01—Abstract
Summary
Summary of the 10-K filed February 5, 2010. Cited figures are marked; the original filing is the authoritative source.
Exelon Corporation, a utility services holding company, operates through its principal subsidiaries: Generation, ComEd, and PECO.
Generation is a major competitive electric generator with a significant nuclear fleet, while ComEd and PECO are regulated energy delivery companies serving northern Illinois and southeastern Pennsylvania, respectively. In 2009, Exelon reported net income of $2.71 billiona, a slight decrease from $2.74 billion in 2008, primarily impacted by lower revenue net of purchased power and fuel expense at Generation due to unfavorable market conditions and reduced hedging gains. ComEd saw improved net income due to higher distribution rates, while PECO experienced a slight increase in net income driven by higher gas distribution rates, though offset by reduced load.
Key strategic initiatives for 2010 include pursuing nuclear plant upgrades, expanding smart meter deployment at PECO with potential federal grant funding, and developing Exelon Transmission to capitalize on the growing national market for new transmission lines. The company continues to focus on cost management, having achieved $200 millionb in savings in 2009 through various efficiency initiatives.
02—Key points
Key Highlights
- Exelon's net income for 2009 was $2.71 billion, a slight decrease from $2.74 billion in 2008, primarily due to lower revenues at Generation.
- Generation experienced a $136 million decrease in income from continuing operations due to unfavorable market conditions and decreased hedging gains.
- ComEd's net income increased by $173 million, driven by higher distribution rates and lower operating expenses, despite reduced load.
- PECO's net income increased by $28 million, primarily due to higher gas distribution rates and cost savings, partially offset by reduced electric load.
- Exelon is investing in nuclear plant upgrades (uprates) expected to add 1,300-1,500 MW of capacity over eight years.
- PECO is planning significant investments in smart meter and smart grid infrastructure, potentially supported by $200 million in federal grant funds.
- Exelon established Exelon Transmission in 2009 to capitalize on the growing market for new transmission lines.
- The company implemented a company-wide cost savings initiative, achieving approximately $200 million in savings in 2009.
- Exelon's Generation segment is subject to commodity price risk in the wholesale power market, though hedging policies are in place to mitigate this.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-KFY2009filed February 5, 2010Financial Statements
FY2009 against FY2008
| Line item | FY2009FY2008 | Change |
|---|---|---|
| Revenue | $17.32B$18.86B | −8.2% |
| Operating Expenses | $12.57B$13.56B | −7.3% |
| Operating Income | $4.75B$5.30B | −10.4% |
| Interest Expense | $654.00M$699.00M | −6.4% |
| Net Income | $2.71B$2.74B | −1.1% |
| EPS (Basic) | $4.10$4.16 | −1.4% |
| EPS (Diluted) | $4.09$4.13 | −1.0% |
| Shares Outstanding (Basic) | 659.00M658.00M | +0.2% |
| Shares Outstanding (Diluted) | 662.00M662.00M | 0.0% |
05—Questions
Frequently Asked Questions
What were Exelon's key financial results for 2009?
Exelon reported net income of $2.71 billion for 2009, a slight decrease from $2.74 billion in 2008. This was primarily driven by lower revenues at Generation due to unfavorable market conditions and reduced hedging gains, partially offset by improved results at ComEd due to higher distribution rates and cost savings.
What are Exelon's main growth initiatives for 2010?
Exelon is focusing on several growth initiatives, including upgrading its nuclear plants to increase capacity, expanding smart meter and smart grid infrastructure at PECO with potential federal grant funding, and establishing Exelon Transmission to invest in new transmission lines.
How is Exelon managing costs?
Exelon implemented a company-wide cost management initiative in 2009, achieving approximately $200 million in savings. This initiative includes actions such as reducing employee positions, improving productivity, and stringent controls on spending. The company plans to continue its cost control focus in 2010.
What risks does Exelon face in its Generation segment?
Exelon's Generation segment is exposed to commodity price risk in the wholesale power market due to fluctuations in supply and demand, fuel costs, and market liquidity. The company employs hedging policies to mitigate this risk, but prolonged depressed electricity prices could adversely impact its results.
06—Continue