Posted at 1:21 p.m., Tuesday, August 1, 2006
Business briefs: Hawaiian Electric's profit declines
Advertiser Staff and News Services
Hawaiian Electric Industries Inc., the owner of the state's largest utility and American Savings Bank, said profit in the April-June quarter fell as electricity sales slipped.The Honolulu-based company reported a profit of $27.2 million, or 33 cents per diluted share. Analysts had forecast the company would earn 41 cents a share.
The profit was down from $28.3 million a year earlier. Hawaiian Electric said people didn't buy as much electricity because cooler weather cut into air conditioning use and because customers tried to conserve more because of rising electricity costs. Hawai'i has the highest electricity rates in the nation, according to the U.S. Energy Information Administration.
The company's bright spot was its banking subsidiary, which reported an almost 20 percent rise in net income as it enjoyed solid growth in commercial and commercial real estate businesses.
Hotel renovations cut into Hilton's profit
Hilton Hotels Corp. said today renovations its hotels in Hawai'i and New York cut into profits in the second quarter.
The nation's third-largest U.S. hotel operator reported a 29 percent decline in second-quarter profit from a year earlier, when it had a gain from selling properties.
Net income dropped to $144 million, or 35 cents a share, missing analysts' estimates. That compares to net income of $202 million, or 49 cents a share, a year earlier, the Beverly Hills, California-based company said in a statement. Revenue rose 87 percent to $2.2 billion from $1.18 billion after the company bought Hilton Group Plc in February.
The company raised rates 6.3 percent on demand at the biggest travel markets such as New York where hotel supply is limited. Hilton is expanding overseas with brands including Hilton Garden Inn following the $5.7 billion purchase of Hilton Group. A year earlier, an after-tax gain of $37 million from divesting properties lifted profit.
Hilton's income was reduced by renovations at the Hilton New York, the WaldorfAstoria in New York and the Hilton Hawaiian Village, the company said on a conference call with investors and analysts. That took rooms in key markets out of circulation and cut $15 million from 2006's earnings before taxes, depreciation and amortization.
Hilton President Matthew Hart said repairs at the Waldorf and the Hawaiian Village will be completed in the third quarter.
Shares of Hilton climbed 28 cents to $24.21 in New York Stock Exchange composite trading.
