PPL CORPORATION AND SUBSIDIARIES COMPUTATION OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS (Millions of Dollars) | |||||||||||||||||||||||||
2002 | 2001 | 2000 | 1999 | 1998 | |||||||||||||||||||||
Fixed charges, as defined: | |||||||||||||||||||||||||
Interest on long-term debt | $ | 486 | $ | 351 | $ | 323 | $ | 233 | $ | 203 | |||||||||||||||
Interest on short-term debt and other interest | 71 | 44 | 64 | 47 | 33 | ||||||||||||||||||||
Amortization of debt discount, expense and premium - net | 25 | 17 | 5 | 4 | 2 | ||||||||||||||||||||
Interest on capital lease obligations | |||||||||||||||||||||||||
Charged to expense | 4 | 9 | 8 | ||||||||||||||||||||||
Capitalized | 1 | 2 | |||||||||||||||||||||||
Estimated interest component of operating rentals | 39 | 36 | 25 | 20 | 18 | ||||||||||||||||||||
Preferred stock dividends of subsidiaries on a pre-tax basis | 79 | 64 | 31 | 30 | 31 | ||||||||||||||||||||
Total fixed charges | $ | 700 | $ | 512 | $ | 452 | $ | 344 | $ | 297 | |||||||||||||||
Earnings, as defined: | |||||||||||||||||||||||||
Net income (a) | $ | 436 | $ | 167 | $ | 491 | $ | 492 | $ | 379 | |||||||||||||||
Preferred security dividend requirements | 67 | 52 | 26 | 26 | 25 | ||||||||||||||||||||
Less undistributed income (loss) of equity method investments | (23 | ) | 20 | 74 | 56 | 3 | |||||||||||||||||||
526 | 199 | 443 | 462 | 401 | |||||||||||||||||||||
Add: | |||||||||||||||||||||||||
Income taxes | 210 | 261 | 294 | 174 | 259 | ||||||||||||||||||||
Amortization of capitalized interest on capital leases | 2 | 2 | 2 | ||||||||||||||||||||||
Total fixed charges as above (excluding capitalized interest, capitalized interest on capital lease obligations and preferred stock dividends of subsidiaries on a pre-tax basis) | 600 | 419 | 405 | 307 | 257 | ||||||||||||||||||||
Total earnings | $ | 1,336 | $ | 879 | $ | 1,144 | $ | 945 | $ | 919 | |||||||||||||||
Ratio of earnings to fixed charges (b) | 1.9 | 1.7 | 2.5 | 2.7 | 3.1 | ||||||||||||||||||||
Ratio of earnings to combined fixed charges and preferred stock dividends (b) (c) | 1.9 | 1.7 | 2.5 | 2.7 | 3.1 | ||||||||||||||||||||
(a) | Net income excludes extraordinary item, minority interest and the cumulative effect of a change in accounting principle. | ||||||||||||||||||||||||
(b) | Ratio of earnings to fixed charges for years 2001 and prior were recalculated to give proper effect of preferred security dividends of subsidiaries on a pre-tax basis. | ||||||||||||||||||||||||
(c) | 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. |