A&B reports lower earnings
Advertiser Staff and News Services
Alexander & Baldwin Inc. yesterday reported second-quarter earnings that matched lowered expectations, reflecting a tighter shipping market and fewer property sales.
The Honolulu-based diversified company said second-quarter operating profit was $47.8 million, down 10 percent from $53.1 million in the second quarter of 2000. In both the second quarter and first half of 2001, the company said the sale of Pacific Century stock, and the results for property leasing and food products added to gains in operating profit, but results for the ocean transportation segment and property sales were lower.
Net income for the quarter was $24.5 million, or 61 cents a share. That was lower than the $28.2 million, or 69 cents a share, for the same quarter a year ago.
Revenue rose to $294.2 million compared to $289.2 million in the same year-ago period.
Results were in line with the company's earnings guidance last month indicating that its second-quarter profit expectations would be about 10 percent to 15 percent below last year's.
A&P operates the ocean transportation business Matson Navigation Co. Inc., the real estate firm A&P Properties Inc., Hawaiian Commercial & Sugar Co. and Kauai Coffee Co.
"As we anticipated in our outlook announcement in early June, income in this year's second quarter was lower than last year's," said W. Allen Doane, company president and chief executive officer. "A large factor in the quarter was the reduced level of profit contribution from Matson.
"This decline resulted from a slowdown in both the U.S. mainland's and Hawai'i's rates of economic growth, and from increased competitive activity and associated cost pressures in several of Matson's services.
"Matson has taken immediate actions to improve its performance in the second half of the year, including comprehensive operating cost reductions and improvements in productivity."
Doane added that the economic outlook continues to be uncertain and earnings expectations remain cautious. Second-quarter ocean transportation operating profit was $18.7 million, a drop of about 33 percent from $27.9 million in the second quarter of 2000.
The company said the drop resulted primarily from slightly lower cargo volume, higher fleet costs, higher information technology expenses, and lower results from a stevedoring joint venture, partially offset by rate actions.
Second-quarter container volume was 2-percent lower than in the second quarter of 2000; automobile volume was 2 percent higher.
A&P Properties Inc.'s total operating profit in the second quarter of 2001 was $12.2 million, a decrease of 54 percent from $26.5 million a year earlier. The company's food products segment had a second-quarter operating profit of $747,000, compared with an operating loss of $2.1 million in the second quarter of 2000.