Summary
Edison International (EIX) reported its second quarter 2020 financial results, with net income attributable to common shareholders of $318 million, a decrease from $392 million in the prior year's quarter. This decline was primarily driven by lower earnings at its subsidiary, Southern California Edison (SCE), which experienced a $38 million decrease in net income. The decrease in SCE's earnings was largely attributed to lower core earnings, impacted by the adoption of the 2018 GRC decision, wildfire mitigation activities, and COVID-19 related expenses. Despite a challenging operating environment, the company has maintained its access to capital markets and its credit ratings remain at investment grade levels. The company continues to actively manage risks associated with wildfires, including significant wildfire mitigation spending and insurance costs. AB 1054 legislation has introduced a framework for wildfire cost recovery and liability caps, providing some regulatory clarity. However, ongoing litigation and potential future wildfire events remain significant factors to monitor. The company also highlighted the impact of the COVID-19 pandemic on operations and financial flexibility, with measures taken to ensure liquidity.
Financial Highlights
46 data points| Revenue | $2.99B |
| Operating Expenses | $2.49B |
| Operating Income | $500.00M |
| Interest Expense | $229.00M |
| Net Income | $348.00M |
| EPS (Basic) | $0.85 |
| EPS (Diluted) | $0.85 |
| Shares Outstanding (Basic) | 375.00M |
| Shares Outstanding (Diluted) | 376.00M |
Key Highlights
- 1Net income attributable to common shareholders decreased by 18.4% to $318 million for the three months ended June 30, 2020, compared to $392 million for the same period in 2019.
- 2Southern California Edison (SCE) reported lower net income of $381 million for the quarter, down from $419 million in the prior year, primarily due to lower core earnings.
- 3Wildfire-related liabilities remain a significant factor, with an accrued liability of $4.5 billion for the 2017/2018 events, offset by expected insurance recoveries of $1.6 billion.
- 4The company has incurred $549 million in regulatory assets related to incremental wildfire mitigation expenses and $484 million for incremental wildfire insurance expenses as of June 30, 2020.
- 5AB 1054 legislation provides a framework for wildfire cost recovery and liability caps, with SCE having obtained its annual safety certification.
- 6COVID-19 impacts are being managed, with memorandum accounts established to track incremental costs, including $49 million incurred by SCE related to customer uncollectibles and operational adjustments.
- 7SCE's liquidity remains strong, with approximately $2.9 billion available under its $3.0 billion revolving credit facility at June 30, 2020.