EXC - Earnings call transcript Q1 2020

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Operator

Hello, and welcome to today's webcast. 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 will have a question-and-answer session. [Operator Instructions]

pleasure Vice today's President my Dan over now Senior Eggers, of is to program turn to It Corporate Finance. yours. is floor The

Daniel Eggers

available Thank who and earnings by Exelon's everyone, answer our morning, following Crane, They're Exelon's to call you, joined you Chief Chris will Exelon's Mary. joining Executive senior our Chief and for Officer. Officer; today and are of first Nigro, questions call. management other remarks. conference thank XXXX be members President team, Leading Joe the your quarter prepared Good Financial

assumptions earnings call, results the and of release made our found and forward-looking could that Please estimates contain Actual today's Exelon's which to issued in release both and be forward-looking today's earnings differ The on in other material We of to the statements risks factors differ this and based other other factors, SEC comments projections, that Exelon's management's to and matters, and morning, with refer can forecasts and subject section of filings our pandemic uncertainties. the cause website. for may are presentation, including which along the and risk statements the impacts surrounding discussions we from from results various Relations Investor call. factors discussed today's this during uncertainty of discuss expectations. during COVID-XX X-K

equivalent refer measures. reconciliations our and also operating the GAAP nearest includes presentation non-GAAP for earnings and Please contained to our non-GAAP between release presentation in Today's references measure. measures adjusted appendix and to information the other the the of earnings

to Chris call the Exelon's Crane, turn over CEO. now I'll

Christopher Crane

a quarter basis I'll share. a time. to off The basis non-GAAP everybody start quarter the $X.XX with seen warmest of earned earned GAAP Thanks, Dan, the strong one $X.XX results. in with share, we've first winters We thanks per joined long first that's today. had even and per

operations his very throughout details We to the is remark. those solid quarter. going cover all had in Joe first

we on outage I'll and groups very Hearings legislation, Illinois continue. now, in nuclear and outages are meeting. is further duration frequency Energy quartile record-setting refueling working which that right critical Clean First as go into on

is discussion will on, only they capital to issues needs priority not determined but budgets of session the back work, resume all legislature how get to think into be the other I understand going but we haven't for The the still and in Illinois. what energy, done,

we So continue that to will through work on May.

throughout the focus Our one this wellbeing focusing employees. and of number been safety our has on pandemic

we the as mission-critical Our remotely possible employees in many working know are are in They as on of mission. supporting a critical infrastructure.

approximately have contractors their employees and remotely XX,XXX faults. on tasks We people, any execute being another without X,XXX able to and working

the pre-screening. So plants, and with the workers, and protecting our that system are the workers we’re frontline contractors gas power electric in XX,XXX the distancing social PPE, maintaining frontline

COVID have plus We sick we've result the or have We've or charge diagnosed had total no XX things. laid-off in to pandemic. and or have COVID to returned not reduced pay with of done XX been furloughed employees those hours pay Employees status work. remain leave. back as couple with diagnosed XXX of Overall, count contractors. a a

we and wellbeing. health the the so to And and focus continuing safety are on

employees. become them to us all of in give from at facilities, If providing time, to also mechanisms allows are other which pay keep quarantined. our them not their only quarantine families of We that safe, amount full the being tracing we're required employees they've through but that our and contact we

care access to for dependence. expanded backup also We

of their about not children have to frontline their out So employees field elderly out employees or school frontline supporting in those that need in the to workspace are be the worry do parents.

up grid safety, providing service are the on keep own gas and power everybody their employees another the to focused and keeping keeping to the that's we job, keeping running. plants the the So flowing, one,

been and will a always you'll what do, Slide support we've what see big we On and of continue what part our to customers we doing communities. X, do is

heard late or the reach know, fees disconnected. since reconnect utilities disconnects, all did and had customers been waived who reconnect the X we new and suspended and As out had individuals that you those offered March to you disconnected to been

are energy we one And people provide. to this are of ability can social people financially laid the in needed the for us most challenged have sources gives or that that times that critical off and

at companies, contributed can need, continue food over that. this and also, programs ensuring focus Foundation to of to be more organizations, other supported $X.X the during we'll on We have our banks relief time Exelon than and million and

as our But facilities, company grocery stores, a see at production more reliable of is operational have the to even healthcare lights organization excellence, can now. on we food that Keeping strong this everything, the power, community And you crisis, there. critical the safety which is priorities service, hospitals keeping an providers, is medical and after at right the utilities. in that list in the and to, the continue with core the have of are

We've safely ourselves but restored had the been resources safely field more them and in employees, to and that shelter April. the spring power. adequately moving work territories early storms allow our do able in March late already customers on able to across restore service and We've being to test to than the this XXX,XXX and year. We in

the On rewind the planned. all eight to There's closing left has seven a up nuclear outage Ganey later the refueling that better will this of Station. power side, go than be in completed outages, refueling major one on group month,

outages you between it's days. class world of if the been plants, being look XX with performance performed But XX the and the majority at

about XX work. you employees four XX infected have and look contractors, returned virus, trying that all we've had have COVID these to only – including the with times, XX have If been employees but

as facilities are we've earlier, the has care expanded that So the critical And come extra the families social operate been I need that we to needed, to allowing mentioned with are and our doing resources. work that very resources and PPE, those distancing us. to critical in

and We've power at done outages summer issues. completed for all without readiness, readying XX maintenance our facilities

– that's the So the on. of we what operations and are focused with view that overall

I'll it through And to over the to financial. turn Joe go

Joseph Nigro

and Today, including remainder quarter full-year morning, I cover financial and the year. impacts Chris, of of the the first our everyone. you, updated and Thank for good results will guidance, our COVID-XX sensitivities

Starting with basis, range. our midpoint earned share per a the basis on non-GAAP on guidance Slide below a $X.XX per XX. of was We share slightly $X.XX and which GAAP

with through in $X.XX March, to per degrees share seven us are of in one results had on the winters than non-decoupled considering Exelon average costing Mid-Atlantic in between January our were particularly We the Temperatures five pleased we record. Generation the warmest utilities. higher

was of by most the quarter merger. PHI weather This the since quarter impacted any

net share expenses. company Exelon of Utilities holding delivered $X.XX per

Our and City days to were were quarter. down the non-decoupled These during degree O&M Atlantic XX% the Delaware Delmarva, utilities, by winter warm were Electric heating utility. by territories, partially the impacted XX% weather. across offset impacts these PECO, Across timing

also was and gains. per by gross first outages the impact earning O&M weather, in were fund weather and by decommissioning on quarter. $X.XX share favorable margin ExGen offset FitzPatrick nuclear The impacted trust unplanned at Salem and

are and states spread ComEd, Turning full-year in and including outlook. $X.XX to have $X per unfavorable weather demand Taking share. the to the orders share account our COVID-XX, from in national guidance Slide combat revising electricity impact lower $X.XX of to Efforts ROEs caused we economic of range into our at the XXXX XX. dramatic $X.XX to changes to per COVID-XX stay-at-home

of we at we a typically in COVID-XX the so stand complete the of include picture While estimates guidance want this to would where the change and in provide not early year year, best impacts. we our point

Let range, to to has anything In saying the impacts, economy and continue by ever our evolve. for seeing the me developing April, that before. data looked of economic our and changes load none we year guidance full start different expectations us considered we The like economic outlooks. structural customers revised duration and to about the in including experienced talk the this at were their

load on residential X% increase In X% and load by region. X% XX% to to commercial industrial we QX, the depending to decrease by to expect

expect we unfavorability residential the industrial commercial, economy favorability and Over to the recovers. as diminish of remainder the year,

taken guidance this our assumptions We've cautious of the view underpinned on see that new world a and can you range. the slide

the so our guidance a calibrate. the so of on following you to pages show recognize we sensitivities We can that number rapidly, also changing is situation

taking. I to offset $XXX company our also want challenged this to the pressures identifying on are against other reflect to in point costs We the organization and forecast. of the and These come profitability. current backdrop, we which back provide actions to million across a updated initiatives lower we pursuing improve our

less little over the mild $X.XX the at degradation a $X.XX the utilities, first can XX-year ComEd for into the split At weather. to per $X.XX from be in prior the for drop little and quarter lower treasury distribution a ROEs guidance due record share than

non-decoupled expect we through cost the higher be debt. allow to impact for to at of For expected regulators and able lower bad our of offset utilities impacts, our the that recovering COVID-XX-related assumption timely reductions loads

mild At cost drag then $X.XX reflects business of ExGen, weather net per and very load the QX on $X.XX degradation COVID-XX the initiatives. $X.XX from and share of of impacts our

and million In addition CapEx to by remained in have focused savings, cash lowered at on we $XXX ExGen the XXXX. O&M

the $X.XX We operating adjusted most earnings per and guidance to expect our second of share. impacted quarter in $X.XX to be provided earnings have

XX. the utilities COVID-XX on at impact Slide of Looking on the

for we customers. class The distribution the not PECO, Delaware, the As ROE table year. at volumes In right, by utilities, of the are subject you that non-decoupled commercial for Electric provide Delmarva, and Atlantic revenues majority and load bottom are of can remainder see, XX% the and Utilities of to the fluctuations. customer ComEd's load the industrial Exelon sensitivities decoupled are are City

COVID-XX Atlantic in debt and being impact with Each debt and not Electric with working respectively. the the existing we result of bad is no utilities earnings recovery bad cash have have recovery recovered cost in and mechanisms mechanisms do XXXX, that them. where on ComEd regulators City XXXX our

of prudent DC the PSCs in atypical costs a month, allow that orders incremental debt bad asset and Maryland tracks or related of regulatory authorize COVID-XX-related assessment for to issue to incurred, costs an which pandemic. will recovery the Last

New stakeholders bad our potential Delaware, are currently regarding of appendix, recovery of recovery commissions debt We provide in we detail the mechanisms. On these and with Pennsylvania costs. engaged the efforts XX and current on Jersey Slide more and

annually of impacts those XX, Constellation’s retail, fixed Constellation like XXXX Slide Constellation XXX business industrial breakdown and customer of its retail load and terawatt wholesale of around XX% those the of hours to on non-decoupled In the was channels. a customers, through XX% contracts. utility. customer Turning were commercial and them delivers are of price

When rest index and COVID-related at contracts, XXX hours volumes we exclude demand exposed we of load of normal year have terawatt the to annualized about for look the destruction.

in assume of For load down X% we year, down is the X%. Constellation and last C&I months increasing the nine with X% residential total

fixed price by amount COVID-XX, to contracts a Constellation’s explain. how ways. there've a minute customer the and about know load are customer in fixed fluctuations I me are take that electricity been price questions These will so certain in impacted let by impacted assume contracts three of usage use

we and load lower First, of impacts value; margin; collection second, on easing environment. price third, of are commodity seeing the fixed current charges through and the

is lower, over contract time. When on When become at be unconsumed market creating Constellation the price less generation the hours. in the load the the assumes for electricity for market revenues. can customer original than If loses consumes a it of a of in sales contract. gap the and at a contracts current term forward the those signed, margin money sold procured the open Customer a is out customer price a must into is price higher over megawatt the forecasted, the lower than then and power

by ISO. transmission charged billed are are that for capacity customers the Finally, and charges

we basis. a them Although these typically for quantity many megawatt them collect on of the expected per electricity customers are hour unitize over and fixed charges, dollars

responsible consumes due shortfall. when fixed to collect are ISO for So and the we customer the under less, the the charge

that the risk the due be can where not In we and assumption could negative predicted our demand contract. have and line. a seeing shocks That or normal is assumed positive primarily fluctuations pandemic. of load are driven bottom to by in fluctuations are the impacts risk to world These the weather, in priced

load are we on displaced, guidance. is where significantly margin, gross our is pressure C&I our which reflected XXXX, in In seeing

the assumed to very also that We limited pandemic the actual differences in in drives drop expect be and time the in to usage. profits wide period

and will And profitability be highly the industrial conditions. normal future, our Constellation levels commercial to return to the business strategy. those unusual similar remains to having key under besides our situation, load this to customers primarily Looking

exposed circumstances, to C&I residential C&I load C&I aligned load less much customer predictable portfolio, its baseload than normal usage higher First, patterns customer is weather customers. with are our generation and load as In is to load. stable fluctuations more than due residential factors

cannot customers be to achieve us residential customers. that scale done with C&I allow Second,

these not are C&I. higher account margins to residential gross cost for margins customers, maybe the the higher which these on although than Finally, customers, acquire do

and You gross can on see our the impacts Slide COVID-XX of XX. weather margin on

$XXX total million pretty be XXXX, margin volumes can is customer which $XXX and between In gross due lower weather, million. on our is power down evenly QX to gas split businesses.

reminder, our COVID-XX in million the entered due its margin business We’ve on impacts most to a $XXX of of the of As lower balance a year. gas makes the winter.

During the we executed business new respectively. quarter, in $XX business and $XXX non-powered million million new powered and

of prices quarter, total power a most well COVID-XX-related decline. some $XXX lower million primarily the on of gross New York load PJM a rebound year, carry have end in the power of above drag the prices XXXX, gross the Since of over as levels margins seen to In we start margin down the in the due business. as modest recovering

executed during also non-powered and new quarter. We million the of powered $XX business

hedging to in behind the XXXX. and reduction the behind XX% end XXXX X% hedges is slightly X% offsetting to in at We've ratable load ratable. then due remained to X% at both quarter. ended our ratable during the made year more XXXX We behind program XXXX in quarter

volatility. continue certain We to significant prices rebound a power markets, some are but expecting or see upside in in not

Slide provides of projected uses XX XXXX sources and cash. our

and million timing to we utilities disclosure. $XXX receivable million the free is debt, from reverse. accounts cash degradation, due which largely our Our cash to flow bad down accounts expect of flow last for of $XXX The

ExGen's flow gross CapEx. down by is cost free margin reductions but mitigated and million cash $XXX the reflecting decline, lower is

is strong. Our liquidity position

down As commercial you in drew disruptions April. which ExGen's on know, in significant we credit billion paper in billion March there were we facility, $X.X the temporarily $X.X early markets and repaid

holding corporate, uncertainty in at billion us company in we million that issued flexibility. which market $XXX [June] gives the in additional $X Given refinancing, a April

our We that needs. are ample we confident have to liquidity meet

credit remain also strong to grade committed investment We ratings.

of Our fall FFO our to which previously I and combination XX% XX% to FFO higher projected and XXXX lower to is pressures target, below to to debt is disclosed. in due the XX% debt the reflects

our the year issues to understanding our and see that take can impacts in levers current next market profile. timing some to of XXXX utilities expect FFO We to to we the unwind. improvement they the were persist, as cash the enhance We credit from and of their have If environment. the in agencies COVID resolve we talked rating

I'll call now Chris. turn back to the

Christopher Crane

Thanks, to unexpected Joe. The pandemic has brought challenges our business in XXXX.

challenge, offset to unique three cash of of increase can the the and profitability ways found have much through done. We financial impact We'll we're quarters. not look We flow but to next continue ways. this for

is not business on the impact remains fact Exelon's does strong the COVID-XX our and fundamental change The strong. that strategy

base, add size the is growing that Our X% in next billion utility to annually base $XX In four ComEd. for utility rate we rate time, will over years. the a of nearly than more adding equivalent

quartile rest first competitive customer the reliability the most a bring the way continuing and premier of in customizable solid the platform. generation providing the satisfaction are our Constellation first performance best-in-class integrator quarter operations are to customers. while is utility for of It's – to solutions needs to fit their in year. market Our performance effective

generation the the cleanest nation. Our in fleet is

every Clean are Energy of We portion of of out Clean nine in Energy. significant a the delivering nation's megawatts one

nuclear essential ensure air our fleet and continued it compensate will in role reducing their plays carbon that policies for advocate and to continue We for operations. the pollution

If our on XXXX. to a a We're you The XX, unchanged. growth utilities, value our X% this. base focused on rate proposition I'll targeting is growth close at growth proposition EPS X% through of and with look X.X Slide value

and growth But we the low. if needs that was We're confident and our ROE serve. on for also that continued the investments stay ComEd's customers these to for has the base impact the rate growth rates, this in on of EPS treasury we're that mindful impact the in XX-year distribution rate current rate

support utility from ExGen the flow cash and paydown free debt the dividend. ExGen external use will to We support growth,

value value seeking their uneconomic maximizing fair zero-emitting to monetizing closing business continue Genco Constellation. plants, the and through our for optimize fleet, will of our by assets We compensation generation

a sustain will rating throughout this period. credit investment We strong grade metrics

for now it questions. can you. up we Operator, Thank open

Operator

from Byrd from first comes Our Instructions] the Stanley. [Operator question of Morgan Stephen line

now line Your is open.

Stephen Byrd

Hey, you well? morning. doing good Hope are all

Christopher Crane

too. are you Hope

Stephen Byrd

of talk they Health what wanted could guidance thanks sort just the gave disclosure, around might legislative Illinois helpful. you. very closely as The we're Thank able the how be of as for thorough to the to first trying – I and I Public circumstance legislature Department – to can. we under update reconvene. process, follow Illinois some to guess this

the of reopen. session summer, state’s process sort obviously, legislative a have meet well legislature of meet the meet given date some sense of department sort sort ending business? through for sort to very ability potential terms and the just coincide and to not What for does of the do you does to legislature with it of plan the there's in Do look formal of But your the the like the that maybe guidelines. able the go potential to these May, is sense in if health they

Christopher Crane

We specifically bodies forward have Kathleen, here other and seen in the convene. in jurisdictions, want to able Illinois? through you to path work talk to be legislative

Kathleen Barron

as the order May. Sure. stay-in-home does through then know you Good end Steve. morning, extend And that of –

is Senate the a to or the Speaker. after will Even in can session remains legislature could bring under and on So Governor see whether it to they in session. the to good could session capital how but himself come seen progress, President a be just call special is good constitution. the guidance a May bring back back the folks to – That leaders come Public of might they Department agreement May, decide to they summer call this back Health people Springfield it to sign They good of the safely. by XX cannot back the if the the

that been not just There's there So we're come yet provided. back. any guidance to they will indication glad see has when exactly about

Stephen Byrd

A your a related completed nuclear plants of as Understood. I a of lot terms been well. in Chris, And matter uncertainties of in quite quickly and you has then in for guess just lot refueling operational decisions mentioned Illinois, there. had

so get legislation a there have you they obviously all have you Illinois? considerations time that call their in bit this, if given, for you of it, to in Or would some are can lot example, But any address on recession? do some make, a to is flexibility, not passed just operational the plate legislature have

Christopher Crane

to tough COVID, the speculate go It's of session. this and run the legislative Yes. stated into end an able committed What being their the going PJM with all what towards the and with of the extended. be extended everything time we've to stressed on is is the to could that to stakeholders was session outcome or auctions, year

that it statement haven't We was any of. I extended that gotten public know

So are goal any detrimental they’ll by we're to up in those auctions that capacity of the is be highly will being run, units, clean once states a clean fossil auction, confident XXXX. against of compare that we're replaced clock. which by And or our minimal megawatts XXX%

clock about renewable So And megawatts. the stakeholders only key importance timing on others but and legislative the of importance not speculate But decisions megawatts, stressing for now. the importance to the we're wouldn't the nuclear and administration just is the the I for ticking. right the

of reasonable. in the with be state to to able So been that's continue Illinois a profitability invested have to they operate

now. the stakeholders, we'll that. at conversations we're leading to continuing Kathleen, through the push and where on Von Hoene Bill are continue legislators We're and right dialogue. the that's state So the

Stephen Byrd

let I'll good. others questions. Thanks. Very ask

Christopher Crane

Yes.

Operator

comes Fleishman of Next from line Wolfe the Steve LLC. from question Research,

now Your open. line is

Steven Fleishman

morning. good Hi, Yes.

Christopher Crane

Steve. Hi,

Steven Fleishman

rates X% rate. mindful, little comments ROE wanted more X% be more I Chris, the XXXX. – Or think been and you've kind obvious still – on you you're of within But said, can think, for you guess about assuming just are if a Hey the how – about there? utility I to better, what you growth don't a I the for And you'd on to embedding you just in little give color just of rate to on what maybe the that mentioned color Illinois get it's range? how broader and get growth now

Christopher Crane

Yes.

continued have our We to work five-year plan.

gave we plan, it's flow some cases, a continuing a plan, allowed helped also has doing reliability customer think but plan is a last in five-year three in cash our it a four-year us report reduction. us on another profitability range so, rate maintain places out rate and and significantly to satisfaction long and actually while in I we're the and we

So on this it economy would as the renewable plans we could as on make whatever for adjusting. efficiency adjusted. the you and it. be able you We can system plan impact plan on. and needed more be time, degrade, the to The scenarios. in expect, of distributed look customers, multiple the happen onset is don't on continuing But won't continues and out at the we don't much to we It And if coming do imagine, much be at energy future. facilitate if to the reliability modifications and prepare can investments

not we're or we I that that day to a in back. near see go that haven't seen we see we day future. don't path a seen and getting that mean, the If haven't return

the on and we're recovery So the mechanisms. with and watching the watching investment treasuries continuing

Steven Fleishman

Okay.

lower know to of just within exactly if where You're XX-year kind to the So clarify don't X% we're still rate of – in these expected range? I X% is? but forward the environment, curve be – to the whole

Christopher Crane

Joe. Yes. Go ahead

Joseph Nigro

changing We're of target the X% not the to X%.

to forward target the Chris make. plan year. investment said, update We with moving As a that we once we're that

also ComEd Obviously We of impact. ROEs. year since an first the the to related some show sensitivity you dropped the has they've

we'll and to bands earnings ourselves out to gave that you challenge XXXX regard. for you well continue within give through this in we're ways we and gave we bands also still the that look We you

Steven Fleishman

Thanks, Joe. Okay.

Christopher Crane

for investments needs. be us done efficient the support on very an rate. long-term most would prudently customer's The get point, this be to very start, the would it stop stop, start, is At interest short. and way depending It shortsighted to

Steven Fleishman

saying. Got it. see you're I what

on state that not back going the Got in being it, rates the okay. you're of to temporary Chris, because So hold lower. investment saying, you're

yes. other one your levers Just question, for on question credit. mentioned you I Joe, just other for One – guess

stay You profile. I have are? weaker give If those could just things you there, levers on what on some guess your color credit levers

Joseph Nigro

ourselves in reducing $XXX the been We that think proving ourselves our regard. would that with continue by of future record Those have this in have we've taken to we be continue to I that I going we're on would got We've cost Steve, to million that. address. costs our a we structure. on actions year plants we we're two track and mean, we're economic that to and rectify challenge hard challenge would levers clear working power some to have to address that. big we've

Steven Fleishman

you. Thank Okay.

Christopher Crane

Thanks.

Operator

the Next Guggenheim. question comes from Shar line of from Pourreza

open. now is line Your

Shar Pourreza

Good Hey. morning, guys.

Christopher Crane

Shar. Hey,

Shar Pourreza

in couple a but PJM, speak you a everything is is directionally a high at level Realize the but with uncertainty questions something at think margin just over is can this ignoring significant bit veto point, there I little going And to get capacity you this Illinois, done do the So reform. how on, with from gross realize upside here. or secondary of Maybe Illinois XXXX at still developing? can downside session?

Christopher Crane

from their on be it PJM. would will on to still have breakaway for get own IPA would we've time what do. able before the Where develop We auction to we allow hope working. session. of the the give us gets we that stressed That's Illinois capacity state process, still the to to needs We're significant have support end of done, it done to that what

a timeframe. Illinois it's they If this they had to by requirements on them were tight the able As we summer a to we session a would in, assurances, earlier, session with very the and that. were in work continue under going address Health, to summer said I in come

that of also address state a budget and things a that other with done in large along some very they the realize important this have but issues. Springfield, But to to issue get there's lot in is

to there's done. fast this we just get work. So work get and to get know It's we to a the to way will can how

Shar Pourreza

retail about C&I And broadly strategic your and hedge? you maybe state look been sort view, XXXX retail any the we've natural on just current your how in of attrition does opportunities we the the tighten are And level, the at on present what look sort some the we seeing up of potential as guys And of of acquisition guys opportunities Got then more in off reprieves beyond? at any think side it. Or side? do expecting as to kind of does sort push situation that assumptions? you contemplation

Christopher Crane

do Jim want Jim, you that cover McHugh, want – to you one? to do

James McHugh

answer Sure, absolutely. parts. I'll kind of two

what the we're a recover, is now in on that think we reopen states from seeing reduction I low decreases and things the as XX% as we're about expect in seeing C&I average these By range mentioned Joe front-near year, X% probably on a as more back that's the to of the months. than in and end next coming X% call the through mid year.

and temporary from expect that I back. bounce load it's to we perspective, a So think

looking be of platform. things, couple buy to There business. We've of of we'll books would our look before. that when for definitely a into We'll world-class look same, over a space, for books to we've that that would can comes we we stay could business to that things, developed, perspective, suppliers any be that we value bought strategic is fit a platform acquisition could strategy easily think, I the books integrate from the our over some before years continue shown books. buy think we easily. we need of market. I which about to talked their the And We've

either that access just the for and we products have. customers other refine associated to look demand to it's think to products sustainability analysis we'll And with product development data can develop look that look faster more the strategically they where or I then targets sell for them give charges and now fixed to be continue lastly, charges either that and could we

Shar Pourreza

for nature that Can the how rating $XXX just our And from in transient I savings understand the to about modeling a in reductions XXXX? the it. the ExGen think million Joe, cash flow agencies remind ongoing you dip is Got cost just perspective, lastly, CapEx obviously highlighted perspective? and perpetual know just how you us

Joseph Nigro

million say most item. Yes. of a viewing as $XXX now one-time I the would right we're

some the are IT it's spending, like reducing reduction spend, vacancy driven things you all the O&M. think in And in when our about non-critical rates holding in look organization, by being those at contributing when contractor consulting travel you situation reductions spend, of to with of things reducing spend,

I frankly, some second maybe year, ways of go and costs. will had And and determination of at given challenge find end yet. process, these planning late we able begins here carryover savings that we've when reduce in some quite say periods. things, track to though, the through we've which we're the the of a ourselves a the We to our haven't just in record of learned and look continuing as through on the we quarter made environment future cost to we

Shar Pourreza

I'll Thanks someone to Terrific. pass guys. else. you. Thank it

Christopher Crane

Operator, caller please. next

Operator

of Next question James from Capital line Thalacker comes from the BMO Markets.

Your open. now line is

Christopher Crane

there? you James,

James Thalacker

guys hear you me? Can

Christopher Crane

can we now. Yes,

James Thalacker

Okay, that the just to This change XX, is could about a December non-powered I little million, but just guys thank looking business bit from on if guess there a new was I bit bucket. in obviously you question, you. of a in $XXX what's granular exactly more go. a little wondering Slide was talk

Joseph Nigro

margin total weather the you in to in for of in balance impact disclosure. attributed a The partially I had year. That's business Yes. all embedded is related million powered non-powered change that remarks We my and reduction said to million partially, as the in took and new gross on to the QX. $XXX in prepared we $XXX non-powered hedge go execution see the a both and

James Thalacker

a Or Okay. understand… that are specific I to you selling was wondering, just weather where it saw impact? product the that you trying just was guys

Joseph Nigro

piece the is the our the see so to big in of it And since related is impact it business. our embedded What's bulk winter, go, non-powered – there. that you that's seasonal of and gas to

James Thalacker

Got it.

So it gas. was just retail

Okay. much. Perfect. very, you Thank very

Operator

Next question the of from line comes from Chopra Evercore. Durgesh

Your open. line is now

Durgesh Chopra

for Thanks question. question. quick clarification have taking I my a just

You had. I answered most of things the

that. to recovery or want In $XXX of future, riders that million like terms debt, of the assuming don't don't kind the cover you just bad right? costs have on clarify COVID So those of where just states cost targeted territories reductions you’re in

Calvin Butler

in we commissions rider, establish where assets. do jurisdictions have In all is we don't. are partnership sit bad a our not Calvin. for not with they working and – are our debt No, This back to and regulatory of the we

and As And and alluded the what to to DC, operating set their reasonable. of passed incurred operate regulatory commissions assets allowing it's his standard just Maryland that under same opening used and up set to that showing also prudently comments, were in utilities the identify COVID-related both will costs. aside regulation on, Chris unanimously we

to commission rulings are the in commission and from and hope XX week have days that. them with to Pennsylvania we Delaware next the drive to working We

end regulatory the COVID-related jurisdictions, at costs those this, operating are. will costs asset under and debt be of of a our are believe to So we all the what show bad

Durgesh Chopra

much. guys. for it That's Perfect. very me you Thank it. Got

Operator

Next America. question comes Bank Julien of from the of line of Dumoulin-Smith

now is line open. Your

Julien Dumoulin-Smith

Hope you morning, Good well. all team. Hey. are

Christopher Crane

good. We the Hope are doing same you. for

Julien Dumoulin-Smith

Excellent. perhaps bit far. the you. I Thank thus to of follow-up, some up on wanted clean questions little a

treasury, the back anything to about in First, oscillation with Obviously, respect not the coming you're missing different But in slightly XX-year anything, outlook? question. to your here, we're to the slide CAGR just how the shifting Steve's is else so sure make earnings I want and for that. thinking

Joseph Nigro

Julien, else there's that the treasury. other than shifting nothing CAGR XX-year

Julien Dumoulin-Smith

portfolio here that. as in volatility as on in about keep think XXXX, reflecting more how degradation that mean you you as we've the the are sense, us aside. Constellation the And – play of well Okay. optimization give or XXXX in you Can could be faster slower extra Glad what and of overall, little when about dynamics clear I to just saw well a sensitivities here C&I here. to out the that one if Separately, of improvement ExGen and set as a improvement sales a business context some can bit I of Thanks. as further well. you that

Christopher Crane

do Jim, can cover that? sure I'm you XXXX. want but we we've XXXX to covered yet, cover not

James McHugh

the to Thanks, The way of this Glad balance and think talk do Sure. XXXX. year, I'll we Julien. it. about about then

about see You is see for X% load, income every net change the $XX sensitivity impact about in impact. a million million on the $X that a you resi slide and C&I

slow a next of year. balance as We've through this and assumed, return said, year the we into

expect. least or So that's number say, it would do those over X% X%, you the what the up down allow across well, you moves if to months, sensitivity is at

being margin to-go we've optimization far our I as estimates, we to activity business these new with activity sight with to hit remainder in optimization see given normal think as – able gross of this the you, the of the line bucket.

expect We impact year. basically we these So balance realign much there. of too adjustments of to to don't have targets these with now good sight the line

on because activity are more into that also $XX up included but is people in. that sign of represents has we've about of business of impact million little slowed customers it work the a that down status load just to XXXX, an of COVID trickling the some impact the bit the for the and new year, of fact For

a new and right tracking that rates little the feel been April. able been of dip we estimate that's to of a we've the good customers. and pretty like signing of maintain bit month in renewable and good for win up now really We've A

which being rates up able back are much, renew million those levels is good normal included $XX rates As we've bounce a the on to, those I how we estimate. to really get understand granular on and win impacted think and by more

Julien Dumoulin-Smith

you Okay. want a that Excellent. that With you or clear. briefly. to date of respect want using, have XX-year If don't prior you're extra what the EPS for to specific clarify be that. can assuming your treasury the as response are very I date you know just CAGR, curve to in that I Again, I just establish if

Joseph Nigro

Yes. the using, is the the of end first quarter. date we're X/XX

Julien Dumoulin-Smith

XX-year for treasury, so. of the the End first quarter

Joseph Nigro

Yes.

Julien Dumoulin-Smith

you. Okay. Excellent. Thank

Operator

closing are no at have There Chris you do remarks? questions this any Mr. further Crane, time.

Christopher Crane

joining you that their for thank dedication these I hope I I you Yes. will families you for the of that, and call. want the And employees And are unprecedented healthy. all No, with commitment in all your and Thank much. very to safe our times. call. thank out and close

Exelon (EXC) 8 May 202020 Q1 Earnings call transcript