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SRE · Sempra

31 filings

10-K

SRE 10-K Annual Reports

Sempra - 31 annual reports

Filing record · 2016–202610-K1110-Q338-K216

2025
Sempra Annual Report, Year Ended Dec 31, 2025
Sempra Energy (SRE) has filed its 2025 Form 10-K, detailing its financial performance and operational highlights across its key segments: Sempra California, Sempra Texas Utilities, and Sempra Infrastructure. The company continues to focus on its strategy of building America's leading utility growth business by investing in regulated utilities in California and Texas, alongside energy infrastructure development. A significant event disclosed is the planned sale of a 45% equity interest in SI Partners to KKR Partners, expected to close in mid-2026, which will result in Sempra deconsolidating SI Partners and accounting for its remaining 25% interest under the equity method. This strategic move aims to enhance shareholder value and optimize capital allocation. The company's regulated utilities in California, San Diego Gas & Electric (SDG&E) and Southern California Gas Company (SoCalGas), are subject to extensive regulatory oversight, with ongoing proceedings impacting rates and cost recovery. The Sempra Infrastructure segment is actively developing and constructing several large-scale LNG projects, including Cameron LNG Phase 1 and Phase 2, and Port Arthur LNG Phase 1 and Phase 2, which represent significant investments and growth opportunities, albeit with inherent project development risks. The company's financial results for 2025 reflect varying performance across segments, with Sempra California experiencing a decrease in earnings primarily due to regulatory disallowances, while Sempra Texas Utilities saw an increase driven by Oncor's performance. Sempra Infrastructure reported losses in 2025, largely due to tax expenses related to assets held for sale and foreign currency impacts.
Feb 26, 2026
2024
Sempra Annual Report, Year Ended Dec 31, 2024
Sempra Energy (SRE) reported its 2024 annual results, showcasing a robust financial performance driven by its diverse energy infrastructure portfolio across California, Texas, and Mexico. The company's regulated utility operations in California (SDG&E and SoCalGas) demonstrated stability, supported by updated revenue requirements from the CPUC. The Sempra Infrastructure segment continued to advance key development projects, including the ECA LNG Phase 1 and PA LNG Phase 1 projects, contributing positively to segment earnings. Sempra Texas Utilities, primarily through its investment in Oncor, also showed earnings growth. The company maintained a strong liquidity position and actively managed its capital structure, undertaking significant debt and equity issuances to support its capital expenditure plan. Looking ahead, Sempra remains focused on its mission to be North America's premier energy infrastructure company, emphasizing investments in transmission and distribution, and pursuing opportunities in cleaner energy solutions.
Feb 25, 2025
2023
Sempra Annual Report, Year Ended Dec 31, 2023
Sempra Energy (SRE) filed its 2023 Annual Report on Form 10-K, highlighting a strong operational performance across its three key segments: Sempra California, Sempra Texas Utilities, and Sempra Infrastructure. The company continues to focus on its mission to be North America's premier energy infrastructure company, emphasizing investments in transmission and distribution to ensure stable cash flows and earnings visibility. Financially, Sempra reported growth in earnings attributable to common shares, driven by strong performance in Sempra California and Sempra Infrastructure, despite challenges in the Sempra Texas Utilities segment primarily due to higher interest and depreciation expenses at Oncor Holdings. The company made significant capital expenditures, investing $8.8 billion in 2023, with plans for approximately $9.2 billion in 2024, primarily focused on infrastructure improvements and LNG projects. Sempra also managed its capital structure effectively, maintaining investment-grade credit ratings, and continued to return value to shareholders through dividends. Key strategic initiatives include the ongoing development of major LNG projects like PA LNG Phase 1 and ECA LNG Phase 1, as well as investments in renewable energy and low-carbon solutions. The company also noted progress in regulatory matters, including CPUC approvals and rate case updates, while navigating potential risks related to wildfires, cybersecurity, and regulatory changes in its operating regions.
Feb 27, 2024
2022
Sempra Annual Report, Year Ended Dec 31, 2022
Sempra Energy's (SRE) 2022 Form 10-K filing reveals a robust year marked by significant investments in infrastructure and strategic capital allocation across its diverse energy segments. The company demonstrated resilience, particularly within its California utilities (SDG&E and SoCalGas), which saw earnings growth driven by higher operating margins and regulatory adjustments, despite ongoing transition efforts in the energy landscape. SoCalGas notably improved its financial performance, largely due to a substantial reduction in charges related to the Aliso Canyon natural gas leak. Sempra Infrastructure continues to advance its international projects, with key developments in the LNG sector, including progress on the Cameron LNG Phase 2 and PA LNG projects, though these face inherent development risks. Sempra Texas Utilities, through its stake in Oncor, contributed positively, benefiting from rate updates and increased customer consumption. The company's overall financial health remains solid, supported by strong liquidity, consistent capital expenditures focused on infrastructure improvements and clean energy initiatives, and a commitment to shareholder returns through dividends and share repurchases.
Feb 28, 2023
2021
Sempra Annual Report, Year Ended Dec 31, 2021
Sempra Energy (SRE) reported its 2021 annual results, showcasing a robust operational performance across its key segments: Sempra California (SDG&E and SoCalGas), Sempra Texas Utilities (Oncor), and Sempra Infrastructure. The company's strategic focus on optimizing its business model and concentrating on North American energy infrastructure investments is evident. Sempra successfully consolidated its non-utility energy infrastructure assets under SI Partners and continued to advance its clean energy transition initiatives. Despite a significant charge related to the Aliso Canyon leak impacting SoCalGas's earnings, the overall results reflect the company's resilience and diversified business model. Key financial highlights include substantial capital expenditures supporting infrastructure improvements and growth projects. The company also actively managed its capital structure, including debt redemptions and equity transactions, reinforcing its financial flexibility and commitment to shareholder value. Sempra's outlook remains focused on disciplined growth and the safe, reliable delivery of energy to its customers.
Feb 25, 2022
2020
Sempra Annual Report, Year Ended Dec 31, 2020
Sempra Energy (SRE) reported strong financial performance for the year ended December 30, 2020, marked by significant growth in earnings attributable to common shares, driven by contributions from its utility and energy-related businesses. The company successfully executed its portfolio optimization strategy, completing the divestiture of its South American operations, achieving full commercial operations at Cameron LNG Phase 1, and reaching a final investment decision for ECA LNG Phase 1. These strategic moves have sharpened Sempra Energy's focus on North America, aligning with its mission to be a premier energy infrastructure company. The company's regulated utilities, San Diego Gas & Electric (SDG&E) and Southern California Gas Company (SoCalGas), demonstrated stable performance, though SoCalGas incurred charges related to the Aliso Canyon litigation. Sempra Texas Utilities saw increased earnings driven by contributions from its investment in Oncor. Sempra Mexico's performance was influenced by foreign currency effects and regulatory actions impacting its renewable energy projects, while Sempra LNG's results improved significantly due to the commencement of commercial operations at Cameron LNG Phase 1. Looking ahead, Sempra Energy plans substantial capital expenditures and investments, primarily focused on transmission and distribution improvements at its regulated utilities and further development of its LNG export facilities, underscoring a commitment to long-term growth and shareholder value.
Feb 25, 2021
2019
Sempra Annual Report, Year Ended Dec 31, 2019
Sempra Energy (SRE) reported solid financial results for the fiscal year ending December 31, 2019, driven by strong performance across its utility operations in California and Texas, as well as its international energy infrastructure business in Mexico. The company continued its strategic portfolio optimization, progressing with the divestiture of its South American businesses, expected to close in the first half of 2020, and completing the sale of its renewable energy assets. Significant investments were made in its Texas utility operations through the acquisition of an interest in Oncor and Sharyland Utilities. Furthermore, the Sempra LNG segment saw progress with the commencement of commercial operations for Train 1 of the Cameron LNG JV project. Key financial metrics showed improvement, with increased earnings and EPS compared to the previous year, supported by constructive regulatory outcomes for its California utilities and growth in its Texas segment. The company's outlook remains focused on expanding its North American energy infrastructure footprint while maintaining a strong financial position.
Feb 27, 2020
2018
Sempra Annual Report, Year Ended Dec 31, 2018
Sempra Energy (SRE) reported a strong financial performance in its 2019 10-K filing, driven by its regulated utility operations in California (SDG&E and SoCalGas) and strategic investments in energy infrastructure. The company's business strategy focuses on becoming North America's premier energy infrastructure company, emphasizing stable, predictable earnings and cash flows. Sempra Energy made significant progress in its capital rotation plan, divesting non-core assets in South America and U.S. renewables while investing heavily in its North American utility and infrastructure businesses, notably through its acquisition of an indirect interest in Oncor, a major Texas electric transmission and distribution company. The company navigated a complex operating environment, including regulatory proceedings, wildfire risks in California, and ongoing efforts to mitigate the impacts of the Aliso Canyon gas leak. Despite these challenges, Sempra Energy demonstrated resilience, with increased earnings and diluted EPS compared to the prior year, reflecting effective operational management and strategic capital allocation. The report details the company's segmented performance, financial condition, and risk factors, providing investors with a comprehensive view of its operations and outlook.
Feb 26, 2019
2017
Sempra Annual Report, Year Ended Dec 31, 2017
Sempra Energy (SRE) reported a significant decrease in net income for 2017 compared to 2016, primarily due to a $208 million charge related to wildfire costs for SDG&E and a $870 million income tax expense resulting from the Tax Cuts and Jobs Act of 2017. Despite these headwinds, the company made substantial progress on its strategic initiatives, most notably entering into an agreement to acquire Energy Future Holdings Corp. (EFH), the indirect owner of 80.03% of Oncor Electric Delivery Company LLC, a major Texas electric transmission and distribution utility. This pending acquisition, valued at $9.45 billion in cash, is expected to close in the first half of 2018 and is anticipated to expand Sempra's regulated earnings base and provide a platform for future growth. Operationally, the company's various segments, including utilities in California and South America, infrastructure development in Mexico and the U.S. renewables market, and LNG and midstream operations, all contributed to the overall financial performance. While Sempra Utilities (SDG&E and SoCalGas) experienced a dip in earnings, Sempra Infrastructure segments, particularly Sempra Mexico and Sempra Renewables, showed growth driven by acquisitions and new projects. Sempra LNG & Midstream faced challenges, resulting in a loss for the year, partly due to pipeline capacity releases and unfavorable results in midstream activities.
Feb 27, 2018
2016
Sempra Annual Report, Year Ended Dec 31, 2016
Sempra Energy's 2016 combined Form 10-K (filed February 28, 2017, jointly with SDG&E and SoCalGas) reports GAAP earnings of $1.37 billion, or $5.46 diluted EPS, up about 2% from $1.35 billion in 2015. Adjusted earnings, a non-GAAP measure management uses internally, were $1.27 billion, or $5.05 per share, after excluding a $617 million pretax remeasurement gain on the Gasoductos de Chihuahua (GdC) acquisition and several impairments and one-time items. Growth was driven by Sempra Mexico, whose earnings rose to $463 million, while Sempra LNG & Midstream swung to a $107 million loss on a $206 million charge to permanently release pipeline capacity. The California Utilities earned $570 million at SDG&E and $349 million at SoCalGas, both down year over year, largely because of income tax repair refunds ordered by the CPUC's 2016 General Rate Case decision. The dominant risk for investors is the Aliso Canyon natural gas storage leak at SoCalGas. Sempra has recorded an estimated $780 million of costs and a $606 million insurance receivable, with $169 million of insurance proceeds received to date. The filing notes that the estimate may rise significantly and excludes unsettled damage claims and fines. As of February 27, 2017, 250 lawsuits involving more than 14,000 plaintiffs had been filed, and injections at the facility remain suspended pending regulatory approval. Other material items include the Cameron LNG three-train liquefaction project, which is roughly $7 billion of incremental investment with Sempra guaranteeing up to $3.9 billion of project debt and facing potential construction delays, and about $352 million of SDG&E wildfire-cost regulatory assets whose recovery is not yet approved. Sempra's 2017 capital expenditure plan is about $3.4 billion, and the board raised the quarterly dividend to $0.8225 per share.
Feb 28, 2017
2015
Sempra Annual Report, Year Ended Dec 31, 2015
Sempra Energy's 2015 Form 10-K (combined filing with SDG&E and SoCalGas) reports a year of earnings growth overshadowed by a major operational and legal event. Sempra's 2015 earnings rose 16% to $1.349 billion, or $5.37 diluted EPS, driven by stronger California utility results, higher Sempra Mexico pipeline earnings, and a $61 million gain on the sale of the remaining Mesquite Power block. The dominant risk factor is the October 2015 Aliso Canyon gas leak at SoCalGas, which was permanently sealed on February 18, 2016. As of February 24, 2016, 83 lawsuits had been filed, criminal and civil actions are pending, and SoCalGas has recorded estimated leak costs of $330 million, with a $325 million insurance receivable and a $274 million reserve. Management stated that costs not covered by insurance could have a material adverse effect, and the Aliso Canyon facility (63% of SoCalGas's owned storage) has a $243 million net book value that could face impairment if it remains out of service. Beyond the leak, the filing highlights a large capital program, with roughly $5.1 billion of expected 2016 capital expenditures and investments, and the Cameron LNG liquefaction project (about $7 billion incremental, with Sempra guaranteeing $3.7 billion of project debt). Balance-sheet and liquidity indicators remain solid: investment-grade ratings (BBB+ at Sempra, A1 at the utilities), $3.7 billion of available unused credit, and a board-approved dividend increase to $0.755 per quarter ($3.02 annualized). Key regulatory items include the 2016 General Rate Case settlements, SDG&E's roughly $379 million wildfire cost recovery request, and pending CPUC action on the SONGS settlement.
Feb 26, 2016
2014
Sempra Annual Report, Year Ended Dec 31, 2014
Sempra Energy's 2014 combined Form 10-K (filed with SDG&E and SoCalGas) reports a year of higher earnings and a clear strategy centered on regulated utilities and contracted infrastructure. Sempra reported 2014 earnings of $1.161 billion, up 16% from 2013, and diluted EPS of $4.63 versus $4.01. Growth came from lower SONGS-related charges, higher CPUC-authorized base operating margin from the 2012 General Rate Case, a gain on Sempra Renewables' partial equity sales, and a Louisiana tax valuation allowance release tied to Cameron LNG. Consolidated revenues rose to $11.0 billion, and operating cash flow was $2.2 billion against $3.1 billion of capital expenditures, leaving the company reliant on debt and asset sales to fund its build-out. The filing's central investor story is the transition to large-scale LNG and infrastructure development. Cameron LNG Holdings, a joint venture Sempra now accounts for under the equity method, reached final investment decision and financial close in 2014 for a three-train liquefaction project with a roughly $7 billion incremental investment. Sempra guaranteed 50.2% of up to $7.4 billion of project debt, or up to $3.7 billion, which is a significant contingent exposure. Management expects its earnings and effective tax rate to rise over 2015 through 2019 as Cameron and other projects come online, with an effective rate guided to about 29% in 2015. Key risks flagged in the filing include regulatory outcomes at the California Utilities (pipeline safety cost recovery, electric rate reform under AB 327, and roughly $373 million of wildfire-related regulatory assets that require future CPUC approval), exposure to Mexican and South American currencies, LNG project execution and contractor risk, weak long-term natural gas storage economics, and the Rockies Express pipeline's contract roll-off in 2019. Management also highlights a dividend increase to $0.70 per quarter for 2015, investment-grade credit ratings maintained, and a $4.5 billion aggregate guarantee exposure.
Feb 26, 2015
2013
Sempra Annual Report, Year Ended Dec 31, 2013
Sempra Energy's 2013 Form 10-K (combined filing with SDG&E and SoCalGas) shows a year of solid earnings growth driven by the California utilities and a major financing and asset-recycling program. Consolidated earnings rose 17% to $1.0 billion, and diluted EPS increased to $4.01 from $3.48, though 2012 comparisons were distorted by a $239 million after-tax Rockies Express impairment. Revenues reached $10.6 billion, up about 9%, while total debt-to-capitalization improved to 52% from 55%. The 2012 General Rate Case final decision, approved in May 2013 and effective retroactively to January 1, 2012, contributed meaningful one-time earnings at both utilities, and SoCalGas and SDG&E together generated the majority of company earnings. The most significant negative item for investors is SDG&E's 20% interest in the San Onofre Nuclear Generating Station, which Edison decided in June 2013 to permanently retire. Sempra recorded a $200 million pretax ($119 million after-tax) loss from plant closure, and the remaining regulatory asset of $303 million depends on future CPUC decisions in the ongoing Order Instituting Investigation. SDG&E also carries roughly $330 million of regulatory assets tied to 2007 wildfire litigation costs in excess of insurance, and recovery requires future regulatory approval. Management expects SoCalGas to limit dividends to fund capital projects, and SDG&E did not pay common dividends in 2013. Looking forward, Sempra is pursuing growth through the Cameron LNG liquefaction project (an estimated $6 to $7 billion incremental investment, with a 50.2% stake), Mexican pipeline construction through IEnova (which sold 18.9% of its shares in March 2013 for $574 million net), and renewables. Capital expenditures are expected to be about $3.2 billion in 2014, with the California Utilities accounting for $2.2 billion. The board raised the quarterly common dividend to $0.66 per share in February 2014. The company also reported approximately $814 million of cash held in non-U.S. jurisdictions that is not immediately available for U.S. operations without repatriation.
Feb 27, 2014
2012
Sempra Annual Report, Year Ended Dec 31, 2012
Sempra Energy's 2012 Form 10-K (combined with SDG&E and SoCalGas) reports GAAP earnings of $859 million, or $3.48 diluted EPS, down 35% from $1.33 billion ($5.51 diluted) in 2011. The decline was driven mainly by a $239 million after-tax noncash impairment on its Rockies Express Pipeline investment (a $400 million pretax write-down), the absence of the $277 million non-taxable remeasurement gain booked in 2011 on the South American utilities, and a sharp drop in Sempra Natural Gas earnings after the DWR power contract expired in September 2011. The California Utilities (SDG&E and SoCalGas) were the most stable contributors, with combined earnings of about $773 million, and improved on lower tax expense from a change in the tax treatment of capitalized repairs. Key risks for investors center on SONGS, where the 20% SDG&E-owned Units 2 and 3 have been offline since early 2012 and face a CPUC Order Instituting Investigation that could force SDG&E to refund revenues collected since January 2012 or remove SONGS from rate base; SDG&E also carries roughly $2.4 billion of estimated 2007 wildfire settlement and defense costs, with about $364 million of regulatory assets dependent on future CPUC recovery approval. On the growth side, Sempra plans roughly $3.3 billion of 2013 capital spending and a Cameron LNG liquefaction project estimated at $6-7 billion, while the board raised the quarterly dividend to $0.63 per share. Leverage has risen, with the debt-to-capitalization ratio at 55% consolidated, and management indicates SoCalGas dividends may be reduced or suspended over the next few years to fund capital programs. Credit ratings remained investment grade at year-end 2012.
Feb 26, 2013
2011-A2
Sempra Annual Report (Amendment), Year Ended Dec 31, 2011
This filing is a Form 10-K/A Amendment (Item 15 exhibits index) from Sempra Energy (SRE), dated March 28, 2012, that primarily serves to add the financial statements of RBS Sempra Commodities LLP under Rule 3-09 of Regulation S-X. The core Sempra 2011 financial statements were not included here; they were previously filed as Exhibit 13.1 to the original 10-K filed February 28, 2012. For investors, this document is therefore mainly an administrative and supplemental filing rather than a source of new Sempra operating or earnings results. The most material content concerns Sempra's former 50% joint venture, RBS Sempra Commodities LLP (RBSSC). Its 2011 statements, prepared on a liquidation basis and unaudited, show net assets in liquidation of $238.8 million at December 31, 2011, down from $1,651.1 million a year earlier, after $1.39 billion of distributions to members during 2011. The partnership recorded a 2011 net loss of $13.8 million, and it expects liquidation to be substantially complete by the end of 2012. The sale of its trading businesses to JP Morgan, Noble, and Societe Generale in 2010 and 2011 effectively wound down Sempra's commodity trading exposure, which had been a significant source of volatility in prior years. Investors should note that the RBSSC liquidation implies a reduced earnings contribution from commodities trading going forward, and that Sempra's residual exposure is primarily through its indemnity and guarantee arrangements with RBS and the risk-transfer agreements with JP Morgan. The filing discloses no material new liabilities for Sempra itself, but the financial statements presented are unaudited, which limits the level of assurance they provide.
Mar 28, 2012
2011-A
Sempra Annual Report (Amendment), Year Ended Dec 31, 2011
This filing is Amendment No. 1 to the combined 2011 Form 10-K of Sempra Energy (SRE), San Diego Gas & Electric Company, and Southern California Gas Company. Its sole purpose, per the explanatory note, is to furnish the Interactive Data Files (XBRL Exhibits) under Exhibit 101. The XBRL exhibits were inadvertently filed under Exhibit 100 in the original 10-K, which was filed February 28, 2012. The amendment makes no other changes and does not update any disclosures or reflect subsequent events. The document supplied contains no financial statements, results of operations, or management discussion. Those are incorporated by reference from the 2011 Annual Report to Shareholders (Exhibit 13.1), which was not included in the text provided. For investors, the filing's main substance is administrative. It confirms Sempra's status as a large accelerated filer and well-known seasoned issuer, reports an aggregate non-affiliate market value of about $12.6 billion as of June 30, 2011, and lists 240,590,672 common shares outstanding as of February 24, 2012. SDG&E and SoCalGas are wholly owned subsidiaries and have no public market value. The filing also updates the exhibit index, including several 2011 agreements such as the October 12, 2011 amendments to SDG&E's nuclear decommissioning trust agreements. Investors seeking operating or financial performance should consult the original February 28, 2012 10-K and its Annual Report exhibit. Note: the filing date of March 14, 2012 provided in the request does not appear in the document text. The original combined 10-K is dated February 28, 2012, per the explanatory note.
Mar 14, 2012
2011
Sempra Annual Report, Year Ended Dec 31, 2011
Sempra Energy's 2011 combined Form 10-K (filed with SDG&E and SoCalGas) shows a year of strong reported earnings, driven largely by a non-recurring $277 million pre-tax, non-taxable remeasurement gain on its South American utilities. Consolidated earnings attributable to common shares rose to $1,357 million ($5.62 diluted EPS) from $739 million ($2.98) in 2010, which was depressed by a $305 million pre-tax RBS Sempra Commodities write-down and $159 million of energy crisis litigation charges. Excluding these items, underlying performance was improved at the Sempra Utilities, Sempra LNG and Sempra Pipelines & Storage, while Sempra Generation earnings fell as its DWR power contract expired on September 30, 2011. The key forward-looking investor issues are regulatory and capital-intensity. The 2012 General Rate Case requests for SDG&E ($235 million increase, 14.6%) and SoCalGas ($268 million increase, 14.5%) face opposition from ratepayer advocates seeking roughly a 5% cut, and a material reduction would hurt 2012 cash flows. Capital spending is heavy: about $2.8 billion in 2011 and roughly $3.1 billion planned for 2012, with a five-year utility plan of $5.8 billion at SDG&E and $5.0 billion at SoCalGas. SoCalGas expects its dividends to be reduced or suspended for several years, and SDG&E does not expect to pay common dividends to Sempra in 2012. Sempra's dividend was nonetheless raised to $0.60 per quarter in February 2012. SDG&E also carries material legal and operational exposure: the 2007 San Diego County wildfire claims produced a $594 million regulatory asset that depends on future CPUC recovery, and the September 2011 outage and the SONGS steam generator leak in January 2012 are open risks. The company's effective tax rate is expected to rise to about 29% in 2012 because of a change in how solar investment tax credits are recognized, which lowers near-term reported net income by about $26 million in 2011 on a retroactive basis.
Feb 28, 2012
2010-A
Sempra Annual Report (Amendment), Year Ended Dec 31, 2010
This filing is Sempra Energy's (SRE) Form 10-K/A filed March 31, 2011, and it is an exhibit-focused amendment rather than a full annual report. The Sempra 2010 financial statements were already filed with the original 10-K on February 24, 2011, so the amendment's main purpose is to add Rule 3-09 financial statements for RBS Sempra Commodities LLP (RBSSC), an unconsolidated 50/50 joint venture with The Royal Bank of Scotland. Investors should therefore read this filing as a supplement covering the joint venture, not as a source of new consolidated Sempra results, segment data, or guidance. The most material content is the RBSSC financial data. As of December 31, 2010, RBSSC reported net assets in liquidation of about $1.65 billion, against total assets of $4.55 billion and total liabilities of $2.90 billion. For 2010 it recorded a net loss of $168.8 million, driven by a $154.9 million net loss on disposal activities, which included $215.9 million of disposal costs. The partnership adopted liquidation-basis accounting effective December 31, 2010, after selling substantially all of its operations to JP Morgan and Noble Group. Those sales brought in roughly $1.6 billion, $318 million, and about $9 million for the Oil, Metals and European Power and Gas business, the Sempra Energy Solutions business, and the North American Power and Gas trading book respectively. Distributions to members totaled $1.86 billion in 2010. For Sempra, the practical implication is that the joint venture has effectively wound down, with remaining residual assets and risk-transfer arrangements expected to be finalized by the third quarter of 2011. The filing also confirms Sempra's ongoing indemnity and guarantee exposure tied to the joint venture, including a guarantee of certain non-novated counterparties and RBS's indemnity back to Sempra. It lists the existing contract and compensation exhibits, but it does not disclose new consolidated financials in this document. Investors should note that the joint venture's wind-down reduces Sempra's future exposure to the commodity trading business, but the amendment itself is a limited-scope filing.
Mar 31, 2011
2010
Sempra Annual Report, Year Ended Dec 31, 2010
Sempra Energy's 2010 combined Form 10-K (filed February 24, 2011, jointly with SDG&E, Pacific Enterprises and SoCalGas) reports consolidated 2010 earnings attributable to common shares of $739 million, or $2.98 diluted EPS, down from $1,119 million ($4.52) in 2009. The decline was driven primarily by a $139 million after-tax write-down of the investment in RBS Sempra Commodities, $87 million and $6 million of after-tax energy crisis litigation expense at Sempra Generation and Sempra Commodities, and a negative $314 million pretax equity result from the RBS joint venture. Partially offsetting these were improved results at Sempra Pipelines & Storage ($159 million vs. $101 million), Sempra LNG ($68 million vs. $16 million) and the Sempra Utilities, where SDG&E earned $369 million and SoCalGas $286 million. The company is largely exiting its commodities-marketing business. Sempra and RBS divested substantially all of the RBS Sempra Commodities businesses in 2010 and early 2011, and Sempra expects its share of total proceeds to be $1.8 billion to $1.9 billion, of which about $1 billion had been received by year-end. Management also flagged a sizable earnings headwind ahead: Sempra Generation's contract with the California Department of Water Resources, which contributed 8% of 2010 revenues, expires in September 2011, and replacement contracts are expected to produce substantially lower earnings at current market prices. Capital intensity is high, with about $3.8 billion of planned 2011 capital expenditures and roughly $5 billion of planned spending at the non-utility businesses over five years, including the roughly $875 million acquisition of AEI's interests in Chilquinta Energía and Luz del Sur. The utilities face important regulatory events. SDG&E and SoCalGas filed 2012 General Rate Case requests, and bonus depreciation under the 2010 Tax Act is expected to reduce their rate base and the revenue increases ultimately approved. SDG&E also carries significant contingent exposure from the October 2007 San Diego County wildfires, where its settlements and estimated claims (about $1.9 billion) exceed its $1.1 billion of liability insurance. Management believes the excess is probably recoverable from customers, so it expects no significant earnings impact, though cash flow timing and the need for future regulatory approval remain risks. The board raised the quarterly dividend to $0.48 per share, targeting a 45% to 50% payout ratio.
Feb 24, 2011
2009
Sempra Annual Report, Year Ended Dec 31, 2009
Sempra Energy's 2009 combined Form 10-K (filed February 26, 2010) covers Sempra Energy and its subsidiaries SDG&E, Pacific Enterprises and SoCalGas. Sempra reported 2009 earnings of $1,119 million, or $4.52 diluted EPS, essentially flat with $1,113 million ($4.43) in 2008, on total revenues of $8.1 billion, down from $10.8 billion as natural gas prices fell sharply. Utility earnings rose, with SDG&E at $344 million and SoCalGas at $273 million, while the Sempra Global businesses were mixed: Sempra Generation fell to $162 million, Sempra Commodities held at $345 million through its equity stake in RBS Sempra Commodities, and Sempra LNG swung to a $16 million profit. Parent and other losses widened to $122 million on higher interest expense. The central investor issue is the pending sale of RBS Sempra Commodities businesses to J.P. Morgan Ventures, agreed February 16, 2010 and expected to close in Q2 2010. Sempra expects proceeds of roughly $835 million, but the businesses being sold have historically generated 40 to 60 percent of the partnership's earnings, so Sempra's future equity earnings from the joint venture are likely to fall materially. Sempra is also exposed to SDG&E's 2007 wildfire litigation, where remaining insurance coverage is about $20 million after homeowner-insurer settlements and remaining unreserved claims are expected to substantially exceed insurance. Sempra intends to seek recovery of excess amounts from customers, but that outcome is uncertain. Longer term, Sempra plans substantial capital spending, about $3 billion in 2010 and roughly $11 billion over five years, funded by operations and debt. Key growth projects include the Sunrise Powerlink transmission line, Cameron and Energia Costa Azul LNG terminals, natural gas storage, and renewable generation. The company is also reducing exposure to Sempra Generation's DWR power contract, which expires in late 2011 and is expected to produce lower earnings on replacement contracts. Credit ratings remained investment grade, with a negative Fitch watch tied to the RBS joint venture.
Feb 26, 2010
2008
Sempra Annual Report, Year Ended Dec 31, 2008
Sempra Energy's FY2008 10-K (combined filing with SDG&E, Pacific Enterprises and SoCalGas) shows a company in transition: a largely regulated utility core, a restructured commodities business, and a growing but capital-intensive non-utility infrastructure build-out. Consolidated 2008 revenues were $10.8 billion (down from $11.4 billion) and net income was $1.113 billion, flat with 2007 at $1.099 billion, while diluted EPS rose to $4.43 from $4.16, helped by the $1 billion share repurchase that cut shares outstanding from roughly 261 million to 243 million. Income from continuing operations declined in underlying terms because the April 2008 formation of the RBS Sempra Commodities joint venture reduced Sempra's share of commodities-marketing earnings to equity-method treatment, which contributed $383 million of pretax equity earnings and a $67 million after-tax gain. The Sempra Utilities (SDG&E and SoCalGas) delivered the steadiest results: SDG&E net income rose 20% to $339 million and SoCalGas rose 6% to $244 million, supported by the 2008 General Rate Case that sets rates for 2008 through 2011 with roughly 3% annual revenue increases. Sempra Generation (net income $222 million) and Sempra Pipelines & Storage ($106 million) improved, while Sempra LNG remained loss-making ($46 million loss) ahead of the Cameron and Energia Costa Azul terminals. Balance-sheet leverage increased: long-term debt rose to about $6.5 billion from $4.6 billion, and the debt-to-capitalization ratio at the consolidated level was about 47%. Investors should weigh several concentrated risks: the DWR power contract with Sempra Generation (roughly 10% of revenues) expires in 2011 and is subject to ongoing litigation; SDG&E faces numerous lawsuits from the October 2007 San Diego wildfires with liability insurance of $1.1 billion; the RBS joint venture depends on RBS's capital support, which is under strain after RBS came under UK government control; and large capital programs (about $2.5 billion planned for 2009, including $1.2 billion at non-utility subsidiaries) must be financed in tight credit markets. The board also raised the quarterly dividend to $0.39 per share in February 2009.
Feb 24, 2009
2007
Sempra Annual Report, Year Ended Dec 31, 2007
Sempra Energy's 2007 10-K shows a company with strong utility earnings, a large but volatile trading business being moved to a joint venture, and a significant LNG and pipeline development pipeline. Consolidated net income fell 22% to $1.10 billion ($4.16 diluted EPS) from $1.41 billion in 2006, but that comparison is distorted by 2006 asset-sale gains. Income from continuing operations rose 3% to $1.125 billion, led by higher earnings at SDG&E, and total operating revenues were $11.4 billion. Sempra Utilities net income rose to $513 million, and Sempra Global net income was $679 million. The central strategic event is the pending transfer of Sempra Commodities to a partnership with The Royal Bank of Scotland (RBS Sempra Commodities LLP), expected to close in April 2008. Sempra's equity investment has been raised to $1.6-1.7 billion, and the company expects roughly $1 billion of net cash proceeds at closing. RBS will assume credit support for the trading business, removing a major source of liquidity demands tied to Sempra's credit ratings. Management plans to fund a $1 billion share buyback afterward and to raise the quarterly dividend to $0.35 from $0.32. Risks remain material: a large litigation reserve base tied to the 2000-2001 California energy crisis, a pending Sunrise Powerlink transmission decision, a DWR power contract dispute, and multi-billion-dollar LNG and pipeline commitments. For investors, the filing presents a utility-anchored company that is de-risking its trading operations, with growth depending on successful execution of the Energía Costa Azul and Cameron LNG terminals and the Rockies Express pipeline, all expected to come online in 2008-2009.
Feb 26, 2008
2006
Sempra Annual Report, Year Ended Dec 31, 2006
Sempra Energy's 2006 Form 10-K (filed February 23, 2007) reports a strong year driven by non-recurring gains and lower litigation expense. Operating revenues rose 2% to $11.8 billion, operating income climbed 64% to $1.785 billion, and net income increased 53% to $1.406 billion (diluted EPS $5.38, up 47%). Continuing operations earned $1.091 billion, while the reported figures include $315 million from discontinued operations, mainly the sales of Twin Oaks, SEPCO, and the energy-services businesses. Major 2006 gains included the Topaz power plant sale (about $204 million after tax), with partly offsetting charges such as a $221 million impairment on the Argentine utility investments that Sempra decided to sell in December 2006. The Sempra Utilities (SoCalGas and SDG&E) remain the stable earnings base, with combined net income of $460 million, down from $473 million, reflecting the Palomar plant transfer to SDG&E and higher operating costs. Sempra Global is the main source of volatility: Sempra Commodities earned $504 million, while Sempra Pipelines & Storage posted a $165 million loss after its impairment. Management is pursuing a capital program of about $2.1 billion in 2007 and roughly $6.6 billion at the utilities over five years, mainly for LNG terminals (Energia Costa Azul, Cameron, Port Arthur), the Rockies Express pipeline, and the Sunrise Powerlink transmission line. Balance sheet metrics are sound: shareholders' equity rose to $7.5 billion, book value reached $28.67 per share, and the debt-to-capitalization ratio was 41 percent. Investors should weigh ongoing exposure to California energy-crisis litigation (about $621 million in litigation reserves), the DWR contract dispute, and the Argentine write-down.
Feb 23, 2007
2005
Sempra Annual Report, Year Ended Dec 31, 2005
Sempra Energy (SRE) reported 2005 results that were solidly profitable at the bottom line but heavily affected by a large one-time charge tied to California energy crisis litigation. Net income rose 2.8% to $920 million, while diluted EPS fell 4.7% to $3.65, largely because of roughly 19.7 million shares issued in 2005 to settle the 2002 Equity Units. Operating income fell to $1,111 million from $1,281 million, primarily due to a $551 million litigation expense, which included an after-tax $116 million charge recorded in Q4 2005 to fund settlements of the Continental Forge and Nevada antitrust cases. Operating revenues grew about 24% to $11.7 billion, driven by higher natural gas prices and strong trading results at Sempra Commodities, which earned $460 million of net income, up from $320 million. The earnings mix is a key investor takeaway. The California Utilities (SoCalGas and SDG&E) produced about $473 million of net income, which provides relatively stable, regulated earnings. Sempra Commodities, a volatile trading business, now contributes about half of consolidated net income, which raises the importance of its credit rating, margin requirements and liquidity. The filing notes that a ratings downgrade could trigger collateral calls and constrain trading. Other items to watch include the DWR power contract dispute, the Argentine investment arbitration, several unresolved energy-crisis lawsuits, and capital spending plans of roughly $2.3 billion in 2006 focused on LNG terminals and California utility infrastructure. Shareholders' equity rose to $6.16 billion, and book value per share increased to $23.95. The board also approved a quarterly dividend increase to $0.30 per share. Overall, the 2005 results reflect strong operating performance outside the litigation charge, but earnings quality depends on volatile trading income and on the outcome of several large legal and regulatory matters. Investors should weigh the expected settlement payments, the DWR arbitration, and the sustainability of trading margins when assessing the company's outlook.
Feb 23, 2006
2004
Sempra Annual Report, Year Ended Dec 31, 2004
Sempra Energy's 2004 Form 10-K shows a strong year driven by its non-utility businesses. Net income rose 37.9% to $895 million, and diluted EPS rose 26.4% to $3.83 (up from $3.03). Operating revenues increased to $9.41 billion from $7.89 billion, and operating income to $1.27 billion from $939 million. Sempra Commodities (net income $320 million, up from $157 million) and Sempra Generation ($137 million, up from $71 million) drove most of the gain, aided by market volatility and higher volumes under the DWR power contract. The California Utilities earned $440 million, down from $543 million, largely because of 2003 one-time items and lower SDG&E earnings after SONGS ratemaking changed. Management also raised the quarterly dividend to $0.29 from $0.25 and reported book value per share of $20.77, up from $17.17. The main risks are litigation and regulatory exposure. Plaintiffs in the California energy crisis antitrust case against Sempra and the California Utilities have claimed damages of up to $24 billion, with trial set for September 2005. The DWR contract for 1,900 MW is under appeal and arbitration, and FERC refund and manipulation proceedings remain open. Sempra Commodities' earnings are volatile and depend on its credit rating, and the company's LNG build-out (Energia Costa Azul, Cameron, Port Arthur) requires large capital commitments, with 2005 capex expected at $1.6 billion. Debt-to-capitalization was 49%, and the company reported $419 million of unrestricted cash and $4.5 billion of unused committed credit lines.
Feb 23, 2005
2003
Sempra Annual Report, Year Ended Dec 31, 2003
Sempra Energy's fiscal 2003 10-K reports net income of $649 million, up 9.8% from $591 million in 2002, with diluted EPS of $3.03 (up 5.6%). Operating income declined to $939 million from $987 million, so the earnings gain was driven largely by unusual items rather than core operations. The biggest one-time boosts were $118 million from favorable resolution of IRS income-tax issues and $65 million after-tax from the CPUC-approved SDG&E intermediate-term power contract settlement. Offsetting charges included a $77 million pre-tax Frontier Energy write-down, a $24 million AEG write-down, and $85 million of pre-tax California energy crisis litigation and SoCalGas sublease costs. Excluding these items, the filing indicates core operations were modestly higher in 2003 (roughly $53 million net income improvement, though operating income was down). The California Utilities (SoCalGas and SDG&E) remain the stable earnings base, contributing $543 million of net income, while Global Enterprises contributed $209 million, with Sempra Energy Trading (SET) earnings falling to $98 million and Sempra Energy Resources (SER) rising to $94 million on DWR contract volumes and new plants. Total assets grew to $22.0 billion, shareholders' equity rose to $3.89 billion after a $448 million common stock offering, and book value per share increased to $17.17. Debt-to-capitalization was 55%, and credit ratings were lowered during 2003 but remain investment grade with stable outlooks. Key risks for investors include the DWR power contract (up to 1,900 MW, under appeal), pending antitrust and market-manipulation litigation tied to the California energy crisis, FERC refund and gaming proceedings, the IRS audit of synthetic fuel tax credits (cumulative $256 million recorded), and the potential impact of a credit-rating downgrade on SET's trading business. Growth depends on new projects, including the Mesquite, TDM, and Elk Hills plants, the planned Palomar plant, and LNG terminals in Mexico and Louisiana, which carry execution and permitting risk.
Feb 25, 2004
2002
Sempra Annual Report, Year Ended Dec 31, 2002
Sempra Energy's 2002 Form 10-K shows a company with improving earnings and a heavy growth agenda, anchored by its California utilities. Consolidated net income rose to $591 million, or $2.87 per diluted share, from $518 million ($2.52) in 2001. Operating revenues fell to $6.02 billion from $7.73 billion, largely because natural gas and electric commodity prices dropped and the state's Department of Water Resources (DWR) took over SDG&E's power purchases, which removed those costs and revenues from Sempra's income statement. Operating income was roughly flat at $987 million. Earnings were helped by lower income taxes (effective rate 20.2% vs. 29.1%), lower interest expense, and a $16 million extraordinary gain tied to Sempra Energy Trading's acquisitions of metals businesses. Sempra Energy Resources (SER), the power-plant developer, swung to $60 million of net income from a $27 million loss, mainly because its DWR contract sales resumed at favorable rates. The main investor issues are regulatory and concentration risk. The California utilities remain the base of earnings, but their results depend on CPUC and FERC decisions on electric rate recovery, the AB 265 undercollection, the profit-sharing dispute over SDG&E's power contracts, and the natural gas industry restructuring that has been delayed. SER's large DWR contract, which supplies up to 1,900 MW for ten years, is under legal challenge from California and the DWR itself, and it is central to the company's earnings growth. Sempra Energy Trading's earnings are volatile and tied to energy market swings, and the company faces a sizable pipeline of new projects, including about $1.3 billion of planned 2003 capital expenditures and a $600 million Baja California LNG terminal. On the balance sheet, total assets grew to $17.8 billion, long-term debt rose to $4.1 billion, and the debt-to-capitalization ratio stood at 59%. Shareholders' equity was $2.8 billion, or $13.79 book value per share. Management reports $455 million in cash and $2.25 billion of unused credit lines, and it issued $600 million of equity units in 2002 and $400 million of 6% notes in early 2003. The company also faces Argentine currency losses that reduced equity by $223 million, with an international arbitration claim pending. Overall, the filing points to solid recovery in earnings but significant regulatory and project-execution risk.
Feb 26, 2003
2001
Sempra Annual Report, Year Ended Dec 31, 2001
Sempra Energy's 2001 Form 10-K shows a company whose results rose sharply on the back of its energy trading unit, while its California utilities remain under heavy regulatory and financial strain from the 2000-2001 electricity crisis. Consolidated net income increased to $518 million ($2.52 per diluted share) from $429 million ($2.06) in 2000, and operating revenues rose to $8.0 billion from $7.0 billion. Sempra Energy Trading (SET) earned $196 million, driven by volatile energy markets in the first half of 2001 and higher trading volumes, while the California utilities' base earnings are expected to drive the company's core results going forward. Growth-oriented businesses were mixed: Sempra Energy Resources posted a $27 million net loss due to discounted power sales to the California Department of Water Resources (DWR), and International operations earned $25 million after a $25 million after-tax charge for surrendering its Nova Scotia gas franchise. The key risk for investors is the regulatory outcome in California. In January 2002 the CPUC rejected the part of the June 2001 Memorandum of Understanding that would have let SDG&E keep profits on its favorably priced electricity purchase contracts; the CPUC estimates those profits at $363 million, versus the $219 million credit contemplated by the MOU. SDG&E is pursuing appeals and a federal lawsuit, and the timing of resolution will affect its cash flows. The DWR contract, which covers up to 1,900 MW, has also been challenged by state officials, who asked FERC in February 2002 to abrogate or reform the rates. Sempra's credit ratings carry negative outlooks from S&P and Moody's, and SDG&E's carry negative outlooks from all three agencies. Leverage is elevated, with debt at about 60% of total capitalization. On the growth side, Sempra has about $1.1 billion of capital expenditures in 2001 and expects a significantly higher level in 2002, including roughly $1.5 billion for California utility plant and SER power plant construction. Major projects include the 600 MW Termoelectrica de Mexicali, the 1,200 MW Mesquite Power Plant, and the 570 MW Elk Hills project, with the North Baja Pipeline due for completion in summer 2002. Liquidity appears adequate, with $605 million in cash and $2.5 billion in unused committed credit lines at year-end 2001. Management expects capital expenditures to be partly financed through new securities issuances.
Mar 19, 2002
2000
Sempra Annual Report, Year Ended Dec 31, 2000
Sempra Energy's FY2000 10-K reveals a company whose results were strong at the consolidated level but whose core California utility franchise faced serious financial stress. Net income rose 9% to $429 million ($2.06 per diluted share) from $394 million ($1.66), driven mainly by Sempra Energy Trading (net income of $155 million vs. $19 million), with El Dorado Energy and international operations also contributing. Revenues and other income climbed to $7.1 billion from $5.4 billion, largely from trading and higher gas prices passed through to customers. The central investor concern is the California electricity crisis. Under AB 265, SDG&E's small-usage customers face a 6.5 cent/kWh commodity rate ceiling, while wholesale costs ran far higher (15.51 cents/kWh in the second half of 2000). Undercollected costs reached $447 million at year-end 2000 and $605 million by January 31, 2001, and the filing expects them to reach about $700 million in March 2001. SDG&E has fully drawn its short-term credit lines, and the company drew down substantially all of its $1.3 billion in available credit facilities in late January and early February 2001. Credit rating agencies have moved outlooks to negative. The state's AB 1 authorization for the Department of Water Resources to buy power for SDG&E customers is intended to halt the growth of undercollections, but the outcome depends on pending CPUC decisions and legislation. Capital structure also changed materially. Sempra repurchased 36.1 million shares at $20 in a February 2000 self-tender, cutting shareholders' equity to $2.49 billion from $2.99 billion and lifting the debt-to-capitalization ratio to 59%. The quarterly dividend fell to $0.25 from $0.39, and annual dividends declared dropped to $1.00 from $1.56. Management plans significant growth capital, including $1.9 billion over five years for power plants, and is pursuing international gas distribution projects in Latin America and Nova Scotia.
Mar 13, 2001
1999
Sempra Annual Report, Year Ended Dec 31, 1999
Sempra Energy's 1999 Form 10-K reports net income of $394 million, or $1.66 per diluted share, up from $294 million ($1.24) in 1998, with total revenues and other income of $5.435 billion. Results were driven mainly by lower business-combination costs at the California utilities, stronger contributions from Sempra Energy Trading (net income $19 million), Sempra Energy Financial, and Sempra Energy International, which swung to a $10 million profit. Operating income rose to $802 million from $629 million. The 1999 figures also include a $303 million depreciation effect tied to the sale of SDG&E's fossil plants, which generated $466 million in net proceeds, and a $80 million quasi-reorganization credit to equity. The more consequential story for investors is the capital structure shift announced after year-end. In February 2000 Sempra repurchased roughly 36 million shares (about 15% of outstanding stock) at $20 per share through a Dutch auction tender, funded by $700 million of new senior notes and trust-preferred securities plus commercial paper. The quarterly dividend was cut 36% to $0.25 per share ($1.00 annualized) from $0.39. Management states the debt-to-capitalization ratio would have been 62% on a pro forma basis, up from 50%, and says it expects to maintain strong investment-grade ratings, which the agencies reaffirmed. Management also targets generating one-third of consolidated earnings from unregulated businesses by 2003, though it cautions that this cannot be assured. Risks flagged in the filing include regulatory uncertainty in California (pending CPUC decisions on ending the electric rate freeze, natural gas industry restructuring, and BCAP rates, with a proposed $208 million SoCalGas revenue decrease), a potential refund of over $400 million to SDG&E ratepayers from rate-reduction bond overcollections, roughly $70 million of environmental remediation liabilities (about 90% recoverable through rates), and the volatility inherent in energy trading, where SET's counterparty exposure includes $116 million rated below investment grade. The company also reports no material pending litigation.
Mar 29, 2000
1998
Sempra Annual Report, Year Ended Dec 31, 1998
Sempra Energy's 1998 10-K describes a company formed on June 26, 1998 from the merger of Pacific Enterprises (SoCalGas parent) and Enova Corporation (SDG&E parent). Reported results were weaker than 1997: net income fell to $294 million ($1.24 diluted EPS) from $432 million ($1.82), driven mainly by $85 million after-tax of business-combination costs, a lower base margin under SoCalGas' Performance-Based Regulation decision, and start-up losses at Sempra Energy Solutions ($27 million) and Sempra Energy Trading (net loss of $13 million after acquisition-cost amortization). Total revenues rose to $5.5 billion, helped by $500 million of PX/ISO power sales, while operating income fell to $639 million from $939 million, with depreciation and amortization up sharply to $929 million due to recovery of stranded costs. Book value per share declined to $12.29 and the debt-to-capitalization ratio improved to 50% from 54%. The core utility businesses remain the foundation of the company. SoCalGas is the nation's largest gas distribution utility, and SDG&E is in the middle of California's electric restructuring. SDG&E has agreed to sell its South Bay and Encina plants and 17 combustion turbines for roughly $466 million combined, with closings expected in the first half of 1999, and its rate freeze and stranded-cost recovery remain key uncertainties. Capital expenditures are estimated at $419 million for the utilities in 1999, and dividends were raised to $1.56 per share in 1998 on the Enova-equivalent basis. The most significant forward-looking item is the February 22, 1999 agreement to acquire KN Energy for about $1.7 billion, payable in stock (1.115 Sempra shares per KN share) or $25 in cash, with cash capped at 30% of consideration. The deal requires shareholder and regulatory approval and is expected to close in six to eight months. Investors should weigh the earnings pressure in 1998, the Year 2000 budget of $48 million, and the regulatory and integration risks of the KN transaction.
Mar 9, 1999