EX-12.A 4 ppl10q-exhibit12a.htm EXHIBIT 12(A) ppl10q-exhibit12a.htm
Exhibit 12(a)
PPL CORPORATION AND SUBSIDIARIES
 
COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED STOCK DIVIDENDS
(Millions of Dollars)
 
   
9 Months
Ended
September 30,
  
12 Months
Ended
December 31,
   
2007
  
2006 (d)
  
2005 (d)
  
2004 (d)
  
2003 (d)
  
2002 (d)
Earnings, as defined:
                                                
Net income (a)
  
$
800
    
$
842
    
$
695
    
$
681
    
$
772
    
$
401
  
Preferred security dividend requirements
    
14
      
14
      
2
      
2
      
29
      
66
  
Less undistributed income (loss) of equity method investments
            
3
      
2
      
(1
)
    
(5
)
    
(9
)
Income taxes
    
188
      
268
      
128
      
196
      
162
      
214
  
Total fixed charges as below (excluding capitalized interest, preferred security distributions of subsidiaries on a pre-tax basis and interest expense related to discontinued operations)
    
376
      
476
      
505
      
519
      
494
      
573
  
                                                 
Total earnings
  
$
1,378
    
$
1,597
    
$
1,328
    
$
1,399
    
$
1,462
    
$
1,263
  
                                                 
Fixed charges, as defined:
                                                
Interest on long-term debt
  
$
395
    
$
482
    
$
465
    
$
491
    
$
417
    
$
486
  
Interest on short-term debt and other interest
    
20
      
13
      
29
      
20
      
25
      
70
  
Amortization of debt discount, expense and premium - net
    
6
      
11
      
23
      
8
      
41
      
25
  
Estimated interest component of operating rentals
    
18
      
29
      
32
      
34
      
45
      
38
  
Preferred securities distributions of subsidiaries on a pre-tax basis
    
17
      
24
      
5
      
5
      
45
      
79
  
                                                 
Total fixed charges (b)
  
$
456
    
$
559
    
$
554
    
$
558
    
$
573
    
$
698
  
                                                 
Ratio of earnings to fixed charges
    
3.0
      
2.9
      
2.4
      
2.5
      
2.6
      
1.8
  
Ratio of earnings to combined fixed charges and preferred stock dividends (c)
    
3.0
      
2.9
      
2.4
      
2.5
      
2.6
      
1.8
  

(a)
  
Net income excludes minority interest, discontinued operations and the cumulative effects of changes in accounting principles.
(b)
  
Interest on unrecognized tax benefits is not included in fixed charges.
(c)
  
PPL, the parent holding company, does not have any preferred stock outstanding; therefore, the ratio of earnings to combined fixed charges and preferred stock dividends is the same as the ratio of earnings to fixed charges.
(d)
  
Certain line items have been revised due to the planned sale of PPL's natural gas distribution and propane businesses and the related reclassification of prior period operating results to Discontinued Operations.