O&M expenses 1 (pretax) increased by $40 million or 12% over the prior year, slightly under our expectation for an annual increase of 13%. The increase resulted primarily from generating unit overhauls, a full year of cost for our new biofuels generating unit, CT-1, increased levels of work to address our aging infrastructure, and higher employee benefit costs.
Fourth Quarter Results:
Electric utility net income for the fourth quarter of 2010 was $18.9 million compared to $23.3 million in the fourth quarter of 2009. The decline in net income was primarily attributable to (on an after-tax basis) approximately $3 million from lower kilowatthour sales and $10 million higher O&M expenses 1. These were partially offset by $2 million of rate relief granted in our 2009 Oahu and 2010 Maui rate cases and tax settlement items which net to $6 million.
Kilowatthour sales were down 2.1% in the fourth quarter 2010 compared with the same quarter last year mostly due to cooler and less humid weather.O&M expenses 1 (pretax) were up 23% over the same quarter last year as anticipated. This increase resulted primarily from higher generation unit overhauls, higher transmission and distribution maintenance including vegetation management and substation maintenance, and management’s action to defer work planned for the fourth quarter of 2009 to 2010. HOLDING AND OTHER COMPANIES The holding and other companies’ net losses were $21.5 million in 2010 compared to $18.2 million in 2009 primarily due to the $2 million write-off of a deferred tax asset in the fourth quarter of 2010. The holding and other companies’ net losses were $7.5 million in the fourth quarter of 2010 compared to $5.2 million in the fourth quarter of 2009 primarily reflecting the $2 million write-off mentioned above. WEBCAST AND TELECONFERENCE Hawaiian Electric Industries, Inc. will conduct a webcast and teleconference call to review 2010 earnings on Friday, February 11, 2011, at 8:00 a.m. Hawaii time (1:00 p.m. Eastern time). The event can be accessed through HEI’s website at www.hei.com or by dialing (866) 713-8307, passcode: 10016892 for the teleconference call. HEI intends to continue to use its website, www.hei.com, as a means of disclosing additional information. Such disclosures will be included on HEI’s website in the Investor Relations section. Accordingly, investors should routinely monitor such portions of HEI’s website, in addition to following HEI’s, HECO’s and ASB’s press releases, SEC filings and public conference calls and webcasts. Investors may also wish to refer to the Public Utilities Commission of the State of Hawaii (PUC) website at dms.puc.hawaii.gov/dms in order to review documents filed with and issued by the PUC. An online replay of the webcast will be available at the same website beginning about two hours after the event. Replays of the teleconference call will also be available approximately two hours after the event through February 25, 2011, by dialing (888) 286-8010, passcode: 28298877.
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