October 20, 2000
Edison International Third Quarter Earnings of $1.11
Reflect Impact of Midwest Acquisitions; Utility Unit's
Undercollected Power Purchase Costs Increase
Edison International (EIX) reported earnings for the third quarter of
2000 of $1.11 per share. While not reflected in reported earnings, EIX and its
utility unit, Southern California Edison (SCE), announced at the same time that
during the quarter costs of purchasing power in California's dysfunctional
markets exceeded revenues by more than $1.25 billion, upping SCE's year-to-date
regulatory undercollections for purchased power to $2.358 billion. "The
dysfunctional California wholesale power market must be fixed. It is
increasingly costing Californians billions of dollars, and poses a large risk to
the health of the California economy and the company. We urge that the
responsible state and federal officials move rapidly to fix it." said John
Bryson, Chairman and Chief Executive Officer of Edison International.
Year-to-date earnings for EIX increased to $1.81 per share from $1.52 per
share for the same period in 1999. Net income was $360 million for the quarter,
up $105 million from third quarter 1999. The increase in earnings is primarily
due to earnings contributions from investments made in 1998 and 1999, strong
operating performance at each of the major EIX subsidiaries, and the impact of
share repurchases.
Bryson also emphasized, "This quarter's earnings for the first time
reflect the large summer contribution of EME's Illinois generating facilities,
acquired last December. The Illinois plants sell their output under contract to
Commonwealth Edison. Under the contracts, all of the annual earnings from these
plants occur in the summer months. This new element in EIX's income has sharply
increased the seasonality of the company's earnings."
Quarter Ended
September 30,
Earnings Per Share 2000 1999 Change
------------------
------------------------------
Reported and Operating Basis
Southern California Edison $0.53 $0.46 $0.07
Edison Mission Energy 0.59 0.25 0.34
Edison Capital 0.11 0.10 0.01
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1.23 0.81 0.42
Edison Enterprises & parent co. (0.12) (0.07) (0.05)
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Edison International - consolidated $1.11 $0.74 $0.37
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- more -
SCE contributed earnings of 53 cents per share, an increase of seven
cents from the same period last year, primarily due to higher kilowatt-hour
sales and the impact of share repurchases. SCE continues to experience negative
margins between the costs of buying and delivering power and the prices SCE can
charge customers under California's rate freeze. These negative margins are not
reflected in reported earnings because EIX and SCE believe the amounts
ultimately will be recovered through rates. SCE is seeking approval from the
California Public Utilities Commission to recover these costs, but there is a
risk that SCE will not obtain adequate relief and will be forced to write off
the uncollected balances. A report on Form 8-K to be filed by EIX with the
Securities and Exchange Commission, describing in detail the current
circumstances, is attached to this release.
EME contributed earnings of 59 cents per share in the third quarter of
2000, up 34 cents per share from the same quarter last year. The increase at EME
was primarily attributable to earning contributions from Illinois acquisitions
in its Midwest Generation division and in the United Kingdom. The increase also
included an 11-cent contribution from the adjustment to the accrued expense in
connection with the termination of EME's phantom option plan. The increase in
earnings was partially offset by higher interest expense resulting from
increased corporate borrowings to finance acquisitions. The net income for EME
was $191 million for the third quarter versus $87 million for the same period
last year, up 121 percent.
Earnings per share from Edison Capital were 11 cents per share for the
quarter, up one cent per share from the same period last year. Higher earnings
from infrastructure investments and the sale of interests in affordable housing
investments were the primary contributors to this increase. Edison Capital's net
income was $36 million for the quarter, up $1 million, or four percent, from the
same quarter last year.
EIX's retail businesses, organized under Edison Enterprises, along with
the parent company were responsible for a 12-cent-per-share negative impact on
2000 third quarter earnings compared to a seven-cent-per-share negative impact
in 1999. The five-cent decrease in earnings is due to increased interest expense
at the parent which more than offset the improved earnings performance at Edison
Enterprises.
Year-to-date, EIX earned $1.81 per share compared to $1.52 per share for
the same period last year. The increase was primarily due to contributions from
EME's Midwest Generation division, the absence of refueling outages at the San
Onofre Generating Station (SONGS), an 11 cent contribution from the adjustment
to the accrued expense in connection with the termination of EME's phantom
option plan, and the impact of share repurchases. The increase was partially
offset by anticipated higher operating costs and interest expense at EME, and
higher interest expense at the holding company.
Year-to-date
September 30,
Earnings Per Share 2000 1999 Change
- ------------------ ----------------------------------------
Reported and Operating Basis
Southern California Edison $1.32 $0.99 $0.33
Edison Mission Energy 0.48 0.39 0.09
Edison Capital 0.34 0.31 0.03
-----------------------------------------
2.14 1.69 0.45
Edison Enterprises & parent co. (0.33) (0.17) (0.16)
-----------------------------------------
Edison International - consolidated $1.81 $1.52 $0.29
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- more -
For the twelve-month period ending September 30, 2000, EIX's earnings
per share were $2.08 compared to $1.98 for the same period last year. The
increase was primarily related to the absence of refueling outages at the SONGS.
The increase was partially offset by higher operating and interest expense at
EME, higher earnings contributions from the sale of investments in affordable
housing in the prior 12-month period as compared to the current 12-month period
at Edison Capital, and increased interest expense at the holding company.
12 Months Ended
September 30,
Earnings Per Share 2000 1999 Change
- ------------------ ----------------------------------------
Reported and Operating Basis
Southern California Edison $1.72 $1.31 $0.41
Edison Mission Energy 0.46 0.48 (0.02)
Edison Capital 0.39 0.41 (0.02)
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2.57 2.20 0.37
Edison Enterprises & parent co. (0.49) (0.22) (0.27)
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Edison International - consolidated $2.08 $1.98 $0.10
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Quarter Ended
September 30,
2000 1999 Change
-------------------------------------------
Reported Earnings ($000)
Southern California Edison $171,682 $160,106 $11,576
Edison Mission Energy 191,282 86,605 104,677
Edison Capital 35,886 34,658 1,228
Edison Enterprises & parent co. (38,699) (26,032) (12,667)
------------------------------------------
Edison International - consolidated $360,151 $255,337 $104,814
=========================================
Year-to-date
September 30,
2000 1999 Change
------------------------------------------
Reported Earnings ($000)
Southern California Edison $441,355 $342,838 $98,517
Edison Mission Energy 160,287 136,176 24,111
Edison Capital 113,004 108,798 4,206
Edison Enterprises & parent co. (107,786) (60,842) (46,944)
-----------------------------------------
Edison International - consolidated $606,860 $526,970 $79,890
=========================================
12 Months Ended
September 30,
2000 1999 Change
-------------------------------------------
Reported Earnings ($000)
Southern California Edison $582,049 $458,249 $123,800
Edison Mission Energy 154,388 167,244 (12,856)
Edison Capital 133,572 143,419 (9,847)
Edison Enterprises & parent co. (167,089) (79,390) (87,699)
------------------------------------------
Edison International - consolidated $702,920 $689,522 $13,398
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