Alexander & Baldwin Inc.'s net income plunged 76.9 percent in the third quarter as the company posted lower operating profits in its ocean transportation and real estate units and suffered another loss in its sugar operations.

Allen Doane, who announced last week that he was retiring as chairman and chief executive officer of the company at the end of the year, said in response to the difficult economic environment that A&B has taken necessary measures across all of its business units to better align its cost structure with the realities of today's conditions.

“;These efforts are producing tangible results,”; he said. “;The company remains on solid financial ground, and our core operating units continue to generate significant cash flow augmented by a multitude of cost-reduction programs and reduced capital spending.”;

Net income was $8.5 million, or 21 cents a share, compared with $36.8 million, or 89 cents a share, a year ago. Revenue fell 17.6 percent to $375.9 million from $456.2 million.

A&B subsidiary Matson Navigation Co., the state's largest ocean shipper, posted a 23 percent decline in operating profit to $24.2 million from $31.4 million, while its revenue fell 14 percent to $234.2 million from $272.8 million due to lower fuel surcharges, net volume decreases and lower rates in the China trade.

Hawaii container volume fell 12 percent amid the slowdown in the state's economy, while Hawaii automobile shipments decreased 3 percent, primarily due to the timing of rental fleet replacement shipments. Guam container volume fell 3 percent, but China volume edged up 1 percent due to the addition of a third port of call at Xiamen, China.

However, A&B President Stan Kuriyama, who will be taking over as CEO for Doane on Jan. 1, said volume declines showed signs of flattening from the second quarter and that margins are continuing to improve.

Matson's transportation-logistics services unit posted a 57 percent decline in operating profit to $2.2 million from $5.1 million, while revenue fell 30 percent to $82.3 million from $118.1 million, primarily due to lower volume in all service lines and lower rates, which were mainly the result of lower fuel surcharges and competitive pricing pressures.

In A&B's real estate units, leasing profits slipped 8 percent to $10.2 million from $11.1 million, and revenue fell 4 percent to $25.2 million from $26.2 million. A&B attributed the decline to lower occupancies and rents, primarily in its mainland portfolio; the net effect of property sales and acquisitions; and the nonreinvestment of proceeds from a late 2008 sale. A&B's occupancy rates for its mainland properties fell 12 percentage points to 83 percent, while in Hawaii they decreased 3 percentage points to 95 percent.

A&B's profit from real estate sales last quarter fell 86 percent to $3.5 million from $25.8 million due to lower sales volume, while its revenue from sales declined 81 percent to $14.9 million from $77.2 million. In the third quarter, A&B sold an industrial property in Los Angeles and two parcels on Maui. During the quarter, A&B also purchased Waipio Shopping Center and a two-building warehouse complex in Fullerton, Calif. Last week, A&B closed the sale of the Pacific Guardian Center in Honolulu for $38 million. That sale will be included in the fourth-quarter results.

The company, which said last quarter that it was contemplating its future in the sugar industry, saw its losses double in its agribusiness unit to $13.8 million from $6.7 million a year ago due to lower power sales prices and lower sugar margins, while revenue fell 13 percent to $32.5 million from $37.5 million even as sugar production rose 6 percent to 53,700 tons from 50,500 tons due to harvest timing.

Kuriyama said A&B has not yet made a decision regarding the fate of its sugar business and that the long-term future of the business depends on retaining access to water, which is being evaluated in two cases before the state Commission on Water Resource Management.

In the meantime, A&B said its sugar entity, Maui-based Hawaiian Commercial & Sugar Co., should see a recovery next year and that a new favorable agreement has been signed with A&B's primary customer, C&H Sugar Co. A&B said its fourth-quarter loss in sugar this year will be dramatically lower than in the third quarter and that in 2010 A&B could realize as much as a $20 million improvement due to sugar pricing and higher production.