UGI CORP /PA/ [UGI] Filings

10-Q 1 ugi-20240630.htm 10-Q ugi-20240630

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2024


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

Commission file number 1-11071

UGI CORPORATION

(Exact name of registrant as specified in its charter)


Pennsylvania						23-2668356
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification No.)

500 North Gulph Road, King of Prussia, PA 19406

(Address of Principal Executive Offices) (Zip Code)

(610) 337-1000

(Registrant’s telephone number, including area code)

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 (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ý No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ý No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

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. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ý

At July 31, 2024, there were 214,688,629 shares of UGI Corporation Common Stock, without par value, outstanding.

Table of Contents

UGI CORPORATION AND SUBSIDIARIES

TABLE OF CONTENTS


			Page

Glossary of Terms and Abbreviations			1

Part I Financial Information

Item 1. Financial Statements (unaudited)

Condensed Consolidated Balance Sheets as of June 3 0 , 2024, September 30, 2023 and June 3 0 , 2023			5

Condensed Consolidated Statements of Income for the three and nine months ended June 3 0 , 2024 and 2023			6

Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended June 3 0 , 2024 and 2023			7

Condensed Consolidated Statements of Cash Flows for the nine months ended June 3 0 , 2024 and 2023			8

Condensed Consolidated Statements of Changes in Equity for the three and nine months ended June 3 0 , 2024 and 2023			9

Notes to Condensed Consolidated Financial Statements			10

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations			40

Item 3. Quantitative and Qualitative Disclosures About Market Risk			61

Item 4. Controls and Procedures			63

Part II Other Information

Item 1. Legal Proceedings			64

Item 1A. Risk Factors			64





Item 6. Exhibits			64

Signatures			67

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GLOSSARY OF TERMS AND ABBREVIATIONS

Terms and abbreviations used in this Form 10-Q are defined below:

UGI Corporation and Related Entities

AmeriGas Finance Corp. - A wholly owned subsidiary of AmeriGas Partners

AmeriGas OLP - AmeriGas Propane, L.P., the principal operating subsidiary of AmeriGas Partners

AmeriGas Partners - AmeriGas Partners, L.P., an indirect wholly owned subsidiary of UGI; also referred to, together with its consolidated subsidiaries, as the “Partnership”

AmeriGas Propane - Reportable segment comprising AmeriGas Propane, Inc. and its subsidiaries, including AmeriGas Partners and AmeriGas OLP

AmeriGas Propane, Inc. - A wholly owned second-tier subsidiary of UGI and the general partner of AmeriGas Partners

AvantiGas - AvantiGas Limited, an indirect wholly owned subsidiary of UGI International, LLC

Company - UGI and its consolidated subsidiaries collectively

DVEP - DVEP Investeringen B.V., an indirect wholly owned subsidiary of UGI International, LLC

Electric Utility - UGI Utilities’ regulated electric distribution utility

Energy Services - UGI Energy Services, LLC, a wholly owned subsidiary of Enterprises

Enterprises - UGI Enterprises, LLC, a wholly owned subsidiary of UGI

ESFC - Energy Services Funding Corporation, a wholly owned subsidiary of Energy Services

Flaga - Flaga GmbH, an indirect wholly owned subsidiary of UGI International, LLC

Gas Utility - UGI’s regulated natural gas businesses, inclusive of PA Gas Utility and WV Gas Utility

MBL Bioenergy - MBL Bioenergy, LLC

Midstream & Marketing - Reportable segment comprising Energy Services and subsidiaries including UGID

Mountaineer - Mountaineer Gas Company, a natural gas distribution company in West Virginia and a wholly owned subsidiary of Mountaintop Energy Holdings, LLC

Mountaintop Energy Holdings, LLC - Parent company of Mountaineer and wholly owned subsidiary of UGI

PA Gas Utility - UGI Utilities’ regulated natural gas distribution business, primarily located in Pennsylvania

Partnership - AmeriGas Partners and its consolidated subsidiaries, including AmeriGas OLP; also referred to as “AmeriGas Partners”

Pine Run - Pine Run Gathering, LLC

UGI - UGI Corporation or, collectively, UGI Corporation and its consolidated subsidiaries

UGI France - UGI France SAS (a Société par actions simplifiée), an indirect wholly owned subsidiary of UGI International, LLC

UGI International - Reportable segment principally comprising UGI’s foreign operations

UGI International, LLC - UGI International, LLC, a wholly owned subsidiary of Enterprises

UGI Utilities - UGI Utilities, Inc., a wholly owned subsidiary of UGI comprising PA Gas Utility and Electric Utility

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UGID - UGI Development Company, a wholly owned subsidiary of Energy Services

UniverGas - UniverGas Italia S.r.l, an indirect wholly owned subsidiary of UGI International, LLC

Utilities - Reportable segment comprising UGI Utilities and Mountaintop Energy Holdings, LLC

WV Gas Utility - Mountaineer’s regulated natural gas distribution business, located in West Virginia

Other Terms and Abbreviations

2023 Annual Report - UGI Annual Report on Form 10-K for the fiscal year ended September 30, 2023

2023 nine-month period - Nine months ended June 30, 2023

2023 three-month period - Three months ended June 30, 2023

2024 nine-month period - Nine months ended June 30, 2024

2024 three-month period - Three months ended June 30, 2024

2024 Purchase Contract - A forward stock purchase contract issued by UGI Corporation in May 2021, as a part of the issuance of Equity Units which obligated holders to purchase a number of shares of UGI Common Stock from the Company on June 1, 2024

2022 AmeriGas OLP Credit Agreement - Revolving credit agreement entered into by AmeriGas OLP on September 28, 2022, terminated concurrently with the execution of the AmeriGas Senior Secured Revolving Credit Facility

5.50% Senior Notes - An underwritten private offering of senior notes due May 2025, co-issued by AmeriGas Partners and AmeriGas Finance Corp

5.875% Senior Notes - An underwritten private offering of senior notes due August 2026, co-issued by AmeriGas Partners and AmeriGas Finance Corp

5.75% Senior Notes - An underwritten private offering of senior notes due May 2027, co-issued by AmeriGas Partners and AmeriGas Finance Corp

6.02% Senior Note - A private placement of $25 million principal amount of senior notes due November 2030, issued by UGI Utilities

6.10% Senior Note - A private placement of $150 million principal amount of senior notes due November 2033, issued by UGI Utilities

6.40% Senior Note - A private placement of $75 million principal amount of senior notes due November 2053, issued by UGI Utilities

9.375% Senior Notes - An underwritten private offering of senior notes due May 2028, co-issued by AmeriGas Partners and AmeriGas Finance Corp.

AmeriGas Senior Secured Revolving Credit Facility - Revolving credit agreement entered into by AmeriGas OLP on August 2, 2024 and scheduled to expire in August 2029

AOCI - Accumulated Other Comprehensive Income (Loss)

ASC - Accounting Standards Codification

ASC 606 - ASC 606, “Revenue from Contracts with Customers”

ASU - Accounting Standards Update

Bcf - Billions of cubic feet

COA - Consent Order and Agreement

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CODM - Chief Operating Decision Maker as defined in ASC 280, “Segment Reporting”

Common Stock - Shares of UGI common stock

Convertible Preferred Stock - Preferred stock of UGI titled 0.125% series A cumulative perpetual convertible preferred stock without par value and having a liquidation preference of $1,000 per share

DS - Default service

DSIC - Distribution System Improvement Charge

Energy Services Credit Agreement - Revolving credit agreement entered into by Energy Services on March 6, 2020, as amended, scheduled to expire in May 2028

Energy Services Term Loan Credit Agreement - Term loan credit agreement entered into by Energy Services in August 2019, as amended, with a final maturity of February 2030

Equity Unit - A corporate unit consisting of a 2024 Purchase Contract and 1/10th or 10% undivided interest in one share of Convertible Preferred Stock

Exchange Act - Securities Exchange Act of 1934, as amended

FASB - Financial Accounting Standards Board

FDIC - Federal Deposit Insurance Corporation

FERC - Federal Energy Regulatory Commission

Fiscal 2021 - The fiscal year ended September 30, 2021

Fiscal 2022 - The fiscal year ended September 30, 2022

Fiscal 2023 - The fiscal year ended September 30, 2023

Fiscal 2024 - The fiscal year ending September 30, 2024

Fiscal 2025 - The fiscal year ending September 30, 2025

Fiscal 2026 - The fiscal year ending September 30, 2026

GAAP - U.S. generally accepted accounting principles

Gwh - Millions of kilowatt hours

ICE - Intercontinental Exchange

IREP - Infrastructure Replacement and Expansion Plan

IRPA - Interest rate protection agreement

LNG - Liquefied natural gas

LPG - Liquefied petroleum gas

MDPSC - Maryland Public Service Commission

MGP - Manufactured gas plant

Mountaineer Credit Agreement - Revolving credit agreement entered into by Mountaineer on November 26, 2019, as amended, scheduled to expire in December 2025

NOAA - National Oceanic and Atmospheric Administration

NPNS - Normal purchase and normal sale

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NTSB - National Transportation Safety Board

NYDEC - New York State Department of Environmental Conservation

NYMEX - New York Mercantile Exchange

OSHA - Occupational Safety and Health Administration

PADEP - Pennsylvania Department of Environmental Protection

PAPUC - Pennsylvania Public Utility Commission

PGA - Purchased gas adjustment

PGC - Purchased gas costs

PRP - Potentially responsible party

Receivables Facility - A receivables purchase facility of Energy Services with an issuer of receivables-backed commercial paper

Retail core-market - Comprises firm residential, commercial and industrial customers to whom Utilities has a statutory obligation to provide service that purchase their natural gas from Utilities

RNG - Renewable natural gas

ROD - Record of Decision

SEC - U.S. Securities and Exchange Commission

U.K. - United Kingdom

U.S. - United States of America

UGI Corporation Senior Notes - Aggregate $700 million convertible senior notes entered into by UGI Corporation on June 11, 2024, with a final maturity date of June 2028

UGI Corporation Credit Facility Agreement - An amended and restated unsecured senior credit facilities agreement entered into by UGI Corporation on May 4, 2021, comprising (1) a $250 million term loan facility, (2) a $300 million term loan facility, (3) a $300 million delayed draw term loan facility, and (4) a $300 million revolving credit facility, a substantial portion of which is set to mature August 2025

UGI International 2023 Credit Agreement – A five-year unsecured senior facilities agreement entered into in March 2023, as amended, comprising a €300 million variable-rate term loan facility and a €500 million multicurrency revolving credit facility scheduled to expire in March 2028

UGI Utilities 2023 Credit Agreement - Revolving credit agreement entered into by UGI Utilities on November 9, 2023, as amended, scheduled to expire in November 2028

UGI Utilities Credit Agreement - Revolving credit agreement entered into by UGI Utilities on June 27, 2019, as amended, repaid in full and terminated concurrently with the execution of the UGI Utilities 2023 Credit Agreement

USD - U.S. dollar

VDP - Voluntary Departure Plan

WVPSC - Public Service Commission of West Virginia

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UGI CORPORATION AND SUBSIDIARIES

PART I FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

CONDENSED CONSOLIDATED BALANCE SHEETS

(unaudited)

(Millions of dollars)


	June 30, 2024		September 30, 2023		June 30, 2023
ASSETS
Current assets:
Cash and cash equivalents	$	183	$	241	$	260
Restricted cash	28		99		78
Accounts receivable (less allowances for doubtful accounts of $87, $71 and $87, respectively)	827		878		955
Accrued utility revenues	38		33		29

Inventories	379		433		410


Derivative instruments	39		75		31

Prepaid expenses and other current assets	222		286		272
Total current assets	1,716		2,045		2,035
Property, plant and equipment, (less accumulated depreciation of $4,861, $4,581 and $4,536, respectively)	8,571		8,547		8,394
Goodwill	3,030		3,027		3,060
Intangible assets, net	400		443		460
Utility regulatory assets	298		302		310
Derivative instruments	17		49		59


Other assets	1,034		988		925
Total assets	$	15,066	$	15,401	$	15,243
LIABILITIES AND EQUITY
Current liabilities:
Current maturities of long-term debt	$	286	$	57	$	56

Short-term borrowings	347		649		481
Accounts payable	462		613		541


Derivative instruments	32		60		120

Other current liabilities	759		895		885
Total current liabilities	1,886		2,274		2,083
Long-term debt	6,288		6,543		6,579

Deferred income taxes	1,019		928		905

Derivative instruments	18		27		47
Other noncurrent liabilities	1,165		1,235		1,256
Total liabilities	10,376		11,007		10,870
Commitments and contingencies (Note 9)
Equity:
UGI Corporation stockholders’ equity:
Preferred stock, without par value (authorized – 5,000,000 shares; issued – 0, 220,000 and 220,000 Series A shares, respectively)	—		167		167
UGI Common Stock, without par value (authorized — 450,000,000 shares; issued — 216,119,814, 210,906,052 and 210,882,552 shares, respectively)	1,675		1,503		1,500
Retained earnings	3,331		3,027		2,974
Accumulated other comprehensive loss	(269)		(256)		(222)
Treasury stock, at cost	(56)		(55)		(55)
Total UGI Corporation stockholders’ equity	4,681		4,386		4,364
Noncontrolling interests	9		8		9
Total equity	4,690		4,394		4,373
Total liabilities and equity	$	15,066	$	15,401	$	15,243

See accompanying notes to condensed consolidated financial statements.

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UGI CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(unaudited)

(Millions of dollars, except per share amounts)


	Three Months Ended June 30,				Nine Months Ended June 30,
	2024		2023		2024		2023
Revenues	$	1,380	$	1,659	$	5,968	$	7,524
Costs and expenses:
Cost of sales (excluding depreciation and amortization shown below)	639		1,104		2,871		6,358
Operating and administrative expenses	501		523		1,622		1,639


Depreciation and amortization	139		134		414		397

Impairment of goodwill	—		656		—		656
Impairment of held-for-sale assets	62		—		62		—
Loss on disposal of UGI International energy marketing business	1		—		29		215
Other operating income, net	(29)		(26)		(46)		(60)
	1,313		2,391		4,952		9,205
Operating income (loss)	67		(732)		1,016		(1,681)
(Loss) income from equity investees	(24)		1		(22)		2
Loss on extinguishments of debt	(7)		(9)		(7)		(9)

Other non-operating income (expense), net	5		1		3		(25)
Interest expense	(96)		(96)		(296)		(281)
(Loss) income before income taxes	(55)		(835)		694		(1,994)
Income tax benefit (expense)	7		46		(152)		361


Net (loss) income attributable to UGI Corporation	$	(48)	$	(789)	$	542	$	(1,633)
(Loss) earnings per common share attributable to UGI Corporation stockholders:
Basic	$	(0.23)	$	(3.76)	$	2.58	$	(7.78)
Diluted	$	(0.23)	$	(3.76)	$	2.52	$	(7.78)
Weighted-average common shares outstanding (thousands):
Basic	210,679		209,706		210,090		209,811
Diluted	210,679		209,706		215,218		209,811

See accompanying notes to condensed consolidated financial statements.

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UGI CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(unaudited)

(Millions of dollars)


	Three Months Ended June 30,				Nine Months Ended June 30,
	2024		2023		2024		2023
Net (loss) income including noncontrolling interests	$	(48)	$	(789)	$	542	$	(1,633)
Other comprehensive (loss) income:
Net gains on derivative instruments (net of tax of $(3), $(10), $(1) and $(5), respectively)	4		22		1		10
Reclassifications of net gains on derivative instruments (net of tax of $4, $4, $12 and $8, respectively)	(9)		(10)		(28)		(20)
Foreign currency adjustments (net of tax of $(2), $2, $3 and $31, respectively)	(10)		8		15		169
Benefit plans (net of tax of $0, $1, $0 and $1, respectively)	—		(1)		(1)		(1)
Other comprehensive (loss) income	(15)		19		(13)		158


Comprehensive (loss) income attributable to UGI Corporation	$	(63)	$	(770)	$	529	$	(1,475)

See accompanying notes to condensed consolidated financial statements.

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UGI CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

(Millions of dollars)


	Nine Months Ended June 30,
	2024		2023
CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss) including noncontrolling interests	$	542	$	(1,633)
Adjustments to reconcile net income (loss) including noncontrolling interests to net cash provided by operating activities:
Depreciation and amortization	414		397
Deferred income tax expense (benefit), net	83		(418)
Provision for uncollectible accounts	50		56

Changes in unrealized gains and losses on derivative instruments	12		1,866
Loss on disposal of UGI International energy marketing business	29		215
Impairment of held-for-sale assets	62		—
Impairment of assets	11		19
Impairment of goodwill	—		656
Loss on extinguishments of debt	7		9
Loss (income) from equity investees	22		(2)
Settlement of Energy Services interest rate swap, net of amortization	(17)		24

Other, net	(34)		20
Net change in:
Accounts receivable and accrued utility revenues	1		139
Income taxes receivable	—		91
Inventories	59		275
Utility deferred fuel and power costs, net of changes in unsettled derivatives	5		73
Accounts payable	(150)		(365)
Derivative instruments collateral deposits paid	(7)		(489)
Other current assets	41		(22)
Other current liabilities	(99)		(54)
Net cash provided by operating activities	1,031		857
CASH FLOWS FROM INVESTING ACTIVITIES
Expenditures for property, plant and equipment	(530)		(670)
Net proceeds (payments) from the disposition of businesses and assets	42		(3)
Acquisitions of businesses and assets, net of cash acquired	—		(9)
Investments in equity method investees	(66)		(101)
Settlements of net investment hedges	3		22

Net cash used by investing activities	(551)		(761)
CASH FLOWS FROM FINANCING ACTIVITIES
Dividends on UGI Common Stock	(238)		(230)

Issuances of long-term debt, net of discount and issuance costs	1,196		1,867
Repayments of long-term debt and finance leases, including redemption premiums	(1,249)		(1,953)
(Decrease) increase in short-term borrowings	(259)		49
Receivables Facility net (repayments) borrowings	(46)		45

Payments on Purchase Contracts	(12)		(12)
Issuances of UGI Common Stock	—		12
Repurchases of UGI Common Stock	—		(22)


Net cash used by financing activities	(608)		(244)
Effect of exchange rate changes on cash, cash equivalents and restricted cash	(1)		17
Cash, cash equivalents and restricted cash decrease	$	(129)	$	(131)
CASH, CASH EQUIVALENTS AND RESTRICTED CASH
Cash, cash equivalents and restricted cash at end of period	$	211	$	338
Cash, cash equivalents and restricted cash at beginning of period	340		469
Cash, cash equivalents and restricted cash decrease	$	(129)	$	(131)

See accompanying notes to condensed consolidated financial statements.

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UGI CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(unaudited)

(Millions of dollars, except per share amounts)


	Three Months Ended June 30,				Nine Months Ended June 30,
	2024		2023		2024		2023
Preferred stock, without par value
Balance, beginning of period	$	167	$	167	$	167	$	162

Cumulative effect of change in accounting	—		—		—		5
Settlement of Equity Units	(167)		—		(167)		—



Balance, end of period	$	—	$	167	$	—	$	167
Common stock, without par value
Balance, beginning of period	$	1,505	$	1,492	$	1,503	$	1,483
Common Stock issued in connection with employee and director plans, net of tax withheld	—		3		—		9
Equity-based compensation expense	4		5		6		14



Cumulative effect of change in accounting	—		—		—		(6)
Settlement of Equity Units	166		—		166		—

Balance, end of period	$	1,675	$	1,500	$	1,675	$	1,500
Retained earnings
Balance, beginning of period	$	3,460	$	3,842	$	3,027	$	4,841
Cumulative effect of change in accounting	—		—		—		1
Losses on common stock transactions in connection with employee and director plans	—		—		—		(5)
Net (loss) income attributable to UGI Corporation	(48)		(789)		542		(1,633)
Cash dividends on UGI Common Stock ($0.375, $0.375, $1.125 and $1.095, respectively)	(81)		(79)		(238)		(230)

Balance, end of period	$	3,331	$	2,974	$	3,331	$	2,974
Accumulated other comprehensive income (loss)
Balance, beginning of period	$	(254)	$	(241)	$	(256)	$	(380)
Net gains on derivative instruments	4		22		1		10
Reclassification of net gains on derivative instruments	(9)		(10)		(28)		(20)
Benefit plans	—		(1)		(1)		(1)
Foreign currency adjustments	(10)		8		15		169
Balance, end of period	$	(269)	$	(222)	$	(269)	$	(222)
Treasury stock
Balance, beginning of period	$	(56)	$	(55)	$	(55)	$	(40)
Common Stock issued in connection with employee and director plans, net of tax withheld	(1)		—		(1)		7
Repurchases of UGI Common Stock	—		—		—		(22)
Reacquired UGI Common Stock - employee and director plans	1		—		—		—

Balance, end of period	$	(56)	$	(55)	$	(56)	$	(55)
Total UGI stockholders’ equity	$	4,681	$	4,364	$	4,681	$	4,364
Noncontrolling interests
Balance, beginning of period	$	9	$	9	$	8	$	8


Other	—		—		1		1
Balance, end of period	$	9	$	9	$	9	$	9
Total equity	$	4,690	$	4,373	$	4,690	$	4,373

See accompanying notes to condensed consolidated financial statements.

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UGI CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

(unaudited)

(Currency in millions, except per share amounts and where indicated otherwise)

Note 1 — Nature of Operations

UGI is a holding company that, through subsidiaries and affiliates, distributes, stores, transports and markets energy products and related services in the U.S. and Europe. We own and operate (1) natural gas and electric distribution utilities; (2) energy marketing, midstream infrastructure, storage, natural gas gathering and processing, natural gas production, electricity generation and energy services businesses; and (3) retail propane and other LPG marketing and distribution businesses.

Our Utilities segment includes UGI Utilities and Mountaineer. PA Gas Utility serves customers in eastern and central Pennsylvania and in portions of one Maryland county, and Mountaineer serves customers in West Virginia. Electric Utility serves customers in portions of Luzerne and Wyoming counties in northeastern Pennsylvania. PA Gas Utility is subject to regulation by the PAPUC and FERC and, with respect to its customers in Maryland, the MDPSC. Mountaineer is subject to regulation by the WVPSC and FERC. Electric Utility is subject to regulation by the PAPUC and FERC.

Energy Services conducts, directly and through subsidiaries and affiliates, energy marketing, including RNG, midstream transmission, LNG storage, natural gas gathering and processing, natural gas and RNG production, electricity generation and energy services businesses primarily in the eastern region of the U.S., eastern Ohio, the panhandle of West Virginia and California. Energy Services and its subsidiaries’ storage, LNG and portions of its midstream transmission operations are subject to regulation by the FERC. UGID owns electricity generation facilities principally located in Pennsylvania. See Note 5 for additional information on pending disposition of UGID.

UGI International, LLC, through its subsidiaries and affiliates, primarily conducts an LPG distribution business throughout much of Europe. The LPG business is conducted principally through our subsidiaries, UGI France, Flaga, AvantiGas, and UniverGas. As of the end of the first quarter of Fiscal 2024, UGI International had exited substantially all of its European energy marketing business which primarily marketed natural gas and electricity to customers through third-party distribution systems in France, Belgium, the Netherlands, and the United Kingdom. See Note 5 for additional information regarding the UGI International energy marketing business.

We conduct a domestic propane marketing and distribution business through AmeriGas Partners. AmeriGas Partners conducts its propane marketing and distribution business through its principal operating subsidiary, AmeriGas OLP.

Note 2 — Summary of Significant Accounting Policies

The accompanying condensed consolidated financial statements and footnotes are unaudited and have been prepared in accordance with GAAP and the rules and regulations of the SEC. They include all adjustments that we consider necessary for a fair statement of the results for the interim periods presented. Such adjustments consisted only of normal recurring items unless otherwise disclosed. The September 30, 2023, Condensed Consolidated Balance Sheet was derived from audited financial statements but does not include all footnote disclosures from the annual financial statements.

These financial statements should be read in conjunction with the financial statements and related notes included in the Company’s 2023 Annual Report. Due to the seasonal nature of our businesses, the results of operations for interim periods are not necessarily indicative of the results to be expected for a full year.

Restricted Cash. Restricted cash principally represents those cash balances in our commodity futures brokerage accounts and certain other cash balances that are restricted from withdrawal. The following table provides a reconciliation of the total cash, cash equivalents and restricted cash reported on the Condensed Consolidated Balance Sheets to the corresponding amounts reported on the Condensed Consolidated Statements of Cash Flows.


	June 30, 2024		June 30, 2023
Cash and cash equivalents	$	183	$	260
Restricted cash	28		78
Cash, cash equivalents and restricted cash	$	211	$	338

Table of Contents

UGI CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements