10-QPeriod: Q2 FY2015

EDISON INTERNATIONAL Quarterly Report for Q2 Ended Jun 30, 2015

Filed July 30, 2015For Securities:EIX

Summary

Edison International (EIX) and its subsidiary Southern California Edison (SCE) reported solid financial results for the second quarter and the first half of 2015. Net income attributable to Edison International shareholders was $379 million for the quarter and $678 million for the six months, a decrease from the prior year primarily due to discontinued operations in 2014. However, core earnings from continuing operations showed a slight increase, reflecting higher income tax benefits for SCE and rate base growth. The company continues to invest heavily in its transmission and distribution infrastructure, with capital expenditures totaling $1.7 billion in the first six months of 2015, focused on maintaining reliability and enabling renewable energy integration. Significant ongoing developments include the resolution of the San Onofre nuclear facility's regulatory proceedings, which has led to customer refunds and a structured approach to cost recovery. While legal and regulatory challenges persist regarding the San Onofre settlement and past communications, the company is actively managing these issues. SCE's liquidity remains strong, supported by available credit facilities, and its capital structure is in compliance with debt covenants. The company anticipates continued capital investments to support modernization efforts and renewable energy initiatives.

Financial Highlights

41 data points
Beta

Revenue

$2.91B

Net Income

$406.00M

14.0% Net Margin

EPS (Diluted)

$1.15

Total Assets

$51.24B

Cash & Equivalents

$139.00M

Free Cash Flow

-$125.00M

Financial Statements
Beta
Revenue$2.91B
Operating Expenses$2.38B
Operating Income$524.00M
Interest Expense$138.00M
Net Income$406.00M
EPS (Basic)$1.16
EPS (Diluted)$1.15
Shares Outstanding (Basic)326.00M
Shares Outstanding (Diluted)328.00M

Key Highlights

  • 1Net income attributable to Edison International shareholders was $379 million for Q2 2015 and $678 million for H1 2015.
  • 2SCE's core earnings from continuing operations increased year-over-year, driven by income tax benefits and rate base growth.
  • 3Capital expenditures for the first six months of 2015 were $1.7 billion, primarily for transmission and distribution infrastructure upgrades.
  • 4The San Onofre OII Settlement Agreement was approved, leading to customer refunds and a framework for future cost recovery.
  • 5SCE's debt-to-total capitalization ratio was 0.46:1 at June 30, 2015, well within its credit facility covenant.
  • 6The company is actively managing ongoing legal and regulatory proceedings related to San Onofre, including ex parte communication investigations.
  • 7The collective bargaining agreement for approximately 3,900 employees with IBEW was approved, including retroactive pay increases.

Frequently Asked Questions

The decrease in net income was primarily due to significant income from discontinued operations in the second quarter and first half of 2014, related to the resolution of the EME bankruptcy proceedings. Excluding these discontinued operations, core earnings from continuing operations showed a slight increase.

Edison International and SCE are actively engaged in resolving matters related to San Onofre. This includes cooperating with investigations into ex parte communications with the CPUC, responding to legal challenges to the settlement agreement, and pursuing claims against third parties like MHI and NEIL. While these proceedings create uncertainty, the company is providing information and cooperating with regulatory bodies and courts.

Edison International, through SCE, plans significant capital investments. For the first six months of 2015, capital expenditures were $1.7 billion, and the company anticipates continued investment in its transmission and distribution system modernization, renewable energy integration, and grid reliability. The total capital expenditure forecast for 2015-2017 is in the range of $11.5 billion to $13.1 billion.

SCE maintains strong liquidity with $1.78 billion available under its revolving credit facility as of June 30, 2015. The company's debt-to-total capitalization ratio of 0.46:1 is well within its covenant limits. SCE expects to fund its obligations and capital expenditures through operating cash flows and capital market financings as needed.