Hawaiian Electric Industries Inc., the holding company for the state’s largest utility and third-largest bank, reported Tuesday that net income fell 20.9% in the first quarter primarily due to nonrecurring items that occurred in the year-earlier period.
The company posted earnings of $54.7 million, or 50 cents a share. That missed analysts’ consensus estimate of 53 cents a share. In the year-earlier quarter, HEI earned $69.2 million, or 63 cents a share.
HEI said its net income was lower in the January-March period partly due to a $6.2 million after-tax gain, the equivalent of 6 cents a share, that it realized in the first quarter of 2022 from the sale by HEI subsidiary Pacific Current of an EverCharge equity investment to expand charging stations in the state. Also contributing to the lower earnings last quarter was $3.3 million that the bank released from its loan-loss reserve in the year-earlier period.
“Our combination of businesses continued to deliver solid results in the first quarter,” HEI President and CEO Scott Seu said on a conference call with analysts. “ASB’s low-risk community banking model, supported by a strong, primarily retail deposit franchise, showed its resilience. And with 86% of deposits from our retail customers and 85% of total deposits FDIC insured or fully collateralized, ASB is a very different bank than the banks that have experienced challenges in recent months. The utility continues to show its ability to deliver consistent performance under performance-based regulation, or PBR, and operate efficiently to deliver earnings growth.”
Utility Hawaiian Electric, which provides power to Oahu, Maui and Hawaii island, endured elevated costs from storms during the quarter but still saw its net income rise 1.3% to $47 million from $46.4 million in the year-earlier quarter. The utility’s cost for fuel oil jumped 51% to $334.1 million from $221.3 million in the year-earlier period, while its purchased power fell 6.6% to $152.8 million from $163.5 million. Revenue at the utility climbed 17.2% to $830.4 million from $708.8 million. The cost of oil and purchased power is passed through directly to customers with no markup.
“The utility continued to manage costs efficiently, and excluding higher maintenance and repair costs related to impacts from increased storm activity during the quarter, operations and maintenance expense was held nearly flat compared to the first quarter of last year,” Seu said.
American Savings, meanwhile, reported separately April 28 that its net income fell 22.2% in the first quarter to $18.6 million from $23.9 million in the year-earlier period, but said its earnings grew 3.7% from the previous three months.
Deposits fell 0.7% to $8.23 billion from the year-earlier quarter and edged up 0.7% from the fourth quarter.
Loans rose 17% to $6 billion from the year-earlier period and increased 1.4% from the fourth quarter.
Overall, HEI’s revenue rose 18.2% to $928.2 million from $785 million in the year-earlier period.
On Thursday, HEI announced it was maintaining its quarterly dividend at 36 cents a share. It will be payable June 9 to shareholders of record at the close of business May 19.
HEI’s stock fell 98 cents to $37.55 after the earnings were announced Tuesday.
FIRST-QUARTER NET
$54.7 million
YEAR-EARLIER NET
$69.2 million
