PG&E Corporation Reports Second-Quarter Results; On Track to Deliver Solid 2024
- GAAP earnings were
$0.24 per share for the second quarter of 2024, compared to earnings of$0.19 for the same period in 2023. - Non-GAAP core earnings were
$0.31 per share for the second quarter of 2024, compared to earnings of$0.23 per share for the same period in 2023. - Recorded GAAP earnings were
$0.58 per share for the first half of 2024, compared to earnings of$0.46 per share for the same period in 2023. - Non-GAAP core earnings were
$0.69 per share for the first half of 2024, compared to earnings of$0.52 per share for the same period in 2023. - 2024 EPS GAAP guidance updated in the range of
$1.11 to$1.17 per share. - 2024 non-GAAP core EPS guidance reaffirmed at
$1.33 to$1.37 per share. - Forecasting no equity needs in 2024.
- Reaffirming 2024-2028 financing plan.
Safety and operational progress during the second quarter of 2024 includes:
- Installed 46 miles of underground powerlines and 43 miles of stronger poles and covered powerlines in the highest fire-risk areas.
- Connected 2,900 new residential and business customers to our electric system, for a total of 5,184 in 2024.
- Interconnected the first of four new renewable natural gas (RNG) facilities planned for 2024, enabling more
California -produced RNG to reach consumers and help reduce greenhouse-gas emissions. - Installed more than 220 electric vehicle charging ports for a total of approximately 720 new ports installed in 2024.
"We're delivering for our customers and hometowns today through a foundation of safe operations, wildfire risk reduction and solid financial progress. We also see a bright future where we lower average household energy costs, including from transportation, and further cut carbon emissions," said
Financial Results
The increase in GAAP results is primarily driven by an increase in customer capital investment, as approved in the 2023 General Rate Case final decision and which earns an equity return as approved in the Automatic Cost of Capital Adjustment Mechanism Advice Letter. Other drivers include non-fuel operating and maintenance savings achieved for the first half of 2024 for various programs such as reinventing our inspection processes, net of amounts reinvested back into the business for emergency preparedness and risk mitigation as two examples.
Non-GAAP Core Earnings
The increase in quarter-over-quarter non-GAAP core earnings per share is primarily driven by similar factors to the GAAP results, including customer capital investment, and non-fuel operating and maintenance savings, net of amounts reinvested back into the business as outlined above.
Non-core items, which management does not consider representative of ongoing earnings, totaled
2024 Guidance
The guidance range for projected 2024 non-GAAP core earnings is reaffirmed at
Guidance is based on various assumptions and forecasts, including those relating to authorized revenues, future expenses, capital expenditures, rate base, equity issuances, and certain other factors.
Supplemental Financial Information
In addition to the financial information accompanying this release, presentation slides have been furnished to the
Earnings Conference Call
What: Second Quarter 2024 Earnings Call
When:
Where: http://investor.pgecorp.com/news-events/events-and-presentations/default.aspx
A replay of the conference call will be archived at http://investor.pgecorp.com/news-events/events-and-presentations/default.aspx.
Alternatively, a toll-free replay of the conference call may be accessed shortly after the live call through
Public Dissemination of Certain Information
About
Forward-Looking Statements
This news release contains forward-looking statements that are not historical facts, including statements about the beliefs, expectations, estimates, future plans, and strategies of
PG&E CORPORATION |
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(Unaudited) |
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Three Months Ended |
|
Six Months Ended |
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|
2024 |
|
2023 |
|
2024 |
|
2023 |
Operating Revenues |
|
|
|
|
|
|
|
Electric |
$ 4,458 |
|
$ 3,852 |
|
$ 8,510 |
|
$ 7,971 |
Natural gas |
1,528 |
|
1,438 |
|
3,337 |
|
3,528 |
Total operating revenues |
5,986 |
|
5,290 |
|
11,847 |
|
11,499 |
Operating Expenses |
|
|
|
|
|
|
|
Cost of electricity |
763 |
|
672 |
|
1,084 |
|
1,194 |
Cost of natural gas |
204 |
|
274 |
|
733 |
|
1,190 |
Operating and maintenance |
2,757 |
|
2,436 |
|
5,393 |
|
5,113 |
SB 901 securitization charges, net |
— |
|
289 |
|
— |
|
562 |
Wildfire-related claims, net of recoveries |
(3) |
|
(1) |
|
(4) |
|
(3) |
|
78 |
|
117 |
|
156 |
|
234 |
Depreciation, amortization, and decommissioning |
1,053 |
|
997 |
|
2,075 |
|
2,074 |
Total operating expenses |
4,852 |
|
4,784 |
|
9,437 |
|
10,364 |
Operating Income |
1,134 |
|
506 |
|
2,410 |
|
1,135 |
Interest income |
202 |
|
143 |
|
339 |
|
255 |
Interest expense |
(812) |
|
(640) |
|
(1,527) |
|
(1,242) |
Other income, net |
82 |
|
66 |
|
158 |
|
151 |
Income Before Income Taxes |
606 |
|
75 |
|
1,380 |
|
299 |
Income tax provision (benefit) |
82 |
|
(335) |
|
121 |
|
(683) |
Net Income |
524 |
|
410 |
|
1,259 |
|
982 |
Preferred stock dividend requirement of subsidiary |
4 |
|
4 |
|
7 |
|
7 |
Income Available for Common Shareholders |
$ 520 |
|
$ 406 |
|
$ 1,252 |
|
$ 975 |
Weighted Average Common Shares Outstanding, Basic |
2,137 |
|
2,019 |
|
2,136 |
|
2,005 |
Weighted Average Common Shares Outstanding, Diluted |
2,142 |
|
2,139 |
|
2,141 |
|
2,137 |
Net Income Per Common Share, Basic |
$ 0.24 |
|
$ 0.20 |
|
$ 0.59 |
|
$ 0.49 |
Net Income Per Common Share, Diluted |
$ 0.24 |
|
$ 0.19 |
|
$ 0.58 |
|
$ 0.46 |
|
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|
|
|
|
|
|
Reconciliation of |
|
Three Months Ended
|
|
Six Months Ended
|
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Earnings |
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Earnings per |
|
Earnings |
|
Earnings per |
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(in millions, except per share amounts) |
2024 |
|
2023 |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
2024 |
|
2023 |
|
$ 520 |
|
$ 406 |
|
|
|
|
|
$ 1,252 |
|
$ 975 |
|
|
|
|
Non-core items: (1) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization of |
56 |
|
84 |
|
0.03 |
|
0.04 |
|
112 |
|
169 |
|
0.05 |
|
0.08 |
Bankruptcy and legal costs (3) |
13 |
|
17 |
|
0.01 |
|
0.01 |
|
25 |
|
33 |
|
0.01 |
|
0.02 |
|
3 |
|
(65) |
|
— |
|
(0.03) |
|
1 |
|
(139) |
|
— |
|
(0.07) |
Investigation remedies (5) |
15 |
|
2 |
|
0.01 |
|
— |
|
19 |
|
17 |
|
0.01 |
|
0.01 |
Prior period net regulatory impact (6) |
(6) |
|
(6) |
|
— |
|
— |
|
(12) |
|
(12) |
|
(0.01) |
|
(0.01) |
Strategic repositioning costs (7) |
— |
|
1 |
|
— |
|
— |
|
— |
|
2 |
|
— |
|
— |
Tax-related adjustments (8) |
70 |
|
— |
|
0.03 |
|
— |
|
70 |
|
— |
|
0.03 |
|
— |
Wildfire-related costs, net of insurance (9) |
4 |
|
55 |
|
— |
|
0.03 |
|
8 |
|
64 |
|
— |
|
0.03 |
|
$ 674 |
|
$ 494 |
|
|
|
|
|
$ 1,474 |
|
$ 1,109 |
|
|
|
|
|
|
All amounts presented in the table above and footnotes below are tax adjusted at |
|
|
|
(1) |
"Non-core items" include items that management does not consider representative of ongoing earnings and affect comparability of financial results between periods, consisting of the items listed in the table above. See Non-GAAP Financial Measures below. |
|
|
(2) |
The Utility recorded costs of |
|
|
(3) |
|
|
|
(4) |
The Utility recorded costs of |
|
|
(5) |
Includes costs associated with the decision different for the OII related to the 2017 Northern California Wildfires and 2018 |
|
|
(in millions) |
Three Months Ended |
|
Six Months Ended |
Wildfires OII disallowance and system enhancements |
$ 2 |
|
$ 3 |
Locate and mark OII system enhancements |
1 |
|
1 |
Paradise restoration and rebuild |
1 |
|
2 |
2020 Zogg fire settlement |
13 |
|
14 |
Investigation remedies |
$ 16 |
|
$ 20 |
Tax impacts |
(1) |
|
(1) |
Investigation remedies (post-tax) |
$ 15 |
|
$ 19 |
|
|
(6) |
The Utility recorded |
|
|
(7) |
Includes one-time costs related to repositioning |
|
|
(8) |
|
|
|
(9) |
Includes costs associated with the 2019 Kincade fire, 2020 Zogg fire, and 2021 Dixie fire, net of insurance, as shown below. |
|
|
(in millions) |
Three Months Ended |
|
Six Months Ended |
2019 Kincade fire-related costs |
$ 2 |
|
$ 5 |
2020 Zogg fire-related insurance recoveries |
— |
|
(1) |
2020 Zogg fire-related legal settlements |
(1) |
|
— |
2021 Dixie fire-related legal settlements |
5 |
|
7 |
Wildfire-related costs, net of insurance |
$ 6 |
|
$ 11 |
Tax impacts |
(2) |
|
(3) |
Wildfire-related costs, net of insurance (post-tax) |
$ 4 |
|
$ 8 |
|
|
(10) |
"Non-GAAP core earnings" is a non-GAAP financial measure. See Non-GAAP Financial Measures below. |
|
|
Undefined, capitalized terms have the meanings set forth in |
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2024 |
||||
EPS guidance |
Low |
|
High |
||
Estimated EPS on a GAAP basis |
~ |
$ 1.11 |
|
~ |
$ 1.17 |
Estimated non-core items: (1) |
|
|
|
|
|
Amortization of |
~ |
0.10 |
|
~ |
0.10 |
Bankruptcy and legal costs (3) |
~ |
0.03 |
|
~ |
0.01 |
SB 901 securitization (4) |
~ |
0.01 |
|
~ |
0.01 |
Investigation remedies (5) |
~ |
0.04 |
|
~ |
0.04 |
Prior period net regulatory impact (6) |
~ |
(0.01) |
|
~ |
(0.01) |
Tax-related adjustments (7) |
|
0.03 |
|
|
0.03 |
Wildfire-related costs, net of insurance (8) |
~ |
0.01 |
|
~ |
0.01 |
Estimated EPS on a non-GAAP core earnings basis |
~ |
$ 1.33 |
|
~ |
$ 1.37 |
|
|
All amounts presented in the table above and footnotes below are tax adjusted at |
|
|
|
(1) |
"Non-core items" include items that management does not consider representative of ongoing earnings and affect comparability of financial results between periods. See Non-GAAP Financial Measures below. |
|
|
(2) |
"Amortization of |
|
|
||||
|
2024 |
||||
(in millions) |
Low |
|
High |
||
Amortization of |
~ |
$ 305 |
|
~ |
$ 305 |
Amortization of |
~ |
$ 305 |
|
~ |
$ 305 |
Tax impacts |
~ |
(85) |
|
~ |
(85) |
Amortization of |
~ |
$ 220 |
|
~ |
$ 220 |
|
|
(3) |
"Bankruptcy and legal costs" consists of legal and other costs associated with |
|
2024 |
||||
(in millions) |
Low |
|
High |
||
Legal and other costs |
~ |
$ 90 |
|
~ |
$ 45 |
Bankruptcy and legal costs |
~ |
$ 90 |
|
~ |
$ 45 |
Tax impacts |
~ |
(25) |
|
~ |
(13) |
Bankruptcy and legal costs (post-tax) |
~ |
$ 65 |
|
~ |
$ 32 |
|
|
(4) |
"SB 901 securitization" includes the establishment of the SB 901 securitization regulatory asset and the SB 901 regulatory liability associated with revenue credits funded by net operating loss monetization. Also included are any earnings-impacting investment losses or gains associated with investments related to the contributions to the customer credit trust. |
|
|
2024 |
|||
(in millions) |
Low |
|
High |
||
SB 901 securitization charge |
~ |
$ 33 |
|
~ |
$ 33 |
Net gains related to customer credit trust |
~ |
(3) |
|
~ |
(3) |
SB 901 securitization |
~ |
$ 30 |
|
~ |
$ 30 |
Tax impacts |
~ |
(8) |
|
~ |
(8) |
SB 901 securitization (post-tax) |
~ |
$ 22 |
|
~ |
$ 22 |
|
|
(5) |
"Investigation remedies" includes costs related to the Paradise restoration and rebuild, the Wildfires OII decision different, the settlement agreement resolving the Safety and Enforcement Division's investigation into the 2020 Zogg fire, and the locate and mark OII system enhancements. |
|
2024 |
||||
(in millions) |
Low |
|
High |
||
2020 Zogg fire settlement |
~ |
$ 58 |
|
~ |
$ 58 |
Wildfires OII disallowance and system enhancements |
~ |
40 |
|
~ |
40 |
Paradise restoration and rebuild |
~ |
10 |
|
~ |
10 |
Locate and mark OII system enhancements |
~ |
5 |
|
~ |
5 |
Investigation remedies |
~ |
$ 113 |
|
~ |
$ 113 |
Tax impacts |
~ |
(30) |
|
~ |
(30) |
Investigation remedies (post-tax) |
~ |
$ 83 |
|
~ |
$ 83 |
|
|
(6) |
"Prior period net regulatory impact" represents the recovery of capital expenditures from 2011 through 2014 above amounts adopted in the 2011 GT&S rate case. |
|
2024 |
||||
(in millions) |
Low |
|
High |
||
2011-2014 GT&S capital audit |
~ |
$ (35) |
|
~ |
$ (35) |
Prior period net regulatory impact |
~ |
$ (35) |
|
~ |
$ (35) |
Tax impacts |
~ |
10 |
|
~ |
10 |
Prior period net regulatory impact (post-tax) |
~ |
$ (25) |
|
~ |
$ (25) |
|
|
(7) |
"Tax-related adjustments" includes tax expense costs associated with the deductibility of certain customer bill credits issued in connection with the |
|
|
(8) |
"Wildfire-related costs, net of insurance" includes legal and other costs associated with the 2019 Kincade fire, 2020 Zogg fire, and 2021 Dixie fire, net of insurance. |
|
2024 |
||||
(in millions) |
Low |
|
High |
||
2019 Kincade fire-related costs |
~ |
$ 15 |
|
~ |
$ 15 |
2020 Zogg fire-related legal settlements |
~ |
5 |
|
~ |
5 |
2020 Zogg fire-related insurance recoveries |
~ |
— |
|
~ |
(5) |
2021 Dixie fire-related legal settlements |
~ |
15 |
|
~ |
15 |
Wildfire-related costs, net of insurance |
~ |
$ 35 |
|
~ |
$ 30 |
Tax impacts |
~ |
(10) |
|
~ |
(8) |
Wildfire-related costs, net of insurance (post-tax) |
~ |
$ 25 |
|
~ |
$ 22 |
|
|
Undefined, capitalized terms have the meanings set forth in |
|
Non-GAAP Financial Measures
|
|
Non-GAAP Core Earnings and Non-GAAP Core EPS
"Non-GAAP core earnings" and "Non-GAAP core EPS," also referred to as "non-GAAP core earnings per share," are non-GAAP financial measures. Non-GAAP core earnings is calculated as income available for common shareholders less non-core items. "Non-core items" include items that management does not consider representative of ongoing earnings and affect comparability of financial results between periods, consisting of the items listed above. Non-GAAP core EPS is calculated as non-GAAP core earnings divided by common shares outstanding on a diluted basis.
Non-GAAP core earnings and non-GAAP core EPS are not substitutes or alternatives for GAAP measures such as consolidated income available for common shareholders and may not be comparable to similarly titled measures used by other companies.
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