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UNITED STATES | ||||||||||||
FORM 10-Q | ||||||||||||
(Mark One) | ||||||||||||
[X] | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||||||||
| For the quarterly period ended | September 30, 2010 | ||||||||||
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[ ] | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||||||||
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Commission File No. | Exact Name of Registrants as Specified in their Charters, Address and Telephone Number | States of Incorporation | I.R.S. Employer | Former name, former address and former fiscal year, if changed since last report | ||||||||
1-14201 | SEMPRA ENERGY | California | 33-0732627 | No change | ||||||||
| 101 Ash Street |
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| San Diego, California 92101 |
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| (619)696-2034 |
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1-3779 | SAN DIEGO GAS & ELECTRIC COMPANY | California | 95-1184800 | No change | ||||||||
| 8326 Century Park Court |
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| San Diego, California 92123 |
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< p style="MARGIN:0in 4.5pt 0pt 0in; LINE-HEIGHT:115%"> | (619)696-2000 |
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1-40 | PACIFIC ENTERPRISES | California | 94-0743670 | No change | ||||||||
| 101 Ash Street |
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| S an Diego, California 92101 |
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| (619)696-2020 | |
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1-1402 | SOUTHERN CALIFORNIA GAS COMPANY | 95-1240705 | No chang e | |||||||||
| 555 West Fifth Street | p> |
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| Los Angeles, California 90013 |
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| (213)244-1200 |
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| Yes | X |
| No |
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Sempra Energy | Yes | X |
| No |
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San Diego Gas & Electric Company | Yes |
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Pacific Enterprises | Yes |
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Southern California Gas Company | Yes |
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| Large | Accelerated filer | Non-accelerated filer | Smaller reporting company | ||||||||
Sempra Energy | [ X ] | [ ] | [ ] | [ ] | ||||||||
San Diego Gas & Electric Company | [ ] | [ ] | [ X ] | [ ] | ||||||||
Pacific Enterprises | [ ] | [ ] | [ X ] | [ ] | ||||||||
Southern California Gas Company td> | [ ] | [ ] | [ X ] | [ ] | ||||||||
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Sempra Energy | Yes |
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San Diego Gas & Electric Company | Yes |
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Pacific Enterprises | Yes |
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Southern California Gas Company | Yes |
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Indicate the number of shares outstanding of each of the issuers' classes of common stock, as of the latest practicable date. | ||||||||||||
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Common stock outstanding on November 5, 2010: |
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Sempra Energy | 240,054,962 shares | |||||||||||
San Diego Gas & Electric Company | Wholly owned by Enova Corporation, which is wholly owned by Sempra Energy | |||||||||||
Pacific Enterprises | Wholly owned by Sempra Energy | |||||||||||
Southern California Gas Company< /p> | Wholly owned by Pacific Enterprises, which is wholly owned by Sempra Energy | |||||||||||
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SEMPRA ENERGY FORM 10-Q |
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| Page | |
Information Regarding Forward-Looking Statements | 4 | |
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PART I FINANCIAL INFORMATION |
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Item 1. | Financial Statements | 5 |
Item 2. | Managements Discussion and Analysis of Financial Condition and Results of Operations | 73 |
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | 99 |
Item 4. | Controls and Procedures p> | 100 |
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PART II OTHER INFORMATION |
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Item 1. | Legal Proceedings | 101 |
Item 1A. | Risk Factors | 101 |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds | 102 |
Item 6. | Exhibits < /td> | 103 |
| &nb sp; |
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Signatures | 105 | |
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This combined Form 10-Q is separately filed by Sempra Energy, San Diego Gas & Electric Company, Pacific Enterprises and Southern California Gas Company. Information contained herein relating to any individual company is filed by such company on its own behalf. Each company provides information only as to itself and its consolidated entities and not as to any other company.
You should read this report in its entirety as it pertains to each respective reporting company. No one section of the report deals with all aspects of the subject matter. Separ ate Part I - Item 1 sections are provided for each reporting company, except for the Notes to Condensed Consolidated Financial Statements. The Notes to Condensed Consolidated Financial Statements for all of the reporting companies are combined. All Items other than Part I Item 1 are combined for the reporting companies.
INFORMATION REGARDING FORWARD-LOOKING STATEMENTS
We make statements in this report that are not historical fact and constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are necessarily based upon assumptions with respect to the future, involve risks and uncertainties, and are not guarantees of performance. These forward-looking statements represent our estimates and assumptions only as of the date of this report.
In this report, when we use words such as "believes," "expects," "anticipates," "plans," "estimates," "projects," "contemplates," "intends," "depends," "should," "could," "would," "may," "potential," "target," "goals," or similar expressions, or when we discuss our strategy, plans or intentions, we are making forward-looking statements.
Factors, among others, that could cause our actual results and future actions to differ materially from those described in forward-looking statements include
§local, regional, national and international economic, competitive, political, legislative and regulatory conditions and developments;
§actions by the California Public Utilities Commission, the California State Legislature, the California Department of Water Resources, the Federal Energy Regulatory Commission, the Federal Reserve Board, and other regulatory and governmental bodies in the United States and other countries in which we operate;
§capital markets conditions and inflation, interest and exchange rates;
§energy and trading 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 t iming 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 our control.
We caution you not to rely unduly on any forward-looking statements. You should review and consider carefully the risks, uncertainties and other factors that affect our business as described in this report and other reports that we file with the Securities and Exchange Commission.
PART I FINANCIAL INFORMATI ON
ITEM 1. FINANCIAL STATEMENTS
SEMPRA ENERGY | ||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
(Dollars in millions, except per share amounts) | ||||||||
| Three months ended | Nine months ended | ||||||
| September 30, | September 30, | ||||||
| 2010 | 2009 | 2010 | 2009 | ||||
| (unaudited) | |||||||
REVENUES |
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Sempra Utilities | $ | 1,575 | $ | 1,424 | $ | 4,999 | $ | 4,382 |
Sempra Global and parent |
| 541 |
| 429 |
| 1,659 |
| 1,268 |
Total revenues |
| 2,116 |
| 1,853 |
| 6,658 |
| 5,650 |
EXPENSES AND OTHER INCOME |
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Sempra Utilities: |
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Cost of natural gas |
| (285) |
| (208) |
| (1,402) |
| (997) |
Cost of electric fuel and purchased power |
| (203) |
| (208) |
| (480) |
| (508) |
Sempra Global and parent: |
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Cost of natural gas, electric fuel and purchased power |
| (292) |
| (220) |
| (887) |
| (675) |
Other cost of sales |
| (23) |
| (19) |
| (68) |
| (52) |
Litigation expense |
| (17) |
| (3) |
| (184) |
| - |
Other operation and maintenance |
| (590) |
| (568) |
| (1,782) |
| (1,673) |
Depreciation and amortization |
| (218) |
| (196) |
| (643) |
| (568) |
Franchise fe es and other taxes |
| (76) |
| (77) |
| (243) |
| (228) |
Write-off of long-lived assets |
| - font> |
| - |
| - |
| (132) |
Equity earnings (losses): |
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RBS Sempra Commodities LLP |
| (281) |
| 105 |
| (290) |
| 384 |
Other |
| 8 |
| 18 |
| 24 |
| 27 |
Other income, net |
| 66 |
| 24 |   ; | 82 |
| 97 |
Interest income |
| 5 |
| 5 |
| 13 |
| 16 |
Interest expense |
| (111) |
| (96) |
| (323) |
| (257) |
Income before income taxes and equity earnings |
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of certain unconsolidated subsidiaries |
| 99 |
| 410 |
| 475 |
| 1,084 |
Income tax benefit (expense) |
| 32 |
| (128) |
| (85) |
| (327) |
Equity earnings (losses), net of income tax |
| (4) |
| 20 |
| 42 |
| 59 |
Net income |
| 127 |
| 302 |
| 432 |
| 816 |
Losses attributable to noncontrolling interests |
| 6 |
| 17 |
| 34 |
| 22 |
Preferred dividends of subsidiaries |
| (2) |
| (2) |
| (7) |
| (7) |
Earnings | $ | 131 | $ | 317 | $ | 459 | $ | 83 1 |
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Basic earnings per common share | $ | 0.53 | $ | 1.30 | $ | 1.86 | $ | 3.42 |
Weighted-average number of shares outstanding, basic (thousands) |
| 246,668 |
| 243,925 |
| 246,513 |
| 242,806 |
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Diluted earnings per common share | $ | 0.53 | $ | 1.27 | $ | 1.84 | $ | 3.37 |
Weighted-average number of shares outstanding, diluted (thousands) |
| 249,811 |
| 248,461 |
| 249,773 |
| 246,875 |
Dividends declared per share of common stock | $ | 0.3 9 | $ | 0.39 | $ | 1.17 | $ | 1.17 |
See Notes to Condensed Consolidated Financial Statements. |
SEMPRA ENERGY
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in millions)
September 30,
December 31,
2010
2009
(unaudited)
ASSETS
Current assets:
td>
Cash and cash equivalents
$
547
$
110
Restricted cash
4
35
Trade accounts receivable
632
971
Other accounts and notes receivable
144
159
Due from unconsolidated affiliate
30
41
Income taxes receivable
312
221
Def erred income taxes
-
10
Inventories
296
197
Regulatory assets
97
54
Fixed-price contracts and other derivatives
84
77
Insurance receivable related to wildfire litigation (Note 10)
150
273
Other
199
147
Total current assets
2,495
2,295
Investments and other assets:
Restricted cash
27
-
Regulatory assets arising from fixed-price contracts and other derivatives
< font style="FONT-SIZE:9pt; COLOR:black; FONT-FAMILY:'Arial','sans-serif'">
241
241
Regulatory assets arising from pension and other postretirement
benefit obligations
950
959
Other regulatory assets
973
603
Nuclear decommissioning trusts
737
678
Investment in RBS Sempra Commodities LLP
825
2,172
Other investments
2,317
2,151
Goodwill and other intangible assets
542
524
Sundry
621
608
Total investments and other assets
7,233
7,936
Property, plant and equipment:
Property, plant and equi pment
26,286
25,034
Less accumulated depreciation and amortization
(7,065)
(6,753)
Property, plant and equipment, net ($523 at September 30, 2010 related to VIE)
19,221
18,281
Total assets
$
28,949
$
28,512
See Notes to Condensed Consolidated Financial Statements.
SEMPRA ENERGY | ||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||
(Dollars in millions) | ||||
| September 30, | December 31, | ||
| 2010 | 2009 | ||
&n bsp; | (unaudited) |
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LIABILITIES AND EQUITY |
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Current liabilities: |
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Short-term debt | $ | 574 | $ | 618 |
Accounts payable - trade |
| 572 |
| 522 |
Accounts payable - other |
| 130 |
| &n bsp;171 |
Due to unconsolidated affiliates |
| 12 |
| 29 |
Deferred income taxes |
| 16 |
| - |
Dividends and interest payable |
| 232 |
|
190 |
Accrued compensation and benefits | | 247 |
| 264 |
Regulatory balancing accounts, net |
| 242 |
| 382 |
Current portion of long-term debt |
| 313 |
| 573 |
Fixed-price contracts and other derivatives |
| 107 |
| 95 |
Customer deposits |
| 133 |
| 145 |
Reserve for wildfire litigation (Note 10) |
| 344 |
| 270 |
Other |
| 855 |
| 629 |
Total current liabilities |
| 3,77 7 |
| 3,888 |
Long-term debt ($357 at September 30, 2010 related to VIE) |
| 8,032 |
| 7,460 |
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Deferred credits and other liabilities: |
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Due to unconsolidated affiliate |
| - |
| 2 |
Customer advances for construction |
| 147 |
| 146 |
Pension and other postretirement benefit obligations, net of plan assets |
| 1,225 |
| 1,252 |
Deferred income taxes |
| 1,516 |
| 1,318 |
Deferred investment tax credits |
| 52 |
| 54 |
Regulatory liabilities arising from removal obligations |
| 2,635 |
| 2,557 |
Asset retirement obligations |
| 1,327 |
| 1,277 |
Other regulatory liabilities |
| 144 |
| 181 |
Fixed-price contracts and other derivatives |
| 336 |
| 312 |
Deferred credits and other |
| 672 |
| 735 |
Total deferred credits and other liabilities |
| 8,054 |
| 7,834 |
Contingently redeemable preferred stock of subsidiary |
| 79 |
| 79 |
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Commitments and contingencies (Note 10) |
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Equity: |
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Preferred stock (50 million shares authorized; none issued) |
| - |
| - |
Common stock (750 million shares authorized; 242 million and 247 million shares |
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outstanding at September 30, 2010 and December 31, 2009, respectively; no par |
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value) |
| 2,012 |
| 2,418 |
Retained earnings |
| 7,143 |
| 6,971 |
Deferred compensation |
| (9) |
| (13) |
Accumulated other comprehensive income (loss) |
| (344) |
| (369) |
Total Sempra Energy shareholders' equity |
| 8,802 |
| 9,007 |
Preferred stock of subsidiaries |
| 100 |
| 100 |
Other noncontrolling interests |
| 105 | &nb sp; | 144 |
Total equity |
| 9,007 |
| 9,251 |
Total liabilities and equity | $ | 28,949 | $ | 28,512 |
See Notes to Condensed Consolidated Financial Statements. |
SEMPRA ENERGY | ||||
CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS | ||||
(Dollars in millions) | ||||
| Nine months ended Se ptember 30, | |||
| 2010 | 2009 | ||
| (unaudited) | |||
CASH FLOWS FROM OPERATING ACTIVITIES |
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Net income | $ | 432 | $ | 816 |
Adjustments to reconcile net income to net cash provided |
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  ; by operating activities: |
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Depreciation and amortization |
| 643 |
| 568 |
Deferred income taxes and investment tax credits |
| 133 |
| 181 |
Equity losses (earnings) |
| 224 |
| (470) |
Write-off of long-lived assets |
| - |
| 132 |
Fixed-price contracts and other derivatives |
| 19 |
| (27) |
Other |
| (24) |
| 42 |
Net change in other working capital components |
| (77) |
| 220 |
Distributions from RBS Sempra Commodities LLP |
| 198 |
| 407 |
Changes in other assets |
| 76 | 81 | |
Changes in other liabilities |
| (22) |
| (66) |
Net cash provided by operating activities |
| 1,602 |
| 1,884 |
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CASH FLOWS FROM INVESTING ACTIVITIES |
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Expenditures for property, plant and equipment |
| (1,354) |
| (1,371) |
Proceeds from sale of assets |
| - |
| 179 |
Expenditures for investments and acquisition of businesses, net of cash acquired |
| (385) |
| (762) |
Distributions from RBS Sempra Commodities LLP |
| 849 |
| - |
Distributions from other investments |
| 2 59 |
| 16 |
Purchases of nuclear decommissioning and other trust assets |
| (261) |
| (167) |
Proceeds from sales by nuclear decommissioning and other trusts |
| 261 |
| 155 |
Other |
| (2) |
| (20) |
Net cash used in investing activities |
| (633) |
| (1,970) |
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CASH FLOWS FROM FIN ANCING ACTIVITIES |
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Common dividends paid |
| (269) |
| (255) |
Preferred dividends paid by subsidiaries |
| (7) |
| (7) |
Issuances of common stock |
| 29 |
| 52 |
& nbsp; Repurchases of common stock |
| (502) |
| - |
Increase (decrease) in short-term debt, net |
| 184 |
| (52) |
Issuances of debt (maturities greater than 90 days) |
| 771 |
| 1,181 |
Payments on debt (maturities greater than 90 days) |
| (727) |
| (325) |
Purchase of noncontrolling interest |
| - |
| (94) |
Other |
| (11) |
| 11 |
Net cash (used in) provided by financing activities |
| (532) |
| 511 |
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Increase in cash and cash equivalents |
| 437 |
| 425 |
Cash and cash equivalents, January 1 |
| 110 |
| 331 |
Cash and cash equivalents, September 30 | $ | 547 | $ | 756 |
See Notes to Condensed Consolidated Financial Statements. |
SEMPRA ENERGY | ||||
CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS < /td> | ||||
(Dollars in millions) | ||||
| Nine months ended September 30, | |||
| 2010 | 2009 | ||
| (unaudited) | |||
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION |
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Interest payments, net of amounts capitalized | $ | 264 | $ | 201 |
Income tax payments, net of refunds |
| 32 |
| 98 |
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SUPPLEMENTAL DISCLOSURE OF NONCASH ACTIVITIES |
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Acquisition of business: |
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Assets acquired | $ | 303 | $ | - |
Cash paid, net of cash acquired |
| &n bsp;(292) |
| - |
< font style="FONT-SIZE:9pt; COLOR:black; FONT-FAMILY:'Arial','sans-serif'"> Liabilities assumed | $ | 11 | $ | - |
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Increase in capital lease obligations for investments in property, plant and |
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tr>
equipment | $ | 183 | $ | 2 |
Dividends declared but not paid |
| 97 |
| 99 |
See Notes to Condensed Consolidated Financial Statements. |
SAN DIEGO GAS & ELECTRIC COMPANY | ||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
(Dollars in millions) | ||||||||
| Three months ended | Nine months ended | ||||||
| September 30, | September 30, | ||||||
| 2010 | 2009 | 2010 | |||||
| (unaudited) | |||||||
Operating revenues |
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Electric | $ | 718 | $ | 695 | $ | &nb sp;1,870 | $ | 1,783 |
Natural gas |
| 93 |
| 78 |
| 375 |
| 353 |
Total operating revenues |
| 811 |
| 773 |
| 2,245 |
| 2,136 |
Operating expenses |
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Cost of electric fuel and purchased power |
| 203 |
| 208 |
| 480 |
| 508 |
Cost of natural gas |
| 37 |
| 30 |
| 170 |
| 154 |
Operation and maintenance |
| 235 |
| 236 |
| 704 |
| 649 |
Depreciation and amortization |
| 96 |
| 81 |
| 283 | <
td style="BORDER-RIGHT:0px; PADDING-RIGHT:5.75pt; BORDER-TOP:0px; PADDING-LEFT:5.75pt; BACKGROUND:white; PADDING-BOTTOM:0in; BORDER-LEFT:0px; PADDING-TOP:0in; BORDER-BOTTOM:0px; HEIGHT:12pt" valign=bottom> 239 | |
Franchise fees and other taxes |
| 42 |
| 46 |
| 126 |
| 126 |
Total operating expenses |
| 613 |
| 601 |
| 1,763 |
| 1,676 |
Operating income |
| 198 |
| 172 |
| 482 |
| 460 |
Other income (expense), net |
| (2) |
| 1 |
| (18) |
| 45 |
Interest income |
| - |
| 1 |
| - |
| 1 |
Interest expense |
| (37) |
| < font style="FONT-SIZE:9pt; COLOR:black; FONT-FAMILY:'Arial','sans-serif'"> (29) |
| (99) |
| (75) |
Income before income taxes |
| 159 |
| 145 |
| 365 |
| 431 |
Income tax expense |
| (56) |
| (53) |
| (131) |
| (141) |
Net income |
| 103 |
| 92 |
| 234 |
| 290 |
Losses (earnings) attributable to noncontrolling interests |
| 5 |
| 18 |
| 34 |
| (9) |
Earnings |
| 108 |
| 110 |
| 268 |
| 281 |
Preferred dividend requirements |
| (2) |
| (2) |
| (4) |   ; | (4) |
Earnings attributable to common shares | $ | 106 | $ | 108 | $ | 264 | $ | 277 |
See Notes to Condensed Consolidated Financial Statements. |
SAN DIEGO GAS & ELECTRIC COMPANY | ||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||
(Dollars in millions) | ||||
| September 30, | December 31, | ||
| 2010 | 2009 | ||
| (unaudited) |
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ASSETS |
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Current assets: |
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Cash and cash equivalents | $ | 332 | $ | 13 |
Restricted cash |
| 4 |
| 8 |
Accounts receivable - trade |
| 216 |
| 229 |
Accounts receivable - other |
| 33 |
| 85 |
Due from unconsolidated affiliates |
| 4 |
| 8 |
Income taxes receivable |
| 114 |
| 59 |
Deferred income taxes |
| 36 |
| 41 |
Inventories |
| 67 |
| 61 |
Regulatory assets arising from fixed-price contracts and other derivat ives |
| 73 |
| 30 |
Other regulatory assets |
| 4 |
| 4 |
Fixed-price contracts and other derivatives |
| 29 |
| 40 |
| 150 |
| 273 | |
Other |
| 61 |
| 35 |
Total current assets | 1,123 |
| 886 | |
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Other assets: |
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< p style="MARGIN:0in 0in 0pt"> Due from unconsolidated affiliate |
| - |
| 2 |
Deferred taxes recoverable in rates |
| 474 |
| 415 |
Regulatory assets arising from fixed-price contracts and other derivatives |
| 241 |
| 241 |
Regulatory assets arising from pension and other postretirement |
|
|
|
|
benefit obligations |
| 331 |
| 342 |
Regulatory assets arising from wildfire litigation costs |
| 311 |
| - |
Other regulatory assets |
| 72 |
| 53 |
Nuclear decommissioning trusts | < /td> | 737 |
| 678 |
Sundry |
| 50 |
| 43 |
Total other assets |
| 2,216 |
| 1,774 |
|
|
|
|
|
Property, plant and equipment: |
|
|
|
|
Property, plant and equipment |
| 10,816 |
| 10,156 |
Less accumulated depreciation and amortization |
| (2,659) |
| (2,587) |
Property, plant and equipment, net ($523 at September 30, 2010 related to VIE) |
| 8,157 |
| 7,569 |
Total assets | $ | 11,496 | $ | 10,229 |
See Notes to Condensed Consolidated Financial Statements. |
SAN DIEGO GAS & ELECTRIC COMPANY | ||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||
(Dollars in millions) | ||||
| September 30, | December 31, | ||
| 2010 | 2009 | ||
| (unaudited) |
|
| |
LIABILITIES AND EQUITY |
|
|
|
|
Current liabilities: |
|
|
|
|
Short-term debt | $ | - | $ | 33 |
Accounts payable |
| 229 |
| 249 |
Due to unconsolidated affiliate |
| 21 |
| - |
Accrued compensation and benefits | &nbs p; | 93 |
| 104 |
Regulatory balancing accounts, net |
| 79 |
| 159 |
Current portion of long-term debt |
| 22 |
| 45 |
Fix ed-price contracts and other derivatives |
| 50 |
| 51 |
Customer deposits |
| 53 |
| 56 |
Reserve for wildfire litigation (Note 10) |
| 344 |
| 270 |
Other |
| 172 |
| 157 |
Total current liabilities |
| 1,063 |
| 1,124 |
Lo ng-term debt ($357 at September 30, 2010 related to VIE) |
| 3,473 |
| 2,623 |
|
|
|
|
|
Deferred credits and other liabilities: |
|
|
|
|
Customer advances for construction |
| 21 |
| 23 |
Pension and other postretirement benefit obligations, net of plan assets |
| 354 |
| 370 |
  ; Deferred income taxes |
| 953 |
| 774 |
Deferred investment tax credits |
| 26 |
| 26 |
Regulatory liabilities arising from removal obligations |
| 1,376 |
| 1,3 30 |
Asset retirement obligations |
| 601 |
| 585 |
Fixed-price contracts and other derivatives |
| 278 |
| 265 |
Deferred credits and other |
| 161 |
| 145 |
Total deferred credits and other liabilities |
| 3,770 |
| 3,518 |
Contingently redeemable preferred stock |
| 79 |
| 79 |
|
|
|
|
|
Commitments and contingencies (Note 10) |
|
|
|
|
|
|
|
|
|
Equity: |
|
|
|
|
Common stock (255 million shares authorized; 117 million shares outstanding; |
|
|
|
|
no par value) |
| 1,138 |
| 1,138 |
Retained earnings |
| 1,875 |
| 1,611 |
Accumulated other comprehensive income (loss) |
| (9) |
| (10) |
Total SDG&E shareholders' equity |
| 3,004 |
| 2,739 |
Noncontrolling interest |
| 107 |
| 146 |
Total equity |
| 3,111 |
| 2,885 |
Total liabilities and equity | $ | 11,496 | $ | 10,229 |
See Notes to Condensed Consolidated Financial Statements. |
SAN DIEGO GAS & ELECTRIC COMPANY
CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS
(Dollars in millions)
Nine months ended
September 30,
2010
2009
(unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income
$
234
$
290&nb sp;
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization
283
239
Deferred income taxes and investment tax credits
125
35
Fixed-price contracts and other derivatives
42
(28)
Other
(14)
Net change in other working capital components
(247)
115
Changes in other assets
15
20
Changes in other liabilities
(12)
(38)
Net cash provided by operating activities
416
619
CASH FLOWS FROM INVESTING ACTIVITIES
Expenditures for property, plant and equipment
(822)
(633)
Expenditures for short-term investments
-
(152)
Proceeds from sale of short-term investments
-
176
Purchases of nuclear decommissioning trust assets
(256)
(161)
Proceeds from sales by nuclear decommissioning trusts
248
155
Decrease in loans to affiliates, net
< font style="FONT-SIZE:9pt; COLOR:black; FONT-FAMILY:'Arial','sans-serif'">
13
33
Net decrease in restricted cash
4
-
Other
-&nbs p;
2
Net cash used in investing activities
(813)
(580)
CASH FLOWS FROM FINANCING ACTIVITIES
Common dividends paid
-
(150)
Capital contribution received by Otay Mesa VIE
-
4
Capital distribution made by Otay Mesa VIE
(10)
-
Preferred dividends paid
(4)
(4)
Issuances of long-term debt
744
386
Payments on long-term debt
(7)
-
Other
(7)
(3)
Net cash provided by financing activities
716
233
Increase in cash and cash equivalents
319
272
Cash and cash equivalents, January 1
13
19
Cash and cash equivalents, September 30
$
332
$
291
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Interest payments, net of amounts capitalized
$
67
$
51
Income tax payments, net of refunds
61
144
SUPPLEMENTAL DISCLOSURE OF NONCASH ACTIVITIES
Increase in capital lease obligations for investments in property, plant and
p>
  ; equipment
$
183
$
-
Dividends declared but not paid
1
1
See Notes to Condensed Consolidated Financial Statements.
PACIFIC ENTERPRISES AND SUBSIDIARIES | ||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||
(Dollars in millions) | ||||||||
| Three months ended | Nine months ended | ||||||
| September 30, | September 30, | ||||||
| 2010 | 2009 | 2010 | 2009 | ||||
| (unaudited) | |||||||
|
|
|
|
|
|
|
|
|
Operating revenues | $ | 776 | $ | 662 | $ | 2,792 | $ | 2,276 |
Operating expenses |
|
|
|
|
|
|
|
|
Cost of natural gas |
| 252 |
| 180 |
| 1,244 |
| 849 |
Operation and maintenance |
| 283 |
| 249 |
| 838 |
| 766 |
Depreciation |
| 78 |
| 73 |
| 230 |
| 220 |
Franchise fees and other taxes |
| 27 |
| 25 |
| 92 |
| 81 |
Total operating expenses |
| 640 |
| 527 |
| 2,404 |
| 1,916 |
Operating income |
| 136 |
| 135 |
| 388 |
| 360 |
Other income (expense), net |
| 2 |
| (4) |
| 8 |
| 1 |
Interest income |
| - |
| - | &n bsp; | 1 |
| 3 |
Interest expense |
| (17) |
| (17) |
| (50) |
| (52) |
Income before income taxes |
| 121 |
| 114 |
| 347 |
| 312 |
Income tax expense |
| (42) |
| (41) |
| (132) |
| (117) |
Net income |
| 79 |
| 73 |
| 215 |
| 195 |
Preferred dividends of subsidiary |
| - |
| - |
| (1) |
| (1) |
Earnings |
| 79 |
| 73 |
| 214 |
| 194 |
Preferred dividend requirements |
| (1) |
| (1) |
| (3) |
| (3) |
Earnings attributable to common shares | $ | 78 | $ | 72 | $ | 211 | $ | 191 |
See Notes to Condensed Consolidated Financial Statements. |
PACIFIC ENTERPRISES AND SUBSIDIARIES | ||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||
(Dollars in millions) | ||||
font> | September 30, | December 31, | ||
| 2010 | 2009 | ||
| (unaudited) |
|
| |
ASSETS |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents | $ | 72 | $ | 49&nbs p; |
Accounts receivable - trade |
| 302 |
| 567 |
Accounts receivable - other |
| 57 |
| 44 |
Due from unconsolidated affiliates |
| 118 |
| |
Income taxes receivable |
| 23 |
| 36 |
Inventories |
| 181 |
| 93 |
Other regulatory assets |
| 10 |
| 9 |
Other |
| 35 |
| 39 |
Total current assets |
| 798 |
| 849 |
|
|
|
|
|
Other assets: |
|
|
|
|
  ; Due from unconsolidated affiliate |
| 504 |
| 513 |
Regulatory assets arising from pension and other postretirement |
|
|
|
|
benefit obligations |
| 614 |
| 617 |
Other regulatory assets |
| 114 |
| 131 |
Sundry |
| 38 |
| 40 |
Total other assets |
| 1,270 |
| 1,301 |
|
|
|
|
|
Property, plant and equipment: |
|
|
|
|
Property, plant and equipment |
| 9,558 |
| 9,299 |
Less accumulated depreciation and amortization |
| (3,735) | < /p> | (3,615) |
Property, plant and equipment, net |
| 5,823 |
| 5,684 |
Total assets | $ | 7,891 | $ | 7,834 |
See Notes to Condensed Consolidated Financial Statements. |
PACIFIC ENTERPRISES AND SUBSIDIARIES | ||||
CONDENSED CONSOLIDATED BALANCE SHEETS | ||||
(Dollars in millions) | ||||
| September 30, | December 31, | ||
| 2010 | 2009 | ||
< p style="MARGIN:0in 0in 0pt"> | (unaudited) | &n bsp; |
| |
LIABILITIES AND EQUITY |
|
|
|
|
Current liabilities: |
|
|
|
|
Accounts payable - trade | $ | 167 | $ | 207 |
Accounts payable - other |
| 77 |
| 120 |
Due to unconsolidated affiliates |
| 87 |
| 87 |
Deferred income taxes |
| 3 |
| 5 |
Accrued compensation and benefits |
| 89 |
| 86 |
Regulatory balancing accounts, net |
| 163 |
| 223 |
Current portion of long-term debt |
| 260 |
| 11 |
Customer deposits |
| 77 |
| 87 |
Other |
| 193 |
| 162 |
Total current liabilities |
| 1,116 |
| 988 |
Long-term debt |
| 1,021 |
| 1,283 |
Deferred credits and other liabilities: |
|
|
|
|
Customer advances for construction |
| 125 |
| 123 |
Pension and other postretirement benefit obligations, net of plan assets |
| 643 |
| 644 |
Deferred income taxes |
| 373 |
| 273 |
&nb sp; Deferred investment tax credits |
| 26 |
| 28 |
Regulatory liabilities arising from removal obligations |
| 1,247 |
| 1,227 |
Asset retirement obligations |
| 690 |
| 662 |
Deferred taxes refundable in rates |
| 144 |
| 175 |
Deferred credits and other |
| 165 |
| 203 |
&nbs p; Total deferred credits and other liabilities |
| 3,413 |
| 3,335 |
|
|
|
|
|
Commitments and contingencies (Note 10) |
|
|
|
|
|
|
|
|
|
Equity: |
|
|
|
|
Preferred stock |
| 80 |
| 80 |
Common stock (600 million shares authorized; 84 million shares outstanding; |
|
|
|
|
no par value) |
| 1,462 |
| 1,462 |
Retained earnings |
| 802 |
| 691 |
Accumulated other comprehensive income (loss) |
| (23) |
| (25) |
Total Pacific Enterprises shareholders' equity |
| 2,321 |
| 2,208 |
Preferred stock of subsidiary |
| 20 |
| 20 |
Total equity |
| 2,341 |
| 2,228 |
Total liabilities and equity< /p> | $ | 7,891 | $ | 7,834 |
See Notes to Condensed Consolidated Financial Statements. |
PACIFIC ENTERPRISES AND SUBSIDIARIES | ||||
CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS | ||||
(Dollars in millions) | ||||
| Nine months ended September 30, | |||
| 2010 | 2009 | ||
| (unaudited) | |||
CASH FLOWS FROM OPERATING ACTIVITIES |
|
|
|
|
Net income | $ | 215 | $ | 195 |
Adjustments to reconcile net income to net cash provided by |
|
|
|