Slide 1: Forward Looking Statements
Forward Looking Statements Statements made during this call and presentation that set forth expectations, predictions, projections or are about future events are based on facts and situations that are known to us as of today, November 4, 2015. We believe that our expectations and assumptions are rea
Slide 2: Opening Remarks
A strong third quarter 2015, benefitting from: Continued strong freight rates in expedited China service Inclusion of Alaska operations for the full quarter Increased Hawaii container volume Improved performance at SSAT and Logistics Results negatively impacted by $10.0 million of Acquisition relate
Slide 3: EBITDA, EPS – 3Q 2015
EBITDA, EPS – 3Q 2015 3Q15 Net Income of $41.5 million versus 3Q14 Net Income of $21.5 million 3Q15 Net Income would have been $47.7 million excluding Acquisition related SG&A Impact of Acquisition related SG&A in excess of incremental run-rate target $110.8 $1.08 $10.0 $0.14 See the Addendum for a
Slide 4: EBITDA, EPS – YTD 2015
EBITDA, EPS – YTD 2015 YTD15 Net Income of $76.4 million versus YTD14 Net Income of $43.0 million YTD15 Net Income would have been $96.4 million excluding Acquisition related SG&A and Molasses Settlement $260.6 $2.20 $11.4 $23.5 $0.16 $0.30 Impact of Acquisition related SG&A in excess of incremental
Slide 5: Hawaii Service
Hawaii Service Third Quarter Performance Container volume increased 14.8 percent YOY Deployment of additional vessels due to competitor schedule and fleet deployment changes Competitor’s new ship deployed as replacement tonnage; removing 5-10% of previously expected capacity growth Fourth Quarter 20
Slide 6: China Expedited Service (CLX)
China Expedited Service (CLX) Source: Shanghai Shipping Exchange Third Quarter Performance Continued strong demand for premium expedited service Sizeable premium to market rates Commodity SCFI at or near historic lows Fourth Quarter 2015 Outlook Market overcapacity expected to continue Rates expecte
Slide 7: Guam Service
Guam Service Fourth Quarter 2015 Outlook Stable economic activity Competitor announced intention to launch a bi-weekly U.S. flagged service to Guam in late November 2015 Expect some competitive volume losses after this service is launched Third Quarter Performance Steady volume On 8/29/15, the Depar
Slide 8: Alaska Service
Alaska Service Fourth Quarter 2015 Outlook Muted near-term economic activity Expect YOY volume to be negative Installation of exhaust gas scrubber on first ship Third Quarter Performance First full quarter of operations post-closing Acquisition Volume increased by approximately two percent on YOY ba
Slide 9: SSAT Joint Venture
SSAT Joint Venture Third Quarter Performance Improved lift volumes Fourth Quarter 2015 Outlook Profit to exceed the 4Q2014 level Well positioned in LA/LB and Oakland for increased lift volumes from major international carriers
Slide 10: Matson Logistics
Matson Logistics Third Quarter Performance Lower international intermodal and highway volume Lower fuel surcharge revenue Favorable changes in business mix and contribution margins Improved warehouse results Source: Association of American Railroads Fourth Quarter 2015 Outlook Operating income expec
Slide 11: 3Q2015 Operating Income
3Q2015 Operating Income SSAT had a $4.5 million contribution in 3Q15 compared to a $3.1 million contribution in 3Q14 3Q14 3Q15 Change Revenue $329.5 $444.8 $115.3 Operating Income $42.6 $68.9 $26.3 Oper. Income Margin 12.9% 15.5% 3Q14 3Q15 Change Revenue $112.3 $99.5 ($12.8) Operating Income $2.4 $2
Slide 12: YTD 2015 Operating Income
YTD 2015 Operating Income SSAT had a $13.1 million contribution in YTD15 compared to a $5.4 million contribution in YTD14 YTD14 YTD15 Change Revenue $945.2 $1,097.0 $151.8 Operating Income $84.8 $144.2 $59.4 Oper. Income Margin 9.0% 13.1% YTD14 YTD15 Change Revenue $325.5 $293.1 ($32.4) Operating In
Slide 13: Condensed Statement of Income
Condensed Statement of Income Key Items Total revenue increased 23.2% Operating margin increased to 13.2% from 10.2% (in $ millions) 3Q15 3Q14 Operating Revenue Ocean Transportation $444.8 $329.5 Logistics 99.5 112.3 Total operating revenue 544.3 441.8 Costs and Expenses Operating costs 424.8 363.8
Slide 14: Condensed Balance Sheet
Condensed Balance Sheet Assets (in $ millions) 9/30/15 12/31/14 Cash and cash equivalents $ 25.5 $ 293.4 Other current assets 322.8 226.1 Total current assets 348.3 519.5 Investment in terminal joint venture 68.2 64.4 Property and equipment, net 839.9 691.2 Capital Construction Fund deposits 11.7 27
Slide 15: Cash Generation and Uses of Cash
Cash Generation and Uses of Cash Does not include $6.6 million in other uses of cash Based on total cash consideration (including common shares, warrants, repaid debt, accrued interest and breakage fees)
Slide 16: Announced 3.0 Million Share Repurchase Program
Board authorized the repurchase of 3.0 million common shares over three years View share repurchases as an important capital efficiency tool Steady, measured pace expected on share repurchases Focus remains on cash flow generation and long-term shareholder value Remain confident in balance sheet str
Slide 17: Fourth Quarter 2015 Outlook
Outlook is exclusive of Acquisition related SG&A in excess of incremental run-rate target and is being provided relative to 2014 operating income Ocean Transportation operating income for 4Q2015 to approximate the $46.3 million achieved in 4Q2014 primarily due to: Higher Hawaii volume Alaska tradela
Slide 18: Summary Remarks
Summary Remarks Hawaii Expect to benefit from continued market growth and a stronger market position Alaska Integration progressing well Low energy prices create near-term economic headwinds China Beginning to lap the very strong results achieved in late 2014 Guam U.S. Marine relocation provides a l
Slide 19: Summary Remarks
Summary Remarks a NYSE Hawaii - Expect to benefit from continued market growth and a stronger market position Alaska - Integration progressing well - Low energy prices create near-term economic headwinds China - Beginning to lap the very strong results achieved in late 2014 Guam - U.S. Marine reloca
Slide 20: Addendum – Use of Non-GAAP Measures
Addendum – Use of Non-GAAP Measures Matson reports financial results in accordance with U.S. generally accepted accounting principles (“GAAP”). The Company also considers other non-GAAP measures to evaluate performance, make day-to-day operating decisions, help investors understand our ability to in
Slide 21: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation NET DEBT RECONCILIATION $ 481.5 Less: Cash and cash equivalents (25.5) Cash on deposit in Capital Construction Fund (11.7) $ 444.3 EBITDA RECONCILIATION Change $ 41.5 $ 21.5 $ 20.0 $ 104.2 Add: Income tax expense 25.6 19.1 6.5 77.7 Add: Interest expense 4.7 4.4 0.3 17
Slide 22: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Diluted Earnings per Share before Acquisition Related SG&A and Molasses Settlement Reconciliation (in millions, except per share amount) Nine Months Ended September 30, 2015 Net Income $ 41.5 $ 76.4 Add: Acquisition related SG&A in excess of run-rate target 10.0 23.5
Slide 23: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation Diluted Earnings per Share before Acquisition Related SG&A and Molasses Settlement Reconciliation ‘Three Months Ended (in millions, except per share amount) September 30, Net Income s 415 Add: Acquisition related SGKA in excess of run-rate target 109 ‘Add: Molasses Se