Fitch: Kirby outlook positive

Fitch Ratings said it revised the outlook for Kirby Corp. to positive from stable and affirmed its issuer default rating at BBB.

The revised outlook reflects improving conditions in the U.S. tank barge shipping industry, according to the agency.

The outlook also incorporates the view that as Kirby has grown in size the potential impact from debt funded acquisitions has become less of a concern, the agency said.

Kirby's ratings are supported by the company's stable operating performance, solid financial flexibility and strong free cash flow generation, Fitch said.

The company also benefits from its position as the largest operator in the inland tank barge market and one of the largest in the coastwise market, the agency noted.

Acquisitions in 2011 drove leverage well above Kirby's normal range, Fitch said. The company's debt-to-EBITDA ratio at year-end was 1.8 times compared with 0.7x at year-end 2010.

The agency said that strong free cash flows should allow Kirby to pay down a meaningful portion of its debt in the next two to three years.

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