A loss at its Matson Navigation Co. subsidiary dragged down net profit for Alexander & Baldwin Inc. in the first quarter.

The Honolulu-based company earned $5.2 million in the January-to-March period, a 70 percent reduction from $17.3 million in the same period last year.

Real estate and agriculture businesses produced enough operating profit for A&B to outweigh a $7.4 million operating loss for ocean transportation subsidiary Matson.

A&B’s net profit equated to 12 cents per share of stock, which exceeded estimates from three Wall Street analysts who projected earnings per share between minus 1 cent and plus 3 cents. A&B had issued an outlook on March 18 advising of near break-even results.

Stan Kuriyama, A&B’s president and chief executive officer, said the better-than-projected results were due to property sales and other improvements.

Matson’s operating loss was principally due to fuel prices that rose faster than could be recouped through customer surcharges, the company said.

Another factor was startup losses for an expansion of Matson’s China service and lower freight rates and volumes related to enlarged capacity in the China trade from Matson and other operators.

"Performance for (the China service) in the quarter fell short of our expectations," Matthew Cox, Matson’s president, said in a conference call with stock analysts yesterday.

In Hawaii, Matson container shipments rose 8 percent, primarily due to a new agreement to receive cargo from a large international carrier, though the improving local economy also played a role, A&B said.

Automobile shipping in Hawaii fell 18 percent largely due to rental car fleet replacement timing.

Real estate largely drove A&B profit. Leasing activity in A&B’s portfolio of investment properties including shopping centers, office buildings and warehouses generated a $10.6 million operating profit in the first quarter, up from $9.1 million a year earlier.

Operating profit from real estate sales was $12 million in the first quarter, down from $21.4 million a year earlier when there were higher-value sales.

A&B said it is close to starting a couple of big Hawaii development projects, including an initial 100-acre piece of the second phase of Maui Business Park, where construction is expected to begin by the end of June; and a 335-unit condominium tower in Kakaako, where sales efforts are slated to begin by the end of the year.

A&B bought the Kakaako site last year. The site is next to the Hawaiki and Ko‘olani luxury condominium towers. Units in A&B’s planned condo will likely cost $600,000 to $800,000.

"This project is well positioned to benefit from an upward trend in demand for primary housing in urban Honolulu that we believe will gain momentum over the next 12 to 18 months," Norb Buelsing, president of A&B’s real estate subsidiary, said.

In agriculture, A&B posted a $2.6 million operating profit in the first quarter, compared with a $1.1 million operating loss a year earlier.

Shares of A&B stock closed yesterday at $51.38 before the earnings report was released. The price was down $1.32 from Monday’s close.