ComEd 2005 Annual Report Download

Download and view the complete annual report

Please find the complete 2005 ComEd annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 42

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42

meeting the challenge
Exelon Corporation 05 Summary Annual Report

Table of contents

  • Page 1
    meeting the challenge Exelon Corporation 05 Summary Annual Report

  • Page 2
    01 02 10 12 14 16 18 20 22 23 24 Introduction Letter to Shareholders Meeting the operational challenge Meeting the financial challenge Meeting the workplace challenge Meeting the environmental challenge Achieving our Vision Exelon at a Glance Strategy and Policy Committee Board of Directors ...

  • Page 3
    ... new challenges, in both Illinois and New Jersey. We are determined to meet these challenges, just as we have met past challenges, and turn them into opportunities for our customers, our employees, and for you, our shareholders. We are Exelon, always striving to be the best electric and gas company...

  • Page 4
    John W. Rowe Chairman, President and CEO 2

  • Page 5
    ...in Illinois. *For a more complete reconciliation of adjusted (non GAAP) operating earnings to GAAP (accounting principles generally accepted in the United States) earnings, see Exelon's fourth quarter earnings release, issued January 25, 2006, posted on the Investor Relations page at www.exeloncorp...

  • Page 6
    ... us the number one electric utility in the Americas and number three in the world in its December 2005 list. I congratulate the Exelon management team and all of our employees for earning this recognition from Fortune magazine. vision We strive to be the very best electric and gas company in the...

  • Page 7
    ... Among other initiatives, BSC introduced a new operations management system in 2005, enabling ComEd to respond more quickly and effectively in restoring service to customers, implemented an online employee self-service payroll and benefits administration program, and automated our invoice processing...

  • Page 8
    ... performance of both of our delivery companies. I would like to thank the management team pictured in the back of this report, and all of our other managers and employees, for their hard work and sacrifice. challenges Of course, success does not come without new challenges. Despite our success, and...

  • Page 9
    ...challenges it faces. ComEd now has an independent Board of Directors and a separate senior management team. Frank Clark heads up that team as Chairman and CEO, with Barry Mitchell serving as President, John Costello serving as Executive Vice President and Chief Operating Officer, and Robert McDonald...

  • Page 10
    ... the security of our energy supply, and an increasingly urgent need to address global climate and other environmental issues, we need utility companies with the financial strength to develop and deploy new and innovative forms of generation and transmission. The new company, Exelon Electric & Gas...

  • Page 11
    ... strong balance sheet and the financial discipline to sustain us in good times and bad. We have the management talent and employees to keep the lights on and continuously improve our operating performance even as we confront the challenges of Illinois and New Jersey. We have a sound Vision - we know...

  • Page 12

  • Page 13
    ... to safety. Safety is our number one priority, for our employees, our customers, and the communities we serve. Our pending merger with PSEG will afford us greater opportunities to improve our operational performance. The new company will combine Exelon's expertise in nuclear operations with...

  • Page 14
    ... investors. Our financial performance has made Exelon one of the most highly valued utilities in the industry. Over the past five years, our operating earnings per diluted share have increased by almost 10 percent a year. And, our total return was 112 percent for the five-year period ending in 2005...

  • Page 15

  • Page 16

  • Page 17
    ... communicate and to show respect to our employees. The merger with PSEG is about building a new culture, one that will better enable the new company to set the standard for the industry. Even as we work to meet our commitments to our customers and provide superior financial value to our shareholders...

  • Page 18
    ... options, such as natural gas, energy efficiency, renewable energy, emerging clean coal technologies and new nuclear energy. We are determined to meet the future energy needs of our customers reliably, affordably, and consistently with good environmental practice. developing greener solutions 16

  • Page 19

  • Page 20

  • Page 21
    ... achieve our Vision through enhanced earnings, regulatory and market diversity, increased operating flexibility, strong stable cash flow and an experienced management team. The pending merger will create substantial benefits to all of our customers, employees, investors and the communities we serve...

  • Page 22
    ... energy systems atop the Social Security Administration Building in Chicago. PECO focused its efforts during 2005 on key regulatory issues, improving customer communications and satisfaction, maintaining the system during peak load periods, and positive employee engagement. PECO secured approval...

  • Page 23
    ...In addition, Exelon Nuclear continued its industry leadership in outage execution, completing nine refueling outages in an average of 24 days. Exelon Power, with approximately 615 employees, operates the company's fossil and hydroelectric fleet of generating assets. With plants in Illinois, Maryland...

  • Page 24
    Strategy and Policy Committee John W. Rowe Chairman, President and Chief Executive Officer Frank M. Clark Chairman and CEO, ComEd Ian P. McLean Executive Vice President, Exelon and President, Power Team Randall E. Mehrberg Executive Vice President, Chief Administrative Officer, and Chief Legal ...

  • Page 25
    ...Chief Executive Officer, Ariel Capital Management LLC John W. Rowe Chairman, President and Chief Executive Officer, Exelon Corporation Ronald Rubin Chairman and Chief Executive Officer, Pennsylvania Real Estate Investment Trust Richard L. Thomas Retired Chairman, First Chicago NBD Corporation 23

  • Page 26
    ... Financial Statements: > Consolidated Statements of Income > Consolidated Statements of Cash Flows > Consolidated Balance Sheets > Consolidated Statements of Changes in Shareholders' Equity > Consolidated Statements of Comprehensive Income Management's Report on Internal Control Over Financial...

  • Page 27
    ... due to the goodwill impairment charge of $1.2 billion in 2005. (b) Due to the adoptions of FIN 46 and FIN 46-R in 2003, the mandatorily redeemable preferred securities of ComEd and PECO were reclassified as long-term debt to financing trusts in 2003. EXELON CORPORATION AND SUBSIDIARY COMPANIES 25

  • Page 28
    ...See Note 1 of Exelon's Notes to Consolidated Financial Statements within its 2005 Form 10-K for further information regarding the adoption of FIN 46-R. Operating Revenues. Operating revenues increased primarily due to increased revenues at ComEd and PECO and increased revenues from non-affiliates at...

  • Page 29
    ... Department of Energy, an increase to the reserve for the estimated future asbestosrelated bodily injury claims that was recorded in 2005, higher costs associated with planned nuclear refueling outages, and increased costs related to an operating agreement with a subsidiary of Tamuin International...

  • Page 30
    ... 2005 and 2004 operating results and other statistical information set forth below include intercompany transactions, which are eliminated in Exelon's consolidated financial statements. Net Income (Loss) from Continuing Operations by Business Segment 2005 2004 Favorable (unfavorable) variance ComEd...

  • Page 31
    ... of Financial Results - ComEd Results of Operations - ComEd 2005 2004 Favorable (unfavorable) variance Operating revenues Operating expenses Purchased power Operating and maintenance Impairment of goodwill Depreciation and amortization Taxes other than income Total operating expense Operating...

  • Page 32
    ... revenues, net of related purchased power expense, due to favorable weather and lower interest expense due to the scheduled retirement of debt owed to the PECO Energy Transition Trust, partially offset by higher CTC regulatory asset amortization. 30 EXELON CORPORATION AND SUBSIDIARY COMPANIES

  • Page 33
    ... increase in prices associated with Generation's power sales agreement with ComEd and higher average margins on wholesale market sales as higher spot market prices more than compensated for higher fuel prices and the impact of higher nuclear generation. EXELON CORPORATION AND SUBSIDIARY COMPANIES...

  • Page 34
    Exelon Corporation and Subsidiary Companies Consolidated Statements of Income (in millions, except per share data) For the Years Ended December 31, 2005 2004 2003 Operating revenues Operating expenses Purchased power Purchased power from AmerGen Energy Company, LLC Fuel Operating and maintenance ...

  • Page 35
    ... the SEC. See also management's discussion and analysis of financial condition and results of operation, which includes a discussion of critical accounting policies and estimates, on pages 78 through 148 of Exelon's 2005 Form 10-K filed with the SEC. EXELON CORPORATION AND SUBSIDIARY COMPANIES 33

  • Page 36
    ... the SEC. See also management's discussion and analysis of financial condition and results of operation, which includes a discussion of critical accounting policies and estimates, on pages 78 through 148 of Exelon's 2005 Form 10-K filed with the SEC. 34 EXELON CORPORATION AND SUBSIDIARY COMPANIES

  • Page 37
    ... the SEC. See also management's discussion and analysis of financial condition and results of operation, which includes a discussion of critical accounting policies and estimates, on pages 78 through 148 of Exelon's 2005 Form 10-K filed with the SEC. EXELON CORPORATION AND SUBSIDIARY COMPANIES 35

  • Page 38
    ... the SEC. See also management's discussion and analysis of financial condition and results of operation, which includes a discussion of critical accounting policies and estimates, on pages 78 through 148 of Exelon's 2005 Form 10-K filed with the SEC. 36 EXELON CORPORATION AND SUBSIDIARY COMPANIES

  • Page 39
    ... the SEC. See also management's discussion and analysis of financial condition and results of operation, which includes a discussion of critical accounting policies and estimates, on pages 78 through 148 of Exelon's 2005 Form 10-K filed with the SEC. EXELON CORPORATION AND SUBSIDIARY COMPANIES 37

  • Page 40
    ... 31, 2005, Exelon's internal control over financial reporting was effective. February 15, 2006 Information Derived from 2005 Form 10-K We have presented a condensed discussion of financial results, excerpts from our consolidated financial statements and a copy of our Management's Report on Internal...

  • Page 41
    ... information Corporate Headquarters Exelon Corporation P.O. Box 805398 Chicago, IL 60680-5398 Independent Public Accountants PricewaterhouseCoopers LLP Website www.exeloncorp.com New York Stock Exchange Listing EXC Shareholder Inquiries Computershare Trust Company, N.A., is Dividend Disbursing Agent...

  • Page 42
    Exelon Corporation P.O. Box 805398 Chicago, IL 60680-5398 www.exeloncorp.com ©2006 Exelon