Edison International(EIX) - 2024 Q2 - Quarterly Results

Edison International Q2 2024 Earnings Release Q2 2024 Financial Highlights Edison International reported strong second-quarter 2024 results, with both GAAP and Core EPS increasing year-over-year, driven by Southern California Edison's performance despite higher interest expenses Q2 2024 Key Financial Metrics | Metric | Q2 2024 | Q2 2023 | Change | | :--- | :--- | :--- | :--- | | Net Income | $439 million | $354 million | +$85 million | | GAAP EPS | $1.14 | $0.92 | +$0.22 | | Core Earnings | $475 million | $388 million | +$87 million | | Core EPS | $1.23 | $1.01 | +$0.22 | - Southern California Edison's (SCE) core EPS increased year-over-year, mainly due to higher authorized revenue, an increased authorized rate of return, and recognition of return on rate base for wildfire restoration efforts, partially offset by higher interest expense[1] - SCE has completed 84% of its planned hardening of distribution lines in high fire risk areas, marking a significant milestone in its wildfire mitigation efforts[18] 2024 Earnings Guidance and Outlook The company reaffirmed its full-year 2024 core EPS guidance and long-term growth targets, anticipating significant grid expansion due to projected load growth 2024 Core EPS Guidance (Reaffirmed) | Guidance Metric | Low | High | | :--- | :--- | :--- | | Core EPS | $4.75 | $5.05 | - The company reiterated its long-term core EPS growth rate targets of 5%-7% for the 2021-2025 period and 5%-7% for the 2025-2028 period[18] - SCE's latest 10-year forecast projects 35% higher load growth, which will require significant expansion of the electric system to ensure reliability and resilience[2] Share Repurchase Program The Board of Directors authorized a new stock repurchase program of up to $200 million to offset dilution from employee compensation programs - The Board authorized a stock repurchase program for up to $200 million of its common stock[3] - The program is effective from July 29, 2024, until December 31, 2025, and will be funded using the company's working capital[3] - The purpose of the repurchase is to offset dilution from common stock issued under the company's long-term incentive compensation programs, and the program may be suspended or discontinued at any time[3][20] Financial Statements and Reconciliations Reconciliation of GAAP to Non-GAAP Earnings This section details the reconciliation of GAAP earnings to non-GAAP core earnings, highlighting non-core items primarily related to wildfire claims and expenses EPS Reconciliation: GAAP vs. Core (Q2 & H1 2024) | Per Share Data | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | GAAP EPS | $1.14 | $1.11 | | Non-core Items | ($0.09) | ($1.26) | | Core EPS | $1.23 | $2.37 | Net Income Reconciliation: GAAP vs. Core (Q2 & H1 2024, in millions) | (in millions) | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net Income | $439 | $428 | | Non-core Items | ($36) | ($485) | | Core Earnings | $475 | $913 | - Non-core items for the six months ended June 30, 2024, included charges for wildfire claims and expenses, net of recoveries, totaling $478 million ($344 million after-tax)[16] Consolidated Statements of Income For the first half of 2024, operating revenue increased, but a significant rise in wildfire-related claims led to a decrease in net income available to common shareholders Consolidated Income Statement Highlights (in millions) | Metric | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | | Operating Revenue | $8,414 | $7,930 | | Total Operating Expenses | $7,269 | $6,586 | | Operating Income | $1,145 | $1,344 | | Net Income Available to Common Shareholders | $428 | $664 | Consolidated Balance Sheets As of June 30, 2024, total assets increased to $84.8 billion, driven by utility property, plant, and equipment, while total liabilities also rose due to long-term debt Key Balance Sheet Items (in millions) | Metric | June 30, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Total Current Assets | $8,512 | $6,811 | | Total Property, Plant and Equipment | $57,349 | $56,084 | | Total Assets | $84,818 | $81,758 | | Long-term Debt | $33,099 | $30,316 | | Total Liabilities | $66,950 | $63,814 | | Total Equity | $17,868 | $17,944 | Consolidated Statements of Cash Flows Net cash provided by operating activities significantly increased in the first six months of 2024, while investing activities remained stable and financing activities rose Cash Flow Summary (in millions) | Metric | Six Months Ended June 30, 2024 | Six Months Ended June 30, 2023 | | :--- | :--- | :--- | | Net Cash from Operating Activities | $1,372 | $712 | | Net Cash used in Investing Activities | ($2,670) | ($2,650) | | Net Cash from Financing Activities | $1,565 | $1,219 | | Net Change in Cash | $267 | ($719) | | Cash at End of Period | $799 | $198 | Other Information Safe Harbor Statement & Risk Factors The report includes forward-looking statements and outlines key risks such as regulatory decisions, cost recovery, extreme weather, cybersecurity, and supply chain issues - The report contains forward-looking statements that reflect current expectations but involve risks and uncertainties, and the company assumes no duty to update them[25][14] - Key operational and financial risks include: - Decisions by regulatory bodies like the CPUC and FERC - Recoverability of costs related to wildfires and mitigation efforts - Extreme weather events exacerbated by climate change - Cybersecurity of critical IT systems - Cost and availability of labor and materials due to supply chain issues and inflation - Actions by credit rating agencies[9][34] Use of Non-GAAP Financial Measures Edison International utilizes non-GAAP measures like 'core earnings' and 'core EPS' for internal planning and to provide investors with a clearer view of ongoing performance - Management uses core earnings and core EPS for internal financial planning, performance analysis, and communication with investors[24][19] - Core earnings are defined as basic earnings excluding income or loss from discontinued operations and significant discrete items not representative of ongoing earnings[33] Conference Call Information The Q2 2024 earnings conference call was held on July 25, 2024, with related materials available on the company's investor relations website - The earnings conference call was held on Thursday, July 25, at 1:30 p.m. PDT[22] - Prepared remarks, the teleconference presentation, and the Form 10-Q are available at edisoninvestor.com[31]