Exelon 2004 Annual Report Download

Download and view the complete annual report

Please find the complete 2004 Exelon 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

3
realizing the promise
Exelon Corporation 04 Summary Annual Report

Table of contents

  • Page 1
    realizing the promise Exelon Corporation 04 Summary Annual Report 3

  • Page 2
    ... 20 22 23 24 Introduction Letter to Shareholders Realizing our Commitment to Customers Realizing our Commitment to Competition Realizing our Obligation to the Environment Realizing our Commitment to Employees Realizing our Commitment to Shareholders Exelon at a Glance Strategy and Policy Committee...

  • Page 3
    ... exercise disciplined financial management, Exelon can become the best and most consistently profitable electricity and gas company in the United States. We do not claim to have achieved our goal. But we like our chances. And we will not rest until we do. Exelon - pursuing the vision, realizing the...

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

  • Page 5
    ... fuel-producing facilities, losses associated with debt retirements, severance and severance-related charges, accounting changes, charges associated with our investments in Boston Generating and Sithe, and costs associated with the proposed merger with PSEG. In 2004, we had none of the large write...

  • Page 6
    ... Service Enterprise Group. PSEG is a natural partner for Exelon. The two companies enjoy complimentary assets, geography and strategies, and already have a history of partnership. When finally approved by a long list of federal and state agencies, the merger will create the nation's largest utility...

  • Page 7
    ...total program, after-tax cash savings during 2004. Jack Skolds, Frank Clark, Denis O'Brien and Ruth Ann Gillis have been engaged in an all-out effort to bring The Exelon Way to our energy delivery business by adapting and applying the nuclear management model to the wires business by the end of this...

  • Page 8
    ... offer them greater consideration, and more consistent respect, even as we seek to change the work culture. Gary Snodgrass and his HR team are constantly looking for ways to improve employee engagement, to give our employees not only a stake, but even more important a sense of pride, in all that we...

  • Page 9
    ... effective for our customers. And we continue our effort to develop an effective environmental strategy. Our nuclear fleet should be seen as a great asset in a time of tightening environmental requirements. While we are the fourth largest generator nationwide, among our peer group we rank dead last...

  • Page 10
    ...our shareholders. John W. Rowe Chairman, President and CEO Exelon Corporation April 4, 2005 This communication is not a solicitation of a proxy from any security holder of Exelon Corporation or Public Service Enterprise Group Incorporated. Exelon has filed a Registration Statement on Form S-4 with...

  • Page 11
    Exelon strives to build exceptional value - by becoming the best and most consistently profitable electricity and gas company in the United States. To succeed, we must... > Live up to our commitments > Perform at world-class levels > Build value through disciplined financial management 9

  • Page 12
    we promise to keep the lights on >

  • Page 13
    ...to apply the lessons learned in nuclear and finance to our distribution business. We still have much to do, but every day we get better. Exelon will be recognized as a public service leader, the nation's foremost electric and gas utility. While competition has changed the way we price our generation...

  • Page 14
    ..., average rates in our service territories have moderated and even decreased compared to other urban areas, and our shareholders enjoy one of the best total returns in the industry. Competition works. Exelon will be the first truly national utility. As the benefits of competition become more...

  • Page 15
    < we promise to compete for your business

  • Page 16
    we promise to be good stewards >

  • Page 17
    ... and environmental steward. Our accident rate in nuclear and our OSHA recordables in Exelon Energy Delivery are among the best in the industry. And although we rank fourth in overall generation, our large nuclear fleet means we rank last among our peer group in NO X emissions, last in CO 2 emissions...

  • Page 18
    ... well. In a competitive world, a successful company provides a challenging and diverse work environment that develops and encourages employees to be their best. It is also a place where employees are committed to improving productivity, service and customer relations. tomorrow 17,300 Engaging our...

  • Page 19
    < we promise to build a high-performance culture

  • Page 20
    we promise to keep working until we are the finest electric and gas company in the country > John Rowe and Jim Ferland at PSEG headquarters.

  • Page 21
    ... commitment to shareholders...The faces may change, but the Vision remains. Exelon is one Company, with one Vision - to be the finest electric and gas company in the country. today Exelon is one of the most successful utilities in country, with the largest nuclear fleet, a strong balance sheet, and...

  • Page 22
    ... revamped its key leadership in several vital areas of the company, including Customer & Marketing Services and the Work Management Department, to ensure that its focus is on the customer first. exelon generation In 2004, Exelon Generation worked to further integrate its business units, tailoring...

  • Page 23
    ... and PECO, BSC provides Exelon with overall corporate governance services, utility-specific governance of Exelon Energy Delivery's shared functions, and traditional shared services including information technology, supply management, legal services, payroll, accounts payable and employee benefits...

  • Page 24
    ... Chief Operating Officer, Exelon Corporation Pamela B. Strobel Executive Vice President and Chief Administrative Officer, Exelon, and President, Exelon Business Services Company John L. Skolds Executive Vice President, Exelon and President, Exelon Energy Delivery * Oliver D. Kingsley, Jr. retired...

  • Page 25
    ...Richard L. Thomas Retired Chairman, First Chicago NBD Corporation M. Walter D'Alessio Vice Chairman, NorthMarq Capital, Inc. Ronald Rubin Chairman and Chief Executive Officer, Pennsylvania Real Estate Investment Trust Sue L. Gin Chairman and Chief Executive Officer, Flying Food Group, LLC Nelson...

  • Page 26
    ... 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 Reporting...

  • Page 27
    ...the purchase method of accounting with PECO as the acquiring company. Accordingly, financial results for 2000 consist of PECO's results for 2000 and Unicom's results after October 20, 2000. in millions, except for per share data 2004 2003 For the Years Ended December 31, 2002 2001 2000 Statement of...

  • Page 28
    ...'Issues Involved in Accounting for Derivative Contracts Held for Trading Purposes and Contracts Involved in Energy Trading and Risk Management Activities'" (EITF 03-11) in the first quarter of 2004, which changed the presentation of certain power transactions and decreased 2004 operating revenues by...

  • Page 29
    ... amortization expense at Enterprises due to the sale of a majority of its businesses since the third quarter of 2003. Operating Income. Exclusive of the changes in operating revenues, purchased power and fuel expense, the impairment of Boston Generating's long-lived assets, operating and maintenance...

  • Page 30
    ... in Exelon's consolidated financial statements. Transfer of Exelon Energy Company from Enterprises to Generation. Effective January 1, 2004, Enterprises' competitive retail sales business, Exelon Energy Company, was transferred to Generation. The 2003 information related to the Enterprises and...

  • Page 31
    Discussion of Financial Results - Energy Delivery Results of Operations - Energy Delivery in millions 2004 2003 Favorable (Unfavorable) Variance Operating revenues Operating expenses Purchased power and fuel expense Operating and maintenance Depreciation and amortization Taxes other than income ...

  • Page 32
    ..., Exelon Energy Company's results of operations have been included within Generation's results of operations as if this transfer had occurred on January 1, 2003. Favorable (Unfavorable) Variance in millions 2004 2003 Operating revenues Operating expenses Purchased power Fuel Operating and...

  • Page 33
    ...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...

  • Page 34
    Exelon Corporation Consolidated Statements of Income in millions, except per share data For the Years Ended December 31, 2004 2003 2002 Operating revenues Operating expenses Purchased power Purchased power from AmerGen Energy Company, LLC Fuel Impairment of Boston Generating, LLC long-lived ...

  • Page 35
    ... Payment on acquisition note payable to Sithe Energies, Inc. Retirement of preferred stock Dividends paid on common stock Proceeds from employee stock plans Purchase of treasury stock Contribution from minority interest of consolidated subsidiary Other financing activities Net cash flows used in...

  • 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 46 through 130 of Exelon's 2004 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 46 through 130 of Exelon's 2004 Form 10-K filed with the SEC. EXELON CORPORATION AND SUBSIDIARY COMPANIES 35

  • Page 38
    ... Common stock dividends declared Redemption premium on PECO preferred stock Other comprehensive income, net of income taxes of $217 Balance, December 31, 2003 Net income Long-term incentive plan activity Employee stock purchase plan issuances Common stock purchases Common stock dividends declared...

  • 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 46 through 130 of Exelon's 2004 Form 10-K filed with the SEC. EXELON CORPORATION AND SUBSIDIARY COMPANIES 37

  • Page 40
    ... in Internal Control - Integrated Framework issued by the COSO. The full text of PricewaterhouseCoopers LLP's report can be found on pages 132 and 133 of our 2004 Form 10-K. Certifications The CEO of Exelon has made the required annual certification to the New York Stock Exchange (NYSE) that Exelon...

  • Page 41
    ... 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 EquiServe Trust Company, N.A., is Dividend Disbursing Agent, Dividend Reinvestment...

  • Page 42
    Exelon Corporation P.O. Box 805398 Chicago, IL 60680-5398 www.exeloncorp.com ©2005 Exelon