Matson remains positive about reaching its 2014 goals
August 04, 2014
Matson, Inc. reported “another solid quarter,” benefitting from higher freight yields in transpacific trade lanes, improved lift volumes at their terminals, and continuing improvements in logistics.
However, says Matt Cox, Matson’s President and Chief Executive Officer, these benefits were offset by lower Hawaii container volume, increased vessel operating expenses stemming from vessel relief activities, and increased terminal handling expenses.
“Our operating platform continues to generate significant cash flow that positions us well to fund our fleet renewal program, undertake new growth opportunities and grow our dividend incrementally,” says Cox. “As we look to the balance of 2014, we expect overall results to exceed the results achieved in the second half of 2013.”
In the second half 2014, Matson expects ocean transportation operating income to significantly increase from the level achieved in the second half of 2013, which was $51.4 million (exclusive of a $9.95 million litigation charge). For the full year 2014, ocean transportation operating income is expected to be near or slightly above the level achieved in 2013, which was $104.3 million (exclusive of the $9.95 million litigation charge). This outlook excludes any future impact from the September 2013 “molasses incident.”
Matson’s logistics arm expects the second operating income to be near or slightly higher than comparable 2013 levels, and therefore expects operating income to modestly exceed the full year 2013 level of $6.0 million.
“We expect continuing improvement in volume growth, expense control and warehouse operations,” says Cox.
Logistics revenue increased $11.8 million, or 5.9 percent, during the six-month period ended June 30, 2014 compared to 2013. This increase was primarily the result of higher highway and international intermodal volume; partially offset by lower domestic intermodal volume.
Logistics operating income increased by $1.0 million during the six-month period ended June 30, 2014 compared to 2013. The increase was primarily due to a favorable litigation settlement, warehouse operating improvements and increased highway volume; partially offset by lower intermodal yield.
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