Release and Selected Exhibits
Presentation and Complete Earnings Exhibits
SAN FRANCISCO, Calif.—PG&E Corporation's (NYSE: PCG) first-quarter 2015 net income after dividends on preferred stock (also called "income available for common shareholders") was $31 million or $0.06 per share, as reported in accordance with generally accepted accounting principles (GAAP). This compares with $227 million, or $0.49 per share, for the first quarter of 2014.
GAAP results include items that management does not consider part of normal, ongoing operations (items impacting comparability), which totaled $584 million pre-tax, or $0.81 per share, for the quarter. Chief among these items was the impact of penalties assessed by the California Public Utilities Commission (CPUC) in connection with the San Bruno accident, including a bill credit for customers and fines payable to the State General Fund.
"The lessons of San Bruno will never be forgotten and will continue to guide our work as we pursue our goal of becoming the nation's safest and most reliable utility. In recent years we've made significant progress in improving our safety culture and the condition of our infrastructure, as shown by becoming one of the first natural gas utilities to earn two respected international safety certifications and by our strong gains in electric reliability. We have much more to do. Moving forward, we will continue to implement our plans to invest in the utility's infrastructure and deploy new technology on behalf of our customers," said Tony Earley, Chairman, CEO, and President of PG&E Corporation.
First-Quarter Earnings from Operations
On a non-GAAP basis, excluding items impacting comparability, PG&E Corporation's earnings from operations for the first quarter of 2015 were $418 million, or $0.87 per share, up from $251 million, or $0.54 per share, during the same period in 2014. The largest factor contributing to this quarter-over-quarter increase was the timing of expense recovery authorized in the utility's 2014 General Rate Case.
2015 Earnings Guidance
PG&E Corporation is issuing 2015 guidance for non-GAAP earnings from operations of $3.50 to $3.70 per share. On a GAAP basis, the range for projected earnings is $1.93 to $2.25 per share, reflecting the impact of the penalties assessed by the CPUC as well as some other items. Guidance is based on various assumptions and forecasts, including those relating to expenses, authorized revenues, capital expenditures, rate base, and equity issuances.
PG&E Corporation discloses historical financial results and provides guidance based on "earnings from operations" in order to provide a measure that allows investors to compare the underlying financial performance of the business from one period to another, exclusive of items that management believes do not reflect the normal course of operations. Earnings from operations are not a substitute or alternative for consolidated income available for common shareholders presented in accordance with GAAP. See the accompanying tables for a reconciliation of the differences between results and guidance based on earnings from operations and results and guidance based on consolidated income available for common shareholders.
Supplemental Financial Information
In addition to the financial information accompanying this release, presentation slides for today's conference call with the financial community, including some of the assumptions and forecasts underlying 2015 EPS guidance, have been furnished to the Securities and Exchange Commission and are available on PG&E Corporation's website at: http://investor.pgecorp.com/financials/quarterly-earnings-reports/default.aspx.
Conference Call with the Financial Community to Discuss Financial Results
Today's call at 10:30 a.m., Eastern Time, is open to the public on a listen-only basis via webcast. Please visit http://investor.pgecorp.com/news-events/events-and-presentations/default.aspx for more information and instructions for accessing the webcast. The call will be archived on the website. Alternatively, a toll-free replay of the conference call may be accessed shortly after the live call until May 13, 2015, by dialing (866) 415-9493. International callers may dial (205) 289-3247. For both domestic and international callers, the replay pin 24147# will be required to access the replay.
Management's statements providing guidance for PG&E Corporation's 2015 financial results and the underlying assumptions and forecasts constitute forward-looking statements that reflect management's judgment and opinions. These statements and assumptions are necessarily subject to various risks and uncertainties, the realization or resolution of which may be outside management's control. Actual results may differ materially. Factors that could cause actual results to differ materially include:
About PG&E Corporation
- the outcome and timing of the 2015 Gas Transmission & Storage (GT&S) rate case, including the amount of revenue disallowance imposed as a penalty for improper ex-parte communications;
- the timing and amount of fines, penalties, and remedial costs that the Utility may incur in connection with the federal criminal prosecution of the Utility, the CPUC's investigation of the Utility's natural gas distribution operations, the CPUC Safety and Enforcement Division's unresolved enforcement actions, and the other investigations that have been or may be commenced relating to the Utility's compliance with natural gas-related laws and regulations;
- the timing and outcome of the CPUC's investigation and the pending criminal investigations relating to communications between the Utility and the CPUC that may have violated the CPUC's rules regarding ex-parte communications or are otherwise alleged to be improper, and whether such matters negatively affect the final decisions to be issued in the 2015 GT&S rate case or other ratemaking proceedings;
- the Utility's ability to control its costs within the adopted levels of spending and the extent to which actual costs that are not recovered through rates exceed the forecast of unrecovered costs due to changes in cost forecasts or the scope and timing of planned work;
- the outcome of the CPUC's investigation into the Utility's safety culture;
- the amount and timing of additional common stock issuances by PG&E Corporation;
- the ability of PG&E Corporation and the Utility to access capital markets and other sources of debt and equity financing in a timely manner on acceptable terms;
- the outcome of federal or state tax audits and the impact of any changes in federal or state tax laws, policies, regulations, or their interpretation; and
- the other factors disclosed in PG&E Corporation's and the Utility's joint Annual Report on Form 10-K for the year ended December 31, 2014.
PG&E Corporation (NYSE: PCG) is a Fortune 200 energy-based holding company, headquartered in San Francisco. It is the parent company of Pacific Gas and Electric Company, California's largest investor-owned utility. PG&E serves about 16 million Californians across a 70,000 square-mile service area in Northern and Central California. For more information, visit the Web site at http://www.pgecorp.com.