Southern California Gas Co 8-K, filed Feb 27, 2020

Southern California Gas Co (SOCGM)

8-K 2020-02-27 For: 2020-02-27

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Added on April 10, 2026

About this 8-K

Southern California Gas Co filed this 8-K on February 27, 2020.

Items reported

Item 2.02: Financial results
Item 9.01: Financial statements and exhibits

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555 West Fifth Street, Los Angeles, California						90013
(Address of principal executive offices)						(Zip Code)



Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐			Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐			Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐			Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐			Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


Exhibit Number						Exhibit Description
99.1						February 27, 2020 Sempra Energy News Release (including tables).
99.2						Sempra Energy's Statement of Operations Data by Segment for the three months and years ended December 31, 2019 and 2018.
104						Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


			SOUTHERN CALIFORNIA GAS COMPANY,
			(Registrant)

Date: February 27, 2020			By: /s/ Mia L. DeMontigny
			Mia L. DeMontigny Vice President, Controller, Chief Financial Officer and Chief Accounting Officer



	Three months ended							Years ended
	December 31,							December 31,
(Dollars, except EPS, and shares, in millions)	2019		2018⁽¹⁾			2019		2018⁽¹⁾

	(Unaudited)

GAAP Earnings	$	447	$	864		$	2,055	$	924

Tax Impacts from Expected Sale of South American Businesses	—		—			(99)		—

Gain on Sale of Certain Sempra Renewables Assets	—		(367)			(45)		(367)

(Adjustment)/Impairment of U.S. Non-utility Natural Gas Storage Assets	—		(126)			—		629

Impairment of U.S. Wind Equity Method Investments	—		—			—		145

Impact from the Tax Cuts and Jobs Act of 2017	—		60			—		85

Impairment of Investment in RBS Sempra Commodities	—		—			—		65

Impacts Associated with Aliso Canyon Litigation	—		—			—		22

Adjusted Earnings⁽²⁾	$	447	$	431		$	1,911	$	1,503


Diluted Weighted-Average Common Shares Outstanding	289		296			282		270
GAAP Earnings Per Diluted Common Share	$	1.55	$	3.03	⁽³⁾	$	7.29	$	3.42

Adjusted Diluted Weighted-Average Common Shares Outstanding⁽²⁾	289		276		⁽³⁾	282		270
Adjusted Earnings per Diluted Common Share⁽²⁾	$	1.55	$	1.56		$	6.78	$	5.57



Date of Report
(Date of earliest event reported):			February 27, 2020


SOUTHERN CALIFORNIA GAS COMPANY
(Exact name of registrant as specified in its charter)



Registrant's telephone number, including area code			(213) 244-1200





(Former name or former address, if changed since last report.)


SEMPRA ENERGY
Table A

CONSOLIDATED STATEMENTS OF OPERATIONS

	Three months ended December 31,						Years ended December 31,
(Dollars in millions, except per share amounts; shares in thousands)	2019		2018⁽¹⁾		2019		2018⁽¹⁾
	(unaudited)
REVENUES
Utilities	$	2,640	$	2,427	$	9,448	$	8,539
Energy-related businesses	303		399		1,381		1,563
Total revenues	2,943		2,826		10,829		10,102

EXPENSES AND OTHER INCOME
Utilities:
Cost of natural gas	(350)		(426)		(1,139)		(1,208)
Cost of electric fuel and purchased power	(259)		(321)		(1,188)		(1,358)
Energy-related businesses cost of sales	(79)		(99)		(344)		(357)
Operation and maintenance	(951)		(875)		(3,466)		(3,150)
Depreciation and amortization	(395)		(376)		(1,569)		(1,491)
Franchise fees and other taxes	(127)		(120)		(496)		(472)
Impairment losses	—		182		(43)		(1,122)
Gain on sale of assets	—		513		63		513
Other (expense) income, net	(26)		(134)		77		58
Interest income	23		19		87		85
Interest expense	(280)		(230)		(1,077)		(886)
Income from continuing operations before income taxes and equity earnings	499		959		1,734		714
Income tax (expense) benefit	(165)		(172)		(315)		49
Equity earnings	95		126		580		175
Income from continuing operations, net of income tax	429		913		1,999		938
Income from discontinued operations, net of income tax	71		51		363		188
Net income	500		964		2,362		1,126
Earnings attributable to noncontrolling interests	(18)		(64)		(164)		(76)
Mandatory convertible preferred stock dividends	(35)		(36)		(142)		(125)
Preferred dividends of subsidiary	—		—		(1)		(1)
Earnings attributable to common shares	$	447	$	864	$	2,055	$	924

Basic earnings per common share (EPS):


Earnings	$	1.57	$	3.15	$	7.40	$	3.45
Weighted-average common shares outstanding	284,649		274,331		277,904		268,072

Diluted EPS:


Earnings	$	1.55	$	3.03	$	7.29	$	3.42
Weighted-average common shares outstanding	288,787		296,429		282,033		269,852


		Pretax amount	Income tax expense (benefit)⁽¹⁾				Earnings			Pretax amount	Income tax expense (benefit)⁽¹⁾		Non-controlling interests		Earnings
(Dollars in millions, except per share amounts; shares in thousands)			Three months ended December 31, 2019												Three months ended December 31, 2018
Sempra Energy GAAP Earnings								$	447								$	864
Excluded items:

Gain on sale of certain Sempra Renewables assets			$	—	$	—		—			$	(513)	$	146	$	—	(367)
Reduction of impairment of non-utility natural gas storage assets			—		—			—			(183)		47		10		(126)
Impact from the TCJA			—		—			—			—		60		—		60
Sempra Energy Adjusted Earnings								$	447								$	431

Diluted EPS:
Sempra Energy GAAP Earnings⁽²⁾								$	447								$	900
Weighted-average common shares outstanding, diluted – GAAP								288,787									296,429
Sempra Energy GAAP EPS								$	1.55								$	3.03

Sempra Energy Adjusted Earnings for Adjusted EPS																	$	431
Weighted-average common shares outstanding, diluted – Adjusted⁽²⁾																	276,230
Sempra Energy Adjusted EPS																	$	1.56

		Year ended December 31, 2019											Year ended December 31, 2018
Sempra Energy GAAP Earnings								$	2,055								$	924
Excluded items:
Gain on sale of certain Sempra Renewables assets			$	(61)	$	16		(45)			$	(513)	$	146	$	—	(367)
Associated with holding the South American businesses for sale:
Change in indefinite reinvestment assertion of basis differences and structure of sale of discontinued operations			—		(89)			(89)			—		—		—		—
Reduction in tax valuation allowance against certain NOL carryforwards			—		(10)			(10)			—		—		—		—
Impacts associated with Aliso Canyon litigation			—		—			—			1		21		—		22
Impairment of U.S. wind equity method investments			—		—			—			200		(55)		—		145
Impairment of non-utility natural gas storage assets			—		—			—			1,117		(452)		(36)		629
Impairment of investment in RBS Sempra Commodities			—		—			—			65		—		—		65
Impact from the TCJA			—		—			—			—		85		—		85
Sempra Energy Adjusted Earnings								$	1,911								$	1,503

Diluted EPS:
Weighted-average common shares outstanding, diluted – GAAP								282,033									269,852
Sempra Energy GAAP EPS								$	7.29								$	3.42
Sempra Energy Adjusted EPS								$	6.78								$	5.57


⁽¹⁾	Except for adjustments that are solely income tax and tax related to outside basis differences, income taxes on pretax amounts were primarily calculated based on applicable statutory tax rates.
⁽²⁾	In the three months ended December 31, 2018, because the assumed conversion of the mandatory convertible preferred stock is dilutive for GAAP Earnings, the numerator used to calculate GAAP EPS includes an add-back of $36 million of mandatory convertible preferred stock dividends declared in that quarter. However, because the assumed conversion is antidilutive for the lower Adjusted Earnings, 20,199 mandatory convertible preferred stock shares are not included in the denominator used to calculate Adjusted EPS.


	Full-Year 2020
Sempra Energy GAAP EPS Guidance Range		$	12.78	to	$	14.26
Excluded item:
Estimated gain on sale of South American businesses		(6.08)			(6.76)
Sempra Energy Adjusted EPS Guidance Range		$	6.70	to	$	7.50
Weighted-average common shares outstanding, diluted (millions)					295


SEMPRA ENERGY
Table B

CONSOLIDATED BALANCE SHEETS

	December 31,		December 31,
(Dollars in millions)	2019		2018⁽¹⁾
ASSETS
Current assets:
Cash and cash equivalents	$	108	$	102
Restricted cash	31		35
Accounts receivable – trade, net	1,261		1,215
Accounts receivable – other, net	455		320
Due from unconsolidated affiliates	32		37
Income taxes receivable	112		60
Inventories	277		258
Regulatory assets	222		138
Greenhouse gas allowances	72		59
Assets held for sale	—		713
Assets held for sale in discontinued operations	445		459
Other current assets	324		249
Total current assets	3,339		3,645

Other assets:
Restricted cash	3		21
Due from unconsolidated affiliates	742		644
Regulatory assets	1,930		1,589
Nuclear decommissioning trusts	1,082		974
Investment in Oncor Holdings	11,519		9,652
Other investments	2,103		2,320
Goodwill	1,602		1,602
Other intangible assets	213		224
Dedicated assets in support of certain benefit plans	488		416
Insurance receivable for Aliso Canyon costs	339		461
Deferred income taxes	155		141
Greenhouse gas allowances	470		289
Right-of-use assets – operating leases	591		—
Wildfire fund	392		—
Assets held for sale in discontinued operations	3,513		3,259
Other long-term assets	732		962
Total other assets	25,874		22,554
Property, plant and equipment, net	36,452		34,439
Total assets	$	65,665	$	60,638


SEMPRA ENERGY
Table B (Continued)

CONSOLIDATED BALANCE SHEETS

	December 31,		December 31,
(Dollars in millions)	2019		2018⁽¹⁾
LIABILITIES AND EQUITY
Current liabilities:
Short-term debt	$	3,505	$	2,024
Accounts payable – trade	1,234		1,160
Accounts payable – other	179		138
Due to unconsolidated affiliates	5		10
Dividends and interest payable	515		480
Accrued compensation and benefits	476		440
Regulatory liabilities	319		105
Current portion of long-term debt and finance leases	1,526		1,644
Reserve for Aliso Canyon costs	9		160
Greenhouse gas obligations	72		59
Liabilities held for sale in discontinued operations	444		368
Other current liabilities	866		935
Total current liabilities	9,150		7,523

Long-term debt and finance leases	20,785		20,903

Deferred credits and other liabilities:
Due to unconsolidated affiliates	195		37
Pension and other postretirement benefit plan obligations, net of plan assets	1,067		1,143
Deferred income taxes	2,577		2,321
Deferred investment tax credits	21		24
Regulatory liabilities	3,741		4,016
Asset retirement obligations	2,923		2,786
Greenhouse gas obligations	301		131
Liabilities held for sale in discontinued operations	1,052		1,013
Deferred credits and other	2,048		1,493
Total deferred credits and other liabilities	13,925		12,964
Equity:
Sempra Energy shareholders’ equity	19,929		17,138
Preferred stock of subsidiary	20		20
Other noncontrolling interests	1,856		2,090
Total equity	21,805		19,248
Total liabilities and equity	$	65,665	$	60,638


SEMPRA ENERGY
Table C

CONSOLIDATED STATEMENTS OF CASH FLOWS

	Years ended December 31,
(Dollars in millions)	2019		2018⁽¹⁾
CASH FLOWS FROM OPERATING ACTIVITIES
Net income	$	2,362	$	1,126
Less: Income from discontinued operations, net of income tax	(363)		(188)
Income from continuing operations, net of income tax	1,999		938
Adjustments to reconcile net income to net cash provided by operating activities	1,259		1,878
Net change in other working capital components	(207)		433
Insurance receivable for Aliso Canyon costs	122		(43)
Wildfire fund, current and noncurrent	(323)		—
Changes in other noncurrent assets and liabilities, net	(152)		14
Net cash provided by continuing operations	2,698		3,220
Net cash provided by discontinued operations	390		296
Net cash provided by operating activities	3,088		3,516

CASH FLOWS FROM INVESTING ACTIVITIES
Expenditures for property, plant and equipment	(3,708)		(3,544)
Expenditures for investments and acquisitions, net of cash and cash equivalents acquired	(1,797)		(10,168)
Proceeds from sale of assets	899		1,580
Purchases of nuclear decommissioning trust assets	(914)		(890)
Proceeds from sales of nuclear decommissioning trust assets	914		890
Advances to unconsolidated affiliates	(16)		(95)
Repayments of advances to unconsolidated affiliates	3		3
Intercompany activities with discontinued operations, net	8		(22)
Other	30		41
Net cash used in continuing operations	(4,581)		(12,205)
Net cash used in discontinued operations	(12)		(265)
Net cash used in investing activities	(4,593)		(12,470)

CASH FLOWS FROM FINANCING ACTIVITIES
Common dividends paid	(993)		(877)
Preferred dividends paid	(142)		(89)
Issuances of mandatory convertible preferred stock, net	—		2,258
Issuances of common stock, net	1,830		2,272
Repurchases of common stock	(26)		(21)
Issuances of debt (maturities greater than 90 days)	4,296		8,927
Payments on debt (maturities greater than 90 days) and finance leases	(3,667)		(3,342)
Increase (decrease) in short-term debt, net	656		(84)
Advances from unconsolidated affiliates	155		—
Proceeds from sale of noncontrolling interests, net	5		90
Purchases of noncontrolling interests	(30)		(7)
Contributions from (distributions to) noncontrolling interests, net	98		(26)
Intercompany activities with discontinued operations, net	(266)		(109)
Other	(49)		(117)
Net cash provided by continuing operations	1,867		8,875
Net cash used in discontinued operations	(392)		(25)
Net cash provided by financing activities	1,475		8,850

Effect of exchange rate changes in continuing operations	—		(2)
Effect of exchange rate changes in discontinued operations	1		(12)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	1		(14)

Decrease in cash, cash equivalents and restricted cash, including discontinued operations	(29)		(118)
Cash, cash equivalents and restricted cash, including discontinued operations, January 1	246		364
Cash, cash equivalents and restricted cash, including discontinued operations, December 31	$	217	$	246


	SEMPRA ENERGY
	Table E

OTHER OPERATING STATISTICS (Unaudited)

		Three months ended December 31,						Years ended or at December 31,
		2019		2018		2019		2018
UTILITIES
SDG&E and SoCalGas
Gas sales (Bcf)⁽¹⁾			103		93		374		337
Transportation (Bcf)⁽¹⁾			149		134		573		581
Total deliveries (Bcf)⁽¹⁾			252		227		947		918

Total gas customer meters (thousands)							6,924		6,885

SDG&E
Electric sales (millions of kWhs)⁽¹⁾			3,601		3,643		14,397		15,125
Direct Access and Community Choice Aggregation (millions of kWhs)			909		947		3,549		3,628
Total deliveries (millions of kWhs)⁽¹⁾			4,510		4,590		17,946		18,753

Total electric customer meters (thousands)							1,471		1,459

Oncor⁽²⁾
Total deliveries (millions of kWhs)			30,916		29,800		133,378		107,276
Total electric customer meters (thousands)							3,685		3,621

Ecogas
Natural gas sales (Bcf)			1		—		3		7
Natural gas customer meters (thousands)							132		123


ENERGY-RELATED BUSINESSES
Power generated and sold
Sempra Mexico
Termoeléctrica de Mexicali (TdM) (millions of kWhs)			1,011		1,152		3,873		4,074
Wind and solar (millions of kWhs)⁽³⁾			333		252		1,442		1,176

⁽¹⁾	Includes intercompany sales.
⁽²⁾	Includes 100% of the electric deliveries and customer meters of Oncor Electric Delivery Company LLC (Oncor), in which we hold an 80.25% interest through our March 2018 acquisition of our equity method investment in Oncor Electric Delivery Holdings Company LLC (Oncor Holdings). Total deliveries for the year ended December 31, 2018 only include volumes from the March 9, 2018 acquisition date.


SEMPRA ENERGY
Table D

SEGMENT EARNINGS (LOSSES) AND CAPITAL EXPENDITURES, INVESTMENTS AND ACQUISITIONS

	Three months ended December 31,						Years ended December 31,
(Dollars in millions)	2019		2018⁽¹⁾		2019		2018⁽¹⁾
	(unaudited)
Earnings (Losses) Attributable to Common Shares
San Diego Gas & Electric	$	185	$	148	$	767	$	669
Southern California Gas	204		156		641		400
Sempra Texas Utilities	109		88		528		371
Sempra Mexico	39		76		253		237
Sempra Renewables	—		382		59		328
Sempra LNG	(19)		147		(6)		(617)
Parent and other	(132)		(174)		(515)		(620)
Discontinued operations	61		41		328		156
Total	$	447	$	864	$	2,055	$	924


	Three months ended December 31,						Years ended December 31,
(Dollars in millions)	2019		2018⁽¹⁾		2019		2018⁽¹⁾
	(unaudited)
Capital Expenditures, Investments and Acquisitions
San Diego Gas & Electric	$	451	$	348	$	1,522	$	1,542
Southern California Gas	420		411		1,439		1,538
Sempra Texas Utilities	347		179		1,685		9,457
Sempra Mexico	204		148		624		468
Sempra Renewables	—		10		2		56
Sempra LNG	39		104		222		306
Parent and other	5		(63)		11		345
Capital Expenditures, Investments and Acquisitions	$	1,466	$	1,137	$	5,505	$	13,712


SEMPRA ENERGY
Table F (Unaudited)
STATEMENT OF OPERATIONS DATA BY SEGMENT

Three months ended December 31, 2019
(Dollars in millions)		SDG&E		SoCalGas		Sempra Texas Utilities		Sempra Mexico		Sempra Renewables		Sempra LNG		Consolidating Adjustments, Parent & Other		Total
Revenues		$	1,259	$	1,383	$	—	$	317	$	—	$	83	$	(99)	$	2,943
Cost of sales and other expenses		(705)		(847)		—		(153)		—		(112)		51		(1,766)
Depreciation and amortization		(189)		(153)		—		(47)		—		(3)		(3)		(395)
Other (expense) income, net		(21)		(73)		—		70		—		—		(2)		(26)
Income (loss) before interest and tax⁽¹⁾		344		310		—		187		—		(32)		(53)		756
Net interest (expense) income		(99)		(36)		—		(10)		—		(1)		(111)		(257)
Income tax (expense) benefit		(60)		(70)		—		(111)		—		9		67		(165)
Equity earnings (losses), net		—		—		109		(19)		—		5		—		95
Earnings attributable to noncontrolling interests		—		—		—		(8)		—		—		—		(8)
Preferred dividends		—		—		—		—		—		—		(35)		(35)
Earnings (losses) from continuing operations		$	185	$	204	$	109	$	39	$	—	$	(19)	$	(132)	386
Earnings from discontinued operations																61
Earnings attributable to common shares																$	447

Three months ended December 31, 2018⁽²⁾
(Dollars in millions)		SDG&E		SoCalGas		Sempra Texas Utilities		Sempra Mexico		Sempra Renewables		Sempra LNG		Consolidating Adjustments, Parent & Other		Total
Revenues		$	1,163	$	1,262	$	—	$	348	$	21	$	142	$	(110)	$	2,826
Cost of sales and other expenses		(737)		(882)		—		(175)		(26)		(122)		100		(1,842)
Depreciation and amortization		(179)		(142)		—		(44)		—		(2)		(9)		(376)
Write-off and reduction in impairment losses		—		—		—		—		—		183		(1)		182
Gain (loss) on sale of assets		—		1		—		(1)		513		—		—		513
Other (expense) income, net		(21)		(34)		—		(63)		1		—		(17)		(134)
Income (loss) before interest and tax⁽¹⁾		226		205		—		65		509		201		(37)		1,169
Net interest (expense) income		(59)		(32)		—		(13)		2		10		(119)		(211)
Income tax (expense) benefit		(22)		(17)		—		41		(138)		(53)		17		(172)
Equity earnings (losses), net		—		—		88		38		1		(1)		—		126
Losses (earnings) attributable to noncontrolling interests		3		—		—		(55)		8		(10)		1		(53)
Preferred dividends		—		—		—		—		—		—		(36)		(36)
Earnings (losses) from continuing operations		$	148	$	156	$	88	$	76	$	382	$	147	$	(174)	823
Earnings from discontinued operations																41
Earnings attributable to common shares																$	864

⁽¹⁾	Management believes Income (Loss) Before Interest and Tax is a useful measurement of our segments’ performance because it can be used to evaluate the effectiveness of our operations exclusive of interest and income tax, neither of which is directly relevant to the efficiency of those operations.
⁽²⁾	Amounts have been retrospectively adjusted for discontinued operations.