Earnings Release Highlights

GAAP Net Income of $0.34 per share and Adjusted (non-GAAP) Operating Earnings of $0.41 per share for the second quarter of 2023
Reaffirming full year 2023 Adjusted (non-GAAP) Operating Earnings guidance range of $2.30-$2.42 per share
Reaffirming fully regulated operating EPS compounded annual growth target of 6-8% from 2021 and 2022 guidance midpoints through 2025 and 2026, respectively, with expectation to be at midpoint or better of growth range
Strong utility reliability performance – every utility achieved top quartile in outage duration and outage frequency, and ComEd, PECO, and PHI delivered best-on-record performance for the second straight quarter
Pepco submitted its three-year multi-year plan application with proposed 9-month extension to the Maryland Public Service Commission (MDPSC) in May seeking an increase in base rates over the period of 2024 to 2027 to support a climate ready grid and enable cleaner energy programs and technologies that support the state's goal to reach net-zero emissions by 2045

Exelon Corporation (NASDAQ:EXC) today reported its financial results for the second quarter of 2023.

"In the second quarter, we reported solid financial results, and our local energy companies across the country continue to prove that they are best in class – with three of our four operating companies having best-on-record performance in outage frequency and outage duration last quarter," said Exelon President and CEO, Calvin Butler. "We deliver this performance while remaining steadfast in our commitment to a sustainable energy future. We are modernizing the grid, enabling further electrification and decarbonization. I'm confident we will continue strengthening Exelon's financial position while prioritizing the health of our customers and communities."

"Exelon's performance remained strong into the second quarter of the year, reporting Adjusted (non-GAAP) Operating Earnings of $0.41 per share, which is in line with expectations," said Exelon Executive Vice President and CFO Jeanne Jones. "Through the first half of 2023, we have deployed $3.6B of investments needed to lead the energy transformation for our customers. We look forward to closing out the second half of 2023 equally strong executing on the remaining $7.2 billion of investments. We reaffirm our full year Adjusted (non-GAAP) Operating Earnings guidance range of $2.30 to $2.42 per share."

Second Quarter 2023

Exelon's GAAP Net Income from Continuing Operations for the second quarter of 2023 decreased to $0.34 per share from $0.47 GAAP Net Income from Continuing Operations per share in the second quarter of 2022. Adjusted (non-GAAP) Operating Earnings for the second quarter of 2023 decreased to $0.41 per share from $0.44 per share in the second quarter of 2022. For the reconciliations of GAAP Net Income from Continuing Operations to Adjusted (non-GAAP) Operating Earnings, refer to the tables beginning on page 4.

Adjusted (non-GAAP) Operating Earnings in the second quarter of 2023 primarily reflect:

Consistent utility earnings primarily due to higher electric distribution formula rate earnings at ComEd from higher allowed ROE due to an increase in U.S. treasury rates and the impacts of higher rate base, rate increases at PECO, BGE, and PHI, and carrying costs related to the carbon mitigation credit (CMC) regulatory asset at ComEd. This was partially offset by unfavorable weather at PECO, higher depreciation expense at PECO, and higher interest expense at BGE.
Higher costs at the Exelon holding company primarily due to higher interest expense.

Operating Company Results¹

ComEd

ComEd's second quarter of 2023 GAAP Net Income increased to $249 million from $227 million in the second quarter of 2022. ComEd's Adjusted (non-GAAP) Operating Earnings for the second quarter of 2023 increased to $251 million from $229 million in the second quarter of 2022, primarily due to increases in electric distribution formula rate earnings (reflecting higher allowed ROE due to an increase in U.S. Treasury rates and the impacts of higher rate base) and carrying costs related to the CMC regulatory asset. Due to revenue decoupling, ComEd's distribution earnings are not affected by actual weather or customer usage patterns.

PECO

PECO's second quarter of 2023 GAAP Net Income decreased to $97 million from $133 million in the second quarter of 2022. PECO's Adjusted (non-GAAP) Operating Earnings for the second quarter of 2023 decreased to $98 million from $134 million in the second quarter of 2022, primarily due to unfavorable weather and an increase in depreciation expense, partially offset by gas distribution rate increases.

BGE

BGE's second quarter of 2023 GAAP Net Income increased to $42 million from $37 million in the second quarter of 2022. BGE's Adjusted (non-GAAP) Operating Earnings for the second quarter of 2023 increased to $43 million from $38 million in the second quarter of 2022, primarily due to favorable impacts of the multi-year plans, offset by an increase in interest expense. Due to revenue decoupling, BGE's distribution earnings are not affected by actual weather or customer usage patterns.

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¹Exelon's four business units include ComEd, which consists of electricity transmission and distribution operations in northern Illinois; PECO, which consists of electricity transmission and distribution operations and retail natural gas distribution operations in southeastern Pennsylvania; BGE, which consists of electricity transmission and distribution operations and retail natural gas distribution operations in central Maryland; and PHI, which 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

PHI's second quarter of 2023 GAAP Net Income increased to $103 million from $100 million in the second quarter of 2022. PHI's Adjusted (non-GAAP) Operating Earnings for the second quarter of 2023 increased to $115 million from $101 million in the second quarter of 2022, primarily due to distribution and transmission rate increases. Due to revenue decoupling, PHI's distribution earnings related to Pepco Maryland, DPL Maryland, Pepco District of Columbia, and ACE are not affected by actual weather or customer usage patterns.

Recent Developments and Second Quarter Highlights

Pepco Maryland Electric Rate Case: On May 16, 2023, Pepco filed an application for a three-year cumulative multi-year plan for April 1, 2024 through March 31, 2027, with the MDPSC. Pepco requested total electric revenue requirement increases of $74 million, $60 million, and $60 million in 2024, 2025, and 2026, respectively. The plan contains a proposed nine-month extension period with a requested revenue requirement increase of $20 million effective April 1, 2027 through December 31, 2027. The electric revenue requirement increases reflect a requested ROE of 10.5%. Requested revenue requirement increases will be used to recover capital investments designed to advance system-readiness and support Maryland's climate and clean energy goals.
Financing Activities:

On May 9, 2023, ComEd entered into a 364-day term loan agreement for $400 million with a variable rate equal to SOFR plus 1.00% and an expiration date of May 7, 2024. The proceeds from this loan were used to repay outstanding commercial paper obligations and for general corporate purposes.
On June 23, 2023, PECO issued $575 million aggregate principal amounts of its First and Refunding Mortgage Bonds, 4.90% Series due June 15, 2033. PECO used the proceeds to refinance existing indebtedness, refinance outstanding commercial paper obligations, and for general corporate purposes.
On May 10, 2023, BGE issued $700 million aggregate principal amount of its 5.40% notes due June 1, 2053. BGE used the proceeds to repay outstanding commercial paper obligations, repay existing indebtedness, and for general corporate purposes.

GAAP/Adjusted (non-GAAP) Operating Earnings Reconciliation

Adjusted (non-GAAP) Operating Earnings for the second quarter of 2023 do not include the following items (after tax) that were included in reported GAAP Net Income from Continuing Operations:

(in millions, except per share amounts)	Exelon Earnings per Diluted Share		Exelon		ComEd		PECO		BGE		PHI
2023 GAAP Net Income from Continuing Operations	$	0.34	$	343	$	249	$	97	$	42	$	103
Mark-to-Market Impact of Economic Hedging Activities (net of taxes of $1)		—		3		—		—		—		—
Change in Environmental Liabilities (net of taxes of $1)		0.01		11		—		—		—		11
SEC Matter Loss Contingency (net of taxes of $0)		0.05		46		—		—		—		—
Separation Costs (net of taxes of $2, $1, $0, $0, and $1, respectively)		0.01		5		2		1		1		1
2023 Adjusted (non-GAAP) Operating Earnings	$	0.41	$	408	$	251	$	98	$	43	$	115

Adjusted (non-GAAP) Operating Earnings for the second quarter of 2022 do not include the following items (after tax) that were included in reported GAAP Net Income from Continuing Operations:

(in millions, except per share amounts)	Exelon Earnings per Diluted Share			Exelon			ComEd		PECO		BGE		PHI
2022 GAAP Net Income from Continuing Operations	$	0.47		$	465		$	227	$	133	$	37	$	100
Separation Costs (net of taxes of $4, $1, $0, $0, and $1, respectively)		0.01			10			2		1		1		2
Income Tax-Related Adjustments (entire amount represents tax expense)		(0.04	)		(43	)		—		—		—		—
2022 Adjusted (non-GAAP) Operating Earnings	$	0.44		$	433		$	229	$	134	$	38	$	101

Note: Amounts may not sum due to rounding.

Unless otherwise noted, the income tax impact of each reconciling item between GAAP Net Income from Continuing Operations and Adjusted (non-GAAP) Operating Earnings is based on the marginal statutory federal and state income tax rates for each Registrant, taking into account whether the income or expense item is taxable or deductible, respectively, in whole or in part. For all items, the marginal statutory income tax rates for 2023 and 2022 ranged from 24.0% to 29.0%.

Webcast Information

Exelon will discuss second quarter 2023 earnings in a conference call scheduled for today at 9 a.m. Central Time (10 a.m. Eastern Time). The webcast and associated materials can be accessed at www.exeloncorp.com/investor-relations.

About Exelon

Exelon (NASDAQ:EXC) is a Fortune 250 company and the nation's largest utility company, serving more than 10 million customers through six fully regulated transmission and distribution utilities — Atlantic City Electric (ACE), Baltimore Gas and Electric (BGE), Commonwealth Edison (ComEd), Delmarva Power & Light (DPL), PECO Energy Company (PECO), and Potomac Electric Power Company (Pepco). More than 19,000 Exelon employees dedicate their time and expertise to supporting our communities through reliable, affordable and efficient energy delivery, workforce development, equity, economic development and volunteerism. Follow Exelon on Twitter @Exelon.

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 measure 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 measure 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. Exelon 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 Net Income 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 Aug. 2, 2023.

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. Words such as "could," "may," "expects," "anticipates," "will," "targets," "goals," "projects," "intends," "plans," "believes," "seeks," "estimates," "predicts," "should," and variations on such words, and similar expressions that reflect our current views with respect to future events and operational, economic, and financial performance, are intended to identify such forward-looking statements.

The factors that could cause actual results to differ materially from the forward-looking statements made by Exelon Corporation, Commonwealth Edison Company, PECO Energy Company, Baltimore Gas and Electric Company, Pepco Holdings LLC, 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) the Registrants' 2022 Annual Report on Form 10-K in (a) Part I, ITEM 1A. Risk Factors, (b) Part II, ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations, and (c) Part II, ITEM 8. Financial Statements and Supplementary Data: Note 18, Commitments and Contingencies; (2) the Registrants' Second Quarter 2023 Quarterly Report on Form 10-Q (to be filed on Aug. 2, 2023) in (a) Part II, ITEM 1A. Risk Factors, (b) Part I, ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations, and (c) Part I, ITEM 1. Financial Statements: Note 12, Commitments and Contingencies; and (3) other factors discussed in filings with the SEC by the Registrants.

Investors are cautioned not to place undue reliance on these forward-looking statements, whether written or oral, 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.

Earnings Release Attachments Table of Contents
Consolidating Statement of Operations	1

Consolidated Balance Sheets	3

Consolidated Statements of Cash Flows	5

Reconciliation of GAAP Net Income from Continuing Operations to Adjusted (non-GAAP) Operating Earnings and Analysis of Earnings	6

Statistics
ComEd	9
PECO	10
BGE	13
Pepco	16
DPL	17
ACE	19


Consolidating Statements of Operations (unaudited) (in millions)

	ComEd			PECO			BGE			PHI			Other (a)			Exelon
Three Months Ended June 30, 2023
Operating revenues	$	1,901		$	828		$	797		$	1,305		$	(13	)	$	4,818
Operating expenses
Purchased power and fuel		685			302			272			467			1			1,727
Operating and maintenance		355			239			198			304			101			1,197
Depreciation and amortization		350			99			158			243			16			866
Taxes other than income taxes		88			47			76			112			1			324
Total operating expenses		1,478			687			704			1,126			119			4,114
Operating income (loss)		423			141			93			179			(132	)		704
Other income and (deductions)
Interest expense, net		(120	)		(48	)		(44	)		(81	)		(134	)		(427	)
Other, net		17			6			5			25			86			139
Total other income and (deductions)		(103	)		(42	)		(39	)		(56	)		(48	)		(288	)
Income (loss) before income taxes		320			99			54			123			(180	)		416
Income taxes		71			2			12			20			(32	)		73
Net income (loss)		249			97			42			103			(148	)		343
Net income (loss) attributable to common shareholders	$	249		$	97		$	42		$	103		$	(148	)	$	343

Three Months Ended June 30, 2022
Operating revenues	$	1,425		$	816		$	786		$	1,221		$	(9	)	$	4,239
Operating expenses
Purchased power and fuel		283			283			289			420			(1	)		1,274
Operating and maintenance		338			215			205			292			59			1,109

Exelon Reports Second Quarter 2023 Results