SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act
of 1934
|
Date of Report |
|
|
(Date of earliest event reported): |
November 2, 2005 |
SAN DIEGO GAS & ELECTRIC COMPANY
- ---------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
|
CALIFORNIA |
1-3779 |
95-1184800 |
|
(State of incorporation |
(Commission |
(I.R.S. Employer |
|
8330 CENTURY PARK COURT, SAN DIEGO, CA |
92123 |
|
(Address of principal executive offices) |
(Zip Code) |
|
Registrant's telephone number, including area code |
(619) 696-2000 |
---------------------------------------------------------------------
(Former name or former address, if changed since last report.)
FORM 8-K
Item 2.02 Results of Operations and Financial Condition
The information furnished in this Item 2.02 and in Exhibits 99.1 and 99.2 shall not be deemed to be "filed" for purposes of the Securities Exchange Act of 1934, nor shall it be deemed to be incorporated by reference in any filing of San Diego Gas & Electric Company, whether made before or after the date hereof, regardless of any general incorporation language in such filing.
On November 2, 2005, Sempra Energy, of which San Diego Gas & Electric Company is a consolidated subsidiary, issued a press release announcing consolidated net income of $221 million, or $0.86 per diluted share of common stock, for the third quarter of 2005. The press release has been posted on Sempra Energy's website (www.sempra.com) and a copy is attached as Exhibit 99.1.
Concurrently with the website posting of such press release and as noted therein, Sempra Energy also posted its Income Statement Data by Business Unit for the three months and the nine months ended September 30, 2005 and 2004. A copy of such information is attached as Exhibit 99.2
The Sempra Energy financial information contained in the press release includes, on a consolidated basis, information regarding San Diego Gas & Electric Company's results of operations and financial condition.
In addition to reporting net income for the three-month and nine-month periods ended September 30, 2005 and 2004, the press release states what San Diego Gas & Electric Company's net income would have been for the three-month periods excluding the impact of specified unusual factors. Management believes that this presentation assists the reader and the company in understanding trends in earnings.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits
99.1 November 2, 2005 Sempra Energy News Release (including tables)
99.2 Sempra Energy's Income Statement Data by Business Unit for the three months and the nine months ended September 30, 2005 and 2004.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
San Diego Gas & Electric Company
|
Date: November 2, 2005 |
By: /s/ S.D. Davis |
|
S.D. Davis |
|
EXHIBIT 99.1
NEWS RELEASE
|
Media Contacts: |
Doug Kline/Jennifer Andrews |
|
Financial Contacts: |
Dennis Arriola/Karen Sedgwick |
SEMPRA ENERGY REPORTS STRONG OPERATING RESULTS IN THIRD-QUARTER
- Capital Spending for Energy Projects $1 Billion Through Three Quarters
SAN DIEGO, Nov. 2, 2005 - Sempra Energy (NYSE: SRE) today reported third-quarter 2005 earnings of $221 million, or $0.86 per diluted share, compared with third-quarter 2004 earnings of $231 million, or $0.98 per diluted share.
Net income in the third quarter 2005 included the effects of several items, including $71 million from the favorable resolution of prior-years' tax issues, a $38 million gain from the sale of Sempra Commodities' natural gas storage assets, and a $27 million benefit at San Diego Gas & Electric (SDG&E) from an electric-transmission-cost settlement. The quarterly results were negatively affected by a $189 million after-tax effect from an increase in reserves at the parent company and several of its subsidiaries, almost entirely for continuing litigation.
Excluding the impact of discontinued operations and the items listed above, net income would have been $275 million, or $1.07 per diluted share. In the prior-year's period, net income was $227 million, or $0.96 per diluted share, excluding the effects of a $9 million gain from the sale of property and $5 million in tax issues that negatively affected earnings.
For the first nine months of 2005, Sempra Energy's earnings were $565 million, or $2.26 per diluted share, up 3 percent over $549 million, or $2.36 per diluted share, for the same period in 2004.
"Our strong operating results in the third quarter, especially from our commodity operations, have contributed to an improved outlook for the rest of the year," said Stephen L. Baum, chairman and chief executive officer of Sempra Energy. "We are raising our 2005 GAAP earnings-per-share guidance to $3.40 to $3.60 from $3.20 to $3.40."
Sempra Energy's revenues in the third quarter 2005 were $2.7 billion, compared with $2.2 billion in the year-ago quarter, based on higher volatility in commodity prices that led to increased margins in natural gas and power sales at Sempra Commodities.
During the first nine months of 2005, Sempra Energy's capital expenditures totaled $1 billion -- more than half of which have been invested in SDG&E and Southern California Gas Co. (SoCalGas) -- compared with approximately $850 million during the same period last year.
"With energy supplies tight in North America, we continue to invest in natural gas and electric infrastructure to bring new supplies to market," said Baum.
OPERATING HIGHLIGHTS
Sempra Utilities
Third-quarter earnings for SDG&E rose to $102 million in 2005 from $60 million in 2004, due primarily to a $39 million tax benefit and the $27 million electric-transmission-cost settlement, offset by the effect of a $27 million after-tax increase in litigation reserves.
Net income for SoCalGas in the third quarter 2005 was $36 million, compared with $68 million in the third quarter 2004, due primarily to the effect of a $53 million after-tax increase in litigation reserves, partially offset by an $18 million tax benefit. Third-quarter 2004 results included a $9 million gain from a property sale.
SDG&E recently signed several major power-purchase contracts for renewable energy. Last month, the utility entered into an agreement with enXco of Escondido, Calif., for 205.5 megawatts (MW) of wind power with deliveries beginning in 2007-08. In September 2005, SDG&E contracted with Stirling Energy Systems of Arizona for 300 MW of solar power under a 20-year agreement and with San Diego-based Covanta for approximately 4 MW of power from a local landfill gas facility under a 10-year agreement.
"With these new contracts, SDG&E is well on its way to achieving its goal of meeting 20 percent of its customers' needs by 2010 with renewable energy and developing a balanced portfolio of energy resources," said Baum.
Sempra Commodities
Sempra Commodities posted strong quarterly results, earning $161 million in the third quarter 2005, up from $46 million in the same period last year. The bulk of the company's growth during the quarter came from its North American and European natural gas and power sales. The results for the quarter also included a $16 million tax benefit, the $38 million gain related to the sale of its natural gas storage assets and the effect of a $14 million after-tax increase in litigation reserves.
Sempra Generation
Sempra Generation's third-quarter net income was $30 million in 2005, compared with $64 million in 2004. Third-quarter 2005 earnings were affected by higher development costs, $19 million from temporary mark-to-market losses on forward sales and the effect of a $5 million after-tax increase in litigation reserves. Third-quarter 2004 results included approximately $7 million in temporary mark-to-market gains.
Sempra Pipelines & Storage
Based on improved performance at the company's distribution operations outside the United States, Sempra Pipelines & Storage's net income more than doubled to $19 million in the third quarter 2005 from $7 million in the same period last year.
During the quarter, Sempra Pipelines & Storage entered into a Memorandum of Understanding with Kinder Morgan Energy Partners, L.P. to pursue development of a proposed new 1,700-mile natural gas pipeline that would link producing areas in the Rocky Mountain region to the upper Midwest and eastern United States. As designed, the pipeline would have capacity of up to 2 billion cubic feet per day. Initially, Kinder Morgan would own two-thirds of the equity in the proposed pipeline and Sempra Pipelines & Storage would own one-third.
Sempra LNG
Sempra LNG reported a third-quarter loss of $5 million in 2005, compared with a loss of $4 million last year.
"With construction of our Louisiana and Mexico liquefied natural gas (LNG) terminals now under way and our Texas LNG terminal in the latter stages of permitting, we continue to make good progress toward becoming North America's leading importer of LNG," said Baum. "LNG remains a key to expanding domestic supplies and helping to stabilize natural gas prices in the future."
Last month, Sempra LNG announced that it is proceeding with detailed negotiations to deliver Algerian natural gas to the U.S. Gulf Coast. The negotiations follow a Heads of Agreement (HOA) signed earlier this year with Sonatrach S.A., one of the world's leading energy firms. The non-binding HOA contemplates a 20-year agreement to import the equivalent of 250 million cubic feet per day (MMcfd) to 500 MMcfd of Algerian liquefied natural gas to Sempra LNG's Cameron LNG receipt terminal.
Litigation Update
On Oct. 29, 2005, Sempra Energy, SoCalGas and SDG&E announced that the companies had entered into a legal settlement with the County of Los Angeles and 11 other plaintiffs that fully resolved their claims related to the Continental Forge case. Terms of the agreement were not disclosed.
"This settlement represents a very small part of the overall litigation related to the energy crisis," said Baum. "We are pleased with the mutually agreeable settlement."
Internet Broadcast
Sempra Energy will broadcast a live discussion of its earnings results over the Internet today at 1 p.m. EST with key company executives. Access is available by logging onto the Web site at www.sempra.com. For those unable to log onto the live Webcast, the teleconference will be available on replay a few hours after its conclusion by dialing (706) 645-9291 and entering the passcode, 9806013.
Sempra Energy (NYSE: SRE), based in San Diego, is a Fortune 500 energy services holding company with 2004 revenues of $9.4 billion. The Sempra Energy companies' 13,000 employees serve more than 29 million consumers in the United States, Europe, Canada, Mexico, South America and Asia.
Income-statement information by business unit is available on Sempra Energy's Web site at http://www.sempra.com/downloads/3Q2005_Table_F.pdf.
###
This press release contains statements that are not historical fact and constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. When the company uses words like "believes," "expects," "anticipates," "intends," "plans," "estimates," "may," "would," "should" or similar expressions, or when the company discusses its strategy or plans, the company is making forward-looking statements. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions. Future results may differ materially from those expressed in the forward-looking statements. Forward-looking statements are necessarily based upon various assumptions involving judgments with respect to the future and other risks, including, among others: local, regional, national and international economic, competitive, 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 and other regulatory bodies in the United States and other countries; capital markets conditions, inflation rates, interest rates and exchange rates; energy and trading markets, including the timing and extent of changes in commodity prices; the availability of natural gas; weather conditions and conservation efforts; war and terrorist attacks; business, regulatory, environmental, and
legal decisions and requirements; the status of deregulation of retail natural gas and electricity delivery; the timing and success of business development efforts; the resolution of litigation; and other uncertainties, all of which are difficult to predict and many of which are beyond the control of the company. These risks and uncertainties are further discussed in the company's reports filed with the Securities and Exchange Commission that are available through the EDGAR system without charge at its Web site,
www.sec.gov and on the company's Web site, www.sempra.com.Sempra LNG and Sempra Pipelines & Storage are not the same companies as the utilities, SDG&E or SoCalGas, and are not regulated by the California Public Utilities Commission. Sempra Energy Trading, doing business as Sempra Commodities, and Sempra Generation are not the same companies as the utilities, SDG&E or SoCalGas, and the California Public Utilities Commission does not regulate the terms of their products and services.
|
Table A |
|||||||||
|
STATEMENTS OF CONSOLIDATED INCOME (Unaudited) |
|||||||||
|
Three months ended |
Nine months ended |
||||||||
|
September 30, |
September 30, |
||||||||
|
(Dollars in millions, except per share amounts) |
2005 |
|
2004 |
2005 |
|
2004 |
|||
|
Operating revenues |
|||||||||
|
California utilities: |
|||||||||
|
Natural gas |
$ 1,032 |
$ 909 |
$ 3,520 |
$ 3,189 |
|||||
|
Electric |
463 |
445 |
1,263 |
1,246 |
|||||
|
Other |
1,231 |
811 |
2,907 |
2,086 |
|||||
|
Total operating revenues |
2,726 |
2,165 |
7,690 |
6,521 |
|||||
|
Operating expenses |
|||||||||
|
California utilities: |
|||||||||
|
Cost of natural gas |
547 |
438 |
2,060 |
1,744 |
|||||
|
Cost of electric fuel and purchased power |
146 |
143 |
437 |
425 |
|||||
|
Other cost of sales |
743 |
484 |
1,887 |
1,186 |
|||||
|
Other operating expenses |
993 |
530 |
2,069 |
1,597 |
|||||
|
Depreciation and amortization |
157 |
171 |
481 |
501 |
|||||
|
Franchise fees and other taxes |
61 |
54 |
185 |
171 |
|||||
|
Total operating expenses |
2,647 |
1,820 |
7,119 |
5,624 |
|||||
|
Operating income |
79 |
345 |
571 |
897 |
|||||
|
Other income, net |
131 |
40 |
157 |
58 |
|||||
|
Interest income |
29 |
25 |
52 |
58 |
|||||
|
Interest expense |
(75 |
) |
(74 |
) |
(221 |
) |
(234 |
) |
|
|
Preferred dividends of subsidiaries |
(2 |
) |
(2 |
) |
(7 |
) |
(7 |
) |
|
|
Income from continuing operations before income taxes |
162 |
334 |
552 |
772 |
|||||
|
Income tax expense (benefit) |
(60 |
) |
103 |
(16 |
) |
191 |
|||
|
Income from continuing operations |
222 |
231 |
568 |
581 |
|||||
|
Discontinued operations, net of tax |
(1 |
) |
- |
(3 |
) |
(32 |
) |
||
|
Net income |
$ 221 |
$ 231 |
$ 565 |
$ 549 |
|||||
|
Basic earnings per share: |
|||||||||
|
Income from continuing operations |
$ 0.87 |
$ 1.01 |
$ 2.33 |
$ 2.55 |
|||||
|
Discontinued operations, net of tax |
- |
- |
(0.01 |
) |
(0.14 |
) |
|||
|
Net income |
$ 0.87 |
$ 1.01 |
$ 2.32 |
$ 2.41 |
|||||
|
Weighted-average number of shares outstanding (thousands) |
252,974 |
229,376 |
243,342 |
227,412 |
|||||
|
Diluted earnings per share: |
|||||||||
|
Income from continuing operations |
$ 0.86 |
$ 0.98 |
$ 2.27 |
$ 2.50 |
|||||
|
Discontinued operations, net of tax |
- |
- |
(0.01) |
(0.14) |
|||||
|
Net income |
$ 0.86 |
$ 0.98 |
$ 2.26 |
$ 2.36 |
|||||
|
Weighted-average number of shares outstanding (thousands) |
257,370 |
235,936 |
249,874 |
232,366 |
|||||
|
Dividends declared per share of common stock |
$ 0.29 |
$ 0.25 |
$ 0.87 |
$ 0.75 |
|||||
|
SEMPRA ENERGY |
|||||
|
Table B |
|||||
|
CONSOLIDATED BALANCE SHEETS |
|||||
|
September 30, |
December 31, |
||||
|
(Dollars in millions) |
|
2005 |
|
2004 |
|
|
(Unaudited) |
|||||
|
Assets |
|||||
|
Current assets: |
|||||
|
Cash and cash equivalents |
$ 503 |
$ 419 |
|||
|
Short-term investments |
12 |
15 |
|||
|
Accounts receivable |
800 |
1,032 |
|||
|
Due from unconsolidated affiliate |
4 |
4 |
|||
|
Deferred income taxes |
36 |
15 |
|||
|
Interest receivable |
32 |
80 |
|||
|
Trading-related receivables and deposits, net |
3,281 |
2,606 |
|||
|
Derivative trading instruments |
5,547 |
2,339 |
|||
|
Commodities owned |
2,456 |
1,547 |
|||
|
Regulatory assets arising from fixed-price contracts and other derivatives |
121 |
152 |
|||
|
Other regulatory assets |
107 |
103 |
|||
|
Inventories |
240 |
172 |
|||
|
Other |
274 |
222 |
|||
|
Current assets of continuing operations |
13,413 |
8,706 |
|||
|
Current assets of discontinued operations |
55 |
70 |
|||
|
Total current assets |
13,468 |
8,776 |
|||
|
Investments and other assets: |
|||||
|
Due from unconsolidated affiliates |
27 |
42 |
|||
|
Regulatory assets arising from fixed-price contracts and other derivatives |
411 |
500 |
|||
|
Other regulatory assets |
564 |
619 |
|||
|
Nuclear decommissioning trusts |
631 |
612 |
|||
|
Investments |
1,104 |
1,164 |
|||
|
Sundry |
994 |
844 |
|||
|
Total investments and other assets |
3,731 |
3,781 |
|||
|
Property, plant and equipment, net |
11,780 |
11,086 |
|||
|
Total assets |
$ 28,979 |
$ 23,643 |
|||
|
Liabilities and Shareholders' Equity |
|||||
|
Current liabilities: |
|||||
|
Short-term debt |
$ 305 |
$ 405 |
|||
|
Accounts payable |
1,088 |
1,126 |
|||
|
Due to unconsolidated affiliates (mandatorily redeemable preferred securities) |
- |
205 |
|||
|
Income taxes payable |
75 |
187 |
|||
|
Trading-related payables |
4,501 |
3,182 |
|||
|
Derivative trading instruments |
4,742 |
1,484 |
|||
|
Commodities sold with agreement to repurchase |
394 |
513 |
|||
|
Dividends and interest payable |
137 |
123 |
|||
|
Regulatory balancing accounts, net |
522 |
509 |
|||
|
Fixed-price contracts and other derivatives |
128 |
157 |
|||
|
Current portion of long-term debt |
401 |
398 |
|||
|
Other |
820 |
776 |
|||
|
Current liabilities of continuing operations |
13,113 |
9,065 |
|||
|
Current liabilities of discontinued operations |
7 |
17 |
|||
|
Total current liabilities |
13,120 |
9,082 |
|||
|
Long-term debt |
4,346 |
4,192 |
|||
|
Deferred credits and other liabilities: |
|||||
|
Due to unconsolidated affiliates |
162 |
162 |
|||
|
Customer advances for construction |
95 |
97 |
|||
|
Postretirement benefits other than pensions |
124 |
129 |
|||
|
Deferred income taxes |
227 |
420 |
|||
|
Deferred investment tax credits |
74 |
78 |
|||
|
Regulatory liabilities arising from cost of removal obligations |
2,444 |
2,359 |
|||
|
Regulatory obligations arising from asset retirement obligations |
342 |
333 |
|||
|
Other regulatory liabilities |
60 |
67 |
|||
|
Fixed-price contracts and other derivatives |
412 |
500 |
|||
|
Asset retirement obligations |
334 |
326 |
|||
|
Deferred credits and other |
1,183 |
854 |
|||
|
Total deferred credits and other liabilities |
5,457 |
5,325 |
|||
|
Preferred stock of subsidiaries |
179 |
179 |
|||
|
Shareholders' equity |
5,877 |
4,865 |
|||
|
Total liabilities and shareholders' equity |
$ 28,979 |
$ 23,643 |
|||
|
SEMPRA ENERGY |
||||||
|
Table C |
||||||
|
CONDENSED STATEMENTS OF CONSOLIDATED CASH FLOWS (Unaudited) |
||||||
|
Nine months ended |
||||||
|
September 30, |
||||||
|
(Dollars in millions) |
|
2005 |
|
2004 |
||
|
Cash Flows from Operating Activities: |
||||||
|
Net income |
$ 565 |
$ 549 |
||||
|
Adjustments to reconcile net income to net cash provided by operating |
||||||
|
activities: |
||||||
|
Loss from discontinued operations, net of tax |
3 |
32 |
||||
|
Depreciation and amortization |
481 |
501 |
||||
|
Gain on sale of assets |
(105 |
) |
(15 |
) |
||
|
Impairment losses |
11 |
8 |
||||
|
Deferred income taxes and investment tax credits |
(161 |
) |
(7 |
) |
||
|
Other |
7 |
42 |
||||
|
Net changes in other working capital components |
(387 |
) |
(519 |
) |
||
|
Changes in other assets |
(99 |
) |
(72 |
) |
||
|
Changes in other liabilities |
349 |
21 |
||||
|
Net cash provided by continuing operations |
664 |
540 |
||||
|
Net cash used in discontinued operations |
(3 |
) |
(30 |
) |
||
|
Net cash provided by operating activities |
661 |
510 |
||||
|
Cash Flows from Investing Activities: |
||||||
|
Expenditures for property, plant and equipment |
(957 |
) |
(782 |
) |
||
|
Proceeds from sale of assets |
274 |
371 |
(1) |
|||
|
Proceeds from disposal of discontinued operations |
3 |
137 |
||||
|
Investments and acquisitions of subsidiaries, net of cash acquired |
(80 |
) |
(70 |
) |
||
|
Dividends received from affiliates |
46 |
50 |
||||
|
Other |
(8 |
) |
8 |
|||
|
Net cash used in investing activities |
(722 |
) |
(286 |
) |
||
|
Cash Flows from Financing Activities: |
||||||
|
Common dividends paid |
(193 |
) |
(145 |
) |
||
|
Issuance of common stock |
692 |
90 |
||||
|
Repurchases of common stock |
(95 |
) |
(5 |
) |
||
|
Issuance of long-term debt |
255 |
897 |
||||
|
Payments on long-term debt |
(209 |
) |
(1,648 |
) |
||
|
Redemption of mandatorily redeemable preferred securities |
(200 |
) |
- |
|||
|
Increase (decrease) in short-term debt, net |
(102 |
) |
434 |
|||
|
Other |
(3 |
) |
(4 |
) |
||
|
Net cash provided by (used in ) financing activities |
145 |
(381 |
) |
|||
|
Increase (decrease) in cash and cash equivalents |
84 |
(157 |
) |
|||
|
Cash and cash equivalents, January 1 |
419 |
409 |
||||
|
Cash and cash equivalents, September 30 |
$ 503 |
$ 252 |
||||
|
(1) |
Includes $363 proceeds from the sale of U.S. Treasury obligations which previously securitized the Mesquite synthetic lease. |
|||||
|
Table D |
||||||||||
|
BUSINESS UNIT EARNINGS AND CAPITAL EXPENDITURES & INVESTMENTS (Unaudited) |
||||||||||
|
Three months ended |
Nine months ended |
|||||||||
|
September 30, |
September 30, |
|||||||||
|
(Dollars in millions) |
2005 |
|
2004 |
2005 |
|
2004 |
||||
|
Net Income |
||||||||||
|
California Utilities: |
||||||||||
|
San Diego Gas & Electric |
$ 102 |
$ 60 |
$ 190 |
$ 140 |
||||||
|
Southern California Gas |
36 |
68 |
163 |
174 |
||||||
|
Total California Utilities |
138 |
128 |
353 |
314 |
||||||
|
Sempra Global: |
||||||||||
|
Sempra Commodities |
161 |
46 |
216 |
149 |
||||||
|
Sempra Generation |
30 |
64 |
103 |
118 |
||||||
|
Sempra Pipelines & Storage |
19 |
7 |
48 |
35 |
||||||
|
Sempra LNG |
(5 |
) |
(4 |
) |
(15 |
) |
- |
|||
|
Total Sempra Global |
205 |
113 |
352 |
302 |
||||||
|
Sempra Financial |
8 |
10 |
19 |
26 |
||||||
|
Parent & Other |
(129 |
) |
(20 |
) |
(156 |
) |
(61 |
) |
||
|
Continuing Operations |
222 |
231 |
568 |
581 |
||||||
|
Discontinued Operations (1) |
(1 |
) |
- |
(3 |
) |
(32 |
) |
|||
|
Consolidated Net Income |
$ 221 |
$ 231 |
$ 565 |
$ 549 |
||||||
|
(1) |
Reflects Atlantic Electric & Gas. |
|||||||||
|
Three months ended |
Nine months ended |
|||||||||
|
September 30, |
September 30, |
|||||||||
|
(Dollars in millions) |
2005 |
|
2004 |
|
2005 |
|
2004 |
|||
|
Capital Expenditures and Investments |
||||||||||
|
California Utilities: |
||||||||||
|
San Diego Gas & Electric |
$ 146 |
$ 102 |
$ 342 |
$ 283 |
||||||
|
Southern California Gas |
99 |
90 |
245 |
234 |
||||||
|
Total California Utilities |
245 |
192 |
587 |
517 |
||||||
|
Sempra Global: |
||||||||||
|
Sempra Generation |
115 |
106 |
209 |
154 |
||||||
|
Sempra Commodities |
32 |
21 |
61 |
103 |
||||||
|
Sempra Pipelines & Storage |
4 |
2 |
11 |
18 |
||||||
|
Sempra LNG |
43 |
13 |
156 |
35 |
||||||
|
Total Sempra Global |
194 |
142 |
437 |
310 |
||||||
|
Parent & Other |
7 |
7 |
13 |
25 |
||||||
|
Consolidated Capital Expenditures and Investments |
$ 446 |
$ 341 |
$ 1,037 |
$ 852 |
||||||
|
SEMPRA ENERGY |
||||||||||
|
Table E |
||||||||||
|
OTHER OPERATING STATISTICS (Unaudited) |
||||||||||
|
Three months ended |
Nine months ended |
|||||||||
|
September 30, |
|
September 30, |
||||||||
|
CALIFORNIA UTILITIES |
2005 |
|
2004 |
|
2005 |
|
2004 |
|||
|
Revenues (Dollars in millions) |
||||||||||
|
SDG&E (excludes intercompany sales) |
$ 596 |
$ 545 |
$ 1,747 |
$ 1,649 |
||||||
|
SoCalGas (excludes intercompany sales) |
$ 899 |
$ 809 |
$ 3,036 |
$ 2,786 |
||||||
|
Gas Sales (Bcf) |
67 |
67 |
290 |
288 |
||||||
|
Transportation and Exchange (Bcf) |
142 |
162 |
381 |
411 |
||||||
|
Total Deliveries (Bcf) |
209 |
229 |
671 |
699 |
||||||
|
Total Gas Customers (Thousands) |
6,358 |
6,271 |
||||||||
|
Electric Sales (Millions of kWhs) |
4,300 |
4,247 |
11,988 |
11,806 |
||||||
|
Direct Access (Millions of kWhs) |
865 |
902 |
2,493 |
2,560 |
||||||
|
Total Deliveries (Millions of kWhs) |
5,165 |
5,149 |
14,481 |
14,366 |
||||||
|
Total Electric Customers (Thousands) |
1,333 |
1,312 |
||||||||
|
SEMPRA GENERATION |
|
|
|
|
|
|
||||
|
Power Sold (Millions of kWhs) |
6,317 |
6,435 |
16,967 |
14,796 |
||||||
|
SEMPRA PIPELINES & STORAGE |
||||||||||
|
(Represents 100% of these subsidiaries, although only the Mexican subsidiaries are 100% owned by Sempra Energy.) |
||||||||||
|
Natural Gas Sales (Bcf) |
||||||||||
|
Argentina |
88 |
78 |
210 |
191 |
||||||
|
Mexico |
12 |
13 |
33 |
33 |
||||||
|
Chile |
1 |
1 |
2 |
2 |
||||||
|
Natural Gas Customers (Thousands) |
||||||||||
|
Argentina |
1,488 |
1,444 |
||||||||
|
Mexico |
98 |
99 |
||||||||
|
Chile |
37 |
37 |
||||||||
|
Electric Sales (Millions of kWhs) |
||||||||||
|
Peru |
1,058 |
997 |
3,185 |
3,020 |
||||||
|
Chile |
511 |
474 |
1,752 |
1,484 |
||||||
|
Electric Customers (Thousands) |
||||||||||
|
Peru |
762 |
744 |
||||||||
|
Chile |
518 |
504 |
||||||||
|
Table E (Continued) |
|||||||
|
SEMPRA COMMODITIES |
|
|
|
|
|
||
|
Three months ended |
Nine months ended |
||||||
|
September 30, |
September 30, |
||||||
|
Margin * (Dollars in millions) |
2005 |
2004 |
2005 |
2004 |
|||
|
Geographical: |
|||||||
|
North America |
$ 254 |
$ 129 |
$ 548 |
$ 396 |
|||
|
Europe/Asia |
119 |
53 |
113 |
173 |
|||
|
Total |
$ 373 |
$ 182 |
$ 661 |
$ 569 |
|||
|
Product Line: |
|||||||
|
Gas |
$ 121 |
$ (11) |
$ 122 |
$ 83 |
|||
|
Power |
110 |
37 |
234 |
91 |
|||
|
Oil - Crude & Products |
89 |
107 |
160 |
198 |
|||
|
Metals |
3 |
16 |
42 |
125 |
|||
|
Other |
50 |
33 |
103 |
72 |
|||
|
Total |
$ 373 |
$ 182 |
$ 661 |
$ 569 |
|||
|
* Margin consists of net revenues less related costs (primarily brokerage, transportation and storage) plus or minus net interest expense/income, and is used by management in evaluating its geographical and product line performance. |
|||||||
|
Three months ended |
Nine months ended |
||||||
|
September 30, |
September 30, |
||||||
|
Effect of EITF 02-03 (Dollars in millions) |
2005 **** |
2004 |
2005 **** |
2004 |
|||
|
Mark-to-Market Earnings ** |
$ 153 |
$ 84 |
$ 282 |
$ 183 |
|||
|
Effect of EITF 02-03 *** |
8 |
(38) |
(66) |
(34) |
|||
|
GAAP Net Income |
$ 161 |
$ 46 |
$ 216 |
$ 149 |
|||
|
** Represents the fair market value of all commodities transactions. This metric is a useful measurement of profitability because it simultaneously recognizes changes in the various components of transactions and reflects how the business is managed. |
|||||||
|
*** Consists of the income statement effect of not recognizing changes in the fair market value of certain physical inventories and capacity contracts for transportation and storage. |
|||||||
|
**** Includes after-tax gain of $38 million related to the sale of certain storage assets. |
|||||||
|
Fair |
|||||||
|
Market Value |
|||||||
|
September 30, |
Scheduled Maturity (in months) |
||||||
|
Net Unrealized Revenue (Dollars in millions) |
2005 |
0 - 12 |
13 - 24 |
25 - 36 |
> 36 |
||
|
Sources of Over-the-Counter (OTC) Fair Value: |
|||||||
|
Prices actively quoted |
$ 835 |
$ 675 |
$ (120) |
$ 197 |
$ 83 |
||
|
Prices provided by other external sources |
32 |
(6) |
3 |
1 |
34 |
||
|
Prices based on models and other valuation methods |
9 |
12 |
|
|
(3) |
||
|
Total OTC Fair Value (1) |
$ 876 |
$ 681 |
$ (117) |
$ 198 |
$ 114 |
||
|
Maturity of OTC Fair Value |
|||||||
|
Percentage |
100.0% |
77.8% |
(13.4%) |
22.6% |
13.0% |
||
|
Cumulative Percentages |
|
77.8% |
64.4% |
87.0% |
100.0% |
||
|
|
|
|
|
|
|
||
|
Exchange Contracts (2) |
$ (276) |
$ (198) |
$ 143 |
$ (177) |
$ (44) |
||
|
Total Net Unrealized Revenue at September 30, 2005 |
$ 600 |
||||||
|
(1) The present value of unrealized revenue to be received or (paid) from outstanding OTC contracts |
|||||||
|
(2) Cash received or (paid) associated with open Exchange Contracts |
|||||||
|
September 30, |
December 31, |
||||||
|
Credit Quality of Unrealized Trading Assets (net of margin) |
2005 |
2004 |
|||||
|
Commodity Exchanges |
12% |
10% |
|||||
|
Investment Grade |
71% |
66% |
|||||
|
Below Investment Grade |
17% |
24% |
|||||
|
Three months ended |
Nine months ended |
||||||
|
September 30, |
September 30, |
||||||
|
Risk Adjusted Performance Indicators (Mark-to-Market Basis) |
2005 |
2004 |
2005 |
2004 |
|||
|
VaR at 95% (Dollars in millions) (1) |
$ 12.8 |
$ 8.4 |
$ 10.3 |
$ 6.9 |
|||
|
VaR at 99% (Dollars in millions) (2) |
$ 18.0 |
$ 11.9 |
$ 14.6 |
$ 9.7 |
|||
|
Risk Adjusted Return on Capital (RAROC) (3) |
41% |
45% |
38% |
40% |
|||
|
(1) Average Daily Value-at-Risk for the period using a 95% confidence level |
|||||||
|
(2) Average Daily Value-at-Risk for the period using a 99% confidence level |
|||||||
|
(3) Average Daily Trading Margin/Average Daily VaR at 95% confidence level |
|||||||
|
Physical Statistics |
|
|
|
|
|||
|
Natural Gas (BCF/Day) |
11.7 |
13.6 |
11.5 |
13.4 |
|||
|
Electric (Billions of kWhs) |
107.0 |
89.8 |
300.8 |
265.6 |
|||
|
Oil & Liquid Products (Millions Bbls/Day) |
1.9 |
2.5 |
2.0 |
2.1 |
|||
EXHIBIT 99.2
|
SEMPRA ENERGY |
||||||||||||||||||||
|
Table F (Unaudited) |
||||||||||||||||||||
|
Income Statement Data by Business Unit |
||||||||||||||||||||
|
Three Months Ended September 30, 2005 |
||||||||||||||||||||
|
(Dollars in millions) |
SDG&E |
SoCal Gas |
Commodities |
Generation |
Pipelines & Storage |
LNG |
Financial |
Consolidating Adjustments, Parent & Other |
|
Total |
||||||||||
|
|
||||||||||||||||||||
|
Operating Revenues |
$ 601 |
$ 910 |
$ 754 |
$ 462 |
$ 92 |
$ - |
$ - |
$ (93 |
) |
|
$ 2,726 |
|||||||||
|
|
||||||||||||||||||||
|
Operating Expenses |
438 |
825 |
615 |
407 |
88 |
8 |
1 |
108 |
|
2,490 |
||||||||||
|
|
||||||||||||||||||||
|
Depreciation & Amortization |
66 |
|
66 |
|
7 |
|
14 |
|
3 |
|
- |
|
(3 |
) |
4 |
|
|
157 |
||
|
|
||||||||||||||||||||
|
Operating Income |
97 |
19 |
132 |
41 |
1 |
(8 |
) |
2 |
(205 |
) |
|
79 |
||||||||
|
|
||||||||||||||||||||
|
Other Income, net |
3 |
|
- |
|
98 |
|
15 |
|
20 |
|
- |
|
(13 |
) |
8 |
|
|
131 |
||
|
|
||||||||||||||||||||
|
Income before Interest & Taxes (1) |
100 |
19 |
230 |
56 |
21 |
(8 |
) |
(11 |
) |
(197 |
) |
|
210 |
|||||||
|
|
||||||||||||||||||||
|
Net Interest Expense (2) |
6 |
9 |
8 |
7 |
(1 |
) |
- |
1 |
18 |
|
48 |
|||||||||
|
|
||||||||||||||||||||
|
Income Tax Expense/(Benefit) |
(8 |
) |
(26 |
) |
61 |
19 |
3 |
(3 |
) |
(20 |
) |
(86 |
) |
|
(60 |
) |
||||
|
|
||||||||||||||||||||
|
Discontinued Operations |
- |
- |
- |
- |
- |
- |
- |
(1 |
) |
|
(1 |
) |
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Net Income |
$ 102 |
|
$ 36 |
|
$ 161 |
|
$ 30 |
|
$ 19 |
|
$ (5 |
) |
$ 8 |
|
$ (130 |
) |
|
$ 221 |
||
|
Three Months Ended September 30, 2004 |
||||||||||||||||||||
|
(Dollars in millions) |
SDG&E |
SoCal Gas |
Commodities |
Generation |
Pipelines & Storage |
LNG |
Financial |
Consolidating Adjustments, Parent & Other |
|
Total |
||||||||||
|
|
||||||||||||||||||||
|
Operating Revenues |
$ 550 |
$ 826 |
$ 366 |
$ 439 |
$ 73 |
$ - |
$ - |
$ (89 |
) |
|
$ 2,165 |
|||||||||
|
|
||||||||||||||||||||
|
Operating Expenses |
368 |
636 |
282 |
334 |
72 |
6 |
1 |
(50 |
) |
|
1,649 |
|||||||||
|
|
||||||||||||||||||||
|
Depreciation & Amortization |
68 |
|
75 |
|
6 |
|
10 |
|
3 |
|
- |
|
5 |
|
4 |
|
|
171 |
||
|
|
||||||||||||||||||||
|
Operating Income |
114 |
115 |
78 |
95 |
(2 |
) |
(6 |
) |
(6 |
) |
(43 |
) |
|
345 |
||||||
|
|
||||||||||||||||||||
|
Other Income, net |
1 |
|
14 |
|
- |
|
12 |
|
13 |
|
- |
|
1 |
|
(1 |
) |
|
40 |
||
|
|
||||||||||||||||||||
|
Income before Interest & Taxes (1) |
115 |
129 |
78 |
107 |
11 |
(6 |
) |
(5 |
) |
(44 |
) |
|
385 |
|||||||
|
|
||||||||||||||||||||
|
Net Interest Expense (2) |
- |
9 |
3 |
7 |
- |
- |
2 |
30 |
|
51 |
||||||||||
|
|
||||||||||||||||||||
|
Income Tax Expense/(Benefit) |
55 |
52 |
29 |
36 |
4 |
(2 |
) |
(17 |
) |
(54 |
) |
|
103 |
|||||||
|
|
||||||||||||||||||||
|
Discontinued Operations |
- |
- |
- |
- |
- |
- |
- |
- |
|
- |
||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Net Income |
$ 60 |
|
$ 68 |
|
$ 46 |
|
$ 64 |
|
$ 7 |
|
$ (4 |
) |
$ 10 |
|
$ (20 |
) |
|
$ 231 |
||
|
(1) Management believes "Income before Interest & Taxes" (Operating Income plus Other Income, net) is a useful measurement of our business units' performance because it can be used to evaluate the effectiveness of our operations exclusive of interest and income taxes, neither of which is directly relevant to the efficiency of those operations. |
||||||||||||||||||||
|
(2) Net Interest Expense includes Interest Income, Interest Expense and Preferred Dividends of Subsidiaries. |
||||||||||||||||||||
|
Table F (Unaudited) (continued) |
||||||||||||||||||||
|
Income Statement Data by Business Unit |
||||||||||||||||||||
|
Nine Months Ended September 30, 2005 |
||||||||||||||||||||
|
(Dollars in millions) |
SDG&E |
SoCal Gas |
Commodities |
Generation |
Pipelines & Storage |
LNG |
Financial |
Consolidating Adjustments, Parent & Other |
|
Total |
||||||||||
|
|
||||||||||||||||||||
|
Operating Revenues |
$ 1,761 |
$ 3,091 |
$ 1,658 |
$ 1,237 |
$ 236 |
$ - |
$ - |
$ (293 |
) |
|
$ 7,690 |
|||||||||
|
|
||||||||||||||||||||
|
Operating Expenses |
1,302 |
2,647 |
1,408 |
1,025 |
218 |
23 |
2 |
13 |
|
6,638 |
||||||||||
|
|
||||||||||||||||||||
|
Depreciation & Amortization |
197 |
|
198 |
|
21 |
|
41 |
|
10 |
|
- |
|
8 |
|
6 |
|
|
481 |
||
|
|
||||||||||||||||||||
|
Operating Income |
262 |
246 |
229 |
171 |
8 |
(23 |
) |
(10 |
) |
(312 |
) |
|
571 |
|||||||
|
|
||||||||||||||||||||
|
Other Income, net |
4 |
|
(1 |
) |
98 |
|
15 |
|
43 |
|
- |
|
(14 |
) |
12 |
|
|
157 |
||
|
|
||||||||||||||||||||
|
Income before Interest & Taxes (1) |
266 |
245 |
327 |
186 |
51 |
(23 |
) |
(24 |
) |
(300 |
) |
|
728 |
|||||||
|
|
||||||||||||||||||||
|
Net Interest Expense (2) |
37 |
27 |
20 |
15 |
(1 |
) |
1 |
4 |
73 |
|
176 |
|||||||||
|
|
||||||||||||||||||||
|
Income Tax Expense/(Benefit) |
39 |
55 |
91 |
68 |
4 |
(9 |
) |
(47 |
) |
(217 |
) |
|
(16 |
) |
||||||
|
|
||||||||||||||||||||
|
Discontinued Operations |
- |
- |
- |
- |
- |
- |
- |
(3 |
) |
|
(3 |
) |
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Net Income |
$ 190 |
|
$ 163 |
|
$ 216 |
|
$ 103 |
|
$ 48 |
|
$ (15 |
) |
$ 19 |
|
$ (159 |
) |
|
$ 565 |
||
|
Nine Months Ended September 30, 2004 |
||||||||||||||||||||
|
(Dollars in millions) |
SDG&E |
SoCal Gas |
Commodities |
Generation |
Pipelines & Storage |
LNG |
Financial |
Consolidating Adjustments, Parent & Other |
|
Total |
||||||||||
|
|
||||||||||||||||||||
|
Operating Revenues |
$ 1,666 |
$ 2,821 |
$ 1,018 |
$ 1,175 |
$ 200 |
$ - |
$ - |
$ (359 |
) |
|
$ 6,521 |
|||||||||
|
|
||||||||||||||||||||
|
Operating Expenses |
1,168 |
2,277 |
763 |
937 |
192 |
12 |
2 |
(228 |
) |
|
5,123 |
|||||||||
|
|
||||||||||||||||||||
|
Depreciation & Amortization |
203 |
|
225 |
|
17 |
|
32 |
|
10 |
|
- |
|
7 |
|
7 |
|
|
501 |
||
|
|
||||||||||||||||||||
|
Operating Income |
295 |
319 |
238 |
206 |
(2 |
) |
(12 |
) |
(9 |
) |
(138 |
) |
|
897 |
||||||
|
|
||||||||||||||||||||
|
Other Income, net |
4 |
|
15 |
|
- |
|
(1 |
) |
54 |
|
13 |
|
(26 |
) |
(1 |
) |
|
58 |
||
|
|
||||||||||||||||||||
|
Income before Interest & Taxes (1) |
299 |
334 |
238 |
205 |
52 |
1 |
(35 |
) |
(139 |
) |
|
955 |
||||||||
|
|
||||||||||||||||||||
|
Net Interest Expense (2) |
31 |
27 |
7 |
20 |
1 |
- |
6 |
91 |
|
183 |
||||||||||
|
|
||||||||||||||||||||
|
Income Tax Expense/(Benefit) |
128 |
133 |
82 |
67 |
16 |
1 |
(67 |
) |
(169 |
) |
|
191 |
||||||||
|
|
||||||||||||||||||||
|
Discontinued Operations |
- |
- |
- |
- |
- |
- |
- |
(32 |
) |
|
(32 |
) |
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
Net Income |
$ 140 |
|
$ 174 |
|
$ 149 |
|
$ 118 |
|
$ 35 |
|
$ - |
|
$ 26 |
|
$ (93 |
) |
|
$ 549 |
||
|
(1) Management believes "Income before Interest & Taxes" (Operating Income plus Other Income, net) is a useful measurement of our business units' performance because it can be used to evaluate the effectiveness of our operations exclusive of interest and income taxes, neither of which is directly relevant to the efficiency of those operations. |
||||||||||||||||||||
|
(2) Net Interest Expense includes Interest Income, Interest Expense and Preferred Dividends of Subsidiaries. |
||||||||||||||||||||