ý | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Pennsylvania | 23-2668356 | |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |
460 North Gulph Road, King of Prussia, PA | 19406 | |
(Address of principal executive offices) | (Zip Code) |
Large accelerated filer | ý | Accelerated filer | ¨ | Non-accelerated filer | ¨ | ||
Smaller reporting company | ¨ | Emerging growth company | ¨ |
Page | |
December 31, 2017 | September 30, 2017 | December 31, 2016 | ||||||||||
ASSETS | ||||||||||||
Current assets: | ||||||||||||
Cash and cash equivalents | $ | 446.4 | $ | 558.4 | $ | 515.2 | ||||||
Restricted cash | 19.8 | 10.3 | 7.9 | |||||||||
Accounts receivable (less allowances for doubtful accounts of $35.1, $26.9 and $29.2, respectively) | 1,101.8 | 626.8 | 917.3 | |||||||||
Accrued utility revenues | 95.9 | 13.3 | 55.6 | |||||||||
Inventories | 307.3 | 278.6 | 228.2 | |||||||||
Utility regulatory assets | 0.6 | 8.3 | 1.6 | |||||||||
Derivative instruments | 73.4 | 63.1 | 87.0 | |||||||||
Prepaid expenses and other current assets | 135.4 | 138.7 | 97.1 | |||||||||
Total current assets | 2,180.6 | 1,697.5 | 1,909.9 | |||||||||
Property, plant and equipment, at cost (less accumulated depreciation and amortization of $3,393.1, $3,312.9 and $3,139.8, respectively) | 5,690.5 | 5,537.0 | 5,244.3 | |||||||||
Goodwill | 3,185.5 | 3,107.2 | 2,935.8 | |||||||||
Intangible assets, net | 641.9 | 611.7 | 558.9 | |||||||||
Utility regulatory assets | 362.2 | 360.6 | 391.3 | |||||||||
Derivative instruments | 13.3 | 9.2 | 24.2 | |||||||||
Other assets | 269.9 | 259.0 | 236.1 | |||||||||
Total assets | $ | 12,343.9 | $ | 11,582.2 | $ | 11,300.5 | ||||||
LIABILITIES AND EQUITY | ||||||||||||
Current liabilities: | ||||||||||||
Current maturities of long-term debt | $ | 224.1 | $ | 177.5 | $ | 48.5 | ||||||
Short-term borrowings | 586.1 | 366.9 | 234.4 | |||||||||
Accounts payable | 680.8 | 439.6 | 573.6 | |||||||||
Derivative instruments | 32.7 | 25.0 | 16.2 | |||||||||
Other current liabilities | 692.3 | 681.1 | 702.2 | |||||||||
Total current liabilities | 2,216.0 | 1,690.1 | 1,574.9 | |||||||||
Long-term debt | 4,056.4 | 3,994.6 | 3,994.2 | |||||||||
Deferred income taxes | 890.7 | 1,357.0 | 1,204.7 | |||||||||
Deferred investment tax credits | 2.9 | 3.0 | 3.2 | |||||||||
Derivative instruments | 22.2 | 21.8 | 16.6 | |||||||||
Other noncurrent liabilities | 1,073.6 | 774.8 | 773.8 | |||||||||
Total liabilities | 8,261.8 | 7,841.3 | 7,567.4 | |||||||||
Commitments and contingencies (Note 10) | ||||||||||||
Equity: | ||||||||||||
UGI Corporation stockholders’ equity: | ||||||||||||
UGI Common Stock, without par value (authorized — 450,000,000 shares; issued — 173,997,441, 173,987,691 and 173,903,191 shares, respectively) | 1,189.3 | 1,188.6 | 1,203.4 | |||||||||
Retained earnings | 2,429.3 | 2,106.7 | 2,035.4 | |||||||||
Accumulated other comprehensive loss | (71.5 | ) | (93.4 | ) | (216.8 | ) | ||||||
Treasury stock, at cost | (45.4 | ) | (38.6 | ) | (34.3 | ) | ||||||
Total UGI Corporation stockholders’ equity | 3,501.7 | 3,163.3 | 2,987.7 | |||||||||
Noncontrolling interests, principally in AmeriGas Partners | 580.4 | 577.6 | 745.4 | |||||||||
Total equity | 4,082.1 | 3,740.9 | 3,733.1 | |||||||||
Total liabilities and equity | $ | 12,343.9 | $ | 11,582.2 | $ | 11,300.5 |
Three Months Ended December 31, | ||||||||
2017 | 2016 | |||||||
Revenues | $ | 2,125.2 | $ | 1,679.5 | ||||
Costs and expenses: | ||||||||
Cost of sales (excluding depreciation shown below) | 1,137.4 | 647.4 | ||||||
Operating and administrative expenses | 490.1 | 468.5 | ||||||
Depreciation | 95.5 | 83.7 | ||||||
Amortization | 14.8 | 14.4 | ||||||
Other operating income, net | (4.4 | ) | (0.7 | ) | ||||
1,733.4 | 1,213.3 | |||||||
Operating income | 391.8 | 466.2 | ||||||
Income (loss) from equity investees | 1.0 | (0.2 | ) | |||||
Loss on extinguishments of debt | — | (33.2 | ) | |||||
(Losses) gains on foreign currency contracts, net | (4.8 | ) | 1.3 | |||||
Interest expense | (58.2 | ) | (55.4 | ) | ||||
Income before income taxes | 329.8 | 378.7 | ||||||
Income tax benefit (expense) | 104.4 | (87.8 | ) | |||||
Net income including noncontrolling interests | 434.2 | 290.9 | ||||||
Deduct net income attributable to noncontrolling interests, principally in AmeriGas Partners | (68.3 | ) | (60.2 | ) | ||||
Net income attributable to UGI Corporation | $ | 365.9 | $ | 230.7 | ||||
Earnings per common share attributable to UGI Corporation stockholders | ||||||||
Basic | $ | 2.11 | $ | 1.33 | ||||
Diluted | $ | 2.07 | $ | 1.30 | ||||
Weighted average common shares outstanding (thousands) | ||||||||
Basic | 173,670 | 173,512 | ||||||
Diluted | 176,948 | 176,984 | ||||||
Dividends declared per common share | $ | 0.2500 | $ | 0.2375 |
Three Months Ended December 31, | |||||||
2017 | 2016 | ||||||
Net income including noncontrolling interests | $ | 434.2 | $ | 290.9 | |||
Other comprehensive income (loss): | |||||||
Net (losses) gains on derivative instruments (net of tax of $0.2 and $(6.0), respectively) | (0.4 | ) | 12.3 | ||||
Reclassifications of net gains on derivative instruments (net of tax of $0.1 and $2.1, respectively) | (0.4 | ) | (4.5 | ) | |||
Foreign currency adjustments | 22.3 | (70.9 | ) | ||||
Benefit plans (net of tax of $(0.2) and $(0.6), respectively) | 0.4 | 1.0 | |||||
Other comprehensive income (loss) | 21.9 | (62.1 | ) | ||||
Comprehensive income including noncontrolling interests | 456.1 | 228.8 | |||||
Deduct comprehensive income attributable to noncontrolling interests, principally in AmeriGas Partners | (68.3 | ) | (60.2 | ) | |||
Comprehensive income attributable to UGI Corporation | $ | 387.8 | $ | 168.6 |
Three Months Ended December 31, | ||||||||
2017 | 2016 | |||||||
CASH FLOWS FROM OPERATING ACTIVITIES | ||||||||
Net income including noncontrolling interests | $ | 434.2 | $ | 290.9 | ||||
Adjustments to reconcile net income including noncontrolling interests to net cash provided by operating activities: | ||||||||
Depreciation and amortization | 110.3 | 98.1 | ||||||
Deferred income taxes | (173.9 | ) | (5.9 | ) | ||||
Provision for uncollectible accounts | 9.3 | 6.7 | ||||||
Change in unrealized losses (gains) on derivative instruments | (6.6 | ) | (104.2 | ) | ||||
Loss on extinguishments of debt | — | 33.2 | ||||||
Other, net | 11.3 | 15.1 | ||||||
Net change in: | ||||||||
Accounts receivable and accrued utility revenues | (530.5 | ) | (437.0 | ) | ||||
Inventories | (23.5 | ) | (22.4 | ) | ||||
Utility deferred fuel and power costs, net of changes in unsettled derivatives | 11.6 | (1.0 | ) | |||||
Accounts payable | 235.0 | 221.4 | ||||||
Other current assets | (34.0 | ) | (7.3 | ) | ||||
Other current liabilities | (11.8 | ) | 39.0 | |||||
Net cash provided by operating activities | 31.4 | 126.6 | ||||||
CASH FLOWS FROM INVESTING ACTIVITIES | ||||||||
Expenditures for property, plant and equipment | (147.5 | ) | (197.1 | ) | ||||
Acquisitions of businesses and assets, net of cash acquired | (175.8 | ) | (0.8 | ) | ||||
Decrease in restricted cash | (9.5 | ) | 7.7 | |||||
Other, net | 5.3 | (2.2 | ) | |||||
Net cash used by investing activities | (327.5 | ) | (192.4 | ) | ||||
CASH FLOWS FROM FINANCING ACTIVITIES | ||||||||
Dividends on UGI Common Stock | (43.3 | ) | (41.2 | ) | ||||
Distributions on AmeriGas Partners publicly held Common Units | (65.7 | ) | (65.0 | ) | ||||
Issuances of debt, net of issuance costs | 124.3 | 789.6 | ||||||
Repayments of debt, including redemption premiums | (41.9 | ) | (530.9 | ) | ||||
Increase (decrease) in short-term borrowings | 212.5 | (66.7 | ) | |||||
Receivables Facility net borrowings | 6.0 | 9.5 | ||||||
Issuances of UGI Common Stock | 1.4 | 3.3 | ||||||
Repurchases of UGI Common Stock | (9.5 | ) | — | |||||
Other | (2.7 | ) | — | |||||
Net cash provided by financing activities | 181.1 | 98.6 | ||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | 3.0 | (20.4 | ) | |||||
Cash and cash equivalents (decrease) increase | $ | (112.0 | ) | $ | 12.4 | |||
CASH AND CASH EQUIVALENTS | ||||||||
End of period | $ | 446.4 | $ | 515.2 | ||||
Beginning of period | 558.4 | 502.8 | ||||||
(Decrease) increase | $ | (112.0 | ) | $ | 12.4 |
Three Months Ended December 31, | |||||||
2017 | 2016 | ||||||
Common stock, without par value | |||||||
Balance, beginning of period | $ | 1,188.6 | $ | 1,201.6 | |||
Common Stock issued in connection with employee and director plans (including losses on treasury stock transactions), net of tax withheld | (1.3 | ) | (1.2 | ) | |||
Equity-based compensation expense | 2.0 | 1.6 | |||||
Gain on sale of treasury stock | — | 1.4 | |||||
Balance, end of period | $ | 1,189.3 | $ | 1,203.4 | |||
Retained earnings | |||||||
Balance, beginning of period | $ | 2,106.7 | $ | 1,840.9 | |||
Cumulative effect of change in accounting for employee share-based payments | — | 5.0 | |||||
Net income attributable to UGI Corporation | 365.9 | 230.7 | |||||
Cash dividends on Common Stock | (43.3 | ) | (41.2 | ) | |||
Balance, end of period | $ | 2,429.3 | $ | 2,035.4 | |||
Accumulated other comprehensive income (loss) | |||||||
Balance, beginning of period | $ | (93.4 | ) | $ | (154.7 | ) | |
Net (losses) gains on derivative instruments | (0.4 | ) | 12.3 | ||||
Reclassification of net gains on derivative instruments | (0.4 | ) | (4.5 | ) | |||
Benefit plans | 0.4 | 1.0 | |||||
Foreign currency adjustments | 22.3 | (70.9 | ) | ||||
Balance, end of period | $ | (71.5 | ) | $ | (216.8 | ) | |
Treasury stock | |||||||
Balance, beginning of period | $ | (38.6 | ) | $ | (36.9 | ) | |
Common stock issued in connection with employee and director plans, net of tax withheld | 2.7 | 2.8 | |||||
Repurchases of Common Stock | (9.5 | ) | — | ||||
Reacquired common stock — employee and director plans | — | (0.4 | ) | ||||
Sale of treasury stock | — | 0.2 | |||||
Balance, end of period | $ | (45.4 | ) | $ | (34.3 | ) | |
Total UGI Corporation stockholders’ equity | $ | 3,501.7 | $ | 2,987.7 | |||
Noncontrolling interests | |||||||
Balance, beginning of period | $ | 577.6 | $ | 750.9 | |||
Net income attributable to noncontrolling interests, principally in AmeriGas Partners | 68.3 | 60.2 | |||||
Dividends and distributions | (65.7 | ) | (65.0 | ) | |||
Other | 0.2 | (0.7 | ) | ||||
Balance, end of period | $ | 580.4 | $ | 745.4 | |||
Total equity | $ | 4,082.1 | $ | 3,733.1 |
Three Months Ended December 31, | ||||||
2017 | 2016 | |||||
Denominator (thousands of shares): | ||||||
Weighted-average common shares outstanding — basic | 173,670 | 173,512 | ||||
Incremental shares issuable for stock options and awards (a) | 3,278 | 3,472 | ||||
Weighted-average common shares outstanding — diluted | 176,948 | 176,984 |
(a) | For the three months ended December 31, 2017, there were 146 shares associated with outstanding stock option awards that were not included in the computation of diluted earnings per share above because their effect was antidilutive. For the three months ended December 31, 2016, there were no such antidilutive shares. |
December 31, 2017 | September 30, 2017 | December 31, 2016 | ||||||||||
Non-utility LPG and natural gas | $ | 216.4 | $ | 188.4 | $ | 150.9 | ||||||
Gas Utility natural gas | 34.6 | 39.5 | 25.8 | |||||||||
Materials, supplies and other | 56.3 | 50.7 | 51.5 | |||||||||
Total inventories | $ | 307.3 | $ | 278.6 | $ | 228.2 |
(1) | a $180.3 reduction in net deferred tax liabilities in the U.S from the reduction of the U.S. tax rate; |
(2) | the establishment of $12.6 of valuation allowances related to deferred tax assets impacted by U.S. tax law changes; and |
(3) | a $1.7 “toll tax” on un-repatriated foreign earnings. |
December 31, 2017 | September 30, 2017 | December 31, 2016 | ||||||||||
Goodwill (not subject to amortization) | $ | 3,185.5 | $ | 3,107.2 | $ | 2,935.8 | ||||||
Intangible assets: | ||||||||||||
Customer relationships, noncompete agreements and other | $ | 862.0 | $ | 817.8 | $ | 759.4 | ||||||
Accumulated amortization | (355.0 | ) | (340.2 | ) | (329.0 | ) | ||||||
Intangible assets, net (definite-lived) | 507.0 | 477.6 | 430.4 | |||||||||
Trademarks and tradenames (indefinite-lived) | 134.9 | 134.1 | 128.5 | |||||||||
Total intangible assets, net | $ | 641.9 | $ | 611.7 | $ | 558.9 |
December 31, 2017 | September 30, 2017 | December 31, 2016 | ||||||||||
Regulatory assets: | ||||||||||||
Income taxes recoverable | $ | 126.5 | $ | 121.4 | $ | 117.8 | ||||||
Underfunded pension and postretirement plans | 138.3 | 141.3 | 179.4 | |||||||||
Environmental costs | 60.8 | 61.6 | 61.4 | |||||||||
Deferred fuel and power costs | 0.1 | 7.7 | — | |||||||||
Removal costs, net | 31.4 | 31.0 | 27.1 | |||||||||
Other | 5.7 | 5.9 | 7.2 | |||||||||
Total regulatory assets | $ | 362.8 | $ | 368.9 | $ | 392.9 | ||||||
Regulatory liabilities (a): | ||||||||||||
Postretirement benefits | $ | 17.3 | $ | 17.5 | $ | 17.3 | ||||||
Deferred fuel and power refunds | 12.7 | 10.6 | 23.8 | |||||||||
State tax benefits — distribution system repairs | 19.1 | 18.4 | 15.6 | |||||||||
Excess federal deferred income taxes (b) | 303.9 | — | — | |||||||||
Other | 4.5 | 2.7 | 2.0 | |||||||||
Total regulatory liabilities | $ | 357.5 | $ | 49.2 | $ | 58.7 |
(a) | Regulatory liabilities are recorded in “Other current liabilities” and “Other noncurrent liabilities” on the Condensed Consolidated Balance Sheets. |
(b) | Balance at December 31, 2017, comprises excess deferred federal income taxes resulting from the enactment of the TCJA (see below and Note 5). |
Three Months Ended December 31, | ||||||||
2017 | 2016 | |||||||
Trade receivables transferred to ESFC during the period | $ | 270.6 | $ | 246.4 | ||||
ESFC trade receivables sold to the bank during the period | $ | 48.0 | $ | 66.0 |
December 31, 2017 | September 30, 2017 | December 31, 2016 | ||||||||||
ESFC trade receivables — end of period (a) | $ | 101.0 | $ | 44.8 | $ | 81.4 |
(a) | At December 31, 2017, September 30, 2017 and December 31, 2016, the amounts of ESFC trade receivables sold to the bank were $45.0, $39.0, and $35.0, respectively, and are reflected as “Short-term borrowings” on the Condensed Consolidated Balance Sheets. |
Pension Benefits | Other Postretirement Benefits | |||||||||||||||
Three Months Ended December 31, | 2017 | 2016 | 2017 | 2016 | ||||||||||||
Service cost | $ | 2.8 | $ | 3.0 | $ | 0.2 | $ | 0.2 | ||||||||
Interest cost | 6.5 | 6.2 | 0.2 | 0.2 | ||||||||||||
Expected return on assets | (8.6 | ) | (8.3 | ) | (0.2 | ) | (0.2 | ) | ||||||||
Amortization of: | ||||||||||||||||
Prior service cost (benefit) | 0.1 | 0.1 | (0.1 | ) | (0.1 | ) | ||||||||||
Actuarial loss | 3.3 | 4.1 | 0.1 | 0.1 | ||||||||||||
Net benefit cost | 4.1 | 5.1 | 0.2 | 0.2 | ||||||||||||
Change in associated regulatory liabilities | — | — | (0.1 | ) | (0.1 | ) | ||||||||||
Net benefit cost after change in regulatory liabilities | $ | 4.1 | $ | 5.1 | $ | 0.1 | $ | 0.1 |
Asset (Liability) | ||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | |||||||||||||
December 31, 2017: | ||||||||||||||||
Derivative instruments: | ||||||||||||||||
Assets: | ||||||||||||||||
Commodity contracts | $ | 47.9 | $ | 71.7 | $ | — | $ | 119.6 | ||||||||
Foreign currency contracts | $ | — | $ | 11.6 | $ | — | $ | 11.6 | ||||||||
Liabilities: | ||||||||||||||||
Commodity contracts | $ | (31.0 | ) | $ | (13.5 | ) | $ | — | $ | (44.5 | ) | |||||
Foreign currency contracts | $ | — | $ | (39.9 | ) | $ | — | $ | (39.9 | ) | ||||||
Interest rate contracts | $ | — | $ | (2.1 | ) | $ | — | $ | (2.1 | ) | ||||||
Cross-currency contracts | $ | — | $ | (0.9 | ) | $ | — | $ | (0.9 | ) | ||||||
Non-qualified supplemental postretirement grantor trust investments (a) | $ | 37.7 | $ | — | $ | — | $ | 37.7 | ||||||||
September 30, 2017: | ||||||||||||||||
Derivative instruments: | ||||||||||||||||
Assets: | ||||||||||||||||
Commodity contracts | $ | 27.2 | $ | 76.9 | $ | — | $ | 104.1 | ||||||||
Foreign currency contracts | $ | — | $ | 12.2 | $ | — | $ | 12.2 | ||||||||
Liabilities: | ||||||||||||||||
Commodity contracts | $ | (27.7 | ) | $ | (11.4 | ) | $ | — | $ | (39.1 | ) | |||||
Foreign currency contracts | $ | — | $ | (38.2 | ) | $ | — | $ | (38.2 | ) | ||||||
Interest rate contracts | $ | — | $ | (2.3 | ) | $ | — | $ | (2.3 | ) | ||||||
Cross-currency contracts | $ | — | $ | (2.9 | ) | $ | — | $ | (2.9 | ) | ||||||
Non-qualified supplemental postretirement grantor trust investments (a) | $ | 35.6 | $ | — | $ | — | $ | 35.6 | ||||||||
December 31, 2016: | ||||||||||||||||
Derivative instruments: | ||||||||||||||||
Assets: | ||||||||||||||||
Commodity contracts | $ | 62.7 | $ | 61.8 | $ | — | $ | 124.5 | ||||||||
Foreign currency contracts | $ | — | $ | 26.0 | $ | — | $ | 26.0 | ||||||||
Cross-currency contracts | $ | — | $ | 3.5 | $ | — | $ | 3.5 | ||||||||
Liabilities: | ||||||||||||||||
Commodity contracts | $ | (53.1 | ) | $ | (12.4 | ) | $ | — | $ | (65.5 | ) | |||||
Foreign currency contracts | $ | — | $ | (0.2 | ) | $ | — | $ | (0.2 | ) | ||||||
Interest rate contracts | $ | — | $ | (2.8 | ) | $ | — | $ | (2.8 | ) | ||||||
Non-qualified supplemental postretirement grantor trust investments (a) | $ | 34.2 | $ | — | $ | — | $ | 34.2 |
(a) | Consists primarily of mutual fund investments held in grantor trusts associated with non-qualified supplemental retirement plans. |
December 31, 2017 | September 30, 2017 | December 31, 2016 | |||||||||
Carrying amount | $ | 4,319.5 | $ | 4,211.9 | $ | 4,083.8 | |||||
Estimated fair value | $ | 4,430.0 | $ | 4,346.8 | $ | 4,171.0 |
Notional Amounts (in millions) | ||||||||||||||||
Type | Units | Settlements Extending Through | December 31, 2017 | September 30, 2017 | December 31, 2016 | |||||||||||
Commodity Price Risk: | ||||||||||||||||
Regulated Utility Operations | ||||||||||||||||
Gas Utility NYMEX natural gas futures and option contracts | Dekatherms | September 2018 | 13.4 | 14.8 | 11.7 | |||||||||||
FTRs contracts | Kilowatt hours | May 2018 | 63.1 | 101.2 | 36.2 | |||||||||||
Non-utility Operations | ||||||||||||||||
LPG swaps & options | Gallons | December 2020 | 275.4 | 325.5 | 325.9 | |||||||||||
Natural gas futures, forward and pipeline contracts (a) | Dekatherms | December 2021 | 128.3 | 75.9 | 70.2 | |||||||||||
Natural gas basis swap contracts | Dekatherms | March 2022 | 90.2 | 104.2 | 120.1 | |||||||||||
NYMEX natural gas storage | Dekatherms | March 2019 | 1.3 | 1.9 | 1.3 | |||||||||||
NYMEX propane storage | Gallons | March 2018 | 0.1 | 0.3 | — | |||||||||||
Electricity long forward and futures contracts (a) | Kilowatt hours | May 2021 | 4,733.9 | 4,440.3 | 685.5 | |||||||||||
Electricity short forward and futures contracts | Kilowatt hours | May 2021 | 325.2 | 447.0 | 352.5 | |||||||||||
Interest Rate Risk: | ||||||||||||||||
Interest rate swaps | Euro | October 2020 | € | 645.8 | € | 645.8 | € | 645.8 | ||||||||
Foreign Currency Exchange Rate Risk: | ||||||||||||||||
Forward foreign currency exchange contracts | USD | August 2021 | $ | 485.7 | $ | 424.8 | $ | 416.7 | ||||||||
Cross-currency contracts | USD | April 2020 | $ | 49.9 | $ | 59.1 | $ | 59.1 |
(a) | Amounts at December 31, 2017 and September 30, 2017, include derivative contracts held by DVEP which was acquired on August 31, 2017. |
December 31, 2017 | September 30, 2017 | December 31, 2016 | ||||||||||
Derivative assets: | ||||||||||||
Derivatives designated as hedging instruments: | ||||||||||||
Foreign currency contracts | $ | 1.2 | $ | 3.2 | $ | 24.6 | ||||||
Cross-currency contracts | — | — | 3.5 | |||||||||
1.2 | 3.2 | 28.1 | ||||||||||
Derivatives subject to PGC and DS mechanisms: | ||||||||||||
Commodity contracts | 0.4 | 1.7 | 6.9 | |||||||||
Derivatives not designated as hedging instruments: | ||||||||||||
Commodity contracts | 119.2 | 102.4 | 117.6 | |||||||||
Foreign currency contracts | 10.4 | 9.0 | 1.4 | |||||||||
129.6 | 111.4 | 119.0 | ||||||||||
Total derivative assets — gross | 131.2 | 116.3 | 154.0 | |||||||||
Gross amounts offset in the balance sheet | (32.5 | ) | (35.7 | ) | (35.7 | ) | ||||||
Cash collateral received | (12.0 | ) | (8.3 | ) | (7.1 | ) | ||||||
Total derivative assets — net | $ | 86.7 | $ | 72.3 | $ | 111.2 | ||||||
Derivative liabilities: | ||||||||||||
Derivatives designated as hedging instruments: | ||||||||||||
Foreign currency contracts | $ | (5.6 | ) | $ | (5.5 | ) | $ | — | ||||
Cross-currency contracts | (0.9 | ) | (2.9 | ) | — | |||||||
Interest rate contracts | (2.1 | ) | (2.3 | ) | (2.8 | ) | ||||||
(8.6 | ) | (10.7 | ) | (2.8 | ) | |||||||
Derivatives subject to PGC and DS mechanisms: | ||||||||||||
Commodity contracts | (2.3 | ) | (1.5 | ) | (0.3 | ) | ||||||
Derivatives not designated as hedging instruments: | ||||||||||||
Commodity contracts | (42.2 | ) | (37.6 | ) | (65.2 | ) | ||||||
Foreign currency contracts | (34.3 | ) | (32.7 | ) | (0.2 | ) | ||||||
(76.5 | ) | (70.3 | ) | (65.4 | ) | |||||||
Total derivative liabilities — gross | (87.4 | ) | (82.5 | ) | (68.5 | ) | ||||||
Gross amounts offset in the balance sheet | 32.5 | 35.7 | 35.7 | |||||||||
Total derivative liabilities — net | $ | (54.9 | ) | $ | (46.8 | ) | $ | (32.8 | ) |
Three Months Ended December 31,: | ||||||||||||||||||
Gain (Loss) Recognized in AOCI | Gain (Loss) Reclassified from AOCI into Income | Location of Gain (Loss) Reclassified from AOCI into Income | ||||||||||||||||
Cash Flow Hedges: | 2017 | 2016 | 2017 | 2016 | ||||||||||||||
Foreign currency contracts | $ | (1.4 | ) | $ | 17.2 | $ | 0.8 | $ | 7.9 | Cost of sales | ||||||||
Cross-currency contracts | 0.1 | (0.1 | ) | 0.2 | (0.3 | ) | Interest expense/other operating income, net | |||||||||||
Interest rate contracts | 0.7 | 1.2 | (0.5 | ) | (1.0 | ) | Interest expense | |||||||||||
Total | $ | (0.6 | ) | $ | 18.3 | $ | 0.5 | $ | 6.6 | |||||||||
Gain (Loss) Recognized in Income | Location of Gain (Loss) Recognized in Income | |||||||||||||||||
Derivatives Not Designated as Hedging Instruments: | 2017 | 2016 | ||||||||||||||||
Commodity contracts | $ | 24.4 | $ | 108.5 | Cost of sales | |||||||||||||
Commodity contracts | (1.3 | ) | 0.1 | Revenues | ||||||||||||||
Commodity contracts | 0.1 | (0.1 | ) | Operating and administrative expenses | ||||||||||||||
Foreign currency contracts | (4.8 | ) | 1.3 | (Losses) gains on foreign currency contracts, net | ||||||||||||||
Total | $ | 18.4 | $ | 109.8 |
Three Months Ended December 31, 2017 | Postretirement Benefit Plans | Derivative Instruments | Foreign Currency | Total | ||||||||||||
AOCI — September 30, 2017 | $ | (19.2 | ) | $ | (21.4 | ) | $ | (52.8 | ) | $ | (93.4 | ) | ||||
Other comprehensive (loss) income before reclassification adjustments (after-tax) | — | (0.4 | ) | 22.3 | 21.9 | |||||||||||
Amounts reclassified from AOCI: | ||||||||||||||||
Reclassification adjustments (pre-tax) | 0.6 | (0.5 | ) | — | 0.1 | |||||||||||
Reclassification adjustments tax (benefit) expense | (0.2 | ) | 0.1 | — | (0.1 | ) | ||||||||||
Reclassification adjustments (after-tax) | 0.4 | (0.4 | ) | — | — | |||||||||||
Other comprehensive income (loss) attributable to UGI | 0.4 | (0.8 | ) | 22.3 | 21.9 | |||||||||||
AOCI — December 31, 2017 | $ | (18.8 | ) | $ | (22.2 | ) | $ | (30.5 | ) | $ | (71.5 | ) | ||||
Three Months Ended December 31, 2016 | Postretirement Benefit Plans | Derivative Instruments | Foreign Currency | Total | ||||||||||||
AOCI — September 30, 2016 | $ | (29.1 | ) | $ | (13.4 | ) | $ | (112.2 | ) | $ | (154.7 | ) | ||||
Other comprehensive income (loss) before reclassification adjustments (after-tax) | — | 12.3 | (70.9 | ) | (58.6 | ) | ||||||||||
Amounts reclassified from AOCI: | ||||||||||||||||
Reclassification adjustments (pre-tax) | 1.6 | (6.6 | ) | — | (5.0 | ) | ||||||||||
Reclassification adjustments tax (benefit) expense | (0.6 | ) | 2.1 | — | 1.5 | |||||||||||
Reclassification adjustments (after-tax) | 1.0 | (4.5 | ) | — | (3.5 | ) | ||||||||||
Other comprehensive income (loss) attributable to UGI | 1.0 | 7.8 | (70.9 | ) | (62.1 | ) | ||||||||||
AOCI — December 31, 2016 | $ | (28.1 | ) | $ | (5.6 | ) | $ | (183.1 | ) | $ | (216.8 | ) |
Three Months Ended December 31, 2017 | Total | Eliminations | AmeriGas Propane | UGI International | Midstream & Marketing | UGI Utilities | Corporate & Other (b) | |||||||||||||||||||||
Revenues | $ | 2,125.2 | $ | — | $ | 787.3 | $ | 784.2 | $ | 249.8 | $ | 305.4 | $ | (1.5 | ) | |||||||||||||
Intersegment revenues | $ | — | $ | (97.1 | ) | (c) | $ | — | $ | — | $ | 78.2 | $ | 17.7 | $ | 1.2 | ||||||||||||
Cost of sales | $ | 1,137.4 | $ | (96.0 | ) | (c) | $ | 366.1 | $ | 484.8 | $ | 239.0 | $ | 151.8 | $ | (8.3 | ) | |||||||||||
Segment profit: | ||||||||||||||||||||||||||||
Operating income | $ | 391.8 | $ | 0.2 | $ | 147.9 | $ | 93.1 | $ | 52.3 | $ | 96.3 | $ | 2.0 | ||||||||||||||
Income (loss) from equity investees | 1.0 | — | — | (0.2 | ) | 1.2 | (d) | — | — | |||||||||||||||||||
Losses on foreign currency contracts, net | (4.8 | ) | — | — | (4.7 | ) | — | — | (0.1 | ) | ||||||||||||||||||
Interest expense | (58.2 | ) | — | (40.6 | ) | (5.6 | ) | (0.9 | ) | (10.9 | ) | (0.2 | ) | |||||||||||||||
Income before income taxes | $ | 329.8 | $ | 0.2 | $ | 107.3 | $ | 82.6 | $ | 52.6 | $ | 85.4 | $ | 1.7 | ||||||||||||||
Partnership Adjusted EBITDA (a) | $ | 194.1 | ||||||||||||||||||||||||||
Noncontrolling interests’ net income (loss) | $ | 68.3 | $ | — | $ | 68.0 | $ | (0.3 | ) | $ | — | $ | — | $ | 0.6 | |||||||||||||
Depreciation and amortization | $ | 110.3 | $ | — | $ | 47.4 | $ | 32.2 | $ | 10.1 | $ | 20.4 | $ | 0.2 | ||||||||||||||
Capital expenditures (including the effects of accruals) | $ | 128.5 | $ | — | $ | 23.6 | $ | 21.7 | $ | 11.3 | $ | 71.7 | $ | 0.2 | ||||||||||||||
As of December 31, 2017 | ||||||||||||||||||||||||||||
Total assets | $ | 12,343.9 | $ | (62.6 | ) | $ | 4,206.2 | $ | 3,450.1 | $ | 1,325.1 | $ | 3,174.7 | $ | 250.4 | |||||||||||||
Short-term borrowings | $ | 586.1 | $ | — | $ | 263.5 | $ | 41.1 | $ | 100.0 | $ | 181.5 | $ | — | ||||||||||||||
Goodwill | $ | 3,185.5 | $ | — | $ | 2,001.3 | $ | 990.6 | $ | 11.5 | $ | 182.1 | $ | — |
Three Months Ended December 31, 2016 | Total | Eliminations | AmeriGas Propane | UGI International | Midstream & Marketing | UGI Utilities | Corporate & Other (b) | |||||||||||||||||||||
Revenues | $ | 1,679.5 | $ | — | $ | 677.2 | $ | 539.1 | $ | 209.6 | $ | 253.9 | $ | (0.3 | ) | |||||||||||||
Intersegment revenues | $ | — | $ | (68.5 | ) | (c) | $ | — | $ | — | $ | 60.2 | $ | 7.5 | $ | 0.8 | ||||||||||||
Cost of sales | $ | 647.4 | $ | (67.7 | ) | (c) | $ | 260.7 | $ | 258.0 | $ | 191.8 | $ | 109.5 | $ | (104.9 | ) | |||||||||||
Segment profit: | ||||||||||||||||||||||||||||
Operating income | $ | 466.2 | $ | 0.1 | $ | 141.9 | $ | 88.9 | $ | 49.7 | $ | 82.2 | $ | 103.4 | ||||||||||||||
Loss from equity investees | (0.2 | ) | — | — | (0.2 | ) | — | — | — | |||||||||||||||||||
Gains on foreign currency contracts, net | 1.3 | — | — | 0.1 | — | — | 1.2 | |||||||||||||||||||||
Loss on extinguishments of debt | (33.2 | ) | — | (33.2 | ) | — | — | — | — | |||||||||||||||||||
Interest expense | (55.4 | ) | — | (40.0 | ) | (4.8 | ) | (0.6 | ) | (10.0 | ) | — | ||||||||||||||||
Income before income taxes | $ | 378.7 | $ | 0.1 | $ | 68.7 | $ | 84.0 | $ | 49.1 | $ | 72.2 | $ | 104.6 | ||||||||||||||
Partnership Adjusted EBITDA (a) | $ | 185.1 | ||||||||||||||||||||||||||
Noncontrolling interests’ net income | $ | 60.2 | $ | — | $ | 41.2 | $ | 0.2 | $ | — | $ | — | $ | 18.8 | ||||||||||||||
Depreciation and amortization | $ | 98.1 | $ | — | $ | 44.6 | $ | 27.9 | $ | 8.0 | $ | 17.4 | $ | 0.2 | ||||||||||||||
Capital expenditures (including the effects of accruals) | $ | 173.6 | $ | — | $ | 26.4 | $ | 21.5 | $ | 61.5 | $ | 64.1 | $ | 0.1 | ||||||||||||||
As of December 31, 2016 | ||||||||||||||||||||||||||||
Total assets | $ | 11,300.5 | $ | (107.9 | ) | $ | 4,217.9 | $ | 2,853.4 | $ | 1,178.4 | $ | 2,898.5 | $ | 260.2 | |||||||||||||
Short-term borrowings | $ | 234.4 | $ | — | $ | 77.5 | $ | 3.5 | $ | 55.0 | $ | 98.4 | $ | — | ||||||||||||||
Goodwill | $ | 2,935.8 | $ | — | $ | 1,978.5 | $ | 763.7 | $ | 11.5 | $ | 182.1 | $ | — |
Three Months Ended December 31, | |||||||||
2017 | 2016 | ||||||||
Partnership Adjusted EBITDA | $ | 194.1 | $ | 185.1 | |||||
Depreciation and amortization | (47.4 | ) | (44.6 | ) | |||||
Interest expense | (40.6 | ) | (40.0 | ) | |||||
Loss on extinguishments of debt | — | (33.2 | ) | ||||||
Noncontrolling interest (i) | 1.2 | 1.4 | |||||||
Income before income taxes | $ | 107.3 | $ | 68.7 |
(i) | Principally represents the General Partner’s 1.01% interest in AmeriGas OLP. |
(b) | Includes net pre-tax gains on commodity and certain foreign currency derivative instruments not associated with current-period transactions (including such amounts attributable to noncontrolling interests) totaling $6.6 and $105.5 during the three months ended December 31, 2017 and 2016, respectively. |
(c) | Represents the elimination of intersegment transactions principally among Midstream & Marketing, UGI Utilities and AmeriGas Propane. |
(d) | Represents allowance for funds used during construction (“AFUDC”) associated with our PennEast Pipeline equity investment. |
For the three months ended December 31, | 2017 | 2016 | Variance - Favorable (Unfavorable) | ||||||||||||||||||
(Dollars in millions) | Amount (a) | % of Total | Amount | % of Total | Amount | % Change | |||||||||||||||
AmeriGas Propane (b) | $ | 141.6 | 38.7 | % | $ | 16.6 | 7.2 | % | $ | 125.0 | 753.0 | % | |||||||||
UGI International (c)(d) | 61.1 | 16.7 | % | 88.3 | 38.3 | % | (27.2 | ) | (30.8 | )% | |||||||||||
Midstream & Marketing | 112.0 | 30.6 | % | 29.9 | 13.0 | % | 82.1 | 274.6 | % | ||||||||||||
UGI Utilities | 68.3 | 18.7 | % | 44.3 | 19.2 | % | 24.0 | 54.2 | % | ||||||||||||
Corporate & Other (e) | (17.1 | ) | (4.7 | )% | 51.6 | 22.3 | % | (68.7 | ) | N.M. | |||||||||||
Net income attributable to UGI Corporation | $ | 365.9 | 100.0 | % | $ | 230.7 | 100.0 | % | $ | 135.2 | 58.6 | % |
(a) | Net income attributable to UGI Corporation for the three months ended December 31, 2017, includes income (loss) from one-time adjustments to tax-related accounts as a result of the enactment of the TCJA as follows: |
AmeriGas Propane | $ | 113.1 | |
UGI International | (9.3 | ) | |
Midstream & Marketing | 74.3 | ||
UGI Utilities | 8.1 | ||
Corporate & Other | (20.2 | ) | |
Net income attributable to UGI Corporation | $ | 166.0 |
(b) | Three months ended December 31, 2016, includes net after-tax loss of $5.3 million from extinguishments of debt. |
(c) | Three months ended December 31, 2017, includes beneficial impact of a $17.3 million adjustment to net deferred income tax liabilities associated with a December 2017 change in French income tax rates. Three months ended December 31, 2016, includes beneficial impact of a $27.4 million adjustment to net deferred income tax liabilities associated with a change in French income tax rate and an income tax settlement refund of $6.7 million, plus interest, in France. In addition to these one-time adjustments, net income attributable to UGI for the three months ended December 31, 2017, includes the negative impact of a higher 2018 French corporate income tax rate of $3.9 million (as further described below under “Impact of Changes in U.S. and French Tax Laws”). |
(d) | Includes after-tax integration expenses associated with Finagaz of $1.2 million and $5.3 million for the three months ended December 31, 2017 and 2016, respectively. |
(e) | Includes net after-tax gains on commodity derivative instruments not associated with current-period transactions of $4.6 million and $52.2 million for the three months ended December 31, 2017 and 2016, respectively. Also includes after-tax unrealized gains (losses) on certain foreign currency derivative instruments of $(0.1) million and $0.8 million for the three months ended December 31, 2017 and 2016, respectively. |
For the three months ended December 31, | 2017 | 2016 | Variance - Favorable (Unfavorable) | ||||||||||||||||||
(Dollars in millions) | Amount | % of Total | Amount | % of Total | Amount | % Change | |||||||||||||||
AmeriGas Propane | $ | 28.5 | 15.9 | % | $ | 21.9 | 13.6 | % | $ | 6.6 | 30.1 | % | |||||||||
UGI International | 54.3 | 30.3 | % | 66.2 | 41.1 | % | (11.9 | ) | (18.0 | )% | |||||||||||
Midstream & Marketing | 37.7 | 21.0 | % | 29.9 | 18.6 | % | 7.8 | 26.1 | % | ||||||||||||
UGI Utilities | 60.2 | 33.6 | % | 44.3 | 27.5 | % | 15.9 | 35.9 | % | ||||||||||||
Corporate & Other | (1.4 | ) | (0.8 | )% | (1.4 | ) | (0.8 | )% | — | N.M. | |||||||||||
Adjusted net income attributable to UGI Corporation | $ | 179.3 | 100.0 | % | $ | 160.9 | 100.0 | % | $ | 18.4 | 11.4 | % |
• | a $15.9 million increase in adjusted net income from UGI Utilities; |
• | a $7.8 million increase in adjusted net income from Midstream & Marketing; |
• | a $6.6 million increase in adjusted net income attributable to UGI from AmeriGas Propane; and |
• | an $11.9 million decrease in adjusted net income from UGI International. |
Three Months Ended December 31, 2017 | Total | AmeriGas Propane | UGI International | Midstream & Marketing | UGI Utilities | Corporate & Other | ||||||||||||||||||
Adjusted net income attributable to UGI Corporation (millions): | ||||||||||||||||||||||||
Net income (loss) attributable to UGI Corporation | $ | 365.9 | $ | 141.6 | $ | 61.1 | $ | 112.0 | $ | 68.3 | $ | (17.1 | ) | |||||||||||
Net gains on commodity derivative instruments not associated with current-period transactions (net of tax of $2.1) (a) | (4.6 | ) | — | — | — | — | (4.6 | ) | ||||||||||||||||
Unrealized losses on foreign currency derivative instruments (net of tax of $(0.0)) (a) | 0.1 | — | — | — | — | 0.1 | ||||||||||||||||||
Integration expenses associated with Finagaz (net of tax of $(0.7)) (a) | 1.2 | — | 1.2 | — | — | — | ||||||||||||||||||
Impact of French Finance Bill | (17.3 | ) | — | (17.3 | ) | — | — | — | ||||||||||||||||
Impact from TCJA | (166.0 | ) | (113.1 | ) | 9.3 | (74.3 | ) | (8.1 | ) | 20.2 | ||||||||||||||
Adjusted net income (loss) attributable to UGI Corporation | $ | 179.3 | $ | 28.5 | $ | 54.3 | $ | 37.7 | $ | 60.2 | $ | (1.4 | ) | |||||||||||
Adjusted diluted earnings per share: | ||||||||||||||||||||||||
UGI Corporation earnings (loss) per share — diluted | $ | 2.07 | $ | 0.80 | $ | 0.35 | $ | 0.63 | $ | 0.39 | $ | (0.10 | ) | |||||||||||
Net gains on commodity derivative instruments not associated with current-period transactions | (0.03 | ) | — | — | — | — | (0.03 | ) | ||||||||||||||||
Unrealized losses on foreign currency derivative instruments | — | — | — | — | — | — | ||||||||||||||||||
Integration expenses associated with Finagaz | 0.01 | — | 0.01 | — | — | — | ||||||||||||||||||
Impact of French Finance Bill | (0.10 | ) | — | (0.10 | ) | — | — | — | ||||||||||||||||
Impact from TCJA | (0.94 | ) | (0.64 | ) | 0.05 | (0.42 | ) | (0.05 | ) | 0.12 | ||||||||||||||
Adjusted diluted earnings (loss) per share | $ | 1.01 | $ | 0.16 | $ | 0.31 | $ | 0.21 | $ | 0.34 | $ | (0.01 | ) |
Three Months Ended December 31, 2016 | Total | AmeriGas Propane | UGI International | Midstream & Marketing | UGI Utilities | Corporate & Other | ||||||||||||||||||
Adjusted net income attributable to UGI Corporation (millions): | ||||||||||||||||||||||||
Net income attributable to UGI Corporation | $ | 230.7 | $ | 16.6 | $ | 88.3 | $ | 29.9 | $ | 44.3 | $ | 51.6 | ||||||||||||
Net gains on commodity derivative instruments not associated with current-period transactions (net of tax of $33.3) (a) | (52.2 | ) | — | — | — | — | (52.2 | ) | ||||||||||||||||
Unrealized gains on foreign currency derivative instruments (net of tax of $0.4) (a) | (0.8 | ) | — | — | — | — | (0.8 | ) | ||||||||||||||||
Loss on extinguishments of debt (net of tax of $(3.4)) (a) | 5.3 | 5.3 | — | — | — | — | ||||||||||||||||||
Integration expenses associated with Finagaz (net of tax of $(2.8)) (a) | 5.3 | — | 5.3 | — | — | — | ||||||||||||||||||
Impact from change in French tax rate | (27.4 | ) | — | (27.4 | ) | — | — | — | ||||||||||||||||
Adjusted net income (loss) attributable to UGI Corporation | $ | 160.9 | $ | 21.9 | $ | 66.2 | $ | 29.9 | $ | 44.3 | $ | (1.4 | ) | |||||||||||
Adjusted diluted earnings per share: | ||||||||||||||||||||||||
UGI Corporation earnings per share — diluted | $ | 1.30 | $ | 0.09 | $ | 0.50 | $ | 0.17 | $ | 0.25 | $ | 0.29 | ||||||||||||
Net gains on commodity derivative instruments not associated with current-period transactions | (0.29 | ) | — | — | — | — | (0.29 | ) | ||||||||||||||||
Unrealized gains on foreign currency derivative instruments (b) | (0.01 | ) | — | — | — | — | (0.01 | ) | ||||||||||||||||
Loss on extinguishments of debt | 0.03 | 0.03 | — | — | — | — | ||||||||||||||||||
Integration expenses associated with Finagaz | 0.03 | — | 0.03 | — | — | — | ||||||||||||||||||
Impact from change in French tax rate | (0.15 | ) | — | (0.15 | ) | — | — | — | ||||||||||||||||
Adjusted diluted earnings (loss) per share | $ | 0.91 | $ | 0.12 | $ | 0.38 | $ | 0.17 | $ | 0.25 | $ | (0.01 | ) |
(a) | Income taxes associated with pre-tax adjustments determined using statutory business unit tax rates. |
(b) | Includes the effects of rounding associated with per share amounts. |
For the three months ended December 31, | 2017 | 2016 | Increase (Decrease) | ||||||||||||
(Dollars in millions) | |||||||||||||||
Revenues | $ | 787.3 | $ | 677.2 | $ | 110.1 | 16.3 | % | |||||||
Total margin (a) | $ | 421.2 | $ | 416.5 | $ | 4.7 | 1.1 | % | |||||||
Partnership operating and administrative expenses | $ | 230.3 | $ | 226.8 | $ | 3.5 | 1.5 | % | |||||||
Partnership Adjusted EBITDA (b)(c) | $ | 194.1 | $ | 185.1 | $ | 9.0 | 4.9 | % | |||||||
Operating income (c) (d) | $ | 147.9 | $ | 141.9 | $ | 6.0 | 4.2 | % | |||||||
Retail gallons sold (millions) | 305.0 | 305.7 | $ | (0.7 | ) | (0.2 | )% | ||||||||
Heating degree days—% (warmer) than normal (e) | (1.4 | )% | (10.3 | )% | — | — |
(a) | Total margin represents total revenues less total cost of sales. Total margin for the three months ended December 31, 2017 and 2016 excludes net pre-tax gains of $0.8 million and $25.7 million, respectively, on AmeriGas Propane commodity derivative instruments not associated with current-period transactions. |
(b) | Partnership Adjusted EBITDA should not be considered as an alternative to net income (loss) (as an indicator of operating performance) and is not a measure of performance or financial condition under GAAP. Management uses Partnership Adjusted EBITDA as the primary measure of segment profitability for the AmeriGas Propane segment (see Note 15 to condensed consolidated financial statements). |
(c) | Amounts for the three months ended December 31, 2016, reflect adjustments to correct previously recorded gains on sales of fixed assets ($8.8 million) and decreased depreciation expense ($1.1 million) relating to certain assets acquired with the Heritage Propane acquisition in 2012, which adjustments reduced Partnership Adjusted EBITDA by $8.8 million and reduced operating income by $7.7 million. |
(d) | Operating income reflects certain operating and administrative expenses of the General Partner. |
(e) | Deviation from average heating degree days for the 15-year period 2002-2016 based upon national weather statistics provided by the National Oceanic and Atmospheric Administration (“NOAA”) for 344 Geo Regions in the United States, excluding Alaska and Hawaii. |
For the three months ended December 31, | 2017 | 2016 | Increase (Decrease) | ||||||||||||
(Dollars in millions) | |||||||||||||||
Revenues | $ | 784.2 | $ | 539.1 | $ | 245.1 | 45.5 | % | |||||||
Total margin (a) | $ | 299.4 | $ | 281.1 | $ | 18.3 | 6.5 | % | |||||||
Operating and administrative expenses (b) | $ | 173.9 | $ | 165.6 | $ | 8.3 | 5.0 | % | |||||||
Operating income (b) | $ | 93.1 | $ | 88.9 | $ | 4.2 | 4.7 | % | |||||||
Income before income taxes (b) (c) | $ | 82.6 | $ | 84.0 | $ | (1.4 | ) | (1.7 | )% | ||||||
LPG retail gallons sold (millions) | 263.6 | 254.2 | $ | 9.4 | 3.7 | % | |||||||||
UGI International degree days—% (warmer) colder than normal (d) | (0.9 | )% | 6.6 | % | — | — |
(a) | Total margin represents total revenues less total cost of sales. Total margin for the three months ended December 31, 2017 and 2016 excludes net pre-tax gains of $17.0 million and $15.9 million, respectively, on UGI International commodity derivative instruments not associated with current-period transactions. |
(b) | Reflects impacts of Finagaz integration expenses for the three months ended December 31, 2017 and 2016, of $1.9 million and $8.1 million, respectively. |
(c) | Income before income taxes for the three months ended December 31, 2017 and 2016 excludes net pre-tax unrealized gains (losses) on certain foreign currency derivative contracts of $(0.1) million and $1.2 million, respectively. |
(d) | Deviation from average heating degree days for the 15-year period 2002-2016 at locations in our UGI International service territories. |
For the three months ended December 31, | 2017 | 2016 | Increase | ||||||||||||
(Dollars in millions) | |||||||||||||||
Revenues | $ | 328.0 | $ | 269.8 | $ | 58.2 | 21.6 | % | |||||||
Total margin (a) | $ | 89.0 | $ | 78.0 | $ | 11.0 | 14.1 | % | |||||||
Operating and administrative expenses | $ | 26.7 | $ | 23.0 | $ | 3.7 | 16.1 | % | |||||||
Operating income | $ | 52.3 | $ | 49.7 | $ | 2.6 | 5.2 | % | |||||||
Income before income taxes | $ | 52.6 | $ | 49.1 | $ | 3.5 | 7.1 | % |
(a) | Total margin represents total revenues less total cost of sales. Total margin for the three months ended December 31, 2017 and 2016 excludes net pre-tax gains (losses) of $(11.1) million and $62.6 million, respectively, on Midstream & Marketing commodity derivative instruments not associated with current-period transactions. |
For the three months ended December 31, | 2017 | 2016 | Increase | ||||||||||||
(Dollars in millions) | |||||||||||||||
Revenues | $ | 323.1 | $ | 261.4 | $ | 61.7 | 23.6 | % | |||||||
Total margin (a) | $ | 170.0 | $ | 150.6 | $ | 19.4 | 12.9 | % | |||||||
Operating and administrative expenses | $ | 54.7 | $ | 52.3 | $ | 2.4 | 4.6 | % | |||||||
Operating income | $ | 96.3 | $ | 82.2 | $ | 14.1 | 17.2 | % | |||||||
Income before income taxes | $ | 85.4 | $ | 72.2 | $ | 13.2 | 18.3 | % | |||||||
Gas Utility system throughput—billions of cubic feet (“bcf”) | |||||||||||||||
Core market | 25.5 | 23.0 | 2.5 | 10.9 | % | ||||||||||
Total | 69.2 | 66.2 | 3.0 | 4.5 | % | ||||||||||
Electric Utility distribution sales - millions of kilowatt hours (“gwh”) | 246.6 | 240.6 | 6.0 | 2.5 | % | ||||||||||
Gas Utility heating degree days—% (warmer) than normal (b) | (1.9 | )% | (6.3 | )% | — | — |
(a) | Total margin represents total revenues less total cost of sales and revenue-related taxes, i.e., Electric Utility gross receipts taxes, of $1.3 million during each of the three months ended December 31, 2017 and 2016, respectively. For financial statement purposes, revenue-related taxes are included in “Operating and administrative expenses” on the Condensed Consolidated Statements of Income. |
(b) | Deviation from average heating degree days for the 15-year period 2000-2014 based upon weather statistics provided by NOAA for airports located within Gas Utility’s service territory. |
December 31, 2017 | September 30, 2017 | ||||||||||||||||||||||||||
(Currency in millions) | AmeriGas Propane | UGI International | Midstream & Marketing | UGI Utilities | Other | Total | Total | ||||||||||||||||||||
Short-term borrowings (a) | $ | 263.5 | $ | 41.1 | $ | 100.0 | $ | 181.5 | $ | — | $ | 586.1 | $ | 366.9 | |||||||||||||
Long-term debt (including current maturities): | |||||||||||||||||||||||||||
Senior notes | $ | 2,575.0 | $ | — | $ | — | $ | 675.0 | $ | — | $ | 3,250.0 | $ | 3,250.0 | |||||||||||||
Term loans and notes | — | 825.1 | — | 185.0 | — | 1,010.1 | 902.1 | ||||||||||||||||||||
Other long-term debt | 27.3 | 22.2 | 0.5 | — | 9.2 | 59.2 | 59.8 | ||||||||||||||||||||
Unamortized debt issuance costs | (30.4 | ) | (4.0 | ) | — | (4.4 | ) | — | (38.8 | ) | (39.8 | ) | |||||||||||||||
Total long-term debt | $ | 2,571.9 | $ | 843.3 | $ | 0.5 | $ | 855.6 | $ | 9.2 | $ | 4,280.5 | $ | 4,172.1 | |||||||||||||
Total debt | $ | 2,835.4 | $ | 884.4 | $ | 100.5 | $ | 1,037.1 | $ | 9.2 | $ | 4,866.6 | $ | 4,539.0 |
(a) | Short-term borrowings at UGI International as of December 31, 2017, primarily comprise bank overdrafts at UGI France SAS. |
(Currency in millions) | Total Capacity | Borrowings Outstanding | Letters of Credit and Guarantees Outstanding | Available Borrowing Capacity | ||||||||||||
As of December 31, 2017 | ||||||||||||||||
AmeriGas OLP | $ | 600.0 | $ | 263.5 | $ | 67.2 | $ | 269.3 | ||||||||
UGI International, LLC | € | 300.0 | € | — | € | — | € | 300.0 | ||||||||
UGI France SAS | € | 60.0 | € | — | € | — | € | 60.0 | ||||||||
Flaga (a) | € | 55.0 | € | — | € | 1.0 | € | 54.0 | ||||||||
Energy Services, LLC | $ | 240.0 | $ | 55.0 | $ | — | $ | 185.0 | ||||||||
UGI Utilities | $ | 300.0 | $ | 181.5 | $ | 2.0 | $ | 116.5 | ||||||||
As of December 31, 2016 | ||||||||||||||||
AmeriGas OLP | $ | 525.0 | $ | 77.5 | $ | 67.2 | $ | 380.3 | ||||||||
UGI France SAS | € | 60.0 | € | — | € | — | € | 60.0 | ||||||||
Flaga (a) | € | 55.0 | € | — | € | 8.0 | € | 47.0 | ||||||||
Energy Services, LLC | $ | 240.0 | $ | 20.0 | $ | — | $ | 220.0 | ||||||||
UGI Utilities | $ | 300.0 | $ | 98.4 | $ | 2.0 | $ | 199.6 |
(a) | Total capacity comprises a €25 million multi-currency revolving credit facility, a €5 million overdraft facility and a €25 million guarantee facility. Guarantees outstanding reduce the available capacity on the €25 million guarantee facility. |
For the three months ended December 31, 2017 | For the three months ended December 31, 2016 | |||||||||||||||
(Currency in millions) | Average | Peak | Average | Peak | ||||||||||||
AmeriGas OLP | $ | 199.0 | $ | 286.0 | $ | 191.6 | $ | 292.5 | ||||||||
UGI International, LLC | € | — | € | — | € | — | € | — | ||||||||
UGI France SAS | € | — | € | — | € | — | € | — | ||||||||
Flaga | € | — | € | — | € | — | € | — | ||||||||
Energy Services, LLC | $ | 44.7 | $ | 79.0 | $ | 18.3 | $ | 28.0 | ||||||||
UGI Utilities | $ | 168.1 | $ | 205.0 | $ | 96.6 | $ | 137.0 |
(1) | a $180.3 million reduction in net deferred tax liabilities in the U.S from the reduction of the U.S. tax rate; |
(2) | the establishment of $12.6 million of valuation allowances related to deferred tax assets impacted by U.S. tax law changes; and |
(3) | a $1.7 million “toll tax” on un-repatriated foreign earnings. |
(a) | Evaluation of Disclosure Controls and Procedures |
(b) | Change in Internal Control over Financial Reporting |
Period | (a) Total Number of Shares Purchased | (b) Average Price Paid per Share (or Unit) | (c) Total Number of Shares (or Units) Purchased as Part of Publicly Announced Plans or Programs (1) | (d) Maximum Number (or Approximate Dollar Value) of Shares (or Units) that May Yet Be Purchased Under the Plans or Programs | ||||
October 1, 2017 to October 31, 2017 | — | — | — | 10.62 million | ||||
November 1, 2017 to November 30, 2017 | — | — | — | 10.62 million | ||||
December 1, 2017 to December 31, 2017 | 202,500 | $46.82 | 202,500 | 10.42 million | ||||
Total | 202,500 | 202,500 |
(1) | In January 2014, the UGI Board of Directors authorized a share repurchase program for up to 15 million shares of UGI Corporation Common Stock. The authorization permitted the execution of the share repurchase program over a four-year period, expiring in January 2018. On January 25, 2018, the UGI Board of Directors authorized an extension of the share repurchase program for up to 8 million shares of UGI Corporation Common Stock for an additional four-year period. |
Exhibit No. | Exhibit | Registrant | Filing | Exhibit | ||||
10.1 | ||||||||
10.2 | AmeriGas Partners, L.P. | Form 8-K (12/15/2017) | 10.1 | |||||
31.1 | ||||||||
31.2 | ||||||||
32 | ||||||||
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101.PRE | XBRL Taxonomy Extension Presentation Linkbase |
10.1 | ||
31.1 | ||
31.2 | ||
32 | ||
101.INS | XBRL Instance | |
101.SCH | XBRL Taxonomy Extension Schema | |
101.CAL | XBRL Taxonomy Extension Calculation Linkbase | |
101.DEF | XBRL Taxonomy Extension Definition Linkbase | |
101.LAB | XBRL Taxonomy Extension Labels Linkbase | |
101.PRE | XBRL Taxonomy Extension Presentation Linkbase |
UGI Corporation | |||
(Registrant) | |||
Date: | February 6, 2018 | By: | /s/ Kirk R. Oliver |
Kirk R. Oliver | |||
Chief Financial Officer | |||
Date: | February 6, 2018 | By: | /s/ Marie-Dominique Ortiz-Landazabal |
Marie-Dominique Ortiz-Landazabal | |||
Vice President - Accounting and Financial Control | |||
and Chief Accounting Officer |
€300,000,000 MULTICURRENCY REVOLVING FACILITY AGREEMENT |
UGI INTERNATIONAL, LLC as Borrower |
NATIXIS BNP PARIBAS CREDIT AGRICOLE CORPORATE AND INVESTMENT BANK HSBC FRANCE ING BANK N.V., FRENCH BRANCH MEDIOBANCA INTERNATIONAL (LUXEMBOURG) S.A. as Mandated Lead Arrangers with |
NATIXIS as Coordinator |
NATIXIS as Agent and Security Agent |
Page | |||
1. | DEFINITIONS AND INTERPRETATION | 1 | |
2. | THE FACILITY | 25 | |
3. | PURPOSE | 27 | |
4. | CONDITIONS OF UTILISATION | 27 | |
5. | UTILISATION | 28 | |
6. | REPAYMENT | 29 | |
7. | PREPAYMENT AND CANCELLATION | 30 | |
8. | INTEREST | 33 | |
9. | INTEREST PERIODS | 35 | |
10. | CHANGES TO THE CALCULATION OF INTEREST | 36 | |
11. | FEES | 37 | |
12. | TAX GROSS UP AND INDEMNITIES | 38 | |
13. | INCREASED COSTS | 41 | |
14. | OTHER INDEMNITIES | 43 | |
15. | MITIGATION BY THE LENDERS | 44 | |
16. | COSTS AND EXPENSES | 45 | |
17. | REPRESENTATIONS | 46 | |
18. | INFORMATION UNDERTAKINGS | 51 | |
19. | FINANCIAL COVENANT | 56 | |
20. | GENERAL UNDERTAKINGS | 56 | |
21. | EVENTS OF DEFAULT | 63 | |
22. | CHANGES TO THE LENDERS | 67 | |
23. | CHANGES TO THE BORROWER | 71 | |
24. | ROLE OF THE AGENT, THE SECURITY AGENT AND THE MANDATED LEAD ARRANGERS | 72 | |
25. | CONDUCT OF BUSINESS BY THE FINANCE PARTIES | 79 | |
26. | SHARING AMONG THE FINANCE PARTIES | 80 | |
27. | PAYMENT MECHANICS | 82 | |
28. | SET-OFF | 85 | |
29. | NOTICES | 85 | |
30. | CALCULATIONS AND CERTIFICATES | 87 | |
31. | PARTIAL INVALIDITY | 87 | |
32. | REMEDIES AND WAIVERS | 87 | |
33. | AMENDMENTS AND WAIVERS | 87 | |
34. | CONFIDENTIAL INFORMATION | 89 | |
35. | CONFIDENTIALITY OF FUNDING RATES | 92 | |
36. | COUNTERPARTS | 94 | |
37. | GOVERNING LAW | 95 | |
38. | ENFORCEMENT | 95 | |
SCHEDULE 1. THE ORIGINAL LENDERS | 96 | ||
SCHEDULE 2. CONDITIONS PRECEDENT | 97 | ||
SCHEDULE 3. REQUESTS | 104 | ||
SCHEDULE 4. FORM OF ASSIGNMENT AGREEMENT | 107 |
SCHEDULE 5. FORM OF COMPLIANCE AGREEMENT | 110 | ||
SCHEDULE 6. EXISTING SECURITY | 111 | ||
SCHEDULE 7. TIMETABLES | 112 | ||
SCHEDULE 8. FORM OF INCREASE CONFIRMATION | 113 |
(1) | UGI INTERNATIONAL, LLC, a limited liability company, incorporated under the laws of Pennsylvania, located at 460 North Gulph Road, King of Prussia, Pennsylvania, 19406, USA and represented by duly authorised signatories for the purpose of this Agreement (the "Borrower"); |
(2) | NATIXIS, a société anonyme, incorporated under the laws of France under registration number 542 044 524 RCS Paris, having its registered office at 30, avenue Pierre Mendès France 75013 Paris, and represented by duly authorised signatories for the purpose of this Agreement, as mandated lead arranger and bookrunner of the Facility (a "Mandated Lead Arranger" and a "Bookrunner"); |
(3) | THE FINANCIAL INSTITUTIONS listed in Part II and Part III of Schedule 1 as lenders (the "Original Lenders"); |
(4) | NATIXIS, in its capacity as agent and coordinator for the Lenders under the Finance Documents (the "Agent" and the "Coordinator"); and |
(5) | NATIXIS, in its capacity as agent for the Finance Parties under the French Pledge (the "Security Agent"). |
1.1 | Definitions |
(a) | the Agent's spot rate of exchange; or |
(b) | (if the Agent does not have an available spot rate of exchange) any other publicly available spot rate of exchange selected by the Agent (acting reasonably), |
(a) | in respect of any Capital Lease of any person, the capitalised amount thereof that would appear on a balance sheet of such person prepared as of such date in accordance with GAAP; and |
(b) | in respect of any Synthetic Lease, the capitalised amount or principal amount of the remaining lease payments under the relevant lease that would appear on a balance sheet of such person prepared as of such date in accordance with GAAP if such lease were accounted for as a Capital Lease. |
(a) | the Base Currency Amount of its participation in any outstanding Loans; and |
(b) | in relation to any proposed Utilisation, the Base Currency Amount of its participation in any other Loans that are due to be made on or before the proposed Utilisation Date, |
(a) | the interest excluding the Margin which a Lender should have received for the period from the date of receipt of all or any part of its participation in a Loan or Unpaid Sum to the last day of the current Interest Period in respect of that Loan or Unpaid Sum, had the principal amount or Unpaid Sum received been paid on the last day of that Interest Period; |
(b) | the amount which that Lender would be able to obtain by placing an amount equal to the principal amount or Unpaid Sum received by it on deposit with a leading bank for a period starting on the Business Day following receipt or recovery and ending on the last day of the current Interest Period. |
(a) | in relation to an Original Lender, the amount in the Base Currency set opposite its name under the heading "Commitment" in Part I or Part II of Schedule 1 (The Original Lenders) and the amount of any other Commitment transferred to it under this Agreement or assumed by it in accordance with Clause 2.2 (Increase); and |
(b) | in relation to any other Lender, the amount in the Base Currency of any Commitment transferred to it under this Agreement or assumed by it in accordance with Clause 2.2 (Increase), |
(a) | any member of the Group or any of its advisers; or |
(b) | another Finance Party, if the information was obtained by that Finance Party directly or indirectly from any member of the Group or any of its advisers, |
(i) | information that: |
(A) | is or becomes public information other than as a direct or indirect result of any breach by that Finance Party of Clause 34 (Confidential Information); or |
(B) | is identified in writing at the time of delivery as non-confidential by any member of the Group or any of its advisers; or |
(C) | is known by that Finance Party before the date the information is disclosed to it in accordance with paragraphs (a) or (b) above or is lawfully obtained by that Finance Party after that date, from a source which is, as far as that Finance Party is aware, unconnected with the Group and which, in either case, as far as that Finance Party is aware, has not been obtained in breach of, and is not otherwise subject to, any obligation of confidentiality; and |
(ii) | any Funding Rate. |
(a) | Consolidated Net Income for such period; |
(b) | the sum of the following, without duplication, to the extent deducted in determining Consolidated Net Income: (i) Consolidated Interest Expense, (ii) Consolidated Income Tax Expense, and (iii) depreciation and amortisation of property, plant and equipment and intangible assets, in each case for such period. |
(i) | net after-tax extraordinary gains or losses; |
(ii) | net after-tax gains or losses attributable to Permitted Disposals; |
(iii) | the net income or loss of any person which is not a Subsidiary of the Borrower and which is accounted for by the equity method of accounting; provided, that Consolidated Net Income shall include the amount of dividends or distributions actually paid to the Borrower or any Subsidiary of the Borrower; |
(iv) | the net income of any Subsidiary of the Borrower to the extent that dividends or distributions of such net income are not at the date of determination permitted by the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or other regulation; |
(v) | the net after-tax gains or losses attributable to the early extinguishment of Indebtedness; |
(vi) | the net after-tax gains or losses attributable to the early termination of any Hedge Agreement; |
(vii) | unrealised gains or losses attributable to any Hedge Agreement; and |
(viii) | the cumulative effect of any changes in accounting principles. |
(a) | which has failed to make its participation in a Loan available (or has notified the Agent that it will not make its participation in a Loan available) by the Utilisation Date of that Loan in accordance with Clause 5.4 (Lenders' participation); |
(b) | which has otherwise rescinded or repudiated a Finance Document; or |
(c) | with respect to which an Insolvency Event has occurred and is continuing, |
(i) | its failure to pay, is caused by: |
(A) | administrative or technical error; or |
(B) | a Disruption Event, and |
(ii) | the Lender is disputing in good faith whether it is contractually obliged to make the payment in question. |
(a) | a material disruption to those payment or communications systems or to those financial markets which are, in each case, required to operate in order for payments to be made in connection with the Facility (or otherwise in order for the transactions contemplated by the Finance Documents to be carried out) which disruption is not caused by, and is beyond the control of, any of the Parties; or |
(b) | the occurrence of any other event which results in a disruption (of a technical or systems-related nature) to the treasury or payments operations of a Party preventing that, or any other Party: |
(i) | from performing its payment obligations under the Finance Documents; or |
(ii) | from communicating with other Parties in accordance with the terms of the Finance Documents, |
(a) | air (including, without limitation, air within natural or man-made structures, whether above or below ground); |
(b) | water (including, without limitation, territorial, coastal and inland waters, water under or within land and water in drains and sewers); and |
(c) | land (including, without limitation, land under water). |
(a) | the pollution or protection of the Environment; |
(b) | the conditions of the workplace; or |
(c) | the generation, handling, storage, use, release or spillage of any substance which, alone or in combination with any other, is capable of causing harm to the Environment, including, without limitation, any waste. |
(a) | (i) the occurrence of a reportable event, within the meaning of Section 4043 of ERISA, with respect to any Employee Plan unless the 30 day notice requirement with respect to such event has been waived or (ii) the requirements of Section 4043(b) of ERISA apply with respect to a contributing sponsor, as defined in Section 4001(a)(13) of ERISA, of an Employee Plan, and an event described in paragraph (9), (10), (11), (12) or (13) of Section 4043(c) of ERISA is reasonably expected to occur with respect to such Employee Plan within the following 30 days, unless the notice requirement with respect to such event has been waived; |
(b) | the application for a minimum funding waiver under Section 302 (c) of ERISA with respect to an Employee Plan; |
(c) | the provision by the administrator of any Employee Plan of a notice of intent to terminate such Employee Plan, pursuant to Section 4041(a)(2) of ERISA (including any such notice with respect to a plan amendment referred to in Section 4041(e) of ERISA) , other than in connection with a "standard termination", as described in Section 4041(b) of ERISA, of the Employee Plan; |
(d) | the cessation of operations at a facility of any Obligor or any ERISA Affiliate affecting an Employee Plan in the circumstances described in Section 4062(e) of ERISA; |
(e) | the incurrence by any Obligor or ERISA Affiliate of any liability with respect to the withdrawal or partial withdrawal by any Obligor or any ERISA Affiliate from a Multiple Employer Plan pursuant to Section 4063 or 4064 of ERISA; |
(f) | the institution by the PBGC of proceedings to terminate an Employee Plan pursuant to Section 4042 of ERISA, or the occurrence of any event or condition described in Section |
(g) | the failure of a U.S. Obligor or any of its ERISA Affiliates to make by its due date a required contribution with respect to any Employee Plan; or (ii) any required contribution to a Multiemployer Plan; or |
(h) | the incurrence or expected incurrence by any Obligor or ERISA Affiliate of any liability under Title IV of ERISA with respect to any Employee Plan or Multiemployer Plan, other than for premiums that are duly paid. |
(a) | the applicable Screen Rate as of the Specified Time for euro and for a period equal in length to the Interest Period of that Loan; or |
(b) | as otherwise determined pursuant to Clause 10.1 (Unavailability of Screen Rate), |
(a) | in respect of a Lender, the office or offices notified by that Lender to the Agent in writing on or before the date it becomes a Lender (or, following that date, by not less than five (5) Business Days' written notice) as the office or offices through which it will perform its obligations under this Agreement; or |
(b) | in respect of any other Finance Party, the office in the jurisdiction in which it is resident for tax purposes. |
(a) | sections 1471 to 1474 of the Code, as of the Signing Date (or any amended or successor version that is substantially comparable and not materially more onerous to comply with) or any associated regulations; |
(b) | any treaty, law or regulation of any other jurisdiction, or relating to an intergovernmental agreement between the US and any other jurisdiction, which (in either case) facilitates the implementation of any law or regulation referred to in paragraph (a) above; or |
(c) | any agreement pursuant to the implementation of any treaty, law or regulation referred to in paragraphs (a) or (b) above with the US Internal Revenue Service, the US government or any governmental or taxation authority in any other jurisdiction. |
(a) | in relation to a "withholdable payment" described in section 1473(1)(A)(i) of the Code (which relates to payments of interest and certain other payments from sources within the US), 1 July 2014; |
(b) | in relation to a "withholdable payment" described in section 1473(1)(A)(ii) of the Code (which relates to "gross proceeds" from the disposition of property of a type that can produce interest from sources within the US), 1 January 2019; or |
(c) | in relation to a "passthru payment" described in section 1471(d)(7) of the Code not falling within paragraphs (a) or (b) above, 1 January 2019, |
(a) | to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or other obligation (whether arising by virtue of partnership arrangements, by agreement to keep well, to purchase assets, goods, securities or services, to take-or-pay, or to maintain financial statement condition or otherwise); |
(b) | entered into for the purpose of assuring in any other manner the obligee of such Indebtedness or other obligation of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part); or |
(c) | to purchase any materials, supplies or other property from, or to obtain the services of, another person if the relevant contract or other related document or obligation requires that payment for such materials, supplies or other property, or for such services, shall be made regardless of whether delivery of such materials, supplies or other property is ever made or tendered, or such services are ever performed or tendered, |
(a) | all liabilities, obligations and indebtedness for borrowed money including, but not limited to, obligations evidenced by bonds, debentures, notes or other similar instruments of any such person; |
(b) | all obligations to pay the deferred purchase price of property or services of any such person, except (i) trade payables arising in the ordinary course of business not more than ninety (90) days past due, or (ii) that are currently being contested in good faith by appropriate proceedings and with respect to which reserves in conformity with GAAP have been provided for on the books of such person; |
(c) | the Attributable Indebtedness of such person with respect to such person's obligations in respect of Capital Leases and Synthetic Leases (regardless of whether accounted for as indebtedness under GAAP); |
(d) | all obligations of such person under conditional sale or other title retention agreements relating to property purchased by such person to the extent of the value of such property (other than customary reservations or retentions of title under agreements with suppliers entered into in the ordinary course of business); |
(e) | all Indebtedness of any other person secured by a lien on any asset owned or being purchased by such person (including indebtedness arising under conditional sales or other title retention agreements except trade payables arising in the ordinary course of business), whether or not such indebtedness shall have been assumed by such person or is limited in recourse; |
(f) | all obligations, contingent or otherwise, of any such person relative to the face amount of letters of credit, whether or not drawn, including any reimbursement obligation, and banker's acceptances issued for the account of any such person; |
(g) | all Net Hedging Obligations of any such person; |
(h) | the outstanding attributed principal amount under any asset securitisation program of any such person to the extent recourse to such person or any of its Subsidiaries; and |
(i) | all Guaranty Obligations of any such person with respect to any of the foregoing. |
(i) | the Indebtedness of any person shall include the Indebtedness of any partnership or joint venture (other than a joint venture that is itself a corporation or limited |
(ii) | any Shareholder Advance shall not be treated as Indebtedness for any purpose provided it is subordinated to the satisfaction of the Finance Parties. |
(a) | is dissolved (other than pursuant to a consolidation, amalgamation or merger); |
(b) | admits in writing its inability generally to pay its debts as they become due; |
(c) | makes a general assignment, arrangement or composition with or for the benefit of its creditors; |
(d) | institutes or has instituted against it, by a regulator, supervisor or any similar official with primary insolvency, rehabilitative or regulatory jurisdiction over it in the jurisdiction of its incorporation or organisation or the jurisdiction of its head or home office, a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors' rights, or a petition is presented for its winding-up or liquidation by it or such regulator, supervisor or similar official; |
(e) | has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors' rights, or a petition is presented for its winding-up or liquidation, and, in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition is instituted or presented by a person or entity not described in paragraph (d) above and: |
(i) | results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation; or |
(ii) | is not dismissed, discharged, stayed or restrained in each case within 30 days of the institution or presentation thereof; |
(f) | has exercised in respect of it one or more of the stabilisation powers pursuant to Part 1 of the Banking Act 2009 and/or has instituted against it a bank insolvency proceeding pursuant to Part 2 of the Banking Act 2009 or a bank administration proceeding pursuant to Part 3 of the Banking Act 2009; |
(g) | has a resolution passed for its winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); |
(h) | seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all its assets (other than, for so long as it is required by law or regulation not to be publicly disclosed, any such appointment which is to be made, or is made, by a person or entity described in paragraph (d) above); |
(i) | has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on |
(j) | causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in paragraphs (a) to (i) above; or |
(k) | takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts. |
(a) | any patents, trademarks, service marks, designs, business names, copyrights, database rights, design rights, domain names, moral rights, inventions, confidential information, knowhow and other intellectual property rights and interests (which may now or in the future subsist), whether registered or unregistered; and |
(b) | the benefit of all applications and rights to use such assets of each member of the Group (which may now or in the future subsist). |
(a) | the most recent applicable Screen Rate for the longest period (for which that Screen Rate is available) which is less than the Interest Period of that Loan; and |
(b) | the most recent applicable Screen Rate for the shortest period (for which that Screen Rate is available) which exceeds the Interest Period of that Loan, |
(a) | the applicable Screen Rate for the longest period (for which that Screen Rate is available) which is less than the Interest Period of that Loan; and |
(b) | the applicable Screen Rate for the shortest period (for which that Screen Rate is available) which exceeds the Interest Period of that Loan, |
(a) | the principle that equitable remedies may be granted or refused at the discretion of a court and the limitation of enforcement by laws relating to insolvency, reorganisation and other laws generally affecting the rights of creditors; |
(b) | the time barring of claims under the Limitation Acts, the possibility that an undertaking to assume liability for or indemnify a person against non-payment of UK stamp duty may be void and defences of set-off or counterclaim; |
(c) | similar principles, rights and defences under the laws of any Relevant Jurisdiction; and |
(d) | any other matters which are set out as qualifications or reservations as to matters of law of general application in the Legal Opinions. |
(a) | any Original Lender; and |
(b) | any bank, financial institution, trust, fund or other entity which has become a Party as a "Lender" in accordance with Clause 2.2 (Increase) or Clause 22 (Changes to the Lenders), |
(a) | the applicable Screen Rate as of the Specified Time for the currency of that Loan and for a period equal in length to the Interest Period of that Loan; or |
(b) | as otherwise determined pursuant to Clause 10.1 (Unavailability of Screen Rate), |
(a) | in relation to any Loan in the Base Currency, one point seventy five per cent (1.75%) per annum; and |
(b) | in relation to any Loan in the Optional Currency, two per cent (2%) per annum, |
(a) | is materially adverse to: |
(i) | the business, assets or financial condition of the Group taken as a whole; or |
(ii) | the ability of the Borrower to perform its payment obligations under any of the Finance Documents or to comply with Clause 19 (Financial Covenant); or |
(b) | results in the French Pledge not providing to any beneficiaries security over the assets expressed to be secured under the French Pledge or which materially adversely affects the validity or enforceability of the security expressed to be provided for under the French Pledge. |
(a) | any Obligor; |
(b) | any member of the Group whose Consolidated EBITDA exceeds ten per cent (10%) of the Consolidated EBITDA of the Group; and |
(c) | any other member of the Group to be included as necessary to ensure that at all times the Borrower and the Material Subsidiaries represent more than seventy per cent (70%) of the Consolidated EBITDA of the Group. |
(a) | (subject to paragraph (c) below) if the numerically corresponding day is not a Business Day, that period shall end on the next Business Day in that calendar month in which that period is to end if there is one, or if there is not, on the immediately preceding Business Day; |
(b) | if there is no numerically corresponding day in the calendar month in which that period is to end, that period shall end on the last Business Day in that calendar month; and |
(c) | if an Interest Period begins on the last Business Day of a calendar month, that Interest Period shall end on the last Business Day in the calendar month in which that Interest Period is to end. |
(a) | the unaudited unconsolidated financial statements of the Borrower for the Financial Year ended 30 September 2016; |
(b) | the unaudited and consolidated financial statements of the Group (consisting of consolidated balance sheets, income statements, cash flow statements and equity statements) for the Financial Year ending 30 September 2014, 30 September 2015 and 30 September 2016; and |
(c) | the Half-Year Accounts of the Group for accounting half-year ended on 31 March 2017 and 30 September 2017. |
(a) | the company or the business which is the subject of such investment carries on business activities which are related, ancillary, similar or complementary to those carried on by the Group; |
(b) | with respect to any investment with an Enterprise Value of at least one hundred and fifty million euro (EUR 150,000,000) (or its equivalent in any other currency), an Authorised Representative certifies to the Finance Parties (such certificate to contain calculations in reasonable detail and delivered to the Agent at least five (5) Business Days prior to the date on which the investment is completed) that the Consolidated Total Net Leverage Ratio as calculated on a Pro Forma Basis on the Testing Date which immediately precedes the date on which the investment is completed, shall not be greater than 3.5x (taking into account the investment and in the event of an acquisition of at least fifty per cent (50%) of the Capital Stock in a target, Permitted Acquisition Costs Savings and Synergies); and |
(c) | no acquisitions shall be permitted to be made in a Sanctioned Country or in a target who is engaged in in any transaction, activity or conduct that would violate Sanctions, |
(a) | by a member of the Group to another member of the Group; or |
(b) | by a member of the Group to an entity which is not a member of the Group, if following such disposal the Consolidated Total Net Leverage Ratio on a Pro Forma Basis is less than or equal to 3.5x. |
(a) | merger between two members of the Group; or |
(b) | any other merger, amalgamation or consolidation, so long as no Event of Default has occurred or is continuing before or after such event and provided that following such merger, amalgamation or consolidation the Consolidated Total Net Leverage Ratio on a Pro Forma Basis is less than or equal to 3.5x, |
(a) | income statement items (whether positive or negative) attributable to the Property or person subject to such Specified Transaction, (i) in the case of a disposition of all or substantially all of the Capital Stock of a Subsidiary or any division, business unit, product line or line of business, shall be excluded and (ii) in the case of a Permitted Acquisition, shall be included only in accordance with the definition of Permitted Acquisition; |
(b) | any retirement of Indebtedness; and |
(c) | any Indebtedness incurred or assumed by the Borrower, as applicable, or any of its Subsidiaries in connection therewith and if such Indebtedness has a floating or formula rate, shall have an implied rate of interest for the applicable period for purposes of this definition determined by utilising the rate that is or would be in effect with respect to such Indebtedness as at the relevant date of determination, |
(a) | any freehold, leasehold or moveable property: and |
(b) | any buildings, fixtures, fittings, fixed plant or machinery from time to time situated on or forming part of that freehold, leasehold or immovable property. |
(a) | (in respect of the Base Currency) two (2) TARGET Days before the first day of that period; or |
(b) | (in respect of the Optional Currency), two (2) Business Days before the first day of that period, |
(a) | its Original Jurisdiction; |
(b) | any jurisdiction where any asset subject to or intended to be subject to the Security to be created by it pursuant to the French Pledge is situated; and |
(c) | any jurisdiction where it conducts its business. |
(a) | made or to be made on the same day that a maturing Loan is due to be repaid; |
(b) | the aggregate amount of which is equal to or less than the amount of the maturing Loan; |
(c) | in the same currency as the maturing Loan; and |
(d) | made or to be made to the Borrower for the purpose of refinancing that maturing Loan. |
(a) | in relation to LIBOR, the London interbank offered rate administered by ICE Benchmark Administration Limited (or any other person which takes over the administration of that rate) for the relevant currency and period displayed (before any correction, recalculation or republication by the administrator) on pages LIBOR01 or LIBOR02 of the Thomson Reuters screen (or any replacement Thomson Reuters page which displays that rate); and |
(b) | in relation to EURIBOR, the euro interbank offered rate administered by the European Money Markets Institute (or any other person which takes over the administration of that rate) for the relevant period displayed (before any correction, recalculation or republication by the administrator) on page EURIBOR01 of the Thomson Reuters screen (or any replacement Thomson Reuters page which displays that rate), |
(a) | any disposition of all or substantially all of the assets or Capital Stock of any Subsidiary of the Borrower or any division, business unit, product line or line of business provided that such disposition is a Permitted Disposal; and |
(b) | any Permitted Acquisition. |
(a) | for any date on or after the date such Hedge Agreements have been closed out and termination value(s) determined in accordance therewith, such termination value(s); and |
(b) | for any date prior to the date referenced in (a), the amount(s) determined as the mark-to-market value(s) for such Hedge Agreements, as determined based upon one or more mid-market or other readily available quotations provided by any recognised dealer in such Hedge Agreements. |
(a) | the proposed Transfer Date specified in the relevant Assignment Agreement or Transfer Certificate; and |
(b) | the date on which the Agent executes the relevant Assignment Agreement or Transfer Certificate. |
1.2 | Construction |
(i) | the "Agent", the "Bookrunner", the "Mandated Lead Arranger", any "Finance Party", any "Lender", any "Obligor", any "Party", any "Secured Party", the "Security Agent" or any other person shall be construed so as to include its successors in title, permitted assigns and permitted transferees to, or of, its rights and/or obligations under the Finance Documents and, in the case of the Security Agent, any person for the time being appointed as Security Agent or Security Agents in accordance with the Finance Documents; |
(ii) | a document in "agreed form" is a document which is previously agreed in writing by or on behalf of the Borrower and the Agent or, if not so agreed, is in the form specified by the Agent; |
(iii) | "assets" includes present and future properties, revenues and rights of every description; |
(iv) | a "Finance Document" or any other agreement or instrument is a reference to that Finance Document or other agreement or instrument as amended, novated, supplemented, extended or restated; |
(v) | a "group of Lenders" includes all the Lenders; |
(vi) | "indebtedness" includes any obligation (whether incurred as principal or as surety) for the payment or repayment of money, whether present or future, actual or contingent; |
(vii) | a "person" includes any individual, firm, company, corporation, government, state or agency of a state or any association, trust, joint venture, consortium, partnership or other entity (whether or not having separate legal personality); |
(viii) | a "regulation" includes any regulation, rule, official directive, request or guideline (whether or not having the force of law but if not having the force of law, which is generally complied with by those to whom it is addressed) of any governmental, intergovernmental or supranational body, agency, department or of any regulatory, self-regulatory or other authority or organisation; |
(ix) | a provision of law is a reference to that provision as amended or re-enacted; and |
(x) | a time of day is a reference to London time. |
1.3 | Currency symbols and definitions |
1.4 | Third party rights |
2. | THE FACILITY |
2.1 | The Facility |
2.2 | Increase |
(i) | Clause 7.1 (Illegality) or Clause 7.6 (Right of cancellation in relation to a Defaulting Lender); or |
(ii) | paragraph (a) of Clause 7.5 (Right of replacement or repayment and cancellation in relation to a single Lender), |
(A) | the increased Commitments will be assumed by one or more Eligible Institutions (each an "Increase Lender") each of which confirms in writing (whether in the relevant Increase Confirmation or otherwise) its willingness to assume and does assume all the obligations of a Lender corresponding to that part of the increased Commitments which it is to assume, as if it had been an Original Lender in respect of those Commitments; |
(B) | each of the Obligors and any Increase Lender shall assume obligations towards one another and/or acquire rights against one another as the Obligors and the Increase Lender would have assumed and/or acquired had the |
(C) | each Increase Lender shall become a Party as a "Lender" and any Increase Lender and each of the other Finance Parties shall assume obligations towards one another and acquire rights against one another as that Increase Lender and those Finance Parties would have assumed and/or acquired had the Increase Lender been an Original Lender in respect of that part of the increased Commitments which it is to assume; |
(D) | the Commitments of the other Lenders shall continue in full force and effect; and |
(E) | any increase in the Commitments shall take effect on the date specified by the Borrower in the notice referred to above or any later date on which the Agent executes an otherwise duly completed Increase Confirmation delivered to it by the relevant Increase Lender. |
(i) | an "Existing Lender" were references to all the Lenders immediately prior to the relevant increase; |
(ii) | the "New Lender" were references to that "Increase Lender"; and |
(iii) | a "re-transfer" and "re-assignment" were references to respectively a "transfer" and "assignment". |
2.3 | Finance Parties' rights and obligations |
3. | PURPOSE |
3.1 | Purpose |
3.2 | Monitoring |
4. | CONDITIONS OF UTILISATION |
4.1 | Initial conditions precedent |
4.2 | Further conditions precedent |
4.3 | Maximum number of Loans |
5. | UTILISATION |
5.1 | Delivery of a Utilisation Request |
5.2 | Completion of a Utilisation Request |
(i) | the proposed Utilisation Date is a Business Day within the Availability Period; |
(ii) | the currency and amount of the Utilisation comply with Clause 5.3 (Currency and amount); and |
(iii) | the proposed Interest Period complies with Clause 9 (Interest Periods). |
5.3 | Currency and amount |
(i) | if the currency selected is the Base Currency, a minimum of EUR 5,000,000 (five million euro) or, if less, the Available Facility; or |
(ii) | if the currency selected is the Optional Currency, a minimum of USD 5,000,000 (five million dollars) or, if less, the Available Facility; and |
(iii) | in any event such that its Base Currency Amount is less than or equal to the Available Facility. |
5.4 | Lenders' participation |
5.5 | Cancellation of Commitment |
6. | REPAYMENT |
6.1 | Repayment of Loans |
(i) | one or more Loans are to be made available to the Borrower: |
(A) | on the same day that a maturing Loan is due to be repaid by that Borrower; |
(B) | in the same currency as the maturing Loan; and |
(C) | in whole or in part for the purpose of refinancing the maturing Loan; and |
(ii) | the proportion borne by each Lender's participation in the maturing Loan to the amount of that maturing Loan is the same as the proportion borne by that Lender's participation in the new Loans to the aggregate amount of those new Loans, |
(D) | if the amount of the maturing Loan exceeds the aggregate amount of the new Loans: |
(1) | the Borrower will only be required to make a payment under Clause 27.1 (Payments to the Agent) in an amount in the relevant currency equal to that excess; and |
(2) | each Lender's participation in the new Loans shall be treated as having been made available and applied by the Borrower in or towards repayment of that Lender's participation in the maturing Loan and that Lender will not be required to make a payment under Clause 27.1 (Payments to the Agent) in respect of its participation in the new Loans; and |
(E) | if the amount of the maturing Loan is equal to or less than the aggregate amount of the new Loans: |
(1) | the Borrower will not be required to make a payment under Clause 27.1 (Payments to the Agent); and |
(2) | each Lender will be required to make a payment under Clause 27.1 (Payments to the Agent) in respect of its participation in the new Loans only to the extent that its participation in the new Loans exceeds that Lender's participation in the maturing Loan and the remainder of that Lender's participation in the new Loans shall be treated as having been made available and applied by the Borrower in or towards repayment of that Lender's participation in the maturing Loan. |
7. | PREPAYMENT AND CANCELLATION |
7.1 | Illegality |
7.2 | Change of control and sale |
(i) | the Borrower shall promptly notify the Agent upon becoming aware of that event; |
(ii) | a Lender shall not be obliged to fund a Utilisation (except for a Rollover Loan); |
(iii) | the Agent shall, by not less than five (5) Business Days' notice to the Borrower, cancel the Total Commitments and declare all outstanding Loans, together with accrued interest, and all other amounts accrued under the Finance Documents immediately due and payable, whereupon the Total Commitments will be cancelled |
(i) | ceases to hold, directly or indirectly, at least fifty one per cent (51%) of the issued share capital of the Borrower; or |
(ii) | ceases directly or indirectly to have the power (whether by way of ownership of shares, proxy, contract, agency or otherwise) to cast, or control the casting of, more than fifty one per cent (51%) of the maximum number of votes that might be cast at a general meeting of the Borrower or appoint or remove all, or a majority, of the directors or the other equivalent officers of the Borrower. |
7.3 | Voluntary cancellation |
7.4 | Voluntary prepayment |
7.5 | Right of replacement or repayment and cancellation in relation to a single Lender |
(i) | any sum payable to any Lender by the Borrower is required to be increased under Clause 12.1 (Payments free of Taxes); |
(ii) | any Lender claims indemnification from the Borrower under Clause 12.3 (Indemnification by the Borrower) or Clause 13.1 (Increased costs); or |
(iii) | interest on a Lender's participation in a Loan is being calculated in accordance with Clause 10.3 (Cost of funds), |
(i) | any of the circumstances set out in paragraph (a) above apply to a Lender; or |
(ii) | the Borrower becomes obliged to pay any amount in accordance with Clause 7.1 (Illegality) to any Lender, |
(i) | the Borrower shall have no right to replace the Agent or the Security Agent; |
(ii) | neither the Agent, the Security Agent nor any Lender shall have any obligation to find a replacement Lender; |
(iii) | in no event shall the Lender replaced under paragraph (d) above be required to pay or surrender any of the fees received by such Lender pursuant to the Finance Documents; and |
(iv) | the Lender shall only be obliged to transfer its rights and obligations pursuant to paragraph (d) above once it is satisfied that it has complied with all necessary "know your customer" or other similar checks under all applicable laws and regulations in relation to that transfer. |
7.6 | Right of cancellation in relation to a Defaulting Lender |
7.7 | Restrictions |
7.8 | Application of prepayments |
8. | INTEREST |
8.1 | Calculation of interest |
8.2 | Payment of interest |
8.3 | Default interest |
(i) | the first Interest Period for that overdue amount shall have a duration equal to the unexpired portion of the current Interest Period relating to that Loan; and |
(ii) | the rate of interest applying to the overdue amount during that first Interest Period shall be one per cent. per annum higher than the rate which would have applied if the overdue amount had not become due. |
8.4 | Notification of rates of interest |
8.5 | Margin adjustment |
8.5.1 | The Margin for each Loan in respect of any Interest Period shall be adjusted in order to correspond to the percentage per annum set out below in the applicable column for a Loan denominated in the Base Currency or in the Optional Currency opposite the range in which the Consolidated Total Net Leverage Ratio falls as from the first day of the Interest Period during which the Compliance Certificate has been received by the Agent (provided that the Compliance Certificate has been received at least five (5) Business Days prior to the expiry of the relevant Interest Period) or as from the first day of the next Interest Period if the Compliance Certificate has been received by the Agent less than five (5) Business Days prior to the expiry of the relevant Interest Period (and for the first time in respect of the first Interest Period for the first Utilisation, based on the unaudited consolidated financial statements of the Group as at 30 September 2017 or any more recent Accounts received by the Agent together with the Compliance Certificate). |
Consolidated Total Net Leverage Ratio | Loan drawn in the Base Currency (EUR) | Loan drawn in the Optional Currency (USD) |
Greater than or equal to 3.00:1 | 2.35% | 2.60% |
Less than 3.00:1 but greater than or equal to 2.50:1 | 2.15% | 2.40% |
Less than 2.50:1 but greater than or equal to 2:00:1 | 1.95% | 2.20% |
Less than 2.00:1 but greater than or equal to 1:50:1 | 1.75% | 2.0% |
Less than 1.50:1 | 1.45% | 1.70% |
8.5.2 | If the Compliance Certificate in relation to the consolidated annual unaudited financial statements (or, once the Borrower's financial statements are audited, consolidated annual audited financial statements) of the Borrower shows that the Margin should have been, but was not, increased, the Margin will be re-calculated retrospectively by reference to those consolidated annual unaudited (or consolidated annual audited) financial statements (as applicable) and appropriate adjustment payments will be required to be made (it being specified that such provision shall not apply to any Lender to the extent that it no longer holds a participation in the Facility both at the time to which the adjustment relates and at the date the adjustment is to be made). |
8.5.3 | If the consolidated annual unaudited financial statements (or, once the Borrower's financial statements are audited, consolidated annual audited financial statements) of the Borrower show that the Margin should have been, but was not decreased, the amounts payable by the Borrower at the end of the then current interest period shall be reduced so as to put the Lenders and the Borrower in the position they would have been in had the correct margin been applied (it being specified that such provision shall not apply to any Lender to the extent that it no longer holds a participation in the Facility at the date the adjustment is to be made). |
8.5.4 | No decrease in the Margin shall take effect if an Event of Default has occurred. If an Event of Default occurs and for so long as it is continuing, the Margin applicable to a Loan shall immediately be (if it is not already) the highest percentage per annum set out above for such a Loan, until the time when such Event of Default is waived or remedied. |
8.5.5 | For the purposes of this Clause 8.5, Margin adjustments shall not be limited to one step-down or step-up at a time. |
9. | INTEREST PERIODS |
9.1 | Selection of Interest Periods |
9.2 | Non-Business Days |
10. | CHANGES TO THE CALCULATION OF INTEREST |
10.1 | Unavailability of Screen Rate |
(i) | the currency of a Loan; or |
(ii) | the Interest Period of a Loan and it is not possible to calculate the Interpolated Screen Rate, |
(i) | the currency of that Loan; or |
(ii) | the Interest Period of that Loan and it is not possible to calculate the Interpolated Screen Rate, |
10.2 | Market disruption |
10.3 | Cost of funds |
(i) | the Margin; and |
(ii) | the rate notified to the Agent by that Lender as soon as practicable before the date on which interest is due to be paid in respect of that Interest Period, to be that which expresses as a percentage rate per annum the cost to the relevant Lender of funding its participation in that Loan from whatever source it may reasonably select. |
(i) | a Lender's Funding Rate is less than EURIBOR or, in relation to any Loan in dollars, LIBOR; or |
(ii) | a Lender does not supply a quotation by the time specified in paragraph (a)(ii) above, |
10.4 | Notification to Borrower |
10.5 | Break Costs |
11. | FEES |
11.1 | Non-utilisation fee |
11.2 | Upfront fee |
11.3 | Agency fee |
11.4 | Coordination fee |
12. | TAX GROSS UP AND INDEMNITIES |
12.1 | Payments Free of Taxes. |
12.2 | Payment of Other Taxes by the Borrower. |
12.3 | Indemnification by the Borrower. |
12.4 | Indemnification by the Lenders. |
12.5 | Evidence of Payments. |
12.6 | Status of Finance Parties. |
(a) | Any Finance Party that is entitled to an exemption from or reduction of withholding Tax with respect to payments made under any Finance Document shall deliver to the Borrower and the Agent, at the time or times reasonably requested by the Borrower or the Agent, such properly completed and executed documentation reasonably requested by the Borrower or the Agent as will permit such payments to be made without withholding or at a reduced rate of withholding. In addition, any Finance Party, if reasonably requested by the Borrower or the Agent, shall deliver such other documentation prescribed by applicable law or reasonably requested by the Borrower or the Agent as will enable the Borrower or the Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements. Notwithstanding anything to the contrary in the preceding two sentences, the completion, execution and submission of such documentation (other than such documentation set forth in 12.6(b)(i), (ii) and (iv) below) shall not be required if in the Finance Party's reasonable judgment such completion, execution or submission would subject such Finance Party to any material |
(i) | any Lender that is a U.S. Person shall deliver to the Borrower and the Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Agent), executed originals of IRS Form W-9 certifying that such Lender is exempt from U.S. federal backup withholding tax; |
(ii) | any Foreign Lender shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Agent), whichever of the following is applicable: |
(A) | in the case of a Foreign Lender claiming the benefits of an income tax treaty to which the United States is a party (x) with respect to payments of interest under any Finance Document, executed originals of IRS Form W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the "interest" article of such tax treaty and (y) with respect to any other applicable payments under any Finance Document, IRS Form W-8BEN-E establishing an exemption from, or reduction of, U.S. federal withholding Tax pursuant to the "business profits" or "other income" article of such tax treaty; |
(B) | executed originals of IRS Form W-8ECI; |
(C) | in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate in a form reasonably satisfactory to the Borrower and the Agent to the effect that such Foreign Lender is not a "bank" within the meaning of Section 881(c)(3)(A) of the Code, a "10 percent shareholder" of the Borrower within the meaning of Section 881(c)(3)(B) of the Code, or a "controlled foreign corporation" described in Section 881(c)(3)(C) of the Code (a "U.S. Tax Compliance Certificate") and (y) executed originals of IRS Form W-8BEN-E; or |
(D) | to the extent a Foreign Lender is not the beneficial owner, executed originals of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN-E, a U.S. Tax Compliance Certificate substantially in the form of Exhibit [J]-2 or Exhibit [J]-3, IRS Form W-9, and/or other certification documents from each beneficial owner, as applicable; provided that if the Foreign Lender is a partnership and one or more direct or indirect partners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a U.S. Tax Compliance Certificate in in a form reasonably satisfactory to the Borrower and the Agent on behalf of each such direct and indirect partner; |
(iii) | any Finance Party shall, to the extent it is legally entitled to do so, deliver to the Borrower and the Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Finance Party becomes a party to this Agreement (and from time to time thereafter upon the reasonable request of the Borrower or the Agent), executed originals of any other form prescribed by applicable law as a basis for claiming exemption from or a reduction in a |
(iv) | if a payment made to a Finance Party under any Finance Document would be subject to U.S. federal withholding Tax imposed by FATCA if such Lender were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Finance Party shall deliver to the Borrower and the Agent at the time or times prescribed by law and at such time or times reasonably requested by the Borrower or the Agent such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by the Borrower or the Agent as may be necessary for the Borrower and the Agent to comply with their obligations under FATCA and to determine that such Finance Party has complied with such Finance Party's obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (iv), "FATCA" shall include any amendments made to FATCA after the date of this Agreement. |
12.7 | Treatment of Certain Refunds. |
12.8 | Survival. |
13. | INCREASED COSTS |
13.1 | Increased costs |
(i) | the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation; |
(ii) | compliance with any law or regulation made after the date of this Agreement; or |
(iii) | the implementation or application of, or compliance with, Basel III or CRD IV or any law or regulation that implements or applies Basel III or CRD IV, |
(i) | "Increased Costs" means: |
(A) | a reduction in the rate of return from the Facility or on a Finance Party's (or its Affiliate's) overall capital; |
(B) | an additional or increased cost; or |
(C) | a reduction of any amount due and payable under any Finance Document, |
(ii) | "Basel III" means: |
(A) | the agreements on capital requirements, a leverage ratio and liquidity standards contained in "Basel III: A global regulatory framework for more resilient banks and banking systems", "Basel III: International framework for liquidity risk measurements, standards and monitoring" and "Guidance for national authorities operating the countercyclical capital buffer" published by the Basel Committee on Banking Supervision in December 2010, each as amended, supplemented or restated; and |
(B) | the rules for global systemically important banks contained in "Global systemically important banks: assessment methodology and the additional loss absorbency requirement - Rules text" published by the Basel Committee on Banking Supervision in November 2011 as amended, supplemented or restated; and |
(C) | any further guidance or standards published by the Basel Committee on Banking Supervision relating to "Basel III"; and |
(iii) | "CRD IV" means: |
(A) | Regulation (EU) No 575/2013 of the European Parliaments and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms; and |
(B) | Directive 2013/36/EU of the European Parliament and of the Council of 26 June 2013 on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms. |
13.2 | Increased cost claims |
13.3 | Exceptions |
(i) | (A) an Indemnified Tax, (B) a Tax described in clauses (b) through (d) of the definition of Excluded Taxes; and (C) Connection Income Taxes; or |
(ii) | attributable to the wilful breach by the relevant Finance Party or its Affiliates of any law or regulation. |
14. | OTHER INDEMNITIES |
14.1 | Currency indemnity |
(i) | making or filing a claim or proof against the Borrower; |
(ii) | obtaining or enforcing an order, judgment or award in relation to any litigation or arbitration proceedings, |
14.2 | Other indemnities |
14.3 | Indemnity to the Agent |
14.4 | Indemnity to the Security Agent |
(i) | any failure by the Borrower to comply with its obligations under Clause 16 (Costs and Expenses); |
(ii) | acting or relying on any notice, request or instruction which it reasonably believes to be genuine, correct and appropriately authorised; |
(iii) | the taking, holding, protection or enforcement of the Transaction Security; |
(iv) | the exercise of any of the rights, powers, discretions, authorities and remedies vested in the Security Agent by the Finance Documents or by law; |
(v) | any default by any Obligor in the performance of any of the obligations expressed to be assumed by it in the Finance Documents; or |
(vi) | acting as Security Agent under the Finance Documents or which otherwise relates to any of the Charged Property (otherwise in each case, than by reason of the Security Agent's gross negligence or wilful misconduct). |
15. | MITIGATION BY THE LENDERS |
15.1 | Mitigation |
15.2 | Limitation of liability |
16. | COSTS AND EXPENSES |
16.1 | Transaction expenses |
16.2 | Amendment costs |
16.3 | Enforcement costs |
17. | REPRESENTATIONS |
17.1 | Status |
17.2 | Power and authority |
17.3 | Validity and admissibility in evidence |
17.4 | Binding obligations |
17.5 | Ranking |
17.6 | Non-conflict with other obligations |
17.7 | No contravention |
17.8 | No breach of laws |
17.9 | No default |
17.10 | No misleading information |
17.11 | No proceedings |
17.12 | Environmental laws |
17.13 | Legal and beneficial ownership |
17.14 | Financial Statements |
(i) | the latest Annual Accounts fairly represent the consolidated financial position of the Group as at the date to which they were prepared and the results of the operations of the Group for the period to which they related and the state of the affairs of the Group at the end of that period and, in particular, disclose or reserve against all liabilities (actual or contingent) to the extent required by the Applicable Accounting Principles; and |
(ii) | the latest Half-Year Accounts show with reasonable accuracy the consolidated financial position of the Group as at the date to which they were prepared and the results of the operations of the Group for the period to which they related and, in particular, disclose or reserve against all liabilities (actual or contingent) to the extent required by the Applicable Accounting Principles. |
17.15 | Insolvency |
17.16 | No filing or stamp taxes |
17.17 | Group Structure Chart |
(i) | each member of the Group, including current name, its Original Jurisdiction (in the case of the Borrower), its jurisdiction of incorporation (in the case of any other member of the Group) and/or its jurisdiction of establishment, a list of shareholders and indicating whether a company is a Dormant Subsidiary or is not a company with limited liability; and |
(ii) | all minority interests in any member of the Group and any person in which any member of the Group holds shares in its issued share capital or equivalent ownership interest of such person. |
17.18 | Anti-corruption laws |
17.19 | Sanctions |
(a) | is a Sanctioned Person; |
(b) | is a person who is otherwise the target of Sanctions such that the entry into, or performance, of this Agreement or any other Finance Document would be prohibited for a Lender or would cause such Lender to breach applicable law; |
(c) | is owned or controlled by (including, without limitation, by virtue of such person being a director or owning voting shares or interests), or acts, directly or indirectly, for or on |
(d) | engage or have engaged in any dealings or transactions with, involving or for the benefit of a Sanctioned Person, or involving any Sanctioned Country, in each case in violation of Sanctions; |
(e) | is subject to any action, proceeding or litigation with regard to any actual violation of Sanctions; |
(f) | engage in any activity that could trigger a designation under existing Sanctions; or |
(g) | is located, organized or resident in a Sanctioned Country. |
17.20 | Anti-money laundering |
(a) | None of the Borrower, any other member of the Group or any of their respective directors or officers, or, to the best knowledge of the Borrower, any Affiliate or any agent or employee of it, has engaged in any activity or conduct which would violate any applicable anti-money laundering laws, rules or regulations in any applicable jurisdiction and each member of the Group has instituted and maintained policies and procedures designated to prevent violation of such laws, rules or regulations. |
(b) | None of the Borrower, any other member of the Group or any of their respective directors or officers, has been subject to any action, proceeding, litigation, claim or, to the best knowledge of the Borrower, any Affiliate or employee of it, investigation with regard to any actual or alleged violation of any applicable anti-money laundering or terrorist financing laws, rules or regulations in any applicable jurisdiction. |
17.21 | ERISA and Multiemployer Plans |
17.22 | Investment Companies |
17.23 | Federal Regulations |
17.24 | Repetition |
18. | INFORMATION UNDERTAKINGS |
18.1 | Financial statements |
(i) | as soon as the same become available, but in any event within one hundred and twenty (120) days after the end of each Financial Year: |
(A) | the unaudited consolidated financial statements of the Group for that Financial Year; |
(B) | the audited consolidated financial statements of UGI France for that Financial Year; and |
(C) | the unaudited unconsolidated financial statements of the Borrower for that Financial Year; |
(ii) | as soon as the same become available, but in any event within ninety (90) days after the end of each Accounting Half-Year: |
(A) | the unaudited consolidated financial statements of the Group for that Accounting Half-Year; and |
(B) | the unaudited consolidated financial statements of UGI France for that Accounting Half-Year; |
(i) | as soon as the same become available, but in any event within one hundred and twenty (120) days after the end of each Financial Year: |
(A) | the audited consolidated financial statements of the Group for that Financial Year; |
(B) | the audited unconsolidated financial statements of the Borrower for that Financial Year; and |
(C) | the audited consolidated financial statements of UGI France for that Financial Year; |
(ii) | as soon as the same become available, but in any event within ninety (90) days after the end of each Accounting Half-Year, for each Accounting Half-Year, the unaudited consolidated financial statements of the Group for that Accounting Half-Year; and |
(iii) | as soon as the same become available, but in any event no later than 30 June 2018: |
(A) | the audited consolidated financial statements of the Group for the Financial Year ending 30 September 2017; |
(B) | the audited unconsolidated financial statements of the Borrower for the Financial Year ending 30 September 2017; and |
(C) | the audited consolidated financial statements of UGI France for the Financial Year ending 30 September 2017. |
18.2 | Compliance Certificate |
(a) | The Borrower shall supply to the Agent, with each set of financial statements delivered pursuant to paragraph (a)(i)(A), (a)(i)(B), (a)(ii)(A), (b)(i)(A), (b)(i)(c) and (b)(ii) of Clause 18.1 (Financial statements) a Compliance Certificate setting out (in reasonable detail) computations as to compliance with Clause 19 (Financial covenant) as at the date as at which those financial statements were drawn up. |
(b) | Each Compliance Certificate shall be signed by an Authorised Representative and, in the case of the audited consolidated financial statements, shall be reported on by the Borrower's auditors in the form agreed by the Borrower and all the Lenders before the date of this Agreement. |
18.3 | Requirements as to financial statements |
(a) | Each set of financial statements delivered by the Borrower pursuant to Clause 18.1 (Financial statements) shall be certified by a Chief Financial Officer or a treasurer of the relevant company as fairly presenting its financial condition as at the date as at which those financial statements were drawn up. |
(b) | The Borrower shall procure that each set of financial statements delivered pursuant to Clause 18.1 (Financial statements) is prepared using the "Applicable Accounting Principles" which means: |
(i) | in relation to any audited or unaudited consolidated financial statements of the Group and any audited or unaudited consolidated financial statements of UGI France, GAAP; and |
(ii) | in relation to any other member of the Group, generally accepted accounting principles, standards, and practices in its jurisdiction of incorporation. |
18.4 | Information: miscellaneous |
18.5 | US Patriot Act notification |
18.6 | Notification of default |
18.7 | Use of websites |
(i) | the Agent expressly agrees (after consultation with each of the Lenders) that it will accept communication of the information by this method; |
(ii) | both the Borrower and the Agent are aware of the address of and any relevant password specifications for the Designated Website; and |
(iii) | the information is in a format previously agreed between the Borrower and the Agent. |
(i) | the Designated Website cannot be accessed due to technical failure; |
(ii) | the password specifications for the Designated Website change; |
(iii) | any new information which is required to be provided under this Agreement is posted onto the Designated Website; |
(iv) | any existing information which has been provided under this Agreement and posted onto the Designated Website is amended; or |
(v) | the Borrower becomes aware that the Designated Website or any information posted onto the Designated Website is or has been infected by any electronic virus or similar software. |
18.8 | "Know your customer" checks |
(i) | the introduction of or any change in (or in the interpretation, administration or application of) any law or regulation made after the date of this Agreement; |
(ii) | any change in the status of an Obligor (or of a Holding Company of an Obligor) after the date of this Agreement; or |
(iii) | a proposed assignment or transfer by a Lender of any of its rights and obligations under this Agreement to a party that is not a Lender prior to such assignment or transfer, |
19. | FINANCIAL COVENANT |
19.1 | Financial condition |
19.2 | Financial testing |
19.3 | Equity Cure |
(i) | the requirement of the financial covenant contained in Clause 19.1 (Financial condition) is not met in respect of a Testing Period (the "Applicable Period"); and |
(ii) | cash proceeds (the "Equity Cure Amount") are received by the Borrower pursuant to any New Shareholder Injections after the end of the applicable Testing Period but prior to the end of a period of fifteen (15) Business Days following the date on which the Compliance Certificate for the applicable Testing Period is required to be delivered in accordance with Clause 18.2 (Compliance Certificate), |
(iii) | the Borrower may elect to remedy the failure to comply with the requirements of the financial covenant contained in Clause 19.1 (Financial condition) by reducing the Consolidated Total Net Indebtedness for that Testing Period as if a prepayment and cancellation of the Indebtedness of the Group had been made on the last day of the applicable Testing Period in the amount of the Equity Cure Amount. |
(i) | more than two (2) times over the life of the Facility; and |
(ii) | in connection with two (2) consecutive Testing Periods. |
20. | GENERAL UNDERTAKINGS |
20.1 | Authorisations |
20.2 | Compliance with laws |
20.3 | Publication of financial statements |
20.4 | Negative pledge |
(i) | the Borrower shall not create or permit to subsist any Security over any share in UGI Europe; and |
(ii) | the Borrower shall procure that the Dutch Security Grantor will not create or permit to subsist any Security over any share in UGI France which is not the subject of the Security granted pursuant to the French Pledge. |
(i) | sell, transfer or otherwise dispose of any of its assets on terms whereby they are or may be leased to or re-acquired by an Obligor or any other member of the Group; |
(ii) | sell, transfer or otherwise dispose of any of its receivables on recourse terms; |
(iii) | enter into any arrangement under which money or the benefit of a bank or other account may be applied, set-off or made subject to a combination of accounts; or |
(iv) | enter into any other preferential arrangement having a similar effect, |
(i) | the Transaction Security; |
(ii) | any Security or Quasi-Security listed in Schedule 6 (Existing Security) except to the extent the principal amount secured by that Security or Quasi-Security exceeds the amount stated in that Schedule; |
(iii) | any netting or set-off arrangement entered into by any member of the Group in the ordinary course of its banking arrangements for the purpose of netting debit and credit balances; |
(iv) | any payment or close out netting or set-off arrangement pursuant to any hedging transaction entered into by a member of the Group for the purpose of: |
(A) | hedging any risk to which any member of the Group is exposed in its ordinary course of trading; or |
(B) | its interest rate or currency management operations which are carried out in the ordinary course of business and for non-speculative purposes only, |
(i) | any lien arising by operation of law and in the ordinary course of trading; |
(ii) | any Security or Quasi-Security over or affecting any asset acquired by a member of the Group after the date of this Agreement if: |
(A) | the Security or Quasi-Security was not created in contemplation of the acquisition of that asset by a member of the Group; |
(B) | the principal amount secured has not been increased in contemplation of or since the acquisition of that asset by a member of the Group; and |
(C) | the Security or Quasi-Security is removed or discharged within six (6) months of the date of acquisition of such asset; |
(iii) | any Security or Quasi-Security over or affecting any asset of any company which becomes a member of the Group after the date of this Agreement, where the Security or Quasi-Security is created prior to the date on which that company becomes a member of the Group, if: |
(A) | the Security or Quasi-Security was not created in contemplation of the acquisition of that company; |
(B) | the principal amount secured has not increased in contemplation of or since the acquisition of that company; and |
(C) | the Security or Quasi-Security is removed or discharged within six (6) months of that company becoming a member of the Group; |
(iv) | any Security or Quasi-Security entered into pursuant to any Finance Document; |
(v) | any Security or Quasi-Security arising under any retention of title, hire purchase or conditional sale arrangement or arrangements having similar effect in respect of goods supplied to a member of the Group in the ordinary course of trading and on the supplier's standard or usual terms and not arising as a result of any default or omission by any member of the Group; or |
(vi) | any Security or Quasi-Security not otherwise permitted pursuant to any of the above paragraphs securing indebtedness the outstanding principal amount of which (when aggregated with the outstanding principal amount of any other indebtedness which has the benefit of Security or Quasi-Security given by any member of the Group other than permitted under the paragraphs above) does not exceed fifteen percent (15%) of the Total Assets at any time. |
20.5 | Disposals |
(i) | made in the ordinary course of trading of the disposing entity; |
(ii) | of assets in exchange for other assets comparable or superior as to type, value and quality (other than an exchange of a non-cash asset for cash); or |
(iii) | which is a Permitted Disposal. |
20.6 | Indebtedness - Intermediary Holding Companies |
20.7 | Merger |
(i) | any sale, lease, transfer or other disposal permitted pursuant to Clause 20.5 (Disposals); or |
(ii) | any Permitted Merger. |
20.8 | Loans or credit |
20.9 | Acquisitions |
20.10 | Dividend and interest payment under the Subordinated Loan |
20.11 | Insurance |
20.12 | Change of business |
20.13 | Pari passu ranking |
20.14 | Taxes |
20.15 | Intellectual Property |
20.16 | Environmental compliance |
20.17 | Environmental Claims |
20.18 | Ownership |
20.19 | Sanctions |
20.20 | Anti-corruption laws and anti-money laundering |
(i) | conduct its businesses in compliance with applicable Anti-Corruption Rules and anti-money laundering laws or regulations; |
(ii) | take at any time all the measures imposed by the Anti-Corruption Rules applicable to it; |
(iii) | maintain policies and procedures designed to promote and achieve compliance with such laws or regulations; and |
(iv) | not, directly or indirectly, use the proceeds of the Facility for any payments to any governmental official or employee, political party, official of a political party, candidate for political office, or anyone else acting in an official capacity, in order to obtain, retain or direct business or obtain any improper advantage, in each case in violation of Anti-Corruption Rules. |
20.21 | DCM Transactions |
21. | EVENTS OF DEFAULT |
21.1 | Non-payment |
(i) | administrative or technical error; or |
(ii) | a Disruption Event; and |
21.2 | Financial covenant |
21.3 | Other obligations |
21.4 | Misrepresentation |
21.5 | Cross default |
21.6 | Insolvency |
(i) | is unable or admits inability to pay its debts as they fall due; |
(ii) | is deemed to be unable to pay its debts as they fall due; |
(iii) | suspends or threatens to suspend payment of its debts generally; or |
(iv) | by reason of actual or anticipated financial difficulties, commences negotiations with one or more of its creditors (excluding any Finance Party in its capacity as such) with a view to rescheduling any of its indebtedness. |
21.7 | Insolvency proceedings |
21.8 | Creditors' process |
21.9 | Unlawfulness |
21.10 | Repudiation |
21.11 | Invalidity |
21.12 | Auditors' qualification |
21.13 | No judgment |
21.14 | Material adverse change |
21.15 | ERISA |
21.16 | Acceleration |
22. | CHANGES TO THE LENDERS |
22.1 | Assignments and transfers by the Lenders |
22.2 | Borrower consent |
(i) | to another Lender or an Affiliate of any Lender; or |
(ii) | made at a time when an Event of Default is continuing. |
22.3 | Other conditions of assignment or transfer |
(i) | receipt by the Agent (whether in the Assignment Agreement or otherwise) of written confirmation from the New Lender (in form and substance satisfactory to the Agent) that the New Lender will assume the same obligations to the other Finance Parties as it would have been under if it had been an Original Lender; and |
(ii) | performance by the Agent of all necessary "know your customer" or other similar checks under all applicable laws and regulations in relation to such assignment to a New Lender, the completion of which the Agent shall promptly notify to the Existing Lender and the New Lender. |
(i) | a Lender changes its Facility Office; and |
(ii) | as a result of circumstances existing at the date the change occurs, an Obligor would be obliged to make a payment to the Lender acting through its new Facility Office under Clause 12 (Tax gross-up and indemnities) or Clause 13 (Increased Costs), |
22.4 | Assignment or transfer fee |
22.5 | Limitation of responsibility of Existing Lenders |
(i) | the legality, validity, effectiveness, adequacy or enforceability of the Finance Documents or any other documents; |
(ii) | the financial condition of any Obligor; |
(iii) | the performance and observance by any Obligor of its obligations under the Finance Documents or any other documents; or |
(iv) | the accuracy of any statements (whether written or oral) made in or in connection with any Finance Document or any other document, |
(i) | has made (and shall continue to make) its own independent investigation and assessment of the financial condition and affairs of each Obligor and its related entities in connection with its participation in this Agreement and has not relied exclusively on any information provided to it by the Existing Lender in connection with any Finance Document; and |
(ii) | will continue to make its own independent appraisal of the creditworthiness of each Obligor and its related entities whilst any amount is or may be outstanding under the Finance Documents or any Commitment is in force. |
(i) | accept a re-transfer or re-assignment from a New Lender of any of the rights and obligations assigned or transferred under this Clause 22; or |
(ii) | support any losses directly or indirectly incurred by the New Lender by reason of the non-performance by any Obligor of its obligations under the Finance Documents or otherwise. |
22.6 | Procedure for transfer |
(i) | to the extent that in the Transfer Certificate the Existing Lender seeks to transfer by novation its rights and obligations under the Finance Documents each of the Obligors and the Existing Lender shall be released from further obligations towards one another under the Finance Documents and their respective rights against one another under the Finance Documents shall be cancelled (being the "Discharged Rights and Obligations"); |
(ii) | each of the Obligors and the New Lender shall assume obligations towards one another and/or acquire rights against one another which differ from the Discharged Rights and Obligations only insofar as that Obligor and the New Lender have assumed and/or acquired the same in place of that Obligor and the Existing Lender; |
(iii) | the Agent, the Security Agent, the Mandated Lead Arrangers, the New Lender and other Lenders shall acquire the same rights and assume the same obligations between themselves as they would have acquired and assumed had the New Lender been an Original Lender with the rights and/or obligations acquired or assumed by it as a result of the transfer and to that extent the Agent, the Security Agent, the Mandated Lead Arrangers and the Existing Lender shall each be released from further obligations to each other under the Finance Documents; and |
(iv) | the New Lender shall become a Party as a "Lender". |
22.7 | Procedure for assignment |
(i) | the Existing Lender will assign absolutely to the New Lender the rights under the Finance Documents expressed to be the subject of the assignment in the Assignment Agreement; |
(ii) | the Existing Lender will be released by each Obligor and the other Finance Parties from the obligations owed by it (the "Relevant Obligations") and expressed to be the subject of the release in the Assignment Agreement; and |
(iii) | the New Lender shall become a Party as a "Lender" and will be bound by obligations equivalent to the Relevant Obligations. |
22.8 | Copy of Transfer Certificate, Assignment Agreement or Increase Confirmation to Borrower |
22.9 | Security over Lenders' rights |
(i) | release a Lender from any of its obligations under the Finance Documents or substitute the beneficiary of the relevant charge, assignment or Security for the Lender as a party to any of the Finance Documents; or |
(ii) | require any payments to be made by the Borrower other than or in excess of, or grant to any person any more extensive rights than, those required to be made or granted to the relevant Lender under the Finance Documents. |
22.10 | Pro rata interest settlement |
(i) | any interest or fees in respect of the relevant participation which are expressed to accrue by reference to the lapse of time shall continue to accrue in favour of the Existing Lender up to but excluding the Transfer Date ("Accrued Amounts") and shall become due and payable to the Existing Lender (without further interest accruing on them) on the last day of the current Interest Period (or, if the Interest Period is longer than six Months, on the next of the dates which falls at six Monthly intervals after the first day of that Interest Period); and |
(ii) | the rights assigned or transferred by the Existing Lender will not include the right to the Accrued Amounts, so that, for the avoidance of doubt: |
22.11 | Register |
23. | CHANGES TO THE BORROWER |
23.1 | Assignments and transfer by the Borrower |
24. | ROLE OF THE AGENT, THE SECURITY AGENT AND THE MANDATED LEAD ARRANGERS |
24.1 | Appointment of the Agent |
(i) | to execute such of the Finance Documents which are expressed to be executed by the Agent and the Security Agent on behalf of the Lenders; and |
(ii) | to perform the duties, obligations and responsibilities and to exercise the rights, powers, authorities and discretions specifically given to the Agent and the Security Agent under or in connection with the Finance Documents together with any other incidental rights, powers, authorities and discretions. |
24.2 | Instructions |
(i) | unless a contrary indication appears in a Finance Document, exercise or refrain from exercising any right, power, authority or discretion vested in it as Agent in accordance with any instructions given to it by: |
(A) | all Lenders if the relevant Finance Document stipulates the matter is an all Lender decision; and |
(B) | in all other cases, the Majority Lenders; and |
(ii) | not be liable for any act (or omission) if it acts (or refrains from acting) in accordance with paragraph (i) above. |
24.3 | Duties of the Agent |
24.4 | Role of the Mandated Lead Arrangers |
24.5 | No fiduciary duties |
24.6 | Business with the Group |
24.7 | Rights and discretions |
(i) | rely on any representation, communication, notice or document believed by it to be genuine, correct and appropriately authorised; |
(ii) | assume that: |
(A) | any instructions received by it from the Majority Lenders, any Lenders or any group of Lenders are duly given in accordance with the terms of the Finance Documents; and |
(B) | unless it has received notice of revocation, that those instructions have not been revoked; and |
(iii) | rely on a certificate from any person: |
(A) | as to any matter of fact or circumstance which might reasonably be expected to be within the knowledge of that person; or |
(B) | to the effect that such person approves of any particular dealing, transaction, step, action or thing, |
(i) | no Default has occurred (unless it has actual knowledge of a Default arising under Clause 21.1 (Non-payment)); |
(ii) | any right, power, authority or discretion vested in any Party or any group of Lenders has not been exercised; and |
(iii) | any notice or request made by the Borrower (other than a Utilisation Request) is made on behalf of and with the consent and knowledge of all the Obligors. |
24.8 | Responsibility for documentation |
24.9 | No duty to monitor |
24.10 | Exclusion of liability |
(i) | any damages, costs or losses to any person, any diminution in value, or any liability whatsoever arising as a result of taking or not taking any action under or in connection with any Finance Document, unless directly caused by its gross negligence or wilful misconduct; |
(ii) | exercising, or not exercising, any right, power, authority or discretion given to it by, or in connection with, any Finance Document or any other agreement, arrangement or document entered into, made or executed in anticipation of, under |
(iii) | without prejudice to the generality of paragraphs (i) and (ii) above, any damages, costs or losses to any person, any diminution in value or any liability whatsoever (including, without limitation, for negligence or any other category of liability whatsoever but not including any claim based on the fraud of the Agent) arising as a result of: |
(i) | any "know your customer" or other checks in relation to any person; or |
(ii) | any check on the extent to which any transaction contemplated by this Agreement might be unlawful for any Lender or for any Affiliate of any Lender, |
24.11 | Lenders' indemnity to the Agent |
24.12 | Resignation of the Agent |
(i) | the Agent fails to respond to a request under Clause 12.6(b)(iv) and the Borrower or a Lender reasonably believes that the Agent will not be (or will have ceased to be) a FATCA Exempt Party on or after that FATCA Application Date; |
(ii) | the information supplied by the Agent pursuant to Clause 12.6(b)(iv) indicates that the Agent will not be (or will have ceased to be) a FATCA Exempt Party on or after that FATCA Application Date; or |
(iii) | the Agent notifies the Borrower and the Lenders that the Agent will not be (or will have ceased to be) a FATCA Exempt Party on or after that FATCA Application Date; |
24.13 | Confidentiality |
24.14 | Relationship with the Lenders |
(i) | entitled to or liable for any payment due under any Finance Document on that day; and |
(ii) | entitled to receive and act upon any notice, request, document or communication or make any decision or determination under any Finance Document made or delivered on that day, |
24.15 | Credit appraisal by the Lenders |
24.16 | Deduction from amounts payable by the Agent |
24.17 | Role of the Security Agent |
25. | CONDUCT OF BUSINESS BY THE FINANCE PARTIES |
26. | SHARING AMONG THE FINANCE PARTIES |
26.1 | Payments to Finance Parties |
26.2 | Redistribution of payments |
26.3 | Recovering Finance Party's rights |
26.4 | Reversal of redistribution |
26.5 | Exceptions |
(i) | it notified that other Finance Party of the legal or arbitration proceedings; and |
(ii) | that other Finance Party had an opportunity to participate in those legal or arbitration proceedings but did not do so as soon as reasonably practicable having received notice and did not take separate legal or arbitration proceedings. |
27. | PAYMENT MECHANICS |
27.1 | Payments to the Agent |
27.2 | Distributions by the Agent |
27.3 | Distributions to an Obligor |
27.4 | Clawback and pre-funding |
(i) | the Borrower to whom that sum was made available shall on demand refund it to the Agent; and |
(ii) | the Lender by whom those funds should have been made available or, if that Lender fails to do so, the Borrower to whom that sum was made available, shall on demand pay to the Agent the amount (as certified by the Agent) which will indemnify the Agent against any funding cost incurred by it as a result of paying out that sum before receiving those funds from that Lender. |
27.5 | Partial payments |
(i) | first, in or towards payment pro rata of any unpaid amount owing to the Agent and the Security Agent under the Finance Documents; |
(ii) | secondly, in or towards payment pro rata of any accrued interest, fee or commission due but unpaid under this Agreement; |
(iii) | thirdly, in or towards payment pro rata of any principal due but unpaid under this Agreement; and |
(iv) | fourthly, in or towards payment pro rata of any other sum due but unpaid under the Finance Documents. |
27.6 | No set-off by the Borrower |
27.7 | Business Days |
27.8 | Currency of account |
27.9 | Change of currency |
(i) | any reference in the Finance Documents to, and any obligations arising under the Finance Documents in, the currency of that country shall be translated into, or paid in, the currency or currency unit of that country designated by the Agent (after consultation with the Borrower); and |
(ii) | any translation from one currency or currency unit to another shall be at the official rate of exchange recognised by the central bank for the conversion of that currency or currency unit into the other, rounded up or down by the Agent (acting reasonably). |
27.10 | Disruption to payment systems etc. |
28. | SET-OFF |
29. | NOTICES |
29.1 | Communications in writing |
29.2 | Addresses |
29.3 | Delivery |
29.4 | Notification of address and email address |
29.5 | Electronic communication |
(i) | notify each other in writing of their electronic mail address and/or any other information required to enable the transmission of information by that means; and |
(ii) | notify each other of any change to their address or any other such information supplied by them by not less than five (5) Business Days' notice. |
29.6 | English language |
(i) | in English; or |
(ii) | if not in English, and if so required by the Agent, accompanied by a certified English translation and, in this case, the English translation will prevail unless the document is a constitutional, statutory or other official document. |
30. | CALCULATIONS AND CERTIFICATES |
30.1 | Accounts |
30.2 | Certificates and Determinations |
30.3 | Day count convention |
31. | PARTIAL INVALIDITY |
32. | REMEDIES AND WAIVERS |
33. | AMENDMENTS AND WAIVERS |
33.1 | Required consents |
33.2 | All Lender matters |
33.3 | Other exceptions |
33.4 | Replacement of Screen Rate |
(i) | its Commitment shall not be included for the purpose of calculating the Total Commitments when ascertaining whether any relevant percentage of Total Commitments has been obtained to approve that request; and |
(ii) | its status as a Lender shall be disregarded for the purpose of ascertaining whether the agreement of any specified group of Lenders has been obtained to approve that request. |
34. | CONFIDENTIAL INFORMATION |
34.1 | Confidentiality |
34.2 | Disclosure of Confidential Information |
(a) | to any of its Affiliates and Related Funds and any of its or their officers, directors, employees, professional advisers, auditors, partners and Representatives, or to any other such third party (provided, that in the case of a third party, such third party must deliver a Confidentiality Undertaking to the Borrower) relating to the Borrower and its obligations such Confidential Information as that Finance Party shall consider appropriate if any person to whom the Confidential Information is to be given pursuant to this paragraph (a) is informed in writing of its confidential nature and that some or all of such Confidential Information may be price-sensitive information except that there shall be no such requirement to so inform if the recipient is subject to professional obligations to maintain the confidentiality of the information or is otherwise bound by requirements of confidentiality in relation to the Confidential Information; |
(i) | to (or through) whom it assigns or transfers (or may potentially assign or transfer) all or any of its rights and/or obligations under one or more Finance Documents, to any direct, indirect, actual or prospective counterparty to any swap, derivative or securitization transaction related to the obligations under this Agreement or which succeeds (or which may potentially succeed) it as Agent or Security Agent and, in each case, to any of that person's Affiliates, Related Funds, Representatives and professional advisers; |
(ii) | with (or through) whom it enters into (or may potentially enter into), whether directly or indirectly, any sub-participation in relation to, or any other transaction under which payments are to be made or may be made by reference to, one or more Finance Documents and/or one or more Obligors and to any of that person's Affiliates, Related Funds, Representatives and professional advisers; |
(iii) | appointed by any Finance Party or by a person to whom paragraph (b)(i) or (ii) above applies to receive communications, notices, information or documents delivered pursuant to the Finance Documents on its behalf (including, without limitation, any person appointed under paragraph (c) of Clause 24.14 (Relationship with the Lenders)); |
(iv) | who invests in or otherwise finances (or may potentially invest in or otherwise finance), directly or indirectly, any transaction referred to in paragraph (b)(i) or (b)(ii) above; |
(v) | to whom information is required or requested to be disclosed by any court of competent jurisdiction or any governmental, banking, taxation or other regulatory authority or similar body, the rules of any relevant stock exchange or pursuant to any applicable law or regulation; |
(vi) | to whom information is required to be disclosed in connection with, and for the purposes of, any litigation, arbitration, administrative or other investigations, proceedings or disputes; |
(vii) | to whom or for whose benefit that Finance Party charges, assigns or otherwise creates Security (or may do so) pursuant to Clause 22.9 (Security over Lenders' rights); |
(viii) | who is a Party; or |
(ix) | with the consent of the Borrower; |
34.3 | Disclosure to numbering service providers |
(i) | names of Obligors; |
(ii) | country of domicile of Obligors; |
(iii) | place of incorporation of Obligors; |
(iv) | date of this Agreement; |
(v) | Clause 37 (Governing law); |
(vi) | the names of the Agent, the Security Agent and the Mandated Lead Arrangers; |
(vii) | date of each amendment and restatement of this Agreement; |
(viii) | amounts of, and names of, the Facility (and any tranches); |
(ix) | amount of Total Commitments; |
(x) | currencies of the Facility; |
(xi) | type of Facility; |
(xii) | ranking of Facility; |
(xiii) | Termination Date for Facility; |
(xiv) | changes to any of the information previously supplied pursuant to paragraphs (i) to (xiii) above; and |
(xv) | such other information agreed between such Finance Party and the Borrower, |
34.4 | Entire agreement |
34.5 | Inside information |
34.6 | Notification of disclosure |
34.7 | Continuing obligations |
35. | CONFIDENTIALITY OF FUNDING RATES |
35.1 | Confidentiality and disclosure |
(i) | any Funding Rate to the Borrower pursuant to Clause 8.4 (Notification of rates of interest); and |
(ii) | any Funding Rate to any person appointed by it to provide administration services in respect of one or more of the Finance Documents to the extent necessary to enable such service provider to provide those services if the service provider to whom that information is to be given has entered into a confidentiality agreement substantially in the form of the LMA Master Confidentiality Undertaking for Use With Administration/Settlement Service Providers or such other form of confidentiality undertaking agreed between the Agent and the relevant Lender. |
(i) | any of its Affiliates and any of its or their officers, directors, employees, professional advisers, auditors, partners and Representatives if any person to whom that Funding Rate is to be given pursuant to this paragraph (i) is informed in writing of its confidential nature and that it may be price-sensitive information except that there shall be no such requirement to so inform if the recipient is subject to professional obligations to maintain the confidentiality of that Funding Rate or is otherwise bound by requirements of confidentiality in relation to it; |
(ii) | any person to whom information is required or requested to be disclosed by any court of competent jurisdiction or any governmental, banking, taxation or other regulatory authority or similar body, the rules of any relevant stock exchange or pursuant to any applicable law or regulation if the person to whom that Funding Rate is to be given is informed in writing of its confidential nature and that it may be price-sensitive information except that there shall be no requirement to so inform if, in the opinion of the Agent or the Borrower, as the case may be, it is not practicable to do so in the circumstances; |
(iii) | any person to whom information is required to be disclosed in connection with, and for the purposes of, any litigation, arbitration, administrative or other investigations, proceedings or disputes if the person to whom that Funding Rate is to be given is informed in writing of its confidential nature and that it may be price-sensitive information except that there shall be no requirement to so inform if, in the opinion of the Agent or the Borrower, as the case may be, it is not practicable to do so in the circumstances; and |
(iv) | any person with the consent of the relevant Lender. |
35.2 | Related obligations |
(i) | of the circumstances of any disclosure made pursuant to paragraph (c)(ii) of Clause 35.1 (Confidentiality and disclosure) except where such disclosure is made to any of the persons referred to in that paragraph during the ordinary course of its supervisory or regulatory function; and |
(ii) | upon becoming aware that any information has been disclosed in breach of this Clause 35. |
35.3 | No Event of Default |
36. | COUNTERPARTS |
37. | GOVERNING LAW |
38. | ENFORCEMENT |
38.1 | Jurisdiction |
38.2 | Service of process |
Name of Original Lender | Commitment (€) |
NATIXIS | 50,000,000 |
BNP PARIBAS | 50,000,000 |
CREDIT AGRICOLE CORPORATE AND INVESTMENT BANK | 50,000,000 |
HSBC FRANCE | 50,000,000 |
ING BANK N.V., FRENCH BRANCH | 50,000,000 |
MEDIOBANCA INTERNATIONAL (LUXEMBOURG) S.A. | 50,000,000 |
Total | €300,000,000 |
1. | Obligors |
(a) | A certified copy of the constitutional documents for the Borrower, including: |
(i) | an original or a certified copy of their constitutional documents and other by-laws; |
(ii) | their certificate of incorporation; |
(iii) | a certificate of good standing for the Borrower; |
(iv) | applicable uniform commercial code ("UCC") searches for the Borrower; |
(v) | bankruptcy searches for the Borrower. |
(b) | In respect of the Borrower: |
(i) | a certified copy of a resolution of its board of supervisory directors (if any) approving the execution of, and the terms of, and the transactions contemplated by, the Finance Documents to which it is a party; |
(ii) | authorising a specified person or persons to execute the Finance Documents to which it is a party;] |
(c) | In respect of the Borrower, a secretary certificate signed by the company secretary or assistant secretary: |
(i) | certifying that each copy document relating to it specified in this Part 1 of Schedule 2 is correct, complete and in full force and effect and has not been amended or superseded as at the Signing Date; |
(ii) | including a specimen signature of each person authorised to sign the Finance Documents and each Utilisation Request and any other related documents and evidence of such authorisation; |
(d) | In respect of the Borrower, a certificate signed by the Authorised Representative certifying that: |
(i) | utilisation by the Borrower of the Total Commitments in full would not breach any limit binding on it; |
(ii) | there is no Default at Signing Date; and |
(iii) | the Consolidated Total Net Leverage Ratio pro forma for the acquisitions of UGI Italia S.r.l. and DVEP Investeringen B.V. (the "Recent Acquisitions") as at the Signing Date is less than or equal to 3.5x. |
(e) | A certified copy of the constitutional documents for the Dutch Security Grantor including: |
(i) | an up-to-date extract from the Dutch trade register (handelsregister) relating to it dated no earlier than five (5) Business Days prior to the date of this Agreement; |
(ii) | Deed of incorporation (Akte van oprichting); |
(iii) | Articles of association (statuten). |
(f) | In respect of the Dutch Security Grantor: |
(i) | a copy of a resolution of its board of supervisory directors approving the execution of, and the terms of, and the transactions contemplated by, the French Pledge; |
(ii) | authorising a specified person or persons to execute the French Pledge; |
(g) | In respect of the Dutch Security Grantor, a certificate signed by a director or officer who is authorised to represent the Dutch Security Grantor certifying that each copy document relating to it specified in this Part 1 of Schedule 2 is correct, complete and in full force and effect and has not been amended or superseded as at the Signing Date; |
(h) | A certified copy of the constitutional documents for UGI France including: |
(i) | an up-to-date extract from the French trade register relating to it dated no earlier than fifteen (15) Business Days prior to the date of this Agreement; and |
(ii) | Articles of association. |
2. | Finance Documents |
(a) | this Agreement; and |
(b) | any Fee Letter to be executed at the Signing Date. |
3. | Security Document |
(a) | At least two originals of the French Pledge. |
(b) | A copy of all notices required to be sent under the French Pledge executed by the Dutch Grantor and, where customary in the Relevant Jurisdiction, duly acknowledged by the addressee. |
(c) | All share certificates, transfers and stock transfer forms or equivalent duly executed by the Dutch Grantor in blank in relation to the assets subject to or expressed to be subject to the Security and other documents of title to be provided under the French Pledge. |
4. | Legal opinions |
(a) | An opinion from Gide Loyrette Nouel LLP, legal advisers to the Agent as to English law substantially in the form distributed to the Original Lenders prior to signing of this Agreement. |
(b) | An opinion from Loyens & Loeff N.V., legal advisers to the Obligors as to Dutch law substantially in the form distributed to the Original Lenders prior to signing of this Agreement. |
(c) | An opinion from Gide Loyrette Nouel AARPI, legal advisers to the Agent as to French law substantially in the form distributed to the Original Lenders prior to signing of this Agreement. |
(d) | An opinion from Morgan, Lewis & Bockius LLP, legal advisers to the Obligors as to US law substantially in the form distributed to the Original Lenders prior to signing of this Agreement. |
5. | Other documents and evidence |
(a) | Delivery of satisfactory "Know your customers" checks documents as may be required by the Original Lenders in accordance with their business requirements. |
(b) | Delivery of the business plan and the projections of the Group for the period 2017 to 2020 pro forma for the Recent Acquisitions as defined under (i) below. |
(c) | Evidence that, upon the Signing Date, all documented and reasonable fees and documented and reasonable out-of-pocket, costs and expenses due to the Original |
(d) | Delivery of the Original Financial Statements. |
(e) | An up to date Group Structure Chart and list of Material Subsidiaries on the Signing Date. |
(f) | Evidence that a Process Agent has been appointed by the Borrower pursuant to Clause 38.2 (Service of process). |
(g) | A certificate from the Borrower confirming the aggregate amount secured by the existing security over assets of the Group has been provided no later than fifteen (15) days prior to the proposed Signing Date. |
(h) | A certificate from the Borrower confirming the aggregate amount of existing indebtedness of the Group has been provided no later than fifteen (15) days prior to the proposed Signing Date. |
(i) | A copy of any other Authorisation or other document, opinion or assurance which the Agent considers to be necessary or desirable (if it has notified the Obligors accordingly) in connection with the entry into and performance of the transactions contemplated by any Finance Document or for the validity and enforceability of any Finance Document. |
1. | Obligors |
(a) | A certified copy of the constitutional documents for the Borrower, including: |
(i) | an original or a certified copy of their constitutional documents and other by-laws; |
(ii) | their certificate of incorporation; |
(iii) | a certificate of good standing for the Borrower; |
(iv) | applicable uniform commercial code ("UCC") searches for the Borrower; and |
(v) | bankruptcy searches for the Borrower. |
(b) | In respect of the Borrower: |
(i) | a certified copy of a resolution of its board of supervisory directors (if any) approving the execution of, and the terms of, and the transactions contemplated by, the Finance Documents to which it is a party; and |
(ii) | authorising a specified person or persons to execute the Finance Documents to which it is a party. |
(c) | In respect of the Borrower, a secretary certificate signed by the company secretary or assistant secretary: |
(i) | certifying that each copy document relating to it specified in this Part 2 of Schedule 2 is correct, complete and in full force and effect and has not been amended or superseded as at the Signing Date; and |
(ii) | including a specimen signature of each person authorised to sign the Finance Documents and each Utilisation Request and any other related documents and evidence of such authorisation. |
(d) | In respect of the Borrower, a certificate signed by the Authorised Representative certifying that: |
(i) | utilisation by the Borrower of the Total Commitments in full would not breach any limit binding on it; |
(ii) | there is no Default or Event of Default at Signing Date; and |
(iii) | the Consolidated Total Net Leverage Ratio pro forma for the acquisitions of UGI Italia S.r.l. and DVEP Investeringen B.V. (the "Recent Acquisitions") as at the Signing Date is less than or equal to 3.5x.; |
(e) | A certified copy of the constitutional documents for the Dutch Security Grantor including: |
(i) | an up-to-date extract from the Dutch trade register (handelsregister) relating to it dated no earlier than five (5) Business Days prior to the date of this Agreement; |
(ii) | Deed of incorporation (Akte van oprichting); |
(iii) | Articles of association (statuten). |
(f) | In respect of the Dutch Security Grantor: |
(i) | a copy of a resolution of its board of supervisory directors approving the execution of, and the terms of, and the transactions contemplated by, the French Pledge; |
(ii) | authorising a specified person or persons to execute the French Pledge; |
(g) | In respect of the Dutch Security Grantor, a certificate signed by a director or officer who is authorised to represent the Dutch Security Grantor certifying that each copy document relating to it specified in this Part 1 of Schedule 2 is correct, complete and in full force and effect and has not been amended or superseded as at the Signing Date; |
(h) | A certified copy of the constitutional documents for UGI France including: |
(i) | an up-to-date extract from the French trade register relating to it dated no earlier than fifteen (15) Business Days prior to the date of this Agreement; |
(ii) | Articles of association. |
2. | Finance Documents |
(a) | any Fee Letter to be executed at the Utilisation Date; |
(b) | a Utilisation Request, substantially in the form set out at Part 1 of Schedule 3 (Requests) to this Agreement. |
3. | Other documents and evidence |
(a) | Evidence that, upon the Utilisation Date, all fees and reasonable out-of-pocket, costs and expenses due to the Original Lenders (and their legal counsels to the extent invoiced) on the Utilisation Date have been paid or will be paid in full on such date. |
(b) | A copy of any other Authorisation or other document, opinion or assurance which the Agent considers to be necessary or desirable (if it has notified the Security Grantors accordingly) in connection with the entry into and performance of the transactions contemplated by any Finance Document or for the validity and enforceability of any Finance Document. |
(c) | A Compliance Certificate (based on the unaudited consolidated financial statements of the Group as at 30 September 2017 or any more recent Accounts received by the Agent and in each case pro forma for the Recent Acquisitions) setting out (in reasonable detail) computations as to compliance with Clause 19 (Financial covenant). |
1. | We refer to the Agreement. This is a Utilisation Request. Terms defined in the Agreement have the same meaning in this Utilisation Request unless given a different meaning in this Utilisation Request. |
2. | We wish to borrow a Loan on the following terms: |
Proposed Utilisation Date: | [ ] (or, if that is not a Business Day, the next Business Day) |
Currency of Loan: | [ ] |
Amount: | [ ] or, if less, the Available Facility |
Interest Period: | [ ] |
3. | We confirm that each condition specified in Clause [4.2] (Further conditions precedent) of the Agreement is satisfied on the date of this Utilisation Request. |
4. | [This Loan is to be made in [whole]/[part] for the purpose of refinancing [identify maturing Loan]/[The proceeds of this Loan should be credited to [account]. |
5. | This Utilisation Request is irrevocable. |
1. | We refer to the Agreement. This is a Transfer Certificate. Terms defined in the Agreement have the same meaning in this Transfer Certificate unless given a different meaning in this Transfer Certificate. |
2. | We refer to Clause 22.6 (Procedure for transfer) of the Agreement: |
(a) | The Existing Lender and the New Lender agree to the Existing Lender transferring to the New Lender by novation, and in accordance with Clause 22.6 (Procedure for transfer) of the Agreement, all of the Existing Lender's rights and obligations under the Agreement and the other Finance Documents which relate to that portion of the Existing Lender's Commitment(s) and participations in Loans under the Agreement as specified in the Schedule. |
(b) | The proposed Transfer Date is [ ]. |
(c) | The Facility Office and address, fax number and attention details for notices of the New Lender for the purposes of Clause 29.2 (Addresses) of the Agreement are set out in the Schedule. |
3. | The New Lender expressly acknowledges the limitations on the Existing Lender's obligations set out in paragraph (c) of Clause 22.5 (Limitation of responsibility of Existing Lenders) of the Agreement. |
5. | This Transfer Certificate may be executed in any number of counterparts and this has the same effect as if the signatures on the counterparts were on a single copy of this Transfer Certificate. |
6. | This Transfer Certificate and any non-contractual obligations arising out of or in connection with it are governed by English law. |
7. | This Transfer Certificate has been entered into on the date stated at the beginning of this Transfer Certificate. |
[Existing Lender] | [New Lender] |
By: | By: |
[Agent] By: | |
[Security Agent] By: |
To: | [ ] as Agent, [ ] as Security Agent and [ ] as Borrower, for and on behalf of each Obligor |
From: | [the Existing Lender] (the "Existing Lender") and [the New Lender] (the "New Lender") |
1. | We refer to the Agreement. This is an Assignment Agreement. Terms defined in the Agreement have the same meaning in this Assignment Agreement unless given a different meaning in this Assignment Agreement. |
2. | We refer to Clause 22.7 (Procedure for assignment) of the Agreement: |
(a) | The Existing Lender assigns absolutely to the New Lender all the rights of the Existing Lender under the Agreement and the other Finance Documents which relate to that portion of the Existing Lender's Commitment(s) and participations in Loans under the Agreement as specified in the Schedule. |
(b) | The Existing Lender is released from all the obligations of the Existing Lender which correspond to that portion of the Existing Lender's Commitment(s) and participations in Loans under the Agreement specified in the Schedule. |
(c) | The New Lender becomes a Party as a Lender and is bound by obligations equivalent to those from which the Existing Lender is released under paragraph (b) above. |
3. | The proposed Transfer Date is [ ]. |
4. | On the Transfer Date the New Lender becomes Party to the Finance Documents as a Lender. |
5. | The Facility Office and address, fax number and attention details for notices of the New Lender for the purposes of Clause 29.2 (Addresses) of the Agreement are set out in the Schedule. |
6. | The New Lender expressly acknowledges the limitations on the Existing Lender's obligations set out in paragraph (c) of Clause 22.5 (Limitation of responsibility of Existing Lenders) of the Agreement. |
7. | The New Lender confirms, for the benefit of the Agent and without liability to any Obligor, that it is eligible to receive payments free and clear of any withholding tax. |
8. | This Assignment Agreement acts as notice to the Agent (on behalf of each Finance Party) and, upon delivery in accordance with Clause 22.8 (Copy of Transfer Certificate, Assignment Agreement or Increase Confirmation to Borrower) of the Agreement, to the Borrower (on behalf of each Obligor) of the assignment referred to in this Assignment Agreement. |
9. | This Assignment Agreement may be executed in any number of counterparts and this has the same effect as if the signatures on the counterparts were on a single copy of this Assignment Agreement. |
10. | This Assignment Agreement and any non-contractual obligations arising out of or in connection with it are governed by English law. |
11. | This Assignment Agreement has been entered into on the date stated at the beginning of this Assignment Agreement. |
[Agent] By: | |
[Security Agent] By: |
1. | We refer to the Agreement. This is a Compliance Certificate. Terms defined in the Agreement have the same meaning when used in this Compliance Certificate unless given a different meaning in this Compliance Certificate. |
2. | We confirm that: [Insert details of covenants to be certified] |
3. | [We confirm that no Default is continuing.]* |
Signed: | ….................. | ….................. |
Director | Director | |
Of | of | |
[Borrower] | [Borrower] |
Name of obligor | Security | Total Principal Amount of Indebtedness Secured |
UGI France | Security granted in connection with the UGI France Facility | €660,000,000 |
Various members of the Group | Capital Leases secured by the assets described therein | in aggregate of $920,315 |
Loans in euro | Loans in dollars | |
Delivery of a duly completed Utilisation Request (Clause 5.1 (Delivery of a Utilisation Request)) (Clause 9.1 (Selection of Interest Periods)) | U-3 11:00 am (Brussels time) | U-3 11:00 am (Brussels time) |
Agent determines (in relation to a Utilisation) the Base Currency Amount of the Loan, if required under Clause 5.4 (Lenders' participation) and notifies the Lenders of the Loan in accordance with Clause 5.4 (Lenders' participation) | U-3 17:00 (Brussels time) | U-3 17:00 (Brussels time) |
LIBOR or EURIBOR is fixed | Quotation Day 11:00 a.m. in respect of LIBOR and 11:00 a.m. (Brussels time) in respect of EURIBOR | Quotation Day 11:00 a.m. |
To: | [=] as Agent, [=] as Security Agent and [=] as Borrower, for and on behalf of each Obligor |
From: | [the Increase Lender] (the "Increase Lender") |
1. | We refer to the Agreement. This is an Increase Confirmation. Terms defined in the Agreement have the same meaning in this Increase Confirmation unless given a different meaning in this Increase Confirmation. |
2. | We refer to Clause 2.2 (Increase) of the Agreement. |
3. | The Increase Lender agrees to assume and will assume all of the obligations corresponding to the Commitment(s) specified in the Schedule (the "Relevant Commitment(s)") as if it had been an Original Lender under the Agreement in respect of the Relevant Commitment(s). |
4. | The proposed date on which the increase in relation to the Increase Lender and the Relevant Commitment(s) is to take effect (the "Increase Date") is [ ]. |
5. | On the Increase Date, the Increase Lender becomes party to the Finance Documents as a Lender. |
6. | The Facility Office and address, fax number and attention details for notices to the Increase Lender for the purposes of Clause 29.2 (Addresses) of the Agreement are set out in the Schedule. |
7. | The Increase Lender expressly acknowledges the limitations on the Lenders' obligations referred to in paragraph (i) of Clause 2.2 (Increase) of the Agreement. |
8. | The Increase Lender confirms, for the benefit of the Agent and without liability to any Obligor, that it is eligible to receive payments free and clear of any withholding tax. |
9. | This Increase Confirmation may be executed in any number of counterparts and this has the same effect as if the signatures on the counterparts were on a single copy of this Increase Confirmation. |
10. | This Increase Confirmation and any non-contractual obligations arising out of or in connection with it are governed by English law. |
11. | This Increase Confirmation has been entered into on the date stated at the beginning of this Increase Confirmation. |
[Agent] By: |
[Security Agent] By: |
/s/ G. Gary Garcia Signature Name: G. Gary Garcia Title: Treasurer |
/s/ Christine Laine Signature Name: Christine Laine Title: Corporate Loan Structuring | /s/ Marc Chevrette Signature Name: Marc Chevrette Title: Regional Director - France |
/s/ Joe Onischuk Signature Name: Joe Onischuk Title: Managing Director | /s/ Mark Renaud Signature Name: Mark Renaud Title: Managing Director |
/s/ Jean-Michael Fatovic Signature Name: Jean-Michael Fatovic Title: Managing Director | /s/ Gordon Yip Signature Name: Gordon Yip Title: Managing Director |
/s/ Helene Bloch Signature Name: Helene Bloch Title: ________________________ | /s/ Neil Mazumder Signature Name: Neil Mazumder Title: ________________________ |
/s/ Christelle Oberlin Signature Name: Christelle Oberlin Title: Head of Corporate Lending | /s/ Christophe Poos Signature Name: Christophe Poos Title: Head of Credit Risk |
/s/ Stefano Biondi Signature Name: Stefano Biondi Title: Chief Executive Officer | /s/ Antonio Santese Signature Name: Antonio Santese Title: Chief Risk Officer |
/s/ Christine Laine Signature Name: Christine Laine Title: Corporate Loan Structuring | /s/ Marc Chevrette Signature Name: Marc Chevrette Title: Regional Director - France |
/s/ Christine Laine Signature Name: Christine Laine Title: Corporate Loan Structuring | /s/ Axelle de Pesquidoux Signature Name: Axelle de Pesquidoux Title: Agency Officer |
1. | I have reviewed this periodic report on Form 10-Q of UGI Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: | February 6, 2018 | ||
/s/ John L. Walsh | |||
John L. Walsh President and Chief Executive Officer of UGI Corporation |
1. | I have reviewed this periodic report on Form 10-Q of UGI Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
(b) | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
(c) | Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
(d) | Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and |
5. | The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and |
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting. |
Date: | February 6, 2018 | ||
/s/ Kirk R. Oliver | |||
Kirk R. Oliver | |||
Chief Financial Officer of UGI Corporation |
(1) | The Company’s periodic report on Form 10-Q for the period ended December 31, 2017 (the “Form 10-Q”) fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended; and |
(2) | The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of the Company. |
CHIEF EXECUTIVE OFFICER | CHIEF FINANCIAL OFFICER | |||
/s/ John L. Walsh | /s/ Kirk R. Oliver | |||
John L. Walsh | Kirk R. Oliver | |||
Date: | February 6, 2018 | Date: | February 6, 2018 |
Document and Entity Information - shares |
3 Months Ended | |
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Dec. 31, 2017 |
Jan. 31, 2018 |
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Document and Entity Information [Abstract] | ||
Entity Registrant Name | UGI CORP /PA/ | |
Entity Central Index Key | 0000884614 | |
Document Type | 10-Q | |
Document Period End Date | Dec. 31, 2017 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2018 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 173,014,311 |
Condensed Consolidated Balance Sheets (unaudited) (Parenthetical) - USD ($) $ in Millions |
Dec. 31, 2017 |
Sep. 30, 2017 |
Dec. 31, 2016 |
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Statement of Financial Position [Abstract] | |||
Accounts receivable, allowances for doubtful accounts | $ 35.1 | $ 26.9 | $ 29.2 |
Property, plant and equipment, accumulated depreciation and amortization | $ 3,393.1 | $ 3,312.9 | $ 3,139.8 |
UGI Common Stock, without par value, shares authorized | 450,000,000 | 450,000,000 | 450,000,000 |
UGI Common Stock, without par value, shares issued | 173,997,441 | 173,987,691 | 173,903,191 |
Condensed Consolidated Statements of Comprehensive Income (unaudited) - USD ($) $ in Millions |
3 Months Ended | |
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Dec. 31, 2017 |
Dec. 31, 2016 |
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Statement of Comprehensive Income [Abstract] | ||
Net income including noncontrolling interests | $ 434.2 | $ 290.9 |
Other comprehensive income (loss): | ||
Net (losses) gains on derivative instruments (net of tax of $0.2 and $(6.0), respectively) | (0.4) | 12.3 |
Reclassifications of net gains on derivative instruments (net of tax of $0.1 and $2.1, respectively) | (0.4) | (4.5) |
Foreign currency adjustments | 22.3 | (70.9) |
Benefit plans (net of tax of $(0.2) and $(0.6), respectively) | 0.4 | 1.0 |
Other comprehensive income (loss) | 21.9 | (62.1) |
Comprehensive income including noncontrolling interests | 456.1 | 228.8 |
Deduct comprehensive income attributable to noncontrolling interests, principally in AmeriGas Partners | (68.3) | (60.2) |
Comprehensive income attributable to UGI Corporation | $ 387.8 | $ 168.6 |
Condensed Consolidated Statements of Comprehensive Income (unaudited) (Parenthetical) - USD ($) $ in Millions |
3 Months Ended | |
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Dec. 31, 2017 |
Dec. 31, 2016 |
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Statement of Comprehensive Income [Abstract] | ||
Tax on (loss) gain on derivative instruments | $ 0.2 | $ (6.0) |
Tax on reclassification on derivative instruments | 0.1 | 2.1 |
Tax on benefit plans | $ (0.2) | $ (0.6) |
Nature of Operations |
3 Months Ended |
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Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations | Note 1 — Nature of Operations UGI Corporation (“UGI”) is a holding company that, through subsidiaries and affiliates, distributes, stores, transports and markets energy products and related services. In the United States, we (1) are the general partner and own limited partner interests in a retail propane marketing and distribution business; (2) own and operate natural gas and electric distribution utilities; and (3) own and operate an energy marketing, midstream infrastructure, storage, natural gas gathering, natural gas production, electricity generation and energy services business. In Europe, we market and distribute propane and other liquefied petroleum gases (“LPG”) and market energy products and services. We refer to UGI and its consolidated subsidiaries collectively as “the Company,” “we” or “us.” We conduct a domestic propane marketing and distribution business through AmeriGas Partners, L.P. (“AmeriGas Partners”). AmeriGas Partners is a publicly traded limited partnership that conducts a national propane distribution business through its principal operating subsidiary AmeriGas Propane, L.P. (“AmeriGas OLP”). AmeriGas Partners and AmeriGas OLP are Delaware limited partnerships. UGI’s wholly owned second-tier subsidiary, AmeriGas Propane, Inc. (the “General Partner”), serves as the general partner of AmeriGas Partners and AmeriGas OLP. We refer to AmeriGas Partners and its subsidiaries together as the “Partnership” and the General Partner and its subsidiaries, including the Partnership, as “AmeriGas Propane.” At December 31, 2017, the General Partner held a 1% general partner interest and a 25.3% limited partner interest in AmeriGas Partners and held an effective 27.0% ownership interest in AmeriGas OLP. Our limited partnership interest in AmeriGas Partners comprises AmeriGas Partners Common Units (“Common Units”). The remaining 73.7% interest in AmeriGas Partners comprises Common Units held by the public. The General Partner also holds incentive distribution rights that entitle it to receive distributions from AmeriGas Partners in excess of its 1% general partner interest under certain circumstances as further described in Note 14 of the Company’s Annual Report on Form 10-K for the fiscal year ended September 30, 2017 (the “Company’s 2017 Annual Report”). Incentive distributions received by the General Partner during the three months ended December 31, 2017 and 2016 were $11.3 and $10.4, respectively. Our wholly owned subsidiary, UGI Enterprises, LLC, (“Enterprises”), through subsidiaries, conducts (1) an LPG distribution business throughout Europe, (2) a natural gas marketing business in France, Belgium and the United Kingdom, and (3) a natural gas and electricity marketing business in the Netherlands. These businesses are conducted principally through our subsidiaries, UGI France SAS, Flaga GmbH (“Flaga”), AvantiGas Limited, DVEP Investeringen B.V. (“DVEP”), and UniverGas Italia S.r.l. (“UniverGas”). We refer to our foreign operations collectively as “UGI International.” UGI Energy Services, LLC (“Energy Services, LLC”), a wholly owned subsidiary of Enterprises, conducts directly and through subsidiaries energy marketing, midstream transmission, liquefied natural gas (“LNG”), storage, natural gas gathering, natural gas production, electricity generation and energy services businesses primarily in the Mid-Atlantic region of the U.S. Energy Services, LLC’s wholly owned subsidiary, UGI Development Company (“UGID”), owns all or a portion of electricity generation facilities principally located in Pennsylvania. A first-tier subsidiary of Enterprises also conducts heating, ventilation, air-conditioning, refrigeration and electrical contracting businesses in portions of eastern and central Pennsylvania (“HVAC”). Energy Services, LLC and its subsidiaries’ storage, LNG and portions of its midstream transmission operations are subject to regulation by the Federal Energy Regulatory Commission (“FERC”). We refer to the businesses of Energy Services, LLC and its subsidiaries and HVAC as “Midstream & Marketing.” UGI Utilities, Inc. (“UGI Utilities”) conducts a natural gas distribution utility business (“Gas Utility”) directly and through its wholly owned subsidiaries, UGI Penn Natural Gas, Inc. (“PNG”) and UGI Central Penn Gas, Inc. (“CPG”). UGI Utilities, PNG and CPG own and operate natural gas distribution utilities in eastern and central Pennsylvania and in a portion of one Maryland county. UGI Utilities also owns and operates an electric distribution utility in northeastern Pennsylvania (“Electric Utility”). UGI Utilities’ natural gas distribution utility is referred to as “UGI Gas.” Gas Utility is subject to regulation by the Pennsylvania Public Utility Commission (“PUC”) and, with respect to a small service territory in one Maryland county, the Maryland Public Service Commission. Electric Utility is subject to regulation by the PUC. UGI Utilities is used herein as an abbreviated reference to UGI Utilities, Inc. or, collectively, UGI Utilities, Inc. and its subsidiaries. |
Summary of Significant Accounting Policies |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Summary of Significant Accounting Policies | Note 2 — Summary of Significant Accounting Policies The accompanying condensed consolidated financial statements are unaudited and have been prepared in accordance with the rules and regulations of the U.S. Securities and Exchange Commission (“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, 2017, condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America (“GAAP”). These financial statements should be read in conjunction with the financial statements and related notes included in the Company’s 2017 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. Earnings Per Common Share. Basic earnings per share attributable to UGI Corporation stockholders reflect the weighted-average number of common shares outstanding. Diluted earnings per share attributable to UGI Corporation include the effects of dilutive stock options and common stock awards. Shares used in computing basic and diluted earnings per share are as follows:
Derivative Instruments. Derivative instruments are reported on the condensed consolidated balance sheets at their fair values, unless the derivative instruments qualify for the normal purchase and normal sale (“NPNS”) exception. The accounting for changes in fair value depends upon the purpose of the derivative instrument and whether it is designated and qualifies for hedge accounting. Certain of our derivative instruments are designated and qualify as cash flow hedges and from time to time we also enter into net investment hedges. For cash flow hedges, changes in the fair values of the derivative instruments are recorded in accumulated other comprehensive income (loss) (“AOCI”), to the extent effective at offsetting changes in the hedged item, until earnings are affected by the hedged item. We discontinue cash flow hedge accounting if occurrence of the forecasted transaction is determined to be no longer probable. Hedge accounting is also discontinued for derivatives that cease to be highly effective. Gains and losses on net investment hedges that relate to our foreign operations are included in AOCI until such foreign net investment is sold or liquidated. Unrealized gains and losses on substantially all of the commodity derivative instruments used by UGI Utilities (for which NPNS has not been elected) are included in regulatory assets or liabilities because it is probable such gains or losses will be recoverable from, or refundable to, customers. Beginning October 1, 2016, in order to reduce the volatility in net income associated with our foreign operations, principally as a result of changes in the U.S. dollar exchange rate between the euro and British pound sterling, we have entered into forward foreign currency exchange contracts. Because these contracts do not qualify for hedge accounting treatment, realized and unrealized gains and losses on these contracts are recorded in “(Losses) gains on foreign currency contracts, net” on the Condensed Consolidated Statements of Income. Cash flows from derivative instruments, other than net investment hedges and certain cross-currency swaps, if any, are included in cash flows from operating activities on the Condensed Consolidated Statements of Cash Flows. Cash flows from net investment hedges, if any, are included in cash flows from investing activities on the Condensed Consolidated Statements of Cash Flows. Cash flows from the interest portion of our cross-currency hedges, if any, are included in cash flow from operating activities while cash flows from the currency portion of such hedges, if any, are included in cash flow from financing activities. For a more detailed description of the derivative instruments we use, our accounting for derivatives, our objectives for using them and other information, see Note 13. Income Taxes. UGI’s consolidated effective income tax rate, defined as total income taxes as a percentage of income (loss) before income taxes, includes amounts associated with noncontrolling interests in the Partnership, which principally comprises AmeriGas Partners and AmeriGas OLP. AmeriGas Partners and AmeriGas OLP are not directly subject to federal income taxes. As a result, UGI’s consolidated effective income tax rate is affected by the amount of income (loss) before income taxes attributable to noncontrolling interests in the Partnership not subject to income taxes. See Note 5 for discussions regarding the December 22, 2017, enactment of the Tax Cuts and Jobs Act in the U.S. and changes in French tax laws. Use of Estimates. The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and costs. These estimates are based on management’s knowledge of current events, historical experience and various other assumptions that are believed to be reasonable under the circumstances. Accordingly, actual results may be different from these estimates and assumptions. Reclassifications. Certain prior period amounts have been reclassified to conform to the current-period presentation. |
Accounting Changes |
3 Months Ended |
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Dec. 31, 2017 | |
New Accounting Pronouncements and Changes in Accounting Principles [Abstract] | |
Accounting Changes | Note 3 — Accounting Changes Accounting Standards Not Yet Adopted Derivatives and Hedging. In August 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") No. 2017-12, “Targeted Improvements to Accounting for Hedging Activities.” This ASU amends and simplifies existing guidance to allow companies to more accurately present the economic effects of risk management activities in the financial statements. The amendments in this ASU are effective for interim and annual periods beginning after December 15, 2018 (Fiscal 2020). Early adoption is permitted. For cash flow and net investment hedges as of the adoption date, the guidance requires a modified retrospective approach. The amended presentation and disclosure guidance is required only prospectively. The Company is in the process of assessing the impact on its financial statements from the adoption of the new guidance and determining the period in which the new guidance will be adopted. Pension and Other Postretirement Benefit Costs. In March 2017, the FASB issued ASU No. 2017-07, “Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost.” This ASU requires entities to disaggregate the service cost component from the other components of net periodic benefit costs and present it with compensation costs for related employees in the income statement. The other components are required to be presented elsewhere in the income statement and outside of operating income. The amendments in this ASU permit only the service cost component to be eligible for capitalization when applicable. The amendments in this ASU are effective for interim and annual periods beginning after December 15, 2017 (Fiscal 2019). The amendments in the ASU should generally be adopted on a retrospective basis. The Company is in the process of assessing the impact on its financial statements from the adoption of the new guidance. Restricted Cash. In November 2016, the FASB issued ASU No. 2016-18, “Statement of Cash Flows: Restricted Cash.” This ASU provides guidance on the classification of restricted cash in the statement of cash flows. The amendments in this ASU are effective for interim and annual periods beginning after December 15, 2017 (Fiscal 2019). Early adoption is permitted. The amendments in the ASU are required to be adopted on a retrospective basis. The Company is in the process of assessing the impact on its financial statements from the adoption of the new guidance and determining the period in which the new guidance will be adopted. Leases. In February 2016, the FASB issued ASU No. 2016-02, "Leases." This ASU amends existing guidance to require entities that lease assets to recognize the assets and liabilities for the rights and obligations created by those leases on the balance sheet. The new guidance also requires additional disclosures about the amount, timing and uncertainty of cash flows from leases. The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2018 (Fiscal 2020). Early adoption is permitted. Lessees must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company is in the process of assessing the impact on its financial statements from the adoption of the new guidance and determining the period in which the new guidance will be adopted but anticipates an increase in the recognition of right-of-use assets and lease liabilities. Revenue Recognition. In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers.” (“ASU 2014-09”) The guidance provided under this ASU, as amended, supersedes the revenue recognition requirements in Accounting Standards Codification (“ASC”) No. 605, “Revenue Recognition,” and most industry-specific guidance included in the ASC. ASU 2014-09 requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new guidance is effective for the Company for interim and annual periods beginning after December 15, 2017 (Fiscal 2019) and allows for either full retrospective adoption or modified retrospective adoption. The Company is in the process of analyzing the impact of the new guidance using an integrated approach which includes evaluating differences in the amount and timing of revenue recognition from applying the requirements of the new guidance, reviewing its accounting policies and practices, and assessing the need for changes to its processes, accounting systems and design of internal controls. The Company has completed the assessment of a significant number of its contracts with customers under the new guidance to determine the effect of the adoption of the new guidance. Although the Company has not completed its assessment of the impact of the new guidance, the Company does not expect its adoption will have a material impact on its consolidated financial statements. The Company continues to monitor developments associated with certain utility industry specific guidance for possible impacts on the recognition of revenue by UGI Utilities. The Company currently anticipates that it will adopt the new standard using the modified retrospective transition method effective October 1, 2018. The ultimate decision with respect to the transition method that it will use will depend upon the completion of the Company’s analysis including confirming its preliminary conclusion that the adoption of the new guidance will not have a material impact on its consolidated financial statements. |
Inventories |
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Inventories | Note 4 — Inventories Inventories comprise the following:
At December 31, 2017, UGI Utilities was a party to five principal storage contract administrative agreements (“SCAAs”) which have terms of up to three years. Pursuant to SCAAs, UGI Utilities has, among other things, released certain storage and transportation contracts for the terms of the SCAAs. UGI Utilities also transferred certain associated storage inventories upon commencement of the SCAAs, will receive a transfer of storage inventories at the end of the SCAAs, and makes payments associated with refilling storage inventories during the terms of the SCAAs. The historical cost of natural gas storage inventories released under the SCAAs, which represents a portion of Gas Utility’s total natural gas storage inventories, and any exchange receivable (representing amounts of natural gas inventories used by the other parties to the agreement but not yet replenished for which UGI Utilities has the rights), are included in the caption “Gas Utility natural gas” in the table above. As of December 31, 2017, UGI Utilities had SCAAs with Energy Services, LLC, the effects of which are eliminated in consolidation, and with a non-affiliate. The carrying value of gas storage inventories released under the SCAAs with the non-affiliate at December 31, 2017, September 30, 2017 and December 31, 2016, comprising 1.8 billion cubic feet (“bcf”), 2.3 bcf and 1.9 bcf of natural gas, was $5.1, $6.7 and $4.8, respectively. |
Income Taxes |
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Income Tax Disclosure [Abstract] | |||||||||||||
Income Tax Reform | Note 5 — Income Tax Reform U.S. Tax Reform On December 22, 2017, the Tax Cuts and Jobs Act (the “TCJA”) was enacted into law. Among the significant changes resulting from the law, the TCJA reduces the U.S. federal income tax rate from 35% to 21% effective January 1, 2018, creates a territorial tax system with a one-time mandatory “toll tax” on previously unrepatriated foreign earnings, and allows for immediate capital expensing of certain qualified property. It also applies restrictions on the deductibility of interest expense, eliminates bonus depreciation for regulated utilities and applies a broader application of compensation limitations. In accordance with GAAP as determined by ASC 740, “Income Taxes,” we are required to record the effects of tax law changes in the period enacted. As further discussed below, our results for the three months ended December 31, 2017, contain provisional estimates of the impact of the TCJA. These amounts are considered provisional because they use estimates for which tax returns have not yet been filed and because estimated amounts may be impacted by future regulatory and accounting guidance if and when issued. We will adjust these provisional amounts as further information becomes available and as we refine our calculations. As permitted by recent guidance issued by the SEC, these adjustments will occur during a reasonable “measurement period” not to exceed twelve months from the date of enactment. As a result, during the three months ended December 31, 2017, we reduced our net deferred income tax liabilities by $383.8 due to the remeasuring of our existing federal deferred income tax assets and liabilities as of the date of the enactment. Because part of the reduction to our net deferred income taxes relates to UGI Utilities’ regulated utility plant assets as further described below, most of UGI Utilities’ reduction in deferred income taxes is not being recognized immediately in income tax expense. Discrete deferred income tax adjustments recorded during the three months ended December 31, 2017, which reduced income tax expense, totaled $166.0 (equal to $0.96 per basic share and $0.94 per diluted share) and consisted primarily of the following items:
In order for UGI Utilities’ regulated utility plant assets to continue to be eligible for accelerated tax depreciation, current law requires that excess deferred income taxes be amortized no more rapidly than over the remaining lives of the assets that gave rise to the excess deferred income taxes. At December 31, 2017, UGI Utilities has recorded a regulatory liability of $216.1 associated with excess deferred federal income taxes related to its regulated utility plant assets. This regulatory liability has been increased, and a federal deferred income tax asset has been recorded, in the amount of $87.8 to reflect the tax benefit generated by the amortization of the excess deferred federal income taxes. For further information on this regulatory liability, see Note 7 to condensed consolidated financial statements. For the three months ended December 31, 2017, we included the estimated impacts of the TCJA in determining our estimated annual effective income tax rate. We are subject to a blended federal tax rate of 24.5% for Fiscal 2018 because our fiscal year contains the effective date of the rate change from 35% to 21%. As a result, the U.S. federal income tax rate included in our estimated annual effective tax rate is based on this 24.5% blended rate for fiscal year 2018. For the three months ended December 31, 2017, the effects of the tax law changes on current-period results (excluding the one-time impacts described above) decreased income tax expense, and increased net income attributable to UGI, by approximately by $20.4. Regarding UGI Utilities, the PUC has not issued any orders with respect to the lower income tax rate. Our estimated annual effective tax rate for Fiscal 2018 does not reflect the impact of any regulatory action that may be taken by the PUC with respect to the TCJA. Changes in French Corporate Income Tax Rates In December 2017, the French Parliament approved the Finance Bill for 2018 and the second amended Finance Bill for 2017 (collectively, the “December 2017 French Finance Bills”). One impact of the December 2017 French Finance Bills is an increase in the Fiscal 2018 corporate income tax rate in France to 39.4% from 34.4% previously. The December 2017 French Finance Bills also include measures to reduce the corporate income tax rate to 25.8% effective for fiscal years starting after January 1, 2022 (Fiscal 2023). As a result of the future corporate income tax rate reduction effective in Fiscal 2023, during the three months ended December 31, 2017, the Company reduced its net French deferred income tax liabilities and recognized an estimated deferred tax benefit of $17.3 (equal to $0.10 per basic and diluted share). The estimated annual effective income tax rate used in determining income taxes for the three months ended December 31, 2017, reflects the impact of the single year Fiscal 2018 income tax rate as a result of the December 2017 French Finance Bills. The impact of the single year rate change increased income tax expense for the three months ended December 31, 2017, by $3.9. In December 2016, the French Parliament approved the Finance Bill for 2017 and amended the Finance Bill for 2016 (collectively, the “December 2016 French Finance Bills”). The December 2016 French Finance Bills, among other things, will reduce UGI France’s corporate income tax rate from the then-current 34.4% to 28.9%, effective for fiscal years starting after January 1, 2020 (Fiscal 2021). As a result of this future income tax rate reduction, during the three months ended December 31, 2016, the Company reduced its net French deferred income tax liabilities and recognized an estimated deferred tax benefit of $27.4 (equal to $0.15 per basic and diluted share). |
Goodwill and Intangible Assets |
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Goodwill and Intangible Assets | Note 6 — Goodwill and Intangible Assets Goodwill and intangible assets comprise the following:
The changes in goodwill and intangible assets are primarily due to acquisitions and the effects of currency translation. Amortization expense of intangible assets was $14.8 and $12.5 for the three months ended December 31, 2017 and 2016, respectively. Amortization expense included in “Cost of sales” on the Condensed Consolidated Statements of Income was not material. The estimated aggregate amortization expense of intangible assets for the remainder of Fiscal 2018 and for the next four fiscal years is as follows: remainder of Fiscal 2018 — $42.8; Fiscal 2019 — $55.1; Fiscal 2020 — $53.7; Fiscal 2021 — $51.9; Fiscal 2022 — $50.2. |
Utility Regulatory Assets and Liabilities and Regulatory Matters |
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Regulated Operations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Utility Regulatory Assets and Liabilities and Regulatory Matters | Note 7 — Utility Regulatory Assets and Liabilities and Regulatory Matters For a description of the Company’s regulatory assets and liabilities other than those described below, see Note 8 in the Company’s 2017 Annual Report. Other than removal costs, UGI Utilities currently does not recover a rate of return on its regulatory assets. The following regulatory assets and liabilities associated with UGI Utilities are included in our accompanying condensed consolidated balance sheets:
Deferred fuel and power refunds. Gas Utility’s and Electric Utility’s tariffs contain clauses that permit recovery of all prudently incurred purchased gas and power costs through the application of purchased gas cost (“PGC”) rates in the case of Gas Utility and default service (“DS”) tariffs in the case of Electric Utility. The clauses provide for periodic adjustments to PGC and DS rates for differences between the total amount of purchased gas and electric generation supply costs collected from customers and recoverable costs incurred. Net undercollected costs are classified as a regulatory asset and net overcollections are classified as a regulatory liability. Gas Utility uses derivative instruments to reduce volatility in the cost of gas it purchases for firm- residential, commercial and industrial (“retail core-market”) customers. Realized and unrealized gains or losses on natural gas derivative instruments are included in deferred fuel costs or refunds. Net unrealized (losses) gains on such contracts at December 31, 2017, September 30, 2017 and December 31, 2016 were $(1.7), $0.1 and $6.9, respectively. In order to reduce volatility associated with a substantial portion of its electric transmission congestion costs, Electric Utility obtains financial transmission rights (“FTRs”). FTRs are derivative instruments that entitle the holder to receive compensation for electricity transmission congestion charges when there is insufficient electricity transmission capacity on the electric transmission grid. Because Electric Utility is entitled to fully recover its DS costs, realized and unrealized gains or losses on FTRs are included in deferred fuel and power costs or deferred fuel and power refunds. Unrealized gains or losses on FTRs at December 31, 2017, September 30, 2017, and December 31, 2016, were not material. Excess federal deferred income taxes. This regulatory liability is the result of remeasuring UGI Utilities’ federal deferred income tax liabilities on utility plant due to the enactment of the TCJA on December 22, 2017 (see Note 5). In order for our utility assets to continue to be eligible for accelerated tax depreciation, current law requires that these excess federal deferred income taxes be amortized no more rapidly than over the remaining lives of the assets that gave rise to the excess federal deferred income taxes, ranging from 1 year to approximately 65 years. This regulatory liability has been increased to reflect the tax benefit generated by the amortization of the excess deferred federal income taxes. This regulatory liability will be amortized and credited to tax expense. Other Regulatory Matters Base Rate Filings. On January 26, 2018, Electric Utility filed a rate request with the PUC to increase its annual base distribution revenues by $9.2. The increased revenues would fund ongoing system improvements and operations necessary to maintain safe and reliable electric service. Electric Utility requested that the new electric rates become effective March 27, 2018, although the PUC typically suspends the effective date for general base rate proceedings to allow for investigation and public hearings. This review process is expected to last up to nine months; however, the Company cannot predict the timing or the ultimate outcome of the rate case review process. On August 31, 2017, the PUC approved a previously filed Joint Petition for Approval of Settlement of all issues providing for an $11.3 annual base distribution rate increase for PNG. The increase became effective on October 20, 2017. On October 14, 2016, the PUC approved a previously filed Joint Petition for Approval of Settlement of all issues providing for a $27.0 annual base distribution rate increase for UGI Gas. The increase became effective on October 19, 2016. Distribution System Improvement Charge. State legislation permits gas and electric utilities in Pennsylvania to recover a distribution system improvement charge (“DSIC”) on eligible capital investments as an alternative ratemaking mechanism providing for a more-timely cost recovery of qualifying capital expenditures between base rate cases. PNG and CPG received PUC approval on a DSIC tariff, initially set at zero, in 2014. PNG and CPG began charging a DSIC at a rate other than zero beginning on April 1, 2015 and April 1, 2016, respectively. In May 2017, the PUC issued a final Order to approve an increase of the maximum allowable DSIC to 7.5% of billed distribution revenues effective July 1, 2017, for PNG and CPG, pending reconsideration at each company’s Long-term Infrastructure Improvement Plan filing in 2018. PNG’s DSIC has been reset to zero as a result of its most recent rate case. The DSIC rate for PNG will resume upon exceeding the threshold amount of DSIC-eligible plant in service agreed upon in the settlement of its recent base rate case. In November 2016, UGI Gas received PUC approval to establish a DSIC tariff mechanism, capped at 5% of distribution charges billed to customers, effective January 1, 2017. UGI Gas will be permitted to recover revenue under the mechanism for the amount of DSIC-eligible plant placed into service in excess of the threshold amount of DSIC-eligible plant agreed upon in the settlement of its recent base rate case. |
Energy Services Accounts Receivable Securitization Facility |
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Transfers and Servicing [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Energy Services Accounts Receivable Securitization Facility | Note 8 — Energy Services Accounts Receivable Securitization Facility Energy Services, LLC has an accounts receivable securitization facility (“Receivables Facility”) with an issuer of receivables-backed commercial paper currently scheduled to expire in October 2018. The Receivables Facility, as amended, provides Energy Services, LLC with the ability to borrow up to $150 of eligible receivables during the period November to April and up to $75 of eligible receivables during the period May to October. Energy Services, LLC uses the Receivables Facility to fund working capital, margin calls under commodity futures contracts, capital expenditures, dividends and for general corporate purposes. Under the Receivables Facility, Energy Services, LLC transfers, on an ongoing basis and without recourse, its trade accounts receivable to its wholly owned, special purpose subsidiary, Energy Services Funding Corporation (“ESFC”), which is consolidated for financial statement purposes. ESFC, in turn, has sold and, subject to certain conditions, may from time to time, sell an undivided interest in some or all of the receivables to a major bank. Amounts sold to the bank are reflected as “Short-term borrowings” on the Condensed Consolidated Balance Sheets. ESFC was created and has been structured to isolate its assets from creditors of Energy Services, LLC and its affiliates, including UGI. Trade receivables sold to the bank remain on Energy Services LLC’s balance sheet and Energy Services, LLC reflects a liability equal to the amount advanced by the bank. The Company records interest expense on amounts owed to the bank. Energy Services, LLC continues to service, administer and collect trade receivables on behalf of the bank, as applicable. Losses on sales of receivables to the bank during the three months ended December 31, 2017 and 2016, which are included in “Interest expense” on the Condensed Consolidated Statements of Income, were not material. Information regarding the trade receivables transferred to ESFC and the amounts sold to the bank for the three months ended December 31, 2017 and 2016, as well as the balance of ESFC trade receivables at December 31, 2017, September 30, 2017 and December 31, 2016, is as follows:
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Debt |
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Debt Disclosure [Abstract] | |
Debt | Note 9 — Debt AmeriGas Propane. In December 2017, AmeriGas Partners entered into the Second Amended and Restated Credit Agreement (“AmeriGas Credit Agreement”) with a group of banks. The AmeriGas Credit Agreement amends and restates a previous credit agreement. The AmeriGas Credit Agreement provides for borrowings up to $600 (including a $150 sublimit for letters of credit) and expires in December 2022. The AmeriGas Credit Agreement permits AmeriGas to borrow at prevailing interest rates, including the base rate, defined as the higher of the Federal Funds rate plus 0.50% or the agent bank’s prime rate, or at a one-week, one-, two-, three-, or six-month Eurodollar Rate, as defined in the AmeriGas Credit Agreement, plus a margin. Under the AmeriGas Credit Agreement, the applicable margin on base rate borrowings ranges from 0.50% to 1.75%; the applicable margin on Eurodollar Rate borrowings ranges from 1.50% to 2.75%; and the facility fee ranges from 0.30% to 0.50%. The aforementioned margins and facility fees are dependent upon AmeriGas Partners’ ratio of debt to earnings before interest expense, income taxes, depreciation and amortization (each as defined in the AmeriGas Credit Agreement). In December 2016, the Partnership recognized a pre-tax loss of $33.2 in connection with the early repayment of a portion of AmeriGas Partners’ 7.00% Senior Notes. This loss is reflected in “Loss on extinguishments of debt” on the Condensed Consolidated Statements of Income for the three months ended December 31, 2016. UGI International. In December 2017, UGI International, LLC, a wholly owned subsidiary of UGI, entered into a secured multicurrency revolving facility agreement (the "UGI International Credit Agreement") with a group of banks providing for borrowings up to €300. The UGI International Credit Agreement is scheduled to expire in April 2020. Under the UGI International Credit Agreement, UGI International, LLC may borrow in euros or U.S. dollars. Loans made in euros will bear interest at the associated euribor rate plus a margin ranging from 1.45% to 2.35%. Loans made in U.S. dollars will bear interest at LIBOR plus a margin ranging from 1.70% to 2.60%. The aforementioned margins are dependent upon certain indebtedness at UGI International, LLC. The UGI International Credit Agreement requires UGI International, LLC not to exceed a ratio of total indebtedness to EBITDA, as defined, of 3.50 to 1.00. Also in December 2017, Flaga repaid $9.2 of the outstanding principal amount of its then-existing $59.1 U.S. dollar denominated variable-rate term loan due September 2018. Concurrently, Flaga entered into an amendment to the aforementioned term loan, which amends and restates the previous agreement to provide for a principal balance of $49.9 and extends the maturity of the term loan to April 2020 (“Flaga Term Loan”). The outstanding principal bears interest at the one-month LIBOR rate plus a margin of 1.125%. Flaga has effectively fixed the LIBOR component of the interest rate, and has effectively fixed the U.S. dollar value of the interest and principal payments payable under the Flaga Term Loan, by entering into a cross-currency swap arrangement with a bank. Because a portion of the cash flows related to the Flaga Term Loan were with the same bank, such cash flows have been reflected “net” in the financing activities section of the Condensed Consolidated Statement of Cash Flows. UGI Utilities. In October 2017, UGI Utilities entered into a $125 unsecured variable-rate term loan agreement (the “Utilities Term Loan”) with a group of banks which initially matures on October 30, 2018. Such maturity will be automatically extended to October 30, 2022, after UGI Utilities receives a securities certificate from the PUC authorizing issuance of the security and upon delivery of such certificate to the agent. Proceeds from the Utilities Term Loan were used to repay revolving credit balances and for general corporate purposes. The outstanding principal amount of the Utilities Term Loan is payable in equal quarterly installments of $1.6 with the balance of the principal being due and payable in full on the maturity date. Under the Utilities Term Loan, UGI Utilities may borrow at various prevailing market interest rates, including LIBOR and the banks’ prime rate, plus a margin. The margin on such borrowings ranges from 0.0% to 1.875% and is based upon the credit ratings of certain indebtedness of UGI Utilities. The Utilities Term Loan requires UGI Utilities to not exceed a ratio of Consolidated Debt to Consolidated Total Capital, as defined. Because UGI Utilities has not yet received a securities certificate from the PUC authorizing the extension of the maturity date to October 30, 2022, the Utilities Term Loan has been reflected in “Current maturities of long-term debt” on the December 31, 2017, Condensed Consolidated Balance Sheet. |
Commitments and Contingencies |
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Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 10 — Commitments and Contingencies UGI Standby Commitment to Purchase AmeriGas Partners Class B Common Units On November 7, 2017, UGI entered into a Standby Equity Commitment Agreement (the “Commitment Agreement”) with AmeriGas Partners and AmeriGas Propane, Inc. Under the terms of the Commitment Agreement, UGI has committed to make up to $225 of capital contributions to the Partnership through July 1, 2019 (the “Commitment Period”). UGI’s capital contributions may be made from time to time during the Commitment Period upon request of the Partnership. There have been no capital contributions made to the Partnership under the Commitment Agreement. In consideration for any capital contributions made pursuant to the Commitment Agreement, the Partnership will issue to UGI or a wholly owned subsidiary new Class B Common Units representing limited partner interests in the Partnership (“Class B Units”). The Class B Units will be issued at a price per unit equal to the 20-day volume-weighted average price of AmeriGas Partners Common Units prior to the date of the Partnership’s related capital call. The Class B Units will be entitled to cumulative quarterly distributions at a rate equal to the annualized Common Unit yield at the time of the applicable capital call, plus 130 basis points. The Partnership may choose to make the distributions in cash or in the form of additional Class B Units. While outstanding, the Class B Units will not be subject to any incentive distributions from the Partnership. At any time after five years from the initial issuance of the Class B Units, holders may elect to convert all or any portion of the Class B Units they own into Common Units on a one-for-one basis, and at any time after six years from the initial issuance of the Class B Units, the Partnership may elect to convert all or any portion of the Class B Units into Common Units if (i) the closing trading price of the Common Units is greater than 110% of the applicable purchase price for the Class B Units and (ii) the Common Units are listed or admitted for trading on a National Securities Exchange. Upon certain events involving a change of control and immediately prior to a liquidation or winding up of the Partnership, the Class B Units will automatically convert into Common Units on a one-for-one basis. Environmental Matters UGI Utilities From the late 1800s through the mid-1900s, UGI Utilities and its current and former subsidiaries owned and operated a number of manufactured gas plants (“MGPs”) prior to the general availability of natural gas. Some constituents of coal tars and other residues of the manufactured gas process are today considered hazardous substances under the Superfund Law and may be present on the sites of former MGPs. Between 1882 and 1953, UGI Utilities owned the stock of subsidiary gas companies in Pennsylvania and elsewhere and also operated the businesses of some gas companies under agreement. By the early 1950s, UGI Utilities divested all of its utility operations other than certain Pennsylvania operations, including those which now constitute UGI Gas and Electric Utility. UGI Utilities also has two acquired subsidiaries (CPG and PNG) with similar histories of owning, and in some cases operating, MGPs in Pennsylvania. Each of UGI Utilities and its subsidiaries, CPG and PNG, has entered into a consent order and agreement (“COA”) with the Pennsylvania Department of Environmental Protection (“DEP”) to address the remediation of former MGPs in Pennsylvania. In accordance with the COAs, UGI Utilities, CPG and PNG are each required to either obtain a certain number of points per calendar year based on defined eligible environmental investigatory and/or remedial activities at the MGPs or make expenditures for such activities in an amount equal to an annual environmental cost cap. The CPG COA includes an obligation to plug specified natural gas wells. The COA environmental costs caps are $2.5, $1.8, and $1.1, for UGI Utilities, CPG and PNG, respectively. The COAs for UGI Utilities, CPG and PNG are scheduled to terminate at the end of 2031, 2018, and 2019, respectively. At December 31, 2017, September 30, 2017 and December 31, 2016, our estimated accrued liabilities for environmental investigation and remediation costs related to the COAs for UGI Utilities, CPG and PNG totaled $53.4, $54.3 and $55.3, respectively. UGI Utilities, CPG and PNG have recorded associated regulatory assets for these costs because recovery of these costs from customers is probable (see Note 7). We do not expect the costs for investigation and remediation of hazardous substances at Pennsylvania MGP sites to be material to UGI Utilities’ results of operations because UGI Utilities, CPG and PNG receive ratemaking recovery of actual environmental investigation and remediation costs associated with the sites covered by the COAs. This ratemaking recognition reconciles the accumulated difference between historical costs and rate recoveries with an estimate of future costs associated with the sites. From time to time, UGI Utilities is notified of sites outside Pennsylvania on which private parties allege MGPs were formerly owned or operated by UGI Utilities or owned or operated by a former subsidiary. Such parties generally investigate the extent of environmental contamination or perform environmental remediation. Management believes that, under applicable law, UGI Utilities should not be liable in those instances in which a former subsidiary owned or operated an MGP. There could be, however, significant future costs of an uncertain amount associated with environmental damage caused by MGPs outside Pennsylvania that UGI Utilities directly operated, or that were owned or operated by a former subsidiary of UGI Utilities if a court were to conclude that (1) the subsidiary’s separate corporate form should be disregarded, or (2) UGI Utilities should be considered to have been an operator because of its conduct with respect to its subsidiary’s MGP. At December 31, 2017, September 30, 2017 and December 31, 2016, neither the undiscounted nor the accrued liability for environmental investigation and cleanup costs for UGI Utilities’ MGP sites outside of Pennsylvania was material. AmeriGas Propane AmeriGas OLP Saranac Lake. By letter dated March 6, 2008, the New York State Department of Environmental Conservation (“DEC”) notified AmeriGas OLP that the DEC had placed property purportedly owned by AmeriGas OLP in Saranac Lake, New York on the New York State Registry of Inactive Hazardous Waste Disposal Sites. A site characterization study performed by the DEC disclosed contamination related to a former MGP. At that time, AmeriGas OLP reviewed the study and researched the history of the site, including the extent of AmeriGas OLP’s ownership. In its written response to the DEC in early 2009, AmeriGas OLP disputed DEC’s contention it was a potentially responsible party (“PRP”) as it did not operate the MGP and appeared to only own a portion of the site. The DEC did not respond to the 2009 communication. In March 2017, the DEC communicated to AmeriGas OLP that the DEC had previously issued three Records of Decision (“RODs”) related to the site and requested additional information regarding AmeriGas OLP’s purported ownership. The selected remedies identified in the RODs total approximately $27.7. To AmeriGas OLP’s knowledge, the DEC has not yet commenced implementation of the remediation plan but remediation is currently expected to commence in 2018. AmeriGas OLP responded to the DEC’s March 2017 request for ownership information, renewing its challenge to designation as a PRP and identifying potential defenses. In October 2017, the DEC identified a third party PRP with respect to the site. Based on our evaluation of the available information, during the third quarter of Fiscal 2017, the Partnership accrued an environmental remediation liability of $7.5 related to the site. Our share of the actual remediation costs could be significantly more or less than the accrued amount. Other Matters Purported Class Action Lawsuits. Between May and October of 2014, more than 35 purported class action lawsuits were filed in multiple jurisdictions against the Partnership/UGI and a competitor by certain of their direct and indirect customers. The class action lawsuits allege, among other things, that the Partnership and its competitor colluded, beginning in 2008, to reduce the fill level of portable propane cylinders from 17 pounds to 15 pounds and combined to persuade their common customer, Walmart Stores, Inc., to accept that fill reduction, resulting in increased cylinder costs to retailers and end-user customers in violation of federal and certain state antitrust laws. The claims seek treble damages, injunctive relief, attorneys’ fees and costs on behalf of the putative classes. On October 16, 2014, the United States Judicial Panel on Multidistrict Litigation transferred all of these purported class action cases to the Western Division of the United States District Court for the Western District of Missouri (“District Court”). In July 2015, the District Court dismissed all claims brought by direct customers. In June 2017, the United States Court of Appeals for the Eighth Circuit (“Eighth Circuit”) ruled en banc to reverse the dismissal by the District Court, which had previously been affirmed by a panel of the Eighth Circuit. In September 2017, we filed a Petition for a Writ of Certiorari to the U.S. Supreme Court appealing the decision of the Eighth Circuit. The petition was denied in January 2018 and, as a result, the case was transferred back to the District Court for further proceedings. In July 2015, the District Court also dismissed all claims brought by the indirect customers other than those for injunctive relief. The indirect customers filed an amended complaint with the District Court claiming injunctive relief and state law claims under Wisconsin, Maine and Vermont law. In September 2016, the District Court dismissed the amended complaint in its entirety. The indirect customers appealed this decision to the Eighth Circuit; such appeal was subject to a stay pending the en banc review of the direct purchasers’ claims. In light of the Eighth Circuit decision with respect to the direct purchaser claims, the briefing schedule in respect of the indirect purchaser appeal will now resume. On July 21, 2016, several new indirect customer plaintiffs filed an antitrust class action lawsuit against the Partnership in the Western District of Missouri. The new indirect customer class action lawsuit was dismissed in September 2016 and certain indirect customer plaintiffs appealed the decision, consolidating their appeal with the indirect customer appeal still pending in the Eighth Circuit. Now that the Eighth Circuit has ruled on the direct purchasers’ claims, the stay has been lifted for the indirect claims and the parties submitted briefs in October 2017 to the Eighth Circuit and are awaiting the court’s ruling. We are unable to reasonably estimate the impact, if any, arising from such litigation. We believe we have strong defenses to the claims and intend to vigorously defend against them. In addition to the matters described above, there are other pending claims and legal actions arising in the normal course of our businesses. Although we cannot predict the final results of these pending claims and legal actions, we believe, after consultation with counsel, that the final outcome of these matters will not have a material effect on our financial statements. |
Defined Benefit Pension and Other Postretirement Plans |
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Retirement Benefits [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Defined Benefit Pension and Other Postretirement Plans | Note 11 — Defined Benefit Pension and Other Postretirement Plans In the U.S., we sponsor a defined benefit pension plan for employees hired prior to January 1, 2009, of UGI, UGI Utilities, PNG, CPG and certain of UGI’s other domestic wholly owned subsidiaries (“U.S. Pension Plan”). We also provide postretirement health care benefits to certain retirees and postretirement life insurance benefits to nearly all U.S. active and retired employees. In addition, employees of UGI France SAS and its subsidiaries are covered by certain defined benefit pension and postretirement plans. Net periodic pension expense and other postretirement benefit costs include the following components:
The U.S. Pension Plan’s assets are held in trust and consist principally of publicly traded, diversified equity and fixed income mutual funds and, to a much lesser extent, UGI Common Stock. It is our general policy to fund amounts for U.S. Pension Plan benefits equal to at least the minimum required contribution set forth in applicable employee benefit laws. During the three months ended December 31, 2017 and 2016, the Company made cash contributions to the U.S. Pension Plan of $3.4 and $2.8, respectively. The Company expects to make additional discretionary cash contributions of approximately $10.1 to the U.S. Pension Plan during the remainder of Fiscal 2018. UGI Utilities has established a Voluntary Employees’ Beneficiary Association (“VEBA”) trust to pay retiree health care and life insurance benefits by depositing into the VEBA the annual amount of postretirement benefits costs, if any. The difference between such amount and amounts included in UGI Gas’ and Electric Utility’s rates, if any, is deferred for future recovery from, or refund to, ratepayers. There were no required contributions to the VEBA during the three months ended December 31, 2017 and 2016. We also sponsor unfunded and non-qualified supplemental executive defined benefit retirement plans. Net periodic costs associated with these plans for the three months ended December 31, 2017 and 2016, were not material. |
Fair Value Measurements |
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Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements | Note 12 — Fair Value Measurements Recurring Fair Value Measurements The following table presents on a gross basis our financial assets and liabilities, including both current and noncurrent portions, that are measured at fair value on a recurring basis within the fair value hierarchy, as of December 31, 2017, September 30, 2017 and December 31, 2016:
The fair values of our Level 1 exchange-traded commodity futures and option contracts and non-exchange-traded commodity futures and forward contracts are based upon actively quoted market prices for identical assets and liabilities. The remainder of our derivative instruments are designated as Level 2. The fair values of certain non-exchange-traded commodity derivatives designated as Level 2 are based upon indicative price quotations available through brokers, industry price publications or recent market transactions and related market indicators. For commodity option contracts designated as Level 2 that are not traded on an exchange, we use a Black Scholes option pricing model that considers time value and volatility of the underlying commodity. The fair values of our Level 2 interest rate contracts, foreign currency contracts and cross-currency contracts are based upon third-party quotes or indicative values based on recent market transactions. The fair values of investments held in grantor trusts are derived from quoted market prices as substantially all of the investments in these trusts have active markets. There were no transfers between Level 1 and Level 2 during the periods presented. Other Financial Instruments The carrying amounts of other financial instruments included in current assets and current liabilities (except for current maturities of long-term debt) approximate their fair values because of their short-term nature. We estimate the fair value of long-term debt by using current market rates and by discounting future cash flows using rates available for similar type debt (Level 2). The carrying amount and estimated fair value of our long-term debt (including current maturities but excluding unamortized debt issuance costs) at December 31, 2017, September 30, 2017 and December 31, 2016 were as follows:
Financial instruments other than derivative instruments, such as short-term investments and trade accounts receivable, could expose us to concentrations of credit risk. We limit credit risk from short-term investments by investing only in investment-grade commercial paper, money market mutual funds, securities guaranteed by the U.S. Government or its agencies and FDIC insured bank deposits. The credit risk arising from concentrations of trade accounts receivable is limited because we have a large customer base that extends across many different U.S. markets and a number of foreign countries. For information regarding concentrations of credit risk associated with our derivative instruments, see Note 13. Our investment in a private equity partnership is measured at fair value on a non-recurring basis. Generally this measurement uses Level 3 fair value inputs because the investment does not have a readily available market value. |
Derivative Instruments and Hedging Activities |
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Derivative Instruments and Hedging Activities Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities | Note 13 — Derivative Instruments and Hedging Activities We are exposed to certain market risks related to our ongoing business operations. Management uses derivative financial and commodity instruments, among other things, to manage these risks. The primary risks managed by derivative instruments are (1) commodity price risk; (2) interest rate risk; and (3) foreign currency exchange rate risk. Although we use derivative financial and commodity instruments to reduce market risk associated with forecasted transactions, we do not use derivative financial and commodity instruments for speculative or trading purposes. The use of derivative instruments is controlled by our risk management and credit policies, which govern, among other things, the derivative instruments we can use, counterparty credit limits and contract authorization limits. Although our commodity derivative instruments extend over a number of years, a significant portion of our commodity derivative instruments economically hedge commodity price risk during the next twelve months. Commodity Price Risk Regulated Utility Operations Natural Gas Gas Utility’s tariffs contain clauses that permit recovery of all of the prudently incurred costs of natural gas it sells to retail core-market customers, including the cost of financial instruments used to hedge PGC. As permitted and agreed to by the PUC pursuant to Gas Utility’s annual PGC filings, Gas Utility currently uses New York Mercantile Exchange (“NYMEX”) natural gas futures and option contracts to reduce commodity price volatility associated with a portion of the natural gas it purchases for its retail core-market customers. Gains and losses on Gas Utility’s natural gas futures contracts and natural gas option contracts are recorded in regulatory assets or liabilities on the condensed consolidated balance sheets because it is probable such gains or losses will be recoverable from, or refundable to, customers through the PGC recovery mechanism (see Note 7). Electricity Electric Utility’s DS tariffs permit the recovery of all prudently incurred costs of electricity it sells to DS customers, including the cost of financial instruments used to hedge electricity costs. Electric Utility enters into forward electricity purchase contracts to meet a substantial portion of its electricity supply needs. At December 31, 2017, September 30, 2017 and December 31, 2016, all Electric Utility forward electricity purchase contracts were subject to the NPNS exception. In order to reduce volatility associated with a substantial portion of its electricity transmission congestion costs, Electric Utility obtains FTRs through an annual allocation process. Gains and losses on Electric Utility FTRs are recorded in regulatory assets or liabilities on the condensed consolidated balance sheets because it is probable such gains or losses will be recoverable from, or refundable to, customers through the DS mechanism (see Note 7). Non-utility Operations LPG In order to manage market price risk associated with the Partnerships’ fixed-price programs, the Partnership uses over-the-counter derivative commodity instruments, principally price swap contracts. In addition, AmeriGas Partners, certain other domestic businesses and our UGI International operations also use over-the-counter price swap and option contracts to reduce commodity price volatility associated with a portion of their forecasted LPG purchases. The Partnership from time to time enters into price swap and put option agreements to reduce the effects of short-term commodity price volatility. Also, Midstream & Marketing uses NYMEX futures contracts to economically hedge the gross margin associated with the purchase and anticipated later near-term sale of propane. Natural Gas In order to manage market price risk relating to fixed-price sales contracts for natural gas, Midstream & Marketing enters into NYMEX and over-the-counter natural gas futures and forward contracts and Intercontinental Exchange (“ICE”) natural gas basis swap contracts. In addition, Midstream & Marketing uses NYMEX futures contracts to economically hedge the gross margin associated with the purchase and anticipated later near-term sale of natural gas. UGI International also uses natural gas futures and forward contracts to economically hedge market price risk associated with fixed-price sales contracts with its customers. Electricity In order to manage market price risk relating to fixed-price sales contracts for electricity, Midstream & Marketing enters into electricity futures and forward contracts. Midstream & Marketing also uses NYMEX and over-the-counter electricity futures contracts to economically hedge the price of a portion of its anticipated future sales of electricity from its electric generation facilities. From time to time, Midstream & Marketing purchases FTRs to economically hedge electricity transmission congestion costs associated with its fixed-price electricity sales contracts and from time to time also enters into New York Independent System Operator (“NYISO”) capacity swap contracts to economically hedge the locational basis differences for customers it serves on the NYISO electricity grid. UGI International also uses electricity futures and forward contracts to economically hedge market price risk associated with fixed-price sales and purchase contracts for electricity. Interest Rate Risk UGI France SAS’ and Flaga’s long-term debt agreements have interest rates that are generally indexed to short-term market interest rates. UGI France SAS and Flaga have each entered into pay-fixed, receive-variable interest rate swap agreements to hedge the underlying euribor rates and LIBOR rates of interest on their variable-rate term loans. Our domestic businesses’ long-term debt is typically issued at fixed rates of interest. As these long-term debt issues mature, we typically refinance such debt with new debt having interest rates reflecting then-current market conditions. In order to reduce market rate risk on the underlying benchmark rate of interest associated with near- to medium-term forecasted issuances of fixed-rate debt, from time to time we enter into interest rate protection agreements (“IRPAs”). We account for interest rate swaps and IRPAs as cash flow hedges. At December 31, 2017, the amount of net losses associated with interest rate hedges (excluding pay-fixed, receive-variable interest rate swaps) expected to be reclassified into earnings during the next twelve months is $3.5. Foreign Currency Exchange Rate Risk Forward Foreign Currency Exchange Contracts In order to reduce exposure to foreign exchange rate volatility related to our foreign LPG operations, through September 30, 2016, we entered into forward foreign currency exchange contracts to hedge a portion of anticipated U.S. dollar-denominated LPG product purchases primarily during the heating-season months of October through March. We account for these foreign currency exchange contracts associated with anticipated purchases of U.S. dollar-denominated LPG as cash flow hedges. At December 31, 2017, the amount of net losses associated with currency rate risk expected to be reclassified into earnings during the next twelve months based upon current fair values is $3.2. Beginning October 1, 2016, in order to reduce the volatility in net income associated with our foreign operations, principally as a result of changes in the U.S. dollar exchange rate between the euro and British pound sterling, we have entered into forward foreign currency exchange contracts. The fair value of these forward foreign currency contracts are recorded as assets or liabilities on the condensed consolidated balance sheets. Changes in the fair value of these foreign currency exchange contracts are recorded in “Losses on foreign currency contracts, net” on the Condensed Consolidated Statements of Income. From time to time we also enter into forward foreign currency exchange contracts to reduce the volatility of the U.S. dollar value of a portion of our UGI International euro-denominated net investments. We account for these foreign currency exchange contracts as net investment hedges. At December 31, 2017 and 2016, there were no unsettled net investment hedges outstanding. Cross-currency Swaps From time to time, Flaga enters into cross-currency swaps to hedge its exposure to the variability in expected future cash flows associated with the foreign currency and interest rate risk of U.S. dollar-denominated debt. These cross-currency hedges include initial and final exchanges of principal from a fixed euro denomination to a fixed U.S. dollar-denominated amount, to be exchanged at a specified rate, which was determined by the market spot rate on the date of issuance. These cross-currency swaps also include interest rate swaps of a floating U.S. dollar-denominated interest rate to a fixed euro-denominated interest rate. We designate these cross-currency swaps as cash flow hedges. At December 31, 2017, the amount of net losses associated with such cross-currency swaps expected to be reclassified into earnings during the next twelve months is not material. Quantitative Disclosures Related to Derivative Instruments The following table summarizes by derivative type the gross notional amounts related to open derivative contracts as of December 31, 2017, September 30, 2017 and December 31, 2016, and the final settlement date of the Company's open derivative transactions as of December 31, 2017, excluding those derivatives that qualified for the NPNS exception:
Derivative Instrument Credit Risk We are exposed to risk of loss in the event of nonperformance by our derivative instrument counterparties. Our derivative instrument counterparties principally comprise large energy companies and major U.S. and international financial institutions. We maintain credit policies with regard to our counterparties that we believe reduce overall credit risk. These policies include evaluating and monitoring our counterparties’ financial condition, including their credit ratings, and entering into agreements with counterparties that govern credit limits or entering into netting agreements that allow for offsetting counterparty receivable and payable balances for certain financial transactions, as deemed appropriate. Certain of these agreements call for the posting of collateral by the counterparty or by the Company in the forms of letters of credit, parental guarantees or cash. Additionally, our commodity exchange-traded futures contracts generally require cash deposits in margin accounts. At December 31, 2017, September 30, 2017 and December 31, 2016, restricted cash in brokerage accounts totaled $19.8, $10.3 and $7.9, respectively. Although we have concentrations of credit risk associated with derivative instruments, the maximum amount of loss we would incur if these counterparties failed to perform according to the terms of their contracts, based upon the gross fair values of the derivative instruments, was not material at December 31, 2017. Certain of the Partnership’s derivative contracts have credit-risk-related contingent features that may require the posting of additional collateral in the event of a downgrade of the Partnership’s debt rating. At December 31, 2017, if the credit-risk-related contingent features were triggered, the amount of collateral required to be posted would not be material. Offsetting Derivative Assets and Liabilities Derivative assets and liabilities are presented net by counterparty on the condensed consolidated balance sheets if the right of offset exists. We offset amounts recognized for the right to reclaim cash collateral or the obligation to return cash collateral against amounts recognized for derivative instruments executed with the same counterparty. Our derivative instruments include both those that are executed on an exchange through brokers and centrally cleared and over-the-counter transactions. Exchange contracts utilize a financial intermediary, exchange or clearinghouse to enter, execute or clear the transactions. Over-the-counter contracts are bilateral contracts that are transacted directly with a third party. Certain over-the-counter and exchange contracts contain contractual rights of offset through master netting arrangements, derivative clearing agreements and contract default provisions. In addition, the contracts are subject to conditional rights of offset through counterparty nonperformance, insolvency or other conditions. In general, most of our over-the-counter transactions and all exchange contracts are subject to collateral requirements. Types of collateral generally include cash or letters of credit. Cash collateral paid by us to our over-the-counter derivative counterparties, if any, is reflected in the table below to offset derivative liabilities. Cash collateral received by us from our over-the-counter derivative counterparties, if any, is reflected in the table below to offset derivative assets. Certain other accounts receivable and accounts payable balances recognized on the condensed consolidated balance sheets with our derivative counterparties are not included in the table below but could reduce our net exposure to such counterparties because such balances are subject to master netting or similar arrangements. Fair Value of Derivative Instruments The following table presents the Company’s derivative assets and liabilities by type, as well as the effects of offsetting, as of December 31, 2017, September 30, 2017 and December 31, 2016:
Effect of Derivative Instruments The following tables provide information on the effects of derivative instruments on the condensed consolidated statements of income and changes in AOCI for the three months ended December 31, 2017 and 2016:
For the three months ended December 31, 2017 and 2016, the amounts of derivative gains or losses representing ineffectiveness and the amounts of gains or losses recognized in income as a result of excluding derivatives from ineffectiveness testing were not material. We are also a party to a number of other contracts that have elements of a derivative instrument. These contracts include, among others, binding purchase orders, contracts that provide for the purchase and delivery, or sale, of energy products, and service contracts that require the counterparty to provide commodity storage, transportation or capacity service to meet our normal sales commitments. Although certain of these contracts have the requisite elements of a derivative instrument, these contracts qualify for NPNS exception accounting because they provide for the delivery of products or services in quantities that are expected to be used in the normal course of operating our business and the price in the contract is based on an underlying that is directly associated with the price of the product or service being purchased or sold. |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Accumulated Other Comprehensive Income | Note 14 — Accumulated Other Comprehensive Income The tables below present changes in AOCI during the three months ended December 31, 2017 and 2016:
For additional information on amounts reclassified from AOCI relating to derivative instruments, see Note 13. |
Segment Information |
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Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Note 15 — Segment Information Our operations comprise four reportable segments generally based upon products or services sold, geographic location and regulatory environment: (1) AmeriGas Propane; (2) UGI International; (3) Midstream & Marketing; and (4) UGI Utilities. Corporate & Other principally comprise (1) net expenses of UGI’s captive general liability insurance company and UGI’s corporate headquarters facility, and UGI’s unallocated corporate and general expenses and interest income. In addition, Corporate & Other includes net gains and losses on commodity and certain foreign currency derivative instruments not associated with current-period transactions (including such amounts attributable to noncontrolling interests) because such items are excluded from profit measures evaluated by our chief operating decision maker (“CODM”) in assessing our reportable segments’ performance or allocating resources. Corporate & Other assets principally comprise cash and cash equivalents of UGI and its captive insurance company, and UGI corporate headquarters’ assets. 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 2017 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. Our CODM evaluates the performance of our other reportable segments principally based upon their income before income taxes excluding gains and losses on commodity and certain foreign currency derivative instruments not associated with current-period transactions, as previously mentioned.
(a)The following table provides a reconciliation of Partnership Adjusted EBITDA to AmeriGas Propane income before income taxes:
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Summary of Significant Accounting Policies (Policies) |
3 Months Ended |
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Dec. 31, 2017 | |
Accounting Policies [Abstract] | |
Earnings Per Common Share | Earnings Per Common Share. Basic earnings per share attributable to UGI Corporation stockholders reflect the weighted-average number of common shares outstanding. Diluted earnings per share attributable to UGI Corporation include the effects of dilutive stock options and common stock awards. |
Derivative Instruments | Derivative Instruments. Derivative instruments are reported on the condensed consolidated balance sheets at their fair values, unless the derivative instruments qualify for the normal purchase and normal sale (“NPNS”) exception. The accounting for changes in fair value depends upon the purpose of the derivative instrument and whether it is designated and qualifies for hedge accounting. Certain of our derivative instruments are designated and qualify as cash flow hedges and from time to time we also enter into net investment hedges. For cash flow hedges, changes in the fair values of the derivative instruments are recorded in accumulated other comprehensive income (loss) (“AOCI”), to the extent effective at offsetting changes in the hedged item, until earnings are affected by the hedged item. We discontinue cash flow hedge accounting if occurrence of the forecasted transaction is determined to be no longer probable. Hedge accounting is also discontinued for derivatives that cease to be highly effective. Gains and losses on net investment hedges that relate to our foreign operations are included in AOCI until such foreign net investment is sold or liquidated. Unrealized gains and losses on substantially all of the commodity derivative instruments used by UGI Utilities (for which NPNS has not been elected) are included in regulatory assets or liabilities because it is probable such gains or losses will be recoverable from, or refundable to, customers. Beginning October 1, 2016, in order to reduce the volatility in net income associated with our foreign operations, principally as a result of changes in the U.S. dollar exchange rate between the euro and British pound sterling, we have entered into forward foreign currency exchange contracts. Because these contracts do not qualify for hedge accounting treatment, realized and unrealized gains and losses on these contracts are recorded in “(Losses) gains on foreign currency contracts, net” on the Condensed Consolidated Statements of Income. Cash flows from derivative instruments, other than net investment hedges and certain cross-currency swaps, if any, are included in cash flows from operating activities on the Condensed Consolidated Statements of Cash Flows. Cash flows from net investment hedges, if any, are included in cash flows from investing activities on the Condensed Consolidated Statements of Cash Flows. Cash flows from the interest portion of our cross-currency hedges, if any, are included in cash flow from operating activities while cash flows from the currency portion of such hedges, if any, are included in cash flow from financing activities. |
Income Taxes | Income Taxes. UGI’s consolidated effective income tax rate, defined as total income taxes as a percentage of income (loss) before income taxes, includes amounts associated with noncontrolling interests in the Partnership, which principally comprises AmeriGas Partners and AmeriGas OLP. AmeriGas Partners and AmeriGas OLP are not directly subject to federal income taxes. As a result, UGI’s consolidated effective income tax rate is affected by the amount of income (loss) before income taxes attributable to noncontrolling interests in the Partnership not subject to income taxes. See Note 5 for discussions regarding the December 22, 2017, enactment of the Tax Cuts and Jobs Act in the U.S. and changes in French tax laws. |
Use of Estimates | Use of Estimates. The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues, expenses and costs. These estimates are based on management’s knowledge of current events, historical experience and various other assumptions that are believed to be reasonable under the circumstances. Accordingly, actual results may be different from these estimates and assumptions. |
Reclassifications | Reclassifications. Certain prior period amounts have been reclassified to conform to the current-period presentation. |
Accounting Standards Not Yet Adopted | Accounting Standards Not Yet Adopted Derivatives and Hedging. In August 2017, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update ("ASU") No. 2017-12, “Targeted Improvements to Accounting for Hedging Activities.” This ASU amends and simplifies existing guidance to allow companies to more accurately present the economic effects of risk management activities in the financial statements. The amendments in this ASU are effective for interim and annual periods beginning after December 15, 2018 (Fiscal 2020). Early adoption is permitted. For cash flow and net investment hedges as of the adoption date, the guidance requires a modified retrospective approach. The amended presentation and disclosure guidance is required only prospectively. The Company is in the process of assessing the impact on its financial statements from the adoption of the new guidance and determining the period in which the new guidance will be adopted. Pension and Other Postretirement Benefit Costs. In March 2017, the FASB issued ASU No. 2017-07, “Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost.” This ASU requires entities to disaggregate the service cost component from the other components of net periodic benefit costs and present it with compensation costs for related employees in the income statement. The other components are required to be presented elsewhere in the income statement and outside of operating income. The amendments in this ASU permit only the service cost component to be eligible for capitalization when applicable. The amendments in this ASU are effective for interim and annual periods beginning after December 15, 2017 (Fiscal 2019). The amendments in the ASU should generally be adopted on a retrospective basis. The Company is in the process of assessing the impact on its financial statements from the adoption of the new guidance. Restricted Cash. In November 2016, the FASB issued ASU No. 2016-18, “Statement of Cash Flows: Restricted Cash.” This ASU provides guidance on the classification of restricted cash in the statement of cash flows. The amendments in this ASU are effective for interim and annual periods beginning after December 15, 2017 (Fiscal 2019). Early adoption is permitted. The amendments in the ASU are required to be adopted on a retrospective basis. The Company is in the process of assessing the impact on its financial statements from the adoption of the new guidance and determining the period in which the new guidance will be adopted. Leases. In February 2016, the FASB issued ASU No. 2016-02, "Leases." This ASU amends existing guidance to require entities that lease assets to recognize the assets and liabilities for the rights and obligations created by those leases on the balance sheet. The new guidance also requires additional disclosures about the amount, timing and uncertainty of cash flows from leases. The amendments in this ASU are effective for annual reporting periods beginning after December 15, 2018 (Fiscal 2020). Early adoption is permitted. Lessees must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements. The Company is in the process of assessing the impact on its financial statements from the adoption of the new guidance and determining the period in which the new guidance will be adopted but anticipates an increase in the recognition of right-of-use assets and lease liabilities. Revenue Recognition. In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers.” (“ASU 2014-09”) The guidance provided under this ASU, as amended, supersedes the revenue recognition requirements in Accounting Standards Codification (“ASC”) No. 605, “Revenue Recognition,” and most industry-specific guidance included in the ASC. ASU 2014-09 requires that an entity recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The new guidance is effective for the Company for interim and annual periods beginning after December 15, 2017 (Fiscal 2019) and allows for either full retrospective adoption or modified retrospective adoption. The Company is in the process of analyzing the impact of the new guidance using an integrated approach which includes evaluating differences in the amount and timing of revenue recognition from applying the requirements of the new guidance, reviewing its accounting policies and practices, and assessing the need for changes to its processes, accounting systems and design of internal controls. The Company has completed the assessment of a significant number of its contracts with customers under the new guidance to determine the effect of the adoption of the new guidance. Although the Company has not completed its assessment of the impact of the new guidance, the Company does not expect its adoption will have a material impact on its consolidated financial statements. The Company continues to monitor developments associated with certain utility industry specific guidance for possible impacts on the recognition of revenue by UGI Utilities. The Company currently anticipates that it will adopt the new standard using the modified retrospective transition method effective October 1, 2018. The ultimate decision with respect to the transition method that it will use will depend upon the completion of the Company’s analysis including confirming its preliminary conclusion that the adoption of the new guidance will not have a material impact on its consolidated financial statements. |
Summary of Significant Accounting Policies (Tables) |
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Shares Used in Computing Basic and Diluted Earnings Per Share | Shares used in computing basic and diluted earnings per share are as follows:
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Inventories (Tables) |
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Inventory Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Inventories | Inventories comprise the following:
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Goodwill and Intangible Assets (Tables) |
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Goodwill and Intangible Assets Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Company's Goodwill and Intangible Assets | Goodwill and intangible assets comprise the following:
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Utility Regulatory Assets and Liabilities and Regulatory Matters (Tables) |
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Regulated Operations [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Regulatory Assets | The following regulatory assets and liabilities associated with UGI Utilities are included in our accompanying condensed consolidated balance sheets:
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Schedule of Regulatory Liabilities | The following regulatory assets and liabilities associated with UGI Utilities are included in our accompanying condensed consolidated balance sheets:
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Energy Services Accounts Receivable Securitization Facility (Tables) |
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Transfers and Servicing [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Transfer of Trade Receivables | Information regarding the trade receivables transferred to ESFC and the amounts sold to the bank for the three months ended December 31, 2017 and 2016, as well as the balance of ESFC trade receivables at December 31, 2017, September 30, 2017 and December 31, 2016, is as follows:
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Defined Benefit Pension and Other Postretirement Plans (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Benefits [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Components of Net Periodic Pension Expense and Other Postretirement Benefit Costs | Net periodic pension expense and other postretirement benefit costs include the following components:
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Fair Value Measurement (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Financial Assets and Financial Liabilities that are Measured at Fair Value on a Recurring Basis | The following table presents on a gross basis our financial assets and liabilities, including both current and noncurrent portions, that are measured at fair value on a recurring basis within the fair value hierarchy, as of December 31, 2017, September 30, 2017 and December 31, 2016:
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Schedule of Carrying Amount and Estimated Fair Value of Long-term Debt | The carrying amount and estimated fair value of our long-term debt (including current maturities but excluding unamortized debt issuance costs) at December 31, 2017, September 30, 2017 and December 31, 2016 were as follows:
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Derivative Instruments and Hedging Activities (Tables) |
3 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Notional Amounts Related to Open Derivative Contracts | The following table summarizes by derivative type the gross notional amounts related to open derivative contracts as of December 31, 2017, September 30, 2017 and December 31, 2016, and the final settlement date of the Company's open derivative transactions as of December 31, 2017, excluding those derivatives that qualified for the NPNS exception:
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Schedule of Derivative Assets, Liabilities and the Effects of Offsetting | The following table presents the Company’s derivative assets and liabilities by type, as well as the effects of offsetting, as of December 31, 2017, September 30, 2017 and December 31, 2016:
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Effects of Derivative Instruments on Condensed Consolidated Statements of Income and Changes in AOCI and Noncontrolling Interest | The following tables provide information on the effects of derivative instruments on the condensed consolidated statements of income and changes in AOCI for the three months ended December 31, 2017 and 2016:
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Accumulated Other Comprehensive Income (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income | The tables below present changes in AOCI during the three months ended December 31, 2017 and 2016:
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Segment Information (Tables) |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information |
(a)The following table provides a reconciliation of Partnership Adjusted EBITDA to AmeriGas Propane income before income taxes:
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Reconciliation of Adjusted EBITDA to (Loss) Income Before Income Taxes | The following table provides a reconciliation of Partnership Adjusted EBITDA to AmeriGas Propane income before income taxes:
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Nature of Operations (Details) $ in Millions |
3 Months Ended | |
---|---|---|
Dec. 31, 2017
USD ($)
county
|
Dec. 31, 2016
USD ($)
|
|
Investment [Line Items] | ||
General Partner incentive distribution | $ | $ 11.3 | $ 10.4 |
Number of counties of operation | county | 1 | |
Amerigas Propane | AmeriGas Partners | ||
Investment [Line Items] | ||
General Partner held a general partner interest in AmeriGas Partners | 1.00% | |
Percentage of limited partnership interest in AmeriGas Partners | 25.30% | |
General public as limited partner interests in AmeriGas Partners | 73.70% | |
Amerigas Propane | AmeriGas OLP | ||
Investment [Line Items] | ||
Effective ownership interest in AmeriGas OLP | 27.00% |
Summary of Significant Accounting Policies - Shares Used in Computing Basic and Diluted Earnings Per Share (Details) - shares |
3 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Denominator (thousands of shares): | ||
Weighted-average common shares outstanding - basic (in shares) | 173,670,000 | 173,512,000 |
Incremental shares issuable for stock options and awards (in shares) | 3,278,000 | 3,472,000 |
Weighted-average common shares outstanding - diluted (in shares) | 176,948,000 | 176,984,000 |
Antidilutive shares excluded from calculation of earnings per share | 146,000 | 0 |
Inventories - Components of Inventories (Details) - USD ($) $ in Millions |
Dec. 31, 2017 |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|---|
Inventory | |||
Total inventories | $ 307.3 | $ 278.6 | $ 228.2 |
Non-utility LPG and natural gas | |||
Inventory | |||
Total inventories | 216.4 | 188.4 | 150.9 |
Gas Utility natural gas | |||
Inventory | |||
Total inventories | 34.6 | 39.5 | 25.8 |
Materials, supplies and other | |||
Inventory | |||
Total inventories | $ 56.3 | $ 50.7 | $ 51.5 |
Inventories - Narrative (Details) - UGI Utilities $ in Millions |
3 Months Ended | ||
---|---|---|---|
Dec. 31, 2017
USD ($)
storage_agreement
Bcf
|
Sep. 30, 2017
USD ($)
Bcf
|
Dec. 31, 2016
USD ($)
Bcf
|
|
Inventory | |||
Number of storage agreements | storage_agreement | 5 | ||
Volume of gas storage inventories released under SCAAs with non-affiliates (in bcf) | Bcf | 1.8 | 2.3 | 1.9 |
Carrying value of gas storage inventories released under SCAAs with non-affiliates | $ | $ 5.1 | $ 6.7 | $ 4.8 |
Maximum | |||
Inventory | |||
SCAA contract term (in years) | 3 years |
Goodwill and Intangible Assets - Components of Company's Goodwill and Intangible Assets (Details) - USD ($) $ in Millions |
Dec. 31, 2017 |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|---|
Goodwill and Intangible Assets Disclosure [Abstract] | |||
Goodwill (not subject to amortization) | $ 3,185.5 | $ 3,107.2 | $ 2,935.8 |
Intangible assets: | |||
Customer relationships, noncompete agreements and other | 862.0 | 817.8 | 759.4 |
Accumulated amortization | (355.0) | (340.2) | (329.0) |
Intangible assets, net (definite-lived) | 507.0 | 477.6 | 430.4 |
Trademarks and tradenames (indefinite-lived) | 134.9 | 134.1 | 128.5 |
Total intangible assets, net | $ 641.9 | $ 611.7 | $ 558.9 |
Goodwill and Intangible Assets - Narrative (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Amortization expense of intangible assets | $ 14.8 | $ 12.5 |
Remainder of Fiscal 2018 | 42.8 | |
Fiscal 2019 | 55.1 | |
Fiscal 2020 | 53.7 | |
Fiscal 2021 | 51.9 | |
Fiscal 2022 | $ 50.2 |
Energy Services Accounts Receivable Securitization Facility - Narrative (Details) - USD ($) |
6 Months Ended | |
---|---|---|
Oct. 31, 2017 |
Apr. 30, 2017 |
|
Maximum | ||
Accounts, Notes, Loans and Financing Receivable | ||
Receivables facility | $ 75,000,000 | $ 150,000,000 |
Energy Services Accounts Receivable Securitization Facility - Trade Receivables Transferred and Sold (Details) - ESFC - USD ($) $ in Millions |
3 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
Sep. 30, 2017 |
|
Accounts, Notes, Loans and Financing Receivable | |||
Trade receivables transferred to ESFC during the period | $ 270.6 | $ 246.4 | |
ESFC trade receivables sold to the bank during the period | 48.0 | 66.0 | |
ESFC trade receivables - end of period | 101.0 | 81.4 | $ 44.8 |
Outstanding balance of trade receivables sold | $ 45.0 | $ 35.0 | $ 39.0 |
Defined Benefit Pension and Other Postretirement Plans - Components of Net Periodic Pension Expense and Other Postretirement Benefit Costs (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Pension Benefits | ||
Defined Benefit Plan Disclosure | ||
Service cost | $ 2.8 | $ 3.0 |
Interest cost | 6.5 | 6.2 |
Expected return on assets | (8.6) | (8.3) |
Amortization of: | ||
Prior service cost (benefit) | 0.1 | 0.1 |
Actuarial loss | 3.3 | 4.1 |
Net benefit cost | 4.1 | 5.1 |
Change in associated regulatory liabilities | 0.0 | 0.0 |
Net benefit cost after change in regulatory liabilities | 4.1 | 5.1 |
Other Postretirement Benefits | ||
Defined Benefit Plan Disclosure | ||
Service cost | 0.2 | 0.2 |
Interest cost | 0.2 | 0.2 |
Expected return on assets | (0.2) | (0.2) |
Amortization of: | ||
Prior service cost (benefit) | (0.1) | (0.1) |
Actuarial loss | 0.1 | 0.1 |
Net benefit cost | 0.2 | 0.2 |
Change in associated regulatory liabilities | (0.1) | (0.1) |
Net benefit cost after change in regulatory liabilities | $ 0.1 | $ 0.1 |
Defined Benefit Pension and Other Postretirement Plans - Narrative (Details) - USD ($) |
3 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Defined Benefit Plans and Other Postretirement Benefit Plans | ||
Contribution made to Pension and Post-retirement Plans | $ 3,400,000 | $ 2,800,000 |
Expected contribution to pension plan during remainder of fiscal year | 10,100,000 | |
Other Postretirement Benefits | ||
Defined Benefit Plans and Other Postretirement Benefit Plans | ||
Contribution made to Pension and Post-retirement Plans | $ 0 | $ 0 |
Fair Value Measurements - Long-term Debt (Details) - USD ($) $ in Millions |
Dec. 31, 2017 |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|---|
Carrying amount | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term debt | $ 4,319.5 | $ 4,211.9 | $ 4,083.8 |
Estimated fair value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Long-term debt | $ 4,430.0 | $ 4,346.8 | $ 4,171.0 |
Derivative Instruments and Hedging Activities - Narrative (Details) - USD ($) |
Dec. 31, 2017 |
Sep. 30, 2017 |
Dec. 31, 2016 |
---|---|---|---|
Derivative [Line Items] | |||
Amount of net losses associated with interest rate hedges to be reclassified with interest rate hedges during the next 12 months | $ (3,500,000) | ||
Amount of net gains associated with currency rate risk to be reclassified into earnings during the next 12 months | (3,200,000) | ||
Restricted cash in brokerage accounts | 19,800,000 | $ 10,300,000 | $ 7,900,000 |
Foreign currency contracts | |||
Derivative [Line Items] | |||
Notional amount | 485,700,000 | $ 424,800,000 | 416,700,000 |
Net Investment Hedging | Foreign currency contracts | |||
Derivative [Line Items] | |||
Notional amount | $ 0 | $ 0 |
Segment Information - Narrative (Details) |
3 Months Ended |
---|---|
Dec. 31, 2017
segment
| |
Segment Reporting [Abstract] | |
Number of reportable segments | 4 |
Segment Information - Reconciliation of Partnership Adjusted EBITDA (Details) - USD ($) $ in Millions |
3 Months Ended | |
---|---|---|
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Segment Reporting Information | ||
Depreciation and amortization | $ (110.3) | $ (98.1) |
Interest expense | (58.2) | (55.4) |
Loss on extinguishments of debt | 0.0 | (33.2) |
Income (loss) before income taxes | $ 329.8 | $ 378.7 |
Amerigas Propane | AmeriGas OLP | ||
Segment Reporting Information | ||
General Partnership interest (percentage) | 1.01% | 1.01% |
Operating Segments | Amerigas Propane | ||
Segment Reporting Information | ||
Partnership Adjusted EBITDA | $ 194.1 | $ 185.1 |
Depreciation and amortization | (47.4) | (44.6) |
Interest expense | (40.6) | (40.0) |
Loss on extinguishments of debt | 0.0 | (33.2) |
Noncontrolling interest | 1.2 | 1.4 |
Income (loss) before income taxes | $ 107.3 | $ 68.7 |
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