Hawaiian Electric Industries, Inc. Q2 FY2025 earnings call

• Progress on financial strength and resilience, including Hawaii State legislature passing key legislation for Maui Wildfire Tort Litigation settlement, liability cap, and clean energy procurement.
• Wildfire safety strategy implementation with 4-pillared approach, expanding from high to medium risk areas.
• Asset sales: Sold 90.1% of American Savings Bank, Hamakua Energy plant, and Pacific Current solar and battery facilities; strategic review ongoing for remaining Pacific Current biomass plant and remaining American Savings Bank stake.
• Credit rating upgrades from Moody's, S&P, and Fitch recognized progress.

In the second quarter, HEI generated net income of $26.1 million or $0.15 per share. Excluding earnings impacts from asset sales and Maui Wildfire-related expenses, consolidated core net income was $35.4 million or $0.20 per share. Utility core net income was $42.5 million compared to $43.9 million in Q2 2024, driven by higher wildfire mitigation expenses and insurance costs but offset by higher annual revenue adjustment mechanism revenues and better heat rate performance. Holding company core net loss was $7.1 million compared to $15.5 million in Q2 2024, due to lower interest expense from debt retirement and higher interest income.

• Intention to raise $479 million for the second settlement payment by relevering HEI with straight debt and/or convertible debt.
• Expect to provide a view on consolidated rate base growth and CapEx in the November time frame.

Q: Just updated thoughts on how to derisk the second settlement payment and near-term actions?

A: At this point, intention is to raise the money at HEI in the form of either straight debt and/or convertible debt, relevering HEI for the second payment.

Q: When could give more view on consolidated rate base growth and CapEx?

A: Based upon current outlook, should be able to provide that later this year, probably in the November time frame.