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PENNSYLVANIA P&L $500 MILLION FIRST MORTGAGE BONDS RATED 'A' BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, Jan. 15 /PRNewswire/ -- Pennsylvania Power & Light Co.'s (NYSE: PPL) (PP&L) $500 million shelf registration of first mortgage bonds is rated 'A' by Fitch. When added to the $200 million from an existing shelf, the company has authorization to issue $700 million of first mortgage bonds. Ratings on the company's outstanding securities are affirmed as follows: $2.3 billion 'A' first mortgage bonds and $188 million 'A' secured pollution control bonds, $355 million 'A-' preferred stock, and $115 million 'BBB+' preference stock. Commercial paper is affirmed at 'F-1'. The credit trend is stable.
 Due to strong cash flow, moderate capital requirements, and refinancing opportunities, bondholder protection measures have improved steadily since 1985 and are solidly in the 'A' range. Fitch anticipates these measures to be relatively stable. The ability to control costs, however, will be critical in meeting the company's corporate goal of not raising rates before 1994-1995 at the earliest.
 Capital requirements over the next several years are rising, due in part to Clean Air Act-related expenditures, but remain manageable since PP&L has no need for additional generating capacity. Cash flow is estimated to provide about 75 percent-80 percent of expenditures over the next three years compared to well over 100 percent the past four years. Moderate sales growth, cost control measures including a reduction in employees to 7,500 from 7,900 essentially through attrition by 1995, and additional refinancings are expected to keep earnings protection measures and capital ratios relatively constant.
 For the 12 months ended September 30, pretax interest coverage (including interest on lease obligations) was 3.14 times(x) compared to 3.06x in 1991. The capital structure included 51.1 percent debt, 39.5 percent common equity and 9.4 percent preferred and preference stock. Internal cash generation provided 97.5 percent of capital expenditures. Based on PP&L's financing plans total debt (including capital lease obligations) should rise moderately to about 52 percent over the next two years and common equity to about 40 percent. Interest coverage is expected to remain in the 3.0x range.
 Pennsylvania Power & Light Co. provides electric service to 1.2 million customers in central eastern Pennsylvania. Headquarters are in Allentown, Pa.
 -0- 1/15/93
 /CONTACT: Robert Hornick, 212-908-0564, of Fitch/
 (PPL)


CO: Pennsylvania Power & Light Co. ST: Pennsylvania IN: UTI SU: RTG

LR -- NY030 -- 5288 01/15/93 10:44 EST
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Publication:PR Newswire
Date:Jan 15, 1993
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