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The expense of spinning off Matson Navigation Co. took a bite out of Alexander & Baldwin Inc.’s earnings last year, but A&B’s remaining real estate and agricultural operations still delivered a profit for the Honolulu-based firm.
A&B reported net income of $20.5 million last year, which was down from $23.5 million the year before.
The company said expenses and other accounting impacts of the Matson separation, which occurred in June, reduced its profit by about $12 million.
In the fourth quarter, A&B reported earning $8.7 million compared with a $3.1 million loss in the same quarter in 2011.
"Overall, I’m pleased with the company’s performance in 2012," Stan Kuriyama, A&B’s chairman and CEO, said in a conference call with stock analysts Tuesday after earnings were reported. "We will build on 2012’s success in the coming year."
Total revenue for A&B rose to $296.7 million last year from $267.7 million the year before.
A&B credited "solid" real estate leasing activity and agriculture operations as driving 2012 income. Tax benefits from a new solar farm on Kauai also helped. But real estate development and sales were a drag on income.
A&B reported $41.6 million in operating income from real estate leasing last year, up from $39.3 million the year before. The company said occupancy at commercial property it owns, including shopping centers, was 92 percent in Hawaii and 93 percent on the mainland last year, or 1 percentage point higher than the year before for each area.
Agricultural operations, mainly Maui sugar plantation Hawaiian Commercial & Sugar Co., produced $20.8 million in operating profit last year, a bit off from $22.2 million the year before. The decrease was due to a decline in production last year, which raised the cost to deliver sugar for sale.
Real estate development generated a $4.4 million operating loss last year compared with a $15.5 million operating profit a year earlier. The loss was primarily due to the value of two California development projects and a joint venture.
A&B said development project sales in Hawaii last year included eight sales at its Kukui‘ula residential resort community on Kauai and eight residential sales at Ka Milo at Mauna Lani on Hawaii island.
Chris Benjamin, A&B’s president and chief operating officer, said the sales reflect a rebound for neighbor island resort homes particularly toward the end of last year, and that sales are expected to increase this year.
A&B also is involved with two condominium high-rise projects on Oahu with pending sales, and plans a third condo tower. But revenue from those projects won’t be recognized until construction is finished.
Shares of A&B stock closed Tuesday at $35.20 before the company announced earnings. Tuesday’s stock price compares with $25.17 on June 29 when the split with Matson occurred, and is near a post-split high of $35.41 on Feb. 6.
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