HEI(HE) - 2025 Q1 - Quarterly Results

Q1 2025 Financial Highlights and Corporate Update Overall Performance and CEO Remarks HEI reported Q1 2025 GAAP net income of $27 million, with core income from continuing operations at $40 million, reflecting financial recovery and legislative progress Q1 2025 vs Q1 2024 Performance Summary | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | GAAP Net Income | $27 million | - | | GAAP EPS | $0.15 | - | | Core Income (Continuing Ops) | $40 million | $28 million | | Core EPS (Continuing Ops) | $0.23 | $0.26 | - Key strategic and legislative achievements during the quarter include: - Debt Reduction: Completed a $384 million debt reduction at the holding company using proceeds from the American Savings Bank sale[4] - Asset Sale: Pacific Current completed the sale of its largest asset, Hamakua Energy, resulting in a $13 million pre-tax loss[5] - Critical Legislation: The Hawaii State Legislature passed bills to fund the state's contribution to the Maui wildfire settlement, establish a liability cap for future wildfires, and protect clean energy procurement[6] Segment Performance Hawaiian Electric Company (Utility) The utility segment's Q1 2025 net income increased to $48 million, with core net income rising to $50 million, driven by higher revenues and improved performance Utility Net Income (Q1 2025 vs Q1 2024) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | GAAP Net Income | $48 million | $39 million | | Core Net Income | $50 million | $44 million | - Key drivers for the increase in utility net income include: - $7 million in higher revenues, primarily from the annual revenue adjustment mechanism[8] - $5 million positive impact from better heat rate performance[8] - $1 million in lower O&M expenses[8] - The Hawaiian Electric Board of Directors declared a $10 million cash dividend payable to HEI for the first quarter of 2025[10] Holding and Other Companies The Holding and Other Companies segment reported a Q1 2025 GAAP net loss of $21 million, primarily due to an asset sale, while core net loss improved to $10 million Holding and Other Companies Net Loss (Q1 2025 vs Q1 2024) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | GAAP Net Loss | ($21 million) | ($18 million) | | Core Net Loss | ($10 million) | ($16 million) | - The higher net loss was primarily due to a $13 million pre-tax loss from Pacific Current's sale of Hamakua Energy[11] Financial Statements HEI Consolidated Statements of Income HEI's consolidated revenues decreased to $744.1 million in Q1 2025, with net income for common stock falling to $26.7 million due to the absence of discontinued operations income present in Q1 2024 HEI Consolidated Income Statement Highlights (in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Total Revenues | $744,070 | $792,014 | | Total Operating Income | $62,420 | $50,887 | | Income from Continuing Ops | $27,144 | $21,661 | | Net Income for Common Stock | $26,671 | $42,122 | | Diluted EPS | $0.15 | $0.38 | Hawaiian Electric Company Statements of Income The electric utility's revenues decreased to $738.4 million in Q1 2025, primarily due to lower fuel costs, while operating income increased to $75.9 million and net income rose to $47.8 million Hawaiian Electric Income Statement Highlights (in thousands) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenues | $738,366 | $788,578 | | Total Expenses | $662,429 | $725,223 | | Operating Income | $75,937 | $63,355 | | Net Income for Common Stock | $47,816 | $39,221 | Utility Operational Data | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Kilowatthour sales (millions) | 1,965 | 1,906 | | Average fuel oil cost per barrel | $104.55 | $121.84 | Reconciliation of GAAP to Non-GAAP Measures Explanation of Non-GAAP Measures HEI uses non-GAAP 'Core' financial measures to assess fundamental operating performance by excluding non-representative items like Maui wildfire costs and asset sale losses - Non-GAAP "Core" measures are used to evaluate performance by excluding certain items to provide a better indicator of core operating activities[27] - The primary reconciling adjustments are costs related to the Maui wildfires and the loss on sale from the strategic review of Pacific Current[27] HEI Consolidated Reconciliation HEI's Q1 2025 GAAP income from continuing operations of $26.7 million was adjusted to a Non-GAAP (Core) income of $39.8 million by excluding wildfire expenses and a subsidiary sale loss HEI Consolidated GAAP to Non-GAAP (Core) Reconciliation - Q1 2025 (in thousands) | Description | Amount | | :--- | :--- | | GAAP income - continuing operations | $26,671 | | After-tax Maui wildfire expenses | $3,362 | | After-tax loss on sale of a subsidiary | $9,809 | | Non-GAAP (Core) income - continuing operations | $39,842 | HEI Consolidated Diluted EPS Reconciliation - Q1 2025 | Description | Amount | | :--- | :--- | | GAAP Diluted EPS - continuing operations | $0.15 | | Non-GAAP (Core) Diluted EPS - continuing operations | $0.23 | Hawaiian Electric (Utility) Reconciliation The utility's Q1 2025 GAAP net income of $47.8 million was adjusted for $1.9 million in wildfire-related expenses, resulting in a Non-GAAP (Core) net income of $49.7 million Hawaiian Electric GAAP to Non-GAAP (Core) Reconciliation - Q1 2025 (in thousands) | Description | Amount | | :--- | :--- | | GAAP net income | $47,816 | | Total after-tax Maui wildfire related expenses | $1,893 | | Non-GAAP (Core) net income | $49,709 | Holding and Other Companies Reconciliation The Holding and Other Companies' Q1 2025 GAAP net loss of $21.1 million was adjusted to a Non-GAAP (Core) net loss of $9.9 million after accounting for wildfire expenses and a subsidiary sale loss Holding and Other Co. GAAP to Non-GAAP (Core) Reconciliation - Q1 2025 (in thousands) | Description | Amount | | :--- | :--- | | GAAP net loss | ($21,145) | | After-tax Maui wildfire related expenses | $1,469 | | After-tax loss on sale of a subsidiary | $9,809 | | Non-GAAP (Core) net loss | ($9,867) |