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PG&E Annual Report, Year Ended Dec 31, 2011

Filing Date
Filed February 16, 2012
Period End
December 31, 2011
In the record · 2016–202610-K1310-Q338-K367

PCG filed 13 annual reports (10-K), 33 quarterly reports (10-Q) and 367 current reports (8-K) between 2016 and 2026.

  1. Material agreement8-K · Apr ’18Apr ’18
  2. Bankruptcy8-K · Jun ’20Jun ’20
  3. Leadership change8-K · Mar ’22Mar ’22
  4. Leadership change8-K · Dec ’25Dec ’25

01—Abstract

Summary

Summary of the 10-K filed February 16, 2012. Cited figures are marked; the original filing is the authoritative source.

PG&E Corporation and Pacific Gas and Electric Company filed a combined 2011 Annual Report on Form 10-K, dated February 16, 2012.

The Utility served approximately 5.2 million electricity distribution customers and 4.3 million natural gas distribution customers at December 31, 2011, with about $49.2 billiona in assets and 2011 revenues of $15 billion. PG&E Corporation reported 2011 income available for common shareholders of $844 million, or $2.10 per diluted share, down from $1,099 million in 2010. The filing states that the San Bruno pipeline accident of September 9, 2010 and the related investigations remain the dominant issue for the company.

The filing says the Utility believes it is probable the CPUC will impose penalties of at least $200 millionb and has accrued that amount as of December 31, 2011. The Utility has recorded a cumulative $375 million charge for third-party claims related to the accident and estimates it is reasonably possible it may incur up to an additional $225 million, for a total possible loss of $600 million. Penalties in excess of the accrual are described as unestimable and potentially material.

The CPSD also issued a citation with a penalty of approximately $17 millionc on January 27, 2012. The company faces a criminal investigation by federal and state authorities, and it forecasts 2012 natural gas pipeline costs of $450 million to $550 million that may not be recoverable through rates. The filing also reports that PG&E Corporation's common dividend is expected to remain at $1.82 per share in 2012, subject to the outcome of the natural gas matters.

The CPUC-authorized capital structure of 52%d common equity is in effect through 2012, and the Utility's next cost of capital application is due in April 2012. S&P downgraded PG&E Corporation's and the Utility's corporate and senior unsecured ratings in December 2011, though both remain investment grade.

02—Key points

Key Highlights

  1. 2011 income available for common shareholders was $844 million, or $2.10 per diluted share, versus $1,099 million, or $2.82, in 2010.
  2. The Utility accrued at least $200 million for probable CPUC penalties tied to pending investigations and self-reported violations, with penalties above that amount described as potentially material.
  3. A cumulative $375 million charge has been recorded for San Bruno third-party claims, with an additional $225 million reasonably possible, for a total possible loss of $600 million.
  4. The Utility forecasts 2012 natural gas pipeline costs of $450 million to $550 million that may not be recoverable through rates.
  5. The CPSD issued a citation and penalty of approximately $17 million on January 27, 2012 for self-reported natural gas violations.
  6. The 2012 common dividend is expected to stay at $1.82 per share, subject to the outcome of natural gas matters.
  7. The Utility's CPUC-authorized 2011 revenue requirement was approximately $6.0 billion, and the 2011 GRC authorized attrition increases of $180 million for 2012 and $185 million for 2013.

03—One dollar

04—Financials

Financial Highlights

Figures from 10-KFY2011filed February 16, 2012
Revenue$14.96BNet Income$858.00M5.7% Net MarginEPS (Diluted)$2.10Total Assets$49.75BCash & Equivalents$513.00MFree Cash Flow-$299.00M

Financial Statements

FY2011 against FY2010

Line itemFY2011FY2010Change
Revenue$14.96B$13.84B+8.1%
Operating Income$1.94B$2.31B−15.9%
Interest Expense$700.00M$684.00M+2.3%
Net Income$858.00M$1.10B−21.9%
EPS (Basic)$2.10$2.86−26.6%
EPS (Diluted)$2.10$2.82−25.5%
Shares Outstanding (Basic)401.00M382.00M+5.0%
Shares Outstanding (Diluted)402.00M392.00M+2.6%

05—Questions

Frequently Asked Questions

  1. What caused the financial pressure on PG&E in 2011?

    The San Bruno pipeline rupture on September 9, 2010 led to lawsuits, NTSB and CPUC findings, and multiple CPUC investigations. In 2011 the Utility recorded $483 million in pipeline-related expenses that will not be recovered through rates, and it accrued penalties and third-party claim charges.

  2. How much could the San Bruno matters ultimately cost the Utility?

    The filing says third-party claims could reach a total of $600 million, with $375 million already recorded. It also says penalties of at least $200 million are probable and accrued, but penalties above that amount cannot be estimated and could be material. Any civil or criminal penalties would not be recoverable from customers.

  3. Is PG&E's dividend at risk?

    The filing states that PG&E Corporation expects its Board to maintain the $1.82 annual common dividend in 2012, subject to the outcome of natural gas matters. The CPUC could adopt CPSD recommendations that would limit dividends, which the filing identifies as a risk.

  4. What is the status of the company's credit ratings?

    In December 2011, S&P downgraded the corporate and senior unsecured debt ratings of PG&E Corporation and the Utility, and the Utility's preferred stock rating. Both companies' corporate and senior unsecured ratings remained investment grade at December 31, 2011. Moody's affirmed its ratings and stable outlook on September 30, 2011.

06—Continue

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