Molasses spill impacts Matson earnings
HONOLULU — The shipping company responsible for a molasses spill that killed more than 26,000 fish and other marine life in Hawaii said the incident is partly to blame for lower profits in the third quarter.
Matson Inc. on Wednesday reported net income of $17.2 million, or 40 cents per share, for the three months that ended Sept. 30.
That’s nearly 10 percent less than the $19.1 million, or 45 cents per share, during the third quarter last year.
Third-quarter revenue rose 3.4 percent to $415 million from $401.4 million during the same period last year.
President and CSO Matt Cox said $1.3 million in response costs, legal expenses and third-party claims related to the September spill contributed to the modest decrease in earnings.
The Honolulu-based company said government agencies haven’t provided an accounting of reimbursement claims for the spill and no lawsuits have been filed.
So Matson isn’t able to estimate future expenses related to the spill.
“Despite these third-quarter challenges, overall our ongoing ocean transportation and logistics operations performed well,” Cox said in a news release. “We are encouraged by the continuing strong demand for our premium service out of China and we believe performance in Guam will remain steady.”
In a conference call Wednesday explaining the financial results, the company provided an update about the spill, which occurred Sept. 9-10. The company said there has been no impact on container operations but the company’s molasses operations remain suspended.
The company was subpoenaed last month by a federal grand jury for documents related to the spill. Matson is fully cooperating with the subpoena, Cox said during the call. The company also received information requests on the spill from two Hawaii agencies and the U.S. Environmental Protection Agency.
The spill of 1,400 tons of molasses — about 233,000 gallons or enough to fill about seven rail cars— happened in an industrial area about 5 miles west of Waikiki’s hotels and beaches.
The molasses oozed out from a section of pipe Matson thought had been sealed off. It suffocated marine life and discolored the water as it sunk to the bottom of Honolulu Harbor. Cox said Wednesday the water was no longer abnormally discolored.
Matson executives have said they had not prepared for the possibility of a spill, despite transporting molasses from the pipeline for about 30 years.
Shares of Matson fell 38 cents, or 1.39 percent, to $26.97 Wednesday.
Follow Jennifer Sinco Kelleher at http://www.twitter.com/JenHapa .
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