The increase, which came on a 20 percent rise in revenue to $377 million from $314 million, offset poor sugar business for the publicly owned diversified firm based in Honolulu.

Analysts had been expecting A&B to report per-share profits of about 56 cents, compared with actual results of 71 cents per basic share. A year earlier, net income per share was 56 cents.

Allen Doane, A&B president and chief executive officer, said strong ocean transportation and real estate gains during the quarter may not be sustained at that level for the rest of the year, though "the outlook remains very good for A&B to report increased earnings this year."

A&B subsidiary Matson Navigation Co. posted a 35 percent increase in operating profit, from $23.2 million in the 2003 second quarter to $31.4 million in the recent quarter.

The increase was aided by a 2003 excise tax accrual that was not repeated in the recent quarter. A 1 percent increase in container volume, higher yields and flat year-over-year costs also helped Matson, which achieved a record second-quarter profit margin, the company said.

Second-quarter operating profit from real estate sales and leasing was $22.6 million, up 38 percent from $16.4 million in the year-earlier period.

The company said most of the expected property sales for the year closed during the first two quarters.

Sales during the second quarter included 13 Maui and O'ahu commercial properties for $8.9 million, three residential development parcels for $13.8 million, one office condominium for $1 million, and five residential properties for $4.3 million. Proceeds also included $1.3 million of profits from three real estate joint ventures.

Second-quarter operating profit for A&B food operations, which include Hawaiian Commercial & Sugar Co. and Kauai Coffee Co., was $300,000, down 87 percent from $2.3 million in the year-ago quarter.

Results reflected poor sugar harvest and low raw sugar prices, according to the company, which said production fell 23 percent because of wet fields and cane that was not burned adequately. "The rest of the year will be very difficult for this segment," Doane said.

A&B stock closed up 71 cents at $32.64 yesterday after earnings were announced. The closing price was down from a 52-week high of $34.88 on March 1, and above the low of $26.57 on Aug. 6, 2003.