PPL CEO says utilities focused on investing in sustainable energy, delivering fair shareholder returns
ORLANDO — PPL Corp., one of the largest investor-owned utility companies in the United States with total assets of $45 billion as of Sept. 30, is poised to continue its long-standing, solid financial run, said William Spence, PPL’s chairman and chief executive officer, during a company presentation Nov. 12 at the Edison Electric Institute (EEI) Financial Conference held here.
“Strategically, in my view, nothing has changed,” Spence told attendees of the presentation, which was simultaneously being webcast. “We will continue to produce long-term shareholder value while also looking at opportunities to improve upon the great business that we already have.”
At the same time, PPL is “always open to ideas. But we don’t need M&A to be successful,” said Spence, referring to mergers and acquisitions.
PPL Corp. currently controls about 8,000 megawatts of regulated electric generating capacity in the United States and delivers electricity to 10.5 million customers in Pennsylvania, Kentucky, and Great Britain.
PPL is the parent company to Safari Energy LLC, a solar power solutions provider for commercial customers in the U.S., and to seven regulated utility companies. The company also delivers natural gas and generates electricity in Kentucky.
During Spence’s formal company presentation at the EEI conference on Tuesday, he highlighted what has changed and hasn’t changed at PPL over the last year.
On the domestic front, he said that one major shift from last year to this year has been PPL’s increased focus on its Energy Forward strategy and the many things that the company is doing to advance cleaner energy.
For instance, PPL is investing more than $15 billion through 2022 in new infrastructure and technology that will create a smarter, more reliable and resilient energy grid for generations to come, Spence said.
And in the third quarter, he said PPL neared completion of a multi-year, approximately $470 million advanced meter replacement project on time and on budget in Pennsylvania, while in Kentucky, the company deployed additional advanced distribution system control technology and completed construction of a new community solar project.
“In the U.K., Western Power Distribution continued to firmly position itself for an expanded role as a distribution system operator,” said Spence.
Conversely, what hasn’t changed for PPL over the last year, said Spence, is that the company continues “to operate at an extremely high level of excellence,” with its reliability consistently ranked among the top in the industry by JD Powers, both in the United Kingdom and in the United States.
“We have a great team, great executives, great employees and they’re all focused on operational excellence,” the CEO said.
PPL earnings also continue to be solid, reported Spence, with nine straight years exceeding the midpoint of earnings guidance projections. And the company is on track to do so again for the most-recent fiscal year, he said.
Additionally, the low risk of PPL’s business model has contributed to the company’s success, Spence said, “because it has really formed a very stable base of predictable earnings and cash flow upon which we can weather little blips on the radar that don’t take us off course.”
“To be able to meet or exceed expectations on the financial front are driven by this low-risk business model,” he said.
Spence said that PPL also works diligently to have positive regulatory relationships across the board and is focused on deploying technology that improves customer service, reliability and the company’s ability to keep costs under control.
The chairman also noted that there is a “consistent and clear” strategy at each of its seven utilities, which he said will continue to deliver premier levels of customer service, invest in a sustainable energy future, maintain affordable rates for customers, and deliver fair returns for PPL shareholders.
Spence also said that, “probably the biggest single change has been what’s going on in the UK, particularly on the political front there. We think we finally see a path to Brexit. There’s a very important election coming up on Dec. 12.”
Based on the polling and based on “everything that we see,” he said that “the conservative party will in fact prevail.”
“We think that’s good news for PPL because it will ensure that Brexit does go forward on Jan. 31, as expected. That’s been a real positive catalyst, not only to the pound but to PPL’s stock price,” he said. “No matter the outcome of the election, however, I think either way, the uncertainty that will be removed will be significant.”
