Edison International(EIX) - 2025 Q4 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Edison International reported a core earnings per share (EPS) of $6.55 for 2025, exceeding guidance and marking a successful delivery of the long-term core EPS growth target established in 2021 [4] - The fourth quarter core EPS was $1.86, with the full-year 2025 core EPS exceeding the high end of the guidance range [14][15] - The company reaffirmed its 2028 guidance and extended its core EPS growth target of 5%-7% through 2030 [15][20] Business Line Data and Key Metrics Changes - SCE has invested over $12 billion in customer safety and reliability over the last two years, with a focus on wildfire risk reduction and operational excellence [6][16] - The utility plans to execute a $7 billion capital plan for 2026 to meet customer needs [16] - The extended capital plan from 2026 through 2030 is projected to be between $38 billion and $41 billion, focusing on load growth-driven programs and infrastructure replacement [17] Market Data and Key Metrics Changes - SCE has the lowest system average rate among California's major investor-owned utilities, with a 2.3% rate decrease for residential customers and a 5.3% decrease for small and medium-sized businesses [6] - The typical non-CARE residential customer currently pays about $188 per month, slightly higher than $180 two years ago [6] Company Strategy and Development Direction - The company emphasizes commitments to customers, communities, and investors, focusing on safety, reliability, and affordability [5][7] - Edison International is actively engaging with policymakers to reinforce a stable regulatory framework that supports long-term investment [8][11] - The company is confident in its multi-year financial outlook, supported by a robust pipeline of necessary investments [12][20] Management's Comments on Operating Environment and Future Outlook - Management highlighted the importance of maintaining a durable regulatory environment to protect customers from higher costs and ensure stable returns for investors [7][8] - The upcoming legislative session is seen as pivotal for shaping California's energy and resiliency policy, with a focus on mitigating catastrophic wildfires [11][44] - Management expressed confidence in achieving the extended EPS growth targets and maintaining a strong balance sheet without equity needs through 2030 [20] Other Important Information - Edison International announced enhancements to the Wildfire Recovery Compensation Program, providing stronger support for displaced renters and increasing coverage for legal expenses [8][64] - The company is collaborating with the L.A. District Attorney's office regarding the investigation into the Eaton Fire, maintaining confidence in its operational prudence [76][78] Q&A Session Summary Question: Inquiry about Eaton losses and total liability visibility - Management indicated that over 2,300 claims have been submitted under the Wildfire Recovery Compensation Program, with no current estimate for total liability due to the complexity of claims [26][28] Question: Clarification on EPS growth and financing considerations - Management explained that muted growth in 2026 is due to fewer regulatory decisions and variances in asset mix, but expects to be at the high end of the growth range in subsequent years [35][36] Question: Updates on the AMI 2.0 application and capital plan - The AMI 2.0 application is expected to be filed in the coming months, with a decision anticipated in about 18 months, and the total request is projected to be around $3 billion [42] Question: Comments on SB 254 processes and legislative updates - Management noted robust participation from stakeholders in the SB 254 process and emphasized the need for a predictable framework to support capital access and affordability [44][47] Question: Details on the L.A. District Attorney's investigation - Management confirmed collaboration with the attorney's office and expressed confidence in demonstrating that SCE's actions were consistent with those of a reasonable utility operator [76][78]