Document
false0000884614 0000884614 2020-03-26 2020-03-26


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 
 
FORM 8-K
 
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): March 26, 2020
  
UGI Corporation
(Exact Name of Registrant as Specified in Charter)
 
 
 
 
Pennsylvania
1-11071
23-2668356
(State or Other Jurisdiction
of Incorporation)
(Commission
File Number)
(I.R.S. Employer
Identification No.)
460 North Gulph Road, King of Prussia, PA 19406
(Address of Principal Executive Offices) (Zip Code)
Registrant’s Telephone Number, Including Area Code: 610 337-7000
Not Applicable
Former Name or Former Address, if Changed Since Last Report
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
☐
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:
Title of each class:
Trading Symbol(s):
Name of each exchange on which registered:
Common Stock, without par value
UGI
New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b of this chapter).
Emerging growth company
☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  ☐




Item 7.01 Regulation FD Disclosure.

On March 26, 2020, UGI Corporation (the “Company”) issued a press release and posted an investor presentation on its website providing an update regarding its business and financial position, as well as certain impacts of the COVID-19 virus on the operations of the Company and its subsidiaries. The press release and investor presentation are included as Exhibits 99.1 and 99.2, respectively, to this Current Report on Form 8-K and are incorporated into this Item 7.01 by reference.

The information set forth in this Item 7.01 and the attached Exhibits 99.1 and 99.2 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits. The following exhibits are being furnished herewith:
 
99.1
99.2
101
Cover Page Interactive Data File (embedded within the Inline XBRL document).
104
The cover page from this Current Report, formatted as Inline XBRL.











SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
 
 
 
UGI Corporation
 
 
 
March 26, 2020
By:
/s/ Jessica A. Milner
 
Name:
Jessica A. Milner
 
Title:
Assistant Secretary




 a32620pressrelease
Press Release UGI Announces Recent Transactions that Increase Short-Term Liquidity by Over $200 million VALLEY FORGE, Pa., March 26, 2020 – On March 20, 2020, UGI Corporation (NYSE:UGI) announced that its subsidiary, UGI Utilities, Inc., entered into a Note Purchase Agreement for a $150 million private placement priced at 3.12% with a maturity date of April 2050. Funding is scheduled for April 16, 2020, and proceeds from the Note Purchase Agreement will be used primarily to reduce short- term borrowings. In addition, on March 6, 2020, UGI’s subsidiary, UGI Energy Services, LLC, increased its Senior Secured Revolving Credit Facility by $60 million to $260 million in total and extended the maturity of the facility to March 2025. Together, the transactions increase UGI’s short- term liquidity by approximately $210 million. “UGI’s philosophy has always been to practice sound balance sheet management and maintain strong liquidity. The completion of these two deals further strengthens our liquidity position at a crucial time,” said John L. Walsh, President and Chief Executive Officer of UGI. “UGI Corporation’s balance sheet is positioned well to handle the challenges we are all facing as a result of COVID-19. Our total available liquidity balance as of February 29, 2020, which was prior to the notes private placement and upsize of our revolver, totaled $1.15 billion. Both the Natural Gas and Global LPG businesses have access to capital as available financing capacity is spread fairly evenly across our businesses. Typically, as we exit the winter heating season our working capital requirements subside and our cash generation increases. A strong balance sheet supports UGI’s long-term commitments to shareholders and ensures that we can serve our customers in challenging times. Lastly, we continue to refine our views on the impact of both warm weather and COVID-19 on our second quarter and fiscal 2020 results. We intend to update guidance as more information becomes available.” About UGI Corporation UGI Corporation is a distributor and marketer of energy products and services. Through subsidiaries, UGI operates natural gas and electric utilities in Pennsylvania, distributes LPG both domestically (through AmeriGas) and internationally (through UGI International), manages midstream energy assets in Pennsylvania, Ohio, and West Virginia and electric generation assets in Pennsylvania, and engages in energy marketing in eleven states, the District of Columbia and internationally in France, Belgium, the Netherlands and the UK. Comprehensive information about UGI Corporation is available on the Internet at https://www.ugicorp.com. Investor Relations Brendan Heck, 610-337-1000 ext. 6608 Alanna Zahora 610-337-1000 ext. 1004 Shelly Oates, 610-337-1000 ext. 3202

 
marchndrvfinal
Fiscal 2020 March

 
About This Presentation This presentation contains statements, estimates and projections which are forward-looking statements (as defined in Section 21E of the Securities and Exchange Act of 1934, as amended). Management believes that these are reasonable as of today’s date only. Actual results may differ significantly because of risks and uncertainties that are difficult to predict and many of which are beyond management’s control. You should read UGI’s Annual Report on Form 10-K for a more extensive list of factors that could affect results. Among them are adverse weather conditions and the seasonal nature of our business, cost volatility and availability of all energy products, including propane, natural gas, electricity and fuel oil, increased customer conservation measures, the impact of pending and future legal proceedings, liability for UGI CORPORATION uninsured claims and for claims in excess of insurance coverage, domestic and international political, 2 regulatory and economic conditions in the United States and in foreign countries, including the current conflicts in the Middle East and the potential withdrawal of the United Kingdom from the European Union, and foreign currency exchange rate fluctuations (particularly the euro), the timing of development of Marcellus Shale gas production, the availability, timing and success of our acquisitions, commercial initiatives and investments to grow our business, our ability to successfully integrate acquired businesses and achieve anticipated synergies, including certain integration risks relating to the acquisition of CMG, and the interruption, disruption, failure, malfunction, or breach of our information technology systems, including due to cyber-attack, the inability to complete pending or future energy infrastructure projects, and our ability to achieve the operational benefits and cost efficiencies expected from the completion of pending and future transformation initiatives at our business units. This presentation also includes forward- looking statements addressing the anticipated impact of COVID-19 on our business, operations and financial condition. UGI undertakes no obligation to release revisions to its forward-looking statements to reflect events or circumstances occurring after today.

 
Use of Non-GAAP Measures In this presentation, Management uses UGI Corporation Free Cash Flow, a non-GAAP financial measure. This financial measure is not in accordance with, or an alternative to, GAAP and should be considered in addition to, and not as a substitute for, the comparable GAAP measures. Management believes the presentation of these non-GAAP financial measures provides useful information to investors to more effectively evaluate cash flow generation of the Company’s businesses. A reconciliation of this non-GAAP financial measure to the most directly comparable financial measure calculated and presented in accordance with GAAP is presented in the UGI CORPORATION Appendix of this presentation. 3

 
Impact of COVID-19 • Implemented a COVID-19 Response Plan that assures the following: • Businesses are staffed for continuous supply of energy to our customers and for emergency calls • Employees take all necessary measures to keep themselves and our customers safe • Customer service centers are available to respond to customer calls • UGI’s business is considered an essential service • Minimal disruptions to operations domestically and in Europe, including France and Italy UGI CORPORATION 4 • No anticipated supply chain issues • Expect some volume challenges, particularly from “non-essential” Commercial and Industrial customers • Continue to refine the impact of both warm weather and COVID-19 on Q2 and FY2020 earnings; intend to update guidance as more information becomes available

 
Strong Balance Sheet and Liquidity • Increased short-term liquidity by $210 million • March 19th – UGI Utilities completed a Note Purchase Agreement for a $150 million private placement priced at 3.12% with a maturity date of April 2050 • Proceeds will be used primarily to reduce short-term borrowings • March 6th – UGI Energy Services increased its Senior Secured Revolving Credit Facility by $60 million and extended the maturity of the facility to March 2025 • Total liquidity as of 2/29/20 $1.15 billion UGI CORPORATION 5 • Natural Gas and Global LPG businesses have access to capital as available financing capacity is evenly distributed • Low commodity prices experienced in fiscal Q1 and Q2 • Lower working capital requirements in fiscal Q3 and Q4 • No near-term senior note or term loan maturities

 
Track Record of Generating Strong Cash Flow in Varying Economic Cycles Cash Provided by Operating Activities $1,200.0 The Great Recession – worst $1,000.0 downturn since the Great Depression $800.0 UGI CORPORATION 6 $600.0 $'s $'s inmillions $400.0 $200.0 $- 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Stable cash flow during the Great Recession

 
History of Strong Free Cash Flow in Varying Economic Cycles UGI Corporation Free Cash Flow1 $500.0 The Great $400.0 Recession – worst downturn since the Great Depression UGI CORPORATION $300.0 7 $'s $'s inmillions $200.0 $100.0 $- 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 (1) UGI Free Cash Flow = Cash Provided by Operations less Capital Expenditures and less Distributions on AmeriGas Partners Publicly Held Units. Free cash flow is a non-GAAP measure. Please see appendix for reconciliation.

 
Capex Update • Evaluating capex impact of COVID-19 across our businesses • No longer expect to spend $850 million; plan to reduce capex by a minimum of $120 million • Will communicate updated capex guidance as more information emerges • UGI Utilities – active dialogue with PA PUC; limiting direct interaction with customers; reprioritization of work UGI CORPORATION 8 • UGI Energy Services – construction to slow down on build-out of LNG storage and vaporization facility in Bethlehem, PA and expect lower capex on expansion projects on Texas Creek and Marshlands systems • Global LPG – continue to make progress on LPG business transformation initiatives; evaluating impact of COVID-19

 
Summary • UGI’s business is considered an essential service • UGI is well-prepared financially to deal with COVID-19 downturn • Strong Balance Sheet • $1.15 billion in total available liquidity UGI CORPORATION • Expect some volume challenges particularly from “non-essential” Commercial and 9 Industrial customers • History of strong operating and free cash flow has allowed UGI to weather market disruptions well • COVID-19 will impact FY 2020 Capex guidance of $850 million by a minimum of $120 million • Evaluating impact and plan to communicate updates as more information emerges

 
Appendix

 
UGI Corporation Free Cash Flow ($ in millions) Year Ended September 30, 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Net Cash Provided By Operating Activities $ 132.7 $ 203.5 $ 247.5 $ 249.1 $ 260.7 $ 437.7 $ 279.4 $ 456.2 $ 464.4 $ 665.0 Less: Expenditures for property, plant, and equipment (71.0) (78.0) (94.7) (100.9) (133.7) (158.4) (191.7) (223.1) (232.1) (301.8) Free Cash Flow Before Distributions on AmeriGas Publicly Held Common Units 61.7 125.5 152.8 148.2 127.0 279.3 87.7 233.1 232.3 363.2 Less: Distributions on AmeriGas Partners Publicly Held Common Units (39.1) (44.3) (53.5) (56.4) (62.4) (66.6) (73.6) (85.0) (80.9) (159.1) Free Cash Flow $ 22.6 $ 81.2 $ 99.3 $ 91.8 $ 64.6 $ 212.7 $ 14.1 $ 148.1 $ 151.4 $ 204.1 UGI CORPORATION 11 Year Ended September 30, 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Net Cash Provided By Operating Activities $ 598.8 $ 554.7 $ 707.7 $ 801.5 $ 1,005.4 $ 1,163.8 $ 969.7 $ 964.4 $ 1,085.3 $ 1,078.1 Less: Expenditures for property, plant, and equipment (347.3) (360.7) (339.4) (486.0) (456.8) (490.6) (563.8) (638.9) (574.9) (704.6) Free Cash Flow Before Distributions on AmeriGas Publicly Held Common Units 251.5 194.0 368.3 315.5 548.6 673.2 405.9 325.5 510.4 373.5 Less: Distributions on AmeriGas Partners Publicly Held Common Units (89.1) (93.7) (181.7) (226.5) (237.7) (248.9) (257.3) (261.6) (263.0) (263.1) Free Cash Flow $ 162.4 $ 100.3 $ 186.6 $ 89.0 $ 310.9 $ 424.3 $ 148.6 $ 63.9 $ 247.4 $ 110.4

 
v3.20.1
Cover Page
Mar. 26, 2020
Cover page.  
Document Type 8-K
Document Period End Date Mar. 26, 2020
Entity Registrant Name UGI Corp
Entity Central Index Key 0000884614
Amendment Flag false
Entity Incorporation, State or Country Code PA
Entity File Number 1-11071
Entity Tax Identification Number 23-2668356
Entity Address, Address Line One 460 North Gulph Road
Entity Address, City or Town King of Prussia
Entity Address, State or Province PA
Entity Address, Postal Zip Code 19406
City Area Code 610
Local Phone Number 337-7000
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Title of 12(b) Security Common Stock, without par value
Trading Symbol UGI
Security Exchange Name NYSE
Entity Emerging Growth Company false