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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

____________________________________________

FORM 10-Q

~~(x)~~☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

~~SECURITIES~~For ~~EXCHANGE~~the ~~ACT~~Quarterly OFPeriod ~~1934~~Ended June 30, 2025

~~For the quarterly period ended June 30, 2016~~-OR-

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

~~( )~~Commission ~~TRANSITION~~File ~~REPORT~~Number ~~PURSUANT TO SECTION 13 OR 15(d) OF~~1-2385

THE ~~SECURITIES~~DAYTON ~~EXCHANGE~~POWER ~~ACT~~AND OFLIGHT ~~1934~~COMPANY

~~For~~(Exact ~~the~~name ~~transition~~of ~~period~~registrant ~~from~~as ~~____________~~specified toin ~~____________~~its charter)

CommissionFile Number	Registrant, State of Incorporation,Address and Telephone Number	I.R.S. Employer Identification No.
1-9052	DPL INC.	31-1163136
	(An Ohio Corporation)
	1065 Woodman DriveDayton, Ohio 45432
	937-259-7215
1-2385	THE DAYTON POWER AND LIGHT COMPANY	31-0258470
	(An Ohio Corporation)
	1065 Woodman DriveDayton, Ohio 45432
	937-259-7215

d/b/a AES Ohio


Ohio			31-0258470
(State or other jurisdiction of incorporation or organization)			(I.R.S. Employer Identification No.)
1065 Woodman Drive
Dayton, Ohio			45432
(Address of principal executive offices)			(Zip Code)
Registrant's telephone number, including area code:			(937) 259-7215


Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
N/A	N/A	N/A

Indicate by check mark whether each registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

~~DPL Inc.~~ Yes o☐ No ~~x The Dayton Power and Light Company Yes o No x~~☒

~~Each of DPL Inc. and~~ The Dayton Power and Light Company is a voluntary filer. ~~that~~The Dayton Power and Light Company has filed all applicable reports under Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months.

Indicate by check mark whether each registrant has submitted electronically ~~and posted on its corporate Web site, if any,~~ every Interactive Data File required to be submitted ~~and posted~~ pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit ~~and post~~ such files).

~~DPL Inc.~~ Yes x☒ No ~~o The Dayton Power and Light Company Yes x No o~~☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”, ~~and~~ “smaller reporting company” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

~~Largeacceleratedfiler~~LargeacceleratedFiler ~~Acceleratedfiler~~AcceleratedFiler Non-~~acceleratedfiler~~accelerated Filer Smallerreportingcompany ~~DPL~~Emerging ~~Inc.~~growth ocompany o☐ x☐ o☒ ~~The~~☐ ~~Dayton Power and Light Company o o x o~~☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether each registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

~~DPL Inc.~~ Yes o☐ No ~~x The Dayton Power and Light Company Yes o No x~~☒

All of the outstanding common stock of ~~DPL Inc. is indirectly owned by~~ The ~~AES Corporation. All of the common stock of The~~ Dayton Power and Light Company is owned by ~~DPL~~AES Ohio Holdings, Inc.

As of August 41, ~~2016~~2025, ~~each~~The ~~registrant~~Dayton Power & Light Company had the following shares of common stock outstanding:

Registrant	Description	Shares Outstanding
Description			Shares Outstanding
DPL Inc.	Common Stock, no par value	1
Common Stock, $0.01 par value			41,172,173
The Dayton Power and Light Company	Common Stock, $0.01 par value	41,172,173

This combined Form 10-Q is separately filed by DPL Inc. and The Dayton Power and Light Company. Information contained herein relating to any individual registrant is filed by such registrant on its own behalf. Each registrant makes no representation as to information relating to a registrant other than itself.

~~DPL~~AES ~~Inc. and The Dayton Power and Light Company~~Ohio

~~Table~~Form of10-Q ~~Contents~~for the Quarterly Period ended June 30, 2025

Quarterly Report on Form 10-Q


		Table of Contents	Page No.
GLOSSARY OF TERMS			4
FORWARD–LOOKING STATEMENTS			6
PART I: FINANCIAL INFORMATION
	ITEM 1	FINANCIAL STATEMENTS
		AES Ohio
		Condensed Statements of Operations	10
		Condensed Statements of Comprehensive Income	11
		Condensed Balance Sheets	12
		Condensed Statements of Cash Flows	13
		Condensed Statements of Shareholder's Equity	14
		Notes to Unaudited Condensed Financial Statements	15
		Note 1 . Overview and Summary of Significant Accounting Policies	15
		Note 2 . Regulatory Matters	18
		Note 3 . Fair Value	19
		Note 4 . Debt	21
		Note 5 . Income Taxes	22
		Note 6 . Benefit Plans	22
		Note 7 . Shareholder's Equity	23
		Note 8 . Commitments and Contingencies	23
		Note 9 . Business Segments	24
		Note 10 . Revenue	24


	ITEM 2	MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	26
		Executive Summary	26
		Results of Operations	28
		Key Trends and Uncertainties	32
		Capital Resources and Liquidity	37
		Critical Accounting Policies and Estimates	40
	ITEM 3	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	40
	ITEM 4	CONTROLS AND PROCEDURES	40

PART II: OTHER INFORMATION
	ITEM 1	LEGAL PROCEEDINGS	41
	ITEM 1A	RISK FACTORS	41
	ITEM 2	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	41
	ITEM 3	DEFAULTS UPON SENIOR SECURITIES	41
	ITEM 4	MINE SAFETY DISCLOSURES	41
	ITEM 5	OTHER INFORMATION	41
	ITEM 6	EXHIBITS	42
SIGNATURES			43

Quarter Ended June 30, 2016

		Page No.
Glossary of Terms		5
Forward-Looking Statements		7
Part I Financial Information
Item 1	Financial Statements – DPL Inc. and The Dayton Power and Light Company (Unaudited)
	DPL Inc.
	Condensed Consolidated Statements of Operations	10
	Condensed Consolidated Statements of Comprehensive Income / (Loss)	11
	Condensed Consolidated Balance Sheets	12
	Condensed Consolidated Statements of Cash Flows	13
	Notes to Condensed Consolidated Financial Statements	14
	The Dayton Power and Light Company
	Condensed Statements of Operations	39
	Condensed Statements of Comprehensive Income / (Loss)	40
	Condensed Balance Sheets	41
	Condensed Statements of Cash Flows	42
	Notes to Condensed Financial Statements	43
Item 2	Management’s Discussion and Analysis of Financial Condition and Operations	62
	Electric Sales and Customers	87
Item 3	Quantitative and Qualitative Disclosures about Market Risk	87
Item 4	Controls and Procedures	87

DPL Inc. and The Dayton Power and Light Company

Table of Contents (cont.)

Quarterly Report on Form 10-Q

Quarter Ended June 30, 2016

		Page No.
Part II Other Information
Item 1	Legal Proceedings	88
Item 1A	Risk Factors	88
Item 2	Unregistered Sales of Equity Securities and Use of Proceeds	88
Item 3	Defaults Upon Senior Securities	89
Item 4	Mine Safety Disclosures	89
Item 5	Other Information	89
Item 6	Exhibits	90
Other
	Signatures	91

Table of Contents

AES Ohio

Form 10-Q for the Quarterly Period ended June 30, 2025

GLOSSARY OF TERMS

The following select terms, abbreviations or acronyms are used in this Form 10-Q:

Term	~~Definition~~	Definition
AES	~~The AES Corporation, a global power company and the ultimate parent company of DPL~~	The AES Corporation - a global power company and the ultimate parent company of DPL
AES Ohio Generation	AES Ohio Generation, LLC, a wholly-owned subsidiary of DPL that owns and operates peaking generation facilities from which it makes wholesale sales
AES Ohio		The Dayton Power and Light Company, which does business as AES Ohio
AOCI	Accumulated Other Comprehensive Income
AES Ohio Credit Agreement		$350.0 million AES Ohio Amended and Restated Credit Agreement, dated as of March 25, 2025
ARO	Asset Retirement Obligation
AES Ohio Term Loan		AES Ohio's unsecured $150.0 million term loan agreement which matures on October 13, 2025, and bears interest at variable rates
ASU	Accounting Standards Update
AFUDC		Allowance for Funds Used During Construction
CAA	U.S. Clean Air Act
AOCI		Accumulated Other Comprehensive Income
Capacity Market	The purpose of the capacity market is to enable PJM to obtain sufficient resources to reliably meet the needs of electric customers within the PJM footprint. PJM procures capacity, through a multi-auction structure, on behalf of the load serving entities to satisfy the load obligations. There are four auctions held for each Delivery Year (running from June 1 through May 31). The Base Residual Auction is held three years in advance of the Delivery Year and there is one Incremental Auction held in each of the subsequent three years. DP&L’s capacity is located in the “rest of” RTO area of PJM.
AOCL		Accumulated Other Comprehensive Loss
CP	In 2015, PJM adopted changes to the capacity market known as “Capacity Performance”. The CP program offers the potential for higher capacity revenues, combined with substantially increased penalties for non-performance or under-performance during certain periods identified as “capacity performance hours.” The DP&L units operate under the CP construct effective June 1, 2016.
ASC		Accounting Standards Codification
CRES	Competitive Retail Electric Service
ASU		Accounting Standards Update
D.C. Circuit Court	United States Court of Appeals for the District of Columbia Circuit
CAA		U.S. Clean Air Act - the congressional act that directs the EPA’s regulation of stationary and mobile sources of air pollution to protect air quality and stratospheric ozone
DPL	DPL Inc.
CCR		Coal Combustion Residuals - which consists of bottom ash, fly ash, boiler slag and flue gas desulfurization materials generated from burning coal
DPLER	DPL Energy Resources, Inc., formerly a wholly-owned subsidiary of DPL which sold competitive electric energy and other energy services. DPLER was sold by DPL on January 1, 2016. The DPLER sale agreement was signed on December 28, 2015.
CDPQ		Caisse de dépôt et placement du Québec
DP&L	The Dayton Power and Light Company, the principal subsidiary of DPL and a public utility that delivers electricity to residential, commercial, industrial and governmental customers in a 6,000 square mile area of West Central Ohio
CRES		Competitive Retail Electric Service
Dths	Decatherms, unit of heat energy equal to 10 therms. One therm is equal to 100,000 British Thermal Units
CWA		U.S. Clean Water Act
EBITDA	Earnings before interest, taxes, depreciation and amortization. EBITDA also excludes the Fixed-asset impairment
DIR		Distribution Investment Rider - established in the ESP 4 to recover certain distribution capital investments placed in service beginning June 30, 2020, for three years, and subject to increasing annual revenue limits and other terms. The annual revenue limit for 2024 is $38.4 million.
EGU	Electric generating unit
DPL		DPL LLC and its consolidated subsidiaries. On April 3, 2025, DPL Inc. converted its form of business organization from an Ohio corporation to an Ohio limited liability company (the "Conversion"). Upon the Conversion, DPL Inc. changed its name to DPL LLC.
ERISA	The Employee Retirement Income Security Act of 1974
DP&L		The Dayton Power and Light Company - the principal indirect subsidiary of DPL and a public utility that delivers electricity to residential, commercial, industrial and governmental customers in a 6,000-square mile area of West Central Ohio. DP&L does business as AES Ohio.
ESP	The Electric Security Plan is a cost-based plan that a utility may file with the PUCO to establish SSO rates pursuant to Ohio law
EPA		U.S. Environmental Protection Agency
ESP 1	ESP approved by PUCO order dated June 24, 2009
ESP		The Electric Security Plan - a plan that a utility must file with the PUCO to establish SSO rates pursuant to Ohio law
ESP 2	ESP approved by PUCO order dated September 4, 2013
ESP 4		DP&L's ESP filed September 26, 2022 which was approved by the PUCO in August 2023
ESP 3	ESP filed with the PUCO by DP&L on February 22, 2016
FASB		Financial Accounting Standards Board
FASC	Financial Accounting Standards Board (FASB) Accounting Standards Codification
Form 10-K		DPL’s and DP&L’s combined Annual Report on Form 10-K for the fiscal year ended December 31, 2024, which was filed on March 3, 2025
FERC	Federal Energy Regulatory Commission
First and Refunding Mortgage		DP&L’s First and Refunding Mortgage, dated October 1, 1935, as amended, with the Bank of New York Mellon as Trustee
Form 10-K	DPL’s and DP&L’s combined Annual Report on Form 10-K for the fiscal year ended December 31, 2015, which was filed on February 23, 2016
GAAP		Generally Accepted Accounting Principles in the United States of America
First and Refunding Mortgage	DP&L’s First and Refunding Mortgage, dated October 1, 1935, as amended, with the Bank of New York Mellon as Trustee
IRS		Internal Revenue Service
FTRs	Financial Transmission Rights
kWh		Kilowatt-hours - a measure of electrical energy equivalent to a power consumption of 1,000 watts for 1 hour
GAAP	Generally Accepted Accounting Principles in the United States of America
LGR		Legacy Generation Rider
Master Trust		DP&L established a Master Trust to hold assets that could be used for the benefit of employees participating in employee benefit plans
MATS		Mercury and Air Toxics Standards - the EPA’s rules for existing and new power plants under Section 112 of the CAA
MRO		Market Rate Option - a market-based plan that a utility may file with PUCO to establish SSO rates pursuant to Ohio law
NAAQS		National Ambient Air Quality Standards - the EPA’s health and environmental based standards for six specified pollutants, as found in the ambient air
NERC		North American Electric Reliability Corporation - a not-for-profit international regulatory authority whose mission is to assure the effective and efficient reduction of risks to the reliability and security of the electric grid
OAQDA		Ohio Air Quality Development Authority
OCC		The Office of the Ohio Consumers’ Counsel (OCC) is the statewide legal representative for Ohio’s residential consumers in matters related to their investor-owned electric, natural gas, telephone, and water services.
OVEC		Ohio Valley Electric Corporation - an electric generating company in which DP&L holds a 4.9% equity interest
Pension Plans		AES Ohio sponsors two defined benefit plans, The Dayton Power and Light Company Retirement Income Plan and The Dayton Power and Light Company Supplemental Executive Retirement Plan
PJM		PJM Interconnection, LLC, an RTO
PUCO		Public Utilities Commission of Ohio

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AES Ohio

Form 10-Q for the Quarterly Period ended June 30, 2025


Term			Definition
RSC			The Rate Stabilization Charge is a non-bypassable rider intended to compensate DP&L for providing stabilized rates to customers.
RTO			Regional Transmission Organization - an entity that is independent from all generation and power marketing interests and has exclusive responsibility for grid operations, short-term reliability, and transmission service within a region
SEC			U.S. Securities and Exchange Commission
SEET			Significantly Excessive Earnings Test - a test used by the PUCO to determine whether a utility's ESP or MRO produces significantly excessive earnings for the utility
Service Company			AES US Services, LLC - the shared services affiliate providing accounting, finance, and other support services to AES’ U.S. businesses

Smart Grid Phase 1			In June 2021, the PUCO approved the first phase of AES Ohio's grid modernization plan, covering four years of investment.

SSO			Standard Service Offer represents the regulated rates, authorized by the PUCO, charged to DP&L retail customers that take retail generation service from DP&L within DP&L’s service territory
T&D			Transmission and distribution
TCJA			The Tax Cuts and Jobs Act of 2017 signed on December 22, 2017
TCRR			Transmission Cost Recovery Rider
U.S.			United States of America
USD			U.S. dollar

Utility segment			Utility segment is made up of DP&L’s electric transmission and distribution businesses, which transmit and distribute electricity to residential, commercial, industrial and governmental customers

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GLOSSARY OF TERMS (cont.)
Term	Definition
GHG	Greenhouse Gas
kV	Kilovolt, 1,000 volts
kWh	Kilowatt-hours
LIBOR	London Inter-Bank Offering Rate
Master Trust	DP&L established a Master Trust to hold assets that could be used for the benefit of employees participating in employee benefit plans
Merger	The merger of DPL and Dolphin Sub, Inc., a wholly-owned subsidiary of AES. On November 28, 2011, DPL became a wholly-owned subsidiary of AES.
MTM	Mark to Market
MVIC	Miami Valley Insurance Company, a wholly-owned insurance subsidiary of DPL that provides insurance services to DPL and its subsidiaries and, in some cases, insurance services to partner companies related to jointly owned facilities operated by DP&L
MW	Megawatt
MWh	Megawatt-hour
NERC	North American Electric Reliability Corporation
NOx	Nitrogen Oxide
NYMEX	New York Mercantile Exchange
Ohio EPA	Ohio Environmental Protection Agency
OTC	Over-The-Counter
OVEC	Ohio Valley Electric Corporation, an electric generating company in which DP&L holds a 4.9% equity interest
PJM	PJM Interconnection, LLC, an RTO
PRP	Potentially Responsible Party
PUCO	Public Utilities Commission of Ohio
RPM	Reliability Pricing Model. The Reliability Pricing Model was PJM’s capacity construct
RTO	Regional Transmission Organization
SEC	Securities and Exchange Commission
SERP	Supplemental Executive Retirement Plan
Service Company	AES US Services, LLC, the shared services affiliate providing accounting, finance, and other support services to AES’ U.S. SBU businesses
SO2	Sulfur Dioxide
SSO	Standard Service Offer represents the regulated rates, authorized by the PUCO, charged to DP&L retail customers that take retail generation service from DP&L within DP&L’s service territory
USEPA	U.S. Environmental Protection Agency
USF	The Universal Service Fund is a statewide program which provides qualified low-income customers in Ohio with income-based bills and energy efficiency education programs
U.S. SBU	U. S. Strategic Business Unit, AES’ reporting unit covering the businesses in the United States, including DPL

AES Ohio

Form 10-Q for the Quarterly Period ended June 30, 2025

FORWARD–LOOKING STATEMENTS

Certain statements contained in this report are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Matters discussed in this report that relate to events or developments that are expected to occur in the future, including management’s expectations, strategic objectives, business prospects, anticipated economic performance and financial condition and other similar matters constitute forward-looking statements. Forward-looking statements are based on management’s beliefs, assumptions and expectations of future economic performance, considering the information currently available to management. These statements are not statements of historical fact and are typically identified by terms and phrases such as “anticipate,” “believe,” “intend,” “estimate,” “expect,” “continue,” “should,” “could,” “may,” “plan,” “project,” “predict,” “will” and similar expressions. Such forward-looking statements are subject to risks and uncertainties and investors are cautioned that outcomes and results may vary materially from those projected due to various factors beyond our control, including but not limited to:

•impacts of weather on retail sales;

•growth in our service territory and changes in demand and demographic patterns;

•weather-related damage to our electrical system;

•performance of our suppliers;

•transmission and distribution system reliability and capacity;

•regulatory actions and outcomes, including, but not limited to, the review and approval of our rates and charges by the PUCO;

•federal and state legislation and regulations;;

•changes in our credit ratings or the credit ratings of AES;

•fluctuations in the value of pension plan assets, fluctuations in pension plan expenses and our ability to fund defined benefit pension plans;

•changes in financial or regulatory accounting policies;

•environmental matters, including costs of compliance with, and liabilities related to, current and future environmental and climate change laws and requirements;

•interest rates and the use of interest rate hedges, inflation rates and other costs of capital;

•the availability of capital;

•level of creditworthiness of counterparties to contracts and transactions;

•labor strikes or other workforce factors, including the ability to attract and retain key personnel;

•facility or equipment maintenance, repairs and capital expenditures;

•significant delays or unanticipated cost increases associated with construction or other projects;

•the availability and cost of funds to finance working capital and capital needs, particularly during periods when the time lag between incurring costs and recovery is long and the costs are material;

•local economic conditions;

•costs and effects of legal and administrative proceedings, audits, settlements, investigations and claims and the ultimate disposition of litigation;

•industry restructuring, deregulation and competition;

•issues related to our participation in PJM, including the cost associated with membership, allocation of costs, costs associated with transmission expansion, the recovery of costs incurred and the risk of default of other PJM participants;

•changes in tax laws and the effects of our tax strategies;

•product development, technology changes and changes in prices of products and technologies;

•cyberattacks and information security breaches or information system failures;

•the use of derivative contracts;

•catastrophic events such as fires, explosions, terrorist acts, acts of war, pandemic events, or natural disasters such as floods, earthquakes, tornadoes, severe winds, ice or snowstorms, droughts, or other similar occurrences, including as a result of climate change; and

•the risks and other factors discussed in this report and other filings with the SEC.

Forward-looking statements speak only as of the date of the document in which they are made. We disclaim any obligation or undertaking to provide any updates or revisions to any forward-looking statement to reflect any change in our expectations or any change in events, conditions or circumstances on which the forward-looking statement is based. If we do update one or more forward-looking statements, no inference should be made that we will make additional updates with respect to those or other forward-looking statements.

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~~FORWARD-LOOKING~~AES ~~STATEMENTS~~Ohio

~~Certain~~Form ~~statements contained in this report are “forward~~10-~~looking~~Q ~~statements”~~for ~~within~~ the ~~meaning~~Quarterly ofPeriod ~~the~~ended ~~Private Securities Litigation Reform Act of 1995. Matters discussed in this report that relate to events or developments that are expected to occur in the future~~June 30, including management’s expectations, strategic objectives, business prospects, anticipated economic performance and financial condition and other similar matters constitute forward-looking statements. Forward-looking statements are based on management’s beliefs, assumptions and expectations of future economic performance, taking into account the information currently available to management. These statements are not statements of historical fact and are typically identified by terms and phrases such as “anticipate,” “believe,” “intend,” “estimate,” “expect,” “continue,” “should,” “could,” “may,” “plan,” “project,” “predict,” “will” and similar expressions. Such forward-looking statements are subject to risks and uncertainties and investors are cautioned that outcomes and results may vary materially from those projected due to various factors beyond our control, including but not limited to:2025

•All ~~abnormal~~of orthe ~~severe~~above ~~weather~~factors are difficult to predict, contain uncertainties that may materially affect actual results, and ~~catastrophic~~many ~~weather~~are beyond our control. See ITEM 1A. Risk Factors to Part I in our Annual Report on Form 10-~~related~~K ~~damage;~~and the Management's Discussion and Analysis of Financial Condition and Results of Operations section in our Form 10-K and in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 and this Quarterly Report on Form 10-Q for a more detailed discussion of the foregoing and certain other factors that could cause actual results to differ materially from those reflected in such forward-looking statements and that should be considered in evaluating our outlook. These risks may also be specifically described in our Quarterly Reports on Form 10-Q in PART II, ITEM 1A, Current Reports on Form 8-K and other documents that we may file from time to time with the SEC.

•SOURCES ~~unusual~~OF ~~maintenance~~OTHER ~~or repair requirements;~~INFORMATION

•We ~~changes~~encourage ininvestors, ~~fuel~~the ~~costs~~media, our customers and ~~purchased~~others ~~power,~~interested ~~coal~~in AES Ohio to review the information we post at www.aes-ohio.com. None of the information on our website is incorporated into, ~~environmental~~or ~~emission~~deemed ~~allowances~~to be a part of, ~~natural~~this ~~gas~~Quarterly ~~and~~Report on Form 10-Q or in any other ~~commodity~~report ~~prices;~~or document we file with the SEC, and any reference to our website is intended to be an inactive textual reference only.

•Our ~~volatility~~SEC ~~and~~filings ~~changes~~are inavailable ~~markets~~to ~~for~~the ~~electricity~~public ~~and~~from ~~other~~the ~~energy-related~~SEC’s ~~commodities;~~website at www.sec.gov.

• performance of our suppliers;

• increased competition and deregulation in the electric utility industry;

• increased competition in the retail generation market;

• availability and price of capacity;

• state, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, emission levels, rate structures or tax laws;

• changes in environmental laws and regulations to which DPL and its subsidiaries are subject;

• the development and operation of RTOs, including PJM to which DP&L has given control of its transmission functions;

• changes in our purchasing processes, pricing, delays, contractor and supplier performance and availability;

• significant delays associated with large construction projects;

• growth in our service territory and changes in demand and demographic patterns;

• changes in accounting rules and the effect of accounting pronouncements issued periodically by accounting standard-setting bodies;

• financial market conditions, changes in interest rates and changes in our credit ratings and availability and cost of capital;

• changes in tax laws and the effects of our strategies to reduce tax payments;

• the outcomes of litigation and regulatory investigations, proceedings or inquiries;

• general economic conditions; and

• the risks and other factors discussed in this report and other DPL and DP&L filings with the SEC.

All such factors are difficult to predict, contain uncertainties that may materially affect actual results and many are beyond our control. See Item 1A - Risk Factors in our Annual Report on Form 10-K for the fiscal year ended December 31, 2015 and the “Management’s Discussion and Analysis of Financial Condition and Results of

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~~Operations”~~AES section in such report and in our Quarterly Report on Form 10-Q for the three months ended March 31, 2016 and this Quarterly Report on Form 10-Q for a more detailed discussion of the foregoing and certain other factors that could cause actual results to differ materially from those reflected in such forward-looking statements and that should be considered in evaluating our outlook.Ohio

~~You~~Form ~~may read and copy any document we file at the SEC’s public reference room located at 100 F Street N.E., Washington, D.C. 20549, USA. Please call the SEC at (800) SEC~~10-~~0330~~Q for ~~further information on~~ the ~~public~~Quarterly ~~reference~~Period ~~room. Our~~ended ~~SEC~~June 30, ~~filings are also available to the public from the SEC’s website at www.sec.gov.~~2025

~~COMPANY~~PART ~~WEBSITES~~I: FINANCIAL INFORMATION

~~DPL’s~~This ~~public~~report ~~internet~~includes ~~site~~the isfiling ~~www.dplinc.com.~~ of DP&L’s. ~~public~~Throughout ~~internet~~this ~~site~~report, isthe ~~www.dpandl.com. The~~terms ~~information~~"the onCompany", ~~these~~“we,” ~~websites~~“us,” is“our” ~~not~~and ~~incorporated~~“ours” byare ~~reference~~used ~~into~~to ~~this~~refer ~~report~~to DP&L, respectively and altogether, unless the context indicates otherwise.

~~Part~~ITEM I1. –FINANCIAL ~~Financial Information~~STATEMENTS

This report includes the combined filing of DPL and DP&L. Throughout this report, the terms “we,” “us,” “our” and “ours” are used to refer to both DPL and DP&L, respectively and altogether, unless the context indicates otherwise. Discussions or areas of this report that apply only to DPL or DP&L will be clearly noted in the applicable section.

Item 1 – Financial Statements

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FINANCIAL STATEMENTS

~~DPL~~AES ~~INC.~~Ohio

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DPL INC.
AES Ohio
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Condensed Statements of Operations
	Three months ended June 30, 2016						Six months endedJune 30,
(Unaudited)
$ in millions	2016			2015			2016				2015
				Three months ended										Six months ended
Revenues	$	328.3		$	365.9		$	692.3			$	848.8
				June 30,										June 30,
Cost of revenues:
$ in millions				2025					2024					2025		2024
Fuel	60.2			54.4			127.1				130.8
REVENUE				$	227.6				$	206.9				$	479.7	$	431.2
Purchased power	96.9			120.3			218.8				313.6
OPERATING COSTS AND EXPENSES:
Total cost of revenues	157.1			174.7			345.9				444.4
Net purchased power				82.5					69.2					177.3		158.7
Gross margin	171.2			191.2			346.4				404.4
Operation and maintenance				64.8					60.8					128.7		121.5
Operating expenses:
Depreciation and amortization				29.0					20.7					57.8		42.8
Operation and maintenance	77.2			84.6			165.7				171.6
Taxes other than income taxes				27.7					26.9					63.9		56.1
Depreciation and amortization	36.0			33.3			69.4				67.1
Other, net				—					—					—		1.1
General taxes	21.6			22.0			42.6				45.0
Total operating costs and expenses				204.0					177.6					427.7		380.2
Fixed-asset impairment	235.5			—			235.5				—
OPERATING INCOME				23.6					29.3					52.0		51.0
Other	—			(0.2		)	0.1				0.2
OTHER INCOME / (EXPENSE), NET:
Total operating expenses	370.3			139.7			513.3				283.9
Interest expense, net				(13.7)					(11.7)					(28.4)		(22.9)
Operating income / (loss)	(199.1		)	51.5			(166.9		)		120.5
Other income / (expense), net				(0.4)					1.3					(1.7)		2.5
Other income / (expense), net
Total other expense, net				(14.1)					(10.4)					(30.1)		(20.4)
Investment income	0.3			0.2			0.2				—
INCOME BEFORE INCOME TAX				9.5					18.9					21.9		30.6
Interest expense	(26.0		)	(30.9		)	(52.3		)		(61.4		)
Income tax expense				4.0					3.8					5.7		6.1
Charge for early retirement of debt	—			—			(2.6		)		—
NET INCOME				$	5.5				$	15.1				$	16.2	$	24.5
Other expense	(0.3		)	(0.2		)	(0.7		)		(0.7		)
Total other expense, net	(26.0		)	(30.9		)	(55.4		)		(62.1		)
Earnings / (loss) from continuing operations before income taxes	(225.1		)	20.6			(222.3		)		58.4
Income tax expense / (benefit) from continuing operations	(88.3		)	5.8			(87.7		)		16.8
Net income / (loss) from continuing operations	(136.8		)	14.8			(134.6		)		41.6
Discontinued operations (Note 11)
Income / (loss) from discontinued operations	—			1.6			(0.7		)		5.2
Gain from disposal of discontinued operations	—			—			49.2				—
Income tax expense / (benefit) for discontinued operations	—			(5.3		)	18.9				(3.6		)
Discontinued operations	—			6.9			29.6				8.8
Net income / (loss)	$	(136.8	)	$	21.7		$	(105.0	)		$	50.4

See Notes to Condensed ~~Consolidated~~ Financial Statements.

These interim statements are unaudited.

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DPL INC.
AES Ohio
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME / (LOSS)
Condensed Statements of Comprehensive Income
	Three months ended June 30, 2016						Six months endedJune 30,
(Unaudited)
$ in millions	2016			2015			2016				2015
				Three months ended										Six months ended
Net income / (loss)	$	(136.8	)	$	21.7		$	(105.0	)		$	50.4
				June 30,										June 30,
Available-for-sale securities activity:
$ in millions				2025					2024					2025		2024
Change in fair value of available-for-sale securities, net of income tax expense of $0.0, $(0.3), $(0.1) and $0.0 for each respective period	(0.1		)	(0.4		)	0.1				0.1
NET INCOME				$	5.5				$	15.1				$	16.2	$	24.5
Reclassification to earnings, net of income tax expense of $0.0, $(0.2), $0.0 and $0.0 for each respective period	0.1			0.4			—				—
Unfunded pension and other postretirement activity:
Total change in fair value of available-for-sale securities	—			—			0.1				0.1
Reclassification to earnings, net of income tax effect of $(0.1), $(0.1), $(0.2) and $(0.2) for each respective period				0.5					0.4					1.0		0.8
Derivative activity:
Other comprehensive income				0.5					0.4					1.0		0.8
Change in derivative fair value, net of income tax (expense) / benefit of $4.7, $(1.0), $(7.1) and $(1.0) for each respective period	(8.5		)	1.7			13.0				1.8
NET COMPREHENSIVE INCOME				$	6.0				$	15.5				$	17.2	$	25.3
Reclassification to earnings, net of income tax benefit of $5.9, $0.9, $10.7 and $0.5 for each respective period	(10.8		)	(1.9		)	(19.0		)		(1.4		)
Total change in fair value of derivatives	(19.3		)	(0.2		)	(6.0		)		0.4
Pension and postretirement activity:
Reclassification to earnings, net of income tax expense of $0.0, $(0.5), $(0.2) and $(0.4) for each respective period	0.1			(0.4		)	—				(0.2		)
Total change in unfunded pension obligation	0.1			(0.4		)	—				(0.2		)
Other comprehensive income / (loss)	(19.2		)	(0.6		)	(5.9		)		0.3
Net comprehensive income / (loss)	$	(156.0	)	$	21.1		$	(110.9	)		$	50.7

See Notes to Condensed ~~Consolidated~~ Financial Statements.

These interim statements are unaudited.

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DPL INC.
AES Ohio
CONDENSED CONSOLIDATED BALANCE SHEETS
Condensed Balance Sheets
	June 30,			December 31,
(Unaudited)
$ in millions	~~2016~~			~~2015~~June 30, 2025			December 31, 2024
ASSETS
Current assets:
CURRENT ASSETS:
Cash and cash equivalents	$	~~73.4~~		$	3237.48		$	24.6
Restricted cash	33.2			92.7
Accounts receivable, net of allowance for credit losses of $10.1 and $6.1, respectively (Note 1)				136.4			106.6
Accounts receivable, net (Note 2)	107.8			120.9
Inventories				72.4			69.0
Inventories (Note 2)	87.5			109.1
Taxes applicable to subsequent years				67.9			137.1
Taxes applicable to subsequent years	39.4			81.2
Regulatory assets, current				97.2			82.0
Regulatory assets, current	0.3			14.4
Taxes receivable				22.1			24.9
Other prepayments and current assets	50.8			44.5
Prepayments and other current assets				13.0			8.4
Assets held for sale, current	—			62.2
Total current assets				446.8			452.6
Total current assets	392.4			557.4
NON-CURRENT ASSETS:
Property, plant & equipment:
Property, plant & equipment, net of accumulated depreciation of $1,141.3 million and $1,115.5 million, respectively				2,676.7			2,546.2
Property, plant & equipment	2,678.8			2,909.0
Regulatory assets, non-current				131.4			140.0
Less: Accumulated depreciation and amortization	(449.0		)	(432.3		)
Intangible assets, net of amortization				171.1			173.2
	2,229.8			2,476.7
Other non-current assets				36.6			43.2
Construction work in process	97.6			85.0
Total other non-current assets				3,015.8			2,902.6
Total net property, plant & equipment	2,327.4			2,561.7
Total assets				$	3,462.6		$	3,355.2
Other non-current assets:
LIABILITIES AND SHAREHOLDER'S EQUITY
Regulatory assets, non-current	186.1			179.9
CURRENT LIABILITIES:
Intangible assets, net of amortization	0.9			5.0
Short-term and current portion of long-term debt (Note 4)				$	310.2		$	290.1
Other deferred assets	24.6			20.7
Accounts payable				111.0			132.1
Total other non-current assets	211.6			205.6
Accrued taxes				126.6			115.2
Total assets	$	2,931.4		$	3,324.7
Accrued interest				9.9			10.2
LIABILITIES AND SHAREHOLDER'S EQUITY
Customer deposits				10.8			14.2
Current liabilities:
Regulatory liabilities, current				6.8			10.3
Current portion of long-term debt (Note 5)	$	514.0		$	572.8
Accrued and other current liabilities				35.6			32.2
Accounts payable	80.6			97.5
Total current liabilities				610.9			604.3
Accrued taxes	157.8			142.4
NON-CURRENT LIABILITIES:
Accrued interest	20.8			21.4
Long-term debt (Note 4)				1,012.9			1,012.7
Security deposits	15.2			15.2
Deferred income taxes				223.4			217.6
Regulatory liabilities, current	29.9			24.4
Taxes payable				68.3			137.5
Insurance and claims costs	5.6			5.9
Regulatory liabilities, non-current				173.9			169.4
Other current liabilities	65.0			54.5
Accrued pension and other postretirement obligations				23.5			30.7
Deposit received on sale of DPLER	—			75.5
Other non-current liabilities				4.6			5.2
Liabilities held for sale, current	—			1.6
Total non-current liabilities				1,506.6			1,573.1
Total current liabilities	888.9			1,011.2
Total liabilities				2,117.5			2,177.4
Non-current liabilities:
COMMITMENTS AND CONTINGENCIES (Note 8)
Long-term debt (Note 5)	1,409.3			1,420.5
SHAREHOLDER'S EQUITY:
Deferred taxes	467.4			568.7
Common stock, at par value of $0.01 per share				0.4			0.4
Taxes payable	39.1			84.1
50,000,000 shares authorized, 41,172,173 shares issued and outstanding
Regulatory liabilities, non-current	128.7			127.0
Other paid-in capital				1,327.7			1,177.6
Pension, retiree and other benefits	79.9			87.1
Accumulated other comprehensive loss				(25.4)			(26.4)
Other deferred credits	91.1			88.3
Retained earnings				42.4			26.2
Total non-current liabilities	2,215.5			2,375.7
Total common shareholder's equity				1,345.1			1,177.8
Redeemable preferred stock of subsidiary	18.4			18.4
Total liabilities and shareholder's equity				$	3,462.6		$	3,355.2
Commitments and contingencies (Note 8)
Common shareholder's equity:
Common stock:
1,500 shares authorized; 1 share issued and outstanding at June 30, 2016 and December 31, 2015	—			—
Other paid-in capital	2,237.8			2,237.7
Accumulated other comprehensive income	11.5			17.4
Accumulated deficit	(2,440.7		)	(2,335.7		)
Total common shareholder's equity	(191.4		)	(80.6		)
Total liabilities and shareholder's equity	$	2,931.4		$	3,324.7

See Notes to Condensed ~~Consolidated~~ Financial Statements.

These interim statements are unaudited.

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DPL INC.
AES Ohio
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Condensed Statements of Cash Flows
	Six months ended June 30,
(Unaudited)
$ in millions	2016			2015
				Six months ended June 30,
Cash flows from operating activities:
$ in millions				2025			2024
Net income / (loss)	$	(105.0	)	$	50.4
CASH FLOWS FROM OPERATING ACTIVITIES:
Adjustments to reconcile net income / (loss) to net cash from operating activities:
NET INCOME				$	16.2		$	24.5
Depreciation and amortization	69.4			69.3
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of debt market value adjustments	0.1			—
Depreciation and amortization				57.8			42.8
Charge for early redemption of debt	2.6			—
Amortization of deferred financing costs and debt discounts				0.8			0.7
Deferred income taxes	~~(95.9~~		)	~~(17~~2.58		)	6.1
Fixed-asset impairment	235.5			—
Loss on asset disposal				—			1.1
Gain on sale of business	(49.2		)	—
Allowance for equity funds used during construction				(0.1)			(4.0)
Changes in certain assets and liabilities:
Accounts receivable	52.7			25.0
Accounts receivable, net				(29.8)			(0.6)
Inventories	~~21.6~~			(43.54)		)	(12.1)
Prepaid taxes	0.2			(0.5		)
Taxes applicable to subsequent years				69.2			59.9
Taxes applicable to subsequent years	41.7			38.6
Prepayments and other current assets				(4.6)			(1.4)
Deferred regulatory costs, net	8.0			21.3
Current regulatory assets and liabilities, net				(18.6)			(20.7)
Accounts payable	(11.7		)	3.3
Non-current regulatory assets and liabilities, net				7.8			11.2
Accrued taxes payable	(25.7		)	(15.5		)
Other non-current assets				(0.8)			9.7
Accrued interest payable	(0.8		)	—
Accounts payable				(28.8)			11.1
Unamortized Investment tax credit	(0.2		)	—
Accrued taxes payable / receivable				(55.1)			(53.9)
Insurance and claims costs	(0.4		)	—
Accrued interest				(0.2)			6.0
Pension, retiree and other benefits	(4.2		)	3.8
Accrued and other current liabilities				0.6			6.5
Other	(6.3		)	(2.2		)
Accrued pension and other postretirement benefits				(7.2)			(6.6)
Net cash provided by operating activities	132.4			171.5
Other				0.7			1.4
Cash flows from investing activities:
Net cash provided by operating activities				7.3			81.7
Capital expenditures	(79.1		)	(64.8		)
CASH FLOWS FROM INVESTING ACTIVITIES:
Proceeds from sale of business	75.5			1.3
Capital expenditures				(157.5)			(288.1)
Insurance proceeds	3.2			—
Cost of removal payments				(5.5)			(15.3)
Purchase of renewable energy credits	(0.2		)	(0.2		)
Other investing activities, net				(0.4)			(0.6)
Increase in restricted cash	(16.0		)	(8.4		)
Net cash used in investing activities				(163.4)			(304.0)
Other investing activities, net	0.7			0.4
CASH FLOWS FROM FINANCING ACTIVITIES:
Net cash used in investing activities	(15.9		)	(71.7		)
Borrowings from revolving credit facilities				310.0			230.0
Cash flows from financing activities:
Repayment of borrowings from revolving credit facilities				(290.0)			(110.0)
Payments of deferred financing costs	—			(0.1		)
Distributions to parent				—			(21.0)
Retirement of long-term debt	(75.4		)	(0.1		)
Equity contributions from parent				150.0			130.0
Borrowings from revolving credit facilities	—			15.0
Other financing activities, net				(0.7)			—
Repayment of borrowings from revolving credit facilities	—			(15.0		)
Net cash provided by financing activities				169.3			229.0
Other financing activities, net	(0.1		)	—
Cash, cash equivalents, and restricted cash:
Net cash used in financing activities	(75.5		)	(0.2		)
Net increase in cash, cash equivalents and restricted cash				13.2			6.7
Cash and cash equivalents:
Cash, cash equivalents and restricted cash at beginning of period				24.7			15.6
Net change	41.0			99.6
Cash, cash equivalents and restricted cash at end of period				$	37.9		$	22.3
Balance at beginning of period	32.4			17.0
Supplemental cash flow information:
Cash and cash equivalents at end of period	$	73.4		$	116.6
Interest paid, net of amounts capitalized				$	28.5		$	16.8
Supplemental cash flow information:
Non-cash investing activities:
Interest paid, net of amounts capitalized	$	51.1		$	55.6
Accruals for capital expenditures				$	56.4		$	94.5
Income taxes paid / (refunded), net	$	0.1		$	0.5
Non-cash financing and investing activities:
Accruals for capital expenditures	$	8.3		$	10.0

See Notes to Condensed ~~Consolidated~~ Financial Statements.

These interim statements are unaudited.

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DPL Inc.


AES Ohio
Condensed Statements of Shareholder's Equity
(Unaudited)
	Common Stock
$ in millions	Outstanding Shares	Amount		Other Paid-in Capital		Accumulated Other Comprehensive Loss		Retained Earnings		Total
Balance at January 1, 2025	41,172,173	$	0.4	$	1,177.6	$	(26.4)	$	26.2	$	1,177.8
Net income	—	—		—		—		10.7		10.7
Other comprehensive income	—	—		—		0.5		—		0.5


Balance at March 31, 2025	41,172,173	0.4		1,177.6		(25.9)		36.9		1,189.0
Net income	—	—		—		—		5.5		5.5
Other comprehensive income	—	—		—		0.5		—		0.5

Equity contribution from parent	—	—		150.0		—		—		150.0
Other	—	—		0.1		—		—		0.1
Balance at June 30, 2025	41,172,173	$	0.4	$	1,327.7	$	(25.4)	$	42.4	$	1,345.1

Notes to Condensed Consolidated Financial Statements (Unaudited)


	Common Stock
$ in millions	Outstanding Shares	Amount		Other Paid-in Capital		Accumulated Other Comprehensive Loss		Retained Earnings		Total
Balance at January 1, 2024	41,172,173	$	0.4	$	977.4	$	(27.9)	$	29.3	$	979.2
Net income	—	—		—		—		9.4		9.4
Other comprehensive income	—	—		—		0.4		—		0.4


Other	—	—		0.1		—		—		0.1
Balance at March 31, 2024	41,172,173	0.4		977.5		(27.5)		38.7		989.1
Net income	—	—		—		—		15.1		15.1
Other comprehensive income	—	—		—		0.4		—		0.4
Distributions to parent	—	—		—		—		(21.0)		(21.0)
Equity contributions from parent	—	—		130.0		—		—		130.0

Balance at June 30, 2024	41,172,173	$	0.4	$	1,107.5	$	(27.1)	$	32.8	$	1,113.6

~~Note~~See 1Notes –to ~~Overview~~Condensed ~~and~~Financial ~~Summary of Significant Accounting Policies~~Statements.

Description of Business

DPL is a diversified regional energy company organized in 1985 under the laws of Ohio. DPL’s one reportable segment is the Utility segment, comprised of its DP&L subsidiary. DPLER, which was DPL's competitive retail segment, was sold January 1, 2016. See Note 10 – Business Segments for more information relating to these reportable segments. The terms “we,” “us,” “our” and “ours” are used to refer to DPL and its subsidiaries.

DPL is an indirectly wholly-owned subsidiary of AES.

DP&L is a public utility incorporated in 1911 under the laws of Ohio. Beginning in 2001, Ohio law gave Ohio consumers the right to choose the electric generation supplier from whom they purchase retail generation service; however, distribution and transmission retail services are still regulated. DP&L has the exclusive right to provide such distribution and transmission services to approximately 517,000 customers located in West Central Ohio. Additionally, DP&L offers retail SSO electric service to residential, commercial, industrial and governmental customers in a 6,000 square mile area of West Central Ohio. DP&L owns multiple coal-fired and peaking electric generating facilities as well as numerous transmission facilities, all of which are included in the financial statements at amortized cost. Under the ESP 2 order, DP&L was required to source 100% of the generation for its SSO customers through a competitive bid process. Principal industries located in DP&L’s service territory include automotive, food processing, paper, plastic, manufacturing and defense. DP&L's distribution sales reflect the general economic conditions, seasonal weather patterns, retail competition in our service territory and the market price of electricity. DP&L sells all of its energy and capacity into the wholesale market. Based on the ESP 2 order, on June 4, 2014, the PUCO issued an entry on rehearing which required DP&L to separate its generation assets from its transmission and distribution assets no later than January 1, 2017.

DPL’s other significant subsidiaries include AES Ohio Generation, which owns and operates peaking generating facilities from which it makes wholesale sales of electricity, and MVIC, our captive insurance company that provides insurance services to DPL and our subsidiaries. DPL owns all of the common stock of its subsidiaries.

DPL also has a wholly-owned business trust, DPL Capital Trust II, formed for the purpose of issuing trust capital securities to investors.

DP&L’s electric transmission and distribution businesses are subject to rate regulation by federal and state regulators while its generation business is deemed competitive under Ohio law. Accordingly, DP&L applies the accounting standards for regulated operations to its electric transmission and distribution businesses and records regulatory assets when incurred costs are expected to be recovered in future customer rates, and regulatory liabilities when current cost recoveries in customer rates relate to expected future costs.

DPL and its subsidiaries employed 1,169 people as of June 30, 2016, of which 1,161 were employed by DP&L. Approximately 62% of all DPL employees are under a collective bargaining agreement that expires on October 31, 2017.

Financial Statement Presentation

DPL’s Condensed Consolidated Financial Statements include the accounts of DPL and its wholly-owned subsidiaries except for DPL Capital Trust II, which is not consolidated, consistent with the provisions of GAAP. DP&L has undivided ownership interests in five coal-fired generating facilities, various peaking generating

facilities and numerous transmission facilities, all of which are included in the financial statements at amortized cost, which was adjusted to fair value at the date of the Merger for DPL. Operating revenues and expenses of these facilities are included on a pro rata basis in the corresponding lines in the Condensed Consolidated Statements of Operations.

Certain immaterial amounts from prior periods have been reclassified to conform to the current period presentation.

All material intercompany accounts and transactions are eliminated in consolidation.

Table of Contents

~~These~~AES financial statements have been prepared in accordance with GAAP for interim financial statements, the instructions of Form 10-Q and Regulation S-X. Accordingly, certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with GAAP have been omitted from this interim report. Therefore, our interim financial statements in this report should be read along with the annual financial statements included in our Form 10-K for the fiscal year ended December 31, 2015.Ohio

InNotes ~~the~~to ~~opinion~~Unaudited ~~of our management, the~~ Condensed ~~Consolidated~~ Financial Statements presented in this report contain all adjustments necessary to fairly state our financial position as of June 30, 2016; our results of operations for the three and six months ended June 30, 2016 and 2015 and our cash flows for the six months ended June 30, 2016 and 2015. Unless otherwise noted, all adjustments are normal and recurring in nature. Due to various factors, including, but not limited to, seasonal weather variations, the timing of outages of EGUs, changes in economic conditions involving commodity prices and competition, and other factors, interim results for the three and six months ended June 30, 2016 may not be indicative of our results that will be realized for the full year ending December 31, 2016.

~~The~~For ~~preparation of financial statements in conformity with GAAP requires us to make estimates and judgments that affect~~ the ~~reported~~three ~~amounts of assets~~ and ~~liabilities,~~six ~~the~~months ~~disclosure~~ended ~~of contingent assets and liabilities~~June 30, ~~and~~2025 ~~the revenues~~ and expenses of the periods reported. Actual results could differ from these estimates. Significant items subject to such estimates and judgments include: the carrying value of property, plant and equipment; unbilled revenues; the valuation of derivative instruments; the valuation of insurance and claims liabilities; the valuation of allowances for receivables and deferred income taxes; regulatory assets and liabilities; liabilities recorded for income tax exposures; litigation; contingencies; the valuation of AROs; and assets and liabilities related to employee benefits.2024

As1. aOVERVIEW ~~result~~AND ofSUMMARY ~~push~~OF ~~down~~SIGNIFICANT ~~accounting,~~ACCOUNTING ~~DPL’s Condensed Consolidated Statements of Operations subsequent to the Merger include depreciation of fixed assets based upon their fair value at the Merger date.~~POLICIES

~~Accounting~~DP&L, ~~for~~which ~~Taxes~~does ~~Collected~~business as AES Ohio, is a public utility incorporated in 1911 under the laws of Ohio. Beginning in 2001, Ohio law gave Ohio consumers the right to choose the electric generation supplier from ~~Customers~~whom they purchase retail generation service; however, retail transmission and ~~Remitted~~distribution services are still regulated. AES Ohio has the exclusive right to ~~Governmental~~provide ~~Authorities~~such transmission and distribution services to approximately 543,000 customers located in West Central Ohio. Principal industries located in AES Ohio’s service territory include automotive, food processing, paper, plastic, manufacturing and defense. AES Ohio also provides retail SSO electric service to residential, commercial, industrial and governmental customers in a 6,000-square mile area of West Central Ohio. AES Ohio sources all of the generation for its SSO customers through a competitive bid process. AES Ohio's sales reflect the general economic conditions, seasonal weather patterns of the area, the market price of electricity and customer energy efficiency initiatives. AES Ohio owns numerous transmission facilities. AES Ohio records revenue and expenses for its proportional share of energy and capacity from its investment in OVEC. AES Ohio has one reportable segment, the Utility segment. In addition to AES Ohio's electric transmission and distribution businesses, the Utility segment includes revenue and expenses associated with AES Ohio's investment in OVEC. AES Ohio is an indirect majority-owned subsidiary of DPL.

~~DP&L~~AES ~~collects~~Ohio’s ~~certain~~electric ~~excise~~transmission ~~taxes~~and ~~levied~~distribution bybusinesses ~~state~~are orsubject ~~local~~to ~~governments~~rate ~~from~~regulation ~~its~~by ~~customers. These~~federal ~~taxes~~and ~~are~~state ~~accounted~~regulators. ~~for~~Accordingly, onAES aOhio ~~net~~applies ~~basis~~the ~~and~~accounting ~~not~~standards ~~included~~for inregulated ~~revenue. The~~operations ~~amounts~~to ofits ~~such~~electric ~~taxes~~transmission ~~collected~~and ~~for~~distribution ~~the~~businesses ~~three~~and ~~months~~records ~~ended~~regulatory ~~June~~assets ~~30,~~when ~~2016~~incurred ~~and~~costs ~~2015~~are ~~were~~expected ~~$11.6~~to ~~million~~be ~~and~~recovered ~~$11.5~~in ~~million,~~future ~~respectively. The~~customer ~~amounts~~rates ofand ~~such~~regulatory ~~taxes~~liabilities ~~collected~~when ~~for~~current ~~the~~cost ~~six~~recoveries ~~months~~in ~~ended~~customer ~~June~~rates ~~30,~~relate ~~2016~~to ~~and~~expected ~~2015~~future ~~were~~costs ~~$24.5~~or ~~million~~overcollections ~~and~~of ~~$25~~riders.~~5 million, respectively.~~

~~Related~~Agreement ~~Party~~to ~~Transactions~~Sell Minority Interest in AES Ohio

On April 4, 2025, DPL ~~has~~LLC ~~issued~~(formerly ~~debt~~known toas DPL Inc.) ("DPL") consummated the transactions contemplated by (i) a Purchase and Sale Agreement with Astrid Holdings LP ("Investor"), a wholly-owned ~~business~~subsidiary ~~trust~~of CDPQ, dated as of September 13, 2024, pursuant to which DPL ~~Capital~~agreed ~~Trust~~to IIsell to Investor 15% of the issued and outstanding shares of common stock, no par value per share, of AES Ohio Holdings, Inc. ~~See~~ ~~Note~~("Ohio 5Holdings" –and, ~~Debt~~such agreement, the "Ohio Holdings Purchase Agreement") for ~~further~~a ~~information~~purchase price of approximately $272 million, and (ii) a Purchase and Sale Agreement with Investor, pursuant to which DPL agreed to sell to Investor 17.65% of the issued and outstanding shares of common stock, no par value per share, of AES Ohio Investments, Inc. ("Ohio Investments" and, such agreement, the "Ohio Investments Purchase Agreement" and together with the Ohio Holdings Purchase Agreement, the "Purchase Agreements") for a purchase price of approximately $272 million Pursuant to the consummation of the transactions contemplated by the Ohio Holdings Purchase Agreement and the Ohio Investments Purchase Agreement together, the ("Closings"), CDPQ owns an aggregate indirect equity interest in AES Ohio of approximately 30%, with total proceeds to DPL of approximately $544 million. There is no change in management or operational control of DPL, Ohio Investments, Ohio Holdings or AES Ohio as a result of these transactions.

~~See~~Pursuant ~~Note~~to 9the –Purchase ~~Related~~Agreements, ~~Party~~prior ~~Transactions~~to ~~for~~the ~~more~~Ohio ~~information~~Holdings onClosing, ~~related~~DPL ~~party~~contributed ~~transactions~~to Ohio Holdings 100% of the issued and outstanding shares of AES Ohio, such that Ohio Holdings owns 100% of AES Ohio. Immediately after the Ohio Holdings Closing and immediately prior to the Ohio Investments Closing, DPL contributed to Ohio Investments 85% of the issued and outstanding shares of Ohio Holdings, such that Ohio Investments owns a direct equity interest in Ohio Holdings of 85%. Following the Closings, DPL owns 82.35% of the issued and outstanding shares of Ohio Investments, Ohio Investments owns 85% of the issued and outstanding shares of Ohio Holdings, and Ohio Holdings owns 100% of the issued and outstanding shares of AES Ohio.

~~New~~Financial ~~Accounting~~Statement ~~Pronouncements~~Presentation

~~The~~AES ~~following~~Ohio ~~table~~does ~~provides~~not ahave ~~brief~~any ~~description~~subsidiaries. ofWe ~~recent~~have ~~accounting~~evaluated ~~pronouncements~~subsequent ~~that~~events ~~could~~through ~~have~~the adate ~~material~~this ~~impact~~report onwas ~~our~~issued. ~~consolidated financial statements:~~

Accounting Standard	Description	Date of Adoption	Effect on the financial statements upon adoption
New Accounting Standards Adopted
ASU No. 2015-15, Interest - Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements	Given the absence of authoritative guidance within ASU 2015-03, this standard clarifies that the SEC Staff would not object to an entity presenting debt issuance costs related to line-of-credit arrangements as an asset that is subsequently amortized ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. Transition method: retrospective.	January 1, 2016	Deferred financing costs related to lines-of-credit of approximately $3.1 million recorded within Other deferred assets were not reclassified.

Interim Financial Presentation

The accompanying unaudited condensed financial statements and footnotes have been prepared in accordance with GAAP, as contained in the FASB ASC, for interim financial information and Article 10 of Regulation S-X issued

Table of Contents

Accounting Standard	Description	Date of Adoption	Effect on the financial statements upon adoption
ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30)	The standard simplifies the presentation of debt issuance costs by requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the standard. Transition method: retrospective.	January 1, 2016	Deferred financing costs of approximately $2.1 million previously classified within Other prepayments and current assets and $14.0 million previously classified within Other deferred assets were reclassified to reduce the related debt liabilities.
ASU No. 2015-02, Consolidation - Amendments to the Consolidation Analysis (Topic 810)	The standard makes targeted amendments to the current consolidation guidance and ends the deferral granted to investment companies from applying the VIE guidance. The standard amends the evaluation of whether (1) fees paid to a decision-maker or service providers represent a variable interest, (2) a limited partnership or similar entity has the characteristics of a VIE and (3) a reporting entity is the primary beneficiary of a VIE. Transition method: retrospective.	January 1, 2016	There were no changes to the consolidation conclusions.
New Accounting Standards Issued But Not Yet Effective
2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	This standard updates the impairment model for financial assets measured at amortized cost to an expected loss model rather than an incurred loss model. It also allows for the presentation of credit losses on available-for-sale debt securities as an allowance rather than a write down. Transition method: various.	January 1, 2020 Early adoption is permitted only as of January 1, 2019.	We are currently evaluating the impact of adopting the standard on our consolidated financial statements.
2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting	The standard simplifies the following aspects of accounting for share-based payment awards: accounting for income taxes, classification of excess tax benefits on the statement of cash flows, forfeitures, statutory tax withholding requirements, classification of awards as either equity or liabilities and classification of employee taxes paid on statement of cash flows when an employer withholds shares for tax-withholding purposes. Transition method: Various.	January 1, 2017. Early adoption is permitted.	We are currently evaluating the impact of adopting the standard on our consolidated financial statements.
ASU No. 2016-06, Derivatives and Hedging (Topic 815) - Contingent Put and Call Options in Debt Instruments	This standard clarifies the requirements for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. When a call (put) option is contingently exercisable, an entity no longer has to assess whether the event that triggers the ability to exercise a call (put) option is related to interest rates or credit risks. Transition method: a modified retrospective basis to existing debt instruments as of the effective date.	January 1, 2017. Early adoption is permitted.	We are currently evaluating the impact of adopting the standard, but do not anticipate a material impact on our consolidated financial statements.
ASU No. 2016-05, Derivatives and Hedging (Topic 815) - Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships	The standard clarifies that a change in the counterparty to a derivative instrument that has been designated as the hedging instrument under Topic 815 does not require de-designation of that hedging relationship provided that all other hedge accounting criteria (including those in paragraphs 815-20-35-14 through 35-18) continue to be met. Transition method: prospective or a modified retrospective basis.	January 1, 2017. Early adoption is permitted.	We are currently evaluating the impact of adopting the standard, but do not anticipate a material impact on our consolidated financial statements.
ASU No. 2016-02, Leases (Topic 842)	The standard creates Topic 842, Leases which supersedes Topic 840, Leases, and introduces a lessee model that brings substantially all leases onto the balance sheet while retaining most of the principles of the existing lessor model in U.S. GAAP and aligning many of those principles with ASC 606, Revenue from Contracts with Customers. Transition method: modified retrospective approach with certain practical expedients.	January 1, 2019. Early adoption is permitted.	We are currently evaluating the impact of adopting the standard on our consolidated financial statements.

by the SEC. Accordingly, they do not include all the information and footnotes required by GAAP for annual fiscal reporting periods. In the opinion of management, the interim financial information includes all adjustments of a normal recurring nature necessary for a fair presentation of the results of operations, financial position, comprehensive income or loss, changes in shareholder's equity, and cash flows. The results of operations for the three and six months ended June 30, 2025 are not necessarily indicative of expected results for the year ending December 31, 2025. The accompanying condensed financial statements are unaudited and should be read in conjunction with the 2024 audited financial statements and footnotes thereto, which are included in our Form 10-K.

Use of Management Estimates

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities and the revenue and expenses of the periods reported. Actual results could differ from these estimates and assumptions. Significant items subject to such estimates and assumptions include: the carrying value of property, plant and equipment; unbilled revenue; the valuation of allowances for credit losses and deferred income taxes; regulatory assets and liabilities; reserves recorded for income tax exposures; litigation; contingencies; and assets and liabilities related to employee benefits.

Reclassifications

Certain amounts from prior periods have been reclassified to conform to the current period presentation.

Cash, Cash Equivalents and Restricted Cash

The following table summarizes cash, cash equivalents, and restricted cash amounts reported on the Condensed Balance Sheets that reconcile to the total of such amounts as shown on the Condensed Statements of Cash Flows:


$ in millions	June 30, 2025		December 31, 2024
Cash and cash equivalents	$	37.8	$	24.6
Restricted cash (included in Prepayments and other current assets)	0.1		0.1
Total cash, cash equivalents and restricted cash	$	37.9	$	24.7

Accounts Receivable and Allowance for Credit Losses

The following table summarizes accounts receivable as of June 30, 2025 and December 31, 2024:


$ in millions	June 30, 2025		December 31, 2024
Accounts receivable, net:
Customer receivables	$	100.4	$	79.0
Unbilled revenue	28.6		24.1
Amounts due from affiliates	3.8		3.6
Other	13.7		6.0
Allowance for credit losses	(10.1)		(6.1)
Total accounts receivable, net	$	136.4	$	106.6

The following table is a roll forward of our allowance for credit losses related to the accounts receivable balances for the six months ended June 30, 2025 and 2024:


	Six months ended
	June 30,
$ in millions	2025		2024
Allowance for credit losses:
Beginning balance	$	6.1	$	0.9
Current period provision	3.6		2.3
Write-offs charged against allowance	(0.3)		(2.7)
Recoveries and account write-ons	0.7		0.5
Ending balance	$	10.1	$	1.0

The allowance for credit losses primarily relates to utility customer receivables, including unbilled amounts. Expected credit loss estimates are developed by disaggregating customers into those with similar credit risk characteristics and using historical credit loss experience. In addition, we also consider how current and future economic conditions are expected to impact collectability, as applicable, of our receivables balance. Amounts are

Table of Contents

Accounting Standard	Description	Date of Adoption	Effect on the financial statements upon adoption
ASU No. 2016-01, Financial Instruments - Overall (Topic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities	The standard significantly revises an entity’s accounting related to (1) the classification and measurement of investments in equity securities and (2) the presentation of certain fair value changes for financial liabilities measured at fair value. Also, it amends certain disclosure requirements associated with the fair value of financial instruments. Transition: cumulative effect in Retained Earnings as of adoption or prospectively for equity investments without readily determinable fair value.	January 1, 2018. Limited early adoption permitted.	We are currently evaluating the impact of adopting the standard, but do not anticipate a material impact on our consolidated financial statements.
ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory	The standard replaces the current lower of cost or market test with a lower of cost or net realizable value test. Transition method: prospectively.	January 1, 2017. Early adoption is permitted.	We are currently evaluating the impact of adopting the standard on our consolidated financial statements.
ASU Nos. 2014-09, 2016-08, 2016-10, 2016-12 Revenue from Contracts with Customers (Topic 606)	The Revenue from Contracts with Customers standard provides a single and comprehensive revenue recognition model for all contracts with customers to improve comparability. The revenue standard contains principles that an entity will apply to determine the measurement of revenue and timing revenue recognition. The standard requires an entity to recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. The amendments to the standard provide further clarification on contract revenue recognition specifically related to the implementation of the principal versus agent evaluation, the identification of performance obligations, clarification on accounting for licenses of intellectual property, and allows for the election to account for shipping and handling activities performed after control of a good has been transferred to the customer as a fulfillment cost. Transition method: a full retrospective or modified retrospective approach.	January 1, 2018 (deferred by ASU No. 2015-14). Earlier application is permitted only as of January 1, 2017.	We are currently evaluating the impact of adopting the standard on our consolidated financial statements.

written off when reasonable collections efforts have been exhausted. The current period provision and allowance for credit losses has increased due to a temporary pause of customer disconnections and certain collection efforts and write-off processes after the implementation of our customer billing system upgrade in the third quarter of 2024. AES Ohio reinstituted the customer disconnections process and collection efforts and write-off processes in late June 2025.

~~Note 2 – Supplemental Financial Information~~Inventories

~~Accounts~~Inventories ~~receivable~~consist ~~and~~of ~~Inventories~~materials ~~are~~and supplies as ~~follows~~of at June 30, ~~2016~~2025 and December 31, ~~2015:~~2024.

	June 30,			December 31,
$ in millions	2016			2015
Accounts receivable, net:
Unbilled revenue	$	38.9		$	43.3
Customer receivables	54.1			56.4
Amounts due from partners in jointly owned plants	10.9			16.0
Other	4.9			6.0
Provision for uncollectible accounts	(1.0		)	(0.8		)
Total accounts receivable, net	$	107.8		$	120.9
Inventories, at average cost:
Fuel and limestone	$	49.9		$	72.2
Plant materials and supplies	35.7			34.9
Other	1.9			2.0
Total inventories, at average cost	$	87.5		$	109.1

AFUDC

~~Accounts~~AES ~~receivable~~Ohio capitalizes an allowance for the net cost of ~~$31.0~~funds ~~million~~(interest ason borrowed funds and a reasonable rate of ~~December 31,~~return ~~2015~~on ~~have~~equity ~~been~~funds) ~~excluded~~used ~~from~~for ~~the~~construction ~~above~~purposes ~~table~~during asthe ~~they~~period ~~have~~of ~~been~~construction ~~reclassified~~with asa ~~"Assets~~corresponding ~~held~~credit ~~for~~to ~~sale"~~income. ~~See~~ ~~Note~~During 11the –three ~~Discontinued~~and ~~Operations.~~six months ended June 30, 2025 and 2024, AFUDC equity and AFUDC debt were as follows:


	Three months ended				Six months ended
	June 30,				June 30,
$ in millions	2025		2024		2025		2024
AFUDC equity	$	0.1	$	2.2	$	0.1	$	4.0
AFUDC debt	$	1.5	$	2.4	$	2.9	$	4.5

AOCI / AOCL

The changes in the components of AOCL during the six months ended June 30, 2025 are as follows:


$ in millions	Change in unfunded pension and other postretirement obligations
Balance as of January 1, 2025	$	(26.4)

Amounts reclassified from AOCL to earnings	1.0

Balance as of June 30, 2025	$	(25.4)

Accounting for Taxes Collected from Customers and Remitted to Governmental Authorities

AES Ohio collects certain excise taxes levied by state or local governments from its customers. These taxes are accounted for on a net basis and not included in revenue. The amounts of such taxes collected for the three and six months ended June 30, 2025 and 2024 were as follows:


	Three months ended				Six months ended
	June 30,				June 30,
$ in millions	2025		2024		2025		2024
Excise taxes collected	$	11.1	$	11.7	$	24.3	$	24.0

New Accounting Pronouncements Adopted in 2025

The Company assessed accounting pronouncements adopted in 2025 and determined that they were not applicable or did not have a material impact on the Company's Financial Statements.

New Accounting Pronouncements Issued But Not Yet Effective

The following table provides a brief description of recent accounting pronouncements that could have an impact on our consolidated financial statements. Accounting pronouncements not listed below were assessed and determined to be either not applicable or are expected to have no material impact on our financial statements.+

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Accumulated Other Comprehensive Income / (Loss)


ASU Number and Name	Description	Date of Adoption	Effect on the financial statements upon adoption
2023-09 Income Taxes (Topic 740): Improvements to Income Tax Disclosures	The amendments in this Update require that public business entities on an annual basis (1) disclose specific categories in the rate reconciliation and (2) provide additional information for reconciling items that meet a quantitative threshold. Furthermore, companies are required to disclose a disaggregated amount of income taxes paid at a federal, state, and foreign level as well as a break down of income taxes paid in a jurisdiction that comprises 5% of a company's total income taxes paid. Lastly, this ASU requires that companies disclose income (loss) from continuing operations before income tax at a domestic and foreign level and that companies disclose income tax expense from continuing operations on a federal, state, and foreign level.	The amendments in this Update are effective for fiscal years beginning after December 15, 2024.	We are currently evaluating the impact of adopting the standard on our financial statements. This ASU only affects disclosures, which will be provided when the amendment becomes effective.
2024-03: Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40)	The amendments in this Update require disclosure, in the notes to financial statements, of specified information about certain costs and expenses. The amendments require that at each interim and annual reporting period an entity: 1. Disclose the amounts of (a) purchases of inventory, (b) employee compensation, (c) depreciation, (d) intangible asset amortization, and (e) depreciation, depletion, and amortization recognized as part of oil- and gas-producing activities (DD&A) (or other amounts of depletion expense) included in each relevant expense caption. A relevant expense caption is an expense caption presented on the face of the income statement within continuing operations that contains any of the expense categories listed in (a)–(e). 2. Include certain amounts that are already required to be disclosed under current generally accepted accounting principles (GAAP) in the same disclosure as the other disaggregation requirements. 3. Disclose a qualitative description of the amounts remaining in relevant expense captions that are not separately disaggregated quantitatively. 4. Disclose the total amount of selling expenses and, in annual reporting periods, an entity’s definition of selling expenses.	The date for each amendment in this Update is effective for fiscal years beginning after December 15, 2026, and interim reporting periods beginning after December 15, 2027. Early adoption is permitted.	We are currently evaluating the impact of adopting the standard on our financial statements. This ASU only affects disclosures, which will be provided when the amendment becomes effective.

~~The~~2. ~~amounts~~REGULATORY ~~reclassified out of Accumulated Other Comprehensive Income / (Loss) by component during the three and six months ended June 30, 2016 and 2015 are as follows:~~MATTERS

Details about Accumulated Other Comprehensive Income / (Loss) components	Affected line item in the Condensed Consolidated Statements of Operations	Three months ended						Six months ended
		June 30,						June 30,
$ in millions		2016			2015			2016			2015
Gains and losses on Available-for-sale securities activity (Note 3):
	Other income	$	0.1		$	0.6		$	—		$	—
	Tax benefit	—			(0.2		)	—			—
	Net of income taxes	0.1			0.4			—			—
Gains and losses on cash flow hedges (Note 4):
	Interest expense	(0.3		)	(0.3		)	(0.5		)	(0.5		)
	Revenue	(20.1		)	(2.9		)	(37.3		)	(3.2		)
	Purchased power	3.7			0.4			8.1			1.8
	Total before income taxes	(16.7		)	(2.8		)	(29.7		)	(1.9		)
	Tax expense	5.9			0.9			10.7			0.5
	Net of income taxes	(10.8		)	(1.9		)	(19.0		)	(1.4		)
Amortization of defined benefit pension items (Note 7):
	Operation and maintenance	0.1			0.1			0.2			0.2
	Tax benefit	—			(0.5		)	(0.2		)	(0.4		)
	Net of income taxes	0.1			(0.4		)	—			(0.2		)
Total reclassifications for the period, net of income taxes		$	(10.6	)	$	(1.9	)	$	(19.0	)	$	(1.6	)

Ohio Legislation, AES Ohio ESPs and Smart Grid Plans

~~The~~Ohio ~~changes~~Energy ~~in the components of Accumulated Other Comprehensive Income / (Loss) during the six months ended June 30, 2016 are as follows:~~Legislation

$ in millions	Gains / (losses) on available-for-sale securities		Gains / (losses) on cash flow hedges			Change in unfunded pension obligation			Total
Balance January 1, 2016	$	0.4	$	26.7		$	(9.7	)	$	17.4
Other comprehensive income before reclassifications	0.1		13.0			—			13.1
Amounts reclassified from accumulated other comprehensive income / (loss)	—		(19.0		)	—			(19.0		)
Net current period other comprehensive income / (loss)	0.1		(6.0		)	—			(5.9		)
Balance June 30, 2016	$	0.5	$	20.7		$	(9.7	)	$	11.5

On April 30, 2025, the Ohio legislature passed new energy legislation (Sub. HB 15) that was signed by the Governor and will be effective August 14, 2025. The legislation allows Ohio’s electric utilities to file three-year forecasted base distribution rate cases, which would replace electric security plans (ESPs) and associated recovery riders. Among other provisions, the legislation eliminates as of its effective date, the LGR, which currently allows for recovery of net OVEC costs and revenues. Changes to the regulatory framework from this legislation, including the recovery of any remaining regulatory asset balance amounts or future net OVEC costs and revenues, could be material to our results of operations, financial condition and cash flows. As of June 30, 2025, AES Ohio established a reserve of $3.2 million for the LGR regulatory asset.

~~Note~~AES 3Ohio –ESP ~~Fair Value~~

~~The~~Current ~~fair~~Ohio ~~values~~law ofrequires ~~our~~utilities ~~financial~~to ~~instruments~~file ~~are~~either ~~based~~an onESP ~~published~~or ~~sources~~MRO ~~for~~plan ~~pricing~~to ~~when~~establish ~~possible~~SSO rates. We ~~rely~~AES onOhio ~~valuation~~is ~~models~~currently ~~only~~operating ~~when~~pursuant noto ~~other~~ESP ~~methods~~4, ~~exist~~described in the paragraph below. ~~The~~ ~~value~~From ofNovember ~~our~~1, ~~financial~~2017 ~~instruments~~through ~~represents~~December ~~our~~18, ~~best~~2019, ~~estimates~~AES Ohio operated pursuant to an approved ESP plan, which was initially approved on October 20, 2017 (ESP 3). On December 18, 2019, the PUCO approved AES Ohio's Notice of Withdrawal of ESP 3 and reversion to its prior rate plan (ESP 1). Among other items, the ~~fair~~PUCO ~~value~~Order approving the ESP 1 rate plan included reinstating the non-bypassable RSC Rider, which ~~may~~provided ~~not~~annual berevenue of approximately $79.0 million. The OCC has appealed to the ~~value~~Ohio ~~realized~~Supreme inCourt the ~~future.~~PUCO’s decision approving the reversion to ESP 1 as well as argued for a

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~~The~~refund ~~following~~of ~~table presents~~ the ~~fair~~RSC ~~value,~~revenue ~~carrying~~dating ~~value~~back ~~and~~to ~~cost~~August ~~of our non-derivative instruments at June 30, 2016 and December 31, 2015~~2021. ~~Information~~ ~~about~~Oral ~~the~~arguments ~~fair~~regarding ~~value~~this ofappeal ~~our~~were ~~derivative~~held ~~instruments~~on ~~can~~April be22, ~~found~~2025, inand ~~Note~~a 4court –decision ~~Derivative~~is ~~Instruments and Hedging Activities~~pending.

	June 30, 2016				December 31, 2015
$ in millions	Cost		Fair Value		Cost		Fair Value
Assets
Money market funds	$	0.3	$	0.3	$	0.2	$	0.2
Equity securities	2.7		3.5		3.0		3.8
Debt securities	4.2		4.2		4.4		4.3
Hedge funds	0.2		0.2		0.4		0.4
Real estate	0.3		0.4		0.3		0.3
Total Assets	$	7.7	$	8.6	$	8.3	$	9.0
	Carrying Value		Fair Value		Carrying Value		Fair Value
Liabilities
Debt	$	1,923.3	$	1,912.4	$	1,993.3	$	1,975.3

Smart Grid Comprehensive Settlement

~~These~~On ~~financial~~October ~~instruments~~23, ~~are~~2020, ~~not~~AES ~~subject~~Ohio entered into a Stipulation and Recommendation (the Settlement) with the staff of the PUCO, various customers and organizations representing customers of AES Ohio and certain other parties with respect to, ~~master~~among ~~netting~~other ~~agreements~~matters, orAES ~~collateral~~Ohio's ~~requirements~~applications for (i) approval of AES Ohio's plan to modernize its distribution grid (Smart Grid Phase 1), (ii) findings that DP&L passed the SEET for 2018 and as2019, ~~such~~and ~~are~~(iii) ~~presented~~findings that AES Ohio's ESP 1 satisfies the SEET and the more favorable in the ~~Condensed~~aggregate ~~Consolidated~~(MFA) ~~Balance~~regulatory ~~Sheet~~test. atOn June 16, 2021, the PUCO issued their ~~gross~~opinion ~~fair~~and ~~value~~order accepting the stipulation as filed. The OCC appealed the final PUCO order with respect to the 2018 and 2019 SEET to the Ohio Supreme Court on December 6, ~~except~~2021. ~~for~~Oral ~~Debt~~arguments regarding this appeal were held on April 2, ~~which~~2025, isand ~~presented~~a atcourt ~~amortized~~decision ~~carrying~~is ~~value~~pending.

~~Debt~~Smart Grid Phase 2 Plan

~~Unrealized~~In ~~gains~~February or2024, ~~losses~~AES ~~are~~Ohio ~~not~~filed ~~recognized~~a inSmart Grid Phase 2 with the ~~financial~~PUCO ~~statements~~proposing asa ~~debt~~ten-year isinvestment ~~presented~~plan atto ~~cost~~begin after Smart Grid Phase 1 ends. On September 13, ~~net~~2024, ofAES ~~unamortized~~Ohio ~~premium~~reached ora ~~discount~~settlement with the PUCO staff and ~~deferred~~other ~~financing~~parties ~~costs~~on inthe pending Smart Grid Phase 2 application and an evidentiary hearing was held on October 29, 2024. A fundamental premise of the Application was the continued availability of rider recovery of Smart Grid investments through the plan period. However, with the recent enactment of Sub. HB 15 described above, which prohibits AES Ohio from applying for a new electric security plan which includes certain rider recovery mechanisms, as well as the near-term financial ~~statements~~uncertainty created by the statute, AES Ohio withdrew its Smart Grid Phase 2 Application on May 23, 2025. ~~The~~ ~~debt~~On ~~amounts~~July ~~include~~9, 2025, the ~~current~~PUCO ~~portion~~approved ~~payable~~the inwithdrawal and closed the ~~next~~case. ~~twelve~~This ~~months~~withdrawal will provide AES Ohio flexibility as to the timing and ~~have~~scope ~~maturities~~of ~~that~~Smart ~~range~~Grid ~~from~~investments ~~2016~~to continue to ~~2061~~deliver benefits to customers.

~~Master~~Distribution ~~Trust~~Rate ~~Assets~~Case

~~DP&L~~2024 ~~established~~Distribution ~~Master~~Rate ~~Trusts~~Case toapplication hold assets that could be used for the benefit of employees participating in employee benefit plans and these assets are not used for general operating purposes. These assets are primarily comprised of open-ended mutual funds, which are valued using the net asset value per unit. These investments are recorded at fair value within Other deferred assets on the balance sheets and classified as available-for-sale. Any unrealized gains or losses are recorded in AOCI until the securities are sold.

~~DPL~~On ~~had~~November ~~$0.8~~29, ~~million~~2024, ~~($0.6~~AES ~~million~~Ohio ~~after~~filed ~~tax)~~a ofdistribution ~~unrealized~~rate ~~gains~~case ~~and~~with ~~immaterial~~the ~~unrealized~~PUCO. ~~losses~~The oninvestments ~~the~~reflected ~~Master~~in ~~Trust~~this ~~assets~~distribution inrate ~~AOCI~~case atinclude ~~June 30,~~investments ~~2016~~to ~~and~~enhance ~~$0.7~~the ~~million~~safety, ~~($0.5~~reliability, ~~million~~and ~~after~~resilience ~~tax)~~ of ~~unrealized~~the ~~gains~~distribution ~~and $0~~system.1 ~~million~~Among ~~($0.1~~other ~~million~~matters, ~~after tax) in unrealized losses on~~ the ~~Master~~application ~~Trust assets in AOCI at December 31, 2015.~~requests:

~~During~~•An ~~the~~increase ~~six~~to ~~months~~its ~~ended~~annual ~~June 30,~~distribution ~~2016,~~revenue ~~$2.0~~requirement ~~million~~of ($1235.3 2 million, ~~after~~which ~~tax)~~incorporates ofcertain ~~various~~ investments ~~were~~that ~~sold to facilitate the distribution of benefits and the unrealized gains were reversed into earnings. An immaterial amount of unrealized gains~~ are ~~expected~~currently torecovered bethrough ~~reversed to earnings as investments are sold over~~ the ~~next~~Distribution ~~twelve~~Investment ~~months~~Rider; ~~to facilitate the distribution of benefits.~~

~~Fair~~•A ~~Value~~return ~~Hierarchy~~on equity of 10.95% and a cost of long-term debt of 4.49% on a distribution rate base of $1.3 billion and based on a capital structure of 53.87% equity and 46.13% long-term debt; and

~~Fair~~•A value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date~~. The~~ ~~fair~~certain ~~value hierarchy requires an entity to maximize the use~~ of ~~observable~~September ~~inputs~~30, 2024 and ~~minimize~~a ~~the~~test ~~use~~period of ~~unobservable~~June ~~inputs~~1, ~~when~~2024 ~~measuring~~– ~~fair~~May ~~value. These~~31, ~~inputs are then categorized as:~~ 2025

•The ~~Level~~rate 1case ~~(quoted~~application ~~prices~~also inincludes ~~active~~a ~~markets~~proposal for ~~identical~~increased ~~assets~~tree-trimming orexpenses. ~~liabilities)~~On June 27, 2025, the PUCO Staff submitted their Report and Recommendations; the PUCO has set the evidentiary hearing to begin September 9, 2025 and public hearings to be held on August 7 and August 14, 2025.

•Tax ~~Level~~Savings 2Credit ~~(observable inputs such as quoted prices for similar assets or liabilities or quoted prices in markets that are not active);~~Rider

•As ~~Level~~a 3result ~~(unobservable~~of ~~inputs~~the TCJA and the resulting decrease of the federal corporate income tax rate, AES Ohio established a Tax Savings Credit Rider (TSCR) for the purpose of returning certain benefits of the TCJA to customers, which was approved by the PUCO in 2018 as part of a stipulation adopted by the PUCO in AES Ohio’s 2015 Distribution Rate Case. In November 2024, AES Ohio filed an application to update the TSCR to address an inadvertent normalization violation identified by the Company. On July 9, 2025, the PUCO approved AES Ohio’s application to update its TSCR to correct the inadvertent normalization violation through collection of $13.6 million from customers over twelve months, which will be effective in August 2025.

3. FAIR VALUE

The fair value of our financial assets and liabilities approximates their reported carrying amounts. The estimated fair values of our assets and liabilities have been determined using available market information. Because these

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~~Valuations~~amounts ofare ~~assets~~estimates and ~~liabilities~~based ~~reflect~~on hypothetical transactions to sell assets or transfer liabilities, the ~~value~~use of ~~the~~different ~~instrument~~market ~~including~~assumptions ~~the~~and/or ~~values~~estimation ~~associated~~methodologies ~~with~~may ~~counterparty~~have ~~risk. We~~a ~~include~~material ~~our~~effect ~~own~~on ~~credit~~the ~~risk~~estimated ~~and~~fair ~~our~~value ~~counterparty’s~~amounts. ~~credit~~For ~~risk~~further ininformation on our ~~calculation~~valuation oftechniques ~~fair~~and ~~value~~policies, ~~using~~see ~~global~~Note ~~average~~4. ~~default~~Fair ~~rates~~Value ~~based~~in onItem an8. ~~annual~~– ~~study~~Financial ~~conducted~~Statements byand aSupplementary ~~large~~Data ~~rating~~of ~~agency~~our Form 10-K.

WeFinancial ~~did not have any transfers of the fair values of our financial instruments between Level 1 and Level 2 of the fair value hierarchy during the six months ended June 30, 2016 and 2015.~~Assets

~~The~~AES ~~fair~~Ohio ~~value~~established a Master Trust to hold assets that could be used for the benefit of employees participating in employee benefit plans. These assets ~~and~~are ~~liabilities~~not atused ~~June 30,~~for ~~2016~~general ~~and~~operating ~~December 31~~purposes. These assets are primarily comprised of open-ended mutual funds, ~~2015~~which ~~and~~are valued using the ~~respective~~net ~~category~~asset ~~within~~value ~~the~~per unit. These assets are recorded at fair value ~~hierarchy~~within ~~for~~Other ~~DPL~~non-current ~~was~~assets ~~determined~~on the Condensed Balance Sheets and are classified as equity investments. Net unrealized gains related to equity investments still held as of June 30, 2025 and 2024 are as follows:

Assets and Liabilities at Fair Value
			Three months ended								Six months ended
			Level 1		Level 2				Level 3
			June 30,								June 30,
$ in millions	~~Fair value at June 30, 2016~~		~~Based on Quoted Prices in Active Markets~~2025		~~Other Observable Inputs~~		2024		~~Unobservable Inputs~~		2025		2024
Assets
Net unrealized gains (a)			$	0.3			$	—			$	0.2	$	0.3
Master Trust assets
Money market funds	$	0.3	$	0.3	$	—			$	—
Equity securities	3.5		—		3.5				—
Debt securities	4.2		—		4.2				—
Hedge funds	0.2		—		0.2				—
Real estate	0.4		—		0.4				—
Total Master Trust assets	8.6		0.3		8.3				—
Derivative Assets
FTRs	0.1		—		—				0.1
Natural gas futures	0.3		0.3		—				—
Forward power contracts	39.3		—		38.6				0.7
Total Derivative assets	39.7		0.3		38.6				0.8
Total Assets	$	48.3	$	0.6	$	46.9			$	0.8
Liabilities
Derivative Liabilities
Forward power contracts	45.2		—		38.9				6.3
Total Derivative liabilities	45.2		—		38.9				6.3
Debt	1,912.4		—		1,894.4				18.0
Total Liabilities	$	1,957.6	$	—	$	1,933.3			$	24.3

(a) These amounts are included in Other income / (expense), net in our Condensed Statements of Operations.

We did not have any transfers of the fair values of our financial instruments between Level 1, Level 2 or Level 3 of the fair value hierarchy during the six months ended June 30, 2025 or 2024.

Recurring Fair Value Measurements

The fair value of assets and liabilities as of June 30, 2025 and December 31, 2024 measured on a recurring basis and the respective category within the fair value hierarchy for AES Ohio is as follows:


	Fair value as of June 30, 2025								Fair value as of December 31, 2024
$ in millions	Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
Assets
Master Trust assets
Money market funds	$	0.6	$	—	$	—	$	0.6	$	0.4	$	—	$	—	$	0.4
Mutual funds	7.2		—		—		7.2		7.6		—		—		7.6










Total assets	$	7.8	$	—	$	—	$	7.8	$	8.0	$	—	$	—	$	8.0

Financial Instruments not Measured at Fair Value in the Condensed Balance Sheets

The fair value of long-term debt is based on current public market prices for disclosure purposes only. These fair value inputs are considered Level 2 in the fair value hierarchy. As the Wright-Patterson Air Force Base note is not publicly traded, the fair value inputs are considered Level 3 in the fair value hierarchy as there are no observable inputs. Unrealized gains or losses are not recognized in the financial statements as long-term debt is presented at carrying value, net of unamortized premium or discount and unamortized deferred financing costs. The long-term debt amounts include the current portion payable in the next twelve months and have maturities that range from 2027 to 2061. Additional Level 3 disclosures are not presented since our long-term debt is not recorded at fair value.

The following table presents the carrying amount, fair value, and fair value hierarchy of our financial liabilities that are not measured at fair value in the Condensed Balance Sheets as of the periods indicated, but for which fair value is disclosed:


	June 30, 2025										December 31, 2024
	Carrying Amount		Fair Value								Carrying Amount		Fair Value
$ in millions			Level 1		Level 2		Level 3		Total				Level 1		Level 2		Level 3		Total
Liabilities
Long-term debt	$	1,013.1	$	—	$	897.9	$	16.5	$	914.4	$	1,012.9	$	—	$	894.8	$	16.6	$	911.4

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Assets and Liabilities at Fair Value
			Level 1		Level 2		Level 3
$ in millions	Fair value at December 31, 2015		Based on Quoted Prices in Active Markets		Other Observable Inputs		Unobservable Inputs
Assets
Master Trust assets
Money market funds	$	0.2	$	0.2	$	—	$	—
Equity securities	3.8		—		3.8		—
Debt securities	4.3		—		4.3		—
Hedge funds	0.4		—		0.4		—
Real estate	0.3		—		0.3		—
Total Master Trust assets	9.0		0.2		8.8		—
Derivative assets
Forward power contracts	30.5		—		30.5		—
FTRs	0.2		—		—		0.2
Total Derivative assets	30.7		—		30.5		0.2
Total Assets	$	39.7	$	0.2	$	39.3	$	0.2
Liabilities
Derivative liabilities
FTRs	$	0.5	$	—	$	—	0.5
Forward power contracts	27.0		—		23.9		3.1
Total Derivative liabilities	27.5		—		23.9		3.6
Debt	1,975.3		—		1,957.2		18.1
Total Liabilities	$	2,002.8	$	—	$	1,981.1	$	21.7

4. DEBT

~~Our~~Long-term ~~financial~~debt ~~instruments~~is ~~are~~as ~~valued using the market approach in the following categories~~follows:

• Level 1 inputs are used for derivative contracts such as heating oil futures, natural gas futures and for money market accounts that are considered cash equivalents. The fair value is determined by reference to quoted market prices and other relevant information generated by market transactions.


	Interest			June 30,		December 31,
$ in millions	Rate		Due	2025		2024
First Mortgage Bonds	3.95	%	2049	$	425.0	$	425.0
First Mortgage Bonds	3.20	%	2040	140.0		140.0
First Mortgage Bonds	5.70	%	2033	107.5		107.5
First Mortgage Bonds	5.19	%	2033	100.0		100.0
First Mortgage Bonds	5.49	%	2028	92.5		92.5
Tax-exempt First Mortgage Bonds (a)	4.25	%	2027	100.0		100.0
Tax-exempt First Mortgage Bonds (b)	4.00	%	2027	40.0		40.0
U.S. Government note	4.20	%	2061	16.5		16.6
Unamortized deferred financing costs				(6.2)		(6.6)
Unamortized debt discounts				(2.2)		(2.1)
Total long-term debt				1,013.1		1,012.9
Less: current portion				(0.2)		(0.2)
Long-term debt, net of current portion				$	1,012.9	$	1,012.7

•(a)First ~~Level~~mortgage 2bonds ~~inputs~~issued ~~are used~~ to ~~value~~the ~~derivatives~~OAQDA, ~~such~~to assecure ~~forward power contracts (which are traded on~~ the ~~OTC~~loan ~~market~~of ~~but~~proceeds ~~which~~from ~~are~~tax-exempt ~~valued~~bonds ~~using~~issued ~~prices~~by on the ~~NYMEX for similar contracts on the OTC market)~~OAQDA. ~~Other~~The ~~Level~~bonds 2have ~~assets~~a ~~include~~final ~~open-ended~~maturity ~~mutual~~date ~~funds~~of ~~that~~November ~~are in the Master Trust~~1, ~~which~~2040 but are ~~valued~~subject ~~using~~to ~~observable~~a ~~prices~~mandatory ~~based~~put onin ~~the~~June ~~end of day net asset value per unit~~2027.

•(b)First ~~Level~~mortgage 3bonds ~~inputs~~issued ~~such~~to asthe ~~FTRs~~OAQDA, ~~are~~to ~~considered~~secure athe ~~Level~~loan 3of ~~input~~proceeds ~~because~~from ~~the~~tax-exempt ~~monthly~~bonds ~~auctions~~issued ~~are~~by ~~considered~~the ~~inactive~~OAQDA. ~~Other~~The ~~Level~~bonds 3have ~~inputs~~a ~~include~~final ~~the~~maturity ~~credit~~date ~~valuation adjustment on some~~ of ~~the~~January ~~forward~~1, ~~power~~2034 ~~contracts~~but ~~and forward power contracts in less active markets. Our Level 3 inputs~~ are ~~immaterial~~subject to ~~our derivative balances as~~ a ~~whole~~mandatory ~~and~~put asin ~~such~~June ~~no further disclosures are presented~~2027.

~~Approximately~~Revolving ~~93%~~Credit ~~of the inputs to the fair value of our derivative instruments are from quoted market prices.~~ Agreement

~~Our~~AES ~~debt~~Ohio isentered ~~fair~~into ~~valued~~a ~~for~~third ~~disclosure~~amendment ~~purposes~~and ~~only~~restatement ~~and~~of ~~most~~its $350 million revolving Credit Agreement on March 25, 2025 with a syndicate of ~~the~~bank ~~fair~~lenders. ~~values~~The ~~are~~AES ~~determined~~Ohio ~~using~~Credit ~~quoted~~Agreement ~~market~~is ~~prices~~an inunsecured ~~inactive~~committed ~~markets~~line of credit to be used: (i) to finance capital expenditures; (ii) to refinance certain existing indebtedness, (iii) to support working capital; and (iv) for general corporate purposes. ~~These~~ ~~fair~~This ~~value~~agreement ~~inputs~~matures ~~are~~on ~~considered~~March ~~Level~~25, 22030, and bears interest at variable rates as described in the ~~fair~~agreement. ~~value~~It ~~hierarchy~~includes an uncommitted $150. As0 million accordion feature to provide AES Ohio with an option to request an increase in the ~~Wright-Patterson~~size ~~Air~~of ~~Force~~the ~~Base~~facility ~~loan~~at isany ~~not~~time ~~publicly~~prior ~~traded,~~to ~~fair~~March ~~value~~25, is2029, ~~assumed~~subject to ~~equal~~approval ~~carrying~~by ~~value~~the lenders. ~~These~~ ~~fair~~The ~~value~~AES ~~inputs~~Ohio ~~are~~Credit ~~considered~~Agreement ~~Level~~also 3includes intwo ~~the~~one-year ~~fair~~extension ~~value~~options, ~~hierarchy~~allowing asAES ~~there~~Ohio ~~are~~to noextend ~~observable~~the ~~inputs~~maturity date subject to approval by the lenders. ~~Additional~~ ~~Level~~As 3of ~~disclosures~~June 30, ~~are~~2025 ~~not~~and ~~presented~~December 31, ~~since~~2024, ~~debt~~the isAES ~~not~~Ohio ~~recorded~~Credit atAgreement ~~fair~~had ~~value~~outstanding borrowings of $160.0 million and $140.0 million, respectively.

~~Non-recurring~~Term ~~Fair~~Loan ~~Value~~Agreement ~~Measurements~~

WeIn ~~use~~August ~~the~~2024, ~~cost~~AES ~~approach~~Ohio toentered ~~determine~~into ~~the~~an ~~fair~~unsecured ~~value~~$150.0 million of364-day ~~our~~term ~~AROs~~loan agreement, which iswas ~~estimated~~fully bydrawn ~~discounting~~at ~~expected~~closing ~~cash~~with ~~outflows~~the proceeds being used for general corporate purposes. The AES Ohio Term Loan Agreement was originally set to ~~their~~mature ~~present~~on ~~value~~August 13, 2025, but was amended on July 30, 2025, to mature on October 13, 2025, and bears interest at ~~the~~variable ~~initial~~rates ~~recording~~as ofdescribed in the ~~liability~~agreement. ~~Cash~~ ~~outflows~~The ~~are~~AES ~~based~~Ohio onTerm Loan Agreement contains customary representations, warranties and covenants, including a leverage covenant consistent with the ~~approximate~~leverage ~~future~~covenant ~~disposal~~contained ~~cost~~in asAES ~~determined~~Ohio's byCredit ~~market~~Agreement. ~~information,~~AES ~~historical~~Ohio ~~information~~has orclassified ~~other~~this ~~management~~agreement ~~estimates~~as short-term indebtedness as it matures in October 2025. ~~These~~ ~~inputs~~Management plans to repay the ~~fair~~AES ~~value~~Ohio ofTerm ~~the~~Loan ~~AROs~~Agreement ~~would~~through bea ~~considered~~combination ~~Level~~of 3cash ~~inputs~~from ~~under~~operations, ~~the~~new ~~fair~~debt, ~~value~~and equity capital contributions.

Long-term debt covenants and restrictions

The AES Ohio Credit Agreement, AES Ohio Term Loan Agreement, and Fifty-Third, Fifty-Fourth and Fifty-Fifth Supplemental Indentures to the First Mortgage, pursuant to which the 3.20% Bonds due 2040, the 5.19% Bonds due 2033, the 5.49% Bonds due 2028 and the 5.70% Bonds due 2033 were issued, respectively, each contain one financial covenant. The covenant measures Total Debt to Total Capitalization and is calculated, at the end of each fiscal quarter, by dividing total debt at the end of the quarter by total capitalization at the end of the quarter. AES Ohio’s Total Debt to Total Capitalization ratio shall not be greater than 0.67 to 1.00. As of June 30, 2025, AES Ohio was in compliance with this financial covenant.

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~~hierarchy. AROs~~AES ~~for~~Ohio ~~ash~~does ~~ponds,~~not ~~asbestos,~~have ~~river~~any ~~structures~~meaningful ~~and~~restrictions ~~underground~~in ~~storage~~its ~~tanks~~debt ~~increased~~financing bydocuments aprohibiting ~~net~~dividends ~~amount~~and return of ~~$2.3~~capital ~~million~~payments ~~and~~to ~~increased~~its byparent. aAs ~~net~~of ~~amount~~June 30, of2025, ~~$39.8~~AES ~~million~~Ohio ~~during~~was ~~the~~in ~~six~~compliance ~~months~~with ~~ended~~all ~~June 30~~debt covenants, ~~2016~~including ~~and~~the ~~2015,~~financial ~~respectively~~covenant described above.

~~When~~Substantially ~~evaluating~~all ~~impairment of long-lived assets~~property, weplant ~~measure~~and ~~fair~~equipment ~~value~~of ~~using~~AES ~~the~~Ohio ~~applicable fair value measurement guidance. Impairment expense~~ is ~~measured~~subject byto ~~comparing~~ the ~~fair~~lien ~~value~~of at the ~~evaluation~~mortgage ~~date~~securing toAES ~~the~~Ohio’s ~~carrying~~First ~~amount. The following table summarizes Long-lived assets measured at fair value on a non-recurring basis during the period~~ and ~~their~~Refunding ~~level within the fair value hierarchy (there were no impairments during the six months ended June 30, 2015):~~Mortgage.

$ in millions	Six months ended June 30, 2016
	Carrying		Fair Value						Gross
	Amount (b)		Level 1		Level 2		Level 3		Loss
Assets
Long-lived assets (a)
DP&L (Killen)	$	315.1	$	—	$	—	$	84.3	$	230.8
DP&L (peaking facilities)	$	9.9	$	—	$	—	$	5.2	$	4.7

5. INCOME TAXES

~~(a)See~~AES ~~Note~~Ohio's 12provision –for ~~Fixed-asset~~income ~~Impairment~~taxes ~~for~~is ~~further~~based ~~information~~on the estimated annual effective tax rate, plus discrete items. The effective combined state and federal income tax rates were as follows:

(b)Carrying amount at date of valuation


	Three months ended				Six months ended
	June 30,				June 30,
	2025		2024		2025		2024
Effective combined state and federal income tax rates	42.1	%	20.1	%	26.0	%	19.9	%

The ~~following~~year-to-date ~~summarizes~~rate is different from the ~~significant~~combined ~~unobservable~~federal ~~inputs~~and ~~used~~state instatutory rate of 22.4% primarily due to the ~~Level~~amortization 3of ~~measurement~~a onmunicipal tax shortage, partially offset by the flowthrough of a ~~non-recurring~~net ~~basis~~tax ~~during~~benefit related to the ~~six~~reversal ~~months~~of ~~ended~~excess ~~June 30,~~deferred ~~2016:~~taxes.

$ in millions	Fair value		Valuation technique	Unobservable input	Range (weighted average)
Long-lived assets held and used:
DP&L (Killen)	$	84.3	Discounted cash flow	Annual revenue growth	-11% to 13% (2%)
				Annual pre-tax operating margin	-50% to 67% (6%)
				Weighted-average cost of capital	11%
DP&L (peaking facilities)	$	5.2	Discounted cash flow	Annual revenue growth	-22% to 17% (-3%)
				Annual pre-tax operating margin	-29% to 24% (-4%)
				Weighted-average cost of capital	7%

AES Ohio's income tax expense for the six months ended June 30, 2025 was calculated using the estimated annual effective income tax rate for 2025 of 25.8% on ordinary income. Management estimates the annual effective tax rate based on its forecast of annual pre-tax income or loss. Starting in the third quarter of 2025, the annual effective tax rate is expected to increase due to the flowthrough tax expense associated with the PUCO Order on the Tax Savings Credit Rider issued on July 9, 2025.

~~Note~~AES 4files –federal ~~Derivative~~and ~~Instruments~~state income tax returns, which consolidate AES Ohio. Under a tax sharing agreement with Ohio Investments, AES Ohio is responsible for the income taxes associated with its own taxable income and ~~Hedging~~records ~~Activities~~the provision for income taxes using a separate return method.

~~In the normal course of business, DPL enters into various financial arrangements, including derivative financial instruments~~6. We ~~use~~BENEFIT derivatives principally to manage the risk of changes in market prices for commodities. The derivatives that we use to economically hedge these risks are governed by our risk management policies for forward and futures contracts. Our net positions are continually assessed within our structured hedging programs to determine whether new or offsetting transactions are required. The objective of the hedging program is to mitigate financial risks while ensuring that we have adequate resources to meet our requirements. We monitor and value derivative positions monthly as part of our risk management processes. We use published sources for pricing, when possible, to mark positions to market. All of our derivative instruments are used for risk management purposes and are designated as normal purchase/normal sale, cash flow hedges or marked to market each reporting period.PLANS

The amounts presented in the following tables for pension include both of the Pension Plans. The pension costs below have not been adjusted for amounts billed to the Service Company for former AES Ohio employees who are now employed by the Service Company or other AES affiliates or for amounts billed to AES Ohio Generation for former employees that were employed by AES Ohio Generation that are still participants in the AES Ohio plans.

The following table presents the net periodic benefit cost of the Pension Plans for the three and six months ended June 30, 2025 and 2024:


	Three months ended				Six months ended
	June 30,				June 30,
$ in millions	2025		2024		2025		2024
Service cost	$	0.5	$	0.6	$	1.1	$	1.2
Interest cost	3.7		3.7		7.3		7.4
Expected return on plan assets	(4.0)		(3.7)		(7.9)		(7.4)
Amortization of unrecognized:
Prior service cost	0.3		0.2		0.5		0.4
Actuarial loss	1.2		1.0		2.5		2.0
Net periodic benefit cost	$	1.7	$	1.8	$	3.5	$	3.6

The components of net periodic benefit cost other than service cost are included in Other income / (expense), net in the Condensed Statements of Operations.

There were $7.5 million in employer contributions during the six month periods ended June 30, 2025 and June 30, 2024, respectively.

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AtIn ~~June 30~~addition, ~~2016~~AES Ohio provides postretirement health care and life insurance benefits to certain retired employees, ~~DPL~~their ~~had~~spouses and eligible dependents. We have funded a portion of the ~~following~~union-eligible ~~outstanding~~benefits ~~derivative~~using ~~instruments:~~a Voluntary Employee Beneficiary Association Trust. These postretirement health care benefits and the related unfunded obligation were not material to the financial statements in the periods covered by this report.

Commodity	Accounting Treatment	Unit	Purchases(in thousands)	Sales(in thousands)		Net Purchases/ (Sales)(in thousands)
FTRs	Not designated	MWh	2.5	—		2.5
Natural Gas Futures	Not designated	Dths	1,442.5	—		1,442.5
Forward power contracts	Designated	MWh	692.6	(13,380.2	)	(12,687.6	)
Forward power contracts	Not designated	MWh	4,018.0	(3,537.9	)	480.1

7. SHAREHOLDER'S EQUITY

AtDuring ~~December~~the six months ended June 3130, ~~2015~~2025, ~~DPL~~Ohio ~~had~~Holdings ~~the~~made ~~following~~equity ~~outstanding~~contributions ~~derivative~~of ~~instruments:~~$150.0 million to AES Ohio.

Commodity	Accounting Treatment	Unit	Purchases(in thousands)	Sales(in thousands)		Net Purchases/ (Sales)(in thousands)
FTRs	Not designated	MWh	10.2	—		10.2
Forward power contracts	Designated	MWh	1,676.7	(7,795.8	)	(6,119.1	)
Forward power contracts	Not designated	MWh	5,049.9	(1,663.0	)	3,386.9

During the six months ended June 30, 2024, DPL made equity contributions of $130.0 million to AES Ohio.

~~Cash~~The ~~Flow~~proceeds ~~Hedges~~from these equity contributions are intended primarily for funding needs related to AES Ohio’s capital expenditure program.

As part of our risk management processes, we identify the relationships between hedging instruments and hedged items, as well as the risk management objective and strategy for undertaking various hedge transactions8. ~~The~~ ~~fair~~COMMITMENTS ~~value~~AND of cash flow hedges is determined by observable market prices available as of the balance sheet dates and will continue to fluctuate with changes in market prices up to contract expiration. The effective portion of the hedging transaction is recognized in AOCI and transferred to earnings using specific identification of each contract when the forecasted hedged transaction takes place or when the forecasted hedged transaction is probable of not occurring. The ineffective portion of the cash flow hedge is recognized in earnings in the current period. All risk components were taken into account to determine the hedge effectiveness of the cash flow hedges.CONTINGENCIES

We enter into forward power contracts to manage commodity price risk exposure related to our generation of electricity. We do not hedge all commodity price risk. We reclassify gains and losses on forward power contracts from AOCI into earnings in those periods in which the contracts settle.Contingencies

Legal Matters

In the normal course of business, we are subject to various lawsuits, actions, proceedings, claims and other matters asserted under various laws and regulations. We believe the amounts provided in our Condensed Financial Statements, as prescribed by GAAP, are adequate considering the probable and estimable contingencies. However, there can be no assurances that the actual amounts required to satisfy alleged liabilities from various legal proceedings, claims, tax examinations and other matters discussed below, and to comply with applicable laws and regulations, will not exceed the amounts reflected in our Condensed Financial Statements. As such, costs, if any, that may be incurred in excess of those amounts provided as of June 30, 2025, cannot be reasonably determined.

Environmental Matters

We are subject to various federal, state, regional and local environmental protection and health and safety laws and regulations governing, among other things, the generation, storage, handling, use, disposal and transportation of regulated materials, including ash; the use and discharge of water used in generation boilers and for cooling purposes; the emission and discharge of hazardous and other materials, including GHGs, into the environment; climate change; species and habitat protections; and the health and safety of our employees. These laws and regulations often require a lengthy and complex process of obtaining and renewing permits and other governmental authorizations from federal, state and local agencies. Violation of these laws, regulations or permits can result in substantial fines, other sanctions, suspension or revocation of permits and/or facility shutdowns. There can be no assurance that we have been or will be at all times in full compliance with such laws, regulations and permits.

Where no accrued liability has been recognized, it is reasonably possible that some matters could have unfavorable outcomes for us and could require us to pay damages or make expenditures in amounts that could be material but could not be estimated as of June 30, 2025.

We have taken steps to limit our exposure to environmental claims that could be raised with respect to our previously-owned and operated coal-fired generation units, but we cannot predict whether any such claims will be raised and, if they are, the extent to which they may have a material adverse effect on our results of operations, financial condition and cash flows.

Accruals for legal loss and environmental contingencies were not material as of June 30, 2025 and December 31, 2024.

Equity Ownership Interest

AES Ohio has a 4.9% equity ownership interest in OVEC, which is recorded using the cost method of accounting under GAAP. AES Ohio, along with several non-affiliated energy companies party to an OVEC arrangement, receive and pay for OVEC capacity and energy and are responsible for OVEC debt obligations and other fixed costs in proportion to their power participation ratios under the arrangement, which, for AES Ohio, is the same as its equity ownership interest. As of June 30, 2025, AES Ohio could be responsible for the repayment of 4.9%, or $44.0 million, of $898.0 million OVEC debt obligations if they came due, comprised of fixed rate securities with maturities from

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~~The~~2026 ~~following~~to ~~table~~2040. ~~provides~~OVEC ~~information~~could ~~for~~also ~~DPL~~seek ~~concerning~~additional ~~gains~~contributions orfrom ~~losses~~AES ~~recognized~~Ohio into ~~AOCI~~avoid ~~for~~a ~~the~~default ~~cash~~in ~~flow~~the ~~hedges~~event ~~for~~that ~~the~~other ~~three~~OVEC ~~and~~members ~~six~~defaulted ~~months~~on ~~ended~~their ~~June 30,~~respective ~~2016~~OVEC ~~and 2015:~~obligations.

	Three months ended						Three months ended
	June 30, 2016						June 30, 2015
				Interest						Interest
$ in millions (net of tax)	Power			Rate Hedge			Power			Rate Hedge
Beginning accumulated derivative gains in AOCI	$	22.5		$	17.5		$	1.0		$	18.2
Net gains / (losses) associated with current period hedging transactions	(8.5		)	—			1.7			—
Net gains / (losses) reclassified to earnings
Interest expense	—			(0.2		)	—			(0.4		)
Revenues	(13.0		)	—			(1.9		)	—
Purchased power	2.4			—			0.3			—
Ending accumulated derivative gains in AOCI	$	3.4		$	17.3		$	1.1		$	17.8
	Six months ended						Six months ended
	June 30, 2016						June 30, 2015
				Interest						Interest
$ in millions (net of tax)	Power			Rate Hedge			Power			Rate Hedge
Beginning accumulated derivative gains in AOCI	$	9.2		$	17.5		$	0.2		$	18.3
Net gains associated with current period hedging transactions	13.0			—			1.8			—
Net gains / (losses) reclassified to earnings
Interest expense	—			(0.2		)	—			(0.5		)
Revenues	(24.0		)	—			(2.1		)	—
Purchased power	5.2			—			1.2			—
Ending accumulated derivative gains in AOCI	$	3.4		$	17.3		$	1.1		$	17.8
Portion expected to be reclassified to earnings in the next twelve months (a)	$	(3.1	)	$	(0.6	)
Maximum length of time that we are hedging our exposure to variability in future cash flows related to forecasted transactions (in months)	18			0

9. BUSINESS SEGMENTS

~~(a)The~~Operating ~~actual~~segments ~~amounts~~are components of an enterprise that weengage ~~reclassify~~in business activities from ~~AOCI~~which toit ~~earnings~~may ~~related~~earn torevenue ~~power~~and ~~can~~incur ~~differ~~expenses, ~~from~~for which separate financial information is available, and is evaluated regularly by the ~~estimate~~chief ~~above~~operating ~~due~~decision maker in assessing performance and deciding how to ~~market~~allocate ~~price~~resources. ~~changes~~All of AES Ohio’s current business consists of the transmission, distribution and sale of electric energy, and therefore AES Ohio had only one reportable segment, led by our Chief Executive Officer and Chief Financial Officer, who, collectively, are the Chief Operating Decision Maker. The primary segment performance measures are income / (loss) before income tax and net income / (loss) as management has concluded that these measures best reflect the underlying business performance of AES Ohio and are the most relevant measures considered in AES Ohio's internal evaluation of the financial performance of its segment. See Note 1, "Overview and Summary of Significant Accounting Policies" for further information on AES Ohio.

~~Derivatives~~The ~~not~~following ~~designated~~tables aspresent ~~hedges~~financial information for AES Ohio’s reportable business segment:

Certain derivative contracts are entered into on a regular basis as part of our risk management program but do not qualify for hedge accounting or the normal purchase and sales exceptions under FASC 815. Accordingly, such contracts are recorded at fair value with changes in the fair value charged or credited to the Condensed Consolidated Statements of Operations in the period in which the change occurred. This is commonly referred to as “MTM accounting.” Contracts we enter into as part of our risk management program may be settled financially, by physical delivery, or net settled with the counterparty. FTRs, heating oil futures, natural gas, and certain forward power contracts are currently marked to market.


	Three months ended				Six months ended
	June 30,				June 30,
$ in millions	2025		2024		2025		2024
Revenue	$	227.6	$	206.9	$	479.7	$	431.2

Net purchased power	82.5		69.2		177.3		158.7
Operation and maintenance	64.8		60.8		128.7		121.5
Depreciation and amortization	29.0		20.7		57.8		42.8
Taxes other than income taxes	27.7		26.9		63.9		56.1




Interest expense	13.7		11.7		28.4		22.9


Other segment items (a)	0.4		(1.3)		1.7		(1.4)
Income before income tax	9.5		18.9		21.9		30.6
Income tax expense / (benefit)	4.0		3.8		5.7		6.1
Net income / (loss)	$	5.5	$	15.1	$	16.2	$	24.5

Capital expenditures	72.2		115.0		$	157.5	$	288.1

					June 30, 2025		December 31, 2024
Total assets					$	3,462.6	$	3,355.2

~~Certain~~(a) Other ~~qualifying~~segment ~~derivative~~items ~~instruments~~primarily ~~have~~includes ~~been~~other ~~designated~~miscellaneous asgains ~~normal purchases or normal sales contracts, as provided under GAAP. Derivative contracts that have been designated as normal purchases or normal sales under GAAP are not subject to MTM accounting~~ and ~~are~~losses ~~recognized~~ in ~~the~~Other ~~Condensed~~income ~~Consolidated~~/ ~~Statements~~(expense), ~~of Operations on an accrual basis~~net.

10. REVENUE

Revenue is primarily earned from retail and wholesale electricity sales and electricity transmission and distribution delivery services. Revenue is recognized upon transfer of control to customers in an amount that reflects the consideration to which we expect to be entitled in exchange for those goods or services. Revenue is recorded net of any taxes assessed on and collected from customers, which are remitted to the governmental authorities. For further discussion of our Retail, Wholesale, RTO ancillary, and Capacity revenue, see Note 12. Revenue in Item 8. Financial Statements and Supplementary Data of our Form 10-K.

AES Ohio's revenue from contracts with customers was as follows:


	Three months ended				Six months ended
	June 30,				June 30,
$ in millions	2025		2024		2025		2024
Revenue from contracts with customers	$	223.0	$	204.2	$	471.6	$	426.1

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~~Regulatory~~The ~~Assets~~following table presents our revenue from contracts with customers and ~~Liabilities~~other revenue for the three and six months ended June 30, 2025 and 2024:

In accordance with regulatory accounting under GAAP, a cost or loss that is probable of recovery in future rates should be deferred as a regulatory asset and revenue or a gain that is probable of being returned to customers should be deferred as a regulatory liability. Therefore, a portion of the heating oil futures are assigned to the retail jurisdiction and deferred as a regulatory asset or liability until the contracts settle. If these unrealized gains and losses are no longer deemed to be probable of recovery through our rates, they will be reclassified into earnings in the period such determination is made. Beginning January 1, 2016, we no longer assign any portion of the heating oil futures to our retail jurisdiction as all of our SSO retail sales are sourced through the competitive bid process.


	Three months ended				Six months ended
	June 30,				June 30,
$ in millions	2025		2024		2025		2024
Retail revenue
Retail revenue from contracts with customers
Residential revenue	$	105.7	$	101.9	$	242.4	$	226.2
Commercial revenue	44.0		39.4		83.8		78.6
Industrial revenue	18.1		16.0		33.8		32.7
Governmental revenue	7.2		6.3		14.2		12.1
Other (a)	2.7		3.3		5.0		6.3
Total retail revenue from contracts with customers	177.7		166.9		379.2		355.9

Wholesale revenue
Wholesale revenue from contracts with customers	5.3		2.8		14.5		7.8
RTO ancillary revenue	39.2		34.2		76.8		62.0
Capacity revenue	0.8		0.3		1.1		0.4

Miscellaneous revenue	4.6		2.7		8.1		5.1

Total revenue	$	227.6	$	206.9	$	479.7	$	431.2

~~The~~(a) "Other" ~~following~~primarily ~~tables~~includes ~~present~~operation ~~the amount~~ and ~~classification~~maintenance ~~within~~service ~~the~~revenue, ~~Condensed~~billing ~~Consolidated~~service ~~Statements~~fees offrom ~~Operations~~CRES orproviders ~~Condensed Consolidated Balance Sheets of the gains~~ and ~~losses~~other onmiscellaneous ~~DPL’s~~retail ~~derivatives~~revenue ~~not~~from ~~designated~~contracts aswith ~~hedging~~customers. ~~instruments for the three and six months ended June 30, 2016 and 2015:~~

For the three months ended June 30, 2016
$ in millions	FTRs		Power			Natural Gas		Total
Change in unrealized gain	$	0.2	$	2.6		$	0.5	$	3.3
Realized gain / (loss)	0.2		(2.4		)	0.7		(1.5		)
Total	$	0.4	$	0.2		$	1.2	$	1.8
Recorded in Income Statement: gain / (loss)
Revenues	$	—	$	(5.3	)	$	—	$	(5.3	)
Purchased power	0.4		5.5			1.2		7.1
Total	$	0.4	$	0.2		$	1.2	$	1.8

The balances of receivables from customers were as follows:

For the three months ended June 30, 2015
$ in millions				June 30, 2025					December 31, 2024
$ in millions	Heating Oil			FTRs			Power				Total
Receivables from contracts with customers				$	129.0				$	103.1
Change in unrealized gain / (loss)	$	0.1		$	(0.8	)	$	1.2			$	0.5
Realized loss	(0.1		)	—			(1.5		)		(1.6		)
Total	$	—		$	(0.8	)	$	(0.3	)		$	(1.1	)
Recorded in Income Statement: gain / (loss)
Revenues	$	—		$	(0.8	)	$	(2.8	)		$	(3.6	)
Purchased power	—			—			2.5				2.5
Total	$	—		$	(0.8	)	$	(0.3	)		$	(1.1	)

For the six months ended June 30, 2016
$ in millions	FTRs		Power			Natural Gas		Total
Change in unrealized gain	$	0.4	$	1.2		$	0.3	$	1.9
Realized gain / (loss)	0.4		(2.9		)	0.5		(2.0		)
Total	$	0.8	$	(1.7	)	$	0.8	$	(0.1	)
Recorded in Income Statement: gain / (loss)
Revenues	$	—	$	(6.6	)	$	—	$	(6.6	)
Purchased power	0.8		4.9			0.8		6.5
Total	$	0.8	$	(1.7	)	$	0.8	$	(0.1	)

Payment terms for all receivables from contracts with customers are typically within 30 days unless a customer qualifies for payment extension.

~~Table~~ITEM of2. ~~Contents~~MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

For the six months ended June 30, 2015
$ in millions	Heating Oil			FTRs			Power			Natural Gas			Total
Change in unrealized gain / (loss)	$	0.2		$	0.1		$	(1.7	)	$	0.1		$	(1.3	)
Realized loss	(0.1		)	(0.1		)	(3.8		)	(0.1		)	(4.1		)
Total	$	0.1		$	—		$	(5.5	)	$	—		$	(5.4	)
Recorded on Balance Sheet: gain
Regulatory asset	$	0.1		$	—		$	—		$	—		$	0.1
Recorded in Income Statement: gain / (loss)
Revenue	—			—			(7.7		)	—			(7.7		)
Purchased power	—			—			2.2			—			2.2
Total	$	0.1		$	—		$	(5.5	)	$	—		$	(5.4	)

This report includes the filing of AES Ohio. AES Ohio is a public utility incorporated in 1911 under the laws of Ohio. AES Ohio is an indirect majority-owned subsidiary of DPL. Throughout this report, the terms “we,” “us,” “our” and “ours” are used to refer to AES Ohio, unless the context indicates otherwise.

~~DPL~~The ~~has~~condensed ~~elected~~financial ~~not~~statements toincluded ~~offset~~in ~~derivative~~PART ~~assets~~I, ~~and~~ITEM ~~liabilities~~1. ~~and~~– ~~not~~Financial toStatements ~~offset~~of ~~net~~this ~~derivative~~Form ~~positions~~10-Q ~~against~~and the ~~right~~discussions tocontained ~~reclaim~~herein ~~cash~~should ~~collateral~~be ~~pledged~~read ~~(an~~in ~~asset)~~conjunction orwith ~~the~~our ~~obligation~~Form ~~to return cash collateral received (a liability) under derivative agreements~~10-K.

~~The~~FORWARD–LOOKING following tables summarize the derivative positions presented in the balance sheet where a right of offset exists under these arrangements and related cash collateral received or pledged. The following table presents the fair value and balance sheet classification of DPL’s derivative instruments at June 30, 2016:STATEMENTS

Fair Values of Derivative Instruments
at June 30, 2016
				Gross Amounts Not Offset in the Condensed Consolidated Balance Sheets
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Consolidated Balance Sheets		Financial Instruments with Same Counterparty in Offsetting Position			Cash Collateral			Net Balance Fair Value
Assets
Short-term derivative positions (presented in Other prepayments and current assets)
Forward power contracts	Designated	$	13.9	$	(11.3	)	$	—		$	2.6
Forward power contracts	Not designated	13.8		(12.1		)	—			1.7
Natural gas futures	Not designated	0.3		—			—			0.3
FTRs	Not designated	0.1		—			—			0.1
Long-term derivative positions (presented in Other deferred assets)
Forward power contracts	Designated	9.1		(4.8		)	—			4.3
Forward power contracts	Not designated	2.5		(1.4		)	—			1.1
Total assets		$	39.7	$	(29.6	)	$	—		$	10.1
Liabilities
Short-term derivative positions (presented in Other current liabilities)
Forward power contracts	Designated	$	19.4	$	(11.3	)	$	(8.0	)	$	0.1
Forward power contracts	Not designated	19.5		(12.1		)	(3.1		)	4.3
Long-term derivative positions (presented in Other deferred credits)
Forward power contracts	Designated	4.9		(4.8		)	—			0.1
Forward power contracts	Not designated	1.4		(1.4		)	—			—
Total liabilities		$	45.2	$	(29.6	)	$	(11.1	)	$	4.5

The following discussion may contain forward-looking statements regarding us, our business, prospects and our results of operations that are subject to certain risks and uncertainties posed by many factors and events that could cause our actual business, prospects and results of operations to differ materially from those that may be anticipated by such forward-looking statements. These statements include, but are not limited to, statements regarding management’s intents, beliefs, and current expectations and typically contain, but are not limited to, the terms “anticipate,” “potential,” “expect,” “forecast,” “target,” “will,” “would,” “intend,” “believe,” “project,” “estimate,” “plan,” and similar words. Forward-looking statements are not intended to be a guarantee of future results, but instead constitute current expectations based on reasonable assumptions. Factors that could cause or contribute to such differences include, but are not limited to, those described in PART II, ITEM 1A of this quarterly report and ITEM 1A. Risk Factors and Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations of our Form 10-K and subsequent filings with the SEC.

Readers are cautioned not to place undue reliance on these forward-looking statements which speak only as of the date of this report. We undertake no obligation to revise any forward-looking statements in order to reflect events or circumstances that may subsequently arise. If we do update one or more forward-looking statements, no inference should be made that we will make additional updates with respect to those or other forward-looking statements. Readers are urged to carefully review and consider the various disclosures made by us in this report and in our other reports filed with the SEC that advise of the risks and factors that may affect our business.

OVERVIEW OF OUR BUSINESS

AES Ohio is a regulated electric utility operating in the state of Ohio. Substantially all of our business consists of the transmission, distribution and sale of electric energy conducted. AES Ohio operates as a single segment. For more information regarding our business, see Item 1. Business of our Form 10-K.

~~Table~~EXECUTIVE ~~of Contents~~SUMMARY

~~The~~Compared ~~following~~with ~~table~~the ~~presents~~same period in the ~~fair~~prior ~~value~~year, ~~and~~AES ~~balance~~Ohio's ~~sheet~~results ~~classification~~for the three months ended June 30, 2025, reflect a decrease in income before income tax of ~~DPL’s~~$9.4 ~~derivative~~million, ~~instruments~~or at49.7%, ~~December~~as well as a decrease in net income of $9.6 million, or 63.6%, and, for the six months ended June 3130, ~~2015~~2025, reflect a decrease in income before income tax of $8.7 million, or 28.4%, as well as a decrease in net income of $8.3 million, or 33.9%, primarily due to factors including, but not limited to:

Fair Values of Derivative Instruments
				Three months ended					Six months ended
at December 31, 2015
				June 30,					June 30,
						Gross Amounts Not Offset in the Condensed ConsolidatedBalance Sheets
$ in millions				2025 vs. 2024					2025 vs. 2024
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Consolidated Balance Sheets				Financial Instruments with Same Counterparty in Offsetting Position			Cash Collateral			Net Balance Fair Value
Decrease due to higher depreciation and amortization driven by assets placed in service				$	(8.3)				$	(15.0)
Assets
Decrease from higher taxes other than income taxes due to higher assessed values driven by AES Ohio's capital expenditure program, net of regulatory deferrals				(0.8)					(7.8)
Short-term derivative positions (presented in Other prepayments and current assets)
Decrease due to higher interest expense primarily from increased borrowings				(2.0)					(5.5)
Forward power contracts	Designated	$	16.2			$	(7.1	)	$	—		$	9.1
Decrease due to lower AFUDC equity				(2.1)					(3.9)
Forward power contracts	Not designated	7.3				(5.5		)	—			1.8
Decrease due to a reserve recorded for the LGR regulatory asset as the rider will end upon the effective date of Sub. HB 15				(3.2)					(3.2)
FTRs	Not designated	0.2				(0.2		)	—			—
Increase due to higher transmission revenue driven by an increase in transmission investments				5.0					14.8
Long-term derivative positions (presented in Other deferred assets)
Increase due to higher DIR revenues				5.0					9.7
Forward power contracts	Designated	3.0				(2.4		)	—			0.6
Increase (decrease) in retail margin due to higher (lower) volumes driven by weather and higher (lower) retail demand				(4.0)					2.4
Forward power contracts	Not designated	4.0				(2.7		)	—			1.3
Other				1.0					(0.2)
Total assets		$	30.7			$	(17.9	)	$	—		$	12.8
Net change in income before income tax				(9.4)					(8.7)
Liabilities
Net change in income tax expense				(0.2)					0.4
Short-term derivative positions (presented in Other current liabilities)
Net change in net income				$	(9.6)				$	(8.3)
Forward power contracts	Designated	$	7.1			$	(7.1	)	$	—		$	—
Forward power contracts	Not designated	14.5				(5.5		)	(8.0		)	1.0
FTRs	Not designated	0.5				(0.2		)	—			0.3
Long-term derivative positions (presented in Other deferred credits)
Forward power contracts	Designated	2.7				(2.4		)	—			0.3
Forward power contracts	Not designated	2.7				(2.7		)	—			—
Total liabilities		$	27.5			$	(17.9	)	$	(8.0	)	$	1.6

Credit risk-related contingent features

Certain of our OTC commodity derivative contracts are under master netting agreements that contain provisions that require us to post collateral if our credit ratings drop below certain thresholds. We have crossed that threshold with one counterparty to the derivative instruments and they could request that we post collateral of $0.9 million at this time.

The aggregate fair value of DPL’s commodity derivative instruments that were in a MTM loss position at June 30, 2016 was $45.2 million. $11.1 million of collateral was posted directly with third parties and in a broker margin account which offsets our loss positions on the forward contracts. This liability position is further offset by the asset position of counterparties with master netting agreements of $29.6 million. Since our debt is below investment grade, we could have to post collateral for the remaining $4.5 million.

~~Table~~RESULTS ofOF ~~Contents~~OPERATIONS

Note 5 – Debt


	Three months ended								Six months ended
	June 30,								June 30,
$ in millions	2025		2024		$ change		% change		2025		2024		$ change		% change
REVENUE:
Retail	$	177.7	$	166.9	$	10.8	6.5	%	$	379.2	$	355.9	$	23.3	6.5	%
Wholesale	5.3		2.8		2.5		89.3	%	14.5		7.8		6.7		85.9	%
RTO ancillary	39.2		34.2		5.0		14.6	%	76.8		62.0		14.8		23.9	%
Capacity revenue	0.8		0.3		0.5		166.7	%	1.1		0.4		0.7		175.0	%
Miscellaneous revenue	4.6		2.7		1.9		70.4	%	8.1		5.1		3.0		58.8	%
Total revenue	227.6		206.9		20.7		10.0	%	479.7		431.2		48.5		11.2	%

OPERATING COSTS AND EXPENSES:
Purchased power:
Purchased power	52.6		48.9		3.7		7.6	%	115.9		119.2		(3.3)		(2.8)	%
RTO charges	29.9		20.3		9.6		47.3	%	61.4		39.5		21.9		55.4	%


Net purchased power	82.5		69.2		13.3		19.2	%	177.3		158.7		18.6		11.7	%
Operation and maintenance	64.8		60.8		4.0		6.6	%	128.7		121.5		7.2		5.9	%
Depreciation and amortization	29.0		20.7		8.3		40.1	%	57.8		42.8		15.0		35.0	%
Taxes other than income taxes	27.7		26.9		0.8		3.0	%	63.9		56.1		7.8		13.9	%



Other, net	—		—		—		—	%	—		1.1		(1.1)		(100.0)	%
Total operating costs and expenses	204.0		177.6		26.4		14.9	%	427.7		380.2		47.5		12.5	%

Operating income	23.6		29.3		(5.7)		(19.5)	%	52.0		51.0		1.0		2.0	%

OTHER INCOME / (EXPENSE), NET:
Interest expense, net	(13.7)		(11.7)		(2.0)		17.1	%	(28.4)		(22.9)		(5.5)		24.0	%

Other income / (expense), net	(0.4)		1.3		(1.7)		(130.8)	%	(1.7)		2.5		(4.2)		(168.0)	%
Total other expense, net	(14.1)		(10.4)		(3.7)		35.6	%	(30.1)		(20.4)		(9.7)		47.5	%

INCOME BEFORE INCOME TAX (a)	9.5		18.9		(9.4)		(49.7)	%	21.9		30.6		(8.7)		(28.4)	%

Income tax expense	4.0		3.8		0.2		5.3	%	5.7		6.1		(0.4)		(6.6)	%

NET INCOME (a)	$	5.5	$	15.1	$	(9.6)	(63.6)	%	$	16.2	$	24.5	$	(8.3)	(33.9)	%

	Interest		June 30,			December 31,
$ in millions	Rate	Maturity	2016			2015
First mortgage bonds	1.875%	2016	$	445.0		$	445.0
Pollution control series	4.8%	2036	100.0			100.0
Pollution control series - rates from 1.29% - 1.31% and 1.13% - 1.17% (a)		2020	200.0			200.0
U.S. Government note	4.2%	2061	18.0			18.1
Unamortized deferred financing costs			(3.4		)	(5.0		)
Unamortized debt discount and premiums, net			(3.5		)	(3.6		)
Total long-term debt at subsidiary			756.1			754.5
Bank term loan - rates from 2.67% - 2.71% and 2.44% - 2.67% (a)		2020	125.0			125.0
Senior unsecured bonds	6.5%	2016	57.0			130.0
Senior unsecured bonds	6.75%	2019	200.0			200.0
Senior unsecured bonds	7.25%	2021	780.0			780.0
Note to DPL Capital Trust II (b)	8.125%	2031	15.6			15.6
Unamortized deferred financing costs			(9.8		)	(11.1		)
Unamortized debt discounts and premiums, net			(0.6		)	(0.7		)
Total long-term debt			1,923.3			1,993.3
Less: current portion			(514.0		)	(572.8		)
Total long-term debt			$	1,409.3		$	1,420.5

(a) For purposes of discussing operating results, we present and discuss INCOME BEFORE INCOME TAX and NET INCOME. This format is useful to investors because it allows analysis and comparability of operating trends and includes the same information that is used by management to make decisions regarding our financial performance.

(a) Range of interest rates for the six months ended June 30, 2016 and the twelve months ended December 31, 2015, respectively.

(b) Note payable to related party. See Note 9 – Related Party Transactions for additional information.

Premiums or discounts recognized at the date of the Merger are amortized over the remaining life of the debt using the effective interest method.

Significant transactions

On February 5, 2016, $73.0 million of DPL's $130.0 million 6.5% Senior Unsecured Notes Due 2016 were redeemed under the indenture's make-whole call provision, which allows for the bonds to be called prior to maturity with a make-whole payment as determined by discounting the bond's future cash flow by a similarly maturing U.S. Treasury bond's yield plus 50 basis points. On the call date, principal plus the make-whole payment due totaled $75.4 million, which was paid with cash on hand.

Debt covenants and restrictions

DP&L’s unsecured revolving credit agreement and Bond Purchase and Covenants Agreement have two financial covenants. The first financial covenant measures Total Debt to Total Capitalization. The Total Debt to Total Capitalization ratio is calculated, at the end of each fiscal quarter, by dividing total debt at the end of the quarter by total capitalization at the end of the quarter. The second financial covenant ratio compares EBITDA to Interest Expense. The EBITDA to Interest Expense ratio is calculated, at the end of each fiscal quarter, by dividing EBITDA for the four prior fiscal quarters by the consolidated interest charges for the same period.

The cost of borrowing under DP&L's unsecured revolving credit agreement and Bond Purchase and Covenants Agreement adjust under certain credit rating scenarios.

DPL’s revolving credit agreement and term loan have two financial covenants. The first financial covenant, a Total Debt to EBITDA ratio, is calculated at the end of each fiscal quarter by dividing total debt at the end of the current quarter by consolidated EBITDA for the four prior fiscal quarters. The second financial covenant, an EBITDA to Interest Expense ratio, is calculated, at the end of each fiscal quarter, by dividing EBITDA for the four prior fiscal quarters by the consolidated interest charges for the same period.

~~Table of Contents~~Revenue

~~The~~Retail ~~cost~~customers, ofespecially ~~borrowing~~residential ~~under~~and ~~DPL's~~commercial ~~revolving~~customers, ~~credit~~consume ~~agreement~~more electricity on warmer and ~~term~~colder ~~loan~~days. ~~adjust~~Therefore, ~~under~~our ~~certain~~retail ~~credit~~sales ~~rating~~demand ~~scenarios~~is affected by the number of heating and cooling degree-days occurring during a year. ~~DPL’s~~ ~~revolving~~Cooling ~~credit~~degree-days ~~agreement,~~typically ~~term~~have ~~loan~~a more significant effect than heating degree-days since some residential customers do not use electricity to heat their homes. Additionally, ~~and~~our ~~senior~~retail ~~unsecured~~revenue ~~notes~~is ~~due~~affected ~~2019~~by ~~restrict~~regulated ~~dividend~~rates ~~payments~~and ~~from~~riders ~~DPL~~including the changes to our ESP described in Note 2. Regulatory Matters of our Form 10-K and Note 2 – Regulatory Matters of AES Ohio's Condensed Financial Statements.

Substantially all property, plant & equipment of DP&L is subject to the lien of the mortgage securing DP&L’s First and Refunding Mortgage.


HEATING AND COOLING DEGREE-DAYS (a)
	Three months ended					Six months ended
	June 30,					June 30,
	2025	2024	change	% change		2025	2024	change	% change
Actual
Heating degree-days	484	311	173	55.6	%	3,223	2,609	614	23.5	%
Cooling degree-days	374	443	(69)	(15.6)	%	380	443	(63)	(14.2)	%

30-year average (b)
Heating degree-days	535	539				3,314	3,321
Cooling degree-days	313	310				316	312

~~Note~~(a)Heating 6and –cooling ~~Income~~degree-days ~~Taxes~~are a measure of the relative heating or cooling required for a home or business. The heating degrees in a day are calculated as the degrees that the average actual daily temperature is below 65 degrees Fahrenheit. For example, if the average temperature on March 20th was 40 degrees Fahrenheit, the heating degrees for that day would be the 25-degree difference between 65 degrees and 40 degrees. Similarly, cooling degrees in a day are calculated as the degrees that the average actual daily temperature is above 65 degrees Fahrenheit.

~~The~~(b)30-year ~~following~~average ~~table~~is ~~details~~computed ~~the~~from ~~effective~~observed ~~tax~~degree-days ~~rates~~in ~~for~~ the ~~three~~Dayton ~~and~~area ~~six~~on ~~months~~a ~~ended~~trailing ~~June~~ 30,-year ~~2016 and 2015~~basis.

	Three months ended		Six months ended
	June 30,		June 30,
	2016	2015	2016	2015
DPL	39.2%	28.2%	39.5%	28.8%

AES Ohio's electric sales and billed customers were as follows:

Income tax expense for the six months ended June 30, 2016 and 2015 was calculated using the estimated annual effective income tax rates for 2016 and 2015 of 38.8% and 31.2%, respectively. For the three and six months ended June 30, 2016 and 2015, management estimated the annual effective tax rate based on its forecast of annual pre-tax income. To the extent that actual pre-tax results for the year differ from the forecasts applied to the most recent interim period, the rates estimated could be materially different from the actual effective tax rates.


ELECTRIC SALES AND CUSTOMERS
	Three months ended					Six months ended
	June 30,					June 30,
	2025	2024	change	% change		2025	2024	change	% change
Retail electric sales (a)
Residential	1,123	1,196	(73)	(6.1)	%	2,711	2,620	91	3.5	%
Commercial	868	912	(44)	(4.8)	%	1,791	1,779	12	0.7	%
Industrial	941	920	21	2.3	%	1,767	1,791	(24)	(1.3)	%
Governmental	288	302	(14)	(4.6)	%	572	586	(14)	(2.4)	%
Other	9	10	(1)	(10.0)	%	18	20	(2)	(10.0)	%
Total retail electric sales	3,229	3,340	(111)	(3.3)	%	6,859	6,796	63	0.9	%
Wholesale electric sales (b)	114	83	31	37.3	%	280	225	55	24.4	%
Total electric sales	3,343	3,423	(80)	(2.3)	%	7,139	7,021	118	1.7	%

~~For~~(a)DPL ~~the three~~ and ~~six~~AES ~~months~~Ohio ~~ended~~retail ~~June 30,~~electric ~~2016,~~sales ~~DPL’s~~represent ~~current~~the ~~period~~total ~~effective~~transmission ~~tax~~and ~~rate~~distribution ~~was~~retail ~~greater~~sales ~~than~~for the ~~estimated~~periods ~~annual~~presented. ~~effective~~SSO ~~rate~~sales ~~primarily~~were ~~due~~452 tokWh aand ~~change~~423 inkWh ~~its~~for ~~uncertain~~the ~~tax~~three ~~positions. The~~months ~~increase~~ended inand ~~the~~1,037 ~~annual~~kWh ~~effective~~and ~~rate~~994 ~~compared~~kWh tofor the ~~same~~six ~~period~~months inended ~~2015~~June 30, is2025 ~~primarily~~and ~~due~~2024, ~~to a forecasted pre-tax loss in the 2016 tax year~~respectively.

~~Note~~(b)Wholesale 7electric –sales ~~Benefit~~are ~~Plans~~AES Ohio's 4.9% share of the generation output of OVEC.

~~DP&L~~The ~~sponsors~~following acharts ~~defined~~show ~~benefit~~the ~~pension~~percentage ~~plan~~changes in weather-normalized and actual retail electric kWh sales volumes by customer class for the ~~vast~~three ~~majority~~and ofsix ~~its~~months ~~employees.~~ended June 30, 2025 compared to the same periods in the prior year:

We generally fund pension plan benefits as accrued in accordance with the minimum funding requirements of ERISA and, in addition, make voluntary contributions from time to time. There were $5.0 million in employer contributions made during the six months ended June 30, 2016 and no contributions during the six months ended June 30, 2015.

The amounts presented in the following tables for pension include the collective bargaining plan formula, the traditional management plan formula, the cash balance plan formula and the SERP, in the aggregate. The amounts presented for postretirement include both health and life insurance. The pension and postretirement costs below have not been adjusted for amounts billed to the Service Company for former DP&L employees who are now employed by the Service Company but are still participants in the DP&L plan. See Note 9 – Related Party Transactions.

The net periodic benefit cost of the pension and postretirement benefit plans for the three and six months ended June 30, 2016 and 2015 was:

Net Periodic Benefit Cost	Pension
	Three months ended						Six months ended
	June 30,						June 30,
$ in millions	2016			2015			2016			2015
Service cost	$	1.4		$	1.8		$	2.8		$	3.6
Interest cost	3.7			4.3			7.4			8.6
Expected return on plan assets	(5.7		)	(5.6		)	(11.4		)	(11.3		)
Amortization of unrecognized:
Prior service cost	0.5			0.5			1.0			1.0
Actuarial loss	1.1			1.4			2.1			2.9
Net periodic benefit cost	$	1.0		$	2.4		$	1.9		$	4.8

Table of Contents

Net Periodic Benefit Cost	Postretirement
	Three months ended						Six months ended
	June 30,						June 30,
$ in millions	2016			2015			2016			2015
Service cost	$	0.1		$	—		$	0.1		$	—
Interest cost	0.1			0.1			0.2			0.3
Expected return on plan assets	—			—			—			—
Amortization of unrecognized:
Prior service cost	—			—			—			—
Actuarial gain	(0.2		)	(0.1		)	(0.3		)	(0.2		)
Net periodic benefit cost	$	—		$	—		$	—		$	0.1

Benefit payments and Medicare Part D reimbursements, which reflect future service, are estimated to be paid as follows:

$ in millions	Pension		Postretirement
2016	$	12.3	$	0.8
2017	25.2		1.6
2018	25.8		1.5
2019	26.3		1.4
2020	26.7		1.4
2021 - 2025	134.8		5.7

Note 8 – Contractual Obligations, Commercial Commitments and Contingencies

Guarantees

In the normal course of business, DPL enters into various agreements with its wholly-owned subsidiary, AES Ohio Generation, providing financial or performance assurance to third parties. These agreements are entered into primarily to support or enhance the creditworthiness otherwise attributed to these subsidiaries on a stand-alone basis, thereby facilitating the extension of sufficient credit to accomplish these subsidiaries’ intended commercial purposes.

At June 30, 2016, DPL had $14.6 million of guarantees on behalf of AES Ohio Generation to third parties for future financial or performance assurance under such agreements. The guarantee arrangements entered into by DPL with these third parties cover select present and future obligations of AES Ohio Generation to such beneficiaries and are terminable by DPL upon written notice to the beneficiaries within a certain time. The carrying amount of obligations for commercial transactions covered by these guarantees recorded in our Condensed Consolidated Balance Sheets was $2.1 million and $0.5 million at June 30, 2016 and December 31, 2015, respectively.

To date, DPL has not incurred any losses related to the guarantees of AES Ohio Generation’s obligations and we believe it is remote that DPL would be required to perform or incur any losses in the future associated with any of the above guarantees.

Equity Ownership Interest

DP&L owns a 4.9% equity ownership interest in OVEC, which is recorded using the cost method of accounting under GAAP. As of June 30, 2016, DP&L could be responsible for the repayment of 4.9%, or $75.3 million, of a $1,537.4 million debt obligation that has maturities from 2018 to 2040. This would only happen if OVEC defaulted on its debt payments. As of June 30, 2016, we have no knowledge of such a default.

Commercial Commitments and Contractual Obligations

There have been no material changes, outside the ordinary course of business, to our commercial commitments and to the information disclosed in the contractual obligations table in our Form 10-K for the fiscal year ended December 31, 2015.

Contingencies

~~Table~~During the three months ended June 30, 2025, revenue increased $20.7 million to $227.6 million compared to $206.9 million in the same period of ~~Contents~~the prior year, and, during the six months ended June 30, 2025, revenue increased $48.5 million to $479.7 million compared to $431.2 million in the same period of the prior year. These changes were primarily the result of changes in the components of revenue shown below:

Financial Statements, as prescribed by GAAP, are adequate in light of the probable and estimable contingencies. However, there can be no assurances that the actual amounts required to satisfy alleged liabilities from various legal proceedings, claims, tax examinations and other matters discussed below, and to comply with applicable laws and regulations, will not exceed the amounts reflected in our Condensed Consolidated Financial Statements. As such, costs, if any, that may be incurred in excess of those amounts provided as of June 30, 2016, cannot be reasonably determined.


	Three months ended		Six months ended
	June 30,		June 30,
$ in millions	2025 vs. 2024		2025 vs. 2024
Retail
Rate
Increase in the TCRR	$	9.7	$	21.8
Increase in the DIR	5.0		9.7
Increase in the Infrastructure Investment Rider	0.5		4.9
Increase in the Proactive Reliability Optimization	3.9		3.8
Decrease in the Competitive Bid Revenue Rider Rate	(7.3)		(20.6)
Decrease in the Storm rider	(1.8)		(5.2)




Other	2.5		3.5
Net change in retail rate	12.5		17.9

Volume
Increase / (Decrease) in demand primarily due to weather versus the comparable period	(1.2)		6.7

Net change in retail volume	(1.2)		6.7

Other miscellaneous	(0.5)		(1.3)
Net retail change	10.8		23.3

Wholesale
Increase primarily due to higher rates and volumes on power sales at OVEC	2.5		6.7

RTO ancillary and capacity revenue
Increase due to higher transmission revenue driven by an increase in transmission investments	5.5		15.5

Other
Miscellaneous revenue	1.9		3.0
Net change in revenue	$	20.7	$	48.5

~~Environmental~~Net ~~Matters~~Purchased Power

~~DPL’s~~During ~~and~~the ~~DP&L’s~~three ~~facilities~~months ~~and~~ended ~~operations~~June ~~are~~30, ~~subject~~2025, net purchased power increased $13.3 million to a$82.5 ~~wide~~million ~~range~~compared to $69.2 million in the same period of ~~federal,~~the ~~state~~prior year, and, ~~local~~during ~~environmental~~the ~~regulations~~six ~~and~~months ~~laws~~ended June 30, 2025, net purchased power increased $18. ~~The~~6 ~~environmental~~million ~~issues~~to ~~that~~$177.3 ~~may~~million ~~affect~~compared usto ~~include:~~$158.7 million in the same period of the prior year. These changes were primarily the result of changes in the cost of purchased power shown below.

• The federal CAA and state laws and regulations (including State Implementation Plans) which require compliance, obtaining permits and reporting as to air emissions;


	Three months ended		Six months ended
	June 30,		June 30,
$ in millions	2025 vs. 2024		2025 vs. 2024
Net purchased power
Purchased power
Rate
Decrease primarily due to lower prices in the competitive bid process	$	(9.4)	$	(20.9)

Volume
Increase in volume of purchased power primarily due to higher retail SSO demand versus the comparable period	13.1		17.6
Total purchased power change	3.7		(3.3)

RTO charges
Increase primarily due to increase in TCRR rates	9.6		21.9

Net change in purchased power	$	13.3	$	18.6

• Litigation with federal and certain state governments and certain special interest groups regarding whether modifications to or maintenance of certain coal-fired generating stations require additional permitting or pollution control technology, or whether emissions from coal-fired generating stations cause or contribute to climate change;

• Rules and future rules issued by the USEPA and the Ohio EPA that require substantial reductions in SO2, particulates, mercury, acid gases, NOx, and other air emissions. DP&L has installed emission control technology and is taking other measures to comply with required and anticipated reductions;

• Rules and future rules issued by the USEPA, the Ohio EPA or other authorities that require reporting and reductions of GHGs;

• Rules and future rules issued by the USEPA associated with the federal Clean Water Act, which prohibits the discharge of pollutants into waters of the United States except pursuant to appropriate permits; and

• Solid and hazardous waste laws and regulations, which govern the management and disposal of certain waste. The majority of solid waste created from the combustion of coal and fossil fuels consists of fly ash and other coal combustion by-products.

Note 9 – Related Party Transactions

Service Company

Effective January 1, 2014, the Service Company began providing services including operations, accounting, legal, human resources, information technology and other corporate services on behalf of companies that are part of the U.S. SBU, including, among other companies, DPL and DP&L. The Service Company allocates the costs for these services based on cost drivers designed to result in fair and equitable allocations. This includes ensuring that the regulated utilities served, including DP&L, are not subsidizing costs incurred for the benefit of other businesses.

Benefit plans

DPL has an agreement with AES or one of its affiliates to participate in a group benefits program, including but not limited to, health, dental, vision and life benefits. AES or its affiliate administers the financial aspects of the group insurance program, receives all premium payments from the participating affiliates, and makes all vendor payments.

~~Table~~Operation ofand ~~Contents~~Maintenance

~~The~~During ~~following~~the ~~table~~three ~~provides~~and asix ~~summary~~months ended June 30, 2025, Operation and Maintenance expense increased $4.0 million and $7.2 million, respectively, compared to the same periods in the prior year. The main drivers of these ~~transactions~~changes are as follows:

	~~Three months ended~~			Three months ended		~~Six months ended~~		Six months ended
	~~June 30,~~			June 30,		~~June 30,~~		June 30,
$ in millions	~~2016~~			~~2015~~2025 vs. 2024		~~2016~~		2025 vs. 2024		~~2015~~
Transactions with the Service Company
Increase in IT costs, primarily associated with customer billing system upgrade				$	2.4			$	6.3
Charges for services provided	$	11.5		$	9.8	$	23.1			$	19.6
Other				1.6				0.9
Charges to the Service Company	$	1.1		$	2.8	$	2.3			$	3.9
Net change in operation and maintenance expense				$	4.0			$	7.2
Transactions with other AES affiliates:
Charges / (credits) for health, welfare and benefit plans	$	(2.4	)	$	4.2	$	1.7			$	8.2
Transactions with the Service Company:						At June 30, 2016				At December 31, 2015
Net payable to the Service Company						$	(1.1	)		$	(0.5	)

~~DPL~~(a) There ~~Capital~~is ~~Trust~~a IIcorresponding offset in Revenue associated with these costs and minimal operating margin impact.

~~DPL~~Depreciation has a wholly-owned business trust, DPL Capital Trust II (the "Trust"), formed for the purpose of issuing trust capital securities to third-party investors. Effective in 2003, DPL deconsolidated the Trust upon adoption of the accounting standards related to variable interest entities and currently treats the Trust as a nonconsolidated subsidiary. The Trust holds mandatorily redeemable trust capital securities. The investment in the Trust, which amounts to $0.3 million and $0.3 million at June 30, 2016 and December 31, 2015, respectively, is included in Other deferred assets within Other non-current assets. DPL also has a note payable to the Trust amounting to $15.6 million and $15.6 million at June 30, 2016 and December 31, 2015, respectively, that was established upon the Trust’s deconsolidation in 2003. See Note 5 – Debt for additional information.Amortization

InDuring ~~addition to~~ the ~~obligations~~three ~~under~~and ~~the~~six ~~note~~months ~~payable~~ended ~~mentioned~~June ~~above~~30, ~~DPL~~2025, ~~also~~Depreciation ~~agreed~~and toamortization aincreased ~~security~~$8.3 ~~obligation~~million ~~which~~and ~~represents~~$15.0 amillion, ~~full~~respectively, ~~and~~compared ~~unconditional~~to ~~guarantee~~the ofsame ~~payments~~periods toin the ~~capital~~prior ~~security~~year, ~~holders~~primarily ofdue ~~the~~to ~~Trust~~additional assets placed in service.

Taxes Other Than Income ~~taxes~~Taxes

~~AES~~During ~~files~~the ~~federal~~three and ~~state~~six ~~income~~months ~~tax~~ended ~~returns~~June ~~which~~30, ~~consolidate DPL and its subsidiaries. Under a tax sharing agreement with AES~~2025, ~~DPL~~Taxes isother ~~responsible~~than ~~for the~~ income taxes ~~associated~~increased ~~with~~$0.8 ~~its~~million ~~own taxable income~~ and ~~records~~$7.8 ~~the~~million, ~~provision~~respectively, ~~for~~compared ~~income~~to ~~taxes~~the ~~using~~same aperiods ~~separate~~in ~~return~~the ~~method~~prior year. ~~DPL~~ ~~had~~The aincrease ~~net~~was ~~payable~~primarily ~~balance~~the ~~under~~result ~~this agreement~~ of ~~$78.9~~higher ~~million~~property ~~and~~taxes ~~$50.5~~due ~~million~~to ashigher ofassessed ~~June 30,~~values ~~2016~~driven ~~and~~by ~~December 31,~~AES ~~2015,~~Ohio's ~~respectively,~~capital ~~which~~expenditure ~~is recorded in the Accrued taxes and Accounts receivable~~plan, net ~~lines~~of onregulatory ~~the accompanying Condensed Consolidated Balance Sheets a gross basis~~deferrals.

~~Note~~Interest 10Expense, ~~– Business Segments~~Net

AtDuring ~~December~~the ~~31,~~three ~~2015,~~and ~~DPL~~six ~~had~~months ~~two~~ended ~~segments~~June ~~consisting~~30, of2025, ~~the~~Interest ~~operations of two of its wholly-owned subsidiaries~~expense, ~~DP&L~~net ~~(Utility~~increased ~~segment)~~$2.0 million and ~~DPLER~~$5.5 ~~(Competitive~~million, ~~Retail~~respectively, ~~segment~~compared ~~which~~to ~~included~~the ~~DPLER's~~same ~~wholly-owned~~periods ~~subsidiary,~~in MCthe ~~Squared)~~prior year. ~~This~~ isThe ~~how~~increases wewere ~~viewed~~primarily ~~our~~due ~~business~~to ~~and~~higher ~~made~~outstanding ~~decisions~~debt onbalances ~~how~~versus tothe ~~allocate~~comparable ~~resources~~periods ~~and~~in ~~evaluate~~the ~~performance~~prior year.

~~The~~Other ~~Competitive~~Income ~~Retail~~/ ~~segment, DPLER’s competitive retail electric service business, was sold on January 1, 2016~~ (~~see Note 11 – Discontinued Operations~~Expense)~~. DPL now operates through one segment~~, the Utility segment. Segment disclosures for 2015 have not been restated to show the competitive retail segment as a discontinued operation and therefore do not tie to the Condensed Consolidated Statement of Operations.Net

~~The~~During ~~Utility~~the ~~segment~~three isand ~~comprised~~six ofmonths ~~DP&L’s~~ended ~~electric~~June ~~generation~~30, ~~transmission~~2025, ~~and~~Other ~~distribution~~income ~~businesses~~/ ~~which generate and deliver electricity to residential~~(expense), ~~commercial,~~net ~~industrial~~decreased ~~and governmental customers~~$1. ~~DP&L~~7 ~~generates~~million ~~electricity at five coal-fired power plants~~ and ~~DP&L~~$4.2 ~~distributes~~million, ~~power to approximately 517~~respectively,~~000~~ ~~retail~~compared ~~customers~~to ~~who~~the ~~are~~same ~~located~~periods in ~~a 6,000 square mile area of West Central Ohio. Prior to~~ the ~~sale~~prior ~~of DPLER~~year, ~~DP&L~~primarily ~~also~~due ~~sold electricity~~ to ~~DPLER~~lower ~~and~~AFUDC ~~to other Ohio utilities~~equity. ~~Any excess energy and capacity is sold into the PJM wholesale~~

Income Tax Expense


	Three months ended					Six months ended
	June 30,					June 30,
$ in millions	2025	2024	change	% change		2025	2024	change	% change
Income tax expense	4.0	3.8	0.2	5	%	5.7	6.1	(0.4)	(7)	%

The increases / (decreases) in income tax expense of $0.2 million and $(0.4) million during the three and six months ended June 30, 2025, respectively, compared to the same periods of the prior year were primarily driven by higher pre-tax income in the prior year, offset by a decrease in the net tax benefit related to the reversal of excess deferred taxes and AFUDC equity.

See Note 5. Income Taxes of AES Ohio's Condensed Financial Statements for further discussion.

KEY TRENDS AND UNCERTAINTIES

During 2025 and beyond, we expect our financial results will be primarily impacted by retail demand and weather. In addition, AES Ohio's financial results are likely to be driven by other factors including, but not limited to:

•regulatory outcomes;

•the passage of new legislation, implementation of regulations or other changes in regulation; and

•the timely recovery of transmission and distribution expenditures.

If favorable outcomes related to these factors do not occur, or if the challenges described below and elsewhere in this Quarterly Report impact us more significantly than we currently anticipate, then these factors, or other factors

~~Table~~unknown to us, may impact our operating income, net income and cash flows. We continue to monitor our operations and address challenges as they arise. For a discussion of ~~Contents~~the risks related to our business, see Item 1. Business and Item 1A. Risk Factors in our Form 10-K.

~~market. DP&L’s transmission and distribution businesses are subject to rate regulation by federal and state regulators while rates for its generation business are deemed competitive under Ohio law.~~Operational

~~The~~Customer ~~Competitive~~Information ~~Retail~~and ~~segment’s~~Billing ~~electric~~System ~~energy~~Implementation used to meet its sales obligations was purchased from DP&L. Intercompany sales from DP&L to DPLER were based on fixed-price contracts for each customer; the price approximated market prices for wholesale power at the inception of each customer’s contract. These agreements were terminated in connection with the sale of DPLER on January 1, 2016.

~~Included~~During in the ~~“Other”~~third ~~column~~quarter inof ~~the~~2024, ~~following~~we ~~tables~~implemented ~~are~~our ~~other~~new ~~businesses~~customer ~~that~~information doand ~~not~~billing ~~meet~~system, ~~the~~SAP ~~GAAP~~IS-U, ~~requirements~~a ~~for~~software ~~disclosure~~solution asthat ~~reportable~~SAP ~~segments,~~developed ~~certain~~for ~~corporate~~businesses ~~costs~~operating ~~including~~in ~~interest~~the ~~expense~~utility onindustries. ~~DPL’s~~In ~~debt~~connection with this implementation, ~~and~~a ~~adjustments~~temporary ~~related~~pause toof ~~purchase~~customer ~~accounting~~disconnections ~~from~~and ~~the~~certain ~~Merger. Management~~collection ~~evaluates~~efforts ~~segment~~and ~~performance~~write-off ~~based~~processes onwas ~~gross~~instituted, ~~margin. The~~which ~~accounting~~has ~~policies~~resulted ofin ~~the~~a ~~reportable~~higher ~~segments~~allowance ~~are~~for ~~the~~credit ~~same~~losses as ~~those~~of ~~described~~June in30, ~~Note~~2025. 1AES –Ohio ~~Overview~~reinstituted ~~and~~the ~~Summary~~customer ofdisconnections ~~Significant~~process ~~Accounting~~and ~~Policies. Intersegment~~collection ~~sales~~efforts and ~~profits~~write-off ~~are~~processes ~~eliminated~~ in ~~consolidation~~late June 2025.

~~The~~Capital ~~following tables present financial information for each of DPL’s reportable business segments:~~Projects

$ in millions	Utility Segment			Other			Adjustments and Eliminations			DPL Consolidated
For the three months ended June 30, 2016
Revenues from external customers	$	313.4		$	14.9		$	—		$	328.3
Intersegment revenues	0.3			0.9			(1.2		)	—
Total revenues	313.7			15.8			(1.2		)	328.3
Fuel	55.6			4.6			—			60.2
Purchased power	96.7			0.7			(0.5		)	96.9
Gross margin	$	161.4		$	10.5		$	(0.7	)	$	171.2
Depreciation and amortization	$	36.8		$	(0.8	)	$	—		$	36.0
Fixed-asset impairment	$	857.1		$	(621.6	)	$	—		$	235.5
Interest expense	$	5.4		$	20.3		$	0.3		$	26.0
Income tax expense / (benefit)	$	(303.7	)	$	215.4		$	—		$	(88.3	)
Net income / (loss)	$	(531.6	)	$	394.8		$	—		$	(136.8	)
Cash capital expenditures	$	36.0		$	5.4		$	—		$	41.4

Our construction projects have experienced some indications of delays and price increases due to supply chain disruptions; however, they are currently proceeding without material delays. For further discussion of our capital requirements, see PART I, ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations – Capital Resources and Liquidity of this Form 10-Q.

Macroeconomic and Political

U.S. Utilities Load Growth and Large Load Customers

The expansion of data center needs related to the growing use of generative artificial intelligence has the potential to be a significant accelerant to the load growth of the U.S. utilities market. AES Ohio is working with several companies to provide solutions for the electric service needs of data centers and we see these relationships growing as utilization of generative artificial intelligence drives the expansion of data center use within our service territory. As part of this process, AES Ohio is evaluating cost effective options to reliably serve these large data center customers.

Trump Administration Actions

On January 25, 2025, President Trump issued an Executive Order titled "Declaring a National Energy Emergency" directing agencies to, among other tasks, identify and exercise any lawful emergency authorities available to them to facilitate the identification, leasing, siting, production, transportation, refining, and generation of domestic energy resources.

Tax

The macroeconomic and political environments in the U.S. have changed in recent years. This could result in significant impacts to future tax law. In the U.S., the IRA included a 15% corporate alternative minimum tax (CAMT) based on adjusted financial statement income. In June 2025, the IRS released interim guidance for CAMT and announced its intention to revise regulations that were proposed in September 2024. The impact to the Company in 2025 is not expected to be material. We will continue to monitor the issuance of CAMT revised guidance.

On July 4, 2025, the United States enacted [H.R. 1] (the “2025 Act”). The legislation included amendments to, and extensions of, various U.S. corporate income tax provisions, which may impact our effective tax rate in future periods. However, the impact to the effective tax rate is not expected to be material. Our interpretation of the 2025 Act may change as the U.S. Treasury and the IRS issue additional guidance.

Inflation

In the markets in which we operate, there have been higher rates of inflation recently. If inflation increases in our market, it may increase our expenses that we may not be able to pass through to customers. AES Ohio may have the ability to recover operations and maintenance costs through the regulatory process; however, timing impacts on recovery may vary. In addition, the SSO auction process has reflected current macroeconomic conditions in terms of pricing.

~~Table~~Interest ofRates ~~Contents~~

$ in millions	Utility Segment		Competitive Retail			Other			Adjustments and Eliminations			DPL Consolidated
For the three months ended June 30, 2015
Revenues from external customers	$	283.8	$	75.2		$	13.9		$	—		$	372.9
Intersegment revenues	68.3		—			1.3			(69.6		)	—
Total revenues	352.1		75.2			15.2			(69.6		)	372.9
Fuel	50.6		—			3.8			—			54.4
Purchased power	120.1		68.7			0.6			(68.8		)	120.6
Gross margin	$	181.4	$	6.5		$	10.8		$	(0.8	)	$	197.9
Depreciation and amortization	$	34.2	$	0.1		$	—		$	—		$	34.3
Interest expense	$	9.0	$	0.1		$	21.8		$	—		$	30.9
Income tax expense / (benefit)	$	9.4	$	(5.5	)	$	(3.4	)	$	—		$	0.5
Net income / (loss)	$	23.9	$	6.7		$	(8.9	)	$	—		$	21.7
Cash capital expenditures	$	30.2	$	0.1		$	0.8		$	—		$	31.1

In the U.S. there has been a rise in interest rates since 2021, and interest rates are expected to remain volatile in the near term. Although all of our existing AES Ohio long-term debt is at fixed rates, an increase in interest rates can have several impacts on our business. For our existing short-term debt under floating rate structures and any future debt refinancings or future new money financings, rising interest rates will increase future financing costs. Our floating rate debt is currently limited to short-term borrowings under the AES Ohio Credit Agreement and AES Ohio Term Loan Agreement.

$ in millions	Utility Segment			Other			Adjustments and Eliminations			DPL Consolidated
For the six months ended June 30, 2016
Revenues from external customers	$	662.3		$	30.0		$	—		$	692.3
Intersegment revenues	0.6			2.2			(2.8		)	—
Total revenues	662.9			32.2			(2.8		)	692.3
Fuel	118.5			8.6			—			127.1
Purchased power	218.0			1.9			(1.1		)	218.8
Gross margin	$	326.4		$	21.7		$	(1.7	)	$	346.4
Depreciation and amortization	$	71.1		$	(1.7	)	$	—		$	69.4
Fixed-asset impairment	$	857.1		$	(621.6	)	$	—		$	235.5
Interest expense	$	10.7		$	41.3		$	0.3		$	52.3
Income tax expense / (benefit)	$	(291.3	)	$	203.6		$	—		$	(87.7	)
Net income / (loss) from continuing operations	$	(497.9	)	$	363.3		$	—		$	(134.6	)
Discontinued operations, net of tax	$	—		$	29.6		$	—		$	29.6
Net income / (loss)	$	(497.9	)	$	392.9		$	—		$	(105.0	)
Cash capital expenditures	$	71.8		$	7.3		$	—		$	79.1
at June 30, 2016
Total assets	$	2,442.0		$	1,267.7		$	(778.3	)	$	2,931.4

Regulatory

AES Ohio’s facilities and operations are subject to a wide range of regulations and laws by federal, state and local authorities. As well as imposing continuing compliance obligations, these laws and regulations authorize the imposition of substantial penalties for noncompliance, including fines, injunctive relief and other sanctions. In the normal course of business, we have investigatory and remedial activities underway at these facilities and operations in an effort to comply, or to determine compliance, with such regulations. We record liabilities for losses that are probable and can be reasonably estimated. In addition to matters discussed or updated herein, our Form 10-K and Form 10-Q previously filed with the SEC during 2025 describe other regulatory matters, which have not materially changed since those filings.

Ohio Energy Legislation

~~Table~~AES ofOhio ~~Contents~~ESP and Smart Grid Comprehensive Settlement

$ in millions	Utility Segment		Competitive Retail			Other			Adjustments and Eliminations			DPL Consolidated
For the six months ended June 30, 2015
Revenues from external customers	$	634.4	$	197.5		$	35.5		$	—		$	867.4
Intersegment revenues	179.0		—			2.9			(181.9		)	—
Total revenues	813.4		197.5			38.4			(181.9		)	867.4
Fuel	119.9		—			10.9			—			130.8
Purchased power	309.8		180.4			4.8			(180.2		)	314.8
Gross margin	$	383.7	$	17.1		$	22.7		$	(1.7	)	$	421.8
Depreciation and amortization	$	68.9	$	0.4		$	—		$	—		$	69.3
Interest expense	$	17.7	$	0.1		$	43.7		$	(0.1	)	$	61.4
Income tax expense / (benefit)	$	24.2	$	(4.2	)	$	(6.8	)	$	—		$	13.2
Net income / (loss)	$	60.4	$	8.3		$	(18.3	)	$	—		$	50.4
Cash capital expenditures	$	63.3	$	0.3		$	1.2		$	—		$	64.8
at December 31, 2015
Total assets	$	3,359.6	$	—		$	1,304.5		$	(1,339.4	)	$	3,324.7

The OCC has appealed to the Ohio Supreme Court the PUCO’s decision approving the reversion to ESP 1 as well as argued for a refund of the RSC revenue dating back to August 2021. Additionally, the OCC has appealed to the Ohio Supreme Court the PUCO’s decision approving the Smart Grid Comprehensive Settlement as it relates to the 2018 and 2019 SEET. Oral arguments regarding these appeals were held in April 2025, and a court decision is pending.

~~Note~~Smart 11Grid –Phase ~~Discontinued~~2 ~~Operations~~Plan

OnIn ~~January~~February 12024, ~~2016,~~AES ~~DPL~~Ohio ~~closed~~filed ona ~~the~~Smart ~~sale~~Grid ofPhase ~~DPLER,~~2 ~~its~~with ~~competitive~~the ~~retail~~PUCO ~~business. The~~proposing ~~sale~~a ~~agreement~~ten-year ~~was~~investment ~~signed~~plan onto ~~December~~begin ~~28,~~after ~~2015~~Smart ~~and~~Grid ~~DPL~~Phase ~~received~~1 ~~$75~~ends.5 ~~million~~On ofSeptember ~~restricted~~13, ~~cash~~2024, onAES ~~December~~Ohio ~~31,~~reached ~~2015~~a ~~for~~settlement with the ~~sale. This~~PUCO ~~amount~~staff ~~was~~and ~~shown~~other asparties ~~Restricted~~on ~~cash~~the ~~with~~pending ~~the~~Smart ~~associated~~Grid ~~liability~~Phase ~~shown~~2 asapplication ~~"Deposit~~and ~~received~~an evidentiary hearing was held on ~~sale~~October 29, 2024. A fundamental premise of ~~DPLER"~~the onApplication was the ~~Balance~~continued ~~Sheet~~availability asof rider recovery of ~~December~~Smart ~~31,~~Grid ~~2015~~investments through the plan period. ~~Assets~~ ~~and~~However, ~~liabilities~~with ~~related~~the torecent ~~DPLER~~enactment ~~were~~of ~~reclassified~~Sub. toHB ~~"Assets~~15 ~~held~~described ~~for~~above, ~~sale"~~which ~~and~~prohibits ~~"Liabilities~~AES ~~held~~Ohio from applying for ~~sale"~~a innew ~~the~~electric ~~December~~security ~~31,~~plan ~~2015~~which ~~Condensed~~includes ~~Consolidated~~certain ~~Balance~~rider ~~Sheet. DPL~~recovery ~~recorded~~mechanisms, aas ~~gain~~well onas ~~this~~the ~~transaction~~near-term offinancial ~~$49.2~~uncertainty ~~million~~created inby the ~~first~~statute, ~~quarter~~AES ofOhio ~~2016. The~~withdrew ~~gain~~its ~~includes~~Smart ~~the~~Grid ~~impact~~Phase of2 ~~DPLER’s~~Application ~~liability~~on toMay ~~DP&L~~23, ~~that~~2025. ~~transferred~~On ~~with~~July 9, 2025, the ~~sale~~PUCO onapproved ~~January~~the 1,withdrawal ~~2016~~and ~~but~~closed ~~was~~the ~~eliminated~~case. inThis ~~consolidation~~withdrawal atwill ~~December~~provide ~~31,~~AES ~~2015. Deferred~~Ohio ~~taxes~~flexibility as to the timing and ~~intercompany~~scope ~~balances~~of ~~were~~Smart ~~not~~Grid ~~reclassified~~investments to ~~held~~continue ~~for~~to ~~sale~~deliver benefits to customers.

~~Operating~~2024 ~~activities~~Distribution ~~related~~Rate toCase ~~DPLER~~application ~~have been reclassified to "Discontinued operations" in the Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2015.~~

On November 29, 2024, AES Ohio filed a distribution rate case with the PUCO. The investments reflected in this distribution rate case include investments to enhance the safety, reliability, and resilience of the distribution system. Among other matters, the application requests:

•An increase to its annual distribution revenue requirement of $235.2 million, which incorporates certain investments that are currently recovered through the Distribution Investment Rider;

•A return on equity of 10.95% and a cost of long-term debt of 4.49% on a distribution rate base of $1.3 billion and based on a capital structure of 53.87% equity and 46.13% long-term debt; and

•A date certain of September 30, 2024 and a test period of June 1, 2024 – May 31, 2025

The rate case application also includes a proposal for increased tree-trimming expenses. On June 27, 2025, the PUCO Staff submitted their Report and Recommendations; the PUCO has set the evidentiary hearing to begin September 9, 2025 and public hearings to be held on August 7 and August 14, 2025.

See PART I, ITEM 1., Note 2. Regulatory Matters of AES Ohio's Condensed Financial Statements for further information regarding these and other regulatory matters.

Environmental

We have several pending environmental matters associated with our previously-owned stations. Some of these matters could have a material adverse effect on our results of operations, financial condition and cash flows.

As a result of AES Ohio no longer directly owning or operating any generating stations, the following environmental matters, regulations and requirements are not expected to have a material impact on AES Ohio:

•MATS and any associated regulatory or judicial processes;

•NAAQS; and

•recently finalized CAA Section 111(d) regulations for greenhouse gases from existing electric generating units.

Trump Administration Actions Affecting Environmental Regulations

On January 20, 2025, President Trump issued an Executive Order titled “Unleashing American Energy” directing Agencies to, among other tasks, review regulations issued under the prior administration to determine whether they should be suspended, revised, or rescinded. The Trump Administration also issued a memorandum titled

~~Table~~“Regulatory Freeze Pending Review” directing agencies to refrain from proposing or issuing any rules until the Trump Administration has reviewed and approved those rules. In accordance with these and other Trump Administration Executive Orders, on March 12, 2025, EPA released a list of ~~Contents~~environmental regulations that will be targeted for reconsideration and other deregulatory action. These and other actions, including other Executive Orders and directives from the Trump Administration, may have an impact on regulations that may affect our business, financial condition, or results of operations.

~~The~~Clean ~~following~~Water ~~table~~Act ~~summarizes~~- ~~the~~Regulation ~~major categories~~ of ~~assets,~~Water ~~liabilities at the dates indicated, and the revenues, cost of revenues, operating expenses and income tax of discontinued operations for the periods indicated:~~Discharge

$ in millions									December 31, 2015
Accounts receivable, net									$	31.0
Property, plant & equipment, net									4.6
Intangible assets, net									24.6
Other assets									2.0
Total assets of the disposal group classified as held for sale in the balance sheets									$	62.2
Accounts payable									$	0.8
Other liabilities									0.8
Total liabilities of the disposal group classified as held for sale in the balance sheets									$	1.6
	Three months ended June 30,					Six months ended June 30,
	2016		2015			2016			2015
Revenues	$	—	$	75.2		$	—		$	197.5
Cost of revenues	—		(68.8		)	—			(180.5		)
Operating expenses	—		(4.8		)	(0.7		)	(11.8		)
(Loss) / income from discontinued operations before income taxes	—		1.6			(0.7		)	5.2
Gain from disposal of discontinued operations	—		—			49.2			—
Income tax expense / (benefit)	—		(5.3		)	18.9			(3.6		)
Income on discontinued operations	$	—	$	6.9		$	29.6		$	8.8

The concept of "Waters of the U.S." ("WOTUS") defines the geographic reach and authority of the U.S. Army Corps of Engineers and the EPA (the "Agencies") to regulate streams, wetlands, and other water bodies under the CWA. There have been multiple Supreme Court decisions and dueling regulatory definitions over the past several years concerning the proper standard for how to properly determine whether a wetland or stream that is not navigable is considered a WOTUS. On May 25, 2023, the U.S. Supreme Court rendered a decision (the "Decision") in the case of Sackett v. Environmental Protection Agency, addressing the definition of WOTUS with regards to the CWA. The Decision provides a clear standard that substantially restricts the Agencies' ability to regulate certain types of wetlands and streams. Specifically, wetlands that do not have a continuous surface connection with traditional interstate navigable waters is not federally jurisdictional.

~~DPLER~~On ~~purchased~~September ~~its~~8, ~~power~~2023, ~~from~~the ~~DP&L~~Agencies ~~during~~published ~~2015~~final rule amendments in the Federal Register to amend the final “Revised Definition of ‘Waters of the United States’” rule. ~~Prior~~ This final rule conforms the definition of WOTUS to ~~DPLER~~the ~~being~~definition ~~presented~~adopted asin athe ~~discontinued~~Decision. ~~operation~~The Agencies have amended key aspects of the regulatory text to conform the rule to the Decision. On March 12, ~~this~~2025, ~~purchased~~the ~~power~~Agencies issued a joint guidance memorandum for implementing the “continuous surface connection” consistent with the Decision and ~~DP&L's~~related ~~corresponding~~issues. The ~~wholesale~~Federal ~~revenue~~Register ~~would~~notice was published on March 24, 2025 outlining a process to gather recommendations for implementation of WOTUS. It is too early to determine whether any outcome of litigation or current or future revisions to rules interpreting federal jurisdiction over waters over the U.S. may have ~~been~~a ~~eliminated~~material inadverse ~~consolidation~~effect on our results of operations, financial condition and cash flows.

~~Cash~~Regulation ~~flows related to discontinued operations are included in our Condensed Consolidated Statements~~ of Cash Flows. Cash flows from operating activities for discontinued operations were $(0.7) million and $20.5 million for the six months ended June 30, 2016 and 2015, respectively. Cash flows from investing activities for discontinued operations were $75.5 million and $1.0 million for the six months ended June 30, 2016 and 2015, respectively. All cash generated from discontinued operations was paid to DPL through dividends for all periods presented.CCR

On October 19, 2015, an EPA rule regulating CCR under the Resource Conservation and Recovery Act as nonhazardous solid waste became effective ("CCR Rule"). The rule established nationally applicable minimum criteria for the disposal of CCR in new and currently operating landfills and surface impoundments, including location restrictions, design and operating criteria, groundwater monitoring, corrective action and closure requirements and post-closure care. The 2016 Water Infrastructure Improvements for the Nation Act ("WIIN Act"), includes provisions to implement the CCR Rule through a state permitting program, or if the state chooses not to participate, a possible federal permit program. The EPA has indicated that they will implement a phased approach to amending the CCR Rule, which is ongoing. On February 20, 2020, the EPA published a proposed rule to establish a federal CCR permit program that would operate in states without approved CCR permit programs. With the sale of our coal-fired generating stations, we expect that the impact of these regulations would be limited to our interest in OVEC.

On August 28, 2020, the EPA published the CCR Part A Rule that, among other amendments, required certain CCR units to cease waste receipt and initiate closure by April 11, 2021. The CCR Part A Rule also allowed for extensions of the April 11, 2021 deadline if EPA determines certain criteria are met. Facilities seeking such an extension were required to submit a demonstration to EPA by November 30, 2020. On January 11, 2022, EPA released its first in a series of proposed determinations regarding nine CCR Part A Rule demonstrations, including for OVEC’s Clifty Creek and four compliance-related letters notifying certain other facilities of their compliance obligations under the federal CCR regulations. The determinations and letters include interpretations regarding implementation of the CCR Rule. On April 8, 2022, petitions for review were filed challenging these EPA actions. The petitions were consolidated in Electric Energy, Inc. v. EPA. On June 28, 2024, the court dismissed the petitions for review, finding that the EPA actions were an application of the existing CCR regulations. It is too early to determine the direct or indirect impact of this ruling or if additional litigation might be pursued.

On May 8, 2024, the EPA published final revisions to the CCR Rule, which were effective on November 8, 2024. The final revisions expand the scope of CCR units regulated by the CCR Rule to include legacy surface impoundments, inactive surface impoundments, and CCR management units. The May 8, 2024 revisions to the CCR Rule are currently subject to legal challenges and on November 1, 2024, the D.C. Circuit Court denied a

~~Table~~motion to stay these revisions to the CCR Rule. On November 5, 2024, an application for stay of ~~Contents~~the CCR Rule revisions was filed with the U. S. Supreme Court, which was denied by the court on December 11, 2024. On July 22, 2025, EPA published both a direct final rule and a proposed rule that, if finalized, would extend certain deadlines for coal combustion residual management units associated with its May 8, 2024 revisions to the CCR Rule. It is too early to determine any potential impact from these revisions to the CCR Rule.

~~Note~~CAPITAL 12RESOURCES –AND ~~Fixed-asset Impairment~~LIQUIDITY

During the second quarter of 2016, we tested the recoverability of our long-lived assets at certain of our generation facilities at DP&L. A ruling by the Supreme Court of Ohio on June 20, 2016, lower expectation of future capacity revenue resulting from the most recent PJM capacity auction and a higher anticipated level of environmental compliance costs resulting from third party studies were collectively determined to be an impairment indicator for these assets. We performed a long-lived asset impairment analysis and determined that the carrying amount of Killen and certain DP&L peaking generating facilities were not recoverable. The asset groups of Killen and these DP&L peaking generating facilities were determined to have fair values of $84.3 million and $5.2 million, respectively, using the discounted cash flows under the income approach. As a result, we recognized an asset impairment expense of $230.8 million and $4.7 million for Killen and these DP&L peaking generating facilities, respectively.OVERVIEW

AES Ohio had unrestricted cash and cash equivalents of $37.8 million as of June 30, 2025. At that date, AES Ohio did not have any short-term investments. AES Ohio had aggregate principal amounts of long-term debt outstanding of $1,021.5 million.

From time to time, we may elect to repurchase our outstanding debt through cash purchases, privately negotiated transactions or otherwise when management believes such repurchases are favorable to make. The amounts involved in any such repurchases may be material.

We depend on timely and continued access to capital markets to manage our liquidity needs. The inability to raise capital on favorable terms, to refinance existing indebtedness or to fund operations and other commitments during times of political or economic uncertainty could have a material adverse effect on our results of operations, financial condition and cash flows. In addition, changes in the timing of tariff increases or delays in regulatory determinations could affect the cash flows and results of operations of our businesses. AES Ohio must first seek approval from the PUCO to issue new stocks, bonds, notes and other evidences of indebtedness. AES Ohio last received approval in July 2025 to, among other things, issue up to $450 million of long-term indebtedness.

CASH FLOWS

DPL’s financial condition, liquidity and capital requirements include the consolidated results of its principal subsidiary AES Ohio. All material intercompany accounts and transactions have been eliminated in consolidation.

Cash Flow Analysis

The following table summarizes the cash flows:


	Six months ended June 30,				$ change
$ in millions	2025		2024		2025 vs. 2024
Net cash provided by operating activities	$	7.3	$	81.7	$	(74.4)
Net cash used in investing activities	(163.4)		(304.0)		140.6
Net cash provided by financing activities	169.3		229.0		(59.7)
Net increase in cash, cash equivalents and restricted cash	13.2		6.7		6.5
Balance at beginning of period	24.7		15.6		9.1
Cash, cash equivalents and restricted cash at end of period	$	37.9	$	22.3	$	15.6

The following cash flow review compares the cash flows of AES Ohio for the six months ended June 30, 2025 to the cash flows for the six months ended June 30, 2024.

Operating activities


	Six months ended June 30,				$ change
$ in millions	2025		2024		2025 vs. 2024
Net income	$	16.2	$	24.5	$	(8.3)
Depreciation and amortization	57.8		42.8		15.0
Deferred income taxes	2.8		6.1		(3.3)
Other adjustments to net income	0.7		(2.2)		2.9
Net income, adjusted for non-cash items	77.5		71.2		6.3
Net change in operating assets and liabilities and other	(70.2)		10.5		(80.7)
Net cash provided by operating activities	$	7.3	$	81.7	$	(74.4)

~~Table~~The ofnet ~~Contents~~change in operating assets and liabilities during the six months ended June 30, 2025, compared to the six months ended June 30, 2024, was driven by the following:

FINANCIAL STATEMENTS


$ in millions	$ Change
Decrease from accounts payable primarily due to the timing of invoices and payments	$	(39.9)

Decrease from higher net accounts receivable driven by timing of collections, billing delays and a temporary pause of customer disconnections and certain collection efforts and write-off processes after the implementation of AES Ohio's customer billing system upgrade in the third quarter of 2024	(29.2)
Decrease from changes in interest accruals on outstanding debt in the comparable periods	(5.9)
Other	(5.7)
Net change in operating assets and liabilities and other	$	(80.7)

~~The~~Investing ~~Dayton Power and Light Company~~activities

Net cash used in investing activities decreased $140.6 million during the six months ended June 30, 2025, compared to the six months ended June 30, 2024, primarily driven by the following:


$ in millions	$ Change
Lower capital expenditures on AES Ohio T&D projects primarily due to timing of invoices and payments in the comparative periods and lower digital related investment due to the implementation of AES Ohio's customer billing system upgrade in the third quarter of 2024	$	130.6
Lower cost of removal payments	9.8

Other	0.2
Net change in investing activities	$	140.6

Financing activities

Net cash provided by financing activities decreased $59.7 million during the six months ended June 30, 2025, compared to the six months ended June 30, 2024, primarily driven by the following:


$ in millions	$ Change
Decrease due to higher net repayments on AES Ohio's revolving credit facility	$	(100.0)

Increase due to lower distributions to parent in the comparable periods	21.0


Increase due to higher equity contributions from parent in the comparable periods	20.0
Other	(0.7)
Net change in financing activities	$	(59.7)

LIQUIDITY

We expect our existing cash balances, cash generated from operating activities and borrowing capacity on our existing credit facilities will be adequate to meet our anticipated operating needs, including interest expense on our debt and any dividends to our equity owners. Our business is capital intensive, requiring significant resources to fund operating expenses, construction expenditures, scheduled debt maturities and carrying costs, taxes and any dividend payments. For 2025 and subsequent years, we expect to satisfy these requirements with a combination of cash from operations, funds from debt financing and funds from capital contributions as our internal liquidity needs and market conditions warrant. We also expect that the borrowing capacity under the AES Ohio Credit Agreement will continue to be available to manage working capital requirements during those periods. The absence of adequate liquidity could adversely affect our ability to operate our business and have a material adverse effect on our results of operations, financial condition and cash flows.

At June 30, 2025, AES Ohio has access to the following revolving credit facility:

$ in millions

Type

Maturity

Commitment

Amounts available as of June 30, 2025

AES Ohio Credit Agreement

Revolving

March 2030

350.0

190.0

For the AES Ohio Credit Agreement, as of June 30, 2025, there were $160.0 million in borrowings under the facility, with the remaining $190.0 million available to AES Ohio. For more information on the AES Ohio Credit Agreement, see Note 5. Debt of our Form 10-K.

~~Table~~CAPITAL ofEXPENDITURE ~~Contents~~PROGRAM

THE DAYTON POWER AND LIGHT COMPANY
CONDENSED STATEMENTS OF OPERATIONS
	Three months endedJune 30,						Six months endedJune 30,
$ in millions	2016			2015			2016			2015
Revenues	$	313.7		$	352.1		$	662.9		$	813.4
Cost of revenues:
Fuel	55.6			50.6			118.5			119.9
Purchased power	96.7			120.1			218.0			309.8
Total cost of revenues	152.3			170.7			336.5			429.7
Gross margin	161.4			181.4			326.4			383.7
Operating expenses:
Operation and maintenance	76.4			83.7			162.5			168.1
Depreciation and amortization	36.8			34.2			71.1			68.9
General taxes	21.1			21.4			41.6			43.9
Gain on termination of contract	—			—			(27.7		)	—
Fixed-asset impairment	857.1			—			857.1			—
Other	0.1			—			0.2			0.4
Total operating expenses	991.5			139.3			1,104.8			281.3
Operating income / (loss)	(830.1		)	42.1			(778.4		)	102.4
Other income / (expense), net:
Investment income	0.3			0.3			0.2			0.2
Interest expense	(5.4		)	(9.0		)	(10.7		)	(17.7		)
Other expense	(0.1		)	(0.1		)	(0.3		)	(0.3		)
Total other expense, net	(5.2		)	(8.8		)	(10.8		)	(17.8		)
Earnings / (loss) before income taxes	(835.3		)	33.3			(789.2		)	84.6
Income tax expense / (benefit)	(303.7		)	9.4			(291.3		)	24.2
Net income / (loss)	(531.6		)	23.9			(497.9		)	60.4
Dividends on preferred stock	0.2			0.2			0.4			0.4
Income / (loss) attributable to common stock	$	(531.8	)	$	23.7		$	(498.3	)	$	60.0

Our capital expenditure program, including development and permitting costs, for the three-year period from 2025 through 2027 is currently estimated to cost up to $1.3 billion, and includes estimates as follows:

See Notes to Condensed Financial Statements.


$ in millions	2025		2026		2027		For the three-year period from 2025 through 2027
Distribution-related additions, improvements and extensions	$	188.0	$	172.0	$	176.0	$	536.0
Transmission-related additions and improvements	193.0		262.0		231.0		686.0
Smart Grid Phase 1 improvements and additions	35.0		—		—		35.0

Other	16.0		13.0		9.0		38.0
Total for AES Ohio	432.0		447.0		416.0		1,295.0

Other subsidiaries	3.0		6.0		6.0		15.0
Total for DPL	$	435.0	$	453.0	$	422.0	$	1,310.0

~~These~~AES ~~interim~~Ohio's ~~statements~~projection includes expected spending under its Smart Grid Phase 1 included in the comprehensive settlement approved by the PUCO on June 16, 2021, as well as new transmission and distribution projects. With the recent enactment of Sub. HB 15, AES Ohio withdrew its Smart Grid Phase 2 Application and is currently reevaluating its capital expenditure programs. AES Ohio’s spending programs are ~~unaudited~~contingent on, among other events, successful regulatory outcomes in pending proceedings. See more information in Note 2. Regulatory Matters of AES Ohio's Condensed Financial Statements.

39AES Ohio is subject to the mandatory reliability standards of NERC and ReliabilityFirst Corporation, one of the six NERC regions, of which AES Ohio is a member. Anticipated costs related to these standards are included in the overall capital projections above.

Table of Contents

THE DAYTON POWER AND LIGHT COMPANY
CONDENSED STATEMENTS OF COMPREHENSIVE INCOME / (LOSS)
	Three months endedJune 30,						Six months endedJune 30,
$ in millions	2016			2015			2016			2015
Net income / (loss)	$	(531.6	)	$	23.9		$	(497.9	)	$	60.4
Available-for-sale securities activity:
Change in fair value of available-for-sale securities, net of income tax (expense) / benefit of $0.0, $0.2, $(0.1) and $0.0 for each respective period	(0.1		)	(0.5		)	0.1			—
Reclassification to earnings, net of income tax expense of $0.0, $(0.2), $0.0 and $0.0 for each respective period	0.1			0.4			—			—
Total change in fair value of available-for-sale securities	—			(0.1		)	0.1			—
Derivative activity:
Change in derivative fair value, net of income tax (expense) / benefit of $4.7, $(1.0), $(7.0) and $(1.0) for each respective period	(8.5		)	1.7			13.0			1.8
Reclassification to earnings, net of income tax benefit of $5.9, $1.0, $10.5 and $0.7 for each respective period	(10.8		)	(1.8		)	(19.2		)	(1.3		)
Total change in fair value of derivatives	(19.3		)	(0.1		)	(6.2		)	0.5
Pension and postretirement activity:
Reclassification to earnings, net of income tax expense of $(0.4), $(0.5), $(1.2) and $(1.0) for each respective period	0.7			0.9			1.0			1.8
Total change in unfunded pension obligation	0.7			0.9			1.0			1.8
Other comprehensive income / (loss)	(18.6		)	0.7			(5.1		)	2.3
Net comprehensive income / (loss)	$	(550.2	)	$	24.6		$	(503.0	)	$	62.7

See Notes to Condensed Financial Statements.

These interim statements are unaudited.

Table of Contents

THE DAYTON POWER AND LIGHT COMPANY
CONDENSED BALANCE SHEETS
	June 30,			December 31,
$ in millions	2016			2015
ASSETS
Current assets:
Cash and cash equivalents	$	45.4		$	5.4
Restricted cash	33.2			44.8
Accounts receivable, net (Note 2)	105.6			119.5
Inventories (Note 2)	86.4			108.0
Taxes applicable to subsequent years	38.5			79.2
Regulatory assets, current	0.3			14.4
Other prepayments and current assets	50.1			46.3
Total current assets	359.5			417.6
Property, plant & equipment:
Property, plant & equipment	3,051.5			5,244.7
Less: Accumulated depreciation and amortization	(1,262.6		)	(2,584.0		)
	1,788.9			2,660.7
Construction work in process	84.0			78.0
Total net property, plant & equipment	1,872.9			2,738.7
Other non-current assets:
Regulatory assets, non-current	186.1			179.9
Intangible assets, net of amortization	0.9			5.0
Other deferred assets	22.6			18.4
Total other non-current assets	209.6			203.3
Total assets	$	2,442.0		$	3,359.6
LIABILITIES AND SHAREHOLDER'S EQUITY
Current liabilities:
Current portion of long-term debt (Note 5)	$	444.6		$	443.1
Short-term debt (Note 10)	—			35.0
Accounts payable	75.7			94.1
Accrued taxes	85.5			86.2
Accrued interest	4.4			4.1
Security deposits	15.2			15.1
Regulatory liabilities, current	29.9			24.4
Other current liabilities	64.0			51.0
Advance on contract termination	—			27.7
Total current liabilities	719.3			780.7
Non-current liabilities:
Long-term debt (Note 5)	313.8			313.6
Deferred taxes	318.4			631.2
Taxes payable	38.0			82.1
Regulatory liabilities, non-current	128.7			127.0
Pension, retiree and other benefits	79.9			87.1
Unamortized investment tax credit	18.8			20.0
Other deferred credits	85.4			82.3
Total non-current liabilities	983.0			1,343.3
Redeemable preferred stock	22.9			22.9
Commitments and contingencies (Note 9)
Common shareholder's equity:
Common stock, at par value of $0.01 per share	0.4			0.4
Other paid-in capital	811.2			803.7
Accumulated other comprehensive loss	(33.8		)	(28.7		)
Retained earnings / (Accumulated deficit)	(61.0		)	437.3
Total common shareholder's equity	716.8			1,212.7
Total liabilities and shareholder's equity	$	2,442.0		$	3,359.6

See Notes to Condensed Financial Statements.

These interim statements are unaudited.

Table of Contents

THE DAYTON POWER AND LIGHT COMPANY
CONDENSED STATEMENTS OF CASH FLOWS
	Six months ended June 30,
$ in millions	2016			2015
Cash flows from operating activities:
Net income / (loss)	$	(497.9	)	$	60.4
Adjustments to reconcile net income / (loss) to net cash from operating activities:
Depreciation and amortization	71.1			68.9
Deferred income taxes	(308.7		)	(11.6		)
Fixed-asset impairment	857.1			—
Changes in certain assets and liabilities:
Accounts receivable	20.5			16.2
Inventories	21.6			(4.7		)
Prepaid taxes	2.7			(0.2		)
Taxes applicable to subsequent years	40.7			37.4
Deferred regulatory costs, net	8.0			21.3
Accounts payable	(13.8		)	3.3
Accrued taxes payable	(43.3		)	(8.0		)
Accrued interest payable	0.2			—
Pension, retiree and other benefits	(4.2		)	3.8
Other	5.5			(18.9		)
Net cash provided by operating activities	159.5			167.9
Cash flows from investing activities:
Capital expenditures	(71.8		)	(63.3		)
Purchase of renewable energy credits	(0.3		)	(0.2		)
Increase in restricted cash	(16.1		)	(8.4		)
Insurance proceeds	3.4			3.8
Other investing activities, net	0.8			0.4
Net cash used in investing activities	(84.0		)	(67.7		)
Cash flows from financing activities:
Dividends paid on common stock to parent	—			(20.0		)
Borrowings from revolving credit facilities	—			15.0
Repayment of borrowings from revolving credit facilities	—			(15.0		)
Dividends paid on preferred stock	(0.4		)	(0.4		)
Issuance of short-term debt - related party	5.0			—
Repayment of short-term debt - related party	(40.0		)	(0.1		)
Other financing activities, net	(0.1		)	—
Net cash used in financing activities	(35.5		)	(20.5		)
Cash and cash equivalents:
Net change	40.0			79.7
Balance at beginning of period	5.4			5.4
Cash and cash equivalents at end of period	$	45.4		$	85.1
Supplemental cash flow information:
Interest paid, net of amounts capitalized	$	8.0		$	13.5
Income taxes paid, net	$	0.1		$	0.5
Non-cash financing and investing activities:
Accruals for capital expenditures	$	8.3		$	10.0

See Notes to Condensed Financial Statements.

These interim statements are unaudited.

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The Dayton Power and Light Company

Notes to Condensed Financial Statements (Unaudited)

Note 1 – Overview and Summary of Significant Accounting Policies

Description of Business

DP&L employed 1,161 people as of June 30, 2016. Approximately 61% of all employees are under a collective bargaining agreement which expires on October 31, 2017.

Financial Statement Presentation

DP&L does not have any subsidiaries. DP&L has undivided ownership interests in five coal-fired generating facilities, peaking electric generating facilities and numerous transmission facilities, all of which are included in the financial statements at amortized cost. Operating revenues and expenses of these facilities are included on a pro rata basis in the corresponding lines in the Condensed Statements of Operations.

Certain immaterial amounts from prior periods have been reclassified to conform to the current period presentation.

These financial statements have been prepared in accordance with GAAP for interim financial statements, the instructions of Form 10-Q and Regulation S-X. Accordingly, certain information and footnote disclosures normally included in the annual financial statements prepared in accordance with GAAP have been omitted from this interim report. Therefore, our interim financial statements in this report should be read along with the annual financial statements included in our Form 10-K for the fiscal year ended December 31, 2015.

In the opinion of our management, the Condensed Financial Statements presented in this report contain all adjustments necessary to fairly state our financial position as of June 30, 2016; our results of operations for the three and six months ended June 30, 2016 and 2015 and our cash flows for the six months ended June 30, 2016 and 2015. Unless otherwise noted, all adjustments are normal and recurring in nature. Due to various factors, including, but not limited to, seasonal weather variations, the timing of outages of EGUs, changes in economic conditions involving commodity prices and competition, and other factors, interim results for the six months ended June 30, 2016 may not be indicative of our results that will be realized for the full year ending December 31, 2016.

The preparation of financial statements in conformity with GAAP requires us to make estimates and judgments that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the revenues and expenses of the periods reported. Actual results could differ from these estimates. Significant items subject to such estimates and judgments include: the carrying value of property, plant and equipment; unbilled revenues; the valuation of derivative instruments; the valuation of insurance and claims liabilities; the valuation of allowances for receivables and deferred income taxes; regulatory assets and liabilities; liabilities recorded for

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income tax exposures; litigation; contingencies; the valuation of AROs; and assets and liabilities related to employee benefits.

Accounting for Taxes Collected from Customers and Remitted to Governmental Authorities

DP&L collects certain excise taxes levied by state or local governments from its customers. These taxes are accounted for on a net basis and not included in revenue. The amounts of such taxes collected for the three months ended June 30, 2016 and 2015 were $11.6 million and $11.5 million, respectively. The amounts of such taxes collected for the six months ended June 30, 2016 and 2015 were $24.5 million and $25.5 million, respectively.

New Accounting Pronouncements

The following table provides a brief description of recent accounting pronouncements that could have a material impact on our financial statements:

Accounting Standard	Description	Date of Adoption	Effect on the financial statements upon adoption
New Accounting Standards Adopted
ASU No. 2015-15, Interest - Imputation of Interest (Subtopic 835-30): Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements	Given the absence of authoritative guidance within ASU 2015-03, this standard clarifies that the SEC Staff would not object to an entity presenting debt issuance costs related to line-of-credit arrangements as an asset that is subsequently amortized ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. Transition method: retrospective.	January 1, 2016	Deferred financing costs related to lines-of-credit of approximately $0.7 million recorded within Other deferred assets were not reclassified.
ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30)	The standard simplifies the presentation of debt issuance costs by requiring that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The recognition and measurement guidance for debt issuance costs are not affected by the standard. Transition method: retrospective.	January 1, 2016	Deferred financing costs of approximately $1.8 million previously classified within Other prepayments and current assets and $4.5 million previously classified within Other deferred assets were reclassified to reduce the related debt liabilities.
ASU No. 2015-02, Consolidation - Amendments to the Consolidation Analysis (Topic 810)	The standard makes targeted amendments to the current consolidation guidance and ends the deferral granted to investment companies from applying the VIE guidance. The standard amends the evaluation of whether (1) fees paid to a decision-maker or service providers represent a variable interest, (2) a limited partnership or similar entity has the characteristics of a VIE and (3) a reporting entity is the primary beneficiary of a VIE. Transition method: retrospective.	January 1, 2016	There were no changes to the consolidation conclusions.
New Accounting Standards Issued But Not Yet Effective
2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments	This standard updates the impairment model for financial assets measured at amortized cost to an expected loss model rather than an incurred loss model. It also allows for the presentation of credit losses on available-for-sale debt securities as an allowance rather than a write down. Transition method: various.	January 1, 2020 Early adoption is permitted only as of January 1, 2019.	We are currently evaluating the impact of adopting the standard on our financial statements.
2016-09, Compensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting	The standard simplifies the following aspects of accounting for share-based payment awards: accounting for income taxes, classification of excess tax benefits on the statement of cash flows, forfeitures, statutory tax withholding requirements, classification of awards as either equity or liabilities and classification of employee taxes paid on statement of cash flows when an employer withholds shares for tax-withholding purposes. Transition method: Various.	January 1, 2017. Early adoption is permitted.	We are currently evaluating the impact of adopting the standard on our financial statements.

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Accounting Standard	Description	Date of Adoption	Effect on the financial statements upon adoption
ASU No. 2016-06, Derivatives and Hedging (Topic 815) - Contingent Put and Call Options in Debt Instruments	This standard clarifies the requirements for assessing whether contingent call (put) options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. When a call (put) option is contingently exercisable, an entity no longer has to assess whether the event that triggers the ability to exercise a call (put) option is related to interest rates or credit risks. Transition method: a modified retrospective basis to existing debt instruments as of the effective date.	January 1, 2017. Early adoption is permitted.	We are currently evaluating the impact of adopting the standard, but do not anticipate a material impact on our financial statements.
ASU No. 2016-05, Derivatives and Hedging (Topic 815) - Effect of Derivative Contract Novations on Existing Hedge Accounting Relationships	The standard clarifies that a change in the counterparty to a derivative instrument that has been designated as the hedging instrument under Topic 815 does not require de-designation of that hedging relationship provided that all other hedge accounting criteria (including those in paragraphs 815-20-35-14 through 35-18) continue to be met. Transition method: prospective or a modified retrospective basis.	January 1, 2017. Early adoption is permitted.	We are currently evaluating the impact of adopting the standard, but do not anticipate a material impact on our financial statements.
ASU No. 2016-02, Leases (Topic 842)	The standard creates Topic 842, Leases which supersedes Topic 840, Leases, and introduces a lessee model that brings substantially all leases onto the balance sheet while retaining most of the principles of the existing lessor model in U.S. GAAP and aligning many of those principles with ASC 606, Revenue from Contracts with Customers. Transition method: modified retrospective approach with certain practical expedients.	January 1, 2019. Early adoption is permitted.	We are currently evaluating the impact of adopting the standard on our financial statements.
ASU No. 2016-01, Financial Instruments - Overall (Topic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities	The standard significantly revises an entity’s accounting related to (1) the classification and measurement of investments in equity securities and (2) the presentation of certain fair value changes for financial liabilities measured at fair value. Also, it amends certain disclosure requirements associated with the fair value of financial instruments. Transition: cumulative effect in Retained Earnings as of adoption or prospectively for equity investments without readily determinable fair value.	January 1, 2018. Limited early adoption permitted.	We are currently evaluating the impact of adopting the standard, but do not anticipate a material impact on our financial statements.
ASU No. 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory	The standard replaces the current lower of cost or market test with a lower of cost or net realizable value test. Transition method: prospectively.	January 1, 2017. Early adoption is permitted.	We are currently evaluating the impact of adopting the standard on our financial statements.
ASU Nos. 2014-09, 2016-08, 2016-10, 2016-12 Revenue from Contracts with Customers (Topic 606)	The Revenue from Contracts with Customers standard provides a single and comprehensive revenue recognition model for all contracts with customers to improve comparability. The revenue standard contains principles that an entity will apply to determine the measurement of revenue and timing revenue recognition. The standard requires an entity to recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. The amendments to the standard provide further clarification on contract revenue recognition specifically related to the implementation of the principal versus agent evaluation, the identification of performance obligations, clarification on accounting for licenses of intellectual property, and allows for the election to account for shipping and handling activities performed after control of a good has been transferred to the customer as a fulfillment cost. Transition method: a full retrospective or modified retrospective approach.	January 1, 2018 (deferred by ASU No. 2015-14). Earlier application is permitted only as of January 1, 2017.	We are currently evaluating the impact of adopting the standard on our financial statements.

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Note 2 – Supplemental Financial Information

Accounts receivable and Inventories are as follows at June 30, 2016 and December 31, 2015:

	June 30,			December 31,
$ in millions	2016			2015
Accounts receivable, net:
Unbilled revenue	$	38.9		$	43.3
Customer receivables	50.8			54.1
Amounts due from partners in jointly owned plants	10.9			16.0
Other	6.0			6.9
Provision for uncollectible accounts	(1.0		)	(0.8		)
Total accounts receivable, net	$	105.6		$	119.5
Inventories, at average cost:
Fuel and limestone	$	50.0		$	72.2
Plant materials and supplies	34.4			33.7
Other	2.0			2.1
Total inventories, at average cost	$	86.4		$	108.0

Accumulated Other Comprehensive Income / (Loss)

The amounts reclassified out of Accumulated Other Comprehensive Income / (Loss) by component during the three and six months ended June 30, 2016 and 2015 are as follows:

Details about Accumulated Other Comprehensive Income / (Loss) components	Affected line item in the Condensed Statements of Operations	Three months ended						Six months ended
		June 30,						June 30,
$ in millions		2016			2015			2016			2015
Gains and losses on Available-for-sale securities activity (Note 3):
	Other income	$	0.1		$	0.6		$	—		$	—
	Tax benefit	—			(0.2		)	—			—
	Net of income taxes	0.1			0.4			—			—
Gains and losses on cash flow hedges (Note 4):
	Interest expense	(0.3		)	(0.3		)	(0.6		)	(0.6		)
	Revenue	(20.1		)	(2.9		)	(37.2		)	(3.2		)
	Purchased power	3.7			0.4			8.1			1.8
	Total before income taxes	(16.7		)	(2.8		)	(29.7		)	(2.0		)
	Tax expense	5.9			1.0			10.5			0.7
	Net of income taxes	(10.8		)	(1.8		)	(19.2		)	(1.3		)
Amortization of defined benefit pension items (Note 7):
	Operation and maintenance	1.1			1.4			2.2			2.8
	Tax benefit	(0.4		)	(0.5		)	(1.2		)	(1.0		)
	Net of income taxes	0.7			0.9			1.0			1.8
Total reclassifications for the period, net of income taxes		$	(10.0	)	$	(0.5	)	$	(18.2	)	$	0.5

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The changes in the components of Accumulated Other Comprehensive Income / (Loss) during the six months ended June 30, 2016 are as follows:

$ in millions	Gains / (losses) on available-for-sale securities		Gains / (losses) on cash flow hedges			Change in unfunded pension obligation			Total
Balance January 1, 2016	$	0.5	$	11.2		$	(40.4	)	$	(28.7	)
Other comprehensive income before reclassifications	0.1		13.0			—			13.1
Amounts reclassified from accumulated other comprehensive income / (loss)	—		(19.2		)	1.0			(18.2		)
Net current period other comprehensive income / (loss)	0.1		(6.2		)	1.0			(5.1		)
Balance June 30, 2016	$	0.6	$	5.0		$	(39.4	)	$	(33.8	)

Note 3 – Fair Value

The fair values of our financial instruments are based on published sources for pricing when possible. We rely on valuation models only when no other methods exist. The value of our financial instruments represents our best estimates of the fair value, which may not be the value realized in the future.

The following table presents the fair value, carrying value and cost of our non-derivative instruments at June 30, 2016 and December 31, 2015. Information about the fair value of our derivative instruments can be found in Note 4 – Derivative Instruments and Hedging Activities.

	June 30, 2016				December 31, 2015
$ in millions	Cost		Fair Value		Cost		Fair Value
Assets
Money market funds	$	0.3	$	0.3	$	0.2	$	0.2
Equity securities	2.7		3.5		3.0		3.8
Debt securities	4.2		4.2		4.4		4.3
Hedge funds	0.2		0.2		0.4		0.4
Real estate	0.3		0.4		0.3		0.3
Total assets	$	7.7	$	8.6	$	8.3	$	9.0
	Carrying Value		Fair Value		Carrying Value		Fair Value
Liabilities
Debt	$	758.4	$	764.3	$	756.7	$	764.2

These financial instruments are not subject to master netting agreements or collateral requirements and as such are presented in the Condensed Balance Sheet at their gross fair value, except for Debt, which is presented at amortized carrying value.

Debt

Unrealized gains or losses are not recognized in the financial statements as debt is presented at cost, net of unamortized premium or discount and deferred financing costs in the financial statements. The debt amounts include the current portion payable in the next twelve months and have maturities that range from 2016 to 2061.

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Master Trust Assets

DP&L established Master Trusts to hold assets that could be used for the benefit of employees participating in employee benefit plans and these assets are not used for general operating purposes. These assets are primarily comprised of open-ended mutual funds, which are valued using the net asset value per unit. These investments are recorded at fair value within Other deferred assets on the balance sheets and classified as available-for-sale. Any unrealized gains or losses are recorded in AOCI until the securities are sold.

DP&L had $0.9 million ($0.6 million after tax) of unrealized gains and immaterial unrealized losses on the Master Trust assets in AOCI at June 30, 2016 and $0.8 million ($0.5 million after tax) in unrealized gains and $0.1 million ($0.1 million after tax) in unrealized losses on the Master Trust assets in AOCI at December 31, 2015.

During the six months ended June 30, 2016, $2.0 million ($1.3 million after tax) of various investments were sold to facilitate the distribution of benefits and the unrealized gains were reversed into earnings. An immaterial amount of unrealized gains are expected to be reversed to earnings as investments are sold over the next twelve months to facilitate the distribution of benefits.

Fair Value Hierarchy

Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants on the measurement date. The fair value hierarchy requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. These inputs are then categorized as:

• Level 1 (quoted prices in active markets for identical assets or liabilities);

• Level 2 (observable inputs such as quoted prices for similar assets or liabilities or quoted prices in markets that are not active);

• Level 3 (unobservable inputs).

Valuations of assets and liabilities reflect the value of the instrument including the values associated with counterparty risk. We include our own credit risk and our counterparty’s credit risk in our calculation of fair value using global average default rates based on an annual study conducted by a large rating agency.

We did not have any transfers of the fair values of our financial instruments between Level 1 and Level 2 of the fair value hierarchy during the six months ended June 30, 2016 and 2015.

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The fair value of assets and liabilities at June 30, 2016 and December 31, 2015 and the respective category within the fair value hierarchy for DP&L was determined as follows:

Assets and Liabilities at Fair Value
			Level 1		Level 2		Level 3
$ in millions	Fair value at June 30, 2016		Based on Quoted Prices in Active Markets		Other Observable Inputs		Unobservable Inputs
Assets
Master Trust assets
Money market funds	$	0.3	$	0.3	$	—	$	—
Equity securities	3.5		—		3.5		—
Debt securities	4.2		—		4.2		—
Hedge funds	0.2		—		0.2		—
Real estate	0.4		—		0.4		—
Total Master Trust assets	8.6		0.3		8.3		—
Derivative assets
FTRs	0.1		—		—		0.1
Natural gas futures	0.3		0.3		—		—
Forward power contracts	39.4		—		38.7		0.7
Total derivative assets	39.8		0.3		38.7		0.8
Total assets	$	48.4	$	0.6	$	47.0	$	0.8
Liabilities
Derivative liabilities
Forward power contracts	$	45.3	$	—	$	39.0	$	6.3
Total derivative liabilities	45.3		—		39.0		6.3
Debt	764.3		—		746.3		18.0
Total liabilities	$	809.6	$	—	$	785.3	$	24.3

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Assets and Liabilities at Fair Value
			Level 1		Level 2		Level 3
$ in millions	Fair value at December 31, 2015		Based on Quoted Prices in Active Markets		Other Observable Inputs		Unobservable Inputs
Assets
Master Trust assets
Money market funds	$	0.2	$	0.2	$	—	$	—
Equity securities	3.8		—		3.8		—
Debt securities	4.3		—		4.3		—
Hedge funds	0.4		—		0.4		—
Real estate	0.3		—		0.3		—
Total Master Trust assets	9.0		0.2		8.8		—
Derivative assets
FTRs	0.2		—		—		0.2
Forward power contracts	30.6		—		30.6		—
Total Derivative assets	30.8		—		30.6		0.2
Total assets	$	39.8	$	0.2	$	39.4	$	0.2
Liabilities
Derivative liabilities
FTRs	$	0.5	$	—	$	—	$	0.5
Forward power contracts	27.0		—		23.9		3.1
Total Derivative liabilities	27.5		—		23.9		3.6
Debt	764.2		—		746.1		18.1
Total liabilities	$	791.7	$	—	$	770.0	$	21.7

Our financial instruments are valued using the market approach in the following categories:

• Level 2 inputs are used to value derivatives such as forward power contracts (which are traded on the OTC market but which are valued using prices on the NYMEX for similar contracts on the OTC market). Other Level 2 assets include open-ended mutual funds that are in the Master Trust, which are valued using observable prices based on the end of day net asset value per unit.

• Level 3 inputs such as FTRs are considered a Level 3 input because the monthly auctions are considered inactive. Other Level 3 inputs include the credit valuation adjustment on some of the forward power contracts and forward power contracts in less active markets. Our Level 3 inputs are immaterial to our derivative balances as a whole and as such no further disclosures are presented.

Our debt is fair valued for disclosure purposes only and most of the fair values are determined using quoted market prices in inactive markets. These fair value inputs are considered Level 2 in the fair value hierarchy. As the Wright-Patterson Air Force Base loan is not publicly traded, fair value is assumed to equal carrying value. These fair value inputs are considered Level 3 in the fair value hierarchy as there are no observable inputs. Additional Level 3 disclosures are not presented since debt is not recorded at fair value.

Approximately 93% of the inputs to the fair value of our derivative instruments are from quoted market prices.

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Non-recurring Fair Value Measurements

We use the cost approach to determine the fair value of our AROs, which is estimated by discounting expected cash outflows to their present value at the initial recording of the liability. Cash outflows are based on the approximate future disposal cost as determined by market information, historical information or other management estimates. These inputs to the fair value of the AROs would be considered Level 3 inputs under the fair value hierarchy. AROs for ash ponds, asbestos, river structures and underground storage tanks increased by a net amount of $2.3 million and increased by a net amount of $39.8 million during the six months ended June 30, 2016 and 2015, respectively.

When evaluating impairment of long-lived assets, we measure fair value using the applicable fair value measurement guidance. Impairment expense is measured by comparing the fair value at the evaluation date to the carrying amount. The following table summarizes Long-lived assets measured at fair value on a non-recurring basis during the period and their level within the fair value hierarchy (there were no impairments during the six months ended June 30, 2015):

$ in millions	Six months ended June 30, 2016
	Carrying		Fair Value						Gross
	Amount (b)		Level 1		Level 2		Level 3		Loss
Assets
Long-lived assets (a)
DP&L (Stuart)	$	456.4	$	—	$	—	$	164.4	$	292.0
DP&L (Killen)	$	330.5	$	—	$	—	$	84.3	$	246.2
DP&L (Zimmer)	$	429.9	$	—	$	—	$	111.0	$	318.9

(a)See Note 11 – Fixed-asset Impairment for further information

(b)Carrying amount at date of valuation

The following summarizes the significant unobservable inputs used in the Level 3 measurement on a non-recurring basis during the six months ended June 30, 2016:

$ in millions	Fair value		Valuation technique	Unobservable input	Range (weighted average)
Long-lived assets held and used:
DP&L (Stuart)	$	164.4	Discounted cash flow	Annual revenue growth	-9% to 10% (2%)
				Annual pre-tax operating margin	-29% to 52% (5%)
				Weighted-average cost of capital	9%
DP&L (Killen)	$	84.3	Discounted cash flow	Annual revenue growth	-11% to 13% (2%)
				Annual pre-tax operating margin	-50% to 67% (6%)
				Weighted-average cost of capital	11%
DP&L (Zimmer)	$	111.0	Discounted cash flow	Annual revenue growth	-14% to 13% (1%)
				Annual pre-tax operating margin	-46% to 80% (4%)
				Weighted-average cost of capital	9%

Note 4 – Derivative Instruments and Hedging Activities

In the normal course of business, DP&L enters into various financial arrangements, including derivative financial instruments. We use derivatives principally to manage the risk of changes in market prices for commodities. The derivatives that we use to economically hedge these risks are governed by our risk management policies for

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forward and futures contracts. Our net positions are continually assessed within our structured hedging programs to determine whether new or offsetting transactions are required. The objective of the hedging program is to mitigate financial risks while ensuring that we have adequate resources to meet our requirements. We monitor and value derivative positions monthly as part of our risk management processes. We use published sources for pricing, when possible, to mark positions to market. All of our derivative instruments are used for risk management purposes and are designated as normal purchase/normal sale, cash flow hedges or marked to market each reporting period.

At June 30, 2016, DP&L had the following outstanding derivative instruments:

Commodity	Accounting Treatment	Unit	Purchases(in thousands)	Sales(in thousands)		Net Purchases/ (Sales)(in thousands)
FTRs	Not designated	MWh	2.5	—		2.5
Natural gas futures	Not designated	Dths	1,442.5	—		1,442.5
Forward power contracts	Designated	MWh	692.6	(13,380.2	)	(12,687.6	)
Forward power contracts	Not designated	MWh	4,018.0	(3,574.8	)	443.2

At December 31, 2015, DP&L had the following outstanding derivative instruments:

Commodity	Accounting Treatment	Unit	Purchases(in thousands)	Sales(in thousands)		Net Purchases/ (Sales)(in thousands)
FTRs	Not designated	MWh	10.2	—		10.2
Forward power contracts	Designated	MWh	1,676.7	(7,795.8	)	(6,119.1	)
Forward power contracts	Not designated	MWh	5,049.9	(1,665.7	)	3,384.2

Cash Flow Hedges

As part of our risk management processes, we identify the relationships between hedging instruments and hedged items, as well as the risk management objective and strategy for undertaking various hedge transactions. The fair value of cash flow hedges is determined by observable market prices available as of the balance sheet dates and will continue to fluctuate with changes in market prices up to contract expiration. The effective portion of the hedging transaction is recognized in AOCI and transferred to earnings using specific identification of each contract when the forecasted hedged transaction takes place or when the forecasted hedged transaction is probable of not occurring. The ineffective portion of the cash flow hedge is recognized in earnings in the current period. All risk components were taken into account to determine the hedge effectiveness of the cash flow hedges.

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The following table provides information for DP&L concerning gains or losses recognized in AOCI for the cash flow hedges for the three and six months ended June 30, 2016 and 2015:

	Three months ended						Three months ended
	June 30, 2016						June 30, 2015
				Interest						Interest
$ in millions (net of tax)	Power			Rate Hedge			Power			Rate Hedge
Beginning accumulated derivative gains in AOCI	$	22.5		$	1.8		$	1.0		$	2.4
Net gains / (losses) associated with current period hedging transactions	(8.5		)	—			1.7			—
Net gains / (losses) reclassified to earnings
Interest expense	—			(0.2		)	—			(0.2		)
Revenues	(13.0		)	—			(1.9		)	—
Purchased power	2.4			—			0.3			—
Ending accumulated derivative gains in AOCI	$	3.4		$	1.6		$	1.1		$	2.2
	Six months ended						Six months ended
	June 30, 2016						June 30, 2015
				Interest						Interest
$ in millions (net of tax)	Power			Rate Hedge			Power			Rate Hedge
Beginning accumulated derivative gains in AOCI	$	9.2		$	2.0		$	0.2		$	2.6
Net gains associated with current period hedging transactions	13.0			—			1.8			—
Net gains / (losses) reclassified to earnings
Interest expense	—			(0.4		)	—			(0.4		)
Revenues	(24.0		)	—			(2.1		)	—
Purchased power	5.2			—			1.2			—
Ending accumulated derivative gains in AOCI	$	3.4		$	1.6		$	1.1		$	2.2
Portion expected to be reclassified to earnings in the next twelve months (a)	$	(3.1	)	$	0.7
Maximum length of time that we are hedging our exposure to variability in future cash flows related to forecasted transactions (in months)	18			0

(a) The actual amounts that we reclassify from AOCI to earnings related to power can differ from the estimate above due to market price changes.

Derivatives not designated as hedges

Certain derivative contracts are entered into on a regular basis as part of our risk management program but do not qualify for hedge accounting or the normal purchase and sales exceptions under FASC 815. Accordingly, such contracts are recorded at fair value with changes in the fair value charged or credited to the Condensed Statements of Operations in the period in which the change occurred. This is commonly referred to as “MTM accounting.” Contracts we enter into as part of our risk management program may be settled financially, by physical delivery, or net settled with the counterparty. FTRs, heating oil futures, natural gas, and certain forward power contracts are currently marked to market.

Certain qualifying derivative instruments have been designated as normal purchases or normal sales contracts, as provided under GAAP. Derivative contracts that have been designated as normal purchases or normal sales under GAAP are not subject to MTM accounting and are recognized in the Condensed Statements of Operations on an accrual basis.

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Regulatory Assets and Liabilities

The following tables present the amount and classification within the Condensed Statements of Operations or Condensed Balance Sheets of the gains and losses on DPL’s derivatives not designated as hedging instruments for the three and six months ended June 30, 2016 and 2015:

For the three months ended June 30, 2016
$ in millions	FTRs		Power			Natural Gas		Total
Change in unrealized gain	$	0.2	$	2.8		$	0.5	$	3.5
Realized gain / (loss)	0.2		(2.3		)	0.7		(1.4		)
Total	$	0.4	$	0.5		$	1.2	$	2.1
Recorded in Income Statement: gain / (loss)
Revenues	$	—	$	(5.1	)	$	—	$	(5.1	)
Purchased power	0.4		5.6			1.2		7.2
Total	$	0.4	$	0.5		$	1.2	$	2.1

For the three months ended June 30, 2015
$ in millions	Heating Oil			FTRs			Power			Total
Change in unrealized gain / (loss)	$	0.1		$	(0.8	)	$	1.1		$	0.4
Realized loss	(0.1		)	—			(1.5		)	(1.6		)
Total	$	—		$	(0.8	)	$	(0.4	)	$	(1.2	)
Recorded in Income Statement: gain / (loss)
Revenues	$	—		$	(0.8	)	$	(2.9	)	$	(3.7	)
Purchased power	—			—			2.5			2.5
Total	$	—		$	(0.8	)	$	(0.4	)	$	(1.2	)

For the six months ended June 30, 2016
$ in millions	FTRs		Power			Natural Gas		Total
Change in unrealized gain	$	0.4	$	0.9		$	0.3	$	1.6
Realized gain / (loss)	0.4		(2.7		)	0.5		(1.8		)
Total	$	0.8	$	(1.8	)	$	0.8	$	(0.2	)
Recorded in Income Statement: gain / (loss)
Revenues	$	—	$	(6.6	)	$	—	$	(6.6	)
Purchased power	0.8		4.8			0.8		6.4
Total	$	0.8	$	(1.8	)	$	0.8	$	(0.2	)

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For the six months ended June 30, 2015
$ in millions	Heating Oil			FTRs			Power			Natural Gas			Total
Change in unrealized gain / (loss)	$	0.2		$	0.1		$	(1.8	)	0.1			$	(1.4	)
Realized loss	(0.1		)	(0.1		)	(3.8		)	(0.1		)	(4.1		)
Total	$	0.1		$	—		$	(5.6	)	$	—		$	(5.5	)
Recorded in Balance Sheet:
Regulatory asset	$	0.1		$	—		$	—		$	—		$	0.1
Recorded in Income Statement: gain / (loss)
Revenues	—			—			2.2			—			2.2
Purchased power	—			—			(7.8		)	—			(7.8		)
Total	$	0.1		$	—		$	(5.6	)	$	—		$	(5.5	)

DP&L has elected not to offset derivative assets and liabilities and not to offset net derivative positions against the right to reclaim cash collateral pledged (an asset) or the obligation to return cash collateral received (a liability) under derivative agreements.

The following tables summarize the derivative positions presented in the balance sheet where a right of offset exists under these arrangements and related cash collateral received or pledged. The following table presents the fair value and balance sheet classification of DP&L’s derivative instruments at June 30, 2016:

Fair Values of Derivative Instruments
at June 30, 2016
				Gross Amounts Not Offset in the Condensed Balance Sheets
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Balance Sheets		Financial Instruments with Same Counterparty in Offsetting Position			Cash Collateral			Net Balance Fair Value
Assets
Short-term derivative positions (presented in Other prepayments and current assets)
Forward power contracts	Designated	$	13.9	$	(11.3	)	$	—		$	2.6
Forward power contracts	Not designated	13.9		(12.1		)	—			1.8
Natural gas futures	Not designated	0.3		—			—			0.3
FTRs	Not designated	0.1		—			—			0.1
Long-term derivative positions (presented in Other deferred assets)
Forward power contracts	Designated	9.1		(4.8		)	—			4.3
Forward power contracts	Not designated	2.5		(1.4		)	—			1.1
Total assets		$	39.8	$	(29.6	)	$	—		$	10.2
Liabilities
Short-term derivative positions (presented in Other current liabilities)
Forward power contracts	Designated	$	19.4	$	(11.3	)	$	(8.0	)	$	0.1
Forward power contracts	Not designated	19.6		(12.1		)	(3.1		)	4.4
Long-term derivative positions (presented in Other deferred credits)
Forward power contracts	Designated	4.9		(4.8		)	—			0.1
Forward power contracts	Not designated	1.4		(1.4		)	—			—
Total liabilities		$	45.3	$	(29.6	)	$	(11.1	)	$	4.6

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The following table presents the fair value and balance sheet classification of DP&L’s derivative instruments at December 31, 2015:

Fair Values of Derivative Instruments
at December 31, 2015
				Gross Amounts Not Offset in the Condensed Balance Sheets
$ in millions	Hedging Designation	Gross Fair Value as presented in the Condensed Balance Sheets		Financial Instruments with Same Counterparty in Offsetting Position			Cash Collateral			Net Balance Fair Value
Assets
Short-term derivative positions (presented in Other prepayments and current assets)
Forward power contracts	Designated	$	16.2	$	(7.1	)	$	—		$	9.1
Forward power contracts	Not designated	7.4		(5.5		)	—			1.9
FTRs	Not designated	0.2		(0.2		)	—			—
Long-term derivative positions (presented in Other deferred assets)
Forward power contracts	Designated	3.0		(2.4		)	—			0.6
Forward power contracts	Not designated	4.0		(2.7		)	—			1.3
Total assets		$	30.8	$	(17.9	)	$	—		$	12.9
Liabilities
Short-term derivative positions (presented in Other current liabilities)
Forward power contracts	Designated	$	7.1	$	(7.1	)	$	—		$	—
Forward power contracts	Not designated	14.5		(5.5		)	(8.0		)	1.0
FTRs	Not designated	0.5		(0.2		)	—			0.3
Long-term derivative positions (presented in Other deferred credits)
Forward power contracts	Designated	2.7		(2.4		)	—			0.3
Forward power contracts	Not designated	2.7		(2.7		)	—			—
Total liabilities		$	27.5	$	(17.9	)	$	(8.0	)	$	1.6

Credit risk-related contingent features

The aggregate fair value of DP&L’s commodity derivative instruments that were in a MTM loss position at June 30, 2016 was $45.3 million. $11.1 million of collateral was posted directly with third parties and in a broker margin account which offsets our loss positions on the forward contracts. This liability position is further offset by the asset position of counterparties with master netting agreements of $29.6 million. Since our debt is below investment grade, we could have to post collateral for the remaining $4.6 million.

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Note 5 – Debt

	Interest		June 30,			December 31,
$ in millions	Rate	Maturity	2016			2015
First mortgage bonds	1.875%	2016	$	445.0		$	445.0
Pollution control series	4.8%	2036	100.0			100.0
Pollution control series - rates from 1.29% - 1.31% and 1.13% - 1.17% (a)		2020	200.0			200.0
U.S. Government note	4.2%	2061	18.0			18.1
Unamortized deferred financing costs			(4.5		)	(6.2		)
Unamortized debt discount			(0.1		)	(0.2		)
Total long-term debt			758.4			756.7
Less: current portion			(444.6		)	(443.1		)
Total			$	313.8		$	313.6

(a)Range of interest rates for the six months ended June 30, 2016 and the twelve months ended December 31, 2015, respectively.

Debt covenants and restrictions

DP&L’s unsecured revolving credit agreement and Bond Purchase and Covenants Agreement have two financial covenants. The first measures Total Debt to Total Capitalization and is calculated, at the end of each fiscal quarter, by dividing total debt at the end of the quarter by total capitalization at the end of the quarter. The second financial covenant measures EBITDA to Interest Expense. The EBITDA to Interest Expense ratio is calculated, at the end of each fiscal quarter, by dividing EBITDA for the four prior fiscal quarters by the consolidated interest charges for the same period.

The cost of borrowing under DP&L's unsecured revolving credit agreement and Bond Purchase and Covenants Agreement adjust under certain credit rating scenarios.

Substantially all property, plant & equipment of DP&L is subject to the lien of the mortgage securing DP&L’s First and Refunding Mortgage.

Note 6 – Income Taxes

The following table details the effective tax rates for the three and six months ended June 30, 2016 and 2015.

	Three months ended		Six months ended
	June 30,		June 30,
	2016	2015	2016	2015
DP&L	36.4%	28.2%	36.9%	28.6%

Income tax expense for the three and six months ended June 30, 2016 and 2015 was calculated using the estimated annual effective income tax rates for 2016 and 2015 of 36.7% and 29.4%, respectively. For the three and six months ended June 30, 2016 and 2015 management estimated the annual effective tax rate based on its forecast of annual pre-tax income. To the extent that actual pre-tax results for the year differ from the forecasts applied to the most recent interim period, the rates estimated could be materially different from the actual effective tax rates.

For the six months ended June 30, 2016, DP&L’s current period effective tax rate was greater than the estimated annual effective rate primarily due to a change in its uncertain tax positions and the deduction for the preferred stock dividends. The increase in the annual effective rate compared to the same period in 2015 is primarily due to a forecasted pre-tax loss in the 2016 tax year.

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Note 7 – Benefit Plans

DP&L sponsors a defined benefit pension plan for the vast majority of its employees.

The net periodic benefit cost of the pension and postretirement benefit plans for the three and six months ended June 30, 2016 and 2015 was:

Net Periodic Benefit Cost	Pension
	Three months ended						Six months ended
	June 30,						June 30,
$ in millions	2016			2015			2016			2015
Service cost	$	1.4		$	1.7		$	2.8		$	3.5
Interest cost	3.7			4.3			7.4			8.6
Expected return on plan assets	(5.7		)	(5.5		)	(11.4		)	(11.2		)
Amortization of unrecognized:
Prior service cost	0.7			0.8			1.5			1.6
Actuarial loss	1.8			2.4			3.6			4.8
Net periodic benefit cost	$	1.9		$	3.7		$	3.9		$	7.3

Net Periodic Benefit Cost	Postretirement
	Three months ended						Six months ended
	June 30,						June 30,
$ in millions	2016			2015			2016			2015
Service cost	$	0.1		$	—		$	0.1		$	—
Interest cost	0.2			0.2			0.3			0.4
Expected return on plan assets	—			—			—			—
Amortization of unrecognized:
Prior service cost	—			—			—			—
Actuarial gain	(0.3		)	(0.1		)	(0.4		)	(0.3		)
Net periodic benefit cost	$	—		$	0.1		$	—		$	0.1

Benefit payments and Medicare Part D reimbursements, which reflect future service, are estimated to be paid as follows:

$ in millions	Pension		Postretirement
2016	$	12.3	$	0.8
2017	25.2		1.6
2018	25.8		1.5
2019	26.3		1.4
2020	26.7		1.4
2021 - 2025	134.8		5.7

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Note 8 – Shareholder’s Equity

DP&L has 250,000,000 authorized $0.01 par value common shares, of which 41,172,173 are outstanding at June 30, 2016. All common shares are held by DP&L’s parent, DPL.

As part of the PUCO’s approval of the Merger, DP&L agreed to maintain a capital structure that includes an equity ratio, calculated as total equity divided by total capitalization, of at least 50 percent and not to have a negative retained earnings balance. After the fixed-asset impairment recorded during the second quarter of 2016 and as of June 30, 2016, DP&L's equity ratio was 49% and retained earnings balance was negative. It is unknown what impact, if any, this will have on DP&L. In the generation separation order dated September 17, 2014, the PUCO permitted DP&L to temporarily maintain long-term debt of $750.0 million or 75% of its rate base, whichever is greater, until January 1, 2018.

Note 9 – Contractual Obligations, Commercial Commitments and Contingencies

Equity Ownership Interest

Commercial Commitments and Contractual Obligations

Contingencies

In the normal course of business, we are subject to various lawsuits, actions, proceedings, claims and other matters asserted under various laws and regulations. We believe the amounts provided in our Condensed Financial Statements, as prescribed by GAAP, are adequate in light of the probable and estimable contingencies. However, there can be no assurances that the actual amounts required to satisfy alleged liabilities from various legal proceedings, claims, tax examinations and other matters discussed below, and to comply with applicable laws and regulations, will not exceed the amounts reflected in our Condensed Financial Statements. As such, costs, if any, that may be incurred in excess of those amounts provided as of June 30, 2016, cannot be reasonably determined.

Environmental Matters

DP&L’s facilities and operations are subject to a wide range of federal, state and local environmental regulations and laws. The environmental issues that may affect us include:

• The federal CAA and state laws and regulations (including State Implementation Plans) which require compliance, obtaining permits and reporting as to air emissions;

• Rules and future rules issued by the USEPA, the Ohio EPA or other authorities that require reporting and reductions of GHGs;

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Note 10 – Related Party Transactions

Service Company

Benefit plans

The following table provides a summary of these transactions:

	Three months ended						Six months ended
	June 30,						June 30,
$ in millions	2016			2015			2016			2015
DP&L revenues:
Sales to DPLER (including MC Squared) (a)	$	—		$	68.3		$	—		$	179.0
DP&L Operation & Maintenance Expenses:
Premiums paid for insurance servicesprovided by MVIC (b)	$	(0.8	)	$	(0.8	)	$	(1.7	)	$	(1.6	)
Expense recoveries for servicesprovided to DPLER (c)	$	—		$	0.6		$	—		$	1.3
Transactions with the Service Company:
Charges for services provided	$	10.9		$	8.3		$	19.8		$	16.7
Charges to the Service Company	$	1.0		$	2.8		$	2.2		$	3.9
Transactions with other AES affiliates:
Charges / (credits) for health, welfare and benefit plans	$	(2.4	)	$	3.9		$	1.7		$	7.8
Balances with related parties:							At June 30, 2016			At December 31, 2015
Net payable to the Service Company							$	(1.1	)	$	(0.5	)
Short-term loan with DPL (d)							$	—		$	(35.0	)

(a) DP&L sold power to DPLER and MC Squared to satisfy the electric requirements of their retail customers. The revenue dollars associated with sales to DPLER and MC Squared are recorded as wholesale revenues in DP&L’s Financial Statements. These agreements were terminated upon the sale of DPLER on January 1, 2016.

(b) MVIC, a wholly-owned captive insurance subsidiary of DPL, provides insurance coverage to DP&L and other DPL subsidiaries for workers’ compensation, general liability, property damages and directors’ and officers’ liability. These amounts represent insurance premiums paid by DP&L to MVIC. DP&L received insurance proceeds from MVIC of $0.0 million and $2.3 million for the three months ended June 30, 2016 and 2015, respectively, and $0.2 million and $3.8 million for the six months ended June 30, 2016 and 2015, respectively.

(c) Prior to the sale of DPLER, in the normal course of business DP&L incurred and recorded expenses on behalf of DPLER. Such expenses included but were not limited to employee-related expenses, accounting, information technology, payroll, legal and other administration expenses. DP&L subsequently charged these expenses to DPLER at DP&L’s cost and credited the expense in which they were initially recorded.

(d) On December 31, 2015, DPL loaned $35.0 million to DP&L through an intercompany short-term loan at 2.67%.

Income taxes

AES files federal and state income tax returns which consolidate DPL and its subsidiaries, including DP&L. Under a tax sharing agreement with DPL, DP&L is responsible for the income taxes associated with its own taxable income and records the provision for income taxes using a separate return method. DP&L had a net payable

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balance under this agreement of $10.8 million as of June 30, 2016 and a net receivable balance of $1.5 million as of December 31, 2015, which are recorded in the Accrued taxes and Accounts receivable, net lines on the accompanying Condensed Balance Sheets on a gross basis.

Gain on termination of contract

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