ALLENTOWN, Pa.---PP&L Resources, Inc. (NYSE: PPL) Wednesday (4/28) reported 1999 first quarter earnings of 70 cents per share compared with 60 cents per share for the same period a year ago, an increase of 16 percent.

First Quarter Financial Statements

"The company's revenues are continuing to increase as the result of our overseas investments, our new domestic acquisitions and our success in marketing energy in both the wholesale and the deregulated retail market," said John R. Biggar, PP&L Resources senior vice president and chief financial officer. "These sharp revenue increases, combined with our continued attention to controlling costs in our regulated businesses, have led to improvement in earnings."

When adjusted to exclude the effects of weather, the company's earnings for the first quarter were 73 cents per share, compared with 71 cents per share for similarly adjusted earnings in the first quarter of 1998.

Biggar said that the first quarter earnings per share improvement is due primarily to higher earnings from the company's PP&L Global overseas investments; from new earnings from Penn Fuel Gas, which the company acquired during the past year; from wholesale and retail marketing activities; and from the effects of the company's 1998 stock repurchase program.

The improvement from these items was offset somewhat by a 4 percent rate reduction for electricity delivery customers; higher purchased power costs by PP&L EnergyPlus, the company's retail marketing subsidiary; and increases in wages, benefits and other operating costs in wholesale and retail marketing.

"We are continuing to produce sales growth increases, despite the challenges of competition in our retail market," said Biggar. "The results this quarter are just one more indication of the success of our strategy in the evolving energy market."

Biggar said first quarter earnings keep the company on target to achieve the $2.15 per share 1999 earnings that its current business plan projects. "This quarter's numbers are consistent with our projections that PP&L Resources' earnings for 1999 will increase by an annual rate of 3.9 percent over 1998 adjusted earnings of $2.07 per share," said Biggar.

For the years 2000 and 2001, Biggar said the company is forecasting earnings per share of $2.40 and $2.60, respectively, without factoring in the expected benefits of securitization. Earnings of $2.60 per share in 2001 represent a compound annual growth rate of 7.9 percent from 1998 adjusted earnings, he said.

PP&L, Inc., the company's electric utility subsidiary, is planning to securitize up to $2.85 billion of transition costs early in the third quarter, subject to necessary approvals from the state Public Utility Commission.

In anticipation of this securitization, PP&L Resources last week announced a program for the repurchase, from time to time, of up to 4 million shares of its common stock on the open market, depending on market conditions. This program is in addition to a 3 million share repurchase program that the company announced in September 1998.

Biggar said that securitization is expected to increase the company's 2000 earnings forecast by 5 cents per share to $2.45, and the 2001 forecast by 10 cents to $2.70 per share.

The company also reported adjusted 12-month-ended March 31, 1999, earnings of $2.08 per share, up from $1.99 per share of similarly adjusted earnings in the first quarter of last year. These adjusted earnings exclude the effects of weather, charges related to the transition to a competitive electricity market in Pennsylvania and an income tax rate change affecting its investment in the United Kingdom.

The reported amount for the 12 months ended March 31, 1999, was a loss of $3.44 compared with earnings of $1.69 for the same period in 1998. The current period amount reflects $948 million in net after-tax write offs related to the settlement of the company's restructuring case before the Pennsylvania Public Utility Commission and another competition-related case before the Federal Energy Regulatory Commission.

Biggar said that the improvement in 12-month-ended adjusted earnings is due to essentially the same factors as those that improved first quarter earnings.