x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
|
|
SECURITIES EXCHANGE ACT OF 1934
|
|
For the quarterly period ended March 31, 2013
|
|
OR
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
|
|
SECURITIES EXCHANGE ACT OF 1934
|
|
For the transition period from ______________________ to _________________
|
|
Commission file number 001-35492
|
|
(Exact name of registrant as specified in its charter)
|
Hawaii
|
45-4849780
|
(State or other jurisdiction of
incorporation or organization)
|
(I.R.S. Employer
Identification No.)
|
P. O. Box 3440, Honolulu, Hawaii
822 Bishop Street, Honolulu, Hawaii
(Address of principal executive offices)
|
9680l
96813
(Zip Code)
|
|
(808) 525-6611
|
|
(Registrant’s telephone number, including area code)
|
|
N/A
|
|
(Former name, former address, and former
|
|
fiscal year, if changed since last report)
|
Large accelerated filer x
|
Accelerated filer o
|
Non-accelerated filer o (Do not check if a smaller reporting company)
|
Smaller reporting company o
|
|
Number of shares of common stock outstanding as of March 31, 2013: 43,048,713
|
Three Months Ended
|
|||||||
March 31,
|
|||||||
2013
|
2012
|
||||||
Operating Revenue:
|
|||||||
Real estate leasing
|
$
|
26.3
|
$
|
25.1
|
|||
Real estate development and sales
|
0.5
|
2.5
|
|||||
Agribusiness
|
14.7
|
13.6
|
|||||
Total operating revenue
|
41.5
|
41.2
|
|||||
Operating Costs and Expenses:
|
|||||||
Cost of real estate leasing
|
15.0
|
14.2
|
|||||
Cost of real estate development and sales
|
0.1
|
1.0
|
|||||
Costs of agribusiness revenues
|
10.8
|
10.1
|
|||||
Selling, general and administrative
|
8.6
|
8.0
|
|||||
Separation costs
|
--
|
1.7
|
|||||
Total operating costs and expenses
|
34.5
|
35.0
|
|||||
Operating Income
|
7.0
|
6.2
|
|||||
Other Income and (Expense):
|
|||||||
Income (loss) related to real estate joint ventures
|
0.5
|
(1.6
|
)
|
||||
Interest expense
|
(3.6
|
)
|
(4.1
|
)
|
|||
Income From Continuing Operations Before Income Taxes
|
3.9
|
0.5
|
|||||
Income tax expense
|
1.6
|
0.2
|
|||||
Income From Continuing Operations
|
2.3
|
0.3
|
|||||
Income From Discontinued Operations (net of income taxes)
|
2.7
|
2.5
|
|||||
Net Income
|
$
|
5.0
|
$
|
2.8
|
|||
Basic Earnings Per Share:
|
|||||||
Continuing operations
|
$
|
0.05
|
$
|
0.01
|
|||
Discontinued operations
|
0.07
|
0.06
|
|||||
Net income
|
$
|
0.12
|
$
|
0.07
|
|||
Diluted Earnings Per Share:
|
|||||||
Continuing operations
|
$
|
0.05
|
$
|
0.01
|
|||
Discontinued operations
|
0.07
|
0.06
|
|||||
Net income
|
$
|
0.12
|
$
|
0.07
|
|||
Weighted Average Number of Shares Outstanding:
|
|||||||
Basic
|
43.0
|
42.4
|
|||||
Diluted
|
43.6
|
42.4
|
Three Months Ended
|
|||||||
March 31,
|
|||||||
2013
|
2012
|
||||||
Net Income
|
$
|
5.0
|
$
|
2.8
|
|||
Other Comprehensive Income:
|
|||||||
Defined benefit pension plans:
|
|||||||
Amortization of prior service cost (credit) included in net periodic pension cost
|
(0.3
|
)
|
0.1
|
||||
Amortization of net loss included in net periodic pension cost
|
2.0
|
1.2
|
|||||
Income taxes
|
(0.7
|
)
|
(0.5
|
)
|
|||
Other Comprehensive Income
|
1.0
|
0.8
|
|||||
Comprehensive Income
|
$
|
6.0
|
$
|
3.6
|
March 31,
|
December 31,
|
|||||||
2013
|
2012
|
|||||||
ASSETS
|
||||||||
Current Assets:
|
||||||||
Cash and cash equivalents
|
$
|
1.2
|
$
|
1.1
|
||||
Accounts receivable, net
|
9.5
|
8.2
|
||||||
Inventories
|
47.8
|
23.5
|
||||||
Real estate held for sale
|
1.5
|
11.5
|
||||||
Deferred income taxes
|
7.8
|
7.8
|
||||||
Prepaid expenses and other assets
|
6.8
|
11.3
|
||||||
Total current assets
|
74.6
|
63.4
|
||||||
Investments in Affiliates
|
324.4
|
319.9
|
||||||
Real Estate Developments
|
147.7
|
144.0
|
||||||
Property – net
|
862.6
|
838.7
|
||||||
Other Assets
|
80.7
|
71.3
|
||||||
Total assets
|
$
|
1,490.0
|
$
|
1,437.3
|
||||
LIABILITIES AND EQUITY
|
||||||||
Current Liabilities:
|
||||||||
Notes payable and current portion of long-term debt
|
$
|
20.3
|
$
|
15.5
|
||||
Accounts payable
|
24.2
|
26.2
|
||||||
Accrued interest
|
1.7
|
5.2
|
||||||
Accrued and other liabilities
|
22.8
|
22.7
|
||||||
Total current liabilities
|
69.0
|
69.6
|
||||||
Long-term Liabilities:
|
||||||||
Long-term debt
|
270.0
|
220.0
|
||||||
Deferred income taxes
|
148.1
|
152.9
|
||||||
Accrued pension and postretirement benefits
|
58.8
|
58.9
|
||||||
Other non-current liabilities
|
23.0
|
21.5
|
||||||
Total long-term liabilities
|
499.9
|
453.3
|
||||||
Commitments and Contingencies (Note 3)
|
||||||||
Equity:
|
||||||||
Common stock
|
940.4
|
939.8
|
||||||
Preferred stock
|
--
|
--
|
||||||
Accumulated other comprehensive loss
|
(46.2
|
)
|
(47.2
|
)
|
||||
Retained earnings
|
26.9
|
21.8
|
||||||
Total equity
|
921.1
|
914.4
|
||||||
Total liabilities and equity
|
$
|
1,490.0
|
$
|
1,437.3
|
Three Months Ended
|
||||||||
March 31,
|
||||||||
2013
|
2012
|
|||||||
Cash Flows used in Operating Activities:
|
(25.2
|
)
|
(26.9
|
)
|
||||
Cash Flows from Investing Activities:
|
||||||||
Capital expenditures for properties and developments
|
(6.5
|
)
|
(4.9
|
)
|
||||
Proceeds from disposal of income-producing properties and other assets
|
0.1
|
0.8
|
||||||
Payments for purchases of investments in affiliates
|
(4.7
|
)
|
(6.9
|
)
|
||||
Proceeds from investments in affiliates
|
0.6
|
0.1
|
||||||
Net cash used in investing activities
|
(10.5
|
)
|
(10.9
|
)
|
||||
Cash Flows from Financing Activities:
|
||||||||
Proceeds from issuances of long-term debt
|
35.0
|
44.0
|
||||||
Payments of long-term debt and deferred financing costs
|
(5.2
|
)
|
(13.1
|
)
|
||||
Proceeds from line-of-credit agreements, net
|
4.5
|
3.9
|
||||||
Contributions from Alexander & Baldwin Holdings, Inc., net
|
--
|
0.3
|
||||||
Proceeds from stock option exercises, including excess tax benefit
|
1.5
|
--
|
||||||
Net cash provided by financing activities
|
35.8
|
35.1
|
||||||
Cash and Cash Equivalents:
|
||||||||
Net increase (decrease) for the period
|
0.1
|
(2.7
|
)
|
|||||
Balance, beginning of period
|
1.1
|
11.7
|
||||||
Balance, end of period
|
$
|
1.2
|
$
|
9.0
|
||||
Other Cash Flow Information:
|
||||||||
Interest paid
|
$
|
(7.2
|
)
|
$
|
(5.4
|
)
|
||
Income taxes paid
|
$
|
(0.8
|
)
|
$
|
(1.5
|
)
|
||
Other Non-cash Information:
|
||||||||
Depreciation and amortization expense
|
$
|
9.0
|
$
|
8.6
|
||||
Tax-deferred property sales
|
$
|
14.7
|
$
|
8.9
|
||||
Tax-deferred property purchases
|
$
|
(9.8
|
)
|
$
|
--
|
|||
Note payable assumed in connection with acquisition of Waianae Mall
|
$
|
19.7
|
$
|
--
|
||||
Capital expenditures included in accounts payable and accrued expenses
|
$
|
6.5
|
$
|
9.5
|
(1)
|
Description of Business. Prior to June 29, 2012, A&B’s businesses included Matson Navigation Company Inc., a wholly owned subsidiary that provided ocean transportation, truck brokerage and intermodal services. As part of a strategic initiative designed to allow A&B to independently execute its strategies and to best enhance and maximize its earnings, growth prospects and shareholder value, A&B made a decision to separate the transportation businesses from the Hawaii real estate and agriculture businesses. In preparation for the separation, A&B modified its legal-entity structure and became a wholly owned subsidiary of a newly created entity, Alexander & Baldwin Holdings, Inc. (“Holdings”). On June 29, 2012, Holdings distributed to its shareholders all of the common stock of A&B stock in a tax-free distribution (the “Separation”). Holders of Holdings common stock continued to own the transportation businesses, but also received one share of A&B common stock for each share of Holdings common stock held at the close of business on June 18, 2012, the record date. Following the Separation, Holdings changed its name to Matson, Inc. On July 2, 2012, A&B began regular trading on the New York Stock Exchange under the ticker symbol “ALEX” as an independent, public company. A&B is headquartered in Honolulu and conducts business in three operating segments in two industries—Real Estate and Agribusiness. These industries are described below:
|
|
Real Estate: Real Estate consists of two segments, both of which have operations in Hawaii and on the Mainland. The Real Estate Development and Sales segment generates its revenues through the development and sale of land and commercial and residential properties. The Real Estate Leasing segment owns, operates, and manages retail, office, and industrial properties. Real estate activities are conducted through A&B Properties, Inc. and various other wholly owned subsidiaries of A&B.
|
|
Agribusiness: Agribusiness, which contains one segment, produces bulk raw sugar, specialty food grade sugars, and molasses; markets and distributes specialty food-grade sugars; provides general trucking services, mobile equipment maintenance, and repair services in Hawaii; leases agricultural land to third parties; and generates and sells electricity, to the extent not used in the Company’s Agribusiness operations.
|
(2)
|
Basis of Presentation. The financial statements and related financial information pertaining to the period preceding the Separation have been presented on a combined basis and reflect the financial position, results of operations and cash flows of the real estate and agriculture businesses and corporate functions of Alexander & Baldwin, Inc., all of which were under common ownership and common management prior to the Separation. The financial statements and related financial information pertaining to the period subsequent to the Separation have been presented on a consolidated basis. The financial statements for periods prior to the Separation included herein may not necessarily reflect A&B’s results of operations, financial position and cash flows in the future or what its results of operations, financial position and cash flows would have been had A&B been a stand-alone company during the periods presented.
|
|
The condensed consolidated financial statements are unaudited. Because of the nature of the Company’s operations, the results for interim periods are not necessarily indicative of results to be expected for the year. While these condensed consolidated financial statements reflect all normal recurring adjustments that are, in the opinion of management, necessary for fair presentation of the results of the interim period, they do not include all of the information and footnotes required by U.S. generally accepted accounting principles (GAAP) for complete financial statements. Therefore, the interim condensed consolidated financial statements should be read in conjunction with the consolidated balance sheets as of December 31, 2012 and 2011, and the related consolidated statements of income, comprehensive income, equity, and cash flows for each of the three years in the period ended December 31, 2012 and the notes thereto included in the Company’s Annual Report filed on Form 10-K for the year ended December 31, 2012.
|
|
Rounding:. Amounts in the consolidated financial statement and Notes are rounded to the nearest tenth of a million, but per-share calculations and percentages were determined based on amounts before rounding. Accordingly, a recalculation of some per-share amounts and percentages, if based on the reported data, may be slightly different.
|
(3)
|
Commitments, Guarantees and Contingencies: Commitments and financial arrangements, excluding lease commitments that are disclosed in Note 8 of the Company’s Annual Report filed on Form 10-K for the year ended December 31, 2012, included the following (in millions):
|
Standby letters of credit related to real estate development projects
|
$12.2
|
||
Performance bonds related to real estate construction
|
$21.7
|
(4)
|
Earnings Per Share (“EPS”). The computation of basic and diluted earnings per common share for all periods prior to Separation is calculated using the number of shares of A&B common stock outstanding on July 2, 2012, the first day of trading following the June 29, 2012 distribution of A&B common stock to Holdings shareholders, as if those shares were outstanding for those periods. Additionally, for all periods prior to Separation, there were no dilutive shares because no actual A&B shares or share-based awards were outstanding prior to the Separation.
|
|
Earnings Per Share (“EPS”): The number of shares used to compute basic and diluted earnings per share is as follows (in millions):
|
Quarter Ended
March 31,
|
||||||
2013
|
2012
|
|||||
Denominator for basic EPS – weighted average shares
|
43.0
|
42.4
|
||||
Effect of dilutive securities:
|
||||||
Employee/director stock options and restricted stock units
|
0.6
|
--
|
||||
Denominator for diluted EPS – weighted average shares
|
43.6
|
42.4
|
(5)
|
Fair Value of Financial Instruments. The fair values of receivables and short-term borrowings approximate their carrying values due to the short-term nature of the instruments. The Company’s cash and cash equivalents, consisting principally of cash on deposit, may from time to time include short-term money markets funds. The fair values of these money market funds, based on market prices (level 2), approximate their carrying values due to their short-maturities. The carrying amount and fair value of the Company’s long-term debt at March 31, 2013 was $270.0 million and $297.0 million, respectively, and $220.0 million and $249.0 million at December 31, 2012, respectively. The fair value of long-term debt is calculated by discounting the future cash flows of the debt at rates based on instruments with similar risk, terms and maturities as compared to the Company’s existing debt arrangements (level 2).
|
|
|
(6)
|
Share-Based Compensation. Under the 2012 Plan, 4.3 million shares of common stock were initially reserved for issuance, and as of March 31, 2013, 1,509,274 shares of the Company’s common stock remained available for future issuance. The shares of common stock authorized to be issued under the 2012 Plan may be drawn from the shares of the Company’s authorized but unissued common stock or from shares of its common stock that the Company acquires, including shares purchased on the open market or in private transactions.
|
Weighted
|
Weighted
|
|||||||||
Average
|
Average
|
Aggregate
|
||||||||
2012
|
Exercise
|
Contractual
|
Intrinsic
|
|||||||
Plan
|
Price
|
Life
|
Value
|
|||||||
Outstanding, January 1, 2013
|
1,722.7
|
$19.41
|
||||||||
Exercised
|
(44.3
|
)
|
$20.01
|
|||||||
Forfeited and expired
|
(1.2
|
)
|
$19.80
|
|||||||
Outstanding, March 31, 2013
|
1,677.2
|
$19.39
|
5.6
|
$27,124
|
||||||
Exercisable, March 31, 2013
|
1,481.3
|
$19.15
|
5.2
|
$24,319
|
2012
|
|||||||
Plan
|
Weighted
|
||||||
Restricted
|
Average
|
||||||
Stock
|
Grant-Date
|
||||||
Units
|
Fair Value
|
||||||
Outstanding, January 1, 2013
|
330.0
|
$20.43
|
|||||
Granted
|
99.9
|
$34.13
|
|||||
Vested
|
(140.3
|
)
|
$18.01
|
||||
Canceled
|
(49.4
|
)
|
$22.53
|
||||
Outstanding, March 31, 2013
|
240.2
|
$27.11
|
Quarter Ended
|
||||||||||
March 31,
|
||||||||||
2013
|
2012
|
|||||||||
Share-based expense (net of estimated forfeitures):
|
||||||||||
Stock options
|
$
|
0.4
|
$
|
0.3
|
||||||
Restricted stock units
|
0.7
|
1.0
|
||||||||
Total share-based expense
|
1.1
|
1.3
|
||||||||
Total recognized tax benefit
|
(0.3
|
)
|
(0.4
|
)
|
||||||
Share-based expense (net of tax)
|
$
|
0.8
|
$
|
0.9
|
(7)
|
Discontinued Operations. The revenues and expenses of Northpoint Industrial, an industrial property in California that was sold in the first quarter of 2013, have been classified as discontinued operations. In 2012, the revenues and expenses of two leased fee properties on Maui and Firestone Boulevard Building, a California office property, were classified as discontinued operations due to the sale of the properties.
|
Quarter Ended
|
||||||||
March 31,
|
||||||||
2013
|
2012
|
|||||||
Proceeds from the sale of income-producing properties
|
$
|
14.9
|
$
|
8.9
|
||||
Real estate leasing revenue
|
--
|
0.4
|
||||||
Gain on sale of income-producing properties
|
4.2
|
3.9
|
||||||
Real estate leasing operating profit
|
--
|
0.2
|
||||||
Total operating profit before taxes
|
4.2
|
4.1
|
||||||
Income tax expense
|
(1.5
|
)
|
(1.6
|
)
|
||||
Income from discontinued operations
|
$
|
2.7
|
$
|
2.5
|
(8)
|
Pension and Post-retirement Plans. The Company has defined benefit pension plans that cover substantially all non-bargaining unit and certain bargaining unit employees. The Company also has unfunded non-qualified plans that provide benefits in excess of the amounts permitted to be paid under the provisions of the tax law to participants in qualified plans.
|
|
In 2007, the Company changed the traditional defined benefit pension plan formula for new non-bargaining unit employees hired after January 1, 2008 and replaced it with a cash balance defined benefit pension plan formula. Subsequently, effective January 1, 2012, the Company changed the benefits under its traditional defined benefit plans for non-bargaining unit employees hired before January 1, 2008 and replaced the benefit with the same cash balance defined benefit pension plan formula provided to those employees hired after January 1, 2008. Retirement benefits under the cash balance pension plan formula are based on a fixed percentage of employee eligible compensation, plus interest. The plan interest credit rate will vary from year-to-year based on the ten-year U.S. Treasury rate.
|
|
The assumptions related to discount rates, expected long-term rates of return on invested plan assets, salary increases, age, mortality and health care cost trend rates, along with other factors, are used in determining the assets, liabilities and expenses associated with pension benefits. Management reviews the assumptions annually with its independent actuaries, taking into consideration existing and future economic conditions and the Company’s intentions with respect to these plans. Management believes that its assumptions and estimates are reasonable. Different assumptions, however, could result in material changes to the assets, obligations and costs associated with benefit plans.
|
Pension Benefits
|
Post-retirement Benefits
|
|||||||||||||||
2013
|
2012
|
2013
|
2012
|
|||||||||||||
Service cost
|
$
|
0.6
|
$
|
0.9
|
$
|
0.1
|
$
|
0.1
|
||||||||
Interest cost
|
2.1
|
2.4
|
0.2
|
0.2
|
||||||||||||
Expected return on plan assets
|
(2.6
|
)
|
(2.8
|
)
|
--
|
--
|
||||||||||
Amortization of prior service cost (credit)
|
(0.2
|
)
|
0.1
|
--
|
--
|
|||||||||||
Amortization of net loss
|
2.0
|
1.6
|
--
|
--
|
||||||||||||
Net periodic benefit cost
|
$
|
1.9
|
$
|
2.2
|
$
|
0.3
|
$
|
0.3
|
(9)
|
New Accounting Pronouncements. In February 2013, the Financial Accounting Standards Board issued Accounting Standards Update (ASU) 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income (“ASU 2013-02”). This update requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, ASU 2013-02 requires presentation, either on the face of the income statement or in the notes, of significant amounts reclassified out of accumulated other comprehensive income by respective line items of net income, but only if the amounts reclassified are required to be reclassified in their entirety in the same reporting period. For amounts that are not required to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures that provide additional details about these amounts. The amendments in ASU 2013-02 are to be applied prospectively and are effective for fiscal years and interim periods within those years, beginning after December 15, 2012. The Company adopted the standard effective January 1, 2013 with prospective application. The adoption of ASU 2013-02 changed the presentation of the Company’s financial statements and related footnotes, but did not affect the calculation of net income, comprehensive income or earnings per share.
|
(10)
|
Accumulated Other Comprehensive Income. The changes in accumulated other comprehensive income by component for the three months ended March 31, 2013 were as follows (in millions, net of tax):
|
Pension and postretirement plans
|
|||||
Beginning balance, January 1, 2013
|
$
|
47.2
|
|||
Amounts reclassified from accumulated other comprehensive income, net of tax
|
(1.0
|
)
|
|||
Ending balance, March 31, 2013
|
$
|
46.2
|
|
The reclassifications of other comprehensive income components out of accumulated other comprehensive income for the three months ended March 31, 2013 were as follows (in millions):
|
Amounts Reclassified from Accumulated Other Comprehensive Income for the Three Months Ended
|
|||||
Details about Accumulated Other Comprehensive Income Components
|
March 31, 2013
|
||||
Amortization of defined benefit pension items reclassified to net periodic pension cost:
|
|||||
Actuarial loss*
|
$
|
2.0
|
|||
Prior service credit*
|
(0.3
|
)
|
|||
Total before income tax
|
1.7
|
||||
Income taxes
|
(0.7
|
)
|
|||
Other comprehensive income net of tax
|
$
|
1.0
|
|
*
|
These accumulated other comprehensive income components are included in the computation of net periodic pension cost (see Note 8 for additional details).
|
Income Taxes. The Company is included in the consolidated tax return of Matson, Inc. (formerly Alexander & Baldwin Holdings, Inc.) for results occurring prior to June 30, 2012. Subsequent to June 30, 2012, the Company will report as a separate taxpayer. The current and deferred income tax expense recorded in the condensed consolidated financial statements has been determined by applying the provisions of ASC 740 as if the Company were a separate taxpayer.
|
|
The Company makes certain estimates and judgments in determining income tax expense for financial statement purposes. These estimates and judgments are applied in the calculation of tax credits, tax benefits and deductions, and in the calculation of certain deferred tax assets and liabilities, which arise from differences in the timing of recognition of revenue and expense for tax and financial statement purposes. Deferred tax assets and deferred tax liabilities are adjusted to the extent necessary to reflect tax rates expected to be in effect when the temporary differences reverse. Adjustments may be required to deferred tax assets and deferred tax liabilities due to changes in tax laws and audit adjustments by tax authorities. To the extent adjustments are required in any given period, the adjustments would be included within the tax provision in the condensed consolidated statements of income or balance sheets.
|
(12)
|
Notes Payable and Long-Term Debt. On January 22, 2013, A&B completed the purchase of Waianae Mall, a 170,300 square-foot, 10-building retail center in Leeward Oahu, for $10.1 million in cash and the assumption of a $19.7 million loan (the “Loan”). The Promissory Note for the Loan is secured by a Mortgage, Assignment of Leases and Rents and Security Agreement, bears interest at 5.39 percent, and requires monthly payments of principal and interest totaling $124,552. A final balloon payment of $18.5 million is due on October 5, 2015. In connection with the loan assumption, the Company has also provided a limited guaranty for the payment of all obligations under the Loan. The guaranty is limited to 10 percent of the outstanding principal balance of the Loan upon the occurrence of an event of default, plus any cost incurred by the lender.
|
(13)
|
Segment Results. Segment results for the three months ended March 31, 2013 and 2012 were as follows (in millions):
|
Three Months Ended
|
|||||||
March 31,
|
|||||||
2013
|
2012
|
||||||
Revenue:
|
|||||||
Real Estate1:
|
|||||||
Leasing
|
$
|
26.3
|
$
|
25.5
|
|||
Development and Sales
|
15.4
|
11.4
|
|||||
Less amounts reported in discontinued operations
|
(14.9
|
)
|
(9.3
|
)
|
|||
Agribusiness
|
14.7
|
13.6
|
|||||
Total revenue
|
$
|
41.5
|
$
|
41.2
|
|||
Operating Profit, Net Income:
|
|||||||
Real Estate1:
|
|||||||
Leasing
|
$
|
10.9
|
$
|
10.7
|
|||
Development and Sales
|
2.4
|
0.9
|
|||||
Less amounts reported in discontinued operations
|
(4.2
|
)
|
(4.1
|
)
|
|||
Agribusiness
|
3.8
|
3.5
|
|||||
Total operating profit
|
12.9
|
11.0
|
|||||
Interest Expense
|
(3.6
|
)
|
(4.1
|
)
|
|||
General Corporate Expenses
|
(5.4
|
)
|
(4.7
|
)
|
|||
Separation Costs
|
--
|
(1.7
|
)
|
||||
Income From Continuing Operations Before
Income Taxes
|
3.9
|
0.5
|
|||||
Income Tax Expense
|
1.6
|
0.2
|
|||||
Income From Continuing Operations
|
2.3
|
0.3
|
|||||
Income From Discontinued Operations (net of income taxes)
|
2.7
|
2.5
|
|||||
Net Income
|
$
|
5.0
|
$
|
2.8
|
|
•
|
Business Overview: This section provides a general description of A&B’s business, as well as recent developments that the Company believes are important in understanding its results of operations and financial condition or in understanding anticipated future trends.
|
|
•
|
Consolidated Results of Operations: This section provides an analysis of A&B’s consolidated results of operations for the three months ended March 31, 2013 and 2012.
|
|
•
|
Analysis of Operating Revenue and Profit by Segment: This section provides an analysis of A&B’s results of operations by business segment.
|
|
•
|
Liquidity and Capital Resources: This section provides a discussion of A&B’s financial condition and an analysis of A&B’s cash flows for the three months ended March 31, 2013 and 2012, as well as a discussion of A&B’s ability to fund the its future commitments and ongoing operating activities through internal and external sources of capital.
|
|
•
|
Outlook: This section provides a discussion of management’s general outlook about the Hawaii economy and the Company’s markets.
|
|
•
|
Other Matters: This section provides a summary of other matters, such as officer and management changes.
|
Quarter Ended March 31,
|
||||||||||
(dollars in millions)
|
2013
|
2012
|
Change
|
|||||||
Operating revenue
|
$
|
41.5
|
$
|
41.2
|
1
|
%
|
||||
Operating costs and expenses
|
34.5
|
35.0
|
-1
|
%
|
||||||
Operating income
|
7.0
|
6.2
|
13
|
%
|
||||||
Other income and (expense)
|
(3.1
|
)
|
(5.7
|
)
|
-46
|
%
|
||||
Income from continuing operations before income taxes
|
3.9
|
0.5
|
8
|
X
|
||||||
Income tax expense
|
1.6
|
0.2
|
8
|
X
|
||||||
Discontinued operations (net of income taxes)
|
2.7
|
2.5
|
8
|
%
|
||||||
Net income
|
$
|
5.0
|
$
|
2.8
|
79
|
%
|
||||
Basic earnings per share
|
$
|
0.12
|
$
|
0.07
|
71
|
%
|
||||
Diluted earnings per share
|
$
|
0.12
|
$
|
0.07
|
71
|
%
|
Quarter Ended March 31,
|
||||||||||
(dollars in millions)
|
2013
|
2012
|
Change
|
|||||||
Real estate leasing segment revenue
|
$
|
26.3
|
$
|
25.5
|
3
|
%
|
||||
Real estate leasing segment operating costs and expenses
|
(15.0
|
)
|
(14.4
|
)
|
4
|
%
|
||||
Selling, general and administrative
|
(0.5
|
)
|
(0.5
|
)
|
--
|
|||||
Other income
|
0.1
|
0.1
|
--
|
|||||||
Real estate leasing operating profit
|
$
|
10.9
|
$
|
10.7
|
2
|
%
|
||||
Operating profit margin
|
41.4
|
%
|
42.0
|
%
|
||||||
Average Occupancy Rates:
|
||||||||||
Mainland
|
95
|
%
|
93
|
%
|
||||||
Hawaii
|
92
|
%
|
91
|
%
|
||||||
Leasable Space (million sq. ft.) — Improved
|
||||||||||
Mainland
|
6.3
|
6.5
|
||||||||
Hawaii
|
1.6
|
1.4
|
Dispositions
|
Acquisitions
|
|||||
Date
|
Property
|
Leasable sq. ft
|
Date
|
Property
|
Leasable sq. ft
|
|
1-13
|
Northpoint Industrial
|
119,400
|
6-12
|
Gateway at Mililani Mauka South
|
18,700
|
|
1-13
|
Waianae Mall
|
170,300
|
||||
Total Dispositions
|
119,400
|
Total Acquisitions
|
189,000
|
Quarter Ended March 31,
|
||||||||||
(dollars in millions)
|
2013
|
2012
|
Change
|
|||||||
Improved property sales revenue
|
$
|
14.9
|
$
|
5.0
|
3
|
X
|
||||
Development sales revenue
|
--
|
1.4
|
N
|
M
|
||||||
Unimproved/other property sales revenue
|
0.5
|
5.0
|
-90
|
%
|
||||||
Total real estate development and sales segment revenue
|
15.4
|
11.4
|
35
|
%
|
||||||
Cost of real estate development and sales
|
(10.7
|
)
|
(6.0
|
)
|
78
|
%
|
||||
Operating expenses
|
(2.8
|
)
|
(3.0
|
)
|
-7
|
%
|
||||
Earnings (loss) from joint ventures
|
0.5
|
(1.6
|
)
|
N
|
M
|
|||||
Other income (loss)
|
--
|
0.1
|
N
|
M
|
||||||
Total real estate development and sales operating profit
|
$
|
2.4
|
$
|
0.9
|
3
|
X
|
||||
Real estate development and sales operating profit margin
|
15.6
|
%
|
7.9
|
%
|
Quarter Ended
|
||||||||
March 31,
|
||||||||
2013
|
2012
|
|||||||
Proceeds from the Sale of Income-Producing Properties
|
$
|
14.9
|
$
|
8.9
|
||||
Real Estate Leasing Revenue
|
$
|
--
|
$
|
0.4
|
||||
Gain on Sale of Income-Producing Properties
|
$
|
4.2
|
$
|
3.9
|
||||
Real Estate Leasing Operating Profit
|
--
|
0.2
|
||||||
Total Operating Profit Before Taxes
|
4.2
|
4.1
|
||||||
Income Tax Expense
|
(1.5
|
)
|
(1.6
|
)
|
||||
Income from Discontinued Operations
|
$
|
2.7
|
$
|
2.5
|
Quarter Ended March 31,
|
||||||||||
(dollars in millions)
|
2013
|
2012
|
Change
|
|||||||
Revenue
|
$
|
14.7
|
$
|
13.6
|
8
|
%
|
||||
Operating profit
|
$
|
3.8
|
$
|
3.5
|
9
|
%
|
||||
Operating profit margin
|
25.9
|
%
|
25.7
|
%
|
||||||
Tons sugar produced
|
8,200
|
1,900
|
4
|
X
|
||||||
Tons sugar sold
|
2,700
|
2,200
|
23
|
%
|
Property Type
|
First Quarter 2013
Vacancy Rate
|
Average Asking Rent Per Square Foot Per Month (NNN)
at March 31, 2013
|
Retail
|
5.1%
|
$4.36
|
Industrial
|
3.6%
|
$0.99
|
Office
|
12.9%
|
$1.54
|
(a)
|
Disclosure Controls and Procedures. The Company’s management, with the participation of the Company’s Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) as of the end of the period covered by this report. Based on such evaluation, the Company’s Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Company’s disclosure controls and procedures are effective.
|
|
(b)
|
Internal Control Over Financial Reporting. There have not been any changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.
|
Period
|
Total Number of
Shares Purchased
|
Average Price
Paid per Share
|
Total Number of
Shares Purchased as
Part of Publicly
Announced Plans
or Programs
|
Maximum Number
of Shares that
May Yet Be Purchased
Under the Plans
or Programs
|
Jan 1 - 31, 2013
|
58,045 (1)
|
$33.30
|
--
|
--
|
Feb 1 - 28, 2013
|
937 (1)
|
$35.22
|
--
|
--
|
Mar 1 - 31, 2013
|
2,844 (1)
|
$36.56
|
--
|
--
|
|
(1)
|
Represents shares accepted for the exercise of options and/or in satisfaction of tax withholding obligations arising upon option exercises or the vesting of restricted stock units.
|
|
31.1
|
Certification of Chief Executive Officer, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
31.2
|
Certification of Chief Financial Officer, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
32
|
Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101
|
The following information from Alexander & Baldwin, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2013, formatted in XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Statements of Income for the three months ended March 31, 2013, and March 31, 2012, (ii) Condensed Consolidated Statement of Comprehensive Income for the three months ended March 31, 2013, and March 31, 2012, (iii) Condensed Consolidated Balance Sheets at March 31, 2013 and December 31, 2012, (iv) Condensed Consolidated Statement of Cash Flows for the three months ended March 31, 2013, and March 31, 2012, and (v) the Notes to the Condensed Consolidated Financial Statements.
|
10.b.1(xxiii)
|
Amendment No. 1 to the Alexander & Baldwin, Inc. Excess Benefits Plan, effective as of March 1, 2013.
|
10.b.1.(xxvi)
|
Amendment No. 1 to Alexander & Baldwin, Inc. Retirement Plan for Outside Directors, effective as of March 1, 2013.
|
ALEXANDER & BALDWIN, INC.
|
||
(Registrant)
|
||
Date: May 10, 2013
|
/s/ Paul K. Ito
|
|
Paul K. Ito
|
||
Senior Vice President,
|
||
Chief Financial Officer, Treasurer
|
||
and Controller
|
||
|
31.1
|
Certification of Chief Executive Officer, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
31.2
|
Certification of Chief Financial Officer, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
32
|
Certification of Chief Executive Officer and Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101
|
The following information from Alexander & Baldwin, Inc.’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2013, formatted in XBRL (eXtensible Business Reporting Language): (i) Condensed Consolidated Statements of Income for the three months ended March 31, 2013, and March 31, 2012, (ii) Condensed Consolidated Statement of Comprehensive Income for the three months ended March 31, 2013, and March 31, 2012, (iii) Condensed Consolidated Balance Sheets at March 31, 2013 and December 31, 2012, (iv) Condensed Consolidated Statement of Cash Flows for the three months ended March 31, 2013, and March 31, 2012, and (v) the Notes to the Condensed Consolidated Financial Statements.
|
10.b.1(xxiii)
|
Amendment No. 1 to the Alexander & Baldwin, Inc. Excess Benefits Plan, effective as of March 1, 2013.
|
10.b.1.(xxvi)
|
Amendment No. 1 to Alexander & Baldwin, Inc. Retirement Plan for Outside Directors, effective as of March 1, 2013.
|