Kirby : 4Q 2022 Earnings Presentation

4Q 2022

Earnings Conference Call

January 31, 2023

Disclosures

Forward Looking Statements

Statements contained in this conference call with respect to the future are forward-looking statements. These statements reflect management's reasonable judgment with respect to future events. Forward-looking statements involve risks and uncertainties. Actual results could differ materially from those anticipated as a result of various factors, including cyclical or other downturns in demand, significant pricing competition, unanticipated additions to industry capacity, changes in the Jones Act or in U.S. maritime policy and practice, fuel costs, interest rates, weather conditions and timing, magnitude and number of acquisitions made by Kirby, and the impact of the COVID-19 pandemic and the related response of governments on global and regional market conditions. Forward-looking statements are based on currently available information and Kirby assumes no obligation to update any such statements. A list of additional risk factors can be found in Kirby's annual report on Form 10-K for the year ended December 31, 2021 and in Kirby's subsequent filings on Form 10-Q for the quarters ended March 31, 2022, June 30, 2022 and September 30, 2022.

Non-GAAP Financial Measures

This conference call may refer to certain non-GAAP or adjusted financial measures. Kirby uses certain non-GAAP financial measures to review performance including: Adjusted EBITDA; operating income (excluding one-time items); earnings before taxes on income (excluding one-time items); net earnings attributable to Kirby (excluding one-time items); and diluted earnings per share (excluding one-time items). Management believes that the exclusion of certain one-time items from these financial measures enables it and investors to assess and understand operating performance, especially when comparing those results with previous and subsequent periods or forecasting performance for future periods, primarily because management views the excluded items to be outside of the company's normal operating results. Kirby also uses free cash flow, which is defined as net cash provided by operating activities less capital expenditures, to assess and forecast cash flow and to provide additional disclosures on the Company's liquidity as a result of uncertainty surrounding the impact of the COVID-19 pandemic on global and regional market conditions. Free cash flow does not imply the amount of residual cash flow available for discretionary expenditures as it excludes mandatory debt service requirements and other non-discretionary expenditures. These non-GAAP financial measures are not calculations based on generally accepted accounting principles and should not be considered as an alternative to, but should only be considered in conjunction with Kirby's GAAP financial information. Reconciliations of the non-GAAP financial measures to the most directly comparable GAAP financial measures are included in our earnings press release, and are also available on our website at www.kirbycorp.comin the Investor Relations section under Financials.

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4Q 2022 Overview

Financial Summary

	$ millions except earnings (loss) per share		4Q 2022			4Q 2021	Variance	%					3Q 2022	Variance	%
	Revenues	$	730.2		$	591.3	$ 138.9	23%		$ 745.8	$ (15.6)	-2%
	Operating income (loss)		57.7			31.6	26.1	83%		58.9	(1.2)	-2%
	Net earnings (loss) attributable to Kirby		37.3			11.0	26.3	239%		39.1	(1.8)	-5%
	Earnings (loss) per share		0.62			0.18	0.44	244%		0.65	(0.03)	-5%
	Excluding one-time items:
	Operating income1		61.9			31.6	30.3	96%			58.9	3.0	5%
	Net earnings attributable to Kirby1,2		40.3			16.7	23.6	141%			39.1	1.2	3%
	Earnings per share1,2		0.67			0.27	0.40	148%		0.65	0.02	3%

• Results reflected steady market fundamentals in marine transportation and distribution and services
• Marine transportation margins impacted by unfavorable weather conditions
• • 147% sequential increase in delays days
• Some seasonal slowness and supply chain constraints delayed sales in distribution and services
• Cost inflation remained a headwind to margins for both marine transportation and distribution and services

Note: For more information, see the Reconciliation of GAAP to Non-GAAP Financial Measures Excluding One-Time Items on Kirby's website at www.kirbycorp.com in the Investor Relations section under Financials.

1. Fourth quarter 2022 operating income, net earnings attributable to Kirby and earnings per share exclude one-time items related to severance expenses, early retirement, and costs associated with strategic review, or $0.05 per share
2. Fourth quarter 2021 net earnings attributable to Kirby, and earnings per share exclude fourth quarter one-time change in Louisiana tax law of $5.7 million, or $0.09 per share

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FY 2022 Overview

Financial Summary

	($ millions except earnings per share)	2022		2021	Variance	%
	Revenues	$ 2,784.7		$ 2,246.7	$ 538.0	24%
	Operating income (loss)	192.9		(258.1)	451.0	175%
	Net earnings (loss) attributable to Kirby	122.3		(247.0)	369.3	150%
	Earnings (loss) per share	2.03		(4.11)	6.14	149%
	Excluding one-time items:
	Operating income (loss)1,2	198.6			82.6	116.0	140%
	Net earnings attributable to Kirby1,2	126.6			33.7	92.9	276%
	Earnings per share1,2	2.10		0.56	1.54	275%

Note: For more information, see the Reconciliation of GAAP to Non-GAAP Financial Measures Excluding One-Time Items on Kirby's website at www.kirbycorp.com in the Investor Relations section under Financials.

1. 2022 operating income, net earnings attributable to Kirby, and earnings per share exclude $5.7 million before-tax, $4.3 million after-tax, or $0.07 per share, of one-time charges associated with severance, early retirement, and costs associated with strategic review
2. 2021 operating income, net earnings attributable to Kirby, and earnings per share exclude the following one-time items:
3. • Impairments of long-lived assets and goodwill related to coastal marine transportation totaling $340.7 million before-tax, $275.0 million after-tax, or $4.58 per share; and
   • Deferred tax provision related to a change in Louisiana state tax law totaling $5.7 million or $0.09 per share

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Marine Transportation - 4Q Overview

Market fundamentals continue to improve but inflation, including rising fuel costs, impacted margins

Inland

• Strong market conditions
• • Spot market rates increased sequentially and year-over-year
  • Term contracts renewed higher 10% to 15% year-over-year
• Tight market conditions with barge utilization in the 90% range
• 4Q operating margins improved to low teens

Coastal

• Market conditions modestly improved
• Barge utilization in the low to mid-90% range
• Improved coal shipments in the dry cargo business
• 4Q operating margins in the low single digits

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