- Second Quarter 2022 GAAP earnings per share of $0.63; Core EPS
of $0.94
- Installed more than 3,500 circuit miles of covered conductor
to-date, just 3.5 years after initiating program
- Reaffirms 2022 EPS guidance of $4.40–4.70. Also reiterates
long-term EPS growth rate target of 5–7%
Edison International (NYSE: EIX) today reported second quarter
2022 net income of $241 million, or $0.63 per share, compared to
net income of $318 million, or $0.84 per share, in the second
quarter of 2021. As adjusted, second quarter 2022 core earnings
were $357 million, or $0.94 per share, compared to core earnings of
$356 million, or $0.94 per share, in the second quarter of
2021.
Southern California Edison’s (SCE) second quarter 2022 core
earnings per share (EPS) increased year-over-year, primarily due to
the adoption of the 2021 General Rate Case final decision in the
third quarter of 2021, partially offset by higher operation and
maintenance expenses.
Edison International Parent and Other's second quarter 2022 loss
per share increased year-over-year primarily due to higher
preferred dividends and unrealized losses on investment in 2022
compared to unrealized gains in 2021.
“SCE has made tremendous progress in wildfire mitigation,
achieving a significant grid hardening milestone of replacing over
3,500 circuit miles of bare wire with covered conductor in just
over three and a half years,” said Pedro J. Pizarro, president and
CEO of Edison International. “Further, the utility plans to
continue its current pace of installing about 1,200 miles per year
of covered conductor for the next couple of years. I am confident
that SCE’s covered conductor program has and will continue to
substantially improve safety for customers.”
Pizarro added, “Investing in wildfire risk mitigation is a core
component in adapting to climate change. We also have a continuing
focus on sustainability, since this underlies the company’s
strategy. I’m proud of the meaningful progress we make every year
to advance our clean energy strategy and provide value to our
stakeholders. One highlight is that SCE has the lowest system
average rate among the large California IOUs, primarily due to more
than a decade of committed focus on operational excellence and cost
management.”
Edison International uses core earnings, which is a non-GAAP
financial measure that adjusts for significant discrete items that
management does not consider representative of ongoing earnings.
Edison International management believes that core earnings provide
more meaningful comparisons of performance from period to period.
Please see the attached tables for a reconciliation of core
earnings to basic GAAP earnings.
2022 Earnings Guidance
The company reaffirmed its earnings guidance range for 2022 as
summarized in the following chart. See the presentation
accompanying the company’s conference call for further information
and assumptions.
2022 Earnings Guidance
2022 Earnings Guidance
as of May 3, 2022
as of July 28, 2022
Low
High
Low
High
EIX Basic EPS
$
3.55
$
3.85
$
3.25
$
3.55
Less: Non-core Items*
(0.85
)
(0.85
)
(1.15
)
(1.15
)
EIX Core EPS
$
4.40
$
4.70
$
4.40
$
4.70
* There were ($439) million, or ($1.15)
per share of non-core items recorded for the six months ended June
30, 2022, calculated based on an assumed weighted average share
count for 2022. Basic EIX EPS guidance only incorporates non-core
items to June 30, 2022.
Second Quarter 2022 Earnings
Conference Call and Webcast Details
When:
Thursday, July 28, 2022, 1:30 – 2:30 p.m.
(Pacific Time)
Telephone Numbers:
1-888-673-9780 (US) and 1-312-470-0178
(Int'l) - Passcode: Edison
Telephone Replay:
1-866-430-4723 (US) and 1-203-369-0925
(Int’l) - Passcode: 4276
Telephone replay available through August
12, 2022 at 6:00 p.m. (Pacific Time)
Webcast:
www.edisoninvestor.com
Edison International has posted its earnings conference call
prepared remarks by the CEO and CFO, the teleconference
presentation, and Form 10-Q to the company's investor relations
website. These materials are available at
www.edisoninvestor.com.
About Edison
International
Edison International (NYSE: EIX) is one of the nation’s largest
electric utility holding companies, providing clean and reliable
energy and energy services through its independent companies.
Headquartered in Rosemead, California, Edison International is the
parent company of Southern California Edison Company, a utility
that delivers electricity to 15 million people across Southern,
Central and Coastal California. Edison International is also the
parent company of Edison Energy LLC, a global energy advisory firm
engaged in the business of providing integrated decarbonization and
energy solutions to commercial, industrial and institutional
customers.
Appendix
Use of Non-GAAP Financial
Measures
Edison International’s earnings are prepared in accordance with
generally accepted accounting principles used in the United States
and represent the company’s earnings as reported to the Securities
and Exchange Commission. Our management uses core earnings and core
earnings per share (EPS) internally for financial planning and for
analysis of performance of Edison International and Southern
California Edison. We also use core earnings and core EPS when
communicating with analysts and investors regarding our earnings
results to facilitate comparisons of the Company’s performance from
period to period. Financial measures referred to as net income,
basic EPS, core earnings, or core EPS also apply to the description
of earnings or earnings per share.
Core earnings and core EPS are non-GAAP financial measures and
may not be comparable to those of other companies. Core earnings
and core EPS are defined as basic earnings and basic EPS excluding
income or loss from discontinued operations and income or loss from
significant discrete items that management does not consider
representative of ongoing earnings. Basic earnings and losses refer
to net income or losses attributable to Edison International
shareholders. Core earnings are reconciled to basic earnings in the
attached tables. The impact of participating securities (vested
awards that earn dividend equivalents that may participate in
undistributed earnings with common stock) for the principal
operating subsidiary is not material to the principal operating
subsidiary’s EPS and is therefore reflected in the results of the
Edison International holding company, which is included in Edison
International Parent and Other.
Safe Harbor Statement
Statements contained in this release about future performance,
including, without limitation, operating results, capital
expenditures, rate base growth, dividend policy, financial outlook,
and other statements that are not purely historical, are
forward-looking statements. These forward-looking statements
reflect our current expectations; however, such statements involve
risks and uncertainties. Actual results could differ materially
from current expectations. These forward-looking statements
represent our expectations only as of the date of this release, and
Edison International assumes no duty to update them to reflect new
information, events or circumstances. Important factors that could
cause different results include, but are not limited to the:
- ability of SCE to recover its costs through regulated rates,
including uninsured wildfire-related and debris flow-related costs,
costs incurred to mitigate the risk of utility equipment causing
future wildfires, costs incurred as a result of the COVID-19
pandemic, and increased labor and materials costs due to supply
chain constraints and inflation;
- ability of SCE to implement its Wildfire Mitigation Plan and
capital program;
- risks of regulatory or legislative restrictions that would
limit SCE's ability to implement Public Safety Power Shutoff
("PSPS") when conditions warrant or would otherwise limit SCE's
operational PSPS practices;
- risks associated with implementing PSPS, including regulatory
fines and penalties, claims for damages and reputational harm;
- ability of SCE to maintain a valid safety certification;
- ability to obtain sufficient insurance at a reasonable cost,
including insurance relating to wildfire-related claims, and to
recover the costs of such insurance or, in the event liabilities
exceed insured amounts, the ability to recover uninsured losses
from customers or other parties;
- extreme weather-related incidents (including events caused, or
exacerbated, by climate change, such as wildfires, debris flows,
droughts, high wind events and extreme heat events) and other
natural disasters (such as earthquakes), which could cause, among
other things, public safety issues, property damage, operational
issues (such as rotating outages and issues due to damaged
infrastructure), PSPS activations and unanticipated costs;
- risk that California Assembly Bill 1054 ("AB 1054") does not
effectively mitigate the significant exposure faced by California
investor-owned utilities related to liability for damages arising
from catastrophic wildfires where utility facilities are alleged to
be a substantial cause, including the longevity of the Wildfire
Insurance Fund and the CPUC's interpretation of and actions under
AB 1054, including its interpretation of the prudency standard
established under AB 1054;
- ability of Edison International and SCE to effectively attract,
manage, develop and retain a skilled workforce, including its
contract workers;
- decisions and other actions by the California Public Utilities
Commission, the Federal Energy Regulatory Commission, the Nuclear
Regulatory Commission and other governmental authorities, including
decisions and actions related to nationwide or statewide crisis,
determinations of authorized rates of return or return on equity,
the recoverability of wildfire-related and debris flow-related
costs, issuance of SCE's wildfire safety certification, wildfire
mitigation efforts, approval and implementation of electrification
programs, and delays in executive, regulatory and legislative
actions;
- cost and availability of labor, equipment and materials,
including as a result of supply chain constraints;
- ability of Edison International or SCE to borrow funds and
access bank and capital markets on reasonable terms;
- risks associated with the decommissioning of San Onofre,
including those related to worker and public safety, public
opposition, permitting, governmental approvals, on-site storage of
spent nuclear fuel and other radioactive material, delays,
contractual disputes, and cost overruns;
- pandemics, such as COVID-19, and other events that cause
regional, statewide, national or global disruption, which could
impact, among other things, Edison International's and SCE's
business, operations, cash flows, liquidity and/or financial
results and cause Edison International and SCE to incur
unanticipated costs;
- physical security of Edison International's and SCE's critical
assets and personnel and the cybersecurity of Edison
International's and SCE's critical information technology systems
for grid control, and business, employee and customer data;
- risks associated with cost allocation resulting in higher rates
for utility bundled service customers because of possible customer
bypass or departure for other electricity providers such as
Community Choice Aggregators ("CCA," which are cities, counties,
and certain other public agencies with the authority to generate
and/or purchase electricity for their local residents and
businesses) and Electric Service Providers (entities that offer
electric power and ancillary services to retail customers, other
than electrical corporations (like SCE) and CCAs);
- risks inherent in SCE's capital investment program, including
those related to project site identification, public opposition,
environmental mitigation, construction, permitting, changes in the
California Independent System Operator's transmission plans, and
governmental approvals; and
- risks associated with the operation of electrical facilities,
including worker and public safety issues, the risk of utility
assets causing or contributing to wildfires, failure, availability,
efficiency, and output of equipment and facilities, and
availability and cost of spare parts.
Additional information about risks and uncertainties is
contained in Edison International and SCE’s most recent combined
Form 10-Q and Form 10-K filed with the Securities and Exchange
Commission, including the "Risk Factors" sections. Readers are
urged to read this entire release as well as the most recent Form
10-Q and Form 10-K (including information incorporated by
reference), and carefully consider the risks, uncertainties, and
other factors that affect Edison International's and SCE's
businesses. Edison International and SCE post or provide direct
links (i) to certain SCE and other parties' regulatory filings and
documents with the CPUC and the FERC and certain agency rulings and
notices in open proceedings in a section titled "SCE Regulatory
Highlights," (ii) to certain documents and information related to
Southern California wildfires which may be of interest to investors
in a section titled "Southern California Wildfires," and (iii) to
presentations, documents and other information that may be of
interest to investors in a section titled "Presentations and
Updates" at www.edisoninvestor.com in order to publicly disseminate
such information.
These forward-looking statements represent our expectations only
as of the date of this news release, and Edison International
assumes no duty to update them to reflect new information, events
or circumstances. Readers should review future reports filed by
Edison International and SCE with the SEC.
Second Quarter Reconciliation of Basic
Earnings Per Share to Core Earnings Per Share
Three months ended
Six months ended
June 30,
June 30,
2022
2021
Change
2022
2021
Change
Earnings (loss) per share attributable to
Edison International
SCE
$
0.79
$
0.95
$
(0.16
)
$
1.18
$
1.73
$
(0.55
)
Edison International Parent and Other
(0.16
)
(0.11
)
(0.05
)
(0.33
)
(0.21
)
(0.12
)
Edison International
0.63
0.84
(0.21
)
0.85
1.52
(0.67
)
Less: Non-core items
SCE
(0.31
)
(0.10
)
(0.21
)
(1.15
)
(0.21
)
(0.94
)
Edison International Parent and Other
—
—
—
—
—
—
Total non-core items
(0.31
)
(0.10
)
(0.21
)
(1.15
)
(0.21
)
(0.94
)
Core earnings (losses)
SCE
1.10
1.05
0.05
2.33
1.94
0.39
Edison International Parent and Other
(0.16
)
(0.11
)
(0.05
)
(0.33
)
(0.21
)
(0.12
)
Edison International
$
0.94
$
0.94
$
—
$
2.00
$
1.73
$
0.27
Note: Diluted earnings were $0.63 and
$0.84 per share for the three months ended June 30, 2022 and 2021,
respectively. Diluted earnings were $0.85 and $1.52 per share for
the six months ended June 30, 2022 and 2021, respectively.
Second Quarter Reconciliation of Basic
Earnings Per Share to Core Earnings (in millions)
Three months ended
Six months ended
June 30,
June 30,
(in millions)
2022
2021
Change
2022
2021
Change
Net income (loss) attributable to Edison
International
SCE
$
302
$
359
$
(57
)
$
449
$
655
$
(206
)
Edison International Parent and Other
(61
)
(41
)
(20
)
(124
)
(78
)
(46
)
Edison International
241
318
(77
)
325
577
(252
)
Less: Non-core items
SCE1,2,3,4,5,6,7
(116
)
(38
)
(78
)
(439
)
(80
)
(359
)
Edison International Parent and Other
—
—
—
—
—
—
Total non-core items
(116
)
(38
)
(78
)
(439
)
(80
)
(359
)
Core earnings (losses)
SCE
418
397
21
888
735
153
Edison International Parent and Other
(61
)
(41
)
(20
)
(124
)
(78
)
(46
)
Edison International
$
357
$
356
$
1
$
764
$
657
$
107
1
Includes amortization of SCE’s Wildfire
Insurance Fund expenses of $53 million ($38 million after tax) and
$54 million ($39 million after tax) for the three months ended June
30, 2022 and 2021, respectively. It also includes $106 million ($76
million after tax) and $107 million ($77 million after tax) for the
six months ended June 30, 2022 and 2021, respectively.
2
Includes charges for 2017/2018
Wildfire/Mudslide Events claims and expenses, net of recoveries of
$8 million ($6 million after tax) and $9 million ($6 million after
tax) recorded for the three months ended June 30, 2022 and 2021,
respectively. Includes charges of $404 million ($291 million after
tax) and $14 million ($10 million after tax) for the six months
ended June 30, 2022 and 2021, respectively.
3
Includes GRC track 3 impairment of $17
million ($12 million after tax) for both the three months ended and
the six months ended June 30, 2022.
4
Includes CSRP impairment of $47 million
($34 million after tax) for both the three months ended and the six
months ended June 30, 2022.
5
Includes charge for employment litigation
matter, net of recoveries, of $23 million ($16 million after tax)
for both the three months ended and the six months ended June 30,
2022.
6
Includes organizational realignment charge
of $14 million ($10 million after tax) for both the three months
ended and the six months ended June 30, 2022.
7
Includes gain from sale of San Onofre
nuclear fuel of $10 million ($7 million after tax) for both the
three months ended and the six months ended June 30, 2021.
Consolidated Statements of
Income
Edison International
Three months ended
Six months ended
June 30,
June 30,
(in millions, except per-share
amounts)
2022
2021
2022
2021
Total operating revenue
$
4,008
$
3,315
$
7,976
$
6,275
Purchased power and fuel
1,304
1,283
2,341
2,296
Operation and maintenance
1,361
754
2,848
1,595
Wildfire-related claims, net of insurance
recoveries
2
—
427
3
Wildfire Insurance Fund expense
53
54
106
107
Depreciation and amortization
601
533
1,184
1,058
Property and other taxes
120
117
246
243
Impairment, net of other operating
income
63
(11
)
61
(11
)
Total operating expenses
3,504
2,730
7,213
5,291
Operating income
504
585
763
984
Interest expense
(271
)
(232
)
(517
)
(449
)
Other income
66
76
134
148
Income before income taxes
299
429
380
683
Income tax expense (benefit)
7
68
(48
)
32
Net income
292
361
428
651
Preference stock dividend requirements of
SCE
25
26
51
53
Preferred stock dividend requirement of
Edison International
26
17
52
21
Net income attributable to Edison
International common shareholders
$
241
$
318
$
325
$
577
Basic earnings per share:
Weighted average shares of common stock
outstanding
381
380
381
379
Basic earnings per common share
attributable to Edison International common shareholders
$
0.63
$
0.84
$
0.85
$
1.52
Diluted earnings per share:
Weighted average shares of common stock
outstanding, including effect of dilutive securities
383
380
382
380
Diluted earnings per common share
attributable to Edison International common shareholders
$
0.63
$
0.84
$
0.85
$
1.52
Consolidated Balance Sheets
Edison International
June 30,
December 31,
(in millions)
2022
2021
ASSETS
Cash and cash equivalents
$
122
$
390
Receivables, less allowances of $347 and
$193 for uncollectible accounts at respective dates
1,547
1,398
Accrued unbilled revenue
1,096
794
Inventory
438
420
Prepaid expenses
50
258
Regulatory assets
2,030
1,778
Wildfire Insurance Fund contributions
204
204
Other current assets
166
249
Total current assets
5,653
5,491
Nuclear decommissioning trusts
4,039
4,870
Marketable securities
6
12
Other investments
52
39
Total investments
4,097
4,921
Utility property, plant and equipment,
less accumulated depreciation and amortization of $11,926 and
$11,407 at respective dates
51,485
50,497
Nonutility property, plant and equipment,
less accumulated depreciation of $106 and $98 at respective
dates
210
203
Total property, plant and
equipment
51,695
50,700
Receivables, less allowances of $34 and
$116 uncollectible accounts at respective dates
21
122
Regulatory assets (includes $845 and $325
related to Variable Interest Entities "VIEs" at respective
dates)
7,854
7,660
Wildfire Insurance Fund contributions
2,258
2,359
Operating lease right-of-use assets
1,751
1,932
Long-term insurance receivable
214
75
Other long-term assets
1,502
1,485
Total long-term assets
13,600
13,633
Total assets
$
75,045
$
74,745
Consolidated Balance Sheets
Edison International
June 30,
December 31,
(in millions, except share amounts)
2022
2021
LIABILITIES AND EQUITY
Short-term debt
$
1,985
$
2,354
Current portion of long-term debt
2,175
1,077
Accounts payable
2,080
2,002
Wildfire-related claims
86
131
Customer deposits
165
193
Regulatory liabilities
523
603
Current portion of operating lease
liabilities
607
582
Other current liabilities
1,641
1,667
Total current liabilities
9,262
8,609
Long-term debt (Includes $823 and
$314 related to VIEs at respective dates)
25,143
24,170
Deferred income taxes and credits
5,889
5,740
Pensions and benefits
471
496
Asset retirement obligations
2,837
2,772
Regulatory liabilities
8,376
8,981
Operating lease liabilities
1,144
1,350
Wildfire-related claims
1,169
1,733
Other deferred credits and other long-term
liabilities
3,079
3,105
Total deferred credits and other
liabilities
22,965
24,177
Total liabilities
57,370
56,956
Commitments and contingencies
Preferred stock (50,000,000 shares
authorized; 1,250,000 shares of Series A and 750,000 shares of
Series B issued and outstanding at respective dates)
1,977
1,977
Common stock, no par value (800,000,000
shares authorized; 381,397,456 and 380,378,145 shares issued and
outstanding at respective dates)
6,129
6,071
Accumulated other comprehensive loss
(48
)
(54
)
Retained earnings
7,716
7,894
Total Edison International's
shareholders' equity
15,774
15,888
Noncontrolling interests – preference
stock of SCE
1,901
1,901
Total equity
17,675
17,789
Total liabilities and equity
$
75,045
$
74,745
Consolidated Statements of Cash
Flows
Edison International
Six months ended June 30,
(in millions)
2022
2021
Cash flows from operating
activities:
Net income
$
428
$
651
Adjustments to reconcile to net cash
provided by operating activities:
Depreciation and amortization
1,216
1,090
Allowance for equity during
construction
(61
)
(60
)
Impairment and other expense (income)
64
(11
)
Deferred income taxes
(48
)
30
Wildfire Insurance Fund amortization
expense
106
107
Other
40
11
Nuclear decommissioning trusts
(65
)
(127
)
Changes in operating assets and
liabilities:
Receivables
(81
)
(293
)
Inventory
(19
)
(3
)
Accounts payable
143
128
Tax receivables and payables
58
91
Other current assets and liabilities
(229
)
(244
)
Regulatory assets and liabilities, net
372
(574
)
Wildfire-related insurance receivable
(139
)
708
Wildfire-related claims
(609
)
(2,852
)
Other noncurrent assets and
liabilities
62
(26
)
Net cash provided by (used in)
operating activities
1,238
(1,374
)
Cash flows from financing
activities:
Long-term debt issued, plus premium and
net of discount and issuance costs of $34 and $36 for the
respective periods
2,949
3,953
Long-term debt repaid
(372
)
(991
)
Short-term debt issued
600
2,106
Short-term debt repaid
(993
)
(1,355
)
Common stock issued
6
25
Preferred stock issued, net
—
1,235
Commercial paper repayments, net of
borrowing
(497
)
(656
)
Dividends and distribution to
noncontrolling interests
(57
)
(53
)
Common stock dividends paid
(524
)
(494
)
Preferred stock dividends paid
(46
)
—
Other
53
12
Net cash provided by financing
activities
1,119
3,782
Cash flows from investing
activities:
Capital expenditures
(2,708
)
(2,593
)
Proceeds from sale of nuclear
decommissioning trust investments
2,106
2,542
Purchases of nuclear decommissioning trust
investments
(2,041
)
(2,415
)
Other
15
54
Net cash used in investing
activities
(2,628
)
(2,412
)
Net decrease in cash, cash equivalents
and restricted cash
(271
)
(4
)
Cash, cash equivalents and restricted cash
at beginning of period
394
89
Cash, cash equivalents and restricted
cash at end of period
$
123
$
85
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220728005956/en/
Investor Relations: Sam Ramraj, (626) 302-2540 Media Contact:
Jeff Monford, (626) 476-8120
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