PG&E Corporation’s (NYSE: PCG) full-year 2016 net income after dividends on preferred stock (also called “income available for common shareholders”) was $1,393 million or $2.78 per share, as reported in accordance with generally accepted accounting principles (GAAP). This compares with $874 million, or $1.79 per share, for the full year 2015. For the fourth quarter of 2016, GAAP results were $692 million, or $1.36 per share, compared with $134 million, or $0.27 per share, for the same quarter in 2015.
GAAP results include items that management does not consider part of normal, ongoing operations (items impacting comparability), which totaled $809 million pre-tax, or $0.98 per share, for the year. These items primarily included capital and expense disallowances ordered by the California Public Utilities Commission (CPUC) in Pacific Gas and Electric Company’s (Utility) 2015 Gas Transmission and Storage (GT&S) rate case, expenses related to the Butte fire, costs for work to clear pipeline rights-of-way, legal and regulatory costs related to natural gas matters and regulatory communications, and fines associated with the CPUC’s gas distribution record-keeping investigation and the Utility’s conviction in the federal criminal trial. These items were partially offset by the additional authorized revenue recorded as a result of the final phase two decision in the 2015 GT&S rate case, and probable insurance recoveries associated with Butte fire costs. For the fourth quarter alone, the additional GT&S revenues fully offset other items and increased GAAP earnings by $29 million, or $0.03 per share.
“Our focus on safety, reliability and California’s clean energy goals continues to drive major investments in our operations and infrastructure that are vital to meeting the needs of our customers in 2017 and beyond,” said PG&E Corporation Chairman and CEO Tony Earley.
Among the company’s highlights from the fourth quarter of 2016, PG&E:
- Secured California Public Utilities Commission approval to build the infrastructure to support 7,500 level 2 electric-vehicle charging stations across Northern and Central California.
- Delivered nearly 33 percent of our electricity from qualified renewable resources, four years ahead of California’s goal.
- Completed a successful technology demonstration project to explore the performance of battery storage systems participating in California’s electricity markets.
- Announced the second phase of the BMW ChargeForward program to test the ability of electric vehicles to support the electric grid and integrate renewable energy through smart charging.
Earnings from operations
On a non-GAAP basis, excluding items impacting comparability, PG&E Corporation’s earnings from operations in 2016 were $1,884 million, or $3.76 per share, compared with $1,519 million, or $3.12 per share, in 2015. For the fourth quarter of 2016, earnings from operations were $675 million, or $1.33 per share, compared with $247 million, or $0.50 per share, during the same period in 2015.
The increase in quarter-over-quarter earnings from operations reflected additional authorized revenue as a result of the 2015 GT&S rate case, timing-related tax items, the impact of a nuclear refueling outage in the prior period, and growth in rate base earnings.
PG&E Corporation is adjusting 2017 guidance for projected GAAP earnings in the range of $3.48 to $3.77 per share, which includes forecasts for the revenue adjustment authorized in the 2015 GT&S rate case, pipeline-related costs, legal and regulatory expenses, penalties imposed by the CPUC, as well as other items. On a non-GAAP basis, the guidance range for projected 2017 earnings from operations is $3.55 to $3.75 per share.
Guidance is based on various assumptions and forecasts, including those relating to future authorized revenues, expenses, capital expenditures, rate base, equity issuances, and certain other factors. PG&E Corporation discloses historical financial results and provides guidance based on “earnings from operations” in order to provide a measure that allows investors to compare the underlying financial performance of the business from one period to another, exclusive of items impacting comparability. See the accompanying tables for a reconciliation of earnings from operations to consolidated income available for common shareholders.
Supplemental financial information
In addition to the financial information accompanying this release, presentation slides for today’s conference call with the financial community have been furnished to the Securities and Exchange Commission (SEC) and are available on PG&E Corporation’s website at: http://investor.pgecorp.com/financials/quarterly-earnings-reports/default.aspx.
Email Currents at Currents@pge.com.