Joseph P. Bergstein, Jr. - PPL Corp. William H. Spence - PPL Corp. Vincent Sorgi - PPL Corp. Gregory N. Dudkin - PPL Electric Utilities Corporation Victor A. Staffieri - Kentucky Utilities Co. Robert A. Symons - PPL UK Distribution Holdings Ltd..

Greg Gordon - Evercore ISI Julien Dumoulin-Smith - UBS Securities LLC Steve Fleishman - Wolfe Research LLC Jonathan Philip Arnold - Deutsche Bank Securities, Inc. Paul T. Ridzon - KeyBanc Capital Markets, Inc. Paul Patterson - Glenrock Associates LLC Brian L. Chan - Merrill Lynch, Pierce, Fenner & Smith, Inc..

Good morning, and welcome to the PPL Corporation's Fourth Quarter 2016 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. Please go ahead..

Thank you. Good morning, everyone, and thank you for joining the PPL conference call on fourth quarter and year-end 2016 results, as well as our general business outlook. We are providing slides of 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 provision of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from such forward-looking statements.

A discussion of 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, a non-GAAP measure, 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 furnished with the SEC. At this time, I'd like to turn the call over to Bill Spence, PPL Chairman, President and CEO..

higher gross margins from additional capital investments in Kentucky; increased transmission spending in Pennsylvania, partially offset by higher depreciation and interest; and the dilution from the equity issuances I just mentioned. Domestic net income is expected to grow 5% to 7% over the forecast period.

Meanwhile, we're expecting UK earnings growth of 6% to 8%, reflecting the hedges we've put in place and our ability to achieve our $1.30 per pound budgeted rate through 2020.

In addition to effects of currency, the growth in our UK segment is driven by higher gross margins, driven by annual price increases and higher pension income due to higher returns on higher pension asset balances, which more than offsets the effects of any dilution.

We continue managing our currency risk proactively, taking steps to improve the risk reward profile and the certainty we will achieve our growth objectives. We can meet 5% EPS growth through 2020, even if the pound drops to $1.13 per pound, and we can meet that growth through 2019 at $0.90 per pound.

This is a very significant improvement in our risk reward profile. Vince will provide a detailed update on our foreign currency hedging in his remarks. We're expecting net income for the UK segment to now grow in the 8% to 10% range for the forecast period.

Overall, we feel very confident in our ability to deliver on our projected 5% to 6% compound annual earnings growth from 2017 through 2020. Further, we expect to achieve a very competitive total annual share on the return of 9% to 10%, as we execute our plans for growth. Let's turn to slide 10.

We know the investment community has a keen interest in the topic of U.S. tax reform, including how any changes may impact PPL and other utilities.

For PPL, the two primary effects we're tracking are the deductibility of interest expense on our domestic holding company debt and the net effect on rate base at our utilities from the extension of 100% bonus depreciation, offset of course by our tax rate. I want to highlight two very important points that differentiates PPL from its peers.

First, since about half of our business resides in the UK, we have minimal exposure to tax reform for half of our earnings. Second, we have the flexibility to raise capital in the UK, thereby retaining the ability to deduct interest. We support efforts to simplify the U.S.

tax code and to lower the federal corporate tax rate to a level that is more competitive globally. But speculating on the impact of tax reform is extremely difficult, given the lack of detail on current proposals that have been set forth today.

Our industry has a good track record of working with policy makers to shape meaningful tax-related legislation that minimizes negative impacts to our customers and to our companies. This was true during the last comprehensive tax reform in 1986, as well as during the debate on – later on taxes related to dividends and capital gains.

Our base assumption is that any benefits from the reduction of the tax rate will be passed through to our customers. Therefore, the only real impact on our utilities is the impact on rate base. As we think about tax reform, it's important to keep in mind that we have several opportunities, in PPL's case, to offset potential impacts.

We can use the dry powder created by our hedging strategy, we could shift some of holding company debt financings to the UK, and we have the ability to increase capital spending. Of course, the details of any tax reform plan are very hard to predict at this point. But to help frame this up for PPL, I wanted to address a few possible scenarios.

First, as it relates to rate base at our domestic utilities, if we're required to adapt 100% expensing of capital, our breakeven tax rate for rate base would be about 20%.

Regarding deductibility of interest, if the tax rate is reduced to 20% and we retain the ability to deduct interest to expense on all debt or if non-deductibility of interest is only applied to new debt, we would see about a $0.05 per share impact to earnings which we believe we can fully mitigate with the strategies I just talked about.

If non-deductibility of interest applies to all existing debt, we would see about a $0.10 per share impact to earnings, which we also believe we can largely mitigate through these strategies, especially if the pound stays around $1.20 or above as it is today. I'm confident that U.S.

tax reform, as it's currently being discussed, is a manageable event for PPL and not a barrier in our ability to meet our stated goal of growing EPS by 5% to 6% through 2020. At this time, I'll turn the call over to Vince, for a more detailed look at our earnings.

Vince?.

Thank you, Bill, and good morning, everyone. Let's move to slide 12, for a review of segment earnings. Full year 2016 earnings from ongoing operations increased over the prior year, from 2015 earnings of $2.21 per share to $2.45 per share, exceeding the midpoint of our 2016 earnings guidance by $0.07, placing us at the high end of the forecast range.

Each of our operating segments delivered strong growth compared to the prior year. The Pennsylvania Regulated segment contributed $0.13 of growth for the year, the Kentucky Regulated segment contributed $0.07, and the UK Regulated segment contributed $0.05. Corporate and Other remained relatively flat compared to the prior year.

Before I get into the segment details, let's briefly discuss the impact weather had on our results for the full year. Weather really did not have a significant impact on our 2016 earnings performance, as it was flat compared to 2015 and it was $0.01 worse than budget.

Let's move to a more detailed review of the 2016 segment earnings drivers, starting with the Pennsylvania results on slide 13. Our Pennsylvania Regulated segment earned $0.50 per share in 2016, a $0.13 increase compared to 2015.

This increase was due to higher gross margins as a result of higher distribution base electricity rates effective January 1, 2016, and higher transmission margins from additional capital investments. Higher margins were partially offset by higher depreciation due to asset additions.

Moving to slide 14, our Kentucky Regulated segment earned $0.58 per share in 2016, a $0.07 increase from 2015.

This increase was due to higher gross margins, which is the net effect of electricity and gas base rate increases effective July 1, 2015, and returns on additional environmental capital investments, and lower operation and maintenance expense including the reduction of costs associated with the 2015 coal plant retirement.

These net positive results were partially offset by higher financing costs related to the September 2015 debt issuances. Moving to slide 15, our UK Regulated segment earned $1.49 per share in 2016, a $0.05 improvement compared to 2015.

Positive factors driving earnings results include higher gross margins, primarily driven by an April 1, 2016 price increase, partially offset by four months of lower prices from the April 1, 2015 price decrease, a decrease in O&M primarily from lower pension expense and lower U.S.

income taxes primarily from the benefit recorded in Q4 2016 for the expected utilization of foreign tax credit, resulting from our updated business plan.

These positive factors were partially offset by increased depreciation expense from asset additions, higher financing costs due to 2015 debt issuances, and lower average exchange rates in 2016 compared to 2015. The average rate for 2016 was $1.45 per pound compared to $1.57 per pound for 2015.

Moving to slide 16, we've updated our hedging disclosures and made great progress in de-risking our plan related to foreign currency exposure. The chart at the top of the page highlights our contractual hedge level. And as you can see, we started to layer in hedges for 2019 with 50% already hedged.

As Bill mentioned, embedded in the midpoint of our 2017 earnings forecast of $2.15 per share, is about $0.05 of hedge restrikes. We achieved 50% hedge level for 2019 as of today by executing four of the $0.05 of planned restrikes, as well as entering into forward contracts for 2019, at rates that were near our budgeted rate of $1.30.

As you can see on the slide, the average rate for the 2019 hedges is $1.34 per pound compared to our budgeted rate of $1.30. It's important to note that we achieved this 50% hedge level above our budgeted rate without reducing the hedge levels for 2018.

2018 is still hedged at an average rate of $1.42 per pound, well above our budgeted rate, enabling us to still restrike value from 2018 into 2019 and 2020. To the strength of our business plan and with the hedges in place for half of 2019, we continue to de-risk 2019 and 2020 as illustrated in the lower table.

This table lays out our ability to hedge 2017 through 2020 at various GBP rates to maintain at least the low end of our earnings growth range of 5% to 6%. Effectively, we have no exposure through 2019.

The pound could fall as low as $0.90 per pound, and we could still achieve a 5% EPS growth rate through 2019; and at $1.13 per pound, we can achieve that growth through 2020.

The additional hedging we have done significantly mitigates our foreign currency exposure related to our UK operations, and we believe we have skewed that exposure to the upside with the actions we've taken to-date.

I should also note that tax reform will likely improve this picture even further, since we gross up our hedges to cover the current 35% tax rate. If the tax rate is lowered to 20%, we would be 100% hedged for 2018 and about 70% hedged for 2019.

Also, the sensitivities in the bottom table would improve for 2020 as well, with the breakeven rate going from $1.13 per pound down to $1.07. Moving to slide 17, our planned capital expenditures for 2017 through 2021 are detailed on this slide, with infrastructure investment totaling $16 billion over the period.

We continue to invest about $1 billion annually in each of our business lines, which includes our previously-announced initiatives, as well as $1 billion of incremental capital identified for 2017 through 2020 compared to the prior plan.

As Bill mentioned earlier, our investments focus on delivering a sustainable energy future by expanding and modernizing the grid, adding smart grid technology and automation, and strengthening physical and cyber security. We are also connecting more renewable energy and expanding solar offerings to our customers.

In Kentucky, we are investing an additional $525 million over the next four years, despite lower environmental spending of $345 million due to updated scope and timing changes for ELGs and CCR projects.

This additional capital includes $320 million to install advanced meters and $550 million to improve the reliability of electric and gas infrastructure in Kentucky.

In Pennsylvania, we are investing an additional $310 million in transmission, driven primarily by increased or accelerated project activity, such as line rebuilds, new substations and security. Distribution spending levels in Pennsylvania remain relatively flat.

We currently project our capital investment to decrease slightly in the outer years, as our advanced metering projects are completed in both Pennsylvania and Kentucky and our environmental spend in Kentucky ramps down.

Consistent with last year's plan, our capital plan is based on identified projects only across the portfolio, and it does not include unidentified growth projects. However, we continually find new capital projects in support of reliability, safety and security. We have a robust pipeline of capital projects.

And I believe, as we continue to work on the system and develop our future plans including responding to tax reform, we will identify additional capital spend for the back end of the plan. Moving to slide 18, here we're providing an update to our view of domestic cash flows, reflecting 2016 actual results and providing the 2017 projection.

2016's excess cash position of $702 million includes the $310 million of net proceeds received last year from the monetization of the 2017 and 2018 earnings hedges following the Brexit referendum.

Cash available for distribution is expected to be lower in 2017 compared to 2016, primarily due to lower cash inflows from our currency hedges, higher domestic maintenance capital as we continue to invest in the utilities, and the lower dividend coming from the UK.

Overall, though, we still expect cash available for distribution to be either breakeven or positive over the forecast period, even assuming the dividend grows at 4% per year. And finally, turning to slide 19, we show our updated RPI forecast assumptions using the January 2017 HM Treasury forecast of the UK economy.

Our business plan assumptions are in line with these current RPI forecasts. Our sensitivity for a 0.5% movement in 2016-2017 RPI, now results in a $0.01 impact out in 2019. As a reminder, this past November, we set our 2018-2019 tariffs based on the forecasted RPI at that time and that is consistent with Ofgem's guidance.

That concludes my prepared remarks. I'll turn the call over to Bill for the Q&A.

Bill?.

Thank you, Vince. 2016 was a very good year and I'm proud of PPL's many accomplishments in 2016. And I'm equally excited about our future, as we continue and advance a smarter, cleaner, and more reliable energy infrastructure. At the outset of the year, we established our earnings forecast.

In the end, we delivered, achieving the high end of that forecast range. As 2016 began, we said we would begin to grow our dividend more meaningfully in 2017. Today, we have delivered, announcing a 4% dividend increase. We established also a plan to invest more than $3 billion in infrastructure improvements in 2016. Again, we delivered.

It's what we do, we deliver. And looking ahead, we are very well-positioned to continue to deliver on the commitments we've made to our shareowners and customers. PPL is uniquely advantaged with operations in the UK, with only half of our earnings subject to potential U.S.

tax reform, and our ability to optimize the capital structure relative to interest deductibility. And as Vince noted in his remarks, we believed we are now positively positioned with the company's exposure to the British pound, given our hedging activity to-date which could also be used to mitigate any potential negative impacts of U.S. tax reform.

On that note, I want to thank you for participating in today's call. And operator, let's open the call for questions, please..

Thank you. The first question comes from Greg Gordon at Evercore ISI..

Hey, good morning, guys. Fantastic quarter..

Good morning, Greg..

Thank you so much..

Yeah. Congratulations. A few questions and I'm going to admit, some of the stuff may have gone over my head a little bit, so I may be asking you to repeat yourselves.

But first on the – when I look at the earnings from operations for the year, obviously the biggest positive delta was in the UK, but you only increased your 2017 earnings guidance expectation by $0.01.

And I'm just wondering how much of the beat in 2016 was truly sort of just structurally improving on the base of earnings versus somewhat non-recurring? And are you being a bit conservative at the midpoint on the UK earnings for 2017?.

Sure. I'll ask Vince to comment, but just one point to note is what the increase in our equity issuance is that obviously is going to create some dilution which has a ripple effect across all the businesses of course. So, that's one driver.

But Vince, do you want to take care of the other drivers?.

Yeah. So I think the big holdback in 2017 is putting the restrikes into the plan. And so, we put a nickel of restrikes in the plan to basically continue to de-risk. And as I said, four of the $0.05 we've already executed on that..

Okay. I get it. I get it. So between a little equity dilution and restriking....

Yeah..

...those are two of the big components. Okay..

Those are the biggest..

Yeah..

Okay. And then, when we look at the current hedge profile, what you basically said, if I go to page 16 is that, if the U.S.

federal income tax rate went to 20%, your breakeven would go up, but it's still significantly lower than where the pound is trailing?.

Do you want to take that?.

Yeah. Sure. Go ahead, Vince..

No. So if the tax rate goes from 35% to 20%, the $1.13 which is our breakeven to get to a 100% hedged through 2020 on the slide, that would go to $1.07..

Oh, it goes the other way. See, I told you. That's why I wanted to ask. And then....

Just to clarify because I know we kind of went through that quickly, but the reason for that is the hedge levels would go up in the top part. So, the 87% goes to 100% and the 50% and 19% goes to 70%..

Okay..

So, we basically need – we need less dry powder to get the results we were getting in the plan..

Okay. Next question. I do understand that you have flexibility on where you can finance, you can issue debt in the UK, you can issue debt in the U.S., and that's obviously on a going-forward basis an advantage if deductibility changes.

But if the federal income tax rate goes from 35% to 20%, the tax yield on your current leverage would go down and that would be an earnings drag, then that's just algebra. So, is there some way that you could also just sort of retire debt in the U.S.

and issue debt in the UK in order to limit that negative arbitrage or not?.

Potentially, I mean, at 20% we're basically the same rate as in the UK as well, and that's $0.05 that Bill talked about. So the impact of maintaining deductibility, but going from 35% to 20% at $0.15 loss in tax yield is basically a nickel and we think we can manage that with the strategies Bill talked about..

Okay. Great. Thank you, guys..

Okay. Thanks, Greg..

The next question is from Julien Dumoulin-Smith at UBS..

Hey, good morning..

Good morning, Julien..

Good morning..

Hey, so maybe let me start right where Greg left off here. So can you discuss a little bit on repatriation strategy? Obviously, you guys have been talking about bringing that down a little bit in last quarters.

How do you think about repatriation changing your strategies, you've talked up to $0.5 billion at times? Would you expect to make use of that if there were to be a holiday or maybe comment on that first?.

Sure. I'll ask Vince to take that question..

Sure. So, a tax holiday really benefits those U.S. companies that are sitting on a pile of cash offshore. That's not our situation. As you know, we invest our cash into the business. And so, really the financing of the capital structure in the UK is what enables us to fuel that growth in the UK and then distribute some cash back to the U.S.

I wouldn't see us necessarily modifying that, but once the final rules come out for U.S. tax reform, we'll look at what the best economic answer is overall for the corporation, and then determine really where we want to finance.

We still have the ability to increase our financing in the UK and dividend more than, say, the 100% to 200% (32:04) that we have in the plan tax free. And so, we would certainly have the ability to do that, but really until the rules come out, I can't tell you how we're going to modify that..

Got it. And then maybe little bit of a higher level question vis-à-vis sort of appropriate capital structure.

How do you think about, should this tax reform take place, your debt pay down strategy, e.g., your kind of optimal capital, would you expect to target to pay down more or just kind of higher level observation, maybe frame it in the context in that further debt targets, would that shift around?.

I don't think our strategy would change much even in the face of tax reform. I think the capital deployment might get a little bit higher, again, depending on how the 100% expensing goes. But I think overall, the capital structure and the credit metrics that we currently are targeting would still be pretty much the same..

Yeah, Julien, I....

Got it..

Just to add to that, I think the $350 million that we put in the plan gives us some nice risk mitigant against any credit actions or credit impacts of tax reform. So I think that level that we have in the new plan should be sufficient under tax reform or not..

Got it.

And just to clarify, the acceleration of CapEx under tax reform, what would that principally be if you could comment on that, distribution in Kentucky?.

Would be probably more Pennsylvania distribution than Kentucky..

Got it. Excellent. Thank you, guys..

Thank you..

The next question is from Steve Fleishman at Wolfe Research..

Yeah. Hi. Good morning..

Good morning, Steve..

So, couple questions. Just on the UK pound, so the $1.13 now through 2020 for the kind of protection as to the 5%, the bottom of your range. I assume to get to the middle of your range, it would be maybe somewhere in the high $1.10s like or $1.20. Is it still like $0.01 per $0.01? Yeah..

Yeah. Yeah. Still roughly $0.01 for $0.01..

Okay..

So yeah, that's still probably – it would clearly be well below where the pound is today..

All right..

Yeah. So probably in the upper teens..

Yeah. So Steve, it's about $1.20, $1.21 to hit 6%. So it's in the middle there for midpoint..

Okay. Great. And then just on, god forbid, anyone ever thinks about the pound going up, could you just remind us environment where it goes above $1.30? Obviously, you'll do better on your open positions than you're assuming.

But just in thinking of the company as a whole, like, are your hedging kind of locked in or do you have room on your hedges to actually capture some of a higher pound?.

Yeah. So, there is room on some of the hedges. The more recent hedges we put on are straight swaps, so there's less flexibility there. But obviously, with the open position for the remainder of 2019 and 2020 now, that would be upside and then, of course, longer term as we see how Brexit turns out.

And hopefully, with the rising pound, we have the ability to lock in 2020 and beyond at higher than $1.30. I think we've talked on previous calls, the 20-year average prior to Brexit was above $1.50, so closer to $1.60. So, there's room to grow there and certainly exposure to the upside for us..

Okay. And then the lower growth rate at the U.S. obviously is the dilution.

The higher growth rate in the UK, you're offsetting the dilution with what?.

Go ahead, Vince..

Sure. Yeah. So, I think it was third quarter we talked about the property taxes coming way down from what we were originally expecting. We did not take credit for that, as you recall, on the third quarter because we wanted to wait till the plan was completed.

And so, there's really three main items that are driving the dry powder that we created to get to these much lower rates that you're seeing on slide 16. It's the property taxes. Pensions actually came in better than we were projecting.

If you recall back on the second quarter call when we rebased the earnings post-Brexit, we took a very conservative approach on pension, so they came in stronger than we expected. And then, through income tax planning, we're also seeing some improvement there. And so, that created about $0.10 in total of earnings.

Half of that went to increasing the growth rate of the UK and half of it went to create the dry powder that you're seeing on slide 16. So, maybe just to append to your earlier question on what happens if the pound goes up, well, if we don't need all that dry powder, I would suspect earnings would be up $0.05 a year going through the period..

Okay.

One last thing, any thoughts on Compass with respect to the Indian Point closure, and how that could potentially play into being one of the ways to solve that?.

Sure. I'll ask Greg Dudkin, President of our Pennsylvania Utility, to answer that question.

Greg?.

Yeah. Thanks, Bill. So, we actually are involved in something called CARA (38:05) study, which is a study that is done with the New York ISO to really determine the value of the project. So, our study was slowed down a little bit because of the Indian Point closure. Our expectation is that that will be a positive for Compass.

We expect that this CARA (38:24) study will be done in March, so we'll know the final results of that then..

Okay. Thank you..

Thanks, Steve..

The next question is from Jonathan Arnold at Deutsche Bank..

Hey, good morning, guys..

Good morning, Jonathan..

Could I just ask on the $0.05 and $0.10 numbers that you gave on tax, were they additive or is it $0.05 if you keep deductibility on past interest and $0.10 if you lose it or is it....

Got you, yeah..

Okay..

Correct, they are not additive. They're discrete numbers. So, it's....

Incremental $0.05..

...incremental $0.05. So, it would be max $0.10..

Great. Thank you..

You're welcome..

And then the second thing, can you give us a little more color on the reduction in the Kentucky environmental spend? What is it that you aren't going to be doing? Is it just a little less under certain rules, or are you assuming some things aren't required?.

Sure. I'll ask Vic Staffieri, the President and Chairman of our Kentucky Utilities, to answer that one..

I think it's a couple of things, Jonathan. The first is that now we've got into some more detailed engineering and we've been able to save some money for our consumers. We've gotten some indicative bids that has helped us. And as we've done it again, additional engineering, we've found other ways that are more cost-effective for our customers.

So, the rules haven't changed. The course of our compliance has changed, and actually that benefits our consumers..

Okay. Great.

And then maybe, I could, just one other thing on the incremental spend that you've put in that's – how much of that is approved and what's the mechanism for getting it approved?.

For the most part, those are in our rate case right now. The additional capital runs over a long period of time and we're in the process of seeking commission authority (40:30) right now in our rate case. That's within our testimony today..

Okay. Great. Thank you very much..

Thank you..

The next question is from Paul Ridzon at KeyBanc..

Good morning..

Good morning, Paul..

You had a big O&M cut over in the UK, how sustainable is that going into 2017 and beyond? Will that stop gap or is that – reliability would be a risk if you kept at that level?.

Sure. I don't think reliability would be at risk at all, but I'll let Robert Symons, the CEO of our UK operation answer that question..

I don't think it will have any effect on reliability. From my point of view, we've put in about 2,000 separate schemes (41:20), improving reliability over the last 12 months and we'll continue to do so..

So, do you think 2017 could be flat O&M in the UK?.

Relative to 2016?.

Yes, sorry..

Paul, unfortunately I don't have that detail in front of us. I mean, part of what's contributing to 2016 is lower pension from the methodology change that we enacted late in, I guess 2015 going into 2016.

And so that in addition to just higher returns, we earned on average about 15% returns last year in the UK on our pension assets, which that carrying forward helps. And so, not reliability driven at all, it's more related to pension and it is sustainable..

So, what percentage is pension versus rentals..

That's a good question. I'm not sure that we have that right off the top of our heads. So, we'll have to follow up with you on that. Sorry..

Sounds good. Thank you very much..

Okay. You're welcome..

The next question is from Paul Patterson at Glenrock Associates..

Good morning..

Good morning..

Just one question left for me. You guys mentioned the ability to issue debt in the UK versus the U.S. as a way of dealing with the potential tax changes.

What is the sort of the – quantifiably, how much could be done there if, in fact, it was advantageous to do that?.

Sure. So I'll start and I'll let Vince follow up. But as you may recall, with the UK holding company we can lever up to 85% and still maintain investment grade credit ratings. So that's the kind of upper limit. We're right now in the kind of mid-to-upper 70%, so we have that level of headroom to go up to 85%.

So, I don't know if you had any other comments, Vince..

Yeah. So that's worth over $1 billion by time we get through the end of the plan period. In terms of – I think we hang at around 80% and we could go up to 85%. So, by time we get out to 2020, again, that's worth about $1 billion-plus. I would say, as we kind of look at tax reform, we have to see how much on any annual basis we could shift it.

I would think at least $150 million would be no problem and it could probably go back up to $400 million that we had originally. But again, that's all going to depend on how those final rules come out, but somewhere in that range, I would say..

Okay. That's all I have left. Thanks a lot..

Great. Thank you, Paul..

Our next question is from Brian Chan at Bank of America Merrill Lynch..

My question was asked and answered. Thank you..

Okay. Great, Brian. Thank you..

Okay, operator, I think that's all the questions in the queue. So, I'm just going to close now and say thanks everyone for joining us today, and we look forward to talking to you in a couple of months on our first quarter earnings call. Thank you..

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