HEI says quarter profits down 9%
Advertiser Staff
Hawaiian Electric Industries Inc. yesterday said first-quarter net income fell 9 percent as higher retirement benefit expenses offset an increase in electric usage.
HEI, which provides electric power to about 95 percent of Hawai'i's residents and owns the state's third-largest financial institution, reported net income for the three months that ended March 31 of $24.3 million, or 66 cents a share, from $26.9 million, or 75 cents in the same year-earlier period. Revenue rose 12.5 percent $424.6 million from $377.4 million a year ago.
In an indication that the state's economy continues to grow, HEI said electricity sales were up 2.5 percent in the first quarter after a rise of 2 percent in the fourth quarter.
"Increases in residential usage and the number of residential customers as a result of a strong real estate market in Hawai'i helped to boost kilowatt-hour sales," said Robert Clarke, HEI's chairman, president and chief executive officer, in a statement.
HEI also reported a 1.2 percent increase in net income at its American Savings Bank subsidiary to $13.5 million from $13.4 million, largely because of lower provisions for loan losses and improved net interest income.
Clarke said despite the increase in electric sales and bank income, net income for the company as a whole was down becauseof an increase in retirement benefit expenses that HEI has said will total about $16 million in 2003.
"We had a strong first quarter considering the expected increases in retirement benefits costs and the impact of the uncertainties surrounding the war in Iraq on the Hawai'i economy," Clarke said.
Clarke added that the outlook for HEI is clouded because of the lingering effect of the war.
"Going forward, the full impact of the conflict with Iraq on the Hawai'i tourism industry and the company's kilowatt-hour sales growth is still unknown," Clarke said.
The HEI stock fell 15 cents to $40.86 in trading yesterday. HEI shares have lost 7 percent in the past year. The company's earnings were released after the close of trading yesterday.
