Matson reaffirms its bright outlook

By Patrick Burnson, Executive Editor
May 07, 2014 - LM Editorial

Adhering to its initial positive forecast for 2014, Matson, Inc. says its businesses performed as anticipated in the first quarter of 2014, driven by sustained demand in their core markets and continued freight rate.

“While the timing of fuel surcharge collections significantly impacted financial results during this [past] quarter, our businesses are running well and continue to generate substantial cash flow,” Matt Cox, Matson’s President and Chief Executive Officer, told investors. “Coupled with our recent debt financing, we have ample capacity to fund our newbuild vessel commitments, pursue growth opportunities and maintain a healthy dividend.”

As reported here late last year, Matson announced that it raise its rates for the company’s Hawaii service by $175 per westbound container and $85 per eastbound container in 2014.

The company reported net income of $3.4 million, or $0.08 per diluted share for the quarter ended March 31, 2014. Net income for the quarter ended March 31, 2013 was $9.1 million, or $0.21 per diluted share. Consolidated revenue for the first quarter 2014 was $392.5 million compared with $394.7 million reported for the first quarter 2013.

“We continue to be encouraged by our prospects in Hawaii, and in a strengthening broader economy that will positively shape volume in our Jones Act trades and in Logistics,” said Cox. “We expect modest improvement at SSAT and that our premium expedited service offering from China will continue to be in high demand. As a result, we are positioned well to meet or surpass our financial performance from last year.”


Matson believes that the Hawaii economy is in a multi-year recovery and anticipates modest market growth in the trade in 2014. However, a competitor is expected to launch new containership capacity into the trade in the fourth quarter of 2014, which could impact the Company’s container volume. 

In the China trade, overcapacity is expected to continue at least through 2014, with vessel deliveries outpacing demand growth.  However, the Company expects to maintain its volume and average freight rates with high vessel utilization levels, as its expedited service continues to realize a premium to market rates. In Guam, muted growth is expected and the Company envisions its volume to be modestly better than 2013, assuming no new competitors enter the market.



About the Author

image
Patrick Burnson
Executive Editor

Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at .(JavaScript must be enabled to view this email address).


Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

The Institute for Supply Management’s (ISM) August edition of the Manufacturing Report on Business saw its PMI, the ISM’s index to measure growth, fall 1.6 percent to 51.1, following a 0.8 percent decline to 52.7 in July. Even with the relatively slow growth over the last two months, the PI has been at 50 or higher for 31 consecutive months.

Hackett observed in the new report that China’s economy has lost steam, with actual growth falling short of targeted rates, while the United States most recent second quarter GDP reading at 3.7 percent outpaced expected targets, even though it was negatively impacted by gains in manufacturing and retail inventories.

The proposed merger of Cosco and CSCL could spark further container consolidation

The average price dropped 4.7 cents to $2.514 per gallon, which now stands at the lowest weekly average price for diesel since July 2009, when it was at $2.542 the week of July 27, 2009, according to EIA data.

The Department of Transportation’s Bureau of Transportation Statistics (BTS) reported this week that U.S. trade with its North America Free Trade Agreement partners Canada and Mexico in June dropped 3.8 percent annually to $99.0 billion. This followed a 10.8 percent decline in May to $92.7 billion.

Article Topics

News · Ocean Freight · Container · Logistics · All topics

About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review. Patrick covers international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. Contact Patrick Burnson

Comments

Post a comment
Commenting is not available in this channel entry.


© Copyright 2015 Peerless Media LLC, a division of EH Publishing, Inc • 111 Speen Street, Ste 200, Framingham, MA 01701 USA