Segment and Related Information

12 Months Ended

Dec. 31, 2019

(PPL)

PPL is organized into three segments: U.K. Regulated, Kentucky Regulated and Pennsylvania Regulated. PPL's segments are segmented by geographic location.

The U.K. Regulated segment consists of PPL Global, which primarily includes WPD's regulated electricity distribution operations, the results of hedging the translation of WPD's earnings from GBP into U.S. dollars, and certain costs, such as U.S. income taxes, administrative costs, and certain acquisition-related financing costs.

The Kentucky Regulated segment consists primarily of LKE's regulated electricity generation, transmission and distribution operations of LG&E and KU, as well as LG&E's regulated distribution and sale of natural gas. In addition, certain acquisition-related financing costs are allocated to the Kentucky Regulated segment.

The Pennsylvania Regulated segment includes the regulated electricity transmission and distribution operations of PPL Electric. In addition, certain costs are allocated to the Pennsylvania Regulated segment.

"Corporate and Other" primarily includes financing costs incurred at the corporate level that have not been allocated or assigned to the segments, certain other unallocated costs, as well as the financial results of Safari Energy, which is presented to reconcile segment information to PPL's consolidated results.

Income Statement data for the segments and reconciliation to PPL's consolidated results for the years ended December 31 are as follows:



	2019			2018			2017
Operating Revenues from external customers (a)
U.K. Regulated	$	2,167		$	2,268		$	2,091
Kentucky Regulated	3,206			3,214			3,156
Pennsylvania Regulated	2,358			2,277			2,195
Corporate and Other	38			26			5
Total	$	7,769		$	7,785		$	7,447

Depreciation
U.K. Regulated	$	250		$	247		$	230
Kentucky Regulated	547			475			439
Pennsylvania Regulated	386			352			309
Corporate and Other	16			20			30
Total	$	1,199		$	1,094		$	1,008

Amortization (b)
U.K. Regulated	$	25		$	34		$	34
Kentucky Regulated	27			18			24
Pennsylvania Regulated	24			22			33
Corporate and Other	5			4			6
Total	$	81		$	78		$	97

Unrealized (gains) losses on derivatives and other hedging activities (c)
U.K. Regulated	$	62		$	(190	)	$	166
Kentucky Regulated	6			6			6
Corporate and Other	5			(2		)	6
Total	$	73		$	(186	)	$	178

Interest Expense
U.K. Regulated	$	405		$	413		$	397
Kentucky Regulated	298			274			261
Pennsylvania Regulated	169			159			142
Corporate and Other	122			117			101
Total	$	994		$	963		$	901

Income Before Income Taxes
U.K. Regulated	$	1,169		$	1,339		$	804
Kentucky Regulated	530			531			645
Pennsylvania Regulated	607			567			575
Corporate and Other	(151		)	(152		)	(112		)
Total	$	2,155		$	2,285		$	1,912

Income Taxes (d)
U.K. Regulated	$	192		$	225		$	152
Kentucky Regulated	94			120			359
Pennsylvania Regulated	149			136			216
Corporate and Other	(26		)	(23		)	57
Total	$	409		$	458		$	784

Deferred income taxes and investment tax credits (e)
U.K. Regulated	$	140		$	118		$	66
Kentucky Regulated	82			94			294
Pennsylvania Regulated	90			125			257
Corporate and Other	(3		)	18			90
Total	$	309		$	355		$	707



	2019			2018			2017

Net Income
U.K. Regulated	$	977		$	1,114		$	652
Kentucky Regulated	436			411			286
Pennsylvania Regulated	458			431			359
Corporate and Other	(125		)	(129		)	(169		)
Total	$	1,746		$	1,827		$	1,128


(a)	See Note 1 and Note 3 for additional information on Operating Revenues.


(b)	Represents non-cash expense items that include amortization of operating lease right-of-use assets, regulatory assets, debt discounts and premiums and debt issuance costs.


(c)	Includes unrealized gains and losses from economic activity. See Note 17 for additional information.


(d)	Represents both current and deferred income taxes, including investment tax credits. See Note 6 for additional information on the impact of the TCJA in 2018 and 2017.


(e)	Represents a non-cash expense item that is also included in "Income Taxes."

Cash Flow data for the segments and reconciliation to PPL's consolidated results for the years ended December 31 are as follows:



	2019		2018		2017
Expenditures for long-lived assets
U.K. Regulated	$	857	$	954	$	1,015
Kentucky Regulated	1,097		1,117		892
Pennsylvania Regulated	1,121		1,196		1,254
Corporate and Other	32		1		10
Total	$	3,107	$	3,268	$	3,171

The following provides Balance Sheet data for the segments and reconciliation to PPL's consolidated results as of:



	As of December 31,
	2019		2018
Total Assets
U.K. Regulated (a)	$	17,622	$	16,700
Kentucky Regulated	15,597		15,078
Pennsylvania Regulated	11,918		11,257
Corporate and Other (b)	543		361
Total	$	45,680	$	43,396


(a)	Includes $13.2 billion and $12.4 billion of net PP&E as of December 31, 2019 and December 31, 2018. WPD is not subject to accounting for the effects of certain types of regulation as prescribed by GAAP.


(b)	Primarily consists of unallocated items, including cash, PP&E, goodwill, the elimination of inter-segment transactions as well as the assets of Safari Energy.

Geographic data for the years ended December 31 are as follows:



	2019		2018		2017
Revenues from external customers
U.K.	$	2,167	$	2,268	$	2,091
U.S.	5,602		5,517		5,356
Total	$	7,769	$	7,785	$	7,447



	As of December 31,
	2019		2018
Long-Lived Assets
U.K.	$	13,618	$	12,791
U.S.	23,607		22,384
Total	$	37,225	$	35,175

(PPL Electric, LKE, LG&E and KU)

PPL Electric has two operating segments that are aggregated into a single reportable segment. LKE, LG&E and KU are individually single operating and reportable segments.