Exelon Q3 profits fall on lower energy margins, raises FY EPS guidance



Exelon (NYSE:EXC) reported Thursday that its third-quarter earnings fell 51 per cent amid merger costs, lower energy margins and lower nuclear volume due to increased planned and unplanned outage days.

The largest operator of nuclear plants in the U.S. posted earnings of $296 million or 35 cents per share for the quarter ended September 30. That compares to earnings of $601 million or 90 cents per share a year earlier.

Adjusted for merger costs, market prices, maintenance expenses, and lower margins and volumes, the company posted earnings of $658 million or 77 cents per share. This compares to adjusted earnings of $743 million or $1.12 per share in the 2011 third quarter.

Revenue increased 25% to $6.57 billion.

Analysts polled by Thomson Reuters projected per share earnings of 72 cents on revenue of $7.99 billion.

“We delivered strong financial performance during the third quarter and exceeded our quarterly guidance range thanks in large part to the management of our portfolio by Constellation, Exelon’s retail and wholesale marketing organization,” said president and CEO Christopher M. Crane

“Based on our results through September and the Illinois Commerce Commission’s  reversal of its ComEd pension asset decision in October, we are revising our full-year operating earnings guidance range upwards to $2.75 to $2.95 per share.”

Exelon’s prior estimate for earnings was $2.55 to $2.85. The company said the updated outlook assumes normal weather for the rest of 2012 and preliminary cost estimates for impacts from Hurricane Sandy.

Exelon owns Illinois utility Commonwealth Edison as well, but its largest business is operating power plants across the U.S. and selling the electricity on the wholesale market. Earlier this year, the company acquired Constellation Energy Group Inc., owner of Baltimore Gas & Electric as well as a fleet of nuclear-power plants and a retail power business.

At the company's competitive generating operations, earnings fell 76 per cent, but, on an adjusted basis, were off only 12 per cent. The generation segment's average realized margin on all electric sales was down 34 per cent at $25.96 per megawatt-hour.

Within the company’s’ nuclear operations, its generation business saw its nuclear fleet, including its owned output from the Salem Generating Station, produce 34,581 gigawatt-hours (GWh) in the third quarter of 2012, compared with 36,045 GWh a year earlier. 

Exelon said the number of planned refueling outage days totaled 43, versus 33 days in the year-ago quarter.

The number of non-refueling outage days at the Exelon-operated plants totaled 40 days, compared with three days in the third quarter of 2011.

Within the company’s fossil and renewables operations, the forced outage rate for Generation’s fossil fleet is 3.7 per cent, compared with 6.0 per cent a year earlier. 

The equivalent availability factor for the hydroelectric facilities was 91.9 per cent in the third quarter, compared with 93.9 per cent a year ago. The company said the change was largely due to planned outages in July and August this year. 

The energy capture for the wind fleet was 94.4 per cent, compared with 91.6 per cent in the year-ago quarter.

Headquartered in Chicago, Exelon has operations and business activities in 47 states, the District of Columbia and Canada. 

Exelon is the largest competitive U.S. power generator, with approximately 35,000 megawatts of owned capacity. 

Shares dipped 3.07 per cent, trading at $34.70 as at about 12 p.m. EDT.


Quick facts: Exelon

Price: 40.415 USD

Market: NYSE
Market Cap: $39.35 billion

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