<PAGE>
================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report: October 19, 1998
===============================================================================
Exact Name of Registrant Commission I.R.S. Employer
as Specified in Its Charter File Number Identification No.
- --------------------------- ----------- ------------------
Hawaiian Electric Industries, Inc. 1-8503 99-0208097
Hawaiian Electric Company, Inc. 1-4955 99-0040500
State of Hawaii
----------------------------------------------
(State or other jurisdiction of incorporation)
900 Richards Street, Honolulu, Hawaii 96813
----------------------------------------------------------------
(Address of principal executive offices and zip code)
Registrant's telephone number, including area code:
(808) 543-5662 - Hawaiian Electric Industries, Inc. (HEI)
(808) 543-7771 - Hawaiian Electric Company, Inc. (HECO)
None
--------------------------------------------------------------
(Former name or former address, if changed since last report.)
===============================================================================
<PAGE>
Item 5. Other Events
(A) On October 19, 1998, HEI issued the following news release:
HAWAIIAN ELECTRIC INDUSTRIES, INC. REPORTS THIRD QUARTER 1998 EARNINGS
HONOLULU -- Hawaiian Electric Industries, Inc. (NYSE - HE) today reported
net income from continuing operations for the three months ended September 30,
1998 of $27.8 million, or 87 cents per share, compared with $27.4 million, or 87
cents per share, in the same quarter of 1997. For the nine months ended
September 30, 1998, net income from continuing operations was $73.5 million, or
$2.30 per share, compared with $68.0 million, or $2.18 per share, in the same
period of 1997.
Net income for the three months ended September 30, 1998 amounted to $19.1
million, or 60 cents per share, compared with $24.1 million, or 77 cents per
share, in the same quarter of 1997. For the nine months ended September 30,
1998, net income was $63.7 million, or $1.99 per share, compared with $63.6
million, or $2.04 per share, in the same period of 1997. Net income for the
three and nine months ended September 30, 1998 includes a net loss from
discontinued operations of $8.7 million and $9.8 million, respectively.
"HEI earnings from continuing operations this quarter were flat compared to
the third quarter of last year, reflecting Hawaii's weak economy," said Robert
F. Clarke, HEI chairman, president and chief executive officer. "Overall we
reported a decline in net income for the quarter due to a net loss from our
discontinued operations," Clarke said.
Electric utility operating income during the quarter was slightly higher at
$51.3 million compared with $48.1 million in the same quarter of 1997.
Operating income for the nine months was $135.5 million versus $127.1 million in
the same period last year.
"Our utilities have been working very hard on initiatives to keep costs
down to offset a decline in sales. Hawaii's poor economy and cooler weather
have reduced sales this year and caused us to revise our 5-year sales forecast
downward. Our utilities expect the economy and sales to pick up beginning in
2000," Clarke said.
Kilowatthour sales for the quarter and nine months were down 2.1% and 1.5%,
respectively, from the same periods of 1997. Hawaii's poor economy has been the
primary reason for lower sales. Through August, visitor arrivals in Hawaii were
1% lower compared with the first eight months of 1997. In addition, cooler
temperatures on Oahu through September resulted in lower residential and
commercial air conditioning usage. Cooling degree days on Oahu through
September were 8% lower than the comparable period of 1997. In light of current
economic conditions, the utilities have revised their 5-year (1998-2002) sales
forecast downward. The forecasted 5-year average annual compounded growth rate
has been lowered to 0.3% from 1.0%. The Company expects kilowatthour sales to
decline by 1.4% in 1998 and 0.7% in 1999, and to pick up thereafter, assuming
the economy improves.
The savings bank subsidiary reported operating income of $13.4 million for
the quarter compared with $11.8 million in the same quarter of 1997. Operating
income for the nine months was $42.1 million versus $36.4 million in the same
period last year.
"Our savings bank has performed well since the acquisition of Bank of
America's Hawaii operations in December 1997. However, Hawaii's soft economy
has reduced some of the earnings increase expected from the acquisition," Clarke
said. With higher delinquencies, the savings bank continued to increase its
provision for loan losses. Net charge-offs, however, remain low at 0.12% of
average loans outstanding. The bank's interest rate spread - the difference
between the yield on earning assets and cost of funds - was 3.10% for the nine
months versus 2.96% in the same period last year. The bank's year-to-date
average earning assets were up 47% from the same period of 1997.
1
<PAGE>
Last year's third quarter operating loss from other operations and the
corporate parent included a $3 million investment gain recognized by the
company's passive investment subsidiary.
The company recorded an after-tax loss of $23.6 million due to the
discontinuance of its residential real estate operation in the third quarter of
1998. This loss was offset in part by an after-tax gain of $13.8 million from
the settlement of HEI's claims against three insurance carriers relating to the
1994 settlement of a lawsuit concerning the company's formerly owned property
and casualty insurance subsidiary.
Interest expense increased due to higher borrowings to finance the
acquisition of Bank of America's Hawaii operations.
Hawaiian Electric Industries is a diversified holding company that delivers
essential services to the people of Hawaii. Its core businesses are electric
utilities and a savings bank. Other subsidiaries are involved in maritime
freight transportation and independent power and integrated energy services
projects in Asia and the Pacific.
FORWARD-LOOKING INFORMATION
THIS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING OF SECTION
21E OF THE SECURITIES EXCHANGE ACT OF 1934. EXCEPT FOR HISTORICAL INFORMATION
CONTAINED HEREIN, THE MATTERS SET FORTH ARE FORWARD-LOOKING STATEMENTS THAT
INVOLVE CERTAIN RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO
DIFFER MATERIALLY FROM THOSE IN THE FORWARD-LOOKING STATEMENTS. POTENTIAL RISKS
AND UNCERTAINTIES INCLUDE, BUT ARE NOT LIMITED TO, SUCH FACTORS AS THE EFFECT OF
INTERNATIONAL, NATIONAL AND LOCAL ECONOMIC CONDITIONS, INCLUDING THE CONDITION
OF THE HAWAII TOURIST AND CONSTRUCTION INDUSTRIES; PRODUCT DEMAND AND MARKET
ACCEPTANCE RISKS, INCREASING COMPETITION IN THE ELECTRIC UTILITY INDUSTRY;
CAPACITY AND SUPPLY CONSTRAINTS OR DIFFICULTIES; NEW TECHNOLOGICAL DEVELOPMENTS
AND GOVERNMENTAL AND REGULATORY ACTIONS. INVESTORS ARE ALSO DIRECTED TO
CONSIDER OTHER RISKS AND UNCERTAINTIES DISCUSSED IN OTHER PERIODIC REPORTS
PREVIOUSLY AND SUBSEQUENTLY FILED BY HEI AND/OR HECO WITH THE SEC.
2
<PAGE>
Hawaiian Electric Industries, Inc. and subsidiaries
CONSOLIDATED STATEMENTS OF INCOME
(unaudited)
<TABLE>
<CAPTION>
Three months Nine months Twelve months
ended ended ended
(in thousands, September 30, September 30, September 30,
except per share amounts) 1998 1997 1998 1997 1998 1997
- -----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
REVENUES
Electric utility $259,684 $282,234 $ 762,494 $ 831,314 $1,038,703 $1,114,941
Savings bank 103,229 71,625 306,324 210,211 390,248 281,262
Other 14,405 16,595 44,023 43,717 59,075 56,777
-------- -------- ---------- ---------- ---------- ----------
377,318 370,454 1,112,841 1,085,242 1,488,026 1,452,980
-------- -------- ---------- ---------- ---------- ----------
EXPENSES
Electric utility 208,418 234,089 626,969 704,179 858,560 946,439
Savings bank 89,831 59,778 264,245 173,843 335,742 234,816
Acquisition costs* - - - - 4,056 -
Other 16,770 15,523 48,753 46,035 65,272 63,376
-------- -------- ---------- ---------- ---------- ----------
315,019 309,390 939,967 924,057 1,263,630 1,244,631
-------- -------- ---------- ---------- ---------- ----------
OPERATING INCOME (LOSS)
Electric utility 51,266 48,145 135,525 127,135 180,143 168,502
Savings bank 13,398 11,847 42,079 36,368 50,450 46,446
Other (2,365) 1,072 (4,730) (2,318) (6,197) (6,599)
-------- -------- ---------- ---------- ---------- ----------
62,299 61,064 172,874 161,185 224,396 208,349
-------- -------- ---------- ---------- ---------- ----------
Interest expense--electric utility and other (17,601) (15,277) (53,345) (46,179) (69,458) (63,404)
Allowance for borrowed funds used during
construction 1,826 1,522 5,145 4,658 6,677 6,918
Preferred stock dividends of electric utility
subsidiaries (1,499) (1,563) (4,507) (4,697) (6,063) (6,218)
Preferred securities distributions of trust
subsidiaries (3,097) (3,064) (9,289) (7,503) (12,386) (7,503)
Allowance for equity funds used during
construction 3,139 2,654 8,781 8,079 11,566 12,623
-------- -------- ---------- ---------- ---------- ----------
INCOME FROM CONTINUING OPERATIONS BEFORE
INCOME TAXES 45,067 45,336 119,659 115,543 154,732 150,765
Income taxes 17,288 17,895 46,140 47,517 57,396 60,398
-------- -------- ---------- ---------- ---------- ----------
Income from continuing operations 27,779 27,441 73,519 68,026 97,336 90,367
-------- -------- ---------- ---------- ---------- ----------
Discontinued operations, net of income taxes
Loss from operations (12,474) (3,303) (13,598) (4,430) (14,569) (5,717)
Net gain on disposal 3,781 - 3,781 - 3,781 -
-------- -------- ---------- ---------- ---------- ----------
LOSS FROM DISCONTINUED OPERATIONS (8,693) (3,303) (9,817) (4,430) (10,788) (5,717)
-------- -------- ---------- ---------- ---------- ----------
NET INCOME $ 19,086 $ 24,138 $ 63,702 $ 63,596 $ 86,548 $ 84,650
======== ======== ========== ========== ========== ==========
Per common share
Basic earnings (loss)
Continuing operations $ 0.87 $ 0.87 $ 2.30 $ 2.18 $ 3.05 $ 2.90
Discontinued operations (0.27) (0.10) (0.31) (0.14) (0.34) (0.18)
-------- -------- ---------- ---------- ---------- ----------
$ 0.60 $ 0.77 $ 1.99 $ 2.04 $ 2.71 $ 2.72
======== ======== ========== ========== ========== ==========
Diluted earnings (loss)
Continuing operations $ 0.86 $ 0.87 $ 2.29 $ 2.17 $ 3.04 $ 2.90
Discontinued operations (0.27) (0.11) (0.31) (0.14) (0.34) (0.19)
-------- -------- ---------- ---------- ---------- ----------
$ 0.59 $ 0.76 $ 1.98 $ 2.03 $ 2.70 $ 2.71
======== ======== ========== ========== ========== ==========
Dividends $ 0.62 $ 0.61 $ 1.86 $ 1.83 $ 2.47 $ 2.44
======== ======== ========== ========== ========== ==========
Weighted average number of common shares
outstanding 32,010 31,528 31,992 31,244 31,935 31,108
======== ======== ========== ========== ========== ==========
Adjusted weighted average shares 32,138 31,627 32,130 31,329 32,070 31,193
======== ======== ========== ========== ========== ==========
</TABLE>
. One-time expenses incurred by ASB related to the acquisition in December 1997
of most of Bank of America - Hawaii operations ($2.4 million after tax).
<TABLE>
<CAPTION>
<S> <C> <C>
Income from continuing operations excluding acquisition costs $99,778 $90,367
======= =======
Basic earnings per common share from continuing operations
excluding acquisition costs $ 3.12 $ 2.90
======= =======
</TABLE>
This information should be read in conjunction with the consolidated financial
statements and the notes thereto incorporated by reference in HEI's Annual
Report on SEC Form 10-K for the year ended December 31, 1997 and the
consolidated financial statements and the notes thereto in HEI's Quarterly
Report on SEC Form 10-Q for the quarters ended March 31, 1998, June 30, 1998
and September 30, 1998 (when filed).
Results of operations for interim periods are not necessarily indicative of
results to be expected for future interim periods or the full year.
3
<PAGE>
(B) The following information about HECO and its subsidiaries will be included
in a Form S-3 registration statement to be filed by HECO related to the issuance
of trust preferred securities, the proceeds from the sale of which are expected
to be used to redeem certain issues of preferred stock.
4
<PAGE>
SELECTED CONSOLIDATED FINANCIAL INFORMATION
The following selected consolidated financial information should be read in
conjunction with HECO's consolidated financial statements and the notes
thereto, and "Management's Discussion and Analysis of Financial Condition and
Results of Operations," included in the Incorporated Documents. The
consolidated Income Statement and Operating Data for each of the years in the
three-year period ended December 31, 1997 are derived from, and are qualified
by reference to, the audited consolidated financial statements included in the
Incorporated Documents. The consolidated Income Statement and Operating Data
for the nine months ended September 30, 1997 and 1998, and the Capitalization
Data as of September 30, 1998, are derived from unaudited consolidated financial
statements, which, in the opinion of management, include all material
adjustments, consisting only of normal recurring adjustments, unless otherwise
noted, necessary for a fair presentation of HECO's consolidated financial
position as of September 30, 1998 and results of operations for the nine-month
periods ended September 30, 1997 and 1998. The results of operations for the
nine months ended September 30, 1998 may not necessarily be indicative of the
results to be expected for the full calendar year. The historical results are
not necessarily indicative of the results of operations to be expected in the
future.
<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEARS ENDED DECEMBER 31, SEPTEMBER 30,
------------------------------ -----------------
1995 1996 1997 1997 1998
-------- ---------- ---------- -------- --------
(DOLLARS IN THOUSANDS, EXCEPT PER BARREL
AMOUNTS)
<S> <C> <C> <C> <C> <C>
INCOME STATEMENT AND OPERATING
DATA:
Operating Revenues............ $981,990 $1,071,426 $1,098,755 $824,762 $755,615
-------- ---------- ---------- -------- --------
Operating Expenses:
Fuel Oil..................... 207,001 250,544 257,002 196,065 149,734
Purchased Power.............. 276,364 286,077 292,852 218,462 204,822
Other Operating Expenses..... 395,903 426,014 437,861 328,078 314,187
-------- ---------- ---------- -------- --------
Total Operating Expenses..... 879,268 962,635 987,715 742,605 668,743
-------- ---------- ---------- -------- --------
Operating Income.............. $102,722 $ 108,791 $ 111,040 $ 82,157 $ 86,872
======== ========== ========== ======== ========
Allowance for Equity Funds
Used During Construction..... $ 10,202 $ 11,741 $ 10,864 $ 8,079 $ 8,781
Income Before Interest and
Other Charges(1)............. $119,047 $ 129,466 $ 130,082 $ 96,390 $102,092
Allowance for Borrowed Funds
Used During Construction..... $ 5,112 $ 5,862 $ 6,190 $ 4,658 $ 5,145
Income Before Preferred Stock
Dividends of HECO(2)......... $ 77,023 $ 85,213 $ 81,849 $ 60,500 $ 65,519
Net Income for Common Stock... $ 72,897 $ 81,348 $ 78,189 $ 57,754 $ 62,927
Ratio of Earnings to Fixed
Charges(3)................... 3.46 3.58 3.26 3.24 3.36
Ratio of Earnings to Combined
Fixed Charges and Preferred
Stock Dividends(3)........... 3.10 3.23 2.99 2.97 3.10
Average Fuel Oil Cost Per
Barrel....................... $ 20.47 $ 24.08 $ 25.19 $ 25.54 $ 19.77
Kilowatthour Sales
(Millions)................... 8,806 8,991 8,963 6,704 6,601
</TABLE>
<TABLE>
<CAPTION>
AS OF SEPTEMBER 30, 1998 AS ADJUSTED(5)
--------------------------- ---------------------------
(DOLLARS IN (% OF TOTAL (DOLLARS IN (% OF TOTAL
THOUSANDS) CAPITALIZATION) THOUSANDS) CAPITALIZATION)
----------- --------------- ----------- ---------------
<S> <C> <C> <C> <C>
CAPITALIZATION DATA:
Short-Term Debt......... $ 95,434 5.8% $ 92,514 5.6%
Long-Term Debt
(including $30 million
due within one
year)(4)............... 643,137 38.8 643,137 38.8
HECO Obligated Mandatory
Redeemable Trust
Preferred Securities of
Subsidiary Trust
holding solely HECO and
HECO-Guaranteed
Debentures............. 50,000 3.0 100,000 6.0
Preferred Stock with
Mandatory Redemption
Requirements (including
sinking fund
requirements due within
one year).............. 33,180 2.0 100 0
Preferred Stock without
Mandatory Redemption
Requirements........... 48,293 2.9 34,293 2.1
Common Stock Equity..... 788,470 47.5 788,470 47.5
---------- ----- ---------- -----
Total Capitalization... $1,658,514 100.0% $1,658,514 100.0%
========== ===== ========== =====
</TABLE>
5
<PAGE>
- --------
(1) Income Before Interest and Other Charges includes Operating Income plus the
Allowance for Equity Funds Used During Construction and nonoperating
income.
(2) Income Before Preferred Stock Dividends of HECO includes Income Before
Interest and Other Charges, less interest (reduced by Allowance for
Borrowed Funds Used During Construction), amortization of net bond premium
and expense, preferred stock dividends of HELCO and MECO and preferred
securities distributions of trust subsidiary.
(3) See "Ratios of Earnings to Fixed Charges and to Combined Fixed Charges and
Preferred Stock Dividends."
(4) The Department of Budget and Finance of the State of Hawaii is currently
authorized to issue up to an additional $188 million of special purpose
revenue bonds and to loan the proceeds to the Companies. Long-Term Debt
will increase from time to time as approximately $38.5 million of undrawn
proceeds as of September 30, 1998 from the previous sale of special
purchase revenue bonds and proceeds from the future sale of special purpose
revenue bonds, are drawn down.
(5) Adjusted to reflect (i) the issuance and sale of the QUIPS offered hereby
and (ii) the anticipated application of the QUIPS proceeds to redeem
certain series of the preferred stock of each of the Companies and to
reduce short-term debt. The adjusted capitalization does not reflect the
application of QUIPS proceeds for the payment of redemption premiums,
although a portion of the QUIPS proceeds is expected to be used for this
purpose. See "Use of Proceeds" and "Accounting Treatment." The preferred
stock redemptions expected to be funded from the proceeds of QUIPS are
anticipated to occur in mid-January, 1999.
The following table summarizes certain financial information for the
Companies on a consolidated basis ("HECO Consolidated") and for MECO and HELCO,
individually. None of the information in the table is audited, except that the
financial information for HECO Consolidated as of December 31, 1997 is derived
from audited financial information.
<TABLE>
<CAPTION>
HECO CONSOLIDATED MECO HELCO
-------------------------- -------------------------- --------------------------
DECEMBER 31, SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30, DECEMBER 31, SEPTEMBER 30,
1997 1998 1997 1998 1997 1998
------------ ------------- ------------ ------------- ------------ -------------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
BALANCE SHEET DATA:
Current assets.......... $ 168,597 $ 156,772 $ 31,994 $ 28,063 $ 28,631 $ 26,369
Noncurrent assets....... 2,043,717 2,089,927 374,766 383,459 403,981 417,764
---------- ---------- -------- -------- -------- --------
$2,212,314 $2,246,699 $406,760 $411,522 $432,612 $444,133
========== ========== ======== ======== ======== ========
Common stock equity..... $ 769,235 $ 788,470 $150,129 $153,568 $144,761 $147,909
Cumulative
preferred stock
Not subject
to mandatory
redemption............ 48,293 48,293 8,000 8,000 10,000 10,000
Subject to mandatory
redemption............ 33,175 31,585 5,575 5,385 7,000 7,000
HECO obligated mandatory
redeemable trust
preferred securities of
subsidiary trust
holding solely HECO and
HECO-guaranteed
debentures............. 50,000 50,000
Current liabilities..... 271,791 267,733 24,454 22,916 63,500 59,810
Noncurrent liabilities.. 1,039,820 1,060,618 218,602 221,653 207,351 219,414
---------- ---------- -------- -------- -------- --------
$2,212,314 $2,246,699 $406,760 $411,522 $432,612 $444,133
========== ========== ======== ======== ======== ========
<CAPTION>
NINE MONTHS ENDED NINE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30, SEPTEMBER 30,
-------------------------- -------------------------- --------------------------
1997 1998 1997 1998 1997 1998
------------ ------------- ------------ ------------- ------------ -------------
(IN THOUSANDS)
<S> <C> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Operating revenues...... $ 824,762 $ 755,615 $115,393 $103,353 $120,037 $115,536
Operating income........ $ 82,157 $ 86,872 $ 13,288 $ 14,570 $ 13,106 $ 14,523
Net income for common
stock.................. $ 57,754 $ 62,927 $ 9,828 $ 11,378 $ 10,833 $ 12,331
</TABLE>
6
<PAGE>
CAPITAL EXPENDITURE PROGRAMS AND FINANCING REQUIREMENTS
CAPITAL EXPENDITURE PROGRAMS
Capital expenditures include the costs of projects which are required to meet
expected load growth, to improve reliability, and to replace and upgrade
existing equipment. Gross capital expenditures requiring the use of cash
totaled approximately $122.1 million in 1997, of which $75.6 million was
attributable to HECO, $18.0 million to MECO and $28.5 million to HELCO.
Approximately 76% of the 1997 gross capital expenditures was for transmission
and distribution projects and approximately 24% was for generation and general
plant projects. Cash contributions in aid of construction received in 1997
totaled $7.1 million.
The Companies' current consolidated forecast of net capital expenditures,
which excludes the allowance for funds used during construction ("AFUDC") and
capital expenditures funded by third-party contributions in aid of
construction, for the five-year period 1998 through 2002, is approximately
$592 million. Approximately 72% of gross capital expenditures forecast for this
period, including AFUDC and third-party contributions in aid of construction,
is for transmission and distribution projects, with the remaining 28% primarily
for generation projects.
Capital expenditure estimates and the timing of construction projects are
reviewed periodically by management and may change significantly as a result of
many considerations, including changes in economic conditions, changes in
forecasts of kilowatthour sales and peak load, the availability of purchased
power, the availability of generating sites and transmission and distribution
corridors, the ability to obtain adequate and timely rate relief, escalations
in construction costs, demand side management programs and requirements of
environmental and other regulatory and permitting authorities.
FINANCING REQUIREMENTS
The Companies' consolidated requirements for funds in the years 1998 through
2002, including net capital expenditures, debt retirements (exclusive of
reductions in levels of short-term borrowings) and contemplated preferred stock
redemptions are currently estimated to total $672 million. HECO's consolidated
internal sources, after payment of common stock and preferred stock dividends,
are currently expected to provide approximately 80% of the $672 million in
total requirements. Debt and equity financings, including the issuance and sale
of the QUIPS, are expected to provide the remaining requirements. The PUC must
approve issuances of long-term debt and equity for HECO, MECO and HELCO, and
has been requested to approve the issuance of the QUIDS to be purchased by the
Trust from the proceeds of the Common Securities and the QUIPS offered hereby.
Prior approval of the PUC will also be required before the Substituted HECO
QUIDS may be issued to effect an exchange of Substituted HECO QUIDS for HELCO
QUIDS and MECO QUIDS.
RATIOS OF EARNINGS TO FIXED CHARGES AND TO
COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
The following table sets forth HECO's consolidated ratios of earnings to
fixed charges, and to combined fixed charges and preferred stock dividends, for
the periods indicated:
<TABLE>
<CAPTION>
NINE MONTHS
ENDED
YEARS ENDED DECEMBER 31, SEPTEMBER 30,
------------------------ -------------
1993 1994 1995 1996 1997 1997 1998
---- ---- ---- ---- ---- ------ ------
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges..... 3.25 3.47 3.46 3.58 3.26 3.24 3.36
Ratio of Earnings to Combined Fixed
Charges and Preferred Stock
Dividends............................. 2.81 3.03 3.10 3.23 2.99 2.97 3.10
</TABLE>
7
<PAGE>
In computing the Ratio of Earnings to Fixed Charges, earnings represent
Income Before Preferred Stock Dividends of HECO (reduced by Allowance for
Borrowed Funds Used During Construction) plus federal and state income taxes
and fixed charges. Fixed charges consist of interest on all indebtedness
(without reduction for the Allowance for Borrowed Funds Used During
Construction) plus amortization of net bond premium and expense, pre-tax
preferred stock dividend requirements of MECO and HELCO, the estimated interest
component of rentals and the preferred securities distribution requirements of
HECO Capital Trust I. In computing the Ratio of Earnings to Combined Fixed
Charges and Preferred Stock Dividends, pre-tax preferred stock dividend
requirements of HECO are added to fixed charges.
8
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrants have duly caused this report to be signed on their behalf by the
undersigned thereunto duly authorized. The signature of the undersigned
companies shall be deemed to relate only to matters having reference to such
companies and any subsidiaries thereof.
HAWAIIAN ELECTRIC INDUSTRIES, INC. HAWAIIAN ELECTRIC COMPANY, INC.
(Registrant) (Registrant)
/s/ Robert F. Mougeot /s/ Paul A. Oyer
- ---------------------------------- ---------------------------------
Robert F. Mougeot Paul A. Oyer
Financial Vice President and Financial Vice President and
Chief Financial Officer of HEI Treasurer of HECO
(Principal Financial Officer of HEI) (Principal Financial Officer of HECO)
Date: October 19, 1998 Date: October 19, 1998
9
