Mainland business
helps net at Castle

The company also pares
Lanai losses

By Russ Lynch
Star-Bulletin

Boosted by home and house-lot sales on the mainland and lower losses at its Lanai resort operations, second-quarter profits at Castle & Cooke Inc. were double those of the year-earlier quarter.

The Los Angeles-based company today reported a net profit of $2.6 million for the quarter ended June 30, compared with a profit of $1.3 million in the 1997 quarter. The latest profit was equal to 13 cents a share.

In the year-earlier period, dividends of $1.05 million to holders of preferred stock cut the per-share income for common shareholders to 1 cent a share. There was no preferred stock dividends in the 1998 quarter.

Second-quarter revenues of $69.5 million were up 26 percent from $55.1 million in 1997.

The company's Oahu residential projects recorded a slight increase in new orders compared with sales in the 1997 quarter, said David H. Murdock, chairman and chief executive officer. However, "we continue to be concerned with the negative impact the Asian economic crisis will have on the already sluggish Hawaii economy," he said.

Castle & Cooke's stock fell $1.69 to close at $17.31 today on the New York Stock Exchange.

The company got new orders for 106 Oahu homes in the latest quarter and delivered 93 homes that were sold earlier at an average price of $270,000. In the 1997 quarter, the company had 102 new Oahu orders and delivered 86 homes sold earlier for an average of $259,000.

On the mainland, the company took orders for seven homes and delivered four for an average of $107,000. In the year-earlier period there were new orders for three mainland homes and deliveries of two at an average of $85,000.

A far bigger part of Castle & Cooke's mainland business is the sale of house lots. In the latest quarter, the company took orders for 149 lots and delivered 275 for an average of $34,000. There were 126 new house-lot orders in the 1997 quarter and 188 deliveries at an average of $21,000.

At its resort hotels on Lanai, the company had a second-quarter operating loss of $1.3 million, but that was half the loss of $2.6 million in the year-earlier quarter. Castle & Cooke also had an operating profit of $2.2 million in the latest quarter from selling luxury homes on Lanai, up from $841,000 in the 1997 quarter. The company said it has sales contracts for eight townhouses at Manele Bay for an average of $1.2 million each.

After subtracting depreciation, the company's total Lanai business had an operating loss of $1.5 million in the 1998 quarter, compared with a loss of $3.3 million in the year-earlier period.