SRE
Sempra
NYSE
DEF 14A: Sempra Invites Shareholders to 2024 Annual Meeting, Highlights Strong Performance and Governance
Sentiment:
Proxy Statement
25 March 2024 8:01 AM
Sempra's 2024 proxy statement invites shareholders to the annual meeting on May 9, 2024, highlighting the company's achievements, governance practices, and matters for shareholder voting.
Better than expected
Sempra's business strategy helped the company deliver a series of record financial results in 2023.
The company's total shareholder return has outpaced the return of the S&P 500 Utilities Index during the past one, three and five years.
Sempra California reduced methane emissions by approximately 70% from 2015 levels through 2022.
2023 annual bonuses were achieved at 176% of target based on performance on ABP Earnings, Safety Measures, and Sustainability Measures.
The overall payout for the 2021-2023 LTIP awards based on relative TSR and EPS growth was 163% of target.
Summary
- Sempra is holding its 2024 Annual Shareholders Meeting virtually on May 9, 2024.
- The proxy statement highlights Sempra's 25th anniversary and its outperformance of its peer group in delivering superior total shareholder returns since inception.
- Sempra is focused on energy infrastructure investments that produce quality returns with moderated risk, strategically positioning the company to benefit from electrification and decarbonization trends.
- The Board of Directors is focused on delivering near-term business outcomes while building a stronger and more resilient future business model across Sempra California, Sempra Texas, and Sempra Infrastructure.
- In 2023, Richard J. Mark, former chairman and president of Ameren Illinois, was appointed to the board and is up for election by Sempra shareholders.
- Sempra's workforce consists of more than 20,000 employees.
- The company emphasizes transparent and effective two-way communication with shareholders.
- Sempra's business strategy helped deliver a series of record financial results in 2023.
- The company's total shareholder return has outpaced the return of the S&P 500 Utilities Index during the past one, three, and five years.
- Sempra's market capitalization more than doubled over the past 10 years, from $22 billion at the end of 2013 to $47 billion at the end of 2023.
- From 2010 to 2023, Sempra increased its annual dividend from $0.78 to $2.38 per common share, and the dividend was raised for the fourteenth consecutive year in 2024 to $2.48 per common share on an annualized basis.
- Sempra's 2024-2028 capital plan increased from the 2023-2027 plan by $1.3 billion to $48 billion.
- Sempra California reduced methane emissions by approximately 70% from 2015 levels through 2022.
- Oncor's rate base increased from $12.6 billion to $23.1 billion from 2018 through 2023.
- The company's executive compensation program emphasizes variable performance-based pay.
- 2023 annual bonuses were achieved at 176% of target based on performance on ABP Earnings, Safety Measures, and Sustainability Measures.
- The overall payout for the 2021-2023 LTIP awards based on relative TSR and EPS growth was 163% of target.
Sentiment
Score: 8
Explanation: The document presents a positive outlook for Sempra, highlighting strong financial performance, strategic initiatives, and commitment to shareholder value. While acknowledging risks, the overall tone is optimistic and confident.
Positives
- Sempra has a strong track record of board refreshment, adding four current directors since the beginning of 2018.
- The company has strong governance practices, including a Lead Independent Director with robust responsibilities and annual election of all directors.
- Sempra has a robust share ownership guideline for directors and officers.
- The company has an active shareholder engagement program with key members of management and the Lead Independent Director.
- Sempra has a strong dividend growth rate, exceeding the median CAGR for companies in the S&P 500 Utilities Index over the past five, 10, and 20 years.
- The company has a high-performance culture with an unwavering focus on safety and a commitment to ethical and sustainable business practices.
- Sempra has a robust internal audit function that reports directly to the Audit Committee.
Negatives
- The document mentions a contractor fatality, leading to negative discretion being applied to the contractor safety measure in the annual bonus plan.
Risks
- The document mentions risks inherent in business operations, including safety, health, operational, human capital, regulatory, compliance, climate, environmental, cybersecurity, business, financial, and reputational risks.
- The document mentions the potential for litigation and regulatory penalties related to catastrophic incidents.
- The document mentions the potential for financial losses due to wildfires and other natural disasters.
Future Outlook
Sempra expects its utility businesses to continue to require investments in critical transmission and distribution infrastructure, modernize energy systems, and remain focused on delivering cleaner, safer, and more reliable energy.
Management Comments
- Jeffrey W. Martin, Chairman and Chief Executive Officer: 'We extend our sincere gratitude to the employees who are working hard every day to achieve Sempras mission to be North Americas premier energy infrastructure company.'
- Cynthia J. (CJ) Warner, Lead Independent Director: 'We remain committed to upholding a strong shareholder engagement program, which is anchored by our commitment to transparent and effective two-way communication.'
Industry Context
Sempra's focus on energy infrastructure investments aligns with industry trends related to electrification and decarbonization. The company's performance is compared to the S&P 500 Utilities Index and a general industry peer group.
Comparison to Industry Standards
- The document compares Sempra's performance to the S&P 500 Utilities Index and a general industry peer group.
- Sempra's dividend growth exceeds the median CAGR for companies in the S&P 500 Utilities Index over the past five, 10 and 20 years.
- The payout scale for EPS growth-based LTIP awards is based on forward consensus estimates of EPS CAGR of S&P 500 Utilities Index peers.
- The document references companies included in the General Industry Market Review (Appendix B) and the Utilities Market Review (Appendix C).
- The document references the Sustainability Accounting Standards Board (SASB) and Task Force on Climate-related Financial Disclosures (TCFD) reporting frameworks.
Stakeholder Impact
- The company aims to deliver safe, reliable, and increasingly clean forms of energy to customers.
- The company is committed to increasing shareholder value.
- The company is focused on building a stronger and more resilient future business model across Sempra California, Sempra Texas, and Sempra Infrastructure.
- The company is committed to upholding a strong shareholder engagement program.
Next Steps
- Shareholders are encouraged to review the proxy materials and promptly vote their shares.
- The company will continue to execute its sustainable business strategy and focus on delivering near-term business outcomes.
- The board will continue its thoughtful refreshment process and continuing board education.
Key Dates
- March 13, 2024: Record date for the Annual Shareholders Meeting
- March 25, 2024: Proxy materials are first being made available to shareholders
- May 6, 2024: Deadline for Employee Savings Plans voting instructions
- May 8, 2024: Internet and telephone voting deadline for holders of record
- May 9, 2024: Date of the Annual Shareholders Meeting
- November 25, 2024: Deadline for shareholder proposals for 2025 proxy materials
- January 9, 2025: Start of the period for shareholder nominations or other items of business for the 2025 annual shareholders meeting
- February 8, 2025: End of the period for shareholder nominations or other items of business for the 2025 annual shareholders meeting
Keywords
shareholder, governance, compensation, directors, performance, energy, Sempra, board, executive, annual
SRE
Sempra
NYSE
Sector: Utilities
Filings with Classifications
Better than expected
23 June 2025 6:56 AM
Regulatory Update
- The new Unified Tracker Mechanism (UTM) is expected to improve Oncor's earnings, cash flows, and credit metrics.
- The UTM is projected to improve Oncor's earned annual returns on equity by approximately 50 to 100 basis points.
- The mechanism allows for more timely recovery of capital investments, reducing regulatory lag compared to previous methods.
Capital raise
13 May 2025 4:20 PM
Debt Offering Announcement
- Southern California Gas Company is raising $1.1 billion through the issuance of first mortgage bonds.
- The funds are intended for general corporate purposes.
Better than expected
8 May 2025 8:07 PM
Quarterly Report
- Sempra's Q1 2025 earnings attributable to common shares increased to $906 million, or $1.39 per share, compared to $801 million, or $1.27 per share, in the prior year.
Capital raise
8 May 2025 8:07 PM
Quarterly Report
- Sempra established an ATM program providing for the offer and sale of shares of Sempra common stock having an aggregate gross sales price of up to $3.0 billion.
- Sempra entered into forward sale agreements under the ATM program with Bank of America, N.A. and Wells Fargo Bank, N.A.
Better than expected
8 May 2025 10:53 AM
Earnings Release
- Sempra's first-quarter 2025 GAAP earnings increased to $906 million ($1.39 per diluted share) from $801 million ($1.26 per diluted share) in the first quarter of 2024.
- Adjusted first-quarter 2025 earnings rose to $942 million ($1.44 per diluted share) from $854 million ($1.34 per diluted share) in 2024.
Better than expected
28 March 2025 4:14 PM
Proxy Statement
- Sempra's three-year total shareholder return far outpaced the return of the S&P 500 Utilities Index and more than tripled the returns of the S&P 500 and S&P 500 Utilities Indices since the beginning of this century (from December 31, 1999 through December 31, 2024).
Capital raise
25 March 2025 4:17 PM
Debt Offering
- San Diego Gas & Electric Company is raising $850 million through the issuance of 5.400% First Mortgage Bonds, Series CCCC, due 2035.
- The net proceeds are estimated to be approximately $842.1 million after deducting the underwriting discount but before deducting the Companys estimated offering expenses.
Delay expected
25 February 2025 4:57 PM
Annual Report
- The ECA LNG Phase 1 project is expected to commence commercial operations in the spring of 2026, which is later than previously anticipated.
- The first and second trains of the PA LNG Phase 1 project are expected to commence commercial operations in 2027 and 2028, respectively, which is later than previously anticipated.
Worse than expected
25 February 2025 4:57 PM
Annual Report
- Earnings attributable to common shares decreased from $3.030 billion in 2023 to $2.817 billion in 2024.
- Total revenue decreased from $16.720 billion in 2023 to $13.185 billion in 2024.
Capital raise
25 February 2025 4:57 PM
Annual Report
- Sempra established an ATM program providing for the offer and sale of shares of Sempra common stock having an aggregate gross sales price of up to $3.0 billion.
- Sempra entered into a forward sale agreement under the ATM program for the sale of 2,909,274 shares of Sempra common stock.
Worse than expected
25 February 2025 10:54 AM
Earnings Release
- Full-year 2024 GAAP earnings decreased compared to 2023.
- The revision of the full-year 2025 EPS guidance range to $4.30 to $4.70 may be viewed negatively.
Capital raise
21 November 2024 4:05 PM
Debt Offering
- Sempra closed a public offering of $400 million of 6.625% Fixed-to-Fixed Reset Rate Junior Subordinated Notes due 2055 and $600 million of 6.550% Fixed-to-Fixed Reset Rate Junior Subordinated Notes due 2055.
- The total proceeds to Sempra from the sale of the notes were approximately $990 million, after deducting underwriting discounts but before deducting offering expenses estimated at $1.7 million.
Capital raise
6 November 2024 3:40 PM
Quarterly Report
- Sempra established an ATM program to offer and sell shares of common stock with an aggregate gross sales price of up to $3.0 billion.
- The company intends to use the net proceeds for working capital and other general corporate purposes, including to partly finance anticipated increases to its long-term capital plan and to repay outstanding commercial paper and potentially other indebtedness.
Worse than expected
6 November 2024 3:40 PM
Quarterly Report
- Sempra's third quarter earnings were worse than the same period last year due to lower revenues and higher interest expenses.
- Sempra California's earnings were worse than the same period last year due to lower income tax benefits and higher net interest expenses.
- Sempra Texas Utilities' earnings were worse than the same period last year due to lower equity earnings from Oncor Holdings.
Capital raise
6 November 2024 10:50 AM
Quarterly Report
- The company has put in place a $3 billion at-the-market (ATM) equity offering program to support general corporate purposes including its future financing needs.
Worse than expected
6 November 2024 10:50 AM
Quarterly Report
- Third-quarter 2024 GAAP and adjusted earnings were lower compared to the same period in 2023.
- The company has lowered its full-year 2024 GAAP EPS guidance range.
Capital raise
9 September 2024 4:02 PM
Debt Offering Announcement
- Sempra has raised $1.25 billion through the issuance of junior subordinated notes.
- The net proceeds to the company are approximately $1.238 billion after deducting underwriting discounts.
Capital raise
9 August 2024 4:45 PM
Debt Issuance Announcement
- Southern California Gas Company is raising $600 million through the issuance of First Mortgage Bonds.
- The net proceeds are estimated to be approximately $593.2 million after deducting the underwriting discount.
Worse than expected
6 August 2024 3:48 PM
Quarterly Report
- Sempra's year-to-date earnings were worse than the same period last year, primarily due to lower income tax benefits and unrealized losses on commodity derivatives.
Capital raise
6 August 2024 3:48 PM
Quarterly Report
- Sempra completed an offering of 19,242,010 shares of its common stock in November 2023.
- Sempra has forward sale agreements for 17,142,858 shares of its common stock, which may be settled no later than December 31, 2024.
Delay expected
6 August 2024 10:54 AM
Quarterly Report
- The Energa Costa Azul LNG Phase 1 project has experienced labor and productivity challenges, which has delayed the expected mechanical completion and first LNG to 2025, with commercial operations targeted for spring 2026.
Worse than expected
6 August 2024 10:54 AM
Quarterly Report
- Sempra's adjusted earnings for the second quarter of 2024 were lower than the same period in 2023.
- Sempra's adjusted earnings for the first six months of 2024 were also lower than the same period in 2023.
Capital raise
31 May 2024 4:02 PM
Debt Offering Announcement
- Sempra raised $500 million through the issuance of junior subordinated notes.
- The proceeds will be used for general corporate purposes.
Worse than expected
7 May 2024 4:29 PM
Quarterly Report
- Sempra's earnings were worse than expected due to lower natural gas prices and unrealized losses on commodity derivatives.
- Sempra California's earnings were worse than expected due to lower CPUC base operating margin and higher interest expenses.
- Sempra Infrastructure's earnings were worse than expected due to unrealized losses on commodity derivatives and lower transportation revenues.
Capital raise
7 May 2024 4:29 PM
Quarterly Report
- Sempra completed an offering of 17,142,858 shares of common stock in November 2023.
- The company expects to settle forward sale agreements related to the offering by December 31, 2024, which may result in additional cash proceeds.
- Sempra may elect cash settlement or net share settlement for all or a portion of its obligations under the forward sale agreements.
Worse than expected
7 May 2024 11:02 AM
Quarterly Report
- Sempra's GAAP earnings decreased from $969 million in Q1 2023 to $801 million in Q1 2024.
- Adjusted earnings also decreased from $922 million in Q1 2023 to $854 million in Q1 2024.
Better than expected
17 April 2024 4:18 PM
Proxy Statement Supplement
- Sempra achieved record revenue of $16.7B in 2023.
- GAAP EPS has grown at a 22.9% CAGR and adjusted EPS has grown at a 10.3% CAGR from 2018-2023.
- Sempra increased its five-year capital plan by 20% to $48 billion.
Better than expected
25 March 2024 8:01 AM
Proxy Statement
- Sempra's business strategy helped the company deliver a series of record financial results in 2023.
- The company's total shareholder return has outpaced the return of the S&P 500 Utilities Index during the past one, three and five years.
- Sempra California reduced methane emissions by approximately 70% from 2015 levels through 2022.
- 2023 annual bonuses were achieved at 176% of target based on performance on ABP Earnings, Safety Measures, and Sustainability Measures.
- The overall payout for the 2021-2023 LTIP awards based on relative TSR and EPS growth was 163% of target.
Capital raise
19 March 2024 4:21 PM
Debt Issuance Announcement
- San Diego Gas & Electric is raising $600 million through the issuance of first mortgage bonds.
- The net proceeds are estimated to be approximately $588.7 million after deducting the underwriting discount but before deducting the company's estimated offering expenses.
Capital raise
18 March 2024 4:40 PM
Debt Issuance Announcement
- Southern California Gas Company raised $500 million through the issuance of First Mortgage Bonds.
- The proceeds will be used for general corporate purposes.
Capital raise
14 March 2024 4:01 PM
Debt Offering Announcement
- Sempra has raised $600 million through the issuance of 6.875% Fixed-to-Fixed Reset Rate Junior Subordinated Notes due 2054.
- The net proceeds to the company were approximately $594 million after deducting underwriting discounts but before other expenses.
Capital raise
13 March 2024 4:08 PM
Debt Offering Announcement
- Southern California Gas Company is raising $500 million through the issuance of First Mortgage Bonds.
- The net proceeds are estimated to be approximately $492.4 million after deducting underwriting discounts.
Better than expected
27 February 2024 10:55 AM
Annual Results
- Sempra's full-year 2023 GAAP earnings of $3.03 billion were significantly better than the $2.09 billion reported in 2022.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.