Matson’s earnings nearly double

Higher demand for shipping goods to Hawaii helped Matson Inc. almost double its profit in the second quarter, but the gain mostly reflected abnormally low earnings a year earlier.

Hawaii’s largest ocean cargo transportation company announced Tuesday that it earned $18 million in the three months ended June 30, up 82 percent from $9.9 million in the same period last year.

The company said its profit in the 2015 second quarter was reduced by $14.5 million because of two extraordinary events: settling state claims over a 2013 molasses spill at Honolulu Harbor and having higher-than-anticipated expenses tied to purchasing Horizon Lines Inc. operations in Alaska last year.

In the second quarter of 2014, Matson’s profit was nearly identical to the recent quarter: $18.1 million.

“Matson’s core businesses delivered second-quarter operating results in line with our expectations,” Matt Cox, company president and CEO, said in a conference call with stock market analysts.

Core operations for Matson include container shipping between the West Coast and Hawaii, China and Alaska.

Revenue in the second quarter rose 4.5 percent to $467.7 million compared with $447.6 million in the year-ago quarter.

In Hawaii, Matson said its business was up due to modest market growth along with competitive gains made against Pasha Hawaii Transport Lines, which acquired the Hawaii operations of Horizon.

Hawaii container volume for Matson rose 8.4 percent to 37,400 containers in the recent quarter from 34,500 a year earlier. And Hawaii automobile shipments rose 19.1 percent to 21,200 from 17,800.

“Our Hawaii trade produced solid results,” Cox said.

In China the number of containers carried by Matson dropped 9.7 percent — to 13,900 in the recent quarter from 15,400 a year earlier. The company said that was because of overcapacity in the industry and exceptional demand a year ago during West Coast labor disruptions.

“Market conditions in the China trade remained at depressed levels,” Cox said. “The supply growth has grown faster than the demand growth.”

In Alaska, Matson carried about three times as many containers in the April-June period compared with a year earlier, but that was because the year-ago period included only volume from June because the Horizon deal was completed May 31. Compared with 2015 second-quarter container volume carried by Horizon and Matson, volume in the recent quarter was down “moderately” due primarily to low energy prices that are sapping significant economic activity in the big oil-producing state, Cox said.

Matson also serves two other trade lanes, Guam and the South Pacific, where volume is considerably smaller. Guam volume was flat while South Pacific volume was down 13 percent.

Stock market analysts had been expecting that Matson would achieve an $18.2 million profit in the second quarter, just a bit above what the company delivered. Actual profit equated to 42 cents per share of Matson stock.

Shares of Matson stock closed Tuesday at $37.39 before the earnings announcement. In the last 52 weeks, Matson shares have closed between $52.82 on Nov. 6 and $31.03 on May 19.