AGA GA Fina Financ ncial ial For orum um Joh ohn n Walsh alsh Preside Pr esident nt and and CE CEO UGI UGI Cor Corpo poration tion May May 19 19, 2 , 201 014 1 May 19, 2014
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 and quarterly reports on Form 10-Q 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, and achieve anticipated synergies. UGI undertakes no obligation to release revisions to its forward-looking statements to reflect events or circumstances occurring after today. 2 May 19, 2014
Introduction UGI Corporation John Walsh President and CEO Kirk Oliver CFO Dan Platt Treasurer Simon Bowman Manager, Investor Relations and Treasury UGI Utilities Robert Beard President and CEO 3 May 19, 2014 May 19, 2014
About UGI Corporation UGI Corporation (NYSE: UGI) is a distributor and marketer of energy products and services including natural gas, propane, butane, and electricity. Domestic Propane Midstream & UGI International UGI Utilities (NYSE: APU*) Marketing AmeriGas also operates in 4 May 19, 2014 May 19, 2014 *100% GP interest and 25% of outstanding LP units Hawaii and Alaska
Commitment to Investors 6-10% annual earnings growth 4% annual dividend growth Dividends Cash flow Base business earnings $250 MM - $125 MM- growth 3-4% $290 MM * $140 MM* Organic investment and M&A 1 $125 MM - Incremental earnings growth 3-6% $150 MM * *multi-year average forecast 1 after business unit CAPEX 5 May 19, 2014 May 19, 2014
Dividend Track Record Consecutive dividends: 130 years, consecutive increases: 27 years $1.20 100% $1.00 80% $0.80 60% $0.60 40% $0.40 20% $0.20 $0.00 0% 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014F Dividend (left axis) Payout Ratio (right axis) 2014F based on midpoint of earnings guidance issued 11/18/13 and assumed 4% dividend increase 6 May 19, 2014 May 19, 2014
Total Shareholder Return Through 3/31/14 1 Year Total Return 3 Year Total Return 5 Year Total Return 24.0% 16.0% 28.0% 24.0% 12.0% 20.0% 16.0% 16.0% 8.0% 12.0% 8.0% 8.0% 4.0% 4.0% 0.0% 0.0% 0.0% UGI S&P 500 S&P 500 S&P 400 UGI S&P 500 S&P 500 S&P 400 UGI S&P 500 S&P 500 S&P 400 Utilities Midcap Utilities Midcap Utilities Midcap 10 Year Total Return 15 Year Total Return 20 Year Total Return 16.0% 20.0% 16.0% 16.0% 12.0% 12.0% 12.0% 8.0% 8.0% 8.0% 4.0% 4.0% 4.0% 0.0% 0.0% 0.0% UGI S&P 500 S&P 500 S&P 400 UGI S&P 500 S&P 500 S&P 400 UGI S&P 500 S&P 500 S&P 400 Utilities Midcap Utilities Midcap Utilities Midcap 7 May 19, 2014 May 19, 2014
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UGI Utilities: Overview Pennsylvania’s 2 nd largest gas utility ~ 62,000 electric 46 of the 67 PA ~ 600,000 gas customers counties served customers ~ 13,000 miles of main 9 May 19, 2014 May 19, 2014
UGI Utilities: Growth Initiatives Attractive and growing service area Total Residential Customer Additions 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2,000 - 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Residential New Homes Residential Conversions Residential Upgrades >250,000 potential customers within close proximity to UGI’s mains 10 May 19, 2014 May 19, 2014
UGI Utilities: Services Committed to serving customers in Pennsylvania Infrastructure replacement • All cast iron main replaced by 2027 and all bare steel by 2043 Distribution System Improvement Charge (DSIC) • DSIC approved in 2012 provides a quarterly surcharge to recover cost of infrastructure updates 11 May 19, 2014 May 19, 2014
UGI Utilities: Services Committed to serving customers in Pennsylvania GET Gas program: Improving accessibility of natural gas • Innovative way to make natural gas available to more Pennsylvanians • Program utilizes a standard 10-year repayment period designed to reach unserved or underserved areas 12 May 19, 2014 May 19, 2014
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AmeriGas: Overview Largest player in a fragmented industry 15% market share* > 1 billion gallons sold > 47,000 ACE distribution points 8,500 employees > 2,500 Distribution locations > 100 brands Goal: 3-4% EBITDA growth, 5% distribution growth annually * Source: LP Gas magazine 14 May 19, 2014 May 19, 2014
Unit Margin Management A long track record of exceptional margin management through volatile propane cost environments $1.80 $1.60 $1.40 $1.20 $1.00 $0.80 $0.60 $0.40 $0.20 $0.00 2005 2006 2007 2008 2009 2010 2011 2012 2013 Avg. Mt. Belvieu Cost Propane Unit Margins 15 May 19, 2014 May 19, 2014
Why Invest in AmeriGas? Geographic Coverage End-use Diversity • • Efficient distribution achieved Significant commercial/industrial through greater customer density customer base • • Geographic diversity reduces Large presence in emerging weather risk applications such as autogas and • Provides advantage with lawn care acquisitions, multi-state customers The AmeriGas Advantage Significant Scale Benefits Counter-seasonal business • • Supply/Logistics team based in AmeriGas Cylinder Exchange (ACE) • Houston, TX AmeriGuard (price protection • Transportation assets (rail cars, program) • Fuel and hazmat surcharges help tractor trailers, trans-flow units) • Largest sales force in the industry mitigate weather volatility 16 May 19, 2014 May 19, 2014
AmeriGas: Growth Initiatives 3 Key Strategic Growth Initiatives Description Size Growth Contribution AmeriGas < 10% of Cylinder Counter-seasonal summer 4-6% Expected annual AmeriGas Exchange grilling tank exchange EBITDA growth EBITDA (ACE) Utilizes nationwide footprint < 5% of National to serve commercial AmeriGas 4-6% Expected annual customers in multiple EBITDA EBITDA growth Accounts locations Nationwide footprint provides for highly ~ 3% Expected annual Acquisitions synergistic, immediately Varies EBITDA growth accretive acquisition opportunities 17 May 19, 2014 May 19, 2014
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International: Overview • Eastern Europe • United Kingdom and Nordics • Over 140 MM • Other brand gallons in FY13 names: • Over 230 MM gallons in FY13 • France & Benelux • Over 300 MM gallons in FY13 19 May 19, 2014 May 19, 2014
Unit Margin Management Exceptional unit margin management through volatile periods Antargaz Margin History LPG Unit Margins Avg. Platt’s Cost (€ /T) 700 € 700 € 600 € 600 € ( € /T) 500 € 500 € 400 € 400 € 300 € 300 € 200 € 200 € 2005 2006 2007 2008 2009 2010 2011 2012 2013 Avg. Platt's Cost Propane Unit Margins AmeriGas Margin History $1.80 $1.80 Margins ($/gallon) Avg. Mt. Belvieu Cost Propane Unit $1.40 $1.40 $1.00 $1.00 $0.60 $0.60 $0.20 $0.20 2005 2006 2007 2008 2009 2010 2011 2012 2013 20 May 19, 2014 May 19, 2014 Avg. Mt. Belvieu Cost Propane Unit Margins
EBITDA Contribution Increased diversification through acquisitions and integration FY13 EBITDA: € 171 MM * Benelux FY08 EBITDA: € 104 MM Austria Hungary Denmark Poland Czech Republic Romania Switzerland France Slovakia UK Finland Sweden Norway * Updated 7/1/2014 21 May 19, 2014 May 19, 2014
International: Growth Initiatives Both acquisition and organic growth opportunities Organic Growth Acquisition Opportunities Opportunities • Natural gas marketing • Bolt-on acquisitions in (France) Eastern Europe and the UK • Heating oil to LPG conversions (Nordics) • Greenfield expansion in Western Europe • Residential customer growth (Poland) • Natural gas marketing • Strategic partnerships in Western Europe (UK) 22 May 19, 2014 May 19, 2014
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