EXHIBIT 99
Contact: Robert W. Krick For Release: January 28, 2004
610-337-1000, ext. 3141 Immediate
UGI REPORTS HIGHER FIRST QUARTER RESULTS
VALLEY FORGE, Pa., January 28 - UGI Corporation (NYSE: UGI) reported that its
net income for the first quarter of fiscal 2004 ended December 31, 2003 rose to
$38.8 million, or $0.88 per diluted share, compared to $36.7 million, or $0.86
per diluted share for the first quarter of fiscal 2003. Average fully diluted
shares outstanding were 3.2% higher in the recent quarter.
Lon R. Greenberg, chairman, president and chief executive officer of UGI, said,
"I am pleased that we were able to report higher earnings notwithstanding the
adverse effects of the warmer than normal weather experienced by all of our
business units. The beneficial effects of our acquisitions in gas marketing,
electric generation and domestic propane distribution, along with improvements
in our international propane results more than offset the weather-induced
decline in results from our utility businesses."
UGI's net income from its domestic propane distributor, AmeriGas Partners L. P.
(NYSE:APU), rose slightly to $12.9 million in the fiscal 2004 quarter compared
to $12.7 million last year. Partnership earnings before interest expense, income
taxes, depreciation and amortization (EBITDA) were $84.6 million in the first
fiscal quarter of 2004 compared to $81.4 million a year ago. For the three
months ended December 31, 2003, retail volumes sold declined to 304.5 million
gallons from 324.2 million gallons sold in the prior-year period. Weather was
7.4% warmer than normal during the recent quarter compared to weather that was
approximately 1% colder than normal in the prior-year period, according to the
National Oceanic and Atmospheric Administration. Retail volumes sold declined as
a result of warmer weather and, with respect to commercial and industrial
customers, continuing economic weakness, partially offset by volume growth from
recent acquisitions. Operating and administrative expenses rose modestly during
the quarter mainly reflecting the impact of the Active Propane and Horizon
Propane acquisitions in 2003 partially offset by the beneficial effects of the
management realignment completed in late fiscal 2003.
At UGI Utilities' Gas Utility, net income declined to $15.2 million for the
quarter ended December 31, 2003 compared to $17.6 million for the fiscal 2003
quarter. Weather in the service territory was 3.8% warmer than normal for the
recent quarter versus 6.4% colder than normal in the prior-year quarter.
Operating income declined as a result of lower margin from weather-induced lower
sales to retail core-market customers and lower margin from interruptible
customers as well as higher operating and administrative expenses mainly
reflecting higher stock-based incentive compensation expense.
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UGI REPORTS HIGHER FIRST QUARTER RESULTS PAGE 2
Net income from UGI Utilities' Electric Utility declined to $2.4 million in the
recently-completed quarter from $2.9 million in the prior-year quarter primarily
because of higher purchased power costs and higher operating and administrative
expenses reflecting greater distribution system and stock-based incentive
compensation expense. Weather in the service territory was 1.7% warmer than
normal in the recent quarter compared to 9.5% colder than normal last year.
Net income from Energy Services, which now includes electricity generation
operations, increased to $3.7 million in the fiscal 2004 first quarter from $2.3
million in the comparable 2003 quarter reflecting principally the beneficial
effects of the acquisitions of the northeastern U.S. gas marketing business of
TXU Energy in March of 2003 and the additional 4.9% interest in the Conemaugh
electricity generating station, partially offset by lower average unit margins
in gas marketing principally due to the effects of seasonality of margin
realization.
International Propane net income increased to $4.8 million in the recent quarter
from $1.2 million in the first quarter of fiscal 2003. International Propane
operating income rose to $1.8 million from $0.3 million principally reflecting
improved results of FLAGA, UGI's wholly-owned Austrian based propane
distributor. The stronger euro enhanced the results of higher euro-based margins
and lower euro-based expenses at FLAGA. The increase in the three-month period
earnings from our equity investees is primarily the result of higher income from
favorable euro-based results at Antargaz, the French propane marketer of which
UGI owns nearly 20%, and the translation effects of the stronger euro. As
previously announced, a unit of UGI has proposed to purchase the remaining
outstanding 80.5% ownership interests in AGZ Holding, the parent company of
Antargaz. Antargaz is one of the largest retail distributors of propane and
butane in France.
Separately, UGI announced that Robert J. Chaney, president and chief executive
officer of UGI Utilities, Inc., will retire during the summer of 2004 after more
than 40 years of service. "Bob has set the standard for loyalty, diligence, hard
work and excellence for all of us at UGI," said Greenberg. "Under his leadership
since 1999, Utilities has not only reached record-breaking levels of
performance, but also external recognition of our outstanding customer service.
He truly will be missed," concluded Greenberg. The company currently is
recruiting for a successor.
UGI is a holding company with propane marketing, utility and energy
marketing subsidiaries. Through subsidiaries, UGI owns 48% of AmeriGas
Partners, L. P. (NYSE: APU), the nation's largest retail propane marketer.
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UGI REPORTS HIGHER FIRST QUARTER RESULTS PAGE 3
UGI invites interested parties to listen to the live webcast of management's
teleconference with financial analysts about first quarter fiscal year 2004
financial results and current activities on Wednesday, January 28, 2004, at 4:00
PM Eastern time. The teleconference is available online live, in audio format,
at http://www.shareholder.com/ugi/medialist.cfm and will be archived through
February 27, 2004. A telephonic replay of the call can be accessed approximately
two hours after the completion of the call at 888-203-1112 and International
access at 719-457-0820, pass code 217168. The telephone replay is available
through midnight Eastern Time February 1, 2004.
The financial tables appended to this news release can be viewed directly at
HTTP://WWW.SHAREHOLDER.COM/UGI/1Q04FINANCIALTABLE.PDF.
This press release contains certain forward-looking statements which management
believes to be 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. Among them are adverse
weather conditions, price volatility and availability of all energy products,
including propane, natural gas, electricity and fuel oil, domestic and
international economic and political conditions, currency exchange rates and the
timing of the completion of our proposed acquisition of the remaining interests
in Antargaz. UGI undertakes no obligation to release revisions to its
forward-looking statements to reflect events or circumstances occurring after
today.
Comprehensive information about UGI Corporation is available on the Internet at
HTTP://WWW.UGICORP.COM.
C-03 ### 1/28/04
UGI CORPORATION
REPORT OF EARNINGS
(Millions, except per share)
(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------ ------------
2003 2002 2003 2002
---- ---- ---- ----
Revenues:
AmeriGas Propane $ 460.2 $ 445.0 $ 1,643.6 $ 1,381.5
Gas Utility 149.3 145.1 544.1 428.3
Electric Utility 21.4 21.5 88.7 84.7
Energy Services (a) 232.9 104.9 796.0 356.1
International Propane 15.8 14.3 56.0 47.3
Corporate & Other 14.1 9.1 51.5 36.3
---------- ---------- ---------- ----------
Total revenues $ 893.7 $ 739.9 $ 3,179.9 $ 2,334.2
========== ========== ========== ==========
Operating income (loss):
AmeriGas Propane $ 65.6 $ 64.2 $ 165.9 $ 166.8
Gas Utility 29.4 33.5 92.0 85.7
Electric Utility 4.5 5.6 19.2 15.0
Energy Services (a) 6.3 3.9 21.6 13.9
International Propane 1.8 0.3 2.2 2.4
Corporate & Other 0.7 (0.1) 2.3 2.4
---------- ---------- ---------- ----------
Total operating income 108.3 107.4 303.2
286.2
Income from equity investees 4.2 1.9 7.6 6.6
Loss on extinguishment of debt -- -- (3.0) --
Interest expense:
AmeriGas Propane (21.1) (22.7) (85.5) (87.8)
Gas Utility (4.1) (3.7) (15.8) (14.3)
Electric Utility (0.5) (0.6) (2.2) (2.4)
International Propane (0.9) (1.1) (3.9) (4.1)
Corporate and Other, net (0.1) (0.1) (0.3) (0.5)
---------- ---------- ---------- ----------
Total interest expense (26.7) (28.2) (107.7) (109.1)
Minority interests in AmeriGas Partners (22.7) (20.5) (36.8) (39.4)
---------- ---------- ---------- ----------
Income before income taxes and subsidiary
preferred stock dividends 63.1 60.6 163.3 144.3
Income tax expense (24.3) (23.5) (61.5) (54.6)
Dividends on UGI Utilities preferred shares
subject to mandatory redemption -- (0.4) (0.8) (1.6)
---------- ---------- ---------- ----------
Net income $ 38.8 $ 36.7 $ 101.0 $ 88.1
========== ========== ========== ==========
Earnings per share (b):
Basic $ 0.91 $ 0.88 $ 2.38 $ 2.12
========== ========== ========== ==========
Diluted $ 0.88 $ 0.86 $ 2.32 $ 2.09
========== ========== ========== ==========
Average common shares outstanding (b):
Basic 42.839 41.688 42.509 41.475
========== ========== ========== ==========
Diluted 43.947 42.593 43.576 42.159
========== ========== ========== ==========
Supplemental information:
Net income (loss):
AmeriGas Propane (c) $ 12.9 $ 12.7 $ 23.4 $ 24.1
Gas Utility 15.2 17.6 45.6 41.5
Electric Utility 2.4 2.9 10.1 7.3
Energy Services (a) 3.7 2.3 12.6 8.1
International Propane 4.8 1.2 7.2 4.7
Corporate & Other (0.2) -- 2.1 2.4
---------- ---------- ---------- ----------
Total net income $ 38.8 $ 36.7 $ 101.0 $ 88.1
========== ========== ========== ==========
(a) Effective October 1, 2003, the Energy Services segment includes the
operating results of Energy Services' gas marketing business as well as UGID's
electricity generation business. Energy Services' segment presentation for the
prior year has been restated to conform to the current year presentation.
(b) Earnings per share and average common shares outstanding for all periods
presented reflect the effects of the Company's 3-for-2 common stock split
distributed April 1, 2003 to shareholders of record on February 28, 2003.
(c) Amounts are net of minority interests in AmeriGas Partners, L.P.
UGI UTILITIES, INC.
(a wholly owned subsidiary of UGI Corporation)
REPORT OF EARNINGS
(Thousands of Dollars)
(Unaudited)
Three Months Ended Twelve Months Ended
December 31, December 31,
------------ ------------
2003 2002 2003 2002
---- ---- ---- ----
Revenues $170,684 $168,351 $639,091 $517,422
======== ======== ======== ========
Income before income taxes $ 29,346 $ 34,495 $ 95,063 $ 84,814
======== ======== ======== ========
Net income $ 17,508 $ 20,714 $ 57,466 $ 50,764
Dividends on preferred shares subject to
mandatory redemption (a) -- 388 775 1,550
-------- -------- -------- --------
Net income after dividends on preferred shares
subject to mandatory redemption $ 17,508 $ 20,326 $ 56,691 $ 49,214
======== ======== ======== ========
(a) Beginning July 1, 2003, the Company accounts for preferred shares subject to
mandatory redemption in accordance with SFAS No. 150, "Accounting for Certain
Financial Instruments with Characteristics of Both Liabilities and Equity." For
periods presented after June 30, 2003, dividends paid on these shares are
classified as a component of interest expense.