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Con Edison, Inc. Reports 2003 Earnings
Increases Dividend for the 30th Consecutive Year

NEW YORK, Jan 22, 2004 /PRNewswire-FirstCall via COMTEX/ -- Consolidated Edison, Inc. (Con Edison) (NYSE: ED) today reported 2003 earnings from ongoing operations of $624 million or $2.83 a share, compared with earnings from ongoing operations of $668 million or $3.14 a share in 2002. Excluded from these results in 2003 are impairment charges for certain unregulated telecommunications and generating assets and the impact of a regulatory settlement, partially offset by the cumulative effect of changes in accounting principles, and in 2002, the cumulative effect of changes in accounting principles. Including these items, net income for common stock was $528 million or $2.39 a share in 2003 compared with $646 million or $3.03 a share in 2002.

For the fourth quarter of 2003, the company's earnings from ongoing operations were $146 million or $0.65 a share compared with $120 million or $0.56 a share for the fourth quarter of 2002. Including the items noted above, net income for common stock was $50 million or $0.21 a share in the fourth quarter 2003 compared with $118 million or $0.55 a share in the 2002 period.

"Con Edison's utility operations performed very well in 2003. For the second year in a row, Con Edison of New York was named 'Most Reliable Electric Utility in North America.' This award reflects our employees' dedication and our continued focus on the basics of our business," said Eugene R. McGrath, Chairman and Chief Executive Officer. "We're pleased to see that the economy in New York has clearly turned the corner. We are well positioned to participate in the continuing recovery."

The company also declared a quarterly dividend of 56-1/2 cents a share on its common stock, payable March 15, 2004 to shareholders of record as of February 11, 2004, an annualized increase of 2 cents over the previous annual dividend of $2.24 a share. This represents the company's 30th consecutive annual increase in its dividend to shareholders. "The dividend increase reflects our continued confidence in our business and the underlying economic strength of our service area," said Joan S. Freilich, Executive Vice President and Chief Financial Officer. "While our earnings have been negatively impacted by the recent economic slowdown and by increased costs at Con Edison of New York that are not yet reflected in rates, we remain strong financially, with a solid balance sheet, good liquidity and above average debt ratings."

In view of conditions affecting certain of its competitive activities, the company recognized impairment charges of $159 million ($94 million after-tax) for its unregulated telecommunications and generation businesses in the fourth quarter of 2003. The company is evaluating strategic alternatives for the telecommunications business. In addition, the company recognized an $8 million ($5 million after-tax) charge for the settlement of a proceeding regarding outages at the nuclear generating unit the company sold in 2001.

The changes in accounting principles in 2003 were the adoption of new accounting standards requiring fair value accounting for certain power contracts and the consolidation of variable interest entities. The changes in 2002 were the adoption of new accounting standards for goodwill and for certain contracts involved in energy trading and risk management activities.

The following table is a reconciliation of Con Edison's earnings and earnings per share from ongoing operations to reported net income for common stock and earnings per share.


                              For the year ended      For the quarter ended
                                 December 31,              December 31,
                                       Earnings per              Earnings per
                             Earnings     share       Earnings      share
    (Million of Dollars,
     except earnings
     per share)            2003  2002   2003   2002  2003  2002   2003   2002

    Ongoing operations     $624  $668  $2.83  $3.14  $146  $120  $0.65  $0.56
    Telecommunications
     asset impairment       (84)    -  (0.38)     -   (84)    -  (0.38)     -
    Unregulated generating
     asset impairments      (10)    -  (0.05)     -   (10)    -  (0.05)     -
    Settlement regarding
     nuclear generating
     unit sold in 2001       (5)    -  (0.03)     -    (5)    -  (0.03)     -
    Cumulative effect of
     changes in accounting
     principles               3   (22)  0.02  (0.11)    3    (2)  0.02  (0.01)

    Reported net income
     for common stock and
     earnings per share -
     GAAP Basis            $528  $646  $2.39*  $3.03   $50  $118  $0.21  $0.55

    * The weighted average number of shares outstanding used to calculate
      earnings per share was 221 million in 2003. Excluding the impact of new
      equity issuances in 2003 and 2002, the weighted average number of shares
      outstanding would have been 212 million in 2003.

The following table represents an analysis of the major factors affecting Con Edison's earnings per share from ongoing operations for the year and fourth quarter 2003 compared with the 2002 periods:

                                                       Year       4th quarter
                                                     2003 vs.       2003 vs.
                                                       2002           2002
    Con Edison of New York:
      Impact of weather in 2003 on net
       revenues versus 2002 (estimated)               $(0.03)        $(0.05)
      Sales, adjusted for weather (estimated)           0.15           0.03
      Lower operations expense                          0.11           0.07
      Regulatory accounting/amortizations               0.06           0.14
      Increased pension & other post-retirement
       benefit costs                                   (0.24)         (0.05)
      Higher depreciation and property tax expense     (0.12)         (0.03)
      Regional power outage (estimated)                (0.03)            --
      Other                                            (0.04)          0.05
    Total Con Edison of New York                       (0.14)          0.16
    Orange and Rockland Utilities                         --           0.02
    Unregulated subsidiaries and parent company        (0.17)         (0.09)

    Total earnings per share variation from ongoing
     operations                                       ($0.31)         $0.09

The performance of the unregulated businesses in 2003 reflects lower merchant generation margins and additional costs related to generating units placed in service and lower than anticipated revenues in the telecommunications business.

For the year 2003, amounts of electricity, firm gas and steam delivered by Con Edison of New York, after adjusting for variations in weather and billing days in the period and the August power outage, increased 0.6 percent, 3.6 percent and 0.9 percent, respectively, as compared with the 2002 period.

Con Edison expects its earnings for 2004 to be in the range of $2.60 to $2.80 a share. The forecast reflects increased pension and other post- retirement benefit costs, insurance premiums and depreciation expense, partially offset by sales growth. Con Edison of New York has filed gas and steam rate proposals that would take effect in October 2004 and expects to file an electric rate proposal this spring, to take effect in April 2005, at the end of the respective current rate plans.

Regulated utility construction expenditures for 2004 are estimated at $1.1 billion, compared with $1.2 billion in 2003. Unregulated subsidiary construction expenditures are estimated at $30 million in 2004 compared with approximately $100 million in 2003.

Refer to attachments to this press release for the condensed consolidated balance sheets at December 31, 2003 and 2002 and the consolidated income statements for 2003 and 2002.

This press release contains certain forward-looking statements of future expectations and non-Generally Accepted Accounting Principles (GAAP) financial measures. Actual results might differ materially from those projected in the forward looking statements because of factors such as those identified in reports the company has filed with the Securities and Exchange Commission. Earnings from ongoing operations should not be considered as an alternative to net income, determined in accordance with GAAP. Management uses earnings and earnings per share from ongoing operations as measures to evaluate operations of the company and believes that these non-GAAP financial measures also provide useful information to investors. Use of these measures facilitates the analysis of the company's ongoing performance as compared to its internal budgets and previously reported financial results. Other companies may use different measures to present financial performance.

Consolidated Edison, Inc. (NYSE: ED) is one of the nation's largest investor-owned energy companies, with $10 billion in annual revenues and approximately $21 billion in assets. The company provides a wide range of energy-related products and services to its customers through the following six subsidiaries: Consolidated Edison Company of New York, Inc., a regulated utility providing electric, gas, and steam service in New York City and Westchester County, New York; Orange and Rockland Utilities, Inc., a regulated utility serving customers in a 1,350 square mile area in southeastern New York state and adjacent sections of northern New Jersey and northeastern Pennsylvania; Con Edison Solutions, a retail energy services company; Con Edison Energy, a wholesale energy supply company; Con Edison Development, an infrastructure development company; and Con Edison Communications, a telecommunications infrastructure company and service provider.


                            Consolidated Edison, Inc.
                      CONSOLIDATED BALANCE SHEET (Condensed)
                                   (UNAUDITED)

                                                       As at
                                     December 31, 2003      December 31, 2002
                                                 (Millions of Dollars)
    ASSETS
    PLANT, AT ORIGINAL COST
        Utility plant - net                   $14,284                 $13,442
        Non-utility plant - net                   941                     710
    NET PLANT                                  15,225                  14,152

    CURRENT ASSETS
      Cash and temporary cash investments          67                     132
      Funds held for the redemption of
       long-term debt                              --                     275
      Accounts receivable - customers, less
       allowance for uncollectible accounts       790                     683
      Other receivables, less allowance for
       uncollectible accounts                     184                     169
      Inventories                                 283                     196
      Prepayments                                  98                      73
      Other current assets                        170                     178
    TOTAL CURRENT ASSETS                        1,592                   1,706

    INVESTMENTS                                   248                     235

    DEFERRED CHARGES, REGULATORY ASSETS
     AND NONCURRENT ASSETS
      Goodwill                                    406                     406
      Intangible assets - net                     111                      82
      Prepaid pension costs                     1,257                   1,024
      Regulatory assets                         1,861                   1,866
      Other deferred charges and noncurrent
       assets                                     266                     196
    TOTAL DEFERRED CHARGES, REGULATORY
     ASSETS AND NONCURRENT ASSETS               3,901                   3,574
    TOTAL ASSETS                              $20,966                 $19,667


                            Consolidated Edison, Inc.
                      CONSOLIDATED BALANCE SHEET (Condensed)
                                   (UNAUDITED)

                                                       As at
                                     December 31, 2003       December 31, 2002
                                                 (Millions of Dollars)
    CAPITALIZATION AND LIABILITIES
    CAPITALIZATION
      Common shareholders' equity              $6,423                  $5,921
      Preferred stock                             213                     213
      Long-term debt                            6,733                   6,166
    TOTAL CAPITALIZATION                       13,369                  12,300


    NONCURRENT LIABILITIES
      Provision for injuries and damages          194                     197
      Pension and benefits                        205                     206
      Superfund and other environmental
       costs                                      193                     143
      Other noncurrent liabilities                157                     122
    TOTAL NONCURRENT LIABILITIES                  749                     668

    CURRENT LIABILITIES
      Long-term debt due within one year          166                     473
      Notes payable                               159                     162
      Accounts payable                            905                     925
      Customer deposits                           228                     221
      Other current liabilities                   453                     494
    TOTAL CURRENT LIABILITIES                   1,911                   2,275

    DEFERRED CREDITS AND REGULATORY
     LIABILITIES
      Deferred income taxes and investment
       tax credits                              3,172                   2,788
      Regulatory liabilities and other
       deferred credits                         1,765                   1,636
    TOTAL DEFERRED CREDITS AND REGULATORY
     LIABILITIES                                4,937                   4,424
    TOTAL CAPITALIZATION AND LIABILITIES      $20,966                 $19,667


                          CONSOLIDATED EDISON, INC.
                        CONSOLIDATED INCOME STATEMENT
            FOR THE THREE MONTHS ENDED DECEMBER 31, 2003 AND 2002
                                 (Unaudited)

                                                2003                     2002
                                                    (Millions of Dollars)

    Operating revenues
         Electric                              $1,559                  $1,424
         Gas                                      362                     332
         Steam                                    107                     115
         Non-utility                              251                     186
           Total operating revenues             2,279                   2,057

    Operating expenses
         Purchased power                          936                     767
         Fuel                                      87                      94
         Gas purchased for resale                 190                     171
         Other operations                         266                     270
         Maintenance                               75                      90
         Impairment charges -
          telecommunications and
          other unregulated assets                159                       -
         Depreciation and amortization            136                     126
         Taxes, other than income tax             267                     277
         Income tax                                10                      46
           Total operating expenses             2,126                   1,841

    Operating income                              153                     216

    Other income (deductions)
         Investment income                          1                       1
         Allowance for equity funds
          used during construction                  5                       2
         Other income                               9                      31
         Other deductions                          (3)                     (1)
         Income tax                                 2                      (4)
           Total other income
            (deductions)                           14                      29

    Income before interest charges                167                     245

    Interest on long-term debt                    101                      90
    Other interest                                 20                      33
    Allowance for borrowed funds used
     during construction                           (4)                     (1)
         Net interest charges                     117                     122
    Income before preferred stock
     dividends                                     50                     123
    Preferred stock dividend
     requirements                                   3                       3
    Income before cumulative effect of
     changes in accounting principles             $47                    $120
    Cumulative effect of changes in
     accounting principles (net of
     income tax of $2 million in
     2003 and $1 million in 2002)                  $3                     $(2)
    Net income for common stock                   $50                    $118

    Earnings per common share - Basic
    Before cumulative effect of changes
     in accounting principles                   $0.19                   $0.56
    Cumulative effect of changes in
     accounting principles                      $0.02                   (0.01)
    After cumulative effect of changes
     in accounting principles                   $0.21                   $0.55

    Earnings per common share - Diluted
    Before cumulative effect of changes
     in accounting principles                   $0.19                   $0.56
    Cumulative effect of changes in
     accounting principles                      $0.02                   (0.01)
    After cumulative effect of changes
     in accounting principles                   $0.21                   $0.55

    Average number of shares
     outstanding - Basic (in Millions)          225.5                   213.7
    Average number of shares
     outstanding - Diluted (in Millions)        226.5                   214.8

    Consolidated Edison, Inc. utility sales
    Electric (thousands of
     kilowatthours)
         Total energy delivered in
          service areas                    14,218,825              14,405,405
    Gas (dekatherms)
         Firm sales and transportation     31,148,615              32,072,850
    Steam (thousands of pounds)             5,592,791               6,301,118


                          CONSOLIDATED EDISON, INC.
                        CONSOLIDATED INCOME STATEMENT
                         FOR THE TWELVE MONTHS ENDED
                          DECEMBER 31, 2003 AND 2002
                                 (Unaudited)

                                                 2003               2002
                                                    (Millions of Dollars)

    Operating revenues
         Electric                              $6,863                  $6,251
         Gas                                    1,492                   1,204
         Steam                                    537                     404
         Non-utility                              935                     643
           Total operating revenues             9,827                   8,502

    Operating expenses
         Purchased power                        3,926                   3,201
         Fuel                                     504                     289
         Gas purchased for resale                 847                     596
         Other operations                       1,134                     962
         Maintenance                              353                     387
         Impairment charges -
          telecommunications and
          other unregulated assets                159                       -
         Depreciation and amortization            529                     495
         Taxes, other than income tax           1,116                   1,114
         Income tax                               325                     398
           Total operating expenses             8,893                   7,442

    Operating income                              934                   1,060

    Other income (deductions)
         Investment income                          4                       2
         Allowance for equity funds used
          during construction                      15                      10
         Other income                              23                      48
         Other deductions                         (16)                    (20)
         Income tax                                10                      22
           Total other income (deductions)         36                      62

    Income before interest charges                970                   1,122

    Interest on long-term debt                    401                     386
    Other interest                                 45                      61
    Allowance for borrowed funds used
     during construction                          (12)                     (5)
         Net interest charges                     434                     442
    Income before preferred stock
     dividends                                    536                     680
    Preferred stock dividend
     requirements                                  11                      12
    Income before cumulative effect of
     changes in accounting principles             525                     668
    Cumulative effect of changes in
     accounting principles (net of
     income tax of $2 million in
     2003 and $15 million in 2002)                  3                     (22)
    Net income for common stock                  $528                    $646

    Earnings per common share - Basic
    Before cumulative effect of changes
     in accounting principles                   $2.37                   $3.14
    Cumulative effect of changes in
     accounting principles                      $0.02                  $(0.11)
    After cumulative effect of changes
     in accounting principles                   $2.39                   $3.03

    Earnings per common share - Diluted
    Before cumulative effect of changes
     in accounting principles                   $2.36                   $3.13
    Cumulative effect of changes in
     accounting principles                      $0.02                  $(0.11)
    After cumulative effect of changes
     in accounting principles                   $2.38                   $3.02


    Average number of shares outstanding
     - Basic (in Millions)                      220.9                   213.0
    Average number of shares outstanding
     - Diluted (in Millions)                    221.8                   214.0


    Consolidated Edison, Inc. utility sales
    Electric (thousands of
     kilowatthours)
         Total energy delivered in
          service areas                    59,347,469              59,520,658
    Gas (dekatherms)
         Firm sales and transportation    127,527,813             116,331,065
    Steam (thousands of pounds)            26,248,361              24,519,476

SOURCE Consolidated Edison, Inc.

Michael Clendenin of Consolidated Edison, Inc., +1-212-460-4111, or Media Relations, +1-212-460-4111 (24 hours)

http://www.coned.com

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