10-QPeriod: Q1 FY2022

EDISON INTERNATIONAL Quarterly Report for Q1 Ended Mar 31, 2022

Filed May 3, 2022For Securities:EIX

Summary

Edison International (EIX) reported a net income of $84 million for the first quarter of 2022, a significant decrease from $259 million in the same period of 2021. This decline was primarily driven by a $149 million decrease in Southern California Edison's (SCE) earnings, largely due to a substantial increase in wildfire-related claims and expenses. Despite higher core earnings for SCE, the impact of non-core items, particularly wildfire claims, overshadowed this improvement. The company continues to navigate significant risks related to wildfire liabilities, regulatory proceedings, and capital expenditures for grid modernization and wildfire mitigation. Management highlights the ongoing uncertainty regarding the recovery of certain wildfire-related costs through regulated rates, emphasizing the importance of future CPUC decisions.

Financial Highlights

46 data points
Beta

Revenue

$3.97B

Net Income

$136.00M

3.4% Net Margin

EPS (Diluted)

$0.22

Total Assets

$74.72B

Cash & Equivalents

$234.00M

Free Cash Flow

-$415.00M

Financial Statements
Beta
Revenue$3.97B
Operating Expenses$3.71B
Operating Income$259.00M
Interest Expense$246.00M
Net Income$136.00M
EPS (Basic)$0.22
EPS (Diluted)$0.22
Shares Outstanding (Basic)381.00M
Shares Outstanding (Diluted)382.00M

Key Highlights

  • 1Net income attributable to Edison International decreased by $175 million to $84 million in Q1 2022 compared to Q1 2021.
  • 2Southern California Edison (SCE) experienced a substantial increase in wildfire-related claims and expenses, contributing significantly to the overall earnings decline.
  • 3SCE's core earnings increased by $132 million, primarily due to the adoption of the 2021 General Rate Case final decision.
  • 4Total capital expenditures for SCE were $1.3 billion in Q1 2022, with a forecast of $11.8 billion for 2022-2023, focused on traditional infrastructure and wildfire mitigation.
  • 5The company continues to estimate material losses related to the 2017/2018 Wildfire/Mudslide Events, with an additional $416 million increase in estimated losses recorded in Q1 2022.
  • 6Regulatory uncertainty remains a key concern, particularly regarding SCE's ability to recover uninsured wildfire-related costs through regulated rates.
  • 7SCE's liquidity remains adequate with approximately $2.9 billion available under its credit facility as of March 31, 2022.

Frequently Asked Questions

The primary driver was a significant increase in wildfire-related claims and expenses for Southern California Edison (SCE), which more than offset an increase in SCE's core earnings. These non-core wildfire charges amounted to $285 million after-tax in Q1 2022, compared to only $4 million in Q1 2021.

Edison International and SCE continue to estimate and manage potential losses from the 2017/2018 Wildfire/Mudslide Events. In the first quarter of 2022, the estimated losses were increased by $416 million. The company is seeking to recover prudently-incurred losses above insurance coverage through electric rates, but faces substantial uncertainty regarding CPUC approval for certain costs.

Edison International plans significant capital expenditures, with SCE forecasting $11.8 billion for 2022-2023, focusing on traditional capital projects, wildfire mitigation, and grid modernization. The company is also investing in utility-owned energy storage projects, though facing potential delays due to supply chain issues.

Yes, regulatory proceedings concerning the cost of capital and wildfire cost recovery remain critical. Additionally, ongoing litigation and investigations related to past wildfires create significant contingent liabilities and potential financial impacts, although the company is actively pursuing settlements and recovery strategies.