• ITVI.USA
    15,360.600
    75.400
    0.5%
  • OTLT.USA
    2.768
    -0.011
    -0.4%
  • OTRI.USA
    21.410
    -0.010
    0%
  • OTVI.USA
    15,331.810
    75.820
    0.5%
  • TSTOPVRPM.DALLAX
    1.590
    0.150
    10.4%
  • TSTOPVRPM.LAXSEA
    4.080
    0.130
    3.3%
  • TSTOPVRPM.LAXDAL
    3.330
    0.020
    0.6%
  • TSTOPVRPM.ATLPHL
    3.300
    0.000
    0%
  • TSTOPVRPM.PHLCHI
    2.170
    0.020
    0.9%
  • TSTOPVRPM.CHIATL
    3.140
    0.190
    6.4%
  • WAIT.USA
    125.000
    -1.000
    -0.8%
  • ITVI.USA
    15,360.600
    75.400
    0.5%
  • OTLT.USA
    2.768
    -0.011
    -0.4%
  • OTRI.USA
    21.410
    -0.010
    0%
  • OTVI.USA
    15,331.810
    75.820
    0.5%
  • TSTOPVRPM.DALLAX
    1.590
    0.150
    10.4%
  • TSTOPVRPM.LAXSEA
    4.080
    0.130
    3.3%
  • TSTOPVRPM.LAXDAL
    3.330
    0.020
    0.6%
  • TSTOPVRPM.ATLPHL
    3.300
    0.000
    0%
  • TSTOPVRPM.PHLCHI
    2.170
    0.020
    0.9%
  • TSTOPVRPM.CHIATL
    3.140
    0.190
    6.4%
  • WAIT.USA
    125.000
    -1.000
    -0.8%
American ShipperIntermodalWarehouse

MATSON SEES NEGATIVE IMPACT OF U.S. WEST COAST DISPUTE

MATSON SEES NEGATIVE IMPACT OF U.S. WEST COAST DISPUTE

   Matson Navigation, the shipping and intermodal subsidiary of Alexander & Baldwin, Inc., saw its third-quarter operating income drop by 24 percent, to $18.3 million, and warned that the West Coast port shutdown is having a negative impact on its earnings.

   The decrease in operating profit in quarter ended Sept. 30 included an estimated $1.1 million negative impact on earnings from the West Coast port dispute. The port shutdown started on Sept. 27.

      “The West Coast port shutdown at the end of the quarter also adversely affected operating profit, by deferring carriage of some cargo and termination of some voyages,” the company said.

   The lower profit figure for the quarter, as compared to the same period in 2001, resulted primarily from a one-time gain last year on the sale of a subsidiary, higher cargo handling costs, higher vessel operating costs and higher outside transportation charges.

   By contrast, ocean transportation revenue in the third quarter increased by 13 percent, to $234.8 million. The principal source of the increase in revenue was greater intermodal services business, an activity that has lower profit margins than Matson’s other businesses.

   Alexander & Baldwin warned that it is “highly unlikely” that Matson will be able to maintain its recent trend in quarter-by-quarter improvements in earnings in the fourth quarter.

   “The near-term earnings performance of A&B will be heavily influenced by the pace and ultimate outcome of labor negotiations affecting Matson’s operating costs, both in West Coast ports and in Hawaii,” a spokesman for A&B said. “Presently, the Matson fleet serving Hawaii and Guam is fully operational, but schedule integrity has been impaired by long wait times to access berths at West Coast ports, and by below-normal terminal productivity on the West Coast.”

   All of Matson Navigation’s container shipping activities use ports on the West Coast of the United States. However, Matson benefitted from an exemption agreed by the Pacific Maritime Association and the International Longshore and Warehouse Union to allow U.S. West Coast ports to handle shipments between the mainland, Hawaii and Alaska.

   The company reported that “extraordinary measures” have been taken to assist Matson’s customers in the movement of backlogged freight, including the activation of an additional vessel in the Hawaii trade. In addition, the positioning of container equipment has been disrupted, and some West Coast port calls have been eliminated, negatively impacting capacity utilization.

   While these factors are having an immediate impact on Matson’s business, the timing of recovery through increased rates is uncertain, the company said.

   In the third quarter, Hawaii service container volume was two-percent higher than in the same quarter in 2001; automobile volume was 22-percent higher. The rise in container volume was due to a small increase in westbound container cargo and lower-margin contract-carriage. Higher auto movements reflected increased rental car activity and rental fleet replacements in Hawaii.

   Alexander & Baldwin said that Matson’s Sand Island container terminal improved its productivity during the latest quarter.

   For the first nine months of 2002, ocean transportation revenue of $650.6 million was $43 million, or 7 percent, higher than $607.6 million in the first nine months of 2001.

   Operating profit in the first nine months of 2002 fell by 41 percent, to $35.6 million. The decrease resulted primarily from higher cargo handling costs at Matson’s Sand Island terminal, lower productivity in West Coast ports, and post-Sept. 11 economic effects on cargo volumes.

   Large transpacific container shipping lines are believed to have been hit financially much harder than Matson by the U.S. West Coast port shutdown.

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