UGI CORP / PA / MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL POSITION AND RESULTS OF OPERATIONS (Kind 10-Ok)

MD&A discusses our outcomes of operations for Fiscal 2021 and Fiscal 2020, and
our monetary situation. For dialogue of our outcomes of operations and money
flows for Fiscal 2020 in contrast with Fiscal 2019, check with "Merchandise 7. Administration's
Dialogue and Evaluation of Monetary Situation and Outcomes of Operations" in our
Fiscal 2020 Annual Report on Kind 10-Ok, filed with the SEC on November 20, 2020.
MD&A must be learn along with Gadgets 1 and a couple of, "Enterprise and
Properties," Merchandise 1A, "Threat Elements," and the Consolidated Monetary Statements
in Merchandise 8 under together with "Phase Info" included in Observe 23 to
Consolidated Monetary Statements.
As a result of most of our companies promote or distribute power merchandise utilized in massive
half for heating functions, our outcomes are considerably influenced by
temperatures in our service territories, significantly throughout the heating-season
months of October by March. Accordingly, our outcomes of operations, after
adjusting for the consequences of positive factors and losses on spinoff devices not
related to current-period transactions as additional mentioned under, are
considerably larger in our first and second fiscal quarters.

Government Overview
Current Developments
Acquisition of Mountaineer Fuel Firm
On September 1, 2021, UGI acquired Mountaineer, the most important pure gasoline
distribution firm in West Virginia for a purchase order value of $540 million,
which incorporates the belief of roughly $140 million principal quantities of
long-term debt. Mountaineer serves almost 214,000 clients throughout 50 of the
state's 55 counties. Mountaineer is topic to regulation by the WVPSC. The
Mountaineer Acquisition was funded with money proceeds from the 2021 UGI
Company Senior Credit score Facility and the issuance of Fairness Models and money on
hand. The Mountaineer enterprise is included within the UGI Utilities phase as of
the acquisition date. For added data on the Mountaineer Acquisition
and the related financings, see Notes 5, 6 and 13 to the consolidated
monetary statements.
COVID-19 Pandemic
In March 2020, the WHO declared a worldwide pandemic attributable to the outbreak
and continued unfold of COVID-19 that has had a major affect all through
the worldwide financial system. In reference to the mitigation and containment procedures
advisable by the WHO, the CDC, and as imposed by federal, state, and native
governmental authorities, together with shelter-in-place orders, quarantines and
comparable restrictions, we applied quite a lot of procedures to guard our
workers, third-party enterprise companions, and clients worldwide. Though our
outcomes proceed to be impacted by COVID-19, we proceed to supply important
services and products to our world clients in a secure and dependable method and
will proceed to take action in compliance with mandated restrictions introduced by
every of the markets we serve. We proceed to guage and react to the potential
results of a protracted disruption and the continued affect on our outcomes of
operations. These things might embrace, however should not restricted to: the monetary
situation of our clients; decreased availability and demand for our merchandise
and companies; realization of accounts receivable; impairment issues
associated to sure present belongings, long-lived belongings and goodwill; delays
associated to present and future initiatives; and the consequences of presidency stimulus
efforts together with tax laws (see "Curiosity Expense and Earnings Taxes" under
and Observe 7 to the consolidated monetary statements) in response to COVID-19.
We can not predict the period or complete magnitude of the pandemic and the entire
results on our enterprise, monetary place, outcomes of operations, liquidity or
money flows right now, however we stay centered on managing our monetary
situation and liquidity all through this world disaster.
Strategic Initiatives

Enterprise transformation initiatives

Enterprise companies. Beginning in fiscal 2020, we launched a metamorphosis challenge centered on our assist features, together with: finance, buying, human assets and data expertise. This initiative will standardize processes and

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actions throughout our world platform, whereas leveraging using finest
practices and efficiencies between our companies. Whereas this initiative is
being coordinated throughout a number of assist features, every space is at a unique
stage of transformation and can bear the required modifications over a two to
three yr interval. In reference to these actions, we count on to incur
roughly $40 million of non-recurring prices throughout that point leading to
greater than $15 million of ongoing annualized financial savings by the tip of Fiscal 2023.

AmeriGas Propane: At AmeriGas Propane, we started executing on enterprise
transformation initiatives throughout Fiscal 2019 centered on effectivity and
effectiveness within the following key areas: buyer digital expertise; buyer
relationship administration; working course of redesign and specialization;
distribution and routing optimization; gross sales and advertising effectiveness;
buying and common and administrative efficiencies; and provide and
logistics. These transformation actions are considerably full and are
anticipated to supply complete annual advantages of greater than $150 million by the tip
of Fiscal 2022. These advantages will enable us to proceed to enhance
profitability and money stream by operational efficiencies and expense
reductions and allow elevated funding into base enterprise buyer retention
and development initiatives, together with the discount of margins in choose segments of
our base enterprise. The entire value of executing on these initiatives, together with
roughly $110 million of associated capital expenditures, will quantity to
roughly $220 million.

UGI Worldwide. At our UGI Worldwide LPG enterprise, we launched an
initiative in Fiscal 2019 and launched into a strategy of figuring out operational
synergies throughout all 17 nations through which we at the moment do enterprise. The aim of
this initiative (Undertaking Alliance) was to focus consideration on enhanced buyer
service and secure and environment friendly operations by the institution of two
facilities of excellence. One heart focuses on industrial excellence to determine
and execute initiatives that enhance the client's expertise. The second heart
focuses on operational excellence throughout our distribution community and our
filling facilities. These enterprise actions are considerably full and are
anticipated to generate over €30 million of annual advantages by the tip of Fiscal
2022. The entire cumulative value of executing these Undertaking Alliance initiatives,
together with roughly €10 million associated to IT capital expenditures, will
quantity to roughly €55 million.

Non-GAAP Monetary Measures
UGI administration makes use of "adjusted web earnings attributable to UGI Company" and
"adjusted diluted earnings per share," each of that are non-GAAP monetary
measures, when evaluating UGI's total efficiency. Administration believes that
these non-GAAP measures present significant data to buyers about UGI's
efficiency as a result of they remove positive factors and losses on commodity and sure
overseas forex spinoff devices not related to current-period
transactions and different vital discrete objects that may have an effect on the comparability
of period-over-period outcomes.
UGI doesn't designate its commodity and sure overseas forex spinoff
devices as hedges below GAAP. Volatility in web earnings attributable to UGI
Company can happen because of positive factors and losses on such spinoff
devices not related to current-period transactions. These positive factors and
losses end result principally from recording modifications in unrealized positive factors and losses
on unsettled commodity and sure overseas forex spinoff devices and,
to a a lot lesser extent, sure realized positive factors and losses on settled commodity
spinoff devices that aren't related to current-period transactions.
Nevertheless, as a result of these spinoff devices economically hedge anticipated
future purchases or gross sales of power commodities, or within the case of sure
overseas forex derivatives, scale back volatility in anticipated future earnings
related to our overseas operations, we count on that such positive factors or losses will
be largely offset by positive factors or losses on anticipated future power commodity
transactions or mitigate volatility in anticipated future earnings. Non-GAAP
monetary measures should not in accordance with, or an alternative choice to, GAAP and
must be thought-about along with, and never as an alternative to, the comparable
GAAP measures.
The next tables replicate the changes referred to above and reconcile web
earnings attributable to UGI Company, probably the most immediately comparable GAAP
measure, to adjusted web earnings attributable to UGI Company, and reconcile
diluted earnings per share, probably the most comparable GAAP measure, to adjusted
diluted earnings per share:
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                                                                             12 months Ended September 30,
(Thousands and thousands of {dollars}, besides per share quantities)                               2021                2020
Adjusted web earnings attributable to UGI Company:
AmeriGas Propane                                                         $        168          $    156
UGI Worldwide                                                                 221               173
Midstream & Advertising                                                             107                92
UGI Utilities                                                                     144               136
Company & Different (a)                                                             827               (25)
Web earnings attributable to UGI Company                                      1,467               532

Web positive factors on commodity derivatives not linked to transactions throughout the present interval (web of tax of $ 389 and $ 35, respectively)

                                                                  (1,001)              (82)

Unrealized losses (positive factors) on spinoff devices in foreign currency echange (web of tax $ 2 and (10) $, respectively)

                             (6)               26

Acquisition and integration prices associated to the Acquisition of CMG (web of tax of $ 0 and $ (1), respectively)

                               -                 1

Enterprise transformation prices (web of tax of ($ 27) and $ (17), respectively)

                                                                      74                45

Loss on disposal of Conemaugh and HVAC (web of taxes $ 0 and
$ (15), respectively)

                                                                -                39

Acquisition and integration prices associated to the acquisition of Mountaineer (web of tax of $ (4) and $ 0, respectively)

                  10                 -

Intangible depreciation of the client relationship (web of tax of (5) $
and $ 0, respectively)

                                                              15                 -

Depreciation of an funding in PennEast (web of tax of $ 0 and $ 0, respectively)

                                                                      93                 -
Impression of change in Italian tax legislation                                               (23)                -
Whole changes (a) (b)                                                        (838)               29
Adjusted web earnings attributable to UGI Company                      $  

629 $ 561

Adjusted diluted earnings per share:
AmeriGas Propane                                                         $       0.79          $   0.74
UGI Worldwide                                                                1.04              0.82
Midstream & Advertising                                                            0.51              0.44
UGI Utilities                                                                    0.68              0.65
Company & Different (a)                                                            3.90             (0.11)
Earnings per share - diluted                                                     6.92              2.54

Web positive factors on commodity derivatives unrelated to transactions within the present interval

                                                     (4.72)            (0.39)

(positive factors) unrealized losses on spinoff devices in foreign currency echange

                                                                     (0.03)             0.12

Acquisition and integration prices associated to the acquisition of CMG

                                                                         -              0.01
Enterprise transformation bills                                                 0.35              0.21
Loss on disposals of Conemaugh and HVAC                                             -              0.18

Acquisition and integration prices associated to the acquisition of Mountaineer

                                                          0.04                 -
Impairment of buyer relationship intangible                                   0.07                 -
Impairment of funding in PennEast                                             0.44                 -
Impression of change in Italian tax legislation                                             (0.11)                -
Whole changes (a)                                                           (3.96)             0.13
Adjusted diluted earnings per share                                      $  

2.96 $ 2.67



(a)Company & Different contains sure changes made to our reporting segments
in arriving at web earnings attributable to UGI Company. These changes
have been excluded from the phase outcomes to align with the measure utilized by
our CODM in assessing phase efficiency and allocating assets. See Observe 23
to Consolidated Monetary Statements for added data associated to those
changes, in addition to different objects included inside Company & Different.
(b)Earnings taxes related to pre-tax changes decided utilizing statutory
enterprise unit tax charges.

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Fiscal yr 2021 in comparison with fiscal yr 2020

Dialogue. Web earnings attributable to UGI Company was $1,467 million for
Fiscal 2021 (equal to $6.92 per diluted share) in comparison with $532 million for
Fiscal 2020 (equal to $2.54 per diluted share). Web earnings attributable to UGI
Company in Fiscal 2021 displays a $951 million year-over-year improve in
web unrealized positive factors on commodity spinoff devices and sure overseas
forex spinoff devices. This improve is primarily attributable to the
vital rise in commodity costs throughout Fiscal 2021, and has contributed to
the buildup of considerable spinoff belongings associated to the Firm's
commodity spinoff devices at September 30, 2021. Fiscal 2021 web earnings
attributable to UGI Company additionally displays larger enterprise transformation
bills, impairments of investments and long-lived belongings, and acquisition and
integration bills in comparison with the prior yr, in addition to a $23 million tax
profit associated to an election made in reference to a tax legislation change in
Italy. Fiscal 2020 web earnings attributable to UGI Company features a $39
million loss on belongings that had been disposed of in September 2020.

Adjusted web earnings attributable to UGI Company for Fiscal 2021 was $629
million (equal to $2.96 per diluted share) in comparison with adjusted web earnings
attributable to UGI Company for Fiscal 2020 of $561 million (equal to $2.67
per diluted share). The rise in adjusted web earnings attributable to UGI
Company throughout Fiscal 2021 displays larger earnings contributions from every
of our 4 enterprise segments together with improved margin at UGI Worldwide
which benefited from colder climate in comparison with the prior yr and the
translation results of stronger foreign currency echange. Larger common LPG unit
margins together with the continued results of margin administration efforts, the
improve in base charges at UGI Utilities, Inc. in Fiscal 2021, and the consequences of
acquisitions and belongings positioned into service because the fourth quarter of Fiscal
2020 additionally contributed to the development. These constructive impacts had been partially
offset by larger depreciation and amortization expense and a decrease profit below
the CARES Act in comparison with the prior yr.
AmeriGas Propane's adjusted web earnings attributable to UGI Company elevated
$12 million throughout Fiscal 2021. This improve principally displays decrease
working and administrative bills, together with partial advantages associated to the
execution of transformation initiatives, larger different earnings attributable to
buyer charges and positive factors on the early settlement of sure commodity spinoff
devices throughout Fiscal 2021, and decrease curiosity and depreciation and
amortization expense in comparison with the prior yr. These constructive elements had been
partially offset by decrease retail propane margin primarily attributable to decrease
volumes.
UGI Worldwide's adjusted web earnings attributable to UGI Company
elevated $48 million throughout Fiscal 2021 principally reflecting elevated LPG
volumes which benefited from colder climate in comparison with Fiscal 2020, larger
common LPG unit margins together with efficient margin administration efforts, and the
translation results of stronger foreign currency echange. These constructive elements had been
partially offset by larger working and administrative bills reflecting
elevated upkeep and distribution prices attributable to the stronger LPG
volumes in comparison with Fiscal 2020, in addition to the beforehand talked about results of
stronger foreign currency echange.
Midstream & Advertising adjusted web earnings in Fiscal 2021 was $15 million larger
than the prior yr. This improve principally displays incremental margin from
capability administration and renewable power advertising actions, and decrease
working and administrative bills largely associated to the affect of divested
belongings.
UGI Utilities Fiscal 2021 adjusted web earnings elevated $8 million in comparison with
the prior yr. This improve displays larger pure gasoline margin largely
attributable to the rise in base charges that went into impact in Fiscal 2021
and better margin from massive supply service clients, and a rise in
Electrical Utility margin ensuing from larger volumes in comparison with the prior
yr. These enhancements had been partially offset by larger working and
administrative bills attributable to the consequences of the Mountaineer
Acquisition and elevated depreciation expense associated to continued capital
expenditure exercise.
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AmeriGas Propane                                        2021              2020                  Improve (Lower)
({Dollars} in hundreds of thousands)
Revenues                                             $  2,614          $  2,381          $       233                 10  %
Whole margin (a)                                     $  1,397          $  1,421          $       (24)                (2) %
Working and administrative bills                $    869          $    890          $       (21)                (2) %
Working earnings / earnings earlier than curiosity
expense and earnings taxes                             $    385          $    373          $        12                  3  %
Retail gallons offered (hundreds of thousands)                            968               987                  (19)                (2) %
Diploma days - % hotter than regular (b)                   (2.8) %           (0.7) %                 -                  -


(a)Whole margin represents revenues much less value of gross sales.
(b)Starting in Fiscal 2021, deviation from common heating diploma days is
decided on a rolling 10-year interval using volume-weighted climate knowledge
primarily based on climate statistics offered by NOAA for 344 areas in the United
States, excluding Alaska and Hawaii. Prior-period quantities have been restated to
conform to the current-period presentation.

Common temperatures throughout Fiscal 2021 had been 2.8% hotter than regular and a couple of.2%
hotter than the prior yr. Whole retail gallons offered decreased throughout Fiscal
2021 principally reflecting structural conservation and different residual quantity
loss and the larger affect of COVID-19 on industrial volumes in comparison with Fiscal
2020. These decreases had been partially offset by larger resale and motor gasoline
volumes throughout Fiscal 2021.

Whole revenues elevated $233 million throughout Fiscal 2021 largely reflecting
larger common propane promoting costs ($255 million) and elevated wholesale
volumes ($26 million) partially offset by the decrease retail propane volumes ($39
million) in comparison with Fiscal 2020. Common each day wholesale propane commodity
costs throughout Fiscal 2021 at Mont Belvieu, Texas, one of many main provide factors
within the U.S., had been roughly 97% larger than such costs throughout Fiscal 2020.
Whole value of gross sales elevated $257 million throughout Fiscal 2021 largely
attributable to the upper common propane product prices ($245 million) and
larger wholesale propane volumes ($24 million), partially offset by the decrease
retail propane volumes ($16 million).

AmeriGas Propane complete margin decreased $24 million in Fiscal 2021 largely
attributable to the decrease retail propane volumes ($24 million) and decreased
non-propane margin ($13 million) principally reflecting decrease charges and companies
partially offset by elevated cylinder gross sales. These decreases had been partially
offset by larger common propane margin ($10 million) ensuing from the rising
propane value surroundings and efficient margin administration efforts.

Working earnings and earnings earlier than curiosity expense and earnings taxes elevated
$12 million throughout Fiscal 2021 reflecting decrease working and administrative
bills ($21 million) in comparison with Fiscal 2020, larger different earnings ($10
million) attributable to buyer charges and positive factors on the early settlement of
sure commodity spinoff devices throughout Fiscal 2021, and decrease
depreciation and amortization expense ($5 million). These constructive impacts had been
largely offset by the beforehand talked about lower in complete margin ($24
million). The lower in working and administrative bills in Fiscal 2021
displays, amongst different issues, decrease worker compensation and benefits-related
prices ($26 million), decreased gear working and upkeep bills ($7
million), and decrease common insurance coverage prices ($4 million) in comparison with Fiscal
2020. These decreases had been partially offset by elevated promoting bills
($7 million) and better automobile lease expense ($4 million) in comparison with Fiscal
2020. The decrease working and administrative bills replicate the partial
advantages associated to the beforehand talked about ongoing enterprise transformation
initiatives.

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UGI Worldwide                                       2021              2020                      Improve
({Dollars} in hundreds of thousands)
Revenues                                             $  2,651          $  2,127          $     524                 25  %
Whole margin (a)                                     $  1,053          $    908          $     145                 16  %
Working and administrative bills                $    622          $    545          $      77                 14  %
Working earnings                                     $    314          $    241          $      73                 30  %
Earnings earlier than curiosity expense and earnings
taxes                                                $    317          $    259          $      58                 22  %
LPG retail gallons offered (hundreds of thousands)                        792               757                 35                  5  %
Diploma days - % colder (hotter) than regular
(b)                                                       0.4  %          (12.7) %               -                  -


(a)Whole margin represents complete revenues much less complete value of gross sales and in Fiscal
2020, LPG cylinder filling prices of $28 million. For monetary assertion
functions, LPG cylinder filling prices in Fiscal 2020 are included in "Working
and administrative bills" on the 2020 Consolidated Assertion of Earnings (however
are excluded from working and administrative bills introduced above). LPG
cylinder filling prices are included in "Value of gross sales" on the 2021 Consolidated
Assertion of Earnings.
(b)Starting in Fiscal 2021, deviation from common heating diploma days is
decided on a rolling 10-year interval using volume-weighted climate knowledge at
places in our UGI Worldwide service territories. Prior-period quantities
have been restated to evolve to the current-period presentation.

Common temperatures throughout Fiscal 2021 had been barely colder than regular and
14.1% colder than Fiscal 2020. Whole LPG retail gallons offered throughout Fiscal 2021
elevated 5% in comparison with Fiscal 2020 largely attributable to larger bulk volumes
reflecting the consequences of the colder climate on heating-related bulk gross sales.
These quantity enhancements additionally replicate small acquisitions in Switzerland and
Finland and the restoration of sure quantity decreases attributable to COVID-19
throughout Fiscal 2021, and had been partially offset by the termination of a
high-volume, low-margin autogas contract in Italy throughout Fiscal 2020. Common
wholesale costs for propane and butane throughout Fiscal 2021 in northwest Europe
had been roughly 52% and 33% larger, respectively, in comparison with Fiscal 2020.

UGI Worldwide base-currency outcomes are translated into U.S. {dollars} primarily based
upon change charges skilled throughout the reporting durations. The useful
forex of a good portion of our UGI Worldwide outcomes is the euro
and, to a a lot lesser extent, the British pound sterling. Throughout Fiscal 2021 and
Fiscal 2020, the common unweighted euro-to-dollar translation charges had been
roughly $1.20 and $1.12, respectively, and the common unweighted British
pound sterling-to-dollar translation charges had been roughly $1.37 and $1.28,
respectively. Fluctuations in these overseas forex change charges can have a
vital affect on the person monetary assertion parts mentioned
under. The web impact of modifications in overseas forex change charges on UGI
Worldwide's earnings earlier than curiosity expense and earnings taxes resulted in a
web good thing about $26 million in Fiscal 2021. Nevertheless, the affect of those modifications
is mitigated by the consequences of ahead overseas forex change contracts
entered into over a multi-year interval supposed to considerably offset this
volatility. These ahead overseas forex change contracts resulted in
realized web positive factors of $1 million and $15 million, respectively, in Fiscal 2021
and Fiscal 2020.

UGI Worldwide revenues and value of gross sales elevated $524 million and $379
million, respectively, throughout Fiscal 2021. The rise in revenues and value of
gross sales principally displays the interpretation results of stronger overseas
currencies (roughly $174 million and $102 million, respectively), the
results of upper common butane and propane promoting costs and product prices
in comparison with Fiscal 2020, and the beforehand talked about improve in bulk volumes.
Power advertising actions additionally contributed to the elevated revenues and value
of gross sales throughout Fiscal 2021 largely associated to larger pure gasoline volumes and
costs.

UGI Worldwide complete margin elevated $145 million throughout Fiscal 2021
reflecting the interpretation results of stronger foreign currency echange (roughly
$72 million), the beforehand talked about improve in complete LPG volumes, decrease
prices related to power conservation certificates, and better common LPG
unit margins together with the continued results of margin administration efforts. These
margin enhancements embrace the affect of LPG belongings acquired in Fiscal 2021 and
larger margin from power advertising actions principally reflecting elevated
pure gasoline volumes.

UGI Worldwide working earnings and earnings earlier than curiosity expense and
earnings taxes elevated $73 million and $58 million, respectively, throughout Fiscal
2021. The rise in working earnings principally displays the rise in
complete margin partially offset by larger working and administrative bills
($77 million) which was largely attributable to the consequences of stronger overseas
currencies ($38 million) in comparison with Fiscal 2020. The rise in working and
administrative bills additionally displays larger upkeep, distribution and
worker compensation prices attributable to the elevated volumes. The rise
in earnings earlier than curiosity expense and earnings taxes in Fiscal 2021 largely
displays the rise in working earnings partially
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offset by decrease realized positive factors on overseas forex change contracts entered
into with the intention to scale back volatility in UGI Worldwide earnings ensuing from
the consequences of modifications in overseas forex change charges ($14 million).

Midstream & Advertising                                   2021              2020                  Improve (Lower)
({Dollars} in hundreds of thousands)
Revenues                                             $  1,406          $  1,247          $       159                 13  %
Whole margin (a)                                     $    373          $    355          $        18                  5  %
Working and administrative bills                $    129          $    140          $       (11)                (8) %
Working earnings                                     $    160          $    140          $        20                 14  %
Earnings earlier than curiosity expense and earnings
taxes                                                $    190          $    168          $        22                 13  %


(a) Whole margin represents complete income much less complete value of gross sales.

Common temperatures throughout Midstream & Advertising's power advertising territory
throughout Fiscal 2021 had been 6.9% hotter than regular and a couple of.6% hotter than the prior
yr. Midstream & Advertising's prior yr outcomes embrace contributions from
working actions attributable to its HVAC enterprise and possession curiosity in
Conemaugh, each of which had been offered in September 2020. Losses related to the
disposal of those belongings are mirrored in "Company & Different" (see "Non-GAAP
Monetary Measures" above).

Midstream & Advertising's revenues elevated $159 million in comparison with the prior
yr principally reflecting elevated revenues from pure gasoline ($144 million)
and renewable power ($27 million) advertising actions and better capability
administration revenues ($24 million) which had been impacted by the timing of sure
mark-to-market contract settlements. Larger revenues related to electrical energy
advertising ($8 million) and pure gasoline gathering actions ($6 million) additionally
contributed to the rise. These elements had been partially offset by the absence
of revenues attributable to its former HVAC enterprise and possession curiosity in
Conemaugh ($59 million). Midstream & Advertising value of gross sales was $1,033 million
in Fiscal 2021 in comparison with $892 million in Fiscal 2020. The $141 million
improve principally displays larger value of gross sales associated to pure gasoline ($138
million), renewable power ($20 million), and electrical energy ($7 million) advertising
actions, partially offset by the absence of prices attributable to HVAC and
Conemaugh ($30 million). The will increase in each pure gasoline revenues and value of
gross sales throughout Fiscal 2021 are largely attributable to larger common pure gasoline
costs in comparison with the prior yr partially offset by decrease volumes attributable
to climate that was hotter than the prior yr.

Midstream & Advertising complete margin elevated $18 million in Fiscal 2021
reflecting improved capability administration margin ($24 million), larger margin from
renewable power ($7 million) and pure gasoline ($5 million) advertising actions,
and better margin from pure gasoline gathering actions ($6 million). These
margin enhancements embrace the affect of acquisitions and new belongings positioned
into service because the fourth quarter of Fiscal 2020, and had been partially offset
by the absence of margins attributable to HVAC and Conemaugh ($29 million).

Midstream & Advertising working earnings and earnings earlier than curiosity expense and
earnings taxes throughout Fiscal 2021 elevated $20 million and $22 million,
respectively, in comparison with the prior yr. The rise in working earnings
principally displays the rise in complete margin and decrease working and
administrative bills in comparison with the prior yr, partially offset by an
adjustment to the contingent consideration associated to the GHI acquisition ($9
million). The lower in working and administrative bills was largely
associated to the absence of the beforehand talked about divested belongings partially
offset by a rise in worker and benefits-related prices and will increase
associated to new belongings positioned into service. The rise in earnings earlier than
curiosity expense and earnings taxes displays the development in working earnings
and incremental fairness technique earnings associated to the funding in Pine Run.
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UGI Utilities                                               2021          2020            Improve
({Dollars} in hundreds of thousands)
Revenues                                                 $ 1,079       $ 1,030       $    49       5  %
Whole margin (a)                                         $   616       $   577       $    39       7  %
Working and administrative bills (a)                $   254       $   239       $    15       6  %
Working earnings                                         $   241       $   229       $    12       5  %
Earnings earlier than curiosity expense and earnings taxes        $   242       $   229       $    13       6  %
Pure gasoline system throughput - bcf
   Core market                                                77            75             2       3  %
   Whole                                                     311           310             1       -  %
Electrical Utility distribution gross sales - gwh                    998           978            20       2  %

Pure gasoline diploma days -% hotter than regular (b) (7.9)% (6.9)% – –


(a)Whole margin represents complete revenues much less complete value of gross sales and
revenue-related taxes (i.e. Electrical Utility gross receipts taxes) of $5 million
in each Fiscal 2021 and Fiscal 2020. For monetary assertion functions,
revenue-related taxes are included in "Working and administrative bills" on
the Consolidated Statements of Earnings (however are excluded from working bills
introduced above).
(b)Starting in Fiscal 2021, deviation from common heating diploma days is
decided on a rolling 10-year interval using volume-weighted climate knowledge
primarily based on climate statistics offered by NOAA for airports positioned inside UGI
Utilities pure gasoline service territory. Prior-period quantities have been restated
to evolve to the current-period presentation.

Temperatures in UGI Utilities' pure gasoline service territory throughout Fiscal 2021
had been 7.9% hotter than regular and barely hotter than the prior yr. UGI
Utilities' core market volumes elevated (2 bcf) throughout Fiscal 2021 reflecting
the consequences of continued development within the variety of core market clients and the
restoration of sure quantity decreases attributable to COVID-19 throughout Fiscal
2021, partially offset by the hotter climate in comparison with the prior yr. Whole
pure gasoline distribution system throughput elevated barely throughout Fiscal 2021
primarily attributable to the affect of the Mountaineer Acquisition and the
improve in core market volumes, partially offset by decrease massive supply
service volumes. Electrical Utility distribution gross sales volumes elevated throughout
Fiscal 2021 primarily attributable to buyer development.
UGI Utilities revenues elevated $49 million in Fiscal 2021 reflecting a $42
million improve in pure gasoline revenues and a $7 million improve in Electrical
Utility revenues. The rise in pure gasoline revenues principally displays the
improve in base charges that went into impact as a part of a phased method on
January 1, 2021 and July 1, 2021, larger revenues from off system gross sales, and
incremental revenues attributable to the Mountaineer acquisition ($9 million) in
September 2021. These elements had been partially offset by decrease PGC charges in contrast
to the prior yr. The rise in Electrical Utility revenues throughout Fiscal 2021
is basically attributable to the elevated distribution gross sales volumes and better
DS charges in comparison with the prior yr.

UGI Utilities value of gross sales was $458 million in Fiscal 2021 in contrast with $448
million in Fiscal 2020 reflecting larger pure gasoline ($8 million) and Electrical
Utility ($2 million) value of gross sales in comparison with the prior yr. Larger pure
gasoline value of gross sales related to off system gross sales and incremental value of gross sales
associated to Mountaineer had been partially offset by decrease PGC charges in comparison with the
prior yr. Electrical Utility value of gross sales elevated throughout Fiscal 2021
reflecting the elevated volumes and DS charges in comparison with the prior yr.

UGI Utilities complete margin elevated $39 million throughout Fiscal 2021 reflecting
larger pure gasoline margin ($34 million) and Electrical Utility margin ($5
million). The rise in pure gasoline margin displays larger margin from core
market clients ($18 million) largely attributable to the beforehand talked about
improve in base charges, incremental margin attributable to Mountaineer ($6
million), and better margin from massive supply service clients. The elevated
pure gasoline margin additionally benefited from the implementation of a DSIC efficient
April 1, 2021 and better buyer account charges in comparison with the prior yr. The
improve in Electrical Utility margin is basically attributable to the rise in
distribution gross sales volumes in comparison with the prior yr.

UGI Utilities working earnings and earnings earlier than curiosity expense and earnings
taxes throughout Fiscal 2021 elevated $12 million and $13 million, respectively,
in comparison with the prior yr. These will increase largely replicate the beforehand
talked about improve in complete margin, partially offset by larger working and
administrative bills ($15 million) and depreciation expense ($14 million)
in comparison with the prior yr. The rise in working and administrative
bills displays incremental actions associated to Mountaineer ($7 million) as
effectively as larger contracted labor bills and worker prices. The upper
depreciation expense in comparison with the prior yr contains the consequences of
continued distribution system and IT capital expenditure exercise and
incremental depreciation attributable to Mountaineer.
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Curiosity costs and earnings taxes

Our consolidated curiosity expense throughout Fiscal 2021 was $310 million in contrast
to $322 million throughout the prior yr. The $12 million lower in curiosity
expense principally displays decrease common short-term borrowings excellent
in comparison with the prior yr, partially offset by incremental curiosity on the UGI
Utilities, Inc.'s senior notes issued throughout the yr.

Our efficient earnings tax charge elevated between Fiscal 2021 and Fiscal 2020 due
primarily to a rise within the focus of overseas earnings largely
attributable to positive factors on commodity derivatives reflecting overseas statutory tax
charges that exceed the U.S. statutory charge and a decrease NOL profit below the
CARES Act in comparison with the prior yr. These things had been partially offset by an
election made within the present yr out there below a tax legislation change in Italy
which allowed the Firm to step up its tax foundation on sure belongings in change
for paying a 3 p.c substitute tax in reference to such election. This
election resulted in a $23 million web profit within the present interval ensuing
in incremental tax foundation that shall be deductible in future durations. For
extra data on our earnings taxes, together with tax legislation modifications, see Observe
7 to Consolidated Monetary Statements.

Monetary scenario and liquidity

The Firm expects to have adequate liquidity together with money available and
out there borrowing capability to proceed to assist long-term commitments and
ongoing operations regardless of uncertainties related to the outbreak and
continued affect of COVID-19. Our complete out there liquidity steadiness, comprising
money and money equivalents and out there borrowing capability on our revolving
credit score services, totaled roughly $2.2 billion and $1.5 billion at
September 30, 2021 and 2020, respectively. Our complete out there liquidity at
September 30, 2021 contains $468 million of money collateral obtained from
spinoff counterparties ensuing from the affect of rising commodity costs
and an accumulation of spinoff belongings related to our commodity
spinoff devices. The Firm doesn't have any near-term senior observe or
time period mortgage maturities. Whereas the Firm's operations and monetary efficiency
proceed to be impacted by COVID-19, it's a quickly evolving scenario and the
Firm can not predict the last word affect that COVID-19 could have on its
liquidity, debt covenants, monetary situation or the timing of capital
expenditures. UGI and its subsidiaries had been in compliance with all debt
covenants as of September 30, 2021.

We rely on each inside and exterior sources of liquidity to supply funds
for working capital and to fund capital necessities. Our short-term money
necessities not met by money generated from operations are typically happy
with borrowings below credit score services and, within the case of Midstream &
Advertising, additionally from a Receivables Facility. Lengthy-term money necessities are
typically met by the issuance of long-term debt or fairness securities. We
imagine that every of our enterprise items has adequate liquidity within the types of
money and money equivalents available; money anticipated to be generated from
operations; credit score facility and Receivables Facility borrowing capability; and the
potential to acquire long-term financing to satisfy anticipated contractual and
projected money commitments. Issuances of debt and fairness securities within the
capital markets and extra credit score services might not, nonetheless, be out there
to us on acceptable phrases.

The first sources of UGI's money and money equivalents are the dividends and
different money funds made to UGI or its company subsidiaries by its principal
enterprise items. Our money and money equivalents totaled $855 million at
September 30, 2021, in contrast with $336 million at September 30, 2020. Our money
and money equivalents at September 30, 2021 contains the beforehand talked about
$468 million of money collateral deposits obtained from our spinoff instrument
counterparties. That is attributable to vital mark-to-market positive factors on our
commodity spinoff devices ensuing from the steep rise in commodity
costs throughout Fiscal 2021. This money might be returned to such counterparties as
commodity costs and their affect to our commodity spinoff devices
stabilizes or reverses. Excluding these collateral deposits obtained and money
and money equivalents that reside at UGI's working subsidiaries, at
September 30, 2021 and 2020, our money and money equivalents totaled $172 million
and $112 million, respectively. Such money is out there to pay dividends on UGI
Widespread Inventory and for funding functions.
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Throughout Fiscal 2021 and Fiscal 2020, our principal enterprise items paid money
dividends and made different money funds to UGI and its subsidiaries as follows:
(Thousands and thousands of {dollars})       2021       2020

AmeriGas Propane           $ 135      $ 108
UGI Worldwide (a)        212        250
Midstream & Advertising         25         50
UGI Utilities                 35         50
Whole                      $ 407      $ 458



(a)  Represents money funds to UGI Worldwide's U.S. holding firm
subsidiary. Money dividends in Fiscal 2020 had been used, partly, to pay down all
excellent revolving credit score facility borrowings on the UGI Worldwide Credit score
Services Settlement in September 2020.

Widespread and most popular shares

Issuance of fairness items

On Might 25, 2021, the Firm issued 2.2 million Fairness Models with a complete
notional worth of $220 million. Every Fairness Unit has a said quantity of $100 and
consists of (1) a ten% undivided useful possession curiosity in a single share of
Convertible Most popular Inventory with a liquidation desire of $1,000 per share
and (2) a 2024 Buy Contract. The Firm obtained roughly $213
million in proceeds from the issuance of the Fairness Models, web of providing
bills and underwriting prices and commissions, and issued 220,000 shares of
Convertible Most popular Inventory, recording $213 million in "Most popular inventory" on the
accompanying Consolidated Steadiness Sheet. The proceeds had been used to pay a portion
of the acquisition value for the Mountaineer Acquisition and associated charges and
bills, and for common company functions. For added data on the
Mountaineer Acquisition and the issuance of Fairness Models, see Notes 5 and 13 to
the Consolidated Monetary Statements.
Dividends
Quarterly dividends per share of UGI Widespread Inventory paid throughout Fiscal 2021 and
Fiscal 2020 had been as follows:
                    2021         2020
1st Quarter       $ 0.330      $ 0.325
2nd Quarter           0.330        0.325
third Quarter           0.345        0.330
4th Quarter           0.345        0.330
Whole             $ 1.350      $ 1.310


On November 18, 2021, UGI's Board of Administrators declared a money dividend equal to
$0.345 per widespread share. The dividend shall be payable on January 1, 2022, to
shareholders of file on December 15, 2021.

Repurchases of extraordinary shares

Throughout Fiscal 2020, the Firm repurchased 1 million shares at a complete buy
value of $38 million. There have been no such repurchases throughout Fiscal 2021. For
extra data on the authorization of those repurchases, see Observe 13 to
the Consolidated Monetary Statements.
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Lengthy-term debt and credit score services

The Firm's debt excellent at September 30, 2021 and 2020, includes the
following:
                                                                                       2021                                                                     2020
                               AmeriGas                                       Midstream &                                   Corp. &
(Thousands and thousands of {dollars})          Propane            UGI Worldwide            Advertising             UGI Utilities           Different            Whole            Whole
Brief-term borrowings        $     170          $                -          $           -          $          197          $     -          $   367          $   347

Lengthy-term debt (together with
present maturities):
Senior notes                 $   2,575          $              405          $           -          $        1,290          $     -          $ 4,270          $ 3,960
Time period loans                           -                         347                    684                     142              765            1,938            1,741
Different long-term debt                 1                          23                     42                      25              192              283              380
Unamortized debt issuance
prices                              (16)                         (5)                   (10)                     (6)              (5)             (42)             (47)
Whole long-term debt         $   2,560          $              770          $         716          $        1,451          $   952          $ 6,449          $ 6,034
Whole debt                   $   2,730          $              770          $         716          $        1,648          $   952          $ 6,816          $ 6,381

Important fundraising actions

Mountaineer. As additional described in Observe 5 to the consolidated monetary
statements, UGI acquired Mountaineer on September 1, 2021. Mountaineer has a
credit score facility settlement which gives for borrowings as much as $100 million, with
an possibility to extend the utmost borrowing capability to $200 million. The credit score
facility settlement is scheduled to run out in November 2024, with the choice to
prolong the maturity for as much as two extra one-year durations. Borrowings below
this credit score facility settlement bear curiosity at (1) a chief charge plus a margin
or (2) an adjusted LIBOR plus a margin. Such margin relies upon
Mountaineer's unsecured debt ranking.

Mountaineer additionally has a number of unsecured senior notes and principal quantities are
due in full at maturity. Curiosity is payable on a semiannual foundation in June and
December for every of those senior notes. See Observe 6 to the Consolidated
Monetary Statements for additional data on these senior notes.

UGI Utilities, Inc.'s Senior Notes. On Might 7, 2021, UGI Utilities, Inc. entered
right into a Observe Buy Settlement with a consortium of lenders. Pursuant to the
Observe Buy Settlement, UGI Utilities, Inc. issued $100 million combination
principal quantity of 1.59% Senior Notes due June 15, 2026 and $75 million
combination principal quantity of 1.64% Senior Notes due September 15, 2026 in June
and September 2021, respectively. The web proceeds from these issuances had been
used to scale back short-term borrowings and for common company functions.

2021 UGI Company Senior Credit score Facility. On Might 4, 2021, UGI amended the
present UGI Company Senior Credit score Facility. The 2021 UGI Company Senior
Credit score Facility (1) extends the maturity date of the earlier three-year $300
million time period mortgage included within the present UGI Company Senior Credit score
Facility, which is now due in Might 2025; and (2) features a new four-year $215
million time period mortgage dedication. Proceeds from new time period mortgage borrowings below the
2021 UGI Company Senior Credit score Facility had been used to finance a portion of
the Mountaineer Acquisition and for common company functions.

Borrowings on the brand new time period mortgage below the 2021 UGI Company Senior Credit score
Facility bear curiosity topic to our election, at both (1) the related
prime charge plus a margin or (2) an adjusted LIBOR or an alternate benchmark charge
plus a margin and are due of their entirety on the maturity date. The relevant
margin on the brand new borrowings, which relies upon a ratio of consolidated
web indebtedness to consolidated EBITDA, as outlined, or UGI's credit score scores,
ranges from 0.125% to 1.50% if the prime charge possibility is elected and 1.125% to
2.50% if the LIBOR possibility is elected.

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Credit score Services

Details about the Firm's principal credit score agreements (excluding Power
Companies' Receivables Facility, which is mentioned under) as of September 30,
2021 and 2020, is introduced within the tables under.
                                                                                                                       Letters of
                                                                                                                       Credit score and              Accessible           Weighted Common
                                                                                                Borrowings             Ensures              Borrowing           Curiosity Price -
(Forex in hundreds of thousands)                     Expiration Date            Whole Capability            Excellent            Excellent             Capability              Finish of 12 months
September 30, 2021
AmeriGas OLP                                December 2022           $           600          $          170          $         60          $          370                   2.58  %
UGI Worldwide, LLC (a)                   October 2023           €           300          €            -          €          -          €          300                      N.A.
Power Companies                               March 2025            $           260          $            -          $          -          $          260                      N.A.
UGI Utilities, Inc.                           June 2024             $           350          $          130          $          -          $          220                   1.35  %
Mountaineer                                 November 2024           $           100          $           67          $          -          $           33                      N.M.
UGI Company (b)                          August 2024            $           300          $          185          $          -          $          115                   3.27  %
September 30, 2020
AmeriGas OLP                                December 2022           $           600          $          186          $         62          $          352                   2.61  %
UGI Worldwide, LLC (a)                   October 2023           €           300          €            -          €          -          €          300                      N.A.
Power Companies                               March 2025            $           260          $            -          $          -          $          260                      N.A.
UGI Utilities, Inc.                           June 2024             $           350          $          141          $          -          $          209                   1.12  %
UGI Company (b)                          August 2024            $           300          $          300          $          -          $            -                   2.41  %


(a)The UGI Worldwide Credit score Services Settlement permits UGI Worldwide,
LLC to borrow in euros or {dollars}.
(b)Borrowings excellent have been labeled as "Lengthy-term debt" on the
Consolidated Steadiness Sheets. In October 2021 and 2020, the Firm repaid $70
million and $30 million, respectively, of such borrowings and labeled these
repayments as "Present maturities of long-term debt" on the Consolidated Steadiness
Sheets.
N.A. - Not relevant
N.M. - Not significant

Every day and peak short-term borrowings below the Firm’s main credit score agreements throughout fiscal 2021 and 2020 are as follows:

                                      2021                     2020
(Forex in hundreds of thousands)         Common       Peak       Common       Peak
AmeriGas OLP                  $    168      $ 293      $    245      $ 359
UGI Worldwide, LLC        €      -      €   -      €    158      € 179
Power Companies               $      3      $  32      $     18      $  77
UGI Utilities, Inc.           $    186      $ 279      $    180      $ 324
Mountaineer                   $     58      $  67      $      -      $   -
UGI Company               $    191      $ 300      $    285      $ 300


Receivables Facility. Power Companies additionally has a Receivables Facility with an
issuer of receivables-backed industrial paper. On October 22, 2021, the
expiration date of the Receivables Facility was prolonged to October 21, 2022.
The Receivables Facility gives Power Companies with the flexibility to borrow up
to $150 million of eligible receivables throughout the interval November by
April, and as much as $75 million of eligible receivables throughout the interval Might
by October. Power Companies makes use of the Receivables Facility to fund working
capital, margin calls below commodity futures contracts, capital expenditures,
dividends and for common company functions.
At September 30, 2021, the excellent steadiness of commerce receivables was $61
million, none of which was offered to the financial institution. At September 30, 2020, the
excellent steadiness of commerce receivables was $50 million of which $19 million
was offered to the financial institution. Quantities offered to the financial institution are mirrored as "Brief-term
borrowings" on the Consolidated Steadiness Sheet. Throughout Fiscal 2021 and Fiscal
2020, peak gross sales of receivables had been $87 million and $97 million, respectively.
Throughout Fiscal 2021 and Fiscal 2020, common each day quantities offered had been $21 million
and $45 million, respectively.
For additional data on the Firm's long-term debt and credit score services,
see Observe 6 to Consolidated Monetary Statements.
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Money Flows
Because of the seasonal nature of the Firm's companies, money flows from
working actions are typically strongest throughout the second and third fiscal
quarters when clients pay for pure gasoline, LPG, electrical energy and different power
services and products consumed throughout the peak heating season months.
Conversely, working money flows are typically at their lowest ranges throughout the
fourth and first fiscal quarters when the Firm's funding in working
capital, principally inventories and accounts receivable, is mostly biggest.
Working Actions:
12 months-to-year variations in our money flows from working actions could be
considerably affected by modifications in working working capital particularly throughout
durations with vital modifications in power commodity costs. Money flows from
working actions in Fiscal 2021 and Fiscal 2020 had been $1,481 million and
$1,102 million, respectively. Money flows from working actions earlier than
modifications in working working capital had been $1,200 million in Fiscal 2021 and
$1,176 million in Fiscal 2020. Adjustments in working working capital offered
(used) working money stream of $281 million in Fiscal 2021 and $(74) million in
Fiscal 2020. Adjustments in working working capital throughout Fiscal 2021 replicate
money generated from modifications in accounts payable and better money obtained for
commodity spinoff instrument collateral deposits within the Fiscal 2021 as
in comparison with Fiscal 2020, in addition to money generated from modifications in earnings taxes
receivable and different present liabilities. These modifications had been partially offset by
a rise in money required to fund modifications in accounts receivable and
inventories as a consequence of rising commodity costs throughout Fiscal 2021, web refunds of
deferred gasoline and energy prices in comparison with web recoveries throughout the Fiscal 2020
in addition to a rise in money required to fund modifications in different present belongings.
Investing Actions:
Investing exercise money stream is principally affected by money expenditures for
property, plant and gear; money paid for acquisitions of companies and
belongings; investments in fairness technique investees; and money proceeds from gross sales and
retirements of property, plant and gear. Money expenditures for property,
plant and gear totaled $690 million in Fiscal 2021 and $655 million in
Fiscal 2020. Money funds for property, plant and gear had been larger in
Fiscal 2021 in contrast with Fiscal 2020 reflecting, partly, the return of regular
capital spending within the absence of curtailments skilled on the onset of the
COVID-19 pandemic in Fiscal 2020. Money used for acquisitions of companies and
belongings in Fiscal 2021 displays UGI's acquisition of Mountaineer. Money used for
investments in fairness technique investees in Fiscal 2021 contains contributions to
Pine Run of $56 million to fund the acquisition of Pine Run Midstream, LLC.
Financing Actions:
Adjustments in money stream from financing actions are primarily as a consequence of issuances
and repayments of long-term debt; short-term borrowings; dividends on UGI Widespread
Inventory; and issuances or repurchases of fairness devices.
Money stream offered by financing actions was $166 million in Fiscal 2021
in comparison with money used to fund financing actions of $635 million in Fiscal
2020. Throughout Fiscal 2021, the Firm obtained $213 million in web money proceeds
from the issuance of Fairness Models and $215 million from the issuance of a brand new
variable charge time period mortgage due in Might 2025. These funds had been used partially to fund
the Mountaineer Acquisition. Additionally throughout Fiscal 2021 and Fiscal 2020, UGI
Utilities, Inc. issued $175 million of senior notes and $150 million of senior
notes, respectively. In Fiscal 2021 and Fiscal 2020, the Firm had web
repayments on credit score services and the Receivables Facility of $35 million and
$449 million, respectively. Money used to fund modifications in financing actions in
Fiscal 2020 contains $38 million of money paid to repurchase UGI Widespread Inventory.
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Capital Expenditures
Within the following desk, we current capital expenditures (which exclude
acquisitions of companies and belongings) for Fiscal 2021 and Fiscal 2020. We additionally
present quantities we count on to spend in Fiscal 2022. We count on to finance a
substantial portion of our Fiscal 2022 capital expenditures from money generated
by operations and money available.
                               2022

(Thousands and thousands of {dollars}) (estimate) 2021 2020

AmeriGas Propane           $      160      $ 130      $ 135
UGI Worldwide                 140        107         89
Midstream & Advertising             130         43         93
UGI Utilities                     545        394        348
Company & Different                  15          -          -
Whole                      $      990      $ 674      $ 665



Capital expenditures at Midstream & Advertising declined throughout Fiscal 2021
primarily as a consequence of using funds to spend money on Pine Run. Elevated ranges of
capital expenditures estimated in Fiscal 2022 replicate pure gasoline infrastructure
growth and investments in renewable power initiatives at Midstream & Advertising;
substitute and betterment initiatives at UGI Utilities, Inc.; and the addition of
Mountaineer's capital expenditure applications.

Contractual Money Obligations and Commitments
The Firm has contractual money obligations that stretch past Fiscal 2021. The
following desk presents contractual money obligations with non-affiliates below
agreements present as of September 30, 2021:
                                                                            

Funds due per interval

                                                                    Fiscal              Fiscal                Fiscal
(Thousands and thousands of {dollars})                              Whole             2022             2023 - 2024           2025 - 2026           Thereafter
Lengthy-term debt (a)                              $  6,491          $    110 

$ 1,505 $ 3,233 $ 1,643
Curiosity on long-term fastened charge debt (a) (b) (c)

                                          1,962               285                   534                   351                  792
Working leases                                     446                92                   152                    99                  103
AmeriGas Propane provide contracts                     17                17                     -                     -                    -
UGI Worldwide provide contracts                   254               254                     -                     -                    -
Midstream & Advertising provide contracts             1,202               466                   252                   103                  381
UGI Utilities development, provide,
storage and transportation contracts                 324               128                   129                    44                   23
By-product devices (d)                            68                44                    23                     1                    -
Whole                                           $ 10,764          $  1,396          $      2,595          $      3,831          $     2,942


(a)Primarily based upon said maturity dates for debt excellent at September 30, 2021.
(b)Primarily based upon said rates of interest adjusted for the consequences of rate of interest
swaps.
(c)Calculated utilizing relevant rates of interest or ahead rate of interest curves,
and UGI's and its subsidiaries' leverage ratios, as of September 30, 2021.
(d)Represents the sum of quantities due if spinoff instrument liabilities had been
settled on the September 30, 2021 quantities mirrored within the Consolidated Steadiness
Sheet (however excluding quantities related to rate of interest contracts).
"Different noncurrent liabilities" included in our Consolidated Steadiness Sheet at
September 30, 2021, principally comprise working lease liabilities (see Observe
16 to Consolidated Monetary Statements); regulatory liabilities (see Observe 9 to
Consolidated Monetary Statements); refundable tank and cylinder deposits (as
additional described in Observe 2 to Consolidated Monetary Statements below the
caption "Refundable Tank and Cylinder Deposits"); litigation, property and
casualty liabilities and obligations below environmental remediation agreements
(see Observe 17 to Consolidated Monetary Statements); pension and different
postretirement profit liabilities recorded in accordance with accounting
steering referring to worker retirement plans (see Observe 8 to Consolidated
Monetary Statements); and liabilities related to government compensation
plans (see Observe 14 to Consolidated Monetary Statements). These liabilities,
aside from working lease liabilities, should not included within the desk
of Contractual Money Obligations and Commitments as a result of they're estimates of
future funds and never contractually fastened as to timing or quantity. Required
minimal contributions to the U.S. Pension Plans (as additional described under
below
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"U.S. Pension Plans") in Fiscal 2022 should not anticipated to be materials. Required
minimal contributions to the U.S. Pension Plans in years past Fiscal 2022 will
rely, largely, on the impacts of future returns on pension plan belongings
and rates of interest on pension plan liabilities.
U.S. Pension Plans
The U.S. Pension Plans include (1) an outlined profit pension plan for
workers employed previous to January 1, 2009, of UGI, UGI Utilities, Inc. and
sure of UGI's different home wholly owned subsidiaries, and (2) a
noncontributory outlined profit pension plan overlaying considerably all
Mountaineer workers. The honest values of the U.S. Pension Plans' belongings totaled
$717 million and $566 million at September 30, 2021 and 2020, respectively. At
September 30, 2021 and 2020, the underfunded positions of the U.S. Pension
Plans, outlined as the surplus of the PBO over the U.S. Pension Plans' belongings,
had been $109 million and $170 million, respectively.
We imagine we're in compliance with laws governing outlined profit
pension plans, together with the ERISA guidelines and laws. Required minimal
contributions to the U.S. Pension Plans in Fiscal 2022 should not anticipated to be
materials. Pre-tax pension value related to the U.S. Pension Plans in Fiscal
2021 was not materials. Pre-tax pension value related to the U.S. Pension
Plans in Fiscal 2022 is just not anticipated to be materials.
GAAP steering related to pension and different postretirement plans typically
requires recognition of an asset or legal responsibility within the assertion of economic
place reflecting the funded standing of pension and different postretirement
profit plans with present yr modifications acknowledged in shareholders' fairness
until such quantities are topic to regulatory restoration. At September 30, 2021,
we now have recorded after-tax costs to UGI Company's stockholders' fairness of
$8 million and recorded regulatory belongings totaling $108 million with the intention to
replicate the funded standing of the U.S. Pension Plans. For a extra detailed
dialogue of the U.S. Pension Plans and our different postretirement profit plans,
see Observe 8 to Consolidated Monetary Statements.

Associated Social gathering Transactions
Throughout Fiscal 2021 and Fiscal 2020, we didn't enter into any related-party
transactions that had a cloth impact on our monetary situation, outcomes of
operations or money flows.

Off-Steadiness-Sheet Preparations
UGI primarily enters into assure preparations on behalf of its consolidated
subsidiaries. These preparations should not topic to the popularity and
measurement steering referring to ensures below GAAP.
We do not need any off-balance-sheet preparations which are anticipated to have a
materials impact on our monetary situation, change in monetary situation,
revenues or bills, outcomes of operations, liquidity, capital expenditures or
capital assets.

Utility Regulatory Issues

Base Price Filings. On February 8, 2021, Electrical Utility filed a charge request
with the PAPUC to extend its annual base distribution revenues by $9 million.
On October 28, 2021, the PAPUC issued a remaining Order approving a settlement that
permitted Electrical Utility, efficient November 9, 2021, to extend its base
distribution revenues by $6 million.

On January 28, 2020, Fuel Utility filed a request with the PAPUC to extend its
annual base distribution working revenues by $75 million yearly. On October
8, 2020, the PAPUC issued a remaining Order approving a settlement that allows Fuel
Utility to extend its annual base distribution charges by $20 million, by a
phased method, with $10 million starting January 1, 2021 and a further
$10 million starting July 1, 2021. Moreover, Fuel Utility was licensed to
implement a DSIC as soon as Fuel Utility complete property, plant and gear much less
collected depreciation reaches $2,875 million. This threshold was achieved in
December 2020, and Fuel Utility applied a DSIC efficient April 1, 2021. The
PAPUC's remaining Order additionally contains enhanced COVID-19 buyer help
measures, together with the institution of an Emergency Reduction Program for a
outlined set of fee troubled clients ("ERP"). Moreover, the PAPUC's
remaining Order permits Fuel Utility to ascertain a regulatory asset for sure
incremental bills attributable to the continued COVID-19 pandemic, most notably
bills associated to the ERP and uncollectible accounts expense, by the
efficient date of charges within the subsequent Fuel Utility base charge case, to be recovered
and amortized over a 10-year interval. In accordance with the phrases of the Joint
Petition, Fuel Utility is just not permitted to file a charge case previous to January 1,
2022.

At January 28, 2019, Fuel Utility has filed a tariff software with PAPUC to extend base working revenues for residential, industrial and industrial clients throughout its Pennsylvania service territory by an combination $ 71 million. At October 4, 2019, PAPUC issued a remaining order approving a settlement that allowed the gasoline firm, as of October 11, 2019, to enhance

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its base distribution revenues by $30 million below a single consolidated
tariff, authorized a plan for uniform class charges, and permitted Fuel Utility to
prolong its Power Effectivity and Conservation and Progress Extension Tariff
applications by a further time period of 5 years. The PAPUC's remaining Order authorized a
unfavourable surcharge, to return to clients $24 million of tax advantages
skilled by Fuel Utility over the interval January 1, 2018 to June 30, 2018,
plus relevant curiosity, in accordance with the Might 17, 2018 PAPUC Order, which
turned efficient for a twelve-month interval starting on October 11, 2019, the
efficient date of Fuel Utility's new base charges, topic to remaining reconciliation
of any over- or under-crediting of the tax financial savings.

Disclosure of market dangers

Our main market threat exposures are (1) commodity value threat; (2) curiosity
charge threat; and (3) overseas forex change charge threat. Though we use
spinoff monetary and commodity devices to scale back market value threat
related to forecasted transactions, we don't use spinoff monetary and
commodity devices for speculative or buying and selling functions.
Commodity Value Threat
The danger related to fluctuations within the costs the Partnership and our UGI
Worldwide operations pay for LPG is principally a results of market forces
reflecting modifications in provide and demand for LPG and different power commodities.
Their profitability is delicate to modifications in LPG provide prices. Will increase in
provide prices are typically handed on to clients. The Partnership and UGI
Worldwide might not, nonetheless, at all times be capable to go by product value
will increase totally or on a well timed foundation, significantly when product prices rise
quickly. As a way to scale back the volatility of LPG market value threat, the
Partnership makes use of contracts for the ahead buy or sale of propane, propane
fixed-price provide agreements and over-the-counter spinoff commodity
devices together with value swap contracts. Our UGI Worldwide operations use
over-the-counter spinoff commodity devices and should every so often
enter into different spinoff contracts, much like these utilized by the Partnership,
to scale back market threat related to a portion of their LPG purchases.
Over-the-counter spinoff commodity devices used to economically hedge
forecasted purchases of LPG are typically settled at expiration of the contract.

UGI Utilities' tariffs comprise clauses that let restoration of all prudently
incurred prices of pure gasoline it sells to its retail core-market clients,
together with the price of monetary devices used to hedge bought gasoline prices.
The restoration clauses present for periodic changes for the distinction between
the entire quantities really billed to clients by PGC and PGA charges and the
recoverable prices incurred. Due to this ratemaking mechanism, there may be
restricted commodity value threat related to our UGI Utilities operations. Fuel
Utility makes use of spinoff monetary devices, together with pure gasoline futures and
possibility contracts traded on the NYMEX, to scale back volatility in the price of gasoline it
purchases for its retail core-market clients. The price of these spinoff
monetary devices, web of any related positive factors or losses, is included in Fuel
Utility's PGC restoration mechanism.

As a way to handle market value threat referring to considerably all of
Midstream & Advertising's fixed-price sale contracts for bodily pure gasoline and
electrical energy, Midstream & Advertising enters into NYMEX, ICE and over-the-counter
pure gasoline and electrical energy futures and possibility contracts, and pure gasoline foundation
swap contracts or enters into fixed-price provide preparations. Midstream &
Advertising additionally makes use of NYMEX and over-the-counter electrical energy futures contracts to
economically hedge a portion of its anticipated gross sales of electrical energy from its
electrical energy technology services. Though Midstream & Advertising's fixed-price
provide preparations mitigate most dangers related to its fixed-price gross sales
contracts, ought to any of the suppliers below these preparations fail to carry out,
will increase, if any, in the price of substitute pure gasoline or electrical energy would
adversely affect Midstream & Advertising's outcomes. As a way to scale back this threat
of provider nonperformance, Midstream & Advertising has diversified its purchases
throughout quite a lot of suppliers. UGI Worldwide's pure gasoline and electrical energy
advertising companies additionally use pure gasoline and electrical energy futures and ahead
contracts to economically hedge market threat related to fixed-price gross sales
and buy contracts.

Midstream & Advertising has entered into fixed-price gross sales agreements for a
portion of the electrical energy anticipated to be generated by its electrical technology
belongings. Within the occasion that these technology belongings wouldn't be capable to produce
the entire electrical energy wanted to provide electrical energy below these agreements,
Midstream & Advertising can be required to buy electrical energy on the spot
market or below contract with different electrical energy suppliers. Accordingly,
will increase in the price of substitute energy may negatively affect Midstream &
Advertising's outcomes.

Curiosity Price Threat
Now we have each fixed-rate and variable-rate debt. Adjustments in rates of interest affect
the money flows of variable-rate debt however typically don't affect their honest
worth. Conversely, modifications in rates of interest affect the honest worth of fixed-rate
debt however don't affect their money flows.

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Our variable-rate debt at September 30, 2021, contains revolving credit score facility
borrowings and variable-rate time period loans at UGI Worldwide, UGI Utilities,
Inc., Power Companies and UGI Company. These debt agreements have curiosity
charges which are typically listed to short-term market rates of interest. Now we have
entered into pay-fixed, receive-variable rate of interest swap agreements on all or
a good portion of the time period loans' principal balances and all or a
good portion of the time period loans' tenor. Now we have designated these curiosity
charge swaps as money stream hedges. At September 30, 2021, mixed borrowings
excellent below variable-rate debt agreements, excluding the beforehand
talked about successfully fixed-rate debt, totaled $807 million. Primarily based upon common
borrowings excellent below variable-rate borrowings (excluding successfully
fixed-rate time period mortgage debt), a rise in short-term rates of interest of 100
foundation factors (1%) would have elevated our Fiscal 2021 curiosity expense by
roughly $7 million. The rest of our debt excellent is topic to
fastened charges of curiosity. A 100 foundation level improve in market rates of interest
would end in decreases within the honest worth of this fixed-rate debt of
roughly $292 million at September 30, 2021. A 100 foundation level lower in
market rates of interest would end in will increase within the honest worth of this
fixed-rate debt of roughly $249 million at September 30, 2021.

Lengthy-term debt related to our home companies is usually issued at
fastened charges of curiosity primarily based upon market charges for debt with comparable phrases and
credit score scores. As these long-term debt points mature, we might refinance such
debt with new debt having rates of interest reflecting then-current market
circumstances. As a way to scale back rate of interest threat related to near- to
medium-term forecasted issuances of fastened charge debt, every so often we enter
into IRPAs.

International Forex Trade Price Threat
Our main forex change charge threat is related to the U.S. greenback
versus the euro and, to a lesser extent, the U.S. greenback versus the British
pound sterling. The U.S. greenback worth of our overseas forex denominated belongings
and liabilities will fluctuate with modifications within the related overseas forex
change charges. Every now and then, we use spinoff devices to hedge
parts of our web investments in overseas subsidiaries. Features or losses on
these web funding hedges stay in AOCI till such overseas operations are
offered or liquidated. With respect to our web investments in our UGI Worldwide
operations, a ten% decline within the worth of the related foreign currency echange
versus the U.S. greenback would scale back their combination web ebook worth at
September 30, 2021, by roughly $170 million, which quantity can be
mirrored in different complete earnings. Now we have designated sure
euro-denominated borrowings as web funding hedges.
As a way to scale back the volatility in web earnings related to our overseas
operations, principally because of modifications within the U.S. greenback change charge
between the euro and British pound sterling, we enter into ahead overseas
forex change contracts. We layer in these overseas forex change
contracts over a multi-year interval to finally equal roughly 90% of
anticipated UGI Worldwide overseas forex earnings earlier than earnings taxes.

By-product Instrument Credit score Threat
We're uncovered to threat of loss within the occasion of nonperformance by our spinoff
instrument counterparties. Our spinoff instrument counterparties principally
comprise massive power firms and main U.S. and worldwide monetary
establishments. We preserve credit score insurance policies with regard to our counterparties that
we imagine scale back total credit score threat. These insurance policies embrace evaluating and
monitoring our counterparties' monetary situation, together with their credit score
scores, and getting into into agreements with counterparties that govern credit score
limits or getting into into netting agreements that enable for offsetting
counterparty receivable and payable balances for sure monetary transactions,
as deemed acceptable.
Now we have concentrations of credit score threat related to spinoff devices and
we consider the creditworthiness of our spinoff counterparties on an ongoing
foundation. As of September 30, 2021, the utmost quantity of loss, primarily based upon the
gross honest values of the spinoff devices, we might incur if these
counterparties didn't carry out in line with the phrases of their contracts was
$1,687 million. Basically, a lot of our over-the-counter spinoff devices
and all change contracts name for the posting of collateral by the
counterparty or by the Firm within the types of letters of credit score, parental
ensures or money. At September 30, 2021, we had obtained money collateral from
spinoff instrument counterparties totaling $468 million. As well as, we might
have offsetting spinoff liabilities and sure accounts payable balances
with sure of those counterparties, which additional mitigates the beforehand
talked about most quantity of losses. Sure of the Partnership's spinoff
contracts have credit-risk-related contingent options that will require the
posting of extra collateral within the occasion of a downgrade of the
Partnership's debt ranking. At September 30, 2021, if the credit-risk-related
contingent options had been triggered, the quantity of collateral required to be
posted wouldn't be materials.
The next desk summarizes the honest values of unsettled market threat
delicate spinoff instrument belongings (liabilities) held at September 30, 2021
and modifications of their honest values as a consequence of market dangers. Sure of UGI Utilities'
commodity spinoff devices are excluded from the desk under as a result of any
related web positive factors or losses are refundable to or recoverable from clients
in accordance with UGI Utilities ratemaking.
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                                                     Asset (Legal responsibility)
                                                                   Change in
(Thousands and thousands of {dollars})                           Truthful Worth        Truthful Worth
September 30, 2021
Commodity value threat (1)                     $    1,334          $      (279)
Rate of interest threat (2)                       $      (29)         $       (10)

Forex threat (3) $ 30 ($ 50)


(1)Change in honest worth represents a ten% adversarial change available in the market costs of
sure commodities
(2)Change in honest worth represents a 50 foundation level adversarial change in prevailing
market rates of interest
(3)Change in honest worth represents a ten% adversarial change within the worth of the Euro
and the British pound sterling versus the U.S. greenback.

Vital Accounting Insurance policies and Estimates
The accounting insurance policies and estimates mentioned on this part are those who
we take into account to be probably the most crucial to an understanding of our monetary
statements as a result of they contain vital judgments and uncertainties. The
software of those accounting insurance policies and estimates essentially requires
administration's most subjective or advanced judgments concerning estimates and
projected outcomes of future occasions. Adjustments in these insurance policies and estimates
may have a cloth impact on our monetary statements. Administration has
reviewed these crucial accounting insurance policies, and the estimates and assumptions
related to them, with the Firm's Audit Committee. Additionally, see Observe 2 to
Consolidated Monetary Statements which discusses our vital accounting
insurance policies.
Goodwill Impairment Analysis. Our goodwill is the results of enterprise
acquisitions. We don't amortize goodwill, however take a look at it a minimum of yearly for
impairment on the reporting unit degree. A reporting unit is an working
phase, or one degree under an working phase (a element), if it
constitutes a enterprise for which discrete monetary data is out there and
frequently reviewed by phase administration. Elements are aggregated right into a
single reporting unit if they've comparable financial traits. A reporting
unit with goodwill is required to carry out an impairment take a look at yearly or
each time occasions or circumstances point out that the worth of goodwill could also be
impaired.
For sure of our reporting items with goodwill, we assess qualitative elements
to find out whether or not it's extra seemingly than not that the honest worth of such
reporting unit is lower than its carrying quantity. For our different reporting items
with goodwill, we bypass the qualitative evaluation and carry out the quantitative
evaluation by evaluating the honest values of the reporting items with their
carrying quantities, together with goodwill. We decide honest values typically primarily based
on a weighting of earnings and market approaches. For functions of the earnings
method, honest values are decided primarily based upon the current worth of the
reporting unit's estimated future money flows, together with an estimate of the
reporting unit's terminal worth primarily based upon these money flows, discounted at
acceptable risk-adjusted charges. We use our inside forecasts to estimate
future money flows, which can embrace estimates of long-term future development charges
primarily based upon our most up-to-date opinions of the long-term outlook for every reporting
unit. Money stream estimates used to ascertain honest values below our earnings
method contain administration judgments primarily based on a broad vary of knowledge and
historic outcomes. As well as, exterior financial and aggressive circumstances
can affect future efficiency. For functions of the market method, we use
valuation multiples for firms corresponding to our reporting items. The market
method requires judgment to find out the suitable valuation multiples. If
the carrying quantity of a reporting unit exceeds its honest worth, an impairment
loss is acknowledged in an quantity equal to such extra however to not exceed the entire
quantity of the goodwill of the reporting unit. As of September 30, 2021, our
goodwill totaled $3,770 million. No impairments of goodwill had been recorded throughout
any of the durations introduced.
Impairment of Lengthy-Lived Belongings. An impairment take a look at for long-lived belongings (or an
asset group) is required when circumstances point out that such belongings could also be
impaired. Whether it is decided {that a} triggering occasion has occurred, we carry out a
recoverability take a look at primarily based upon estimated undiscounted money stream projections
anticipated to be realized over the remaining helpful lifetime of the long-lived asset.
If the undiscounted money flows used within the recoverability take a look at are lower than the
long-lived asset's carrying quantity, we decide its honest worth. If the honest
worth is set to be lower than its carrying quantity, the long-lived asset is
decreased to its estimated honest worth and an impairment loss is acknowledged in an
quantity equal to such shortfall. When figuring out whether or not a long-lived asset has
been impaired, administration teams belongings on the lowest degree that has
identifiable money flows. Performing an impairment take a look at on long-lived belongings
includes judgment in areas equivalent to figuring out when a triggering occasion requiring
analysis happens; figuring out and grouping belongings; and, if the undiscounted
money flows used within the recoverability take a look at are lower than the long-lived asset's
carrying quantity, figuring out the honest worth of the long-lived asset. Though
money stream estimates are primarily based upon related data on the time the
estimates are made, estimates of future money flows are by nature extremely
unsure and ponder elements that change over time such because the anticipated use
of the asset together with future manufacturing and gross sales volumes, anticipated
fluctuations in costs of commodities and anticipated proceeds from
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disposition. See Observe 5 to Consolidated Monetary Statements for data on
the impairment loss related to the disposal of Conemaugh throughout the third
quarter of Fiscal 2020. No different materials provisions for impairments of
long-lived belongings had been recorded throughout Fiscal 2021 or Fiscal 2020.
Loss Contingencies and Environmental Remediation Liabilities. We're concerned in
litigation that arises within the regular course of enterprise, and we're topic to
threat of loss for common, car and product legal responsibility and staff'
compensation claims for which we receive insurance coverage protection topic to
self-insured retentions or deductibles. We're additionally topic to environmental
legal guidelines and laws supposed to mitigate or take away the consequences of previous
operations and enhance or preserve the standard of the surroundings. These legal guidelines
and laws require the removing or treatment of the impact on the surroundings
of the disposal or launch of sure specified hazardous substances at present
or former working websites.
We set up reserves for loss contingencies together with pending litigation, and
for pending and incurred however not reported claims related to common and
product legal responsibility, car and staff' compensation when it's possible that
a legal responsibility exists and the quantity or vary of quantities associated to such legal responsibility
could be moderately estimated. When no quantity inside a variety of attainable loss is a
higher estimate than every other quantity inside the vary, liabilities recorded are
primarily based upon the low finish of the vary. With respect to unasserted claims arising
from unreported incidents, we might use the work of specialists to estimate the
final losses to be incurred utilizing actuarially decided loss improvement
elements utilized to precise claims knowledge.
The chance of a loss with respect to a selected loss contingency is commonly
tough to foretell. As well as, an inexpensive estimate of the loss, or a variety
of attainable loss, will not be practicable primarily based upon the data out there
and the potential results of future occasions and selections by third events that
will decide the last word decision of the loss contingency. Cheap
estimates contain administration judgments primarily based on a broad vary of knowledge and
prior expertise. For litigation and pending claims together with these lined by
insurance coverage insurance policies, the evaluation of possible loss is carried out on a case by case
foundation and contains an analysis of the character of the declare, the procedural
standing of the matter, the likelihood or chance of success in prosecuting or
defending the declare, the data out there with respect to the declare, the
opinions and views of out of doors counsel and different advisors, and previous expertise in
comparable issues. These judgments are reviewed quarterly as extra data is
obtained, and the quantities reserved are up to date as needed. Our estimated
reserves for loss contingencies and for pending and incurred however not reported
claims related to common and product legal responsibility, car and staff'
compensation might differ materially from the last word legal responsibility and such reserves
might change materially as extra data turns into out there and estimated
reserves are adjusted.
We accrue reserves for environmental remediation when assessments point out that
it's possible a legal responsibility has been incurred and an quantity could be moderately
estimated. Quantities recorded as environmental liabilities on the Consolidated
Steadiness Sheets signify our greatest estimate of prices anticipated to be incurred or,
if no finest estimate could be made, the minimal legal responsibility related to a variety
of anticipated environmental investigation and remediation prices. These estimates
are primarily based upon quite a lot of elements together with whether or not the corporate shall be
accountable for such remediation, the scope and value of the remediation work to
be carried out, the portion of prices that shall be shared with different doubtlessly
accountable events, the timing of the remediation and attainable affect of
modifications in expertise, and the laws and necessities of native
governmental authorities. Our estimated reserves for environmental remediation
might differ materially from the last word legal responsibility and such reserves might change
materially as extra data turns into out there and estimated reserves are
adjusted. Fuel Utility receives ratemaking recognition of environmental
investigation and remediation prices related to its in-state environmental
websites.  This ratemaking recognition balances the collected distinction between
historic prices and charge recoveries with an estimate of future prices related
with the websites.
Regulatory Belongings and Liabilities. The accounting for our charge regulated gasoline and
electrical utility companies differs from the accounting for nonregulated
operations in that these companies are required to replicate the consequences of charge
regulation within the consolidated monetary statements. Regulatory practices that
assign prices to accounting durations might differ from accounting strategies typically
utilized by nonregulated companies. When it's possible that regulators will
allow the restoration of present prices by future charges charged to clients,
these prices that in any other case can be expensed by nonregulated firms are
deferred as regulatory belongings. Equally, regulatory liabilities are acknowledged
when it's possible that regulators would require buyer refunds by future
charges or when income is collected from clients for expenditures which have but
to be incurred. We frequently assess whether or not the regulatory belongings are possible
of future restoration by evaluating the regulatory surroundings, current charge orders
and public statements issued by the PAPUC, WVPSC and MDPSC, discussions with
regulatory authorities and authorized counsel. If future restoration of regulatory
belongings ceases to be possible, the elimination of these regulatory belongings would
adversely affect our outcomes of operations and money flows. As of September 30,
2021, our regulatory belongings and regulatory liabilities totaled $397 million and
$388 million, respectively. For added data on regulatory belongings and
liabilities, see Notes 2 and 9 to Consolidated Monetary Statements.
Earnings Taxes. We use the asset and legal responsibility technique of accounting for earnings
taxes. Below this technique, earnings tax expense is acknowledged for the quantity of
taxes payable or refundable for the present yr and for deferred tax
liabilities and belongings for the
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future tax penalties of occasions which have been acknowledged in our monetary
statements or tax returns. Positions taken by an entity in its tax returns should
fulfill a more-likely-than-not recognition threshold assuming the positions will
be examined by tax authorities with full information of related data. We
use assumptions, judgments and estimates to find out our present provision for
earnings taxes. We additionally use assumptions, judgments and estimates to find out our
deferred tax belongings and liabilities and any valuation allowance to be recorded
towards a deferred tax asset. The interpretation of tax legal guidelines includes
uncertainty since tax authorities might interpret the legal guidelines otherwise. Our
assumptions, judgments and estimates relative to the present provision for
earnings tax give consideration to present tax legal guidelines, our interpretation of present
tax legal guidelines and attainable outcomes of present and future audits performed by overseas
and home tax authorities. Adjustments in tax legislation or our interpretation thereof
and the decision of present and future tax audits may considerably affect
the quantities offered for earnings taxes in our consolidated monetary statements.
Our assumptions, judgments and estimates relative to the quantity of deferred
earnings taxes bear in mind estimates of the quantity of future taxable earnings.
Precise taxable earnings or future estimates of taxable earnings may render our
present assumptions, judgments and estimates inaccurate. Adjustments within the
assumptions, judgments and estimates talked about above may trigger our precise
earnings tax obligations to vary considerably from our estimates. As of
September 30, 2021, our web deferred tax liabilities totaled $1,082 million.
Enterprise Mixture Buy Value Allocations. Every now and then, the Firm
enters into materials enterprise combos. The acquisition value is allotted to
the varied belongings acquired and liabilities assumed at their estimated honest
worth as of the acquisition date with the residual of the acquisition value
allotted to goodwill. Every now and then, we have interaction third-party valuation
consultants to help us in figuring out the honest values of sure belongings acquired
and liabilities assumed. Such valuations require administration to make vital
judgments, estimates and assumptions particularly with respect to intangible
belongings. Administration makes estimates of honest worth primarily based upon assumptions it
believes to be affordable. These estimates are primarily based upon historic expertise
and data obtained from the administration of the acquired firms and are
inherently unsure. Vital estimates in valuing sure of the intangible
belongings embrace, however should not restricted to, low cost charges and anticipated future money
flows from and the financial lives of buyer relationships, commerce names,
present expertise, and different intangible belongings. Unanticipated occasions and
circumstances might happen, which can have an effect on the accuracy or validity of such
assumptions or estimates. The allocation of the acquisition value could also be modified
as much as one yr after the acquisition date, below sure circumstances, as extra
data is obtained concerning the honest worth of belongings acquired and liabilities
assumed.

Lately Issued Accounting Pronouncements
See Observe 3 to Consolidated Monetary Statements for a dialogue of the consequences
of just lately issued accounting steering.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
"Quantitative and Qualitative Disclosures About Market Threat" are contained in
Merchandise 7 - Administration's Dialogue and Evaluation of Monetary Situation and Outcomes
of Operations below the caption "Market Threat Disclosures" and are included
by reference.

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