Edison International · NYSE:EIX
Edison International — Q3 2022 Earnings Presentation
26 slides from Edison International's earnings presentation, Nov 1, 2022
Slide 1: Third Quarter 2022 Financial Results
Third Quarter 2022 Financial Results November 1, 2022
Slide 2: Forward-Looking Statements
Forward-Looking Statements Statements contained in this presentation 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 statem
Slide 3: Edison International Third Quarter Update
Edison International Third Quarter Update Q3 2022 core EPS driven primarily by rate base GAAP EPS: ($0.33) earnings and CSRP final decision Core EPS1: $1.48 $4.48–4.68 EIX narrows 2022 EPS guidance 2022 Core EPS1 On pace to complete 4,300 SCE continues excellent WMP progress miles of covered conduct
Slide 4: SCE's ongoing deployment of covered conductor and other grid hardening measures
SCE’s ongoing deployment of covered conductor and other grid hardening measures helps keep its communities safe Total distribution Total Miles of Primary Distribution Lines lines in high fire ~17,000 risk areas (HFRA) Overhead vs. Overhead Underground underground miles ~10,000 ~7,000 Overhead mile
Slide 5: SCE revises best estimate of expected losses for 2017/2018 Wildfire/Mudslide Events
SCE revises best estimate of expected losses for 2017/2018 Wildfire/Mudslide Events by $880 million, to $8.8 billion Change driven • Statute of limitations for individual plaintiffs in Woolsey fire is now closed by new – Actual number of plaintiffs bringing claims now certain information – Have obta
Slide 6: Third Quarter Earnings Summary
Third Quarter Earnings Summary Q3 2022 Q3 2021 Variance Key SCE EPS Drivers2 2021 GRC true-up in Q3 20213 $ (0.35) Basic Earnings Per Share (EPS) Higher revenue 0.30 SCE $ (0.21) $ (0.75) $ 0.54 CPUC revenue - GRC escalation 0.19 CPUC revenue - Other 4,5 0.08 EIX Parent & Other (0.12) (0.15) 0.03 FE
Slide 7: SCE has significant capital expenditure opportunities
SCE has significant capital expenditure opportunities driven by investments in the safety and reliability of the grid Capital deployment expected to increase in future GRC and Total 2021–2025 capital plan of other applications1 $27–30 billion driven by Capital Expenditures, $ in Billions investments
Slide 8: 2021 GRC track 1 decision provides rate base visibility through 2023
2021 GRC track 1 decision provides rate base visibility through 2023; future applications expected to extend growth From a 2021 base, rate base growth forecast of 7–9% Forecast includes recovery of through 2025, reflecting future incremental investment utility-owned storage and SCE’s Rate Base1, $ i
Slide 9: EIX narrows 2022 core EPS guidance to $4.48–4.68
EIX narrows 2022 core EPS guidance to $4.48–4.68 from $4.40–4.70 EIX 2022 Core Earnings Per Share Guidance Range Key components of variances from Building from SCE Rate Base EPS SCE rate base EPS1 YTD 2022 Rate Base EPS Recorded1 Guidance1 Recording at current cost of capital pending 2022 cost of ca
Slide 10: EIX is executing on its 2022 financing plan
EIX is executing on its 2022 financing plan and has flexibility to defer equity content issuances to 2023 EIX 2022 Financing Plan1 Q2 Update Q3 Update Maturity Expect to refinance $700 million of Completed $400 million parent Refinancing parent debt with new debt refinancing in August issuances Ex
Slide 11: Offsets to higher interest rates; deliver on 5–7% EPS CAGR
EIX and SCE are identifying offsets to higher interest rates and expect to deliver on 5–7% 2021–2025 EPS CAGR Approximately $10 billion of the total ~$29 billion debt portfolio matures through 20271 Outstanding Short- and Long-Term Debt Maturities (Q4 2022–2027)1 as of September 30, 2022, $ in Milli
Slide 12: SCE's operational excellence program, Catalyst
SCE’s operational excellence program, Catalyst, includes >600 employee-driven ideas with capital and O&M benefits1 Major Themes Example High Impact Ideas Work Planning • Improve O&M cost efficiency by bundling work activities across inspections and repairs to reduce number of visits to the same asse
Slide 13: EIX reaffirms 5–7% 2021–2025 EPS growth rate target
EIX reaffirms 5–7% 2021–2025 EPS growth rate target, which would result in 2025 EPS of $5.50–5.901 Pursuing opportunities to deliver 5–7% growth rate 2025 Core Earnings per Share Component Ranges2 Component Tailwinds (▲) and Headwinds (▼) Rate Base EPS3 ▲ Non-GRC incremental capex opportunities Key
Slide 14: EIX has double-digit total return potential
EIX has double-digit total return potential, supported by leadership role in clean energy transition 5–7% core EPS CAGR1 Underpinned by strong rate base growth of ~7–9% 2021 to 2025 $27–30 billion 2021–2025 capital program ~4%+ 18 consecutive years of dividend growth current dividend yield2 Target d
Slide 15: Appendix
Appendix
Slide 16: Cost of Capital Status: Constructive proposed decisions issued for 2022
Cost of Capital Status: Constructive proposed decisions issued for 2022. PD for 2023–2025 expected in November Proposed Year ROE Status 2022 10.30% • Constructive proposed decision (PD) and alternate proposed decision (i.e., currently (APD) issued on September 30 authorized) • Both find that extraor
Slide 17: 2017/2018 Wildfire/Mudslide Events Update: ~85% of best estimate resolved
2017/2018 Wildfire/Mudslide Events Update: ~85% of best estimate resolved. Anticipate cost recovery filing by late 2023 SCE continues to make substantial …and SCE will seek CPUC recovery of prudently-incurred progress resolving claims… actual losses and related costs in excess of insurance $ in Bill
Slide 18: Edison's near-term debt maturities are manageable
Edison’s near-term debt maturities are manageable with ~33% tied to SCE’s operations or AB 1054 securitization Currently Outstanding Debt Maturities (Q4 2022–2027)1 $ in Millions, as of September 30, 2022 Q4 2022 2023 2024 2025 2026 2027 SCE term loan bridges Variable Rate (SOFR+) to 2023 securitiza
Slide 19: SCE funds wildfire claims payments with debt
SCE continues to fund wildfire claims payments above insurance and FERC rate recoveries with debt Wildfire Claims Payment-Related Debt Issuances Total issuance of $4.3 billion to- $ in Millions except percentages, as of September 30, 2022 date; additional debt to be issued as Series Principal Due Ra
Slide 20: Cash flow from memo account recovery and securitization
Cash flow from memo account recovery and securitization strengthens our balance sheet and credit metrics GRC, Uncollectibles, Wildfire-related, and Wildfire Insurance Applications $ in Millions1 Approved Applications Balance @ Recovery Remaining Rate Recovery by Year Application / Account Sept. 30 T
Slide 21: 2022 EIX Core Earnings Guidance Assumptions
2022 EIX Core Earnings Guidance Assumptions 2022 Assumption Additional Notes CPUC Rate Base ($ in Billions) $31.1 Return on Equity (ROE) 10.30% • ROE sensitivity: 4 cents EPS for 10bps change in ROE Equity in Capital Structure 52.0% FERC Rate Base ($ in Billions) $7.5 Return on Equity (ROE)1 10.30%
Slide 22: Year-to-Date Earnings Summary
Year-to-Date Earnings Summary YTD YTD 2022 2021 Variance Key SCE EPS Drivers2 Higher revenue $ 1.64 Basic Earnings Per Share (EPS) CPUC revenue - GRC escalation 0.53 SCE $ 0.97 $ 0.98 $ (0.01) CPUC revenue - Other 3,4 1.01 FERC and other operating revenue 0.10 EIX Parent & Other (0.45) (0.36) (0.09)
Slide 23: Earnings Non-GAAP Reconciliations
Earnings Non-GAAP Reconciliations Reconciliation of EIX GAAP Earnings to EIX Core Earnings Earnings (Losses) Attributable to Edison International, $ in Millions1 Q3 2022 Q3 2021 YTD 2022 YTD 2021 SCE $ (80) $ (284) $ 369 $ 371 EIX Parent & Other (48) (57) (172) (135) Basic Earnings $ (128) $ (341) $
Slide 24: EIX Core EPS Non-GAAP Reconciliations
EIX Core EPS Non-GAAP Reconciliations Reconciliation of EIX Basic Earnings Per Share to EIX Core Earnings Per Share EPS Attributable to Edison International1 Q3 2022 Q3 2021 YTD 2022 YTD 2021 Basic EPS $ (0.33) $ (0.90) $ 0.52 $ 0.62 Non-Core Items SCE 2017/2018 Wildfire/Mudslide Events claims and e
Slide 25: Earnings Per Share Non-GAAP Reconciliations
Earnings Per Share Non-GAAP Reconciliations Reconciliation of EIX Basic Earnings Per Share Guidance to EIX Core Earnings Per Share Guidance1 2022 EPS Attributable to Edison International Low High Basic EIX EPS $1.51 $1.71 Total Non-Core Items2 (2.97) (2.97) Core EIX EPS $4.48 $4.68 1. EPS is calcula
Slide 26: Use of Non-GAAP Financial Measures
Use of Non-GAAP Financial Measures Edison International's earnings are prepared in accordance with generally accepted accounting principles used in the United States. Management uses core earnings (losses) internally for financial planning and for analysis of performance. Core earnings (losses) are