Matson said its profits for the third quarter of 2016 were lower than a year prior because volumes on its Hawaii and Alaska trade routes were “lower than expected due to weaker market conditions.”
Matson reported a profit of $25 million for the third quarter of 2016, which ended Sept. 30, compared with a profit of $41.5 million for the same 2015 period.
The company said third quarter volumes in 2016 on its Hawaii and Alaska trade routes were “lower than expected due to weaker market conditions.”
Consolidated revenues for the quarter totaled $500.4 million compared with $544.3 million for the third quarter 2015.
“Matson’s third quarter results came in below our expectations,” said Matt Cox, Matson’s president and chief executive officer. “In Hawaii, there was a lull in container volume following healthy market growth in the first half of the year. In Alaska, energy sector related macroeconomic headwinds and a lower seafood harvest drove Matson’s container volume below our expected levels.”
Cox said the company was encouraged by strong demand for its eastbound container service from China and its steady performance in Guam.
“We made sizeable investments during the quarter that underscore our commitment and confidence in the long-term prospects for both Hawaii and Alaska,” said Cox, pointing to how Matson’s acquisition of Span Alaska this summer “significantly expanded Matson Logistics’ platform into freight forwarding and solidified Matson’s position as a critical freight transportation provider to Alaska.”
He also noted that in August, Matson ordered two new container/roll-on, roll-off ships for delivery by mid-2020 from the General Dynamics National Steel and Shipbuilding Co. in San Diego, Calif. and has two other ships already under construction at the Philly Shipyard in Philadelphia, Pa.
Cox said those ships “will complete the renewal of our Hawaii fleet and allow for an optimal nine-ship deployment with significantly lower operating costs, while ensuring superior reliability.”
He added, “For the balance of 2016, we expect our core businesses to continue generating strong cash flow which, combined with available capacity under our $400 million revolving credit facility and additional debt financings, will provide for our fleet renewal investments and the return of capital to shareholders.”
Matson reports $25m profit in Q3
