Edison International Q2 FY2025 earnings call

• Eaton Fire: Investigations by SCE and LA County Fire Department ongoing; no new disclosures on ignition or cost. SCE is not aware of evidence pointing to another ignition source. Wildfire recovery compensation program to launch fall 2025 to provide direct payments to eligible individuals and businesses.
• Legislative: Encouraged by discussions to enhance California's AB 1054 regulatory framework; affordability bills being discussed, with securitizing capital potentially raising customer costs.
• Regulatory: SCE's 2025 DRC proposed decision generally aligns with rate base forecast. PD supports capital investments in wildfire mitigation, grid modernization, etc. SCE submitted 2026-2028 wildfire mitigation plan, anticipating $6.2B investment. Public Safety Power Shutoffs updated with revised criteria. CPUC issued final decisions in WMCE and WM/VM proceedings, and SCE filed for securitized bonds for TKM proceeding.

Edison International reported second quarter core earnings per share of $0.97 compared to $1.23 a year ago. SCE's core EPS variance was primarily driven by higher O&M expense and the net impact of regulatory decisions received in each period. EIX Parent and Other's variance was primarily driven by higher interest expense. SCE has not received a final decision in its 2025 general rate case, so year-over-year comparison is not particularly meaningful.

• Reaffirmed 2025 core EPS range of $5.94 to $6.34 and expects 5% to 7% core EPS CAGR through 2028.
• Guidance will be refreshed 6 weeks after SCE receives final decision in its 2025 general rate case.

• Ongoing uncertainty around Eaton Fire investigation with no new disclosures on ignition or cost.
• Potential impacts of regulatory changes, such as securitizing capital possibly raising customer costs due to deteriorating credit quality.

Q: Nicholas Campanella asked about AB 1054 and whether SCE would have a disproportionately large contribution to the wildfire fund compared to other utilities, and about when Eaton Fire liability would be disclosed.

A: Pedro J. Pizarro stated it's hard to comment on contribution disparity yet and that disclosure of Eaton Fire liability would depend on materiality and would be done appropriately for transparency.

Q: Richard Sunderland inquired about the GRC proposed decision versus the range case forecast and if the 6-week post-final decision update would cover other opportunities.

A: Maria C. Rigatti replied the PD aligns with range case outcome, and the 6-week update would include view on other opportunities.

Q: Richard Sunderland also asked about the ability to reach a settlement in the Woolsey cost recovery case.

A: Maria C. Rigatti said SCE is open to settlement discussions if fair and reasonable, and they put a good showing in rebuttal testimony.

Q: Carly Davenport asked about affordability legislation provisions like securitization and alternative constructive ways to support affordability.

A: Pedro J. Pizarro discussed utility operational efficiency, public purpose programs, net energy metering, and how securitization could raise customer costs due to credit quality impact.

Q: Angie Storozynski questioned the incentive for investors in California utilities given regulatory challenges and risk acceptance.

A: Pedro J. Pizarro stated California generally gets it right ultimately, and Maria C. Rigatti mentioned shoring up AB 1054 framework as a foundation for addressing wildfire issues long-term.

Q: Gregg Orrill asked about the status of the Eaton Fire investigation and stance on issuing equity for wildfire fund contributions.

A: Pedro J. Pizarro said Eaton Fire investigation has LA County Fire and Edison's own investigations, taking time due to collaboration; Maria C. Rigatti said issuing equity for contributions would increase cost of capital and not benefit customers.

Q: Paul Zimbardo asked if the PD aligns with EPS growth rate and about the leap-off point for the 6-week roll forward.

A: Maria C. Rigatti replied the PD aligns with range case forecast, and the 6-week roll forward would replicate current '25 through '28 analysis.

Q: Anthony Crowdell asked about AB 1054 as an anchor for wildfire solution and how Eaton Fire plays into legislative session outcomes.

A: Pedro J. Pizarro said AB 1054 has important prudency provisions, and Maria C. Rigatti mentioned current fund has $22B claims paying capacity and Eaton Fire investigation is ongoing with probable loss.

Q: Ryan Levine asked about advantages of the wildfire recovery compensation program and its logic during legislative session.

A: Pedro J. Pizarro said the program helps the community quickly amid probable loss and litigation; Maria C. Rigatti added it mitigates construction costs and legal expenses, benefiting the wildfire fund and community.