Matson, Inc. 10-K

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA ​ ​ ​ ​ ​ Page Management’s Annual Report on Internal Control Over Financial Reporting ‌ 42 Report of Independent Registered Public Accounting Firm (PCAOB ID No. 34) ‌ 43 Consolidated Statements of Income and Comprehensive Income ‌ 45 Consolidated Balance Sheets ‌ 46 Consolidated Statements of Cash Flows ‌ 47 Consolidated Statements of Shareholders’ Equity ‌ 48 ​ ​ Notes to Consolidated Financial Statements ‌ 49 1. Description of the Business ‌ 49 2. Significant Accounting Policies ‌ 49 3. Reportable Segments ‌ 55 4. Investment in SSAT ‌ 56 5. Property and Equipment ‌ 58 6. Goodwill and Intangible Assets ‌ 58 7. Capital Construction Fund ‌ 59 8. Debt ‌ 61 9. Leases ‌ 63 10. Income Taxes ‌ 64 11. Pension and Post-Retirement Plans ‌ 66 12. Multi-Employer Withdrawal Liabilities ‌ 73 13. Accumulated Other Comprehensive Income (Loss) ‌ 73 14. Earnings Per Share ‌ 74 15. Share-Based Awards ‌ 74 16. Fair Value of Financial Instruments ‌ 75 17. Commitments and Contingencies ‌ 76 ​ ​ 41 Table of Contents MANAGEMENT’S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING ​ The management of Matson, Inc. and subsidiaries (the “Company”) has the responsibility for establishing and maintaining adequate internal control over financial reporting. Internal control over financial reporting is defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934, as a process designed by, or under the supervision of, the Company’s principal executive and principal financial officers and effected by the Company’s Board of Directors, management and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America and includes those policies and procedures that: ​ ● Pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of assets of the company; ​ ● Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and ​ ● Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the company’s assets that could have a material effect on the financial statements. ​ Because of its inherent limitations, internal control over financial reporting only provides reasonable assurance with respect to financial statement presentation and preparation. Projections of any evaluation of effectiveness to future periods are subject to the risks that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. ​ Management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2024. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control-Integrated Framework (2013) . Based on its assessment, management believes that, as of December 31, 2024, the Company’s internal control over financial reporting is effective. The Company’s independent registered public accounting firm , Deloitte & Touche LLP , has issued an attestation report on the Company’s internal control over financial reporting. ​ ​ /s/ Matthew J. Cox ​ /s/ Joel M. Wine Matthew J. Cox ​ Joel M. Wine Chairman and Chief Executive Officer ​ Executive Vice President and Chief Financial Officer February 28, 2025 ​ February 28, 2025 ​ ​ ​ 42 Table of Contents REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM ​ To the Board of Directors and the shareholders of Matson, Inc. ​ Opinions on the Financial Statements and Internal Control over Financial Reporting We have audited the accompanying consolidated balance sheets of Matson, Inc. and subsidiaries (the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of income and comprehensive income, shareholders’ equity, and cash flows, for each of the three years in the period ended December 31, 2024, and the related notes (collectively referred to as the “financial statements”). We also have audited the Company’s internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ​ In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 2024 and 2023, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2024, based on criteria established in Internal Control — Integrated Framework (2013) issued by COSO. ​ Basis for Opinions The Company’s management is responsible for these financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on these financial statements and an opinion on the Company’s internal control over financial reporting based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. ​ We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud, and whether effective internal control over financial reporting was maintained in all material respects. ​ Our audits of the financial statements included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures to respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions. ​ Definition and Limitations of Internal Control over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. ​ Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. ​ Critical Audit Matter The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that 43 Table of Contents are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. ​ Goodwill – Span Alaska Reporting Unit — Refer to Notes 2 and 6 to the financial statements ​ Critical Audit Matter Description ​ The Company’s evaluation of goodwill for impairment involves the comparison of the fair value of each reporting unit to its carrying value. In estimating the fair value of a reporting unit, the Company uses a combination of a discounted cash flow model and fair value based on market multiples of earnings before interest, taxes, depreciation and amortization (“EBITDA”). The discounted cash flow approach requires the Company to make several business and valuation assumptions, including, but not limited to, those related to the discount rate. Changes in assumptions and estimates could have a material effect on either the fair value, the amount of any goodwill impairment charge, or both. The goodwill balance was $327.8 million as of December 31, 2024, of which $78.6 million is allocated to the Span Alaska reporting unit in the Logistics reportable segment, resulting from the acquisition of Span Intermediate, LLC (“Span Alaska”) in fiscal year 2016. The Company has evaluated its goodwill for impairment as part of its annual assessment in fiscal year 2024 and determined that the fair value of the Span Alaska reporting unit exceeded the carrying amount as of the date of the impairment review. ​ We identified goodwill related to Span Alaska as a critical audit matter because of the significant estimates and assumptions management made to estimate the fair value of Span Alaska. Specifically, performing audit procedures to evaluate the reasonableness of management’s estimates and assumptions related to the selection of the discount rate required a high degree of auditor judgment and an increased extent of effort, including the need to involve our fair value specialists. ​ How the Critical Audit Matter Was Addressed in the Audit ​ Our audit procedures related to the selection of the discount rate for Span Alaska included the following, among others: ​ ● We tested the effectiveness of controls over management’s goodwill impairment evaluation, including those over the selection of the discount rate. ● With the assistance of our fair value specialists, we evaluated the reasonableness of the discount rate, including testing the source information underlying the determination of the discount rate, testing the mathematical accuracy of the calculation, and developing a range of independent estimates and comparing those to the discount rate selected by management. ​ ​ /s/ Deloitte & Touche LLP ​ Honolulu, Hawaii ​ February 28, 2025 ​ ​ ​ We have served as the Company’s auditor since at least 1976; however, an earlier year could not be reliably determined. ​ ​ ​ ​ 44 Table of Contents MATSON, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, (In millions, except per share amounts) 2024 2023 2022 Operating Revenue: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ocean Transportation ​ $ 2,809.7 ​ $ 2,477.0 ​ $ 3,544.6 ​ Logistics ​ 612.1 ​ 617.6 ​ 798.4 ​ Total Operating Revenue ​ 3,421.8 ​ 3,094.6 ​ 4,343.0 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Costs and Expenses: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating costs ​ ( 2,565.9 ) ​ ( 2,470.7 ) ​ ( 2,811.5 ) ​ (Loss) Income from SSAT ​ ( 1.0 ) ​ 2.2 ​ 83.1 ​ General and administrative ​ ( 303.6 ) ​ ( 283.3 ) ​ ( 261.0 ) ​ Total Costs and Expenses ​ ( 2,870.5 ) ​ ( 2,751.8 ) ​ ( 2,989.4 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating Income ​ 551.3 ​ 342.8 ​ 1,353.6 ​ Interest income ​ ​ 48.3 ​ ​ 36.0 ​ ​ 8.2 ​ Interest expense ​ ( 7.5 ) ​ ( 12.2 ) ​ ( 18.0 ) ​ Other income (expense), net ​ 7.3 ​ 6.4 ​ ​ 8.5 ​ Income before Taxes ​ 599.4 ​ 373.0 ​ 1,352.3 ​ Income taxes ​ ( 123.0 ) ​ ( 75.9 ) ​ ( 288.4 ) ​ Net Income ​ $ 476.4 ​ $ 297.1 ​ $ 1,063.9 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other Comprehensive Income (Loss), Net of Income Taxes: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net Income ​ $ 476.4 ​ $ 297.1 ​ $ 1,063.9 ​ Other Comprehensive Income (Loss): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net change in pension and post-retirement liabilities ​ ​ 3.2 ​ ​ ( 2.5 ) ​ ​ 23.8 ​ Other adjustments ​ ( 1.5 ) ​ 1.2 ​ 0.2 ​ Total Other Comprehensive Income (Loss), Net of Income Taxes ​ 1.7 ​ ( 1.3 ) ​ 24.0 ​ Comprehensive Income ​ $ 478.1 ​ $ 295.8 ​ $ 1,087.9 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic Earnings Per Share ​ $ 14.14 ​ $ 8.42 ​ $ 27.28 ​ Diluted Earnings Per Share ​ $ 13.93 ​ $ 8.32 ​ $ 27.07 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Weighted Average Number of Shares Outstanding: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Basic ​ 33.7 ​ 35.3 ​ 39.0 ​ Diluted ​ 34.2 ​ 35.7 ​ 39.3 ​ ​ See Notes to Consolidated Financial Statements. ​ 45 Table of Contents MATSON, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, (In millions) 2024 2023 ASSETS ​ ​ ​ ​ ​ ​ ​ Current Assets: ​ ​ ​ ​ ​ ​ ​ Cash and cash equivalents ​ $ 266.8 ​ $ 134.0 ​ Accounts receivable, net of allowance for credit losses of $ 9.8 million and $ 9.9 million, respectively ​ 268.9 ​ 279.4 ​ Prepaid expenses and other assets ​ 73.9 ​ 188.9 ​ Total current assets ​ 609.6 ​ 602.3 ​ Long-term Assets: ​ ​ ​ ​ ​ ​ ​ Investment in SSAT ​ 84.1 ​ 85.5 ​ Property and equipment, net ​ 2,260.9 ​ 2,089.9 ​ Operating lease right of use assets ​ ​ 357.7 ​ ​ 289.6 ​ Goodwill ​ 327.8 ​ 327.8 ​ Intangible assets, net ​ ​ 159.4 ​ ​ 176.4 ​ Capital Construction Fund ​ ​ 642.6 ​ ​ 599.4 ​ Deferred dry-docking costs, net ​ ​ 73.7 ​ ​ 57.3 ​ Other long-term assets ​ 79.6 ​ 66.4 ​ Total long-term assets ​ ​ 3,985.8 ​ ​ 3,692.3 ​ Total Assets ​ $ 4,595.4 ​ $ 4,294.6 ​ ​ ​ ​ ​ ​ ​ ​ ​ LIABILITIES AND SHAREHOLDERS’ EQUITY ​ ​ ​ ​ ​ ​ ​ Current Liabilities: ​ ​ ​ ​ ​ ​ ​ Current portion of debt ​ $ 39.7 ​ $ 39.7 ​ Accounts payable and accruals ​ 268.5 ​ 277.9 ​ Operating lease liabilities ​ ​ 129.0 ​ ​ 136.7 ​ Other liabilities ​ 123.2 ​ 108.0 ​ Total current liabilities ​ 560.4 ​ 562.3 ​ Long-term Liabilities: ​ ​ ​ ​ ​ ​ ​ Long-term debt, net of deferred loan fees ​ 350.8 ​ 389.3 ​ Long-term operating lease liabilities ​ ​ 229.5 ​ ​ 159.3 ​ Deferred income taxes ​ 693.4 ​ 669.3 ​ Other long-term liabilities ​ ​ 109.3 ​ ​ 113.7 ​ Total long-term liabilities ​ 1,383.0 ​ 1,331.6 ​ Commitments and Contingencies (see Note 17) ​ ​ ​ ​ ​ ​ ​ Shareholders’ Equity: ​ ​ ​ ​ ​ ​ ​ Common stock - common stock without par value; authorized, 150 million shares ($ 0.75 stated value per share): outstanding, 33.0 million shares in 2024 and 34.4 million shares in 2023 ​ 24.7 ​ 25.8 ​ Additional paid in capital ​ 296.7 ​ 293.4 ​ Accumulated other comprehensive loss, net ​ ( 6.5 ) ​ ( 8.2 ) ​ Retained earnings ​ 2,337.1 ​ 2,089.7 ​ Total shareholders’ equity ​ 2,652.0 ​ 2,400.7 ​ Total Liabilities and Shareholders’ Equity ​ $ 4,595.4 ​ $ 4,294.6 ​ ​ See Notes to Consolidated Financial Statements. ​ 46 Table of Contents MATSON, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, (In millions) 2024 2023 2022 Cash Flows From Operating Activities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net income ​ $ 476.4 ​ $ 297.1 ​ $ 1,063.9 ​ Reconciling adjustments: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Depreciation and amortization ​ 153.1 ​ 142.2 ​ 139.2 ​ Amortization of operating lease right of use assets ​ ​ 133.7 ​ ​ 142.0 ​ ​ 153.0 ​ Deferred income taxes ​ 20.9 ​ 19.6 ​ 90.2 ​ (Gain) Loss on disposal of property and equipment ​ ( 2.3 ) ​ 0.6 ​ ( 1.5 ) ​ Share-based compensation expense ​ 26.5 ​ 23.8 ​ 18.3 ​ Loss (Income) from SSAT ​ 1.0 ​ ( 2.2 ) ​ ( 83.1 ) ​ Distributions from SSAT ​ 14.0 ​ — ​ 47.3 ​ Other ​ ​ ( 10.3 ) ​ ​ ( 0.5 ) ​ ​ 2.1 ​ Changes in assets and liabilities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accounts receivable, net ​ 9.8 ​ ( 10.9 ) ​ 74.6 ​ Deferred dry-docking payments ​ ( 30.2 ) ​ ( 24.1 ) ​ ( 25.7 ) ​ Deferred dry-docking amortization ​ 27.2 ​ 25.3 ​ 24.9 ​ Prepaid expenses and other assets ​ 94.8 ​ 33.5 ​ ( 45.2 ) ​ Accounts payable, accruals and other liabilities ​ ( 5.6 ) ​ 10.9 ​ ( 31.7 ) ​ Operating lease assets and liabilities, net ​ ​ ( 139.5 ) ​ ​ ( 144.8 ) ​ ​ ( 154.1 ) ​ Other long-term liabilities ​ ( 1.7 ) ​ ( 2.0 ) ​ ( 0.3 ) ​ Net cash provided by operating activities ​ 767.8 ​ 510.5 ​ 1,271.9 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Investing Activities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Capitalized vessel construction expenditures ​ ​ ( 95.6 ) ​ ​ ( 52.9 ) ​ ​ ( 62.4 ) ​ Capital expenditures (excluding vessel construction expenditures) ​ ( 214.5 ) ​ ( 195.5 ) ​ ( 146.9 ) ​ Proceeds from disposal of property and equipment, net ​ 5.9 ​ 1.2 ​ 1.2 ​ Payments for asset acquisitions ​ ​ ( 0.8 ) ​ ​ ( 12.4 ) ​ ​ ( 3.0 ) ​ Cash and interest deposits into Capital Construction Fund ​ ( 120.7 ) ​ ( 128.5 ) ​ ( 582.8 ) ​ Withdrawals from Capital Construction Fund ​ 89.6 ​ 49.9 ​ 64.6 ​ Net cash used in investing activities ​ ( 336.1 ) ​ ( 338.2 ) ​ ( 729.3 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash Flows From Financing Activities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Repayments of debt ​ ​ ( 39.7 ) ​ ( 76.9 ) ​ ( 111.5 ) ​ Dividends paid ​ ​ ( 44.8 ) ​ ( 45.0 ) ​ ( 48.0 ) ​ Repurchase of Matson common stock ​ ​ ( 199.1 ) ​ ​ ( 155.2 ) ​ ​ ( 397.0 ) ​ Tax withholding related to net share settlements of restricted stock units ​ ​ ( 17.6 ) ​ ​ ( 12.6 ) ​ ​ ( 20.1 ) ​ Net cash used in financing activities ​ ( 301.2 ) ​ ( 289.7 ) ​ ( 576.6 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash ​ 130.5 ​ ( 117.4 ) ​ ( 34.0 ) ​ Cash, Cash Equivalents and Restricted Cash, Beginning of the Year ​ 136.3 ​ 253.7 ​ 287.7 ​ Cash, Cash Equivalents and Restricted Cash, End of the Year ​ $ 266.8 ​ $ 136.3 ​ $ 253.7 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Reconciliation of Cash, Cash Equivalents, and Restricted Cash, at End of the Year: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Cash and Cash Equivalents ​ $ 266.8 ​ $ 134.0 ​ $ 249.8 ​ Restricted Cash ​ ​ — ​ ​ 2.3 ​ ​ 3.9 ​ Total Cash, Cash Equivalents and Restricted Cash, End of the Year ​ $ 266.8 ​ $ 136.3 ​ $ 253.7 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Supplemental Cash Flow Information: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Interest paid, net of capitalized interest ​ $ 5.9 ​ $ 11.1 ​ $ 16.2 ​ Income tax paid, net of income tax refunds ​ $ ( 26.5 ) ​ $ 7.5 ​ $ 215.2 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non-cash Information: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Capital expenditures included in accounts payable, accruals and other liabilities ​ $ 7.9 ​ $ 10.8 ​ $ 5.5 ​ Non-cash payments for intangible asset acquisitions ​ $ — ​ $ 2.7 ​ $ 2.2 ​ ​ See Notes to Consolidated Financial Statements. ​ 47 Table of Contents MATSON, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY FOR THE THREE YEARS ENDED DECEMBER 31, 2024 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Accumulated ​ ​ ​ ​ ​ ​ ​ ​ Common Stock ​ Additional ​ Other ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Stated ​ Paid In ​ Comprehensive ​ Retained ​ ​ ​ (In millions, except per share amounts) Shares Value Capital Income (Loss) Earnings Total Balance at December 31, 2021 41.0 ​ $ 30.7 $ 314.1 ​ $ ( 30.9 ) ​ $ 1,353.5 ​ $ 1,667.4 ​ Net income — ​ — — ​ — ​ 1,063.9 ​ 1,063.9 ​ Other comprehensive income (loss), net of tax — ​ — — ​ 24.0 ​ — ​ 24.0 ​ Share-based compensation — ​ — 18.3 ​ — ​ — ​ 18.3 ​ Shares issued, net of shares withheld for employee taxes 0.3 ​ 0.2 ( 20.3 ) ​ — ​ — ​ ( 20.1 ) ​ Share repurchase ​ ( 5.0 ) ​ ​ ( 3.7 ) ​ ​ ( 21.7 ) ​ ​ — ​ ​ ( 371.6 ) ​ ​ ( 397.0 ) ​ Equity interest in SSAT (see Note 4) ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 11.6 ) ​ ​ ( 11.6 ) ​ Dividends ($ 1.22 per share) — ​ — — ​ — ​ ( 48.0 ) ​ ( 48.0 ) ​ Balance at December 31, 2022 36.3 ​ ​ 27.2 ​ 290.4 ​ ​ ( 6.9 ) ​ ​ 1,986.2 ​ ​ 2,296.9 ​ Net income — ​ — — ​ — ​ 297.1 ​ 297.1 ​ Other comprehensive income (loss), net of tax ​ — ​ — — ​ ( 1.3 ) ​ — ​ ( 1.3 ) ​ Share-based compensation — ​ — 23.8 ​ — ​ — ​ 23.8 ​ Shares issued, net of shares withheld for employee taxes 0.2 ​ ​ 0.2 ​ ( 12.7 ) ​ — ​ ( 0.1 ) ​ ( 12.6 ) ​ Share repurchase ​ ( 2.1 ) ​ ​ ( 1.6 ) ​ ​ ( 8.1 ) ​ ​ — ​ ​ ( 148.5 ) ​ ​ ( 158.2 ) ​ Dividends ($ 1.26 per share) — ​ — — ​ — ​ ( 45.0 ) ​ ( 45.0 ) ​ Balance at December 31, 2023 34.4 ​ ​ 25.8 ​ 293.4 ​ ​ ( 8.2 ) ​ ​ 2,089.7 ​ ​ 2,400.7 ​ Net income — ​ — — ​ — ​ 476.4 ​ 476.4 ​ Other comprehensive income (loss), net of tax — ​ — — ​ 1.7 ​ — ​ 1.7 ​ Share-based compensation — ​ — 26.5 ​ — ​ — ​ 26.5 ​ Shares issued, net of shares withheld for employee taxes 0.2 ​ ​ 0.1 ​ ( 17.7 ) ​ — ​ — ​ ( 17.6 ) ​ Share repurchase ​ ( 1.6 ) ​ ​ ( 1.2 ) ​ ​ ( 5.5 ) ​ ​ — ​ ​ ( 194.3 ) ​ ​ ( 201.0 ) ​ Equity interest in SSAT (see Note 4) ​ — ​ ​ — ​ ​ — ​ ​ — ​ ​ 10.1 ​ ​ 10.1 ​ Dividends ($ 1.32 per share) — ​ — — ​ — ​ ( 44.8 ) ​ ( 44.8 ) ​ Balance at December 31, 2024 33.0 ​ $ 24.7 $ 296.7 ​ $ ( 6.5 ) ​ $ 2,337.1 ​ $ 2,652.0 ​ ​ See Notes to Consolidated Financial Statements. ​ 48 Table of Contents MATSON, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS ​ 1. DESCRIPTION OF THE BUSINESS ​ Matson, Inc., a holding company incorporated in the State of Hawaii, and its subsidiaries (“Matson” or the “Company”), is a leading provider of ocean transportation and logistics services. The Company consists of two segments, Ocean Transportation and Logistics. For financial information on the Company’s reportable segments for the three years ended December 31, 2024 (see Note 3). ​ Ocean Transportation: Matson’s Ocean Transportation business is conducted through Matson Navigation Company, Inc. (“MatNav”), a wholly-owned subsidiary of Matson, Inc. 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 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 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 in Alaska. ​ Matson has a 35 percent ownership interest in SSA Terminals, LLC (“SSAT”), a joint venture between Matson Ventures, Inc., a wholly-owned subsidiary of MatNav, and SSA Ventures, Inc., a subsidiary of Carrix, Inc. 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. Matson records its share of income from SSAT in costs and expenses in the Consolidated Statements of Income and Comprehensive Income, and within the Ocean Transportation segment due to the nature of SSAT’s operations (see Note 4). ​ Logistics: Matson’s Logistics business is conducted through Matson Logistics, Inc. (“Matson Logistics”), a wholly-owned subsidiary of MatNav. Established in 1987, Matson Logistics extends the geographic reach of Matson’s transportation network throughout North America and Asia, and is an asset-light business that provides a variety of logistics services to its customers including: (i) multimodal transportation brokerage of domestic and international rail intermodal services, long-haul and regional highway trucking services, specialized hauling, flat-bed and project services, less-than-truckload services, and expedited freight services (collectively, “Transportation Brokerage” services); (ii) less-than-container load (“LCL”) consolidation and freight forwarding services (collectively, “Freight Forwarding” services); (iii) warehousing, trans-loading, value-added packaging and distribution services (collectively, “Warehousing” services); and (iv) purchase order management, booking services, and non-vessel operating common carrier (“NVOCC”) freight forwarding services (collectively, “Supply Chain Management” services). ​ ​ 2. SIGNIFICANT ACCOUNTING POLICIES ​ Principles of Consolidation: The Consolidated Financial Statements 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 (see Note 4). ​ Fiscal Year: The year end for Matson is December 31. The period end for MatNav occurred on the last Friday in December, except for certain Company subsidiaries whose period closed on December 31. Included in these Consolidated Financial Statements are 52 weeks in fiscal years 2024, 2023 and 2022 for MatNav. ​ Foreign Currency Transactions: The United States (U.S.) dollar is the functional currency for substantially all of the financial statements of the Company’s foreign subsidiaries. Foreign currency denominated assets and liabilities of the Company’s foreign subsidiaries are translated into U.S. dollars at exchange rates existing at the respective balance sheet dates. Translation adjustments resulting from fluctuations in exchange rates are recorded as a component of accumulated other comprehensive loss (gain) within shareholders’ equity. The Company translates the result of operations of its foreign subsidiaries at the average exchange rate during the respective periods. Gains and losses 49 Table of Contents resulting from foreign currency transactions are included in Costs and Expenses in the Consolidated Statements of Income and Comprehensive Income. ​ Use of Estimates: The preparation of the 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. ​ Cash, Cash Equivalents and Restricted Cash: Cash equivalents consist of highly-liquid investments with original maturities of three months or less. The Company carries these investments at cost, which approximates fair value. Restricted cash relates to amounts that are subject to contractual restrictions and are not readily available. Restricted cash was $ 2.3 million at December 31, 2023 and was included in prepaid expenses and other assets in the Consolidated Balance Sheets. The Company did not have any restricted cash at December 31, 2024. ​ Accounts Receivable, net: Accounts receivable represent amounts due from trade customers arising in the normal course of business. Accounts receivable are shown net of allowance for doubtful accounts receivable in the Consolidated Balance Sheets. Allowance for doubtful accounts receivable is established by management based on estimates of collectability. Estimates of collectability are principally based on an evaluation of the current financial condition of the customer and the potential risks to collection, the customer’s payment history, expected future credit losses and other factors which are regularly monitored by the Company. ​ Changes in the allowance for doubtful accounts receivable for the three years ended December 31, 2024, 2023 and 2022 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Balance at ​ Write-offs Balance at Year (in millions) Beginning of Year Expense (1) and Other End of Year 2024 ​ $ 9.9 ​ $ 0.8 ​ $ ( 0.9 ) ​ $ 9.8 2023 ​ $ 13.0 ​ $ ( 2.1 ) ​ $ ( 1.0 ) ​ $ 9.9 2022 ​ $ 10.1 ​ $ 3.2 ​ $ ( 0.3 ) ​ $ 13.0 (1) Expense is shown net of amounts recovered from previously reserved doubtful accounts receivable. ​ Prepaid Expenses and Other Assets: Prepaid expenses and other assets consist of the following at December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, Prepaid Expenses and Other Assets (in millions) 2024 2023 Prepaid fuel ​ $ 31.2 ​ $ 22.5 ​ Prepaid insurance and insurance related receivables ​ 19.1 ​ 19.3 ​ Prepaid operating expenses ​ ​ 8.8 ​ ​ 8.2 ​ Income tax receivables, net ​ ​ 2.0 ​ ​ 125.2 ​ Restricted cash - vessel construction obligations ​ ​ — ​ ​ 2.3 ​ Other ​ 12.8 ​ 11.4 ​ Total ​ $ 73.9 ​ $ 188.9 ​ ​ Income tax receivables for the year ended December 31, 2023 included a 2021 federal tax return refund of $ 118.6 million. On April 19, 2024, the Company received the federal income tax refund of $ 118.6 million and interest of $ 10.2 million earned on the federal income tax refund. ​ Deferred Loan Fees: The Company records deferred loan fees, excluding those related to the revolving credit facility, as a reduction to Total Debt in the Company’s Consolidated Balance Sheets. These costs are being amortized over the life of the related debt using the effective interest method (see Note 8). ​ Deferred loan fees related to the Company’s revolving credit facility are recorded in other long-term assets in the Company’s Consolidated Balance Sheets and are amortized using the straight-line method, as the difference between that method and the use of the effective interest method is not material. 50 Table of Contents ​ Other Long-Term Assets: Other long-term assets consist of the following at December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, Other Long-Term Assets (in millions) 2024 2023 Pension plan assets ​ $ 49.0 ​ $ 34.8 ​ Vessel and equipment spare parts ​ ​ 15.9 ​ ​ 14.2 ​ Insurance related receivables ​ ​ 9.8 ​ ​ 10.2 ​ Other ​ ​ 4.9 ​ ​ 7.2 ​ Total ​ $ 79.6 ​ $ 66.4 ​ ​ Property and Equipment: Property and equipment is stated at cost. Property and equipment is depreciated using the straight-line method over the estimated useful lives of the assets. The estimated useful lives of property and equipment range up to the following maximum lives: ​ ​ ​ ​ Classification Life Vessels 40 years Terminal cranes 30 years Containers and chassis ​ 15 years Terminal equipment and other property 35 years ​ Capitalized Interest: The Company capitalizes interest costs during the period 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 payments 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 Consolidated Balance Sheets (see Note 5). During the years ended December 31, 2024, 2023 and 2022, the Company capitalized $ 4.4 million, $ 2.6 million and $ 0.7 million of interest related to the construction of new vessels, respectively. ​ Leases: Accounting Standards Codification (“ASC”) 842, Leases (“ASC 842”) requires lessees to record leases on their balance sheets but recognize the expenses in their income statements. ASC 842 states that a lessee would recognize a lease liability for the obligation to make lease payments, and a right-of-use asset for the underlying leased asset for the period of the lease term. Refer to Note 9 for additional information on the Company’s lease related disclosures. ​ Deferred Dry-docking Costs: U.S. flagged vessels must meet specified seaworthiness standards established by U.S. Coast Guard rules and classification society rules. These standards require U.S. flagged vessels to undergo two dry-docking inspections within a five-year period, with a maximum of 36 months between them. However, U.S. flagged vessels that are enrolled in the U.S. Coast Guard’s Underwater Survey in lieu of Dry-docking (“UWILD”) program are allowed to have their Intermediate Survey dry-docking requirement met with a less costly underwater inspection. Non-U.S. flagged vessels are required to meet applicable classification society rules and their own local standards for seaworthiness, which also mandate vessels to undergo two dry-docking inspections every five years . ​ The Company is responsible for maintaining its vessels in compliance with U.S. and international standards. As costs associated with dry-docking inspections provide future economic benefits to the Company through continued operation of the vessels, the costs are deferred and amortized until the scheduled date of the next required dry-docking, which is usually over a two to five-year period. Amortization of deferred dry-docking costs are charged to operating expenses of the Ocean Transportation segment in the Consolidated Statements of Income and Comprehensive Income. Routine vessel maintenance and repairs are charged to expense as incurred. ​ Goodwill and Intangible Assets: Goodwill and intangible assets arise as a result of acquisitions made by the Company (see Note 6). Intangible assets consist of customer relationships which are being amortized using the straight-line method over the expected useful lives ranging up to 21 years , and a trade name that has an indefinite life. ​ Impairment Evaluation of Long-Lived Assets, Intangible Assets and Goodwill : The Company evaluates its long-lived assets, intangible assets and goodwill for possible impairment in the fourth quarter, or whenever events or changes in circumstances indicate that it is more likely than not that the fair value is less than its carrying amount. The Company has reporting units within the Ocean Transportation and Logistics reportable segments. ​ 51 Table of Contents Long-lived assets and finite-lived intangible assets are grouped at the lowest level reporting unit for which identifiable cash flows are available. In evaluating for impairment, the estimated future undiscounted cash flows generated by each of these asset groups are compared with the carrying value recorded for each asset group to determine if its carrying value is recoverable. If this review determines that the amount recorded will not be recovered, the amount recorded for the asset group is reduced to its estimated fair value. No impairment charges of long-lived assets and finite-lived intangible assets were recorded for the years ended December 31, 2024, 2023 and 2022. ​ Indefinite-life intangible assets and goodwill are grouped at the lowest level reporting unit for which identifiable cash flows are available. In estimating the fair value of a reporting unit, the Company uses a combination of a discounted cash flow model and fair value based on market multiples of earnings before interest, taxes, depreciation and amortization. Based upon the Company’s evaluation of its indefinite-life intangible assets and goodwill for impairment, the Company determined that the fair value of each reporting unit exceeds book value. No impairment charges of indefinite-life intangible assets and goodwill were recorded for the years ended December 31, 2024, 2023 and 2022. ​ Impairment Evaluation of SSAT: The Company’s investment in SSAT, a related party, is evaluated for impairment whenever there is evidence of impairment during the reporting period. If any impairment is identified, the Company evaluates if the decrease in the fair value of the investment below its carrying value is other-than-temporary. The Company did not identify any impairment of its equity investment in SSAT during the years ended December 31, 2024, 2023 and 2022. ​ Other Liabilities: Other liabilities consist of the following at December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, Other Liabilities (in millions) 2024 2023 Employee incentives and other benefits ​ $ 36.6 ​ $ 33.9 ​ Payroll and vacation ​ ​ 36.1 ​ ​ 38.3 ​ Insurance reserves and other related liabilities - short term ​ ​ 27.2 ​ ​ 17.5 ​ Income tax and other tax related liabilities ​ ​ 8.6 ​ ​ 1.6 ​ Deferred revenues ​ ​ 5.5 ​ ​ 6.4 ​ Multi-employer withdrawal liabilities - short term ​ ​ 4.1 ​ ​ 4.1 ​ Other short-term liabilities ​ ​ 5.1 ​ ​ 6.2 ​ Total ​ $ 123.2 $ 108.0 ​ ​ Other Long-Term Liabilities: Other long-term liabilities consist of the following at December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, Other Long-Term Liabilities (in millions) 2024 2023 Multi-employer withdrawal liability ​ $ 44.2 ​ $ 46.5 ​ Insurance reserves and other related liabilities ​ ​ 25.6 ​ ​ 23.8 ​ Pension and post-retirement liabilities ​ ​ 21.3 ​ ​ 21.8 ​ Long-term tax liabilities ​ 9.1 ​ 8.9 ​ Other long-term liabilities ​ 9.1 ​ 12.7 ​ Total ​ $ 109.3 ​ $ 113.7 ​ ​ Pension and Post-Retirement Plans: The Company is a member of the Pacific Maritime Association (“PMA”) and the Hawaii Stevedoring Industry Committee, which negotiate multi-employer pension plans covering certain shoreside bargaining unit personnel. The Company directly negotiates 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, non-contributory, single employer defined benefit plans and defined contribution plans cover substantially all other employees. ​ The estimation of the Company’s pension and post-retirement benefit expenses and liabilities requires that the Company make various assumptions. These assumptions include factors such as discount rates, expected long-term rates of return on pension plan assets, salary growth, health care cost trend rates, inflation, retirement rates, mortality rates, and expected contributions. Actual results that differ from the assumptions made could materially affect the Company’s financial condition or its future operating results. Additional information about the Company’s pension and post-retirement plans is included in Note 11. ​ 52 Table of Contents Insurance Related Liabilities: The Company purchases insurance with deductibles or self-insured retentions to mitigate significant risks that it is exposed to. Such insurance includes, but is not limited to, employee health, workers’ compensation, marine liability, cybersecurity, auto liability and physical damage to property and equipment. For certain risks, the Company elects to not purchase insurance because of the excessive cost of insurance, the perceived remoteness of the risk or insurance coverage is not commercially available. The Company retains the risk of loss for insurance deductibles and self-insured retentions, for amounts that exceed the limits of the Company’s insurance policies, and for other risks not covered by insurance. ​ When estimating its reserves for retained risks and related liabilities, the Company considers a number of factors, including historical claims experience, demographic factors, current trends, and analyses provided by independent third parties. Periodically, management reviews its assumptions and estimates used to determine the adequacy of the Company’s reserves for retained risks and other related liabilities. ​ Recognition of Revenues and Expenses: Revenue in the Company’s 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: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, Ocean Transportation (in millions) (1) ​ 2024 ​ 2023 ​ 2022 Ocean Transportation services ​ $ 2,762.0 ​ $ 2,420.8 ​ $ 3,508.0 Terminal and other related services ​ ​ 32.0 ​ ​ 36.9 ​ ​ 18.5 Fuel sales ​ ​ 12.4 ​ ​ 12.3 ​ ​ 11.3 Vessel management and related services ​ ​ 3.3 ​ ​ 7.0 ​ ​ 6.8 Total ​ $ 2,809.7 ​ $ 2,477.0 ​ $ 3,544.6 (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. ​ ● 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. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, Logistics (in millions) (1) ​ 2024 ​ 2023 ​ 2022 Transportation Brokerage and Freight Forwarding services ​ $ 538.1 ​ $ 546.8 ​ $ 695.1 Warehousing services ​ ​ 40.0 ​ ​ 42.5 ​ ​ 53.5 Supply Chain Management services ​ 34.0 ​ 28.3 ​ 49.8 Total ​ $ 612.1 ​ $ 617.6 ​ $ 798.4 (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 53 Table of Contents 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 Consolidated Statements of Income and Comprehensive Income. ​ Dividends: The Company recognizes dividends as a liability when approved by the Board of Directors. ​ Repurchase of Shares: During the years ended December 31, 2024, 2023 and 2022, the Company repurchased approximately 1.6 million, 2.1 million and 5.0 million shares, respectively, for $ 201.0 million, $ 158.2 million and $ 397.0 million, respectively. As of December 31, 2024, the number of remaining shares that may be repurchased under the Company’s share repurchase program was approximately 0.8 million shares. On February 27, 2025, the Company’s Board of Directors approved an additional 3.0 million shares of common stock to be added to the Company’s existing share repurchase program and extended the program’s expiration date to December 31, 2027. Shares may be repurchased in the open market from time to time, and may be made pursuant to a trading plan in accordance with Rule 10b5-1 of the Security Exchange Act of 1934. ​ Share-Based Compensation: The Company records compensation expense for all share-based awards made to employees and directors. The Company’s various stock-based compensation plans are more fully described in Note 15. ​ Income Taxes: The estimate of the Company’s income tax expense requires the Company to make various estimates and judgments. These estimates and judgments are applied in the calculation of taxable income, tax credits, tax benefits, CCF and other tax deductions, and in the calculation of certain deferred tax assets and liabilities, which arise from differences in the timing of recognition of revenue, costs and expenses for tax purposes. The Company also considers the impact of expected future events such as changes in tax rates, changes in tax laws, regulations and rulings. Deferred tax assets and liabilities are adjusted to the extent necessary to reflect tax rates expected to be in effect when the temporary differences reverse. ​ The Company records a valuation allowance if, based on the weight of available evidence, management believes that it is more likely than not that some portion or all of a recorded deferred tax asset would not be realized in future periods. The Company’s income taxes are more fully described in Note 10. ​ Rounding: Amounts in the Consolidated Financial Statements and Notes to the Consolidated Financial Statements are rounded to tenth of millions, except for per share calculations and percentages which were determined based on amounts before rounding. Accordingly, a recalculation of some per-share amounts and percentages, if based on the reported data, may be slightly different. ​ Reclassifications: The Company reclassified amortization of deferred loan fees of $ 2.2 million and $ 2.1 million from Depreciation and amortization to Other within cash flows from operating activities in the Consolidated Statements of Cash Flows for the years ended December 31, 2023 and 2022, respectively, 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 years ended December 31, 2023 and 2022. ​ Recently adopted accounting pronouncements: In November 2023, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures (“ASU 2023-07”). ASU 2023-07 requires companies to disclose on an annual and interim basis, significant segment expenses that are regularly provided to the chief operating decision maker. The Company adopted ASU 2023-07 during the year ended December 31, 2024 (see Note 3). ​ New Accounting Pronouncements: In November 2024, the 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 54 Table of Contents 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. ​ ​ 3. REPORTABLE SEGMENTS ​ Reportable segments are components of an enterprise that engage in business activities from which it may earn revenues and incur expenses, whose operating results are regularly reviewed by the chief operating decision maker (“CODM”) to make decisions about resources to be allocated to the segment and assess its performance, and for which discrete financial information is available. The Company’s CODM is its Chief Executive Officer. ​ The Company identified two reportable segments on the basis of internal information provided to the CODM: Ocean Transportation and Logistics which are described in Note 1. Each segment is managed separately based upon fundamental differences in the operations of each segment. The Company’s Ocean Transportation service primarily involves the transportation of customer cargo on Company owned and chartered vessels. The Company’s Logistics service provides customers with logistics solutions primarily using third-party purchased transportation. The Company’s CODM assesses the performance of each segment using operating income. The Company’s CODM reviews the performance of each segment using monthly internal reports which provide variance analysis of actual results by segment compared to budget, forecast and prior year. The Company’s CODM uses this information when making decisions about the allocation of operating and capital resources to each segment. Segment balance sheet information is not provided to the CODM as capital decisions are based upon the Company’s consolidated balance sheet. ​ Reportable segment financial information for the years ended December 31, 2024, 2023 and 2022, are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended ​ Year Ended ​ Year Ended ​ ​ December 31, 2024 ​ December 31, 2023 ​ December 31, 2022 (In millions) Ocean Transportation Logistics ​ Total Ocean Transportation Logistics Total Ocean Transportation Logistics Total Operating Revenue (1)(2) ​ $ 2,809.7 ​ $ 612.1 ​ $ 3,421.8 ​ $ 2,477.0 ​ $ 617.6 ​ $ 3,094.6 ​ $ 3,544.6 ​ $ 798.4 ​ $ 4,343.0 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating Expenses: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating costs: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Direct cargo expense ​ ​ 980.1 ​ ​ — ​ ​ 980.1 ​ ​ 946.2 ​ ​ — ​ ​ 946.2 ​ ​ 1,003.8 ​ ​ — ​ ​ 1,003.8 Vessel operating expense ​ ​ 610.5 ​ ​ — ​ ​ 610.5 ​ ​ 580.4 ​ ​ — ​ ​ 580.4 ​ ​ 703.6 ​ ​ — ​ ​ 703.6 Operating overhead (3) ​ ​ 329.1 ​ ​ — ​ ​ 329.1 ​ ​ 297.7 ​ ​ — ​ ​ 297.7 ​ ​ 301.2 ​ ​ — ​ ​ 301.2 Direct operating costs ​ ​ — ​ ​ 493.1 ​ ​ 493.1 ​ ​ — ​ ​ 504.2 ​ ​ 504.2 ​ ​ — ​ ​ 663.7 ​ ​ 663.7 Depreciation and amortization ​ ​ 141.1 ​ ​ 12.0 ​ ​ 153.1 ​ ​ 130.6 ​ ​ 11.6 ​ ​ 142.2 ​ ​ 131.1 ​ ​ 8.1 ​ ​ 139.2 Total operating costs ​ ​ 2,060.8 ​ ​ 505.1 ​ ​ 2,565.9 ​ ​ 1,954.9 ​ ​ 515.8 ​ ​ 2,470.7 ​ ​ 2,139.7 ​ ​ 671.8 ​ ​ 2,811.5 Loss (Income) from SSAT ​ ​ 1.0 ​ ​ — ​ ​ 1.0 ​ ​ ( 2.2 ) ​ ​ — ​ ​ ( 2.2 ) ​ ​ ( 83.1 ) ​ ​ — ​ ​ ( 83.1 ) General and administrative ​ 247.0 ​ 56.6 ​ 303.6 ​ 229.5 ​ 53.8 ​ 283.3 ​ 206.8 ​ 54.2 ​ 261.0 Total Costs and Expenses ​ ​ 2,308.8 ​ ​ 561.7 ​ ​ 2,870.5 ​ ​ 2,182.2 ​ ​ 569.6 ​ ​ 2,751.8 ​ ​ 2,263.4 ​ ​ 726.0 ​ ​ 2,989.4 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Operating Income: ​ $ 500.9 ​ $ 50.4 ​ ​ 551.3 ​ $ 294.8 ​ $ 48.0 ​ ​ 342.8 ​ $ 1,281.2 ​ $ 72.4 ​ ​ 1,353.6 Interest income ​ ​ ​ ​ ​ ​ ​ ​ 48.3 ​ ​ ​ ​ ​ ​ ​ ​ 36.0 ​ ​ ​ ​ ​ ​ ​ ​ 8.2 Interest expense ​ ​ ​ ​ ​ ​ ​ ​ ( 7.5 ) ​ ​ ​ ​ ​ ​ ​ ​ ( 12.2 ) ​ ​ ​ ​ ​ ​ ​ ​ ( 18.0 ) Other income (expense), net ​ ​ ​ ​ ​ ​ ​ 7.3 ​ ​ ​ ​ ​ ​ ​ 6.4 ​ ​ ​ ​ ​ ​ ​ 8.5 Income before Taxes ​ ​ ​ ​ ​ ​ ​ 599.4 ​ ​ ​ ​ ​ ​ ​ 373.0 ​ ​ ​ ​ ​ ​ ​ 1,352.3 Income taxes ​ ​ ​ ​ ​ ​ ​ ( 123.0 ) ​ ​ ​ ​ ​ ​ ​ ( 75.9 ) ​ ​ ​ ​ ​ ​ ​ ( 288.4 ) Net Income ​ ​ ​ ​ ​ ​ ​ $ 476.4 ​ ​ ​ ​ ​ ​ ​ $ 297.1 ​ ​ ​ ​ ​ ​ ​ $ 1,063.9 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Capital Expenditures (4) ​ $ 298.9 ​ $ 11.2 ​ $ 310.1 ​ $ 240.2 ​ $ 8.2 ​ $ 248.4 ​ $ 190.9 ​ $ 18.4 ​ $ 209.3 ​ (1) Ocean Transportation operating revenue excludes inter-segment revenue of $ 92.8 million, $ 76.5 million and $ 93.6 million for the years ended December 31, 2024, 2023 and 2022, respectively. 55 Table of Contents (2) Logistics operating revenue excludes inter-segment revenue of $ 153.0 million, $ 132.2 million and $ 177.3 million for the years ended December 31, 2024, 2023 and 2022, respectively. (3) Ocean Transportation operating overhead includes dry-docking amortization of $ 27.2 million, $ 25.3 million and $ 24.9 million for the year ended December 31, 2024, 2023 and 2022, respectively. (4) Capital expenditures exclude accrued capital expenditures of $ 7.9 million, $ 10.8 million and $ 5.5 million as of December 31, 2024, 2023 and 2022, respectively. ​ Ocean Transportation’s operating expenses includes the following: ● Operating costs includes: o Direct Cargo Expense includes terminal handling costs including labor and wharfage, outside purchased transportation and other related costs. o Vessel Operating Expense includes crew wages and related costs; fuel; pilots, tugs, lines and related costs; vessel charter expenses; and other vessel operating related expenses. o Operating Overhead Expense includes vessel repair and maintenance costs, inactive vessel costs, dry-docking amortization, equipment lease costs, equipment repair costs, insurance, port engineers and other maintenance costs, other vessel and shoreside related overhead and other indirect costs. o Depreciation and Amortization Expense includes depreciation of property and equipment and amortization of intangible assets. ● Income from SSAT includes the Company’s share of income from its equity investment in SSAT and has been aggregated into the Ocean Transportation segment due to the operations of SSAT being an integral part of the Company’s Ocean Transportation business (see Note 4). ● General and Administrative Expense includes employee salaries, wages and other related costs, equipment maintenance, computer hardware and software, professional fees and other general and administrative expenses. ​ Logistics’ operating expenses includes the following: ● Operating costs includes: o Direct Operating Expense includes transportation costs, transportation brokerage expenses, agency commissions, leases of warehouses, cross-dock and other facility operating costs, wages and other related costs, and other operating overhead. o Depreciation and Amortization Expense includes depreciation of property and equipment and amortization of intangible assets. ● General and Administrative Expense includes employee salaries, wages and other related costs, computer hardware and software, professional fees and other general and administrative expenses. ​ The Company’s Ocean Transportation segment provides ocean transportation services to the Logistics segment, and the Logistics segment provides logistics services to the Ocean Transportation segment in certain transactions. Accordingly, inter-segment revenue of $ 245.8 million, $ 208.7 million and $ 270.9 million for the years ended December 31, 2024, 2023 and 2022, respectively, have been eliminated from operating revenues. In arrangements where the customer purchases ocean transportation and logistics services, the revenues are allocated to each reportable segment based upon the contractual amounts for each type of service. ​ Customer Concentration: The Company’s Ocean Transportation segment serves customers in numerous industries and carries a wide variety of cargo, mitigating its dependence upon any single customer or single type of cargo. The Company’s 10 largest Ocean Transportation customers account for approximately 18 percent of the Company’s Ocean Transportation revenue. ​ The Company’s Logistics segment serves customers in numerous industries. The Company’s 10 largest logistics customers account for approximately 17 percent of the Company’s Logistics revenue. ​ ​ 4. INVESTMENT IN SSAT ​ The Company accounts for its 35 percent ownership interest in SSAT using the equity method of accounting. The Company records its share of income from SSAT in costs and expenses within the Ocean Transportation segment due to operations of SSAT being an integral part of the Company’s Ocean Transportation business. The Company’s investment in SSAT was $ 84.1 million and $ 85.5 million at December 31, 2024 and 2023, respectively. ​ On March 1, 2024, SSAT completed the sale of 25 percent of its equity interest in SSA Terminals (Seattle Terminals), LLC (“SSAT ST”) to a third-party company. After the completion of this transaction, SSAT retains a 50 percent 56 Table of Contents controlling interest in SSAT ST, while the third-party company increased its non-controlling interest to 50 percent in SSAT ST. As a result of this transaction, the Company recorded an increase in its investment in SSAT of approximately $ 13.2 million, an increase in deferred income taxes of $ 3.1 million, and a corresponding increase in retained earnings of $ 10.1 million during the year ended December 31, 2024. ​ On September 16, 2022, SSAT completed the purchase of a 20 percent equity interest in SSAT Terminals (Oakland), LLC (“SSAT Oakland”) from a third-party company. After completion of this transaction, SSAT Oakland became a wholly owned subsidiary of SSAT. The operating results of SSAT Oakland consolidate into the operating results of SSAT. As a result of this transaction, the Company recorded a decrease of $ 15.5 million in its investment in SSAT, an increase in deferred tax assets of $ 3.9 million, and a corresponding decrease in retained earnings of $ 11.6 million during the year ended December 31, 2022. ​ The Company’s share of income recorded in the Consolidated Statements of Income and Comprehensive Income and distributions received by the Company during the years ended December 31, 2024, 2023 and 2022 are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, (In millions) 2024 2023 2022 Company’s share of income from SSAT (1) ​ $ ( 1.0 ) ​ $ 2.2 ​ $ 83.1 Distributions received from SSAT ​ $ 14.0 ​ $ — ​ $ 47.3 (1) Includes an impairment charge of $ 18.4 million representing the Company’s portion of an impairment charge recorded by SSAT, which related to the write-down of an asset group which includes a terminal operating lease asset during the year ended December 31, 2024. No impairment charges were recorded during the years ended December 31, 2023 and 2022. ​ The Company’s Ocean Transportation segment operating costs for terminal services provided by SSAT include $ 320.9 million, $ 297.2 million and $ 308.3 million for the years ended December 31, 2024, 2023 and 2022, respectively. Accounts payable and accrued liabilities in the Consolidated Balance Sheets for terminal services payable to SSAT include $ 34.4 million and $ 43.4 million at December 31, 2024 and 2023, respectively. ​ A summary of SSAT’s Condensed Balance Sheets at December 31, 2024 and 2023 are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, Condensed Balance Sheets (in millions) 2024 2023 Current assets ​ $ 305.7 ​ $ 304.0 Non-current assets ​ 1,625.8 ​ 1,510.2 Total Assets ​ $ 1,931.5 ​ $ 1,814.2 ​ ​ ​ ​ ​ ​ ​ Current liabilities ​ $ 271.9 ​ $ 271.8 Non-current liabilities ​ 1,371.5 ​ 1,255.3 Equity ​ 288.1 ​ 287.1 Total Liabilities and Equity ​ $ 1,931.5 ​ $ 1,814.2 ​ A summary of SSAT’s Condensed Statements of Operating Income and Net Income for the years ended December 31, 2024, 2023 and 2022 are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, Condensed Statements of Operating Income and Net Income (in millions) 2024 2023 2022 Operating revenue ​ $ 1,193.3 ​ $ 1,025.1 ​ $ 1,466.9 Operating costs and expenses ​ 1,162.6 ​ 1,019.6 ​ 1,168.8 Operating income ​ 30.7 ​ 5.5 ​ 298.1 Net (Loss) Income (1)(2) ​ $ ( 6.4 ) ​ $ 11.9 ​ $ 249.6 (1) Includes an impairment charge related to the write-down of an asset group which includes a terminal operating lease asset during the year ended December 31, 2024. No impairment amounts were recorded during the years ended December 31, 2023 and 2022. (2) Includes earnings from equity method investments held by SSAT less earnings allocated to non-controlling interests and includes net income or loss attributable to noncontrolling interests. ​ ​ ​ ​ 57 Table of Contents 5. PROPERTY AND EQUIPMENT ​ Property and equipment consists of the following as of December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, 2024 ​ As of December 31, 2023 ​ ​ ​ Accumulated ​ ​ ​ Accumulated ​ (In millions) ​ Cost ​ Depreciation ​ Net Book Value ​ Cost ​ Depreciation ​ Net Book Value Vessels ​ $ 2,475.2 ​ $ 961.9 ​ $ 1,513.3 ​ ​ $ 2,323.4 ​ $ 886.8 ​ $ 1,436.6 ​ Containers and equipment ​ 883.8 ​ ​ 465.9 ​ 417.9 ​ ​ 845.0 ​ 451.9 ​ 393.1 ​ Terminal equipment and other property ​ 152.3 ​ ​ 64.0 ​ 88.3 ​ ​ 148.0 ​ 58.6 ​ 89.4 ​ New vessel construction in progress ​ ​ 198.8 ​ ​ — ​ ​ 198.8 ​ ​ ​ 103.1 ​ ​ — ​ ​ 103.1 ​ Other construction in progress ​ 42.6 ​ ​ — ​ 42.6 ​ ​ 67.7 ​ — ​ 67.7 ​ Total ​ $ 3,752.7 ​ $ 1,491.8 ​ $ 2,260.9 ​ ​ $ 3,487.2 ​ $ 1,397.3 ​ $ 2,089.9 ​ ​ New vessel construction in progress at December 31, 2024 and 2023 includes milestone progress payments, capitalized interest and other costs related to the construction of three new Jones Act vessels. Delivery of the first vessel is currently anticipated to be in the first quarter 2027, with subsequent deliveries expected in the third quarter 2027 and second quarter 2028. ​ Depreciation expense for the years ended December 31, 2024, 2023 and 2022 are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, (In millions) 2024 2023 2022 Depreciation expense ​ $ 135.4 ​ $ 124.4 ​ $ 123.5 ​ ​ ​ ​ 6. GOODWILL AND INTANGIBLE ASSETS ​ Goodwill by segment consists of the following as of December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Ocean ​ ​ ​ ​ ​ ​ (In millions) Transportation Logistics Total Goodwill ​ $ 222.6 ​ $ 105.2 ​ $ 327.8 ​ Ocean Transportation goodwill of $ 222.6 million includes $ 221.8 million related to the acquisition of Horizon Lines, Inc. (“Horizon”) in May 2015. Logistics goodwill of $ 105.2 million includes $ 78.6 million related to the acquisition of Span Intermediate, LLC (“Span Alaska”) in August 2016 that was allocated to the Span Alaska reporting unit, and $ 26.6 million of other Logistics acquisitions that were allocated to the Logistics reporting unit. ​ Intangible assets by segment consist of the following as of December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, 2024 ​ As of December 31, 2023 ​ ​ Gross ​ Accumulated ​ ​ ​ ​ Gross ​ Accumulated ​ ​ ​ (In millions) Amount Amortization Net Book Value Amount Amortization Net Book Value Ocean Transportation - Customer relationships ​ $ 140.6 ​ $ 64.4 ​ $ 76.2 ​ ​ $ 140.6 ​ $ 57.9 ​ $ 82.7 ​ Logistics: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Customer relationships ​ ​ 106.2 ​ ​ 50.3 ​ ​ 55.9 ​ ​ ​ 110.4 ​ ​ 44.0 ​ ​ 66.4 ​ Trade name ​ 27.3 ​ ​ — ​ ​ 27.3 ​ ​ 27.3 ​ ​ — ​ ​ 27.3 ​ Total Logistics ​ 133.5 ​ ​ 50.3 ​ ​ 83.2 ​ ​ 137.7 ​ ​ 44.0 ​ ​ 93.7 ​ Total ​ $ 274.1 ​ $ 114.7 ​ $ 159.4 ​ ​ $ 278.3 ​ $ 101.9 ​ $ 176.4 ​ ​ In February 2023, the Company completed an asset acquisition consisting of customer relationship intangible assets for $ 16.5 million, which are being amortized over seven years . ​ Ocean Transportation intangible assets of $ 140.6 million relate to customer relationships acquired as part of the acquisition of Horizon, and are being amortized over 21 years . Logistics intangible assets include $ 79.3 million of customer relationships which are being amortized over 20 years , and $ 27.3 million of an indefinite life trade name, both acquired as part of the Span Alaska acquisition. The remaining Logistics customer relationships relate to various acquisitions and are being amortized over a period of 3 to 13 years . ​ 58 Table of Contents Intangible assets related amortization expense for the years ended December 31, 2024, 2023 and 2022, are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, (In millions) 2024 2023 2022 Amortization expense ​ $ 12.8 ​ $ 13.6 ​ $ 11.4 ​ ​ As of December 31, 2024, estimated amortization expense related to customer relationship intangible assets during the next five years and thereafter are as follows: ​ ​ ​ ​ ​ ​ ​ Customer ​ Year (in millions) ​ Relationships 2025 ​ $ 13.0 ​ 2026 ​ 12.5 ​ 2027 ​ 12.6 ​ 2028 ​ 12.5 ​ 2029 ​ 12.5 ​ Thereafter ​ 69.0 ​ Total ​ $ 132.1 ​ ​ ​ ​ 7. CAPITAL CONSTRUCTION FUND ​ The Company is party to an agreement with the U.S. Department of Transportation, Maritime Administration (“MARAD”) that established a Capital Construction Fund (“CCF”) program under provisions of the Merchant Marine Act of 1936, as amended (the “Merchant Marine Act”). The CCF program was created to assist owners and operators of U.S. flagged vessels in raising capital necessary for the modernization and expansion of the U.S. merchant marine fleet. CCF funds may be used for the acquisition, construction, or reconstruction of vessels, and for repayment of existing vessel indebtedness through the deferment of federal income taxes on certain deposits of monies and other property placed into the CCF. Qualified withdrawals from the CCF must be used for investment in vessels built in the U.S. and used between covered U.S. ports as described by the Merchant Marine Act, and for other qualifying expenditures (see Item 1 of Part 1 for additional information on Maritime Laws and the Jones Act). Participants of the CCF must also meet certain U.S. citizenship requirements. ​ Cash deposits into the CCF are limited by certain applicable earnings and other conditions. Such cash deposits, once made, are available as tax deductions in the Company’s income tax provision. Qualified withdrawals from the CCF do not give rise to a current income tax liability, but reduce the depreciable basis of the vessels or certain related equipment for income tax purposes. However, if withdrawals are made from the CCF for general corporate purposes or other non-qualified purposes, or upon termination of the agreement, they are taxable with interest payable from the year of deposit. ​ Deposits not committed for qualified purposes within 25 years from the date of deposit will be treated as non-qualified withdrawals over the subsequent five years . Under the terms of the CCF agreement, the Company may designate certain qualified earnings as “accrued deposits” or may designate, as obligations of the CCF, qualified withdrawals to reimburse qualified expenditures initially made with operating funds. Such accrued deposits to, and withdrawals from, the CCF are reflected in the Consolidated Balance Sheets either as obligations of the Company’s current assets or as receivables from the CCF. ​ The Company may invest funds on deposit in the CCF in money market funds, U.S. Treasury Obligation Funds or other eligible credit-based investments for maturities of up to 3 years. ​ 59 Table of Contents A summary of the activities within the CCF cash and cash equivalents, and investment accounts for the years ended December 31, 2024 and 2023 consists of the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended ​ ​ December 31, (In millions) 2024 2023 CCF Cash and Cash Equivalents: ​ ​ ​ ​ ​ ​ CCF cash and cash equivalents balance at beginning of period ​ $ 599.4 ​ $ 518.2 Cash deposits into the CCF ​ ​ 50.0 ​ ​ 100.0 Cash paid for purchase of U.S. Treasury debt securities and accrued interest ​ ​ ( 449.8 ) ​ ​ — Proceeds from U.S. Treasury debt securities at maturity ​ ​ 48.1 ​ ​ — Interest income deposited into the CCF ​ ​ 18.8 ​ ​ 31.1 Repurchase of assigned accounts receivable ​ ​ 53.8 ​ ​ — Qualifying withdrawal payments out of the CCF ​ ​ ( 89.6 ) ​ ​ ( 49.9 ) Total CCF cash and cash equivalents balance at end of period ​ $ 230.7 ​ $ 599.4 ​ ​ ​ ​ ​ ​ ​ CCF Investments: ​ ​ ​ ​ ​ ​ CCF investments balance at beginning of period ​ $ — ​ $ — Purchase of U.S. Treasury debt securities ​ ​ 448.1 ​ ​ — Withdrawals of U.S. Treasury debt securities at maturity ​ ​ ( 48.1 ) ​ ​ — Accretion of investments ​ ​ 11.9 ​ ​ — Total CCF investments balance at end of period ​ ​ 411.9 ​ ​ — Total CCF cash and cash equivalents, and investments balance at end of period ​ $ 642.6 ​ $ 599.4 ​ Cash on deposit and assigned accounts receivables in the CCF as of December 31, 2024 and 2023 are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, (In millions) 2024 2023 Capital Construction Fund: ​ ​ ​ ​ ​ ​ Cash and cash equivalents, and investments account ​ $ 642.6 ​ $ 599.4 Assigned accounts receivables ​ $ 178.1 ​ $ 218.1 ​ Cash on deposit in the CCF is invested in a U.S. Treasury obligations fund with daily liquidity. At December 31, 2024, securities held within the U.S. Treasury obligations fund had a weighted average life of 96 days . The Company’s CCF investments are in fixed-rate U.S. Treasury obligations with various maturity dates of up to 3 years. Cash on deposit and investment in the CCF are classified as a long-term asset on the Company’s Condensed Consolidated Balance Sheets, as the Company intends to use withdrawals to fund qualified milestone progress payments for the construction of three new Jones Act vessels. ​ Assigned accounts receivable in the CCF are classified as part of accounts receivable on the Company’s Consolidated Balance Sheets due to the nature of the assignment. During the year ended December 31, 2024, the Company repurchased assigned accounts receivables of $ 53.8 million. During the year ended December 31, 2023, the Company assigned $ 200.0 million of accounts receivables into the CCF. ​ ​ 60 Table of Contents 8. DEBT ​ The Company’s debt consists of the following as of December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, (In millions) 2024 2023 Private Placement Term Loans: ​ ​ ​ ​ ​ ​ 3.37 %, payable through 2027 ​ $ 34.6 ​ $ 46.2 3.14 %, payable through 2031 ​ ​ 100.1 ​ ​ 114.4 Title XI Debt: ​ ​ ​ ​ ​ ​ 1.22 %, payable through 2043 ​ ​ 150.3 ​ ​ 158.2 1.35 %, payable through 2044 ​ ​ 115.9 ​ ​ 121.8 Total Debt ​ 400.9 ​ 440.6 Less: Current portion ​ ( 39.7 ) ​ ( 39.7 ) Total Long-term Debt ​ ​ 361.2 ​ ​ 400.9 Less: Deferred loan fees ​ ​ ( 10.4 ) ​ ​ ( 11.6 ) Total Long-term Debt, net of deferred loan fees ​ $ 350.8 ​ $ 389.3 ​ The following is a description of the Company’s debt: ​ Private Placement Term Loans : In September 2016, the Company issued $ 200.0 million of 15 -year senior unsecured notes (the “Series D Notes”) at an interest rate of 3.14 percent, payable semi-annually. In December 2016, the Company issued $ 75 million of 11 -year senior unsecured notes at an interest rate of 3.37 percent, payable semi-annually. ​ Title XI Bonds: In April 2020, MatNav issued $ 185.9 million in U.S. government guaranteed vessel financing bonds to partially refinance debt incurred in connection with the construction of Daniel K. Inouye (the “DKI Title XI Debt”). The secured DKI Title XI Debt matures in October 2043 and has a cash interest rate of 1.22 percent, payable semi-annually in arrears. ​ In June 2020, MatNav issued $ 139.6 million in U.S. government guaranteed vessel financing bonds to partially refinance debt incurred in connection with the construction of Kaimana Hila (the “KMH Title XI Debt”, and together with the DKI Title XI Debt, the “Title XI Debt”). The secured KMH Title XI Debt matures in March 2044 and has a cash interest rate of 1.35 percent, payable semi-annually in arrears. ​ MatNav may prepay any amounts outstanding under the Title XI Debt agreements subject to a potential prepayment premium or other adjustment, in accordance with the Title XI Debt agreements. Once amounts under the Title XI Debt are repaid, they may not be reborrowed. Mandatory prepayments are required under certain limited circumstances, including specified casualty events with respect to Daniel K. Inouye and Kaimana Hila (the “Vessels”). ​ Revolving Credit Facility: In March 2021, the Company entered into the Second Amended and Restated Credit Agreement (the “Credit Agreement”), which extended the maturity date to March 31, 2026, and retained the committed aggregate borrowings of up to $ 650 million. The Credit Agreement amended certain covenants and other terms including (i) amending the pricing grid to provide for pricing ranging from, at the Company’s election, LIBOR plus a margin between 1.00 percent and 1.75 percent depending on the Company’s consolidated net leverage ratio, or base rate plus a margin between 0.00 percent and 0.75 percent depending on the Company’s consolidated net leverage ratio; and (ii) reducing the maximum permitted consolidated leverage ratio to 3.50 to 1.0, with an option for a one-time increase to 4.0 to 1.0 in connection with a material acquisition. The Company may prepay any amounts outstanding under the Credit Agreement without premium or penalty. The Credit Agreement contains affirmative, negative and financial covenants customary for financings of this type, including, among other things, limitations on certain other indebtedness, loans and investments, liens, mergers, asset sales, and transactions with affiliates. The Credit Agreement also contains customary events of default. ​ In February 2023, the Company further amended the Credit Agreement to replace LIBOR with a new benchmark interest rate, the Secured Overnight Financing Rate (“SOFR”). There were no other significant changes to the Credit Agreement as a result of this amendment. ​ As of December 31, 2024, the Company had $ 643.9 million of remaining borrowing availability under the revolving credit facility. The Company used $ 6.1 million of the revolving credit facility for letters of credit outstanding as of 61 Table of Contents December 31, 2024. Borrowings under the revolving credit facility are classified as long-term debt in the Company’s Consolidated Balance Sheets, as principal payments are not required until the maturity date. ​ Amendments to Existing Private Placement Term Loan Facilities and New Shelf Facilities (“Private Loan Facilities”): In March 2021, the Company and the holders of the notes party thereto entered into amendments (collectively, the “2021 Note Amendments”) to each of (i) the Third Amended and Restated Note Purchase Agreement and Private Shelf Agreement dated as of September 14, 2016, among the Company and the holders of the notes issued thereunder, as amended; and (ii) the Note Purchase Agreement dated December 21, 2016 among the Company and the holders of the notes issued thereunder, in each case as amended prior to such date. ​ The 2021 Note Amendments amended certain covenants and other terms, including the reduction of the maximum permitted consolidated leverage ratio to 3.50 to 1.0, with an option for a one-time increase to 4.0 to 1.0 in connection with a material acquisition, with potential interest enhancement payments if leverage is over 3.25 to 1.0. The Company paid fees of approximately $ 0.8 million related to the 2021 Note Amendments which is included in deferred loan fees in debt in the Company’s Consolidated Balance Sheets. ​ Debt Maturities: At December 31, 2024, debt maturities during the next five years and thereafter are as follows: ​ ​ ​ ​ ​ ​ ​ As of Year (in millions) December 31, 2024 2025 ​ $ 39.7 2026 ​ 39.7 2027 ​ 39.7 2028 ​ 28.2 2029 ​ 28.2 Thereafter ​ 225.4 Total Debt ​ $ 400.9 ​ Deferred Loan Fees: Activity relating to deferred loan fees for the year ended December 31, 2024 are as follows: ​ ​ ​ ​ ​ Deferred Loan Fees (in millions) Amount Balance at December 31, 2023 ​ $ 11.6 Amortization expense for the year ended December 31, 2024 ​ ( 1.2 ) Balance at December 31, 2024 ​ $ 10.4 ​ As of December 31, 2024, amortization expense relating to deferred loan fees during the next five years and thereafter are as follows: ​ ​ ​ ​ ​ Year (in millions) Amount 2025 ​ $ 1.1 2026 ​ 1.0 2027 ​ 0.9 2028 ​ 0.9 2029 ​ 0.8 Thereafter ​ 5.7 Total amortization expense of deferred loan fees ​ $ 10.4 ​ Title XI Debt Covenants: The Title XI Debt agreements contain customary representations and warranties as well as affirmative and negative covenants, defaults and other provisions typical for MARAD-guaranteed financings of this type, with definitions, limitations and financial tests all as negotiated between MatNav and MARAD. The covenants in the Title XI Debt agreements include, among other things, limitations on certain other indebtedness, loans and investments, liens, mergers, asset sales, sale and leasebacks, and transactions with affiliates as defined within the Title XI Debt agreements. Certain of the covenants in the Title XI Debt agreements are applicable only upon and during the continuance of either (i) an event of default or (ii) the failure of either the Company or MatNav to meet certain supplemental financial tests, including the following: ​ 62 Table of Contents ● The supplemental financial tests applicable to MatNav include maintenance of a working capital minimum of $ 1 , and maintenance of a long-term debt to net worth ratio of greater than or equal to 2.0 to 1.0; and ● The supplemental financial tests applicable to the Company include maintenance of a net worth greater than or equal to 90 % of the net worth of the Company as set forth in the most recent audited financial statements prior to closing of the issuance of the Title XI Bonds and compliance with the leverage ratio set forth in the Credit Agreement. ​ Debt Security and Guarantees: All of the debt of the Company and MatNav, including related guarantees, as of December 31, 2024 was unsecured, except for the Title XI Debt. ​ Under the Title XI Debt agreements, MARAD has guaranteed certain obligations of MatNav. MatNav has agreed to reimburse MARAD for any payments it makes under the MARAD guaranty, and MatNav’s obligations to MARAD with respect to the Title XI Debt are secured by a mortgage on the Vessels and certain other related assets (the “Collateral”). In addition, MatNav’s obligations to MARAD with respect to the Title XI Debt are guaranteed by the Company under an Affiliate Guaranty. ​ ​ 9. LEASES ​ Description of Operating Leases: The Company has different types of operating leases, the specific terms and conditions of which vary from lease to lease. Certain operating lease agreements include terms such as: (i) renewal and early termination options; (ii) early buy-out and purchase options; and (iii) rent escalation clauses. The lease agreements also include provisions for the maintenance of the leased asset and payment of lease related costs. The Company reviews the specific terms and conditions of each lease and, as appropriate, notifies the lessor of any intent to exercise any option in accordance with the terms of the lease. In the normal course of business, the Company expects to be able to renew or replace most of its operating leases with other similar leases as they expire. The Company’s leases do not contain any residual value guarantees. ​ The Company’s sub-lease income was nominal to the Company’s Consolidated Statements of Income and Comprehensive Income for the years ended December 31, 2024 and 2023. The Company did not have any finance leases during the years ended December 31, 2024 and 2023. Certain of the Company’s lease agreements include rental payments that may be adjusted in the future based on economic conditions and others include rental payments adjusted periodically for inflation. Variable lease expense is disclosed for the adjusted portion of such payments. ​ The lease type by underlying asset class and maximum terms of the Company’s operating leases are as follows: ​ ​ ​ ​ Lease Type: Term Real estate and terminal leases 50 years Vessel and barge charter leases 4 years Operations equipment and other leases 14 years ​ Incremental Borrowing Rate: As most of the Company’s operating leases do not provide an implicit rate, the Company uses an estimated incremental borrowing rate based on information available at the date of adoption and subsequent lease commencement dates in calculating the present value of its operating lease liabilities. The incremental borrowing rate is determined using the U.S. Treasury rate adjusted to account for the Company’s credit rating and the collateralized nature of operating leases. ​ Components of Lease Cost: Components of lease cost recorded in the Company’s Consolidated Statement of Income and Comprehensive Income consists of the following for the years ended December 31, 2024, 2023 and 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended ​ ​ December 31, (In millions) 2024 ​ 2023 ​ 2022 Operating lease cost ​ $ 143.4 ​ $ 151.0 ​ $ 162.2 Short-term lease cost ​ 10.4 ​ 7.7 ​ 0.6 Variable lease cost ​ 0.6 ​ 0.6 ​ 0.8 Total lease cost ​ $ 154.4 ​ $ 159.3 ​ $ 163.6 ​ 63 Table of Contents Other Lease Information: Other information related to the Company’s operating leases consists of the following for the years ended December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended ​ ​ December 31, (In millions) 2024 ​ 2023 Cash paid for amounts included in operating lease liabilities ​ $ 148.7 ​ $ 154.3 Right of use assets obtained in the exchange for new operating lease liabilities ​ $ 205.8 ​ $ 40.0 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, ​ ​ 2024 2023 Weighted average remaining operating lease term ​ ​ 5.3 years ​ ​ 4.8 years Weighted average incremental borrowing rate ​ ​ 4.3 % ​ ​ 3.1 % ​ Maturities of operating lease liabilities consist of the following at December 31, 2024: ​ ​ ​ ​ ​ ​ As of Year (in millions) December 31, 2024 2025 ​ $ 133.3 2026 ​ 98.0 2027 ​ 71.2 2028 ​ 21.4 2029 ​ 10.1 Thereafter ​ 79.9 Total lease payments ​ ​ 413.9 Less: Interest ​ ​ ( 55.4 ) Present value of operating lease liabilities ​ ​ 358.5 Less: Short-term portion ​ ​ ( 129.0 ) Long-term operating lease liabilities ​ $ 229.5 ​ ​ ​ 10. INCOME TAXES ​ Income Taxes: Income taxes consist of the following for the years ended December 31, 2024, 2023 and 2022: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, (In millions) 2024 2023 2022 Current: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Federal ​ $ 86.8 ​ $ 44.0 ​ $ 171.5 ​ State ​ 12.4 ​ 9.2 ​ 18.3 ​ Foreign ​ ​ 3.5 ​ ​ 3.0 ​ ​ 1.3 ​ Total current tax expense ​ 102.7 ​ 56.2 ​ 191.1 ​ Deferred: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Federal ​ ​ 17.9 ​ ​ 18.2 ​ ​ 71.1 ​ State ​ ​ 2.8 ​ ​ — ​ ​ 24.3 ​ Foreign ​ ​ ( 0.4 ) ​ ​ 1.5 ​ ​ 1.9 ​ Total deferred tax expense ​ ​ 20.3 ​ ​ 19.7 ​ ​ 97.3 ​ Total income taxes ​ $ 123.0 ​ $ 75.9 ​ $ 288.4 ​ ​ 64 Table of Contents Income taxes for the years ended December 31, 2024, 2023 and 2022 vary from amounts computed by applying the statutory U.S. federal income tax rate due to the following: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, ​ 2024 2023 2022 U.S. federal income tax rate 21.0 % 21.0 % 21.0 % State and local taxes, net of federal benefit 2.3 % 2.6 % 2.8 % Foreign-derived intangible income (FDII) ( 2.6 ) % ( 2.0 ) % ( 2.4 ) % Foreign taxes 0.3 % 0.4 % 0.1 % Share-based payments 0.2 % 0.5 % — % Return to provision true-ups ​ ( 0.7 ) % ( 2.8 ) % 0.1 % Other, net — % 0.6 % ( 0.3 ) % Effective income tax rate 20.5 % 20.3 % 21.3 % ​ The tax effects of temporary differences that gave rise to significant positions of deferred tax assets and deferred tax liabilities at December 31, 2024 and 2023, were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ As of December 31, (In millions) 2024 2023 Deferred tax assets: ​ ​ ​ ​ ​ ​ ​ Operating lease liabilities ​ $ 84.0 ​ $ 77.4 ​ Deferred compensation ​ 12.1 ​ ​ 11.8 ​ Multi-employer withdrawal liabilities ​ ​ 11.4 ​ ​ 12.8 ​ Insurance reserves ​ ​ 7.8 ​ ​ 6.3 ​ U.S. state alternative minimum tax credits ​ ​ 5.9 ​ ​ 7.4 ​ Other ​ 15.8 ​ 12.9 ​ Total deferred tax assets ​ 137.0 ​ 128.6 ​ Valuation allowance ​ ​ ( 5.0 ) ​ ​ ( 5.3 ) ​ Total deferred tax assets, net of valuation allowance ​ ​ 132.0 ​ ​ 123.3 ​ ​ ​ ​ ​ ​ ​ ​ ​ Deferred tax liabilities: ​ ​ ​ ​ ​ ​ ​ Basis differences for property and equipment ​ 482.7 ​ 451.4 ​ Capital Construction Fund ​ 192.1 ​ ​ 206.9 ​ Operating lease right of use assets ​ 83.8 ​ 75.8 ​ Intangibles ​ ​ 40.3 ​ ​ 42.3 ​ Other ​ ​ 26.5 ​ ​ 16.2 ​ Total deferred tax liabilities ​ 825.4 ​ 792.6 ​ Deferred tax liability, net ​ $ 693.4 ​ $ 669.3 ​ ​ Income Tax Receivables: The Company had income tax receivables of approximately $ 2.0 million and $ 125.2 million at December 31, 2024 and 2023, respectively. The income tax receivable for the year ended December 31, 2023 included a 2021 federal income tax refund of approximately $ 118.6 million. On April 19, 2024, the Company received the federal income tax refund of $ 118.6 million and interest of $ 10.2 million earned on the federal income tax refund. These income tax receivable amounts have been included in prepaid expenses and other assets in the Company’s Consolidated Balance Sheets (see Note 2). ​ State Income Tax Operating Losses, State Tax Credit and Valuation Allowance: The Company’s U.S. state income tax net operating losses (“NOLs”) and U.S. state tax credit carryforwards consist of the following at December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (In millions) ​ Expiration Date 2024 2023 U.S. state income tax NOLs (1) ​ Various dates beginning in 2032 ​ $ 136.5 ​ $ 152.3 U.S. state alternative minimum tax credits ​ No expiration date ​ $ 5.9 ​ $ 7.3 (1) U.S. State income tax NOLs were acquired as part of the Horizon acquisition and are presented on a gross tax basis. These U.S. state income tax NOLs are excluded from the Company’s deferred tax assets and deferred tax liabilities above as the Company does not expect to benefit from any of the $ 136.5 million and $ 152.3 million balance as of December 31, 2024 and 2023, respectively. ​ 65 Table of Contents The Company recorded a valuation allowance against its unusable portion of U.S. state income tax NOLs of $ 5.0 million and $ 5.3 million as of December 31, 2024 and 2023, respectively, as the Company believes that it is more likely than not that the benefit from these deferred assets will not be realized. ​ Unrecognized Tax Benefits: Total unrecognized benefits represent the amount that, if recognized, would favorably affect the Company’s income taxes and effective tax rate in future periods. The Company does not expect a material change in gross unrecognized benefits in the next twelve months. A reconciliation of the beginning and ending amount of gross unrecognized tax benefits is as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, Unrecognized Tax Benefits (in millions) ​ 2024 2023 2022 Balance at beginning of year ​ $ 28.4 ​ $ 25.1 ​ $ 19.2 Tax position changes in current year ​ ( 0.7 ) ​ 3.6 ​ 5.8 Tax position changes in prior years ​ ( 0.1 ) ​ ( 0.1 ) ​ 0.3 Reductions for lapse of statute of limitations ​ ​ ( 0.9 ) ​ ​ ( 0.2 ) ​ ​ ( 0.2 ) Balance at end of year ​ $ 26.7 ​ $ 28.4 ​ $ 25.1 ​ Included in the balance of unrecognized tax benefits at December 31, 2024 are potential benefits of $ 22.9 million that, if recognized, would affect the Company’s income taxes and effective tax rate. The Company recognizes potential accrued interest and penalties related to unrecognized tax benefits in income taxes. To the extent interest and penalties are not ultimately assessed with respect to the settlement of uncertain tax positions, amounts accrued will be reduced and reflected as a reduction of the Company’s income taxes. Interest and penalties accrued related to the balance of unrecognized tax benefits were $ 1.2 million and $ 1.4 million as of December 31, 2024, and $ 0.9 million and $ 1.5 million as of December 31, 2023, respectively. During the years ended December 31, 2024 and 2023, the Company recognized $ 0.4 million and $ 0.7 million, respectively, in income taxes related to interest and penalties. ​ The Company is no longer subject to U.S. federal income tax audits for years before 2017. The Company is routinely involved in federal, state, local income and excise tax audits, and foreign tax audits. ​ ​ 11. PENSION AND POST-RETIREMENT PLANS ​ Qualified Pension and Post-retirement Benefits Plans: The Company provides a funded qualified single employer defined benefit pension plan that covers most non-bargaining employees and certain clerical bargaining unit employees. The Company also provides a post-retirement benefit plan that provides health and life insurance benefits, and covers substantially all salaried, non-bargaining employees hired before 2008, and certain bargaining unit employees. Employees are generally eligible for such benefits upon retirement and completion of a specified number of years of service. The Company does not pre-fund the post-retirement benefit plan and has the right to modify or terminate the plan in the future, with the exception of the benefits pertaining to the bargaining unit employees. Most non-bargaining retirees pay a portion of these post-retirement benefit costs. ​ Plan Administration, Investments and Asset Allocations: The Company has a Benefits Investment Committee that meets regularly with investment advisors to establish investment policies, direct investments and select investment options for the qualified plan. The Benefits Investment Committee is also responsible for appointing investment managers and monitoring their performance. The Company’s investment policy permits investments in marketable equity securities, such as domestic and foreign stocks, domestic and foreign bonds, real estate investments, and cash equivalents. The Company’s investment policy does not permit direct investment in certain types of assets, such as options or commodities, or the use of certain strategies, such as short selling or the purchase of securities on margin. ​ The Company’s investment strategy for its qualified pension plan assets is to achieve a diversified mix of investments that provides for long-term growth at an acceptable level of risk, and to provide sufficient liquidity to fund ongoing benefit payments. The Company has engaged a number of investment managers to implement various investment strategies to achieve the desired asset class mix, liquidity and risk diversification objectives. ​ 66 Table of Contents The Company’s target and actual asset allocations at December 31, 2024 and 2023 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ Asset Categories Target 2024 2023 Domestic equity securities 55 % 58 % 57 % International equity securities 15 % 16 % 16 % Debt securities 20 % 19 % 19 % Real estate 5 % 5 % 5 % Other and cash 5 % 2 % 3 % Total 100 % 100 % 100 % ​ The Company’s investments in equity securities primarily include domestic large-cap and mid-cap companies, but also includes an allocation to small-cap and international equity securities. Equity investments do not include any direct holdings of the Company’s stock but may include such holdings to the extent that the stock is included as part of certain mutual fund holdings. Debt securities include investment-grade and high-yield corporate bonds from diversified industries, mortgage-backed securities, and U.S. Treasuries. Other types of investments include funds that invest in commercial real estate assets. All assets within specific funds are allocated to the target asset allocation of the fund. ​ The expected return on plan assets is principally based on the Company’s historical returns combined with the Company’s long-term future expectations regarding asset class returns, the mix of plan assets, and inflation assumptions. ​ Actual return on plan assets for the periods presented are as follows: ​ ​ ​ ​ ​ Actual Return on Plan Assets Returns One-year return 9.9 % Three-year return 3.1 % Five-year return 7.1 % Long-term average return (since plan inception in 1989) 8.2 % ​ The Company’s pension plan assets are held in a trust and are stated at estimated fair values of the underlying investments. Purchases and sales of securities are recorded on a trade-date basis. Interest income is recorded on an accrual basis. Dividends are recorded on the ex-dividend date. ​ Equity Securities: Domestic and international common stocks are valued by obtaining quoted prices on recognized and highly liquid exchanges. ​ Fixed Income Securities: Corporate bonds and U.S. government treasury and agency securities are valued based on the closing price reported in the market in which the security is traded. U.S. government agency and corporate asset-backed securities may utilize models, such as a matrix pricing model, that incorporate other observable inputs when broker/dealer quotes are not available, such as cash flow, security structure, or market information. ​ Real Estate and Certain International Equity Funds: The fair value of real estate and certain developed and emerging market equity funds is determined by the issuer based on their net asset value (“NAV”). NAV is determined by dividing the fund’s net assets, as recorded in the fund’s audited financial statements, by the number of units outstanding at the valuation date. Fair value for the underlying investments in real estate is determined through independent property appraisals. ​ 67 Table of Contents The fair values of the Company’s pension plan assets at December 31, 2024 and 2023 by asset category were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements at December 31, 2024 ​ ​ ​ Quoted Prices in Significant Significant ​ ​ ​ ​ ​ Active Markets ​ Observable ​ Unobservable Asset Category (in millions) ​ Total ​ (Level 1) ​ Inputs (Level 2) ​ Inputs (Level 3) Cash ​ $ 5.1 ​ $ 5.1 ​ $ — ​ $ — ​ Equity securities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ U.S. large-cap ​ 90.9 ​ 90.9 ​ — ​ — ​ U.S. mid- and small-cap ​ 50.2 ​ 50.2 ​ — ​ — ​ International large-cap ​ 7.1 ​ 7.1 ​ — ​ — ​ Fixed income securities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ U.S. Treasuries ​ 20.0 ​ 12.9 ​ 7.1 ​ — ​ Municipal bonds ​ 0.2 ​ — ​ 0.2 ​ — ​ Investment grade U.S. corporate bonds ​ ​ 24.9 ​ — ​ 24.9 ​ — ​ Convertible bonds ​ 0.1 ​ — ​ 0.1 ​ — ​ International fixed income securities ​ ​ 0.1 ​ ​ — ​ ​ 0.1 ​ ​ — ​ Total ​ ​ 198.6 ​ $ 166.2 ​ $ 32.4 ​ $ — ​ Investment measured at NAV (1) ​ ​ 42.6 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total plan assets ​ $ 241.2 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair Value Measurements at December 31, 2023 ​ ​ ​ Quoted Prices in Significant Significant ​ ​ ​ ​ ​ Active Markets ​ Observable ​ Unobservable Asset Category (in millions) ​ Total ​ (Level 1) ​ Inputs (Level 2) ​ Inputs (Level 3) Cash ​ $ 6.1 ​ $ 6.1 ​ $ — ​ $ — ​ Equity securities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ U.S. large-cap ​ 82.8 ​ 82.8 ​ — ​ — ​ U.S. mid- and small-cap ​ 46.0 ​ 46.0 ​ — ​ — ​ International large-cap ​ 7.1 ​ 7.1 ​ — ​ — ​ Fixed income securities: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ U.S. Treasuries ​ 19.2 ​ — ​ 19.2 ​ — ​ Municipal bonds ​ 0.2 ​ — ​ 0.2 ​ — ​ Investment grade U.S. corporate bonds ​ 24.7 ​ — ​ 24.7 ​ — ​ Convertible bonds ​ ​ 0.1 ​ — ​ ​ 0.1 ​ ​ ​ ​ International fixed income securities ​ 0.1 ​ — ​ 0.1 ​ — ​ Total ​ ​ 186.3 ​ $ 142.0 ​ $ 44.3 ​ $ — ​ Investment measured at NAV (1) ​ ​ 41.6 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Total plan assets ​ $ 227.9 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (1) Certain funds for which fair value is measured using the NAV per share as a practical expedient are not leveled within the fair value hierarchy and are included as a reconciling item to total plan assets. These investments include real estate and certain developed and emerging market equity funds. ​ Contributions to the qualified single employer defined benefit pension plan are determined annually by the Company, taking into consideration recommendations from the actuary based upon the actuarially determined minimum required contributions under the Employee Retirement Income Security Act of 1974 (“ERISA”), as amended, the Pension Protection Act of 2006, and the maximum deductible contribution allowed for tax purposes. The Company’s funding policy is to contribute cash so that it meets at least the minimum required contributions, with an allowance for discretionary contributions. In 2024, 2023 and 2022, the Company contributed $ 4.5 million, $ 9.0 million and $ 9.0 million, respectively, in pension contributions to this plan, which were in excess of the minimum required contributions. ​ The benefit formulas for employees who are members of collective bargaining units are determined according to the collective bargaining agreements, either using final average pay as the base, a flat dollar amount per year of service, or a cash balance formula. ​ Effective December 31, 2011, the Company froze benefit accruals under the final average pay formula for salaried, non-bargaining unit employees hired before January 1, 2008 and transitioned them to the same cash balance formula for 68 Table of Contents employees hired on or after January 1, 2008. Retirement benefits under the cash balance formula are based on a fixed percentage of employee eligible compensation, plus interest. The plan interest credit rate will vary from year to year based on the ten-year U.S. Treasury rate. ​ Effective December 31, 2022, the Matson Pension Plan for Clerical Bargaining Unit Employees was merged into the Retirement Plan for Employees of Matson. ​ Benefit Plan Assets and Obligations: The measurement date for the Company’s benefit plan disclosures is December 31 of each year. The status of the funded qualified defined benefit pension plan and the unfunded post-retirement benefit plan at December 31, 2024 and 2023 are shown below: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Post-retirement ​ ​ Pension Benefits ​ Benefits ​ ​ December 31, ​ December 31, ​ (In millions) 2024 2023 2024 2023 Change in Benefit Obligation: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Benefit obligation at beginning of year ​ $ 193.1 ​ $ 187.4 ​ $ 19.5 ​ $ 15.3 ​ Service cost ​ 3.7 ​ 3.1 ​ 0.2 ​ 0.2 ​ Interest cost ​ 9.7 ​ 10.0 ​ 1.0 ​ 0.8 ​ Participant contributions ​ — ​ — ​ 0.6 ​ 0.7 ​ Actuarial loss (gain) ​ ( 1.2 ) ​ 5.5 ​ ( 0.6 ) ​ 4.5 ​ Benefits paid, net of subsidies received ​ ( 13.1 ) ​ ( 12.9 ) ​ ( 2.3 ) ​ ( 2.0 ) ​ Benefit obligation at end of year ​ ​ 192.2 ​ ​ 193.1 ​ ​ 18.4 ​ ​ 19.5 ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Change in Plan Assets: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Fair value of plan assets at beginning of year ​ ​ 227.9 ​ ​ 206.3 ​ ​ — ​ ​ — ​ Actual return on plan assets ​ 21.9 ​ 25.5 ​ — ​ — ​ Participant contributions ​ — ​ — ​ 0.6 ​ 0.7 ​ Employer contributions ​ 4.5 ​ 9.0 ​ 1.7 ​ 1.3 ​ Benefits paid, net of subsidies received ​ ( 13.1 ) ​ ( 12.9 ) ​ ( 2.3 ) ​ ( 2.0 ) ​ Fair value of plan assets at end of year ​ 241.2 ​ 227.9 ​ — ​ — ​ Funded Status and Recognized Plan Assets and Benefit Obligations ​ $ 49.0 ​ $ 34.8 ​ $ ( 18.4 ) ​ $ ( 19.5 ) ​ ​ Qualified pension and post-retirement benefit plan assets and liabilities recognized in the Consolidated Balance Sheets and expenses recognized in accumulated other comprehensive income (loss) at December 31, 2024 and 2023 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Post-retirement ​ ​ Pension Benefits ​ Benefits ​ ​ December 31, ​ December 31, ​ (In millions) 2024 2023 2024 2023 Non-current assets ​ $ 49.0 ​ $ 34.8 ​ $ — ​ $ — ​ Current liabilities ​ ​ — ​ ​ — ​ ​ ( 1.1 ) ​ ​ ( 1.1 ) ​ Non-current liabilities ​ — ​ — ​ ( 17.3 ) ​ ( 18.4 ) ​ Total ​ $ 49.0 ​ $ 34.8 ​ $ ( 18.4 ) ​ $ ( 19.5 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net (loss) gain, net of taxes ​ $ ( 14.0 ) ​ $ ( 20.3 ) ​ $ 2.5 ​ $ 2.7 ​ Prior service credit, net of taxes ​ — ​ — ​ 5.6 ​ 8.3 ​ Total ​ $ ( 14.0 ) ​ $ ( 20.3 ) ​ $ 8.1 ​ $ 11.0 ​ ​ Unrecognized gains and losses of the post-retirement benefit plans are amortized over five years . Although current health care costs are expected to increase, the Company attempts to mitigate these increases by maintaining caps on certain of its benefit plans, using lower cost health care plan options where possible, requiring that certain groups of employees pay a portion of their benefit costs, self-insuring for certain insurance plans, encouraging wellness programs for employees, and implementing measures to mitigate future benefit cost increases. ​ 69 Table of Contents Components of the net periodic benefit cost and other amounts recognized in other comprehensive income (loss) for the qualified pension plan and the post-retirement benefit plan during 2024, 2023 and 2022 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension Benefits ​ Post-retirement Benefits ​ ​ December 31, ​ December 31, ​ (In millions) 2024 2023 2022 2024 2023 2022 Components of Net Periodic Benefit Cost (Credit): ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Service cost ​ $ 3.7 ​ $ 3.1 ​ $ 4.8 ​ $ 0.2 ​ $ 0.2 ​ $ 0.7 ​ Interest cost ​ 9.7 ​ 10.0 ​ 7.0 ​ 1.0 ​ 0.8 ​ 0.8 ​ Expected return on plan assets ​ ( 15.1 ) ​ ( 13.9 ) ​ ( 16.0 ) ​ — ​ — ​ — ​ Amortization of net actuarial loss (gain) ​ 0.4 ​ 1.3 ​ 2.4 ​ ( 0.8 ) ​ ( 2.0 ) ​ 0.8 ​ Amortization of prior service credit ​ — ​ — ​ ( 1.0 ) ​ ( 3.7 ) ​ ( 3.7 ) ​ ( 3.6 ) ​ Net periodic benefit cost (credit) ​ ​ ( 1.3 ) ​ ​ 0.5 ​ ​ ( 2.8 ) ​ ​ ( 3.3 ) ​ ​ ( 4.7 ) ​ ​ ( 1.3 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income, net of tax: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Net (gain) loss ​ ​ ( 6.0 ) ​ ​ ( 4.5 ) ​ ​ ( 12.3 ) ​ ​ ( 0.5 ) ​ ​ 3.4 ​ ​ ( 10.7 ) ​ Amortization of net actuarial (loss) gain ​ ( 0.3 ) ​ ( 1.0 ) ​ ( 1.8 ) ​ 0.6 ​ 1.5 ​ ( 0.6 ) ​ Amortization of prior service credit ​ — ​ — ​ 0.8 ​ 2.8 ​ 2.8 ​ 2.7 ​ Total recognized in other comprehensive (income) loss ​ ​ ( 6.3 ) ​ ​ ( 5.5 ) ​ ​ ( 13.3 ) ​ ​ 2.9 ​ ​ 7.7 ​ ​ ( 8.6 ) ​ Total recognized in net periodic benefit cost and other comprehensive (income) loss ​ $ ( 7.6 ) ​ $ ( 5.0 ) ​ $ ( 16.1 ) ​ $ ( 0.4 ) ​ $ 3.0 ​ $ ( 9.9 ) ​ ​ The weighted average assumptions used to determine benefit information during 2024, 2023 and 2022 were as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension Benefits ​ Post-retirement Benefits ​ ​ December 31, ​ December 31, ​ ​ 2024 2023 2022 2024 2023 2022 Discount rate (1) 5.60 % 5.30 % 5.60 % 5.60 % 5.40 % 5.50 % Expected return on plan assets 6.85 % 6.85 % 6.75 % ​ ​ ​ ​ ​ ​ Rate of compensation increase 3.50 % 3.50 % 4.00 % - 3.50 % 3.50 % 3.50 % 4.00 % - 3.50 % Cash balance interest credit rate ​ 3.90 % - 4.42 % 4.50 % - 3.25 % 3.50 % - 3.25 % ​ ​ ​ ​ ​ ​ Immediate health care cost trend rate: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pre-65 group ​ ​ ​ ​ ​ ​ ​ 6.30 % 6.80 % 6.60 % Post-65 group ​ ​ ​ ​ ​ ​ ​ 6.50 % 7.10 % 6.10 % Ultimate health care cost trend rate ​ ​ ​ ​ ​ ​ ​ 3.90 % 3.90 % 4.00 % Year ultimate health care cost trend rate is reached ​ ​ ​ ​ ​ ​ ​ 2048 ​ 2048 ​ 2046 ​ (1) The Company derives a single equivalent rate utilizing a yield curve constructed from a portfolio of high-quality corporate bonds with various maturities. ​ Non-qualified Pension Plans: 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 law. A few employees and retirees receive additional supplemental pension benefits. Non-qualified pension plan liabilities recognized in the Consolidated Balance Sheets and expenses recognized in accumulated other comprehensive income (loss) at December 31, 2024 and 2023 are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non-qualified ​ Pension Benefits ​ December 31, ​ (In millions) ​ 2024 2023 Current liabilities ​ $ ( 0.4 ) ​ $ ( 1.2 ) ​ Non-current liabilities ​ ​ ( 4.0 ) ​ ​ ( 3.4 ) ​ Total ​ $ ( 4.4 ) ​ $ ( 4.6 ) ​ ​ ​ ​ ​ ​ ​ ​ ​ Net (loss), net of taxes ​ $ ( 0.4 ) ​ $ ( 0.2 ) ​ Total ​ $ ( 0.4 ) ​ $ ( 0.2 ) ​ ​ 70 Table of Contents Discount rates of 5.4 percent and 5.2 percent were used in determining the 2024 and 2023 non-qualified pension plan obligations, respectively. ​ Estimated Benefit Payments: The estimated future benefit payments for the next ten years consist of the following as of December 31, 2024: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non-qualified ​ ​ ​ ​ Pension ​ Pension ​ Post-retirement ​ Year (in millions) ​ Benefits ​ Benefits ​ Benefits (1) 2025 ​ $ 15.3 ​ $ 0.4 ​ $ 1.1 ​ 2026 ​ 15.3 ​ 0.5 ​ 1.1 ​ 2027 ​ 15.8 ​ 0.5 ​ 1.1 ​ 2028 ​ 16.2 ​ 0.5 ​ 1.1 ​ 2029 ​ 16.1 ​ 0.7 ​ 1.1 ​ 2030-2034 ​ ​ 80.1 ​ ​ 2.7 ​ ​ 5.7 ​ Total ​ $ 158.8 ​ $ 5.3 ​ $ 11.2 ​ (1) Net of participant contributions and Medicare Part D subsidies. ​ Defined Contribution Plans: The Company sponsors defined contribution plans that qualify under Sections 401(a) and 401(k) of the Internal Revenue Code. The Company may make discretionary matching contributions equal to a specified percentage of each participant’s 401(k) contributions and makes other non-discretionary contributions. For the year ended December 31, 2024, the Company provided employees with discretionary matching contributions of up to 3 percent of eligible employee compensation, and for a select group of employees, up to 4 percent of eligible employee compensation. The Company’s matching contributions and other contributions expensed in 2024, 2023 and 2022 were $ 4.6 million, $ 4.2 million and $ 3.6 million, respectively. ​ The Company may also provide a discretionary profit sharing contribution under the qualified defined contribution plans to non-bargaining unit employees, if both a minimum threshold of Company performance is achieved and the Board of Directors has approved the profit sharing contribution. For certain eligible employees, supplemental profit sharing contributions are credited under a non-qualified plan to be paid after separation from service from the Company’s general funds so that total profit sharing contributions would be substantially equal to amounts that would have been contributed to the Company’s qualified defined contribution plans if it were not for limitations imposed by income tax law. Discretionary profit sharing contributions expensed in 2024, 2023 and 2022 were $ 3.1 million, $ 3.1 million and $ 2.8 million, respectively. ​ Multi-employer Bargaining Plans: ​ The Company contributes to multi-employer defined benefit pension plans under the terms of collective-bargaining agreements that cover its bargaining unit employees. Contributions are generally based on amounts paid for union labor or cargo volume. The risks of participating in multi-employer plans are different from single employer plans because assets contributed to the multi-employer plan by one employer may be used to provide benefits to employees of other participating employers. Additionally, if one employer stops contributing to the plan, the unfunded obligations of the plan may be borne by the remaining participating employers. ​ The multi-employer pension plans are subject to the plan termination insurance provisions of ERISA and are paying premiums to the Pension Benefit Guaranty Corporation (“PBGC”). The statutes provide that an employer who 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. As of December 31, 2024, the Company’s estimated benefit plan withdrawal obligations were $ 155.5 million. Except as described in Note 12, no withdrawal obligations have been recorded by the Company in the Consolidated Balance Sheets at December 31, 2024 and 2023, as the Company has no present intention of withdrawing from and does not anticipate termination of any of these plans. ​ Information regarding the Company’s participation in multi-employer pension plans is outlined in the table below. The “EIN/Pension Plan Number” column provides the Employer Identification Number (“EIN”) and the three-digit plan number, if applicable. Unless otherwise noted, the most recent Pension Protection Act zone status available in 2024 and 2023 is for the plan’s year-end at December 31, 2024 and 2023, respectively. The zone status is based on information that the Company received from the plan and is certified by the plan’s actuary. Among other factors, plans in the red 71 Table of Contents zone are generally less than 65 percent funded; plans in the orange zone are both a) less than 80 percent funded and b) have an accumulated/expected funding deficiency in any of the next six plan years, net of any amortization extensions; plans in the yellow zone meet either one of the criteria mentioned in the orange zone; and plans in the green zone are at least 80 percent funded. The funding improvement plan (“FIP”) or rehabilitation plan (“RP”) column indicates the status which is either pending or has been implemented. The last column lists the expiration dates of the collective-bargaining agreements to which the plans are subject. ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Pension ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Protection Act ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Zone as of ​ FIP/RP Status ​ 5% ​ Contributions of Matson ​ ​ ​ ​ ​ ​ EIN/Pension ​ ​ ​ December 31, ​ Pending/ ​ Contributor ​ (in millions) ​ Surcharge ​ Expiration Pension Funds Plan Number Notes 2024 2023 Implemented in 2024 2024 2023 2022 Imposed Date (1) American Radio Association Pension Fund 13-6161999-001 ​ ​ Green Green Implemented ​ Yes ​ $ 1.0 ​ $ 1.0 ​ $ 1.1 No 6/15/2028 ​ Hawaii Longshore Pension Plan ​ 99-0314293-001 ​ ​ ​ Green ​ Green ​ No ​ Yes ​ ​ 12.9 ​ ​ 12.1 ​ ​ 11.9 ​ No ​ 6/30/2028 ​ Master, Mates and Pilots Pension Plan 13-6372630-001 ​ ​ ​ Green Green No ​ Yes ​ 3.7 ​ 3.6 ​ 3.8 No ​ 6/15/2027, ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 6/15/2028 ​ Masters, Mates and Pilots Adjustable Pension Plan 37-1719247-001 ​ ​ ​ Green Green No ​ Yes ​ 2.1 ​ 2.0 ​ 2.1 No ​ 6/15/2027, ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 6/15/2028 ​ MEBA Pension Trust - Defined Benefit Plan 51-6029896-001 ​ ​ ​ Green Green No ​ Yes ​ 4.6 ​ 4.2 ​ 4.5 No 6/15/2028 ​ OCU Pension Trust Plan 26-1574440-001 ​ ​ ​ Green Green No ​ No ​ 0.6 ​ 0.4 ​ 0.5 No 6/30/2030 ​ MFOW Supplementary Pension Plan ​ 94-6201677-001 ​ ​ ​ Yellow ​ Yellow ​ No ​ Yes ​ ​ 0.1 ​ ​ 0.1 ​ ​ 0.1 ​ No ​ 6/30/2026 ​ SIU Pacific District Pension Plan ​ 94-6061923-001 ​ ​ ​ Green ​ Green ​ No ​ Yes ​ ​ 1.3 ​ ​ 1.3 ​ ​ 1.5 ​ No ​ 6/30/2026 ​ Alaska Teamster - Employer Pension Plan ​ 92-6003463-024 ​ ​ ​ Red ​ Red ​ Implemented ​ Yes ​ ​ 3.8 ​ ​ 3.9 ​ ​ 4.0 ​ No ​ 6/30/2025, ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 6/30/2026, ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 6/30/2027, ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ 6/30/2028 ​ All Alaska Longshore Pension Plan ​ 91-6085352-001 ​ ​ ​ Green ​ Green ​ No ​ Yes ​ ​ 2.2 ​ ​ 1.8 ​ ​ 2.0 ​ No ​ 6/30/2028 ​ Western Conference of Teamsters Pension Plan ​ 91-6145047-001 ​ ​ ​ Green ​ Green ​ No ​ No ​ ​ 2.3 ​ ​ 2.1 ​ ​ 2.1 ​ No ​ 3/31/2028 ​ Western Conference of Teamsters Supplemental Benefit Trust ​ 95-3746907-001 ​ ​ ​ Green ​ Green ​ No ​ No ​ ​ 0.1 ​ ​ 0.1 ​ ​ 0.1 ​ No ​ 3/31/2028 ​ OPEIU Local 153 Pension Plan ​ 13-2864289-001 ​ ​ ​ Red ​ Red ​ Implemented ​ No ​ ​ 0.1 ​ ​ 0.1 ​ ​ 0.1 ​ No ​ 11/9/2028 ​ Seafarers Pension Plan ​ 13-6100329-001 ​ (2) ​ Green ​ Green ​ No ​ No ​ ​ — ​ ​ — ​ ​ — ​ No ​ 6/30/2027 ​ Total ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ $ 34.8 ​ $ 32.7 ​ $ 33.8 ​ ​ ​ ​ ​ (1) Represents the expiration date of the collective bargaining agreement. (2) The Company does not make contributions directly to the Seafarers Pension Plan. Instead, contributions are made to the Seafarers Health and Benefits Plan, and are subsequently re-allocated to the Seafarers Pension Plan at the discretion of the plan Trustees. ​ The Company also contributes to multi-employer plans that provide post-retirement health and other benefits other than pensions under the terms of collective-bargaining agreements. Benefits provided to active and retired employees and their eligible dependents under these plans include medical, dental, vision and prescription drugs. These plans are not subject to the PBGC plan termination and withdrawal liability provisions of ERISA applicable to multi-employer defined benefit pension plans. Contributions made to these plans were $ 41.2 million, $ 37.7 million and $ 37.7 million in 2024, 2023 and 2022, respectively. ​ Multi-employer Defined Contribution Plans: The Company contributes to six multi-employer defined contribution pension plans. These plans are not subject to the withdrawal liability provisions of ERISA or the PBGC applicable to multi-employer defined benefit pension plans. Contributions made to these plans by the Company were $ 6.0 million, $ 5.7 million and $ 6.0 million in 2024, 2023 and 2022, respectively. ​ ​ 72 Table of Contents 12. MULTI-EMPLOYER WITHDRAWAL LIABILITIES ​ Horizon ceased all of its operations in Puerto Rico during the first quarter of 2015, which resulted in a mass withdrawal from its multi-employer ILA-PRSSA pension fund. The Company assumed this liability as part of the acquisition of Horizon on May 29, 2015. The Company estimated the mass withdrawal liability based upon the required undiscounted quarterly payment of approximately $ 1.0 million to be paid to the ILA-PRSSA pension fund over a period which ends in March 2040, discounted to present value using the Company’s incremental borrowing rate. Future estimated annual payments to be paid to the ILA-PRSSA pension fund as of December 31, 2024 were as follows: ​ ​ ​ ​ ​ Year (in millions) ​ Total 2025 $ 4.1 2026 ​ ​ 4.1 2027 ​ ​ 4.1 2028 ​ ​ 4.1 2029 ​ ​ 4.1 Thereafter ​ ​ 43.1 Total remaining future undiscounted payments due to the ILA-PRSSA pension fund ​ ​ 63.6 Less: amount representing interest ​ ​ ( 15.3 ) Present value of multi-employer withdrawal liability ​ ​ 48.3 Current portion of multi-employer withdrawal liability (see Note 2) ​ ​ ( 4.1 ) Long-term portion of multi-employer withdrawal liability (see Note 2) $ 44.2 ​ ​ ​ ​ 13. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) ​ Changes in accumulated other comprehensive income (loss) by component, net of tax, consist of the following for the years ended December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Non- ​ ​ Accumulated ​ ​ ​ ​ ​ Post- ​ Qualified ​ ​ ​ ​ Other ​ ​ Pension ​ Retirement ​ Pension ​ ​ ​ ​ Comprehensive (In millions) ​ Benefits ​ Benefits ​ Benefits ​ Other ​ Income (Loss) Balance at December 31, 2022 ​ $ ( 25.8 ) ​ $ 18.7 ​ $ 0.1 ​ $ 0.1 ​ $ ( 6.9 ) ​ Amortization of prior service cost ​ — ​ ​ ( 2.8 ) ​ ​ — ​ ​ — ​ ( 2.8 ) ​ Amortization of net gain (loss) ​ ​ 5.5 ​ ​ ( 4.9 ) ​ ​ ( 0.3 ) ​ ​ — ​ 0.3 ​ Foreign currency exchange ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 0.5 ) ​ ​ ( 0.5 ) ​ Other adjustments ​ ​ — ​ ​ — ​ ​ — ​ ​ 1.7 ​ 1.7 ​ Balance at December 31, 2023 ​ ( 20.3 ) ​ 11.0 ​ ( 0.2 ) ​ 1.3 ​ ( 8.2 ) ​ Amortization of prior service cost ​ — ​ ​ ( 2.8 ) ​ ​ — ​ ​ — ​ ( 2.8 ) ​ Amortization of net gain (loss) ​ 6.3 ​ ​ ( 0.1 ) ​ ​ ( 0.2 ) ​ ​ — ​ 6.0 ​ Foreign currency exchange ​ ​ — ​ ​ — ​ ​ — ​ ​ ( 1.9 ) ​ ​ ( 1.9 ) ​ Other adjustments ​ — ​ ​ — ​ ​ — ​ ​ 0.4 ​ 0.4 ​ Balance at December 31, 2024 ​ $ ( 14.0 ) ​ $ 8.1 ​ $ ( 0.4 ) ​ $ ( 0.2 ) ​ $ ( 6.5 ) ​ ​ Other comprehensive income (loss) in the Consolidated Statements of Income and Comprehensive Income is shown net of tax benefit (expense) of $( 2.5 ) million, $( 1.2 ) million and $( 9.3 ) million for the years ended December 2024, 2023 and 2022, respectively. ​ ​ 73 Table of Contents ​ 14. EARNINGS PER SHARE ​ Basic earnings per share are determined by dividing net income by the weighted-average common shares outstanding during the year. The calculation of diluted earnings per share includes the dilutive effect of unvested restricted stock units. The computation of weighted average common shares excluded a nominal amount of anti-dilutive restricted stock units for each of the years 2024, 2023 and 2022. ​ The computations for basic and diluted earnings per share for the years ended December 31, 2024, 2023 and 2022 are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Year Ended December 31, 2024 ​ Year Ended December 31, 2023 ​ Year Ended December 31, 2022 ​ ​ ​ Weighted Per ​ ​ Weighted Per ​ ​ Weighted Per ​ ​ ​ ​ ​ Average ​ Common ​ ​ ​ ​ Average ​ Common ​ ​ ​ ​ Average ​ Common ​ ​ Net ​ Common ​ Share ​ Net ​ Common ​ Share ​ Net ​ Common ​ Share (In millions, except per share amounts) ​ Income ​ Shares ​ Amount ​ Income ​ Shares ​ Amount ​ Income ​ Shares ​ Amount Basic: ​ $ 476.4 33.7 ​ $ 14.14 ​ $ 297.1 35.3 ​ $ 8.42 ​ $ 1,063.9 39.0 ​ $ 27.28 Effect of Dilutive Securities: ​ ​ — 0.5 ​ ​ ( 0.21 ) ​ ​ — 0.4 ​ ​ ( 0.10 ) ​ ​ — 0.3 ​ ​ ( 0.21 ) Diluted: ​ $ 476.4 ​ 34.2 ​ $ 13.93 ​ $ 297.1 ​ 35.7 ​ $ 8.32 ​ $ 1,063.9 ​ 39.3 ​ $ 27.07 ​ ​ ​ 15. SHARE-BASED AWARDS ​ The Company has share-based compensation plans which are described as follows: ​ 2016 Incentive Compensation Plan: The Amended and Restated Matson, Inc. 2016 Incentive Compensation Plan (the “2016 Plan”) serves as a successor to the 2007 Incentive Compensation Plan and all other predecessor plans. No further grants were made under the predecessor stock option plans. Under the 2016 Plan, 4.35 million shares of common stock were reserved for issuance. ​ The 2016 Plan consists of four separate incentive compensation programs: (i) the discretionary grant program, (ii) the stock issuance program, (iii) the incentive bonus program, and (iv) the automatic grant program for the non- employee members of the Company’s Board of Directors. Share-based compensation is generally awarded under three of the four programs, as more fully described below. ​ Discretionary Grant Program — Under the Discretionary Grant Program, stock options may be granted with an exercise price no less than 100 percent of the fair market value (defined as the closing market price) of the Company’s common stock on the date of the grant. No stock options have been granted under the 2016 Plan. ​ Stock Issuance Program — Under the Stock Issuance Program, shares of common stock, restricted stock units or performance shares may be granted. Time-based equity awards generally vest ratably over three years . Provided certain three-year performance targets are achieved, performance-based equity awards generally vest on the three-year anniversary date of the grant. ​ Automatic Grant Program — At each annual shareholder meeting, non-employee directors will receive an award of restricted stock units that entitle the holder to an equivalent number of shares of common stock upon vesting, under the Automatic Grant Program. Awards of restricted stock units granted under the program generally vest on the one-year anniversary of the grant date. ​ The shares of common stock authorized to be issued under the 2016 Plan may be drawn from shares of the Company’s authorized but unissued common stock or from shares of its common stock that the Company acquires, including shares purchased on the open market or in private transactions. ​ Share-based compensation expense and other information related to share-based awards for the years ended December 31, 2024, 2023 and 2022 are as follows: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Years Ended December 31, Share-based compensation expense, net of estimated forfeitures (in millions) 2024 2023 2022 Share-based compensation expense ​ $ 26.5 ​ $ 23.8 ​ $ 18.3 ​ Tax benefit realized upon stock vesting ​ $ 5.6 ​ $ 6.1 ​ $ 10.6 ​ Fair value of stock vested ​ $ 25.6 ​ $ 27.8 ​ $ 44.0 ​ ​ 74 Table of Contents As of December 31, 2024, unrecognized compensation cost related to non-vested restricted stock units and performance-based equity awards was $ 24.5 million. Unrecognized compensation cost is expected to be recognized over a weighted average period of approximately 1.7 years. ​ The following table summarizes non-vested restricted stock unit activity through December 31, 2024 (in thousands, except weighted average grant-date fair value amounts): ​ ​ ​ ​ ​ ​ ​ ​ 2016 Plan Weighted ​ ​ Restricted ​ Average Grant- ​ ​ ​ Stock Units ​ Date Fair Value Outstanding at December 31, 2023 533 $ 75.82 ​ Granted ​ 153 ​ $ 122.23 ​ Vested ​ ( 352 ) ​ $ 72.71 ​ Canceled ​ ( 5 ) ​ $ 85.27 ​ Added by performance factor (1) ​ 119 ​ $ 122.35 ​ Outstanding at December 31, 2024 448 $ 93.83 ​ (1) Represents shares paid out above target. ​ ​ 16. FAIR VALUE OF FINANCIAL INSTRUMENTS ​ The Company values its financial instruments based on the fair value hierarchy of valuation techniques for fair value measurements. Level 1 inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. Level 2 inputs include quoted prices for similar assets and liabilities in active markets and inputs other than quoted prices observable for the asset or liability. Level 3 inputs are unobservable inputs for the asset or liability. If the technique used to measure fair value includes inputs from multiple levels of the fair value hierarchy, the lowest level of significant input determines the placement of the entire fair value measurement in the hierarchy. ​ The Company uses Level 1 inputs for the fair values of its cash and cash equivalents, restricted cash and cash on deposit, and investments in the CCF, and Level 2 inputs for its fixed rate debt. The fair values of cash and cash equivalents, restricted cash and cash on deposit in the CCF approximate their carrying values due to the nature of the instruments. The fair value of fixed rate debt is calculated based upon interest rates available for debt with terms and maturities similar to the Company’s existing debt arrangements. ​ The carrying value and fair value of the Company’s financial instruments consists of the following as of December 31, 2024 and 2023: ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ Quoted Prices in ​ Significant ​ Significant ​ ​ ​ Total ​ ​ ​ Active Markets ​ Observable ​ Unobservable ​ ​ Carrying Value Total (Level 1) Inputs (Level 2) Inputs (Level 3) ​ (In millions) ​ December 31, 2024 ​ Fair Value Measurements at December 31, 2024 ​ Cash and cash equivalents ​ $ 266.8 ​ $ 266.8 ​ $ 266.8 ​ $ — ​ $ — ​ Restricted cash ​ $ — ​ $ — ​ $ — ​ $ — ​ $ — ​ CCF - Cash and cash equivalent ​ $ 230.7 ​ $ 230.7 ​ $ 230.7 ​ $ — ​ $ — ​ CCF - Investments ​ $ 411.9 ​ $ 412.5 ​ $ 412.5 ​ $ — ​ $ — ​ Fixed rate debt ​ $ 400.9 ​ $ 317.7 ​ $ — ​ $ 317.7 ​ $ — ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ ​ (In millions) December 31, 2023 ​ Fair Value Measurements at December 31, 2023 ​ Cash and cash equivalents ​ $ 134.0 ​ $ 134.0 $ 134.0 ​ $ — ​ $ — ​ Restricted cash ​ $ 2.3 ​ $ 2.3 ​ $ 2.3 ​ $ — ​ $ — ​ CCF - Cash and cash equivalent ​ $ 599.4 ​ $ 599.4 ​ $ 599.4 ​ $ — ​ $ — ​ Fixed rate debt ​ $ 440.6 ​ $ 359.9 ​ $ — ​ $ 359.9 ​ $ — ​ ​ ​ ​ ​ ​ 75 Table of Contents 17. COMMITMENTS AND CONTINGENCIES ​ Commitments: Commitments and contractual obligations, excluding debt obligations (see Note 8), lease commitments (see Note 9), pension and post-retirement plan obligations (see Note 11), and multi-employer withdrawal liabilities (see Note 12), are as follows as of December 31, 2024: ​ ​ ​ ​ ​ ​ Commitments and Contractual Obligations (in millions) Total Standby letters of credit (1) ​ $ 6.1 ​ Bonds (2) ​ $ 65.1 ​ Vessel construction obligations (3) ​ $ 814.0 ​ Vendor and other obligations (4) ​ $ 214.6 ​ (1) Standby letters of credit are required for the Company’s uninsured workers’ compensation and other insurance programs, and other needs. (2) Bonds are required for U.S. Customs and other related matters. (3) Vessel construction obligations represent remaining contractual obligations entered into for the construction of three new Jones Act vessels. (4) Vendor and other obligations include: (i) non-cancellable contractual capital project obligations; (ii) dry-docking related obligations; and (iii) other contractual obligations. Amounts are considered obligations if a contract has been agreed to specifying significant terms of the contract, and the amounts are not reflected in the Consolidated Balance Sheets as of December 31, 2024. ​ These amounts are not recorded on the Company’s Consolidated Balance Sheet as of December 31, 2024 and it is not expected that the Company or its subsidiaries will be called upon to advance funds under these commitments and contractual obligations. ​ Contingencies: Contingencies and other litigation related matters are described as follows: ​ ● Environmental Matters: The Company faces certain risks that could result in material expenditures related to environmental remediation. The Company believes, that based on all information currently available to it, the Company is currently in compliance, in all material respects, with applicable environmental laws and regulations. ​ ● Other Matters: The Company and its subsidiaries are parties to, or may be contingently liable in connection with, other legal actions arising in the normal course of their businesses, the outcomes of which, in the opinion of management after consultation with counsel, would not have a material effect on the Company’s financial condition, results of operations, or cash flows. ​ ​ ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE ​ None. ​ ​