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Castle & Cooke
net declines
7.1 percent

But a 1998 land transaction
skewed the home builder's
fourth-quarter results

By Russ Lynch
Star-Bulletin

Castle & Cooke Inc. had a fourth-quarter net income of $2.6 million, down 7.1 percent from $2.8 million in the year-earlier quarter and equal to 15 cents a share compared with a year-earlier 16 cents.

The year-over-year comparison was skewed by a single sale of undeveloped property in the 1998 quarter which added about $576,000 to that period's net income. Without it, the latest fourth-quarter net would have been up 17 percent, said the Los Angeles-based home builder and commercial property developer that has its origins in Hawaii.

Revenues for the three months through Dec. 31 1999 were $90.3 million, up 7.1 percent from the 1998 quarter's $84.3 million, which included $1.6 million from the one property sale.

On Oahu, Castle & Cooke turned over 125 new homes to their buyers in the fourth quarter, leaving it with a year-end backlog of only 29 homes sold but not yet delivered. In the last quarter of 1998, the company delivered 129 homes on Oahu and had a backlog of 67 at year-end.

Sales were strong enough in 1999 to reduce inventory to the point where it must start building more units on Oahu, the company said. Castle & Cooke earlier announced a plan to spend about $100 million this year to develop more homes at Mililani and Kunia. The average price per Oahu unit delivered in the 1999 quarter was $273,000, down 5.9 percent from a $290,000 average in the year-earlier period.

David H. Murdock, chairman and chief executive officer, said Castle & Cooke is cautiously optimistic about Hawaii's economic activity.

On Lanai, the company had a $1.6 million fourth-quarter operating loss from its resort operations, compared with a loss of $2.4 million in the 1998 period. Sales of luxury homes and lots on Lanai brought an operating profit of $686,000 in the latest quarter, compared with an operating loss of $954,000 in the year-earlier quarter.

Mainland home deliveries and orders for new homes were up substantially, the company said. Sales of mainland homesites were down a little.

For all of 1999 in all of its businesses, Castle & Cooke had a net profit of $13.5 million, up 25 percent from $10.8 million in 1998, and equal to 79 cents a share compared with 1998's 58 cents. Total revenues for 1999 were $316.9 million, up 9.2 percent from $290.2 million in 1998.

Castle & Cooke's shares closed unchanged at $12.06 today in trading on the New York Stock Exchange.