(Bloomberg) -- Edison International’s shares hit an all-time high after the California utility owner said it has reached a tentative agreement with state officials to recover nearly $1.7 billion in losses from wildfires and mudslides in 2017 and 2018.
Edison shares rose as much as 2.5% to $87.14 Thursday, the company’s biggest intraday gain in three weeks.
The company’s Southern California Edison utility had asked state regulators to let it pass on to customers almost $2.8 billion in costs related to the Thomas Fire, the Koenigstein Fire and the Montecito Mudslides, which together destroyed more than 1,400 structures and killed 23 people. Under a settlement reached with the state Public Advocates Office, SoCal Edison would be allowed to recover from customers more than $1.6 billion of uninsured claims, financing and legal costs, according to a filing Thursday. SoCal Edison can also get $55 million from ratepayers for restoration costs.
The recovery of about 60% of its costs is better than investor expectations of a 25% to 50% recovery, said Citigroup Inc. analyst Ryan Levine in a research note Thursday. “Overall, we view this update positively,” Levine said.
The settlement - which must be approved by the California Public Utilities Commission - will help resolve the financial uncertainty that has hung over SoCal Edison since investigators blamed the utility’s power lines for sparking the fires. The mudslides occurred in the burn scar of the fires.
(Updates with analyst comment in fourth paragraph.)
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