UGI Corporation Secures New $300 Million Revolving Loan Facility

UGI Corporation has amended its Credit Agreement to establish a $300 million senior secured revolving loan facility, maturing on August 5, 2026. The facility is intended to finance cash considerations related to the conversion of the 2028 Notes and offers flexible borrowing options with interest rates tied to the company's net leverage ratio. The loans are secured by the company's equity in its Material Subsidiaries, with certain exceptions.

UGI Corporation has amended its Credit Agreement to establish a $300 million senior secured revolving loan facility, maturing on August 5, 2026. This facility is designed to finance cash considerations related to the conversion of the 2028 Notes and offers flexible borrowing options with interest rates tied to the company's net leverage ratio. The loans are secured by the company's equity in its Material Subsidiaries, with certain exceptions [1].

This move follows UGI's strong financial performance in the first three quarters of fiscal 2025. The company reported a record year-to-date adjusted diluted EPS of $3.55, up $0.33 from the prior year. UGI deployed over $600 million in capital, with 80% directed towards high-return businesses. The Utilities segment added approximately 9,000 customers this fiscal year. UGI is also optimizing its LPG portfolio, expecting to generate $150 million in proceeds from asset sales [2].

The company's strategic focus on portfolio optimization and operational efficiency has been highlighted in its third quarter report. CEO Robert C. Flexon attributed the strong performance to contributions from all segments, particularly strategic investments in natural gas infrastructure, operating efficiencies, and customer focus improvements. The company expects to achieve the top end of its fiscal 2025 adjusted EPS guidance range of $3 to $3.15 per share [2].

Financial results for the third quarter showed adjusted diluted EPS of negative $0.01, compared to positive $0.06 in the prior year period. Utilities EBIT for the quarter was $30 million, down from $39 million, with total margin up $4 million due to infrastructure investments, offset by $10 million higher operating and administrative expenses and increased depreciation. Midstream & Marketing EBIT was $27 million, down $16 million, with lower margins from natural gas gathering and processing and the impact of a 2024 asset divestiture, partly offset by gas marketing. UGI International reported EBIT of $43 million versus $57 million, with LPG volumes down 9% and a $19 million decline in margin, partially mitigated by lower operating expenses. AmeriGas posted an operating loss of $28 million, consistent with the prior year; higher retail unit margins offset lower volumes [2].

Management emphasized a disciplined approach to capital allocation and asset optimization, with over $600 million in year-to-date capital deployed. The company is focusing on high-return businesses and divesting non-core operations to enhance customer value and operational efficiency. UGI expects earnings from its underlying businesses, excluding taxes, to be largely consistent with the prior year period for fiscal Q4 [2].

The company is also addressing regulatory and legislative impacts, including the One Big Beautiful Bill Act, which is expected to provide additional tax expense favorability as the company moves forward. Management acknowledged seasonal and segment-specific headwinds but remains confident in its strategic initiatives and operational improvements [2].

References:
[1] https://www.ainvest.com/news/ugi-corp-q3-2025-earnings-call-navigating-challenges-strategic-growth-optimized-capital-deployment-2508/
[2] https://seekingalpha.com/news/4481479-ugi-signals-top-end-eps-guidance-of-3_15-for-fiscal-2025-amid-portfolio-optimization-and