8-K 1 0001.txt FORM 8-K ================================================================================ 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: January 23, 2001 ================================================================================ Exact Name of Registrant Commission I.R.S. Employer as Specified in Its Charter File Number Identification No. --------------------------- ----------- ------------------ Hawaiian Electric Industries, Inc. 1-8503 99-0208097 Hawaiian Electric Company, Inc. 1-4955 99-0040500 ================================================================================ State of Hawaii ---------------------------------------------- (State or other jurisdiction of incorporation) 900 Richards Street, Honolulu, Hawaii 96813 ---------------------------------------------------------------- (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 -------------------------------------------------------------- (Former name or former address, if changed since last report.) ================================================================================ Item 5. Other Events News release ------------ Today, HEI issued the following news release: HAWAIIAN ELECTRIC INDUSTRIES, INC. ANNOUNCES YEAR END EARNINGS THAT INCLUDE A WRITE-OFF OF ITS PHILIPPINE INVESTMENT HONOLULU -- Hawaiian Electric Industries, Inc. (HEI) (NYSE - HE) announced 2000 net income from continuing operations of $45.7 million, or $1.41 per share, compared with $92.9 million, or $2.89 per share for 1999. The Company's results reflect unprecedented earnings strength from the electric utilities and the savings bank, offset by losses from and the write-off of the Company's remaining interest in East Asia Power Resources Corporation (EAPRC), an electricity generation company primarily operating in Manila and Cebu, the Philippines. The earnings growth at the utilities and the bank is a long awaited result on the heels of a protracted economic recession in Hawaii. The December 31, 2000 write-off, which amounts to $36.6 million or $1.12 per share, net of tax, results from continued losses primarily due to the devaluation of the Philippine peso, which was negatively impacted by political and economic instability in the Philippines. "We believe the decision to write off the Company's remaining investment in EAPRC is in the best interest of our shareholders because it limits HEI's exposure in the Philippines. Excluding the EAPRC losses and write-off, 2000 net income would have been approximately $106.7 million or $3.28 per share--an all-time high for HEI," said Robert F. Clarke, HEI's chairman, president and chief executive officer. In March 2000, HEI Power Corp. (HEIPC), a wholly owned subsidiary of HEI, paid $87.5 million for a 46% interest in EAPRC. The acquisition was made to strengthen HEIPC's position in capitalizing on the expected privatization of the Philippine National Power Corporation and high levels of forecasted growth in the Philippine electric generation and distribution industry. "Unfortunately, civil unrest in the Philippines, the impeachment trial of the President, severe devaluation of the peso and volatile fuel prices worked against us," said Clarke. In light of the losses incurred this year in the Philippines, the Company is evaluating its overall international strategy. Utility net income was up 16.0% to $87.3 million for 2000 from $75.2 million for 1999. "Our utility results benefited from a strengthened Hawaii economy and reflect process and other efficiency improvements the utilities have put in place over the last several years," said Clarke. Kilowatthour sales were up 3.2% in 2000 as compared with 1999, due in part to an increase in visitor arrivals and warmer weather. The savings bank also posted solid results this year with net income growing 14.7% to $40.6 million in 2000 versus $35.4 million in 1999. "This is the fourth straight year of double-digit net income growth for American Savings Bank," said Clarke. Net income grew due to an 11.5% increase in interest income and decreases in the provision 1 for loan losses. Interest income increased to $423.6 million in 2000 from $380.0 million in 1999, largely due to an increase in average interest earning assets. 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 contains "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", "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 quarterly period ended September 30, 2000 (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 Years ended ended December 31, December 31, (in thousands, except per share amounts) 2000 1999 2000 1999 ----------------------------------------------------- ----------------------------------------------------------- Revenues Electric utility $ 342,596 $287,858 $ 1,277,170 $ 1,055,204 Savings bank 117,616 105,250 450,882 409,913 International power (4,026) 1,207 (12,030) 4,464 Other 1,960 14,590 3,002 53,709 --------- -------- ----------- ----------- 458,146 408,905 1,719,024 1,523,290 --------- -------- ----------- ----------- Expenses Electric utility 306,043 244,853 1,084,079 880,490 Savings bank 100,059 90,737 380,841 349,561 International power 79,405 2,444 89,040 9,195 Other 3,130 6,293 9,717 50,173 --------- -------- ----------- ----------- 488,637 344,327 1,563,677 1,289,419 --------- -------- ----------- ----------- Operating income (loss) Electric utility 36,553 43,005 193,091 174,714 Savings bank 17,557 14,513 70,041 60,352 International power (83,431) (1,237) (101,070) (4,731) Other (1,170) 8,297 (6,715) 3,536 --------- -------- ----------- ----------- (30,491) 64,578 155,347 233,871 --------- -------- ----------- ----------- Interest expense--other than savings bank (20,132) (18,143) (78,621) (72,631) Allowance for borrowed funds used during construction 702 621 2,922 2,576 Preferred stock dividends of subsidiaries (502) (511) (2,007) (2,135) Preferred securities distributions of trust subsidiaries (4,009) (4,009) (16,035) (16,025) Allowance for equity funds used during construction 1,278 1,026 5,380 4,228 --------- -------- ----------- ----------- Income from continuing operations before income taxes (53,154) 43,562 66,986 149,884 Income taxes (28,777) 15,810 21,242 56,990 --------- -------- ----------- ----------- Income from continuing operations (24,377) 27,752 45,744 92,894 Discontinued operations-gain on disposal - 3,953 - 3,953 --------- -------- ----------- ----------- Net income $ (24,377) $ 31,705 $ 45,744 $ 96,847 ========= ======== =========== =========== Per common share Basic earnings (loss) Continuing operations $ (0.74) $ 0.86 $ 1.41 $ 2.89 Discontinued operations - 0.12 - 0.12 --------- -------- ----------- ----------- $ (0.74) $ 0.98 $ 1.41 $ 3.01 ========= ======== =========== =========== Diluted earnings (loss) Continuing operations $ (0.74) $ 0.86 $ 1.40 $ 2.88 Discontinued operations - 0.12 - 0.12 --------- -------- ----------- ----------- $ (0.74) $ 0.98 $ 1.40 $ 3.00 ========= ======== =========== =========== Dividends $ 0.62 $ 0.62 $ 2.48 $ 2.48 ========= ======== =========== =========== Weighted-average number of common shares outstanding 32,864 32,213 32,545 32,188 ========= ======== =========== =========== Adjusted weighted-average shares 33,013 32,308 32,687 32,291 ========= ======== =========== =========== Income from continuing operations by segment Electric utility $ 14,527 $ 18,602 $ 87,286 $ 75,222 Savings bank 10,198 9,331 40,630 35,412 International power (84,344) (1,429) (103,586) (5,089) Other 35,242 1,248 21,414 (12,651) --------- -------- ----------- ----------- Income from continuing operations $ (24,377) $ 27,752 $ 45,744 $ 92,894 ========= ======== =========== ===========
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 years ended December 31, 1999 and December 31, 2000 (when filed) and the consolidated financial statements and the notes thereto in HEI's Quarterly Reports on SEC Forms 10-Q for the quarters ended March 31, 2000, June 30, 2000 and September 30, 2000. 3 HAWAIIAN ELECTRIC INDUSTRIES, INC. SUPPLEMENTAL DATA TO 4TH QUARTER 2000 EARNINGS RELEASE (Unaudited)
Hawaiian Electric Company, Inc. (HECO) and subsidiaries Years ended Consolidated Statements of Income December 31, ------------------------------------------------------- --------------------------- (in thousands) 2000 1999 ------------- ----------- Operating revenues $ 1,270,635 $ 1,050,323 ------------ ----------- Operating expenses Fuel oil 362,905 216,693 Purchased power 311,207 275,691 Other operation 123,779 136,303 Maintenance 66,069 57,425 Depreciation 98,517 93,301 Taxes, other than income taxes 119,784 99,788 Income taxes 55,213 48,281 ------------ ----------- 1,137,474 927,482 ------------ ----------- Operating income 133,161 122,841 ------------ ----------- Other income Allowance for equity funds used during construction 5,380 4,228 Other, net 4,555 3,826 ------------ ----------- 9,935 8,054 ------------ ----------- Income before interest and other charges 143,096 130,895 ------------ ----------- Interest and other charges Interest on long-term debt 40,134 40,133 Amortization of net bond premium and expense 1,938 1,634 Other interest charges 6,990 6,694 Allowance for borrowed funds used during construction (2,922) (2,576) Preferred stock dividends of subsidiaries 915 945 Preferred securities distributions of trust subsidiaries 7,675 7,665 ------------ ----------- 54,730 54,495 ------------ ----------- Income before preferred stock dividends of HECO 88,366 76,400 Preferred stock dividends of HECO 1,080 1,178 ------------ ----------- Net income for common stock $ 87,286 $ 75,222 ============ =========== Other electric utility information ------------------------------------- Kilowatthour sales (millions) 9,272 8,985 Cooling degree days (Oahu) 4,707 4,421
4 Hawaiian Electric Industries, Inc. Supplemental Data to 4th Quarter Earnings Release (Unaudited) Page 2
American Savings Bank, F.S.B. and subsidiaries Years ended Consolidated Income statement data December 31, ---------------------------------------------- ------------------------ (in thousands) 2000 1999 ---------- ---------- Interest income $ 423,575 $ 379,979 Interest expense (238,875) (207,168) ---------- --------- Net interest income 184,700 172,811 Provision for loan losses (13,050) (16,500) Other income 27,307 29,934 Operating, administrative and general expenses (128,916) (125,893) ---------- --------- Operating income 70,041 60,352 Income taxes (23,774) (19,528) ---------- --------- Income before preferred stock dividends 46,267 40,824 Preferred stock dividends (5,412) (5,412) Minority interest (225) - ---------- --------- Net income $ 40,630 $ 35,412 ========== =========
###(End of news release)### 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/ Robert F. Mougeot /s/ Richard A. von Gnechten -------------------------------------- ------------------------------------- Robert F. Mougeot Richard A. von Gnechten Financial Vice President, Financial Vice President of HECO Chief Financial Officer and Treasurer (Principal Financial Officer of HECO) (Principal Financial Officer of HEI) Date: January 23, 2001 Date: January 23, 2001 6