Sempra Q2 FY2025 earnings call

• Progress on 2025 value creation initiatives, with over $5 billion of new capital deployed in the first half of the year. - Capital recycling efforts: extension to the right of first offer process at Sempra Infrastructure, a nonbinding letter of intent with KKR, and progress on the Ecogas sales process. - In Sempra Texas, Oncor is executing a $36 billion 5-year capital plan and filed a comprehensive base rate review, with the recently passed HB5247 expected to reduce regulatory investment lag. - Sempra California has transmission project awards and is focused on customer affordability initiatives. - Sempra Infrastructure has made progress on various LNG and construction projects, including Port Arthur LNG Phase 2's commercial progress.

Sempra California: SDG&E was awarded an estimated $600 million in transmission projects as part of the Cal ISO 2024 to 2025 transmission plan. SDG&E also filed a request targeting savings of approximately $300 million by phasing out certain regulatory programs and is passing on $200 million of federal tax credits to customers. Sempra Texas: Oncor is executing a $36 billion 5-year capital plan and filed a comprehensive base rate review. The recently passed House Bill 5247 in Texas is expected to help reduce regulatory investment lag. Sempra Infrastructure: Cameron LNG Phase 1 celebrated the production and export of its 1,000th LNG cargo. Progress on ECA LNG Phase 1, Cimarron Wind, and Port Arthur LNG Phase 1. Port Arthur LNG Phase 2 received a non-FDA export authorization and a 20-year SPA with JERA.

• Affirmed 2025 adjusted EPS guidance range of $4.30 to $4.70 and 2026 EPS guidance of $4.80 to $5.30. - Anticipates Sempra Infrastructure transactions to close in the middle of 2026, which are expected to be accretive to the company's EPS and credit. - Oncor's base rate review is expected to receive a final order in the first quarter of 2026. - Expects incremental capital opportunities in Texas and continued progress on Sempra Infrastructure projects.

Uncertainty in the timing of Sempra Infrastructure transactions, potential impact of regulatory changes on Oncor's rate review, and market dynamics affecting LNG contracting.

Q: Jeff, could you elaborate on the KKR LOI around the Sempra Infrastructure Partners sale process, especially regarding the equity sale range and priorities?

A: The LOI contemplates an equity sale within or even above the 15% to 30% range depending upon valuation and other considerations. Priorities include optimizing the implied equity value of SI from the transaction, minimizing tax leakage, and being thoughtful on the timing and use of proceeds to improve the balance sheet.

Q: Ross asked about the incremental capital in Oncor and transmission awards, and the timing of a capital plan update.

A: Oncor has identified drivers for incremental capital, is confident about the $12 billion incremental, and the plan update will occur in 2026 after the base rate review resolution.

Q: Steven asked about the LOI timing and how it matches with Oncor's rising CapEx and impact on metrics and credit.

A: It's a complex transaction with a fall planning process, balancing capital plan roll forward, transaction timing, and proceeds use; there's potential to improve credit metrics and downgrade thresholds.

Q: Nick asked about California's wildfire legislation and affordability bills.

A: Sempra is engaged on wildfire legislation, focused on immediate customer affordability with initiatives like reducing certain regulatory programs and passing tax credits.

Q: David asked about the LNG market and Port Arthur LNG Phase 2's progress.

A: There's a positive LNG market outlook, Port Arthur LNG Phase 2 is making progress with permits, a SPA, and financing, aiming for FID in 2025.

Q: Carly asked about Texas UTM and ROE improvement timing.

A: UTM is expected to improve earned ROE by 50-100 basis points, with the first filing in the first half of 2026, and impact depending on capital deployment.