Edison International Reports Financial Results for the First Quarter of 2005

May 09, 2005

May 9, 2005

ROSEMEAD, Calif., May 9, 2005 –

  • Edison International (EIX) recorded consolidated earnings per common share of 61 cents in the first quarter of 2005, slightly more than double the reported earnings for the same period last year.
  • The increased earnings primarily reflect:
    • improved operating results from Mission Energy Holding Company’s (MEHC) independent power business;
    • gains from Edison Capital’s investment in the Emerging Europe Infrastructure Fund; and
    • higher revenue at Southern California Edison Company (SCE) associated with a general rate case (GRC) decision reached in July, 2004.  This July decision authorized higher revenue for the full year of 2004; therefore, a year-over-year comparison to 2005 is not expected to reflect an increase in core earnings related to the GRC decision. 

First Quarter 2005 Highlights:

  • Earnings per common share – $0.61
  • Net Income – $201 million
  • Revenues – $2.4 billion
  • Assets – $33.5 billion

FIRST QUARTER EARNINGS SUMMARY

For the quarter ended March 31, 2005, EIX recorded consolidated earnings per common share of 61 cents, compared to 30 cents in the first quarter of 2004. 

“Building on the progress made last year, we had improved results across the entire company.  Our independent power company particularly benefited from higher energy prices in the Midwest and Eastern wholesale power markets,” commented John Bryson, Chairman, Edison International. 

FIRST QUARTER EARNINGS DETAIL

Earnings (Loss) from Continuing Operations

SCE’s first quarter 2005 earnings from continuing operations were $131 million, $31 million above the same period last year.  The increase is primarily due to higher authorized revenue in 2005 from the implementation of the 2003 GRC decision.  SCE received the decision last July, which resulted in a catch-up adjustment to core earnings in the third quarter for the amounts related to the first half of 2004, as well as an increase in earnings for the second half of 2004.  A comparison of the full year of 2005 versus 2004 is not expected to reflect a core earnings difference related to the 2003 GRC decision.

MEHC’s first quarter 2005 earnings from continuing operations were $25 million compared to a loss of $39 million in the same period last year.  MEHC’s first quarter 2005 earnings from continuing operations include a $15 million after-tax charge related to the early extinguishment of debt while the first quarter 2004 loss includes a $27 million after-tax net gain from the sale of EME’s interests in Four Star Oil & Gas and the Brooklyn Navy Yard projects.  Excluding these items, MEHC’s core earnings were $40 million in the first quarter of 2005, compared to a loss of $66 million in the same period last year.  The improved core earnings were largely due to stronger operating performance at the Illinois and Homer City Plants, driven by higher merchant generation and wholesale energy prices.  Also contributing to the increase in earnings was higher income from MEHC’s marketing and trading subsidiary, stronger operating results from the Big Four projects in California and lower net corporate interest costs. 

Edison Capital’s earnings for the first quarter of 2005 were $52 million, up $41 million from the same period last year.  This increase is primarily due to Edison Capital’s share of income from its investment in the Emerging Europe Infrastructure Fund.  The Fund accounts for most of its investments at fair value, with changes in the fair value recorded quarterly through net income.  Edison Capital’s share of the Fund’s income was $43 million during the first quarter of 2005 which primarily resulted from gains on several telecommunication investments in Eastern Europe. 

The first quarter 2005 loss from “EIX parent company and other” of $14 million was $6 million lower than the same period last year primarily reflecting lower interest expense partially offset by higher taxes.  

Earnings from Discontinued Operations

EIX’s earnings from discontinued operations were $7 million in the first quarter of 2005 reflecting the operating results and sales impacts from MEHC’s Tri-Energy and CBK international projects, both of which were sold during the first quarter of 2005.  The earnings from discontinued operations in the first quarter of 2004 of $46 million represent the operating results from MEHC’s international projects that were held for sale.

 
Quarter Ended
March 31
Earnings (Loss) Per Common Share (Unaudited)
2005
2004
Change

Southern California Edison Company
$0.40
$0.31
$0.09
Mission Energy Holding Company
0.08
(0.12)
0.20
Edison Capital
0.16
0.03
0.13
EIX parent company and other
(0.05)
(0.06)
0.01

EIX Consol. Earnings from Continuing Operations
0.59
0.16
0.43

Earnings from Discontinued Operations
0.02
0.14
(0.12)

Total EIX Consolidated Earnings
$0.61
$0.30
$0.31


 
Quarter Ended
March 31
Earnings (Loss) (in millions) (Unaudited)
2005
2004
Change

Southern California Edison Company
$131
$100
$31
Mission Energy Holding Company
25
(39)
64
Edison Capital
52
11
41
EIX parent company and other
(14)
(20)
6

EIX Consol. Earnings from Continuing Operations
194
52
142

Earnings from Discontinued Operations
7
46
(39)
Cumulative Effect of Accounting Change
--
(1)
1

Total EIX Consolidated Earnings
$201
$97
$104

 

 
Quarter Ended March 31
 
Core Earnings (Loss) Per Common Share (Unaudited)
2005
2004
Change

Southern California Edison Company
$0.40
$0.31
$0.09
Mission Energy Holding Company
0.13
(0.20)
0.33
Edison Capital
0.16
0.03
0.13
EIX parent company and other
(0.05)
(0.06)
0.01

EIX Consol. Core Earnings
0.64
0.08
0.56

Non-core items
  Mission Energy Holding Company
   Extinguishment of debt
(0.05)
--
(0.05)
   Net gain on sale of interests in Four
     Star Oil & Gas and the Brooklyn
     Navy Yard projects
--
0.08
(0.08)
   Earnings from discontinued
     operations
0.02
0.14
(0.12)

 
(0.03)
0.22
(0.25)

Total EIX Consolidated Earnings
$0.61
$0.30
$0.31


This release includes words like “expect” which identify forward-looking information that involves risks and uncertainties.  Actual results or outcomes could differ materially because of important factors that are discussed in EIX’s and its subsidiaries’ Forms 10-K, 10-Q and 8-K.

Reminder:  EIX Will Hold a Conference Call Today

Today, EIX will hold a conference call to discuss its first quarter 2005 financial results at 8:00 a.m. PDT.  Although two-way participation in the telephone call is limited to financial analysts and investors, all other interested parties are invited to participate in a “listen-only mode” through a simultaneous webcast on the company’s Web site at www.edisoninvestor.com.  Additional financial and other statistical information, if any, presented during the call will be available on the Web site.  The domestic call-in number is (800) 356-8584 and the ID# is 10300.  

Additional Attachments:

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Based in Rosemead, Calif., Edison International (NYSE: EIX) is the parent company of Southern California Edison, Edison Mission Energy and Edison Capital.