Sempra Energy expects annual capital expenditures and investments to average approximately $2.9 billion through 2014, up from about $2.4 billion annually during the previous five years, CEO Donald E. Felsinger said Thursday.
From 2005-2009, 57% of Sempra’s capital spending program was devoted to utilities San Diego Gas & Electric and Southern California Gas Co. and 43% to infrastructure; that mix will shift to 73% for utilities and 27% infrastructure through 2014. The utilities’ five-year capital plan was recently expanded to include substation expansions, renewable ownership, distributed solar generation and alternative fuel vehicle infrastructure projects.
More than 60% of Sempra’s 2010-2014 earnings is expected to come from utilities, compared with 45% in the previous five-year period. Trading, which had accounted for 36% of 2005-2009 earnings, will bring in just 3% in the next five years, Felsinger said.
As the first of a two-part move to restructure the RBS Sempra Commodities joint venture trading business, the partners announced in February that they had agreed to sell their European and Asian operations to JPMorgan Chase & Co. for an expected $1.7 billion (see Daily GPI, Feb. 17). Days later, with the prospect of walking away with more than $2 billion, Sempra said that it planned to sell its remaining interest in the joint venture energy trading business (see Daily GPI, Feb. 26). The company reported essentially flat year-end 2009 profits and reduced earnings in the trading business.
The San-Diego based company reaffirmed 2010 earnings per share (EPS) guidance of $4.25-4.50 and 2011 EPS of $4.35-4.65 at the beginning of its financial analyst conference in San Diego Thursday.
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