10-QPeriod: Q3 FY2019

EXELON CORP Quarterly Report for Q3 Ended Sep 30, 2019

Filed October 31, 2019For Securities:EXC

Summary

Exelon Corporation reported net income attributable to common shareholders of $772 million, or $0.79 per diluted share, for the three months ended September 30, 2019, a slight increase from $733 million, or $0.76 per diluted share, in the same period of the prior year. For the nine months ended September 30, 2019, net income attributable to common shareholders increased to $2.164 billion, or $2.22 per diluted share, compared to $1.858 billion, or $1.92 per diluted share, in the prior year. The results reflect a complex interplay of factors including improved operational performance from lower nuclear outage days and favorable regulatory rate increases across several utilities, offset by lower capacity prices and unfavorable weather impacts at some subsidiaries. The company also benefited from the absence of certain charges related to early plant retirements and ARO remeasurements seen in the prior year. Management highlights ongoing cost management initiatives and strategic adjustments in response to market conditions.

Financial Highlights

50 data points
Beta

Revenue

$8.93B

Net Income

$772.00M

8.6% Net Margin

EPS (Diluted)

$0.79

Total Assets

$122.74B

Cash & Equivalents

$1.68B

Free Cash Flow

$814.00M

Financial Statements
Beta
Revenue$8.93B
Operating Expenses$7.56B
Operating Income$1.35B
Interest Expense$403.00M
Net Income$772.00M
EPS (Basic)$0.79
EPS (Diluted)$0.79
Shares Outstanding (Basic)973.00M
Shares Outstanding (Diluted)974.00M

Key Highlights

  • 1Net income attributable to common shareholders increased by $39 million to $772 million for the three months ended September 30, 2019, compared to the prior year period.
  • 2Diluted earnings per share improved to $0.79 from $0.76 for the three months ended September 30, 2019, compared to the prior year period.
  • 3Nine-month net income attributable to common shareholders rose by $306 million to $2.164 billion.
  • 4Diluted earnings per share for the nine months improved to $2.22 from $1.92.
  • 5Key drivers for the improved performance include the absence of charges related to early plant retirements and ARO remeasurements, lower nuclear outage days, and favorable regulatory rate increases at several utility subsidiaries.
  • 6Offsetting factors include lower capacity prices, lower mark-to-market gains, and unfavorable weather conditions impacting certain segments.
  • 7The company continues to focus on cost management, announcing additional annual cost savings of approximately $100 million at Exelon Generation by 2022.

Frequently Asked Questions

For the three months ended September 30, 2019, Exelon reported net income attributable to common shareholders of $772 million, or $0.79 per diluted share, an increase from $733 million, or $0.76 per diluted share, in the same period of the prior year. This improvement was driven by factors such as the absence of prior-year charges, lower nuclear outage days, and regulatory rate increases, partially offset by lower capacity prices and unfavorable weather.

The year-over-year improvement in earnings was primarily driven by the absence of accelerated depreciation and amortization charges related to early plant retirements (Oyster Creek) and ARO remeasurements in the prior year, along with reduced nuclear outage days, increased ZEC revenues, and favorable regulatory rate increases across its utility operations. These positive impacts were partially offset by lower capacity prices, lower mark-to-market gains, and unfavorable weather conditions impacting certain segments.

Exelon continues to emphasize cost management, announcing an additional $100 million in annual cost savings at Exelon Generation by 2022. This focus on enhanced efficiency and productivity is a response to ongoing economic challenges in the generation business and aims to support the company's baseline operating performance and financial flexibility.

Exelon's utility subsidiaries regularly engage in base rate case proceedings to adjust rates and recover investments, which impact financial performance. The company is actively involved in managing these regulatory processes, including ongoing updates to transmission formula rates and energy efficiency programs, as well as monitoring legislative developments impacting clean energy and nuclear power, such as ZEC programs in various states.