EX-99.1 2 dex991.htm EDISON INTERNATIONAL PRESS RELEASE DATED MAY 8, 2008 Edison International Press Release dated May 8, 2008

Exhibit 99.1

 

LOGO    News Release                                
FOR IMMEDIATE RELEASE    Media Relations: Charles Coleman, (626) 302-7982
   www.edisonnews.com
   Investor Relations: Scott Cunningham, (626) 302-2540
   www.edisoninvestor.com

Edison International Reports First Quarter 2008 Earnings

 

•  

First quarter 2008 GAAP earnings were $0.91 per share compared to $1.01 per share in the first quarter of 2007.

 

•  

Core earnings increased 2% to $0.92 per share in the first quarter from $0.90 per share in the year-ago quarter, reflecting an increase of $0.01 per share at both Southern California Edison (SCE) and Edison Mission Group (EMG). The increase was largely due to lower net interest expense at SCE and higher gross margin at EMG’s Midwest Generation. Core earnings exclude non-core items and discontinued operations.

 

•  

The current outlook for Edison International 2008 core earnings is around the high end of its guidance range of $3.61 - $4.01 per share.

Edison International Financial Highlights

 

     Quarter Ended March 31,       

(In millions, except per share data)

    2008    2007    Change  

GAAP earnings per share

    $ 0.91    $ 1.01    $ (0.10 )

Core earnings per share

    $ 0.92    $ 0.90    $ 0.02  

GAAP earnings

    $ 299    $ 333    $ (34 )

Core earnings

    $ 304    $ 299    $ 5  

ROSEMEAD, Calif., May 8, 2008 — Edison International (NYSE: EIX) today reported first quarter 2008 earnings of $0.91 per share. Excluding non-core items, first quarter 2008 core earnings were $0.92 per share, up two percent compared with $0.90 per share in the year-ago first quarter.

“First quarter results were solid. Our improved outlook for the full year reflects positive margin trends in our unregulated power generation business,” said John E. Bryson, chairman and chief executive officer of Edison International.

 

Note: GAAP earnings refer to net income and GAAP earnings per share refer to basic earnings per share throughout this release. Core earnings is a non-GAAP financial measure; see reconciliation of core earnings to GAAP earnings and reconciliation of core earnings guidance to GAAP earnings guidance.

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Edison International Reports First Quarter 2008 Financial Results

Page 2 of 10

 

Earnings from Continuing Operations

SCE’s first-quarter 2008 earnings from continuing operations were $0.46 per share, compared to earnings of $0.55 per share in the same quarter last year; this decrease was primarily due to a non-core tax benefit of $0.10 per share last year from the favorable resolution of the income tax treatment of certain environmental remediation costs. Excluding the tax item, SCE’s core earnings in the first quarter increased $0.01 per share, compared to the same quarter last year. This increase was primarily due to lower net interest expense.

EMG’s first-quarter 2008 earnings from continuing operations and core earnings were $0.49 per share, compared to $0.48 per share in the same quarter last year. The increase was primarily due to higher gross margin and the buy-out of a coal contract at Midwest Generation together with higher energy trading results. This was partially offset by lower earnings from Edison Capital and other generation projects together with higher costs associated with EMG’s growth programs.

Discontinued Operations

Edison International’s loss from discontinued operations was $(0.01) per share in the first quarter of 2008 versus earnings from discontinued operations of $0.01 per share in the first quarter of 2007; both related to the 2004 sale of its international businesses.

 

     Quarter Ended March 31,        

Earnings (Loss) Per Share (Unaudited)

    2008     2007     Change  

Southern California Edison Company

    $ 0.46     $ 0.55     $ (0.09 )

Edison Mission Group

      0.49       0.48       0.01  

EIX parent company and other

      (0.03 )     (0.03 )     —    
                        

EIX GAAP earnings per share from continuing operations

      0.92       1.00       (0.08 )
                        

EIX GAAP earnings (loss) from discontinued operations

      (0.01 )     0.01       (0.02 )
                        

EIX GAAP earnings per share

    $ 0.91     $ 1.01     $ (0.10 )
                        

EIX diluted earnings per share

    $ 0.91     $ 1.00     $ (0.09 )
                        
     Quarter Ended March 31,        

Earnings (Loss) (in millions) (Unaudited)

    2008     2007     Change  

Southern California Edison Company

    $ 150     $ 180     $ (30 )

Edison Mission Group

      159       155       4  

EIX parent company and other

      (5 )     (5 )     —    
                        

EIX income from continuing operations

      304       330       (26 )
                        

Earnings (loss) from discontinued operations

      (5 )     3       (8 )
                        

EIX net income

    $ 299     $ 333     $ (34 )
                        

 

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Edison International Reports First Quarter 2008 Financial Results

Page 3 of 10

 

First Quarter Reconciliation of Core Earnings to GAAP Earnings

 

     Quarter Ended March 31,        

Core Earnings1 (Loss) Per Share (Unaudited)

    2008     2007     Change  

Southern California Edison Company

    $ 0.46     $ 0.45     $ 0.01  

Edison Mission Group

      0.49       0.48       0.01  

EIX parent company and other

      (0.03 )     (0.03 )     —    
                        

EIX core earnings per share

      0.92       0.90       0.02  
                        

Non-core items

       

SCE – tax item

      —         0.10       (0.10 )

Earnings (loss) from discontinued operations

      (0.01 )     0.01       (0.02 )
                        

Total non-core items

      (0.01 )     0.11       (0.12 )
                        

EIX GAAP earnings per share

    $ 0.91     $ 1.01     $ (0.10 )
                        
     Quarter Ended March 31,        

Core Earnings1 (Loss) (in millions) (Unaudited)

    2008     2007     Change  

Southern California Edison Company

    $ 150     $ 149     $ 1  

Edison Mission Group

      159       155       4  

EIX parent company and other

      (5 )     (5 )     —    
                        

EIX core earnings

      304       299       5  
                        

Non-core items

       

SCE – tax item

      —         31       (31 )

Earnings (loss) from discontinued operations

      (5 )     3       (8 )
                        

Total non-core items

      (5 )     34       (39 )
                        

Total EIX net income

    $ 299     $ 333     $ (34 )
                        

 

1

See Use of Non-GAAP Financial Measures on page 4. The impact of participating securities is included in EIX parent company and other and was $(0.01) per share in both quarters.

2008 EARNINGS GUIDANCE

The company reaffirmed its previously announced 2008 earnings guidance of $3.61 - $4.01 per share. It now sees 2008 core earnings being around the high end of the guidance range. See the risk disclosure statement on page 5 and the presentation accompanying the company’s conference call for further information.

 

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Edison International Reports First Quarter 2008 Financial Results

Page 4 of 10

 

Reconciliation of Core Earnings Guidance to GAAP Earnings Guidance

 

Core Earnings Per Share1

    2008 Guidance  

Southern California Edison

    $ 2.18 – 2.28  

Edison Mission Group

    $ 1.57 – 1.87  

EIX parent company and other

    $ (0.14 )
        

EIX core earnings per share

    $ 3.61 – $4.01  
        

Non-core items

      —    
        

EIX GAAP earnings per share

    $ 3.61 - $4.01  
        

 

1

Guidance excludes discontinued operations and non-core items. The expected impact of participating securities is ($0.05) per share and is included in EIX parent company and other.

Use of Non-GAAP Financial Measures

Edison International’s earnings are prepared in accordance with generally accepted accounting principles used in the United States and represent the company’s earnings as reported to the Securities and Exchange Commission. Our management uses core earnings and EPS by principal operating subsidiary internally for financial planning and for analysis of performance. We also use core earnings and EPS by principal operating subsidiary as primary performance measurements when communicating with analysts and investors regarding our earnings results and outlook, as it allows us to more accurately compare the company’s ongoing performance across periods. Core earnings exclude discontinued operations and other non-core items and are reconciled to GAAP earnings per share.

EPS by principal operating subsidiary is based on the principal operating subsidiary net income and Edison International's weighted average outstanding common shares. The impact of participating securities (vested stock options that earn dividend equivalents that may participate in undistributed earnings with common stock) for each principal operating subsidiary is not material to each principal operating subsidiary’s EPS and is therefore reflected in the results of the Edison International holding company, which we refer to as EIX parent company. EPS and core EPS by principal operating subsidiary are reconciled to GAAP earnings per share.

Reminder: Edison International Will Hold a Conference Call Today

Today, Edison International will hold a conference call to discuss its first quarter 2008 financial results at 8 a.m. (Pacific Daylight Time). Two-way participation in the telephone call is limited to financial analysts and investors, while all other interested parties are invited to participate in a simultaneous webcast at www.edisoninvestor.com. A presentation accompanying management’s comments on the conference call will be available on the web site as well at www.edisoninvestor.com. The domestic call-in number is (800) 356-8584 and the number for international callers is (850) 429-1225. The ID# is 11600. In addition to the live simulcast, the webcast will remain posted at www.edisoninvestor.com and telephone replays will be available through Thursday, May 15, 2008, at the following numbers: (877) 693-4277 for callers in the United States and (402) 220-0042 for international callers. The ID# is 11601.

 

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Edison International Reports First Quarter 2008 Financial Results

Page 5 of 10

 

Risk Disclosure Statement

Statements contained in this news release about future performance, including, without limitation, earnings, asset and rate base growth, load growth, capital investments and other statements that are not purely historical, are forward-looking statements. These forward-looking statements reflect our current expectations; however, such statements involve risks and uncertainties. Actual results could differ materially from current expectations. Important factors that could cause different results are discussed under the headings “Risk Factors” and “Management’s Discussion and Analysis” in Edison International’s 2007 Form 10-K and other reports filed with the Securities and Exchange Commission and are available on our Web site at www.edisoninvestor.com. These forward-looking statements represent our expectations only as of the date of this news release, and Edison International assumes no duty to update them to reflect new information, events or circumstances.

# # #

Edison International (NYSE:EIX), through its subsidiaries, is a generator and distributor of electric power and an investor in infrastructure and energy assets, including renewable energy. Headquartered in Rosemead, Calif., Edison International is the parent company of Southern California Edison, the largest electric utility in California, and Edison Mission Group, a competitive power generation business and parent company to Edison Mission Energy and Edison Capital.

 

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Edison International Reports First Quarter 2008 Financial Results

Page 6 of 10

 

Edison International

Consolidated Statements of Income

 

     Three Months Ended
March 31,		  

In millions, except per-share amounts

    2008     2007  
     (Unaudited)  

Electric utility

    $ 2,349     $ 2,222  

Nonutility power generation

      719       672  

Financial services and other

      15       18  
                

Total operating revenue

      3,083       2,912  
                

Fuel

      537       486  

Purchased power

      491       317  

Provisions for regulatory adjustment clauses – net

      172       289  

Other operation and maintenance

      974       880  

Depreciation, decommissioning and amortization

      298       313  

Gain on buyout of contract and sale of assets

      (17 )     —    
                

Total operating expenses

      2,455       2,285  
                

Operating income

      628       627  

Interest and dividend income

      14       39  

Equity in income from partnerships and unconsolidated subsidiaries – net

      2       17  

Other nonoperating income

      25       17  

Interest expense – net of amounts capitalized

      (171 )     (198 )

Other nonoperating deductions

      (12 )     (11 )
                

Income from continuing operations before tax and minority interest

      486       491  

Income tax expense

      161       129  

Dividends on preferred and preference stock of utility not subject to mandatory redemption

      13       13  

Minority interest

      8       19  
                

Income from continuing operations

      304       330  

Income (loss) from discontinued operations – net of tax

      (5 )     3  
                

Net income

    $ 299     $ 333  
                

Weighted-average shares of common stock outstanding

      326       326  

Basic earnings (loss) per common share:

     

Continuing operations

    $ 0.92     $ 1.00  

Discontinued operations

      (0.01 )     0.01  
                

Total

    $ 0.91     $ 1.01  
                

Weighted-average shares, including effect of dilutive securities

      329       330  

Diluted earnings (loss) per common share:

     

Continuing operations

    $ 0.92     $ 0.99  

Discontinued operations

      (0.01 )     0.01  
                

Total

    $ 0.91     $ 1.00  
                

Dividends declared per common share

    $ 0.305     $ 0.29  

 

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Edison International Reports First Quarter 2008 Financial Results

Page 7 of 10

 

Edison International

Consolidated Balance Sheets

 

In millions

    March 31,
2008		     December 31,
2007		  
     (Unaudited)        

ASSETS

     

Cash and equivalents

    $ 1,545     $ 1,441  

Short-term investments

      35       81  

Receivables, less allowance of $34 for uncollectible accounts at each date

      1,038       1,033  

Accrued unbilled revenue

      342       370  

Fuel inventory

      120       116  

Materials and supplies

      311       316  

Derivative assets

      192       109  

Restricted cash

      3       3  

Margin and collateral deposits

      147       121  

Regulatory assets

      128       197  

Accumulated deferred income taxes – net

      218       167  

Other current assets

      339       290  
                

Total current assets

      4,418       4,244  
                

Nonutility property – less accumulated provision for depreciation of $1,822 and $1,765 at respective dates

      4,951       4,906  

Nuclear decommissioning trusts

      3,195       3,378  

Investments in partnerships and unconsolidated subsidiaries

      260       272  

Investments in leveraged leases

      2,486       2,473  

Other investments

      108       96  
                

Total investments and other assets

      11,000       11,125  
                

Utility plant, at original cost:

     

Transmission and distribution

      19,158       18,940  

Generation

      1,795       1,767  

Accumulated provision for depreciation

      (5,306 )     (5,174 )

Construction work in progress

      1,820       1,693  

Nuclear fuel, at amortized cost

      231       177  
                

Total utility plant

      17,698       17,403  
                

Derivative assets

      135       122  

Restricted cash

      45       48  

Rent payments in excess of levelized rent expense under plant operating leases

      765       716  

Regulatory assets

      2,726       2,721  

Other long-term assets

      1,164       1,144  
                

Total long-term assets

      4,835       4,751  
                

Total assets

    $ 37,951     $ 37,523  
                

 

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Edison International Reports First Quarter 2008 Financial Results

Page 8 of 10

 

Edison International

Consolidated Balance Sheets

 

In millions

    March 31,
2008		     December 31,
2007		  
     (Unaudited)        

LIABILITIES AND SHAREHOLDERS’ EQUITY

     

Short-term debt

    $ 400     $ 500  

Long-term debt due within one year

      164       18  

Accounts payable

      807       979  

Accrued taxes

      119       49  

Accrued interest

      223       160  

Counterparty collateral

      48       42  

Customer deposits

      221       219  

Book overdrafts

      192       212  

Derivative liabilities

      203       125  

Regulatory liabilities

      1,201       1,019  

Other current liabilities

      814       933  
                

Total current liabilities

      4,392       4,256  
                

Long-term debt

      9,325       9,016  
                

Accumulated deferred income taxes – net

      5,201       5,196  

Accumulated deferred investment tax credits

      112       114  

Customer advances

      149       155  

Derivative liabilities

      111       101  

Power-purchase contracts

      22       22  

Accumulated provision for pensions and benefits

      1,133       1,089  

Asset retirement obligations

      2,925       2,892  

Regulatory liabilities

      3,256       3,433  

Other deferred credits and other long-term liabilities

      1,654       1,595  
                

Total deferred credits and other liabilities

      14,563       14,597  
                

Total liabilities

      28,280       27,869  
                

Minority interest

      282       295  
                

Preferred and preference stock of utility not subject to mandatory redemption

      907       915  
                

Common stock, no par value (325,811,206 shares outstanding at each date)

      2,238       2,225  

Accumulated other comprehensive loss

      (242 )     (92 )

Retained earnings

      6,486       6,311  
                

Total common shareholders’ equity

      8,482       8,444  
                

Total liabilities and shareholders’ equity

    $ 37,951     $ 37,523  
                

 

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Edison International Reports First Quarter 2008 Financial Results

Page 9 of 10

 

Edison International

Consolidated Statements of Cash Flows

 

     Three Months Ended
March 31,		  

In millions

    2008     2007  
     (Unaudited)  

Cash flows from operating activities:

     

Net income

    $ 299     $ 333  

Less: Income (loss) from discontinued operations

      (5 )     3  
                

Income from continuing operations

      304       330  

Adjustments to reconcile to net cash provided by operating activities:

     

Depreciation, decommissioning and amortization

      298       313  

Realized loss on impairment of nuclear decommissioning trusts

      45       8  

Other amortization

      27       31  

Gain on buyout of contract and sale of assets

      (17 )     —    

Stock based compensation

      6       6  

Minority interest

      8       19  

Deferred income taxes and investment tax credits

      31       (158 )

Equity in income from partnerships and unconsolidated subsidiaries

      (2 )     (16 )

Income from leveraged leases

      (13 )     (16 )

Regulatory assets

      77       173  

Regulatory liabilities

      186       152  

Levelized rent expense

      (48 )     (49 )

Derivative assets

      (96 )     (105 )

Derivative liabilities

      (162 )     (201 )

Other assets

      (20 )     (14 )

Other liabilities

      92       226  

Margin and collateral deposits – net of collateral received

      (21 )     (7 )

Receivables and accrued unbilled revenue

      22       77  

Inventory and other current assets

      (35 )     (90 )

Book overdraft

      (20 )     24  

Accrued interest and taxes

      133       266  

Accounts payable and other current liabilities

      (215 )     (238 )

Distributions and dividends from unconsolidated entities

      (2 )     (1 )

Operating cash flows from discontinued operations

      (5 )     3  
                

Net cash provided by operating activities

      573       733  
                

Cash flows from financing activities:

     

Long-term debt issued

      677       30  

Long-term debt issuance costs

      (9 )     (1 )

Long-term debt repaid

      (7 )     (95 )

Bonds repurchased

      (212 )     —    

Preference stock redeemed

      (7 )     —    

Rate reduction notes repaid

      —         (62 )

Short-term debt financing – net

      (100 )     120  

Shares purchased for stock-based compensation

      (24 )     (106 )

Proceeds from stock option exercises

      7       39  

Excess tax benefits related to stock option exercises

      6       17  

Dividends to minority shareholders

      (17 )     (24 )

Dividends paid

      (99 )     (94 )
                

Net cash provided (used) by financing activities

    $ 215     $ (176 )
                

 

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Edison International Reports First Quarter 2008 Financial Results

Page 10 of 10

 

Edison International

Consolidated Statements of Cash Flows

 

     Three Months Ended
March 31,		  

In millions

    2008     2007  
     (Unaudited)  

Cash flows from investing activities:

     

Capital expenditures

    $ (705 )   $ (691 )

Purchase of interest of acquired companies

      —         (4 )

Proceeds from sale of property and interests in projects

      2       —    

Proceeds from nuclear decommissioning trust sales

      829       1,029  

Purchases of nuclear decommissioning trust investments and other

      (859 )     (1,062 )

Proceeds from partnerships and unconsolidated subsidiaries, net of investment

      9       15  

Maturities and sales of short-term investments

      47       1,422  

Purchase of short-term investments

      (1 )     (1,339 )

Restricted cash

      2       38  

Customer advances for construction and other investments

      (8 )     (59 )
                

Net cash used by investing activities

      (684 )     (651 )
                

Net increase (decrease) in cash and equivalents

      104       (94 )

Cash and equivalents, beginning of period

      1,441       1,795  
                

Cash and equivalents, end of period

    $ 1,545     $ 1,701