Hawaiian Electric Industries’ earnings rose sharply in the fourth quarter, but the gain was mostly due to an unusually poor performance a year earlier when the company’s bank subsidiary wrote off losses from the sale of securities backed by mainland mortgages.
HEI said it earned $24.7 million, or 26 cents a share, in the three months ending Dec. 31, up from $13.7 million, or 15 cents a share, in the year-earlier period.
But last quarter’s earnings were below earnings from a year earlier if the mortgage write-off is excluded.
Without the write-off of the private issue mortgage-related securities held by American Savings Bank, HEI earned $33 million, or 36 cents a share, in the fourth quarter of 2009.
For the full year HEI earned $113.5 million, or $1.21 a share, up from $83 million, or 91 cents a share, in 2009. Without the write-off HEI earned $102.3 million, or $1.12 a share in 2009.
"This was a solid year for HEI as we demonstrated improved profitability and earnings and reduced risk," President and CEO Constance Lau said in a news release.
She said HEI’s combination of banking and electric utility subsidiaries "continues to provide our company with a strong balance sheet, access to capital markets needed to invest in the strategies of our companies and the financial resources to continue providing an attractive dividend to our shareholders."
Lau did not mention an effort under way by a group of investors to buy HEI and take it private. A group operating under the name Kuokoa announced a plan last month to buy HEI and focus on accelerating the move to renewable energy by its Hawaiian Electric Co. subsidiary. The group said if its takeover was successful, it would sell American Savings Bank.
HEI said HECO’s earnings were lower in the fourth quarter and for the full year mainly due to lower electricity sales and higher expenses from operations ad maintenance.
HECO’s net income fell to $18.9 million in the fourth quarter from $23.3 million in the same period a year earlier. For the full year net income totaled $76.6 million, down from $79.4 million in 2009.
American Savings Bank earned $13.3 million in the fourth quarter compared with $14.9 million, excluding the mortgage securities write-off. For the full year American Savings reported it earned $58.5 million, up from $41.1 million in 2009, excluding the write-off.