Alexander & Baldwin Inc. first-quarter net income soared 70 percent to $42.1 million, largely on sales at the company's recently completed Keola La'i luxury residential high-rise in Kaka'ako.

Last year, A&B's first-quarter profit was $24.7 million. The profit surge in the recent quarter was driven by 300 sales at Keola La'i, which represents 85 percent of the units in the 352-unit tower. More sales in the project are expected in the second quarter, as only about 20 units are still available for sale.

A&B said that while Keola La'i was a big success, it expects the local real estate market to continue to soften and impact sales at other development projects, though the company's other core business segments of ocean transportation and agriculture have been stable.

"We started the year with a strong first quarter, led by a large number of closings at a key residential project and continued stability in our other core businesses," W. Allen Doane, A&B's chairman and chief executive, said in a statement.

Doane, in a conference call with stock analysts, said the economic environment presents increased challenges, but that A&B is confident it will have good full-year earnings that on a per-share basis will be within 5 percent up or down from last year.

In the first quarter, A&B's 70 percent profit increase came on revenue that was up 52 percent to $582.1 million from $383.1 million a year earlier.

In ocean transportation, unit Matson Navigation Co., which is A&B's biggest operation by revenue, the company reported a 5 percent gain in revenue to $243 million but a 15 percent decline in operating profit to $15.9 million.

A&B said the revenue increase was driven by fuel surcharges, favorable yields and improved cargo mix. But a 7 percent decline in Hawai'i container volume hurt operating profits.

The container volume decrease was offset by a 12 percent increase in automobile shipments that A&B attributed to timing in the movement of vehicles and not a reversal of recent weakness in retail and fleet auto sales. Matson's China and Guam container service was flat from a year earlier.

An A&B division that manages cargo transportation by ground reported a 16 percent decline in operating profit to $4.7 million on flat revenue of $102.6 million.

A&B's agriculture segment that involves sugar and coffee crops reported a 33 percent rise in operating profit to $4.8 million on a 31 percent rise in revenue to $22.5 million. The company said it increased sugar production 54 percent as more crop acres were harvested, and benefitted from higher sales and prices for sugar-related power generation.

In real estate sales, operating profit was $41.1 million in the first quarter on revenue of $187.4 million. That compared with an $8.8 million operating profit on $6.5 million in revenue a year earlier.

A&B said most of the positive results came from Keola La'i. Residential developments on Maui and Kaua'i, and commercial building sales in Valencia, Calif., also contributed to A&B earnings but not revenue because they are projects with partners. A&B also received a $7.7 million insurance settlement stemming from a 2005 fire at Kahului Shopping Center in the recent quarter.

Real estate leasing suffered a 7 percent decline in operating profit to $13.9 million on flat revenue of $28.8 million as a result of higher depreciation and property taxes associated with recent property acquisitions. Occupancy at A&B commercial properties was down 1 percentage point to 96 percent on the Mainland and was flat at 98 percent in Hawai'i.

Yesterday after A&B's earnings announcement, stock shares in the publicly traded firm closed down $2.55 at $50.23. A&B shares in the last 52 weeks ranged from a low of $41.58 last month to a high of $53.74 in December, and had reached $53.29 last week.

A&B said it repurchased 1.1 million shares of common stock in the first quarter, and earlier this month increased its annual dividend by 10 cents per share to return more cash to shareholders.

Profit per diluted share of A&B stock was $1.01 in the first quarter, up from 58 cents in the same quarter last year.