Sempra’s 2Q earnings fall
California utility Sempra Energy (SRE) released its 2Q16 earnings on August 4, 2016. It reported earnings of $0.79 per share against its earnings of $1.03 per share in 2Q15.
Its earnings fall in the second quarter this year was led by the $19 million after-tax losses compared to $5 million after-tax gains in 2Q15, both resulting from natural gas price movements on inventories sold forward at Sempra U.S. Gas & Power.
Sempra Energy maintained its 2016 earnings guidance of $4.60 to $5.00 per share and 12% long term earnings growth compounded annually through 2020.
Sempra Energy’s California utilities registered earnings fall due to their rate case decisions. San Diego Gas & Electric posted a $31 million after-tax refund to ratepayers from tax repairs deductions.
Southern California Gas reported a $49 million after-tax refund to ratepayers. Southern California Gas increased its estimate of costs related to the Aliso Canyon Gas leak to $717 million. Management is claiming to have an insurance cover of $1 billion, of which it has managed to collect $34 million. Southern California Gas is waiting for regulators’ approval to start instilling gas again into the Aliso Canyon storage field in September 2016.
Sempra Energy’s South American Utility segment posted largely flat earnings in 2Q16 compared to 2Q15.
Sempra Energy’s Renewables segment posted an earnings decline from $19 million in 2Q15 to $12 million in 2Q16. This fall was due to lower investment tax credits from solar projects that came into service than in 2Q15.