Good morning, and welcome to the PPL Corporation's Second Quarter Earnings Conference Call. All participants will be in listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note, this event is being recorded. I would now like to turn the conference over to Joe Bergstein, Vice President, Investor Relations. Please go ahead.

Thank you, Emily, and good morning, everyone. Thank you for joining the PPL conference call on second quarter results and our general business outlook. We are providing slides to this presentation on our website at www.pplweb.com. Any statements made in this presentation about future operating results or other future events are forward-looking statements under the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from such forward-looking statements. A discussion of the factors that could cause actual results or events to differ is contained in the appendix to this presentation and in the company's SEC filings. We will refer to earnings from ongoing operations or ongoing earnings and other non-GAAP measures on this call. For reconciliations to the GAAP measures, you should refer to the press release which has been posted on our website and has been filed with the SEC. This time, I'd like to turn the call over to Bill Spence, PPL Chairman, President and CEO. William H. Spence - Chairman, President & Chief Executive Officer: Thank you, Joe. Good morning, everyone. We're pleased that you joined us this morning. With me on the call today are Vince Sorgi, PPL's Chief Financial Officer; and the presidents of our three business segments. Moving to slide 3, you'll see an agenda for today's discussion. As we typically do, we'll provide an overview of our quarterly and year-to-date earnings results, which I'm pleased to say include significant growth in earnings from ongoing operations. We'll discuss our 2015 earnings forecasts, which we are increasing, along with our dividend, based on the continued strong performance of our utilities, and I'll provide an operational overview as well. Vince will review our segment results and provide a more detailed financial overview. And as always, we'll have plenty…

Thank you. We will now begin the question-and-answer session. Our first question is from Daniel Eggers of Credit Suisse. Please go ahead. Dan L. Eggers - Credit Suisse Securities (USA) LLC (Broker): Hey. Good morning, guys. William H. Spence - Chairman, President & Chief Executive Officer: Good morning, Dan. Dan L. Eggers - Credit Suisse Securities (USA) LLC (Broker): Thanks for all the updates today. I guess, you know, always been a little bit greedy, you talk about through at least 2017. When we kind of look beyond that, the UK should be through the transition period as far as the normalization of incentives. When we look at the U.S. utilities, how do you guys think about the growth, and I guess with CPP coming today, how are you guys sort of think about layering that into your capital budgeting? William H. Spence - Chairman, President & Chief Executive Officer: Sure. Well, with the Clean Power Plan just being released today, obviously, we're going to need a little bit of time, as I think you are, to kind of look through what this all means. But I think as you noted in your note this morning, I think it does support potentially higher CapEx for the utilities segment, generally speaking. And I think the pieces that I've read about the Clean Power Plan are pretty consistent with what we would have expected. I think in Kentucky, we'll need to study it a little bit more closely to kind of see what the impact on our Kentucky operations might be. But I think going beyond 2017, clearly, we're going to look to incorporate whatever we may need to do to respond to the Clean Power Plan. And I think in PPL's case, as I indicated in my prepared remarks, we do…

Now, Bill, as you mentioned, the outperformance, especially in customer service, customer reliability, that we have announced in the last Q1 earnings call about $130 million of incentive revenue that resulted from our performance for the regulatory year ending in March. This year, though, as you look at our outperformance, we had also discussed that, in Vince's remarks, that in Q1, we did talk about an asset life extension. We had a major engineering study that we had performed at the end of our last regulatory period here as we head into RIIO-ED1. And as a result, we did extend the asset lives of a number of our assets. And so the 2015 outperformance and the reason we can increase guidance for 2015 was really driven by the lower depreciation expense than what we had expected or planned for, for this year. Dan L. Eggers - Credit Suisse Securities (USA) LLC (Broker): Got it. Thank you, guys. William H. Spence - Chairman, President & Chief Executive Officer: Thank you, Dan.

Our next question is from Julien Dumoulin-Smith of UBS. Please go ahead.

Hi. Good morning. William H. Spence - Chairman, President & Chief Executive Officer: Good morning. Vincent Sorgi - Chief Financial Officer & Senior Vice President: Morning.

Excellent. So, first, quick question here, just where do we stand on synergies and parent cost guidance after the spin here? I suppose that's a first consideration? Then in tandem with that, I'd also be curious, given the charge today, how do you think about tax benefits and ability to bring back cash from UK to the consequence of the charge as well. How did that play into your tax planning, if you will? William H. Spence - Chairman, President & Chief Executive Officer: Sure. Let me start and then I'll ask Vince to supplement my comments. But I think first on the corporate shared services cost or what we've called dyssynergies of the spin transaction, we've done an excellent job of identifying how we were planning to reduce many of those shared services costs that otherwise would be stranded. And we're well on track, if not ahead of plan on that. We're actually looking at opportunities for additional synergies or cost reductions as we go forward. So, I think we've done a really great job of addressing what could have been a drag on earnings. And as I mentioned in my initial remarks, part of the growth, domestically, that we're going to see comes from corporate shared services costs coming in lower than we had originally expected. So with that brief bit of background, maybe Vince, you want to put some more details around those two questions. Vincent Sorgi - Chief Financial Officer & Senior Vice President: Sure. So, Julien, let me cover your tax question. So, the spin, as I think you know, was designed to be a tax-free spin, so the $875 million loss was a pre and post tax number. There was no tax consequence of that, so the whole thing was treated as a tax-free transaction. So, really, no impact on our future tax position. I think extending bonus is probably the biggest item that would favorably, actually, impact our tax position going forward. William H. Spence - Chairman, President & Chief Executive Officer: Great. Thanks, Vince.

And then just last one, it's actually a little detailed question here. As you look at your FX hedging program, you've obviously shifted the – I suppose, the contango in the – or perhaps this contango that emerged in your hedging program for FX. Can you talk to that? Basically, in the quarter, did you shift hedges on FX or is this really just what's arrived that we're organically layering in FX hedges against each of the respective years 2015, 2016, 2017? Vincent Sorgi - Chief Financial Officer & Senior Vice President: We did, Julien. We did shift some hedges from 2015 now into 2016 and 2017. The total impact for 2015 is about $0.035.

Got it. And would it be fair to say that's pretty similar to what the uplift is in subsequent years? Vincent Sorgi - Chief Financial Officer & Senior Vice President: It is. Yeah.

Okay. Great. Well, thank you, guys. William H. Spence - Chairman, President & Chief Executive Officer: Thanks, Julien.

Our next question is from Greg Gordon of Evercore ISI. Please go ahead.

Thanks. Just a quick follow-up on Julien's last question. So, essentially, the way I think about the hedged disclosure is you're doing well enough this year in terms of meeting your earnings guidance, that you're able to raise lower end of the guidance range while still moving some of the impact – moving essentially some of the benefits of hedging out a year, is that right? Vincent Sorgi - Chief Financial Officer & Senior Vice President: That's correct, Greg.

Oh, that's good. Great. The second question is, as I think about the slide where you talked about the cash sources and uses, you give us a projection for 2015. If I look at that going out into 2016, it is right that the cash flow being repatriated back from U.K. rises to between $300 million and $500 million. Vincent Sorgi - Chief Financial Officer & Senior Vice President: That's correct.

Okay. Fantastic. And then finally, the... Vincent Sorgi - Chief Financial Officer & Senior Vice President: Wait. I'm sorry. What – rephrase the question.

Yeah. You've got – page 16 of your cash repatriation guidance for the UK Regulated segment... Vincent Sorgi - Chief Financial Officer & Senior Vice President: Right.

...has cash coming back going from $290 million to between $300 million to $500 million? Vincent Sorgi - Chief Financial Officer & Senior Vice President: Oh, yes.

So, all I'm saying is you show $290 million on the slide associated with cash coming back from the UK on that new cash sources and uses, on page 20. Vincent Sorgi - Chief Financial Officer & Senior Vice President: Yes.

And that goes up to somewhere between $300 million and $500 million as they go out to 2016 to 2018. Vincent Sorgi - Chief Financial Officer & Senior Vice President: Yeah. I would expect the next few years to look – if you look at that cash available for reinvestment line, that $250 million, I would suspect it will be around that level improving a little bit over that period. Don't forget, we also had net about $130 million that we received from supply. So, that'll go away in the 2015 number, and that'll be replaced by the higher dividends from the UK. So...

Okay. Got it. Got it. Great. Okay. Thank you. And then, my final question is the CapEx and rate base forecast for 2019. I just want to be clear, does that include or exclude this potential Compass project in Pennsylvania? William H. Spence - Chairman, President & Chief Executive Officer: That excludes it, Greg. It's not in there.

Okay. Great. Congratulations on the quarter. William H. Spence - Chairman, President & Chief Executive Officer: Thanks very much, Greg. Appreciate it.

Our next question is from Paul Patterson of Glenrock Associates. Please go ahead.

Good morning. How are you? William H. Spence - Chairman, President & Chief Executive Officer: Morning, Paul. Very good.

My question has been answered, really. But just – could you just go over again what happened in terms of the charge associated with supply? Just if you could just break it down like what exactly is causing it to – what's actually driving that? I mean, if you could you just sort of break it down sort of layman's terms. William H. Spence - Chairman, President & Chief Executive Officer: Sure. I'll let Vince take that one. Vincent Sorgi - Chief Financial Officer & Senior Vice President: Good morning, Paul. So, yeah. So, what happened was, we need to do an estimate of fair value at the date of spin, and then, compare that to the book value. And what we did was we used the combination of thee different valuation methodologies, basically two market approaches and one income approach which is a discounted cash flow approach. One of the market approaches was the use of a Talen market value of their equity as of the spinoff date which was the last day, as you know, of their when issued trading period. And so, that number – and we waited about a 50% weighting to that because it was publicly available information. And that was a lower number than we were expecting to end up at the end of when issued. So that, I think, drove some of the decrease in fair value, say, since year end and then just power prices have come off in PJM. So, I think when you look at the DCF, that was lower and the market approach was lower than what we were expecting combined resulted in about a $3.2 billion fair value against the $4.1 billion book value.

Okay. Great. And is that pretty much over? We shouldn't expect anything going forward on this? Vincent Sorgi - Chief Financial Officer & Senior Vice President: Yeah. No. Yeah. That's it.

Okay. Thanks so much. William H. Spence - Chairman, President & Chief Executive Officer: You're welcome.

Our next question is from Gregg Orrill of Barclays. Please go ahead. William H. Spence - Chairman, President & Chief Executive Officer: Good morning, Gregg. Gregg?

Mr. Orrill, your line...

Sorry. I was on mute there. Sorry about that. William H. Spence - Chairman, President & Chief Executive Officer: That's okay. Go ahead.

I was wondering if you could talk a little bit more about the pay-out policy. As you look out into 2016 and beyond, I know you've talked about getting below a payout of the U.S. businesses and the cash flows from the UK. How are you looking at that going forward? William H. Spence - Chairman, President & Chief Executive Officer: Just to be clear, Gregg, are you talking about the dividend payout ratio for the total dividend or just the dividends coming back from the UK?

I guess really the dividend policy 2016, 2017, et cetera. William H. Spence - Chairman, President & Chief Executive Officer: Yeah. Yeah. So, I think where we sit today in the 65% to 70% range is, I think, a comfortable range for us to continue to be in. So, I think as Vince and I have stated in the past, we'll continue to look for opportunities to modestly raise the dividend, particularly as we're going through a fairly large CapEx spending program and post that large program look to see if we could enhance it even more. But I think where we are in terms of the dividend payout ratio today is fairly consistent with our new peer group, and we're fairly comfortable with it.

Great. Thank you. William H. Spence - Chairman, President & Chief Executive Officer: Sure.

Our next question is from Keith Stanley of Wolfe Research. Please go ahead.

Hi. Good morning. One quick clarification on the asset life extension and depreciation changes in the UK this year. I think it was a $0.10 benefit for this year. How much of that benefit was in your initial 2015 guidance and is it fair to assume it's fully baked into the updated guidance now? Vincent Sorgi - Chief Financial Officer & Senior Vice President: So, there was $0.10 year-over-year that represented about $0.06 better than expectation and yes, we have that. That basically continues going forward. So, that is in our updated guidance.

Okay. So, there's $0.06 increment from the initial guidance to the updated guidance. Vincent Sorgi - Chief Financial Officer & Senior Vice President: Yes.

Okay. Thank you. Vincent Sorgi - Chief Financial Officer & Senior Vice President: Okay.

Our next question is from Neel Mitra of Tudor Pickering. Please go ahead. Neel Mitra - Tudor, Pickering, Holt & Co. Securities, Inc.: Hi. Good morning. I had a question on the ROE in the UK. You guys mentioned that it's roughly 15% to 18% through 2017. What's your overall target, I guess, once the UK earnings start to grow off at the 2017 base for that ROE? William H. Spence - Chairman, President & Chief Executive Officer: Well, go ahead, Vince. I'll let you take a stab at that one. Vincent Sorgi - Chief Financial Officer & Senior Vice President: Sure. Neel, when you say 'target', you mean where do we think ROEs are going to be kind of in the middle of RIIO? Neel Mitra - Tudor, Pickering, Holt & Co. Securities, Inc.: Yeah. After you start growing there again since, I guess, there's three years of flat earnings there? Vincent Sorgi - Chief Financial Officer & Senior Vice President: Yes. So, I would say we kind of stay in the low to mid-teens out through 2019 would be our expectation. I think we're going out a little – a little too far even at that level, to be honest with you, to give you ROE projections. But still quite healthy ROEs as, I would say, even throughout RIIO. Neel Mitra - Tudor, Pickering, Holt & Co. Securities, Inc.: Okay. And is 2017 the last year, I guess, of flat earnings, you start growing off of that base or could there be further years out where there's flat earnings? William H. Spence - Chairman, President & Chief Executive Officer: So, I think on the previous calls, we've really just talked about it being flat earnings through the 2017 period. And beyond that, beginning in 2018, we'll kind of…

Our last question is from Brian Russo of Ladenburg Thalmann. Please go ahead. Brian J. Russo - Ladenburg Thalmann & Co., Inc. (Broker): Hi. Good morning. William H. Spence - Chairman, President & Chief Executive Officer: Good morning, Brian. Brian J. Russo - Ladenburg Thalmann & Co., Inc. (Broker): Just referencing slide 5 and the pie chart with capital recovery and earning on investment, does that imply that you got a high level of confidence that you can earn your allowed ROEs or is there any sort of structural lag that we should incorporate in our outlooks? William H. Spence - Chairman, President & Chief Executive Officer: I think with the regulatory mechanisms we now have in place in Pennsylvania and Kentucky, our ability to earn near the authorized levels is greater than it's ever been, quite honestly. And so, I think the regulatory lag is minimal, probably, looking forward. And I'd also point to the fact that in both Pennsylvania and Kentucky, we're using forward test years which is the first time we've done that, historically. So, I think, those, combined with the regulatory mechanisms that we have all would suggest that we should be able to earn near the authorized levels with pretty minimal regulatory lag. Brian J. Russo - Ladenburg Thalmann & Co., Inc. (Broker): So, you probably – so after the conclusion of the current pending Pennsylvania rate case and with the recent Kentucky rate case outcome, do you think you could stay out for a few years given the mechanisms you have in place? William H. Spence - Chairman, President & Chief Executive Officer: I think, in Kentucky, probably not because, number one, we're going to have to comply with the Clean Power Plan as talked to earlier on the call, which probably will drive…

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.