Slide 1: Third Quarter Earnings Call
THIRD QUARTER EARNINGS CALL November 2, 2017
Slide 2: Forward Looking Statements
Forward Looking Statements T his slide presentation contains statements regarding management’s expectations and objectives for future periods as well as forecasts and estimates of PG&E Corporation’s 2017 financial results, 2017 items impacting comparability, 2017 equity issuance, 2017-2019 capital e
Slide 3: Northern California Wildfires
Northern California Wildfires Our thoughts and prayers are with the affected customers who experienced these extraordinary fires We conducted an unprecedented restoration effort and will continue helping our customers and communities as they rebuild We are committed to cooperating with Cal Fir
Slide 4: Well-positioned to Deliver Strong Returns
Well-positioned to Deliver Strong Returns Building on Safety and Operational Performance • Continuing focus on public, employee, and contractor safety • Delivering reliable gas and electric service Healthy 3-year Delivering on Customer Expectations growth profile • Improving customer service through
Slide 5: Q3 2017 Earnings Results
Q3 2017 Earnings Results Q3 2017 Earnings Earnings EPS EPS (millions) (millions) Earnings on a GAAP basis $ 550 $ 1.07 $ 1,532 $ 2.98 Items Impacting Comparability Pipeline related expenses 12 0.02 45 0.09 Legal and regulatory related expenses 1 - 5 0.01 Fines and penalties 11 0.02 47 0.09 Butte fir
Slide 6: Q3 2017: Quarter over Quarter Comparison
Q3 2017: Quarter over Quarter Comparison Earnings per Share from Operations $1.40 $0.07 ($0.10) $1.20 $0.04 $0.05 ($0.02) $0.06 $0.08 $1.00 $0.80 $0.60 $1.12 $0.94 $0.40 $0.20 $0.00 Q3 2016 EPS Timing of Taxes Timing of Growth in Rate Timing of GT&S Miscellaneous Impact of 2017 Increase in Q3 2017 E
Slide 7: 2017 Earnings Per Share Guidance
2017 Earnings Per Share Guidance Low High Estimated EPS on a GAAP Basis $ 3.36 $ 3.56 Estimated Items Impacting Comparability Pipeline related expenses ~ 0.10 ~ 0.10 Legal and regulatory related expenses ~ 0.01 ~ 0.01 Fines and penalties ~ 0.09 ~ 0.09 Butte fire-related costs, net of insurance 0.05
Slide 8: 2017 Assumptions
2017 Assumptions Capital Expenditures Authorized Ratebase (weighted average) ($ millions) ($ billions) 2017 2017 General Rate Case 3,700 General Rate Case 24.6 Gas Transmission and Storage 900 Gas Transmission and Storage 3.0 Transmission Owner 18 1,100 Transmission Owner 6.8 Total Cap Ex ~$5.7 bill
Slide 9: 2017 Items Impacting Comparability
2017 Items Impacting Comparability ($ millions, pre-tax) 2017 Pipeline related expenses (1) ~ 90 Legal and regulatory related expenses ~ 10 Fines and penalties (2) ~ 71 Butte fire-related costs, net of insurance 46 Net benefit from derivative litigation settlement (65) GT&S revenue timing impact (15
Slide 10: 2017 Equity Issuance
2017 Equity Issuance $400 - 500M 2017 September 30, 2017 shares outstanding: ~514 million See the Forward Looking Statements for factors that could cause actual results to differ materially from the guidance presented and underlying assumptions. 10
Slide 11: Robust Cap Ex Supports Strong Returns
Robust Cap Ex Supports Strong Returns Capital Expenditures ($ in B) 2017-2019 ~$6.3B ~$6B ~$5.7B 2017 2018 2019 General Rate Case Gas Transmission & Storage Electric Transmission Owner Range See the Forward Looking Statements for factors that could cause actual results to differ materially from the
Slide 12: Ratebase Supports Strong Returns
Ratebase Supports Strong Returns Weighted Average Ratebase ($ in B) Base Case Assumptions: 2017-2019 • 2017 General Rate Case through 2019 • 2015 Gas Transmission & Storage rate case ~6.5 - 7% – Phase 2 decision through 2018; flat in 2019 CAGR – ~$400M for 2011-2014 spend subject to audit added in ~
Slide 13: Dividend Policy Supports Strong Total Shareholder Return
Dividend Policy Supports Strong Total Shareholder Return + ~8% + ~8% ~60% Payout $2.60 Ratio $2.12 $1.96 $1.82 2015 2016 2017 2019 Targeting 55-65% payout ratio over time See the Forward Looking Statements for factors that could cause actual results to differ materially from the guidance presented a
Slide 14: Appendix
[t PG&E Corporation Appendix
Slide 15: Appendix – Supplemental Earnings Materials
Appendix – Supplemental Earnings Materials Exhibit A: Reconciliation of PG&E Corporation’s Consolidated Income Available Slides 16-17 for Common Shareholders in Accordance with Generally Accepted Accounting Principles to Earnings from Operations Exhibit B: Key Drivers of PG&E Corporation’s Earnings
Slide 16: Exhibit A: Reconciliation to Earnings from Operations (1 of 2)
Exhibit A: Reconciliation of PG&E Corporation’s Consolidated Income Available for Common Shareholders in Accordance with Generally Accepted Accounting Principles (“GAAP”) to Earnings from Operations Page 1 of 2 Third Quarter and Year to Date, 2017 vs. 2016 Three Months Ended S eptember 30, Nine Mont
Slide 17: Exhibit A: Reconciliation to Earnings from Operations (2 of 2)
Exhibit A: Reconciliation of PG&E Corporation’s Consolidated Income Available for Common Shareholders in Accordance with Generally Accepted Accounting Principles (“GAAP”) to Earnings from Operations Page 2 of 2 Three Months Ended Nine Months Ended (in millions, pre-tax) S eptember 30, 2017 S eptembe
Slide 18: Exhibit B: Key Drivers of Earnings per Common Share
Exhibit B: Key Drivers of PG&E Corporation’s Earnings per Common Share (“EPS”) from Operations Third Quarter and Year to Date, 2017 vs. 2016 (in millions, except per share amounts) Three Months Ended Nine Months Ended September 30, 2017 September 30, 2017 Earnings per Earnings per Common Common Shar
Slide 19: Exhibit C: Operational Performance Metrics
Exhibit C: Operational Performance Metrics Meets YTD 2017 Year to Date Q3 Actual EOY Target Target (1) Safety (includes both public and employee safety metrics) Nuclear Operations Safety Unit 1 Performance Indicator 97.0 90.5 Unit 2 Performance Indicator 90.0 87.6 Electric Operations Safety Elec
Slide 20: Definitions of 2017 Operational Performance Metrics
Definitions of 2017 Operational Performance Metrics from Exhibit C Safety Public and employee safety are measured in four areas: (1) Nuclear Operations Safety, (2) Electric Operations Safety, (3) Gas Operations Safety, and (4) Employee Safety. 1. The safety of the Utility’s nuclear power operations,
Slide 21: Exhibit D: Sales and Sources Summary
Exhibit D: Pacific Gas and Electric Company Sales and Sources Summary Third Quarter and Year to Date, 2017 vs. 2016 Three Months Ended September 30, Nine Months Ended September 30, 2017 2016 2017 2016 Sales from Energy Deliveries (in millions kWh) 24,160 24,067 62,914 63,486 Total Electric Customers
Slide 22: 2017 Earnings per Share Guidance (1 of 2)
Exhibit E: PG&E Corporation’s 2017 Earnings per Share Guidance Page 1 of 2 2017 EPS Guidance Low High Estimated EPS on a GAAP Basis $ 3.36 $ 3.56 (1) Estimated Items Impacting Comparability: (2) Pipeline related expenses ~ 0.10 ~ 0.10 (3) Legal and regulatory related expenses ~ 0.01 ~ 0.01 (4) Fines
Slide 23: 2017 Earnings per Share Guidance (2 of 2)
Exhibit E: PG&E Corporation’s 2017 Earnings per Share Guidance Page 2 of 2 (5) “ Butte fire-related costs, net of insurance” refers to the costs associated with the Butte fire, net of insurance. T he Utility currently is unable to estimate the low and high end of the guidance range of Butte fire-rel
Slide 24: 2017 General Earnings Sensitivities
Exhibit F: 2017 General Earnings Sensitivities PG&E Corporation and Pacific Gas and Electric Company Variable Description of Change Estimated 2017 Earnings Impact Rate base +/- $100 million change in allowed rate base +/- $5 million Return on equity (ROE) +/- 0.1% change in allowed ROE +/- $18 milli
Slide 25: Use of Non-GAAP Financial Measures
Exhibit G: Use of Non-GAAP Financial Measures PG&E Corporation and Pacific Gas and Electric Company: Use of Non-GAAP Financial Measures PG&E Corporation discloses historical financial results and provides guidance based on “earnings from operations” in order to provide a measure that allows investor
Slide 26: Expected Timelines of Selected Regulatory Cases
Exhibit H: Pacific Gas and Electric Company Expected Timelines of Selected Regulatory Cases Regulatory Case Docket # Key Dates 2017 General Rate Case (Phase I) A. 15-09-001 Sep 1, 2015 – Application Filed Sep 29, 2015 – Application Workshop Oct 29, 2015 – Prehearing conference Jan 22, 2016 – PG&E Su
Slide 27: Expected Timelines of Selected Regulatory Cases
Exhibit H: Pacific Gas and Electric Company Expected Timelines of Selected Regulatory Cases Regulatory Case Docket # Key Dates 2015 Electric Distribution Resources Plan A.15-07-006, Aug 13, 2014 – Commission issues OIR directing utilities to file Electric Distribution Resources Plans (DRP) R.14-08-0
Slide 28: Expected Timelines of Selected Regulatory Cases
Exhibit H: Pacific Gas and Electric Company Expected Timelines of Selected Regulatory Cases Regulatory Case Docket # Key Dates 2015 Electric Distribution Resources Plan A.15-07-006, Jun 15, 2017 – Decision on PG&E's revised Field Demo D (DRP) R.14-08-013 Jun 19, 2017 – PG&E filed comments on CPUC St
Slide 29: Expected Timelines of Selected Regulatory Cases
Exhibit H: Pacific Gas and Electric Company Expected Timelines of Selected Regulatory Cases Regulatory Case Docket # Key Dates Integration of Distributed Energy R.14-10-003 Sep 22, 2015 – Decision to expand scope to include distributed energy resources (DERs) on system side of customer's meter Resou
Slide 30: Expected Timelines of Selected Regulatory Cases
Exhibit H: Pacific Gas and Electric Company Expected Timelines of Selected Regulatory Cases Regulatory Case Docket # Key Dates Ex Parte Order Instituting Investigation and I.15-11-015 Apr 18, 2016 – Joint meet and confer report filed by parties Order to Show Cause Apr 20, 2016 – Prehearing conferenc