OAKLAND,
Calif., April 25, 2024 /PRNewswire/ -- PG&E
Corporation (NYSE: PCG) is on track to deliver solid 2024 results.
Financial progress includes:
- GAAP earnings were $0.34 per
share for the first quarter of 2024, compared to earnings of
$0.27 for the same period in
2023.
- Non-GAAP core earnings were $0.37
per share for the first quarter of 2024, compared to earnings of
$0.29 per share for the same period
in 2023.
- 2024 EPS GAAP guidance updated in the range of $1.15 to $1.20 per
share.
- 2024 non-GAAP core EPS guidance reaffirmed at $1.33 to $1.37 per
share.
- Forecasting no equity needs in 2024.
- Providing 2024-2028 financing plan.
Safety and operational progress during the first quarter of 2024
includes:
- Completed a 300-mile in-line inspection of our natural gas
transmission line that brings in natural gas from out of
California. With this completion,
three of Pacific Gas and Electric Company's (Utility's) four
backbone natural gas transmission lines are now fully
inspected.
- Connected more than 2,200 new residential and business
customers to our electric system.
- Installed nearly 500 electric vehicle charging ports.
- Energized 15 miles of underground powerlines in the highest
fire threat areas, adding to the 664 completed 2019 through
2023.
"Our focus on safety and reducing wildfire risk continues every
day as we deliver for our customers and our hometowns here in
California. We remain committed to
building a clean, climate-resilient energy system to meet our
customers' future needs at the lowest price for them," said
PG&E Corporation CEO Patti
Poppe.
Financial Results
PG&E Corporation recorded first-quarter 2024 income
available for common shareholders of $732
million, or $0.34 per share,
as reported in accordance with generally accepted accounting
principles (GAAP). This compares with income available for
common shareholders of $569 million,
or $0.27 per share, for the first
quarter of 2023.
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 (O&M) savings achieved for the first quarter, net
of amounts reinvested back into the business to fund various
programs such as increased transmission system inspections and
electric asset mapping. An additional driver for GAAP results
includes lower costs related to the Wildfire Fund amortization
expense, due to an increase in the estimated period of coverage of
the Wildfire Fund from 15 to 20 years.
PG&E Corporation uses "non-GAAP core earnings," which is a
non-GAAP financial measure, in order to provide a measure that
allows investors to compare the underlying financial performance of
the business from one period to another, exclusive of non-core
items. See the accompanying tables for a reconciliation of non-GAAP
core earnings to consolidated earnings available for common
shareholders.
Non-GAAP Core Earnings
PG&E Corporation's non-GAAP core earnings, which exclude
non-core items, were $800 million, or
$0.37 per share, in the first quarter
of 2024, compared with $615 million,
or $0.29 per share, during the same
period in 2023.
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 $68 million after
tax, or $0.03 per share, in the first
quarter of 2024, compared with $46 million after tax, or
$0.02 per share, during the same
period in 2023.
2024 Guidance
PG&E Corporation is updating 2024 GAAP earnings guidance in
the range of $1.15 to $1.20 per share (previously $1.10 to $1.14 per
share). Factors driving GAAP earnings include costs related to
unrecoverable interest expense of $285
million to $365 million after
tax and other earnings factors, including allowance for funds used
during construction equity, incentive revenues, tax benefits, and
cost savings, net of below-the-line costs. Additional factors
include the amortization of the Wildfire Fund asset and accretion
of the related Wildfire Fund liability, PG&E Corporation's and
the Utility's reorganization cases under Chapter 11,
wildfire-related costs, and investigation remedies, partially
offset by prior period net regulatory impact.
The guidance range for projected 2024 non-GAAP core earnings is
reaffirmed at $1.33 to $1.37 per share. The guidance range for non-core
items, which management does not consider representative of ongoing
earnings, is $360 million to
$380 million after tax.
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.
Financing Plan Highlights
PG&E Corporation shared its five-year financing plan, which
includes funding $62 billion of
safety and reliability capital expenditures. The plan, which does
not assume a sale of the Utility's non-nuclear generation assets,
reaffirms PG&E Corporation's commitment of no new equity in
2024; enables substantial dividend growth over the five-year
horizon; and assumes up to $3 billion
of potential equity needs over the period 2025 through 2028.
Supplemental Financial Information
In addition to the financial information accompanying this
release, presentation slides have been furnished to the Securities
and Exchange Commission (SEC) and are available on PG&E
Corporation's website at:
http://investor.pgecorp.com/financials/quarterly-earnings-reports/default.aspx.
Earnings Conference Call
PG&E Corporation will also hold a conference call on
April 25, 2024, at 11:00 a.m. Eastern
Time (8:00 a.m. Pacific Time)
to discuss its first quarter 2024 results. The public can access
the conference call through a simultaneous webcast. The link is
provided below and will also be available from the PG&E
Corporation website.
What: First Quarter 2024 Earnings Call
When: Thursday, April 25, 2024 at 11:00 a.m. Eastern Time
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 May 2, 2024, by dialing (800) 770-2030.
International callers may dial (647) 362-9199. For both
domestic and international callers, the confirmation code 92587
will be required to access the replay.
Public Dissemination of Certain Information
PG&E Corporation and the Utility routinely provide links to
the Utility's principal regulatory proceedings with the California
Public Utilities Commission and the Federal Energy Regulatory
Commission at http://investor.pgecorp.com, under the "Regulatory
Filings" tab, so that such filings are available to investors upon
filing with the relevant agency. PG&E Corporation and the
Utility also routinely post, or provide direct links to,
presentations, documents, and other information that may be of
interest to investors at http://investor.pgecorp.com, under
the "Wildfire and Safety Updates" and "News & Events:
Events & Presentations" tabs, respectively, in order to
publicly disseminate such information. It is possible that any of
these filings or information included therein could be deemed to be
material information.
About PG&E Corporation
PG&E Corporation (NYSE: PCG) is a holding company
headquartered in Oakland,
California. It is the parent company of Pacific Gas and
Electric Company, an energy company that serves 16 million
Californians across a 70,000-square-mile service area in Northern
and Central California. For more information, visit
http://www.pgecorp.com.
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 and the Utility, including regarding earnings,
operating cost savings, capital investments, financings, and
dividends. These statements are based on current expectations and
assumptions, which management believes are reasonable, and on
information currently available to management, but are necessarily
subject to various risks and uncertainties. In addition to the risk
that these assumptions prove to be inaccurate, factors that could
cause actual results to differ materially from those contemplated
by the forward-looking statements include factors disclosed in
PG&E Corporation's and the Utility's joint Annual Report on
Form 10-K for the year ended December 31,
2023, their most recent Quarterly Report on Form 10-Q for
the quarter ended March 31, 2024, and
other reports filed with the SEC, which are available on PG&E
Corporation's website at www.pgecorp.com and on the SEC's website
at www.sec.gov. PG&E Corporation and the Utility undertake no
obligation to publicly update or revise any forward-looking
statements, whether due to new information, future events or
otherwise, except to the extent required by law.
PG&E
CORPORATION CONSOLIDATED STATEMENTS OF
INCOME (in millions, except per share
amounts)
|
|
|
(Unaudited)
|
|
Three Months Ended
March 31,
|
|
2024
|
|
2023
|
Operating
Revenues
|
|
|
|
Electric
|
$
4,052
|
|
$
4,119
|
Natural gas
|
1,809
|
|
2,090
|
Total operating
revenues
|
5,861
|
|
6,209
|
Operating
Expenses
|
|
|
|
Cost of
electricity
|
321
|
|
522
|
Cost of natural
gas
|
529
|
|
916
|
Operating and
maintenance
|
2,636
|
|
2,677
|
SB 901 securitization
charge, net
|
—
|
|
273
|
Wildfire-related
claims, net of insurance recoveries
|
(1)
|
|
(2)
|
Wildfire Fund
expense
|
78
|
|
117
|
Depreciation,
amortization, and decommissioning
|
1,022
|
|
1,077
|
Total operating
expenses
|
4,585
|
|
5,580
|
Operating
Income
|
1,276
|
|
629
|
Interest
income
|
137
|
|
112
|
Interest
expense
|
(715)
|
|
(602)
|
Other income,
net
|
76
|
|
85
|
Reorganization
items, net
|
|
|
—
|
Income Before Income
Taxes
|
774
|
|
224
|
Income tax provision
(benefit)
|
39
|
|
(348)
|
Net Income
|
735
|
|
572
|
Preferred stock
dividend requirement of subsidiary
|
3
|
|
3
|
Income Available for
Common Shareholders
|
$
732
|
|
$
569
|
Weighted Average
Common Shares Outstanding, Basic
|
2,134
|
|
1,991
|
Weighted Average
Common Shares Outstanding, Diluted
|
2,139
|
|
2,132
|
Net Earnings Per
Common Share, Basic
|
$
0.34
|
|
$
0.29
|
Net Earnings Per
Common Share, Diluted
|
$
0.34
|
|
$
0.27
|
Reconciliation of
PG&E Corporation's Consolidated Earnings Available for Common
Shareholders in Accordance with Generally Accepted Accounting
Principles ("GAAP") to Non-GAAP Core Earnings
First Quarter, 2024 vs. 2023
|
|
Three Months
Ended
March
31,
|
|
Earnings
|
|
Earnings per
Common
Share
|
(in millions, except
per share amounts)
|
2024
|
|
2023
|
|
2024
|
|
2023
|
PG&E
Corporation's earnings/EPS on a GAAP basis
|
$
732
|
|
$
569
|
|
$
0.34
|
|
$
0.27
|
Non-core items:
(1)
|
|
|
|
|
|
|
|
Amortization of
Wildfire Fund contribution (2)
|
56
|
|
84
|
|
0.03
|
|
0.04
|
Bankruptcy and legal
costs (3)
|
12
|
|
17
|
|
0.01
|
|
0.01
|
Fire Victim Trust tax
benefit net of securitization (4)
|
(2)
|
|
(74)
|
|
—
|
|
(0.03)
|
Investigation remedies
(5)
|
4
|
|
15
|
|
—
|
|
0.01
|
Prior period net
regulatory impact (6)
|
(6)
|
|
(6)
|
|
—
|
|
—
|
Strategic
repositioning costs (7)
|
—
|
|
1
|
|
—
|
|
—
|
Wildfire-related
costs, net of insurance (8)
|
4
|
|
9
|
|
—
|
|
—
|
PG&E
Corporation's non-GAAP core earnings/EPS (9)
|
$
800
|
|
$
615
|
|
$
0.37
|
|
$
0.29
|
|
|
All amounts presented
in the table above and footnotes below are tax adjusted at PG&E
Corporation's statutory tax rate of 27.98% for 2024 and 2023,
except for certain costs that are not tax deductible. Earnings per
Common Share is calculated based on diluted shares. Amounts may not
sum due to rounding.
|
|
(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 $78 million (before the tax impact of $22 million) during
the three months ended March 31, 2024, associated with the
amortization of the Wildfire Fund asset and accretion of the
related Wildfire Fund liability.
|
|
|
(3)
|
PG&E Corporation
and the Utility recorded costs of $17 million (before the tax
impact of $5 million) during the three months ended March 31, 2024
related to bankruptcy and legal costs associated with PG&E
Corporation's and the Utility's Chapter 11 filing, including legal
and other costs.
|
|
|
(4)
|
The Utility recorded a
net gain of $3 million (before the tax impact of $1 million) during
the three months ended March 31, 2024 related to any
earnings-impacting investment losses or gains associated with
investments related to the contributions to the customer credit
trust. Previously included the charge related to the establishment
of the SB901 securitization regulatory asset and the SB901
securitization regulatory liability associated with revenue credits
funded by the net operating loss monetization and tax benefits
related to the Fire Victim's Trust's sale of PG&E corporation
common stock.
|
|
|
(5)
|
Includes costs
associated with the decision different for the OII related to the
2017 Northern California Wildfires and 2018 Camp Fire ("Wildfires
OII"), the system enhancements related to the locate and mark OII,
restoration and rebuilding costs for the town of Paradise, and the
settlement agreement resolving the Safety and Enforcement
Division's investigation into the 2020 Zogg fire, as shown
below.
|
(in
millions)
|
Three Months
Ended
March 31, 2024
|
Wildfires OII
disallowance and system enhancements
|
$
2
|
Locate and mark OII
system enhancements
|
1
|
Paradise restoration
and rebuild
|
1
|
2020 Zogg fire
settlement
|
1
|
Investigation
remedies (pre-tax)
|
$
4
|
Tax impacts
|
—
|
Investigation
remedies (post-tax)
|
$
4
|
(6)
|
The Utility recorded $8
million (before the tax impact of $2 million) during the three
months ended March 31, 2024 related to adjustments associated with
the recovery of capital expenditures from 2011 through 2014 above
amounts adopted in the 2011 GT&S rate case per the CPUC
decision dated July 14, 2022.
|
|
|
(7)
|
Includes one-time costs
related to repositioning PG&E Corporation's and the Utility's
operating model.
|
|
|
(8)
|
Includes costs
associated with the 2019 Kincade fire and 2021 Dixie fire, net of
insurance, as shown below.
|
(in
millions)
|
Three Months
Ended
March 31, 2024
|
2019 Kincade
fire-related costs
|
$
2
|
2020 Zogg fire-related
insurance recoveries
|
—
|
2020 Zogg fire-related
legal settlements
|
—
|
2021 Dixie
fire-related legal settlements
|
2
|
Wildfire-related
costs, net of insurance (pre-tax)
|
$
5
|
Tax impacts
|
(1)
|
Wildfire-related
costs, net of insurance (post-tax)
|
$
4
|
(9)
|
"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 PG&E Corporation's and the
Utility's joint Quarterly Report on Form 10-Q for the quarter ended
March 31, 2024.
|
PG&E Corporation's
2024 Earnings Guidance
|
|
|
2024
|
EPS
guidance
|
Low
|
|
High
|
Estimated EPS on a
GAAP basis
|
~
|
$
1.15
|
|
~
|
$
1.20
|
Estimated non-core
items: (1)
|
|
|
|
|
|
Amortization of
Wildfire Fund contribution (2)
|
~
|
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)
|
Wildfire-related
costs, net of insurance (7)
|
~
|
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 PG&E
Corporation's statutory tax rate of 27.98% for 2024, except for
certain costs that are not tax deductible. Amounts may not sum due
to rounding.
|
|
(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
Wildfire Fund contribution" represents the amortization of the
Wildfire Fund asset and accretion of the related Wildfire Fund
liability.
|
|
2024
|
(in millions,
pre-tax)
|
Low
guidance
range
|
|
High
guidance
range
|
Amortization of
Wildfire Fund contribution
|
~
|
$
305
|
|
~
|
$
305
|
Amortization of
Wildfire Fund contribution (pre-tax)
|
~
|
$
305
|
|
~
|
$
305
|
Tax impacts
|
~
|
(85)
|
|
~
|
(85)
|
Amortization of
Wildfire Fund contribution (post-tax)
|
~
|
$
220
|
|
~
|
$
220
|
(3)
|
"Bankruptcy and legal
costs" consists of legal and other costs associated with PG&E
Corporation's and the Utility's Chapter 11 filing.
|
|
2024
|
(in millions,
pre-tax)
|
Low
guidance
range
|
|
High
guidance
range
|
Legal and other
costs
|
~
|
$
75
|
|
~
|
$
30
|
Bankruptcy and legal
costs (pre-tax)
|
~
|
$
75
|
|
~
|
$
30
|
Tax impacts
|
~
|
(21)
|
|
~
|
(8)
|
Bankruptcy and legal
costs (post-tax)
|
~
|
$
54
|
|
~
|
$
22
|
(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,
pre-tax)
|
Low
guidance
range
|
|
High
guidance
range
|
SB 901 securitization
charge
|
~
|
$
33
|
|
~
|
$
33
|
Net gains related to
customer credit trust
|
~
|
(3)
|
|
~
|
(3)
|
SB 901
securitization (pre-tax)
|
~
|
$
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,
pre-tax)
|
Low
guidance
range
|
|
High
guidance
range
|
2020 Zogg fire
settlement
|
~
|
75
|
|
~
|
75
|
Wildfires OII
disallowance and system enhancements
|
~
|
40
|
|
~
|
40
|
Paradise restoration
and rebuild
|
~
|
$
10
|
|
~
|
$
10
|
Locate and mark OII
system enhancements
|
~
|
5
|
|
~
|
5
|
Investigation
remedies (pre-tax)
|
~
|
$
130
|
|
~
|
$
130
|
Tax impacts
|
~
|
(35)
|
|
~
|
(35)
|
Investigation
remedies (post-tax)
|
~
|
$
95
|
|
~
|
$
95
|
(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,
pre-tax)
|
Low
guidance
range
|
|
High
guidance
range
|
2011-2014 GT&S
capital audit
|
~
|
$
(35)
|
|
~
|
$
(35)
|
Prior period net
regulatory impact (pre-tax)
|
~
|
$
(35)
|
|
~
|
$
(35)
|
Tax impacts
|
~
|
10
|
|
~
|
10
|
Prior period net
regulatory impact (post-tax)
|
~
|
$
(25)
|
|
~
|
$
(25)
|
(7)
|
"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,
pre-tax)
|
Low
guidance
range
|
|
High
guidance
range
|
2019 Kincade
fire-related costs
|
~
|
$
15
|
|
~
|
$
15
|
2020 Zogg fire-related
costs
|
~
|
5
|
|
~
|
5
|
2020 Zogg fire-related
insurance recoveries
|
~
|
(5)
|
|
~
|
(5)
|
2021 Dixie
fire-related legal settlements
|
~
|
15
|
|
~
|
15
|
Wildfire-related
costs, net of insurance (pre-tax)
|
~
|
$
30
|
|
~
|
$
30
|
Tax impacts
|
~
|
(8)
|
|
~
|
(8)
|
Wildfire-related
costs, net of insurance (post-tax)
|
~
|
$
22
|
|
~
|
$
22
|
Undefined, capitalized
terms have the meanings set forth in PG&E Corporation's and the
Utility's joint Quarterly Report on Form 10-Q for the quarter ended
March 31, 2024.
|
|
Non-GAAP Financial
Measures
PG&E Corporation
and Pacific Gas and Electric Company
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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.
PG&E Corporation discloses historical financial results and
provides guidance based on "non-GAAP core earnings" and "non-GAAP
core EPS" in order to provide a measure that allows
investors to compare the underlying financial performance of the
business from one period to another, exclusive of
non-core items. PG&E Corporation and the Utility use
non-GAAP core earnings and non-GAAP core EPS to understand and
compare operating results across reporting periods for various
purposes including internal budgeting and forecasting, short- and
long-term operating planning, and employee incentive compensation.
PG&E Corporation and the Utility believe that non-GAAP core
earnings and non-GAAP core EPS provide additional insight into the
underlying trends of the business, allowing for a better comparison
against historical results and expectations for future performance.
With respect to our projection of non-GAAP core EPS for the years
2025-2028, PG&E Corporation is unable to predict with
reasonable certainty the reconciling items that may affect GAAP net
income without unreasonable effort. The reconciling items are
primarily due to the future impact of wildfire-related costs,
timing of regulatory recoveries, special tax items, and
investigation remedies. These reconciling items are uncertain,
depend on various factors and could significantly impact, either
individually or in the aggregate, the GAAP measures.
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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SOURCE PG&E Corporation