01—Abstract
Summary
Summary of the 10-Q filed November 1, 2024. Cited figures are marked; the original filing is the authoritative source.
PPL Corporation's third-quarter 2024 Form 10-Q, covering the three and nine months ended September 30, 2024, shows net income of $214 milliona for the quarter, down from $230 million a year earlier, and $711 million for the nine months, up from $627 million.
Basic and diluted EPS were $0.29b for the quarter versus $0.31, and $0.96 for the nine months versus $0.85. Operating revenues were $2.07 billion for the quarter and $6.25 billion for the nine months, roughly flat year over year. Earnings from Ongoing Operations, a non-GAAP measure, were $310 million for the quarter versus $317 million and $994 million for the nine months versus $884 million.
The nine-month improvement in reported net income reflects higher operating income, which rose to $1.36 billionc from $1.24 billion, driven by a sharp decline in energy purchases, partly offset by higher other operation and maintenance expense and higher interest expense of $549 million versus $494 million. Segment results show Kentucky Regulated net income of $493 million and Pennsylvania Regulated of $441 million for the nine months, with Rhode Island Regulated improving to $90 million. Corporate and Other losses widened to $313 million from $259 million, largely due to acquisition integration costs tied to Rhode Island Energy.
Capital spending and financing dominated cash flows. Expenditures for property, plant and equipment were $1.95 billiond for the nine months, against $1.74 billion a year earlier. Operating cash flow was $1.83 billion.
PPL issued $1.89 billion of long-term debt and declared a quarterly dividend of 25.75 cents per share. Total long-term debt rose to $16.50 billion from $14.61 billion at December 31, 2023. The filing notes that the Mill Creek Unit 5 natural gas combined cycle plant, estimated at about $1.0 billion including AFUDC, is expected to begin commercial operation in mid-2027.
02—Key points
Key Highlights
- Net income for the three months ended September 30, 2024 was $214 million, versus $230 million in the prior-year period; nine-month net income rose to $711 million from $627 million.
- Diluted EPS was $0.29 for the quarter (versus $0.31) and $0.96 for the nine months (versus $0.85).
- Earnings from Ongoing Operations, a non-GAAP measure, were $994 million for the nine months versus $884 million, and $310 million for the quarter versus $317 million.
- Nine-month energy purchases fell to $1.13 billion from $1.43 billion, mainly due to lower PLR prices of $222 million at PPL Electric.
- Nine-month capital expenditures for property, plant and equipment were $1.95 billion, up from $1.74 billion, with the increase concentrated in transmission and distribution projects and Mill Creek Unit 5.
- Total long-term debt increased to $16.50 billion at September 30, 2024 from $14.61 billion at December 31, 2023, including new issues from RIE, PPL Capital Funding and PPL Electric.
- LG&E and KU filed with the KPSC on October 4, 2024 to recover about $125 million under the Retired Asset Recovery rider for the expected 2024 retirement of Mill Creek Unit 1.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ3 FY2024filed November 1, 2024Financial Statements
Q3 FY2024 against Q3 FY2023
| Line item | Q3 FY2024Q3 FY2023 | Change |
|---|---|---|
| Revenue | $2.08B$2.04B | +1.9% |
| Operating Income | $428.00M$437.00M | −2.1% |
| Interest Expense | $188.00M$165.00M | +13.9% |
| Net Income | $214.00M$230.00M | −7.0% |
| EPS (Basic) | $0.29$0.31 | −6.5% |
| EPS (Diluted) | $0.29$0.31 | −6.5% |
| Shares Outstanding (Basic) | 737.77M737.11M | +0.1% |
| Shares Outstanding (Diluted) | 739.97M738.18M | +0.2% |
05—Questions
Frequently Asked Questions
How did PPL's earnings perform in the third quarter of 2024?
Net income was $214 million, down from $230 million in the third quarter of 2023, and basic and diluted EPS was $0.29 versus $0.31. Operating revenues rose slightly to $2.07 billion from $2.04 billion. Interest expense increased to $188 million from $165 million.
What drove the year-to-date increase in net income?
For the nine months, net income rose to $711 million from $627 million. Operating income increased to $1.36 billion from $1.24 billion, helped by a $297 million decline in energy purchases, which was partly offset by higher other operation and maintenance expense of $1.93 billion versus $1.81 billion.
How is PPL funding its capital program?
PPL issued $1.89 billion of long-term debt in the first nine months of 2024, including $500 million of RIE senior notes, $750 million of PPL Capital Funding senior notes and $650 million of PPL Electric first mortgage bonds. Short-term debt was reduced by $992 million to zero by September 30, 2024. Operating cash flow of $1.83 billion also helped fund $1.95 billion of capital expenditures.
What major projects and regulatory matters should investors watch?
The Mill Creek Unit 5 natural gas combined cycle plant, estimated at about $1.0 billion including AFUDC, is expected to begin commercial operation in mid-2027. LG&E's application to recover about $125 million for the retirement of Mill Creek Unit 1 is pending, with a KPSC ruling expected by February 28, 2025. PPL Electric also has a pending petition to raise its DSIC cap to 9%, with a final order targeted for January 23, 2025.
Are there any notable legal or regulatory contingencies?
The Rhode Island Energy energy efficiency investigation remains open, with the Division of Public Utilities and Carriers proposing $11 million as the amount to be refunded to the energy efficiency program. RIE does not expect this matter to have a material adverse effect on its results. A FERC transmission credit matter is also pending at the D.C. Circuit, and LG&E and KU do not expect a material effect from it.
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