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Hawaiian Electric Industries (HE) Q1 2025 Earnings Call May 09, 2025 04:30 PM ET Company Participants Mateo Garcia - Director of Investor RelationsScott Seu - President & Chief Executive OfficerScott Deghetto - Executive VP, CFO & TreasurerMike Brown - Head of DesignShelee Kimura - President & Chief Executive Officer, Hawaiian ElectricMichael Lonegan - Director - Equity Research Conference Call Participants Julien Dumoulin-Smith - II-Ranked & 'Hall of Fame' Research Analyst covering Power, Utilities & Clean ...

Financial Data and Key Metrics Changes - In Q1 2025, the company generated net income of $26.7 million or $0.15 per share, which includes a $13.2 million pre-tax loss on the sale of Pacific Current and $4.5 million in Maui wildfire-related expenses [18][19] - Consolidated core net income was $39.8 million or $0.23 per share, compared to $28.4 million or $0.26 per share in Q1 2024 [19] - Utility core net income increased to $49.7 million from $44.2 million in Q1 2024, driven by better heat rate performance and higher revenues [19] Business Line Data and Key Metrics Changes - The utility segment showed improved performance with higher revenues from the annual revenue adjustment mechanism and lower bad debt expenses, despite increased wildfire mitigation program expenses [19] - The holding company reported a core net loss of $9.9 million, reduced from $15.8 million in Q1 2024, due to higher interest income from cash reserves [20] Market Data and Key Metrics Changes - The company had approximately $492 million in unrestricted cash at the holding company level and $130 million at the utility level as of the end of Q1 2025 [20] - The holding company cash balance included $384 million from the sale of American Savings Bank, which was used to retire debt [21] Company Strategy and Development Direction - The company is moving towards a simpler business model focused solely on regulated utility operations following the sale of American Savings Bank and the divestiture of Pacific Current assets [8][12] - The company aims to enhance safety, reliability, and resilience through significant investments in the utility's generation system and electric grid [9] - The company remains committed to advancing Hawaii's clean energy goals, targeting 100% renewable portfolio standard (RPS) and net zero by 2045 [11] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the company's future, citing improved financial strength and a clearer path to resolving the Maui wildfire tort litigation [11][64] - The company anticipates that the legislative measures passed will positively impact credit ratings and reduce wildfire liability risk exposure [12][25] Other Important Information - The company reinstated a quarterly dividend of $10 million for Q1 2025 after a temporary suspension [23] - The Hawaii State Legislature passed several bills aimed at supporting the utility's operations and mitigating wildfire risks, including establishing a liability cap and a potential wildfire fund [12][15] Q&A Session Summary Question: Anticipated feedback from rating agencies if SB 897 is signed into law - Management expects positive feedback from rating agencies, indicating that key milestones will be credit positives [25] Question: How will SB 897 impact the wildfire fund? - The bill requires the Public Utilities Commission (PUC) to study the viability of a wildfire fund and provide recommendations [27] Question: What is the nature of the liability cap in SB 897? - The bill directs the PUC to establish an aggregate liability cap, considering various factors such as market cap and rate base [31][33] Question: Financing strategy for remaining settlement payments - Management indicated that financing will be a combination of debt and equity, with no immediate plans for financing the payments [35][45] Question: Planned rate case filing and test year - The utility will file for rebasing target revenues ahead of the second multiyear rate period starting in 2027, with a 2026 test year expected [46][51] Question: Why did the legislature defer decisions on the liability cap to the PUC? - The legislature believed the PUC could conduct a more thorough and technical review of the issues involved [56] Question: Governor's position on the liability cap - Management noted that the governor's office was actively involved in the legislative process and will have input once the PUC completes its rulemaking [59]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Exact Name of Registrant as Specified in Its Charter Commission File Number I.R.S. Employer Identification No. HAWAIIAN ELECTRIC INDUSTRIES, INC. 1-8503 99-0208097 and Principal Subsidiary HAWAIIAN E ...

HEI Exhibit 99 NEWS RELEASE May 9, 2025 Contact: Mateo Garcia Telephone: (808) 543-7300 Director, Investor Relations E-mail: ir@hei.com HEI REPORTS FIRST QUARTER 2025 RESULTS HONOLULU - Hawaiian Electric Industries, Inc. (NYSE - HE) (HEI) today reported net income for the first quarter of 2025 of $27 million, or $0.15 per share. Excluding Maui wildfire-related expenses, the loss recorded at Pacific Current on the sale of Hamakua Energy and net income from discontinued operations in 2024, Core income from co ...

HEI 1Q 2025 Financial Results May 9, 2025 Non-GAAP Financial Information This presentation refers to certain financial measures that were not prepared in accordance with U.S. generally accepted accounting principles, including Core Earnings and Core Net Income. Reconciliations of those non-GAAP financial measures to the most directly comparable GAAP financial measures can be found in the Appendix herein. See Appendix for definition of Core Earnings and Core EPS. 2 Repositioning for the Future Advancing Our ...

Financial Impact and Challenges - The company reported significant financial impacts due to the Maui windstorm and wildfires, with potential liabilities from lawsuits and regulatory penalties that may result in unrecoverable costs[26] - The company anticipates an increase in insurance premiums and challenges in obtaining wildfire and general liability insurance coverage at reasonable rates[26] - The company is facing uncertainties regarding access to capital and credit markets due to costs related to the Maui windstorm and wildfires[26] - The company is experiencing high and volatile fuel prices, which are increasing working capital requirements and customer bills[27] - The company is assessing the ability to recover costs associated with tariffs and other factors impacting prices while ensuring reasonable returns on capital investments[27] Environmental and Regulatory Commitments - The company is committed to addressing environmental, social, and governance priorities, including safety, reliability, and resilience in response to extreme weather events[27] - The company is focused on executing its Integrated Grid Plan, which was accepted by the Public Utilities Commission in 2024, to transition towards 100% renewable energy[27] - The company is subject to various regulatory actions that may alter costs to produce electricity and accelerate the move to renewable generation[1] - Hawaiian Electric aims to cut carbon emissions from power generation by 70% by 2030 compared to 2005 levels, with a commitment to achieve net zero carbon emissions by 2045 or sooner[63] - The Utilities expect to meet or exceed the State of Hawaii's Renewable Portfolio Standards (RPS) goals despite challenges in achieving the 2030 carbon reduction target[64] Workforce and Employee Development - The total number of employees decreased from 3,706 in 2022 to 2,602 in 2024, with Hawaiian Electric and its subsidiaries employing 2,533 full-time employees in 2024[45] - A new three-year collective bargaining agreement was ratified, providing for a 3% general wage increase each year from November 1, 2024, through October 31, 2027[46] - The company is focused on fostering an inclusive culture to enhance collaboration and innovation, recognizing the importance of a diverse workforce[47] - The company has invested in employee development programs, including leadership training and technical skills enhancement[50] - The company is expanding its strategic workforce planning initiative to support future transformation plans[55] Operational Performance and Sales - In 2024, Hawaiian Electric's customer accounts reached 310,336, generating electric sales revenues of $2,246,646,000, a decrease from $2,324,044,000 in 2023[66] - The electric utilities' revenues accounted for approximately 100% of HEI's consolidated revenues in 2024, with a net loss of 93% of HEI's loss from continuing operations[60] - Total MWh sales for 2024 reached 8,218.9 thousand, slightly down from 8,226.7 thousand in 2023, marking a decrease of 0.1%[73] - Net generated MWh for 2024 was 5,251.6 thousand, a decrease of 1.7% from 5,343.0 thousand in 2023[73] - Customer-sited solar MWh increased to 1,691.2 thousand in 2024, up 6.7% from 1,585.5 thousand in 2023[73] Infrastructure and Capacity - The firm capacity from Hawaiian Electric's major PPAs accounted for 19% of total net generating and firm purchased capacity on Oahu as of December 31, 2024[80] - The reserve margin across the islands served was 41.4% as of December 31, 2024, indicating a healthy buffer for peak demand[76] - The total fuel storage capacity for Hawaiian Electric is 1,025,000 barrels of LSFO at Barbers Point Tank Farm and 771,000 barrels of LSFO across various generation sites[123] - Hawaiian Electric has a total of 126.5 acres of land for substations, transformer vaults, and distribution facilities, with additional leased properties for operational purposes[124] - The Utilities own and operate various generation sites across Oahu, Hawaii, and Maui, with a mix of fuel types including LSFO, diesel, and renewable sources[122] Regulatory Compliance and Environmental Management - The Utilities have implemented procedures to monitor compliance with TSCA regulations regarding the handling of PCBs and have a program to replace PCB transformers and capacitors[117] - The Utilities are subject to various environmental regulations, including the Emergency Planning and Community Right-to-Know Act, requiring reporting of hazardous chemicals[116] - Hawaiian Electric's operations are governed by state and federal regulations, including the Endangered Species Act, to protect threatened or endangered species[121] - The Utilities have discovered leaking oil-containing equipment and are addressing these releases in compliance with applicable regulatory requirements[120] Future Plans and Strategic Initiatives - The company is undergoing a comprehensive review of strategic options for certain assets of Pacific Current, including the sale of Hamakua Holdings, LLC, expected to close in March 2025[42] - The company has suspended new investments following the Maui windstorm and wildfires while reviewing strategic options[40] - The Utilities operate 32 public DC fast chargers and have filed for an additional 150 DC fast chargers and 150 level 2 charging stations[100] - The Utilities completed the 18-month Smart Charge Hawaii Telematics pilot in December 2024, focusing on electric vehicle infrastructure[99] - The Amended and Restated Power Purchase Agreement with PGV was approved by the PUC on December 29, 2023, allowing for expanded capacity[86]

HEI 4Q and Full Year 2024 Financial Results February 21, 2025 Non-GAAP Financial Information This presentation refers to certain financial measures that were not prepared in accordance with U.S. generally accepted accounting principles. Reconciliations of those non-GAAP financial measures to the most directly comparable GAAP financial measures can be found in the Appendix herein. Executed on strategic objectives communicated following the Maui wildfires Signed settlement agreements in the Maui wildfire tort ...

Financial Data and Key Metrics Changes - The company generated a loss from continuing operations of $1.3 billion for the full year 2024, which includes wildfire settlement accruals of $1.9 billion pretax and other Maui wildfire-related expenses [28][29] - Consolidated core net income was $124 million in 2024, down from $152 million in 2023, while utility core net income decreased to $181 million from $195 million in 2023 [29] - The average residential bill decreased by 7% in 2024, reflecting the company's efforts to reduce customer rates [14] Business Line Data and Key Metrics Changes - The sale of 90.1% of American Savings Bank (ASB) for $405 million was completed, with net proceeds of approximately $380 million used to pay down holding company debt [25][26] - ASB's 2024 results showed a net loss from discontinued operations of $103 million compared to a net income of $53 million in 2023 [27] Market Data and Key Metrics Changes - The utility achieved a 36% renewable portfolio standard in 2024, up from 33% in 2023, on track to reach an interim goal of 40% by 2030 [14] - The company ended 2024 with the strongest liquidity position in its history, bolstered by a successful equity offering that raised $558 million [10][23] Company Strategy and Development Direction - The company aims to focus on its core utility business following the sale of ASB, which simplifies its strategy and regulatory position [11][12] - A three-year action plan for wildfire safety with an estimated cost of $450 million has been established, with approximately $400 million expected to be capital expenditures [18][19] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the positive outcome of the Hawaii Supreme Court ruling, which is a significant step towards finalizing the settlement agreement related to the Maui wildfires [21][22] - The company plans to continue pursuing supportive legislation and aims to return to investment grade [24][86] Other Important Information - The company invested approximately $120 million in wildfire safety improvements in 2024, including a public safety power shutoff program and upgrades to utility infrastructure [16][17] - The updated wildfire safety strategy was filed with the Public Utilities Commission (PUC) in January, building upon immediate actions taken after the August 2023 wildfires [18] Q&A Session Summary Question: Confidence in the settlement proceeding without interference from insurers - Management expressed confidence in the positive outcome of the Hawaii Supreme Court decision, which is a major step towards finalizing the settlement agreement [36][37] Question: Capital expenditure expectations and financing plans - The company is refining its three-year capital forecast, expecting an increase in capital expenditures, particularly for wildfire safety and other approved projects [42][49] Question: Legislative session and potential impacts on customer bills - Management noted that discussions are ongoing regarding the impacts on customers and the establishment of a wildfire recovery fund, emphasizing the importance of balancing customer and shareholder needs [52][66] Question: Securitization and rating agency expectations - Management indicated that there is a good understanding of the benefits of securitization for securing lower-cost financing, which would ultimately benefit customers [71][73]

Financial Performance - HEI reported a full year 2024 net loss of $1,426 million, or $11.23 per share, compared to a net income of $199 million, or $1.81 per share in 2023[2]. - Core income from continuing operations for 2024 was $124 million, or $0.98 per share, down from $152 million, or $1.38 per share in 2023[2]. - The fourth quarter 2024 net loss was $68 million, or $0.40 per share, compared to net income of $49 million, or $0.44 per share in Q4 2023[2]. - Hawaiian Electric's full-year net loss was $1,226 million, compared to net income of $194 million in 2023, primarily due to pre-tax wildfire-related expenses of $2,019 million[6][7]. - The loss from discontinued operations totaled $103 million for 2024, compared to net income of $53 million in 2023[10]. - The holding and other companies reported a net loss of $96 million in 2024, up from $48 million in 2023, primarily due to higher wildfire-related expenses[11]. - The company reported a GAAP net loss of $1,226,362,000 for the year ended December 31, 2024, compared to a profit of $193,952,000 in 2023[32]. - Non-GAAP (core) net income for the year ended December 31, 2024, was $180,739,000, down from $195,068,000 in 2023, a decrease of 7%[32]. - The GAAP net loss reported for the year ended December 31, 2024, was $(96,161,000), significantly higher than the $(48,076,000) loss in 2023[33]. - Non-GAAP (Core) net loss for the year ended December 31, 2024, was $(56,438,000), compared to $(43,371,000) in 2023[33]. Revenue and Expenses - Total revenues for Q4 2024 were $799,180,000, a decrease of 6.4% from $853,424,000 in Q4 2023[23]. - Electric utility revenues decreased to $796,174,000 in Q4 2024 from $849,982,000 in Q4 2023, reflecting a decline of 6.3%[26]. - Total expenses for Q4 2024 were $745,518,000, down 4.3% from $779,093,000 in Q4 2023[23]. - Operating income for Q4 2024 was $53,662,000, compared to $74,331,000 in Q4 2023, representing a decline of 28%[23]. - The average fuel oil cost per barrel decreased to $104.38 in Q4 2024 from $132.47 in Q4 2023[26]. - Total pretax expenses for the year ended December 31, 2024, were $27,203,000, compared to $12,304,000 in 2023, reflecting a substantial increase[33]. Wildfire-Related Expenses - The company recorded a provision of $1,875,000,000 for wildfire tort-related claims in 2024[26]. - Total Maui wildfire-related pretax expenses for 2024 reached $2,046,030,000, significantly higher than $127,112,000 in 2023[31]. - Wildfire tort-related claims amounted to $1,915,000,000 for the year ended December 31, 2024, compared to $75,000,000 in 2023[31]. - Total Maui windstorm and wildfire-related expenses, net of insurance recoveries, for 2024 were $1,895,086,000, compared to $1,503,000 in 2023[32]. - Total Maui windstorm and wildfires related expenses, net of insurance recoveries, were $4,040,000 for Q4 2024, compared to $1,254,000 in Q4 2023[33]. Legal and Interest Expenses - Legal expenses related to Maui wildfire claims totaled $13,449,000 for Q4 2024, compared to $23,768,000 in Q4 2023, a reduction of 43%[31]. - Legal expenses for the three months ended December 31, 2024, amounted to $2,212,000, a decrease from $5,282,000 in the same period of 2023[33]. - The company incurred interest expenses of $14,834,000 for the year ended December 31, 2024, significantly higher than $2,600,000 in 2023[31]. - Interest expenses for the year ended December 31, 2024, were $3,666,000, compared to $1,377,000 in 2023, indicating a significant increase[33]. Dividends and Shareholder Returns - The utility dividend to HEI remains suspended due to limited cash needs following recent equity issuance[9]. - Non-GAAP diluted earnings per share for Q4 2024 was $0.20, down from $0.34 in Q4 2023, a decline of 41%[31]. - Basic earnings per common share for continuing operations were $0.17 in Q4 2024, down from $0.41 in Q4 2023[23]. Strategic Changes - HEI sold 90.1% of American Savings Bank, simplifying its strategy and regulatory position while allowing a focus on the utility business[3][5]. - The utility achieved a 36% renewable portfolio standard in 2024, on track to meet the 40% milestone by 2030[3][5].