Edison International Reports 2011 Results

February 29, 2012

Media relations contact: Charles Coleman, (626) 302-7982
Investor relations contact: Scott Cunningham, (626) 302-2540

  • Company reported full-year 2011 basic losses of $(0.11) per share, compared to earnings of $3.84 per share in 2010. Core earnings for 2011 were $3.22 per share, compared to $3.48 per share last year.
  • Company reported fourth quarter 2011 basic losses of $(2.57) per share, compared to earnings of $0.51 per share in the same quarter last year. Fourth quarter core earnings for 2011 were $0.75 per share, compared to $0.58 per share in the same quarter last year.
  • The basic losses primarily relate to Edison Mission Group's (EMG) impairment of its Homer City plant and three Midwest Generation stations.

ROSEMEAD, Calif., Feb. 29, 2012 – Edison International (NYSE: EIX) today reported fourth quarter 2011 basic losses of $(2.57) per share, compared to basic earnings of $0.51 per share in the same quarter last year. Fourth quarter 2011 core earnings were $0.75 per share, compared to core earnings of $0.58 per share in the fourth quarter of 2010. Higher fourth quarter core earnings at Southern California Edison (SCE) were partially offset by losses at EMG driven by lower energy prices, capacity prices, and generation.

For 2011, the company reported basic losses of $(0.11) per share compared to basic earnings of $3.84 per share in 2010, while core earnings for 2011 decreased 7 percent to $3.22 per share compared to $3.48 per share in 2010. The increase in core earnings at SCE was more than offset by losses at EMG driven by lower energy prices, capacity prices, and generation. 

"For 2011, Edison International posted core earnings above its earnings guidance range and above Street consensus, although we reported a full-year loss due to impairment charges at our competitive generation subsidiary, EMG," said Ted Craver, chairman and chief executive officer of Edison International.  "Southern California Edison continued to contribute strong earnings growth from its ongoing capital investment program. Given the challenging power market conditions facing EMG, we have taken important steps at EMG to preserve and enhance liquidity."

Note: GAAP earnings and losses refer to net income or losses attributable to Edison International throughout this release. Core earnings are a non-GAAP financial measure. See Reconciliation of Core Earnings to GAAP Earnings and Reconciliation of Core Earnings Per Share Guidance to Basic Earnings Per Share Guidance.

Fourth Quarter Earnings Detail

SCE’s fourth quarter 2011 basic and core earnings were $0.76 per share compared to $0.56 per share in the fourth quarter of 2010. Core earnings increased primarily due to rate base growth and also included a $0.09 per share benefit related to cumulative changes to deferred income taxes.

EMG’s fourth quarter 2011 basic losses were $(3.29) per share compared to earnings of $0.03 per share in the fourth quarter of 2010. Core losses were $(0.03) per share compared to earnings of $0.10 per share in the same quarter last year. Core losses resulted from lower capacity revenues, realized energy prices, and generation, and higher interest expense, partially offset by higher trading and renewables project income. Fourth quarter 2011 results included the following non-core items: impairment charges for Homer City, three Midwest Generation facilities, and certain wind assets, charges resulting from reduced wind development activity, and charges from the write-off of an American Airlines aircraft lease receivable. Also included was a benefit related to the prior March Point sale. Fourth quarter 2010 results included a non-core charge related to the write-off of capitalized costs at Midwest Generation.

The Homer City impairment charge reflects EMG’s expectation that it is likely to lose substantially all beneficial economic interest in Homer City as a result of an inability to secure third-party financing of environmental controls and the current process underway to transfer Homer City to the owner-lessors. Reflecting low power prices and required retrofits which are less economical for some smaller coal-fired generation stations, EMG decided to shut down Midwest Generation’s Fisk by the end of 2012 and Crawford by the end of 2014. It also concluded it was less likely to retrofit Waukegan than the remaining larger stations, though no final decision has been made. These decisions resulted in impairments of all three Midwest Generation stations.
 
Edison International parent company and other reported a fourth quarter 2011 basic loss of $(0.04) per share compared to a $(0.08) per share basic loss in the same quarter last year. Core earnings were $0.02 per share in the fourth quarter of 2011 compared to core losses of $(0.08) per share in the fourth quarter of 2010. Non-core charges in the fourth quarter of 2011 included a $(0.06) per share consolidated deferred tax adjustment related to EMG asset impairments.

Full-Year Earnings Detail

SCE’s basic earnings in 2011 were $3.33 per share compared to $3.19 per share in 2010. Core earnings were $3.33 per share compared to $3.01 per share in 2010. The increase in core earnings was primarily driven by rate base growth.

EMG’s basic losses in 2011 were $(3.34) per share compared to earnings of $0.69 per share in 2010. Core losses were $(0.07) per share compared to earnings of $0.59 per share in 2010. EMG’s core losses were driven by lower average realized energy prices, capacity prices, and generation for the merchant coal plants, higher interest expense, and lower trading revenue. Losses were partially offset by an increase in renewable project income. Non-core items in 2011 included the fourth quarter non-core items discussed above together with impacts from discontinued operations. Non-core items in 2010 included benefits from tax settlements and discontinued operations, and a charge from the write-off of capitalized costs.

Edison International parent company and other reported 2011 basic losses of $(0.10) per share compared to a loss of $(0.04) per share in 2010. Core losses were $(0.04) per share in 2011 compared to a loss of $(0.12) per share in 2010. Non-core items included a charge for consolidated deferred tax adjustment related to asset impairment in 2011 and a benefit associated with the global settlement in 2010.

2012 Earnings Guidance

The company will provide 2012 earnings guidance after SCE has received a final decision on its 2012 General Rate Case from the California Public Utilities Commission. See the risk disclosure statement on page 4 and the financial teleconference presentation accompanying the company’s earnings conference call for further information.

About Edison International

Edison International, through its subsidiaries, is a generator and distributor of electric power and an investor in infrastructure and energy assets, including renewable energy. Headquartered in Rosemead, Calif., Edison International is the parent company of Southern California Edison, one of the nation’s largest electric utilities, and Edison Mission Group, a competitive power generation business.

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APPENDIX AND SUMMARY FINANCIAL SCHEDULES

Edison International Reports 2011 Results