Exhibit 12(a)
PPL CORPORATION AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND
PREFERRED STOCK DIVIDENDS
(Millions of Dollars)
Nine Months Ended September 30, | Years Ended December 31, (a) | ||||||||||||||||||||||
2016 | 2015 | 2014 | 2013 | 2012 | 2011 | ||||||||||||||||||
Earnings, as defined: | |||||||||||||||||||||||
Income from Continuing Operations Before Income Taxes | $ | 1,947 | $ | 2,068 | $ | 2,129 | $ | 1,728 | $ | 1,406 | $ | 922 | |||||||||||
Adjustment to reflect earnings from equity method investments on a cash basis (b) | — | (1 | ) | — | — | 34 | — | ||||||||||||||||
1,947 | 2,067 | 2,129 | 1,728 | 1,440 | 922 | ||||||||||||||||||
Total fixed charges as below | 689 | 1,054 | 1,095 | 1,096 | 1,065 | 1,022 | |||||||||||||||||
Less: | |||||||||||||||||||||||
Capitalized interest | 3 | 11 | 11 | 11 | 6 | 4 | |||||||||||||||||
Preferred security distributions of subsidiaries on a pre-tax basis | — | — | — | — | 5 | 23 | |||||||||||||||||
Interest expense and fixed charges related to discontinued operations | — | 150 | 186 | 235 | 235 | 231 | |||||||||||||||||
Total fixed charges included in Income from Continuing Operations Before Income Taxes | 686 | 893 | 898 | 850 | 819 | 764 | |||||||||||||||||
Total earnings | $ | 2,633 | $ | 2,960 | $ | 3,027 | $ | 2,578 | $ | 2,259 | $ | 1,686 | |||||||||||
Fixed charges, as defined: | |||||||||||||||||||||||
Interest charges (c) | $ | 681 | $ | 1,038 | $ | 1,073 | $ | 1,058 | $ | 1,019 | $ | 955 | |||||||||||
Estimated interest component of operating rentals | 8 | 16 | 22 | 38 | 41 | 44 | |||||||||||||||||
Preferred security distributions of subsidiaries on a pre-tax basis | — | — | — | — | 5 | 23 | |||||||||||||||||
Total fixed charges (d) | $ | 689 | $ | 1,054 | $ | 1,095 | $ | 1,096 | $ | 1,065 | $ | 1,022 | |||||||||||
Ratio of earnings to fixed charges | 3.8 | 2.8 | 2.8 | 2.4 | 2.1 | 1.7 | |||||||||||||||||
Ratio of earnings to combined fixed charges and preferred stock dividends (e) | 3.8 | 2.8 | 2.8 | 2.4 | 2.1 | 1.7 |
(a) | Reflects PPL's Supply segment as Discontinued Operations. See Note 8 to the Financial Statements for additional information. | |
(b) | Includes other-than-temporary impairment loss of $25 million in 2012. | |
(c) | Includes interest on long-term and short-term debt, as well as amortization of debt discount, expense and premium - net. | |
(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. |