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SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT
 12 Months Ended
Dec. 31, 2018
Condensed Financial Information Disclosure [Abstract]  
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF REGISTRANT
SCHEDULE I — CONDENSED FINANCIAL INFORMATION OF REGISTRANT
HAWAIIAN ELECTRIC INDUSTRIES, INC. (PARENT COMPANY)
CONDENSED BALANCE SHEETS
December 31
2018

 
2017

(dollars in thousands)
 

 
 

Assets
 

 
 

Cash and cash equivalents
$
3,742

 
$
11,702

Accounts receivable
2,604

 
2,347

Notes receivable
20,789

 
—

Property, plant and equipment, net
3,456

 
3,910

Deferred income tax assets
10,147

 
8,710

Other assets
11,963

 
15,480

Investments in subsidiaries, at equity
2,605,038

 
2,466,342

   Total assets
$
2,657,739

 
$
2,508,491

Liabilities and shareholders’ equity
 

 
 

Liabilities
 

 
 

Accounts payable
$
2,001

 
$
561

Interest payable
3,476

 
2,319

Notes payable to subsidiaries
34

 
1,918

Commercial paper
48,992

 
62,993

Short-term debt, net
—

 
49,953

Long-term debt, net
398,874

 
249,588

Retirement benefits liability
29,565

 
31,518

Other
12,517

 
12,255

   Total liabilities
495,459

 
411,105

Shareholders’ equity
 

 
 

Preferred stock, no par value, authorized 10,000,000 shares; issued: none
—

 
—

Common stock, no par value, authorized 200,000,000 shares; issued and outstanding: 108,879,245
shares and 108,787,807 shares at December 31, 2018 and 2017, respectively
1,669,267

 
1,662,491

Retained earnings
543,623

 
476,836

Accumulated other comprehensive loss
(50,610
)
 
(41,941
)
   Total shareholders’ equity
2,162,280

 
2,097,386

   Total liabilities and shareholders’ equity
$
2,657,739

 
$
2,508,491

SCHEDULE I — CONDENSED FINANCIAL INFORMATION OF REGISTRANT (continued)
HAWAIIAN ELECTRIC INDUSTRIES, INC. (PARENT COMPANY)
CONDENSED STATEMENTS OF INCOME
Years ended December 31
2018

 
2017

 
2016

(in thousands)
 

 
 

 
 

Revenues
$
429

 
$
798

 
$
647

Equity in net income of subsidiaries
226,972

 
187,097

 
199,485

Expenses:
 
 
 

 
 

Operating, administrative and general
19,515

 
16,578

 
17,515

Depreciation of property, plant and equipment
597

 
548

 
566

Taxes, other than income taxes
509

 
496

 
4,726

       Total expenses
20,621

 
17,622

 
22,807

Income before merger termination fee, interest expense and income (taxes) benefits
206,780

 
170,273

 
177,325

Merger termination fee
—

 
—

 
90,000

Income before interest expense and income (taxes) benefits
206,780

 
170,273

 
267,325

Retirement defined benefits expense—other than service costs
674

 
1,119

 
1,186

Interest expense
12,664

 
9,389

 
9,037

Income before income (taxes) benefits
193,442

 
159,765

 
257,102

Income (taxes) benefits
8,332

 
5,532

 
(8,846
)
Net income
$
201,774

 
$
165,297

 
$
248,256


HAWAIIAN ELECTRIC INDUSTRIES, INC. (PARENT COMPANY)
STATEMENTS OF COMPREHENSIVE INCOME
STATEMENTS OF CHANGES IN SHAREHOLDERS’ EQUITY
Incorporated by reference are HEI and Subsidiaries’ Statements of Consolidated Comprehensive Income and Consolidated Statements of Changes in Shareholders’ Equity in Part II, Item 8.
SCHEDULE I — CONDENSED FINANCIAL INFORMATION OF REGISTRANT (continued)
HAWAIIAN ELECTRIC INDUSTRIES, INC. (PARENT COMPANY)
CONDENSED STATEMENTS OF CASH FLOWS
Years ended December 31
2018

 
2017

 
2016

(in thousands)
 
 
 
 
 
Net cash provided by operating activities
$
135,470

 
$
99,600

 
$
191,710

Cash flows from investing activities
 

 
 

 
 

Increase in note receivable from subsidiary
(20,596
)
 
(70,000
)
 
—

Decrease in note receivable from subsidiary
—

 
66,391

 
—

Capital expenditures
(143
)
 
(317
)
 
(212
)
Investments in subsidiaries
(71,970
)
 
(22,353
)
 
(24,000
)
Other
140

 
(177
)
 
1

Net cash used in investing activities
(92,569
)
 
(26,456
)
 
(24,211
)
Cash flows from financing activities
 

 
 

 
 

Net increase (decrease) in notes payable to subsidiaries with original maturities of three months or less
(30
)
 
98

 
(618
)
Net increase (decrease) in short-term borrowings with original maturities of three months or less
(14,000
)
 
62,993

 
(103,063
)
Proceeds from issuance of short-term debt
—

 
125,000

 
—

Repayment of short-term debt
(50,000
)
 
(75,000
)
 
—

Proceeds from issuance of long-term debt
150,000

 
150,000

 
75,000

Repayment of long-term debt
—

 
(200,000
)
 
(75,000
)
Withheld shares for employee taxes on vested share-based compensation
(996
)
 
(3,828
)
 
(2,416
)
Net proceeds from issuance of common stock
—

 
—

 
13,220

Common stock dividends
(134,987
)
 
(134,873
)
 
(117,274
)
Other
(848
)
 
(756
)
 
2,460

Net cash used in financing activities
(50,861
)
 
(76,366
)
 
(207,691
)
Net decrease in cash and equivalents
(7,960
)
 
(3,222
)
 
(40,192
)
Cash and cash equivalents, January 1
11,702

 
14,924

 
55,116

Cash and cash equivalents, December 31
$
3,742

 
$
11,702

 
$
14,924


NOTES TO CONDENSED FINANCIAL INFORMATION

Basis of Presentation
The “Notes to Consolidated Financial Statements” in Part II, Item 8 should be read in conjunction with the above HEI (Parent Company) financial statements. All HEI subsidiaries are reflected in the Condensed Financial Statements under the equity method. Income taxes for equity method investments are included in “Equity in net income of subsidiaries.”
The Condensed Statements of Income Data reflects the retrospective application of ASU No. 2017-07, “Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost,” which was adopted in the first quarter of 2018. Nonservice cost was reclassified from “Operating, general and administrative expenses” to “Retirement defined benefits expense—other than service costs.”
Long-term debt
The components of long-term debt, net, were as follows:
December 31
2018

 
2017

(dollars in thousands)
 

 
 

HEI 2.99% term loan, due 2022
$
150,000

 
$
150,000

HEI 5.67% senior note, due 2021
50,000

 
50,000

HEI 3.99% senior note, due 2023
50,000

 
50,000

HEI 4.58% senior notes, due 2025
50,000

 
—

HEI 4.72% senior notes, due 2028
100,000

 
—

Less unamortized debt issuance costs
(1,126
)
 
(412
)
Long-term debt, net
$
398,874

 
$
249,588

The aggregate payments of principal required within five years after December 31, 2018 on long-term debt are nil in 2019 and 2020, $50 million in 2021, $150 million in 2022 and $50 million in 2023.
Indemnities
As of December 31, 2018, HEI has a General Agreement of Indemnity in favor of both Liberty Mutual Insurance Company (Liberty) and Travelers Casualty and Surety Company of America (Travelers) for losses in connection with any and all bonds, undertakings or instruments of guarantee and any renewals or extensions thereof executed by Liberty or Travelers, including, but not limited to, a $0.6 million self-insured United States Longshore & Harbor bond and a $0.7 million self-insured automobile bond.
Income taxes
The Company’s financial reporting policy for income tax allocations is based upon a separate entity concept whereby each subsidiary provides income tax expense (or benefits) as if each were a separate taxable entity. The difference between the aggregate separate tax return income tax provisions and the consolidated financial reporting income tax provision is charged or credited to HEI’s separate tax provision.
Dividends from HEI subsidiaries
In 2018, 2017 and 2016, cash dividends received from subsidiaries were $154 million, $125 million and $130 million, respectively.
Supplemental disclosures of noncash activities
In 2018, 2017 and 2016, $2.3 million, $2.8 million and $2.3 million, respectively, of HEI accounts receivable from ASB Hawaii were reduced with a corresponding reduction in HEI notes payable to ASB Hawaii in noncash transactions.
In 2018, 2017 and 2016, $2.3 million, $2.8 million and $2.3 million, respectively, were contributed as equity by HEI into ASB Hawaii with a corresponding increase in HEI notes payable to ASB Hawaii in noncash transactions.
In 2017, $3.6 million of HEI notes receivable from Hamakua Energy, LLC were converted to equity in a noncash transaction.
Under the HEI DRIP, common stock dividends reinvested by shareholders in HEI common stock in noncash transactions amounted to nil, nil and $17 million in 2018, 2017 and 2016, respectively. From January 1, 2016 through January 6, 2016 and December 7, 2016 to date, HEI satisfied the share purchase requirements of the DRIP through open market purchases of its common stock rather than new issuances.