A slide presentation for today's conference call, as well as the earnings release, which was issued earlier today, can be found on our website. Earlier today, we announced first quarter earnings per share of $1.50, a 13% year-over-year increase compared to 2025's first quarter earnings per share of $1.33. Our first quarter results reflected improving market fundamentals in marine transportation, with utilization and pricing strengthening as the quarter progressed alongside continued strength underlying demand for power generation and Distribution and Services. While results were partially impacted by weather-related disruptions and navigational delays in our Inland Marine transportation operations and ongoing OEM-related supply constraints in Distribution and Services, underlying demand conditions remained strong across both segments.
In Inland Marine market fundamentals improved throughout the quarter as customer demand strengthened, refinery utilization increased, and barge availability remained limited. Entering the second quarter, demand visibility has continued to improve, supported by strong refinery utilization and improving conditions across petrochemical markets, contributing to strong utilization and improved pricing. This favorable supply-demand dynamic continued to drive pricing gains, with term contract renewal rates rising in the 20% range year-over-year. Turning to Distribution and Services, segment results reflected mixed conditions across our end markets, with power generation remaining a key growth driver.
Segment revenues increased 12% year-over-year but declined sequentially due to OEM engine availability and continued softness in conventional oil and gas activity. Operating income increased modestly year-over-year, though declined sequentially as margin performance varied across our businesses. In power generation, revenues grew 45% year-over-year from solid backlog execution and significant demand for behind-the-meter power solutions. Overall, the segment remains well-positioned with steady execution across a diverse portfolio of end markets.
| Metric | Period | Current guidance |
|---|---|---|
| Full-year EPS growth | FY2026 | Up 5% to up 15% (Raised) |
| Inland barge utilization | FY2026 | Low 90% range as the year progresses (Reaffirmed) |
| Inland revenue growth and margins | FY2026 | Low to mid single digits, margins high teens to low 20% range (Reaffirmed) |
| Coastal revenue growth and margins | FY2026 | Mid single-digit growth, operating margins high teens (Reaffirmed) |
| Distribution and services revenue | FY2026 | Flat to slightly up, operating margins mid to high single digits (Reaffirmed) |
| Q2 EPS impact from fuel escalator lag | Q2 2026 | Approximately $0.05-$0.10 negative (New near-term flag) |
| Q2 EPS impact from OEM engine delays | Q2 2026 | Approximately $0.10-$0.15 negative (New near-term flag) |
| Capital expenditures | FY2026 | $220 million to $260 million (Reaffirmed) |
| Metric | YoY | Note |
|---|---|---|
| Earnings per share | +13% | Improving marine fundamentals and power generation demand |
| Marine Transportation revenue | +4% ($21M) | Improved pricing and demand; operating margin 18% |
| Marine Transportation operating income | +4% ($3M) | Pricing gains offset by weather and navigational delays |
| Inland revenue | Flat | Improved conditions offset by year-ago comparison; up 4% sequentially |
| Coastal revenue | +23% | Strong demand and limited large-capacity equipment |
| Distribution and services revenue | +12% ($37M) | Power generation and strong marine repair activity |
| Distribution and services operating income | +3% (about $1M) | Power generation growth partly offset by mix |
| Power generation revenue | +45% | Backlog execution and behind-the-meter demand |
| Oil and gas revenue | -25% | Conventional frac softness on lower rig counts |
| Oil and gas operating income | -53% | Lower revenue, partly offset by cost discipline |
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| Inland demand and pricing | Bottoming, spot rebounding in January | Momentum building since March, spot about 10% above term and heading toward 15%, term flat to slightly up | Strengthening |
| Power generation / behind-the-meter | Backlog up about 30% YoY, shifting to behind-the-meter | Behind-the-meter eclipsing standby diesel in backlog, sold out on some OEMs through 2027, contracts up to 15 years | Accelerating, supply constrained |
| Venezuelan / heavy crude | Emerging, volumes not yet material | Driving more intermediates and heavies, even causing incremental barge moves as pipelines are oversubscribed | Materializing tailwind |
| Coastal market | Strong with pricing moderating from double digits | Up 23% revenue, about 20% renewal increases, heavy Q2 shipyards | Sustained strength |
| Jones Act waiver | Not discussed | Extended 90 days, minimal current impact on inland, some blue-water arbitrage moves seen | Watched, low near-term risk |