Highlights

2008 First Quarter

• Record revenues, earnings, earnings per share and EBITDA
• Continued favorable marine transportation fundamentals
• Weather delays were 15% above the 2007 first quarter
• Time charter contracts averaged 56% of term contract revenues, thereby reducing earnings volatility caused by weather and navigational delays
• Operated 260 towboats compared with 248 during the 2007 first quarter
• Continued to make progress in addressing vessel crewing shortages
• Contracts up 9% to 11% and spot market rates up 13% to 15% year over year and above contract rates
• Diesel engine services - strong demand in medium-speed market, with high-speed market, as expected, slower due to seasonal softness in Gulf Coast oil service market
  

2008 Second Quarter and Year Outlook

• 2008 second quarter earnings guidance of $.69 to $.74 per share and compares with $.56 for the 2007 second quarter
• Guidance based on:
  
  • Business levels for both marine transportation and diesel engine services anticipated to remain favorable
  • Continued high equipment utilization, upward trend in rates, increased efficiencies from operating additional,
  • fully-crewed towboats
  • More modest mid-single digit contract and spot market rate increases given current softness of U.S. economy
  • Lower GDP growth rates for 2008 compared with 2007
  • Significant increase in delay days due to high water conditions on the Mississippi River
  • Time charter contracts averaged approximately 56% of contract revenues:
    • Reduces earnings volatility caused by weather and navigational delays
    • Reduces typical earnings volatity between first and second quarters
      
• 2008 year earnings guidance increased to $2.74 to $2.89 per share, compared with $2.29 for 2007
  

Revenues (in millions) Earnings Per Share After Adjustments*   EBITDA**

* Net earnings and earnings per share after adjustments are non-GAAP financial measures used by Kirby that exclude non-recurring adjustments in order to present a measure of net earnings that facilitates a comparison of results from one period to results from another period on a more consistent basis, since the non-recurring items are materially different in nature and amount from one period to another. The adjustments generally represent items that are outside normal business operations and are therefore difficult to predict for future periods.

** EBITDA, which Kirby defines as net earnings before interest expense, taxes on income, depreciation and amortization, is used because of its wide acceptance as a measure of operating profitability before nonoperating expenses (interest and taxes) and noncash charges (depreciation and amortization), EBITDA is one of the perfromance measures used in Kirby's incentive bonus plan. EBITDA is also used by rating agencies in determining Kirby's credit rating and by analysts publishing research report on Kirby, as well as by investors and investment bankers generally in valuing companies.

Financial Highlights

Marine Transportation Revenues by Product Line

Approximate percent of marine transportation revenues.

12,000 miles of waterway linking America's heartland to the world.

Fleet

The U.S. inland waterway system is comprised mainly of the Mississippi River and its tributaries and the Gulf Intracoastal Waterway (see map above) and is one of the busiest, cost-efficient, productive and safest transportation systems in the world. The inland waterway system comprises 12,000 miles of navigable interconnected rivers, canals and intracoastal waterways serving the U.S. as water highways.