Business Segments

DPL currently manages its business through two reportable operating segments, the T&D segment and the Generation segment. The primary segment performance measure is income / (loss) from continuing operations before income tax as management has concluded that this measure best reflects the underlying business performance of DPL and is the most relevant measure considered in DPL’s internal evaluation of the financial performance of its segments. The segments are discussed further below:

Transmission and Distribution Segment

The T&D segment is comprised primarily of DP&L’s electric transmission and distribution businesses, which distribute electricity to residential, commercial, industrial and governmental customers. DP&L distributes electricity to more than 521,000 retail customers who are located in a 6,000 square mile area of West Central Ohio. DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses and records regulatory assets when incurred costs are expected to be recovered in future customer rates, and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs. The T&D segment includes revenues and costs associated with DP&L's investment in OVEC and the historical results of DP&L’s Beckjord and Hutchings Coal generating facilities, which were either closed or sold in prior periods. As these assets were not transferred to AES Ohio Generation, they are grouped with the T&D assets for segment reporting purposes. In addition, regulatory deferrals and collections, which include fuel deferrals in historical periods, are included in the T&D segment.

Generation Segment

The Generation segment is comprised of AES Ohio Generation and the historical results of DP&L's electric generation business prior to Generation Separation. Beginning in 2001, Ohio law gave consumers the right to choose the electric generation supplier from whom they purchase retail generation services. AES Ohio Generation owns and operates coal-fired and peaking generating facilities and sells its generated energy and capacity into the PJM wholesale market. The 2015 Generation segment results also include sales to DPLER and to the T&D segment for SSO customers.

Included within the “Other” column are other businesses that do not meet the GAAP requirements for disclosure as reportable segments as well as certain corporate costs, which include interest expense on DPL’s debt and adjustments related to purchase accounting from the Merger. The accounting policies of the reportable segments are the same as those described in Note 1 – Overview and Summary of Significant Accounting Policies. Intersegment sales and profits are eliminated in consolidation. Certain shared and corporate costs are allocated among reporting segments.

The following tables present financial information for each of DPL’s reportable business segments:



$ in millions	T&D		Generation			Other			Adjustments and Eliminations			DPL Consolidated
Year ended December 31, 2017
Revenues from external customers	$	718.9	$	507.9		$	10.1		$	—		$	1,236.9
Intersegment revenues	1.1		—			4.4			(5.5		)	—
Total revenues	$	720.0	$	507.9		$	14.5		$	(5.5	)	$	1,236.9

Depreciation and amortization	$	75.3	$	20.9		$	10.7		$	—		$	106.9
Fixed-asset impairment (Note 15)	$	—	$	66.3		$	109.5		$	—		$	175.8
Interest expense	$	30.5	$	0.1		$	79.5		$	—		$	110.1
Income / (loss) from continuing operations before income tax	$	88.5	$	(18.5	)	$	(189.9	)	$	—		$	(119.9	)

Cash capital expenditures	$	85.6	$	31.3		$	4.6		$	—		$	121.5

Total assets (end of year)	$	1,689.4	$	275.0		$	468.0		$	(383.2	)	$	2,049.2



$ in millions	T&D		Generation			Other			Adjustments and Eliminations			DPL Consolidated
Year ended December 31, 2016
Revenues from external customers	$	806.7	$	611.5		$	9.1		$	—		$	1,427.3
Intersegment revenues	1.3		—			5.7			(7.0		)	—
Total revenues	$	808.0	$	611.5		$	14.8		$	(7.0	)	$	1,427.3

Depreciation and amortization	$	71.0	$	55.4		$	5.9		$	—		$	132.3
Fixed-asset impairment (Note 15)	$	—	$	1,353.5		$	(494.5	)	$	—		$	859.0
Interest expense	$	25.4	$	0.4		$	82.2		$	(0.3	)	$	107.7
Income / (loss) from continuing operations before income tax	$	143.0	$	(1,353.9	)	$	417.6		$	—		$	(793.3	)

Cash capital expenditures	$	83.4	$	64.2		$	0.9		$	—		$	148.5

Total assets (end of year)	$	1,710.5	$	472.3		$	673.6		$	(437.2	)	$	2,419.2



$ in millions	T&D		Generation			Other			Adjustments and Eliminations			DPL Consolidated
Year ended December 31, 2015
Revenues from external customers^(b)	$	855.5	$	770.3		$	6.7		$	(19.7	)	$	1,612.8
Intersegment revenues	1.5		186.6			4.2			(192.3		)	—
Total revenues	$	857.0	$	956.9		$	10.9		$	(212.0	)	$	1,612.8

Depreciation and amortization	$	71.5	$	72.6		$	(9.5	)	$	—		$	134.6
Goodwill impairment (Note 7)	$	—	$	—		$	317.0		$	—		$	317.0
Interest expense	$	29.8	$	2.9		$	87.4		$	(0.3	)	$	119.8
Income / (loss) from continuing operations before income tax	$	188.1	$	(28.7	)	$	(390.8	)	$	—		$	(231.4	)

Cash capital expenditures	$	98.3	$	35.2		$	3.7		$	—		$	137.2

Total assets (end of year) ^(a)	$	1,688.8	$	1,805.0		$	1,170.3		$	(1,339.4	)	$	3,324.7


(a)	Includes assets held-for-sale related to the sale of DPLER.


(b)	Wholesale revenue for the T&D segment in 2015 includes OVEC revenue of $19.7 million that was previously netted in purchased power. The impact of this netting adjustment is included in the Adjustments and Eliminations column in the table above but has no impact on consolidated revenues or Income / (loss) from continuing operations before income tax.