PPL Reports Increased First-Quarter Results Compared to a Year Ago; Reaffirms Earnings Forecasts for 2003

PPL Corporation (NYSE: PPL) today announced increases in both reported earnings and earnings from core operations for the first quarter of 2003 compared to a year ago.

Reported earnings for the first quarter of 2003 were $1.43 per share. A year ago, PPL reported a loss per share of $0.02 due primarily to a non-cash charge related to changes in accounting rules for goodwill that affected its Latin American investments. PPL's first-quarter 2003 earnings benefited from an unusual item of $0.37 per share due to the adoption of a new accounting rule addressing asset retirement obligations.

Income from core operations, which excludes unusual items, was $1.06 per share in the first quarter of 2003, an increase of about 3 percent over the $1.03 per share reported for the first quarter of 2002.

"The major ingredient in our continued success remains the effective operation of power plants in key U.S. markets with favorable long-term contracts for both the electricity produced and the fuel needed to run the plants," said William F. Hecht, PPL chairman, president and chief executive officer. "This managed-risk approach to electricity marketing is buttressed by the cost-effective performance of our electricity delivery businesses.

"Despite much higher natural gas and oil costs at some of our power plants, PPL's hedging strategy continued to work as designed during the first quarter," said Hecht. "As a result of our effective management of price and fuel risks, our first-quarter performance keeps us on track to achieve long- term, steady growth and profitability."

Hecht said PPL's strategic balancing of generation, marketing and delivery was instrumental in its first-quarter success. Although PPL's electricity sales margins in the Northeastern United States were lower than in the first quarter of 2002, that shortfall was more than overcome by strong performance in the company's electricity delivery businesses.

"Excellent results from our highly efficient electricity delivery businesses in the Northeastern United States and in the United Kingdom allowed us to improve our core earnings over last year," Hecht said. "In addition, we recognized increased margins from our operations in Montana, which resulted from higher average sales prices and an increase in the volume of wholesale energy sales."

Hecht said PPL's first-quarter earnings also benefited from reduced interest expense due primarily to the voluntary retirement of higher-cost debt. These benefits were offset by the dilutive effects of additional shares of common stock outstanding and lower pension income. In September of 2002, PPL issued $500 million of common stock in a public offering. During the fourth quarter of 2002, the company issued an additional $41 million through its structured equity shelf program.

PPL also announced that it has increased the amount of its planned 2003 common stock issuance from $300 million to $400 million. So far in 2003, PPL has issued about $100 million under its structured equity shelf and dividend reinvestment programs.

Hecht said PPL remains on track to meet previously stated 2003 earnings forecasts of $3.75 to $4.05 per share for reported earnings and $3.45 to $3.75 per share in income from core operations. The company also is reaffirming its long-term forecast of a 5 percent to 8 percent compound annual growth rate based on 2002 earnings from core operations of $3.54 per share.

The difference between the 2003 forecast for reported earnings and the forecast of earnings from core operations reflects two unusual items resulting from changes in accounting rules. These items are expected to provide a net benefit to earnings of about $0.30 per share in 2003. The adoption, in the first quarter, of a new accounting rule addressing asset retirement obligations (a credit to earnings of $0.37 per share) is expected to be partially offset in the third quarter by the addition to the company's balance sheet of power plant financing arrangements that were reflected as operating leases in prior years (a charge to earnings of about $0.07 per share).

PPL's reported earnings per share for the 12 months ended March 31, 2003, were $2.86, compared to a loss of $0.31 per share for the same period of 2002.

Income from core operations for the 12 months ended March 31, 2003, was $3.60 per share compared to $3.74 per share for the same period of 2002. Earnings drivers for the period included the positive operating performance of PPL's electricity distribution company in the United Kingdom and improved margins on wholesale energy sales from the company's generating assets in Montana. These earnings improvements were offset by lower energy margins in the Northeastern United States, the dilutive effects of additional common shares outstanding, lower pension income and additional operating and maintenance expenses on new generating facilities.

  Reconciliation of Core Earnings & Reported Earnings

                                 Three Months Ended    Twelve Months Ended
                                     March 31,               March 31,
                                  2003        2002        2003       2002

  Earnings per share -
   Core Operations               $1.06       $1.03        $3.60     $3.74

    Unusual Items:
      Accounting method change -
       asset retirement
       obligations                0.37                     0.40
      Goodwill impairment                    (1.02)                 (1.03)
      CEMAR impairment                        (.03)       (0.60)    (1.50)
      CEMAR operating losses                              (0.14)
      Writedown of generation
       equipment                                          (0.17)
      Workforce reduction                                 (0.28)
      Tax benefit - Teesside                               0.05
      Cancellation of generation
       projects                                                     (0.60)
      WPD impairment                                                (0.80)
      Impact of Enron bankruptcy                                    (0.19)
      Accounting method change -
       pensions                                                      0.07
    Total Unusual Items           0.37       (1.05)       (0.74)    (4.05)
  Earnings (loss) per share
   - Reported                    $1.43       ($.02)       $2.86    ($0.31)

PPL's 2003 forecast excludes any positive or negative impact of exiting its Brazilian investment, CEMAR, and is based on the following key developments or assumptions: current forward wholesale electricity prices; common stock issuances of $400 million; the addition to the company's balance sheet, in the third quarter, of the variable interest entities related to power plants that currently are reflected as operating leases; and, effective January 2003, the adoption of a new accounting rule addressing asset retirement obligations.

PPL Corporation, headquartered in Allentown, Pa., controls about 11,500 megawatts of generating capacity in the United States, sells energy in key U.S. markets and delivers electricity to customers in Pennsylvania, the United Kingdom and Latin America.

(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.)

PPL invites interested parties to listen to the live Internet Webcast of management's teleconference with financial analysts about first-quarter financial results at 9 a.m. (EDT) on Tuesday, April 29. The teleconference is available online live, in audio format, on PPL's Internet Web site: 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 719-457-2679.


                        Consolidated Balance Sheet
                          (Millions of Dollars)

                                          March 31, 2003  Dec. 31, 2002 (a)
  Cash                                          $397                 $245
  Other current assets                         1,778                1,615
  Investments                                    645                  656
  Property, plant and equipment -- net
    Electric plant                             9,244                9,110
    Gas and oil plant                            202                  201
    Other property                               253                  252
                                               9,699                9,563
  Recoverable transition costs                 1,875                1,946
  Regulatory and other assets                  1,579                1,545
    Total assets                             $15,973              $15,570

  Liabilities and Equity
  Short-term debt (including current
   portion of long-term debt)                 $1,279               $1,309
  Other current liabilities                    1,373                1,327
  Long-term debt (less current portion)        6,116                5,901
  Deferred income taxes and investment
   tax credits                                 2,393                2,371
  Other noncurrent liabilities                 1,567                1,659
  Minority interest                               34                   36
  Company-obligated mandatorily
   redeemable securities                         661                  661
  Preferred stock                                 82                   82
  Earnings reinvested                          1,187                1,013
  Other common equity                          2,556                2,493
  Accumulated other comprehensive loss          (439)                (446)
  Treasury stock                                (836)                (836)
    Total liabilities and equity             $15,973              $15,570

  (a) Certain amounts have been reclassified to conform to the current year

                 Condensed Consolidated Income Statement
               (Millions of Dollars, Except per Share Data)

                                     3 Months Ended       12 Months Ended
                                       March 31,             March 31,
                                     2003    2002(a)       2003   2002(a)

  Operating Revenues
    Utility                        $1,020       $951     $3,745    $3,158
    Unregulated retail electric
     and gas                           52         49        185       266
    Wholesale energy marketing        298        193      1,141       930
    Net energy trading margins         (7)        14         (2)       26
    Energy-related businesses         124        147        536       666
                                    1,487      1,354      5,605     5,046
  Operating Expenses
    Fuel and purchased power          499        345      1,654     1,419
    Other operation and maintenance   278        274      1,136     1,084
    Amortization of recoverable
     transition costs                  71         53        244       233
    Depreciation                       96         86        377       285
    Energy-related businesses         121        129        535       563
    Taxes, other than income           65         61        236       175
    Other charges
      Write-down of international
       energy projects                  0          6        107       342
      Workforce reduction               0          0         75         0
      Cancellation of generation
       projects                         0          0         44       150
                                    1,130        954      4,408     4,251
  Operating Income                    357        400      1,197       795
  Other income - net                   10          7         35        18
  Interest expense                    108        130        537       412
  Income Before Income Taxes and
   Minority Interest                  259        277        695       401
  Income taxes                         69         86        193       221
  Minority interest                     1         26         53        22
  Income Before Cumulative Effect
   of a Change in Accounting
   Principles                         189        165        449       158
  Cumulative effect of a change in
   accounting principles (net of tax)  63       (150)        63      (140)
  Income Before Dividends and
   Distributions on Preferred
   Securities                         252         15        512        18
  Dividends and distributions
   on preferred securities             13         18         62        64
  Net Income (Loss)                  $239        ($3)      $450      ($46)

  Earnings per share of
   common stock - basic
    Income from core
     operations (b)                 $1.06      $1.03      $3.61     $3.75
    Unusual items                    0.37      (1.05)     (0.74)    (4.06)
    Net Income (loss)               $1.43     ($0.02)     $2.87    ($0.31)

  Earnings per share of
   common stock - diluted
    Income from core
     operations (b)                 $1.06      $1.03      $3.60     $3.74
    Unusual items                    0.37      (1.05)     (0.74)    (4.05)
    Net Income (loss)               $1.43     ($0.02)     $2.86    ($0.31)

  Average shares
   outstanding (thousands)
    Basic                         166,506    146,753    156,679   146,342
    Diluted                       167,016    147,091    157,225   146,835

  (a) Certain amounts have been reclassified to conform to the current year
  (b) Income in the 2003 and 2002 periods was impacted by several unusual
       items, as described in the text and tables of this news release.
       Income from core operations excludes the impact of these unusual

                              Key Indicators

                                          12 Months Ended   12 Months Ended
                                           March 31, 2003    March 31, 2002

  Dividends declared per share                  $1.465             $1.155
  Book value per share (a)                      $14.71             $12.33
  Market price per share (a)                    $35.61             $39.61
  Dividend yield (a)                              4.1%               2.9%
  Dividend payout ratio (b)                        51%                (d)
  Dividend payout ratio -
   core operations (b)(c)                          41%                31%
  Price/earnings ratio (a)(b)                     12.5                (d)
  Price/earnings ratio -
   core operations (a)(b)(c)                       9.9               10.6
  Return on average common equity               20.93%             -2.17%
  Return on average common equity - core
   operations (c)                               20.91%             24.34%

  (a) End of period.
  (b) Based on diluted earnings per share.
  (c) Calculated using income from core operations, which excludes the
      impact of unusual items, as described in the text and tables of this
      news release.
  (d) Calculation not meaningful due to net loss for the 12 months ended
      March 31, 2002.

  Operating - Domestic Electricity Sales

                                3 Months Ended          12 Months Ended
                                  March 31,                March 31,

  (millions of kwh)                        Percent                 Percent
                            2003     2002  Change    2003    2002  Change

    Delivered (a)          10,002   9,107    9.8%  36,003   33,869   6.3%
    Supplied               10,256   9,632    6.5%  37,445   36,508   2.6%

    East                    7,031   4,619   52.2%  27,328   18,500  47.7%
      NorthWestern /
       Montana Power (b)      827   1,366  (39.5%)  3,820    4,885 (21.8%)
      Other                 2,189   1,664   31.6%   8,420    4,756  77.0%

  (a) Electricity delivered to retail customers represents the kwh delivered
       to customers within PPL Electric Utilities Corp.'s service territory.
  (b) NorthWestern Corporation purchased The Montana Power Company's
       electric delivery business in February 2002, including Montana
       Power's rights under a power supply agreement with PPL Montana that
       expired on June 30, 2002. In July 2002, PPL EnergyPlus, on behalf of
       PPL Montana, began selling energy to NorthWestern Corporation under a
       new five-year agreement.

Income from core operations excludes the impact of unusual items. Income from core operations should not be considered as an alternative to net income, which is an indicator of operating performance determined in accordance with GAAP. PPL believes that income from core 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 income from core operations in measuring certain corporate performance goals. Other companies may use different measures to present financial performance.

Certain statements contained in this news release, including statements with respect to future earnings, energy prices, securities offerings, accounting treatment, and corporate strategy, 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 involve 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 variations affecting customer energy usage; competition in retail and wholesale 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; system conditions and operating costs; development of new projects, markets and technologies; performance of new ventures; political, regulatory or economic conditions in states, regions and countries where PPL Corporation or its subsidiaries conduct business; receipt of necessary governmental permits and approvals; capital market conditions; stock price performance; foreign exchange rates; and the commitments and liabilities of PPL Corporation and its subsidiaries. Any such forward-looking statements should be considered in light of such factors and in conjunction with PPL Corporation's Form 10-K and other reports on file with the Securities and Exchange Commission.

SOURCE: PPL Corporation

CONTACT: For Media: Dan McCarthy, +1-610-774-5758, or for financial
analysts: Tim Paukovits, +1-610-774-4124, both of PPL, or fax:

Web site: http://www.pplweb.com/

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