PG&E Corp (PCG) Reports Strong Earnings Growth and Increased Guidance for 2024
GAAP Earnings: $1.05 per share for 2023, up from $0.84 in 2022.
Non-GAAP Core Earnings: $1.23 per share for 2023, an increase from $1.10 in 2022.
2024 Earnings Guidance: Raised to $1.10 to $1.14 per share for GAAP and $1.33 to $1.37 for non-GAAP core earnings.
Operating Costs: Non-fuel O&M costs reduced by 5.5% in 2023, surpassing the annual target.
Capital Plan: Five-year capital plan increased to $62 billion to support infrastructure improvements.
Equity Issuance: No equity issued in 2023 with no forecasted equity needs for 2024.
Long-Term Growth: Non-GAAP core EPS growth guidance of at least 9% extended through 2027 and 2028.
On February 22, 2024, PG&E Corp (NYSE:PCG) released its 8-K filing, announcing its financial results for the full year of 2023. The company, a holding entity for Pacific Gas and Electric, serves millions of customers in California and has been under scrutiny following its bankruptcy reorganization due to wildfire liabilities. PG&E Corp's latest earnings report reflects a company on the rebound, with increased earnings and a commitment to operational efficiency and safety.
Financial Performance and Strategic Achievements
PG&E Corp (NYSE:PCG) reported GAAP earnings of $1.05 per share for the year 2023, a significant improvement from $0.84 per share in 2022. Non-GAAP core earnings also rose to $1.23 per share from $1.10 per share in the previous year. This performance was primarily driven by increased customer capital investment and non-fuel operating and maintenance savings, which exceeded the company's annual reduction target for the second consecutive year.
The company's financial achievements are particularly important in the context of the Utilities - Regulated industry, where operational efficiency and capital investment are critical for maintaining service reliability and meeting regulatory requirements. PG&E Corp's ability to reduce non-fuel O&M costs by 5.5% while increasing its five-year capital plan to $62 billion underscores its commitment to improving its infrastructure and service quality.
Income Statement and Balance Sheet Highlights
PG&E Corp's income statement for 2023 shows a robust increase in operating revenues, totaling $24.428 billion, up from $21.680 billion in 2022. This increase is attributed to higher revenues in both electric and natural gas segments. The company managed to keep operating expenses under control, leading to an operating income of $2.671 billion, a substantial increase from $1.837 billion in the previous year.
The balance sheet reflects the company's prudent financial management, with no equity issued in 2023 and no anticipated equity needs for 2024. This is a positive sign for investors, as it suggests that PG&E Corp is capable of funding its operations and growth initiatives without diluting shareholder value.
Looking Ahead: 2024 Guidance and Long-Term Prospects
Looking forward, PG&E Corp has increased its 2024 GAAP earnings guidance to a range of $1.10 to $1.14 per share, with non-GAAP core earnings guidance also rising to $1.33 to $1.37 per share. The company's long-term outlook remains positive, with a non-GAAP core EPS growth guidance of at least 9% extended through 2027 and 2028.
PG&E Corp's CEO Patti Poppe commented on the company's progress, stating,
Our story of progress continued in 2023, including further reducing wildfire ignitions and burying more powerlines than any prior yearall while achieving overall non-fuel operating and maintenance cost savings of more than 5%. Were excited about the future were creating for our customers and investorsdifferentiating ourselves on safety and financial performance while building a system that meets the climate challenges of tomorrow."
In conclusion, PG&E Corp's latest earnings report paints a picture of a company that is successfully navigating its post-bankruptcy phase, with a clear focus on operational excellence and strategic capital allocation. The company's increased earnings guidance for 2024 and extended growth outlook signal confidence in its ability to deliver value to shareholders while maintaining a strong commitment to safety and reliability for its customers.
For more detailed information, investors and interested parties can access the full earnings report and supplemental financial information on PG&E Corporations website.
Explore the complete 8-K earnings release (here) from PG&E Corp for further details.
This article first appeared on GuruFocus.
