SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 11-K/A
Annual Report Pursuant to Section 15(d) of the
Securities Exchange Act of 1934 (Fee Required)
For the fiscal year ended December 31, 1999
Commission File Number 1-14201
A. Full title of the Plans and the address of the Plans, if different from
that of the issuer named below: Sempra Energy Services Savings Plan
B. Name of issuer of the securities held pursuant to the Plan and the
address of its principal executive office: Sempra Energy, 101 Ash
Street, San Diego, CA 92101-3017
SEMPRA ENERGY SERVICES
SAVINGS PLAN (FORMERLY
CES/WAY RETIREMENT SAVINGS PLAN)
FINANCIAL STATEMENTS AND SUPPLEMENTAL SCHEDULES
FOR THE YEAR ENDED DECEMBER 31, 1999 AND
INDEPENDENT AUDITORS' REPORT
SEMPRA ENERGY SAVINGS PLAN (FORMERLY CES/WAY RETIREMENT SAVINGS PLAN)
TABLE OF CONTENTS
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PAGE
INDEPENDENT AUDITORS' REPORT 1
FINANCIAL STATEMENTS:
Statement of Assets Available for Benefits as of December 31, 1999 2
Statement of Changes in Assets Available for Benefits for the Year Ended
December 31, 1999 3
Notes to Financial Statements 4-7
SUPPLEMENTAL SCHEDULE AT DECEMBER 31, 1999
Schedule of Assets Held for Investment Purposes at End of Year 8
Schedule of Nonexempt Transaction 9
All other schedules required by the Department of Labor's Rules and Regulations
for Reporting and Disclosure under the Employee Retirement Income Security Act
of 1974 are omitted because of the absence of conditions under which they are
required or as they are filed by the trustee of the Master Trust in which the
Plan participates.
INDEPENDENT AUDITORS' REPORT
Sempra Energy Services Savings Plan:
We have audited the accompanying statement of assets available for benefits of
Sempra Energy Services Savings Plan (formerly CES/Way Retirement Savings Plan)
(the "Plan") as of December 31, 1999 and the related statement of changes in
assets available for benefits for the year then ended. These financial
statements are the responsibility of the Plan's management. Our responsibility
is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted
in the United States of America. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, such financial statements present fairly, in all material
respects, the assets available for benefits of the Plan at December 31, 1999,
and the changes in assets available for benefits of the Plan for the year then
ended in conformity with accounting principles generally accepted in the United
States of America.
Our audit was conducted for the purpose of forming an opinion on the basic
financial statements taken as a whole. The supplemental schedules of assets held
for investment purposes at end of year and nonexempt transaction are presented
for the purpose of additional analysis and are not a required part of the basic
financial statements, but are supplementary information required by the
Department of Labor's Rules and Regulations for Reporting and Disclosure under
the Employee Retirement Income Security Act of 1974. These supplemental
schedules are the responsibility of the Plan's management. Such schedules have
been subjected to the auditing procedures applied in our audit of the basic
financial statements and, in our opinion, are fairly stated in all material
respects when considered in relation to the basic financial statements taken as
a whole.
The accompanying statement of assets available for benefits as of December 31,
1998 was compiled by us and our report thereon, dated April 21, 2000, stated we
did not audit or review that financial statement and, accordingly, we express no
opinion or other form of assurance on it. Management has elected to omit
substantially all 1998 disclosures required by accounting principles generally
accepted in the United States of America. If the omitted disclosures were
included in the Plan's financial statements, they might influence the user's
conclusion about the Plan's assets available for benefits as of December 31,
1998. Accordingly, the accompanying statement of assets available for benefits
as of December 31, 1998 is not designed for those who are not informed of such
matters.
/s/ Deloitte & Touche LLP
October 10, 2000
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SEMPRA ENERGY SERVICES SAVINGS PLAN
(FORMERLY CES/WAY RETIREMENT SAVINGS PLAN)
STATEMENT OF ASSETS AVAILABLE FOR BENEFITS
DECEMBER 31, 1999
(DOLLARS IN THOUSANDS)
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1999 1998
(UNAUDITED)
INVESTMENTS:
At fair value:
Investment in master trust $ 1,542
Pooled separate accounts 866 $ 732
Guaranteed interest accounts 120 103
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Total investments 2,528 835
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RECEIVABLES:
Dividends 10 -
Employer contributions 22 117
Participating employee contributions 22 37
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Total receivables 54 154
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ASSETS AVAILABLE FOR BENEFITS $ 2,582 $ 989
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The accompanying notes are an integral part of these financial statements.
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SEMPRA ENERGY SAVINGS PLAN
(FORMERLY CES/WAY RETIREMENT SAVINGS PLAN)
STATEMENT OF CHANGES IN ASSETS AVAILABLE FOR BENEFITS
YEAR ENDED DECEMBER 31, 1999
(DOLLARS IN THOUSANDS)
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ADDITIONS:
Net investment income:
Equity in net investment income of the Master Trust $ 71
Net appreciation in fair value of investments 58
Dividends and interest 20
Less investment expenses (4)
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Net investment income 145
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Contributions:
Employer 207
Participating employees 624
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Total contributions 831
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Transfers from plans of related entities 794
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Total additions 1,770
-------
DEDUCTIONS:
Distributions to participants or their beneficiaries 162
Administrative expenses 15
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Total deductions 177
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NET INCREASE 1,593
ASSETS AVAILABLE FOR PLAN BENEFITS:
Beginning of year 989
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End of year $ 2,582
=======
The accompanying notes are an integral part of these financial statements.
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SEMPRA ENERGY SAVINGS PLAN
(FORMERLY CES/WAY RETIREMENT SAVINGS PLAN)
NOTES TO FINANCIAL STATEMENTS
DECEMBER 31, 1999
(DOLLARS IN THOUSANDS)
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1. PLAN DESCRIPTION AND RELATED INFORMATION
The following description of the Sempra Energy Services Savings Plan
(formerly CES/Way Retirement Savings Plan) (the "Plan") is provided for
general information purposes only. Participants should refer to the Plan
document for a more complete description of the Plan's provisions.
GENERAL - The Plan is a defined contribution plan, adopted on January 1,
1998, and amended and restated on January 1, 1999 to allow for participant
loans and to allow all employees to participate in employee deferrals
immediately. The Plan provides employees of Sempra Energy Services
(formerly CES/Way) or any affiliate who has adopted the Plan (the
"Company" or "Employer") with retirement benefits. Employees may
participate immediately in the Plan and, after one year in which they
complete 1,000 hours of service, receive employer matching contributions.
Employees may make regular savings investments in Sempra Energy common
stock and other optional investments permitted by the Plan. The Plan is
subject to the provisions of the Employee Retirement Income Security Act
of 1974 ("ERISA").
At June 26, 1998, Pacific Enterprises and Enova Corporation, the Parent
Companies of CES/Way, combined into a new company named Sempra Energy. The
Plan was amended and restated on January 1, 1999 and the individual's
existing account balance in the group annuity contract under the prior
plan was frozen and will remain in the Plan until the individual's
retirement, death, disability, or termination of service. Effective
January 1, 1999, the Plan began participating in the Sempra Energy Savings
Master Trust (the "Master Trust").
ADMINISTRATION - Certain administrative functions are performed by
officers or employees of the Company. No such officer or employee receives
compensation from the Plan. Certain administrative expenses are paid
directly by the Company, such as legal and accounting fees. All investment
expenses are paid by the Plan, including recordkeeping, trustee fees and
investment management fees.
CONTRIBUTIONS - Contributions to the Plan can be made under the following
provisions:
PARTICIPATING EMPLOYEE CONTRIBUTIONS - Pursuant to Section 401(a)
of the Internal Revenue Code (the "IRC"), each participant may
contribute up to 15% of eligible pay on a pre-tax basis, an
after-tax basis, or a combination. Total individual pre-tax
contributions in calendar year 1999 were limited by law to
$10,000.
EMPLOYER NONELECTIVE MATCHING CONTRIBUTIONS - The Company makes
matching contributions to the Plan equal to 50% of each
participant's contribution, up to the first 6%. The Company's
contributions are invested in Sempra Energy common stock.
DISCRETIONARY INCENTIVE CONTRIBUTION - If established performance
goals and targets of Sempra Energy are met in accordance with the
terms of the incentive match guidelines established each year, the
Company will make an additional contribution as determined by the
Board of Directors of Sempra Energy. For 1999, an incentive
contribution of 3/4 of 1% of eligible compensation was made on
March 15, 2000 to all employees employed on December 31, 1999. The
contribution was invested in Sempra Energy Common Stock.
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PARTICIPANT ACCOUNTS - Separate accounts are maintained for each
participant. Each participant's account is credited with the participant's
contributions, Employer contributions, and an allocation of investment
earnings of the Plan and is reduced by an allocation of fees. Allocations
are based on participants' contributions or account balances, as defined
in the Plan document.
VESTING - All participant accounts are fully vested and nonforfeitable at
all times.
INVESTMENT OPTIONS - Prior to January 1, 1999, participants' accounts were
maintained by The Principal Group. Effective January 1, 1999, the Plan was
amended and restated. The participants' account balances in the Plan at
December 31, 1998 were frozen and can be directed into guaranteed interest
accounts or mutual funds in pooled separate accounts offered by a group
annuity contract held at the Principal Group.
Effective January 1, 1999, all contributions are invested in a Master
Trust (see Note 5). Employees elect to have their contributions invested
in increments of 10% in Sempra Energy common stock or mutual funds offered
by T. Rowe Price Trust Company ("T. Rowe Price"), trustee of the Plan.
PAYMENT OF BENEFITS - Provisions of the Plan include certain restrictions
on the form and timing of distributions to withdrawing participants. In
general, benefits are payable upon retirement, death, disability or
termination of service.
GRANDFATHERED PROVISION - Distributions of an account of a married
participant from the group annuity contract in a form other than a 50%
joint and survivor annuity shall require an executed waiver in the form
provided by the Plan at December 31, 1998.
PLAN TERMINATION - Although it has not expressed any intent to do so, the
Company has the right under the Plan to discontinue its contributions at
any time and to terminate the Plan subject to the provisions of ERISA.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING - The Plan maintains its financial statements on the
accrual basis of accounting.
USE OF ESTIMATES - The preparation of financial statements in conformity
with generally accepted accounting principles requires management to make
estimates and assumptions that affect the reported amounts of net assets
and disclosures at the date of the financial statements and the reported
changes in net assets during the reporting period. Actual results could
differ from those estimates.
INVESTMENT VALUATION AND INCOME RECOGNITION - The Plan's investment in the
Master Trust and Principal Group pooled separate accounts are stated at
fair value based on quoted market prices of the underlying investments.
The Plan's investment in the Principal Group guaranteed interest accounts
are stated at fair value based on the difference between the current
average interest rates for Treasury bonds, bills, and notes and the
interests rate on the accounts as well as the remaining time until
maturity.
Purchases and sales of securities are recorded on trade date. Interest
income is recorded on the accrual basis. Dividends are recorded on the
ex-dividend date.
BENEFIT PAYMENTS - Payments are recorded when paid.
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3. TAX STATUS
The Company has not yet requested from the Internal Revenue Service a
determination letter stating that the Plan, as designed, is in compliance
with the applicable requirements of the Internal Revenue Code ("IRC"). The
Plan's administrator and tax counsel believe that the Plan is designed and
operated in accordance with the applicable sections of the IRC, and that
the underlying trust is exempt from taxation under Section 501(a) of the
IRC.
4. PARTICIPANT LOANS
The Plan was amended effective January 1, 1999 to permit participants to
borrow against the balances in their individual accounts within the Master
Trust. A participant is limited to borrowing a maximum of 50% of the
present value of his/her account balance within the Master Trust or
$50,000, whichever is less. The minimum amount that can be borrowed is
$1,000, and the fee charged to process a loan is paid by the participant
who takes out the loan. Loans have a maximum repayment period of five
years. The loans bear interest at 1% above the prime rate, as published in
the Wall Street Journal, at the time the loan is made.
5. INVESTMENTS
Principal Group investments that represent 5% or more of the Plan's net
assets at December 31, 1999 are identified below:
Investment in master trust $ 1,542
Pooled Separate Accounts:
Large Cap Stock Index Account 150
Medium Company Blend Account 127
The net appreciation (depreciation) in the fair value of the Principal
Group investments, dividends, and interest are summarized as follows for
the year ended December 31, 1999:
Net appreciation (depreciation) in fair value of investments:
Pooled Separate Accounts $ 60
Guaranteed interest accounts (2)
Dividends 8
Interest 12
6. INVESTMENT IN THE MASTER TRUST
Except for the frozen account balances maintained in a group annuity
contract at the Principal Group (see Note 1), the Plan's assets are held
in a trust account at T. Rowe Price, and consist of an interest in the
Master Trust. Use of the Master Trust permits the commingling of the trust
assets of two or more similar employee benefit plans sponsored by Sempra
Energy for investment and administrative purposes. The Plan has an
approximate .5% interest in the net assets available for plan benefits of
the Master Trust at December 31, 1999.
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Net earnings of the Master Trust are allocated daily by T. Rowe Price to
each participant's account balance. Net earnings include interest income,
dividend income and net appreciation (depreciation) of investments.
Benefit payments, contributions and expenses are recorded on a
specific-identification basis.
The net assets available for plan benefits of the Master Trust at December
31, 1999 are summarized as follows:
Sempra Energy common stock $397,997
Mutual funds 444,210
Participant loans 15,835
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Net assets available for plan benefits $858,042
========
Net appreciation, dividends, and interest for the Master Trust for the
year ended December 31, 1999 is summarized as follows:
Net appreciation (depreciation) of investments:
Sempra Energy common stock $ (120,700)
Mutual funds 47,813
Dividends 38,051
Interest 1,340
7. NONPARTICIPANT-DIRECTED INVESTMENTS
The Company's contributions to the Plan are invested solely in Sempra
Energy common stock. These contributions are classified as
nonparticipant-directed investments. Information about the net assets and
the significant components of the changes in net assets relating to the
nonparticipant-directed investments for the year ended December 31, 1999
is as follows:
NET ASSETS:
Sempra Energy common stock (included in Master Trust) $ 299
======
CHANGES IN NET ASSETS:
Contributions $ 207
Dividends 15
Net depreciation (54)
Benefits paid to participants (18)
Transfers from plans of related entities 149
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$ 299
======
8. NONEXEMPT TRANSACTION WITH PARTY-IN-INTEREST
The Company did not remit March, May and September 1999 contributions
withheld from participants' pay within the time period required by ERISA.
Such late remittance is considered a prohibited transaction and was
reported on the Supplemental Schedule of Nonexempt Transactions
accompanying the Form 5500 for the year ended December 31, 1999. The
March, May and September 1999 participant and employer matching
contributions of $97,921, $30,408 and $33,866, respectively, were remitted
to the plan in the months following the months of contributions withheld.
An additional $1,269, representing lost earnings due to late remittance,
will be paid to the Plan by the Company and allocated to the affected
participant's accounts.
* * * * * *
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SEMPRA ENERGY SERVICES SAVINGS PLAN
(FORMERLY CES/WAY RETIREMENT SAVINGS PLAN)
SCHEDULE OF ASSETS HELD FOR INVESTMENT PURPOSES AT END OF YEAR
YEAR ENDED DECEMBER 31, 1999
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FAIR
DESCRIPTION VALUE
GUARANTEED INTEREST ACCOUNTS
3-year, matures December 31, 1999, 5.67% to 5.68% $ 24
5-year, matures December 31, 1999, 5.37% 1
3-year, matures December 31, 2000, 4.99% to 5.30% 29
5-year, matures December 31, 2000, 6.09% to 6.60% 6
3-year, matures December 31, 2001, 4.74% to 5.07% 50
5-year, matures December 31, 2001, 5.80% to 5.82% 3
5-year, matures December 31, 2002, 5.07% 3
5-year, matures December 31, 2003, 5.15% to 5.49% 4
-----
Total Guaranteed interest accounts $ 120
=====
POOLED SEPARATE ACCOUNTS
Money Market Account $ 34
Bond & Mortgage Account 30
Government Securities Account 41
Bond Emphasis Balanced Account 36
Stock Emphasis Balanced Account 74
Large Cap Stock Index Account 150
Medium Company Blend 127
Medium Company Value Account 90
Real Estate Account 4
U.S. Stock Account 115
International Stock Account 63
Small Company Blend Account 102
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Total pooled separate accounts $ 866
=====
Note: Assets held for investment purposes in the Sempra Energy Master Trust
are listed in the 1999 Form 5500 filed by the Master Trust.
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SCHEDULE OF NONEXEMPT TRANSACTION
YEAR ENDED DECEMBER 31, 1999
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(a) (b) (c) (d) (i) (j)
IDENTITY OF DESCRIPTION OF TRANSACTION PURCHASE CURRENT NET GAIN
PARTY INVOLVED RELATIONSHIP PRICE VALUE (LOSS)
Sempra Energy Plan Sponsor Late remittance of March, 162,195 163,463 (1,269)
Services May and September 1999
withheld participant
contributions and employer
matching contributions of
$97,921, $30,408, and
$33,866, respectively.
Remittance of lost earnings
of $1,269 made in October
2000.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Plans'
sponsors have duly caused this annual report to be signed on their behalf by the
undersigned thereunto duly authorized.
Sempra Energy Services Savings Plan
Date: November 8, 2000 /s/ G. Joyce Rowland, Senior Vice President
-------------------------------------------
G. Joyce Rowland, Senior Vice President
Exhibit 23.1
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement Numbers
333-51309 and 333-77843 on Form S-3 and Registration Statement Number 333-56161
on Form S-8 of Sempra Energy of our report, relating to Sempra Energy Services
Savings Plan dated October 10, 2000, appearing in the Annual Report on Form
11-K/A of Sempra Energy for the year ended December 31, 1999.
/s/ Deloitte & Touche LLP
San Diego, California
November 8, 2000
