Note 14 — Segment Information

Our operations comprise four reportable segments generally based upon products sold, geographic location and regulatory environment. Our reportable segments comprise: (1) AmeriGas Propane; (2) UGI International; (3) Midstream & Marketing; and (4) UGI Utilities.

As a result of changes in the composition of information reported to our chief operating decision maker (“CODM”), effective October 1, 2016, we combined (1) our UGI France reportable segment with our Flaga & Other reportable segment, collectively referred to as “UGI International”; and (2) our Energy Services reportable segment with our Electric Generation reportable segment, collectively referred to as “Midstream & Marketing.” In accordance with GAAP, prior-period amounts have been restated to reflect these changes.

The accounting policies of our reportable segments are the same as those described in Note 2, “Summary of Significant Accounting Policies,” in the Company’s 2016 Annual Report. We evaluate AmeriGas Propane’s performance principally based upon the Partnership’s earnings before interest expense, income taxes, depreciation and amortization as adjusted for the effects of gains and losses on commodity derivative instruments not associated with current-period transactions and other gains and losses that competitors do not necessarily have (“Partnership Adjusted EBITDA”). Although we use Partnership Adjusted EBITDA to evaluate AmeriGas Propane’s profitability, it should not be considered as an alternative to net income (as an indicator of operating performance) or as an alternative to cash flow (as a measure of liquidity or ability to service debt obligations) and is not a measure of performance or financial condition under GAAP. Our definition of Partnership Adjusted EBITDA may be different from that used by other companies. We evaluate the performance of our other reportable segments principally based upon their income before income taxes as adjusted for gains and losses on commodity and certain foreign currency derivative instruments not associated with current-period transactions. Net gains and losses on commodity and certain foreign currency derivative instruments not associated with current-period transactions are reflected in Corporate & Other because the Company’s CODM does not consider such items when evaluating the financial performance of our reportable segments.



Three Months Ended June 30, 2017	Total			Eliminations				AmeriGas Propane			UGI International			Midstream & Marketing			UGI Utilities			Corporate & Other (b)
Revenues	$	1,153.5		$	(36.9	)	(c)	$	467.5		$	351.3		$	222.8		$	146.6		$	2.2
Cost of sales	$	618.5		$	(36.2	)	(c)	$	197.5		$	178.2		$	189.4		$	52.0		$	37.6
Segment profit:
Operating (loss) income	$	(2.8	)	$	0.1			$	4.6		$	0.5		$	2.8		$	27.7		$	(38.5	)
Income from equity investees	0.9			—				—			0.1			0.8			—			—
Losses on foreign currency contracts, net	(16.2		)	—				—			(0.2		)	—			—			(16.0		)
Loss on extinguishment of debt	(4.4		)	—				(4.4		)	—			—			—			—
Interest expense	(56.8		)	—				(40.6		)	(5.6		)	(0.3		)	(10.2		)	(0.1		)
(Loss) income before income taxes	$	(79.3	)	$	0.1			$	(40.4	)	$	(5.2	)	$	3.3		$	17.5		$	(54.6	)
Partnership Adjusted EBITDA (a)								$	58.4
Noncontrolling interests’ net loss	$	(43.2	)	$	—			$	(38.5	)	$	(0.3	)	$	—		$	—		$	(4.4	)
Depreciation and amortization	$	104.1		$	(0.1	)		$	46.2		$	31.1		$	8.8		$	17.9		$	0.2
Capital expenditures (including the effects of accruals)	$	140.9		$	—			$	20.9		$	19.1		$	21.7		$	79.1		$	0.1



Three Months Ended June 30, 2016 (d)	Total			Eliminations				AmeriGas Propane			UGI International			Midstream & Marketing			UGI Utilities			Corporate & Other (b)
Revenues	$	1,130.8		$	(17.5	)	(c)	$	446.7		$	395.5		$	166.0		$	140.3		$	(0.2	)
Cost of sales	$	433.0		$	(16.7	)	(c)	$	170.8		$	179.7		$	124.1		$	44.4		$	(69.3	)
Segment profit:
Operating income	$	155.7		$	0.1			$	18.3		$	33.5		$	11.3		$	29.8		$	62.7
Loss from equity investees	—			—				—			—			—			—			—
Loss on extinguishments of debt	(37.1		)	—				(37.1		)	—			—			—			—
Interest expense	(56.4		)	—				(40.9		)	(5.8		)	(0.4		)	(9.1		)	(0.2		)
Income (loss) before income taxes	$	62.2		$	0.1			$	(59.7	)	$	27.7		$	10.9		$	20.7		$	62.5
Partnership Adjusted EBITDA (a)								$	64.6
Noncontrolling interests’ net (loss) income	$	(32.1	)	$	—			$	(52.4	)	$	(0.1	)	$	—		$	—		$	20.4
Depreciation and amortization	$	98.1		$	(0.1	)		$	46.4		$	27.4		$	7.6		$	16.6		$	0.2
Capital expenditures (including the effects of accruals)	$	137.4		$	—			$	18.7		$	25.9		$	36.3		$	56.5		$	—



Nine Months Ended June 30, 2017	Total			Eliminations				AmeriGas Propane			UGI International			Midstream & Marketing			UGI Utilities			Corporate & Other (b)
Revenues	$	5,006.8		$	(201.2	)	(c)	$	2,008.3		$	1,511.1		$	916.3		$	768.0		$	4.3
Cost of sales	$	2,337.1		$	(198.8	)	(c)	$	814.0		$	749.3		$	691.0		$	326.0		$	(44.4	)
Segment profit:
Operating income	$	976.6		$	0.2			$	373.8		$	210.4		$	134.6		$	226.3		$	31.3
Income (loss) from equity investees	3.0			—				—			(0.2		)	3.2			—			—
Losses on foreign currency contracts, net	(16.1		)	—				—			—			—			—			(16.1		)
Loss on extinguishments of debt	(59.7		)	—				(59.7		)	—			—			—			—
Interest expense	(168.0		)	—				(120.6		)	(15.2		)	(1.6		)	(30.5		)	(0.1		)
Income before income taxes	$	735.8		$	0.2			$	193.5		$	195.0		$	136.2		$	195.8		$	15.1
Partnership Adjusted EBITDA (a)								$	514.7
Noncontrolling interests’ net income (loss)	$	108.9		$	—			$	115.4		$	—		$	—		$	—		$	(6.5	)
Depreciation and amortization	$	301.5		$	(0.2	)		$	135.8		$	86.6		$	25.6		$	53.0		$	0.7
Capital expenditures (including the effects of accruals)	$	440.7		$	—			$	74.5		$	62.1		$	104.0		$	199.7		$	0.4
As of June 30, 2017
Total assets	$	11,246.4		$	(53.0	)		$	4,045.7		$	2,887.7		$	1,171.5		$	2,904.5		$	290.0
Short-term borrowings	$	163.9		$	—			$	75.5		$	8.4		$	30.0		$	50.0		$	—
Goodwill	$	3,032.3		$	—			$	2,001.4		$	837.3		$	11.5		$	182.1		$	—



Nine Months Ended June 30, 2016 (d)	Total			Eliminations				AmeriGas Propane			UGI International			Midstream & Marketing			UGI Utilities			Corporate & Other (b)
Revenues	$	4,709.5		$	(116.7	)	(c)	$	1,918.3		$	1,552.4		$	691.7		$	660.3		$	3.5
Cost of sales	$	1,943.9		$	(114.3	)	(c)	$	712.2		$	753.5		$	468.3		$	257.3		$	(133.1	)
Segment profit:
Operating income	$	1,076.6		$	0.2			$	398.3		$	230.1		$	132.0		$	192.6		$	123.4
Loss from equity investees	(0.1		)	—				—			(0.1		)	—			—			—
Loss on extinguishments of debt	(37.1		)	—				(37.1		)	—			—			—			—
Interest expense	(171.6		)	—				(122.7		)	(18.8		)	(1.7		)	(27.9		)	(0.5		)
Income before income taxes	$	867.8		$	0.2			$	238.5		$	211.2		$	130.3		$	164.7		$	122.9
Partnership Adjusted EBITDA (a)								$	537.7
Noncontrolling interests’ net income	$	196.0		$	—			$	150.9		$	0.1		$	—		$	—		$	45.0
Depreciation and amortization	$	299.4		$	(0.2	)		$	143.0		$	82.9		$	22.7		$	50.3		$	0.7
Capital expenditures (including the effects of accruals)	$	384.8		$	—			$	74.5		$	69.2		$	75.0		$	166.1		$	—
As of June 30, 2016
Total assets	$	11,103.9		$	(82.6	)		$	4,376.1		$	2,899.5		$	998.0		$	2,697.3		$	215.6
Short-term borrowings	$	144.0		$	—			$	11.4		$	2.6		$	—		$	130.0		$	—
Goodwill	$	2,981.3		$	—			$	1,978.2		$	809.5		$	11.5		$	182.1		$	—


(a)	The following table provides a reconciliation of Partnership Adjusted EBITDA to AmeriGas Propane (loss) income before income taxes:



	Three Months Ended June 30,						Nine Months Ended June 30,
	2017			2016			2017			2016
Partnership Adjusted EBITDA	$	58.4		$	64.6		$	514.7		$	537.7
Depreciation and amortization	(46.2		)	(46.4		)	(135.8		)	(143.0		)
Interest expense	(40.6		)	(40.9		)	(120.6		)	(122.7		)
Loss on extinguishments of debt	(4.4		)	(37.1		)	(59.7		)	(37.1		)
MGP environmental remediation accrual	(7.5		)	—			(7.5		)	—
Noncontrolling interest (i)	(0.1		)	0.1			2.4			3.6
(Loss) income before income taxes	$	(40.4	)	$	(59.7	)	$	193.5		$	238.5


(i)	Principally represents the General Partner’s 1.01% interest in AmeriGas OLP.

(b)

Corporate & Other results principally comprise (1) net expenses of UGI’s captive general liability insurance company and UGI’s corporate headquarters facility and (2) UGI’s unallocated corporate and general expenses and interest income. Corporate & Other results also include the effects of net pre-tax (losses) gains on commodity and certain foreign currency derivative instruments not associated with current-period transactions (including such amounts attributable to noncontrolling interests) totaling $(52.7) and $67.9 during the three months ended June 30, 2017 and 2016, respectively, and $28.9 and $133.0 during the nine months ended June 30, 2017 and 2016, respectively. Corporate & Other results for the nine months ended June 30, 2017, also includes a pre-tax loss of $7.0 associated with the impairment of a cost basis investment (see Note 2). Corporate & Other assets principally comprise cash and cash equivalents of UGI and its captive insurance company; UGI corporate headquarters’ assets; and our cost basis investment in a private equity partnership.


(c)	Represents the elimination of intersegment transactions principally among Midstream & Marketing, UGI Utilities and AmeriGas Propane.


(d)	Restated to reflect (1) the current-year changes in the presentation of our UGI International and Midstream & Marketing reportable segments and (2) the adoption of new accounting guidance related to debt issuance costs (see Note 2).