SECURITIES AND EXCHANGE COMMISSION
Washington, D. C.
FORM U-3A-2
STATEMENT BY HOLDING COMPANY CLAIMING EXEMPTION
UNDER RULE U-2 FROM THE PROVISIONS OF THE PUBLIC
UTILITY HOLDING COMPANY ACT OF 1935
TO BE FILED ANNUALLY PRIOR TO MARCH 1
ALEXANDER & BALDWIN, INC.
(Name of Company)
P. O. Box 3440
Honolulu, Hawaii 96801
(hereinafter called the "Claimant") and its wholly-owned subsidiary, A&B-Hawaii,
Inc., P. O. Box 3440, Honolulu, Hawaii 96801 (hereinafter called "Co-claimant"),
hereby file with the Securities and Exchange Commission, pursuant to Rule U-2,
this joint and consolidated statement claiming exemption as a holding company
from the provisions of the Public Utility Holding Company Act of 1935. This
statement is filed jointly by Claimant and Co-claimant pursuant to oral author
ization to file on a joint and consolidated basis received from the Commission
on February 21, 1990. In support of such claim for exemption the following
information is submitted:
1. The name, jurisdiction of organization, location and nature of
business of Claimant and Co-claimant, and every subsidiary thereof, other than
any exempt wholesale generator (EWG) or foreign utility company in which
Claimant or Co-claimant directly or indirectly hold an interest, as at
January 31, 1995 (indirect subsidiaries are indicated by indentation).
Jurisdiction
Name: of Organization Location Nature of Business
Alexander & Baldwin, Inc. Hawaii Honolulu, Ocean carriage of goods,
Hawaii real property management and
development, investments
Subsidiaries:
A&B-Hawaii, Inc. Hawaii Honolulu, Agriculture/food (includ-
Hawaii ing sugarcane and coffee
plantations), real property manage
ment and development, general
freight and petroleum hauling and
self-storage services
- -A&B Development California Honolulu, Ownership and manage-
Company Hawaii ment of real property in
(California) California
- -A&B Inc. Hawaii Honolulu, Inactive
Hawaii
- -A&B Properties, Hawaii Kahului, Ownership, management,
Inc. Hawaii development and selling of real
property
- -California and Hawaii Crockett, Refining raw sugar and
Hawaiian Sugar California marketing of refined
Company, Inc. sugar products and
molasses
- --MLM Corporation California Crockett, Marketing of refined
California sugar products
- -East Maui Irrigation Hawaii Puunene, Collection and distribution
Company, Limited Hawaii of irrigation water on
island of Maui
- -Kahului Trucking & Hawaii Kahului, Motor carriage of goods,
Storage, Inc. Hawaii self-storage services and stevedor
ing on island of Maui
- -Kauai Commercial Hawaii Lihue, Motor carriage of goods
Company, Hawaii and self-storage services
Incorporated on island of Kauai
- -Kukui'ula Hawaii Koloa, Ownership, management
Development Hawaii and development of real
Company, Inc. estate on the island of Kauai
- -McBryde Sugar Hawaii Eleele, Sugar cane plantation
Company, Limited Hawaii
- --Island Coffee Hawaii Eleele, Grow, process and sell
Company, Inc. Hawaii coffee
- -Ohanui Corporation Hawaii Puunene, Collection and distribution
Hawaii of domestic water on island of Maui
- -South Shore Hawaii Koloa, Development and
Community Hawaii operation of sewer trans-
Services, Inc. mission and treatment system on
island of Kauai
- -South Shore Hawaii Koloa, Development and
Resources, Inc. Hawaii operation of water
source and delivery system on
island of Kauai
- -WDCI, INC. Hawaii Honolulu, Ownership, manage-
Hawaii ment and development of property
- -Hawaiian Sugar Hawaii Crockett, Carriage of sugar from
and Transportation California Hawaii
Cooperative
Matson Navigation Hawaii San Ocean carriage of goods
Company, Inc. Francisco, between West Coast of
California United States and Hawaii and
Western Pacific ports
- -Matson Intermodal Hawaii San Broker, shipper's agent
System, Inc. Francisco, and freight forwarder for
California overland cargo services of ocean
carriers
- -Matson Leasing Hawaii San Container leasing
Company, Inc. Francisco,
California
- --Pacific Hawaii San Container leasing
International Francisco,
Container California
Corporation
- ---Matson Australia Sydney, Container leasing
Leasing Australia
Company
Pty Limited
- --Matson Leasing Germany Bremen, Container leasing
Company GmbH Germany
- --Matson Leasing Hong Kong Hong Kong Container leasing
Company (HK)
Limited
- --Matson Leasing United Kingdom London Container leasing
Company England
Limited
- --Matson Leasing Singapore Singapore Container leasing
Company
(Singapore)
Pte Ltd
- --Matson Leasing France Paris, Container leasing
Company France
S.A.R.L.
- --Matson Leasing France Paris, Container leasing
Company France
(Europe) S.A.R.L.
- --Matson Leasing Brazil Rio de Container leasing
Company Janeiro,
Servicos Ltda. Brazil
- -Matson Services Hawaii San Tugboat services
Company, Inc. Francisco,
California
- -Matson Terminals, Hawaii San Stevedoring and terminal
Inc. Francisco, services
California
- -The Matson California San Inactive
Company Francisco,
California
- -The Oceanic California San Inactive
Steamship Francisco,
Company California
2. A brief description of the properties of Claimant and Co-claimant,
and each of their subsidiary public utility companies, used for the generation,
transmission and distribution of electric energy for sale, or for the
production, transmission and distribution of natural or manufactured gas:
Claimant: None
Co-Claimant: 4 steam-driven generators with rated capacities of 1
of 12,000 KW, 2 of 10,000 KW, and 1 of 20,000 KW; 5
hydroelectric plants with rated capacities of 1 of
1,000 KW, 3 of 1,500 KW and 1 of 500 KW; about 80
miles of transmission lines; all located on the
island of Maui, State of Hawaii
McBryde Sugar Company, 2 steam-driven generators with rated capacities of
Limited ("McBryde") 7,500 KW; 2 hydroelectric plants with rated
(Note 1) capacities of 1 of 1,000 KW and 1 of 3,600 KW; about
70 miles of transmission lines; all located on the
island of Kauai, State of Hawaii
3. Information for the calendar year 1994 with respect to Claimant and
Co-claimant, and each of their subsidiary public utility companies:
(a)(1) Number of kwh of electric energy sold (all sales were at
wholesale):
Claimant None
Co-claimant 101,994,000 kwh
McBryde 20,381,000 kwh
(2) Number of Mcf of natural or manufactured gas distributed at
retail:
None. Neither Claimant nor Co-claimant, nor any of their
subsidiary public utility companies, distributes any natural or manufactured gas
at retail.
(b) Number of kwh of electric energy and Mcf of natural or
manufactured gas distributed at retail outside the State in which each such
company is organized:
None. Neither Claimant nor Co-claimant, nor any of their
subsidiary public utility companies, distributes any electric energy or natural
or manufactured gas at retail outside the State in which each such company is
organized.
_______________
Note 1. McBryde Sugar Company, Limited has filed with the Securities and
Exchange Commission an application for an order declaring that it is
not an electric utility company.
- ---------------
(c) Number of kwh of electric energy and Mcf of natural or
manufactured gas sold at wholesale outside the State in which each such company
is organized, or at the State line:
None. Neither Claimant nor Co-claimant, nor any of their
subsidiary public utility companies, sells electric energy or natural or
manufactured gas at wholesale (or otherwise) outside the State in which each
such company is organized, or at the State line.
(d) Number of kwh of electric energy and Mcf of natural or
manufactured gas purchased outside the State in which each such company is
organized, or at the State line:
None. Neither Claimant nor Co-claimant, nor any of their
subsidiary public utility companies, purchases any electric energy or natural or
manufactured gas outside the State in which each such company is organized, or
at the State line.
4. The following information for the reporting period with respect to
Claimant and Co-claimant and each interest they hold directly or indirectly in
an EWG or a foreign utility company, stating monetary amounts in United States
dollars:
(a) Name, location, business address and description of the
facilities used by the EWG or foreign utility company for the generation,
transmission and distribution of electric energy for sale or for the
distribution at retail of natural or manufactured gas.
Not applicable. Neither Claimant nor Co-claimant holds any
interest, directly or indirectly, in an EWG or a foreign utility company.
(b) Name of each system company that holds an interest in such EWG
or foreign utility company; and description of the interest held.
No applicable (see 4(a) above).
(c) Type and amount of capital invested, directly or indirectly, by
the holding company claiming exemption; any direct or indirect guarantee of the
security of the EWG or foreign utility company by the holding company claiming
exemption; and any debt or other financial obligation for which there is
recourse, directly or indirectly, to the holding company claiming exemption or
another system company, other than the EWG or foreign utility company.
Not applicable (see 4(a) above).
(d) Capitalization and earnings of the EWG or foreign utility
company during the reporting period.
Not applicable (see 4(a) above).
(e) Identify any service, sales or construction contract(s) between
the EWG or foreign utility company and a system company, and describe the
services to be rendered or goods sold and fees or revenues under such
agreement(s).
Not applicable (see 4(a) above).
EXHIBIT A
Consolidating statements of income and retained earnings of Claimant and
Co-claimant, and their subsidiary companies, for the last calendar year,
together with a consolidating balance sheet of Claimant and Co-claimant, and
their subsidiary companies, as of the close of such calendar year, are attached
hereto.
EXHIBIT B
FINANCIAL DATA SCHEDULE
If, at the time a report on this form is filed, the registrant if
required to submit this report and any amendments thereto electronically via
EDGAR, the registrant shall furnish a Financial Data Schedule. The Schedule
shall set forth the financial and other data specified below that are applicable
to the registrant on a consolidated basis, and is attached hereto.
ITEM NO. CAPTION HEADING
1 Total Assets
2 Total Operating Revenues
3 Net Income
EXHIBIT C
An organizational chart showing the relationship of each EWG or foreign
utility company to associate companies in the holding-company system.
Not applicable. Neither Claimant nor Co-claimant holds any interest,
directly or indirectly, in an EWG or a foreign utility company.
The above-named Claimant and Co-claimant have caused this joint and
consolidated statement to be duly executed on their behalf by their authorized
officers this 24th day of February, 1995.
ALEXANDER & BALDWIN, INC. A&B-HAWAII, INC.
(Name of Claimant) (Name of Co-Claimant)
By: /s/ Glenn R. Rogers By: /s/ G. Stephen Holaday
Glenn R. Rogers G. Stephen Holaday
Vice President Senior Vice President
(Corporate Seal) (Corporate Seal)
Attest: Attest:
/s/ Alyson J. Nakamura /s/ Alyson J. Nakamura
Asst. Secretary Secretary
Name, title and address of Officer to whom notices and correspondence
concerning this statement should be addressed:
If to Claimant
Alexander & Baldwin Inc.: Michael J. Marks
Vice President, General Counsel and Secretary
Alexander & Baldwin, Inc.
P. O. Box 3440
Honolulu, Hawaii 96801
If to Co-claimant
A&B-Hawaii, Inc.: Michael J. Marks
Senior Vice President and General Counsel
A&B-Hawaii, Inc.
P. O. Box 3440
Honolulu, Hawaii 96801
EXHIBIT A
ALEXANDER & BALDWIN, INC.
CONSOLIDATING STATEMENT OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 1994
($000 omitted)
ABIC Elim ABI MNC ABHIC
OPERATING REVENUES:
Net sales 72,100 0 1,473 0 70,627
Net sugar sales 414,836 0 0 0 414,836
Transportation and terminal svc 536,510 0 0 530,218 6,292
Rentals and other services 161,764 0 6,902 125,152 29,710
Equity in earnings of affiliates 0 0 0 0 0
Total operating revenues 1,185,210 0 8,375 655,370 521,465
OPERATING COSTS AND EXPENSES:
Cost of goods sold 51,580 0 1,210 0 50,370
Cost of sugar sold 370,864 0 0 0 370,864
Cost of services 517,322 12,961 2,384 464,355 37,622
Total operating costs and exp 939,766 12,961 3,594 464,355 458,856
GROSS MARGIN 245,444 (12,961) 4,781 191,015 62,609
GENERAL, ADMIN & SELLING EXPENSES 120,238 0 11,119 73,863 35,256
INCOME (LOSS) FROM OPERATIONS 125,206 (12,961) (6,338) 117,152 27,353
OTHER INCOME:
Interest - marketable securities 0 0 0 0 0
Interest - ccf 0 0 0 0 0
Interest - other invest 0 0 0 0 0
Interest - other 11,678 0 23 11,172 483
Total interest 11,678 0 23 11,172 483
Interest - intercompany 0 (232) (177) 0 409
Total interest 11,678 (232) (154) 11,172 892
Dividends 2,791 0 2,791 0 0
Gain on disposal of property 1,305 0 1,047 258 0
Gain of sale of securities 0 0 0 0 0
Other 7,181 0 69 2,086 5,026
Total securities and other 7,181 0 69 2,086 5,026
Total other income 22,955 (232) 3,753 13,516 5,918
OTHER DEDUCTIONS:
Interest - long-term debt 0 0 0 0 0
Interest - capital leases 0 0 0 0 0
Interest capitalized (3,725) 0 0 0 (3,725)
Interest - other 31,427 (12,961) 915 25,431 18,042
Total interest 27,702 (12,961) 915 25,431 14,317
Interest - intercompany . 0 (232) 10 0 222
Total interest 27,702 (13,193) 925 25,431 14,539
Share of joint venture loss 0 0 0 0 0
Other 7,224 0 223 3,784 3,217
Total other deductions 34,926 (13,193) 1,148 29,215 17,756
INCOME BEFORE TAXES 113,235 0 (3,733) 101,453 15,515
INCOME TAXES:
Current - Federal 15,189 (27) (3,303) 17,023 1,496
Current - State 260 397 (379) 2,060 (1,818)
Deferred income taxes 23,178 (370) (657) 19,633 4,572
Total provision 38,627 0 (4,339) 38,716 4,250
INCOME BEFORE DEFERRED TAX ADJ. 74,608 0 606 62,737 11,265
DEFERRED INCOME TAX ADJUSTMENT 0 0 0 0 0
NET INCOME 74,608 0 606 62,737 11,265
A&B - HAWAII, INC.
CONSOLIDATING STATEMENT OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 1994
($000 omitted)
ABHIC Elim ABHI ABP ABD
OPERATING REVENUES:
Net sales 70,627 (2,350) 14,695 35,269 514
Net sugar sales 414,836 (83,794) 86,703 0 0
Transportation and terminal svc 6,292 0 0 0 0
Rentals and other services 29,710 (4,712) 782 17,360 70
Equity in earnings of affiliates 0 0 0 0 0
Total operating revenues 521,465 (90,856) 102,180 52,629 584
OPERATING COSTS AND EXPENSES:
Cost of goods sold 50,370 (6,819) 7,882 28,772 190
Cost of sugar sold 370,864 (83,794) 83,811 0 0
Cost of services 37,622 (4,082) 376 5,546 14
Total operating costs and exp 458,856 (94,695) 92,069 34,318 204
GROSS MARGIN 62,609 3,839 10,111 18,311 380
GENERAL, ADMIN & SELLING EXPENSES 35,256 (630) 6,281 3,886 0
SELLING EXPENSES 0 0 0 0 0
INCOME (LOSS) FROM OPERATIONS 27,353 4,469 3,830 14,425 380
OTHER INCOME:
Interest - marketable securities 0 0 0 0 0
Interest - ccf 0 0 0 0 0
Interest - other invest 0 0 0 0 0
Interest - other 483 0 136 334 0
Total interest 483 0 136 334 0
Interest - intercompany 409 (13,991) 7,376 6,853 0
Total interest 892 (13,991) 7,512 7,187 0
Dividends 0 0 0 0 0
Gain on disposal of property 0 0 0 0 0
Gain of sale of securities 0 0 0 0 0
Other 5,026 (5,000) 5,165 886 0
Total securities and other 5,026 (5,000) 5,165 886 0
Total other income 5,918 (18,991) 12,677 8,073 0
OTHER DEDUCTIONS:
Interest - long-term debt 0 0 0 0 0
Interest - capital leases 0 0 0 0 0
Interest capitalized (3,725) 0 0 (714) 0
Interest - other 18,042 0 11,933 0 0
Total interest 14,317 0 11,933 (714) 0
Interest - intercompany 222 (13,991) 8,846 714 0
Total interest 14,539 (13,991) 20,779 0 0
Share of joint venture loss 0 0 0 0 0
Other 3,217 0 536 0 0
Total other deductions 17,756 (13,991) 21,315 0 0
INCOME BEFORE TAXES 15,515 (531) (4,808) 22,498 380
INCOME TAXES:
Current - Federal 1,496 2,574 2,135 6,181 128
Current - State (1,818) (54) (531) 150 68
Deferred income taxes 4,572 (1,757) (3,856) 1,548 (2)
Total provision 4,250 763 (2,252) 7,879 194
INCOME BEFORE DEFERRED TAX ADJ. 11,265 (1,294) (2,556) 14,619 186
DEFERRED INCOME TAX ADJUSTMENT 0 0 0 0 0
NET INCOME 11,265 (1,294) (2,556) 14,619 186
A&B - HAWAII, INC.
CONSOLIDATING STATEMENT OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 1994
($000 omitted)
WDCI KDC SSR SSC C&H MCB
OPERATING REVENUES:
Net sales 19,278 0 0 0 1,299
Net sugar sales 0 0 0 0 405,194 6,733
Transportation and terminal svc 0 0 0 0
Rentals and other services 12,852 0 0 13
Equity in earnings of affiliates 0 0 0 0
Total operating revenues 32,130 0 0 13 405,194 8,032
OPERATING COSTS AND EXPENSES:
Cost of goods sold 15,523 0 0 0 418
Cost of sugar sold 0 0 0 0 362,299 8,548
Cost of services 4,826 0 0 13 23,656
Total operating costs and exp 20,349 0 0 13 385,955 8,966
GROSS MARGIN 11,781 0 0 0 19,239 (934)
GENERAL, ADMIN & SELLING EXPENSES 110 72 0 0 24,471
SELLING EXPENSES 0 0 0 0
INCOME (LOSS) FROM OPERATIONS 11,671 (72) 0 0 (5,232) (934)
OTHER INCOME:
Interest - marketable securities 0 0 0 0
Interest - ccf 0 0 0 0
Interest - other invest 0 0 0 0
Interest - other 9 0 0 0
Total interest 9 0 0 0 0 0
Interest - intercompany (3) 0 0 0
Total interest 6 0 0 0 0 0
Dividends 0 0 0 0
Gain on disposal of property 0 0 0 0
Gain of sale of securities 0 0 0 0
Other 22 0 0 0 618 3,097
Total securities and other 22 0 0 0 618 3,097
Total other income 28 0 0 0 618 3,097
OTHER DEDUCTIONS:
Interest - long-term debt 0 0 0 0
Interest - capital leases 0 0 0 0
Interest capitalized 0 (1,980) (54) (977)
Interest - other 0 0 0 0 6,109
Total interest 0 (1,980) (54) (977) 6,109 0
Interest - intercompany 0 1,980 54 977 402 965
Total interest 0 0 0 0 6,511 965
Share of joint venture loss 0 0 0 0 0 0
Other 0 0 0 0 2,316 131
Total other deductions 0 0 0 0 8,827 1,096
INCOME BEFORE TAXES 11,699 (72) 0 0 (13,441) 1,067
INCOME TAXES:
Current - Federal 2,557 (25) (19) (1,118) (8,279) (1,250)
Current - State 148 (3) (1) (72) (1,356) (108)
Deferred income taxes 927 1 20 635 4,382 1,739
Total provision 3,632 (27) 0 (555) (5,253) 381
INCOME BEFORE DEFERRED TAX ADJ. 8,067 (45) 0 555 (8,188) 686
DEFERRED INCOME TAX ADJUSTMENT 0 0 0 0
NET INCOME 8,067 (45) 0 555 (8,188) 686
A&B - HAWAII, INC.
CONSOLIDATING STATEMENT OF INCOME
FOR THE YEAR ENDED DECEMBER 31, 1994
($000 omitted)
MCBF KCC KTS OC EMI
OPERATING REVENUES:
Net sales 970 952
Net sugar sales
Transportation and terminal svc 2,900 3,392
Rentals and other services 297 3,048
Equity in earnings of affiliates
Total operating revenues 970 3,197 6,440 0 952
OPERATING COSTS AND EXPENSES:
Cost of goods sold 3,452 952
Cost of sugar sold
Cost of services 2,713 4,560
Total operating costs and exp 3,452 2,713 4,560 0 952
GROSS MARGIN (2,482) 484 1,880 0 0
GENERAL, ADMIN & SELLING EXPENSES 534 532
INCOME (LOSS) FROM OPERATIONS (2,482) (50) 1,348 0 0
OTHER INCOME:
Interest - marketable securities
Interest - ccf
Interest - other invest
Interest - other 4
Total interest 4 0 0
Interest - intercompany 32 142
Total interest 0 32 146 0 0
Dividends
Gain on disposal of property
Gain of sale of securities
Other 4 234
Total securities and other 0 0 0 4 234
Total other income 0 32 146 4 234
OTHER DEDUCTIONS:
Interest - long-term debt
Interest - capital leases
Interest capitalized
Interest - other
Total interest 0 0 0
Interest - intercompany 275 0
Total interest 275 0 0 0 0
Share of joint venture loss 0 0 0
Other 4 230
Total other deductions 275 0 0 4 230
INCOME BEFORE TAXES (2,757) (18) 1,494 0 4
INCOME TAXES:
Current - Federal (1,806) (5) 420 3
Current - State (94) (1) 37 (1)
Deferred income taxes 849 (1) 88 (1)
Total provision (1,051) (7) 545 0 1
INCOME BEFORE DEFERRED TAX ADJ. (1,706) (11) 949 0 3
DEFERRED INCOME TAX ADJUSTMENT
NET INCOME (1,706) (11) 949 0 3
ALEXANDER & BALDWIN, INC.
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 1994
($000 omitted)
ABIC Elim ABI MNC ABHIC
CURRENT ASSETS:
Cash 1,057 37 (1,239) 2,259
Certificates of deposit 0 0 0 0
Short-term investments 8,500 0 8,500 0
Accounts and notes receivable: 0 0 0
Trade 120,027 (154) 96,364 23,817
Sugar receivable 4,023 0 0 4,023
Other 18,908 1 15,480 3,427
0 0 0
Undistributed return from sugar 52,648 0 0 52,648
Production costs deferred 0 0 0 0
Property held for Resale 4,014 0 0 4,014
Saleable inventories 1,754 0 0 1,754
Materials and supplies 36,275 0 11,858 24,417
Deferred income tax 15,366 5,879 0 0 9,487
Prepaid expenses 13,180 1,325 937 7,444 3,474
Other current assets 1,345 1,345 0 0 0
Accrued for deposit in CCF (550) 0 (550) 0
Total current assets 276,547 8,549 821 137,857 129,320
INVESTMENTS: Subsidiaries 0 (596,070) 596,070 0 0
Divisions 0 (54,374) 54,374 0 0
Other 64,913 61,031 0 3,882
REAL ESTATE DEVELOPMENTS 66,371 8,196 0 58,175
PROPERTY:
Land 52,202 14,145 38,057
Buildings 190,852 51,622 0 139,230
Vessels 651,435 0 651,435 0
Machinery and equipment 1,024,398 11,655 735,369 277,374
Water, power and sewer system 86,254 1,521 0 84,733
Other property improvements 88,688 1,871 51,264 35,553
Total 2,093,829 0 80,814 1,438,068 574,947
Less accumulated depreciation 812,283 7,595 585,567 219,121
Property - net 1,281,546 0 73,219 852,501 355,826
CAPITAL CONSTRUCTION FUND 176,044 0 176,044 0
NONCURRENT INTERCO RECEIVABLES 0 (54,162) (346) 54,508
DEFERRED CHARGES AND OTHER ASSETS 67,367 1,230 2,194 63,943
TOTAL 1,932,788 (641,895) 740,779 1,168,250 665,654
A&B - HAWAII, INC.
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 1994
($000 omitted)
ABHIC Elim ABHI ABP ABD
CURRENT ASSETS:
Cash 2,259 (623) 2,131
Certificates of deposit 0 0
Short-term investments 0 0
Accounts and notes receivable: 0
Trade 23,817 (4,311) 1,382 473
Sugar receivable 4,023 14,695 (10,099)
Other 3,427 759 1,661 236
0
Undistributed return from sugar 52,648 (14,695) 13,453
Production costs deferred 0
Property held for Resale 4,014 921 3,093
Saleable inventories 1,754 0
Materials and supplies 24,417 6,798
Deferred income tax 9,487 9,487 0
Prepaid expenses 3,474 (1,325) 3,683 (484) 1
Other current assets 0 0
Accrued for deposit in CCF 0 0
Total current assets 129,320 5,531 16,255 5,449 1
INVESTMENTS: Subsidiaries 0 (320,913) 312,243
Divisions 0 (97,382) 97,382
Other 3,882 (6,866) 51 3,824
REAL ESTATE DEVELOPMENTS 58,175 19,586 508
PROPERTY:
Land 38,057 (1,062) 8,775 7,700 413
Buildings 139,230 (5,025) 9,694 28,053 5
Vessels 0 0
Machinery and equipment 277,374 132,636 1,743
Water, power and sewer system 84,733 65,412 2,852
Other property improvements 35,553 (24,421) 3,041 26,710 666
Total 574,947 (30,508) 219,558 67,058 1,084
Less accumulated depreciation 219,121 133,342 16,122 7
Property - net 355,826 (30,508) 86,216 50,936 1,077
CAPITAL CONSTRUCTION FUND 0 0
NONCURRENT INTERCO RECEIVABLES 54,508 3,552 (5,713) 51,009 17,288
DEFERRED CHARGES AND OTHER ASSETS 63,943 1,677 1,768 212
TOTAL 665,654 (425,323) 508,202 111,938 18,366
A&B - HAWAII, INC.
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 1994
($000 omitted)
WDCI KDC SSR SSC C&H MCB
CURRENT ASSETS:
Cash 184 (60) (11) 1,104 (313)
Certificates of deposit 0
Short-term investments 0
Accounts and notes receivable: 0
Trade 69 24,913 918
Sugar receivable 0 (573)
Other 204 11 1 0 21
0
Undistributed return from sugar 52,648 1,242
Production costs deferred 0
Property held for Resale 0
Saleable inventories 0
Materials and supplies 15,129 1,685
Deferred income tax 0
Prepaid expenses 315 17 15 863 199
Other current assets 0
Accrued for deposit in CCF 0
Total current assets 772 (32) 0 5 94,657 3,179
INVESTMENTS: Subsidiaries 0 8,670
Divisions 0
Other 0 7
REAL ESTATE DEVELOPMENTS 32,561 640 4,880 0
PROPERTY:
Land 18,405 1,541 2,005
Buildings 71,045 26,769 3,209
Vessels 0
Machinery and equipment 14 151 112,073 21,058
Water, power and sewer system 0 12,392
Other property improvements 1,298 5,708 172 237 10,582 2,113
Total 90,762 5,859 172 237 150,965 40,777
Less accumulated depreciation 11,063 74 15,067 31,094
Property - net 79,699 5,785 172 237 135,898 9,683
CAPITAL CONSTRUCTION FUND 0
NONCURRENT INTERCO RECEIVABLES 25,723 (23,658) (311) (356) (4,350) (7,006)
DEFERRED CHARGES AND OTHER ASSETS 18,621 41,449 5
TOTAL 124,815 14,656 501 4,766 267,654 14,538
A&B - HAWAII, INC.
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 1994
($000 omitted)
MCBF KCC KTS OC EMI
CURRENT ASSETS:
Cash (116) (37)
Certificates of deposit 0 0
Short-term investments 0 0
Accounts and notes receivable: 0 0
Trade 255 118
Sugar receivable 0 0
Other 577 75 (118)
0 0
Undistributed return from sugar 0 0
Production costs deferred 0 0
Property held for Resale 0 0
Saleable inventories 1,754 0 0
Materials and supplies 381 55 369
Deferred income tax 0 0
Prepaid expenses 61 105 24
Other current assets 0 0
Accrued for deposit in CCF 0 0
Total current assets 2,712 330 437 0 24
INVESTMENTS: Subsidiaries 0 0
Divisions 0 0
Other 6,866 0 0
REAL ESTATE DEVELOPMENTS 0 0
PROPERTY:
Land 0 0 280
Buildings 159 1,664 3,613 44
Vessels 0 0
Machinery and equipment 4,207 1,494 3,283 715
Water, power and sewer system 0 165 7 3,905
Other property improvements 9,099 16 332
Total 13,465 3,174 7,393 7 4,944
Less accumulated depreciation 969 1,579 5,401 7 4,396
Property - net 12,496 1,595 1,992 0 548
CAPITAL CONSTRUCTION FUND 0 0
NONCURRENT INTERCO RECEIVABLES (7,209) 723 2,634 2 2,180
DEFERRED CHARGES AND OTHER ASSETS 51 0 0 160
TOTAL 14,916 2,648 5,063 2 2,912
ALEXANDER & BALDWIN, INC.
CONSOLIDATING BALANCE SHEET, CONTINUED
DECEMBER 31, 1994
($000 omitted)
ABIC Elim ABI MNC ABHIC
CURRENT LIABILITIES:
Notes payable 58,000 0 0 58,000
Current portion long-term debt 27,239 0 6,658 12,509 8,072
Current portion capital leases 7,938 0 0 7,438 500
Accounts payable 36,545 (3) 389 24,291 11,868
Payrolls and vacation pay 19,847 0 624 12,039 7,184
Income taxes - current 0 1,458 (4,976) 2,227 1,291
Income taxes - deferred 0 5,783 198 (5,981) 0
Other taxes 5,390 0 472 3,699 1,219
Postretirement benefits 6,582 0 4 1,284 5,294
Uninsured claims 12,110 0 0 9,408 2,702
Reserve for drydocking 1,158 0 0 1,158 0
Other liabilities 30,022 2 2,328 11,455 16,237
Total current liabilities 204,831 7,240 5,697 79,527 112,367
LONG-TERM LIABILITIES:
Long-term debt 526,231 0 1,084 336,427 188,720
Long-term interco notes payable 0 0 0 0 0
Capital lease obligations 35,274 0 0 31,774 3,500
Postretirement benefits 116,610 1 37 25,778 90,794
Other 67,267 (1) 6,364 33,716 27,188
Total long-term liabilities 745,382 0 7,485 427,695 310,202
DEFERRED CREDITS:
Deferred income taxes 349,961 (17) 40,610 257,996 51,372
Deferred income 0 0 0 0
Total deferred credits 349,961 (17) 40,610 257,996 51,372
Total liabilities 1,300,174 7,223 53,792 765,218 473,941
SHAREHOLDERS' EQUITY:
Capital stock 37,493 (2) 37,493 1 1
Additional capital 38,862 (149,381) 38,862 21,836 127,545
Unrealized holding gains 29,073 0 29,073 0 0
Retained earnings 541,910 (445,362) 541,910 381,195 64,167
Treasury stock (14,724) (14,724) 0 0
Division investment 0 (54,373) 54,373 0 0
Total shareholders' equity 632,614 (649,118) 686,987 403,032 191,713
TOTAL 1,932,788 (641,895) 740,779 1,168,250 665,654
A&B - HAWAII, INC.
CONSOLIDATING BALANCE SHEET, CONTINUED
DECEMBER 31, 1994
($000 omitted)
ABHIC Elim ABHI ABP ABD
CURRENT LIABILITIES:
Notes payable 58,000 0
Current portion long-term debt 8,072 5,410
Current portion capital leases 500 0
Accounts payable 11,868 (23) 2,680 3,109
Payrolls and vacation pay 7,184 2,243 243
Income taxes - current 1,291 3,319 (1,237) (368) 179
Income taxes - deferred 0 7,168 84 16 2
Other taxes 1,219 80 60
Postretirement benefits 5,294 1,245 36
Uninsured claims 2,702 0
Reserve for drydocking 0 0
Other liabilities 16,237 (145) 6,856 1,096
Total current liabilities 112,367 10,319 17,361 4,192 181
LONG-TERM LIABILITIES:
Long-term debt 188,720 154,701
Long-term interco notes payable 0
Capital lease obligations 3,500 0
Postretirement benefits 90,794 (110) 25,250 533
Other 27,188 110 2,195
Total long-term liabilities 310,202 0 182,146 533 0
DEFERRED CREDITS:
Deferred income taxes 51,372 (3,406) 14,204 8,595 71
Deferred income 0 0
Total deferred credits 51,372 (3,406) 14,204 8,595 71
Total liabilities 473,941 6,913 213,711 13,320 252
SHAREHOLDERS' EQUITY:
Capital stock 1 (40,329) 1 452 1
Additional capital 127,545 (192,279) 127,545 34,658 11,519
Unrealized holding gains 0
Retained earnings 64,167 (98,345) 68,710 63,508 6,594
Treasury stock 0 83 0
Division investment 0 (101,366) 98,235
Total shareholders' equity 191,713 (432,236) 294,491 98,618 18,114
TOTAL 665,654 (425,323) 508,202 111,938 18,366
A&B - HAWAII, INC.
CONSOLIDATING BALANCE SHEET, CONTINUED
DECEMBER 31, 1994
($000 omitted)
WDCI KDC SSR SSC C&H MCB
CURRENT LIABILITIES:
Notes payable 58,000
Current portion long-term debt 2,662
Current portion capital leases 500
Accounts payable 86 316 4,917 562
Payrolls and vacation pay 58 3,941 467
Income taxes - current 642 (6) (786) (225) (339) 2,265
Income taxes - deferred (49) (1) (6,045) (879)
Other taxes 1 1 1,050 7
Postretirement benefits 5 3,240 552
Uninsured claims 2,702
Reserve for drydocking 0
Other liabilities 126 40 8,029 184
Total current liabilities 806 414 (787) (225) 78,657 3,158
LONG-TERM LIABILITIES:
Long-term debt 34,019
Long-term interco notes payable 0
Capital lease obligations 3,500
Postretirement benefits 52,703 9,304
Other 25,985 (725)
Total long-term liabilities 0 0 116,207 8,579
DEFERRED CREDITS:
Deferred income taxes 30,626 (1,213) 787 435 (70) (626)
Deferred income 0
Total deferred credits 30,626 (1,213) 787 435 (70) (626)
Total liabilities 31,432 (799) 0 210 194,794 11,111
SHAREHOLDERS' EQUITY:
Capital stock 912 15,501 501 4,001 15,179 2,350
Additional capital 59,849 63,330 10,185
Unrealized holding gains 0
Retained earnings 32,622 (46) 555 (5,649) (9,025)
Treasury stock 0 (83)
Division investment 0
Total shareholders' equity 93,383 15,455 501 4,556 72,860 3,427
TOTAL 124,815 14,656 501 4,766 267,654 14,538
A&B - HAWAII, INC.
CONSOLIDATING BALANCE SHEET, CONTINUED
DECEMBER 31, 1994
($000 omitted)
MCBF KCC KTS OC EMI
CURRENT LIABILITIES:
Notes payable 0 0
Current portion long-term debt 0 0
Current portion capital leases 0 0
Accounts payable 86 135
Payrolls and vacation pay 85 127 20
Income taxes - current (2,136) 13 (22) (8)
Income taxes - deferred (19) (268) (9)
Other taxes 6 14
Postretirement benefits 31 164 21
Uninsured claims 0 0
Reserve for drydocking 0 0
Other liabilities 18 33
Total current liabilities (2,136) 220 183 0 24
LONG-TERM LIABILITIES:
Long-term debt 0 0
Long-term interco notes payable 0 0
Capital lease obligations 0 0
Postretirement benefits 640 2,180 294
Other 1,120 (285) (1,217) 5
Total long-term liabilities 1,120 355 963 0 299
DEFERRED CREDITS:
Deferred income taxes 1,960 26 98 (115)
Deferred income 0 0
Total deferred credits 1,960 26 98 0 (115)
Total liabilities 944 601 1,244 0 208
SHAREHOLDERS' EQUITY:
Capital stock 1 1 1 2 1,427
Additional capital 8,669 250 2,917 902
Unrealized holding gains 0 0
Retained earnings 2,171 1,796 901 375
Treasury stock 0 0
Division investment 3,131 0 0
Total shareholders' equity 13,972 2,047 3,819 2 2,704
TOTAL 14,916 2,648 5,063 2 2,912
ALEXANDER & BALDWIN, INC.
CONSOLIDATING STATEMENT OF RETAINED EARNINGS
FOR THE YEAR ENDED DECEMBER 31, 1994
($000 omitted)
ABIC Elim ABI MNC ABHIC
Balance at December 31, 1993 525,192 (432,684) 525,192 378,458 54,226
Net income 74,608 0 606 62,737 11,265
Dividends to shareholders (40,563) (40,563) 0
Capital stock purchased and retired (17,175) (17,175) 0
Intercompany dividends 0 60,000 0 (60,000) 0
Stock acquired in payment of options (152) (152) 0
Investment in subsidiaries, changed from
cost to equity method 0 (76,237) 76,237
Other 0 3,559 (2,235) (1,324)
Balance at December 31, 1994 541,910 (445,362) 541,910 381,195 64,167
A&B - HAWAII, INC.
CONSOLIDATING STATEMENT OF RETAINED EARNINGS
FOR THE YEAR ENDED DECEMBER 31, 1994
($000 omitted)
ABHIC Elim ABHI ABP ABD
Balance at December 31, 1993 54,226 (82,458) 54,226 59,426 6,408
Net income 11,265 (1,294) (2,556) 14,619 186
Dividends to shareholders 0 0
Capital stock purchased and retired 0 0
Intercompany dividends 0 10,511 0 (10,511)
Stock acquired in payment of options 0 0
Investment in subsidiaries changed from 0
cost to equity method (24,681) 24,681
Other (1,324) 2,796 (10,860) (26)
Balance at December 31, 1994 64,167 (95,126) 65,491 63,508 6,594
A&B - HAWAII, INC.
CONSOLIDATING STATEMENT OF RETAINED EARNINGS
FOR THE YEAR ENDED DECEMBER 31, 1994
($000 omitted)
WDCI KDC SSR SSC C&H MCB
Balance at December 31, 1993 24,653 (1) 2,539 (9,711)
Net income 8,067 (45) 555 (8,188) 686
Dividends to shareholders
Capital stock purchased and retired
Intercompany dividends
Stock acquired in payment of options
Investment in subsidiaries changed from
cost to equity method
Other (98)
Balance at December 31, 1994 32,622 (46) 0 555 (5,649) (9,025)
A&B - HAWAII, INC.
CONSOLIDATING STATEMENT OF RETAINED EARNINGS
FOR THE YEAR ENDED DECEMBER 31, 1994
($000 omitted)
MCBF KCC KTS OC EMI
Balance at December 31, 1993 (2,989) 1,809 (48) 0 372
Net income (1,706) (11) 949 3
Dividends to shareholders
Capital stock purchased and retired
Intercompany dividends
Stock acquired in payment of options
Investment in subsidiaries changed from
cost to equity method
Other 6,866 (2)
Balance at December 31, 1994 2,171 1,796 901 0 375
LEGEND OF COMPANY REFERENCES IN CONSOLIDATING FINANCIAL SCHEDULES:
ABIC Alexander & Baldwin, Inc. Consolidated
Elim Eliminations
ABI Alexander & Baldwin, Inc.
MNC Matson Navigation Company, Inc.
ABHIC A&B - Hawaii, Inc. Consolidated
ABHI A&B - Hawaii, Inc.
ABP A&B Properties, Inc.
ADB A&B Development Co. (Calif), Inc.
WDCI Wailea Development Co., Inc.
KDC Kukuiula Development Co., Inc.
SSR South Shore Resources, Inc.
SSC South Shore Community Services, Inc.
C&H California & Hawaiian Sugar Co.
MCB McBryde Sugar Co., Limited
MCBF McBryde Farms, Inc.
KCC Kauai Commercial Co., Inc.
KTS Kahului Trucking & Storage, Inc.
OC Ohanui Corp.
EMI East Maui Irrigation Company Limited
NOTES TO FINANCIAL STATEMENTS
ALEXANDER & BALDWIN, INC. AND SUBSIDIARIES
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF CONSOLIDATION: The consolidated financial statements include the
accounts of Alexander & Baldwin, Inc. and all subsidiaries, after elimination
of significant intercompany amounts.
OCEAN TRANSPORTATION: Voyage revenue and variable costs and expenses are
included in income at the time each voyage commences.
Vessel depreciation, charter hire, terminal operating overhead and general and
administrative expenses are charged to expense as incurred. Expected costs of
regularly-scheduled dry docking of vessels and planned major vessel repairs
performed during dry docking are accrued.
CONTAINER LEASING: Revenue and maintenance and repair costs are recorded
ratably over the terms of specific lease and rental agreements. Container
depreciation and general and administrative expenses are charged to expense as
incurred. Interest expense is included in cost of services.
PROPERTY DEVELOPMENT AND MANAGEMENT: Sales are recorded when the risks and
benefits of ownership have passed to the buyers (generally at closing dates),
adequate down payments have been received and collection of remaining balances
is reasonably assured.
Expenditures for real estate developments are capitalized during construction
and are classified either as Property or as Real Estate Held For Sale when
construction is complete, based upon the Company's intent. Cash flows related
to real estate developments are classified as operating or investing
activities, based upon the Company's intention either to sell the property or
to retain ownership of the property as an investment following completion of
construction.
FOOD PRODUCTS: Revenue is recorded when refined sugar products and coffee are
sold to third parties.
Costs of growing sugar cane are charged to the cost of production in the year
incurred and to cost of sales as refined products are sold. The cost of raw
cane sugar purchased from third parties is recorded as inventory at the
purchase price.
Costs of developing coffee are capitalized during the development period and
depreciated over the estimated productive lives of the orchards. Costs of
growing coffee are charged to inventory in the year incurred and to cost of
sales as coffee is sold.
CASH AND CASH EQUIVALENTS: The Company considers highly liquid investments
purchased with original maturities of three months or less, which have no
significant risk of change in value, to be cash equivalents.
INVENTORIES: Sugar inventory, consisting of raw and refined sugar, is stated
at the lower of cost (first-in, first-out basis) or market. Other
inventories, composed principally of materials and supplies, are stated at the
lower of cost (principally average cost) or market.
PROPERTY: Property is stated at cost. Major renewals and betterments are
capitalized. Replacements, maintenance and repairs which do not improve or
extend asset lives are charged to expense as incurred. Assets held under
capital leases are included with property owned. Gains or losses from
property disposal are included in income.
CAPITALIZED INTEREST: Interest costs incurred in connection with significant
expenditures for real estate developments or the construction of assets are
capitalized.
DEPRECIATION: Depreciation is computed using the straight-line method.
Depreciation expense includes amortization of assets under capital leases and
vessel spare parts.
Estimated useful lives of property are as follows:
Buildings 10 to 50 years
Vessels 14 to 40 years
Marine containers 15 years
Machinery and equipment 3 to 35 years
Utility systems and other
depreciable property 5 to 60 years
OTHER NON-CURRENT ASSETS: Other non-current assets consist principally of
supply contracts and other intangible assets. These assets are being
amortized using the straight-line method over periods not exceeding 30 years.
PENSION PLANS: Certain ocean transportation subsidiaries are members of the
Pacific Maritime Association (PMA), the Maritime Service Committee or the
Hawaii Stevedore Committee, which negotiate multi-employer pension plans
covering certain seagoing and shoreside bargaining unit personnel. The
subsidiaries negotiate multi-employer pension plans covering other bargaining-
unit personnel. Pension costs are accrued in accordance with contribution
rates established by the PMA, the parties to a plan or the trustees of a plan.
Several trusteed, noncontributory, single-employer defined benefit plans cover
substantially all other employees.
INCOME TAXES: Current income tax expense is based on revenue and expenses in
the Statements of Income. Deferred income tax liabilities and assets are
computed at current tax rates for temporary differences between the financial
statements and income tax returns.
FAIR VALUES: The carrying values of current assets (other than inventories,
real estate held for sale, deferred income taxes and prepaid and other assets)
and of debt instruments are reasonable estimates of their fair values.
FUTURES CONTRACTS: Realized and unrealized gains and losses on commodity
futures contracts are deferred and recorded in inventory in the period in
which the related inventory purchases occur. These amounts are not
significant.
ENVIRONMENTAL COSTS: Environmental expenditures that relate to current
operations are expensed or capitalized as appropriate. Expenditures that
relate to an existing condition caused by past operations or events and which
do not contribute to current or future revenue generation, are charged to
expense. Liabilities are recorded when environmental assessments or remedial
efforts are probable and the costs can be reasonably estimated.
RECLASSIFICATION: Certain amounts in the 1993 and 1992 financial statements
have been reclassified to conform with the 1994 presentation.
2. POST-RETIREMENT BENEFIT PLANS
The Company has plans that provide certain retiree health care and life
insurance benefits to substantially all salaried and to certain hourly
employees. Employees are generally eligible for such benefits upon retirement
and completion of a specified number of years of credited service. The
Company does not pre-fund these benefits and has the right to modify or
terminate certain of these plans in the future. Certain groups of retirees
pay a portion of the benefit costs.
In 1992, the Company adopted the provisions of Statement of Financial
Accounting Standards (SFAS) No. 106, "Employers' Accounting for Postretirement
Benefits Other Than Pensions," which require the accrual of post-retirement
benefits during the years an employee provides services to the Company. Prior
to 1992, the costs of such benefits (principally medical and group life
insurance premiums) were charged to expense on a pay-as-you-go basis. The
Company elected to immediately recognize the accumulated post-retirement
benefit obligation upon adoption of the Standard. The cumulative effect of
this accounting change as of January 1, 1992, resulted in a decrease in net
income of $41,551,000, or $0.90 per share, in 1992.
The net periodic cost for post-retirement health care and life insurance
benefits during 1994, 1993 and 1992 included the following:
1994 1993 1992
(In thousands)
Service cost $ 2,149 $1,524 $1,420
Interest cost 7,825 4,742 4,598
Net amortization (216) - -
Post-retirement benefit cost $ 9,758 $6,266 $6,018
The unfunded accumulated post-retirement benefit obligation at December 31,
1994 and 1993 is summarized below:
1994 1993
(In thousands)
Accumulated post-retirement
benefit obligation:
Retirees $ 64,619 $ 70,246
Fully-eligible active
plan participants 10,577 10,924
Other active plan participants 30,359 33,668
Unrecognized prior service cost 3,215 2,810
Unrecognized net gain 14,422 1,926
Total 123,192 119,574
Current obligation 6,582 6,676
Non-current obligation $116,610 $112,898
For 1994 and 1993, the weighted average discount rates used in determining the
accumulated post-retirement benefit obligation were 8% and 7%, respectively,
and the assumed health care cost trend rate used in measuring the accumulated
post-retirement benefit obligation for both years was 10% for 1993 through
2001, decreasing to 5% thereafter. If the assumed health care cost trend rate
were increased by one percentage point, the accumulated post-retirement
benefit obligation as of December 31, 1994 and 1993 would have increased by
approximately $12,235,000 and $13,386,000, respectively, and the net periodic
post-retirement benefit cost for 1994 and 1993 would have increased by
approximately $2,153,000 and $989,000, respectively.
3. EMPLOYEE BENEFIT PLANS
Total contributions to the multi-employer pension plans covering personnel in
shoreside and seagoing bargaining units were $8,216,000 in 1994, $8,626,000 in
1993 and $7,638,000 in 1992. Union collective bargaining agreements provide
that total employer contributions during the terms of the agreements be
sufficient to meet the normal costs and amortization payments required to be
funded during those periods. Contributions are generally based on union labor
used or cargo handled or carried. A portion of such contributions is for
unfunded accrued actuarial liabilities of the plans being funded over periods
of 25 to 40 years, which began between 1967 and 1976.
The multi-employer plans are subject to the plan termination insurance
provisions of the Employee Retirement Income Security Act of 1974, as amended,
and are paying premiums to the Pension Benefit Guarantee Corporation (PBGC).
The statutes provide that an employer which withdraws from or significantly
reduces its contribution obligation to a multi-employer plan generally will be
required to continue funding its proportional share of the plan's unfunded
vested benefits.
In 1994, a subsidiary terminated a single-employer defined benefit pension
plan covering longshore personnel in Hawaii. Concurrently, the subsidiary
joined a multi-employer pension plan with the other major stevedoring
companies in Hawaii. As a result of this action, the previously-recorded
unfunded pension obligation of the terminated single-employer plan of
$2,348,000 was eliminated. This elimination was recorded as a reduction of
expenses in the Statements of Income. All employees previously covered under
the single-employer plan are now covered under the multi-employer plan without
loss of vesting or benefits.
Under special rules approved by the PBGC and adopted by the longshore plan in
1984, the Company could cease Pacific Coast cargo-handling operations
permanently and stop contributing to the plan without any withdrawal
liability, provided that the plan meets certain funding obligations as defined
in the plan. The estimated withdrawal liabilities under the Hawaii longshore
plan and the seagoing plans aggregated approximately $7,378,000 for various
plan years ended December 1994 and 1993, and July 1994, based on estimates by
plan actuaries. Management has no present intention of withdrawing from and
does not anticipate termination of any of the aforementioned plans.
The net cost (benefit) of single-employer defined benefit pension plans,
covering substantially all other employees, was $3,816,000 in 1994, $4,318,000
in 1993 and $(510,000) in 1992. Expense components for all single-employer
plans for the three years were as follows:
1994 1993 1992
(In thousands)
Service cost--benefits earned
during the year $ 7,317 $ 5,907 $ 4,528
Interest cost on projected
benefit obligations 20,542 17,584 11,755
Actual return on plan assets (24,122) (18,776) (14,252)
Net amortization and deferral (1,221) (2,514) (2,541)
Curtailment and termination
benefits 1,300 2,117 -
Net pension cost (benefit) $ 3,816 $4,318 $ (510)
The funded status of the single-employer plans at December 31, 1994 and 1993
was as follows:
1994 1993
(In thousands)
Assets Accumulated Assets Accumulated
Exceed Benefits Exceed Benefits
Accumulated Exceed Accumulated Exceed
Benefits Assets Benefits Assets
Actuarial present value of
benefit obligation:
Vested benefits $122,153 $112,925 $138,110 $113,585
Non-vested benefits 3,830 4,297 6,853 3,102
Accumulated benefit
obligation 125,983 117,222 144,963 116,687
Additional amounts
related to projected
compensation levels 22,927 11,277 29,180 15,707
Projected benefit
obligation 148,910 128,499 174,143 132,394
Plan assets at fair value 178,118 104,867 202,071 102,527
(Excess) Deficiency of
plan assets over
projected benefit
obligation. (29,208) 23,632 (27,928) 29,867
Prior service costs to be
recognized in future
years (2,121) (1,656) (2,551) (1,576)
Unrecognized actuarial
net gain (loss) 27,468 (1,227) 25,517 (3,326)
Unrecognized net asset
(obligation) at January 1,
1987 (being amortized over
periods of 4 to 15 years) 4,660 385 6,428 (293)
Accrued pension liability $ 799 $ 21,134 $ 1,466 $24,672
For 1994 and 1993, projected benefit obligations were determined using
discount rates of 8% and 7%, respectively, and assumed increases in future
compensation levels of 5% for both years. The expected long-term rate of
return on assets for both years was 8 1/4%. The assets of the plans consist
principally of listed stocks and bonds.
The Company has non-qualified supplemental pension plans covering certain
employees and retirees, which provide for incremental pension payments from
the Company's general funds, so that total pension benefits would be
substantially equal to amounts that would have been payable from the Company's
qualified pension plans if it were not for limitations imposed by income tax
regulations. The projected benefit obligation, included with other non-
current liabilities, relating to these unfunded plans, totaled $7,661,000 and
$7,285,000 at December 31, 1994 and 1993, respectively.
4. INVESTMENTS
At December 31, 1994 and 1993, investments principally consisted of marketable
equity securities, limited partnership interests and purchase-money mortgages.
Effective January 1, 1994, the Company adopted SFAS No. 115, "Accounting for
Certain Investments in Debt and Equity Securities." The marketable equity
securities are classified as "available for sale" and are, at December 31,
1994, stated at quoted market values totaling $56,312,000 (cost basis
$9,966,000). The unrealized holding gain on these securities as of December
31, 1994 amounted to $29,073,000, net of deferred income taxes, and has been
recorded as a separate component of shareholders' equity.
At December 31, 1993, these securities were stated at their historical cost
basis of $10,486,000 (quoted market value was $64,129,000).
The remaining investments are recorded at cost, which approximated market
values, of $8,601,000 and $6,963,000 at December 31, 1994 and 1993,
respectively.
See Note 9 for a discussion of market values of investments in the Capital
Construction Fund.
5. LEASES
THE COMPANY AS LESSEE: Various subsidiaries of the Company lease a vessel
and certain land, buildings and equipment under both capital and operating
leases. Capital leases include one vessel leased for a term of 25 years
ending in 1998; containers, machinery and equipment for terms of 5 to 12 years
expiring through 1997; and a wastewater treatment facility in California, the
title of which will revert to a subsidiary in 2002. Principal operating
leases cover office and terminal facilities for periods which expire between
1995 and 2026. Management expects that in the normal course of business, most
operating leases will be renewed or replaced by other leases.
Rental expense under operating leases for the three years ended December 31,
1994 is shown below:
1994 1993 1992
(In thousands)
Minimum rentals $47,500 $43,050 $43,212
Contingent rentals 669 220 330
Total $48,169 $43,270 $43,542
Contingent rentals are based principally on the use of certain terminal and
port facilities and the use of agricultural water and land. Payments for
certain leased terminal and port facilities are compensated by charges under
tariffs paid by others. Income from sublease rentals is not significant.
Assets recorded under capital lease obligations and included in property at
December 31, 1994 and 1993 were as follows:
1994 1993
(In thousands)
Vessels $ 55,253 $ 55,253
Machinery and equipment 42,870 50,056
Total 98,123 105,309
Less accumulated amortization 86,115 80,021
Property under capital leases--net $ 12,008 $ 25,288
Future minimum payments under all leases and the present value of minimum
capital lease payments as of December 31, 1994 were as follows:
Capital Operating
Leases Leases
(In thousands)
1995 $11,935 $27,120
1996 14,759 17,654
1997 15,026 15,223
1998 10,703 14,849
1999 609 14,870
Thereafter 1,641 121,405
Total minimum lease payments 54,673 $211,121
Less amount representing interest 11,461
Present value of future minimum payments 43,212
Less current portion 7,938
Long-term obligations at December 31, 1994 $35,274
As described in Note 6, a subsidiary is obligated to pay principal of and
interest on Special Facility Revenue Bonds issued by the Department of
Transportation of the State of Hawaii to finance construction of terminal
facilities which are leased by a subsidiary. Rent expense for the facilities
includes bond interest. An accrual, included in long-term debt, provides for
a pro-rata portion of the principal due on these bonds.
THE COMPANY AS LESSOR: Various Company subsidiaries lease land, buildings,
land improvements and marine containers under operating leases. The
historical cost of and accumulated depreciation on leased property at December
31, 1994 and 1993 were as follows:
1994 1993
(In thousands)
Leased property $578,190 $568,280
Less accumulated amortization 97,793 74,621
Property under operating leases--net $480,397 $493,659
Total rental income under these operating leases for the three years ended
December 31, 1994 was as follows:
1994 1993 1992
(In thousands)
Minimum rentals $57,864 $58,838 $55,358
Contingent rentals (based
on sales volume) 1,515 1,111 1,160
Total $59,379 $59,949 $56,518
Future minimum rental income on non-cancelable leases at December 31, 1994 was
as follows:
Operating
Leases
(In thousands)
1995 $ 48,234
1996 42,160
1997 33,554
1998 20,832
1999 15,674
Thereafter 164,777
Total $325,231
6. LONG-TERM DEBT, CREDIT AGREEMENTS
At December 31, 1994 and 1993, long-term debt consisted of the following:
1994 1993
(In thousands)
Commercial paper, 3.2% - 6.3%, due 1995 $304,301 $310,908
Bank revolving credit loans (1994 high 6.63%, low 3.63%)
due after 1994 52,500 61,000
Term loans:
7.19%, payable through 2007 75,000 75,000
9%, payable through 1999 50,000 50,000
8%, payable through 2000 50,000 50,000
9.05%, payable through 1999 32,611 37,558
9.8%, payable through 2004 20,833 22,917
7.65%, payable through 2001 10,000 10,000
11.78%, payable through 1997 1,848 2,361
9.1%, repaid in 1994 - 22,000
10.03%, repaid in 1994 - 3,300
Mortgage loans, collateralized by
land and buildings:
11%, payable through 1995 3,046 3,091
12.5%, payable through 1995 2,724 2,765
Other 281 29
Limited partnership subscription
notes, no interest,
payable through 1996 1,700 2,550
Special facility revenue bonds,
5.75%, payable 2013 6,626 6,083
Total 611,470 659,562
Less current portion 27,239 13,089
Commercial paper classified
as current 58,000 64,000
Long-term debt $526,231 $582,473
REVOLVING CREDIT FACILITIES: The Company and a subsidiary have a revolving
credit and term loan agreement with five commercial banks, whereby they may
borrow up to $155,000,000 under revolving loans to November 30, 1996 at
varying rates of interest. Any revolving loan outstanding on that date may be
converted into a term loan, which would be payable in 16 equal quarterly
installments. The agreement contains certain restrictive covenants, the most
significant of which requires the maintenance of an interest coverage ratio of
2:1. At December 31, 1994 and 1993, $20,000,000 and $55,000,000,
respectively, were outstanding under this agreement.
The Company and a subsidiary have an uncommitted $65,000,000 short-term
revolving credit agreement with a commercial bank. The agreement extends to
November 30, 1995, but may be canceled by the bank at any time. At December
31, 1994 and 1993, $12,500,000 and $6,000,000, respectively, were outstanding
under this agreement.
In 1994, the Company and a subsidiary entered into an uncommitted $25,000,000
revolving credit agreement with a commercial bank. The agreement extends to
July 18, 1997. At December 31, 1994, $20,000,000 was outstanding under this
agreement.
A subsidiary has a $25,000,000 two-year revolving credit agreement with a
financial institution to provide general corporate funds. At December 31,
1994 and 1993, no balances were outstanding under this agreement.
A subsidiary has a $25,000,000 revolving credit agreement maturing April 1995.
This agreement serves as a commercial paper liquidity back-up line. The
Company intends to renew this agreement upon maturity. At December 31, 1994
and 1993, no balances were outstanding under this agreement.
TERM LOANS: In 1993, an unsecured series of 19 notes, which aggregated
$75,000,000, with varying maturity dates ranging from 1997 through 2007, and
with interest rates ranging from 6.23% to 7.46% (average 7.19%), were entered
into in connection with the acquisition of California and Hawaiian Sugar
Company, Inc. (C&H).
As a result of the purchase of C&H, a subsidiary has a term loan with
outstanding balances of $20,833,000 and $22,917,000 at December 31, 1994 and
1993, respectively. Annual principal payments of $2,083,000 are payable
through 2004. Interest, at 9.8%, is payable quarterly. The loan is
guaranteed by the subsidiary's parent and the Company.
COMMERCIAL PAPER: There are three commercial paper programs.
The first program was used by a subsidiary to finance the construction of a
vessel, which was completed in 1992. At December 31, 1994, $149,570,000 of
commercial paper notes was outstanding under this program. Maturities ranged
from 3 to 41 days. The borrowings outstanding under this program are
classified as long-term since the subsidiary intends to continue the program
indefinitely, and eventually to repay the program with qualified withdrawals
from the Capital Construction Fund.
The second commercial paper program, which commenced in 1992, was used to
finance the acquisition of marine containers. At December 31, 1994,
$82,731,000 of commercial paper notes was outstanding under this program.
Maturities ranged from 4 to 37 days. The commercial paper borrowings
outstanding under this program are classified as long-term since the
subsidiary intends to continue this program on a long-term basis and has
established the necessary credit facilities to do so. At December 31, 1994,
$100,000,000 of long-term revolving credit facilities was available to support
these outstanding notes.
The third commercial paper program is used by a subsidiary to fund the
purchases of sugar inventory from Hawaii sugar growers and to provide working
capital for sugar refining and marketing operations. At December 31, 1994,
$72,000,000 of commercial paper notes was outstanding under this program. The
interest cost and certain fees on the borrowings relating to sugar inventory
advances to growers are paid by the growers rather than by the subsidiary. At
December 31, 1994, no amounts were outstanding as advances to growers under
this program. Maturities ranged from 4 to 34 days. Of the total commercial
paper borrowing, $58,000,000 was classified as current. The commercial paper
is supported by a $100,000,000 backup revolving credit facility with six
commercial banks. Both the commercial paper program and the backup facility
are guaranteed by the subsidiary's parent and the Company.
SPECIAL FACILITY REVENUE BONDS: A subsidiary is obligated to pay principal of
and interest on $16,500,000 of 5.75% Special Facility Revenue Bonds issued in
1993 and due in 2013. An accrual is included in long-term debt for the pro-
rata portion of the principal due on these bonds (see Note 5).
LONG-TERM DEBT MATURITIES: At December 31, 1994, maturities and planned
prepayments of all long-term debt during the next five years totaled
$27,239,000 for 1995, $36,542,000 for 1996, $36,718,000 for 1997, $29,210,000
for 1998 and $37,377,000 for 1999.
7. INCOME TAXES
The provision for income taxes for the three years ended December 31, 1994
consisted of the following:
1994 1993 1992
(In thousands)
Current:
Federal $15,189 $13,275 $9,908
State 260 2,167 435
Total 15,449 15,442 10,343
Deferred 23,178 30,738 13,332
Provision for income taxes $38,627 $46,180 $23,675
Total income tax expense for the three years ended December 31, 1994 differs
from amounts computed by applying the statutory Federal rate to pre-tax
income, for the following reasons:
1994 1993 1992
(In thousands)
Computed income tax expense $39,632 $39,609 $28,621
Increase (decrease) resulting from:
Tax rate increases - 7,741 -
State tax on income, less
applicable Federal tax 1,542 1,417 2,106
Resolution of tax audits - - (2,506)
Fair market value over
cost of donations (2,138) - (1,927)
Low-income housing credits (1,219) (1,214) (1,214)
Other-net 810 (1,373) (1,405)
Provision for income taxes $38,627 $46,180 $23,675
The tax effects of temporary differences that give rise to significant
portions of the net deferred tax liability at December 31, 1994 and 1993 were
as follows:
1994 1993
(In thousands)
Deposits to the CCF $201,963 $198,414
Accelerated depreciation 111,253 101,252
Tax-deferred gains on real estate
transactions 68,488 64,469
Unrealized holding gains on securities 17,273 -
Post-retirement benefits (45,209) (45,041)
Alternative minimum tax benefits (6,531) (5,893)
Capitalized leases 2,409 (6,328)
Insurance reserves (1,759) (4,813)
Other-net (13,292) (5,653)
Total $334,595 $296,407
The Internal Revenue Service has completed audits of the Company's tax returns
through 1988 and, with one exception, has tentatively settled all issues
raised during such audits. The settlements had no material effect on the
Company's financial position or results of operations. The Company is
contesting the remaining issue, which relates to the timing of certain
deductions for tax purposes. Management believes that the ultimate resolution
of this issue will not have a material effect on the Company's financial
position.
8. CAPITAL STOCK AND STOCK OPTIONS
A&B has a stock option plan ("1989 Plan") under which key employees may be
granted stock purchase options and stock appreciation rights. A second stock
option plan for key employees terminated in 1993, but shares previously
granted under the plan are still exercisable. Under the 1989 Plan, option
prices may not be less than the fair market value of a share of the Company's
common stock on the dates of grant, and each option generally becomes
exercisable in-full one year after the date granted. Payment for options
exercised, to the extent not reduced by the application or surrender of stock
appreciation rights, may be made in cash or in shares of the Company's stock.
If payment is made in shares of the Company's stock, the option holder may
receive, under a reload feature of the 1989 Plan, a new stock option for the
number of shares equal to that surrendered, with an option price not less than
at the fair market value of the Company's stock on the date of exercise.
During 1994, 448,200 new options were granted under the 1989 Plan.
The 1989 Plan also permits issuance of shares of the Company's common stock as
a reward for past service rendered to the Company or one of its subsidiaries
or as an incentive for future service with such entities. The recipients'
interest in such shares may be fully vested upon issuance or may vest in one
or more installments, upon such terms and conditions as are determined by the
committee which administers the plan.
The Company also has a Directors' stock option plan, under which each non-
employee Director of the Company, elected at an Annual Meeting of
Shareholders, is automatically granted, on the date of each such Annual
Meeting, an option to purchase 3,000 shares of the Company's common stock at
the average fair market value of the shares for the five consecutive trading
days prior to the grant date. Each option becomes exercisable six months
after the date granted. At December 31, 1994, a total of 150,000 options have
been granted under the plan, 3,000 options have been cancelled and no options
have been exercised.
Changes in shares under all option plans for the three years ended December
31, 1994, were as follows:
Price Range
Shares Per Share
1992: Outstanding, January 1 1,383,205 $17.375-37.875
Granted 495,665 24.250-28.250
Exercised (126,266) 17.375-24.250
Canceled (41,700) 24.250-36.250
Outstanding, December 31 1,710,904 17.375-37.875
1993: Granted 423,200 24.250-24.500
Exercised (23,576) 17.375-24.750
Canceled (73,400) 24.250-36.250
Outstanding, December 31 2,037,128 17.375-37.875
1994: Granted 475,200 24.700-27.000
Exercised (12,300) 17.375-24.750
Canceled (55,996) 24.250-36.250
Outstanding, December 31
(1,996,051 exercisable) 2,444,032 $17.375-37.875
Options outstanding at December 31, 1994 include 60,166 shares which carry
stock appreciation rights. The outstanding options do not have a material
dilutive effect in the calculation of earnings per share of common stock.
The Company has a Shareholder Rights Plan, designed to protect the interests
of shareholders in the event an attempt is made to acquire the Company. The
rights initially will trade with the Company's outstanding common stock and
will not be exercisable absent certain acquisitions or attempted acquisitions
of specified percentages of such stock. If exercisable, the rights generally
entitle shareholders to purchase additional shares of the Company's stock or
shares of an acquiring company's stock at prices below market value.
9. CAPITAL CONSTRUCTION FUND
A subsidiary is party to an agreement with the United States Government which
established a Capital Construction Fund (CCF) under provisions of the Merchant
Marine Act, 1936, as amended. The agreement has program objectives for the
acquisition, construction or reconstruction of vessels and for repayment of
existing vessel indebtedness. Deposits to the CCF are limited by certain
applicable earnings. Such deposits are not subject to Federal income taxes in
the year earned, but are taxable, with interest payable from the year of
deposit, if withdrawn for general corporate purposes or other non-qualified
purposes, or upon termination of the agreement. Qualified withdrawals for
investment in vessels having adequate tax bases do not give rise to a current
tax liability, but reduce the depreciable bases of the vessels or other assets
for income tax purposes. Amounts deposited into the CCF are preference items
for inclusion in Federal alternative minimum taxable income. Deposits not
committed for qualified purposes within 25 years from December 31, 1986, or
later date of deposit, will be treated as non-qualified withdrawals.
As discussed in Note 4, in 1994 the Company adopted the provisions of SFAS No.
115. The subsidiary has classified its investments in the CCF as "held-to-
maturity" and, accordingly, has not reflected temporary unrealized market
gains and losses in the Balance Sheets or Statements of Income. The long-term
nature of the CCF program supports the subsidiary's intention to hold these
investments to maturity.
At December 31, 1994 and 1993, the balances on deposit in the CCF consisted of
the following (in thousands):
1994 1993
UNREALIZED Amortized
AMORTIZED COST FAIR VALUE LOSS Cost
Mortgage-backed securities $ 108,247 $ 96,678 $ (11,569) $ 127,871
Cash and cash equivalents 64,263 64,263 - 48,106
Treasury notes 2,984 2,984 - -
Accrued deposits
(withdrawals) 550 550 - (783)
Total $ 176,044 $ 164,475 $ (11,569) $ 175,194
Fair value of the mortgage-backed securities ("MBS") was determined by an
outside investment management company, based on the experience of trading
identical or substantially similar securities. No central exchange exists for
these securities; they are traded over-the-counter.
During 1994, the fair value of the subsidiary's investments in MBS declined in
relation to amortized cost, due to interest rate sensitivity inherent in the
fair value determination of such securities. While a temporary unrealized
market loss exists, the subsidiary intends to hold these investments to
maturity, which ranges from 1995 through 2024. The MBS have a weighted
average life of 4.5 years. The Company had earnings of $8,292,000 in 1994,
$7,218,000 in 1993 and $11,293,000 in 1992 from its MBS investment account.
Fair values of the remaining CCF investments were based on quoted market
prices, if available. If a quoted market price was not available, fair value
was estimated, using quoted market prices of similar securities and
investments. These remaining investments mature in 1995.
During 1994, there were no sales of securities classified as "held-to-
maturity" included in the CCF.
10. RELATED PARTY TRANSACTIONS, COMMITMENTS AND CONTINGENCIES
At December 31, 1994, the Company and its subsidiaries had an unspent balance
of total appropriations for capital expenditures of approximately
$104,677,000. However, there is no contractual obligation to spend this
entire amount.
A subsidiary has arranged for standby letters of credit of approximately
$15,800,000, necessary to qualify as a self-insurer for state and federal
workers' compensation liabilities.
Bank letters of credit have been issued on behalf of a subsidiary in favor of
certain container manufacturers. When presented, these letters may be paid,
at the subsidiary's option, by a back-up line of credit. At December 31,
1994, $1,585,000 was outstanding under these letters of credit.
A subsidiary is party to a five-year agreement with a computer processing
service, expiring in 1996, to provide off-site mainframe processing. The
annual average cost of this agreement is $4,150,000.
A subsidiary has received a favorable court judgment resulting from a
contested insurance claim. The claim was for reimbursement of certain
expenses incurred by the subsidiary in connection with repairing port
facilities damaged by a 1989 earthquake. Although the award has been
appealed, management and its outside counsel believe that the ultimate outcome
of this litigation will be an award at least equal to the claim recorded in
the financial statements.
A subsidiary is a party, acting as the steam host, to a Steam Purchase
Agreement with a developer who has received regulatory authority approval to
construct and operate a cogeneration facility contiguous to the subsidiary's
California refinery. The agreement provides that, during the 30-year period
of the agreement, the subsidiary will receive steam necessary for refinery
operations at a reduced price, compared to the market price of fuel which
presently must be purchased to generate its steam requirements.
A subsidiary is party to a long-term sugar supply contract with Hawaiian Sugar
& Transportation Cooperative (HSTC), a raw sugar marketing and transportation
cooperative owned by two other subsidiaries and by the other Hawaii sugar
growers. Under the terms of this contract, the subsidiary is obligated to
purchase, and HSTC is obligated to sell, all of the raw sugar delivered to
HSTC by the Hawaii sugar growers, at prices determined by the quoted domestic
sugar market. The subsidiary made purchases of raw sugar totaling
$271,212,000 and $134,700,000 under the contract during 1994 and 1993,
respectively. The contract also requires that the subsidiary provide cash
advances to HSTC prior to the physical receipt of the sugar at its refineries
(see Note 6). Such advances are determined by the estimated raw sugar market
prices. Amounts due to HSTC upon delivery of raw sugar to the subsidiary's
refineries are offset against outstanding advances to HSTC.
The Company and certain subsidiaries are parties to various legal actions and
are contingently liable in connection with claims and contracts arising in the
normal course of business, the outcome of which, in the opinion of management
after consultation with legal counsel, will not have a material adverse effect
on the Company's financial position.
11. INDUSTRY SEGMENTS
Industry segment information for 1994, 1993 and 1992, on page 25, is
incorporated herein by reference. Segments are:
Ocean transportation -- carrying freight between various U.S. and Canadian
West Coast, Hawaii and Western Pacific ports, and providing terminal services.
Container leasing -- leasing marine containers in international markets.
Property development and management -- developing, managing and selling
residential, commercial and industrial properties.
Food products -- growing, processing and marketing sugar, molasses and coffee,
and generating and selling electricity.
EXHIBIT B
ALEXANDER & BALDWIN, INC. AND SUBSIDIARIES
FINANCIAL DATA SCHEDULE
DECEMBER 31, 1993
(In Thousands)
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE CONSOLIDATING BALANCE SHEET AND CONSOLIDATING INCOME
STATEMENT IS IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
Item No. Caption Heading
1 Total Assets $ 1,932,788
2 Total Operating Revenues $ 1,185,210
3. Net Income $ 74,608
