Posted on: Friday, February 2, 2007
A&B's 4th-quarter profit surge helps full-year earnings
Advertiser Staff
Fourth-quarter profits last year increased at Alexander & Baldwin Inc., but full-year earnings were down slightly. Quarterly results were boosted by new China service started by A&B's ocean transportation subsidiary, Matson Navigation Co., as well as better real-estate sales and leasing. Food operations lost money during the quarter.
2006 4TH QUARTER/YEAR
Revenue (quarter): $406 million, up 2 percent from a year earlier
Revenue (year): $1.6 billion, unchanged from the prior year
Net profit (quarter): $27 million, up 15 percent from a year earlier
Net profit (year): $122.5 million, down 3 percent from the prior year
Earnings per diluted share (quarter): 63 cents, up from 53 cents
Earnings per diluted share (year): $2.81, down from $2.86
REASONS
Ocean transportation unit Matson posted a 26 percent increase in fourth-quarter operating profit to $28.7 million largely from its new China service that carried 13,000 containers. Hawai'i container and automobile volume was down 5 percent and 30 percent, respectively.
Real-estate operating profit in the quarter was up 31 percent to $24 million from higher leasing and sales.
A&B's food division recorded a $3.3 million operating loss in the quarter vs. a $2 million profit a year earlier. The loss was largely from lower sugar prices and production as well as irrigation reservoir repairs.
WHAT THEY ARE SAYING
"2006 was a good year for Alexander & Baldwin, and it ended on a particularly positive note. ... Net income, which was only marginally below last year's, was gratifying. ... We exceeded our expectations for the year and are confident in our opportunities for continued success in 2007 and beyond."
Allen Doane
A&B chairman and chief executive officer
WHAT'S NEXT
Matson's Hawai'i and Guam shipping volume fell last year, primarily from declines in automobiles and construction materials, but A&B forecasts moderate earnings growth in 2007 based on cargo mix and yields.
Hawai'i's changing residential real-estate market may affect the timing of sales at some A&B projects in the pipeline, but the company expects solid growth in 2007 from its real-estate division.
Operating profit at A&B's food division was $6.9 million in 2006 versus $11.2 million in 2005 when the company got a federal government relief payment. This year the company expects "modest" profitability.
