Good afternoon and welcome to the Matson Incorporated Fourth Quarter 2012 Earnings Conference Call. All participants will be in listen-only mode. (Operator Instructions) After today’s presentation, there will be an opportunity to ask questions. (Operator Instructions) Please note this event is being recorded. I would now like to turn the conference over to Mr. Peter Hyleman, Corporate Secretary. Mr. Hyleman, please go ahead.

Thank you, Laura. Aloha and welcome to our fourth quarter and full year 2012 earnings conference call. Matt Cox, President and Chief Executive Officer is joining from Honolulu; while I’m going to open today with Joel Wine, Senior Vice President and Chief Financial Officer. Slides from this presentation are available for download at our website www.matson.com under the Investor Relations tab. Before we begin, I’d like to take this opportunity to remind you that during the course of this call, we will make forward-looking statements within the meaning of the Federal Securities Laws regarding expectations, predictions, projections or future events. We believe that our expectations and assumptions are reasonable. We caution you to consider the risk factors that could cause actual results to differ materially from those in the forward-looking statements, in the press release and this conference call. These risk factors are described in our press release and are more fully described under the caption Risk Factors on pages 19 through 29 of the 2011 Form 10-K filed by Alexander & Baldwin, Inc. on February 28, 2012, and in all of our other subsequent filings with the SEC. Please also note that the date of this conference call is February 7, 2013, and any forward-looking statements that we make today are based on assumptions as of this date. We undertake no obligation to update these forward-looking statements. Also, references made to certain non-GAAP numbers in this presentation, a reconciliation to GAAP numbers and description of calculation methodologies is provided in the addendum. With that, I will turn the call over to Matt, who will take us through the key highlights of the quarter, 2012, as well as an outlook for 2013. Matt?

Thanks, Peter. And thanks for those on the call and for your continuing interest in and support of Matson. We had a solid fourth quarter results in our Ocean Transportation segment led by continued strong loan volume and an improved rate environment in our expedited China service. In addition, we are able to return to an optimal fleet structure that is the nine-ship deployment in the fourth quarter that led to reduced vessel operating expenses and overhead. In early January, we acquired the primary assets of New Zealand based Reef Shipping, I will speak more about the acquisition later, but comment now that the purchase extends our network and opens up future opportunities at our transportation hubs. Just as important as our operational success, we continue to pay down our debt. During this quarter and pay down nearly $54 million since June reflects into the strong cash from operations and continuation of the core strategic plan. Unfortunately, we had a one-time impairment charge of an intangible asset and restructuring of a lease at Logistics’ Northern California warehouse operation. Together, these charges totaled $3.9 million and offset what if otherwise been a profitable quarter for the segment. Joe will speak in greater detail about these charges in a moment. On slide four, we present on a year-over-year basis EBITDA and earnings per share. We believe EBITDA provides information that is useful for our investors as it is a measure used by our management team to evaluate performance and make day-to-day operating decisions. In the fourth quarter of 2012, our EBITDA was $40.3 million, a $9.9 million increase from the fourth quarter of 2011, or an improvement of 32.6%. Earnings per share increased significantly although we note that fourth quarter 2011 results were adversely impacted by discontinued operations from our former parent…

Thanks, Matt. As shown on Slide 13, Matson’s consolidated operating income for the quarter was $23.9 million as compared to $11.8 million for the fourth quarter of 2011. As Matt mentioned, the improvement in results was driven primarily by the full quarter impact of being the sole care in the Guam trade and the increase in rates in the China trade. This improvement on the Ocean Transportation side was offset to some degree by the non-cash charges in Logistics. For the full-year 2012 as compared to 2011, operating income rose by 23% to $96.7 million primarily for the same reasons previously mentioned despite increased costs related to vessel and barge and dry-docking and related higher outside transportation costs. Turning to slide 14 at the segment level, Ocean Transportation’s operating income for the quarter was $26.7 million as compared to $12.5 million for the fourth quarter of 2011 and operating income margin was 8.8% during the quarter. Our operating income margins continue to improve, but are still below where we want them to be. As we have said before, we target a 10% to 12% annual margin on average and while we significantly improved during the quarter on a year-over-year basis, we remain below our target level. For the full year, operating income rose by $22.9 million or 31% for primarily the same reasons as is in the quarter. SSAT, our terminal operations joint venture is included in operating income for the Ocean Transportation segment, while it appears as a contra expense on our consolidated income statement. For the fourth quarter, SSAT operated at a breakeven level and for the full year contributed $3.2 million. Those levels are off by $1.7 million and $5.4 million respectively from prior-year levels due to the loss of volume by several major customers. Now turning…

Thanks, Joe. 2012 was a historic year for us at Matson. We celebrated our 130 anniversary and began trading as an independent company in early July. And we had another steady quarter that resulted in a satisfactory full year performance. Our Ocean Transportation segment performed well and showed a modest improvement in margins, but for the full year we were below our target margin of 10% to 12%. I think we can do better. And in order to do better, we will need to see a more meaningful increase in Hawaii construction activity. On the Logistics side, we continue to focus on organic growth in each of our lines of business. You have heard some of our efforts that are underway and these are starting to provide meaningful benefit. Our impairment charge was painful, but put the business back on solid footing. We made excellent progress in paying down our debt during the year and our balance sheet is in great shape. Together with our cash flow generation capabilities we are positioned to capture gains in the future weather through organic growth associated with the Hawaii and U.S. economic recoveries or through new growth opportunities. We are also positioned to fund potential new ship builds. And finally, we were pleased to acquire the assets of reshipping earlier this year. It is a small, but important growth platform for us and begins to widen our geography and markets while leveraging the core of our strength, serving island economy throughout the Pacific with time definite, reliable, world-class service. I will now turn the call over to the operator and open it up for questions.

(Operator Instructions) And our first question comes from Michael Webber of Wells Fargo. Michael Webber – Wells Fargo Securities : Hi, good morning guys, how are you or good afternoon?

Hi, Mike.

Good afternoon. Michael Webber – Wells Fargo Securities: I’m talking with too many companies in Europe I guess. First question is on volumes and Matt in your prepared remarks you kind of touched on the uptick and some of the macro data we saw for the line economy in the fourth quarter and you kind of parse out that new build permit – that new permitting data, it looks like its up 40% sequentially in the quarter and reflect the lowest unemployment in our way. So I guess kind of what I am getting out is, what kind of volume growth really looks like in 2013? I mean it seems like the bleeding has stopped here, but if those kind of numbers persist, could we see volume growth in kind of the mid-single-digit, is that possible for you guys at this stage?

Mike, it's a good question when we obviously are keeping a close eye on. I'll just comment on a few aspects of your question. First of all, we did see rather significant growth in permitting in 2012. We dived into those numbers and you might remember from last quarter we talked about this. Much of that activity was in solar panels and those were high construction dollar amounts, but relatively low in terms of shipment volumes. I think we are encouraged, we are going to be two down about the state of the Hawaiian economy and we continue to hear great news out of the tourism industry for the year, they are expecting a good tourism picture for 2013 and all of that I think boards well into the future. It’s a little tougher to time Mike is, when does construction return? Clearly the tax receipts, GDP, other unemployment that you mentioned are all positives and the question is, when will that turn into meaningful growth since we haven’t seen it, we expected some of that in 2012, they frankly didn’t quite materialize. We just want to be cautious before we see the real beginnings of that. To your element of your question about how high can growth be, yeah, I mean we’ve seen years when construction is peaking at 3% and 4% and 5% annual growth rates have been seen, its just a little too early to call those kinds of changes. Michael Webber – Wells Fargo Securities : Okay. No, no, that’s fair. Just chip for a second here and Joel you talked about margin in your remarks and second quarter in a row, you guys have comment above expectations and it seems like things are certainly firmer this point than they were a year or two ago. And Q1 is typically your weaker seasonal point, but given kind of the way your fleet is configured now with less assets, is it fair to think that kind of 2011 levels from a margin perspective in Q1 are a little bit more of a normal run rate here then say 2011 or 2012 where you guys are touching 2% and 3% in the first quarter. Is kind of a mid single digit number there will be a bit more fair.

Mike, I don’t want to comment on the mid single digit comment at the end you mentioned there, but what’s tricky about the margin – looking our margin overtime is, it is significantly in funds that our fuel was at that time. If we have so much fuel spend that really flows through at a zero margin basis. So what we tend to focus on more at least in the short term or looking at any period to period exact comparison is just operating income in the aggregate, because you really have to - if you study margins, you really have to back out and make assumptions about where fuel was. And make the challenging fuel prices between ‘09 and where we are at today, that fluctuated quite a bit which makes some of those comparisons quite difficult. Michael Webber – Wells Fargo Securities: Gotcha. I’m just kind of talking to a margin number that’s all. So that will make sense. Just a couple more from me and I will turn it over. I guess one – I guess power level question, we think a couple, I don’t feel the competitors, but a couple of alternative players come out and place orders, I like you mentioned the Pasha combo carrier and then codes been out there with a couple LNG-powered assets. Actually two new builds and I believe they are getting the rest of the fleet converted as well. Can you talk a little bit about and I don’t know whether there is something has worked out or not, I would have seen you – since you are looking at replenishing. The kind of incremental – the other fuel savings or some sort of quantifiable margin bump, do you think you could see from an LNG powered asset versus a traditional due to electric or something on those lines? And then may be kind of where you stand on that replenishment program, and may be what’s the last hurdle is I guess for falling the trigger and make these in the process in the CCF.

Sure, yes. Mike, I could take the first crack a bit and then I’ll leave the issues around the CCF to Joel to comment on the balance sheet. So I think you are right, I think we have seen a relatively meaningful investment or reinvestment in fleet assets by other Jones Act participants. Crowley has also invested in SeaRiver, Exxon has also invested in New Jones Act tonnage. So we are seeing relatively healthy reinvestment in the business and we do expect also to hopefully finalize our plan this calendar year. I think it is very, we’re taking a hard look like everyone else at LNG as a fuel source and engine manufacturers are working rapidly to create dual fuel engines and so obviously that will be something we take a very close look at. Economics and the timing is exactly when LNG becomes available as a regular bunker source on the U.S. West Coast when that all happens is still little bit unclear to answer. These assets are going to be long-lived and we want to be able to take advantage of lower fuel costs associated with LNG if and when they do come. So that clearly isn’t our thinking. Michael Webber – Wells Fargo Securities : And then Joel, would you comment on balance sheet and the CCF?

Sure. Mike, on the CCF side, what's important is maybe to walk through the sequencing of how we would approach this in general. Where we are at right now is in the core engineering design of the vessel phase, it is the top priority of our engineering teams and senior management. So as we move along and look at the design of our vessels and look at features and how must they cost, dialogue with shipyards et cetera and figure out what we think within acceptable band of cost it's going to be, we have to move along that whole process to determine the economics and make sure we are comfortable that the economic return is going to be shareholder value enhancing. And as we do – we wouldn't start making deposits in the CCF, and so were had gotten through all of that, look at the economics, convinced ourselves with the rigor of being focused on ROIC and shareholder value that the investment is going to create value and then at that point get board approval and move forward with deposits coming to final contract with the shipyard and having a balance sheet prepared to do that. So when I say we're midstream I’m going to say, it’s been a top priority for quite some time. What we are saying today is that we expect to work through all of that internal work throughout 2013 and have more specifics to share in you and investors as we do that work throughout 2013. So we will give plenty of heads up with respect to how those plans are coming together, the dollars and cents and economics of it and CCF and all of that as we work through things in 2013. Michael Webber – Wells Fargo Securities : Okay. That’s helpful. I’ll turn it over and get back in the queue. Thanks guys.

And the next question is from Kevin Sterling of BB&T Capital Markets. Kevin Sterling – BB&T Capital Markets : Hello, Matt and Joel.

Hi, Kevin.

Hi, Kevin. Kevin Sterling – BB&T Capital Markets: That’s all my Hawaiian for the day. In the China trade, you guys – Matt, you said you expect new capacity to add strip demand. Is this from ships that were anchored that is coming back online or is it new capacity from shipyards. How should we think about that?

Kevin, I think its both. I think if you look at also liner and some of these other industry wide publications that track stats. There is something like between 9% and 10% increase in expected capacity increases during calendar 2013. And in fact 2013 will be – if there are further delays and deliveries using that figure, the largest single year of year-over-year growth in TEU capacity worldwide. Now, that 9% or between 9% and 10% is significantly lower than the expected increase in worldwide demand for containerization. And so it’s not just the transpacific issue, but it’s a global container capacity issue. There is generally higher demand in emerging markets in North, South trades generally flatter demand of course, in Europe is a big question and even in the phase of a slowly recovering U.S. economy, demand growth is expected to be somewhat muted. There is a little factor associated with taking some vessels that were in reserve status and putting them into active use, but it’s primarily the new vessel deliveries that are driving most of that growth. Kevin Sterling – BB&T Capital Markets: Okay. Thank you, Matt for your color. In making the quandary, I think I know you talked about, right now there is no entrance, but are you hearing of any sense of new central entrance into the Guam trade line?

We are not. And we’re always cautious whenever we say we are not, to – one could start relatively quickly, but we are hearing no market charter as of this moment in time. Kevin Sterling – BB&T Capital Markets: Okay. Speaking of Guam you talked about the military deployment keeps getting pushed back to 2015 I think it is early as now. What’s your confidence in redeployment actually happening, and is 2015 the infrastructure build out or actual crude movement?

Yeah. So Kevin since you followed our company for a while, I have boldly predicted the increases for the last eight years that have not come to pass. So my confidence is a little bit low, first of all. What we understand is that there is currently an environmental impact report which needs to be modified before any construction activity can return. I think ultimately, there will be some form of increase in Guam, we do expect some increase what form that takes is unclear, and I think it’s going to be part of Pacific pivot, in emerging China, territorial disputes, other kinds of things which will, we do think require the U.S. military to shift or increase its presence in the region. And Guam will be a beneficiary of that to some extent. Now when and how much continues to be the really difficult one to forecast and as I mentioned our track record in predicting this has not been very good. Kevin Sterling – BB&T Capital Markets: Well I’m right there with you, I just have been following your company a long time, so I understand. Hey Joel the $3.9 million impairment charge in logistics, is that pretax?

Yes that’s the number that will hit the operating income line. Kevin Sterling – BB&T Capital Markets: Okay. Now moving to tax affected amount.

About half of it was non-tax deductible and half of it was. So if you take roughly half of it and take our effective tax rate of 38%, that would get you the math to the after-tax effect. Kevin Sterling – BB&T Capital Markets : Perfect. Thank you. And last question here, this deals with West Coast port strike, I am not thinking you were not negatively impacted by the West Coast port strike, is that because your union contract was little different than maybe the master agreement. And secondly, were you able to pick up any potential new business?

Yeah, you are right. We were not impacted by the labor disruption in Southern California. We had reached agreement separately several years earlier than the rest of the employers who have these office clerical units on board. So we had reached the settlement much earlier and we are not impacted by the stoppage. And to your question about whether or not we got much business, I would say we probably got a very small amount as a few customers just wanted to hedge their bit and gave us just a tiny bit of incremental more cargo. But it was very short lived and we haven’t brought it up, it really wasn’t a needle mover for us. Kevin Sterling – BB&T Capital Markets : Okay. That's all I had. Matt, Joe, thank you so much for your time this evening.

Thanks, Kevin.

Thanks.

(Operator Instructions) And our next question is from Jack Atkins of Stephens. Connor Hustava – Stephens Inc.: Hi guys, this is actually Connor Hustava on for Jack today.

Hi, Connor. Connor Hustava – Stephens Inc.: Just picking up where Kevin left off, I’m curious to know if you saw any rate convergence ahead of the long-term negotiation deadline whether or not that would have been a potential benefit to you all on the East Coast, I'm sorry.

It was – we were keeping an eye on that. There were two ways in which we could benefit. First to fall, most of Matson's cargo is local cargo to the West Coast, so we ourselves don’t carry much cargo, the amount that might have moved was not measurable. Certainly through the SSAT joint venture, we're watching for an uptick of volume associated with customers who might have otherwise diverted to the cargo, but doing our own discussions with our customers what we found was most customers had decided to shift their cargo early as opposed to do in last time diversions and so it was really only a negligible impact through the West Coast associated coming up through that deadline. Connor Hustava – Stephens Inc.: Okay, that's helpful. Second question, just wanted to get a sense for where we are with Hawaii today, I’m wondering if you could give us some color on how many additional containers you always – how many additional containers you think you can ship in Hawaii before you need to add another ship to that way?

Basically Connor, we expect to run our fleet our nine-ship fleet for most of the year as we said earlier we are expecting only modest volume gains. We are probably at the low-to-mid 90% utilization of our fleet. And so based on our expectation of modest volume growth, we expect to stay in nine-ship fleet this year. Again low-to-mid 90s call it mid 90% utilization is our fleet point deployment. So if we do see a more robust growth environment, which of course will be welcomed, we may have to break and turn the ship out, our internal planning doesn't indicate that, but if did happen would be a welcome development. Connor Hustava – Stephens Inc.: Okay. That's helpful. And then lastly, as it pertains to logistics with the increase in cash boding requirements and start to take effect later this year for truck brokers, I am curious to know if you’ve seen any increased opportunities from smaller brokers maybe that can afford or don't want to post that bond to partner with Matson as an agent?

Yeah, in fact we have and you might know Conor that we have an in-house brokerage product and an agent model both, and we have seen an uptick in agency inquiries and becoming a sales agent for Matson. And it's kind of baked into our thinking about kind of resuming to normal margins within the logistic unit part of that is there’s going to be a small factor of as you say modern top brokers not meeting the bonding requirements and coming across as the Matson sales agent in the next year. Connor Hustava – Stephens Inc.: Excellent. Thanks for the time.

You bet.

(Operator Instructions) And we do have a follow-up question from Kevin Sterling of BB&T Capital Market. Kevin Sterling – BB&T Capital Market: Thank you Matt, Joel thanks for let me hop back on. Just one follow-up question. For SSAT it looks like you expect some customer attrition in 2013 how should we think about that level, it's going to be similar what we saw in 2012?

Yeah, so just to clarify we could have made that little fair, the main customer losses occurred mid-year 2012 as the grand alliance vessels moved from the joint ventures terminal or in Seattle TA team to a Tacoma terminal. So it's not new customer losses as we’re expecting, but it's rather than full year effective losses that occurred mid year in 2012. There are no new losses that are expected. Kevin Sterling – BB&T Capital Market: Okay. Gotcha. Thank you so much Matt.

Sure.

(Operator Instructions) I’m showing no further questions, I’ll turn the conference back over to Matt Cox, for any closing remarks.

Okay. Well thank you everybody, we look forward to catching up with you at the first quarter call. Aloha.

The conference is now concluded. Thank you for attending today’s presentation. You may now disconnect.