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Exelon Reports First Quarter 2021 Results

Source: 
Business Wire

Earnings Release Highlights

  • GAAP Net Loss of $(0.30) per share and Adjusted (non-GAAP) Operating Loss of $(0.06) per share for the first quarter of 2021
  • Affirming range for full year 2021 adjusted (non-GAAP) operating earnings guidance of $2.60-$3.00 per share
  • Strong utility reliability performance - all gas utilities achieved top decile in gas odor response and every utility achieved top quartile in outage frequency and outage duration
  • Generation’s nuclear fleet capacity factor was 95.3% (owned and operated units)
  • PECO filed an electric distribution rate case with the PAPUC in March and ComEd filed its annual distribution formula rate update with the ICC in April. Both cases are seeking an increase in electric distribution base rates to support investments that will enhance the reliability of the grid and enable the advancement of clean technologies and renewable energy.

CHICAGO--(BUSINESS WIRE)-- Exelon Corporation (Nasdaq: EXC) today reported its financial results for the first quarter of 2021.

“Our utility businesses performed at a high level both financially and operationally during the first quarter, and we continue to invest in customer service and grid modernization across our six utilities,” said Christopher M. Crane, president and CEO of Exelon. “The generation business overall was strong, and we are implementing cost savings to offset losses from the unprecedented Texas storms. Looking ahead, we remain on track with the planned separation of our generation and utility businesses and are encouraged by growing momentum for federal and state clean energy policies that, if approved, will leave both standalone companies uniquely positioned to aid our nation’s transition to a carbon-free future.”

“Utility adjusted (non-GAAP) operating earnings was 11 cents per share higher than a year ago and ahead of plan, and excluding the storm impact, Exelon Generation would have earned adjusted (non-GAAP) operating earnings of 32 cents per share, which was in keeping with expectations,” said Joseph Nigro, senior executive vice president and CFO of Exelon. “The Texas storms and subsequent generation outages resulted in a 90 cents per share impact to operating earnings, though we expect to narrow some of that loss over the course of the year. The strong utility results and continued cost-savings measures at Generation reduced our adjusted (non-GAAP) operating loss for the quarter to $0.06 cents per share and we are affirming our full-year adjusted (non-GAAP) operating earnings guidance of $2.60 to $3.00 per share.”

First Quarter 2021

Exelon's GAAP Net Loss for the first quarter of 2021 decreased to $(0.30) per share from $0.60 GAAP Net Income per share in the first quarter of 2020. Adjusted (non-GAAP) Operating Loss for the first quarter of 2021 decreased to $(0.06) per share from $0.87 Adjusted (non-GAAP) Operating Earnings per share in the first quarter of 2020. For the reconciliations of GAAP Net Loss to Adjusted (non-GAAP) Operating Loss, refer to the tables beginning on page 6.

Adjusted (non-GAAP) Operating Loss in the first quarter of 2021 primarily reflect:

  • Lower Generation earnings primarily due to the impacts of the February 2021 extreme cold weather event; partially offset by
  • Higher utility earnings primarily due to higher electric distribution earnings at ComEd from higher rate base and higher allowed ROE due to an increase in treasury rates; the favorable impacts of the multi-year plan at BGE; regulatory rate increases at PHI; and favorable weather conditions at PECO and PHI.

Operating Company Results1

ComEd

ComEd's first quarter of 2021 GAAP Net Income increased to $197 million from $168 million in the first quarter of 2020. ComEd's Adjusted (non-GAAP) Operating Earnings for the first quarter of 2021 increased to $198 million from $168 million in the first quarter of 2020, primarily due to higher electric distribution earnings from higher rate base and higher allowed ROE due to an increase in treasury rates. Due to revenue decoupling, ComEd's distribution earnings are not affected by actual weather or customer usage patterns.

PECO

PECO’s first quarter of 2021 GAAP Net Income increased to $167 million from $140 million in the first quarter of 2020. PECO's Adjusted (non-GAAP) Operating Earnings for the first quarter of 2021 increased to $170 million from $140 million in the first quarter of 2020, primarily due to favorable weather conditions and favorable volume.

BGE

BGE’s first quarter of 2021 GAAP Net Income increased to $209 million from $181 million in the first quarter of 2020. BGE's Adjusted (non-GAAP) Operating Earnings increased to $211 million from $182 million in the first quarter of 2020, primarily due to the favorable impacts of the multi-year plan. Due to revenue decoupling, BGE's distribution earnings are not affected by actual weather or customer usage patterns.

PHI

PHI’s first quarter of 2021 GAAP Net Income increased to $128 million from $108 million in the first quarter of 2020. PHI’s Adjusted (non-GAAP) Operating Earnings for the first quarter of 2021 increased to $130 million from $110 million in the first quarter of 2020, primarily due to regulatory rate increases and favorable weather conditions in Delaware and New Jersey. Due to revenue decoupling, PHI's distribution earnings related to Pepco Maryland, DPL Maryland and Pepco District of Columbia are not affected by actual weather or customer usage patterns.

Generation

Generation had a GAAP Net Loss of $(793) million in the first quarter of 2021 compared with GAAP Net Income of $45 million in the first quarter of 2020. Generation had an Adjusted (non-GAAP) Operating Loss of $(571) million in the first quarter of 2021 compared with Adjusted (non-GAAP) Operating Earnings of $312 million in the first quarter of 2020, primarily due to the impacts of the February 2021 extreme cold weather event.

As of March 31, 2021, the percentage of expected generation hedged is 94%-97% for 2021.

___________

1Exelon’s five business units include ComEd, which consists of electricity transmission and distribution operations in northern Illinois; PECO, which consists of electricity transmission and distribution operations and retail natural gas distribution operations in southeastern Pennsylvania; BGE, which consists of electricity transmission and distribution operations and retail natural gas distribution operations in central Maryland; PHI, which consists of electricity transmission and distribution operations in the District of Columbia and portions of Maryland, Delaware, and New Jersey and retail natural gas distribution operations in northern Delaware; and Generation, which consists of owned and contracted electric generating facilities and wholesale and retail customer supply of electric and natural gas products and services, including renewable energy products and risk management services.

Recent Developments and First Quarter Highlights

  • Planned Separation: On Feb. 25, 2021, Exelon and Generation filed applications with the Federal Energy Regulatory Commission (FERC), New York State Department of Public Service (NYPSC), and Nuclear Regulatory Commission (NRC) seeking approvals for the separation of Generation. On March 25, 2021, Exelon filed a request for a private letter ruling with the Internal Revenue Service (IRS) to confirm the tax-free treatment of the planned separation. Exelon and Generation expect a decision from the FERC and the IRS in the third quarter of 2021, the NRC in the fourth quarter of 2021, and have requested a decision from the NYPSC before the end of 2021 but cannot predict if the applications will be approved as filed. Exelon is targeting the completion of the separation in the first quarter of 2022.
  • Impacts of the February 2021 Extreme Cold Weather Event and Texas-based Generating Assets Outages: Beginning on Feb. 15, 2021, Generation’s Texas-based generating assets within the Electric Reliability Council of Texas (ERCOT) market, specifically Colorado Bend II, Wolf Hollow II, and Handley, experienced outages as a result of extreme cold weather conditions. In addition, those weather conditions drove increased demand for service, dramatically increased wholesale power prices, and also increased gas prices in certain regions. In response to the high demand and significantly reduced total generation on the system, the Public Utility Commission of Texas (PUCT) directed ERCOT to use an administrative price cap of $9,000 per megawatt hour during firm load shedding events.



    The estimated impact to Exelon’s and Generation’s Net income for the first quarter of 2021 arising from these market and weather conditions was a reduction of approximately $880 million. The first quarter estimated impact includes certain charges associated with the natural gas business that may be reduced through waivers and/or recoveries from customers. Therefore, such charges are not included in the estimated full year earnings impact. Exelon and Generation estimate a reduction in Net income of approximately $670 million to $820 million for the full year 2021. The ultimate impact to Exelon’s and Generation’s consolidated financial statements may be affected by a number of factors, including final settlement data, the impacts of customer and counterparty credit losses, any state or federal solutions to address the financial challenges caused by the event, and related litigation and contract disputes. Various parties, including Generation, have filed requests with the PUCT to void the PUCT’s orders setting prices at $9,000 per megawatt hour during firm load shedding events and to enforce its order and reduce prices for 32 hours between February 18 and February 19 after firm load shedding ceased. Appeals of certain of the PUCT’s orders also have been filed in state court. Exelon and Generation cannot predict the outcome of these proceedings or the financial statement impact.



    Exelon expects to offset between $410 million and $490 million of this impact for the full year 2021 primarily at Generation through a combination of enhanced revenue opportunities, deferral of selected non-essential maintenance, and primarily one-time cost savings.
  • ComEd Distribution Formula Rate: On April 16, 2021, ComEd filed its annual distribution formula rate update with the Illinois Commerce Commission (ICC). The ICC approval is due by December 2021 and the rates will take effect in January 2022. The filing request includes an increase of $40 million for the initial year revenue requirement for 2022 and an increase of $11 million related to the annual reconciliation for 2020. The revenue requirement for 2022 provides for a weighted average debt and equity return on distribution rate base of 5.72%, inclusive of an allowed ROE of 7.36%, reflecting the average monthly yields for 30-year treasury bonds plus 580 basis points. The reconciliation revenue requirement for 2020 provides for a weighted average debt and equity return on distribution rate base of 5.69%, inclusive of an allowed ROE of 7.29%, reflecting the average monthly yields for 30-year treasury bonds plus 580 basis points less a performance metrics penalty of 7 basis points.
  • PECO Pennsylvania Electric Distribution Rate Case: On March 30, 2021, PECO filed an application with the Pennsylvania Public Utility Commission (PAPUC) to increase its annual electric distribution rates by $246 million, reflecting an ROE of 10.95%. PECO currently expects a decision in the fourth quarter of 2021 but cannot predict if the PAPUC will approve the application as filed.
  • Nuclear Operations: Generation’s nuclear fleet, including its owned output from the Salem Generating Station and 100% of the CENG units, produced 43,466 gigawatt-hours (GWhs) in the first quarter of 2021, compared with 42,555 GWhs in the first quarter of 2020. Excluding Salem, the Exelon-operated nuclear plants at ownership achieved a 95.3% capacity factor for the first quarter of 2021, compared with 93.9% for the first quarter of 2020. The number of planned refueling outage days in the first quarter of 2021 totaled 84, compared with 94 in the first quarter of 2020. There were 3 non-refueling outage days in the first quarter of 2021 and 11 in the first quarter of 2020.
  • Fossil and Renewables Operations: The Dispatch Match rate for Generation’s gas and hydro fleet was 68.5% in the first quarter of 2021, compared with 98.2% in the first quarter of 2020. The lower performance in the quarter was attributed to unplanned outages at Texas-based generating assets during the February 2021 extreme cold-weather event.

Energy Capture for the wind and solar fleet was 96.4% in the first quarter of 2021, compared with 94.7% in the first quarter of 2020.

  • Financing Activities:
    • On March 9, 2021, ComEd issued $700 million of its First Mortgage 3.13% Bonds, Series 130, due March 15, 2051. ComEd used the proceeds to repay existing indebtedness and for general corporate purposes.
    • On March 8, 2021, PECO issued $375 million of its First and Refunding Mortgage Bonds, 3.05% Series due March 15, 2051. PECO used the proceeds for general corporate purposes.
    • On March 30, 2021, Pepco issued $150 million of its First Mortgage Bonds, 2.32% Series due March 30, 2031. Pepco used the proceeds to repay existing indebtedness and for general corporate purposes.
    • On March 30, 2021, DPL issued $125 million of its First Mortgage Bonds, 3.24% Series due March 30, 2051. DPL used the proceeds to repay existing indebtedness and for general corporate purposes.
    • On March 10, 2021, ACE issued $350 million of its First Mortgage Bonds, 2.30% Series due March 15, 2031. ACE used the proceeds to repay existing indebtedness and for general corporate purposes.

GAAP/Adjusted (non-GAAP) Operating Earnings Reconciliation

Adjusted (non-GAAP) Operating Earnings (Loss) for the first quarter of 2021 do not include the following items (after tax) that were included in reported GAAP Net Income (Loss):

(in millions)

 

Exelon

Earnings per

Diluted

Share

 

Exelon

 

ComEd

 

PECO

 

BGE

 

PHI

 

Generation

2021 GAAP Net Income (Loss)

 

$

(0.30

)

 

$

(289

)

 

$

197

 

$

167

 

$

209

 

$

128

 

$

(793

)

Mark-to-Market Impact of Economic Hedging Activities (net of taxes of $46 and $45, respectively)

 

(0.14

)

 

(135

)

 

 

 

 

 

(134

)

Unrealized Losses Related to Nuclear Decommissioning Trust (NDT) Fund Investments (net of taxes of $40)

 

0.04

 

 

43

 

 

 

 

 

 

43

 

Plant Retirements and Divestitures (net of taxes of $103)

 

0.32

 

 

310

 

 

 

 

 

 

310

 

Cost Management Program (net of taxes of $0)

 

 

 

1

 

 

 

 

 

 

1

 

Change in Environmental Liabilities (net of taxes of $1)

 

 

 

2

 

 

 

 

 

 

2

 

COVID-19 Direct Costs (net of taxes of $4, $1, $0, and $3, respectively)

 

0.01

 

 

10

 

 

 

1

 

1

 

 

8

 

Acquisition Related Costs (net of taxes of $2)

 

0.01

 

 

6

 

 

 

 

 

 

6

 

ERP System Implementation Costs (net of taxes of $1, $0, $0, $0, and $1, respectively)

 

0.01

 

 

5

 

 

 

1

 

1

 

1

 

2

 

Planned Separation Costs (net of taxes of $2, $0, $0, $0, and $1, respectively)

 

0.01

 

 

7

 

 

1

 

1

 

 

1

 

2

 

Income Tax-Related Adjustments (entire amount represents tax expense)

 

 

 

(2

)

 

 

 

 

 

 

Noncontrolling Interests (net of taxes of $6)

 

(0.02

)

 

(17

)

 

 

 

 

 

(17

)

2021 Adjusted (non-GAAP) Operating Earnings (Loss)

 

$

(0.06

)

 

$

(60

)

 

$

198

 

$

170

 

$

211

 

$

130

 

$

(571

)

Adjusted (non-GAAP) Operating Earnings for the first quarter of 2020 do not include the following items (after tax) that were included in reported GAAP Net Income:

(in millions)

 

Exelon

Earnings per

Diluted

Share

 

Exelon

 

ComEd

 

PECO

 

BGE

 

PHI

 

Generation

2020 GAAP Net Income

 

$

0.60

 

 

$

582

 

 

$

168

 

$

140

 

$

181

 

$

108

 

$

45

 

Mark-to-Market Impact of Economic Hedging Activities (net of taxes of $32 and $33, respectively)

 

(0.10

)

 

(94

)

 

 

 

 

 

(97

)

Unrealized Losses Related to NDT Fund Investments (net of taxes of $405)

 

0.50

 

 

485

 

 

 

 

 

 

485

 

Asset Impairments (net of taxes of $1)

 

 

 

2

 

 

 

 

 

 

2

 

Plant Retirements and Divestitures (net of taxes of $4)

 

0.01

 

 

13

 

 

 

 

 

 

13

 

Cost Management Program (net of taxes of $3, $0, $1, and $3, respectively)

 

0.01

 

 

9

 

 

 

 

1

 

2

 

8

 

Income Tax-Related Adjustments (entire amount represents tax expense)

 

 

 

(2

)

 

 

 

 

 

 

Noncontrolling Interests (net of taxes of $30)

 

(0.15

)

 

(144

)

 

 

 

 

 

(144

)

2020 Adjusted (non-GAAP) Operating Earnings

 

$

0.87

 

 

$

851

 

 

$

168

 

$

140

 

$

182

 

$

110

 

$

312

 

Note:

Amounts may not sum due to rounding.

Unless otherwise noted, the income tax impact of each reconciling item between GAAP Net Income (Loss) and Adjusted (non-GAAP) Operating Earnings (Loss) is based on the marginal statutory federal and state income tax rates for each Registrant, taking into account whether the income or expense item is taxable or deductible, respectively, in whole or in part. For all items except the unrealized losses related to NDT fund investments, the marginal statutory income tax rates for 2021 and 2020 ranged from 25.0% to 29.0%. Under IRS regulations, NDT fund investment returns are taxed at different rates for investments if they are in qualified or non-qualified funds. The effective tax rates for the unrealized losses related to NDT fund investments were 48.0% and 45.5% for the three months ended March 31, 2021 and 2020, respectively.

Webcast Information

Exelon will discuss first quarter 2021 earnings in a conference call scheduled for today at 9 a.m. Central Time (10 a.m. Eastern Time). The webcast and associated materials can be accessed at www.exeloncorp.com/investor-relations.

About Exelon

Exelon Corporation (Nasdaq: EXC) is a Fortune 100 energy company with the largest number of electricity and natural gas customers in the U.S. Exelon does business in 48 states, the District of Columbia, and Canada and had 2020 revenue of $33 billion. Exelon serves approximately 10 million customers in Delaware, the District of Columbia, Illinois, Maryland, New Jersey, and Pennsylvania through its Atlantic City Electric, BGE, ComEd, Delmarva Power, PECO, and Pepco subsidiaries. Exelon is one of the largest competitive U.S. power generators, with more than 31,000 megawatts of nuclear, gas, wind, solar and hydroelectric generating capacity comprising one of the nation’s cleanest and lowest-cost power generation fleets. The company’s Constellation business unit provides energy products and services to approximately 2 million residential, public sector, and business customers, including three fourths of the Fortune 100. Follow Exelon on Twitter @Exelon.

Non-GAAP Financial Measures

In addition to net income as determined under generally accepted accounting principles in the United States (GAAP), Exelon evaluates its operating performance using the measure of Adjusted (non-GAAP) Operating Earnings because management believes it represents earnings directly related to the ongoing operations of the business. Adjusted (non-GAAP) Operating Earnings exclude certain costs, expenses, gains and losses, and other specified items. This measure is intended to enhance an investor’s overall understanding of period over period operating results and provide an indication of Exelon’s baseline operating performance excluding items that are considered by management to be not directly related to the ongoing operations of the business. In addition, this measure is among the primary indicators management uses as a basis for evaluating performance, allocating resources, setting incentive compensation targets, and planning and forecasting of future periods. Adjusted (non-GAAP) Operating Earnings is not a presentation defined under GAAP and may not be comparable to other companies’ presentation. The Company has provided the non-GAAP financial measure as supplemental information and in addition to the financial measures that are calculated and presented in accordance with GAAP. Adjusted (non-GAAP) Operating Earnings should not be deemed more useful than, a substitute for, or an alternative to the most comparable GAAP Net Income measures provided in this earnings release and attachments. This press release and earnings release attachments provide reconciliations of Adjusted (non-GAAP) Operating Earnings to the most directly comparable financial measures calculated and presented in accordance with GAAP, are posted on Exelon’s website: www.exeloncorp.com, and have been furnished to the Securities and Exchange Commission on Form 8-K on May 5, 2021.

Cautionary Statements Regarding Forward-Looking Information

This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties including, among others, those related to the timing, manner, tax-free nature, and expected benefits associated with the potential separation of Exelon’s competitive power generation and customer-facing energy business from its six regulated electric and gas utilities. Words such as “could,” “may,” “expects,” “anticipates,” “will,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “predicts,” and variations on such words, and similar expressions that reflect our current views with respect to future events and operational, economic, and financial performance, are intended to identify such forward-looking statements.

The factors that could cause actual results to differ materially from the forward-looking statements made by Exelon Corporation, Exelon Generation Company, LLC, Commonwealth Edison Company, PECO Energy Company, Baltimore Gas and Electric Company, Pepco Holdings LLC, Potomac Electric Power Company, Delmarva Power & Light Company, and Atlantic City Electric Company (Registrants) include those factors discussed herein, as well as the items discussed in (1) the Registrants' 2020 Annual Report on Form 10-K in (a) Part I, ITEM 1A. Risk Factors, (b) Part II, ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations, and (c) Part II, ITEM 8. Financial Statements and Supplementary Data: Note 19, Commitments and Contingencies; (2) the Registrants' First Quarter 2021 Quarterly Report on Form 10-Q (to be filed on May 5, 2021) in (a) Part II, ITEM 1A. Risk Factors, (b) Part I, ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations, and (c) Part I, ITEM 1. Financial Statements: Note 14, Commitments and Contingencies; and (3) other factors discussed in filings with the SEC by the Registrants.

Investors are cautioned not to place undue reliance on these forward-looking statements, whether written or oral, which apply only as of the date of this press release. None of the Registrants undertakes any obligation to publicly release any revision to its forward-looking statements to reflect events or circumstances after the date of this press release.

Exelon

GAAP Consolidated Statements of Operations and

Adjusted (non-GAAP) Operating Earnings Reconciling Adjustments

(unaudited)

(in millions, except per share data)

 

 

Three Months Ended

March 31, 2021

 

Three Months Ended

March 31, 2020

 

GAAP (a)

 

Non-GAAP

Adjustments

 

 

 

GAAP (a)

 

Non-GAAP

Adjustments

 

 

Operating revenues

$

9,890

 

 

$

83

 

 

(b)

 

$

8,747

 

 

$

(179

)

 

(b)

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

Purchased power and fuel

5,968

 

 

204

 

 

(b),(c)

 

3,867

 

 

(48

)

 

(b)

Operating and maintenance

1,979

 

 

173

 

 

(c),(d),(e),(f),

(g),(h),(i)

 

2,204

 

 

(21

)

 

(c),(d),(l)

Depreciation and amortization

1,697

 

 

(642

)

 

(c)

 

1,021

 

 

(10

)

 

(c)

Taxes other than income taxes

438

 

 

 

 

 

 

437

 

 

 

 

 

Total operating expenses

10,082

 

 

 

 

 

 

7,529

 

 

 

 

 

Gain on sales of assets and businesses

71

 

 

(68

)

 

(c)

 

2

 

 

 

 

 

Operating (loss) income

(121

)

 

 

 

 

 

1,220

 

 

 

 

 

Other income and (deductions)

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

(386

)

 

(3

)

 

(b)

 

(410

)

 

16

 

 

(b)

Other, net

225

 

 

80

 

 

(b),(j)

 

(725

)

 

879

 

 

(b),(j)

Total other income and (deductions)

(161

)

 

 

 

 

 

(1,135

)

 

 

 

 

(Loss) income before income taxes

(282

)

 

 

 

 

 

85

 

 

 

 

 

Income taxes

(19

)

 

109

 

 

(b),(c),(e),(f),

(g),(h),(i),(j)

 

(294

)

 

382

 

 

(b),(c),(d),(j),

(l)

Equity in losses of unconsolidated affiliates

(1

)

 

 

 

 

 

(3

)

 

 

 

 

Net (loss) income

(264

)

 

 

 

 

 

376

 

 

 

 

 

Net income (loss) attributable to noncontrolling interests

25

 

 

18

 

 

(k)

 

(206

)

 

144

 

 

(k)

Net income (loss) attributable to common shareholders

$

(289

)

 

 

 

 

 

$

582

 

 

 

 

 

Effective tax rate(m)

6.7

%

 

 

 

 

 

(345.9

)%

 

 

 

 

Earnings per average common share

 

 

 

 

 

 

 

 

 

 

 

Basic

$

(0.30

)

 

 

 

 

 

$

0.60

 

 

 

 

 

Diluted

$

(0.30

)

 

 

 

 

 

$

0.60

 

 

 

 

 

Average common shares outstanding

 

 

 

 

 

 

 

 

 

 

 

Basic

977

 

 

 

 

 

 

975

 

 

 

 

 

Diluted

977

 

 

 

 

 

 

976

 

 

 

 

 

__________

(a)

 

Results reported in accordance with accounting principles generally accepted in the United States (GAAP).

(b) 

Adjustment to exclude the mark-to-market impact of Exelon’s economic hedging activities, net of intercompany eliminations.

(c) 

In 2021, adjustment to exclude accelerated depreciation and amortization associated with Generation's decision in the third quarter of 2020 to early retire Byron and Dresden nuclear facilities in 2021 and Mystic Units 8 and 9 in 2024, partially offset by a gain on sale of Generation's solar business. In 2020, adjustment to exclude accelerated depreciation and amortization expenses associated with the early retirement of certain fossil sites.

(d) 

Adjustment to exclude reorganization related to cost management programs.

(e) 

Adjustment to exclude costs related to the acquisition of Electricite de France SA's (EDF's) interest in CENG.

(f) 

Adjustment to exclude changes in environmental liabilities.

(g) 

Adjustment to exclude direct costs related to COVID-19 consisting primarily of costs to acquire personal protective equipment, costs for cleaning supplies and services, and costs to hire healthcare professionals to monitor the health of employees.

(h) 

Adjustment to exclude costs related to the planned separation primarily comprised of third-party costs paid to advisors, consultants, lawyers, and other experts assisting in the planned separation as well as employee-related severance costs.

(i) 

Adjustment to exclude costs related to a multi-year Enterprise Resource Program (ERP) system implementation.

(j) 

Adjustment to exclude the impact of net unrealized losses on Generation’s NDT fund investments for Non-Regulatory and Regulatory Agreement Units. The impacts of the Regulatory Agreement Units, including the associated income taxes, are contractually eliminated, resulting in no earnings impact.

(k) 

Adjustment to exclude elimination from Generation’s results of the noncontrolling interests related to certain exclusion items, primarily related to unrealized gains and losses on NDT fund investments for CENG units.

(l) 

Adjustment to exclude certain asset impairments.

(m) 

The effective tax rate related to Adjusted (non-GAAP) Operating Earnings is 120.0% and 10.0% for the three months ended March 31, 2021 and 2020, respectively.

ComEd

GAAP Consolidated Statements of Operations and

Adjusted (non-GAAP) Operating Earnings Reconciling Adjustments

(unaudited)

(in millions)

 

 

Three Months Ended

March 31, 2021

 

Three Months Ended

March 31, 2020

 

GAAP (a)

 

Non-GAAP

Adjustments

 

 

 

GAAP (a)

 

Non-GAAP

Adjustments

 

 

Operating revenues

$

1,535

 

 

$

 

 

 

 

$

1,439

 

 

$

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

 

Purchased power and fuel

527

 

 

 

 

 

 

486

 

 

 

 

 

Operating and maintenance

316

 

 

(1)

 

 

(b)

 

317

 

 

 

 

 

Depreciation and amortization

292

 

 

 

 

 

 

273

 

 

 

 

 

Taxes other than income taxes

75

 

 

 

 

 

 

75

 

 

 

 

 

Total operating expenses

1,210

 

 

 

 

 

 

 

1,151

 

 

 

 

 

Operating income

325

 

 

 

 

 

 

 

288

 

 

 

 

 

Other income and (deductions)

 

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

(96

)

 

 

 

 

 

(94

)

 

 

 

 

Other, net

7

 

 

 

 

 

 

10

 

 

 

 

 

Total other income and (deductions)

(89

)

 

 

 

 

 

 

(84

)

 

 

 

 

Income before income taxes

236

 

 

 

 

 

 

 

204

 

 

 

 

 

Income taxes

39

 

 

 

 

 

 

36

 

 

 

 

 

Net income

$

197

 

 

 

 

 

 

 

$

168

 

 

 

 

 

                     
__________
(a) 

Results reported in accordance with accounting principles generally accepted in the United States (GAAP).

(b) 

Adjustment to exclude costs related to the planned separation primarily comprised of third-party costs paid to advisors, consultants, lawyers, and other experts assisting in the planned separation as well as employee-related severance costs.

PECO

GAAP Consolidated Statements of Operations and

Adjusted (non-GAAP) Operating Earnings Reconciling Adjustments

(unaudited)

(in millions)

 

 

Three Months Ended

March 31, 2021

 

Three Months Ended

March 31, 2020

 

GAAP (a)

 

Non-GAAP

Adjustments

 

 

 

GAAP (a)

 

Non-GAAP

Adjustments

 

 

Operating revenues

$

889

 

 

$

 

 

 

 

$

813

 

 

$

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

Purchased power and fuel

316

 

 

 

 

 

 

283

 

 

 

 

 

Operating and maintenance

234

 

 

(4)

 

 

(b)

 

217

 

 

 

 

 

Depreciation and amortization

86

 

 

 

 

 

 

86

 

 

 

 

 

Taxes other than income taxes

43

 

 

 

 

 

 

39

 

 

 

 

 

Total operating expenses

679

 

 

 

 

 

 

625

 

 

 

 

 

Operating income

210

 

 

 

 

 

 

188

 

 

 

 

 

Other income and (deductions)

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

(38

)

 

 

 

 

 

(36

)

 

 

 

 

Other, net

5

 

 

 

 

 

 

3

 

 

 

 

 

Total other income and (deductions)

(33

)

 

 

 

 

 

(33

)

 

 

 

 

Income before income taxes

177

 

 

 

 

 

 

155

 

 

 

 

 

Income taxes

10

 

 

1

 

 

(b)

 

15

 

 

 

 

 

Net income

$

167

 

 

 

 

 

 

$

140

 

 

 

 

 

__________
(a) 

Results reported in accordance with accounting principles generally accepted in the United States (GAAP).

(b) 

Adjustment to exclude reorganization costs related to cost management programs and direct costs related to COVID-19 consisting primarily of costs to acquire personal protective equipment, costs for cleaning supplies and services, and costs to hire healthcare professionals to monitor the health of employees.

BGE

GAAP Consolidated Statements of Operations and

Adjusted (non-GAAP) Operating Earnings Reconciling Adjustments

(unaudited)

(in millions)

    

 

Three Months Ended

March 31, 2021

 

Three Months Ended

March 31, 2020

 

GAAP (a)

 

Non-GAAP

Adjustments

 

 

 

GAAP (a)

 

Non-GAAP

Adjustments

 

 

Operating revenues

$

974

 

 

$

 

 

 

 

$

937

 

 

$

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

Purchased power and fuel

331

 

 

 

 

 

 

288

 

 

 

 

 

Operating and maintenance

197

 

 

(3)

 

 

(b),(c)

 

188

 

 

(1)

 

 

(d)

Depreciation and amortization

152

 

 

 

 

 

 

143

 

 

 

 

 

Taxes other than income taxes

72

 

 

 

 

 

 

69

 

 

 

 

 

Total operating expenses

752

 

 

 

 

 

 

688

 

 

 

 

 

Operating income

222

 

 

 

 

 

 

249

 

 

 

 

 

Other income and (deductions)

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

(34

)

 

 

 

 

 

(32

)

 

 

 

 

Other, net

8

 

 

 

 

 

 

5

 

 

 

 

 

Total other income and (deductions)

(26

)

 

 

 

 

 

(27

)

 

 

 

 

Income before income taxes

196

 

 

 

 

 

 

222

 

 

 

 

 

Income taxes

(13

)

 

1

 

 

(b),(c)

 

41

 

 

 

 

 

Net income

$

209

 

 

 

 

 

 

$

181

 

 

 

 

 

__________
(a) 

Results reported in accordance with accounting principles generally accepted in the United States (GAAP).

(b) 

Adjustment to exclude direct costs related to COVID-19 consisting primarily of costs to acquire personal protective equipment, costs for cleaning supplies and services, and costs to hire healthcare professionals to monitor the health of employees.

(c) 

Adjustment to exclude costs related to a multi-year Enterprise Resource Program (ERP) system implementation.

(d) 

Adjustment to exclude reorganization costs related to cost management programs.

PHI

GAAP Consolidated Statements of Operations and

Adjusted (non-GAAP) Operating Earnings Reconciling Adjustments

(unaudited)

(in millions)

 

 

Three Months Ended

March 31, 2021

 

Three Months Ended

March 31, 2020

 

GAAP (a)

 

Non-GAAP

Adjustments

 

 

 

GAAP (a)

 

Non-GAAP

Adjustments

 

 

Operating revenues

$

1,244

 

 

$

 

 

 

 

$

1,171

 

 

$

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

Purchased power and fuel

479

 

 

 

 

 

 

435

 

 

 

 

 

Operating and maintenance

256

 

 

(3)

 

 

(b),(c)

 

257

 

 

(3)

 

 

(d)

Depreciation and amortization

210

 

 

 

 

 

 

194

 

 

 

 

 

Taxes other than income taxes

113

 

 

 

 

 

 

114

 

 

 

 

 

Total operating expenses

1,058

 

 

 

 

 

 

1,000

 

 

 

 

 

Gain on sales of assets

 

 

 

 

 

 

2

 

 

 

 

 

Operating income

186

 

 

 

 

 

 

173

 

 

 

 

 

Other income and (deductions)

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

(67

)

 

 

 

 

 

(67

)

 

 

 

 

Other, net

17

 

 

 

 

 

 

13

 

 

 

 

 

Total other income and (deductions)

(50

)

 

 

 

 

 

(54

)

 

 

 

 

Income before income taxes

136

 

 

 

 

 

 

119

 

 

 

 

 

Income taxes

8

 

 

1

 

 

(b),(c)

 

11

 

 

1

 

 

(d)

Net income

$

128

 

 

 

 

 

 

$

108

 

 

 

 

 

__________
(a) 

Results reported in accordance with accounting principles generally accepted in the United States (GAAP).

(b) 

Adjustment to exclude costs related to a multi-year Enterprise Resource Program (ERP) system implementation.

(c) 

Adjustment to exclude costs related to the planned separation primarily comprised of third-party costs paid to advisors, consultants, lawyers, and other experts assisting in the planned separation as well as employee-related severance costs.

(d) 

Adjustment to exclude reorganization costs related to cost management programs.

Generation

GAAP Consolidated Statements of Operations and

Adjusted (non-GAAP) Operating Earnings Reconciling Adjustments

(unaudited)

(in millions)

    

 

Three Months Ended

March 31, 2021

 

Three Months Ended

March 31, 2020

 

GAAP (a)

 

Non-GAAP

Adjustments

 

 

 

GAAP (a)

 

Non-GAAP

Adjustments

 

 

Operating revenues

$

5,559

 

 

$

83

 

 

(b)

 

$

4,733

 

 

$

(179)

 

 

(b)

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

Purchased power and fuel

4,610

 

 

204

 

 

(b),(c)

 

2,704

 

 

(48)

 

 

(b)

Operating and maintenance

1,001

 

 

186

 

 

(c),(d),(e),(f),

(g),(h),(i)

 

1,263

 

 

(20)

 

 

(c),(d),(l)

Depreciation and amortization

940

 

 

(642

)

 

(c)

 

304

 

 

(10)

 

 

(c)

Taxes other than income taxes

121

 

 

 

 

 

 

129

 

 

 

 

 

Total operating expenses

6,672

 

 

 

 

 

 

4,400

 

 

 

 

 

Gain on sales of assets and businesses

71

 

 

(68)

 

 

(c)

 

 

 

 

 

 

Operating income (loss)

(1,042

)

 

 

 

 

 

333

 

 

 

 

 

Other income and (deductions)

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

(72

)

 

(3)

 

 

(b)

 

(109

)

 

12

 

 

(b)

Other, net

167

 

 

82

 

 

(j)

 

(771

)

 

879

 

 

(b),(j)

Total other income and (deductions)

95

 

 

 

 

 

 

(880

)

 

 

 

 

Income (loss) before income taxes

(947

)

 

 

 

 

 

(547

)

 

 

 

 

Income taxes

(179

)

 

105

 

 

(b),(c),(e),(f),

(g),(h),(i),(j)

 

(389

)

 

379

 

 

(b),(c),(d).(j),

(l)

Equity in losses of unconsolidated affiliates

(1

)

 

 

 

 

 

(3

)

 

 

 

 

Net income (loss)

(769

)

 

 

 

 

 

(161

)

 

 

 

 

Net (loss) income attributable to noncontrolling interests

24

 

 

18

 

 

(k)

 

(206

)

 

144

 

 

(k)

Net income (loss) attributable to membership interest

$

(793

)

 

 

 

 

 

$

45

 

 

 

 

 

__________
(a) 

Results reported in accordance with accounting principles generally accepted in the United States (GAAP).

(b) 

Adjustment to exclude the mark-to-market impact of Exelon’s economic hedging activities, net of intercompany eliminations.

(c) 

In 2021, adjustment to exclude accelerated depreciation and amortization associated with Generation's decision in the third quarter of 2020 to early retire Byron and Dresden nuclear facilities in 2021 and Mystic Units 8 and 9 in 2024, partially offset by a gain on sale of Generation's solar business. In 2020, adjustment to exclude accelerated depreciation and amortization expenses associated with the early retirement of certain fossil sites.

(d) 

Adjustment to exclude reorganization costs related to cost management programs.

(e) 

Adjustment to exclude costs related to the acquisition of Electricite de France SA's (EDF's) interest in CENG.

(f) 

Adjustment to exclude changes in environmental liabilities.

(g) 

Adjustment to exclude direct costs related to COVID-19 consisting primarily of costs to acquire personal protective equipment, costs for cleaning supplies and services, and costs to hire healthcare professionals to monitor the health of employees.

(h) 

Adjustment to exclude costs related to the planned separation primarily comprised of third-party costs paid to advisors, consultants, lawyers, and other experts assisting in the planned separation as well as employee-related severance costs.

(i) 

Adjustment to exclude costs related to a multi-year Enterprise Resource Program (ERP) system implementation.

(j) 

Adjustment to exclude the impact of net unrealized losses on Generation’s NDT fund investments for Non-Regulatory and Regulatory Agreement Units. The impacts of the Regulatory Agreement Units, including the associated income taxes, are contractually eliminated, resulting in no earnings impact.

(k) 

Adjustment to exclude elimination from Generation’s results of the noncontrolling interests related to certain exclusion items, primarily related to unrealized gains and losses on NDT fund investments for CENG units.

(l) 

Adjustment to exclude certain asset impairments.

Other (a)

GAAP Consolidated Statements of Operations and

Adjusted (non-GAAP) Operating Earnings Reconciling Adjustments

(unaudited)

(in millions)

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended

March 31, 2021

 

Three Months Ended

March 31, 2020

 

GAAP (b)

 

Non-GAAP

Adjustments

 

 

 

GAAP (b)

 

Non-GAAP

Adjustments

 

 

Operating revenues

$

(311

)

 

$

 

 

 

 

$

(346

)

 

$

 

 

 

Operating expenses

 

 

 

 

 

 

 

 

 

 

 

Purchased power and fuel

(295

)

 

 

 

 

 

(329

)

 

 

 

 

Operating and maintenance

(25

)

 

(2

)

 

(c)

 

(38

)

 

3

 

 

(f)

Depreciation and amortization

17

 

 

 

 

 

 

21

 

 

 

 

 

Taxes other than income taxes

14

 

 

 

 

 

 

11

 

 

 

 

 

Total operating expenses

(289

)

 

 

 

 

 

(335

)

 

 

 

 

Operating loss

(22

)

 

 

 

 

 

(11

)

 

 

 

 

Other income and (deductions)

 

 

 

 

 

 

 

 

 

 

 

Interest expense, net

(79

)

 

 

 

 

 

(72

)

 

4

 

 

(d)

Other, net

21

 

 

(2

)

 

(d)

 

15

 

 

 

 

 

Total other income and (deductions)

(58

)

 

 

 

 

 

(57

)

 

 

 

 

Loss before income taxes

(80

)

 

 

 

 

 

(68

)

 

 

 

 

Income taxes

116

 

 

1

 

 

(c),(d),(e)

 

(8

)

 

2

 

 

(d),(e),(f)

Net loss

(196

)

 

 

 

 

 

(60

)

 

 

 

 

Net income attributable to noncontrolling interests

1

 

 

 

 

 

 

 

 

 

 

 

Net loss attributable to common shareholders

$

(197

)

 

 

 

 

 

$

(60

)

 

 

 

 

__________
(a) 

Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities, and other financing and investment activities.

(b) 

Results reported in accordance with accounting principles generally accepted in the United States (GAAP).

(c) 

Adjustment to exclude costs related to the planned separation primarily comprised of third-party costs paid to advisors, consultants, lawyers, and other experts assisting in the planned separation as well as employee-related severance costs.

(d) 

Adjustment to exclude the mark-to-market impact of Exelon’s economic hedging activities, net of intercompany eliminations.

(e) 

Adjustment to exclude income tax-related adjustments.

(f) 

Adjustment to exclude reorganization related to cost management programs.

 

View source version on businesswire.com: https://www.businesswire.com/news/home/20210505005403/en/

Paul Adams

Corporate Communications

410-245-8717



Emily Duncan

Investor Relations

312-394-2345

Source: Exelon Corporation

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