KIRBY CORP

Previous wording

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, 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.

Current wording

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, pandemics, marine accidents, lock delays or closures, 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.

Previous wording

For purposes of Management’s Discussion, all net earnings per share attributable to Kirby common stockholders are “diluted earnings per share.” The weighted average number of common shares outstanding applicable to diluted earnings per share for 2024, 2023, and 2022 were 58,355,000, 59,857,000, and 60,329,000, respectively. Refer to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 for management's discussion and analysis of financial condition and results of operations for 2023 compared to 2022.

Current wording

For purposes of Management’s Discussion, all net earnings per share attributable to Kirby common stockholders are “diluted earnings per share.” The weighted average number of common shares outstanding applicable to diluted earnings per share for 2025, 2024, and 2023 were 56,045,000, 58,355,000, and 59,857,000, respectively. Refer to the Company’s Annual Report on Form 10-K for the year ended December 31, 2024 for management's discussion and analysis of financial condition and results of operations for 2024 compared to 2023.

Previous wording

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. In addition, the Company participates in the transportation of dry-bulk commodities in United States coastwise trade. Through KDS, the Company provides after-market services 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, construction equipment and refrigeration trailers for use in a variety of industrial markets. The Company also manufactures and remanufactures specialized equipment, including pressure pumping units, electric power generation equipment, and specialized electrical distribution and control equipment for oilfield service, railroad and other industrial customers.

Current wording

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. In addition, the Company participates in the transportation of dry-bulk commodities in United States coastwise trade. Through KDS, the Company provides equipment, after-market parts and services for power generation systems in applications that include behind the meter power systems and emergency backup systems, after-market and genuine replacement parts and services for engines, transmissions, reduction gears, electric motors, drives, and controls, specialized electrical distribution and controls systems, and related equipment used in power generation, marine, on-highway, oilfield services, and other industrial applications. The Company also rents equipment including generators, industrial compressors, high-capacity lift trucks, construction equipment and refrigeration trailers for use in a variety of industrial markets. The Company also manufactures and remanufactures specialized equipment, including pressure pumping units and electric fracturing systems, electric power generation equipment, and specialized electrical distribution and control equipment for data centers, oilfield service, railroad and other industrial customers.

Previous wording

The 2024 fourth quarter included a $56.3 million before taxes, $43.0 million after taxes, or $0.74 per share non-cash impairment charge in the KDS segment primarily associated with conventional diesel fracturing equipment inventory. Based on the current market conditions and its view on the industry outlook, including decreased customer demand for conventional diesel fracturing equipment driven by an industry-wide shift to electric fracturing equipment, the Company determined that certain inventory had limited commercial opportunity, and the cost of these inventories exceeded its net realizable value. The Company’s 2024 fourth quarter results also included a $10.9 million, or $0.19 per share one-time deferred tax credit related to a change in Louisiana tax law. Tax reform legislation in Louisiana was signed in December 2024 that included lowering the corporate income tax rate from 7.5% to 5.5% effective January 1, 2025. As a result of the new legislation, the Company recognized a one-time deferred tax credit of $10.9 million in the 2024 fourth quarter due to the remeasurement of the Company’s Louisiana and U.S. deferred tax assets and liabilities based on the new effective Louisiana state income tax rate.

Current wording

The 2024 fourth quarter included a $56.3 million before taxes, $43.0 million after taxes, or $0.74 per share non-cash impairment charge in the KDS segment primarily associated with conventional diesel fracturing equipment inventory. Based on market conditions at that time and its view on the industry outlook, including decreased customer demand for conventional diesel fracturing equipment driven by an industry-wide shift to electric fracturing equipment, the Company determined that certain inventory had limited commercial opportunity, and the cost of these inventories exceeded its net realizable value. The Company’s 2024 fourth quarter results also included a $10.9 million, or $0.19 per share one-time deferred tax credit related to a change in Louisiana tax law. Tax reform legislation in Louisiana was signed in December 2024 that included lowering the corporate income tax rate from 7.5% to 5.5% effective January 1, 2025. As a result of the new legislation, the Company recognized a one-time deferred tax credit of $10.9 million in the 2024 fourth quarter due to the remeasurement of the Company’s Louisiana and U.S. deferred tax assets and liabilities based on the new effective Louisiana state income tax rate.

Previous wording

Cash provided by operating activities in 2024 increased compared to 2023 primarily due to higher business activity levels. During 2024, capital expenditures of $342.7 million included $247.8 million in KMT and $94.9 million in KDS and corporate, more fully described under cash flow and capital expenditures below.

Current wording

Cash provided by operating activities in 2025 decreased compared to 2024 primarily due to unfavorable working capital changes, partially offset by higher business activity levels. During 2025, capital expenditures of $264.5 million included $229.1 million in KMT and $35.4 million in KDS and corporate, more fully described under cash flow and capital expenditures below.

Previous wording

The Company projects net cash flow from operations in 2025 of between $620 million and $720 million and expects capital expenditures to range between $280 million and $320 million. The Company has applied for and been awarded grants related to certain emission reduction projects totaling approximately $4 million which it expects to receive reimbursements for in 2025.

Current wording

The Company projects net cash flow from operations in 2026 of between $575 million and $675 million and expects capital expenditures to range between $220 million and $260 million.

Previous wording

The Company’s debt-to-capitalization ratio decreased to 20.7% at December 31, 2024 from 24.2% at December 31, 2023, primarily due an increase in total equity, primarily from net earnings attributable to Kirby of $286.7 million during 2024 and a reduction of debt outstanding of $141.6 million, partially offset by treasury stock purchases of $174.6 million. The Company’s debt outstanding as of December 31, 2024 and December 31, 2023 is detailed in Long-Term Financing below.

Current wording

The Company’s debt-to-capitalization ratio increased to 21.4% at December 31, 2025 from 20.7% at December 31, 2024, primarily due to an increase in debt outstanding of $44.3 million, partially offset by an increase in total equity, primarily from net earnings attributable to Kirby of $354.6 million during 2025 partially offset by treasury stock purchases of $354.2 million. The Company’s debt outstanding as of December 31, 2025 and December 31, 2024 is detailed in Long-Term Financing below.

Previous wording

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 its San Jac 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.

Current wording

The Company also operates shifting and fleeting facilities for dry cargo barges and tank barges on the Houston Ship Channel, in Freeport and Port Arthur, Texas, and Lake Charles, Louisiana, and its San Jac shipyard for building inland towboats and performing routine maintenance on marine vessels near the Houston Ship Channel. The Company also owns a two-thirds interest in Osprey Line, L.L.C., a transporter of project cargoes and cargo containers by barge on the United States inland waterway system.

Previous wording

For 2024, 59% of the Company’s revenues were generated by KMT. 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.

Current wording

For 2025, 58% of the Company’s revenues were generated by KMT. 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.

Previous wording

Overall inland tank barge utilization levels in 2024 were flat as compared to 2023, ranging from the low to mid-90% range during both the 2024 first and second quarters, and the 90% range during both the 2024 third and fourth quarters. During 2023, inland tank barge utilization levels ranged from the low to mid-90% range during the 2023 first quarter, the low 90% range during the 2023 second quarter, the high 80% range during the 2023 third quarter, and the low 90% range in the 2023 fourth quarter.

Current wording

Inland tank barge utilization levels in 2025 were flat as compared to 2024, ranging from the low to mid-90% range during both the 2025 first and second quarters, and mid-80% range during the 2025 third quarter, and the mid to high 80% range during the 2025 fourth quarter. Lighter feedstock mix for refinery and chemical customers and fewer barges undergoing maintenance across the industry impacted utilization in the 2025 second half. During 2024, inland tank barge utilization levels ranged from the low to mid-90% range during both the 2024 first and second quarters and the 90% range during both the 2024 third and fourth quarters. Coastal tank barge utilization levels during both 2025 and 2024 averaged in the mid to high 90% range.

Previous wording

Approximately 65% of the inland marine transportation revenues were under term contracts and 35% were under spot contracts in 2024. Approximately 60% of the inland marine transportation revenues were under term contracts and 40% were under spot contracts in 2023. Term contracts 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 61% of the inland revenues under term contracts during 2024 and 63% in 2023. During 2024 and 2023, approximately 99% and 85%, respectively, of coastal revenues were under term contracts and 1% and 15%, respectively, were under spot contracts. Coastal time charters represented approximately 98% and 90% of coastal revenues under term contracts during 2024 and 2023, respectively. Term contracts have contract terms of 12 months or longer, while spot contracts have contract terms of less than 12 months.

Current wording

Approximately 70% of the inland marine transportation revenues were under term contracts and 30% were under spot contracts in 2025. Approximately 65% of the inland marine transportation revenues were under term contracts and 35% were under spot contracts in 2024. Term contracts provide the operations with a reasonably predictable revenue stream. Inland time charters, which help insulate the Company from revenue fluctuations caused by weather and navigational delays and temporary market declines, represented 59% of the inland revenues under term contracts during 2025 and 61% in 2024. During 2025 and 2024, approximately 100% and 99%, respectively, of coastal revenues were under term contracts and none and 1%, respectively, were under spot contracts. Coastal time charters represented approximately 100% and 98% of coastal revenues under term contracts during 2025 and 2024, respectively. Term contracts have contract terms of 12 months or longer, while spot contracts have contract terms of less than 12 months.

Previous wording

Spot and term contract pricing in the coastal market are contingent on various factors including geographic location, vessel capacity, vessel type, and product serviced.

Current wording

Term contract pricing in the coastal market are contingent on various factors including geographic location, vessel capacity, vessel type, and product serviced.

Previous wording

Effective January 1, 2024, 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 9.5%, excluding fuel.

Current wording

Effective January 1, 2025, annual escalators for labor and the producer price index on a number of inland multi-year contracts resulted in rate increases on those contracts in the 3% to 5% range, excluding fuel.

Previous wording

The 2024 marine transportation operating margin was 19.0% compared to 13.9% for 2023.

Current wording

The 2025 marine transportation operating margin was 19.3% compared to 19.0% for 2024.

Previous wording

The Company, through KDS, provides after-market services 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, construction equipment and refrigeration trailers for use in a variety of industrial markets. The Company also manufactures and remanufactures specialized equipment, including pressure pumping units, electric power generation equipment, and specialized electrical distribution and control equipment for oilfield service, railroad and other industrial customers. The Company sells and manufactures various products used in oil and gas and industrial applications, including those used in hydraulic fracturing and refrigeration systems that, as compared to conventional offerings, reduce emissions. These products made up approximately 18% of KDS’s revenues in 2024.

Current wording

The Company, through KDS, provides equipment, after-market parts and services for power generation systems in applications that include behind the meter power systems and emergency backup systems, after-market and genuine replacement parts and services for engines, transmissions, reduction gears, electric motors, drives, and controls, specialized electrical distribution and controls systems, and related equipment used in power generation, marine, on-highway, oilfield services, and other industrial applications. The Company also rents equipment including generators, industrial compressors, high-capacity lift trucks, construction equipment and refrigeration trailers for use in a variety of industrial markets. The Company also manufactures and remanufactures specialized equipment, including pressure pumping units and electric fracturing systems, electric power generation equipment, and specialized electrical distribution and control equipment for data centers, oilfield service, railroad and other industrial customers. The Company sells and manufactures various products used in oil and gas and industrial applications, including those used in hydraulic fracturing and refrigeration systems that, as compared to conventional offerings, reduce emissions. These products made up approximately 20% of KDS’s revenues in 2025.

Previous wording

During 2024, KDS generated 41% of the Company’s revenues, of which 80% was generated from service and parts and 20% from manufacturing. The results of KDS 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.

Current wording

During 2025, KDS generated 42% of the Company’s revenues, of which 83% was generated from service and parts and 17% from manufacturing. The results of KDS are largely influenced by cycles of the power generation, marine, on-highway, oilfield service industry and oil and gas operator and producer markets, and other industrial markets.

Previous wording

Distribution and services revenues for 2024 decreased 1% compared to 2023 and operating income decreased 5% compared to 2023. In the commercial and industrial market, revenues decreased 1% in 2024 compared to 2023 primarily due to lower business levels in Thermo King and on-highway businesses due to the ongoing trucking recession, partially offset by higher business levels in marine repair. For both 2024 and 2023, the commercial and industrial market contributed 46% of the distribution and services revenues.

Current wording

Distribution and services revenues for 2025 increased 6% compared to 2024 and operating income increased 20% compared to 2024. In the commercial and industrial market, revenues increased 5% in 2025 compared to 2024 primarily due to higher business levels in marine repair. For both 2025 and 2024, the commercial and industrial market contributed 46% of the distribution and services revenues.

Previous wording

In the oil and gas market, revenues declined 28% compared to 2023 due to lower levels of conventional oilfield activity, partially offset by deliveries of electric fracturing equipment. For 2024 and 2023, the oil and gas market contributed 18% and 25%, respectively, of the distribution and services revenues.

Current wording

In the oil and gas market, revenues declined 32% compared to 2024 due to lower levels of conventional oilfield activity which resulted in decreased demand for new transmissions and parts, partially offset by deliveries of electric fracturing equipment. For 2025 and 2024, the oil and gas market contributed 11% and 18%, respectively, of the distribution and services revenues.

Previous wording

The distribution and services operating margin for 2024 was 8.0% compared to 8.4% for 2023.

Current wording

The distribution and services operating margin for 2025 was 9.2% compared to 8.0% for 2024.

Previous wording

Overall, the Company expects to deliver improved financial results in 2025. In KMT, barge utilization and customer demand remain stable and term rates continue to increase. In KDS, growth in the power generation market is expected to mostly offset softness in oil and gas markets, and the on-highway service and repair business due to the ongoing trucking recession. The Company remains mindful of the ever-changing economic landscape related to the possible impact of high interest rates and possible recessionary headwinds as it moves through 2025.

Current wording

Overall, the Company expects to deliver improved financial results in 2026. In KMT, barge utilization and customer demand remain stable. In KDS, growth in the power generation market is expected to offset softness in oil and gas markets, and the continuing trucking recession impacting the on-highway service and repair business. The Company remains mindful of the ever-changing economic landscape related to the possible impact of high interest rates, tariffs, and possible recessionary headwinds as it moves through 2026.

Previous wording

In the inland marine transportation market in 2025, the Company anticipates positive market dynamics due to limited new barge construction. The Company expects barge utilization rates to remain steady for the year with continued improvement in term contract pricing as renewals occur throughout the year. However, the Company continues to see inflationary pressures and there remains an acute mariner shortage in the industry which continues to drive up labor costs. These pressures, along with the increasing cost of equipment, should continue to put upward pressure on spot and term contract prices. In the coastal marine transportation market in 2025, market conditions remain very favorable with steady customer demand expected to keep barge utilization at high levels with improved rates as the availability of equipment is limited across the industry due to no further ATBs currently under construction and favorable economic conditions.

Current wording

In 2026, the inland marine transportation market is expected to experience positive market dynamics due to limited new barge construction. The Company expects barge utilization rates to remain steady for the year with continued improvement in pricing as the year progresses. The Company also continues to see inflationary pressures and there remains an acute mariner shortage in the industry which continues to drive up labor costs. These pressures, along with the increasing cost of equipment, should continue to put upward pressure on spot and term contract prices. The coastal marine transportation market is also expected to see very favorable market conditions in 2026. The coastal marine transportation market should experience steady customer demand keeping barge utilization at high levels with improving rates as the availability of equipment remains limited across the industry. There are no coastal barges currently under construction. The Company does expect more shipyard days in the coastal marine transportation market as compared to 2025.

Previous wording

The Company expects to yield mixed results in KDS in 2025 as near-term volatility from supply issues, customers deferring maintenance, and lower overall levels of activity in the oil and gas market are partially offset by increased orders in the power generation market. In commercial and industrial, the demand outlook in marine repair remains steady while on-highway service and repair remains soft in the current environment. In power generation, the Company anticipates continued strong growth in orders as data center demand and the need for backup power continues to be strong. In oil and gas, the Company expects revenues to be down as the shift away from conventional diesel hydraulic fracturing to electric hydraulic fracturing continues to take place. The Company anticipates extended lead times for certain OEM products to continue contributing to a volatile delivery schedule of new products throughout 2025.

Current wording

The Company expects stable growth in KDS in 2026 as near-term volatility from supply issues, customers deferring maintenance, and lower overall levels of activity in the oil and gas market are offset by increased orders in the power generation market. In commercial and industrial, the demand outlook in marine repair remains steady while on-highway service and repair remains soft but has shown some recent modest improvement. In power generation, the Company anticipates continued strong growth in orders as data center demand and the need for backup power continues to be strong. In oil and gas, the Company expects revenues to be down as the transition from conventional diesel hydraulic fracturing to electric hydraulic fracturing continues to take place. The Company anticipates extended lead times and supply delays for certain original equipment manufacturer products to continue throughout 2026.

Previous wording

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, improves the operating capacity of the vessel, or replaces significant components 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, improve the operating capability of the vessel, or replace significant components 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.

Current wording

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, improves the operating capacity of the vessel, or replaces significant components 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, improve the operating capability of the vessel, or replace significant components 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 vessels.

Previous wording

Overall inland tank barge utilization levels in 2024 were flat as compared to 2023, ranging from the low to mid-90% range during both the 2024 first and second quarters, and the 90% range during both the 2024 third and fourth quarters. During 2023, inland tank barge utilization levels ranged from the low to mid-90% range during the 2023 first quarter, the low 90% range during the 2023 second quarter, the high 80% range during the 2023 third quarter, and the low 90% range in the 2023 fourth quarter.

Current wording

Inland tank barge utilization levels in 2025 were flat as compared to 2024, ranging from the low to mid-90% range during both the 2025 first and second quarters, and mid-80% range during the 2025 third quarter, and the mid to high 80% range during the 2025 fourth quarter. Lighter feedstock mix for refinery and chemical customers and fewer barges undergoing maintenance across the industry impacted utilization in the 2025 third quarter. During 2024, inland tank barge utilization levels ranged from the low to mid-90% range during both the 2024 first and second quarters and the 90% range during both the 2024 third and fourth quarters. Coastal tank barge utilization levels during both 2025 and 2024 averaged in the mid to high 90% range.

Previous wording

The petrochemical market, the Company’s largest market, contributed 51% of marine transportation revenues for 2024, reflecting increased rates, volumes and utilization from Gulf Coast petrochemical plants as a result of improved economic conditions and a reduced supply of barges across the industry due to a heavier than normal maintenance cycle as compared to 2023.

Current wording

The petrochemical market, the Company’s largest market, contributed 48% of marine transportation revenues for 2025, reflecting steady rates, volumes and utilization from Gulf Coast petrochemical plants.

Previous wording

The black oil market, which contributed 25% of marine transportation revenues for 2024, reflecting improved demand as refinery utilization and production levels of refined petroleum products and fuel oils increased. During 2024, the Company transported crude oil and natural gas condensate produced from the Permian Basin and the Eagle Ford shale formation in Texas, both along the Gulf Intracoastal Waterway with inland vessels and in the Gulf of America 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.

Current wording

The black oil market, which contributed 26% of marine transportation revenues for 2025, reflecting stable demand as refinery utilization and production levels of refined petroleum products and fuel oils increased. During 2025, the Company transported crude oil and natural gas condensate produced from major U.S. shale basins along the Gulf Intracoastal Waterway with inland vessels and in the Gulf of America with coastal equipment. Additionally, the Company transported volumes of Utica natural gas condensate downriver from the Mid-Atlantic to the Gulf Coast.

Previous wording

The refined petroleum products market, which contributed 21% of marine transportation revenues for 2024, saw increased volumes in the inland market with improved refinery utilization and product levels.

Current wording

The refined petroleum products market, which contributed 23% of marine transportation revenues for 2025, reflected stable volumes in the inland market with steady refinery utilization and product levels.

Previous wording

The agricultural chemical market, which contributed 3% of marine transportation revenues for 2024, also experienced improved demand for transportation of both domestically produced and imported products.

Current wording

The agricultural chemical market, which contributed 3% of marine transportation revenues for 2025, reflected stable demand for transportation of both domestically produced and imported products.

Previous wording

Inland operations incurred 11,583 delay days in 2024, 7% more than the 10,863 delay days that occurred during 2023. 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 2024 and 2023 were impacted by hurricanes and tropical storms, poor operating conditions due to heavy wind and fog along the Gulf Coast, low and high water conditions on the Mississippi River System, and various lock closures, due in part to lock maintenance projects. The 2023 third quarter was also impacted by lock closures on the Illinois River.

Current wording

Inland operations incurred 11,410 delay days in 2025, 1% fewer than the 11,583 delay days that occurred during 2024. 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 reflected very favorable seasonal weather and improved navigational conditions in the 2025 third quarter, and poor operating conditions due to heavy wind and fog along the Gulf Coast and lock delays during the 2025 and 2024 first quarters.

Previous wording

Approximately 65% of the inland marine transportation revenues were under term contracts and 35% were under spot contracts in 2024. Approximately 60% of the inland marine transportation revenues were under term contracts and 40% were under spot contracts in 2023. Term contracts 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 61% of the inland revenues under term contracts during 2024 and 63% in 2023. During 2024 and 2023, approximately 99% and 85%, respectively, of coastal revenues were under term contracts and 1% and 15%, respectively, were under spot contracts. Coastal time charters represented approximately 98% and 90% of coastal revenues under term contracts during 2024 and 2023, respectively. Term contracts have contract terms of 12 months or longer, while spot contracts have contract terms of less than 12 months.

Current wording

Approximately 70% of the inland marine transportation revenues were under term contracts and 30% were under spot contracts in 2025. Approximately 65% of the inland marine transportation revenues were under term contracts and 35% were under spot contracts in 2024. Term contracts provide the operations with a reasonably predictable revenue stream. Inland time charters, which help insulate the Company from revenue fluctuations caused by weather and navigational delays and temporary market declines, represented 59% of the inland revenues under term contracts during 2025 and 61% in 2024. During 2025 and 2024, approximately 100% and 99%, respectively, of coastal revenues were under term contracts and none and 1%, respectively, were under spot contracts. Coastal time charters represented approximately 100% and 98% of coastal revenues under term contracts during 2025 and 2024, respectively. Term contracts have contract terms of 12 months or longer, while spot contracts have contract terms of less than 12 months.

Previous wording

Spot and term contract pricing in the coastal market are contingent on various factors including geographic location, vessel capacity, vessel type, and product serviced.

Current wording

Term contract pricing in the coastal market are contingent on various factors including geographic location, vessel capacity, vessel type, and product serviced.

Previous wording

Effective January 1, 2024, 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 9.5%, excluding fuel.

Current wording

Effective January 1, 2025, annual escalators for labor and the producer price index on a number of inland multi-year contracts resulted in rate increases on those contracts in the 3% to 5% range, excluding fuel.

Previous wording

Total costs and expenses for 2024 increased 4% compared to 2023. Costs of sales and operating expenses for 2024 increased 5% compared to 2023 primarily reflecting higher business activity levels and inflationary cost pressures which was partially offset by lower fuel costs.

Current wording

Total costs and expenses for 2025 increased 1% compared to 2024. Costs of sales and operating expenses for 2025 decreased 1% compared to 2024 primarily reflecting lower fuel costs which was partially offset by inflationary cost pressures including salary and wage increases that went into effect on July 1, 2025.

Previous wording

The inland marine transportation fleet operated an average of 285 towboats during 2024, of which an average of 70 were chartered, compared to 280 during 2023, of which an average of 64 were chartered. The increase was primarily due to higher business activity levels. 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.

Current wording

The inland marine transportation fleet operated an average of 279 towboats during 2025, of which an average of 69 were chartered, compared to 285 during 2024, of which an average of 70 were chartered. The decrease was primarily due to lower business activity levels in the second half of 2025. 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.

Previous wording

Inland operations consumed 46.8 million gallons of diesel fuel in 2024 compared to 48.1 million gallons consumed during 2023. The average price per gallon of diesel fuel consumed during 2024 was $2.66 per gallon compared to $3.08 per gallon for 2023. 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 120 day delay before contracts are adjusted. Spot contracts do not have escalators for fuel.

Current wording

Inland operations consumed 49.3 million gallons of diesel fuel in 2025 compared to 46.8 million gallons consumed during 2024. The average price per gallon of diesel fuel consumed during 2025 was $2.47 per gallon compared to $2.66 per gallon for 2024. 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 120 day delay before contracts are adjusted. Spot contracts do not have escalators for fuel.

Previous wording

Selling, general and administrative expenses for 2024 increased 3% compared to 2023. The increase was primarily due to continued inflationary cost pressures and annual compensation increases.

Current wording

Selling, general and administrative expenses for 2025 increased 5% compared to 2024 due to inflationary cost pressures, including higher medical costs, and salary and wage increases that went into effect on July 1, 2025.

Previous wording

Depreciation and amortization for 2024 increased 7% compared to 2023. The increase was primarily due to capital additions during 2024 and 2023.

Current wording

Depreciation and amortization for 2025 increased 8% compared to 2024. The increase was primarily due to capital additions and equipment acquisitions during 2025 and 2024.

Previous wording

KMT operating income for 2024 increased 52% compared to 2023. The operating margin was 19.0% for 2024 compared to 13.9% for 2023. The increase in operating income and operating margin were primarily due to higher term and spot contract pricing in the inland and coastal markets.

Current wording

KMT operating income for 2025 increased 3% compared to 2024. The operating margin was 19.3% for 2025 compared to 19.0% for 2024. The increase in operating income and operating margin were primarily due to higher term pricing in the coastal market and higher spot and term pricing in the inland market over the 2025 first half, partially offset by lower barge utilization and moderating prices in the inland market in the 2025 second half.

Previous wording

KDS revenues for 2024 decreased 1% compared to 2023. In the commercial and industrial market, revenues decreased 1% in 2024 compared to 2023 primarily due to lower business levels in Thermo King and on-highway businesses due to the ongoing trucking recession, partially offset by higher business levels in marine repair. For both 2024 and 2023, the commercial and industrial market contributed 46% of the distribution and services revenues.

Current wording

KDS revenues for 2025 increased 6% compared to 2024. In the commercial and industrial market, revenues increased 5% in 2025 compared to 2024 primarily due to higher business levels in marine repair. For both 2025 and 2024, the commercial and industrial market contributed 46% of the distribution and services revenues.

Previous wording

In the oil and gas market, revenues declined 28% compared to 2023 due to lower levels of conventional oilfield activity, partially offset by deliveries of electric fracturing equipment. For 2024 and 2023, the oil and gas market contributed 18% and 25%, respectively, of the distribution and services revenues.

Current wording

In the oil and gas market, revenues declined 32% compared to 2024 due to lower levels of conventional oilfield activity which resulted in decreased demand for new transmissions and parts, partially offset by deliveries of electric fracturing equipment. For 2025 and 2024, the oil and gas market contributed 11% and 18%, respectively, of the distribution and services revenues.