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Leases | 12 Months Ended
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Sep. 30, 2025
Leases [Abstract] |
Leases | Note 15 — Leases Lessee We lease various buildings and other facilities, real estate, vehicles, rail cars and other equipment, the majority of which are operating leases. We determine if a contract is or contains a lease by evaluating whether the contract explicitly or implicitly identifies an asset, whether we have the right to obtain substantially all of the economic benefits of the identified leased asset and to direct its use. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. We recognize ROU assets at the lease commencement date at the value of the lease liability adjusted for any prepayments, lease incentives received, and initial direct costs incurred. Lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. These payments are discounted using the discount rate implicit in the lease, when available. We apply an incremental borrowing rate, which is developed utilizing a credit notching approach based on information available at the lease commencement date, when the implicit rate is not available. Lease expense is recognized on a straight-line basis over the expected lease term. Renewal and termination options are not included in the lease term unless we are reasonably certain that such options will be exercised. Leases with an original lease term of one year or less, including consideration of any renewal options assumed to be exercised, are not included in the Consolidated Balance Sheets. Certain lease arrangements, primarily fleet vehicle leases with lease terms of one to ten years, contain purchase options. The Company generally excludes purchase options in evaluating its leases unless it is reasonably certain that such options will be exercised. Additionally, leases of fleet vehicles often contain residual value guarantees that are due at the end of the lease. Such amounts are included in the determination of lease liabilities when we are reasonably certain that they will be owed. Certain leasing arrangements require variable payments that are dependent on asset usage or are based on changes in index rates, such as the Consumer Price Index. The variable payments component of such leases cannot be determined at lease commencement and is not recognized in the measurement of ROU assets or lease liabilities, but is recognized in earnings in the period in which the obligation occurs. Sale-leaseback transaction. During the fourth quarter of Fiscal 2023, AmeriGas OLP completed a sale-leaseback transaction with an independent third party for the land, building and improvements of an office and service center located in Gardena, California. The office and service center was leased back to AmeriGas OLP under an operating lease agreement having an initial six-year term with an option to renew. In conjunction with the transaction, AmeriGas OLP received approximately $32 in cash proceeds which resulted in a pre-tax gain of $29, reflected in “Other operating expense (income), net” on the Fiscal 2023 Consolidated Statement of Income. ROU assets and lease liabilities recorded in the Consolidated Balance Sheets as of September 30 are as follows:
| 2025 |  | 2024 |  | Location on the Balance Sheet
ROU assets: |  |  |  |  |
Operating lease ROU assets | $ | 416 |  |  | $ | 417 |  |  | Other assets
Finance lease ROU assets | 52 |  |  | 54 |  |  | Property, plant and equipment
Total ROU assets | $ | 468 |  |  | $ | 471 |  |  |
Lease liabilities: |  |  |  |  |
Operating lease liabilities — current | $ | 91 |  |  | $ | 86 |  |  | Other current liabilities
Operating lease liabilities — noncurrent | 336 |  |  | 343 |  |  | Other noncurrent liabilities
Finance lease liabilities — current | 3 |  |  | 3 |  |  | Current maturities of long-term debt
Finance lease liabilities — noncurrent | 52 |  |  | 52 |  |  | Long-term debt
Total lease liabilities | $ | 482 |  |  | $ | 484 |  |  |
The components of lease cost for Fiscal 2025, Fiscal 2024 and Fiscal 2023 are as follows:
| 2025 |  | 2024 |  | 2023
Operating lease cost | $ | 121 |  |  | $ | 111 |  |  | $ | 104 |
Finance lease cost: |  |  |  |  |
Amortization of ROU assets | 5 |  |  | 4 |  |  | 3 |
Interest on lease liabilities | 3 |  |  | 3 |  |  | 3 |
Variable lease cost | — |  |  | 1 |  |  | 2 |
Short-term lease cost | 6 |  |  | 10 |  |  | 4 |
Total lease cost | $ | 135 |  |  | $ | 129 |  |  | $ | 116 |
The following table presents the cash and non-cash activity related to lease liabilities included in the Consolidated Statements of Cash Flows during Fiscal 2025, Fiscal 2024 and Fiscal 2023:
| 2025 |  | 2024 |  | 2023
Cash paid related to lease liabilities: |  |  |  |  |
Operating cash flows — operating leases | $ | 119 |  |  | $ | 109 |  |  | $ | 103 |
Operating cash flows — finance leases | $ | 3 |  |  | $ | 4 |  |  | $ | 3 |
Financing cash flows — finance leases | $ | 3 |  |  | $ | 2 |  |  | $ | 1 |
Non-cash lease liability activities: |  |  |  |  |
ROU assets obtained in exchange for operating lease liabilities | $ | 40 |  |  | $ | 84 |  |  | $ | 136 |
ROU assets obtained in exchange for finance lease liabilities | $ | 2 |  |  | $ | 7 |  |  | $ | 6 |
The following table presents the weighted-average remaining lease term and weighted-average discount rate:
Weighted-average remaining lease term (in years) |  | 2025 |  | 2024
Operating leases |  | 6.3 |  | 6.8
Finance leases |  | 6.3 |  | 6.7
Weighted-average discount rate (%) |  | 2025 |  | 2024
Operating leases |  | 7.5% |  | 4.8%
Finance leases |  | 6.5% |  | 6.9%
Expected annual lease payments based on maturities of operating and finance leases, as well as a reconciliation to the lease liabilities on the Consolidated Balance Sheet, as of September 30, 2025, were as follows:
| 2026 |  | 2027 |  | 2028 |  | 2029 |  | 2030 |  | After 2030 |  | Total Lease Payments |  | Imputed Interest |  | Lease Liabilities
Operating leases | $ | 112 |  |  | $ | 97 |  |  | $ | 83 |  |  | $ | 70 |  |  | $ | 47 |  |  | $ | 100 |  |  | $ | 509 |  |  | $ | (82) |  |  | $ | 427 |
Finance leases | $ | 7 |  |  | $ | 6 |  |  | $ | 6 |  |  | $ | 5 |  |  | $ | 5 |  |  | $ | 72 |  |  | $ | 101 |  |  | $ | (46) |  |  | $ | 55 |
Approximately 80% of the operating lease liabilities presented above relate to AmeriGas Propane. At September 30, 2025, operating and finance leases that had not yet commenced were not material. Lessor We enter into lessor arrangements for the purposes of storing, gathering or distributing natural gas and LPG. AmeriGas Propane and UGI International have lessor arrangements that grant customers the right to use small, medium and large storage tanks, which we classify as operating leases. These agreements contain renewal options for periods up to nine years and certain agreements at UGI International contain a purchase option. Energy Services leases certain natural gas gathering assets to customers, which we classify as operating leases. Lease income is generally recognized on a straight-line basis over the lease term and included in “Revenues” on the Consolidated Statements of Income. See Note 4 for additional information on these revenues.
Leases | Note 15 — Leases Lessee We lease various buildings and other facilities, real estate, vehicles, rail cars and other equipment, the majority of which are operating leases. We determine if a contract is or contains a lease by evaluating whether the contract explicitly or implicitly identifies an asset, whether we have the right to obtain substantially all of the economic benefits of the identified leased asset and to direct its use. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. We recognize ROU assets at the lease commencement date at the value of the lease liability adjusted for any prepayments, lease incentives received, and initial direct costs incurred. Lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. These payments are discounted using the discount rate implicit in the lease, when available. We apply an incremental borrowing rate, which is developed utilizing a credit notching approach based on information available at the lease commencement date, when the implicit rate is not available. Lease expense is recognized on a straight-line basis over the expected lease term. Renewal and termination options are not included in the lease term unless we are reasonably certain that such options will be exercised. Leases with an original lease term of one year or less, including consideration of any renewal options assumed to be exercised, are not included in the Consolidated Balance Sheets. Certain lease arrangements, primarily fleet vehicle leases with lease terms of one to ten years, contain purchase options. The Company generally excludes purchase options in evaluating its leases unless it is reasonably certain that such options will be exercised. Additionally, leases of fleet vehicles often contain residual value guarantees that are due at the end of the lease. Such amounts are included in the determination of lease liabilities when we are reasonably certain that they will be owed. Certain leasing arrangements require variable payments that are dependent on asset usage or are based on changes in index rates, such as the Consumer Price Index. The variable payments component of such leases cannot be determined at lease commencement and is not recognized in the measurement of ROU assets or lease liabilities, but is recognized in earnings in the period in which the obligation occurs. Sale-leaseback transaction. During the fourth quarter of Fiscal 2023, AmeriGas OLP completed a sale-leaseback transaction with an independent third party for the land, building and improvements of an office and service center located in Gardena, California. The office and service center was leased back to AmeriGas OLP under an operating lease agreement having an initial six-year term with an option to renew. In conjunction with the transaction, AmeriGas OLP received approximately $32 in cash proceeds which resulted in a pre-tax gain of $29, reflected in “Other operating expense (income), net” on the Fiscal 2023 Consolidated Statement of Income. ROU assets and lease liabilities recorded in the Consolidated Balance Sheets as of September 30 are as follows:
| 2025 |  | 2024 |  | Location on the Balance Sheet
ROU assets: |  |  |  |  |
Operating lease ROU assets | $ | 416 |  |  | $ | 417 |  |  | Other assets
Finance lease ROU assets | 52 |  |  | 54 |  |  | Property, plant and equipment
Total ROU assets | $ | 468 |  |  | $ | 471 |  |  |
Lease liabilities: |  |  |  |  |
Operating lease liabilities — current | $ | 91 |  |  | $ | 86 |  |  | Other current liabilities
Operating lease liabilities — noncurrent | 336 |  |  | 343 |  |  | Other noncurrent liabilities
Finance lease liabilities — current | 3 |  |  | 3 |  |  | Current maturities of long-term debt
Finance lease liabilities — noncurrent | 52 |  |  | 52 |  |  | Long-term debt
Total lease liabilities | $ | 482 |  |  | $ | 484 |  |  |
The components of lease cost for Fiscal 2025, Fiscal 2024 and Fiscal 2023 are as follows:
| 2025 |  | 2024 |  | 2023
Operating lease cost | $ | 121 |  |  | $ | 111 |  |  | $ | 104 |
Finance lease cost: |  |  |  |  |
Amortization of ROU assets | 5 |  |  | 4 |  |  | 3 |
Interest on lease liabilities | 3 |  |  | 3 |  |  | 3 |
Variable lease cost | — |  |  | 1 |  |  | 2 |
Short-term lease cost | 6 |  |  | 10 |  |  | 4 |
Total lease cost | $ | 135 |  |  | $ | 129 |  |  | $ | 116 |
The following table presents the cash and non-cash activity related to lease liabilities included in the Consolidated Statements of Cash Flows during Fiscal 2025, Fiscal 2024 and Fiscal 2023:
| 2025 |  | 2024 |  | 2023
Cash paid related to lease liabilities: |  |  |  |  |
Operating cash flows — operating leases | $ | 119 |  |  | $ | 109 |  |  | $ | 103 |
Operating cash flows — finance leases | $ | 3 |  |  | $ | 4 |  |  | $ | 3 |
Financing cash flows — finance leases | $ | 3 |  |  | $ | 2 |  |  | $ | 1 |
Non-cash lease liability activities: |  |  |  |  |
ROU assets obtained in exchange for operating lease liabilities | $ | 40 |  |  | $ | 84 |  |  | $ | 136 |
ROU assets obtained in exchange for finance lease liabilities | $ | 2 |  |  | $ | 7 |  |  | $ | 6 |
The following table presents the weighted-average remaining lease term and weighted-average discount rate:
Weighted-average remaining lease term (in years) |  | 2025 |  | 2024
Operating leases |  | 6.3 |  | 6.8
Finance leases |  | 6.3 |  | 6.7
Weighted-average discount rate (%) |  | 2025 |  | 2024
Operating leases |  | 7.5% |  | 4.8%
Finance leases |  | 6.5% |  | 6.9%
Expected annual lease payments based on maturities of operating and finance leases, as well as a reconciliation to the lease liabilities on the Consolidated Balance Sheet, as of September 30, 2025, were as follows:
| 2026 |  | 2027 |  | 2028 |  | 2029 |  | 2030 |  | After 2030 |  | Total Lease Payments |  | Imputed Interest |  | Lease Liabilities
Operating leases | $ | 112 |  |  | $ | 97 |  |  | $ | 83 |  |  | $ | 70 |  |  | $ | 47 |  |  | $ | 100 |  |  | $ | 509 |  |  | $ | (82) |  |  | $ | 427 |
Finance leases | $ | 7 |  |  | $ | 6 |  |  | $ | 6 |  |  | $ | 5 |  |  | $ | 5 |  |  | $ | 72 |  |  | $ | 101 |  |  | $ | (46) |  |  | $ | 55 |
Approximately 80% of the operating lease liabilities presented above relate to AmeriGas Propane. At September 30, 2025, operating and finance leases that had not yet commenced were not material. Lessor We enter into lessor arrangements for the purposes of storing, gathering or distributing natural gas and LPG. AmeriGas Propane and UGI International have lessor arrangements that grant customers the right to use small, medium and large storage tanks, which we classify as operating leases. These agreements contain renewal options for periods up to nine years and certain agreements at UGI International contain a purchase option. Energy Services leases certain natural gas gathering assets to customers, which we classify as operating leases. Lease income is generally recognized on a straight-line basis over the lease term and included in “Revenues” on the Consolidated Statements of Income. See Note 4 for additional information on these revenues.
Leases | Note 15 — Leases Lessee We lease various buildings and other facilities, real estate, vehicles, rail cars and other equipment, the majority of which are operating leases. We determine if a contract is or contains a lease by evaluating whether the contract explicitly or implicitly identifies an asset, whether we have the right to obtain substantially all of the economic benefits of the identified leased asset and to direct its use. ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. We recognize ROU assets at the lease commencement date at the value of the lease liability adjusted for any prepayments, lease incentives received, and initial direct costs incurred. Lease liabilities are recognized at the lease commencement date based on the present value of lease payments over the lease term. These payments are discounted using the discount rate implicit in the lease, when available. We apply an incremental borrowing rate, which is developed utilizing a credit notching approach based on information available at the lease commencement date, when the implicit rate is not available. Lease expense is recognized on a straight-line basis over the expected lease term. Renewal and termination options are not included in the lease term unless we are reasonably certain that such options will be exercised. Leases with an original lease term of one year or less, including consideration of any renewal options assumed to be exercised, are not included in the Consolidated Balance Sheets. Certain lease arrangements, primarily fleet vehicle leases with lease terms of one to ten years, contain purchase options. The Company generally excludes purchase options in evaluating its leases unless it is reasonably certain that such options will be exercised. Additionally, leases of fleet vehicles often contain residual value guarantees that are due at the end of the lease. Such amounts are included in the determination of lease liabilities when we are reasonably certain that they will be owed. Certain leasing arrangements require variable payments that are dependent on asset usage or are based on changes in index rates, such as the Consumer Price Index. The variable payments component of such leases cannot be determined at lease commencement and is not recognized in the measurement of ROU assets or lease liabilities, but is recognized in earnings in the period in which the obligation occurs. Sale-leaseback transaction. During the fourth quarter of Fiscal 2023, AmeriGas OLP completed a sale-leaseback transaction with an independent third party for the land, building and improvements of an office and service center located in Gardena, California. The office and service center was leased back to AmeriGas OLP under an operating lease agreement having an initial six-year term with an option to renew. In conjunction with the transaction, AmeriGas OLP received approximately $32 in cash proceeds which resulted in a pre-tax gain of $29, reflected in “Other operating expense (income), net” on the Fiscal 2023 Consolidated Statement of Income. ROU assets and lease liabilities recorded in the Consolidated Balance Sheets as of September 30 are as follows:
| 2025 |  | 2024 |  | Location on the Balance Sheet
ROU assets: |  |  |  |  |
Operating lease ROU assets | $ | 416 |  |  | $ | 417 |  |  | Other assets
Finance lease ROU assets | 52 |  |  | 54 |  |  | Property, plant and equipment
Total ROU assets | $ | 468 |  |  | $ | 471 |  |  |
Lease liabilities: |  |  |  |  |
Operating lease liabilities — current | $ | 91 |  |  | $ | 86 |  |  | Other current liabilities
Operating lease liabilities — noncurrent | 336 |  |  | 343 |  |  | Other noncurrent liabilities
Finance lease liabilities — current | 3 |  |  | 3 |  |  | Current maturities of long-term debt
Finance lease liabilities — noncurrent | 52 |  |  | 52 |  |  | Long-term debt
Total lease liabilities | $ | 482 |  |  | $ | 484 |  |  |
The components of lease cost for Fiscal 2025, Fiscal 2024 and Fiscal 2023 are as follows:
| 2025 |  | 2024 |  | 2023
Operating lease cost | $ | 121 |  |  | $ | 111 |  |  | $ | 104 |
Finance lease cost: |  |  |  |  |
Amortization of ROU assets | 5 |  |  | 4 |  |  | 3 |
Interest on lease liabilities | 3 |  |  | 3 |  |  | 3 |
Variable lease cost | — |  |  | 1 |  |  | 2 |
Short-term lease cost | 6 |  |  | 10 |  |  | 4 |
Total lease cost | $ | 135 |  |  | $ | 129 |  |  | $ | 116 |
The following table presents the cash and non-cash activity related to lease liabilities included in the Consolidated Statements of Cash Flows during Fiscal 2025, Fiscal 2024 and Fiscal 2023:
| 2025 |  | 2024 |  | 2023
Cash paid related to lease liabilities: |  |  |  |  |
Operating cash flows — operating leases | $ | 119 |  |  | $ | 109 |  |  | $ | 103 |
Operating cash flows — finance leases | $ | 3 |  |  | $ | 4 |  |  | $ | 3 |
Financing cash flows — finance leases | $ | 3 |  |  | $ | 2 |  |  | $ | 1 |
Non-cash lease liability activities: |  |  |  |  |
ROU assets obtained in exchange for operating lease liabilities | $ | 40 |  |  | $ | 84 |  |  | $ | 136 |
ROU assets obtained in exchange for finance lease liabilities | $ | 2 |  |  | $ | 7 |  |  | $ | 6 |
The following table presents the weighted-average remaining lease term and weighted-average discount rate:
Weighted-average remaining lease term (in years) |  | 2025 |  | 2024
Operating leases |  | 6.3 |  | 6.8
Finance leases |  | 6.3 |  | 6.7
Weighted-average discount rate (%) |  | 2025 |  | 2024
Operating leases |  | 7.5% |  | 4.8%
Finance leases |  | 6.5% |  | 6.9%
Expected annual lease payments based on maturities of operating and finance leases, as well as a reconciliation to the lease liabilities on the Consolidated Balance Sheet, as of September 30, 2025, were as follows:
| 2026 |  | 2027 |  | 2028 |  | 2029 |  | 2030 |  | After 2030 |  | Total Lease Payments |  | Imputed Interest |  | Lease Liabilities
Operating leases | $ | 112 |  |  | $ | 97 |  |  | $ | 83 |  |  | $ | 70 |  |  | $ | 47 |  |  | $ | 100 |  |  | $ | 509 |  |  | $ | (82) |  |  | $ | 427 |
Finance leases | $ | 7 |  |  | $ | 6 |  |  | $ | 6 |  |  | $ | 5 |  |  | $ | 5 |  |  | $ | 72 |  |  | $ | 101 |  |  | $ | (46) |  |  | $ | 55 |
Approximately 80% of the operating lease liabilities presented above relate to AmeriGas Propane. At September 30, 2025, operating and finance leases that had not yet commenced were not material. Lessor We enter into lessor arrangements for the purposes of storing, gathering or distributing natural gas and LPG. AmeriGas Propane and UGI International have lessor arrangements that grant customers the right to use small, medium and large storage tanks, which we classify as operating leases. These agreements contain renewal options for periods up to nine years and certain agreements at UGI International contain a purchase option. Energy Services leases certain natural gas gathering assets to customers, which we classify as operating leases. Lease income is generally recognized on a straight-line basis over the lease term and included in “Revenues” on the Consolidated Statements of Income. See Note 4 for additional information on these revenues.

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