Hawaiian Electric Industries Inc. posted another strong financial performance during the first three months of the year, bolstered by the third consecutive quarter of double-digit earnings increases at its electric company subsidiary.
HEI earned $38.3 million, or 40 cents a share in the first quarter, up from $28.5 million, or 30 cents a share during the same period a year earlier, the company reported Tuesday.
More than 80 percent of the $9.8 million gain in HEI’s first-quarter net income flowed from Hawaiian Electric Co. and its subsidiaries. HEI’s American Savings Bank accounted for the remaining increase in earnings.
HECO, Maui Electric Co. and Hawaii Electric Light Co. earned a combined $27.2 million in the first quarter, up 42 percent from the $19.2 million they earned during the first quarter of 2011. That followed year-over-year earnings increases of 37 percent and 73 percent in the previous two quarters.
FIRST-QUARTER NET
$38.3 million
YEAR-EARLIER NET
$28.5 million |
Earnings were helped by a 2.2 percent interim rate increase that went into effect July 26 which allowed the utilities to begin recovering the cost of capital improvement projects started earlier in the year,
The state Public Utilities Commission approved the interim increase, which amounts to $38 million in annual revenue, to help pay for projects such as grid modernization and other projects related to HECO’s push to accommodate more renewable energy.
Tuesday’s financial report included results for American Savings Bank that HEI originally reported last week. American Savings boosted earnings 14.6 percent during the first three months of the year as it increased its loan portfolio for the sixth consecutive quarter.
It was the first time ASB reported earnings ahead of its parent company. New requirements mandate that federally regulated banks file their financial results no later than 30 days after the quarter ends.
"HEI delivered solid results in the first quarter of 2012 and continued to reinvest earnings into our Hawaii-based businesses," said Constance Lau, HEI president and chief executive officer.
Electricity sales at the HECO companies fell to 2,251 gigawatt-hours in the first quarter, a 4.2 percent decline from the same period a year earlier, HEI said. It’s average fuel oil price, meanwhile, rose to $134.37 a barrel from $101.03 a barrel during the same period.
HEI also reported that return on equity, a measure of profitability, rose at all three of its utilities. On a consolidated basis ROE increased to 7.85 percent at the end of the first quarter from 5.87 percent a year earlier. The Public Utilities Commission allows the HECO companies to earn an ROE of up to 10 percent.
