PG&E profits drop drastically, due to wildfire cleanup and bankruptcy
The company also said it plans to add one more member to its board of directors.
PG&E Corp.’s profits have taken a huge hit because of the Camp Fire and the company’s related decision to file for bankruptcy protection.
The parent company of Pacific Gas and Electric Co. said Thursday that its net income in the first quarter of this year plummeted 69% to $136 million, from $442 million a year earlier.
PG&E attributed the fall largely to costs stemming from the Camp Fire, which the company has admitted the state will probably find it responsible for, and its bankruptcy. The embattled utility sought protection under Chapter 11 of the U.S. Bankruptcy Code in January, citing potentially $30 billion in liabilities from 2017 and 2018 wildfires.
The Camp Fire cost PG&E $192 million in the first quarter this year, including $179 million for cleanup and repair costs and $13 million for legal costs and other expenses, the company said.
PG&E also reported $127 million in bankruptcy-related costs, including $114 million related to its debtor-in-possession financing and $24
million for legal costs and other expenses. Those were partially offset by $11 million in interest income, according to the company.
Operating revenue for the quarter remained essentially flat at $4 billion.
Bill Johnson, PG&E’s new chief executive officer, said in a statement that the company was “continuing to implement programs that will make the communities we serve safer in the face of extreme weather and wildfire risk, while also recognizing that significant work remains to be done as our state collectively confronts the coming wildfire season and the challenges of climate change.”
The company stressed its plans to bolster its vegetation management work, inspect 735,000 power poles in high-fire-threat areas and expand its program for turning off the power during dangerous wildfire weather.
PG&E’s shares were down 3.4% after Thursday’s trading.
The company also said it plans to add one more member to its board of directors, growing the total size of the body to 15 people. Current members of the PG&E board’s governance committee will start searching for a 15th director with an eye toward candidates with backgrounds in clean energy, network and customer technology, ties to California and “expertise in California’s clean energy goals,” the company said.
Shareholders will vote on the proposal to expand the board size at the company’s annual meeting. PG&E had planned to hold the shareholders’ meeting later this month but pushed it back and has not announced a new date.