Exhibit 99.1
News Release
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| Contact: | | Emily Duncan Investor Relations 833-447-2783 investorrelations@constellation.com
Paul Adams Corporate Communications 667-218-7700 paul.adams@constellation.com
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CONSTELLATION REPORTS FOURTH QUARTER AND FULL YEAR 2023 RESULTS
Earnings Release Highlights
•GAAP Net Loss of ($36) million and Adjusted EBITDA (non-GAAP) of $1,137 million for the fourth quarter of 2023. GAAP Net Income of $1,623 million and Adjusted EBITDA (non-GAAP) of $4,025 million for the full year 2023, exceeding the top end of our guidance range of $3,800 million to $4,000 million
•Delivered on our commitments to shareholders:
◦Expanded the nation's largest, highly reliable, carbon-free nuclear fleet by acquiring a partial ownership stake in the South Texas Project Nuclear Generating Station
◦Completed our initial $1 billion of share repurchases and authorized an additional $1 billion in continuation of the program, reinforcing our commitment to return value to shareholders
◦Our issuer credit rating was upgraded by Standard & Poor’s (S&P) for the second time since separation, from BBB to BBB+, reflecting our improving financial measures and risk profile
◦Doubled the annual per share dividend from the 2022 level
◦Commenced our $350 million project to expand our renewable energy portfolio by completing the repowering of Criterion and beginning the repowering of our Missouri wind generation facilities
•Recognized by Just Capital in its "Just 100" annual ranking that reflects the performance of America’s largest publicly traded companies based on a variety of key factors
•Ranked the No. 1 producer of carbon-free energy and have the lowest rate of carbon dioxide emissions for the 10th consecutive year amongst our peer group
•Received the Community Partnership Award from The Center for Energy Workforce Development for our work in building a skilled energy workforce that represents the diverse communities we serve
•Earned 2023 Great Place to Work® certification based on positive ratings from our employees on their experience working at Constellation
Baltimore (Feb. 27, 2024) — Constellation Energy Corporation (Nasdaq: CEG) today reported its financial results for the fourth quarter and full year 2023.
“We had extremely strong financial and operational performance as our nuclear fleet continued to achieve unmatched reliability, allowing us to deliver carbon-free energy to our customers in all hours of the day under some of the harshest weather conditions in decades,” said Joe Dominguez, president and CEO of Constellation. “Our generation fleet was matched by an industry-leading commercial business serving the most competitive large industrial customers and three-fourths of the Fortune 100 last year, including top names in technology and other industries seeking to drive economic growth with clean energy across our nation. We took a disciplined approach to growing our business in 2023, completing our acquisition of a partial stake in the South Texas Project nuclear plant, repowering our wind assets, taking steps to extend the life of our nuclear plants and investing in new equipment to increase their output. We are delivering our hourly-matched carbon-free energy product to top sustainability leaders, and our results reflect growing acknowledgement by our customers that nuclear energy delivers unique value that can’t be matched anywhere in the marketplace.”
“Our high investment grade balance sheet and the competitive advantage of our integrated generation and commercial business delivered exceptional financial performance in 2023, earning $4.025 billion in adjusted EBITDA, up from $2.667 billion in the previous year and over $900 million above the midpoint of our original guidance,” said Dan Eggers, chief financial officer of Constellation. “We continue to invest in organic and inorganic growth opportunities, while doubling our dividend, completing our $1 billion share repurchase program and authorizing a second $1 billion repurchase program in December.”
Investor and Analyst Webcast Information
We will host a virtual investor and analyst event via webcast to highlight Constellation’s business and earnings outlook for 2024 and beyond, scheduled for tomorrow at 8:30 a.m. Eastern Time. The webcast and associated materials can be accessed at https://investors.constellationenergy.com.
Fourth Quarter 2023
Our GAAP Net Loss for the fourth quarter of 2023 was ($36) million, down from $34 million GAAP Net Income in the fourth quarter of 2022. Adjusted EBITDA (non-GAAP) for the fourth quarter of 2023 increased to $1,137 million from $605 million in the fourth quarter of 2022. For the reconciliations of GAAP Net Income (Loss) to Adjusted EBITDA (non-GAAP), refer to the tables beginning on page 4.
Adjusted EBITDA (non-GAAP) in the fourth quarter of 2023 primarily reflects:
•Favorable market and portfolio conditions partially offset by unfavorable labor, contracting, and materials, decreased ZEC revenues, decreased capacity revenues, and unfavorable impacts of nuclear outages
Full Year 2023
Our GAAP Net Income for 2023 was $1,623 million, compared to ($160) million GAAP Net Loss in 2022. Adjusted EBITDA (non-GAAP) for 2023 increased to $4,025 million from $2,667 million in 2022.
Adjusted EBITDA (non-GAAP) for the full year 2023 primarily reflects:
•Favorable market and portfolio conditions partially offset by unfavorable labor, contracting, and materials, decreased capacity revenues, and unfavorable impacts of nuclear outages
Recent Developments and 2023 Highlights
•Delivering on Our Capital Allocation Promises: Through our strong free cash flows we delivered on our commitments announced last year to grow the business and return capital to shareholders. We grew our nuclear fleet with our acquisition of an undivided ownership interest in the South Texas Project Nuclear Generating Station, a 2,645-megawatt, dual-unit nuclear plant located about 90 miles southwest of Houston, for $1.65 billion, further expanding our contribution to a carbon-free future. We completed our initial $1 billion of share repurchases, buying back nearly 10.6 million shares. In December our Board of Directors approved expanding the program for an additional $1 billion, reinforcing our continued commitment to return value to shareholders. We received our second issuer credit rating upgrade from S&P since separation, from BBB to BBB+, reflecting their view that the financial risk has significantly improved with the nuclear production tax credit (PTC). We doubled our dividend from the 2022 level. During the year we also commenced our previously announced $350 million effort to increase the output and lifespan of our renewable energy portfolio, beginning with the repowering of our Criterion and Missouri wind facilities.
•No. 1 Producer of Carbon-Free Energy: For the 10th consecutive year we are the nation’s largest producer of carbon-free energy and have the lowest rate of carbon dioxide emissions among the 20 largest private, investor-owned power producers in the United States, according to an independent analysis based on publicly reported 2021 air emissions data. The annual Benchmarking Air Emissions of the 100 Largest Electric Power Producers in the United States report showed that the next cleanest company among the group of 20 had more than four-and-a-half times the rate of carbon dioxide emissions as Constellation.
•Just Capital "Just 100": Just Capital recognized Constellation in its “Just 100,” an annual ranking that reflects the performance of America’s largest publicly traded companies based on a variety of issues deemed by Americans to be most important in business today. Key factors for selection range from how a company invests in its employees and communities, to how it treats customers and minimizes environmental impact.
•Community Partnership Award: We received the Community Partnership Award from The Center for Energy Workforce Development (CEWD) for our work in building a skilled energy workforce that represents the diverse communities we serve. The award recognizes our multi-faceted efforts to establish lasting and impactful relationships with our local community — including educators, minority facing organizations, workforce development nonprofits and others — to fuel the energy talent pipeline. We also teamed up with CEWD to sponsor its Energy Industry Fundamentals 2.0 program. The interactive, 120-hour curriculum for high school and technical school students aims to provide expanded energy education and career awareness to 500,000 students over the next decade.
•2023 Great Place to Work Certification: In the third quarter we were Certified™ by Great Place To Work®. The designation is based on how our employees rate their experience working at Constellation. In a survey of about 5,000 of our employees, 81% of those who responded said it is a great place to work – about 24 points higher than the average U.S. company. Great Place To Work® is acknowledged worldwide as a global benchmark for workplace culture, employee experience and the leadership behaviors proven to deliver strong market performance, employee retention and increased innovation.
•Nuclear Operations: Our nuclear fleet, including our owned output from the Salem and South Texas Project (STP) Generating Stations, produced 45,563 gigawatt-hours (GWhs) in the fourth quarter of 2023, compared with 44,436 GWhs in the fourth quarter of 2022. Excluding Salem and STP, our nuclear plants at ownership achieved a 95.1% capacity factor for the fourth quarter of 2023, compared with 95.4% for the fourth quarter of 2022. There were 56 planned refueling outage days in the fourth quarter of 2023 and 65 in the fourth quarter of 2022. There were seven non-refueling outage days in the fourth quarter of 2023 and three in the fourth quarter of 2022.
•Natural Gas, Oil, and Renewables Operations: The dispatch match rate for our gas and hydro fleet was 97.5% in the fourth quarter of 2023, compared with 96.1%1 in the fourth quarter of 2022. Energy capture for the wind and solar fleet was 96.3% in the fourth quarter of 2023, compared with 96.7%1 in the fourth quarter of 2022.
GAAP/Adjusted EBITDA (non-GAAP) Reconciliation
Adjusted EBITDA (non-GAAP) for the three and twelve months ended December 31, 2023 and 2022 does not include the following items that were included in our reported GAAP Net Income:
| | | | | | | | | | | | | | | | | | | | | | | |
| Three Months Ended December 31, | | Twelve Months Ended December 31, |
| (in millions) | 2023 | | 2022 | | 2023 | | 2022 |
| GAAP Net Income (Loss) Attributable to Common Shareholders | $ | (36) | | | $ | 34 | | | $ | 1,623 | | | $ | (160) | |
| Income Tax (Benefit) Expense | 158 | | | 133 | | | 840 | | | (339) | |
| Depreciation and Amortization | 288 | | | 272 | | | 1,096 | | | 1,091 | |
| Interest Expense, Net | 139 | | | 64 | | | 431 | | | 251 | |
| Unrealized Loss (Gain) on Fair Value Adjustments | 1,002 | | | 413 | | | 658 | | | 1,058 | |
| Asset Impairments | — | | | — | | | 71 | | | — | |
| Plant Retirements and Divestitures | — | | | (7) | | | (28) | | | (11) | |
| Decommissioning-Related Activities | (439) | | | (306) | | | (716) | | | 820 | |
| Pension & OPEB Non-Service Credits | (14) | | | (31) | | | (54) | | | (116) | |
| Separation Costs | 17 | | | 41 | | | 101 | | | 140 | |
| Acquisition Related Costs | 9 | | | — | | | 12 | | | — | |
| ERP System Implementation Costs | 5 | | | 6 | | | 25 | | | 22 | |
| Change in Environmental Liabilities | 15 | | | (2) | | | 43 | | | 10 | |
| Prior Merger Commitment | — | | | — | | | — | | | (50) | |
| Noncontrolling Interests | (7) | | | (12) | | | (77) | | | (49) | |
| Adjusted EBITDA (non-GAAP) | $ | 1,137 | | | $ | 605 | | | $ | 4,025 | | | $ | 2,667 | |
________
1Prior year dispatch match and energy capture was previously reported as 96.6% and 95.9%, respectively. The update reflects a change to include the Conowingo run-of-river hydroelectric operational performance within renewable energy capture, and remove the performance from dispatch match.
About Constellation
A Fortune 200 company headquartered in Baltimore, Constellation Energy Corporation (Nasdaq: CEG) is the nation’s largest producer of clean, carbon-free energy and a leading supplier of energy products and services to businesses, homes, community aggregations and public sector customers across the continental United States, including three fourths of Fortune 100 companies. With annual output that is nearly 90% carbon-free, our hydro, wind and solar facilities paired with the nation’s largest nuclear fleet have the generating capacity to power the equivalent of 16 million homes, providing about 10% of the nation’s clean energy. We are further accelerating the nation’s transition to a carbon-free future by helping our customers reach their sustainability goals, setting our own ambitious goal of achieving 100% carbon-free generation by 2040, and by investing in promising emerging technologies to eliminate carbon emissions across all sectors of the economy.
Non-GAAP Financial Measures
In analyzing and planning for our business, we supplement our use of net income as determined under generally accepted accounting principles in the United States (GAAP), with Adjusted EBITDA (non-GAAP) as a performance measure. Adjusted EBITDA (non-GAAP) reflects an additional way of viewing our business that, when viewed with our GAAP results and the accompanying reconciliation to GAAP net income included above, may provide a more complete understanding of factors and trends affecting our business. Adjusted EBITDA (non-GAAP) should not be relied upon to the exclusion of GAAP financial measures and is, by definition, an incomplete understanding of our business, and must be considered in conjunction with GAAP measures. In addition, Adjusted EBITDA (non-GAAP) is neither a standardized financial measure, nor a presentation defined under GAAP and may not be comparable to other companies’ presentations or deemed more useful than the GAAP information provided elsewhere in this press release and earnings release attachments. We have 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 EBITDA (non-GAAP) should not be deemed more useful than, a substitute for, or an alternative to the most comparable GAAP Net Income measure provided in this earnings release and attachments. This press release and earnings release attachments provide reconciliations of Adjusted EBITDA (non-GAAP) to the most directly comparable financial measures calculated and presented in accordance with GAAP and are posted on our website: www.ConstellationEnergy.com, and have been furnished to the Securities and Exchange Commission on Form 8-K on February 27, 2024.
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,” 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 Constellation Energy Corporation and Constellation Energy Generation, LLC, (Registrants) include those factors discussed herein, as well as the items discussed in (1) the Registrants' 2023 Annual Report on Form 10-K (to be filed on February 27, 2024) 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 19, Commitments and Contingencies, and (2) 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. Neither 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
Constellation Energy Corporation and Subsidiary Companies
Consolidated Statements of Operations
(unaudited)
(in millions)
| | | | | | | | | | | | | | | | |
| | | | | | |
| | | | Three Months Ended December 31, 2023 | | Twelve Months Ended December 31, 2023 |
| Operating revenues | | | | $ | 5,796 | | | $ | 24,918 | |
| Operating expenses | | | | | | |
| Purchased power and fuel | | | | 4,018 | | | 16,001 | |
| Operating and maintenance | | | | 1,422 | | | 5,685 | |
| Depreciation and amortization | | | | 288 | | | 1,096 | |
| Taxes other than income taxes | | | | 134 | | | 553 | |
| Total operating expenses | | | | 5,862 | | | 23,335 | |
| Gain (loss) on sales of assets and businesses | | | | (1) | | | 27 | |
| | | | | | |
| | | | | | |
| Operating income (loss) | | | | (67) | | | 1,610 | |
| Other income and (deductions) | | | | | | |
| Interest expense, net | | | | (139) | | | (431) | |
| Other, net | | | | 349 | | | 1,268 | |
| Total other income and (deductions) | | | | 210 | | | 837 | |
| Income (loss) before income taxes | | | | 143 | | | 2,447 | |
| Income tax (benefit) expense | | | | 182 | | | 859 | |
| Equity in losses of unconsolidated affiliates | | | | — | | | (11) | |
| Net income (loss) | | | | (39) | | | 1,577 | |
| Net income (loss) attributable to noncontrolling interests | | | | (3) | | | (46) | |
| Net income (loss) attributable to common shareholders | | | | $ | (36) | | | $ | 1,623 | |
| | | | | | |
| | | | | | |
| | | | Three Months Ended December 31, 2022 | | Twelve Months Ended December 31, 2022 |
| Operating revenues | | | | $ | 7,333 | | | $ | 24,440 | |
| Operating expenses | | | | | | |
| Purchased power and fuel | | | | 5,708 | | | 17,462 | |
| Operating and maintenance | | | | 1,375 | | | 4,841 | |
| Depreciation and amortization | | | | 272 | | | 1,091 | |
| Taxes other than income taxes | | | | 138 | | | 552 | |
| Total operating expenses | | | | 7,493 | | | 23,946 | |
| Gain (loss) on sales of assets and businesses | | | | (12) | | | 1 | |
| | | | | | |
| | | | | | |
| Operating income (loss) | | | | (172) | | | 495 | |
| Other income and (deductions) | | | | | | |
| Interest expense, net | | | | (64) | | | (251) | |
| Other, net | | | | 383 | | | (786) | |
| Total other income and (deductions) | | | | 319 | | | (1,037) | |
| Income (loss) before income taxes | | | | 147 | | | (542) | |
| Income tax (benefit) expense | | | | 116 | | | (388) | |
| Equity in losses of unconsolidated affiliates | | | | (4) | | | (13) | |
| Net income (loss) | | | | 27 | | | (167) | |
| Net income (loss) attributable to noncontrolling interests | | | | (7) | | | (7) | |
| Net income (loss) attributable to common shareholders | | | | $ | 34 | | | $ | (160) | |
| | | | | | |
| Change in Net income (loss) from 2022 to 2023 | | | | $ | (70) | | | $ | 1,783 | |
Constellation Energy Corporation and Subsidiary Companies
Consolidated Balance Sheets
(unaudited)
(in millions)
| | | | | | | | | | | | | | |
| | December 31, 2023 | | December 31, 2022 |
| Assets | | | | |
| Current assets | | | | |
| Cash and cash equivalents | | $ | 368 | | | $ | 422 | |
| Restricted cash and cash equivalents | | 86 | | | 106 | |
| Accounts receivable | | | | |
| Customer accounts receivable (net of allowance for credit losses of $56 and $46 as of December 31, 2023 and 2022, respectively) | | 1,934 | | | 2,585 | |
| Other accounts receivable (net of allowance for credit losses of $5 as of December 31, 2023 and 2022) | | 917 | | | 731 | |
| Mark-to-market derivative assets | | 1,179 | | | 2,368 | |
| | | | |
| Inventories, net | | | | |
| Natural gas, oil, and emission allowances | | 284 | | | 429 | |
| Materials and supplies | | 1,216 | | | 1,076 | |
| | | | |
| | | | |
| Renewable energy credits | | 660 | | | 617 | |
| | | | |
| Other | | 1,655 | | | 1,026 | |
| Total current assets | | 8,299 | | | 9,360 | |
| Property, plant, and equipment, net | | 22,116 | | | 19,822 | |
| Deferred debits and other assets | | | | |
| | | | |
| Nuclear decommissioning trust funds | | 16,398 | | | 14,114 | |
| Investments | | 563 | | | 202 | |
| Goodwill | | 425 | | | 47 | |
| Mark-to-market derivative assets | | 995 | | | 1,261 | |
| | | | |
| | | | |
| Deferred income taxes | | 52 | | | 44 | |
| Other | | 1,910 | | | 2,059 | |
| Total deferred debits and other assets | | 20,343 | | | 17,727 | |
| Total assets | | $ | 50,758 | | | $ | 46,909 | |
| | | | | | | | | | | | | | |
| | December 31, 2023 | | December 31, 2022 |
| Liabilities and shareholders’ equity | | | | |
| Current liabilities | | | | |
| Short-term borrowings | | $ | 1,644 | | | $ | 1,159 | |
| Long-term debt due within one year | | 121 | | | 143 | |
| | | | |
| Accounts payable and accrued expenses | | 2,612 | | | 3,734 | |
| | | | |
| | | | |
| | | | |
| | | | |
| Mark-to-market derivative liabilities | | 632 | | | 1,558 | |
| | | | |
| Renewable energy credit obligation | | 972 | | | 901 | |
| | | | |
| Other | | 338 | | | 344 | |
| Total current liabilities | | 6,319 | | | 7,839 | |
| Long-term debt | | 7,496 | | | 4,466 | |
| | | | |
| | | | |
| Deferred credits and other liabilities | | | | |
| Deferred income taxes and unamortized ITCs | | 3,209 | | | 3,031 | |
| Asset retirement obligations | | 14,118 | | | 12,699 | |
| Pension obligations | | 1,070 | | | 605 | |
| Non-pension postretirement benefit obligations | | 732 | | | 609 | |
| Spent nuclear fuel obligation | | 1,296 | | | 1,230 | |
| | | | |
| | | | |
| Payables related to Regulatory Agreement Units | | 3,688 | | | 2,897 | |
| Mark-to-market derivative liabilities | | 419 | | | 983 | |
| Other | | 1,125 | | | 1,178 | |
| Total deferred credits and other liabilities | | 25,657 | | | 23,232 | |
| Total liabilities | | 39,472 | | | 35,537 | |
| Commitments and contingencies | | | | |
| | | | |
| Shareholders' equity | | | | |
| | | | |
| Common stock | | 12,355 | | | 13,274 | |
| Retained earnings (deficit) | | 761 | | | (496) | |
| Accumulated other comprehensive income (loss), net | | (2,191) | | | (1,760) | |
| Total shareholders’ equity | | 10,925 | | | 11,018 | |
| Noncontrolling interests | | 361 | | | 354 | |
| Total equity | | 11,286 | | | 11,372 | |
| Total liabilities and shareholders’ equity | | $ | 50,758 | | | $ | 46,909 | |
Constellation Energy Corporation and Subsidiary Companies
Consolidated Statements of Cash Flows
(unaudited)
(in millions)
| | | | | | | | | | | | | | |
| | Twelve Months Ended December 31, |
| | | 2023 | | 2022 |
| Cash flows from operating activities | | | | |
| Net income (loss) | | $ | 1,577 | | | $ | (167) | |
| Adjustments to reconcile net income (loss) to net cash flows provided by (used in) operating activities | | | | |
| Depreciation, amortization, and accretion, including nuclear fuel and energy contract amortization | | 2,514 | | | 2,427 | |
| | | | |
| | | | |
| | | | |
| | | | |
| Deferred income taxes and amortization of ITC | | 251 | | | (643) | |
| Net fair value changes related to derivatives | | 996 | | | 986 | |
| Net realized and unrealized (gains) losses on NDT funds | | (476) | | | 794 | |
| Net realized and unrealized (gains) losses on equity investments | | (307) | | | 13 | |
| Other non-cash operating activities | | 18 | | | 248 | |
| Changes in assets and liabilities: | | | | |
| Accounts receivable | | 396 | | | (868) | |
| Receivables from and payables to affiliates, net | | — | | | 20 | |
| Inventories | | 60 | | | (228) | |
| Accounts payable and accrued expenses | | (1,330) | | | 1,142 | |
| Option premiums received (paid), net | | 26 | | | (177) | |
| Collateral received (posted), net | | (1,491) | | | (351) | |
| Income taxes | | 325 | | | 162 | |
| Pension and non-pension postretirement benefit contributions | | (54) | | | (237) | |
| Other assets and liabilities | | (7,806) | | | (5,474) | |
| Net cash flows provided by (used in) operating activities | | (5,301) | | | (2,353) | |
| Cash flows from investing activities | | | | |
| Capital expenditures | | (2,422) | | | (1,689) | |
| Proceeds from NDT fund sales | | 5,822 | | | 4,050 | |
| Investment in NDT funds | | (6,050) | | | (4,271) | |
| Collection of DPP, net | | 7,340 | | | 4,964 | |
| | | | |
| Proceeds from sales of assets and businesses | | 24 | | | 52 | |
| Acquisitions of assets and businesses | | (1,690) | | | (29) | |
| | | | |
| | | | |
| | | | |
| Other investing activities | | 7 | | | 27 | |
| Net cash flows provided by (used in) investing activities | | 3,031 | | | 3,104 | |
| Cash flows from financing activities | | | | |
| Change in short-term borrowings | | 146 | | | 257 | |
| Proceeds from short-term borrowings with maturities greater than 90 days | | 539 | | | — | |
| Repayments of short-term borrowings with maturities greater than 90 days | | (200) | | | (1,180) | |
| Issuance of long-term debt | | 3,195 | | | 14 | |
| Retirement of long-term debt | | (168) | | | (1,162) | |
| | | | |
| Retirement of long-term debt to affiliate | | — | | | (258) | |
| | | | |
| | | | |
| | | | |
| Contributions from Exelon | | — | | | 1,750 | |
| Dividends paid on common stock | | (366) | | | (185) | |
| | | | |
| | | | |
| | | | |
| | | | |
| Repurchases of common stock | | (992) | | | — | |
| Other financing activities | | 42 | | | (35) | |
| Net cash flows provided by (used in) financing activities | | 2,196 | | | (799) | |
| Increase (decrease) in cash, restricted cash, and cash equivalents | | (74) | | | (48) | |
| Cash, restricted cash, and cash equivalents at beginning of period | | 528 | | | 576 | |
| Cash, restricted cash, and cash equivalents at end of period | | $ | 454 | | | $ | 528 | |
Constellation Energy Corporation
Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA (non-GAAP) and Analysis of Earnings
Three Months Ended December 31, 2023 and 2022
(unaudited)
(in millions)
| | | | | | | | |
| | |
| 2022 GAAP Net Income (Loss) Attributable to Common Shareholders | | $ | 34 | |
| Income Tax (Benefit) Expense (1) | | 133 | |
| Depreciation and Amortization | | 272 | |
| Interest Expense, Net | | 64 | |
| Unrealized Loss (Gain) on Fair Value Adjustments (2) | | 413 | |
| | |
| Plant Retirements and Divestitures | | (7) | |
| Decommissioning-Related Activities (3) | | (306) | |
| Pension & OPEB Non-Service Credits | | (31) | |
| Separation Costs (4) | | 41 | |
| | |
| | |
| ERP System Implementation Costs (5) | | 6 | |
| Change in Environmental Liabilities | | (2) | |
| | |
| Noncontrolling Interests (6) | | (12) | |
| 2022 Adjusted EBITDA (non-GAAP) | | $ | 605 | |
| | |
| Year Over Year Effects on Adjusted EBITDA (non-GAAP): |
| | |
| | |
| Market and Portfolio Conditions (7) | | 775 | |
| ZEC Revenue (8) | | (79) | |
| PJM Performance Bonuses, Net (9) | | (55) | |
| Labor, Contracting and Materials (10) | | (39) | |
| Capacity Revenue (11) | | (43) | |
| Nuclear Outages (12) | | (40) | |
| | |
| | |
| | |
| | |
| | |
| | |
| Other | | 13 | |
| | |
| | |
| Total Year Over Year Effects on Adjusted EBITDA (non-GAAP) | | $ | 532 | |
| | |
| 2023 GAAP Net Income (Loss) Attributable to Common Shareholders | | $ | (36) | |
| Income Tax (Benefit) Expense (1) | | 158 | |
| Depreciation and Amortization | | 288 | |
| Interest Expense, Net | | 139 | |
| Unrealized Loss (Gain) on Fair Value Adjustments (2) | | 1,002 | |
| | |
| | |
| Decommissioning-Related Activities (3) | | (439) | |
| Pension & OPEB Non-Service Credits | | (14) | |
| Separation Costs (4) | | 17 | |
| | |
| Acquisition Related Costs | | 9 | |
| ERP System Implementation Costs (5) | | 5 | |
| Change in Environmental Liabilities | | 15 | |
| | |
| | |
| Noncontrolling Interests (6) | | (7) | |
| 2023 Adjusted EBITDA (non-GAAP) | | $ | 1,137 | |
(1)Includes amounts contractually owed to Exelon under the Tax Matters Agreement (TMA) reflected in Other, net.
(2)Includes mark-to-market on economic hedges and fair value adjustments related to gas imbalances and equity investments.
(3)Reflects all gains and losses associated with Nuclear Decommissioning Trusts (NDT), Asset Retirement Obligation (ARO) accretion, ARO remeasurement, and impacts of contractual offset for Regulatory Agreement Units.
(4)Represents certain incremental costs related to the separation (system-related costs, third-party costs paid to advisors, consultants, lawyers, and other experts assisting in the separation), including a portion of the amounts billed to us pursuant to the Transition Services Agreement (TSA).
(5)Reflects costs related to a multi-year Enterprise Resource Program (ERP) system implementation.
(6)Represents elimination of the noncontrolling interest related to certain adjustments.
(7)Favorable market and portfolio conditions primarily driven by higher realized margins on load contracts and generation-to-load optimization.
(8)Lower ZEC revenues primarily driven by lower Illinois ZEC prices in the current planning year.
(9)Reflects lower net bonus payments from PJM related to the December 2022 weather event in 2023 financial results compared to 2022, due to higher net revenue recorded in 2022, net of collectability reserves, compared to incremental net revenue in 2023 reflective of the final FERC-approved settlement.
(10)Primarily reflects increased employee-related costs, including labor and other incentives.
(11)Reflects decreased capacity revenues primarily in the Mid-Atlantic.
(12)Reflects volume and operating and maintenance impact of nuclear outages.
Constellation Energy Corporation
Reconciliation of GAAP Net Income (Loss) to Adjusted EBITDA (non-GAAP) and Analysis of Earnings
Twelve Months Ended December 31, 2023 and 2022
(unaudited)
(in millions)
| | | | | | | | |
| | |
| 2022 GAAP Net Income (Loss) Attributable to Common Shareholders | | $ | (160) | |
| Income Tax (Benefit) Expense (1) | | (339) | |
| Depreciation and Amortization | | 1,091 | |
| Interest Expense, Net | | 251 | |
| Unrealized Loss (Gain) on Fair Value Adjustments (2) | | 1,058 | |
| | |
| Plant Retirements and Divestitures | | (11) | |
| Decommissioning-Related Activities (3) | | 820 | |
| Pension & OPEB Non-Service Credits | | (116) | |
| Separation Costs (4) | | 140 | |
| | |
| | |
| ERP System Implementation Costs (5) | | 22 | |
| Change in Environmental Liabilities | | 10 | |
| Prior Merger Commitment (6) | | (50) | |
| Noncontrolling Interests (7) | | (49) | |
| 2022 Adjusted EBITDA (non-GAAP) | | $ | 2,667 | |
| | |
| Year Over Year Effects on Adjusted EBITDA (non-GAAP): |
| | |
| | |
| | |
| Market and Portfolio Conditions (8) | | 2,123 | |
| | |
| | |
| | |
| | |
| Labor, Contracting and Materials (9) | | (349) | |
| Capacity Revenue (10) | | (247) | |
| | |
| | |
| | |
| Nuclear Outages (11) | | (157) | |
| Other | | (12) | |
| | |
| | |
| Total Year Over Year Effects on Adjusted EBITDA (non-GAAP) | | $ | 1,358 | |
| | |
| 2023 GAAP Net Income (Loss) Attributable to Common Shareholders | | $ | 1,623 | |
| Income Tax (Benefit) Expense (1) | | 840 | |
| Depreciation and Amortization | | 1,096 | |
| Interest Expense, Net | | 431 | |
| Unrealized Loss (Gain) on Fair Value Adjustments (2) | | 658 | |
| Asset Impairments | | 71 | |
| Plant Retirements and Divestitures | | (28) | |
| Decommissioning-Related Activities (3) | | (716) | |
| Pension & OPEB Non-Service Credits | | (54) | |
| Separation Costs (4) | | 101 | |
| | |
| Acquisition Related Costs | | 12 | |
| ERP System Implementation Costs (5) | | 25 | |
| Change in Environmental Liabilities | | 43 | |
| | |
| | |
| Noncontrolling Interests (7) | | (77) | |
| 2023 Adjusted EBITDA (non-GAAP) | | $ | 4,025 | |
(1)Includes amounts contractually owed to Exelon under the TMA reflected in Other, net.
(2)Includes mark-to-market on economic hedges and fair value adjustments related to gas imbalances and equity investments.
(3)Reflects all gains and losses associated with NDTs, ARO accretion, ARO remeasurement, and impacts of contractual offset for Regulatory Agreement Units.
(4)Represents certain incremental costs related to the separation (system-related costs, third-party costs paid to advisors, consultants, lawyers, and other experts assisting in the separation), including a portion of the amounts billed to us pursuant to the TSA.
(5)Reflects costs related to a multi-year ERP system implementation.
(6)Reversal of a charge related to a 2012 merger commitment.
(7)Represents elimination of the noncontrolling interest related to certain adjustments.
(8)Favorable market and portfolio conditions primarily driven by higher realized margins on load contracts and generation-to-load optimization.
(9)Primarily reflects increased employee-related costs, including labor and other incentives, and certain non-essential maintenance work.
(10)Reflects decreased capacity revenues primarily in the Mid-Atlantic and Midwest.
(11)Reflects volume and operating and maintenance impact of nuclear outages, including Salem.
Constellation Energy Corporation
GAAP Consolidated Statements of Operations and
Adjusted EBITDA (non-GAAP) Reconciling Adjustments
(unaudited)
(in millions, except per share data)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended December 31, 2023 | | | | Three Months Ended December 31, 2022 | | |
| GAAP (a) | | Non-GAAP Adjustments | | | | | | GAAP (a) | | Non-GAAP Adjustments | | | | |
| Operating revenues | $ | 5,796 | | | $ | (84) | | | (b),(c) | | | | $ | 7,333 | | | $ | (713) | | | (b),(c) | | |
| Operating expenses | | | | | | | | | | | | | | | |
| Purchased power and fuel | 4,018 | | | (898) | | | (b) | | | | 5,708 | | | (1,125) | | | (b) | | |
| Operating and maintenance | 1,422 | | | (83) | | | (c),(d),(f),(l),(n) | | | | 1,375 | | | (86) | | | (c),(d),(f),(g),(l) | | |
| Depreciation and amortization | 288 | | | (288) | | | (h) | | | | 272 | | | (272) | | | (h) | | |
| Taxes other than income taxes | 134 | | | — | | | | | | | 138 | | | — | | | | | |
| Total operating expenses | 5,862 | | | | | | | | | 7,493 | | | | | | | |
| Gain (loss) on sales of assets and businesses | (1) | | | — | | | | | | | (12) | | | — | | | | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| Operating income (loss) | (67) | | | | | | | | | (172) | | | | | | | |
| Other income and (deductions) | | | | | | | | | | | | | | | |
| Interest expense, net | (139) | | | 139 | | | (i) | | | | (64) | | | 64 | | | (i) | | |
| Other, net | 349 | | | (326) | | | (b),(c),(e),(m) | | | | 383 | | | (367) | | | (b),(c),(d),(e),(f),(g),(j),(m) | | |
| Total other income and (deductions) | 210 | | | | | | | | | 319 | | | | | | | |
| Income (loss) before income taxes | 143 | | | | | | | | | 147 | | | | | | | |
| Income tax (benefit) expense | 182 | | | (182) | | | (j) | | | | 116 | | | (116) | | | (j) | | |
| Equity in income (losses) of unconsolidated affiliates | — | | | — | | | | | | | (4) | | | — | | | | | |
| Net income (loss) | (39) | | | | | | | | | 27 | | | | | | | |
| Net income (loss) attributable to noncontrolling interests | (3) | | | 7 | | | (k) | | | | (7) | | | 12 | | | (k) | | |
| Net income (loss) attributable to common shareholders | $ | (36) | | | | | | | | | $ | 34 | | | | | | | |
| Effective tax rate | 127.3 | % | | | | | | | | 78.9 | % | | | | | | |
| Earnings per average common share | | | | | | | | | | | | | | | |
| Basic | $ | (0.11) | | | | | | | | | $ | 0.10 | | | | | | | |
| Diluted | $ | (0.11) | | | | | | | | | $ | 0.10 | | | | | | | |
| Average common shares outstanding | | | | | | | | | | | | | | | |
| Basic | 320 | | | | | | | | | 328 | | | | | | | |
| Diluted | 321 | | | | | | | | | 329 | | | | | | | |
__________
(a)Results reported in accordance with GAAP.
(b)Adjustment for mark-to-market on economic hedges and fair value adjustments related to gas imbalances and equity investments.
(c)Adjustment for all gains and losses associated with NDTs, ARO accretion, ARO remeasurement, and any earnings neutral impacts of contractual offset for Regulatory Agreement Units.
(d)Adjustment for certain incremental costs related to the separation (system-related costs, third-party costs paid to advisors, consultants, lawyers, and other experts assisting in the separation), including a portion of the amounts billed to us pursuant to the TSA.
(e)Adjustment for Pension and Other Postretirement Employee Benefits (OPEB) Non-Service credits.
(f)Adjustment for costs related to a multi-year ERP system implementation.
(g)Adjustments related to plant retirements and divestitures.
(h)Adjustment for depreciation and amortization expense.
(i)Adjustment for interest expense.
(j)Adjustment for income taxes.
(k)Adjustment for elimination of the noncontrolling interest related to certain adjustments.
(l)Adjustment for certain changes in environmental liabilities.
(m)Adjustment includes amounts contractually owed to Exelon under the TMA.
(n)Adjustment for acquisition related costs.
Constellation Energy Corporation
GAAP Consolidated Statements of Operations and
Adjusted EBITDA (non-GAAP) Reconciling Adjustments
(unaudited)
(in millions, except per share data)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Twelve Months Ended December 31, 2023 | | | | Twelve Months Ended December 31, 2022 | | |
| GAAP (a) | | Non-GAAP Adjustments | | | | | | GAAP (a) | | Non-GAAP Adjustments | | | | |
| Operating revenues | $ | 24,918 | | | $ | (1,404) | | | (b),(c) | | | | $ | 24,440 | | | $ | 1,184 | | | (b),(c) | | |
| Operating expenses | | | | | | | | | | | | | | | |
| Purchased power and fuel | 16,001 | | | (2,365) | | | (b) | | | | 17,462 | | | 138 | | | (b) | | |
| Operating and maintenance | 5,685 | | | (343) | | | (c),(d),(f),(l),(o),(p) | | | | 4,841 | | | (28) | | | (c),(d),(e),(f),(g),(l),(n) | | |
| Depreciation and amortization | 1,096 | | | (1,096) | | | (h) | | | | 1,091 | | | (1,091) | | | (h) | | |
| Taxes other than income taxes | 553 | | | — | | | | | | | 552 | | | (2) | | | (d) | | |
| Total operating expenses | 23,335 | | | | | | | | | 23,946 | | | | | | | |
| Gain (loss) on sales of assets and businesses | 27 | | | (27) | | | (g) | | | | 1 | | | 1 | | | (g) | | |
| | | | | | | | | | | | | | | |
| | | | | | | | | | | | | | | |
| Operating income (loss) | 1,610 | | | | | | | | | 495 | | | | | | | |
| Other income and (deductions) | | | | | | | | | | | | | | | |
| Interest expense, net | (431) | | | 431 | | | (i) | | | | (251) | | | 251 | | | (i) | | |
| Other, net | 1,268 | | | 1,184 | | | (b),(c),(e),(m) | | | | (786) | | | 845 | | | (b),(c),(d),(e),(g),(j),(m) | | |
| Total other income and (deductions) | 837 | | | | | | | | | (1,037) | | | | | | | |
| Income (loss) before income taxes | 2,447 | | | | | | | | | (542) | | | | | | | |
| Income tax (benefit) expense | 859 | | | (859) | | | (j) | | | | (388) | | | 388 | | | (j) | | |
| Equity in income (losses) of unconsolidated affiliates | (11) | | | — | | | | | | | (13) | | | — | | | | | |
| Net income (loss) | 1,577 | | | | | | | | | (167) | | | | | | | |
| Net income (loss) attributable to noncontrolling interests | (46) | | | 77 | | | (k) | | | | (7) | | | 49 | | | (k) | | |
| Net income (loss) attributable to common shareholders | $ | 1,623 | | | | | | | | | $ | (160) | | | | | | | |
| Effective tax rate | 35.1 | % | | | | | | | | 71.6 | % | | | | | | |
| Earnings per average common share | | | | | | | | | | | | | | | |
| Basic | $ | 5.02 | | | | | | | | | $ | (0.49) | | | | | | | |
| Diluted | $ | 5.01 | | | | | | | | | $ | (0.49) | | | | | | | |
| Average common shares outstanding | | | | | | | | | | | | | | | |
| Basic | 323 | | | | | | | | | 328 | | | | | | | |
| Diluted | 324 | | | | | | | | | 329 | | | | | | | |
__________
(a)Results reported in accordance with GAAP.
(b)Adjustment for mark-to-market on economic hedges and fair value adjustments related to gas imbalances and equity investments.
(c)Adjustment for all gains and losses associated with NDTs, ARO accretion, ARO remeasurement, and any earnings neutral impacts of contractual offset for Regulatory Agreement Units.
(d)Adjustment for certain incremental costs related to the separation (system-related costs, third-party costs paid to advisors, consultants, lawyers, and other experts assisting in the separation), including a portion of the amounts billed to us pursuant to the TSA.
(e)Adjustment for Pension and OPEB Non-Service credits.
(f)Adjustment for costs related to a multi-year ERP system implementation
(g)Adjustments related to plant retirements and divestitures.
(h)Adjustment for depreciation and amortization expense.
(i)Adjustment for interest expense.
(j)Adjustment for income taxes.
(k)Adjustment for elimination of the noncontrolling interest related to certain adjustments.
(l)Adjustment for certain changes in environmental liabilities.
(m)Adjustment includes amounts contractually owed to Exelon under the tax matters agreement.
(n)Reversal of a charge related to a prior 2012 merger commitment.
(o)Adjustment for an asset impairment.
(p)Adjustment for acquisition related costs.
Statistics
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | | Three Months Ended December 31, | | Twelve Months Ended December 31, | | |
| | | 2023 | | 2022 | | 2023 | | 2022 | | | | |
| Supply Source (GWhs) | | | | | | | | | | | | |
Nuclear Generation(a) | | | | | | | | | | | | |
| Mid-Atlantic | | 13,340 | | | 13,942 | | | 53,012 | | | 53,214 | | | | | |
| Midwest | | 23,793 | | | 24,011 | | | 93,768 | | | 95,090 | | | | | |
New York(b) | | 6,709 | | | 6,483 | | | 25,546 | | | 25,046 | | | | | |
| ERCOT | | 1,721 | | | — | | | 1,721 | | | — | | | | | |
| Total Nuclear Generation | | 45,563 | | | 44,436 | | | 174,047 | | | 173,350 | | | | | |
| Natural Gas, Oil, and Renewables | | | | | | | | | | | | |
| Mid-Atlantic | | 548 | | | 524 | | | 2,014 | | | 2,097 | | | | | |
| Midwest | | 310 | | | 372 | | | 1,024 | | | 1,202 | | | | | |
| | | | | | | | | | | | |
| ERCOT | | 3,635 | | | 3,106 | | | 16,877 | | | 14,124 | | | | | |
Other Power Regions(c) | | 1,966 | | | 2,518 | | | 8,512 | | | 10,189 | | | | | |
| Total Natural Gas, Oil, and Renewables | | 6,459 | | | 6,520 | | | 28,427 | | | 27,612 | | | | | |
| Purchased Power | | | | | | | | | | | | |
| Mid-Atlantic | | 2,895 | | | 3,202 | | | 16,509 | | | 15,366 | | | | | |
| Midwest | | 257 | | | 185 | | | 984 | | | 610 | | | | | |
| | | | | | | | | | | | |
| ERCOT | | 818 | | | 720 | | | 5,530 | | | 3,575 | | | | | |
Other Power Regions(c) | | 11,317 | | | 11,167 | | | 44,192 | | | 51,131 | | | | | |
| Total Purchased Power | | 15,287 | | | 15,274 | | | 67,215 | | | 70,682 | | | | | |
| Total Supply/Sales by Region | | | | | | | | | | | | |
| Mid-Atlantic | | 16,783 | | | 17,668 | | | 71,535 | | | 70,677 | | | | | |
| Midwest | | 24,360 | | | 24,568 | | | 95,776 | | | 96,902 | | | | | |
New York(b) | | 6,709 | | | 6,483 | | | 25,546 | | | 25,046 | | | | | |
| ERCOT | | 6,174 | | | 3,826 | | | 24,128 | | | 17,699 | | | | | |
Other Power Regions(c) | | 13,283 | | | 13,685 | | | 52,704 | | | 61,320 | | | | | |
| Total Supply/Sales by Region | | 67,309 | | | 66,230 | | | 269,689 | | | 271,644 | | | | | |
| | | | | | | | | | | | |
| | | Three Months Ended December 31, | | Twelve Months Ended December 31, | | |
| | | 2023 | | 2022 | | 2023 | | 2022 | | | | |
Outage Days(d) | | | | | | | | | | | | |
| Refueling | | 56 | | | 65 | | | 256 | | | 212 | | | | | |
| Non-refueling | | 7 | | | 3 | | | 51 | | | 54 | | | | | |
| Total Outage Days | | 63 | | | 68 | | | 307 | | | 266 | | | | | |
__________
(a)Includes the proportionate share of output where we have an undivided ownership interest in jointly-owned generating plants and the total output for fully owned plants.
(b)Other Power Regions includes New England, South, West, and Canada.
(c)Outage days exclude Salem and STP.
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | Three Months Ended December 31, | | Twelve Months Ended December 31, | | |
| ZEC Reference Prices | | 2023 | | 2022 | | 2023 | | 2022 | | | | |
| State (Region) | | | | | | | | | | | | |
New Jersey (Mid-Atlantic)(a) | | $ | 10.00 | | | $ | 9.88 | | | $ | 9.95 | | | $ | 9.93 | | | | | |
| Illinois (Midwest) | | 0.30 | | | 12.01 | | | 5.18 | | | 13.88 | | | | | |
| New York (New York) | | 18.27 | | | 21.38 | | | 19.05 | | | 21.38 | | | | | |
| | | | | | | | | | | | |
| | Three Months Ended December 31, | | Twelve Months Ended December 31, | | |
| Capacity Reference Prices | | 2023 | | 2022 | | 2023 | | 2022 | | | | |
| Location (Region) | | | | | | | | | | | | |
| Eastern Mid-Atlantic Area Council (Mid-Atlantic) | | $ | 49.49 | | | $ | 97.86 | | | $ | 69.64 | | | $ | 126.14 | | | | | |
| ComEd (Midwest) | | 34.13 | | | 68.96 | | | 48.64 | | | 121.71 | | | | | |
| Rest of State (New York) | | 109.07 | | | 72.44 | | | 137.88 | | | 85.36 | | | | | |
| Southeast New England (Other) | | 66.67 | | | 126.67 | | | 91.67 | | | 138.21 | | | | | |
| | | | | | | | | | | | |
| | Three Months Ended December 31, | | Twelve Months Ended December 31, | | |
| Electricity Reference Prices | | 2023 | | 2022 | | 2023 | | 2022 | | | | |
| Location (Region) | | | | | | | | | | | | |
| PJM West (Mid-Atlantic) | | $ | 36.37 | | | $ | 68.62 | | | $ | 33.06 | | | $ | 72.90 | | | | | |
| ComEd (Midwest) | | 26.31 | | | 52.26 | | | 26.64 | | | 60.24 | | | | | |
| Central (New York) | | 27.33 | | | 47.40 | | | 26.97 | | | 57.52 | | | | | |
| North (ERCOT) | | 27.37 | | | 52.12 | | | 55.15 | | | 64.38 | | | | | |
Southeast Massachusetts (Other)(b) | | 34.95 | | | 77.07 | | | 37.35 | | | 86.02 | | | | | |
__________
(a)The ZEC price is expected to be $10.00/MWh for each delivery period and is subject to an annual update once full year generation is known. Following the latest annual update, on August 16, 2023 the ZEC price for the delivery period beginning June 1, 2022 through May 31, 2023 was calculated to be $9.88.
(b)Reflects New England, which comprises the majority of the activity in the Other region.
