PCG - Earnings call transcript Q2 2020 | Pacific Gas & Electric Co.

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Operator

Ladies and gentlemen, thank you for standing by and welcome to the PG&E Corporation Second Quarter 2020 Earnings Release Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. [Operator Instructions] I would now like to hand the conference over to your speaker today, Chris Foster, Vice President, Treasury and Investor Relations, PG&E Corporation. you. Thank ahead. go Please

Chris Foster

And joining those us. Stephanie. the you phone, for thanks you, of to on Thank

today statements available and and Jason Law joining Strategy Policy Before Smith, financial remind discussion Management. and us I turn results, CFO. want include Executive I this it on assumptions, forecasts, to to you over Simon, which are that for our outlook about to President expectations, based morning Bill will future Executive Vice President forward-looking Vice Wells, information currently Also are John our and

affect Some in of be found the GAAP the today's presentation. important Company's with page the along second online also financial factors second described and information that reconciliation are presentation and earnings at non-GAAP investor.pgecorp.com. call could The measures results could of other quarter actual the includes between

our there to over today. SEC on encourage XX-Q. appears that to discussion review XX-Q also I'll the Annual XXXX Bill. With the And quarterly We with that, was it earlier on hand Report that and the report Form in factors filed risk you Form of

Bill Smith

Thanks, Chris, everyone. morning and good

either in we're are regulatory emergence to as We return traditional and our Today's or share major our marks company the emerged approved stronger are to a settled. are a coming us resolved for cases our matters to call post years. the now vision milestone bankruptcy for format. We've excited excited from revenues legal complex establishing

the get regulatory to for our plan and financial also path enables growth have line years, company three back We the displays next on to good grade. sight for framework a investment of strong a a

made plan will preparations matters. quarterly Jason, will the financial wildfire updated ahead and our progress financials, results. I will of update focus on including governance, through guidance, today regulatory on remarks season. the walk key cover then on kind the an of XXXX changes with on conclude we Our wildfire

put never recent we to we those for a in in changes building catastrophic to Company. time, set communities impacts on who place in the the improved now We've we've their will the foundation forget many of wildfires and bankruptcy. result lost same years. lives as an focus turns serve the Our the At

is do trust operational well safety changes and by responsive delivering customer focusing to customers reduction, and Organizational Our on and risk are of our rebuild already help excellence. mandate focus the to this mandate that while service deliver system investments We'll on reliability. underway. on

on Directors First, XX at were chosen carefully level based suited at skills years for and to start backgrounds are and were a directors new their ceded month. this come. the our Board to individual These the of Company [indiscernible] well

leadership programs will and delighted and the be future soon. Francisco team a hires. couple our Chief CIO say to Singh the our our both development Officer. external to build Sumeet through the as And Risk their evaluate Officer and to team Safety initial announcing our a additions at we'll Company their we've contributions as to changes had for announced our point a PG&E. is process With among inflection next I is of the for want to We've to and that emergence of thank each XX, is priorities leaders this permanent natural that from hire Chapter One Board recent CEO them ongoing. ranks as A internal recent Chief and I'm our all of roles Benavides, continue include to

execute place improvement seasoned process. suited bankruptcy that our is to the on developed plans a have in team well We operational during

it. And to have the to bench to their experience capabilities consistently lean take wildfire will wildfire safe. necessary and evolved our will For members deepen manage extensive and add others team that improved This core will we on efforts achieved our example, through season wildfire goals the tools confidence in mitigation customers during successfully this our place. last that I operations keep year. the has team the steps and the manage our remain electronic each evolving our group

key reduce goals term program stand If cover continue well First, touch also few ready nature, wildfire or we to you our to evolution. understand plan go we four progressing in to of assets touch status. continue targets; when safety off mitigation the Slide work of I I'll X, risk. of weather Knowing themselves. public the program better conditions wildfire a our our present our to see a areas power can PSPS on extreme are presentation, I'll deploy some I'll preparedness plan operational our on you longer on front; shut-off and showcase number to on shut will power we're Then the technology,

installation work year's mitigation We is resolve of HD weather the fully So, some work due on stages those this the all to track targets. with let's progress to the program We issues on XXXX cameras. these plan in which slowed had chain expect our goals. behind meet numbers, our COVID-XX annual stations issues of start early in and supply on to meet

inspections we're working images advanced Turning will work, enormous visualization to in of new inspection programmable and million do. advanced evaluating consistency utilizing we've a country's assets. with one analytics enhanced to making X.X X, we're efficiency This most add how see to dataset We've companies, technology to of the On likely of that ensure inspection migrate investments our you'll greater from our we're foundational collected of the predictive snapshot another we maintenance also Slide excited flight about. drone partnership we're tools. started data the year options

to and photos. of deploy We analysis. computer inspection the the consistency models are asset compile quality learning machine This improves to utilizing tools vision

and as by ago. assets we're knowing back examples consistently leakage data. different our Stepping methane early these better technologies stage this part improving business with is a of of we gas our the and range technology with our All evaluating adopted years did records much

state. Clean front. in taken partnership We fortunate years the risk these companies on approach working be this reduce our are We've to will that Energy for technologies wildfire California-based with emerging on

breaking that. other that one world's just of Tesla the It's aspect on another and program. Our I'll with of one give on the we're battery is announcement PSPS ground that update X. mitigation an storage here covered There program wildfire energy largest our example on on, that's systems is Slide just yesterday of

will we're will of modeling make for working these to as events conditions factors models. years double have make our using As new smaller, and wind fuel warrant that on programs prior we PSPS team impact purposes. will data other customers, smarter. safety feeding continually speed, minimize conditions include of we and our to the PSPS shutoffs when our shorter evaluate in taken hard program humidity We've be implement whether smarter, granularity levels, power moisture the steps the the To our public

which circuits considered team now the the improved impacted. for forecast insights to improved Our being accuracy The use ultimately result should customers are of inform shutoff. in will fewer

number by smaller to improve in we megawatt of customer expected Our be restoration critical PSPS it allow will daylight probability order community to to additional to safe a address generation, last footprint cameras customers we to these program able is These pre-positioning, one-third. elements the make are outage. shorter, areas the us of advances, about that season. XXX have needs and the meet goal allow the high to ability devices combination, next priority infrared aircraft, the this, of fixed-wing Patrol temporary This to make in nearly were will both impacted to We've by are to at by an faster In inspections our secondary meet helicopters keep so. our goal places through do installed it's of achieve using this limited be increased power health our reduce unlike XX outages evening, to controls us facilities. our also our over strategically August, where midfielder to into Aerial XXX locations solutions plan XXXX In XX% the experienced more customer time and where hours. to a on by order devices post sectionalizing of substations, XXX and of in we've greatly conduct as our end placed year abilities

clarity the improved regulatory our on few company mentioned has foundation improved touch earlier As the I'll part a I those. of key of for on financial cases,

the we I'll case of back is some million Roughly to spend and recommended. storage which disallowance was recovery. Salt subject and would cover $XXX previous transmission that at gas we're capital CPUC, updates on audit, rate looking no completed May our overspent First, to in

authorized are QX of in We to now [indiscernible] we XXXX. of anticipate seek that that on and recovery a filing decision

the expect our Commission scoping December. at procedural was schedule this securitization middle end As In pointing general a released we decision by November. an the the a reminder, hearings Commission, updated recently all-party the settlement memo of we've week of by and case, reached rate in XXXX filing of to final our the

the start around we this year. would XQ Given resolution anticipate update, of next

in that to fund. certificate We renewed XXXX AB safety are each access required have year to wildfire our order

Our request review is valid while our certificate XXXX underway. the safety is certification last and for with Commission currently from year the review is

to in Moving owner and timing national I'd workforce of our the larger know and challenges, potential issues of resolution. mention XX backdrop touching we case, discussions. on we our broader our close currently that impacts. face customers in I'll the are settlement are be COVID-XX other given employees transmission FERC do to discussions. not the But And remiss of by part not

state uptick in cases by make COVID-XX. in has challenges in reported we COVID to headway in May. created the protect what the second California even spread, further measures reinstituting to against compared continue we quarter resulted While with recent the The in to

gas we've versus from and basis mid-May in core a seen weather a electric load X% During in reduction July, on a reduction the load adjusted to XXXX. period X%

COVID -- asset to offset impacts recorded experienced These high regulatory by in often costs. We track have Memorandum also was created to related Account a there cost XQ. been that have

reduction, operating frontline to reliability execute to Electric my on current who our and I all appreciation Systems. across want employees a of second and express our for safety PG&E challenge the risk Gas Given continue programs environment, take to

the also and is around diversity in Our broader discussion workforce inclusion. engaged

a base serve We to are fortunate with extreme customer diversity.

cover As [Technical weather employees attrition [Technical a hires With very in investing Difficulty] in has and a our maintain eight conversation supplier company Jason spend. will overall that to diversity, we're consecutive turn Difficulty] of XX% our over including [Technical financials. the our on history a of this Difficulty] and over with maintains still it of focused bankruptcy years rate, low to that and I'll we

Jason Wells

plan three are which on everyone. and good here on summary covering Bill I items, you, financial X. highlighted of some on Slide morning the Thank

of a rate our order due some million. benefit to Chapter longer We XXXX, wildfire included at earning to and I'll detail -- latter forecast wildfire under impacting our the First, billion note of does the now cost traditional, regulatory slightly in look was base emergence provided there in format clarity resulting given the than the and of of Chapter have year. item non-GAAP lastly, you is Stepping return-on-equity as the Now the XX our of as provided equity -- One level audit mitigation $X.X impact earnings growth, and the the CapEx -- the GAAP in at assumptions XXXX. traditional cover greater provide timeline earnings for for -- key -- proceedings. of earnings earning assumption AB briefly from Slide not base well our roughly CapEx results that basic of view rate our XX which X% core amount the results is rate from growing -- and for also -- for We to recovery rate back the quarter. to is X. -- no from more reflective from as potential anticipated for but a to -- resolution and past. in case emergence. plan on a a spend We've capital We've that fund

not However, rate included in projections. this amount these base is

earnings our to elements. guidance Moving

First, core earnings share per for we are XXXX. updating guidance earnings

updating core earnings anticipated needs $X.XX $XXX of earnings the a non-GAAP core outstanding shares potential on have -- We to for we -- and factors $X share we for X.XX full-year. billion equity per XX -- last levels reflects anticipated and non-GAAP guidance earnings updated core reflect share earnings quarter. earnings translates XXXX starting with based XXXX. of if for Second, full-year. do count our to of our provided That to This $X.XX billion per approximately that million the the roughly about Slide a now go non-GAAP into we average share guidance, tightening

below adjusting authorized. the also are of additional range primarily up are range spend narrowing the the above authorized net of earnings both million. components on under $XXX expense and And We our that on wildfire we line spend reflects

from results of and the the forecast a to be in range midpoint XXXX financing the Keep interest of that Second, earnings six unrecoverable outstanding interest over months as are and the the six with increased of the shares of year. exit consistent our will for mind impacting year. months expense for prior factors $XXX expense million impact such last in some our remaining

guidance our with decision year, Additionally, in all-party assumes a the the consistent final GRC this XXXX settlement.

Moving a that like to are number I'd non-core There update to of guidance. earnings elements here.

an to million up range billion, of to the reflects First, to a updated value costs billion fees equity And share proceeding. the XX Trust. [Technical for deferred the for total Victims we the $X.XX the reduction and [Technical backs Chapter of billion, contributed have legal which Difficulty] $XXX $X.X a professional of charge for of Difficulty] range total the Fire equity for service $X.XX

uncertainty and a the in of amount wildfire the and remedies has investigation OII. Second, -- updated due reflect portion cost small Locate Mark tax recovery the million to to for the and the been deductibility $XXX of

amortization for Third end PG&E's also my restoration A notice an $XXX and contribution recorded Fire debt. of assume write-off decreased the is remarks. fire. accounting quarter. decision for the asset $XX decision historical the the low transmission million Fourth pickup the has approving a an recovery. accounting audit recognition GT&S the receivable we've and for of prepared to expense discuss charge recovery recognizing provided XXXX cost return wildfire for the the final million the life cost of in of we The last insurance Cal due asset final of any recovery finally, now identifying recently I'll increase of fund that associated reflects ability a cause regulatory by as for the roughly in further trust, for received. provided that in range equity historical costs media Capital. depreciation with regulatory updated limit associated to reflects anticipated associated the The that of of And the XXXX is We've the line Kincade the rules the until the reflecting successful

earnings included factors to return-on-equity, non-GAAP our Moving to disclosure under-earning made the in our resulting XXXX forecasted in an March core progress relative we our on earnings addressing state. allowed factors to increase forecast have in contributing Slide XX, the

levels to This this our estimate in guidance disclosure million million earnings are $XXX million $XXX results levels, initiating a $X.X above non-GAAP reflecting below in more roughly this $XX in earnings interest net $XXX and our We million XXXX $XXX million the authorized authorized Comparing of core line between to to to is range than unrecoverable March up below authorized an billion. update statement. for expense. $XXX $X.X to in previous million to billion range of the spend

execution experience that a the sight to including earnings range efficient exit full of and our and result, line have a more few of unrecoverable of first interest non-GAAP next of a some areas per lower $X.XX. this the statement initial repairs relative as to on translates in is third-party improvements $X.XX costs renegotiated contracts of We dilution to inspection result disclosure year. system our in financing we'll year core into the our electric share XXXX from will

million providing amortization incorporates $XXX for XXXX XXXX $X.XX update of Bill $XX billion, we Non-core the about inception with year. million equity in capital at deferred to for addition cost which charge cost of of $XX of fund the needs decision securitization final the quarter. audit Our around $XXX one-time that remedies same are investigation wildfire return a on as our expect application guidance contingent bankruptcy XXXX the next given of equity in includes next an recovery approved the and successful to approval potential We're securitization pickup, legal $XX of the upfront XXXX million, first of of securitization contribution earnings assumptions guidance GT&S the related application earlier. million mentioned the also to and million the our on year CPUC and

committed we roughly net statement, million. to our paying disclosure slight quarter. $X.X and impact range the beyond from earlier would a that ratings investment-grade with in in includes I in not and we that across this are reaffirm accrual While range needs the and reduction, an lowering consistent to also this holding March are projecting. the anticipated between improved reduction are XXXX XXXX have for like also I we five-year remain equity do Kincade factors enterprise fire need equity plan. earnings CapEx, the There million company we $XXX few achieving projected and down XXXX any our contribute to $XXX our including referenced a to debt billion This overall

Additionally, vesting could of equity cost that assets non-core this certain more additional lower we equity end revised the proceeds, of it effectively continue generate would us enable of to to pursue the range. issuing trend than

Slide XX, confidence roughly earnings interest X% growth, a unrecoverable we XXXX as mentioned to will we that outpaced will by down rate years to reflect Turning rate growth that be have base subsequent I and growth and continue earlier base continue costs. pay to

As we along reduced also fires a work traditional has we good execution, mitigate risk season. efforts start head of on far Bill operational our fire as or thus into plans are the covered to been financial making the with operational

participating wildfire XXXX $X roughly fund contribution. our the now AB in having made billion are We fully

a prudent manager As disallowance a the liability regulatory in reminder and as participants in applies. cap framework place fund the is new

we've how be value to made reflecting reflected regulatory billion, second total contribution of of discounted our payments the the a in to $X.X been terms recorded has In financial statements, this fund. quarter wildfire liability the of

estimated coverage period the from of Chapter to historical total In reflecting than a previous expected the $X.X from time is to of expense which with of The of we mitigation billion contribution based wildfire amortized wildfire XX. we assets reflect an prior emergence programs. recorded partial life resulted XX-years, expenses had in fund for relevant amortization longer adjustment under addition, state's the collective our difference to an life data the the model effectiveness this XX-years, change of the better on a

coverage July XXXX up our up for liability million component in coverage, non-wildfire liability wildfire $XXX establish for wildfire runs cost August of provides The overall liability new is coverage million. slightly total than through XXXX, $XXX insurance period. million to more insurance insurance roughly also $XXX from provides The We billion. The to in this the which $X.X events. total

We will and coverage come. same for to continue pursue additional to the period weeks policy insurance

all recovery our either seek included this in balancing for settlement associated proposed premiums the will coverage, We rate the XXXX Account through two-way with tracking case mechanism. or through account Expense general Memorandum Wildfire existing pending

also to earnings Now second transition at for including the came with with XXXX core per XX, second forecast. is our shown the here. $X.X largely and financial guidance I consistent results. Slide quarter. The items like to the share our are Non-GAAP mentioned. consistent are items discussion quarter results GAAP disclosure of would shows I non-core the non-core earnings, full-year statement in

comments XX core corresponding taxes. this on out. fronts, debt decision as $X.XX this way non-GAAP mitigation GRC rate to our interest clarity a number well just wildfire quarter base These in and were no echo of quarter-over-quarter of partially call comparison costs of year to an payables governance the today. us standpoint. exceeded of from the our Slide year and XXXX by in as the per increase at The operations start timing financial and on in of well To last that have last offset and I positions authorized shows earnings earnings close very growth year. of prepetition Bill's a with cost we share the The costs levels. want on $X.XX short-term second the and in drivers Moving primary related

which be temporary total Even return-on-equity earning the We rate are for case dividend, authorized in line X% of up lastly questions. expense see our see unrecoverable When grows roughly of And focused earnings exceeds suspension growth on with five-year our return. competitive plans. XXXX. having base interest Chapter in combined, we growth, provided. on Open financial operational a you at our we XX the plan can rate our that XX% the a

Operator

question Your Instructions] Wolfe [Operator Research. go Steve first comes Fleishman Please with ahead. from

Steve Fleishman

Yes, and doing… all morning thanks. good Hi, to back, nice have you

Bill Smith

Morning Good Steve.

Steve Fleishman

just just and… not you're track questions just preparation. of not. or how the couple the that of with on wildfire kind it's categories much A how based full-year those on The Could operational looking progressing you're you're on year you

Bill Smith

Steve, be I'd do to this glad is Bill. that.

completed a on chart with Starting We a couple on factories target target. issues target assembly on related cases little plan to those closed mentioned some HD some had of things I everything as temporarily are on that were to all -- of we're really at the we on nature. were ahead weather be -- cameras, a of the in But, some by get that of and down impacted that and stations of are in were bit we delay. these

ahead where on are we example XX%. we're target -- for we're of that management, the going So by running about veg actually temporary overshoot to generation, on

got well. delayed very were items on. doing early in recovery a little the we're a We've So Overall, place. two that plan bit

getting So about executed of very program solid as this we feel scheduled. all

Steve Fleishman

just of on the Utility, And the Okay. any then comment CEO. departure

Bill Smith

situated emergence generation of expected with we No, an bringing we're lot I during leaders this times the think is situation the a have it's what's I and actively and in for we're team in like next PG&E. leadership the on going reevaluate think, new people this, of not so an place

all we're So, set.

Steve Fleishman

there. -- worst just of some just for -- then think but you other change the about dramatically Sumeet you case And securities. I do the great. securitization be Okay, just little alternatives give And and bit of thinking it or could is maybe assumptions, things would kind the on color reason it a have XXXX in

Jason Wells

so. to Steve, Jason. this is happy do Sure,

-- to plan financing approve securitization approved confidence of the be there approved, as it billion asked a securitization support, -- -- the extension by I not strong and public reorganization. the the We debt be when our of a in asked we While measure securitization part think was we we in see would a was did XXXX beyond. application would of mean of the fallback if the would interest being improved. structure it to CPUC that said debt of he I in to $X governor application securitization best in that that the as have with is the that say temporary unrecoverable associated that one capital not for incremental I the application risk event billion $X application. waiver so on impact approved, from statement

Steve Fleishman

apologize, I the treat Trust release trust one And And mentioned Okay. it. have Could the what kind on the Victim you that discussion I a discussion that. that in of you that means? question, grantor just you last of give a of in interpret little Fire maybe terms how bit how to punchline

Bill Smith

Sure.

prepared took Fire associated as remarks, billion. As I that charge quarter this value originally stock my Victims deferred We Trust. asset recorded in with to asset $X.XX the issued had the on we tax mentioned million reduce based a of settlement the the to $XXX we --

pursuing that essentially would around to couple and us in billion then -- of -- tax to to Trust, as be we at assume There stock our -- different recognize technical a original deduction. tax deferred value attributed to so however, cross-election the the the trust. the to to deduction recognized likely assumes the expect on is we time are fund are larger time, is deduct that settlement trust the we'd qualified a tax reduction -- deduction we the us of that and for that is a stock Fire a Victim which end clarity on but that election asset it over of of tax convert it issued calendar maintain to the that reduction based increases the the year. At grant value are result would the a value actually allow stock the that sold, allows that As the of when asset

Steve Fleishman

very all Appreciate questions. you thank Okay, much.

Operator

next comes go Stanley, ahead. Stephen Your Byrd please from question Morgan with

Stephen Byrd

Hi, good morning.

Bill Smith

Stephen. Morning, Good

Stephen Byrd

Thanks for that a topics. thorough on of lot really update

Just guess my here. a couple end. items I from of

amount cost seeing out wildfire of days. insurance in What's you're Just that of magnitude of generally I coverage. of just the these in the cost availability of just terms sort sense in general cost terms that. the commentary was you curious, and your of of laid in of terms

Bill Smith

No, to mean in mentioned well, fact we are insurance that we've liability of the market certainly as and costs, a the increase tightening loss the of falls capacity provides significant in on inverse and sort XXXX utility's, seeing sort first the seen market of financial stability significant insurers that a still result liability AB tightening dollar applies in I that million, to significant $XXX a several wildfire which total higher going costs and insurance cost what of as forward. $XXX of insurance were liability what liability years we of over ongoing will think of sort in it's increase at doing be at relates claims. obviously program reflective of The ago I trend an it

Stephen Byrd

procurement, mind where now your estate or opportunities? are could safety, reduced sort that just could thorough whole business across review be but a then is a you and real re-emerged risk, a you've again, lot cost of sort that related be monetized do look broadly, thinking that to optimization kind at business there but of areas just, estate I that entire looking just either thinking in helpful. and -- not whether to about terms wildfire the in guess That's for the such Understood. how back, optimization the you And be footprint, then is PG&E other real I not of I'm more more when potential about at there overall operating a guess, across owned of stepping related looking costs, go here's just

Bill Smith

Yes, for question. Stephen. Thanks the

there are think pretty I extensive of opportunities the for company. available

of as and electric we gas continue affordability to service cognizant our systems. maintaining particularly in of invest We our are the significantly

out on also also that include an improvement I that things with touched couple level you've years think that west around renewable you've annually suppliers, work third-party of think the our third-party the included contracts underutilized on estate that we incentivize I to come on touched forefront last our programs of significant that as attract of are over number significant spend selling real contracts include we crews premiums and start our that's selling of system, about is billion of to a credits. that work into enter another to optimization to cost has at the wildfire on opportunity work energy could to a you the needed couple $XX was accelerate the and of company on the like those spent our mentioned assets, system. excess had see opportunity for there was

work third-party inspection over-time, order plans seen of the is cost to for the suppliers we we vegetation However, our bring related redesign, over of in of and a work of on third-party look that good work There focus programs and the into our that the redesign structure sort those season to coming an suppliers is company to term capabilities, so, our management but are grow to continuing some bundling we upcoming with to on will in we've the is what now of forward sort are doing our examples couple process with committing rest, couple and elements. years. management opportunity really fire longer down

Operator

Research. You're Jonathan Please ahead. comes go Arnold from next question with Vertical

Jonathan Arnold

everyone. morning, Good

Bill Smith

morning Jonathan. Good

Jonathan Arnold

a separate announcement be on It announce could Co-CEO. mentioned what having leadership the of to on topic stand the but also CIO you a And just think I time of of do and reminder the then that question? on just that any anticipate you and on soon, timing CEO for as a going Governance where search sort you new can still frame I you sense Utility you process ask is, likely the would were be

Bill Smith

there we for someone fortunately, is we're no in the to Sure. is -- but so The have place the flexibility is in by Thanks target permanent leadership in of long as be getting that to The launch need year deadline as Bill. process the end that the This search role is team the to as the the I that generation fully and for flows. of -- question. looking is role speak, underway. be, CEO get for being next really

can their plan forward. So, that start team executing going

what's to most and that important place individual our it's still is So the that person. the the But year finding reasonable we right end think that's by of target. have in

but item. requirement in imposing Utility of are the been more the I and head. Officer. President bit little keep honor requirements it's that a it to some per lot separation the confusing it to between if on think CEO the will there's between go a a title, think number for I to some is been separation about regard of the more of a to think we'll will you That So, Corporation the sense, constituents seems Utility nothing obviously make more to of the and be back a Operating with the it with had to there se, those. don't President There With have a I particular the likely artificially way Utility. Utility to think corporation CEO continue dual years a Chief and deadline

Jonathan Arnold

if presumably, that take sort Bill. it being should this Great, thank the on question you, you or doing the equity other pay might didn't equity as issuances in statement slower, today little what not XXXX we disclosure one a I of down do on to. still about plan like And price the equity that is statement piece the choose for might Matt talked that more you're one also with potential a then you you possible you you debt definitive to but the possibility, if believe on just

Jason Wells

is I we for do the think thanks I Jonathan, retain Right. as we needs. flexibility question. equity look at, that mean, there

revised million mentioned to that first the I to a million clarify me things of application. that's contingent $XXX couple Let equity on that securitization range he $XXX

opportunity had well forecast in of generate sort that equity the a contingent sort also given to have improvements flows some as timing been We need. and earnings as reduction an able cash have of

with mentioned, pay sort you around As range divestiture owner investment down, end to us natural exploring ratings. sheet want of committed that certain and of so balance sort that the non-core are and our of also company of grade assets to debt we I I also We that achieving the health improving do lower an point timing opportunity a then the reiterate to the into also some I raised. has credit but would mentioned the have are we holding more and flexibility of bring

general in next if securitization anticipate, range issued the equity would is I application so year. And that

Operator

Your next go with comes question ahead. Citi. Please from [indiscernible]

Unidentified Analyst

morning. Good

Jason Wells

morning. Good

Unidentified Analyst

$XXX the million of insurance. terms In

or I think around potential call potential you'd here? what in would your you we be new prepared wildfires to operator that mentioned further remarks, the to get as expand closer

Bill Smith

that still there we're we goal -- is Yes, level, it's a Difficulty] that this will pursuing. our -- the try market I think pursue still there with currently billion full are be policies, transfer call and additional [ph] the the is under market XXXX as different to risk in conducting to [Technical achieve number of prescribed some some is that we I in would we're for say, so continuing AB but that to capacity think

Unidentified Analyst

there the asset issuance drivers in the within of any the for you be as where key then securitization? assumption other are And beyond of 'XX sales, may range terms

Bill Smith

that it's No, really some would the of it the sort to the non-core drive range call flow to I the that improved bring of that earnings forecast equity reduction we that really in assets provided. range the cash mentioned of -- us us of lower some benefits I end disposition

Operator

comes from Goldman Lapides question go Sachs. Please Next with ahead. Michael

Michael Lapides

Thank guys, taking you for question. Hey my

of obviously over you, curious, has company upper or holding years, especially been life two Jason XX debt. just last in put XX which All can over hectic the the talk months, the you've about the

of to years next now three around it path I couple Can short-term was a the from want those of us you think what billion. And the balances $X So walk two temporary be there. over how -- the billion. then you $X.X you debt get and through or years

John Simon

State had call that roughly respect reinstate dividend again. emergence. holding the a achieved part that's With of back about of until committed on Great plan we stock to debt earnings Michael. we to three core be years the billion our California as post not would of we non-GAAP common company Thanks, formal reorganization of our to $X.X earnings,

pay And retained significant to so company provide holding flows down cash that those debt. capacity

of a dividend. with debt years next over paying billion the $X five little more that the down suspended paid from debt flows cash retained over We being are that down anticipating roughly than the majority that of

I in front think path debt the debt down first to that securitization the will of that that if, in the $X that two application to temporary be there really is application is approved a $X the application the is respect the commission to debt billion billion temporary the is pay extent down paths with pay and billion in securitization approved. used $X.X to we proceeds securitization of not from think unlikely it's is

and have waiver $X that cash temporary for We we we committed to structure time. temporary permanent Commission shareholder pay $X a flows losses in to using on the those operating as debt those will billion the that debt is net billion have asked use what funded down capital shareholder net realize over we operating losses,

pathways so the And utility debt be the two level. would that at those addressing to

Michael Lapides

for that? in And temporary think much it. unrecoverable Got I if interest to just anything is when out guidance the contributing XXXX all lay about you the to expense else that there that guide or debt slide guidance into tied is the how you HoldCo debt the that's

Jason Wells

the of debt of ratio would, sort and to to of as authorized a to that discussed. of the of half the beyond the incremental effectively XXXX amount factors of that holding utility is company and $X.X get debt application incremental above Those that are about levels; the XXXX I contributes incremental have then, that of levels three there Utility fund recovery. And There we expense sort is that billion paid down the we at interest are debt the raised First, some again sort our debt temporary we and upon will emergence a the to unrecoverable it but sources contributing ratio amount XXXX. do impact wildfire in the of equity because contribution three $X.X in no standpoint, is result authorized under equal has of above equity billion a an impact on ratio equity securitization that have fund debt on on it modest offset we

Operator

comes Your go JPMorgan. Please ahead. from next question Richard with Sutherland

Richard Sutherland

Thanks morning. recovery changes insurance a the back going good possible the here. requirements be Hi, for turning taking to couple we we've premiums. Could question that you of on Maybe should there and under speak AB the to XXXX for not my situation, by of premium are any times. touched questions you

Jason Wells

that the question. No, XXXX I modify expected that, given California of Thanks, the damages AB XXXX in that insurance. AB see anticipate Richard would issues an necessarily exceed -- wildfire sort utilities fund kind wouldn't are of billion all level don't to amendment that $X encouraged to any change for XXXX secure in sets of risk foundation of transfer transfer the the level that risk undertaking. I state past that eligibility for really up that fundamental currently for that that is to liability AB as structure

Richard Sutherland

reaching remain XXXX from, just on the about it. you quickly, then parties Kincade or of bit -- tying Got I And up? kind the the costs you. other script, spoke it expected impact guess Thank to terms standpoint but little CPUC of a hurdles this in curious in here real what in of the

John Simon

speculate on of a say in John. fire. answer it's tying their the Richard, have the give to don't fire couple certainty early more It's on First, the Hi, I will that concluding is, Kincade. evidence we things; makes really very won't and and process difficult it after the there in I up it what has

don't is is for we'd have the probably it. work determination, -- an have we things their see the like of they lays and to certainly so know, meant cause expeditious So timing We I a which you What Kincade. can for you out as report question. with tell the would

Operator

next Instructions] with from Your [Operator ahead. comes Fremont Mizuho. question go Paul Please

Paul Fremont

over haven't the and the much sort I allotment doing for that back question. are amounts confirm you you dollar the and all Thank Can just pipe very my being been convert, including finalized. first congratulations the guess

Bill Smith

Paul. Thanks, Yes.

over equity the across the of expiration the billion The green over result allotment have of at we were a shoe -- put the the that in the common a raised total question. and the the feature $X mandatory structures the ensure well backstop as of allotment place this of For so we total pipe, that billion as as time. convertible equity issued $X feature to

Paul Fremont

Great. count. affect obviously to I convert dollar the future share get going And can just that the that's amount because

Chris Foster

that. separately follow make we on with Chris. sure you I'll Paul, up it's

Paul Fremont

would expect secure, have the regulatory a receive to you approvals… you is Then -- securitization Great.

Chris Foster

in the decision the is of consideration, second well, references there speaking, in terms -- -- don't is Bill's think applications. day timing into prepared appeal that remarks the we Generally as took a I the think of quarter, XX window. I

So we sometime second quarter. in is the early think it of sort

Operator

with from Morningstar. question Travis Miller next Please go Your comes ahead.

Travis Miller

taking you definitely -- input And and the going or to them, most morning. for other and Good do you non- entities? question, the is seek have how you much --are the Utility the but during call of search governor's answered to legislators, guys appreciate seek office questions. CEO Quick from you

Bill Smith

search. new look formal is is same approval, be new is the we obviously, we be Bill. California requirement went in is and fit group the the through of talented the I and And This that good -- that here people basically thing with. would in what but Board Board. requirement no stakeholders process extremely the for formal comfortable do CEO think for will with There that we'll feeding no a question. someone for someone There the Thanks would is

in to some perform in. not level, this is from work So opinion just do caliber got it's there decile in years, able I'm I last being my to top really, a that great really the think of will right but having we coming the opportunity for quartile, Corporation and if top challenge pleased for prospects at obviously keep nothing couple high the of person

to no nice have about for environment here California. any in someone that's the concerns fit a I find So, inability

Travis Miller

might other one booked ability or so recovery then the And how follow-up the the access the XXXX the thanks. great, far. insurance impact quick you'd and line AB Okay, you've that is what fund or that that Kincade, on amount to time have

Bill Smith

claims for can paid no early AB there. billion in part the for fund after no report evidence terms Travis. I'll the above for XXXX of available haven't costs wildfire mentioning answer Jason answer us, maybe, claims $X the first was the you Thanks, insurance it's side part, we any I very earlier second reasons is

in So of and into tapping terms part. won't that the Jason second on on speculate maybe, that fund

Jason Wells

billion, speak fund $X in those cost for thing costs we estimate we threshold below our we record There's the exceeded states the wildfire no point do to rate cases, have the about underlying Right recognition rate I fire out case up Transmission are cost billion to through we but the would have cost then -- through because transmission that is John. accrual of that been have is Thanks, of receivable now identified, a XX% eligible our threshold. XX% process. Yes. see will by wait -- and it billion one recovery and begin and the though opportunity $X again the the -- cost before can to that from there $X substantive report we Owner recovery, what of the event about that see our the violations net only

Bill Smith

have Thank joining you. Travis thanks if free Have us for and questions. day today. our much. ask safe additional for today. that you for call you to fell thanks question, Thank Stephanie, Everyone, helping a the very organize call for us to

Operator

you, Thank conference today's call. concludes this

disconnect. now may You

Pacific Gas & Electric (PCG+A) 30 Jul 202020 Q2 Earnings call transcript