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Philippine power
site defuses
HEI gains

American Savings Bank
and Hawaii utilities help the
firm eke out a 1.9% gain

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By Russ Lynch
Star-Bulletin

Mounting losses at an electric power operation in the Philippines countered strong Hawaii results at Hawaiian Electric Industries Inc., resulting in only a small increase in third-quarter earnings.

HEI had a profit of $22 million for the latest quarter, up 1.9 percent from $21.6 million in the year-earlier period, and per-share earnings were unchanged from last year at 67 cents, the company said yesterday.

Its shares closed down 25 cents today at $32.31 on the New York Stock Exchange. The stock is up nearly 12 percent so far this year.

"Earnings this quarter were basically flat compared to the same period last year," said Robert F. Clarke, chairman, president and chief executive officer. "Strong results from our utilities and savings bank offset higher losses from our international power group."

Hawaii operations continue to benefit from an improvement in the economy, Clarke said.

He warned, however, that continuing losses in the Philippines will bring HEI earnings for the full year below last year's net.

HEI's utilities in Hawaii showed a net profit of $25 million in the latest quarter, up 23 percent from $20.3 million in the 1999 quarter. Utility revenues were up 21.6 percent at $337.3 million, from a year-earlier $277.3 million. Kilowatt-hour sales were up 3 percent due to an increase in tourist arrivals and warmer weather, which meant more use of air conditioners, the company said.

The American Savings Bank subsidiary had a third-quarter net profit of $9.8 million, up 15 percent from $8.5 million in the 1999 quarter. The bank's revenues were up 11.4 percent at $114.3 million, from a year-earlier $102.6 million.

HEI's international power business, dragged down by losses at East Asia Power Resources Corp. in the Philippines, showed a net loss of $9.5 million, a nearly sevenfold increase from the $1.4 million loss a year earlier. The results were hurt by higher fuel prices and a drop in the value of the Philippine peso, the company said.

HEI said it expects to lose money at the Philippine operation again in the fourth quarter and in future periods unless the Philippine currency shows a significant gain in strength and fuel prices drop.