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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 27, 2020


SEMPRA ENERGY
(Exact name of registrant as specified in its charter)


California1-1420133-0732627
(State or other jurisdiction of incorporation)(Commission File Number)(IRS Employer Identification No.)

488 8th Avenue, San Diego, California
92101
(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))

SECURITIES REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
Title of Each ClassTrading SymbolName of Each Exchange on Which Registered
Sempra Energy Common Stock, without par valueSRE NYSE
Sempra Energy 6% Mandatory Convertible Preferred Stock, Series A, $100 liquidation preferenceSREPRANYSE
Sempra Energy 6.75% Mandatory Convertible Preferred Stock, Series B, $100 liquidation preferenceSREPRBNYSE
Sempra Energy 5.75% Junior Subordinated Notes Due 2079, $25 par valueSREANYSE

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR 230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR 240.12b-2).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐






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 February 27, 2020, Sempra Energy issued a press release announcing consolidated earnings of $447 million, or $1.55 per diluted share of common stock, for the fourth quarter of 2019. 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 Segment for the three months and years ended December 31, 2019 and 2018. A copy of such information is attached as Exhibit 99.2.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

Exhibit NumberExhibit Description
99.1
99.2
104Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)




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 hereunto duly authorized.


SEMPRA ENERGY,
(Registrant)
Date: February 27, 2020By: /s/ Peter R. Wall
Peter R. Wall
Vice President, Controller and Chief Accounting Officer





Document

Exhibit 99.1

https://cdn.kscope.io/3098db8904f4421a8f4db53c9745ff25-sempragraphic21.gif
NEWS RELEASE


Media Contact:Linda Pazin
Sempra Energy
(877) 340-8875
www.sempra.com
Financial Contact:Adam Pierce
Sempra Energy
(877) 736-7727
investor@sempra.com

SEMPRA ENERGY REPORTS STRONG 2019
FINANCIAL AND OPERATING RESULTS

Exceeds Full-Year 2019 EPS Guidance Range
Increases Common Stock Dividend by 8%
Achieves Substantial Completion of Cameron LNG Train 2,
Commercial Operations Expected in Coming Days

SAN DIEGO, Feb. 27, 2020 – Sempra Energy (NYSE: SRE) today reported full-year 2019 earnings of $2.1 billion, or $7.29 per diluted share, up from $924 million, or $3.42 per diluted share, in 2018. On an adjusted basis, the company’s full-year 2019 earnings were $1.9 billion, or $6.78 per diluted share, compared to $1.5 billion, or $5.57 per diluted share, in 2018.
“This year has been one of the strongest in our company’s history,” said Jeffrey W. Martin, chairman and CEO of Sempra Energy. “Our earnings results are a direct reflection of our sharper strategic focus and ongoing execution of our mission to be North America’s premier energy infrastructure company. Supported by our high-performance culture, our dedicated employees will carry this momentum into 2020 as we continue to focus on our vision of delivering energy with purpose by connecting millions of consumers to safe, resilient and affordable energy.”
In the fourth quarter 2019, Sempra Energy reported earnings of $447 million, or $1.55 per diluted share, compared with earnings of $864 million, or $3.03 per diluted share, in the fourth quarter 2018. On an adjusted basis, fourth quarter 2018 earnings were $431 million, or $1.56 per diluted share.
These financial results reflect certain significant items, as described on an after-tax basis in the following table of GAAP earnings, reconciled to adjusted earnings, for the fourth quarter and full-year 2019 and 2018.
 Three months ended Years ended
December 31,December 31,
(Dollars, except EPS, and shares, in millions)2019
2018(1)
2019
2018(1)
 (Unaudited)
GAAP Earnings
$447  $864  $2,055  $924  
Tax Impacts from Expected Sale of South American Businesses —  —  (99) —  
Gain on Sale of Certain Sempra Renewables Assets—  (367) (45) (367) 
(Adjustment)/Impairment of U.S. Non-utility Natural Gas Storage Assets—  (126) —  629  
Impairment of U.S. Wind Equity Method Investments—  —  —  145  
Impact from the Tax Cuts and Jobs Act of 2017—  60  —  85  
Impairment of Investment in RBS Sempra Commodities—  —  —  65  
Impacts Associated with Aliso Canyon Litigation—  —  —  22  
Adjusted Earnings(2)
$447  $431  $1,911  $1,503  
Diluted Weighted-Average Common Shares Outstanding289  296  282  270  
GAAP Earnings Per Diluted Common Share
$1.55  $3.03  
(3)
$7.29  $3.42  
Adjusted Diluted Weighted-Average Common Shares Outstanding(2)
289  276  
(3)
282  270  
Adjusted Earnings per Diluted Common Share(2)
$1.55  $1.56  $6.78  $5.57  
1)Amounts have been retrospectively adjusted for discontinued operations.
2)Sempra Energy Adjusted Earnings, Adjusted EPS and Adjusted Diluted Weighted-Average Common Shares Outstanding are non-GAAP financial measures. See Table A for information regarding non-GAAP financial measures and descriptions of the adjustments above.
3)Due to the dilutive effect of the mandatory convertible preferred stock for GAAP earnings, the numerator used to calculate GAAP EPS includes an add-back of $36 million of mandatory preferred stock dividends declared in the quarter. However, because the assumed conversion is antidilutive for the lower Adjusted Earnings, ~20 million preferred stock shares are not included in the denominator used to calculate Adjusted EPS for the quarter.

Earlier this week, Sempra Energy’s board of directors approved an 8% increase to the company’s dividend, to $4.18 per common share from $3.87 per common share, on an annualized basis. On average, Sempra Energy has increased its dividend by more than 10% annually for the last decade.
OPERATING HIGHLIGHTS
The company made progress on its strategy to focus on transmission and distribution infrastructure in the most attractive markets in North America.
In January, the California Public Utilities Commission issued a final decision approving an extension of the General Rate Case (GRC) cycle to four years on a go-forward basis. This change applies to San Diego Gas & Electric’s (SDG&E) and Southern California Gas Co.’s recently approved GRC. As a transitional step, both utilities’ GRC cycle will be extended to five years, covering the years 2019 through 2023. Extending the GRC cycle is a constructive development that is expected to benefit all stakeholders by delivering future visibility to the utilities’ robust capital programs to enhance safety and resilience.
Earlier this month, SDG&E filed its comprehensive 2020 Wildfire Mitigation Plan, a strategic three-year program. This program is a continuation of SDG&E’s efforts over the last decade to help mitigate infrastructure-related wildfires and to help increase the safety of its customers, workforce and the communities it serves. The 2020 Wildfire Mitigation Plan includes initiatives announced in October under SDG&E’s Fire Safe 3.0 program, an innovative portfolio of continuous improvement initiatives to increase wildfire safety. The Fire Safe 3.0 program involves partnering with academic, government and public safety professionals to implement artificial intelligence, satellite wildfire alerts and a new Vegetation Risk index, among other strategies.
To meet the growing needs of its customers in Texas, Oncor Electric Delivery Co. LLC (Oncor) recently announced a new five-year capital plan of approximately $11.9 billion. The increase will help to support population growth in West Texas and the Dallas-Fort Worth area, as well as to strengthen and expand the grid in Oncor’s service territory. Additionally, Sempra Energy took a positive step in growing its presence in Texas through the announcement of a new “Center of Excellence” in Houston. The office, which is expected to open later this year, will serve as a regional headquarters as Sempra Energy advances its high-growth business strategy in Texas.
Sempra Energy continues to be focused on its goal of developing liquefied natural gas (LNG) infrastructure that can deliver up to 45 million tonnes per annum (Mtpa) of LNG to the largest world markets, which would make Sempra Energy one of North America's largest developers of LNG-export infrastructure projects.
Train 2 of the Cameron LNG liquefaction-export infrastructure project recently achieved substantial completion and is expected to commence commercial operations under Cameron LNG's tolling agreements in the coming days. The facility began producing LNG from Train 2 in December 2019. Train 1 began commercial operations in August 2019 and Train 3 remains on schedule and is expected to start commercial operations in the third quarter of 2020. Sempra Energy's share of full-year run-rate earnings from the first three trains at Cameron LNG are projected to be between $400 million and $450 million annually after all three trains achieve commercial operations under Cameron LNG's tolling agreements.
The potential Port Arthur LNG liquefaction-export infrastructure project under development in Jefferson County, Texas, continues to advance with a final investment decision targeted for third quarter 2020. In January, Sempra LNG
signed an Interim Project Participation Agreement (IPPA) with Aramco Services Company, a subsidiary of Saudi Aramco, for the proposed Port Arthur LNG project. The IPPA represents another milestone for both companies after having signed a heads of agreement in May 2019 for the potential purchase of 5 Mtpa of LNG and a 25% equity investment in the project. In December 2018, Port Arthur LNG entered into an agreement with Polish Oil & Gas Company for the sale and purchase of 2 Mtpa of LNG per year.
A final investment decision for the Energía Costa Azul (ECA) LNG liquefaction-export infrastructure project, under development in Baja California, Mexico, is expected later this quarter. TechnipFMC has been selected as the engineering, procurement and construction (EPC) contractor for the proposed project. ECA LNG expects to sign a lump-sum, turn-key EPC contract for Phase 1 of the project in the coming days.
In 2019, Sempra Energy announced two agreements that would conclude the company’s planned sale of its South American businesses for combined expected after-tax proceeds of approximately $4.55 to $4.85 billion in cash, subject to adjustments and satisfaction of closing conditions. Both transactions, one to sell Sempra Energy’s equity interests in its Peruvian businesses and the other to sell its equity interests in its Chilean businesses, continue to advance and are expected to be completed in the next four to eight weeks.
EARNINGS GUIDANCE
Sempra Energy’s full-year 2020 GAAP EPS guidance range is $12.78 to $14.26 and includes the estimated gain on the sale of the company’s South American businesses. Today, the company affirmed its full-year 2020 adjusted EPS guidance range of $6.70 to $7.50. Sempra Energy also issued its full-year 2021 EPS guidance range of $7.50 to $8.10.
NON-GAAP FINANCIAL MEASURES
Non-GAAP financial measures include Sempra Energy’s adjusted earnings and adjusted EPS for the fourth quarter of 2018 and full-year 2019 and 2018, adjusted diluted weighted-average common shares outstanding for the fourth quarter of 2018, and 2020 adjusted EPS guidance range. See Table A for additional information regarding these non-GAAP financial measures.
INTERNET BROADCAST
Sempra Energy will broadcast a live discussion of its earnings results over the Internet today at 12 p.m. ET with senior management of the company. Access is available by logging onto the website 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 1455338.
ABOUT SEMPRA ENERGY
Sempra Energy's mission is to be North America's premier energy infrastructure company. With more than $65 billion in total assets reported in 2019, the San Diego-based company is the utility holding company with the largest U.S. customer base. The Sempra Energy companies' more than 20,000 employees deliver energy with purpose to over 40 million consumers worldwide. The company is focused on the most attractive markets in North America, including California, Texas, Mexico and the LNG export market. Sempra Energy has been consistently recognized for its leadership in diversity and inclusion, and sustainability, and is a member of the S&P 500 Utilities Index and the Dow Jones Utility Index. The company was also named one of the “World’s Most Admired Companies” for 2020 by Fortune Magazine.
###

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 such as "believes," "expects," "anticipates," "plans," "estimates," "projects," "forecasts," "should," "could," "would," "will," "confident," "may," "can," "potential," "possible," "proposed," "target," "pursue," "outlook," "maintain," or similar expressions, or when we discuss our guidance, strategy, goals, vision, mission, opportunities, projections or intentions. Forward-looking statements are based on assumptions with respect to the future, involve risks and uncertainties, and are not guarantees of performance. Future results may differ materially from those expressed in the forward-looking statements.
Factors, among others, that could cause our actual results and future actions to differ materially from those described in any forward-looking statements include risks and uncertainties relating to: California wildfires and the risk that we may be found liable for damages regardless of fault and the risk that we may not be able to recover any such costs from insurance, the wildfire fund established by California Assembly Bill 1054 or in rates from customers; decisions, investigations, regulations, issuances of permits and other authorizations, renewal of franchises, and other actions by the Comisión Federal de Electricidad, California Public Utilities Commission, U.S. Department of Energy, Public Utility Commission of Texas, regulatory and governmental bodies and jurisdictions in the U.S. and other countries in which we operate; the success of business development efforts, construction projects and major acquisitions and divestitures, including risks in (i) the ability to make a final investment decision and completing construction projects on schedule and budget; (ii) obtaining the consent of partners; (iii) counterparties' financial or other ability to fulfill contractual commitments; (iv) the ability to complete contemplated acquisitions and/or divestitures; and (v) the ability to realize anticipated benefits from any of these efforts once completed; the resolution of civil and criminal litigation, regulatory investigations and proceedings and arbitrations; actions by credit rating agencies to downgrade our credit ratings or to place those ratings on negative outlook and our ability to borrow at favorable interest rates; moves to reduce or eliminate reliance on natural gas; weather, natural disasters, accidents, equipment failures, computer system outages and other events that disrupt our operations, damage our facilities and systems, cause the release of harmful materials, cause fires and subject us to liability for property damage or personal injuries, fines and penalties, some of which may not be covered by insurance (including costs in excess of applicable policy limits), may be disputed by insurers or may otherwise not be recoverable through regulatory mechanisms or may impact our ability to obtain satisfactory levels of affordable insurance; the availability of electric power and natural gas and natural gas storage capacity, including disruptions caused by failures in the transmission grid, limitations on the withdrawal or injection of natural gas from or into storage facilities, and equipment failures; cybersecurity threats to the energy grid, storage and pipeline infrastructure, the information and systems used to operate our businesses, and the confidentiality of our proprietary information and the personal information of our customers and employees; expropriation of assets, the failure of foreign governments and state-owned entities to honor the terms of contracts, and property disputes; the impact at San Diego Gas & Electric Company on competitive customer rates and reliability due to the growth in distributed power generation and from departing retail load resulting from customers transferring to Direct Access, Community Choice Aggregation or other forms of distributed power generation and the risk of nonrecovery for stranded assets and contractual obligations; Oncor Electric Delivery Company LLC's (Oncor) ability to eliminate or reduce its quarterly dividends due to regulatory and governance requirements and commitments, including by actions of Oncor’s independent directors or a minority member director; volatility in foreign currency exchange, interest and inflation rates and commodity prices and our ability to effectively hedge the risk of such volatility; changes in trade policies, laws and regulations, including tariffs and revisions to or replacement of international trade agreements, such as the North American Free Trade Agreement, that may increase our costs or impair our ability to resolve trade disputes; the impact of changes to federal and state tax laws and our ability to mitigate adverse impacts; and other uncertainties, some of which may be difficult to predict and are beyond our control.
These risks and uncertainties are further discussed in the reports that Sempra Energy has filed with the U.S. Securities and Exchange Commission (SEC). 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, www.sempra.com. Investors should not rely unduly on any forward-looking statements. These forward-looking statements speak only as of the date hereof, and the company undertakes no obligation to update or revise any of these forward-looking statements as a result of new information, future events or other factors.
Sempra South American Utilities, Sempra North American Infrastructure, Sempra LNG, Sempra Mexico, Sempra Texas Utilities, Oncor and Infraestructura Energética Nova, S.A.B. de C.V. (IEnova) are not the same companies as the California utilities, San Diego Gas & Electric Company (SDG&E) or Southern California Gas Company, and Sempra South American Utilities, Sempra North American Infrastructure, Sempra LNG, Sempra Mexico, Sempra Texas Utilities, Oncor and IEnova are not regulated by the California Public Utilities Commission.





SEMPRA ENERGY
Table A
CONSOLIDATED STATEMENTS OF OPERATIONS
Three months ended
December 31,
Years ended
December 31,
(Dollars in millions, except per share amounts; shares in thousands) 2019
2018(1)
2019
2018(1)
(unaudited) 
REVENUES
Utilities$2,640  $2,427  $9,448  $8,539  
Energy-related businesses303  399  1,381  1,563  
Total revenues2,943  2,826  10,829  10,102  
EXPENSES AND OTHER INCOME
Utilities:
Cost of natural gas(350) (426) (1,139) (1,208) 
Cost of electric fuel and purchased power(259) (321) (1,188) (1,358) 
Energy-related businesses cost of sales(79) (99) (344) (357) 
Operation and maintenance(951) (875) (3,466) (3,150) 
Depreciation and amortization(395) (376) (1,569) (1,491) 
Franchise fees and other taxes(127) (120) (496) (472) 
Impairment losses—  182  (43) (1,122) 
Gain on sale of assets—  513  63  513  
Other (expense) income, net(26) (134) 77  58  
Interest income23  19  87  85  
Interest expense(280) (230) (1,077) (886) 
Income from continuing operations before income taxes and equity earnings
499  959  1,734  714  
Income tax (expense) benefit(165) (172) (315) 49  
Equity earnings95  126  580  175  
Income from continuing operations, net of income tax429  913  1,999  938  
Income from discontinued operations, net of income tax71  51  363  188  
Net income500  964  2,362  1,126  
Earnings attributable to noncontrolling interests(18) (64) (164) (76) 
Mandatory convertible preferred stock dividends(35) (36) (142) (125) 
Preferred dividends of subsidiary—  —  (1) (1) 
Earnings attributable to common shares$447  $864  $2,055  $924  
Basic earnings per common share (EPS):
Earnings$1.57  $3.15  $7.40  $3.45  
Weighted-average common shares outstanding284,649  274,331  277,904  268,072  
Diluted EPS:
Earnings$1.55  $3.03  $7.29  $3.42  
Weighted-average common shares outstanding288,787  296,429  282,033  269,852  
(1) Amounts have been retrospectively adjusted for discontinued operations.





SEMPRA ENERGY
Table A (Continued)
RECONCILIATION OF SEMPRA ENERGY ADJUSTED EARNINGS TO SEMPRA ENERGY GAAP EARNINGS (Unaudited)
Sempra Energy Adjusted Earnings and Adjusted EPS exclude items (after the effects of income taxes and, if applicable, noncontrolling interests) in 2019 and 2018 as follows:
Three months ended December 31, 2018:
$367 million gain on the sale of certain Sempra Renewables assets
$126 million reduction in the impairment of certain non-utility natural gas storage assets in the southeast U.S. at Sempra LNG
$(60) million income tax expense in 2018 to adjust the Tax Cuts and Jobs Act of 2017 (TCJA) provisional amounts recorded in 2017
Year ended December 31, 2019:
$45 million gain on the sale of certain Sempra Renewables assets
Associated with holding the South American businesses for sale:
$89 million income tax benefit from outside basis differences in our South American businesses primarily related to the change in our indefinite reinvestment assertion from our decision in January 2019 to hold those businesses for sale and a change in the anticipated structure of the sale
$10 million income tax benefit to reduce a valuation allowance against certain net operating loss (NOL) carryforwards as a result of our decision to sell our South American businesses
Year ended December 31, 2018:
$367 million gain on the sale of certain Sempra Renewables assets
$(22) million impacts associated with Aliso Canyon natural gas storage facility litigation at Southern California Gas Company (SoCalGas)
$(145) million other-than-temporary impairment of certain U.S. wind equity method investments at Sempra Renewables
$(629) million impairment of certain non-utility natural gas storage assets at Sempra LNG
$(65) million impairment of RBS Sempra Commodities LLP (RBS Sempra Commodities) equity method investment at Parent and Other
$(85) million income tax expense in 2018 to adjust the TCJA provisional amounts recorded in 2017

Sempra Energy Adjusted Earnings, Weighted-Average Common Shares Outstanding – Adjusted and Adjusted EPS are non-GAAP financial measures (GAAP represents accounting principles generally accepted in the United States of America). Because of the significance and/or nature of the excluded items, management believes that these non-GAAP financial measures provide a meaningful comparison of the performance of Sempra Energy’s business operations to prior and future 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 for historical periods these non-GAAP financial measures to Sempra Energy GAAP Earnings, Weighted-Average Common Shares Outstanding – GAAP and GAAP Diluted Earnings Per Common Share (GAAP EPS), which we consider to be the most directly comparable financial measures calculated in accordance with GAAP.





SEMPRA ENERGY
Table A (Continued)
Pretax amount
Income tax expense
  (benefit)(1)
EarningsPretax amount
Income tax expense
  (benefit)(1)
Non-controlling interestsEarnings
(Dollars in millions, except per share amounts; shares in thousands)Three months ended December 31, 2019Three months ended December 31, 2018
Sempra Energy GAAP Earnings$447  $864  
Excluded items:
   Gain on sale of certain Sempra Renewables assets$—  $—  —  $(513) $146  $—  (367) 
   Reduction of impairment of non-utility natural gas storage assets—  —  —  (183) 47  10  (126) 
   Impact from the TCJA—  —  —  —  60  —  60  
Sempra Energy Adjusted Earnings$447  $431  
Diluted EPS:
   Sempra Energy GAAP Earnings(2)
$447  $900  
   Weighted-average common shares outstanding, diluted – GAAP288,787  296,429  
   Sempra Energy GAAP EPS$1.55  $3.03  
   Sempra Energy Adjusted Earnings for Adjusted EPS$431  
   Weighted-average common shares outstanding, diluted – Adjusted(2)
276,230  
   Sempra Energy Adjusted EPS$1.56  
Year ended December 31, 2019Year ended December 31, 2018
Sempra Energy GAAP Earnings$2,055  $924  
Excluded items:
   Gain on sale of certain Sempra Renewables assets
$(61) $16  (45) $(513) $146  $—  (367) 
   Associated with holding the South American businesses for sale:
Change in indefinite reinvestment assertion of basis differences and structure of sale of discontinued operations—  (89) (89) —  —  —  —  
Reduction in tax valuation allowance against certain NOL carryforwards—  (10) (10) —  —  —  —  
   Impacts associated with Aliso Canyon litigation—  —  —   21  —  22  
   Impairment of U.S. wind equity method investments—  —  —  200  (55) —  145  
   Impairment of non-utility natural gas storage assets—  —  —  1,117  (452) (36) 629  
   Impairment of investment in RBS Sempra Commodities—  —  —  65  —  —  65  
   Impact from the TCJA—  —  —  —  85  —  85  
Sempra Energy Adjusted Earnings$1,911  $1,503  
Diluted EPS:
   Weighted-average common shares outstanding, diluted GAAP
282,033  269,852  
   Sempra Energy GAAP EPS$7.29  $3.42  
   Sempra Energy Adjusted EPS$6.78  $5.57  
(1)
Except for adjustments that are solely income tax and tax related to outside basis differences, income taxes on pretax amounts were primarily calculated based on applicable statutory tax rates.
(2)
In the three months ended December 31, 2018, because the assumed conversion of the mandatory convertible preferred stock is dilutive for GAAP Earnings, the numerator used to calculate GAAP EPS includes an add-back of $36 million of mandatory convertible preferred stock dividends declared in that quarter. However, because the assumed conversion is antidilutive for the lower Adjusted Earnings, 20,199 mandatory convertible preferred stock shares are not included in the denominator used to calculate Adjusted EPS.




SEMPRA ENERGY
Table A (Continued)
RECONCILIATION OF SEMPRA ENERGY 2020 ADJUSTED EPS GUIDANCE RANGE TO SEMPRA ENERGY 2020 GAAP EPS GUIDANCE RANGE (Unaudited)
Sempra Energy 2020 Adjusted EPS Guidance Range of $6.70 to $7.50 excludes approximately $1.8 billion to $2.0 billion estimated after-tax gain on the sale of our South American businesses, net of approximately $1.2 billion of income tax expense, which was calculated primarily based on applicable statutory tax rates.

Sempra Energy 2020 Adjusted EPS Guidance is a non-GAAP financial measure. Because of the significance and/or nature of the excluded item, management believes that this non-GAAP financial measure provides a meaningful comparison of the performance of Sempra Energy's business operations to prior and future periods. Sempra Energy 2020 Adjusted EPS Guidance should not be considered an alternative to Sempra Energy 2020 GAAP EPS Guidance. 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 Sempra Energy 2020 Adjusted EPS Guidance Range to Sempra Energy 2020 GAAP EPS Guidance Range, which we consider to be the most directly comparable financial measure calculated in accordance with GAAP.
Full-Year 2020
Sempra Energy GAAP EPS Guidance Range$12.78  to$14.26  
Excluded item:
Estimated gain on sale of South American businesses(6.08) (6.76) 
Sempra Energy Adjusted EPS Guidance Range$6.70  to$7.50  
Weighted-average common shares outstanding, diluted (millions)295





SEMPRA ENERGY
Table B
CONSOLIDATED BALANCE SHEETS
December 31,December 31,
(Dollars in millions)2019
2018(1)
ASSETS
Current assets:
Cash and cash equivalents$108  $102  
Restricted cash31  35  
Accounts receivable – trade, net1,261  1,215  
Accounts receivable – other, net455  320  
Due from unconsolidated affiliates32  37  
Income taxes receivable112  60  
Inventories277  258  
Regulatory assets222  138  
Greenhouse gas allowances72  59  
Assets held for sale—  713  
Assets held for sale in discontinued operations445  459  
Other current assets324  249  
Total current assets3,339  3,645  
Other assets:
Restricted cash 21  
Due from unconsolidated affiliates742  644  
Regulatory assets1,930  1,589  
Nuclear decommissioning trusts1,082  974  
Investment in Oncor Holdings11,519  9,652  
Other investments2,103  2,320  
Goodwill1,602  1,602  
Other intangible assets213  224  
Dedicated assets in support of certain benefit plans488  416  
Insurance receivable for Aliso Canyon costs339  461  
Deferred income taxes155  141  
Greenhouse gas allowances470  289  
Right-of-use assets – operating leases591  —  
Wildfire fund392  —  
Assets held for sale in discontinued operations3,513  3,259  
Other long-term assets732  962  
Total other assets25,874  22,554  
Property, plant and equipment, net36,452  34,439  
Total assets$65,665  $60,638  
(1) Amounts have been retrospectively adjusted for discontinued operations.




SEMPRA ENERGY
Table B (Continued)
CONSOLIDATED BALANCE SHEETS
December 31,December 31,
(Dollars in millions)2019
2018(1)
LIABILITIES AND EQUITY
Current liabilities:
Short-term debt$3,505  $2,024  
Accounts payable – trade1,234  1,160  
Accounts payable – other179  138  
Due to unconsolidated affiliates 10  
Dividends and interest payable515  480  
Accrued compensation and benefits476  440  
Regulatory liabilities319  105  
Current portion of long-term debt and finance leases1,526  1,644  
Reserve for Aliso Canyon costs 160  
Greenhouse gas obligations72  59  
Liabilities held for sale in discontinued operations444  368  
Other current liabilities866  935  
Total current liabilities9,150  7,523  
Long-term debt and finance leases20,785  20,903  
Deferred credits and other liabilities:
Due to unconsolidated affiliates 195  37  
Pension and other postretirement benefit plan obligations, net of plan assets1,067  1,143  
Deferred income taxes2,577  2,321  
Deferred investment tax credits21  24  
Regulatory liabilities 3,741  4,016  
Asset retirement obligations2,923  2,786  
Greenhouse gas obligations301  131  
Liabilities held for sale in discontinued operations1,052  1,013  
Deferred credits and other2,048  1,493  
Total deferred credits and other liabilities13,925  12,964  
Equity:
Sempra Energy shareholders’ equity19,929  17,138  
Preferred stock of subsidiary20  20  
Other noncontrolling interests1,856  2,090  
Total equity21,805  19,248  
Total liabilities and equity$65,665  $60,638  
(1) Amounts have been retrospectively adjusted for discontinued operations.




SEMPRA ENERGY
Table C
CONSOLIDATED STATEMENTS OF CASH FLOWS
Years ended December 31,
(Dollars in millions)2019
2018(1)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income$2,362  $1,126  
Less: Income from discontinued operations, net of income tax(363) (188) 
Income from continuing operations, net of income tax1,999  938  
Adjustments to reconcile net income to net cash provided by operating activities1,259  1,878  
Net change in other working capital components(207) 433  
Insurance receivable for Aliso Canyon costs122  (43) 
Wildfire fund, current and noncurrent(323) —  
Changes in other noncurrent assets and liabilities, net(152) 14  
Net cash provided by continuing operations2,698  3,220  
Net cash provided by discontinued operations390  296  
Net cash provided by operating activities3,088  3,516  
CASH FLOWS FROM INVESTING ACTIVITIES
Expenditures for property, plant and equipment(3,708) (3,544) 
Expenditures for investments and acquisitions, net of cash and cash equivalents acquired(1,797) (10,168) 
Proceeds from sale of assets899  1,580  
Purchases of nuclear decommissioning trust assets(914) (890) 
Proceeds from sales of nuclear decommissioning trust assets914  890  
Advances to unconsolidated affiliates(16) (95) 
Repayments of advances to unconsolidated affiliates  
Intercompany activities with discontinued operations, net (22) 
Other30  41  
Net cash used in continuing operations(4,581) (12,205) 
Net cash used in discontinued operations(12) (265) 
Net cash used in investing activities(4,593) (12,470) 
CASH FLOWS FROM FINANCING ACTIVITIES
Common dividends paid(993) (877) 
Preferred dividends paid(142) (89) 
Issuances of mandatory convertible preferred stock, net—  2,258  
Issuances of common stock, net1,830  2,272  
Repurchases of common stock(26) (21) 
Issuances of debt (maturities greater than 90 days)4,296  8,927  
Payments on debt (maturities greater than 90 days) and finance leases(3,667) (3,342) 
Increase (decrease) in short-term debt, net656  (84) 
Advances from unconsolidated affiliates155  —  
Proceeds from sale of noncontrolling interests, net 90  
Purchases of noncontrolling interests(30) (7) 
Contributions from (distributions to) noncontrolling interests, net98  (26) 
Intercompany activities with discontinued operations, net(266) (109) 
Other(49) (117) 
Net cash provided by continuing operations1,867  8,875  
Net cash used in discontinued operations(392) (25) 
Net cash provided by financing activities1,475  8,850  
Effect of exchange rate changes in continuing operations—  (2) 
Effect of exchange rate changes in discontinued operations (12) 
Effect of exchange rate changes on cash, cash equivalents and restricted cash (14) 
Decrease in cash, cash equivalents and restricted cash, including discontinued operations(29) (118) 
Cash, cash equivalents and restricted cash, including discontinued operations, January 1246  364  
Cash, cash equivalents and restricted cash, including discontinued operations, December 31$217  $246  
(1) Amounts have been retrospectively adjusted for discontinued operations.




SEMPRA ENERGY  
Table D  
SEGMENT EARNINGS (LOSSES) AND CAPITAL EXPENDITURES, INVESTMENTS AND ACQUISITIONS 
Three months ended
December 31,
Years ended
December 31,
(Dollars in millions) 2019
2018(1)
2019
2018(1)
    (unaudited) 
Earnings (Losses) Attributable to Common Shares 
San Diego Gas & Electric  $185  $148  $767  $669  
Southern California Gas  204  156  641  400  
Sempra Texas Utilities  109  88  528  371  
Sempra Mexico  39  76  253  237  
Sempra Renewables  —  382  59  328  
Sempra LNG  (19) 147  (6) (617) 
Parent and other  (132) (174) (515) (620) 
Discontinued operations  61  41  328  156  
Total  $447  $864  $2,055  $924  
Three months ended
December 31,
Years ended
December 31,
(Dollars in millions) 2019
2018(1)
2019
2018(1)
    (unaudited) 
Capital Expenditures, Investments and Acquisitions  
San Diego Gas & Electric  $451  $348  $1,522  $1,542  
Southern California Gas  420  411  1,439  1,538  
Sempra Texas Utilities  347  179  1,685  9,457  
Sempra Mexico  204  148624  468  
Sempra Renewables  —  10   56  
Sempra LNG  39  104  222  306  
Parent and other   (63) 11  345  
Capital Expenditures, Investments and Acquisitions  $1,466  $1,137  $5,505  $13,712  
(1) Amounts have been retrospectively adjusted for discontinued operations.




SEMPRA ENERGY
Table E
OTHER OPERATING STATISTICS (Unaudited)
Three months ended December 31,Years ended or at December 31,
2019201820192018
UTILITIES
SDG&E and SoCalGas
Gas sales (Bcf)(1)
103  93  374  337  
Transportation (Bcf)(1)
149  134  573  581  
Total deliveries (Bcf)(1)
252  227  947  918  
Total gas customer meters (thousands)6,924  6,885  
SDG&E
Electric sales (millions of kWhs)(1)
3,601  3,643  14,397  15,125  
Direct Access and Community Choice Aggregation (millions of kWhs)909  947  3,549  3,628  
Total deliveries (millions of kWhs)(1)
4,510  4,590  17,946  18,753  
Total electric customer meters (thousands)1,471  1,459  
Oncor(2)
Total deliveries (millions of kWhs)30,916  29,800  133,378  107,276  
Total electric customer meters (thousands)3,685  3,621  
Ecogas
Natural gas sales (Bcf)  —    
Natural gas customer meters (thousands)132  123  
ENERGY-RELATED BUSINESSES
Power generated and sold
Sempra Mexico
Termoeléctrica de Mexicali (TdM) (millions of kWhs)1,011  1,152  3,873  4,074  
Wind and solar (millions of kWhs)(3)
333  252  1,442  1,176  
(1)
Includes intercompany sales.
(2)
Includes 100% of the electric deliveries and customer meters of Oncor Electric Delivery Company LLC (Oncor), in which we hold an 80.25% interest through our March 2018 acquisition of our equity method investment in Oncor Electric Delivery Holdings Company LLC (Oncor Holdings). Total deliveries for the year ended December 31, 2018 only include volumes from the March 9, 2018 acquisition date.
(3)
Includes 50% of the total power generated and sold at the Energía Sierra Juárez wind power generation facility, in which Sempra Energy has a 50% ownership interest. Energía Sierra Juárez is not consolidated within Sempra Energy, and the related investment is accounted for under the equity method.


Document
Exhibit 99.2

         SEMPRA ENERGY
           Table F (Unaudited)
STATEMENT OF OPERATIONS DATA BY SEGMENT
Three months ended December 31, 2019
(Dollars in millions)SDG&ESoCalGasSempra Texas UtilitiesSempra MexicoSempra RenewablesSempra LNGConsolidating Adjustments, Parent & OtherTotal
Revenues$1,259  $1,383  $—  $317  $—  $83  $(99) $2,943  
Cost of sales and other expenses(705) (847) —  (153) —  (112) 51  (1,766) 
Depreciation and amortization(189) (153) —  (47) —  (3) (3) (395) 
Other (expense) income, net(21) (73) —  70  —  —  (2) (26) 
Income (loss) before interest and tax(1)
344  310  —  187  —  (32) (53) 756  
Net interest (expense) income(99) (36) —  (10) —  (1) (111) (257) 
Income tax (expense) benefit(60) (70) —  (111) —   67  (165) 
Equity earnings (losses), net—  —  109  (19) —   —  95  
Earnings attributable to noncontrolling interests—  —  —  (8) —  —  —  (8) 
Preferred dividends—  —  —  —  —  —  (35) (35) 
Earnings (losses) from continuing operations$185  $204  $109  $39  $—  $(19) $(132) 386  
Earnings from discontinued operations61  
Earnings attributable to common shares$447  
Three months ended December 31, 2018(2)
(Dollars in millions)SDG&ESoCalGasSempra Texas UtilitiesSempra MexicoSempra RenewablesSempra LNGConsolidating Adjustments, Parent & OtherTotal
Revenues$1,163  $1,262  $—  $348  $21  $142  $(110) $2,826  
Cost of sales and other expenses(737) (882) —  (175) (26) (122) 100  (1,842) 
Depreciation and amortization(179) (142) —  (44) —  (2) (9) (376) 
Write-off and reduction in impairment losses—  —  —  —  —  183  (1) 182  
Gain (loss) on sale of assets—   —  (1) 513  —  —  513  
Other (expense) income, net(21) (34) —  (63)  —  (17) (134) 
Income (loss) before interest and tax(1)
226  205  —  65  509  201  (37) 1,169  
Net interest (expense) income(59) (32) —  (13)  10  (119) (211) 
Income tax (expense) benefit(22) (17) —