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The Honolulu Advertiser
Posted on: Thursday, February 2, 2006

Real estate, leasing drive Alexander & Baldwin profit up

Advertiser Staff

Alexander & Baldwin Inc. profit rose 25 percent in the fourth quarter, largely on strong real-estate sales and leasing, and a small gain in agriculture operations that offset decreased operating profit in ocean transportation. Net income for the year was up 25 percent, rising to $126 million, compared with $101 million in 2004, for the Honolulu-based company.

FOURTH QUARTER 2005

Revenue: $398.5 million, up 1.5 percent from a year ago

Net profit: $23.4 million, up 25 percent from a year ago

Earnings per diluted share: 53 cents, up from 42 cents

Ocean transportation operating profit: $22.8 million, down 10 percent

Real-estate operating profit: $18.3 million, up 89 percent

Food operating profit: $2 million, up 54 percent

REASONS

  • Ocean transportation unit Matson Navigation Co. experienced a 3 percent drop in Hawai'i container volume and a 20 percent drop in automobile shipping because of competition and one less week in the quarter.

  • Major real-estate sales, including two downtown Honolulu office buildings, generated $7 million in real-estate division operating profit.

  • Sugar sales were down, but higher prices for molasses helped boost agriculture operations.

    WHAT THEY ARE SAYING

    "A&B's successful earnings performance in 2005 makes it difficult but all the more necessary to remind investors that we still expect that the results in 2006 will be lower. ... 2005 was a benchmark year."

    Allen Doane
    A&B President and CEO

    WHAT'S NEXT

  • Matson starts its ocean freight transportation service to China this week. The Guam-China service has generated significant start-up expenses for A&B.

  • A&B said its real-estate business prospects remain favorable, though residential markets in Hawai'i appear to be leveling.

  • Development project Kukui'ula, a master-planned Kaua'i community, is slated to break ground soon and complete initial sales in the fourth quarter.