Profit dips for Hawaiian Electric Industries as utility customers see small savings

Hawaiian Electric Industries Inc. earned a slightly smaller profit and provided its utility customers with a little more savings in the third quarter.

The parent company of the state’s largest utility reported earning $63.4 million in the July- September period, down 2.5% from $65 million in the same quarter of 2020.

HEI also said it delivered $3 million in savings to utility customers in the recent quarter as part of a performance-based regulation framework approved in 2020 by the state Public Utilities Commission.

The third quarter was the first full quarter that HEI’s utility subsidiary, Hawaiian Electric Co., has been operating under the performance-based system with incentives that affect its costs and can benefit customers.

HEI said it is on track to deliver another $3 million in customer savings in the fourth quarter.

“Cost efficiency remains a key focus,” Connie Lau, HEI president and CEO, said Friday in a statement with the earnings announcement.

Lau, who is retiring at the end of the year after a 37-year career with the company that includes 15 years as its top executive, also said HEI’s financial results were solid.

“HEI had a good third quarter,” she said on a conference call with stock analysts.

Revenue rose 18% to $757 million in the third quarter from $641 million a year earlier.

HEI’s profit included $50.3 million in net income from its utility subsidiary, $19.3 million in net income from American Savings Bank and a $6.2 million net loss from other operations.

Compared with the year-ago quarter, the utility’s net income was down 16.3% from $60.1 million, while the bank’s net income was up 58.2% from $12.2 million and the net loss from other operations was an improvement from a $7.2 million loss.

HEI said the reduced profit from its utility, which powers 95% of the state with service to about 460,000 customers on Oahu, in Maui County and on Hawaii island, was largely due to costs for power-generation facility overhauls that had been pushed back from earlier in the year, and a change in when revenues are recognized so that seasonal factors are smoothed out.

The increase for American Savings Bank was largely due to gains on investment securities owned by the bank.

And the smaller loss for other HEI operations was mainly the result of reduced corporate expenses and higher income from a subsidiary called Pacific Current which invests in nonregulated clean energy and sustainable infrastructure.

Shares of HEI rose 18 cents to $41.32 Friday after the earnings announcement.

The company’s board maintained HEI’s stock dividend at 34 cents a share for the quarter. It will be payable Dec. 10 to shareholders of record at the close of business Nov. 23.

On Jan. 1, Scott Seu, president and CEO the company’s utility subsidiary, will head up HEI with the same titles.