EX-12.A 7 form10q-exhibit12a.htm EXHIBIT 12(A) form10q-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
                              
           
Sep. 30,
  
Years Ended December 31,
           
2014
  
2013(a)
  
2012(a)
  
2011(a)
  
2010(a)
  
2009(a)
Earnings, as defined:
                                  
   
Income from Continuing Operations Before
                                  
     
Income Taxes (b)
$
 1,552
  
$
 1,260
  
$
 2,009
  
$
 2,050
  
$
 1,218
  
$
 474
   
Adjustment to reflect earnings from equity method
                                  
     
investments on a cash basis (c)
  
 
    
 
    
 34
    
 1
    
 7
    
 1
         
 1,552
    
 1,260
    
 2,043
    
 2,051
    
 1,225
    
 475
                                             
   
Total fixed charges as below
  
 821
    
 1,096
    
 1,065
    
 1,022
    
 698
    
 513
       
Less:
                                  
       
Capitalized interest
  
 25
    
 47
    
 53
    
 51
    
 30
    
 43
       
Preferred security distributions of subsidiaries
                                  
         
on a pre-tax basis
  
 
    
 
    
 5
    
 23
    
 21
    
 24
       
Interest expense and fixed charges related to
                                  
         
discontinued operations
  
 6
    
 12
    
 10
    
 3
    
 31
    
 22
   
Total fixed charges included in Income from
                                  
     
Continuing Operations Before Income Taxes
  
 790
    
 1,037
    
 997
    
 945
    
 616
    
 424
                                             
       
Total earnings
$
 2,342
  
$
 2,297
  
$
 3,040
  
$
 2,996
  
$
 1,841
  
$
 899
                                             
Fixed charges, as defined:
                                  
   
Interest charges (d)
$
 810
  
$
 1,058
  
$
 1,019
  
$
 955
  
$
 637
  
$
 446
   
Estimated interest component of operating rentals
  
 11
    
 38
    
 41
    
 44
    
 39
    
 42
   
Preferred security distributions of subsidiaries
                                  
     
on a pre-tax basis
  
 
    
 
    
 5
    
 23
    
 21
    
 24
   
Fixed charges of majority-owned share of 50% or
                                  
     
less-owned persons
  
 
    
 
    
 
    
 
    
 1
    
 1
                                             
       
Total fixed charges (e)
$
 821
  
$
 1,096
  
$
 1,065
  
$
 1,022
  
$
 698
  
$
 513
                                             
Ratio of earnings to fixed charges
  
 2.9
    
 2.1
    
 2.9
    
 2.9
    
 2.6
    
 1.8
Ratio of earnings to combined fixed charges and
                                  
 
preferred stock dividends (f)
  
 2.9
    
 2.1
    
 2.9
    
 2.9
    
 2.6
    
 1.8

(a)
  
Years 2009 through 2013 have been adjusted to reflect the reclassification of certain PPL Montana hydroelectric generating facilities and related assets as Discontinued Operations.  See Note 8 to the Financial Statements for additional information.
(b)
  
To facilitate the sale of the hydroelectric generating facilities referred to in (a) above, in December 2013, PPL Montana terminated a lease agreement which resulted in a $697 million charge.  See Note 8 to the Financial Statements in PPL's 2013 Form 10-K for additional information.
(c)
  
Includes other-than-temporary impairment loss of $25 million in 2012.
(d)
  
Includes interest on long-term and short-term debt, as well as amortization of debt discount, expense and premium - net.
(e)
  
Interest on unrecognized tax benefits is not included in fixed charges.
(f)
  
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.
 
150