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The Laclede Group Inc. Reports Operating Results (10-K)
Posted by: gurufocus (IP Logged)
Date: November 19, 2012 10:05AM
The Laclede Group Inc. (LG) filed Annual Report for the period ended 2012-09-30. Laclede Group, Inc. has a market cap of $872.3 million; its shares were traded at around $38.69 with a P/E ratio of 14.7 and P/S ratio of 0.5. The dividend yield of Laclede Group, Inc. stocks is 4.3%. Laclede Group, Inc. had an annual average earning growth of 4.2% over the past 10 years.
Highlight of Business Operations:Basic and diluted earnings per share were $2.80 and $2.79, respectively for fiscal year 2012 compared with basic and diluted earnings per share of $2.87 and $2.86, respectively, for fiscal year 2011, and $2.43 for fiscal year 2010. Net economic earnings per share were $2.79 in both fiscal years 2012 and 2011 and $2.52 in fiscal year 2010. The year-to-year variations in earnings per share and net economic earnings per share were primarily due to the changes in net income and net economic earnings, respectively, in each period.
Other net income and Other net economic earnings decreased by $4.4 million and $4.3 million, respectively, compared with 2011. The decrease was primarily due to the effect of Laclede Gas April 2011 sale of 320,000 barrels of propane from inventory that were no longer required to serve utility customers. This transaction resulted in income, net of income taxes, totaling $6.1 million.
Other Operating Revenues decreased $16.9 million in fiscal year 2012 (compared to fiscal year 2011) and increased $8.8 million in fiscal year 2011 (compared to fiscal year 2010). Other Operating Expenses decreased $7.1 million in fiscal year 2012 (compared to fiscal year 2011) and increased $4.3 million in fiscal year 2011 (compared to fiscal year 2010). These year-to-year variations were primarily attributable to non-regulated sales of propane inventory in fiscal years 2011 and 2010. These transactions resulted in pre-tax income of $10.0 million in fiscal year 2011 and $6.0 million in fiscal year 2010. This type of transaction did not recur in fiscal year 2012.
Net cash provided by operating activities for fiscal years 2012, 2011 and 2010 was $128.1 million, $167.2 million and $106.9 million, respectively. The decrease in net cash provided by operating activities in fiscal year 2012 (compared to fiscal year 2011) is primarily attributable to variations associated with the timing of collections of gas cost under the Utility s PGA Clause, including the net effect of increased cash payments for margin deposits associated with the Utility s use of natural gas derivative instruments and changes in the cost of natural gas storage inventories. The decrease is also attributable to the effect of a non-regulated sale of propane inventory in fiscal year 2011 and increased cash payments for the funding of pension plans this year. The improvement in net cash provided by operating activities in fiscal year 2011 (compared to fiscal year 2010) is primarily attributable to reduced cash payments for margin deposits associated with the Utility s use of natural gas derivative instruments and other variations in the timing of the collection of gas costs under the PGA Clause, as well as improved operating earnings of the Utility. These factors were partially offset by a reduction in operating cash flows at LER and higher net cash payments for income taxes.
Laclede Group had temporary cash investments totaling $23.3 million at September 30, 2012, earning an average interest rate of 0.2% compared to $19.8 million earning an average interest rate of 0.2% at September 30, 2011. These investments, which are presented in the Cash and cash equivalents line of the Consolidated Balance Sheets, were diversified among money market funds and interest-bearing deposits at highly-rated commercial banks. The money market funds are accessible by the Company on demand. The bank deposits are also generally available on demand, though the banks reserve the right to require seven days notice for a withdrawal. These funds are used to support the working capital needs of the Company s subsidiaries. The balance of short-term investments ranged between $5.3 million and $23.3 million during fiscal year 2012 and ranged between $13.3 million and $85.8 million during fiscal year 2011. Due to lower yields available to Laclede Group on its short-term investments, Laclede Group elected to provide a portion of Laclede Gas short-term funding through intercompany lending during fiscal years 2012 and 2011.
Stocks Discussed: LG,