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DATE

Monday, May 4, 2026 at 4:30 p.m. ET

CALL PARTICIPANTS

  • Chairman and Chief Executive Officer — Matthew J. Cox
  • Executive Vice President and Chief Financial Officer — Joel M. Wine

TAKEAWAYS

  • Consolidated Operating Income -- $61.4 million, down $20.7 million year over year, with Ocean Transportation contributing a $19 million decline and Logistics down $1.7 million.
  • China Service Volume -- Decreased 9.5% year over year in the quarter, primarily from lower general demand and following a move back to traditional Lunar New Year freight cycles.
  • Hawaii Service Container Volume -- Down 5.6% year over year, attributed to weaker general demand and last year’s comp including a competitor's vessel drydocking.
  • Alaska Service Container Volume -- Declined 2% year over year, with lower general demand partly offset by additional sailings.
  • Guam Service Container Volume -- Flat compared to last year, with management signaling expectations for ongoing stability.
  • SSAT Terminal Joint Venture Contribution -- $5 million in the quarter, declining $1.6 million year over year due to lower lift volume; full-year outlook is below the $32.5 million contributed last year.
  • Logistics Operating Income -- $6.8 million, down $1.7 million from last year, with the drop primarily from reduced supply chain management contributions.
  • Interest Income -- $6.1 million, down from $9.4 million year over year.
  • Effective Tax Rate -- 16.6%, below last year’s 21.6%, influenced by a discrete tax benefit and lower pre-tax income making the effect more pronounced.
  • Cash Flow from Operations -- $552.1 million in the trailing twelve months, exceeding maintenance CapEx, dividends, and share repurchases combined by $61.4 million.
  • Share Repurchase Activity -- 400 thousand shares bought in the quarter for $54.4 million; new authorization adds 3 million shares to the program, bringing total shares repurchased since August 2021 to 14.2 million (32.7% of shares outstanding) at cumulative cost of $1.3 billion.
  • Total Debt -- $351.1 million at quarter end, down $10.1 million from year end 2025.
  • Fuel Price Impact -- Management expects "a negative impact from the lag in the recovery of fuel costs" in the second quarter due to fuel price volatility but projects full-year recovery of costs with most occurring in the third quarter.
  • Full-Year Outlook -- Raised guidance to consolidated operating income "modestly exceed the level achieved in 2025," driven by China demand strength post-Lunar New Year and continuation into peak season; Ocean Transportation operating income expected to be approximately $20 million above 2025’s $98.6 million.
  • Capital Structure & Spending -- $100 million in cash, $522 million in the Capital Construction Fund (CCF), with CCF covering "approximately 93% of remaining milestone obligations" for ongoing new vessel construction projects.
  • 2026 CapEx Guidance -- Maintenance CapEx expected at $150 million to $170 million; $400 million set for new vessel construction milestone payments.
  • Dividend & Shareholder Return -- $333.8 million returned to shareholders as dividends and buybacks in the trailing twelve months.
  • Diluted Weighted Shares Outstanding -- Decreased 7.8% year over year, reflecting the impact of share repurchases.

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RISKS

  • Management explicitly cited a "negative impact from the lag in the recovery of fuel costs" in the second quarter as a consequence of recent fuel price volatility driven by geopolitical events.
  • Year-over-year decreases in Ocean Transportation and Logistics operating income were primarily linked to weaker China service volumes and lower supply chain management contributions, respectively.

SUMMARY

Matson, Inc. (MATX 1.57%) raised its full-year consolidated operating income outlook, now anticipating results to "modestly exceed" last year, led by strengthening freight demand in its China service post-Lunar New Year and expected continuation through peak season. Operating income for the second quarter is guided $20 million higher year over year, even as management warns of a short-term earnings headwind from delayed recovery of elevated fuel costs. The company has made significant share repurchases, adding a 3 million share authorization, while maintaining a strong funding position for vessel investments with $522 million in its Capital Construction Fund. Maintenance and new vessel construction CapEx remain firmly guided for the year, and the company forecasts a return to normal seasonality with the second and third quarters outpacing the first and fourth.

  • CFO Joel M. Wine stated that interest income in the quarter was impacted by a discrete tax benefit, resulting in a 16.6% effective tax rate versus 21.6% last year.
  • CEO Matthew J. Cox reported the company expects ships to be "full or nearly full in the second and third quarters" as the traditional peak season builds, with continued momentum from Southeast Asia ports and e-commerce demand.
  • Logistics segment is expected to approach prior-year operating income, with management emphasizing ongoing pricing discipline and customer retention strategies amid a soft freight environment.
  • CFO Joel M. Wine clarified that new vessel CapEx milestone payments will occur as $213 million in the second quarter, $34 million in the third quarter, and $110 million in the fourth quarter.
  • Management indicated ongoing share repurchases form part of a disciplined capital allocation strategy, with no major organic or inorganic growth investments currently targeted.

INDUSTRY GLOSSARY

  • SSAT: A terminal joint venture that handles container stevedoring and terminal operations, contributing operating income based on lift volume at participating ports.
  • CLX and MAX Services: Expedited ocean freight services from China and Southeast Asia to Long Beach, California, known for speed and reliability, serving e-commerce and time-sensitive freight demand.
  • CCF (Capital Construction Fund): A reserve fund used by shipping companies to finance vessel construction and major capital projects while deferring federal income taxes on eligible vessel operating income.

Full Conference Call Transcript

Justin Schoenberg: Thank you. Joining me on the call today are Matthew J. Cox, Chairman and Chief Executive Officer, and Joel M. Wine, Executive Vice President and Chief Financial Officer. Slides from this presentation are available for download at matson.com under the Investors tab. Before we begin, I would like 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, presentation slides, and this conference call.

These risk factors are described in our press release and presentation and are more fully detailed under the caption “Risk Factors” on pages 12 to 23 of Form 10-Ks filed on 02/27/2026, and in our subsequent filings with the SEC. Please also note that the date of this conference call is 05/04/2026, 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. I will now turn the call over to Matthew J. Cox.

Matthew J. Cox: Thanks, Justin, and thanks to those on the call. Starting on slide three, in the first quarter 2026, Ocean Transportation operating income exceeded our expectations primarily due to higher freight demand post-Lunar New Year in our China service. In our domestic trade lanes, we saw lower year-over-year volume in Hawaii and Alaska. In Logistics, operating income was lower year over year primarily due to a lower contribution from supply chain management. To date, the Iran conflict has not impacted our operating performance or service levels; however, it has impacted fuel prices in all our markets.

While we have effective mechanisms to recover the cost of fuel by the end of the year, for the second quarter, we expect a negative impact from the lag in the recovery of fuel costs. I will go into more detail later in the presentation on the effects of fuel prices and our recovery mechanisms. Lastly, we are raising our full-year outlook for consolidated operating income and now expect to modestly exceed the level achieved in 2025. The primary driver behind raising outlook for consolidated operating income is the strengthening of freight demand in our China service post-Lunar New Year that we expect now to continue through peak season.

Joel will go into more detail on the outlook later in the presentation. I will now go through the first quarter performance in our trade lanes, SSAT, and Logistics, so please turn to the next slide. In our Hawaii service, container volume for the first quarter decreased 5.6% year over year primarily due to lower general demand and the drydocking of a competitor’s vessel in the year-ago period. For the full year 2026, we expect volume to be comparable to the level achieved in 2025 reflecting similar economic conditions in Hawaii and stable market share. Please turn to slide five.

According to UHERO’s February economic report, Hawaii’s economy is expected to experience modest growth supported by construction activity, while tourism remains soft and inflationary pressures persist. Construction continues to be a bright spot for the labor market with a high level of public and private building activity, including the rebuilding of Maui. Regarding tourism, the outlook for international visitors remains weak, offsetting modest growth in domestic tourist arrivals. Lastly, inflation remains elevated and may continue to weigh on discretionary spending and overall demand. Moving on to our China service on slide six. Matson, Inc.’s volume in the first quarter 2026 was 9.5% lower year over year primarily due to lower general demand.

As we noted on the fourth quarter earnings call, we expected volume in the first quarter to be lower than the prior year as we return to a more traditional Lunar New Year freight cycle. Please turn to slide seven for additional commentary on current business trends. In the first quarter, we did not see a traditional bump in demand prior to Lunar New Year. Post-holiday, the freight demand exceeded our expectation and was driven by higher demand across several of our key market segments such as e-commerce, e-goods, and garments. We saw continued air-to-ocean freight conversions, and further growth and penetration into Southeast Asia ports. E-commerce from South China continues to be a solid recurring contributor to volume demand.

E-goods volume picked up post-holiday due to strong demand for data center servers and racks and has continued into the second quarter. With respect to air-to-ocean freight conversions, we have benefited from elevated freight costs and reduced air cargo capacity in select markets. In the first quarter 2026, we saw strong volume from our feeder network in North and South Vietnam and Thailand. Our Thailand feeder service, commenced operations in late December 2025, has received positive feedback and has exceeded our expectations to date on volume. Overall, the uptick in freight demand we saw post-Lunar New Year has continued to build in the second quarter as demand strengthens and volumes return to a more traditional seasonal pattern.

With increasing demand, we remain focused on maximizing the yield on every sailing out of Shanghai and our freight rates remain at healthy levels. As a result, we expect second quarter 2026 container volume to be higher compared to the prior-year period, which included a market decline in transpacific demand due to the tariffs imposed in April 2025. As a reminder, our container volume declined 30% last April before recovering in May and June. Encouragingly, conditions are more stable today. For the full year 2026, we expect container volume to be moderately higher than the level achieved in 2025 as we expect the demand strength in the second quarter to continue through peak season. Please turn to the next slide.

In our Guam service, Matson, Inc.’s container volume in the first quarter 2026 was flat year over year. In the near term, we expect Guam’s economy to remain stable. As such, for the full year 2026, we expect container volume to be comparable to the level achieved last year. Please turn to the next slide. In our Alaska service, Matson, Inc.’s container volume in the first quarter 2026 decreased 2% year over year. The decrease was primarily due to lower general demand partially offset by an additional northbound sailing and an additional AAX sailing compared to the year-ago period.

In the near term, we expect continued economic growth in Alaska, supported by a low unemployment rate, job growth, and continued oil and gas exploration and production activity. As such, for full year 2026, we expect container volume to be comparable to the level achieved last year. Please turn to slide 10. In the first quarter, our SSAT terminal joint venture contributed $5 million, representing a year-over-year decrease of $1.6 million. The decrease was primarily due to lower lift volume. For the full year 2026, we expect the contribution from SSAT to be lower than the $32.5 million achieved in full year 2025. Turning now to Logistics on slide 11.

Operating income in the first quarter came in at $6.8 million, or $1.7 million lower than the result in the year-ago period. The decrease was primarily due to lower contribution from supply chain management. For full year 2026, we expect operating income to approach the level achieved in full year 2025. Please turn to the next slide. Before I turn the call over to Joel for a review of our financial performance, I would like to share a few thoughts on the recent volatility in fuel attributed to the Iran conflict.

We expect fuel price volatility to impact our near-term earnings due to a timing lag between when we incur fuel costs and when we can fully recover these costs through our fuel surcharge. These mechanisms are very effective at recovering the cost of fuel over time. Historically, in our maritime business, we have been successful in recouping the cost of fuel within any calendar year, although fluctuations can occur between quarters. In the first quarter of this year, the impact was not material as we experienced escalating fuel prices only during the last few weeks of the quarter.

For the second quarter, we expect a lag in the recovery of fuel costs, but we expect to fully recover our fuel costs by the end of the year with most of that occurring in the third quarter. These expectations regarding the impact of fuel costs and the recoverability of these costs have been factored into our outlook. And with that, I will now turn the call over to my partner, Joel.

Joel M. Wine: Okay. Thanks, Matt. Please turn to slide 13 for a review of our financial results. For the first quarter, consolidated operating income decreased $20.7 million year over year to $61.4 million, with Ocean Transportation decreasing $19 million and Logistics declining $1.7 million. The decrease in Ocean Transportation operating income in the first quarter was primarily due to a lower contribution from our China service. The decrease in Logistics operating income was primarily due to a lower contribution from supply chain management. We had interest income of $6.1 million in the quarter compared to $9.4 million in the same period last year. The effective tax rate in the quarter was 16.6% compared to 21.6% in the year-ago period.

Our tax rate was lower year over year due to a discrete tax item that reduced taxable income. Given the lower income level in the quarter relative to the other quarterly periods in the year, discrete tax items can have a more pronounced impact on our effective tax rate in the quarter. In the first quarter 2026, net income and diluted earnings per share were $56.6 million and $[inaudible], respectively. Diluted weighted shares outstanding decreased 7.8% year over year. Please turn to the next slide. We continue to generate strong cash flows. For the trailing twelve months, we generated cash flow from operations of $552.1 million.

We returned capital in the form of dividends and share repurchases of $333.8 million, and we had maintenance CapEx of $150.9 million. Our cash flow from operations exceeded the aggregate spend on maintenance CapEx, dividends, and share repurchases by $61.4 million. Please turn to slide 15 for a summary of our share repurchase program and balance sheet. During the first quarter, we repurchased approximately 400 thousand shares for a total of $54.4 million. Since we initiated our share repurchase program in August 2021, through March, we have repurchased approximately 14.2 million shares, or 32.7% of our stock, for a total cost of approximately $1.3 billion.

On 04/23/2026, we announced the addition of 3 million shares to our existing share repurchase authorization. As we have said before, share repurchases are an important component of our capital allocation strategy, and this increase allows us to continue to be steady buyers of our shares in the absence of any large organic or inorganic growth investment opportunities. Turning to our debt levels, our total debt at the end of the first quarter was $351.1 million, a reduction of $10.1 million from the end of 2025. With that, let me now turn to slide 16 and walk through our outlook for 2026 at the top of the page.

Based on the outlook trends Matt mentioned earlier, we expect Ocean Transportation operating income to be approximately $20 million higher than the $98.6 million achieved in 2025. We also expect Logistics operating income to approach the $14.4 million achieved in 2025. As such, we expect consolidated operating income in the second quarter to be approximately $20 million higher than the prior year, which includes the negative impact we expect from the lag in the recovery of fuel costs that Matt mentioned earlier. On the bottom half of the slide, we have our expectations for full year 2026. Starting with Ocean Transportation, we now expect year-over-year operating income to modestly exceed the level achieved in the prior year.

The strengthening of freight demand in our China service post-Lunar New Year and our expectation that this demand strength continues through peak season is the primary driver behind our raise in outlook. For Logistics, we expect operating income to approach the level achieved in the prior year. As a result, we now expect consolidated operating income to modestly exceed the level achieved in the prior year. Our full-year outlook includes the expectation that we are able to recover fuel costs by the end of the year with most of the recovery occurring in the third quarter.

We also expect a more normal operating seasonality pattern with consolidated operating income in the second and third quarters being the strongest relative to the first and fourth quarters. In addition to this full-year operating income outlook, we expect the following for the full year: depreciation and amortization to approximate $210 million inclusive of approximately $35 million for drydocking amortization; interest income to be approximately $16 million; interest expense to be approximately $6 million; other income to be approximately $7 million; an effective tax rate of approximately 21%; and drydocking payments of approximately $45 million. Moving to slide 17, the table on the slide shows our CapEx projections for the full year 2026.

Our range for maintenance and other capital expenditures is unchanged at $150 million to $170 million for full year 2026. Our estimate for expected new vessel construction milestone payments and related costs for full year 2026 is $400 million. As of March 31, we had cash and cash equivalents of approximately $100 million and had approximately $522 million in our capital construction fund. Our CCF covers approximately 93% of our remaining milestone payment obligations, and when combined with our balance sheet cash, exceeds our remaining financial obligations. We continue to be in a great funding position on the new build program. Lastly, our targeted build schedule remains unchanged.

In the first quarter, we made a milestone payment of approximately $16 million from the CCF. Looking ahead, we expect to make approximately $213 million of milestone payments in the second quarter. And then in the third and fourth quarters, we expect to make milestone payments of approximately $34 million and $110 million, respectively. With that, let me turn the call back over to Matt for closing remarks.

Matthew J. Cox: Thanks, Joel. Please turn to slide 18 where I will go through some closing thoughts. We continue to navigate a period of geopolitical tension and uncertainty. While we have experienced higher fuel prices, we are confident in our ability to fully recover our increased fuel costs. Our focus remains on what we can control, which is to put our customers first, maintain operational excellence, and uphold our high standard of service. We remain confident in the demand consistency of our businesses because of our focus on serving niche markets where we are an integral part of the supply chain. In our domestic trade lanes, we provide a vital lifeline to the communities we serve.

And in our China service, our value proposition is differentiated based on speed, reliability, and schedule integrity. Building on these strengths, we have successfully moved with our customers into Southeast Asia markets to extend our geographic reach and diversify our origination ports. Our China service has also become an important means for our e-commerce customers to meet the increasing consumer demand in the U.S., and we continue to expect e-commerce to be a long-term driver of growth for our CLX and MAX services. Lastly, we remain disciplined in our return of capital to shareholders. In the absence of sizable growth projects or acquisitions, we expect to continue to return excess cash to shareholders.

As Joel mentioned and we recently announced, we added 3 million shares to our authorization to repurchase stock. We will now open the call for questions. I will turn the call back to the operator.

Operator: Certainly. Our first question for today comes from the line of Jacob Gregory Lacks from Wolfe Research. Your question, please.

Jacob Gregory Lacks: Hey, Matt. Hey, Joel. Thanks for your time. You mentioned that you expect demand strength to continue through peak season. Last year was a little bit unique with the MAX service below 100% utilization during peak. Do you think you can get back toward more full ships this year as we move into the third quarter? And as I look at air freight versus ocean freight, air tends to be a lot more fuel intensive. Are you seeing more shippers look to convert freight to your service the longer this high fuel price environment persists? To the extent we start seeing some jet fuel shortages in Asia, could that accelerate volume growth from some of the non-China geographies?

And lastly, can you give us a sense of how much the fuel lag headwind you are expecting in the second quarter is? I know it is volatile, but any quantitative color would be helpful. As you get into the third quarter, could you even over-recover given the investments you have made in scrubbers and LNG, or is this really a true pass-through?

Matthew J. Cox: Yes, I do, Jake. I think we said at the beginning of the year, and we continue to see it as it is unfolding in front of us, a more traditional cycle in the China trades—meaning a post-Lunar New Year slow build to the second and third quarter with full or nearly full ships as we have traditionally seen. We have vessels that are slightly different sizes, but we expect to be full or nearly full in the second and third quarters as we build into the traditional peak season. We expect it to remain busy until the traditional October pattern into the Lunar New Year.

Overall, we expect to end up above where we did last year, and we are at a point where we feel like we are going to exceed last year’s marks. On the air-to-ocean conversion, you are right. Although we have been mentioning air freight conversion for the last couple of years given this expedited space that we created, there has been a long-term trend with periods where that growth would go up or go down. We think we are entering a period where we are going to see more air freight conversions, some of which will be temporary and some of which will continue to convert.

The longer that energy prices and availability are issues, the more the air freight markets are dislocated, especially in places where they primarily import their jet fuel. While we have not seen significant impacts yet, we are seeing, both from a price standpoint and a potential availability standpoint, a lot of passenger airlines cancel flights or cancel marginally profitable flights. That is happening all over the world, including in the U.S., although that is not our core market. Just a reminder that 50% of air freight flies in the bellies of passenger planes. So we see it as a tailwind rather than a huge catalyst.

Our ships are likely to be in a more traditional peak cycle—nearly full—so I think it will be helpful as a tailwind. Regarding the near-term fuel lag, we are not exactly sure where we will end up given the volatility, and it is not central to our story. We remain highly confident in our ability to recover fuel for the year. The first quarter had very little impact because prices escalated late in the quarter and we consume fuel over longer voyages. We think the impact will primarily be felt in the second quarter, and we are highly confident that we will be able to recover that in the second half of the year.

There is not a margin erosion story. Our second quarter guide is inclusive of the amounts we are contemplating, but we would rather stay away from point-specific items. I will let Joel address the recovery mechanics.

Joel M. Wine: If it is fuel-related items, we will put them in the recovery basket, Jake. For instance, for a scrubber—which we have not done recently, but we did many years ago—that is a fuel-related item that allows us to purchase fuel at lower cost. It is part of the overall equation. So if something is very specific to fuel, then yes, that goes into our overall recovery basket.

Operator: Thank you. Our next question comes from the line of Analyst from Stephens Inc. Your question, please.

Analyst: Hey, thanks for taking the question. You previously disclosed transshipment mix around 20% of CLX and MAX. Was there any change in that figure in the first quarter? And then any regions in particular that made you more optimistic on near-term growth? As a follow-up, on the China service, last year was really volatile with a lot of changes in trade. How would you describe overall hesitancy on China trade as we move through the year among customers? And then on the competitive backdrop within expedited ocean, have you seen any increase in blank sailings or capacity losses as competitors had less confidence on the trade backdrop with China?

Matthew J. Cox: I think the 20% we previously cited—we are in the 20% to 25% range—and we expect to continue to be in that range as we grow both our China origins and our Southeast Asia origins as we look toward filling our ships into the more traditional peak season. We do expect our customers to continue to move some of their manufacturing base out of China, although we continue to believe that China will remain an important element of our story and remain an important part of the world’s productive capability for manufacturing products. Could we go up from the 20% to 25%? Sure, it is possible. Importantly, it allows us to move with our customers as they relocate their plants.

We are a trusted supply chain partner, and they have confidence in us, so we will continue to move as our customers move. On hesitancy, customers are looking at producing their products from an all-in standpoint—including tariffs and transportation charges—to meet their retailing needs. There are a lot of factors, but our view, embedded in our commentary, is that while there will be moments where tariff issues pop up, in our world we think that tariff uncertainties are largely behind us. President Xi and President Trump will be meeting in a few weeks. We are optimistic that we are past the period like last fall where there was significant uncertainty.

Regarding the expedited ocean competitive backdrop, on the broader generic ocean side we are seeing relatively good utilization. There are small roll pools. The ocean carriers are trying to get ocean freight rates up. Many of them have significant increases in fuel and other costs and are seeking to raise rates in part to recover those costs. I would call the broader generic ocean market orderly. For the second-tier expedited carriers, we have not seen dramatic changes in capabilities. We have not seen significant cancellations of sailings. The market for that secondary carrier set—there are three or four of them that vie for that space—has been relatively similar.

Our belief was and continues to be that if we remain the fastest and second fastest—CLX and MAX—we will get the lion’s share of the expedited market, and that continues to be true now.

Operator: Thank you. Our next question comes from the line of Analyst from JPMorgan. Your question, please.

Analyst: Hello everyone. Your second quarter Ocean Transportation operating income guidance is $20 million up year over year. Which services or customer segments are driving this growth, and what are the key risks to achieving it? And if you could share some more color on Hawaii and Alaska demand and economic conditions, especially regarding tourism and construction and energy—and again, what risks do you see for 2026? Lastly, the Logistics segment operating income declined in the first quarter. What specific actions are you taking to drive recovery in the second quarter and beyond, and what is your outlook for the rest of the year?

Joel M. Wine: Thanks. The primary driver to that increase is the continued strength in our China trade post-Lunar New Year that we talked about. Our domestic businesses we expect to hang in there on a relatively similar basis year over year. So the primary uptick is really the China trade and the demand drivers in some of our core segments that Matt talked about earlier—e-commerce, e-goods, garments—returning to a more normal traditional demand in the second quarter compared to last year’s second quarter, which had a lot of tariff impacts on it. The risks would be a dislocation—tariffs reenacted or other shocks to the system.

Absent a shock that would impact consumer demand or direct trade relationships, we expect it to be a relatively orderly, demand-driven second quarter, which is how we expect it to be up year over year. On Hawaii, the bright spot is construction. There has been more construction activity, fairly consistent for a year to a year and a half, and we see that driving some demand in 2026. It has not been enough to really buoy the economy in a meaningful way because tourism has been sluggish. U.S. tourism to Hawaii has been okay, although dollar spend has not dramatically grown.

International tourism remains quite a bit off where it was four to five years ago, which has been the biggest overhang on GDP growth in Hawaii. Overall, it is a sluggish environment. In Alaska, there continues to be significant oil and gas and infrastructure investment around energy. That has been very positive. Our volumes have hung in well. We sometimes have year-over-year differentiation based on competitors’ drydocking and timing of voyages, but overall Alaska continues to be steady with an upward trajectory due to energy investment and more disposable income for residents as a result. On Guam, which is a really important domestic market for us, conditions continue to be steady as well.

Tourism is hanging in okay, but again, international is not fully back; government spending in Guam and the Western Pacific region is helping volumes. For Logistics, our outlook for the rest of the year is that we will be approaching last year’s results. The actions we are taking focus on two pieces. Our Span Alaska business is a little over half of Logistics, and there we are focusing on disciplined pricing and delivery for our customers, providing the best transit times and customer service in that market.

On the brokerage business—where margins have been compressed and under pressure in highway truckload and intermodal—we are focusing on stickier customer relationships, small and medium customers, pricing discipline, and good execution in what is still a generally soft freight environment. On the buy side for truck procurement, we continue to work with our trucking partners to buy capacity at the right price, while maintaining our pricing and margin discipline. We expect to approach last year’s results for the full year.

Operator: Thank you. This does conclude the question-and-answer session of today’s program. I would like to hand the program back to Matthew J. Cox for any further remarks.

Matthew J. Cox: Thanks for listening in today. We look forward to catching up with everyone on our second quarter call. Thanks very much.

Unknown Speaker: Aloha.

Operator: Thank you, ladies and gentlemen, for your participation in today’s conference. This does conclude the program. You may now disconnect. Good day.