HONOLULU, Nov. 2, 2017 /PRNewswire/ -- Hawaiian Electric Industries, Inc. (HEI) (NYSE: HE) today reported consolidated net income for common stock for the third quarter of 2017 of $60.1 million and diluted earnings per share (EPS) of $0.55 compared to $127.1 million and EPS of $1.17 for the third quarter of 2016. Third quarter of 2016 core earnings and core EPS were $63.3 million and $0.58, respectively. HEI's third quarter of 2016 core earnings included $6 million of favorable tax adjustments at the holding company as HEI moved out of a federal net operating loss position, enabling the recognition of tax benefits.

'HEI's core earnings for the quarter compared well to the prior year quarter. The utility performed as we expected, and we saw strong performance by American Savings Bank. The bank delivered higher earnings and profitability driven by improving credit quality and higher yields on interest-earning assets. This exemplifies the value of the unique combination of businesses which comprise HEI,' said Constance H. Lau, HEI president and chief executive officer.

___________________________

Note: Amounts indicated as 'after-tax' in this earnings release are based upon adjusting items for the composite statutory tax rates of 39% for the utilities and 40% for the bank.

Non-GAAP measure that excludes after-tax income and costs related to the terminated merger with NextEra Energy, Inc., the cancelled spin-off of ASB Hawaii, Inc., and the termination of the liquefied natural gas (LNG) contract which required PUC approval of the merger with NextEra Energy, Inc. (the 'Transaction Adjustments'). See the 'Explanation of HEI's Use of Certain Unaudited Non-GAAP measures' and the related reconciliation.

HAWAIIAN ELECTRIC COMPANY EARNINGS

Hawaiian Electric Company's net income for the third quarter of 2017 was $47.5 million as our utilities continue to perform according to plan for this transition year compared to $47.0 million in the third quarter of 2016. The $0.5 million net income increase from the prior year quarter was primarily driven by the following after-tax items:

  • $2 million higher net revenues mainly due to higher recovery of costs for integrating more renewables and reliability investments and the Hawaii Electric Light 2016 interim rate increase which became effective on August 31, 2017;
  • $2 million higher allowance for funds used during construction primarily due to the Schofield generating plant project expected to be placed in service in the second quarter of 2018; and
  • $1 million favorable tax adjustments as the utility moved out of a federal net operating loss position, enabling the recognition of tax benefits in the third quarter of 2017.

These increases were offset by the following after-tax items:

  • $4 million higher operations and maintenance expenses4 compared to the prior year quarter primarily due to higher overhaul expenses and enterprise resource planning project costs; and
  • $1 million higher depreciation expense as a result of increasing investments for the integration of more renewable energy and improved customer reliability.

______________________

2

Hawaiian Electric Company refers to the three utilities, Hawaiian Electric Company, Inc. on Oahu, Maui Electric Company, Limited, and Hawaii Electric Light Company, Inc.

3

Net revenues represent the after-tax impact of 'Revenues' less the following expenses which are largely pass through items in revenues: 'fuel oil,' 'purchased power' and 'taxes, other than income taxes' as shown on the Hawaiian Electric Company, Inc. and Subsidiaries' Condensed Consolidated Statements of Income.

4

Excludes net income neutral expenses covered by surcharges or by third parties and merger-related costs including the terminated LNG contract costs. See the 'Explanation of HEI's Use of Certain Unaudited Non-GAAP measures' and the related reconciliation.American Savings Bank earnings

AMERICAN SAVINGS BANK EARNINGS

American Savings Bank's (American) net income for the third quarter of 2017 was $17.6 million compared to $16.7 million in the second (or linked) quarter of 2017 and $15.1 million in the third quarter of 2016.

Compared to the third quarter of 2016, the $2.5 million increase was primarily driven by the following on an after-tax basis:

  • $3 million higher net interest income driven mainly by growth in interest-earning assets funded by strong deposit growth and overall improvement in asset yields; and
  • $3 million lower provision for loan losses resulting from work to improve commercial loan asset quality.

These items were offset by the following on an after-tax basis:

  • $2 million lower noninterest income primarily due to lower mortgage banking income and no gain on sale of real estate; and
  • $1 million higher noninterest expense primarily due to higher performance-based incentive cost.

Compared to the linked second quarter of 2017, the $0.9 million increase was primarily driven by lower provision for loan losses.

Total loans were $4.7 billion at September 30, 2017, a decrease of $65 million or 1.8% annualized from December 31, 2016. This decrease reflects American's work to improve overall commercial loan quality through a strategic decrease in its exposure to national syndicated credits, as well as a reduction in its commercial real estate loan portfolio. The decrease in American's commercial portfolio was partially offset by growth in home equity lines of credit, consumer and residential loan portfolios.

Total deposits were $5.8 billion at September 30, 2017, an increase of $203 million or 4.9% annualized from December 31, 2016. Low-cost core deposits increased $153 million or 4.2% annualized from December 31, 2016. The average cost of funds was 0.20% for the third quarter of 2017 compared to 0.21% for the second quarter of 2017 and 0.24% for the third quarter of 2016.

Overall, American achieved solid profitability in the third quarter of 2017 with a return on average equity of 11.6% and a return on average assets of 1.07%.

For additional information, refer to the American news release issued on October 30, 2017.

HOLDING AND OTHER COMPANIES

The holding and other companies' net loss was $5.0 million in the third quarter of 2017 compared to $65.1 million net income in the third quarter of 2016. Excluding the Transaction Adjustments which totaled $63.8 million in the third quarter of 2016, the holding and other companies' net loss was $5.0 million in the third quarter of 2017 compared to $1.2 net income in the third quarter of 2016. The holding company's third quarter of 2016 net income included $6.0 million of favorable tax adjustments as HEI moved out of a federal net operating loss position, enabling the recognition of tax benefits.

WEBCAST AND CONFERENCE CALL TO DISCUSS EARNINGS AND EPS GUIDANCE

HEI will conduct a webcast and conference call to discuss its third quarter of 2017 earnings and 2017 EPS guidance on Thursday, November 2, 2017, at 9:00 a.m. Hawaii time (3:00 p.m. Eastern time).

Interested parties within the United States may listen to the conference by calling (844) 834-0652 and international parties may listen to the conference by calling (412) 317-5198 or by accessing the webcast on HEI's website, www.hei.com, under the heading 'Investor Relations.' HEI and Hawaiian Electric Company intend to continue to use HEI's website as a means of disclosing additional information. Such disclosures will be included on HEI's website in the Investor Relations section. Accordingly, investors should routinely monitor such portions of HEI's website, in addition to following HEI's, Hawaiian Electric Company's and American's press releases, HEI's and Hawaiian Electric Company's Securities and Exchange Commission (SEC) filings and HEI's public conference calls and webcasts. The information on HEI's website is not incorporated by reference in this document or in HEI's and Hawaiian Electric Company's SEC filings unless, and except to the extent, specifically incorporated by reference. Investors may also wish to refer to the Public Utilities Commission of the State of Hawaii (PUC) website at dms.puc.hawaii.gov/dms in order to review documents filed with and issued by the PUC. No information on the PUC website is incorporated by reference in this document or in HEI's and Hawaiian Electric Company's SEC filings.

An online replay of the webcast will be available at the same website beginning about two hours after the event. Replays of the conference call will also be available approximately two hours after the event through November 16, 2017 by dialing (877) 344-7529 or (412) 317-0088 and entering passcode: 10112461.

HEI supplies power to approximately 95% of Hawaii's population through its electric utilities, Hawaiian Electric Company, Inc., Hawaii Electric Light Company, Inc. and Maui Electric Company, Limited and provides a wide array of banking and other financial services to consumers and businesses through American Savings Bank, F.S.B., one of Hawaii's largest financial institutions.

NON-GAAP MEASURES

See 'Explanation of HEI's Use of Certain Unaudited Non-GAAP Measures' and related reconciliations on pages 12 to 13 of this release.

Hawaiian Electric Industries, Inc. (HEI) and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)

Three months ended September 30

Nine months ended September 30

(in thousands, except per share amounts)

2017

2016

2017

2016

Revenues

Electric utility

$

598,769

$

572,253

$

1,674,255

$

1,549,700

Bank

74,289

73,708

222,474

213,297

Other

127

94

299

262

Total revenues

673,185

646,055

1,897,028

1,763,259

Expenses

Electric utility

511,693

482,441

1,483,194

1,333,876

Bank

47,525

50,981

146,754

150,752

Other

4,422

7,191

13,777

18,883

Total expenses

563,640

540,613

1,643,725

1,503,511

Operating income (loss)

Electric utility

87,076

89,812

191,061

215,824

Bank

26,764

22,727

75,720

62,545

Other

(4,295)

(7,097)

(13,478)

(18,621)

Total operating income

109,545

105,442

253,303

259,748

Merger termination fee

-

90,000

-

90,000

Interest expense, net-other than on deposit liabilities and other bank borrowings

(19,227)

(19,365)

(59,235)

(56,792)

Allowance for borrowed funds used during construction

1,339

854

3,371

2,276

Allowance for equity funds used during construction

3,482

2,274

8,908

6,010

Income before income taxes

95,139

179,205

206,347

301,242

Income taxes

34,595

51,592

72,003

96,203

Net income

60,544

127,613

134,344

205,039

Preferred stock dividends of subsidiaries

471

471

1,417

1,417

Net income for common stock

$

60,073

$

127,142

$

132,927

$

203,622

Basic earnings per common share

$

0.55

$

1.17

$

1.22

$

1.89

Diluted earnings per common share

$

0.55

$

1.17

$

1.22

$

1.88

Dividends declared per common share

$

0.31

$

0.31

$

0.93

$

0.93

Weighted-average number of common shares outstanding

108,786

108,268

108,737

107,951

Weighted-average shares assuming dilution

108,865

108,472

108,909

108,171

Net income (loss) for common stock by segment

Electric utility

$

47,487

$

46,974

$

94,596

$

108,198

Bank

17,592

15,104

50,138

41,062

Other

(5,006)

65,064

(11,807)

54,362

Net income for common stock

$

60,073

$

127,142

$

132,927

$

203,622

Comprehensive income attributable to Hawaiian Electric Industries, Inc.

$

60,627

$

125,473

$

136,836

$

212,861

Return on average common equity (twelve months ended)

8.5

%

12.3

%

This information should be read in conjunction with the condensed consolidated financial statements and the notes thereto in HEI filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year.

On a core basis, 2017 and 2016 returns on average common equity (twelve months ended September 30) were 8.5% and 9.5%, respectively. See reconciliation of GAAP to non-GAAP measures.

Hawaiian Electric Industries, Inc. (HEI) and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

(dollars in thousands)

September 30, 2017

December 31, 2016

Assets

Cash and cash equivalents

$

202,173

$

278,452

Accounts receivable and unbilled revenues, net

264,426

237,950

Available-for-sale investment securities, at fair value

1,320,110

1,105,182

Stock in Federal Home Loan Bank, at cost

9,706

11,218

Loans receivable held for investment, net

4,623,234

4,683,160

Loans held for sale, at lower of cost or fair value

15,728

18,817

Property, plant and equipment, net of accumulated depreciation of $2,537,320 and $2,444,348 at September 30, 2017 and December 31, 2016, respectively

4,813,875

4,603,465

Regulatory assets

936,964

957,451

Other

474,444

447,621

Goodwill

82,190

82,190

Total assets

$

12,742,850

$

12,425,506

Liabilities and shareholders' equity

Liabilities

Accounts payable

$

160,897

$

143,279

Interest and dividends payable

26,484

25,225

Deposit liabilities

5,752,326

5,548,929

Short-term borrowings-other than bank

24,498

-

Other bank borrowings

153,552

192,618

Long-term debt, net-other than bank

1,618,446

1,619,019

Deferred income taxes

756,814

728,806

Regulatory liabilities

466,216

410,693

Contributions in aid of construction

565,118

543,525

Defined benefit pension and other postretirement benefit plans liability

620,788

638,854

Other

460,396

473,512

Total liabilities

10,605,535

10,324,460

Preferred stock of subsidiaries - not subject to mandatory redemption

34,293

34,293

Shareholders' equity

Preferred stock, no par value, authorized 10,000,000 shares; issued: none

-

-

Common stock, no par value, authorized 200,000,000 shares; issued and outstanding: 108,785,978 shares and 108,583,413 shares at September 30, 2017 and December 31, 2016, respectively

1,661,492

1,660,910

Retained earnings

470,750

438,972

Accumulated other comprehensive loss, net of tax benefits

(29,220)

(33,129)

Total shareholders' equity

2,103,022

2,066,753

Total liabilities and shareholders' equity

$

12,742,850

$

12,425,506

This information should be read in conjunction with the condensed consolidated financial statements and the notes thereto in HEI filings with the SEC.

Hawaiian Electric Company, Inc. (Hawaiian Electric) and Subsidiaries
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(Unaudited)

Three months ended September 30

Nine months ended September 30

(dollars in thousands, except per barrel amounts)

2017

2016

2017

2016

Revenues

$

598,769

$

572,253

$

1,674,255

$

1,549,700

Expenses

Fuel oil

146,258

128,624

431,787

334,263

Purchased power

160,347

157,750

440,538

412,667

Other operation and maintenance

100,102

94,789

306,716

298,260

Depreciation

48,206

46,759

144,578

140,300

Taxes, other than income taxes

56,780

54,519

159,575

148,386

Total expenses

511,693

482,441

1,483,194

1,333,876

Operating income

87,076

89,812

191,061

215,824

Allowance for equity funds used during construction

3,482

2,274

8,908

6,010

Interest expense and other charges, net

(16,907)

(17,323)

(52,625)

(49,734)

Allowance for borrowed funds used during construction

1,339

854

3,371

2,276

Income before income taxes

74,990

75,617

150,715

174,376

Income taxes

27,005

28,145

54,623

64,682

Net income

47,985

47,472

96,092

109,694

Preferred stock dividends of subsidiaries

228

228

686

686

Net income attributable to Hawaiian Electric

47,757

47,244

95,406

109,008

Preferred stock dividends of Hawaiian Electric

270

270

810

810

Net income for common stock

$

47,487

$

46,974

$

94,596

$

108,198

Comprehensive income attributable to Hawaiian Electric

$

47,509

$

47,125

$

95,117

$

108,610

OTHER ELECTRIC UTILITY INFORMATION

Kilowatthour sales (millions)

Hawaiian Electric

1,776

1,800

4,924

4,982

Hawaii Electric Light

272

277

782

795

Maui Electric

292

295

822

836

2,340

2,372

6,528

6,613

Average fuel oil cost per barrel

$

66.73

$

57.72

$

67.42

$

52.06

Return on average common equity (twelve months ended)

7.16

%

8.11

%

This information should be read in conjunction with the condensed consolidated financial statements and the notes thereto in Hawaiian Electric filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year.

Simple average. On a core basis, 2017 and 2016 returns on average common equity (twelve months ended September 30) were 7.2% and 8.2%, respectively. See reconciliation of GAAP to non-GAAP measures.

Hawaiian Electric Company, Inc. (Hawaiian Electric) and Subsidiaries
CONDENSED CONSOLIDATED BALANCE SHEETS
(Unaudited)

(dollars in thousands, except par value)

September 30, 2017

December 31, 2016

Assets

Property, plant and equipment

Utility property, plant and equipment

Land

$

53,913

$

53,153

Plant and equipment

6,778,254

6,605,732

Less accumulated depreciation

(2,460,429)

(2,369,282)

Construction in progress

307,492

211,742

Utility property, plant and equipment, net

4,679,230

4,501,345

Nonutility property, plant and equipment, less accumulated depreciation of $1,233 and $1,232 at September 30, 2017 and December 31, 2016, respectively

7,409

7,407

Total property, plant and equipment, net

4,686,639

4,508,752

Current assets

Cash and cash equivalents

9,987

74,286

Customer accounts receivable, net

133,135

123,688

Accrued unbilled revenues, net

109,707

91,693

Other accounts receivable, net

4,097

5,233

Fuel oil stock, at average cost

60,253

66,430

Materials and supplies, at average cost

55,959

53,679

Prepayments and other

29,871

23,100

Regulatory assets

72,773

66,032

Total current assets

475,782

504,141

Other long-term assets

Regulatory assets

864,191

891,419

Unamortized debt expense

661

208

Other

80,228

70,908

Total other long-term assets

945,080

962,535

Total assets

$

6,107,501

$

5,975,428

Capitalization and liabilities

Capitalization

Common stock ($6 2/3 par value, authorized 50,000,000 shares; outstanding 16,019,785 shares at September 30, 2017 and December 31, 2016)

$

106,818

$

106,818

Premium on capital stock

601,487

601,491

Retained earnings

1,120,571

1,091,800

Accumulated other comprehensive income (loss), net of income taxes

199

(322)

Common stock equity

1,829,075

1,799,787

Cumulative preferred stock - not subject to mandatory redemption

34,293

34,293

Long-term debt, net

1,318,623

1,319,260

Total capitalization

3,181,991

3,153,340

Current liabilities

Short-term borrowings from non-affiliates

6,000

-

Accounts payable

124,240

117,814

Interest and preferred dividends payable

25,261

22,838

Taxes accrued

183,365

172,730

Regulatory liabilities

3,399

3,762

Other

59,611

55,221

Total current liabilities

401,876

372,365

Deferred credits and other liabilities

Deferred income taxes

767,611

733,659

Regulatory liabilities

462,817

406,931

Unamortized tax credits

88,827

88,961

Defined benefit pension and other postretirement benefit plans liability

581,713

599,726

Other

57,548

76,921

Total deferred credits and other liabilities

1,958,516

1,906,198

Contributions in aid of construction

565,118

543,525

Total capitalization and liabilities

$

6,107,501

$

5,975,428

This information should be read in conjunction with the condensed consolidated financial statements and the notes thereto in Hawaiian Electric filings with the SEC.

American Savings Bank, F.S.B.
STATEMENTS OF INCOME DATA
(Unaudited)

Three months ended

Nine months ended September 30

(in thousands)

September 30,
2017

June 30,
2017

September 30,
2016

2017

2016

Interest and dividend income

Interest and fees on loans

$

52,210

$

52,317

$

50,444

$

155,269

$

148,571

Interest and dividends on investment securities

6,850

6,763

4,759

20,593

14,219

Total interest and dividend income

59,060

59,080

55,203

175,862

162,790

Interest expense

Interest on deposit liabilities

2,444

2,311

1,871

6,858

5,154

Interest on other borrowings

470

824

1,464

2,110

4,416

Total interest expense

2,914

3,135

3,335

8,968

9,570

Net interest income

56,146

55,945

51,868

166,894

153,220

Provision for loan losses

490

2,834

5,747

7,231

15,266

Net interest income after provision for loan losses

55,656

53,111

46,121

159,663

137,954

Noninterest income

Fees from other financial services

5,635

5,810

5,599

17,055

16,799

Fee income on deposit liabilities

5,533

5,565

5,627

16,526

16,045

Fee income on other financial products

1,904

1,971

2,151

5,741

6,563

Bank-owned life insurance

1,257

1,925

1,616

4,165

3,620

Mortgage banking income

520

587

2,347

1,896

5,096

Gains on sale of investment securities, net

-

-

-

-

598

Other income, net

380

391

1,165

1,229

1,786

Total noninterest income

15,229

16,249

18,505

46,612

50,507

Noninterest expense

Compensation and employee benefits

23,724

24,742

22,844

71,703

67,197

Occupancy

4,284

4,185

3,991

12,623

12,244

Data processing

3,262

3,207

3,150

9,749

9,599

Services

2,863

2,766

2,427

7,989

8,093

Equipment

1,814

1,771

1,759

5,333

5,193

Office supplies, printing and postage

1,444

1,527

1,483

4,506

4,431

Marketing

934

839

747

2,290

2,507

FDIC insurance

746

822

907

2,296

2,704

Other expense

5,050

4,705

4,591

14,066

13,948

Total noninterest expense

44,121

44,564

41,899

130,555

125,916

Income before income taxes

26,764

24,796

22,727

75,720

62,545

Income taxes

9,172

8,063

7,623

25,582

21,483

Net income

$

17,592

$

16,733

$

15,104

$

50,138

$

41,062

Comprehensive income

$

18,009

$

18,956

$

13,176

$

53,613

$

49,537

OTHER BANK INFORMATION (annualized %, except as of period end)

Return on average assets

1.07

1.02

0.97

1.02

0.89

Return on average equity

11.64

11.25

10.36

11.24

9.5

Return on average tangible common equity

13.47

13.06

12.06

13.04

11.07

Net interest margin

3.69

3.68

3.57

3.68

3.59

Efficiency ratio

61.82

61.73

59.54

61.15

61.81

Net charge-offs to average loans outstanding

0.32

0.21

0.20

0.27

0.19

As of period end

Nonaccrual loans to loans receivable held for investment

0.50

0.44

1.11

Allowance for loan losses to loans outstanding

1.13

1.19

1.24

Tangible common equity to tangible assets

8.01

7.88

8.03

Tier-1 leverage ratio

8.7

8.5

8.6

Total capital ratio

13.9

13.7

13.3

Dividend paid to HEI (via ASB Hawaii, Inc.) ($ in millions)

$

9.4

$

9.4

$

9.0

$

28.1

$

27.0

This information should be read in conjunction with the condensed consolidated financial statements and the notes thereto in HEI filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year.

American Savings Bank, F.S.B.
BALANCE SHEETS DATA
(Unaudited)

(in thousands)

September 30, 2017

December 31, 2016

Assets

Cash and due from banks

$

120,492

$

137,083

Interest-bearing deposits

69,223

52,128

Restricted cash

-

1,764

Available-for-sale investment securities, at fair value

1,320,110

1,105,182

Stock in Federal Home Loan Bank, at cost

9,706

11,218

Loans receivable held for investment

4,676,281

4,738,693

Allowance for loan losses

(53,047)

(55,533)

Net loans

4,623,234

4,683,160

Loans held for sale, at lower of cost or fair value

15,728

18,817

Other

378,224

329,815

Goodwill

82,190

82,190

Total assets

$

6,618,907

$

6,421,357

Liabilities and shareholder's equity

Deposit liabilities-noninterest-bearing

$

1,710,698

$

1,639,051

Deposit liabilities-interest-bearing

4,041,628

3,909,878

Other borrowings

153,552

192,618

Other

107,558

101,635

Total liabilities

6,013,436

5,843,182

Common stock

1

1

Additional paid in capital

344,512

342,704

Retained earnings

279,956

257,943

Accumulated other comprehensive loss, net of tax benefits

Net unrealized losses on securities

$

(5,479)

$

(7,931)

Retirement benefit plans

(13,519)

(18,998)

(14,542)

(22,473)

Total shareholder's equity

605,471

578,175

Total liabilities and shareholder's equity

$

6,618,907

$

6,421,357

This information should be read in conjunction with the condensed consolidated financial statements and the notes thereto in HEI filings with the SEC.

EXPLANATION OF HEI'S USE OF CERTAIN UNAUDITED NON-GAAP MEASURES

HEI and Hawaiian Electric Company management use certain non-GAAP measures to evaluate the performance of HEI and the utility. Management believes these non-GAAP measures provide useful information and are a better indicator of the companies' core operating activities given the non-recurring nature of these items. Core earnings and other financial measures as presented here may not be comparable to similarly titled measures used by other companies. The accompanying tables provide a reconciliation of reported GAAP earnings to non-GAAP core earnings and the adjusted return on average common equity (ROACE) for HEI and the utility.

The reconciling adjustments from GAAP earnings to core earnings are limited to income, costs and associated taxes related to the terminated merger between HEI and NextEra Energy, Inc., the cancelled spin-off of ASB Hawaii, Inc., and the termination of the liquefied natural gas (LNG) contract which required the Hawaii Public Utilities Commission approval of the merger with NextEra Energy, Inc. For more information on the transactions, see HEI's Form 8-K filed on July 18, 2016 and HEI's Form 8-K filed on July 19, 2016. Management does not consider these items to be representative of the company's fundamental core earnings.

The accompanying table also provides the calculation of utility GAAP other operation and maintenance (O&M ) expense adjusted for costs related to the terminated merger discussed above. 'O&M-related net income neutral items' which are O&M expenses covered by specific surcharges or by third parties have also been excluded. These 'O&M-related net income neutral items' are grossed-up in revenue and expense and do not impact net income.

RECONCILIATION OF GAAP TO NON-GAAP MEASURES

Hawaiian Electric Industries, Inc. and Subsidiaries (HEI)

Unaudited

Three months ended
September 30

Nine months ended
September 30

($ in millions, except per share amounts)

2017

2016

2017

2016

HEI CONSOLIDATED (INCOME) EXPENSES RELATED TO THE TERMINATED MERGER WITH NEXTERA ENERGY AND CANCELLED SPIN-OFF OF ASB HAWAII

Pre-tax (income) expenses

$

-

$

(88.5)

$

-

$

(84.9)

Current income taxes (benefits)

-

24.7

-

24.7

After-tax (income) expenses

$

-

$

(63.8)

$

-

$

(60.3)

HEI CONSOLIDATED LNG CONTRACT COSTS

Pre-tax expenses

$

-

$

-

$

-

$

3.4

Current income taxes (benefits)

-

-

-

(1.3)

After-tax (income) expenses

$

-

$

-

$

-

$

2.1

HEI CONSOLIDATED NET INCOME

GAAP (as reported)

$

60.1

$

127.1

$

132.9

$

203.6

Excluding special items (after-tax):

(Income) expenses related to the terminated merger with NextEra Energy and cancelled spin-off of ASB Hawaii

-

(63.8)

-

(60.3)

Costs related to the terminated LNG contract

-

-

-

2.1

Non-GAAP (core) net income

$

60.1

$

63.3

$

132.9

$

145.4

HEI CONSOLIDATED DILUTED EARNINGS PER COMMON SHARE

GAAP (as reported)

$

0.55

$

1.17

$

1.22

$

1.88

Excluding special items (after-tax):

(Income) expenses related to the terminated merger with NextEra Energy and cancelled spin-off of ASB Hawaii

-

(0.59)

-

(0.56)

Costs related to the terminated LNG contract

-

-

-

0.02

Non-GAAP (core) diluted earnings per common share

$

0.55

$

0.58

$

1.22

$

1.34

Twelve months ended
September 30

2017

2016

HEI CONSOLIDATED RETURN ON AVERAGE COMMON EQUITY (ROACE) (simple average)

Based on GAAP

8.5

%

12.3

%

Based on non-GAAP (core)

8.5

%

9.5

%

Note: Columns may not foot due to rounding

Accounting principles generally accepted in the United States of America

The LNG contract was terminated as it was conditioned on the merger with NextEra Energy closing

Calculated as core net income divided by average GAAP common equity

RECONCILIATION OF GAAP TO NON-GAAP MEASURES

Hawaiian Electric Company, Inc. and Subsidiaries

Unaudited

Three months ended
September 30

Nine months ended
September 30

($ in millions)

2017

2016

2017

2016

HAWAIIAN ELECTRIC CONSOLIDATED COSTS RELATED TO THE TERMINATED MERGER WITH NEXTERA ENERGY

Pre-tax expenses

$

-

$

-

$

-

$

0.1

Current income tax benefits

-

-

-

-

After-tax expenses

$

-

$

-

$

-

$

0.1

HAWAIIAN ELECTRIC CONSOLIDATED LNG CONTRACT COSTS

Pre-tax expenses

$

-

$

-

$

-

$

3.4

Current income tax benefits

-

-

-

(1.3)

After-tax expenses

$

-

$

-

$

-

$

2.1

HAWAIIAN ELECTRIC CONSOLIDATED NET INCOME

GAAP (as reported)

$

47.5

$

47.0

$

94.6

$

108.2

Excluding special items (after-tax):

Costs related to the terminated merger with NextEra Energy

-

-

-

0.1

Costs related to the terminated LNG contract

-

-

-

2.1

Non-GAAP (core) net income

$

47.5

$

47.0

$

94.6

$

110.3

Twelve months ended
September 30

2017

2016

HAWAIIAN ELECTRIC CONSOLIDATED RETURN ON AVERAGE COMMON EQUITY (ROACE) (simple average)

Based on GAAP

7.16

%

8.11

%

Based on non-GAAP (core)

7.16

%

8.24

%

Three months ended
September 30

Nine months ended
September 30

($ in millions)

2017

2016

2017

2016

HAWAIIAN ELECTRIC CONSOLIDATED OTHER O&M EXPENSE

GAAP (as reported)

$

100.1

$

94.8

$

306.7

$

298.3

Excluding other O&M-related net income neutral items

0.7

1.4

2.7

4.6

Excluding costs related to the terminated merger with NextEra Energy

-

-

-

0.1

Excluding costs related to the terminated LNG contract

-

-

-

3.4

Non-GAAP (Adjusted other O&M expense)

$

99.4

$

93.4

$

304.0

$

290.2

Note: Columns may not foot due to rounding

Accounting principles generally accepted in the United States of America

The LNG contract was terminated as it was conditioned on the merger with NextEra Energy closing

Calculated as core net income divided by average GAAP common equity

Expenses covered by surcharges or by third parties recorded in revenues

Contact:

Clifford H. Chen

Telephone: (808) 543-7300

Treasurer & Manager, Investor Relations & Strategic Planning

E-mail: ir@hei.com

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SOURCE Hawaiian Electric Industries, Inc.

HEI - Hawaiian Electric Industries Inc. published this content on 02 November 2017 and is solely responsible for the information contained herein.
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