Key Points - Matson, Inc. (MATX) announced a 5.9% increase in its quarterly cash dividend, raising it to 36 cents per share from 34 cents, effective September 4, 2025 [1][9] - This marks the thirteenth consecutive annual increase in Matson's quarterly dividend, reflecting the company's strong business performance and confidence in long-term free cash flow growth [2][4] - In Q1 2025, Matson returned $78.2 million to shareholders through dividends and share repurchases, with $11.3 million in dividends and $66.9 million in share buybacks [2][9] - The company has consistently rewarded shareholders, with dividends totaling $44.8 million in 2024, $45 million in 2023, and $48 million in 2022, alongside significant share repurchase activities [2] - Dividend-paying stocks like MATX are considered safer investments, providing a steady income stream and acting as a hedge against economic uncertainty [3] - Other companies in the transportation sector, such as Delta Air Lines and FedEx, have also announced dividend hikes in 2025, indicating a broader trend of returning capital to shareholders [5][6][7]

Company Overview - Matson, Inc. is a leading provider of ocean transportation and logistics services, founded in 1882 [3] - The company offers vital ocean freight transportation services to Hawaii, Alaska, Guam, and other Micronesian islands, as well as expedited services from China to Long Beach, California [3] - Matson's fleet includes containerships, combination container and roll-on/roll-off ships, and barges, with logistics services extending throughout North America and Asia [3] Dividend Announcement - The Board of Directors has declared a third quarter dividend of $0.36 per common share, marking a 5.9% increase from the previous quarter [1] - This increase represents the thirteenth consecutive annual increase to Matson's quarterly dividend, reflecting the strength of the business and confidence in long-term free cash flow growth [2] Capital Allocation Strategy - The company emphasizes a disciplined approach to capital allocation, committing to return excess capital to shareholders through share repurchases after funding dividends and supporting operations [2] - Matson aims to maintain an investment-grade balance sheet while investing in growth opportunities [2]

Part I: Financial Information [Financial Statements (Unaudited)](index=4&type=section&id=Item%201.%20Financial%20Statements%20(Unaudited)) The company's Q1 2025 results show significant growth in net income and operating income, alongside robust cash flow and continued capital investment [Income Statement Highlights](index=4&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income%20and%20Comprehensive%20Income) Q1 2025 saw substantial increases in revenue, operating income, and net income compared to the prior year **Q1 2025 vs Q1 2024 Income Statement (in millions, except per share)** | Metric | Q1 2025 | Q1 2024 | Change (%) | | :--- | :--- | :--- | :--- | | **Total Operating Revenue** | $782.0 | $722.1 | +8.3% | | Ocean Transportation Revenue | $637.4 | $579.0 | +10.1% | | Logistics Revenue | $144.6 | $143.1 | +1.0% | | **Operating Income** | $82.1 | $36.9 | +122.5% | | **Net Income** | $72.3 | $36.1 | +100.3% | | **Diluted EPS** | $2.18 | $1.04 | +109.6% | [Balance Sheet Highlights](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) The balance sheet reflects stable total assets and a significant decrease in cash due to vessel investments and share repurchases **Balance Sheet Position (in millions)** | Metric | March 31, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Cash and cash equivalents | $122.0 | $266.8 | | Total Assets | $4,527.0 | $4,595.4 | | Total Liabilities | $1,893.8 | $1,943.4 | | Total Shareholders' Equity | $2,633.2 | $2,652.0 | - The company's cash and cash equivalents decreased significantly from **$266.8 million** at year-end 2024 to **$122.0 million** at the end of Q1 2025, primarily due to investments in new vessels and share repurchases[11](index=11&type=chunk)[13](index=13&type=chunk) [Cash Flow Highlights](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Operating cash flow increased significantly, while investing and financing activities led to a net decrease in cash **Q1 2025 vs Q1 2024 Cash Flows (in millions)** | Cash Flow Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $89.0 | $36.6 | | Net cash used in investing activities | $(129.4) | $(59.0) | | Net cash used in financing activities | $(104.4) | $(85.7) | | **Net Decrease in Cash** | **$(144.8)** | **$(108.1)** | - Investing activities included **$66.7 million** for vessel construction and a net deposit of **$40.4 million** into the Capital Construction Fund (CCF)[13](index=13&type=chunk) - Financing activities included **$66.9 million** for share repurchases and **$11.3 million** in dividends[13](index=13&type=chunk) [Key Notes to Financial Statements](index=9&type=section&id=Notes%20to%20the%20Condensed%20Consolidated%20Financial%20Statements) Notes detail segment performance, joint venture income, vessel construction progress, and share repurchase activities - The company consists of two reportable segments: **Ocean Transportation**, which provides ocean freight services, and **Logistics**, which offers multimodal transportation brokerage, freight forwarding, and warehousing[16](index=16&type=chunk)[17](index=17&type=chunk)[19](index=19&type=chunk) **Segment Revenue Breakdown Q1 2025 (in millions)** | Segment | Revenue | YoY Change | | :--- | :--- | :--- | | Ocean Transportation | $637.4 | +10.1% | | Logistics | $144.6 | +1.0% | - The company's investment in the SSAT joint venture contributed income of **$6.6 million** in Q1 2025, a significant increase from $0.4 million in Q1 2024[41](index=41&type=chunk)[43](index=43&type=chunk) - During Q1 2025, the company repurchased approximately **0.5 million shares for $69.2 million** and paid a quarterly dividend of $0.34 per share[29](index=29&type=chunk)[30](index=30&type=chunk) [Management's Discussion and Analysis (MD&A)](index=29&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses strong Q1 2025 results driven by China freight rates but presents a cautious outlook for the full year [Outlook for 2025](index=29&type=section&id=First%20Quarter%202025%20Discussion%20and%20Outlook%20for%202025) The company projects lower full-year operating income for its core segments and plans significant capital expenditures for new vessels - **Ocean Transportation:** Full-year 2025 operating income is expected to be **lower than 2024**, with China service volume and freight rates projected to decline year-over-year[76](index=76&type=chunk)[78](index=78&type=chunk)[80](index=80&type=chunk)[82](index=82&type=chunk) - **Logistics:** Full-year 2025 operating income is expected to be **lower than the prior year** due to a challenging environment for all business lines[83](index=83&type=chunk) - **SSAT Joint Venture:** The contribution from SSAT is expected to be **lower in 2025** compared to 2024 (excluding a 2024 impairment charge)[81](index=81&type=chunk) **Full Year 2025 Financial Projections** | Metric | Projected 2025 Value | | :--- | :--- | | Depreciation & Amortization | ~$200 million | | Interest Income | ~$31 million | | Interest Expense | ~$7 million | | Effective Tax Rate | ~23.0% | | New Vessel Construction Capex | ~$305 million | | Maintenance & Other Capex | $100 - $120 million | [Segment Performance Analysis (Q1 2025 vs Q1 2024)](index=34&type=section&id=ANALYSIS%20OF%20OPERATING%20REVENUE%20AND%20INCOME%20BY%20SEGMENT) Ocean Transportation income surged due to higher freight rates, while Logistics income saw a slight decline - **Ocean Transportation** operating income increased **166.7% to $73.6 million**, primarily due to significantly higher freight rates in China and a higher contribution from SSAT[94](index=94&type=chunk)[97](index=97&type=chunk) **Ocean Transportation Volume (FEU) - Q1 2025 vs Q1 2024** | Trade Lane | Q1 2025 FEU | Q1 2024 FEU | Change (%) | | :--- | :--- | :--- | :--- | | Hawaii | 35,700 | 34,600 | +3.2% | | Alaska | 19,700 | 18,800 | +4.8% | | China | 28,500 | 28,900 | -1.4% | | Guam | 4,200 | 4,900 | -14.3% | - **Logistics** operating income decreased **8.6% to $8.5 million**, due to lower contributions from freight forwarding and transportation brokerage[99](index=99&type=chunk)[100](index=100&type=chunk) [Liquidity and Capital Resources](index=36&type=section&id=LIQUIDITY%20AND%20CAPITAL%20RESOURCES) The company maintains strong liquidity with significant borrowing capacity despite a working capital deficit and large future capital commitments - Net cash from operations increased to **$89.0 million** in Q1 2025 from $36.6 million in Q1 2024, driven by higher net income and favorable changes in working capital[102](index=102&type=chunk)[103](index=103&type=chunk) - The company had a working capital deficit of **$78.4 million** at quarter-end, a decrease from a surplus of $49.2 million at year-end 2024, primarily due to cash deposited into the Capital Construction Fund (CCF)[111](index=111&type=chunk) - As of March 31, 2025, total debt was **$390.8 million**, and the company had **$643.9 million** of available borrowing capacity under its revolving credit facility[109](index=109&type=chunk)[110](index=110&type=chunk) - The company has committed to future milestone payments of **$749.1 million** for the construction of three new Aloha Class containerships, with payments extending through 2028[113](index=113&type=chunk) Part II: Other Information [Risk Factors](index=44&type=section&id=Item%201A.%20Risk%20Factors) The company faces material risks from potential Jones Act changes, operational challenges, and evolving climate regulations - **Jones Act:** The business would be adversely affected by the repeal, invalidation, or substantial amendment of the Jones Act, which regulates U.S. domestic maritime commerce[130](index=130&type=chunk) - **Operational Risks:** The company is exposed to risks from macroeconomic conditions (inflation, interest rates), geopolitical developments (tariffs, trade tensions), intense competition, and reliance on key third-party vendors for essential services[133](index=133&type=chunk)[135](index=135&type=chunk)[138](index=138&type=chunk) - **Fleet & Fuel Risks:** The company faces risks from fuel price volatility, the uncertain availability and cost of alternative fuels like LNG, and potential delays or cost overruns in its new vessel construction program[139](index=139&type=chunk)[144](index=144&type=chunk)[146](index=146&type=chunk) - **Climate & Sustainability Risks:** Evolving regulations and stakeholder expectations regarding sustainability and climate change (e.g., GHG emissions targets) expose the company to increased costs, operational challenges, and reputational risk[141](index=141&type=chunk)[155](index=155&type=chunk) - **Labor and IT Risks:** A significant portion of the workforce is unionized, making the company susceptible to work stoppages, and it faces significant cybersecurity risks[172](index=172&type=chunk)[180](index=180&type=chunk) [Share Repurchases](index=66&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company actively repurchased shares in Q1 2025 and has significant capacity remaining under its authorized program **Q1 2025 Share Repurchases** | Period | Shares Purchased | Average Price Paid | | :--- | :--- | :--- | | Jan 2025 | 180,000 | $139.12 | | Feb 2025 | 162,505 | $141.22 | | Mar 2025 | 157,066 | $132.21 | | **Total** | **499,571** | **$137.63** | - The Board of Directors approved the addition of **3.0 million shares** to the repurchase program on February 27, 2025, which expires on December 31, 2027[197](index=197&type=chunk)

Core Viewpoint - Matson's quarterly earnings of $2.18 per share fell short of the Zacks Consensus Estimate of $2.34 per share, representing a year-over-year increase from $1.04 per share, with an earnings surprise of -6.84% [1][2] Financial Performance - The company reported revenues of $782 million for the quarter ended March 2025, missing the Zacks Consensus Estimate by 1.24%, compared to $722.1 million in the same quarter last year [2] - Over the last four quarters, Matson has surpassed consensus EPS estimates three times, but has only topped consensus revenue estimates once [2] Stock Performance - Matson shares have declined approximately 16.1% since the beginning of the year, while the S&P 500 has decreased by -3.3% [3] - The current Zacks Rank for Matson is 3 (Hold), indicating expected performance in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $3.18 on revenues of $878.25 million, and for the current fiscal year, it is $11.41 on revenues of $3.4 billion [7] - The trend of estimate revisions for Matson is mixed, which could change following the recent earnings report [6] Industry Context - The Transportation - Services industry, to which Matson belongs, is currently ranked in the bottom 22% of over 250 Zacks industries, indicating potential challenges ahead [8]

Financial Data and Key Metrics Changes - The first quarter consolidated operating income increased by $45.2 million year over year to $82.1 million, driven primarily by higher freight rates in China [19][20] - Net income rose by 100.3% year over year to $72.3 million, with diluted earnings per share increasing by 109.6% to $2.18 [20] - Interest income for the quarter was $9.4 million, up $600,000 from the previous year, while interest expense decreased by $500,000 due to a decline in outstanding debt [20] Business Line Data and Key Metrics Changes - In logistics, operating income decreased by $800,000 year over year to $8.5 million, primarily due to lower contributions from freight forwarding and transportation brokerage [18][19] - The contribution from the SSA terminal joint venture decreased by $6.2 million year over year to $6.6 million, with expectations for 2025 to be lower than the previous year's $17.4 million [16][18] Market Data and Key Metrics Changes - Hawaii container volume increased by 3.2% year over year, while Guam's container volume decreased by 14.3% due to lower demand from retail and food segments [6][16] - Alaska's container volume increased by 4.8% year over year, supported by higher northbound volume [17] Company Strategy and Development Direction - The company is lowering its 2025 outlook due to uncertainties regarding tariffs, global trade, and the US economy [6][9] - A new direct service connecting Ho Chi Minh to Shanghai was announced, reflecting the company's strategy to adapt to changing customer needs and diversify manufacturing locations [10][11] - The company aims to maintain its competitive advantages by focusing on speed, on-time arrivals, and customer service during periods of uncertainty [12][13] Management's Comments on Operating Environment and Future Outlook - Management expressed concerns about the significant uncertainty in tariffs and global trade, expecting container volume and average freight rates to be lower year over year in 2025 [9][23] - The company remains confident in its long-term prospects due to diversification and strong cash flows, despite current market disruptions [27][28] Other Important Information - The company expects to continue returning capital to shareholders through dividends and share repurchase programs [28] - Total debt at the end of the first quarter was $390.8 million, a reduction of $10.1 million from the previous quarter [22] Q&A Session Summary Question: How much capacity is available in Vietnam? - Approximately 20% of current volumes originate from Vietnam, with the ability to increase that volume significantly as needed [33][34] Question: What are the impacts of the 30% decline in China volumes? - The 30% decline is a year-over-year phenomenon, and the impact on operating income can be contextualized by looking at last year's second quarter numbers [74] Question: Will the company consider canceling some MAX sailings? - The company aims to avoid blank sailings, believing that cargo will need to move urgently as inventory runs low [47][49] Question: Is there potential for market share gain from airfreight due to the de minimis exemption changes? - The removal of the de minimis exemption is expected to increase ocean market share as e-commerce shifts from airfreight to ocean freight [56][57] Question: What measures are being taken to mitigate the impact of current market conditions? - The company has implemented a headcount freeze and is deferring capital spending while retaining the ability to recover quickly when conditions improve [70][72]

Matson (MATX) Q1 2025 Earnings Call May 05, 2025 04:30 PM ET Speaker0 you for standing by and welcome to Matson's First Quarter twenty twenty five Financial Results Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. As a reminder, today's program is being recorded. And now I'd like to introduce your host for today's program, Justin Schoenberg, Investor Relations and Corporate Development at Matson. Please ...

[Q1 2025 Financial & Operational Highlights](index=1&type=section&id=MATSON%2C%20INC.%20ANNOUNCES%20FIRST%20QUARTER%202025%20RESULTS) The company reported significant year-over-year increases in net income, diluted EPS, consolidated revenue, operating income, and EBITDA for Q1 2025, alongside share repurchases Financial Performance Overview | Financial Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Net Income | $72.3 million | $36.1 million | | Diluted EPS | $2.18 | $1.04 | | Consolidated Revenue | $782.0 million | $722.1 million | | Consolidated Operating Income | $82.1 million | $36.9 million | | EBITDA | $131.7 million | $82.8 million | - The company repurchased approximately **0.5 million shares** during the first quarter of 2025[3](index=3&type=chunk) [Management Commentary & Outlook](index=1&type=section&id=Management%20Commentary%20%26%20Outlook) Management attributes strong Q1 performance to China service but anticipates significant uncertainty and lower operating income for Q2 and full-year 2025 across both Ocean Transportation and Logistics segments [CEO's Performance Review](index=1&type=section&id=CEO%27s%20Performance%20Review) The CEO attributed strong Q1 operating income to the China service, with mixed domestic tradelane volumes and lower Logistics segment performance - The primary driver for the strong Q1 performance was the China service, which benefited from elevated freight rates from Q4 2024 and healthy demand after the Lunar New Year[2](index=2&type=chunk) - Domestic tradelane volumes were higher year-over-year in Hawaii and Alaska, but lower in Guam[2](index=2&type=chunk) - Logistics operating income declined year-over-year, mainly due to reduced contributions from freight forwarding and transportation brokerage[2](index=2&type=chunk) [Business Outlook](index=1&type=section&id=Business%20Outlook) Management anticipates significant uncertainty from tariffs and global trade, projecting lower Q2 and full-year operating income for both Ocean Transportation and Logistics segments - The company faces significant uncertainty from potential tariffs, global trade dynamics, regulatory measures, and the U.S. economy's trajectory[2](index=2&type=chunk) - Ocean Transportation operating income for Q2 2025 is expected to be "meaningfully lower" than Q2 2024, with full-year income also projected to be lower than the prior year[2](index=2&type=chunk)[9](index=9&type=chunk) - Logistics operating income is also expected to be lower in Q2 2025 and for the full year compared to the prior year, attributed to a challenging environment across all its business lines[2](index=2&type=chunk)[10](index=10&type=chunk) [Segment Performance & Outlook](index=2&type=section&id=Results%20By%20Segment) Ocean Transportation operating income surged in Q1 due to China service rates, while Logistics declined, with both segments forecasting lower full-year performance amid market uncertainties [Ocean Transportation](index=2&type=section&id=Ocean%20Transportation) Ocean Transportation operating income surged 166.7% in Q1 2025 due to China service rates, but anticipates lower Q2 and full-year income amid declining demand and trade uncertainties Ocean Transportation Performance | Metric (Q1 2025 vs Q1 2024) | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $637.4M | $579.0M | +10.1% | | Operating Income | $73.6M | $27.6M | +166.7% | | **Volume (FEU)** | | | | | Hawaii | 35,700 | 34,600 | +3.2% | | Alaska | 19,700 | 18,800 | +4.8% | | China | 28,500 | 28,900 | -1.4% | | Guam | 4,200 | 4,900 | -14.3% | - The increase in operating income was primarily due to significantly higher freight rates in China and a higher contribution from the SSAT joint venture[18](index=18&type=chunk) - For the full year 2025, Ocean Transportation operating income is expected to be lower than the prior year, with the magnitude dependent on global trade and macroeconomic uncertainties[9](index=9&type=chunk) [Hawaii Service](index=2&type=section&id=Hawaii%20Service) Hawaii service container volume increased 3.2% in Q1 2025 due to a competitor's dry-docking, with full-year volume expected to be comparable to 2024 - Q1 2025 volume increased **3.2% YoY**, primarily due to a competitor's vessel being in dry-dock[4](index=4&type=chunk) - Full-year 2025 volume is expected to be comparable to 2024 levels[4](index=4&type=chunk) [China Service](index=2&type=section&id=China%20Service) China service achieved significantly higher Q1 2025 freight rates, but anticipates lower Q2 and full-year volume and rates due to a 30% April decline post-tariffs - Achieved significantly higher freight rates in Q1 2025 compared to Q1 2024[5](index=5&type=chunk) - Container volume declined approximately **30% year-over-year** in April after tariffs were implemented[5](index=5&type=chunk) - The company expects both container volume and average freight rates to be lower year-over-year for Q2 and the full year 2025[5](index=5&type=chunk) [Guam Service](index=2&type=section&id=Guam%20Service) Guam's container volume decreased 14.3% in Q1 2025 due to lower retail and food/beverage demand, with full-year volume expected to approach 2024 levels - Q1 2025 volume decreased **14.3% YoY** due to lower demand in retail and food/beverage[6](index=6&type=chunk) - Full-year 2025 volume is expected to approach the level achieved in 2024[6](index=6&type=chunk) [Alaska Service](index=2&type=section&id=Alaska%20Service) Alaska's container volume increased 4.8% in Q1 2025 due to higher northbound volume, with full-year volume expected to be comparable to 2024 - Q1 2025 volume increased **4.8% YoY**, mainly from higher northbound volume[7](index=7&type=chunk) - Full-year 2025 volume is expected to be comparable to 2024[7](index=7&type=chunk) [SSAT Joint Venture](index=2&type=section&id=SSAT%20Joint%20Venture) SSAT joint venture contribution increased significantly to $6.6 million in Q1 2025 due to higher lift volume, but is expected to be lower for full-year 2025 - Q1 2025 contribution was **$6.6 million**, a **$6.2 million increase** from Q1 2024, driven by higher lift volume[8](index=8&type=chunk)[19](index=19&type=chunk) - For the full year 2025, the contribution from SSAT is expected to be lower than the **$17.4 million** achieved in 2024[8](index=8&type=chunk) [Logistics](index=2&type=section&id=Logistics) Logistics segment operating income decreased 8.6% in Q1 2025 due to lower freight forwarding and brokerage contributions, with lower Q2 and full-year income anticipated Logistics Performance | Metric (Q1 2025 vs Q1 2024) | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Revenue | $144.6M | $143.1M | +1.0% | | Operating Income | $8.5M | $9.3M | -8.6% | - The decrease in operating income was mainly due to lower contributions from freight forwarding and transportation brokerage, partially offset by a higher contribution from supply chain management[21](index=21&type=chunk) - For the full year 2025, Logistics operating income is expected to be lower than the prior year due to a challenging environment for all business lines[10](index=10&type=chunk) [Full Year 2025 Financial Outlook](index=2&type=section&id=Full%20Year%202025%20Financial%20Outlook) The company projects lower full-year 2025 consolidated operating income due to market uncertainties, providing guidance for key financial metrics and substantial capital expenditures [Consolidated Outlook & Guidance](index=2&type=section&id=Consolidated%20Outlook) Full-year 2025 consolidated operating income is expected to be lower than 2024 due to market uncertainties, with specific guidance provided for depreciation, interest, other income, and effective tax rate - Full-year 2025 consolidated operating income is expected to be lower than the **$551.3 million** achieved in 2024[11](index=11&type=chunk) Full Year 2025 Guidance | Full Year 2025 Guidance | Amount (Approx.) | | :--- | :--- | | Depreciation & Amortization | $200 million | | Interest Income | $31 million | | Interest Expense | $7 million | | Other Income | $9 million | | Effective Tax Rate | 23.0% | [Capital & Dry-docking Expenditures](index=3&type=section&id=Capital%20and%20Vessel%20Dry-docking%20Expenditures) The company made significant Q1 2025 capital investments, projecting substantial full-year expenditures including $305 million for new vessel construction and $100-120 million for other capital needs Capital and Dry-docking Expenditures | Expenditure Type | Q1 2025 Payments | Full Year 2025 Expectation | | :--- | :--- | :--- | | Other Capital Expenditures | $22.5M | $100M - $120M | | New Vessel Construction | $66.7M | ~$305M | | Dry-docking Payments | $10.4M | ~$40M | [Liquidity and Capital Allocation](index=5&type=section&id=Liquidity%2C%20Cash%20Flows%20and%20Capital%20Allocation) The company's cash and cash equivalents decreased in Q1 2025 despite increased operating cash flow, while continuing its capital return program through share repurchases and dividends [Liquidity and Cash Flow](index=5&type=section&id=Liquidity%20and%20Cash%20Flow) Cash and cash equivalents decreased to $122.0 million in Q1 2025, despite net cash from operating activities significantly increasing to $89.0 million, while total debt slightly decreased - Cash and Cash Equivalents decreased by **$144.8 million** during Q1 2025 to **$122.0 million**[22](index=22&type=chunk) - Net cash from operating activities was **$89.0 million** for Q1 2025, compared to **$36.6 million** for Q1 2024[22](index=22&type=chunk) - Total debt decreased by **$10.1 million** to **$390.8 million** as of March 31, 2025[22](index=22&type=chunk) [Capital Return](index=5&type=section&id=Capital%20Return) Matson continued its capital return program in Q1 2025 by repurchasing approximately 0.5 million shares for $69.2 million and declaring a $0.34 per share quarterly cash dividend - Repurchased approximately **0.5 million shares** for a total cost of **$69.2 million** in Q1 2025[23](index=23&type=chunk) - Declared a cash dividend of **$0.34 per share**, payable on June 5, 2025[23](index=23&type=chunk) [Consolidated Financial Statements](index=8&type=section&id=Consolidated%20Financial%20Statements) The consolidated financial statements for Q1 2025 show significant increases in revenue, operating income, and net income, alongside changes in balance sheet items and cash flow activities, with a notable rise in EBITDA [Condensed Consolidated Statements of Income](index=8&type=section&id=Condensed%20Consolidated%20Statements%20of%20Income) Matson reported total operating revenue of $782.0 million in Q1 2025, leading to a significant increase in net income to $72.3 million, or $2.18 per diluted share Condensed Consolidated Statements of Income | (In millions, except per share) | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Operating Revenue | $782.0 | $722.1 | | Operating Income | $82.1 | $36.9 | | Income before Taxes | $92.2 | $45.3 | | **Net Income** | **$72.3** | **$36.1** | | **Diluted Earnings Per Share** | **$2.18** | **$1.04** | [Condensed Consolidated Balance Sheets](index=9&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of March 31, 2025, total assets slightly decreased to $4.53 billion, primarily due to reduced cash and cash equivalents, while total liabilities also decreased and shareholders' equity remained stable Condensed Consolidated Balance Sheets | (In millions) | March 31, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$4,527.0** | **$4,595.4** | | Cash and cash equivalents | $122.0 | $266.8 | | Property and equipment, net | $2,314.0 | $2,260.9 | | Capital Construction Fund | $685.4 | $642.6 | | **Total Liabilities** | **$1,893.8** | **$1,943.4** | | **Total Shareholders' Equity** | **$2,633.2** | **$2,652.0** | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) Net cash from operating activities significantly increased to $89.0 million in Q1 2025, while investing and financing activities led to a net cash decrease of $144.8 million Condensed Consolidated Statements of Cash Flows | (In millions) | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $89.0 | $36.6 | | Net cash used in investing activities | ($129.4) | ($59.0) | | Net cash used in financing activities | ($104.4) | ($85.7) | | **Net Decrease in Cash** | **($144.8)** | **($108.1)** | [Non-GAAP Reconciliation (EBITDA)](index=11&type=section&id=Net%20Income%20to%20EBITDA%20Reconciliations) The company's non-GAAP EBITDA significantly increased to $131.7 million in Q1 2025, up $48.9 million from Q1 2024, reflecting strong underlying operational performance Net Income to EBITDA Reconciliations | (In millions) | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | Net Income | $72.3 | $36.1 | $36.2 | | Adjustments (Taxes, Interest, D&A) | $59.4 | $46.7 | $12.7 | | **EBITDA** | **$131.7** | **$82.8** | **$48.9** |

Q1 2025 Performance - Consolidated operating income significantly increased year-over-year, driven primarily by the China service due to elevated freight rates from Q4 2024 and healthy demand[7] - Hawaii container volume increased by 32% year-over-year due to a competitor's vessel dry-docking[8] - Alaska container volume increased by 48% year-over-year, driven by higher northbound volume[41] - Guam container volume decreased by 143% year-over-year due to lower demand from retail and food and beverage segments[34] - Matson Logistics operating income decreased by approximately $08 million year-over-year to $85 million, due to lower contribution from freight forwarding and transportation brokerage[54] - SSAT joint venture contributed $66 million, a year-over-year increase of $62 million, primarily due to higher lift volume[48] - Net income was $723 million, a 1003% increase compared to $361 million in the first quarter of 2024[55] - Approximately 05 million shares were repurchased for a total cost of $692 million in Q1 2025[61] Outlook - The company is lowering its 2025 outlook due to uncertainty in the market regarding tariffs, global trade, regulatory measures, the U S economy, and geopolitical factors[7] - The company expects full year 2025 container volume in Hawaii to be comparable to the level achieved last year[12] - The company expects full year 2025 container volume in Guam to approach the level achieved last year[35] - The company expects full year 2025 container volume in Alaska to be comparable to the level achieved last year[42] - The company expects the contribution from SSAT to be lower than the $174 million achieved last year, excluding the $184 million impairment charge in Q4 2024[44] - The company expects Logistics operating income to be lower than the level achieved last year due to a challenging environment for all business lines[50] - The company expects approximately $225 million in milestone payments during the balance of 2025 from the Capital Construction Fund (CCF)[69]

Core Insights - Matson, Inc. announced the retirement of Rusty Rolfe, Executive Vice President and President of Matson Logistics, effective July 1, 2025, after 24 years of leadership in transforming Matson Logistics into a recognized provider of integrated logistics services [1][2] - Jerome Holland, currently Vice President of Strategic Planning and Business Development at Matson Logistics, will succeed Rolfe, ensuring a seamless transition [2][3] Company Overview - Matson, founded in 1882, is a leading provider of ocean transportation and logistics services, serving non-contiguous economies such as Hawaii, Alaska, and Guam, as well as other island economies in Micronesia [5] - The company operates a fleet that includes containerships and roll-on/roll-off ships, and Matson Logistics extends its transportation network throughout North America and Asia with asset-light logistics services [5]

Matson (MATX) could be a solid choice for investors given its recent upgrade to a Zacks Rank #2 (Buy). An upward trend in earnings estimates -- one of the most powerful forces impacting stock prices -- has triggered this rating change.The Zacks rating relies solely on a company's changing earnings picture. It tracks EPS estimates for the current and following years from the sell-side analysts covering the stock through a consensus measure -- the Zacks Consensus Estimate.Since a changing earnings picture is ...