UGI (UGI) - 2024 Q4 - Annual Results

Fiscal 2024 Key Highlights UGI Corporation reported a significant turnaround in fiscal 2024, achieving a GAAP net income of $269 million and adjusted diluted EPS of $3.06, alongside $75 million in expense reductions | Metric | Fiscal 2024 | Fiscal 2023 | | :--- | :--- | :--- | | GAAP Net Income | $269 million | $(1,502) million | | Adjusted Net Income | $658 million | $613 million | | GAAP Diluted EPS | $1.25 | $(7.16) | | Adjusted Diluted EPS | $3.06 | $2.84 | - Reportable segments' EBIT grew to $1,178 million from $1,158 million in the prior year[2] - Achieved a $75 million reduction in operating and administrative expenses compared to the prior year[2] - Deployed approximately $900 million of capital, with 80% allocated to regulated utilities and the Midstream and Marketing segment[2] - Maintained its 140-year consecutive dividend payment streak, with a 10-year compound annual growth rate of 6%[2] Management Commentary Management highlighted fiscal 2024 as a pivotal year with record natural gas EBIT and expense reductions, setting the stage for fiscal 2025's focus on business reset and value creation - Board Chair Mario Longhi highlighted that strong execution led to record EBIT from natural gas businesses, sustainable expense reductions, and improved liquidity[3] - President and CEO Robert Flexon stated that fiscal 2025 will focus on resetting the business to advance its value creation strategy by leveraging its asset base and driving operational excellence[3] Fiscal 2025 Outlook UGI Corporation projects an adjusted EPS range of $2.75 to $3.05 per diluted share for fiscal year 2025, assuming normal weather and current tax conditions - UGI issued an adjusted EPS guidance range of $2.75 - $3.05 per diluted share for fiscal year 2025[2][4] Segment Performance Analysis Fiscal 2024 segment performance varied, with Utilities, Midstream & Marketing, and UGI International showing EBIT growth, while AmeriGas Propane experienced a significant EBIT decline due to lower volumes Utilities The Utilities segment reported a 10% increase in Operating Income and EBIT, driven by higher base rates and customer growth, despite warmer weather | Metric | FY 2024 | FY 2023 | Change (%) | | :--- | :--- | :--- | :--- | | Revenues (Millions) | $1,598 | $1,854 | (14)% | | Total Margin (Millions) | $924 | $877 | 5% | | Operating Income (Millions) | $394 | $357 | 10% | | EBIT (Millions) | $400 | $365 | 10% | | Capital Expenditures (Millions) | $482 | $563 | (14)% | - Total margin increased by $47 million, primarily due to higher gas and electric base rates and continued customer growth[15] - Core market volumes declined slightly as the impact of weather (16% warmer than normal) was largely offset by customer growth[14][15] Midstream & Marketing The Midstream & Marketing segment's EBIT grew by 8% to $313 million, supported by an $18 million increase in total margin from capacity management gains | Metric | FY 2024 | FY 2023 | Change (%) | | :--- | :--- | :--- | :--- | | Revenues (Millions) | $1,369 | $1,847 | (26)% | | Total Margin (Millions) | $505 | $487 | 4% | | Operating Income (Millions) | $301 | $285 | 6% | | EBIT (Millions) | $313 | $291 | 8% | | Capital Expenditures (Millions) | $150 | $130 | 15% | - Total margin increased by $18 million, mainly from capacity management ($31 million), partially offset by lower margins from renewable energy marketing and natural gas gathering[17] - EBIT increased by $22 million, driven by higher operating income and a $5 million increase in income from equity method investments[18] UGI International UGI International delivered a strong performance with a 38% increase in EBIT to $323 million, driven by higher LPG unit margins and reduced operating expenses | Metric | FY 2024 | FY 2023 | Change (%) | | :--- | :--- | :--- | :--- | | Revenues (Millions) | $2,279 | $2,965 | (23)% | | Total Margin (Millions) | $978 | $920 | 6% | | Operating Income (Millions) | $311 | $215 | 45% | | EBIT (Millions) | $323 | $234 | 38% | | Capital Expenditures (Millions) | $87 | $129 | (33)% | - Total margin increased by $58 million, reflecting higher LPG unit margins and a $20 million positive impact from stronger foreign currencies[20] - Operating and administrative expenses decreased by $45 million, primarily due to exiting the non-core energy marketing business[20] AmeriGas Propane AmeriGas Propane faced a challenging year, with EBIT declining 47% to $142 million due to a 10% decrease in retail gallons sold from customer attrition and warmer weather | Metric | FY 2024 | FY 2023 | Change (%) | | :--- | :--- | :--- | :--- | | Revenues (Millions) | $2,271 | $2,581 | (12)% | | Total Margin (Millions) | $1,212 | $1,331 | (9)% | | Operating Income / EBIT (Millions) | $142 | $268 | (47)% | | Retail Gallons Sold (Millions) | 737 | 823 | (10)% | | Capital Expenditures (Millions) | $86 | $134 | (36)% | - Retail gallons sold decreased by 10% (86 million gallons) due to customer attrition and warmer weather[21] - Operating income and EBIT decreased by $126 million, driven by lower total margin and a $23 million decrease in other income from lower gains on asset sales[21] Consolidated Financial Results UGI Corporation reported total revenues of $7.21 billion for fiscal 2024, with a net income of $269 million and diluted EPS of $1.25, marking a significant recovery from the prior year's loss | Metric (Twelve Months Ended Sep 30) | 2024 | 2023 | | :--- | :--- | :--- | | Total Revenues (Millions) | $7,210 | $8,928 | | Total Reportable Segments EBIT (Millions) | $1,178 | $1,158 | | Total (loss) earnings before interest expense and income taxes (Millions) | $734 | $(1,458) | | Net (loss) income attributable to UGI Corporation (Millions) | $269 | $(1,502) | | Diluted (Loss) earnings per share | $1.25 | $(7.16) | Reconciliation of GAAP to Non-GAAP Measures UGI provides adjusted net income and diluted EPS to clarify ongoing performance, with fiscal 2024 GAAP net income of $269 million adjusted to $658 million | Reconciliation (FY 2024, in millions) | Amount | | :--- | :--- | | Net income attributable to UGI (GAAP) | $269 | | Net (gains) on commodity derivative instruments | $(60) | | Loss associated with impairment of AmeriGas Propane goodwill | $192 | | Costs associated with exit of UGI Int'l energy marketing | $69 | | Loss on disposal of UGID | $55 | | Restructuring costs | $56 | | Other adjustments | $77 | | Total Adjustments | $389 | | Adjusted net income attributable to UGI (Non-GAAP) | $658 | | EPS Reconciliation (FY 2024) | Amount | | :--- | :--- | | Diluted EPS (GAAP) | $1.25 | | Total adjustments per share | $1.81 | | Adjusted Diluted EPS (Non-GAAP) | $3.06 |