Sempra Reports 2023 Financial and Business Results

Rhea-AI Summary

Sempra (SRE) reports strong full-year 2023 earnings, with a 20% increase in capital plan to $48 billion. The company raises its common stock dividend for the 14th consecutive year and narrows full-year 2024 EPS guidance range. Sempra affirms a projected long-term EPS growth rate of 6-8%.

Positive

• Sempra reports robust full-year 2023 earnings of $3.03 billion, a significant increase from 2022.
• The company announces a 20% increase in its capital plan to $48 billion, reflecting growth opportunities in the energy sector.
• Sempra raises its common stock dividend for the 14th consecutive year, showcasing commitment to shareholder value.
• The company narrows its full-year 2024 EPS guidance range and issues a 2025 EPS guidance range, projecting a 7% increase year-over-year.
• Sempra affirms a 6-8% projected long-term EPS growth rate, highlighting sustainable growth prospects.
• Sempra's three growth platforms - Sempra California, Sempra Texas, and Sempra Infrastructure - demonstrate strong performance and strategic investments in energy infrastructure.
• The company's financial results reflect continued improvements in corporate strategy and execution, driving long-term total returns for investors.

Negative

• None.

Insights

Financial Analyst

The announcement by Sempra of a 20% increase in its capital plan to $48 billion signifies a substantial investment in energy infrastructure, which is a critical indicator of the company's growth trajectory and future earnings potential. This expansion is particularly noteworthy as it aligns with the increasing demand for cleaner and more reliable energy sources. The capital deployment into Sempra California and Sempra Texas, which accounts for over 90% of this investment, is expected to enhance the company's asset base and drive rate base growth, which is a key driver of utility earnings.

The 14th consecutive year of dividend increase reflects a strong commitment to returning value to shareholders and suggests confidence in the company's financial stability and profitability. The increment in the common stock dividend to $2.48 per share annually from $2.38 per share indicates a healthy cash flow position, which is attractive to income-focused investors.

Furthermore, the narrowing of the full-year 2024 EPS guidance to $4.60 to $4.90 and setting the 2025 EPS guidance range to $4.90 to $5.25, with a projected long-term EPS growth rate of 6-8%, provides transparency and may reduce uncertainty for investors. This guidance reflects management's expectations of continued operational efficiency and successful execution of its strategic initiatives. The 7% year-over-year increase from the midpoint of the full-year 2024 EPS guidance range is a positive signal for investors looking for consistent growth.

Energy Sector Analyst

The investments in capital projects such as the installation of utility-owned battery storage and microgrids by Sempra California are indicative of the utility industry's shift towards enhancing grid reliability and integrating renewable energy sources. This transition is not only a response to regulatory pressures but also to consumer demand for sustainable energy solutions. The recognition of Sempra California for sustainability and innovation could position the company as a leader in the energy transition, potentially increasing its competitive advantage in the market.

At Sempra Texas, the significant capital investment and the resulting rate base growth underscore the region's economic expansion and the corresponding rise in energy consumption. The diversification of energy sources, with a substantial portion of interconnection requests coming from solar and storage, is aligned with broader industry trends towards decarbonization. The legislative and regulatory outcomes achieved in 2023 that support infrastructure investments and timely capital recovery are crucial for maintaining the pace of growth and meeting the state's energy needs.

Sempra Infrastructure's focus on LNG, hydrogen and carbon capture projects caters to the global demand for cleaner fuels and energy security. The progress at ECA LNG Phase 1 and Port Arthur LNG Phase 1, along with the secured project-level financing, are significant milestones that highlight the company's strategic positioning in the growing LNG export market.

Market Research Analyst

The energy infrastructure sector is experiencing a surge in investment opportunities due to the global push for decarbonization and the need for modernizing aging infrastructure. Sempra's record capital plan reflects a broader market trend where utilities are increasingly channeling funds into projects that promise long-term growth and sustainability. The company's strategic focus on infrastructure development across North America, particularly in key economic markets like California and Texas, is likely to resonate well with investors who are mindful of regional growth potentials and regulatory environments.

The increase in Sempra's capital plan may also stimulate job creation, foster economic development and potentially lead to operational efficiencies that can translate into improved margins. However, investors will be closely monitoring the execution of this capital plan, as any delays or cost overruns could impact projected earnings and shareholder returns.

The financial performance of Sempra in 2023 with GAAP earnings of $3.03 billion or $4.79 per diluted share, compared to $2.09 billion or $3.31 per diluted share in the previous year, indicates robust growth. This performance, coupled with a consistent dividend payout, could attract a broader investor base, including value and growth investors. The company's ability to maintain a steady growth rate in a capital-intensive industry may serve as a benchmark for evaluating future investment opportunities within the sector.

• Announces 20% Increase in Capital Plan to $48 Billion
• Raises Annualized Common Stock Dividend for 14^th Consecutive Year
• Narrows Full-Year 2024 and Issues 2025 EPS Guidance Ranges
• Affirms 6-8% Projected Long-Term EPS Growth Rate

SAN DIEGO, Feb. 27, 2024 /PRNewswire/ -- Sempra (NYSE: SRE) (BMV: SRE) today reported full-year 2023 earnings, prepared in accordance with Generally Accepted Accounting Principles (GAAP), of $3.03 billion or $4.79 per diluted share, compared to full-year 2022 GAAP earnings of $2.09 billion or $3.31 per diluted share. On an adjusted basis, full-year earnings were $2.92 billion or $4.61 per diluted share in both 2023 and 2022.

"Strong business performance in 2023 reflects continued improvements in our corporate strategy and consistency in execution," said Jeffrey W. Martin, chairman and CEO of Sempra. "At Sempra, our goal is to give investors exposure to attractive growth in the energy infrastructure sector with the support of a growing dividend and a management team committed to providing superior, long-term total returns."

The company also reported fourth-quarter 2023 GAAP earnings of $737 million or $1.16 per diluted share, compared to fourth-quarter 2022 GAAP earnings of $438 million or $0.69 per diluted share. On an adjusted basis, the company's fourth-quarter 2023 earnings were $719 million or $1.13 per diluted share, compared to $743 million or $1.17 per diluted share in fourth-quarter 2022.

The reported 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 2023 and 2022.

	(Dollars and shares in millions, except EPS)	Three months ended December 31,				Years ended December 31,
		2023		2022		2023		2022
	GAAP Earnings	$     737		$     438		$ 3,030		$ 2,094
	Impact associated with Aliso Canyon litigation and regulatory matters	—		—		—		199
	Equity losses from write-off of rate base disallowances resulting from Public Utility     Commission of Texas' final order in Oncor Electric Delivery Company LLC's     comprehensive base rate review	—		—		44		—
	Impact from foreign currency and inflation on monetary positions in Mexico	69		75		235		164
	Net unrealized (gains) losses on commodity derivatives	(47)		247		(366)		355
	Net unrealized (gains) losses on contingent interest rate swap related to initial phase of     the Port Arthur LNG liquefaction project	—		(17)		17		(17)
	Deferred income tax expense associated with change in indefinite reinvestment assertion     related to sale of noncontrolling interest to Abu Dhabi Investment Authority	—		—		—		120
	Earnings from investment in RBS Sempra Commodities LLP	(40)		—		(40)		—
	Adjusted Earnings(1)	$     719		$     743		$ 2,920		$ 2,915
	Diluted Weighted-Average Common Shares Outstanding	634		632		633		633
	GAAP EPS	$   1.16		$   0.69		$   4.79		$   3.31
	Adjusted EPS(1)	$   1.13		$   1.17		$   4.61		$   4.61
	1)  See Table A for information regarding non-GAAP financial measures and descriptions of adjustments.

Capital Plan Growth

Across North America, the growing need to connect people to safer, more reliable and cleaner energy is driving significant investment opportunities in the transmission and distribution portion of the energy value chain. In response to this opportunity, Sempra is forecasting a company-record five-year capital plan of approximately $48 billion, representing a 20% increase from the previous capital plan. Over 90% of these investments are focused on Sempra California and Sempra Texas.

"Strong projected growth in Sempra's core markets is driving a substantial increase in our five-year capital plan," said Karen Sedgwick, executive vice president and chief financial officer of Sempra. "Expanding our capital campaign also supports our confidence in our ability to deliver sustainable, long-term value for our owners."

Progress at Sempra's Three Growth Platforms

Sempra's three growth platforms – Sempra California, Sempra Texas and Sempra Infrastructure – deliver energy to nearly 40 million consumers across some of the world's most significant economic markets, including California, Texas, Mexico and global energy markets.

Sempra California

Serving roughly 25 million consumers, Sempra California is a dual-utility platform focused on connecting people to safer, more reliable and cleaner energy. In 2023, $4.6 billion was invested in capital projects, including installing 200 megawatts of new utility-owned battery storage and microgrids to help enhance grid reliability and strengthen community resilience. 

In California, our regulated utilities continue to earn recognition for both sustainability and innovation. In the fourth quarter of 2023, the [H2] Innovation Experience was named to Fast Company's list of the Next Big Things in Tech. Sempra California's electric network was recognized by PA Consulting for Outstanding Grid Sustainability and for Outstanding Reliability Performance, a reliability distinction it has earned for 18 years in a row.

Additionally, progress continues with the general rate cases before the California Public Utilities Commission including proposed partial settlements reached with certain intervenors. A proposed decision is scheduled for the second quarter of 2024.

Sempra Texas

Broad economic growth is driving new investment opportunities at Sempra Texas. In 2023, roughly $3.8 billion of capital was invested by Oncor Electric Delivery Company LLC (Oncor) to support the growing needs of its customers, resulting in approximately 12% rate base growth since year-end 2022.

Nearly $1.6 billion of transmission projects were placed into service by Oncor in 2023, including placement of over 40 major substations and over 30 major switching stations and approximately 390 circuit miles of new or upgraded high-voltage transmission lines. Additionally, in 2023, Oncor saw a 25% increase in active generation and retail transmission interconnection requests as compared to 2022. Of the approximately 480 active generation point of interconnection requests in the queue at the end of 2023, 46% were solar, 42% were storage, 9% were wind and 3% were natural gas.

Several constructive legislative and regulatory outcomes were achieved in 2023 that are expected to support critical new infrastructure investments in the Texas market, while also improving the timeliness of capital recovery.

Sempra Infrastructure 

Sempra Infrastructure delivered strong financial and operational performance in 2023, a testament to its effectiveness as a high-growth, lower-carbon business focused on delivering cleaner and more secure energy to customers around the world.

Cameron LNG Phase 1 continues to be highly efficient, delivering excess production and achieving over 700 cargoes loaded since production began. As the company looks to expand its liquefied natural gas (LNG) portfolio, significant progress continues at Energía Costa Azul (ECA) LNG Phase 1 and Port Arthur LNG Phase 1. ECA LNG Phase 1 remains on track for commercial operations in summer 2025. 

In 2023, Sempra Infrastructure made a positive Final Investment Decision on Port Arthur LNG Phase 1 and project-level financing was secured. Sempra also closed the sales of indirect non-controlling interests in the project to ConocoPhillips and KKR.

In addition, Sempra Infrastructure continues to advance development efforts for its various LNG, hydrogen and carbon capture projects in response to continued global demand for cleaner fuels to support the decarbonization of the power sector and improve energy security.

Earnings Guidance

Sempra is narrowing its full-year 2024 earnings-per-common share (EPS) guidance range to $4.60 to $4.90 and announcing a full-year 2025 EPS guidance range of $4.90 to $5.25, which represents a 7% year-over-year increase from the midpoint of the full-year 2024 EPS guidance range. The company is also affirming its projected long-term EPS growth rate of approximately 6% to 8%.

Common and Preferred Dividends

Sempra's board of directors declared a $0.62 per share quarterly dividend on the company's common stock, which is payable April 15, 2024, to common stock shareholders of record at the close of business on March 21, 2024. The declared quarterly dividend represents an increase of the company's common stock dividend to $2.48 per share, on an annualized basis, from $2.38 per share in 2023.

Additionally, Sempra's board of directors declared a semi-annual dividend of $24.375 per share on the company's 4.875% Fixed-Rate Reset Cumulative Redeemable Perpetual Preferred Stock, Series C. The preferred stock dividends will be payable April 15, 2024, to preferred stock shareholders of record at the close of business on April 1, 2024.

Non-GAAP Financial Measures

Non-GAAP financial measures include Sempra's adjusted earnings and adjusted EPS. See Table A for additional information regarding these non-GAAP financial measures.

Internet Broadcast

Sempra will broadcast a live discussion of its earnings results over the internet today at 12 p.m. ET with the company's senior management. Access is available by logging onto the Investors section of the company's website, sempra.com/investors. The webcast will be available on replay a few hours after its conclusion at sempra.com/investors.

About Sempra

Sempra is a leading North American energy infrastructure company focused on delivering energy to nearly 40 million consumers. As owner of one of the largest energy networks on the continent, Sempra is electrifying and improving the energy resilience of some of the world's most significant economic markets, including California, Texas, Mexico and global energy market. The company is recognized as a leader in sustainable business practices and for its high-performance culture focused on safety and operational excellence, as demonstrated by Sempra's inclusion in the Dow Jones Sustainability Index North America and in The Wall Street Journal's Best Managed Companies. More information about Sempra is available at sempra.com and on social media @Sempra.

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on assumptions about the future, involve risks and uncertainties, and are not guarantees. Future results may differ materially from those expressed or implied in any forward-looking statement. These forward-looking statements represent our estimates and assumptions only as of the date of this press release. We assume no obligation to update or revise any forward-looking statement as a result of new information, future events or otherwise.

In this press release, forward-looking statements can be identified by words such as "believe," "expect," "intend," "anticipate," "contemplate," "plan," "estimate," "project," "forecast," "envision," "should," "could," "would," "will," "confident," "may," "can," "potential," "possible," "proposed," "in process," "construct," "develop," "opportunity," "preliminary," "initiative," "target," "outlook," "optimistic," "poised," "maintain," "continue," "progress," "advance," "goal," "aim," "commit," or similar expressions, or when we discuss our guidance, priorities, strategy, goals, vision, mission, opportunities, projections, intentions or expectations.

Factors, among others, that could cause actual results and events to differ materially from those expressed or implied in any forward-looking statement include: California wildfires, including potential liability for damages regardless of fault and any inability to recover all or a substantial portion of costs from insurance, the wildfire fund established by California Assembly Bill 1054, rates from customers or a combination thereof; decisions, investigations, inquiries, regulations, denials or revocations of permits, consents, approvals or other authorizations, renewals of franchises, and other actions, including the failure to honor contracts and commitments, by the (i) California Public Utilities Commission (CPUC), Comisión Reguladora de Energía, U.S. Department of Energy, U.S. Federal Energy Regulatory Commission, Public Utility Commission of Texas, U.S. Internal Revenue Service and other regulatory bodies and (ii) U.S., Mexico and states, counties, cities and other jurisdictions therein and in other countries where we do business; the success of business development efforts, construction projects, acquisitions, divestitures, and other significant transactions, including risks related to (i) being able to make a final investment decision, (ii) completing construction projects or other transactions on schedule and budget, (iii) realizing anticipated benefits from any of these efforts if completed, (iv) obtaining third-party consents and approvals, and (v) third parties honoring their contracts and commitments; macroeconomic trends or other factors that could change our capital expenditure plans and their potential impact on rate base or other growth; litigation, arbitrations, property disputes and other proceedings, and changes to laws and regulations, including those related to tax and trade policy and the energy industry in Mexico; cybersecurity threats, including by state and state-sponsored actors, of ransomware or other attacks on our systems or the systems of third parties with which we conduct business, including the energy grid or other energy infrastructure; the availability, uses, sufficiency, and cost of capital resources and our ability to borrow money or otherwise raise capital on favorable terms and meet our obligations, including due to (i) actions by credit rating agencies to downgrade our credit ratings or place those ratings on negative outlook, (ii) instability in the capital markets, or (iii) rising interest rates and inflation; the impact on affordability of San Diego Gas & Electric Company's (SDG&E) and Southern California Gas Company's (SoCalGas) customer rates and their cost of capital and on SDG&E's, SoCalGas' and Sempra Infrastructure's ability to pass through higher costs to customers due to (i) volatility in inflation, interest rates and commodity prices, (ii) with respect to SDG&E's and SoCalGas' businesses, the cost of meeting the demand for lower carbon and reliable energy in California, and (iii) with respect to Sempra Infrastructure's business, volatility in foreign currency exchange rates; the impact of climate and sustainability policies, laws, rules, regulations, disclosures and trends, including actions to reduce or eliminate reliance on natural gas, increased uncertainty in the political or regulatory environment for California natural gas distribution companies, the risk of nonrecovery for stranded assets, and uncertainty related to relevant emerging and early-stage technologies; weather, natural disasters, pandemics, accidents, equipment failures, explosions, terrorism, information system outages or other events, such as work stoppages, that disrupt our operations, damage our facilities or systems, cause the release of harmful materials or fires or subject us to liability for damages, fines and penalties, some of which may not be recoverable through regulatory mechanisms or insurance or may impact our ability to obtain satisfactory levels of affordable insurance; the availability of electric power, natural gas and natural gas storage capacity, including disruptions caused by failures in the transmission grid, pipeline system or limitations on the withdrawal of natural gas from storage facilities; Oncor Electric Delivery Company LLC's (Oncor) ability to reduce or eliminate its quarterly dividends due to regulatory and governance requirements and commitments, including by actions of Oncor's independent directors or a minority member director; and other uncertainties, some of which are difficult to predict and beyond our control.

These risks and uncertainties are further discussed in the reports that Sempra 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 Sempra's website, www.sempra.com. Investors should not rely unduly on any forward-looking statements.

Sempra Infrastructure, Sempra Infrastructure Partners, Sempra Texas, Sempra Texas Utilities, Oncor and Infraestructura Energética Nova, S.A.P.I. de C.V. (IEnova) are not the same companies as the California utilities, SDG&E or SoCalGas, and Sempra Infrastructure, Sempra Infrastructure Partners, Sempra Texas, Sempra Texas Utilities, Oncor and IEnova are not regulated by the CPUC.

None of the website references in this press release are active hyperlinks, and the information contained on, or that can be accessed through, any such website is not, and shall not be deemed to be, part of this document. 

SEMPRA
Table A
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in millions, except per share amounts; shares in thousands)
									Three months ended December 31,												Years ended December 31,
									2023						2022						2023(1)						2022(1)
REVENUES
Utilities:
Natural gas									$	1,935					$	2,257					$	9,495					$	7,868
Electric									1,003						1,120						4,334						4,783
Energy-related businesses									553						78						2,891						1,788
Total revenues									3,491						3,455						16,720						14,439
EXPENSES AND OTHER INCOME
Utilities:
Cost of natural gas									(465)						(768)						(3,719)						(2,603)
Cost of electric fuel and purchased power									10						(174)						(375)						(937)
Energy-related businesses cost of sales									(111)						(178)						(548)						(942)
Operation and maintenance									(1,500)						(1,292)						(5,458)						(4,746)
Aliso Canyon litigation and regulatory matters									—						—						—						(259)
Depreciation and amortization									(576)						(519)						(2,227)						(2,019)
Franchise fees and other taxes									(168)						(161)						(677)						(635)
Other income, net									56						27						131						24
Interest income									29						17						89						75
Interest expense									(314)						(258)						(1,309)						(1,054)
Income before income taxes and equity earnings									452						149						2,627						1,343
Income tax benefit (expense)									9						(121)						(490)						(556)
Equity earnings									395						380						1,481						1,498
Net income									856						408						3,618						2,285
(Earnings) losses attributable to noncontrolling interests									(108)						41						(543)						(146)
Preferred dividends									(11)						(11)						(44)						(44)
Preferred dividends of subsidiary									—						—						(1)						(1)
Earnings attributable to common shares									$	737					$	438					$	3,030					$	2,094
Basic earnings per common share (EPS):
Earnings									$	1.17					$	0.70					$	4.81					$	3.32
Weighted-average common shares outstanding									631,284						629,476						630,296						630,318
Diluted EPS:
Earnings									$	1.16					$	0.69					$	4.79					$	3.31
Weighted-average common shares outstanding									634,228						632,295						632,733						632,757

(1)  Derived from audited financial statements.

 

SEMPRA
Table A (Continued)

RECONCILIATION OF SEMPRA ADJUSTED EARNINGS TO SEMPRA GAAP EARNINGS

Sempra Adjusted Earnings and Adjusted EPS exclude items (after the effects of income taxes and, if applicable, noncontrolling interests) in 2023 and 2022 as follows:

Three months ended December 31, 2023:

• $(69) million impact from foreign currency and inflation on our monetary positions in Mexico
• $47 million net unrealized gains on commodity derivatives
• $40 million equity earnings from investment in RBS Sempra Commodities LLP based on a legal settlement

 Three months ended December 31, 2022:

• $(75) million impact from foreign currency and inflation on our monetary positions in Mexico
• $(247) million net unrealized losses on commodity derivatives
• $17 million net unrealized gains on a contingent interest rate swap related to the proposed initial phase of the Port Arthur LNG liquefaction project

Year ended December 31, 2023:

• $(44) million equity losses from investment in Oncor Electric Delivery Holdings Company LLC related to a write-off of rate base disallowances resulting from the Public Utility Commission of Texas' final order in Oncor Electric Delivery Company LLC's comprehensive base rate review
• $(235) million impact from foreign currency and inflation on our monetary positions in Mexico
• $366 million net unrealized gains on commodity derivatives
• $(17) million net unrealized losses on a contingent interest rate swap related to the initial phase of the Port Arthur LNG liquefaction project
• $40 million equity earnings from investment in RBS Sempra Commodities LLP based on a legal settlement

Year ended December 31, 2022:

• $(199) million impact associated with Aliso Canyon natural gas storage facility litigation and regulatory matters at Sempra California
• $(164) million impact from foreign currency and inflation on our monetary positions in Mexico
• $(355) million net unrealized losses on commodity derivatives
• $17 million net unrealized gains on a contingent interest rate swap related to the proposed initial phase of the Port Arthur LNG liquefaction project
• $(120) million deferred income tax expense associated with the change in our indefinite reinvestment assertion as a result of progress in obtaining regulatory approvals necessary to close the sale of 10% noncontrolling interest in Sempra Infrastructure Partners, LP to Abu Dhabi Investment Authority

Sempra Adjusted Earnings and Adjusted EPS are non-GAAP financial measures (GAAP represents generally accepted accounting principles in the United States of America). These non-GAAP financial measures exclude significant items that are generally not related to our ongoing business activities and/or are infrequent in nature. These non-GAAP financial measures also exclude the impact from foreign currency and inflation on our monetary positions in Mexico and net unrealized gains and losses on commodity derivatives, which we expect to occur in future periods, and which can vary significantly from one period to the next. Exclusion of these items is useful to management and investors because it provides a meaningful comparison of the performance of Sempra'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 GAAP Earnings and GAAP EPS, which we consider to be the most directly comparable financial measures calculated in accordance with GAAP.

SEMPRA
Table A (Continued)
RECONCILIATION OF ADJUSTED EARNINGS TO GAAP EARNINGS
(Dollars in millions, except EPS; shares in thousands)
						Pretax amount			Income tax expense (benefit)(1)			Non-controlling interests			Earnings						Pretax amount			Income tax expense (benefit)(1)			Non-controlling interests			Earnings
						Three months ended December 31, 2023															Three months ended December 31, 2022
Sempra GAAP Earnings															$	737														$	438
Excluded items:
Impact from foreign currency and inflation on monetary positions in Mexico						$	22		$	80		$	(33)		69						$	19		$	89		$	(33)		75
Net unrealized (gains) losses on commodity derivatives						(92)			16			29			(47)						486			(96)			(143)			247
Net unrealized gains on contingent interest rate swap related to proposed initial phase of             the Port Arthur LNG liquefaction project						—			—			—			—						(33)			6			10			(17)
Earnings from investment in RBS Sempra Commodities LLP						(40)			—			—			(40)						—			—			—			—
Sempra Adjusted Earnings															$	719														$	743
Diluted EPS:
Weighted-average common shares outstanding, diluted															634,228															632,295
Sempra GAAP EPS															$	1.16														$	0.69
Sempra Adjusted EPS															$	1.13														$	1.17
						Year ended December 31, 2023															Year ended December 31, 2022
Sempra GAAP Earnings															$	3,030														$	2,094
Excluded items:
Impact associated with Aliso Canyon litigation and regulatory matters						$	—		$	—		$	—		—						$	259		$	(60)		$	—		199
Equity losses from write-off of rate base disallowances resulting from Public Utility              Commission of Texas' final order in Oncor Electric Delivery Company LLC's              comprehensive base rate review						—			—			—			44						—			—			—			—
Impact from foreign currency and inflation on monetary positions in Mexico						62			283			(110)			235						49			169			(54)			164
Net unrealized (gains) losses on commodity derivatives						(722)			144			212			(366)						669			(138)			(176)			355
Net unrealized losses (gains) on contingent interest rate swap related to initial phase of              the Port Arthur LNG liquefaction project						33			(6)			(10)			17						(33)			6			10			(17)
Deferred income tax expense associated with change in indefinite reinvestment assertion              related to sale of noncontrolling interest to Abu Dhabi Investment Authority						—			—			—			—						—			120			—			120
Earnings from investment in RBS Sempra Commodities LLP						(40)			—			—			(40)						—			—			—			—
Sempra Adjusted Earnings															$	2,920														$	2,915
Diluted EPS:
Weighted-average common shares outstanding, diluted															632,733															632,757
Sempra GAAP EPS															$	4.79														$	3.31
Sempra Adjusted EPS															$	4.61														$	4.61

(1)

Except for adjustments that are solely income tax, income taxes on pretax amounts were primarily calculated based on applicable statutory tax rates. We record equity losses for our investment in Oncor Electric Delivery Holdings Company LLC net of income tax. We did not record an income tax expense for the equity earnings from our investment in RBS Sempra Commodities LLP because, even though a portion may be deductible under United Kingdom tax law, it is not probable that the deduction will reduce United Kingdom taxes.

 

SEMPRA
Table B
CONSOLIDATED BALANCE SHEETS
(Dollars in millions)
			December 31,
			2023(1)						2022(1)
ASSETS
Current assets:
Cash and cash equivalents			$	236					$	370
Restricted cash			49						40
Accounts receivable – trade, net			2,151						2,635
Accounts receivable – other, net			561						685
Due from unconsolidated affiliates			31						54
Income taxes receivable			94						113
Inventories			482						403
Prepaid expenses			273						268
Regulatory assets			226						351
Fixed-price contracts and other derivatives			122						803
Greenhouse gas allowances			1,189						141
Other current assets			56						49
Total current assets			5,470						5,912
Other assets:
Restricted cash			104						52
Regulatory assets			3,771						2,588
Greenhouse gas allowances			301						796
Nuclear decommissioning trusts			872						841
Dedicated assets in support of certain benefit plans			549						505
Deferred income taxes			129						135
Right-of-use assets – operating leases			723						655
Investment in Oncor Holdings			14,266						13,665
Other investments			2,244						2,012
Goodwill			1,602						1,602
Other intangible assets			318						344
Wildfire fund			269						303
Other long-term assets			1,603						1,382
Total other assets			26,751						24,880
Property, plant and equipment, net			54,960						47,782
Total assets			$	87,181					$	78,574
(1)  Derived from audited financial statements
SEMPRA
Table B (Continued)
CONSOLIDATED BALANCE SHEETS (CONTINUED)
(Dollars in millions)
			December 31,
			2023(1)						2022(1)
LIABILITIES AND EQUITY
Current liabilities:
Short-term debt			$	2,342					$	3,352
Accounts payable – trade			2,211						1,994
Accounts payable – other			224						275
Due to unconsolidated affiliates			5						—
Dividends and interest payable			691						621
Accrued compensation and benefits			526						484
Regulatory liabilities			553						504
Current portion of long-term debt and finance leases			975						1,019
Reserve for Aliso Canyon costs			31						129
Greenhouse gas obligations			1,189						141
Other current liabilities			1,343						1,380
Total current liabilities			10,090						9,899
Long-term debt and finance leases			27,759						24,548
Deferred credits and other liabilities:
Due to unconsolidated affiliates			307						301
Regulatory liabilities			3,739						3,341
Greenhouse gas obligations			—						565
Pension and other postretirement benefit plan obligations, net of plan assets			407						410
Deferred income taxes			5,254						4,591
Asset retirement obligations			3,642						3,546
Deferred credits and other			2,329						2,117
Total deferred credits and other liabilities			15,678						14,871
Equity:
Sempra shareholders' equity			28,675						27,115
Preferred stock of subsidiary			20						20
Other noncontrolling interests			4,959						2,121
Total equity			33,654						29,256
Total liabilities and equity			$	87,181					$	78,574

(1)  Derived from audited financial statements.

 

SEMPRA
Table C
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in millions)
			Years ended December 31,
			2023(1)						2022(1)
CASH FLOWS FROM OPERATING ACTIVITIES
Net income			$	3,618					$	2,285
Adjustments to reconcile net income to net cash provided by operating activities			853						2,025
Reserve for Aliso Canyon costs			(98)						(1,851)
Net change in other working capital components			1,527						(1,967)
Insurance receivable for Aliso Canyon costs			—						360
Distributions from investments			912						854
Changes in other noncurrent assets and liabilities, net			(594)						(564)
Net cash provided by operating activities			6,218						1,142
CASH FLOWS FROM INVESTING ACTIVITIES
Expenditures for property, plant and equipment			(8,397)						(5,357)
Expenditures for investments and acquisitions			(382)						(376)
Proceeds from sale of assets			3						—
Purchases of nuclear decommissioning and other trust assets			(610)						(700)
Proceeds from sales of nuclear decommissioning and other trust assets			661						762
Repayments of advances to unconsolidated affiliates			—						626
Other			9						6
Net cash used in investing activities			(8,716)						(5,039)
CASH FLOWS FROM FINANCING ACTIVITIES
Common dividends paid			(1,483)						(1,430)
Preferred dividends paid			(44)						(44)
Issuances of common stock, net			145						4
Repurchases of common stock			(32)						(478)
Issuances of debt (maturities greater than 90 days)			7,669						9,984
Payments on debt (maturities greater than 90 days) and finance leases			(6,294)						(4,510)
Increase (decrease) in short-term debt, net			552						(1,266)
Advances from unconsolidated affiliates			31						28
Proceeds from sales of noncontrolling interests, net			1,219						1,732
Distributions to noncontrolling interests			(730)						(237)
Contributions from noncontrolling interests			1,570						31
Settlement of cross-currency swaps			(99)						—
Other			(85)						(35)
Net cash provided by financing activities			2,419						3,779
Effect of exchange rate changes on cash, cash equivalents and restricted cash			6						(1)
Decrease in cash, cash equivalents and restricted cash			(73)						(119)
Cash, cash equivalents and restricted cash, January 1			462						581
Cash, cash equivalents and restricted cash, December 31			$	389					$	462

(1)  Derived from audited financial statements.

 

SEMPRA
Table D
SEGMENT EARNINGS (LOSSES) AND CAPITAL EXPENDITURES AND INVESTMENTS
(Dollars in millions)
									Three months ended December 31,												Years ended December 31,
									2023						2022						2023(1)						2022(1)
Earnings (Losses) Attributable to Common Shares
Sempra California									$	500					$	494					$	1,747					$	1,514
Sempra Texas Utilities									146						132						694						736
Sempra Infrastructure									131						(82)						877						310
Parent and other									(40)						(106)						(288)						(466)
Total									$	737					$	438					$	3,030					$	2,094
									Three months ended December 31,												Years ended December 31,
									2023						2022						2023(1)						2022(1)
Capital Expenditures and Investments
Sempra California									$	1,216					$	1,421					$	4,560					$	4,466
Sempra Texas Utilities									97						90						367						346
Sempra Infrastructure									1,111						406						3,847						914
Parent and other									—						1						5						7
Total									$	2,424					$	1,918					$	8,779					$	5,733

(1)  Derived from audited financial statements.

 

			SEMPRA
			Table E
OTHER OPERATING STATISTICS
						Three months ended December 31,												Years ended or at December 31,
						2023						2022						2023						2022
UTILITIES
Sempra California
Gas sales (Bcf)(1)						89						109						369						349
Transportation (Bcf)(1)						150						163						588						625
Total deliveries (Bcf)(1)						239						272						957						974
Total gas customer meters (thousands)																		7,078						7,040
Electric sales (millions of kWhs)(1)						974						1,715						4,619						7,800
Community Choice Aggregation and Direct Access (millions of kWhs)(2)						3,227						2,765						12,228						9,900
Total deliveries (millions of kWhs)(1)						4,201						4,480						16,847						17,700
Total electric customer meters (thousands)																		1,517						1,504
Oncor Electric Delivery Company LLC(3)
Total deliveries (millions of kWhs)						35,906						33,680						156,477						149,260
Total electric customer meters (thousands)																		3,969						3,896
Ecogas México, S. de R.L. de C.V.
Natural gas sales (Bcf)						1						1						4						4
Natural gas customer meters (thousands)																		157						150
ENERGY-RELATED BUSINESSES
Sempra Infrastructure
Termoeléctrica de Mexicali (millions of kWhs)						1,064						842						3,086						3,110
Wind and solar (millions of kWhs)(1)						610						640						3,135						2,987

(1)	Includes intercompany sales.
(2)	Several jurisdictions in Sempra California's territory have implemented Community Choice Aggregation, including the City of San Diego in 2022. Additional jurisdictions are in the process of implementing or considering Community Choice Aggregation.
(3)	Includes 100% of the electric deliveries and customer meters of Oncor Electric Delivery Company LLC, in which we hold an indirect 80.25% interest through our investment in Oncor Electric Delivery Holdings Company LLC.

 

SEMPRA
Table F
STATEMENTS OF OPERATIONS DATA BY SEGMENT
(Dollars in millions)
Three months ended December 31, 2023			Sempra California						Sempra Texas Utilities						Sempra Infrastructure						Consolidating Adjustments, Parent & Other									Total
Revenues			$	2,920					$	—					$	586					$	(15)								$	3,491
Cost of sales and other expenses			(1,840)						—						(380)						(14)									(2,234)
Depreciation and amortization			(502)						—						(71)						(3)									(576)
Other income (expense), net			27						—						(1)						30									56
Income (loss) before interest and tax(1)			605						—						134						(2)									737
Net interest (expense) income			(200)						(1)						16						(100)									(285)
Income tax benefit (expense)			95						(1)						(118)						33									9
Equity earnings			—						148						207						40									395
Earnings attributable to noncontrolling interests			—						—						(108)						—									(108)
Preferred dividends			—						—						—						(11)									(11)
Earnings (losses) attributable to common shares			$	500					$	146					$	131					$	(40)								$	737
Three months ended December 31, 2022			Sempra California						Sempra Texas Utilities						Sempra Infrastructure						Consolidating Adjustments, Parent & Other									Total
Revenues			$	3,358					$	—					$	109					$	(12)								$	3,455
Cost of sales and other expenses			(2,158)						(2)						(385)						(28)									(2,573)
Depreciation and amortization			(448)						—						(69)						(2)									(519)
Other income, net			21						—						4						2									27
Income (loss) before interest and tax(1)			773						(2)						(341)						(40)									390
Net interest (expense) income			(175)						—						1						(67)									(241)
Income tax (expense) benefit			(104)						1						(30)						12									(121)
Equity earnings			—						133						247						—									380
Losses attributable to noncontrolling interests			—						—						41						—									41
Preferred dividends			—						—						—						(11)									(11)
Earnings (losses) attributable to common shares			$	494					$	132					$	(82)					$	(106)								$	438

(1)	Management believes Income (Loss) Before Interest and Tax is a useful measurement of our segments' performance because it can be used to evaluate the effectiveness of our operations exclusive of interest and income tax, neither of which is directly relevant to the efficiency of those operations.

 

SEMPRA
Table F (Continued)
STATEMENTS OF OPERATIONS DATA BY SEGMENT
(Dollars in millions)
Year ended December 31, 2023(1)			Sempra California						Sempra Texas Utilities						Sempra Infrastructure						Consolidating Adjustments, Parent & Other									Total
Revenues			$	13,761					$	—					$	3,071					$	(112)								$	16,720
Cost of sales and other expenses			(9,442)						(5)						(1,361)						31									(10,777)
Depreciation and amortization			(1,937)						—						(281)						(9)									(2,227)
Other income, net			93						—						10						28									131
Income (loss) before interest and tax(2)			2,475						(5)						1,439						(62)									3,847
Net interest expense			(758)						(1)						(86)						(375)									(1,220)
Income tax benefit (expense)			31						(1)						(673)						153									(490)
Equity earnings			—						701						740						40									1,481
Earnings attributable to noncontrolling interests			—						—						(543)						—									(543)
Preferred dividends			(1)						—						—						(44)									(45)
Earnings (losses) attributable to common shares			$	1,747					$	694					$	877					$	(288)								$	3,030
Year ended December 31, 2022(1)			Sempra California						Sempra Texas Utilities						Sempra Infrastructure						Consolidating Adjustments, Parent & Other									Total
Revenues			$	12,577					$	—					$	1,919					$	(57)								$	14,439
Cost of sales and other expenses			(8,188)						(6)						(1,642)						(27)									(9,863)
Aliso Canyon litigation and regulatory matters			(259)						—						—						—									(259)
Depreciation and amortization			(1,743)						—						(268)						(8)									(2,019)
Other income (expense), net			84						—						—						(60)									24
Income (loss) before interest and tax(2)			2,471						(6)						9						(152)									2,322
Net interest expense			(636)						—						(60)						(283)									(979)
Income tax (expense) benefit			(320)						—						(249)						13									(556)
Equity earnings			—						742						756						—									1,498
Earnings attributable to noncontrolling interests			—						—						(146)						—									(146)
Preferred dividends			(1)						—						—						(44)									(45)
Earnings (losses) attributable to common shares			$	1,514					$	736					$	310					$	(466)								$	2,094

(1)	Derived from audited financial statements.
(2)	Management believes Income (Loss) Before Interest and Tax is a useful measurement of our segments' performance because it can be used to evaluate the effectiveness of our operations exclusive of interest and income tax, neither of which is directly relevant to the efficiency of those operations.

 

 

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FAQ

What were Sempra's full-year 2023 GAAP earnings and EPS?

Sempra reported full-year 2023 GAAP earnings of $3.03 billion or $4.79 per diluted share.

What is the increase in Sempra's capital plan and the focus of investments?

Sempra announced a 20% increase in its capital plan to $48 billion, with over 90% of investments focused on Sempra California and Sempra Texas.

What is Sempra's projected long-term EPS growth rate?

Sempra affirms a 6-8% projected long-term EPS growth rate.

What is the new common stock dividend declared by Sempra?

Sempra declared a $0.62 per share quarterly dividend on the company's common stock, representing an increase to $2.48 per share on an annualized basis.

When will Sempra's common stock dividend be payable?

The common stock dividend will be payable on April 15, 2024, to common stock shareholders of record at the close of business on March 21, 2024.

Where can investors access the internet broadcast of Sempra's earnings results discussion?

Investors can access the webcast on the Investors section of Sempra's website at sempra.com/investors.