Financial Data and Key Metrics Changes - The second quarter consolidated operating income decreased by $11.6 million year over year to $113 million, primarily due to lower contributions from ocean transportation and logistics [18] - Net income decreased by 16.3% year over year to $94.7 million, and diluted earnings per share decreased by 11.8% year over year to $2.92 per share [19] - Interest income for the quarter was $8 million compared to $18.8 million in the same period last year, reflecting a significant decline [19] Business Line Data and Key Metrics Changes - In Ocean Transportation, operating income was lower year over year primarily due to lower volume in the China service, despite higher freight rates [5] - Logistics operating income in the second quarter was $14.4 million, which is $1.2 million lower than the previous year, mainly due to a lower contribution from transportation brokerage [16] - Container volume in Hawaii increased by 2.6% year over year, while in Guam, it decreased by 2.2%, and in Alaska, it increased by 0.9% year over year [7][14][15] Market Data and Key Metrics Changes - Container volume in the China service decreased by 14.6% year over year due to market uncertainty and tariff impacts [8] - Transshipment volume from outside China represented approximately 21% of the China service, up from 13% in the first quarter, indicating a shift in sourcing [12] - The Hawaii economy remains stable, supported by strong construction activity, but faces potential headwinds from slowing tourism and high inflation [8] Company Strategy and Development Direction - The company is focused on maintaining its position in the Transpacific trade lanes and supporting customers as they diversify their manufacturing bases [26] - There is an emphasis on expanding transshipment capabilities and ensuring fast and reliable services from various origins, particularly in Southeast Asia [46] - The company plans to continue returning excess capital to shareholders in the absence of large growth investment opportunities [21] Management's Comments on Operating Environment and Future Outlook - Management expects continued uncertainty regarding tariffs, global trade, and the U.S. economy, but is raising its outlook for the full year 2025 based on second-quarter performance [6] - The company anticipates lower year-over-year freight rates and volume in the third quarter, reflecting a muted peak season [13] - Management believes that while there will be a long-term shift away from China, it will remain a significant manufacturing hub [65] Other Important Information - The company repurchased approximately 900,000 shares for a total cost of $93.7 million during the second quarter [21] - Total debt at the end of the second quarter was $381 million, a reduction of $9.8 million from the previous quarter [21] - The company entered into a new five-year revolving credit facility with commitments aggregating $550 million [21] Q&A Session Summary Question: Expectations for lower volumes in Q3 - Management noted that lower volumes are influenced by extra sailings last year and customers holding back shipments due to inventory levels [31][32] Question: Impact of new expedited services - Management acknowledged the presence of new expedited services but emphasized their focus on maintaining their competitive edge in speed and reliability [34][35] Question: Outlook for the back half of the year - Management expects a more muted peak season compared to previous years, with a strong Q3 followed by a typical fall-off in October [37] Question: Developments in Southeast Asia - Management is focused on understanding customer needs and ensuring fast, reliable services from new origins as production shifts away from China [45][46] Question: Financial outlook for the back half of the year - Management confirmed that cost reduction actions taken earlier in the year would continue, contributing to improved operating margins [50]

Financial Performance - Ocean Transportation revenue for the second quarter of 2025 decreased by 2.1% year-over-year to $675.6 million[49] - Logistics revenue for the second quarter of 2025 decreased by 1.7% year-over-year to $154.9 million[49] - Net income for the second quarter of 2025 decreased by 16.3% year-over-year to $94.7 million[49] - The terminal joint venture contribution was $7.3 million, a year-over-year increase of $6.1 million[42] - Approximately 0.9 million shares were repurchased in 2Q25 for a total cost of $93.7 million[57] Volume Trends - Hawaii container volume increased by 2.6% year-over-year due to higher general demand[8] - China container volume decreased by 14.6% year-over-year primarily due to market uncertainty and tariffs[22] - Guam container volume decreased by 2.2% year-over-year[25] - Alaska container volume increased by 0.9% year-over-year[35] Outlook - The company expects full year 2025 Ocean Transportation operating income to be moderately lower than the $500.9 million achieved in 2024[62] - The company expects full year 2025 Logistics operating income to be comparable to the $50.4 million achieved in 2024[62]

Company Overview - Matson, Inc. is a leading provider of ocean transportation and logistics services, founded in 1882 [3] - The company offers 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 [3] - Matson Logistics, established in 1987, provides integrated logistics services across North America and Asia, including rail intermodal, highway brokerage, and supply chain management [3] Financial Results Announcement - Matson will release its financial results for the second quarter on July 31, 2025 [1] - A conference call is scheduled for 4:30 p.m. ET on the same day, featuring discussions by the Chairman and CEO, Matt Cox, and the CFO, Joel Wine [1][2] - The conference call will be available for live broadcast on the company's website, along with a slide presentation [2]

Core Insights - Matson, Inc. has released its 2024 Sustainability Report, highlighting its commitment to ethical standards, environmental impact reduction, and community support [1] Company Overview - Matson, founded in 1882, is a prominent 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 [2] - The company operates a diverse fleet that includes containerships, combination container and roll-on/roll-off ships, and barges, and offers premium expedited services from China to Long Beach, California [2] - Matson Logistics, established in 1987, enhances the company's transportation network across North America and Asia, providing integrated logistics services such as rail intermodal, highway brokerage, and supply chain management [2]

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]

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]