By John Kell
PPL Corp.'s (PPL) second-quarter earnings rose 49% as the public
utility's bottom line was bolstered by hedging-related gains, and
as profitability grew for each of the company's regulated utility
segments.
The company also raised its full-year profit outlook, now seeing
$2.25 to $2.40 a share in ongoing earnings, up from the May view of
$2.15 to $2.40.
PPL has been aiming to increase its presence in regulated-power
markets as wholesale generators across the industry have been hurt
by stubbornly low natural-gas prices. The company more than doubled
the number of PPL's regulated utility customers through the 2011
acquisition of two Kentucky utilities and an electric-distribution
business in the U.K. Midlands.
PPL reported a profit of $405 million, or 63 cents a share, up
from $271 million, or 46 cents a share, a year earlier. Excluding
some energy-related economic activity and other items, earnings
from ongoing operations fell to 49 cents from 51 cents.
Revenue grew 35% to $3.45 billion, as the latest quarter
included a $590 million gain from energy-related contracts that
hedge future cash flows. The prior-year period had a loss of $458
million for that same metric.
Analysts surveyed by Thomson Reuters expected a profit of 46
cents a share on revenue of $2.63 billion.
Earnings from ongoing operations in the supply
segment--primarily the competitive electricity generation and
energy-marketing operations of PPL Energy Supply--decreased by
seven cents a share to a penny a share, hurt by lower energy
prices.
Ongoing operations from the company's U.K. regulated operations
grew by to 35 cents from 31 cents, primarily due to higher
electricity prices and volume due to the weather.
The Kentucky regulated segment's earnings climbed to eight cents
a share from seven cents as higher electricity and gas rates were
somewhat offset by lower volume.
Shares closed Wednesday at $31.77 and were inactive in premarket
trading. The stock has gained 11% in 2013, slightly underperforming
the broader market.
Write to John Kell at john.kell@wsj.com
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