Assets and Liabilities Held-For-Sale and Dispositions (Notes)

12 Months Ended

Dec. 31, 2017

Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]

Discontinued Operations

On January 1, 2016, DPL closed on the sale of DPLER, its competitive retail business. The sale agreement was signed on December 28, 2015, and DPL recorded a gain on this transaction of $49.2 million in the first quarter of 2016. The gain included the impact of DPLER’s liability to DP&L that transferred with the sale on January 1, 2016.

Operating activities related to DPLER have been reclassified to "Discontinued operations" in the Consolidated Statements of Operations for the years ended December 31, 2016 and 2015.

The following table summarizes the revenues, cost of revenues, operating expenses and income tax of discontinued operations for the periods indicated:



	Years ended December 31,
$ in millions	2016			2015
Revenues	$	—		$	340.9
Cost of revenues	—			(307.0		)
Operating expenses	(0.7		)	(22.5		)
Income / (loss) from discontinued operations before income tax	(0.7		)	11.4
Gain from disposal of discontinued operations	49.2			—
Income tax expense / (benefit) from discontinued operations	19.2			(1.0		)
Income from discontinued operations	$	29.3		$	12.4

Cash flows related to discontinued operations are included in our Consolidated Statements of Cash Flows. Cash flows from operating activities for discontinued operations were $(0.7) million and $35.8 million for the years ended December 31, 2016 and 2015, respectively. Cash flows from investing activities for discontinued operations were $75.5 million and $0.5 million for the years ended December 31, 2016 and 2015, respectively. All cash generated from discontinued operations was paid to DPL through dividends for all years presented.

Assets and Liabilities Held-For-Sale and Dispositions

Assets and liabilities held-for-sale

On December 15, 2017, DPL and AES Ohio Generation entered into an asset purchase agreement with Kimura Power, LLC, as Buyer (“Kimura Power”), and, for certain limited purposes provided therein, Rockland Power Partners III, LP, as Guarantor, pursuant to which AES Ohio Generation will, subject to the terms and conditions in the asset purchase agreement, sell to Kimura Power the Peaker assets. The Peaker assets are being sold for $241.0 million in cash. The cash purchase price is subject to adjustments at closing based on working capital, capacity commitments and timing of the closing of the transaction. The sale transaction is subject to regulatory approvals and other closing conditions. The FERC approved this transaction on February 9, 2018.

As a result of entering into the asset purchase agreement, DPL recognized aggregate impairment charges with respect to the Peaker assets of $109.4 million. For more information on these impairment charges, see Note 15 – Fixed-asset Impairments of Notes to DPL's Consolidated Financial Statements.

The assets and liabilities related to the Peaker assets were classified as held-for-sale as of December 31, 2017, but the Peaker assets did not meet the criteria to be reported as discontinued operations. The following table summarizes the major classes of assets and liabilities classified as held-for-sale as of December 31, 2017:



$ in millions	December 31, 2017
Assets
Accounts receivable, net	$	3.8
Inventories	7.6
Taxes applicable to subsequent years	4.9
Property, plant & equipment, net	233.7
Other assets	0.3
Total assets of the disposal group classified as held-for-sale in the balance sheet	$	250.3

Liabilities
Accounts payable	$	3.9
Accrued taxes	3.6
Taxes payable	4.9
Asset retirement obligations	0.6
Other liabilities	0.2
Total liabilities of the disposal group classified as held-for-sale in the balance sheet	$	13.2

The Peaker assets' results of operations are reflected within continuing operations in the Consolidated Statements of Operations. The income from continuing operations before income tax for the Peaker assets was $16.9 million, $20.0 million and $23.9 million (excluding impairment charges of $109.4 million, $1.3 million and $0.0 million, respectively) for the years ended December 31, 2017, 2016, and 2015, respectively. The Peaker assets are included in the Generation segment.

Dispositions

On December 8, 2017, DPL and AES Ohio Generation completed the sale transaction of their entire undivided interest in the Miami Fort station and the Zimmer station to Dynegy Zimmer and Dynegy Miami Fort, indirect wholly-owned subsidiaries of Dynegy. On that date, AES Ohio Generation received $50.0 million in cash, plus an amount in cash equal to $20.1 million as an estimated purchase price adjustment based on estimated amounts of certain pre-closing inventories, pre-paid and other amounts, employment benefits, insurance premiums, property taxes and other payables, which will be subject to a customary post-closing reconciliation. This transaction resulted in a gain on sale of $14.0 million for the year ended December 31, 2017. Prior to the sale, the Miami Fort and Zimmer stations were included in the Generation segment.

The results of operations of the Miami Fort and Zimmer stations are presented within continuing operations in the Consolidated Statements of Operations. The combined income / (loss) from continuing operations before income tax for the Miami Fort and Zimmer stations was $25.7 million (excluding gain on sale of $14.0 million), $(13.5) million (excluding impairment charges of $294.1 million) and $5.6 million for the years ended December 31, 2017, 2016, and 2015, respectively.