Sempra (SRE) Reports Solid 2023 Financial Results with Capital Plan Increase and Dividend Growth
Annual Earnings: Reported GAAP earnings of $3.03 billion, or $4.79 per diluted share in 2023, up from $2.09 billion, or $3.31 per diluted share in 2022.
Adjusted Earnings: Adjusted earnings remained stable at $2.92 billion, or $4.61 per diluted share for both 2023 and 2022.
Quarterly Earnings: Fourth-quarter GAAP earnings of $737 million, or $1.16 per diluted share, compared to $438 million, or $0.69 per diluted share in the prior year.
Capital Plan: Announced a 20% increase in the capital plan to $48 billion, with over 90% of investments focused on Sempra California and Sempra Texas.
Dividend Growth: Raised the annualized common stock dividend for the 14th consecutive year to $2.48 per share, up from $2.38 per share in 2023.
Earnings Guidance: Narrowed full-year 2024 EPS guidance range to $4.60 to $4.90 and issued full-year 2025 EPS guidance range of $4.90 to $5.25.
Long-Term Growth: Affirmed a projected long-term EPS growth rate of approximately 6-8%.
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On February 27, 2024, Sempra (NYSE:SRE) released its 8-K filing, detailing its financial and business results for the year ended December 31, 2023. Sempra, a leading North American energy infrastructure company, serves a vast customer base through its utilities and owns a significant stake in Oncor, a Texas-based transmission and distribution business. The company's infrastructure division operates LNG facilities and energy infrastructure in Mexico.
Financial Performance and Strategic Growth
Sempra's financial results for 2023 demonstrate a solid performance with significant growth in GAAP earnings. The company's adjusted earnings remained consistent year-over-year, reflecting stability in its operations. Sempra's capital plan expansion is a response to the growing demand for safer, more reliable, and cleaner energy, particularly in its core markets of California and Texas.
The increased capital investment is expected to enhance the company's infrastructure and support long-term value creation. The consistent dividend growth underscores Sempra's commitment to providing shareholder value, while the earnings guidance for the upcoming years indicates confidence in the company's growth trajectory.
Operational Highlights and Future Outlook
In 2023, Sempra invested $4.6 billion in capital projects within California, including significant advancements in battery storage and microgrid installations. The company's Texas operations saw a 12% rate base growth, with substantial investments in transmission projects to meet customer demand. Sempra Infrastructure's performance was robust, with efficient operations at Cameron LNG Phase 1 and progress on other LNG projects.
Looking ahead, Sempra's narrowed EPS guidance for 2024 and the new guidance for 2025 reflect a positive outlook and a commitment to sustained growth. The affirmation of the 6-8% long-term EPS growth rate further reinforces the company's strategic direction and operational excellence.
Financial Statements Analysis
Reviewing the consolidated statements of operations, Sempra's total revenues increased from $14.439 billion in 2022 to $16.720 billion in 2023. The company managed to control its expenses, with a notable increase in net income attributable to common shares from $2.094 billion in 2022 to $3.030 billion in 2023. The balance sheet shows a healthy financial position with total assets growing from $78.574 billion in 2022 to $87.181 billion in 2023.
These financial metrics are crucial for investors as they provide insights into the company's profitability, operational efficiency, and growth potential. Sempra's ability to increase revenues while controlling costs is indicative of effective management and a strong business model, particularly in the regulated utilities industry.
In conclusion, Sempra's 2023 financial results reflect a company that is successfully navigating the complexities of the energy sector, with strategic investments that are expected to yield long-term benefits. The company's focus on infrastructure growth, coupled with a commitment to shareholder returns, positions it favorably for future success.
For more detailed information and to view the full earnings report, please visit the Sempra 8-K filing.
Explore the complete 8-K earnings release (here) from Sempra for further details.
This article first appeared on GuruFocus.
