Pacific Gas & Electric Co. · NYSE:PCG
Pacific Gas & Electric — PG&E — Edison Electric Institute 40th Annual Financial Conference 2005
16 slides from Pacific Gas & Electric's conference presentation, Nov 7, 2005
Slide 1: Investor Package
Investor Package EE! 40 Annual Financial Conference Westin Diplomat Resort & Spa & Hollywood, FL November 6-9, 2005
Slide 2: Cautionary Statement Regarding Forward-Looking Information
Cautionary Statement Regarding Forward-Looking Information This presentation contains forward-looking statements regarding guidance for 2005 and 2006 earnings per share, cash flows, capital expenditures, rate base and rate base growth, stock repurchases, and dividends. These statements are based on
Slide 3: Industry Leadership Vision
Industry Leadership Vision Our vision Our goals Our strategies We act with ty and communi onestly and openly. How we work We are passionate about meeting customer needs and delivering for shareholders. together We are accountable for our actions. We work together as a team and are committed to excel
Slide 4: 2005 Priorities
2005 Priorities 1. Complete financial restoration 2. Transform the way we do business 3. Address electric procurement and owned generation 4, Enhance communications 5. Invest in utility infrastructure
Slide 5: Financial Restoration
Financial Restoration v Authorized equity ratio Achieved 52% in January 2005 ¥ Common Dividend Resumed at $1.20 per share annually Targeted at $1.32 per share for 4Q’05 v Energy Recovery Bonds $1.9B issued in February ~$850MM to be issued in November v Share Repurchases $1.05B ASR executed in March
Slide 6: EPS Guidance
EPS Guidance EPS Guidance from Operations* 2005 at upper end of $2.20-$2.30 per share 2006 guidance of $2.35-$2.45 per share EPS from Operations * $2.50 Hi Guidance Range $2.30 $2.10 5 a $1.90 2004A 2005E 2006E * Reg G reconciliation to GAAP for 2004 EPS from Operations and 2005 and 2006 EPS Guidanc
Slide 7: Transformation Vision
Transformation Vision Deliver value through operational excellence and customer service * Standardization prevails * Relentless focus on efficiency Understand the Customer Technology/ Innovation * Responsive to customer expectations ¢ Use of technology to drive operational excellence * Deliver new p
Slide 8: Transformation Enhancing Performance
Transformation Enhancing Performance Today (Manual) 2007 (Automated) Outage Management Outage Management — Customer notifies the utility of a problem - Utility systems immediately locate problems — Multiple manual steps to mobilize resources — Automatic mobilization of right resources and capacity —
Slide 9: Metrics Examples
Metrics Examples Engaged Employees: Lost work day case rate * Employee survey index * Cost-Efficient Service: Average productive hours per field employee per day Strategic sourcing savings * Delighted Customers: System average interruption duration index * JD Power Residential Customer Satisfaction
Slide 10: Savings Proposals in 2007 GRC
Savings Proposals in 2007 GRC Estimated net transformation savings reduce cost increases in 2008-2009 GRC Attrition Request and Impact of Proposed Savings ($MM)* $250 $200 sso | S167MM $242MM $100 $50 | Net increase @ Est Net Savings 2008 AU) * To be updated in formal 2007 GRC application in Decembe
Slide 11: Electric Procurement and Owned Generation
Electric Procurement and Owned Generation * Near-term stability, long-term focus * Expected transfer of Contra Costa Unit 8 (530 MW) - Partially constructed (approximately 40%) — Estimate of $310MM to complete — CPUC decision expected 1Q 2006 * RFO process for new generation - Up to 2,200 MW of new
Slide 12: Forecast of Utility Infrastructure Investments
Forecast of Utility Infrastructure Investments Estimated Average Annual Capital Expenditures ($MM) Major Categories of Est. Capital Spending 2007-2009 ($B) ss00 $1,900 $2,400 $2,500 Distribution (as indicated in GRC NO!) $45 $2,000 , Diablo steam generation replacement 1 O15) $1,500 Completion of Co
Slide 13: PG&E Corporation: A Value Opportunity
PG&E Corporation: A Value Opportunity A pure-play utility offering a stable platform and regulated growth Stability: * minimum equity ratio and ROE ¢ low commodity exposure ¢ balancing account for sales variability Regulated growth: « strong cash flow ¢ utility infrastructure investments ¢ solid rat
Slide 14: Reg G Reconciliation
Reg G Reconciliation 2004 2004 PG&E Corporation EPS on an Earnings from Operations Basis $2.12 Items Impacting Comparability: Gain resulting from prior year impact and recognition of reg. asset from 2003 GRC approval 0.28 Recovery of previously incurred costs related to electric industry restructuri
Slide 15: Reg G Reconciliation
Reg G Reconciliation 2005 Low High PG&E Corporation EPS Guidance on an Earnings from Operations Basis $2.20 $2.30 Estimated Items Impacting Comparability: Incremental interest expense 1 (0.01) (0.01) Demand-side management & CEE initiatives 2 0.24 0.24 Discontinued Operations - NEGT ? 0.03 0.03 PG&E
Slide 16: Metrics Definitions
Metrics Definitions * Lost workday case rate. As defined by the Bureau of Labor and Statistics, this measure is the number of lost workday cases for every 100 employees for cases of nonfatal occupational injuries and illnesses that result in at least one day away from work. ¢ Employee survey index.
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