Earnings Release Highlights
CHICAGO--(BUSINESS WIRE)-- Exelon Corporation (Nasdaq: EXC) today reported its financial results for the fourth quarter and full year 2020.
“Our financial and operational performance remained solid through year-end, with each of our utilities reporting top-quartile reliability and record customer satisfaction scores, our zero-carbon nuclear fleet achieving a near-record capacity factor and our relationships with retail customers remaining durable as we continue to be a leading provider of clean and sustainable energy solutions,” said Joseph Nigro, senior executive vice president and CFO of Exelon. “We also reached $400 million in cost savings – $150 million more than planned – and reported full-year adjusted earnings above the midpoint of our original guidance range at $3.22 per share. While we are proud of these results, looking ahead we must reckon with the impact of the devastating winter storms that overwhelmed the electric grid and disrupted millions of lives across Texas last week. Though our gas plants routinely plan and train for harsh weather, this was an unprecedented and sustained winter event that caused periodic outages and severe financial impacts. As a result of these and other conditions, we are setting our 2021 earnings guidance range at $2.60-$3.00 per share.”
Fourth Quarter 2020
Exelon's GAAP Net Income for the fourth quarter of 2020 decreased to $0.37 per share from $0.79 per share in the fourth quarter of 2019. Adjusted (non-GAAP) Operating Earnings decreased to $0.76 per share in the fourth quarter of 2020 from $0.83 per share in the fourth quarter of 2019. For the reconciliations of GAAP Net Income to Adjusted (non-GAAP) Operating Earnings, refer to the tables beginning on page 8.
Adjusted (non-GAAP) Operating Earnings in the fourth quarter of 2020 primarily reflect:
Full Year 2020
Exelon's GAAP Net Income for 2020 decreased to $2.01 per share from $3.01 per share in 2019. Exelon's Adjusted (non-GAAP) Operating Earnings for 2020 remained consistent with 2019 at $3.22 per share.
Adjusted (non-GAAP) Operating Earnings for the full year 2020 primarily reflect:
Operating Company Results1
ComEd
ComEd's fourth quarter of 2020 GAAP Net Income and (non-GAAP) Operating Earnings decreased to $134 million from $144 million in the fourth quarter of 2019, primarily due to lower allowed electric distribution ROE due to a decrease in treasury rates. Due to revenue decoupling, ComEd's distribution earnings are not affected by actual weather or customer usage patterns.
PECO
PECO’s fourth quarter of 2020 GAAP Net Income increased to $130 million from $118 million in the fourth quarter of 2019. PECO’s Adjusted (non-GAAP) Operating Earnings for the fourth quarter of 2020 increased to $133 million from $119 million in the fourth quarter of 2019, primarily due to favorable volume and an increase in tax repairs deduction, partially offset by unfavorable weather conditions.
BGE
BGE’s fourth quarter of 2020 GAAP Net Income decreased to $77 million from $99 million in the fourth quarter of 2019. BGE’s Adjusted (non-GAAP) Operating Earnings for the fourth quarter of 2020 decreased to $79 million from $101 million in the fourth quarter of 2019, primarily due to increased charitable contributions as a result of a commitment in the fourth quarter of 2020 to a multi-year small business grants program and various other activity, partially offset by regulatory rate increases. Due to revenue decoupling, BGE's distribution earnings are not affected by actual weather or customer usage patterns.
PHI
PHI’s fourth quarter of 2020 GAAP Net Income increased to $78 million from $65 million in the fourth quarter of 2019. PHI’s Adjusted (non-GAAP) Operating Earnings for the fourth quarter of 2020 increased to $81 million from $68 million in the fourth quarter of 2019, primarily due to regulatory rate increases. Due to revenue decoupling, PHI's distribution earnings related to Pepco Maryland, DPL Maryland and Pepco District of Columbia are not affected by actual weather or customer usage patterns.
Generation
Generation's fourth quarter of 2020 GAAP Net Income decreased to $19 million from $397 million in the fourth quarter of 2019. Generation’s Adjusted (non-GAAP) Operating Earnings for the fourth quarter of 2020 decreased to $391 million from $427 million in the fourth quarter of 2019, primarily due to lower realized energy prices, a reduction in load due to COVID-19, increased nuclear outage days and the absence of research and development income tax benefits recognized in the fourth quarter of 2019, partially offset by higher capacity revenues, lower operating and maintenance expense and unrealized gains resulting from equity investments that became publicly traded entities in the fourth quarter of 2020.
The proportion of expected generation hedged for the Mid-Atlantic, Midwest, New York and ERCOT reportable segments as of Dec. 31, 2020, was 94.0% to 97.0% for 2021.
____________________
1Exelon’s five business units include ComEd, which consists of electricity transmission and distribution operations in northern Illinois; PECO, which consists of electricity transmission and distribution operations and retail natural gas distribution operations in southeastern Pennsylvania; BGE, which consists of electricity transmission and distribution operations and retail natural gas distribution operations in central Maryland; PHI, which consists of electricity transmission and distribution operations in the District of Columbia and portions of Maryland, Delaware, and New Jersey and retail natural gas distribution operations in northern Delaware; and Generation, which consists of owned and contracted electric generating facilities and wholesale and retail customer supply of electric and natural gas products and services, including renewable energy products and risk management services.
Initiates Annual Guidance for 2021
Exelon introduced a guidance range for 2021 Adjusted (non-GAAP) Operating Earnings of $2.60-$3.00 per share. The outlook for 2021 Adjusted (non-GAAP) Operating Earnings for Exelon and its subsidiaries excludes the following items:
Recent Developments and Fourth Quarter Highlights
GAAP/Adjusted (non-GAAP) Operating Earnings Reconciliations
Adjusted (non-GAAP) Operating Earnings for the fourth quarter of 2020 do not include the following items (after tax) that were included in reported GAAP Net Income:
(in millions) | Exelon Earnings per Diluted Share | Exelon | ComEd | PECO | BGE | PHI | Generation | |||||||||||||||||
2020 GAAP Net Income (Loss) | $ | 0.37 |
| $ | 360 |
| $ | 134 | $ | 130 | $ | 77 | $ | 78 | $ | 19 |
| |||||||
Mark-to-Market Impact of Economic Hedging Activities (net of taxes of $39 and $38, respectively) | 0.12 |
| 116 |
| — | — | — | — | 115 |
| ||||||||||||||
Unrealized Gains Related to Nuclear Decommissioning Trust (NDT) Funds (net of taxes of $248) | (0.27 | ) | (264 | ) | — | — | — | — | (264 | ) | ||||||||||||||
Plant Retirements and Divestitures (net of taxes of $127) | 0.38 |
| 370 |
| — | — | — | — | 370 |
| ||||||||||||||
Cost Management Program (net of taxes of $3, $0, $1, and $2, respectively) | 0.01 |
| 10 |
| — | 1 | — | 2 | 7 |
| ||||||||||||||
COVID-19 Direct Costs (net of taxes of $4, $1, $0, $0, and $3, respectively) | 0.01 |
| 14 |
| — | 2 | 1 | 1 | 10 |
| ||||||||||||||
Asset Retirement Obligation (net of taxes of $15) | 0.05 |
| 45 |
| — | — | — | — | 45 |
| ||||||||||||||
Acquisition Related Costs (net of taxes of $1) | — |
| 2 |
| — | — | — | — | 2 |
| ||||||||||||||
ERP System Implementation Costs (net of taxes of $1, $0, and $1, respectively) | — |
| 3 |
| — | — | 1 | — | 2 |
| ||||||||||||||
Income Tax-Related Adjustments (entire amount represents tax expense) | 0.01 |
| 5 |
| — | — | — | — | — |
| ||||||||||||||
Noncontrolling Interests (net of taxes of $17) | 0.09 |
| 85 |
| — | — | — | — | 85 |
| ||||||||||||||
2020 Adjusted (non-GAAP) Operating Earnings | $ | 0.76 |
| $ | 746 |
| $ | 134 | $ | 133 | $ | 79 | $ | 81 | $ | 391 |
|
Adjusted (non-GAAP) Operating Earnings for the fourth quarter of 2019 do not include the following items (after tax) that were included in reported GAAP Net Income:
(in millions) | Exelon Earnings per Diluted Share | Exelon | ComEd | PECO | BGE | PHI | Generation | |||||||||||||||||
2019 GAAP Net Income | $ | 0.79 |
| $ | 773 |
| $ | 144 | $ | 118 | $ | 99 | $ | 65 | $ | 397 |
| |||||||
Mark-to-Market Impact of Economic Hedging Activities (net of taxes of $35 and $32, respectively) | 0.10 |
| 101 |
| — | — | — | — | 95 |
| ||||||||||||||
Unrealized Gains Related to NDT Funds (net of taxes of $102) | (0.12 | ) | (119 | ) | — | — | — | — | (119 | ) | ||||||||||||||
Asset Impairments (net of taxes of $1) | — |
| 4 |
| — | — | — | — | 4 |
| ||||||||||||||
Plant Retirements and Divestitures (net of taxes of $1) | — |
| 3 |
| — | — | — | — | 3 |
| ||||||||||||||
Cost Management Program (net of taxes of $6, $0, $0, $1, and $4, respectively) | 0.02 |
| 21 |
| — | 1 | 2 | 3 | 13 |
| ||||||||||||||
Change in Environmental Liabilities (net of taxes of $1) | — |
| 4 |
| — | — | — | — | 4 |
| ||||||||||||||
Income Tax-Related Adjustments (entire amount represents tax expense) | (0.01 | ) | (8 | ) | — | — | — | — | (2 | ) | ||||||||||||||
Noncontrolling Interests (net of taxes of $8) | 0.03 |
| 33 |
| — | — | — | — | 33 |
| ||||||||||||||
2019 Adjusted (non-GAAP) Operating Earnings | $ | 0.83 |
| $ | 810 |
| $ | 144 | $ | 119 | $ | 101 | $ | 68 | $ | 427 |
|
Adjusted (non-GAAP) Operating Earnings for the full year 2020 do not include the following items (after tax) that were included in reported GAAP Net Income:
(in millions) | Exelon Earnings per Diluted Share | Exelon | ComEd | PECO | BGE | PHI | Generation | ||||||||||||||||||
2020 GAAP Net Income | $ | 2.01 |
| $ | 1,963 |
| $ | 438 | $ | 447 | $ | 349 | $ | 495 |
| $ | 589 |
| |||||||
Mark-to-Market Impact of Economic Hedging Activities (net of taxes of $73 and $79, respectively) | (0.22 | ) | (213 | ) | — | — | — | — |
| (234 | ) | ||||||||||||||
Unrealized Gains Related to NDT Funds (net of taxes of $278) | (0.26 | ) | (256 | ) | — | — | — | — |
| (256 | ) | ||||||||||||||
Asset Impairments (net of taxes of $135, $4, and $130, respectively) | 0.41 |
| 396 |
| 11 | — | — | — |
| 385 |
| ||||||||||||||
Plant Retirements and Divestitures (net of taxes of $244) | 0.74 |
| 718 |
| — | — | — | — |
| 718 |
| ||||||||||||||
Cost Management Program (net of taxes of $14, $1, $1, $3, and $10, respectively) | 0.05 |
| 45 |
| — | 4 | 4 | 8 |
| 31 |
| ||||||||||||||
Change in Environmental Liabilities (net of taxes of $6) | 0.02 |
| 18 |
| — | — | — | — |
| 18 |
| ||||||||||||||
COVID-19 Direct Costs (net of taxes of $19, $4, $2, $2, and $11, respectively) | 0.05 |
| 50 |
| — | 9 | 4 | 4 |
| 33 |
| ||||||||||||||
Deferred Prosecution Agreement Payments (net of taxes of $0) | 0.20 |
| 200 |
| 200 | — | — | — |
| — |
| ||||||||||||||
Asset Retirement Obligation (net of taxes of $16, $1, and $15, respectively) | 0.05 |
| 48 |
| — | — | — | 3 |
| 45 |
| ||||||||||||||
Acquisition Related Costs (net of taxes of $1) | — |
| 4 |
| — | — | — | — |
| 4 |
| ||||||||||||||
ERP System Implementation Costs (net of taxes of $1, $0, and $1, respectively) | — |
| 3 |
| — | — | 1 | — |
| 2 |
| ||||||||||||||
Income Tax-Related Adjustments (entire amount represents tax expense) | 0.07 |
| 71 |
| — | — | — | (1 | ) | (28 | ) | ||||||||||||||
Noncontrolling Interests (net of taxes of $19) | 0.11 |
| 103 |
| — | — | — | — |
| 103 |
| ||||||||||||||
2020 Adjusted (non-GAAP) Operating Earnings | $ | 3.22 |
| $ | 3,149 |
| $ | 648 | $ | 460 | $ | 358 | $ | 509 |
| $ | 1,410 |
|
Adjusted (non-GAAP) Operating Earnings for the full year 2019 do not include the following items (after tax) that were included in reported GAAP Net Income:
(in millions) | Exelon Earnings per Diluted Share | Exelon | ComEd | PECO | BGE | PHI | Generation | |||||||||||||||||
2019 GAAP Net Income | $ | 3.01 |
| $ | 2,936 |
| $ | 688 | $ | 528 | $ | 360 | $ | 477 | $ | 1,125 |
| |||||||
Mark-to-Market Impact of Economic Hedging Activities (net of taxes of $66 and $58, respectively) | 0.20 |
| 197 |
| — | — | — | — | 175 |
| ||||||||||||||
Unrealized Gains Related to NDT Funds (net of taxes of $269) | (0.31 | ) | (299 | ) | — | — | — | — | (299 | ) | ||||||||||||||
Asset Impairments (net of taxes of $56) | 0.13 |
| 123 |
| — | — | — | — | 123 |
| ||||||||||||||
Plant Retirements and Divestitures (net of taxes of $9) | 0.12 |
| 118 |
| — | — | — | — | 118 |
| ||||||||||||||
Cost Management Program (net of taxes of $17, $1, $1, $3, and $11, respectively) | 0.05 |
| 51 |
| — | 3 | 4 | 7 | 35 |
| ||||||||||||||
Litigation Settlement Gain (net of taxes of $7) | (0.02 | ) | (19 | ) | — | — | — | — | (19 | ) | ||||||||||||||
Asset Retirement Obligation (net of taxes of $9) | (0.09 | ) | (84 | ) | — | — | — | — | (84 | ) | ||||||||||||||
Change in Environmental Liabilities (net of taxes of $8, $6, and $2, respectively) | 0.02 |
| 20 |
| — | — | — | 16 | 4 |
| ||||||||||||||
Income Tax-Related Adjustments (entire amount represents tax expense) | 0.01 |
| 5 |
| — | — | — | 2 | 6 |
| ||||||||||||||
Noncontrolling Interests (net of taxes of $26) | 0.09 |
| 90 |
| — | — | — | — | 90 |
| ||||||||||||||
2019 Adjusted (non-GAAP) Operating Earnings | $ | 3.22 |
| $ | 3,139 |
| $ | 688 | $ | 531 | $ | 364 | $ | 502 | $ | 1,276 |
|
Note: Amounts may not sum due to rounding. Unless otherwise noted, the income tax impact of each reconciling item between GAAP Net Income 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 except the unrealized gains and losses related to NDT funds, the marginal statutory income tax rates for 2020 and 2019 ranged from 26.0% to 29.0%. Under IRS regulations, NDT fund returns are taxed at different rates for investments if they are in qualified or non-qualified funds. The effective tax rates for the unrealized gains and losses related to NDT funds were 48.4% and 46.1% for the three months ended Dec. 31, 2020 and 2019, respectively; and were 52.1% and 47.3% for the twelve months ended Dec. 31, 2020 and 2019, respectively.
Webcast Information
Exelon will discuss fourth quarter 2020 earnings in conference call scheduled for today at 9 a.m. Central Time (10 a.m. Eastern Time). The webcast and associated materials can be accessed at www.exeloncorp.com/investor-relations.
About Exelon
Exelon Corporation (Nasdaq: EXC) is a Fortune 100 energy company with the largest number of electricity and natural gas customers in the U.S. Exelon does business in 48 states, the District of Columbia and Canada and had 2020 revenue of $33 billion. Exelon serves approximately 10 million customers in Delaware, the District of Columbia, Illinois, Maryland, New Jersey and Pennsylvania through its Atlantic City Electric, BGE, ComEd, Delmarva Power, PECO and Pepco subsidiaries. Exelon is one of the largest competitive U.S. power generators, with more than 31,000 megawatts of nuclear, gas, wind, solar and hydroelectric generating capacity comprising one of the nation’s cleanest and lowest-cost power generation fleets. The company’s Constellation business unit provides energy products and services to approximately 2 million residential, public sector and business customers, including three fourths of the Fortune 100. Follow Exelon on Twitter @Exelon.
Non-GAAP Financial Measures
In addition to net income as determined under generally accepted accounting principles in the United States (GAAP), Exelon evaluates its operating performance using the measure of Adjusted (non-GAAP) Operating Earnings because management believes it represents earnings directly related to the ongoing operations of the business. Adjusted (non-GAAP) Operating Earnings exclude certain costs, expenses, gains and losses and other specified items. This measure is intended to enhance an investor’s overall understanding of period over period operating results and provide an indication of Exelon’s baseline operating performance excluding items that are considered by management to be not directly related to the ongoing operations of the business. In addition, this measure is among the primary indicators management uses as a basis for evaluating performance, allocating resources, setting incentive compensation targets and planning and forecasting of future periods. Adjusted (non-GAAP) Operating Earnings is not a presentation defined under GAAP and may not be comparable to other companies’ presentation. 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 Feb. 24, 2021.
Cautionary Statements Regarding Forward-Looking Information
This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks and uncertainties including, among others, those related to the timing, manner, tax-free nature and expected benefits associated with the potential separation of Exelon’s competitive power generation and customer-facing energy business from its six regulated electric and gas utilities. Words such as “could,” “may,” “expects,” “anticipates,” “will,” “targets,” “goals,” “projects,” “intends,” “plans,” “believes,” “seeks,” “estimates,” “predicts,” and variations on such words, and similar expressions that reflect our current views with respect to future events and operational, economic, and financial performance, are intended to identify such forward-looking statements.
The factors that could cause actual results to differ materially from the forward-looking statements made by Exelon Corporation, Exelon Generation Company, LLC, Commonwealth Edison Company, PECO Energy Company, Baltimore Gas and Electric Company, Pepco Holdings LLC, Potomac Electric Power Company, Delmarva Power & Light Company, and Atlantic City Electric Company (Registrants) include those factors discussed herein, as well as the items discussed in (1) the Registrants' 2019 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' Third Quarter 2020 Quarterly Report on Form 10-Q in (a) Part II, ITEM 1A. Risk Factors, (b) Part I, ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations, and (c) Part I, ITEM 1. Financial Statements: Note 14, Commitments and Contingencies; and (3) other factors discussed in filings with the SEC by the Registrants.
Investors are cautioned not to place undue reliance on these forward-looking statements, whether written or oral, which apply only as of the date of this press release. None of the Registrants undertakes any obligation to publicly release any revision to its forward-looking statements to reflect events or circumstances after the date of this press release.
Exelon | ||||||||||||||||||||
GAAP Consolidated Statements of Operations and | ||||||||||||||||||||
Adjusted (non-GAAP) Operating Earnings Reconciling Adjustments | ||||||||||||||||||||
(unaudited) | ||||||||||||||||||||
(in millions, except per share data) | ||||||||||||||||||||
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| Three Months Ended December 31, 2020 |
|
|
| Three Months Ended December 31, 2019 |
|
| ||||||||||||
|
| GAAP (a) |
| Non-GAAP Adjustments |
|
|
| GAAP (a) |
| Non-GAAP Adjustments |
|
| ||||||||
Operating revenues |
| $ | 8,117 |
|
| $ | 128 |
|
| (c) |
| $ | 8,343 |
|
| $ | 67 |
|
| (c) |
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Purchased power and fuel |
| 3,698 |
|
| (99 | ) |
| (c),(d) |
| 3,766 |
|
| (64 | ) |
| (c) | ||||
Operating and maintenance |
| 2,039 |
|
| 120 |
|
| (d),(e),(f),(g), (h),(i) |
| 2,196 |
|
| (32 | ) |
| (d),(e),(m),(n) | ||||
Depreciation and amortization |
| 1,702 |
|
| (663 | ) |
| (d) |
| 1,015 |
|
| (20 | ) |
| (d) | ||||
Taxes other than income taxes |
| 414 |
|
| — |
|
|
|
| 417 |
|
| — |
|
|
| ||||
Total operating expenses |
| 7,853 |
|
|
|
|
|
| 7,394 |
|
|
|
|
| ||||||
Gain on sales of assets and businesses |
| 8 |
|
| 1 |
|
| (d) |
| 11 |
|
| (11 | ) |
| (d) | ||||
Operating income |
| 272 |
|
|
|
|
|
| 960 |
|
|
|
|
| ||||||
Other income and (deductions) |
|
|
|
|
|
|
|
|
|
|
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| ||||||||
Interest expense, net |
| (395 | ) |
| (22 | ) |
| (c) |
| (395 | ) |
| (5 | ) |
| (c) | ||||
Other, net |
| 792 |
|
| (511 | ) |
| (j) |
| 391 |
|
| (221 | ) |
| (j) | ||||
Total other income and (deductions) |
| 397 |
|
|
|
|
|
| (4 | ) |
|
|
|
| ||||||
Income (loss) before income taxes |
| 669 |
|
|
|
|
|
| 956 |
|
|
|
|
| ||||||
Income taxes |
| 232 |
|
| (62 | ) |
| (c),(d),(e),(f), (g),(h),(i),(j), (k) |
| 147 |
|
| (61 | ) |
| (c),(e),(j),(l), (m),(n) | ||||
Equity in losses of unconsolidated affiliates |
| (1 | ) |
| — |
|
|
|
| (1 | ) |
| — |
|
|
| ||||
Net income |
| 436 |
|
|
|
|
|
| 808 |
|
|
|
|
| ||||||
Net income (loss) attributable to noncontrolling interests |
| 76 |
|
| (86 | ) |
| (o) |
| 35 |
|
| (33 | ) |
| (o) | ||||
Net income attributable to common shareholders |
| $ | 360 |
|
|
|
|
|
| $ | 773 |
|
|
|
|
| ||||
Effective tax rate(b) |
| 34.7 | % |
|
|
|
|
| 15.4 | % |
|
|
|
| ||||||
Earnings per average common share |
|
|
|
|
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|
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| ||||||||
Basic |
| $ | 0.37 |
|
|
|
|
|
| $ | 0.79 |
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|
|
|
| ||||
Diluted |
| $ | 0.37 |
|
|
|
|
|
| $ | 0.79 |
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| ||||
Average common shares outstanding |
|
|
|
|
|
|
|
|
|
|
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| ||||||||
Basic |
| 977 |
|
|
|
|
|
| 974 |
|
|
|
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| ||||||
Diluted |
| 978 |
|
|
|
|
|
| 975 |
|
|
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__________ | ||
(a) | Results reported in accordance with accounting principles generally accepted in the United States (GAAP). | |
(b) | The effective tax rate related to Adjusted (non-GAAP) Operating Earnings is 18.7% and 9.5% for the three months ended December 31, 2020 and 2019, respectively. | |
(c) | Adjustment to exclude the mark-to-market impact of Exelon's economic hedging activities, net of intercompany eliminations. | |
(d) | In 2020, adjustment to exclude primarily accelerated depreciation and amortization associated with Generation's decisions in the third quarter of 2020 to early retire Byron and Dresden nuclear facilities in 2021 and Mystic Units 8 and 9 in 2024. In 2019, adjustment to exclude costs related to plant retirements and divestitures. | |
(e) | Adjustment to exclude reorganization and severance costs related to cost management programs. | |
(f) | Adjustment to exclude direct costs related to COVID-19 consisting primarily of costs to acquire personal protective equipment, costs for cleaning supplies and services, and costs to hire healthcare professionals to monitor the health of employees. | |
(g) | Adjustment to exclude an adjustment to Generation's nuclear asset retirement obligation for Non-Regulatory Agreement Units resulting from the annual update. | |
(h) | Adjustment to exclude costs related to the acquisition of Electricite de France SA's (EDF's) interest in CENG. | |
(i) | Adjustment to exclude costs related to a multi-year Enterprise Resource Program (ERP) system implementation. | |
(j) | Adjustment to exclude the impact of net unrealized gains on Generation’s NDT fund investments for Non-Regulatory and Regulatory Agreement Units. The impacts of the Regulatory Agreement Units, including the associated income taxes, are contractually eliminated, resulting in no earnings impact. | |
(k) | Adjustment to exclude income-tax related adjustments. | |
(l) | Adjustment to exclude the adjustment to deferred income taxes due to changes in the forecasted apportionment. | |
(m) | Adjustment to exclude a change in environmental liabilities. | |
(n) | Adjustment to exclude asset impairments. | |
(o) | Adjustment to exclude the elimination from Generation’s results of the noncontrolling interests related to certain exclusion items, primarily related to unrealized gains and losses on NDT fund investments for CENG units. |
Exelon | ||||||||||||||||||||
GAAP Consolidated Statements of Operations and | ||||||||||||||||||||
Adjusted (non-GAAP) Operating Earnings Reconciling Adjustments | ||||||||||||||||||||
(unaudited) | ||||||||||||||||||||
(in millions, except per share data) | ||||||||||||||||||||
|
| Twelve Months Ended December 31, 2020 |
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|
| Twelve Months Ended December 31, 2019 |
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| ||||||||||||
|
| GAAP (a) |
| Non-GAAP Adjustments |
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|
| GAAP (a) |
| Non-GAAP Adjustments |
|
| ||||||||
Operating revenues |
| $ | 33,039 |
|
| $ | (110 | ) |
| (c) |
| $ | 34,438 |
|
| $ | 3 |
|
| (c) |
Operating expenses |
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Purchased power and fuel |
| 14,104 |
|
| 111 |
|
| (c),(d) |
| 15,497 |
|
| (224 | ) |
| (c),(d) | ||||
Operating and maintenance |
| 9,408 |
|
| (904 | ) |
| (d),(e),(f),(g), (h),(i),(j),(k),(l) |
| 8,615 |
|
| 37 |
|
| (d),(e),(f),(g), (j),(o) | ||||
Depreciation and amortization |
| 5,014 |
|
| (939 | ) |
| (d) |
| 4,252 |
|
| (314 | ) |
| (d) | ||||
Taxes other than income taxes |
| 1,714 |
|
| (1 | ) |
| (d),(f) |
| 1,732 |
|
| — |
|
|
| ||||
Total operating expenses |
| 30,240 |
|
|
|
|
|
| 30,096 |
|
|
|
|
| ||||||
Gain on sales of assets and businesses |
| 24 |
|
| (3 | ) |
| (c),(d) |
| 31 |
|
| (27 | ) |
| (d) | ||||
Gain on deconsolidation of business |
| — |
|
| — |
|
|
|
| 1 |
|
| — |
|
|
| ||||
Operating income |
| 2,823 |
|
|
|
|
|
| 4,374 |
|
|
|
|
| ||||||
Other income and (deductions) |
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Interest expense, net |
| (1,635 | ) |
| 26 |
|
| (c),(m) |
| (1,616 | ) |
| 38 |
|
| (c) | ||||
Other, net |
| 1,145 |
|
| (534 | ) |
| (n) |
| 1,227 |
|
| (722 | ) |
| (c),(d),(n) | ||||
Total other income and (deductions) |
| (490 | ) |
|
|
|
|
| (389 | ) |
|
|
|
| ||||||
Income before income taxes |
| 2,333 |
|
|
|
|
|
| 3,985 |
|
|
|
|
| ||||||
Income taxes |
| 373 |
|
| 26 |
|
| (c),(d),(e),(f), (g),(h),(j),(k), (l),(m),(n) |
| 774 |
|
| (156 | ) |
| (c),(d),(e),(f), (g),(j),(m),(n), (o) | ||||
Equity in losses of unconsolidated affiliates |
| (6 | ) |
| — |
|
|
|
| (183 | ) |
| 164 |
|
| (e) | ||||
Net income |
| 1,954 |
|
|
|
|
|
| 3,028 |
|
|
|
|
| ||||||
Net income attributable to noncontrolling interests |
| (9 | ) |
| (101 | ) |
| (p) |
| 92 |
|
| (91 | ) |
| (p) | ||||
Net income attributable to common shareholders |
| $ | 1,963 |
|
|
|
|
|
| $ | 2,936 |
|
|
|
|
| ||||
Effective tax rate(b) |
| 16.0 | % |
|
|
|
|
| 19.4 | % |
|
|
|
| ||||||
Earnings per average common share |
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Basic |
| $ | 2.01 |
|
|
|
|
|
| $ | 3.02 |
|
|
|
|
| ||||
Diluted |
| $ | 2.01 |
|
|
|
|
|
| $ | 3.01 |
|
|
|
|
| ||||
Average common shares outstanding |
|
|
|
|
|
|
|
|
|
|
|
| ||||||||
Basic |
| 976 |
|
|
|
|
|
| 973 |
|
|
|
|
| ||||||
Diluted |
| 977 |
|
|
|
|
|
| 974 |
|
|
|
|
|
__________ | ||
(a) | Results reported in accordance with accounting principles generally accepted in the United States (GAAP). | |
(b) | The effective tax rate related to Adjusted (non-GAAP) Operating Earnings is 11.6% and 16.4% for the twelve months ended December 31, 2020 and 2019, respectively. | |
(c) | Adjustment to exclude the mark-to-market impact of Exelon's economic hedging activities, net of intercompany eliminations. | |
(d) | In 2020, adjustment to exclude one-time charges and accelerated depreciation and amortization associated with Generation's decisions in the third quarter of 2020 to early retire Byron and Dresden nuclear facilities in 2021 and Mystic Units 8 and 9 in 2024. In 2019, adjustment to exclude accelerated depreciation and amortization expenses associated with the early retirement of the TMI nuclear facility and certain fossil sites and the loss on the sale of Oyster Creek to Holtec, partially offset by net realized gains related to Oyster Creek's NDT fund investments, a net benefit associated with remeasurements of the TMI ARO, and a gain on the sale of certain wind assets. | |
(e) | In 2020, adjustment to exclude an impairment at ComEd in the second quarter of 2020 related to the acquisition of transmission assets and an impairment of the New England asset group in the third quarter of 2020. In 2019, adjustment to exclude the impairment of equity method investments in certain distributed energy companies. | |
(f) | Adjustment to exclude reorganization and severance costs related to cost management programs. | |
(g) | Adjustment to exclude a change in environmental liabilities. | |
(h) | Adjustment to exclude direct costs related to COVID-19 consisting primarily of costs to acquire personal protective equipment, costs for cleaning supplies and services, and costs to hire healthcare professionals to monitor the health of employees. | |
(i) | Adjustment to exclude the payments made by ComEd under the Deferred Prosecution Agreement, which ComEd entered into on July 17, 2020 with the U.S. Attorney’s Office for the Northern District of Illinois. | |
(j) | Adjustment to exclude an adjustment to Generation's nuclear asset retirement obligation for Non-Regulatory Agreement Units resulting from the annual update. | |
(k) | Adjustment to exclude costs related to the acquisition of Electricite de France SA's (EDF's) interest in CENG. | |
(l) | Adjustment to exclude costs related to a multi-year Enterprise Resource Program (ERP) system implementation. | |
(m) | Adjustment to exclude the adjustment to deferred income taxes due to changes in forecasted apportionment. | |
(n) | Adjustment to exclude the impact of net unrealized gains on Generation’s NDT fund investments for Non-Regulatory and Regulatory Agreement Units. The impacts of the Regulatory Agreement Units, including the associated income taxes, are contractually eliminated, resulting in no earnings impact. | |
(o) | Adjustment to exclude a gain related to a litigation settlement. | |
(p) | Adjustment to exclude from Generation’s results of the noncontrolling interests related to certain exclusion items. In 2020, primarily related to unrealized gains and losses on NDT fund investments for CENG units. In 2019, primarily related to the impact of unrealized gains on NDT fund investments and the impact of the Generation's annual nuclear ARO update for CENG units, partially offset by the impairment of certain equity investments in distributed energy companies. |
View source version on businesswire.com: https://www.businesswire.com/news/home/20210224005283/en/
Paul Adams Corporate Communications 410-245-8717
Emily Duncan Investor Relations 312-394-2345
Source: Exelon Corporation