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Revenue falls 11% for Horizon Lines


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POSTED: Saturday, April 25, 2009

CHARLOTTE, N.C. » Horizon Lines Inc. said a significant slowdown in its Hawaii market and other volume declines, as well as antitrust legal expenses, contributed to the company losing $10 million during the first quarter.

Chuck Raymond, the Charlotte-based company's chairman, president and chief executive, said yesterday that volume declines were worse than the usual seasonal drop-off during the quarter “;due to the continued sharp slowdown of our Hawaii market, ongoing economic stagnation in Puerto Rico, and a severe winter in Alaska.”; He said that was partially offset by an increase in revenue-per-container rates of 3.3 percent, not counting fuel expenses.

The shipping, trucking and logistics firm had a loss of 33 cents per share for the quarter that ended March 22, compared with a profit of $726,000, or 2 cents a share, during the same period last year. Revenue fell almost

11 percent to $272.4 million from $305.9 million a year ago.

The loss would have been $4.7 million, or 15 cents a share, after adjusting for antitrust legal expenses and a restructuring charge.

John Keenan, president of Horizon Lines LLC, said volume in Hawaii and Guam declined 13 percent last quarter from a year ago and that the shortfall was driven by the “;quick and steep decline in tourism that began in the second half of 2008 as a result of the worldwide financial crisis.”;

Still, Keenan said he expects the volume reduction in Hawaii to moderate and that the company will have a better idea as the year unfolds.

“;Hawaii has been fairly stable and holding its own based on what our expectations and forecast was,”; Keenan said.

Horizon, the second-largest ocean shipper in the islands behind Matson Navigation Co., accounts for approximately 36 percent of total U.S. marine container shipments from the continental U.S. to Alaska, Hawaii, Puerto Rico and Guam.

The company said there are too many uncertainties to give specific 2009 financial guidance, but it said it expects earnings before interest, taxes, depreciation and amortization to be slightly below its 2008 results. It said it would revisit guidance at the end of the second quarter.

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Star-Bulletin writer Dave Segal contributed to this story.