Matson Sees FY24 Ocean Transportation Operating Income To Be Higher Than $294.8M Achieved In 2023 And Higher Then Previous Outlook

As a result of first quarter performance and the outlook trends noted above, the Company expects full year 2024 Ocean Transportation operating income to be higher than the $294.8 million achieved in 2023 and higher than the previous outlook.  In the second quarter 2024, the Company expects Ocean Transportation operating income to be moderately higher than the level achieved in the second quarter 2023.

Logistics:  In the first quarter 2024, operating income for the Company's Logistics segment was $9.3 million, or $1.6 million lower compared to the level achieved in the first quarter 2023.  The decrease was primarily due to continued market softness in transportation brokerage.  For 2024, the Company expects challenging business conditions for transportation brokerage and expects operating income to be lower than the $48.0 million achieved in 2023.  In the second quarter 2024, the Company expects operating income to be lower than the level achieved in the second quarter 2023.

Consolidated Operating Income:  For full year 2024, the Company expects consolidated operating income to be modestly higher than the $342.8 million achieved in 2023 and expects comparable seasonality to the prior year.  For the second quarter 2024, the Company expects consolidated operating income to be modestly higher than the $96.7 million achieved in the second quarter 2023.

Depreciation and Amortization:  For the full year 2024, the Company expects depreciation and amortization expense to be approximately $180 million, inclusive of dry-docking amortization of approximately $27 million.

Interest Income:  The Company expects interest income for the full year 2024 to be approximately $45 million.  The increase in expected interest income from the prior outlook is due to the receipt on April 19, 2024 of $10.2 million in interest income earned on the federal tax refund related to the Company's 2021 federal tax return. 

Interest Expense:  The Company expects interest expense for the full year 2024 to be approximately $8 million.

Other Income (Expense):  The Company expects full year 2024 other income (expense) to be approximately $7 million in income, which is attributable to the amortization of certain components of net periodic benefit costs or gains related to the Company's pension and post-retirement plans.

Income Taxes:  In the first quarter 2024, the Company's effective tax rate was 20.3 percent.  For the full year 2024, the Company expects its effective tax rate to be approximately 22.0 percent.

Capital and Vessel Dry-docking Expenditures:  For the first quarter 2024, the Company made capital expenditure payments excluding vessel construction expenditures of $54.2 million, capitalized vessel construction expenditures of $1.1 million, and dry-docking payments of $5.2 million.  For the full year 2024, the Company expects to make other capital expenditure payments, including maintenance capital expenditures, of approximately $110 to $120 million, new vessel construction expenditures (including capitalized interest and owner's items) of approximately $75 million, LNG installations and reengining on existing vessels of approximately $70 to $80 million, and dry-docking payments of approximately $35 million.