By Nicole Jao
NEW YORK (Reuters) – Utility firm Edison International on Wednesday missed Wall Street estimates for third-quarter profit due to higher interest expense associated with California wildfire claim payments.
Edison International said its public utility subsidiary California Edison Company (SCE) continued to work through wildfire claims payments associated events in 2017 and 2018. These claims payments are funded with debt.
After review, the company increased the estimated expected losses for the wildfires by $475 million, driven by settlements being resolved at higher-than-expected levels, CEO Pedro Pizarro said during a call with analysts on Wednesday.
The Rye, Meyers, Liberty, and Thomas Fires ignited across several parts of SCE’s service territory in December 2017. In November 2018, the Woolsey Fire began in Ventura County.
As part of its wildfire mitigation strategy, the company said it has made progress in grid hardening, vegetation management, asset inspections and other programs. As of September, it installed more than 5,200 miles (8,400 km) of covered conductor.
Adjusted profit came in at $1.38 per share for the quarter ended in September, below analysts’ estimates of $1.46, LSEG data showed.
On an adjusted basis, the company reiterated its 2023 profit forecast of between $4.55 and $4.85 per share.
The company said SCE’s third-quarter earnings per share decreased year over year, primarily due to higher interest expense and an accounting adjustment.
SCE delivers electricity to about 15 million customers across the southern, central, and coastal region of the state.
The company’s quarterly revenue was $4.70 billion, down 11.2% and below estimates of $5.71 billion.
(Reporting by Nicole Jao; Editing by Marguerita Choy)