Slide 1: March 31, 2008 Exhibit 99.2
March 31, 2008 Exhibit 99.2
Slide 2: PPL Facts
PPL Facts PPL Corporation (NYSE: PPL) is a Fortune 500 company with headquarters in Allentown, Pa. The Company’s diversified corporate strategy is to achieve growth in energy supply margins while limiting volatility in both cash flows and earnings and to achieve stable, long-term growth in regulated
Slide 3: PPL Facts (cont.) Financial and Operating Information
PPL Facts (cont.) Financial and Operating Information (Unaudited) ($ in millions, except per share amounts) Year Ended December 2007 December 2006 Common Equity $5,556 $5,122 Preferred Equity 301 301 Short-Term Debt 92 42 Long-Term Debt 7,568 7,835 Total Capitalization $13,517 $13,300 Total Assets $
Slide 4: Cautionary Statements And Factors That May Affect Future Results
Cautionary Statements And Factors That May Affect Future Results Any statements made in this presentationabout future operating results or other futureevents are forward-looking statements underthe Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Actual results may dif
Slide 5: Growing Shareowner Value
Growing Shareowner Value • Continued focus on execution of our current growth plan • Extract additional value from our energy marketing operations • Multi-faceted expansion of the generation portfolio • Complete previously announced divestiture plans 2
Slide 6: Strong Long-Term Earnings Growth Forecast
$2.00 $2.50 $3.00 $3.50 $4.00 $4.50 $5.00 2007A* 2008 2010 Strong Long-Term Earnings Growth Forecast *Earnings from ongoing operations – See Appendix for the per share reconciliation of reported earnings and earnings from ongoing operations. $2.60 $2.35 $2.45 $4.00 $4.60 Per Share 3
Slide 7: Expected 2008 Earnings Contributions
Expected 2008 Earnings Contributions $2.00 $2.25 $2.50 $2.75 $2.60 Energy Margins $0.06 Net Impact of Asset Divestiture ($0.08) O&M $0.06 International Tax Benefit ($0.08) $2.40** Depreciation ($0.05) PA Delivery Margins $0.02 Synfuels ($0.14) Other $0.01 Per Share 2007A* 2008E **Midpoint of forecas
Slide 8: Expected 2010 Earnings Contributions
Expected 2010 Earnings Contributions Per Share Increased Energy Increased $5.00 $4.00 $3.00 $2.00 2008E 2010E $2.40* Margins O&M Increased $2.28 $(0.15) Interest Increased $(0.07) $(0.06) $4.30* $(0.10) Depreciation Other 5 *Midpoint of forecast
Slide 9: Cash Flow Forecast
Cash Flow Forecast Millions 2006A 2007A 2008E 2009E 2010E Free cash flow before dividends Note: See Appendix for the reconciliation of cash flow measures. ($200) $0 $200 $400 $600 $800 $1,000 6
Slide 10: Continued Dividend Growth
Continued Dividend Growth $/share Annualized $1.50 $1.34 $1.22 $1.25 $1.10 $1.00 $1.00 $0.92 $0.82 $0.75 $0.50 $0.25 $0.00 2004 April October 2006 2007 2008 2005 2005 7
Slide 11: PPL EU Completed Third RFP for 2010
PPL EU Completed Third RFP for 2010 • Solicitation for 850 MWs of residential and small commercial and industrial load • 50% of 2010 expected load now under contract • PUC approval of winning bids received March 27, 2008 • Based on completed solicitations, residential bills could increase by approxi
Slide 12: 2008 PJM Power & Natural Gas Prices
$/MMBtu 8.00 7.50 2008 PJM Power & Natural Gas Prices 74.00 76.00 9.50 10.00 62.00 68.00 70.00 72.00 7.00 8.50 9.00 West Hub ATC Power NYMEX Natural Gas 3/24 – Bids due for PPL EU 3rd RFP 66.00 64.00 25-Mar 22-Mar19-Mar16-Mar13-Mar10-Mar7-Mar4-Mar1-Mar27-Feb24-Feb21-Feb18-Feb15-Feb12-Feb9-Feb6-Feb3-
Slide 13: PPL Electric Utilities Phase-in Plan Proposal
PPL Electric Utilities Phase-in Plan Proposal 54-Month Phase-In Plan Average Residential Customer - 1,000 kWh per month $1,000.00 $1,100.00 $1,200.00 $1,300.00 $1,400.00 $1,500.00 $1,600.00 $1,700.00 $1,800.00 1/1/2008 7/1/2008 2009 2010 2011 2012 Annualized Electric Cost~6% ~7% ~7% ~6% ~6% 10ALJ re
Slide 14: Scrubbers Expected to be Completed on Budget and on Schedule
Scrubbers Expected to be Completed on Budget and on Schedule Q2-09Brunner Island 1 & 2 Q4-08Brunner Island 3 Q2-08Montour 1 In Service 3/8/2008 Montour 2 Scheduled In-Service Dates December, 2006 March, 2008 Montour Scrubber Construction 11
Slide 15: Expansion of Generation Portfolio
Expansion of Generation Portfolio • Generation uprates continue to progress • Selected UniStar Nuclear Energy to prepare COLA application based on AREVA reactor design • Asset expansion plan 12
Slide 16: Nuclear Development Timeline
Nuclear Development Timeline Submit COLA Submit DOE Loan Application Early Site Work Order Long Lead-Time Materials NRC Approval of COLA Begin Construction Commercial Operation Sept. 2008 Sept. 2008 2009 Late 2008 (Estimate) 2011 (Estimate) 2011 (Estimate) 2016 to 2018 (Estimate) 13 PPL has not yet
Slide 17: Expected 2008 to 2010 Margin Walk
Expected 2008 to 2010 Margin Walk 1700 2100 2500 2900 3300 3700 2008E 2010E *Includes power prices and spark spread changes as well as value from portfolio management. 14 $/Million Higher Higher Higher Nuclear Fuel Increased Capacity Generation Costs Environmental Value $61 ($80) Costs $540 ($49) $3
Slide 18: Key Driver of Fleet Value: Open EBITDA
Key Driver of Fleet Value: Open EBITDA 2010E Generation Output - -millions of MWh 56.2 Unhedged Gross Margin -millions * 3,712 $ O&M -millions (814) $ Open EBITDA -millions 2,898$ Below-Market value of Hedges -millions * (254) $ * Based on forward market prices as of December 31, 2007 15
Slide 19: 2010 Margin Sensitivities
2010 Margin Sensitivities • PJM electricity price change of $1/MWh = ±$19M (Based on average ATC price of $64/MWh) • PJM capacity price change of $1/MWD = ±$1.7M (Based on PJM capacity price of $191/MWD) • Baseload generation availability change of 1% = ±$20M (Based on an EQA of 91%) 16
Slide 20: ppl
ppl
Slide 21: Market Prices
Market Prices EAST PJM On-Peak Off-Peak ATC (3) WEST Mid-Columbia On-Peak Off-Peak ATC (3) GAS (4) NYMEX TZ6NNY PJM MARKET HEAT RATE (5) Actual Forward (1) At 10/2007(2) 2007 2008 2009 2010 2010 9.4 $7.78 $6.86 $51 $45 $57 $57 $43 $73 8.8 $9.04 $8.08 $60 $53 $67 $64 $51 $79 8.98.88.9 $9.56$9.52$8.82
Slide 22: Hedge Positions - Electricity and Fuel
Hedge Positions* -Electricity and Fuel 2008 2009 2010 Electricity Sales East 96% 94% 61% West 100% 80% 64% Total 96% 92% 62% Coal East 94% 76% 70% West 100% 100% 100% Total 95% 82% 78% A-2*At 12/31/2007
Slide 23: PPL Supply Business Overview
PPL Supply Business Overview 2008E Production GWh Gas/Oil 33% Coal 37% Nuclear 19% Hydro8% QFs 3% 2008E Installed Capacity MW Gas/ Oil 8% Coal 54% Nuclear 31% Hydro 7% A-3
Slide 24: Proactive Coal Supply Management Supports Growth in Margins
Proactive Coal Supply Management Supports Growth in Margins Projected 2008 Coal Supply • Supply region diversity • Fleet trains (1600 cars) • Average delivered costs – 4% to 5% annual increase from 2007 to 2010 Central PA 20% PRB 6% Montana Mine-mouth 20% Central Appalachia 13% Southwest PA 41% A-4
Slide 25: Key Drivers/Challenges Through 2010 and Beyond
Key Drivers/Challenges Through 2010 and Beyond • Increased prices for POLR sales • Expiration of supply contracts remarketed at currentforward prices • Power plant uprates and planned levels of equivalent availability of generation • Net economic benefits from the installation of scrubbers at the Mo
Slide 26: Expected Changes in Margins - 2007 to 2008
Expected Changes in Margins -2007 to 2008 *Includes power price and spark spread changes as well as value from portfolio management. 1700 1800 1900 2000 2007A 2008E $/Million $1,824 $1,866 Improved Power Value* $95 Higher Nuclear Generation $26 Higher Coal Generation $18 Higher Hydro Generation $9 H
Slide 27: Retail price components example
0 20 40 60 80 100 120 2009 2009 2010 $/MWh Shaped Energy & Capacity Including Congestion Other Adders Line Losses GRT Load-following Components Example Total $105 $82.00* $45.47 Total $51.23 * Shaped price based on $63/MWh ATC energy price, $150/MW-Day capacity price, and congestion. $48.29 Total $5
Slide 28: Shrinking Reserve Margins Create Potential Value for PPL
Shrinking Reserve Margins Create Potential Value for PPL 5% 10% 15% 20% 2007 2008 2009 2010 PJM Mid-Atlantic Expected Reserve Margin PJM Required 15% Reserve Margin A-8
Slide 29: PPL's Generation Portfolio
PPL’s Generation Portfolio Total Domestic Generation: 11,418 MW Planned Uprate Projects: 331 MW * Reflects reduction of 60 MW expected loss due to increased plant usage during scrubber operation. Coal 3,483* Nuclear 2,117 Oil 1,716 Gas 1,582 Hydro 343 CTs 474 QFs 356 East 10,071 MW* Coal 683 Hydro 6
Slide 30: Summary of Completed RFPs
Summary of Completed RFPs Small Commercial and Residential Customers Industrial Customers $106.54 23.8% to 42.8% $105.22 34.4% Average Retail Price Per MwH Increase in 2010 $108.76$108.80 Round 3 (March 2008) Retail Price Per MwH $105.75$105.08 Round 2 (October 2007) Retail Price Per MwH $105.11$101
Slide 31: Reconciliation of Cash from Operations to Free Cash Flow before Dividends
Reconciliation of Cash from Operations to Free Cash Flow before Dividends (Millions of Dollars) $994$154($100)$513$167Free Cash Flow before Dividends (15)101493785Other Investing Activities-net (1,490)(1,456)(1,609)(1,685)(1,394)Capital Expenditures --(310)(310)(282)Transition Bond Repayment Increas
Slide 32: Capital Expenditures by Segment
Millions $1,043 $1,030 $824 $750 $692 $514 $302 $281 $305 $404 $521 $511 $340 $298 $327 $336 $343 $351 $0 $400 $800 $1,200 $1,600 $2,000 2007A 2008E 2009E 2010E 2011E 2012E Supply PA Delivery International Delivery $1,685 $1,556 $1,376 $1,490$1,456 $1,609 Capital Expenditures by Segment A-12
Slide 33: Reconciliation of Fourth Quarter Reported Earnings and Earnings from Ongoing Operations
Reconciliation of Fourth Quarter Reported Earnings and Earnings from Ongoing Operations (Millions of Dollars) Pennsylvania International Supply Delivery Delivery Total Qtr. Ending December 31, 2007 Reported earnings $114 $13 $291 $418 Special Items: MTM adj's from energy-related, nontrading economic
Slide 34: Reconciliation of Fourth Quarter Reported Earnings and Earnings from Ongoing Operations
Reconciliation of Fourth Quarter Reported Earnings and Earnings from Ongoing Operations Pennsylvania International Supply Delivery Delivery Total Qtr. Ending December 31, 2007 Reported earnings $0.31 $0.03 $0.77 $1.11 Special Items: MTM adj's from energy-related, nontrading economic hedges 0.03 0.03
Slide 35: Reconciliation of Year-to-Date Reported Earnings and Earnings from Ongoing Operations
Reconciliation of Year-to-Date Reported Earnings and Earnings from Ongoing Operations (Millions of Dollars) Pennsylvania International Supply Delivery Delivery Total Year-to-Date December 31, 2007 Reported earnings $568 $110 $610 $1,288 Special Items: MTM adj's from energy-related, nontrading econom
Slide 36: Reconciliation of Year-to-Date Reported Earnings and Earnings from Ongoing Operations
Reconciliation of Year-to-Date Reported Earnings and Earnings from Ongoing Operations Pennsylvania International Supply Delivery Delivery Total Year-to-Date December 31, 2007 Reported earnings $1.48 $0.29 $1.58 $3.35 Special Items: MTM adj's from energy-related, nontrading economic hedges 0.08 0.08
Slide 37: Reconciliation of PPL's Reported Earnings and Earnings from Ongoing Operations
Reconciliation of PPL’s Reported Earnings and Earnings from Ongoing Operations Actual High Low 2008 2008 2007 2006 2005 Per Share Earnings from Ongoing Operations $2.45 $2.35 $2.60 $2.25 $2.08 Special items (net of taxes): economic hedges 0.08 (0.03) Write-off of Hurricane Isabel regulatory assets (
Slide 38: Credit Ratings
Credit Ratings BBBIssuer Rating AAAAaaTax-Exempt Bonds* STABLE STABLE STABLE Outlook AAA3Senior Secured Debt F-2A-2P-2Commercial Paper BBBBBBBaa3Preferred Stock BBBABaa1Issuer Rating AAA3First Mortgage Bonds AAAAaaTax-Exempt Bonds** BBBBBBBaa3Preference Stock PPL Electric Utilities BBBBBBBaa2Senior
Slide 39: Credit Ratings (cont.)
Credit Ratings (cont.) A-3Commercial Paper ABBB+ Baa1Senior Unsecured Debt F2A-2P-2Commercial Paper STABLE STABLE STABLE Outlook BBB+ BBB+ Baa1Issuer Rating ABBB+ Baa1Senior Unsecured Debt F2A-2Commercial Paper STABLE STABLE STABLE Outlook Western Power Distribution (South West) PLC BBB+ BBB+ Issuer
Slide 40: Forward-Looking Information Statement
Forward-Looking Information Statement Statements contained in this news release, including statements with respect to future earnings, energy prices, margins, sales and supply, marketing performance, growth, revenues, expenses, rates, regulation, cash flows, credit profile, financing, dividends, bus
Slide 41: Definitions of Financial Measures
Definitions of Financial Measures “Earnings from ongoing operations” excludes the impact of special items. Special items include charges, credits or gains that are unusual or non-recurring and the mark-to-market impact of energy-related, non-trading economic hedges. The mark-to-market impact of thes