Sempra Stock Price: Quote, Forecast, Splits & News (SRE)

SRE

Sempra

SRE

Overview

Financials

Historical Data

$74.39

+$0.31

0.42%

At close: Jun 18, 4:00:02 PM EDT

$74.32

-$0.07

0.09%

After hours: 6:22:25 PM EDT

Financial information provided by Financial Modeling Prep. Options data provided by Unusual Whales. Live transcripts provided by Quartr. Reported revenue and EPS data from Earnings powered by FinChat.io. All data is provided for informational purposes only, and is not intended for trading purposes or financial, investment, tax, legal, accounting or other advice.

Market Cap: $49B
IPO Date: 6/29/98
CEO: Mr. Jeffrey Walker Martin
Fulltime Employees: 17K
Sector: Utilities
Industry: Diversified Utilities
Country: US
Exchange: New York Stock Exchange

Peers

$0.00

Watchlist

$0.00

Sempra Stock Price: Quote, Forecast, Splits & News (SRE)

Perplexity Finance

SRE

Sempra

SRE

Overview

Financials

Historical Data

$74.39

+$0.31

0.42%

At close: Jun 18, 4:00:02 PM EDT

$74.32

-$0.07

0.09%

After hours: 6:22:25 PM EDT

Market Cap: $49B
IPO Date: 6/29/98
CEO: Mr. Jeffrey Walker Martin
Fulltime Employees: 17K
Sector: Utilities
Industry: Diversified Utilities
Country: US
Exchange: New York Stock Exchange

Peers

$0.00

Watchlist

$0.00

Change

+$0.31

0.42%

Financial Profile

Prev Close

$74.08

Market Cap

$48.51B

Day Range

$73.84 - $75.06

Open

$73.90

P/E Ratio

16.4

52W Range

$61.90 - $95.77

24H Volume

$242.35M

Dividend Yield

3.37%

EPS

4.55

Key Issues

Latest Price Movement

Jun 20

Earnings

Report Date

May 8, 2025

Reported Revenue

3.8B

Miss -2.94%

Avg 1d Change

7.12%

Report Period

Q1 2025

Reported EPS

1.4

Beat +9.09%

Implied Move 1d

4.57%

Transcript

9m 53s

A live webcast of this teleconference and Slide presentation are available on our website under our Events and Presentations section. We have several members of our management team with us today, including Jeff Martin, Chairman and Chief Executive Officer Karen Sedrick, Executive Vice President and Chief Financial Officer Justin Bird, Executive Vice President and Chief Executive Officer of Sempra Infrastructure Alan Nye, Chief Executive Officer of Encore Don Clevinger, Chief Financial Officer of Encore Carolyn Winn, Chief Executive Officer of SDG and E Peter Wall, Senior Vice President, Controller and Chief Accounting Officer and other members of our senior management team. Before starting, I'd like to remind everyone that we'll be discussing forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, Actual results may differ materially from those projected in any forward looking statement we make today. The factors that could cause our actual results to differ materially are discussed in the company's most recent ten and ten Q filed with the SEC. Earnings per common share amounts in our presentation are shown on a diluted basis, and we'll be discussing certain non GAAP financial measures. Please refer to the presentation slides that accompany this call for a reconciliation to GAAP measures.

11m 19s

We also encourage you to review our 10 Q for the quarter ended March 31, 2025. I'd also like to mention that forward looking statements contained in this presentation speak only of today, 05/08/2025, and it's important to note that the company does not assume any obligation to update or revise any of these forward looking statements in the future. With that, please turn to Slide three, and let me hand the call over to Jeff. Thank you all for joining us today. Earlier this morning, we were reported first quarter twenty twenty five adjusted EPS of $1.44 which compares favorably to the prior period's results of $1.34 In addition, we're pleased to affirm our full year 2025 adjusted EPS guidance range of $4.3 to $4.7 and we're also affirming our 2026 EPS guidance of $4.8 to $5.3 You'll also recall that we've issued a projected long term EPS CAGR of 7% to 9% for 2025 through 2029, and have guided to the high end or above that range. As we have discussed, this projection is a compound annual growth rate for the five year planning period, does not imply linear growth year to year. Now let's turn to our plan of execution for the remainder of the year.

12m 41s

Today, our first quarter results reflect a positive step toward the execution of five value creation initiatives. First, we plan to invest roughly $13,000,000,000 this year in energy infrastructure with over 10,000,000,000 targeted our U. S. Utilities. Just as important, we have initiatives underway that are intended to improve the regulatory compact in both Texas and California. Second, we continue to review opportunities to realign our portfolio support the growth and expansion of our Texas and California utilities. While also maintaining a strong balance sheet. As a result, we announced our intention to sell minority interest in Sempra Infrastructure Partners, Given the robust demand today for energy infrastructure assets, we expect to complete a transaction that highlights the continued growth in the value of that business. Third, we're continuing our strategy of selling noncore assets and recycling capital to finance our future growth. That's why we recently announced our plans to divest ECOgas a regulated natural gas distribution utility in Northern Mexico. In combination, these actions are designed to advance our company's broader effort to simplify the business and reduce reliance on future issuances of common equity to fund the company's five year plan. With the close of these transactions and the anticipated growth of our utilities, we expect our regulated businesses will account for a much larger percentage of Sempra's earnings on an annualized basis.

14m 14s

It's also important to note that we expect these combined transactions to be accretive to the company's earnings per share forecast and credit enhancing. We also continue to execute on our Fit for 2025 campaign that we launched in the summer of twenty twenty four, The goal of this initiative is to reduce the company's cost structure to align with our future business needs. These efforts are also focused on new technology adoption, including the use of artificial intelligence to improve productivity and customer service. Taken together, these efforts are expected to help support improvements the affordability of our services and our financial performance. And finally, we'll continue our foundational work of delivering safe and reliable energy for our customers through operational excellence. We're an established leader today in wildfire science and mitigation, and we'll look to build on those competitive advantages here in California as well as at Encore. The key takeaway is we have an exceptional opportunity to grow and competitively differentiate our company through the end of the decade. To deliver on that opportunity, we understand the importance of executing well in the near term. Our first quarter financial results are an important first step and as a management team, we have a plan of execution in place for the balance of 2025 that we believe will make our company stronger and more valuable.

15m 40s

With that, please turn to Slide four, where Karen will walk through business and financial updates.

15m 45s

Thank you, Jeff. Let me start by saying our three growth platforms are off to a solid start for the year. Let's start with Texas. Last year, ERCOT projected peak load growth to increase to 150 gigawatts by 02/1930, To meet this demand, ERCOT is proposing a regional transmission plan that would overlay new high voltage backbone across the state's transmission grid. Both the three forty five kV the seven sixty five kV investments are under consideration. Together with the Permian plan, ERCOT estimates these investments will total between 32,000,000,000 and $35,000,000,000 That includes approximately 14,000,000,000 to $15,000,000,000 for the Permian plan, with the import transmission pass being constructed at the seven sixty five kV level. [indiscernible] $18,000,000,000 to $20,000,000,000 for the remaining transmission build out. I would refer you to slide nine in the appendix for a graphic provides additional details on this. As a major owner of existing endpoints across Texas, we believe OnCore is well positioned to construct a significant portion of the required transmission infrastructure that's been identified by ERCOT. OnCore is still assessing the impact of these developments, and expects to have a better sense of the projected investment opportunity once the associated CCNs are filed.

17m 6s

Oncor has begun seeking approvals for the remainder of the Permian plan, and expects to continue making the required CCN filings including for the import pass, through 2026. We're also currently monitoring the legislative session in Texas, including potential legislation that, if passed, might have beneficial impacts on the regulatory framework supporting T and D investments in Texas. In the meantime, Oncor is continuing to prepare to file its comprehensive base rate review, and currently anticipates filing in the second quarter. Moving to Sempra, California, I'd like to start by discussing an update on the regulatory front. Every three years, California utilities submit a new cost of capital application to the CPUC, which sets authorized rates of return for their investments in critical infrastructure. In March, SDG and E and SoCalGas, along with other large California IOUs, filed their respective cost of capital applications. The current cost of capital filings are for the years 2026 through 2028, and seek to update SDG and E and SoCalGas' respective rates of return to align with current market conditions. SDGD requested a 54% common equity layer and 11.25% return on equity. At SoCalGas, the company requested a 52% common equity layer and 11% return on equity.

18m 31s

Please see slide 11 in the appendix for a breakout of additional details. We expect a decision from the CPUC by the end of the year with the newly authorized rates of return effective at the start of twenty twenty As a reminder, this would be subject to the cost of capital adjustment mechanism. Otherwise known as the CCM. Which would apply in the years '27 and 2028. As it relates to the FERC TO-six filing, STGD's current authorized rate is 10.1%, you'll recall that authorized one And that STGD's which excludes the 50 basis point CAISO adder currently in the appeals process, New interim rates are scheduled to be implemented June 1, subject to refund. The settlement process is ongoing and expected to be resolved in the second half of this year. Also in the first quarter, the CPUC approved a expansion of West Side Canal battery storage, adding 100 megawatts of energy storage capacity to the existing 131 megawatt facility.

19m 31s

This expansion should be fully operational this summer, and represents a significant investment in the region's energy infrastructure. Supporting local communities by providing more reliable and clean power and positioning the region as a leader in sustainable energy solutions. Moving to affordability initiatives. Jeff discussed our Fit for 2025 campaign earlier. But I also want to mention that STGD and SoCalGas customers received a one time California Climate Credit lowering bills last month by as much as a hundred and $36 at SDG and E, and $87 at SoCalGas. Also, there'll be a second credit applied to the bills of SDG and E customers in October bringing the total expected bill credit up to $217 in 2020 Also in March, an amended memorandum and ruling was issued as establishing the scope and schedule for track three of the 2024 GRC. Testimony was filed to review the reasonableness of SoCalGas' pipeline safety enhancement costs for 2015 to 2020 SDG and E's pipeline safety enhancement costs from 2014 to 2019, and STG and E's wildfire mitigation costs in 2023. A proposed decision as anticipated the first half of twenty twenty six. On the tariff front, we are closely monitoring potential impacts at Sempra California.

20m 54s

We've been proactive in taking action to manage rising prices to reduce impacts to our ratepayers. Since the pandemic, we analyzed where more supply chain risk exists and added additional sources of supply. We expect those diversified sources to help us better manage and mitigate tariff risks. We've also engaged with suppliers in an effort to source more domestically produced equipment and materials where possible. Stocking inventory of critical materials, exploring new sources of supply that help reduce tariff exposure. These activities form a part of our larger program of improving the affordability of our utility services. Services. Moving to Sempra infrastructure, In March, we announced our plan to sell a certain non core energy infrastructure assets in Mexico as well as a minority interest Sempra Infrastructure Partners. Jeff discussed both earlier, but I would like to add that initial interest around these assets has been robust. On the minority interest sale process at Sempra Infrastructure Partners, you'll recall that KKR and Audia have certain rights of first offer followed by Sempra's right to respond. Also as is customary, we are unable to reach an agreement with our current partners we're prepared to pursue a third party bids in an open and competitive process to help increase the value for Sempra shareholders.

22m 10s

As outlined, we believe it will take a reasonable amount of time for both transactions to unfold and expect to provide our next update on the second quarter call in August. Moving to operational updates. Cameron LNG Phase one loaded 55 cargoes achieved a 98% plant reliability in Q1 twenty twenty five. Together with our partners, we're very pleased with the high quality operations from this critical infrastructure asset. As it relates to tariff impacts, we're actively monitoring the involving situation and assessing its potential impact on our businesses. Our current understanding is that energy, as defined as a cross border electric and natural gas deliveries, is a USMCA compliant good. And is therefore unaffected by tariffs.

22m 55s

As a result, we do not currently anticipate significant impacts from cross border energy transactions. We also continue to advance major construction projects at Cimarron Wind, ECA LNG Phase one, and Port Arthur LNG Phase one. Cimarron Wind is progressing key construction activities, including turbine installations, and continues to target power generation in late twenty twenty five with COD planned for the first half of twenty twenty six. At ECHA LNG Phase 1, we have over 5,200 workers on-site construction is currently focused on pipe testing, electrical activities, instrumentation, and insulation with the project around 92% complete. Additionally, excited to share that ECA LNG Phase 1 has achieved mechanical completion of various subsystems. Which allows for the start of pre commissioning activities. These developments are consistent with the expectation of commercial operations in spring of twenty twenty six. Moreover, I would note that ECHA LNG Phase 1 our EPC contractor has completed its engineering and procurement activities so we're not anticipating any significant impacts from increases in material costs. Moving to Port Arthur LNG Phase 1, I'd like to take a moment to acknowledge the safety incidents that occurred last week at the Port Arthur facility. Which has resulted in the loss of three Bechtel employees.

24m 19s

Our deepest condolences go out to the families and colleagues affected by this incident. Port over construction has progressed, including the foundations, steel and pipe installations, dredging activities, major equipment setting, and other key milestones. Also on the tariff front, Port Arthur LNG began admitting all items in the designated foreign trade zones into The United States. As a preemptive action back in February to avoid higher costs being levied on these items. Earlier this year, we announced that we expect to take FID on Port R for LNG phase two by the end of twenty twenty five. That remains our target as we're continuing to field strong commercial interest in the project. With that said, uncertainty in the macroeconomic environment may affect the timing of project development. As we have done in the past, we'll continue to exercise patience as we seek to mitigate cost risk and lock in favorable long term economics. To wrap up, energy infrastructure remains a crucial component to economic growth and development and allies in Europe and Asia are looking to American leadership to improve their energy security. That's why we continue to believe Sempra infrastructure is well positioned to create value for its owners as we look to complete a series of important construction projects and capture new opportunities by extending the scale and reach of our platform.

25m 42s

Now please turn to the next slide I'll walk through an update on our financial performance. Earlier today, Sempra reported first quarter twenty twenty five GAAP earnings of $9.00 $6,000,000 or $1.39 per share. This compares to first quarter twenty twenty four GAAP earnings of $8.00 $1,000,000 or $1.26 per share. On an adjusted basis, first quarter twenty twenty five earnings were $942,000,000 or $1.44 per share. This compares to our first quarter twenty twenty four earnings of $854,000,000 or $1.34 per share. We're pleased with these financial results and believe they represent a solid start to the year. Please turn to the next slide. Variances in the first quarter twenty twenty five adjusted earnings as compared to the same period last year can be summarized as follows. At Sempra California, we had $88,000,000 from higher CPUC based operating margin, net of operating expenses, and lower authorized cost of capital. Sempra California also had $54,000,000 of higher income tax benefits. Partially offset by higher net interest expense and other. As a reminder, in the first three quarters of twenty twenty four, Sempra California reported revenues and taxes in accordance with 2023 CPUC authorized levels. Turning to Sempra Texas, we had $37,000,000 of lower equity earnings primarily from higher interest and operating [indiscernible] partially offset by higher revenues from invested capital and higher consumption attributable to weather and customer growth.

27m 21s

As Sempra infrastructure, we largely reported in line to the prior period, with $2,000,000 of decrease driven by lower asset optimization, partially offset by lower O and M, and higher interest income. And, at the parent, dollars 15,000,000 decrease is primarily due to higher net interest expense partially offset by other expenses. Please turn to the next slide. To conclude our prepared remarks, we're off to a solid start for the year. We understand the importance of our plan of execution for 2025 and across our management team, we're focused on delivering the strategic initiatives that Jeff outlined on today's call. Taken together, these initiatives are designed to divest non core assets in support of recycling proceeds into new investments in our Texas and California utilities. Strengthen the company's balance sheet while efficiently funding growth and improving the quality and affordability of our services and reward Sempra's owners with improved visibility to consistent growth in earnings and cash flows and long term value creation. Our first quarter results represent an important first step in our growth plans. With that, we'll now take a moment to open the line and answer your questions. Thank you. This concludes the prepared remarks. We will now open the line to take your questions.

28m 45s

On your telephone keypad. Please make sure your mute function is turned off. We will pause for just a moment to allow everyone to signal for questions. And our first question will come from Ross Fowler from Bank of America. Your line is open.

29m 5s

Good morning. How are you? Good morning, John. Good morning, Karen.

29m 8s

Good morning.

29m 10s

So just a couple of questions to touch on.

29m 13s

Maybe I'm just tired because I'm 42 earnings releases deep. But just to walk through the SIP process from here, I think KKR would be due on May 12 and then we've got if I've got it right ten business days for Adia and then you would have thirty days to respond to either one of those, which would kinda put us late June, early July, And that's the sort of contextualization for why you're talking about an update on the second quarter call. Am thinking about that correctly?

29m 42s

Yeah. The only thing I would clarify is to think about that sequentially. So once KKR provides their written offer, if they were to bid, then Sempra has a thirty day process to deliberate that and or respond. After that process, then Adi would have their ten days followed by Sempra's thirty days to respond to that. So I think feel comfortable that Q2 call will be the appropriate time to update it. Look, we certainly realize that people like more details. I think we're all supposed thing to do is just let the process play itself out I think Q2 will be the appropriate time for an update.

30m 19s

Perfect, Jeff. Thank you. And then, Alan, maybe one for you, just as we sort of contextualize what you've referred to I think in our conversations in the past is the Texas miracle and the Texas growth. We've seen the seven sixty five kV network [indiscernible] into the Permian, then there's this other seven sixty five stuff off to the east What would be the advantages or disadvantages of doing the rest of that seven sixty five or or or three forty five. And then just contextualize what you're seeing on the growth front in Texas right now.

30m 54s

Sure. Please go ahead, Alan. You bet. Thanks, Ross. Yeah, the Texas miracle, as I've said before, continues.

31m 2s

Just from a general high level perspective, things I generally talk about when I'm talking about growth, premise growth up again 3% over quarter one last year, nineteen thousand new premise. Transmission POIs, new requests up 66%. Year to date first quarter versus last year first quarter. Total active requests up 35%. Our LC and I large customer queue continues to grow at a record pace, now up 30% of where we were last quarter over the 152,000,000 I think is what we announced last time. West Texas, Far West Texas weather zone, up 3%. New peak Culberson transmission lube up 41% over last year's peak and Stanton transmission lube up about 9%, 8.8% over last year's peak. So those are kind the metrics I generally talk about on these calls. Around growth, obviously, we've got a lot of other things going on that you mentioned. There's the the Permian plant, obviously, with the latest announcement that we're going to be doing the import pass with seven 765kV, that's a big one. And then the remainder of the STEP program, the seven sixty five plan that our and the PUC are looking at There's we've said before, we were kind of we were agnostic from a financial perspective on seven sixty five three forty five because if you don't build the seven sixty five you to build a lot more three forty five.

32m 31s

So we're going to be good either way. However, from an operational perspective, we've been very adamant that operationally seven sixty five makes a lot more sense for a state that's growing like ours. Obviously, if you build bigger capacity now on less right of ways, you have increased ability to operate your system differently and more effectively. It provides for the allowance of generation siding at pretty much anywhere you can connect to the seven sixty five as opposed to having to build three forty five directly to locations where generation is coming online. So we think there are operational benefits to seven sixty five. That's what we said at the legislature, what we said at the PUC. And we were pleased with that announcement. Now we'll have to see what happens with kind of the eastern half of the seven sixty five plan. Again, there's a decision to be made there as to how and when that will take place if the PUC and the legislature goes forwards. But obviously, as we've said before, and I think as Jeff alluded to, we have opportunities on both those plans, given the number of endpoints that we own, which is around, I think, over 1,300 now.

33m 42s

And the application of the 1938 bill which formalized the ERCOT criteria of using endpoints to determine the ownership of transmission lines. So we feel very good about the growth in We feel very good about where ERCOT and the PUC are headed with these two major transmission plans, and we think we'll be a major participant in both.

34m 4s

The only thing I would add is it's obviously a very ambitious plan. We think it's critical to support the state's future growth and I think given the endpoint that Alan just identified, we certainly expect to be in a position to build over half of the proposed investment.

34m 20s

Thanks for that Jeff and Alan as well. Just one last one for me. [indiscernible] Jeff, you highlighted in your opening comments the fit for 2025 program. Can you maybe talk about something in that program a little bit more specific like what you've achieved so far and what you might have sight line to just to give a little bit of flavor of what you're seeing there and what those programs actually entail.

34m 42s

Yeah, sure. Last year, Ross, we kicked off our Fit for 2025 campaign to improve the competitive cost structure of our company. This isn't something that's new at Sempra for those of you who have followed our company for a long period of time. We routinely go back and look for ways to reduce costs and improve productivity. What we're fundamentally trying to do, Ross, is find new and better ways to serve customers. So looking at opportunities to reduce headcount through voluntary retirement programs, We're making new investments in technology SDG and E is targeted using artificial intelligence example, in over 40% of its customer interactions in its call center, We're continuing to look at ways to basically outsource calls where we think it can be done on a cheaper basis. Look, I think part of serving customers better is working hard to improve the affordability of their services Let me just give you a quick recap of where we think we're at. In Texas today, Encore, for example, has the lowest rates among investor owned utilities. And notwithstanding their current $36,000,000,000 capital plan, Ross, they expect to remain the lowest across the five year plan. Similarly, at SoCalGas, you recall that's the largest natural gas utility platform in The United States.

35m 56s

Their bills today are in the bottom quartile nationally, and similarly at SDG and E, Ross, we have the lowest average bills among the investor owned utilities in the state. As you think about our five value creation initiatives, part of creating a more competitive cost structure is about finding better ways to be responsive to the needs of our customers And maybe before I wrap up, Caroline, you could add a few specifics that you were taking at SDG to give a little more color to Ross.

36m 24s

Sure, happy to do so. We remain laser focused on affordability for customers and we're proud that SDG and E's monthly electric delivery bills are lower for the second year in a row. But we have more work to do there.

36m 37s

Through our Fit for 25 initiative, we're driving down operating costs and improving efficiencies securing non ratepayer sources of funding like tax credits for batteries and advocating for policy changes. We applaud the governor of California issuing the executive order last year, which focuses on improving electric affordability that's highly constructive. And the order is largely focused on pass through programs that become less cost effective and does not appear to impact equity or capital deployment. SDG and E recently filed to reduce costs associated with certain energy efficiency programs that are no longer cost effective, and if approved, it gets save customers $300,000,000 And we're really happy about the use of climate credits that Karen to lower energy bills by $217 this year. Customer affordability is a top priority and we're doing everything possible to make sure that our bills are transparent, they're stable and they're affordable.

37m 36s

Thank you, Ross.

37m 38s

Thank you. Have a great rest of your morning.

37m 40s

You too.

37m 42s

Thank you. Our next question will come from Carly Davenport from Goldman Sachs. Your line is open.

37m 48s

Hi, Carly.

37m 50s

Hey, Jeff. Thanks so much for taking the questions. Maybe to start on the LNG front, just to follow-up on some of the comments in the prepared remarks. You talked about some of the macro uncertainty potentially impacting project development on Port Arthur 2. Could you just help us frame that potential impact Is that more just a potential kind of slippage, or is that anything we should think about from a structural shift in views on that project?

38m 16s

No, I would just clarify, Carly. I think we're in great shape Port Arthur Phase II. And Justin, maybe you could walk through how you're thinking about that project moving forward this year.

38m 25s

Yes. Thanks, Jeff. Hi, Carly.

38m 28s

As Karen said in prepared remarks, we are continuing to target FID in 2025. We're very pleased with the strong commercial interest in that project. The progress we're making on the development front. Those include commercial negotiations, receiving our final permits financing the projects. Karen mentioned some of the recent macro macroeconomic uncertainties. And I think for us, it's important to emphasize we're committed to managing cost risks maintaining discipline to achieve our targeted returns. And that, Carly, will take precedent over the timing of any announcements. I also just want to remind folks of the point Karen and Jeff have made the priorities reflected in Sempra's capital program are focused on growing regulated utilities, and that means we'll only take FID on a project like Port Arthur Phase two when we're comfortable it will deliver strong shareholder value.

39m 25s

Thank you, Justin.

39m 28s

Great. Thanks so much for that. That really helpful. And then maybe just a clarification on some of the comments in the prepared around the tariff exposure. I recognize there's still a degree of kind of movement there, but could you just help us frame out the potential earnings that exposure on a Sempra consolidated basis as well as just as you think about the broader capital plan over the next five years, how you think about the exposure there?

39m 55s

Yeah, I would say right from the top, I think remains a fluid environment for all industries, but I think we're good shape here and any type of impact from tariffs, I think falls well within our established guidance. Let me go through a couple of things that might be helpful. At our utilities, Carly, we remain focused on minimizing tax tariff exposure for our customers. The majority of our equipment is sourced domestically and that limits the direct impact on planned capital expenditures around 2% or 3%, To reduce that impact even further, our utilities are taking steps to diversify the supplier pool are exploring new supply sources with reduced exposure. Second, they're adding higher levels of domestically produced equipment and materials And finally, they're continuing to stock higher levels of inventory for critical materials, and Karen talked about that in her prepared remarks. Turning to Sempra Infrastructure, I think it's also a very positive story there. At ECA, LNG procurement is complete and not impacted by tariffs. At Port Arthur LNG, approximately 90% of our spend is with U. S. Suppliers and contractors Karen noted this, but we're also currently using foreign trade zones to mitigate tariff impacts.

41m 9s

And Train one steel was fully sourced domestically. I would just mention that the remaining tariff exposure for Phase one is estimated to be about 1% of CapEx. On our other development projects, we would only take FID after securing firm pricing and also mitigating any cost risks to achieve our target returns and we'll be very disciplined about that. So as we've looked at this, back in March and April and May, we feel like we're in very good shape relative to tariffs.

41m 39s

Great, appreciate all that detail. Thanks so much for the time.

41m 42s

Thank you, Carly.

41m 45s

Thank you. Our next question comes from Steve Fleishman from Wolfe. Your line is open.

41m 51s

Hi, Hi. Excuse me. I Jeff, Karen, Allen. So I wanted to maybe focus for a minute on Texas and just [indiscernible] pending Unified Tracker bill And maybe you could talk a little bit about how that would interact if at all, with your rate case filing and kind of what what kind of benefits of the bill would be relative to status quo?

42m 24s

Sure. Let me provide a couple of broader comments and then we'll come back and talk about the legislative session and specifically UTM I would think about the rate case separately. I mean, the way to think about it is they've got an authorized ROE today, Steve, of 9.7%. And there's two things that can impact lower earned ROEs. One is when you've got a higher cost structure that can be resolved in base rate review. And secondly, just ordinary regulatory lag based on how their capital track tracker mechanisms work. I think what Alan and team will try to focus on is continuing to strengthen their balance sheet by addressing both sides of that. But I'll make a quick comment and I'll pass it over to Alan, which is I talked about early on our value creation initiatives, and the first one, Steve, is this idea of investing about $13,000,000,000 this year The second component of that is we're committed to actually improving our financial returns, and that means whether it's legislative sessions in Texas, or California, or base rate reviews or regulatory filings, we're very, very focused on improving our regulatory compact. So that's kind of the framing as you think about what we might be able to accomplish in Texas legislative session as well as the base rate review.

43m 39s

But Alan, if you could, maybe provide some additional color on the legislative session, specifically UTM.

43m 45s

Sure. Yes. Thanks for the question, Steve. There's a number of bills that continue to make progress through the legislature, and obviously tracking everything from UTM to interim rates to wildfire. Capital structures. And there's still a lot of time left even though it's only a month. And there's still a lot of time for material changes to be made to all these bills. But we'll continue monitoring closely, working with all the constituents, and we'll have a better update on what actually gets through on the Q2 call Specifically, with regards to House Bill five thousand hundred and forty seven or the UTM bill. It's the most impactful potential bill for us given our large and growing capital plan. It'd give us a way to moderate the impacts of regulatory lag and improve our credit quality. We've had broad support from stakeholders and we really are appreciative of those parties who have worked with us on this bill. And while there are other bills that are out there that we'll continue to monitor work on, this one is potentially the most important to us. Generally, what it would do is it would provide a one stop kind of streamlined mechanism in lieu of the existing trackers or T TCOS, ECOS and TCRF trackers.

44m 55s

That are just that we make our adjustments with today. So, there's benefits to it. We still need approval by the Senate and it still needs to be assigned it's signed by the governor. But we'll keep working on it and hopefully it also would decrease the workload of the PC staff. So there's benefits to this bill. The rate case, as Jeff said, we're still planning on filing something in the second quarter. So I would think of those two separately right now for the reasons that Jeff described. And that's kind of where we are in the UTM and the rate case.

45m 32s

Thank you, Alan.

45m 34s

Yeah. What if you don't mind on the same kind of thematic, Jeff, one other question. California and I think on the last call, you were pretty optimistic something maybe during this year on the wildfire fund changes. Could you maybe give us your latest thoughts on any potential changes on AB ten fifty four?

46m

Yes. And I think this is a good follow on question because very similar to Texas, they've got a house Bill 145 in Texas, Steve, which we also think is important which really attempts to move the standard there from a simple negligence standard to gross negligence standard. So as you think about opportunities, whether through legislation or regulation, anything we can do to take risk out of the operating environment we're sure if our balance sheet is obviously very, very positive. For the growth story that we have underway in Texas. Your point, in California, it's very similar. Obviously, Wall Street is following the developments up and down the state relative to wildfire risk. I remain quite constructive. That here in California, the leadership is focused on the right things let me highlight a couple of points that you might find helpful. First off, I've long said that wildfire in the State of California is a societal issue. People tend to think of it narrowly as a utility issue, but it's much more important to the state from a statewide standpoint in terms of how folks go about their day to day lives here. I would applaud the governor's work He has his team, Steve, focused on three key areas.

47m 7s

The first of which is the size and durability of the wildfire fund, under AB ten fifty four second is opportunities to continue to improve the insurance environment particularly for residential homeowners And finally, there's a continued interest in looking for opportunities for regulatory reform. I would mention when we talk about wildfire, think it's always important to differentiate SDG and E, Steve. We think that they have demonstratively lower wildfire risk for three reasons. Obviously, it's a significantly smaller service territory. Second, it's a semiarid desert topography, so there's not that much fuel content. Relative to other parts of the state. And obviously since 02/2007, there have been significant amounts of funding in the neighborhood of 6,000,000,000 to $7,000,000,000 around our leadership position in wildfire science and mitigation. But if I could, Steve, I've got Caroline Winn here as the CEO of SDG and E. Caroline, perhaps she could also share your perspective from your company.

48m 8s

Sure. Hi, Steve. Yes, we're proud of the significant strides we've made in mitigating wildfire risk and our strong track record, which includes seventeen years without a utility related catastrophic wildfire. Much of our recent work was facilitated in part by the passage of AB ten fifty four and the stability that the wildfire fund has provided to the market. It seems clear to us that we need to build on the successful foundation of AB ten fifty four to extend its framework and durability, as Jeff said, The conversations that we've had up and down the state leave us confident that stakeholders understand the criticality of addressing the issue and the important role that investor owned utilities play in supporting California's growth, economic development, and the safety of the communities we serve. So yeah, absolutely agree with Jeff. I feel constructive about getting something done this year.

49m 3s

Thank you.

49m 6s

Thanks, Steve.

49m 8s

Thank you. Our next question comes from Nicholas Campanella from Barclays. Your line is open.

49m 14s

Hi, Nick. Hey, Hey, how's everything going? How's everyone doing? Thanks for taking my questions. Good.

49m 21s

Good.

49m 23s

So hey, just really quick on the EPS CAGR commentary.

49m 27s

You kind of talked about in the prepared remarks as not being linear. Understand that Encore is working through a rate case. You're working through these asset sales. But I guess just what year do you kind of think that you'd be above that 7% to 9% range? Look, I think we haven't given that level of guidance I think one of the things we realized that we got a lot of feedback from our Q4 call was there's probably an opportunity to be more clear and less ambiguous about our expectations, and obviously it was a very challenging call for us. It's something that we take very seriously, and I think what we wanted to do is make sure we were very clear eyed about what the opportunity was through 2029 so we took the opportunity to clarify for everyone that we expect to be at the high end or above that range, think some of the things, Nick, today's call provides a little bit more visibility into our confidence there. You recall that we had a $36,000,000,000 capital plan that we discussed in February for Encore. And now that you see the seven sixty five decision, now that you've seen not just the import path, not just the local paths, but the import paths at the Permian being moved back to 02/1930, Obviously, we feel quite confident that a lot of that $12,000,000,000 will come into the plan and that's currently not in our forecast of 7% to 9%.

50m 45s

So I hope that's helpful. That is. Thanks so much, Jeff. And then just a follow-up on SiP and the transaction you're pursuing here. Is there any scenario in which you think you can kind of go beyond the 30%? And then you mentioned it's accretive, which is great. So clearly, multiple should still be robust. But maybe you can kind of talk about your confidence level and just the current outlook of interest rates and tariffs and economic uncertainty potentially impacting this valuation versus where you've successfully transacted on it in the past?

51m 18s

Yeah, I would start, Nick, by some conversations you and I have had before, but I think over long periods of time, Sempra has an established track record both in acquiring assets and also in divesting assets. This is something we've been very thoughtful about with our Board of Directors. We tend to look at these types of opportunities to unlock value. Almost at every board meeting. We're always open to new ideas, I think what we've tried to do is be very thoughtful about picking a scope of transaction, a transaction boundary between 1530% that meets the needs of our capital program But really, a comment that's true of our entire portfolio is we're always open to new ideas, right? So I think we've got this thing sized correctly. But if we happen to take both a conforming bid and a non conforming bid, we would always look at that through the lens of what creates the most value for our owners.

52m 14s

All right. Thanks for taking my questions. Appreciate it. All right.

52m 17s

Thank you very much.

52m 20s

Thank you. Our next question will come from Shar Pourreza from Guggenheim Partners. Your line is open.

52m 28s

Good morning. Is actually conferencing Hey, Jeff. How are you? Good.

52m 35s

Maybe coming back to Texas for a second, the Encore CPCN app applications are already being filed for the seven projects that you highlighted. And do those enable the visibility on any of the upsides or is there potentially larger pull forward in plan? With the seven sixty five kV standard Just how does that flow versus the $12,000,000,000 of upside CapEx?

52m 55s

Yes, so let me make a couple of comments and then I'll pass it to Don or Alan to answer some follow on questions. But remember, I think that Encore in its discussions with its Board of Directors had really circled about a $48,000,000,000 opportunity between 2025 and 2029. And what we at Sempra do is, remember, we're always trying to be very disciplined about capital. The Encore team shares that same view. What we elected to do was divide that planned capital spending into two categories, a category where there was high confidence of the capital spend and they were reasonably far along in securing all the required permits or CCNs for those projects to be built. That $12,000,000,000 category, which we've always referred to as incremental, where we thought that some additional work needed to be done to make sure we firmed up our ability to commence construction permits would be an example, CCNs would be an example. So they made a lot of progress in Q1 on CCNs. And the two big things that have changed was originally the Permian plan, is going to cost 15,000,000,000 to 17,000,000,000 had two components. There was a local component that the regulator asked to be completed by 02/1930 and then there was this import component which was expected to stretch into the next decade.

54m 13s

The two things that happened is the regulator has determined that relative to that import opportunity, going to use the seven sixty five kV level of infrastructure. And number two, they now move that timeline forward, so both the local projects and the import projects have to be done by 02/1930. So that really firms up the need for Encore to move forward with much of that $12,000,000,000 incremental plan. Alan, if you could provide a little bit more color. I know your team has been very busy. In terms of filing permits and CCNs. But if you could offer some that would be helpful.

54m 50s

Jeff, I think you really covered it, as you mentioned with regards to CCNs, I think we've already filed seven. I think we're planning on filing in the mid-20s this year. Just to give a little color, I did this work as outside counsel seventeen years. I think it had 40 or 50 total in seventeen years, we're filing 24 this year. So that's somewhat of an indication of how busy we are on the regulatory front. Otherwise, think you've addressed it.

55m 13s

So, I think the key takeaway there is, of the 24 or so CEs CCNs have been filed, we filed roughly one third of them. There's more work to be done.

55m 22s

And as you mentioned, I think this would be accretive to the $12,000,000,000 that you highlighted because $12,000,000,000 based on a longer timeframe, right?

55m 30s

Yes. I would mention two things here. One is in that $12,000,000,000 what we've talked about is that the import piece now is going to have some acceleration to the 02/1930 timeframe. So I think if anything, it validates the need for the $12,000,000,000 and it may in fact, and this is a non core press release require them to go beyond the 12,000,000,000 in the five year planning period through 2029.

55m 55s

Excellent. Thanks for the clarity there. And maybe shifting to California, you started some of the filings around the incremental approval versus the GRC decision like the track three and s p four ten, some others. Right. Is upside to the base plan around the 2026 time frame and how is the cost of capital kind of layered into plan just to clarify the moving pieces on the respective upside for California.

56m 22s

Yeah, I would mention a couple of things here. One is we certainly think there's opportunities outside the GRC in terms of cost of capital. We have a really good appendix slide that you can refer to there in terms of what our filing is, but let's stick to your first topic, is opportunities outside the GRC. Some of these are in our plan and some of these are outside the plan, but it might be good just to go through kind of a listing of some of the things or categories that Caroline and her team are focused on. And Caroline, perhaps you could walk us through those.

56m 51s

Sure, Jeff. Yes. Some of those items include modernization of some of our really important compressor stations. We have those electrification investments that are supported by Senate Bill four ten that Mew mentioned We also have GRC Track two and Track three, which includes costs related to our pipeline system enhancement programs and wildfire investments. But we're also looking at increasing modernization of our systems, looking at high voltage transmission in our northern and eastern portions of our service territory as well as additional battery storage resources supporting not only overall grid reliability, but also increasingly clean energy. I think the takeaway here is we're closely working with parties on outcomes beneficial to our customers that will continue and will continue to make investments for safety and reliability.

57m 41s

And I know Constantine you raised the cost capital and I think we have a good slide on Slide 11 in the appendix that outlines what we're currently operating under versus what we've requested.

57m 52s

Excellent. And just a quick clarification on the next question. And obviously there's some sequencing for the SIT transaction. But would a constructive ROFO indication potentially shorten that twelve to eighteen month process Yes, would.

58m 7s

I would just mention that if you go back and look at the transactions that we completed in 2021 and 2022, each of those transactions following the date of an announcement of a definitive agreement took approximately six months.

58m 23s

Excellent. Appreciate that. Thanks for all. Thanks for taking the question.

58m 27s

Thank you. Thank you.

58m 31s

Our next question comes from Julien Dumoulin Smith from Jefferies. Your line is open.

58m 37s

JULIEN Hi, Julien.

58m 39s

Hey, good afternoon. Thanks, Jeff. Thanks, team.

58m 42s

Appreciate it. Just maybe to follow-up on that last question a little bit further and talk about the potential transaction here. Can you guys elaborate a little bit on how you would set expectations? I mean, you know, whether it's the KK or Adia team or or or someone else, what extent would you say, like, on valuation front, at least the level that was implied from the last transaction, is that kind of a fair baseline here that you're thinking about the extent to which they may or may not want to participate, so be it, they'll indicate. But just in a sense to establish, like, a baseline on value that you'd be willing to transact at, I mean, is there is that a fair statement? No. I might approach it a little bit differently. You recall that on our March 31 press release, we outlined the implied equity transaction values both for KKR and for Adia. And the way to think about it, Julien, is since that time period, several things have happened. Been able to successfully grow our EBITDA, number one, Number two, the amount of construction we have in progress or in flight leads to an increase in near term EBITDA.

59m 43s

And then I think there's been a significant change in the overall breadth and scope of our long term pipeline So we have a fair amount of confidence that the business is of more value today than it has been in the past. That's why you've seen us use language even in our value creation initiatives that we see this as an opportunity to highlight value and the implication being there is value that's not currently in our stock price.

1h 9s

Got it. From a multiple perspective, to say given both prospects improvement, but also significant uptick in EBITDA. But nonetheless, feel confident about it, it Yeah. I think that's a good point. I would say, obviously, this is a slightly higher interest rate environment. Which goes into that. But I think one of the things that sometimes people miss, Julian, is on the multiple itself. A lot of times you get to that higher multiple based upon how the acquiring party values the depth and scope of the pipeline of development projects are out there. So you can start off with some type of market multiple, but I think the big issue is this is a significant franchise. This is not a development company. It's not a series of projects This is a franchise that has been built over the last twenty five years. It's one that cannot be replicated. And I think the construction that's in flight and the scale and scope of the development pipeline is significant.

1h 1m 2s

Excellent. And if I could just follow-up real quickly on the I mean, do you stand on FFO to debt? Mean, where do we end the quarter or what have you on a kind of a trailing basis? And also, where do you stand with respect to Moody's today? I mean, obviously, they made their actions in the last couple of months here, how do you think about the conversation in the 15% to 30% reconciling against the needs that they've laid out for you to get back to a stable outlook? Yes. I think, Julian, as you would imagine, I think we feel like we're in pretty good shape on our credit ratings and we continue to be very committed to maintaining our credit ratings. I would also note that we have a lot of confidence in the plan that we've put in front of the agencies. And they understand that we expect to complete the transactions that you and I have been discussing transactions over the next twelve to eighteen months As part of that plan, our use of proceeds is expected to fund our capital plan in a much more efficient way than we originally proposed. I think the benefit to our shareholders is that we'll be able to reduce future common equity needs and also help to improve our credit profile.

1h 2m 4s

And with respect to our current credit metrics, the roll forward twelve month view on that is very consistent with where it was at the end of the year.

1h 2m 15s

All right. Excellent guys. Thank you very much. All right. We'll we'll chat soon.

1h 2m 18s

Alright. Thanks a lot, Julian.

1h 2m 22s

Thank you. Our next question will come from Durgesh Chhabra from Evercore ISI. Your line is open.

1h 2m 29s

Hi, Durgesh.

1h 2m 31s

Hey, Jeff.

1h 2m 32s

Good morning, Kew. Thank you for giving me time. Hey, just wanted to quickly follow-up on Julien's question related to Moody's. Is it your understanding or at least in your conversation with the team, both Moody's and S and P, who have you on negative outlook that they'll be patient here. I'm just double checking. Usually, their process is twelve to eighteen months. But just in your conversation that they'll be patient here and see through your asset sale process if it goes the full distance in eighteen months. The reason why I'm asking that question is obviously, if they're not, you may decide to issue equity sooner. Than this process. Plays out. So maybe just your thoughts thoughts on that. Yeah. I'll be very clear. We think we're in great shape here and maybe Karen you can provide additional color.

1h 3m 18s

Yes. We've had great conversations with rating agencies. We have laid out the plan, and I think they understand the twelve to eighteen month time frame we've talked about. So we're committed to our ratings, and we've had good conversations with them on this front. So we think we have the time to complete these transactions. And as Jeff mentioned, our time frame is could be shorter than that.

1h 3m 40s

Got it. Yes, I just wanted to be crystal clear. Okay, that's very helpful. And then just really quickly, hopefully, is a quick one. At least the way we're modeling the transaction is very little to no tax leakage. Is that a fair way to think about transaction proceeds?

1h 3m 56s

No, I think the way that we focus on this is making sure that we focus on key three variables. Our first obligation is to either work with our partners or run a process or get that solves for the highest possible equity value Secondly, we've had a team of folks working on the tax size side and our goal is to minimize leakage. Obviously, you're going pay taxes as part of a transaction like this, but our goal is to minimize that. That certainly has a big impact on your after tax usable proceeds. Then it's very important you look at all the different possibilities of how you could use those proceeds to maximize your accretion. That's work that we spend a lot of time on. It's been well briefed with the credit rating agencies. And we're comfortable through a range of outcomes. That we can deliver a set of transactions that are accretive to our EPS forecast and is accretive to credit.

1h 4m 48s

Got it. That's very clear. Thank you.

1h 4m 51s

Thank you.

1h 4m 54s

Thank you. Our next question comes from Anthony Crowdell from Mizuho. Your line is open.

1h 5m

Hi, Anthony.

1h 5m 1s

Hey, good afternoon team.

1h 5m 2s

Jeff, just one quick one. I think it may follow-up on Nick Campanella's train of thought. When you look out towards the end of your forecast period, four or five years, we have the encore CapEx spending You've sold down the piece of SIP You keep talking about like the growth is going to be mainly focused on the regulated utility side. Of Sempra. What's the mix of regulated utility earnings to say your infrastructure earnings towards the end of your plan?

1h 5m 32s

Yes. I really appreciate the opportunity to this. Look, I think we have been very clear over a long period of time that we're continuing to build this business with a view toward taking risk away from the portfolio, and allocating capital disproportionately to our regulated investments What we've done with our Board of Directors is target a mix where our regulated earnings and cash flows will be at the level of 90% or greater and that you'll see us have a lower ownership inside of SI accordingly. This transaction really just accelerates our movement to that So at some point in our five year plan, we're quite confident that we'll be at 90% or better in terms of an earnings mix from our regulated utilities.

1h 6m 16s

Great. That's all I had. Thanks again.

1h 6m 18s

Thank you.

1h 6m 21s

Thank you. And we do have time for one last question today. And our last question will come from David Arcaro from Morgan Stanley. Your line is open.

1h 6m 31s

Hi, David.

1h 6m 33s

Hey, thanks so much for sneaking me in. Apologies if I didn't quite catch it, but I was wondering in on CORE, just what are the gigawatts of the LC and I pipe currently and how much of that is data centers? And I'd also be just be curious, your current view on what you would consider advanced stage you know, more like realistic, to hit the market? We've just heard skepticism just around how much load it might actually show up. Yes. Look, I think this is a great question. Obviously, you've seen ERCOT's forecasts have increased A year ago, they were forecasting something closer to 152 gigawatts by the end of the decade. That's now gone up, and I think that's led to a lot of questions, concerns about how much of that might be real I think from Encore standpoint, they've had historically a peak load in their territory of around 31 or 32 gigawatts, and they have had significant interconnection requests And Alan, perhaps you or Don could just kind of highlight for us what the changes in that has been in the port part that you feel very confident in?

1h 7m 41s

You bet. Thanks, David. The direct answer to your question is we crescent presently have 156 gigawatts of data centers in the queue. And another 22 gigawatts of load from kind of more traditional diverse industrial sectors. So that is whatever one and seventy eight total of large C and I in the queue, of which one and fifty six is data centers.

1h 8m 7s

Did you want to comment on how you think about the more certainty of that once you're holding?

1h 8m 11s

Sure. I mean, I apologize, Jeff. Absolutely. I mean, so what submitted to ERCOT was about 29.5 gigawatts in our officer letter that we think we have high confidence in. And high confidence comes from a number of things, including two or more of the following execution and securitization of an agreement for things like engineering or procurement. Delivery of technical information, proof of site control, completed site related studies, attestation of non duplicative load requests, verification of financial capabilities and a payment of study fees, so things like that. Is how we get to the high confidence level. So 29.5 gigawatts of that and then we have another nine gigawatts or so of signed interconnection agreements. And the 29.5 gigawatts I should have said, is by 02/1931.

1h 9m 7s

So that's, again, as you said, Jeff, that's that's additional gigawatts on top of what is presently a 31 gigawatt peak. Yes. So think about that, David, just to kind of put that in context is, their high confidence level of interconnections more than doubles their existing peak load and they've got actually a backlog that's 5x of their current peak load. So, I think the goal here really is to make sure that we are building the critical infrastructure that continues to support the economic growth in the state. And I feel quite confident that the growth around the Encore service territory will lead the state in terms of what needs to be done from an infrastructure standpoint.

1h 9m 47s

Excellent. Perfect. Yeah. Huge numbers.

1h 9m 49s

Really appreciate the data there. I'll leave it there.

1h 9m 52s

Thank you, David.

1h 9m 54s

Thank you. That concludes today's and answer session. At this time, I'd like to turn the conference back to Jeff Martin for any additional closing remarks.

1h 10m 4s

I want to take a moment to thank everyone for joining us today. I know there are a lot of competing calls, we certainly appreciate everyone making the time to join us. If there are any follow-up items, please reach out to our IR team with your questions. I would also mention that Glenn and I are heading up to Los Angeles to meet with investors today. And Karen and the team will be looking forward to seeing many of you in Florida at the upcoming AJ event later this month. This concludes our call.

1h 10m 30s

Thank you for your participation. You may now disconnect.

Key Insights

Sempra reported strong Q1 2025 results with adjusted EPS of $1.44 (up from $1.34 YoY) and affirmed full-year 2025 adjusted EPS guidance of $4.30–$4.70, 2026 EPS guidance of $4.80–$5.30, and a projected long-term EPS CAGR of 7%–9% through 2029, targeting the high end or above.
The company is executing five value creation initiatives, including ~$13B in 2025 energy infrastructure investment (over $10B in U.S. utilities), portfolio realignment (including the sale of a minority interest in Sempra Infrastructure Partners and divestiture of ECOgas), and cost reduction via the Fit for 2025 campaign, which leverages technology and AI to improve productivity and affordability.
Sempra’s Texas utility, Oncor, is well positioned for significant growth due to ERCOT’s proposed $32–$35B transmission buildout, with Oncor expecting to construct a major portion; Oncor’s high-confidence interconnection queue now exceeds 29.5 GW (mainly data centers), more than doubling its current peak load.
In California, SDG&E and SoCalGas filed for updated cost of capital (seeking 11.25% and 11% ROE, respectively) for 2026–2028, with a CPUC decision expected by year-end; SDG&E continues to lead in wildfire mitigation and customer affordability, with recent bill credits totaling up to $217 in 2025.
Sempra Infrastructure continues to advance major projects (Cameron LNG, ECA LNG Phase 1 at 92% complete, Port Arthur LNG Phase 1), with minimal tariff exposure (<3% of utility CapEx, ~1% at Port Arthur LNG); asset sales are expected to be accretive to EPS and credit enhancing, supporting a shift to >90% regulated utility earnings mix within five years.

Recent Transcripts

FFO and NAV per share grew strongly, driven by acquisitions and active asset management.

Q1 adjusted EPS grew to $1.44; full-year and long-term EPS guidance affirmed.

Sempra lowered 2025 EPS guidance but raised long-term growth outlook to 7-9% CAGR.

Earnings

Report Date

May 8, 2025

Reported Revenue

3.8B

Miss -2.94%

Avg 1d Change

7.12%

Report Period

Q1 2025

Reported EPS

1.4

Beat +9.09%

Implied Move 1d

4.57%

Transcript

9m 53s

11m 19s

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15m 40s

With that, please turn to Slide four, where Karen will walk through business and financial updates.

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29m 5s

Good morning. How are you? Good morning, John. Good morning, Karen.

29m 8s

Good morning.

29m 10s

So just a couple of questions to touch on.

29m 13s

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30m 19s

30m 54s

Sure. Please go ahead, Alan. You bet. Thanks, Ross. Yeah, the Texas miracle, as I've said before, continues.

31m 2s

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37m 36s

Thank you, Ross.

37m 38s

Thank you. Have a great rest of your morning.

37m 40s

You too.

37m 42s

Thank you. Our next question will come from Carly Davenport from Goldman Sachs. Your line is open.

37m 48s

Hi, Carly.

37m 50s

38m 16s

No, I would just clarify, Carly. I think we're in great shape Port Arthur Phase II. And Justin, maybe you could walk through how you're thinking about that project moving forward this year.

38m 25s

Yes. Thanks, Jeff. Hi, Carly.

38m 28s

39m 25s

Thank you, Justin.

39m 28s

39m 55s

41m 9s

41m 39s

Great, appreciate all that detail. Thanks so much for the time.

41m 42s

Thank you, Carly.

41m 45s

Thank you. Our next question comes from Steve Fleishman from Wolfe. Your line is open.

41m 51s

42m 24s

43m 39s

But Alan, if you could, maybe provide some additional color on the legislative session, specifically UTM.

43m 45s

44m 55s

45m 32s

Thank you, Alan.

45m 34s

46m

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48m 8s

49m 3s

Thank you.

49m 6s

Thanks, Steve.

49m 8s

Thank you. Our next question comes from Nicholas Campanella from Barclays. Your line is open.

49m 14s

Hi, Nick. Hey, Hey, how's everything going? How's everyone doing? Thanks for taking my questions. Good.

49m 21s

Good.

49m 23s

So hey, just really quick on the EPS CAGR commentary.

49m 27s

50m 45s

51m 18s

52m 14s

All right. Thanks for taking my questions. Appreciate it. All right.

52m 17s

Thank you very much.

52m 20s

Thank you. Our next question will come from Shar Pourreza from Guggenheim Partners. Your line is open.

52m 28s

Good morning. Is actually conferencing Hey, Jeff. How are you? Good.

52m 35s

52m 55s

54m 13s

54m 50s

55m 13s

So, I think the key takeaway there is, of the 24 or so CEs CCNs have been filed, we filed roughly one third of them. There's more work to be done.

55m 22s

And as you mentioned, I think this would be accretive to the $12,000,000,000 that you highlighted because $12,000,000,000 based on a longer timeframe, right?

55m 30s

55m 55s

56m 22s

56m 51s

57m 41s

And I know Constantine you raised the cost capital and I think we have a good slide on Slide 11 in the appendix that outlines what we're currently operating under versus what we've requested.

57m 52s

58m 7s

58m 23s

Excellent. Appreciate that. Thanks for all. Thanks for taking the question.

58m 27s

Thank you. Thank you.

58m 31s

Our next question comes from Julien Dumoulin Smith from Jefferies. Your line is open.

58m 37s

JULIEN Hi, Julien.

58m 39s

Hey, good afternoon. Thanks, Jeff. Thanks, team.

58m 42s

59m 43s

1h 9s

1h 1m 2s

1h 2m 4s

And with respect to our current credit metrics, the roll forward twelve month view on that is very consistent with where it was at the end of the year.

1h 2m 15s

All right. Excellent guys. Thank you very much. All right. We'll we'll chat soon.

1h 2m 18s

Alright. Thanks a lot, Julian.

1h 2m 22s

Thank you. Our next question will come from Durgesh Chhabra from Evercore ISI. Your line is open.

1h 2m 29s

Hi, Durgesh.

1h 2m 31s

Hey, Jeff.

1h 2m 32s

1h 3m 18s

1h 3m 40s

1h 3m 56s

1h 4m 48s

Got it. That's very clear. Thank you.

1h 4m 51s

Thank you.

1h 4m 54s

Thank you. Our next question comes from Anthony Crowdell from Mizuho. Your line is open.

1h 5m

Hi, Anthony.

1h 5m 1s

Hey, good afternoon team.

1h 5m 2s

1h 5m 32s

1h 6m 16s

Great. That's all I had. Thanks again.

1h 6m 18s

Thank you.

1h 6m 21s

Thank you. And we do have time for one last question today. And our last question will come from David Arcaro from Morgan Stanley. Your line is open.

1h 6m 31s

Hi, David.

1h 6m 33s

1h 7m 41s

1h 8m 7s

Did you want to comment on how you think about the more certainty of that once you're holding?

1h 8m 11s

1h 9m 7s

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Excellent. Perfect. Yeah. Huge numbers.

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Really appreciate the data there. I'll leave it there.

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Thank you, David.

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Thank you. That concludes today's and answer session. At this time, I'd like to turn the conference back to Jeff Martin for any additional closing remarks.

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Thank you for your participation. You may now disconnect.

Key Insights

Sempra reported strong Q1 2025 results with adjusted EPS of $1.44 (up from $1.34 YoY) and affirmed full-year 2025 adjusted EPS guidance of $4.30–$4.70, 2026 EPS guidance of $4.80–$5.30, and a projected long-term EPS CAGR of 7%–9% through 2029, targeting the high end or above.
The company is executing five value creation initiatives, including ~$13B in 2025 energy infrastructure investment (over $10B in U.S. utilities), portfolio realignment (including the sale of a minority interest in Sempra Infrastructure Partners and divestiture of ECOgas), and cost reduction via the Fit for 2025 campaign, which leverages technology and AI to improve productivity and affordability.
Sempra’s Texas utility, Oncor, is well positioned for significant growth due to ERCOT’s proposed $32–$35B transmission buildout, with Oncor expecting to construct a major portion; Oncor’s high-confidence interconnection queue now exceeds 29.5 GW (mainly data centers), more than doubling its current peak load.
In California, SDG&E and SoCalGas filed for updated cost of capital (seeking 11.25% and 11% ROE, respectively) for 2026–2028, with a CPUC decision expected by year-end; SDG&E continues to lead in wildfire mitigation and customer affordability, with recent bill credits totaling up to $217 in 2025.
Sempra Infrastructure continues to advance major projects (Cameron LNG, ECA LNG Phase 1 at 92% complete, Port Arthur LNG Phase 1), with minimal tariff exposure (<3% of utility CapEx, ~1% at Port Arthur LNG); asset sales are expected to be accretive to EPS and credit enhancing, supporting a shift to >90% regulated utility earnings mix within five years.