Reported earnings for 2008 included $12.5 million or $0.12 per share from KCP&L Greater Missouri Operations Company (GMO), formerly Aquila, Inc., which Great Plains Energy acquired on July 14, 2008. Reported 2008 earnings also included $35.0 million or $0.35 per share compared with $38.3 million or $0.45 per share in 2007 from the discontinued operations of Strategic Energy. Great Plains Energy sold Strategic Energy in June 2008.

The average number of shares outstanding for the year increased to 101.2 million shares compared with 85.2 million shares in 2007, primarily as a result of the issuance of 32.2 million shares of Great Plains Energy common stock in connection with the GMO acquisition. This caused $0.28 per share of dilution in 2008.

Revised Earnings Guidance and Dividend Reduction

In November 2008, Great Plains Energy issued earnings guidance for 2009 of $1.30 to $1.60 per share. Since that time, the economic climate has deteriorated significantly, resulting in a reduced outlook for customer demand for electricity in the KCP&L and GMO service territories. In addition, the company now has improved visibility into the availability and cost of long-term debt financing as well as total debt requirements in 2009, the combined effect of which is expected to significantly increase financing costs.

The company has targeted operating expense reductions to help offset these factors; however, management no longer considers the prior guidance range representative of 2009 projected earnings performance. In consideration of these factors, Great Plains Energy is lowering its 2009 earnings guidance to a projected range of $1.10 to $1.40.

Reported Fourth Quarter Earnings for Great Plains Energy

For the three months ended December 31, 2008, reported earnings were $6.6 million or $0.06 per share compared with $47.7 million or $0.56 per share for the 2007 period. The discontinued operations at Strategic Energy had earnings of $21.9 million or $0.26 per share in the fourth quarter of 2007. The average number of shares outstanding increased from 85.8 million in the fourth quarter of 2007 to 118.6 million in 2008, which caused $0.02 per share of dilution.

Core Earnings for Great Plains Energy

Great Plains Energy’s core earnings for the full-year 2008 were $138.5 million or $1.37 per share, compared with $125.9 million or $1.48 per share in 2007. The increase in 2008 earnings resulted primarily from the addition of the GMO earnings, as well as from new retail rates, increased Allowance for Funds Used During Construction (AFUDC), and a litigation settlement in the first quarter at Kansas City Power & Light (KCP&L). These were partially offset by unfavorable summer weather, a decrease in wholesale sales, higher operation and maintenance costs, and increased fuel and purchased power expense at KCP&L. Shares issued related to the GMO acquisition caused $0.26 of core earnings per share dilution for the year 2008.

Core earnings for the fourth quarter 2008 were $9.3 million or $0.08 per share, compared with $27.5 million or $0.32 per share for the 2007 period. In addition to a loss of $4.9 million or $0.04 for the quarter for GMO, core earnings declined at KCP&L by $18.3 million or $0.26 per share compared to 2007. The drop at KCP&L was driven by lower wholesale sales volumes and prices, higher depreciation and amortization, and increased operational expenses. This decline was partially mitigated by new retail rates and increased AFUDC contributions. In addition, the quarter was impacted by $0.03 of core earnings per share dilution.

The company believes core earnings provide a more meaningful measure of performance that is comparable among periods because it excludes the effects of the discontinued operations of Strategic Energy, certain unusual items and mark-to-market gains and losses on certain contracts. Reported earnings are reconciled to core earnings in attachments B and C.

Electric Utility Segment (Includes KCP&L and GMO)

Full-Year 2008

Reported earnings for the Electric Utility segment were $143.1 million or $1.41 per share. Core earnings were $162.8 million or $1.61 per share. The additional shares issued for the GMO acquisition caused reported dilution of $0.27 per share and core dilution of $0.30 per share.

Core earnings for KCP&L declined 1% year-on-year. Primary positive drivers included the following:

Retail revenue, which increased $61.8 million, or 6%, primarily as a result of new retail rates which more than offset unfavorable weather in the third quarter; and

The equity component of AFUDC grew $20.0 million over 2007 as the Company’s continued progress on the Iatan 1 and Iatan 2 construction projects led to a 117% increase in Construction Work In Progress during 2008.

These increases were more than offset by a number of items, including the following:

Depreciation and amortization expense, which increased 16% or $28.7 million compared to 2007;

Purchased power expense, which rose 18% or $18.0 million from 2007 due to two factors:

A 26% increase in the average price per MWh purchased due to higher natural gas prices; and

An 8% increase in MWh purchases primarily as a result of plant outages in the first half of the year and the Iatan 1 scheduled outage in the fourth quarter for a unit overhaul and environmental upgrades;

Interest expense, net of $9.1 million of the debt component of AFUDC, was $5.1 million higher than 2007 due to higher debt levels;

Operations and maintenance costs increased $22.5 million or 6% over 2007 primarily attributable to increased plant outage maintenance;

Wholesale sales revenue, which was $12.5 million lower than 2007 as a result of plant outages, somewhat offset by higher prices for the full-year; and

Fuel expense, which exceeded 2007 levels by $7.8 million or 3% as a result of the impact of higher coal and coal transportation costs.

“We realize that announcing lower guidance and a dividend reduction is disappointing to our stockholders; however, the Board’s decision to reduce the dividend is prudent in order to strengthen our earnings, cash flow and credit position so that we can be in a position to better weather the current and anticipated economic and financial market conditions,” said Mike Chesser, chairman and chief executive officer. “Reducing the dividend by half will preserve $100 million of capital per year – capital that can be reinvested to grow our regulated utility platform – and result in yield and payout ratios that are in line with other utilities. We strongly believe this decision will allow the company to deliver better long-term shareholder returns and is in the best interest of our stockholders.”

“In 2008, we also took proactive steps to reduce our business risk and refocus our efforts on our utility roots. The completion of our acquisition of GMO, the sale of Strategic Energy, and the significant progress we made on our Comprehensive Energy Plan position us with a solid utility platform to provide long-term benefit and value to customers and stockholders as the economy and the financial markets improve,” continued Chesser.