Exelon 2002 Annual Report Download - page 26

(Dollars in millions, unless otherwise noted)
general business
On October 20,2000,Exelon Corporation (Exelon or we) became
the parent corporation for PECO Energy Company (PECO) and
Commonwealth Edison Company (ComEd) as a result of a
merger among PECO,Unicom Corporation (Unicom),the former
parent company of ComEd, and Exelon (Merger). The Merger
was accounted for using the purchase method of accounting
with PECO as the acquiring company.Accordingly, our results of
operations for 2000 consist of PECO’s results of operations for
2000 and Unicom’s results of operations after October 20,2000.
During January 2001, we undertook a restructuring to
separate our generation and other competitive businesses from
our regulated energy delivery business at ComEd and PECO. As
part of the restructuring, the generation-related operations
and assets and liabilities of ComEd were transferred to Exelon
Generation Company, LLC (Generation). Also, as part of the
restructuring, the non-regulated operations and related assets
and liabilities of PECO, representing PECO’s generation and
enterprises business segments,were transferred to Generation
and Exelon Enterprises Company, LLC (Enterprises), respectively.
Additionally, certain operations and assets and liabilities of
ComEd and PECO were transferred to Exelon Business Services
Company (BSC). BSC provides Exelon and its subsidiaries finan-
cial, human resource, legal, information technology, supply
management and corporate governance services.
Exelon, a registered public utility holding company, through its
subsidiaries,now operates in three business segments:
Energy Delivery, whose businesses include the regulated sale of
electricity and distribution and transmission services by ComEd
in northern Illinois and PECO in southeastern Pennsylvania and
the sale of natural gas and distribution services by PECO in the
Pennsylvania counties surrounding the City of Philadelphia.
Generation, consisting of the owned and contracted for electric
generating facilities, energy marketing operations, and equity
interests in Sithe Energies, Inc. (Sithe) and AmerGen Energy
Company, LLC (AmerGen).
Enterprises,consisting of competitive retail energy sales,energy
and infrastructure services, communications and other invest-
ments (weighted towards the communications,energy services
and retail services industries).
See Note 20 of the Notes to Consolidated Financial Statements
for further segment information.
goals and strategies
Our vision is to build exceptional value—by becoming the best
and most consistently profitable electricity and gas company in
the United States.To implement our vision, we must
Live up to our commitments
– Keep the lights on.
– Perform safely—especially in nuclear operations.
– Constantly improve our environmental performance.
– Act honorably and treat everyone with respect, decency
and integrity.
– Continue building a high performance culture that reflects
the diversity of our communities.
– Report our results, opportunities and problems honestly and
reliably.
Perform at world-class levels
– Relentlessly pursue greater productivity,quality and innovation.
– Understand the relationships among our businesses and
optimize the whole.
– Promote and implement policies that build effective markets.
– Adapt rapidly to changing markets, politics, economics and
technology to meet our customers’ needs.
– Maximize the earnings and cash flow from our assets and
businesses and sell those that do not meet our goals.
Invest in our consolidating industry
– Develop strategies based on learning from past successes
and failures.
– Implement systems and best practices that can be applied to
future acquisitions.
– Prioritize acquisition opportunities based on synergies from
scale, scope, generation and delivery integration, and our
ability to profitably satisfy provider of last resort (POLR) and
other regulatory obligations.
– Make acquisitions that will best employ our limited invest-
ment resources to produce the most consistent cash flow and
earnings accretion.
– Return earnings to shareholders when higher returns are not
available from acquisition opportunities.
The first component of our strategy is to “live up to our
commitments.” As such, we will continue to make investments
in our businesses to provide reliable services at fair prices. The
second component of our vision is to “perform at world class
levels,”which includes our plan to develop a more fundamental
and durable productivity improvement program to expand on
2002’s Cost Management Initiative.Our process,The Exelon Way,
Management’s Discussion and Analysis of Financial Condition and Results of Operations
exelon corporation and subsidiary companies
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