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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: July 23, 2001
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Exact Name of Registrant Commission I.R.S. Employer
as Specified in Its Charter File Number Identification No.
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Hawaiian Electric Industries, Inc. 1-8503 99-0208097
Hawaiian Electric Company, Inc. 1-4955 99-0040500
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State of Hawaii
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(State or other jurisdiction of incorporation)
900 Richards Street, Honolulu, Hawaii 96813
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(Address of principal executive offices and zip code)
Registrant's telephone number, including area code:
(808) 543-5662 - Hawaiian Electric Industries, Inc. (HEI)
(808) 543-7771 - Hawaiian Electric Company, Inc. (HECO)
None
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(Former name or former address, if changed since last report.)
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Item 5. Other Events
News release
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On July 23, 2001, HEI issued the following news release:
HAWAIIAN ELECTRIC INDUSTRIES, INC. REPORTS FIRST QUARTER 2001 EARNINGS
HONOLULU -- Hawaiian Electric Industries, Inc. (NYSE - HE) today reported
net income for the three months ended June 30, 2001 of $25.6 million, or 76
cents per share, compared with $19.1 million, or 59 cents per share in the same
quarter of 2000. For the six months ended June 30, 2001, net income was $53.3
million, or $1.60 per share, compared with $48.1 million, or $1.49 per share in
the same period last year.
"We had a good second quarter. Earnings were up compared with the same
quarter last year due to an 8.6% increase in savings bank net income and
contraction of our international operations," said Robert F. Clarke, HEI
chairman, president and chief executive officer.
Electric utility net income during the quarter was $22.7 million versus
$24.0 million in the same quarter last year. Net income for the six months was
$44.1 million versus $47.7 million in the same period of 2000.
"Warmer weather boosted kilowatthour sales by 1.4% for the quarter despite
visitor arrivals in April and May declining slightly from 2000's record highs.
However, purchase power expenses were higher for the quarter due to greater
availability of purchased power in the supply mix as a result of shorter
overhaul schedules and maintenance downtime by independent power producers
(IPPs)," said Clarke.
Savings bank net income in the second quarter was $10.2 million compared to
$9.4 million in the same quarter last year. Net income for the six months was
$22.1 million versus $20.6 million in the same period of 2000.
"Our savings bank turned in a strong performance this quarter. Although
personnel and technology costs were higher compared with the same quarter last
year, the bank was able to increase its second quarter earnings by 8.6% due to
higher net interest income and fee income," said Clarke.
The increase in the bank's net interest income was due in part to slightly
higher average interest earning assets, partially offset by a decline in the
bank's interest rate spread - the difference between the yield on earning assets
and the cost of funds. Increased mortgage banking activity and credit card
interchange fees lifted fee income in the second quarter, as well as fewer
losses from investing activities.
The net loss for the international power operations during the quarter was
$0.9 million compared to $8.9 million in the same quarter last year. The net
loss for the six months was $0.8 million versus $9.9 million in the same period
of 2000.
1
The net loss from international power for the quarter and six months ended
June 30, 2000 included $6.4 million of net losses from its investment in East
Asia Power Resources Corporation, which was written off in December 2000.
HEI is a diversified holding company. Its core businesses are electric
utilities, a savings bank and an international power subsidiary.
###
Forward-looking statements
This release may contain "forward-looking statements," that are subject to
risks and uncertainties. Forward-looking statements are statements that are
predictive in nature, depend upon or refer to future events or conditions,
and/or include words such as expects, anticipates, intends, plans, believes,
predicts, estimates or similar expressions. Forward-looking statements in this
release should be read in conjunction with "Forward-looking statements" set
forth on page v of HEI's Form 10-Q for the quarter ended March 31, 2001
(incorporated by reference herein) that discusses important factors that could
cause HEI's results to differ materially from those anticipated in such
statements. Forward-looking statements speak only as of the date of this
release.
2
Hawaiian Electric Industries, Inc. and subsidiaries
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
Three months Six months Twelve months
(in thousands, ended June 30, ended June 30, ended June 30,
except per share amounts) 2001 2000 2001 2000 2001 2000
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Revenues
Electric utility $ 313,651 $ 307,845 $ 632,074 $ 597,250 $ 1,311,994 $ 1,162,391
Savings bank 112,250 108,699 228,004 218,966 459,920 426,840
International power 1,455 (4,163) 2,985 (2,700) (7,602) (560)
Other 1,438 755 598 1,495 3,362 27,695
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428,794 413,136 863,661 815,011 1,767,674 1,616,366
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Expenses
Electric utility 263,623 256,230 534,036 494,005 1,124,110 969,669
Savings bank 94,678 92,384 190,283 183,461 387,663 361,903
International power 1,832 4,423 2,579 6,518 84,960 11,277
Other 4,338 2,973 6,723 5,699 10,882 27,060
----------- ----------- ----------- ----------- ----------- -----------
364,471 356,010 733,621 689,683 1,607,615 1,369,909
----------- ----------- ----------- ----------- ----------- -----------
Operating income (loss)
Electric utility 50,028 51,615 98,038 103,245 187,884 192,722
Savings bank 17,572 16,315 37,721 35,505 72,257 64,937
International power (377) (8,586) 406 (9,218) (92,562) (11,837)
Other (2,900) (2,218) (6,125) (4,204) (7,520) 635
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64,323 57,126 130,040 125,328 160,059 246,457
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Interest expense-
other than savings bank (20,297) (20,156) (40,302) (39,228) (79,695) (74,971)
Allowance for borrowed funds
used during construction 511 722 1,187 1,413 2,696 2,750
Preferred stock dividends of
subsidiaries (501) (506) (1,003) (1,004) (2,006) (2,013)
Preferred securities distributions of
trust subsidiaries (4,009) (4,009) (8,018) (8,018) (16,035) (16,036)
Allowance for equity funds
used during construction 955 1,328 2,220 2,597 5,003 4,799
----------- ----------- ----------- ----------- ----------- -----------
Income from continuing operations
before income taxes 40,982 34,505 84,124 81,088 70,022 160,986
Income taxes 15,394 15,409 30,791 33,016 19,017 63,530
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Income from continuing operations 25,588 19,096 53,333 48,072 51,005 97,456
Discontinued operations-
net gain on disposal -- -- -- -- -- 3,953
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Net income $ 25,588 $ 19,096 $ 53,333 $ 48,072 $ 51,005 $ 101,409
=========== =========== =========== =========== =========== ===========
Per common share
Basic earnings
Continuing operations $ 0.76 $ 0.59 $ 1.60 $ 1.49 $ 1.54 $ 3.02
Discontinued operations -- -- -- -- -- 0.12
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$ 0.76 $ 0.59 $ 1.60 $ 1.49 $ 1.54 $ 3.14
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Diluted earnings
Continuing operations $ 0.76 $ 0.59 $ 1.59 $ 1.48 $ 1.54 $ 3.01
Discontinued operations -- -- -- -- -- 0.12
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$ 0.76 $ 0.59 $ 1.59 $ 1.48 $ 1.54 $ 3.13
=========== =========== =========== =========== =========== ===========
Dividends $ 0.62 $ 0.62 $ 1.24 $ 1.24 $ 2.48 $ 2.48
=========== =========== =========== =========== =========== ===========
Weighted-average number of
common shares outstanding 33,481 32,403 33,321 32,335 33,035 32,271
=========== =========== =========== =========== =========== ===========
Adjusted weighted-average shares 33,646 32,542 33,477 32,457 33,172 32,396
=========== =========== =========== =========== =========== ===========
Income (loss) from continuing
operations by segment
Electric utility $ 22,716 $ 24,014 $ 44,141 $ 47,739 $ 83,688 $ 86,656
Savings bank 10,207 9,396 22,082 20,617 42,095 38,447
International power (907) (8,863) (782) (9,890) (95,044) (12,753)
Other (6,428) (5,451) (12,108) (10,394) 20,266 (14,894)
----------- ----------- ----------- ----------- ----------- -----------
Income from continuing operations $ 25,588 $ 19,096 $ 53,333 $ 48,072 $ 51,005 $ 97,456
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This information should be read in conjunction with the consolidated financial
statements and the notes thereto incorporated by reference in HEI's Annual
Report on SEC Form 10-K for the year ended December 31, 2000 and the
consolidated financial statements and the notes thereto in HEI's Quarterly
Report on SEC Form 10-Q for the quarters ended March 31, 2001 and June 30, 2001
(when filed).
Results of operations for interim periods are not necessarily indicative of
results to be expected for future interim periods or the full year.
3
HAWAIIAN ELECTRIC INDUSTRIES, INC.
SUPPLEMENTAL DATA TO 2ND QUARTER 2001 EARNINGS RELEASE
(Unaudited)
Hawaiian Electric Company, Inc. (HECO) and subsidiaries Three months ended Six months ended
Consolidated Statements of Income June 30, June 30,
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(in thousands) 2001 2000 2001 2000
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Operating revenues $ 312,455 $ 306,483 $ 629,748 $ 594,904
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Operating expenses
Fuel oil 82,085 91,092 170,330 166,247
Purchased power 83,481 70,444 165,397 140,670
Other operation 30,096 27,464 59,870 55,205
Maintenance 13,015 13,622 28,212 26,155
Depreciation 25,363 24,330 49,972 48,664
Taxes, other than income taxes 29,426 29,005 59,917 56,366
Income taxes 14,362 15,201 27,966 30,394
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277,828 271,158 561,664 523,701
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Operating income 34,627 35,325 68,084 71,203
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Other income
Allowance for equity funds used during construction 955 1,328 2,220 2,597
Other net 960 1,138 1,937 1,713
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1,915 2,466 4,157 4,310
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Income before interest and other charges 36,542 37,791 72,241 75,513
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Interest and other charges
Interest on long-term debt 10,072 9,920 20,001 19,852
Amortization of net bond premium and expense 507 525 1,037 967
Other interest charges 1,340 1,635 3,413 3,532
Allowance for borrowed funds used during construction (511) (722) (1,187) (1,413)
Preferred stock dividends of subsidiaries 229 230 458 458
Preferred securities distributions of trust subsidiaries 1,919 1,919 3,838 3,838
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13,556 13,507 27,560 27,234
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Income before preferred stock dividends of HECO 22,986 24,284 44,681 48,279
Preferred stock dividends of HECO 270 270 540 540
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Net income for common stock $ 22,716 $ 24,014 $ 44,141 $ 47,739
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Other electric utility information
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Kilowatthour sales (millions) 2,298 2,266 4,539 4,469
Cooling degree days (Oahu) 1,223 1,207 2,133 2,035
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Hawaiian Electric Industries, Inc.
Supplemental Data to 2nd Quarter Earnings Release
Page 2
Three months ended Six months ended
American Savings Bank, F.S.B. and subsidiaries June 30, June 30,
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Consolidated Income statement data 2001 2000 2001 2000
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(in thousands)
Interest income $ 102,591 $ 103,276 $ 210,192 $ 205,784
Interest expense 56,812 58,334 117,312 114,052
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Net interest income 45,779 44,942 92,880 91,732
Provision for loan losses (3,000) (3,400) (6,000) (6,400)
Other income 9,659 5,423 17,812 13,182
Operating, administrative and general expenses (34,866) (30,650) (66,971) (63,009)
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Operating income 17,572 16,315 37,721 35,505
Minority interest 55 53 114 110
Income taxes 5,958 5,510 12,820 12,072
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Income before preferred stock dividends 11,559 10,752 24,787 23,323
Preferred stock dividends 1,352 1,356 2,705 2,706
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Net income $ 10,207 $ 9,396 $ 22,082 $ 20,617
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Interest rate spread (%) 3.07 3.18 3.08 3.19
5
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrants have duly caused this report to be signed on their behalf by the
undersigned thereunto duly authorized. The signature of the undersigned
companies shall be deemed to relate only to matters having reference to such
companies and any subsidiaries thereof.
HAWAIIAN ELECTRIC INDUSTRIES, INC. HAWAIIAN ELECTRIC COMPANY, INC.
(Registrant) (Registrant)
/s/ Curtis Y. Harada /s/ Richard A. von Gnechten
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Curtis Y. Harada Richard A. von Gnechten
Controller Financial Vice President of HECO
(Principal Accounting Officer of HEI) (Principal Financial Officer of HECO)
Date: July 24, 2001 Date: July 24, 2001
6