UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, DC 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

January 25, 2006
Date of Report (Date of earliest event reported)

Commission File Number		Exact Name of Registrant as Specified in Its Charter; State of Incorporation; Address of Principal Executive Offices; and Telephone Number		IRS Employer Identification Number
1-16169		EXELON CORPORATION		23-2990190
		(a Pennsylvania corporation)
		10 South Dearborn Street—37th Floor
		P.O. Box 805379
		Chicago, Illinois 60680-5379
		(312) 394-7398
1-1839		COMMONWEALTH EDISON COMPANY		36-0938600
		(an Illinois corporation)
		440 South LaSalle Street
		Chicago, Illinois 60605-1028
		(312) 394-4321
1-1401		PECO ENERGY COMPANY		23-0970240
		(a Pennsylvania corporation)
		P.O. Box 8699
		2301 Market Street
		Philadelphia, Pennsylvania 19101-8699
		(215) 841-4000
333-85496		EXELON GENERATION COMPANY, LLC		23-3064219
		(a Pennsylvania limited liability company)
		300 Exelon Way
		Kennett Square, Pennsylvania 19348
		(610) 765-6900

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o		Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o		Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o		Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o		Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Section 2 – Financial Information
Item 2.02. Results of Operations and Financial Condition
Section 7 – Regulation FD
Item 7.01. Regulation FD Disclosure

On January 25, 2006, Exelon Corporation (Exelon) announced via press release Exelon’s results for the fourth quarter ended December 31, 2005. A copy of the press release and related attachments are attached hereto as Exhibit 99. This Form 8-K and the attached exhibit are provided under Items 2.02 and 7.01 of Form 8-K and are furnished to, but not filed with, the Securities and Exchange Commission (SEC).

Section 9 – Financial Statements and Exhibits
Item 9.01 – Financial Statements and Exhibits

(c) Exhibits

Exhibit No.		Description
99		Press release and earnings release attachments

*****

Forward-Looking Statements

This combined Form 8-K is being furnished separately by Exelon, Commonwealth Edison Company (ComEd), PECO Energy Company (PECO) and Exelon Generation Company, LLC (Generation) (Registrants). Information contained herein relating to any individual registrant has been furnished by such registrant on its own behalf. No registrant makes any representation as to information relating to any other registrant.

Except for the historical information contained herein, certain of the matters discussed in this Report are forward-looking statements, within the meaning of the Private Securities Litigation Reform Act of 1995, that are subject to risks and uncertainties. The factors that could cause actual results to differ materially from the forward-looking statements made by a registrant include those factors discussed herein, as well as the items discussed in (a) the Registrants’ 2004 Annual Report on Form 10-K—ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations—Business Outlook and the Challenges in Managing the Business for each of Exelon, ComEd, PECO and Generation, (b) the Registrants’ 2004 Annual Report on Form 10-K—ITEM 8. Financial Statements and Supplementary Data: Exelon—Note 20, ComEd—Note 15, PECO—Note 14 and Generation—Note 16, (c) Exelon’s Current Report on Form 8-K filed on May 13, 2005, including those discussed in Exhibit 99.2, “Management’s Discussion and Analysis of Financial Condition and Results of Operation” and Exhibit 99.3, “Financial Statements and Supplementary Data,” (d) Generation’s Current Report on Form 8-K filed on May 13, 2005, including those discussed in Exhibit 99.5, “Management’s Discussion and Analysis of Financial Condition and Results of Operation” and Exhibit 99.6, “Financial Statements and Supplementary Data” and (e) other factors discussed in filings with the SEC by the Registrants. Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this Report. 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 Report.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

January 25, 2006

Contact:		Marybeth Flater		FOR IMMEDIATE RELEASE
		Exelon Investor Relations
		312-394-8354
		Jennifer Medley
		Exelon Corporate Communications
		312-394-7189

Exelon Announces Strong Operating Results;
Records $1.2 Billion Charge against Goodwill;
Illinois Commerce Commission Approves Electricity Procurement Plan

CHICAGO (Jan. 25, 2006) – Exelon Corporation’s (Exelon) fourth quarter 2005 consolidated loss prepared in accordance with GAAP was $844 million, or $1.26 per share, compared with earnings of $363 million, or $0.54 per diluted share, in the fourth quarter of 2004. Full year 2005 consolidated earnings prepared in accordance with GAAP were $916 million, or $1.35 per diluted share, compared with $1,864 million, or $2.78 per diluted share in 2004.

The fourth quarter loss in reported earnings was driven by an impairment of the goodwill at Commonwealth Edison Company (ComEd), resulting in a non-cash charge of $1,207 million, or $1.81 per share. The current fair value of ComEd does not support the carrying value of its goodwill, in part, driven by the impending termination of a nine-year transition period to competition in Illinois and associated transition revenues at ComEd. This fourth quarter charge was greater than ComEd’s net income for 2004 and 2005 combined, exclusive of the goodwill impairment. For full year 2005, ComEd reported a net loss of $685 million, compared with net income of $676 million in 2004, primarily reflecting the impairment charge.

Full Year Operating Results

Full year 2005 adjusted (non-GAAP) operating earnings were $3.09 per diluted share, up 11 percent over 2004 adjusted (non-GAAP) operating earnings of $2.78 per diluted share. The full year adjusted (non-GAAP) operating earnings improvement was due to higher margins at Exelon Generation Company, LLC (Generation) and increased retail kWh deliveries at ComEd and PECO Energy Company (PECO), mostly attributable to favorable weather conditions that accounted for an estimated positive $0.12 per share.

“Our strong operating results in 2005 reflect the ongoing benefits of owning a large fleet of well-run, low-cost, low-emissions nuclear plants in today’s market environment,” said John W. Rowe, Exelon’s

chairman, president and CEO. “With $3.09 of operating earnings per share in 2005, Exelon has achieved nearly 10 percent average annual operating EPS growth since its formation in late 2000. Improving power market fundamentals, along with stable growth in our delivery businesses, will further drive earnings growth in 2006 and beyond.”

Fourth Quarter Operating Results

Exelon’s adjusted (non-GAAP) operating earnings for the fourth quarter of 2005 were $488 million, or $0.72 per diluted share, compared with $416 million, or $0.62 per diluted share, for the same period in 2004. The 16 percent year-over-year increase in adjusted (non-GAAP) operating earnings per share was the result of higher margins on wholesale market sales at Generation and increased retail deliveries at ComEd and PECO.

A non-GAAP financial measure, adjusted (non-GAAP) operating earnings for the fourth quarter of 2005 do not include the following items that are included in reported GAAP earnings (all after tax):

	•		Charge of $1,207 million, or $1.81 per share, related to the impairment of ComEd’s goodwill.
	•		Unrealized mark-to-market losses of $88 million, or $0.13 per diluted share, from non-trading activities at Exelon (primarily Generation).
	•		Losses of $42 million, or $0.06 per diluted share, for the cumulative effect of adopting FIN No. 47, “Accounting for Conditional Asset Retirement Obligations” (FIN 47).
	•		Earnings of $10 million, or $0.02 per diluted share, resulting from investments in synthetic fuel-producing facilities.
	•		Costs of $8 million, or $0.01 per diluted share, related to certain integration costs associated with the proposed merger with Public Service Enterprise Group Incorporated (PSEG).

Adjusted (non-GAAP) operating earnings for the fourth quarter of 2004 did not include the following items that were included in reported GAAP earnings (all after tax):

	•		Unrealized mark-to-market losses of $25 million, or $0.04 per diluted share, from non-trading activities at Generation.
	•		Earnings of $23 million, or $0.04 per diluted share, resulting from investments in synthetic fuel-producing facilities.
	•		Severance and severance-related costs of $19 million, or $0.03 per diluted share.
	•		Charges totaling $14 million, or $0.02 per diluted share, for premiums paid on and other costs associated with ComEd debt repurchases.
	•		Charges of $11 million, or $0.02 per diluted share, associated with Generation’s investment in Sithe Energies, Inc. (Sithe).

•

Costs of $4 million, or $0.01 per diluted share, related to certain integration costs associated with the proposed merger with PSEG.

Illinois Commerce Commission (ICC) Approves Electricity Procurement Plan

The ICC yesterday approved ComEd’s procurement case, authorizing ComEd to procure power after 2006 through a “reverse-auction” competitive bidding process and to recover the costs from retail customers with no markup. The auction will be administered by an independent auction manager, with oversight by the ICC staff. The first auction is scheduled to take place during the fall at which time ComEd’s entire load will be up for bid. To mitigate the effects of changes in future prices, the load will be staggered in three-year contracts. To further mitigate the impact on its residential customers of transitioning to this process, ComEd has pledged to develop a “cap and deferral” proposal to keep residential rates at or below 1995 levels through the end of 2009. The company plans to work with interested stakeholders to ease the transition from frozen rates.

“Opposition to ComEd’s procurement proposal had put a cloud of uncertainty over both ComEd’s financial future and its ability to supply reliable electricity at a reasonable price to residents of northern Illinois,” said Rowe. “Yesterday’s decision by the Illinois Commerce Commission to approve that proposal is an important milestone for ComEd as it lifts much of the uncertainty about its financial future. Now ComEd can get on with managing the normal business risks that any electric utility faces. The ICC decision is also an important victory for Illinois consumers because the ICC recognizes that a competitive procurement process will help ensure the lowest available market prices for the energy ComEd delivers.”

2006 Earnings Outlook

“We are reaffirming our 2006 guidance range of $3.00 to $3.30 per share,” said Rowe, “which reflects our expectations for continued strength in our core businesses.” Exelon’s 2006 guidance is for adjusted (non-GAAP) operating earnings.

Exelon’s outlook for 2006 adjusted (non-GAAP) operating earnings excludes unrealized mark-to-market adjustments from non-trading activities, income resulting from investments in synthetic fuel-producing facilities, significant impairments of intangible assets, certain severance costs, and costs associated with the proposed merger with PSEG. Giving consideration to these factors, Exelon estimates GAAP earnings will fall in the range of $3.05 to $3.35 per share in 2006. These estimates do not include any impact of future changes to GAAP. Earnings guidance is based on the assumption of normal weather.

Fourth Quarter Highlights

	•		Proposed Merger with PSEG: On December 20, 2004, Exelon entered into a merger agreement with PSEG, and shareholders of both companies approved the transaction in July 2005. The merger also received approval from regulatory agencies in New York and Connecticut, in addition to the Federal Energy Regulatory Commission (FERC) approval in June. On September 13, 2005, Exelon announced that PECO had reached a settlement, subject to approval, with some but not all of the parties related to the Pennsylvania review of the proposed merger. The Pennsylvania Public Utility Commission is expected to vote on the case on January 27.
			In New Jersey, hearings for the merger review have been extended; they are expected to conclude February 27. Settlement discussions began in December and are expected to resume after the

			hearings conclude. Scheduled dates for the Administrative Law Judge’s (ALJ) initial decision and final order from the New Jersey Board of Public Utilities (NJBPU) also may be extended, but no firm dates have been set.
			Other remaining regulatory reviews include the U.S. Department of Justice (DOJ). Exelon still expects to complete all of the regulatory reviews and close the merger late in the second quarter of 2006. It may occur earlier if a settlement is concluded and accepted by the NJBPU. Rowe said, “We are eager to finish the regulatory process with DOJ and in New Jersey. We will finish substantially all of our merger integration planning work by the middle of February, so we will be ready to close the deal as soon as we get the necessary regulatory approvals.”
	•		Circuit Court Case: In ComEd’s procurement case, various intervenors, including the Illinois Attorney General (AG) and the Citizens’ Utility Board (CUB), unsuccessfully challenged the ICC’s authority to approve the procurement process and associated cost recovery. On September 1, 2005, these same intervenors and others (the Plaintiffs) filed a complaint in the Circuit Court of Cook County against the ICC raising similar arguments and seeking an injunction prohibiting ICC approval of the procurement case proposals. On January 20, 2006 the court issued its decision dismissing Plantiffs’ case.
	•		ComEd Rate Case: On August 31, 2005, ComEd filed a proposal with the Illinois Commerce Commission (ICC) seeking approval of its first general rate case since January 1995. The rate case filing seeks to allocate the costs of supplying electricity and to adjust ComEd’s rates for delivering electricity to users in its service area, effective January 2007, in order to reflect ComEd’s rising costs and significant capital investment in its delivery system. The ICC staff has expressed opposition to the rate proposal. Hearings in the case are scheduled for late March, and an ALJ proposed order is expected in early June. An ICC order on the rate increase request is expected in late July 2006.
	•		ComEd Organizational Changes: On November 28, 2005, ComEd announced several actions intended to affirm the fact that ComEd is an independent entity, separate and distinct from its parent, Exelon, and to strengthen the company’s ability to successfully manage financial and strategic issues as Illinois completes its transition to restructuring after 2006. The actions included the election of a new five-member board of directors and a slate of senior officers. These senior officers no longer have responsibilities at Exelon.
	•		ComEd Goodwill: ComEd and Exelon completed their required annual assessment of goodwill impairment. The assessment compares the carrying value of goodwill to the estimated fair value of goodwill as of a point in time (November 1). The estimated fair value incorporates management’s assessment of current events and expected future cash flows. The 2005 test indicated that ComEd’s and Exelon’s goodwill was impaired and a non-cash charge of $1,207 million was recorded by both companies. This impairment occurred because ComEd’s projected cash flows do not support the carrying value of ComEd’s goodwill, and was driven by the upcoming end of ComEd’s transition period and related transition revenues, regulatory uncertainty in Illinois as of November 1, 2005, anticipated increases in capital expenditures in future years, decreases in market valuations of comparable companies that are utilized to estimate the fair value of ComEd and changes in the fair value of ComEd’s power purchase agreement with Generation.

			After reflecting the impairment, ComEd and Exelon have $3,475 million of goodwill as of December 31, 2005.
	•		Nuclear Operations: Generation’s nuclear fleet, including its owned output from the Salem Generating Station operated by PSEG and co-owned by Generation, produced 34,887 GWhs in the fourth quarter of 2005, compared with 33,653 GWhs in the fourth quarter of 2004. The Exelon Nuclear-operated plants completed four scheduled refueling outages (two began in the third quarter) with 73 refueling outage days occurring in the fourth quarter of 2005 compared with four scheduled refueling outages (one began in the third quarter) with 90 refueling outage days in the fourth quarter of 2004. Operating expenses associated with the planned refueling outages were approximately $2 million after-tax higher in the fourth quarter of 2005 compared with the fourth quarter of 2004. Total non-refueling outage days for the Exelon Nuclear-operated plants in the fourth quarter of 2005 were 28 versus 45 in the fourth quarter of 2004. Also in the fourth quarter of 2005, the Salem Generating Station completed a 25-day scheduled refueling outage compared to having no scheduled refueling outages in the fourth quarter of 2004. For the full year 2005, the Exelon Nuclear-operated plants achieved a 93.5 percent capacity factor, consistent with the prior year.

BUSINESS UNIT RESULTS

ComEd consists of the retail and wholesale electricity transmission and distribution operations in northern Illinois. ComEd’s net loss in the fourth quarter of 2005 was $1,088 million compared with net income of $164 million in the fourth quarter of 2004. The fourth quarter 2005 net loss included (all after tax) a non-cash charge of $1,207 million related to the impairment of ComEd’s goodwill, losses of $9 million for the cumulative effect of adopting FIN 47, expenses of $2 million related to certain integration costs associated with the proposed merger with PSEG and a reduction in severance and severance-related reserves of $1 million. Fourth quarter 2004 net income at ComEd included (all after tax) charges of $14 million related to costs associated with ComEd’s debt retirements and severance and severance-related costs of $4 million. Excluding the impact of these items, ComEd’s net income decreased $53 million compared with the same quarter last year, primarily due to higher purchased power expense attributable to a contractual increase in prices associated with ComEd’s power purchase agreement with Generation, and higher operating and maintenance expenses, partially offset by increased retail kWh deliveries and lower interest expense.

Heating degree-days for the fourth quarter of 2005 in the ComEd service territory were up 11 percent relative to the same period in 2004 and close to normal. Retail kWh deliveries increased 4 percent in 2005 as compared with 2004 for ComEd, with a 10 percent increase in deliveries to the residential customer class. ComEd’s fourth quarter 2005 revenues were $1,442 million, up 7 percent from $1,344 million in 2004. For ComEd, weather had a favorable after-tax impact of $16 million on fourth quarter 2005 earnings relative to 2004 and had a favorable after-tax impact of $7 million relative to the normal weather that was incorporated in earnings guidance.

PECO consists of the retail electricity transmission and distribution operations and the retail and wholesale natural gas distribution business in southeastern Pennsylvania. PECO’s net income in the fourth quarter of 2005 was $101 million compared with net income of $84 million in the fourth quarter of 2004. Fourth quarter 2005 net income included (all after tax) costs of $4 million related to certain integration costs associated with the proposed merger with PSEG and losses of $3 million for the cumulative effect of adopting FIN 47. Fourth quarter 2004 net income included after-tax severance and

severance-related costs of $3 million. Excluding the impact of these items, PECO’s net income increased $21 million compared with the same quarter last year, primarily due to increased retail kWh deliveries and lower interest expense, partially offset by higher competitive transition cost (CTC) amortization.

In the PECO service territory, heating degree-days were up 3 percent compared with 2004 and were 2 percent below normal. PECO’s retail kWh deliveries increased 3 percent, with residential deliveries up 10 percent. PECO’s fourth quarter 2005 revenues were $1,249 million, up 14 percent from $1,092 million in 2004. For PECO, weather had a favorable after-tax impact of $5 million on fourth quarter 2005 earnings relative to 2004 and was neutral relative to the normal weather that was incorporated in earnings guidance.

Exelon Generation consists of Exelon’s electric generation operations, competitive retail sales and power marketing and trading functions. Fourth quarter 2005 net income was $151 million compared with $74 million in the fourth quarter of 2004. Fourth quarter 2005 net income included (all after tax) unrealized mark-to-market losses of $86 million from non-trading activities, losses of $30 million for the cumulative effect of adopting FIN 47, expenses of $3 million related to certain integration costs associated with the proposed merger with PSEG and income of $2 million associated with its previous investment in Sithe. Fourth quarter 2004 net income included (all after tax) unrealized mark-to-market losses of $25 million from non-trading activities, expenses of $11 million associated with its previous investment in Sithe, severance-related costs of $9 million and expenses of $3 million associated with its previous investment in Boston Generating. Excluding the impact of these items, Generation’s net income increased $146 million compared with the same quarter last year, primarily due to higher revenue, net of purchased power and fuel expense.

Generation’s revenue, net of purchased power and fuel expense, increased by $213 million in the fourth quarter of 2005 compared with the fourth quarter of 2004 excluding the mark-to-market impact in both years. The quarter-over-quarter increase in revenue, net of purchased power and fuel expense, was driven by higher average margins on wholesale market sales due to having previously re-priced forward hedges at higher prices, combined with higher spot market prices, the contractual increase in prices associated with Generation’s power sales agreement with ComEd and the impact of higher nuclear output.

Generation’s average realized margin on all electric sales, including sales to affiliates and excluding trading activity, was $22.03 per MWh in the fourth quarter of 2005 compared with $17.91 per MWh in the fourth quarter of 2004.

Adjusted (non-GAAP) Operating Earnings

Adjusted (non-GAAP) operating earnings, which generally exclude significant one-time charges or credits that are not normally associated with ongoing operations and unrealized mark-to-market adjustments from non-trading activities, are provided as a supplement to results reported in accordance with GAAP. Management uses such adjusted (non-GAAP) operating earnings measures internally to evaluate the company’s performance and manage its operations. Reconciliations of GAAP to adjusted (non-GAAP) operating earnings for historical periods are attached. Additional earnings release attachments, which include these reconciliations on pages 7 and 8, are posted on Exelon’s Web site: www.exeloncorp.com and have been filed with the Securities and Exchange Commission on Form 8-K on January 25, 2006.

Note: In 2005, prior to the fourth quarter, Exelon operated in two business segments – Energy Delivery (ComEd and PECO) and Generation. As a result of the regulatory and organizational changes described

in this release, ComEd and PECO are no longer reported as a combined Energy Delivery segment and are presented as separate segments.

Conference call information: Exelon has scheduled a conference call for 11 AM ET (10 AM CT) on January 25, 2006. The call-in number in the U.S. is 888-802-8581, and the international call-in number is 973-935-8515. No password is required. Media representatives are invited to participate on a listen-only basis. The call will be web-cast and archived on Exelon’s Web site: www.exeloncorp.com. (Please select the Investor Relations page.)

Telephone replays will be available until February 10. The U.S. call-in number for replays is 877-519-4471, and the international call-in number is 973-341-3080. The confirmation code is 6888714.

This news release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, that are subject to risks and uncertainties. The factors that could cause actual results to differ materially from these forward-looking statements include those discussed herein as well as those discussed in (1) Exelon Corporation’s 2004 Annual Report on Form 10-K in (a) ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations-Business Outlook and the Challenges in Managing the Business for each of Exelon, ComEd, PECO and Generation and (b) ITEM 8. Financial Statements and Supplementary Data: Exelon-Note 20, ComEd-Note 15, PECO-Note 14 and Generation-Note 16 and (2) Exelon’s Current Report on Form 8-K filed on May 13, 2005 in (a) Exhibit 99.2 Management’s Discussion and Analysis of Financial Condition and Results of Operations — Exelon — Business Outlook and the Challenges in Managing the Business and (b) Exhibit 99.3 Financial Statements and Supplementary Data — Exelon Corporation and (3) other factors discussed in filings with the Securities and Exchange Commission (SEC) by Exelon Corporation, Commonwealth Edison Company, PECO Energy Company and Exelon Generation Company, LLC (Companies). A discussion of risks associated with the proposed merger of Exelon and Public Service Enterprise Group, Incorporated (PSEG) is included in the joint proxy statement/prospectus that Exelon filed with the SEC pursuant to Rule 424(b)(3) on June 3, 2005 (Registration No. 333-122704). Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this news release. None of the Companies undertakes any obligation to publicly release any revision to its forward-looking statements to reflect events or circumstances after the date of this news release.

###

Exelon Corporation is one of the nation’s largest electric utilities with approximately 5.2 million customers and more than $15 billion in annual revenues. The company has one of the industry’s largest portfolios of electricity generation capacity, with a nationwide reach and strong positions in the Midwest and Mid-Atlantic. Exelon distributes electricity to approximately 5.2 million customers in Illinois and Pennsylvania and gas to approximately 460,000 customers in the Philadelphia area. Exelon is headquartered in Chicago and trades on the NYSE under the ticker EXC.

EXELON CORPORATION
Earnings Release Attachments
Table of Contents

Consolidating Statements of Income — Three Months Ended December 31, 2005 and 2004 (a)			1
Consolidating Statements of Income — Twelve Months Ended December 31, 2005 and 2004 (a)			2
Business Segment Comparative Income Statements — ComEd and PECO — Three and Twelve Months Ended December 31, 2005 and 2004 (a)			3
Business Segment Comparative Income Statements — Generation and Other — Three and Twelve Months Ended December 31, 2005 and 2004 (a)			4
Consolidated Balance Sheets — December 31, 2005 and 2004			5
Consolidated Statements of Cash Flows — Twelve Months Ended December 31, 2005 and 2004			6
Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Income — Three Months Ended December 31, 2005 and 2004 (a)			7
Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Income — Twelve Months Ended December 31, 2005 and 2004 (a)			8
Reconciliation of Adjusted (non-GAAP) Operating Earnings Per Diluted Share to GAAP Earnings Per Diluted Share — Three Months Ended December 31, 2005 and 2004			9
Reconciliation of Adjusted (non-GAAP) Operating Earnings Per Diluted Share to GAAP Earnings Per Diluted Share — Twelve Months Ended December 31, 2005 and 2004			10
Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Income — ComEd — Three and Twelve Months Ended December 31, 2005 and 2004			11
Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Income — PECO — Three and Twelve Months Ended December 31, 2005 and 2004			12
Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Income — Generation — Three and Twelve Months Ended December 31, 2005 and 2004 (a)			13
Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Income — Other — Three and Twelve Months Ended December 31, 2005 and 2004 (a)			14
Electric Sales Statistics — Three and Twelve Months Ended December 31, 2005 and 2004			15
ComEd and PECO Sales Statistics — Three Months Ended December 31, 2005 and 2004			16
ComEd and PECO Sales Statistics — Twelve Months Ended December 31, 2005 and 2004			17
Exelon Generation Power Marketing Statistics — Three Months Ended December 31, 2005, September 30, 2005, June 30, 2005, March 31, 2005 and December 31, 2004			18
Exelon Generation Power Marketing Statistics — Twelve Months Ended December 31, 2005 and 2004			19

EXELON CORPORATION
Consolidating Statements of Income
(unaudited)
(in millions)

		Three Months Ended December 31, 2005
																		Exelon
		ComEd				PECO				Generation				Other				Consolidated
Operating revenues		$	1,442			$	1,249			$	2,210			$	(1,063	)		$	3,838
Operating expenses
Purchased power			759				464				555				(1,057	)			721
Fuel			—				224				686				3				913
Operating and maintenance			219				153				533				3				908
Impairment of goodwill			1,207				—				—				—				1,207
Depreciation and amortization			105				135				65				26				331
Taxes other than income			71				59				48				6				184
Total operating expenses			2,361				1,035				1,887				(1,019	)			4,264
Operating income (loss)			(919	)			214				323				(44	)			(426	)
Other income and deductions
Interest expense			(73	)			(69	)			(37	)			(36	)			(215	)
Equity in losses of unconsolidated affiliates			(3	)			(3	)			(3	)			(18	)			(27	)
Other, net			6				3				13				4				26
Total other income and deductions			(70	)			(69	)			(27	)			(50	)			(216	)
Income (loss) from continuing operations before income taxes			(989	)			145				296				(94	)			(642	)
Income taxes			90				41				117				(87	)			161
Income (loss) from continuing operations			(1,079	)			104				179				(7	)			(803	)
Income (loss) from discontinued operations			—				—				2				(1	)			1
Income (loss) before cumulative effect of a change in accounting principle			(1,079	)			104				181				(8	)			(802	)
Cumulative effect of a change in accounting principle, net of income taxes			(9	)			(3	)			(30	)			—				(42	)
Net income (loss)		$	(1,088	)		$	101			$	151			$	(8	)		$	(844	)

		Three Months Ended December 31, 2004
																		Exelon
		ComEd				PECO				Generation				Other				Consolidated
Operating revenues		$	1,344			$	1,092			$	1,726			$	(850	)		$	3,312
Operating expenses
Purchased power			575				388				445				(843	)			565
Fuel			—				160				427				(4	)			583
Operating and maintenance			228				159				597				20				1,004
Depreciation and amortization			101				123				74				23				321
Taxes other than income			71				55				32				4				162
Total operating expenses			975				885				1,575				(800	)			2,635
Operating income (loss)			369				207				151				(50	)			677
Other income and deductions
Interest expense			(81	)			(74	)			(24	)			(17	)			(196	)
Equity in losses of unconsolidated affiliates			(7	)			(6	)			(7	)			(36	)			(56	)
Other, net			(12	)			10				12				7				17
Total other income and deductions			(100	)			(70	)			(19	)			(46	)			(235	)
Income (loss) from continuing operations before income taxes and minority interest			269				137				132				(96	)			442
Income taxes			105				53				47				(154	)			51
Income from continuing operations before minority interest			164				84				85				58				391
Minority interest			—				—				2				—				2
Income from continuing operations			164				84				87				58				393
Loss from discontinued operations			—				—				(13	)			(17	)			(30	)
Net income		$	164			$	84			$	74			$	41			$	363

EXELON CORPORATION
Consolidating Statements of Income
(unaudited)
(in millions)

		Twelve Months Ended December 31, 2005
																		Exelon
		ComEd				PECO				Generation				Other				Consolidated
Operating revenues		$	6,264			$	4,910			$	9,046			$	(4,863	)		$	15,357
Operating expenses
Purchased power			3,520				1,918				2,569				(4,845	)			3,162
Fuel			—				597				1,913				(26	)			2,484
Operating and maintenance			833				549				2,281				48				3,711
Impairment of goodwill			1,207				—				—				—				1,207
Depreciation and amortization			413				566				254				101				1,334
Taxes other than income			303				248				170				24				745
Total operating expenses			6,276				3,878				7,187				(4,698	)			12,643
Operating income (loss)			(12	)			1,032				1,859				(165	)			2,714
Other income and deductions
Interest expense			(295	)			(281	)			(128	)			(126	)			(830	)
Equity in losses of unconsolidated affiliates			(14	)			(16	)			(1	)			(103	)			(134	)
Other, net			8				14				95				17				134
Total other income and deductions			(301	)			(283	)			(34	)			(212	)			(830	)
Income (loss) from continuing operations before income taxes			(313	)			749				1,825				(377	)			1,884
Income taxes			363				240				712				(375	)			940
Income (loss) from continuing operations			(676	)			509				1,113				(2	)			944
Income (loss) from discontinued operations			—				—				19				(5	)			14
Income (loss) before cumulative effect of a change in accounting principle			(676	)			509				1,132				(7	)			958
Cumulative effect of a change in accounting principle, net of income taxes			(9	)			(3	)			(30	)			—				(42	)
Net income (loss)		$	(685	)		$	506			$	1,102			$	(7	)		$	916

		Twelve Months Ended December 31, 2004
																		Exelon
		ComEd				PECO				Generation				Other				Consolidated
Operating revenues		$	5,803			$	4,487			$	7,703			$	(3,860	)		$	14,133
Operating expenses
Purchased power			2,588				1,644				2,307				(3,830	)			2,709
Fuel			—				528				1,704				(12	)			2,220
Operating and maintenance			897				547				2,201				55				3,700
Depreciation and amortization			410				518				286				81				1,295
Taxes other than income			291				236				166				17				710
Total operating expenses			4,186				3,473				6,664				(3,689	)			10,634
Operating income (loss)			1,617				1,014				1,039				(171	)			3,499
Other income and deductions
Interest expense			(369	)			(303	)			(103	)			(53	)			(828	)
Equity in losses of unconsolidated affiliates			(19	)			(25	)			(14	)			(96	)			(154	)
Other, net			(96	)			18				130				8				60
Total other income and deductions			(484	)			(310	)			13				(141	)			(922	)
Income (loss) from continuing operations before income taxes and minority interest			1,133				704				1,052				(312	)			2,577
Income taxes			457				249				401				(394	)			713
Income from continuing operations before minority interest			676				455				651				82				1,864
Minority interest			—				—				6				—				6
Income from continuing operations			676				455				657				82				1,870
Loss from discontinued operations			—				—				(16	)			(13	)			(29	)
Income from before cumulative effect of changes in accounting principles			676				455				641				69				1,841
Cumulative effect of changes in accounting principles, net of income taxes			—				—				32				(9	)			23
Net income		$	676			$	455			$	673			$	60			$	1,864

EXELON CORPORATION
Business Segment Comparative Income Statements
(unaudited)
(in millions)

		ComEd
		Three Months Ended December 31,												Twelve Months Ended December 31,
		2005				2004				Variance				2005				2004				Variance
Operating revenues		$	1,442			$	1,344			$	98			$	6,264			$	5,803			$	461
Operating expenses
Purchased power			759				575				184				3,520				2,588				932
Operating and maintenance			219				228				(9	)			833				897				(64	)
Impairment of goodwill			1,207				—				1,207				1,207				—				1,207
Depreciation and amortization			105				101				4				413				410				3
Taxes other than income			71				71				—				303				291				12
Total operating expenses			2,361				975				1,386				6,276				4,186				2,090
Operating income (loss)			(919	)			369				(1,288	)			(12	)			1,617				(1,629	)
Other income and deductions
Interest expense			(73	)			(81	)			8				(295	)			(369	)			74
Equity in losses of unconsolidated affiliates			(3	)			(7	)			4				(14	)			(19	)			5
Other, net			6				(12	)			18				8				(96	)			104
Total other income and deductions			(70	)			(100	)			30				(301	)			(484	)			183
Income (loss) before income taxes			(989	)			269				(1,258	)			(313	)			1,133				(1,446	)
Income taxes			90				105				(15	)			363				457				(94	)
Income (loss) before cumulative effect of a change in accounting principle			(1,079	)			164				(1,243	)			(676	)			676				(1,352	)
Cumulative effect of a change in accounting principle, net of income taxes			(9	)			—				(9	)			(9	)			—				(9	)
Net income (loss)		$	(1,088	)		$	164			$	(1,252	)		$	(685	)		$	676			$	(1,361	)

		PECO
		Three Months Ended December 31,												Twelve Months Ended December 31,
		2005				2004				Variance				2005				2004				Variance
Operating revenues		$	1,249			$	1,092			$	157			$	4,910			$	4,487			$	423
Operating expenses
Purchased power			464				388				76				1,918				1,644				274
Fuel			224				160				64				597				528				69
Operating and maintenance			153				159				(6	)			549				547				2
Depreciation and amortization			135				123				12				566				518				48
Taxes other than income			59				55				4				248				236				12
Total operating expenses			1,035				885				150				3,878				3,473				405
Operating income			214				207				7				1,032				1,014				18
Other income and deductions
Interest expense			(69	)			(74	)			5				(281	)			(303	)			22
Equity in losses of unconsolidated affiliates			(3	)			(6	)			3				(16	)			(25	)			9
Other, net			3				10				(7	)			14				18				(4	)
Total other income and deductions			(69	)			(70	)			1				(283	)			(310	)			27
Income before income taxes			145				137				8				749				704				45
Income taxes			41				53				(12	)			240				249				(9	)
Income before cumulative effect of a change in accounting principle			104				84				20				509				455				54
Cumulative effect of a change in accounting principle, net of income taxes			(3	)			—				(3	)			(3	)			—				(3	)
Net income		$	101			$	84			$	17			$	506			$	455			$	51

EXELON CORPORATION
Business Segment Comparative Income Statements
(unaudited)
(in millions)

		Generation
		Three Months Ended December 31,												Twelve Months Ended December 31,
		2005				2004				Variance				2005				2004				Variance
Operating revenues		$	2,210			$	1,726			$	484			$	9,046			$	7,703			$	1,343
Operating expenses
Purchased power			555				445				110				2,569				2,307				262
Fuel			686				427				259				1,913				1,704				209
Operating and maintenance			533				597				(64	)			2,281				2,201				80
Depreciation and amortization			65				74				(9	)			254				286				(32	)
Taxes other than income			48				32				16				170				166				4
Total operating expenses			1,887				1,575				312				7,187				6,664				523
Operating income			323				151				172				1,859				1,039				820
Other income and deductions
Interest expense			(37	)			(24	)			(13	)			(128	)			(103	)			(25	)
Equity in losses of unconsolidated affiliates			(3	)			(7	)			4				(1	)			(14	)			13
Other, net			13				12				1				95				130				(35	)
Total other income and deductions			(27	)			(19	)			(8	)			(34	)			13				(47	)
Income from continuing operations before income taxes and minority interest			296				132				164				1,825				1,052				773
Income taxes			117				47				70				712				401				311
Income from continuing operations before minority interest			179				85				94				1,113				651				462
Minority interest			—				2				(2	)			—				6				(6	)
Income from continuing operations			179				87				92				1,113				657				456
Income (loss) from discontinued operations			2				(13	)			15				19				(16	)			35
Income before cumulative effect of a change in accounting principle			181				74				107				1,132				641				491
Cumulative effect of a change in accounting principle, net of income taxes			(30	)			—				(30	)			(30	)			32				(62	)
Net income		$	151			$	74			$	77			$	1,102			$	673			$	429

		Other (a)
		Three Months Ended December 31,												Twelve Months Ended December 31,
		2005				2004				Variance				2005				2004				Variance
Operating revenues		$	(1,063	)		$	(850	)		$	(213	)		$	(4,863	)		$	(3,860	)		$	(1,003	)
Operating expenses
Purchased power			(1,057	)			(843	)			(214	)			(4,845	)			(3,830	)			(1,015	)
Fuel			3				(4	)			7				(26	)			(12	)			(14	)
Operating and maintenance			3				20				(17	)			48				55				(7	)
Depreciation and amortization			26				23				3				101				81				20
Taxes other than income			6				4				2				24				17				7
Total operating expenses			(1,019	)			(800	)			(219	)			(4,698	)			(3,689	)			(1,009	)
Operating loss			(44	)			(50	)			6				(165	)			(171	)			6
Other income and deductions
Interest expense			(36	)			(17	)			(19	)			(126	)			(53	)			(73	)
Equity in losses of unconsolidated affiliates			(18	)			(36	)			18				(103	)			(96	)			(7	)
Other, net			4				7				(3	)			17				8				9
Total other income and deductions			(50	)			(46	)			(4	)			(212	)			(141	)			(71	)
Loss from continuing operations before income taxes			(94	)			(96	)			2				(377	)			(312	)			(65	)
Income taxes			(87	)			(154	)			67				(375	)			(394	)			19
Income (loss) from continuing operations			(7	)			58				(65	)			(2	)			82				(84	)
Loss from discontinued operations			(1	)			(17	)			16				(5	)			(13	)			8
Income (loss) before cumulative effect of a change in accounting principle			(8	)			41				(49	)			(7	)			69				(76	)
Cumulative effect of a change in accounting principle, net of income taxes			—				—				—				—				(9	)			9
Net income (loss)		$	(8	)		$	41			$	(49	)		$	(7	)		$	60			$	(67	)

EXELON CORPORATION
Consolidated Balance Sheets
(unaudited)
(in millions)

		December 31,				December 31,
		2005				2004
Current assets
Cash and cash equivalents		$	140			$	499
Restricted cash and investments			49				60
Accounts receivable, net
Customers			1,858				1,649
Other			343				409
Mark-to-market derivative assets			916				403
Inventories — fossil fuel			311				230
Inventories — materials and supplies			351				312
Deferred income taxes			77				68
Other			595				250
Total current assets			4,640				3,880
Property, plant and equipment, net			21,981				21,482
Deferred debits and other assets
Regulatory assets			4,386				4,790
Nuclear decommissioning trust funds			5,585				5,262
Investments			813				804
Goodwill			3,475				4,705
Mark-to-market derivative assets			311				383
Pension asset			377				—
Other			824				1,418
Total deferred debits and other assets			15,771				17,362
Total assets		$	42,392			$	42,724
Liabilities and shareholders’ equity
Current liabilities
Notes payable		$	1,290			$	490
Long-term debt due within one year			407				427
Long-term debt to ComEd Transitional Funding Trust and PECO Energy Transition Trust due within one year			507				486
Accounts payable			1,467				1,255
Mark-to-market derivative liabilities			1,282				598
Accrued expenses			1,014				1,097
Other			605				483
Total current liabilities			6,572				4,836
Long-term debt			7,759				7,292
Long-term debt to ComEd Transitional Funding
Trust and PECO Energy Transition Trust			3,456				4,311
Long-term debt to other financing trusts			545				545
Deferred credits and other liabilities
Deferred income taxes			4,816				4,488
Unamortized investment tax credits			262				275
Asset retirement obligations			4,157				3,981
Pension obligations			268				1,993
Non-pension postretirement benefits obligations			1,014				1,065
Spent nuclear fuel obligation			906				878
Regulatory liabilities			2,170				2,204
Mark-to-market derivative liabilities			462				323
Other			798				915
Total deferred credits and other liabilities			14,853				16,122
Total liabilities			33,185				33,106
Minority interest of consolidated subsidiaries			1				42
Preferred securities of subsidiaries			87				87
Shareholders’ equity
Common stock			7,987				7,664
Treasury stock, at cost			(444	)			(82	)
Retained earnings			3,200				3,353
Accumulated other comprehensive loss			(1,624	)			(1,446	)
Total shareholders’ equity			9,119				9,489
Total liabilities and shareholders’ equity		$	42,392			$	42,724