What changed in this filing

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Item 1. Business

2023-02-24 compared with 2022-02-25 · 94 added, 101 removed, 324 unchanged (38% of the section changed)

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Founded in 1882, MatNav provides a vital lifeline of ocean freight transportation services to the domestic non-contiguous economies of Hawaii, Alaska and Guam, and to other island economies in Micronesia.

MatNav also operates premium, expedited services primarily from China to Long Beach, California, and provides services to Okinawa, Japan and various islands in the South Pacific, and operates an international export service from Dutch Harbor, Alaska to Asia.

In addition, subsidiaries of MatNav provide stevedoring, refrigerated cargo services, inland transportation and other terminal services for MatNav and other ocean carriers on the Hawaiian islands of Oahu, Hawaii, Maui and Kauai, and in the Alaska locations of Anchorage, Kodiak and Dutch Harbor.

MatNav also operates premium, expedited services from China to Long Beach, California, provides services to Okinawa, Japan and various islands in the South Pacific, and operates an international export service from Dutch Harbor, Alaska to Asia.

In addition, subsidiaries of MatNav provide stevedoring, refrigerated cargo services, inland transportation and other terminal services for MatNav on the Hawaiian islands of Oahu, Hawaii, Maui and Kauai, and for MatNav and other ocean carriers in Alaska.

Matson has a 35 percent ownership interest in SSA Terminals, LLC, a joint venture between Matson Ventures, Inc., a wholly-owned subsidiary of MatNav, and SSA Ventures, Inc., a subsidiary of Carrix, Inc.

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Matson provides container transshipment services from many locations in Asia including Hong Kong and Xiamen, China to the United States via the ports of Ningbo and Shanghai, China.

In May 2020, as a result of increased market demand, Matson launched its second expedited service to the U.S.

Matson operates a second expedited service to the U.S.

West Coast with the China-Long Beach Express Plus (“CLX+”) service.

The CLX+ service uses chartered vessels and operates weekly from Ningbo and Shanghai, China where they are loaded with cargo to be discharged primarily at Long Beach, California, calling at an SSAT operated terminal.

In July 2021, Matson launched a temporary, third expedited service to the U.S.

West Coast with the China-California Express (“CCX”) service to meet continued high market demand.

The CCX service uses Matson-owned vessels and departs Shanghai, China every three out of five weeks with direct service to Oakland, California and then to Long Beach, California.

Cargo at both Oakland and Long Beach, California, is discharged at Matson exclusive terminals operated by SSAT.

Matson expects the CCX service to operate through the October peak season of 2022 .

Matson’s expedited China service currently consists of the CLX, CLX+ and the CCX services.

The CLX+ service primarily uses chartered vessels and operates weekly from Ningbo and Shanghai, China where they are loaded with cargo to be discharged primarily at Long Beach, California, calling at an SSAT-operated terminal.

Eastbound cargo from China to Long Beach, California consists mainly of garments, e-commerce related goods, consumer electronics, footwear and other merchandise.

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Matson also provides weekly connecting service from Guam to the Commonwealth of the Northern Mariana Islands.

Cargo destined to these markets is similar to that described under “Hawaii Service” above.

Cargo destined to Guam mainly includes dry containers of mixed commodities, refrigerated containers of food, beverages, retail merchandise, building materials, and household goods.

Japan Service:

Matson’s Japan service provides carriage to the port of Naha in Okinawa, Japan, as part of its CLX service.

This service mainly carries general sustenance cargo and household goods supporting the U.S.

This service mainly carries general sustenance cargo in both dry and refrigerated containers and household goods supporting the U.S.

Micronesia Service:

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West Coast and the islands of Kwajalein, Ebeye and Majuro in the Republic of the Marshall Islands, the islands of Yap, Pohnpei, Chuuk and Kosrae in the Federated States of Micronesia, and the Republic of Palau.

Cargo destined for these locations is transshipped through Guam and consists mainly of general sustenance cargo.

Cargo destined for these locations is transshipped through Guam and consists mainly of general sustenance cargo, building materials, hardware and retail merchandise.

Alaska Service:

Matson’s Alaska service provides ocean carriage between the port of Tacoma, Washington, and the ports of Anchorage, Kodiak and Dutch Harbor, Alaska.

Matson also provides a barge service between Dutch Harbor and

Akutan in Alaska, and transportation services to other locations in Alaska including the Kenai Peninsula, Fairbanks and the North Slope.

Matson also provides a barge service between Dutch Harbor and Akutan in Alaska, and transportation services to other locations in Alaska including the Kenai Peninsula, Fairbanks and the North Slope.

Northbound cargo to Alaska consists mainly of dry containers of mixed commodities, refrigerated commodities, foods and beverages, retail merchandise, household goods and automobiles.

Southbound cargo from Alaska primarily consists of seafood, household goods and automobiles.

In September 2020, Matson launched its Alaska-Asia Express (“AAX”) service that provides carriage of dry and frozen seafood from Dutch Harbor, Alaska to Ningbo and Shanghai, China.

Matson’s Alaska-Asia Express (“AAX”) service provides carriage of dry and frozen seafood from Kodiak and Dutch Harbor, Alaska to many locations in Asia via its transshipment ports of Ningbo and Shanghai, China, and Busan, South Korea.

The AAX service utilizes CLX+ vessels on their westbound trip to China.

Matson also provides transshipment services from Ningbo and Shanghai, China to other locations in Asia.

South Pacific Service:

Matson’s New Zealand Express (“NZX”) service provides carriage of general sustenance cargo between Auckland, New Zealand and select islands in the South Pacific, including Fiji (Suva and Lautoka), Samoa (Apia), American Samoa (Pago Pago), the Cook Islands (Rarotonga and Aitutaki), Tonga (Nukualofa and Vava’u), and Niue.

Matson’s NZX service also provides transshipment services to the islands of Nauru and the Solomon Islands (Honiara).

Additionally, Matson provides slot charter arrangements for the transportation of cargo from major ports on the east coast of Australia to ports in the South Pacific islands.

The NZX service also distributes and sells domestic bulk fuel to a variety of these islands.

Matson’s South Pacific Express (“SPX”) service provides carriage of general sustenance cargo from the U.S.

West Coast to ports in the South Pacific islands using vessel sharing agreements with other carriers.

The SPX service provides direct calls to Tahiti (Papeete), American Samoa (Pago Pago) and Samoa (Apia) in the South Pacific.

Cargo destined for other ports including Tonga (Nukualofa) and the Cook Islands (Rarotonga and Aitutaki) is then transshipped in Apia, Samoa to the NZX service for delivery to its final destination.

Northbound SPX cargo originating in the South Pacific is transshipped from the NZX service with other carriers to the U.S.

Cargo destined for Hawaii or Washington is further transshipped in Oakland, California for delivery to its final destination.

In June 2021, Matson launched its new China-Auckland Express (“CAX”) service that operates from Shanghai, China to Auckland, New Zealand to meet increased demand from China.

The CAX service departs Shanghai every two out of five weeks and transports cargo consisting mainly of garments, e-commerce related goods, consumer electronics, footwear and other merchandise.

Terminal and Other Related Services:

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SSAT currently provides terminal and stevedoring services to various carriers at eight terminal facilities on the U.S.

West Coast, including three facilities dedicated for MatNav’s use, in Long Beach and Oakland, California;

and in Tacoma, Washington.

Matson utilizes the services of other third-party terminal operators at all of the other ports served by its vessels.

West Coast, including three facilities dedicated for MatNav’s use, in Long Beach and Oakland, California and in Tacoma, Washington.

Matson utilizes the services of other third-party terminal operators at all of the other ports where its vessels are served.

Vessel Management Services:

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MATSON HAWAII (6)

NAVIOS FELICITAS (6)(10)

MATSON LANAI (6)

MATSON MAUI (6)

February 2026

MATSON KAUAI (6)

MATSON OAHU (6)

MATSON MOLOKAI (6)

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(1) Twenty-foot Equivalent Units (“TEU”) is a standard measure of cargo volume correlated to a standard 20-foot dry cargo container.

(2) Vessel Design Speed may vary from the operating speed of the vessel.

(2) Actual operating speed of the vessel may vary from the Vessel Design Speed.

(3) Charter expiration date represents the approximate earliest month the vessel can be returned to its owner.

Some vessel charter agreements include options to further extend the charter period.

Some vessel charter agreements include options for the Company to further extend the charter period.

flagged and Jones Act qualified vessel or barge.

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(6) Foreign-flagged vessel.

(7) Flat-deck barge.

(7) Lift-on/lift-off barge equipped with a crane.

(8) Vessel installed with exhaust gas cleaning systems (commonly referred to as “scrubbers”).

(10) Navios Felicitas was returned to its owner in January 2022 and replaced by Matson Maui , which was placed into service in February 2022.

Matson is constructing a new U.S.

flagged and Jones Act qualifying flat-deck barge at a cost of approximately $25.0 million for operation within its Hawaii neighbor island service.

The new barge is expected to be delivered in the first half of 2022.

Fleet Renewal Program:

Matson is constructing three new vessels with the following specifications and expected delivery dates:

Usable Cargo Capacity

Class of Vessel

Delivery Date

Containership

Upon delivery, Matson expects to deploy the three new vessels in the CLX service and redeploy three existing CLX vessels into the Alaska service.

The new vessels will have dual-fuel engines and be equipped with tanks, piping and cryogenic equipment designed to operate on liquified natural gas (“LNG”) and conventional fuels.

The new vessels are also being designed with state-of-the-art green technology features and fuel-efficient hulls.

Each new vessel is expected to provide 500 containers of additional capacity per voyage in the CLX service.

The contract cost of the new vessel program is approximately $1.0 billion in total, and milestone payments are expected to be financed with cash currently on deposit in the Company’s Capital Construction Fund, cash and cash equivalents on the consolidated balance sheet and through cash flows generated from future operations, borrowings available under the Company’s unsecured revolving credit facility or additional debt financings .

Actual and future annual vessel construction progress milestone payments based on signed agreements and change orders, excluding owners’ items and capitalized interest, are expected to be as follows:

Future Milestone Payments

Vessel Construction Obligations (in millions)

Three Aloha Class Containerships

Matson is also installing tanks, piping and cryogenic equipment on existing Aloha Class vessels so that they can operate on LNG and conventional fuels.

The LNG installation project on Daniel K.

Inouye has begun and work on Kaimana Hila is currently scheduled to begin during the second quarter of 2024.

Each installation is expected to cost approximately $35 million.

Additionally, the Company plans to begin reengining Manukai to operate on LNG and conventional fuels during the second quarter of 2023 at a total cost of approximately $60 million.

The three new Aloha Class vessels and LNG installation projects are important steps towards achieving Matson’s medium-term greenhouse gas (“GHG”) emissions goal which is to reduce Scope 1 GHG emissions from our owned fleet by 40% by 2030, using 2016 as a baseline year.

Matson has also set a long-term goal to achieve net zero Scope 1 GHG emissions from our owned fleet by 2050.

For more information on Matson’s environmental stewardship initiatives, including GHG reduction goals, see Matson’s Sustainability Report and other information available at https://www.matson.com/sustainability.

Vessel Emission Regulations:

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Matson’s vessels transit through some of the most environmentally sensitive areas in the United States including the Hawaiian Islands and the coasts of California, Oregon, Washington and Alaska.

Matson is focused in particular on reducing transportation emissions, including carbon dioxide, nitrous oxide, particulate matter and sulfur dioxide through improvements in vessel fuel consumption, choice of fuel types and the development of more fuel-efficient transportation solutions.

In particular, Matson is focused on reducing transportation emissions, including carbon dioxide, methane, nitrous oxide, particulate matter and sulfur dioxide through improvements in vessel fuel consumption, choice of fuel types and the development of more fuel-efficient transportation solutions.

Matson further contributes positively to the environment by testing and deploying leading technologies as the fleet is modernized.

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and over 100 other countries are signatories, is a specialized agency of the United Nations that sets international environmental standards applicable to vessels operating under the flag of any signatory country.

Effective January 1, 2020, the IMO imposed regulations that generally require all vessels to burn fuel oil with a maximum sulfur content of ≤0.5 percent (“IMO 2020”).

There are three main options for a vessel to meet the IMO 2020 requirements:

(1) burn low sulfur fuel oil (“LSFO”), (2) install exhaust gas cleaning systems (commonly referred to as “scrubbers”) on vessels to reduce sulfur emissions from heavy fuel oil (“HFO”), or (3) switch to lower emission fuels such as liquefied natural gas (“LNG”), which requires converting existing vessels or constructing new vessels with LNG-capable engines and fuel tanks.

Effective January 1, 2020, the IMO imposed regulations that generally require all vessels to burn fuel oil with a maximum sulfur content of ≤0.5 percent.

With respect to North America, all waters, with certain limited exceptions, within 200 nautical miles of U.S.

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Since January 1, 2015, U.S.

Environmental Protection Agency regulations have reduced the fuel oil maximum sulfur content in designated ECAs to ≤0.1 percent or the equivalent emissions by the use of scrubbers.

In addition, since August 1, 2012, the California Air Resource Board and U.S.

Environmental Protection Agency under the Vessel General Permit regulations have reduced the fuel oil maximum sulfur content to ≤0.1 percent within 24 miles of the California coastline and within Puget Sound.

All of Matson’s vessels in the Alaska and Hawaii services are designed to operate in compliance with IMO 2020 and ECA regulations as applicable, and can use LSFO.

In the Alaska and Hawaii services, Matson installed scrubbers on ten diesel engine-powered vessels to allow them to use HFO and still comply with IMO 2020 and ECA regulations.

Environmental Protection Agency regulations have

reduced the fuel oil maximum sulfur content in designated ECAs.

In addition, since August 1, 2012, the California Air Resource Board has reduced the fuel oil maximum sulfur content to ≤0.1 percent within 24 miles of the California coastline.

All of Matson’s vessels are designed to operate in compliance with IMO and ECA regulations as applicable.

Matson also maintains vessels which may operate as dry-dock relief or for emergency activation purposes under an EPA approved ECA permit enabling the use of fuel oil with a maximum sulfur content of ≤0.5 percent within the North America ECA or at any time on IMO compliant fuels.

Matson’s Aloha and Kanaloa Class vessels burn compliant LSFO.

These vessels are also equipped with dual-fuel engines and can be converted to run on LNG.

All of Matson’s other vessels use LSFO to meet IMO 2020 and ECA emission standards.

In June 2021, the IMO adopted new greenhouse gas (“GHG”) emission requirements applicable to ships.

Beginning with a company’s first annual, intermediate or renewal survey for an international air pollution prevention certificate on or after January 1, 2023, all containerships with more than 10,000 dead weight tons will be required to meet specified Energy Efficiency Existing Ship Index (“EEXI”) levels.

In June 2021, the IMO adopted new GHG emission requirements applicable to ships.

Beginning with a company’s first annual, intermediate or renewal survey for an International Air Pollution Prevention (“IAPP”) certificate on or after January 1, 2023, all containerships with more than 10,000 dead weight tons will be required to meet specified Energy Efficiency Existing Ship Index (“EEXI”) levels.

EEXI is a one-time certification measuring a ship’s theoretical carbon dioxide (CO 2 ) emissions per transport work based on its design parameters.

After 2023, containerships with over 5,000 gross tonnage (“GT”) will be required to meet annual Carbon Intensity Indicator (“CII”) requirements that become increasingly stringent towards 2030.

Beginning in 2023, containerships with over 5,000 gross tonnage (“GT”) will be required to meet annual Carbon Intensity Indicator (“CII”) requirements that become increasingly stringent towards 2030.

CII measures how efficiently a ship transports goods, and uses actual CO 2 emissions to determine an annual rating from A to E.

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For a discussion on the Company’s planned future capital expenditures to comply with these regulations, see Part II, Item 7 of this Form 10-K.

For more information on Matson’s environmental stewardship initiatives, including GHG emission reduction goals, see Matson’s Sustainability Report and other information available at www.matson.com/sustainability.

Hawaii Terminal Modernization and Expansion Program:

During 2020, Matson completed the first phase of its program to modernize and renovate its terminal facility at Sand Island, Honolulu, Hawaii.

As part of this phase, Matson completed the installation of three new 65 long- ton capacity gantry cranes, upgraded and renovated three existing cranes, demolished four outdated cranes, and installed upgrades to the electrical infrastructure at the terminal.

During 2021, as part of the second phase, Matson completed the installation, energization and transition to a new redundant main switchgear.

Additional projects for this phase relate to improvements to its existing backup power

generators, installation of new above ground fuel storage tanks, a battery energy storage system, and other upgrades at the terminal, and are expected to be completed within the next three years.

The next phase represents a broader and long-term terminal expansion program at the Sand Island terminal facility.

Matson completed the first phase of its program to modernize and renovate its terminal facility at Sand Island, Honolulu, and is progressing on the second phase.

As part of this program, Matson completed the installation of three new 65 long- ton capacity gantry cranes, upgraded and renovated three existing cranes, demolished four outdated cranes, and installed upgrades to the electrical infrastructure at the terminal.

In addition, Matson completed the installation, energization and transition to a new redundant main switchgear.

Additional projects for the second phase relate to improvements to its existing backup power generators, installation of new above ground fuel storage tanks, a battery energy storage system, and other upgrades at the terminal, and are expected to be completed within the next three years.

The third phase represents a broader and long-term terminal expansion program at the Sand Island terminal facility.

Matson expects to expand into Pier 51A and portions of Pier 51B after Pasha Hawaii (“Pasha”) relocates to the newly constructed Kapalama container terminal facility planned for 2024.

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and other vessel operating related expenses.

Matson purchases fuel oil, lubricants and gasoline for its operations and also pays fuel-related surcharges to other third party transportation providers.

Matson purchases fuel oil, lubricants and gasoline for its operations and pays fuel-related surcharges to other third-party transportation providers.

Operating Overhead includes equipment repair costs, equipment lease and repositioning expenses, vessel repair and maintenance costs, depreciation and dry-docking amortization, insurance, port engineers and other maintenance costs, and other vessel and shoreside related overhead.

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flagged Jones Act competitor, Pasha, which operates container and roll-on/roll-off services between the ports of Long Beach, Oakland and San Diego, California to Hawaii.

flagged Jones Act barge operator, Aloha Marine Lines, also offers barge service between the Pacific Northwest and Hawaii.

flagged Jones Act barge operator, Aloha Marine Lines, also offers barge service between Seattle, Washington and Hawaii.

Foreign-flagged vessels carrying cargo to Hawaii from non-U.S.

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These strings provide customers an industry-leading five departures from ports on the U.S.

West Coast to Hawaii every week – two each from Long Beach and Oakland, California and one from Tacoma, Washington.

West Coast – two each from Long Beach and Oakland, California and one from Tacoma, Washington, with three arrivals in Honolulu each week.

Each of these strings operates on a fixed day-of-the-week schedule.

Two of the vessel strings continue from Honolulu to China before returning to Long Beach.

One of the vessel strings continues from Honolulu to China before returning to Long Beach.

Matson’s frequent sailings and punctuality permit customers to reduce inventory carrying costs.

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There are also two U.S.

flagged Jones Act barge operators, Alaska Marine Lines, which mainly provides services from Seattle, Washington to the ports of Anchorage and Dutch Harbor, and other locations in Alaska, and Samson Tug & Barge,

which mainly serves Western Alaska and other locations.

flagged Jones Act barge operators, Alaska Marine Lines, which mainly provides services from Seattle, Washington to the ports of Anchorage, Dutch Harbor, and other locations in Alaska, and Samson Tug & Barge, which mainly serves Western Alaska and other locations.

The barge operators have historically shipped lower value commodities that can accommodate a longer transit time, as well as construction materials and other cargo that are not conducive to movement in containers.

Foreign-flagged vessels provide alternatives for companies shipping cargo (mainly seafood) from the Alaska ports of Kodiak and Dutch Harbor.

Other competition includes air freight and over-the-road trucking services.

Foreign-flagged vessels provide alternatives for companies shipping cargo (mainly seafood) from the Alaska ports of Kodiak and Dutch Harbor to international destinations.

Other competition includes air freight carriers and over-the-road trucking services.

Matson’s AAX service has two major competitors, CMA CGM and Maersk Lines, which provide services between Dutch Harbor, Alaska and Asia.

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Matson offers dedicated terminal services at the Alaska ports of Anchorage, Kodiak and Dutch Harbor performed by Matson, and at the port of Tacoma, Washington performed by SSAT.

Matson’s AAX service also offers customers a service from Dutch Harbor, Alaska to Ningbo and Shanghai, China, with transshipment services from those ports to other locations in Asia.

Matson’s AAX service also offers customers a service from Kodiak and Dutch Harbor, Alaska to Ningbo and Shanghai, China, and Busan, South Korea, with transshipment services from those ports to other locations in Asia.

China Service:

Major competitors to Matson’s China service include large international carriers such as CMA CGM, OOCL, ZIM, Evergreen and Maersk.

Major competitors to Matson’s China service include large international transpacific carriers such as CMA CGM, OOCL, ZIM, Evergreen and Maersk.

Other competition includes air freight carriers.

Matson’s China service competes by offering fast and reliable service from the ports of Ningbo and Shanghai in China, and feeder services from other Asian ports of origin, to Long Beach and Oakland, California.

Matson’s China service (CLX and CLX+) competes by offering fast and reliable service from the ports of Ningbo and Shanghai in China, and feeder services from other Asian ports of origin, to Long Beach and Oakland, California.

Matson provides fixed day-of-the-week arrivals and industry leading cargo availability.

Matson’s service is further differentiated by best-in-class stevedoring services provided by SSAT, Matson dedicated terminal space, access to Shippers Transport Express off-dock container yards for faster truck turn times, Matson-dedicated equipment including chassis to speed cargo availability, one-stop intermodal connections, and world-class customer service.

Matson also provides intermodal services in coordination with Matson Logistics.

provides intermodal services in coordination with Matson Logistics.

Matson has offices located in Shanghai, Shenzhen, Xiamen, Ningbo and Hong Kong, and has contracted with terminal operators in Ningbo and Shanghai.

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Matson’s Guam service has one major competitor, APL, a U.S.

flagged subsidiary of CMA CGM, which operates a weekly U.S.

flagged container feeder service connecting the U.S.

flagged subsidiary of CMA CGM, which operates a U.S.

flagged container service connecting the U.S.

West Coast to Guam and Saipan, via transshipments to U.S.

flagged feeder vessels in Yokohama, Japan and Busan, South Korea.

Waterman operates a roll-on/roll-off service, which periodically calls at Guam.

There are also several foreign carriers, including CMA CGM, that call at Guam from foreign origin ports.

flagged feeder vessels in Yokohama, Japan and Busan, South Korea via a two-ship feeder service.

There are also other several foreign carriers that call at Guam from foreign origin ports, and air freight carriers.

Matson offers customers a weekly service to Guam as part of the CLX service from three ports on the U.S.

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Japan Service:

Matson’s Japan service has one major competitor, APL, which operates a weekly U.S.

Matson’s Japan service has one major competitor, APL, which operates a U.S.

flagged containership service from the U.S.

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Freight rates are impacted mainly by macro supply and demand variables.

Since 2020, Matson’s typical seasonal trends have been impacted by the global pandemic which has resulted in elevated levels of demand experienced in our Ocean Transportation services.

Matson’s expanded services in China and other locations have resulted in significant increases in volume during the second half of 2020 and throughout 2021.

Supply chain congestion and elevated levels of demand are expected to impact the Company’s Ocean Transportation services during 2022.

Matson’s typical seasonal trends have been impacted by the global pandemic which resulted in elevated levels of demand experienced in our Ocean Transportation services during the second half of 2020 throughout 2021 and in the first half of 2022.

Weakening economic conditions in the U.S., relatively high inflation and the impact of higher interest rates on household discretionary income may affect the demand for consumer goods in our markets, which could impact seasonal variability and demand for the Company’s Ocean Transportation services in 2023.

Maritime Laws and the Jones Act :

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Coast Guard, which requires appropriate certifications and background checks of the crew members.

Under Section 27 of the Jones Act, the carriage of cargo between the U.S.

Under Section 27 of the Jones

Act, the carriage of cargo between the U.S.

West Coast, Hawaii and Alaska on foreign-built or foreign-documented vessels is prohibited.

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In addition to the vessel emission regulations discussed above, Matson’s operations are required to comply with other environmental regulations and requirements including the Oil Pollution Act of 1990, the Comprehensive Environmental Response Compensation & Liability Act of 1980, the Rivers and Harbors Act of 1899, the Clean Water Act, the Invasive Species Act and the Clean Air Act.

Matson is also subject to state regulations affecting terminal and vessel emissions, such as the requirement to shut down vessel generator engines while at berth at California ports and switch to shore electrical power.

The Company actively monitors its operations for compliance with these and other regulations.

For more information on Matson’s environmental stewardship initiatives, including its environmental goals, see Matson’s Sustainability Report and other information available at www.matson.com/sustainability.

LOGISTICS SEGMENT

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Supply Chain Management and Other Services:

Matson Logistics provides customers with a variety of logistics services including purchase order management, customs brokerage, LCL and full container load NVOCC freight forwarding services.

Matson Logistics provides customers with a variety of logistics services including purchase order management, booking services, customs brokerage, LCL and full container load NVOCC freight forwarding services.

Matson Logistics has supply chain operations in North America, China and other locations.

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Matson Logistics’ transportation brokerage services compete most directly with C.H.

Robinson Worldwide, Hub Group, XPO and other freight brokers and intermodal marketing companies, and asset-invested market leaders such as J.B.

Robinson Worldwide, Hub Group, RXO and other freight brokers and intermodal marketing companies, and asset-invested market leaders such as J.B.

Competition is differentiated by the depth, scale and scope of customer relationships;

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In general, Matson Logistics’ services are not significantly impacted by seasonality factors, with the exception of its freight forwarding service to Alaska which may be affected by winter weather and the seasonal nature of the tourism industry.

However, Matson’s Logistics businesses are being impacted by the global pandemic which has resulted in elevated levels of demand for our Logistics services that is expected to continue during 2022.

However, the weakening economic conditions in the U.S., relatively high inflation and the impact of higher interest rates on household discretionary income may affect the demand for consumer goods, which could impact Matson’s Logistics businesses in 2023.

EMPLOYEES AND LABOR RELATIONS

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government vessels.

Diversity, Equity and Inclusion:

Diversity, Equity and Inclusion (DE&I):

For many years, Matson has been committed to improving diversity, providing equal pay for equal work and creating an inclusive culture.

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This includes continuing its efforts to analyze pay among various employee groups to confirm pay equity across the Company.

Externally, the Company supports programs intended to help build a diverse talent pool for Matson and its industry.

In 2020, the Company committed $100,000 toward creation of new Matson scholarships to be offered in conjunction with 16 higher education institutions and maritime academies in its communities with the goal of increasing diversity among those pursuing studies in transportation and logistics.

The first scholarships were granted in Fall 2021.

Separately, the Company committed more than $200,000 to fund paid internships with the goal of providing professional work experience opportunities and promoting the Company and the industry to a diverse group of students in its various regional locations.

The first internships under this program are anticipated for Summer 2022.

As part of its overall DE&I strategy, Matson continues to focus on developing and promoting diverse individuals into leadership positions.

The Company utilizes both internal and external learning and development programs to encourage and promote career opportunities within our diverse employee groups.

In 2022, approximately two-thirds of Matson promotions in management roles were women and/or minority individuals.

Matson is also focused on supporting a more diverse talent pool over the long-term by encouraging women and minorities to pursue careers in the maritime and logistics sectors.

To this end, in 2022 the Company established and awarded sixteen scholarships to diverse, high-achieving students at higher education institutions and maritime academies.

Matson has also worked to enhance employees’ understanding and perspective on working with diverse groups of individuals.

In 2022, the Company provided two DE&I trainings to deepen employees’ understanding and appreciation for ways to improve interactions with others and promote more inclusive relationships.

One training focused on ways people communicate that reinforce stereotypes and perpetuate discrimination, often unintentionally, called “microaggressions.” The other DE&I training provided a broad overview of general diversity, equity and inclusion principles – the “dos and don’ts” of respectful social interaction.

These trainings were completed by more than 1,100 employees during the past year.

The composition of Matson’s domestic shoreside workforce by gender and race in 2022 is as follows (data for seagoing personnel is not available to the Company):

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In 2022, 44 percent of open positions were filled through internal promotions.

The Company also provided approximately 3,200 hours of employee training and development, while giving annual performance reviews to its non-union workforce.

The Company also provided approximately 3,500 hours of employee training and professional development opportunities, and tuition reimbursement programs, while giving annual performance reviews to its non-union workforce.

For more information on Matson’s human capital programs, see our Sustainability Report which is available at www.matson.com/sustainability .

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Matson has collective bargaining agreements with these unions that expire at various dates in the future, including as early as 2023.

While Matson believes that it will be able to renegotiate these collective bargaining agreements with its various unions as they expire without any significant impact on its operations, no assurance can be given that such agreements will be reached without slow-downs, strikes, lockouts or other disruptions that may adversely impact Matson’s operations.

Additionally, Matson and SSAT are members of the Pacific Maritime Association (“PMA”), which on behalf of its members negotiates collective bargaining agreements with the International Longshore and Warehouse Union (“ILWU”) on the U.S.

Matson and SSAT are also members of the Pacific Maritime Association (“PMA”), which on behalf of its members negotiates collective bargaining agreements with the International Longshore and Warehouse Union (“ILWU”) on the U.S.

The PMA/ILWU collective bargaining agreements cover substantially all U.S.

West Coast longshore labor.

In August 2017, the ILWU agreed to extend its contract with the PMA to July 1, 2022.

The Company believes that the renegotiation of this contract will be completed during 2022.

The ILWU collective bargaining agreement with the PMA expired on July 1, 2022.

While Matson believes that it will be able to renegotiate these collective bargaining agreements as they expire without any significant impact on its operations, including the PMA/ILWU collective bargaining agreement, no assurance can be given that such agreements will be reached on a timely basis or at all without slow-downs, strikes, lockouts or other disruptions that may adversely impact Matson’s operations.

Multi-employer Pension and Post-retirement Plans:

Matson contributes to a number of multi-employer pension and post-retirement plans.

Matson contributes to several multi-employer pension and post-retirement plans.

Matson has no present intention of withdrawing from and does not anticipate the termination of any of the multi-employer pension plans to which it contributes (see Notes 11 and 12 to the Consolidated Financial Statements in Item 8 of Part II below for a discussion of withdrawal liabilities under certain multi-employer pension plans).

3 unchanged sentences

The address of Matson’s Internet website is www.matson.com.

This website is provided for convenience only, and the contents of our website do not constitute a part of and are not incorporated by reference into this Form 10-K.

This website and other websites included in this document are provided for convenience only, and the contents of such websites do not constitute a part of and are not incorporated by reference into this Form 10-K.

The SEC maintains an Internet website that contains reports, proxy and information statements, and other information regarding Matson and other issuers that file electronically with the SEC.

1 unchanged sentence

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business