PPL Corporation (PPL) Q2 2023 Earnings Call Transcript

For the period ending June 30, 2023

August 4, 2023 10:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good day, and welcome to the PPL Corporation Second Quarter 2023 Earnings Conference Call. [Operator Instructions] Note that this event is being recorded. I would now like to turn the conference over to Andy Ludwig, Vice President, Investor Relations. Please go ahead.

Andy Ludwig

Good morning, everyone, and thank you for joining the PPL Corporation conference call on second quarter 2023 financial results. We have provided slides for this presentation on the Investors section of our website. We’ll begin today’s call with updates from Vince Sorgi, PPL President and CEO; and Joe Bergstein, Chief Financial Officer. And we’ll conclude with a Q&A session following our prepared remarks.

Before we get started, I’ll draw your attention to Slide 2 in a brief cautionary statement. Our presentation today contains forward-looking statements about future operating results or other future events. Actual results may differ materially from these forward-looking statements. Please refer to the appendix of this presentation and PPL’s SEC filings for a discussion of some of the factors that could cause actual results to differ from the forward-looking statements. We will also refer to non-GAAP measures including earnings from ongoing operations on this call. For reconciliation to the comparable GAAP measures, please refer to the appendix.

I’ll now turn the call over to Vince.

Vince Sorgi

Thank you, Andy, and good morning, everyone. Welcome to our second quarter investor update. Let’s start with our financial results and a few highlights from the quarter on Slide 4. Today, we announced second quarter reported earnings of $0.15 per share. Adjusting for special items, second quarter earnings from ongoing operations were $0.29 per share compared with $0.30 per share a year ago. Overall, second quarter results were in line with our expectations apart from the continued mild weather and storm activity in Kentucky and Pennsylvania, as this has been one of the most active storm years we’ve ever experienced. Between the mild weather and storm O&M, our year-to-date results were negatively impacted by about $0.09 per share compared to our original plan. But despite these impacts, we remain confident in our ability to deliver on our 2023 ongoing earnings forecast of $1.50 to $1.65 per share with a midpoint of $1.58 per share.

We have identified several areas in which we can offset the headwinds from weather and storms, and Joe will cover that in detail in his financial review. As you know, one area we remain extremely focused on is O&M, and we are on track to achieve the $50 million to $60 million targeted reductions this year. And despite the incremental storm expenses, we are tracking slightly ahead of our O&M forecast through June. We expect that trend to continue and improve through the second half of the year. In addition, today, we reaffirmed our projected earnings per share and dividend growth rate of 6% to 8% through at least 2026, as we remain confident in our low-risk business plan. This will be supported by our $12 billion capital investment plan and targeted O&M savings of at least $175 million by 2026 to advance a reliable, resilient, affordable and clean energy future.