Defined Benefit Pension and Other Postretirement Plans

3 Months Ended

Dec. 31, 2019

Retirement Benefits [Abstract]

Defined Benefit Pension and Other Postretirement Plans

Note 11 — Defined Benefit Pension and Other Postretirement Plans

The U.S. Pension Plan is a defined benefit pension plan for employees hired prior to January 1, 2009, of UGI, UGI Utilities, and certain of UGI’s other domestic wholly owned subsidiaries. U.S. Pension Plan benefits are based on years of service, age and employee compensation. We also provide postretirement health care benefits to certain retirees and postretirement life insurance benefits to certain U.S. active and retired employees. In addition, certain UGI International employees in France, Belgium and the Netherlands are covered by defined benefit pension and postretirement plans. Although the disclosures in the tables below include amounts related to the UGI International plans, such amounts are not material.

The service cost component of our pension and other postretirement plans, net of amounts capitalized, is reflected in “Operating and administrative expenses” on the Condensed Consolidated Statements of Income. The non-service cost component, net of amounts capitalized by UGI Utilities as a regulatory asset, are reflected in “Other non-operating (expense) income, net” on the Condensed Consolidated Statements of Income. Net periodic pension cost and other postretirement benefit cost include the following components:

	Pension Benefits						Other Postretirement Benefits
Three Months Ended December 31,	2019			2018			2019			2018
Service cost	$	2.8		$	2.5		$	0.1		$	—
Interest cost	5.8			6.8			0.2			0.2
Expected return on assets	(9.4		)	(9.0		)	(0.2		)	(0.2		)
Amortization of:
Prior service cost (benefit)	0.1			0.1			(0.1		)	(0.1		)
Actuarial loss	3.7			1.9			—			—
Net benefit cost (benefit)	3.0			2.3			—			(0.1		)
Change in associated regulatory liabilities	—			—			(0.3		)	(0.3		)
Net benefit cost (benefit) after change in regulatory liabilities	$	3.0		$	2.3		$	(0.3	)	$	(0.4	)

The U.S. Pension Plan’s assets are held in trust and consist principally of publicly traded, diversified equity and fixed income mutual funds and, to a much lesser extent, UGI Common Stock. It is our general policy to fund amounts for U.S. Pension Plan benefits equal to at least the minimum required contribution set forth in applicable employee benefit laws. During the three months ended December 31, 2019, the Company made cash contributions to the U.S. Pension Plan of $3.2. During the three months ended December 31, 2018, the Company made no cash contributions to the U.S. Pension Plan. The Company expects to make additional cash contributions of approximately $9.5 to the U.S. Pension Plan during the remainder of Fiscal 2020.

UGI Utilities has established a VEBA trust to pay retiree health care and life insurance benefits by depositing into the VEBA the annual amount of postretirement benefits costs, if any, determined under GAAP. There were no required contributions to the VEBA during the three months ended December 31, 2019 and 2018.

We also sponsor unfunded and non-qualified supplemental executive defined benefit retirement plans. Net costs associated with these plans for the three months ended December 31, 2019 and 2018, were not material.