- Expects 1Q23 operating income for Ocean Transportation to be
$23.0 to $28.0 million
- Expects 1Q23 operating income for Logistics to be $10.0 to $11.0 million
- Expects 1Q23 net income and diluted EPS to be $29.3 to $33.8 million and $0.81 to $0.93,
respectively
- Year-over-year decrease in consolidated operating income driven
primarily by lower contribution from China service
- Repurchased approximately 0.7 million shares in 1Q23
- Announces first quarter earnings call date on May 4,
2023
HONOLULU, April 19,
2023 /PRNewswire/ -- Matson, Inc. ("Matson" or the
"Company") (NYSE: MATX) today announces preliminary first quarter
financial results, provides a business update and announces that
its first quarter earnings call will be held on May 4,
2023.
![Matson Logo. (PRNewsFoto/Matson) Matson Logo. (PRNewsFoto/Matson)](https://mma.prnewswire.com/media/128194/matson_logo.jpg)
"Despite being down from the extraordinary pandemic driven
demand level over the last two years, Matson's Ocean Transportation
and Logistics business segments performed well in a challenging
business environment," said Chairman and Chief Executive Officer
Matt Cox. "Within Ocean
Transportation, our China service
generated lower year-over-year volume and freight rates, which were
the primary contributors to the year-over-year decline in our
consolidated operating income. During the first quarter,
retail customers continued to conservatively manage inventories
amid weakening consumer demand, increasing interest rates and
economic uncertainty. Currently in the Transpacific
marketplace, business conditions are mixed with general improvement
in tradelane capacity and some improvement in retailer inventories,
but we continue to see conservative management of inventories by
retail customers in light of economic uncertainty. As such,
we expect our CLX and CLX+ services in the second quarter to
reflect freight demand levels below normalized conditions with
lower year-over-year volumes and rates. Absent an economic
'hard landing' in the U.S., we continue to expect improved trade
dynamics in the second half of 2023 as the Transpacific marketplace
transitions to a more normalized level of demand. Regardless
of the economic environment, we expect to continue to earn a
significant rate premium to the Shanghai Containerized Freight
Index reflecting our fast and reliable ocean services and unmatched
destination services."
Mr. Cox added, "In our domestic ocean tradelanes, we saw lower
year-over-year volumes in Hawaii,
Alaska and Guam compared to the year ago period.
The modest year-over-year decline in Hawaii volume was primarily due to lower
eastbound volume. The year-over-year volume declines in
Guam and Alaska were primarily driven by lower
retail-related demand and lower seafood volume, respectively.
In Logistics, operating income decreased year-over-year primarily
due to lower contributions from supply chain management and
transportation brokerage. As a result, Matson expects first
quarter operating income for Ocean Transportation of $23.0 to $28.0 million and Logistics operating income
of $10.0 to $11.0 million. We also expect first
quarter 2023 net income and diluted EPS to be $29.3 to $33.8 million and $0.81 to $0.93,
respectively."
First Quarter Tradelane Volume (Forty-foot equivalent units
(FEU)) (1)(2):
For the three months ended March 31, 2023 compared to the
three months ended March 31, 2022 and on a FEU
basis:
- Hawaii container volume
decreased 0.8 percent primarily due to lower eastbound volume;
- Alaska volume decreased 4.8
percent due to (i) lower export seafood volume from the Alaska-Asia
Express service ("AAX") primarily due to three less sailings and
(ii) lower southbound volume primarily due to lower domestic
seafood and household goods volume, partially offset by higher
northbound volume primarily due to two additional sailings;
- China volume was 35.4 percent
lower primarily due to (i) CCX volume in 1Q22 (CCX service was
discontinued in 3Q22) and (ii) lower demand for the CLX and CLX+
services;
- Guam volume was 10.9 percent
lower primarily due to lower retail-related demand; and
- Other containers volume decreased 22.6 percent.
__________
(1) Approximate volumes included for the period
are based on the voyage departure date, but revenue and operating
income are adjusted to reflect the percentage of revenue and
operating income earned during the reporting period for voyages in
transit at the end of each reporting period.
(2) Other containers includes containers from
services in various islands in Micronesia and the South Pacific, and
Okinawa, Japan.
Liquidity, Debt and Share Repurchases
Matson's cash and cash equivalents as of March 31, 2023 was
approximately $88.0 million, which
excludes $623.7 million in cash
on deposit within the Capital Construction Fund. Total debt
as of March 31, 2023 was $476.7
million.(3) During the first quarter
of 2023, Matson prepaid approximately $26.4 million of outstanding principal on
the 5.34% Title XI debt payable through 2028 and the 5.27% Title XI
debt payable through 2029, which represented all of the remaining
principal amount outstanding for both debt instruments.
During the first quarter of 2023, Matson repurchased
approximately 0.7 million shares for a total cost of
$41.8 million. As of
March 31, 2023, the Company had approximately 0.9 million
shares remaining in its share repurchase program.
A slide presentation that accompanies this press release is
available on the Company's website at www.matson.com, under
Investors.
(3) Total debt is presented before any reduction for
deferred loan fees as required by GAAP.
Teleconference and Webcast
A conference call is scheduled on May 4, 2023 at
4:30 p.m. ET when Matt Cox, Chairman and Chief Executive Officer,
and Joel Wine, Executive Vice
President and Chief Financial Officer, will discuss Matson's first
quarter results.
|
|
Date of Conference
Call:
|
Thursday, May 4,
2023
|
Scheduled
Time:
|
4:30 p.m. ET / 1:30
p.m. PT / 10:30 a.m. HT
|
The conference call will be broadcast live along with an
additional slide presentation on the Company's website at
www.matson.com, under Investors.
Participants may register for the conference call at:
https://register.vevent.com/register/BIf4c1f30d251f4af5aad4bf7307788646
Registered participants will receive the conference call dial-in
number and a unique PIN code to access the live event. While
not required, it is recommended you join 10 minutes prior to the
event starting time. A replay of the conference call will be
available approximately two hours after the event by accessing the
webcast link at www.matson.com, under Investors.
About the Company
Founded in 1882, Matson (NYSE: MATX) is a leading provider of
ocean transportation and logistics services. Matson provides
a vital lifeline of ocean freight transportation services to the
domestic non-contiguous economies of Hawaii, Alaska, and Guam, and to other island economies in
Micronesia. Matson also operates premium, expedited services
from China to Long Beach, California, provides service to
Okinawa, Japan and various islands
in the South Pacific, and operates an international export service
from Dutch Harbor to Asia.
The Company's fleet of owned and chartered vessels includes
containerships, combination container and roll-on/roll-off ships
and custom-designed barges. Matson Logistics, established in
1987, extends the geographic reach of Matson's transportation
network throughout North America
and Asia. Its integrated, asset-light logistics services
include rail intermodal, highway brokerage, warehousing, freight
consolidation, supply chain management, and freight forwarding to
Alaska. Additional information about the Company is available
at www.matson.com.
Forward-Looking Statements
Statements in this news release that are not historical facts
are "forward-looking statements," within the meaning of the Private
Securities Litigation Reform Act of 1995, including without
limitation those statements regarding performance and financial
results; volume, rate and freight demand levels; retailer
inventories; tradelane capacity; economic uncertainty; trade
dynamics; business conditions in the Transpacific marketplace; and
Matson's rate premium to the Shanghai Containerized Freight
Index. These statements involve a number of risks and
uncertainties that could cause actual results to differ materially
from those contemplated by the relevant forward-looking statement,
including but not limited to risks and uncertainties relating to
repeal, substantial amendment or waiver of the Jones Act or its
application, or our failure to maintain our status as a
United States citizen under the
Jones Act; changes in macroeconomic conditions, geopolitical
developments, or governmental policies, including from the COVID-19
pandemic; our ability to offer a differentiated service in
China for which customers are
willing to pay a significant premium; new or increased competition
or improvements in competitors' service levels; our relationship
with customers, agents, vendors and partners and changes in related
agreements; fuel prices, our ability to collect fuel-related
surcharges and/or the cost or limited availability of required
fuels; evolving stakeholder expectations related to environmental,
social and governance matters; timely or successful completion of
fleet upgrade initiatives; the ability of Philly Shipyard to
construct and deliver the new Aloha Class vessels on the
contemplated timeframe; the occurrence of poor weather, natural
disasters, maritime accidents, spill events and other physical and
operating risks, including those arising from climate change;
transitional and other risks arising from climate change; the
magnitude and timing of the impact of public health crises,
including COVID-19; significant operating agreements and leases
that may not be replaced on favorable terms; any unanticipated
dry-dock or repair expenses; joint venture relationships;
conducting business in foreign shipping markets, including the
imposition of tariffs or a change in international trade policies;
any delays or cost overruns related to the modernization of
terminals; war, terrorist attacks or other acts of violence;
consummating and integrating acquisitions; relations with our
unions; satisfactory negotiation and renewal of expired collective
bargaining agreements without significant disruption to Matson's
operations; loss of key personnel or failure to adequately manage
human capital; the use of our information technology and
communication systems and cybersecurity attacks; changes in our
credit profile and our future financial performance; our ability to
obtain future debt financings; continuation of the Title XI and CCF
programs; costs to comply with and liability related to numerous
safety, environmental, and other laws and regulations; and
disputes, legal and other proceedings and government inquiries or
investigations. These forward-looking statements are not
guarantees of future performance. This release should be read
in conjunction with our Annual Report on Form 10-K for the year
ended December 31, 2022 and our other
filings with the SEC through the date of this release, which
identify important factors that could affect the forward-looking
statements in this release. We do not undertake any
obligation to update our forward-looking statements.
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SOURCE Matson, Inc.