PPL (PPL) Q4 2009 earnings summary

Executive summary

• 2009 ongoing earnings were $738 million, or $1.95/share, exceeding forecast and 11% above the midpoint of the business plan; reported net income attributable to PPL was $407 million, or $1.08/share.

• Results absorbed $331 million of net special-item losses, including $225 million from energy-related economic activity; revenue declined to $7.556 billion from $8.007 billion.

Financial highlights

• Operating revenues were $7.556 billion in 2009 vs. $8.007 billion in 2008; operating income was $961 million vs. $1.793 billion.

• Net income attributable to PPL was $407 million vs. $930 million; diluted EPS was $1.08 vs. $2.47. Ongoing diluted EPS was $1.95 vs. $2.02.

• Cash from operating activities rose to $1.852 billion from $1.589 billion; capital expenditures were $1.265 billion, down from $1.503 billion.

Outlook and guidance

• 2010 EPS guidance was $3.10–$3.50; achieving the midpoint would mean nearly 70% growth over 2009 ongoing EPS.

• Supply earnings are projected higher on energy-margin growth supported by hedged power and fuel prices and PJM capacity prices; higher depreciation, financing and O&M costs are offsets.

• Pennsylvania Delivery earnings are projected lower on weak demand, lower distribution revenues and higher O&M, partly offset by lower financing costs; International Delivery earnings are also projected lower.