Exelon Corporation

Hello and welcome to Excellence Second Quarter Earnings Call. My name is Nora and I'll be your event specialist today. All lines have been placed on mute to prevent any background noise. Please note that today's webcast is being recorded. During the presentation, we'll have a question and answer session. You can ask questions by pressing star 1 on your telephone keypad. If you'd like to view the presentation in a full screen view, click the full screen button by hovering your computer mouse first or over the PowerPoint screen. Press the escape key on your keyboard to return to your original view. And finally, should you need technical assistance, as a best practice, we suggest you first refresh your browser. If that does not resolve the issue, please click on the help option in the upper right-hand corner of your screen for online troubleshooting. It is now my pleasure to turn today's program over to Dan Eggers, Senior Vice President of Corporate Finance. Sir, the floor is yours.

Thank you, Nora. Good morning, everyone, and thank you for joining our second quarter 2020 earnings conference call. Leading the call today are Chris Crane, Exelon's President and Chief Executive Officer, and Joe Nigro, Exelon's Chief Financial Officer. They are joined by other members of Exelon's senior management team who will be available to answer your questions following our prepared remarks. We issued our earnings release this morning along with the presentation, both of which can be found in the investor relations section of Exelon's website. The earnings released and other matters which we discussed during today's call contain forward-looking statements and estimates that are subject to various risks and uncertainties. Actual results could differ from our forward-looking statements based on factors and assumptions discussed in today's material and comments made during this call. Please refer to today's 8K and Exelon's other SEC filings for discussions of risk factors and other factors, including uncertainties surrounding the impacts of the COVID-19 pandemic that may cause results to differ from management's projections, forecasts, and expectations. Today's presentation also includes references to adjusted operating earnings and other non-GAAP measures. Please refer to the information contained in the appendix of our presentation and our earnings release for reconciliations between the non-GAAP measure's and the nearest equivalent GAAP measures. I'll now turn the call over to Chris Crane, Exelon CEO.

Thanks, Dan. And I appreciate everybody joining the call this morning and spending time with us. Starting off, as you've seen from our releases this morning, the GAAP basis, on a GAAP basis, we earn 53 cents per share. On a non-GAAP basis, we earn 55 cents per share. We had a great quarter outperforming our guidance range of 35 to 45 cents per share due to achieving cost savings earlier than planned. Joe will get into it. Our load assumptions came out how we expected, but we've had excellent operations, but also have confronted some serious challenges throughout the quarter. First, ComEd reached an agreement with the U.S. Attorney's Office in Illinois that includes a three-year deferred prosecution agreement in a payment of $200 million, which ends the investigations into ComEd and Exelon. We have taken robust actions to identify and address deficiencies including enhancing our compliance governance to prevent this type of conduct. We apologize for the past conduct that did not live up to our values. These new policies and oversight will ensure it won't happen again. We're extremely disappointed in the seriousness of the past misconduct, and we know many stakeholders understandably feel the same disappointment. We have, you have, our commitment that we will take every possible step to earn back the confidence and trust we have lost with others. This will not happen overnight, and it will be a formidable task, but we're resolved to get there. Second, our country is addressing equity, and social justice, and we are doing so as well. Our employees and communities, our customers are diverse, and we have a critical leadership role in pursuing equity and fairness for all those who are facing ingrained injustice and discrimination. That means living our values both within and outside the walls of our companies. Sponsoring job programs in underserved communities is a big focus of ours. Developing a larger base of diverse suppliers in our footprint. Supporting through philanthropic and volunteerism a wide variety of organizations. Pursuing equity and economic development. Making it clear what our values are through action. Our focus on our values of respect, diversity, and inclusion cannot waver, and we know black lives matter. All our diverse communities matter, and we're standing to protect them and help serve them. We've doubled down on our work to support our diverse and underserved customers and communities since we all are impacted by continued inequity, and we must do more. Switching to the COVID issue, COVID-19 continues to impact our communities. We remain focused on safety of our employees, running our operations at the best in class levels, and supporting our customers and communities. Incorporated pandemic-related policies into our management model that keep our employees and our contractors safe. are predicting on key milestones that will ensure employee safety and confidence that they can come back to the workplace. We've created contingency plans to monitor system configuration and allow us for rapid emergency response in storm or normal operations. In providing a deferred payment arrangement for the high rate of unemployment that we're dealing with in the communities that we serve. On the operational highlights, operations are strong with the pandemic conditions and extreme storms across the territory. In early June, Pico faced its eighth largest storm in history, which brought sustained winds of over 40 miles per hour and gusts of more than 60 miles per hour. 400 customers were out within an hour of the storm beginning, and we were able to restore 80% of those customers with widespread damage in 36 hours. We had already prepared and drilled new procedures for storm response during the pandemic. 80% of our back office storm roles are performed now remotely. Within 48 hours, 3,750 contractors and mutual assistance personnel were safely on site in the Pico region to restore customers. They were onboarded electronically, which we continued to do. and outage frequency. Nuclear had its best second quarter capacity factor in more than a decade at 95.4%. We safely competed in this quarter by repealing outages. There's been eight for the year, and most ahead of schedule while protecting our employees and the contractors. Power dispatch match. the renewable capture rate was 92.7%. So overall, very, very strong operational performance. We also continue to focus on our environmental stewardship. In July, we released our once again found Exelon has the lowest carbon emission rate of the top 20 investor-owned power producers, nearly five times less than the number two producer and the largest producer of carbon-free generation. In 2019, utility energy efficiency programs helped customers save 22.3 million megawatt hours and avoid 8.7 million metric tons 30% of the vehicle fleet by 2025, and 50% by 2030, avoiding more than 65,000 metric tons of carbon from 2020 to 2030. We're committed to deliver affordable, zero-emissions power in helping our customers and our community reduce the harmful emissions that exist in their communities. economy, but they are not enough to address the climate crisis. We continue to advocate for policies at the state and federal levels that will address the challenges. Now I'm going to turn the call over to Joe for the financial update.