PPL's Earnings Surge by 47 Percent for Third Quarter; Company Forecasts Double-Digit Growth in 2002
PRNewswire
ALLENTOWN, Pa.

For the third time this year, PPL Corp. (NYSE: PPL) Wednesday (10/25) reported record quarterly earnings. This marks the seventh consecutive quarter in which PPL has met or exceeded the consensus earnings estimate of financial analysts.

(Photo: http://www.newscom.com/cgi-bin/prnh/19981015/PHTH025 )

When adjusted to exclude the benefit of nonrecurring items, the company's third quarter 2000 earnings were $0.81 per share, 47 percent higher than similarly adjusted earnings of $0.55 per share reported a year ago.

PPL also announced its 2002 earnings forecast of between $3.55 and $3.65 per share, a range that reflects an approximate 11 percent increase over its 2001 forecast of $3.20 to $3.30 per share. William F. Hecht, PPL's chairman, president and chief executive officer, said these earnings forecasts are based on conservative assumptions about future business conditions. Hecht also confirmed the company's previously announced 2000 forecast of $3.00 per share, which also excludes the benefits of nonrecurring items.

Hecht said the record-setting earnings performance in recent quarters can be directly attributed to the company's success, over the last several years, in capitalizing on opportunities offered by the competitive energy marketplace.

"The most dramatic example of our success is in the electricity generation and marketing businesses," said Hecht. "Our company achieved excellent operating performance at our generation facilities throughout 2000, and we optimized the value of this performance through our wholesale trading and marketing activities in energy and related commodities. Through September 30, our trading and marketing organization is conservatively estimated to have added about $30 million of net income over and above the earnings from PPL's generating assets."

Also contributing to PPL's earnings growth during the third quarter and the first nine months of 2000 were positive results from the company's regulated energy delivery business in Pennsylvania and from the company's international operations.

Actual earnings for the third quarter of 2000 were $0.94 per share, including a nonrecurring benefit of 13 cents per share from a settlement with various insurers for environmental and other liabilities. Actual earnings for the third quarter of 1999 were $0.68 per share, including a nonrecurring benefit of 13 cents per share resulting from a series of transactions related to the securitization of PPL's transition costs.

Actual earnings per share for the first nine months of 2000 were $2.57, compared to actual earnings per share of $1.85 reported for the same period of last year. Excluding nonrecurring items during these periods, earnings per share of $2.41 for the first nine months of 2000 reflect an increase of 40 per cent over adjusted earnings per share of $1.72 for the same period of 1999.

Actual earnings per share for the 12 months ended September 30, 2000, were $3.59, compared to actual earnings per share of $2.41 reported in the same period last year. Excluding nonrecurring items during these periods, earnings per share of $3.04 for the 12 months ended Sept. 30, 2000, reflect an increase of 43 percent over adjusted earnings per share of $2.13 for the same period last year. This growth underscores the company's success from continuing operations.

"Our achievements of the past year and our expectation of sustained earnings improvement over the next two years are the result of a solid set of business fundamentals and a time-proven dedication on the part of our employees to continually improve our operations," said Hecht.

Hecht said PPL's corporate strategy of concentrating on the generation and sale of competitively priced energy in key U.S. markets while operating high-quality energy delivery businesses in selected regions around the world has led to record-breaking, sustainable growth.

  The major drivers of PPL's 2002 earnings forecast are:

  -- Increased margins on energy transactions;
  -- Increased supply of electricity to sell in the competitive wholesale
      markets in the West;
  -- New natural gas-powered plants in Arizona, Connecticut and
      Pennsylvania;
  -- Strong growth in the electricity delivery business in Pennsylvania;
  -- Higher earnings from the company's international businesses; and
  -- Success in continuing to reduce costs.

PPL invites interested parties to listen to the live Internet webcast of management's third quarter earnings teleconference with financial analysts at 9 a.m. today. The teleconference is available online live, in audio format, on PPL's main Internet web site, http://www.pplweb.com/ . Interested individuals also can access the live conference call via telephone at 913-981-4900.

Based in Allentown, Pa., PPL Corp. is a FORTUNE 500® company that delivers electricity and natural gas to more than 1.3 million customers in Pennsylvania; markets wholesale or retail energy in 42 U.S. states and Canada; provides energy services for businesses in the Mid-Atlantic and Northeastern U.S.; generates electricity at power plants in Pennsylvania, Maine and Montana; delivers electricity to 2.4 million customers in southwest Great Britain; and delivers electricity to nearly 1.8 million customers in Chile, Bolivia, El Salvador and Brazil.

                 PPL CORPORATION AND SUBSIDIARY COMPANIES
              CONSOLIDATED FINANCIAL INFORMATION (UNAUDITED)

                        Consolidated Balance Sheet
                          (Millions of Dollars)


                                Sept. 30,        Dec. 31,
                                     2000        1999 (a)
  Assets
  Current Assets                   $1,742          $1,293
  Investments                       1,021             695
  Property, plant and equipment
   Transmission and
    distribution - net              2,804           2,462
   Generation - net                 2,143           2,352
   General and intangible - net       265             259
   Construction work in progress      225             181
   Nuclear fuel and other
    leased property                   108             139
    Electric utility plant - net    5,545           5,393
   Gas and oil utility plant - net    171             171
   Other property - net                79              60
                                    5,795           5,624
  Recoverable transition costs      2,487           2,647
  Regulatory and other assets         927             915
  Total assets                    $11,972         $11,174

  Liabilities
  Current liabilities              $2,043          $2,280
  Long-term debt
   (less current portion)           4,564           3,689
  Deferred income taxes and ITC     1,474           1,548
  Liability for above market NUG
   purchases                          604             674
  Other noncurrent liabilities        966             959
  Minority interest                    75              64
  Company-obligated mandatorily
   redeemable securities              250             250
  Preferred stock                      97              97
  Earnings reinvested                 910             654
  Other common equity               1,825           1,795
  Treasury stock                     (836)           (836)
  Total liabilities               $11,972         $11,174

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


                      Consolidated Income Statement
                          (Millions of Dollars)

                          3 Months          9 Months           12 Months
                       Ended Sept. 30    Ended Sept. 30      Ended Sept. 30
                       2000     1999(a)  2000     1999(a)    2000   1999(a)

  Operating Revenues
   Electric           $729       $811  $2,201   $2,062    $2,897   $2,650
   Natural gas and
    propane             26         15     120       85       151      114
  Wholesale energy
   marketing and
   trading             616        495   1,559    1,127    $1,871   $1,363
  Energy-related
   businesses           87         65     288      183       382      232
                     1,458      1,386   4,168    3,457     5,301    4,359

  Operating Expenses
   Fuel and purchased
    power              690        701   1,891    1,567     2,355    1,899
   Other operation and
    maintenance        213        253     637      645       872      872
   Amortization of
    recoverable
    transition costs    50         27     159      113       218      113
   Depreciation and
    amortization        58         73     196      193       260      265
   Other               134         94     411      274       515      365
                     1,145      1,148   3,294    2,792     4,220    3,514
  Operating income     313        238     874      665     1,081      845
  Other income           1          0       8        7        98       47
  Income before interest,
   income taxes and
   minority interest   314        238     882      672     1,179      892
  Interest expense      94         80     274      203       348      269
  Income taxes          75        (22)    215       92       297      151
  Minority interest      3         13       4       13         5       13
  Income before
   extraordinary
   items               142        167     389      364       529      459
  Extraordinary items
   (net of taxes)        0        (59)      0      (59)       13      (59)
  Income before dividends
   on preferred stock  142        108     389      305       542      400
  Preferred stock
   dividend
   requirements          6          6      19       19        26       25
  Net Income          $136       $102    $370     $286      $516     $375

  Earnings per share of common stock -
   basic and diluted
    Adjusted
     earnings        $0.81      $0.55   $2.41    $1.72     $3.04    $2.13
    Nonrecurring
     items             .13        .13     .16      .13       .55      .24
    Other restructuring
     impacts           .00        .00     .00      .00       .00      .04
  Actual Earnings    $0.94      $0.68   $2.57    $1.85     $3.59    $2.41

  Average number of
   shares outstanding
   (thousands)     144,578    150,694 144,165  154,865   144,056  155,373

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

                                          Key Indicators
  Financial
                                12 Months Ended     12 Months Ended
                                 Sept. 30, 2000      Sept. 30, 1999

  Dividends declared per share          $1.045              $1.00
  Book value per share (a)             $13.12              $10.51
  Market price per share (a)           $41.7500            $27.0625
  Dividend yield                         2.5%                3.7%
  Dividend payout ratio (b)               34%                 47%
  Price/earnings ratio (b)              13.7                12.7
  Return on average common equity (b)26.50%              13.90%

  (a) End of period
  (b) Based on adjusted earnings


  Operating
  PPL Electric Utilities Corp./  3 Months Ended Sept. 30
  PPL EnergyPlus
                                                   Percent
                               2000         1999    Change

  (millions of kwh)
  Electricity delivered
   to retail customers (a)    8,321        8,221       1.2%
  Electricity supplied to
   retail customers (a)       9,340        8,480      10.1%

  PPL Electric Utilities Corp./
  PPL EnergyPlus
  Wholesale energy sales      6,998        7,801     -10.3%

  Operating
  PPL Electric Utilities Corp./  9 Months Ended Sept. 30
  PPL EnergyPlus
                                                   Percent
                               2000         1999    Change

  (millions of kwh)
  Electricity delivered
   to retail customers (a)   25,624       25,086       2.1%
  Electricity supplied to
   retail customers (a)      28,386       25,232      12.5%

  PPL Electric Utilities Corp./
  PPL EnergyPlus
  Wholesale energy sales     23,721       24,061      -1.4%

  Operating
  PPL Electric Utilities Corp./  12 Months Ended Sept. 30
  PPL EnergyPlus
                                                   Percent
                               2000         1999    Change

  (millions of kwh)
  Electricity delivered
   to retail customers (a)   33,582       33,029       1.7%
  Electricity supplied to
   retail customers (a)      36,848       33,037      11.5%

  PPL Electric Utilities Corp./
  PPL EnergyPlus
  Wholesale energy sales     31,375       31,466      -0.3%

  (a) Electricity delivered to retail customers represents the kwh delivered
       to customers within PPL Electric Utilities Corp.'s service territory.
       Electricity supplied represents the kwh supplied to customers within
       and outside PPL Electric Utilities Corp.'s service territory
      (including sales of PPL EnergyPlus).  Customers within PPL Electric
       Utilities Corp.'s service territory will have their energy delivered
       by PPL Electric Utilities Corp.

Certain statements contained in this news release, including statements with respect to future earnings, energy supply, sales, margins and deliveries, operating costs, subsidiary performance and generating capacity, are "forward-looking statements" within the meaning of the federal securities laws. Although PPL Corp. 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 Corp. 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; performance of new ventures; political, regulatory or economic conditions in countries where PPL Corp. or its subsidiaries conduct business; capital market conditions; foreign exchange rates; and the commitments and liabilities of PPL Corp. and its subsidiaries. Any such forward-looking statements should be considered in light of such factors and in conjunction with PPL Corp.'s Form 10-K and other reports on file with the Securities and Exchange Commission.

NewsCom: http://www.newscom.com/cgi-bin/prnh/19981015/PHTH025

PRN Photo Desk, 888-776-6555 or 201-369-3467

SOURCE: PPL Corporation

Contact: John R. Biggar, 610-774-5613, or Timothy J. Paukovits,
610-774-4124, both of PPL Corp., or fax, 610-774-5281

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