UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
July 24, 2001
(Date of earliest
event reported)
EXELON CORPORATION
(Exact name of registrant as specified in its charter)
Pennsylvania 1-16169 23-2990190
(State or other (SEC (IRS Employer
jurisdiction of file number) Identification
incorporation) Number)
37th Floor, 10 South Dearborn Street
Post Office Box A-3005
Chicago, Illinois 60690-3005
(Address of principal executive offices)
Registrant's telephone number, including area code:
(312) 394-4321
Item 5. Other Events
On July 24, 2001, Exelon Corporation issued the following press release.
Exelon Reports Strong Second Quarter Earnings of $0.97 Per Diluted Share
Chicago (July 24, 2001) Exelon Corporation today announced operating and
reported earnings of $315 million or $0.97 per diluted share for the second
quarter of 2001, representing a 17% increase over pro forma diluted operating
earnings for the comparable period in 2000. Exelon operating earnings for the
second quarter of 2000 were $125 million or $0.71 per diluted share, which
represent the results of PECO Energy and do not reflect the effects of the
October 20, 2000 merger with Unicom Corporation. On a pro forma basis assuming
the merger of PECO Energy and Unicom Corporation occurred on January 1, 2000,
second quarter 2000 earnings were $0.83 per diluted share.
Highlights for the quarter include:
o Energy sales of 48,522 GWh's which were 31% higher than pro forma second
quarter 2000. Wholesale market sales accounted for 42% of total sales.
o Strong performance by Power Team, Exelon Generation's wholesale marketing
division, in April and May which was partially offset by the effects of
cool weather across most of the United States and a decline in wholesale
power prices in June.
o The addition of 800 megawatts of long-term contracts to the Power Team
supply portfolio.
o Continuing superior performance by Exelon Generation's nuclear operations:
o a 93.6% nuclear capacity factor
o two record-breaking refueling outages
o the addition of 129 megawatts of capacity through power uprate
projects at Byron and Braidwood
o Exelon Generation's fossil operations continue their strong performance
with:
o 97% on time delivery
o 94% dispatch availability
o ComEd's on time completion of over 450 projects which formed the foundation
of its rigorous 2001 summer preparedness and infrastructure improvement
program.
Corbin A. McNeill, Co-CEO and Chairman, said, "The quarter confirmed, yet again,
Exelon's ability to meet its commitments. Despite cool weather and the fall in
wholesale prices in June, we've produced earnings that surpassed market
expectations. And we did it as we've done it in the past: through superior
execution."
John W. Rowe, Co-CEO and President, said, "I am delighted that our generation
group, Power Team, PECO and ComEd delivery operations all contributed to these
excellent results. While we expect larger challenges in the wholesale power
markets and in our Enterprise group during the second half, the combined
strength of our generation, power marketing and energy delivery groups put us in
a strong position to meet our commitments for the year."
Ruth Ann Gillis, Senior Vice President and Chief Financial Officer, confirmed
the company's previous earnings guidance. She noted, "We have had two good
quarters and we continue to believe our integrated strategy positions us to meet
our commitment of $4.50 earnings per share for 2001."
CORPORATE ISSUES
Second quarter earnings reflect goodwill amortization of $0.11 per share.
Consistent with FASB's new accounting standard for goodwill, Exelon expects to
discontinue annual amortization of approximately $140 million of goodwill,
effective January 1, 2002.
Merger-related synergies continue to be realized and Exelon expects to achieve
its target of $148 million this year.
BUSINESS UNIT RESULTS
Performance for Exelon's business segments--Energy Delivery, Generation and
Enterprises--is reported on the basis of earnings before interest and income
taxes (EBIT). Exelon's EBIT increased 20% to $821 million in the quarter
compared to pro forma EBIT of $685 million in the second quarter of 2000.
Energy Delivery consists of the retail electricity transmission and distribution
operations of ComEd and PECO Energy and the natural gas distribution business of
PECO Energy. Energy Delivery's operating revenues were $2,436 million for the
current quarter compared to pro forma revenues of $2,271 million in 2000.
Operating revenues reflect retail kilowatt-hour sales of 28,749 GWh's, which
were essentially flat compared to the prior-year sales of 28,764 GWh's due to
moderate weather conditions and the impact of a slower economy. Energy
Delivery's EBIT of $706 million in the second quarter of 2001 increased 10% over
the prior-year period pro forma EBIT of $643 million. ComEd's EBIT increased $73
million primarily as a result of lower operating and maintenance expenses
compared to the prior year period. PECO Energy's EBIT declined by $10 million
compared to the prior-year period pro forma EBIT due to an increase in
Competitive Transition Charge amortization, partially offset by increased
delivery revenues, net of fuel costs.
ComEd's distribution system reliability, delivery performance, and customer
satisfaction statistics, continued to improve, and PECO Energy was praised for
improved customer service in a report recently released by the Pennsylvania
Public Utility Commission.
Generation consists of Exelon's electric generation facilities and power
marketing operations. Revenues increased 14% to $1,618 million compared to pro
forma revenues in the second quarter of 2000. This increase reflects continued
strong nuclear performance, the expansion of power marketing activities and
additions to the supply portfolio, partially offset by the impact of lower
wholesale prices in both the PJM and ComEd markets. Generation's second quarter
EBIT of $126 million increased 66% over pro forma EBIT for the comparable
prior-year period of $76 million.
Exelon Generation is well on track to achieving its longer-term operating goals:
o 1,950 of the 3,000 megawatts targeted for this year have been acquired. The
Power Team energy supply portfolio, currently totaling over 41,000
megawatts, is projected to grow to 49,000 megawatts by 2003.
o 243 of the approximately 885 megawatts to be added through power uprate
projects by 2003 have been achieved.
o The year-to-date June 30 nuclear capacity factor is 96.2% compared to the
year-to-date goal of 93%. The target capacity factor for the year is 91.6%
reflecting five refueling outages scheduled for the fall.
Enterprises consists of competitive retail energy sales, energy and
infrastructure services, communications and related investments. Enterprises
revenues were $546 million in the second quarter, an increase of 36% compared to
second quarter 2000 pro forma revenues of $401 million. EBIT was a loss of $5
million in the quarter compared to a pro forma EBIT loss of $42 million in the
second quarter of 2000. Enterprises EBIT reflects lower margins in the
infrastructure services business, which has been impacted by the significant
downturn in the telecommunications industry. The sluggish performance of the
infrastructure services business was partially offset by a gain from the sale of
certain communications investments.
Conference call information:
Exelon has scheduled a Second Quarter Earnings Conference Call for 3 PM EDT; (2
PM CDT) on July 24. The call in number in the US is 800/289-0518; the
international call in number is 913/981-5532. No password is required. Media
representatives are invited to participate on a listen only basis. The call will
be audio web-cast and archived on Exelon's web site: www.exeloncorp.com. (Please
choose the Investor Relations page.)
Telephone replays will be available after 4 PM on July 24 through July 30. The
U.S. call-in number is 888/203-1112; the international call-in number is
719/457-0820. The confirmation code is 789042.
Except for the reported historical information, matters discussed in this
release are forward-looking statements that are subject to risks and
uncertainties. The factors that could cause actual results to differ materially
include future events affecting the demand for, and the supply of, energy,
including weather and economic conditions and the availability of generating
units, and other factors discussed in Exelon's filings with the SEC. Readers are
cautioned not to place undue reliance on these forward-looking statements, which
speak only as of the date of this release. Exelon undertakes no obligation to
publicly release any revision to these forward-looking statements to reflect
events or circumstances after the date of this release.
Exelon Corporation is one of the nation's largest electric utilities with
approximately five million customers and more than $15 billion in annual
revenues. The company has one of the industry's largest portfolios of
electricity generation capacity, with a nationwide reach and strong positions in
the Midwest and Mid-Atlantic. Exelon distributes electricity to approximately
five million customers in Illinois and Pennsylvania and gas to 425,000 customers
in the Philadelphia area. The company also has holdings in such competitive
businesses as energy, infrastructure services and energy services. Exelon is
headquartered in Chicago and trades on the NYSE under the ticker EXC.
EXELON CORPORATION
Earnings Summary
(in millions, except per share data)
Three Months Ended Six Months Ended
June 30, June 30,
---------------------------------- ----------------------------------
Pro Forma Pro Forma
2001 2000 (1) 2000 (2) 2001 2000 (1) 2000 (2)
------- ------- ------- ------- ------- -------
Revenue
Energy Delivery $ 2,436 $ 771 $ 2,271 $ 4,933 $ 1,620 $ 4,544
Generation 1,618 633 1,414 3,246 1,131 2,606
Enterprises 546 271 401 1,213 517 756
Corporate/Intercompany Eliminations (949) (290) (898) (1,918) (530) (1,718)
------- ------- ------- ------- ------- -------
Total Exelon $ 3,651 $ 1,385 $ 3,188 $ 7,474 $ 2,738 $ 6,188
======= ======= ======= ======= ======= =======
Earnings Before Interest and Taxes
Energy Delivery $ 706 $ 257 $ 643 $ 1,387 $ 594 $ 1,260
Generation 126 78 76 419 117 186
Enterprises (5) (32) (42) (36) (44) (55)
Corporate/Intercompany Eliminations (6) 1 8 (12) (1) 17
------- ------- ------- ------- ------- -------
Total Exelon 821 304 685 1,758 666 1,408
Interest Income 27 11 42 49 27 105
Interest Expense & Preferred Dividends (306) (121) (282) (606) (230) (561)
Income Taxes (227) (75) (177) (499) (176) (329)
Extraordinary Item, Net of Income Taxes -- (3) -- -- (3) --
Cumulative Effect of Change in Accounting
Principle, Net of Income Taxes -- -- -- 12 24 --
------- ------- ------- ------- ------- -------
Net Income $ 315 $ 116 $ 268 $ 714 $ 308 $ 623
======= ======= ======= ======= ======= =======
Average Common Shares Outstanding
Basic: 321 174 320 178
Diluted: 324 175 324 323 179 323
Earnings Per Common Share - Reported
Basic: $ 0.98 $ 0.67 $ 2.23 $ 1.73
Diluted: $ 0.97 $ 0.66 $ 2.21 $ 1.72
Nonrecurring Items excluded from
Operating Earnings:
Premiums paid to reacquire debt -- 0.02 -- 0.02
Cumulative effect of change in accounting
method for nuclear outages -- -- -- (0.13)
Implementation of SFAS 133 -- -- (0.04) --
Merger Costs -- 0.03 -- 0.07
------- ------- ------- -------
Earnings Per Common Share - Operating
Diluted: $ 0.97 $ 0.71 $ 0.83 $ 2.17 $ 1.68 $ 1.93
======= ======= ======= ======= ======= =======
(1) Reflects PECO Energy stand-alone earnings, restated to reflect change in
accounting method for nuclear outage costs.
(2) Pro forma 2000 data reflects operations as if the merger occurred on
January 1, 2000.
EXELON CORPORATION
Retail Electric Sales Statistics
For the Three Months Ended June 30
ComEd PECO
------------------------------------------ ------------------------------------------
MWH Sales 2001 2000 % Change 2001 2000 % Change
--------- ---------- ---------- ---------- ---------- ----------- ----------
Residential 5,231,699 5,095,773 2.7% 2,520,984 2,538,146 (0.7%)
Small Commercial & Industrial 7,246,759 6,914,496 4.8% 1,835,660 1,798,142 2.1%
Large Commercial & Industrial 5,516,303 6,131,010 (10.0%) 3,903,853 4,043,136 (3.4%)
Public Authorities & Electric Railroads 2,310,170 2,050,780 12.6% 183,401 192,062 (4.5%)
----------- ----------- ----------- -----------
Total Sales to Ultimate Customers 20,304,931 20,192,059 0.6% 8,443,898 8,571,486 (1.5%)
=========== =========== =========== ===========
Heating Degree Days 667 733 418 503
Cooling Degree Days / Hours 233 194 2,740 2,835
Revenue (in thousands) 2001 2000 % Change 2001 2000 % Change
---------------------- ---------- ---------- ---------- ---------- ----------- ----------
Residential $ 501,657 $ 494,861 1.4% $ 288,875 $ 293,738 (1.7%)
Small Commercial & Industrial 532,533 526,510 1.1% 184,674 145,758 26.7%
Large Commercial & Industrial 250,751 277,978 (9.8%) 242,770 172,934 40.4%
Public Authorities & Electric Railroads 129,827 122,827 5.7% 17,436 11,465 52.1%
----------- ----------- ----------- -----------
Total Sales to Ultimate Customers $ 1,414,768 $ 1,422,176 (0.5%) $ 733,755 $ 623,895 17.6%
=========== =========== =========== ===========
Cents / kWh 2001 2000 % Change 2001 2000 % Change
----------- ---------- ---------- ---------- ---------- ----------- ----------
Residential $ 0.096 $ 0.097 (1.0%) $ 0.115 $ 0.116 (0.9%)
Small Commercial & Industrial $ 0.073 $ 0.076 (3.9%) $ 0.101 $ 0.081 24.7%
Large Commercial & Industrial $ 0.045 $ 0.045 0.0% $ 0.062 $ 0.043 44.2%
Public Authorities & Electric Railroad $ 0.056 $ 0.060 (6.7%) $ 0.095 $ 0.060 58.3%
Total Sales to Ultimate Customers $ 0.070 $ 0.070 0.0% $ 0.087 $ 0.073 19.2%
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
EXELON CORPORATION
/s/ Ruth Ann M. Gillis
------------------------------
Ruth Ann M. Gillis
Principal Financial Officer
July 25, 2001