KENTUCKY UTILITIES CO

The Registrants had the following at:

Net cash provided by (used in) operating, investing and financing activities for the six month periods ended June 30, and the changes between periods, were as follows.

Operating Activities

The components of the change in cash provided by (used in) operating activities for the six months ended June 30, 2026 compared with 2025 were as follows.

A majority of the Registrants' operating cash flows are provided by their electric and natural gas utilities, which are significantly influenced by factors such as weather, regulatory mechanisms, economic conditions, changes in working capital and operating costs.

(PPL)

PPL's cash provided by operating activities in 2026 increased $25 million compared with 2025.

•Net income increased $85 million between the periods and included an increase in non-cash components of $96 million. The increase in non-cash components was primarily due to an increase in depreciation.

•The $115 million decrease in cash from changes in working capital was primarily due to a decrease in current regulatory liabilities and taxes payable and an increase in fuel, materials and supplies, partially offset by a decrease in accounts receivable and unbilled revenues.

•The $41 million decrease in cash from other operating activities was primarily due to an increase in other noncurrent assets.

PPL Electric's cash provided by operating activities in 2026 decreased $45 million compared with 2025.

•Net income decreased $7 million between the periods and included an increase in non-cash components of $22 million. The increase in non-cash components was primarily due to an increase in depreciation.

•The $77 million decrease in cash from changes in working capital was primarily due to a decrease in accounts payable and taxes payable and an increase in accounts receivable and materials and supplies, partially offset by a decrease in unbilled revenues.

•The $17 million increase in cash provided by other operating activities was driven primarily by a decrease in noncurrent regulatory assets.

(LG&E)

LG&E's cash provided by operating activities in 2026 decreased $2 million compared with 2025.

•Net income increased $31 million between the periods.

•The $65 million decrease in cash from changes in working capital was primarily due to a decrease in accounts payable to affiliates and taxes payable and an increase in current regulatory assets.

•The $24 million increase in cash from other operating activities was primarily due to a decrease in other noncurrent assets.

(KU)

KU's cash provided by operating activities in 2026 decreased $18 million compared with 2025.

•Net income increased $20 million between the periods.

•The $36 million decrease in cash from changes in working capital was primarily due to a decrease in taxes payable and accounts payable to affiliates and an increase in fuel, materials and supplies, partially offset by an increase in accounts payable.

•The $5 million decrease in cash from other operating activities was primarily due to a decrease in other noncurrent liabilities.

Investing Activities

The components of the change in cash provided by (used in) investing activities for the six months ended June 30, 2026 compared with 2025 were as follows.

For PPL, the increase in expenditures for PP&E was due to an increase in project expenditures at PPL Electric, RIE, LG&E and KU. The increase in expenditures at PPL Electric was primarily due to increases in transmission and distribution projects. The increase in expenditures at LG&E was primarily due to the E.W. Brown battery storage project and Mill Creek Unit 5. The increase in expenditures at KU was primarily due to Mill Creek Unit 5.

For PPL Electric, the change in "Notes receivable from affiliate" is due to additional lending and fewer payments received from affiliates. For LG&E, the change is due to additional payments received from an affiliate. See Note 11 to the Financial Statements for further discussion of intercompany borrowings.

Financing Activities

PPL regularly analyzes and evaluates its capital structure and may explore potential transactions, including debt or equity purchases and/or exchanges from time to time through redemptions, open market purchases, private transactions, or otherwise, or seek to raise additional debt or equity capital, depending on market conditions.

The components of the change in cash provided by (used in) financing activities for the six months ended June 30, 2026 compared with 2025 were as follows.

See Note 7 to the Financial Statements in this Form 10-Q for information on 2026 short-term and long-term debt activity, equity transactions and PPL dividends. See Note 8 to the Financial Statements in the Registrants' 2025 Form 10-K for information on 2025 activity.

Credit Facilities

The Registrants maintain credit facilities to enhance liquidity, provide credit support and provide a backstop to commercial paper programs. Amounts borrowed under these credit facilities are reflected in "Short-term debt" on the Balance Sheets. At June 30, 2026, the total committed borrowing capacity under credit facilities and the borrowings under these facilities were:

External

(b)Includes a $1.5 billion syndicated credit facility with a $400 million borrowing sublimit for RIE and a $1.1 billion sublimit for PPL Capital Funding. RIE's borrowing sublimit is adjustable, at the borrowers' option, from $0 to $600 million, with the remaining balance of the $1.5 billion available under the facility allocated to PPL Capital Funding. At June 30, 2026, PPL Capital Funding and RIE had no commercial paper outstanding. RIE's obligations under the facility are not guaranteed by PPL.

(c)The commitments under the credit facilities are provided by a diverse bank group, with no one bank and its affiliates providing an aggregate commitment of more than the following percentages of the total committed capacity: PPL - 8%, PPL Electric - 7%, LG&E - 7% and KU - 7%.

See Note 7 to the Financial Statements for further discussion of the Registrants' credit facilities.

Intercompany (LG&E and KU)

(a)LG&E and KU participate in an intercompany money pool agreement whereby LKE and/or KU make available to LG&E, and LKE and/or LG&E make available to KU funds up to the difference between LG&E's and KU's FERC borrowing limit and LG&E's and KU's commercial paper issued, at an interest rate based on the lower of a market index of commercial paper issues and two additional rate options based on SOFR.

See Note 11 to the Financial Statements for further discussion of intercompany credit facilities.

Commercial Paper (All Registrants)

The Registrants, and PPL Capital Funding and RIE, maintain commercial paper programs to provide an additional financing source to fund short-term liquidity needs, as necessary. Commercial paper issuances, included in "Short-term debt" on the Balance Sheets, are supported by the respective Registrant's credit facility, with PPL Capital Funding and RIE's issuances supported by PPL Capital Funding's syndicated credit facility. The following commercial paper programs were in place at June 30, 2026:

(b)Issuances under the PPL Capital Funding and RIE commercial paper programs are supported by the PPL Capital Funding syndicated credit facility, which has a total capacity of $1.5 billion, currently with a $400 million borrowing sublimit for RIE and a $1.1 billion sublimit for PPL Capital Funding. PPL Capital Funding's Commercial paper program is also backed by a separate bilateral credit facility for $100 million.

Long-term Debt and Equity Security Activities

See Note 7 to the Financial Statements for information regarding the Registrants' long-term debt and equity security activities.

Common Stock Dividends

In May 2026, PPL declared a quarterly common stock dividend, payable July 1, 2026, of 28.50 cents per share. Future dividends, declared at the discretion of the Board of Directors, will depend upon future earnings, cash flows, financial and legal requirements and other factors.

Rating Agency Actions

Moody's and S&P periodically review the credit ratings of the debt of the Registrants and their subsidiaries. Based on their respective independent reviews, the rating agencies may make certain ratings revisions or ratings affirmations.

A credit rating reflects an assessment by the rating agency of the creditworthiness associated with an issuer and particular securities that it issues. The credit ratings of the Registrants and their subsidiaries are based on information provided by the Registrants and other sources. The ratings of Moody's and S&P are not a recommendation to buy, sell or hold any securities of the Registrants or their subsidiaries. Such ratings may be subject to revisions or withdrawal by the agencies at any time and should be evaluated independently of each other and any other rating that may be assigned to the securities.

The credit ratings of the Registrants and their subsidiaries affect their liquidity, access to capital markets and cost of borrowing under their credit facilities. A downgrade in the Registrants' or their subsidiaries' credit ratings could result in higher borrowing costs and reduced access to capital markets. The Registrants and their subsidiaries have no credit rating triggers that would result in the reduction of access to capital markets or the acceleration of maturity dates of outstanding debt.

The rating agencies have taken the following actions related to the Registrants and their subsidiaries:

(PPL)

In May 2026, Moody's revised its outlook to negative for PPL, PPL Capital Funding and RIE.

Ratings Triggers

Various derivative and non-derivative contracts, including contracts for the sale and purchase of electricity and fuel, commodity transportation and storage, and interest rate instruments, contain provisions that require the posting of additional collateral or permit the counterparty to terminate the contract, if PPL's, LG&E's or KU's or their subsidiaries' credit rating, as applicable, were to fall below investment grade. See Note 14 to the Financial Statements for a discussion of "Credit Risk-Related Contingent Features," including a discussion of the potential additional collateral requirements for derivative contracts in a net liability position at June 30, 2026.

For additional information on the Registrants' liquidity and capital resources, see "Item 7. Combined Management's Discussion and Analysis of Financial Condition and Results of Operations," in the Registrants' 2025 Form 10-K.