Company: SREA
Filing Date: 2025-08-07
Form Type: 10-Q
Source: 0001032208-25-000048
Chunk: 311

Company: SEMPRA
Filing Date: 2025-08-07
Form: 10-Q
Item: Item 8
Chunk 311
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 driven by foreign currency and inflation effects on our monetary positions in Mexico and unrealized losses in 2025 from interest rate swaps related to the PA LNG Phase 1 project.

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Table of Contents

IMPACT OF FOREIGN CURRENCY AND INFLATION RATES ON RESULTS OF OPERATIONS

Because our natural gas distribution utility in Mexico, Ecogas, uses its local currency as its functional currency, its revenues and expenses are translated into U.S. dollars at average exchange rates for the period for consolidation in Sempra’s results of operations. We discuss further the impact of foreign currency and inflation rates on results of operations, including impacts on income taxes and related hedging activity, in “Part II – Item 7. MD&A – Impact of Foreign Currency and Inflation Rates on Results of Operations” in the Annual Report.

Foreign Currency Translation 

Any difference in average exchange rates used for the translation of income statement activity from year to year can cause a variance in Sempra’s comparative results of operations. In the three months and six months ended June 30, 2025 compared to the same periods in 2024, the change in our earnings as a result of foreign currency translation rates was negligible.

Transactional Impacts

Income statement activities at our foreign operations and their equity method investments are also impacted by transactional gains and losses, a summary of which is shown in the table below:

TRANSACTIONAL GAINS (LOSSES) FROM FOREIGN CURRENCY AND INFLATION EFFECTS(Dollars in millions) Total reported amountsTransactional gains (losses) included in reported amounts Three months ended June 30, 2025202420252024Other income, net$59 $30 $1 $(1)Income tax (expense) benefit(172)130 (122)186 Equity earnings393 433 (25)38 Net income519 871 (146)223 Earnings attributable to noncontrolling interests(46)(146)49 (71)Earnings attributable to common shares461 713 (97)152  Six months ended June 30, 2025202420252024Other income, net$150 $129 $5 $— Income tax (expense) benefit(229)(42)(112)133 Equity earnings718 781 (27)30 Net income1,438 1,752 (134)163 Earnings attributable to noncontrolling interests(48)(215)45 (52)