Sempra Q2 FY26 Earnings Analysis

- Sempra is executing a record $65 billion capital plan supporting strong projected rate base growth through the plan period. - Improving visibility into ~$9 billion of incremental capital opportunities beyond the base plan, primarily in Texas. - Expects to derive a majority of rate base from Texas by the end of the decade (~60% expected). - Oncor's earnings projected to grow at 30% annually through mid-2027. - Large load growth (127 GW qualifying load, mainly data center related) to drive higher levels of capital spending in Texas, beyond the base plan. - LNG segment expected to grow but capital allocation will reduce as Sempra focuses on pure-play utility business. - LNG projects (e.g., ECA) near substantial completion, supporting revenue recognition starting this summer. - Affirmed full year 2026 adjusted EPS guidance range of $4.80 to $5.30 and 2027 EPS guidance of $5.10 to $5.70, with long-term EPS growth projected at 7%-9%.

- Full year 2026 adjusted EPS guidance range affirmed at $4.80 to $5.30. - 2027 EPS guidance range affirmed at $5.10 to $5.70. - Projected long-term EPS growth rate maintained at 7% to 9%, among the highest in the utility sector. - Oncor is growing earnings at approximately 30% annually through the midpoint of its 2027 guidance. - Capital plan supports strong projected rate base growth, with increasing investments primarily in Texas. - ~$9 billion of incremental capital opportunities identified beyond the base plan, mainly in Texas. - Improved financial returns and regulatory developments (e.g., Oncor's ROE increasing closer to authorized 9.75%) support earnings growth. - Sempra's strategy focuses on durable earnings growth combined with current yield and long-term capital appreciation.

- Sempra is executing a record $65 billion capital plan supporting strong rate base growth, with a majority focused in Texas by decade-end. - There is approximately $9 billion of incremental capital opportunities beyond the base plan, primarily concentrated in Texas. - Oncor’s current $47.5 billion capital plan is solid and does not depend heavily on large data center load arrivals. - An additional $10 billion incremental CapEx bucket is being actively pursued and expected to be updated by Q2. - ERCOT recently approved about $2.9 billion in South Dallas transmission projects, included in incremental opportunities. - Oncor is growing earnings at 30% annually through 2027 midpoint, supported by transmission infrastructure investments. - LNG capital allocation reduced as Sempra shifts to a pure-play utility business with lower risk focus, emphasizing Texas utilities. - Supply chain efforts are focused on securing equipment and labor availability beyond five years to support capital programs.

- No explicit mention of new fundraising through debt or equity on page 12 or surrounding pages. - The company plans to focus on recycling capital back into utilities post the closing of Sempra Infrastructure Partners transaction, implying use of existing capital rather than new fundraising. - There's a focus on strengthening the balance sheet post-close through parent debt paydown and deconsolidation of SI Partners. - Capital allocation is primarily toward a $65 billion capital plan with about $9 billion upside, mostly funded internally rather than through new equity or debt issuance. - Efforts include improving credit profile and managing rating agency thresholds, suggesting prudent balance sheet management without immediate new debt/equity issuance. - No direct statements regarding issuing new debt or equity fundraising at this time in the transcript provided.

- Oncor has secured contracted slots for their base capital plan through 2028. - For the outer two years beyond 2028, Oncor has understandings or agreements (not all formalized) with suppliers to meet needs. - Some suppliers offer only 3-year contracts, but Oncor feels in excellent shape for the first 3 years and confident about the next 2. - The Board has authorized Oncor to secure slots and products beyond their base plan to handle incremental buckets. - There has been substantial progress in firming up $10 billion of incremental capital opportunities beyond the base plan, with updates expected later in 2024. - Orderbook includes significant equipment already ordered/acquired, e.g., 765kV equipment. - Oncor’s supply chain management and contracting efforts provide a competitive advantage in securing resources for future needs.