The Laclede Group Inc. (LG, Financial) filed Quarterly Report for the period ended 2008-12-31.
The Laclede Group Inc. is a public utility engaged in the retail distribution and transportation of natural gas. The Company which is subject to the jurisdiction of the Missouri Public Service Commission serves the City of St. Louis St. Louis County the City of St. Charles St. Charles County the town of Arnold and parts of Franklin Jefferson St. Francois Ste. Genevieve Iron Madison and Butler Counties all in Missouri. The Laclede Group Inc. has a market cap of $972.22 million; its shares were traded at around $45.39 with a P/E ratio of 18.1 and P/S ratio of 0.44. The dividend yield of The Laclede Group Inc. stocks is 3.5%. The Laclede Group Inc. had an annual average earning growth of 1.3% over the past 10 years.
Laclede Group s income from continuing operations was $31.3 million for the quarter ended December 31, 2008, compared with $21.5 million for the quarter ended December 31, 2007. Basic and diluted earnings per share from continuing operations were $1.43 and $1.42, respectively, for the quarter ended December 31, 2008, compared with basic and diluted earnings per share of $1.00 for the quarter ended December 31, 2007. Earnings results reported by both Laclede Group s Non-Regulated Gas Marketing segment and its Regulated Gas Distribution segment increased over the quarter ended December 31, 2007. Variations in income from continuing operations were primarily attributable to the factors described below.
Regulated Gas Distribution Operating Expenses for the quarter ended December 31, 2008 increased $35.5 million from the same quarter last year. Natural and propane gas expense increased $32.1 million, or 14.4%, from last year s level, primarily attributable to increased system volumes purchased for sendout and higher rates charged by our suppliers, partially offset by lower off-system gas expense. Other operation and maintenance expenses increased $1.4 million, or 3.3%, primarily due to higher wage rates, increased charges for outside services, and increased group insurance charges, partially offset by a decrease in injuries and damages expense. Taxes, other than income taxes, increased $1.7 million, or 10.1%, primarily due to increased gross receipts taxes (attributable to the increased revenues).
The $0.6 million decrease in interest charges was primarily due to lower interest on short-term debt, partially offset by an increase in interest on long-term debt, primarily attributable to the issuance of $80.0 million First Mortgage Bonds on September 23, 2008. Average short-term interest rates were 3.0% for the quarter ended December 31, 2008 compared with 5.1% for the quarter ended December 31, 2007. Average short-term borrowings were $262.6 million for the quarter ended December 31, 2008 compared with $255.2 million for the quarter ended December 31, 2007.
During fiscal 2006, the MoPSC approved permanent modifications to the Cold Weather Rule affecting the disconnection and reconnection practices of utilities during the winter heating season. Those modifications included provisions to allow the Utility to obtain accounting authorizations and defer for future recovery certain costs incurred with the modifications. During fiscal 2007, the Utility deferred for future recovery $2.7 million of costs associated with the fiscal 2007 heating season. On October 31, 2007, the Utility filed for determination and subsequent recovery of the deferred amount. On November 16, 2007, the MoPSC directed the MoPSC Staff and the Missouri Office of Public Counsel (Public Counsel) to submit their positions regarding the Utility s filing by February 28, 2008. On February 28, 2008, the Utility and the MoPSC Staff filed a Non-Unanimous Stipulation & Agreement in which these parties agreed to a recovery of $2.5 million of costs. The Non-Unanimous Stipulation & Agreement was opposed by Public Counsel, and a hearing in this matter was held before the Commission on March 31, 2008. On April 17, 2008, the Commission issued its Report and Order approving the $2.5 million cost recovery recommended by the Utility and the MoPSC Staff. Consistent with the approved amount, the Utility recorded a reduction in its deferral totaling $0.2 million during the quarter ended March 31, 2008. On May 29, 2008, Public Counsel appealed the MoPSC s April 17 Order to the Cole County, Missouri Circuit Court. On January 6, 2009, the Court issued its judgment affirming the Commission s order approving the Cold Weather Rule compliance cost amount that the Utility and Staff had recommended over Public Counsel s objection.
On December 28, 2006, the MoPSC Staff proposed a disallowance of $7.2 million related to Laclede Gas recovery of its purchased gas costs applicable to fiscal 2005. On September 14, 2007, the Staff withdrew its pursuit of $5.5 million of the disallowance it had originally proposed. Laclede Gas believes that the remaining $1.7 million of the MoPSC Staff s proposed disallowance lacks merit and is vigorously opposing the adjustment in proceedings before the MoPSC.
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The Laclede Group Inc. is a public utility engaged in the retail distribution and transportation of natural gas. The Company which is subject to the jurisdiction of the Missouri Public Service Commission serves the City of St. Louis St. Louis County the City of St. Charles St. Charles County the town of Arnold and parts of Franklin Jefferson St. Francois Ste. Genevieve Iron Madison and Butler Counties all in Missouri. The Laclede Group Inc. has a market cap of $972.22 million; its shares were traded at around $45.39 with a P/E ratio of 18.1 and P/S ratio of 0.44. The dividend yield of The Laclede Group Inc. stocks is 3.5%. The Laclede Group Inc. had an annual average earning growth of 1.3% over the past 10 years.
Highlight of Business Operations:
Laclede Group s consolidated net income was $31.3 million for the quarter ended December 31, 2008, compared with $20.9 million for the quarter ended December 31, 2007. Basic and diluted earnings per share for the quarter ended December 31, 2008 were $1.43 and $1.42, respectively, compared with basic and diluted earnings per share of $0.97 reported for the same quarter last year. Results for the quarter ended December 31, 2007 included the effect of SM&P s seasonal operating loss, reported as discontinued operations this year as a result of the sale of SM&P on March 31, 2008. Consolidated earnings per share increased compared to last year primarily due to strong performance reported by Laclede Group s Non-Regulated Gas Marketing segment.Laclede Group s income from continuing operations was $31.3 million for the quarter ended December 31, 2008, compared with $21.5 million for the quarter ended December 31, 2007. Basic and diluted earnings per share from continuing operations were $1.43 and $1.42, respectively, for the quarter ended December 31, 2008, compared with basic and diluted earnings per share of $1.00 for the quarter ended December 31, 2007. Earnings results reported by both Laclede Group s Non-Regulated Gas Marketing segment and its Regulated Gas Distribution segment increased over the quarter ended December 31, 2007. Variations in income from continuing operations were primarily attributable to the factors described below.
Regulated Gas Distribution Operating Expenses for the quarter ended December 31, 2008 increased $35.5 million from the same quarter last year. Natural and propane gas expense increased $32.1 million, or 14.4%, from last year s level, primarily attributable to increased system volumes purchased for sendout and higher rates charged by our suppliers, partially offset by lower off-system gas expense. Other operation and maintenance expenses increased $1.4 million, or 3.3%, primarily due to higher wage rates, increased charges for outside services, and increased group insurance charges, partially offset by a decrease in injuries and damages expense. Taxes, other than income taxes, increased $1.7 million, or 10.1%, primarily due to increased gross receipts taxes (attributable to the increased revenues).
The $0.6 million decrease in interest charges was primarily due to lower interest on short-term debt, partially offset by an increase in interest on long-term debt, primarily attributable to the issuance of $80.0 million First Mortgage Bonds on September 23, 2008. Average short-term interest rates were 3.0% for the quarter ended December 31, 2008 compared with 5.1% for the quarter ended December 31, 2007. Average short-term borrowings were $262.6 million for the quarter ended December 31, 2008 compared with $255.2 million for the quarter ended December 31, 2007.
During fiscal 2006, the MoPSC approved permanent modifications to the Cold Weather Rule affecting the disconnection and reconnection practices of utilities during the winter heating season. Those modifications included provisions to allow the Utility to obtain accounting authorizations and defer for future recovery certain costs incurred with the modifications. During fiscal 2007, the Utility deferred for future recovery $2.7 million of costs associated with the fiscal 2007 heating season. On October 31, 2007, the Utility filed for determination and subsequent recovery of the deferred amount. On November 16, 2007, the MoPSC directed the MoPSC Staff and the Missouri Office of Public Counsel (Public Counsel) to submit their positions regarding the Utility s filing by February 28, 2008. On February 28, 2008, the Utility and the MoPSC Staff filed a Non-Unanimous Stipulation & Agreement in which these parties agreed to a recovery of $2.5 million of costs. The Non-Unanimous Stipulation & Agreement was opposed by Public Counsel, and a hearing in this matter was held before the Commission on March 31, 2008. On April 17, 2008, the Commission issued its Report and Order approving the $2.5 million cost recovery recommended by the Utility and the MoPSC Staff. Consistent with the approved amount, the Utility recorded a reduction in its deferral totaling $0.2 million during the quarter ended March 31, 2008. On May 29, 2008, Public Counsel appealed the MoPSC s April 17 Order to the Cole County, Missouri Circuit Court. On January 6, 2009, the Court issued its judgment affirming the Commission s order approving the Cold Weather Rule compliance cost amount that the Utility and Staff had recommended over Public Counsel s objection.
On December 28, 2006, the MoPSC Staff proposed a disallowance of $7.2 million related to Laclede Gas recovery of its purchased gas costs applicable to fiscal 2005. On September 14, 2007, the Staff withdrew its pursuit of $5.5 million of the disallowance it had originally proposed. Laclede Gas believes that the remaining $1.7 million of the MoPSC Staff s proposed disallowance lacks merit and is vigorously opposing the adjustment in proceedings before the MoPSC.
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