Sempra Energy 11/10/2008 8-K



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):

November 10, 2008


  

  

SEMPRA ENERGY

(Exact name of registrant as specified in its charter)

  

  

CALIFORNIA

 

1-14201

 

33-0732627

(State of incorporation
or organization)

 

(Commission
File Number)

 

(IRS Employer
Identification No.)

  

  

101 ASH STREET, SAN DIEGO, CALIFORNIA

 

92101

(Address of principal executive offices)

 

(Zip Code)

  

  


Registrant's telephone number, including area code

(619) 696-2034

  

  

 

(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))

 

 



2




  

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 Sempra Energy, whether made before or after the date hereof, regardless of any general incorporation language in such filing.


On November 10, 2008, Sempra Energy issued a press release announcing consolidated net income of $308 million, or $1.24 per diluted share of common stock, for the third quarter of 2008. 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 Income Statement Data by Business Unit for the three months and nine months ended September 30, 2008 and 2007. A copy of such information is attached as Exhibit 99.2.



Item 9.01  Financial Statements and Exhibits.  

  

         Exhibits  


          99.1

November 10, 2008 Sempra Energy News Release (including tables)


          99.2

Sempra Energy's Income Statement Data by Business Unit for three months and nine months ended September 30, 2008 and 2007.








3




 

  

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.  

  

  

SEMPRA ENERGY
(Registrant)

  

  


Date: November 10, 2008

By: /s/ Joseph A. Householder

 

Joseph A. Householder
Senior Vice President, Controller and Chief Accounting Officer

 

  




4



Exhibit 99.1

Exhibit 99.1


NEWS RELEASE


Media Contact:

Doug Kline

 

Sempra Energy

 

(877) 866-2066

 

www.sempra.com



Financial Contact:

Glen Donovan

 

Sempra Energy

 

(877) 736-7727

 

investor@sempra.com


SEMPRA ENERGY THIRD-QUARTER

EARNINGS PER SHARE INCREASE

8 PERCENT


Utility, Generation, Pipeline Operations Pace Strong Results



SAN DIEGO, Nov. 10, 2008 – Sempra Energy (NYSE: SRE) today reported third-quarter 2008 net income of $308 million, or $1.24 per diluted share, up 8 percent per share over third-quarter 2007 net income of $305 million, or $1.15 per diluted share.  

Net income for the first nine months of 2008 was $794 million, or $3.13 per diluted share, compared with $810 million, or $3.06 per diluted share, during the same period last year.  Shares outstanding have been reduced in 2008 through the recently completed $1 billion share-repurchase program the company initiated in April.

“Given the turmoil and dislocation in the financial markets, we are pleased with our third-quarter results,” said Donald E. Felsinger, chairman and chief executive officer of Sempra Energy.  “We have assembled a diversified group of energy businesses that help us continue to meet our financial targets, even during down cycles in specific market segments.”



OPERATING HIGHLIGHTS

Southern California Gas Co.

Net income for Southern California Gas Co. (SoCalGas) in the third quarter 2008 rose to $77 million from $63 million in the third quarter 2007, due primarily to $11 million from the favorable resolution of regulatory and income-tax issues in 2008.  SoCalGas’ third-quarter 2008 results also included $7 million of net income from the retroactive application of its rate case, approved in July.


San Diego Gas & Electric

Third-quarter net income for San Diego Gas & Electric (SDG&E) was $123 million in 2008, unchanged from 2007.  Third-quarter 2008 results included $33 million from the retroactive application of SDG&E’s rate case, approved in July, and $12 million from the favorable resolution of income-tax issues, offset by $17 million in litigation expense.  Last year’s third-quarter results included $46 million from the favorable resolution of regulatory and income-tax issues.  SDG&E also benefited from improved operating margins in the third quarter 2008, compared with the same quarter in 2007.

On Oct. 31, the California Public Utilities Commission’s assigned commissioner and administrative law judge reviewing SDG&E’s application for the Sunrise Powerlink transmission-line project issued draft decisions in the case.  The assigned commissioner recommended conditional approval of the project, while the administrative judge recommended denial of the project.  The full commission is expected to issue a final decision on the Sunrise Powerlink next month.


RBS Sempra Commodities

Sempra Energy recorded a net loss of $3 million from its equity share of the RBS Sempra Commodities joint venture.  In last year’s third quarter, Sempra Commodities earned $87 million in net income.  Results for 2007 represented 100 percent of the earnings from the commodity-marketing business prior to the formation of RBS Sempra Commodities.  In the most recent quarter, results were negatively impacted by losses in power marketing caused by the steep decline in commodity prices during the early part of the quarter and reduced market liquidity associated with fewer market participants.

“Notwithstanding the third-quarter results in our joint venture, its outlook continues to be strong and we expect to meet our previously provided range for this segment of $250 million to $350 million in 2008,” Felsinger said.

 

Sempra Generation

Sempra Generation’s third-quarter net income rose sharply to $94 million in 2008 from $58 million in 2007, primarily due to an increase in mark-to-market earnings on long-term contracts with RBS Sempra Commodities and other counterparties.


Sempra Pipelines & Storage

Third-quarter 2008 net income for Sempra Pipelines & Storage doubled to $34 million from $17 million in last year’s third quarter, due primarily to start-up of the Rockies Express-West pipeline and the natural gas pipelines supporting Sempra LNG’s new liquefied natural gas receipt terminal in Mexico.

Last month, Sempra Energy completed its acquisition of EnergySouth, Inc., whose operations have been absorbed into Sempra Pipelines & Storage.  The transaction gives Sempra Energy a majority ownership in two large, high-cycle underground natural gas storage facilities that, when fully developed, will have capacity of 57 billion cubic feet of natural gas serving the nation’s fastest-growing natural gas markets.  The transaction also included acquisition of Mobile Gas Service Corp., an Alabama natural gas distribution utility.


Sempra LNG

Sempra LNG had net income of $4 million in the third quarter 2008, compared with a net loss of $4 million in the third quarter 2007.  The improved results were due primarily to a mark-to-market gain related to a natural gas marketing agreement with RBS Sempra Commodities.  

The third quarter of 2008 was the first full quarter of operation of Energía Costa Azul, Sempra LNG’s Mexican receipt terminal.


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 the passcode 6032084.

Sempra Energy, based in San Diego, is a Fortune 500 energy services holding company with 2007 revenues of more than $11 billion.  The Sempra Energy companies’ 13,500 employees serve more than 29 million consumers worldwide.

Complete financial tables, including income-statement information by business unit, are available on Sempra Energy’s Web site at http://www.sempra.com/downloads/3Q2008.pdf.


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,” “would,” ”could,” “should,” or similar expressions, or discussions of strategies or plans.  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 involving judgments with respect to the future and other risks, including, among others: local, regional, national and international economic, competitive, po litical, 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, U.K. Financial Services Authority and other environmental and regulatory bodies in the United States and other countries; capital market conditions, inflation rates, interest rates and exchange rates; energy and trading markets, including the timing and extent of changes 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 business development efforts; the resolution of litigation; and other uncertainties, all of which are difficult to predict and many of which are beyond th e 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 without charge at the SEC’s Web site, www.sec.gov and on the company’s Web site, at www.sempra.com.


Sempra Pipelines & Storage, Sempra Generation, Sempra LNG and Sempra Commodities  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 Commodities are not regulated by the California Public Utilities Commission.


###






SEMPRA ENERGY

Table A

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

STATEMENTS OF CONSOLIDATED INCOME  

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

Nine months ended

 

 

September 30,

 

September 30,

(Dollars in millions, except per share amounts)

2008

 

2007

 

2008

 

2007

 

 

(unaudited)

Revenues

 

 

 

 

 

 

 

Sempra Utilities

 $   2,013

 

 $   1,515

 

 $   6,190

 

 $    5,194

Sempra Global and parent

        679

 

     1,148

 

     2,275

 

      3,134

 

Total revenues

     2,692

 

     2,663

 

     8,465

 

      8,328

 

 

 

 

 

 

 

 

 

Expenses and Other Income

 

 

 

 

 

 

 

Sempra Utilities:

 

 

 

 

 

 

 

 

Cost of natural gas

      (689)

 

      (389)

 

   (2,708)

 

    (2,042)

 

Cost of electric fuel and purchased power

      (311)

 

      (184)

 

      (694)

 

       (496)

Sempra Global and parent:

 

 

 

 

 

 

 

 

Cost of natural gas, electric fuel and purchased power

      (431)

 

      (331)

 

   (1,353)

 

       (945)

 

Other cost of sales

        (15)

 

      (256)

 

      (168)

 

       (796)

Operation and maintenance

      (564)

 

      (758)

 

   (1,816)

 

    (2,140)

Depreciation and amortization

      (162)

 

      (174)

 

      (508)

 

       (514)

Franchise fees and other taxes

        (76)

 

        (72)

 

      (230)

 

       (221)

Gains on sale of assets

            -

 

            -

 

        114

 

             6

Equity earnings (losses):

 

 

 

 

 

 

 

 

RBS Sempra Commodities LLP

          (4)

 

            -

 

        142

 

             -

 

Other

          14

 

            1

 

          29

 

         (11)

Other income (expense), net

        (13)

 

            4

 

          23

 

           72

Interest income

          12

 

          12

 

          36

 

           62

Interest expense

        (67)

 

        (68)

 

      (165)

 

       (204)

Preferred dividends of subsidiaries

          (2)

 

          (2)

 

          (7)

 

           (7)

Income from continuing operations before income taxes and equity earnings of certain unconsolidated subsidiaries

        384

 

        446

 

     1,160

 

      1,092

Income tax expense

        (94)

 

      (135)

 

      (423)

 

       (341)

Equity earnings, net of income tax

          18

 

          19

 

          57

 

           86

Income from continuing operations

        308

 

        330

 

        794

 

         837

Discontinued operations, net of income tax

            -

 

        (25)

 

            -

 

         (27)

Net income

 $     308

 

 $     305

 

 $     794

 

 $      810

 

 

 

 

 

 

 

 

 

Basic earnings per share:

 

 

 

 

 

 

 

 

Income from continuing operations

 $    1.26

 

 $    1.27

 

 $    3.18

 

 $     3.23

 

Discontinued operations, net of income tax

            -

 

     (0.10)

 

            -

 

      (0.11)

 

Net income

 $    1.26

 

 $    1.17

 

 $    3.18

 

 $     3.12

Weighted-average number of shares outstanding (thousands)

  243,793

 

  259,563

 

  249,311

 

   259,742

 

 

 

 

 

 

 

 

 

Diluted earnings per share:

 

 

 

 

 

 

 

 

Income from continuing operations

 $    1.24

 

 $    1.24

 

 $    3.13

 

 $     3.16

 

Discontinued operations, net of income tax

            -

 

     (0.09)

 

            -

 

      (0.10)

 

Net income

 $    1.24

 

 $    1.15

 

 $    3.13

 

 $     3.06

Weighted-average number of shares outstanding (thousands)

  247,904

 

  264,279

 

  253,407

 

   264,416

Dividends declared per share of common stock

 $    0.35

 

 $    0.31

 

 $    1.02

 

 $     0.93

 

 

 

 

 

 

 

 

 




SEMPRA ENERGY

 

Table B

 

 

 

 

 

 

 

 

 

 

CONSOLIDATED BALANCE SHEETS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

September 30,

 

December 31,

 

(Dollars in millions)

 

2008

 

2007

 

 

 

 

 

 

(unaudited)

 

Assets

 

 

 

 

 

 

Current assets:

 

 

 

 

 

 

Cash and cash equivalents

 

 $           198

 

 $           668

 

 

Short-term investments

 

              413

 

 -

 

 

Accounts receivable, net

 

              796

 

           1,074

 

 

Income taxes receivable

 

              189

 

                99

 

 

Deferred income taxes

 

              150

 

              247

 

 

Trading-related receivables and deposits, net

 

 -

 

           2,719

*

 

Derivative trading instruments

 

 -

 

           2,170

*

 

Commodities owned

 

 -

 

           2,231

 

 

Inventories

 

              461

 

              224

 

 

Regulatory assets

 

              119

 

              106

 

 

Fixed-price contracts and other derivatives

 

                91

 

                28

*

 

Other

 

              153

 

              398

 

 

 

 

Total current assets

 

           2,570

 

           9,964

 

 

 

 

 

 

 

 

 

 

Investments and other assets:

 

 

 

 

 

 

Regulatory assets arising from fixed-price contracts and other derivatives

 

              281

 

              309

 

 

Regulatory assets arising from pension and other postretirement

 

 

 

 

 

 

 

benefit obligations

 

              144

 

              162

 

 

Other regulatory assets

 

              499

 

              460

 

 

Nuclear decommissioning trusts

 

              636

 

              739

 

 

Investment in RBS Sempra Commodities LLP

 

           1,912

 

 -

 

 

Other investments

 

           1,247

 

           1,243

 

 

Sundry

 

              746

 

              956

 

 

 

 

Total investments and other assets

 

           5,465

 

           3,869

 

Property, plant and equipment, net

 

          15,814

 

          14,884

 

Total assets

 

 $       23,849

 

 $       28,717

 

 

 

 

 

 

 

 

 

 

Liabilities and Shareholders' Equity

 

 

 

 

 

Current liabilities:

 

 

 

 

 

 

Short-term debt

 

 $           319

 

 $         1,064

 

 

Accounts payable

 

              743

 

           1,563

 

 

Due to unconsolidated affiliates

 

                37

 

                60

 

 

Trading-related payables

 

 -

 

           2,265

*

 

Derivative trading instruments

 

 -

 

           1,672

*

 

Commodities sold with agreement to repurchase

 

 -

 

              500

 

 

Dividends and interest payable

 

              164

 

              145

 

 

Regulatory balancing accounts, net

 

              264

 

              481

 

 

Current portion of long-term debt

 

              302

 

                  7

 

 

Fixed-price contracts and other derivatives

 

              175

 

                53

*

 

Other

 

           1,131

 

           1,210

 

 

 

 

Total current liabilities

 

           3,135

 

           9,020

 

Long-term debt

 

           5,864

 

           4,553

 

 

 

 

 

 

 

 

 

 

Deferred credits and other liabilities:

 

 

 

 

 

 

Due to unconsolidated affiliate

 

              102

 

              102

 

 

Customer advances for construction

 

              153

 

              153

 

 

Pension and other postretirement benefit obligations, net of plan assets

 

              412

 

              434

 

 

Deferred income taxes

 

              799

 

              531

 

 

Deferred investment tax credits

 

                58

 

                61

 

 

Regulatory liabilities arising from removal obligations

 

           2,420

 

           2,522

 

 

Asset retirement obligations

 

           1,165

 

           1,129

 

 

Other regulatory liabilities

 

              234

 

              265

 

 

Fixed-price contracts and other derivatives

 

              315

 

              332

 

 

Deferred credits and other

 

              911

 

              949

 

 

 

 

Total deferred credits and other liabilities

 

           6,569

 

           6,478

 

Preferred stock of subsidiaries

 

              179

 

              179

 

Minority interests

 

              204

 

              148

 

Shareholders' equity

 

           7,898

 

           8,339

 

Total liabilities and shareholders' equity

 

 $       23,849

 

 $       28,717

 

 

 

 

 

 

 

 

 

 

* December 31, 2007 amounts have been reclassified due to the adoption of FASB Staff Position FIN 39-1.




SEMPRA ENERGY

Table C

 

 

 

 

 

 

CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS

 

 

 

 

 

Nine months ended

 

 

 

September 30,

(Dollars in millions)

 

2008

 

2007

 

 

 

(unaudited)

Cash Flows from Operating Activities:

 

 

 

 

Net income

 

 $        794

 

 $      810

Adjustments to reconcile net income to net cash  

 

 

 

 

  provided by operating activities:

 

 

 

 

 

Discontinued operations

 

               -

 

           27

 

Depreciation and amortization

 

           508

 

         514

 

Deferred income taxes and investment tax credits

 

           165

 

           42

 

Equity earnings

 

          (228)

 

          (75)

 

Gains on sale of assets

 

          (114)

 

            (6)

 

Fixed-price contracts and other derivatives

 

              7

 

             8

 

Tax benefits from share-based awards

 

             (7)

 

          (12)

 

Other

 

             83

 

           37

Net changes in other working capital components

 

          (408)

 

         131

Distribution from RBS Sempra Commodities LLP

 

             56

 

             -

Changes in other assets

 

             (3)

 

           35

Changes in other liabilities

 

            (55)

 

           63

 

Net cash provided by continuing operations

 

           798

 

      1,574

 

Net cash used in discontinued operations

 

               -

 

            (3)

 

Net cash provided by operating activities

 

           798

 

      1,571

 

 

 

 

 

 

Cash Flows from Investing Activities:

 

 

 

 

Expenditures for property, plant and equipment

 

       (1,541)

 

     (1,357)

Proceeds from sale of assets, net of cash sold

 

        2,071

 

           77

Expenditures for investments

 

       (2,180)

 

          (17)

Distributions from investments

 

             23

 

           13

Purchases of nuclear decommissioning and other trust assets

 

          (361)

 

        (498)

Proceeds from sales by nuclear decommissioning and other trusts

 

           350

 

         458

Decrease in notes receivable from unconsolidated affiliates

 

             60

 

 -

Other

 

            (18)

 

          (19)

 

Net cash used for investing activities

 

       (1,596)

 

     (1,343)

 

 

 

 

 

 

Cash Flows from Financing Activities:

 

 

 

 

Common dividends paid

 

(252)

 

        (234)

Issuances of common stock

 

             17

 

           36

Repurchases of common stock

 

       (1,002)

 

        (161)

Increase in short-term debt, net

 

           985

 

         954

Issuance of long-term debt

 

           650

 

         359

Payments on long-term debt

 

            (75)

 

     (1,069)

Tax benefits from share-based awards

 

              7

 

           12

Other

 

             (2)

 

            (2)

 

Net cash provided by (used in) financing activities

 

           328

 

        (105)

 

 

 

 

 

 

Increase (decrease) in cash and cash equivalents

 

          (470)

 

         123

Cash and cash equivalents, January 1

 

           668

 

         920

Cash assumed in connection with FIN 46(R) initial consolidation

 

             -   

 

           29

Cash and cash equivalents, September 30

 

 $        198

 

 $    1,072

 

 

 

 

 

 




SEMPRA ENERGY

 

Table D

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BUSINESS UNIT EARNINGS AND CAPITAL EXPENDITURES & INVESTMENTS (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

Nine months ended

 

 

 

 

September 30,

 

September 30,

 

(Dollars in millions)

2008

 

2007

 

2008

 

2007

 

 

 

 

 

 

 

 

 

 

 

 

Net Income

 

 

 

 

 

 

 

 

San Diego Gas & Electric

 $     123

 

 $     123

 

 $      258

 

 $     236

 

Southern California Gas

         77

 

         63

 

         190

 

        172

 

Sempra Commodities*

          (8)

 

         87

 

         181

 

        313

 

Sempra Generation

         94

 

         58

 

         162

 

        122

 

Sempra Pipelines & Storage

         34

 

         17

 

           84

 

          50

 

Sempra LNG

           4

 

          (4)

 

          (33)

 

         (27)

 

Parent & Other

        (16)

 

        (14)

 

          (48)

 

         (29)

 

Continuing Operations

       308

 

       330

 

         794

 

        837

 

Discontinued Operations, Net of Income Tax

            -

 

        (25)

 

             -

 

         (27)

 

Consolidated Net Income

 $     308

 

 $     305

 

 $      794

 

 $     810

 

 

 

 

 

 

 

 

 

 

 

 

*

Includes the company's portion of RBS Sempra Commodities' joint venture earnings since the formation of the joint venture on April 1, 2008, and 100% of the commodities' marketing businesses prior to April 1, 2008. Also includes the operating results of Sempra Rockies Marketing, as well as interest, income taxes, cost allocations and other items associated with the joint venture.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

Nine months ended

 

 

 

 

September 30,

 

September 30,

 

(Dollars in millions)

2008

 

2007

 

2008

 

2007

 

 

 

 

 

 

 

 

 

 

 

 

Capital Expenditures and Investments*

 

 

 

 

 

 

 

 

San Diego Gas & Electric

 $     277

**

 $     174

 

 $      942

**

 $     479

 

Southern California Gas

       108

 

       109

 

         350

 

        300

 

Sempra Commodities

            -

 

         24

 

           37

 

          49

 

Sempra Generation

           2

 

           4

 

           15

 

            8

 

Sempra Pipelines & Storage

         43

 

         43

 

         345

 

        180

 

Sempra LNG

         61

 

       122

 

         310

 

        346

 

Parent & Other

       165

**

           4

 

         426

**

          12

 

Eliminations

      (229)

***

            -

 

        (304)

***

            -

 

Consolidated Capital Expenditures and Investments

 $     427

 

 $     480

 

 $   2,121

 

 $   1,374

 

 

 

 

 

 

 

 

 

 

 

 

*

Investments do not include the $1.6 billion contribution to RBS Sempra Commodities in the second quarter of 2008.

 

 

 

 

 

 

 

 

 

 

 

**

Purchases of industrial development bonds for SDG&E and Parent & Other were $68 and $161, respectively, in the three months ended September 30, 2008 and $304 and $413, respectively, for the nine months ended September 30, 2008.

 

 

 

 

 

 

 

 

 

 

 

 

***

Represents purchases and sales of industrial development bonds between SDG&E and Parent & Other.




 

 

 

 

 

 

 

 

 

 

                        SEMPRA ENERGY

 

 

 

                               Table E

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OTHER OPERATING STATISTICS (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three months ended

 

Nine months ended

 

 

 

September 30,

 

September 30,

SEMPRA UTILITIES

2008

 

2007

 

2008

 

2007

 

 

 

 

 

 

 

 

 

 

Revenues (Dollars in millions)

 

 

 

 

 

 

 

SDG&E (excludes intercompany sales)

 $    945

 

 $    714

 

 $ 2,439

 

 $ 2,074

SoCalGas (excludes intercompany sales)

 $ 1,068

 

 $    801

 

 $ 3,751

 

 $ 3,120

 

 

 

 

 

 

 

 

 

 

Gas Sales (Bcf)

         63

 

         65

 

       288

 

       290

Transportation and Exchange (Bcf)

       171

 

       178

 

       445

 

       421

Total Deliveries (Bcf)

       234

 

       243

 

       733

 

       711

 

 

 

 

 

 

 

 

 

 

Total Gas Customers (Thousands)

 

 

 

 

    6,565

 

    6,517

 

 

 

 

 

 

 

 

 

 

Electric Sales (Millions of kWhs)

    4,716

 

    4,788

 

  13,012

 

  12,847

Direct Access (Millions of kWhs)

       781

 

       907

 

    2,296

 

    2,401

Total Deliveries (Millions of kWhs)

    5,497

 

    5,695

 

  15,308

 

  15,248

 

 

 

 

 

 

 

 

 

 

Total Electric Customers (Thousands)

 

 

 

 

    1,370

 

    1,363

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SEMPRA GENERATION

 

 

 

 

 

 

 

Power Sold (Millions of kWhs)

    5,707

 

    5,718

 

  16,825

 

  15,243

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SEMPRA PIPELINES & STORAGE

 

 

 

 

 

 

 

(Represents 100% of these subsidiaries, although only the Mexican subsidiaries are 100% owned by Sempra Energy.)

Natural Gas Sales (Bcf)

 

 

 

 

 

 

 

 

Argentina

 

       102

 

       100

 

       254

 

       241

 

Mexico

 

         12

 

         13

 

         36

 

         35

 

Chile

 

           -

 

          1

 

           -

 

          1

Natural Gas Customers (Thousands)

 

 

 

 

 

 

 

 

Argentina

 

 

 

 

 

    1,658

 

    1,589

 

Mexico

 

 

 

 

 

         95

 

         95

 

Chile

 

 

 

 

 

         39

 

         39

Electric Sales (Millions of kWhs)

 

 

 

 

 

 

 

 

Peru

 

    1,347

 

    1,273

 

    4,063

 

    3,800

 

Chile

 

       565

 

       582

 

    1,797

 

    1,868

Electric Customers (Thousands)

 

 

 

 

 

 

 

 

Peru

 

 

 

 

 

       829

 

       803

 

Chile

 

 

 

 

 

       559

 

       545




SEMPRA ENERGY

Table E (Continued)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

SEMPRA COMMODITIES

 

 

 

The following information for the Sempra Commodities segment includes information related to RBS Sempra Commodities LLP.  RBS Sempra Commodities LLP acquired the commodity-marketing businesses of Sempra Energy on April 1, 2008.  For the three and six months ended September 30, 2008, the Sempra Commodities segment is composed primarily of the company's equity interest in RBS Sempra Commodities LLP, but also includes the results of Sempra Rockies Marketing.  The margin and financial data below represents the total results of RBS Sempra Commodities LLP as calculated under International Financial Reporting Standards (IFRS).

 

 

 

 

 

RBS Sempra Commodities LLP

 

 

 

 

 

 

 

 

Operating Statistics

 

 

 

(in millions of US dollars)

 

 

 

 

 

Three

 

Six

 

 

months ended

 

months ended

RBS Sempra Commodities LLP - Joint Venture level margin*

September 30, 2008

 

September 30, 2008

 

 

 

 

 

Geographical:

 

 

 

 

North America

 $                           (79)

 

 $                       443

 

Europe/Asia

                             139

 

                          263

 

  Total

 $                            60

 

 $                       706

 

 

 

 

 

Product Line:

 

 

 

 

Natural Gas

 $                            57

 

 $                       363

 

Oil - Crude & Products

                               22

 

                          114

 

Metals

                               62

 

                          104

 

Power

                              (81)

 

                            93

 

Other

                                  -

 

                            32

 

  Total

 $                            60

 

 $                       706

 

 

 

 

 

* Margin consists of operating revenues less cost of sales (primarily transportation and storage costs) reduced by certain transaction-related execution costs (primarily brokerage and other fees) and net interest income/expense.

 

 

 

 

 

Financial Information

 

 

 

(in millions of US dollars)

 

 

 

 

 

 

 

 

RBS Sempra Commodities LLP

Three months ended September 30, 2008

 

 

Joint Venture

 

Sempra

 

 

Total

 

Share**

 

Fee income and trading revenue, net of selling costs

 $                            60

 

 

 

Operating and other expenses

                              (93)

 

 

 

Joint Venture distributable income

 $                           (33)

 

 

 

 

 

 

 

 

 

 

 

 

 

Preferred return on capital

 $                           131

 

 $                         60

 

1st allocation - 70% Sempra / 30% RBS

                            (103)

 

                           (71)

 

2nd allocation - 30% Sempra / 70% RBS

                              (61)

 

                           (18)

 

Distributable income

 $                           (33)

 

 $                        (29)

 

 

 

 

 

 

 

Six months ended September 30, 2008

 

 

Joint Venture

 

Sempra

 

 

Total

 

Share**

 

Fee income and trading revenue, net of selling costs

 $                           706

 

 

 

Operating and other expenses

                            (405)

 

 

 

Joint Venture distributable income

 $                           301

 

 

 

 

 

 

 

 

 

 

 

 

 

Preferred return on capital

 $                           279

 

 $                       120

 

1st allocation - 70% Sempra / 30% RBS

                               22

 

                            16

 

2nd allocation - 30% Sempra / 70% RBS

                                  -

 

                              -

 

Distributable income

 $                           301

 

 $                       136

 

 

 

 

 

Sempra Earnings from RBS Sempra Commodities LLP

 

 

 

 

 

 

 

 

 

 

Three

 

Six

 

 

months ended

 

months ended

(in millions of US dollars)

September 30, 2008

 

September 30, 2008

 

Sempra share of distributable income - IFRS basis

 $                           (29)

 

 $                       136

 

U.S. GAAP conversion impact

                               25

 

                              6

 

Sempra equity earnings - U.S. GAAP basis

                                (4)

 

                          142

 

Income tax expense

                                 1

 

                           (52)

 

Sempra equity earnings from RBS Sempra Commodities LLP

 $                             (3)

 

 $                         90

 

 

 

 

 

**After a 15% preferred return to Sempra and then a 15% return to RBS, Sempra receives 70% of the next $500 million and 30% of any remaining income on an annual basis. The preferred returns and the 1st allocation (the $500 million tranche) are prorated over the year. Negative amounts in the three-month period represent reductions required to reflect the YTD calculations of the 1st and 2nd allocations.

Exhibit 99.2

Exhibit 99.2



SEMPRA ENERGY

 

 

 

Table F (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Statement Data by Business Unit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended September 30, 2008

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in millions)

 

SDG&E

 

SoCalGas

 

Commodities

 

Generation

 

Pipelines & Storage

 

LNG

 

Consolidating Adjustments, Parent & Other

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

 $        949

 

 $       1,077

 

 $             13

 

 $          498

 

 $          127

 

 $            49

 

 $            (21)

 

 

 $ 2,692

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of Sales and Other Expenses

 

         (689)

 

            (879)

 

              (15)

 

           (349)

 

           (112)

 

             (31)

 

               (11)

 

 

  (2,086)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation & Amortization

 

           (68)

 

             (67)

 

                  -

 

             (14)

 

              (5)

 

              (6)

 

                 (2)

 

 

    (162)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings (Losses) Recorded Before Income Tax

 

               -

 

                 -

 

               (4)

 

                8

 

              10

 

                 -

 

                 (4)

 

 

        10

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Income (Expense), Net

 

            10

 

               (1)

 

                  -

 

              (1)

 

              (1)

 

              (2)

 

               (18)

 

 

      (13)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (Loss) Before Interest & Tax (1)

 

          202

 

             130

 

               (6)

 

             142

 

              19

 

               10

 

               (56)

 

 

      441

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Interest (Expense) Income (2)

 

           (25)

 

             (12)

 

               (3)

 

              (2)

 

                2

 

              (3)

 

               (14)

 

 

      (57)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Tax (Expense) Benefit

 

           (54)

 

             (41)

 

                 1

 

             (46)

 

              (5)

 

              (3)

 

                 54

 

 

      (94)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings Recorded Net of Income Tax

 

               -

 

                 -

 

                  -

 

                 -

 

              18

 

                 -

 

                   -

 

 

        18

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (Loss)

 

 $        123

 

 $            77

 

 $             (8)

 

 $            94

 

 $            34

 

 $              4

 

 $            (16)

 

 

 $    308

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended September 30, 2007

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in millions)

 

SDG&E

 

SoCalGas

 

Commodities

 

Generation

 

Pipelines & Storage

 

LNG

 

Consolidating Adjustments, Parent & Other

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

 $        716

 

 $          819

 

 $           679

 

 $          390

 

 $            81

 

 $              -

 

 $            (22)

 

 

 $ 2,663

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of Sales and Other Expenses

 

         (474)

 

            (631)

 

            (506)

 

           (294)

 

             (77)

 

              (9)

 

                   1

 

 

  (1,990)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation & Amortization

 

           (75)

 

             (71)

 

               (6)

 

             (16)

 

              (3)

 

                 -

 

                 (3)

 

 

    (174)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings (Losses) Recorded Before Income Tax

 

               -

 

                 -

 

                  -

 

                7

 

              (2)

 

                 -

 

                 (4)

 

 

          1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Income (Expense), Net

 

              8

 

                 -

 

                  -

 

                1

 

                1

 

                 -

 

                 (6)

 

 

          4

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (Loss) Before Interest & Tax (1)

 

          175

 

             117

 

              167

 

              88

 

                 -

 

              (9)

 

               (34)

 

 

      504

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Interest (Expense) Income (2)

 

           (24)

 

             (10)

 

              (14)

 

                2

 

              (1)

 

              (1)

 

               (10)

 

 

      (58)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Tax (Expense) Benefit

 

           (28)

 

             (44)

 

              (66)

 

             (32)

 

              (1)

 

                6

 

                 30

 

 

    (135)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings Recorded Net of Income Tax

 

               -

 

                 -

 

                  -

 

                 -

 

              19

 

                 -

 

                   -

 

 

        19

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Discontinued Operations

 

               -

 

                 -

 

                  -

 

                 -

 

                 -

 

                 -

 

               (25)

 

 

      (25)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (Loss)

 

 $        123

 

 $            63

 

 $             87

 

 $            58

 

 $            17

 

 $            (4)

 

 $            (39)

 

 

 $    305

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Management believes "Income (Loss) before Interest & Taxes" 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 taxes, 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)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Statement Data by Business Unit

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30, 2008

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in millions)

 

SDG&E

 

SoCalGas

 

Commodities

 

Generation

 

Pipelines & Storage

 

LNG

 

Consolidating Adjustments, Parent & Other

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

 $     2,449

 

 $       3,776

 

 $           486

 

 $      1,426

 

 $         338

 

 $          44

 

 $           (54)

 

 

 $ 8,465

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of Sales and Other Expenses

 

       (1,796)

 

         (3,225)

 

           (410)

 

       (1,131)

 

         (314)

 

           (75)

 

              (18)

 

 

  (6,969)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation & Amortization

 

         (223)

 

            (209)

 

               (6)

 

           (42)

 

           (10)

 

             (8)

 

              (10)

 

 

    (508)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gains (Losses) on Sale of Assets

 

              3

 

                 -

 

             110

 

               2

 

                -

 

                -

 

                (1)

 

 

      114

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings (Losses) Recorded Before Income Tax

 

               -

 

                 -

 

             142

 

             10

 

             30

 

                -

 

              (11)

 

 

      171

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Income (Expense), Net

 

            18

 

                1

 

                  -

 

               1

 

               2

 

             13

 

              (12)

 

 

        23

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (Loss) Before Interest & Tax (1)

 

          451

 

             343

 

             322

 

           266

 

             46

 

           (26)

 

            (106)

 

 

    1,296

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Interest (Expense) Income (2)

 

           (72)

 

             (36)

 

             (12)

 

             (6)

 

               4

 

             (5)

 

                (9)

 

 

    (136)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Tax (Expense) Benefit

 

         (121)

 

            (117)

 

           (132)

 

           (98)

 

           (20)

 

             (2)

 

                67

 

 

    (423)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings Recorded Net of Income Tax

 

               -

 

                 -

 

                 3

 

                -

 

             54

 

                -

 

                   -

 

 

        57

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (Loss)

 

 $        258

 

 $          190

 

 $           181

 

 $         162

 

 $          84

 

 $        (33)

 

 $           (48)

 

 

 $    794

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nine Months Ended September 30, 2007

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Dollars in millions)

 

SDG&E

 

SoCalGas

 

Commodities

 

Generation

 

Pipelines & Storage

 

LNG

 

Consolidating Adjustments, Parent & Other

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenues

 

 $     2,084

 

 $       3,168

 

 $        1,901

 

 $      1,064

 

 $         242

 

 $        (11)

 

 $          (120)

 

 

 $ 8,328

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of Sales and Other Expenses

 

       (1,463)

 

         (2,630)

 

         (1,437)

 

         (842)

 

         (227)

 

           (30)

 

              (11)

 

 

  (6,640)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Depreciation & Amortization

 

         (225)

 

            (210)

 

             (19)

 

           (41)

 

             (9)

 

                -

 

              (10)

 

 

    (514)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gains on Sale of Assets

 

              2

 

                2

 

                  -

 

                -

 

                -

 

                -

 

                  2

 

 

          6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings (Losses) Recorded Before Income Tax

 

               -

 

                 -

 

                  -

 

               6

 

             (5)

 

                -

 

              (12)

 

 

      (11)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Income (Expense), Net

 

            10

 

               (4)

 

                  -

 

                -

 

               2

 

                -

 

                64

 

 

        72

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (Loss) Before Interest & Tax (1)

 

          408

 

             326

 

             445

 

           187

 

               3

 

           (41)

 

              (87)

 

 

    1,241

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Interest (Expense) Income (2)

 

           (71)

 

             (32)

 

             (16)

 

             11

 

             (1)

 

             (2)

 

              (38)

 

 

    (149)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income Tax (Expense) Benefit

 

         (101)

 

            (122)

 

           (156)

 

           (76)

 

               2

 

             16

 

                96

 

 

    (341)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Equity Earnings Recorded Net of Income Tax

 

               -

 

                 -

 

               40

 

                -

 

             46

 

                -

 

                   -

 

 

        86

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Discontinued Operations

 

               -

 

                 -

 

                  -

 

                -

 

                -

 

                -

 

              (27)

 

 

      (27)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net Income (Loss)

 

 $        236

 

 $          172

 

 $           313

 

 $         122

 

 $          50

 

 $        (27)

 

 $           (56)

 

 

 $    810

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(1) Management believes "Income (Loss) before Interest & Taxes" 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 taxes, 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.