Hawaiian Electric Industries, Inc. has recently released its 10-Q report, providing a detailed look into the company's financial condition and operational results. The company operates in three segments: Electric Utility, Bank, and Other. The Electric Utility segment involves the production, purchase, transmission, distribution, and sale of electricity in the islands of Oahu, Hawaii, Maui, Lanai, and Molokai. Its renewable energy sources include wind, solar, geothermal, and hydroelectric power.
In the 10-Q report, Hawaiian Electric Industries, Inc. disclosed several significant developments. Notably, on August 8, 2023, brush fires in the West Maui and Upcountry Maui areas caused widespread property damage and resulted in 102 confirmed fatalities. As of August 8, 2024, the company and its subsidiaries have been named in approximately 700 lawsuits related to the Maui windstorm and wildfires, with civil and class action lawsuits filed against them. The company reached an agreement in principle with all defendants to settle these tort-related legal claims, with a total contribution of approximately $4.04 billion to one or more funds. Hawaiian Electric Industries, Inc. and Hawaiian Electric are expected to contribute approximately $1.99 billion to the settlement.
Furthermore, the 10-Q report outlined the impact of the Maui windstorm and wildfires on the company's financials. For the three months ended June 30, 2024, the company reported operating income loss of $1.72 billion and a net loss for common stock of $1.30 billion. For the six months ended June 30, 2024, the net loss for common stock was $1.25 billion. These losses were primarily attributed to the wildfire tort-related claims and other expenses related to the Maui windstorm and wildfires.
The report also provided insight into the company's Bank segment. It stated that the net interest margin for the second quarter of 2024 was 2.79%, primarily due to the benefit from the sale of investment securities in the fourth quarter of 2023. However, the company noted that the higher interest rate environment has impacted the fair value of the Bank's investment portfolio, resulting in unrealized losses.
Additionally, the report highlighted the economic conditions in Hawaii, stating that the Utility's kWh sales in the second quarter of 2024 were down by 1.2% compared to the same period in 2023, primarily due to the decrease in Maui sales from the Maui windstorm and wildfires and the continued adoption of energy efficiency measures and distributed energy resources.
As a result of these announcements, the company's shares have moved -3.0% on the market, and are now trading at a price of $15.5. If you want to know more, read the company's complete 10-Q report here.
