Share-based compensation (Tables)

6 Months Ended

Jun. 30, 2013

Share-based compensation

Schedule of share-based compensation expense and related income tax benefit

	Three months ended June 30				Six months ended June 30
(in millions)	2013		2012		2013		2012
Share-based compensation expense (1)	$	1.1	$	1.7	$	3.0	$	3.5
Income tax benefit	0.4		0.6		1.1		1.2

(1) The Company has not capitalized any share-based compensation cost.

Schedule of nonqualified stock options activity and statistics

	Three months ended  June 30				Six months ended June 30
(dollars in thousands, except prices)	2013		2012		2013		2012
Shares exercised	12,000		21,500		14,000		33,500
Weighted-average exercise price	$	20.49	$	20.93	$	20.49	$	21.20
Cash received from exercise	$	246	$	450	$	287	$	710
Intrinsic value of shares exercised (1)	$	113	$	174	$	128	$	265
Tax benefit realized for the deduction of exercises	$	44	$	68	$	50	$	103

(1) Intrinsic value is the amount by which the fair market value of the underlying stock and the related dividend equivalents exceeds the exercise price of the option.

Schedule of stock appreciation rights by grant year

June 30, 2013		Outstanding & Exercisable (Vested)
Year of grant	Range of exercise prices	Number of shares underlying SARs	Weighted-average remaining contractual life	Weighted-average exercise price
2004	$26.02	62,000	0.8	$	26.02
2005	26.18	102,000	1.8	26.18
	$26.02 –26.18	164,000	1.4	$	26.12

Schedule of stock appreciation rights activity and statistics

	Three months ended June 30			Six months ended June 30
(dollars in thousands, except prices)	2013	2012		2013	2012
Shares underlying SARS exercised	—	112,000		—	112,000
Weighted-average price of shares exercised	—	$	26.17	—	$	26.17
Intrinsic value of shares exercised (1)	—	$	194	—	$	194
Tax benefit realized for the deduction of exercises	—	$	76	—	$	76

(1) Intrinsic value is the amount by which the fair market value of the underlying stock and the related dividend equivalent rights exceeds the exercise price of the right.

Schedule of restricted share and stock awards

	Three months ended June 30							Six months ended June 30
	2013			2012				2013			2012
	Shares	(1)		Shares		(1)		Shares	(1)		Shares		(1)
Outstanding, beginning of period	9,005	$	22.21	38,107		$	23.83	9,005	$	22.21	46,807		$	24.45
Granted	—	—		—		—		—	—		—		—
Vested	—	—		(23,300	)	24.71		—	—		(32,000	)	25.38
Forfeited	—	—		—		—		—	—		—		—
Outstanding, end of period	9,005	$	22.21	14,807		$	22.45	9,005	$	22.21	14,807		$	22.45

(1) Weighted-average grant-date fair value per share based on the closing or average price of HEI common stock on the date of grant.

Schedule of restricted stock units

	Three months ended June 30								Six months ended June 30
	2013				2012				2013				2012
	Shares		(1)		Shares		(1)		Shares		(1)		Shares		(1)
Outstanding, beginning of period	301,145		$	25.15	318,551		$	22.80	315,094		$	22.82	247,286		$	21.80
Granted	—		—		2,334	(2)	26.75		107,231	(3)	26.89		94,846	(4)	26.00
Vested	(832	)	26.60		(250	)	26.25		(114,044	)	20.34		(21,497	)	24.97
Forfeited	—		—		(1,564	)	25.53		(7,968	)	25.26		(1,564	)	25.53
Outstanding, end of period	300,313		$	25.15	319,071		$	22.81	300,313		$	25.15	319,071		$	22.81

(1) Weighted-average grant-date fair value per share based on the average price of HEI common stock on the date of grant.

(2) Total weighted-average grant-date fair value of $62,000.

(3) Total weighted-average grant-date fair value of $2.9 million.

(4) Total weighted average grant date fair value of $2.5 million.

Schedule of Long-Term Incentive Plan (LTIP) linked to total return to shareholders

	Three months ended June 30							Six months ended June 30
	2013			2012				2013				2012
	Shares	(1)		Shares		(1)		Shares		(1)		Shares		(1)
Outstanding, beginning of period	235,064	$	32.87	239,470		$	29.12	239,256		$	29.12	197,385		$	25.94
Granted	—	—		1,442		30.71		89,533		32.69		78,924	(2)	30.71
Vested	—	—		—		—		(87,753	)	22.45		(35,397	)	14.85
Forfeited	—	—		(1,505	)	30.39		(5,972	)	32.96		(1,505	)	30.39
Outstanding, end of period	235,064	$	32.87	239,407		$	29.12	235,064		$	32.87	239,407		$	29.12

(1) Weighted-average grant-date fair value per share determined using a Monte Carlo simulation model.

(2) Total weighted-average grant-date fair value of $2.4 million.

Schedule of assumptions used to determine the fair value of Long-Term Incentive Plan (LTIP) linked to total return to shareholders (TRS)

	2013	2012
Risk-free interest rate	0.38%	0.33%
Expected life in years	3	3
Expected volatility	19.4%	25.3%
Range of expected volatility for Peer Group	12.4% to 25.3%	15.5% to 34.5%
Grant date fair value (per share)	$32.69	$30.71

Schedule of Long-Term Incentive Plan (LTIP) linked to other performance conditions

	Three months ended June 30								Six months ended June 30
	2013				2012				2013				2012
	Shares		(1)		Shares		(1)		Shares		(1)		Shares		(1)
Outstanding, beginning of period	341,824		$	26.00	297,602		$	23.92	247,175		$	25.04	182,498		$	22.63
Granted	—		—		3,600	(2)	26.75		118,895		26.89		118,704	(3)	26.00
Vested	—		—		—		—		(18,275	)	18.95		—		—
Cancelled	(37,351	)	24.96		—		—		(37,351	)	24.96		—		—
Forfeited	—		—		(6,018	)	24.23		(5,971	)	25.94		(6,018	)	24.23
Outstanding, end of period	304,473		$	26.12	295,184		$	23.95	304,473		$	26.12	295,184		$	23.95

(1) Weighted-average grant-date fair value per share based on the average price of HEI common stock on the date of grant.

(2) Total weighted-average grant-date fair value of $0.1 million (at target performance levels).

(3) Total weighted-average grant-date fair value of $3.1 million (at target performance levels).