Suzy Hollinger – Director-Investor Relations Stan Kuriyama – Chairman and Chief Executive Officer Chris Benjamin – President and Chief Operating Officer George Morvis – Vice President, Corporate Development Paul Ito – Senior Vice President, Chief Financial Officer and Treasurer Lance Parker – President David Haverly – Senior Vice President.

McGrath – Evercore Steve OHara – Sidoti Wilkes Graham – Compass Point.

Good day, ladies and gentlemen, and welcome to the Q3 2015 Alexander & Baldwin Earnings Conference Call. My name is Steve, and I’ll be your operator for today. At this time, all participants are in listen-only mode. We will conduct a question-and-answer session towards the end of this conference.

[Operator Instructions] As a reminder, this call is being recorded for replay purposes. I would now like to turn the call over to Ms. Suzy Hollinger, Director of Investor Relations. Please proceed.

Thank you, Steve. Aloha and welcome to Alexander & Baldwin’s third-quarter 2015 earnings call. On the call with me today are Stan Kuriyama, Chairman and CEO; Chris Benjamin, President and COO; George Morvis, Vice President, Corporate Development; and Paul Ito, Senior Vice President and CFO.

Also with us today from A&B Properties are Lance Parker, President, and David Haverly, Senior Vice President of Leasing, who will participate in the question-and-answer portion of the call.

Before we commence, please note that statements in this call and presentation that are not historical facts are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that involve a number of risks and uncertainties that could cause actual results to differ materially from those contemplated by the relevant forward-looking statements.

Factors that could cause actual results to differ materially from those contemplated in the statements include without limitation those described on pages 17 to 30 of the Company’s 2014 annual report on Form 10-K, excuse me, and in other subsequent filings with the SEC.

These forward-looking statements are not a guarantee of future performance and we do not undertake any obligation to update our forward-looking statements. Management will be referring to non-GAAP financial measures when discussing results.

In particular, we will be referring to NOI when discussing leasing segment results and EBITDA when discussing performance of the Materials and Construction segment. Included in the appendix of today’s presentation slides is a statement regarding our use of these non-GAAP financial measures and required reconciliations.

Slides from this presentation are available for download at our website, alexanderbaldwin.com. Slide three presents an agenda for today’s presentation after which we will take your questions. We will start with Stan who will comment on results and review highlights..

Thank you, Suzy, and good afternoon everyone. As noted in our release, the Company reported third quarter earnings of $7 million or $0.11 a share, which included an agribusiness after-tax loss of $6 million. Results were driven by continued strength in our real estate operations.

Our development and sales segment posted operating profit of $11 million and leasing continues to perform well with a 7% improvement in net operating income in the third quarter compared to last year. Our Materials and Construction segment generated $10 million of EBITDA and backlog at the end of September was a healthy $243 million.

Agribusiness incurred a greater than expected loss in the quarter which we will discuss in more detail later. Hawaii’s economy remains strong. Visitor arrivals were up 4% and expenditures were up 3% through September on pace for a fourth consecutive record year. Construction is picking up significantly.

The value of statewide private sector construction permits was up 32% year to date through August compared to last year led by an increase in commercial and residential permits. Tourism and the strengthening construction industry are driving improved performance across the broader Hawaii economy.

Unemployment for example was 3.4% at the end of September compared to 4.2% last year. Both bankruptcy filings and foreclosures were lower by 10% for the first nine months of the year compared to prior year. And First Hawaiian Bank reported that its debit and credit card same-store sales volume increased 6% for the third quarter compared to last year.

Oahu residential real estate continues to perform well. The median resale price for a single-family home in September was $730,000, the highest price in the state’s history. The median resale price for a condo unit increased 5.5% year-over-year to $366,000.

At the end of September, housing supply on Oahu stood at 3.2 months of available inventory for single-family homes and 3.5 months for condos. Median days on market were about 20 days for both homes and condos. Oahu’s commercial real estate markets are also performing well.

Retail asking rents climbed 8% in the third quarter compared to last year and vacancy was 3.7%, 60 basis points lower than last year. Vacancy for industrial space was even lower at 2.2% and asking rents increased 12% in the third quarter compared to last year. Office rents improved by 4% in the quarter and vacancy remained stable.

And with that, I would like to now ask first to update you on our real estate and agribusiness segments.

Chris?.

Thank you, Stan. Good afternoon and good evening to everybody listening. Real estate performed well in the third quarter, once again the strong sales activity and with growth in net operating income in our Hawaii commercial portfolio.

Starting on the development side, the 450 high-rise and mid-rise units at The Collection in urban Honolulu are completely sold out under binding contracts. The average price per square foot of the tower and mid-rise units is about $775 making this an attractive project for local buyers with 85% of contracted sales to local residents.

On the last call I told you that we had released for sale 14 townhomes, the last phase of the project. Of these, five are currently under contract at an average sales price of $1.85 million. Construction continues on schedule and we just poured the 16th floor of the tower.

Given the strong sales results we have experienced at The Collection, we remain positive on the urban Honolulu high-rise market especially the projects targeted at the local market.

We recently announced a $35 million investment in the form of B note financing provided for the development of Keauhou Place, a 423-unit high-rised project located in urban Honolulu, two blocks from The Collection. The project is 81% sold out under binding contracts and it broke ground last week.

Returns from this investment are expected to be commensurate with our equity investments in other condo projects but with a lower level of risk. Moving now to Maui, we are seeing continued sales interest at Maui Business Park driven by its great location as well as the opening of Maui’s first Target store earlier this year.

Year-to-date through October we have closed four parcels totaling 18.4 acres at an average price of $42 per square foot, which includes the 11 acres sold to Lowe’s in the third quarter. We look forward to their groundbreaking on a 167,000 square foot store early next year and expect them to be another strong anchor for this phase of our project.

Also on Maui, we are pleased to be advancing two important residential developments. Presales began in July for Keala ‘O Wailea, our 70-unit planned condominium project in the Wailea resort. 21 of the initial 30 units released for presale are under binding contract.

This success in early sales prompted the subsequent release of another 20 units for presale. Of these, seven units have already been sold under binding contract. Based on these strong presales, we anticipate commencing construction in December and delivering units in mid-2017.

We are also pleased to announce that last week the A&B Board approved the development of a master planned residential community in Kihei Maui called Kamalani, formerly referred to as Kihei Residential. This project is planned for 630 units comprising a mix of market and affordable townhomes and single-family homes.

The project will be developed on a 95 acre parcel that was re-zoned to residential use by A&B in 2014. We expect to break ground on Kamalani in early 2016 with delivery of the first units in late 2017. Moving on to KuKui’ula on Slide 15, ten custom lots and seven homes have closed year to date through October 31.

Prices for the custom lots averaged $1.2 million and the homes averaged $3.5 million. These year-to-date lot sales are a positive sign and indicate that more and more buyers are willing to design and build custom homes.

In fact, 10 members currently have homes under construction and there are 19 additional developer homes under construction through our various building initiatives. In addition to the 17 units sold this year through October, we currently have binding contracts for another 12 units in escrow, four of which are expected to close by year-end.

To further expand the range of our product offerings at KuKui’ula, civil construction of KuKui’ula’s newest neighborhood called Kainani is progressing well with subdivision improvements to the 26-acre parcel to be completed by the end of November.

Kainani will consist of 24 custom lots and a planned to 20-unit condominium project, all with ocean views. The positive momentum at KuKui’ula is carrying over to the shops at KuKui’ula, our 89,000 square foot resort retail center adjacent to the residential community.

The center is now 99% leased compared to 88% at this time last year and net operating income increased 26% through October compared to the same period last year. In October, a 10,000 square foot CVS drugstore opened at The Shops joining Eating House 1849 by Chef Roy Yamaguchi, which opened earlier in the year.

Both are adding to the significant appeal and draw of the center, which has become Kauai’s premier shopping and dining destination. Continuing now with the commercial portfolio on Slide 18, we reported $20.4 million of NOI in the third quarter, a 6.8% improvement over the third quarter of 2014.

The increase in net operating income was driven primarily by Kaka’ako Commerce Center and the Kailua portfolio as well as the aforementioned increase in NOI from The Shops at KuKui’ula. Third-quarter 2015 occupancy for the Hawaii and Mainland portfolios were 93% and 96% respectively compared to 94% for both portfolios for the third quarter of 2014.

Leasing NOI was up 7.5% for the first nine months of 2015 and the year-over-year growth rate is expected to continue at approximately that same pace for the balance of 2015. We continue to pursue the expansion of our commercial portfolio in Hawaii.

We are currently evaluating a few attractive properties and expect to announce an acquisition by the time of our next call. Let me now turn to agribusiness, were unfortunately we can’t catch a break. Hawaii just experienced its wettest summer in 30 years.

Rainfall in Central Maui in the third quarter was 300% of normal averages and the bad weather continued into the fourth quarter. These abnormal weather conditions hit our farming operations hard.

Three months ago we reported our full year agribusiness losses would be higher than last year and now we have matched last year’s losses through just three quarters. Rather than making up lost ground on production levels in the third quarter, the rainy weather has materially increased our production deficit.

To make matters far worse, the abnormally wet weather continued through October leading us to drop our full year production estimate even further and correspondingly increase our full year estimate of segment operating losses. We now believe they will be in the range of three times last year’s level.

To understand how our outlook could change so dramatically over a short time, it is important to note that we recognize costs throughout the year based on what we believe our full year cost per ton will be.

As production estimates fall due to bad weather, we have fewer tons of sugar over which to spread our high fixed costs, thereby raising our cost per ton. So not only do we lose more money on the sugar we are selling each successive quarter but we have to recognize additional costs in the quarter for sugar we have sold in previous quarters.

Consequently, revising our estimate of cost per ton higher can produce rapid escalation and losses especially if the estimate is revised late in the year as is the case this year.

We believe our current forecast adequately takes into account sustained bad weather but we always have to caveat it because of the unpredictability of various factors that impact the business. This financial result obviously is unacceptable, which makes it imperative that we implement changes. We are focused on two fronts.

First, we are pursuing discussions with a major customer to determine whether enhancements to our sugar offtake agreements can be achieved. And second, we are increasing the already significant resources dedicated to defining an alternative business model for our plantation.

We will announce the results of these efforts no later than our next earnings call. With that, let me turn the call over to George to discuss our Materials & Construction results..

Thanks, Chris. Our Materials & Construction segment reported $7.5 million of operating profit and $10.2 million of earnings before interest, taxes, depreciation and amortization or EBITDA for the third quarter of 2015.

Both of the measures increased compared to the third quarter of 2014 due to increased aggregate and other construction related materials sales and as it relates to the increase in operating profit, lower depreciation and amortization. The segment’s longer-term prospects remain very positive.

Grace’s backlog although modestly lower than at the end of June, was a solid $243 million at September 30. Segment financial performance for the balance of the year will largely be dictated by the percentage of this backlog we can complete by year-end as most pending activity from now until that time is for work that will not commence until 2016.

Before turning the call over to Paul to discuss financial matters, let me also take a minute to update you on our energy businesses on Slide 22. Most of you already know that we are a significant producer of renewable energy on Maui and Kauai.

Our two solar farm investments on Kauai produce a total of 18 megawatts at peak output meeting roughly 30% of Kauai’s daytime power needs and producing very attractive returns for A&B.

A number of these types of solar farms are being proposed for development in 2016 due to Hawaii’s mandate for renewable energy expansion and the sunset of the current federal solar tax credit regime. We are actively pursuing investments in these projects and expect to report new investments in future calls.

With that, let me turn it over to Paul to talk about financial matters..

Thank you, George. On Slide 24, we compare our balance sheet at the end of the quarter to year-end.

Sales proceeds from Waihonua Maui Business Park, Kahala Avenue and other development sales allowed us to reduce our debt levels considerably resulting in a 5 percentage point decrease in our debt to debt plus equity ratio from 37% at the end of 2014 to 32% at the end of September.

Moving on to Slide 25, of the $56 million in total capital expenditure so far this year, $36 million went to investment capital, the majority of which was for active real estate projects and joint ventures. The remaining $20 million was for maintenance capital.

For the balance of the year, we have roughly $150 million in budgeted investment capital remaining including a $50 million placeholder for potential commercial property acquisitions that we expect will be funded through 1031 exchanges.

While some of the remaining budget will be invested in existing development projects given where we are in the year, the timing of most of these expenditures will likely slip into next year. With that let me turn the call back to Stan for closing remarks..

Thank you, Paul. Real estate performance was again positive in the quarter. Sales at our key projects remain active and we continue to build our development pipeline. For our commercial portfolio, we are expecting an 8% increase in full year NOI.

Our sugar operations however were hit hard by abnormally wet weather in the quarter resulting in greater than expected losses. These losses require us to make changes and we are proceeding with urgency on the two-pronged approach Chris discussed earlier. We will update you on the results of these efforts no later than by our next earnings call.

Our Materials & Construction segment generated $10 million of EBITDA in the third quarter and the healthy backlog will benefit future performance.

We continue to seek to grow the Company through traditional investments in real estate development and commercial properties but also through more creative ways such as the recent investments and the B note financing for a new high-rise condominium in Kaka’ako and expansion of our energy portfolio.

These are investments that deliver attractive returns, carry relatively low investment risk and allow us to capitalize on strong growth sectors in our state’s economy. That concludes our presentation this afternoon and we would now be happy to answer your questions. Thank you..

[Operator Instructions] And stand by for your first question which comes from the line of Sheila McGrath from Evercore. Please go ahead..

Yes, good morning. I wanted to ask you to explain Chris, a little bit more on the ag business, the enhancements to sugar offtake agreements.

Could you explain exactly what that means?.

I can’t go into a lot of detail, Sheila, because our discussions are confidential but just in general as we look at the business we do recognize that production going forward is going to be limited, certainly not limited to the levels of this year we don’t believe because this year has been a real outlier in terms of weather and production.

But when we just look at the business model really the lever that we think is potentially most constructive to try to pull is the revenue per ton of sugar. And so that really leaves us needing to look for ways to enhance our revenue model.

And so that is what we are focused on talking to customers about our ability to generate incremental revenue and hopefully shift some additional risk of the business and the volatility of the business to customers. And that is about all I can say..

Okay. And then the other part of the announcement said accelerated evaluation of alternative business model.

Would that relate back to what you have said in prior quarters about potentially considering multi-crops in the ag business?.

Yes, that is right, Sheila. One thing we have concluded just to put this in perspective. This plantation is 2.5 times the size of Manhattan and so it is a big, big operation and to transition it to one crop is very challenging. So what we have concluded is that we are probably best off looking at multiple uses of the land.

There are different microclimates, there are different soil qualities and so what we are looking at is more of a diversified approach as opposed to a mono crop which is what we have today. So that is exactly what we are evaluating is a more diversified ag operation with maybe several different components..

Okay. A couple of other quick questions. I was wondering if you could explain the potential opportunity at the Macy’s store that you highlighted that you will get back I believe early next year..

Yes, Sheila, thank you. Let me ask David Haverly to comment on that..

Hi, Sheila. The Macy’s building is about a 60,000 square foot building that Macy’s is giving up. They currently ground lease that from us and that lease will expire in the first quarter of 2016.

Our current plan is to take back the building and split it up into multiple units for primarily restaurant and small retail bays and our hope is to get that online as quickly as possible probably in early or mid-2017..

Okay, great. One last little – it is a dumb question but when I look at the earnings release, it says net income of $6.7 million and then if I divide by fully diluted shares, I get $0.135 but it says $0.11. So I’m sure there is some adjustment there but I’m not clear on what it is..

Yes. Hi, Sheila, this is Paul. So what you are seeing is essentially we have a 70% interest in GLP Asphalt with another member owning 30% and the other member actually has an option to redeem his membership interest at the greater of book value or a calculated formula.

So in the past there wasn’t really a material or significant difference between those two figures.

In 2014, GLP had pretty strong performance so if you looked at the calculated value, it exceeded the book value and under GAAP what we are required to do is allocate that increase in net value to the noncontrolling interest, which means that the earnings available to A&B shareholders is reduced by that amount.

So I think the adjustment was about $1.3 million for the quarter..

Okay, but it didn’t appear in last quarter, correct?.

It did not, no..

So what should we think about, should we consider this as an adjustment more permanent in the future?.

It is really based on the performance of the entity and what I would say is that it could go both ways. It is hard for me to predict and give you guidance that it will always be negative because I think it can also be positive.

So again, it’s based on this calculated formula and because of that it is a little tough to really model in specific sort of impact from it..

Okay, all right. Thank you..

[Operator Instructions] Our next question is from the line of Steve OHara from Sidoti. Please go ahead..

Yes. Hi, good morning..

Hi, Steve..

Good afternoon..

I was just wondering in terms of the agribusiness and the discussion there and the plans, what is the – obviously you haven’t made a decision yet but I’m just kind of curious in terms of the potential turnaround timeframe how long might a turnaround take and what type of returns or operating income are you targeting in making the change?.

So, Steve, this is Chris. Let me ask you to clarify.

When you talk about turnaround, you mean turnaround in performance in the sugar business or a transition if we were to make a decision to transition to something else?.

I guess probably transition, both would be helpful..

Yes. So first of all, I think if we were on the former on the sugar front, if we were able to have some favorable outcome in some of our discussions with our customers and then we got back to normal weather patterns next year, we could have a very different financial outcome, a very significant turnaround in that sense in the sugar business.

And that is why we have remained hopeful that we could turn the business around.

Should we decide to go a different direction and make a transition then the first thing to know is we have all of our fields planted or most of our fields, we plant them immediately after we harvest them and so most of our fields are planted and we have a lot of sugar out in the field.

So it is probably a 1 to 1.5 year process simply of harvesting the balance of the sugar. And then and then there would be transition time into alternative crops or alternative uses. So you are probably looking at a two, three-year timeframe on the short end of transitioning and probably to ever make a full transition could take even longer.

It’s really hard to say and it depends on what uses we transition into so not trying to be vague but it really does depend on exactly what we do with the land..

Okay, that is helpful. And then just on the NOI and maybe the operating income possibly, but the operating profit and NOI I think it was up year-over-year but kind of down sequentially.

And I’m just kind of wondering was that due to some repositioning or just change in assets or anything like that?.

Hi, Steve, it is David Haverly. Primarily the change in the quarter relates to two properties, Pearl Highlands Center and Waianae Mall, which had some occupancy adjustments that brought down their total NOI for the quarters.

However on a year to date basis, the total retail portfolio NOI has grown over 8%, almost 9% and again that is a significant part of our portfolio in Hawaii..

Okay. And then maybe just the last one for me. In terms of the investments that you are looking into, can you just maybe clarify, you said for the commercial portfolio, are we talking about additional high-rise projects in Kaka’ako, or residential projects or additions to the leasing portfolio? If you could just maybe clarify that a bit for me.

Thank you..

Hey, Steve, this is Lance.

Unfortunately we don’t comment specifically on acquisitions that are in progress but what I will say is that we’re continuing to look at urban Honolulu type deals that have a nearer-term horizon than starting from ground-up as well as continued interest in suburban residential opportunities in West Oahu and similarly continued interest on the commercial portfolio for income properties..

And Steve, I would only add to that that the reference that I made to the fact that we are hopeful that we would be able to announce a deal by the time of our next call, what I’m referring to there is a deal that we hope to be able to consummate on the commercial portfolio, not a development deal..

Okay. Thank you..

Although as Lance indicated, we are still very actively looking at development deals..

Okay..

Your next question comes from the line of Wilkes Graham from Compass Point. Please go ahead..

Hey, good afternoon.

Just following up on that last question, Chris, if it’s a commercial acquisition I assume that would be something you could find with 1031 sales on the Mainland NOI?.

Yes, it is our expectation that it would be funded primarily if not entirely with 1031 proceeds. They could be as usual from Mainland dispositions. It also could consist of some 1031 proceeds from land sales in Hawaii as well..

Okay, and then this might be for George.

On Grace, I saw the backlog increased in the quarter, is there an update on how the government contract bid process is going?.

Yes. Certainly the government contracting is coming out at a much more robust pace than we saw last year and so we are pleased with that. The little bit of a delay right now in some of the projects is related to them issuing the notices to proceed once they have announced the winning bidder and contracted for the work.

So that timeframe usually ranges from three to six months. Right now it tends to be more towards the six-month side of that range than the three-month side but it is we are happy to report getting a little bit better.

So as the city has gotten more comfortable putting out this level of work, we have seen some progress in their ability to do so more efficiently than they did in 2014..

Thank you. Appreciate it and we look forward to what you guys announce next quarter on the sugar business..

Thanks, Wilkes..

And your next question comes from the line of Sheila McGrath from Evercore. Please go ahead..

Sure, Chris, I was wondering if you could help us a little bit on development sales. It is always lumpy quarter-to-quarter. We haven’t seen anything from Kahala.

Is that a project that we should expect activity the balance of the year or how should we think about that project?.

How you should think about that project is it is phenomenal..

Of course..

And if you want more detail, I can say yes, we have had a couple of very big sales in Kahala this year and some smaller sales as well. We are very much on track with our original underwriting. We have a little bit more than halfway through our original four year kind of timeline for selling out the project.

We have sold about 70% of the lots and about two-thirds of the acreage so that has been going very well and we are pleased with it. Having said that, we do still have I think about nine lots remaining and so we do have some inventory.

The only activity that I would anticipate the balance of this year is one mountainside home that is under right now a nonbinding contract but knock on wood, we feel fairly good that, that will move forward.

Compared to some of the oceanfront stuff, it is a relatively small transaction but we continue to have good interest in the properties on Kahala Avenue and while we can’t predict what will happen next year we feel very good about where we are and hope to have some more activity next year..

And then you had pretty positive comments on Maui Business Park as well.

Is there anything in terms of between now and year end that is moving far along that we could potentially see some more closings there or are we better off thinking about that as 2016?.

Yes. Again there I would point to what we have done year-to-date having sold 18.4 acres is a pretty darn good result. We do have, we did have in October a closing of a couple of parcels comprising I think about an acre or so.

I don’t think you should anticipate anything else in the fourth quarter at Maui Business Park but we do have some stuff that we are optimistic about next year..

Okay. And then last question, on The Collection activity on the townhouses seemed good.

Can you just remind us the timeline of when you expect to start closings on The Collection, how much capital is tied up in that as well?.

Yes, so as far as closings, we do expect to complete the building. Construction is on schedule, we expect to complete the building next November, which would set us up for closings at the end of next year. It is possible that some of those closings could spill over into 2017.

So I’m certainly not in a position to say that we would have all the closings in 2016 but that would be our hope and expectation. And I don’t want to misquote the capital number.

Paul, do you know?.

I can give a range. I believe we are in the $52 million, $53 million range..

Yeah..

All right, great. Thank you..

Thank you. I would now like to turn the call over to Suzy Hollinger for closing remarks..

Thanks for being on the call today. If anyone has additional questions please call me at 808-525-8422. Thank you..

Thank you for your participation in today’s conference. This concludes the presentation. You now may disconnect. Thank you very much and have a very good day..