PPL (PPL) Q4 2015 earnings summary

Executive summary

• 2015 marked the shift to a fully regulated utility portfolio after the June 1 spinoff of competitive generation; total shareowner return exceeded 6%, and ongoing EPS rose 9% to $2.21.

• Reported net income fell to $682 million from $1.737 billion, chiefly reflecting the $879 million spinoff loss and only five months of Supply segment earnings.

Financial highlights

• Operating revenue was $7.669 billion in 2015 vs. $7.852 billion in 2014; operating income was $2.831 billion vs. $2.867 billion.

• Net income was $682 million and diluted EPS $1.01, vs. $1.737 billion and $2.61 in 2014; continuing-operations diluted EPS rose to $2.37 from $2.16.

• Adjusted for special items, earnings from ongoing operations were $1.489 billion, or $2.21 diluted EPS, vs. $1.349 billion, or $2.03, in 2014.

• Q4 revenue was $1.780 billion, operating income $617 million, continuing-operations income $405 million and net income $399 million; Q4 2014 net income was $695 million.

Outlook and guidance

• 2016 EPS guidance is $2.25-$2.45, midpoint $2.35, more than 6% above 2015 ongoing EPS of $2.21.

• Excluding special items, 2016 earnings are projected higher, led by Kentucky and Pennsylvania; U.K. earnings are expected relatively flat and Corporate and Other costs relatively flat.

• 2016 U.K. currency exposure is 95% hedged at an average $1.56 per pound; expected earnings growth includes projected RIIO inflation and annual adjustments.

• The quarterly dividend increased to $0.38 per share, equivalent to $1.52 annualized, effective with the April 2016 payment.