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Discussion of Financial Results – Enterprises
Results of Operations – Enterprises
As previously described, effective January 1, 2004, Enterprises contributed its interest in Exelon Energy Company to
Generation. Exelon Energy Company was previously reported as a part of the Enterprises segment. For comparative discussion
and analysis, the results of Exelon Energy Company have been excluded from Enterprises’ 2003 results of operations dis-
cussed below.
in millions 2004 2003
Favorable
(Unfavorable)
Variance
Operating revenues $155 $ 923 $(768)
Operating and maintenance expense 211 1,027 816
Operating loss (62) (139) 77
Loss before income taxes, minority interest and cumulative effect
of changes in accounting principles (7) (187) 180
Loss before cumulative effect of changes in accounting principles (13) (117) 104
Net loss (22) (118) 96
The decrease in Enterprises’ net loss before cumulative effect of changes in accounting principles in 2004 was primarily due to
a decrease in operating and maintenance expense, partially offset by a decrease in operating revenues. Depreciation and
amortization expense decreased $23 million before income taxes from 2003 to 2004 primarily as a result of the sale of the
majority of property, plant and equipment since September 2003. In 2004, Enterprises recorded impairment charges of invest-
ments of $15 million before income taxes due to other-than-temporary declines in value, partially offset by 2003 charges for
impairment of investments of $46 million before income taxes and a net impairment of other assets of $8 million before income
taxes. The adoption of EITF 03-16 increased the 2004 net loss by $9 million. The adoption of SFAS No. 143 increased the 2003
net loss by $1 million, net of income taxes.
EXELON CORPORATION AND SUBSIDIARY COMPANIES 31