Less than a year after beginning service, a new service to Shanghai, Alexander & Baldwin, parent of Matson, said its foray into China is profitable. It helped boost the overall company's fourth-quarter net income 15.4% over the previous year.

Allen Doane, chairman and chief executive of A&B, said, 'The momentum of this service affirms our belief that Matson has established a superior reputation in China less than a year after its entry into that burgeoning marketplace.' Matson began service to China in February.

Allen Doane said, '2006 was a good year for Alexander & Baldwin, and it ended on a particularly positive note, providing momentum and a firm foundation for growth in the coming year.'

San Francisco-based analyst Jason Kremer of Caris & Co. said A&B's China operation is proving more successful than initially expected. He said, 'They have a superior service in that their ships can do the routes in less time (10.2 days) than their competitors. Basically, the key for them is to be able to leverage that value add, which they have not been able to do yet to get higher rates going forward. If they can get a better mix of products or find companies that are willing to pay up for the quicker shipments, that would even be better.'

A&B Chief Financial Officer Chris Benjamin said Matson's ships can get goods from Shanghai to Long Beach faster than its competitors, not because Matson's vessels are any faster but because most of its competitors make a couple of stops along the way.

He said, 'We can get the cargo off the ship and to our customers two to three days faster than our competitors because we have non-stop service and a dedicated terminal for unloading the cargo.'