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What changed in Matson, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of Matson, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+234 added−243 removedSource: 10-K (2025-02-28) vs 10-K (2024-02-23)

Top changes in Matson, Inc.'s 2024 10-K

234 paragraphs added · 243 removed · 202 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

69 edited+6 added−16 removed46 unchanged
Biggest changePFEIFFER (4)(7) 1992 979814 2,245 300 — 713’ 6” 23.0 28,000 — MOKIHANA (4) 1983 655397 1,994 354 1,323 860’ 2” 23.0 30,000 — MAUNALEI (4)(7) 2006 1181627 1,992 328 — 681’ 1” 22.1 33,000 — MATSON KODIAK (4)(7) 1987 910308 1,668 280 — 710’ 0” 20.0 20,000 — MATSON ANCHORAGE (4)(7) 1987 910306 1,668 280 — 710’ 0” 20.0 20,000 — MATSON TACOMA (4)(7) 1987 910307 1,668 280 — 710’ 0” 20.0 20,000 — KAMOKUIKI (5) 2000 9232979 707 100 — 433’ 9” 17.5 8,000 — OLOMANA (6) ​ 2004 ​ 9184225 ​ 645 ​ 120 ​ — ​ 388’ 7” ​ 14.0 ​ 8,000 ​ — IMUA (6) 2004 9184237 645 90 — 388’ 6” 15.0 8,000 — LILOA II (6) 2006 9184249 630 90 — 388’ 6” 15.0 ​ 8,000 ​ — PAPA MAU (6) 1999 9141704 521 60 — 381’ 5” 14.0 6,000 — Vessels-Chartered: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ MATSON WAIKIKI (6) ​ 2008 ​ 9349801 ​ 4,946 ​ 400 ​ — ​ 902’ 0” ​ 22.5 ​ 62,000 ​ September 2025 MATSON LANAI (6) ​ 2007 ​ 9334143 ​ 4,253 ​ 400 ​ — ​ 855’ 2” ​ 24.3 ​ 50,000 ​ June 2025 MATSON MAUI (6) ​ 2007 ​ 9340764 ​ 4,253 ​ 400 ​ — ​ 854’ 8” ​ 24.5 ​ 50,000 ​ March 2026 MATSON OAHU (6) ​ 2008 ​ 9352406 ​ 4,245 ​ 535 ​ — ​ 853’ 0” ​ 24.3 ​ 50,000 ​ October 2024 MATSON KAUAI (6) ​ 2008 ​ 9353278 ​ 4,218 ​ 350 ​ — ​ 881’ 11” ​ 24.8 ​ 52,000 ​ January 2025 MATSON MOLOKAI (6) ​ 2007 ​ 9338084 ​ 2,824 ​ 586 ​ — ​ 728’ 10” ​ 22.0 ​ 39,000 ​ May 2025 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Barges-Owned: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ MAUNA LOA (4) 2013 1247426 500 78 — 362’ 6” — 13,000 — HALEAKALA (4) 2022 1324310 620 72 — 362’ 6” — 15,000 — Barges-Chartered: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ILIULIUK BAY (4) 2013 1249384 178 — — 250’ 0” — 4,000 December 2024 (1) Twenty-foot Equivalent Units (“TEU”) is a standard measure of cargo volume correlated to a standard 20-foot dry cargo container.
Biggest changePFEIFFER (4)(7) 1992 979814 2,245 300 — 713’ 6” 23.0 28,000 — MOKIHANA (4) 1983 655397 1,994 354 1,323 860’ 2” 23.0 30,000 — MAUNALEI (4)(7) 2006 1181627 1,992 328 — 681’ 1” 22.1 33,000 — MATSON KODIAK (4)(7) 1987 910308 1,668 280 — 710’ 0” 20.0 20,000 — MATSON ANCHORAGE (4)(7) 1987 910306 1,668 280 — 710’ 0” 20.0 20,000 — MATSON TACOMA (4)(7) 1987 910307 1,668 280 — 710’ 0” 20.0 20,000 — KAMOKUIKI (5) 2000 9232979 707 100 — 433’ 9” 17.5 8,000 — OLOMANA (6) ​ 2004 ​ 9184225 ​ 645 ​ 120 ​ — ​ 388’ 7” ​ 14.0 ​ 8,000 ​ — IMUA (6) 2004 9184237 645 90 — 388’ 6” 15.0 8,000 — LILOA II (6) 2006 9184249 630 90 — 388’ 6” 15.0 ​ 8,000 ​ — PAPA MAU (6) 1999 9141704 521 60 — 381’ 5” 14.0 6,000 — Vessels-Chartered: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ MATSON MAGNOLIA (6) ​ 2006 ​ 9302578 ​ 5,060 ​ 454 ​ — ​ 964’ 9” ​ 23.0 ​ 67,000 ​ December 2027 MATSON WAIKIKI (6) ​ 2008 ​ 9349801 ​ 4,946 ​ 400 ​ — ​ 902’ 0” ​ 22.5 ​ 62,000 ​ September 2028 MATSON LANAI (6) ​ 2007 ​ 9334143 ​ 4,253 ​ 400 ​ — ​ 855’ 2” ​ 24.3 ​ 53,000 ​ August 2027 MATSON MAUI (6) ​ 2007 ​ 9340764 ​ 4,253 ​ 400 ​ — ​ 854’ 8” ​ 24.5 ​ 50,000 ​ March 2026 MATSON OAHU (6) ​ 2008 ​ 9352406 ​ 4,245 ​ 535 ​ — ​ 853’ 0” ​ 24.3 ​ 53,000 ​ November 2027 MATSON KAUAI (6) ​ 2008 ​ 9353278 ​ 4,218 ​ 350 ​ — ​ 881’ 11” ​ 24.8 ​ 52,000 ​ August 2027 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Barges-Owned: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ MAUNA LOA (4) 2013 1247426 500 78 — 362’ 6” — 13,000 — HALEAKALA (4) 2022 1324310 620 72 — 362’ 6” — 15,000 — ISLANDER (5) 2024 ​ 1348946 ​ 100 ​ — ​ — ​ 180’ 0” ​ — ​ 2,000 ​ — Barges-Chartered: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ILIULIUK BAY (4) 2013 1249384 178 — — 250’ 0” — 4,000 December 2025 (1) Container numbers are based upon vessel construction specifications.
A U.S. flagged Jones Act barge operator, Aloha Marine Lines, also offers barge service between Seattle, Washington and Hawaii. ​ Foreign-flagged vessels carrying cargo to Hawaii from non-U.S. locations also provide alternatives for companies shipping to Hawaii.
A U.S. flagged Jones Act barge operator, Aloha Marine Lines, offers barge service between Seattle, Washington and Hawaii. ​ Foreign-flagged vessels carrying cargo to Hawaii from non-U.S. locations also provide alternatives for companies shipping to Hawaii.
Matson has offices located in Shanghai, Shenzhen, Xiamen, Ningbo and Hong Kong, and has contracted with terminal operators in Ningbo and Shanghai. ​ Guam Service: Matson’s Guam service has one major competitor, APL, a U.S. flagged subsidiary of CMA CGM, which operates a U.S. flagged container service connecting the U.S.
Matson has offices located in Shanghai, Ningbo, Shenzhen, Xiamen and Hong Kong, and has contracted with terminal operators in Ningbo and Shanghai. ​ Guam Service: Matson’s Guam service has one major competitor, APL, a subsidiary of CMA CGM, which operates a U.S. flagged container service connecting the U.S.
Freight Forwarding Services: Matson Logistics provides LCL consolidation and freight forwarding services primarily to the Alaska market through its wholly-owned subsidiary, Span Intermediate, LLC (“Span Alaska”). Span Alaska’s business aggregates LCL freight at its cross-dock facility in Auburn, Washington for consolidation and shipment to its service center in Anchorage and a network of other facilities in Alaska.
Freight Forwarding Services: Matson Logistics provides Freight Forwarding services primarily to the Alaska market through its wholly-owned subsidiary, Span Intermediate, LLC (“Span Alaska”). Span Alaska’s business aggregates LCL freight at its cross-dock facility in Auburn, Washington for consolidation and shipment to its service center in Anchorage and a network of other facilities in Alaska.
While factors such as job, location and business unit ultimately determine which plans an employee may be eligible for, the Company’s total rewards offering includes market competitive base salaries, cash and equity incentives, recognition awards, health and welfare benefits, and employee and employer funded retirement plans.
While factors such as job, location and business unit ultimately determine plans for which an employee may be eligible, the Company’s total rewards offering includes market competitive base salaries, cash and equity incentives, recognition awards, health and welfare benefits, and employee and employer funded retirement plans.
The majority of Matson’s Hawaii service revenue is derived from the westbound carriage of containerized freight. ​ China Service: Matson’s expedited China-Long Beach Express (“CLX”) service is part of an integrated service that carries cargo from Long Beach, California to Honolulu, Hawaii, to Guam, and then to Okinawa, Japan.
The majority of Matson’s Hawaii service revenue is derived from the westbound carriage of containerized freight. ​ China Service: Matson’s expedited China-Long Beach Express (“CLX”) service is part of an integrated service that carries cargo from Long Beach, California to Honolulu, Hawaii, Guam, and Okinawa, Japan.
The NZX service also distributes and sells domestic bulk fuel to a variety of these islands. ​ Terminal and Other Related Services: ​ Matson provides stevedoring, refrigerated cargo services, inland transportation, container equipment maintenance and other terminal services (collectively, “terminal services”) at terminals located on the Hawaiian islands of Oahu, Hawaii, Maui and Kauai; and in the Alaska terminal locations of Anchorage, Kodiak and Dutch Harbor. ​ SSAT currently provides terminal and stevedoring services to various carriers at eight terminal facilities on the U.S.
The NZX service also delivers and sells domestic bulk fuel to a variety of these islands. ​ Terminal and Other Related Services: ​ Matson provides stevedoring, refrigerated cargo services, inland transportation, container equipment maintenance and other terminal services (collectively, “terminal services”) at terminals located on the Hawaiian islands of Oahu, Hawaii, Maui and Kauai; and in the Alaska terminal locations of Anchorage, Kodiak and Dutch Harbor. ​ SSAT currently provides terminal and stevedoring services to various carriers at eight terminal facilities on the U.S.
(“SSAT”). SSAT currently provides terminal and stevedoring services to various carriers at eight terminal facilities on the U.S. West Coast, including three facilities dedicated for MatNav’s use.
SSAT currently provides terminal and stevedoring services to various carriers at eight terminal facilities on the U.S. West Coast, including three facilities dedicated for MatNav’s use.
Matson Logistics creates significant benefits and value for its customers through volume purchases of rail, motor carrier and ocean transportation services, augmented by services such as shipment tracking and tracing, accessibility to its private fleet of 53-foot intermodal containers and single-vendor invoicing. Matson Logistics operates customer service centers and has sales offices throughout North America.
Matson Logistics creates significant benefits and value for its customers through volume purchases of rail, motor carrier and ocean transportation services, augmented by services such as shipment tracking and tracing, accessibility to its owned fleet of 53-foot intermodal containers and single-vendor invoicing. Matson Logistics operates customer service centers and has sales offices throughout North America.
The AAX service utilizes CLX+ vessels on their westbound return voyages to China. ​ South Pacific Service: Matson’s New Zealand Express (“NZX”) service provides carriage of general sustenance cargo between Auckland, New Zealand and select islands in the South Pacific, including Fiji (Suva and Lautoka), Samoa (Apia), American Samoa (Pago Pago), the Cook Islands (Rarotonga and Aitutaki), Tonga (Nukualofa and Vava’u), and Niue.
The AAX service utilizes MAX vessels on their westbound return voyages to China. ​ South Pacific Service: Matson’s New Zealand Express (“NZX”) service provides carriage of general sustenance cargo between Auckland, New Zealand and select islands in the South Pacific, including Fiji (Suva and Lautoka), Samoa (Apia), American Samoa (Pago Pago), the Cook Islands (Rarotonga and Aitutaki), Tonga (Nukualofa and Vava’u), and Niue.
As shown in the chart below, Matson’s shoreside and seagoing union employees comprise 70 percent of Matson’s global workforce. ​ ​ Matson and SSAT are also members of the Pacific Maritime Association (“PMA”), which on behalf of its members negotiates collective bargaining agreements with the International Longshore and Warehouse Union (“ILWU”) on the U.S. West Coast.
As shown in the chart below, Matson’s shoreside and seagoing union employees comprise 69 percent of Matson’s global workforce. ​ ​ Matson and SSAT are also members of the Pacific Maritime Association (“PMA”), which on behalf of its members negotiates collective bargaining agreements with the International Longshore and Warehouse Union (“ILWU”) on the U.S. West Coast.
Other competitors include air freight carriers. ​ Matson’s China service (CLX and CLX+) competes by offering fast and reliable service from the ports of Ningbo and Shanghai in China, and feeder services from other Asian ports of origin, to Long Beach, California. Matson provides fixed day-of-the-week arrivals and industry leading cargo availability.
Other competitors include air freight carriers. ​ Matson’s China service (CLX and MAX) competes by offering fast and reliable service from the ports of Ningbo and Shanghai in China, and feeder services from other Asian ports of origin connecting in Shanghai, China, to Long Beach, California. Matson provides fixed day-of-the-week arrivals and industry leading cargo availability.
Each new vessel is expected to provide approximately 500 containers of additional capacity per voyage in the CLX service. ​ The contract cost of the new vessel program is approximately $1.0 billion in total, and milestone payments are expected to be financed with cash currently on deposit in the Company’s Capital Construction Fund, cash and cash equivalents on the Company’s Consolidated Balance Sheets and through cash flows generated from future operations, borrowings available under the Company’s unsecured revolving credit facility or additional debt financings .
Each new vessel is expected to provide approximately 500 containers of additional capacity per voyage in the CLX service. ​ The initial contract cost of the new vessel program is approximately $1.0 billion, with milestone payments expected to be financed with cash currently on deposit in the Company’s Capital Construction Fund, cash and cash equivalents on the Company’s Consolidated Balance Sheets and through cash flows generated from future operations, borrowings available under the Company’s unsecured revolving credit facility or additional debt financings .
(8) Vessel can operate on liquified natural gas (“LNG”), conventional or alternative fuels. ​ ​ ​ 4 Table of Contents Fleet Renewal Program: ​ Matson is constructing three new vessels with the following specifications and expected delivery dates: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Usable Cargo Capacity ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Containers ​ ​ ​ Maximum ​ Maximum ​ Type of Expected Reefer ​ ​ Speed Deadweight Class of Vessel ​ Vessel ​ Delivery Date ​ TEUs ​ Slots ​ Length ​ (Knots) ​ (Long Tons) Aloha Class Containership Q4 2026 ​ 3,620 400 ​ 853’ 2” 23.5 53,000 Aloha Class ​ Containership ​ Q2 2027 ​ 3,620 ​ 400 ​ 853’ 2” ​ 23.5 ​ 53,000 Aloha Class ​ Containership ​ Q4 2027 ​ 3,620 ​ 400 ​ 853’ 2” ​ 23.5 ​ 53,000 ​ Matson expects to deploy the three new vessels in the CLX service and redeploy three existing vessels into the Alaska service.
(8) Vessel can operate on liquified natural gas (“LNG”), conventional or alternative fuels. ​ ​ ​ 4 Table of Contents Fleet Renewal Program: ​ Matson is constructing three new vessels with the following specifications and expected delivery dates: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Usable Cargo Capacity ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Containers ​ ​ ​ Maximum ​ Maximum ​ Type of Expected Reefer ​ ​ Speed Deadweight Class of Vessel ​ Vessel ​ Delivery Date ​ TEUs ​ Slots ​ Length ​ (Knots) ​ (Long Tons) Aloha Class Containership Q1 2027 ​ 3,620 400 ​ 853’ 2” 23.5 53,000 Aloha Class ​ Containership ​ Q3 2027 ​ 3,620 ​ 400 ​ 853’ 2” ​ 23.5 ​ 53,000 Aloha Class ​ Containership ​ Q2 2028 ​ 3,620 ​ 400 ​ 853’ 2” ​ 23.5 ​ 53,000 ​ Matson expects to deploy the three new Aloha Class vessels in the CLX service and redeploy three existing vessels into the Alaska service.
In addition, subsidiaries of MatNav provide stevedoring, refrigerated cargo services, inland transportation and other terminal services for MatNav on the Hawaiian islands of Oahu, Hawaii, Maui and Kauai, and for MatNav and other ocean carriers in Alaska. ​ Matson has a 35 percent ownership interest in SSA Terminals, LLC, a joint venture between Matson Ventures, Inc., a wholly-owned subsidiary of MatNav, and SSA Ventures, Inc., a subsidiary of Carrix, Inc.
In addition, subsidiaries of MatNav provide stevedoring, refrigerated cargo services, inland transportation and other terminal services for MatNav on the Hawaiian islands of Oahu, Hawaii, Maui and Kauai, and in Alaska. ​ Matson has a 35 percent ownership interest in SSA Terminals, LLC (“SSAT”), a joint venture between Matson Ventures, Inc., a wholly-owned subsidiary of MatNav, and SSA Ventures, Inc., a subsidiary of Carrix, Inc.
Details of Matson’s active and reserve vessels as of December 31, 2023 are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Usable Cargo Capacity ​ ​ ​ Vessel ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Containers ​ Vehicles ​ ​ ​ Design ​ Approximate ​ Charter ​ Year Official ​ Reefer Speed Deadweight Expiration Name of Vessels ​ Built ​ Number ​ TEUs (1) ​ Slots ​ Autos ​ Length ​ (Knots) (2) ​ (Long Tons) ​ Date (3) Vessels-Owned: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ DANIEL K.
Details of Matson’s active and reserve fleet as of December 31, 2024 are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Usable Cargo Capacity ​ ​ ​ Vessel ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Containers (1) ​ Vehicles ​ ​ ​ Design ​ Approximate ​ Charter ​ Year Official ​ Reefer Speed Deadweight Expiration Name of Vessel ​ Built ​ Number ​ TEUs ​ Slots ​ Autos ​ Length ​ (Knots) (2) ​ (Long Tons) ​ Date (3) Vessels-Owned: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ DANIEL K.
MatNav also operates premium, expedited services from China to Long Beach, California, provides services to Okinawa, Japan and various islands in the South Pacific, and operates an international export service from Dutch Harbor, Alaska to Asia.
MatNav also operates premium, expedited services from China to Long Beach, California, provides services to Okinawa, Japan and various islands in the South Pacific, and operates an international export service from Alaska to Asia.
Matson also provides a barge service between Dutch Harbor and Akutan in Alaska, and transportation services to other locations in Alaska including the Kenai Peninsula, Fairbanks and the North Slope. ​ Northbound cargo to Alaska consists mainly of dry containers of mixed commodities, refrigerated commodities, food, beverages, retail merchandise, household goods and automobiles.
Matson also provides a barge service between Dutch Harbor and Akutan in Alaska, and transportation services to other locations in Alaska including the Kenai Peninsula, Fairbanks and the North Slope. ​ 2 Table of Contents Northbound cargo to Alaska consists mainly of dry containers of mixed commodities, refrigerated commodities, food, beverages, retail merchandise, household goods and automobiles.
Warehousing and Distribution Services: Matson Logistics operates two warehouses in Georgia and two warehouses in Northern California providing warehousing, trans-loading, value-added packaging and distribution services. ​ Supply Chain Management and Other Services: Matson Logistics provides customers with a variety of logistics services including purchase order management, booking services, customs brokerage, LCL and full container load NVOCC freight forwarding services.
Warehousing Services: Matson Logistics operates two warehouses in Georgia and two warehouses in Northern California providing warehousing, trans-loading, value-added packaging and distribution services. ​ Supply Chain Management and Other Services: Matson Logistics provides customers with a variety of logistics services including purchase order management, booking services, customs brokerage, LCL and full container load NVOCC 9 Table of Contents freight forwarding services.
The Company actively monitors its operations for compliance with these and other regulations. ​ For more information on Matson’s environmental stewardship initiatives, including its environmental goals, see Matson’s Sustainability Report and other information available at https://www.matson.com/sustainability. ​ 9 Table of Contents (2) LOGISTICS SEGMENT ​ Logistics Services: ​ Matson Logistics provides the following services: Transportation Brokerage Services: Matson Logistics provides intermodal rail, highway, and other third-party logistics services for North American customers and international ocean carrier customers, including MatNav.
The Company actively monitors its operations for compliance with these and other regulations. ​ For more information on Matson’s environmental stewardship initiatives, including its environmental goals, see Matson’s Sustainability Report and other information available at https://www.matson.com/sustainability. ​ (2) LOGISTICS SEGMENT ​ Logistics Services: ​ Matson Logistics provides the following services: Transportation Brokerage Services: Matson Logistics provides intermodal rail, highway, and other third-party logistics services for North American customers and international ocean carrier customers, including MatNav.
Established in 1987, Matson Logistics extends the geographic reach of Matson’s transportation network throughout North America and Asia, and is an asset-light business that provides a variety of logistics services to its customers including: (i) multimodal transportation brokerage of domestic and international rail intermodal services, long-haul and regional highway trucking services, specialized hauling, flat-bed and project services, less-than-truckload services, and expedited freight services (collectively, “Transportation Brokerage” services); (ii) less-than-container load (“LCL”) consolidation and freight forwarding services (collectively, “Freight Forwarding” services); (iii) warehousing, trans-loading, value-added packaging and distribution services (collectively, “Warehousing” services); and (iv) supply chain management, non-vessel operating common carrier (“NVOCC”) freight forwarding and other services. ​ Our Mission and Vision: ​ Our mission is to move freight better than anyone.
Established in 1987, Matson Logistics extends the geographic reach of Matson’s transportation network throughout North America and Asia, and is an asset-light business that provides a variety of logistics services to its customers including: (i) multimodal transportation brokerage of domestic and international rail intermodal services, long-haul and regional highway trucking services, specialized hauling, flat-bed and project services, less-than-truckload services, and expedited freight services (collectively, “Transportation Brokerage” services); (ii) less-than-container load (“LCL”) consolidation and freight forwarding services (collectively, “Freight Forwarding” services); (iii) warehousing, trans-loading, value-added packaging and distribution services (collectively, “Warehousing” services); and (iv) purchase order management, booking services, and non-vessel operating common carrier (“NVOCC”) freight forwarding services (collectively, “Supply Chain Management” services). ​ Our Mission and Vision: ​ Our mission is to move freight better than anyone.
Effective January 1, 2020, the IMO imposed regulations that generally require all vessels to burn fuel oil with a maximum sulfur content of ≤0.5 percent. With respect to North America, all waters, 5 Table of Contents with certain limited exceptions, within 200 nautical miles of U.S. and Canadian coastlines have been designated emission control areas (“ECAs”).
Effective January 1, 2020, the IMO imposed regulations that generally require all vessels to burn fuel oil with a maximum sulfur content of ≤0.5 percent. With respect to North America, all waters, with certain limited exceptions, within 200 nautical miles of U.S. and Canadian coastlines have been designated emission control areas (“ECAs”). Since January 1, 2015, U.S.
Matson’s service is further differentiated by best-in-class stevedoring services provided by SSAT, Matson dedicated terminal space, access to Shippers Transport Express off-dock container yards for faster truck turn times, Matson-dedicated equipment including chassis to speed cargo availability, one-stop intermodal connections, and world-class customer service. Matson also provides intermodal 7 Table of Contents services in coordination with Matson Logistics.
Matson’s service is further differentiated by best-in-class stevedoring services provided by SSAT, Matson dedicated terminal space, access to Shippers Transport Express off-dock container yards for faster truck turn times, Matson-dedicated equipment including chassis to speed cargo availability, one-stop intermodal connections, and world-class customer service. Matson also provides intermodal services in coordination with Matson Logistics.
Other competitors in the Hawaii service include proprietary operators and contract carriers of bulk cargo, and air freight carriers. ​ Matson operates three strings of vessels to Hawaii. These strings provide customers an industry-leading five departures from ports on the U.S.
Other competitors in the Hawaii service include proprietary operators and contract carriers of bulk cargo, and air freight carriers. 6 Table of Contents ​ Matson operates three strings of vessels to Hawaii. These strings provide customers an industry-leading five departures from ports on the U.S.
Matson’s AAX service also offers customers a service from Kodiak and Dutch Harbor, Alaska to Ningbo and Shanghai, China, and Busan, South Korea, with transshipment services from those ports to other locations in Asia. ​ China Service: Major competitors to Matson’s China service include large international transpacific carriers such as CMA CGM, OOCL, ZIM, Evergreen and Cosco.
Matson’s AAX service also offers customers a service from Kodiak and Dutch Harbor, Alaska to Ningbo and Shanghai, China, and Busan, South Korea, with transshipment services from those ports to other locations in Asia. ​ China Service: Major competitors to Matson’s China service include international transpacific carriers such as CMA CGM, Zim, Hede and Cosco.
Additionally, while Matson Logistics primarily provides surface transportation brokerage, it also competes to a lesser degree with other forms of transportation for the movement of cargo such as air freight. ​ Matson Logistics’ freight forwarding services compete most directly with a variety of freight forwarding companies that operate within Alaska including Carlile, Lynden and American Fast Freight. ​ Customer Concentration: ​ Matson Logistics serves customers in numerous industries and geographical locations.
Additionally, while Matson Logistics primarily provides surface transportation brokerage, it also competes to a lesser degree with other forms of transportation for the movement of cargo such as air freight. ​ Matson Logistics’ Freight Forwarding services compete most directly with a variety of freight forwarding companies that operate within Alaska including Carlile, Lynden and Odyssey. ​ Customer Concentration: ​ Matson Logistics serves customers in numerous industries.
INOUYE (4)(8) ​ 2018 1274136 3,160 408 ​ — 854’ 0” 23.5 51,000 — KAIMANA HILA (4) ​ 2019 ​ 1274135 ​ 3,220 ​ 408 ​ — ​ 854’ 0” ​ 23.5 54,000 — MANOA (4)(7) 1982 651627 2,824 408 — 860’ 2” 23.0 35,000 — MAHIMAHI (4)(7) 1982 653424 2,824 408 — 860’ 2” 23.0 35,000 — LURLINE (4) ​ 2019 ​ 1274143 ​ 2,750 ​ 432 ​ 500 ​ 869’ 5” ​ 23.0 ​ 51,000 ​ — MATSONIA (4) ​ 2020 ​ 1274123 ​ 2,750 ​ 432 ​ 500 ​ 869’ 5” ​ 23.0 ​ 51,000 ​ — MANULANI (4)(7) 2005 1168529 2,378 284 — 712’ 0” 22.5 38,000 — MAUNAWILI (4)(7) 2004 1153166 2,378 326 — 711’ 9” 22.5 37,000 — MANUKAI (4)(7) 2003 1141163 2,378 326 — 711’ 9” 22.5 38,000 — R.J.
INOUYE (4)(8) ​ 2018 1274136 3,160 408 ​ — 854’ 0” 23.5 51,000 — KAIMANA HILA (4)(8) ​ 2019 ​ 1274135 ​ 3,020 ​ 408 ​ — ​ 854’ 0” ​ 23.5 52,000 — MANOA (4)(7) 1982 651627 2,824 408 — 860’ 2” 23.0 35,000 — MAHIMAHI (4)(7) 1982 653424 2,824 408 — 860’ 2” 23.0 35,000 — LURLINE (4) ​ 2019 ​ 1274143 ​ 2,750 ​ 432 ​ 500 ​ 869’ 5” ​ 23.0 ​ 51,000 ​ — MATSONIA (4) ​ 2020 ​ 1274123 ​ 2,750 ​ 432 ​ 500 ​ 869’ 5” ​ 23.0 ​ 51,000 ​ — MANULANI (4)(7) 2005 1168529 2,378 284 — 712’ 0” 22.5 38,000 — MAUNAWILI (4)(7) 2004 1153166 2,378 326 — 711’ 9” 22.5 37,000 — MANUKAI (4)(7)(8) 2003 1141163 2,000 270 — 711’ 9” 22.5 36,000 — R.J.
West Coast to the port of Naha in Okinawa, Japan. ​ Matson offers customers a fast and reliable weekly service to the port of Naha in Okinawa, Japan as part of the CLX service from three ports on the U.S.
West Coast to the port of Naha in Okinawa, Japan. 7 Table of Contents ​ Matson offers customers a fast and reliable weekly service to the port of Naha in Okinawa, Japan as part of the CLX service from three ports on the U.S.
These numbers include seagoing personnel who rotate through billets (as described below) and temporary employees, but do not include employees of SSAT or other non-employee affiliates such as agents and contractors. The composition of Matson’s workforce by geography is as follows: ​ ​ Matson’s fleet of active vessels requires 326 billets to operate.
These numbers include seagoing personnel who rotate through billets (as described below) and temporary employees, but do not include employees of SSAT or other non-employee affiliates such as agents and contractors. The composition of Matson’s workforce by geography is as follows: ​ ​ As of December 31, 2024, Matson’s fleet of active vessels requires 370 billets to operate.
West Coast with three exclusive use terminals provided by SSAT; a dedicated inter-island barge network which is integrated with Matson’s line haul schedule; roll-on/roll-off service from Long Beach and Oakland; a world-class customer service team; and efficiency and experience in handling cargo of many types. ​ Alaska Service: Matson’s Alaska service has one major U.S. flagged Jones Act competitor, Totem Ocean Trailer Express, Inc., which operates a roll-on/roll-off service between Tacoma, Washington and Anchorage, Alaska.
West Coast with three exclusive use terminals provided by SSAT that allow for quicker and more reliable port calls; a dedicated inter-island barge network which is integrated with Matson’s line haul schedule; roll-on/roll-off service from Long Beach and Oakland; a world-class customer service team; and efficiency and experience in handling cargo of many types. ​ Alaska Service: Matson’s Alaska service has one major U.S. flagged Jones Act competitor, Totem Ocean Trailer Express, Inc., which operates a roll-on/roll-off service between Tacoma, Washington and Anchorage, Alaska.
The Company’s 10 largest Ocean Transportation customers account for approximately 16 percent of the Company’s Ocean Transportation revenue.
The Company’s 10 largest Ocean Transportation customers account for approximately 18 percent of the Company’s Ocean Transportation revenue.
The Company’s 10 largest logistics customers account for approximately 21 percent of the Company’s Logistics revenue.
The Company’s 10 largest logistics customers account for approximately 17 percent of the Company’s Logistics revenue.
West Coast to Guam and Saipan, via transshipments to U.S. flagged feeder vessels in Yokohama, Japan and Busan, South Korea via a two-ship feeder service.
West Coast to Guam and Saipan, via transshipments to U.S. flagged feeder vessels in Yokohama, Japan and Busan, South Korea via a two-ship feeder service, and a third-party U.S. flagged service with transshipments from Guam to Saipan.
West Coast, Hawaii and Alaska on foreign-built or foreign-documented vessels is prohibited. 8 Table of Contents ​ During the years ended December 31, 2023, 2022 and 2021, approximately 55 percent, 39 percent and 41 percent, respectively, of Matson’s Ocean Transportation revenues came from the Hawaii and Alaska trades that were subject to the Jones Act.
West Coast, Hawaii and Alaska on foreign-built or foreign-documented vessels is prohibited. ​ During the years ended December 31, 2024, 2023 and 2022, approximately 50 percent, 55 percent and 39 percent, respectively, of Matson’s Ocean Transportation revenues came from the Hawaii and Alaska trades that were subject to the Jones Act.
Matson further contributes positively to the environment by testing and deploying leading technologies as the fleet is modernized. ​ The International Maritime Organization (“IMO”), to which the U.S. and over 100 other countries are signatories, is a specialized agency of the United Nations that sets international environmental standards applicable to vessels operating under the flag of any signatory country.
Matson further contributes positively to the environment by testing and deploying leading technologies as the fleet is modernized. ​ The International Maritime Organization (“IMO”), of which the U.S. and over 150 other countries are members, is a specialized agency of the United Nations that sets international environmental standards applicable to vessels operating under the flag of any member state.
The vessels continue to Ningbo and Shanghai, China, where they are loaded with cargo to be discharged primarily in Long Beach, California at a Matson-exclusive terminal operated by SSAT. These vessels also carry cargo destined for Hawaii which originated in Guam, Micronesia, Okinawa, China and other Asian countries.
The vessels then continue on to Ningbo and Shanghai, China, where they are loaded with cargo to be discharged primarily in Long Beach, California at a Matson-exclusive terminal operated by SSAT. These vessels also carry cargo destined for Hawaii which originated in Guam, Micronesia, Okinawa, China and other Asian countries. ​ Matson operates a second expedited service to the U.S.
The Company also provided approximately 2,200 hours of employee training and professional development opportunities, and tuition reimbursement programs, while giving annual performance reviews to its non-union workforce. ​ For more information on Matson’s human capital programs, see our Sustainability Report which is available at www.matson.com/sustainability . ​ 12 Table of Contents Bargaining Agreements: ​ Matson’s shoreside and seagoing employees are represented by a variety of unions.
The Company also provided nearly 3,000 hours of employee training and professional development training, and tuition reimbursement programs, while giving annual performance reviews to its non-union workforce. ​ For more information on Matson’s human capital programs, see Matson’s Sustainability Report which is available at https:// www.matson.com/sustainability . ​ 11 Table of Contents Bargaining Agreements: ​ Matson’s shoreside and seagoing employees are represented by a variety of unions.
Southbound cargo from Alaska primarily consists of seafood, household goods and automobiles. 2 Table of Contents ​ Matson’s Alaska-Asia Express (“AAX”) service provides carriage of seafood primarily from Kodiak and Dutch Harbor, Alaska to many locations in Asia via its transshipment ports of Ningbo and Shanghai, China, and Busan, South Korea.
Southbound cargo from Alaska primarily consists of seafood, household goods and automobiles. ​ Matson’s Alaska-Asia Express (“AAX”) service provides carriage of seafood primarily from Kodiak and Dutch Harbor, Alaska to many locations in Asia via Matson’s transshipment ports of Shanghai and Ningbo, China.
Matson’s ocean transit time, frequent sailing and reliable on-time performance provides an industry-leading service to its customers. ​ Japan Service: Matson’s Japan service has one major competitor, APL, which operates a U.S. flagged containership service from the U.S.
West Coast terminals and reliable on-time performance provides an industry-leading service to its customers. ​ Japan Service: Matson’s Japan service has one major competitor, APL, which operates a U.S. flagged containership service from the U.S.
For additional information on Ocean Transportation revenues for the years ended December 31, 2023, 2022 and 2021, see Note 2 to the Consolidated Financial Statements in Item 8 of Part II below. ​ Seasonality: ​ Historically, Matson’s Ocean Transportation services have typically experienced seasonality in volume, generally following a pattern of increasing volume starting in the second quarter of each year, culminating in a peak season throughout the third quarter, with subsequent decline in demand during the fourth and first quarters.
For additional information on Ocean Transportation revenues for the years ended December 31, 2024, 2023 and 2022, see Note 2 to the Consolidated Financial Statements in Item 8 of Part II below. ​ Seasonality: ​ Historically, Matson’s Ocean Transportation services have typically experienced seasonality in volume, generally following a pattern of increasing volume starting in the second quarter of each year culminating in the early part of the fourth quarter.
Additional projects for the second phase relate to improvements to its existing backup power generators, installation of new above ground fuel storage tanks and other upgrades at the terminal, and are expected to be completed within the next three years. ​ The third phase represents a broader and long-term terminal expansion program at the Sand Island terminal facility.
Additional projects for the second phase relate to improvements to its existing backup power generators and other terminal upgrades, which are expected to be completed within the next two years. ​ The third phase represents a broader and long-term expansion program at the Sand Island terminal facility.
The Company’s success depends in part on employing a diverse, talented and engaged workforce that reflects its local communities, supports an environment of high standards and performance, and thrives in the Company’s collaborative and respectful culture. ​ During 2023, Matson had 4,315 employees worldwide, of which 158 employees were based in international locations and 3,012 employees were covered by collective bargaining agreements with unions.
The Company’s success depends in part on employing a diverse, talented and engaged workforce that reflects its local communities, supports an environment of high standards and performance, and thrives in the Company’s collaborative and respectful culture. ​ 10 Table of Contents As of December 31, 2024, Matson had 4,356 employees worldwide, of which 161 employees were based in international locations and 3,017 employees were covered by collective bargaining agreements with unions.
From 2024 to 2025, Matson expects to perform surveying, planning and design work in preparation for this expansion. ​ Ocean Transportation Equipment: ​ As a complement to its fleet of vessels, Matson owns a variety of equipment including cranes, terminal equipment, containers and chassis, which represents an investment of approximately $0.8 billion as of December 31, 2023.
Matson is currently performing surveying, planning and design work in preparation for this expansion. ​ Ocean Transportation Equipment: ​ As a complement to its fleet of vessels and barges, Matson owns a variety of equipment including terminal cranes and equipment, containers, chassis and other property which represents an investment of approximately $0.9 billion as of December 31, 2024.
Matson expects to expand into Pier 51A and portions of Pier 51B after Pasha Hawaii (“Pasha”) relocates to the newly constructed Kapalama container terminal (“KCT”) facility in 2025.
Matson expects to expand into Pier 51A and portions of Pier 51B after Pasha Hawaii (“Pasha”) relocates to, and is operational at, the Kapalama Container Terminal (“KCT”) facility in late 2025 or early 2026.
There are also other several foreign carriers that call at Guam from foreign origin ports, and air freight carriers. ​ Matson offers customers a weekly service to Guam as part of the CLX service from three ports on the U.S. West Coast.
There are also multiple foreign carriers that call at Guam from foreign origin ports, and air freight carriers. ​ Matson offers customers a weekly sailing to Guam as part of the CLX service from three ports on the U.S. West Coast. Matson’s ocean transit times, best-in-class services from all three U.S.
Matson Logistics has supply chain operations in North America, China and other locations. ​ Operating Costs: ​ Matson Logistics’ operating costs primarily consist of the costs of purchased transportation, leases of warehouses, cross-dock and other facility operating costs, salaries and benefits, and other operating overhead. ​ Competition: ​ Matson Logistics competes with hundreds of local, regional, national and international companies that provide transportation and third-party logistics services.
Matson Logistics has supply chain operations in North America, China, Southeast Asia and other locations. ​ Operating Costs: ​ Matson Logistics’ operating costs include transportation costs, transportation brokerage expenses, agency commissions, leases of warehouses, cross-dock and other facility operating costs, wages and other related costs, and other operating overhead. ​ Competition: ​ Matson Logistics competes with hundreds of local, regional, national and international companies that provide transportation and third-party logistics services.
CII measures how efficiently a ship transports goods, and uses actual CO 2 emissions to determine an annual rating. For ships that are not in compliance, a corrective action plan needs to be developed as part of the vessels’ Ship Energy Efficiency Management Plan (“SEEMP”) and approved. The Company believes that its vessels are currently in compliance with these regulations.
CII measures how efficiently a ship transports goods, and uses calculated carbon dioxide (“CO 2 ”) emissions to determine an annual rating. For ships that are not in compliance, a corrective action plan needs to be developed as part of the vessels’ Ship Energy Efficiency Management Plan (“SEEMP”) and approved by port state authorities.
West Coast, including three facilities dedicated for MatNav’s use, in Long Beach and Oakland, California and in Tacoma, Washington. ​ Matson utilizes the services of other third-party terminal operators at all of the other ports where its vessels are served. ​ Vessel Management Services: ​ Matson contracts with the U.S.
West Coast, including three facilities dedicated for MatNav’s use, in Long Beach and Oakland, California and in Tacoma, Washington. ​ Matson utilizes the services of other third-party terminal operators at the other ports where its vessels are served. ​ ​ ​ 3 Table of Contents Vessel Information: ​ Vessels: ​ Matson’s fleet includes both owned and chartered vessels and barges.
Since January 1, 2015, U.S. Environmental Protection Agency regulations have reduced the fuel oil maximum sulfur content in designated ECAs.
Environmental Protection Agency regulations have reduced the fuel oil maximum sulfur content in designated ECAs to ≤0.1 percent.
Each billet corresponds to a position on a vessel that typically is filled by two or more employees because seagoing personnel rotate between active sea-duty and time ashore. These amounts exclude billets related to Matson’s foreign-flagged chartered vessels where the vessel owner is responsible for its seagoing personnel.
Each billet corresponds to a position on a vessel that typically is filled by two or more employees because seagoing personnel rotate between active sea-duty and time ashore.
Matson also provides weekly connecting service from Guam to the Commonwealth of the Northern Mariana Islands. Cargo destined to Guam mainly includes dry containers of mixed commodities, refrigerated containers of food, beverages, retail merchandise, building materials, and household goods. ​ Japan Service: Matson’s Japan service provides weekly carriage between the U.S.
Cargo destined to Guam mainly includes dry containers of mixed commodities, refrigerated containers of food, beverages, retail merchandise, building materials and household goods. ​ Japan Service: Matson’s Japan service provides weekly carriage between the U.S. West Coast and the port of Naha in Okinawa, Japan, as part of its CLX service.
The majority of Matson’s owned vessels are U.S. flagged and Jones Act qualified vessels, and operate in Matson’s Hawaii, China, Guam, Japan, Micronesia and Alaska services.
Matson’s owned fleet represents an investment of approximately $2.5 billion. The majority of Matson’s owned fleet is made up of U.S. flagged and Jones Act qualified vessels that operate in Matson’s Hawaii, China, Guam, Japan, Micronesia and Alaska services.
Freight rates can be impacted by these seasonality trends as well as macro supply and demand variables. ​ Relatively high inflation and the impact of high interest rates on household discretionary income may affect the demand for consumer goods in our markets, which could impact seasonal variability and demand for the Company’s Ocean Transportation services in 2024. ​ Maritime Laws and the Jones Act : ​ Maritime Laws: All interstate and intrastate marine commerce within the U.S. falls under the Merchant Marine Act of 1920 (commonly referred to as the Jones Act). ​ The Jones Act is a long-standing cornerstone of U.S. maritime policy.
Freight rates can be impacted by these seasonality trends as well as macro supply and demand variables. ​ Maritime Laws and the Jones Act : ​ Maritime Laws: All interstate and intrastate marine commerce within the U.S. falls under the Merchant Marine Act of 1920 (commonly referred to as the Jones Act). ​ The Jones Act is a long-standing cornerstone of U.S. maritime policy.
West Coast and the port of Naha in Okinawa, Japan, as part of its CLX service. This service mainly carries general sustenance cargo in both dry and refrigerated containers and household goods supporting the U.S. military. ​ Micronesia Service: Matson’s Micronesia service provides carriage between the U.S.
This service mainly carries freight supporting the U.S. government including general sustenance cargo in both dry and refrigerated containers and household goods. ​ Micronesia Service: Matson’s Micronesia service provides carriage between the U.S.
In addition, since August 1, 2012, the California Air Resources Board has reduced the fuel oil maximum sulfur content to ≤0.1 percent within 24 miles of the California coastline. ​ All of Matson’s vessels are designed to operate in compliance with current IMO and ECA regulations as applicable.
In addition, since August 1, 2012, the California Air Resources Board has reduced the fuel oil maximum sulfur content to ≤0.1 percent within 24 miles of the California coastline. ​ Matson’s vessels are designed to operate in compliance with current IMO and ECA regulations as applicable. ​ 5 Table of Contents Beginning in 2023, IMO regulations require containerships operating internationally with over 5,000 gross tonnage to comply with annual Carbon Intensity Indicator (“CII”) requirements that become increasingly stringent towards 2030.
Matson purchases fuel oil, lubricants and gasoline for its operations and pays fuel-related surcharges to other third-party transportation providers. ​ 6 Table of Contents Operating Overhead includes equipment repair costs, equipment lease and repositioning expenses, vessel repair and maintenance costs, depreciation and dry-docking amortization, insurance, port engineers and other maintenance costs, and other vessel and shoreside related overhead. ​ Competition: ​ The following is a summary of major competitors in Matson’s Ocean Transportation segment: ​ Hawaii Service: Matson’s Hawaii service has one major U.S. flagged Jones Act competitor, Pasha, which operates container and roll-on/roll-off services between the ports of Long Beach, Oakland and San Diego, California to Hawaii.
Matson also leases containers, chassis and other equipment under various operating lease agreements. ​ Operating Costs: ​ Major components of Matson’s Ocean Transportation operating costs are as follows: ​ Direct Cargo Expense includes terminal handling costs including labor and wharfage, outside purchased transportation and other related costs. ​ Vessel Operating Expense includes crew wages and related costs; fuel; pilots, tugs, lines and related costs; vessel charter expenses; and other vessel operating related expenses. ​ Operating Overhead Expense includes vessel repair and maintenance costs, inactive vessel costs, dry-docking amortization, equipment lease costs, equipment repair costs, insurance, port engineers and other maintenance costs, and other vessel and shoreside related overhead and other indirect costs. ​ Competition: ​ The following is a summary of major competitors in Matson’s Ocean Transportation segment: ​ Hawaii Service: Matson’s Hawaii service has one major U.S. flagged Jones Act competitor, Pasha, which operates container and roll-on/roll-off services between the ports of Long Beach, Oakland and San Diego, California to Hawaii.
The Company also provides a barge service between Dutch Harbor and Akutan in Alaska. Matson is the only Jones Act containership operator providing service to Kodiak and Dutch Harbor in Alaska, which are the primary loading ports for southbound seafood.
Matson is the only Jones Act containership operator providing service to Kodiak and Dutch Harbor in Alaska, which are the primary loading ports for southbound seafood. Matson offers dedicated terminal services at the Alaska ports of Anchorage, Kodiak and Dutch Harbor performed by Matson, and at the port of Tacoma, Washington performed by SSAT.
Repeal of the Jones Act would allow foreign-flagged vessel operators that do not have to abide by all U.S. laws and regulations to sail between U.S. ports in direct competition with Matson and other U.S. domestic operators that must comply with all such laws and regulations. ​ Other U.S. maritime laws require vessels operating between Guam, a U.S. territory, and U.S. ports to be U.S. flagged and predominantly U.S. crewed, but not U.S. built. ​ Cabotage laws are not unique to the United States, and similar laws exist around the world in over 90 countries, including regions in which Matson provides ocean transportation services.
AMP seeks to inform elected officials and the public about the economic, national security, commercial, safety and environmental benefits of the Jones Act and similar cabotage laws. ​ Other U.S. maritime laws require vessels operating between Guam, a U.S. territory, and U.S. ports to be U.S. flagged and predominantly U.S. crewed, but not U.S. built. ​ 8 Table of Contents Cabotage laws are not unique to the United States, and similar laws exist around the world in over 90 countries, including regions in which Matson provides ocean transportation services.
Other competitors include air freight carriers and over-the-road trucking services. Matson’s AAX service has two primary competitors, CMA CGM and Maersk Lines, which provide services between Dutch Harbor, Alaska and Asia. ​ Matson offers customers twice weekly scheduled service from Tacoma, Washington to Anchorage and Kodiak, Alaska, and a weekly service to Dutch Harbor, Alaska.
The primary competitor of Matson’s AAX service is CMA CGM, which provides services between Dutch Harbor, Alaska and Asia. ​ Matson offers customers twice weekly scheduled service from Tacoma, Washington to Anchorage and Kodiak, Alaska, and a weekly service to Dutch Harbor, Alaska. The Company also provides a barge service between Dutch Harbor and Akutan in Alaska.
West Coast and the islands of Kwajalein, Ebeye and Majuro in the Republic of the Marshall Islands, the islands of Yap, Pohnpei, Chuuk and Kosrae in the Federated States of Micronesia, and the Republic of Palau.
West Coast and the islands of Kwajalein, Ebeye and Majuro in the Republic of the Marshall Islands, the islands of Yap, Pohnpei, Chuuk and Kosrae in the Federated States of Micronesia, and the Republic of Palau. Cargo destined for these locations is transshipped through Guam and consists mainly of general sustenance cargo, building materials, hardware and retail merchandise.
The barge operators have historically shipped lower value commodities that can accommodate a longer transit time, as well as construction materials and other cargo that are not conducive to movement in containers. Foreign-flagged vessels provide alternatives for companies shipping cargo (mainly seafood) from the Alaska ports of Kodiak and Dutch Harbor to international destinations.
The barge operators have historically shipped lower value commodities that can accommodate a longer transit time, as well as construction materials and other cargo that are not conducive to movement in containers. Other competitors include air freight carriers and over-the-road trucking services.
In 2023, over half of Matson promotions in management roles were women and/or diverse individuals. ​ Matson is also focused on supporting a more inclusive talent pool over the long-term by encouraging historically underrepresented groups such as women and diverse individuals to pursue careers in the maritime and logistics sectors.
The Company utilizes both internal and external learning and development programs to encourage and promote career opportunities for all employees. Matson is also focused on supporting a more diverse talent pool over the long-term by encouraging historically underrepresented groups to pursue careers in the maritime and logistics sectors.
In 2023, 41 percent of open positions were filled through internal promotions.
In 2024, 49 percent of open positions were filled with internal candidates.
The CLX+ service primarily uses chartered vessels and operates weekly from Ningbo and Shanghai, China where they are loaded with cargo to be discharged primarily at Long Beach, California, calling at an SSAT-operated terminal.
The MAX service primarily uses chartered vessels and operates weekly from Ningbo and Shanghai, China where they are loaded with cargo to be discharged primarily at Long Beach, California, calling at an SSAT-operated terminal. ​ Both services also carry transshipment cargo originating in many locations throughout Asia, including Vietnam and Southern China to the U.S. via Shanghai, China. ​ Eastbound cargo from China to Long Beach, California consists mainly of e-commerce related goods, garments, consumer electronics, footwear and other merchandise. ​ Guam Service: Matson’s Guam service provides weekly carriage between the U.S.
Actual and future vessel construction progress milestone payments based on signed agreements and change orders, excluding vessel steel price adjustments, owners’ items and capitalized interest, are expected to be as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Paid ​ Future Milestone Payments ​ ​ ​ Vessel Construction Obligations (in millions) As of December 31, 2023 2024 2025 2026 2027 2028 Thereafter Total Three Aloha Class Containerships ​ $ 99.9 ​ $ 71.0 ​ $ 367.1 ​ $ 323.0 ​ $ 132.0 ​ $ 6.0 ​ $ — ​ $ 999.0 ​ Matson is also installing tanks, piping and cryogenic equipment on existing Aloha Class vessels so that they can operate on LNG, conventional and alternative fuels.
Actual and future vessel construction progress milestone payments based on signed agreements and change orders, excluding vessel steel price adjustments, owners’ items and capitalized interest, are expected to be as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Paid ​ Future Milestone Payments ​ ​ ​ Vessel Construction Obligations (in millions) As of December 31, 2024 2025 2026 2027 2028 Thereafter Total Three Aloha Class Containerships ​ $ 189.5 ​ $ 290.3 ​ $ 313.6 ​ $ 185.0 ​ $ 22.2 ​ $ 2.9 ​ $ 1,003.5 ​ The three new Aloha Class vessels represent an important step towards Matson’s medium-term greenhouse gas (“GHG”) emissions goal to reduce Scope 1 GHG emissions from its owned fleet by 40% by 2030, using 2016 as a baseline year.
(6) Foreign-flagged vessel. (7) Vessel installed with exhaust gas cleaning systems (commonly referred to as “scrubbers”).
Some vessel charter agreements include options for the Company to further extend the charter period. (4) U.S. flagged and Jones Act qualified vessel or barge. (5) U.S. flagged vessel or barge. (6) Foreign-flagged vessel. (7) Vessel installed with exhaust gas cleaning systems (commonly referred to as “scrubbers”).
Cargo destined for these locations is transshipped through Guam and consists mainly of general sustenance cargo, building materials, hardware and retail merchandise. ​ Alaska Service: Matson’s Alaska service provides ocean carriage between the port of Tacoma, Washington, and the ports of Anchorage, Kodiak and Dutch Harbor, Alaska.
The service to Kwajalein is provided by a U.S. flag vessel or barge. ​ Alaska Service: Matson’s Alaska service provides ocean carriage between the port of Tacoma, Washington, and the ports of Anchorage, Kodiak and Dutch Harbor, Alaska.
This included continuing its efforts to analyze pay among various employee groups to confirm pay equity across the Company. ​ As part of its overall DE&I strategy, Matson continues to focus on developing and promoting equal employment opportunities, particularly for leadership positions.
These amounts exclude billets related to Matson’s foreign-flagged chartered vessels where the vessel owner is responsible for its seagoing personnel. ​ As part of its overall human capital strategy, Matson continues to focus on developing and promoting equal employment opportunities, particularly for leadership positions.
For additional information on Logistics revenues for the years ended December 31, 2023, 2022 and 2021, see Note 2 to the Consolidated Financial Statements in Item 8 of Part II below. ​ 10 Table of Contents Seasonality: ​ In general, Matson Logistics’ services are not significantly impacted by seasonality factors, with the exception of its freight forwarding service to Alaska which may be affected by winter weather and the seasonal nature of the tourism industry. ​ ​ C.
For additional information on Logistics revenues for the years ended December 31, 2024, 2023 and 2022, see Note 2 to the Consolidated Financial Statements in Item 8 of Part II below. ​ Seasonality: ​ Matson Logistics’ businesses experience seasonality in demand for their services as follows: (i) Transportation Brokerage Services generally sees elevated truckload and intermodal shipment activity starting in the second quarter of each year, culminating in a peak season throughout the third quarter; (ii) Freight Forwarding Services experiences seasonal trends similar to Matson’s Ocean Transportation Alaska service; and (iii) Supply Chain Management and Other Services demand is generally stronger in the second and third quarters similar to Matson’s Ocean Transportation China service. ​ ​ C.
Removed
Matson provides container transshipment services from many locations in Asia including Southern China, Hong Kong, Vietnam and Xiamen, China to the United States via Shanghai. ​ Matson operates a second expedited service to the U.S. West Coast with the China-Long Beach Express Plus (“CLX+”) service.
Added
West Coast with the Matson Asia Express (“MAX”) service.
Removed
On February 18, 2024, the Company renamed the CLX+ service to Matson Asia Express (“MAX”). ​ Eastbound cargo from China to Long Beach, California consists mainly of garments, e-commerce related goods, consumer electronics, footwear and other merchandise. ​ Guam Service: Matson’s Guam service provides weekly carriage between the U.S. West Coast and Guam, as part of its CLX service.
Added
West Coast and Guam, as part of its CLX service. Matson also provides weekly U.S. flag barge service connecting Guam to the Commonwealth of the Northern Mariana Islands.
Removed
Department of Transportation to provide vessel management services to manage and maintain three Ready Reserve Force vessels on behalf of the U.S. Department of Transportation Maritime Administration (“MARAD”). ​ ​ 3 Table of Contents Vessel Information: ​ Vessels: ​ Matson’s fleet includes both owned and chartered vessels. Matson’s owned vessels represent an investment of approximately $2.3 billion.
Added
Twenty-foot Equivalent Units (“TEU”) is a standard measure of cargo volume correlated to a standard 20-foot dry cargo container. Actual loadable containers may vary from these amounts. (2) Operating speed of the vessel may vary from the Vessel Design Speed. (3) Charter expiration dates represent the approximate month the vessel can be returned to its owner.
Removed
(2) Actual operating speed of the vessel may vary from the Vessel Design Speed. (3) Charter expiration date represents the approximate earliest month the vessel can be returned to its owner. Some vessel charter agreements include options for the Company to further extend the charter period. (4) U.S. flagged and Jones Act qualified vessel or barge. (5) U.S. flagged vessel.
Added
The Company believes that its vessels are currently in compliance with these regulations.
Removed
The LNG installation project on Daniel K. Inouye was completed in the third quarter of 2023 at a total cost of approximately $47 million. LNG installation work on Kaimana Hila is currently scheduled to begin during the second quarter of 2024, and the total cost is expected to be approximately $47 million.
Added
Foreign-flagged vessels provide alternatives for companies shipping cargo (mainly seafood) from the Alaska ports of Kodiak and Dutch Harbor to international destinations.
Removed
Additionally, in the third quarter of 2023, the Company commenced the reengining of Manukai to operate on LNG, conventional and alternative fuels and the total cost is expected to be approximately $72 million. ​ The three new Aloha Class vessels and LNG installation projects are important steps towards achieving Matson’s medium-term greenhouse gas (“GHG”) emissions goal which is to reduce Scope 1 GHG emissions from its owned fleet by 40% by 2030, using 2016 as a baseline year.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

54 edited+5 added−9 removed75 unchanged
Biggest changeAdditionally, the global macroeconomic effects of the COVID-19 pandemic and related impacts on the Company’s customers’ business operations, including financial difficulties or bankruptcies, may continue to persist for an indefinite period. ​ The Company’s significant operating agreements and leases could be renewed/replaced on less favorable terms or may not be renewed/replaced on acceptable terms, if at all. ​ The significant operating agreements and leases entered into by the Company in the course of its operations, including those related to terminals, chartered vessels and warehouses as well as those with SSAT, expire at various points in time and may not be renewed/replaced with comparable assets with the specifications necessary for the Company’s or SSAT’s businesses or could be renewed/replaced on less favorable terms, if at all, thereby adversely affecting the Company’s future financial position, results of operations and cash flows. ​ The Company may face unexpected dry-docking or repair costs for its vessels. ​ The Company routinely engages shipyards to dry-dock its vessels for regulatory compliance and to provide repair and maintenance.
Biggest changeActual or threatened public health crises can have a number of adverse impacts, including volatility in the global economy, impacts to the Company’s customers’ business operations, reduced tourism in the markets the Company serves, potential restrictions on employee travel, or significant disruptions in ocean-borne transportation of goods, logistics demand and supply chain activity, caused by a variety of factors such as quarantines, factory and office closures, port closures, or other government-imposed restrictions, any of which can adversely impact the Company’s business, financial condition, operating results and cash flows. ​ The Company’s significant operating agreements and leases could be renewed/replaced on less favorable terms or may not be renewed/replaced on acceptable terms, if at all. ​ The significant operating agreements and leases entered into by the Company in the course of its operations, including those related to terminals, chartered vessels, bonded and unbonded container yards, cross-dock facilities, warehouses and offices as well as those entered into with SSAT, expire at various points in time and may not be renewed/replaced with comparable assets with the specifications necessary for the Company’s or SSAT’s businesses or could be 17 Table of Contents renewed/replaced on less favorable terms, if at all, thereby adversely affecting the Company’s future financial position, results of operations and cash flows. ​ The Company may face unexpected dry-docking or repair costs for its vessels. ​ The Company routinely engages shipyards to dry-dock its vessels for regulatory compliance and to provide repair and maintenance, and capital enhancements.
The entry of a new competitor or the addition of new vessels or capacity by existing competitors on any of the Company’s routes could result in a significant increase in available shipping capacity that could have an adverse effect on the Company’s volumes and rates. ​ The loss of or damage to key customer relationships may adversely affect the Company’s business. ​ The Company’s businesses are dependent on their relationships with customers and derive a significant portion of their revenues from the Company’s largest customers.
The entry of a new competitor or the addition of new vessels or capacity by existing competitors on any of the Company’s existing routes could result in a significant increase in available shipping capacity that could have an adverse effect on the Company’s volumes and rates. ​ The loss of or damage to key customer relationships may adversely affect the Company’s business. ​ The Company’s businesses are dependent on their relationships with customers and derive a significant portion of their revenues from the Company’s largest customers.
Even if suitable candidates are identified, such transactions may result in regulatory scrutiny, litigation and difficulties in assimilating acquired assets or companies, and may result in the diversion of the Company’s capital and its management attention from other business issues and opportunities.
Even if suitable candidates are identified, such transactions may result in regulatory scrutiny, litigation or difficulties assimilating acquired assets or companies, and may result in the diversion of the Company’s capital and its management attention from other business issues and opportunities.
Such an event could result in the Company’s ineligibility to engage in coastwise trade and the imposition of substantial penalties against the Company, including seizure or forfeiture of its vessels. ​ Risks Related to the Company’s Operations ​ Changes in macroeconomic conditions, geopolitical developments, or governmental policies, including due to outbreaks of disease, have affected and could in the future affect the Company. ​ The transportation industry in which the Company operates has been and could in the future be impacted by macroeconomic fluctuations, volatility, downturns, inflation, recessions, rising interest rates and other economic shifts or market instabilities, including due to outbreaks of disease and instability in financial institutions, as well as the development of and changes in governmental policies, relations, priorities and budgeting constraints, and uncertainties resulting from the U.S. political environment, including increased political polarization and the potential for political gridlock (such as the prospect of a shutdown of the U.S. federal government), and geopolitical developments across the jurisdictions in which it operates.
Such an event could result in the Company’s ineligibility to engage in coastwise trade and the imposition of substantial penalties against the Company, including seizure or forfeiture of its vessels. ​ Risks Related to the Company’s Operations ​ Changes in macroeconomic conditions, geopolitical developments, or governmental policies, including due to outbreaks of disease, have affected and could in the future affect the Company. ​ The transportation industry in which the Company operates has been and could in the future be impacted by macroeconomic fluctuations, volatility, downturns, inflation, recessions, interest rates and other economic shifts or market instabilities, including due to outbreaks of disease and instability in financial institutions, as well as the development of and changes in governmental policies, relations, priorities and budgeting constraints, and uncertainties resulting from the U.S. political environment, including increased political polarization and the potential for political gridlock (such as the prospect of a shutdown of the U.S. federal government), and geopolitical developments across the jurisdictions in which it operates.
Significant delays in the delivery of the new vessels could limit our ability to replace aging vessels in the Alaska service without substantial modifications and delay the Company’s ability to upsize the CLX service, which could also have an adverse impact on our business plans, financial condition and results of operations. ​ The Company’s operations are susceptible to weather, natural disasters, maritime accidents, spill events and other physical and operating risks, including those arising from climate change. ​ As a maritime transportation company, the Company’s operations are vulnerable to delay, disruptions and loss of life and property as a result of weather, natural disasters and other climate-driven events, such as rising temperatures and heat waves, rising sea levels, bad weather at sea (including increased storm severity), lightning strikes, wildfires, lava flows, hurricanes, typhoons, tsunamis, droughts, windstorms, floods and earthquakes.
Significant delays in the delivery of the new vessels could limit our ability to replace aging vessels in the Alaska service without substantial modifications and delay the Company’s ability to upsize the CLX service, which could also have an adverse impact on our business plans, financial condition and results of operations. ​ The Company’s operations are susceptible to weather, natural disasters, risks arising from climate change, maritime accidents, spill events and other physical and operating risks. ​ As a maritime transportation company, the Company’s operations are vulnerable to delay, disruptions and loss of life and property as a result of weather, natural disasters and other climate-driven events, such as rising temperatures and heat waves, rising sea levels, bad weather at sea (including increased storm severity), lightning strikes, wildfires, lava flows, hurricanes, typhoons, tsunamis, droughts, windstorms, floods and earthquakes.
The Company’s practices, policies and other efforts, including as described in Part I, Item 1C of this Annual Report on Form 10-K, may not be sufficient to prevent, detect or remediate all cybersecurity risks or other disruptions, and the Company and its service providers have in the past experienced and may in the future experience cybersecurity incidents, disruptions, threats and vulnerabilities such as malware (including computer viruses and ransomware), software bugs, denial-of-service (“DoS”) attacks, phishing, spoofing, identity-based attacks, code injection attacks, cyber terrorism, sabotage, circumvention of security systems (whether physical or virtual), malfeasance, breaches due to employee error, natural disasters, accidents, power disruptions or loss, telecommunications failure, unauthorized access or other catastrophic events or failures at the Company’s facilities, aboard its vessels or at third-party locations. ​ Any failure, breach or unauthorized access to the Company’s systems or those of third parties on which the Company relies could result in the loss of confidential, sensitive or proprietary information, interruptions in its service or production or otherwise impact the Company’s ability to conduct business operations, and could result in potential reductions in revenue and profits, damage to its reputation or liability. ​ Risks Related to Financial Matters ​ A deterioration of the Company’s credit profile, disruptions of the credit markets or higher interest rates could restrict its ability to access the debt capital markets or increase the cost of debt. ​ Deterioration in the Company’s credit profile may have an adverse effect on the Company’s ability to access the private or public debt markets and also may increase its borrowing costs.
The Company’s practices, policies and other efforts, including as described in Part I, Item 1C of this Annual Report on Form 10-K, may not be sufficient to prevent, detect or remediate all cybersecurity risks or other disruptions, and the Company and its service providers have in the past experienced and may in the future experience cybersecurity incidents, disruptions, threats and vulnerabilities such as malware (including computer viruses and ransomware), software bugs, denial-of-service (“DoS”) attacks, phishing, spoofing, identity-based attacks, code injection attacks, cyber terrorism, sabotage, circumvention of security systems (whether physical or virtual), malfeasance, breaches due to employee error, natural disasters, accidents, power disruptions or loss, telecommunications failure, unauthorized access or other catastrophic events or failures at the Company’s facilities, aboard its vessels or at third-party locations. ​ Any failure, breach or unauthorized access to the Company’s systems or those of third parties on which the Company relies could result in the loss of confidential, sensitive or proprietary information, interruptions in its service or production or otherwise impact the Company’s ability to conduct business operations, and potentially could result in reductions in revenue and profits, damage to its reputation or liability. ​ Risks Related to Financial Matters ​ A deterioration of the Company’s credit profile, disruptions of the credit markets or higher interest rates could restrict its ability to access the debt capital markets or increase the cost of debt. ​ Deterioration in the Company’s credit profile may have an adverse effect on the Company’s ability to access the private or public debt markets and also may increase its borrowing costs.
Efforts to achieve or accurately track the Company’s initiatives and goals face numerous risks and may be untimely, be unsuccessful, result in additional costs or experience delays, and as a result may have an adverse impact on the Company, including its brand, reputation, financial performance and growth and stock price, and may expose the Company to increased scrutiny from the investment community as well as enforcement authorities. ​ The Company may not be timely or successful in completing its fleet upgrade initiatives, which may result in significant costs and adversely impact the Company’s ability to meet its climate goals. ​ The Company’s four new Aloha and Kanaloa class vessels include dual fuel capable engines that can run on low sulfur fuel oil or LNG.
Efforts to achieve or accurately track the Company’s initiatives and goals face numerous risks and may be untimely, be unsuccessful, result in additional costs or experience delays, and as a result may have an adverse impact on the Company, including its brand, reputation, financial performance and growth and stock price, and may expose the Company to increased scrutiny from the investment community as well as enforcement authorities. ​ The Company may not be timely or successful in completing its fleet upgrade initiatives, which may result in significant costs and adversely impact the Company’s ability to meet its climate goals. ​ The Company’s four commissioned Aloha and Kanaloa class vessels include dual fuel capable engines that can run on low sulfur fuel oil or LNG.
Disruptions to the credit markets as a result of macroeconomic, geopolitical, or financial market developments could increase the Company’s cost of capital and limit the Company’s access to capital. ​ 22 Table of Contents Failure to comply with certain restrictive financial covenants contained in the Company’s credit facilities could preclude the payment of dividends, impose restrictions on the Company’s business segments, capital resources or other activities or otherwise adversely affect the Company. ​ The Company’s credit facilities contain certain restrictive financial covenants, the most restrictive of which include a maximum ratio of debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”), a minimum ratio of EBITDA to interest expense, certain prohibitions on additional priority debt and the maintenance of minimum shareholders’ equity.
Disruptions to the credit markets as a result of macroeconomic, geopolitical, or financial market developments could increase the Company’s cost of capital and limit the Company’s access to capital. ​ Failure to comply with certain restrictive financial covenants contained in the Company’s credit facilities could preclude the payment of dividends, impose restrictions on the Company’s business segments, capital resources or other activities or otherwise adversely affect the Company. ​ The Company’s credit facilities contain certain restrictive financial covenants, the most restrictive of which include a maximum ratio of debt to earnings before interest, taxes, depreciation and amortization (“EBITDA”), a minimum ratio of EBITDA to interest expense, certain prohibitions on additional priority debt and the maintenance of minimum 21 Table of Contents shareholders’ equity.
The adoption and expansion of related legislation and regulations have also resulted and may again result in increased capital expenditures and compliance, operational and other costs to the Company. For example, the state of California has adopted new climate change disclosure requirements.
The adoption and expansion of related legislation and regulations have also resulted and may again result in increased capital expenditures and compliance, operational and other costs to the Company. For example, the state of California has adopted climate change disclosure requirements.
Furthermore, the Port of Alaska requires upgrades to its port facilities and infrastructure to improve operational safety and efficiency, accommodate modern shipping operations and improve resiliency, as well as to mitigate the risk of failure due to corrosion or loss of load bearing capacity.
Furthermore, the Port of Alaska requires upgrades to its port facilities and infrastructure to improve operational safety and efficiency, accommodate modern shipping operations and improve resiliency, as well as to mitigate the risk of failure due to corrosion, deterioration or loss of load bearing capacity.
Within the U.S., a weakening of economic drivers in Hawaii, Alaska and Guam, which include tourism, military spending, construction, personal income growth and employment, the weakening of consumer confidence, market demand, the economy in the U.S.
Within the U.S., a weakening of economic drivers in Hawaii, Alaska or Guam, which include tourism, military spending, construction, personal income growth and employment, the weakening of consumer confidence, market demand, the economy in the U.S.
All forward-looking statements made in this Form 10-K are qualified by the risks and uncertainties described below. ​ 13 Table of Contents Risks Related to the Jones Act ​ Repeal, substantial amendment, or waiver of the Jones Act or changes in its application would have an adverse effect on the Company’s business. ​ The Merchant Marine Act of 1920 (commonly referred to as the Jones Act) regulates all interstate and intrastate marine commerce within the U.S.
All forward-looking statements made in this Form 10-K are qualified by the risks and uncertainties described below. ​ 12 Table of Contents Risks Related to the Jones Act ​ Repeal, substantial amendment, or waiver of the Jones Act or changes in its application would have an adverse effect on the Company’s business. ​ The Merchant Marine Act of 1920 (commonly referred to as the Jones Act) regulates all interstate and intrastate marine commerce within the U.S.
If the Company’s information technology and communications systems experience reliability issues, integration or compatibility concerns or if the Company’s third-party providers are unable to perform effectively or experience disruptions, cyber attacks or failures, there could be an adverse impact on the availability and functioning of the Company’s information technology and communications systems, which could lead to business disruption or inefficiencies, reputational harm or loss of customers. ​ The Company’s information technology systems have in the past and may in the future be exposed to cybersecurity risks and other disruptions that could impair the Company’s ability to operate and adversely affect its business. ​ The shipping industry is a more frequent target of cyber attacks than some other industries because of the essential nature of these services.
If the Company’s information technology and communications systems experience 20 Table of Contents reliability issues, integration or compatibility concerns or if the Company’s third-party providers are unable to perform effectively or experience disruptions, cyber attacks or failures, there could be an adverse impact on the availability and functioning of the Company’s information technology and communications systems, which could lead to business disruption or inefficiencies, reputational harm or loss of customers. ​ The Company’s information technology systems have in the past and may in the future be exposed to cybersecurity risks and other disruptions that could impair the Company’s ability to operate and adversely affect its business. ​ The shipping industry is a more frequent target of cyber attacks than some other industries because of the essential nature of these services.
In addition, the Company is subject to environmental laws and regulations, including those relating to air quality initiatives at port locations; air emissions; use of shore power at California ports; wastewater discharges; management of storm water; the storage, transportation, handling, emission and disposal of solid and hazardous materials, oil and oil related products, hazardous substances and wastes; the investigation and remediation of contamination and liability for damages to the environment; health, safety and the protection of the environment and natural resources; and climate change, including any regulations, mandates or restrictions related to GHG emissions, such as a potential carbon tax, and energy use.
In addition, the Company is subject to environmental laws and regulations, including those relating to air quality initiatives at port locations; air 22 Table of Contents emissions; use of shore power at California ports; wastewater discharges; management of storm water; the storage, transportation, handling, emission and disposal of solid and hazardous materials, oil and oil related products, hazardous substances and wastes; the investigation and remediation of contamination and liability for damages to the environment; health, safety and the protection of the environment and natural resources; and climate change, including any regulations, mandates or restrictions related to GHG emissions, such as a potential carbon tax, and energy use.
Additionally, fluctuations in the price of oil could further impact the Alaskan economy, which in turn could impact the Company’s business. ​ 14 Table of Contents The shipping industry is competitive, and the Company has been and may continue to be impacted by new or increased competition. ​ The Company has faced and may continue to face new competition by established or start-up shipping operators that enter into the Company’s markets.
Additionally, fluctuations in the price of oil could further impact the Alaskan economy, which in turn could impact the Company’s business. ​ 13 Table of Contents The shipping industry is competitive, and the Company has been and may continue to be impacted by new or increased competition. ​ The Company has faced and may continue to face new competition by established or start-up shipping operators that enter into the Company’s markets.
The shipping industry is competitive with limited barriers to entry, especially in international tradelanes. Ocean carriers can shift vessels in and out of tradelanes or charter vessels to manage capacity and meet customer demands. The Company also competes with air freight carriers some of which are able to offer more attractive schedules and services, or to increase capacity.
The shipping industry is competitive with limited barriers to entry. Ocean carriers can shift vessels in and out of tradelanes or charter vessels to manage capacity and meet customer demands. The Company also competes with air freight carriers some of which are able to offer more attractive schedules and services, or to increase capacity.
In addition, if any of the multi-employer plans to which the Company contributes fails to satisfy the minimum funding requirements, the Internal Revenue Service will impose certain penalties and taxes on the Company and other contributing employers. ​ 23 Table of Contents Risks Related to Legal, Regulatory and Compliance Matters ​ As an ocean transportation and logistics services company, the Company is subject to numerous safety, environmental, and other laws and regulations that impact the Company’s operations, are costly to comply with and expose us to liability. ​ The Company, including its vessels and terminals, is subject to numerous federal, state and local laws and regulations, including those related to safety, cabotage, equipment standards and government rates.
In addition, if any of the multi-employer plans to which the Company contributes fails to satisfy the minimum funding requirements, the Internal Revenue Service will impose certain penalties and taxes on the Company and other contributing employers. ​ Risks Related to Legal, Regulatory and Compliance Matters ​ As an ocean transportation and logistics services company, the Company is subject to numerous safety, environmental, and other laws and regulations that impact the Company’s operations, are costly to comply with and expose the Company to liability. ​ The Company, including its vessels and terminals, is subject to numerous federal, state and local laws and regulations, including those related to safety, cabotage, equipment standards and government rates.
This, in turn, could adversely affect transportation volumes or rates in Alaska and adversely impact the Company’s Ocean Transportation business and Span Alaska’s freight forwarding business, particularly given the Alaskan economy’s dependence on this port for ocean cargo. ​ There is no assurance that our efforts to mitigate the impact of these risks, including from severe weather or other climate-driven events on our operations, will be effective.
This, in turn, could adversely affect transportation volumes or rates in Alaska and adversely impact the Company’s Ocean Transportation business and Span Alaska’s freight forwarding business, particularly given the Alaskan economy’s dependence on this port for ocean cargo. 16 Table of Contents ​ There is no assurance that our efforts to mitigate the impact of these risks, including from severe weather or other climate-driven events on our operations, will be effective.
The timing and expense required for repairs could be exacerbated by compliance with MARAD requirements. ​ The Company is involved in a joint venture and is subject to risks associated with joint venture relationships. ​ The Company is involved in a terminal joint venture with SSAT (and through SSAT, other joint ventures at various U.S.
The timing and expense required for repairs could be exacerbated by compliance with MARAD and Jones Act requirements. ​ The Company is involved in a joint venture and is subject to risks associated with joint venture relationships. ​ The Company is involved in a terminal joint venture with SSAT (and through SSAT, other joint ventures at various U.S.
The Company may pay a premium for an acquisition, resulting in goodwill that may later be determined to be impaired. ​ 20 Table of Contents Risks Related to Employees ​ Work stoppages or other labor disruptions caused by the Company’s unionized workers and other workers or their unions in related industries could adversely affect the Company’s operations. ​ A significant portion of Matson’s employees are covered by collective bargaining agreements.
The Company may pay a premium for an acquisition, resulting in goodwill that may later be determined to be impaired. ​ Risks Related to Employees ​ Work stoppages or other labor disruptions caused by the Company’s unionized workers and other workers or their unions in related industries could adversely affect the Company’s operations. ​ A significant portion of Matson’s employees are covered by collective bargaining agreements.
The likelihood of these risks is compounded by uncertainties regarding the reliability of renewable energy sources as well as any increased frequency of extreme weather events that may disrupt the generation or transmission of electricity. ​ In addition, compliance with new climate change requirements or regulations such as the IMO’s requirements related to EEXI and CII, may create schedule disruptions and could require Matson’s fleet to slow down if efficiency improvements or transitions to alternative fuels together are not enough to reduce GHG emissions sufficiently, thus impacting Matson’s expedited business model and competitive advantage. ​ New environmental requirements for vessel performance and operation could also require the Company to accelerate the building of new vessels, increase the construction costs for new vessels and equipment to accommodate even newer technology as it emerges while today’s technology becomes obsolete, initiate unexpected retrofit projects for existing vessels, retire older vessels earlier than expected, or render reserve vessels unusable.
The likelihood of these risks is compounded by uncertainties regarding the reliability of renewable energy sources as well as any increased frequency of extreme weather events that may disrupt the generation or transmission of electricity. ​ In addition, compliance with climate change requirements or regulations such as the IMO’s CII requirements, or any amendments, modifications or changes in the interpretation, application or enforcement of any such requirements or regulations, may create schedule disruptions and could require Matson’s fleet to slow down if efficiency improvements or transitions to alternative fuels together are not enough to reduce GHG emissions sufficiently, thus impacting Matson’s expedited business model and competitive advantage. ​ New environmental requirements for vessel performance and operation could also require the Company to accelerate the building of new vessels, increase the construction costs for new vessels and equipment to accommodate even newer technology as it emerges while today’s technology becomes obsolete, initiate unexpected retrofit projects for existing vessels, retire older vessels earlier than expected, or render reserve vessels unusable.
In addition, overcapacity in the global or transpacific ocean transportation markets, a change in the cost of goods or currency exchange rates, pressure from U.S. or foreign governments, imposition of tariffs and uncertainties regarding tariff rates or a change in international trade policies could adversely affect freight volumes and rates in the Company’s China services.
In addition, overcapacity in the global or transpacific ocean transportation markets, a change in the cost of goods or currency exchange rates, pressure from U.S. or foreign governments, imposition of or increases in tariffs and uncertainties regarding tariff policies or other changes in international trade policies could adversely affect freight volumes and rates in the Company’s China services.
Additionally, the Company’s credit agreements generally include an increase in borrowing rates if the Company’s credit profile deteriorates. Furthermore, the Company incurs interest under its revolving credit facility based on floating rates. Floating rate debt creates higher debt service requirements if market interest rates increase, as has been the case in connection with the U.S.
Additionally, the Company’s credit agreements generally include an increase in borrowing rates if the Company’s credit profile deteriorates. Furthermore, the Company incurs interest under its revolving credit facility based on floating rates. Floating rate debt creates higher debt service requirements as market interest rates increase, as was the case in connection with the U.S.
There is significant uncertainty as to when, if at all, these alternative fuels will become commercially available or viable, and whether Matson will be able to utilize or have access to these alternative fuels (or any such alternative fuels developed in the future) in a timely and cost- effective manner.
There is significant uncertainty as to when, if at all, these alternative fuels will become commercially available or viable at a reasonable cost and in sufficient quantities, and whether Matson will be able to utilize or have access to these alternative fuels (or any such alternative fuels developed in the future) in a timely and cost- effective manner.
These tensions have resulted in the implementation of tariffs, non-tariff trade barriers and sanctions, including the use of export control restrictions and sanctions against certain countries and individual companies, which have, and may continue to have, an adverse economic impact in the markets in which the Company operates and could result in a reduced demand for the Company’s services. ​ These adverse economic conditions may also impact the Company’s customers’ business levels and needs.
These tensions have resulted in the rising threat, implementation or increase of tariffs, non-tariff trade barriers and sanctions, including the use of export control restrictions and sanctions against certain countries and individual companies, which have, and may continue to have, an adverse economic impact in the markets in which the Company operates and could result in a reduced demand for the Company’s services. ​ These adverse economic conditions may also impact the Company’s customers’ business levels and needs.
A joint venture involves certain risks for the Company such as: ​ ● The Company’s lack of voting control over the joint venture, including the risk that the joint venture takes actions resulting in reputational harm to the Company; ● Misalignment or inconsistency of interests between the Company and the joint venture partner; ● Reliance on the joint venture partner to fund its share of capital or fulfill its other commitments, including the risk that the joint venture partner could become bankrupt; and ● Operating difficulties and financial losses at the joint venture, which may lead to the Company writing down assets or incurring impairment charges. ​ In addition, the Company relies on SSAT for its stevedoring services at the ports of Long Beach and Oakland, California and Tacoma, Washington on the U.S.
A joint venture involves certain risks for the Company such as: ​ ● The Company’s lack of voting control over the joint venture, including the risk that the joint venture takes actions resulting in reputational harm to the Company; ● Misalignment or inconsistency of interests between the Company and the joint venture partner; ● Reliance on the joint venture partner to fund its share of capital or fulfill its other commitments, including the risk that the joint venture partner could become bankrupt; and ● Operating difficulties and financial losses, including from abandonment or termination of terminal lease agreements, at the joint venture, which may lead to SSAT writing down assets or incurring impairment charges. ​ In addition, the Company relies on SSAT for its stevedoring services at the ports of Long Beach and Oakland, California and Tacoma, Washington on the U.S.
Employees and Labor Relations of this Annual Report. ​ Previously, the Company has been adversely affected by actions taken by employees of the Company or other companies in related industries against efforts by management of the Company or other companies to control labor costs, restrain wage or benefit increases or modify work practices.
Employees and Labor Relations of this Annual Report. ​ 19 Table of Contents Previously, the Company has been adversely affected by actions taken by employees of the Company or other companies in related industries against efforts by management of the Company or other companies to control labor costs, restrain wage or benefit increases or modify work practices.
These efforts and the Company’s reputation may also be impacted by any failure or perceived failure to meet or timely progress on publicly disclosed human capital-related goals and initiatives, including with respect to diversity, equity and inclusion, or to compare favorably with the progress or goals of its industry or peers. ​ Risks Related to Information Technology ​ If the Company is not able to use its information technology and communications systems effectively, the Company’s ability to conduct business might be negatively impacted. ​ The Company is highly dependent on the proper functioning of its information technology systems to enable operations and compete effectively.
These efforts and the Company’s reputation may also be impacted by any failure or perceived failure to meet or timely progress on publicly disclosed human capital-related goals and initiatives, or to compare favorably with the progress or goals of its industry or peers. ​ Risks Related to Information Technology ​ If the Company is not able to use its information technology and communications systems effectively, the Company’s ability to conduct business might be negatively impacted. ​ The Company is highly dependent on the proper functioning of its information technology systems to enable operations and compete effectively.
Mainland, inflation, rising interest rates, recessionary fears, increased political polarization and the potential for political gridlock (such as the prospect of a shutdown of the U.S. federal government), and the effect of a change in the strength of the U.S. dollar against other foreign currencies has reduced and could in the future reduce the demand for goods, adversely affecting inland and ocean transportation volumes or rates.
Mainland, inflation, interest rates, recession, increased political polarization and the potential for political gridlock (such as the prospect of a shutdown of the U.S. federal government), and the effect of a change in the strength of the U.S. dollar against other foreign currencies has reduced and could in the future reduce the demand for goods, adversely affecting inland and ocean transportation volumes or rates.
The Company does not maintain key person insurance on any of its key personnel. ​ The Company’s investments in and efforts to manage its human capital and maintain a desirable workplace culture, including to create a safe and healthy work environment, improve diversity and create a respectful, responsive and inclusive culture, and foster a rewarding workplace for employee development and advancement, may not be successful in identifying, attracting, developing, motivating, retaining, competing for or replacing qualified personnel.
The Company does not maintain key person insurance on any of its key personnel. ​ The Company’s investments in and efforts to manage its human capital and maintain a desirable workplace culture, including to create a safe and healthy work environment, and foster a rewarding workplace for employee development and advancement, may not be successful in identifying, attracting, developing, motivating, retaining, competing for or replacing qualified personnel.
Because the Company relies on its ability to draw on its revolving credit facility to support its operations when required, any volatility in the credit and financial markets that prevents the Company from accessing funds (for example, a lender that does not fulfill its lending obligation) could have an adverse effect on the Company’s financial condition and cash flows.
Because the Company relies on its ability to draw on its revolving credit facility to support its operations when required, any volatility or disruption in the credit and financial markets or other development that prevents the Company from accessing funds (for example, a lender that does not fulfill its lending obligation) or renewing its revolving credit facility could have an adverse effect on the Company’s financial condition and cash flows.
If the Company’s credit profile deteriorates significantly, its access to the debt capital markets or its ability to renew its committed lines of credit may become restricted, or the Company may not be able to refinance debt at the same levels or on the same terms.
If the Company’s credit profile deteriorates significantly, its access to the debt capital markets or its ability to renew its revolving credit facility and other committed lines of credit may become restricted, or the Company may not be able to refinance debt at the same levels or on the same terms.
The price and supply of fuel are unpredictable and fluctuate based on events beyond the Company’s control, including impacts from global macroeconomic conditions and geopolitical events. Increases in the price of fuel may adversely affect the Company’s results of operations.
The price and supply of fuel are difficult to predict and fluctuate based on events beyond the Company’s control, including impacts from global macroeconomic conditions and geopolitical events. Increases in the price of fuel may adversely affect the Company’s results of operations.
West Coast ports. ​ The Company is subject to risks associated with conducting business in foreign shipping markets. ​ Matson’s China, Alaska export, Micronesia, Japan and South Pacific services are subject to risks associated with conducting business in a foreign shipping market, which include: ​ ● Challenges associated with operating in foreign countries and developing relationships with foreign companies, business associates and governments, including as a result of cultural differences; ● Difficulties in staffing and managing foreign operations, including dynamic employment and immigration laws; 19 Table of Contents ● The Company’s ability to comply with U.S. and foreign legal and regulatory restrictions, including anti-corruption laws such as the Foreign Corrupt Practices Act; ● Not having continued access to existing port facilities or feeder vessels; ● The Company’s ability to manage changes in the cost of goods or currency exchange rate fluctuations; ● Geopolitical and economic instability; ● Economic downturns or slower growth in the local markets or geographic areas in which we conduct business; ● Dynamics involving U.S. trade relations with other countries, including the imposition of or uncertainty associated with the level of tariffs, non-tariff trade barriers or sanctions, including the use of export control restrictions and sanctions against certain countries and individual companies, or other governmental actions, and responsive actions taken by the Company’s customers, including with respect to their supply chains; and ● Customer preferences to diversify supply chains away from, or otherwise limit sourcing from, certain countries. ​ The Company’s terminals in Hawaii and Alaska require modernization. ​ The Company has completed the first phase of renovating and modernizing its Sand Island terminal in Honolulu Harbor.
West Coast ports. ​ The Company is subject to risks associated with conducting business in foreign markets. ​ Matson’s China service and other international services are subject to risks associated with conducting business in foreign markets, which include: ​ ● Challenges associated with operating in foreign countries and developing relationships with foreign companies, business associates and governments, including as a result of cultural differences; ● Difficulties in staffing and managing foreign operations, including dynamic employment and immigration laws; ● The Company’s ability to comply with U.S. and foreign legal and regulatory restrictions, including anti-corruption laws such as the Foreign Corrupt Practices Act; ● Not having continued access to existing port facilities or feeder vessels; ● The Company’s ability to manage changes in the cost of goods or currency exchange rate fluctuations; ● Geopolitical and economic instability; ● Economic downturns or slower growth in the local markets or geographic areas in which we conduct business; ● Dynamics involving U.S. trade relations with other countries, including the imposition or threatening of or uncertainty associated with the level , magnitude and product range of tariffs, non-tariff trade barriers or sanctions, including the use of export control restrictions and sanctions against certain countries and individual companies, or other governmental actions, and responsive actions taken by the Company’s customers, including with respect to their supply chains; 18 Table of Contents ● The Company’s ability to offer a differentiated service for which customers are willing to pay a significant premium; and ● Customer preferences to diversify supply chains away from, or otherwise limit sourcing from, certain countries. ​ The Company’s terminals in Hawaii and Alaska require modernization. ​ The Company has completed the first phase of renovating and modernizing its Sand Island terminal in Honolulu Harbor.
If the Company cannot reliably secure sufficient transportation equipment, capacity or services from these third parties at reasonable prices or rates to meet its or its customers’ needs and schedules, customers may seek to have their transportation and logistics needs met by others on a temporary or permanent basis.
If the Company cannot reliably secure sufficient transportation equipment, capacity or services from these third parties at reasonable prices or rates to meet its or its customers’ needs and schedules, or if there are changes to the costs of such services, customers may seek to have their transportation and logistics needs met by others on a temporary or permanent basis.
If these outcomes were to occur, the Company’s business, results of operations, cash flows and financial condition could be adversely affected. ​ The Company faces risks related to actual or threatened health epidemics, outbreaks of disease, pandemics or other major health crises, which could significantly disrupt the Company’s business. ​ The Company’s business could be impacted adversely by outbreaks of disease, the effects of public health epidemics, pandemics or other major heath crises (which the Company refers to collectively as public health crises).
If these outcomes were to occur, the Company’s business, results of operations, cash flows and financial condition could be adversely affected. ​ The Company faces risks related to actual or threatened health epidemics, outbreaks of disease, pandemics or other major health crises, which could significantly disrupt the Company’s business. ​ The Company’s business has in the past, and could in the future, be impacted adversely by outbreaks of disease, the effects of public health epidemics, pandemics or other major heath crises (which the Company refers to collectively as public health crises), such as the COVID-19 pandemic.
For example, the aging docks of the port are increasingly exposed to the risk of failure due to corrosion and the loss of load-bearing capacity particularly in the event of extreme seismic events or other natural disasters.
For example, the aging cranes and dock facilities of the port are increasingly exposed to the risk of failure due to corrosion, deterioration, and the loss of load-bearing capacity particularly in the event of extreme seismic events or other natural disasters.
In addition, the Company’s position as a U.S. citizen operator of Jones Act vessels would be negatively impacted if periodic efforts and attempts by foreign interests to circumvent certain aspects of the Jones Act were successful.
In addition, the Company’s position as a U.S. citizen operator of Jones Act vessels would be negatively impacted if periodic efforts and attempts by foreign interests, including recent campaigns by foreign governments, to circumvent or repeal certain aspects of the Jones Act were successful.
Furthermore, the Company’s results of operations have been and may continue to be impacted by lower contributions from SSAT, including as a result of declines in detention and demurrage revenue and lift volumes due to reduced carrier volumes into U.S.
Furthermore, the Company’s results of operations have been and may continue to be impacted by lower share of income from SSAT, including as a result of declines in lift volumes due to reduced carrier volumes into U.S.
Organizational, industrial and governmental shifts in operations as well as legal and regulatory requirements to reduce or eliminate emissions and/or increase efficiency may require the Company to increase expenditures, make changes to existing infrastructure, vessels and equipment, limit the speed at which the Company’s vessels are permitted to travel, and make other changes to its business model.
Organizational, industrial and governmental shifts in operations as well as legal and regulatory requirements to reduce or eliminate emissions and/or increase efficiency, or any amendments, modifications or changes in the interpretation, application or enforcement of any such operations or requirements, may require the Company to increase expenditures, make changes to existing infrastructure, vessels and equipment, limit the speed at which the Company’s vessels are permitted to travel, and make other changes to its business model.
As a result of these risks, the Company may not fully realize the benefits of these investments. ​ 16 Table of Contents The Company’s vessel construction agreements with Philly Shipyard subject the Company to risks. ​ On November 1, 2022, MatNav and Philly Shipyard entered into vessel construction agreements pursuant to which Philly Shipyard will construct three new 3,600-TEU Aloha Class dual-fuel capable containerships, with expected delivery dates during the fourth quarter of 2026 and subsequent deliveries currently expected in the second and fourth quarters of 2027.
As a result of these risks, the Company may not fully realize the benefits of these investments. ​ The Company’s vessel construction agreements with Philly Shipyard subject the Company to risks. ​ On November 1, 2022, MatNav and Philly Shipyard entered into vessel construction agreements pursuant to which Philly Shipyard will construct three new 3,600-TEU Aloha Class dual-fuel capable containerships, with expected delivery dates during the first quarter 2027, the third quarter 2027 and the second quarter 2028.
Affected vessels may also be removed from service and thus would be unavailable for 17 Table of Contents income-generating activity.
Affected vessels may also be removed from service and thus would be unavailable for income-generating activity.
Federal Reserve’s interest rate increases in 2022 and 2023, which could adversely affect the Company’s cash flow and results of operations.
Federal Reserve’s interest rate increases in 2022 and 2023, and high interest rates can adversely affect the Company’s cash flow and results of operations.
However, significant upgrades remain, including projects to improve resiliency, including to risks due to severe weather events, natural disasters, sea level rise and climate- change related risks. The Company is continuing discussions with state and local authorities regarding a port modernization program for the Port of Alaska.
However, significant upgrades remain, including the long-term expansion program at the Sand Island terminal and projects to improve resiliency to risks from events such as severe weather, natural disasters, sea level rise and other climate- change related risks. The Company is continuing discussions with state and local authorities regarding a port modernization program for the Port of Alaska.
Once completed, operation of these vessels may be slowed to the extent they present new maintenance requirements or unforeseen complications. ​ The Company’s investments in LNG-ready vessels, whether on their own or in addition to other Company initiatives, may be insufficient to meet the Company’s previously announced GHG emission reduction goals on a timely basis or at all.
Additional operating costs may be incurred to the extent use of LNG presents new maintenance requirements or unforeseen complications. ​ The Company’s investments in LNG-ready vessels, whether on their own or in addition to other Company initiatives, may be insufficient to meet the Company’s previously announced GHG emission reduction goals on a timely basis or at all.
Service structures and relationships with these parties are important in the Company’s intermodal business, as well as in the China, Guam, Micronesia, Japan, Alaska export and South Pacific services. ​ The loss of or damage to any of these key relationships may adversely affect the Company’s business and revenue. ​ The Company is dependent upon key vendors and third parties for equipment, capacity, facilities, infrastructure and services essential to operate its business, and if the Company fails to secure sufficient third-party services, its business could be adversely affected. ​ The Company’s businesses are dependent upon key vendors who provide terminal, rail, truck, and ocean transportation services.
The loss of or damage to any of these key relationships may adversely affect the Company’s business and revenue. ​ The Company is dependent upon key vendors and third parties for equipment, capacity, facilities, infrastructure and services essential to operate its business, and if the Company fails to secure sufficient third-party services, its business could be adversely affected. ​ The Company’s businesses are dependent upon key vendors who provide terminal, rail, truck, agent and ocean transportation services.
Such a failure could happen for a variety of reasons, including but not limited to (i) delivery delays, (ii) delivery of vessels that fail to meet any of the required operating specifications (for example, capacity, fuel efficiency or speed), (iii) events in South Korea that prevent one or more significant subcontractors to Philly Shipyard from performing, (iv) loss of key personnel at either Philly Shipyard or any of its subcontractors, (v) work stoppages or other labor disruptions that may occur as a result of the failure of Philly Shipyard to negotiate collective bargaining agreements with its unions, or (vi) the insolvency of, or the refusal or inability to perform for any reason, by Philly Shipyard or any of its subcontractors.
Such a failure could happen for a variety of reasons, including but not limited to (i) delivery delays, (ii) delivery of vessels that fail to meet any of the required operating specifications (for example, capacity, fuel efficiency or speed), (iii) events in South Korea that prevent one or more significant 15 Table of Contents subcontractors to Philly Shipyard from performing, (iv) loss of key personnel at either Philly Shipyard or any of its subcontractors, (v) work stoppages or other labor disruptions that may occur as a result of the failure of Philly Shipyard to negotiate collective bargaining agreements with its unions, (vi) the insolvency of, or the refusal or inability to perform for any reason, by Philly Shipyard or any of its subcontractors, (vii) the ability of Hanwha Ocean and Hanwha Systems (collectively, “Hanwha”) to integrate Philly Shipyard successfully into their global operations following Hanwha’s acquisition of Philly Shipyard, or (viii) delays in the construction of vessels scheduled to be completed before the Company’s vessels.
If this were to occur, the Company’s business, results of operations and financial condition could be adversely affected. ​ An increase in fuel prices, changes in the Company’s ability to collect fuel-related surcharges, and/or the cost or limited availability of required fuels may adversely affect the Company’s profits. ​ Fuel, including LNG fuels and biofuels, is a significant operating expense for the Company’s Ocean Transportation business.
The loss of or damage to any of these key relationships may also adversely affect the Company’s business and revenue. ​ An increase in fuel prices, changes in the Company’s ability to collect fuel-related surcharges, and/or the cost or limited availability of required fuels may adversely affect the Company’s profits. ​ Fuel, including LNG fuels and biofuels, is a significant operating expense for the Company’s Ocean Transportation business.
The Company’s business relies on its relationships with the U.S. military, freight forwarders and non-vessel owning common carriers, large retailers and consumer goods manufacturers, as well as other larger customers.
The Company’s business relies on its relationships with the U.S. military, freight forwarders and non-vessel owning common carriers, large retailers and consumer goods manufacturers, as well as other larger customers. For more information regarding the Company’s significant customers, see the discussion in Part I, Item 1 of this Annual Report.
The Company has completed the installation of tanks, piping and cryogenic equipment on Daniel K. Inouye to operate on LNG; begun re-engining Manukai ; and announced plans for LNG installations on Kaimana Hila in 2024. In addition, the Company has announced plans to construct three new LNG-ready Aloha Class vessels.
The Company has completed the installation of tanks, piping and cryogenic equipment on Daniel K. Inouye and Kaimana Hila and re-engined Manukai to operate on LNG. In addition, construction has begun on three new LNG-ready Aloha Class vessels. The Company has made and anticipates making significant capital expenditures in connection with these fleet initiatives.
In addition, advances in fuel technology could require Matson to incur significant capital costs to utilize any such technologies (including, for example, efforts to accelerate building of new vessels, retrofit existing vessels, retire 15 Table of Contents vessels early or make reserve vessels unusable) and Matson may be unable to equip its vessels with these technologies on a timely basis, if at all. ​ Evolving regulations and stakeholder expectations related to sustainability matters exposes the Company to heightened scrutiny, additional costs, operational challenges and a number of risks. ​ The SEC and other regulators, investors, advisory firms, employees, customers, suppliers, governments and other stakeholders are increasingly focused on and have established regulations and expectations related to sustainability matters and related corporate practices, disclosures and initiatives.
In addition, advances in fuel technology could require Matson to incur significant capital costs to utilize any such technologies (including, for example, efforts to accelerate building of new vessels, retrofit existing vessels, retire vessels early or make reserve vessels unusable) and Matson may be unable to equip its vessels with these technologies on a timely basis, if at all.
The Company regularly updates its information technology systems or implements new systems, which could cause substantial business interruption.
The Company regularly updates its information technology systems or implements new systems, which could cause substantial business interruption. There is no assurance that the systems upgrades or new systems will meet the Company’s current or future business needs, or that they will operate as designed.
If these disputes develop into proceedings, these proceedings, individually or collectively, could involve or result in significant expenditures or losses by the Company, or result in significant changes to Matson’s tariffs, rates, rules and practices in dealing with its customers. ​ 24 Table of Contents The Company may continue to be exposed to risks and unknown liabilities related to the Horizon acquisition. ​ The Company acquired Horizon subject to all of the liabilities and obligations of its non-Hawaii business, including any remaining liabilities and obligations associated with its Puerto Rico operations, which Horizon ceased during the first quarter of 2015.
If these disputes develop into proceedings, these proceedings, individually or collectively, could involve or result in significant expenditures or losses by the Company, or result in significant changes to Matson’s tariffs, rates, rules and practices in dealing with its customers. ​ ​
There is no assurance that the systems upgrades or new systems will meet the Company’s current or future business needs, or that they will operate as designed. 21 Table of Contents ​ The Company’s information technology systems also rely on third-party service providers for access to the Internet, satellite-based communications systems, the electric grid, database storage facilities and telecommunications providers.
If Matson does not appropriately adapt its operations to these new technologies as quickly or effectively as its competitors, the Company’s business could be adversely affected. ​ The Company’s information technology systems also rely on third-party service providers for access to the Internet, satellite-based communications systems, the electric grid, database storage facilities and telecommunications providers.
Removed
For more information regarding the Company’s significant customers, see the discussion in Part I, Item 1 of this Annual Report. ​ The Company could also be adversely affected by any changes in the services, or changes to the costs of services, provided by third-party vendors such as railroads, truckers, terminals, agents and shipping companies, including charter vessel owners.
Added
Moreover, some of the factors, events and contingencies discussed below may have occurred in the past, but the disclosures below are not representations as to whether or not the factors, events or contingencies have occurred in the past, and instead reflect our beliefs and opinions as to the factors, events, or contingencies that could materially and adversely affect us in the future.
Removed
The Company anticipates making significant capital expenditures in connection with these fleet initiatives. These initiatives may be hindered by substantial delays and long lead times for necessary equipment, including as a result of ongoing supply chain congestion, increased demand across the industry for LNG installations and conversions, and new ship-building.
Added
Service structures and relationships with these parties are important in the Company’s intermodal business, as well as in the China, Guam, Micronesia, Japan, Alaska export and South Pacific services.
Removed
Additional operating costs may be incurred to the extent additional ships are needed to maintain schedule integrity while such updates and installations are performed.
Added
If this were to occur, the Company’s business, results of operations and financial condition could be adversely affected.
Removed
Actual or threatened public health crises may have a number of adverse impacts, including volatility in the global economy, impacts to the Company’s customers’ business operations, reduced tourism in the markets the Company serves, potential restrictions on employee travel, or significant disruptions in ocean-borne transportation of goods, logistics demand and supply chain activity, caused by a variety of factors such as quarantines, factory and office closures, port closures, or other government-imposed restrictions, any of which could adversely impact the Company’s business, financial condition, operating results and cash flows.
Added
It is also uncertain to what extent charter vessel owners may be willing to experiment with, or make the necessary investments to utilize, alternative fuels. ​ 14 Table of Contents Evolving regulations and stakeholder expectations related to sustainability matters exposes the Company to heightened scrutiny, additional costs, operational challenges and a number of risks. ​ The SEC, the state of California, and other regulators, investors, advisory firms, employees, customers, suppliers, governments and other stakeholders are increasingly focused on and have established regulations and expectations related to sustainability matters and related corporate practices, disclosures and initiatives.
Removed
In addition, the Company’s business and operations has in the past, and could in the future, be impacted by outbreaks of disease, such as the COVID-19 pandemic.
Added
In addition, adoption of new and rapid changes in technology, such as the rise in artificial intelligence applications, may impact the transportation and logistics industry.
Removed
For instance, during the height of the COVID-19 pandemic, the Company’s operations faced risks from employees potentially being restricted from or unable to perform their duties, the Company’s or SSAT’s terminals potentially being temporarily closed, or potential outbreaks aboard the Company’s vessels that could cause the Company to miss port calls.
Removed
As the COVID-19 18 Table of Contents pandemic subsided, supply and demand trends have normalized and the high volumes and rates the Company previously experienced in its China service have declined, however, certain fixed costs remain.
Removed
The disposition of these liabilities, and any other obligations that are unknown to the Company, including contingent liabilities, could have an adverse effect on the Company’s financial condition and results of operations. ​ Pasha acquired Horizon’s former Hawaii business immediately before the Company acquired Horizon, and Pasha assumed substantially all liabilities and obligations related to Horizon’s Hawaii business and agreed to perform various covenants.
Removed
In some cases, however, Horizon, as the original contracting party, may remain primarily responsible for such assumed Hawaii liabilities and obligations. The Company may incur losses related to such assumed Hawaii liabilities and obligations. ​ ​ ITEM 1B. UNRESOLVED STAFF COMMENTS ​ None. ​ ​

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe Company’s Chief Executive Officer and Chief Financial Officer are briefed on a quarterly basis on the results of these reviews. ​ 25 Table of Contents Training, education and awareness-building are mechanisms Matson uses to help embed a strong culture of cyber and information security within its workplace.
Biggest changeThe Company’s quarterly information security update to the Chief Executive Officer and Chief Financial Officer includes an update on the results of these reviews. ​ Training, education and awareness-building are mechanisms Matson uses to help embed a strong culture of cyber and information security within its workplace.
The Chief Financial Officer and Head of Internal Audit review the Company’s risk management activities with the Audit Committee and the Board on a regular basis. Management also regularly updates the full Board at and between Board meetings on the ERM program and other risk-related matters.
The Chief Financial Officer and the head of internal a udit review the Company’s risk management activities with the Audit Committee and the Board on a regular basis. Management also regularly updates the full Board at and between Board meetings on the ERM program and other risk-related matters.
ITEM 1C. CYBERSECURITY ​ Risk management and strategy: Matson’s information security, Internal Audit and risk management teams help to identify and assess cyber and information security threats and vulnerabilities, and establish the appropriate business systems, preventive controls and risk mitigation strategies.
ITEM 1C. CYBERSECURITY ​ Risk management and strategy: Matson’s information security, internal audit, business continuity and risk management teams help to identify and assess cyber and information security threats and vulnerabilities, and establish the appropriate business systems, preventive controls and risk mitigation strategies .
In addition, the Company utilizes annual third-party audits to test its cybersecurity systems and incident response and remediation plans to help spot vulnerabilities and improve its ability to respond to unexpected events.
In addition, the Company utilizes third-party audits to test its cybersecurity systems, incident response and remediation plans to help spot vulnerabilities and improve its ability to respond to unexpected events.
Risk Factors – “ The Company’s information technology systems have in the past and may in the future be exposed to cybersecurity risks and other disruptions that could impair the Company’s ability to operate and adversely affect its business. ” ​ Governance: Matson’s Board of Directors has oversight of the Company’s risk management process, which includes overseeing our process for identifying, assessing and mitigating significant financial, operational, legal, strategic, and other risks that may affect the Company.
Risk Factors – “ The Company’s information technology systems have in the past and may in the future be exposed to cybersecurity risks and other disruptions that could impair the Company’s ability to operate and adversely affect its business. ” ​ Governance: The Board has oversight of the Company’s risk management process, which includes overseeing our process for identifying, assessing and mitigating significant financial, operational, legal, strategic, and other risks that may affect the Company.
Coast Guard Area Maritime Security Committees and Cybersecurity Subcommittees ● Cyber-Hawaii ● Maritime Transportation System Information Sharing and Analysis Center (“MTS-ISAC”) ​ In the last fiscal year, Matson has not identified risks from known cybersecurity threats, including as a result of any prior cybersecurity incidents, that have materially affected the Company, but the Company faces certain ongoing cybersecurity risks threats that, if realized, are reasonably likely to materially affect the Company.
Coast Guard Area Maritime Security Committees and Cybersecurity Subcommittees ● Cyber-Hawaii ● Maritime Transportation System Information Sharing and Analysis Center (“MTS-ISAC”) ​ Since the beginning of the last fiscal year, Matson has not identified risks from known cybersecurity threats , including as a result of any prior cybersecurity incidents, that have materially affected the Company, but the Company faces certain ongoing cybersecurity risks threats that, if realized, are reasonably likely to materially affect the Company.
The Company also has specific escalation processes and resources in place for employees to raise a concern should they notice anything suspicious. ​ The design of Matson’s vessel and office information technology systems is informed in part by the following third-party frameworks or standards: ● ISO 27001 ● NIST Cybersecurity Framework ● NIST 800-171 ● DFARS 252.204-7012 ● IMO MSC-FAL.1/Circ.3/Rev.2 ● BIMCO’s Guidelines for Cyber Security Onboard Ships ● IAPH’s Cybersecurity Guidelines for Ports and Port Facilities ​ In addition, Matson participates in the following organizations in its effort to better understand best practices and advance its systems and policies over time: ● National Security Administration (“NSA”)’s Cybersecurity Collaboration Center ● U.S.
The Company also has specific escalation processes and resources in place for employees to raise a concern should they notice anything suspicious. ​ The design of Matson’s information technology systems is informed in part by the following third-party frameworks or standards: ● ISO 27001 ● NIST Cybersecurity Framework ● NIST 800-171 ● NIST 800-82 ● DFARS 252.204-7012 ● IMO MSC-FAL.1/Circ.3/Rev.2 ● BIMCO’s Guidelines for Cyber Security Onboard Ships ● IAPH’s Cybersecurity Guidelines for Ports and Port Facilities 24 Table of Contents ​ In addition, Matson participates in the following organizations in its effort to better understand best practices and advance its systems and policies over time: ● National Security Administration (“NSA”)’s Cybersecurity Collaboration Center ● U.S.
The ERM process, which follows the Committee of Sponsoring Organization Framework, is designed to promote visibility to the Board and management of critical risks and risk mitigation strategies across various time frames, including the 26 Table of Contents short-, medium- and long- term. Risk mitigation efforts are integrated into strategic plans and budgets.
The ERM process, which follows the Committee of Sponsoring Organization Framework, is designed to promote visibility to the Board and management of critical risks and risk mitigation strategies across various time frames, including the short-, medium- and long- term. Risk mitigation efforts are integrated into strategic plans and budgets.
Senior leaders, including Matson’s Chief Information Officer, review the Company’s cybersecurity program with the Board of Directors at least annually, and the Chief Information Officer meets with the Audit Committee at least twice per year.
Senior leaders, including Matson’s Chief Information Officer, review the Company’s cybersecurity program with the Board at least annually, and the Chief Information Officer meets with the Audit Committee at least twice per year.
Matson’s information security efforts are led by its Chief Information Officer, who has over 25 years of experience in enterprise software development, infrastructure and management, including over 17 years with Matson and 7 years at Charles Schwab as Senior Manager of Middleware Security, and Senior Director, Information Security, who is a Certified Information Systems Security Professional, Certified Information Systems Auditor, and is AWS Certified.
Matson’s information security efforts are led by its Chief Information Officer, who has over 25 years of experience in enterprise software development, infrastructure and management, including over 18 years with Matson and 7 years at Charles Schwab as Senior Manager of Middleware Security, and the Chief Information Security Officer , who is a Certified Information Systems Security Professional, Certified Information Systems Auditor, and is AWS Certified.
In addition, executive sessions of the Board, which are led by the Lead Independent Director, have focused on certain risk oversight topics from time to time. The Lead Independent Director consults with the Chairman of the Board regarding risk-focused topics at Board meetings. ​ ​
In addition, executive sessions of the Board, which are led by the Lead Independent Director, have focused on certain risk oversight topics from time to time. The Lead Independent Director consults with the Chairman of the Board regarding risk-focused topics at Board meetings. ​ ​ 25 Table of Contents
The Chief Information Officer and Senior Director provide regular briefings to the Chief Executive Officer, the Chief Financial Officer, the Board of Directors, and the Audit Committee. In addition, the Corporate Compliance Committee, comprised of business unit leaders, helps oversee cybersecurity initiatives and reports twice per year to the Audit Committee.
The Chief Information Officer and the Chief Information Security Officer provide regular briefings to the Chief Executive Officer, the Chief Financial Officer, the Board, and the Audit Committee. In addition, the Corporate Compliance Committee, comprised of business unit leaders, helps oversee cybersecurity initiatives and reports twice per year to the Audit Committee.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeMaterial terminal facilities used by the Company’s Ocean Transportation segment include the following: ​ ​ ​ ​ ​ Terminal Location Acreage Honolulu, Hawaii 105 Anchorage, Alaska 38 Dutch Harbor, Alaska 18 Kodiak, Alaska 6 Tacoma, Washington ​ 15 ​ Polaris Point, Guam ​ 30 ​ The Company’s other primary terminal facilities located at the ports of Oakland and Long Beach, California, and Tacoma, Washington are leased by SSAT. ​ Other material facilities used by the Company’s Logistics segment include the following: ​ ​ ​ ​ ​ ​ ​ Other Material Facilities Description of Facility Square Footage Leased facilities: ​ ​ ​ ​ ​ Pooler, Georgia Warehouse 710,844 ​ Oakland, California Warehouse 406,463 ​ Pooler, Georgia Warehouse 324,832 ​ Oakland, California Warehouse 132,000 ​ Auburn, Washington Office / Cross-dock 51,250 ​ Owned facilities: ​ ​ ​ ​ ​ Anchorage, Alaska ​ Office / Cross-dock ​ 54,000 ​ Fairbanks, Alaska ​ Office / Cross-dock ​ 25,350 ​ ​ ​ ​
Biggest changeMaterial terminal facilities used by the Company’s Ocean Transportation segment include the following: ​ ​ ​ ​ ​ Terminal Location Acreage Honolulu, Hawaii 105 Anchorage, Alaska 38 Dutch Harbor, Alaska 24 Kodiak, Alaska 6 Tacoma, Washington ​ 15 ​ Polaris Point, Guam ​ 30 ​ The Company’s other primary terminal facilities located at the ports of Oakland and Long Beach, California, and Tacoma, Washington are leased by SSAT. ​ Other material facilities used by the Company’s Logistics segment include the following: ​ ​ ​ ​ ​ ​ ​ Other Material Facilities Description of Facility Square Footage Leased facilities: ​ ​ ​ ​ ​ Pooler, Georgia Warehouse 710,844 ​ Oakland, California Warehouse 406,463 ​ Pooler, Georgia Warehouse 324,832 ​ Oakland, California Warehouse 132,000 ​ Auburn, Washington Office / Cross-dock 51,250 ​ Owned facilities: ​ ​ ​ ​ ​ Anchorage, Alaska ​ Office / Cross-dock ​ 54,000 ​ Fairbanks, Alaska ​ Office / Cross-dock ​ 25,350 ​ ​ ​ ​

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeMINE SAFETY DISCLOSURES ​ Not applicable. ​ 27 Table of Contents PART II ​
Biggest changeMINE SAFETY DISCLOSURES ​ Not applicable. ​ 26 Table of Contents PART II ​

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. ​ Mine Safety Disclosures 27 ​ ​ ​ ​ ​ ​ PART II ​ ​ ​ ​ ​ Item 5. ​ Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 28 Item 6. ​ Removed and Reserved 29 Item 7. ​ Management’s Discussion and Analysis of Financial Condition and Results of Operations 30 Item 7A. ​ Quantitative and Qualitative Disclosures About Market Risk 41 Item 8. ​ Financial Statements and Supplementary Data 42
Biggest changeItem 4. ​ Mine Safety Disclosures ‌ 26 ​ ​ ​ ​ ​ ​ PART II ​ ​ ​ ​ ​ Item 5. ​ Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities ‌ 27

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

5 edited+2 added−1 removed1 unchanged
Biggest changeAlthough Matson expects to continue paying quarterly cash dividends on its common stock, the declaration and payment of dividends are subject to the discretion of the Board of Directors and depends upon Matson’s financial condition, results of operations, cash requirements and other factors deemed relevant by the Board of Directors. ​ Share Repurchases: The following is a summary of common stock repurchased by the Company during the three months ended December 31, 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Number of Maximum Number ​ ​ ​ ​ ​ ​ ​ Shares Purchased ​ of Shares that May ​ ​ Total Number of ​ ​ ​ ​ as Part of Publicly ​ Yet Be Purchased ​ ​ Shares ​ Average Price ​ Announced Plans or ​ Under the Plans or Period ​ Purchased ​ Paid Per Share ​ Programs (1) ​ Programs October 1 – 31, 2023 131,744 $ 89.55 ​ 131,744 ​ 2,829,883 ​ November 1 – 30, 2023 216,664 ​ $ 93.19 216,664 ​ 2,613,219 ​ December 1 – 31, 2023 151,031 ​ $ 103.04 151,031 ​ 2,462,188 ​ Total 499,439 ​ $ 95.21 499,439 ​ ​ ​ (1) On June 24, 2021, the Company announced that its Board of Directors had approved a share repurchase program of up to 3.0 million shares of common stock from August 3, 2021 through August 2, 2024.
Biggest changeAlthough Matson expects to continue paying quarterly cash dividends on its common stock, the declaration and payment of dividends are subject to the discretion of the Board and depends upon Matson’s financial condition, results of operations, cash requirements and other factors deemed relevant by the Board. ​ Share Repurchases: The following is a summary of common stock repurchased by the Company during the three months ended December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total Number of Maximum Number ​ ​ ​ ​ ​ ​ ​ Shares Purchased ​ of Shares that May ​ ​ Total Number of ​ ​ ​ ​ as Part of Publicly ​ Yet Be Purchased ​ ​ Shares ​ Average Price ​ Announced Plans or ​ Under the Plans or Period ​ Purchased ​ Paid Per Share ​ Programs (1) (2) ​ Programs October 1 – 31, 2024 ​ 75,000 $ 136.20 ​ 75,000 ​ 969,077 ​ November 1 – 30, 2024 ​ 61,550 ​ ​ 157.20 61,550 ​ 907,527 ​ December 1 – 31, 2024 ​ 77,000 ​ ​ 148.86 77,000 ​ 830,527 ​ Total 213,550 ​ $ 146.81 213,550 ​ ​ ​ (1) On June 24, 2021, Matson’s Board approved a share repurchase program of up to 3.0 million shares of common stock, with subsequent approvals for the addition of 3.0 million shares on each of January 27, 2022, August 23, 2022 and April 27, 2023, for an aggregate total authorization of 12.0 million shares of common stock.
As of February 16, 2024, there were 1,904 shareholders of record of Matson common stock. ​ Stockholder Return Performance Graph and Trading Information: The following information in this Item 5 shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933. ​ The cumulative total return listed below assumed an initial investment of $100 and reinvestment of dividends at each fiscal end and measures the performance of this investment as of the last trading day in the month of December for each of the five years ended December 31, 2023.
As of February 14, 2025, there were 1,796 shareholders of record of Matson common stock. ​ Stockholder Return Performance Graph and Trading Information: The following information in this Item 5 shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933. ​ The cumulative total return listed below assumed an initial investment of $100 and reinvestment of dividends at each fiscal end and measures the performance of this investment as of the last trading day in the month of December for each of the five years ended December 31, 2024.
The graph is a historical representation of past performance only and is not necessarily indicative of future performance. ​ The graph above represents $100 invested on December 31, 2018 in the Company’s stock or the indicated index, including reinvestment of dividends. ​ Trading volume averaged 274,339 shares a day in 2023, compared with 431,336 shares a day in 2022 and 291,899 shares a day in 2021, as reported by the New York Stock Exchange. ​ 28 Table of Contents ​ Dividends: Dividends per share of common stock declared by the Company for each fiscal quarter during 2023, 2022 and 2021 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Dividends Declared ​ 2023 ​ 2022 ​ 2021 First Quarter ​ $ 0.31 $ 0.30 $ 0.23 ​ Second Quarter ​ $ 0.31 $ 0.30 $ 0.23 ​ Third Quarter ​ $ 0.32 $ 0.31 ​ $ 0.30 ​ Fourth Quarter ​ $ 0.32 $ 0.31 ​ $ 0.30 ​ Total ​ $ 1.26 $ 1.22 ​ $ 1.06 ​ ​ Matson’s Board of Directors also declared a cash dividend of $0.32 per share for the first quarter 2024, payable on March 7, 2024 to shareholders of record on February 8, 2024.
The graph above represents $100 invested on December 31, 2019 in the Company’s stock or the indicated index, including reinvestment of dividends. ​ Trading volume averaged 271,862 shares a day in 2024, compared with 274,339 shares a day in 2023 and 431,336 shares a day in 2022, as reported by the New York Stock Exchange. ​ ​ 27 Table of Contents Dividends: Dividends per share of common stock declared by the Company for each fiscal quarter during 2024, 2023 and 2022 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Dividends Declared ​ 2024 ​ 2023 ​ 2022 First Quarter ​ $ 0.32 $ 0.31 $ 0.30 ​ Second Quarter ​ ​ 0.32 ​ 0.31 ​ ​ 0.30 ​ Third Quarter ​ ​ 0.34 ​ 0.32 ​ ​ 0.31 ​ Fourth Quarter ​ ​ 0.34 ​ 0.32 ​ ​ 0.31 ​ Total ​ $ 1.32 $ 1.26 ​ $ 1.22 ​ ​ The Board also declared a cash dividend of $0.34 per share for the first quarter 2025, payable on March 6, 2025 to shareholders of record on February 6, 2025.
Shares may be repurchased in the open market from time to time, and may be repurchased pursuant to a trading plan in accordance with Rule 10b5-1 of the Securities Exchange Act of 1934. ​ ​
The share repurchase program expires on December 31, 2025. Shares may be repurchased in the open market from time to time, and may be made pursuant to a trading plan in accordance with Rule 10b5-1 of the Security Exchange Act of 1934.
On April 27, 2023, the Company’s Board of Directors approved an addition of 3.0 million shares to the Company’s existing share repurchase program, for a total of 12.0 million shares of common stock approved under the program since it was established, and extended the program to December 31, 2025.
(2) Amounts exclude shares withheld for employee taxes upon vesting of stock-based awards. ​ On February 27, 2025, the Company’s Board approved an additional 3.0 million shares of common stock to be added to the Company’s existing share repurchase program and extended the program’s expiration date to December 31, 2027. ​ ​ ​ ITEM 6.
Removed
On January 27, 2022, the Company’s Board of Directors approved an addition of 3.0 million shares to the Company’s existing share repurchase program. On August 23, 2022, the Company’s Board of Directors approved an addition of 3.0 million shares to the Company’s existing share repurchase program.
Added
The graph is a historical representation of past performance only and is not necessarily indicative of future performance.
Added
REMOVED AND RESERVED ​ ​ ​ 28 Table of Contents

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

58 edited+19 added−15 removed29 unchanged
Biggest changeThe information should be read in conjunction with Item 8, “Financial Statements and Supplementary Data.” All fiscal years include 52 weeks, except for the year ended December 31, 2021 which includes 53 weeks (a description of the Company’s fiscal year is included in Note 2 to the Consolidated Financial Statements in Item 8 of Part II below): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (In millions, except per share amounts) 2023 2022 2021 2020 2019 Operating Revenue: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ocean Transportation ​ $ 2,477.0 ​ $ 3,544.6 ​ $ 3,132.8 ​ $ 1,853.9 ​ $ 1,666.6 ​ Logistics ​ 617.6 ​ 798.4 ​ 792.5 ​ 529.4 ​ 536.5 ​ Total Operating Revenue ​ $ 3,094.6 ​ $ 4,343.0 ​ $ 3,925.3 ​ $ 2,383.3 ​ $ 2,203.1 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating and Net Income: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ocean Transportation (1) ​ $ 294.8 ​ $ 1,281.2 ​ $ 1,137.7 ​ $ 244.8 ​ $ 90.8 ​ Logistics ​ 48.0 ​ 72.4 ​ 49.8 ​ 35.5 ​ 38.3 ​ Total Operating Income ​ 342.8 ​ 1,353.6 ​ 1,187.5 ​ 280.3 ​ 129.1 ​ Interest income ​ ​ 36.0 ​ ​ 8.2 ​ ​ — ​ ​ — ​ ​ — ​ Interest expense ​ (12.2) ​ (18.0) ​ (22.6) ​ (27.4) ​ (22.5) ​ Other income (expense), net ​ 6.4 ​ 8.5 ​ 6.4 ​ 6.1 ​ 1.2 ​ Income before Taxes ​ 373.0 ​ 1,352.3 ​ 1,171.3 ​ 259.0 ​ 107.8 ​ Income taxes (2) ​ (75.9) ​ (288.4) ​ (243.9) ​ (65.9) ​ (25.1) ​ Net Income ​ $ 297.1 ​ $ 1,063.9 ​ $ 927.4 ​ $ 193.1 ​ $ 82.7 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Capital Expenditures: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ocean Transportation ​ $ 240.2 ​ $ 190.9 ​ $ 322.4 ​ $ 190.0 ​ $ 294.5 ​ Logistics ​ 8.2 ​ 18.4 ​ 2.9 ​ 2.3 ​ 15.8 ​ Total Capital Expenditures ​ $ 248.4 ​ $ 209.3 ​ $ 325.3 ​ $ 192.3 ​ $ 310.3 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Depreciation and Amortization: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ocean Transportation ​ $ 132.8 ​ $ 133.2 ​ $ 128.6 ​ $ 107.4 ​ $ 93.6 ​ Logistics ​ 11.6 ​ 8.1 ​ 7.3 ​ 7.5 ​ 6.8 ​ ​ ​ ​ 144.4 ​ ​ 141.3 ​ ​ 135.9 ​ ​ 114.9 ​ ​ 100.4 ​ Deferred Dry-docking Amortization — Ocean Transportation ​ ​ 25.3 ​ ​ 24.9 ​ ​ 24.3 ​ ​ 25.1 ​ ​ 34.3 ​ Total Depreciation and Amortization ​ $ 169.7 ​ $ 166.2 ​ $ 160.2 ​ $ 140.0 ​ $ 134.7 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Earnings Per Share in Net Income: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ $ 8.42 ​ $ 27.28 ​ $ 21.67 ​ $ 4.48 ​ $ 1.93 ​ Diluted ​ $ 8.32 ​ $ 27.07 ​ $ 21.47 ​ $ 4.44 ​ $ 1.91 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash dividends per share declared ​ $ 1.26 ​ $ 1.22 ​ $ 1.06 ​ $ 0.90 ​ $ 0.86 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 134.0 ​ $ 249.8 ​ $ 282.4 ​ $ 14.4 ​ $ 21.2 ​ Capital Construction Fund (“CCF”) (3) ​ $ 599.4 ​ $ 518.2 ​ $ — ​ $ — ​ $ — ​ Total Debt (before deferred loan fees deduction) (4) ​ $ 440.6 ​ $ 517.5 ​ $ 629.0 ​ $ 760.1 ​ $ 958.4 ​ Total Shareholders’ equity ​ $ 2,400.7 ​ $ 2,296.9 ​ $ 1,667.4 ​ $ 961.2 ​ $ 805.7 ​ Shares outstanding ​ 34.4 ​ 36.3 ​ 41.0 ​ 43.2 ​ 42.9 ​ (1) The Ocean Transportation segment includes $2.2 million, $83.1 million, $56.3 million, $26.3 million and $20.8 million of equity in income from the Company’s investment in SSAT for 2023, 2022, 2021, 2020 and 2019, respectively.
Biggest changeThe information should be read in conjunction with Item 8, “Financial Statements and Supplementary Data.” All fiscal years include 52 weeks, except for the year ended December 31, 2021 which includes 53 weeks (a description of the Company’s fiscal year is included in Note 2 to the Consolidated Financial Statements in Item 8 of Part II below): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (In millions, except per share amounts) 2024 2023 2022 2021 2020 Operating Revenue: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ocean Transportation ​ $ 2,809.7 ​ $ 2,477.0 ​ $ 3,544.6 ​ $ 3,132.8 ​ $ 1,853.9 ​ Logistics ​ 612.1 ​ 617.6 ​ 798.4 ​ 792.5 ​ 529.4 ​ Total Operating Revenue ​ $ 3,421.8 ​ $ 3,094.6 ​ $ 4,343.0 ​ $ 3,925.3 ​ $ 2,383.3 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating and Net Income: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ocean Transportation (1) ​ $ 500.9 ​ $ 294.8 ​ $ 1,281.2 ​ $ 1,137.7 ​ $ 244.8 ​ Logistics ​ 50.4 ​ 48.0 ​ 72.4 ​ 49.8 ​ 35.5 ​ Total Operating Income ​ 551.3 ​ 342.8 ​ 1,353.6 ​ 1,187.5 ​ 280.3 ​ Interest income ​ ​ 48.3 ​ ​ 36.0 ​ ​ 8.2 ​ ​ — ​ ​ — ​ Interest expense ​ (7.5) ​ (12.2) ​ (18.0) ​ (22.6) ​ (27.4) ​ Other income (expense), net ​ 7.3 ​ 6.4 ​ 8.5 ​ 6.4 ​ 6.1 ​ Income before Taxes ​ 599.4 ​ 373.0 ​ 1,352.3 ​ 1,171.3 ​ 259.0 ​ Income taxes ​ (123.0) ​ (75.9) ​ (288.4) ​ (243.9) ​ (65.9) ​ Net Income ​ $ 476.4 ​ $ 297.1 ​ $ 1,063.9 ​ $ 927.4 ​ $ 193.1 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Capital Expenditures (2): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ocean Transportation ​ $ 298.9 ​ $ 240.2 ​ $ 190.9 ​ $ 322.4 ​ $ 190.0 ​ Logistics ​ 11.2 ​ 8.2 ​ 18.4 ​ 2.9 ​ 2.3 ​ Total Capital Expenditures ​ $ 310.1 ​ $ 248.4 ​ $ 209.3 ​ $ 325.3 ​ $ 192.3 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Depreciation and Amortization: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ocean Transportation ​ $ 141.1 ​ $ 130.6 ​ $ 131.1 ​ $ 124.8 ​ $ 104.7 ​ Logistics ​ 12.0 ​ 11.6 ​ 8.1 ​ 7.3 ​ 7.5 ​ ​ ​ ​ 153.1 ​ ​ 142.2 ​ ​ 139.2 ​ ​ 132.1 ​ ​ 112.2 ​ Deferred Dry-docking Amortization — Ocean Transportation ​ ​ 27.2 ​ ​ 25.3 ​ ​ 24.9 ​ ​ 24.3 ​ ​ 25.1 ​ Total Depreciation and Amortization ​ $ 180.3 ​ $ 167.5 ​ $ 164.1 ​ $ 156.4 ​ $ 137.3 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Earnings Per Share in Net Income: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ $ 14.14 ​ $ 8.42 ​ $ 27.28 ​ $ 21.67 ​ $ 4.48 ​ Diluted ​ $ 13.93 ​ $ 8.32 ​ $ 27.07 ​ $ 21.47 ​ $ 4.44 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash dividends per share declared ​ $ 1.32 ​ $ 1.26 ​ $ 1.22 ​ $ 1.06 ​ $ 0.90 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 266.8 ​ $ 134.0 ​ $ 249.8 ​ $ 282.4 ​ $ 14.4 ​ Capital Construction Fund (“CCF”) (3) ​ $ 642.6 ​ $ 599.4 ​ $ 518.2 ​ $ — ​ $ — ​ Total Debt (before deferred loan fees deduction) (4) ​ $ 400.9 ​ $ 440.6 ​ $ 517.5 ​ $ 629.0 ​ $ 760.1 ​ Total Shareholders’ equity ​ $ 2,652.0 ​ $ 2,400.7 ​ $ 2,296.9 ​ $ 1,667.4 ​ $ 961.2 ​ Shares outstanding ​ 33.0 ​ 34.4 ​ 36.3 ​ 41.0 ​ 43.2 ​ (1) The Ocean Transportation segment includes $(1.0) million, $2.2 million, $83.1 million, $56.3 million and $26.3 million of equity in (loss)/income from the Company’s investment in SSAT for 2024, 2023, 2022, 2021 and 2020, respectively.
Management has discussed the development and selection of these critical accounting estimates with the Audit Committee of our Board of Directors. ​ Long-Lived Assets, Intangible Assets and Goodwill: The Company evaluates its long-lived assets, intangible assets and goodwill for possible impairment in the fourth quarter, or whenever events or changes in circumstances indicate that it is more likely than not that the fair value is less than its carrying amount.
Management has discussed the development and selection of these critical accounting estimates with the Audit Committee of our Board. ​ Long-Lived Assets, Intangible Assets and Goodwill: The Company evaluates its long-lived assets, intangible assets and goodwill for possible impairment in the fourth quarter, or whenever events or changes in circumstances indicate that it is more likely than not that the fair value is less than its carrying amount.
Cash distributions from SSAT are dependent on the level of cash available for distribution after SSAT’s operational and capital needs. Changes in accounts receivable were primarily due to the timing of collections associated with those receivables.
Cash distributions from SSAT are dependent on the level of cash available for distribution after consideration of SSAT’s operational and capital needs. Changes in accounts receivable were primarily due to the timing of collections associated with those receivables.
The Company has evaluated its long-lived assets and finite-lived intangible assets for impairment and determined that there was no impairment for the years ended December 31, 2023, 2022, and 2021. ​ Indefinite-life Intangible Assets and Goodwill: The Company’s intangible assets include goodwill and a trade name, and are grouped at the lowest level reporting unit for which identifiable cash flows are available.
The Company has evaluated its long-lived assets and finite-lived intangible assets for impairment and determined that there was no impairment for the years ended December 31, 2024, 2023, and 2022. ​ Indefinite-life Intangible Assets and Goodwill: The Company’s intangible assets include goodwill and a trade name, and are grouped at the lowest level reporting unit for which identifiable cash flows are available.
The Company has evaluated its indefinite-life intangible assets and goodwill for impairment and determined that there was no impairment for the years ended December 31, 2023, 2022, and 2021. ​ Insurance Related Liabilities: The Company purchases insurance with deductibles or self-insured retentions to mitigate significant risks that it is exposed to.
The Company has evaluated its indefinite-life intangible assets and goodwill for impairment and determined that there was no impairment for the years ended December 31, 2024, 2023, and 2022. ​ Insurance Related Liabilities: The Company purchases insurance with deductibles or self-insured retentions to mitigate significant risks that it is exposed to.
These asset impairment analyses are highly subjective because they require management to make assumptions and apply considerable judgments to, among other things, estimates of the timing and amount of future cash flows, expected useful lives of the assets, potential impact of future events, including changes in economic conditions and operating performance, and future costs of maintenance and improvements of the assets.
These asset impairment analyses are highly subjective because they require management to make assumptions and apply considerable judgments to, among other things, estimates of the timing and amount of future cash flows, expected useful lives of the assets, potential impact of future events, including changes in economic conditions and operating performance, and future costs 38 Table of Contents of maintenance and improvements of the assets.
Discussion and analysis of the financial condition and results of operations of Matson for the year ended December 31, 2022 compared with the year ended December 31, 2021 can be found in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 , filed with the SEC on February 24, 2023. ​ The MD&A is presented in the following sections: ​ ◾ Historical Financial Information ◾ Fourth Quarter 2023 Discussion and Outlook for 2024 ◾ Consolidated Results of Operations ◾ Analysis of Operating Revenue and Income by Segment ◾ Liquidity and Capital Resources ◾ Commitments, Contingencies and Off-Balance Sheet Arrangements ◾ Critical Accounting Estimates ◾ Other Matters ​ ​ ​ 30 Table of Contents HISTORICAL FINANCIAL INFORMATION ​ The comparative selected financial information of the Company is presented for each of the past five years ended December 31, 2023.
Discussion and analysis of the financial condition and results of operations of Matson for the year ended December 31, 2023 compared with the year ended December 31, 2022 can be found in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 , filed with the SEC on February 23, 2024. ​ The MD&A is presented in the following sections: ​ ◾ Historical Financial Information ◾ Fourth Quarter 2024 Discussion and Outlook for 2025 ◾ Consolidated Results of Operations ◾ Analysis of Operating Revenue and Income by Segment ◾ Liquidity and Capital Resources ◾ Commitments, Contingencies and Off-Balance Sheet Arrangements ◾ Critical Accounting Estimates ◾ Other Matters ​ ​ ​ 29 Table of Contents HISTORICAL FINANCIAL INFORMATION ​ The comparative selected financial information of the Company is presented for each of the past five years ended December 31, 2024.
Such insurance includes, but is not limited to, employee health, workers’ compensation, marine liability, cybersecurity, auto liability and physical damage to property and equipment. For certain 39 Table of Contents risks, the Company elects to not purchase insurance because of the excessive cost of such insurance, the perceived remoteness of the risk or insurance coverage is not commercially available.
Such insurance includes, but is not limited to, employee health, workers’ compensation, marine liability, cybersecurity, auto liability and physical damage to property and equipment. For certain risks, the Company elects to not purchase insurance because of the excessive cost of such insurance, the perceived remoteness of the risk or insurance coverage is not commercially available.
The calculation of deferred tax assets and liabilities may be impacted by various factors including but not limited to changes in tax rates; changes in tax laws, regulations, and rulings; changes in interpretations of existing tax laws, regulations and rulings; and changes in the evaluation of the Company’s ability to realize deferred tax assets including operating loss and tax credit carryforwards.
The calculation of deferred tax assets and liabilities may be impacted by various factors including but not limited to changes in tax rates; changes in tax laws, regulations, rulings and interpretations of existing tax laws; and 39 Table of Contents changes in the evaluation of the Company’s ability to realize deferred tax assets including operating loss and tax credit carryforwards.
Working capital is primarily impacted by the amount 37 Table of Contents of net cash provided by operating activities, the amount of capital expenditures, the amount and timing of collections associated with accounts receivable, prepaid expenses and other assets, and the amount and timing of payments associated with accounts payable, accruals, income taxes, debt and other liabilities.
Working capital is primarily impacted by the amount of net cash provided by operating activities, the amount of capital expenditures, the amount and timing of collections associated with accounts receivable, prepaid expenses and other assets, and the amount and timing of payments associated with accounts payable, accruals, income taxes, debt and other liabilities.
These estimates and judgments are applied in the calculation of taxable income, tax credits, tax benefits, CCF and other tax deductions, and in the calculation of certain deferred tax assets and liabilities, which arise from differences in the timing of recognition of revenue, costs and expenses for tax purposes.
These estimates and judgments are applied in the calculation of taxable income, tax credits, tax benefits, CCF related tax deductions, foreign-derived intangible income and other tax deductions, and in the calculation of certain deferred tax assets and liabilities, which arise from differences in the timing of recognition of revenue, costs and expenses for tax purposes.
The Company’s retained risks and other related liabilities contain uncertainties because management is required to apply judgment and make long-term assumptions to estimate the ultimate cost to settle reported claims, and of claims incurred but not reported, as of the balance sheet date. Insurance related liabilities were $41.3 million and $45.4 million at December 31, 2023 and 2022, respectively.
The Company’s retained risks and other related liabilities contain uncertainties because management is required to apply judgment and make long-term assumptions to estimate the ultimate cost to settle reported claims, and of claims incurred but not reported, as of the balance sheet date. Insurance related liabilities were $52.8 million and $41.3 million at December 31, 2024 and 2023, respectively.
These include, for example, all references to 2024 or future years, including such references included under “Fourth Quarter 2023 Discussion and Update on Business Conditions,” as well as statements generally identified through the inclusion of words such as “anticipate,” “believe,” “can,” “commit,” “estimate,” “expect,” “goal,” “intend,” “may,” “plan,” “target,” “should,” “seek,” and “will,” or similar statements or variations of such terms and other similar expressions.
These include, for example, all references to 2025 or future years, including such references included under “Fourth Quarter 2024 Discussion and Outlook for 2025,” as well as statements generally identified through the inclusion of words such as “anticipate,” “believe,” “can,” “commit,” “estimate,” “expect,” “goal,” “intend,” “may,” “plan,” “seek,” “should,” “target,” and “will,” or similar statements or variations of such terms and other similar expressions.
(4) The Company’s debt is described in Note 8 to the Consolidated Financial Statements in Item 8 of Part II. ​ ​ 31 Table of Contents FOURTH QUARTER 2023 DISCUSSION AND OUTLOOK FOR 2024 ​ Ocean Transportation: The Company’s container volume in the Hawaii service in the fourth quarter 2023 was 1.9 percent lower year-over-year.
(4) The Company’s debt is described in Note 8 to the Consolidated Financial Statements in Item 8 of Part II. ​ ​ ​ 30 Table of Contents FOURTH QUARTER 2024 DISCUSSION AND OUTLOOK FOR 2025 ​ Ocean Transportation: The Company’s container volume in the Hawaii service in the fourth quarter 2024 was 1.7 percent lower year-over-year.
The Company’s debt is described in Note 8 to the Consolidated Financial Statements in Item 8 of Part II. ​ Working Capital: The Company had a working capital surplus of $40.0 million at December 31, 2023, compared to a working capital surplus of $178.0 million at December 31, 2022.
The Company’s debt is described in Note 8 to the Consolidated Financial Statements in Item 8 of Part II. ​ Working Capital: The Company had a working capital surplus of $49.2 million at December 31, 2024, compared to a working capital surplus of $40.0 million at December 31, 2023.
The Company did not issue any new fixed interest debt during the years ended December 31, 2023 and 2022. The Company paid $76.9 million of prepaid and scheduled fixed interest debt principal payments, compared to $111.5 million of prepaid scheduled principal payments during the prior year.
The Company did not issue any new fixed interest debt during the years ended December 31, 2024 and 2023. The Company paid $39.7 million of scheduled fixed interest debt principal payments during the year ended December 31, 2024, compared to $76.9 million of prepaid and scheduled fixed interest debt principal payments during the prior year.
The Company expects to fund these capital expenditures (including the LNG installations) with cash and cash equivalents on the Consolidated Balance Sheets and through cash flows generated from future operating activities. ​ Repurchase of Shares: During the year ended December 31, 2023, the Company repurchased approximately 2.1 million shares for a total cost of $158.2 million.
The Company expects to fund these capital expenditures with cash and cash equivalents on the Consolidated Balance Sheets and through cash flows generated from future operating activities. ​ Repurchase of Shares: During the year ended December 31, 2024, the Company repurchased approximately 1.6 million shares for a total cost of $201.0 million.
Sources of liquidity available to the Company as of December 31, 2023 compared to December 31, 2022, were as follows: ​ Cash and Cash Equivalents, Restricted Cash and Accounts Receivable : Cash and cash equivalents, restricted cash and accounts receivable, net as of December 31, 2023 and 2022 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, (In millions) 2023 2022 Change Cash and cash equivalents ​ $ 134.0 ​ $ 249.8 ​ $ (115.8) ​ Restricted cash ​ $ 2.3 ​ $ 3.9 ​ $ (1.6) ​ Accounts receivable, net (1) ​ $ 279.4 ​ $ 268.5 ​ $ 10.9 ​ (1) Eligible accounts receivable of $218.1 million and $9.9 million at December 31, 2023 and 2022, respectively, were assigned to the CCF.
Sources of liquidity available to the Company as of December 31, 2024 compared to December 31, 2023, were as follows: ​ Cash and Cash Equivalents, Restricted Cash and Accounts Receivable : Cash and cash equivalents, restricted cash and accounts receivable, net as of December 31, 2024 and 2023 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, (In millions) 2024 2023 Change Cash and cash equivalents ​ $ 266.8 ​ $ 134.0 ​ $ 132.8 ​ Restricted cash ​ $ — ​ $ 2.3 ​ $ (2.3) ​ Accounts receivable, net (1) ​ $ 268.9 ​ $ 279.4 ​ $ (10.5) ​ CCF - cash and cash equivalents, and investments account ​ $ 642.6 ​ $ 599.4 ​ $ 43.2 ​ (1) Eligible accounts receivable of $178.1 million and $218.1 million at December 31, 2024 and 2023, respectively, were assigned to the CCF.
For additional information on the CCF, see Note 7 to the Consolidated Financial Statements. ​ Changes in the Company’s cash, cash equivalents and restricted cash for the years ended December 31, 2023, 2022 and 2021 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Change (In millions) 2023 2022 2021 2023-2022 2022-2021 Net cash provided by operating activities (1) ​ $ 510.5 ​ $ 1,271.9 ​ $ 984.1 ​ $ (761.4) ​ $ 287.8 Net cash used in investing activities (2) ​ (338.2) ​ (729.3) ​ (323.4) ​ 391.1 ​ (405.9) Net cash used in financing activities (3) ​ (289.7) ​ (576.6) ​ (392.7) ​ 286.9 ​ (183.9) Net (decrease) increase in cash, cash equivalents and restricted cash ​ (117.4) ​ (34.0) ​ 268.0 ​ (83.4) ​ (302.0) Cash, cash equivalents and restricted cash, beginning of the period ​ 253.7 ​ 287.7 ​ 19.7 ​ (34.0) ​ 268.0 Cash, cash equivalents and restricted cash, end of the period ​ $ 136.3 ​ $ 253.7 ​ $ 287.7 ​ $ (117.4) ​ $ (34.0) ​ 35 Table of Contents (1) Changes in Net Cash Provided by Operating Activities: Changes in net cash provided by operating activities for the years ended December 31, 2023, 2022 and 2021 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ Change (In millions) 2023-2022 2022-2021 Net income ​ $ (766.8) ​ $ 136.5 Non-cash depreciation and amortization ​ ​ 3.1 ​ ​ 5.4 Deferred income taxes ​ ​ (70.6) ​ ​ 57.0 Other non-cash related changes, net ​ ​ 4.9 ​ ​ (1.7) Income and distribution from SSAT, net ​ ​ 33.6 ​ ​ (26.4) Accounts receivable, net ​ (85.5) ​ 164.9 Prepaid expenses and other assets ​ 78.7 ​ 2.9 Accounts payable, accruals and other liabilities ​ 42.6 ​ (71.3) Operating lease liabilities ​ 9.3 ​ ​ (54.4) Non-cash amortization of operating lease right of use assets ​ ​ (11.0) ​ ​ 49.7 Deferred dry-docking payments ​ 1.6 ​ 10.6 Non-cash deferred dry-docking amortization ​ ​ 0.4 ​ ​ 0.6 Other long-term liabilities ​ (1.7) ​ 14.0 Total ​ $ (761.4) ​ $ 287.8 ​ Income from SSAT was $2.2 million for the year ended December 31, 2023, compared to $83.1 million in the prior year.
For additional information on the CCF, see Note 7 to the Consolidated Financial Statements. ​ Changes in the Company’s cash and cash equivalents and restricted cash for the years ended December 31, 2024, 2023 and 2022 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Change (In millions) 2024 2023 2022 2024-2023 2023-2022 Net cash provided by operating activities (1) ​ $ 767.8 ​ $ 510.5 ​ $ 1,271.9 ​ $ 257.3 ​ $ (761.4) Net cash used in investing activities (2) ​ (336.1) ​ (338.2) ​ (729.3) ​ 2.1 ​ 391.1 Net cash used in financing activities (3) ​ (301.2) ​ (289.7) ​ (576.6) ​ (11.5) ​ 286.9 Net increase (decrease) in cash, cash equivalents and restricted cash ​ 130.5 ​ (117.4) ​ (34.0) ​ 247.9 ​ (83.4) Cash and cash equivalents, and restricted cash, beginning of the period ​ 136.3 ​ 253.7 ​ 287.7 ​ (117.4) ​ (34.0) Cash and cash equivalents, and restricted cash, end of the period ​ $ 266.8 ​ $ 136.3 ​ $ 253.7 ​ $ 130.5 ​ $ (117.4) ​ (1) Changes in Net Cash Provided by Operating Activities: Changes in net cash provided by operating activities for the years ended December 31, 2024, 2023 and 2022 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ Change (In millions) 2024-2023 2023-2022 Net income ​ $ 179.3 ​ $ (766.8) Non-cash depreciation and amortization ​ ​ 10.9 ​ ​ 3.0 Deferred income taxes ​ ​ 1.3 ​ ​ (70.6) Other non-cash related changes, net ​ ​ (10.0) ​ ​ 5.0 Income and distribution from SSAT, net ​ ​ 17.2 ​ ​ 33.6 Accounts receivable, net ​ 20.7 ​ (85.5) Prepaid expenses and other assets ​ 61.3 ​ 78.7 Accounts payable, accruals and other liabilities ​ (16.5) ​ 42.6 Operating lease assets and liabilities, net ​ 5.3 ​ ​ 9.3 Non-cash amortization of operating lease right of use assets ​ ​ (8.3) ​ ​ (11.0) Deferred dry-docking payments ​ (6.1) ​ 1.6 Non-cash deferred dry-docking amortization ​ ​ 1.9 ​ ​ 0.4 Other long-term liabilities ​ 0.3 ​ (1.7) Total ​ $ 257.3 ​ $ (761.4) ​ Loss from SSAT was $1.0 million for the year ended December 31, 2024, compared to income from SSAT of $2.2 million in the prior year.
The 2023 income tax rate benefited from certain discrete tax adjustments that lowered the effective tax rate in the current year. ​ Net Income during the year ended December 31, 2023 decreased $766.8 million, or 72.1 percent, to $297.1 million for the year ended December 31, 2023, compared to the prior year. ​ ANALYSIS OF OPERATING REVENUE AND INCOME BY SEGMENT ​ The following analysis of operating revenue and income by segment for the years ended December 31, 2023 and 2022 should be read in conjunction with the Company’s reportable segments information included in Note 3 to the Consolidated Financial Statements in Item 8 of Part II. ​ Ocean Transportation: 2023 compared with 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, (Dollars in millions) 2023 2022 Change Ocean Transportation revenue ​ $ 2,477.0 ​ $ 3,544.6 ​ $ (1,067.6) (30.1) % Operating costs and expenses ​ (2,182.2) ​ (2,263.4) ​ 81.2 ​ (3.6) % Operating income ​ $ 294.8 ​ $ 1,281.2 ​ $ (986.4) ​ (77.0) % Operating income margin ​ 11.9 % 36.1 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Volume (Forty-foot equivalent units (FEU), except for automobiles) (1) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Hawaii containers ​ 144,000 ​ 148,500 ​ (4,500) ​ (3.0) % Hawaii automobiles ​ 39,400 ​ 41,300 ​ (1,900) ​ (4.6) % Alaska containers ​ 80,000 ​ 84,900 ​ (4,900) ​ (5.8) % China containers ​ 140,700 ​ 163,100 ​ (22,400) ​ (13.7) % Guam containers ​ 20,100 ​ 21,100 ​ (1,000) ​ (4.7) % Other containers (2) ​ 17,500 ​ 22,500 ​ (5,000) ​ (22.2) % (1) Approximate volumes included for the period are based on the voyage departure date, but revenue and operating income are adjusted to reflect the percentage of revenue and operating income earned during the reporting period for voyages in transit at the end of each reporting period.
The 2023 income tax rate benefited from certain discrete tax adjustments that lowered the effective tax rate in the prior year. ​ Net Income during the year ended December 31, 2024 increased $179.3 million, or 60.4 percent, to $476.4 million, compared to the prior year. ​ ANALYSIS OF OPERATING REVENUE AND INCOME BY SEGMENT ​ The following analysis of operating revenue and income by segment for the years ended December 31, 2024 and 2023 should be read in conjunction with the Company’s reportable segments information included in Note 3 to the Consolidated Financial Statements in Item 8 of Part II. ​ 33 Table of Contents Ocean Transportation: 2024 compared with 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, (Dollars in millions) 2024 2023 Change Ocean Transportation revenue ​ $ 2,809.7 ​ $ 2,477.0 ​ $ 332.7 13.4 % Operating costs and expenses ​ (2,308.8) ​ (2,182.2) ​ (126.6) ​ 5.8 % Operating income ​ $ 500.9 ​ $ 294.8 ​ $ 206.1 ​ 69.9 % Operating income margin ​ 17.8 % 11.9 % ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Volume (Forty-foot equivalent units (FEU), except for automobiles) (1) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Hawaii containers ​ 140,700 ​ 144,000 ​ (3,300) ​ (2.3) % Hawaii automobiles ​ 30,400 ​ 39,400 ​ (9,000) ​ (22.8) % Alaska containers ​ 80,500 ​ 80,000 ​ 500 ​ 0.6 % China containers ​ 144,100 ​ 140,700 ​ 3,400 ​ 2.4 % Guam containers ​ 18,800 ​ 20,100 ​ (1,300) ​ (6.5) % Other containers (2) ​ 17,000 ​ 17,500 ​ (500) ​ (2.9) % (1) Approximate volume included for the period are based on the voyage departure date, but revenue and operating income are adjusted to reflect the percentage of revenue and operating income earned during the reporting period for voyages in transit at the end of each reporting period.
The increase in interest income was due to amounts on deposit in cash and cash equivalent accounts, and cash on deposit within the Capital Construction Fund that were invested in interest bearing accounts during the year ended December 31, 2023. ​ 33 Table of Contents Interest Expense was $12.2 million for the year ended December 31, 2023, compared to $18.0 million in the prior year.
The increase in interest income was also due to increased amounts of cash and cash equivalent accounts, and cash on deposit within the Capital Construction Fund that were invested in interest bearing accounts during the year ended December 31, 2024, compared to the prior year. ​ Interest Expense was $7.5 million for the year ended December 31, 2024, compared to $12.2 million in the prior year.
The decrease in interest expense was due to lower outstanding debt during the year ended December 31, 2023, compared to the prior year. ​ Other Income (Expense), net was $6.4 million for the year ended December 31, 2023, compared to $8.5 million in the prior year, and relates to the amortization of certain components of net periodic benefit costs or gains related to the Company’s pension and post-retirement plans.
The decrease in interest expense was due to lower outstanding debt and a higher offset of capitalized interest related to the construction of new vessels during the year ended December 31, 2024, compared to the prior year. ​ Other Income (Expense), net was $7.3 million for the year ended December 31, 2024, compared to $6.4 million in the prior year, and relates to the amortization of certain components of net periodic benefit costs or gains related to the Company’s pension and post-retirement plans.
The decrease in Other income (expense) was due to unfavorable adjustments reflected in the Company’s pension and post-retirement plan liabilities during the year ended December 31, 2023. ​ Income Taxes for the year ended December 31, 2023 were $75.9 million, or 20.3 percent of income before income taxes, compared to $288.4 million, or 21.3 percent of income before income taxes in the prior year.
The increase in other income (expense) was due to favorable adjustments reflected in the Company’s pension and post-retirement plan liabilities during the year ended December 31, 2024, compared to the prior year. ​ Income Taxes for the year ended December 31, 2024 were $123.0 million, or 20.5 percent of income before income taxes, compared to $75.9 million, or 20.3 percent of income before income taxes in the prior year.
The decrease was due to a decrease in Ocean Transportation operating income of $986.4 million and a decrease in Logistics operating income of $24.4 million. ​ The reasons for changes in operating revenue, operating costs and expenses, and operating income are described below, by business segment, in “Analysis of Operating Revenue and Income by Segment.” ​ Interest Income was $36.0 million for the year ended December 31, 2023, compared to $8.2 million in the prior year.
The increase was due to an increase in Ocean Transportation operating income of $206.1 million and an increase in Logistics operating income of $2.4 million. ​ The reasons for changes in operating revenue, operating costs and expenses, and operating income are described below, by business segment, in “Analysis of Operating Revenue and Income by Segment.” ​ Interest Income was $48.3 million for the year ended December 31, 2024, compared to $36.0 million in the prior year.
(2) Includes containers from services in various islands in Micronesia and the South Pacific, and Okinawa, Japan. ​ Ocean Transportation revenue decreased $1,067.6 million, or 30.1 percent, during the year ended December 31, 2023, compared with the year ended December 31, 2022.
(2) Includes containers from services in various islands in Micronesia and the South Pacific, and Okinawa, Japan. ​ Ocean Transportation revenue increased $332.7 million, or 13.4 percent, during the year ended December 31, 2024, compared with the year ended December 31, 2023.
The remaining number of shares that may be repurchased under the Company’s stock repurchase program was 2,462,188 shares at December 31, 2023. ​ ​ COMMITMENTS, CONTINGENCIES AND OFF-BALANCE SHEET ARRANGEMENTS ​ Commitments and Contingencies: A description of other commitments and contingencies is set forth in Note 9, Note 11 and Note 17 to the Consolidated Financial Statements in Item 8 of Part II below, and is incorporated herein by reference. ​ Off-balance Sheet Arrangements: The Company is not currently party to any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future material effect on the Company’s financial condition, results of operations or cash flows. ​ ​ 38 Table of Contents CRITICAL ACCOUNTING ESTIMATES ​ The Company’s significant accounting policies are described in Note 2 to the Consolidated Financial Statements in Item 8 of Part II below.
On February 27, 2025, the Company’s Board approved an additional 3.0 million shares of common stock to be added to the Company’s existing share repurchase program and extended the program’s expiration date to December 31, 2027. ​ ​ COMMITMENTS, CONTINGENCIES AND OFF-BALANCE SHEET ARRANGEMENTS ​ Commitments and Contingencies: A description of other commitments and contingencies is set forth in Note 9, Note 11 and Note 17 to the Consolidated Financial Statements in Item 8 of Part II below, and is incorporated herein by reference. ​ Off-balance Sheet Arrangements: The Company is not currently party to any off-balance sheet arrangements that have, or are reasonably likely to have, a current or future material effect on the Company’s financial condition, results of operations or cash flows. ​ ​ CRITICAL ACCOUNTING ESTIMATES ​ The Company’s significant accounting policies are described in Note 2 to the Consolidated Financial Statements in Item 8 of Part II below.
The decrease in capitalized vessel construction expenditures was due to the timing of milestone payments related to the Company’s new fleet renewal program. Capital expenditures (excluding vessel construction expenditures) were $195.5 million for the year ended December 31, 2023, compared to $146.9 million for the prior year.
Capitalized vessel construction expenditures were $95.6 million for the year ended December 31, 2024, compared to $52.9 million in the prior year. The increase in capitalized vessel construction expenditures was due to the timing of milestone payments related to the Company’s fleet renewal program.
Total debt as of December 31, 2023 and 2022 is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, ​ (In millions) ​ 2023 2022 Change ​ Fixed interest debt ​ $ 440.6 ​ $ 517.5 ​ $ (76.9) ​ Total Debt ​ $ 440.6 ​ $ 517.5 ​ $ (76.9) ​ ​ Total debt decreased by $76.9 million during the year ended December 31, 2023 compared to the prior year.
Total debt as of December 31, 2024 and 2023 is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, ​ (In millions) ​ 2024 2023 Change ​ Variable interest debt ​ $ — ​ $ — ​ $ — ​ Fixed interest debt ​ ​ 400.9 ​ ​ 440.6 ​ ​ (39.7) ​ Total Debt (excluding deferred loan fees) ​ $ 400.9 ​ $ 440.6 ​ $ (39.7) ​ ​ Total debt decreased by $39.7 million during the year ended December 31, 2024 compared to the prior year.
The decrease in fixed interest debt was due to the $26.4 million prepayments of Title XI debt, and scheduled debt repayments of private placement term loans and Title XI debt made during the year ended December 31, 2023. ​ As of December 31, 2023, the Company had $644.2 million of unused capacity under the revolving credit facility, with a maturity date of March 31, 2026.
The decrease in fixed interest debt was due to the scheduled debt repayments made during the year ended December 31, 2024. ​ As of December 31, 2024, the Company had $643.9 million of unused capacity under the revolving credit facility, with a maturity date of March 31, 2026.
The decrease was primarily due to lower contributions from transportation brokerage and supply chain management. ​ LIQUIDITY AND CAPITAL RESOURCES ​ The Company’s primary sources of liquidity are its cash flows generated from operating activities and its debt.
The increase was primarily due to a higher contribution from supply chain management. ​ 34 Table of Contents LIQUIDITY AND CAPITAL RESOURCES ​ The Company’s primary sources of liquidity are its cash flows generated from operating activities and its debt.
For 2024, the Company expects volume to approximate the level achieved last year. ​ The contribution in the fourth quarter 2023 from the Company’s SSAT joint venture investment was $4.1 million, or $3.1 million higher than the fourth quarter 2022.
For the full year 2025, the Company expects volume to approximate the level achieved last year. ​ The loss in the fourth quarter 2024 from the Company’s SSAT joint venture investment was $9.5 million, or $13.6 million lower than the income of $4.1 million in fourth quarter 2023.
For the full year 2024, the Company expects its effective tax rate to be approximately 22.0 percent. ​ Capital and Vessel Dry-docking Expenditures: For the full year 2023, the Company made capital expenditure payments excluding new builds of $195.5 million, capitalized vessel construction expenditures of $52.9 million, and dry-docking payments of $24.1 million.
For the full year 2025, the Company expects its effective tax rate to be approximately 22.0 percent. ​ Capital and Vessel Dry-docking Expenditures: For the full year 2024, the Company made capital expenditure payments excluding new vessel construction expenditures of $214.5 million, new vessel construction expenditures (including capitalized interest and owner’s items) of $95.6 million, and dry-docking payments of $30.2 million.
For the full year 2024, the Company expects to make other capital expenditure payments, including maintenance capital expenditures, of approximately $180 to $200 million, new vessel construction expenditures (including capitalized interest and owner’s items) of approximately $75 million, and dry-docking payments of approximately $35 million. ​ ​ CONSOLIDATED RESULTS OF OPERATIONS ​ The following analysis of the financial results of operations of Matson for the years ended December 31, 2023 and 2022 should be read in conjunction with the Consolidated Financial Statements in Item 8 of Part II below. ​ Consolidated Results: 2023 compared with 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, (Dollars in millions, except per share amounts) ​ 2023 ​ 2022 ​ Change Operating revenue $ 3,094.6 $ 4,343.0 $ (1,248.4) (28.7) % Operating costs and expenses ​ (2,751.8) ​ (2,989.4) ​ 237.6 (7.9) % Operating income ​ 342.8 ​ 1,353.6 ​ (1,010.8) (74.7) % Interest income ​ ​ 36.0 ​ ​ 8.2 ​ ​ 27.8 339.0 % Interest expense ​ (12.2) ​ (18.0) ​ 5.8 (32.2) % Other income (expense), net ​ 6.4 ​ 8.5 ​ (2.1) (24.7) % Income before taxes ​ 373.0 ​ 1,352.3 ​ (979.3) (72.4) % Income taxes ​ (75.9) ​ (288.4) ​ 212.5 (73.7) % Net income ​ $ 297.1 ​ $ 1,063.9 ​ $ (766.8) (72.1) % Basic earnings per share ​ $ 8.42 ​ $ 27.28 ​ $ (18.86) (69.1) % Diluted earnings per share ​ $ 8.32 ​ $ 27.07 ​ $ (18.75) (69.3) % ​ Fiscal Year: Fiscal years ended December 31, 2023 and 2022 include 52 weeks. ​ Consolidated Operating Revenue for the year ended December 31, 2023 decreased $1,248.4 million, or 28.7 percent, compared to the prior year.
For the full year 2025, the Company expects to make other capital expenditure payments, including maintenance capital expenditures, of approximately $120 to $140 million, new vessel construction expenditures (including capitalized interest and owner’s items) of approximately $305 million, and dry-docking payments of approximately $40 million. ​ ​ CONSOLIDATED RESULTS OF OPERATIONS ​ The following analysis of the financial results of operations of Matson for the years ended December 31, 2024 and 2023 should be read in conjunction with the Consolidated Financial Statements in Item 8 of Part II below. ​ Consolidated Results: 2024 compared with 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, (Dollars in millions, except per share amounts) ​ 2024 ​ 2023 ​ Change Operating revenue $ 3,421.8 $ 3,094.6 $ 327.2 10.6 % Operating costs and expenses ​ (2,870.5) ​ (2,751.8) ​ (118.7) 4.3 % Operating income ​ 551.3 ​ 342.8 ​ 208.5 60.8 % Interest income ​ ​ 48.3 ​ ​ 36.0 ​ ​ 12.3 34.2 % Interest expense ​ (7.5) ​ (12.2) ​ 4.7 (38.5) % Other income (expense), net ​ 7.3 ​ 6.4 ​ 0.9 14.1 % Income before taxes ​ 599.4 ​ 373.0 ​ 226.4 60.7 % Income taxes ​ (123.0) ​ (75.9) ​ (47.1) 62.1 % Net income ​ $ 476.4 ​ $ 297.1 ​ $ 179.3 60.4 % Basic earnings per share ​ $ 14.14 ​ $ 8.42 ​ $ 5.72 67.9 % Diluted earnings per share ​ $ 13.93 ​ $ 8.32 ​ $ 5.61 67.4 % ​ 32 Table of Contents Fiscal Year: Fiscal years ended December 31, 2024 and 2023 include 52 weeks. ​ Consolidated Operating Revenue for the year ended December 31, 2024 increased $327.2 million, or 10.6 percent, compared to the prior year.
The decrease in deferred dry-docking payments was due to a decrease in vessel dry-dock related activities during the year ended December 31, 2023, compared to the prior year. ​ (2) Changes in Net Cash Used in Investing Activities: Changes in net cash used in investing activities for the years ended December 31, 2023, 2022 and 2021 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ Change (In millions) 2023-2022 2022-2021 Cash deposits and interest into the CCF ​ $ 454.3 ​ $ (551.6) Withdrawals from CCF ​ ​ (14.7) ​ ​ 33.4 Capitalized vessel construction expenditures ​ ​ 9.5 ​ ​ (47.5) Capital expenditures (excluding vessel construction expenditures) ​ ​ (48.6) ​ ​ 163.5 Proceeds from disposal of property and equipment, net, and other ​ (9.4) ​ ​ (3.7) Total ​ $ 391.1 ​ $ (405.9) ​ During the year ended December 31, 2023, cash deposits and interest earned in the CCF were $100.0 million and $28.5 million, respectively, compared to $579.7 million and $3.1 million in the prior year, respectively.
Changes in other long-term liabilities primarily related to payments of pension and post-retirement liabilities, and multi-employer liabilities. ​ (2) Changes in Net Cash Used in Investing Activities: Changes in net cash used in investing activities for the years ended December 31, 2024, 2023 and 2022 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ Change (In millions) 2024-2023 2023-2022 Cash deposits and interest into the CCF ​ $ 7.8 ​ $ 454.3 Withdrawals from CCF ​ ​ 39.7 ​ ​ (14.7) Capitalized vessel construction expenditures ​ ​ (42.7) ​ ​ 9.5 Capital expenditures (excluding vessel construction expenditures) ​ ​ (19.0) ​ ​ (48.6) Proceeds from disposal of property and equipment, net, and other ​ 4.7 ​ ​ — Payments for asset acquisitions ​ ​ 11.6 ​ ​ (9.4) Total ​ $ 2.1 ​ $ 391.1 ​ During the year ended December 31, 2024, cash and interest deposited into the CCF were $50.0 million and $18.8 million, compared to $100.0 million and $31.1 million in the prior year, respectively.
The decrease in the Company’s working capital surplus during the year ended December 31, 2023 was due to the decrease in cash provided by operating activities and higher capital expenditures during the year. ​ Capital Expenditures: The Company expects to make the following capital expenditures during the years ending December 31, 2024, 2025 and 2026: ​ ​ ​ ​ ​ ​ ​ ​ ​ (In millions) 2024 2025 2026 ​ New vessel construction milestone payments and related costs ​ $75 ​ $380 ​ $360 ​ LNG installations and reengining on existing vessels ​ $70 - $80 ​ $10 - $15 ​ - ​ Maintenance and other capital expenditures ​ $110 - $120 ​ $100 - $110 ​ $80 - $90 ​ Total Estimated Capital Expenditures ​ $255 - $275 ​ $490 - $505 ​ $440 - $450 ​ ​ New vessel construction milestone payments and related costs are for the Company’s new vessel program for the construction of three new vessels at a cost of approximately $1.0 billion with expected delivery dates during the fourth quarter of 2026, the second quarter of 2027 and the fourth quarter of 2027.
The increase in the Company’s working capital surplus during the year ended December 31, 2024 was due to the increase in cash provided by operating activities offset by higher capital expenditures during the year. ​ Capital Expenditures: The Company expects to make the following capital expenditures during the years ending December 31, 2025, 2026 and 2027: ​ ​ ​ ​ ​ ​ ​ ​ ​ (In millions) 2025 2026 2027 ​ New vessel construction milestone payments and related costs ​ $305 ​ $350 ​ $220 ​ Maintenance and other capital expenditures ​ 120 - 140 ​ ~100 ​ ~100 ​ Total Estimated Capital Expenditures ​ $425 - $445 ​ ~$450 ​ ~$320 ​ ​ New vessel construction milestone payments and related costs are for the Company’s construction of three new vessels at a cost of approximately $1.0 billion (excluding owners’ items and change orders) with expected delivery dates during the first quarter 2027, the third quarter 2027 and the second quarter 2028.
(3) The Company’s Capital Construction Fund is described in Note 7 to the Consolidated Financial Statements in Item 8 of Part II.
(2) Capital expenditures represent amounts included in cash flows from investing activities in the Company’s Consolidated Statements of Cash Flows for the years presented. (3) The Company’s Capital Construction Fund is described in Note 7 to the Consolidated Financial Statements in Item 8 of Part II.
The decrease was primarily due to lower revenue in transportation brokerage. ​ Logistics operating income decreased $24.4 million, or 33.7 percent, during the year ended December 31, 2023, compared with the year ended December 31, 2022.
The decrease was primarily due to lower revenue in transportation brokerage, partially offset by higher revenue in supply chain management. ​ Logistics operating income increased $2.4 million, or 5.0 percent, during the year ended December 31, 2024, compared with the year ended December 31, 2023.
The decrease was due to decrease in Ocean Transportation revenue of $1,067.6 million and a decrease in Logistics revenue of $180.8 million. ​ Operating Costs and Expenses for the year ended December 31, 2023 decreased $237.6 million, or 7.9 percent, compared to the prior year.
The increase was due to an increase in Ocean Transportation operating costs and expenses of $126.6 million which was partially offset by a decrease in Logistics operating costs and expenses of $7.9 million. ​ Operating Income for the year ended December 31, 2024 increased $208.5 million, or 60.8 percent, compared to the prior year.
The decrease was primarily due to a lower contribution from transportation brokerage. For 2024, the Company expects challenging business conditions for transportation brokerage at least through the first half of the year, which the Company expects to lead to operating income being lower in 2024 than the level achieved in 2023.
The increase was primarily due to a higher contribution from supply chain management. For 2025, the Company expects challenging business conditions for transportation brokerage for most of the year and a lower contribution from supply chain management, which the Company expects to lead to modestly lower operating income compared to the level achieved in 2024.
Significant changes to these estimates may result in an increase or decrease to the Company’s income taxes in a subsequent period. ​ The Company records a valuation allowance if, based on the weight of available evidence, management believes that it is more likely than not that some portion or all of a recorded deferred tax asset would not be realized in future periods. ​ Additional information about the Company’s income taxes is included in Note 10 to the Consolidated Financial Statements in Item 8 of Part II below. ​ ​ OTHER MATTERS ​ New Accounting Pronouncements: See Note 2 to the Consolidated Financial Statements in Item 8 of Part II below for additional information on new accounting pronouncements. ​ ​ 40 Table of Contents
Significant changes to these estimates may result in an increase or decrease to the Company’s income taxes in a subsequent period. ​ Additional information about the Company’s income taxes is included in Note 10 to the Consolidated Financial Statements in Item 8 of Part II below. ​ ​ OTHER MATTERS ​ New Accounting Pronouncements: See Note 2 to the Consolidated Financial Statements in Item 8 of Part II below for additional information on new accounting pronouncements. ​ ​
The Company expects volume in 2024 to be comparable to the level in 2023, reflecting modest economic growth in Hawaii and stable market share. ​ In China, the Company’s container volume in the fourth quarter 2023 increased 23.3 percent year-over-year.
The Company expects volume in 2025 to be comparable to the level achieved in 2024, reflecting modest economic growth in Hawaii and stable market share. ​ In China, the Company achieved significantly higher freight rates in the fourth quarter 2024 compared to the year ago period.
Cash withdrawals from the CCF were $49.9 million during the year ended December 31, 2023, compared to $64.6 million in the prior year, and were related to vessel construction milestone payments. Capitalized vessel construction expenditures were $52.9 million for the year ended December 31, 2023, compared to $62.4 million in the prior year.
During the year ended December 31, 2024, cash withdrawals from the CCF were $89.6 million, compared to $49.9 million in the prior year, related to vessel construction milestone payments. During the year ended December 31, 2024, the Company repurchased $53.8 million of assigned accounts receivable. No assigned accounts receivable were repurchased during the year ended December 31, 2023.
Treasury Obligation Funds and is classified as a long-term asset in the Company’s Consolidated Balance Sheets, as the Company intends to use qualified cash withdrawals from the CCF to fund long-term investments in the construction of new vessels.
Cash on deposit and investments in the CCF are classified as a long-term asset in the Company’s Consolidated Balance Sheets, as the Company intends to use qualified cash withdrawals from the CCF to fund long-term investments in the construction of new vessels . ​ Assigned accounts receivable in the CCF are classified as part of accounts receivable in the Consolidated Balance Sheets due to the nature of the assignment. ​ Debt: The Company utilizes a mix of fixed and variable debt for liquidity and to fund the Company’s operations.
The decrease was due to a decrease in Ocean Transportation operating costs and expenses of $81.2 million and a decrease in Logistics operating costs and expenses of $156.4 million. ​ Operating Income for the year ended December 31, 2023 decreased $1,010.8 million, or 74.7 percent, compared to the prior year.
The increase was due to an increase in Ocean Transportation revenue of $332.7 million which was partially offset by a decrease in Logistics revenue of $5.5 million. ​ Operating Costs and Expenses for the year ended December 31, 2024 increased $118.7 million, or 4.3 percent, compared to the prior year.
The decrease was primarily due to lower freight rates and volume in China and a lower contribution from SSAT, partially offset by lower operating costs and expenses including fuel-related expenses primarily related to the discontinuation of the CCX service and lower fuel costs and the timing of fuel-related surcharge collections. ​ 34 Table of Contents The Company’s SSAT terminal joint venture investment contributed $2.2 million during the year ended December 31, 2023, compared to a contribution of $83.1 million during the year ended December 31, 2022.
The increase was primarily due to significantly higher freight rates in China, higher freight rates in the domestic tradelanes, and higher volume in China, partially offset by higher operating costs and general and administrative expenses. ​ The Company’s SSAT terminal joint venture investment incurred a loss of $1.0 million during the year ended December 31, 2024, compared to income of $2.2 million during the year ended December 31, 2023.
The decrease in income from SSAT was primarily due to lower operating profits generated by SSAT during the year ended December 31, 2023, compared to the prior year. No cash distributions were received from SSAT during the year ended December 31, 2023, compared to $47.3 million of dividends received in the prior year.
No impairment charge was recorded by SSAT during the year ended December 31, 2023. Cash dividends received from SSAT was $14.0 million for the year ended December 31, 2024, compared to no cash distributions received in the prior year.
The decrease was primarily driven by lower demurrage revenue. ​ Logistics: 2023 compared with 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, (Dollars in millions) 2023 2022 Change Logistics revenue ​ $ 617.6 ​ $ 798.4 $ (180.8) (22.6) % Operating costs and expenses ​ (569.6) ​ (726.0) 156.4 ​ (21.5) % Operating income ​ $ 48.0 ​ $ 72.4 $ (24.4) ​ (33.7) % Operating income margin ​ 7.8 % 9.1 % ​ ​ ​ ​ ​ ​ Logistics revenue decreased $180.8 million, or 22.6 percent, during the year ended December 31, 2023, compared with the year ended December 31, 2022.
The decrease was due to an impairment charge related to the write-down of a terminal operating lease asset in the fourth quarter 2024 of $18.4 million, partially offset by higher lift volume. ​ Logistics: 2024 compared with 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, (Dollars in millions) 2024 2023 Change Logistics revenue ​ $ 612.1 ​ $ 617.6 $ (5.5) (0.9) % Operating costs and expenses ​ (561.7) ​ (569.6) 7.9 ​ (1.4) % Operating income ​ $ 50.4 ​ $ 48.0 $ 2.4 ​ 5.0 % Operating income margin ​ 8.2 % 7.8 % ​ ​ ​ ​ ​ ​ Logistics revenue decreased $5.5 million, or 0.9 percent, during the year ended December 31, 2024, compared with the year ended December 31, 2023.
Changes in operating lease liabilities were primarily due to operating leases that expired during the year ended December 31, 2023, partially offset by new operating leases entered into during the year ended December 31, 2023. Deferred dry-docking payments were $24.1 million for the year ended December 31, 2023, compared to $25.7 million in the prior year.
Changes in accounts payable, accruals and other liabilities were primarily due to the timing of payments associated with those liabilities. Changes in operating lease liabilities were primarily due to new operating leases entered into during the year ended December 31, 2024, offset by operating leases that expired during the year ended December 31, 2024.
Capital expenditures (excluding vessel construction expenditures) during the year ended December 31, 2023 included costs associated with LNG installations and the reengining of an existing vessel, and the purchase of additional containers, chassis and other terminal equipment to support the Company’s operational activities. ​ 36 Table of Contents (3) Changes in Net Cash Used in Financing Activities: Changes in net cash used in financing activities for the years ended December 31, 2023, 2022 and 2021 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ Change (In millions) 2023-2022 2022-2021 Repurchase of Matson common stock ​ $ 241.8 ​ $ (198.7) Repayments of fixed interest debt ​ ​ 34.6 ​ ​ (52.2) Repayments and borrowings under revolving credit facility, net ​ ​ — ​ ​ 71.8 Withholding tax related to net share settlements of restricted stock units ​ ​ 7.5 ​ ​ (5.7) Dividends paid ​ ​ 3.0 ​ ​ (2.1) Payment of financing costs ​ ​ — ​ ​ 3.0 Total ​ $ 286.9 ​ $ (183.9) ​ The Company paid $155.2 million to repurchase common stock during the year ended December 31, 2023, compared to $397.0 million in the prior year.
During the year ended December 31, 2024, the Company paid $0.8 million related to asset acquisitions, compared to $12.4 million in the prior year. ​ (3) Changes in Net Cash Used in Financing Activities: Changes in net cash used in financing activities for the years ended December 31, 2024, 2023 and 2022 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ Change (In millions) 2024-2023 2023-2022 Repurchase of Matson common stock ​ $ (43.9) ​ $ 241.8 Repayments of fixed interest debt ​ ​ 37.2 ​ ​ 34.6 Shares withheld for taxes related to settlement of restricted stock units ​ ​ (5.0) ​ ​ 7.5 Dividends paid ​ ​ 0.2 ​ ​ 3.0 Total ​ $ (11.5) ​ $ 286.9 ​ The Company paid $199.1 million to repurchase common stock during the year ended December 31, 2024, compared to $155.2 million in the prior year.
Additionally, the reengining of Manukai to operate on LNG and conventional fuels is in progress with an expected remaining cost of approximately $72 million. ​ Maintenance and other capital expenditures include amounts that the Company expects to spend on various capital projects, including capital expenditures related to the second and third phase of its program to modernize and renovate its terminal facility at Sand Island, Honolulu, Hawaii, repurchases of leased equipment, vessel capital maintenance and annual equipment purchases to support the Company’s operations.
Future milestone payments are expected to be financed with cash currently on deposit in the Company’s CCF, cash and cash equivalents on the Consolidated Balance Sheets, cash flows generated from future operations, borrowings available under the Company’s unsecured revolving credit facility or additional debt financings. 37 Table of Contents ​ Maintenance and other capital expenditures include amounts that the Company expects to spend on various capital projects, including capital expenditures related to the second and third phase of its program to modernize and renovate its terminal facility at Sand Island, Honolulu, Hawaii, repurchases of leased equipment, vessel capital maintenance and annual equipment purchases to support the Company’s operations.
The decrease was primarily due to lower average freight rates and volume in China. ​ On a year-over-year FEU basis, Hawaii container volume decreased 3.0 percent primarily due to lower general westbound demand and lower eastbound volume; Alaska volume decreased 5.8 percent due to lower export seafood volume from the AAX; China volume was 13.7 percent lower primarily due to CCX volume in the first nine months of 2022 (the CCX service was discontinued in the third quarter 2022); Guam volume was 4.7 percent lower primarily due to lower general demand; and Other containers volume decreased 22.2 percent. ​ Ocean Transportation operating income decreased $986.4 million during the year ended December 31, 2023, compared with the year ended December 31, 2022.
The increase was primarily due to significantly higher freight rates in China, higher freight rates in the domestic tradelanes, and higher volume in China, partially offset by lower domestic tradelane volume. ​ On a year-over-year FEU basis, Hawaii container volume decreased 2.3 percent primarily due to lower general demand; Alaska volume increased 0.6 percent due to higher general demand, partially offset by one less northbound sailing; China volume increased 2.4 percent due to stronger seasonal volume in the fourth quarter 2024 and one additional sailing; Guam volume decreased 6.5 percent primarily due to lower general demand; and Other containers volume decreased 2.9 percent. ​ Ocean Transportation operating income increased $206.1 million, or 69.9 percent, during the year ended December 31, 2024, compared with the year ended December 31, 2023.
For the first quarter 2024, the Company expects consolidated operating income to be lower than the $38.7 million achieved in the first quarter 2023. ​ Depreciation and Amortization: For the full year 2024, the Company expects depreciation and amortization expense to be approximately $180 million, inclusive of dry-docking amortization of approximately $27 million. ​ Interest Income: The Company expects interest income for the full year 2024 to be approximately $35 million. ​ Interest Expense: The Company expects interest expense for the full year 2024 to be approximately $8 million. ​ 32 Table of Contents Other Income (Expense): The Company expects full year 2024 other income (expense) to be approximately $7 million in income, which is attributable to other component costs related to the Company’s pension and post-retirement plans. ​ Income Taxes: In the fourth quarter 2023, the Company’s effective tax rate was 26.0 percent.
However, if trade conditions in the Red Sea remain disrupted through year end and there are no significant changes from today in the other factors noted above, the Company expects full year 2025 consolidated operating income to approach the level achieved in 2024. ​ Depreciation and Amortization: For full year 2025, the Company expects depreciation and amortization expense to be approximately $200 million, inclusive of dry-docking amortization of approximately $26 million. ​ Interest Income: The Company expects interest income for the full year 2025 to be approximately $31 million. ​ Interest Expense: The Company expects interest expense for the full year 2025 to be approximately $7 million. ​ Other Income (Expense): The Company expects full year 2025 other income (expense) to be approximately $9 million in income, which is attributable to the amortization of certain components of net periodic benefit costs or gains related to the Company’s pension and post-retirement plans. ​ Income Taxes: In the fourth quarter 2024, the Company’s effective tax rate was 19.1 percent.
Cash on deposit in the CCF and assigned accounts receivable as of December 31, 2023 and 2022 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, (In millions) ​ 2023 2022 Capital Construction Fund: ​ ​ ​ ​ ​ ​ Cash on deposit ​ $ 599.4 ​ $ 518.2 Assigned accounts receivables ​ $ 218.1 ​ $ 9.9 ​ During the years ended December 31, 2023 and 2022, the Company deposited $128.5 million and $582.8 million into the CCF, respectively.
Cash on deposit and investments in the CCF and assigned accounts receivable as of December 31, 2024 and 2023 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, (In millions) 2024 2023 Capital Construction Fund: ​ ​ ​ ​ ​ ​ Cash and cash equivalents, and investments account ​ $ 642.6 ​ $ 599.4 Assigned accounts receivables ​ $ 178.1 ​ $ 218.1 ​ Cash on deposit in the CCF is invested in a U.S.
For the first quarter 2024, the Company expects Logistics operating income to be lower than the $10.9 million achieved in the first quarter 2023. ​ Consolidated Operating Income: For full year 2024, the Company expects consolidated operating income to approximate the $342.8 million achieved in 2023 and expects comparable seasonality to the prior year.
For the first quarter 2025, the Company expects Logistics operating income to be modestly lower than the $9.3 million achieved in the first quarter 2024. 31 Table of Contents ​ Consolidated Operating Income: For the first quarter 2025, the Company expects consolidated operating income to be meaningfully higher than the $36.9 million achieved in the first quarter 2024.
In the near-term, the Company expects continued economic growth in Alaska supported by a low unemployment rate, jobs growth and lower levels of inflation.
The increase was primarily due to higher northbound volume, partially offset by an additional sailing in the year ago period. In the near term, the Company expects continued economic growth in Alaska supported by a low unemployment rate, jobs growth and continued oil and gas exploration and production activity.
The Company also expects average freight rates in 2024 to be modestly higher than the levels achieved in 2023. ​ In Guam, the Company’s container volume in the fourth quarter 2023 increased 2.0 percent year-over-year primarily due to higher general demand.
However, if the Red Sea remains disrupted through year end, the Company expects freight rates to remain elevated throughout the year. ​ In Guam, the Company’s container volume in the fourth quarter 2024 decreased 10.0 percent year-over-year. The decrease was primarily due to lower demand from retail and food and beverage segments.
In the first quarter 2024, the Company expects Ocean Transportation operating income to be lower than the $27.8 million achieved in the first quarter 2023. ​ Logistics: In the fourth quarter 2023, operating income for the Company’s Logistics segment was $8.9 million, or $3.9 million lower compared to the level achieved in the fourth quarter 2022.
However, if trade conditions in the Red Sea remain disrupted through year end and there are no significant changes from today in the other factors noted above, the Company expects full year 2025 Ocean Transportation operating income to approach the level achieved in 2024. ​ Logistics: In the fourth quarter 2024, operating income for the Company’s Logistics segment was $10.1 million, or $1.2 million higher compared to the level achieved in the fourth quarter 2023.
For 2024, the Company expects volume to approximate the level achieved last year. ​ In Alaska, the Company’s container volume for the fourth quarter 2023 decreased 0.6 percent year-over-year due to lower export seafood volume from the Alaska-Asia Express service (“AAX”), partially offset by higher northbound volume due to an additional sailing and higher southbound volume due to higher domestic seafood volume.
In the near term, the Company expects Guam’s economy to grow modestly supported by a low unemployment rate and an increase in construction activity. For the full year 2025, the Company expects volume to be modestly higher than the level achieved last year. ​ In Alaska, the Company’s container volume for the fourth quarter 2024 increased 1.1 percent year-over-year.
Removed
(2) Income tax for the year ended December 31, 2019 includes a non-cash income tax benefit of $2.9 million related to the remeasurement of the Company’s deferred assets and liabilities and other discrete adjustments as a result of applying the Tax Cut and Jobs Act of 2017.
Added
The decrease was primarily due to lower general demand. Hawaii’s economy is expected to continue to grow slowly supported by modest gains in tourism, a low unemployment rate, and increased construction activity, but partially restrained by continued challenges in population growth and lower discretionary income as a result of high inflation and interest rates.
Removed
The decrease was primarily due to lower general demand. According to UHERO’s most recent forecast report, the Hawaii economy is projected to grow modestly despite challenged growth in visitor arrivals primarily due to reduced tourism to Maui as a result of the wildfires last year and sluggish recovery of international tourism.
Added
The Company’s container volume in the fourth quarter 2024 also increased 7.2 percent year-over-year due to seasonally stronger freight demand. The elevated freight rates in the fourth quarter 2024 were supported by a resilient U.S. economy and a stable consumer demand environment coupled with tighter supply chain conditions.
Removed
The increase was primarily due to higher demand for the China service resulting in higher volumes for both CLX and CLX+. The Company achieved lower freight rates in the fourth quarter 2023 as compared to the prior year period.
Added
The Company expects elevated freight rates to continue into the first quarter 2025. Beyond the first quarter, the Company expects freight rates will largely be driven by the timing of trade flow normalization in the Red Sea, other geopolitical factors, supply chain activity and the trajectory of the U.S. economy.
Removed
Currently in the Transpacific marketplace, the Company continues to see steady U.S. consumer demand, which the Company expects to lead to similar demand for Matson’s CLX and CLX+ services in 2024 as in 2023 .
Added
With respect to the Red Sea, assuming trade conditions normalize by the middle of the year, the Company expects freight rates to moderate in the second half of the year.
Removed
In the near-term, the Company expects continued improvement in the Guam economy with a low unemployment rate and a modest increase in tourism.
Added
The decrease was due to a $18.4 million impairment charge related to the write-down of a terminal operating lease asset, partially offset by higher year-over-year lift volume. On an after-tax basis, the impairment charge impacted fourth quarter 2024 net income and diluted EPS by $14.0 million and $0.42 per share, respectively.
Removed
For 2024, the Company expects the contribution from SSAT to be higher than the levels achieved in 2023 due to an expected increase in lift volumes. ​ Absent a significant change in trajectory of the U.S. economy, the Company expects trade dynamics across all its tradelanes in 2024 to be comparable to 2023 as consumer- related spending activity is expected to remain stable and, as noted above, the Company also expects increased operating income contributions from SSAT.
Added
For 2025, the Company expects the contribution from SSAT to approximate the level achieved in 2024, without taking into account the $18.4 million impairment charge in the fourth quarter 2024. ​ Based on the outlook trends noted above, the Company expects Ocean Transportation operating income for the first quarter 2025 to be meaningfully higher than the $27.6 million achieved in the first quarter 2024.
Removed
As such, the Company expects full year 2024 Ocean Transportation operating income to be higher than the $294.8 million achieved in 2023.
Added
For full year 2025, the Company expects Ocean Transportation operating income to be largely driven by the timing of trade flow normalization in the Red Sea, other geopolitical factors, supply chain activity and the trajectory of the U.S. economy.
Removed
Changes in prepaid expenses and other assets were primarily due to a decrease in prepaid income taxes at the end of December 31, 2023 as compared to the prior year. Changes in accounts payable, accruals and other liabilities were primarily due to the timing of payments associated with those liabilities.
Added
Assuming trade conditions in the Red Sea normalize by the middle of the year and there are no significant changes from today in the other factors referenced above, the Company expects full year 2025 Ocean Transportation operating income to be moderately lower than the $500.9 million achieved in 2024.
Removed
During the year ended December 31, 2021, the Company paid $71.8 million, net, to fully repay the Company’s revolving credit facility. There were no borrowings under the revolving credit facility during the years ended December 31, 2023 and 2022. ​ Capital Construction Fund: The Company utilizes its CCF to fund milestone payments for the construction of new vessels.
Added
For full year 2025, the Company expects consolidated operating income to be largely driven by the timing of trade flow normalization in the Red Sea, other geopolitical factors, supply chain activity and the trajectory of the U.S. economy.
Removed
During the years ended December 31, 2023 and 2022, the Company made withdrawals of $49.9 million and $64.6 million out of the CCF, respectively, which were used to make milestone payments for the construction of new vessels. Cash on deposit in the CCF is held in short term U.S.
Added
Assuming trade conditions in the Red Sea normalize by the end of the first half of the year and there are no significant changes from today in the other factors referenced above, the Company expects full year 2025 consolidated operating income to be moderately lower than the $551.3 million achieved in 2024.
Removed
Assigned accounts receivable in the CCF are classified as part of accounts receivable in the Consolidated Balance Sheets due to the nature of the assignment. ​ In February 2024, the Company purchased approximately $450 million of fixed-rate U.S. Treasuries with CCF cash deposits.
Added
The increase in interest income was due to interest of $10.2 million earned on a federal income tax refund received during the year ended December 31, 2024.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeA one percent change in the New Zealand dollar exchange rate is not expected to have a material effect on the Company’s results of operations. ​ ​ 41 Table of Contents
Biggest changeA one percent change in the New Zealand dollar exchange rate is not expected to have a material effect on the Company’s results of operations. ​ ​ 40 Table of Contents

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