Editorial credit: Sheila Fitzgerald / Shutterstock.com

Editorial credit: Sheila Fitzgerald / Shutterstock.com

Matson Shares Surge as Company Reports Huge Profit

Mike Schuler
Total Views: 2316
February 18, 2022

Shares of U.S. shipping company Matson, Inc. ended Friday up over 11% after the company reported fourth quarter net income of nearly $395 million, bringing its 2021 profit to $927 million amid the red hot container market.

“Matson finished off a strong year with continued improvement in economic and business trends in our markets driving solid performance in both Ocean Transportation and Logistics,” said Chairman and Chief Executive Officer Matt Cox.

Matson is the leading U.S. shipping company in the Pacific trade, with services to Hawaii, Alaska, Guam, Micronesia, the South Pacific, China, and Japan. Cox said significant demand within the company’s expedited China service was the primary driver for an increase in operating income year-over-year.

Consolidated revenue for the fourth quarter 2021 was $1.267 billion, compared with $700 million for the fourth quarter 2020, bringing its full year 2021 revenue to more than $3.9 billion. Full year 2021 EBITDA came in at $1.350 billion, up from $423.7 million in 2020.

Like others in the liner sector, Matson has benefitted from soaring freight rates amid record U.S. imports and congestion in the supply chain.

“Supply chain congestion remains the current issue in the Transpacific tradelane due to ongoing elevated consumption trends, U.S. domestic supply chain constraints, and inventory restocking,” said Cox. “For 2022, we expect these conditions to remain largely in place through at least the October peak season and expect elevated demand for our China service for most of the year.”

Container volume in Matson’s Hawaii service in the fourth quarter was 10.4 percent higher year-over-year. In China, volume increased 32.7 percent, with nine more eastbound voyages on the company’s China-California Express service in 2021 than in 2020.

“In our domestic ocean tradelanes, we continued to see strong demand with higher year-over-year volumes, including the benefit of an extra week, compared to the largely pandemic-reduced volumes in the year ago period,” Cox added. “In Hawaii, we experienced elevated westbound freight demand as the state’s tourism and economy continued to rebound from the pandemic lows and the slowdown in tourism at the beginning of the quarter as a result of the state’s efforts to address the spread of the COVID-19 Delta variant. In Logistics, operating income increased year-over-year compared to the operating income achieved in the year ago period as we continued to see elevated goods consumption, inventory restocking and favorable supply and demand fundamentals in our core markets.”

In releasing its results, Matson also announced it the repurchase of approximately 1 million shares in the fourth quarter, bringing its full year repurchases to 2.5 million shares.

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