On the cost side, we expect to further improve our inland U.S. equipment management by increasing utilization of returning empty containers to an 85% rate, which is really exceptional in this business. And that's a program which Matson Integrated Logistics has successfully implemented during 2007. Lastly, while market conditions in the Transpacific at present don't allow for a profitable startup of a second China string, we will continue to closely monitor developments in that trade.

Shifting to the Hawaii Service, this slide shows several of the keys to our success in 2008. First, we will closely manage our vessel and terminal capacity in order to be as efficient as possible. We plan to make use of a new off-dock facility in Oahu in 2008 to further improve the efficiency of our Sand Island hub. We have just converted one of our largest container ships to a combination roll-on container vessel, which allows us to both provide better service to our auto customers and at a much lower stevedoring cost.

We have also made important investments in the neighbor islands to improve our capabilities there as well, and have recently taken direct control over stevedoring labor in those locations. Managing our costs is paramount and we've listed just a few which we expect will favorably impact our results in 2008. And lastly, we'll focus on a successful implementation of a general rate increase in the Hawaii trade, and closely monitor the volatile fuel costs to ensure that we are recovering this large and uncontrollable cost for operating expenses.

Shifting to Guam, we continue to be encouraged by the developments there. Within the next five years the active duty personnel are expected to more than double and will require a multi-billion dollar upgrade to the infrastructure of that island. We believe that we are still a few years away from that peak activity, where volumes are expected to grow by 15% or more, but rather expect a healthy 4% to 6% volume increase in 2008.

And our priorities in '08 will be to ensure we have adequate infrastructure in place to handle the expected volumes, and in working with the port and government of Guam to ensure that the port is ready as well. At Matson Integrated Logistics we expect healthy increases in volumes in 2008 in the 10% to 12% range. This far exceeds the level of industry growth as we expect to continue to gain market share and could see much larger increases with acquisitions.

While we do expect the competitive landscape to compress margins somewhat in 2008, we see an overall increase in our profit margins because of a higher mix of our highway brokerage business. We continue to believe that our Logistics is scalable, and will be on the prowl for acquisitions of well-run businesses that fill out our geographic mix and our product offerings.

And I would add that this has been an active process during the past year and we have taken several deals through extensive due diligence, but in the end they did not meet our valuation criteria. Lastly, our newly announced Matson Global will be another important platform for growth within Matson Logistics over time, and will give us the ability to leverage both the transportation businesses, as well as our real estate business.

And with that, let me turn this over to Stan Kuriyama to discuss the Properties outlook and operating priorities for 2008. Stan?

Stan Kuriyama - Alexander & Baldwin - President & CEO, Land Group, Vice Chairman & CEO, A&B Properties, Inc.

Thank you, Jim, and aloha, everyone. Despite the headwinds mentioned by Allen, we're expecting a pretty solid year at Properties in 2008. A significant majority of that profit will be derived from our development and property sales activity. The largest contributor to earnings will be our Keola La'i high-rise condominium near downtown Honolulu, where, as Allen mentioned, we expect to close a sale of the entire project in 2008.

Also key to 2008 earnings will be meeting our sales targets at half a dozen other development and joint venture projects, some of which will be described in the next few slides, maintaining the high occupancy in our income portfolio, which currently stands at a very healthy 97%, and executing on our core property sales program of selling a mix of income properties for which we have maximized property values and non-core land sales which, as I mentioned in a prior call, consists of land that is not suitable for urban development and not used for agricultural or public purposes.

We will continue to grow our real estate business by increasing our pipeline of development projects by putting to work an estimated $200 million of capital investment in 2008, and by incrementally expanding our income portfolio through 1031 reinvestments of proceeds from new property sales.

Slide 22 provides the additional sales and capital detail on three of our most significant projects in 2008. As mentioned, our Keola La'i high-rise will be completed in early 2008, requiring a remaining capital expenditure of about $14 million. With 90% of the units under binding contract, we expect to sell all units in '08 generating sales revenue of approximately $220 million.