UGI : Consolidated Financial Statements for the quarter ended June 30, 2021

UGI UTILITIES, INC.

AND SUBSIDIARIES

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

for the three and nine months ended June 30, 2021 and 2020

(Unaudited)

UGI UTILITIES, INC. AND SUBSIDIARIES

TABLE OF CONTENTS

	Page
Glossary of Terms and Abbreviations	1
Financial Statements (unaudited)
Condensed Consolidated Balance Sheets as of June 30, 2021, September 30, 2020, and June 30, 2020	3
Condensed Consolidated Statements of Income for the three and nine months ended June 30, 2021 and 2020	4
Condensed Consolidated Statements of Comprehensive Income for the three and nine months ended June 30, 2021	5
and 2020
Condensed Consolidated Statements of Cash Flows for the nine months ended June 30, 2021 and 2020	6
Condensed Consolidated Statements of Stockholder's Equity for the nine months ended June 30, 2021 and 2020	7
Notes to Condensed Consolidated Financial Statements	8

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UGI UTILITIES, INC. AND SUBSIDIARIES

GLOSSARY OF TERMS AND ABBREVIATIONS

Terms and abbreviations used in this document are defined below:

UGI Utilities, Inc. and Related Entities

Company - UGI Utilities or collectively UGI Utilities and its subsidiaries

Electric Utility - UGI Utilities' regulated electric distribution utility

Energy Services - UGI Energy Services, LLC, a wholly-owned second tier subsidiary of UGI and affiliate of UGI Utilities

Gas Utility - UGI Utilities' regulated natural gas distribution business, comprising the natural gas utility businesses owned and operated by UGI Utilities

UGI - UGI Corporation, parent company of UGI Utilities

UGI Utilities - UGI Utilities, Inc., a wholly-owned subsidiary of UGI

Other Terms and Abbreviations

1.59% Senior Note - A private placement of $100 million principal amount of senior notes due June 2026, issued by UGI Utilities

1.64% Senior Note - A private placement of $75 million principal amount of senior notes due September 2026, to be issued by UGI Utilities in September 2021

2020 Annual Report - UGI Utilities Annual Report for the fiscal year ended September 30, 2020

AOCI - Accumulated Other Comprehensive Income (Loss)

ASC - Accounting Standards Codification

ASC 606 - ASC 606, "Revenue from Contracts with Customers"

ASU - Accounting Standards Update

Bcf - Billions of cubic feet

CDC - Centers for Disease Control and Prevention

COA - Consent Order and Agreement

Core market - Comprises (1) firm residential, commercial and industrial customers to whom UGI Utilities has a statutory obligation to provide service who purchase their natural gas or electricity from UGI Utilities; and (2) residential, commercial and industrial customers to whom UGI Utilities has a statutory obligation to provide service who purchase their natural gas or electricity from others

COVID-19 - A novel strain of coronavirus disease discovered in 2019

DS - Default service

DSIC - Distribution System Improvement Charge

FASB - Financial Accounting Standards Board

FERC - Federal Energy Regulatory Commission

Fiscal 2021 - The fiscal year ending September 30, 2021

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UGI UTILITIES, INC. AND SUBSIDIARIES

Fiscal 2022 - The fiscal year ending September 30, 2022

GAAP - U.S. generally accepted accounting principles

IRPA - Interest rate protection agreement

MDPSC - Maryland Public Service Commission

MGP - Manufactured gas plant

NPNS - Normal purchase and normal sale

NYMEX - New York Mercantile Exchange

PADEP - Pennsylvania Department of Environmental Protection

PAPUC - Pennsylvania Public Utility Commission

PGC - Purchased gas costs

Retail core-market- Comprises firm residential, commercial and industrial customers to whom UGI Utilities has a statutory obligation to provide service that purchase their natural gas from Gas Utility

SCAA - Storage contract administrative agreement

Temporary Rates Order - Order issued by the PAPUC on March 15, 2018, that converted PAPUC approved rates of a defined group of large Pennsylvania public utilities into temporary rates for a period of not more than 12 months while the PAPUC reviewed effects of the Tax Cuts and Jobs Act

USD - U.S. dollar

WHO - World Health Organization

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UGI UTILITIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(unaudited)
(Millions of dollars)
		June 30,	September 30,			June 30,
		2021			2020			2020
ASSETS
Current assets:
Cash and cash equivalents	$	2		$	5	$	2
Restricted cash		-		-			3
Accounts receivable (less allowances for doubtful accounts of $20, $15		110			78			101
and $17, respectively)
Accrued utility revenues		8			14			14
Inventories		35			39			29
Prepaid expenses and other current assets		29			28			16
Total current assets		184			164			165
Property, plant and equipment (less accumulated depreciation of $1,273,		3,226			3,055			2,951
$1,210 and $1,190, respectively)
Goodwill		182			182			182
Regulatory assets		389			395			395
Other assets		16			13			15
Total assets	$	3,997		$	3,809	$	3,708
LIABILITIES AND STOCKHOLDER'S EQUITY
Current liabilities:
Current maturities of long-term debt	$	7		$	8	$	8
Short-term borrowings		100			141			40
Accounts payable		76			92			55
Regulatory liabilities		24			38			40
Other current liabilities		140			112			120
Total current liabilities		347			391			263
Long-term debt		1,207			1,113			1,114
Deferred income taxes		497			462			467
Pension and postretirement benefit obligations		163			170			162
Regulatory liabilities		310			315			318
Other noncurrent liabilities		66			77			79
Total liabilities		2,590			2,528			2,403
Commitments and contingencies (Note 7)
Common stockholder's equity:
Common Stock		60			60			60
Additional paid-in capital		474			474			474
Retained earnings		902			780			804
Accumulated other comprehensive loss		(29)			(33)			(33)
Total common stockholder's equity		1,407			1,281			1,305
Total liabilities and stockholder's equity	$	3,997		$	3,809	$	3,708

See accompanying notes to condensed consolidated financial statements.

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