A&B sees 16 percent jump in profits

The company's Matson unit had a gain despite hard year

By Russ Lynch
Star-Bulletin

Higher operating profits at its Matson Navigation Co. subsidiary helped push Alexander & Baldwin Inc.'s fourth-quarter profit up 16.3 percent to $20 million, or 44 cents a share.

In the final quarter of 1996, A&B earned $17.2 million, or 38 cents a share.

The latest quarter's net reported today, however, was lower than the 48 cents a share predicted by a Wall Street analyst cited by Zack's Investment Research. A&B shares today fell 37.5 cents to close at $27.75 in Nasdaq 7market trading.

Yesterday, A&B announced a half-cent increase in its quarterly dividend to 22.5 cents a share, payable March 5 to shareholders of record Feb. 13.

Revenues for the quarter of $335.3 million were up less than 1 percent from $332.8 million in the year-earlier quarter.

A&Btoday said its Matson shipping line had a dip of 1 percent in its Hawaii-mainland container volume and an 11 percent drop in the number of automobiles carried, comparing the fourth quarter of 1997 with the 1996 quarter. However, A&B said Matson, which produces more than half the corporation's total revenues, showed a 14.4 percent increase in fourth-quarter operating profits to $19.1 million from $16.7 million in the 1996 quarter. The gain came mostly from lower overhead charges and improvements in the Pacific Coast and Guam services, the company said.

Matson eariler this week said 1997 had been its worst year in the decade due to labor problems and Hawaii's stagnant economy.

Reduced sugar yields on Maui and lower production and prices at the refinery in California cut into the A&B quarterly operating profit from the company's food products business to $5.9 million, less than half the $13.2 million produced in the 1996 quarter. However, the 1996 operating profit had included $3.6 million that had been set aside as a reserve for anticipated costs in closing a Kauai plantation. The costs were not as high as expected, A&B said.

From property leasing, A&B showed a fourth-quarter operating profit of $5.8 million, up 2 percent from $5.7 million. Property sales produced a fourth-quarter operating profit of $7.3 million, up 115 percent from $3.4 million in the year-earlier period. Property sales in the latest quarter included two parcels in a Maui business park and an undeveloped 24-acre residential property on Kauai.

For all of 1997, A&B reported a net profit of $81.4 million, or $1.80 a share, on revenues of $1.28 billion, up 24.7 percent from a net of $65.3 million, or $1.44 a share, on revenues of $1.24 billion. The 1996 result included a one-time operating profit item of $20 million from an insurance settlement.