10-KPeriod: FY2021

SEMPRA Annual Report, Year Ended Dec 31, 2021

Filed February 25, 2022For Securities:SRESREA

Summary

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.

Financial Highlights

45 data points
Beta

Revenue

$12.86B

Net Income

$1.32B

10.3% Net Margin

EPS (Diluted)

$2.01

Total Assets

$72.05B

Cash & Equivalents

$559.00M

Free Cash Flow

$3.84B

Financial Statements
Beta
Revenue$12.86B
Interest Expense$1.20B
Net Income$1.32B
EPS (Basic)$2.01
EPS (Diluted)$2.01
Shares Outstanding (Basic)623.51M
Shares Outstanding (Diluted)626.07M

Key Highlights

  • 1Sempra reported earnings attributable to common shares of $1,254 million in 2021, a significant decrease from $3,764 million in 2020, primarily due to a $915 million increase in charges related to civil litigation and regulatory matters for the SoCalGas Aliso Canyon leak.
  • 2SDG&E's earnings decreased slightly by $5 million to $819 million in 2021 compared to 2020, impacted by a regulatory liability release in the prior year and lower electric transmission margin.
  • 3Sempra Texas Utilities reported an increase in earnings of $37 million to $616 million in 2021, driven by higher equity earnings from Oncor Holdings due to rate updates and customer growth.
  • 4Sempra Infrastructure's earnings increased by $102 million to $682 million in 2021, primarily due to higher equity earnings from Cameron LNG JV achieving full commercial operations and improved asset and supply optimization.
  • 5The company invested $5.6 billion in capital expenditures and investments in 2021, with significant allocation towards Sempra California utilities for infrastructure improvements and wildfire safety.
  • 6Sempra Energy has a strategic focus on North America and has simplified its business model, including the consolidation of non-utility energy infrastructure assets under SI Partners.
  • 7The company's credit ratings for Sempra, SDG&E, and SoCalGas remained at investment grade levels throughout 2021, with stable or negative outlooks noted by rating agencies.

Frequently Asked Questions

In 2021, Sempra reported earnings attributable to common shares of $1,254 million, a decrease from $3,764 million in 2020. This decrease was primarily driven by a significant increase in charges related to the Aliso Canyon natural gas leak litigation and regulatory matters impacting SoCalGas, which amounted to $1,593 million in 2021 compared to $307 million in 2020.

Sempra Infrastructure's earnings increased by $102 million to $682 million in 2021. This improvement was mainly due to higher equity earnings from Cameron LNG JV, which achieved full commercial operations with all three trains in August 2020, and stronger performance in asset and supply optimization due to changes in natural gas prices and higher volumes.

Sempra's strategy focuses on being North America's premier energy infrastructure company, with primary emphasis on transmission and distribution investments. The company invested $5.6 billion in capital expenditures and investments in 2021, with significant allocations to Sempra California for infrastructure upgrades and wildfire mitigation, and ongoing development in Sempra Infrastructure. Future capital expenditures are expected to remain substantial, supporting growth and modernization across its segments.

Sempra highlighted several risks, including those related to California wildfires, regulatory changes (particularly at the CPUC), operational risks at its infrastructure projects, cybersecurity threats, foreign currency fluctuations, and the ongoing legal and financial implications of the Aliso Canyon natural gas leak at SoCalGas. The company also noted risks associated with its international operations, particularly in Mexico, due to evolving government policies and regulations.