Question-and-Answer Session
Operator
(Operator Instructions)
Your first question comes from the line of Jonathan Chappell with JPMorgan. Please proceed.
Jonathan Chappell - JPMorgan
Thanks good morning, guys.
Allen Doane
Good morning.
Jonathan Chappell – JPMorgan
Stan, a question for you. You mentioned in your remarks on the real estate sale side that in Kukui'ula you are adjusting some plans to better reflect the current market conditions? Can you give a little bit more information about that, is that just adjusting the timing of that development or are there bigger picture things being change with the Kukui'ula?
Stan Kuriyama
There are, we are moving forward well with construction at Kukui'ula. There are lot of the major components being built now infrastructure, on-site civil work, et cetera, et cetera. But sales obviously have been slower than we had originally anticipated, and I think we just want to better match the timing and amount of our CapEx to better reflect the sales environment we are in and we are expecting over the next year or two.
Obviously, we are looking at overhead cost, but these are same steps that we are taking for all of our projects, Jonathan. I mean, we are looking at all of our development projects, (inaudible) the CapEx deferred to match obviously a very soft sales environment.
Jonathan Chappell – JPMorgan
Okay. Continuing on that same trend with a business different line, in the agribusiness, what are some of the steps that you plan on taking to improve the profitability in that business?
Stan Kuriyama
Yeah. This is a difficult issue for us to address, it's also disappointing one for us. As Allen indicated, our production is down and the primary reason our production is down is because of an incredible drought that we are experiencing on the island of Maui. As soon as our sugar plantation keeps records of water deliveries to our plantation, we have been keeping records since 1925. We expect 2008 to be the driest year in our history and last year was one of the driest year, so you basically have back-to-back years together probably with dries two year period in all of our recorded history.
So that is having a big impact on sugar production or ability of growth sugar and yields. And as long as this is only so much we can do about that. But having said that with the scope of these losses are not acceptable to us, so we are going to be looking at all of alternatives and that's something that we will be undertaking for the next few months.
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