Slide 1: Second Quarter 2023 Earnings Conference Call
1 Second Quarter 2023 Earnings Conference Call Second Quarter 2023 Earnings Conference Call August 1, 2023
Slide 2: Forward-Looking Statements
2 Second Quarter 2023 Earnings Conference Call Forward-Looking Statements Statements made during this 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 August 1, 2023. We believe that our expecta
Slide 3: Opening Remarks
3 Second Quarter 2023 Earnings Conference Call Opening Remarks • Matson’s Ocean Transportation and Logistics business segments performed well despite a challenging business environment and sluggish economic growth • Ocean Transportation 2Q23: – Our China service saw higher sequential quarterly freig
Slide 4: Hawaii Service Second Quarter 2023 Performance
4 Second Quarter 2023 Earnings Conference Call Hawaii Service Second Quarter 2023 Performance • Container volume decreased 7.1% YoY – Lower retail-related volume – 2Q23 volume 3.4% lower than volume achieved in 2Q19 • During 2Q23, total visitor arrivals increased modestly YoY with an increase in int
Slide 5: Hawaii Service – Current Business Trends
5 Second Quarter 2023 Earnings Conference Call Hawaii Service – Current Business Trends UHERO Projections (2) (1) Source: https://files.hawaii.gov/dbedt/economic/data_reports/mei/2023-06-state.xls (2) Source: https://uhero.hawaii.edu/wp-content/uploads/2023/05/23Q2_Forecast.pdf 2021 2022 2023P 2024P
Slide 6: China Service Second Quarter 2023 Performance
6 Second Quarter 2023 Earnings Conference Call China Service Second Quarter 2023 Performance Container Volume (FEU Basis) 8,000 13,000 18,000 23,000 28,000 33,000 38,000 43,000 48,000 53,000 Q1 Q2 Q3 Q4 2022 2023 Note: CCX service started in 3Q21 and ended in 3Q22. • Container volume decreased 24.6%
Slide 7: China Service – Current Business Trends
7 Second Quarter 2023 Earnings Conference Call China Service – Current Business Trends • Currently in the Transpacific marketplace, we are seeing modest reductions in deployed capacity and retail inventories are in a relatively better position than earlier in the year, but retailers continue to care
Slide 8: China Service – Elements of Demand
8 Second Quarter 2023 Earnings Conference Call China Service – Elements of Demand • CLX is the fastest • CLX+ is the second fastest • Significant cost savings for 5 to 7 days of additional transit time Unmatched Destination Services: The consistency of our service is a significant differentiator in
Slide 9: Guam Service Second Quarter 2023 Performance
9 Second Quarter 2023 Earnings Conference Call Guam Service Second Quarter 2023 Performance Container Volume (FEU Basis) 3,000 3,500 4,000 4,500 5,000 5,500 6,000 Q1 Q2 Q3 Q4 2022 2023 • Container volume decreased 7.5% YoY primarily due to lower general demand • 2Q23 volume 2.1% higher than volume a
Slide 10: Alaska Service Second Quarter 2023 Performance
10 Second Quarter 2023 Earnings Conference Call Alaska Service Second Quarter 2023 Performance • Container volume decreased 7.2% YoY – Lower export seafood volume from AAX – Lower northbound volume due to one less sailing – Lower southbound volume primarily due to lower household goods and domestic
Slide 11: SSAT Joint Venture Second Quarter 2023 Performance
11 Second Quarter 2023 Earnings Conference Call SSAT Joint Venture Second Quarter 2023 Performance Equity in Income of Joint Venture ($ 5.0) $ 0.0 $ 5.0 $ 10.0 $ 15.0 $ 20.0 $ 25.0 $ 30.0 $ 35.0 $ 40.0 Q1 Q2 Q3 Q4 $ in millions 2022 2023 • Terminal joint venture contribution was $(1.4) million; YoY
Slide 12: Matson Logistics Second Quarter 2023 Performance
12 Second Quarter 2023 Earnings Conference Call Matson Logistics Second Quarter 2023 Performance Operating Income $ 0.0 $ 5.0 $ 10.0 $ 15.0 $ 20.0 $ 25.0 Q1 Q2 Q3 Q4 $ in millions 2022 2023 • Operating income of $14.3 million; YoY decrease of approximately $8.8 million – Lower contributions from tra
Slide 13: Financial Results – Summary Income Statement
13 Second Quarter 2023 Earnings Conference Call Financial Results – Summary Income Statement See the Appendix for a reconciliation of GAAP to non-GAAP Financial Metrics. Year-to-Date Second Quarter YTD Ended 6/30 D Quarters Ended 6/30 D ($ in millions, except per share data) 2023 2022 $ 2023 2022 $
Slide 14: Cash Generation and Uses of Cash
14 Second Quarter 2023 Earnings Conference Call Cash Generation and Uses of Cash ($ 600.0) ($ 400.0) ($ 200.0) $ 0.0 $ 200.0 $ 400.0 $ 600.0 $ 800.0 $ 1,000.0 Cash Flow from Operations Paydown of Borrowings, net Maintenance & Other Capex New Vessel Capex (1) Capital Construction Fund (2) Dividends S
Slide 15: Financial Results – Summary Balance Sheet
15 Second Quarter 2023 Earnings Conference Call Financial Results – Summary Balance Sheet • Total Debt of $462.4 million(1) – a reduction of $14.3 million from 1Q23 (1) Total Debt is presented before any reduction for deferred loan fees as required by GAAP. Debt Levels Share Repurchase • 2Q23: ~0.6
Slide 16: Other Financial Updates
16 Second Quarter 2023 Earnings Conference Call Other Financial Updates • CCF cash balance on 6/30/23 of $583.9 million – Nearly two-thirds of remaining milestone payments to be funded with restricted cash in CCF (1) – Made a ~$50 million milestone payment from CCF in 2Q23 for the new vessel build p
Slide 17: Closing Thoughts
17 Second Quarter 2023 Earnings Conference Call Closing Thoughts • We expect (i) the consolidated operating income in 3Q23 to be higher than the level achieved in 2Q23 and (ii) the consolidated operating income in 4Q23 to approach the level achieved in 1Q23 – Normal seasonality trends have returned
Slide 18: Appendix
18 Second Quarter 2023 Earnings Conference Call Appendix
Slide 19: Appendix – Non-GAAP Measures
19 Second Quarter 2023 Earnings Conference Call Appendix – 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, he