MATSON’S 4Q PROFIT HIT BY WEST COAST DISPUTE
Alexander & Baldwin, Inc., the parent company of Matson, reported a fourth-quarter operating profit of $9.9 million from its ocean transportation and intermodal activities, despite the impact of the recent longshore labor dispute on the U.S. West Coast.
Alexander & Baldwin acknowleged that its latest results were hit by “more than $12 million in higher costs and lost revenue” from the port dispute, but said that its results still improved when compared to the fourth quarter of 2001, when its activities were affected by the impact of Sept. 11.
“In the fourth quarter, the West Coast longshore labor disruptions spoiled what had been, up to that time, a strong improvement in quarterly earnings since the start of the year,” said Allen Doane, president and chief executive officer of Alexander & Baldwin.
For the first time, Alexander & Baldwin published separate revenue and operating profit figures on its mature domestic ocean transportation business and on its growing intermodal services arm.
“This change is intended to make the respective growth rates and profit contributions of each of these different business activities clearer for investors,” the group said.
In the fourth quarter of 2002, ocean transportation revenue was $174.7 million, a 9-percent increase on the $160.3-million reported for the fourth quarter of 2001. The principal sources of the increase in revenue were higher cargo volume and, to a lesser extent, higher freight rates and a higher bunker surcharge. Hawaii service container volume was 1 percent higher than in the fourth quarter of 2001, while automobile volume was 11 percent higher. Fourth quarter 2002 operating profit in ocean transportation was $9.2 million, up from $1.6 million in the same quarter of 2001.
For the full year 2002, ocean transportation revenue rose 1 percent, to $686.9 million, from $682.3 million in 2001. Operating profit last year decreased by 30 percent, to $42.4 million, from $60.7 million in 2001. The decrease resulted primarily from effects of the longshore labor disruptions on the West Coast during the third and fourth quarters.
Commenting on its intermodal services business, the group said that fourth quarter revenue from intermodal services soared by 70 percent, to $52.4 million, from $30.9 million in the fourth quarter of 2001. New customers were the principal source of the increase in revenue. Fourth quarter 2002 operating profit on intermodal services was $0.6 million, up from $0.3 million earned in the fourth quarter of 2001.
For the year, intermodal services generated revenue of $195.1 million in 2002, up 60 percent when compared with the $122.0 million corresponding figure in 2001. Operating profit for the year on intermodal services rose to $3.1 million, from $1.6 million in full-year 2001.
Alexander & Baldwin, listed on the Nasdaq stock exchange, posted an annual net income of $58.2 million for 2002, down from $110.6 million in 2001.