GENERAL INFORMATION AND OTHER FINANCIAL DATA (Tables)

3 Months Ended

Mar. 31, 2023

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Cash and Cash Equivalents

The following table provides a reconciliation of cash, cash equivalents and restricted cash reported on Sempra’s Condensed Consolidated Balance Sheets to the sum of such amounts reported on Sempra’s Condensed Consolidated Statements of Cash Flows.

RECONCILIATION OF CASH, CASH EQUIVALENTS AND RESTRICTED CASH
(Dollars in millions)
	March 31, 2023		December 31, 2022
Cash and cash equivalents	$	534	$	370
Restricted cash, current	85		40
Restricted cash, noncurrent	84		52
Total cash, cash equivalents and restricted cash on the Condensed Consolidated Statements of Cash Flows	$	703	$	462

Accounts Receivable, Allowance for Credit Loss Table

We provide below the changes in allowances for credit losses for trade receivables and other receivables. SDG&E and SoCalGas record changes in the allowances for credit losses related to Accounts Receivable – Trade in regulatory accounts.

CHANGES IN ALLOWANCES FOR CREDIT LOSSES
(Dollars in millions)
	2023		2022
Sempra:
Allowances for credit losses at January 1	$	181	$	136
Provisions for expected credit losses	117		48
Write-offs	(20)		(19)
Allowances for credit losses at March 31	$	278	$	165
SDG&E:
Allowances for credit losses at January 1	$	78	$	66
Provisions for expected credit losses	38		21
Write-offs	(11)		(9)
Allowances for credit losses at March 31	$	105	$	78
SoCalGas:
Allowances for credit losses at January 1	$	98	$	69
Provisions for expected credit losses	77		26
Write-offs	(9)		(10)
Allowances for credit losses at March 31	$	166	$	85

Allowances for credit losses related to trade receivables and other receivables are included in the Condensed Consolidated Balance Sheets as follows:

ALLOWANCES FOR CREDIT LOSSES
(Dollars in millions)
	March 31,		December 31,
	2023		2022
Sempra:
Accounts receivable – trade, net	$	238	$	140
Accounts receivable – other, net	40		40
Other long-term assets	—		1
Total allowances for credit losses	$	278	$	181
SDG&E:
Accounts receivable – trade, net	$	80	$	52
Accounts receivable – other, net	25		25
Other long-term assets	—		1
Total allowances for credit losses	$	105	$	78
SoCalGas:
Accounts receivable – trade, net	$	151	$	83
Accounts receivable – other, net	15		15
Total allowances for credit losses	$	166	$	98

Inventory Table

The components of inventories are as follows:

INVENTORY BALANCES
(Dollars in millions)
	Sempra				SDG&E				SoCalGas
	March 31, 2023		December 31, 2022		March 31, 2023		December 31, 2022		March 31, 2023		December 31, 2022
Natural gas	$	41	$	106	$	1	$	1	$	24	$	74
LNG	7		62		—		—		—		—
Materials and supplies	267		235		142		133		106		85
Total	$	315	$	403	$	143	$	134	$	130	$	159

Capitalized Financing Costs Table

The table below summarizes capitalized financing costs, comprised of AFUDC and capitalized interest.

CAPITALIZED FINANCING COSTS
(Dollars in millions)
	Three months ended March 31,
	2023		2022
Sempra	$	73	$	57
SDG&E	31		28
SoCalGas	15		18

Net Periodic Benefit Cost Table

The following tables provide the components of net periodic benefit cost. The components of net periodic benefit cost, other than the service cost component, are included in the Other Income, Net, table below.

NET PERIODIC BENEFIT COST – SEMPRA
(Dollars in millions)
	Pension				PBOP
	Three months ended March 31,
	2023		2022		2023		2022
Service cost	$	28	$	41	$	4	$	7
Interest cost	40		30		9		7
Expected return on assets	(43)		(46)		(17)		(16)
Amortization of:
Prior service cost (credit)	1		3		(1)		(1)
Actuarial loss (gain)	2		6		(6)		(4)
Net periodic benefit cost (credit)	28		34		(11)		(7)
Regulatory adjustments	29		(27)		11		7
Total expense recognized	$	57	$	7	$	—	$	—

NET PERIODIC BENEFIT COST – SDG&E
(Dollars in millions)
	Pension				PBOP
	Three months ended March 31,
	2023		2022		2023		2022
Service cost	$	8	$	10	$	1	$	2
Interest cost	10		7		2		1
Expected return on assets	(10)		(11)		(2)		(2)
Amortization of:
Actuarial loss (gain)	1		—		(1)		(1)
Net periodic benefit cost	9		6		—		—
Regulatory adjustments	4		(5)		—		—
Total expense recognized	$	13	$	1	$	—	$	—

NET PERIODIC BENEFIT COST – SOCALGAS
(Dollars in millions)
	Pension				PBOP
	Three months ended March 31,
	2023		2022		2023		2022
Service cost	$	17	$	28	$	3	$	5
Interest cost	25		20		7		5
Expected return on assets	(29)		(31)		(15)		(13)
Amortization of:
Prior service cost (credit)	1		2		(1)		(1)
Actuarial loss (gain)	—		4		(5)		(3)
Net periodic benefit cost (credit)	14		23		(11)		(7)
Regulatory adjustments	25		(22)		11		7
Total expense recognized	$	39	$	1	$	—	$	—

Earnings Per Share Computations Table

Basic EPS is calculated by dividing earnings attributable to common shares by the weighted-average number of common shares outstanding for the period. Diluted EPS includes the potential dilution of common stock equivalent shares that could occur if securities or other contracts to issue common stock were exercised or converted into common stock.

EARNINGS PER COMMON SHARE COMPUTATIONS
(Dollars in millions, except per share amounts; shares in thousands)
	Three months ended March 31,
	2023		2022
Numerator:
Earnings attributable to common shares	$	969	$	612
Denominator:
Weighted-average common shares outstanding for basic EPS(1)	314,919		316,353
Dilutive effect of stock options and RSUs(2)	1,205		1,081
Weighted-average common shares outstanding for diluted EPS	316,124		317,434
EPS:
Basic	$	3.08	$	1.93
Diluted	$	3.07	$	1.93

(1)    Includes 360 and 407 fully vested RSUs held in our Deferred Compensation Plan for the three months ended March 31, 2023 and 2022, respectively. These fully vested RSUs are included in weighted-average common shares outstanding for basic EPS because there are no conditions under which the corresponding shares will not be issued.

(2)    Due to market fluctuations of both Sempra common stock and the comparative indices used to determine the vesting percentage of our total shareholder return performance-based RSUs, which we discuss in Note 10 of the Notes to Consolidated Financial Statements in the Annual Report, dilutive RSUs may vary widely from period-to-period.

Schedule of Accumulated Other Comprehensive Income (Loss) Table

The following tables present the changes in AOCI by component and amounts reclassified out of AOCI to net income, excluding amounts attributable to NCI.

CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) BY COMPONENT(1)
(Dollars in millions)
	Foreign currency translation adjustments		Financial instruments		Pension and PBOP		Total accumulated other comprehensive income (loss)
	Three months ended March 31, 2023 and 2022
Sempra:
Balance at December 31, 2022	$	(59)	$	10	$	(86)	$	(135)
OCI before reclassifications	10		(40)		(13)		(43)
Amounts reclassified from AOCI	—		(5)		1		(4)
Net OCI	10		(45)		(12)		(47)
Balance at March 31, 2023	$	(49)	$	(35)	$	(98)	$	(182)
Balance at December 31, 2021	$	(79)	$	(156)	$	(83)	$	(318)
OCI before reclassifications	3		74		6		83
Amounts reclassified from AOCI	—		4		2		6
Net OCI	3		78		8		89
Balance at March 31, 2022	$	(76)	$	(78)	$	(75)	$	(229)
SDG&E:
Balance at December 31, 2022 and March 31, 2023					$	(7)	$	(7)
Balance at December 31, 2021 and March 31, 2022					$	(10)	$	(10)
SoCalGas:
Balance at December 31, 2022			$	(12)	$	(12)	$	(24)
Amounts reclassified from AOCI			—		1		1
Net OCI			—		1		1
Balance at March 31, 2023			$	(12)	$	(11)	$	(23)
Balance at December 31, 2021			$	(13)	$	(18)	$	(31)
Amounts reclassified from AOCI			—		1		1
Net OCI			—		1		1
Balance at March 31, 2022			$	(13)	$	(17)	$	(30)

(1)    All amounts are net of income tax, if subject to tax, and exclude NCI.

Reclassifications out of AOCI Table

RECLASSIFICATIONS OUT OF ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)
(Dollars in millions)
Details about accumulated other comprehensive income (loss) components	Amounts reclassified from accumulated other comprehensive income (loss)				Affected line item on Condensed Consolidated Statements of Operations
	Three months ended March 31,
	2023		2022
Sempra:
Financial instruments:
Interest rate instruments	$	—	$	(1)	Interest Expense
Interest rate instruments	(7)		14		Equity Earnings(1)
Foreign exchange instruments	—		(1)		Revenues: Energy-Related Businesses
	1		—		Other Income, Net
Foreign exchange instruments	1		(1)		Equity Earnings(1)
Interest rate and foreign exchange instruments	(6)		(6)		Other Income, Net
Total, before income tax	(11)		5
	3		(1)		Income Tax Expense
Total, net of income tax	(8)		4
	3		—		Earnings Attributable to Noncontrolling Interests
	$	(5)	$	4
Pension and PBOP(2):
Amortization of actuarial loss	$	—	$	2	Other Income, Net
Amortization of prior service cost	1		1		Other Income, Net
Total, before income tax	1		3
	—		(1)		Income Tax Expense
Total, net of income tax	$	1	$	2
Total reclassifications for the period, net of income tax and after NCI	$	(4)	$	6
SoCalGas:
Pension and PBOP(2):
Amortization of actuarial loss	$	—	$	1	Other (Expense) Income, Net
Amortization of prior service cost	1		—		Other (Expense) Income, Net
Total reclassifications for the period, net of income tax	$	1	$	1

(1)    Equity earnings at our foreign equity method investees are recognized after tax.

(2)    Amounts are included in the computation of net periodic benefit cost (see “Pension and PBOP” above).

Ownership Interests Held By Others Table

The following table provides information about NCI held by others in subsidiaries or entities consolidated by us and recorded in Other Noncontrolling Interests in Total Equity on Sempra’s Condensed Consolidated Balance Sheets.

OTHER NONCONTROLLING INTERESTS
(Dollars in millions)
	Percent ownership held by noncontrolling interests				Equity held by noncontrolling interests
	March 31, 2023		December 31, 2022		March 31, 2023		December 31, 2022
Sempra Infrastructure:
SI Partners	30.0	%	30.0	%	$	2,198	$	2,060
SI Partners subsidiaries(1)	0.1 - 30.0		0.1 - 16.6		360		61
Total Sempra					$	2,558	$	2,121

(1)    SI Partners has subsidiaries with NCI held by others. Percentage range reflects the highest and lowest ownership percentages among these subsidiaries.

Transactions with Affiliates Table

We summarize amounts due from and to unconsolidated affiliates at Sempra, SDG&E and SoCalGas in the following table.

AMOUNTS DUE FROM (TO) UNCONSOLIDATED AFFILIATES
(Dollars in millions)
	March 31, 2023		December 31, 2022
Sempra:
Tax sharing arrangement with Oncor Holdings	$	57	$	41
Various affiliates	17		13
Total due from unconsolidated affiliates – current	$	74	$	54
Sempra Infrastructure(1):
TAG Pipelines Norte, S. de R.L. de C.V. – 5.5% Note due January 9, 2024	$	(41)	$	—
Total due to unconsolidated affiliates – current	$	(41)	$	—
Sempra Infrastructure(1):
TAG Pipelines Norte, S. de R.L. de C.V.:
5.5% Note due January 9, 2024	$	—	$	(40)
5.5% Note due January 14, 2025	(23)		(23)
5.5% Note due July 16, 2025	(21)		(21)
5.5% Note due January 14, 2026	(19)		(19)
5.5% Note due July 14, 2026	(11)		(11)
5.5% Note due January 19, 2027	(14)		—
TAG – 5.74% Note due December 17, 2029	(190)		(187)
Total due to unconsolidated affiliates – noncurrent	$	(278)	$	(301)
SDG&E:
Sempra	$	(52)	$	(49)
SoCalGas	(75)		(72)
Various affiliates	(16)		(14)
Total due to unconsolidated affiliates – current	$	(143)	$	(135)
Income taxes due (to) from Sempra(2)	$	(8)	$	10
SoCalGas:
SDG&E	$	75	$	72
Various affiliates	1		5
Total due from unconsolidated affiliates – current	$	76	$	77
Sempra	$	(36)	$	(36)
Total due to unconsolidated affiliates – current	$	(36)	$	(36)
Income taxes due to Sempra(2)	$	(25)	$	(16)

(1)     U.S. dollar-denominated loans at fixed interest rates. Amounts include principal balances plus accumulated interest outstanding.

(2)    SDG&E and SoCalGas are included in the consolidated income tax return of Sempra, and their respective income tax expense is computed as an amount equal to that which would result from each company having always filed a separate return. Amounts include current and noncurrent income taxes due to/from Sempra.

The following table summarizes income statement information from unconsolidated affiliates.

INCOME STATEMENT IMPACT FROM UNCONSOLIDATED AFFILIATES
(Dollars in millions)
	Three months ended March 31,
	2023		2022
Sempra:
Revenues	$	13	$	7
Interest income	—		10
Interest expense	4		4
SDG&E:
Revenues	$	4	$	4
Cost of sales	30		24
SoCalGas:
Revenues	$	34	$	26
Cost of sales(1)	31		—

(1)     Includes net commodity costs from natural gas transactions with unconsolidated affiliates.

Other Income and Expense Table

Other Income, Net, consists of the following:

OTHER INCOME (EXPENSE), NET
(Dollars in millions)
	Three months ended March 31,
	2023		2022
Sempra:
Allowance for equity funds used during construction	$	33	$	35
Investment gains (losses), net(1)	12		(13)
Gains on interest rate and foreign exchange instruments, net	5		6
Foreign currency transaction gains (losses), net(2)	1		(19)
Non-service components of net periodic benefit cost	(25)		41
Interest on regulatory balancing accounts, net	18		1
Sundry, net	(3)		(13)
Total	$	41	$	38
SDG&E:
Allowance for equity funds used during construction	$	23	$	21
Non-service components of net periodic benefit cost	(4)		11
Interest on regulatory balancing accounts, net	10		1
Sundry, net	(1)		1
Total	$	28	$	34
SoCalGas:
Allowance for equity funds used during construction	$	10	$	13
Non-service components of net periodic benefit cost	(19)		32
Interest on regulatory balancing accounts, net	8		—
Sundry, net	(7)		(11)
Total	$	(8)	$	34

(1)    Represents net investment gains (losses) on dedicated assets in support of our executive retirement and deferred compensation plans. These amounts are offset by corresponding changes in compensation expense related to the plans, recorded in O&M on the Condensed Consolidated Statements of Operations.

(2)    Includes losses of $11 in the three months ended March 31, 2022 from translation to U.S. dollars of a Mexican peso-denominated loan to IMG, which are offset by corresponding amounts included in Equity Earnings on the Condensed Consolidated Statement of Operations.

Income Tax Expense and Effective Income Tax Rates Table

We provide our calculations of ETRs in the following table.

INCOME TAX EXPENSE AND EFFECTIVE INCOME TAX RATES
(Dollars in millions)
	Three months ended March 31,
	2023			2022
Sempra:
Income tax expense	$	376		$	334
Income before income taxes and equity earnings	$	1,329		$	665
Equity earnings, before income tax(1)	132			143
Pretax income	$	1,461		$	808
Effective income tax rate	26		%	41		%
SDG&E:
Income tax expense	$	7		$	64
Income before income taxes	$	265		$	298
Effective income tax rate	3		%	21		%
SoCalGas:
Income tax expense	$	94		$	84
Income before income taxes	$	454		$	418
Effective income tax rate	21		%	20		%

(1)    We discuss how we recognize equity earnings in Note 6 of the Notes to Consolidated Financial Statements in the Annual Report.