10-QPeriod: Q2 FY2022

EDISON INTERNATIONAL Quarterly Report for Q2 Ended Jun 30, 2022

Filed July 28, 2022For Securities:EIX

Summary

Edison International (EIX) and its subsidiary Southern California Edison (SCE) reported a decrease in net income attributable to shareholders for the six months ended June 30, 2022, compared to the same period in 2021. This decline was primarily driven by increased non-core losses, particularly related to wildfire claims and expenses, despite an increase in core earnings from SCE. The company continues to navigate significant wildfire-related liabilities, with ongoing settlements and potential for material losses exceeding current accruals. Liquidity remains a focus, with SCE having substantial availability under its credit facilities. Capital expenditures are significant, with substantial investments planned in wildfire mitigation and grid modernization. Regulatory proceedings, including cost of capital applications and general rate cases, are ongoing and will influence future revenue requirements and investment recovery. Investors should monitor wildfire liabilities, regulatory outcomes, and capital expenditure plans.

Financial Highlights

46 data points
Beta

Revenue

$4.01B

Net Income

$292.00M

7.3% Net Margin

EPS (Diluted)

$0.63

Total Assets

$75.05B

Cash & Equivalents

$123.00M

Free Cash Flow

-$1.05B

Financial Statements
Beta
Revenue$4.01B
Operating Expenses$3.50B
Operating Income$504.00M
Interest Expense$271.00M
Net Income$292.00M
EPS (Basic)$0.63
EPS (Diluted)$0.63
Shares Outstanding (Basic)381.00M
Shares Outstanding (Diluted)383.00M

Key Highlights

  • 1Net income attributable to Edison International shareholders decreased by $252 million for the six months ended June 30, 2022, compared to the prior year, mainly due to higher non-core losses.
  • 2SCE's core earnings increased by $153 million for the six months ended June 30, 2022, driven by the adoption of the 2021 General Rate Case (GRC) final decision.
  • 3Wildfire-related claims and expenses, net of recoveries, represented a significant non-core item, with charges of $404 million ($291 million after-tax) recorded in the first six months of 2022 for the 2017/2018 Wildfire/Mudslide Events.
  • 4SCE's capital expenditure forecast for 2022-2024 totals $17.5 billion, with $3.3 billion allocated to wildfire mitigation.
  • 5SCE has approximately $3.1 billion available under its revolving credit facility as of June 30, 2022, indicating strong liquidity.
  • 6The company continues to manage significant wildfire-related liabilities, with an estimated $0.9 billion for remaining alleged and potential claims related to the 2017/2018 Wildfire/Mudslide Events and the SED Agreement as of June 30, 2022.
  • 7Regulatory proceedings are active, including a pending decision on SCE's 2022 cost of capital and filings for its 2023 cost of capital, which could impact revenue requirements.

Frequently Asked Questions

The primary driver for the decrease in net income for the six months ended June 30, 2022, compared to the same period in 2021, was a significant increase in non-core losses. These losses were largely attributable to higher charges for 2017/2018 Wildfire/Mudslide Events claims and expenses, along with other charges such as CSRP impairment and organizational realignment. While SCE's core earnings saw an increase, this was offset by these elevated non-core items.

Edison International and SCE are managing wildfire liabilities through ongoing settlements and accruals. As of June 30, 2022, the companies had paid $6.9 billion under executed settlements for the 2017/2018 Wildfire/Mudslide Events and had an estimated $0.9 billion for remaining alleged and potential claims related to these events and the SED Agreement. The company may incur material losses in excess of amounts accrued, and the ultimate recovery of uninsured costs through electric rates is subject to regulatory approval and considerable uncertainty.

SCE has a substantial capital expenditure forecast for 2022-2024, totaling approximately $17.5 billion. A significant portion of this, $3.3 billion, is dedicated to wildfire mitigation-related capital expenditures, reflecting the company's ongoing commitment to enhancing grid safety and resilience.

SCE maintains strong liquidity with approximately $3.1 billion available under its revolving credit facility as of June 30, 2022. The company expects to fund its cash requirements through operating cash flows, capital market financings, and debt refinancing. SCE has also extended its credit facilities, providing continued access to necessary funding.