Honolulu-based Matson Inc. expects the first quarter operating income for its ocean transportation business to be $410-to-$415 million and the operating income for its logistics business to be $16-to-$17 million, with Q1 2022 net income anticipated to be $329.5-to-$338 million, according to the company.
Ahead of the company’s May 3 first quarter earnings call, Matson’s CEO said the company is off to a solid start this year with higher year-over-year operating income in ocean transportation and logistics.
“Within ocean transportation, our China service continued to see significant demand for its expedited ocean services as volume for e-commerce, garments and other goods remained elevated,” Matson Chairman and Chief Executive Officer Matt Cox said in an announcement.
The China service primarily drove the higher consolidated operating income year-over-year, he said.
Supply chain challenges in China are expected to continue in the Transpacific trade lane because of efforts to curb the spread of COVID-19, ongoing congestion in the U.S. West Coast and constraints on the supply chain, elevated consumption trends and inventory restocking, he said.
“Despite the near-term uncertainty presented by the supply chain challenges in China, we expect a combination of the current supply and demand factors to remain largely in place through at least the October peak season and continue to expect elevated demand for our China service for most of this year,” Cox stated.
For domestic ocean trade lanes, Matson continued to see steady demand with higher year-over-year volumes in Alaska and Guam, and demand in Hawaii comparable to the level achieved in the previous year, he said.
“In logistics, operating income increased year-over-year with strength across all of the business lines as we continued to see elevated goods consumption, inventory restocking and favorable supply and demand fundamentals in our core markets,” Cox remarked.