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GENERAL AND SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended
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Mar. 31, 2025
GENERAL AND SIGNIFICANT ACCOUNTING POLICIES |
GENERAL AND SIGNIFICANT ACCOUNTING POLICIES | 2. GENERAL AND SIGNIFICANT ACCOUNTING POLICIES ​ Basis of Presentation: The Condensed Consolidated Financial Statements are unaudited, and include the accounts of Matson, Inc. and all wholly-owned subsidiaries, after elimination of intercompany amounts and transactions. Significant investments in businesses, partnerships, and limited liability companies in which the Company does not have a controlling financial interest, but has the ability to exercise significant influence, are accounted for under the equity method. The Company accounts for its investment in SSAT using the equity method of accounting. ​ Due to the nature of the Company’s operations, the results for interim periods are not necessarily indicative of results to be expected for the year. These Condensed Consolidated Financial Statements reflect all normal recurring adjustments that are, in the opinion of management, necessary for fair presentation of the results of the interim periods, and do not include all of the information and footnotes required by U.S. generally accepted accounting principles for complete consolidated financial statements. ​ The Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, filed with the Securities and Exchange Commission (“SEC”) on February 28, 2025. ​ Fiscal Period: The period end for Matson covered by this report is March 31, 2025. The period end for MatNav and its subsidiaries covered by this report is March 28, 2025. ​ Significant Accounting Policies: The Company’s significant accounting policies are described in Note 2 to the Consolidated Financial Statements included in Part II, Item 8 of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. ​ Use of Estimates: The preparation of the interim Condensed Consolidated Financial Statements in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the amounts reported. Estimates and assumptions are used for but not limited to: impairment of investments; impairment of long-lived assets, intangible assets and goodwill; capitalized interest; allowance for doubtful accounts and other receivables; legal contingencies; insurance reserves and other related liabilities; contingent acquisition related consideration; accrual estimates; pension and post-retirement estimates; multi-employer withdrawal liabilities; operating lease assets and liabilities; income (loss) from SSAT including estimates for impairment charges; and income taxes. Future results could be materially affected if actual results differ from these estimates and assumptions. ​ Prepaid Expenses and Other Assets: Prepaid expenses and other assets consisted of the following at March 31, 2025 and December 31, 2024: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | March 31, | ​ | December 31,
Prepaid Expenses and Other Assets (in millions) |  | 2025 |  | 2024
Vessel fuel | ​ | $ | 31.6 | ​ | $ | 31.2
Prepaid insurance and insurance related receivables | ​ |  | 17.5 | ​ |  | 19.1
Prepaid operating expenses | ​ | ​ | 8.8 | ​ | ​ | 8.8
Income tax receivables, net | ​ | ​ | 2.6 | ​ | ​ | 2.0
Other | ​ |  | 14.8 | ​ |  | 12.8
Total | ​ | $ | 75.3 | ​ | $ | 73.9
​ Recognition of Revenues and Expenses: Revenue in the Company’s Condensed Consolidated Financial Statements is presented net of elimination of intercompany transactions. The following is a description of the Company’s principal revenue generating activities by segment, and the Company’s revenue recognition policy for each activity for the periods presented: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended |
​ | ​ | March 31, |
Ocean Transportation (in millions) (1) | ​ | 2025 |  | 2024 |
Ocean Transportation services | ​ | $ | 632.9 | ​ | $ | 565.8 | ​
Terminal and other related services | ​ | ​ | 2.5 | ​ | ​ | 8.7 | ​
Fuel sales | ​ | ​ | 2.0 | ​ | ​ | 2.9 | ​
Vessel management and related services | ​ | ​ | — | ​ | ​ | 1.6 | ​
Total | ​ | $ | 637.4 | ​ | $ | 579.0 | ​
(1) | Ocean Transportation revenue transactions are primarily denominated in U.S. dollars except for less than 3 percent of Ocean Transportation services revenue and fuel sales revenue categories which are denominated in foreign currencies.
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◾ | Ocean Transportation services revenue is recognized ratably over the duration of a voyage based on the relative transit time completed in each reporting period. Vessel operating costs and other ocean transportation operating costs, such as terminal operating overhead and general and administrative expenses, are charged to operating costs as incurred.
◾ | Terminal and other related services revenue is recognized as the services are performed. Related costs are recognized as incurred.
◾ | Fuel sales revenue and related costs are recognized when the Company has completed delivery of the product to the customer in accordance with the terms and conditions of the contract.
◾ | Vessel management and related services revenue is recognized in proportion to the services completed. Related costs are recognized as incurred. In July 2024, the Company discontinued its vessel management and related services.
​ ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Three Months Ended |
​ | ​ | March 31, |
Logistics (in millions) (1) | ​ | 2025 | ​ | 2024 | ​
Transportation Brokerage and Freight Forwarding services | ​ | $ | 127.3 | ​ | $ | 127.4 | ​
Warehousing services | ​ | ​ | 9.0 | ​ | ​ | 9.1 | ​
Supply Chain Management services | ​ |  | 8.3 | ​ |  | 6.6 | ​
Total | ​ | $ | 144.6 | ​ | $ | 143.1 | ​
(1) | Logistics revenue transactions are primarily denominated in U.S. dollars except for less than 3 percent of Transportation Brokerage and Freight Forwarding services revenue, and Supply Chain Management services revenue categories which are denominated in foreign currencies.
​
◾ | Transportation Brokerage and Freight Forwarding services revenue consists of amounts billed to customers for services provided. The primary costs include third-party purchased transportation services, agent commissions, labor and equipment. Revenue and the related purchased third-party transportation costs are recognized over the duration of a delivery based upon the relative transit time completed in each reporting period. Labor, agent commissions, and other operating costs are expensed as incurred. The Company reports revenue on a gross basis as the Company serves as the principal in these transactions because it is responsible for fulfilling the contractual arrangements with the customer and has latitude in establishing prices.
◾ | Warehousing services revenue consist of amounts billed to customers for storage, handling, and value-added packaging of customer merchandise. Storage revenue is recognized in the month the service is provided to the customer. Storage related costs are recognized as incurred. Other Warehousing services revenue and related costs are recognized in proportion to the services performed.
◾ | Supply Chain Management and other services revenue, and related costs are recognized in proportion to the services performed.
​ The Company generally invoices its customers at the commencement of the voyage or the transportation service being provided, or as other services are being performed. Revenue is deferred when services are invoiced in advance to the customer. The Company’s receivables are classified as short-term as collection terms are for periods of less than one year. The Company expenses sales commissions and contract acquisition costs as incurred because the amounts are generally immaterial. These expenses are included in general and administrative expenses in the Condensed Consolidated Statements of Income and Comprehensive Income. ​ Capitalized Interest: The Company capitalizes interest costs during the period as the qualified assets are being readied for their intended use. The Company determined that vessel construction costs are considered qualifying assets for the purposes of capitalizing interest on these assets. The amount of capitalized interest is calculated based on the amount of expenditures incurred related to the construction of these vessels using a weighted average interest rate. The weighted average interest rate is determined using the Company’s average borrowings outstanding during the period. Capitalized interest is included in vessel construction in progress in property and equipment in the Company’s Condensed Consolidated Balance Sheets (see Note 5). During the three months ended March 31, 2025 and 2024, the Company capitalized $1.1 million and $0.8 million, respectively, of interest related to the construction of new vessels. ​ Dividends: The Company’s first quarter 2025 cash dividend of $0.34 per share was paid on March 6, 2025. On April 24, 2025, the Company’s Board of Directors declared a cash dividend of $0.34 per share payable on June 5, 2025 to shareholders of record on May 8, 2025. ​ Repurchase of Shares: During the three months ended March 31, 2025, the Company repurchased approximately 0.5 million shares for a total cost of $69.2 million. As of March 31, 2025, the maximum number of remaining shares that may be repurchased under the Company’s share repurchase program was approximately 3.3 million shares. ​ Reclassification: The Company reclassified amortization of deferred loan fees of $0.4 million from Depreciation and amortization to Other within cash flows from operating activities in the Consolidated Statements of Cash Flows for the three months ended March 31, 2024, to conform to current year cash flow presentation. There were no changes in Net cash provided by operating activities as a result of this reclassification for the three months ended March 31, 2024. ​ New Accounting Pronouncements: In November 2024, the Financial Accounting Standards Board (“FASB”) issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses (“ASU 2024-03”). ASU 2024-03 requires disclosure of certain expenses in the financial statements including employee compensation, depreciation and amortization of intangible assets on an annual and interim basis. ASU 2024-03 is effective for fiscal years beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027. ASU 2024-03 can be adopted either: (i) prospectively to the financial statements issued for reporting periods after the effective date of the ASU or (ii) retrospectively to any or all prior periods presented in the financial statements. The Company is currently evaluating the effects of adopting ASU 2024-03 but does not expect it will have a material impact on the Company’s consolidated financial statements. ​ In December 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures (“ASU 2023-09”). ASU 2023-09 requires disaggregated information about a reporting entity’s effective tax rate reconciliation as well as information on income taxes paid. ASU 2023-09 is effective for annual periods beginning after December 15, 2024, and interim periods within fiscal years beginning after December 15, 2025. The Company is currently evaluating the effects of adopting ASU 2023-09 but does not expect it to have a material impact on the Company’s consolidated financial statements.

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