UGI Earnings: Here’s Why Investors are Ambivalent Now

UGI Corp. (NYSE:UGI) delivered a profit and beat Wall Street’s expectations, BUT came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company.

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UGI Corp. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased 27.97% to $1.51 in the quarter versus EPS of $1.18 in the year-earlier quarter.

Revenue: Rose 4.87% to $2.55 billion from the year-earlier quarter.

Actual vs. Wall St. Expectations: UGI Corp. reported adjusted EPS income of $1.51 per share. By that measure, the company beat the mean analyst estimate of $1.44. It missed the average revenue estimate of $2.92 billion.

Quoting Management: John Walsh, president and chief executive officer of UGI, said, “I am pleased to report a significant increase in earnings for the quarter, as a return to more normal winter weather in February and March enabled our businesses to demonstrate their earnings power. AmeriGas’s contribution to earnings increased nearly 49% from the prior-year period, as the business was able to show the benefits of last year’s acquisition of Heritage Propane. At Gas Utility, earnings increased 22% due in large part to colder weather, but also to our ongoing program to convert customers to natural gas from heating oil. Midstream & Marketing results were encouraging as natural gas marketing, electric generation, and winter peaking all saw strong year-over-year growth, resulting in a 47% increase in earnings contribution. International Propane also posted a 7% increase in earnings contribution due to colder weather and the benefits of the Shell LPG acquisition completed last year.”

Key Stats (on next page)…

Revenue increased 25.83% from $2.02 billion in the previous quarter. EPS increased 67.78% from $0.90 in the previous quarter.

Looking Forward: Analysts have a more positive outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has risen from a profit of $0.03 to a profit $0.08. For the current year, the average estimate has moved down from a profit of $2.53 to a profit of $2.48 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)