8-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

Date of report (Date of earliest event reported): May 19, 2005

Kirby Corporation

(Exact name of registrant as specified in its charter)

Nevada	1-7615	74-1884980
(State or other jurisdiction of incorporation or organization)	(Commission File Number)	(I.R.S. Employer Identification No.)
55 Waugh Drive, Suite 1000		77007
Houston, Texas		(Zip Code)
(Address of principal executive offices)
	Registrant’s telephone number, including area code:
	(713) 435-1000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 7.01. Regulation FD Disclosure.

On May 19, 2005, Kirby Corporation’s senior management will make a presentation to investors and analysts from 2:00 p.m. (Eastern time) until approximately 5:20 p.m. (Eastern time) in New York City. A live webcast of the presentation will be available to the public and replays will be available afterward. The webcast can be accessed by visiting Kirby’s Web site at http://www.kirbycorp.com/ or by following the link below and selecting the streaming audio option:

http://invite.mshow.com/findshow.aspx?usertype=0&cobrand=100&shownumber=235506

Reference: Kirby Corporation Analyst Day, show number 235506

A copy of the slide presentation that will be used by Kirby at the event, substantially in the form intended to be used, is included as Exhibit 99.1 to this report and is also posted on Kirby’s Web site at http://kirbycorp.com/ in the Investor Relations section under Investor and Analyst Meeting, May 19, 2005.

The program will also include presentations by the Waterways Council, Inc. on the U.S. inland waterway system infrastructure, by Chemical Market Associates, Inc. (CMAI) on the outlook for the petrochemical industry and by Purvin & Gertz, Inc. on the refined products market. As a convenience to interested persons, and without any express or implied endorsement by Kirby, copies of prepared materials for those three presentations are available on Kirby’s Web site in the Investor Relations section under Investor and Analyst Meeting, May 19, 2005. Waterways Council, Inc., CMAI and Purvin & Gertz, Inc. is each solely responsible for its own presentation. The information, analysis and opinions contained in those three presentations are those of the presenting organizations alone. Kirby has no responsibility for the content of any of those presentations.

Item 9.01. Financial Statements and Exhibits.

(c) Exhibits

99.1 Kirby Corporation slide presentation dated May 19, 2005

SIGNATURES

Pursuant to the requirements 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.

KIRBY CORPORATION
(Registrant)
By:	/s/   G. STEPHEN HOLCOMB
	G. Stephen Holcomb
	Vice President, Investor Relations

Dated: May 19, 2005

EXHIBIT INDEX

Exhibit  99.1 Kirby Corporation slide presentation dated May 19, 2005

EX-99.1

2:00 – 2:05	Welcome and Introductions
2:05 – 2:30	U.S. Inland Waterways
2:30 – 3:00	Kirby Overview
3:00 – 3:15	Kirby Inland Marine · Kirby and Industry Fleet Profile
3:15 – 3:30	Break 15 minutes
3:30 – 3:50	Kirby Engine Systems Overview
3:50 – 4:35	Outlook for the Petrochemical Industry · Chemical Market Associates, Inc.
4:35 – 5:20	Refined Products Supply & Demand Drivers · Purvin & Gertz, Inc.
5:20 – 5:25	Closing Remarks

Agenda

Kirby Analyst/Investor Meeting

2:00 – 2:05	Welcome and Introductions
2:05 – 2:30	U.S. Inland Waterways
2:30 – 3:00	Kirby Overview
3:00 – 3:15	Kirby Inland Marine · Kirby and Industry Fleet Profile
3:15 – 3:30	Break 15 minutes
3:30 – 3:50	Kirby Engine Systems Overview
3:50 – 4:35	Outlook for the Petrochemical Industry · Chemical Market Associates, Inc.
4:35 – 5:20	Refined Products Supply & Demand Drivers · Purvin & Gertz, Inc.
5:20 – 5:25	Closing Remarks

Agenda

Kirby Analyst/Investor Meeting

The State of the Waterways

Kirby Corporation Analysts’ Briefing

Berdon Lawrence, Chairman

Kirby Corporation

John Doyle, Vice President

Waterways Council, Inc. &

Special Counsel, Jones Walker LLP

The waterways are an
American success story:

•   They helped make America great

•   They create and maintain good
  agricultural and manufacturing
  jobs

•   But, our leaders in Washington
  began to take them for granted

•   So, industry and agriculture
  organized to defend and improve
  the waterways

•   We have been successful so far

•   The outlook is positive

Canals

Dams

Locks

The System

Rivers

-Nearly 12,000 Miles 9 ft & Over

-192 Lock Sites / 238 Chambers

-About 2/3rds Cost of Rail and

1/10 Cost of Truck

How far one gallon of fuel

moves one ton of freight, average by mode…

Truck:  70 miles

Rail:  420 miles

Barge:  530 miles

0

100

200

300

400

500

600

Miles

Barge transportation enjoys similar efficiencies in air
emissions per ton mile.

We Conserve Fuel & Reduce
Air Emissions

We offer a solution to Congestion:

The waterways
serve key future
transportation corridors

The waterways serve many

traffic growth corridors.

America’s Waterways Advantage

•   American farmers and industries compete in
  a tough global marketplace

–  If you get the goods to the customer cheaper,
 you get the sale

–  Efficient, low cost waterways transportation
 reduces total costs and allows us to compete

•   The Result:  American exports win and vital,
  high paying jobs stay here!

Over $10
Billion

$2 - 10
Billion

$1 - 2
Billion

$100 Million to

$1 Billion

Lock Construction

or Rehabilitation

Under  $100

Million

Based on data developed by TVA and USACE.

Value of Inland and Intracoastal
Waterborne Cargo

 by State of Origin

•   Over $112 billion
  in cargo

•  Shipped from 31
states

•   At average
  savings of      
  $11 / ton over
  competing modes

Waterways Role in Nation’s
Economic Prosperity

•   Grain Exports

– 90 million tons annually

– 70% of soybean and
62% of corn exports
move by barge

Waterways Role in Nation’s
Economic Prosperity

•   Coal for power plants

–  227 million tons annually – inland, Lakes, coastal

–  20 % of utility coal supplied by waterway

Waterways Role in Nation’s
Economic Prosperity

•   Petrochemicals &
  Petroleum Products

–  350 million tons
 annually between
 domestic points

We are having success…
      …because we have a good story to tell

•   Keeping our industries and farmers
  competitive in a very tough global
  marketplace preserves U.S. jobs

•   Reduces congestion on our highways

This is an easy story to understand, but
somebody has to tell it to the Washington
lawmakers.

Traditionally, the industry did not take a proactive

role in telling this story.  Over time, this resulted in:

The 90’s

•   Declining support in the Administration and
  Congress

•   Corps spending on waterways diverted elsewhere

•   Trust fund balance starts to rise

•  “Environmentalists” mount attack on the Corps

•   Media & editorial campaigns against the Corps
  and water resources development

Waterways Work! was formed

in 2001 to counter negative

publicity about the industry

In 2003, Waterways Work

merged with DINAMO, the

Association for the Ohio

Valley, and formed the

Waterways Council, Inc.

The Waterways Council, Inc.: 

• Professional staff based in Washington, DC

• Media relations team

• Annual budget now over $1 million

• Active member involvement

• Dedicated lobbying team – Jones Walker/Livingston  Group

The waterway community response:

Who are WCI
Members?

•   All waterway business
  interests:

–  Carriers

–  Shippers

–  Waterways Service
 Providers

–  Port Authorities &
 Governmental Entities

–  Regional Associations

•   Geographically Diverse

•   All major commodity
  groups:

–  Oil, chemical and
 petrochemical

–  Grain

–  Coal

–  Building Materials

–  Steel, Aluminum and Ore

–  Containers

The Objectives:     

•   Get the President to propose
  adequate budgets

•   Get Congress to pass laws that
  authorize projects and
  appropriate the money needed
  each year to build and maintain them

•   Ensure the Corps of Engineers
  actually spends the money as
  intended by Congress

New Construction

Major Rehabilitation

Olmsted

Inner

Harbor

Marmet

McAlpine

Kentucky

L&D 11 Rehab

L&D 19 Rehab

L&D 24 Rehab

Lower Mon 2-4

Myers

Chickamauga

Active new lock
construction and major
rehabilitation program
underway in FY ‘05:

•  8 new or replacement

   locks (receiving IWTF funds)

•  3 major rehabs

•  $332 million in funding

New Construction and Modernization:
Major Navigation Projects Underway

 Based on FY 2005 Appropriations

Year	Estimated Outlays	Tax  Revenues	Interest Earnings	Year-End Balances
	($Millions)
1990	117.3	62.8	26.2	292.8
1991	148.6	60.5	21.2	225.9
1992	122.7	69.9	13.7	186.7
1993	74.5	78.6	7.5	198.3
1994	75.7	88.4	9.3	220.2
1995	94.8	103.4	13.3	242.1
1996	85.5	108.4	15.6	280.6
1997	89.5	96.4	17.0	304.6
1998	76.9	91.1	18.3	337.1
1999	88.2	104.4	16.0	369.2
2000	102.4	99.6	20.0	387.8
2001	120.3	102.6	20.9	390.9
2002	104.5	95.3	12.4	394.1
2003	101.6	89.5	9.5	391.6
2004	117.3	90.8	6.9	372.0
*2005	146.0	92.0	7.0	325.0

Inland Waterways Trust Fund

Trust Fund Balances

Money from 20 cent per gallon fuel tax.  This is matched with an

equal sum from the Treasury.  Actual spending is double this amount.

50

70

90

110

130

150

170

190

210

96

97

98

99

OO

O1

O2

O3

O4

O5

O6

Fiscal Year

$184 Mil.

in Bush

Budget.

Appropriations

bill pending.

Waterways Work /

Waterways Council

Formed

Trust Fund Spending:
New Construction and Major Rehab

Millions of dollars

from trust fund.

Matched with

general revenues.

Recent Trust Fund Spending

	FY 2002 Enacted	FY 2003 Enacted	FY 2004 Enacted	FY 2005 Enacted	FY 2006 Request	% Difference (05 vs. 02)	% Difference (06 vs. 02)
Construction General	1,712	1,745	1,731	1,782	1,637	4.1	(-4.4)
Inland Waterways Trust Fund	189	253	270	332	368	75.7	94.7
Corps Civil Works Total	4,650	4,699	4,563	4,668	4,513	0.4	(-2.9)

Inland Waterways Trust Fund
Appropriations Comparison

($ in millions)

Goals for Fiscal Year 2006
Appropriations:

•   At least $300 million ($150 million from the
  Inland Waterways Trust Fund) for Building
  Priority Projects

•   An additional $100 million above the
  President’s budget for inland navigation
  Operations and Maintenance priority needs

0

100

200

300

400

500

600

1977

1980

1983

1986

1989

1992

1995

1998

2001

Current $ and 1996 Constant $,
Fuel-Taxed Waterways Only

2004

Real O&M funding remains flat even
as project portfolio grows and
ages…

Current $

Constant
$

Operations & Maintenance (O&M)
funding is our next major challenge

The O&M Challenge

•   Intensified Focus in 2005

•   System-Wide Examination

•   Joint Industry/Corps Initiative

•   Maintain and Improve System Reliability

•   Secure Adequate Resources and Invest to
  Maximize Results

–  Reduce Risk and Increase Reliability

Industry/Corps O&M Workshops in 2005

•   Conducted

–  January     Cincinnati, OH        Ohio River System

–  January     St. Louis, MO          Upper Miss./Illinois

–  February    Tampa, FL             Integration

–  April          New Orleans, LA     Gulf Intracoastal

•   Being Planned

–  TBD          TBD                     Lower Miss. & Tribs.

–  TBD          TBD                     Columbia/Snake

Industry/Corps O&M Workshops

•   Identify most pressing problems from
  perspective of Corps and industry

•   Allocate resources to address most pressing
  needs

•   We are committed to both short term and
  long term solutions to navigational issues

Also Where We Are Going…

•   Passage of Water Resources Development
  Act (WRDA)

–  Authorize Lock Modernization on the Upper
 Mississippi and Illinois Rivers

–  Reasonable, Non-Damaging “Corps Reform”
 Provisions

Kirby is a leader in efforts to

maintain and improve our

waterways infrastructure.

•   Kirby supports national efforts:

–  Berdon Lawrence, Chair, Waterways
 Works/Waterways Council 2001- March, 2005

–  Steve Valerius, Incoming Chair, American
 Waterways Operators

–  Joe Pyne, Chair, National Waterways
 Foundation

Kirby is a leader in efforts to

maintain and improve our

waterways infrastructure.

•   Kirby also supports regional efforts.  Examples:

–  *Gulf Intracoastal Canal Association (GICA)

–  Midwest Area River Coalition (MARC 2000)

–  *Louisiana Association of Waterways Operators and
 Shipyards (LAWS)

–  *Texas Waterway Operators Association (TWOA)

–  *Warrior Tombigbee Waterway Association

*Kirby employee is officer or director

Things are getting better

…yet we still have much work to do.

Some of the images in this presentation are courtesy of the

U.S. Army Corps of Engineers

2:00 – 2:05	Welcome and Introductions
2:05 – 2:30	U.S. Inland Waterways
2:30 – 3:00	Kirby Overview
3:00 – 3:15	Kirby Inland Marine · Kirby and Industry Fleet Profile
3:15 – 3:30	Break 15 minutes
3:30 – 3:50	Kirby Engine Systems Overview
3:50 – 4:35	Outlook for the Petrochemical Industry · Chemical Market Associates, Inc.
4:35 – 5:20	Refined Products Supply & Demand Drivers · Purvin & Gertz, Inc.
5:20 – 5:25	Closing Remarks

Agenda

Kirby Analyst/Investor Meeting

Kirby Corporation

Putting America’s Waterways to Work

NYSE:  KEX

May 2005

Statements contained in this presentation with respect to the future are
forward-looking statements. These statements reflect management’s
reasonable judgement 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 the timing, magnitude and the number of acquisitions made by Kirby. A list of additional risk factors can be found in Kirby’s annual report on Form 10-K for the year ended December 31, 2004, filed with the Securities and Exchange Commission. 

Kirby reports its financial results in accordance with generally accepted
financial principles (GAAP). However, Kirby believes that certain
Non-GAAP financial measures are useful in managing Kirby’s businesses and evaluating Kirby’s performance. This presentation contains two Non-GAAP financial measures, adjusted net earnings and EBITDA. Please see the Appendix for a reconciliation of GAAP to Non-GAAP financial measures.

Kirby Forward Looking Statement

Marine Transportation

87% of 2004 Revenue - $588.8 million

Largest U.S. Inland Tank Barge Operator

Diesel Engine Services

13% of 2004 Revenue - $86.5 million

Largest Domestic EMD Diesel Services Company

Kirby... Business Operations

Kirby Facts

•   Largest inland tank barge operator

•   Operates 878 barges and 239 towing vessels

•   Sustainable competitive advantages:

–  Lowest cost due to economies of scale

–  Best positioned for growth opportunities

–  “One Stop Shop” for customers

•   70% of Kirby’s business is under contract,
  30% spot market

•   Successful integration of 23 acquisitions

17% growth
rate from
1988-2004

Revenue... Business Operations

1994-2001 adjusted to exclude goodwill amortization expense

2002 adjusted to exclude impairment charges of $12.5 million, net of taxes, or $.51 per share

See Appendix for reconciliation of GAAP to Non-GAAP earnings per share

12.4% growth
rate from
1994 - 2004

Earnings Per Share From Continuing Operations Before Adjustments

Guidance

Earnings Per Share…

•   Record 1st quarter 2005 earnings of $.52, 44%
  increase over 1st quarter 2004 earnings of $.36

•   Raised 2005 annual forecast to $2.45 - $2.55,
  24% to 29% above 2004

•   1st quarter 2005 spot and contract rates
  increased 4% to 5%

•   2004 chemical volumes up 4% to 5%; 2005
  chemical volumes expected to improve but at a
  slower rate

•   Diesel engine business during 1st quarter 2005
  increased prices on both parts and labor

Recent Demands and Pricing Trends

•   70% Contract, 30% Spot

–  Reduces volatility and improves predictability

–  Allows Kirby to service peak demand from contract
 customers

–  Long-term approach to business

•   Ideally would want higher spot exposure when
  spot rates were higher than contract rates

–  Short-term approach to business

–  More risk

–  Difficult to achieve

Contract to Spot Market Mix

• Why has Kirby not benefited more from the
problems that rail and trucks are having with their
infrastructure?

Issues

60,000 bbl. two-barge tow is equivalent to:

Kirby’s fleet capacity of 16.4 million bbls. equates
to 82,000 trucks, or 21,900 rail cars

Rail Cars

80

Trucks

300

Barges Compete SuccessfullyWith Rails and Trucks

St. Paul

Sioux City

Chicago

Pittsburgh

Charleston

St. Marks

Tulsa

Brownsville

Corpus Christi

Houston

New Orleans

St. Louis

Cincinnati

Mobile

Kirby is one of the few operators offering distribution

throughout the
Mississippi River System and Gulf

Intracoastal
Waterway 

12,000 miles of navigable waterways
linking America’s heartland to the world

Texas and Louisiana account for 80% of the total U.S. production of chemicals and petrochemicals

Putting America’s Waterways to Work
Inland Waterway System

One gallon of fuel in a barge can move one ton of freight 522 miles, compared
to 403 miles by rail and only 80 miles for a truck.

Barge

Rail

Truck

Barges…
Efficient

While moving one ton of freight 1,000 miles:

•   Smog is a major problem in most major cities

•   Oxides of nitrogen are the chemicals that produce smog

Trains produce 3.5 times as much oxides of
nitrogen as barges

Trucks produce 19 times as much oxides of
nitrogen as barges

Barges…
Environmentally Friendly

•   Why has Kirby not benefited more from the
  problems that rail and trucks are having with their
  infrastructure?

•   What has been the cost of security measures
  required by the Homeland Security Act?

•  What are the prospects for an acquisition this year?

Issues

Shipper Owned Independent	Tank Barges Operated	Dry Cargo Barges Operated
Kirby Corporation	878	-
American Commercial Lines LLC	379	2,861
Marathon Ashland Petroleum	167	-
Ingram Barge Company	165	3,468
Canal Barge Company, Inc.	150	226
Florida Marine	103	-
American River Transportation Co	84	1,892
Blessey Enterprises	83	-
Higman Barge Lines, Inc.	77	-
Cenac Towing Company, Inc.	69	-
Magnolia Marine Transport Co	60	-
PPG Industries, Inc.	59	-
Martin Midstream Partners	55	-
Southern Towing Company	53	-
Settoon Towing, LLC	49	-
LeBeouf Brothers Towing Co	43	-
John W. Stone Oil	31	-
Dupont	30	-
Olin Corporation	26	-
Buffalo Marine Service, Inc.	22	-
River City Towing Services	19	-
Rhodia, Inc.	19	-
Lyondell Chemical Company	17	-

Shipper Owned Independent	Tank Barges Operated	Dry Cargo Barges Operated
Dynegy Midstream Services	16	-
Waxler Towing Company, Inc.	15	-
Highland Towing	15	-
ConocoPhillips Company	15	-
Plaquemine Towing Corp.	13	-
Houston Marine Services, Inc.	13	-
Devall Towing	12	-
Chem Carriers, Inc.	11	-
Westlake/GA&O Corporation	10	-
Merichem Company	8	-
Grifco	8	-
Apex Towing	7	-
Golding Barge Lines, Inc.	6	-
Republic of Texas	6	-
American Milling	5	17
Barge Management, Inc.	5	-
Mon River Towing, Inc.	4	142
Reilly Industries	4	-
Memphis Barge Lines	2	-
Cytec Industries	2	-
Jantran, Inc.	1	3
Other dry cargo carriers	-	9, 670
TOTAL	2,816	18,279

Sparks Companies, March 2005

Kirby Outpaces the Competition

Tank Barge Owners By Number of Tank Barges

•   Why has Kirby not benefited more from the
  problems that rail and trucks are having with their
  infrastructure?

•   What has been the cost of security measures
  required by the Homeland Security Act?

•   What are the prospects for an acquisition this year?

•   How is Osprey doing?

Issues

Osprey

•   Container on barge operation

–  Developing a new market

–  Challenge is to divert traffic from other modes and routes

–  Shorebased infrastructure more important than actual
 movement

•   Inland service shows great potential

–  Developing infrastructure

–  Building volume

–  Testing pricing

•   Coastal service using small ship struggling

–  Cost of vessel

–  Volume

•   Significant long term potential but short term
  development will be slow and uneven

–  5 to 10 year play

Observations About Market

•   Bear Sterns Conference

–  Disconnect between Wall Street’s perception and what
 transportation companies are seeing

•   Kirby’s current business conditions

–  Saw no February/March soft patch

–  Remain very busy

–  Customers are not telling us they are worried about
 their volumes

•   Best fundamentals Kirby has seen in 25 years

Financial Highlights

For Three Months Ended March 31

12.7%

15.2%

Operating Margins

11.2% growth
rate from
1994 - 2004

See Appendix for reconciliation of GAAP net earnings to Non-GAAP EBITDA

EBITDA Per Share Growth

* Excluding acquisitions

Cash Flows

31.1%

Debt / Capitalization

Balance Sheet

•   Investment grade public debt

–  Standard & Poor’s – BBB

–  Moody’s – Baa3

•   10-year unsecured Private Placement due 2013

–  $200 million outstanding

–  Floating rate of LIBOR +1.2%

–  Callable at par after one year without penalty

–  No required principal payments until maturity

•   $150 Million Revolving Credit Facility – December
  2003

–  Maturity extended three years to December 2007

–  Accordion feature added to allow maximum amount to
 increase to $225 million without amendment

Financial Strength

•   Approximately $200 million of outstanding debt

–  Floating rate private placement maturing 2013

–  $150 million bank revolving credit maturing   December
 2007 (expandable to $225 million)

•   $150 million hedged against interest rate
  movements

–  $50 million hedged until May 2009

–  $100 million hedged until February 2013

•   Total cost of debt in Q1 2005 averaged 6.0%

Interest Rate Risk

•   Completed first annual assessment of internal controls
  over financial reporting

–  No material weaknesses

–  No significant deficiencies

–  Clean opinion from KPMG

•   Total cost for 2004 compliance - $1 million plus

•   2005 Compliance

–  Minimal effort to update controls

–  Testing of controls

•  PCAOB and SEC rule changes expected to reduce projected
 time and cost

Section 404

Sarbanes-Oxley Act of 2002

•   Covers only vessel employees

•   Kirby’s policy is to fund 100% of Accumulated Benefit
  Obligation (ABO)

–  Plan assets: $76.4 million at 12/31/04

–  ABO: $75.6 million at 12/31/04

•   Pension expense

–  2003: $4.0 million

–  2004: $5.2 million

–  2005 Projected: $5.2 million

•   Contribution

–  2003: $5.6 million

–  2004: $4.6 million

–  2005 Projected: $4 - $8 million

Defined Benefit Pension Plan

2:00 – 2:05	Welcome and Introductions
2:05 – 2:30	U.S. Inland Waterways
2:30 – 3:00	Kirby Overview
3:00 – 3:15	Kirby Inland Marine · Kirby and Industry Fleet Profile
3:15 – 3:30	Break 15 minutes
3:30 – 3:50	Kirby Engine Systems Overview
3:50 – 4:35	Outlook for the Petrochemical Industry · Chemical Market Associates, Inc.
4:35 – 5:20	Refined Products Supply & Demand Drivers · Purvin & Gertz, Inc.
5:20 – 5:25	Closing Remarks

Agenda

Kirby Analyst/Investor Meeting

Kirby Inland Marine

May 2005

•   Industry Fleet Profile

•   Logistics Management

•   Marine Workforce

Focus

Industry Fleet Profile

Refined Products

10%

Black Oil

20%

Agricultural Chemicals

5%

Petrochemicals

65%

Market Segments

878 Active Tank Barges

Petrochemical
Refined
Products

High Capacity
pumps –
Specialty coated
tanks

694

105

63

13

3

Pressure

Pressurized
tanks

Black Oil

Self-contained
heating systems

Anhydrous
Ammonia

Refrigeration
tanks

Specialty

Stainless steel
tanks

High Tech and Diverse Fleet

Shipper Owned Independent	Tank Barges Operated	Dry Cargo Barges Operated
Kirby Corporation	878	-
American Commercial Lines LLC	379	2,861
Marathon Ashland Petroleum	167	-
Ingram Barge Company	165	3,468
Canal Barge Company, Inc.	150	226
Florida Marine	103	-
American River Transportation Co	84	1,892
Blessey Enterprises	83	-
Higman Barge Lines, Inc.	77	-
Cenac Towing Company, Inc.	69	-
Magnolia Marine Transport Co	60	-
PPG Industries, Inc.	59	-
Martin Midstream Partners	55	-
Southern Towing Company	53	-
Settoon Towing, LLC	49	-
LeBeouf Brothers Towing Co	43	-
John W. Stone Oil	31	-
Dupont	30	-
Olin Corporation	26	-
Buffalo Marine Service, Inc.	22	-
River City Towing Services	19	-
Rhodia, Inc.	19	-
Lyondell Chemical Company	17	-

Shipper Owned Independent	Tank Barges Operated	Dry Cargo Barges Operated
Dynegy Midstream Services	16	-
Waxler Towing Company, Inc.	15	-
Highland Towing	15	-
ConocoPhillips Company	15	-
Plaquemine Towing Corp.	13	-
Houston Marine Services, Inc.	13	-
Devall Towing	12	-
Chem Carriers, Inc.	11	-
Westlake/GA&O Corporation	10	-
Merichem Company	8	-
Grifco	8	-
Apex Towing	7	-
Golding Barge Lines, Inc.	6	-
Republic of Texas	6	-
American Milling	5	17
Barge Management, Inc.	5	-
Mon River Towing, Inc.	4	142
Reilly Industries	4	-
Memphis Barge Lines	2	-
Cytec Industries	2	-
Jantran, Inc.	1	3
Other dry cargo carriers	-	9, 670
TOTAL	2,816	18,279

Tank Barge Owners By Number of Tank Barges

Sparks Companies, March 2005

6

Fleet Size and Diversity

Total Tank Barges

2,816

Inland Tank Barge Industry

1,205	Double Skin 30K barges
1,292	Double Skin 10K barges
124	Double Skin < 10K barges
195	Single Skin barges
2,816	Total

Industry Fleet Hull Profile

Source: Sparks Companies, March 2005

Inland Tank Barge Fleet

2005

2006

113

29

Total Industry

New Construction on Order

31   Clean

   8   Black Oil

39   Total

   7   Clean

   8   Black Oil

15   Total

2005

2006

Kirby New Construction Plan

New Construction 23 39 15 6 9 11 18

Number of Barges

Barrel Capacity (mm)

Kirby Fleet Status

10,000 bbl – Clean	$1.0M
30,000 bbl – Clean	$2.1M
30,000 bbl – Heated Black Oil	$2.7M

New Construction Prices

Construction labor	38%
Steel, steel products	37%
Components	17%
Engineering	8%
	100%

New Construction Cost
Components

Logistics Management System

Logistics Management System

State-of-the-Art Communication and Positioning

Kirby Leads Industry

•   All equipment locations instantly available to customer

–  Current position

–  ETA to customer’s dock

–  Information available from booking to final invoice

Logistics Management

Equipment Positioning

Equipment Positioning

Kirby Leads Industry

•   All equipment locations instantly available to customers

–  Current position

–  ETA to customer’s dock

–  Information available from booking to final invoice

Logistics Management

•   Advanced logistics system enables higher equipment utilization
  and increased efficiency

•   Kirby’s software automatically selects least cost
  communications route

•   Communication system allows Kirby to effortlessly comply with
  new security regulations

Marine Workforce

•   Focus on Safety

•   Recruit

•   Train to be the best

•   Retain skilled personnel

•   Offer excellent pay and benefits

•   Provide advancement opportunity

•   Foster community environment

Recruit, Train and Retain

Captains / Pilots

Tankermen

Deckhands / Tankerman Trainees

Engineers

1,295 Marine Employees

468

424

307

96

Vessel Personnel Profile

Average Years of Service

Captains / Pilots

Tankermen

Engineers

12

5

13

Vessel Personnel Profile

•   Recruit

–  Hire the right people

–  Provide opportunity in rural areas with weak
 job markets

–  Comprehensive screening

•   Training and Development

–  Only company-owned and operated Training
 Center in industry

–  U.S. Coast Guard-approved programs

–  Provide safety and job skill training

–  Steersmen Training Program ensures lower
 turnover

Recruit, Train and Retain

•   Retain skilled personnel

–  Retain 30% we hire licensed from the outside

–  Retain 90% of the personnel we train in our program
 from deckhand to pilot

Recruit, Train and Retain

Deckhand

Tankerman

Steersman

Pilot

Relief Captain

Captain

Starting salary

$29,000

As soon as 6 mos.

$31,200 to $44,300

In 2-3 years

$46,900

In 3-5 years

$71,900

In 5-10 years

$76,500

In 10 years

$82,000* Up to
$100,000 plus
bonus

Kirby Offers Excellent Benefits

Highly competitive wages	401(k)
Insurance	Disability coverage
Pension plan	Annual incentive bonus
Free training	Longevity pay*
Paid salary while training	Holiday pay*

Provide Advancement
Opportunity

2:00 – 2:05	Welcome and Introductions
2:05 – 2:30	U.S. Inland Waterways
2:30 – 3:00	Kirby Overview
3:00 – 3:15	Kirby Inland Marine · Kirby and Industry Fleet Profile
3:15 – 3:30	Break 15 minutes
3:30 – 3:50	Kirby Engine Systems Overview
3:50 – 4:35	Outlook for the Petrochemical Industry · Chemical Market Associates, Inc.
4:35 – 5:20	Refined Products Supply & Demand Drivers · Purvin & Gertz, Inc.
5:20 – 5:25	Closing Remarks

Agenda

Kirby Analyst/Investor Meeting

The Diesel Engine
Service Market

	Engine Speed	Horsepower Range	Applications	Manufacturers
Slow Speed	Less than 400 RPM	7,000 – 108,000 hp	Large diesel-powered ocean going tankers, cruise ships, container ships and cargo carriers	Man B&W, Sulzer, Wartsila
Medium Speed	400 – 1,000 RPM	800 – 32,000 hp	Locomotives, inland towing, ocean towing, oil services, harbor towing, fishing, power generation	EMD, GE, Caterpillar/MAK, MAN B&W, Colt-Pielstick, Wartsila
High Speed	Over 1,000 RPM	50 – 8,375 hp	On- and off-road trucks and equipment, oil services, inland towing, power generation, locomotives	Caterpillar, Cummins, MTU, Mitsubishi, Volvo, John Deere

Basic Diesel Engine Types

Slow Speed Diesel Engine

Medium Speed Diesel Engine

High Speed Diesel Engine

	No. of Engines*	% of Outstanding Population
EMD	4,500	39%
Detroit Diesel	3,300	29%
Caterpillar	2,400	21%
Cummins	1,200	11%

Marine Engines

* Estimated marine engines

What We Do

•   Sell new & remanufactured OEM parts

–  EMD and Alco medium speed diesel engines

–  Caterpillar, Cummins and Detroit Diesel high speed diesel
 engines in Midwest market

•   Provide skilled labor & specialty services

–  Diesel engine repairs, overhauls & rebuilding

–  Marine reduction gear repairs & overhauls

Seattle

Paducah

Houma

Chesapeake

Rocky Mount

Tampa

Miami

Facility Locations

2004 Revenue

Rail

21%

Marine

59%

Power

Generation

  20%

KES Primary Markets

Revenue Sources

•   Part Sales (51%)

–  New parts

–  Nuclear parts dedication

–  Rebuilt parts

•   Services (49%)

–  Complete overhauls to OEM specifications

–  ABS certified block welding

–  In-place machining

–  Laser alignment

–  Troubleshooting

–  Preventive maintenance

–  Engine controls modifications

Top Ten Customers

•   America Electric Power (AEP)

•   Amtrak

•   Crowley

•   ENSCO (ESV)

•   Exelon (EXC)

•   Ingram Barge Company

•   Maritrans (TUG)

•   Moran Towing

•   New Jersey Transit

•   Tidewater, Inc. (TDW)

59% of Total Revenue

Marine Markets

Marine Market Drivers

•   Market Drivers

–  Chemicals, petrochemicals, fertilizer, black oil, refined products,
 grain, coal, cement & steel

–  General import/export activity

•  Containers

•  Break bulk

–  Exploration and drilling

21% of Total Revenue

Rail Markets

Rail Market Drivers

•   Market Drivers

–  Commuter demand

–  Chemicals, petrochemicals, fertilizer, black oil, grain, coal,
 cement, automotive and steel

–  Containers

20% of Total Revenue

Power Generation Markets

Power Generation Market
Drivers

•   Market Drivers

–  Increasing electrical demand

–  Nuclear license renewals

–  Technology upgrades/modifications

–  Maintenance outsourcing

Growth Opportunities

•   Organic

–  Emissions Reduction Programs - new services to existing
 customers

–  Term Maintenance Contracts

•   Acquisition

–  Competitors

•   High Speed Diesel Engine Services

–  Engine Populations

•  New product lines for existing customers

•  New product lines for new customers

2:00 – 2:05	Welcome and Introductions
2:05 – 2:30	U.S. Inland Waterways
2:30 – 3:00	Kirby Overview
3:00 – 3:15	Kirby Inland Marine · Kirby and Industry Fleet Profile
3:15 – 3:30	Break 15 minutes
3:30 – 3:50	Kirby Engine Systems Overview
3:50 – 4:35	Outlook for the Petrochemical Industry · Chemical Market Associates, Inc.
4:35 – 5:20	Refined Products Supply & Demand Drivers · Purvin & Gertz, Inc.
5:20 – 5:25	Closing Remarks

Agenda

Kirby Analyst/Investor Meeting

Outlook for Commodity

Chemicals in the United States

May 19, 2005

Presented to:

Transportation Analyst Group

 

Outline

•   40,000 ft  - Global Economic
  view, petrochemical cycle,
  new investment

•   10,000 ft– Changing role of
  U.S. olefins industry, impact
  on feedstocks & derivatives

•   River Level– Bottom line,
  things are changing, but  liquid
  movements expected to trend
  higher

Chemicals & plastics markets

     are in a full revival mode

Economic recovery firmly

     entrenched – especially in

     Asia & Americas.

The rate of new capacity

     additions increasing but

     remaining measured

Hyper natural gas & oil markets

     maintaining high price levels

Producers leveraged their position of market strength,     
   improved  profitability regardless of cost changes

Current Global Market Conditions…

Short-term Outlook Is Somewhat Tempered

Developing world healthy, Japan and Europe slowing

Geopolitical Uncertainties & High Energy are a big negative

Services Sector still very strong. Can China moderate?

Sustained by Longer-term Supporting Strengths

Monetary and Fiscal policies imply continuation

Moderately higher interest rates are still simulative

Banking Systems supportive and functioning well

International trade still gaining momentum (WTO)

Global Expansion Remains Firmly Entrenched

Recovery still responding to several stimuli

Developed Country consumption remains strong

The Economic Outlook

Next Two Years

Global GDP Growth Rates

Constant 2000 Dollars

-2

-1

0

1

2

3

4

5

6

7

8

81

83

85

87

89

91

93

95

97

99

01

03

05

07

09

Percent Change

Global

U.S.

Demand Is Robust!

Petrochemicals

Health Care

Household Goods

Rubber & Plastics

Transportation

Construction

Food &
Beverage

Textiles

Electronics

Impact of High Energy Prices

•   Economies have
  underperformed by about
  0.75 points

•   Extreme volatility

•   Declining energy prices
  will be supportive of
  economic growth in 2007
  - - 2009

Feedstock Cost: Impacts all Regions
(well, some more than others…)

•   Dramatic Increase in
  North America with
  higher natural gas
  prices

•   Up in West Europe,
  Latin America & Asia
  with $50+ per barrel
  crude oil

•   Middle East remains
  the lowest

Middle East Advantage is All Natural Gas
Based

$7.50/$50

$5.50/$47

$1.00/$45

$4.50
/$49

Nat Gas $/MMbtu / Crude Oil $/bbl

Ratio of Natural Gas vs. Crude Oil Price in the U.S.

40%

50%

60%

70%

80%

90%

100%

110%

120%

Environmental emphasis was not offset with sufficient supply incentives

Drilling (replacement) rates have not maintained pace - steady demand growth

Market will produce sufficient supply/demand reaction – at best, back to parity
    (Conservation – Demand Switching – LNG Terminals – Northern Gas) 

Btu basis using 6 million per bbl for oil

40%

50%

60%

70%

80%

90%

100%

110%

120%

U.S. petchem industry was built on natural gas - an abundant and low cost fuel

Current Crude Oil

Current Nat Gas

U.S. Energy
Values

10

15

20

25

30

35

40

45

50

55

86

87

88

89

90

91

92

93

94

95

96

97

98

99

00

01

02

03

04

05

06

07

08

09

10

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

($ per barrel)

($ per mmBtu)

Market Forces Will Eventually Return Energy
Prices To Fundamental Levels (Greenspan April-05)

Rising crude oil prices impact
  chemicals sector earnings
  most severely in periods of
  oversupply

Strong market conditions
  allow producers to pass
  through rising costs (and
  more), building up margins

Cost push supported price
  increases facilitate higher
  earnings when cost fall – but
  tight conditions must persist

Sector Leverages High Energy Prices...

Basic Chemicals and Plastics

Annual Demand Growth

0

5

10

15

20

25

30

90

91

92

93

94

95

96

97

98

99

00

01

02

03

04

Million Metric Tons

Timing &
Duration

Ethylene
Glycol

There now or
may not get
there

Remain above
for several
more years

From a Re-Investment Perspective

From a
Historical
Perspective

Lower than
before

Higher than
previous
peaks

PET
Resins

PE
Resins

PP
Resins

Ethylene

Propylene

Benzene

ECUs

Methanol

Paraxylene

Styrene

PS
Resins

PVC
Resins

Quality of
the
Earnings

From a non-integrated
vantage

Up Cycle Peak Earnings Profile

Americas

Europe

Middle East/Africa

Asia Pacific

-2

0

2

4

6

8

10

Million Tons

00

01

02

03

04

05

06

07

08

09

10

Global Ethylene Capacity Growth

Global Assembly Line

Commodities to Converted Products to Retail Goods…

Growth In Chemicals
Demand Will Continue
To Outpace That Of
The World  Economies

Extremely Efficient
Supply Chains Have
Been Developed -
Internationals and WTO
Very Supportive

Improving Standard Of
Living In China Has
Significantly Increase
Internal Consumption

Implies That Current
Pace Of Additions Can
Be Absorbed As Long As
Restraint Continues

Hydrocarbon

Value

Labor Cost

Consumer
Demand

Largest Deleterious
Impact on PE

World

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0

99

00

01

02

03

04

05

06

07

08

09

PE 3.6 / 4.9*

Ethylene Oxide 4.0 / 5.3*

EDC 2.4 / 3.2*

EBZ 3.4 / 4.1*

Others 1.2 / 3.0*

Capacity 3.6 / 4.8*

Million Metric Tons

*%AAGR 99-04 / %AAGR 04-09

Ethylene Demand Forecast

Total Demand Growth = 4.4% AAGR 2004-09

0

100

200

300

400

500

600

700

800

00

01

02

03

04

05

06

07

08

09

Dollars Per Ton

U.S. Ethane

U.S. Light Naphtha

WEP Naphtha

NEA Naphtha

Global Ethylene Cash Margins

Ethylene Margin Outlook Very Positive

U.S. Producers Respond

by Closing or Revamping E/PUnits

Feedstock Required Per Ton of Ethylene

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

Ethane

Propane

Butane

Light Naphtha

Gasoil

Tons

0

0.5

1.0

1.5

2.0

2.5

3.0

Ethane

Propane

Butane

Light
Naphtha

Gasoil

Volume of Liquid Co-products

per Ton of Ethylene

Tons

0

5

10

15

20

25

30

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Million Tons

Ethane/Propane

   Naphtha

   Gas Oil

Others

Butane

U.S. Ethylene Production by Feedstock

(trend is flat to declining)

0

10

20

30

40

50

60

70

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Million Tons

   Naphtha

   Gas Oil

Butane

Ethane/Propane (pipeline)

U.S. Ethylene Feedstock Requirements

(heavier feedslate will require increased liquid movements)

Co-Product Yield

Avg 2.7 million
tons/yr more than
2004 baseline

0

2

4

6

8

10

12

14

16

18

20

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Million Tons

Propylene

Butadiene

U.S. Propylene & Butadiene

Domestic Demand Forecast

Avg 1.0 million
tons/yr more than
2004 baseline

Regional Refining & Reforming

0

5

10

15

20

25

SAM

ISC/SEA

AFR/MDE

CEP/FSU

NEA

WEP

NAM

Crude Refining Capacity

Reforming Capacity

MMBPCD

Sources: PGI/CMAI

0

5

10

15

20

25

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Million Tons

Benzene

Styrene

Cumene

Phenol

Cyclohexane

U.S. Benzene & Derivative

Domestic Demand Forecast

Avg 500 thousand
tons/yr more than
2004 baseline

0

2

4

6

8

10

12

14

16

18

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Million Tons

Mixed Xylene

Paraxylene

Toluene

U.S. Xylene & Toluene

Domestic Demand Forecast

Avg 600 thousand
tons/yr more than
2004 baseline

U.S. MTBE Federal Actions – Will it Pass?

•   Federal Ban to pass eventually, but
  tough negotiation still required.

•   Energy Bill has been stalled in
  Congress since 2000, high priority
  for 2005.

–  Oxygen Mandate removed effective
 270 days after the bill is signed

–  MTBE banned explicitly beginning
 2015, but individual states can
 override and production for export
 expressly permitted

–  Renewable Fuels Standard (RFS) in
 2007 (?)

NAM

49.3%

SAM

1.6%

WEP

16.7%

CEP

6.4%

NEA

13.4
%

SEA

3.8%

MDE

7.7%

ISC

0.4%

AFR

0.8%

Total Demand =
16.1 Million Tons

2004

2009

NAM

26%

SAM

2%

WEP

12%

CEP

12%

NEA

23%

SEA

6%

AFR

1%

MDE

17%

ISC

1%

Total Demand =
10.8 Million Tons

Global MTBE Demand

- adopted ban prior to 2004

- adopted ban in/after 2004

- pending

States with MTBE Ban

3.1%

States with MTBE Ban

% consumption

- adopted ban prior to 2004

- adopted ban in/after 2004

- pending

31.7%

0.8%

1.1%

7.5%

States with MTBE Ban

% consumption

- adopted ban prior to 2004

- adopted ban in/after 2004

- pending

States with MTBE Ban

- adopted ban prior to 2004

- adopted ban in/after 2004

- pending

0

5

10

15

20

25

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Million Tons

MTBE

Methanol

U.S. MTBE, Methanol & Ethanol

Domestic Demand Forecast

Ethanol

Mitigating Factors Around MTBE

•   Vast Majority of MTBE moves via pipeline

•   States retaining MTBE are in Gulf Coast region

•   MTBE ban requires greater movement of other octane
  components

•   RFS will ultimately lead to longer mid-west to coast and
  inter-coastal barge movement of ethanol (all forms of
  ethanol are prohibited in pipeline system)

•   Japan evaluating large ETBE requirement for Kyoto
  Agreement that would require several U.S. units to convert

•   Isobutane dehydro units will be retrofitted to iso-octane
  swapping out MTBE movements

Conclusions

•   Global petrochemical markets are enjoying a
  significant up-cycle

•   Naphtha/gas oil based ethylene production
  remains competitive in the industrialized
  regions

•   U.S. producers have moved towards cracking
  more liquids that increase both feedstock and
  co-product volumes and traffic

•   Basic aromatics production is dominated by
  refinery sources and the U.S. remains the clear
  leader in supply

•   MTBE reductions will be largely off-set by
  ethanol opportunities

2:00 – 2:05	Welcome and Introductions
2:05 – 2:30	U.S. Inland Waterways
2:30 – 3:00	Kirby Overview
3:00 – 3:15	Kirby Inland Marine · Kirby and Industry Fleet Profile
3:15 – 3:30	Break 15 minutes
3:30 – 3:50	Kirby Engine Systems Overview
3:50 – 4:35	Outlook for the Petrochemical Industry · Chemical Market Associates, Inc.
4:35 – 5:20	Refined Products Supply & Demand Drivers · Purvin & Gertz, Inc.
5:20 – 5:25	Closing Remarks

Agenda

Kirby Analyst/Investor Meeting

U.S. Refining Industry Outlook

Bill Sanderson

May 19, 2005

Agenda

Ø   U.S. Economic and Product Demand Outlook

Ø   Refining Industry Outlook

Ø   Regional Product Movements

Percent Annual Growth

Note: GDP forecast provided by CMAI.

U.S. GDP and petroleum demand growth are
expected to remain strong short-term . . ..

2005 – 2010

Year-to-Year Change, Thousand B/D

U.S. refined product demand is expected to
stay strong through this economic cycle . . ..

Will gasoline demand growth slow down
longer term?

Ø   Higher prices are beginning to affect consumer
  choices

§  Large SUV sales are beginning to fall

§  Hybrid sales are beginning to gain acceptance

Ø   In our view, policy and market factors are likely
  to increase vehicle efficiency after 2010

Ø   Greenhouse Gas control may eventually
  become a U.S. regulatory goal, but not yet

Note:  Average U.S. new car efficiency

Miles per Gallon

Technology, policy and market factors expected
to increase new vehicle efficiency long-term ...

Five-Year Demand Change (Millions of B/D)

Gasoline demand to stay strong through  2010.
Diesel/jet fuel demand will remain strong  . . .

MTBE

Ban

(Cal.

and NY)

Low

Sulfur

Diesel

(15 ppm)

Low

Sulfur

Gasoline

(30 ppm)

(Tier 2)

Carbon taxes or

emissions controls?

2000-2006

2006-2010

Regulatory changes will continue to strongly
influence U.S. refining and distribution . .. .

Renewable Fuel Requirements

MTBE Phaseouts

Increasing Vehicle Efficiency

Zero-sulfur fuels?

2010 +

Gasoline quality will continue improving . . .  

Ø   Sulfur is being reduced to 30 ppm

§  Sulfur poisons automobile emissions catalysts

§  Sulfur reductions provide …

•  Immediate emissions reduction impact on entire fleet

•  NOx trap capability

Ø   MTBE and Ethanol use will change

§  Nationwide MTBE ban expected, with many states
 moving more quickly

§  RFG oxygen mandate expected to disappear

§  Renewable mandate expected to boost ethanol

§  Current Energy Bill contains all these elements

Both programs will affect the refining and
distribution industries . . ..

Gasoline Supply and Cost Impacts

Diesel Supply and Cost Impacts

Ø   Upgrading of existing desulfurization capacity most common

Ø   May tighten international low-sulfur markets

Ø   Distribution, contamination issues remain unresolved

Ø   Recovery of ULSD costs of 5.0-6.0 cpg (vs 0.2%) expected

Ø   Refining investment to offset octane loss

Ø   Potential import reductions from non-complying suppliers

Ø   Increased domestic gasoline trade

Ø   Reduction in finished product distribution flexibility

Ø   Strong U.S. petroleum demand growth should
  continue through 2010

Ø   Vehicle efficiency gains expected to reduce
  growth after the turn of the decade

Ø   Diesel growth will be stronger than gasoline

Ø   Refining capacity should remain tight for several
  years, due to investment lag times and focus on
  clean fuels compliance

Ø   Strong demand for U.S. product trade expected to
  continue in the near-term

Supply/Demand Conclusions

Agenda

Ø  U.S. Economic and Product Demand Outlook

Ø   Refining Industry Outlook

Ø  Regional Product Movements

U.S. Refinery Utilization of Operating Capacity, %

Maximum Sustainable Capacity

Annual Average

Note: Figures are distillation capacity utilization for operating refineries. 

U.S. refinery utilization has been operating at
or near capacity since the late 1990s . . .

U.S. Crude Supplies by Source – Million B/D

Growth in crude oil supplies will be sourced by
offshore imports and Canadian supplies .. . .

V

IV

III

II

I

The U.S. market is divided into five Petroleum
Administration for Defense Districts (PADDs) . . .

PADD III includes the U.S. Gulf Coast which is
the largest refining region in the U.S. .. . .

740

2,270

1,770

2,130

Total PADD III Distillation Capacity = 8.2 Million B/D

590

Note: Figures are distillation capacity for operating refineries in ‘000 B/D. 

570

120

Crude Runs by Region - Million Barrels per Day

The Gulf Coast (PADD III) is the largest refining
region, at roughly 50% of the U.S. total . . .

Gulf Coast Crude Oil Runs by Source, Million B/D

Gulf Coast (PADD III) crude runs will continue to
become heavier, driving refining investment ...

Midcontinent

Upper Midwest

Midwest

PADD II includes a number of sub-regions
comprised of smaller, local refining centers .. . .

Note: Figures are distillation capacity for operating refineries in ‘000 B/D. 

Total PADD II Distillation Capacity = 3.6 Million B/D

400

420

870

500

600

300

490

Midwest Crude Oil Runs, Million B/D

Midwest (PADD II) crude supply balance
reflects growth of Canadian production . . ..

Midwest Crude Oil Runs, Million B/D

Midwest crude runs become heavier requiring
conversion capacity investment . . ..

U.S. Refinery Distillation Capacity Changes

Thousand B/D of Capacity (Announced projects, excludes creep)

Million Barrels per Day

U.S. gasoline imports are expected to increase
until demand begins to slow late in decade . . .

Forecast in Constant 2005 Dollars per Barrel

Comparable Gulf Coast and Midwest margins
track relatively well due to market factors . .. .

Agenda

Ø U.S. Economic and Product Demand Outlook

Ø Refining Industry Outlook

Ø Regional Refined Product Movements

Refinery

Refining Centers

Refined product pipelines help integrate the
U.S. market . . .

Refined Product Transportation
Routes

Refinery

Refining Centers

But the inland waterway system remains
crucial in supplying certain markets . . ..

Inland Waterways

About 65% of PADD III products move to
consumers in PADDS I and II . . ..

PADD III Production

Major Light Products - Million B/D

Note: Major light products include gasoline, jet fuel and diesel fuels. 

PADD II depends on PADD III for over 20% of
the total light product supply . . ..

Major Light Products - Million B/D

PADD II Consumption

Note: Major light products include gasoline, jet fuel and diesel fuels. 

PADD II receives large volumes of all light
refined products from PADD III . . ..

PADD II Net Receipts - Million B/D

Most light products move to PADD II by
pipeline  . . .

Thousand B/D

Note: Product movements from PADD III to PADD II in 2004. 

Thousand B/D

Waterborne commerce between PADD III and
PADD II has increased steadily . . ..

Note: Waterborne product movements from PADD III to PADD II. 

Thousand B/D

Movements from PADD III are primarily light
products . . ..

Note: Waterborne product movements from PADD II to PADD III. 

Thousand B/D

PADD II generally moves out surplus heavy
products by water, some light products move .. . .

Thousand B/D

Note: Waterborne movements from PADD II to PADD III. Figures for 2004

          are estimated.

Waterborne light product movements from
PADD III to PADD II are projected to grow . . ..

Note: Waterborne movements from PADD II to PADD III. Figures for 2004

          are estimated.

Thousand B/D

PADD II will remain in surplus for residual fuel
and asphalt . . ..

Conclusions

Ø   Continued demand growth in PADD II will require
  additional movements to markets served by the
  inland waterway system

Ø   Growing heavy crude processing in PADD II will
  increase the local surplus of asphalt and residual
  fuel

This analysis has been prepared for the sole benefit of Kirby Corporation. Neither the analysis nor any part of the analysis shall be provided to third parties without the written consent of Purvin & Gertz. Any third party in possession of the analysis may not rely upon its conclusions without the written consent of Purvin & Gertz. Possession of the analysis does not carry with it the right of publication.

Purvin & Gertz conducted this analysis utilizing reasonable care and skill in applying methods of analysis consistent with normal industry practice. All results are based on information available at the time of review. Changes in factors upon which the review is based could affect the results. Forecasts are inherently uncertain because of events or combinations of events that cannot reasonably be foreseen including the actions of government, individuals, third parties and competitors. NO IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE SHALL APPLY.

Some of the information on which this analysis is based has been provided by others.  Purvin & Gertz has utilized such information without verification unless specifically noted otherwise.  Purvin & Gertz accepts no liability for errors or inaccuracies in information provided by others.

Terms and Conditions

U.S. Refining Industry Outlook

Bill Sanderson

May 19, 2005

2:00 – 2:05	Welcome and Introductions
2:05 – 2:30	U.S. Inland Waterways
2:30 – 3:00	Kirby Overview
3:00 – 3:15	Kirby Inland Marine · Kirby and Industry Fleet Profile
3:15 – 3:30	Break 15 minutes
3:30 – 3:50	Kirby Engine Systems Overview
3:50 – 4:35	Outlook for the Petrochemical Industry · Chemical Market Associates, Inc.
4:35 – 5:20	Refined Products Supply & Demand Drivers · Purvin & Gertz, Inc.
5:20 – 5:25	Closing Remarks

Agenda

Kirby Analyst/Investor Meeting

•   Fundamentals have not been this good in 25 years

•   Business will continue to consolidate. Kirby is best
  positioned company to be the consolidator.

•   Strong free cash flow

•   Great operating leverage

•   Age profile of fleet provides hedge against over
  building

•   Best transportation franchise around

Why is Kirby a Good
Investment?