UGI Corporation distributes, stores, transports, and markets energy products and related services in the United States and internationally. It distributes propane to approximately 1.9 million residential, commercial/industrial, motor fuel, agricultural, and wholesale customers in 50 states through 1,900 propane distribution locations; and sells, installs, and services propane appliances, including heating systems. The company also distributes liquid petroleum gas (LPG) to residential, commercial, industrial, agricultural, resale, and automobile fuel customers for heating, cooking, motor fuel, leisure, construction work, manufacturing, crop and grain drying, power generation, and irrigation activities; and provides logistic, storage, and other services to third-party LPG distributors. In addition, it engages in the retail sale of natural gas, liquid fuels, and electricity to approximately 160,000 residential, commercial, and industrial customers at approximately 44,000 locations. Further, the company distributes natural gas to approximately 626,000 customers in the portions of 44 eastern and central Pennsylvania counties through its distribution system of 12,000 miles of gas mains; and supplies electricity to approximately 62,000 customers in northeastern Pennsylvania through 2,200 miles of lines and 13 substations. Additionally, it operates electric generation facilities, which include coal-fired, landfill gas-fueled, solar-powered, and natural gas-fueled facilities; a natural gas liquefaction, storage, and vaporization facility; propane storage and propane-air mixing stations; and rail transshipment terminals. The company also manages natural gas pipeline and storage contracts; develops, owns, and operates pipelines, gathering infrastructure, and gas storage facilities; and offers heating, ventilation, air conditioning, refrigeration, mechanical, and electrical contracting services. UGI Corporation was founded in 1882 and is based in King of Prussia, Pennsylvania.
Business Analysis of UGI
The Utilities Sector is witnessing a major shakeup, new age business models in the industry are transforming both customers and businesses. Faced with this uncertainity, companies are investing resources to transform their business. An in-depth business analysis is a valuable resource to identify and articulate the need for a business model change. At R&P Research we believe, the starting point for a business analysis is Benchmarking. Business benchmarking can be done at various levels: 1) Industry Benchmarking 2) Peer Benchmarking 3) Disruptors Benchmarking. In this report, we share the snapshot of how UGI compares against the industry on the major performance indicators. This analysis, along with peer group/disruptors benchmarking and revenue model understanding can help identify growth and cost optimization opportunities to maximize the value delivered by UGI to its stakeholders. R&P Research Industry Intelligence Platform provides historical data for last 15 years with an easy to use benchmarking interface for an in-depth comparative business analysis.
Here is the performance snapshot of UGI with an interactive chart.
- Revenue Growth: UGI reported a revenue growth of -15.0% year-on-year during 2016. Gas, Water, & Multiutilities Industry grew at -0.4% in the same period
- COGS share of Revenues: As a percentage of revenue, UGI spent 42.9% of its total revenues on COGS. Gas, Water, & Multiutilities industry average (COGS share of revenue) in the same period was 63.9%
- R&D share of Revenues: UGI R&D share of Revenues details are not available because either company does not share the data or we do not have it
- SG&A share of Revenues: As a percentage of revenue, UGI spent 32.8% of its total revenues on Sales, Marketing, and General Administration (SG&A). Gas, Water, & Multiutilities industry average SG&A spending in the same period was 2.8%
- Inventory share of Revenues: As a percentage of revenue, UGI spent 3.7% of its total revenues on Inventories. Gas, Water, & Multiutilities industry average Inventory spending in the same period was 7.3%
- Accounts Payable share of Revenues: As a percentage of revenue, UGI invested 6.9% of its total revenues on Accounts Payable (A/P) Gas, Water, & Multiutilities industry average Accounts Payable investment in the same period was 11.4%
- Accounts Receivable share of Revenues: As a percentage of revenue, UGI invested 9.9% of its total revenues on Accounts Receivable (A/R). Gas, Water, & Multiutilities industry average Accounts Receivable investment in the same period was 15.4%
- PP&E share of Revenues: As a percentage of revenue, UGI invested 92.1% of its total revenues on Property, Plants, and Equipments (PP&E). Gas, Water, & Multiutilities industry average PPE investment in the same period was 281.2%
- Intangibles share of Revenues: As a percentage of revenue, UGI invested 62.8% of its total revenues on Intangibles. Gas, Water, & Multiutilities industry average Intangibles investment in the same period was 23.2%
- Net Margins: UGI Net Margins in the year 2016 were 6.4%. Gas, Water, & Multiutilities industry average Net Margins in the same period were 8.6%
Sector and Industry Association of UGI
For the purpose of performance benchmarking of a company with a sector or industry average, R&P Research associates every company with one sector and one industry. An industry consists of companies with related/similar business models. A sector comprises of a group of related/similar industries.
UGI is associated with Utilities Sector and Gas, Water, & Multiutilities Industry.
Utilities sector is comprised of the following industries: Electric Utilities; Gas, Water, & Multiutlities. The definitions for each of the industries is as follows:
- Electric Utilities industry includes companies engaged in generation, transmission, and/or distribution of electric energy for sale.
- Gas, Water, & Multiutlities industry includes companies engaged in transmission and/or storage of natural gas for sale and those engaged in distributing water for sale for domestic, commercial, and industrial use. It also includes companies with significant presence in more than one utility.
Industry Ranking of UGI
With $5.7 billion revenues, UGI ranked number 11 of all the companies in the US Gas, Water, & Multiutilities industry. There were a total of 47 public companies in the US Gas, Water, & Multiutilities industry that had revenues greater than $50 million during 2016.
The top-10 companies in the US Gas, Water, & Multiutilities industry by revenues during 2016 were:
Business Model Analysis (BMA) Framework
We use the following framework to assess the business model of a company. Business Model Analysis framework can be used by organizations to articulate growth strategies and identify cost optimization opportunities. Technology and consulting companies can use this framework to identify the value drivers and pain points of their targeted customers. Entrepreneurs can use this framework to understand the language of business and identify promising business opportunities. This framework can be used by any professional aspiring to take up a leadership role to better understand the businesses challenges, articulate growth strategy, and monitor the business improvement requirements for the organization.