Contact: 610-337-1000 For Release: July 28, 2004
Robert W. Krick, ext. 3141 Immediate
Brenda A. Blake, ext. 3202
UGI REPORTS HIGHER THIRD QUARTER EARNINGS, RAISES GUIDANCE
VALLEY FORGE, Pa., July 28 - UGI Corporation (NYSE:UGI) reported that its net
income for the third quarter of fiscal 2004 ended June 30, 2004 was $8.3
million, or $0.16 per diluted share, compared to a loss of $2.0 million, or
$0.05 per diluted share for the third quarter of fiscal 2003. Results for the
recent quarter include, for the first time, the consolidated operating results
of AGZ Holding and its French propane distribution company, Antargaz. Average
diluted shares outstanding were approximately 22% higher for the recent quarter
reflecting, among other things, a common share offering in March 2004, the
proceeds of which funded a portion of the purchase price of AGZ Holding.
Lon R. Greenberg, chairman, president and chief executive officer of UGI, said,
"Despite warmer weather across our service territories, all of our operating
units posted improved results for the quarter. The transition of Antargaz is
going well and we are particularly pleased with the results achieved by Antargaz
this quarter. We remain focused on executing our strategies in each of our
businesses while we pursue more opportunities to invest wisely for our
shareholders."
UGI's domestic propane distributor, AmeriGas Propane, reported a seasonal net
loss of $7.0 million in the most recently completed quarter compared to a loss
of $8.3 million in the 2003 quarter. For the three months ended June 30, 2004,
retail volumes sold were 175.2 million gallons compared to 182.4 million gallons
sold in the prior-year period. Nationally, weather was 8% warmer than normal in
the 2004 period compared to weather that was essentially normal in the
prior-year period according to the National Oceanic and Atmospheric
Administration. Earnings before interest expense, income taxes, depreciation and
amortization (EBITDA) of AmeriGas Partners, L. P. (NYSE:APU) were $16.1 million
in the fiscal 2004 period compared to $12.6 million a year ago.
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UGI REPORTS HIGHER THIRD QUARTER EARNINGS, RAISES GUIDANCE PAGE 2
At UGI Utilities' Gas Utility, net income rose to $1.3 million in the third
quarter of fiscal 2004 from $1.0 million last year. Weather in the service
territory was 18.7% warmer than normal and significantly warmer than last year's
16.3% colder than normal weather. "Total margin declined for the quarter as
higher volumes transported for delivery service customers and the beneficial
effects of retail core-market customer growth did not offset warm
weather-induced lower volumes to our core market," said Greenberg. Operating and
administrative expenses were lower due in large part to the absence of costs
related to settling an environmental claim and lower long-term compensation
accruals.
Net income for the quarter from Electric Utility was $3.2 million, up from $2.5
million a year ago, mainly as a result of higher kilowatt-hour sales, due in
large part to greater air conditioning-related sales partially offset by the
adverse effects of warmer spring weather on heating-related sales.
Energy Services net income for the quarter increased to $6.0 million from $2.4
million primarily due to the additional 4.9% interest in the Conemaugh
electricity generating station purchased in late June 2003 and a 6.5% increase
in natural gas volumes sold by GASMARK(R). In addition to the higher natural gas
volumes sold, results include higher average unit margins in gas marketing
principally due to the previously reported effects of the seasonality of margin
realization.
International Propane net income increased to $4.1 million in the 2004 quarter
from a $0.4 million loss in the 2003 quarter as a result of the consolidation of
all of Antargaz' operations beginning April 1, 2004 which arose from the
purchase of the remaining 80.5% ownership interest in its parent. Antargaz sold
approximately 64 million gallons of liquefied petroleum gases in the most recent
quarter, up from 57 million gallons in last year's quarter. Weather in France
was 8% warmer than normal during the 2004 quarter compared to 19% warmer than
normal in the 2003 quarter.
Revenues for the quarter for UGI increased to $823.4 million from $623.1 million
mainly as a result of the consolidation of Antargaz and higher commodity prices.
Separately, UGI raised its earnings guidance $0.05 per share for the fiscal year
ending September 30, 2004 to $2.15 to $2.25 per diluted share. The range
includes a projected loss of approximately $0.25 per share from both the
dilutive effects of 7.8 million additional shares outstanding related to the
purchase of Antargaz and the estimated seasonal loss from Antargaz for the
summer months of July through September.
UGI is a holding company with propane marketing, utility and energy
marketing subsidiaries. Through subsidiaries, UGI owns 46% of AmeriGas
Partners, L. P. (NYSE: APU), the nation's largest retail propane marketer.
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UGI REPORTS HIGHER THIRD QUARTER EARNINGS, RAISES GUIDANCE PAGE 3
UGI invites interested parties to listen to the live audio webcast of
management's teleconference with the financial community about third quarter
fiscal year 2004 results on Wednesday, July 28, 2004 at 4:00 PM Eastern time.
The teleconference is available online at
http://www.shareholder.com/ugi/medialist.cfm. A telephonic replay of the call
can be accessed approximately two hours after the completion of the call at
1-888/203-1112, (International replay 719/457-0820) passcode 216131, until
midnight ET August 1, 2004.
The financial tables appended to this news release can be viewed directly at
HTTP://WWW.SHAREHOLDER.COM/UGI/3Q04FINANCIALTABLE.PDF.
Comprehensive information about UGI Corporation is available on the Internet at
HTTP://WWW.UGICORP.COM.
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 and currency exchange rates. UGI
undertakes no obligation to release revisions to its forward-looking statements
to reflect events or circumstances occurring after today.
C-11 ### 7/28/04
UGI CORPORATION
REPORT OF EARNINGS
(Millions, except per share)
(Unaudited)
Three Months Ended Nine Months Ended Twelve Months Ended
June 30, June 30, June 30,
---------------------- ----------------------- -----------------------
2004 2003 2004 2003 2004 2003
---------- ---------- ---------- ---------- ---------- ----------
Revenues:
AmeriGas Propane $ 315.1 $ 287.1 $ 1,463.0 $ 1,357.7 $ 1,733.7 $ 1,579.6
Gas Utility 97.7 99.7 490.5 484.7 545.7 541.7
Electric Utility 21.0 20.3 67.1 66.5 89.4 88.7
Energy Services (a) 217.3 191.6 779.0 513.7 933.3 575.3
International Propane 156.8 11.6 191.2 44.0 201.7 55.1
Corporate & Other 15.5 12.8 42.9 32.3 57.1 42.5
---------- ---------- ---------- ---------- ---------- ----------
Total revenues $ 823.4 $ 623.1 $ 3,033.7 $ 2,498.9 $ 3,560.9 $ 2,882.9
========== ========== ========== ========== ========== ==========
Operating income (loss):
AmeriGas Propane $ (4.0) $ (5.8) $ 188.8 $ 174.0 $ 179.3 $ 160.4
Gas Utility 6.9 5.5 82.8 94.1 84.8 97.7
Electric Utility 5.5 4.5 16.8 16.6 20.5 19.6
Energy Services (a) 10.2 4.3 24.0 14.1 29.1 19.0
International Propane 14.3 (1.0) 9.8 0.6 9.9 1.2
Corporate & Other 1.0 0.9 1.6 0.8 2.3 1.6
---------- ---------- ---------- ---------- ---------- ----------
Total operating income 33.9 8.4 323.8 300.2 325.9 299.5
Income (loss) from equity investees (0.6) 0.2 12.0 7.1 10.2 7.4
Loss on extinguishment of debt -- -- -- (3.0) -- (3.0)
Interest expense:
AmeriGas Propane (20.5) (21.5) (62.8) (66.0) (83.9) (87.3)
Gas Utility (3.9) (3.5) (11.9) (10.7) (16.6) (14.2)
Electric Utility (0.6) (0.4) (1.6) (1.7) (2.2) (2.3)
International Propane (8.3) (1.0) (10.2) (3.1) (11.2) (4.2)
Corporate and Other, net (0.2) (0.1) (0.4) (0.3) (0.4) (0.4)
---------- ---------- ---------- ---------- ---------- ----------
Total interest expense (33.5) (26.5) (86.9) (81.8) (114.3) (108.4)
Minority interests, principally in AmeriGas Partners 14.0 14.1 (64.3) (51.2) (47.7) (33.7)
---------- ---------- ---------- ---------- ---------- ----------
Income (loss) before income taxes and subsidiary
preferred stock dividends 13.8 (3.8) 184.6 171.3 174.1 161.8
Income tax (expense) benefit (5.5) 2.2 (70.4) (65.6) (65.5) (62.3)
Dividends on UGI Utilities preferred shares subject
to mandatory redemption -- (0.4) -- (1.2) -- (1.6)
---------- ---------- ---------- ---------- ---------- ----------
Net income (loss) $ 8.3 $ (2.0) $ 114.2 $ 104.5 $ 108.6 $ 97.9
========== ========== ========== ========== ========== ==========
Earnings (loss) per share:
Basic $ 0.16 $ (0.05) $ 2.48 $ 2.49 $ 2.40 $ 2.34
========== ========== ========== ========== ========== ==========
Diluted $ 0.16 $ (0.05) $ 2.43 $ 2.43 $ 2.34 $ 2.29
========== ========== ========== ========== ========== ==========
Average common shares outstanding:
Basic 50.915 42.451 46.005 42.031 45.321 41.899
========== ========== ========== ========== ========== ==========
Diluted 51.908 42.451 47.042 43.038 46.359 42.835
========== ========== ========== ========== ========== ==========
Supplemental information:
Net income (loss):
AmeriGas Propane (b) $ (7.0) $ (8.3) $ 36.7 $ 32.1 $ 27.8 $ 22.2
Gas Utility 1.3 1.0 42.1 49.1 41.0 48.5
Electric Utility 3.2 2.5 9.0 8.7 10.9 9.9
Energy Services (a) 6.0 2.4 14.0 8.2 17.0 11.1
International Propane 4.1 (0.4) 11.8 6.2 9.2 5.8
Corporate & Other 0.7 0.8 0.6 0.2 2.7 0.4
---------- ---------- ---------- ---------- ---------- ----------
Total net income (loss) $ 8.3 $ (2.0) $ 114.2 $ 104.5 $ 108.6 $ 97.9
========== ========== ========== ========== ========== ==========
(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) 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 Nine Months Ended Twelve Months Ended
June 30, June 30, June 30,
------------------- ------------------ -------------------
2004 2003 2004 2003 2004 2003
-------- -------- -------- -------- -------- --------
Revenues $118,717 $121,546 $557,618 $559,193 $635,183 $640,070
======== ======== ======== ======== ======== ========
Income before income taxes $ 7,883 $ 6,102 $ 86,049 $ 99,905 $ 86,356 $103,965
======== ======== ======== ======== ======== ========
Net income $ 4,495 $ 3,640 $ 51,152 $ 59,753 $ 52,071 $ 61,702
Dividends on preferred shares subject to mandatory redemption (a) -- 388 -- 1,163 -- 1,550
-------- -------- -------- -------- -------- --------
Net income after dividends on preferred shares subject to
mandatory redemption $ 4,495 $ 3,252 $ 51,152 $ 58,590 $ 52,071 $ 60,152
======== ======== ======== ======== ======== ========
(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.