Matson’s profit fell significantly from a year ago as a result of a market returned to normal, but earnings were well within what the owner expected.
The New York-listed container ship owner posted $80.8m in net income for the second quarter, down from $381m for the same period in 2022.
Revenue was also much lower year over year, coming in at $773m for the quarter versus $1.26bn a year ago.
In late July, Matson predicted that it would have between $76.3m and $81.5m in earnings for the three-month period, much lower than the $381m it earned a year earlier when container freight rates were at record highs.
Its ocean transportation business recorded $82.4m in operating income for the three-month period, down from $470m during the second quarter of 2022.
“Within Ocean Transportation, our China service saw higher sequential quarterly freight demand but generated lower year-over-year volume and freight rates, which were the primary contributors to the year-over-year decline in our consolidated operating income,” chief executive Matt Cox said in a statement.
“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 carefully manage inventory levels in the face of lower consumer demand.”
The second-quarter volume of containers sent from China to the US fell 30% from a year ago to 66,800 feu during the second quarter of 2022.
But Cox still remained optimistic, saying he expects consumer demand to get better during the remainder of 2023.
“Absent an economic ‘hard landing’ in the US, we continue to expect trade dynamics to gradually improve for the remainder of the year as the transpacific marketplace transitions to a more normalised level of consumer demand and retail inventory stocking levels,” he said.
Its logistics segment posted $14.3m in operating income for the quarter, down 38% from the second quarter in 2022. The decline was mainly due to lower contributions from transportation brokerage and supply chain management.
Second-quarter logistics revenue dropped 26% to $157m, mostly due to lower revenue in transportation brokerage and supply chain management.
For the first half of 2023, Matson reported $115m in net income versus $720m in net income for the first six months of last year. Revenue amounted to $1.48bn, down from $2.43bn during the first half of 2022.
