Matson, Inc., which includes the liner carrier Matson Navigation Co. as well as Matson Logistics, saw first half revenue climb 7.5 percent year-on-year to $760.3 million.
The company’s liner business had revenue of $579 million in the first half, 12.9 percent higher than in the first half of 2011. Liner operating profit grew 14.6 percent to $37 million.
“The increase in the operating profit margin was primarily attributable to higher volume in the Guam trade lane and increased volume as well as increased rates in the China trade lane, offset partially by lower volume in the Hawaii trade lane,” the carrier said.
Matson Logistics, however, saw revenue and operating profit fade in the first half “primarily due to a decrease in highway, warehousing and international intermodal volumes.”
Revenue fell 6.7 percent to $181.3 million, while operating profit fell 55.6 percent to $1.3 million.
For the second quarter, the liner business had revenue of $299.5 million, 9.8 percent higher than in the corresponding period in 2011. Operating profit grew 15.1 percent to $31.2 million.
Matson said its financial results for the second quarter and first six months of 2012 reflect its separation from its former parent corporation, Alexander & Baldwin, Inc. (A&B), on June 29. The separation of Matson from A&B was originally announced on Dec. 1, 2011. Due to the structure of the separation, A&B’s non-Matson operations have been included in Matson’s financial statements as discontinued operations.
In the second quarter, Matson also executed a new $375 million five-year unsecured revolving credit facility with a syndicate of banks and raised $170 million of new long-term privately placed debt. Matson’s total outstanding debt at the end of the second quarter was $372.8 million.
“While we are reporting improved operating income for the second quarter compared with last year, the financial performance of our businesses continues to be mixed with weaker Hawaii freight volume more than offset by improved volume in Guam and improved freight rates in China,” said Matson President and Chief Executive Officer Matt Cox, in a statement. “Our volume in the Hawaii trade lane remains suppressed in part due to ongoing weakness in construction activity. However, we are benefitting from increased volume in the Guam trade lane resulting from the exit of a major competitor in late 2011 and improved rates for our premium niche service in the China trade lane. The financial performance of our wholly-owned subsidiary, Matson Logistics, is beginning to improve but continues to perform below 2011 levels due primarily to our Northern California warehousing business.” - Eric Johnson