What was Sempra Energy's financial performance in the first quarter of 2008?

Sempra Energy reported a net income of $242 million for the first quarter of 2008, an increase from $228 million in the same period of 2007. Diluted earnings per share were $0.92, up from $0.86 in the prior year. Total operating revenues rose to $3.27 billion.

How did the different business segments perform?

The Sempra Utilities (SoCalGas and SDG&E) showed improved net income, driven by higher energy prices and volumes. Sempra Commodities' net income decreased due to factors like a credit provision and higher taxes, despite higher reported margins. Sempra Generation also saw a decrease in net income, while Sempra Pipelines & Storage reported higher net income due to new project contributions and favorable currency effects.

What is the company's liquidity position?

As of March 31, 2008, Sempra Energy had $806 million in unrestricted cash and cash equivalents and $4.3 billion in available, unused committed lines of credit. Management believes these resources, combined with operational cash flows and potential security issuances, are sufficient to meet capital expenditures, liquidity needs, and shareholder distributions.

SRE/SREA 10-Q Quarterly Report Q1 FY2008 — Revenue, Net Income, EPS

Q: What are the significant strategic transactions completed or announced during the quarter?

The most significant transaction was the formation of RBS Sempra Commodities LLP on April 1, 2008, in partnership with The Royal Bank of Scotland. This transaction resulted in Sempra Energy receiving $1.2 billion in cash and retaining an equity investment in the new partnership, which now operates the commodity-marketing businesses. Additionally, Sempra Energy announced and began executing a $1 billion share repurchase program.

Summary

Sempra Energy (SRE) reported net income of $242 million for the first quarter of 2008, a slight increase from $228 million in the same period of 2007. Earnings per diluted share were $0.92, up from $0.86 in the prior year. The company saw revenue growth driven primarily by its utility segments (SoCalGas and SDG&E), which benefited from increased natural gas prices and volumes, as well as higher authorized transmission margins. However, Sempra Commodities experienced a decline in net income due to factors including a credit provision and higher income tax expense, despite reported margin increases. Significant developments during the quarter include the formation of RBS Sempra Commodities LLP on April 1, 2008, a partnership with The Royal Bank of Scotland, which involved Sempra Energy receiving $1.2 billion in cash and retaining an equity investment. Additionally, Sempra Energy announced a $1 billion share repurchase program. The company also provided updates on key regulatory matters, including the ongoing Sunrise Powerlink project and General Rate Cases for its utilities, with expected decisions later in the year. The company's balance sheet shows total assets of $29.85 billion and shareholders' equity of $8.58 billion.

Key Highlights

1Net income for Q1 2008 was $242 million, a 6% increase year-over-year, with diluted EPS at $0.92.
2Sempra Utilities (SoCalGas and SDG&E) showed improved performance driven by higher natural gas prices/volumes and transmission margins.
3Completed the formation of RBS Sempra Commodities LLP on April 1, 2008, receiving $1.2 billion in cash and an equity investment, and transitioning to the equity method of accounting for this business.
4Initiated a $1 billion share repurchase program, with $1 billion prepaid on April 7, 2008.
5Total operating revenues increased to $3.27 billion from $3.00 billion in the prior year's quarter.
6The company has $4.3 billion in unused, committed lines of credit available for liquidity and commercial paper support as of March 31, 2008.
7Significant capital expenditures of $544 million were made in investing activities, primarily for property, plant, and equipment.

SEMPRA Quarterly Report for Q1 Ended Mar 31, 2008

Summary

Key Highlights

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