Smaller profit at Alexander & Baldwin - Hawaii News Now - KGMB and KHNL

Smaller profit at Alexander & Baldwin

By Howard Dicus - bio | email 

HONOLULU (HawaiiNewsNow) - Alexander & Baldwin Inc. (NYSE: ALEX) made a $5 million profit in the first quarter, a third of what it made a year ago, on soaring fuel bills in its shipping operations.

Matson Navigation Co. Inc., the largest subsidiary of A&B and the major shipping line from the West Coast to Hawaii and Guam, reported a $7.4 million loss that dragged down net income for the parent company.

"The loss was attributable primarily to the precipitous rise in fuel prices, which outpaced Matson's ability to employ its fuel surcharge adjustment mechanisms to mitigate the impact," said A&B CEO Stan Kuriyama in a statement Tuesday.

In a reassurance to shareholders that may also be read as a warning to shippers, the quarterly report said, "The company believes it will recoup a large percentage of fuel cost increases through surcharge mechanisms in 2011."

In a happier sign for the Hawaii economy, Matson reported 8 percent higher container shipping volume to Hawaii during the winter quarter - 34,000 containers, compared to 31,400 a year ago. Matson is by far the largest container shipper to the islands, with Horizon Lines second. Guam volume fell. China Express business, hauling freight directly from China to Long Beach, Calif., doubled.

The quarter at a glance:

Revenue: $405.6 million. Year ago: $343.1 million.

Profit: $5.2 million. Year ago: $17.3 million.

Per share: 12 cents. Year ago: 42 cents.

A&B Properties reported lower commercial real estate sales than last year but called the results better than expected, while leasing levels on mainland properties improved. Hawaii occupancy fell four points but still came in at 90 percent.

The agribusiness division made a $2.6 million operating profit on higher molasses sales margins and upper valuation of the Kauai coffee inventory. A&B sold Kauai Coffee Co. to an Italian beverage conglomerate during the quarter, retaining ownership of the land and infrastructure.

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