Slide 1: Completing the Transformation
Exhibit 99.2 Completing the Transformation PPL Energy Supply to Combine with Riverstone’s Generation Business to Form Talen Energy Corporation June 10, 2014 © PPL Corporation 2014
Slide 2: Cautionary Statements and Factors That May Affect Future Results
Cautionary Statements and Factors That May Affect Future Results Forward Looking Statements Any statements made in this presentation about future operating results or other future events are forward-looking statements under the Safe Harbor Provisions of the Private Securities Litigation Reform Act o
Slide 3: Agenda
Agenda Transaction Overview Bill Spence Chairman, President & CEO, PPL Corporation Talen Energy Overview Paul Farr President, PPL Energy Supply, LLC President & CEO, Talen Energy, at Close Transaction Structure, Process Jeremy McGuire and Timing Vice President - Strategic Development, PPL Strategic
Slide 4: Transaction Overview
Transaction Overview • PPL Energy Supply, LLC (“PPL Energy Supply”) will be spun off from PPL Corporation (“PPL”) and combined with Riverstone’s power generation business (“RJS Power Holdings LLC”) to form Talen Energy Corporation (“Talen aEnergy”) • Creates highly competitive 15 GW IPP with attract
Slide 5: Transaction Benefits
Transaction Benefits • 15 GW of capacity focused primarily in PJM and ERCOT, two highly attractive markets Creates a • Highly diversified fleet; environmentally well positioned Highly • Robust cash flow generation capability Attractive IPP • Conservative capitalization positions company well for fut
Slide 6: Talen Energy Overview
Talen Energy Overview © PPL Corporation 2014 5
Slide 7: Talen Energy Market Presence
Talen Energy Market Presence Presence in Most Attractive and Liquid U.S. Power Markets PPL Energy Supply WECC (1) MT VT NH 93% NY MA CT RI PJM PA RJS Power Holdings MD DE LLC (1) ERCOT ISO-NE 35% 63% PJM TX Talen Energy (1),(2) Ownership WECC ISO-NE PPL Energy Supply RJS Power Holdings LLC 1% ERCOT
Slide 8: Talen Energy Asset Profile
Talen Energy Asset Profile Compelling IPP with Significant Scale and Diversity Generating Capacity: (2) (2) Operating Facilities: States: (2) + = (2) Renewables Oil Oil Renewables Nuclear Nuclear Fuel Mix: Coal Coal Coal Natural Gas Natural Gas Natural Gas Well positioned to grow in key markets (1)
Slide 9: Talen Energy Peer Positioning
Talen Energy Peer Positioning • Sufficient scale to be efficient • Strong EBITDA production per MW of capacity #3 IPP and #5 Competitive Generator in the U.S. (1) (2) (1) Does not account for any market mitigation that will be required to achieve regulatory approvals. (2) Excludes 11 Montana hydro a
Slide 10: Talen Energy Hedging Profile
Talen Energy Hedging Profile (As of May 31, 2014) 2014 2015 2016 PPL Energy RJS Power PPL Energy RJS Power PPL Energy RJS Power Baseload Supply Holdings LLC Supply Holdings LLC Supply Holdings LLC Expected Generation (1) (Millions MWhs) 50.2 9.1 45.1 8.3 44.0 7.9 East 43.2 9.1 40.8 8.3 40.0 7.9 West
Slide 11: Enhanced Value from Significant Synergy Potential
Enhanced Value from Significant Synergy Potential ($mm) Services / HQ Operating Total (1) Pre-Synergies 2015E O&M (3) PPL Energy Supply $192 (2) $712 (3) $904 RJS Power Holdings LLC 13 217 230 $205 $929 $1,134 Subtotal Full Year Run-Rate Synergies O&M $85 $60 $145 Margin from improved 0 10 10 Commer
Slide 12: Talen Energy Financial Highlights
Talen Energy Financial Highlights ($mm) PPL Energy Supply RJS Power Holdings Total LLC (1) 2015E Adjusted EBITDA $627 $285 $912 Run-Rate Annual Synergies 155 “Model Year” Adjusted 1,067 EBITDA (2) 2015E CapEx 369 54 423 (3) (4) Debt 2,713 1,250 3,963 (5) (6) Cash 520 NA 520 • Anticipate a BB area cr
Slide 13: Talen Energy Strategy: Delivering Future Value
Talen Energy Strategy: Delivering Future Value Safety and Plant • Value is built on a foundation of excellence in operations Performance • Safety is a core value • Investment to maintain safe operations Disciplined Capital • Investment to sustain current fleet made on an economic basis Investment •
Slide 14: Transaction Structure, Process and Timing
Transaction Structure, Process and Timing © PPL Corporation 2014 13
Slide 15: Key Transaction Terms
Key Transaction Terms Topic Commentary • PPL Energy Supply will be distributed to PPL shareholders to form Talen Energy through a Structure and tax-free spin off; Riverstone will then contemporaneously contribute RJS Power Holdings Consideration LLC to Talen Energy in exchange for Talen common stock
Slide 16: Simplified Corporate Structure
Simplified Corporate Structure Transaction Summary Pro Forma Corporate Structure • PPL shareholders continue to own 100% of PPL Corporation PPL Shareholders Riverstone Holdings • 100% of PPL Energy Supply will be spun off to PPL shareholders to form Talen 100% 65% 35% Energy • Riverstone will contem
Slide 17: Talen Energy Capitalization and Liquidity
Talen Energy Capitalization and Liquidity Overview Expected Talen Capitalization and Liquidity ($mm) • Targeting $1,850 million of liquidity facilities active upon close, committed by New Talen Revolving Credit Facility $1,850 end of July • Existing PPL Energy Supply term debt to Short Term Debt (1)
Slide 18: Transaction Timeline
Transaction Timeline Principal Required Approvals Required Approval Expected Timing Federal Energy Regulatory Commission (FERC) 3-6 months Hart-Scott-Rodino - Federal Trade Commission (FTC) 4-8 months and Department of Justice (DOJ) Nuclear Regulatory Commission (NRC) 7-9 months Pennsylvania Public
Slide 19: PPL Corporation Update
PPL Corporation Update © PPL Corporation 2014 18
Slide 20: Commitment to Creating Shareholder Value
Commitment to Creating Shareholder Value Evolution of PPL 2008 2009 2010 2011 2012 2013 2014 Future 2010 (1) 2012 (2) 2013 (3) Pro-Forma PPL Corporation Market Cap ($bn) $12.8 $16.4 $18.8 Enterprise Value ($bn) $17.2 $35.1 $37.8 FY+1 P/E 10.6x 13.0x 13.7x Business Profile (4) % Utility 16% 27% 28% %
Slide 21: PPL Corporation Investment Highlights
PPL Corporation Investment Highlights • 100% rate-regulated business model provides earnings and dividend growth potential – Substantial projected growth in rate base: ~7% CAGR from 2014-2018 – Target EPS compound annual growth rate of at least 4%, excluding PPL Energy Supply(1) – Maintain current d
Slide 22: Managing Corporate Costs
Managing Corporate Costs Total Supply Cost Allocations ~ $215 million (1) $75mm $110mm Remaining cost allocation $30mm limited to systems and A portion of these hardware supporting utility costs will be reduced businesses through Talen synergy plan (1) Excludes approximately $50mm of interest expens
Slide 23: 2014 and 2015 Earnings Forecast
2014 and 2015 Earnings Forecast Hypothetical $2.30 $2.25 $2.10 $2.15 $2.00 $2.05 (1) 2014E Ongoing 2014E Ongoing 2015E Segment Midpoint Midpoint(2) Midpoint (ex-Supply) (2) U.K. Regulated $1.34 $1.34 $1.36 Kentucky Regulated 0.45 0.45 0.48 PA Regulated 0.39 0.39 0.39 (1) Supply 0.11 -- -- Corporate
Slide 24: Closing Remarks and Q&A
Closing Remarks and Q&A © PPL Corporation 2014 23
Slide 25: Transaction Benefits
Transaction Benefits • 15 GW of capacity focused primarily in PJM and ERCOT, two highly attractive markets Creates a • Highly diversified fleet; environmentally well positioned Highly • Robust cash flow generation capability Attractive IPP • Conservative capitalization positions company well for fut
Slide 26: Appendix
Appendix © PPL Corporation 2014 25
Slide 27: Talen Energy Asset Overview
Talen Energy Asset Overview PPL Energy Supply Assets (1),(2) (1) Excludes 11 Montana hydro assets to be sold under a September 26, 2013 Purchase and Sale Agreement with NorthWestern Corporation. (2) Does not account for any market mitigation that will be required to achieve regulatory approvals. (3)
Slide 28: Jade Portfolio
Jade Portfolio (1) Does not account for any market mitigation that will be required to achieve regulatory approvals. © PPL Corporation 2014 27 Asset Location Fuel Type Ownership Owned Capacity (MW) COD Region Brandon Shores MD Coal 100% 1,273 1984 - 1991 PJM Raven H. A. Wagner MD Coal / Natural Gas
Slide 29: Talen Energy Environmental Controls
Talen Energy Environmental Controls 1. Recently finalized 316(b) regulations will require intake structure modifications for sites with once- through cooling towers. Pending ELG revisions could require additional controls on other waste water streams. 2. The Regional Haze FIP for Montana would requi
Slide 30: Talen Projected Capital Expenditure Detail
Talen Projected Capital Expenditure Detail Projected Major Environmental Spend Brunner Brandon H.A. ($mm) Montour Colstrip Keystone Conemaugh Corette C.P. Crane Total Island Shores Wagner Regional Haze -- -- $11.4 -- -- -- -- -- -- $11.4 (1) MD HAA (2) -- -- -- -- -- -- -- -- -- -- MATS (3) $22.8 --
Slide 31: PPL Corporate Structure Post Spin
PPL Corporate Structure Post Spin PPL Corporation PPL Capital Funding Credit Rating S&P Moody’s Credit Rating S&P Moody’s Secured NR NR Secured NR NR Unsecured NR NR Unsecured BBB- Baa3 Long-Term Issuer BBB Baa3 Long-Term Issuer NR Baa3 Outlook Stable Stable Outlook Stable Stable PPL Global LKE PPL
Slide 32: PPL Overview
PPL Overview PPL Electric Utilities • Customers: 1.4 million Electric • Allowed Distribution ROE: 10.40% • Rate Base: $4.2 billion (1) • 5-Year Transmission Rate Base CAGR: 13.4% • 5-Year Distribution Rate Base CAGR: 6.2% • Regulatory Entity: Pennsylvania PUC U.K. Delivery • Customers: 7.8 million E
Slide 33: U.K. Regulated Segment Overview
U.K. Regulated Segment Overview Investment Highlights Capital Expenditure Plan (1) • Highly attractive rate‐regulated business – Regulator‐approved multi‐year forward‐looking revenues based on future business plan, including capital expenditures and O&M plus adjustments for inflation – Real‐time ret
Slide 34: Kentucky Regulated Segment Overview
Kentucky Regulated Segment Overview Investment Highlights Capital Expenditure Plan • Efficient, well‐run utilities focused on safety, reliability and customer ($bn) service • Constructive regulatory environment that provides a timely return on a substantial amount of planned CapEx over the next 5 ye
Slide 35: Pennsylvania Regulated Segment Overview
Pennsylvania Regulated Segment Overview Investment Highlights Capital Expenditure Plan • Significant growth in transmission portion of business which earns a favorable rate of return on a near real‐time basis – CAGR of 13.4% in transmission rate base through 2018 driven by initiatives to improve agi
Slide 36: Reg G Reconciliation - Talen Energy
Reg G Reconciliation - Talen Energy 2015E Adjusted EBITDA ($mm) PPL Energy Supply RJS Power Holdings LLC Net Income/(Loss) $ 46 $ 75 Income Taxes (1) 31 50 Interest Expense 177 67 Depreciation & Amortization 493 93 EBITDA 747 285 Add: Non-Cash Compensation 27 -- Less: Nuclear Fuel Amortization 147 -
Slide 37: Reg G Reconciliation - PPL Corp
Reg G Reconciliation - PPL Corp (After-Tax) (Unaudited) U.K. Kentucky Pennsylvania Corporate High Low Earnings from Ongoing Operations $ 1.34 $ 0.45 $ 0.39 $ 0.11 $ (0.06) $ 2.23 $ 2.30 $ 2.15 Special Items: Adjusted energy-related economic activity, net (0.20) (0.20) (0.20) (0.20) Foreign currency-
Slide 38: Other Non-GAAP Financial Measures
Other Non-GAAP Financial Measures "Earnings from ongoing operations," also referred to as "ongoing earnings," should not be considered as an alternative to reported earnings, or net income attributable to PPL shareowners, which is an indicator of operating performance determined in accordance with U
Slide 39: Cautionary Statements and Factors That May Affect Future Results
Cautionary Statements and Factors That May Affect Future Results Statements contained in this presentation, including statements with respect to future earnings, cash flows, financing, regulation, operating performance and corporate strategy, are “forward-looking statements” within the meaning of th