5%.  As a result of the amendment, the Company recognized a one-time deferred tax provision of $5,656,000 during the fourth 
quarter of 2021 due to remeasuring the Company’s Louisiana and U.S. deferred tax assets and liabilities based on the new effective 
Louisiana state income tax rate.

During 2020, pursuant to provisions of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”), net operating 
losses generated during 2018 through 2020 were used to offset taxable income generated between 2013 through 2017.  Net operating 
losses carried back to tax years 2013 through 2017 were applied at the higher federal statutory tax rate of 35% compared to the statutory 
rate of 21% in effect at December 31, 2020.  The Company generated an effective tax rate benefit in 2020 as a result of such carrybacks.

40

Financial Condition, Capital Resources and Liquidity

Balance Sheet

The following table sets forth a year over year comparison of the significant components of the balance sheets (dollars in thousands):

Assets:

Current assets
Property and equipment, net
Operating lease right-of-use assets
Investment in affiliates
Goodwill
Other intangibles, net
Other assets

Liabilities and stockholders’ equity:

Current liabilities
Long-term debt, net — less current portion
Deferred income taxes
Operating lease liabilities — less current 
portion
Other long-term liabilities
Total equity

2021 Compared to 2020 

2021

2020

December 31,
% Change

2019

% Change

$

$

$

$

1,003,865 $
3,678,515
167,730
2,134
438,748
60,070
48,001
5,399,063 $

1,047,971
3,917,070
174,317
2,689
657,800
68,979
55,348
5,924,174

543,772 $

1,161,433
574,152

466,032
1,468,546
606,844

159,672
71,252
2,888,782
5,399,063 $

163,496
131,703
3,087,553
5,924,174

(4)% $
(6)
(4)
(21)
(33)
(13)
(13)
(9)% $

917,579
3,777,110
159,641
2,025
953,826
210,682
58,234
6,079,097

17% $
(21)
(5)

514,115
1,369,751
588,204

(2)
(46)
(6)
(9)% $

139,457
95,978
3,371,592
6,079,097

14%
4
9
33
(31)
(67)
(5)
(3)%

(9)%
7
3

17
37
(8)
(3)%

Current assets as of December 31, 2021 decreased 4% compared to December 31, 2020.  Trade accounts receivable increased 33% 
primarily due to increased business activity in both the marine transportation and distribution and services segments during the 2021 
fourth quarter, compared to the 2020 fourth quarter.  Other accounts receivable decreased 47%, primarily due to the receipt of a tax 
refund of $119,493,000 including accrued interest in 2021, for the Company's 2019 federal tax return.  Inventories increased by 7% 
primarily due to a buildup in the distribution and services segment for projects that will deliver in 2022.  Prepaid expenses and other 
current assets increased 21%, primarily due to the increase in the price of diesel fuel and the reclassification of certain coastal marine 
transportation equipment to held for sale.

Property and equipment, net of accumulated depreciation, at December 31, 2021 decreased 6% compared to December 31, 2020.  
The  decrease  reflected  $205,960,000  of  depreciation  expense,  $142,014,000  of  property  disposals,  including  the  sale  of  the  Hawaii 
marine transportation equipment, and retirement of underutilized equipment that was reclassified to held for sale, and $15,430,000 of 
impairment  charges  related  to  coastal  marine  transportation  equipment  held  and  used,  partially  offset  by  $116,648,000  of  capital 
additions (including an increase in accrued capital expenditures) and $8,201,000 primarily related to the acquisition of four inland tank 
barges during 2021, more fully described under Cash Flows and Capital Expenditures below.

Operating lease right-of-use assets as of December 31, 2021 decreased 4% compared to December 31, 2020, primarily due to lease 

amortization expense and impairment charges, partially offset by new leases acquired.

Goodwill as of December 31, 2021 decreased 33% compared to December 31, 2020, due to a goodwill impairment in the marine 

transportation segment.

Other intangibles, net, as of December 31, 2021 decreased 13% compared to December 31, 2020, primarily due to amortization.

Other assets as of December 31, 2021 decreased 13% compared to December 31, 2020, primarily due to amortization of drydock 

expenditures.

Current liabilities as of December 31, 2021 increased 17% compared to December 31, 2020. Accounts payable increased 23%, 
primarily  due  to  higher  business  activity  levels  and  an  increase  in  accrued  capital  expenditures.    Accrued  liabilities  increased  5%, 
primarily due to higher accrued incentive compensation during 2021 and higher warranty reserves.  Deferred revenues increased 60%, 
primarily due to deposits on equipment expected to be shipped in 2022 in the distribution and services segment.

41

 
 
Long-term debt, net – less current portion, as of December 31, 2021 decreased 21% compared to December 31, 2020, primarily 
reflecting repayments of $250,000,000 and $60,000,000 under the Revolving Credit Facility and Term Loan, respectively.  Net debt 
discounts and deferred issuance costs were $3,567,000 (excluding $1,403,000 attributable to the Revolving Credit Facility included in 
other assets on the balance sheet) at December 31, 2021 and $6,454,000 at December 31, 2020.

Deferred  income  taxes  as  of  December 31,  2021  decreased  5%  compared  to  December 31,  2020,  primarily  reflecting  the  2021 

deferred tax benefit of $44,419,000.

Operating lease liabilities – less current portion, as of December 31, 2021 decreased 2% compared to December 31, 2020, primarily 

due to lease payments made, partially offset by new leases acquired and liability accretion.

Other long-term liabilities as of December 31, 2021 decreased 46% compared to December 31, 2020, primarily due to amortization 
of intangible liabilities, a decrease in pension liabilities due to an improved funded position, and the payment of accrued payroll taxes 
deferred under provisions of the CARES Act.

Total equity as of December 31, 2021 decreased 6% compared to December 31, 2020, primarily due to a net loss attributable to 
Kirby of $246,954,000 for 2021 and tax withholdings of $2,856,000 on restricted stock and RSU vestings, partially offset by an increase 
in additional paid-in capital due to amortization of unearned share-based compensation of $15,713,000.

Retirement Plans

The Company sponsors a defined benefit plan for its inland vessel personnel and shore based tankermen. The plan benefits are 
based on an employee’s years of service and compensation. The plan assets consist primarily of equity and fixed income securities. The 
Company’s pension plan funding strategy is to make annual contributions in amounts equal to or greater than amounts necessary to meet 
minimum government funding requirements. No pension contributions were made in 2021, 2020 or 2019. The fair value of plan assets 
was $394,395,000 and $357,801,000 at December 31, 2021 and December 31, 2020, respectively.

On April 12, 2017, the Company amended its pension plan to cease all benefit accruals for periods after May 31, 2017 for certain 
participants. Participants grandfathered and not impacted were those, as of the close of business on May 31, 2017, who either (a) had 
completed  15  years  of  pension  service  or  (b)  had  attained  age  50  and  completed  10  years  of  pension  service.  Participants  non-
grandfathered are eligible to receive discretionary 401(k) plan contributions. 

On February 14, 2018, with the acquisition of Higman, the Company assumed Higman’s pension plan for its inland vessel personnel 
and office staff. On March 27, 2018, the Company amended the Higman pension plan to close it to all new entrants and cease all benefit 
accruals for periods after May 15, 2018 for all participants.  The Company made contributions to the Higman pension plan of $479,000 
in 2021, $797,000 in 2020 for the 2019 plan year, $1,438,000 in 2020 for the 2020 plan year, $1,615,000 in 2019 for the 2018 plan year, 
and $1,449,000 in 2019 for the 2019 plan year.  The fair value of plan assets was $36,426,000 and $37,336,000 at December 31, 2021 
and December 31, 2020, respectively.

The  Company’s  investment  strategy  focuses  on  total  return  on  invested  assets  (capital  appreciation  plus  dividend  and  interest 
income). The primary objective in the investment management of assets is to achieve long-term growth of principal while avoiding 
excessive risk. Risk is managed through diversification of investments within and among asset classes, as well as by choosing securities 
that have an established trading and underlying operating history.

The Company makes various assumptions when determining defined benefit plan costs including, but not limited to, the current 
discount rate and the expected long-term return on plan assets. Discount rates are determined annually and are based on a yield curve 
that consists of a hypothetical portfolio of high quality corporate bonds with maturities matching the projected benefit cash flows. The 
Company used discount rates of 3.0% for the Kirby pension plan and 3.1% for the Higman pension plan in 2021 and 2.8% for the Kirby 
pension plan and 2.9% for the Higman pension plan in 2020. The Company estimates that every 0.1% decrease in the discount rate 
results in an increase in the accumulated benefit obligation (“ABO”) of approximately $8,100,000. The Company assumed that plan 
assets would generate a long-term rate of return of 6.75% in both 2021 and 2020. The Company developed its expected long-term rate 
of return assumption by evaluating input from investment consultants and comparing historical returns for various asset classes with its 
actual and targeted plan investments. The Company believes that long-term asset allocation, on average, will approximate the targeted 
allocation.

42

Long-Term Financing

The following table summarizes the Company’s outstanding debt (in thousands): 

Long-term debt, including current portion:

Revolving Credit Facility due March 27, 2024 (a)
Term Loan due March 27, 2024 (a)
3.29% senior notes due February 27, 2023
4.2% senior notes due March 1, 2028
Credit line due June 30, 2022
Bank notes payable

Unamortized debt discount and issuance costs (b)

December 31,

2021

2020

— $

315,000
350,000
500,000
—
1,934
1,166,934
(3,567)
1,163,367

$

250,000
375,000
350,000
500,000
—
40
1,475,040
(6,454)
1,468,586

$

$

(a) Variable interest rate of 1.5% at both December 31, 2021 and 2020.
(b) Excludes $1,403,000 attributable to the Revolving Credit Facility included in other assets at December 31, 2021.

The  Company  has  an  amended  and  restated  credit  agreement  (“Credit  Agreement”)  with  a  group  of  commercial  banks,  with 
JPMorgan Chase Bank, N.A. as the administrative agent bank, allowing for an $850,000,000 revolving credit facility (“Revolving Credit 
Facility”) and an unsecured term loan (“Term Loan”) with a maturity date of March 27, 2024.  The Term Loan is due on March 27, 
2024 and is prepayable, in whole or in part, without penalty.  During 2021 and 2019, the Company repaid $60,000,000 and $125,000,000, 
respectively, under the Term Loan prior to the originally scheduled installments.  No prepayments were made in 2020.  The Revolving 
Credit Facility includes a $25,000,000 commitment which may be used for standby letters of credit. Outstanding letters of credit under 
the Revolving Credit Facility were $5,063,000 and available borrowing capacity was $844,937,000 as of December 31, 2021.

On February 3, 2022, the Company entered into a note purchase agreement for the issuance of $300,000,000 of unsecured senior 
notes with a group of institutional investors, consisting of $60,000,000 of 3.46% series A notes ("Series A Notes") and $240,000,000 of 
3.51% series B notes ("Series B Notes"), each due January 19, 2033 (collectively, the "2033 Notes").  The Series A Notes are scheduled 
to be issued on October 20, 2022, and the Series B Notes are scheduled to be issued on January 19, 2023.  No principal payments will 
be required until maturity. Beginning in 2023, interest payments of $5,250,000 will be due semi-annually on January 19 and July 19 of 
each year, with the exception of the first payment on January 19, 2023, which will be $525,000.  The 2033 Notes will be unsecured and 
rank equally in right of payment with the Company's other unsecured senior indebtedness.  The 2033 Notes contain certain covenants 
on the part of the Company, including an interest coverage covenant, a debt-to-capitalization covenant, and covenants relating to liens, 
asset sales and mergers, among others. The 2033 Notes also specify certain events of default, upon the occurrence of which the maturity 
of the notes may be accelerated, including failure to pay principal and interest, violation of covenants or default on other indebtedness, 
among others.  The Company intends to use the proceeds from the issuance of the 2033 Notes and cash provided by operations to repay 
the 3.29% senior unsecured notes due February 27, 2023.

On February 27, 2020, upon maturity, the Company repaid in full $150,000,000 of 2.72% unsecured senior notes.

Outstanding letters of credit under the $10,000,000 credit line were $1,299,000 and available borrowing capacity was $8,701,000 

as of December 31, 2021.

As of December 31, 2021, the Company was in compliance with all covenants under its debt instruments.  For additional information 

about the Company’s debt instruments, see Note 5, Long-Term Debt.

Cash Flow and Capital Expenditures

The Company generated net cash provided by operating activities of $321,576,000, $444,940,000, and $511,813,000 for the years 
ended December 31, 2021, 2020, and 2019, respectively.  During 2021, the 28% decrease was primarily due to lower revenues and 
operating income in the marine transportation segment, partially offset by a tax refund of $119,493,000, including accrued interest, for 
the  Company’s  2019  federal  tax  return,  increased  revenues  and  operating  income  in  the  distribution  and  services  segment,  reduced 
incentive compensation payouts, and the full year impact of revenues from the Savage fleet which was acquired in April 2020.  Decreases 
in marine transportation revenues and operating income were driven by decreased term and spot contract pricing in the inland market, 
each as a result of a reduction in demand due to the COVID-19 pandemic.  Marine transportation results in 2021 were also negatively 
impacted by Winter Storm Uri and Hurricane Ida.  The decrease in cash flows was also partially due to an increase in inventories in 
2021 compared to a decrease in 2020.  

43

 
 
During  2021,  2020,  and  2019,  the  Company  generated  cash  of  $51,342,000,  $17,310,000,  and  $57,657,000,  respectively,  from 
proceeds from the disposition of assets, and $629,000, $353,000, and $5,743,000, respectively, from proceeds from the exercise of stock 
options.

For 2021, cash generated was used for capital expenditures of $98,015,000 (net of an increase in accrued capital expenditures of 
$18,633,000), including $6,202,000 for inland towboat construction and $91,813,000 primarily for upgrading existing marine equipment 
and marine transportation and distribution and services facilities.  The Company also used $9,115,000 for acquisitions of businesses and 
marine equipment, more fully described under Acquisitions above.

For 2020, cash generated and borrowings under the Company’s Revolving Credit Facility were used for capital expenditures of 
$148,185,000,  (including  a  decrease  in  accrued  capital  expenditures  of  $13,280,000)  including  $7,506,000  for  inland  towboat 
construction  and  $140,679,000  primarily  for  upgrading  existing  marine  equipment  and  marine  transportation  and  distribution  and 
services facilities. The Company also used $354,972,000 for acquisitions of businesses and marine equipment, more fully described 
under Acquisitions above.

Treasury Stock Purchases

The  Company  did  not  purchase  any  treasury  stock  during  2021,  2020,  or  2019.    As  of  February 17,  2022,  the  Company  had 
approximately 1,400,000 shares available under its existing repurchase authorizations. Historically, treasury stock purchases have been 
financed through operating cash flows and borrowings under the Company’s Revolving Credit Facility. The Company is authorized to 
purchase its common stock on the New York Stock Exchange and in privately negotiated transactions. When purchasing its common 
stock, the Company is subject to price, trading volume and other market considerations. Shares purchased may be used for reissuance 
upon the exercise of stock options or the granting of other forms of incentive compensation, in future acquisitions for stock or for other 
appropriate corporate purposes.

Liquidity and Capital Resources

Funds generated from operations are available for acquisitions, capital expenditure projects, common stock repurchases, repayments 
of borrowings and for other corporate and operating requirements. In addition to net cash flow provided by operating activities, as of 
February 17, 2022, the Company had cash equivalents of $22,333,000, availability of $844,937,000 under its Revolving Credit Facility 
and $8,701,000 available under its Credit Line.

Neither  the  Company,  nor  any  of  its  subsidiaries,  is  obligated  on  any  debt  instrument,  swap  agreement,  or  any  other  financial 

instrument or commercial contract which has a rating trigger, except for pricing grids on its Credit Agreement.

The Company expects to continue to be able to fund expenditures for acquisitions, capital construction projects, common stock 
repurchases,  repayment  of  borrowings,  and  for  other  operating  requirements  both  in  the  short  term  and  in  the  long  term  from  a 
combination of available cash and cash equivalents, funds generated from operating activities, and available financing arrangements.

The Revolving Credit Facility’s commitment is in the amount of $850,000,000 and expires March 27, 2024. As of December 31, 
2021, the Company had $844,937,000 available under the Revolving Credit Facility. The 3.29% senior unsecured notes do not mature 
until February 27, 2023, and require no prepayments.  The Company intends to use the proceeds from the issuance of the 2033 Notes in 
October 2022 and January 2023 and cash provided by operations to repay the 3.29% senior unsecured notes upon maturity.  The 4.2% 
senior unsecured notes do not mature until March 1, 2028 and require no prepayments.  The Term Loan is due March 27, 2024 and is 
prepayable, in whole or in part, without penalty.

There  are  numerous  factors  that  may  negatively  impact  the  Company’s  cash  flow  in  2022.  For  a  list  of  significant  risks  and 
uncertainties that could impact cash flows, see Note 14, Contingencies and Commitments in the financial statements, and Item 1A — 
Risk Factors. Amounts available under the Company’s existing financing arrangements are subject to the Company continuing to meet 
the covenants of the credit facilities as described in Note 5, Long-Term Debt in the financial statements.

The Company has issued guaranties or obtained standby letters of credit and performance bonds supporting performance by the 
Company and its subsidiaries of contractual or contingent legal obligations of the Company and its subsidiaries incurred in the ordinary 
course of business. The aggregate notional value of these instruments is $19,357,000 at December 31, 2021, including $12,055,000 in 
letters of credit and $7,302,000 in performance bonds. All of these instruments have an expiration date within two years. The Company 
does not believe demand for payment under these instruments is likely and expects no material cash outlays to occur in connection with 
these instruments.

44

The Company’s marine transportation term contracts typically contain fuel escalation clauses, or the customer pays for the fuel. 
However, there is generally a 30 to 90 day delay before contracts are adjusted depending on the specific contract. In general, the fuel 
escalation clauses are effective over the long-term in allowing the Company to recover changes in fuel costs due to fuel price changes. 
However, the short-term effectiveness of the fuel escalation clauses can be affected by a number of factors including, but not limited to, 
specific terms of the fuel escalation formulas, fuel price volatility, navigating conditions, tow sizes, trip routing, and the location of 
loading and discharge ports that may result in the Company over or under recovering its fuel costs. The Company’s spot contract rates 
generally reflect current fuel prices at the time the contract is signed but do not have escalators for fuel.

The  Company  currently  leases  various  facilities  and  equipment  under  cancelable  and  noncancelable  operating  leases.  Future 
minimum  lease  payments  under  operating  leases  that  have  initial  noncancelable  lease  terms  in  excess  of  one  year  are  detailed  in 
Note 6, Leases.  Lease payments for towing vessels exclude non-lease components.  The Company estimates that non-lease components 
comprise approximately 70% of charter rental costs, related to towboat crew costs, maintenance and insurance.

The Company’s pension plan funding strategy is to make annual contributions in amounts equal to or greater than amounts necessary 
to meet minimum government funding requirements. The ABO is based on a variety of demographic and economic assumptions, and 
the pension plan assets’ returns are subject to various risks, including market and interest rate risk, making an accurate prediction of the 
pension plan contribution difficult resulting in the Company electing to only make an expected pension contribution forecast of one 
year.  As  of  December 31,  2021,  the  Company’s  pension  plan  funding  was  92%  of  the  pension  plans’  ABO,  including  the  Higman 
pension plan. The Company expects to make additional pension contributions of $145,000 in 2022.

While inflationary pressures have increased in 2021, during the last three years, 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 as noted above, can be passed through to its customers. Spot contract rates include the cost 
of fuel and are subject to market volatility. In the distribution and services segment, the cost of major components for large manufacturing 
orders is secured with suppliers at the time a customer order is finalized, which limits exposure to inflation.  The repair portion of the 
distribution and services segment is based on prevailing current market rates.

Accounting Standards

For a discussion of recently issued accounting standards, see Note 1, Summary of Significant Accounting Policies.

Item 7A. Quantitative and Qualitative Disclosures about Market Risk

The Company is exposed to risk from changes in interest rates on certain of its outstanding debt. The outstanding loan balances 
under the Company’s bank credit facilities bear interest at variable rates based on prevailing short-term interest rates in the United States 
and Europe. A 1% increase in variable interest rates would impact the 2021 interest expense by $3,150,000 based on balances outstanding 
at December 31, 2021, and would change the fair value of the Company’s debt by approximately 3%.

Item 8. Financial Statements and Supplementary Data

The response to this item is submitted as a separate section of this report (see Item 15, page 80 and pages 47 to 79 of this report).

Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

Not applicable.

45

Item 9A. Controls and Procedures

Disclosure Controls and Procedures. The Company’s management, with the participation of the Chief Executive Officer and the 
Chief  Financial  Officer,  has  evaluated  the  Company’s  disclosure  controls  and  procedures  (as  defined  in  Rule  13a-15(e)  under  the 
Securities Exchange Act of 1934 (“Exchange Act”)), as of December 31, 2021, as required by Rule 13a-15(b) under the Exchange Act. 
Based on that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that, as of December 31, 2021, the 
disclosure controls and procedures were effective to ensure that information required to be disclosed by the Company in the reports that 
it files or submits under the Exchange Act (i) is recorded, processed, summarized and reported within the time periods specified in the 
Securities and Exchange Commission’s rules and forms and (ii) is accumulated and communicated to the Company’s management, 
including  the  Chief  Executive  Officer  and  the  Chief  Financial  Officer,  as  appropriate  to  allow  timely  decisions  regarding  required 
disclosure.

Management’s  Annual  Report  on  Internal  Control  Over  Financial  Reporting.  Management  of  the  Company  is  responsible  for 
establishing and maintaining adequate internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act). 
The  Company’s  management,  with  the  participation  of  the  Chief  Executive  Officer  and  the  Chief  Financial  Officer,  evaluated  the 
effectiveness  of  the  Company’s  internal  control  over  financial  reporting  as  of  December 31,  2021  using  the  framework  in  Internal 
Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based 
on that evaluation, management concluded that the Company’s internal control over financial reporting was effective as of December 31, 
2021. KPMG LLP, the Company’s independent registered public accounting firm, has audited the Company’s internal control over 
financial reporting, as stated in their report which is included herein.

Because  of  its  inherent  limitations,  internal  control  over  financial  reporting  may  not  prevent  or  detect  misstatements.    Also, 
projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of 
changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Changes in Internal Control Over Financial Reporting. There were no changes in the Company’s internal control over financial 
reporting during the quarter ended December 31, 2021 that have materially affected, or are reasonably likely to materially affect, the 
Company’s internal control over financial reporting.

Item 9B. Other Information

Not applicable

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Not applicable

Items 10 Through 14.

PART III

The information for these items is incorporated by reference to the definitive proxy statement to be filed by the Company with the 
Commission  pursuant  to  Regulation  14A  within  120  days  of  the  close  of  the  fiscal  year  ended  December 31,  2021,  except  for  the 
information regarding executive officers which is provided under Item 1.

46

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors
Kirby Corporation:

Opinion on the Consolidated Financial Statements

We  have  audited  the  accompanying  consolidated  balance  sheets  of  Kirby  Corporation  and  subsidiaries  (the  Company)  as  of 
December 31, 2021 and 2020, the related consolidated statements of earnings, comprehensive income, stockholders’ equity, and cash 
flows  for  each  of  the  years  in  the  three-year  period  ended  December 31,  2021,  and  the  related  notes  (collectively,  the  consolidated 
financial statements). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position 
of the Company as of December 31, 2021 and 2020, and the results of its operations and its cash flows for each of the years in the three-
year period ended December 31, 2021, in conformity with U.S. generally accepted accounting principles.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), 
the Company’s internal control over financial reporting as of December 31, 2021, based on criteria established in Internal Control – 
Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated 
February 18, 2022 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.

Change in Accounting Principle

As discussed in Note 1 to the consolidated financial statements, the Company has changed its method of accounting for impairment of 
goodwill as of January 1, 2020 due to the adoption of Accounting Standards Update 2017-04, Intangibles-Goodwill and Other (Topic 
350): Simplifying the Test for Goodwill Impairment.

Basis for Opinion

These consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion 
on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are 
required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and 
regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit 
to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to 
error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial 
statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, 
on  a  test  basis,  evidence  regarding  the  amounts  and  disclosures  in  the  consolidated  financial  statements.  Our  audits  also  included 
evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation 
of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements 
that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are 
material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The 
communication of a critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, 
and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the 
accounts or disclosures to which it relates.

Evaluation of potential impairment indicators for offshore vessel classes

As  discussed  in  Note  1  to  the  consolidated  financial  statements,  the  Company  performs  an  impairment  assessment  when 
circumstances indicate that the carrying amount of its long-lived assets may not be recoverable. If a triggering event is identified, 
the Company compares the carrying amount of the asset group to the estimated undiscounted future cash flows expected to result 
from the use of the asset group. If the carrying amount of the asset group exceeds the estimated undiscounted future cash flows, the 
Company measures the amount of the impairment by comparing the carrying amount of the asset group to its estimated fair value. 
Recoverability of marine transportation assets is assessed based on vessel classes.

We identified the evaluation of potential impairment indicators for offshore vessel classes as a critical audit matter. Evaluating the 
Company’s judgments in determining whether there was a triggering event required a high degree of subjective auditor judgment.

The following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the 
operating effectiveness of certain internal controls related to the Company’s process to identify and assess triggering events that 

47

indicate  that  the  carrying  amount  of  an  offshore  vessel  class  may  not  be  recoverable.  This  included  controls  related  to  the 
consideration of forecasted to actual operating results and market conditions in the determination of a triggering event. We assessed 
the Company’s identification of triggering events by evaluating future expected revenues from executed contracts with customers. 
We compared data used by the Company in forecasting future revenues, noting that such data included both internal and external 
elements, to analyst and industry reports. We evaluated the Company’s responses related to the elements considered and whether 
the Company omitted any significant internal or external elements in its evaluation.

/s/ KPMG LLP

We have served as the Company’s auditor since 1992.

Houston, Texas
February 18, 2022

48

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors
Kirby Corporation:

Opinion on Internal Control Over Financial Reporting

We have audited Kirby Corporation and subsidiaries' (the Company) internal control over financial reporting as of December 31, 2021, 
based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations 
of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial 
reporting  as  of  December 31,  2021,  based  on  criteria  established  in  Internal  Control  –  Integrated  Framework  (2013)  issued  by  the 
Committee of Sponsoring Organizations of the Treadway Commission.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), 
the consolidated balance sheets of the Company as of December 31, 2021 and 2020, the related consolidated statements of earnings, 
comprehensive income, stockholders’ equity, and cash flows for each of the years in the three-year period ended December 31, 2021, 
and  the  related  notes  (collectively,  the  consolidated  financial  statements),  and  our  report  dated  February 18,  2022  expressed  an 
unqualified opinion on those consolidated financial statements.

Basis for Opinion

The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of 
the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal 
Control Over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting 
based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the 
Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange 
Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to 
obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. 
Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, 
assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control 
based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. 
We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control Over Financial Reporting

A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of 
financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting 
principles.  A  company’s  internal  control  over  financial  reporting  includes  those  policies  and  procedures  that  (1)  pertain  to  the 
maintenance  of  records  that,  in  reasonable  detail,  accurately  and  fairly  reflect  the  transactions  and  dispositions  of  the  assets  of  the 
company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in 
accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in 
accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention 
or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the 
financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections 
of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in 
conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ KPMG LLP

Houston, Texas
February 18, 2022

49

KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS

Current assets:

Cash and cash equivalents
Accounts receivable:

ASSETS

Trade — less allowance for doubtful accounts of $8,177 ($8,807 in 2020)
Other

Inventories — at lower of average cost or net realizable value
Prepaid expenses and other current assets

Total current assets

Property and equipment:

Marine transportation equipment
Land, buildings and equipment

Accumulated depreciation

Property and equipment — net

Operating lease right-of-use assets
Investment in affiliates
Goodwill
Other intangibles, net
Other assets

Total assets

LIABILITIES AND STOCKHOLDERS’ EQUITY

Current liabilities:

Bank notes payable
Income taxes payable
Accounts payable
Accrued liabilities:

Interest
Insurance premiums and claims
Employee compensation
Taxes — other than on income
Other

Current portion of operating lease liabilities
Deferred revenues

Total current liabilities

Long-term debt, net — less current portion
Deferred income taxes
Operating lease liabilities — less current portion
Other long-term liabilities

Total long-term liabilities

Contingencies and commitments

Equity:

Kirby stockholders’ equity:

Common stock, $0.10 par value per share. Authorized 120,000,000 shares, issued 65,472,000
Additional paid-in capital
Accumulated other comprehensive income — net
Retained earnings
Treasury stock — at cost, 5,361,000 shares in 2021 and 5,434,000 shares in 2020

Total Kirby stockholders’ equity

Noncontrolling interests

Total equity
Total liabilities and equity

December 31,

2021

2020

($ in thousands)

$

34,813

$

80,338

417,958
149,964
331,350
69,780
1,003,865

4,789,994
602,857
5,392,851
(1,714,336)
3,678,515
167,730
2,134
438,748
60,070
48,001
5,399,063

1,934
—
199,088

11,379
111,117
39,331
44,740
29,511
33,902
72,770
543,772
1,161,433
574,152
159,672
71,252
1,966,509

$

$

315,283
284,899
309,675
57,776
1,047,971

4,999,777
615,623
5,615,400
(1,698,330)
3,917,070
174,317
2,689
657,800
68,979
55,348
5,924,174

40
474
162,507

11,272
111,359
32,918
44,366
24,940
32,750
45,406
466,032
1,468,546
606,844
163,496
131,703
2,370,589

—

—

6,547
854,512
(25,966)
2,346,439
(295,208)
2,886,324
2,458
2,888,782
5,399,063

$

6,547
844,979
(61,452)
2,593,393
(299,161)
3,084,306
3,247
3,087,553
5,924,174

$

$

$

See accompanying notes to consolidated financial statements.

50

 
KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF EARNINGS

2021

Year Ended December 31,
2020
($ in thousands, except per share amounts)

2019

Revenues:

Marine transportation
Distribution and services

Total revenues

Costs and expenses:

Costs of sales and operating expenses
Selling, general and administrative
Taxes, other than on income
Depreciation and amortization
Impairments and other charges
Gain on disposition of assets
Total costs and expenses
Operating income (loss)

Other income
Interest expense

Earnings (loss) before taxes on income

(Provision) benefit for taxes on income

Net earnings (loss)

Less: Net earnings attributable to noncontrolling interests

Net earnings (loss) attributable to Kirby

Net earnings (loss) per share attributable to Kirby common stockholders:

Basic
Diluted

$

$

1,322,918
923,742
2,246,660

$

1,404,265
767,143
2,171,408

1,587,082
1,251,317
2,838,399

1,652,961
266,911
36,251
213,718
340,713
(5,761)
2,504,793
(258,133)
10,001
(42,469)
(290,601)
43,830
(246,771)
(183)
(246,954) $

1,510,818
258,272
42,000
219,921
561,274
(118)
2,592,167
(420,759)
8,147
(48,739)
(461,351)
189,759
(271,592)
(954)
(272,546) $

2,030,046
277,388
41,933
219,632
35,525
(8,152)
2,596,372
242,027
3,787
(55,994)
189,820
(46,801)
143,019
(672)
142,347

(4.11) $
(4.11) $

(4.55) $
(4.55) $

2.38
2.37

$

$
$

See accompanying notes to consolidated financial statements.

51

KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

2021

Year Ended December 31,
2020
($ in thousands)

2019

$

(246,771) $

(271,592) $

143,019

36,547
(1,061)
35,486

(23,320)
(333)
(23,653)

(4,203)
(85)
(4,288)

138,731
(672)
138,059

Net earnings (loss)
Other comprehensive income (loss), net of taxes:

Pension and postretirement benefits
Foreign currency translation adjustments

Total other comprehensive income (loss), net of taxes

Total comprehensive income (loss), net of taxes

Net earnings attributable to noncontrolling interests

Comprehensive income (loss) attributable to Kirby

(211,285)
(183)
(211,468) $

(295,245)
(954)
(296,199) $

$

See accompanying notes to consolidated financial statements.

52

KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS

Cash flows from operating activities:

Net earnings (loss)
Adjustments to reconcile net earnings (loss) to net cash provided by operations:

2021

Year Ended December 31,
2020
($ in thousands)

2019

$

(246,771) $

(271,592)

$

143,019

Depreciation and amortization
Provision (credit) for doubtful accounts
Provision (benefit) for deferred income taxes
Gain on disposition of assets
Impairments and other charges
Amortization of unearned share-based compensation
Amortization of major maintenance costs
Other

Increase (decrease) in cash flows resulting from changes in:

Accounts receivable
Inventory
Other assets
Income taxes payable
Accounts payable
Accrued and other liabilities

Net cash provided by operating activities

Cash flows from investing activities:

Capital expenditures
Acquisitions of businesses and marine equipment, net of cash acquired
Proceeds from disposition of assets and other

Net cash used in investing activities

Cash flows from financing activities:

Borrowings (payments) on bank credit facilities, net
Borrowings on long-term debt
Payments on long-term debt
Payment of debt issue costs
Return of investment to noncontrolling interests and other
Proceeds from exercise of stock options
Payments related to tax withholding for share-based compensation

Net cash provided by (used in) financing activities
Increase (decrease) in cash and cash equivalents

Cash and cash equivalents, beginning of year
Cash and cash equivalents, end of year

Supplemental disclosures of cash flow information:

Cash paid (received) during the period:

Interest paid
Income taxes paid (refunded), net
Operating cash outflow from operating leases

Non-cash investing activity:

Capital expenditures included in accounts payable
Right-of-use assets obtained in exchange for lease obligations

213,718
(138)
(44,419)
(5,761)
340,713
15,713
33,213
(640)

29,126
(19,248)
(38,335)
480
15,951
27,974
321,576

(98,015)
(9,115)
51,342
(55,788)

(248,105)
—
(60,000)
—
(981)
629
(2,856)
(311,313)
(45,525)
80,338
34,813

$

40,878
$
(116,648) $
$
44,089

18,633
33,842

$
$

219,921
3,716
25,163
(118)
561,274
14,722
30,214
(90)

(124,941)
47,076
(29,994)
8,826
(39,795)
558
444,940

(148,185)
(354,972)
17,310
(485,847)

250,024
—
(150,000)
—
(676)
353
(3,193)
96,508
55,601
24,737
80,338

48,721
(35,571)
43,639

(13,280)
46,511

$

$
$
$

$
$

219,632
(873)
46,839
(8,152)
35,525
13,612
23,962
1,683

43,078
122,773
(25,470)
(2,503)
(57,405)
(43,907)
511,813

(248,164)
(262,491)
57,657
(452,998)

(417,376)
500,000
(125,000)
(2,397)
(817)
5,743
(2,031)
(41,878)
16,937
7,800
24,737

55,766
2,926
39,376

13,875
21,195

$

$
$
$

$
$

See accompanying notes to consolidated financial statements.

53

KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY

Common
Stock

Shares

Amount

Additional
Paid-in-
Capital

Accumulated
Other
Comprehensive
Income

Retained
Earnings
(in thousands)

Treasury Stock

Shares

Amount

Noncontrolling
Interests

Total

Balance at December 31, 2018
Stock option exercises
Issuance of stock for equity 
awards, net of forfeitures
Tax withholdings on equity 
award vesting
Amortization of unearned 
share-based compensation
Total comprehensive income, 
net of taxes
Return of investment to 
noncontrolling interests
Balance at December 31, 2019
Stock option exercises
Issuance of stock for equity 
awards, net of forfeitures
Tax withholdings on equity 
award vesting
Amortization of unearned 
share-based compensation
Total comprehensive loss, net 
of taxes
Return of investment to 
noncontrolling interests
Balance at December 31, 2020
Stock option exercises
Issuance of stock for equity 
awards, net of forfeitures
Tax withholdings on equity 
award vesting
Amortization of unearned 
share-based compensation
Total comprehensive loss, net 
of taxes
Return of investment to 
noncontrolling interests
Balance at December 31, 2021

65,472 $ 6,547
—

—

$

823,347
675

$

(33,511) $ 2,723,592
—

—

—

—

—

—

—

—

—

—

(1,735)

—

13,612

—

—

—

—

—

—

—

(4,288)

142,347

—

—
65,472 $ 6,547
—

—

—

—

—

—

—

—

—

—

—

—
65,472 $ 6,547
—

—

$

—
835,899
26

$

(5,668)

—

14,722

—

—
(37,799) $ 2,865,939
—

—

—

—

—

—

—

—

—

(23,653)

(272,546)

$

—
844,979
21

$

—

—
(61,452) $ 2,593,393
—

—

—

—

—

—

—

—

—

—

(6,201)

—

15,713

—

—

—

—

—

—

—

35,486

(246,954)

—

—
65,472 $ 6,547

$

—
854,512

$

—

—
(25,966) $ 2,346,439

(5,608) $ (306,788) $

93

32

5,121

1,735

(30)

(2,031)

—

—

—

—

—

—

(5,513) $ (301,963) $

15

103

327

5,668

(39)

(3,193)

—

—

—

—

—

—

(5,434) $ (299,161) $

12

113

608

6,201

(52)

(2,856)

—

—

—

—

—

—

(5,361) $ (295,208) $

3,114
—

$ 3,216,301
5,796

—

—

—

—

(2,031)

13,612

672

138,731

(817)
2,969
—

(817)
$ 3,371,592
353

—

—

—

—

(3,193)

14,722

954

(295,245)

(676)
3,247
—

(676)
$ 3,087,553
629

—

—

—

—

(2,856)

15,713

183

(211,285)

(972)
2,458

(972)
$ 2,888,782

See accompanying notes to consolidated financial statements.

54

KIRBY CORPORATION AND CONSOLIDATED SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1) Summary of Significant Accounting Policies

Principles of Consolidation. The consolidated financial statements include the accounts of Kirby Corporation and all majority-
owned subsidiaries (the “Company”). All investments in which the Company owns 20% to 50% and exercises significant influence over 
operating and financial policies are accounted for using the equity method. All material intercompany accounts and transactions have 
been eliminated in consolidation. Certain reclassifications have been made to reflect the current presentation of financial information.  
Such reclassifications have no impact on previously reported net earnings (loss), stockholders’ equity, or cash flows.

Accounting Policies

Cash Equivalents. Cash equivalents consist of all short-term, highly liquid investments with maturities of three months or less at 

date of purchase.

Accounts  Receivable.  In  the  normal  course  of  business,  the  Company  extends  credit  to  its  customers.  The  Company  regularly 
reviews the accounts and makes adequate provisions for probable uncollectible balances. It is the Company’s opinion that the accounts 
have no impairment, other than that for which provisions have been made. Included in accounts receivable-trade as of December 31, 
2021 and 2020 were $92,749,000 and $91,850,000, respectively, of accruals for revenues earned which have not been invoiced as of the 
end of each year. 

The  Company’s  marine  transportation  and  distribution  and  services  operations  are  subject  to  hazards  associated  with  such 
businesses.  The  Company  maintains  insurance  coverage  against  these  hazards  with  insurance  companies.  Included  in  accounts 
receivable-other as of December 31, 2021 and 2020 were $69,558,000 and $83,145,000, respectively, of receivables from insurance 
companies to cover claims in excess of the Company’s deductible. 

Concentrations of Credit Risk. Financial instruments which potentially subject the Company to concentrations of credit risk are 
primarily trade accounts receivables. The Company’s marine transportation customers include the major oil refining and petrochemical 
companies. The distribution and services customers are oilfield service companies, oil and gas operators and producers, on-highway 
transportation companies, marine transportation companies, commercial fishing companies, construction companies, power generation 
companies, and the United States government. The Company regularly reviews its accounts and estimates the amount of uncollectible 
receivables each period and establishes an allowance for uncollectible amounts. The amount of the allowance is based on the age of 
unpaid amounts, information about the current financial strength of customers, and other relevant information. Estimates of uncollectible 
amounts are revised each period, and changes are recorded in the period they become known. 

Property, Maintenance and Repairs. Property is recorded at cost or acquisition date fair value; improvements and betterments are 
capitalized as incurred. Depreciation is recorded using the straight-line method over the estimated useful lives of the individual assets 
as  follows:  marine  transportation  equipment,  5-40  years;  buildings,  10-40  years;  other  equipment,  2-10  years;  and  leasehold 
improvements,  term  of  lease.  When  property  items  are  retired,  sold,  or  otherwise  disposed  of,  the  related  cost  and  accumulated 
depreciation are removed from the accounts with any gain or loss on the disposition included in the statement of earnings. Maintenance 
and repairs on vessels built for use on the inland waterways are charged to operating expense as incurred and includes the costs incurred 
in United States Coast Guard (“USCG”) inspections unless the shipyard extends the life or improves the operating capacity of the vessel 
which results in the costs being capitalized. 

Drydocking on Ocean-Going Vessels. The Company’s ocean-going vessels are subject to regulatory drydocking requirements after 
certain  periods  of  time  to  be  inspected,  have  planned  major  maintenance  performed  and  be  recertified  by  the  American  Bureau  of 
Shipping (“ABS”). These recertifications generally occur twice in a five-year period. The Company defers the drydocking expenditures 
incurred on its ocean-going vessels due to regulatory marine inspections by the ABS and amortizes the costs of the shipyard over the 
period  between  drydockings,  generally  30  or  60  months,  depending  on  the  type  of  major  maintenance  performed.  Drydocking 
expenditures that extend the life or improve the operating capability of the vessel result in the costs being capitalized. The Company 
recognized amortization of major maintenance costs of $33,213,000, $30,214,000, and $23,962,000 for the years ended December 31, 
2021, 2020, and 2019, respectively, in costs of sales and operating expenses. Routine repairs and maintenance on ocean-going vessels 
are expensed as incurred. Interest is capitalized on the construction of new ocean-going vessels. Interest expense excludes capitalized 
interest  of  $1,003,000  for  the  year  ending  December 31,  2019.    For  the  years  ended  December 31,  2021  and  2020,  no  interest  was 
capitalized.

Environmental Liabilities. The Company expenses costs related to environmental events as they are incurred or when a loss  is 

considered probable and reasonably estimable. 

55

Goodwill. The excess of the purchase price over the fair value of identifiable net assets acquired in transactions accounted for as a 
purchase is included in goodwill. The Company conducted its annual goodwill impairment tests at November 30, 2021, 2020, and 2019.  
The  Company  also  conducted  interim  goodwill  impairment  tests  at  September  30,  2021  and  March  31,  2020.    Refer  to  Note 7, 
Impairments and other charges for more information. The Company will continue to conduct goodwill impairment tests as of November 
30  of  subsequent  years,  or  whenever  events  or  circumstances  indicate  that  interim  impairment  testing  is  necessary.  The  amount  of 
goodwill impairment, if any, is typically measured based on a combination of projected discounted future operating cash flows using an 
appropriate discount rate and a market approach for comparable companies.  The following table summarizes the changes in goodwill 
(in thousands):

Balance at December 31, 2019 (gross)

Accumulated impairment and amortization

Balance at December 31, 2019

Impairment
Savage acquisition
Convoy acquisition

Balance at December 31, 2020 (gross)

Accumulated impairment and amortization

Balance at December 31, 2020

Impairment

Balance at December 31, 2021 (gross)

Accumulated impairment and amortization

Balance at December 31, 2021

Marine
Transportation

Distribution and
Services

$

$

$

424,149
(18,574)
405,575
—
81,635
—
505,784
(18,574)
487,210
(219,052)
505,784
(237,626)
268,158

$

$

$

549,846
(1,595)
548,251
(387,970)
—
10,309
560,155
(389,565)
170,590
—
560,155
(389,565)
170,590

$

$

$

Total

973,995
(20,169)
953,826
(387,970)
81,635
10,309
1,065,939
(408,139)
657,800
(219,052)
1,065,939
(627,191)
438,748

Other Intangibles. Other intangibles include assets for favorable contracts and customer relationships, distributorship and dealership 
agreements,  trade  names  and  non-compete  agreements  and  liabilities  for  unfavorable  leases  and  contracts.  The  following  table 
summarizes the balances of other intangible assets and other intangible liabilities (in thousands): 

Other intangible assets – gross
Accumulated amortization
Other intangible assets – net

Other intangible liabilities – gross
Accumulated amortization
Other intangible liabilities – net

December 31,

2021

203,217
(143,147)
60,070

13,860
(12,120)
1,740

$

$

$

$

2020

203,217
(134,238)
68,979

13,860
(10,960)
2,900

$

$

$

$

The costs of intangible assets and liabilities are amortized to expense in a systematic and rational manner over their estimated useful 
lives.  For the years ended December 31, 2021, 2020, and 2019, the amortization expense for intangibles was $7,758,000, $9,235,000, 
and $15,040,000, respectively. Estimated net amortization expense for amortizable intangible assets and liabilities for the next five years 
(2022 – 2026) is approximately $7,466,000, $7,947,000, $8,513,000, $8,513,000, and $6,257,000, respectively. As of December 31, 
2021, the weighted average amortization period for intangible assets and liabilities was approximately 8 years.

Revenue Recognition. The majority of marine transportation revenue is derived from term contracts, ranging from one to three 
years, some of which have renewal options, and the remainder is from spot contracts. The majority of the term contracts are for terms 
of one year. The Company provides marine transportation services for its customers and, in almost all cases, does not assume ownership 
of the products it transports. A term contract is an agreement with a specific customer to transport cargo from a designated origin to a 
designated destination at a set rate or at a daily rate. The rate may or may not escalate during the term of the contract, however, the base 
rate generally remains constant and contracts often include escalation provisions to recover changes in specific costs such as fuel. A 
spot contract is an agreement with a customer to move cargo from a specific origin to a designated destination for a rate negotiated at 
the time the cargo movement takes place. Spot contract rates are at the current “market” rate, including fuel, and are subject to market 
volatility. The Company uses a voyage accounting method of revenue recognition for its marine transportation revenues which allocates 
voyage revenue based on the percent of the voyage completed during the period. The performance of the service is invoiced as the 
transaction occurs and payment is required depending on each specific customer’s credit.

Distribution  products  and  services  are  generally  sold  based  upon  purchase  orders  or  preferential  service  agreements  with  the 
customer that include fixed or determinable prices. Parts sales are recognized when control transfers to the customer, generally when 
title passes upon shipment to customers. Service revenue is recognized over time as the service is provided using measures of progress 

56

utilizing  hours  worked  or  costs  incurred  as  a  percentage  of  estimated  hours  or  expected  costs.  Revenue  from  rental  agreements  is 
recognized  on  a  straight-line  basis  over  the  rental  period.  The  Company  recognizes  the  revenues  on  manufacturing  activities  upon 
shipment and transfer of control to the customer. The transactions in the distribution and services segment are typically invoiced as parts 
are shipped or upon the completion of the service job. Contract manufacturing activities are generally invoiced upon shipment and the 
Company will often get deposits from its customers prior to starting work, or progress payments during the project depending on the 
credit worthiness of the customer and the size of the project. 

Stock-Based Compensation. The Company has share-based compensation plans covering selected officers and other key employees 
as well as the Company’s Board of Directors. Stock-based grants made under the Company’s stock plans are recorded at fair value on 
the date of the grant and the cost for all grants made under the director plan and for grants made under the employee plan  is generally 
recognized ratably over the vesting period of the restricted stock unit ("RSU"), stock option, or restricted stock, however, the employee 
plan includes a provision for the continued vesting of unvested stock options and RSUs for employees who meet certain years of service 
and age requirements at the time of their retirement. The provision results in shorter expense accrual periods on stock options and RSUs 
granted to employees who are nearing retirement and meet the service and age requirements. Stock option grants are valued at the date 
of  grant  as  calculated  under  the  Black-Scholes  option  pricing  model.  The  Company  accounts  for  forfeitures  as  they  occur.  The 
Company’s stock-based compensation plans are more fully described in Note 8, Stock Award Plans. 

Taxes on Income. The Company follows the asset and liability method of accounting for income taxes. Under the asset and liability 
method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial 
statement carrying amounts of existing assets and liabilities and their respective tax basis and operating loss and tax credit carryforwards. 
Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those 
temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is 
recognized in income in the period that includes the enactment date. 

Accrued Insurance. Accrued insurance liabilities include estimates based on individual incurred claims outstanding and an estimated 
amount for losses incurred but not reported (“IBNR”) or fully developed based on past experience. Insurance premiums, IBNR losses 
and  incurred  claim  losses,  in  excess  of  the  Company’s  deductible  for  the  years  ended  December 31,  2021,  2020,  and  2019,  were 
$37,836,000, $30,564,000, and $32,372,000, respectively. 

Treasury Stock. The Company follows the average cost method of accounting for treasury stock transactions. 

Impairment of Long-lived Assets and for Long-lived Assets to Be Disposed Of. The Company performs an impairment assessment 

whenever events or changes in circumstances indicate that the carrying amount of long-lived assets may not be recoverable. 

Recoverability on marine transportation assets is assessed based on vessel classes, not on individual assets, because identifiable 
cash flows for individual marine transportation assets are not available. Projecting customer contract volumes allows estimation of future 
cash flows by projecting pricing and utilization by vessel class but it is not practical to project which individual marine transportation 
asset will be utilized for any given contract. Because customers do not specify which particular vessel is used, prices are quoted based 
on vessel classes not individual assets. Nominations of vessels for specific jobs are determined on a day by day basis and are a function 
of the equipment class required and the geographic position of vessels within that class at that particular time as vessels within a class 
are interchangeable and provide the same service. The Company’s vessels are mobile assets and equipped to operate in geographic 
regions throughout the United States and the Company has in the past and expects to continue to move vessels from one region to 
another when it is necessary due to changing markets and it is economical to do so. Barge vessel classes are based on similar capacities, 
hull type, and type of product and towing vessels are based on similar hull type and horsepower. 

If a triggering event is identified, the Company compares the carrying amount of the asset group to the estimated undiscounted 
future cash flows expected to result from the use of the asset group. If the carrying amount of the asset group exceeds the estimated 
undiscounted future cash flows, the Company measures the amount of the impairment by comparing the carrying amount of the asset 
group to its estimated fair value. Assets to be disposed of are reported at the lower of the carrying amount or fair value less costs to sell.

Fair Value Measurements. The accounting guidance for using fair value to measure certain assets and liabilities establishes a three 
tier value hierarchy, which prioritizes the inputs to valuation techniques used in measuring fair value. These tiers include: Level 1, 
defined as observable inputs such as quoted prices in active markets for identical assets or liabilities; Level 2, defined as inputs other 
than quoted prices in active markets that are either directly or indirectly observable; and Level 3, defined as unobservable inputs in 
which little, if any, market data exists, therefore requiring an entity to develop its own assumptions about the assumptions that market 
participants would use in pricing the asset or liability.  The fair value of the Company’s debt instruments is described in Note 5, Long-
Term Debt. 

57

Accounting Standards

In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") 2019-12, 
“Income  Taxes  (Topic  740):  Simplifying  the  Accounting  for  Income  Taxes”  ("ASU  2019-12")  which  simplifies  the  accounting  for 
income taxes by removing certain exceptions to the general principles in Topic 740, Income Taxes.  The Company adopted ASU 2019-12 
on January 1, 2021.  There was no material impact on the Company’s financial statements or disclosures upon adoption of ASU 2019-
12.  

In January 2017, the FASB issued ASU 2017-04, “Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill 
Impairment”  (“ASU  2017-04”)  which  simplifies  the  subsequent  measurement  of  goodwill  by  eliminating  Step  2  in  the  goodwill 
impairment test that required an entity to perform procedures to determine the fair value of its assets and liabilities at the testing date. 
An entity instead shall perform its annual, or interim, goodwill impairment test by comparing the fair value of a reporting unit with its 
carrying  value  and  record  an  impairment  charge  based  on  the  excess  of  a  reporting  unit’s  carrying  amount  over  its  fair  value, 
incorporating all tax impacts caused by the recognition of the impairment loss. An entity still has the option to perform the qualitative 
assessment for a reporting unit to determine if the quantitative impairment test is necessary. The Company adopted ASU 2017-04 on 
January 1, 2020 on a prospective basis.  See Note 7, Impairments and Other Charges for further details.

(2) Acquisitions

During 2021, the Company purchased four inland tank barges from a leasing company for $7,470,000 in cash.  The Company had 

been leasing the barges prior to the purchase.

On October 4, 2021, the Company paid $1,645,000 in cash to purchase assets of an energy storage systems manufacturer based in 
Texas which have been key to the development of new power generation solutions for electric fracturing equipment.  Assets acquired 
and liabilities assumed consisted primarily of a right of use lease asset and lease liability for an operating lease assumed as part of the 
acquisition.

Pro forma results of the acquisitions made in 2021 have not been presented as the pro forma revenues and net earnings attributable 

to Kirby would not be materially different from the Company’s actual results.

During 2020, the Company purchased six newly constructed inland pressure barges for $39,350,000 in cash.

On April 1, 2020, the Company completed the acquisition of the inland tank barge fleet of Savage Inland Marine, LLC (“Savage”) 
for $278,999,000 in cash.  Savage’s tank barge fleet consisted of 92 inland tank barges with approximately 2.5 million barrels of capacity 
and 45 inland towboats. The Savage assets that were acquired primarily move petrochemicals, refined products, and crude oil on the 
Mississippi River, its tributaries, and the Gulf Intracoastal Waterway.  The Company also acquired Savage’s ship bunkering business 
and  barge  fleeting  business  along  the  Gulf  Coast.    The  Company  considers  Savage  to  be  a  natural  extension  of  the  current  marine 
transportation  segment,  expanding  the  capabilities  of  the  Company’s  inland  based  marine  transportation  business  and  lowering  the 
average age of its fleet.

On  January  3,  2020,  the  Company  completed  the  acquisition  of  substantially  all  the  assets  of  Convoy  Servicing  Company  and 
Agility  Fleet  Services,  LLC  (collectively  “Convoy”)  for  $37,180,000  in  cash.    Convoy  is  an  authorized  dealer  for  Thermo  King 
refrigeration systems for trucks, railroad cars and other land transportation markets for North and East Texas and Colorado.

58

The fair values of the assets acquired and liabilities assumed from the Savage and Convoy acquisitions recorded at the respective 

acquisition dates were as follows (in thousands):

Accounts receivable
Inventories
Prepaid expenses
Property and equipment
Operating lease right-of-use assets
Goodwill
Other intangibles
Total assets

Accounts payable and accrued liabilities
Operating lease liabilities, including current portion

Total liabilities

Net assets acquired

Savage

Convoy

$

$

$

$
$

— $
—
1,067
210,065
27,085
81,635
2,300
322,152

$

68
43,085
43,153
278,999

$

$
$

5,677
11,771
177
415
3,713
10,309
17,170
49,232

8,339
3,713
12,052
37,180

The Company acquired customer relationships with an estimated value of $2,300,000 from Savage with an amortization period of 
10 years.  Acquisition related costs of $376,000, consisting primarily of legal and other professional fees, were expensed as incurred to 
selling, general and administrative expense.  All goodwill recorded for the Savage acquisition will be deductible for tax purposes.

The  Company  acquired  intangible  assets  from  Convoy  with  a  weighted  average  amortization  period  of  11  years,  consisting  of 
$9,000,000 for customer relationships with an amortization period of 10 years, $8,000,000 for distributorships with an amortization 
period of 12 years and $170,000 for non-compete agreements with an amortization period of three years.  All goodwill recorded for the 
Convoy acquisition will be deductible for tax purposes.

During the year ended December 31, 2019, the Company purchased, from various counterparties, a barge fleeting operation in Lake 
Charles, Louisiana and nine inland tank barges from leasing companies for an aggregate of $17,991,000 in cash. The Company had been 
leasing the barges prior to the purchases. 

On March 14, 2019, the Company completed the acquisition of the marine transportation fleet of Cenac Marine Services, LLC 
(“Cenac”) for $244,500,000 in cash. Cenac’s fleet consisted of 63 inland 30,000 barrel tank barges with approximately 1,833,000 barrels 
of capacity, 34 inland towboats and two offshore tugboats. Cenac transported petrochemicals, refined products and black oil, including 
crude oil, residual fuels, feedstocks and lubricants on the lower Mississippi River, its tributaries, and the Gulf Intracoastal Waterway for 
major oil companies and refiners. The average age of the inland tank barges was approximately five years and the inland towboats had 
an  average  age  of  approximately  seven  years.    The  Company  considers  Cenac  to  be  a  natural  extension  of  the  current  marine 
transportation  segment,  expanding  the  capabilities  of  the  Company’s  inland  based  marine  transportation  business  and  lowering  the 
average age of its inland tank barge and towboat fleet.

The fair values of the assets acquired and liabilities assumed from the Cenac acquisition and recorded at the acquisition date were 

as follows (in thousands): 

Prepaid expenses
Property and equipment
Other intangibles
Total assets

Other long-term liabilities
Net assets acquired

$

$

$
$

1,138
247,122
340
248,600

4,100
244,500

The  Company  acquired  intangible  assets  with  an  amortization  period  of  two  years  and  incurred  long-term  intangible  liabilities 
related to unfavorable contracts with a weighted average amortization period of approximately 1.3 years. Acquisition related costs of 
$442,000, consisting primarily of legal and other professional fees, were expensed as incurred to selling, general and administrative 
expense in 2019. 

59

(3) Revenues

The following table sets forth the Company’s revenues by major source (in thousands): 

Marine transportation segment:

Inland transportation
Coastal transportation

Distribution and services segment:

Commercial and industrial
Oil and gas

2021

Year Ended December 31,
2020

2019

$

$

$

$

1,005,145
317,773
1,322,918

578,011
345,731
923,742

$

$

$

$

1,094,630
309,635
1,404,265

566,326
200,817
767,143

$

$

$

$

1,220,878
366,204
1,587,082

591,953
659,364
1,251,317

The Company’s revenue is measured based on consideration specified in its contracts with its customers. The Company recognizes 
revenue over time as it provides services to its customers, or at the point in time that control over a part or product transfers to its 
customer. 

Contract Assets and Liabilities. Contract liabilities represent advance consideration received from customers, and are recognized 
as revenue over time or at a point in time as the related performance obligation is satisfied. Revenues recognized during the years ended 
December 31, 2021, 2020, and 2019, that were included in the opening contract liability balances were $40,925,000, $38,455,000 and 
$76,412,000, respectively. The Company has recognized all contract liabilities within the deferred revenues financial statement caption 
on the balance sheet. The Company did not have any contract assets at December 31, 2021 or December 31, 2020.  The Company applies 
the practical expedient that allows non-disclosure of information about remaining performance obligations that have original expected 
durations of one year or less.

(4) Segment Data

The Company’s operations are aggregated into two reportable business segments as follows:

Marine Transportation — Provides marine transportation by United States flagged vessels principally of liquid cargoes throughout 
the  United  States  inland  waterway  system,  along  all  three  United  States  coasts,  and  to  a  lesser  extent,  in  United  States  coastal 
transportation of dry-bulk cargoes. The principal products transported include petrochemicals, black oil, refined petroleum products and 
agricultural chemicals.

Distribution and Services — Provides after-market service and genuine replacement parts for engines, transmissions, reduction 
gears and related equipment used in oilfield services, marine, power generation, on-highway, and other industrial applications. The 
Company also rents equipment including generators, industrial compressors, high capacity lift trucks, and refrigeration trailers for use 
in a variety of industrial markets, and manufactures and remanufactures oilfield service equipment, including pressure pumping units, 
electric power generation equipment, specialized electrical distribution and control equipment, and high capacity energy storage/battery 
systems for oilfield service customers.

The Company’s two reportable business segments are managed separately based on fundamental differences in their operations. 
The  Company’s  accounting  policies  for  the  business  segments  are  the  same  as  those  described  in  Note  1,  Summary  of  Significant 
Accounting Policies. The Company evaluates the performance of its segments based on the contributions to operating income of the 
respective  segments,  and  before  income  taxes,  interest,  gains  or  losses  on  disposition  of  assets,  other  nonoperating  income, 
noncontrolling interests, accounting changes, and nonrecurring items. Intersegment revenues, based on market-based pricing, of the 
distribution and services segment from the marine transportation segment of $23,632,000, $27,782,000, and $27,441,000 in 2021, 2020, 
and 2019, respectively, as well as the related intersegment profit of $2,363,000, $2,778,000, and $2,744,000 in 2021, 2020, and 2019, 
respectively, have been eliminated from the tables below.

60

 
 
The following tables set forth by reportable segment the revenues, profit or loss, total assets, depreciation and amortization, and 

capital expenditures attributable to the principal activities of the Company (in thousands):

Revenues:

Marine transportation
Distribution and services

Segment profit (loss):

Marine transportation
Distribution and services
Other

Depreciation and amortization:

Marine transportation
Distribution and services
Other

Capital expenditures:

Marine transportation
Distribution and services
Other

Total assets:

Marine transportation
Distribution and services
Other

$

$

$

$

$

$

$

$

2021

Year Ended December 31,
2020

2019

1,322,918
923,742
2,246,660

$

$

1,404,265
767,143
2,171,408

$

$

1,587,082
1,251,317
2,838,399

$

63,015
27,607
(381,223)
(290,601) $

$

163,638
(12,191)
(612,798)
(461,351) $

215,842
67,201
(93,223)
189,820

179,742
35,998
3,892
219,632

217,364
18,284
12,516
248,164

186,798
28,255
4,868
219,921

133,990
4,854
9,341
148,185

$

$

$

$

December 31,

2021

2020

4,319,080
892,603
187,380
5,399,063

$

$

4,760,449
805,831
357,894
5,924,174

185,979
20,573
7,166
213,718

84,353
8,104
5,558
98,015

$

$

$

$

$

$

The following table presents the details of “Other” segment profit (loss) (in thousands):

General corporate expenses
Gain on disposition of assets
Impairments and other charges
Interest expense
Other income

2021

Year Ended December 31,
2020

2019

$

$

(13,803) $
5,761
(340,713)
(42,469)
10,001
(381,223) $

(11,050) $
118
(561,274)
(48,739)
8,147
(612,798) $

(13,643)
8,152
(35,525)
(55,994)
3,787
(93,223)

The following table presents the details of “Other” total assets (in thousands):

General corporate assets
Investment in affiliates

December 31,

2021

2020

$

$

185,246
2,134
187,380

$

$

355,205
2,689
357,894

61

 
 
 
 
 
 
 
(5) Long-Term Debt

The following table presents the carrying value and fair value of debt outstanding (in thousands):

Revolving Credit Facility due March 27, 2024 (a)
Term Loan due March 27, 2024 (a)
3.29% senior notes due February 27, 2023
4.2% senior notes due March 1, 2028
Credit Line due June 30, 2022
Bank notes payable

Unamortized debt discounts and issuance costs (b)

2021

2020

December 31,

Carrying Value

Fair Value

Carrying Value

Fair Value

$

$

— $

— $

315,000
350,000
500,000
—
1,934
1,166,934
(3,567)
1,163,367

315,000
358,390
549,239
—
1,934
1,224,563
—

$

1,224,563 $

250,000
375,000
350,000
500,000
—
40
1,475,040
(6,454)
1,468,586

$

$

250,000
375,000
364,538
581,115
—
40
1,570,693
—
1,570,693

(a) Variable interest rate of 1.5% at both December 31, 2021 and 2020.
(b) Excludes $1,403,000 attributable to the Revolving Credit Facility included in other assets at December 31, 2021.

The fair value of debt outstanding was determined using inputs characteristic of a Level 2 fair value measurement. 

The following table presents borrowings and payments under the bank credit facilities (in thousands):

Borrowings on bank credit facilities
Payments on bank credit facilities

2021

Year Ended December 31,
2020

$

6,162
(254,267)
(248,105) $

582,277
(332,253)
250,024

$

$

$

$

2019
1,351,158
(1,768,534)
(417,376)

The aggregate payments due on the long-term debt in each of the next five years were as follows (in thousands): 

2022
2023
2024
2025
2026
Thereafter

1,934
350,000
315,000
—
—
500,000
1,166,934

$

The  Company  has  an  amended  and  restated  credit  agreement  (“Credit  Agreement”)  with  a  group  of  commercial  banks,  with 
JPMorgan Chase Bank, N.A. as the administrative agent bank, allowing for an $850,000,000 revolving credit facility (“Revolving Credit 
Facility”) and an unsecured term loan (“Term Loan”) with a maturity date of March 27, 2024.  The Credit Agreement provides for a 
variable interest rate based on the London interbank offered rate (“LIBOR”) or a base rate calculated with reference to the agent bank’s 
prime rate, among other factors (the “Alternate Base Rate”). The interest rate varies with the Company’s credit rating and is currently 
112.5 basis points over LIBOR or 12.5 basis points over the Alternate Base Rate. The Term Loan is due on March 27, 2024 and is 
prepayable,  in  whole  or  in  part,  without  penalty.    During  2021  and  2020,  the  Company  repaid  $60,000,000  and  $125,000,000, 
respectively,  under  the  Term  Loan  prior  to  the  originally  scheduled  installments.    The  Credit  Agreement  contains  certain  financial 
covenants including an interest coverage ratio and a debt-to-capitalization ratio. In addition to financial covenants, the Credit Agreement 
contains  covenants  that,  subject  to  exceptions,  restrict  debt  incurrence,  mergers  and  acquisitions,  sales  of  assets,  dividends  and 
investments,  liquidations  and  dissolutions,  capital  leases,  transactions  with  affiliates  and  changes  in  lines  of  business.  The  Credit 
Agreement specifies certain events of default, upon the occurrence of which the maturity of the outstanding loans may be accelerated, 
including  the  failure  to  pay  principal  or  interest,  violation  of  covenants  and  default  on  other  indebtedness,  among  other  events. 
Borrowings under the Credit Agreement may be used for general corporate purposes including acquisitions. As of December 31, 2021, 
the  Company  was  in  compliance  with  all  Credit  Agreement  covenants.    The  Revolving  Credit  Facility  includes  a  $25,000,000 
commitment which may be used for standby letters of credit. Outstanding letters of credit under the Revolving Credit Facility were 
$5,063,000 and available borrowing capacity was $844,937,000 as of December 31, 2021. 

The Company has $350,000,000 of 3.29% senior unsecured notes due February 27, 2023 (the “2023 Notes”).  No principal payments 
are  required  until  maturity.  The  2023  Notes  contain  certain  covenants  on  the  part  of  the  Company,  including  an  interest  coverage 

62

 
 
 
 
covenant, a debt-to-capitalization covenant, and covenants relating to liens, asset sales and mergers, among others. The 2023 Notes also 
specify certain events of default, upon the occurrence of which the maturity of the notes may be accelerated, including failure to pay 
principal and interest, violation of covenants or default on other indebtedness, among others. 

The Company has $500,000,000 of 4.2% senior unsecured notes due March 1, 2028 (the “2028 Notes”) with U.S. Bank National 
Association, as trustee. No principal payments are required until maturity.  Interest payments of $10,500,000 are due semi-annually on 
March 1 and September 1 of each year.  The 2028 Notes are unsecured and rank equally in right of payment with the Company’s other 
unsecured senior indebtedness. The 2028 Notes contain certain covenants on the part of the Company, including covenants relating to 
liens, sale-leasebacks, asset sales and mergers, among others. The 2028 Notes also specify certain events of default, upon the occurrence 
of which the maturity of the notes may be accelerated, including failure to pay principal and interest, violation of covenants or default 
on other indebtedness, among others. 

On February 3, 2022, the Company entered into a note purchase agreement for the issuance of $300,000,000 of unsecured senior 
notes with a group of institutional investors, consisting of $60,000,000 of 3.46% series A notes ("Series A Notes") and $240,000,000 of 
3.51% series B notes ("Series B Notes"), each due January 19, 2033 (collectively, the "2033 Notes").  The Series A Notes are scheduled 
to be issued on October 20, 2022, and the Series B Notes are scheduled to be issued on January 19, 2023.  No principal payments will 
be required until maturity. Beginning in 2023, interest payments of $5,250,000 will be due semi-annually on January 19 and July 19 of 
each year, with the exception of the first payment on January 19, 2023, which will be $525,000.  The 2033 Notes will be unsecured and 
rank equally in right of payment with the Company's other unsecured senior indebtedness.  The 2033 Notes contain certain covenants 
on the part of the Company, including an interest coverage covenant, a debt-to-capitalization covenant, and covenants relating to liens, 
asset sales and mergers, among others. The 2033 Notes also specify certain events of default, upon the occurrence of which the maturity 
of the notes may be accelerated, including failure to pay principal and interest, violation of covenants or default on other indebtedness, 
among others.  The Company intends to use the proceeds from the issuance of the 2033 Notes and cash provided by operations to repay 
the 2023 Notes upon maturity.

The Company has a $10,000,000 line of credit (“Credit Line”) with Bank of America, N.A. (“Bank of America”) for short-term 
liquidity needs and letters of credit, with a maturity date of June 30, 2022. The Credit Line allows the Company to borrow at an interest 
rate agreed to by Bank of America and the Company at the time each borrowing is made or continued. The Company had no borrowings 
outstanding under the Credit Line as of December 31, 2021. Outstanding letters of credit under the Credit Line were $1,299,000 and 
available borrowing capacity was $8,701,000 as of December 31, 2021. 

The Company also had $1,934,000 and $40,000 of short-term unsecured loans outstanding, as of December 31, 2021 and 2020, 

respectively, related to its South American operations. 

On February 27, 2020, upon maturity, the Company repaid in full $150,000,000 of 2.72% unsecured senior notes.

As of December 31, 2021, the Company was in compliance with all covenants under its debt instruments.

(6) Leases

The  Company  currently  leases  various  facilities  and  equipment  under  cancelable  and  noncancelable  operating  leases.  The 
accounting for the Company’s leases may require judgments, which include determining whether a contract contains a lease, allocating 
the consideration between lease and non-lease components, and determining the incremental borrowing rates. Leases with an initial 
noncancelable term of 12 months or less are not recorded on the balance sheet and the related lease expense is recognized on a straight-
line basis over the lease term. The Company has also elected to combine lease and non-lease components on all classes of leased assets, 
except for leased towing vessels for which the Company estimates approximately 70% of the costs relate to service costs and other non-
lease components. Variable lease costs relate primarily to real estate executory costs (i.e. taxes, insurance and maintenance). 

Future minimum lease payments under operating leases that have initial noncancelable lease terms in excess of one year were as 

follows (in thousands): 

2022
2023
2024
2025
2026
Thereafter
Total lease payments
Less: imputed interest
Operating lease liabilities

$

$

41,685
35,833
28,837
23,794
18,361
91,237
239,747
(46,173)
193,574

63

The following table summarizes lease costs (in thousands): 

Operating lease cost
Variable lease cost
Short-term lease cost
Sublease income
Total lease cost

2021

Year Ended December 31,
2020

2019

$

$

40,786
1,793
17,914
(1,032)
59,461

$

$

43,810
1,550
25,387
(1,143)
69,604

$

$

39,064
2,326
31,340
(420)
72,310

The following table summarizes other supplemental information about the Company’s operating leases:

Weighted average discount rate
Weighted average remaining lease term

(7) Impairments and Other Charges

2021

3.8%

9 years

December 31,
2020

4.1%

10 years

2019

4.0%

11 years

During the third quarter of 2021, the Company decided to exit the Hawaii market, selling marine transportation equipment including 
four coastal tank barges, seven coastal tugboats, and certain other assets for aggregate cash proceeds of $17,200,000.  In addition, as of 
September 30, 2021, the Company retired and classified as held for sale, an additional 12 coastal tank barges and four coastal tugboats 
which  were  underutilized.    The  sales  and  retirements  of  coastal  marine  transportation  equipment  resulted  in  an  aggregate  non-cash 
impairment charge of $97,508,000 to reduce the carrying value of these assets to their estimated sales prices, net of costs to sell.

As a result of the sale of the Hawaii marine transportation equipment, and the decision to retire certain additional underutilized 
coastal  tank  barges  and  tugboats,  the  Company  concluded  that  a  triggering  event  had  occurred  and  performed  interim  quantitative 
impairment tests as of September 30, 2021 for certain of the marine transportation segment's long-lived assets and goodwill within the 
coastal marine market.  

The Company determined the estimated fair value of such long-lived assets using a combination of a cost approach, a discounted 
cash flow analysis, and a market approach.  The Company determined the estimated fair value of the reporting unit using a combination 
of a discounted cash flow analysis and a market approach for comparable companies.  These analyses included management’s judgment 
regarding short-term and long-term internal forecasts, updated for recent events, appropriate discount rates, and capital expenditures 
using inputs characteristic of a Level 3 fair value measurement.  

In performing the impairment test of certain long-lived assets within the marine transportation segment, the Company determined 
that the carrying value of certain long-lived assets, including certain coastal marine transportation equipment and operating lease right-
of-use assets, were no longer recoverable, resulting in a non-cash impairment charge of $24,152,000 during the three months ended 
September 30, 2021 to reduce such long-lived assets to fair value. 

Based upon the results of the goodwill impairment test, the Company concluded that the carrying value of one reporting unit in the 
marine transportation segment exceeded its estimated fair value.  The carrying value of the reporting unit, including goodwill, and after 
recording  impairments  of  long-lived  assets  identified  above,  exceeded  its  estimated  fair  value,  resulting  in  a  non-cash  goodwill 
impairment charge of $219,052,000 for the three months ended September 30, 2021. 

During the first quarter of 2020, Kirby’s market capitalization declined significantly compared to the fourth quarter of 2019.  Over 
the same period, the overall United States stock market also declined significantly amid market volatility. In addition, as a result of 
uncertainty surrounding the outbreak of COVID-19 and a sharp decline in oil prices during the 2020 first quarter, many of the Company’s 
oil and gas customers responded by quickly cutting 2020 capital spending budgets and activity levels quickly declined.  Lower activity 
levels resulted in a decline in drilling activity, resulting in lower demand for new and remanufactured oilfield equipment and related 
parts and service in the distribution and services segment.  As a result, the Company concluded that a triggering event had occurred and 
performed interim quantitative impairment tests as of March 31, 2020 for certain of the distribution and services segment’s long-lived 
assets and goodwill.

The Company determined the estimated fair value of such long-lived assets and reporting units using a discounted cash flow analysis 
and a market approach for comparable companies.  This analysis included management’s judgment regarding short-term and long-term 
internal forecasts, updated for recent events, appropriate discount rates, and capital expenditures using inputs characteristic of a Level 3 
fair value measurement.  

64

 
 
 
In performing the impairment test of long-lived assets within the distribution and services segment, the Company determined that 
the carrying value of certain long-lived assets, including property and equipment as well as intangible assets associated with customer 
relationships,  tradenames,  and  distributorships,  were  no  longer  recoverable,  resulting  in  an  impairment  charge  of  $165,304,000  
(including $148,909,000 impairment of intangible assets other than goodwill and $16,395,000 impairment of property and equipment) 
to reduce such long-lived assets to fair value during the three months ended March 31, 2020.  

Based upon the results of the goodwill impairment test, the Company concluded that the carrying value of one reporting unit in the 
distribution  and  services  segment  exceeded  its  estimated  fair  value.    For  the  three  months  ended  March  31,  2020,  the  goodwill 
impairment charge of $387,970,000 was calculated as the amount that the carrying value of the reporting unit, including goodwill, and 
after recording impairments of long-lived assets identified above, exceeded its estimated fair value, incorporating all tax impacts caused 
by the recognition of the impairment loss.

In addition, the Company determined cost exceeded net realizable value for certain oilfield and pressure pumping related inventory, 

resulting in an $8,000,000 non-cash write-down during the three months ended March 31, 2020.

During  the  fourth  quarter  of  2019,  the  Company  recorded  a  $35,525,000  non-cash  pre-tax  write-down  of  oilfield  and  pressure 

pumping related inventory in the distribution and services segment. 

(8) Stock Award Plans

The Company has share-based compensation plans which are described below. The compensation cost that has been charged against 
earnings for the Company’s stock award plans and the income tax benefit recognized in the statement of earnings for stock awards were 
as follows (in thousands): 

Compensation cost
Income tax benefit

2021

Year Ended December 31,
2020

15,713
4,410

$
$

14,722
4,143

$
$

$
$

2019

13,612
3,368

The Company has an employee stock award plan for selected officers and other key employees which provides for the issuance of 
RSUs, stock options, restricted stock awards, and performance awards.  Restricted stock and RSUs generally vest ratably over five years, 
however, the plan includes a provision for the continued vesting of unvested stock options and RSUs for employees who meet certain 
years of service and age requirements at the time of their retirement. The provision results in shorter expense accrual periods on stock 
options and RSUs granted to employees who are nearing retirement and meet the service and age requirements.

On March 1, 2021, subject to stockholder approval, the Board of Directors approved amendments to the Company’s 2005 Stock 
and  Incentive  Plan  (the  “Plan”)  to,  among  other  things,  add  1,400,000  shares  of  availability.    The  amendment  to  the  Plan  was 
subsequently approved at the Annual Meeting of Stockholders on April 27, 2021.  At December 31, 2021, there were 2,202,589 shares 
available for future grants under the Plan. 

The exercise price for each option equals the fair market value per share of the Company’s common stock on the date of grant. 
Substantially all stock options outstanding under the plan have terms of seven years and vest ratably over three years. No performance 
awards payable in stock have been awarded under the plan and no outstanding stock options under the employee plan were issued with 
stock appreciation rights.

The following is a summary of the stock option activity under the employee plan described above: 

Outstanding at December 31, 2020

Exercised
Forfeited or expired

Outstanding at December 31, 2021

Outstanding
Non-Qualified or
Nonincentive
Stock
Awards

Weighted
Average
Exercise
Price

577,517

$
(2,424) $
(37,326) $
$
537,767

72.09
51.23
93.96
70.66

65

The following table summarizes information about the Company’s outstanding and exercisable stock options under the employee 

plan at December 31, 2021: 

Range of Exercise
Prices

$51.23
$64.65 – $68.50
$73.29 – $75.50
$84.90
$51.23 – $84.90

Number
Outstanding
59,891
92,385
378,786
6,705
537,767

Options Outstanding

Options Exercisable

Weighted
Average
Remaining
Contractual
Life in
Years

Weighted
Average
Exercise
Price

Aggregated
Intrinsic
Value

Number
Exercisable

Weighted
Average
Exercise
Price

Aggregated
Intrinsic
Value

1.1 $
2.5 $
3.6 $
4.3 $
3.2 $

51.23
67.24
74.32
84.90
70.66 $

491,000

59,891 $
92,385 $
266,478 $
4,470 $
423,224 $

51.23
67.24
74.67
84.90
69.84 $

491,000

The following is a summary of the restricted stock award activity under the employee plan described above: 

Nonvested balance at December 31, 2020

Vested
Forfeited

Nonvested balance at December 31, 2021

Unvested
Restricted
Stock Award
Shares

Weighted
Average
Grant Date
Fair Value
Per Share

83,902
$
(65,037) $
(441) $
$

18,424

63.33
61.77
68.50
68.72

No restricted stock awards were granted under the employee plan during 2021, 2020, and 2019.

The following is a summary of RSU activity under the employee plan described above: 

Nonvested balance at December 31, 2020

Granted
Vested
Forfeited

Nonvested balance at December 31, 2021

Unvested RSUs

$
338,418
339,092
$
(83,304) $
(3,227) $
$

590,979

Weighted
Average Grant
Date Fair Value
Per Unit

74.09
51.36
74.29
63.97
61.07

The weighted average grant date fair value of RSUs granted for the years ended December 31, 2021, 2020, and 2019 was $51.36, 

$73.04, and $74.46, respectively.

During January 2022, the Company granted 196,915 RSUs to selected officers and other key employees under its employee stock 

award plan, which vest ratably over five years.

The Company has a stock award plan for nonemployee directors of the Company which provides for the issuance of stock options 
and  restricted  stock.  The  director  plan  provides  for  automatic  grants  of  restricted  stock  to  nonemployee  directors  after  each  annual 
meeting of stockholders. In addition, the director plan allows for the issuance of stock options or restricted stock in lieu of cash for all 
or part of the annual director fee at the option of the director. The exercise prices for all options granted under the plan are equal to the 
fair market value per share of the Company’s common stock on the date of grant. The terms of the options are ten years. The restricted 
stock issued after each annual meeting of stockholders vests six months after the date of grant. Options granted and restricted stock 
issued  in  lieu  of  cash  director  fees  vest  in  equal  quarterly  increments  during  the  year  to  which  they  relate.  At  December 31,  2021, 
391,447 shares were available for future grants under the director plan. The director stock award plan is intended as an incentive to 
attract and retain qualified independent directors. 

66

The following is a summary of the stock option activity under the director plan described above: 

Outstanding at December 31, 2020

Exercised

Outstanding at December 31, 2021

Outstanding
Non-Qualified or
Nonincentive
Stock
Awards

Weighted
Average
Exercise
Price

103,756
$
(14,776) $
$
88,980

77.44
57.06
80.82

The following table summarizes information about the Company’s outstanding and exercisable stock options under the director 

plan at December 31, 2021: 

Range of Exercise
Prices
$61.89 – $62.48
$70.65 – $99.52
$61.89 – $99.52

Number
Outstanding

20,500
68,480
88,980

Options Outstanding

Options Exercisable

Weighted
Average
Remaining
Contractual
Life in
Years

Weighted
Average
Exercise
Price

Aggregate
Intrinsic
Value

Number
Exercisable

Weighted
Average
Exercise
Price

Aggregate
Intrinsic
Value

0.6 $
2.1 $
1.8 $

62.19
86.39
80.82 $

20,500 $
68,480 $
88,980 $

62.19
86.39
80.82 $

—

—

The following is a summary of the restricted stock award activity under the director plan described above: 

Nonvested balance at December 31, 2020

Granted
Vested

Nonvested balance at December 31, 2021

Unvested
Restricted
Stock Award
Shares

Weighted
Average
Grant Date
Fair Value
Per Share

$
904
29,773
$
(27,340) $
$
3,337

49.84
65.13
65.41
58.70

The  weighted  average  grant  date  fair  value  of  restricted  stock  awards  granted  under  the  director  plan  for  the  years  ended 

December 31, 2021, 2020, and 2019 were $65.13, $49.84, and $84.81, respectively.

The total intrinsic value of all stock options exercised under all of the Company’s plans was $115,000, $745,000, and $1,655,000 
for the years ended December 31, 2021, 2020, and 2019, respectively. The actual tax benefit realized for tax deductions from stock 
option exercises was $32,000, $210,000, and $410,000 for the years ended December 31, 2021, 2020, and 2019, respectively. 

The total fair value of all the restricted stock vestings under all of the Company’s plans was $5,344,000, $5,649,000, and $5,917,000 
for the years ended December 31, 2021, 2020, and 2019, respectively. The actual tax benefit realized for tax deductions from restricted 
stock vestings was $1,500,000, $1,590,000, and $1,464,000 for the years ended December 31, 2021, 2020, and 2019, respectively. 

The total fair value of all the RSU vestings under the Company’s employee plan was $4,419,000, $5,172,000 and $1,727,000 for 
the years ended December 31, 2021, 2020, and 2019 respectively. The actual tax benefit realized for tax deductions from RSU vestings 
was $1,240,000, $1,455,000 and $427,000 for the years ended December 31, 2021, 2020, and 2019 respectively.

As of December 31, 2021, there was $684,000 of unrecognized compensation cost related to nonvested stock options, $180,000 
related to restricted stock and $19,443,000 related to nonvested RSUs. The stock options are expected to be recognized over a weighted 
average period of approximately 0.6 years, restricted stock over approximately 0.1 years and RSUs over approximately 3.1 years. 

The weighted average per share fair value of stock options granted during the years ended December 31, 2020 and 2019 was $20.19 
and $22.77, respectively. The fair value of the stock options granted during the years ended December 31, 2020 and 2019 was $2,314,000 
and $2,666,000, respectively. There were no stock options granted under the employee plan during the year ended December 31, 2021 
and no stock options granted under the director plan during the years ended December 31, 2021 and 2020.  The Company currently uses 
treasury stock shares for restricted stock grants, RSU vestings, and stock option exercises. The fair value of each stock option was 
determined using the Black-Scholes option pricing model. 

67

The key input variables used in valuing the stock options granted were as follows: 

Dividend yield
Average risk-free interest rate
Stock price volatility
Estimated option term

(9) Taxes on Income

Year Ended December 31,
2019
2020

None

1.3%
28%

None

2.5%
28%

5.3 years

5.3 years

Earnings (loss) before taxes on income and details of the provision (benefit) for taxes on income were as follows (in thousands): 

Earnings (loss) before taxes on income:

United States
Foreign

Provision (benefit) for taxes on income:

U.S. Federal:
Current
Deferred

U.S. State:
Current
Deferred

Foreign:

Current

Consolidated:
Current
Deferred

2021

Year Ended December 31,
2020

2019

(290,181) $
(420)
(290,601) $

(461,569) $
218
(461,351) $

190,839
(1,019)
189,820

(460) $

(48,843)
(49,303) $

(218,613) $
37,436
(181,177) $

1,560
4,424
5,984

$

$

(511) $
(511) $

$

3,421
(12,273)
(8,852) $

270
270

$
$

$

589
(44,419)
(43,830) $

(214,922) $
25,163
(189,759) $

(312)
45,133
44,821

76
1,706
1,782

198
198

(38)
46,839
46,801

$

$

$

$

$

$

$
$

$

$

On November 13, 2021, the voters of the state of Louisiana approved a constitutional amendment that removed the corporate tax 
deduction for federal income taxes paid and lowered the corporate income tax rate from 8% to 7.5% effective January 1, 2022.  The 
result of the amendment was an increase in the effective Louisiana state income tax rate, net of deduction for federal income tax, from 
6.3% to 7.5%.  As a result of the amendment, the Company recognized a one-time deferred tax provision of $5,656,000 during the fourth 
quarter of 2021 due to remeasuring the Company’s Louisiana and U.S. deferred tax assets and liabilities based on the new effective 
Louisiana state income tax rate.

On March 27, 2020, the United States Congress passed and the President signed the Coronavirus Aid, Relief, and Economic Security 
Act  (“CARES  Act”)  into  law  to  address  the  COVID-19  pandemic.    One  provision  of  the  CARES  Act  allows  net  operating  losses 
generated in 2018 through 2020 to be carried back up to five years.  Pursuant to this provision of the CARES Act, the Company recorded 
a  net  federal  current  benefit  for  taxes  on  income  for  the  year  ended  December  31,  2020  due  to  carrying  back  net  operating  losses 
generated between 2018 and 2020 used to offset taxable income generated between 2013 and 2017.  Net operating losses carried back 
to tax years 2013 through 2017 are applied at a federal tax rate of 35% applicable to those tax years, compared to a 21% tax rate effective 
at December 31, 2020.  Net operating losses generated in 2018 and 2019 were used to offset taxable income generated between 2013 
and 2017 taxed at 35% resulting in a tax benefit of $59,659,000 and a decrease in the company’s deferred tax asset related to federal net 
operating losses of $88,292,000.  

At December 31, 2021 and 2020, the Company had a federal income tax receivable of $70,973,000 and $188,177,000, respectively, 
included in Accounts Receivable – Other on the balance sheet.  During 2021, the Company received a tax refund of $119,493,000, 
including accrued interest, for its 2019 tax return related to net operating losses being carried back to offset taxable income generated 
between 2014 and 2017.    During 2020, the Company received a tax refund of $30,606,000 for its 2018 tax return related to net operating 
losses being carried back to offset taxable income generated during 2013.  

68

 
 
 
 
 
The Company’s provision (benefit) for taxes on income varied from the statutory federal income tax rate due to the following: 

United States income tax statutory rate
State and local taxes, net of federal benefit
CARES Act – net operating loss carryback
Other – net

2021

Year Ended December 31,
2020

2019

21.0%
(1.7)
—
(4.2)
15.1%

21.0%
1.2
21.3
(2.4)
41.1%

21.0%
0.7
—
3.0
24.7%

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and liabilities were as follows 

(in thousands): 

Deferred tax assets:

Allowance for doubtful accounts
Inventory
Insurance accruals
Deferred compensation
Unrealized loss on defined benefit plans
Goodwill and other intangibles
Operating loss carryforwards
Retirement benefits
Other

Valuation allowances

Deferred tax liabilities:

Property
Deferred state taxes
Other

December 31,

2021

2020

$

$

$

1,657
13,180
4,052
6,081
6,126
65,852
89,966
7,194
6,247
200,355
(20,095)
180,260

(655,550)
(83,491)
(15,371)
(754,412)
(574,152) $

1,793
13,496
4,864
6,040
15,929
44,487
82,186
7,444
5,480
181,719
(18,025)
163,694

(678,916)
(74,468)
(17,154)
(770,538)
(606,844)

During 2021, the Company generated a federal tax net operating loss mainly caused by taking the full cost deduction of purchased 

fixed assets. The deferred tax assets of $57,168,000 has been recorded at December 31, 2021. 

The Company had state operating loss deferred tax assets of $27,607,000 in 2021 and $23,482,000 in 2020. The valuation allowance 
for state deferred tax assets as of December 31, 2021 and 2020 was $14,904,000 and $12,819,000, respectively, related to the Company’s 
state net operating loss carryforwards based on the Company’s determination that it is more likely than not that the deferred tax assets 
will not be realized. Expiration of these state net operating loss carryforwards vary by state through 2028 and none will expire in fiscal 
2022. 

As of December 31, 2021, the Company had a Canadian net operating loss carryforward of $5,191,000 which expires between 2037 

and 2041. A full valuation allowance has been provided for this asset. 

The  Company  or  one  of  its  subsidiaries  files  income  tax  returns  in  the  United  States  federal  jurisdiction  and  various  state 
jurisdictions. The Company’s federal income tax returns for the 2017 through 2020 tax years are currently under examination. With few 
exceptions, the Company and its subsidiaries’ state income tax returns are open to audit under the statute of limitations for the 2015 
through 2020 tax years. 

As of December 31, 2021, the Company has provided a liability of $893,000 for unrecognized tax benefits related to various income 
tax  issues  which  includes  interest  and  penalties.  The  amount  that  would  impact  the  Company’s  effective  tax  rate,  if  recognized,  is 
$720,000, with the difference between the total amount of unrecognized tax benefits and the amount that would impact the effective tax 
rate being primarily related to the federal tax benefit of state income tax items. It is not reasonably possible to determine if the liability 
for unrecognized tax benefits will significantly change prior to December 31, 2022 due to the uncertainty of possible examination results.  

69

 
 
 
 
 
A reconciliation of the beginning and ending amount of the liability for unrecognized tax benefits is as follows (in thousands): 

Balance at beginning of year
Additions based on tax positions related to the current year
Additions for tax positions of prior years
Reductions for tax positions of prior years
Settlements
Balance at end of year

2021

Year Ended December 31,
2020

2019

$

$

783
13
281
(340)
—
737

$

$

883
262
114
(266)
(210)
783

$

$

1,443
51
58
(669)
—
883

The Company accounts for interest and penalties related to uncertain tax positions as part of its provision for federal and state 
income  taxes.  The  Company  recognized  net  benefit  of  $34,000,  $90,000,  and  $71,000  in  interest  and  penalties  for  the  years  ended 
December 31, 2021, 2020, and 2019, respectively. The Company had $138,000 and $172,000 of accrued liabilities for the payment of 
interest and penalties at December 31, 2021 and 2020, respectively. 

(10) Earnings Per Share

The following table presents the components of basic and diluted earnings (loss) per share (in thousands, except per share amounts):

Net earnings (loss) attributable to Kirby
Undistributed earnings allocated to restricted shares
Earnings (loss) available to Kirby common stockholders — basic
Undistributed earnings allocated to restricted shares
Undistributed earnings reallocated to restricted shares
Earnings (loss) available to Kirby common stockholders — diluted

Shares outstanding:
Weighted average common stock issued and outstanding
Weighted average unvested restricted stock
Weighted average common stock outstanding — basic
Dilutive effect of stock options and restricted stock units
Weighted average common stock outstanding — diluted

Net earnings (loss) per share attributable to Kirby common stockholders:

Basic
Diluted

2021
(246,954) $
—
(246,954)
—
—
(246,954) $

Year Ended December 31,
2020
(272,546) $
—
(272,546)
—
—
(272,546) $

60,099
(46)
60,053
—
60,053

60,021
(109)
59,912
—
59,912

2019

142,347
(369)
141,978
369
(369)
141,978

59,905
(155)
59,750
159
59,909

(4.11) $
(4.11) $

(4.55) $
(4.55) $

2.38
2.37

$

$

$
$

Certain outstanding options to purchase approximately 567,000, 681,000, and 187,000 shares of common stock were excluded in 
the computation of diluted earnings per share as of December 31, 2021, 2020, and 2019, respectively, as such stock options would have 
been  antidilutive.    Certain  outstanding  RSUs  to  convert  to  7,000  and  11,000  shares  of  common  stock  were  also  excluded  in  the 
computation of diluted earnings per share as of December 31, 2021 and 2020, respectively, as such RSUs would have been antidilutive.  
No RSUs were antidilutive at December 31, 2019.

(11) Inventories

The following table presents the details of inventories (in thousands): 

Finished goods
Work in process

December 31,

2021

2020

$

$

260,707
70,643
331,350

$

$

255,491
54,184
309,675

70

 
(12) Retirement Plans

The Company sponsors a defined benefit plan (the “Kirby Pension Plan”) for its inland vessel personnel and shore based tankermen. 
The plan benefits are based on an employee’s years of service and compensation. The plan assets consist primarily of equity and fixed 
income securities. 

On April 12, 2017, the Company amended the Kirby Pension Plan to cease all benefit accruals for periods after May 31, 2017 for 
certain participants. Participants grandfathered and not impacted were those, as of the close of business on May 31, 2017, who either (a) 
had completed 15 years of pension service or (b) had attained age 50 and completed 10 years of pension service. Participants non-
grandfathered are eligible to receive discretionary 401(k) plan contributions.

On February 14, 2018, with the acquisition of Higman, the Company assumed Higman’s pension plan (the “Higman Pension Plan”) 
for its inland vessel personnel and office staff. On March 27, 2018, the Company amended the Higman Pension Plan to close it to all 
new entrants and cease all benefit accruals for periods after May 15, 2018 for all participants.  The Company made contributions to the 
Higman  Pension  Plan  of  $479,000  in  2021,  $797,000  in  2020  for  the  2019  plan  year,  $1,438,000  in  2020  for  the  2020  plan  year, 
$1,615,000 in 2019 for the 2018 plan year, and $1,449,000 in 2019 for the 2019 plan year.  

The aggregate fair value of plan assets of the Company’s pension plans was $430,821,000 and $395,137,000 at December 31, 2021 

and 2020 respectively. Pension assets were allocated among asset categories as follows: 

Asset Category
U.S. equity securities
International equity securities
Debt securities
Cash and cash equivalents

December 31,

2021

2020

51%
20
29
—
100%

53%
20
25
2
100%

Current
Minimum, Target
and Maximum
Allocation Policy

30% — 50% — 70%
0% — 20% — 30%
15% — 30% — 55%
0% —   0% —   5%

At December 31, 2021 and 2020, $5,406,000 and $25,032,000, respectively, was held in cash as well as debt and equity securities 
classified within Level 1 of the valuation hierarchy, and $138,000 was held in real estate investments classified within Level 3 of the 
valuation hierarchy at December 31, 2020.  There were no investments within Level 3 of the valuation hierarchy at December 31, 2021.  
All other plan assets are invested in common collective trusts and valued using the net asset value per share practical expedient and 
therefore not valued within the valuation hierarchy. 

The  Company’s  investment  strategy  focuses  on  total  return  on  invested  assets  (capital  appreciation  plus  dividend  and  interest 
income). The primary objective in the investment management of assets is to achieve long-term growth of principal while avoiding 
excessive risk. Risk is managed through diversification of investments within and among asset classes, as well as by choosing securities 
that have an established trading and underlying operating history.

The Company makes various assumptions when determining defined benefit plan costs including, but not limited to, the current 
discount rate and the expected long-term return on plan assets. Discount rates are determined annually and are based on a yield curve 
that consists of a hypothetical portfolio of high quality corporate bonds with maturities matching the projected benefit cash flows. The 
Company assumed that plan assets would generate a long-term rate of return of 6.75% in both 2021 and 2020. The Company developed 
its expected long-term rate of return assumption by evaluating input from investment consultants comparing historical returns for various 
asset classes with its actual and targeted plan investments. The Company believes that its long-term asset allocation, on average, will 
approximate the targeted allocation.

The Company’s pension plan funding strategy is to make annual contributions in amounts equal to or greater than amounts necessary 
to meet minimum government funding requirements. The plan’s benefit obligations are based on a variety of demographic and economic 
assumptions, and the pension plan assets’ returns are subject to various risks, including market and interest rate risk, making an accurate 
prediction of the pension plan contribution difficult. The Company’s pension plan funding was 92% of the pension plans’ accumulated 
benefit obligation at December 31, 2021, including both the Kirby Pension Plan and the Higman Pension Plan.

The  Company  sponsors  an  unfunded  defined  benefit  health  care  plan  that  provides  limited  postretirement  medical  benefits  to 
employees who met minimum age and service requirements, and to eligible dependents. The plan limits cost increases in the Company’s 
contribution to 4% per year. The plan is contributory, with retiree contributions adjusted annually. The plan eliminated coverage for 
future retirees as of December 31, 2011. The Company also has an unfunded defined benefit supplemental executive retirement plan 
(“SERP”) that was assumed in an acquisition in 1999. That plan ceased to accrue additional benefits effective January 1, 2000.

71

 
The  following  table  presents  the  change  in  benefit  obligation  and  plan  assets  for  the  Company’s  defined  benefit  plans  and 

postretirement benefit plan (in thousands):

Pension Benefits

Pension Plans

SERP

Other Postretirement Benefits
Postretirement Welfare Plan

2021

2020

2021

2020

2021

2020

Change in benefit obligation
Benefit obligation at beginning of year

Service cost
Interest cost
Actuarial (gain) loss
Gross benefits paid
Settlements
Benefit obligation at end of year

Accumulated benefit obligation at end of 
year

Weighted-average assumption used to 
determine benefit obligation at end of year
Discount rate (a)
Rate of compensation increase

Health care cost trend rate

Initial rate
Ultimate rate
Years to ultimate

Change in plan assets
Fair value of plan assets at beginning of year
Actual return on plan assets
Employer contribution
Gross benefits paid
Settlements
Fair value of plan assets at end of year

$

$

$

$

$

508,694
7,961
14,239
(20,208)
(11,967)
(3,447)
495,272

$

$

442,861 $
7,671
15,630
58,851
(11,029)
(5,290)
508,694 $

1,174
—
31
(12)
(160)
—
1,033

469,508

$

479,999 $

1,033

$

$

$

1,225
—
40
55
(146)
—
1,174

1,174

$

$

$

3.0% / 3.1%
Service-
based table

2.8% / 2.9%
Service-based 
table

—
—
—

—
—
—

3.0%

2.8%

—

—
—
—

—

—
—
—

629
—
17
104
(168)
—
582

582

$

$

$

3.0%

—

6.25%
5.0%

2027

395,137
50,619
479
(11,967)
(3,447)
430,821

$

$

358,197 $
51,024
2,235
(11,029)
(5,290)
395,137 $

— $
—
160
(160)
—
— $

— $
—
146
(146)
—
— $

— $
—
168
(168)
—
— $

662
—
22
84
(139)
—
629

629

2.8%

—

6.50%
5.0%

2025

—
—
139
(139)
—
—

(a) The 2021 discount rate was 3.0% for the Kirby Pension Plan and 3.1% for the Higman Pension Plan.  The 2020 discount rate 

was 2.8% for the Kirby Pension Plan and 2.9% for the Higman Pension Plan.

During the year ended December 31, 2021, the decrease in the benefit obligation was primarily due to an increase in the discount 
rate and actual returns on plan assets performing better than expected.  During the year ended December 31, 2020, the increase in the 
benefit obligation was primarily due to the decrease in the discount rate, partially offset by actual returns on plan assets performing 
better than expected and an update of the actuarial tables.

At  December  31,  2021  and  2020,  both  the  accumulated  benefit  obligation  and  the  projected  benefit  obligations  of  each  of  the 

Company’s pension plans exceeded the fair value of plan assets.

72

The  following  table  presents  the  funded  status  and  amounts  recognized  in  the  Company’s  consolidated  balance  sheet  for  the 

Company’s defined benefit plans and postretirement benefit plan (in thousands):

Funded status at end of year
Fair value of plan assets
Benefit obligations

Funded status and amount recognized at end of 
year

Amounts recognized in the consolidated 
balance sheets

Current liability
Long-term liability

Amounts recognized in accumulated other 
comprehensive income

Net actuarial (gain) loss
Prior service cost (credit)
Accumulated other compensation income

$

$

$

$

Pension Benefits

Pension Plans

SERP

Other Postretirement Benefits
Postretirement Welfare Plan

2021

2020

2021

2020

2021

2020

430,821
(495,272)

$

395,137 $
(508,694)

— $

(1,033)

— $

(1,174)

— $

(582)

(64,451) $

(113,557) $

(1,033) $

(1,174) $

(582) $

—
(64,451)

—
(113,557)

(128)
(905)

(159)
(1,015)

(49)
(533)

—
(629)

(629)

(58)
(571)

32,600
—
32,600

$

$

81,376 $
—
81,376 $

428
—
428

$

$

480
—
480

$

$

(2,634) $
—
(2,634) $

(3,189)
—
(3,189)

The following table presents the expected cash flows for the Company’s defined benefit plans and postretirement benefit plan (in 

thousands):

Pension Plans

2021

2020

Pension Benefits

SERP

Other Postretirement Benefits
Postretirement Welfare Plan

2021

2020

2021

2020

Expected employer contributions

First year

Expected benefit payments (gross)

Year one
Year two
Year three
Year four
Year five
Next five years

$

$

145 $

2,385 $

— $

— $

— $

—

15,480 $
16,678
17,598
18,382
19,127
109,845

13,902 $
14,902
16,123
17,284
18,315
106,400

130 $
104
100
96
91
381

162 $
136
110
106
101
406

50 $
49
48
47
45
194

59
49
48
47
46
202

73

 
The  components  of  net  periodic  benefit  cost  and  other  changes  in  plan  assets  and  benefit  obligations  recognized  in  other 

comprehensive income for the Company’s defined benefit plans were as follows (in thousands):

Components of net periodic benefit cost

Service cost
Interest cost
Expected return on plan assets
Amortization of actuarial loss
Net periodic benefit cost

Other changes in plan assets and benefit 
obligations recognized in other 
comprehensive income

Current year actuarial (gain) loss
Recognition of actuarial loss
Total recognized in other comprehensive 
income

Pension Plans

2020

Pension Benefits

2019

2021

SERP
2020

2019

$

$

7,671
15,630
(23,790)
2,399
1,910

$

7,364
16,493
(20,956)
1,438
4,339

— $
31
—
40
71

— $
40
—
35
75

$

2021

7,961
14,239
(26,244)
4,193
149

(44,583)
(4,193)

31,616
(2,399)

(48,776)

29,217

6,497
(1,438)

5,059

(12)
(40)

(52)

55
(35)

20

—
52
—
28
80

73
(28)

45

Total recognized in net periodic benefit cost 
and other comprehensive income

$

(48,627)

$

31,127

$

9,398

$

19

$

95

$

125

Weighted average assumptions used to 
determine net periodic benefit cost
Discount rate (a)
Expected long-term rate of return on plan 
assets
Rate of compensation increase

2.8% / 2.9% 3.5% / 3.1%

6.75%

6.75%

4.4%

7.0%

Service-
based table

Service-
based table

Service-based 
table

2.8%

3.5%

4.4%

—

—

—

—

—

—

(a) The 2021 discount rate for benefit cost is 2.8% for the Kirby Pension Plan and 2.9% for the Higman Pension Plan.  The 2020 

discount rate for benefit cost is 3.5% for the Kirby Pension Plan and 3.1% for the Higman Pension Plan.

The components of net periodic benefit cost and other changes in benefit obligations recognized in other comprehensive income 

for the Company’s postretirement benefit plan were as follows (in thousands):

Components of net periodic benefit cost
Interest cost
Amortization of actuarial gain
Net periodic benefit cost

Other Postretirement Benefits
Postretirement Welfare Plan
2020

2021

2019

$

$

17
(451)
(434)

$

22
(522)
(500)

Other changes in benefit obligations recognized in other comprehensive 
income
Current year actuarial loss (gain)
Recognition of actuarial gain

Total recognized in other comprehensive income

104
451
555

84
522
606

31
(540)
(509)

(22)
540
518

Total recognized in net periodic benefit cost and other
   comprehensive income

$

121

$

106

$

9

Weighted average assumptions used to determine net periodic benefit 
cost
Discount rate
Health care cost trend rate:

Initial rate
Ultimate rate
Years to ultimate

74

2.8%

6.50%
5.0%

2025

3.5%

6.75%
5.0%

2025

4.4%

7.0%
5.0%

2025

The Company also contributes to a multiemployer pension plan pursuant to a collective bargaining agreement which covers certain 
vessel crew members of its coastal operations and expires on April 30, 2022. The Company began participation in the Seafarers Pension 
Trust (“SPT”) with the Penn Maritime, Inc. acquisition on December 14, 2012.

Contributions to the SPT are made currently based on a per day worked basis and charged to expense as incurred and included in 
costs of sales and operating expenses in the consolidated statement of earnings. During 2021 and 2020, the Company made contributions 
of $541,000 and $617,000, respectively, to the SPT. The Company’s contributions to the SPT exceeded 5% of total contributions to the 
SPT in 2020. Total contributions for 2021 are not yet available. The Company did not pay any material surcharges in 2021 and 2020.

The federal identification number of the SPT is 13-6100329 and the Certified Zone Status is Green at December 31, 2020. The 
Company’s future minimum contribution requirements under the SPT are unavailable because actuarial reports for the 2021 plan year 
are not yet complete and such contributions are subject to negotiations between the employers and the unions. The SPT was not in 
endangered or critical status for the 2020 plan year, the latest period for which a report is available, as the funded status was in excess 
of 100%. Based on the most recent communication from the SPT, there would be no withdrawal liability if the Company chose to 
withdraw from the SPT although the Company currently has no intention of terminating its participation in the SPT.

The Company also contributes to a multiemployer pension plan pursuant to a collective bargaining agreement which covers certain 
employees of its distribution and services segment in New Jersey and expires on October 8, 2023. The Company began participation in 
the  Central  Pension  Fund  of  the  International  Union  of  Operating  Engineers  and  Participating  Employers  (“CPF”)  with  the  S&S 
acquisition on September 13, 2017.

Contributions  to  the  CPF  are  made  currently  based  on  a  fixed  hourly  rate  for  each  hour  worked  or  paid  basis  (in  some  cases 
contributions are made as a percentage of gross pay) and charged to expense as incurred and included in costs of sales and operating 
expenses in the consolidated statement of earnings. During 2021 and 2020, the Company made contributions of $693,000 and $691,000, 
respectively,  to  the  CPF.  Total  contributions  for  the  2021  plan  year  are  not  yet  available.  The  Company  did  not  pay  any  material 
surcharges in 2021 and 2020.

The  federal  identification  number  of  the  CPF  is  36-6052390  and  the  Certified  Zone  Status  is  Green  at  January  31,  2021.  The 
Company’s future minimum contribution requirements under the CPF are unavailable because actuarial reports for the 2021 plan year, 
which ended January 31, 2022, are not yet complete and such contributions are subject to negotiations between the employers and the 
unions. The CPF was not in endangered or critical status for the 2020 plan year, ending January 31, 2021, the latest period for which a 
report is available, as the funded status was 98%. There would be no withdrawal liability if the Company chose to withdraw from the 
CPF although the Company currently has no intention of terminating its participation in the CPF.

In addition to the defined benefit plans, the Company sponsors various defined contribution plans for substantially all employees. 

The aggregate contributions to the plans were $25,853,000, $25,514,000, and $25,409,000 in 2021, 2020, and 2019, respectively.

(13) Other Comprehensive Income (Loss)

The Company’s changes in other comprehensive income (loss) were as follows (in thousands):

2021

Gross
Amount

Income Tax 
Provision

Net
Amount

Year Ended December 31,
2020
Income Tax 
(Provision) 
Benefit

Net
Amount

Gross
Amount

2019
Income Tax 
(Provision) 
Benefit

Gross
Amount

Net
Amount

Pension and postretirement 
benefits (a):
Amortization of net 
actuarial loss
Actuarial gains (losses)
Foreign currency 
translation adjustments
Total

$

3,782 $
44,491

(952) $

(10,774)

2,830 $
33,717

1,912 $

(31,755)

(483) $
7,006

1,429 $

926 $

(24,749)

(6,548)

(236) $
1,655

690
(4,893)

(1,061)

—

(1,061)

(333)

—

(333)

(85)

—

(85)

$

47,212 $

(11,726) $

35,486 $ (30,176) $

6,523

$

(23,653) $

(5,707) $

1,419

$

(4,288)

(a) Actuarial gains (losses) are amortized into other income (expense).  (See Note 12 – Retirement Plans)

75

(14) Contingencies and Commitments

In 2009, the Company was named by the Environmental Protection Agency (the “EPA”) as a Potentially Responsible Party (“PRP”) 
in  addition  to  a  group  of  approximately  250  named  PRPs  under  the  Comprehensive  Environmental  Response,  Compensation  and 
Liability Act of 1981 (“CERCLA”) with respect to a Superfund site, the Portland Harbor Superfund site (“Portland Harbor”) in Portland, 
Oregon.  The  site  was  declared  a  Superfund  site  in  December  2000  as  a  result  of  historical  heavily  industrialized  use  due  to 
manufacturing, shipbuilding, petroleum storage and distribution, metals salvaging, and electrical power generation activities which led 
to contamination of Portland Harbor, an urban and industrial reach of the lower Willamette River located immediately downstream of 
downtown Portland. The Company’s involvement arises from four spills at the site after it was declared a Superfund site, as a result of 
predecessor entities’ actions in the area. To date, there is no information suggesting the extent of the costs or damages to be claimed 
from the 250 notified PRPs. Based on the nature of the involvement at the Portland Harbor site, the Company believes its potential 
contribution is de minimis; however, to date neither the EPA nor the named PRPs have performed an allocation of potential liability in 
connection with the site nor have they provided costs and expenses in connection with the site.

On February 20, 2015, the Company was served as a defendant in a Complaint originally filed on August 14, 2014, in the U.S. 
District Court of the Southern District of Texas - Houston Division, USOR Site PRP Group vs. A&M Contractors, USES, Inc. et al. This 
is a civil action pursuant to the provisions of CERCLA and the Texas Solid Waste Disposal Act for recovery of past and future response 
costs incurred and to be incurred by the USOR Site PRP Group for response activities at the U.S. Oil Recovery Superfund Site. The 
property  was  a  former  sewage  treatment  plant  owned  by  defendant  City  of  Pasadena,  Texas  from  approximately  1945  until  it  was 
acquired by U.S. Oil Recovery in January 2009. Throughout its operating life, the U.S. Oil Recovery facility portion of the USOR Site 
received  and  performed  wastewater  pretreatment  of  municipal  and  Industrial  Class  I  and  Class  II  wastewater,  characteristically 
hazardous waste, used oil and oily sludges, and municipal solid waste. Associated operations were conducted at the MCC Recycling 
facility portion of the USOR Site after it was acquired by U.S. Oil Recovery from the City of Pasadena in January 2009. The EPA and 
the PRP Group entered into an Administrative Settlement Agreement and Order for Remedial Investigation Study (“Study”) in May 
2015. The Study has not been completed by EPA to date. The Company joined as a member of the PRP Group companies at its pro-rata 
allocated share.

On October 13, 2016, the Company, as a successor to Hollywood Marine, Inc. (“Hollywood Marine”), was issued a General Notice 
under CERCLA by the EPA in which it was named as a PRP for liabilities associated with the SBA Shipyard Site located near Jennings, 
Louisiana (the “Site”). The Site was added to the EPA’s National Priorities List of sites under CERCLA in September 2016. SBA used 
the facility for construction, repair, retrofitting, sandblasting, and cleaning and painting of barges beginning in 1965. Three barge slips 
and a dry dock are located off the Mermentau River. The slips were used to dock barges during cleaning or repair. In 2001, a group of 
PRPs  that  had  been  former  customers  of  the  SBA  Shipyard  facility  formed  an  organization  called  the  SSIC  Remediation,  LLC 
(hereinafter, “the PRP Group Companies”) to address removal actions at the Site. In 2002, EPA approved an Interim Measures/Removal 
Action of Hazardous/Principal Threat Wastes at SBA Shipyards, Inc. (pursuant to RCRA Section 3008(h)) that was proposed by SBA 
Shipyard and the PRP Group Companies. Interim removal activities were conducted from March 2001 through January 2005 under an 
EPA 2002 Order and Agreement. In September 2012, the Louisiana Department of Environmental Quality requested EPA address the 
Site under CERCLA authority. The Company, as a successor to Hollywood Marine, joined the PRP Group Companies. The PRP Group 
Companies have submitted a draft Study work plan to EPA for their review and comment. Higman was named as a PRP in connection 
with its activities at the Site. Higman is not a participant in the PRP Group Companies.

With respect to the above sites, the Company has accrued a liability, if applicable, for its estimated potential liability for its portion 
of  the  EPA’s  past  costs  claim  based  on  information  developed  to  date  including  various  factors  such  as  the  Company’s  liability  in 
proportion to other PRPs and the extent to which such costs are recoverable from third parties.

On May 10, 2019, two tank barges and a towboat, the M/V Voyager, owned and operated by Kirby Inland Marine, LP (“Kirby 
Inland Marine”), a wholly owned subsidiary of the Company, were struck by the LPG tanker, the Genesis River, in the Houston Ship 
Channel. The bow of the Genesis River penetrated the Kirby 30015T and capsized the MMI 3014. The collision penetrated the hull of 
the  Kirby  30015T  causing  its  cargo,  reformate,  to  be  discharged  into  the  water.  The  United  States  Coast  Guard  (“USCG”)  and  the 
National Transportation Safety Board (“NTSB”) designated the owner and pilot of the Genesis River as well as the subsidiary of the 
Company as parties of interest in their investigation into the cause of the incident. On June 19, 2019, the Company filed a limitation 
action in the U.S. District Court of the Southern District of Texas - Galveston Division seeking limitation of liability and asserting that 
the Genesis River and her owner/manager are at fault for damages including removal costs and claims under the Oil Pollution Act of 
1990 and maritime law. Multiple claimants have filed claims in the limitation seeking damages under the Oil Pollution Act of 1990.  
The court bifurcated the matter into two trials, the first to determine liability amongst the parties and the second to assess damages. The 
Company entered into a settlement agreement resolving claims of natural resource damage arising out of the spill. Under the agreement, 
the Company agreed to pay state and federal natural resource trustees $2,102,000. The liability trial was conducted during the week of 
February 2, 2021.  The Court issued its decision on July 8, 2021, finding that the Genesis River was solely at fault and no liability on 
the part of Kirby Inland Marine.  No appeal was filed by the Genesis River.  The Company and its insurance carriers collected the 
$20,206,000 judgment from the Genesis River and its interests.

76

On October 13, 2016, the tug Nathan E. Stewart and barge DBL 55, an ATB owned and operated by Kirby Offshore Marine, LLC, 
a wholly owned subsidiary of the Company, ran aground at the entrance to Seaforth Channel on Atholone Island, British Columbia. The 
grounding resulted in a breach of a portion of the Nathan E. Stewart’s fuel tanks causing a discharge of diesel fuel into the water. The 
USCG and the NTSB designated the Company as a party of interest in their investigation as to the cause of the incident. The Canadian 
authorities including Transport Canada and the Canadian Transportation Safety Board investigated the cause of the incident. On October 
10, 2018, the Heiltsuk First Nation filed a civil action in the British Columbia Supreme Court against a subsidiary of the Company, the 
master and pilot of the tug, the vessels and the Canadian government seeking unquantified damages as a result of the incident. On May 
1, 2019, the Company filed a limitation action in the Federal Court of Canada seeking limitation of liability relating to the incident as 
provided under admiralty law. The Heiltsuk First Nation’s civil claim has been consolidated into the Federal Court limitation action as 
of July 26, 2019 and it is expected that the Federal Court of Canada will decide all claims against the Company. The Company is unable 
to estimate the potential exposure in the civil proceeding.  The Company has various insurance policies covering liabilities including 
pollution,  property,  marine  and  general  liability  and  believes  that  it  has  satisfactory  insurance  coverage  for  the  cost  of  cleanup  and 
salvage operations as well as other potential liabilities arising from the incident. The Company believes its accrual of such estimated 
liability  is  adequate  for  the  incident  and  does  not  expect  the  incident  to  have  a  material  adverse  effect  on  its  business  or  financial 
condition.

On March 22, 2014, two tank barges and a towboat, the M/V Miss Susan, owned by Kirby Inland Marine, were involved in a 
collision with the M/S Summer Wind on the Houston Ship Channel near Texas City, Texas. The lead tank barge was damaged in the 
collision resulting in a discharge of intermediate fuel oil from one of its cargo tanks.  While all legal action to date involving the Company 
has been resolved, the Company is participating in the natural resource damage assessment and restoration process with federal and state 
government  natural  resource  trustees.    In  December  2021,  the  Company  agreed  to  pay  $15,300,000  in  damages  resulting  from  this 
incident, and a proposed consent decree.  On January 20, 2022, the federal court approved the consent decree.  The matter concluded 
following the Company's payment of damages to federal and state trustees in accordance with the terms of the consent decree.

In addition, the Company is involved in various legal and other proceedings which are incidental to the conduct of its business, 
none of which in the opinion of management will have a material effect on the Company’s financial condition, results of operations or 
cash flows. Management believes its accrual of such estimated liability is adequate and believes that it has adequate insurance coverage 
or has meritorious defenses for these other claims and contingencies.

Certain Significant Risks and Uncertainties. The preparation of financial statements in conformity with United States generally 
accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and 
liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues 
and expenses during the reporting period. Actual results could differ from those estimates. However, in the opinion of management, the 
amounts would be immaterial.

The  customer  base  of  the  marine  transportation  segment  includes  major  industrial  petrochemical  and  chemical  manufacturers, 
refining companies and agricultural chemical manufacturers operating in the United States. During 2021, approximately 65% of marine 
transportation’s inland revenues were from movements of such products under term contracts, typically ranging from one year to three 
years, some with renewal options. During 2021, approximately 80% of the marine transportation’s coastal revenues were under term 
contracts. While the manufacturing and refining companies have generally been customers of the Company for numerous years (some 
as long as 40 years) and management anticipates a continuing relationship, there is no assurance that any individual contract will be 
renewed. No single customer of the marine transportation segment accounted for 10% or more of the Company’s revenues in 2021, 
2020, or 2019.

Major customers of the distribution and services segment include oilfield service companies, oil and gas operators and producers, 
inland and offshore barge operators, offshore fishing companies, on-highway transportation companies, construction companies, the 
United States government, and power generation, nuclear and industrial companies.

The results of the distribution and services segment are largely tied to the industries it serves and, therefore, can be influenced by 
the cycles of such industries. No single customer of the distribution and services segment accounted for 10% or more of the Company’s 
revenues in 2021, 2020, or 2019.

United  Holdings  LLC  (“United”)  has  maintained  continuous  exclusive  distribution  rights  for  MTU  and  Allison  Transmission 
products  since  1946.  United  is  one  of  MTU’s  top  five  distributors  of  MTU  off-highway  engines  in  North  America  with  exclusive 
distribution rights in Oklahoma, Arkansas, Louisiana and Mississippi. In addition, as a distributor of Allison Transmission products, 
United has distribution rights in Oklahoma, Arkansas and Louisiana. United is also the distributor for parts service and warranty on 
Daimler Truck North America (“DTNA”) engines and related equipment in Oklahoma, Arkansas and Louisiana.  United, though certain 
of its subsidiaries, is also a dealer of Thermo King refrigeration systems for trucks, railroad cars, and other land transportation markets 
in Texas and Colorado.

77

S&S is also one of MTU’s top five distributors for off-highway engines with exclusive distribution rights in multiple states. S&S 
also has authorized exclusive distribution rights for Allison Transmission, Detroit Diesel, Deutz, DTNA, EMD, Rolls Royce Power and 
Volvo Penta diesel engines in multiple key growth states, primarily through the Central, South and Eastern parts of the United States 
and strategically located near major oil and gas fields, marine waterways and on-highway transportation routes. In addition, S&S has 
long-term relationships with numerous smaller suppliers including Donaldson, Freightliner, Generac and John Deere.

Kirby Engine Systems LLC, through Marine Systems, Inc. and Engine Systems, Inc. (“Engine Systems”), operates as an authorized 
EMD distributor throughout the United States. Engine Systems is also the authorized EMD distributor for nuclear power applications 
worldwide. The relationship with EMD has been maintained for 56 years. The segment also operates factory-authorized full service 
marine distributorship/dealerships for Cummins, Detroit Diesel and John Deere high-speed diesel engines and Falk, Lufkin and Twin 
Disc marine gears, as well as an authorized marine dealer for Caterpillar diesel engine in multiple states.

Physical impacts of climate change could have a material adverse effect on the Company's costs and operations.  There has been 
public discussion that climate change may be associated with rising sea levels as well as extreme weather conditions such as more 
intense  hurricanes,  thunderstorms,  tornadoes,  drought,  and  snow  or  ice  storms.    Weather  can  be  a  major  factor  in  the  day-to-day 
operations of the marine transportation segment. Adverse weather conditions, such as high or low water, tropical storms, hurricanes, 
tsunamis, fog and ice, can impair the operating efficiencies of the marine fleet.  Shipments of products can be delayed or postponed by 
weather conditions, which are totally beyond the control of the Company. Adverse water conditions are also factors which impair the 
efficiency of the fleet and can result in delays, diversions and limitations on night passages, and dictate horsepower requirements and 
size of tows. Additionally, much of the inland waterway system is controlled by a series of locks and dams designed to provide flood 
control, maintain pool levels of water in certain areas of the country and facilitate navigation on the inland river system. Maintenance 
and operation of the navigable inland waterway infrastructure is a government function handled by the Army Corps of Engineers with 
costs shared by industry. Significant changes in governmental policies or appropriations with respect to maintenance and operation of 
the infrastructure could adversely affect the Company.  The Company’s distribution and services segment is also subject to tropical 
storms and hurricanes impacting its coastal locations and those of its customers as well as tornados impacting its Oklahoma facilities. 
The risk of flooding as a result of hurricanes and tropical storms as well as other weather events may impede travel via roadways, 
suspend service work, and impact deliveries and the Company’s ability to fulfill orders or provide services in the distribution and services 
segment.

The Company’s marine transportation segment is subject to regulation by the USCG, federal laws, state laws, the laws of other 
countries when operating in their waters, and certain international conventions, as well as numerous environmental regulations. The 
Company believes that additional safety, environmental and occupational health regulations may be imposed on the marine industry. 
There can be no assurance that any such new regulations or requirements, or any discharge of pollutants by the Company, will not have 
an adverse effect on the Company.

The Company’s marine transportation segment competes principally in markets subject to the Jones Act, a federal cabotage law 
that restricts domestic marine transportation in the United States to vessels built and registered in the United States, and manned, owned 
and  operated  by  United  States  citizens.  The  Jones  Act  cabotage  provisions  occasionally  come  under  attack  by  interests  seeking  to 
facilitate foreign flagged competition in trades reserved for domestic companies and vessels under the Jones Act. The Company believes 
that continued efforts will be made to modify or eliminate the cabotage provisions of the Jones Act. If such efforts are successful, certain 
elements could have an adverse effect on the Company. However, the Company believes that it is unlikely that the current cabotage 
provisions of the Jones Act would be eliminated or significantly modified in a way that has a material adverse impact on the Company 
in the foreseeable future.

The Company has issued guaranties or obtained standby letters of credit and performance bonds supporting performance by the 
Company and its subsidiaries of contractual or contingent legal obligations of the Company and its subsidiaries incurred in the ordinary 
course of business. The aggregate notional value of these instruments is $19,357,000 at December 31, 2021, including $12,055,000 in 
letters of credit and $7,302,000 in performance bonds. All of these instruments have an expiration date within two years. The Company 
does not believe demand for payment under these instruments is likely and expects no material cash outlays to occur in connection with 
these instruments.

(15) Related Party Transactions

David W. Grzebinski, President and Chief Executive Officer of the Company, is a member of the board of directors for ABS, a not-
for-profit that provides global classification services to the marine, offshore and gas industries.  The Company paid ABS $1,620,000 in 
2021, $2,377,000 in 2020, and $1,774,000 in 2019 to perform audits and surveys of the Company’s vessels in the ordinary course of 
business.

78

In November 2020, Mr. Grzebinski became a member of the board of directors of UK Protection & Indemnity Association ("UK 
P&I"), a mutual marine protection and indemnity organization that provides protection and indemnity insurance for third party liabilities 
and expenses arising from vessel operations.  The Company’s marine fleet is insured on a pro rata share basis through UK P&I and 
Standard Mutual.  The Company paid $3,215,000 during 2021 in premiums for coverage in the 2021-2022 policy period and $3,000,000 
during 2020, in premiums for coverage in the 2020-2021 policy period in the ordinary course of business.

In January 2019, Amy D. Husted, Vice President, General Counsel and Secretary of the Company, became a member of the board 
of directors of Signal Mutual Indemnity Association Ltd (“Signal”), a group self-insurance not-for-profit organization authorized by the 
U.S. Department of Labor as a longshore worker’s compensation insurance provider.  The Company has been a member of Signal since 
it was established in 1986.  The Company paid Signal $551,000 in 2021, $667,000 in 2020 and $1,391,000 in 2019 in the ordinary 
course of business.

The husband of Ms. Husted is a partner in the law firm of Clark Hill PLC. The Company paid the law firm $2,900,000 in 2021, 

$1,598,000 in 2020, and $1,278,000 in 2019 for legal services in connection with matters in the ordinary course of business.

79

PART IV

Item 15. Exhibits and Financial Statement Schedules

1. Financial Statements

Included in Part III of this report on pages 47 to 79:

Report of Independent Registered Public Accounting Firm (KPMG LLP, Houston, TX, PCAOB ID 185).
Report of Independent Registered Public Accounting Firm.
Consolidated Balance Sheets, December 31, 2021 and 2020.
Consolidated Statements of Earnings, for the years ended December 31, 2021, 2020, and 2019.
Consolidated Statements of Comprehensive Income, for the years ended December 31, 2021, 2020, and 2019.
Consolidated Statements of Cash Flows, for the years ended December 31, 2021, 2020, and 2019.
Consolidated Statements of Stockholders’ Equity, for the years ended December 31, 2021, 2020, and 2019.
Notes to Consolidated Financial Statements, for the years ended December 31, 2021, 2020, and 2019.

2. Financial Statement Schedules

All  schedules  are  omitted  as  the  required  information  is  inapplicable  or  the  information  is  presented  in  the  consolidated  financial 
statements or related notes.

3. Exhibits

Exhibit
Number
3.1

3.2

3.3

4.1

4.2

10.1

10.2

EXHIBIT INDEX

Description of Exhibit

— Restated Articles of Incorporation of the Company with all amendments to date (incorporated by reference to Exhibit 

3.1 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2014).

— Bylaws of the Company, as amended to March 17, 2020 (incorporated by reference to Exhibit 3.2 to the Registrant’s 

Annual Report on Form 10-K for the year ended December 31, 2014).

— Amendment to Bylaws of Kirby Corporation dated March 18, 2020 (incorporated by reference to Exhibit 3.1 to the 

Registrant’s Current Report on Form 8-K filed with the Commission on March 19, 2020).

— See Exhibits 3.1, 3.2, and 3.3 hereof for provisions of our Restated Articles of Incorporation of the Company with all 
amendments to date and the Bylaws of the Company, as amended to date (incorporated by reference to Exhibit 3.1 and 
3.2, respectively, to the Registrant's Annual Report on Form 10-K for the year ended December 31, 2014 and Exhibit 
3.1 to the Registrant’s Current Report on Form 8-K filed with the Commission on March 19, 2020).

— Long-term  debt  instruments  are  omitted  pursuant  to  Item  601(b)(4)  of  Regulation  S-K.  The  Registrant  will  furnish 

copies of such instruments to the Commission upon request.

— Note Purchase Agreement dated February 3, 2022 (incorporated by reference to Exhibit 10.1 to the Registrant's Form 

8-K filed with the Commission on February 8, 2022

— Amended  and  Restated  Credit  Agreement  dated  as  of  March  27,  2019  among  Kirby  Corporation,  JPMorgan  Chase 
Bank, N.A., as Administrative Agent, and the banks named therein (incorporated by reference to Exhibit 10.1 to the 
Registrant’s Current Report on Form 8-K filed with the Commission on April 2, 2019).

10.3†

— Deferred Compensation Plan for Key Employees (incorporated by reference to Exhibit 10.7 to the Registrant’s Annual 

Report on Form 10-K for the year ended December 31, 2005).

10.4†*
10.5†*
10.6†*
10.7†

10.8†

10.9†

— Amendment to the Deferred Compensation Plan for Key Employees dated December 31, 2008.
— Amendment to the Deferred Compensation Plan for Key Employees dated April 24, 2018.
— Amendment to the Deferred Compensation Plan for Key Employees dated February 9, 2022.
— Incentive and Retention Award Agreement of David W. Grzebinski dated February 25, 2021 (incorporated by reference 
to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed with the Commission on February 26, 2021).
— Incentive and Retention Award Agreement of Christian G. O’Neil dated February 25, 2021 (incorporated by reference 
to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed with the Commission on February 26, 2021).
— Incentive and Retention Award Agreement of Joseph H. Reniers dated February 25, 2021 (incorporated by reference to 

Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed with the Commission on February 26, 2021).

10.10†

— Annual Incentive Plan Guidelines for 2021 (incorporated by reference to Exhibit 10.4 to the Registrant’s Annual Report 

on Form 10-K for the year ended December 31, 2020).

10.11†* — Annual Incentive Plan Guidelines for 2022.
10.12†

— 2005 Stock and Incentive Plan (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 

8-K filed with the Commission on April 29, 2021).

80

Exhibit
Number
10.13†

— 2000 Nonemployee Director Stock Plan (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report 

on Form 8-K filed with the Commission on April 29, 2021).

Description of Exhibit

10.14

— Nonemployee Director Compensation Program (incorporated by reference to Exhibit 10.2 to the Registrant’s Quarterly 

Report on Form 10-Q for the quarter ended March 31, 2018).

21.1*
23.1*
31.1*
31.2*
32*

— Consolidated Subsidiaries of the Registrant.
— Consent of Independent Registered Public Accounting Firm.
— Certification of Chief Executive Officer Pursuant to Rule 13a-14(a).
— Certification of Chief Financial Officer Pursuant to Rule 13a-14(a).
— Certification Pursuant to 18 U.S.C. Section 1350 (As adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 

2002).

101.INS* — Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL 

tags are embedded within the Inline XBRL document

101.SCH* — Inline XBRL Taxonomy Extension Schema Document
101.CAL* — Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF* — Inline XBRL Taxonomy Extension Definitions Linkbase Document
101.LAB* — Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE* — Inline XBRL Taxonomy Extension Presentation Linkbase Document
104*

— Cover Page Interactive Data File (embedded within the Inline XBRL document)

* Filed herewith.
† Management contract, compensatory plan or arrangement.

Item 16. Form 10-K Summary

Not applicable

81

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this 

report to be signed on its behalf by the undersigned, thereunto duly authorized.

SIGNATURES

KIRBY CORPORATION
(REGISTRANT)

By:

/s/ RAJ KUMAR
Raj Kumar
Executive Vice President and
Chief Financial Officer

Dated: February 18, 2022

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons 

on behalf of the registrant and in the capacities and on the dates indicated.

Signature

Capacity

Date

/s/ JOSEPH H. PYNE
Joseph H. Pyne

/s/ DAVID W. GRZEBINSKI
David W. Grzebinski

/s/ RAJ KUMAR
Raj Kumar

/s/ RONALD A. DRAGG
Ronald A. Dragg

/s/ ANNE-MARIE N. AINSWORTH
Anne-Marie N. Ainsworth

/s/ RICHARD J. ALARIO
Richard J. Alario

/s/ TANYA S. BEDER
Tanya S. Beder

/s/ BARRY E. DAVIS
Barry E. Davis

/s/ C. SEAN DAY
C. Sean Day

/s/ RICHARD R. STEWART
Richard R. Stewart

/s/ WILLIAM M. WATERMAN
William M. Waterman

/s/ SHAWN D. WILLIAMS
Shawn D. Williams

Chairman of the Board and Director

February 18, 2022

President, Chief Executive Officer,
and Director
(Principal Executive Officer)

Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)

Vice President, Controller and
Assistant Secretary
(Principal Accounting Officer)

Director

Director

Director

Director

Director

Director

Director

Director

82

February 18, 2022

February 18, 2022

February 18, 2022

February 18, 2022

February 18, 2022

February 18, 2022

February 18, 2022

February 18, 2022

February 18, 2022

February 18, 2022

February 18, 2022

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
CERTIFICATION OF CHIEF EXECUTIVE OFFICER

EXHIBIT 31.1

In connection with the filing of the report on Form 10-K for the year ended December 31, 2021 by Kirby Corporation, David W. 

Grzebinski certifies that:

1.    I have reviewed this report on Form 10-K of Kirby Corporation (the “registrant”);

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact 
necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with 
respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all 
material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in 
this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures 
(as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act 
Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under 
our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known 
to us by others within those entities, particularly during the period in which this report is being prepared;

b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be 
designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation 
of financial statements for external purposes in accordance with generally accepted accounting principles;

c)        Evaluated  the  effectiveness  of  the  registrant’s  disclosure  controls  and  procedures  and  presented  in  this  report  our 
conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report 
based on such evaluation; and

d)    Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the 
registrant’s  most  recent  fiscal  quarter  (the  registrant’s  fourth  fiscal  quarter  in  the  case  of  an  annual  report)  that  has  materially 
affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over 
financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the 
equivalent functions):

a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting 
which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; 
and

b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the 

registrant’s internal control over financial reporting.

Dated: February 18, 2022

/s/ DAVID W. GRZEBINSKI
David W. Grzebinski
President and Chief Executive Officer

 
 
 
CERTIFICATION OF CHIEF FINANCIAL OFFICER

EXHIBIT 31.2

In connection with the filing of the report on Form 10-K for the year ended December 31, 2021 by Kirby Corporation, Raj Kumar 

certifies that:

1.    I have reviewed this report on Form 10-K of Kirby Corporation (the “registrant”);

2.    Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact 
necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with 
respect to the period covered by this report;

3.    Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all 
material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in 
this report;

4.    The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures 
(as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act 
Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a)    Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under 
our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known 
to us by others within those entities, particularly during the period in which this report is being prepared;

b)    Designed such internal control over financial reporting, or caused such internal control over financial reporting to be 
designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation 
of financial statements for external purposes in accordance with generally accepted accounting principles;

c)        Evaluated  the  effectiveness  of  the  registrant’s  disclosure  controls  and  procedures  and  presented  in  this  report  our 
conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report 
based on such evaluation; and

d)    Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the 
registrant’s  most  recent  fiscal  quarter  (the  registrant’s  fourth  fiscal  quarter  in  the  case  of  an  annual  report)  that  has  materially 
affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.    The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over 
financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the 
equivalent functions):

a)    All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting 
which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; 
and

b)    Any fraud, whether or not material, that involves management or other employees who have a significant role in the 

registrant’s internal control over financial reporting.

Dated: February 18, 2022

/s/ RAJ KUMAR
Raj Kumar
Executive Vice President and
Chief Financial Officer

 
 
 
Certification Pursuant to Section 18 U.S.C. Section 1350
(As adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002)

EXHIBIT 32

In connection with the filing of the Annual Report on Form 10-K for the year ended December 31, 2021 (the “Report”) by Kirby 

Corporation (the “Company”), each of the undersigned hereby certifies that:

1.    The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; 

and

2.    The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations 

of the Company.

/s/ DAVID W. GRZEBINSKI
David W. Grzebinski
President and Chief Executive Officer

/s/ RAJ KUMAR
Raj Kumar
Executive Vice President and
Chief Financial Officer

Dated: February 18, 2022