HONOLULU--(BUSINESS WIRE)--Mar. 20, 2009-- Alexander & Baldwin, Inc. (NYSE: AXB)(“Company”), today announced that it expects first quarter 2009 performance to be negatively impacted by increased weakness in its transportation segments and by workforce reduction restructuring costs. Net income is expected to approximate break-even in the quarter, and is expected to include two commercial property sales currently in escrow and a workforce restructuring charge of $5-6 million. These results may be further impacted by market conditions and the timing of the aforementioned property sales.
“Our early year earnings prospects were diminished by continued national and international economic contraction and seasonality in our transportation businesses,” said Allen Doane, chairman and chief executive officer. “Historically, our first quarter results are lower than performance later in the year due to normal transportation patterns. Through the first two months of the year, however, cargo demand and freight movement have been lower than expected. Matson Navigation’s eastbound volume from China and westbound volume to Hawaii, for example, are off 20 and 12 percent, respectively, from 2008 levels. In addition, the Company’s Logistics volume is down 24 percent through February, as its intermodal volume has dropped significantly, driven by lower import and export activity and related inland rail movements.”
Doane continued, “While we do continue to see opportunities for commercial properties and land sales, we note that the timing of these sales will be irregular.”
“In anticipation of these earnings challenges, we took deliberate steps to strengthen our cost and capital structure. We are reducing our non-union workforce by approximately 10 percent, which is expected to save about $8 million annually. We have pared $50 million from our 2009 capital budget of $325 million. We renewed a long-term debt facility to better match financing to the investments we make in long-lived assets. And later this month we will shift to a 9-ship fleet deployment in our ocean services segment for additional efficiencies. Other cost reduction initiatives will be implemented throughout the year to improve earnings, while we maintain our strong balance sheet and cash flows to pursue acquisitions and investments that create sustained value in future years.”
The Company will report its first quarter 2009 earnings on April 30, 2009 and will host a webcast to discuss results on May 1, 2009.
About Alexander & Baldwin: A&B is headquartered in Honolulu, Hawaii and is engaged in ocean transportation and logistics services through its subsidiaries, Matson Navigation Company, Inc., Matson Integrated Logistics, Inc. and Matson Global Distribution Services; in real estate through A&B Properties, Inc.; and in food products through Hawaiian Commercial & Sugar Company and Kauai Coffee Company, Inc. Additional information about A&B may be found at its web site: www.alexanderbaldwin.com.
Statements in this press release that are not historical facts are “forward-looking statements,” within the meaning of the Private Securities Litigation Reform Act of 1995, that involve a number of risks and uncertainties that could cause actual results to differ materially from those contemplated by the relevant forward-looking statement. 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 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.
Source: Alexander & Baldwin, Inc.
Alexander & Baldwin, Inc.
Meredith J. Ching, 808-525-6669 (Media)
Kevin L. Halloran, 808-525-8422 (Investor Relations)