DBA Sempra

Good day and welcome to SEMPRA's fourth quarter earnings call. Today's conference is being recorded. At this time, I'd like to turn the conference over to Louise Bick. Please go ahead.

Good morning and welcome to SEMPRA's fourth quarter 2025 earnings call. A live webcast of this teleconference and slide presentation are available on our website under the events and presentation section. We have several members of our management team with us today, including Jeff Martin, Chairman and Chief Executive Officer, Karen Sedgwick, Executive Vice President and Chief Financial Officer, Justin Byrd, Executive Vice President of SEMPRA and Chief Executive Officer of SEMPRA Infrastructure, Caroline Nguyen, Executive Vice President of SEMPRA, Alan Nye, Chief Executive Officer of Encore, and other members of our senior management team. Before starting, I'd like to remind everyone that we'll be discussing forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual results may differ in material from those projected in any forward-looking statement we make today. The factors that could cause our actual results to differ materially are discussed in the company's most recent 10-K file with the SEC. Earnings per common share amounts in the presentation are shown on a diluted basis, and we'll be discussing certain non-GAAP financial measures. please refer to the presentation slides that accompany this call for reconciliation to GAAP measures. We also encourage you to review our 10-K for the year ended December 31st, 2025. I'd also like to mention that forward-looking statements contained in this presentation speak only as of today, February 26th, 2026, and it's important to note that the company does not assume any obligation to update or revise any of these forward-looking statements in the future. With that, please turn to slide five and let me hand the call over to Jeff.

Thank you all for joining us today. Our success in 2025 reflects how well we performed against our priorities. In that regard, we introduced five value creation initiatives last year designed to simplify Semper's business model, mitigate risk, and improve financial strength. The first value creation initiative was to prioritize utility investments with improved returns. During the year, we deployed $13 billion in CapEx, SEPRA California increased CPUC base operating margin, and Encore improved capital efficiency through the implementation of the unified tracker mechanism. Together, these factors contributed to SEPRA achieving record adjusted EPS of $4.69 at the high end of our 2025 adjusted EPS guidance range while establishing a strong foundation for continued growth through 2030. We continue to see compelling investment opportunities in Encore service territory with historic levels of transmission expansion continuing to advance. In order to support this build out, we're excited to introduce a new record capital plan of $65 billion for 2026 to 2030, representing a 17% increase to last year's plan. Karen will speak to this later in the call, including details about $9 billion of upside opportunities that we're tracking within the plan period. The second initiative was to highlight value in our LNG franchise. In September, we announced the sale of a 45% stake in SI Partners for $10 billion, implying over a $22 billion equity value. We're pleased to recognize the significant value created on behalf of our shareholders at an attractive multiple. And we continue to expect to close that transaction in the second or third quarter of 2026, subject to closing conditions. SEMPRA infrastructure also made progress during the year on several LNG projects by declaring FID on Port Arthur LNG phase two and reaching mechanical completion at ECA LNG phase one. Also, Port Arthur LNG Phase II construction continues to proceed on schedule, and we're excited by the prospect of all of these projects driving the growth profile of that business well into the next decade. Our third priority was to simplify the business and reduce portfolio risk, including the sale of non-core assets in Mexico. In December, SI Partners entered into an agreement to sell Ecogas for the equivalent of approximately $500 million in U.S. dollars. We believe the implied 12.7 EBITDA multiple provides further support for the overall value of Semper Infrastructure's portfolio, and we look forward to completing that sale in the second or third quarter of 2026, subject to closing conditions. Our fourth initiative was to execute Fit for 2025, which focused on reducing our cost structure to meet our future business needs and included modernizing our workforce to improve organizational efficiency. We have more work to do in this area, and it will continue to be a focus in 2026. Lastly, we wanted to elevate community safety and operational excellence across the enterprise, which culminated in California legislature passing SB 254, which strengthened the long-term stability of the state's wildfire fund and called for further reductions to wildfire risk exposures through the Natural Catastrophe Resiliency Study to be published in April 2026. and SDGenebian recognized as best in the West in electric customer reliability for the 20th consecutive year. Now, please turn to the next slide where Karen will walk through our financial results.