- Company announces third-quarter reported earnings of $0.05 per
share and earnings from ongoing operations of $0.52 per share -
2009 and 2010 earnings forecasts reaffirmed ALLENTOWN, Pa., Oct. 29
/PRNewswire-FirstCall/ -- PPL Corporation (NYSE: PPL) on Thursday
(10/29) announced declines in both third-quarter and nine-month
reported earnings for 2009, compared with the same periods of 2008.
PPL's earnings from ongoing operations, which exclude the effect of
special items, rose in the third quarter but remained lower for the
nine-month period, compared with a year ago. PPL's reported
earnings for the most recent quarter were $0.05 per share, compared
with $0.54 per share a year ago. For the first nine months of 2009,
PPL's reported earnings were $0.67 per share, compared with $1.73
per share a year ago. The primary drivers of the 2009 reported
earnings declines versus 2008 were special item charges for certain
economic hedge activity and the impact of two non-recurring income
tax matters in the current quarter, as well as an impairment for
the pending sale of generation assets on Long Island, N.Y.,
announced last quarter. The special item charges for the third
quarter of 2009 totaled $0.47 per share, compared with net special
item credits of $0.09 per share a year ago. PPL's reported earnings
for the first nine months of 2009 included special item charges of
$0.76 per share, compared with net special item credits of $0.17
per share for the same period of 2008. Earnings from ongoing
operations were $0.52 per share in the third quarter of 2009,
compared with $0.45 per share a year ago. For the first nine months
of 2009, earnings from ongoing operations were $1.43 per share,
compared with $1.56 per share a year ago. "At this point in the
year, we are pleased with our financial performance and our ability
to track ahead of plan, despite ongoing pressure on wholesale
energy prices and customer demand due to the continuing weak
economy and mild weather," said James H. Miller, PPL's chairman,
president and chief executive officer. "Our relatively strong
ongoing earnings results for the quarter reflect the continued
benefits of cost-control actions we took early in the year." PPL
reaffirmed its 2009 forecast of $1.60 to $1.90 per share in
earnings from ongoing operations. PPL's 2009 forecast of reported
earnings is $0.84 to $1.14 per share, reflecting special items
recorded through Sept. 30, 2009. The 2009 forecast of reported
earnings does not reflect the expected gain on the sale of PPL's
Maine hydroelectric business. As previously announced, the sale of
six hydroelectric facilities to an affiliate of ArcLight Capital
Partners, LLC is expected to result in a special after-tax gain of
approximately $0.06 per share in the fourth quarter of 2009. This
figure excludes an additional special after-tax gain of $0.02 per
share in contingent consideration from ArcLight that would be
realized upon completion of PPL's previously announced sale of
three other hydroelectric facilities to the Penobscot River
Restoration Trust. PPL also reaffirmed its 2010 earnings forecast
of $3.10 to $3.50 per share. "We expect the significant increase in
earnings that we forecast for 2010 to come almost entirely from
increased margins in the company's supply business," Miller said.
"We remain convinced that our hedge programs, aggressively executed
when forward power prices for 2010 were much higher than they are
today, will provide greater earnings and cash flow predictability,"
he said. Third-Quarter 2009 Earnings Details PPL's reported
earnings in the third quarter of 2009 included special item charges
of $0.47 per share: $0.34 per share related to certain economic
hedge activity; $0.07 per share related to a change in the method
of accounting for certain expenditures for income tax purposes; and
$0.06 per share for additional tax expense related to the 2007
sales of its Latin American businesses. The tax accounting change,
for which IRS consent was received, is expected to provide a cash
flow benefit of approximately $200 million in 2009, as well as
smaller cash flow benefits in future periods. Reported earnings are
calculated in accordance with generally accepted accounting
principles (GAAP). Earnings from ongoing operations is a non-GAAP
financial measure that excludes special items. Special items
include charges or credits that are unusual or nonrecurring.
Special items also include unrealized gains and losses from
energy-related non-trading economic hedges, foreign
currency-related economic hedges and impairments of securities in
PPL's nuclear decommissioning trust funds. (Dollars in millions,
except for per share amounts) 3rd Quarter ----------- 2009 2008 %
Change ---- ---- -------- Reported Earnings $20 $203 -90% Reported
Earnings per Share $0.05 $0.54 -91% Earnings from Ongoing
Operations $195 $168 +16% Per Share Earnings from Ongoing
Operations $0.52 $0.45 +16% (See the tables at the end of the news
release for details as to the reconciliation of reported earnings
versus earnings from ongoing operations.) Third-Quarter and
Nine-Month 2009 Earnings by Business Segment The following chart
shows PPL's earnings by business segment for the third quarter and
first nine months of 2009, compared with the same periods of 2008.
3rd Quarter Year to Date ----------- ------------ (per share) 2009
2008 2009 2008 ---- ---- ---- ---- Earnings from ongoing operations
Supply $0.33 $0.16 $0.63 $0.60 Pennsylvania Delivery 0.07 0.09 0.26
0.34 International Delivery 0.12 0.20 0.54 0.62 ---- ---- ---- ----
Total $0.52 $0.45 $1.43 $1.56 ===== ===== ===== ===== Special Items
Supply $(0.41) $0.10 $(0.67) $0.18 Pennsylvania Delivery - (0.01)
(0.01) (0.01) International Delivery (0.06) - (0.08) - ----- ---
----- --- Total $(0.47) $0.09 $(0.76) $0.17 ====== ===== ======
===== Reported earnings Supply $(0.08) $0.26 $(0.04) $0.78
Pennsylvania Delivery 0.07 0.08 0.25 0.33 International Delivery
0.06 0.20 0.46 0.62 ---- ---- ---- ---- Total $0.05 $0.54 $0.67
$1.73 ===== ===== ===== ===== (For more details and a breakout of
special items by segment, see the reconciliation tables at the end
of this news release.) Key Factors Impacting Business Segment
Earnings from Ongoing Operations Supply Segment PPL's supply
business segment primarily consists of the domestic energy
generation and marketing operations of PPL Energy Supply. Earnings
from ongoing operations for PPL's supply business segment increased
in the third quarter of 2009 by $0.17 per share compared with 2008.
Directly affecting this comparison were trading losses in 2008,
caused by a dramatic decline in wholesale energy prices and lack of
market liquidity. Excluding this impact, energy margins were flat
for the quarter. Positive drivers of this segment's quarterly
results include higher value from baseload generation, higher
Eastern capacity prices and higher wholesale volumes in the West.
Partially offsetting these benefits were lower margins on
load-following agreements, higher operation and maintenance
expenses at PPL's Susquehanna nuclear plant and higher
depreciation. Earnings from ongoing operations for PPL's supply
business segment increased during the first nine months of 2009 by
$0.03 per share compared with a year ago. This comparison also
reflects the effect of trading losses in 2008. Positive earnings
drivers for the nine-month period in 2009 were higher wholesale
volumes in the West; higher capacity prices in the East; higher
baseload generation; and a gain recorded on the repurchase of a
portion of PPL Energy Supply's debt in the first quarter of 2009.
Partially offsetting these favorable impacts were lower marketing
margins, due to lower margins on load-following agreements; higher
average fuel expenses; higher income taxes; and higher
depreciation. Pennsylvania Delivery Segment PPL's Pennsylvania
delivery business segment includes the regulated electric delivery
operations of PPL Electric Utilities and included the delivery
operations of PPL's natural gas and propane businesses prior to
their divestiture in October 2008. Earnings from ongoing operations
for PPL's Pennsylvania delivery business segment declined in the
third quarter of 2009 by $0.02 per share compared with a year ago.
This decline was primarily due to lower delivery revenues,
resulting from the impacts of weather and the economy, and higher
financing costs. Earnings from ongoing operations for PPL's
Pennsylvania delivery business segment declined during the first
nine months of 2009 by $0.08 per share compared with a year ago.
This decline was primarily due to lower delivery revenues, higher
financing costs, and the divestiture of PPL's natural gas and
propane businesses. Partially offsetting this decrease were lower
operation and maintenance expenses. International Delivery Segment
PPL's international delivery business segment primarily includes
the regulated electricity delivery operations of Western Power
Distribution in the United Kingdom. Earnings from ongoing
operations for PPL's international delivery business segment
declined in the third quarter of 2009 by $0.08 per share compared
with a year ago. This decline was the net result of higher U.K. and
U.S. income taxes, less favorable currency exchange rates and lower
financing costs. Earnings from ongoing operations for PPL's
international delivery business segment declined during the first
nine months of 2009 by $0.08 per share compared with a year ago.
This decline was the net result of less favorable currency exchange
rates, higher U.S. income taxes, lower operating expenses, lower
financing costs and lower U.K. income taxes. 2009 Earnings Forecast
PPL projects earnings from ongoing operations of $1.60 to $1.90 per
share in 2009, compared with $2.02 per share in 2008. This
projected decline is primarily driven by less favorable currency
exchange rates in the U.K. and higher operation and maintenance
expenses, higher depreciation, and lower delivery revenues in
Pennsylvania. These negative factors are expected to be partially
offset by higher energy margins and lower financing costs. 2010
Earnings Forecast PPL has reaffirmed its 2010 earnings forecast in
a range of $3.10 to $3.50 per share. PPL has hedged nearly 100
percent of its expected baseload generation output for 2010 and
continues to forecast strong growth in 2010 energy margins based on
hedged power and fuel prices, as well as hedged capacity prices in
the PJM Interconnection. PPL Corporation, headquartered in
Allentown, Pa., controls or owns more than 12,000 megawatts of
generating capacity in the United States, sells energy in key U.S.
markets and delivers electricity to more than 4 million customers
in Pennsylvania and the United Kingdom. More information is
available at http://www.pplweb.com/. (Note: All references to
earnings per share in the text and tables of this news release are
stated in terms of diluted earnings per share.) Conference Call and
Webcast PPL invites interested parties to listen to the live
webcast of management's teleconference with financial analysts
about third-quarter 2009 financial results at 9 a.m. EDT Thursday,
Oct. 29. The meeting is available online live, in audio format,
along with slides of the presentation, on PPL's Web site:
http://www.pplweb.com/. The webcast will be available for replay on
the PPL Web site for 30 days. Interested individuals also can
access the live conference call via telephone at 702-696-4769 (ID#
36219786). "Earnings from ongoing operations" excludes the impact
of special items. Special items include charges or credits that are
unusual or nonrecurring. Special items also include unrealized
gains and losses from energy-related non-trading economic hedges,
foreign currency-related economic hedges and impairments of
securities in PPL's nuclear decommissioning trust funds. The
energy-related, non-trading economic hedges are used to hedge a
portion of the economic value of PPL's generation assets and PPL's
load-following and retail activities. This economic value is
subject to changes in fair value due to market price volatility of
the input and output commodities (e.g., fuel and power). Also
included in this special item is the ineffective portion of
qualifying cash flow hedges. The foreign currency-related economic
hedges are used to hedge a portion of the net income of the
international delivery business segment. This economic value in
U.S. dollars is subject to changes in the British Pound Sterling to
the U.S. dollar exchange rate. Management believes that the
exclusion of such amounts provides a better matching of earnings
from ongoing operations to the actual amounts settled for PPL's
underlying hedged assets. Earnings from ongoing operations should
not be considered as an alternative to reported earnings, or net
income attributable to PPL, which is an indicator of operating
performance determined in accordance with generally accepted
accounting principles (GAAP). PPL believes that earnings from
ongoing operations, although a non-GAAP measure, is also useful and
meaningful to investors because it provides them with PPL's
underlying earnings performance as another criterion in making
their investment decisions. PPL's management also uses earnings
from ongoing operations in measuring certain corporate performance
goals. Other companies may use different measures to present
financial performance. Statements contained in this news release,
including statements with respect to future earnings, energy
prices, margins and sales, growth, revenues, expenses, cash flow,
asset disposition, marketing performance, hedging, regulation,
corporate strategy and generating capacity and performance, are
"forward-looking statements" within the meaning of the federal
securities laws. Although PPL Corporation believes that the
expectations and assumptions reflected in these forward-looking
statements are reasonable, these statements are subject to a number
of risks and uncertainties, and actual results may differ
materially from the results discussed in the statements. The
following are among the important factors that could cause actual
results to differ materially from the forward-looking statements:
market demand and prices for energy, capacity and fuel; weather
conditions affecting customer energy usage and operating costs;
competition in power markets; the effect of any business or
industry restructuring; the profitability and liquidity of PPL
Corporation and its subsidiaries; new accounting requirements or
new interpretations or applications of existing requirements;
operating performance of plants and other facilities; environmental
conditions and requirements and the related costs of compliance,
including environmental capital expenditures and emission allowance
and other expenses; system conditions and operating costs;
development of new projects, markets and technologies; performance
of new ventures; asset acquisitions and dispositions; any impact of
hurricanes or other severe weather on our business, including any
impact on fuel prices; receipt of necessary government permits,
approvals, rate relief and regulatory cost recovery; capital market
conditions and decisions regarding capital structure; the impact of
state, federal or foreign investigations applicable to PPL
Corporation and its subsidiaries; the outcome of litigation against
PPL Corporation and its subsidiaries; stock price performance; the
market prices of equity securities and the impact on pension income
and resultant cash funding requirements for defined benefit pension
plans; the securities and credit ratings of PPL Corporation and its
subsidiaries; political, regulatory or economic conditions in
states, regions or countries where PPL Corporation or its
subsidiaries conduct business, including any potential effects of
threatened or actual terrorism or war or other hostilities; foreign
exchange rates; new state, federal or foreign legislation,
including new tax legislation; and the commitments and liabilities
of PPL Corporation and its subsidiaries. Any such forward-looking
statements should be considered in light of such important factors
and in conjunction with PPL Corporation's Form 10-K and other
reports on file with the Securities and Exchange Commission. PPL
CORPORATION AND SUBSIDIARY COMPANIES CONDENSED CONSOLIDATED
FINANCIAL INFORMATION (a) Condensed Consolidated Balance Sheet
(Unaudited) (Millions of Dollars) September 30, December 31, 2009
2008 (b) ---- -------- Assets Cash and cash equivalents $696 $1,100
Price risk management assets - current 1,685 1,224 Assets held for
sale 175 Other current assets 1,743 2,059 Investments 582 522
Property, plant and equipment Electric plant 20,757 20,033 Gas and
oil plant 68 68 Other property 163 156 --- --- 20,988 20,257 Less:
accumulated depreciation 8,111 7,882 ----- ----- 12,877 12,375
Regulatory assets 493 737 Goodwill and other intangibles 1,427
1,400 Price risk management assets - noncurrent 1,839 1,392 Other
noncurrent assets 427 596 --- --- Total assets $21,944 $21,405
======= ======= Liabilities and Equity Short-term debt (including
current portion of long-term debt) $620 $1,375 Price risk
management liabilities - current 1,425 1,324 Other current
liabilities 1,748 1,603 Long-term debt (less current portion) 7,250
7,142 Deferred income taxes and investment tax credits 2,203 1,764
Price risk management liabilities - noncurrent 927 836 Accrued
pension obligations 839 899 Other noncurrent liabilities 995 1,066
Common stock and capital in excess of par value 2,268 2,200
Earnings reinvested 3,726 3,862 Accumulated other comprehensive
loss (376) (985) Noncontrolling interests 319 319 --- --- Total
liabilities and equity $21,944 $21,405 ======= ======= (a) The
Financial Statements in this news release have been condensed and
summarized for purposes of this presentation. Please refer to PPL
Corporation's periodic filings with the Securities and Exchange
Commission for full financial statements, including note
disclosure. (b) Certain amounts from 2008 have been reclassified to
conform to the current year presentation. Condensed Consolidated
Income Statement (Unaudited) (Millions of Dollars, Except per Share
Data) 3 Months Ended 9 Months Ended September 30, September 30,
--------------- --------------- 2009 (a) 2008 (a)(b) 2009 (a) 2008
(a)(b) -------- ----------- -------- ----------- Operating Revenues
Utility $955 $1,007 $2,901 $3,108 Unregulated retail electric and
gas 34 43 108 110 Wholesale energy marketing (c) Realized 999 748
2,564 1,610 Unrealized economic activity (307) 1,157 (67) 361 Net
energy trading margins 7 (132) 2 (82) Energy-related businesses 117
148 321 394 --- --- --- --- Total Operating Revenues 1,805 2,971
5,829 5,501 ----- ----- ----- ----- Operating Expenses Operation
Fuel 264 305 708 734 Energy purchases (c) Realized 750 500 2,049
1,126 Unrealized economic activity (79) 1,020 255 157 Other
operation and maintenance 317 361 1,043 1,095 Amortization of
recoverable transition costs 73 73 227 217 Depreciation 120 117 343
345 Taxes, other than income 70 77 209 224 Energy-related
businesses 109 134 298 361 --- --- --- --- Total Operating Expenses
1,624 2,587 5,132 4,259 ----- ----- ----- ----- Operating Income
181 384 697 1,242 Other Income - net 9 8 38 32 Other-Than-Temporary
Impairments 6 18 16 Interest Expense 106 119 294 335 --- --- ---
--- Income from Continuing Operations Before Income Taxes 84 267
423 923 Income Taxes 34 57 101 277 -- -- --- --- Income from
Continuing Operations After Income Taxes 50 210 322 646 Income
(Loss) from Discontinued Operations (net of income taxes) (24) (2)
(53) 22 --- -- --- -- Net Income 26 208 269 668 Net Income
Attributable to Noncontrolling Interests 6 5 15 15 -- -- -- -- Net
Income Attributable to PPL Corporation $20 $203 $254 $653 === ====
==== ==== Amounts Attributable to PPL Corporation: Income from
Continuing Operations After Income Taxes $44 $205 $307 $631 Income
(Loss) from Discontinued Operations (net of income taxes) (24) (2)
(53) 22 --- -- --- -- Net Income $20 $203 $254 $653 === ==== ====
==== Earnings Per Share of Common Stock - Basic Earnings from
Ongoing Operations $0.52 $0.45 $1.43 $1.56 Special Items (0.47)
0.09 (0.76) 0.18 ----- ---- ----- ---- Net Income Available to PPL
Corporation Common Shareowners $0.05 $0.54 $0.67 $1.74 ===== =====
===== ===== Earnings Per Share of Common Stock - Diluted Earnings
from Ongoing Operations $0.52 $0.45 $1.43 $1.56 Special Items
(0.47) 0.09 (0.76) 0.17 ----- ---- ----- ---- Net Income Available
to PPL Corporation Common Shareowners $0.05 $0.54 $0.67 $1.73 =====
===== ===== ===== Weighted-Average Shares of Common Stock
Outstanding (thousands) Basic 376,384 374,290 375,795 373,394
Diluted 376,716 375,096 376,113 374,984 (a) Earnings in the 2009
and 2008 periods were impacted by several special items, as
described in the text and tables of this news release. Earnings
from ongoing operations excludes the impact of these special items.
(b) Certain amounts from 2008 have been reclassified to conform to
the current year presentation. (c) PPL enters into certain
non-trading energy or energy-related contracts to hedge future cash
flows that are not eligible for hedge accounting, or where hedge
accounting is not elected. Consistent with the treatment of the
hedged item, unrealized and realized gains and losses on these
transactions are reflected in "Wholesale energy marketing" or
"Energy purchases." Condensed Consolidated Statements of Cash Flows
(Unaudited) (Millions of Dollars) 9 Months Ended September 30,
------------- 2009 2008 ---- ---- Cash Flows from Operating
Activities Net Income $269 $668 Adjustments to reconcile net income
to net cash provided by operating activities: Depreciation 345 347
Amortization of recoverable transition costs and other 286 286
Defined benefits (29) (55) Deferred income taxes and investment tax
credits 20 (56) Gains related to the extinguishment of notes (29)
Impairment of assets 109 53 Unrealized (gains) losses on
derivatives and other hedging activities 256 (83) Changes in
working capital (34) (69) Other operating activities 54 70 -- --
Net cash provided by operating activities 1,247 1,161 ----- -----
Cash Flows from Investing Activities Expenditures for property,
plant and equipment (821) (979) Net expenditures for intangible
assets (58) (272) Net proceeds from (purchases of) other
investments 150 (14) Net (increase) decrease in restricted cash and
cash equivalents 170 (70) Other investing activities (32) (15) ---
--- Net cash used in investing activities (591) (1,350) ---- ------
Cash Flows from Financing Activities Net issuances (retirements) of
long-term debt (618) 400 Repurchase of common stock due to the
repurchase program (38) Payment of common stock dividends (386)
(365) Net increase (decrease) in short-term debt (70) 109 Other
financing activities 14 10 -- -- Net cash provided by (used in)
financing activities (1,060) 116 ------ --- Effect of Exchange
Rates on Cash and Cash Equivalents (5) -- Net Decrease in Cash and
Cash Equivalents (404) (78) Cash and cash equivalents at beginning
of period 1,100 430 Cash and cash equivalents included in assets
held for sale (3) -- Cash and cash equivalents at end of period
$696 $349 ==== ==== Key Indicators 12 Months Ended September 30,
------------- Financial 2009 2008 ---- ---- Dividends declared per
share $1.37 $1.31 Book value per share (a) $14.92 $14.91 Market
price per share (a) $30.34 $37.02 Dividend yield (a) 4.5% 3.5%
Dividend payout ratio (b) 97% 46% Dividend payout ratio - earnings
from ongoing operations (b)(c) 72% 61% Price/earnings ratio (a)(b)
21.5 13.0 Price/earnings ratio - earnings from ongoing operations
(a)(b)(c) 16.1 17.1 Return on average common equity 9.78% 19.68%
Return on average common equity - earnings from ongoing operations
(c) 13.39% 15.62% (a) End of period. (b) Based on diluted earnings
per share. (c) Calculated using earnings from ongoing operations,
which excludes the impact of special items, as described in the
text and tables of this news release. Operating - Domestic &
International Electricity Sales 3 Months Ended 9 Months Ended
September 30, September 30, --------------- --------------- Percent
Percent (millions of kwh) 2009 2008 Change 2009 2008 Change ----
---- ------ ---- ---- ------ Domestic Retail Delivered (a) 9,061
9,624 (5.8%) 28,086 29,025 (3.2%) Supplied 9,607 10,207 (5.9%)
29,748 30,732 (3.2%) International Delivered United Kingdom 5,825
6,186 (5.8%) 19,806 20,889 (5.2%) Domestic Wholesale East 7,914
8,783 (9.9%) 20,446 21,246 (3.8%) West NorthWestern Energy 571 633
(9.8%) 1,698 1,869 (9.1%) Other West 2,273 3,010 (24.5%) 6,782
8,759 (22.6%) (a) Electricity delivered to retail customers
represents the kwh delivered to customers within PPL Electric
Utilities Corporation's service territory. Reconciliation of
Business Segment Earnings from Ongoing Operations and Reported
Earnings (Diluted) 3rd Quarter 2009 (millions of dollars)
---------------- --------------------- PA Int'l Supply Delivery
Delivery Total ------ -------- -------- ----- Earnings from Ongoing
Operations $124 $27 $44 $195 Special Items Unrealized losses from
energy- related, non-trading economic hedges (130) (130) Unrealized
gains from foreign currency economic hedges 4 4 Income taxes -
Latin American businesses (24) (24) Changes in tax accounting
method (25) (25) --- --- --- Total special items (155) (20) (175)
---- --- --- ---- Reported Earnings ($31) $27 $24 $20 ==== === ===
=== 3rd Quarter 2009 (per share) ---------------- ----------- PA
Int'l Supply Delivery Delivery Total ------ -------- -------- -----
Earnings from Ongoing Operations $0.33 $0.07 $0.12 $0.52 Special
Items Unrealized losses from energy- related, non-trading economic
hedges (0.34) (0.34) Unrealized gains from foreign currency
economic hedges Income taxes - Latin American businesses (0.06)
(0.06) Changes in tax accounting method (0.07) (0.07) ----- -----
----- Total special items (0.41) (0.06) (0.47) ----- ----- -----
----- Reported Earnings ($0.08) $0.07 $0.06 $0.05 ====== =====
===== ===== Year-to-Date September 30, 2009 (millions of dollars)
------------------------------- --------------------- PA Int'l
Supply Delivery Delivery Total ------ -------- -------- -----
Earnings from Ongoing Operations $239 $99 $202 $540 Special Items
Unrealized losses from energy- related, non-trading economic hedges
(168) (168) Unrealized losses from foreign currency economic hedges
(2) (2) Adjustments - nuclear decom. trust investments (Q1, '09;
Q2, '09; Q3, '09) (1) (1) Impairments & other impacts -
emission allowances (Q1, '09) (15) (15) Impairments - assets held
for sale & other (Q1, '09; Q2, '09) (36) (1) (1) (38) Workforce
reduction (Q1, '09) (6) (5) (2) (13) Income taxes - Latin American
businesses (Q3, '09) (24) (24) Changes in tax accounting method
(Q3, '09) (25) (25) --- -- --- --- Total special items (251) (6)
(29) (286) ---- -- --- ---- Reported Earnings ($12) $93 $173 $254
==== === ==== ==== Year-to-Date September 30, 2009 (per share)
------------------------------- ----------- PA Int'l Supply
Delivery Delivery Total ------ -------- -------- ----- Earnings
from Ongoing Operations $0.63 $0.26 $0.54 $1.43 Special Items
Unrealized losses from energy- related, non-trading economic hedges
(0.45) (0.45) Unrealized losses from foreign currency economic
hedges (0.01) (0.01) Adjustments - nuclear decom. trust investments
(Q1, '09; Q2, '09; Q3, '09) Impairments & other impacts -
emission allowances (Q1, '09) (0.04) (0.04) Impairments - assets
held for sale & other (Q1, '09; Q2, '09) (0.10) (0.10)
Workforce reduction (Q1, '09) (0.01) (0.01) (0.01) (0.03) Income
taxes - Latin American businesses (Q3, '09) (0.06) (0.06) Changes
in tax accounting method (Q3, '09) (0.07) (0.07) ----- ----- -----
----- Total special items (0.67) (0.01) (0.08) (0.76) ----- -----
----- ----- Reported Earnings ($0.04) $0.25 $0.46 $0.67 ======
===== ===== ===== 12 Months Ended September 30, 2009 (millions of
dollars) ---------------------------------- ---------------------
PA Int'l Supply Delivery Delivery Total ------ -------- --------
----- Earnings from Ongoing Operations $317 $138 $260 $715 Special
Items Unrealized losses from energy- related, non-trading economic
hedges (38) (38) Unrealized losses from foreign currency economic
hedges (2) (2) Sale of gas and propane businesses (Q4, '08; Q1,
'09) (1) (1) Adjustments - nuclear decom. trust investments (Q4,
'08; Q1, '09; Q2, '09; Q3, '09) (13) (13) Impairments & other
impacts - emission allowances (Q4, '08; Q1, '09) (13) (13)
Impairments - assets held for sale & other (Q4, '08; Q1, '09;
Q2, '09) (52) (1) (2) (55) Workforce reduction (Q1, '09) (6) (5)
(2) (13) Income taxes - Latin American businesses (Q3, '09) (24)
(24) Changes in tax accounting method (Q3, '09) (25) (25) --- --
--- --- Total special items (147) (7) (30) (184) ---- -- --- ----
Reported Earnings $170 $131 $230 $531 ==== ==== ==== ==== 12 Months
Ended September 30, 2009 (per share)
---------------------------------- ----------- PA Int'l Supply
Delivery Delivery Total ------ -------- -------- ----- Earnings
from Ongoing Operations $0.84 $0.36 $0.69 $1.89 Special Items
Unrealized losses from energy- related, non-trading economic hedges
(0.10) (0.10) Unrealized losses from foreign currency economic
hedges (0.01) (0.01) Sale of gas and propane businesses (Q4, '08;
Q1, '09) Adjustments - nuclear decom. trust investments (Q4, '08;
Q1, '09; Q2, '09; Q3, '09) (0.03) (0.03) Impairments & other
impacts - emission allowances (Q4, '08; Q1, '09) (0.04) (0.04)
Impairments - assets held for sale & other (Q4, '08; Q1, '09;
Q2, '09) (0.14) (0.14) Workforce reduction (Q1, '09) (0.01) (0.01)
(0.01) (0.03) Income taxes - Latin American businesses (Q3, '09)
(0.06) (0.06) Changes in tax accounting method (Q3, '09) (0.07)
(0.07) ----- ----- ----- ----- Total special items (0.39) (0.01)
(0.08) (0.48) ----- ----- ----- ----- Reported Earnings $0.45 $0.35
$0.61 $1.41 ===== ===== ===== ===== Reconciliation of Business
Segment Earnings from Ongoing Operations and Reported Earnings
(Diluted) 3rd Quarter 2008 (millions of dollars) ----------------
--------------------- PA Int'l Supply Delivery Delivery Total
------ -------- -------- ----- Earnings from Ongoing Operations $59
$36 $73 $168 Special Items Unrealized gains from energy-related,
non-trading economic hedges 67 67 Impairments & other impacts -
emission allowances (27) (27) Adjustments - nuclear decom. trust
investments (1) (1) Sale of gas and propane businesses (4) (4) --
-- -- Total special items 39 (4) 35 -- -- --- -- Reported Earnings
$98 $32 $73 $203 === === === ==== 3rd Quarter 2008 (per share)
---------------- ----------- PA Int'l Supply Delivery Delivery
Total ------ -------- -------- ----- Earnings from Ongoing
Operations $0.16 $0.09 $0.20 $0.45 Special Items Unrealized gains
from energy-related, non-trading economic hedges 0.18 0.18
Impairments & other impacts - emission allowances (0.07) (0.07)
Adjustments - nuclear decom. trust investments (0.01) (0.01) Sale
of gas and propane businesses (0.01) (0.01) ---- ----- ----- Total
special items 0.10 (0.01) 0.09 ---- ----- ----- ---- Reported
Earnings $0.26 $0.08 $0.20 $0.54 ===== ===== ===== =====
Year-to-Date September 30, 2008 (millions of dollars)
------------------------------- --------------------- PA Int'l
Supply Delivery Delivery Total ------ -------- -------- -----
Earnings from Ongoing Operations $225 $128 $233 $586 Special Items
Unrealized gains from energy-related, non-trading economic hedges
121 121 Impairments & other impacts - emission allowances (Q3,
'08) (27) (27) Adjustments - nuclear decom. trust investments (Q2,
'08; Q3, '08) (5) (5) Sale of gas and propane businesses (Q2, '08;
Q3, '08) (5) (5) Off-site remediation of ash basin leak (Q2, '08) 1
1 Montana basin seepage litigation (Q1, '08; Q2, '08) (5) (5)
Synfuel tax adjustment (Q1, '08) (13) (13) --- -- --- Total special
items 72 (5) 67 -- -- ---- -- Reported Earnings $297 $123 $233 $653
==== ==== ==== ==== Year-to-Date September 30, 2008 (per share)
------------------------------- ----------- PA Int'l Supply
Delivery Delivery Total ------ -------- -------- ----- Earnings
from Ongoing Operations $0.60 $0.34 $0.62 $1.56 Special Items
Unrealized gains from energy-related, non-trading economic hedges
0.32 0.32 Impairments & other impacts - emission allowances
(Q3, '08) (0.07) (0.07) Adjustments - nuclear decom. trust
investments (Q2, '08; Q3, '08) (0.02) (0.02) Sale of gas and
propane businesses (Q2, '08; Q3, '08) (0.01) (0.01) Off-site
remediation of ash basin leak (Q2, '08) Montana basin seepage
litigation (Q1, '08; Q2, '08) (0.01) (0.01) Synfuel tax adjustment
(Q1, '08) (0.04) (0.04) ----- ----- ----- Total special items 0.18
(0.01) 0.17 ---- ----- ----- ---- Reported Earnings $0.78 $0.33
$0.62 $1.73 ===== ===== ===== ===== 12 Months Ended September 30,
2008 (millions of dollars) ----------------------------------
--------------------- PA Int'l Supply Delivery Delivery Total
------ -------- -------- ----- Earnings from Ongoing Operations
$333 $163 $315 $811 Special Items Unrealized gains from
energy-related, non-trading economic hedges 133 133 Impairments
& other impacts - emission allowances (Q3, '08) (27) (27)
Adjustments - nuclear decom. trust investments (Q2, '08; Q3, '08)
(5) (5) Sale of gas and propane businesses (Q4, '07; Q2, '08; Q3,
'08) (26) (26) Off-site remediation of ash basin leak (Q2, '08) 1 1
Montana basin seepage litigation (Q1, '08; Q2, '08) (5) (5) Synfuel
tax adjustment (Q1, '08) (13) (13) Workforce reduction (Q4, '07)
(4) (1) (4) (9) Sale of Latin American businesses (Q4, '07) 213 213
Impairment of transmission rights (Q4, '07) (1) (1) -- --- --- --
Total special items 79 (27) 209 261 -- --- --- --- Reported
Earnings $412 $136 $524 $1,072 ==== ==== ==== ====== 12 Months
Ended September 30, 2008 (per share)
---------------------------------- ----------- PA Int'l Supply
Delivery Delivery Total ------ -------- -------- ----- Earnings
from Ongoing Operations $0.90 $0.43 $0.83 $2.16 Special Items
Unrealized gains from energy-related, non-trading economic hedges
0.35 0.35 Impairments & other impacts - emission allowances
(Q3, '08) (0.07) (0.07) Adjustments - nuclear decom. trust
investments (Q2, '08; Q3, '08) (0.02) (0.02) Sale of gas and
propane businesses (Q4, '07; Q2, '08; Q3, '08) (0.07) (0.07)
Off-site remediation of ash basin leak (Q2, '08) Montana basin
seepage litigation (Q1, '08; Q2, '08) (0.01) (0.01) Synfuel tax
adjustment (Q1, '08) (0.04) (0.04) Workforce reduction (Q4, '07)
(0.01) (0.01) (0.02) Sale of Latin American businesses (Q4, '07)
0.57 0.57 Impairment of transmission rights (Q4, '07) ---- -----
---- ---- Total special items 0.20 (0.07) 0.56 0.69 ---- ----- ----
---- Reported Earnings $1.10 $0.36 $1.39 $2.85 ===== ===== =====
===== DATASOURCE: PPL Corporation CONTACT: For news media, George
Biechler, +1-610-774-5997; For financial analysts, Joseph P.
Bergstein, +1-610-774-5609 Web Site: http://www.pplweb.com/
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