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PPL Corp (PPL) Beats on Q3 Earnings, Misses on Revenues
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PPL Corporation (PPL - Free Report) reported third-quarter 2016 adjusted earnings of 63 cents per share, topping the Zacks Consensus Estimate of 59 cents by 6.8%. Reported earnings also increased 23.5% on a year-over-year basis.
On a GAAP basis, the company posted earnings per share of 69 cents in the quarter, compared with 58 cents a year ago. The difference between GAAP and operating earnings in the reported quarter was due to 29 cents of foreign currency-related economic hedges, charges of 30 cents related to the settlement of foreign currency contracts,and 5 cents related to a change in the UK tax rate.
Total Revenue
PPL Corp.’s total revenue of $1,889 million missed the Zacks Consensus Estimate of $2,000 million but were up marginally from the year-ago tally of $1,878 million.
Segment Results
UK Regulated: Adjusted earnings of 35 cents per share surged 20.7% from the prior-year figure of 29 cents. This was primarily backed by the Apr 1, 2016 price increase, and lower operation and maintenance expenses, partially offset by lower sales volumes.
Kentucky Regulated: Adjusted earnings increased by 2 cents to 18 cents per share. This was primarily due to higher sales volumesowing to favorable weather.
Pennsylvania Regulated: Adjusted earnings in the reported quarter increased by 5 cents per share to 13 cents driven primarily by higher base electricity rates for distribution effective Jan 1, 2016, and higher transmission margins.
Corporate and Other: It includes unallocated corporate-level financing and other costs. Adjusted loss widened from 2 cents to 3 cents per share.
PPL Corp.’s total operating expenses decreased 7.5% year over year to $1,103 million in the reported quarter primarily due to lower energy purchases, and a decline in other operation and maintenance expenses.
The company registered operating income of $786 million, up 14.6% from $686 million a year ago.
Interest expenses were up marginally to $223 million from $221 million a year ago.
Financial Position
As of Sep 30, 2016, PPL Corp. had cash and cash equivalents of $416 million, compared with $836 million as of Dec 31, 2015.
Long-term debt (excluding debts due within one year) was $18,069 million as of Sep 30, 2016, compared with $18,563 million as of 2015 end.
In the first nine months of 2016, net cash flow from operating activities (continuing operations) was $2,230 million, compared with $1,688 million in the prior-year period.
Guidance
PPL Corp. narrowed its 2016 adjusted earnings guidance to the range of $2.30–$2.45 per share (midpoint: $2.38).Midpoint of the adjusted earnings guidance for UK Regulated, Kentucky Regulated and Pennsylvania Regulated are $1.41, 58 cents and 49 cents, respectively, for the year.
The company has reaffirmed its earnings guidance for 2017 in the range of $2.05–$2.25 per share (midpoint: $2.15).
The company expects annual earnings growth of 5–6% between 2017 and 2020.
Peer Releases
NextEra Energy, Inc.(NEE - Free Report) reported third-quarter 2016 adjusted earnings of $1.74 per share, outpacing the Zacks Consensus Estimate of $1.65 by 5.5%. The stock carries a Zacks Rank #3 (Hold).
Xcel Energy Inc. (XEL - Free Report) recorded third-quarter operating earnings of 90 cents per share, outpacing the Zacks Consensus Estimate of 87 cents by 3.5%. The stock carries a Zacks Rank #3.
Zacks Rank
PPL Corp. currently has a Zacks Rank #3.
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PPL Corp (PPL) Beats on Q3 Earnings, Misses on Revenues
PPL Corporation (PPL - Free Report) reported third-quarter 2016 adjusted earnings of 63 cents per share, topping the Zacks Consensus Estimate of 59 cents by 6.8%. Reported earnings also increased 23.5% on a year-over-year basis.
On a GAAP basis, the company posted earnings per share of 69 cents in the quarter, compared with 58 cents a year ago. The difference between GAAP and operating earnings in the reported quarter was due to 29 cents of foreign currency-related economic hedges, charges of 30 cents related to the settlement of foreign currency contracts,and 5 cents related to a change in the UK tax rate.
Total Revenue
PPL Corp.’s total revenue of $1,889 million missed the Zacks Consensus Estimate of $2,000 million but were up marginally from the year-ago tally of $1,878 million.
Segment Results
UK Regulated: Adjusted earnings of 35 cents per share surged 20.7% from the prior-year figure of 29 cents. This was primarily backed by the Apr 1, 2016 price increase, and lower operation and maintenance expenses, partially offset by lower sales volumes.
Kentucky Regulated: Adjusted earnings increased by 2 cents to 18 cents per share. This was primarily due to higher sales volumesowing to favorable weather.
Pennsylvania Regulated: Adjusted earnings in the reported quarter increased by 5 cents per share to 13 cents driven primarily by higher base electricity rates for distribution effective Jan 1, 2016, and higher transmission margins.
Corporate and Other: It includes unallocated corporate-level financing and other costs. Adjusted loss widened from 2 cents to 3 cents per share.
PPL CORP Price, Consensus and EPS Surprise
PPL CORP Price, Consensus and EPS Surprise | PPL CORP Quote
Operational Highlights
PPL Corp.’s total operating expenses decreased 7.5% year over year to $1,103 million in the reported quarter primarily due to lower energy purchases, and a decline in other operation and maintenance expenses.
The company registered operating income of $786 million, up 14.6% from $686 million a year ago.
Interest expenses were up marginally to $223 million from $221 million a year ago.
Financial Position
As of Sep 30, 2016, PPL Corp. had cash and cash equivalents of $416 million, compared with $836 million as of Dec 31, 2015.
Long-term debt (excluding debts due within one year) was $18,069 million as of Sep 30, 2016, compared with $18,563 million as of 2015 end.
In the first nine months of 2016, net cash flow from operating activities (continuing operations) was $2,230 million, compared with $1,688 million in the prior-year period.
Guidance
PPL Corp. narrowed its 2016 adjusted earnings guidance to the range of $2.30–$2.45 per share (midpoint: $2.38).Midpoint of the adjusted earnings guidance for UK Regulated, Kentucky Regulated and Pennsylvania Regulated are $1.41, 58 cents and 49 cents, respectively, for the year.
The company has reaffirmed its earnings guidance for 2017 in the range of $2.05–$2.25 per share (midpoint: $2.15).
The company expects annual earnings growth of 5–6% between 2017 and 2020.
Peer Releases
NextEra Energy, Inc.(NEE - Free Report) reported third-quarter 2016 adjusted earnings of $1.74 per share, outpacing the Zacks Consensus Estimate of $1.65 by 5.5%. The stock carries a Zacks Rank #3 (Hold).
WEC Energy Group (WEC - Free Report) reported third-quarter 2016 adjusted earnings of 69 cents per share, beating the Zacks Consensus Estimate of 60 cents by 15%. The stock carries a Zacks Rank #2 (Buy).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Xcel Energy Inc. (XEL - Free Report) recorded third-quarter operating earnings of 90 cents per share, outpacing the Zacks Consensus Estimate of 87 cents by 3.5%. The stock carries a Zacks Rank #3.
Zacks Rank
PPL Corp. currently has a Zacks Rank #3.
Confidential from Zacks
Beyond this Analyst Blog, would you like to see Zacks' best recommendations that are not available to the public? Our Executive VP, Steve Reitmeister, knows when key trades are about to be triggered and which of our experts has the hottest hand. Click to see them now>>