2015 Statistical Report Unaudited Supplement to the Financial Report

Transcription

1 2015 Statistical Report Unaudited Supplement to the Financial Report

2 2015 Statistical Report Unaudited Supplement to the 2015 Financial Report Sempra Energy is a San Diego-based Fortune 500 energy services holding company with 2015 revenues of more than $10 billion. The Sempra Energy companies approximately 17,000 employees serve more than 32 million consumers worldwide. The company develops energy infrastructure, operates utilities and provides energy-related services to customers around the world. Sempra Energy common shares trade on the New York Stock Exchange (NYSE) under the symbol SRE. Additional information is available on the web at Shareholder Services Investors with general questions regarding Sempra Energy, San Diego Gas & Electric Company or Southern California Gas Company securities should contact the company at: Sempra Energy Shareholder Services 488 8th Avenue San Diego, CA Telephone: (877) Fax: (619) investor@sempra.com Internet: Investor Relations Security analysts, portfolio managers and other members of the financial community should contact: Kendall Helm Director - Investor Relations Telephone: Sempra Energy Common Stock: Ticker Symbol: SRE New York Stock Exchange Southern California Gas Co. Preferred Stock: SoCalGas preferred stock is not listed on any exchange and trades over-the-counter.

3 Table of Contents Sempra Energy Selected Financial Data Consolidated Statements of Operations... 3 Consolidated Balance Sheets... 4 Consolidated Statements of Cash Flows... 6 Consolidated Statements of Comprehensive Income (Loss) and Changes in Equity... 8 Segment Earnings and Capital Expenditures and Investments Schedule of Capitalization Schedule of Coverage Ratios and Common Stock Schedule of Long-Term Debt Reconciliation of Sempra Energy Earnings to Sempra Energy Adjusted Earnings San Diego Gas & Electric Company (SDG&E ) Selected Financial Data and Comparative Statistics Consolidated Statements of Operations Consolidated Balance Sheets Consolidated Statements of Cash Flows Southern California Gas Company (SoCalGas ) Selected Financial Data and Comparative Statistics Consolidated Statements of Operations Consolidated Balance Sheets Consolidated Statements of Cash Flows Sempra International Selected Financial Data and Comparative Statistics Sempra South American Utilities Consolidated Statements of Operations Consolidated Balance Sheets Consolidated Statements of Cash Flows Sempra Mexico Consolidated Statements of Operations Consolidated Balance Sheets Consolidated Statements of Cash Flows Sempra U.S. Gas & Power Selected Financial Data and Comparative Statistics Sempra Renewables Consolidated Statements of Operations Consolidated Balance Sheets Consolidated Statements of Cash Flows Sempra Natural Gas Consolidated Statements of Operations Consolidated Balance Sheets Consolidated Statements of Cash Flows Shareholder Information and Research Coverage... 43

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5 Selected Financial Data At December 31 or for the years then ended (In millions, except per share amounts) Revenues Utilities: Electric $ 5,158 $ 5,209 $ 4,911 Natural gas 4,096 4,549 4,398 Energy-related businesses 977 1,277 1,248 Total revenues $ 10,231 $ 11,035 $ 10,557 Income from continuing operations Earnings from continuing operations attributable to noncontrolling interests Call premium on preferred stock of subsidiary Preferred dividends of subsidiaries Earnings/Income from continuing operations attributable to common shares Attributable to common shares: Earnings/Income from continuing operations Basic Diluted Adjusted earnings (1) Adjusted earnings per share, diluted (1) Weighted-average number of common shares outstanding (diluted, in millions) Dividends declared per common share Return on common equity Effective income tax rate Price range of common shares At December 31, Total assets (2) Long-term debt (excludes current portion) (2)(3) Short-term debt (4) Sempra Energy shareholders' equity Common shares outstanding Book value per common share $ 1,448 $ 1,262 $ 1,088 (98) (100) (79) (3) (1) (1) (5) $ 1,349 $ 1,161 $ 1,001 $ 5.43 $ 4.72 $ 4.10 $ 5.37 $ 4.63 $ 4.01 $ 1,308 $ 1,182 $ 1,043 $ 5.21 $ 4.71 $ $ 2.80 $ 2.64 $ % 10.4% 9.4% 20% 20% 26% $ $ $ $ 41,150 $ 39,651 $ 37,165 $ 13,134 $ 12,086 $ 11,174 $ 1,529 $ 2,202 $ 1,692 $ 11,809 $ 11,326 $ 11, $ $ $ (1) Please refer to page 15 for an explanation of these non-gaap measures. (2) As adjusted for the retrospective adoption of Accounting Standards Update , "Interest Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs." (3) Includes capital lease obligations. (4) Includes long-term debt due within one year and current portion of capital lease obligations. 2

6 Consolidated Statements of Operations Years ended December 31, (Dollars in millions, except per share amounts) Revenues Utilities $ 9,254 $ 9,758 $ 9,309 Energy-related businesses 977 1,277 1,248 Total revenues 10,231 11,035 10,557 Expenses and Other Income Utilities: Cost of natural gas (1,134) (1,758) (1,646) Cost of electric fuel and purchased power (2,136) (2,281) (1,932) Energy-related businesses: Cost of natural gas, electric fuel and purchased power (335) (552) (435) Other cost of sales (148) (163) (178) Operation and maintenance (2,895) (2,935) (2,995) Depreciation and amortization (1,250) (1,156) (1,113) Franchise fees and other taxes (423) (408) (374) Plant closure adjustment (loss) 26 (6) (200) Gain on sale of equity interests and assets Equity earnings, before income tax Other income, net Interest income Interest expense (561) (554) (559) Income before income taxes and equity earnings of certain unconsolidated subsidiaries 1,704 1,524 1,430 Income tax expense Equity earnings, net of income tax Net income Earnings attributable to noncontrolling interests Call premium on preferred stock of subsidiary Preferred dividends of subsidiaries Earnings (341) (300) (366) ,448 1,262 1,088 (98) (100) (79) (3) (1) (1) (5) $ 1,349 $ 1,161 $ 1,001 Basic earnings per common share Weighted-average number of shares outstanding, basic (thousands) Diluted earnings per common share Weighted-average number of shares outstanding, diluted (thousands) Dividends declared per share of common stock $ 5.43 $ 4.72 $ , , ,863 $ 5.37 $ 4.63 $ , , ,332 $ 2.80 $ 2.64 $

7 Consolidated Balance Sheets December 31, Assets Current assets: (1) 2013 (1) Cash and cash equivalents $ 403 $ 570 $ 904 Restricted cash Trade accounts receivable, net 1,283 1,242 1,308 Other accounts receivable, net Due from unconsolidated affiliates Income taxes receivable Deferred income taxes Inventories Regulatory balancing accounts undercollected Fixed-price contracts and other derivatives Assets held for sale, power plant 293 Other Total current assets 2,891 4,184 3,997 Investments and other assets: Restricted cash Due from unconsolidated affiliates Deferred taxes recoverable in rates 1,277 1, Regulatory assets arising from pension and other postretirement benefit plan obligations Regulatory assets arising from wildfire litigation costs Regulatory asset arising from plant closure Regulatory balancing accounts undercollected Other regulatory assets Nuclear decommissioning trusts 1,063 1,131 1,034 Investments 2,905 2,848 1,575 Goodwill ,024 Other intangible assets Dedicated assets in support of certain benefit plans Insurance receivable for Aliso Canyon costs 325 Sundry Total investments and other assets 10,220 9,565 7,708 Property, plant and equipment: Property, plant and equipment 38,200 35,407 34,407 Less accumulated depreciation and amortization (10,161) (9,505) (8,947) Property, plant and equipment, net 28,039 25,902 25,460 Total assets $ 41,150 $ 39,651 $ 37,165 (1) As adjusted for the retrospective adoption of Accounting Standards Update , "Interest Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs". 4

8 Consolidated Balance Sheets (continued) December 31, Liabilities and Equity Current liabilities: (1) 2013 (1) Short-term debt $ 622 $ 1,733 $ 545 Accounts payable trade 1,133 1,198 1,088 Accounts payable other Due to unconsolidated affiliates 14 2 Dividends and interest payable Accrued compensation and benefits Regulatory balancing accounts overcollected Current portion of long-term debt ,147 Fixed-price contracts and other derivatives Customer deposits Reserve for Aliso Canyon costs 274 Other Total current liabilities 4,612 5,069 4,369 Long-term debt 13,134 12,086 11,174 Deferred credits and other liabilities: Customer advances for construction Pension and other postretirement benefit plan obligations, net of plan assets 1,152 1, Deferred income taxes 3,157 3,003 2,804 Deferred investment tax credits Regulatory liabilities arising from removal obligations 2,793 2,741 2,623 Asset retirement obligations 2,126 2,048 2,084 Fixed-price contracts and other derivatives Deferred credits and other 1,176 1,104 1,169 Total deferred credits and other liabilities 10,825 10,396 9,772 Equity: Preferred stock Common stock 2,621 2,484 2,409 Retained earnings 9,994 9,339 8,827 Accumulated other comprehensive income (loss) (806) (497) (228) Total Sempra Energy shareholders' equity 11,809 11,326 11,008 Preferred stock of subsidiary Other noncontrolling interests Total equity 12,579 12,100 11,850 Total liabilities and equity $ 41,150 $ 39,651 $ 37,165 (1) As adjusted for the retrospective adoption of Accounting Standards Update , "Interest Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs." 5

9 Consolidated Statements of Cash Flows Years ended December 31, Cash Flows from Operating Activities Net income Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization Deferred income taxes and investment tax credits Gain on sale of equity interests and assets Plant closure (adjustment) loss Equity earnings Fixed-price contracts and other derivatives Other Net change in other working capital components Insurance receivable for Aliso Canyon costs Changes in other assets Changes in other liabilities Net cash provided by operating activities Cash Flows from Investing Activities Expenditures for property, plant and equipment Expenditures for investments and acquisition of businesses Proceeds from sale of equity interests and assets, net of cash sold Proceeds from U.S. Treasury grants Distributions from investments Proceeds from sales by nuclear decommissioning and other trusts Purchases of nuclear decommissioning and other trust assets Increases in restricted cash Decreases in restricted cash Advances to unconsolidated affiliates Repayments of advances to unconsolidated affiliates Other Net cash used in investing activities Cash Flows from Financing Activities Common dividends paid Redemption of preferred stock of subsidiary Preferred dividends paid by subsidiaries Issuances of common stock Repurchases of common stock Issuances of debt (maturities greater than 90 days) Payments on debt (maturities greater than 90 days) Proceeds from sale of noncontrolling interests, net of $25 in offering costs (Decrease) increase in short-term debt, net Purchase of noncontrolling interests Net distributions to noncontrolling interests Tax benefit related to share-based compensation Other Net cash (used in) provided by financing activities Effect of exchange rate changes on cash and cash equivalents (Decrease) increase in cash and cash equivalents Cash and cash equivalents, January 1 Cash and cash equivalents, December 31 6 $ 1,448 $ 1,262 $ 1,088 1,250 1,156 1, (70) (62) (114) (26) (189) (119) (55) (10) (25) (21) (375) (620) (325) (162) 19 (171) (24) ,905 2,161 1,784 (3,156) (3,123) (2,572) (200) (240) (22) (531) (613) (697) (100) (152) (356) (31) (185) (14) (12) (2,885) (3,342) (1,689) (628) (598) (606) (82) (1) (1) (5) (74) (38) (45) 2,992 3,272 2,081 (1,854) (2,034) (1,788) 574 (622) (74) (73) (104) (69) 52 (17) (37) (40) (173) (14) (7) (4) (167) (334) $ 403 $ 570 $ 904

10 Consolidated Statements of Cash Flows (continued) Years ended December 31, Changes in Other Working Capital Components (Excluding cash and cash equivalents, and debt due within one year) Accounts receivable Income taxes receivable, net Inventories Regulatory balancing accounts Regulatory assets and liabilities Other current assets Accounts payable Reserve for Aliso Canyon costs Other current liabilities Net change in other working capital components Supplemental Disclosure of Cash Flow Information Interest payments, net of amounts capitalized Income tax payments, net of refunds $ (99) $ 44 $ (273) (38) 65 (133) (317) (198) (4) 8 1 (18) (10) 15 (157) 109 (28) (138) (215) $ 699 $ (375) $ (620) $ 537 $ 536 $

11 Consolidated Statements of Comprehensive Income (Loss) and Changes in Equity Balance at December 31, 2012 Net income Other comprehensive income (loss): Foreign currency translation adjustments Financial instruments Pension and other postretirement benefits Comprehensive income Share-based compensation expense Common stock dividends declared Preferred dividends of subsidiaries Issuances of common stock Repurchases of common stock Sale of noncontrolling interests, net of offering costs Distributions to noncontrolling interests Call premium on preferred stock of subsidiary Balance at December 31, 2013 Net income Other comprehensive income (loss): Foreign currency translation adjustments Financial instruments Pension and other postretirement benefits Comprehensive income Share-based compensation expense Common stock dividends declared Preferred dividends of subsidiary Issuances of common stock Repurchases of common stock Distributions to noncontrolling interests Equity contributed by noncontrolling interests Purchase of noncontrolling interests in subsidiary Balance at December 31, 2014 Years ended December 31, 2015, 2014 and 2013 Accumulated Sempra other Energy Non- Common Retained comprehensive shareholders' controlling Total stock earnings income (loss) equity interests equity $ 2,217 $ 8,441 $ (376) $ 10,282 $ 401 $ 10,683 1,009 1, , (27) , , (615) (615) (615) (5) (5) (5) (45) (45) (45) (69) (69) (3) (3) (3) 2,409 8,827 (228) 11, ,850 1,162 1, ,262 (193) (193) (20) (213) (64) (64) (1) (65) (12) (12) (12) (269) (649) (649) (649) (1) (1) (1) (38) (38) (38) (107) (107) 1 1 (32) (32) (41) (73) $ 2,484 $ 9,339 $ (497) $ 11,326 $ 774 $ 12,100 8

12 Consolidated Statements of Comprehensive Income (Loss) and Changes in Equity (continued) Balance at December 31, 2014 Net income Other comprehensive income (loss): Foreign currency translation adjustments Financial instruments Pension and other postretirement benefits Comprehensive income Share-based compensation expense Common stock dividends declared Preferred dividends of subsidiary Issuances of common stock Repurchases of common stock Tax benefit related to share-based compensation Distributions to noncontrolling interests Equity contributed by noncontrolling interests Balance at December 31, 2015 Years ended December 31, 2015, 2014 and 2013 Accumulated Sempra other Energy Non- Common Retained comprehensive shareholders' controlling Total stock earnings income (loss) equity interests equity $ 2,484 $ 9,339 $ (497) $ 11,326 $ 774 $ 12,100 1,350 1, ,448 (260) (260) (30) (290) (47) (47) 5 (42) (2) (2) (2) (309) 1, , (694) (694) (694) (1) (1) (1) (74) (74) (74) (80) (80) 3 3 $ 2,621 $ 9,994 $ (806) $ 11,809 $ 770 $ 12,579 9

13 Segment Earnings and Capital Expenditures and Investments Years ended December 31, Earnings (Losses) California Utilities: San Diego Gas & Electric (1) $ 587 $ 507 $ 404 Southern California Gas (2) Sempra International: Sempra South American Utilities Sempra Mexico Sempra U.S. Gas & Power: Sempra Renewables Sempra Natural Gas Parent and Other (152) (173) (168) Earnings $ 1,349 $ 1,161 $ 1,001 Capital Expenditures and Investments California Utilities: San Diego Gas & Electric $ 1,133 $ 1,100 $ 978 Southern California Gas 1,352 1, Sempra International: Sempra South American Utilities Sempra Mexico Sempra U.S. Gas & Power: Sempra Renewables Sempra Natural Gas Parent and Other Consolidated Capital Expenditures and Investments $ 3,356 $ 3,363 $ 2,594 (1) For 2013, amount is after preferred dividends and call premium on preferred stock. (2) After preferred dividends. 10

14 Schedule of Capitalization December 31, Capitalization Short-term debt $ % $ 1, % $ % Current portion of long-term debt , Long-term debt 13, , , Total debt 14, , , Equity: Common stock 2, , , Retained earnings 9, , , Accumulated other comprehensive income (loss) (806) (3.0) (497) (1.9) (228) (0.9) Total Sempra Energy shareholders' equity 11, , , Preferred stock of subsidiary Other noncontrolling interests Total equity 12, , , Total capitalization $ 27, % $ 26, % $ 24, % 11

15 Schedule of Coverage Ratios and Common Stock Years ended December 31, Interest coverage ratios (1) Before income taxes After income taxes Market price of common stock High $ $ $ Low $ $ $ Close $ $ $ Dividends declared per common share $ 2.80 $ 2.64 $ 2.52 Dividend yield on common stock (at December 31) 3.0% 2.4% 2.8% Dividend payout ratio (diluted) 52.1% 57.0% 62.8% Book value at December 31 $ $ $ Return on common equity 11.7% 10.4% 9.4% Ratio of market price to book value per share at December Common shares outstanding at December 31 (millions) Weighted average number of shares outstanding (diluted, in millions) Average daily trading volume (shares) 1,171,375 1,116,535 1,057,314 Common shareholders at December 31 (estimate) 210, , ,000 (1) Excludes interest expense. 12

16 Schedule of Long-Term Debt Outstanding at 12/31/15 Redemption prices (at 12/31/15 unless otherwise noted) SDG&E First mortgage bonds (secured by plant assets): Bonds at variable rates (0.68% at December 31, 2015) March 9, 2017 $ % July 1, 2018 (1) % 3% August 15, % payable 2015 through February % September 1, % June 1, % payable 2015 through December 2027 (1) % 5.875% January and February 2034 (1) % at 06/01/ % May 15, % September 15, % May 1, 2039 (1) % at 09/13/17 6% June 1, % May 15, % August 15, % November 15, % April 1, Other long-term debt: % OMEC LLC loan payable 2013 through April 2019 (secured by OMEC plant assets) 315 Capital lease obligations: Purchased-power agreements 243 Other 1 SoCalGas First mortgage bonds (secured by plant assets): 5.45% April 15, % June 15, % September 15, % June 15, % November 15, % November 15, % September 15, % March 15, Other long-term debt (unsecured): 4.75% Notes May 14, 2016 (1) 8 100% (2) at 05/14/ % Notes January 18, Capital lease obligations 1 Sempra Energy Other long-term debt (unsecured): 6.5% Notes June 1, 2016, including $300 at variable rates after fixed-to-floating rate swaps effective January 2011 (4.77% at December 31, 2015) % Notes April 1, % Notes June 15, % Notes February 15, % Notes March 15, % Notes November 15, % Notes October 1, % Notes December 1, % Notes June 15, % Notes November 15, % Notes October 15, Market value adjustments for interest rate swaps, net (2) Build-to-suit lease

17 Schedule of Long-Term Debt (continued) Outstanding at 12/31/15 Redemption prices (at 12/31/15 unless otherwise noted) Sempra South American Utilities (3) Other long-term debt (unsecured): Chilquinta Energía 4.25% Series B Bonds payable 2014 through October 30, 2030 (1) % Luz del Sur Bank loans 5.05% to 6.7% payable 2016 through December Notes at 4.75% to 8.75% payable 2014 through September Other bonds at 3.77% to 4.61% payable 2020 through May Capital lease 6 Sempra Mexico (3) Other long-term debt (unsecured): Notes February 8, 2018 at variable rates (2.66% after floating-to-fixed rate cross-currency swaps effective February 2013) % Notes February 2, 2023 (4.12% after cross-currency swap) 227 Sempra Renewables Other long-term debt (secured by project assets): Loan at variable rates (2.24% at December 31, 2015) payable 2012 through December 2028, except for $69 at 4.54% after floating-to-fixed rate swaps effective June 2012 (1) % Sempra Natural Gas First mortgage bonds (Mobile Gas, secured by plant assets): 4.14% September 30, % September 30, Other long-term debt (unsecured unless otherwise noted): Notes at 2.87% to 3.51% October 1, 2016 (1) % 8.45% Notes payable 2012 through December 2017 (secured by parent guarantee) % Notes December 30, 2018 (secured by plant assets) (1) % Total long-term debt outstanding Current portion of long-term debt Unamortized discount on long-term debt Unamortized premium on long-term debt Unamortized debt issuance costs 14,148 (907) (27) 5 (85) Total $ 13,134 (1) (2) (3) Callable long-term debt not subject to make-whole provisions. Denominated in Swiss Francs. Redemption price varies based on exchange rate. Amounts at December 31, 2015 include foreign currency fluctuations. At the option of Sempra Energy, SDG&E and SoCalGas, $810 million of debt is callable subject to premiums at various dates: $34 million in 2016, $7 million in 2017, $173 million in 2018, $7 million in 2019, $7 million in 2020 and $582 million thereafter. In addition, $12.6 billion of bonds are callable subject to make-whole provisions, and the OMEC LLC project financing loan may be prepaid at the borrower's option. Excluding capital lease obligations, build-to-suit lease and market value adjustments for interest rate swaps, maturities of long-term debt are $897 million in 2016, $854 million in 2017, $1.4 billion in 2018, $854 million in 2019, $968 million in 2020 and $8.8 billion thereafter. 14

18 Reconciliation of Sempra Energy Earnings to Sempra Energy Adjusted Earnings Sempra Energy Adjusted Earnings and Adjusted Earnings Per Share exclude the following: in 2015, a $36 million gain on the sale of the remaining block of the Mesquite Power plant and $10 million of liquefied natural gas (LNG) liquefaction development expenses; and in 2013, $77 million retroactive impact of the 2012 General Rate Case (GRC) for the full-year Sempra Energy Adjusted Earnings and Adjusted Earnings Per Share also exclude the following amounts related to San Diego Gas & Electric Company s (SDG&E) San Onofre Nuclear Generating Station (SONGS): in 2013, a $119 million plant closure loss from the early retirement of SONGS; in 2014, a $21 million charge to adjust the total plant closure loss; and in 2015, a $15 million reduction to the total plant closure loss, primarily due to the California Public Utilities Commission approval of SDG&E s compliance filing for authorized recovery of its investment in SONGS. Sempra Energy Adjusted Earnings and Adjusted Earnings Per Share are non-gaap financial measures (GAAP represents accounting principles generally accepted in the United States of America). Because of the significance and nature of these items, management believes that these non-gaap financial measures provide a more meaningful comparison of the performance of Sempra Energy s business operations from 2015 to prior and future periods. Non-GAAP financial measures are supplementary information that should be considered in addition to, but not as a substitute for, the information prepared in accordance with GAAP. The table below reconciles for historical periods these non-gaap financial measures to Sempra Energy Earnings and Diluted Earnings Per Common Share, which we consider to be the most directly comparable financial measures calculated in accordance with GAAP. Years ended December 31, (Dollars in millions, except per share amounts) Sempra Energy Earnings (GAAP) $ 1,349 $ 1,161 $ 1,001 Exclude: Gain on sale of Mesquite Power block 2 (36) Plant closure (adjustment) loss (15) LNG liquefaction development expenses 10 Retroactive impact of 2012 GRC for full-year 2012 (77) Sempra Energy Adjusted Earnings $ 1,308 $ 1,182 $ 1,043 Diluted earnings per common share: Sempra Energy Earnings (GAAP) $ 5.37 $ 4.63 $ 4.01 Sempra Energy Adjusted Earnings $ 5.21 $ 4.71 $ 4.18 Weighted-average number of shares outstanding, diluted (thousands) 250, , ,332 15

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20 Selected Financial Data and Comparative Statistics Years ended December 31, Net income (before preferred dividends and call premium on preferred stock, and including earnings attributable to noncontrolling interest) $ 606 $ 527 $ 435 Earnings attributable to common shares $ 587 $ 507 $ 404 Common dividends to parent $ 300 $ 200 $ Capital expenditures $ 1,133 $ 1,100 $ 978 Weighted average rate base $ 7,671 $ 7,253 $ 7,244 Authorized rate of return on: Rate base 7.79% 7.79% 7.79% Common equity 10.30% 10.30% 10.30% Achieved return on common equity 11.56% 10.61% 9.13% Electric revenues Residential $ 1,486 $ 1,370 $ 1,283 Commercial 1,508 1,418 1,080 Industrial Other Electric revenues in rates 3,619 3,350 2,783 CAISO shared transmission revenue - net (1) Other revenues Balancing accounts (405) Total electric revenues $ 3,719 $ 3,785 $ 3,537 Electric volumes (millions of kwhs) Residential 7,143 7,338 7,392 Commercial 6,877 6,974 6,722 Industrial 2,161 2,067 1,962 Other 3,735 3,736 3,680 Total 19,916 20,115 19,756 Cooling degree days 1,722 1, Electric customers at December 31, Residential 1,268,684 1,259,784 1,252,434 Commercial 150, , ,039 Industrial Other 7,117 7,313 7,478 Total number of electric customers 1,426,368 1,416,612 1,408,404 (1) California Independent System Operator (CAISO) shared transmission revenue changes are primarily due to timing differences offset by corresponding changes in balancing accounts. 17

21 Selected Financial Data and Comparative Statistics (continued) Years ended December 31, (Dollars in millions, except average cost of natural gas) Natural gas revenues Residential $ 297 $ 306 $ 324 Commercial and industrial Electric generation plants Natural gas revenues in rates Other revenues Balancing accounts Total natural gas revenues $ 500 $ 544 $ 529 Natural gas volumes delivered (billion cubic feet) Residential Commercial and industrial Electric generation plants Total Core Noncore Total Average cost of natural gas (per thousand cubic feet) $ 4.05 $ 5.44 $ 4.49 Heating degree days ,334 Natural gas customers at December 31, Residential 839, , ,793 Commercial 28,530 28,613 28,618 Off-system sales and transportation 4,736 12,923 3,746 Total number of natural gas customers 872, , ,157 18

22 Consolidated Statements of Operations Years ended December 31, Operating revenues Electric $ 3,719 $ 3,785 $ 3,537 Natural gas Total operating revenues 4,219 4,329 4,066 Operating expenses Cost of electric fuel and purchased power 1,151 1,309 1,019 Cost of natural gas Operation and maintenance 1,017 1,076 1,157 Depreciation and amortization Franchise fees and other taxes Plant closure (adjustment) loss (26) Total operating expenses 3,161 3,370 3,284 Operating income 1, Other income (expense), net Allowance for equity funds used during construction Regulatory interest income, net Sundry, net (4) (3) (3) Total other income, net Interest income Interest expense Income before income taxes Income tax expense Net income Earnings attributable to noncontrolling interest Earnings Call premium on preferred stock Preferred dividend requirements Earnings attributable to common shares 1 (204) (202) (197) (284) (270) (191) (19) (20) (24) (3) (4) $ 587 $ 507 $

23 Consolidated Balance Sheets December 31, Assets Current assets: (1) 2013 (1) Cash and cash equivalents $ 20 $ 8 $ 27 Restricted cash Accounts receivable - trade, net Accounts receivable - other, net Due from unconsolidated affiliates Income taxes receivable 32 Deferred income taxes 103 Inventories Regulatory balancing accounts - net undercollected Regulatory assets Fixed-price contracts and other derivatives Other Total current assets 1,004 1,344 1,270 Other assets: Restricted cash Deferred taxes recoverable in rates Regulatory assets arising from pension and other postretirement benefit obligations Regulatory assets arising from wildfire litigation costs Regulatory assets arising from plant closure Regulatory balancing accounts - undercollected 161 Other regulatory assets Nuclear decommissioning trusts 1,063 1,131 1,034 Sundry Total other assets 3,255 3,298 3,221 Property, plant and equipment: Property, plant and equipment 16,458 15,478 14,346 Less accumulated depreciation and amortization (4,202) (3,860) (3,500) Property, plant and equipment, net 12,256 11,618 10,846 Total assets $ 16,515 $ 16,260 $ 15,337 (1) As adjusted for the retrospective adoption of Accounting Standards Update , "Interest Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs." 20

24 Consolidated Balance Sheets (continued) Liabilities and Equity Current liabilities: Short-term debt December 31, (1) 2013 (1) $ 168 $ 246 $ 59 Accounts payable Due to unconsolidated affiliates Income taxes payable 30 Deferred income taxes 53 Interest payable Accrued compensation and benefits Accrued franchise fees Current portion of long-term debt Asset retirement obligations Fixed-price contracts and other derivatives Customer deposits Other Total current liabilities 1,207 1,788 1,079 Long-term debt 4,455 4,283 4,485 Deferred credits and other liabilities: Customer advances for construction Pension and other postretirement benefit plan obligations, net of plan assets Deferred income taxes 2,472 2,121 2,021 Deferred investment tax credits Regulatory liabilities arising from removal obligations 1,629 1,557 1,403 Asset retirement obligations Fixed-price contracts and other derivatives Deferred credits and other Total deferred credits and other liabilities 5,577 5,197 5,054 Equity: Common stock (255 million shares authorized, 117 million shares outstanding) 1,338 1,338 1,338 Retained earnings 3,893 3,606 3,299 Accumulated other comprehensive income (loss) (8) (12) (9) Total SDG&E shareholder's equity 5,223 4,932 4,628 Noncontrolling interest Total equity 5,276 4,992 4,719 Total liabilities and equity $ 16,515 $ 16,260 $ 15,337 (1) As adjusted for the retrospective adoption of Accounting Standards Update , "Interest Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs." 21

25 Consolidated Statements of Cash Flows Years ended December 31, Cash Flows from Operating Activities Net income $ 606 $ 527 $ 435 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization Deferred income taxes and investment tax credits Plant closure (adjustment) loss (26) Fixed-price contracts and other derivatives (4) (6) (8) Other (16) (23) (37) Changes in other assets (122) 191 (150) Changes in other liabilities Changes in working capital components: Accounts receivable (10) (47) (40) Due to/from affiliates, net 21 (10) 38 Inventories (2) 4 (14) Other current assets (24) (16) 7 Income taxes 35 (50) Accounts payable (28) (23) 50 Regulatory balancing accounts 474 (208) (140) Interest payable (1) 4 Other current liabilities (16) (104) (260) Net cash provided by operating activities 1,664 1, Cash Flows from Investing Activities Expenditures for property, plant and equipment (1,133) (1,100) (978) Proceeds from sales by nuclear decommissioning trusts Purchases of nuclear decommissioning trust assets (526) (609) (692) Proceeds from sale of assets 11 Increase in restricted cash (39) (84) (81) Decrease in restricted cash Expenditures related to long-term service agreement (30) Net cash used in investing activities (1,086) (1,126) (973) Cash Flows from Financing Activities Common dividends paid (300) (200) Redemption of preferred stock (82) Preferred dividends paid (5) Issuances of debt (maturities greater than 90 days) Payments on debt (maturities greater than 90 days) (547) (24) (199) (Decrease) increase in short-term debt, net (131) Capital distributions made by Otay Mesa VIE (30) (53) (26) Other (2) (3) Net cash (used in) provided by financing activities (566) Increase (decrease) in cash and cash equivalents 12 (19) (60) Cash and cash equivalents, January Cash and cash equivalents, December 31 $ 20 $ 8 $ 27 Supplemental Disclosure of Cash Flow Information Interest payments, net of amounts capitalized $ 199 $ 196 $ 187 Income tax payments (refunds), net 88 (4) 84 22

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27 Selected Financial Data and Comparative Statistics Years ended December 31, (Dollars in millions, except average cost of natural gas) Net income (before preferred dividends) $ 420 $ 333 $ 365 Earnings attributable to common shares $ 419 $ 332 $ 364 Common dividends to parent $ 50 $ 100 $ 50 Capital expenditures $ 1,352 $ 1,104 $ 762 Weighted average rate base $ 4,269 $ 3,879 $ 3,499 Authorized rate of return on: Rate base 8.02% 8.02% 8.02% Common equity 10.10% 10.10% 10.10% Achieved return on common equity 14.24% 12.56% 15.36% Natural gas revenues Residential $ 2,052 $ 2,186 $ 2,212 Commercial and industrial 893 1, Electric generation plants Wholesale Natural gas revenues in rates 3,013 3,255 3,216 Other revenues Balancing accounts Total operating revenues $ 3,489 $ 3,855 $ 3,736 Natural gas volumes delivered (billion cubic feet) Residential Commercial and industrial Electric generation plants Wholesale Total Core Noncore Total Average cost of natural gas (per thousand cubic feet) $ 3.18 $ 5.06 $ 4.08 Heating degree days ,210 Customers at December 31, Residential 5,621,600 5,594,129 5,568,155 Commercial 252, , ,683 Industrial 26,325 26,685 27,007 Electric generation plants and wholesale Total number of customers 5,900,834 5,867,702 5,841,889 24

28 Consolidated Statements of Operations Years ended December 31, Operating revenues $ 3,489 $ 3,855 $ 3,736 Operating expenses Cost of natural gas 921 1,449 1,362 Operation and maintenance 1,370 1,321 1,324 Depreciation and amortization Franchise fees and other taxes Total operating expenses 2,881 3,334 3,197 Operating income Other income (expense), net Allowance for equity funds used during construction Regulatory interest income, net 1 Sundry, net (6) (6) (7) Total other income, net Interest income Interest expense Income before income taxes Income tax expense Net income Preferred dividend requirements Earnings attributable to common shares 4 (84) (69) (69) (138) (139) (116) (1) (1) (1) $ 419 $ 332 $

29 Consolidated Balance Sheets December 31, Assets Current assets: (1) 2013 (1) Cash and cash equivalents $ 58 $ 85 $ 27 Accounts receivable - trade, net Accounts receivable - other, net Due from unconsolidated affiliates Income taxes receivable 5 25 Inventories Regulatory balancing accounts - net undercollected 35 Regulatory assets Other Total current assets Other assets: Regulatory assets arising from pension obligations Deferred taxes recoverable in rates Other regulatory assets Insurance receivable for Aliso Canyon costs 325 Sundry Total other assets 1,867 1, Property, plant and equipment: Property, plant and equipment 14,171 12,886 11,831 Less accumulated depreciation and amortization (4,900) (4,642) (4,364) Property, plant and equipment, net 9,271 8,244 7,467 Total assets $ 12,104 $ 10,446 $ 9,138 (1) As adjusted for the retrospective adoption of Accounting Standards Update , "Interest Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs." 26

30 Consolidated Balance Sheets (continued) Liabilities and Shareholders' Equity Current liabilities: Short-term debt Accounts payable - trade Accounts payable - other Due to unconsolidated affiliate Income taxes payable Deferred income taxes Accrued compensation and benefits Regulatory balancing accounts - net overcollected Current portion of long-term debt Customer deposits Reserve for Aliso Canyon costs Other Total current liabilities Long-term debt December 31, (1) 2013 (1) $ $ 50 $ ,238 1,089 1,212 2,481 1,891 1,150 Deferred credits and other liabilities: Customer advances for construction Pension obligation, net of plan assets Deferred income taxes 1,532 1, Deferred investment tax credits Regulatory liabilities arising from removal obligations 1,145 1,167 1,205 Asset retirement obligations 1,354 1,255 1,182 Deferred credits and other Total deferred credits and other liabilities 5,236 4,685 4,227 Shareholders' equity: Preferred stock Common stock (100 million shares authorized; 91 million shares outstanding; no par value) Retained earnings 2,280 1,911 1,679 Accumulated other comprehensive income (loss) (19) (18) (18) Total shareholders' equity 3,149 2,781 2,549 Total liabilities and shareholders' equity $ 12,104 $ 10,446 $ 9,138 (1) As adjusted for the retrospective adoption of Accounting Standards Update , "Interest Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs." 27

31 Consolidated Statements of Cash Flows Years ended December 31, Cash Flows from Operating Activities Net income $ 420 $ 333 $ 365 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization Deferred income taxes and investment tax credits Other (11) (7) (5) Insurance receivable for Aliso Canyon costs (325) Changes in other assets (91) (131) (52) Changes in other liabilities (7) 29 (4) Changes in working capital components: Accounts receivable (90) 30 (113) Inventories 102 (113) 82 Other current assets 8 (3) 3 Accounts payable (143) 156 (54) Income taxes Due to/from affiliates, net (11) (1) (57) Regulatory balancing accounts 112 (109) (58) Customer deposits 1 (1) Reserve for Aliso Canyon costs 274 Other current liabilities Net cash provided by operating activities Cash Flows from Investing Activities Expenditures for property, plant and equipment (1,352) (1,104) (762) (Increase) decrease in loans to affiliate, net (50) 34 Net cash used in investing activities (1,402) (1,104) (728) Cash Flows from Financing Activities Common dividends paid (50) (100) (50) Preferred dividends paid (1) (1) (1) Issuances of long-term debt Payments on long-term debt (250) Debt issuance costs (3) (7) (Decrease) increase in short-term debt, net (50) 8 42 Net cash provided by (used in) financing activities (9) (Decrease) increase in cash and cash equivalents (27) 58 (56) Cash and cash equivalents, January Cash and cash equivalents, December 31 $ 58 $ 85 $ 27 Supplemental Disclosure of Cash Flow Information Interest payments, net of amounts capitalized $ 79 $ 62 $ 65 Income tax payments (refunds), net 1 (10) (52) 28

32 Selected Financial Data and Comparative Statistics Earnings Years ended December 31, Sempra South American Utilities (1) $ 175 $ 172 $ 153 Sempra Mexico Total $ 388 $ 364 $ 275 Natural gas distribution operations Volumes delivered (billion cubic feet) Sempra Mexico Customers (in thousands, at December 31) Sempra Mexico Electric distribution operations Volumes (millions of kwhs) Peru 7,549 7,287 6,984 Chile 2,887 2,944 2,856 Total 10,436 10,231 9,840 Customers (in thousands, at December 31) Peru 1,053 1, Chile Total 1,725 1,686 1,636 Power Sold Volumes (millions of kwhs) Sempra Mexico 3,821 4,225 3,752 (1) In 2013, includes $11 million equity losses ($7 million impairment and $4 million loss on sale) associated with Sempra South American Utilities' Argentine investments, which were sold in the second quarter of Sempra International is not the same company as the California utilities, San Diego Gas & Electric (SDG&E) and Southern California Gas Company (SoCalGas), and Sempra International is not regulated by the California Public Utilities Commission. 29

33 Sempra South American Utilities Consolidated Statements of Operations Years ended December 31, Revenues Utilities - electric $ 1,447 $ 1,434 $ 1,383 Energy-related businesses Total revenues 1,544 1,534 1,495 Expenses and other income Utilities: Cost of electric fuel and purchased power (985) (972) (913) Energy-related businesses: Cost of sales (86) (79) (84) Operation and maintenance (160) (173) (170) Depreciation and amortization (50) (55) (59) Other operating income (expense) 1 (2) Other income, net Interest income Interest expense (32) (33) (27) Income before income taxes and equity losses of certain unconsolidated subsidiaries Income tax expense (67) (58) (67) Equity losses, net of income tax (4) (4) (15) Net income Earnings attributable to noncontrolling interests (26) (33) (28) Earnings $ 175 $ 172 $ 153 Sempra South American Utilities is not the same company as the California utilities, San Diego Gas & Electric (SDG&E) and Southern California Gas Company (SoCalGas), and Sempra South American Utilities is not regulated by the California Public Utilities Commission. 30

34 Sempra South American Utilities Consolidated Balance Sheets Assets December 31, Current assets: Cash and cash equivalents $ 233 $ 338 $ 384 Accounts receivable Due from unconsolidated affiliates Deferred income taxes 2 80 Inventories Other Total current assets Due from unconsolidated affiliates Goodwill and other intangible assets Property, plant and equipment, net 1,656 1,744 1,777 Other Total assets $ 3,235 $ 3,379 $ 3,531 Liabilities and Equity Current liabilities: Short-term debt $ 28 $ 24 $ 55 Accounts payable Due to unconsolidated affiliates Income taxes payable Current portion of long-term debt Other Total current liabilities Long-term debt Other noncurrent liabilities: Due to unconsolidated affiliates Deferred income taxes Other liabilities Total other noncurrent liabilities Equity Shareholders' equity 1,856 1,696 1,747 Noncontrolling interests Total equity 2,045 1,900 1,999 Total liabilities and equity $ 3,235 $ 3,379 $ 3,531 Sempra South American Utilities is not the same company as the California utilities, San Diego Gas & Electric (SDG&E) and Southern California Gas Company (SoCalGas), and Sempra South American Utilities is not regulated by the California Public Utilities Commission. 31

35 Sempra South American Utilities Consolidated Statements of Cash Flows Cash Flows from Operating Activities Years ended December 31, Net income $ 201 $ 205 $ 181 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization Deferred income taxes 17 (6) 3 Equity losses Other Changes in other assets (5) (14) (7) Changes in other liabilities 5 Net change in working capital components (44) (35) (31) Net cash provided by operating activities Cash Flows from Investing Activities Expenditures for property, plant and equipment (154) (174) (200) Proceeds from sale of investments 13 (Increase) decrease in loans to affiliates, net (151) (26) 344 Decrease in restricted cash Increase in restricted cash (8) (9) (9) Net cash (used in) provided by investing activities (305) (200) 156 Cash Flows from Financing Activities Dividends paid (75) (13) (222) Capital contributed 99 Issuances of debt (maturities greater than 90 days) Payments on debt (maturities greater than 90 days) (80) (219) (168) Increase in short-term debt, net 12 1 Increase (decrease) in loans from affiliates, net 16 (35) 72 Purchase of noncontrolling interests (74) Distributions to noncontrolling interests (14) (21) (22) Net cash used in financing activities (18) (71) (49) Effect of exchange rate changes on cash and cash equivalents (10) (3) (Decrease) increase in cash and cash equivalents (105) (46) 330 Cash and cash equivalents, January Cash and cash equivalents, December 31 $ 233 $ 338 $ 384 Sempra South American Utilities is not the same company as the California utilities, San Diego Gas & Electric (SDG&E) and Southern California Gas Company (SoCalGas), and Sempra South American Utilities is not regulated by the California Public Utilities Commission. 32

36 Sempra Mexico Consolidated Statements of Operations Revenues Years ended December 31, Utility natural gas $ 81 $ 109 $ 97 Energy-related businesses Total revenues Expenses and other income Utility: Cost of natural gas (49) (74) (63) Energy-related businesses: Cost of natural gas, electric fuel and purchased power (221) (350) (253) Other cost of sales (15) (14) (10) Operation and maintenance (126) (121) (124) Depreciation and amortization (70) (64) (63) Gain on sale of equity interest 19 Other taxes (4) (3) (2) Other income, net Interest income Interest expense (23) (17) (17) Income before income taxes and equity earnings of certain unconsolidated subsidiaries Income tax expense (11) (5) (60) Equity earnings, net of income tax Net income Earnings attributable to noncontrolling interests (1) (53) (47) (26) Earnings attributable to common shares $ 213 $ 192 $ 122 (1) In the first quarter of 2013, Sempra Energy s subsidiary, Infraestructura Energética Nova, S.A.B. de C.V. (IEnova), completed a private offering in the U.S. and outside of Mexico and a concurrent public offering in Mexico of common stock. The aggregate shares of common stock sold in the offerings represent approximately 18.9 percent of IEnova s outstanding ownership interest. IEnova is reported within the Sempra Mexico reportable segment. Sempra Mexico is not the same company as the California utilities, San Diego Gas & Electric (SDG&E) and Southern California Gas Company (SoCalGas), and Sempra Mexico is not regulated by the California Public Utilities Commission. 33

37 Sempra Mexico Consolidated Balance Sheets December 31, Assets Current assets: (1) 2013 (1) Cash and cash equivalents $ 60 $ 114 $ 311 Restricted cash 12 Accounts receivable Due from unconsolidated affiliates Income taxes receivable 6 26 Deferred income taxes 12 Inventories Fixed-price contracts and other derivatives Other Total current assets Restricted cash Investments Goodwill and other intangible assets Due from unconsolidated affiliates Deferred income taxes 89 Fixed-price contracts and other derivatives Property, plant and equipment, net 2,642 2,387 2,218 Other Total assets $ 3,783 $ 3,486 $ 3,243 Liabilities and Equity Current liabilities: Short-term debt $ 91 $ 145 $ Accounts payable Due to unconsolidated affiliates Current portion of long-term debt 51 Income taxes payable 16 Other Total current liabilities Long-term debt Other noncurrent liabilities: Due to unconsolidated affiliates Deferred income taxes Fixed-price contracts and other derivatives Other Total other noncurrent liabilities Equity: Sempra Mexico shareholders' equity 1,934 1,882 1,848 Noncontrolling interests Total equity 2,402 2,334 2,290 Total liabilities and equity $ 3,783 $ 3,486 $ 3,243 (1) As adjusted for the retrospective adoption of Accounting Standards Update , "Interest Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs." Sempra Mexico is not the same company as the California utilities, San Diego Gas & Electric (SDG&E) and Southern California Gas Company (SoCalGas), and Sempra Mexico is not regulated by the California Public Utilities Commission. 34