Dba Sempra · NYSE:SRE
Dba Sempra — Q2 2022 Earnings Presentation
29 slides from Dba Sempra's earnings presentation, Aug 4, 2022
Slide 1: Second Quarter 2022 Earnings Results
Second Quarter 2022 Earnings Results August 4, 2022
Slide 2: Information Regarding Forward-Looking Statements
INFORMATION REGARDING FORWARD- LOOKING STATEMENTS This presentation 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
Slide 3: Table of Contents
TABLE OF CONTENTS • Executive Summary • Business Updates • Financial Results • Closing Remarks 3
Slide 4: Executive Summary
EXECUTIVE SUMMARY Sempra California Sempra Texas Sempra Infrastructure Operating in largest Operating in fastest Helping to solve dual economy + largest growing state + second challenge of global energy manufacturing base in U.S.1,2 largest manufacturing transition + energy security base in U.S.2,3
Slide 5: Business Updates
BUSINESS UPDATES • SDG&E + SoCalGas filed GRCs in May for 2024 – 2027 • 2023 – 2025 Cost of Capital final decision anticipated before year-end 1 • SDG&E received CPUC approval for four new microgrid energy storage facilities • SoCalGas achieved 37% methane emissions reduction, significantly exceedin
Slide 6: U.S. LNG Development Update
1 U.S. LNG DEVELOPMENT UPDATE CAMERON LNG PORT ARTHUR LNG Phase 2 Phase 1 • Permits | Pending FERC amendment 2 • Permits | FERC Order + DOE Export • FEED | Competitive process, targeted completion summer 2023 • EPC | Bechtel refresh underway Train 1-3 Debottlenecking • Long-Term Offtake Capacity | ~
Slide 7: Q2-2022 Financial Results
Q2-2022 FINANCIAL RESULTS Despite sales of NCI in Sempra Infrastructure Partners, Sempra achieved 7% increase in adjusted EPS in first six months of 2022 compared to same period in 20212,4 1. Related to property developer claims, four of which were settled in Q1 2022. 2. See Appendix for information
Slide 8: Q2-2022 Adjusted Earnings Drivers
Q2-2022 ADJUSTED EARNINGS DRIVERS $33M $626M $41M $48M $504M 1 1 Q2-2021 Higher TX Earnings Higher CA Higher SI Q2-2022 1,2 from Customer + CPUC Base Earnings Consumption Operating Margin Growth + Increase Net of Operating in Invested Capital Expenses + Higher FERC Margin 1. See Appendix for informa
Slide 9: Closing Remarks
CLOSING REMARKS Continuing strategic execution across three growth platforms in highly attractive markets in North America with a focus on safety and operational excellence FINANCIAL HIGHLIGHTS • Reporting Q2-2022 adjusted EPS of $1.98 and YTD-2022 adjusted EPS of $4.901 • Guiding to high end of FY-
Slide 10: Appendix I
APPENDIX | (5) SEMPRA
Slide 11: Sempra California Regulatory Summary
SEMPRA CALIFORNIA REGULATORY SUMMARY 1 2024 GRC SDG&E SoCalGas Revenue Request $3.0B $4.4B 2 Attrition (2025 – 2027) 8% – 12% 6% – 8% Effective Period 2024 – 2027 2024 – 2027 Cost of service (excludes commodity, energy efficiency, and certain balanced programs); Rate Review does not include certain
Slide 12: Sempra Texas | Oncor Base Rate Review Summary
SEMPRA TEXAS | ONCOR 1 BASE RATE REVIEW SUMMARY Oncor Equity Layer / ROE2 Requested 45% / 10.3% (Authorized 42.5% / 9.8%) Test Year 2021 (historical)3 4 Effective Period Estimated 2023-2026 Rate Review Cost of capital, cost of service (O&M), prudency review for new assets in service Key Dates Rates
Slide 13: Sempra Infrastructure Growth Pipeline
SEMPRA INFRASTRUCTURE 1 GROWTH PIPELINE LNG + NET-ZERO SOLUTIONS2 Commentary Status ECA LNG Phase 13 • First LNG expected by end of 2024 Construction (~3 Mtpa) Cameron LNG Phase 2 Train 1 – 3 Debottlenecking • Targeting online in stages prior to Cameron LNG Train 4 Development (~1 Mtpa) Train 4 • Pr
Slide 14: Q2 Sustainability Highlights
Q2 SUSTAINABILITY HIGHLIGHTS Advancing the decarbonization, diversification, and digitalization of our energy networks Sempra • Released 14th annual sustainability report describing our alignment with certain UN Sustainable Development Goals • Updated long-term energy transition action plan Sempra C
Slide 15: Utility Customer Bills
1 UTILITY CUSTOMER BILLS U.S. Average U.S. Average Texas Average 2 3 4 Electric Bill Natural Gas Bill Wires Charges 75th 75th 75th Percentile Percentile Percentile 50th 50th 50th Percentile Percentile Percentile SDG&E 25th 25th 25th Percentile Percentile Percentile SoCalGas + SDG&E Oncor Peer Range
Slide 16: Appendix II: Business Unit Earnings
APPENDIX II Business Unit Earnings 16
Slide 17: Sempra California | SDG&E
SEMPRA CALIFORNIA | SDG&E Three months ended Six months ended June 30, June 30, (Unaudited, dollars in millions) 2022 2021 2022 2021 SDG&E GAAP Earnings $ 176 $ 186 $ 410 $ 398 Q2-2022 earnings are lower than Q2-2021 earnings primarily due to: • $12M higher income tax expense primarily from flow-thr
Slide 18: Sempra California | SoCalGas
SEMPRA CALIFORNIA | SOCALGAS Q2-2022 adjusted earnings are higher than Q2-2021 earnings primarily due to: • $30M higher CPUC base operating margin, net of operating expenses, partially offset by • $4M lower income tax benefits primarily from flow-through items 1. Related to property developer claims
Slide 19: Sempra Texas Utilities
SEMPRA TEXAS UTILITIES Q2-2022 earnings are higher than Q2-2021 earnings primarily due to higher equity earnings from Oncor driven by: • Increased revenues from higher customer consumption, rate updates to reflect increases in invested capital, and customer growth, partially offset by • Increased ex
Slide 20: Sempra Infrastructure
SEMPRA INFRASTRUCTURE Q2-2022 adjusted earnings are higher than Q2-2021 adjusted earnings primarily due to: • $33M higher earnings from asset and supply optimization primarily driven by changes in natural gas prices offset by lower volumes, • $16M higher equity earnings from Cameron LNG JV primarily
Slide 21: Parent & Other
PARENT & OTHER Q2-2022 adjusted losses are lower than Q2-2021 adjusted losses primarily due to: • $30M income tax benefit in 2022 from changes to valuation allowance against certain tax credit carryforwards, • $19M lower income tax expense from the interim period application of an annual forecasted
Slide 22: Appendix III: Non-GAAP Financial Measures
APPENDIX III Non-GAAP Financial Measures 22
Slide 23: Adjusted Earnings and Adjusted EPS (Unaudited)
ADJUSTED EARNINGS AND ADJUSTED EPS (UNAUDITED) Sempra Adjusted Earnings and Adjusted EPS exclude items (after the effects of income taxes and, if applicable, NCI) in 2022 and 2021 as follows: In the three months ended June 30, 2022: • $(32)M from impacts associated with Aliso Canyon natural gas stor
Slide 24: Adjusted Earnings and Adjusted EPS (Unaudited)
ADJUSTED EARNINGS AND ADJUSTED EPS (UNAUDITED) Income tax (benefit) Non- Income tax expense Non- Pretax controlling Pretax controlling 1 1 amount expense interests Earnings amount (benefit) interests Earnings (Dollars in millions, except per share amounts; shares in thousands) Three months ended Jun
Slide 25: Adjusted Earnings (Losses) by Business Units (Unaudited)
ADJUSTED EARNINGS (LOSSES) BY BUSINESS UNITS (UNAUDITED) 1 Three months ended June 30, 2022 (Dollars in millions) Sempra Sempra Sempra Sempra SDG&E SoCalGas California Texas Utilities Infrastructure Parent & Other Consolidated GAAP Earnings (Losses) $ 176 $ 87 $ 263 $ 186 $ 183 $ (73) $ 559 Impacts
Slide 26: 2022 Adjusted EPS Guidance Range (Unaudited)
2022 ADJUSTED EPS GUIDANCE RANGE (UNAUDITED) Sempra 2022 Adjusted EPS Guidance Range of $8.10 to $8.70 excludes items (after the effects of income taxes and, if applicable, NCI) as follows: • $(98)M from impacts associated with Aliso Canyon natural gas storage facility litigation related to property
Slide 27: Appendix IV: Glossary
APPENDIX IV Glossary (5) SEMPRA
Slide 28: Glossary
GLOSSARY DEFINED TERMS ADIA Black Silverback ZC 2022 LP (assignee of Black River B 2017 Inc.), a wholly owned affiliate of Abu Dhabi Investment Authority BEA Bureau of Economic Analysis Bechtel Bechtel Oil, Gas and Chemicals, Inc. Cameron TotalEnergies, Mitsui, and a joint venture between Mitsubishi
Slide 29: Glossary Continued
GLOSSARY CONTINUED DEFINED TERMS LNG liquefied natural gas MOU Memorandum of Understanding Mtpa million tonnes per annum MW megawatt NCI noncontrolling interest NYK Nippon Yusen Kabushiki Kaisha PGNiG Polish Oil & Gas Company PUCT Public Utility Commission of Texas ROE return on equity RWE RWE Suppl