Castle & Cooke’s
1997 net plunged

It says the sluggish isle economy
will hurt results this year as well

By Russ Lynch
Star-Bulletin

Castle & Cooke Inc. today reported a 23 percent jump in fourth-quarter profit but most of that was due to a one-time gain and the company's net income for all of 1997 was down nearly 58 percent from 1996.

The company said it earned $1.6 million for the final quarter of 1997, up from the $1.3 million reported for the equivalent period of 1996. However, $1.1 million of the 1997 quarter's gain came from the sale of an option on an Oahu property.

The Los Angeles-based company, which builds homes on Oahu and in California, Arizona, and Florida, reported a substantial drop in Hawaii sales and said the sluggish local economy will continue to hurt performance through 1998.

For 1997, the company reported net income of $3.9 million, down from $9.2 million in 1996.

Castle & Cooke said it turned over 165 Oahu homes to buyers in the latest quarter, a 19 percent drop from the 204 delivered in the 1996 quarter. In California, the company delivered only one home in the quarter, compared to eight in the year-earlier period.

For 1997, the company delivered 421 homes and 654 lots, down from 612 homes and 522 lots in 1996. "Since new-home orders have not yet begun to improve, we anticipate that this challenging market will continue to have a negative effect on our operating results in 1998," said David H. Murdock, chairman and chief executive officer.

The fourth-quarter net, equal to 4 cents a share, came from revenues of $77.5 million. In the year-earlier quarter, the net was equal to 1 cent a share from revenues of $91.7 million. The smaller per-share figure in the 1996 quarter was partly due to a bigger preferred stock dividend.

The company's profit from ongoing operations in the latest quarter was $997,000, a 40 percent drop from $1.7 million in the year-earlier quarter.

New-home orders in the fourth quarter of 1997 totaled 93, down from 111 in the fourth quarter of 1996, Murdock said.

The company reported a 12.1 percent gain in revenues from its two resorts on Lanai, $13 million compared with $11.6 million in the year-earlier period. The Lodge at Koele and the Manele Bay Hotel continued to lose money, however, although not as much, the company said.