| UNITED STATES SECURITIES AND EXCHANGE COMMISSION | |||||||||||
| Washington, D.C. 20549 | |||||||||||
| FORM | |||||||||||
| CURRENT REPORT | |||||||||||
| Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 | |||||||||||
| Date of Report (Date of earliest event reported) | |||||||||||
| Commission File Number | Name of Registrant; State or Other Jurisdiction of Incorporation; Address of Principal Executive Offices; and Telephone Number | IRS Employer Identification Number | ||||||||||||
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| 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: | |||||
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
| Securities registered pursuant to Section 12(b) of the Act: | ||||||||||||||
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
| EXELON CORPORATION: | ||||||||||||||
| PECO ENERGY COMPANY: | ||||||||||||||
Trust Receipts of PECO Energy Capital Trust III, each representing a 7.38% | ||||||||||||||
Indicate by check mark whether any of the registrants are emerging growth companies as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter). Emerging growth company | ||
| If an emerging growth company, indicate by check mark if any of the registrants have elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐ | ||
Section 2 - Financial Information
Item 2.02. Results of Operations and Financial Condition.
Section 7 - Regulation FD
Item 7.01. Regulation FD Disclosure.
On August 2, 2023, Exelon Corporation (Exelon) announced via press release its results for the second quarter ended June 30, 2023. A copy of the press release and related attachments are attached hereto as Exhibit 99.1. Also attached as Exhibit 99.2 to this Current Report on Form 8-K are the presentation slides to be used at the second quarter 2023 earnings conference call. This Form 8-K and the attached exhibits are provided under Items 2.02, 7.01 and 9.01 of Form 8-K and are furnished to, but not filed with, the Securities and Exchange Commission.
Exelon has scheduled the conference call for 9:00 AM CT (10:00 AM ET) on August 2, 2023. Participants who would like to join the call to ask a question may register at the link found on the Investor Relations page of Exelon's website: www.exeloncorp.com. Media representatives are invited to participate on a listen-only basis. The call will be archived and available for replay.
Section 9 - Financial Statements and Exhibits
Item 9.01. Financial Statements and Exhibits
(d) Exhibits.
| Exhibit No. | Description | |||||||
| 101 | Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document. | |||||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |||||||
* * * * *
This combined Current Report on Form 8-K is being furnished separately by Exelon Corporation, 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). 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.
This Current Report contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties. Words such as “could,” “may,” “expects,” “anticipates,” “will,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “predicts,” “should,” 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 the Registrants include those factors discussed herein as well as the items discussed in (1) the Registrants' 2022 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 18, Commitments and Contingencies; (2) the Registrants' Second Quarter 2023 Quarterly Report on Form 10-Q (to be filed on August 2, 2023) 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 12, Commitments and Contingencies; and (3) other factors discussed in filings with the Securities and Exchange Commission 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 Current 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 Current Report.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, each Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| EXELON CORPORATION | |||||
| /s/ Jeanne M. Jones | |||||
| Jeanne M. Jones | |||||
| Executive Vice President and Chief Financial Officer | |||||
| Exelon Corporation | |||||
| COMMONWEALTH EDISON COMPANY | |||||
| /s/ Elisabeth J. Graham | |||||
| Elisabeth J. Graham | |||||
| Senior Vice President, Chief Financial Officer and Treasurer | |||||
| Commonwealth Edison Company | |||||
| PECO ENERGY COMPANY | |||||
| /s/ Marissa Humphrey | |||||
| Marissa Humphrey | |||||
| Senior Vice President, Chief Financial Officer and Treasurer | |||||
| PECO Energy Company | |||||
| BALTIMORE GAS AND ELECTRIC COMPANY | |||||
| /s/ David M. Vahos | |||||
| David M. Vahos | |||||
| Senior Vice President, Chief Financial Officer and Treasurer | |||||
| Baltimore Gas and Electric Company | |||||
| PEPCO HOLDINGS LLC | |||||
| /s/ Phillip S. Barnett | |||||
| Phillip S. Barnett | |||||
| Senior Vice President, Chief Financial Officer and Treasurer | |||||
| Pepco Holdings LLC | |||||
| POTOMAC ELECTRIC POWER COMPANY | |||||
| /s/ Phillip S. Barnett | |||||
| Phillip S. Barnett | |||||
| Senior Vice President, Chief Financial Officer and Treasurer | |||||
| Potomac Electric Power Company | |||||
| DELMARVA POWER & LIGHT COMPANY | |||||
| /s/ Phillip S. Barnett | |||||
| Phillip S. Barnett | |||||
| Senior Vice President, Chief Financial Officer and Treasurer | |||||
| Delmarva Power & Light Company | |||||
| ATLANTIC CITY ELECTRIC COMPANY | |||||
| /s/ Phillip S. Barnett | |||||
| Phillip S. Barnett | |||||
| Senior Vice President, Chief Financial Officer and Treasurer | |||||
| Atlantic City Electric Company | |||||
August 2, 2023
EXHIBIT INDEX
| Exhibit No. | Description | |||||||
| 101 | Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document. | |||||||
| 104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | |||||||
Exhibit 99.1
News Release
| Contact: | James Gherardi Corporate Communications 312-394-7417 Andrew Plenge Investor Relations 312-394-2345 | |||||||
EXELON REPORTS SECOND QUARTER 2023 RESULTS
Earnings Release Highlights
•GAAP Net Income of $0.34 per share and Adjusted (non-GAAP) Operating Earnings of $0.41 per share for the second quarter of 2023
•Reaffirming full year 2023 Adjusted (non-GAAP) Operating Earnings guidance range of $2.30-$2.42 per share
•Reaffirming fully regulated operating EPS compounded annual growth target of 6-8% from 2021 and 2022 guidance midpoints through 2025 and 2026, respectively, with expectation to be at midpoint or better of growth range
•Strong utility reliability performance – every utility achieved top quartile in outage duration and outage frequency, and ComEd, PECO, and PHI delivered best-on-record performance for the second straight quarter
•Pepco submitted its three-year multi-year plan application with proposed 9-month extension to the Maryland Public Service Commission (MDPSC) in May seeking an increase in base rates over the period of 2024 to 2027 to support a climate ready grid and enable cleaner energy programs and technologies that support the state’s goal to reach net-zero emissions by 2045
CHICAGO (Aug. 2, 2023) — Exelon Corporation (Nasdaq: EXC) today reported its financial results for the second quarter of 2023.
“In the second quarter, we reported solid financial results, and our local energy companies across the country continue to prove that they are best in class – with three of our four operating companies having best-on-record performance in outage frequency and outage duration last quarter,” said Exelon President and CEO, Calvin Butler. “We deliver this performance while remaining steadfast in our commitment to a sustainable energy future. We are modernizing the grid, enabling further electrification and decarbonization. I’m confident we will continue strengthening Exelon’s financial position while prioritizing the health of our customers and communities.”
“Exelon’s performance remained strong into the second quarter of the year, reporting Adjusted (non-GAAP) Operating Earnings of $0.41 per share, which is in line with expectations,” said Exelon Executive Vice President and CFO Jeanne Jones. “Through the first half of 2023, we have deployed $3.6B of investments needed to lead the energy transformation for our customers. We look forward to closing out
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the second half of 2023 equally strong executing on the remaining $7.2 billion of investments. We reaffirm our full year Adjusted (non-GAAP) Operating Earnings guidance range of $2.30 to $2.42 per share.”
Second Quarter 2023
Exelon's GAAP Net Income from Continuing Operations for the second quarter of 2023 decreased to $0.34 per share from $0.47 GAAP Net Income from Continuing Operations per share in the second quarter of 2022. Adjusted (non-GAAP) Operating Earnings for the second quarter of 2023 decreased to $0.41 per share from $0.44 per share in the second quarter of 2022. For the reconciliations of GAAP Net Income from Continuing Operations to Adjusted (non-GAAP) Operating Earnings, refer to the tables beginning on page 4.
Adjusted (non-GAAP) Operating Earnings in the second quarter of 2023 primarily reflect:
•Consistent utility earnings primarily due to higher electric distribution formula rate earnings at ComEd from higher allowed ROE due to an increase in U.S. treasury rates and the impacts of higher rate base, rate increases at PECO, BGE, and PHI, and carrying costs related to the carbon mitigation credit (CMC) regulatory asset at ComEd. This was partially offset by unfavorable weather at PECO, higher depreciation expense at PECO, and higher interest expense at BGE.
•Higher costs at the Exelon holding company primarily due to higher interest expense.
Operating Company Results1
ComEd
ComEd's second quarter of 2023 GAAP Net Income increased to $249 million from $227 million in the second quarter of 2022. ComEd's Adjusted (non-GAAP) Operating Earnings for the second quarter of 2023 increased to $251 million from $229 million in the second quarter of 2022, primarily due to increases in electric distribution formula rate earnings (reflecting higher allowed ROE due to an increase in U.S. Treasury rates and the impacts of higher rate base) and carrying costs related to the CMC regulatory asset. Due to revenue decoupling, ComEd's distribution earnings are not affected by actual weather or customer usage patterns.
PECO
PECO’s second quarter of 2023 GAAP Net Income decreased to $97 million from $133 million in the second quarter of 2022. PECO's Adjusted (non-GAAP) Operating Earnings for the second quarter of 2023 decreased to $98 million from $134 million in the second quarter of 2022, primarily due to unfavorable weather and an increase in depreciation expense, partially offset by gas distribution rate increases.
BGE
BGE’s second quarter of 2023 GAAP Net Income increased to $42 million from $37 million in the second quarter of 2022. BGE's Adjusted (non-GAAP) Operating Earnings for the second quarter of 2023 increased to $43 million from $38 million in the second quarter of 2022, primarily due to favorable impacts of the multi-year plans, offset by an increase in interest expense. Due to revenue decoupling, BGE's distribution earnings are not affected by actual weather or customer usage patterns.
___________
1Exelon’s four 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; and 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.
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PHI
PHI’s second quarter of 2023 GAAP Net Income increased to $103 million from $100 million in the second quarter of 2022. PHI’s Adjusted (non-GAAP) Operating Earnings for the second quarter of 2023 increased to $115 million from $101 million in the second quarter of 2022, primarily due to distribution and transmission rate increases. Due to revenue decoupling, PHI's distribution earnings related to Pepco Maryland, DPL Maryland, Pepco District of Columbia, and ACE are not affected by actual weather or customer usage patterns.
Recent Developments and Second Quarter Highlights
•Pepco Maryland Electric Rate Case: On May 16, 2023, Pepco filed an application for a three-year cumulative multi-year plan for April 1, 2024 through March 31, 2027, with the MDPSC. Pepco requested total electric revenue requirement increases of $74 million, $60 million, and $60 million in 2024, 2025, and 2026, respectively. The plan contains a proposed nine-month extension period with a requested revenue requirement increase of $20 million effective April 1, 2027 through December 31, 2027. The electric revenue requirement increases reflect a requested ROE of 10.5%. Requested revenue requirement increases will be used to recover capital investments designed to advance system-readiness and support Maryland's climate and clean energy goals.
•Financing Activities:
◦On May 9, 2023, ComEd entered into a 364-day term loan agreement for $400 million with a variable rate equal to SOFR plus 1.00% and an expiration date of May 7, 2024. The proceeds from this loan were used to repay outstanding commercial paper obligations and for general corporate purposes.
◦On June 23, 2023, PECO issued $575 million aggregate principal amounts of its First and Refunding Mortgage Bonds, 4.90% Series due June 15, 2033. PECO used the proceeds to refinance existing indebtedness, refinance outstanding commercial paper obligations, and for general corporate purposes.
◦On May 10, 2023, BGE issued $700 million aggregate principal amount of its 5.40% notes due June 1, 2053. BGE used the proceeds to repay outstanding commercial paper obligations, repay existing indebtedness, and for general corporate purposes.
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GAAP/Adjusted (non-GAAP) Operating Earnings Reconciliation
Adjusted (non-GAAP) Operating Earnings for the second quarter of 2023 do not include the following items (after tax) that were included in reported GAAP Net Income from Continuing Operations:
| (in millions, except per share amounts) | Exelon Earnings per Diluted Share | Exelon | ComEd | PECO | BGE | PHI | ||||||||||||||
2023 GAAP Net Income from Continuing Operations | $ | 0.34 | $ | 343 | $ | 249 | $ | 97 | $ | 42 | $ | 103 | ||||||||
Mark-to-Market Impact of Economic Hedging Activities (net of taxes of $1) | — | 3 | — | — | — | — | ||||||||||||||
Change in Environmental Liabilities (net of taxes of $1) | 0.01 | 11 | — | — | — | 11 | ||||||||||||||
| SEC Matter Loss Contingency (net of taxes of $0) | 0.05 | 46 | — | — | — | — | ||||||||||||||
Separation Costs (net of taxes of $2, $1, $0, $0, and $1, respectively) | 0.01 | 5 | 2 | 1 | 1 | 1 | ||||||||||||||
2023 Adjusted (non-GAAP) Operating Earnings | $ | 0.41 | $ | 408 | $ | 251 | $ | 98 | $ | 43 | $ | 115 | ||||||||
Adjusted (non-GAAP) Operating Earnings for the second quarter of 2022 do not include the following items (after tax) that were included in reported GAAP Net Income from Continuing Operations:
| (in millions, except per share amounts) | Exelon Earnings per Diluted Share | Exelon | ComEd | PECO | BGE | PHI | ||||||||||||||
2022 GAAP Net Income from Continuing Operations | $ | 0.47 | $ | 465 | $ | 227 | $ | 133 | $ | 37 | $ | 100 | ||||||||
Separation Costs (net of taxes of $4, $1, $0, $0, and $1, respectively) | 0.01 | 10 | 2 | 1 | 1 | 2 | ||||||||||||||
| Income Tax-Related Adjustments (entire amount represents tax expense) | (0.04) | (43) | — | — | — | — | ||||||||||||||
2022 Adjusted (non-GAAP) Operating Earnings | $ | 0.44 | $ | 433 | $ | 229 | $ | 134 | $ | 38 | $ | 101 | ||||||||
Note: Amounts may not sum due to rounding.
Unless otherwise noted, the income tax impact of each reconciling item between GAAP Net Income from Continuing Operations and Adjusted (non-GAAP) Operating Earnings 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, the marginal statutory income tax rates for 2023 and 2022 ranged from 24.0% to 29.0%.
Webcast Information
Exelon will discuss second quarter 2023 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 (Nasdaq: EXC) is a Fortune 250 company and the nation’s largest utility company, serving more than 10 million customers through six fully regulated transmission and distribution utilities — Atlantic
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City Electric (ACE), Baltimore Gas and Electric (BGE), Commonwealth Edison (ComEd), Delmarva Power & Light (DPL), PECO Energy Company (PECO), and Potomac Electric Power Company (Pepco). More than 19,000 Exelon employees dedicate their time and expertise to supporting our communities through reliable, affordable and efficient energy delivery, workforce development, equity, economic development and volunteerism. 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. Exelon 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 Aug. 2, 2023.
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. Words such as “could,” “may,” “expects,” “anticipates,” “will,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “predicts,” “should,” 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, 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' 2022 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 18, Commitments and Contingencies; (2) the Registrants' Second Quarter 2023 Quarterly Report on Form 10-Q (to be filed on Aug. 2, 2023) 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.
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Financial Statements: Note 12, 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.
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Earnings Release Attachments
Table of Contents
Consolidating Statements of Operations
(unaudited)
(in millions)
| ComEd | PECO | BGE | PHI | Other (a) | Exelon | ||||||||||||||||||||||||||||||
| Three Months Ended June 30, 2023 | |||||||||||||||||||||||||||||||||||
| Operating revenues | $ | 1,901 | $ | 828 | $ | 797 | $ | 1,305 | $ | (13) | $ | 4,818 | |||||||||||||||||||||||
| Operating expenses | |||||||||||||||||||||||||||||||||||
| Purchased power and fuel | 685 | 302 | 272 | 467 | 1 | 1,727 | |||||||||||||||||||||||||||||
| Operating and maintenance | 355 | 239 | 198 | 304 | 101 | 1,197 | |||||||||||||||||||||||||||||
| Depreciation and amortization | 350 | 99 | 158 | 243 | 16 | 866 | |||||||||||||||||||||||||||||
| Taxes other than income taxes | 88 | 47 | 76 | 112 | 1 | 324 | |||||||||||||||||||||||||||||
| Total operating expenses | 1,478 | 687 | 704 | 1,126 | 119 | 4,114 | |||||||||||||||||||||||||||||
| Operating income (loss) | 423 | 141 | 93 | 179 | (132) | 704 | |||||||||||||||||||||||||||||
| Other income and (deductions) | |||||||||||||||||||||||||||||||||||
| Interest expense, net | (120) | (48) | (44) | (81) | (134) | (427) | |||||||||||||||||||||||||||||
| Other, net | 17 | 6 | 5 | 25 | 86 | 139 | |||||||||||||||||||||||||||||
| Total other income and (deductions) | (103) | (42) | (39) | (56) | (48) | (288) | |||||||||||||||||||||||||||||
| Income (loss) before income taxes | 320 | 99 | 54 | 123 | (180) | 416 | |||||||||||||||||||||||||||||
| Income taxes | 71 | 2 | 12 | 20 | (32) | 73 | |||||||||||||||||||||||||||||
| Net income (loss) | 249 | 97 | 42 | 103 | (148) | 343 | |||||||||||||||||||||||||||||
| Net income (loss) attributable to common shareholders | $ | 249 | $ | 97 | $ | 42 | $ | 103 | $ | (148) | $ | 343 | |||||||||||||||||||||||
| Three Months Ended June 30, 2022 | |||||||||||||||||||||||||||||||||||
| Operating revenues | $ | 1,425 | $ | 816 | $ | 786 | $ | 1,221 | $ | (9) | $ | 4,239 | |||||||||||||||||||||||
| Operating expenses | |||||||||||||||||||||||||||||||||||
| Purchased power and fuel | 283 | 283 | 289 | 420 | (1) | 1,274 | |||||||||||||||||||||||||||||
| Operating and maintenance | 338 | 215 | 205 | 292 | 59 | 1,109 | |||||||||||||||||||||||||||||
| Depreciation and amortization | 328 | 93 | 152 | 240 | 17 | 830 | |||||||||||||||||||||||||||||
| Taxes other than income taxes | 90 | 48 | 71 | 114 | 7 | 330 | |||||||||||||||||||||||||||||
| Total operating expenses | 1,039 | 639 | 717 | 1,066 | 82 | 3,543 | |||||||||||||||||||||||||||||
| Loss on sale of assets and businesses | (2) | — | — | — | — | (2) | |||||||||||||||||||||||||||||
| Operating income (loss) | 384 | 177 | 69 | 155 | (91) | 694 | |||||||||||||||||||||||||||||
| Other income and (deductions) | |||||||||||||||||||||||||||||||||||
| Interest expense, net | (104) | (43) | (36) | (73) | (102) | (358) | |||||||||||||||||||||||||||||
| Other, net | 13 | 8 | 5 | 19 | 130 | 175 | |||||||||||||||||||||||||||||
| Total other income and (deductions) | (91) | (35) | (31) | (54) | 28 | (183) | |||||||||||||||||||||||||||||
| Income (loss) before income taxes | 293 | 142 | 38 | 101 | (63) | 511 | |||||||||||||||||||||||||||||
| Income taxes | 66 | 9 | 1 | 1 | (31) | 46 | |||||||||||||||||||||||||||||
| Net income (loss) | 227 | 133 | 37 | 100 | (32) | 465 | |||||||||||||||||||||||||||||
| Net income (loss) attributable to common shareholders | $ | 227 | $ | 133 | $ | 37 | $ | 100 | $ | (32) | $ | 465 | |||||||||||||||||||||||
| Change in Net income from 2022 to 2023 | $ | 22 | $ | (36) | $ | 5 | $ | 3 | $ | (116) | $ | (122) | |||||||||||||||||||||||
1
Consolidating Statements of Operations
(unaudited)
(in millions)
| ComEd | PECO | BGE | PHI | Other (a) | Exelon | ||||||||||||||||||||||||||||||
| Six Months Ended June 30, 2023 | |||||||||||||||||||||||||||||||||||
| Operating revenues | $ | 3,568 | $ | 1,940 | $ | 2,053 | $ | 2,841 | $ | (22) | $ | 10,380 | |||||||||||||||||||||||
| Operating expenses | |||||||||||||||||||||||||||||||||||
| Purchased power and fuel | 1,172 | 786 | 764 | 1,094 | 2 | 3,818 | |||||||||||||||||||||||||||||
| Operating and maintenance | 692 | 510 | 419 | 613 | 113 | 2,347 | |||||||||||||||||||||||||||||
| Depreciation and amortization | 688 | 197 | 325 | 484 | 33 | 1,727 | |||||||||||||||||||||||||||||
| Taxes other than income taxes | 182 | 97 | 159 | 232 | 9 | 679 | |||||||||||||||||||||||||||||
| Total operating expenses | 2,734 | 1,590 | 1,667 | 2,423 | 157 | 8,571 | |||||||||||||||||||||||||||||
| Operating income (loss) | 834 | 350 | 386 | 418 | (179) | 1,809 | |||||||||||||||||||||||||||||
| Other income and (deductions) | |||||||||||||||||||||||||||||||||||
| Interest expense, net | (237) | (97) | (88) | (157) | (261) | (840) | |||||||||||||||||||||||||||||
| Other, net | 34 | 15 | 8 | 51 | 141 | 249 | |||||||||||||||||||||||||||||
| Total other income and (deductions) | (203) | (82) | (80) | (106) | (120) | (591) | |||||||||||||||||||||||||||||
| Income (loss) from continuing operations before income taxes | 631 | 268 | 306 | 312 | (299) | 1,218 | |||||||||||||||||||||||||||||
| Income taxes | 142 | 5 | 65 | 54 | (60) | 206 | |||||||||||||||||||||||||||||
| Net income (loss) from continuing operations after income taxes | 489 | 263 | 241 | 258 | (239) | 1,012 | |||||||||||||||||||||||||||||
| Net income from discontinued operations after income taxes | — | — | — | — | — | — | |||||||||||||||||||||||||||||
| Net income (loss) | 489 | 263 | 241 | 258 | (239) | 1,012 | |||||||||||||||||||||||||||||
| Net income attributable to noncontrolling interests | — | — | — | — | — | — | |||||||||||||||||||||||||||||
| Net income (loss) attributable to common shareholders | $ | 489 | $ | 263 | $ | 241 | $ | 258 | $ | (239) | $ | 1,012 | |||||||||||||||||||||||
| Six Months Ended June 30, 2022 | |||||||||||||||||||||||||||||||||||
| Operating revenues | $ | 3,158 | $ | 1,863 | $ | 1,940 | $ | 2,626 | $ | (21) | $ | 9,566 | |||||||||||||||||||||||
| Operating expenses | |||||||||||||||||||||||||||||||||||
| Purchased power and fuel | 921 | 689 | 743 | 999 | — | 3,352 | |||||||||||||||||||||||||||||
| Operating and maintenance | 689 | 463 | 423 | 591 | 122 | 2,288 | |||||||||||||||||||||||||||||
| Depreciation and amortization | 649 | 185 | 322 | 459 | 32 | 1,647 | |||||||||||||||||||||||||||||
| Taxes other than income taxes | 185 | 95 | 148 | 233 | 23 | 684 | |||||||||||||||||||||||||||||
| Total operating expenses | 2,444 | 1,432 | 1,636 | 2,282 | 177 | 7,971 | |||||||||||||||||||||||||||||
| Loss on sale of assets and businesses | (2) | — | — | — | — | (2) | |||||||||||||||||||||||||||||
| Operating income (loss) | 712 | 431 | 304 | 344 | (198) | 1,593 | |||||||||||||||||||||||||||||
| Other income and (deductions) | |||||||||||||||||||||||||||||||||||
| Interest expense, net | (204) | (84) | (71) | (143) | (195) | (697) | |||||||||||||||||||||||||||||
| Other, net | 26 | 16 | 11 | 37 | 223 | 313 | |||||||||||||||||||||||||||||
| Total other income and (deductions) | (178) | (68) | (60) | (106) | 28 | (384) | |||||||||||||||||||||||||||||
| Income (loss) from continuing operations before income taxes | 534 | 363 | 244 | 238 | (170) | 1,209 | |||||||||||||||||||||||||||||
| Income taxes | 119 | 24 | 10 | 8 | 102 | 263 | |||||||||||||||||||||||||||||
| Net income (loss) from continuing operations after income taxes | 415 | 339 | 234 | 230 | (272) | 946 | |||||||||||||||||||||||||||||
| Net income from discontinued operations after income taxes | — | — | — | — | 117 | 117 | |||||||||||||||||||||||||||||
| Net income (loss) | 415 | 339 | 234 | 230 | (155) | 1,063 | |||||||||||||||||||||||||||||
| Net income attributable to noncontrolling interests | — | — | — | — | 1 | 1 | |||||||||||||||||||||||||||||
| Net income (loss) attributable to common shareholders | $ | 415 | $ | 339 | $ | 234 | $ | 230 | $ | (156) | $ | 1,062 | |||||||||||||||||||||||
| Change in Net income from continuing operations 2022 to 2023 | $ | 74 | $ | (76) | $ | 7 | $ | 28 | $ | 33 | $ | 66 | |||||||||||||||||||||||
__________
(a)Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities, and other financing and investment activities.
2
Exelon
Consolidated Balance Sheets
(unaudited)
(in millions)
| June 30, 2023 | December 31, 2022 | |||||||||||||
| Assets | ||||||||||||||
| Current assets | ||||||||||||||
| Cash and cash equivalents | $ | 399 | $ | 407 | ||||||||||
| Restricted cash and cash equivalents | 435 | 566 | ||||||||||||
| Accounts receivable | ||||||||||||||
| Customer accounts receivable | 2,333 | 2,544 | ||||||||||||
| Customer allowance for credit losses | (323) | (327) | ||||||||||||
| Customer accounts receivable, net | 2,010 | 2,217 | ||||||||||||
| Other accounts receivable | 1,107 | 1,426 | ||||||||||||
| Other allowance for credit losses | (87) | (82) | ||||||||||||
| Other accounts receivable, net | 1,020 | 1,344 | ||||||||||||
| Inventories, net | ||||||||||||||
| Fossil fuel | 88 | 208 | ||||||||||||
| Materials and supplies | 622 | 547 | ||||||||||||
| Regulatory assets | 2,505 | 1,641 | ||||||||||||
| Other | 463 | 406 | ||||||||||||
| Total current assets | 7,542 | 7,336 | ||||||||||||
| Property, plant, and equipment, net | 71,300 | 69,076 | ||||||||||||
| Deferred debits and other assets | ||||||||||||||
| Regulatory assets | 7,972 | 8,037 | ||||||||||||
| Goodwill | 6,630 | 6,630 | ||||||||||||
| Receivable related to Regulatory Agreement Units | 3,120 | 2,897 | ||||||||||||
| Investments | 238 | 232 | ||||||||||||
| Other | 1,278 | 1,141 | ||||||||||||
| Total deferred debits and other assets | 19,238 | 18,937 | ||||||||||||
| Total assets | $ | 98,080 | $ | 95,349 | ||||||||||
3
| June 30, 2023 | December 31, 2022 | |||||||||||||
| Liabilities and shareholders’ equity | ||||||||||||||
| Current liabilities | ||||||||||||||
| Short-term borrowings | $ | 1,236 | $ | 2,586 | ||||||||||
| Long-term debt due within one year | 1,505 | 1,802 | ||||||||||||
| Accounts payable | 2,506 | 3,382 | ||||||||||||
| Accrued expenses | 1,220 | 1,226 | ||||||||||||
| Payables to affiliates | 5 | 5 | ||||||||||||
| Regulatory liabilities | 439 | 437 | ||||||||||||
| Mark-to-market derivative liabilities | 31 | 8 | ||||||||||||
| Unamortized energy contract liabilities | 8 | 10 | ||||||||||||
| Other | 986 | 1,155 | ||||||||||||
| Total current liabilities | 7,936 | 10,611 | ||||||||||||
| Long-term debt | 39,492 | 35,272 | ||||||||||||
| Long-term debt to financing trusts | 390 | 390 | ||||||||||||
| Deferred credits and other liabilities | ||||||||||||||
| Deferred income taxes and unamortized investment tax credits | 11,547 | 11,250 | ||||||||||||
| Regulatory liabilities | 9,406 | 9,112 | ||||||||||||
| Pension obligations | 1,061 | 1,109 | ||||||||||||
| Non-pension postretirement benefit obligations | 510 | 507 | ||||||||||||
| Asset retirement obligations | 273 | 269 | ||||||||||||
| Mark-to-market derivative liabilities | 109 | 83 | ||||||||||||
| Unamortized energy contract liabilities | 30 | 35 | ||||||||||||
| Other | 2,247 | 1,967 | ||||||||||||
| Total deferred credits and other liabilities | 25,183 | 24,332 | ||||||||||||
| Total liabilities | 73,001 | 70,605 | ||||||||||||
| Commitments and contingencies | ||||||||||||||
| Shareholders’ equity | ||||||||||||||
| Common stock | 20,941 | 20,908 | ||||||||||||
| Treasury stock, at cost | (123) | (123) | ||||||||||||
| Retained earnings | 4,891 | 4,597 | ||||||||||||
| Accumulated other comprehensive loss, net | (630) | (638) | ||||||||||||
| Total shareholders’ equity | 25,079 | 24,744 | ||||||||||||
| Total liabilities and shareholders’ equity | $ | 98,080 | $ | 95,349 | ||||||||||
4
Exelon
Consolidated Statements of Cash Flows
(unaudited)
(in millions)
| Six Months Ended June 30, | ||||||||||||||
| 2023 | 2022 | |||||||||||||
| Cash flows from operating activities | ||||||||||||||
| Net income | $ | 1,012 | $ | 1,063 | ||||||||||
| Adjustments to reconcile net income to net cash flows provided by operating activities: | ||||||||||||||
| Depreciation, amortization, and accretion, including nuclear fuel and energy contract amortization | 1,727 | 1,854 | ||||||||||||
| Gain on sales of assets and businesses | — | (8) | ||||||||||||
| Deferred income taxes and amortization of investment tax credits | 94 | 143 | ||||||||||||
| Net fair value changes related to derivatives | 4 | (59) | ||||||||||||
| Net realized and unrealized losses on NDT funds | — | 205 | ||||||||||||
| Net unrealized losses on equity investments | — | 16 | ||||||||||||
| Other non-cash operating activities | (222) | 276 | ||||||||||||
| Changes in assets and liabilities: | ||||||||||||||
| Accounts receivable | 387 | (795) | ||||||||||||
| Inventories | 44 | 12 | ||||||||||||
| Accounts payable and accrued expenses | (734) | 544 | ||||||||||||
| Option premiums paid, net | — | (39) | ||||||||||||
| Collateral (paid) received, net | (187) | 1,689 | ||||||||||||
| Income taxes | 97 | 23 | ||||||||||||
| Regulatory assets and liabilities, net | (516) | (376) | ||||||||||||
| Pension and non-pension postretirement benefit contributions | (85) | (585) | ||||||||||||
| Other assets and liabilities | 140 | (723) | ||||||||||||
| Net cash flows provided by operating activities | 1,761 | 3,240 | ||||||||||||
| Cash flows from investing activities | ||||||||||||||
| Capital expenditures | (3,685) | (3,507) | ||||||||||||
| Proceeds from NDT fund sales | — | 488 | ||||||||||||
| Investment in NDT funds | — | (516) | ||||||||||||
| Collection of DPP | — | 169 | ||||||||||||
| Proceeds from sales of assets and businesses | — | 16 | ||||||||||||
| Other investing activities | 10 | 4 | ||||||||||||
| Net cash flows used in investing activities | (3,675) | (3,346) | ||||||||||||
| Cash flows from financing activities | ||||||||||||||
| Changes in short-term borrowings | (1,600) | (597) | ||||||||||||
| Proceeds from short-term borrowings with maturities greater than 90 days | 400 | 1,150 | ||||||||||||
| Repayments on short-term borrowings with maturities greater than 90 days | (150) | (350) | ||||||||||||
| Issuance of long-term debt | 5,200 | 5,151 | ||||||||||||
| Retirement of long-term debt | (1,209) | (1,707) | ||||||||||||
| Dividends paid on common stock | (717) | (663) | ||||||||||||
| Proceeds from employee stock plans | 19 | 17 | ||||||||||||
| Transfer of cash, restricted cash, and cash equivalents to Constellation | — | (2,594) | ||||||||||||
| Other financing activities | (84) | (84) | ||||||||||||
| Net cash flows provided by financing activities | 1,859 | 323 | ||||||||||||
| (Decrease) increase in cash, restricted cash, and cash equivalents | (55) | 217 | ||||||||||||
| Cash, restricted cash, and cash equivalents at beginning of period | 1,090 | 1,619 | ||||||||||||
| Cash, restricted cash, and cash equivalents at end of period | $ | 1,035 | $ | 1,836 | ||||||||||
5
Exelon
Reconciliation of GAAP Net Income (Loss) from Continuing Operations to Adjusted (non-GAAP) Operating Earnings and Analysis of Earnings
Three Months Ended June 30, 2023 and 2022
(unaudited)
(in millions, except per share data)
| Exelon Earnings per Diluted Share | ComEd | PECO | BGE | PHI | Other (a) | Exelon | |||||||||||||||||||||||||||||||||||
| 2022 GAAP Net Income (Loss) from Continuing Operations | $ | 0.47 | $ | 227 | $ | 133 | $ | 37 | $ | 100 | $ | (32) | $ | 465 | |||||||||||||||||||||||||||
Separation Costs (net of taxes of $1, $0, $0, $1, $1, and $4, respectively) (1) | 0.01 | 2 | 1 | 1 | 2 | 4 | 10 | ||||||||||||||||||||||||||||||||||
| Income Tax-Related Adjustments (entire amount represents tax expense) (2) | (0.04) | — | — | — | — | (43) | (43) | ||||||||||||||||||||||||||||||||||
| 2022 Adjusted (non-GAAP) Operating Earnings (Loss) | $ | 0.44 | $ | 229 | $ | 134 | $ | 38 | $ | 101 | $ | (69) | $ | 433 | |||||||||||||||||||||||||||
| Year Over Year Effects on Adjusted (non-GAAP) Operating Earnings: | |||||||||||||||||||||||||||||||||||||||||
| Weather | $ | (0.03) | $ | — | (b) | $ | (27) | $ | — | (b) | $ | (4) | (b) | $ | — | $ | (31) | ||||||||||||||||||||||||
| Load | — | — | (b) | (3) | — | (b) | — | (b) | — | (3) | |||||||||||||||||||||||||||||||
| Distribution and Transmission Rates (3) | 0.04 | 14 | (c) | 9 | (c) | 13 | (c) | 7 | (c) | — | 43 | ||||||||||||||||||||||||||||||
| Other Energy Delivery (4) | 0.07 | 39 | (c) | 16 | (c) | (4) | (c) | 16 | (c) | — | 67 | ||||||||||||||||||||||||||||||
| Operating and Maintenance Expense (5) | (0.03) | (15) | (19) | 7 | 4 | (12) | (35) | ||||||||||||||||||||||||||||||||||
| Pension and Non-Pension Postretirement Benefits | — | 3 | — | (1) | (4) | (1) | (3) | ||||||||||||||||||||||||||||||||||
| Depreciation and Amortization Expense (6) | (0.03) | (15) | (5) | (2) | (2) | (1) | (25) | ||||||||||||||||||||||||||||||||||
| Interest Expense and Other (7) | (0.04) | (4) | (7) | (8) | (3) | (16) | (38) | ||||||||||||||||||||||||||||||||||
| Share Differential (8) | (0.01) | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
| Total Year Over Year Effects on Adjusted (non-GAAP) Operating Earnings | $ | (0.03) | $ | 22 | $ | (36) | $ | 5 | $ | 14 | $ | (30) | $ | (25) | |||||||||||||||||||||||||||
| 2023 GAAP Net Income (Loss) from Continuing Operations | $ | 0.34 | $ | 249 | $ | 97 | $ | 42 | $ | 103 | $ | (148) | $ | 343 | |||||||||||||||||||||||||||
Mark-to-Market Impact of Economic Hedging Activities (net of taxes of $1) | — | — | — | — | — | 3 | 3 | ||||||||||||||||||||||||||||||||||
Change in Environmental Liabilities (net of taxes of $1) | 0.01 | — | — | — | 11 | — | 11 | ||||||||||||||||||||||||||||||||||
| SEC Matter Loss Contingency (net of taxes of $0) | 0.05 | — | — | — | — | 46 | 46 | ||||||||||||||||||||||||||||||||||
Separation Costs (net of taxes of $1, $0, $0, $1, and $2, respectively) (1) | 0.01 | 2 | 1 | 1 | 1 | — | 5 | ||||||||||||||||||||||||||||||||||
| 2023 Adjusted (non-GAAP) Operating Earnings (Loss) | $ | 0.41 | $ | 251 | $ | 98 | $ | 43 | $ | 115 | $ | (99) | $ | 408 | |||||||||||||||||||||||||||
Note:
Amounts may not sum due to rounding.
Unless otherwise noted, the income tax impact of each reconciling item between GAAP Net Income from Continuing Operations and Adjusted (non-GAAP) Operating Earnings 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, the marginal statutory income tax rates for 2023 and 2022 ranged from 24.0% to 29.0%.
(a)Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities, and other financing and investment activities.
(b)For ComEd, BGE, Pepco, DPL Maryland, and ACE, customer rates are adjusted to eliminate the impacts of weather and customer usage on distribution volumes.
(c)For regulatory recovery mechanisms, including ComEd’s distribution formula rate and energy efficiency formula, ComEd, PECO, BGE, and PHI utilities transmission formula rates, and riders across all utilities, revenues increase and decrease i) as fully recoverable costs fluctuate (with no impact on net earnings), and ii) pursuant to changes in rate base, capital structure and ROE (which impact net earnings).
(1)Represents costs related to the separation primarily comprised of system-related costs, third-party costs paid to advisors, consultants, lawyers, and other experts assisting in the separation, and employee-related severance costs, which are recorded in Operating and maintenance expense.
(2)In connection with the separation, Exelon recorded a one-time impact associated with a state tax benefit.
(3)For ComEd, reflects increased electric distribution revenues due to higher allowed electric distribution ROE driven and the impacts of by an increase in treasury rates. For PECO, reflects increased revenue primarily due to distribution rate increases. For BGE, reflects increased revenue due to distribution rate increases. For PHI, reflects increased revenue primarily due to distribution and transmission rate increases.
(4)For ComEd, reflects increased electric distribution, transmission, and energy efficiency revenues due to higher fully recoverable costs and also reflects carrying costs related to the CMC regulatory assets. For PECO, reflects increased transmission and energy efficiency revenues due to regulatory required programs.
(5)Represents Operating and maintenance expense, excluding pension and non-pension postretirement benefits. For PECO, primarily reflects increased program costs related to regulatory required programs and increased contracting costs. For Corporate, primarily reflects an increase in costs for Deferred Prosecution Agreement (DPA) related matters. This increase is partially offset by a decrease in Operating and maintenance expense with an offsetting decrease in other income, for costs billed to Constellation for services provided by Exelon through the Transition Services Agreement (TSA).
(6)Reflects ongoing capital expenditures across all utilities.
(7)For Corporate, primarily reflects a decrease in other income for costs billed to Constellation for services provided by Exelon through the TSA, with an offsetting increase in Operating and maintenance expense. This was partially offset by an increase in other income for the proposed settlement of the DPA related derivative claims.
6
(8)Reflects the impact on earnings per share due to the increase in Exelon's average diluted common shares outstanding as a result of the August 2022 common stock issuance.
7
Exelon
Reconciliation of GAAP Net Income (Loss) from Continuing Operations to Adjusted (non-GAAP) Operating Earnings and Analysis of Earnings
Six Months Ended June 30, 2023 and 2022
(unaudited)
(in millions, except per share data)
| Exelon Earnings per Diluted Share | ComEd | PECO | BGE | PHI | Other (a) | Exelon | |||||||||||||||||||||||||||||||||||
| 2022 GAAP Net Income (Loss) from Continuing Operations | $ | 0.96 | $ | 415 | $ | 339 | $ | 234 | $ | 230 | $ | (272) | $ | 946 | |||||||||||||||||||||||||||
ERP System Implementation Costs (net of taxes of $0) (1) | — | — | — | — | — | 1 | 1 | ||||||||||||||||||||||||||||||||||
Separation Costs (net of taxes of $3, $1, $1, $2, $3 and $11, respectively) (2) | 0.03 | 7 | 3 | 4 | 5 | 8 | 27 | ||||||||||||||||||||||||||||||||||
| Income Tax-Related Adjustments (entire amount represents tax expense) (3) | 0.09 | — | — | — | 3 | 89 | 92 | ||||||||||||||||||||||||||||||||||
| 2022 Adjusted (non-GAAP) Operating Earnings (Loss) | $ | 1.08 | $ | 422 | $ | 342 | $ | 238 | $ | 238 | $ | (175) | $ | 1,065 | |||||||||||||||||||||||||||
Year Over Year Effects on Adjusted (non-GAAP) Operating Earnings: | |||||||||||||||||||||||||||||||||||||||||
| Weather | $ | (0.07) | $ | — | (b) | $ | (63) | $ | — | (b) | $ | (11) | (b) | $ | — | $ | (74) | ||||||||||||||||||||||||
| Load | (0.01) | — | (b) | (7) | — | (b) | (3) | (b) | — | (10) | |||||||||||||||||||||||||||||||
| Distribution and Transmission Rates (4) | 0.17 | 59 | (c) | 35 | (c) | 26 | (c) | 50 | (c) | — | 170 | ||||||||||||||||||||||||||||||
| Other Energy Delivery (5) | 0.12 | 64 | (c) | 20 | (c) | (6) | (c) | 45 | (c) | — | 123 | ||||||||||||||||||||||||||||||
| Operating and Maintenance Expense (6) | (0.02) | (13) | (39) | 2 | 15 | 10 | (25) | ||||||||||||||||||||||||||||||||||
| Pension and Non-Pension Postretirement Benefits | — | 5 | 2 | (2) | (9) | (1) | (5) | ||||||||||||||||||||||||||||||||||
| Depreciation and Amortization Expense (7) | (0.06) | (28) | (9) | (1) | (18) | (2) | (58) | ||||||||||||||||||||||||||||||||||
| Interest Expense and Other (8) | (0.08) | (8) | (17) | (15) | (19) | (23) | (82) | ||||||||||||||||||||||||||||||||||
| Share Differential (9) | (0.02) | — | — | — | — | — | — | ||||||||||||||||||||||||||||||||||
| Total Year Over Year Effects on Adjusted (non-GAAP) Operating Earnings | $ | 0.03 | $ | 79 | $ | (78) | $ | 4 | $ | 50 | $ | (16) | $ | 39 | |||||||||||||||||||||||||||
| 2023 GAAP Net Income (Loss) from Continuing Operations | $ | 1.02 | $ | 489 | $ | 263 | $ | 241 | $ | 258 | $ | (239) | $ | 1,012 | |||||||||||||||||||||||||||
Mark-to-Market Impact of Economic Hedging Activities (net of taxes of $1) | — | — | — | — | — | 2 | 2 | ||||||||||||||||||||||||||||||||||
Change in Environmental Liabilities (net of taxes of $8) | 0.03 | — | — | — | 29 | — | 29 | ||||||||||||||||||||||||||||||||||
| SEC Matter Loss Contingency (net of taxes of $0) | 0.05 | — | — | — | — | 46 | 46 | ||||||||||||||||||||||||||||||||||
Change in FERC Audit Liability (net of taxes of $4) | 0.01 | 11 | — | — | — | — | 11 | ||||||||||||||||||||||||||||||||||
Separation Costs (net of taxes of $1, $0, $0, $0, $0, and $1, respectively) (2) | — | 2 | 1 | 1 | 1 | (1) | 4 | ||||||||||||||||||||||||||||||||||
| 2023 Adjusted (non-GAAP) Operating Earnings (Loss) | $ | 1.11 | $ | 501 | $ | 264 | $ | 242 | $ | 288 | $ | (191) | $ | 1,104 | |||||||||||||||||||||||||||
Amounts may not sum due to rounding.
Unless otherwise noted, the income tax impact of each reconciling item between GAAP Net Income from Continuing Operations and Adjusted (non-GAAP) Operating Earnings 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, the marginal statutory income tax rates for 2023 and 2022 ranged from 24.0% to 29.0%.
(a)Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities, and other financing and investment activities.
(b)For ComEd, BGE, Pepco, DPL Maryland, and ACE, customer rates are adjusted to eliminate the impacts of weather and customer usage on distribution volumes.
(c)For regulatory recovery mechanisms, including ComEd’s distribution formula rate and energy efficiency formula, ComEd, PECO, BGE, and PHI utilities transmission formula rates, and riders across all utilities, revenues increase and decrease i) as fully recoverable costs fluctuate (with no impact on net earnings), and ii) pursuant to changes in rate base, capital structure and ROE (which impact net earnings).
(1)Reflects costs related to a multi-year Enterprise Resource Planning (ERP) system implementation, which are recorded in Operating and maintenance expense.
(2)Represents costs related to the separation primarily comprised of system-related costs, third-party costs paid to advisors, consultants, lawyers, and other experts assisting in the separation, and employee-related severance costs, which are recorded in Operating and maintenance expense.
(3)In connection with the separation, Exelon recorded an income tax expense primarily due to the long-term marginal state income tax rate change, the recognition of valuation allowances against the net deferred tax assets positions for certain standalone state filing jurisdictions, and nondeductible transaction costs partially offset by a one-time impact associated with a state tax benefit.
(4)For ComEd, reflects increased electric distribution revenues due to higher allowed electric distribution ROE driven by an increase in treasury rates and higher rate base. For PECO, reflects increased revenue primarily due to distribution rate increases. For BGE, reflects increased revenue due to distribution rate increases. For PHI, reflects increased revenue primarily due to distribution and transmission rate increases.
(5)For ComEd, reflects increased electric distribution, transmission, and energy efficiency revenues due to higher fully recoverable costs and also reflects carrying costs related to the CMC regulatory assets. For PECO, reflects increased transmission and energy efficiency revenues due to regulatory required programs. For PHI, includes the regulatory asset amortization of the ACE Purchase Power Agreement termination obligation recorded in the first quarter of 2022, which is fully recoverable.
(6)Represents Operating and maintenance expense, excluding pension and non-pension postretirement benefits. For PECO, primarily reflects increased program costs related to regulatory required programs and increased contracting costs. For PHI, includes decreased storm costs. For Corporate, includes the following three items: 1) an increase in costs for DPA related matters, 2) lower BSC costs that were historically allocated to Generation but are presented as part of continuing operations in Exelon’s results as these costs do not qualify as expenses of the discontinued operations per the
8
accounting rules (YTD Q2 2023 includes no costs compared to one month of costs for the period prior to the separation for YTD Q2 2022), and 3) a decrease in Operating and maintenance expense with an offsetting decrease in other income for costs billed to Constellation for services provided by Exelon through the TSA.
(7)Reflects ongoing capital expenditures across all utilities and higher depreciation rates effective January 2023 for ComEd. For BGE, also reflects decreased amortization for regulatory required programs. For PHI, includes the regulatory asset amortization of the ACE Purchase Power Agreement termination obligation recorded in the first quarter of 2022, which is fully recoverable in Other Energy Delivery.
(8)For Corporate, Other primarily reflects a decrease in other income for costs billed to Constellation for services provided by Exelon through the TSA with an offsetting decrease in Operating and maintenance expense, partially offset by an increase in other income for the proposed settlement of the DPA related derivative claims.
(9)Reflects the impact on earnings per share due to the increase in Exelon's average diluted common shares outstanding as a result of the August 2022 common stock issuance.
9
ComEd Statistics
Three Months Ended June 30, 2023 and 2022
| Electric Deliveries (in GWhs) | Revenue (in millions) | ||||||||||||||||||||||||||||||||||||||||
| 2023 | 2022 | % Change | Weather - Normal % Change | 2023 | 2022 | % Change | |||||||||||||||||||||||||||||||||||
Electric Deliveries and Revenues(a) | |||||||||||||||||||||||||||||||||||||||||
| Residential | 5,783 | 6,617 | (12.6) | % | (2.4) | % | $ | 861 | $ | 819 | 5.1 | % | |||||||||||||||||||||||||||||
| Small commercial & industrial | 6,834 | 7,198 | (5.1) | % | (3.8) | % | 461 | 312 | 47.8 | % | |||||||||||||||||||||||||||||||
| Large commercial & industrial | 6,502 | 6,641 | (2.1) | % | (1.8) | % | 205 | 11 | 1,763.6 | % | |||||||||||||||||||||||||||||||
| Public authorities & electric railroads | 185 | 186 | (0.5) | % | (0.8) | % | 13 | 5 | 160.0 | % | |||||||||||||||||||||||||||||||
Other(b) | — | — | n/a | n/a | 234 | 234 | — | % | |||||||||||||||||||||||||||||||||
Total electric revenues(c) | 19,304 | 20,642 | (6.5) | % | (2.7) | % | 1,774 | 1,381 | 28.5 | % | |||||||||||||||||||||||||||||||
Other Revenues(d) | 127 | 44 | 188.6 | % | |||||||||||||||||||||||||||||||||||||
| Total Electric Revenues | $ | 1,901 | $ | 1,425 | 33.4 | % | |||||||||||||||||||||||||||||||||||
| Purchased Power | $ | 685 | $ | 283 | 142.0 | % | |||||||||||||||||||||||||||||||||||
| % Change | |||||||||||||||||||||||||||||
| Heating and Cooling Degree-Days | 2023 | 2022 | Normal | From 2022 | From Normal | ||||||||||||||||||||||||
| Heating Degree-Days | 581 | 713 | 697 | (18.5) | % | (16.6) | % | ||||||||||||||||||||||
| Cooling Degree-Days | 298 | 377 | 266 | (21.0) | % | 12.0 | % | ||||||||||||||||||||||
Six Months Ended June 30, 2023 and 2022
| Electric Deliveries (in GWhs) | Revenue (in millions) | ||||||||||||||||||||||||||||||||||||||||
| 2023 | 2022 | % Change | Weather - Normal % Change | 2023 | 2022 | % Change | |||||||||||||||||||||||||||||||||||
Electric Deliveries and Revenues(a) | |||||||||||||||||||||||||||||||||||||||||
| Residential | 12,017 | 13,368 | (10.1) | % | (2.1) | % | $ | 1,698 | $ | 1,675 | 1.4 | % | |||||||||||||||||||||||||||||
| Small commercial & industrial | 14,032 | 14,702 | (4.6) | % | (2.3) | % | 823 | 736 | 11.8 | % | |||||||||||||||||||||||||||||||
| Large commercial & industrial | 13,061 | 13,388 | (2.4) | % | (1.2) | % | 290 | 165 | 75.8 | % | |||||||||||||||||||||||||||||||
| Public authorities & electric railroads | 412 | 443 | (7.0) | % | (5.4) | % | 22 | 20 | 10.0 | % | |||||||||||||||||||||||||||||||
Other(b) | — | — | n/a | n/a | 450 | 472 | (4.7) | % | |||||||||||||||||||||||||||||||||
Total electric revenues(c) | 39,522 | 41,901 | (5.7) | % | (1.9) | % | 3,283 | 3,068 | 7.0 | % | |||||||||||||||||||||||||||||||
Other Revenues(d) | 285 | 90 | 216.7 | % | |||||||||||||||||||||||||||||||||||||
| Total Electric Revenues | $ | 3,568 | $ | 3,158 | 13.0 | % | |||||||||||||||||||||||||||||||||||
| Purchased Power | $ | 1,172 | $ | 921 | 27.3 | % | |||||||||||||||||||||||||||||||||||
| % Change | |||||||||||||||||||||||||||||
| Heating and Cooling Degree-Days | 2023 | 2022 | Normal | From 2022 | From Normal | ||||||||||||||||||||||||
| Heating Degree-Days | 3,252 | 3,878 | 3,750 | (16.1) | % | (13.3) | % | ||||||||||||||||||||||
| Cooling Degree-Days | 298 | 377 | 266 | (21.0) | % | 12.0 | % | ||||||||||||||||||||||
| Number of Electric Customers | 2023 | 2022 | |||||||||
| Residential | 3,729,428 | 3,711,023 | |||||||||
| Small commercial & industrial | 391,380 | 390,357 | |||||||||
| Large commercial & industrial | 1,866 | 1,900 | |||||||||
| Public authorities & electric railroads | 4,791 | 4,853 | |||||||||
| Total | 4,127,465 | 4,108,133 | |||||||||
__________
(a)Reflects revenues from customers purchasing electricity directly from ComEd and customers purchasing electricity from a competitive electric generation supplier, as all customers are assessed delivery charges. For customers purchasing electricity from ComEd, revenues also reflect the cost of energy and transmission.
(b)Includes transmission revenue from PJM, wholesale electric revenue, and mutual assistance revenue.
(c)Includes operating revenues from affiliates totaling $2 million and $3 million for the three months ended June 30, 2023 and 2022, respectively, and $5 million and $8 million for the six months ended June 30, 2023 and 2022, respectively.
(d)Includes alternative revenue programs and late payment charges.
10
PECO Statistics
Three Months Ended June 30, 2023 and 2022
| Electric and Natural Gas Deliveries | Revenue (in millions) | ||||||||||||||||||||||||||||||||||||||||
| 2023 | 2022 | % Change | Weather- Normal % Change | 2023 | 2022 | % Change | |||||||||||||||||||||||||||||||||||
| Electric (in GWhs) | |||||||||||||||||||||||||||||||||||||||||
Electric Deliveries and Revenues(a) | |||||||||||||||||||||||||||||||||||||||||
| Residential | 2,694 | 3,060 | (12.0) | % | (0.1) | % | $ | 444 | $ | 431 | 3.0 | % | |||||||||||||||||||||||||||||
| Small commercial & industrial | 1,703 | 1,813 | (6.1) | % | (2.9) | % | 132 | 126 | 4.8 | % | |||||||||||||||||||||||||||||||
| Large commercial & industrial | 3,331 | 3,416 | (2.5) | % | (0.6) | % | 64 | 72 | (11.1) | % | |||||||||||||||||||||||||||||||
| Public authorities & electric railroads | 144 | 135 | 6.7 | % | 6.4 | % | 8 | 7 | 14.3 | % | |||||||||||||||||||||||||||||||
Other(b) | — | — | n/a | n/a | 71 | 68 | 4.4 | % | |||||||||||||||||||||||||||||||||
Total electric revenues(c) | 7,872 | 8,424 | (6.6) | % | (0.8) | % | 719 | 704 | 2.1 | % | |||||||||||||||||||||||||||||||
Other Revenues(d) | — | 4 | (100.0) | % | |||||||||||||||||||||||||||||||||||||
| Total Electric Revenues | 719 | 708 | 1.6 | % | |||||||||||||||||||||||||||||||||||||
| Natural Gas (in mmcfs) | |||||||||||||||||||||||||||||||||||||||||
Natural Gas Deliveries and Revenues(e) | |||||||||||||||||||||||||||||||||||||||||
| Residential | 4,373 | 5,206 | (16.0) | % | (9.8) | % | 69 | 71 | (2.8) | % | |||||||||||||||||||||||||||||||
| Small commercial & industrial | 3,743 | 3,638 | 2.9 | % | 6.8 | % | 32 | 29 | 10.3 | % | |||||||||||||||||||||||||||||||
| Large commercial & industrial | 6 | 4 | 50.0 | % | (4.0) | % | — | — | n/a | ||||||||||||||||||||||||||||||||
| Transportation | 5,190 | 5,707 | (9.1) | % | (7.0) | % | 5 | 6 | (16.7) | % | |||||||||||||||||||||||||||||||
Other(f) | — | — | n/a | n/a | 2 | 2 | — | % | |||||||||||||||||||||||||||||||||
Total natural gas revenues(g) | 13,312 | 14,555 | (8.5) | % | (4.6) | % | 108 | 108 | — | % | |||||||||||||||||||||||||||||||
Other Revenues(d) | 1 | — | 100.0 | % | |||||||||||||||||||||||||||||||||||||
| Total Natural Gas Revenues | 109 | 108 | 0.9 | % | |||||||||||||||||||||||||||||||||||||
| Total Electric and Natural Gas Revenues | $ | 828 | $ | 816 | 1.5 | % | |||||||||||||||||||||||||||||||||||
| Purchased Power and Fuel | $ | 302 | $ | 283 | 6.7 | % | |||||||||||||||||||||||||||||||||||
| % Change | |||||||||||||||||||||||||||||
| Heating and Cooling Degree-Days | 2023 | 2022 | Normal | From 2022 | From Normal | ||||||||||||||||||||||||
| Heating Degree-Days | 330 | 385 | 426 | (14.3) | % | (22.5) | % | ||||||||||||||||||||||
| Cooling Degree-Days | 233 | 434 | 386 | (46.3) | % | (39.6) | % | ||||||||||||||||||||||
11
Six Months Ended June 30, 2023 and 2022
| Electric and Natural Gas Deliveries | Revenue (in millions) | ||||||||||||||||||||||||||||||||||||||||
| 2023 | 2022 | % Change | Weather- Normal % Change | 2023 | 2022 | % Change | |||||||||||||||||||||||||||||||||||
| Electric (in GWhs) | |||||||||||||||||||||||||||||||||||||||||
Electric Deliveries and Revenues(a) | |||||||||||||||||||||||||||||||||||||||||
| Residential | 6,052 | 6,818 | (11.2) | % | (1.7) | % | $ | 963 | $ | 918 | 4.9 | % | |||||||||||||||||||||||||||||
| Small commercial & industrial | 3,546 | 3,750 | (5.4) | % | (0.5) | % | 267 | 237 | 12.7 | % | |||||||||||||||||||||||||||||||
| Large commercial & industrial | 6,568 | 6,748 | (2.7) | % | (0.2) | % | 129 | 136 | (5.1) | % | |||||||||||||||||||||||||||||||
| Public authorities & electric railroads | 312 | 317 | (1.6) | % | (1.9) | % | 16 | 15 | 6.7 | % | |||||||||||||||||||||||||||||||
Other(b) | — | — | n/a | n/a | 139 | 130 | 6.9 | % | |||||||||||||||||||||||||||||||||
Total electric revenues(c) | 16,478 | 17,633 | (6.6) | % | (0.9) | % | 1,514 | 1,436 | 5.4 | % | |||||||||||||||||||||||||||||||
Other Revenues(d) | — | 13 | (100.0) | % | |||||||||||||||||||||||||||||||||||||
| Total Electric Revenues | 1,514 | 1,449 | 4.5 | % | |||||||||||||||||||||||||||||||||||||
| Natural Gas (in mmcfs) | |||||||||||||||||||||||||||||||||||||||||
Natural Gas Deliveries and Revenues(e) | |||||||||||||||||||||||||||||||||||||||||
| Residential | 21,563 | 26,043 | (17.2) | % | (3.8) | % | 292 | 289 | 1.0 | % | |||||||||||||||||||||||||||||||
| Small commercial & industrial | 12,442 | 14,184 | (12.3) | % | (0.9) | % | 107 | 105 | 1.9 | % | |||||||||||||||||||||||||||||||
| Large commercial & industrial | 35 | 14 | 150.0 | % | 9.1 | % | 1 | — | n/a | ||||||||||||||||||||||||||||||||
| Transportation | 12,204 | 13,346 | (8.6) | % | (6.1) | % | 13 | 14 | (7.1) | % | |||||||||||||||||||||||||||||||
Other(f) | — | — | n/a | n/a | 11 | 5 | 120.0 | % | |||||||||||||||||||||||||||||||||
Total natural gas revenues(g) | 46,244 | 53,587 | (13.7) | % | (3.5) | % | 424 | 413 | 2.7 | % | |||||||||||||||||||||||||||||||
Other Revenues(d) | 2 | 1 | 100.0 | % | |||||||||||||||||||||||||||||||||||||
| Total Natural Gas Revenues | 426 | 414 | 2.9 | % | |||||||||||||||||||||||||||||||||||||
| Total Electric and Natural Gas Revenues | $ | 1,940 | $ | 1,863 | 4.1 | % | |||||||||||||||||||||||||||||||||||
| Purchased Power and Fuel | $ | 786 | $ | 689 | 14.1 | % | |||||||||||||||||||||||||||||||||||
| % Change | |||||||||||||||||||||||||||||
| Heating and Cooling Degree-Days | 2023 | 2022 | Normal | From 2022 | From Normal | ||||||||||||||||||||||||
| Heating Degree-Days | 2,218 | 2,613 | 2,843 | (15.1) | % | (22.0) | % | ||||||||||||||||||||||
| Cooling Degree-Days | 233 | 435 | 387 | (46.4) | % | (39.8) | % | ||||||||||||||||||||||
| Number of Electric Customers | 2023 | 2022 | Number of Natural Gas Customers | 2023 | 2022 | |||||||||||||||||||||
| Residential | 1,529,499 | 1,521,728 | Residential | 504,723 | 499,678 | |||||||||||||||||||||
| Small co | ||||||||||||||||||||||||||