Sempra Energy Delivers Strong Full-Year 2020 Financial And Operational Results

- Executing $32 Billion Five-Year Capital Plan

- Increasing U.S. Utilities Capital in 2021-2022 by $1.1 Billion Over Prior Capital Plan

- Progressing Sempra Infrastructure Partners; Expected to Create Additional Shareholder Value

- Reaffirming Full-Year 2021 EPS Guidance Range

- Raising Annualized Common Stock Dividend

SAN DIEGO, Feb. 25, 2021 /PRNewswire/ -- Sempra Energy (NYSE: SRE) today announced full-year 2020 earnings of $3.76 billion, or $12.88 per diluted share, compared to full-year 2019 earnings of $2.06 billion, or $7.29 per diluted share. On an adjusted basis, the company's full-year 2020 earnings were $2.35 billion, or $8.03 per diluted share, compared to $1.91 billion, or $6.78 per diluted share, in 2019. In the fourth quarter of 2020, Sempra Energy reported earnings of $414 million, or $1.43 per diluted share, compared to $447 million, or $1.55 per diluted share, in the fourth quarter of 2019. On an adjusted basis, fourth quarter 2020 earnings were $553 million, or $1.90 per diluted share. There were no adjustments made to fourth quarter 2019 earnings.

"Our strong financial results in 2020 reflect the continued growth in our business and are a credit to our talented workforce and investments in a high-performing culture," said Jeffrey W. Martin, chairman and CEO of Sempra Energy. "As the owner of one of the largest energy networks in North America, we have set a goal of being a leader in transitioning to a lower-carbon future by enabling the delivery of cleaner energy solutions in every market we serve. We envision critical new investments in energy infrastructure playing a vital role in reaching a net-zero energy future, promoting growth across all sectors of the economy and supporting a thriving energy industry."

The reported financial results reflect certain significant items as described on an after-tax basis in the following table of GAAP earnings, reconciled to adjusted earnings, for the fourth quarter and full-year 2020 and 2019.

                     
     

 Three months ended 

 

 Years ended 

 
     

 December 31, 

 

 December 31, 

 
 

(Dollars, except EPS, and shares, in millions)

 

2020

 

2019

 

2020

 

2019

 
     

(Unaudited)

         
 

GAAP Earnings

 

$        414

 

$        447

 

$     3,764

 

$     2,055

 
                     
 

Gain on Sale of South American Businesses

 

-

 

-

 

(1,747)

 

-

 
                     
 

Impacts Associated with Aliso Canyon Litigation and Regulatory Matters

 

139

 

-

 

233

 

-

 
                     
 

Losses from Investment in RBS Sempra Commodities LLP

 

-

 

-

 

100

 

-

 
                     
 

Tax Impacts from Holding the South American Businesses for Sale

 

-

 

-

 

-

 

(99)

 
                     
 

Gain on Sale of Certain Renewables Assets

 

-

 

-

 

-

 

(45)

 
                     
 

Adjusted Earnings(1)

 

$        553

 

$        447

 

$     2,350

 

$     1,911

 
                     
                     
 

GAAP Diluted Weighted-Average Common Shares Outstanding

 

290

 

289

 

292

 

282

 
 

GAAP Earnings Per Diluted Common Share

 

$       1.43

 

$       1.55

 

$     12.88

 

$       7.29

 
                     
 

Adjusted Diluted Weighted-Average Common Shares Outstanding(1)

 

290

 

289

 

306

 

282

 
 

Adjusted Earnings Per Diluted Common Share(1),(2)

 

$       1.90

 

$       1.55

 

$       8.03

 

$       6.78

 
                     
   

1)

Represents a non-GAAP financial measure (GAAP represents accounting principles generally accepted in the United States of America). See Table A for information regarding non-GAAP financial measures.

2)

To calculate Full-Year 2020 Adjusted Earnings-Per-Common-Share (EPS), preferred dividends of $104 million are added back to Adjusted Earnings because of the dilutive effect of Series A mandatory convertible preferred stock.

 

Declaring Dividends and Raising Annualized Common Stock Dividend

Sempra 2020 Q4 infographicThis week, Sempra Energy's board of directors declared a $1.10 per share quarterly dividend on the company's common stock, which is payable April 15, 2021 to common stock shareholders of record as of March 25, 2021. The declared quarterly dividend represents an increase of the company's common stock dividend to $4.40 per share, on an annualized basis, from $4.18 per share in 2020. Over the past decade, we have increased our dividend at a compound annual growth rate of approximately 9% and today's announcement demonstrates the company's continued commitment to generating value for shareholders, while also reinvesting in the future growth of the business.

Sempra Energy's board of directors also declared a quarterly dividend of $1.6875 per share on the company's 6.75% Mandatory Convertible Preferred Stock, Series B. Additionally, the board of directors declared a semi-annual dividend of $24.375 per share on Sempra Energy's 4.875% Fixed-Rate Reset Cumulative Redeemable Perpetual Preferred Stock, Series C. The preferred stock dividends will be payable April 15, 2021 to preferred stock shareholders of record as of April 1, 2021.

Continuing Strong Growth at U.S. Utilities

In combination, San Diego Gas & Electric Co. (SDG&E), Southern California Gas Co. (SoCalGas) and Oncor Electric Delivery Company LLC (Oncor) own and operate some of the largest energy networks in the United States and are expected to play a critical role in delivering lower-carbon energy to the communities they serve, while continuing to invest in safety advancements and clean technologies to help maintain resiliency and reliability. Our U.S. Utilities platform has continued to deliver stable cash flows, improved earnings visibility, and strong organic growth. In 2020, Sempra Energy deployed record capital of approximately $7 billion which was primarily centered on safety and reliability investments at SDG&E, SoCalGas and Oncor. In 2021 to 2025, Sempra Energy's $32 billion capital plan is anchored by continued investments in the company's U.S. Utilities platform with a focus on safety, reliability and decarbonizing the energy system. Compared to Sempra Energy's prior capital plan, the company has increased U.S. Utilities capital in 2021-2022 by approximately $1.1 billion.

In Texas, Oncor has restored power and repaired damages following the unprecedented winter storm that impacted many residents in the state last week. While the severe weather has highlighted the importance of critical energy infrastructure, it also demonstrates the vital role Oncor continues to play in meeting the growing needs of Texas' economy through the execution of its 2021-2025 capital plan. In 2020, Oncor connected approximately 77,000 new premises, exceeding its connections in 2019 by about 20%, which is the highest organic growth in Oncor's history. Oncor also set a company record for new generation interconnection requests it received in 2020, driven by strong development activity in utility-scale generation, with a focus on the renewable and battery storage markets. Additionally, Oncor completed six major transmission projects in West Texas totaling approximately 260 circuit miles and approximately $300 million of investment.

Advancing Sempra Infrastructure Partners Transactions

Sempra Energy continues to make progress on a series of integrated transactions announced in December 2020, intended to simplify its energy infrastructure investments under a common platform – Sempra Infrastructure Partners. The company plans to complete the stock-for-stock exchange offer for the publicly traded shares of Infraestructura Energética Nova, S.A.B. de C.V. (IEnova) and close the sale of a non-controlling interest in Sempra Infrastructure Partners in the second quarter of 2021. The exchange offer and sale of a non-controlling interest are advancing independently and are not contingent upon the timing of the other transaction.

"With increased scale and a strong growth pipeline, Sempra Infrastructure Partners will be well-positioned to help lead the global energy transition," said Martin. "Moreover, we expect the transaction to support an investment grade balance sheet to support the company's future growth."

By simplifying the ownership structure of Sempra LNG and IEnova under Sempra Infrastructure Partners, the company is expected to create additional value for Sempra Energy investors.

Progressing LNG Infrastructure Investments

In November 2020, ECA Liquefaction (ECA LNG), a joint venture between Sempra LNG and IEnova, reached a final investment decision (FID) for the development, construction and operation of the ECA LNG Phase 1 natural gas liquefaction-export project in Baja California, Mexico. ECA LNG Phase 1 is the only liquefied natural gas (LNG) export project in the world to reach FID in 2020. Estimated capital expenditures for ECA LNG Phase 1 are approximately $2 billion. Sempra expects to fund the project with a combination of equity contributions and debt. First LNG production from ECA LNG Phase 1 is expected in late 2024.

Additionally, an affiliate of Total SE has secured a 16.6% equity stake in ECA LNG Phase 1, while Sempra LNG and IEnova have each retained 41.7% ownership.

Building Sustainable Value

Sempra Energy's strong results are underpinned by a commitment to environmental, social and governance matters. The company's recent recognition includes:

  • Fortune Magazine's "World's Most Admired Companies" for 2021;
  • Dow Jones Sustainability World Index, as the only North American utility sector company on the list;
  • Dow Jones Sustainability North American Index;
  • Bloomberg Gender-Equality Index for 2021;
  • Human Rights Campaign's "Best Place to Work for LGBTQ Equality;"
  • Center for Political Accountability-Zicklin Index – Trendsetter in political disclosure practices and accountability for 2020;
  • Chief Executive of the Year at S&P Global Platts' Global Energy Awards;
  • Deal of the Year at S&P Global Platts' Global Energy Awards for the divestiture of the company's South American assets; and
  • National Association of Corporate Directors' NXT Award for excellence in diversity and inclusion.

Earnings Guidance

As a result of Sempra Energy's continued financial execution, the company is reaffirming its full-year 2021 EPS guidance range of $7.50 to $8.10.

Non-GAAP Financial Measures

Non-GAAP financial measures include Sempra Energy's adjusted earnings, adjusted EPS and adjusted diluted weighted-average common shares outstanding. See Table A for additional information regarding these non-GAAP financial measures.

Internet Broadcast

Sempra Energy will broadcast a live discussion of its earnings results over the Internet today at 12 p.m. ET with senior management of the company. Access is available by logging onto the website at www.sempra.com. For those unable to log on to the live webcast, the teleconference will be available on replay a few hours after its conclusion by dialing (888) 203-1112 and entering passcode 2095631.

About Sempra Energy

Sempra Energy's mission is to be North America's premier energy infrastructure company. The Sempra Energy family of companies have more than 19,000 talented employees who deliver energy with purpose to over 36 million consumers. With more than $66 billion in total assets at the end of 2020, the San Diego-based company is the owner of one of the biggest energy networks in North America serving some of the largest economies in the world. The company is helping to advance the global energy transition by enabling the delivery of lower-carbon energy solutions in each market it serves, including California, Texas, Mexico and the LNG export market. Sempra Energy is consistently recognized as a leader in sustainable business practices and for its long-standing commitment to building a high-performing culture and advancing diversity and inclusion. Sempra is the only North American utility sector company included on the Dow Jones Sustainability World Index and was also named one of the "World's Most Admired Companies" for 2021 by Fortune Magazine for the fourth consecutive year.

This press release contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on assumptions with respect to the future, involve risks and uncertainties, and are not guarantees. Future results may differ materially from those expressed in any forward-looking statements. These forward-looking statements represent our estimates and assumptions only as of the date of this press release. We assume no obligation to update or revise any forward-looking statement as a result of new information, future events or other factors.

In this press release, forward-looking statements can be identified by words such as "believes," "expects," "anticipates," "plans," "estimates," "projects," "forecasts," "should," "could," "would," "will," "confident," "may," "can," "potential," "possible," "proposed," "in process," "under construction," "in development," "target," "outlook," "maintain," "continue," or similar expressions, or when we discuss our guidance, priorities, strategy, goals, vision, mission, opportunities, projections, intentions or expectations.

Factors, among others, that could cause actual results and events to differ materially from those described in any forward-looking statements include risks and uncertainties relating to: California wildfires, including the risks that we may be found liable for damages regardless of fault and that we may not be able to recover costs from insurance, the wildfire fund established by California Assembly Bill 1054 or in rates from customers; decisions, investigations, regulations, issuances or revocations of permits and other authorizations, renewals of franchises, and other actions by (i) the Comisión Federal de Electricidad, California Public Utilities Commission (CPUC), U.S. Department of Energy, Public Utility Commission of Texas, and other regulatory and governmental bodies and (ii) states, counties, cities and other jurisdictions in the U.S., Mexico and other countries in which we do business; the success of business development efforts, construction projects and major acquisitions and divestitures, including risks in (i) the ability to make a final investment decision, (ii) completing construction projects or other transactions on schedule and budget, (iii) the ability to realize anticipated benefits from any of these efforts if completed, and (iv) obtaining the consent of partners or other third parties; the resolution of civil and criminal litigation, regulatory inquiries, investigations and proceedings, and arbitrations, including, among others, those related to the natural gas leak at Southern California Gas Company's (SoCalGas) Aliso Canyon natural gas storage facility; the impact of the COVID-19 pandemic on our capital projects, regulatory approval processes, supply chain, liquidity and execution of operations; actions by credit rating agencies to downgrade our credit ratings or to place those ratings on negative outlook and our ability to borrow on favorable terms and meet our substantial debt service obligations; moves to reduce or eliminate reliance on natural gas and the impact of volatility of oil prices on our businesses and development projects; weather, natural disasters, pandemics, accidents, equipment failures, explosions, acts of terrorism, computer system outages and other events that disrupt our operations, damage our facilities and systems, cause the release of harmful materials, cause fires and subject us to liability for property damage or personal injuries, fines and penalties, some of which may not be covered by insurance (including costs in excess of applicable policy limits), may be disputed by insurers or may otherwise not be recoverable through regulatory mechanisms or may impact our ability to obtain satisfactory levels of affordable insurance; the availability of electric power and natural gas and natural gas storage capacity, including disruptions caused by failures in the transmission grid, limitations on the withdrawal of natural gas from storage facilities, and equipment failures; cybersecurity threats to the energy grid, storage and pipeline infrastructure, the information and systems used to operate our businesses, and the confidentiality of our proprietary information and the personal information of our customers and employees; expropriation of assets, failure of foreign governments and state-owned entities to honor their contracts, and property disputes; the impact at San Diego Gas & Electric Company (SDG&E) on competitive customer rates and reliability due to the growth in distributed and local power generation, including from departing retail load resulting from customers transferring to Direct Access and Community Choice Aggregation, and the risk of nonrecovery for stranded assets and contractual obligations; Oncor Electric Delivery Company LLC's (Oncor) ability to eliminate or reduce its quarterly dividends due to regulatory and governance requirements and commitments, including by actions of Oncor's independent directors or a minority member director; volatility in foreign currency exchange and interest rates and commodity prices and our ability to effectively hedge these risks; changes in tax and trade policies, laws and regulations, including tariffs and revisions to international trade agreements that may increase our costs, reduce our competitiveness, or impair our ability to resolve trade disputes; and other uncertainties, some of which may be difficult to predict and are beyond our control.

These risks and uncertainties are further discussed in the reports that Sempra Energy has filed with the U.S. Securities and Exchange Commission (SEC). These reports are available through the EDGAR system free-of-charge on the SEC's website, www.sec.gov, and on the company's website, www.sempra.com. Investors should not rely unduly on any forward-looking statements.

Sempra North American Infrastructure, Sempra LNG, Sempra Mexico, Sempra Texas Utilities, Oncor and Infraestructura Energética Nova, S.A.B. de C.V. (IEnova) are not the same companies as the California utilities, SDG&E or SoCalGas, and Sempra North American Infrastructure, Sempra LNG, Sempra Mexico, Sempra Texas Utilities, Oncor and IEnova are not regulated by the CPUC.

 

SEMPRA ENERGY

Table A

                 

CONSOLIDATED STATEMENTS OF OPERATIONS

(Dollars in millions, except per share amounts; shares in thousands)

   

Three months ended

December 31,

 

Years ended

December 31,

   

2020

 

2019

 

2020

 

2019

   

(unaudited)

       

REVENUES

               

Utilities

 

$

2,826

   

$

2,640

   

$

10,025

   

$

9,448

 

Energy-related businesses

 

345

   

303

   

1,345

   

1,381

 

Total revenues

 

3,171

   

2,943

   

11,370

   

10,829

 
                 

EXPENSES AND OTHER INCOME

               

Utilities:

               

Cost of natural gas

 

(343)

   

(350)

   

(925)

   

(1,139)

 

Cost of electric fuel and purchased power

 

(269)

   

(259)

   

(1,187)

   

(1,188)

 

Energy-related businesses cost of sales

 

(76)

   

(79)

   

(276)

   

(344)

 

Operation and maintenance

 

(1,174)

   

(951)

   

(3,940)

   

(3,466)

 

Aliso Canyon litigation and regulatory matters

 

(180)

   

   

(307)

   

 

Depreciation and amortization

 

(424)

   

(395)

   

(1,666)

   

(1,569)

 

Franchise fees and other taxes

 

(146)

   

(127)

   

(543)

   

(496)

 

Impairment losses

 

   

   

(1)

   

(43)

 

(Loss) gain on sale of assets

 

(3)

   

   

(3)

   

63

 

Other income (expense), net

 

115

   

(26)

   

(48)

   

77

 

Interest income

 

20

   

23

   

96

   

87

 

Interest expense

 

(263)

   

(280)

   

(1,081)

   

(1,077)

 

     Income from continuing operations before income taxes and equity earnings

 

428

   

499

   

1,489

   

1,734

 

Income tax expense

 

(189)

   

(165)

   

(249)

   

(315)

 

Equity earnings

 

193

   

95

   

1,015

   

580

 

Income from continuing operations, net of income tax

 

432

   

429

   

2,255

   

1,999

 

Income from discontinued operations, net of income tax

 

   

71

   

1,850

   

363

 

Net income

 

432

   

500

   

4,105

   

2,362

 

Losses (earnings) attributable to noncontrolling interests

 

29

   

(18)

   

(172)

   

(164)

 

Preferred dividends

 

(47)

   

(35)

   

(168)

   

(142)

 

Preferred dividends of subsidiary

 

   

   

(1)

   

(1)

 

Earnings attributable to common shares

 

$

414

   

$

447

   

$

3,764

   

$

2,055

 
                 

Basic earnings per common share (EPS):

               
                   
                       

Earnings

 

$

1.43

   

$

1.57

   

$

12.93

   

$

7.40

 

Weighted-average common shares outstanding

 

289,009

   

284,649

   

291,077

   

277,904

 
                 

Diluted EPS:

               
                       
                       

Earnings

 

$

1.43

   

$

1.55

   

$

12.88

   

$

7.29

 

Weighted-average common shares outstanding

 

290,216

   

288,767

   

292,252

   

282,033

 

SEMPRA ENERGY

 

Table A (Continued)

 

RECONCILIATION OF SEMPRA ENERGY ADJUSTED EARNINGS TO SEMPRA ENERGY GAAP EARNINGS (Unaudited)

Sempra Energy Adjusted Earnings and Adjusted EPS exclude items (after the effects of income taxes and, if applicable, noncontrolling interests) in 2020 and 2019 as follows:

Three months ended December 31, 2020:

  • $(139) million from impacts associated with Aliso Canyon natural gas storage facility litigation and regulatory matters at Southern California Gas Company (SoCalGas)

Year ended December 31, 2020:

  • $(233) million from impacts associated with Aliso Canyon natural gas storage facility litigation and regulatory matters at SoCalGas
  • $(100) million equity losses at RBS Sempra Commodities LLP, which represent an estimate of our obligations to settle pending tax matters and related legal costs at our equity method investment at Parent and Other
  • $1,747 million gain on the sale of our South American businesses

Year ended December 31, 2019:

  • $45 million gain on the sale of certain Sempra Renewables assets

Associated with holding the South American businesses for sale:

  • $89 million income tax benefit from outside basis differences in our South American businesses primarily related to the change in our indefinite reinvestment assertion from our decision in January 2019 to hold those businesses for sale and a change in the anticipated structure of the sale
  • $10 million income tax benefit to reduce a valuation allowance against certain net operating loss (NOL) carryforwards as a result of our decision to sell our South American businesses

Sempra Energy Adjusted Earnings, Weighted-Average Common Shares Outstanding – Adjusted and Adjusted EPS are non-GAAP financial measures (GAAP represents accounting principles generally accepted in the United States of America). Because of the significance and/or nature of the excluded items, management believes that these non-GAAP financial measures provide a meaningful comparison of the performance of Sempra Energy's business operations to prior and future periods. Non-GAAP financial measures are supplementary information that should be considered in addition to, but not as a substitute for, the information prepared in accordance with GAAP. The table below reconciles for historical periods these non-GAAP financial measures to Sempra Energy GAAP Earnings, Weighted-Average Common Shares Outstanding – GAAP and GAAP EPS, which we consider to be the most directly comparable financial measures calculated in accordance with GAAP.

SEMPRA ENERGY

       

Table A (Continued)

       
                     

RECONCILIATION OF ADJUSTED EARNINGS TO GAAP EARNINGS

(Dollars in millions, except per share amounts; shares in thousands)

   

Pretax amount

Income tax

(benefit)

expense(1)

 

Earnings

 

Pretax amount

Income tax

expense 

  (benefit)(1)

 

Earnings

 

Three months ended December 31, 2020

 

Three months ended December 31, 2019

   

(unaudited)

       

Sempra Energy GAAP Earnings

     

$

414

         

$

447

 

Excluded item:

                 

Impacts associated with Aliso Canyon litigation and regulatory matters

$

180

 

$

(41)

   

139

   

$

 

$

   

 

Sempra Energy Adjusted Earnings

     

$

553

         

$

447

 
                     

Diluted EPS:

                 
                         

Weighted-average common shares outstanding, diluted – GAAP

     

290,216

         

288,787

 

Sempra Energy GAAP EPS

     

$

1.43

         

$

1.55

 

Sempra Energy Adjusted EPS

     

$

1.90

           
                   
   

Year ended December 31, 2020

Year ended December 31, 2019

Sempra Energy GAAP Earnings

     

$

3,764

         

$

2,055

 

Excluded items:

                 

Impacts associated with Aliso Canyon litigation and regulatory matters

$

307

 

$

(74)

   

233

   

$

 

$

   

 

Losses from investment in RBS Sempra Commodities LLP

100

 

   

100

   

 

   

 

Gain on sale of South American businesses

(2,899)

 

1,152

   

(1,747)

   

 

   

 

Gain on sale of certain Sempra Renewables assets

 

   

   

(61)

 

16

   

(45)

 

Associated with holding the South American businesses for sale:

                 

   Change in indefinite reinvestment assertion of basis differences and structure of sale of discontinued operations

 

   

   

 

(89)

   

(89)

 

Reduction in tax valuation allowance against certain NOL carryforwards

 

   

   

 

(10)

   

(10)

 

Sempra Energy Adjusted Earnings

     

$

2,350

         

$

1,911

 
                     

Diluted EPS:

                 

Sempra Energy GAAP Earnings

     

$

3,764

         

$

2,055

 

Weighted-average common shares outstanding, diluted – GAAP

     

292,252

         

282,033

 

Sempra Energy GAAP EPS

     

$

12.88

         

$

7.29

 
                   

Sempra Energy Adjusted Earnings

     

$

2,350

         

$

1,911

 

Add back dividends for dilutive series A preferred stock

     

104

         

 

Sempra Energy Adjusted Earnings for Adjusted EPS

     

$

2,454

         

$

1,911

 

  Weighted-average common shares outstanding, diluted – Adjusted(2)

     

305,669

         

282,033

 

Sempra Energy Adjusted EPS

     

$

8.03

         

$

6.78

 
 

(1)

Except for adjustments that are solely income tax and tax related to outside basis differences, income taxes on pretax amounts were primarily calculated based on applicable statutory tax rates. We did not record an income tax benefit for the equity losses from our investment in RBS Sempra Commodities LLP because, even though a portion of the liabilities may be deductible under United Kingdom tax law, it is not probable that the deduction will reduce United Kingdom taxes.

(2)

In the year ended December 31, 2020, because the assumed conversion of the series A preferred stock is dilutive for Adjusted Earnings, 13,417 series A preferred stock shares are added back to the denominator used to calculate Adjusted EPS.

SEMPRA ENERGY

 

Table A (Continued)

 

RECONCILIATION OF SEMPRA ENERGY 2020 ADJUSTED EPS GUIDANCE RANGE TO SEMPRA ENERGY 2020 GAAP EPS GUIDANCE RANGE (Unaudited)

Sempra Energy 2020 Adjusted EPS Guidance Range of $7.20 to $7.80 excludes items (after the effects of income taxes and, if applicable, noncontrolling interests) as follows:

  • $(233) million from impacts associated with Aliso Canyon natural gas storage facility litigation and regulatory matters at SoCalGas
  • $(100) million equity losses at RBS Sempra Commodities LLP, which represent an estimate of our obligations to settle pending tax matters and related legal costs at our equity method investment at Parent and Other
  • $1,747 million gain on the sale of our South American businesses

Sempra Energy 2020 Adjusted EPS Guidance Range is a non-GAAP financial measure. Because of the significance and/or nature of the excluded items, management believes that this non-GAAP financial measure provides a meaningful comparison of the performance of Sempra Energy's business operations to prior and future periods. Sempra Energy 2020 Adjusted EPS Guidance Range should not be considered an alternative to Sempra Energy 2020 GAAP EPS Guidance Range. Non-GAAP financial measures are supplementary information that should be considered in addition to, but not as a substitute for, the information prepared in accordance with GAAP. The table below reconciles Sempra Energy 2020 Adjusted EPS Guidance Range to Sempra Energy 2020 GAAP EPS Guidance Range, which we consider to be the most directly comparable financial measure calculated in accordance with GAAP.

RECONCILIATION OF ADJUSTED EPS GUIDANCE RANGE TO GAAP EPS GUIDANCE RANGE

 
     

Full-Year 2020

Sempra Energy GAAP EPS Guidance Range(1)

$

12.02

 

to

$

12.62

 

Excluded items:

     
 

Impacts associated with Aliso Canyon litigation and regulatory matters

0.80

   

0.80

 
 

Losses from investment in RBS Sempra Commodities LLP

0.34

   

0.34

 
 

Gain on sale of South American businesses

(5.96)

   

(5.96)

 

Sempra Energy Adjusted EPS Guidance Range

$

7.20

 

to

$

7.80

 

Weighted-average common shares outstanding, diluted (millions)(2)

   

293

 
 

(1)

Sempra Energy's prior GAAP EPS Guidance Range for full-year 2020 has been updated to reflect additional impacts associated with the Aliso Canyon natural gas storage facility litigation and regulatory matters.

(2)

Weighted-average common shares outstanding does not include the dilutive effect of mandatory convertible preferred stock, as they are assumed to be antidilutive for full-year 2020. If such mandatory convertible preferred stock were dilutive for the full year, the 2020 GAAP EPS Guidance Range would differ from the range presented above.

 

SEMPRA ENERGY

 

Table B

 
         

CONSOLIDATED BALANCE SHEETS

 

(Dollars in millions)

       
   

December 31,

   

2020

 

2019

ASSETS

       

Current assets:

       

Cash and cash equivalents

 

$

960

   

$

108

 

Restricted cash

 

22

   

31

 

Accounts receivable – trade, net

 

1,578

   

1,261

 

Accounts receivable – other, net

 

403

   

455

 

Due from unconsolidated affiliates

 

20

   

32

 

Income taxes receivable

 

113

   

112

 

Inventories

 

308

   

277

 

Regulatory assets

 

190

   

222

 

Greenhouse gas allowances

 

553

   

72

 

Assets held for sale in discontinued operations

 

   

445

 

Other current assets

 

364

   

324

 

Total current assets

 

4,511

   

3,339

 
         

Other assets:

       

Restricted cash

 

3

   

3

 

Due from unconsolidated affiliates

 

780

   

742

 

Regulatory assets

 

1,822

   

1,930

 

Nuclear decommissioning trusts

 

1,019

   

1,082

 

Investment in Oncor Holdings

 

12,440

   

11,519

 

Other investments

 

1,388

   

2,103

 

Goodwill

 

1,602

   

1,602

 

Other intangible assets

 

202

   

213

 

Dedicated assets in support of certain benefit plans

 

512

   

488

 

Insurance receivable for Aliso Canyon costs

 

445

   

339

 

Deferred income taxes

 

136

   

155

 

Greenhouse gas allowances

 

101

   

470

 

Right-of-use assets – operating leases

 

543

   

591

 

Wildfire fund

 

363

   

392

 

Assets held for sale in discontinued operations

 

   

3,513

 

Other long-term assets

 

753

   

732

 

Total other assets

 

22,109

   

25,874

 

Property, plant and equipment, net

 

40,003

   

36,452

 

Total assets

 

$

66,623

   

$

65,665

 

 

SEMPRA ENERGY

 

Table B (Continued)

 
         

CONSOLIDATED BALANCE SHEETS (CONTINUED)

 

(Dollars in millions)

       
   

December 31,

   

2020

 

2019

LIABILITIES AND EQUITY

       

Current liabilities:

       

Short-term debt

 

$

885

   

$

3,505

 

Accounts payable – trade

 

1,359

   

1,234

 

Accounts payable – other

 

154

   

179

 

Due to unconsolidated affiliates

 

45

   

5

 

Dividends and interest payable

 

551

   

515

 

Accrued compensation and benefits

 

446

   

476

 

Regulatory liabilities

 

140

   

319

 

Current portion of long-term debt and finance leases

 

1,540

   

1,526

 

Reserve for Aliso Canyon costs

 

150

   

9

 

Greenhouse gas obligations

 

553

   

72

 

Liabilities held for sale in discontinued operations

 

   

444

 

Other current liabilities

 

1,016

   

866

 

Total current liabilities

 

6,839

   

9,150

 
         

Long-term debt and finance leases

 

21,781

   

20,785

 
         

Deferred credits and other liabilities:

       

Due to unconsolidated affiliates

 

234

   

195

 

Pension and other postretirement benefit plan
obligations, net of plan assets

 

1,059

   

1,067

 

Deferred income taxes

 

2,871

   

2,577

 
         

Regulatory liabilities

 

3,372

   

3,741

 

Reserve for Aliso Canyon costs

 

301

   

7

 

Asset retirement obligations

 

3,113

   

2,923

 

Greenhouse gas obligations

 

   

301

 

Liabilities held for sale in discontinued operations

 

   

1,052

 

Deferred credits and other

 

2,119

   

2,062

 

Total deferred credits and other liabilities

 

13,069

   

13,925

 

Equity:

       

Sempra Energy shareholders' equity

 

23,373

   

19,929

 

Preferred stock of subsidiary

 

20

   

20

 

Other noncontrolling interests

 

1,541

   

1,856

 

Total equity

 

24,934

   

21,805

 

Total liabilities and equity

 

$

66,623

   

$

65,665

 

 

SEMPRA ENERGY

Table C

       

CONSOLIDATED STATEMENTS OF CASH FLOWS

     

(Dollars in millions)

     
 

Years ended December 31,

 

2020

 

2019

CASH FLOWS FROM OPERATING ACTIVITIES

     

Net income

$

4,105

   

$

2,362

 

Less: Income from discontinued operations, net of income tax

(1,850)

   

(363)

 

Income from continuing operations, net of income tax

2,255

   

1,999

 

Adjustments to reconcile net income to net cash provided by operating activities

1,042

   

1,259

 

Net change in other working capital components

(550)

   

(207)

 

Distributions from investments

651

   

247

 

Insurance receivable for Aliso Canyon costs

(106)

   

122

 

Wildfire fund, current and noncurrent

   

(323)

 

Reserve for Aliso Canyon costs, noncurrent

294

   

 

Changes in other noncurrent assets and liabilities, net

56

   

(399)

 

Net cash provided by continuing operations

3,642

   

2,698

 

Net cash (used in) provided by discontinued operations

(1,051)

   

390

 

Net cash provided by operating activities

2,591

   

3,088

 
       

CASH FLOWS FROM INVESTING ACTIVITIES

     

Expenditures for property, plant and equipment

(4,676)

   

(3,708)

 

Expenditures for investments and acquisitions

(652)

   

(1,797)

 

Proceeds from sale of assets

19

   

899

 

Distributions from investments

761

   

9

 

Purchases of nuclear decommissioning trust assets

(1,439)

   

(914)

 

Proceeds from sales of nuclear decommissioning trust assets

1,439

   

914

 

Advances to unconsolidated affiliates

(92)

   

(16)

 

Repayments of advances to unconsolidated affiliates

7

   

3

 

Intercompany activities with discontinued operations, net

   

8

 

Other

15

   

21

 

Net cash used in continuing operations

(4,618)

   

(4,581)

 

Net cash provided by (used in) discontinued operations

5,171

   

(12)

 

Net cash provided by (used in) investing activities

553

   

(4,593)

 
       

CASH FLOWS FROM FINANCING ACTIVITIES

     

Common dividends paid

(1,174)

   

(993)

 

Preferred dividends paid

(157)

   

(142)

 

Issuances of preferred stock, net

891

   

 

Issuances of common stock, net

11

   

1,830

 

Repurchases of common stock

(566)

   

(26)

 

Issuances of debt (maturities greater than 90 days)

6,051

   

4,296

 

Payments on debt (maturities greater than 90 days) and finance leases

(5,864)

   

(3,667)

 

(Decrease) increase in short-term debt, net

(1,759)

   

656

 

Advances from unconsolidated affiliates

64

   

155

 

Proceeds from sale of noncontrolling interests, net

26

   

5

 

Purchases of noncontrolling interests

(248)

   

(30)

 

Contributions from noncontrolling interests, net

1

   

98

 

Intercompany activities with discontinued operations, net

   

(266)

 

Other

(50)

   

(49)

 

Net cash (used in) provided by continuing operations

(2,774)

   

1,867

 

Net cash provided by (used in) discontinued operations

401

   

(392)

 

Net cash (used in) provided by financing activities

(2,373)

   

1,475

 
       

Effect of exchange rate changes in continuing operations

   

 

Effect of exchange rate changes in discontinued operations

(3)

   

1

 

Effect of exchange rate changes on cash, cash equivalents and restricted cash

(3)

   

1

 
       

Increase (decrease) in cash, cash equivalents and restricted cash, including discontinued operations

768

   

(29)

 

Cash, cash equivalents and restricted cash, including discontinued operations, January 1

217

   

246

 

Cash, cash equivalents and restricted cash, including discontinued operations, December 31

$

985

   

$

217

 

 

SEMPRA ENERGY

Table D

               

SEGMENT EARNINGS (LOSSES) AND CAPITAL EXPENDITURES, INVESTMENTS AND ACQUISITIONS

(Dollars in millions)

             
 

Three months ended

December 31,

 

Years ended

December 31,

 

2020

 

2019

 

2020

 

2019

 

    (unaudited)

       

Earnings (Losses) Attributable to Common Shares

             

SDG&E

$

191

   

$

185

   

$

824

   

$

767

 

SoCalGas

79

   

204

   

504

   

641

 

Sempra Texas Utilities

121

   

109

   

579

   

528

 

Sempra Mexico

(43)

   

39

   

259

   

253

 

Sempra LNG

113

   

(19)

   

320

   

(6)

 

Sempra Renewables

   

   

   

59

 

Parent and other

(47)

   

(132)

   

(562)

   

(515)

 

Discontinued operations

   

61

   

1,840

   

328

 

Total

$

414

   

$

447

   

$

3,764

   

$

2,055

 
               
               
 

Three months ended

December 31,

 

Years ended

December 31,

 

2020

 

2019

 

2020

 

2019

 

    (unaudited)

       

Capital Expenditures, Investments and Acquisitions

             

SDG&E

$

619

   

$

451

   

$

1,942

   

$

1,522

 

SoCalGas

498

   

420

   

1,843

   

1,439

 

Sempra Texas Utilities

423

   

347

   

648

   

1,685

 

Sempra Mexico

168

   

204

   

611

   

624

 

Sempra LNG

72

   

39

   

272

   

222

 

Sempra Renewables

   

   

   

2

 

Parent and other

6

   

5

   

12

   

11

 

Total

$

1,786

   

$

1,466

   

$

5,328

   

$

5,505

 

 

SEMPRA ENERGY

Table D (Continued)

           

RECONCILIATION OF CAPITAL DEPLOYED

       

(Dollars in millions)

       
     

Years ended December 31,

     

2020

 

2019

     

(unaudited)

Sempra Energy

       

Expenditures for property, plant and equipment

 

$

4,676

   

$

3,708

 

Expenditures for investments and acquisitions

 

652

   

1,797

 

Total Capital Expenditures, Investments and Acquisitions (On Balance Sheet)

 

5,328

   

5,505

 

Exclude:

       

     Capital contribution to Oncor for Oncor's acquisition of 100% of InfraREIT and Sempra's acquisition of a 50%

          indirect interest in Sharyland

 

   

(1,162)

 

  Acquisition of 1% interest in Texas Transmission Holdings Corporation (TTHC) from Hunt

 

(16)

   

 

  Total Capital Expenditures and Investments (On Balance Sheet)

A

5,312

   

4,343

 
           

Oncor Electric Delivery Company LLC

 

Capital expenditures (100%)

 

2,540

   

2,097

 

Total Capital Expenditures (Off Balance Sheet)

 

2,540

   

2,097

 
           

Sharyland Utilities

 

Capital expenditures (100%)

 

5

   

2

 

Total Capital Expenditures (Off Balance Sheet)

 

5

   

2

 
         

Sempra Texas Utilities - Proportionate Ownership Share of Unconsolidated Entities

 

80.25% of Oncor Electric Delivery Company LLC capital expenditures

 

2,038

   

1,683

 

50% of Sharyland Utilities capital expenditures

 

3

   

1

 

Less:

       

Sempra Texas Utilities investments and acquisitions (On Balance Sheet)

 

(648)

   

(1,685)

 

Add Back:

       

     Sempra Texas Utilities acquisitions (On Balance Sheet)(1)

 

16

   

1,162

 

Capital Expenditures, Investments and Acquisitions - Sempra Texas Utilities (Off Balance Sheet)

 

1,409

   

1,161

 
           

Capital Expenditures - Unconsolidated Joint Ventures at Sempra LNG and Sempra Mexico (Off Balance Sheet)(2)

 

228

   

446

 
           

Total Capital Expenditures, Investments and Acquisitions of Unconsolidated Entities (Off Balance Sheet)

B

1,637

   

1,607

 
           

Total Capital Deployed

A+B

$

6,949

   

$

5,950

 
 

(1)

Includes Sempra Energy's acquisition of 1% interest in TTHC from Hunt in 2020 and Sempra Energy's capital contribution to Oncor for Oncor's acquisition of 100% of InfraREIT and Sempra Energy's acquisition of a 50% indirect interest in Sharyland in 2019.

(2)

Amounts are net of capital contributions from Sempra Energy. 2020 and 2019 includes $146 and $337, respectively, of capex funded by Sempra LNG's unconsolidated JV (Cameron LNG JV) and $82 and $109, respectively, funded by Sempra Mexico's unconsolidated JVs.

 

SEMPRA ENERGY

Table E

         

OTHER OPERATING STATISTICS

 
   

Three months ended

December 31,

 

Years ended or at

December 31,

   

2020

 

2019

 

2020

 

2019

   

(unaudited)

UTILITIES

             

SDG&E and SoCalGas

             

   Gas sales (Bcf)(1)

98

 

103

 

355

 

374

   Transportation (Bcf)(1)

161

 

149

 

612

 

573

   Total deliveries (Bcf)(1)

259

 

252

 

967

 

947

               

   Total gas customer meters (thousands)

       

6,967

 

6,924

               

SDG&E

             

   Electric sales (millions of kWhs)(1)

3,751

 

3,601

 

14,398

 

14,397

  Direct Access and Community Choice Aggregation (millions of kWhs)

952

 

909

 

3,482

 

3,549

   Total deliveries (millions of kWhs)(1)

4,703

 

4,510

 

17,880

 

17,946

               

   Total electric customer meters (thousands)

       

1,483

 

1,471

               

Oncor(2)

             

   Total deliveries (millions of kWhs)

30,615

 

30,916

 

131,157

 

133,378

   Total electric customer meters (thousands)

       

3,762

 

3,685

               

Ecogas

             

   Natural gas sales (Bcf)

1

 

1

 

3

 

3

   Natural gas customer meters (thousands)

       

136

 

132

                 

ENERGY-RELATED BUSINESSES

             

Power generated and sold

             

   Sempra Mexico

             

  Termoeléctrica de Mexicali (TdM) (millions of kWhs)

729

 

1,011

 

2,905

 

3,873

     Wind and solar (millions of kWhs)(3)

420

 

333

 

1,724

 

1,442

 

(1)

Includes intercompany sales.

(2)

Includes 100% of the electric deliveries and customer meters of Oncor Electric Delivery Company LLC (Oncor), in which we hold an indirect 80.25% interest through our investment in Oncor Electric Delivery Holdings Company LLC.

(3)

Includes 50% of the total power generated and sold at the Energía Sierra Juárez wind power generation facility, in which Sempra Energy has a 50% ownership interest.

 

SEMPRA ENERGY

           

Table F (Unaudited)

           
                                   

STATEMENT OF OPERATIONS DATA BY SEGMENT

           

(Dollars in millions)

           
                                 

Three months ended December 31, 2020

SDG&E

 

SoCalGas

 

Sempra

Texas

Utilities

 

Sempra

Mexico

     

Sempra LNG

 

Consolidating

Adjustments,

Parent &

Other

   

Total

Revenues

$

1,337

   

$

1,501

   

$

   

$

321

       

$

119

   

$

(107)

     

$

3,171

 

Cost of sales and other expenses

(813)

   

(1,165)

   

   

(173)

       

(118)

   

81

     

(2,188)

 

Depreciation and amortization

(203)

   

(168)

   

   

(48)

       

(2)

   

(3)

     

(424)

 
                                       

Loss on sale of assets

   

   

   

       

   

(3)

     

(3)

 

Other income (expense), net

5

   

(49)

   

   

134

       

   

25

     

115

 

Income (loss) before interest and tax(1)

326

   

119

   

   

234

       

(1)

   

(7)

     

671

 

Net interest (expense) income

(106)

   

(39)

   

   

(24)

       

12

   

(86)

     

(243)

 

Income tax (expense) benefit

(29)

   

(1)

   

(1)

   

(218)

       

(33)

   

93

     

(189)

 

Equity earnings (losses), net

   

   

122

   

(63)

       

134

   

     

193

 

Losses attributable to noncontrolling interests

   

   

   

28

       

1

   

     

29

 

Preferred dividends

   

   

   

       

   

(47)

     

(47)

 

Earnings (losses) attributable to common shares

$

191

   

$

79

   

$

121

   

$

(43)

       

$

113

   

$

(47)

     

$

414

 
                                       
                                   
                                 

Three months ended December 31, 2019

SDG&E

 

SoCalGas

 

Sempra

Texas

Utilities

 

Sempra

Mexico

     

Sempra LNG

 

Consolidating

Adjustments,

Parent &

Other

   

Total

Revenues

$

1,259

   

$

1,383

   

$

   

$

317

       

$

83

   

$

(99)

     

$

2,943

 

Cost of sales and other expenses

(705)

   

(847)

   

   

(153)

       

(112)

   

51

     

(1,766)

 

Depreciation and amortization

(189)

   

(153)

   

   

(47)

       

(3)

   

(3)

     

(395)

 
                                       
                                       

Other (expense) income, net

(21)

   

(73)

   

   

70

       

   

(2)

     

(26)

 

Income (loss) before interest and tax(1)

344

   

310

   

   

187

       

(32)

   

(53)

     

756

 

Net interest expense

(99)

   

(36)

   

   

(10)

       

(1)

   

(111)

     

(257)

 

Income tax (expense) benefit

(60)

   

(70)

   

   

(111)

       

9

   

67

     

(165)

 

Equity earnings (losses), net

   

   

109

   

(19)

       

5

   

     

95

 

Earnings attributable to noncontrolling interests

   

   

   

(8)

       

   

     

(8)

 

Preferred dividends

   

   

   

       

   

(35)

     

(35)

 

Earnings (losses) from continuing operations

$

185

   

$

204

   

$

109

   

$

39

       

$

(19)

   

$

(132)

     

386

 

Earnings from discontinued operations

                             

61

 

Earnings attributable to common shares

                             

$

447

 
 

(1)

Management believes Income (Loss) Before Interest and Tax is a useful measurement of our segments' performance because it can be used to evaluate the effectiveness of our operations exclusive of interest and income tax, neither of which is directly relevant to the efficiency of those operations.

 

SEMPRA ENERGY

Table F

                                   

STATEMENT OF OPERATIONS DATA BY SEGMENT

(Dollars in millions)

                                 

Year ended December 31, 2020

SDG&E

 

SoCalGas

 

Sempra

Texas

Utilities

 

Sempra

Mexico

 

Sempra LNG

 

Sempra

Renewables

 

Consolidating

Adjustments,

Parent &

Other

   

Total

Revenues

$

5,313

   

$

4,748

   

$

   

$

1,256

   

$

374

   

$

   

$

(321)

     

$

11,370

 

Cost of sales and other expenses

(3,139)

   

(3,309)

   

   

(581)

   

(384)

   

   

234

     

(7,179)

 

Depreciation and amortization

(801)

   

(654)

   

   

(189)

   

(9)

   

   

(13)

     

(1,666)

 
                                       

Loss on sale of assets

   

   

   

   

   

   

(3)

     

(3)

 

Other income (expense), net

52

   

(28)

   

   

(77)

   

   

   

5

     

(48)

 

Income (loss) before interest and tax(1)

1,425

   

757

   

   

409

   

(19)

   

   

(98)

     

2,474

 

Net interest (expense) income

(411)

   

(156)

   

   

(72)

   

38

   

   

(384)

     

(985)

 

Income tax (expense) benefit

(190)

   

(96)

   

(1)

   

(57)

   

(92)

   

   

187

     

(249)

 

Equity earnings (losses), net

   

   

580

   

144

   

391

   

   

(100)

     

1,015

 

(Earnings) losses attributable to noncontrolling interests

   

   

   

(165)

   

2

   

   

1

     

(162)

 

Preferred dividends

   

(1)

   

   

   

   

   

(168)

     

(169)

 

Earnings (losses) from continuing operations

$

824

   

$

504

   

$

579

   

$

259

   

$

320

   

$

   

$

(562)

     

1,924

 

Earnings from discontinued operations

                             

1,840

 

Earnings attributable to common shares

                             

$

3,764

 
                                 
                                 

Year ended December 31, 2019

SDG&E

 

SoCalGas

 

Sempra

Texas

Utilities

 

Sempra

Mexico

 

Sempra LNG

 

Sempra

Renewables

 

Consolidating

Adjustments,

Parent &

Other

   

Total

Revenues

$

4,925

   

$

4,525

   

$

   

$

1,375

   

$

410

   

$

10

   

$

(416)

     

$

10,829

 

Cost of sales and other expenses

(2,846)

   

(2,930)

   

   

(649)

   

(462)

   

(20)

   

274

     

(6,633)

 

Depreciation and amortization

(760)

   

(602)

   

   

(183)

   

(10)

   

   

(14)

     

(1,569)

 

Impairment losses

(6)

   

(37)

   

   

   

   

   

     

(43)

 

Gain on sale of assets

   

   

   

   

   

61

   

2

     

63

 

Other income (expense), net

39

   

(55)

   

   

76

   

   

   

17

     

77

 

Income (loss) before interest and tax(1)

1,352

   

901

   

   

619

   

(62)

   

51

   

(137)

     

2,724

 

Net interest (expense) income

(407)

   

(139)

   

   

(41)

   

26

   

8

   

(437)

     

(990)

 

Income tax (expense) benefit

(171)

   

(120)

   

   

(227)

   

5

   

(4)

   

202

     

(315)

 

Equity earnings (losses), net

   

   

528

   

24

   

24

   

5

   

(1)

     

580

 

(Earnings) losses attributable to noncontrolling interests

(7)

   

   

   

(122)

   

1

   

(1)

   

     

(129)

 

Preferred dividends

   

(1)

   

   

   

   

   

(142)

     

(143)

 

Earnings (losses) from continuing operations

$

767

   

$

641

   

$

528

   

$

253

   

$

(6)

   

$

59

   

$

(515)

     

1,727

 

Earnings from discontinued operations

                             

328

 

Earnings attributable to common shares

                             

$

2,055

 
 

(1)

Management believes Income (Loss) Before Interest and Tax is a useful measurement of our segments' performance because it can be used to evaluate the effectiveness of our operations exclusive of interest and income tax, neither of which is directly relevant to the efficiency of those operations.

 

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SOURCE Sempra Energy

Category

Sempra Energy , Financial News , Sempra LNG