 Second
Quarter 2013 Earnings Conference Call
May 1, 2013
Exhibit 99.2 |
 May
1, 2013 2
About This Presentation
This presentation contains certain forward-looking statements that management
believes to be reasonable as of today’s date only. Actual results may differ
significantly because of risks and uncertainties that are difficult to predict and
many of which are beyond management’s control. You should read UGI’s Annual
Report on Form 10-K for a more extensive list of factors that could affect results.
Among them are adverse weather conditions, cost volatility and availability of all
energy products, including propane, natural gas, electricity and fuel oil, increased
customer conservation measures, the impact of pending and future legal
proceedings, domestic and international political, regulatory and economic
conditions including currency exchange rate fluctuations (particularly the euro),
the timing of development of Marcellus Shale gas production, the timing and
success of our commercial initiatives and investments to grow our business, and
our ability to successfully integrate acquired businesses, including Heritage
Propane, and achieve anticipated synergies. UGI undertakes no obligation to
release revisions to its forward-looking statements to reflect events or
circumstances occurring after today.
|
 John
Walsh President & CEO, UGI
Kirk Oliver
Chief Financial Officer, UGI
Jerry Sheridan
President & CEO, AmeriGas |
 Second Quarter EPS
+28% over Q2
of Fiscal 12
An almost 30% increase in EPS over Q2 of FY12
May 1, 2013
4 |
 May 1, 2013
5
Weather vs Normal
-
1.5%
-21.7%
10.1%
1.2%
5.1%
-2.1%
1.9%
-
19.3%
-25%
-20%
-
15%
-10%
-
5%
0%
5%
10%
15%
FY2013
FY2012
AmeriGas
Antargaz
Flaga
Utility |
 AmeriGas
VOLUME
Colder weather
Full-period impact of Heritage
OPEX
Full-period impact of Heritage
Higher sales activity
Synergies
Transition expenses: $2.7 MM
lower than prior year
Increase in miscellaneous income
Total Margin
* Opex includes all operating expenses, net of miscellaneous income.
195.0
266.1
82.9
(0.3)
4.4
(11.9)
(3.8)
$100
$150
$200
$250
$300
Operating Income, $ MM
May 1, 2013
6
Total margin represents total revenues less total cost of sales.
|
 International Propane
VOLUME
Colder weather
Timing of deliveries in Q2 of FY12
MARGIN
Higher unit margins at Antargaz
Higher natural gas marketing
margin
OPEX
Antargaz operating expenses
Transition expense of $1 million in
prior period
Total Margin
* Opex includes all operating expenses, net of miscellaneous income.
62.1
74.1
(5.7)
18.1
(2.4)
1.4
0.6
$40
$50
$60
$70
$80
Income Before
Taxes
, $ MM
May 1, 2013
7
Total margin represents total revenues less total cost of sales.
|
 Gas
Utility MARGIN
Colder weather
Conversions from heating oil
OPEX
Higher pension and system
maintenance expenses
* Opex includes all operating expenses, net of miscellaneous income.
74.9
96.4
24.6
5.3
(8.7)
(0.5)
0.8
$60
$70
$80
$90
$100
$110
Income Before
Taxes
, $ MM
Total Margin
May 1, 2013
8
Total margin represents total revenues less total cost of sales.
|
 May 1, 2013
9
Midstream & Marketing
MARGIN
Colder weather
Gas price volatility in January
Lower power marketing margins
due to lower average unit prices
D&A
Increase due to Temple II
Total Margin
* Opex includes all operating expenses, net of miscellaneous income.
29.3
43.2
8.4
4.2
3.5
(1.4)
(1.3)
0.5
$10
$20
$30
$40
$50
Income Before Taxes, $ MM
Total margin represents total revenues less total cost of sales.
|
 May 1, 2013
10
Liquidity
Int'l
Corporate/
Total
AmeriGas
Propane
Utilities
Midstream
Other
Cash on hand
446.3
$
123.1
$
165.7
$
58.3
$
11.8
$
87.4
$
Revolving Credit Facilities
525.0
$
125.0
$
300.0
$
240.0
$
NA
Accounts receivable facility
NA
NA
NA
59.1
$
NA
Drawn on facilities
(115.9)
$
(14.8)
$
-
$
(47.0)
$
NA
Letters of credit
(54.1)
$
(24.9)
$
(2.0)
$
-
$
NA
Available facilities
355.0
$
85.3
$
298.0
$
252.1
$
-
$
Available liquidity
478.1
$
251.0
$
356.3
$
263.9
$
87.4
$
Excluding cash residing at operating subsidiaries, UGI had $78.4 million of cash at
3/31/13 compared with $63.3 million at 3/31/12. |
 Jerry Sheridan
CEO of AmeriGas |
 Q2
Adjusted EBITDA 29% over Q2
of Fiscal 12
* See appendix for Adjusted EBITDA reconciliation
29% over Q2
of Fiscal 12
* See appendix for Adjusted EBITDA reconciliation
246.0
317.6
$150
$200
$250
$300
$350
Adjusted EBITDA*, $ Millions
May 1, 2013
12 |
 May 1, 2013
13
Operational Update
Operations
•
Weather: Warmer than normal, much colder than LY
•
Volume up in line with expectations
•
Lower COGS, Mt. Belvieu prices down 39 cents, or 31%
Growth Initiatives
•
AmeriGas Cylinder Exchange (ACE):
•
National Accounts:
•
Acquisitions:
Volume growth of 6% y/y,
results muted by a colder March
Volume increased 14 MM gallons y/y, 22 MM
gallons ytd
No acquisitions closed during the quarter |
 May 1, 2013
14
Guidance & Heritage Update
•
FY13
Guidance
remains
$620MM
-
$645MM,
trending
toward
the midpoint
•
Final stages of Heritage integration: Planning to consolidate over
200 stores
•
Increased estimated transition expenses for the year by $5 MM
reflecting additional severance costs
•
On track to realize at least $60MM in total net synergies |
 May 1, 2013
15
Distribution Increase
$2.00
$2.20
$2.40
$2.60
$2.80
$3.00
$3.20
$3.40
2006
2007
2008
2009
2010
2011
2012
2013
AmeriGas: Distributions per unit
(excluding special distributions)
5.4% CAGR |
 John Walsh
President & CEO |
 May 1, 2013
17
Operational Update
Gas Utility
•
Infrastructure
Replacement
Program
approved
by
PUC;
Gas
Utility
infrastructure capex expected to be approximately 25% above FY12
levels
•
Demand
for
natural
gas
remains
at
unprecedented
levels:
Net
customer growth expected to exceed 2% in FY13
AmeriGas
•
.
Final phase of Heritage integration is now underway and will conclude
this summer
•
Superior distribution network covering the entire United States and very
strong leadership team in place |
 May 1, 2013
18
Operational Update
International
•
Focused
on
operational
efficiencies:
Broader
base
of
operations
in
Europe will help reduce costs and enhance efficiencies in areas such
as product sourcing
•
BP
Poland
acquisition:
Expected
to
close
in
Q4
of
FY13
•
20% drop in propane costs a positive for both UGI and our customers
Midstream & Marketing
•
Expanding LNG services with Temple II
•
Auburn II pipeline in field execution phase. Expected in-service date
remains early FY14
•
New Tenaska gathering system expected in early 2014 |
 May 1, 2013
19
Concluding Remarks
•
FY13 Guidance remains $2.40-$2.50, trending toward lower
half •
FY13
Will
mark
UGI’s
129
consecutive
year
of
dividends
and
26
consecutive year of dividend increases
th
th
$0.60
$0.80
$1.00
$1.20
2006
2007
2008
2009
2010
2011
2012
2013
UGI: Dividends per share
(excluding special distributions)
6.9% CAGR |
 Q&A |
 Appendix |
 May 1, 2013
22
AmeriGas Supplemental Information: Footnotes
The
enclosed
supplemental
information
contains
a
reconciliation
of
earnings
before
interest
expense,
income
taxes,
depreciation and amortization ("EBITDA") and Adjusted EBITDA to Net
Income. EBITDA and Adjusted EBITDA are not measures of performance or
financial condition under accounting principles generally accepted in the
United States ("GAAP"). Management believes EBITDA and Adjusted EBITDA are meaningful
non-GAAP financial measures used by investors to compare the Partnership's
operating performance with that of other companies within the propane
industry. The Partnership's definitions of EBITDA and Adjusted EBITDA may be different
from those used by other companies.
EBITDA and Adjusted EBITDA should not be considered as alternatives to net
income (loss) attributable to AmeriGas Partners, L.P. Management uses EBITDA
to compare year-over-year profitability of the business without regard to capital
structure as well as to compare the relative performance of the Partnership to that
of other master limited partnerships without regard to their financing
methods, capital structure, income taxes or historical cost basis. Management uses
Adjusted
EBITDA
to
exclude
from
AmeriGas
Partners’
EBITDA
gains
and
losses
that
competitors
do
not
necessarily
have
to provide additional insight into the comparison of year-over-year
profitability to that of other master limited partnerships. In view of the
omission of interest, income taxes, depreciation and amortization from EBITDA and Adjusted EBITDA,
management also assesses the profitability of the business by comparing net income
attributable to AmeriGas Partners, L.P. for the relevant years.
Management also uses EBITDA to assess the Partnership's profitability because its parent,
UGI Corporation, uses the Partnership's EBITDA to assess the profitability of the
Partnership, which is one of UGI Corporation’s industry segments.
UGI Corporation discloses the Partnership's EBITDA in its disclosures about its industry
segments as the profitability measure for its domestic propane segment.
|
 May 1, 2013
23
AmeriGas Propane EBITDA Reconciliation
(1) Adjusted EBITDA is a non-GAAP financial measure. Management
believes the presentation of this measure provides useful information to
investors to more effectively evaluate the year-over-year
results of operations of the Partnership. Management uses Adjusted EBITDA to exclude
from AmeriGas Partners' EBITDA gains and losses that competitors do not
necessarily have to provide additional insight into the comparison of
year-over-year profitability to that of other master limited
partnerships. This measure is not comparable to measures used by other entities and
should only be considered in conjunction with net income attributable
to AmeriGas Partners, L.P. for the relevant periods. 2013
2012
2013
2012
2013
2012
Net income attributable to AmeriGas Partners, L.P.
221,820
$
133,885
$
318,485
$
176,410
$
153,100
$
122,063
$
Income tax (benefit) expense
(52)
764
575
1,214
1,292
1,256
Interest expense
41,776
45,045
82,972
61,578
164,035
93,374
Depreciation
37,607
35,351
75,930
56,282
153,873
98,841
Amortization
11,022
9,441
22,050
12,698
44,250
18,978
EBITDA
312,173
$
224,486
$
500,012
$
308,182
$
516,550
$
334,512
$
Heritage Propane acquisition and transition expense
5,396
8,138
10,884
11,855
45,216
11,855
Loss (gain) on extinguishments of debt
-
13,379
-
13,379
(30)
32,695
Adjusted EBITDA (1)
317,569
$
246,003
$
510,896
$
333,416
$
561,736
$
379,062
$
March 31,
Twelve Months Ended
March 31,
Three Months Ended
Six Months Ended
March 31, |
 Investor Relations:
610-337-1000
Hugh Gallagher (x1029)
gallagherh@ugicorp.com
Simon Bowman (x3645)
bowmans@ugicorp.com |