HEI Reports Second Quarter 2019 Earnings

2Q 2019 Diluted Earnings Per Share (EPS) of $0.39

Published

HONOLULU, Aug. 2, 2019 /PRNewswire/ -- Hawaiian Electric Industries, Inc. (NYSE: HE) (HEI) today reported consolidated net income for common stock for the second quarter of 2019 of $42.5 million and diluted earnings per share of $0.39 compared to $46.1 million and EPS of $0.42 for the second quarter of 2018.

"HEI's earnings for the second quarter of 2019 are in line with our expectations for the year, and we are making great strides on our strategies across our enterprise," said Constance H. Lau, president and CEO of HEI.

"Together with our stakeholders, our utilities are working hard to reach our state's ambitious clean energy and carbon neutrality goals while delivering affordable, reliable energy for customers and ensuring system resilience. We recently commenced one of the largest renewables procurement processes ever undertaken by a U.S. utility—seeking up to 900 megawatts of new renewable generation, along with storage and grid services—even faster than planned."

"Our bank results were below recent quarters' performance due to volatility in American's investment portfolio driven by the lower interest rate environment as well as higher credit costs, including for one commercial exposure. The bank continued to deliver strong net interest margin, good loan and deposit growth and improving year-over-year efficiency. We are already seeing many of the benefits we anticipated from the consolidation of the bank's non-branch teammates into the new ASB Campus and we are confident in the future improvements American will deliver for our stakeholders," said Lau.

HAWAIIAN ELECTRIC COMPANY EARNINGS

Hawaiian Electric Company's1 net income for the second quarter of 2019 was $32.6 million compared to $31.2 million in the second quarter of 2018, primarily driven by the following after-tax items:

  • $6.5 million revenue increase resulting from rate increases and higher rate adjustment mechanism (RAM) revenues; the revenue increase included $3.6 million from Hawaiian Electric (Oahu), $2.4 million from Maui Electric (Maui County) and $0.5 million from Hawaii Electric Light (Hawaii Island); and
  • $3.3 million revenue increase from recovery of the Schofield generation project under the major project interim recovery (MPIR) mechanism. These items were partially offset by the following after-tax items:
  • $4.5 million higher operations and maintenance expenses2 compared to the second quarter of 2018, primarily due to higher overhaul expenses and generating station preventative maintenance and repairs, partially offset by the absence of Hawaii Island lava eruption response costs experienced in 2018;
  • $2.6 million higher depreciation expense due to increasing investments for the integration of more renewable energy, improved customer reliability and greater system efficiency; and
  • $0.9 million lower net income resulting from the inclusion of outages for preventative underground circuit maintenance in determining 2018 performance under the reliability performance incentive mechanism.

Note:  Amounts indicated as after-tax in this earnings release are based upon adjusting items using the current year composite statutory tax rates of 25.75% for the utilities and 26.79% for the bank.

1  Hawaiian Electric Company, unless otherwise defined, refers to the three utilities, Hawaiian Electric Company, Inc. on Oahu, Hawaii Electric Light Company, Inc. on Hawaii Island, and Maui Electric Company, Limited, serving Maui County.

2  Excludes net income neutral expenses covered by surcharges or by third parties.  See the "Explanation of HEI's Use of Certain Unaudited Non-GAAP Measures" and the related reconciliation accompanying this release.

AMERICAN SAVINGS BANK EARNINGS

American Savings Bank's (American) second quarter of 2019 net income was $17.0 million compared to $20.8 million in the first, or linked, quarter and $20.6 million in the prior year quarter.

The decrease in net income compared to the linked quarter was primarily due to lower net interest income resulting from an increase in amortization of premiums in the investment securities portfolio, as well as a higher provision for loan losses due to increased loss reserves for one commercial credit, increased reserves for loan portfolio growth, and additional loss reserves for the personal unsecured loan portfolio.

Compared to the second quarter of 2018, the decrease in net income was primarily driven by a higher provision for loan losses due to an increase in loan loss reserves for the personal unsecured loan portfolio, and a lower provision in the prior year due to a release of reserves for improved credit quality in the commercial, commercial real estate and home equity line of credit loan portfolios.

Total loans were $5.0 billion as of June 30, 2019, up $164.5 million or 6.8% annualized from December 31, 2018, driven mainly by increases in commercial loans, home equity lines of credit, and residential loans.

Total deposits were $6.3 billion at June 30, 2019, an increase of $98.5 million or 3.2% annualized from December 31, 2018. Low-cost core deposits were $5.4 billion as of June 30, 2019.

American's return on average equity was 10.5% in the second quarter of 2019 compared to 13.1% in the first quarter of 2019 and 13.6% in the prior year quarter.3  Return on average assets was 0.96% in the second quarter of 2019 compared to 1.18% in the first quarter of 2019 and 1.20% in the second quarter of 2018.

Please refer to American's news release issued on July 30, 2019 for additional information on American.

3  Bank return on average equity calculated using weighted average daily common equity.

HOLDING AND OTHER COMPANIES

The holding and other companies' net loss was $7.1 million in the second quarter of 2019 compared to $5.7 million in the prior year quarter.  The higher net loss was primarily due to higher interest expense, higher HEI corporate expenses, and lower Pacific Current net income due primarily to the hiring of a management team at Pacific Current.

DIRECTOR APPPOINTED TO FILL VACANCY OF RETIRING HEI BOARD MEMBER

On July 31, 2019, the HEI Board elected Micah A. Kane to serve as a director of HEI and a member of its Nominating and Corporate Governance (NCG) Committee, both effective August 1, 2019. Mr. Kane was elected to fill the vacancies on the Board and on the NCG Committee created by the retirement of Dr. James K. Scott, who retired from the Board effective July 31, 2019.

Mr. Kane's extensive leadership experience and in-depth understanding of the communities HEI serves will add to the Board's oversight of HEI's Hawaii-focused strategy and operations.  Among other leadership roles, Mr. Kane's experience includes serving as President and CEO of Hawaii Community Foundation; as a trustee of Kamehameha Schools, a private school system established under the will of Princess Bernice Pauahi Bishop to educate Native Hawaiians; and as a director on the board of HEI's electric utility subsidiary, Hawaiian Electric Company.

WEBCAST AND CONFERENCE CALL TO DISCUSS EARNINGS AND EPS GUIDANCE

HEI will conduct a webcast and conference call to review its second quarter 2019 earnings and 2019 EPS guidance on Friday, August 2, 2019, at 10:15 a.m. Hawaii time (4:15 p.m. Eastern time).

Interested parties within the United States may listen to the conference by calling (844) 834-0652 and international parties may listen to the conference by calling (412) 317-5198 or by accessing the webcast on HEI's website at www.hei.com under the "Investor Relations" section, sub-heading "News and Events."  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 the Investor Relations section of HEI's website at www.hei.com 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. 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 online replay of the webcast will be available at www.hei.com beginning about two hours after the event. Replays of the conference call will also be available approximately two hours after the event through August 16, 2019, by dialing (877) 344-7529 or (412) 317-0088 and entering passcode: 10131926.

HEI supplies power to approximately 95% of Hawaii's population through its electric utilities, Hawaiian Electric Company, Inc., Hawaii Electric Light Company, Inc. and Maui Electric Company, Limited; 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; and helps advance Hawaii's clean energy and sustainability goals through investments by its non-regulated subsidiary, Pacific Current, LLC.

NON-GAAP MEASURES

See "Explanation of HEI's Use of Certain Unaudited Non-GAAP Measures" and related reconciliations on page 9 of this release.

Hawaiian Electric Industries, Inc. (HEI) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited)
Three months ended June 30 Six months ended June 30
(in thousands, except per share amounts) 2019 2018 2019 2018
Revenues
Electric utility $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553
Bank 81,687 77,104 164,739 152,523
Other 14 47 82 75
Total revenues 715,485 685,277 1,377,100 1,331,151
Expenses
Electric utility 578,090 552,982 1,100,025 1,072,040
Bank 60,435 50,187 117,365 100,719
Other 4,326 3,309 9,139 7,704
Total expenses 642,851 606,478 1,226,529 1,180,463
Operating income (loss)
Electric utility 55,694 55,144 112,254 106,513
Bank 21,252 26,917 47,374 51,804
Other (4,312) (3,262) (9,057) (7,629)
Total operating income 72,634 78,799 150,571 150,688
Retirement defined benefits expense—other than service costs (761) (1,564) (1,524) (3,397)
Interest expense, net—other than on deposit liabilities and other bank borrowings (23,533) (22,001) (46,656) (43,519)
Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809
Allowance for equity funds used during construction 3,175 2,983 6,085 6,277
Income before income taxes 52,694 59,582 110,733 112,858
Income taxes 9,709 13,055 21,587 25,611
Net income 42,985 46,527 89,146 87,247
Preferred stock dividends of subsidiaries 473 473 946 946
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301
Basic earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79
Diluted earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79
Dividends declared per common share $ 0.32 $ 0.31 $ 0.64 $ 0.62
Weighted-average number of common shares outstanding 108,938 108,842 108,925 108,830
Weighted-average shares assuming dilution 109,255 108,963 109,324 109,053
Net income (loss) for common stock by segment
Electric utility $ 32,574 $ 31,169 $ 64,700 $ 58,644
Bank 17,016 20,561 37,855 39,521
Other (7,078) (5,676) (14,355) (11,864)
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301
Comprehensive income attributable to Hawaiian Electric Industries, Inc. $ 56,211 $ 42,229 $ 111,140 $ 69,703
Return on average common equity (twelve months ended)1 9.4 % 8.6 %

Hawaiian Electric Industries, Inc. (HEI) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited)
Three months ended June 30 Six months ended June 30 This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC.Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year.
(in thousands, except per share amounts) 2019 2018 2019 2018
Revenues 1  On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 9.4% and 9.2%, respectively.  See reconciliation of GAAP to non-GAAP measures.
Electric utility $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553
Bank 81,687 77,104 164,739 152,523
Other 14 47 82 75
Total revenues 715,485 685,277 1,377,100 1,331,151
Expenses
Electric utility 578,090 552,982 1,100,025 1,072,040
Bank 60,435 50,187 117,365 100,719
Other 4,326 3,309 9,139 7,704
Total expenses 642,851 606,478 1,226,529 1,180,463
Operating income (loss)
Electric utility 55,694 55,144 112,254 106,513
Bank 21,252 26,917 47,374 51,804
Other (4,312) (3,262) (9,057) (7,629)
Total operating income 72,634 78,799 150,571 150,688
Retirement defined benefits expense—other than service costs (761) (1,564) (1,524) (3,397)
Interest expense, net—other than on deposit liabilities and other bank borrowings (23,533) (22,001) (46,656) (43,519)
Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809
Allowance for equity funds used during construction 3,175 2,983 6,085 6,277
Income before income taxes 52,694 59,582 110,733 112,858
Income taxes 9,709 13,055 21,587 25,611
Net income 42,985 46,527 89,146 87,247
Preferred stock dividends of subsidiaries 473 473 946 946
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301
Basic earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79
Diluted earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79
Dividends declared per common share $ 0.32 $ 0.31 $ 0.64 $ 0.62
Weighted-average number of common shares outstanding 108,938 108,842 108,925 108,830
Weighted-average shares assuming dilution 109,255 108,963 109,324 109,053
Net income (loss) for common stock by segment
Electric utility $ 32,574 $ 31,169 $ 64,700 $ 58,644
Bank 17,016 20,561 37,855 39,521
Other (7,078) (5,676) (14,355) (11,864)
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301
Comprehensive income attributable to Hawaiian Electric Industries, Inc. $ 56,211 $ 42,229 $ 111,140 $ 69,703
Return on average common equity (twelve months ended)1 9.4 % 8.6 %

 

Hawaiian Electric Industries, Inc. (HEI) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited) Hawaiian Electric Company, Inc. (Hawaiian Electric) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited)
Three months ended June 30 Six months ended June 30 This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC.Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year.
(in thousands, except per share amounts) 2019 2018 2019 2018 Three months ended June 30 Six months ended June 30
Revenues 1  On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 9.4% and 9.2%, respectively.  See reconciliation of GAAP to non-GAAP measures. ($ in thousands, except per barrel amounts) 2019 2018 2019 2018
Electric utility $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553 Revenues $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553
Bank 81,687 77,104 164,739 152,523 Expenses
Other 14 47 82 75 Fuel oil 181,620 171,717 342,229 338,685
Total revenues 715,485 685,277 1,377,100 1,331,151 Purchased power 162,854 160,738 297,299 300,648
Expenses Other operation and maintenance 119,260 112,642 237,390 220,252
Electric utility 578,090 552,982 1,100,025 1,072,040 Depreciation 53,913 50,361 107,860 100,827
Bank 60,435 50,187 117,365 100,719 Taxes, other than income taxes 60,443 57,524 115,247 111,628
Other 4,326 3,309 9,139 7,704 Total expenses 578,090 552,982 1,100,025 1,072,040
Total expenses 642,851 606,478 1,226,529 1,180,463 Operating income 55,694 55,144 112,254 106,513
Operating income (loss) Allowance for equity funds used during construction 3,175 2,983 6,085 6,277
Electric utility 55,694 55,144 112,254 106,513 Retirement defined benefits expense—other than service costs (701) (988) (1,404) (2,252)
Bank 21,252 26,917 47,374 51,804 Interest expense and other charges, net (18,530) (18,160) (36,516) (35,854)
Other (4,312) (3,262) (9,057) (7,629) Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809
Total operating income 72,634 78,799 150,571 150,688 Income before income taxes 40,817 40,344 82,676 77,493
Retirement defined benefits expense—other than service costs (761) (1,564) (1,524) (3,397) Income taxes 7,744 8,676 16,978 17,851
Interest expense, net—other than on deposit liabilities and other bank borrowings (23,533) (22,001) (46,656) (43,519) Net income 33,073 31,668 65,698 59,642
Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809 Preferred stock dividends of subsidiaries 229 229 458 458
Allowance for equity funds used during construction 3,175 2,983 6,085 6,277 Net income attributable to Hawaiian Electric 32,844 31,439 65,240 59,184
Income before income taxes 52,694 59,582 110,733 112,858 Preferred stock dividends of Hawaiian Electric 270 270 540 540
Income taxes 9,709 13,055 21,587 25,611 Net income for common stock $ 32,574 $ 31,169 $ 64,700 $ 58,644
Net income 42,985 46,527 89,146 87,247 Comprehensive income attributable to Hawaiian Electric $ 32,597 $ 31,195 $ 64,747 $ 58,701
Preferred stock dividends of subsidiaries 473 473 946 946 OTHER ELECTRIC UTILITY INFORMATION
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301 Kilowatthour sales (millions)
Basic earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaiian Electric 1,593 1,597 3,016 3,094
Diluted earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaii Electric Light 253 262 498 519
Dividends declared per common share $ 0.32 $ 0.31 $ 0.64 $ 0.62    Maui Electric 273 269 521 527
Weighted-average number of common shares outstanding 108,938 108,842 108,925 108,830 2,119 2,128 4,035 4,140
Weighted-average shares assuming dilution 109,255 108,963 109,324 109,053 Average fuel oil cost per barrel $ 88.38 $ 81.84 $ 84.44 $ 81.26
Net income (loss) for common stock by segment Return on average common equity (twelve months ended)1 7.8 % 7.2 %
Electric utility $ 32,574 $ 31,169 $ 64,700 $ 58,644
Bank 17,016 20,561 37,855 39,521
Other (7,078) (5,676) (14,355) (11,864)
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301
Comprehensive income attributable to Hawaiian Electric Industries, Inc. $ 56,211 $ 42,229 $ 111,140 $ 69,703
Return on average common equity (twelve months ended)1 9.4 % 8.6 %

Hawaiian Electric Industries, Inc. (HEI) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited) Hawaiian Electric Company, Inc. (Hawaiian Electric) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited)
Three months ended June 30 Six months ended June 30 This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC.Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. This information should be read in conjunction with the consolidated financial statements and the notes thereto in Hawaiian Electric filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year.
(in thousands, except per share amounts) 2019 2018 2019 2018 Three months ended June 30 Six months ended June 30
Revenues 1  On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 9.4% and 9.2%, respectively.  See reconciliation of GAAP to non-GAAP measures. ($ in thousands, except per barrel amounts) 2019 2018 2019 2018 1  Simple average. On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 7.8% and 7.7%, respectively.  See reconciliation of GAAP to non-GAAP measures.
Electric utility $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553 Revenues $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553
Bank 81,687 77,104 164,739 152,523 Expenses
Other 14 47 82 75 Fuel oil 181,620 171,717 342,229 338,685
Total revenues 715,485 685,277 1,377,100 1,331,151 Purchased power 162,854 160,738 297,299 300,648
Expenses Other operation and maintenance 119,260 112,642 237,390 220,252
Electric utility 578,090 552,982 1,100,025 1,072,040 Depreciation 53,913 50,361 107,860 100,827
Bank 60,435 50,187 117,365 100,719 Taxes, other than income taxes 60,443 57,524 115,247 111,628
Other 4,326 3,309 9,139 7,704 Total expenses 578,090 552,982 1,100,025 1,072,040
Total expenses 642,851 606,478 1,226,529 1,180,463 Operating income 55,694 55,144 112,254 106,513
Operating income (loss) Allowance for equity funds used during construction 3,175 2,983 6,085 6,277
Electric utility 55,694 55,144 112,254 106,513 Retirement defined benefits expense—other than service costs (701) (988) (1,404) (2,252)
Bank 21,252 26,917 47,374 51,804 Interest expense and other charges, net (18,530) (18,160) (36,516) (35,854)
Other (4,312) (3,262) (9,057) (7,629) Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809
Total operating income 72,634 78,799 150,571 150,688 Income before income taxes 40,817 40,344 82,676 77,493
Retirement defined benefits expense—other than service costs (761) (1,564) (1,524) (3,397) Income taxes 7,744 8,676 16,978 17,851
Interest expense, net—other than on deposit liabilities and other bank borrowings (23,533) (22,001) (46,656) (43,519) Net income 33,073 31,668 65,698 59,642
Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809 Preferred stock dividends of subsidiaries 229 229 458 458
Allowance for equity funds used during construction 3,175 2,983 6,085 6,277 Net income attributable to Hawaiian Electric 32,844 31,439 65,240 59,184
Income before income taxes 52,694 59,582 110,733 112,858 Preferred stock dividends of Hawaiian Electric 270 270 540 540
Income taxes 9,709 13,055 21,587 25,611 Net income for common stock $ 32,574 $ 31,169 $ 64,700 $ 58,644
Net income 42,985 46,527 89,146 87,247 Comprehensive income attributable to Hawaiian Electric $ 32,597 $ 31,195 $ 64,747 $ 58,701
Preferred stock dividends of subsidiaries 473 473 946 946 OTHER ELECTRIC UTILITY INFORMATION
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301 Kilowatthour sales (millions)
Basic earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaiian Electric 1,593 1,597 3,016 3,094
Diluted earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaii Electric Light 253 262 498 519
Dividends declared per common share $ 0.32 $ 0.31 $ 0.64 $ 0.62    Maui Electric 273 269 521 527
Weighted-average number of common shares outstanding 108,938 108,842 108,925 108,830 2,119 2,128 4,035 4,140
Weighted-average shares assuming dilution 109,255 108,963 109,324 109,053 Average fuel oil cost per barrel $ 88.38 $ 81.84 $ 84.44 $ 81.26
Net income (loss) for common stock by segment Return on average common equity (twelve months ended)1 7.8 % 7.2 %
Electric utility $ 32,574 $ 31,169 $ 64,700 $ 58,644
Bank 17,016 20,561 37,855 39,521
Other (7,078) (5,676) (14,355) (11,864)
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301
Comprehensive income attributable to Hawaiian Electric Industries, Inc. $ 56,211 $ 42,229 $ 111,140 $ 69,703
Return on average common equity (twelve months ended)1 9.4 % 8.6 %

 

Hawaiian Electric Industries, Inc. (HEI) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited) Hawaiian Electric Company, Inc. (Hawaiian Electric) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited) American Savings Bank, F.S.B. STATEMENTS OF INCOME DATA (Unaudited)
Three months ended June 30 Six months ended June 30 This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC.Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. This information should be read in conjunction with the consolidated financial statements and the notes thereto in Hawaiian Electric filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year.
(in thousands, except per share amounts) 2019 2018 2019 2018 Three months ended June 30 Six months ended June 30 Three months ended Six months ended June 30
Revenues 1  On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 9.4% and 9.2%, respectively.  See reconciliation of GAAP to non-GAAP measures. ($ in thousands, except per barrel amounts) 2019 2018 2019 2018 1  Simple average. On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 7.8% and 7.7%, respectively.  See reconciliation of GAAP to non-GAAP measures. ($ in thousands) June 30, 2019 March 31, 2019 June 30, 2018 2019 2018
Electric utility $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553 Revenues $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553 Interest and dividend income
Bank 81,687 77,104 164,739 152,523 Expenses Interest and fees on loans $ 58,620 $ 57,860 $ 54,633 $ 116,480 $ 107,433
Other 14 47 82 75 Fuel oil 181,620 171,717 342,229 338,685 Interest and dividends on investment securities 7,535 10,628 8,628 18,163 17,830
Total revenues 715,485 685,277 1,377,100 1,331,151 Purchased power 162,854 160,738 297,299 300,648 Total interest and dividend income 66,155 68,488 63,261 134,643 125,263
Expenses Other operation and maintenance 119,260 112,642 237,390 220,252 Interest expense
Electric utility 578,090 552,982 1,100,025 1,072,040 Depreciation 53,913 50,361 107,860 100,827 Interest on deposit liabilities 4,287 4,252 3,284 8,539 6,241
Bank 60,435 50,187 117,365 100,719 Taxes, other than income taxes 60,443 57,524 115,247 111,628 Interest on other borrowings 411 528 393 939 889
Other 4,326 3,309 9,139 7,704 Total expenses 578,090 552,982 1,100,025 1,072,040 Total interest expense 4,698 4,780 3,677 9,478 7,130
Total expenses 642,851 606,478 1,226,529 1,180,463 Operating income 55,694 55,144 112,254 106,513 Net interest income 61,457 63,708 59,584 125,165 118,133
Operating income (loss) Allowance for equity funds used during construction 3,175 2,983 6,085 6,277 Provision for loan losses 7,688 6,870 2,763 14,558 6,304
Electric utility 55,694 55,144 112,254 106,513 Retirement defined benefits expense—other than service costs (701) (988) (1,404) (2,252) Net interest income after provision for loan losses 53,769 56,838 56,821 110,607 111,829
Bank 21,252 26,917 47,374 51,804 Interest expense and other charges, net (18,530) (18,160) (36,516) (35,854) Noninterest income
Other (4,312) (3,262) (9,057) (7,629) Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809 Fees from other financial services 4,798 4,562 4,744 9,360 9,398
Total operating income 72,634 78,799 150,571 150,688 Income before income taxes 40,817 40,344 82,676 77,493 Fee income on deposit liabilities 5,004 5,078 5,138 10,082 10,327
Retirement defined benefits expense—other than service costs (761) (1,564) (1,524) (3,397) Income taxes 7,744 8,676 16,978 17,851 Fee income on other financial products 1,830 1,593 1,675 3,423 3,329
Interest expense, net—other than on deposit liabilities and other bank borrowings (23,533) (22,001) (46,656) (43,519) Net income 33,073 31,668 65,698 59,642 Bank-owned life insurance 2,390 2,259 1,133 4,649 2,004
Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809 Preferred stock dividends of subsidiaries 229 229 458 458 Mortgage banking income 976 614 617 1,590 1,230
Allowance for equity funds used during construction 3,175 2,983 6,085 6,277 Net income attributable to Hawaiian Electric 32,844 31,439 65,240 59,184 Other income, net 534 458 536 992 972
Income before income taxes 52,694 59,582 110,733 112,858 Preferred stock dividends of Hawaiian Electric 270 270 540 540 Total noninterest income 15,532 14,564 13,843 30,096 27,260
Income taxes 9,709 13,055 21,587 25,611 Net income for common stock $ 32,574 $ 31,169 $ 64,700 $ 58,644 Noninterest expense
Net income 42,985 46,527 89,146 87,247 Comprehensive income attributable to Hawaiian Electric $ 32,597 $ 31,195 $ 64,747 $ 58,701 Compensation and employee benefits 25,750 25,512 23,655 51,262 48,095
Preferred stock dividends of subsidiaries 473 473 946 946 OTHER ELECTRIC UTILITY INFORMATION Occupancy 5,479 4,670 4,194 10,149 8,474
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301 Kilowatthour sales (millions) Data processing 3,852 3,738 3,540 7,590 7,004
Basic earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaiian Electric 1,593 1,597 3,016 3,094 Services 2,606 2,426 3,028 5,032 6,075
Diluted earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaii Electric Light 253 262 498 519 Equipment 2,189 2,064 1,874 4,253 3,602
Dividends declared per common share $ 0.32 $ 0.31 $ 0.64 $ 0.62    Maui Electric 273 269 521 527 Office supplies, printing and postage 1,663 1,360 1,491 3,023 2,998
Weighted-average number of common shares outstanding 108,938 108,842 108,925 108,830 2,119 2,128 4,035 4,140 Marketing 1,323 990 1,085 2,313 1,730
Weighted-average shares assuming dilution 109,255 108,963 109,324 109,053 Average fuel oil cost per barrel $ 88.38 $ 81.84 $ 84.44 $ 81.26 FDIC insurance 628 626 727 1,254 1,440
Net income (loss) for common stock by segment Return on average common equity (twelve months ended)1 7.8 % 7.2 % Other expense 4,519 3,854 4,556 8,373 8,657
Electric utility $ 32,574 $ 31,169 $ 64,700 $ 58,644 Total noninterest expense 48,009 45,240 44,150 93,249 88,075
Bank 17,016 20,561 37,855 39,521 Income before income taxes 21,292 26,162 26,514 47,454 51,014
Other (7,078) (5,676) (14,355) (11,864) Income taxes 4,276 5,323 5,953 9,599 11,493
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301 Net income $ 17,016 $ 20,839 $ 20,561 $ 37,855 $ 39,521
Comprehensive income attributable to Hawaiian Electric Industries, Inc. $ 56,211 $ 42,229 $ 111,140 $ 69,703 Comprehensive income $ 31,291 $ 27,091 $ 16,579 $ 58,382 $ 23,464
Return on average common equity (twelve months ended)1 9.4 % 8.6 % OTHER BANK INFORMATION (annualized %, except as of period end)
Return on average assets 0.96 1.18 1.20 1.07 1.16
Return on average equity 10.46 13.09 13.56 11.76 13.07
Return on average tangible common equity 11.97 15.03 15.68 13.48 15.13
Net interest margin 3.82 3.99 3.76 3.90 3.76
Efficiency ratio 62.36 57.80 60.13 60.06 60.58
Net charge-offs to average loans outstanding 0.29 0.39 0.32 0.34 0.30
As of period end
Nonaccrual loans to loans receivable held for investment 0.79 0.83 0.57
Allowance for loan losses to loans outstanding 1.17 1.12 1.11
Tangible common equity to tangible assets 8.2 8.1 7.6
Tier-1 leverage ratio 8.7 8.7 8.6
Total capital ratio 14.0 13.9 13.9
Dividend paid to HEI (via ASB Hawaii, Inc.) ($ in millions) $ 15.0 $ 18.0 $ 11.1 $ 33.0 $ 22.0

Hawaiian Electric Industries, Inc. (HEI) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited) Hawaiian Electric Company, Inc. (Hawaiian Electric) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited) American Savings Bank, F.S.B. STATEMENTS OF INCOME DATA (Unaudited)
Three months ended June 30 Six months ended June 30 This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC.Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. This information should be read in conjunction with the consolidated financial statements and the notes thereto in Hawaiian Electric filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year.
(in thousands, except per share amounts) 2019 2018 2019 2018 Three months ended June 30 Six months ended June 30 Three months ended Six months ended June 30
Revenues 1  On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 9.4% and 9.2%, respectively.  See reconciliation of GAAP to non-GAAP measures. ($ in thousands, except per barrel amounts) 2019 2018 2019 2018 1  Simple average. On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 7.8% and 7.7%, respectively.  See reconciliation of GAAP to non-GAAP measures. ($ in thousands) June 30, 2019 March 31, 2019 June 30, 2018 2019 2018
Electric utility $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553 Revenues $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553 Interest and dividend income
Bank 81,687 77,104 164,739 152,523 Expenses Interest and fees on loans $ 58,620 $ 57,860 $ 54,633 $ 116,480 $ 107,433
Other 14 47 82 75 Fuel oil 181,620 171,717 342,229 338,685 Interest and dividends on investment securities 7,535 10,628 8,628 18,163 17,830
Total revenues 715,485 685,277 1,377,100 1,331,151 Purchased power 162,854 160,738 297,299 300,648 Total interest and dividend income 66,155 68,488 63,261 134,643 125,263
Expenses Other operation and maintenance 119,260 112,642 237,390 220,252 Interest expense
Electric utility 578,090 552,982 1,100,025 1,072,040 Depreciation 53,913 50,361 107,860 100,827 Interest on deposit liabilities 4,287 4,252 3,284 8,539 6,241
Bank 60,435 50,187 117,365 100,719 Taxes, other than income taxes 60,443 57,524 115,247 111,628 Interest on other borrowings 411 528 393 939 889
Other 4,326 3,309 9,139 7,704 Total expenses 578,090 552,982 1,100,025 1,072,040 Total interest expense 4,698 4,780 3,677 9,478 7,130
Total expenses 642,851 606,478 1,226,529 1,180,463 Operating income 55,694 55,144 112,254 106,513 Net interest income 61,457 63,708 59,584 125,165 118,133
Operating income (loss) Allowance for equity funds used during construction 3,175 2,983 6,085 6,277 Provision for loan losses 7,688 6,870 2,763 14,558 6,304
Electric utility 55,694 55,144 112,254 106,513 Retirement defined benefits expense—other than service costs (701) (988) (1,404) (2,252) Net interest income after provision for loan losses 53,769 56,838 56,821 110,607 111,829
Bank 21,252 26,917 47,374 51,804 Interest expense and other charges, net (18,530) (18,160) (36,516) (35,854) Noninterest income
Other (4,312) (3,262) (9,057) (7,629) Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809 Fees from other financial services 4,798 4,562 4,744 9,360 9,398
Total operating income 72,634 78,799 150,571 150,688 Income before income taxes 40,817 40,344 82,676 77,493 Fee income on deposit liabilities 5,004 5,078 5,138 10,082 10,327
Retirement defined benefits expense—other than service costs (761) (1,564) (1,524) (3,397) Income taxes 7,744 8,676 16,978 17,851 Fee income on other financial products 1,830 1,593 1,675 3,423 3,329
Interest expense, net—other than on deposit liabilities and other bank borrowings (23,533) (22,001) (46,656) (43,519) Net income 33,073 31,668 65,698 59,642 Bank-owned life insurance 2,390 2,259 1,133 4,649 2,004
Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809 Preferred stock dividends of subsidiaries 229 229 458 458 Mortgage banking income 976 614 617 1,590 1,230
Allowance for equity funds used during construction 3,175 2,983 6,085 6,277 Net income attributable to Hawaiian Electric 32,844 31,439 65,240 59,184 Other income, net 534 458 536 992 972
Income before income taxes 52,694 59,582 110,733 112,858 Preferred stock dividends of Hawaiian Electric 270 270 540 540 Total noninterest income 15,532 14,564 13,843 30,096 27,260
Income taxes 9,709 13,055 21,587 25,611 Net income for common stock $ 32,574 $ 31,169 $ 64,700 $ 58,644 Noninterest expense
Net income 42,985 46,527 89,146 87,247 Comprehensive income attributable to Hawaiian Electric $ 32,597 $ 31,195 $ 64,747 $ 58,701 Compensation and employee benefits 25,750 25,512 23,655 51,262 48,095
Preferred stock dividends of subsidiaries 473 473 946 946 OTHER ELECTRIC UTILITY INFORMATION Occupancy 5,479 4,670 4,194 10,149 8,474
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301 Kilowatthour sales (millions) Data processing 3,852 3,738 3,540 7,590 7,004
Basic earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaiian Electric 1,593 1,597 3,016 3,094 Services 2,606 2,426 3,028 5,032 6,075
Diluted earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaii Electric Light 253 262 498 519 Equipment 2,189 2,064 1,874 4,253 3,602
Dividends declared per common share $ 0.32 $ 0.31 $ 0.64 $ 0.62    Maui Electric 273 269 521 527 Office supplies, printing and postage 1,663 1,360 1,491 3,023 2,998
Weighted-average number of common shares outstanding 108,938 108,842 108,925 108,830 2,119 2,128 4,035 4,140 Marketing 1,323 990 1,085 2,313 1,730
Weighted-average shares assuming dilution 109,255 108,963 109,324 109,053 Average fuel oil cost per barrel $ 88.38 $ 81.84 $ 84.44 $ 81.26 FDIC insurance 628 626 727 1,254 1,440
Net income (loss) for common stock by segment Return on average common equity (twelve months ended)1 7.8 % 7.2 % Other expense 4,519 3,854 4,556 8,373 8,657
Electric utility $ 32,574 $ 31,169 $ 64,700 $ 58,644 Total noninterest expense 48,009 45,240 44,150 93,249 88,075
Bank 17,016 20,561 37,855 39,521 Income before income taxes 21,292 26,162 26,514 47,454 51,014
Other (7,078) (5,676) (14,355) (11,864) Income taxes 4,276 5,323 5,953 9,599 11,493
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301 Net income $ 17,016 $ 20,839 $ 20,561 $ 37,855 $ 39,521
Comprehensive income attributable to Hawaiian Electric Industries, Inc. $ 56,211 $ 42,229 $ 111,140 $ 69,703 Comprehensive income $ 31,291 $ 27,091 $ 16,579 $ 58,382 $ 23,464
Return on average common equity (twelve months ended)1 9.4 % 8.6 % OTHER BANK INFORMATION (annualized %, except as of period end)
Return on average assets 0.96 1.18 1.20 1.07 1.16
Return on average equity 10.46 13.09 13.56 11.76 13.07
Return on average tangible common equity 11.97 15.03 15.68 13.48 15.13
Net interest margin 3.82 3.99 3.76 3.90 3.76
Efficiency ratio 62.36 57.80 60.13 60.06 60.58
Net charge-offs to average loans outstanding 0.29 0.39 0.32 0.34 0.30
As of period end
Nonaccrual loans to loans receivable held for investment 0.79 0.83 0.57
Allowance for loan losses to loans outstanding 1.17 1.12 1.11
Tangible common equity to tangible assets 8.2 8.1 7.6
Tier-1 leverage ratio 8.7 8.7 8.6
Total capital ratio 14.0 13.9 13.9
Dividend paid to HEI (via ASB Hawaii, Inc.) ($ in millions) $ 15.0 $ 18.0 $ 11.1 $ 33.0 $ 22.0

EXPLANATION OF HEI'S USE OF CERTAIN UNAUDITED NON-GAAP MEASURES

HEI and Hawaiian Electric Company management use certain non-GAAP measures, which exclude certain items that are not reflective of ongoing operations or that are not expected to reoccur, to evaluate the performance of HEI and the utility.  Management believes these non-GAAP measures provide useful supplemental information and are a better indicator of the companies' core operating activities. Core earnings and other financial measures as presented below may not be comparable to similarly titled measures used by other companies. The accompanying tables provide a reconciliation of reported GAAP1 earnings to non-GAAP core earnings and the adjusted return on average common equity (ROACE) for HEI and the utility.

The reconciling adjustments from GAAP earnings to core earnings exclude the 2017 impact of the federal tax reform act due to the adjustment of the deferred tax balances and the $1,000 non-executive employee bonuses paid by the bank related to federal tax reform. Management does not consider these items to be representative of the company's fundamental core earnings. Management has shown adjusted non-GAAP (core) net income, adjusted non-GAAP (core) ROACE in order to provide better comparability of ROACE between periods.

The accompanying table also provides the calculation of utility GAAP other operation and maintenance (O&M) expense adjusted for "O&M-related net income neutral items," which are O&M expenses covered by specific surcharges or by third parties. These "O&M-related net income neutral items" are grossed-up in revenue and expense and do not impact net income.

Hawaiian Electric Industries, Inc. (HEI) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited) Hawaiian Electric Company, Inc. (Hawaiian Electric) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited) American Savings Bank, F.S.B. STATEMENTS OF INCOME DATA (Unaudited) RECONCILIATION OF GAAP1 TO NON-GAAP MEASURES
Three months ended June 30 Six months ended June 30 This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC.Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. This information should be read in conjunction with the consolidated financial statements and the notes thereto in Hawaiian Electric filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. Hawaiian Electric Industries, Inc. and Subsidiaries (HEI)
(in thousands, except per share amounts) 2019 2018 2019 2018 Three months ended June 30 Six months ended June 30 Three months ended Six months ended June 30 Unaudited Twelve months ended June 30
Revenues 1  On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 9.4% and 9.2%, respectively.  See reconciliation of GAAP to non-GAAP measures. ($ in thousands, except per barrel amounts) 2019 2018 2019 2018 1  Simple average. On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 7.8% and 7.7%, respectively.  See reconciliation of GAAP to non-GAAP measures. ($ in thousands) June 30, 2019 March 31, 2019 June 30, 2018 2019 2018 ($ in millions) 2019 2018
Electric utility $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553 Revenues $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553 Interest and dividend income HEI CONSOLIDATED NET INCOME
Bank 81,687 77,104 164,739 152,523 Expenses Interest and fees on loans $ 58,620 $ 57,860 $ 54,633 $ 116,480 $ 107,433 GAAP (as reported) $ 203.7 $ 178.7
Other 14 47 82 75 Fuel oil 181,620 171,717 342,229 338,685 Interest and dividends on investment securities 7,535 10,628 8,628 18,163 17,830 Excluding special items (after-tax):
Total revenues 715,485 685,277 1,377,100 1,331,151 Purchased power 162,854 160,738 297,299 300,648 Total interest and dividend income 66,155 68,488 63,261 134,643 125,263 One-time non-executive bank employee bonus related to federal tax reform 0.7
Expenses Other operation and maintenance 119,260 112,642 237,390 220,252 Interest expense Federal tax reform impacts2 13.4
Electric utility 578,090 552,982 1,100,025 1,072,040 Depreciation 53,913 50,361 107,860 100,827 Interest on deposit liabilities 4,287 4,252 3,284 8,539 6,241 Non-GAAP (core) net income $ 203.7 $ 192.9
Bank 60,435 50,187 117,365 100,719 Taxes, other than income taxes 60,443 57,524 115,247 111,628 Interest on other borrowings 411 528 393 939 889 HEI CONSOLIDATED AVERAGE COMMON EQUITY $ 2,155.8 $ 2,089.0
Other 4,326 3,309 9,139 7,704 Total expenses 578,090 552,982 1,100,025 1,072,040 Total interest expense 4,698 4,780 3,677 9,478 7,130 HEI CONSOLIDATED RETURN ON AVERAGE COMMON EQUITY (ROACE) (simple average)
Total expenses 642,851 606,478 1,226,529 1,180,463 Operating income 55,694 55,144 112,254 106,513 Net interest income 61,457 63,708 59,584 125,165 118,133 Based on GAAP 9.4 % 8.6 %
Operating income (loss) Allowance for equity funds used during construction 3,175 2,983 6,085 6,277 Provision for loan losses 7,688 6,870 2,763 14,558 6,304 Based on non-GAAP (core)3 9.4 % 9.2 %
Electric utility 55,694 55,144 112,254 106,513 Retirement defined benefits expense—other than service costs (701) (988) (1,404) (2,252) Net interest income after provision for loan losses 53,769 56,838 56,821 110,607 111,829
Bank 21,252 26,917 47,374 51,804 Interest expense and other charges, net (18,530) (18,160) (36,516) (35,854) Noninterest income
Other (4,312) (3,262) (9,057) (7,629) Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809 Fees from other financial services 4,798 4,562 4,744 9,360 9,398
Total operating income 72,634 78,799 150,571 150,688 Income before income taxes 40,817 40,344 82,676 77,493 Fee income on deposit liabilities 5,004 5,078 5,138 10,082 10,327
Retirement defined benefits expense—other than service costs (761) (1,564) (1,524) (3,397) Income taxes 7,744 8,676 16,978 17,851 Fee income on other financial products 1,830 1,593 1,675 3,423 3,329
Interest expense, net—other than on deposit liabilities and other bank borrowings (23,533) (22,001) (46,656) (43,519) Net income 33,073 31,668 65,698 59,642 Bank-owned life insurance 2,390 2,259 1,133 4,649 2,004
Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809 Preferred stock dividends of subsidiaries 229 229 458 458 Mortgage banking income 976 614 617 1,590 1,230
Allowance for equity funds used during construction 3,175 2,983 6,085 6,277 Net income attributable to Hawaiian Electric 32,844 31,439 65,240 59,184 Other income, net 534 458 536 992 972
Income before income taxes 52,694 59,582 110,733 112,858 Preferred stock dividends of Hawaiian Electric 270 270 540 540 Total noninterest income 15,532 14,564 13,843 30,096 27,260
Income taxes 9,709 13,055 21,587 25,611 Net income for common stock $ 32,574 $ 31,169 $ 64,700 $ 58,644 Noninterest expense
Net income 42,985 46,527 89,146 87,247 Comprehensive income attributable to Hawaiian Electric $ 32,597 $ 31,195 $ 64,747 $ 58,701 Compensation and employee benefits 25,750 25,512 23,655 51,262 48,095
Preferred stock dividends of subsidiaries 473 473 946 946 OTHER ELECTRIC UTILITY INFORMATION Occupancy 5,479 4,670 4,194 10,149 8,474
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301 Kilowatthour sales (millions) Data processing 3,852 3,738 3,540 7,590 7,004
Basic earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaiian Electric 1,593 1,597 3,016 3,094 Services 2,606 2,426 3,028 5,032 6,075
Diluted earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaii Electric Light 253 262 498 519 Equipment 2,189 2,064 1,874 4,253 3,602
Dividends declared per common share $ 0.32 $ 0.31 $ 0.64 $ 0.62    Maui Electric 273 269 521 527 Office supplies, printing and postage 1,663 1,360 1,491 3,023 2,998
Weighted-average number of common shares outstanding 108,938 108,842 108,925 108,830 2,119 2,128 4,035 4,140 Marketing 1,323 990 1,085 2,313 1,730
Weighted-average shares assuming dilution 109,255 108,963 109,324 109,053 Average fuel oil cost per barrel $ 88.38 $ 81.84 $ 84.44 $ 81.26 FDIC insurance 628 626 727 1,254 1,440
Net income (loss) for common stock by segment Return on average common equity (twelve months ended)1 7.8 % 7.2 % Other expense 4,519 3,854 4,556 8,373 8,657
Electric utility $ 32,574 $ 31,169 $ 64,700 $ 58,644 Total noninterest expense 48,009 45,240 44,150 93,249 88,075
Bank 17,016 20,561 37,855 39,521 Income before income taxes 21,292 26,162 26,514 47,454 51,014
Other (7,078) (5,676) (14,355) (11,864) Income taxes 4,276 5,323 5,953 9,599 11,493
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301 Net income $ 17,016 $ 20,839 $ 20,561 $ 37,855 $ 39,521
Comprehensive income attributable to Hawaiian Electric Industries, Inc. $ 56,211 $ 42,229 $ 111,140 $ 69,703 Comprehensive income $ 31,291 $ 27,091 $ 16,579 $ 58,382 $ 23,464
Return on average common equity (twelve months ended)1 9.4 % 8.6 % OTHER BANK INFORMATION (annualized %, except as of period end)
Return on average assets 0.96 1.18 1.20 1.07 1.16
Return on average equity 10.46 13.09 13.56 11.76 13.07
Return on average tangible common equity 11.97 15.03 15.68 13.48 15.13
Net interest margin 3.82 3.99 3.76 3.90 3.76
Efficiency ratio 62.36 57.80 60.13 60.06 60.58
Net charge-offs to average loans outstanding 0.29 0.39 0.32 0.34 0.30
As of period end
Nonaccrual loans to loans receivable held for investment 0.79 0.83 0.57
Allowance for loan losses to loans outstanding 1.17 1.12 1.11
Tangible common equity to tangible assets 8.2 8.1 7.6
Tier-1 leverage ratio 8.7 8.7 8.6
Total capital ratio 14.0 13.9 13.9
Dividend paid to HEI (via ASB Hawaii, Inc.) ($ in millions) $ 15.0 $ 18.0 $ 11.1 $ 33.0 $ 22.0

Hawaiian Electric Industries, Inc. (HEI) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited) Hawaiian Electric Company, Inc. (Hawaiian Electric) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited) American Savings Bank, F.S.B. STATEMENTS OF INCOME DATA (Unaudited) RECONCILIATION OF GAAP1 TO NON-GAAP MEASURES
Three months ended June 30 Six months ended June 30 This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC.Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. This information should be read in conjunction with the consolidated financial statements and the notes thereto in Hawaiian Electric filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. Hawaiian Electric Industries, Inc. and Subsidiaries (HEI) Note:  Columns may not foot due to rounding
(in thousands, except per share amounts) 2019 2018 2019 2018 Three months ended June 30 Six months ended June 30 Three months ended Six months ended June 30 Unaudited Twelve months ended June 30 1  Accounting principles generally accepted in the United States of America
Revenues 1  On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 9.4% and 9.2%, respectively.  See reconciliation of GAAP to non-GAAP measures. ($ in thousands, except per barrel amounts) 2019 2018 2019 2018 1  Simple average. On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 7.8% and 7.7%, respectively.  See reconciliation of GAAP to non-GAAP measures. ($ in thousands) June 30, 2019 March 31, 2019 June 30, 2018 2019 2018 ($ in millions) 2019 2018 2  Reflects the lower rates enacted by federal tax reform, primarily the adjustments to reduce the unregulated net deferred tax asset balances
Electric utility $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553 Revenues $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553 Interest and dividend income HEI CONSOLIDATED NET INCOME 3  Calculated as core net income divided by average GAAP common equity
Bank 81,687 77,104 164,739 152,523 Expenses Interest and fees on loans $ 58,620 $ 57,860 $ 54,633 $ 116,480 $ 107,433 GAAP (as reported) $ 203.7 $ 178.7
Other 14 47 82 75 Fuel oil 181,620 171,717 342,229 338,685 Interest and dividends on investment securities 7,535 10,628 8,628 18,163 17,830 Excluding special items (after-tax):
Total revenues 715,485 685,277 1,377,100 1,331,151 Purchased power 162,854 160,738 297,299 300,648 Total interest and dividend income 66,155 68,488 63,261 134,643 125,263 One-time non-executive bank employee bonus related to federal tax reform 0.7
Expenses Other operation and maintenance 119,260 112,642 237,390 220,252 Interest expense Federal tax reform impacts2 13.4
Electric utility 578,090 552,982 1,100,025 1,072,040 Depreciation 53,913 50,361 107,860 100,827 Interest on deposit liabilities 4,287 4,252 3,284 8,539 6,241 Non-GAAP (core) net income $ 203.7 $ 192.9
Bank 60,435 50,187 117,365 100,719 Taxes, other than income taxes 60,443 57,524 115,247 111,628 Interest on other borrowings 411 528 393 939 889 HEI CONSOLIDATED AVERAGE COMMON EQUITY $ 2,155.8 $ 2,089.0
Other 4,326 3,309 9,139 7,704 Total expenses 578,090 552,982 1,100,025 1,072,040 Total interest expense 4,698 4,780 3,677 9,478 7,130 HEI CONSOLIDATED RETURN ON AVERAGE COMMON EQUITY (ROACE) (simple average)
Total expenses 642,851 606,478 1,226,529 1,180,463 Operating income 55,694 55,144 112,254 106,513 Net interest income 61,457 63,708 59,584 125,165 118,133 Based on GAAP 9.4 % 8.6 %
Operating income (loss) Allowance for equity funds used during construction 3,175 2,983 6,085 6,277 Provision for loan losses 7,688 6,870 2,763 14,558 6,304 Based on non-GAAP (core)3 9.4 % 9.2 %
Electric utility 55,694 55,144 112,254 106,513 Retirement defined benefits expense—other than service costs (701) (988) (1,404) (2,252) Net interest income after provision for loan losses 53,769 56,838 56,821 110,607 111,829
Bank 21,252 26,917 47,374 51,804 Interest expense and other charges, net (18,530) (18,160) (36,516) (35,854) Noninterest income
Other (4,312) (3,262) (9,057) (7,629) Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809 Fees from other financial services 4,798 4,562 4,744 9,360 9,398
Total operating income 72,634 78,799 150,571 150,688 Income before income taxes 40,817 40,344 82,676 77,493 Fee income on deposit liabilities 5,004 5,078 5,138 10,082 10,327
Retirement defined benefits expense—other than service costs (761) (1,564) (1,524) (3,397) Income taxes 7,744 8,676 16,978 17,851 Fee income on other financial products 1,830 1,593 1,675 3,423 3,329
Interest expense, net—other than on deposit liabilities and other bank borrowings (23,533) (22,001) (46,656) (43,519) Net income 33,073 31,668 65,698 59,642 Bank-owned life insurance 2,390 2,259 1,133 4,649 2,004
Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809 Preferred stock dividends of subsidiaries 229 229 458 458 Mortgage banking income 976 614 617 1,590 1,230
Allowance for equity funds used during construction 3,175 2,983 6,085 6,277 Net income attributable to Hawaiian Electric 32,844 31,439 65,240 59,184 Other income, net 534 458 536 992 972
Income before income taxes 52,694 59,582 110,733 112,858 Preferred stock dividends of Hawaiian Electric 270 270 540 540 Total noninterest income 15,532 14,564 13,843 30,096 27,260
Income taxes 9,709 13,055 21,587 25,611 Net income for common stock $ 32,574 $ 31,169 $ 64,700 $ 58,644 Noninterest expense
Net income 42,985 46,527 89,146 87,247 Comprehensive income attributable to Hawaiian Electric $ 32,597 $ 31,195 $ 64,747 $ 58,701 Compensation and employee benefits 25,750 25,512 23,655 51,262 48,095
Preferred stock dividends of subsidiaries 473 473 946 946 OTHER ELECTRIC UTILITY INFORMATION Occupancy 5,479 4,670 4,194 10,149 8,474
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301 Kilowatthour sales (millions) Data processing 3,852 3,738 3,540 7,590 7,004
Basic earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaiian Electric 1,593 1,597 3,016 3,094 Services 2,606 2,426 3,028 5,032 6,075
Diluted earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaii Electric Light 253 262 498 519 Equipment 2,189 2,064 1,874 4,253 3,602
Dividends declared per common share $ 0.32 $ 0.31 $ 0.64 $ 0.62    Maui Electric 273 269 521 527 Office supplies, printing and postage 1,663 1,360 1,491 3,023 2,998
Weighted-average number of common shares outstanding 108,938 108,842 108,925 108,830 2,119 2,128 4,035 4,140 Marketing 1,323 990 1,085 2,313 1,730
Weighted-average shares assuming dilution 109,255 108,963 109,324 109,053 Average fuel oil cost per barrel $ 88.38 $ 81.84 $ 84.44 $ 81.26 FDIC insurance 628 626 727 1,254 1,440
Net income (loss) for common stock by segment Return on average common equity (twelve months ended)1 7.8 % 7.2 % Other expense 4,519 3,854 4,556 8,373 8,657
Electric utility $ 32,574 $ 31,169 $ 64,700 $ 58,644 Total noninterest expense 48,009 45,240 44,150 93,249 88,075
Bank 17,016 20,561 37,855 39,521 Income before income taxes 21,292 26,162 26,514 47,454 51,014
Other (7,078) (5,676) (14,355) (11,864) Income taxes 4,276 5,323 5,953 9,599 11,493
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301 Net income $ 17,016 $ 20,839 $ 20,561 $ 37,855 $ 39,521
Comprehensive income attributable to Hawaiian Electric Industries, Inc. $ 56,211 $ 42,229 $ 111,140 $ 69,703 Comprehensive income $ 31,291 $ 27,091 $ 16,579 $ 58,382 $ 23,464
Return on average common equity (twelve months ended)1 9.4 % 8.6 % OTHER BANK INFORMATION (annualized %, except as of period end)
Return on average assets 0.96 1.18 1.20 1.07 1.16
Return on average equity 10.46 13.09 13.56 11.76 13.07
Return on average tangible common equity 11.97 15.03 15.68 13.48 15.13
Net interest margin 3.82 3.99 3.76 3.90 3.76
Efficiency ratio 62.36 57.80 60.13 60.06 60.58
Net charge-offs to average loans outstanding 0.29 0.39 0.32 0.34 0.30
As of period end
Nonaccrual loans to loans receivable held for investment 0.79 0.83 0.57
Allowance for loan losses to loans outstanding 1.17 1.12 1.11
Tangible common equity to tangible assets 8.2 8.1 7.6
Tier-1 leverage ratio 8.7 8.7 8.6
Total capital ratio 14.0 13.9 13.9
Dividend paid to HEI (via ASB Hawaii, Inc.) ($ in millions) $ 15.0 $ 18.0 $ 11.1 $ 33.0 $ 22.0

 

Hawaiian Electric Industries, Inc. (HEI) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited) Hawaiian Electric Company, Inc. (Hawaiian Electric) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited) American Savings Bank, F.S.B. STATEMENTS OF INCOME DATA (Unaudited) RECONCILIATION OF GAAP1 TO NON-GAAP MEASURES RECONCILIATION OF GAAP1 TO NON-GAAP MEASURES
Three months ended June 30 Six months ended June 30 This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC.Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. This information should be read in conjunction with the consolidated financial statements and the notes thereto in Hawaiian Electric filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. Hawaiian Electric Industries, Inc. and Subsidiaries (HEI) Note:  Columns may not foot due to rounding Hawaiian Electric Company, Inc. (Hawaiian Electric) and Subsidiaries
(in thousands, except per share amounts) 2019 2018 2019 2018 Three months ended June 30 Six months ended June 30 Three months ended Six months ended June 30 Unaudited Twelve months ended June 30 1  Accounting principles generally accepted in the United States of America Unaudited
Revenues 1  On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 9.4% and 9.2%, respectively.  See reconciliation of GAAP to non-GAAP measures. ($ in thousands, except per barrel amounts) 2019 2018 2019 2018 1  Simple average. On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 7.8% and 7.7%, respectively.  See reconciliation of GAAP to non-GAAP measures. ($ in thousands) June 30, 2019 March 31, 2019 June 30, 2018 2019 2018 ($ in millions) 2019 2018 2  Reflects the lower rates enacted by federal tax reform, primarily the adjustments to reduce the unregulated net deferred tax asset balances Twelve months ended June 30
Electric utility $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553 Revenues $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553 Interest and dividend income HEI CONSOLIDATED NET INCOME 3  Calculated as core net income divided by average GAAP common equity ($ in millions) 2019 2018
Bank 81,687 77,104 164,739 152,523 Expenses Interest and fees on loans $ 58,620 $ 57,860 $ 54,633 $ 116,480 $ 107,433 GAAP (as reported) $ 203.7 $ 178.7 HAWAIIAN ELECTRIC CONSOLIDATED NET INCOME
Other 14 47 82 75 Fuel oil 181,620 171,717 342,229 338,685 Interest and dividends on investment securities 7,535 10,628 8,628 18,163 17,830 Excluding special items (after-tax): GAAP (as reported) $ 149.7 $ 131.5
Total revenues 715,485 685,277 1,377,100 1,331,151 Purchased power 162,854 160,738 297,299 300,648 Total interest and dividend income 66,155 68,488 63,261 134,643 125,263 One-time non-executive bank employee bonus related to federal tax reform 0.7 Excluding special items (after-tax):
Expenses Other operation and maintenance 119,260 112,642 237,390 220,252 Interest expense Federal tax reform impacts2 13.4 Federal tax reform impacts2 9.2
Electric utility 578,090 552,982 1,100,025 1,072,040 Depreciation 53,913 50,361 107,860 100,827 Interest on deposit liabilities 4,287 4,252 3,284 8,539 6,241 Non-GAAP (core) net income $ 203.7 $ 192.9 Non-GAAP (core) net income $ 149.7 $ 140.7
Bank 60,435 50,187 117,365 100,719 Taxes, other than income taxes 60,443 57,524 115,247 111,628 Interest on other borrowings 411 528 393 939 889 HEI CONSOLIDATED AVERAGE COMMON EQUITY $ 2,155.8 $ 2,089.0 HAWAIIAN ELECTRIC CONSOLIDATED AVERAGE COMMON EQUITY $ 1,912.0 $ 1,827.9
Other 4,326 3,309 9,139 7,704 Total expenses 578,090 552,982 1,100,025 1,072,040 Total interest expense 4,698 4,780 3,677 9,478 7,130 HEI CONSOLIDATED RETURN ON AVERAGE COMMON EQUITY (ROACE) (simple average) HAWAIIAN ELECTRIC CONSOLIDATED RETURN ON AVERAGE COMMON EQUITY (ROACE) (simple average)
Total expenses 642,851 606,478 1,226,529 1,180,463 Operating income 55,694 55,144 112,254 106,513 Net interest income 61,457 63,708 59,584 125,165 118,133 Based on GAAP 9.4 % 8.6 % Based on GAAP 7.8 % 7.2 %
Operating income (loss) Allowance for equity funds used during construction 3,175 2,983 6,085 6,277 Provision for loan losses 7,688 6,870 2,763 14,558 6,304 Based on non-GAAP (core)3 9.4 % 9.2 % Based on non-GAAP (core)3 7.8 % 7.7 %
Electric utility 55,694 55,144 112,254 106,513 Retirement defined benefits expense—other than service costs (701) (988) (1,404) (2,252) Net interest income after provision for loan losses 53,769 56,838 56,821 110,607 111,829
Bank 21,252 26,917 47,374 51,804 Interest expense and other charges, net (18,530) (18,160) (36,516) (35,854) Noninterest income Three months ended June 30 Six months ended June 30
Other (4,312) (3,262) (9,057) (7,629) Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809 Fees from other financial services 4,798 4,562 4,744 9,360 9,398 ($ in millions) 2019 2018 2019 2018
Total operating income 72,634 78,799 150,571 150,688 Income before income taxes 40,817 40,344 82,676 77,493 Fee income on deposit liabilities 5,004 5,078 5,138 10,082 10,327 HAWAIIAN ELECTRIC CONSOLIDATED OTHER OPERATION AND MAINTENANCE (O&M) EXPENSE
Retirement defined benefits expense—other than service costs (761) (1,564) (1,524) (3,397) Income taxes 7,744 8,676 16,978 17,851 Fee income on other financial products 1,830 1,593 1,675 3,423 3,329 GAAP (as reported) $ 119.3 $ 112.6 $ 237.4 $ 220.3
Interest expense, net—other than on deposit liabilities and other bank borrowings (23,533) (22,001) (46,656) (43,519) Net income 33,073 31,668 65,698 59,642 Bank-owned life insurance 2,390 2,259 1,133 4,649 2,004       Excluding other O&M-related net income neutral items4 0.4 0.1 0.5 0.5
Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809 Preferred stock dividends of subsidiaries 229 229 458 458 Mortgage banking income 976 614 617 1,590 1,230 Non-GAAP (Adjusted other O&M expense) $ 118.9 $ 112.5 $ 236.9 $ 219.8
Allowance for equity funds used during construction 3,175 2,983 6,085 6,277 Net income attributable to Hawaiian Electric 32,844 31,439 65,240 59,184 Other income, net 534 458 536 992 972
Income before income taxes 52,694 59,582 110,733 112,858 Preferred stock dividends of Hawaiian Electric 270 270 540 540 Total noninterest income 15,532 14,564 13,843 30,096 27,260
Income taxes 9,709 13,055 21,587 25,611 Net income for common stock $ 32,574 $ 31,169 $ 64,700 $ 58,644 Noninterest expense
Net income 42,985 46,527 89,146 87,247 Comprehensive income attributable to Hawaiian Electric $ 32,597 $ 31,195 $ 64,747 $ 58,701 Compensation and employee benefits 25,750 25,512 23,655 51,262 48,095
Preferred stock dividends of subsidiaries 473 473 946 946 OTHER ELECTRIC UTILITY INFORMATION Occupancy 5,479 4,670 4,194 10,149 8,474
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301 Kilowatthour sales (millions) Data processing 3,852 3,738 3,540 7,590 7,004
Basic earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaiian Electric 1,593 1,597 3,016 3,094 Services 2,606 2,426 3,028 5,032 6,075
Diluted earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaii Electric Light 253 262 498 519 Equipment 2,189 2,064 1,874 4,253 3,602
Dividends declared per common share $ 0.32 $ 0.31 $ 0.64 $ 0.62    Maui Electric 273 269 521 527 Office supplies, printing and postage 1,663 1,360 1,491 3,023 2,998
Weighted-average number of common shares outstanding 108,938 108,842 108,925 108,830 2,119 2,128 4,035 4,140 Marketing 1,323 990 1,085 2,313 1,730
Weighted-average shares assuming dilution 109,255 108,963 109,324 109,053 Average fuel oil cost per barrel $ 88.38 $ 81.84 $ 84.44 $ 81.26 FDIC insurance 628 626 727 1,254 1,440
Net income (loss) for common stock by segment Return on average common equity (twelve months ended)1 7.8 % 7.2 % Other expense 4,519 3,854 4,556 8,373 8,657
Electric utility $ 32,574 $ 31,169 $ 64,700 $ 58,644 Total noninterest expense 48,009 45,240 44,150 93,249 88,075
Bank 17,016 20,561 37,855 39,521 Income before income taxes 21,292 26,162 26,514 47,454 51,014
Other (7,078) (5,676) (14,355) (11,864) Income taxes 4,276 5,323 5,953 9,599 11,493
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301 Net income $ 17,016 $ 20,839 $ 20,561 $ 37,855 $ 39,521
Comprehensive income attributable to Hawaiian Electric Industries, Inc. $ 56,211 $ 42,229 $ 111,140 $ 69,703 Comprehensive income $ 31,291 $ 27,091 $ 16,579 $ 58,382 $ 23,464
Return on average common equity (twelve months ended)1 9.4 % 8.6 % OTHER BANK INFORMATION (annualized %, except as of period end)
Return on average assets 0.96 1.18 1.20 1.07 1.16
Return on average equity 10.46 13.09 13.56 11.76 13.07
Return on average tangible common equity 11.97 15.03 15.68 13.48 15.13
Net interest margin 3.82 3.99 3.76 3.90 3.76
Efficiency ratio 62.36 57.80 60.13 60.06 60.58
Net charge-offs to average loans outstanding 0.29 0.39 0.32 0.34 0.30
As of period end
Nonaccrual loans to loans receivable held for investment 0.79 0.83 0.57
Allowance for loan losses to loans outstanding 1.17 1.12 1.11
Tangible common equity to tangible assets 8.2 8.1 7.6
Tier-1 leverage ratio 8.7 8.7 8.6
Total capital ratio 14.0 13.9 13.9
Dividend paid to HEI (via ASB Hawaii, Inc.) ($ in millions) $ 15.0 $ 18.0 $ 11.1 $ 33.0 $ 22.0

Hawaiian Electric Industries, Inc. (HEI) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited) Hawaiian Electric Company, Inc. (Hawaiian Electric) and Subsidiaries CONSOLIDATED STATEMENTS OF INCOME DATA (Unaudited) American Savings Bank, F.S.B. STATEMENTS OF INCOME DATA (Unaudited) RECONCILIATION OF GAAP1 TO NON-GAAP MEASURES RECONCILIATION OF GAAP1 TO NON-GAAP MEASURES
Three months ended June 30 Six months ended June 30 This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC.Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. This information should be read in conjunction with the consolidated financial statements and the notes thereto in Hawaiian Electric filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. This information should be read in conjunction with the consolidated financial statements and the notes thereto in HEI filings with the SEC. Results of operations for interim periods are not necessarily indicative of results to be expected for future interim periods or the full year. Hawaiian Electric Industries, Inc. and Subsidiaries (HEI) Note:  Columns may not foot due to rounding Hawaiian Electric Company, Inc. (Hawaiian Electric) and Subsidiaries Note:  Columns may not foot due to rounding
(in thousands, except per share amounts) 2019 2018 2019 2018 Three months ended June 30 Six months ended June 30 Three months ended Six months ended June 30 Unaudited Twelve months ended June 30 1  Accounting principles generally accepted in the United States of America Unaudited 1  Accounting principles generally accepted in the United States of America
Revenues 1  On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 9.4% and 9.2%, respectively.  See reconciliation of GAAP to non-GAAP measures. ($ in thousands, except per barrel amounts) 2019 2018 2019 2018 1  Simple average. On a core basis, 2019 and 2018 returns on average common equity (twelve months ended June 30) were 7.8% and 7.7%, respectively.  See reconciliation of GAAP to non-GAAP measures. ($ in thousands) June 30, 2019 March 31, 2019 June 30, 2018 2019 2018 ($ in millions) 2019 2018 2  Reflects the lower rates enacted by federal tax reform, primarily the adjustments to reduce the unregulated net deferred tax asset balances Twelve months ended June 30 2  Reflects the lower rates enacted by federal tax reform, primarily the adjustments to reduce the unregulated net deferred tax asset balances
Electric utility $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553 Revenues $ 633,784 $ 608,126 $ 1,212,279 $ 1,178,553 Interest and dividend income HEI CONSOLIDATED NET INCOME 3  Calculated as core net income divided by average GAAP common equity ($ in millions) 2019 2018 3  Calculated as core net income divided by average GAAP common equity
Bank 81,687 77,104 164,739 152,523 Expenses Interest and fees on loans $ 58,620 $ 57,860 $ 54,633 $ 116,480 $ 107,433 GAAP (as reported) $ 203.7 $ 178.7 HAWAIIAN ELECTRIC CONSOLIDATED NET INCOME 4  Expenses covered by surcharges or by third parties recorded in revenues
Other 14 47 82 75 Fuel oil 181,620 171,717 342,229 338,685 Interest and dividends on investment securities 7,535 10,628 8,628 18,163 17,830 Excluding special items (after-tax): GAAP (as reported) $ 149.7 $ 131.5
Total revenues 715,485 685,277 1,377,100 1,331,151 Purchased power 162,854 160,738 297,299 300,648 Total interest and dividend income 66,155 68,488 63,261 134,643 125,263 One-time non-executive bank employee bonus related to federal tax reform 0.7 Excluding special items (after-tax):
Expenses Other operation and maintenance 119,260 112,642 237,390 220,252 Interest expense Federal tax reform impacts2 13.4 Federal tax reform impacts2 9.2
Electric utility 578,090 552,982 1,100,025 1,072,040 Depreciation 53,913 50,361 107,860 100,827 Interest on deposit liabilities 4,287 4,252 3,284 8,539 6,241 Non-GAAP (core) net income $ 203.7 $ 192.9 Non-GAAP (core) net income $ 149.7 $ 140.7
Bank 60,435 50,187 117,365 100,719 Taxes, other than income taxes 60,443 57,524 115,247 111,628 Interest on other borrowings 411 528 393 939 889 HEI CONSOLIDATED AVERAGE COMMON EQUITY $ 2,155.8 $ 2,089.0 HAWAIIAN ELECTRIC CONSOLIDATED AVERAGE COMMON EQUITY $ 1,912.0 $ 1,827.9
Other 4,326 3,309 9,139 7,704 Total expenses 578,090 552,982 1,100,025 1,072,040 Total interest expense 4,698 4,780 3,677 9,478 7,130 HEI CONSOLIDATED RETURN ON AVERAGE COMMON EQUITY (ROACE) (simple average) HAWAIIAN ELECTRIC CONSOLIDATED RETURN ON AVERAGE COMMON EQUITY (ROACE) (simple average)
Total expenses 642,851 606,478 1,226,529 1,180,463 Operating income 55,694 55,144 112,254 106,513 Net interest income 61,457 63,708 59,584 125,165 118,133 Based on GAAP 9.4 % 8.6 % Based on GAAP 7.8 % 7.2 %
Operating income (loss) Allowance for equity funds used during construction 3,175 2,983 6,085 6,277 Provision for loan losses 7,688 6,870 2,763 14,558 6,304 Based on non-GAAP (core)3 9.4 % 9.2 % Based on non-GAAP (core)3 7.8 % 7.7 %
Electric utility 55,694 55,144 112,254 106,513 Retirement defined benefits expense—other than service costs (701) (988) (1,404) (2,252) Net interest income after provision for loan losses 53,769 56,838 56,821 110,607 111,829
Bank 21,252 26,917 47,374 51,804 Interest expense and other charges, net (18,530) (18,160) (36,516) (35,854) Noninterest income Three months ended June 30 Six months ended June 30
Other (4,312) (3,262) (9,057) (7,629) Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809 Fees from other financial services 4,798 4,562 4,744 9,360 9,398 ($ in millions) 2019 2018 2019 2018
Total operating income 72,634 78,799 150,571 150,688 Income before income taxes 40,817 40,344 82,676 77,493 Fee income on deposit liabilities 5,004 5,078 5,138 10,082 10,327 HAWAIIAN ELECTRIC CONSOLIDATED OTHER OPERATION AND MAINTENANCE (O&M) EXPENSE
Retirement defined benefits expense—other than service costs (761) (1,564) (1,524) (3,397) Income taxes 7,744 8,676 16,978 17,851 Fee income on other financial products 1,830 1,593 1,675 3,423 3,329 GAAP (as reported) $ 119.3 $ 112.6 $ 237.4 $ 220.3
Interest expense, net—other than on deposit liabilities and other bank borrowings (23,533) (22,001) (46,656) (43,519) Net income 33,073 31,668 65,698 59,642 Bank-owned life insurance 2,390 2,259 1,133 4,649 2,004       Excluding other O&M-related net income neutral items4 0.4 0.1 0.5 0.5
Allowance for borrowed funds used during construction 1,179 1,365 2,257 2,809 Preferred stock dividends of subsidiaries 229 229 458 458 Mortgage banking income 976 614 617 1,590 1,230 Non-GAAP (Adjusted other O&M expense) $ 118.9 $ 112.5 $ 236.9 $ 219.8
Allowance for equity funds used during construction 3,175 2,983 6,085 6,277 Net income attributable to Hawaiian Electric 32,844 31,439 65,240 59,184 Other income, net 534 458 536 992 972
Income before income taxes 52,694 59,582 110,733 112,858 Preferred stock dividends of Hawaiian Electric 270 270 540 540 Total noninterest income 15,532 14,564 13,843 30,096 27,260
Income taxes 9,709 13,055 21,587 25,611 Net income for common stock $ 32,574 $ 31,169 $ 64,700 $ 58,644 Noninterest expense
Net income 42,985 46,527 89,146 87,247 Comprehensive income attributable to Hawaiian Electric $ 32,597 $ 31,195 $ 64,747 $ 58,701 Compensation and employee benefits 25,750 25,512 23,655 51,262 48,095
Preferred stock dividends of subsidiaries 473 473 946 946 OTHER ELECTRIC UTILITY INFORMATION Occupancy 5,479 4,670 4,194 10,149 8,474
Net income for common stock $ 42,512 $ 46,054 $ 88,200 $ 86,301 Kilowatthour sales (millions) Data processing 3,852 3,738 3,540 7,590 7,004
Basic earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaiian Electric 1,593 1,597 3,016 3,094 Services 2,606 2,426 3,028 5,032 6,075
Diluted earnings per common share $ 0.39 $ 0.42 $ 0.81 $ 0.79    Hawaii Electric Light 253 262 498 519 Equipment 2,189 2,064 1,874 4,253 3,602
Dividends declared per common share $ 0.32 $ 0.31 $ 0.64 $ 0.62    Maui Electric 273 269 521 527 Office supplies, printing and postage 1,663 1,360 1,491 3,023 2,998
Weighted-average number of common shares outstanding 108,938 108,842 108,925 108,830 2,119 2,128 4,035 4,140 Marketing 1,323 990 1,085 2,313 1,730
Weighted-average shares assuming dilution 109,255 108,963 109,324 109,053 Average fuel oil cost per barrel $ 88.38 $ 81.84 $ 84.44 $ 81.26 FDIC insurance 628 626 727