SDG&E 8-K 2/24/2011



UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549


FORM 8-K

CURRENT REPORT



Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

  

  

  

  

Date of Report

 

(Date of earliest event reported):

February 24, 2011


  

  

SAN DIEGO GAS & ELECTRIC COMPANY

(Exact name of registrant as specified in its charter)

  

  

CALIFORNIA

 

1-3779

 

95-1184800

(State or other jurisdiction of incorporation)

 

(Commission
File Number)

 

(IRS Employer
Identification No.)

  

  

8326 CENTURY PARK COURT, SAN DIEGO, CA

 

92123

(Address of principal executive offices)

 

(Zip Code)

  

  


Registrant's telephone number, including area code

(619) 696-2000

  

  

 

(Former name or former address, if changed since last report.)

  

  





  

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

 

[   ]

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

 

[   ]

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

 

[   ]

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

 

[   ]

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 


  







FORM 8-K


Item 2.02   Results of Operations and Financial Condition.


The information furnished in this Item 2.02 and in Exhibits 99.1 and 99.2 shall not be deemed to be "filed" for purposes of the Securities Exchange Act of 1934, nor shall it be deemed to be incorporated by reference in any filing of San Diego Gas & Electric Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.


On February 24, 2011, Sempra Energy, of which San Diego Gas & Electric Company is a consolidated subsidiary, issued a press release announcing consolidated earnings of $280 million, or $1.15 per diluted share of common stock, for the fourth quarter of 2010. The press release has been posted on Sempra Energy's website (www.sempra.com) and a copy is attached as Exhibit 99.1.


Concurrently with the website posting of such press release and as noted therein, Sempra Energy also posted its Statement of Operations Data by Business Unit for the three months and the years ended December 31, 2010 and 2009. A copy of such information is attached as Exhibit 99.2.


The Sempra Energy financial information contained in the press release includes, on a consolidated basis, information regarding San Diego Gas & Electric Company's results of operations and financial condition.



Item 9.01  Financial Statements and Exhibits.  

  

         Exhibits  


          99.1

February 24, 2011 Sempra Energy News Release (including tables)


          99.2

Sempra Energy's Statement of Operations Data by Business Unit for the three months and the years ended December 31, 2010 and 2009.







SIGNATURE

  

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.  

  

SAN DIEGO GAS & ELECTRIC COMPANY
(Registrant)

  

  


Date: February 24, 2011

By: /s/ Robert Schlax

 

Robert Schlax
Vice President, Controller and Chief Financial Officer

 

  







Exhibit 99.1



NEWS RELEASE


Media Contact:

Doug Kline

 

Sempra Energy

 

(877) 340-8875

 

www.sempra.com



Financial Contact:

Scott Tomayko/Victor Vilaplana

 

Sempra Energy

 

(877) 736-7727

 

investor@sempra.com



SEMPRA ENERGY ANNOUNCES

IMPROVED 2010 RESULTS

FROM NON-COMMODITIES OPERATIONS


Excluding Sempra Commodities Results, Sempra Energy Reports:


·

2010 Earnings per Share of $3.61, Exceeding Company Guidance

·

34-percent Increase in Fourth-quarter Earnings per Share



SAN DIEGO, Feb. 24, 2011 – Sempra Energy (NYSE: SRE) today reported 2010 earnings of $739 million, or $2.98 per diluted share, compared with 2009 earnings of $1.12 billion, or $4.52 per diluted share.

Excluding the results of Sempra Commodities, whose assets have been sold, Sempra Energy’s earnings per share for the full year rose 14 percent to $3.61 per diluted share in 2010 from $3.16 per diluted share in 2009.  Sempra Commodities recorded a loss of $155 million, or $0.63 per diluted share, in 2010, compared with earnings of $338 million, or $1.36 per diluted share in 2009.

In the fourth quarter 2010, Sempra Energy’s earnings were $280 million, or $1.15 per diluted share, compared with $288 million, or $1.16 per diluted share, in the prior year’s quarter.  Excluding the results of Sempra Commodities, Sempra Energy’s earnings per share for the fourth quarter rose 34 percent to $1.18 per diluted share in 2010 from $0.88 per diluted share in 2009. 

“Exiting the commodities-trading business marks a new chapter for our company,” said Donald E. Felsinger, chairman and chief executive officer of Sempra Energy.  “We have narrowed our strategic focus to concentrate on utilities and contracted energy infrastructure, reducing both our risk profile and earnings volatility, while leveraging our core strengths.  This business mix has allowed us to significantly increase dividends to our shareholders and reinvest capital for future growth.”

Earlier this week, Sempra Energy announced a 23-percent increase in the dividend on shares of the company’s common stock to $1.92 per share, on an annualized basis, from $1.56 per share.  Sempra Energy’s board of directors also established a targeted dividend payout ratio of 45 percent to 50 percent of earnings.


SUBSIDIARY OPERATING RESULTS


San Diego Gas & Electric

Earnings for San Diego Gas & Electric (SDG&E) rose to $369 million in 2010 from $344 million in 2009.   SDG&E’s fourth-quarter 2010 earnings were $105 million, up from $67 million in the fourth quarter 2009, due primarily to higher authorized margins, favorable resolution of a regulatory matter and the favorable impact of the resolution of prior years’ tax issues.


Southern California Gas Co.

Southern California Gas Co. (SoCalGas) earned $286 million in 2010, up from $273 million in 2009.  In the fourth quarter 2010, SoCalGas earned $74 million, compared with $75 million in the prior year’s fourth quarter.  


Sempra Generation

Sempra Generation’s 2010 earnings were $103 million, compared with $169 million in 2009.  Sempra Generation’s fourth-quarter earnings were $43 million in 2010, compared with $45 million in 2009.  Results in 2010 included $87 million in after-tax charges related to a litigation settlement. 

In December, Sempra Generation completed the sale of its 50-percent interest in the Elk Hills Power generation facility to Occidental Petroleum Corporation, Inc., for $175 million.  The seven-year-old natural gas-fueled power plant, located near Bakersfield, Calif., was jointly owned by Sempra Generation and Occidental.

Also in December, Sempra Generation completed construction on its Copper Mountain Solar plant outside Las Vegas.  The power from the 48-megawatt facility – currently the largest photovoltaic solar power plant in the U.S. – is being sold to Pacific Gas & Electric under a 20-year contract.


Sempra Pipelines & Storage

Sempra Pipelines & Storage’s earnings increased to $159 million in 2010 from $101 million in 2009.  Fourth-quarter earnings for Sempra Pipelines & Storage were $39 million in 2010, compared with $37 million in 2009.

Last month, Sempra Pipelines & Storage announced an agreement to acquire AEI’s stake in two South American electric utilities for approximately $875 million.  Currently, Sempra Pipelines & Storage and AEI jointly own Chilquinta Energía S.A. in Chile and Luz del Sur in Peru, with the remaining shares of Luz del Sur held by institutional investors and the general public.  Upon completion of the transaction, Sempra Pipelines & Storage will own 100 percent of Chilquinta Energía and approximately 76 percent of Luz del Sur.  Scheduled to close in the second quarter 2011, the acquisition is expected to contribute additional earnings per share for Sempra Energy of approximately $0.15 in 2011 and $0.22 in 2012.  Completion of the transaction is subject to obtaining regulatory approvals and the resolution of certain tax matters.


Sempra LNG

In 2010, Sempra LNG had earnings of $68 million, up from $16 million in 2009.  In the fourth quarter 2010, Sempra LNG had earnings of $18 million, compared with $35 million in the fourth quarter 2009, due primarily to reduced payments by customers for contracted cargoes that were not delivered.  


Sempra Commodities

Sempra Commodities recorded a loss of $7 million, or $0.03 per diluted share, in the fourth quarter 2010, compared with earnings of $69 million, or $0.28 per diluted share in the fourth quarter 2009.

In December, Sempra Energy and The Royal Bank of Scotland completed the sale of the last of the principal assets of their RBS Sempra Commodities joint venture to a unit of JP Morgan Chase & Co.  These assets included wholesale natural gas and power trading agreements, as well as over-the-counter and exchange-traded transactions, with counterparties across North America.


2011 Outlook

Sempra Energy today reaffirmed its 2011 earnings-per-share outlook range of $4.00 to $4.30.


Internet Broadcast

Sempra Energy will broadcast a live discussion of its earnings results over the Internet today at 1 p.m. EST with senior management of the company.  Access is available by logging onto the Web site at www.sempra.com.  For those unable to log onto the live webcast, the teleconference will be available on replay a few hours after its conclusion by dialing (888) 203-1112 and entering passcode 3365622.

Sempra Energy, based in San Diego, is a Fortune 500 energy services holding company with 2010 revenues of $9 billion.  The Sempra Energy companies’ 13,500 employees serve about 25 million consumers worldwide.

###


This press release contains statements that are not historical fact and constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.  These statements can be identified by words like “believes,” “expects,” “anticipates,” “intends,” “plans,” “estimates,” “may,””will,” “would,” ”could,” “should,” “potential,” “target,” “depends,” or similar expressions, or discussions of strategies, plans or intentions.  Forward-looking statements are not guarantees of performance.  They involve risks, uncertainties and assumptions.  Future results may differ materially from those expressed in the forward-looking statements.  Forward-looking statements are necessarily based upon various assumptions i nvolving judgments with respect to the future and other risks, including, among others: local, regional, national and international economic, competitive, political, legislative and regulatory conditions and developments; actions by the California Public Utilities Commission, California State Legislature, California Department of Water Resources, Federal Energy Regulatory Commission, Federal Reserve Board,  and other regulatory and governmental bodies in the United States and other countries where the company does business; capital market conditions and inflation, interest and exchange rates; energy markets, including the timing and extent of changes and volatility in commodity prices; the availability of electric power, natural gas and liquefied natural gas; weather conditions and conservation efforts; war and terrorist attacks; business, regulatory, environmental and legal decisions and requirements; the status of deregulation of retail natural gas and electricity delivery; the timing and success of b usiness development efforts; the resolution of litigation; and other uncertainties, all of which are difficult to predict and many of which are beyond the control of the company.  These risks and uncertainties are further discussed in the reports that Sempra Energy has filed with the Securities and Exchange Commission.  These reports are available through the EDGAR system free-of-charge on the SEC’s website, www.sec.gov, and on the company’s website at www.sempra.com.

Sempra Pipelines & Storage, Sempra Generation, Sempra LNG and Sempra Energy Trading LLC are not the same companies as the utility, San Diego Gas & Electric (SDG&E) or Southern California Gas Company (SoCalGas), and Sempra Pipelines & Storage, Sempra Generation, Sempra LNG and Sempra Energy Trading LLC are not regulated by the California Public Utilities Commission.









SEMPRA ENERGY

Table A

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

CONSOLIDATED STATEMENTS OF OPERATIONS

 

 

 

 

 

 

 

 

 

Three months ended

 

Years ended

 

December 31,

 

December 31,

(Dollars in millions, except per share amounts)

2010 

 

2009 

 

2010 

 

2009 

 

(unaudited)

 

 

 

 

REVENUES

 

 

 

 

 

 

 

Sempra Utilities

$ 1,820

 

$ 1,838

 

$ 6,819

 

$ 6,220

Sempra Global and parent

525

 

618

 

2,184

 

1,886

    Total revenues

2,345

 

2,456

 

9,003

 

8,106

EXPENSES AND OTHER INCOME

 

 

 

 

 

 

 

Sempra Utilities:

 

 

 

 

 

 

 

    Cost of natural gas

(498)

 

(533)

 

(1,900)

 

(1,530)

    Cost of electric fuel and purchased power

(157)

 

(164)

 

(637)

 

(672)

Sempra Global and parent:

 

 

 

 

 

 

 

    Cost of natural gas, electric fuel and purchased power

(268)

 

(301)

 

(1,155)

 

(976)

    Other cost of sales

(23)

 

(28)

 

(91)

 

(80)

Litigation expense

15

 

(4)

 

(169)

 

(4)

Other operation and maintenance

(717)

 

(794)

 

(2,499)

 

(2,467)

Depreciation and amortization

(224)

 

(207)

 

(867)

 

(775)

Franchise fees and other taxes

(84)

 

(68)

 

(327)

 

(296)

Write-off of long-lived assets

-

 

-

 

-

 

(132)

Equity earnings (losses):

 

 

 

 

 

 

 

    RBS Sempra Commodities LLP

(24)

 

79

 

(314)

 

463

    Other

(2)

 

9

 

22

 

36

Other income, net

58

 

52

 

140

 

149

Interest income

3

 

5

 

16

 

21

Interest expense

(113)

 

(110)

 

(436)

 

(367)

Income before income taxes and equity earnings of certain unconsolidated subsidiaries

311

 

392

 

786

 

1,476

Income tax expense

(17)

 

(95)

 

(102)

 

(422)

Equity earnings, net of income tax

7

 

9

 

49

 

68

Net income

301

 

306

 

733

 

1,122

(Earnings) losses attributable to noncontrolling interests

(18)

 

(15)

 

16

 

7

Preferred dividends of subsidiaries

(3)

 

(3)

 

(10)

 

(10)

Earnings

$ 280

 

$ 288

 

$ 739

 

$ 1,119

 

 

 

 

 

 

 

 

Basic earnings per common share

$ 1.17

 

$ 1.18

 

$ 3.02

 

$ 4.60

Weighted-average number of shares outstanding, basic (thousands)

239,465

 

244,923

 

244,736

 

243,339

 

 

 

 

 

 

 

 

Diluted earnings per common share

$ 1.15

 

$ 1.16

 

$ 2.98

 

$ 4.52

Weighted-average number of shares outstanding, diluted (thousands)

242,519

 

248,749

 

247,942

 

247,384

Dividends declared per share of common stock

$ 0.39

 

$ 0.39

 

$ 1.56

 

$ 1.56








SEMPRA ENERGY

Table B

 

 

 

 

 

 

 

CONSOLIDATED BALANCE SHEETS

 

 

 

 

 

 

 

 

 

 

 

December 31,

 

December 31,

(Dollars in millions)

2010 

 

2009 

 

 

 

 

 

 

 

Assets

 

 

 

Current assets:

 

 

 

 

Cash and cash equivalents

$ 912

 

$ 110

 

Restricted cash

131

 

35

 

Accounts receivable

1,032

 

1,130

 

Due from unconsolidated affiliates

34

 

41

 

Income taxes receivable

248

 

221

 

Deferred income taxes

75

 

10

 

Inventories

258

 

197

 

Regulatory assets

90

 

54

 

Fixed-price contracts and other derivatives

81

 

77

 

Insurance receivable related to wildfire litigation

-

 

273

 

Settlement receivable related to wildfire litigation

300

 

-

 

Other

192

 

147

 

 

 

Total current assets

3,353

 

2,295

 

 

 

 

 

 

 

Investments and other assets:

 

 

 

 

Restricted cash

27

 

-

 

Regulatory assets arising from pension and other postretirement benefit obligations

869

 

959

 

Regulatory assets arising from wildfire litigation costs

364

 

-

 

Other regulatory assets

934

 

844

 

Nuclear decommissioning trusts

769

 

678

 

Investment in RBS Sempra Commodities LLP

787

 

2,172

 

Other investments

2,164

 

2,151

 

Goodwill and other intangible assets

540

 

524

 

Sundry

600

 

608

 

 

 

Total investments and other assets

7,054

 

7,936

Property, plant and equipment, net

19,876

 

18,281

Total assets

$ 30,283

 

$ 28,512

 

 

 

 

 

 

 

Liabilities and Equity

 

 

 

Current liabilities:

 

 

 

 

Short-term debt

$ 158

 

$ 618

 

Accounts payable

864

 

693

 

Due to unconsolidated affiliates

36

 

29

 

Dividends and interest payable

188

 

190

 

Accrued compensation and benefits

311

 

264

 

Regulatory balancing accounts, net

241

 

382

 

Current portion of long-term debt

349

 

573

 

Fixed-price contracts and other derivatives

106

 

95

 

Customer deposits

129

 

145

 

Reserve for wildfire litigation

639

 

270

 

Other

765

 

629

 

 

 

Total current liabilities

3,786

 

3,888

Long-term debt

8,980

 

7,460

 

 

 

 

 

 

 

Deferred credits and other liabilities:

 

 

 

 

Due to unconsolidated affiliate

-

 

2

 

Customer advances for construction

154

 

146

 

Pension and other postretirement benefit obligations, net of plan assets

1,105

 

1,252

 

Deferred income taxes

1,561

 

1,318

 

Deferred investment tax credits

50

 

54

 

Regulatory liabilities arising from removal obligations

2,630

 

2,557

 

Asset retirement obligations

1,449

 

1,277

 

Other regulatory liabilities

138

 

181

 

Fixed-price contracts and other derivatives

290

 

312

 

Deferred credits and other

823

 

735

 

 

 

Total deferred credits and other liabilities

8,200

 

7,834

Contingently redeemable preferred stock of subsidiary

79

 

79

Equity:

 

 

 

 

Total Sempra Energy shareholders' equity

9,027

 

9,007

 

Preferred stock of subsidiaries

100

 

100

 

Other noncontrolling interests

111

 

144

 

 

 

Total equity

9,238

 

9,251

Total liabilities and equity

$ 30,283

 

$ 28,512






SEMPRA ENERGY

Table C

 

 

 

 

 

 

CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS

 

 

 

 

 

 

 

 

 

Years ended

December 31,

(Dollars in millions)

 

2010 

 

2009 

 

 

 

 

Cash Flows from Operating Activities:

 

 

 

 

Net income

 

$ 733

 

$ 1,122

Adjustments to reconcile net income to net cash  

 

 

 

 

  provided by operating activities:

 

 

 

 

 

Depreciation and amortization

 

867

 

775

 

Gains on sale of assets

 

-

 

(3)

 

Deferred income taxes and investment tax credits

 

48

 

295

 

Equity losses (earnings)

 

243

 

(567)

 

Write-off of long-lived assets

 

-

 

132

 

Fixed-price contracts and other derivatives

 

13

 

(30)

 

Other

 

(55)

 

(45)

Net change in other working capital components

 

58

 

(256)

Distributions from RBS Sempra Commodities LLP

 

198

 

407

Changes in other assets

 

54

 

139

Changes in other liabilities

 

(5)

 

(94)

 

Net cash provided by operating activities

 

2,154

 

1,875

 

 

 

 

 

 

Cash Flows from Investing Activities:

 

 

 

 

Expenditures for property, plant and equipment

 

(2,062)

 

(1,912)

Proceeds from sale of assets

 

303

 

179

Expenditures for investments and acquisition of businesses, net of cash acquired

 

(611)

 

(939)

Distributions from RBS Sempra Commodities LLP

 

849

 

-

Distributions from other investments

 

371

 

23

Purchases of nuclear decommissioning and other trust assets

 

(371)

 

(267)

Proceeds from sales by nuclear decommissioning and other trusts

 

372

 

230

Decrease in restricted cash

 

195

 

37

Increase in restricted cash

 

(318)

 

(45)

Decrease in notes receivable from unconsolidated affiliate

 

-

 

100

Purchase of bonds issued by unconsolidated affiliate

 

-

 

(50)

Other

 

(11)

 

(28)

 

Net cash used in investing activities

 

(1,283)

 

(2,672)

 

 

 

 

 

 

Cash Flows from Financing Activities:

 

 

 

 

Common dividends paid

 

(364)

 

(341)

Preferred dividends paid by subsidiaries

 

(10)

 

(10)

Issuances of common stock

 

40

 

73

Repurchases of common stock

 

(502)

 

(22)

Issuances of debt (maturities greater than 90 days)

 

1,125

 

2,151

Payments on debt (maturities greater than 90 days)

 

(905)

 

(435)

Increase (decrease) in short-term debt, net

 

568

 

(659)

Payments on notes payable to unconsolidated affiliate

 

-

 

(100)

Purchase of noncontrolling interest

 

-

 

(94)

Other

 

(21)

 

13

 

Net cash (used in) provided by financing activities

 

(69)

 

576

 

 

 

 

 

 

Increase (decrease) in cash and cash equivalents

 

802

 

(221)

Cash and cash equivalents, January 1

 

110

 

331

Cash and cash equivalents, December 31

 

$ 912

 

$ 110






SEMPRA ENERGY

Table D

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BUSINESS UNIT EARNINGS AND CAPITAL EXPENDITURES & INVESTMENTS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

Years ended

 

 

 

December 31,

 

December 31,

(Dollars in millions)

2010 

 

2009 

 

2010 

 

2009 

 

 

 

(unaudited)

 

 

 

 

Earnings (Losses)

 

 

 

 

 

 

 

San Diego Gas & Electric

$ 105

 

$ 67

 

$ 369

 

$ 344

Southern California Gas

74

 

75

 

286

 

273

Sempra Generation

43

 

45

 

103

 

169

Sempra Pipelines & Storage

39

 

37

 

159

 

101

Sempra LNG

18

 

35

 

68

 

16

Parent & Other

8

 

(40)

 

(91)

 

(122)

Earnings before Sempra Commodities

287

 

219

 

894

 

781

Sempra Commodities

(7)

 

69

 

(155)

 

338

Earnings

$ 280

 

$ 288

 

$ 739

 

$ 1,119

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

Years ended

 

 

 

December 31,

 

December 31,

(Dollars in millions)

2010 

 

2009 

 

2010 

 

2009 

 

 

 

(unaudited)

 

 

 

 

Capital Expenditures and Investments

 

 

 

 

 

 

 

San Diego Gas & Electric

$ 388

 

$ 322

 

$ 1,210

 

$ 1,107

Southern California Gas

166

 

144

 

503

 

480

Sempra Generation

314

 

69

 

346

 

276

Sempra Pipelines & Storage

55

 

227

 

590

 

950

Sempra LNG

9

 

5

 

18

 

235

Parent & Other

2

 

1

 

6

 

5

Eliminations(1)

-

 

-

 

-

 

(152)

Consolidated Capital Expenditures and Investments

$ 934

 

$ 768

 

$ 2,673

 

$ 2,901

 

 

 

 

 

 

 

 

 

 

(1)

In the second quarter of 2009, SDG&E purchased $152 of industrial development bonds from Parent and Other.






SEMPRA ENERGY

Table E

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER OPERATING STATISTICS (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

Years ended

 

 

 

December 31,

 

December 31,

SEMPRA UTILITIES

2010 

 

2009 

 

2010 

 

2009 

Revenues (Dollars in millions)

 

 

 

 

 

 

 

 

SDG&E (excludes intercompany sales)

$ 802

 

$ 778

 

$ 3,041

 

$ 2,908

 

SoCalGas (excludes intercompany sales)

$ 1,018

 

$ 1,060

 

$ 3,778

 

$ 3,312

 

 

 

 

 

 

 

 

 

 

Gas Sales (bcf)

111

 

108

 

392

 

380

Transportation (bcf)

143

 

133

 

517

 

554

Total Deliveries (bcf)

254

 

241

 

909

 

934

Total Gas Customers (Thousands)

 

 

 

 

6,635

 

6,607

 

 

 

 

 

 

 

 

 

 

Electric Sales (Millions of kWhs)

4,169

 

4,214

 

16,266

 

16,982

Direct Access (Millions of kWhs)

837

 

829

 

3,202

 

3,119

Total Deliveries (Millions of kWhs)

5,006

 

5,043

 

19,468

 

20,101

Total Electric Customers (Thousands)

 

 

 

 

1,386

 

1,379

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SEMPRA GENERATION

 

 

 

 

 

 

 

Power Sold (Millions of kWhs)

5,614

 

5,742

 

20,886

 

22,268

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SEMPRA PIPELINES & STORAGE

 

 

 

 

 

 

 

(Represents 100% of the distribution operations of these subsidiaries, although subsidiaries in Argentina, Chile and Peru are not 100% owned by Sempra Energy. These subsidiaries are not consolidated within Sempra Energy and the related investments are accounted for under the equity method.)

Natural Gas Sales (bcf)

 

 

 

 

 

 

 

 

Argentina

80

 

81

 

331

 

330

 

Mexico

5

 

5

 

21

 

19

 

Mobile Gas

10

 

8

 

37

 

32

Natural Gas Customers (Thousands)

 

 

 

 

 

 

 

 

Argentina

 

 

 

 

1,756

 

1,710

 

Mexico

 

 

 

 

89

 

91

 

Mobile Gas

 

 

 

 

91

 

92

Electric Sales (Millions of kWhs)

 

 

 

 

 

 

 

 

Peru

1,513

 

1,409

 

5,958

 

5,560

 

Chile

613

 

565

 

2,349

 

2,402

Electric Customers (Thousands)

 

 

 

 

 

 

 

 

Peru

 

 

 

 

890

 

863

 

Chile

 

 

 

 

593

 

576






Reconciliation of Sempra Energy Earnings To

Sempra Energy Earnings Excluding Sempra Commodities

Table G (Unaudited)

 

 

 

 

 

 

 

 

 

Sempra Energy Earnings excluding Sempra Commodities and Earnings Per Share excluding Sempra Commodities are non-GAAP financial measures (GAAP represents accounting principles generally accepted in the United States). In 2009 and 2010, our Sempra Commodities segment has been comprised solely of earnings and activity related to Sempra Energy’s equity method investment in RBS Sempra Commodities, a commodities trading joint venture with The Royal Bank of Scotland (RBS). In four separate transactions in 2010 and early 2011, Sempra Energy and RBS divested substantially all of the businesses and assets within the joint venture. Because of the impacts of these divestitures on 2010 and future periods, management believes that these non-GAAP financial measures provide a more meaningful comparison of 2010 to 2 009 results of operations for Sempra Energy's ongoing business units, as well as for future comparisons in subsequent periods. Non-GAAP financial measures are supplementary information that should be considered in addition to, but not as a substitute for, the information prepared in accordance with GAAP. The table below reconciles these non-GAAP financial measures to Sempra Energy Earnings and Diluted Earnings Per Common Share, which we consider to be the most directly comparable financial measures calculated in accordance with GAAP.

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

Years ended

 

 

December 31,

 

December 31,

 

(Dollars in millions, except per share amounts)

2010 

 

2009 

 

2010 

 

2009 

 

 

 

 

 

 

 

 

Sempra Energy Earnings (GAAP)

$ 280

 

$ 288

 

$ 739

 

$ 1,119

 

Less Sempra Commodities amounts included in:

 

 

 

 

 

 

 

 

Litigation expense (adjustment)

11

 

-

 

(9)

 

-

 

Other operation and maintenance

(8)

 

(7)

 

(23)

 

(13)

 

Equity earnings (losses) in RBS Sempra Commodities LLP

(24)

 

79

 

(314)

 

463

 

Other income (expense), net

1

 

(1)

 

1

 

(2)

 

Interest income

(2)

 

-

 

4

 

-

 

Interest expense

(2)

 

-

 

(5)

 

(7)

 

Income tax benefit (expense)

17

 

(2)

 

191

 

(103)

 

Sempra Commodities earnings (losses)

(7)

 

69

 

(155)

 

338

 

Sempra Energy Earnings Excluding Sempra Commodities

$ 287

 

$ 219

 

$ 894

 

$ 781

 

 

 

 

 

 

 

 

 

 

Diluted earnings per common share:

 

 

 

 

 

 

 

 

Sempra Energy Earnings (GAAP)

$ 1.15

 

$ 1.16

 

$ 2.98

 

$ 4.52

 

Sempra Energy Earnings Excluding Sempra Commodities

$ 1.18

 

$ 0.88

 

$ 3.61

 

$ 3.16

 

Weighted-average number of shares outstanding, diluted (thousands)

242,519

 

248,749

 

247,942

 

247,384

 







Exhibit 99.2





SEMPRA ENERGY

 

 

 

Table F (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Statement of Operations Data by Business Unit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended December 31, 2010

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in millions)

 

SDG&E

 

SoCalGas

 

Generation

 

Pipelines & Storage

 

LNG

 

Commodities

 

Consolidating Adjustments, Parent & Other

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$ 804

 

$ 1,030

 

$ 293

 

$ 88

 

$ 157

 

$ -

 

$ (27)

 

 

$ 2,345

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of Sales and Other Expenses

 

(525)

 

(832)

 

(217)

 

(59)

 

(110)

 

(8)

 

4

 

 

(1,747)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Litigation Adjustment (Expense)

 

(6)

 

11

 

(2)

 

-

 

-

 

11

 

1

 

 

15

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation & Amortization

 

(98)

 

(79)

 

(18)

 

(12)

 

(13)

 

-

 

(4)

 

 

(224)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings (Losses) Recorded Before Income Tax

 

-

 

-

 

(10)

 

11

 

-

 

(24)

 

(3)

 

 

(26)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Income (Expense), Net

 

28

 

4

 

(1)

 

2

 

1

 

1

 

23

 

 

58

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (Loss) Before Interest & Tax (1)

 

203

 

134

 

45

 

30

 

35

 

(20)

 

(6)

 

 

421

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Interest (Expense) Income (2)

 

(38)

 

(16)

 

3

 

(8)

 

(11)

 

(4)

 

(39)

 

 

(113)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Tax (Expense) Benefit

 

(42)

 

(44)

 

(5)

 

10

 

(6)

 

17

 

53

 

 

(17)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings Recorded Net of Income Tax

 

-

 

-

 

-

 

7

 

-

 

-

 

-

 

 

7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings Attributable to Noncontrolling Interests

 

(18)

 

-

 

-

 

-

 

-

 

-

 

-

 

 

(18)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings (Losses)

 

$ 105

 

$ 74

 

$ 43

 

$ 39

 

$ 18

 

$ (7)

 

$ 8

 

 

$ 280

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended December 31, 2009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in millions)

 

SDG&E

 

SoCalGas

 

Generation

 

Pipelines & Storage

 

LNG

 

Commodities

 

Consolidating Adjustments, Parent & Other

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$ 780

 

$ 1,079

 

$ 337

 

$ 137

 

$ 153

 

$ -

 

$ (30)

 

 

$ 2,456

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of Sales and Other Expenses

 

(560)

 

(887)

 

(250)

 

(94)

 

(77)

 

(7)

 

(13)

 

 

(1,888)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Litigation Adjustment (Expense)

 

(1)

 

(1)

 

(1)

 

(1)

 

(1)

 

-

 

1

 

 

(4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation & Amortization

 

(90)

 

(73)

 

(15)

 

(13)

 

(12)

 

-

 

(4)

 

 

(207)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings (Losses) Recorded Before Income Tax

 

-

 

-

 

-

 

11

 

-

 

79

 

(2)

 

 

88

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Income (Expense), Net

 

19

 

3

 

2

 

2

 

1

 

(1)

 

26

 

 

52

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (Loss) Before Interest & Tax (1)

 

148

 

121

 

73

 

42

 

64

 

71

 

(22)

 

 

497

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Interest (Expense) Income (2)

 

(30)

 

(17)

 

1

 

(7)

 

(12)

 

-

 

(43)

 

 

(108)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Tax (Expense) Benefit

 

(36)

 

(29)

 

(29)

 

(6)

 

(17)

 

(2)

 

24

 

 

(95)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings Recorded Net of Income Tax

 

-

 

-

 

-

 

9

 

-

 

-

 

-

 

 

9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Earnings) Losses Attributable to Noncontrolling Interests

 

(15)

 

-

 

-

 

(1)

 

-

 

-

 

1

 

 

(15)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings (Losses)

 

$ 67

 

$ 75

 

$ 45

 

$ 37

 

$ 35

 

$ 69

 

$ (40)

 

 

$ 288

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Management believes "Income (Loss) before Interest & Tax" is a useful measurement of our business units' performance because it can be used to evaluate the effectiveness of our operations exclusive of interest and income tax, neither of which is directly relevant to the efficiency of those operations.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2) Net Interest (Expense) Income includes Interest Income, Interest Expense and Preferred Dividends of Subsidiaries.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 











SEMPRA ENERGY

 

 

 

Table F (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Statement of Operations Data by Business Unit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31, 2010

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in millions)

 

SDG&E

 

SoCalGas

 

Generation

 

Pipelines & Storage

 

LNG

 

Commodities

 

Consolidating Adjustments, Parent & Other

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$ 3,049

 

$ 3,822

 

$ 1,172

 

$ 350

 

$ 711

 

$ -

 

$ (101)

 

 

$ 9,003

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of Sales and Other Expenses

 

(1,993)

 

(3,007)

 

(866)

 

(246)

 

(519)

 

(23)

 

45

 

 

(6,609)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Litigation Adjustment (Expense)

 

(18)

 

10

 

(145)

 

(1)

 

(4)

 

(9)

 

(2)

 

 

(169)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation & Amortization

 

(381)

 

(309)

 

(65)

 

(44)

 

(51)

 

-

 

(17)

 

 

(867)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings (Losses) Recorded Before Income Tax

 

-

 

-

 

(12)

 

43

 

-

 

(314)

 

(9)

 

 

(292)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Income, Net

 

10

 

12

 

9

 

55

 

3

 

1

 

50

 

 

140

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (Loss) Before Interest & Tax (1)

 

667

 

528

 

93

 

157

 

140

 

(345)

 

(34)

 

 

1,206

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Interest (Expense) Income (2)

 

(141)

 

(66)

 

3

 

(21)

 

(47)

 

(1)

 

(157)

 

 

(430)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Tax (Expense) Benefit

 

(173)

 

(176)

 

7

 

(26)

 

(25)

 

191

 

100

 

 

(102)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings Recorded Net of Income Tax

 

-

 

-

 

-

 

49

 

-

 

-

 

-

 

 

49

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Losses Attributable to Noncontrolling Interests

 

16

 

-

 

-

 

-

 

-

 

-

 

-

 

 

16

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings (Losses)

 

$ 369

 

$ 286

 

$ 103

 

$ 159

 

$ 68

 

$ (155)

 

$ (91)

 

 

$ 739

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Year Ended December 31, 2009

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in millions)

 

SDG&E

 

SoCalGas

 

Generation

 

Pipelines & Storage

 

LNG

 

Commodities

 

Consolidating Adjustments, Parent & Other

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

$ 2,916

 

$ 3,355

 

$ 1,179

 

$ 465

 

$ 278

 

$ -

 

$ (87)

 

 

$ 8,106

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of Sales and Other Expenses

 

(2,003)

 

(2,583)

 

(844)

 

(470)

(3)

(218)

 

(13)

 

(22)

 

 

(6,153)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Litigation Adjustment (Expense)

 

5

 

(3)

 

(1)

 

(3)

 

(2)

 

-

 

-

 

 

(4)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation & Amortization

 

(329)

 

(293)

 

(58)

 

(45)

 

(35)

 

-

 

(15)

 

 

(775)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings (Losses) Recorded Before Income Tax

 

-

 

-

 

(2)

 

50

 

-

 

463

 

(12)

 

 

499

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Income (Expense), Net

 

64

 

7

 

3

 

2

 

2

 

(2)

 

73

 

 

149

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (Loss) Before Interest & Tax (1)

 

653

 

483

 

277

 

(1)

 

25

 

448

 

(63)

 

 

1,822

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Interest Expense (2)

 

(108)

 

(66)

 

-

 

(17)

 

(24)

 

(7)

 

(134)

 

 

(356)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Tax (Expense) Benefit

 

(177)

 

(144)

 

(108)

 

20

 

15

 

(103)

 

75

 

 

(422)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings Recorded Net of Income Tax

 

-

 

-

 

-

 

68

 

-

 

-

 

-

 

 

68

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Earnings) Losses Attributable to Noncontrolling Interests

 

(24)

 

-

 

-

 

31

 

-

 

-

 

-

 

 

7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings (Losses)

 

$ 344

 

$ 273

 

$ 169

 

$ 101

 

$ 16

 

$ 338

 

$ (122)

 

 

$ 1,119

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Management believes "Income (Loss) before Interest & Tax" is a useful measurement of our business units' performance because it can be used to evaluate the effectiveness of our operations exclusive of interest and income tax, neither of which is directly relevant to the efficiency of those operations.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(2) Net Interest (Expense) Income includes Interest Income, Interest Expense and Preferred Dividends of Subsidiaries.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(3) Includes $132 million write-off of long-lived assets.