HEI's revenue up, profit down

By Sean Hao
Advertiser Staff Writer

•	Hawaiian Electric Industries Inc. 3rd quarter earnings: Net profit: $30.5 million, down 9 percent Total revenue: $453.7 million, up 5 percent

Those items more than offset a 5 percent rise in revenue driven by gains in the Honolulu company's electric utility business.

Hawaiian Electric Industries is a diversified holding company. Its subsidiaries include Hawaiian Electric Co., which provides electric power to most Hawai'i residents; and American Savings Bank, the state's third-largest financial institution. Together with its subsidiaries, HEI employs about 3,400 workers.

During the three months ended Sept. 30, the company earned $30.5 million, or 81 cents a share, versus income of $33.5 million, or 92 cents a share in the year-ago period.

"Kilowatt-hour sales were strong, bank net income was up 4 percent and the holding and other companies' net losses were down 24 percent this quarter," said Robert Clarke, HEI chairman, president and chief executive. "However, retirement benefits expense continues to negatively impact earnings."

Revenue rose to $453.7 million in part because of increased electricity sales from warmer weather and higher residential and Neighbor Island commercial power use. But the gain was offset by an increase in retirement benefit expenses to $5.5 million and a $1.6 million fine from the state Department of Health at two of the company's Maui generating units for violation of air pollution rules.

Among HEI's other operations, bank profits in the third quarter rose to $15.3 million compared with $14.7 million in the same quarter last year. Results were helped by lower loan loss provisions, securities gains and improvement in the value of the bank's mortgage servicing operation.

Reach Sean Hao at 525-8093 or shao@honoluluadvertiser.com.