A&B Profits Down Prior to Matson Split

Matson's first ship the Emma Claudine as she looked in 1882. D. Obrien photo.

By Sonia Isotov

Alexander & Baldwin, Inc. (A&B) yesterday reported net income for the first quarter of 2012 of $3.8 million, $1.4 million less when compared to last year, when net income was $5.2 million.

The company reports that this net income loss was due mainly to the separation expenses and losses related to the recent shutdown of its second China-Long Beach Express (CLX2) service in the third quarter of 2011.

Revenue, on the other hand, for the first quarter of 2012 was $405 million, compared to $373.3 million for the first quarter of 2011.

“Our leasing and agribusiness units continued their strong performance in the first quarter, and we saw an increase in Ocean Transportation operating profit, where improved results in Guam and China offset lower container volumes in Hawaii,” said Stanley M. Kuriyama, president and chief executive officer at A&B, in a written statement.

Real estate leasing operating profit including discontinued operations in the quarter of $10.7 million was slightly higher than the $10.6 million recorded last year. Agribusiness also performed well, posting operating profit for the first quarter of $3.5 million, compared to $2.6 million last year.

The Matson barge MV Maunalei. Photo courtesy of Matson.

“We are seeing positive signs of an improvement in Hawaii’s economy due to strong tourism performance, as well as indications that Hawaii’s real estate markets may be reaching a positive inflection point,” continued Kuriyama, pointing to A&B’s 340-unit Waihonua highrise condominium project in Kakaako, near the Ala Moana Shopping Center where the company has secured 192 binding sales contracts since pre-sales began in December.

As a result of the favorable sales results, the company plans to move forward with construction sometime in the third quarter. The company also expects that the increase in demand for real estate will translate into improvement in Hawaii’s construction industry and a positive effect on Matson’s shipping volumes

“Finally, we remain on track for the previously announced separation of our transportation and real estate/agriculture businesses into two stand-alone, publicly traded companies. Pending receipt of certain regulatory approvals, we are targeting completion of the separation early in the third quarter of this year,” concluded Kuriyama.