EX-12.A 2 form8kexhibit12_a.htm EXHIBIT 12(A) form8kexhibit12_a.htm

PPL CORPORATION AND SUBSIDIARIES
 
COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED STOCK DIVIDENDS
(Millions of Dollars)
 
   
2008 (a)
  
2007 (a)
  
2006 (a)
  
2005 (a)
  
2004 (a)
Earnings, as defined:
                                        
Income from Continuing Operations Before Income Taxes (b) (c)
  
$
1,357
    
$
1,281
    
$
1,099
    
$
780
    
$
849
  
Less earnings of equity method investments
    
1
      
3
      
4
      
5
      
3
  
Distributed income from equity method investments
    
1
      
5
      
3
      
5
      
5
  
     
1,357
      
1,283
      
1,098
      
780
      
851
  
                                         
Total fixed charges as below
    
568
      
609
      
559
      
569
      
563
  
Less:
                                        
Capitalized interest
    
59
      
58
      
24
      
9
      
6
  
Preferred security distributions of subsidiaries on a pre-tax basis
    
27
      
23
      
24
      
5
      
5
  
Interest expense related to discontinued operations
    
8
      
35
      
36
      
37
      
30
  
Total fixed charges included in Income from Continuing Operations Before Income Taxes
    
474
      
493
      
475
      
518
      
522
  
                                         
Total earnings
  
$
1,831
    
$
1,776
    
$
1,573
    
$
1,298
    
$
1,373
  
                                         
Fixed charges, as defined:
                                        
Interest on long-term debt (b)
  
$
478
    
$
522
    
$
482
    
$
480
    
$
496
  
Interest on short-term debt and other interest
    
28
      
35
      
13
      
29
      
20
  
Amortization of debt discount, expense and
premium - net
    
12
      
8
      
11
      
23
      
8
  
Estimated interest component of operating rentals
    
22
      
21
      
29
      
32
      
34
  
Preferred securities distributions of subsidiaries on a pre-tax basis
    
27
      
23
      
24
      
5
      
5
  
Fixed charges of majority-owned share of 50% or less-owned persons
    
1
                                  
                                         
Total fixed charges (d)
  
$
568
    
$
609
    
$
559
    
$
569
    
$
563
  
                                         
Ratio of earnings to fixed charges
    
3.2
      
2.9
      
2.8
      
2.3
      
2.4
  
Ratio of earnings to combined fixed charges and preferred stock dividends (e)
    
3.2
      
2.9
      
2.8
      
2.3
      
2.4
  

(a)
  
Certain line items have been revised due to the anticipated sales of the Long Island generation business and the majority of the Maine hydroelectric generation business and the related reclassification of operating results to Discontinued Operations.  See Note 10 to the Financial Statements for additional information.
(b)
  
2005 and 2004 were revised to reflect the retrospective application of FSP APB 14-1.  See Note 1 to the Financial Statements for additional information.
(c)
  
Revised to reflect the retrospective application of SFAS 160.  See Note 1 to the Financial Statements for additional information.
(d)
  
Interest on unrecognized tax benefits is not included in fixed charges.
(e)
  
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.