Press release and earnings release attachments

EX-99.1 2 d226315dex991.htm PRESS RELEASE AND EARNINGS RELEASE ATTACHMENTS Press release and earnings release attachments

Exhibit 99.1

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EXELON ANNOUNCES SECOND QUARTER 2016 RESULTS

CHICAGO (August 9, 2016) — Exelon Corporation (NYSE: EXC) announced second quarter 2016 consolidated earnings as follows:


	Second Quarter
	2016		2015
GAAP Results:
Net Income ($ millions)	$	267	$	638
Diluted Earnings per Share	$	0.29	$	0.74

Adjusted (non-GAAP) Operating Results:
Net Income ($ millions)	$	604	$	508
Diluted Earnings per Share	$	0.65	$	0.59

“Our family of companies continued to perform at top levels for our customers, shareholders and communities,” said Christopher M. Crane, Exelon’s President and chief executive officer. “Exelon achieved earnings of $0.65 per share exceeding our guidance range for the second quarter. For the third quarter we are providing a guidance of $0.65 - $0.75 per share and reaffirming our guidance of $2.40 to $2.70 for the full year.”

Second Quarter Operating Results

Exelon’s GAAP Net Income decreased to $0.29 per share in the second quarter of 2016 from $0.74 per share in the second quarter of 2015. Exelon’s adjusted (non-GAAP) Operating Earnings increased to $0.65 per share in the second quarter of 2016 from $0.59 per share in the second quarter of 2015. Earnings in the second quarter of 2016 primarily reflect the following favorable factors:

•

Higher utility earnings due to favorable impacts of regulatory rate increases; and

•

Higher revenue at Generation under the Reliability Support Services Agreement approved in the second quarter of 2016 for Ginna for periods retroactive to April 1, 2015.

These factors were partially offset by:

•

Higher operating and maintenance costs at BGE due to charges for certain disallowances contained in the June and July 2016 MDPSC rate case orders;

•

Higher operating and maintenance costs at Generation, which includes the impact of the timing and extended duration of an outage at the Salem nuclear power plant;

•

Higher nuclear decommissioning amortization at Generation; and

•

Lower realized NDT fund investment gains at Generation.

Second quarter 2016 results also include $0.06 per share of PHI GAAP and Adjusted (non-GAAP) Operating Earnings, the impact of which was fully offset by the incremental debt and equity costs incurred in connection with the merger.

Adjusted (non-GAAP) Operating Earnings for the second quarter of 2016 do not include the following items (after tax) that were included in reported GAAP Net Income:


	(in millions)			(per diluted share)
Exelon GAAP Net Income	$	267		$	0.29
Mark-to-Market Impact of Economic Hedging Activities		185			0.20
Unrealized Gains Related to NDT Fund Investments		(27	)		(0.03	)
Amortization of Commodity Contract Intangibles		8			0.01
Merger and Integration Costs		1			—
Merger Commitments		1			—
Long-Lived Asset Impairments		22			0.02
Plant Retirements and Divestitures		133			0.14
Cost Management Program		6			0.01
CENG Non-Controlling Interest		8			0.01

Exelon Adjusted (non-GAAP) Operating Earnings	$	604		$	0.65

Adjusted (non-GAAP) Operating Earnings for the second quarter of 2015 do not include the following items (after tax) that were included in reported GAAP Net Income:


	(in millions)			(per diluted share)
Exelon GAAP Net Income	$	638		$	0.74
Mark-to-Market Impact of Economic Hedging Activities		(143	)		(0.16	)
Unrealized Losses Related to NDT Fund Investments		56			0.06
Amortization of Commodity Contract Intangibles		9			0.01
Merger and Integration Costs		18			0.02
Mark-to-Market Impact of PHI Merger Related Interest Rate Swap		(71	)		(0.08	)
Long-Lived Asset Impairments		15			0.02
CENG Non-Controlling Interest		(14	)		(0.02	)

Exelon Adjusted (non-GAAP) Operating Earnings	$	508		$	0.59

Second Quarter and Recent Highlights

•

Early Retirement of Clinton and Quad Cities Nuclear Facilities: On June 2, 2016, Generation announced it will move forward to shut down the Clinton and Quad Cities nuclear plants on June 1, 2017 and June 1, 2018, respectively. As a result, Exelon and Generation recognized one-time charges in GAAP Operating and maintenance expense of $141 million related to materials and supplies inventory reserve adjustments, employee-related costs and construction work-in-progress impairments, among other items. Additionally, Exelon and Generations’ second quarter 2016 GAAP operating results include an incremental $110 million of pre-tax expense primarily related to accelerated depreciation of plant assets, accelerated amortization of nuclear fuel, and additional asset retirement obligation accretion expense associated with the changes in decommissioning timing and cost assumptions. These amounts have been excluded from GAAP Net Income to arrive at Adjusted (non-GAAP) Operating Earnings.

•

BGE Electric and Natural Gas Distribution Rate Case: In the June and July 2016 rate case orders, the MDPSC authorized electric and natural gas rate increases of $44 million and $48 million, respectively, and allowed ROEs for BGE’s electric and natural gas distribution businesses of 9.75 percent and 9.65 percent, respectively. The new rates took effect for service rendered on or after June 4, 2016. While the MDPSC found compelling evidence to conclude that BGE’s smart grid initiative overall was cost beneficial to customers, the final order contained several cost disallowances and adjustments precluding BGE from recovering the full amount of costs it has incurred and invested in the smart grid initiative. As a result, BGE recorded an $52 million charge to Operating and maintenance expense in the second quarter.

•

Proposed Acquisition of ConEdison Solutions: On July 27, 2016, Generation entered into an Asset Purchase Agreement with ConEdison Solutions, a

subsidiary of Consolidated Edison, Inc. Pursuant to the Purchase Agreement, ConEdison Solutions agreed to sell its competitive retail electric and natural gas business to Generation for an all cash purchase price of $53 million plus estimated purchase price adjustments, including net working capital, of $130 million. The transaction is expected to close in the third or fourth quarter of 2016. The closing of the transaction is subject to certain conditions, including, obtaining the termination or expiration of any applicable waiting period required under the HSR Act for the consummation of the transaction.

•

New York Clean Energy Standard: On August 1, 2016, the Clean Energy Standard (CES) was approved by the NYPSC, a component of which includes creation of a Tier 3 Zero Emission Credit program targeted at preserving the environmental attributes of zero-emissions nuclear-powered generating facilities that meet the criteria demonstrating public necessity as determined by the NYPSC. Subject to the Ginna and Nine Mile Point nuclear power plants entering into satisfactory contracts with the New York State Energy Research & Development Agency, as required under the CES, and subject to any potential administrative or legal challenges, the CES will allow Ginna and Nine Mile Point to continue to operate at least through the life of the program (March 31, 2029). The duration of the program beyond April 1, 2019 is conditional upon a buyer purchasing the James A. FitzPatrick nuclear generating station and taking title prior to September 1, 2018.

•

Nuclear Operations: Generation’s nuclear fleet, including its owned output from the Salem Generating Station and 100 percent of the CENG units, produced 42,453 gigawatt-hours (GWh) in the second quarter of 2016, compared with 43,805 GWh in the second quarter of 2015. Excluding Salem, the Exelon-operated nuclear plants at ownership achieved a 92.3 percent capacity factor for the second quarter of 2016, compared with 93.1 percent for the second quarter of 2015. The number of planned refueling outage days in the second quarter of 2016 totaled 87, compared with 71 in the second quarter of 2015. There were 21 non-refueling outage days in the second quarter of 2016, compared with 18 days in the second quarter of 2015.

•

Fossil and Renewables Operations: The Dispatch Match rate for Generation’s gas and hydro fleet was 97.4 percent in the second quarter of 2016, compared with 99.2 percent in the second quarter of 2015. The lower performance in the quarter was primarily due to an unplanned outage in April at Wolf Hollow, in Texas. Energy Capture for the wind and solar fleet was 95.5 percent in the second quarter of 2016, compared with 96.1 percent in the second quarter of 2015. The lower performance was attributed to minor mechanical issues across the fleet.

•

Pepco District of Columbia Electric Distribution Rate Case: On June 30, 2016, Pepco filed an application with the DCPSC requesting an increase of $86 million to its annual service revenues for electric delivery, based on a requested ROE of 10.6 percent. Any adjustments to rates approved by the DCPSC are expected to take effect in June 2017.

•

DPL Maryland Electric Distribution Rate Case: On July 20, 2016, DPL filed an application with the MDPSC requesting an increase of $66 million to its electric distribution base rates, based on a requested ROE of 10.6 percent. Any adjustments to rates approved by the MDPSC are expected to take effect in February 2017.

•

DPL Delaware Electric and Natural Gas Distribution Rate Case: On May 17, 2016, DPL filed an application with the DPSC requesting an increase of $63 million and $22 million to its electric and natural gas distribution base rates, based on a requested ROE of 10.6 percent. While the DPSC is not required to issue a decision on the application within a specified period time, Delaware law allows DPL to put into effect $2.5 million of the rate increase two months after filing the application and the entire requested rate increase seven months after filing, subject to a cap and a refund obligation based on the final DPSC order.

•

BGE Preference Stock Redemption: BGE has $190 million of cumulative preference stock that are redeemable at its option at any time for the redemption price of $100 per share, plus accrued and unpaid dividends. On July 3, 2016, BGE redeemed all 400,000 shares of its outstanding 7.125 percent Cumulative Preference Stock, 1993 Series and all 600,000 shares of its outstanding 6.99 percent Cumulative Preference Stock, 1995 Series for $100 million, plus accrued and unpaid dividends. Following these redemptions, BGE has $90 million remaining of cumulative preference stock outstanding.

•

Financing Activities:

•

On May 26, 2016, Exelon Corporate, Generation, ComEd, PECO and BGE entered into amendments to each of their respective syndicated revolving credit facilities, which extended the maturity of each of the facilities to May 26, 2021. Exelon Corporate also increased the size of its facility from $500 million to $600 million. In addition, PHI, Pepco, DPL and ACE entered into an amendment to their Second Amended and Restated Credit Agreement which extended the maturity date of the facility to May 26, 2021, removed PHI as a borrower under the facility and decreased the size of the facility from $1.5 billion to $900 million.

•

On June 27, 2016, ComEd issued $500 million in aggregate principal amount of its First Mortgage Bonds, 2.550 percent Series due June 15, 2026 and $700 million in aggregate principal amount of its First Mortgage Bonds, 3.650 percent Series due June 15, 2046. The net proceeds from sale of the bonds will be used to refinance maturing mortgage bonds, repay a portion of ComEd’s outstanding commercial paper obligations and for general corporate purposes.

•

Hedging Update: Exelon’s hedging program involves the hedging of commodity risk for Exelon’s expected generation, typically on a ratable basis over a three-year period. The proportion of expected generation hedged as of June 30, 2016, is 97.0 percent to 100.0 percent for 2016, 78.0 percent to 81.0 percent for 2017, and 47.0 percent to 50.0 percent for 2018. Expected generation is the volume of energy that best represents our financial exposure through owned or

contracted capacity. The primary objective of Exelon’s hedging program is to manage market risks and protect the value of its generation and its investment-grade balance sheet, while preserving its ability to participate in improving long-term market fundamentals.

Operating Company Results

ComEd consists of electricity transmission and distribution operations in Northern Illinois.

ComEd’s second quarter 2016 GAAP Net Income was $145 million compared with $99 million in the second quarter of 2015. Adjusted (non-GAAP) Operating Earnings for the second quarter of 2016 and 2015 do not include merger and integration costs that were included in reported GAAP earnings. A reconciliation of GAAP Net Income to Adjusted (non-GAAP) Operating Earnings is presented in the table below:


($ millions)	2Q16		2Q15
ComEd GAAP Net Income	$	145	$	99
Merger and Integration Costs		1		2

ComEd Adjusted (non-GAAP) Operating Earnings	$	146	$	101

ComEd’s Adjusted (non-GAAP) Operating Earnings in the second quarter of 2016 increased by $45 million from the same quarter in 2015, primarily due to higher electric distribution and transmission formula rate earnings and favorable weather.

For the second quarter of 2016, heating degree-days in the ComEd service territory were up 10.1 percent relative to the same period in 2015 and were 1.3 percent below normal. Cooling degree days were up 69.6 percent relative to the same period in 2015 and were 33.0 percent above normal. Total retail deliveries increased by 4.3 percent in the second quarter of 2016 compared with the same period in 2015.

Weather-normalized retail electric deliveries remained relatively consistent in the second quarter of 2016 compared with the same period in 2015.

PECO consists of electricity transmission and distribution operations and retail natural gas distribution operations in Southeastern Pennsylvania.

PECO’s second quarter 2016 GAAP Net Income was $100 million compared with $70 million in the second quarter of 2015. Adjusted (non-GAAP) Operating Earnings for the second quarter of 2016 and 2015 do not include certain items (after tax) that were included in reported GAAP earnings. A reconciliation of GAAP Net Income to Adjusted (non-GAAP) Operating Earnings is presented in the table below:


($ millions)	2Q16		2Q15
PECO GAAP Net Income	$	100	$	70
Merger and Integration Costs		—		1
Cost Management Program		1		—

PECO Adjusted (non-GAAP) Operating Earnings	$	101	$	71

PECO’s Adjusted (non-GAAP) Operating Earnings in the second quarter of 2016 increased by $30 million from the same quarter in 2015, primarily due to increased electric distribution revenue pursuant to a rate increase effective January 1, 2016 and the impact of a cumulative tax adjustment related to an anticipated gas repairs tax return accounting method change.

For the second quarter of 2016, heating degree-days in the PECO service territory were up 42.1 percent relative to the same period in 2015 and were 0.6 percent above normal. Cooling degree days were down 23.8 percent relative to the same period in 2015 and were 12.4 percent above normal. Total retail electric deliveries were down 1.9 percent compared with the second quarter of 2015. Natural gas deliveries (including both retail and transportation segments) in the second quarter of 2016 were up 8.9 percent compared with the same period in 2015.

Weather-normalized retail electric deliveries remained relatively consistent while gas deliveries decreased 1.5 percent in the second quarter of 2016 compared with the same period in 2015. The decreased gas volumes were driven primarily by lower use per customer.

BGE consists of electricity transmission and distribution operations and retail natural gas distribution operations in Central Maryland.

BGE’s second quarter 2016 GAAP Net Income was $31 million compared with $44 million in the second quarter of 2015. Adjusted (non-GAAP) Operating Earnings for the second quarter of 2016 and 2015 do not include certain items (after tax) that were included in reported GAAP earnings. A reconciliation of GAAP Net Income to Adjusted (non-GAAP) Operating Earnings is presented in the table below:


($ millions)	2Q16			2Q15
BGE GAAP Net Income	$	31		$	44
Merger and Integration Costs		(3	)		1
Cost Management Program		1			—

BGE Adjusted (non-GAAP) Operating Earnings	$	29		$	45

BGE’s Adjusted (non-GAAP) Operating Earnings in the second quarter of 2016 decreased $16 million from the same quarter in 2015, primarily due to charges for certain disallowances contained in the June and July 2016 rate orders and increased underground conduit rental fees assessed by the City of Baltimore, partially offset by increased transmission revenue due to increased capital investments and operating and maintenance expense recoveries and increased distribution revenue pursuant to increased rates effective in June 2016. Due to revenue decoupling, BGE is not affected by actual weather with the exception of major storms.

PHI consists of electricity transmission and distribution operations in the District of Columbia and portions of Maryland, Delaware, and New Jersey and retail natural gas distribution operations in northern Delaware.

PHI’s second quarter 2016 GAAP Net Income was $52 million. Adjusted (non-GAAP) Operating Earnings do not include merger commitments that were included in reported GAAP earnings. A reconciliation of GAAP Net Income to (after-tax) Adjusted (non-GAAP) Operating Earnings is presented in the table below:


($ millions)	2Q16
PHI GAAP Net Income	$	52
Merger Commitments		1

PHI Adjusted (non-GAAP) Operating Earnings	$	53

Generation consists of owned and contracted electric generating facilities and wholesale and retail customer supply of electric and natural gas products and services, including renewable energy products, risk management services and natural gas exploration and production activities.

Generation’s second quarter 2016 GAAP Net Loss was $8 million compared with GAAP Net Income of $398 million in the second quarter of 2015. Adjusted (non-GAAP) Operating Earnings for the second quarter of 2016 and 2015 do not include various items (after tax) that were included in reported GAAP earnings. A reconciliation of GAAP Net Income to Adjusted (non-GAAP) Operating Earnings is presented in the table below:


($ millions)	2Q16			2Q15
Generation GAAP Net (Loss) Income	$	(8	)	$	398
Mark-to-Market Impact of Economic Hedging Activities		185			(145	)
Unrealized (Gains) Losses Related to NDT Fund Investments		(27	)		56
Amortization of Commodity Contract Intangibles		8			9
Merger and Integration Costs		3			5
Long-Lived Asset Impairments		22			—
Plant Retirements and Divestitures		133			—
Cost Management Program		4			—
CENG Non-Controlling Interest		8			(14	)

Generation Adjusted (non-GAAP) Operating Earnings	$	328		$	309

Generation’s Adjusted (non-GAAP) Operating Earnings in the second quarter of 2016 increased by $19 million compared with the same quarter in 2015. This increase primarily reflects higher revenue under the Reliability Support Services Agreement approved in the second quarter of 2016 for Ginna for periods retroactive to April 1, 2015, mostly offset by the impacts of the timing and extended duration of an outage at the Salem nuclear power plant, lower realized gains on nuclear decommissioning trust funds, and increased nuclear decommissioning amortization expense.

Non-GAAP Financial Measures

In addition to net income as determined under generally accepted accounting principles in the United States (GAAP), Exelon evaluates its operating performance using the measure of adjusted (non-GAAP) operating earnings because management believes it represents earnings directly related to the ongoing operations of the business. Adjusted (non-GAAP) operating earnings exclude certain costs, expenses, gains and losses and other specified items. This information is intended to enhance an investor’s overall understanding of period over period operating results and provide an indication of Exelon’s baseline operating performance excluding items that are considered by management to be not directly related to the ongoing operations of the business. In addition, this information is among the primary indicators management uses as a basis for evaluating performance, allocating resources, setting incentive compensation targets and planning and forecasting of future periods. Adjusted (non-GAAP) operating earnings is not a presentation defined under GAAP and may not be comparable to other companies’ presentation. The Company has provided the non-GAAP financial measure as supplemental information and in addition to the financial measures that are calculated and presented in accordance with GAAP. Adjusted (non-GAAP) operating earnings should not be deemed more useful than, a substitute for, or an alternative to the most comparable GAAP measures provided in this earnings release and attachments. This press release and earnings release attachments provide reconciliations of adjusted (non-GAAP) operating earnings to the most directly comparable financial measures calculated and presented in accordance with GAAP, are posted on Exelon’s website: www.exeloncorp.com, and have been furnished to the Securities and Exchange Commission on Form 8-K on August 9, 2016.

Cautionary Statements Regarding Forward-Looking Information

This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, that are subject to risks and uncertainties. The factors that could cause actual results to differ materially from the forward-looking statements made by Exelon Corporation, Exelon Generation Company, LLC, Commonwealth Edison Company, PECO Energy Company, Baltimore Gas and Electric Company, Pepco Holdings LLC (PHI), Potomac Electric Power Company, Delmarva Power & Light Company, and Atlantic City Electric Company (Registrants) include those factors discussed herein, as well as the items discussed in (1) Exelon’s 2015 Annual Report on Form 10-K in (a) ITEM 1A. Risk Factors, (b) ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and (c) ITEM 8. Financial Statements and Supplementary Data: Note 23; (2) PHI’s 2015 Annual Report on Form 10-K in (a) ITEM 1A. Risk Factors, (b) ITEM 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations and (c) ITEM 8. Financial Statements and Supplementary Data: Note 16; (3) Exelon’s Second Quarter 2016 Quarterly Report on Form 10-Q in (a) Part II, Other Information, ITEM 1A. Risk Factors; (b) Part 1, Financial Information, ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations and (c) Part I, Financial Information, ITEM 1. Financial Statements: Note 18 and (4) other factors discussed in filings with the SEC by the Registrants.

Readers are cautioned not to place undue reliance on these forward-looking statements, which apply only as of the date of this press release. None of the Registrants undertakes any obligation to publicly release any revision to its forward-looking statements to reflect events or circumstances after the date of this press release.

# # #

Exelon Corporation (NYSE: EXC) is a Fortune 100 energy company with the largest number of utility customers in the U.S. Exelon does business in 48 states, the District of Columbia and Canada and had 2015 revenue of $34.5 billion. Exelon’s six utilities deliver electricity and natural gas to approximately 10 million customers in Delaware, the District of Columbia, Illinois, Maryland, New Jersey and Pennsylvania through its Atlantic City Electric, BGE, ComEd, Delmarva Power, PECO and Pepco subsidiaries. Exelon is one of the largest competitive U.S. power generators, with more than 32,700 megawatts of nuclear, gas, wind, solar and hydroelectric generating capacity comprising one of the nation’s cleanest and lowest-cost power generation fleets. The company’s Constellation business unit provides energy products and services to approximately 2 million residential, public sector and business customers, including more than two-thirds of the Fortune 100. Follow Exelon on Twitter @Exelon.

Earnings Release Attachments

Table of Contents


Consolidating Statements of Operations - three months ended June 30, 2016 and 2015			1

Consolidating Statements of Operations - six months ended June 30, 2016 and 2015			2

Business Segment Comparative Statements of Operations - Generation and ComEd - three and six months ended June 30, 2016 and 2015			3

Business Segment Comparative Statements of Operations - PECO and BGE - three and six months ended June 30, 2016 and 2015			4

Business Segment Comparative Statements of Operations - PHI and Other - three and six months ended June 30, 2016 and 2015			5

Consolidated Balance Sheets - June 30, 2016 and December 31, 2015			6

Consolidated Statements of Cash Flows - six months ended June 30, 2016 and 2015			7

Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations - Exelon - three months ended June 30, 2016 and 2015			8

Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations - Exelon - six months ended June 30, 2016 and 2015			10

Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Earnings By Business Segment - three months ended June 30, 2016 and 2015			12

Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Earnings By Business Segment - six months ended June 30, 2016 and 2015			14

Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations - Generation - three and six months ended June 30, 2016 and 2015			16

Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations - ComEd - three and six months ended June 30, 2016 and 2015			18

Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations - PECO - three and six months ended June 30, 2016 and 2015			19

Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations - BGE - three and six months ended June 30, 2016 and 2015			20

Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statement of Operations - PHI - three and six months ended June 30, 2016 and 2015			21

Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations - Other - three and six months ended June 30, 2016 and 2015			22

Exelon Generation Statistics - three months ended June 30, 2016, March 31, 2016, December 31, 2015, September 30, 2015 and June 30, 2015			24

Exelon Generation Statistics - six months ended June 30, 2016 and 2015			25

ComEd Statistics - three and six months ended June 30, 2016 and 2015			26

PECO Statistics - three and six months ended June 30, 2016 and 2015			27

BGE Statistics - three and six months ended June 30, 2016 and 2015			29

Pepco Statistics - three and six months ended June 30, 2016 and 2015			31

DPL Statistics - three and six months ended June 30, 2016 and 2015			32

ACE Statistics - three and six months ended June 30, 2016 and 2015			34

EXELON CORPORATION

Consolidating Statements of Operations

(unaudited)

(in millions)


	Three Months Ended June 30, 2016
	Generation			ComEd			PECO			BGE			PHI (a)			Other (b)			Exelon Consolidated
Operating revenues	$	3,589		$	1,286		$	664		$	680		$	1,066		$	(375	)	$	6,910
Operating expenses
Purchased power and fuel		1,577			339			217			261			416			(356	)		2,454
Operating and maintenance		1,530			368			190			208			246			(37	)		2,505
Depreciation and amortization		408			190			67			97			160			19			941
Taxes other than income		118			65			38			55			108			10			394

Total operating expenses		3,633			962			512			621			930			(364	)		6,294
Gain on sales of assets		31			—			—			—			—			—			31

Operating (loss) income		(13	)		324			152			59			136			(11	)		647

Other income and (deductions)
Interest expense, net		(99	)		(91	)		(31	)		(24	)		(66	)		(65	)		(376	)
Other, net		117			3			2			5			11			6			144

Total other income and (deductions)		18			(88	)		(29	)		(19	)		(55	)		(59	)		(232	)

Income (loss) before income taxes		5			236			123			40			81			(70	)		415
Income taxes		(31	)		91			23			6			29			(16	)		102
Equity in (losses) earnings of unconsolidated affiliates		(8	)		—			—			—			—			1			(7	)

Net income (loss)		28			145			100			34			52			(53	)		306

Net income attributable to noncontrolling interests and preference stock dividends		36			—			—			3			—			—			39

Net (loss) income attributable to common shareholders	$	(8	)	$	145		$	100		$	31		$	52		$	(53	)	$	267


	Three Months Ended June 30, 2015
	Generation			ComEd			PECO			BGE			PHI (a)			Other (b)			Exelon Consolidated
Operating revenues	$	4,232		$	1,148		$	661		$	628		$	—		$	(155	)	$	6,514
Operating expenses
Purchased power and fuel		1,849			275			237			239			—			(151	)		2,449
Operating and maintenance		1,308			384			192			149			—			9			2,042
Depreciation and amortization		255			177			69			87			—			14			602
Taxes other than income		124			69			39			54			—			8			294

Total operating expenses		3,536			905			537			529			—			(120	)		5,387
Gain on sales of assets		7			—			—			—			—			—			7

Operating income (loss)		703			243			124			99			—			(35	)		1,134

Other income and (deductions)
Interest expense, net		(99	)		(81	)		(28	)		(24	)		—			77			(155	)
Other, net		(31	)		5			1			4			—			4			(17	)

Total other income and (deductions)		(130	)		(76	)		(27	)		(20	)		—			81			(172	)

Income before income taxes		573			167			97			79			—			46			962
Income taxes		181			68			27			32			—			19			327
Equity in losses of unconsolidated affiliates		(2	)		—			—			—			—			—			(2	)

Net income		390			99			70			47			—			27			633

Net (loss) income attributable to noncontrolling interests and preference stock dividends		(8	)		—			—			3			—			—			(5	)

Net income attributable to common shareholders	$	398		$	99		$	70		$	44		$	—		$	27		$	638

(a)	PHI includes the consolidated results of Potomac Electric Power Company, Delmarva Power & Light Company, and Atlantic City Electric Company from April 1, 2016 to June 30, 2016.

(b)	Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities and other financing and investment activities.

EXELON CORPORATION

Consolidating Statements of Operations

(unaudited)

(in millions)


	Six Months Ended June 30, 2016
	Generation			ComEd			PECO			BGE			PHI (a)			Other (b)			Exelon Consolidated
Operating revenues	$	8,329		$	2,535		$	1,505		$	1,609		$	1,171		$	(664	)	$	14,485
Operating expenses
Purchased power and fuel		4,020			686			537			634			454			(623	)		5,708
Operating and maintenance		2,997			736			405			410			695			98			5,341
Depreciation and amortization		697			379			134			206			174			36			1,626
Taxes other than income		244			141			80			114			123			18			720

Total operating expenses		7,958			1,942			1,156			1,364			1,446			(471	)		13,395
Gain on sales of assets		31			5			—			—			—			4			40

Operating income (loss)		402			598			349			245			(275	)		(189	)		1,130

Other income and (deductions)
Interest expense, net		(196	)		(177	)		(62	)		(48	)		(71	)		(109	)		(663	)
Other, net		210			7			4			11			12			14			258

Total other income and (deductions)		14			(170	)		(58	)		(37	)		(59	)		(95	)		(405	)

Income (loss) before income taxes		416			428			291			208			(334	)		(284	)		725
Income taxes		120			168			67			73			(77	)		(66	)		285
Equity in (losses) earnings of unconsolidated affiliates		(11	)		—			—			—			—			1			(10	)

Net income (loss)		285			260			224			135			(257	)		(217	)		430

Net (loss) income attributable to noncontrolling interests and preference stock dividends		(17	)		—			—			6			—			1			(10	)

Net income (loss) attributable to common shareholders	$	302		$	260		$	224		$	129		$	(257	)	$	(218	)	$	440


	Six Months Ended June 30, 2015
	Generation			ComEd			PECO			BGE			PHI (a)			Other (b)			Exelon Consolidated
Operating revenues	$	10,074		$	2,333		$	1,646		$	1,664		$	—		$	(372	)	$	15,345
Operating expenses
Purchased power and fuel		5,282			601			675			726			—			(365	)		6,919
Operating and maintenance		2,619			762			414			331			—			(3	)		4,123
Depreciation and amortization		509			352			131			192			—			28			1,212
Taxes other than income		246			146			80			111			—			15			598

Total operating expenses		8,656			1,861			1,300			1,360			—			(325	)		12,852
Gain on sales of assets		6			—			1			—			—			1			8

Operating income (loss)		1,424			472			347			304			—			(46	)		2,501

Other income and (deductions)
Interest expense, net		(201	)		(165	)		(56	)		(50	)		—			(29	)		(501	)
Other, net		62			9			3			8			—			(18	)		64

Total other income and (deductions)		(139	)		(156	)		(53	)		(42	)		—			(47	)		(437	)

Income (loss) before income taxes		1,285			316			294			262			—			(93	)		2,064
Income taxes		407			127			85			105			—			(34	)		690
Equity in (losses) earnings of unconsolidated affiliates		(3	)		—			—			—			—			1			(2	)

Net income (loss)		875			189			209			157			—			(58	)		1,372

Net income attributable to noncontrolling interests and preference stock dividends		34			—			—			6			—			1			41

Net income (loss) attributable to common shareholders	$	841		$	189		$	209		$	151		$	—		$	(59	)	$	1,331

(a)	PHI includes the consolidated results of Potomac Electric Power Company, Delmarva Power & Light Company, and Atlantic City Electric Company from March 24, 2016 to June 30, 2016.

(b)	Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities and other financing and investment activities.

EXELON CORPORATION

Business Segment Comparative Statements of Operations

(unaudited)

(in millions)


	Generation
	Three Months Ended June 30,									Six Months Ended June 30,
	2016			2015			Variance			2016			2015			Variance
Operating revenues	$	3,589		$	4,232		$	(643	)	$	8,329		$	10,074		$	(1,745	)
Operating expenses
Purchased power and fuel		1,577			1,849			(272	)		4,020			5,282			(1,262	)
Operating and maintenance		1,530			1,308			222			2,997			2,619			378
Depreciation and amortization		408			255			153			697			509			188
Taxes other than income		118			124			(6	)		244			246			(2	)

Total operating expenses		3,633			3,536			97			7,958			8,656			(698	)
Gain on sales of assets		31			7			24			31			6			25

Operating (loss) income		(13	)		703			(716	)		402			1,424			(1,022	)

Other income and (deductions)
Interest expense, net		(99	)		(99	)		—			(196	)		(201	)		5
Other, net		117			(31	)		148			210			62			148

Total other income and (deductions)		18			(130	)		148			14			(139	)		153

Income before income taxes		5			573			(568	)		416			1,285			(869	)
Income taxes		(31	)		181			(212	)		120			407			(287	)
Equity in losses of unconsolidated affiliates		(8	)		(2	)		(6	)		(11	)		(3	)		(8	)

Net income		28			390			(362	)		285			875			(590	)

Net income (loss) attributable to noncontrolling interests and preference stock dividends		36			(8	)		44			(17	)		34			(51	)

Net (loss) income attributable to membership interest	$	(8	)	$	398		$	(406	)	$	302		$	841		$	(539	)


	ComEd
	Three Months Ended June 30,									Six Months Ended June 30,
	2016			2015			Variance			2016			2015			Variance
Operating revenues	$	1,286		$	1,148		$	138		$	2,535		$	2,333		$	202
Operating expenses
Purchased power		339			275			64			686			601			85
Operating and maintenance		368			384			(16	)		736			762			(26	)
Depreciation and amortization		190			177			13			379			352			27
Taxes other than income		65			69			(4	)		141			146			(5	)

Total operating expenses		962			905			57			1,942			1,861			81
Gain on sales of assets		—			—			—			5			—			5

Operating income		324			243			81			598			472			126

Other income and (deductions)
Interest expense, net		(91	)		(81	)		(10	)		(177	)		(165	)		(12	)
Other, net		3			5			(2	)		7			9			(2	)

Total other income and (deductions)		(88	)		(76	)		(12	)		(170	)		(156	)		(14	)

Income before income taxes		236			167			69			428			316			112
Income taxes		91			68			23			168			127			41

Net income	$	145		$	99		$	46		$	260		$	189		$	71

EXELON CORPORATION

Business Segment Comparative Statements of Operations

(unaudited)

(in millions)


	PECO
	Three Months Ended June 30,									Six Months Ended June 30,
	2016			2015			Variance			2016			2015			Variance
Operating revenues	$	664		$	661		$	3		$	1,505		$	1,646		$	(141	)
Operating expenses
Purchased power and fuel		217			237			(20	)		537			675			(138	)
Operating and maintenance		190			192			(2	)		405			414			(9	)
Depreciation and amortization		67			69			(2	)		134			131			3
Taxes other than income		38			39			(1	)		80			80			—

Total operating expenses		512			537			(25	)		1,156			1,300			(144	)
Gain on sales of assets		—			—			—			—			1			(1	)

Operating income		152			124			28			349			347			2

Other income and (deductions)
Interest expense, net		(31	)		(28	)		(3	)		(62	)		(56	)		(6	)
Other, net		2			1			1			4			3			1

Total other income and (deductions)		(29	)		(27	)		(2	)		(58	)		(53	)		(5	)

Income before income taxes		123			97			26			291			294			(3	)
Income taxes		23			27			(4	)		67			85			(18	)

Net income attributable to common shareholder	$	100		$	70		$	30		$	224		$	209		$	15


	BGE
	Three Months Ended June 30,									Six Months Ended June 30,
	2016			2015			Variance			2016			2015			Variance
Operating revenues	$	680		$	628		$	52		$	1,609		$	1,664		$	(55	)
Operating expenses
Purchased power and fuel		261			239			22			634			726			(92	)
Operating and maintenance		208			149			59			410			331			79
Depreciation and amortization		97			87			10			206			192			14
Taxes other than income		55			54			1			114			111			3

Total operating expenses		621			529			92			1,364			1,360			4

Operating income		59			99			(40	)		245			304			(59	)

Other income and (deductions)
Interest expense, net		(24	)		(24	)		—			(48	)		(50	)		2
Other, net		5			4			1			11			8			3

Total other income and (deductions)		(19	)		(20	)		1			(37	)		(42	)		5

Income before income taxes		40			79			(39	)		208			262			(54	)
Income taxes		6			32			(26	)		73			105			(32	)

Net income		34			47			(13	)		135			157			(22	)

Preference stock dividends		3			3			—			6			6			—

Net income attributable to common shareholder	$	31		$	44		$	(13	)	$	129		$	151		$	(22	)

EXELON CORPORATION

Business Segment Comparative Statements of Operations

(unaudited)

(in millions)


	PHI (a)
	Three Months Ended June 30,									Six Months Ended June 30,
	2016			2015			Variance			2016			2015			Variance
Operating revenues	$	1,066		$	—		$	1,066		$	1,171		$	—		$	1,171
Operating expenses
Purchased power and fuel		416			—			416			454			—			454
Operating and maintenance		246			—			246			695			—			695
Depreciation and amortization		160			—			160			174			—			174
Taxes other than income		108			—			108			123			—			123

Total operating expenses		930			—			930			1,446			—			1,446

Operating income (loss)		136			—			136			(275	)		—			(275	)

Other income and (deductions)
Interest expense, net		(66	)		—			(66	)		(71	)		—			(71	)
Other, net		11			—			11			12			—			12

Total other income and (deductions)		(55	)		—			(55	)		(59	)		—			(59	)

Income (loss) before income taxes		81			—			81			(334	)		—			(334	)
Income taxes		29			—			29			(77	)		—			(77	)

Net income (loss)	$	52		$	—		$	52		$	(257	)	$	—		$	(257	)


	Other (b)
	Three Months Ended June 30,									Six Months Ended June 30,
	2016			2015			Variance			2016			2015			Variance
Operating revenues	$	(375	)	$	(155	)	$	(220	)	$	(664	)	$	(372	)	$	(292	)
Operating expenses
Purchased power and fuel		(356	)		(151	)		(205	)		(623	)		(365	)		(258	)
Operating and maintenance		(37	)		9			(46	)		98			(3	)		101
Depreciation and amortization		19			14			5			36			28			8
Taxes other than income		10			8			2			18			15			3

Total operating expenses		(364	)		(120	)		(244	)		(471	)		(325	)		(146	)
Gain on sales of assets		—			—			—			4			1			3

Operating loss		(11	)		(35	)		24			(189	)		(46	)		(143	)

Other income and (deductions)
Interest expense, net		(65	)		77			(142	)		(109	)		(29	)		(80	)
Other, net		6			4			2			14			(18	)		32

Total other income and (deductions)		(59	)		81			(140	)		(95	)		(47	)		(48	)

Loss before income taxes		(70	)		46			(116	)		(284	)		(93	)		(191	)
Income taxes		(16	)		19			(35	)		(66	)		(34	)		(32	)
Equity in earnings of unconsolidated affiliates		1			—			1			1			1			—

Net (loss) income		(53	)		27			(80	)		(217	)		(58	)		(159	)

Net income attributable to noncontrolling interests and preference stock dividends		—			—			—			1			1			—

Net (loss) income attributable to common shareholders	$	(53	)	$	27		$	(80	)	$	(218	)	$	(59	)	$	(159	)

(a)	PHI includes the consolidated results of Potomac Electric Power Company, Delmarva Power & Light Company, and Atlantic City Electric Company from March 24, 2016 to June 30, 2016 for six months ended and April 1, 2016 to June 30, 2016 for three months ended. Exelon did not own PHI in 2015.

(b)	Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities and other financing and investment activities.

EXELON CORPORATION

Consolidated Balance Sheets


(in millions)	June 30, 2016			December 31, 2015
(in millions)	(unaudited)
Assets
Current assets
Cash and cash equivalents	$	1,647		$	6,502
Restricted cash and cash equivalents		201			205
Accounts receivable, net
Customer		3,671			3,187
Other		988			912
Mark-to-market derivative assets		759			1,365
Unamortized energy contract assets		69			86
Inventories, net
Fossil fuel and emission allowances		317			462
Materials and supplies		1,183			1,104
Regulatory assets		1,559			759
Other		1,101			752

Total current assets		11,495			15,334

Property, plant and equipment, net		70,693			57,439
Deferred debits and other assets
Regulatory assets		10,121			6,065
Nuclear decommissioning trust funds		10,737			10,342
Investments		502			639
Goodwill		6,696			2,672
Mark-to-market derivative assets		546			758
Unamortized energy contracts assets		461			484
Pledged assets for Zion Station decommissioning		161			206
Other		1,366			1,445

Total deferred debits and other assets		30,590			22,611

Total assets	$	112,778		$	95,384

Liabilities and shareholders’ equity
Current liabilities
Short-term borrowings	$	951		$	533
Long-term debt due within one year		2,693			1,500
Accounts payable		2,826			2,883
Accrued expenses		2,757			2,376
Payables to affiliates		8			8
Regulatory liabilities		503			369
Mark-to-market derivative liabilities		152			205
Unamortized energy contract liabilities		508			100
Renewable energy credit obligation		316			302
PHI merger related obligation		155			—
Other		1,025			842

Total current liabilities		11,894			9,118

Long-term debt		31,541			23,645
Long-term debt to financing trusts		641			641
Deferred credits and other liabilities
Deferred income taxes and unamortized investment tax credits		17,662			13,776
Asset retirement obligations		9,256			8,585
Pension obligations		3,767			3,385
Non-pension postretirement benefit obligations		1,900			1,618
Spent nuclear fuel obligation		1,023			1,021
Regulatory liabilities		4,389			4,201
Mark-to-market derivative liabilities		442			374
Unamortized energy contract liabilities		1,011			117
Payable for Zion Station decommissioning		54			90
Other		1,876			1,491

Total deferred credits and other liabilities		41,380			34,658

Total liabilities		85,456			68,062

Commitments and contingencies
Contingently redeemable noncontrolling interest		24			28
Shareholders’ equity
Common stock		18,722			18,676
Treasury stock, at cost		(2,327	)		(2,327	)
Retained earnings		11,926			12,068
Accumulated other comprehensive loss, net		(2,565	)		(2,624	)

Total shareholders’ equity		25,756			25,793
BGE preference stock not subject to mandatory redemption		193			193
Noncontrolling interests		1,349			1,308

Total equity		27,298			27,294

Total liabilities and shareholders’ equity	$	112,778		$	95,384

EXELON CORPORATION

Consolidated Statements of Cash Flows

(unaudited)

(in millions)


	Six Months Ended June 30,
	2016			2015
Cash flows from operating activities
Net income	$	430		$	1,372
Adjustments to reconcile net income to net cash flows provided by operating activities:
Depreciation, amortization, depletion and accretion, including nuclear fuel and energy contract amortization		2,396			1,957
Impairment of long-lived assets and losses on regulatory assets		239			24
Gain on sales of assets		(40	)		(8	)
Deferred income taxes and amortization of investment tax credits		261			211
Net fair value changes related to derivatives		194			(507	)
Net realized and unrealized gains on nuclear decommissioning trust fund investments		(114	)		(2	)
Other non-cash operating activities		1,056			579
Changes in assets and liabilities:
Accounts receivable		86			253
Inventories		89			159
Accounts payable and accrued expenses		(363	)		(540	)
Option premiums received, net		(10	)		22
Collateral received, net		710			659
Income taxes		470			247
Pension and non-pension postretirement benefit contributions		(258	)		(301	)
Other assets and liabilities		(593	)		(156	)

Net cash flows provided by operating activities		4,553			3,969

Cash flows from investing activities
Capital expenditures		(4,489	)		(3,460	)
Proceeds from nuclear decommissioning trust fund sales		4,977			3,314
Investment in nuclear decommissioning trust funds		(5,094	)		(3,437	)
Acquisition of businesses, net of cash acquired		(6,642	)		(28	)
Proceeds from sales of long-lived assets		45			145
Proceeds from termination of direct financing lease investment		360			—
Change in restricted cash		15			(3	)
Other investing activities		(49	)		(77	)

Net cash flows used in investing activities		(10,877	)		(3,546	)

Cash flows from financing activities
Changes in short-term borrowings		(798	)		94
Proceeds from short-term borrowings with maturities greater than 90 days		194			—
Repayments on short-term borrowings with maturities greater than 90 days		(315	)		—
Issuance of long-term debt		3,174			5,907
Retirement of long-term debt		(217	)		(1,708	)
Dividends paid on common stock		(582	)		(537	)
Proceeds from employee stock plans		17			16
Other financing activities		(4	)		(59	)

Net cash flows provided by financing activities		1,469			3,713

(Decrease) increase in cash and cash equivalents		(4,855	)		4,136
Cash and cash equivalents at beginning of period		6,502			1,878

Cash and cash equivalents at end of period	$	1,647		$	6,014

EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations

(unaudited)

(in millions, except per share data)


	Three Months Ended June 30, 2016										Three Months Ended June 30, 2015
	GAAP (a)			Adjustments				Adjusted Non-GAAP			GAAP (a)			Adjustments				Adjusted Non-GAAP
Operating revenues	$	6,910		$	626		(b),(d),(e)	$	7,536		$	6,514		$	(7	)	(b),(d)	$	6,507
Operating expenses
Purchased power and fuel		2,454			300		(b),(d),(i)		2,754			2,449			214		(b),(d)		2,663
Operating and maintenance		2,505			(172	)	(e),(g),(i), (j)		2,333			2,042			(41	)	(e),(g)		2,001
Depreciation and amortization		941			(114	)	(i)		827			602			—				602
Taxes other than income		394			—				394			294			—				294

Total operating expenses		6,294			14				6,308			5,387			173				5,560
Gain on sales of assets		31			—				31			7			—				7

Operating income		647			612				1,259			1,134			(180	)			954

Other income and (deductions)
Interest expense, net		(376	)		—				(376	)		(155	)		(104	)	(e),(h)		(259	)
Other, net		144			(89	)	(c),(i)		55			(17	)		127		(c)		110

Total other income and (deductions)		(232	)		(89	)			(321	)		(172	)		23				(149	)

Income before income taxes		415			523				938			962			(157	)			805
Income taxes		102			194		(b),(c),(d), (f),(g),(i), (j)		296			327			(41	)	(b),(c),(d), (e),(g),(h)		286
Equity in losses of unconsolidated affiliates		(7	)		—				(7	)		(2	)		—				(2	)

Net income		306			329				635			633			(116	)			517
Net income (loss) attributable to noncontrolling interests and preference stock dividends		39			(8	)	(k)		31			(5	)		14		(k)		9

Net income attributable to common shareholders	$	267		$	337			$	604		$	638		$	(130	)		$	508

Effective tax rate		24.6	%						31.6	%		34.0	%						35.5	%
Earnings per average common share
Basic	$	0.29		$	0.36			$	0.65		$	0.74		$	(0.15	)		$	0.59
Diluted	$	0.29		$	0.36			$	0.65		$	0.74		$	(0.15	)		$	0.59

Average common shares outstanding
Basic		924							924			863							863
Diluted		926							926			866							866
Effect of adjustments on earnings per average diluted common share recorded in accordance with GAAP:
Mark-to-market impact of economic hedging activities (b)				$	0.20									$	(0.16	)
Unrealized (gains) losses related to NDT fund investments (c)					(0.03	)									0.06
Amortization of commodity contract intangibles (d)					0.01										0.01
Merger and integration costs (e)					—										0.02
Merger commitments (f)					—										—
Long-lived asset impairments (g)					0.02										0.02
Mark-to-market impact of PHI merger related interest swap (h)					—										(0.08	)
Plant retirements and divestitures (i)					0.14										—
Cost management program (j)					0.01										—
CENG non-controlling interest (k)					0.01										(0.02	)

Total adjustments				$	0.36									$	(0.15	)

For the three months ended June 30, 2016, includes financial results for PHI. Therefore, the results of operations from 2016 and 2015 are not comparable for Exelon. The explanations below identify any other significant or unusual items affecting the results of operations.

(a)	Results reported in accordance with accounting principles generally accepted in the United States (GAAP).

(b)	Adjustment to exclude the mark-to-market impact of Exelon’s economic hedging activities, net of intercompany eliminations.

(c)	Adjustment to exclude the unrealized gains and losses on NDT fund investments to the extent not offset by contractual accounting as described in the notes to the consolidated financial statements.

(d)	Adjustment to exclude the non-cash amortization of intangible assets, net, related to commodity contracts recorded at fair value related to the Integrys acquisition.

(e)

Adjustment to exclude certain costs associated with mergers and acquisitions, including, if and when applicable, professional fees, employee-related expenses, integration activities, and upfront credit facilities fees, partially offset in 2016 at BGE and PHI by the anticipated recovery of previously incurred PHI acquisition costs.

(f)	Adjustment to exclude costs incurred as part of the settlement orders approving the PHI acquisition.

(g)	Adjustment to exclude a 2015 charge to earnings primarily related to the impairment of investment in long-term leases at Corporate and a 2016 charge to earnings primarily related to the impairment of certain wind projects at Generation.

(h)	Adjustment to exclude the mark-to-market impact of Exelon’s Corporate’s forward-starting interest rate swaps related to financing for the PHI acquisition, which were terminated on June 8, 2015.

(i)	Adjustment to exclude the impacts associated with the announced early retirement of Generation’s Clinton and Quad Cities nuclear facilities, partially offset by a gain associated with Generation’s 2016 sale of the New Boston generating site.

(j)	Adjustment to exclude the 2016 severance expense and reorganization costs related to a cost management program.

(k)	Adjustments to exclude the elimination from Generation’s results of the non-controlling interest related to CENG exclusion items, primarily related to the impact of unrealized gains and losses on NDT fund investments and mark-to-market activity.

EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations

(unaudited)

(in millions, except per share data)


	Six Months Ended June 30, 2016										Six Months Ended June 30, 2015
	GAAP (a)			Adjustments				Adjusted Non-GAAP			GAAP (a)			Adjustments				Adjusted Non-GAAP
Operating revenues	$	14,485		$	534		(b),(d),(e)	$	15,019		$	15,345		$	(201	)	(b),(d)	$	15,144
Operating expenses
Purchased power and fuel		5,708			338		(b),(d),(i)		6,046			6,919			220		(b),(d)		7,139
Operating and maintenance		5,341			(932	)	(e),(f),(g), (i),(j)		4,409			4,123			(53	)	(e),(g),(k)		4,070
Depreciation and amortization		1,626			(114	)	(i)		1,512			1,212			—				1,212
Taxes other than income		720			(1	)	(j)		719			598			—				598

Total operating expenses		13,395			(709	)			12,686			12,852			167				13,019
Gain on sales of assets		40			—				40			8			—				8

Operating income		1,130			1,243				2,373			2,501			(368	)			2,133

Other income and (deductions)
Interest expense, net		(663	)		—				(663	)		(501	)		(15	)	(e),(h)		(516	)
Other, net		258			(155	)	(c),(i)		103			64			78		(c)		142

Total other income and (deductions)		(405	)		(155	)			(560	)		(437	)		63				(374	)

Income before income taxes		725			1,088				1,813			2,064			(305	)			1,759
Income taxes		285			311		(b),(c),(d), (e),(f),(g), (i),(j)		596			690			(104	)	(b),(c),(d), (e),(g),(h), (k)		586
Equity in losses of unconsolidated affiliates		(10	)		—				(10	)		(2	)		—				(2	)

Net income		430			777				1,207			1,372			(201	)			1,171
Net income attributable to noncontrolling interests and preference stock dividends		(10	)		(18	)	(l)		(28	)		41			7		(l)		48

Net income attributable to common shareholders	$	440		$	795			$	1,235		$	1,331		$	(208	)		$	1,123

Effective tax rate		39.3	%						32.9	%		33.4	%						33.3	%
Earnings per average common share
Basic	$	0.48		$	0.86			$	1.34		$	1.54		$	(0.24	)		$	1.30
Diluted	$	0.48		$	0.85			$	1.33		$	1.54		$	(0.24	)		$	1.30

Average common shares outstanding
Basic		923							923			862							862
Diluted		926							926			866							866
Effect of adjustments on earnings per average diluted common share recorded in accordance with GAAP:
Mark-to-market impact of economic hedging activities (b)				$	0.12									$	(0.27	)
Unrealized (gains) losses related to NDT fund investments (c)					(0.07	)									0.04
Amortization of commodity contract intangibles (d)					—										(0.02	)
Merger and integration costs (e)					0.09										0.04
Merger commitments (f)					0.43										—
Long-lived asset impairments (g)					0.10										0.02
Mark-to-market impact of PHI merger related interest swap (h)					—										(0.03	)
Plant retirements and divestitures (i)					0.14										—
Cost management program (j)					0.02										—
Midwest Generation bankruptcy recoveries (k)					—										(0.01	)
CENG non-controlling interest (l)					0.02										(0.01	)

Total adjustments				$	0.85									$	(0.24	)

As a result of the PHI acquisition completion on March 23, 2016, the table includes financial results for PHI beginning on March 24, 2016 to June 30, 2016. Therefore, the results of operations from 2016 and 2015 are not comparable for Exelon. The explanations below identify any other significant or unusual items affecting the results of operations.

(a)	Results reported in accordance with accounting principles generally accepted in the United States (GAAP).

(b)	Adjustment to exclude the mark-to-market impact of Exelon’s economic hedging activities, net of intercompany eliminations.

(c)	Adjustment to exclude the unrealized gains and losses on NDT fund investments to the extent not offset by contractual accounting as described in the notes to the consolidated financial statements.

(d)	Adjustment to exclude the non-cash amortization of intangible assets, net, related to commodity contracts recorded at fair value related to the Integrys acquisition.

(e)

Adjustment to exclude certain costs associated with mergers and acquisitions, including, if and when applicable, professional fees, employee-related expenses, integration activities, and upfront credit facilities fees, partially offset in 2016 at ComEd, BGE and PHI by the anticipated recovery of previously incurred PHI acquisition costs.

(f)	Adjustment to exclude costs incurred as part of the settlement orders approving the PHI acquisition.

(g)	Adjustment to exclude a 2015 charge to earnings primarily related to the impairment of investment in long-term leases at Corporate and 2016 charges to earnings primarily related to the impairment of upstream assets and certain wind projects at Generation.

(h)	Adjustment to exclude the mark-to-market impact of Exelon’s Corporate’s forward-starting interest rate swaps related to financing for the PHI acquisition, which were terminated on June 8, 2015.

(i)	Adjustment to exclude the impacts associated with the announced early retirement of Generation’s Clinton and Quad Cities nuclear facilities, partially offset by a gain associated with Generation’s 2016 sale of the New Boston generating site.

(j)	Adjustment to exclude the 2016 severance expense and reorganization costs related to a cost management program.

(k)	Adjustment to exclude a 2015 benefit for the favorable settlement of a long-term railcar lease agreement pursuant to the Midwest Generation bankruptcy.

(l)	Adjustments to exclude the elimination from Generation’s results of the non-controlling interest related to CENG exclusion items, primarily related to the impact of unrealized gains and losses on NDT fund investments and mark-to-market activity.

EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating

Earnings to GAAP Earnings (in millions)

Three Months Ended June 30, 2016 and 2015

(unaudited)


	Exelon Earnings per Diluted Share			Generation			ComEd			PECO			BGE			PHI (a)			Other (b)			Exelon (a)
2015 GAAP Earnings	$	0.74		$	398		$	99		$	70		$	44		$	—		$	27		$	638
2015 Adjusted (non-GAAP) Operating (Earnings) Loss Adjustments:
Mark-to-Market Impact of Economic Hedging Activities		(0.16	)		(145	)		—			—			—			—			2			(143	)
Unrealized Losses Related to NDT Fund Investments (1)		0.06			56			—			—			—			—			—			56
Amortization of Commodity Contract Intangibles (2)		0.01			9			—			—			—			—			—			9
Merger and Integration Costs (3)		0.02			5			2			1			1			—			9			18
Long-Lived Asset Impairments (4)		0.02			—			—			—			—			—			15			15
Mark-to-Market Impact of PHI Merger Related Interest Rate Swap (5)		(0.08	)		—			—			—			—			—			(71	)		(71	)
CENG Non-Controlling Interest (6)		(0.02	)		(14	)		—			—			—			—			—			(14	)

2015 Adjusted (non-GAAP) Operating Earnings (Loss)		0.59			309			101			71			45			—			(18	)		508
Year Over Year Effects on Earnings:
Generation Energy Margins, Excluding Mark-to-Market:
Nuclear Volume (10)		(0.02	)		(23	)		—			—			—			—			—			(23	)
Nuclear Fuel Cost (11)		0.01			11			—			—			—			—			—			11
Capacity Pricing (12)		0.01			9			—			—			—			—			—			9
Market and Portfolio Conditions (13)		0.12			111			—			—			—			—			—			111
ComEd, PECO, BGE and PHI Margins:
Weather		0.01			—			14			(4	)		—	(c)		—	(c)		—			10
Load		—			—			1			2			—	(c)		—	(c)		—			3
Other Energy Delivery (14)		0.48			—			31	(d)		15	(d)		18	(d)		381	(d)		—			445
Operating and Maintenance Expense:
Labor, Contracting and Materials (15)		(0.13	)		(19	)		2			(5	)		—			(96	)		—			(118	)
Planned Nuclear Refueling Outages (16)		—			4			—			—			—			—			—			4
Pension and Non-Pension Postretirement Benefits (17)		0.01			8			4			1			—			(9	)		2			6
Other Operating and Maintenance (18)		(0.11	)		(28	)		2			6			(38	)		(40	)		(2	)		(100	)
Depreciation and Amortization Expense (19)		(0.14	)		(24	)		(8	)		1			(6	)		(93	)		(2	)		(132	)
Interest Expense, Net (20)		(0.06	)		4			(6	)		(2	)		—			(32	)		(21	)		(57	)
Income Taxes (21)		0.04			12			4			15			10			6			(10	)		37
Equity in Earnings of Unconsolidated Affiliates		—			(4	)		—			—			—			—			—			(4	)
CENG Non-Controlling Interest (22)		(0.02	)		(14	)		—			—			—			—			—			(14	)
Other (23)		(0.10	)		(28	)		1			1			—			(64	)		(2	)		(92	)
Share Differential (24)		(0.04	)		—			—			—			—			—			—			—

2016 Adjusted (non-GAAP) Operating Earnings (Loss)		0.65			328			146			101			29			53			(53	)		604
2016 Adjusted (non-GAAP) Operating Earnings (Loss) Adjustments:
Mark-to-Market Impact of Economic Hedging Activities		(0.20	)		(185	)		—			—			—			—			—			(185	)
Unrealized Gains Related to NDT Fund Investments (1)		0.03			27			—			—			—			—			—			27
Amortization of Commodity Contract Intangibles (2)		(0.01	)		(8	)		—			—						—			—			(8	)
Merger and Integration Costs (3)		—			(3	)		(1	)		—			3			—			—			(1	)
Merger Commitments (7)		—			—			—			—			—			(1	)		—			(1	)
Long-Lived Asset Impairments (4)		(0.02	)		(22	)		—			—			—			—			—			(22	)
Plant Retirements and Divestitures (8)		(0.14	)		(133	)		—			—			—			—			—			(133	)
Cost Management Program (9)		(0.01	)		(4	)		—			(1	)		(1	)		—			—			(6	)
CENG Non-Controlling Interest (6)		(0.01	)		(8	)		—			—			—			—			—			(8	)

2016 GAAP Earnings (Loss)	$	0.29		$	(8	)	$	145		$	100		$	31		$	52		$	(53	)	$	267

Notes:

The above analysis is presented on an after-tax basis. Income taxes related to (non-GAAP) operating adjustments are computed based upon the applicable tax law and enacted tax rates, unless otherwise noted. In computing the tax, the ability to monetize tax attributes and the impact to calculations such as the domestic production activities deduction is taken into consideration. Refer to the Reconciliations of Adjusted (non-GAAP) Operating Earnings to GAAP Consolidated Statements of Operations within the Earnings Release Attachments for further information regarding income tax impacts.

(a)

For the three months ended June 30, 2016, includes financial results for PHI. Therefore, the results of operations from 2016 and 2015 are not comparable for PHI and Exelon. The explanations below identify any other significant or unusual items affecting the results of operations. PHI consolidated results includes Potomac Electric Power Company, Delmarva Power & Light Company, and Atlantic City Electric Company.

(b)	Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities and other financing and investment activities.

(c)	As approved by the Maryland PSC and District of Columbia PSC, BGE, Pepco and DPL Maryland record monthly adjustments to rates for residential, commercial and industrial customers to eliminate the effects of abnormal weather and usage patterns per customer on distribution volumes.

(d)

For regulatory recovery mechanisms, including ComEd’s distribution formula rate, ComEd, BGE and PHI utilities transmission formula rates, and riders across all utilities, revenues increase and decrease i) as fully recoverable costs fluctuate (with no impact on net earnings), and ii) pursuant to changes in rate base, capital structure and ROE (which impact net earnings).

(1)	Reflects the impact of unrealized losses in 2015 and unrealized gains in 2016 on NDT fund investments to the extent not offset by contractual accounting as described in the notes to the consolidated financial statements.

(2)	Represents the non-cash amortization of intangible assets, net, related to commodity contracts recorded at fair value related to the Integrys acquisition.

(3)

Reflects certain costs associated with mergers and acquisitions, including, if and when applicable, professional fees, employee-related expenses, integration activities, and upfront credit facilities fees, partially offset in 2016 at BGE and PHI by the anticipated recovery of previously incurred PHI acquisition costs.

(4)	Reflects impairment of investment in long-term leases at Corporate in 2015 and the impairment of certain wind projects at Generation in 2016.

(5)	Reflects the impact of mark-to-market activity on forward-starting interest rate swaps held at Exelon Corporate related to financing for the PHI acquisition, which were terminated on June 8, 2015.

(6)	Represents elimination from Generation’s results of the non-controlling interest related to CENG exclusion items, primarily related to the impact of unrealized gains and losses on NDT fund investments and mark-to-market activity.

(7)	Represents costs incurred as part of the settlement orders approving the PHI acquisition.

(8)

Primarily reflects accelerated depreciation and amortization expenses, increases to materials and supplies inventory reserves, charges for severance reserves and construction work in progress impairments associated with the announced early retirement of Generation’s Clinton and Quad Cities nuclear facilities, partially offset by a gain associated with Generation’s 2016 sale of the New Boston generating site.

(9)	Represents 2016 severance expense and reorganization costs related to a cost management program.

(10)	Primarily reflects increased nuclear outage days in 2016 versus 2015.

(11)	Primarily reflects a decrease in fuel prices and decreased nuclear output.

(12)	Primarily reflects increased capacity prices in the New England and Midwest regions.

(13)

Primarily reflects the approval of the Ginna Reliability Support Services Agreement, revenue related to the inclusion of Pepco Energy Services results in 2016, and revenue related to energy efficiency projects, partially offset by lower realized energy prices in the Mid-Atlantic and Midwest regions.

(14)

For ComEd, primarily reflects increased electric distribution and transmission formula rate revenues due to increased capital investments, partially offset by lower allowed return on common equity due to a decrease in treasury rates. For PECO, primarily reflects increased electric distribution revenue pursuant to a rate increase effective January 1, 2016. For BGE, primarily reflects increased transmission revenue due to increased capital investments and operating and maintenance expense recoveries and increased distribution revenue pursuant to increased rates effective in June 2016.

(15)	For Generation, primarily reflects increased contracting costs related to energy efficiency projects and the inclusion of Pepco Energy Services results in 2016.

(16)	Primarily reflects the impact of decreased operating and maintenance refueling outage costs, despite increased outage days, given reduced scopes of outage activities.

(17)	Primarily reflects favorable impact of higher pension and OPEB discount rates in 2016.

(18)

For Generation, primarily reflects the timing and extended duration of an outage at Salem and the inclusion of Pepco Energy Services results in 2016. For BGE, primarily reflects charges for certain disallowances contained in the June and July 2016 rate case orders and increased underground conduit rental fees assessed by the City of Baltimore.

(19)	Primarily reflects increased nuclear decommissioning amortization at Generation and increased depreciation for ongoing capital expenditures across all operating companies.

(20)	At Corporate, primarily reflects increased interest expense due to higher outstanding debt to fund the PHI acquisition and general corporate purposes.

(21)

At Generation, primarily reflects the favorable impact of the expiration of statutes of limitation, partially offset by decrease in domestic production activities deduction. At PECO, primarily reflects the impact of a cumulative adjustment related to an anticipated gas repairs tax return accounting method change. At BGE, primarily reflects a cumulative adjustment to tax expense for transmission-related regulatory assets pending anticipated recovery from transmission customers. At Corporate, primarily reflects the unfavorable impact of the expiration of statutes of limitation.

(22)	Reflects elimination from Generation’s results of the non-controlling interest related to the net impact of CENG’s operating revenue and expenses.

(23)	For Generation, primarily reflects lower realized NDT fund gains.

(24)	Reflects the impact on earnings per share due to the increase in Exelon’s average diluted common shares outstanding as a result of the July 2015 common stock issuance.

EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating

Earnings to GAAP Earnings (in millions)

Six Months Ended June 30, 2016 and 2015

(unaudited)


	Exelon Earnings per Diluted Share			Generation			ComEd			PECO			BGE			PHI (a)			Other (b)			Exelon (a)
2015 GAAP Earnings (Loss)	$	1.54		$	841		$	189		$	209		$	151		$	—		$	(59	)	$	1,331
2015 Adjusted (non-GAAP) Operating (Earnings) Loss Adjustments:
Mark-to-Market Impact of Economic Hedging Activities		(0.27	)		(245	)		—			—			—			—			2			(243	)
Unrealized Losses Related to NDT Fund Investments (1)		0.04			32			—			—			—			—			—			32
Amortization of Commodity Contract Intangibles (2)		(0.02	)		(15	)		—			—			—			—			—			(15	)
Merger and Integration Costs (3)		0.04			12			3			1			2			—			19			37
Long-Lived Asset Impairments (4)		0.02			—			—			—			—			—			15			15
Mark-to-Market Impact of PHI Merger Related Interest Rate Swap (5)		(0.03	)		—			—			—			—			—			(21	)		(21	)
Midwest Generation Bankruptcy Recoveries (6)		(0.01	)		(6	)		—			—			—			—			—			(6	)
CENG Non-Controlling Interest (7)		(0.01	)		(7	)		—			—			—			—			—			(7	)

2015 Adjusted (non-GAAP) Operating Earnings (Loss)		1.30			612			192			210			153			—			(44	)		1,123
Year Over Year Effects on Earnings:
Generation Energy Margins, Excluding Mark-to-Market:
Nuclear Volume (12)		0.04			37			—			—			—			—			—			37
Nuclear Fuel Cost (13)		0.01			7			—			—			—			—			—			7
Capacity Pricing (14)		0.03			28			—			—			—			—			—			28
Market and Portfolio Conditions (15)		0.02			15			—			—			—			—			—			15
ComEd, PECO, BGE and PHI Margins:
Weather		(0.05	)		—			2			(46	)		—	(c)		—	(c)		—			(44	)
Load		—			—			(2	)		7			—	(c)		—	(c)		—			5
Other Energy Delivery (16)		0.59			—			66	(d)		37	(d)		22	(d)		419	(d)		—			544
Operating and Maintenance Expense:
Labor, Contracting and Materials (17)		(0.15	)		(24	)		2			(5	)		(1	)		(108	)		—			(136	)
Planned Nuclear Refueling Outages (18)		0.01			12			—			—			—			—			—			12
Pension and Non-Pension Postretirement Benefits (19)		0.01			15			6			1			(1	)		(11	)		2			12
Other Operating and Maintenance (20)		(0.12	)		(38	)		4			11			(48	)		(42	)		4			(109	)
Depreciation and Amortization Expense (21)		(0.19	)		(45	)		(16	)		(2	)		(8	)		(102	)		(4	)		(177	)
Interest Expense, Net (22)		(0.08	)		5			(7	)		(4	)		1			(34	)		(35	)		(74	)
Income Taxes (23)		0.04			9			4			17			10			5			(9	)		36
Equity in Earnings of Unconsolidated Affiliates		(0.01	)		(5	)		—			—			—			—			—			(5	)
CENG Non-Controlling Interest (24)		0.05			47			—			—			—			—			—			47
Other (25)		(0.09	)		(34	)		5			1			1			(72	)		13			(86	)
Share Differential (26)		(0.08	)		—			—			—			—			—			—			—

2016 Adjusted (non-GAAP) Operating Earnings (Loss)		1.33			641			256			227			129			55			(73	)		1,235
2016 Adjusted (non-GAAP) Operating Earnings (Loss) Adjustments:
Mark-to-Market Impact of Economic Hedging Activities		(0.12	)		(121	)		—			—			—			—			—			(121	)
Unrealized Gains Related to NDT Fund Investments (1)		0.07			59			—			—			—			—			—			59
Amortization of Commodity Contract Intangibles (2)		—			4			—			—			—			—			—			4
Merger and Integration Costs (3)		(0.09	)		(14	)		4			(1	)		2			(33	)		(37	)		(79	)
Merger Commitments (8)		(0.43	)		(2	)		—			—			—			(279	)		(114	)		(395	)
Long-Lived Asset Impairments (4)		(0.10	)		(93	)		—			—			—			—			—			(93	)
Plant Retirements and Divestitures (9)		(0.14	)		(133	)		—			—			—			—			—			(133	)
Reassessment of State Deferred Income Taxes (10)		—			(6	)		—			—			—			—			6			—
Cost Management Program (11)		(0.02	)		(15	)		—			(2	)		(2	)		—			—			(19	)
CENG Non-Controlling Interest (7)		(0.02	)		(18	)		—			—			—			—			—			(18	)

2016 GAAP Earnings (Loss)	$	0.48		$	302		$	260		$	224		$	129		$	(257	)	$	(218	)	$	440

Note:

(a)

As a result of the PHI acquisition completion on March 23, 2016, the table includes financial results for PHI beginning on March 24, 2016 to June 30, 2016. Therefore, the results of operations from 2016 and 2015 are not comparable for PHI and Exelon. The explanations below identify any other significant or unusual items affecting the results of operations. PHI consolidated results includes Potomac Electric Power Company, Delmarva Power & Light Company, and Atlantic City Electric Company.

(b)	Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities and other financing and investment activities.

(c)	As approved by the Maryland PSC and District of Columbia PSC, BGE, Pepco and DPL Maryland record monthly adjustments to rates for residential, commercial and industrial customers to eliminate the effects of abnormal weather and usage patterns per customer on distribution volumes.

(d)

(1)	Reflects the impact of unrealized losses in 2015 and unrealized gains in 2016 on NDT fund investments to the extent not offset by contractual accounting as described in the notes to the consolidated financial statements.

(2)	Represents the non-cash amortization of intangible assets, net, related to commodity contracts recorded at fair value related to the Integrys acquisition.

(3)

Reflects certain costs associated with mergers and acquisitions, including, if and when applicable, professional fees, employee-related expenses, integration activities, and upfront credit facilities fees, partially offset in 2016 at ComEd, BGE and PHI by the anticipated recovery of previously incurred PHI acquisition costs.

(4)	Reflects impairment of investment in long-term leases at Corporate in 2015 and the impairment of upstream assets and certain wind projects at Generation in 2016.

(5)	Reflects the impact of mark-to-market activity on forward-starting interest rate swaps held at Exelon Corporate related to financing for the PHI acquisition, which were terminated on June 8, 2015.

(6)	Primarily reflects a 2015 benefit for the favorable settlement of a long-term railcar lease agreement pursuant to the Midwest Generation bankruptcy.

(7)	Represents elimination from Generation’s results of the non-controlling interest related to CENG exclusion items, primarily related to the impact of unrealized gains and losses on NDT fund investments and mark-to-market activity.

(8)	Represents costs incurred as part of the settlement orders approving the PHI acquisition.

(9)

(10)	Reflects the non-cash impact of the remeasurement of state deferred income taxes, primarily as a result of changes in forecasted apportionment related to the PHI acquisition in 2016.

(11)	Represents 2016 severance expense and reorganization costs related to a cost management program.

(12)	Primarily reflects decreased nuclear outage days at higher capacity units in 2016 versus 2015.

(13)	Primarily reflects a decrease in fuel prices, partially offset by increased nuclear output.

(14)	Primarily reflects increased capacity prices in the Mid-Atlantic and Midwest regions.

(15)

(16)

For ComEd, primarily reflects increased electric distribution and transmission formula rate revenues due to increased capital investments, partially offset by a decrease in fully recoverable costs. For PECO, primarily reflects increased electric distribution revenue pursuant to a rate increase effective January 1, 2016. For BGE, primarily reflects increased transmission revenue due to increased capital investments and operating and maintenance expense recoveries and increased distribution revenue pursuant to increased rates effective in June 2016.

(17)	For Generation, reflect the net increase to contracting costs primarily related to energy efficiency projects and the inclusion of Pepco Energy Services results in 2016.

(18)	Primarily reflects the impact of reduced operating and maintenance outage scopes for refueling outages in 2016.

(19)	Primarily reflects favorable impact of higher pension and OPEB discount rates in 2016.

(20)

For Generation, primarily reflects the timing and extended duration of an outage at Salem and the inclusion of Pepco Energy Services results in 2016. For PECO, primarily reflects decreased storm costs. For BGE, primarily reflects charges for certain disallowances contained in the June and July 2016 rate case orders, increased storm costs in the BGE service territory, and increased underground conduit rental fees assessed by the City of Baltimore.

(21)	Primarily reflects increased nuclear decommissioning amortization at Generation and increased depreciation for ongoing capital expenditures across all operating companies.

(22)	At Corporate, primarily reflects increased interest expense due to higher outstanding debt to fund the PHI acquisition and general corporate purposes.

(23)

(24)	Reflects elimination from Generation’s results of the non-controlling interest related to the net impact of CENG’s operating revenue and expenses.

(25)	For Generation, primarily reflects lower realized NDT fund gains. For Corporate, primarily reflects the absence of a 2015 loss on the termination of forward-starting interest rate swaps.

(26)	Reflects the impact on earnings per share due to the increase in Exelon’s average diluted common shares outstanding as a result of the July 2015 common stock issuance.

EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating Earnings to

GAAP Consolidated Statements of Operations

(unaudited) (in millions)


	Generation
	Three Months Ended June 30, 2016										Three Months Ended June 30, 2015
	GAAP (a)			Adjustments				Adjusted Non-GAAP			GAAP (a)			Adjustments				Adjusted Non-GAAP
Operating revenues	$	3,589		$	625		(b),(d)	$	4,214		$	4,232		$	(7	)	(b),(d)	$	4,225
Operating expenses
Purchased power and fuel		1,577			300		(b),(d),(h)		1,877			1,849			214		(b),(d)		2,063
Operating and maintenance		1,530			(174	)	(e),(g),(h), (i)		1,356			1,308			(7	)	(e)		1,301
Depreciation and amortization		408			(114	)	(h)		294			255			—				255
Taxes other than income		118			—				118			124			—				124

Total operating expenses		3,633			12				3,645			3,536			207				3,743

Gain on sales of assets		31			—				31			7			—				7

Operating (loss) income		(13	)		613				600			703			(214	)			489

Other income and (deductions)
Interest expense, net		(99	)		—				(99	)		(99	)		—				(99	)
Other, net		117			(89	)	(c),(h)		28			(31	)		127		(c)		96

Total other income and (deductions)		18			(89	)			(71	)		(130	)		127				(3	)

Income before income taxes		5			524				529			573			(87	)			486
Income taxes		(31	)		196		(b),(c),(d), (e),(g),(h), (i)		165			181			(12	)	(b),(c),(d), (e)		169

Equity in losses of unconsolidated affiliates		(8	)		—				(8	)		(2	)		—				(2	)

Net income		28			328				356			390			(75	)			315
Net income (loss) attributable to noncontrolling interests		36			(8	)	(l)		28			(8	)		14		(l)		6

Net (loss) income attributable to membership interest	$	(8	)	$	336			$	328		$	398		$	(89	)		$	309


	Six Months Ended June 30, 2016										Six Months Ended June 30, 2015
	GAAP (a)			Adjustments				Adjusted Non-GAAP			GAAP (a)			Adjustments				Adjusted Non-GAAP
Operating revenues	$	8,329		$	542		(b),(d)	$	8,871		$	10,074		$	(201	)	(b),(d)	$	9,873
Operating expenses
Purchased power and fuel		4,020			338		(b),(d),(h)		4,358			5,282			220		(b),(d)		5,502
Operating and maintenance		2,997			(330	)	(e),(f),(g), (h),(i)		2,667			2,619			(8	)	(e),(j)		2,611
Depreciation and amortization		697			(114	)	(h)		583			509			—				509
Taxes other than income		244			(1	)	(i)		243			246			—				246

Total operating expenses		7,958			(107	)			7,851			8,656			212				8,868
Gain on sales of assets		31			—				31			6			—				6

Operating income		402			649				1,051			1,424			(413	)			1,011

Other income and (deductions)
Interest expense, net		(196	)		—				(196	)		(201	)		—				(201	)
Other, net		210			(155	)	(c),(h)		55			62			78		(c)		140

Total other income and (deductions)		14			(155	)			(141	)		(139	)		78				(61	)

Income before income taxes		416			494				910			1,285			(335	)			950
Income taxes		120			173		(b),(c),(d), (e),(f),(g), (h),(i),(k)		293			407			(113	)	(b),(c),(d), (e),(j)		294
Equity in losses of unconsolidated affiliates		(11	)		—				(11	)		(3	)		—				(3	)

Net income		285			321				606			875			(222	)			653
Net (loss) income attributable to noncontrolling interests		(17	)		(18	)	(l)		(35	)		34			7		(l)		41

Net income attributable to membership interest	$	302		$	339			$	641		$	841		$	(229	)		$	612

(a)	Results reported in accordance with GAAP.

(b)	Adjustment to exclude the mark-to-market impact of Exelon’s economic hedging activities, net of intercompany eliminations.

(c)	Adjustment to exclude the unrealized gains and losses on NDT fund investments to the extent not offset by contractual accounting as described in the notes to the consolidated financial statements.

(d)	Adjustment to exclude the non-cash amortization of intangible assets, net, related to commodity contracts recorded at fair value related to the Integrys acquisition.

(e)	Adjustment to exclude certain costs associated with mergers and acquisitions, including, if and when applicable, professional fees, employee-related expenses, integration activities, and upfront credit facilities fees.

(f)	Adjustment to exclude costs incurred as part of the settlement orders approving the PHI acquisition.

(g)	Adjustment to exclude 2016 charges to earnings primarily related to the impairment of upstream assets and certain wind projects at Generation.

(h)	Adjustment to exclude the impacts associated with the announced early retirement of Generation’s Clinton and Quad Cities nuclear facilities, partially offset by a gain associated with Generation’s 2016 sale of the New Boston generating site.

(i)	Adjustment to exclude the 2016 severance expense and reorganization costs related to a cost management program.

(j)	Adjustment to exclude a 2015 benefit for the favorable settlement of a long-term railcar lease agreement pursuant to the Midwest Generation bankruptcy.

(k)	Adjustment to exclude the non-cash impact of the remeasurement of state deferred income taxes, primarily as a result of changes in forecasted apportionment related to the PHI acquisition in 2016.

(l)	Adjustments to exclude the elimination from Generation’s results of the non-controlling interest related to CENG exclusion items, primarily related to the impact of unrealized gains and losses on NDT fund investments and mark-to-market activity.

EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating Earnings to

GAAP Consolidated Statements of Operations

(unaudited)

(in millions)


	ComEd
	Three Months Ended June 30, 2016											Three Months Ended June 30, 2015
	GAAP (a)			Adjustments					Adjusted Non-GAAP			GAAP (a)			Adjustments				Adjusted Non-GAAP
Operating revenues	$	1,286		$	1		(b)		$	1,287		$	1,148		$	—			$	1,148
Operating expenses
Purchased power		339			—					339			275			—				275
Operating and maintenance		368			—					368			384			(3	)	(b)		381
Depreciation and amortization		190			—					190			177			—				177
Taxes other than income		65			—					65			69			—				69

Total operating expenses		962			—					962			905			(3	)			902

Operating income		324			1					325			243			3				246

Other income and (deductions)
Interest expense, net		(91	)		—					(91	)		(81	)		—				(81	)
Other, net		3			—					3			5			—				5

Total other income and (deductions)		(88	)		—					(88	)		(76	)		—				(76	)

Income before income taxes		236			1					237			167			3				170
Income taxes		91			—					91			68			1		(b)		69

Net income	$	145		$	1				$	146		$	99		$	2			$	101


	Six Months Ended June 30, 2016											Six Months Ended June 30, 2015
	GAAP (a)			Adjustments					Adjusted Non-GAAP			GAAP (a)			Adjustments				Adjusted Non-GAAP
Operating revenues	$	2,535		$	(8	)	(b)		$	2,527		$	2,333		$	—			$	2,333
Operating expenses
Purchased power		686			—					686			601			—				601
Operating and maintenance		736			(1	)	(b)			735			762			(5	)	(b)		757
Depreciation and amortization		379			—					379			352			—				352
Taxes other than income		141			—					141			146			—				146

Total operating expenses		1,942			(1	)				1,941			1,861			(5	)			1,856
Gain on sales of assets		5			—					5			—			—				—

Operating income		598			(7	)				591			472			5				477

Other income and (deductions)
Interest expense, net		(177	)		—					(177	)		(165	)		—				(165	)
Other, net		7			—					7			9			—				9

Total other income and (deductions)		(170	)		—					(170	)		(156	)		—				(156	)

Income before income taxes		428			(7	)				421			316			5				321
Income taxes		168			(3	)	(b	)		165			127			2		(b)		129

Net income	$	260		$	(4	)			$	256		$	189		$	3			$	192

(a)	Results reported in accordance with GAAP.

(b)

Adjustment to exclude certain costs associated with mergers and acquisitions, including, if and when applicable, professional fees, employee-related expenses, integration activities, and upfront credit facilities fees, partially offset in 2016 at ComEd by the anticipated recovery of previously incurred PHI acquisition costs.

EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating Earnings to

GAAP Consolidated Statements of Operations

(unaudited)

(in millions)


	PECO
	Three Months Ended June 30, 2016										Three Months Ended June 30, 2015
	GAAP (a)			Adjustments				Adjusted Non-GAAP			GAAP (a)			Adjustments				Adjusted Non-GAAP
Operating revenues	$	664		$	—			$	664		$	661		$	—			$	661
Operating expenses
Purchased power and fuel		217			—				217			237			—				237
Operating and maintenance		190			(2	)	(b),(c)		188			192			(1	)	(b)		191
Depreciation and amortization		67			—				67			69			—				69
Taxes other than income		38			—				38			39			—				39

Total operating expenses		512			(2	)			510			537			(1	)			536

Operating income		152			2				154			124			1				125

Other income and (deductions)
Interest expense, net		(31	)		—				(31	)		(28	)		—				(28	)
Other, net		2			—				2			1			—				1

Total other income and (deductions)		(29	)		—				(29	)		(27	)		—				(27	)

Income before income taxes		123			2				125			97			1				98
Income taxes		23			1		(c)		24			27			—				27

Net income attributable to common shareholder	$	100		$	1			$	101		$	70		$	1			$	71


	Six Months Ended June 30, 2016										Six Months Ended June 30, 2015
	GAAP (a)			Adjustments				Adjusted Non-GAAP			GAAP (a)			Adjustments				Adjusted Non-GAAP
Operating revenues	$	1,505		$	—			$	1,505		$	1,646		$	—			$	1,646
Operating expenses
Purchased power and fuel		537			—				537			675			—				675
Operating and maintenance		405			(5	)	(b),(c)		400			414			(2	)	(b)		412
Depreciation and amortization		134			—				134			131			—				131
Taxes other than income		80			—				80			80			—				80

Total operating expenses		1,156			(5	)			1,151			1,300			(2	)			1,298
Gain on sales of assets		—			—				—			1			—				1

Operating income		349			5				354			347			2				349

Other income and (deductions)
Interest expense, net		(62	)		—				(62	)		(56	)		—				(56	)
Other, net		4			—				4			3			—				3

Total other income and (deductions)		(58)			—				(58)			(53)			—				(53)

Income before income taxes		291			5				296			294			2				296
Income taxes		67			2		(b),(c)		69			85			1		(b)		86

Net income attributable to common shareholder	$	224		$	3			$	227		$	209		$	1			$	210

(a)	Results reported in accordance with GAAP.

(b)	Adjustment to exclude certain costs associated with mergers and acquisitions, including, if and when applicable, professional fees, employee-related expenses, integration activities, and upfront credit facilities fees.

(c)	Adjustment to exclude the 2016 severance expense and reorganization costs related to a cost management program.

EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating Earnings to

GAAP Consolidated Statements of Operations

(unaudited)

(in millions)


	BGE
	Three Months Ended June 30, 2016										Three Months Ended June 30, 2015
	GAAP (a)			Adjustments				Adjusted Non-GAAP			GAAP (a)			Adjustments				Adjusted Non-GAAP
Operating revenues	$	680		$	—			$	680		$	628		$	—			$	628
Operating expenses
Purchased power and fuel		261			—				261			239			—				239
Operating and maintenance		208			4		(b),(c)		212			149			(2	)	(b)		147
Depreciation and amortization		97			—				97			87			—				87
Taxes other than income		55			—				55			54			—				54

Total operating expenses		621			4				625			529			(2	)			527

Operating income		59			(4	)			55			99			2				101

Other income and (deductions)
Interest expense, net		(24	)		—				(24	)		(24	)		—				(24	)
Other, net		5			—				5			4			—				4

Total other income and (deductions)		(19	)		—				(19	)		(20	)		—				(20	)

Income before income taxes		40			(4	)			36			79			2				81
Income taxes		6			(2	)	(b),(c)		4			32			1		(b)		33

Net income		34			(2	)			32			47			1				48
Preference stock dividends		3			—				3			3			—				3

Net income attributable to common shareholder	$	31		$	(2	)		$	29		$	44		$	1			$	45


	Six Months Ended June 30, 2016										Six Months Ended June 30, 2015
	GAAP (a)			Adjustments				Adjusted Non-GAAP			GAAP (a)			Adjustments				Adjusted Non-GAAP
Operating revenues	$	1,609		$	—			$	1,609		$	1,664		$	—			$	1,664
Operating expenses
Purchased power and fuel		634			—				634			726			—				726
Operating and maintenance		410			1		(b),(c)		411			331			(3	)	(b)		328
Depreciation and amortization		206			—				206			192			—				192
Taxes other than income		114			—				114			111			—				111

Total operating expenses		1,364			1				1,365			1,360			(3	)			1,357

Operating income		245			(1	)			244			304			3				307

Other income and (deductions)
Interest expense, net		(48	)		—				(48	)		(50	)		—				(50	)
Other, net		11			—				11			8			—				8

Total other income and (deductions)		(37	)		—				(37	)		(42	)		—				(42	)

Income before income taxes		208			(1	)			207			262			3				265
Income taxes		73			(1	)	(b),(c)		72			105			1		(b)		106

Net income		135			—				135			157			2				159
Preference stock dividends		6			—				6			6			—				6

Net income attributable to common shareholder	$	129		$	—			$	129		$	151		$	2			$	153

(a)	Results reported in accordance with GAAP.

(b)

Adjustment to exclude certain costs associated with mergers and acquisitions, including, if and when applicable, professional fees, employee-related expenses, integration activities, and upfront credit facilities fees, partially offset in 2016 at BGE by the anticipated recovery of previously incurred PHI acquisition costs.

(c)	Adjustment to exclude the 2016 severance expense and reorganization costs related to a cost management program.

EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating Earnings to

GAAP Consolidated Statements of Operations

(unaudited) (in millions)


	PHI
	Three Months Ended June 30, 2016										Three Months Ended June 30, 2015
	GAAP (a)			Adjustments				Adjusted Non-GAAP			GAAP (a)		Adjustments		Adjusted Non-GAAP
Operating revenues	$	1,066		$	—			$	1,066		$	—	$	—	$	—
Operating expenses
Purchased power and fuel		416			—				416			—		—		—
Operating and maintenance		246			—				246			—		—		—
Depreciation and amortization		160			—				160			—		—		—
Taxes other than income		108			—				108			—		—		—

Total operating expenses		930			—				930			—		—		—

Operating income		136			—				136			—		—		—

Other income and (deductions)
Interest expense, net		(66	)		—				(66	)		—		—		—
Other, net		11			—				11			—		—		—

Total other income and (deductions)		(55	)		—				(55	)		—		—		—

Income before income taxes		81			—				81			—		—		—
Income taxes		29			(1	)	(c)		28			—		—		—

Net income	$	52		$	1			$	53		$	—	$	—	$	—


	Six Months Ended June 30, 2016										Six Months Ended June 30, 2015
	GAAP (a)			Adjustments				Adjusted Non-GAAP			GAAP (a)		Adjustments		Adjusted Non-GAAP
Operating revenues	$	1,171		$	—			$	1,171		$	—	$	—	$	—
Operating expenses
Purchased power and fuel		454			—				454			—		—		—
Operating and maintenance		695			(419	)	(b),(c)		276			—		—		—
Depreciation and amortization		174			—				174			—		—		—
Taxes other than income		123			—				123			—		—		—

Total operating expenses		1,446			(419	)			1,027			—		—		—

Operating loss		(275	)		419				144			—		—		—

Other income and (deductions)
Interest expense, net		(71	)		—				(71	)		—		—		—
Other, net		12			—				12			—		—		—

Total other income and (deductions)		(59	)		—				(59	)		—		—		—

Loss before income taxes		(334	)		419				85			—		—		—
Income taxes		(77	)		107		(b),(c)		30			—		—		—

Net loss	$	(257	)	$	312			$	55		$	—	$	—	$	—

As a result of the PHI acquisition completion on March 23, 2016, the table includes financial results for PHI beginning on March 24, 2016 to June 30, 2016 for the six months ended and quarterly results for the June 30, 2016 three months ended period. Therefore, the results of operations from 2016 and 2015 are not comparable for PHI and Exelon. The explanations below identify any other significant or unusual items affecting the results of operations. PHI consolidated results includes Potomac Electric Power Company, Delmarva Power & Light Company, and Atlantic City Electric Company.

(a)	Results reported in accordance with GAAP.

(b)

Adjustment to exclude certain costs associated with mergers and acquisitions, including, if and when applicable, professional fees, employee-related expenses, integration activities, and upfront credit facilities fees, partially offset in 2016 at PHI by the anticipated recovery of previously incurred PHI acquisition costs.

(c)	Adjustment to exclude costs incurred as part of the settlement orders approving the PHI acquisition.

EXELON CORPORATION

Reconciliation of Adjusted (non-GAAP) Operating Earnings to

GAAP Consolidated Statements of Operations

(unaudited)

(in millions)


	Other (a)
	Three Months Ended June 30, 2016										Three Months Ended June 30, 2015
	GAAP (b)			Adjustments				Adjusted Non-GAAP			GAAP (b)			Adjustments				Adjusted Non-GAAP
Operating revenues	$	(375	)	$	—			$	(375	)	$	(155	)	$	—			$	(155	)
Operating expenses
Purchased power and fuel		(356	)		—				(356	)		(151	)		—				(151	)
Operating and maintenance		(37	)		—				(37	)		9			(28	)	(c),(g)		(19	)
Depreciation and amortization		19			—				19			14			—				14
Taxes other than income		10			—				10			8			—				8

Total operating expenses		(364	)		—				(364	)		(120	)		(28	)			(148	)

Operating loss		(11	)		—				(11	)		(35	)		28				(7	)

Other income and (deductions)
Interest expense, net		(65	)		—				(65	)		77			(104	)	(c),(f)		(27	)
Other, net		6			—				6			4			—				4

Total other income and (deductions)		(59	)		—				(59	)		81			(104	)			(23	)

Loss before income taxes		(70	)		—				(70	)		46			(76	)			(30	)
Income taxes		(16	)		—				(16	)		19			(31	)	(c),(e),(f),(g)		(12	)
Equity in earnings of unconsolidated affiliates		1			—				1			—			—				—

Net (loss) income	$	(53	)	$	—			$	(53	)	$	27		$	(45	)		$	(18	)


	Six Months Ended June 30, 2016										Six Months Ended June 30, 2015
	GAAP (b)			Adjustments				Adjusted Non-GAAP			GAAP (b)			Adjustments				Adjusted Non-GAAP
Operating revenues	$	(664	)	$	—			$	(664	)	$	(372	)	$	—			$	(372	)
Operating expenses
Purchased power and fuel		(623	)		—				(623	)		(365	)		—				(365	)
Operating and maintenance		98			(178	)	(c),(d)		(80	)		(3	)		(35	)	(c),(g)		(38	)
Depreciation and amortization		36			—				36			28			—				28
Taxes other than income		18			—				18			15			—				15

Total operating expenses		(471	)		(178	)			(649	)		(325	)		(35	)			(360	)
Gain on sales of assets		4			—				4			1			—				1

Operating loss		(189	)		178				(11	)		(46	)		35				(11	)

Other income and (deductions)
Interest expense, net		(109	)		—				(109	)		(29	)		(15	)	(c),(f)		(44	)
Other, net		14			—				14			(18	)		—				(18	)

Total other income and (deductions)		(95	)		—				(95	)		(47	)		(15	)			(62	)

Loss before income taxes		(284	)		178				(106	)		(93	)		20				(73	)
Income taxes		(66	)		33		(c),(d),(h)		(33	)		(34	)		5		(c),(e),(f),(g)		(29	)
Equity in earnings of unconsolidated affiliates		1			—				1			1			—				1

Net loss		(217	)		145				(72	)		(58	)		15				(43	)
Net income attributable to noncontrolling interests and preference stock dividends		1			—				1			1			—				1

Net loss attributable to common shareholders	$	(218	)	$	145			$	(73	)	$	(59	)	$	15			$	(44	)

(a)	Other primarily includes eliminating and consolidating adjustments, Exelon’s corporate operations, shared service entities and other financing and investment activities.

(b)	Results reported in accordance with GAAP.

(c)	Adjustment to exclude certain costs associated with mergers and acquisitions, including, if and when applicable, professional fees, employee-related expenses, integration activities, and upfront credit facilities fees.

(d)	Adjustment to exclude costs incurred as part of the settlement orders approving the PHI acquisition.

(e)	Adjustment to exclude the mark-to-market impact of Exelon’s economic hedging activities, net of intercompany eliminations.

(f)	Adjustment to exclude the mark-to-market impact of Exelon’s Corporate’s forward-starting interest rate swaps related to financing for the PHI acquisition, which were terminated on June 8, 2015.

(g)	Adjustment to exclude a 2015 charge to earnings primarily related to the impairment of investment in long-term leases.

(h)	Adjustment to exclude the non-cash impact of the remeasurement of state deferred income taxes, primarily as a result of changes in forecasted apportionment related to the PHI acquisition in 2016.

EXELON CORPORATION

Exelon Generation Statistics


	Three Months Ended
	June 30, 2016		March 31, 2016		December 31, 2015		September 30, 2015		June 30, 2015
Supply (in GWhs)
Nuclear Generation
Mid-Atlantic^(a)		15,224		16,208		15,500		16,446		15,619
Midwest		23,001		23,662		23,620		23,927		23,448
New York^(a)		4,228		4,932		4,712		4,807		4,738

Total Nuclear Generation		42,453		44,802		43,832		45,180		43,805
Fossil and Renewables
Mid-Atlantic		685		898		746		719		750
Midwest		324		449		490		262		363
New England		2,016		1,924		408		1,840		135
New York		1		1		—		1		1
ERCOT		1,879		1,376		1,163		2,306		872
Other^(b)		1,995		2,147		1,834		1,945		2,096

Total Fossil and Renewables		6,900		6,795		4,641		7,073		4,217
Purchased Power
Mid-Atlantic		3,131		3,755		1,441		3,511		1,384
Midwest		688		706		814		515		407
New England		3,782		4,155		6,372		5,787		5,742
ERCOT		2,259		2,294		2,501		2,422		2,903
Other^(b)		3,879		2,600		4,636		5,812		4,616

Total Purchased Power		13,739		13,510		15,764		18,047		15,052
Total Supply/Sales by Region^(c)
Mid-Atlantic^(d)		19,040		20,861		17,687		20,676		17,753
Midwest^(d)		24,013		24,817		24,924		24,704		24,218
New England		5,798		6,079		6,780		7,627		5,877
New York		4,229		4,933		4,712		4,808		4,739
ERCOT		4,138		3,670		3,664		4,728		3,775
Other^(b)		5,874		4,747		6,470		7,757		6,712

Total Supply/Sales by Region		63,092		65,107		64,237		70,300		63,074


	Three Months Ended
	June 30, 2016		March 31, 2016		December 31, 2015		September 30, 2015		June 30, 2015
Outage Days^(e)
Refueling		87		70		103		27		71
Non-refueling		21		10		21		11		18

Total Outage Days		108		80		124		38		89

(a)	Includes the proportionate share of output where Generation has an undivided ownership interest in jointly-owned generating plants and includes the total output of plants that are fully consolidated (e.g. CENG).

(b)	Other Regions includes, South, West and Canada, which are not considered individually significant.

(c)	Excludes physical proprietary trading volumes of 1,289 GWhs, 1,220 GWhs, 1,932 GWhs, 1,913 GWhs, and 1,657 GWhs for the three months ended June 30, 2016, March 31, 2016, December 31, 2015, September 30, 2015, and June 30, 2015 respectively.

(d)

Includes affiliate sales to PECO and BGE in the Mid-Atlantic region and affiliate sales to ComEd in the Midwest region. As a result of the PHI Merger, includes affiliate sales to Pepco, DPL and ACE in the Mid-Atlantic region for the Successor period of March 24, 2016 to March 30, 2016 and April 1, 2016 to June 30, 2016.

(e)	Outage days exclude Salem.

EXELON CORPORATION

Exelon Generation Statistics

Six Months Ended June 30, 2016 and 2015


	June 30, 2016		June 30, 2015
Supply (in GWhs)
Nuclear Generation
Mid-Atlantic^(a)		31,432		31,337
Midwest		46,663		45,875
New York^(a)		9,160		9,250

Total Nuclear Generation		87,255		86,462
Fossil and Renewables
Mid-Atlantic		1,583		1,309
Midwest		773		795
New England		3,940		735
New York		2		2
ERCOT		3,255		2,294
Other		4,142		4,069

Total Fossil and Renewables		13,695		9,204
Purchased Power
Mid-Atlantic		6,886		3,208
Midwest		1,394		996
New England		7,937		12,150
ERCOT		4,553		5,147
Other		6,479		8,374

Total Purchased Power		27,249		29,875
Total Supply/Sales by Region^(c)
Mid-Atlantic^(b)		39,901		35,854
Midwest^(b)		48,830		47,666
New England		11,877		12,885
New York		9,162		9,252
ERCOT		7,808		7,441
Other		10,621		12,443

Total Supply/Sales by Region		128,199		125,541

(a)	Includes the proportionate share of output where Generation has an undivided ownership interest in jointly-owned generating plants and includes the total output of plants that are fully consolidated (e.g. CENG).

(b)	Includes affiliate sales to PECO and BGE in the Mid-Atlantic region and affiliate sales to ComEd in the Midwest region. As a result of the PHI Merger, includes affiliate sales to Pepco, DPL and ACE in the Mid-Atlantic region for the Successor period of March 24, 2016 to June 30, 2016.

(c)	Excludes physical proprietary trading volumes of 2,509 GWh and 3,465 GWh for the six months ended June 30, 2016 and 2015, respectively.

EXELON CORPORATION

ComEd Statistics

Three Months Ended June 30, 2016 and 2015


	Electric Deliveries (in GWhs)										Revenue (in millions)
	2016		2015		% Change			Weather- Normal % Change			2016		2015		% Change
Retail Deliveries and Sales (a)
Residential		6,349		5,685		11.7	%		1.2	%	$	625	$	527		18.6	%
Small Commercial & Industrial		7,735		7,566		2.2	%		0.2	%		329		330		(0.3	)%
Large Commercial & Industrial		6,736		6,680		0.8	%		(0.5	)%		116		109		6.4	%
Public Authorities & Electric Railroads		277		290		(4.5	)%		(4.5	)%		11		11		—	%

Total Retail		21,097		20,221		4.3	%		0.2	%		1,081		977		10.6	%

Other Revenue (b)												205		171		19.9	%

Total Electric Revenue (c)											$	1,286	$	1,148		12.0	%

Purchased Power											$	339	$	275		23.3	%


							% Change
	2016		2015		Normal		From 2015			From Normal
Heating and Cooling Degree-Days
Heating Degree-Days		755		686		765		10.1	%		(1.3	)%
Cooling Degree-Days		290		171		218		69.6	%		33.0	%

Six Months Ended June 30, 2016 and 2015


	Electric Deliveries (in GWhs)										Revenue (in millions)
	2016		2015		% Change			Weather- Normal % Change			2016		2015		% Change
Retail Deliveries and Sales (a)
Residential		12,725		12,682		0.3	%		(0.8	)%	$	1,232	$	1,096		12.4	%
Small Commercial & Industrial		15,615		15,727		(0.7	)%		—	%		651		667		(2.4	)%
Large Commercial & Industrial		13,493		13,557		(0.5	)%		0.4	%		224		218		2.8	%
Public Authorities & Electric Railroads		639		669		(4.5	)%		(2.4	)%		23		23		—	%

Total Retail		42,472		42,635		(0.4	)%		(0.1	)%		2,130		2,004		6.3	%

Other Revenue (b)												405		329		23.1	%

Total Electric Revenue (c)											$	2,535	$	2,333		8.7	%

Purchased Power											$	686	$	601		14.1	%


							% Change
	2016		2015		Normal		From 2015			From Normal
Heating and Cooling Degree-Days
Heating Degree-Days		3,655		4,318		3,929		(15.4	)%		(7.0	)%
Cooling Degree-Days		290		171		218		69.6	%		33.0	%


	2016		2015
Number of Electric Customers
Residential		3,570,528		3,511,058
Small Commercial & Industrial		372,354		369,255
Large Commercial & Industrial		1,972		1,976
Public Authorities & Electric Railroads		4,749		4,833

Total		3,949,603		3,887,122

(a)

Reflects delivery volumes and revenues from customers purchasing electricity directly from ComEd and customers purchasing electricity from a competitive electric generation supplier, as all customers are assessed delivery charges. For customers purchasing electricity from ComEd, revenue also reflects the cost of energy and transmission.

(b)	Other revenue primarily includes transmission revenue from PJM. Other revenue includes rental revenues, revenues related to late payment charges, revenues from other utilities for mutual assistance programs and recoveries of remediation costs associated with MGP sites.

(c)	Includes operating revenues from affiliates totaling $3 million and $1 million for the three months ended June 30, 2016 and 2015, and $8 million and $2 million for the six months ended June 30, 2016 and 2015, respectively.

EXELON CORPORATION

PECO Statistics

Three Months Ended June 30, 2016 and 2015


	Electric and Natural Gas Deliveries										Revenue (in millions)
	2016		2015		% Change			Weather- Normal % Change			2016		2015		% Change
Electric (in GWhs)
Retail Deliveries and Sales (a)
Residential		2,909		3,021		(3.7	)%		1.1	%	$	355	$	365		(2.7	)%
Small Commercial & Industrial		1,887		1,925		(2.0	)%		(0.3	)%		106		102		3.9	%
Large Commercial & Industrial		3,770		3,784		(0.4	)%		0.3	%		65		54		20.4	%
Public Authorities & Electric Railroads		205		214		(4.2	)%		(4.2	)%		9		8		12.5	%

Total Retail		8,771		8,944		(1.9	)%		0.3	%		535		529		1.1	%

Other Revenue (b)												52		53		(1.9	)%

Total Electric Revenue (d)												587		582		0.9	%

Natural Gas (in mmcfs)
Retail Deliveries and Sales
Retail Sales (c)		7,883		7,233		9.0	%		(6.7	)%		70		72		(2.8	)%
Transportation and Other		5,906		5,431		8.7	%		6.0	%		7		7		—	%

Total Natural Gas (d)		13,789		12,664		8.9	%		(1.5	)%		77		79		(2.5	)%

Total Electric and Natural Gas Revenues											$	664	$	661		0.5	%

Purchased Power and Fuel											$	217	$	237		(8.4	)%


							% Change
	2016		2015		Normal		From 2015			From Normal
Heating and Cooling Degree-Days
Heating Degree-Days		469		330		466		42.1	%		0.6	%
Cooling Degree-Days		391		513		348		(23.8	)%		12.4	%

Six Months Ended June 30, 2016 and 2015


	Electric and Natural Gas Deliveries										Revenue (in millions)
	2016		2015		% Change			Weather- Normal % Change			2016		2015		% Change
Electric (in GWhs)
Retail Deliveries and Sales (a)
Residential		6,324		6,989		(9.5	)%		1.2	%	$	766	$	815		(6.0	)%
Small Commercial & Industrial		3,912		4,087		(4.3	)%		2.3	%		225		217		3.7	%
Large Commercial & Industrial		7,364		7,517		(2.0	)%		(1.4	)%		123		108		13.9	%
Public Authorities & Electric Railroads		432		443		(2.5	)%		(2.5	)%		17		15		13.3	%

Total Retail		18,032		19,036		(5.3	)%		0.3	%		1,131		1,155		(2.1	)%

Other Revenue (b)												101		104		(2.9	)%

Total Electric Revenue (d)												1,232		1,259		(2.1	)%

Natural Gas (in mmcfs)
Retail Deliveries and Sales
Retail Sales (c)		34,994		42,095		(16.9	)%		2.2	%		256		368		(30.4	)%
Transportation and Other		13,602		14,128		(3.7	)%		3.3	%		17		19		(10.5	)%

Total Natural Gas (d)		48,596		56,223		(13.6	)%		2.5	%		273		387		(29.5	)%

Total Electric and Natural Gas Revenues											$	1,505	$	1,646		(8.6	)%

Purchased Power and Fuel											$	537	$	675		(20.4	)%


							% Change
	2016		2015		Normal		From 2015			From Normal
Heating and Cooling Degree-Days
Heating Degree-Days		2,606		3,264		2,943		(20.2	)%		(11.5	)%
Cooling Degree-Days		396		513		349		(22.8	)%		13.5	%


Number of Electric Customers	2016		2015		Number of Natural Gas Customers	2016		2015
Residential		1,449,450		1,437,523	Residential		469,230		464,333
Small Commercial & Industrial		149,523		148,918	Commercial & Industrial		43,046		42,603

Large Commercial & Industrial		3,088		3,095	Total Retail		512,276		506,936
Public Authorities & Electric Railroads		9,813		9,803	Transportation		811		845

Total		1,611,874		1,599,339	Total		513,087		507,781

(a)

Reflects delivery volumes and revenues from customers purchasing electricity directly from PECO and customers purchasing electricity from a competitive electric generation supplier as all customers are assessed distribution charges. For customers purchasing electricity from PECO, revenue also reflects the cost of energy and transmission.

(b)	Other revenue includes transmission revenue from PJM and wholesale electric revenues.

(c)

Reflects delivery volumes and revenues from customers purchasing natural gas directly from PECO and customers purchasing natural gas from a competitive natural gas supplier as all customers are assessed distribution charges. For customers purchasing natural gas from PECO, revenue also reflects the cost of natural gas.

(d)

Total electric revenue includes operating revenues from affiliates totaling $2 million and less than $1 million for the three months ended June 30, 2016 and 2015, respectively, and $4 million and less than $1 million for the six months ended June 30, 2016 and 2015, respectively. Total natural gas revenues includes operating revenues from affiliates totaling less than $1 million for both the three months ended June 30, 2016 and 2015, and the six months ended June 30, 2016, and $1 million for the six months ended June 30, 2015.

EXELON CORPORATION

BGE Statistics

Three Months Ended June 30, 2016 and 2015


	Electric and Natural Gas Deliveries							Revenue (in millions)
	2016		2015		% Change			2016		2015		% Change
Electric (in GWhs)
Retail Deliveries and Sales (a)
Residential		2,616		2,635		(0.7	)%	$	324	$	303		6.9	%
Small Commercial & Industrial		692		780		(11.3	)%		65		61		6.6	%
Large Commercial & Industrial		3,417		3,467		(1.4	)%		115		109		5.5	%
Public Authorities & Electric Railroads		72		74		(2.7	)%		9		8		12.5	%

Total Retail		6,797		6,956		(2.3	)%		513		481		6.7	%

Other Revenue (b)(c)									71		60		18.3	%

Total Electric Revenue									584		541		7.9	%

Natural Gas (in mmcfs)
Retail Deliveries and Sales (d)
Retail Sales		17,672		13,885		27.3	%		93		85		9.4	%
Transportation and Other (e)		271		585		(53.7	)%		3		2		50.0	%

Total Natural Gas (f)		17,943		14,470		24.0	%		96		87		10.3	%

Total Electric and Natural Gas Revenues								$	680	$	628		8.3	%

Purchased Power and Fuel								$	261	$	239		9.2	%


							% Change
	2016		2015		Normal		From 2015			From Normal
Heating and Cooling Degree-Days
Heating Degree-Days		574		422		509		36.0	%		12.8	%
Cooling Degree-Days		219		317		257		(30.9	)%		(14.8	)%

Six Months Ended June 30, 2016 and 2015


	Electric and Natural Gas Deliveries							Revenue (in millions)
	2016		2015		% Change			2016		2015		% Change
Electric (in GWhs)
Retail Deliveries and Sales (a)
Residential		6,095		6,808		(10.5	)%	$	753	$	752		0.1	%
Small Commercial & Industrial		1,466		1,625		(9.8	)%		137		137		—	%
Large Commercial & Industrial		6,635		6,906		(3.9	)%		215		229		(6.1	)%
Public Authorities & Electric Railroads		143		149		(4.0	)%		18		16		12.5	%

Total Retail		14,339		15,488		(7.4	)%		1,123		1,134		(1.0	)%

Other Revenue (b)(c)									141		120		17.5	%

Total Electric Revenue									1,264		1,254		0.8	%

Natural Gas (in mmcfs)
Retail Deliveries and Sales (d)
Retail Sales		56,256		60,762		(7.4	)%		331		384		(13.8	)%
Transportation and Other (e)		2,767		3,909		(29.2	)%		14		26		(46.2	)%

Total Natural Gas (f)		59,023		64,671		(8.7	)%		345		410		(15.9	)%

Total Electric and Natural Gas Revenues								$	1,609	$	1,664		(3.3	)%

Purchased Power and Fuel								$	634	$	726		(12.7	)%


							% Change
	2016		2015		Normal		From 2015			From Normal
Heating and Cooling Degree-Days
Heating Degree-Days		2,854		3,372		2,920		(15.4	)%		(2.3	)%
Cooling Degree-Days		219		317		257		(30.9	)%		(14.8	)%


Number of Electric Customers	2016		2015		Number of Natural Gas Customers	2016		2015
Residential		1,142,073		1,132,325	Residential		618,268		614,168
Small Commercial & Industrial		112,980		112,951	Commercial & Industrial		44,078		44,004

Large Commercial & Industrial		11,980		11,820	Total Retail		662,346		658,172
Public Authorities & Electric Railroads		281		286	Transportation		—		—

Total		1,267,314		1,257,382	Total		662,346		658,172

(a)

Reflects delivery volumes and revenues from customers purchasing electricity directly from BGE and customers purchasing electricity from a competitive electric generation supplier as all customers are assessed distribution charges. For customers purchasing electricity from BGE, revenue also reflects the cost of energy and transmission.

(b)	Other revenue includes wholesale transmission revenue and late payment charges.

(c)	Includes operating revenues from affiliates totaling $2 million and $4 million for the three and six months ended June 30, 2016.

(d)

Reflects delivery volumes and revenues from customers purchasing natural gas directly from BGE and customers purchasing natural gas from a competitive natural gas supplier as all customers are assessed distribution charges. For customers purchasing natural gas from BGE, revenue also reflects the cost of natural gas.

(e)

Transportation and other natural gas revenue includes off-system revenue of 271 mmcfs ($2 million) and 585 mmcfs ($3 million) for the three months ended June 30, 2016 and 2015, respectively. Transportation and other natural gas revenue includes off-system revenue of 2,767 mmcfs ($11 million) and 3,909 mmcfs ($25 million) for the six months ended June 30, 2016 and 2015, respectively.

(f)	Includes operating revenues from affiliates totaling $2 million and $1 million for the three months ended June 30, 2016 and 2015, respectively, and $5 million and $8 million for the six months ended June 30, 2016 and 2015, respectively.

EXELON CORPORATION

PEPCO Statistics

Three Months Ended June 30, 2016 and 2015


	Electric Deliveries							Revenue (in millions)
	2016		2015		% Change			2016		2015		% Change
Electric (in GWhs)
Retail Deliveries and Sales (a)
Residential		1,760		1,899		(7.3	)%	$	220	$	220		—	%
Small Commercial & Industrial		348		307		13.4	%		36		36		—	%
Large Commercial & Industrial		3,631		3,897		(6.8	)%		195		193		1.0	%
Public Authorities & Electric Railroads		176		179		(1.7	)%		8		8		—	%

Total Retail		5,915		6,282		(5.8	)%		459		457		0.4	%

Other Revenue (b)									50		47		6.4	%

Total Electric Revenue (c)									509		504		1.0	%

Purchased Power								$	152	$	162		(6.2	)%


							% Change
	2016		2015		Normal		From 2015			From Normal
Heating and Cooling Degree-Days
Heating Degree-Days		397		200		324		98.5	%		22.5	%
Cooling Degree-Days		452		676		475		(33.1	)%		(4.8	)%

Six Months Ended June 30, 2016 and 2015


	Electric Deliveries							Revenue (in millions)
	2016		2015		% Change			2016		2015		% Change
Electric (in GWhs)
Retail Deliveries and Sales (a)
Residential		3,978		4,489		(11.4	)%	$	476	$	486		(2.1	)%
Small Commercial & Industrial		730		771		(5.3	)%		73		73		—	%
Large Commercial & Industrial		7,576		7,505		0.9	%		395		379		4.2	%
Public Authorities & Electric Railroads		364		363		0.3	%		16		16		—	%

Total Retail		12,648		13,128		(3.7	)%		960		954		0.6	%

Other Revenue (b)									101		95		6.3	%

Total Electric Revenue (c)									1,061		1,049		1.1	%

Purchased Power								$	351	$	373		(5.9	)%


							% Change
	2016		2015		Normal		From 2015			From Normal
Heating and Cooling Degree-Days
Heating Degree-Days		2,407		2,691		2,494		(10.6	)%		(3.5	)%
Cooling Degree-Days		454		676		478		(32.8	)%		(5.0	)%


	2016		2015
Number of Electric Customers
Residential		771,541		739,440
Small Commercial & Industrial		53,345		53,413
Large Commercial & Industrial		21,401		20,515
Public Authorities & Electric Railroads		127		121

Total		846,414		813,489

(a)

Reflects delivery volumes and revenues from customers purchasing electricity directly from Pepco and customers purchasing electricity from a competitive electric generation supplier as all customers are assessed distribution charges. For customers purchasing electricity from Pepco, revenue also reflects the cost of energy and transmission.

(b)	Other revenue includes transmission revenue from PJM and wholesale electric revenues.

(c)	Includes operating revenues from affiliates totaling $1 million and $1 million for the three months ended June 30, 2016 and 2015, respectively, and $3 million and $2 million for the six months ended June 30, 2016 and 2015, respectively.

EXELON CORPORATION

DPL Statistics

Three Months Ended June 30, 2016 and 2015


	Electric and Natural Gas Deliveries							Revenue (in millions)
	2016		2015		% Change			2016		2015		% Change
Electric (in GWhs)
Retail Deliveries and Sales (a)
Residential		1,038		1,009		2.9	%	$	143	$	134		6.7	%
Small Commercial & Industrial		532		675		(21.2	)%		46		44		4.5	%
Large Commercial & Industrial		1,164		1,159		0.4	%		25		30		(16.7	)%
Public Authorities & Electric Railroads		12		10		20.0	%		3		3		—	%

Total Retail		2,746		2,853		(3.8	)%		217		211		2.8	%

Other Revenue (b)									38		35		8.6	%

Total Electric Revenue (c)									255		246		3.7	%

Natural Gas (in mmcfs)
Retail Deliveries and Sales (d)
Retail Sales		2,072		1,731		19.7	%		21		20		5.0	%
Transportation and Other (e)		1,321		1,247		5.9	%		5		5		—	%

Total Natural Gas		3,393		2,978		13.9	%		26		25		4.0	%

Total Electric and Natural Gas Revenues								$	281	$	271		3.7	%

Purchased Power and Fuel								$	261	$	239		9.2	%


							% Change
	2016		2015		Normal		From 2015			From Normal
Heating and Cooling Degree-Days
Heating Degree-Days		551		408		490		35.0	%		12.4	%
Cooling Degree-Days		304		418		327		(27.3	)%		(7.0	)%

Six Months Ended June 30, 2016 and 2015


	Electric and Natural Gas Deliveries							Revenue (in millions)
	2016		2015		% Change			2016		2015		% Change
Electric (in GWhs)
Retail Deliveries and Sales (a)
Residential		2,465		2,872		(14.2	)%	$	323	$	350		(7.7	)%
Small Commercial & Industrial		1,104		1,185		(6.8	)%		95		94		1.1	%
Large Commercial & Industrial		2,242		2,267		(1.1	)%		50		53		(5.7	)%
Public Authorities & Electric Railroads		26		23		13.0	%		7		6		16.7	%

Total Retail		5,837		6,347		(8.0	)%		475		503		(5.6	)%

Other Revenue (b)									83		77		7.8	%

Total Electric Revenue (c)									558		580		(3.8	)%

Natural Gas (in mmcfs)
Retail Deliveries and Sales (d)
Retail Sales		8,132		9,609		(15.4	)%		74		99		(25.3	)%
Transportation and Other (e)		3,289		3,572		(7.9	)%		11		12		(8.3	)%

Total Natural Gas		11,421		13,181		(13.4	)%		85		111		(23.4	)%

Total Electric and Natural Gas Revenues								$	643	$	691		(6.9	)%

Purchased Power and Fuel								$	298	$	350		(14.9	)%


							% Change
	2016		2015		Normal		From 2015			From Normal
Heating and Cooling Degree-Days
Heating Degree-Days		2,798		3,273		2,939		(14.5	)%		(4.8	)%
Cooling Degree-Days		307		418		328		(26.6	)%		(6.4	)%


Number of Electric Customers	2016		2015		Number of Natural Gas Customers	2016		2015
Residential		454,402		453,664	Residential		119,592		118,881
Small Commercial & Industrial		59,904		59,466	Commercial & Industrial		9,669		9,597

Large Commercial & Industrial		1,417		1,418	Total Retail		129,261		128,478
Public Authorities & Electric Railroads		643		645	Transportation		157		161

Total		516,366		515,193	Total		129,418		128,639

(a)

Reflects delivery volumes and revenues from customers purchasing electricity directly from DPL and customers purchasing electricity from a competitive electric generation supplier as all customers are assessed distribution charges. For customers purchasing electricity from DPL, revenue also reflects the cost of energy and transmission.

(b)	Other revenue includes transmission revenue from PJM and wholesale electric revenues.

(c)	Includes operating revenues from affiliates totaling $2 million and $2 million for the three months ended June 30, 2016 and 2015, respectively, and $4 million and $3 million for the six months ended June 30, 2016 and 2015, respectively.

(d)

Reflects delivery volumes and revenues from customers purchasing natural gas directly from DPL and customers purchasing natural gas from a competitive natural gas supplier as all customers are assessed distribution charges. For customers purchasing natural gas from DPL, revenue also reflects the cost of natural gas.

(e)	Transportation and other revenue includes off-system natural gas sales and the short-term release of interstate pipeline transportation and storage capacity not needed to serve customers.

EXELON CORPORATION

ACE Statistics

Three Months Ended June 30, 2016 and 2015


	Electric Deliveries							Revenue (in millions)
	2016		2015		% Change			2016		2015		% Change
Electric (in GWhs)
Retail Deliveries and Sales (a)
Residential		814		908		(10.4	)%	$	131	$	147		(10.9	)%
Small Commercial & Industrial		283		306		(7.5	)%		39		42		(7.1	)%
Large Commercial & Industrial		853		920		(7.3	)%		50		50		—	%
Public Authorities & Electric Railroads		9		11		(18.2	)%		3		3		—	%

Total Retail		1,959		2,145		(8.7	)%		223		242		(7.9	)%

Other Revenue (b)									47		43		9.3	%

Total Electric Revenue (c)									270		285		(5.3	)%

Purchased Power and Fuel								$	261	$	239		9.2	%


							% Change
	2016		2015		Normal		From 2015			From Normal
Heating and Cooling Degree-Days
Heating Degree-Days		651		483		576		34.8	%		13.0	%
Cooling Degree-Days		258		366		285		(29.5	)%		(9.5	)%

Six Months Ended June 30, 2016 and 2015


	Electric Deliveries							Revenue (in millions)
	2016		2015		% Change			2016		2015		% Change
Electric (in GWhs)
Retail Deliveries and Sales (a)
Residential		1,752		2,032		(13.8	)%	$	281	$	322		(12.7	)%
Small Commercial & Industrial		572		611		(6.4	)%		78		82		(4.9	)%
Large Commercial & Industrial		1,673		1,736		(3.6	)%		101		99		2.0	%
Public Authorities & Electric Railroads		24		23		4.3	%		6		6		—	%

Total Retail		4,021		4,402		(8.7	)%		466		509		(8.4	)%

Other Revenue (b)									95		109		(12.8	)%

Total Electric Revenue (c)									561		618		(9.2	)%

Purchased Power								$	298	$	338		(11.8	)%


							% Change
	2016		2015		Normal		From 2015			From Normal
Heating and Cooling Degree-Days
Heating Degree-Days		2,921		3,524		3,099		(17.1	)%		(5.7	)%
Cooling Degree-Days		261		366		286		(28.7	)%		(8.7	)%


	2016		2015
Number of Electric Customers
Residential		483,044		483,024
Small Commercial & Industrial		60,928		60,915
Large Commercial & Industrial		3,806		3,859
Public Authorities & Electric Railroads		594		549

Total		548,372		548,347

(a)

Reflects delivery volumes and revenues from customers purchasing electricity directly from ACE and customers purchasing electricity from a competitive electric generation supplier as all customers are assessed distribution charges. For customers purchasing electricity from ACE, revenue also reflects the cost of energy and transmission.

(b)	Other revenue includes transmission revenue from PJM and wholesale electric revenues.

(c)	Includes operating revenues from affiliates totaling $1 million and $1 million for the three months ended June 30, 2016 and 2015, respectively, and $2 million and $2 million for the six months ended June 30, 2016 and 2015, respectively.