Hawaiian Electric Industries Reports Second Quarter 2014 Earnings

      Hawaiian Electric Industries Reports Second Quarter 2014 Earnings  Consolidated Earnings Per Share of $0.41  Utility and Bank Deliver Results In Line with Expectations  PR Newswire  HONOLULU, Aug. 11, 2014  HONOLULU, Aug. 11, 2014 /PRNewswire/ -- Hawaiian Electric Industries, Inc. (NYSE - HE) (HEI) today reported consolidated net income for common stock for the second quarter of 2014 of $41.4 million, or $0.41 diluted earnings per share (EPS), compared to $40.6 million, or $0.41 diluted EPS for the second quarter of 2013.  "HEI's financial results were in line with internal expectations. Our utilities are aggressively managing costs and redirecting savings to accelerate investments for the benefit of our customers. We are making investments to improve reliability, increase the amount of renewables and pave the way for expected lower costs for customers," said Constance H. Lau, HEI president and chief executive officer.  "American Savings Bank continued to deliver solid results with year-to-date annualized loan growth of 6.5% which helped offset the impact of the continued low interest rate environment. American paid dividends of $9.75million to HEI in the quarter while maintaining strong capital levels," added Lau.  HAWAIIAN ELECTRIC COMPANY CONTINUES INVESTMENTS FOR IMPROVED RELIABILITY TO BETTER SERVE OUR CUSTOMERS  Hawaiian Electric Company's^1 net income for the second quarter of 2014 was $34.2million comparedto $28.7 million in the second quarter of 2013. The $5.5 million increase from the prior year was driven by the following items (on an after-tax basis):    oNet revenues^2 were $11 million higher compared to the second quarter of     2013 primarily due to $8 million in 2014 revenues attributable to the     recovery of costs for clean energy and reliability investments and a $4     million refund to customers recorded in the second quarter 2013 resulting     from the final Maui County 2012 rate case decision.  These increases were partially offset by the following (on an after-tax basis):    oOperations and maintenance (O&M) expenses^3 were $2 million higher in the     second quarter of 2014 compared to the same quarter last year. This is     largely due to expenses related to installing smart grid technologies as     part of our grid modernization program and reversals in the second quarter     of 2013 of previously expensed costs, partially offset by savings from the     deactivation of generating units;   oDepreciation expense for the second quarter of 2014 was $2 million higher     as a result of increasing investments for integration of more renewable     energy, improved customer reliability and greater system efficiency; and   oInterest expense was $1 million higher in the second quarter of 2014 due     to new debt issued in the fourth quarter of 2013 to fund our clean energy     and reliability investments.  ^1 Hawaiian Electric Company, unless otherwise defined, refers to the three utilities, Hawaiian Electric Company, Inc. on Oahu, Maui Electric Company, Limited, and Hawaii Electric Light Company, Inc.  ^2 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 Consolidated Statements of Income.  ^3 Excludes net income neutral expenses covered by surcharges or by third parties of $3 million in the second quarter of 2014 and $2 million in the second quarter of 2013. See "Explanation of HEI's Use of Certain Unaudited Non-GAAP measures" and the related reconciliation.  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.  AMERICAN SAVINGS BANK CONTINUES TO DELIVER SOLID PERFORMANCE  American Savings Bank's (American) net income for the second quarter of 2014 was $11.7million compared to $14.5 million in the first, or linked, quarter of 2014 and $15.9 million in the second quarter of 2013.  Second quarter 2014 net income was $2.9 million lower than the linked quarter primarily driven by (on an after-tax basis) a first quarter $2 million gain on the sale of the municipal bond securities portfolio and a $1 million increase in noninterest expense due to higher branch security expense, product development expenses and the timing of expenses associated with debit cards.  Compared to the second quarter of 2013, net income decreased by$4.2million. The decrease was primarily driven by (on an after-tax basis): $1 million lower interchange fees due to the Durbin Amendment which placed a limit on interchange fees and became effective on July1,2013; $1million decrease in mortgage banking income; $1 million lower gain on sale of securities; and $1 million higher provision for loan losses.  Overall, American achieved solid profitability with a year-to-date annualized return on average equity of 9.9% and a return on average assets of 0.98%.  Please also refer to the American news release issued on July 30, 2014.  HOLDING AND OTHER COMPANIES  The holding and other companies' net losses were $4.5million in the second quarter of 2013 compared to $4.0 million in the second quarter of 2013. The higher net loss was due to higher administrative and general expenses partially offset by lower interest expense.  HEI WEBCAST AND CONFERENCE CALL TO DISCUSS EARNINGS AND EPS GUIDANCE  Hawaiian Electric Industries, Inc. will conduct a webcast and conference call to review its second quarter 2014 earnings and 2014 EPS guidance on Monday, August11, 2014 at 7:00a.m. Hawaii time (1:00 p.m. Eastern time). The event can be accessed through HEI's website at www.hei.comor by dialing (877) 474-9504, passcode:92297255 for the teleconference call. The presentation for the webcast will be on HEI's website under the heading "Investor Relations." HEI and Hawaiian Electric Company intend to continue to use HEI's website, www.hei.com, 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. Also, at the Investor Relations section of HEI's website, investors may sign up to receive e-mail alerts (based on each investor's selected preferences). 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 on-line replay of the webcast will be available on HEI's website beginning about two hours after the event. Audio replays of the teleconference will also be available approximately two hours after the event through August 25, 2014, by dialing (888)286-8010, passcode:58411343.  HEI supplies power to approximately 450,000 customers or 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, 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 14 to 15 of this release.  FORWARD-LOOKING STATEMENTS  This release may contain "forward-looking statements," which include statements that are predictive in nature, depend upon or refer to future events or conditions, and usually include words such as "expects," "anticipates," "intends," "plans," "believes," "predicts," "estimates" or similar expressions. In addition, any statements concerning future financial performance, ongoing business strategies or prospects or possible future actions are also forward-looking statements. Forward-looking statements are based on current expectations and projections about future events and are subject to risks, uncertainties and the accuracy of assumptions concerning HEI and its subsidiaries, the performance of the industries in which they do business and economic and market factors, among other things. These forward-looking statements are not guarantees of future performance.  Forward-looking statements in this release should be read in conjunction with the "Forward-Looking Statements" and "Risk Factors" discussions (which are incorporated by reference herein) set forth in HEI's Annual Report on Form 10-K for the year ended December31,2013, HEI's Quarterly Report on Form 10-Q for the quarter ended March 31, 2014 and HEI's future periodic reports that discuss important factors that could cause HEI's results to differ materially from those anticipated in such statements. These forward-looking statements speak only as of the date of the report, presentation or filing in which they are made. Except to the extent required by the federal securities laws, HEI, Hawaiian Electric Company, American and their subsidiaries undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.  Hawaiian Electric Industries, Inc. (HEI) and Subsidiaries  CONSOLIDATED STATEMENTS OF INCOME  (Unaudited)                                          Three months ended    Six months ended                                          June 30               June 30 (inthousands,exceptpershareamounts) 2014       2013       2014         2013 Revenues Electric utility                         $ 738,429  $ 728,525  $ 1,458,491  $ 1,445,966 Bank                                     60,616     66,027     124,235      130,783 Other                                    (388)      15         (320)        50 Total revenues                           798,657    794,567    1,582,406    1,576,799 Expenses Electric utility                         668,361    669,550    1,317,757    1,335,870 Bank                                     43,568     41,322     85,564       84,327 Other                                    4,453      3,488      8,504        7,570 Total expenses                           716,382    714,360    1,411,825    1,427,767 Operating income (loss) Electric utility                         70,068     58,975     140,734      110,096 Bank                                     17,048     24,705     38,671       46,456 Other                                    (4,841)    (3,473)    (8,824)      (7,520) Total operating income                   82,275     80,207     170,581      149,032 Interest expense, net—other than on deposit liabilities and other bank       (20,022)   (18,442)   (39,478)     (37,173) borrowings Allowance for borrowed funds used during 523        398        1,137        1,128 construction Allowance for equity funds used during   1,387      1,560      2,996        2,775 construction Income before income taxes               64,163     63,723     135,236      115,762 Income taxes                             22,269     22,662     46,942       40,549 Net income                               41,894     41,061     88,294       75,213 Preferred stock dividends of             473        473        946          946 subsidiaries Net income for common stock              $ 41,421   $ 40,588   $ 87,348     $ 74,267 Basic earnings per common share          $ 0.41     $ 0.41     $ 0.86       $ 0.75 Diluted earnings per common share        $ 0.41     $ 0.41     $ 0.86       $ 0.75 Dividends per common share               $ 0.31     $ 0.31     $ 0.62       $ 0.62 Weighted-average number of common shares 101,495    98,660     101,439      98,399 outstanding Adjusted weighted-average shares         101,825    99,249     102,045      98,961 Net income (loss) for common stock by segment Electric utility                         $ 34,230   $ 28,693   $ 69,650     $ 53,122 Bank                                     11,676     15,919     26,215       30,074 Other                                    (4,485)    (4,024)    (8,517)      (8,929) Net income for common stock              $ 41,421   $ 40,588   $ 87,348     $ 74,267 Comprehensive income attributable to     $ 44,321   $ 32,283   $ 91,415     $ 65,901 Hawaiian Electric Industries, Inc. Return on average common equity (twelve                        10.3%        8.5% months ended^1  This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI's Annual Report on SEC Form 10-K for the year ended December 31, 2013 and HEI's Quarterly Reports on SEC Form 10-Q for the quarters ended March 31, 2014 and June 30, 2014 (when filed), as updated by SEC Forms 8-K. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year.  ^1 On a core basis, 2014 and 2013 return on average common equity (twelve months ended June 30) were 10.3% and 10.0%, respectively. See reconciliation of GAAP to non-GAAP measures.  Hawaiian Electric Industries, Inc. (HEI) and Subsidiaries CONSOLIDATED BALANCE SHEETS (Unaudited) (dollarsinthousands)                      June 30, 2014  December 31, 2013 Assets Cash and cash equivalents                   $  188,377     $    220,036 Accounts receivable and unbilled revenues,  349,771        346,785 net Available-for-sale investment and           549,321        529,007 mortgage-related securities Investment in stock of Federal Home Loan    80,863         92,546 Bank of Seattle Loans receivable held for investment, net   4,245,240      4,110,113 Loans held for sale, at lower of cost or    956            5,302 fair value Property, plant and equipment, net of accumulated depreciation of $2,224,728 and  3,980,096      3,865,514 $2,192,422 at the respective dates Regulatory assets                           582,645        575,924 Other                                       557,684        512,627 Goodwill                                    82,190         82,190 Total assets                                $  10,617,143  $    10,340,044 Liabilities and shareholders' equity Liabilities Accounts payable                            $  176,379     $    212,331 Interest and dividends payable              25,315         26,716 Deposit liabilities                         4,524,860      4,372,477 Short-term borrowings—other than bank       185,175        105,482 Other bank borrowings                       242,455        244,514 Long-term debt, net—other than bank         1,517,945      1,492,945 Deferred income taxes                       579,222        529,260 Regulatory liabilities                      354,980        349,299 Contributions in aid of construction        442,379        432,894 Defined benefit pension and other           278,427        288,539 postretirement benefit plans liability Other                                       494,834        524,224 Total liabilities                           8,821,971      8,578,681 Preferred stock of subsidiaries - not       34,293         34,293 subject to mandatory redemption 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: 1,493,436      1,488,126 101,560,176 shares and 101,259,800 shares at the respective dates Retained earnings                           280,126        255,694 Accumulated other comprehensive loss, net   (12,683)       (16,750) of tax benefits Total shareholders' equity                  1,760,879      1,727,070 Total liabilities and shareholders' equity  $  10,617,143  $    10,340,044  This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI's Annual Report on SEC Form 10-K for the year ended December 31, 2013 and HEI's Quarterly Reports on SEC Form 10-Q for the quarters ended March 31, 2014 and June 30, 2014 (when filed), as updated by SEC Forms 8-K.  Hawaiian Electric Industries, Inc. (HEI) and Subsidiaries CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Six months ended June 30                               2014       2013 (inthousands) Cash flows from operating activities Net income                                             $ 88,294   $ 75,213 Adjustments to reconcile net income to net cash provided by operating activities Depreciation of property, plant and equipment          86,397     79,843 Other amortization                                     4,014      2,868 Provision for loan losses                              2,016      899 Loans receivable originated and purchased, held for    (69,656)   (128,276) sale Proceeds from sale of loans receivable, held for sale  75,040     148,243 Increase in deferred income taxes                      28,252     40,403 Excess tax benefits from share-based payment           (267)      (445) arrangements Allowance for equity funds used during construction    (2,996)    (2,775) Change in cash overdraft                               (1,038)    — Changes in assets and liabilities Decrease (increase) in accounts receivable and         (2,986)    3,564 unbilled revenues, net Decrease (increase) in fuel oil stock                  (27,206)   43,974 Increase in regulatory assets                          (17,731)   (37,586) Decrease in accounts, interest and dividends payable   (64,843)   (43,384) Change in prepaid and accrued income taxes and utility (32,510)   (33,822) revenue taxes Decrease in defined benefit pension and other          (1,714)    (330) postretirement benefit plans liability Change in other assets and liabilities                 (16,871)   (17,597) Net cash provided by operating activities              46,195     130,792 Cash flows from investing activities Available-for-sale investment and mortgage-related     (125,531)  (39,721) securities purchased Principal repayments on available-for-sale investment  33,202     62,819 and mortgage-related securities Proceeds from sale of available-for-sale investment    79,564     71,367 securities Redemption of stock from Federal Home Loan Bank of     11,683     1,742 Seattle Net increase in loans held for investment              (137,122)  (201,184) Proceeds from sale of real estate acquired in          2,162      5,712 settlement of loans Capital expenditures                                   (149,253)  (158,830) Contributions in aid of construction                   13,209     17,188 Other                                                  (16)       622 Net cash used in investing activities                  (272,102)  (240,285) Cash flows from financing activities Net increase in deposit liabilities                    152,383    46,326 Net increase in short-term borrowings with original    79,693     42,093 maturities of three months or less Net decrease in retail repurchase agreements           (2,053)    (8,054) Proceeds from other bank borrowings                    —          25,000 Repayments of other bank borrowings                    —          (25,000) Proceeds from issuance of long-term debt               125,000    50,000 Repayment of long-term debt                            (100,000)  (50,000) Excess tax benefits from share-based payment           267        445 arrangements Net proceeds from issuance of common stock             3,048      11,994 Common stock dividends                                 (62,892)   (48,921) Preferred stock dividends of subsidiaries              (946)      (946) Other                                                  (252)      606 Net cash provided by financing activities              194,248    43,543 Net decrease in cash and cash equivalents              (31,659)   (65,950) Cash and cash equivalents, beginning of period         220,036    219,662 Cash and cash equivalents, end of period               $ 188,377  $ 153,712  This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI's Annual Report on SEC Form 10-K for the year ended December 31, 2013 and HEI's Quarterly Reports on SEC Form 10-Q for the quarters ended March 31, 2014 and June 30, 2014 (when filed), as updated by SEC Forms 8-K. Cash flows for interim periods are not necessarily indicative of cash flows to be expected for future interim periods or the full year.  Hawaiian Electric Company, Inc. (Hawaiian Electric) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME (Unaudited)                            Three months ended    Six months ended                            June 30               June 30 (dollars inthousands,     2014       2013       2014         2013 except per barrel amounts) Revenues                   $ 738,429  $ 728,525  $ 1,458,491  $ 1,445,966 Expenses Fuel oil                   270,257    289,278    556,557      594,378 Purchased power            188,323    178,444    353,239      331,808 Other operation and        98,564     94,397     187,170      196,210 maintenance Depreciation               41,593     38,590     83,196       76,870 Taxes, other than income   69,624     68,841     137,595      136,604 taxes Total expenses             668,361    669,550    1,317,757    1,335,870 Operating income           70,068     58,975     140,734      110,096 Allowance for equity funds 1,387      1,560      2,996        2,775 used during construction Interest expense and other (16,852)   (14,408)   (32,575)     (28,927) charges, net Allowance for borrowed funds used during          523        398        1,137        1,128 construction Income before income taxes 55,126     46,525     112,292      85,072 Income taxes               20,397     17,333     41,644       30,952 Net income                 34,729     29,192     70,648       54,120 Preferred stock dividends  229        229        458          458 of subsidiaries Net income attributable to 34,500     28,963     70,190       53,662 Hawaiian Electric Preferred stock dividends  270        270        540          540 of Hawaiian Electric Net income for common      34,230     28,693     $ 69,650     $ 53,122 stock Comprehensive income attributable to Hawaiian   $ 34,243   $ 28,710   $ 69,672     $ 53,157 Electric OTHER ELECTRIC UTILITY INFORMATION Kilowatthour sales (millions) Hawaiian Electric          1,652      1,702      3,247        3,293 Hawaii Electric Light      261        265        520          528 Maui Electric              276        280        548          549                            2,189      2,247      4,315        4,370 Wet-bulb temperature (Oahu average; degrees           69.1       69.3       68.1         67.6 Fahrenheit) Cooling degree days (Oahu) 1,244      1,114      2,072        1,903 Average fuel oil cost per  $ 132.07   $ 129.94   $ 131.60     $ 131.49 barrel Twelve months ended June                         2014         2013 30 Return on average common equity (%) (simple average)^1 Hawaiian Electric                                9.56         6.80 Hawaii Electric Light                            7.58         5.18 Maui Electric                                    8.16         7.39 Hawaiian Electric                                8.99         6.58 Consolidated  This information should be read in conjunction with the consolidated financial statements and the notes thereto incorporated by reference in Hawaiian Electric's Annual Report on SEC Form 10-K for the year ended December 31, 2013 and the consolidated financial statements and the notes thereto in Hawaiian Electric's Quarterly Reports on SEC Form 10-Q for the quarters ended March 31, 2014 and June 30, 2014 (when filed), as updated by SEC Forms 8-K. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year.  ^1On a core basis, the 2014 and 2013 return on average common equity (twelve months ended June 30) were 9.6% and 8.7%, respectively for Hawaiian Electric; 7.6% and 6.4%, respectively for Hawaii Electric Light; 8.2% and 8.8%, respectively for Maui Electric and 9.0% and 8.3% respectively, for Hawaiian Electric Consolidated. See reconciliation of GAAP to non-GAAP measures.  Hawaiian Electric Company, Inc. (Hawaiian Electric) and Subsidiaries CONSOLIDATED BALANCE SHEETS (Unaudited) (dollars in thousands, except par value)   June30, 2014  December31, 2013 Assets Property, plant and equipment Utility property, plant and equipment Land                                       $  52,010      $    51,883 Plant and equipment                        5,830,723      5,701,875 Less accumulated depreciation              (2,150,913)    (2,111,229) Construction in progress                   168,280        143,233  Utility property, plant and equipment,   3,900,100      3,785,762 net Nonutility property, plant and equipment, less accumulated depreciation of $1,226    6,564          6,567 and $1,223 at respective dates Total property, plant and equipment, net   3,906,664      3,792,329 Current assets Cash and cash equivalents                  12,720         62,825 Customer accounts receivable, net          175,634        175,448 Accrued unbilled revenues, net             141,869        144,124 Other accounts receivable, net             18,915         14,062 Fuel oil stock, at average cost            161,293        134,087 Materials and supplies, at average cost    60,879         59,044 Prepayments and other                      61,891         52,857 Regulatory assets                          78,945         69,738 Total current assets                       712,146        712,185 Other long-term assets Regulatory assets                          503,700        506,186 Unamortized debt expense                   8,905          9,003 Other                                      68,426         67,426 Total other long-term assets               581,031        582,615 Total assets                               $  5,199,841   $    5,087,129 Capitalization and liabilities Capitalization Common stock ($6 2/3 par value, authorized 50,000,000 shares; outstanding 15,429,105  $  102,880     $    102,880 shares) Premium on capital stock                   541,449        541,452 Retained earnings                          974,028        948,624 Accumulated other comprehensive income, net of income taxes-retirement benefit     630            608 plans Common stock equity                        1,618,987      1,593,564 Cumulative preferred stock — not subject   34,293         34,293 to mandatory redemption Long-term debt, net                        1,206,545      1,206,545 Total capitalization                       2,859,825      2,834,402 Current liabilities Current portion of long-term debt          11,400         11,400 Short-term borrowings from non-affiliates  102,989        — Accounts payable                           153,743        189,559 Interest and preferred dividends payable   21,751         21,652 Taxes accrued                              216,374        249,445 Regulatory liabilities                     789            1,916 Other                                      64,569         63,881 Total current liabilities                  571,615        537,853 Deferred credits and other liabilities Deferred income taxes                      557,056        507,161 Regulatory liabilities                     354,191        347,383 Unamortized tax credits                    77,713         73,539 Defined benefit pension and other          252,785        262,162 postretirement benefit plans liability Other                                      84,277         91,735 Total deferred credits and other           1,326,022      1,281,980 liabilities Contributions in aid of construction       442,379        432,894 Total capitalization and liabilities       $  5,199,841   $    5,087,129  This information should be read in conjunction with the consolidated financial statements and the notes thereto incorporated by reference in Hawaiian Electric's Annual Report on SEC Form 10-K for the year ended December 31, 2013 and the consolidated financial statements and the notes thereto in Hawaiian Electric's Quarterly Reports on SEC Form 10-Q for the quarters ended March 31, 2014 and June 30, 2014 (when filed), as updated by SEC Forms 8-K.  Hawaiian Electric Company, Inc. (Hawaiian Electric) and Subsidiaries CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) Six months ended June 30                               2014       2013 (inthousands) Cash flows from operating activities Net income                                             $  70,648  $  54,120 Adjustments to reconcile net income to net cash provided by operating activities Depreciation of property, plant and equipment          83,196     76,870 Other amortization                                     3,597      2,884 Increase in deferred income taxes                      45,386     38,780 Change in tax credits, net                             4,227      2,997 Allowance for equity funds used during construction    (2,996)    (2,775) Change in cash overdraft                               (1,038)    — Changes in assets and liabilities Decrease (increase) in accounts receivable             (5,039)    32,253 Decrease (increase) in accrued unbilled revenues       2,255      (4,889) Decrease (increase) in fuel oil stock                  (27,206)   43,974 Increase in materials and supplies                     (1,835)    (7,139) Increase in regulatory assets                          (17,731)   (37,586) Decrease in accounts payable                           (63,306)   (41,234) Change in prepaid and accrued income taxes and utility (38,270)   (38,123) revenue taxes Increase (decrease) in defined benefit pension and     (498)      989 other postretirement benefit plans liability Change in other assets and liabilities                 (26,258)   (9,419) Net cash provided by operating activities              25,132     111,702 Cash flows from investing activities Capital expenditures                                   (145,734)  (150,251) Contributions in aid of construction                   13,209     17,188 Other                                                  —          623 Net cash used in investing activities                  (132,525)  (132,440) Cash flows from financing activities Common stock dividends                                 (44,246)   (40,789) Preferred stock dividends of Hawaiian Electric and     (998)      (998) subsidiaries Net increase in short-term borrowings from non-affiliates and affiliate with original maturities  102,989    53,992 of three months or less Other                                                  (457)      (9) Net cash provided by financing activities              57,288     12,196 Net decrease in cash and cash equivalents              (50,105)   (8,542) Cash and cash equivalents, beginning of period         62,825     17,159 Cash and cash equivalents, end of period               $  12,720  $  8,617  This information should be read in conjunction with the consolidated financial statements and the notes thereto incorporated by reference in Hawaiian Electric's Annual Report on SEC Form 10-K for the year ended December 31, 2013 and the consolidated financial statements and the notes thereto in Hawaiian Electric's Quarterly Reports on SEC Form 10-Q for the quarters ended March 31, 2014 and June 30, 2014 (when filed), as updated by SEC Forms 8-K. Cash flows for interim periods are not necessarily indicative of cash flows to be expected for future interim periods or the full year.  American Savings Bank, F.S.B. STATEMENTS OF INCOME DATA (Unaudited)                        Three months ended            Six months ended June                                                       30 (inthousands)         June 30,  March 31,  June 30,  2014      2013                        2014      2014       2013 Interest and dividend income Interest and fees on   $ 43,851  $  43,682  $ 43,624  $ 87,533  $ 86,227 loans Interest and dividends on investment and      2,950     3,035      3,234     5,985     6,698 mortgage-related securities Total interest and     46,801    46,717     46,858    93,518    92,925 dividend income Interest expense Interest on deposit    1,237     1,225      1,296     2,462     2,608 liabilities Interest on other      1,420     1,405      1,178     2,825     2,342 borrowings Total interest expense 2,657     2,630      2,474     5,287     4,950 Net interest income    44,144    44,087     44,384    88,231    87,975 Provision (credit) for 1,021     995        (959)     2,016     899 loan losses Net interest income after provision        43,123    43,092     45,343    86,215    87,076 (credit) for loan losses Noninterest income Fees from other        5,217     5,128      7,996     10,345    15,639 financial services Fee income on deposit  4,645     4,421      4,433     9,066     8,747 liabilities Fee income on other    2,064     2,290      1,780     4,354     3,574 financial products Mortgage banking       246       628        2,003     874       5,349 income Gain on sale of        —         2,847      1,226     2,847     1,226 securities Other income, net      1,643     1,588      1,731     3,231     3,323 Total noninterest      13,815    16,902     19,169    30,717    37,858 income Noninterest expense Compensation and       19,872    20,286     20,063    40,158    40,151 employee benefits Occupancy              4,489     3,953      4,219     8,442     8,342 Data processing        2,971     3,060      2,827     6,031     5,814 Services               2,855     2,273      2,328     5,128     4,431 Equipment              1,609     1,645      1,870     3,254     3,644 Other expense          8,094     7,153      8,500     15,247    16,095 Total noninterest      39,890    38,370     39,807    78,260    78,477 expense Income before income   17,048    21,624     24,705    38,672    46,457 taxes Income taxes           5,372     7,085      8,786     12,457    16,383 Net income             $ 11,676  $  14,539  $ 15,919  $ 26,215  $ 30,074 Comprehensive income   $ 14,434  $  15,563  $ 7,340   $ 29,997  $ 22,824 OTHER BANK INFORMATION (annualized %, except as of period end) Return on average      0.87      1.10       1.25      0.98      1.19 assets Return on average      8.78      11.03      12.56     9.90      11.93 equity Return on average      10.39     13.06      15.00     11.72     14.25 tangible common equity Net interest margin    3.55      3.64       3.79      3.59      3.79 Net charge-offs (recoveries) to        (0.04)    0.02       0.08      (0.01)    0.10 average loans outstanding As of period end Nonperforming assets to loans outstanding   1.05      1.12       1.56 and real estate owned * Allowance for loan losses to loans        0.99      0.98       1.04 outstanding Tier-1 leverage ratio  9.0       9.0        9.3 * Total risk-based       12.6      12.7       12.5 capital ratio * Tangible common equity 8.46      8.44       8.42 to total assets Dividend paid to HEI (via ASHI) ($ in       10        9          10 millions)  * Regulatory basis  This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI's Annual Report on SEC Form 10-K for the year ended December 31, 2013 and HEI's Quarterly Reports on SEC Form 10-Q for the quarters ended March 31, 2014 and June 30, 2014 (when filed), as updated by SEC Forms 8-K. 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) (inthousands)                  June 30, 2014         December 31, 2013 Assets Cash and cash equivalents                $ 174,950               $ 156,603 Available-for-sale investment            549,321                 529,007 and mortgage-related securities Investment in stock of Federal           80,863                  92,546 Home Loan Bank of Seattle Loans receivable held for                4,287,612               4,150,229 investment Allowance for loan losses                (42,372)                (40,116) Loans receivable held for                4,245,240               4,110,113 investment, net Loans held for sale, at lower            956                     5,302 of cost or fair value Other                                    284,607                 268,063 Goodwill                                 82,190                  82,190 Total assets                             $ 5,418,127             $ 5,243,824 Liabilities and shareholder's equity Deposit                                  $ 1,301,758             $ 1,214,418 liabilities—noninterest-bearing Deposit                                  3,223,102               3,158,059 liabilities—interest-bearing Other borrowings                         242,455                 244,514 Other                                    116,953                 105,679 Total liabilities                        4,884,268               4,722,670 Common stock                             337,262                 336,054 Retained earnings                        205,012                 197,297 Accumulated other comprehensive loss, net of tax benefits Net unrealized losses on        $ (315)               $ (3,663) securities Retirement benefit plans        (8,100)  (8,415)      (8,534)    (12,197) Total shareholder's equity               533,859                 521,154 Total liabilities and                    $ 5,418,127             $ 5,243,824 shareholder's equity  This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI's Annual Report on SEC Form 10-K for the year ended December 31, 2013 and HEI's Quarterly Reports on SEC Form 10-Q for the quarters ended March 31, 2014 and June 30, 2014 (when filed), as updated by SEC Forms 8-K.  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 the utility and HEI. Management believes these non-GAAP measures provide useful information and are a better indicator of the companies' core operating activities. 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^1 earnings to non-GAAP core earnings for both the utility and HEI consolidated and the corresponding adjusted return on average common equity (ROACE).  The reconciling adjustments from GAAP earnings to core earnings are limited to the settlement charge for the partial write-off of utility assets in the fourth quarter of 2012. For more information on the settlement charge recorded in 2012, see the Form 8-K filed on March 20, 2013. 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 O&M adjusted for "O&M-related net income neutral items" which are O&M expenses covered by specific surcharges or by third parties. This item is grossed-up in revenue and expense and does not impact net income.  RECONCILIATION OF GAAP^1 TO NON-GAAP MEASURES Hawaiian Electric Industries, Inc. and Subsidiaries (HEI) Unaudited ($ in millions) Twelve months ended June 30,                                  2014     2013 HEI CONSOLIDATED NET INCOME GAAP (as reported)                                            $ 174.6  $ 135.8 Excluding special items (after-tax): Settlement agreement for the partial writedown of certain     —        24.4 utility assets Non-GAAP (core)                                               $ 174.6  $ 160.2 HEI CONSOLIDATED RETURN ON AVERAGE COMMON EQUITY (ROACE) (simple average) Based on GAAP                                                 10.3%    8.5% Based on non-GAAP (core)^2                                    10.3%    10.0% Note: Columns may not foot due to rounding ^1 Accounting principles generally accepted in the United States of America ^2 Calculated as core net income divided by average GAAP common equity  RECONCILIATION OF GAAP^1 TO NON-GAAP MEASURES Hawaiian Electric Company, Inc. and Subsidiaries Unaudited ($ in millions) Twelve months ended June 30,                                2014     2013 HAWAIIAN ELECTRIC CONSOLIDATED NET INCOME GAAP (as reported)                                          $ 139.5  $ 95.7 Excluding special items (after-tax): Settlement agreement for the partial writedown of certain   —        24.4 utility assets Non-GAAP (core)                                             $ 139.5  $ 120.2 HAWAIIAN ELECTRIC CONSOLIDATED RETURN ON AVERAGE COMMON EQUITY (ROACE) (simple average): Based on GAAP                                               9.0%     6.6% Based on non-GAAP (core)^2                                  9.0%     8.3%                        Hawaiian Electric  Hawaii Electric Light  Maui Electric Twelve months ended    June 30,                         2013    2014        2013       2014    2013                       2014 NET INCOME                        GAAP (as reported)        98.9   $ 64.0  $   20.8    $  14.4    $ 19.7  $ 17.3                       $ Excluding special items (after-tax): Settlement agreement   for the partial                  17.7    —           3.4        —       3.4 writedown of certain  — utility assets                        Non-GAAP (core)           98.9   $ 81.7  $   20.8    $  17.8    $ 19.7  $ 20.7                       $ RETURN ON AVERAGE COMMON EQUITY (ROACE) (simple average):                        Based on GAAP                    6.8%    7.6%        5.2%       8.2%    7.4%                       9.6% Based on non-GAAP      (core)^2                         8.7%    7.6%        6.4%       8.2%    8.8%                       9.6% Three months ended                                              2014    2013 June 30, HAWAIIAN ELECTRIC CONSOLIDATED OTHER OPERATION AND MAINTENANCE (O&M) EXPENSE GAAP (as reported)                                              $ 98.6  $ 94.4 Excluding O&M-related net income neutral                                              (2.9)   (2.0) items^3 Adjusted O&M expense                                            $ 95.6  $ 92.4 (Non-GAAP measure) Note: Columns may not foot due to rounding ^1 Accounting principles generally accepted in the United States of America ^2 Calculated as core net income divided by average GAAP common equity ^3 Expenses covered by surcharges or by third parties recorded in revenues  Contact: Clifford H. Chen          Manager, Investor Relations & Telephone: (808) 543-7384          Strategic Planning            E-mail: cchen@hei.com  Logo- http://photos.prnewswire.com/prnh/20110411/LA80136LOGO  SOURCE Hawaiian Electric Industries, Inc.  Website: http://www.hei.com  
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