PG&E (US:PCG)2023-11-28 18:13PG&E Corporation Business Update Call Summary Company Overview - Company: PG&E Corporation (NYSE: PCG) - Date of Call: November 28, 2023 - Participants: - Jonathan Arnold - Vice President of Investor Relations - Patti Poppe - Chief Executive Officer - Carolyn Burke - Executive Vice President and Chief Financial Officer Key Highlights Industry and Regulatory Updates - The California Public Utilities Commission (CPUC) voted unanimously (5-0) on a revised decision in PG&E's 2023 General Rate Case (GRC), setting utility-based revenue requirements for 2023-2026 [6][10] - This GRC is significant as it is the first four-year GRC covering both electric and gas for California's largest utility [6] Financial Performance and Guidance - PG&E is on track to meet its non-GAAP core earnings per share (EPS) guidance for 2023, with a revised range of $1.20 to $1.23, up from the previous $1.19 to $1.23 [6][7] - For 2024, PG&E introduced a guidance range of $1.31 to $1.35, maintaining a commitment to at least 10% EPS growth for both 2023 and 2024 [7] - The company reaffirmed a commitment to at least 9% core EPS growth for 2025 and 2026 [7] Dividend Reinstatement - PG&E's Board approved the reinstatement of a common dividend, declaring an initial quarterly payment of $0.01 per share, payable on January 15, 2024 [8] - The company had not paid dividends for nearly six years, with earnings retained for reinvestment into the system [8] - Future dividend growth is expected to align with earnings growth, potentially exceeding it due to the low starting point [9][34] Capital Investment and Recovery - PG&E plans to prioritize critical customer investments while maintaining a focus on improving credit ratings [9][12] - The GRC decision includes significant funding for wildfire mitigation programs and system hardening, with an increase in undergrounding mileage to 1,230 miles [10] - PG&E expects to file a 10-year undergrounding plan under SB 884 by mid-2024 [11] Cost Management and Operational Efficiency - PG&E targets average annual increases in customer bills of 2% to 4% through 2026, with a focus on achieving at least 2% savings annually in non-fuel O&M [13][44] - The company aims to reduce operating expenses while ensuring robust infrastructure to support customer needs [44] Future Outlook and Strategic Initiatives - PG&E is committed to restoring investment-grade credit ratings and plans to pay down at least $2 billion of parent debt by 2026 [9][54] - The company is optimistic about the potential for asset sales if necessary, but currently has no immediate plans [31] - PG&E is focused on maintaining a disciplined approach to capital spending and recovery processes [37] Upcoming Catalysts - Key upcoming regulatory decisions include the final decision for the 2023 wildfire mitigation plan and the proposed decision on the Pacific Generation sales structure [14] - PG&E anticipates further updates on its financial and operational plans during the year-end earnings call in February [14] Conclusion - PG&E Corporation is positioned for growth with a clear path to achieving its financial targets while addressing regulatory requirements and customer needs. The reinstatement of dividends marks a significant milestone in the company's recovery journey, and ongoing investments in infrastructure are expected to support long-term growth and stability.