Exelon Corporation · NASDAQ:EXC
Exelon — Q2 2021 Earnings Presentation
44 slides from Exelon's earnings presentation, Aug 4, 2021
Slide 1: Earnings Conference Call Second Quarter 2021
Earnings Conference Call Second Quarter 2021 August 4, 2021
Slide 2: Cautionary Statements Regarding Forward-Looking Information
2 Q2 2021 Earnings Release Slides Cautionary Statements Regarding Forward-Looking Information This presentation 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,
Slide 3: Non-GAAP Financial Measures
3 Q2 2021 Earnings Release Slides Non-GAAP Financial Measures Exelon reports its financial results in accordance with accounting principles generally accepted in the United States (GAAP). Exelon supplements the reporting of financial information determined in accordance with GAAP with certain non-GA
Slide 4: Non-GAAP Financial Measures Continued
4 Q2 2021 Earnings Release Slides Non-GAAP Financial Measures Continued This information is intended to enhance an investor’s overall understanding of period over period financial results and provide an indication of Exelon’s baseline operating performance by excluding items that are considered by m
Slide 5: Second Quarter Results
5 Q2 2021 Earnings Release Slides Second Quarter Results • Received outcomes in our Pepco DC and MD multi-year plans • NJ BPU approved ACE settlement and PAPUC issued order in PECO Gas rate case • 22/23 PJM Base Residual Auction held • Zero-Emission Nuclear Power Production Credit Act of 2021 introd
Slide 6: Operating Highlights
6 Q2 2021 Earnings Release Slides Operating Highlights (1) 2.5 Beta SAIFI is YE projection (2) Excludes Salem and EDF’s equity ownership share of the CENG Joint Venture Exelon Utilities Operational Metrics Exelon Generation Operational Performance • Best in class performance across our Nuclear fleet
Slide 7: Progress on Separation
7 Q2 2021 Earnings Release Slides Progress on Separation Commission Application Filing Key Regulatory Milestones New York Public Service Commission (NY PSC) (Case No. 21-E-0130) February 25, 2021 • Comments/intervention were due June 8, 2021 Federal Energy Regulatory Commission (FERC) (Docket No. EC
Slide 8: Exelon Utilities Path to Clean: Net-Zero by 2050
8 Q2 2021 Earnings Release Slides Exelon Utilities Path to Clean: Net-Zero by 2050 Invest in natural gas infrastructure modernization to minimize methane leakage Invest in our own vehicle fleet to deliver on our vehicle electrification targets Focus on energy efficiency and clean electricity for our
Slide 9: Transforming Communities Through Our Workforce Development Strategy
9 Q2 2021 Earnings Release Slides Barrier Elimination or Reduction Reduce or remove employment barriers faced by youth and work- ready adults in under-served and under-resourced communities Transforming Communities Through Our Workforce Development Strategy 1 STEM Education and Vocational Awareness
Slide 10: Second Quarter Adjusted Operating Earnings Drivers
10 Q2 2021 Earnings Release Slides $0.20 $0.15 $0.11 $0.05 $0.40 ($0.02) ComEd Q2 2021 PECO ExGen HoldCo BGE PHI $0.89 Second Quarter Adjusted Operating Earnings* Drivers Exelon Utilities • Utilities performed well in Q2 driven by continued investment and distribution rate case outcomes • No major s
Slide 11: Q2 2021 QTD Adjusted Operating Earnings Waterfall
11 Q2 2021 Earnings Release Slides Q2 2021 QTD Adjusted Operating Earnings* Waterfall $0.55 $0.89 $0.05 $0.06 $0.05 $0.14 ExGen(6)PECOComEd2020 BGE $0.01 $0.03 PHI Corp 2021 $0.10 Net Unrealized and Realized Gains on Equity Investments $0.04 Higher Realized NDT Fund Gains $0.03 Nuclear Outages(3) $0
Slide 12: Exelon Utilities Trailing Twelve Month Earned ROEs
12 Q2 2021 Earnings Release Slides Exelon Utilities Trailing Twelve Month Earned ROEs* Exelon Utilities’ Consolidated Trailing Twelve Month Earned ROEs* 9.4% 9.6% 9.6% 10.2% 10.2% 10.1% 10.0% 9.7% 9.1% 8.9% 8.7% 8.9% 9.4% Q4 2018Q2 2018 Q1 2020Q2 2019Q3 2018 Q1 2019 Q3 2019 Q4 2019 Q2 2020 Q3 2020 Q
Slide 13: Exelon Utilities' Distribution Rate Case Updates
13 Q2 2021 Earnings Release Slides Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Revenue Requirement Requested ROE / Equity Ratio Expected Order $108.6M (1,2) 3-Year MYP 9.275% / 50.68% Jun 8, 2021 $29.1M (1) 10.24% / 53.38% Jun 22, 2021 $52.2M (1,3) 3-Year MYP 9.55% / 50.50% Jun 28, 2021 $41.0M (
Slide 14: Exelon Generation: Gross Margin Update
14 Q2 2021 Earnings Release Slides Exelon Generation: Gross Margin* Update (1) Gross margin* categories rounded to nearest $50M (2) Excludes EDF’s equity ownership share of the CENG Joint Venture (3) Mark-to-Market of Hedges assumes mid-point of hedge percentages (4) Based on June 30, 2021 market co
Slide 15: 2021 Business Priorities and Commitments
15 Q2 2021 Earnings Release Slides 2021 Business Priorities and Commitments Meet or exceed our financial commitments Effectively deploy ~$6.6B of utility capex Ensure timely recovery on investments to enable customer benefits Support enactment of clean energy policies Continued demonstration of corp
Slide 16: Additional Disclosures
16 Q2 2021 Earnings Release Slides Additional Disclosures
Slide 17: Reaffirming 2021 Adjusted Operating Earnings Guidance
17 Q2 2021 Earnings Release Slides $0.55 - $0.85 $0.40 - $0.50 $0.55 - $0.65 $0.45 - $0.55 ($0.25) ComEd 2021 Guidance $0.75 - $0.85 ExGen BGE PECO PHI HoldCo $2.60 - $3.00(1) Reaffirming 2021 Adjusted Operating Earnings* Guidance Note: Amounts may not sum due to rounding (1) 2021 earnings guidance
Slide 18: Q2 2021 YTD Adjusted Operating Earnings Waterfall
18 Q2 2021 Earnings Release Slides Q2 2021 YTD Adjusted Operating Earnings* Waterfall $0.09 BGE2020 $0.03 PECOComEd PHI ($0.76) ExGen(7) ($0.10) Corp 2021 $0.07 $1.42 $0.07 ($0.84) Market and Portfolio Conditions(3) ($0.14) Income Taxes(4) ($0.03) Credit Loss Expense(3) $0.12 Higher Realized NDT Fun
Slide 19: Constellation Technology Ventures' Active Investments
19 Q2 2021 Earnings Release Slides Constellation Technology Ventures’ Active Investments Note: Constellation’s active technology investments can be found at http://technologyventures.constellation.com/; reflects current portfolio as of August 4, 2021 (1) Green boxes reflect companies that have execu
Slide 20: Exelon Debt Maturity Profile
20 Q2 2021 Earnings Release Slides Exelon’s weighted average LTD maturity is approximately 16 years (1) Maturity profile excludes non-recourse debt, securitized debt, capital leases, fair value adjustments, unamortized debt issuance costs and unamortized discount/premium (2) Long-term debt balances
Slide 21: Exelon Utilities
21 Q2 2021 Earnings Release Slides Exelon Utilities
Slide 22: Pepco DC Multi-Year Plan Case Filing Details
22 Q2 2021 Earnings Release Slides Multi-Year Plan Case Filing Details Notes Formal Case No. 1156 • May 30, 2019, Pepco DC filed a three-year multi- year plan (MYP) request with the Public Service Commission of the District of Columbia (DCPSC) seeking an increase in electric distribution base rates
Slide 23: PECO (Gas) Distribution Rate Case Filing Details
23 Q2 2021 Earnings Release Slides Rate Case Filing Details Notes Docket No. R-2020-3018929 • September 30, 2020, PECO filed a general base rate filing with the Pennsylvania Public Utility Commission (PAPUC) seeking an increase in gas distribution base rates • Size of ask is driven by continued inve
Slide 24: Pepco MD Multi-Year Plan Case Filing Details
24 Q2 2021 Earnings Release Slides Multi-Year Plan Case Filing Details Notes Formal Case No. 9655 • October 26, 2020, Pepco MD filed a three-year multi-year plan (MYP) request with the Maryland Public Service Commission (MDPSC) seeking an increase in electric distribution base rates • June 28, 2021,
Slide 25: ACE Distribution Rate Case Filing Details
25 Q2 2021 Earnings Release Slides Rate Case Filing Details Notes Docket No. ER20120746 • December 9, 2020, ACE filed a distribution base rate case with the New Jersey Board of Public Utilities (NJBPU) to increase distribution base rates • July 14, 2021, the NJBPU approved the settlement with new ra
Slide 26: Delmarva DE (Electric) Distribution Rate Case Filing Details
26 Q2 2021 Earnings Release Slides Rate Case Filing Details Notes Docket No. 20-0149 • March 6, 2020, Delmarva Power filed an application with the Delaware Public Service Commission (DPSC) seeking an increase in electric distribution base rates • A partial settlement agreement, primarily on customer
Slide 27: PECO (Electric) Distribution Rate Case Filing Details
27 Q2 2021 Earnings Release Slides Rate Case Filing Details Notes Docket No. R-2021-3024601 • On March 30, 2021, PECO filed a general base rate request with the Pennsylvania Public Utility Commission (PAPUC) seeking an increase in electric distribution base rates • Rate increase amount is driven by
Slide 28: ComEd Distribution Rate Case Filing Details
28 Q2 2021 Earnings Release Slides Rate Case Filing Details Notes Docket No. 21-0367 • April 16, 2021, ComEd filed its annual distribution formula rate update with the Illinois Commerce Commission (ICC) seeking a $51.2M increase to distribution base rates • Rate increase amount is driven by continue
Slide 29: Exelon Generation Disclosures June 30, 2021
29 Q2 2021 Earnings Release Slides Exelon Generation Disclosures June 30, 2021
Slide 30: Portfolio Management Strategy
30 Q2 2021 Earnings Release Slides Portfolio Management Strategy Protect Balance Sheet Ensure Earnings Stability Create Value Exercising Market Views % H e d g e d Purely ratable Actual hedge % Market views on timing, product allocation and regional spreads reflected in actual hedge % High End of Pr
Slide 31: Components of Gross Margin Categories
31 Q2 2021 Earnings Release Slides Components of Gross Margin* Categories Open Gross Margin* •Generation Gross Margin* at current market prices, including ancillary revenues, nuclear fuel amortization and fuels expense •Power Purchase Agreement (PPA) Costs and Revenues •Provided at a consolidated le
Slide 32: ExGen Disclosures
32 Q2 2021 Earnings Release Slides ExGen Disclosures (1) Gross margin* categories rounded to nearest $50M (2) Excludes EDF’s equity ownership share of the CENG Joint Venture (3) Mark-to-Market of Hedges assumes mid-point of hedge percentages (4) Based on June 30, 2021 market conditions (5) Reflects
Slide 33: ExGen Disclosures
33 Q2 2021 Earnings Release Slides ExGen Disclosures (1) Expected generation is the volume of energy that best represents our commodity position in energy markets from owned or contracted for capacity based upon a simulated dispatch model that makes assumptions regarding future market conditions, wh
Slide 34: ExGen Hedged Gross Margin Sensitivities
34 Q2 2021 Earnings Release Slides ExGen Hedged Gross Margin* Sensitivities (1) Based on June 30, 2021 market conditions and hedged position; gas price sensitivities are based on an assumed gas-power relationship derived from an internal model that is updated periodically; power price sensitivities
Slide 35: 2021 ExGen Hedged Gross Margin Upside/Risk
35 Q2 2021 Earnings Release Slides 5,000 5,500 6,000 6,500 7,000 2021 ExGen Hedged Gross Margin* Upside/Risk A p p ro xi m a te G ro s s M a rg in * ( $ m il li o n )(1 ) (1) Represents an approximate range of expected gross margin*, taking into account hedges in place, between the 5th and 95th perc
Slide 36: Additional ExGen Modeling Data
36 Q2 2021 Earnings Release Slides Additional ExGen Modeling Data Total Gross Margin Reconciliation (in $M)(1) 2021 Revenue Net of Purchased Power and Fuel Expense*(2,3) $7,150 Other Revenues(4) $(175) Direct cost of sales incurred to generate revenues for certain Constellation and Power businesses
Slide 37: Appendix Reconciliation of Non-GAAP Measures
37 Q2 2021 Earnings Release Slides Appendix Reconciliation of Non-GAAP Measures
Slide 38: Q2 QTD GAAP EPS Reconciliation
38 Q2 2021 Earnings Release Slides Q2 QTD GAAP EPS Reconciliation Three Months Ended June 30, 2021 ComEd PECO BGE PHI ExGen Other Exelon 2021 GAAP Earnings (Loss) Per Share $0.20 $0.11 $0.05 $0.14 ($0.06) ($0.02) $0.41 Mark-to-market impact of economic hedging activities - - - - (0.24) - (0.24) Unre
Slide 39: Q2 QTD GAAP EPS Reconciliation (continued)
39 Q2 2021 Earnings Release Slides Q2 QTD GAAP EPS Reconciliation (continued) Three Months Ended June 30, 2020 ComEd PECO BGE PHI ExGen Other Exelon 2020 GAAP Earnings (Loss) Per Share ($0.06) $0.04 $0.04 $0.10 $0.49 ($0.07) $0.53 Mark-to-market impact of economic hedging activities - - - - (0.06) 0
Slide 40: Q2 YTD GAAP EPS Reconciliation
40 Q2 2021 Earnings Release Slides Q2 YTD GAAP EPS Reconciliation Six Months Ended June 30, 2021 ComEd PECO BGE PHI ExGen Other Exelon 2021 GAAP Earnings (Loss) Per Share $0.40 $0.28 $0.26 $0.27 ($0.87) ($0.22) $0.11 Mark-to-market impact of economic hedging activities - - - - (0.38) - (0.37) Unreal
Slide 41: Q2 YTD GAAP EPS Reconciliation (continued)
41 Q2 2021 Earnings Release Slides Q2 YTD GAAP EPS Reconciliation (continued) Six Months Ended June 30, 2020 ComEd PECO BGE PHI ExGen Other Exelon 2020 GAAP Earnings (Loss) Per Share $0.11 $0.18 $0.22 $0.21 $0.53 ($0.13) $1.13 Mark-to-market impact of economic hedging activities - - - - (0.16) 0.01
Slide 42: Projected GAAP to Operating Adjustments
42 Q2 2021 Earnings Release Slides Projected GAAP to Operating Adjustments • Exelon’s projected 2021 adjusted (non-GAAP) operating earnings excludes the earnings effects of the following: − Mark-to-market adjustments from economic hedging activities; − Unrealized gains and losses from NDT funds to t
Slide 43: GAAP to Non-GAAP Reconciliations: EU Operating TTM ROE
43 Q2 2021 Earnings Release Slides GAAP to Non-GAAP Reconciliations Consolidated EU Operating TTM ROE Reconciliation ($M) Q4 2018 Q3 2018 Q2 2018 Net Income (GAAP) $1,836 $1,770 $1,724 Operating Exclusions $32 $40 $13 Adjusted Operating Earnings $1,869 $1,810 $1,737 Average Equity $19,367 $18,878 $1
Slide 44: GAAP to Non-GAAP Reconciliations: ExGen Adjusted O&M
44 Q2 2021 Earnings Release Slides GAAP to Non-GAAP Reconciliations ExGen Adjusted O&M Reconciliation ($M)(1) 2021 GAAP O&M $4,475 Decommissioning(2) $75 Byron and Dresden Retirements(3) $475 Asset Impairments(4) ($500) Direct cost of sales incurred to generate revenues for certain Constellation and