PG&E Corp (PCG, Financial) released its earnings report on October 26, 2023, revealing a decrease in both GAAP and non-GAAP core earnings for the third quarter of 2023 compared to the same period in 2022. The company recorded GAAP earnings of $0.16 per diluted share for Q3 2023, compared to earnings of $0.21 per diluted share for the same period in 2022. Non-GAAP core earnings were $0.24 per diluted share for Q3 2023, compared to earnings of $0.29 per diluted share in Q3 2022.
Financial Performance and Challenges
PG&E Corp (PCG, Financial) reported a decrease in GAAP results, primarily driven by accelerated amortization of the Wildfire Fund asset related to the additional charge in the third quarter of 2023 for probable losses in connection with the 2021 Dixie fire. This was offset by increased tax benefits related to the Fire Victim Trust’s sale of PG&E Corporation common stock.
The decrease in non-GAAP core earnings was primarily driven by timing items related to taxes and overheads, increased operation and maintenance spending as a result of performing regular work that was delayed in the first half of 2023 due to storm response activity, and redeployment of resources into various programs such as information technology system improvements.
Financial Achievements and Guidance
Despite the decrease in earnings, PG&E Corp (PCG, Financial) is forecasting no equity needs in 2023 through 2024. The company also updated its 2023 EPS guidance for GAAP earnings from $1.04 to $1.13 per share to $0.99 to $1.08 per share. However, it reaffirmed its 2023 EPS guidance for non-GAAP core earnings in the range of $1.19 to $1.23 per share.
Key Details from Financial Statements
For the first nine months of 2023, PG&E Corp (PCG, Financial) recorded GAAP earnings of $0.62 per diluted share, compared to earnings of $0.60 per diluted share for the same period in 2022. Non-GAAP core earnings were $0.76 per diluted share for the first nine months of 2023, compared to earnings of $0.84 per diluted share for the same period in 2022.
The company's total operating revenues for the third quarter of 2023 were $5.88 billion, with electric revenues accounting for $4.5 billion and natural gas revenues contributing $1.38 billion. The total operating expenses for the same period were $5.48 billion.
Company's Performance Analysis
PG&E Corp (PCG, Financial) is making progress on system safety, cutting wildfire ignitions from its equipment this year, on top of last year’s reductions. The company is also on track to reach its 2023 goal to put 350 miles of powerlines underground, part of its breakthrough goal to underground 10,000 miles in the highest fire-risk areas.
However, the company's financial performance has been impacted by several factors, including the additional charge for probable losses in connection with the 2021 Dixie fire and increased operation and maintenance spending. Despite these challenges, the company remains optimistic about its financial outlook, forecasting no equity needs in 2023 through 2024 and reaffirming its 2023 EPS guidance for non-GAAP core earnings.
Explore the complete 8-K earnings release (here) from PG&E Corp for further details.
