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URL:  https://boards.fool.com/earnings-blowout-14835760.aspx

Subject:  Earnings Blowout Date:  4/24/2001  5:04 PM
Author:  minesweep Number:  35 of 117

PPL's Earnings Leap by 54 Percent for First Quarter; Company Forecasts Increased Earnings for 2001, 2002, Through Mid-Decade

ALLENTOWN, Pa., April 24 /PRNewswire Interactive News Release/ -- For the sixth straight quarter, PPL Corporation (NYSE: PPL) has achieved record earnings. First-quarter earnings, announced Tuesday (4/24), were $1.52 per diluted share, a 54 percent increase over the same period a year ago and 36 percent higher than the Wall Street consensus estimate.
(Photo: http://www.newscom.com/cgi-bin/prnh/19981015/PHTH025 )
PPL also has significantly increased its earnings forecasts for 2001 and 2002, based on the following factors:
· The first securitization of a U.S. electricity delivery company, which is a unique strategic initiative that more than doubles the company's generating capacity available for sale in wholesale electricity markets, while lowering its cost of capital (see accompanying news release for more details of this plan).
· The record earnings performance in the first quarter of 2001.
· Increased margins on energy transactions.
· Increased supply of electricity to sell in the competitive wholesale markets, including a new natural gas-powered plant in Illinois.
· Strong growth in the electricity delivery business in Pennsylvania.
· Higher earnings from the company's international businesses.
· Success in continuing to reduce costs.
Using conservative assumptions about future business conditions, PPL now forecasts earnings in excess of $4.00 per share for 2001 and $4.55 to $4.65 per share for 2002. Earnings per share of $4.00 in 2001 would represent an increase of about 22 percent over 2000's adjusted, diluted earnings of $3.28 per share. Earnings per share of $4.55 to $4.65 in 2002 would represent an increase of about 15 percent over earnings now forecast for 2001.
"We are confident that our strong asset base, combined with our proven operating, marketing and development capabilities, will lead to additional growth in earnings through the middle of this decade," said William F. Hecht, PPL's chairman, president and chief executive officer. "For that period, we expect a compound annual earnings per share growth rate of 12 to 15 percent, based on our 2000 adjusted earnings."
The major drivers of PPL's earnings growth for the first quarter were: increased margins on wholesale energy transactions; positive results from the company's regulated energy delivery business in Pennsylvania and from the company's international operations; and success in continuing to control costs.
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.
Adjusted earnings per diluted share for the 12 months ended March 31, 2001, were $3.81, compared to $2.54 reported in the same period last year.
Actual earnings per diluted share for the 12 months ended March 31, 2001, were $3.97, including a nonrecurring benefit of 16 cents per share from a settlement with various insurers for environmental and other liabilities. Actual earnings per diluted share for the same period of 2000 were $3.04, reflecting one-time gains from the sale of a generation plant in Sunbury, Pa., a gain from the sale of the supply portion of the company's electricity business in the United Kingdom, and a net gain from the sale of transition bonds in the securitization process. Partially offsetting these benefits during the period a year ago was a one-time adjustment to write down the carrying value of certain investments made by PPL Global, the company's international energy development subsidiary.
PPL now operates nearly 10,000 megawatts of generation capacity in Pennsylvania, Maine and Montana. PPL has more than 4,600 megawatts under development including:
· A 225-megawatt plant in Wallingford, Conn., expected to be in service by mid-2001.
· A 600-megawatt plant near Kingman, Ariz., expected to be in service by mid-2001 (PPL owns 50 percent of this facility).
· A 450-megawatt plant near Phoenix, Ariz., expected to be in service in summer 2002.
· A 540-megawatt plant near Chicago, Ill., expected to be in service in summer 2002.
· A 600-megawatt plant in Lower Mount Bethel, Pa., expected to be in service in 2003.
· More than 900 megawatts of capacity at five small plant sites in eastern Pennsylvania, expected to be in service by 2003.
· About 300 megawatts of capacity located on Long Island near Smithtown, N.Y., expected to be in service in summer 2003.
· An extra 100 megawatts of capacity at PPL's existing Susquehanna nuclear plant, near Berwick, Pa., through turbine upgrades in the spring of 2003 and 2004.
· A 1,200-megawatt plant located near Starbuck, Wash., expected to come online in late 2004 or early 2005.


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