HEI reported a quarter dominated by a nonrecurring, substantial loss related to the Maui wildfire tort claims settlement, resulting in a consolidated net loss of $1.295 billion or $11.74 per share for the quarter. This outcome reflects a $1.71 billion pretax loss recorded at the utility due to accruals tied to the proposed Maui settlement, partially offset by other components, with the rest of the group contributing modestly to the overall result. On a core basis, excluding wildfire-related expenses and impairment charges, consolidated net income was $49.1 million and EPS $0.44, down from $54.6 million and $0.50 in Q2 2023, underscoring the impact of wildfire-associated costs on near-term profitability.
Management emphasized a clear path forward from the settlement, including financing plans to fund a $1.99 billion HEI/Hawaiian Electric share of the over $4 billion total settlement. The payments are to begin no earlier than mid-2025 and will be made in four equal annual installments. The company also highlighted a broad wildfire safety and grid-resilience program, with significant capex devoted to mitigation (over 35% of annual capex, about $120 million) and the deployment of weather stations and AI-enabled cameras to improve situational awareness. The ongoing strategic review for American Savings Bank (ASB) remains in progress, with a noncash goodwill impairment recorded at ASB contributing to holding company pressures.
Near-term liquidity remains a focal point. The company disclosed substantial doubt about continued as a going concern due to the financing plan required for the Maui settlement, leading to a suspension of the utility dividend to HEI. Management outlined a broad financing plan—encompassing debt, equity, and equity-linked securities—with discussions ongoing with rating agencies and advisers. While this creates near-term headwinds, the long-run agenda centers on grid hardening, renewable generation expansion, and a resilient service infrastructure for Hawaii, with several major solar-plus-storage projects now in service or close to completion.