PPL(PPL)2024-08-02 18:42Financial Data and Key Metrics Changes - PPL Corporation reported second quarter GAAP earnings of $0.26 per share, an increase from $0.15 per share in Q2 2023. Adjusted ongoing earnings were $0.38 per share, up $0.09 from the previous year [22][3][4] - Year-to-date GAAP earnings reached $0.67 per share compared to $0.54 per share in the same period last year. Adjusted ongoing earnings for the first half of 2024 totaled $0.92 per share, an improvement of $0.15 per share compared to the first half of 2023 [22][23] Business Line Data and Key Metrics Changes - The Kentucky segment's results increased by $0.05 per share compared to Q2 2023, driven by higher sales volumes and lower operating costs [24] - The Pennsylvania Regulated segment also saw an increase of $0.05 per share, attributed to higher transmission revenues and increased usage per customer [24] - The Rhode Island segment's results improved by $0.01 per share, mainly due to higher distribution and transmission revenues, offset by increased operating costs [25] Market Data and Key Metrics Changes - PPL has over 17 gigawatts of interconnection requests in Pennsylvania, with nearly 5 gigawatts in advanced planning stages, up from 3 gigawatts previously discussed [13] - The company estimates that for every 1 gigawatt of data center demand connected to the grid, residential customers could save about 10% on the transmission portion of their bill, translating to approximately $3 monthly savings [14] Company Strategy and Development Direction - PPL's "Utility of the Future" strategy aims for a net zero energy system by 2050 while ensuring reliability and affordability [6][7] - The company plans to invest $14.3 billion in infrastructure improvements from 2024 to 2027, focusing on decarbonization and enhancing grid reliability [5][6] - PPL is actively pursuing partnerships for R&D in low-carbon technologies, including advanced nuclear and carbon capture [8][9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving the 2024 ongoing earnings forecast of $1.63 to $1.75 per share, with a focus on maintaining a strong balance sheet to support investment needs [3][26] - The company is positioned to achieve annual earnings per share and dividend growth of 6% to 8% through at least 2027 [5][26] Other Important Information - PPL is on track to complete approximately $3.1 billion in infrastructure improvements in 2024 [4] - The Pennsylvania PUC approved modifications to PPL's long-term infrastructure improvement plan, allowing for $200 million of reliability investments to be classified as capital eligible for recovery [18] Q&A Session Summary Question: Insights on transmission side and capacity auction implications - Management acknowledged the need for generation and transmission investments in PJM, indicating potential opportunities for additional transmission solutions [29][30] Question: Impact of PJM auction results on customer bills - Management estimated that higher prices could increase the generation portion of the bill by about $10 to $15 per month for average customers starting in 2025 [37] Question: Balance sheet capacity and CapEx considerations - Management confirmed a strong balance sheet and indicated that capital needs would be assessed in light of various factors, including interest rates and inflation [39][40] Question: Kentucky IRP and potential new generation needs - Management stated that a comprehensive load forecast would be conducted to determine if new generation is necessary, with results expected in October [43][44] Question: Data center demand and associated CapEx - Management indicated that formal announcements regarding data center demand would likely come at the end of the year or early next year [56][57]