Edison International (EIX) Q2 Earnings call transcript Jul 25, 2024
1min read Edison International, the parent company of Southern California Edison (SCE), held its second quarter 2024 financial teleconference, shedding light on its operational and financial performance, strategic plans, and market outlook. Led by Vice President of Investor Relations, Sam Ramraj, the call featured insights from Pedro Pizarro, President and CEO, and Maria Rigatti, Executive Vice President and CFO, along with other key executives. Here are the critical takeaways from the call.
Financial Performance and Guidance
Edison International reported a strong first half of the year, with a core EPS of $1.23, bringing the year-to-date core EPS to $2.37. The company reaffirmed its 2024 core EPS guidance of $4.75 to $5.05, demonstrating confidence in its financial health and strategic initiatives. SCE's system average rate is now projected to align with inflation rates, ensuring more stable costs for customers.
Operational and Financial Risk Profiles
The company's operational and financial risk profiles have significantly improved, with a substantial reduction in wildfire risk, thanks to physical grid hardening efforts and successful wildfire mitigation work. SCE is now approaching 90% of total distribution lines in high fire risk areas being hardened, leading the way in physical risk reduction among California investor-owned utilities.
Sustainability and Carbon-Neutrality
Edison International is leading the charge towards a carbon-neutral California, with sustainability at the core of its strategy. The company's commitment to reducing greenhouse gas emissions and focusing on grid investments for a more resilient and equitable clean energy economy is commendable. In 2023, SCE delivered 52% carbon-free power to customers, significantly exceeding the national average.
Load Growth and CapEx Opportunities
Load growth trends are materializing sooner than expected, with SCE now forecasting a 35% increase in 10-year load growth. This trend, driven by customer demand for load growth projects and policy-driven electric vehicle and building electrification, necessitates substantial investments in grid upgrades to accommodate the increased load. Despite this, affordability remains a top priority, with SCE demonstrating cost leadership over the years, resulting in the lowest system average rate among California IOUs.
Regulatory Outcomes and Ongoing Proceedings
The company's regulatory outcomes have been positive, with SCE receiving favorable decisions on key proceedings, including the CEMA application and interim rate recovery. The company is confident in getting a strong outcome for customers in the ongoing 2025 GRC and TKM cost recovery proceedings.
In summary, Edison International's second quarter 2024 financial teleconference painted a positive picture of the company's financial health, operational performance, and strategic direction. With a focus on sustainability, grid upgrades, and customer affordability, Edison International is well-positioned to lead the charge towards a carbon-neutral California, ensuring a reliable, resilient, and ready grid for the future.