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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Fiscal Year Ended September 30, 1996
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the Transition Period from ________ to ________
Commission File Number 1-1822
LACLEDE GAS COMPANY
(Exact name of registrant as specified in its charter)
Missouri 43-0368139
(State of incorporation) (I.R.S. Employer Identifacation Number)
720 Olive Street, St. Louis, Missouri 63101
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 314-342-0500
Securities registered pursuant to Section 12(b) of the Act:
Name of each stock exchange
Title of each class on which registered
Common Stock - $1 par value New York and Chicago
Common Stock Purchase Rights New York and Chicago
Securities registered pursuant to Section 12(g) of the Act:
Title of each class
Preferred Stock - $25 par value
(5% Series B Preferred Stock and
4.56% Series C Preferred Stock)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes (X) No ( )
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form
10-K or any amendment to this Form 10-K. (X)
The aggregate market value of the Common Stock of the Company, none of
which is owned by an affiliate, at November 30, 1996 was $418,552,386.
Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the close of the period covered by this
report. 17,557,540
Incorporated by Reference: Form 10-K Part
Proxy Statement dated December 20, 1996* III
Index to Exhibits is found on page 46.
* The information under the captions "Compensation Committee Report
Regarding Compensation" and "Performance Graph" on pages 13-16 of the Proxy
Statement is NOT incorporated by reference.
1 <PAGE>
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PART I
Item 1. Business
Laclede Gas Company 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, and parts of St.
Charles, Franklin, Jefferson, St. Francois, Ste. Genevieve, Iron, Madison
and Butler Counties, all in Missouri. As an adjunct to its gas distribution
and transportation business, the Company operates underground natural gas
storage fields and is engaged in the transportation and storage of liquid
propane. The Company has engaged in exploration for and development of
natural gas on a utility and non-utility basis. Certain gas production
sales are subject to the regulation of the Federal Energy Regulatory
Commission. The Company has also made investments in other non-utility
businesses as part of a diversification program.
NATURAL GAS SUPPLY
Laclede obtains the majority of its gas from Gulf Coast and Mid-Continent
producing areas and arranges to have it transported through several
interstate pipelines into the pipeline systems of Mississippi River
Transmission Corporation (MRT) for ultimate delivery to Laclede's service
area. Laclede utilizes firm pipeline transportation capacity, which
connects the pipelines "upstream" of the MRT system to the onshore and
offshore gas-producing basins. During fiscal year 1996, Laclede continued
to release firm transportation capacity to other gas users when Laclede did
not need such capacity for itself and its own customers. As a result,
Laclede reduced its overall costs during 1996 by approximately $6.7 million.
During fiscal 1996, Laclede purchased natural gas from a diverse group of 44
suppliers to meet its current gas sales and storage injection requirements.
Natural gas purchased by Laclede for delivery to the Company's service area
through the MRT system during fiscal 1996 totalled 92.8 billion cubic feet
(Bcf). In addition, Laclede purchased 10.2 Bcf of gas from the Mid-
Continent region under a firm supply contract with Vesta Energy Company
(Vesta), which gas was transported through Panhandle Eastern Pipeline
Company and was delivered through the Missouri Pipeline Company (MPC) to
Laclede take-points in St. Charles and Franklin Counties. The previously
existing firm supply arrangement with Vesta has been replaced with a new,
five-year supply agreement with CoEnergy Trading Company, a subsidiary of
MCN Corporation.
The fiscal 1996 peak day sendout of 1,170,000 MMBtu of gas occurred on
Friday, February 2, 1996, when the average temperature was -3 degrees
Fahrenheit. This peak day sendout was met by using 649,000 MMBtu of gas
purchased and transported using the MRT system, 281,000 MMBtu of gas
withdrawn from Laclede's storage facilities, 162,000 MMBtu of gas vaporized
through Laclede's propane facilities, 56,000 MMBtu of gas purchased under
the Company's gas supply contract with Vesta, and 22,000 MMBtu of gas not
owned by the Company that was transported for Laclede customers. The
weather experienced during fiscal 1996 was 4% colder than normal; in fiscal
1995, the weather was 15% warmer than normal. The Company sold and
transported 1,144.0 million therms of gas this year, an increase of 165.9
million therms from fiscal 1995.
2<PAGE>
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UNDERGROUND NATURAL GAS STORAGE
The Company has a firm storage service agreement with MRT for approximately
23.5 billion cubic feet of allocated storage capacity on MRT's system
located primarily in Unionville, Louisiana. MRT's tariffs provide for
injections into the allocated storage capacity between May 16 through
November 15. The Company must withdraw all but 2.3 Bcf during the November
16 through May 15 period.
The Company supplements flowing pipeline gas with natural gas withdrawn from
its underground storage fields located in St. Louis and St. Charles
Counties. The fields are designed to provide 357,000 MMBtu of natural gas
withdrawals on a peak day, and annual withdrawals of approximately 5,500,000
MMBtu based on the inventory level which the Company plans to maintain.
PROPANE SUPPLY
Laclede Pipeline Company, a wholly owned subsidiary, owns and operates a
propane pipeline which connects the parent company's 800,000-barrel
(approximately 33 million gallons) propane storage facilities in St. Louis
County, Missouri, to propane supply terminal facilities located at Wood
River and Cahokia, Illinois. Liquid propane is transported through this
pipeline for delivery to the parent company for storage, to be ultimately
vaporized and used during those periods of operation when the natural gas
supply has to be supplemented to meet the peak demands of the distribution
system. The Company's contract with Phillips Petroleum Company provides for
delivery of up to 35 million gallons of propane annually through March 31,
1999, and year to year thereafter unless terminated by either party.
EXPLORATION AND DEVELOPMENT
The Company's exploration and development activities are segregated into two
distinct functions: utility and non-utility. Under the utility program,
the Company has participated in drilling 96 wells over its twenty-five year
span with 52 of the wells being commercially productive. Since 1981, this
program has been limited to development activities. Capital expenditures in
recent years have not been significant, amounting to $104,000 in 1996,
$(8,000) in 1995 and $10,000 in 1994, for the utility program.
Beginning in 1981, the Company continued its search for gas and oil
discoveries through Laclede Energy Resources, Inc. (LER), a wholly owned,
non-utility subsidiary, which is the general partner in LIMA Resources
Associates, a limited partnership in which LER holds a 39.6% interest. LIMA
has four limited partners, three of which are subsidiaries of gas
transportation and/or distribution companies, each holding an interest of
19.8%. The remaining limited partner, a stock brokerage firm, has a 1.0%
interest.
Laclede's non-utility exploratory drilling program to date has involved
participation in drilling a total of 92 wells. Fifty of these wells were
successfully completed after testing commercial quantities of hydrocarbon
reserves. Forty-two wells were plugged and abandoned. The investment in
the program changed only slightly during 1996, 1995 and 1994. Presently,
Laclede is not actively seeking new gas and oil exploration discoveries
through LIMA, or otherwise.
3<PAGE>
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NON-TRADITIONAL GAS MARKETING
During the 1995-1996 heating season, the Company and LER began marketing
natural gas for delivery in areas primarily outside Laclede's historical
service area. These efforts made a favorable contribution to earnings, as
the Company was able to take advantage of strong demand for gas caused by
some periods of extremely cold weather in certain areas of the nation. The
impact on earnings from such non-traditional gas marketing efforts in 1996
was $3.1 million. This benefit may not be representative of the effect of
such efforts in the future because such operations are volatile and
seasonal. The settlement in the Company's 1996 general rate case, as
approved by the Missouri Public Service Commission (MoPSC), provided that
certain utility gas marketing efforts will be covered by a Gas Supply
Incentive Plan, effective October 1, 1996. This settlement is discussed
further in the Regulatory Matters section below.
REGULATORY MATTERS
At the federal level, Laclede continues to monitor the rulings of the
Federal Energy Regulatory Commission (FERC) and the filings of various
interstate pipelines that directly affect the interests of Laclede and its
customers.
In July 1996, the Washington, D.C. Circuit Court of Appeals issued an
opinion that largely upheld the legality of FERC Order 636, which required
interstate natural gas pipelines, among other things, to unbundle their
former sales services. However, the Court did remand several less
significant aspects of the Order to the FERC for further explanation or
modification. At this time, Laclede does not anticipate that it will be
affected to any material extent by any action that the FERC may take as a
result of the remanded matters.
In April 1996, Laclede's largest supplier of interstate pipeline
transportation services, MRT, filed a rate increase before the FERC which,
if approved in full, would increase the Company's gas costs by more than $13
million annually. The FERC suspended the implementation of these rates
until October 1, 1996, at which time MRT implemented them subject to refund.
Laclede is taking an active role in this case to assure itself and its
customers that any increase ultimately granted MRT is entirely justified.
On December 15, 1995, the Company filed a request with the MoPSC seeking a
general rate increase of $23.8 million annually. This filing culminated in
a settlement approved by the MoPSC on August 28, 1996, providing the Company
an annual increase in revenues of $9.5 million effective September 1, 1996.
In addition, the settlement provides for a Gas Supply Incentive Plan to be
effective October 1, 1996, for a three-year period ending September 30,
1999. Under the incentive plan, the Company and its customers will share
certain gas cost savings which the Company may be able to realize in
connection with the procurement of gas supply and transportation services.
The incentive mechanism will also apply to much of the Company's new non-
traditional gas marketing efforts discussed above. The Company believes
this settlement is reasonable and anticipates that the new incentive plan
will be mutually beneficial to both share owners and customers. The
Company's last general rate increase was effective September 1, 1994, and
amounted to $12.2 million annually.
4<PAGE>
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In certain proceedings, the MoPSC has examined the operation of purchased
gas adjustment clauses under which gas distribution utilities, such as
Laclede, pass through to customers increases and decreases in the wholesale
cost of natural gas. In January 1996, the MoPSC issued an order in which it
rejected arguments that such clauses were unlawful and affirmed the legality
of such a clause utilized by another utility. In December 1996, the Circuit
Court of Cole County, Missouri upheld the MoPSC's order. It is anticipated
that one or more of the parties will appeal the Circuit Court's decision.
Laclede participated in the proceedings before the MoPSC and the Circuit
Court.
OTHER PERTINENT MATTERS
The business of the Company is subject to a seasonal fluctuation with the
peak period occurring in the winter season.
*****
As of September 30, 1996, the Company had 2,072 employees, which includes 3
part-time employees.
*****
The Company has a three-year labor agreement, which expires July 31, 1997,
with Locals 5-6 and 5-194 of the Oil, Chemical and Atomic Workers
International Union, two unions which represent approximately 70% of the
Company's employees. The agreement provided for a wage increase of 3.25%
effective August 1, 1996.
*****
The Company's business has monopoly characteristics in that it is the only
distributor of natural gas within its (franchised) service area. The
principal competition is the local electric company. Other competitors in
Laclede's service area include suppliers of fuel oil, coal, liquefied
petroleum gas in outlying areas, and in a portion of downtown St. Louis, a
district steam system. Gas for househeating, certain other household uses,
and commercial and industrial space heating is now being sold by Laclede at
prices generally lower than are charged for competitive fuels and other
energy forms. Coal is competitive as a fuel source for very large boiler
plant loads, but environmental concerns have forestalled any significant
market inroads. Oil and propane can be used to fuel boiler loads and
certain direct-fired process applications, but these fuels vary widely in
price throughout the year, thus limiting the competitiveness of these fuels.
In certain cases, district steam has been competitive with gas for downtown
area heating users. In the past five years, Laclede has converted 53 steam
customers representing approximately 1.8 million annual therms.
Laclede's residential, commercial, and small industrial markets,
representing 90% of sales, remain committed to gas. The Company knows of no
reason why natural gas should not continue generally to have a price
advantage over electricity and other forms of energy in the foreseeable
future. The Company's exposure to price competition is not presently a
substantial factor and exists primarily in the large industrial and
commercial boiler fuel market where coal is the competing form of energy.
5<PAGE>
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Laclede offers gas transportation service to its large user industrial and
commercial customers. The tariff approved for that type of service produces
a margin similar to that which Laclede would have received under its regular
sales rates. The availability of gas transportation service and favorable
spot market prices for natural gas during certain times of the year may
offer additional competitive advantages to Laclede and new opportunities for
cogeneration and large tonnage air conditioning applications.
*****
For a discussion of environmental matters, see Note 9, Commitments and
Contingencies, of the Notes to Financial Statements in Part II, Item 8,
Financial Statements and Supplementary Data.
*****
The Company issued 137,913 and 174,604 shares of its common stock during
fiscal years 1996 and 1995, respectively, under its Dividend Reinvestment
and Stock Purchase Plan.
During 1995, the Company issued 1,575,000 shares of common stock through a
public offering. The net proceeds of the offering, after deducting discount
and expenses, was $28.6 million.
*****
Customers and revenues contributed by each class of customers for the last
three fiscal years are as follows:
<TABLE>
Revenues $(000)
<CAPTION>
1996 1995 1994
---- ---- ----
<S> <C> <C> <C>
Residential $376,818 $302,770 $363,058
Commercial & Industrial 145,466 109,270 142,042
Interruptible 2,035 1,655 1,966
Transportation 15,375 13,211 14,898
Exploration & Development 856 1,447 1,600
Provision for Refunds - - (3,770)
Other 4,266 3,564 4,072
-------- -------- --------
Total $544,816 $431,917 $523,866
======== ======== ========
Customers (End of Period) 1996 1995 1994
---- ---- ----
Residential 569,818 566,421 559,225
Commercial & Industrial 37,735 37,409 36,684
Interruptible 16 16 14
Transportation 130 129 124
------- ------- -------
Total 607,699 603,975 596,047
======= ======= =======
</TABLE>
6<PAGE>
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The Company has, or in one instance, will seek renewal of and, in another
instance, is seeking for the first time, franchises having initial terms
varying from five years to indefinite duration. All of the franchises are
free from unduly burdensome restrictions. The foregoing are adequate for
the conduct of its public utility business in the State of Missouri as now
conducted.
*****
Laclede Investment Corporation, a wholly owned subsidiary, invests in other
enterprises and has made loans to several joint ventures engaged in real
estate development.
Laclede Energy Resources, Inc., a wholly owned subsidiary of Laclede
Investment, engaged in the exploration and development of oil and gas
properties on a non-utility basis. Exploration and development projects
were conducted through LIMA Resources Associates, a limited partnership.
As general partner, Laclede Energy Resources, Inc. has a 39.6% interest in
LIMA. Laclede Energy is not presently actively seeking new gas and oil
exploration discoveries through LIMA, or otherwise. In fiscal 1996, Laclede
Energy Resources, Inc. began non-utility efforts to market natural gas for
delivery in areas primarily outside the Company's regulated service area.
Laclede Gas Family Services, Inc., a wholly owned subsidiary of Laclede
Energy Resources, Inc., is a registered insurance agency in the State of
Missouri. It is currently promoting the sale of supplemental
hospitalization, accident, supplemental medicare and life insurance by Life
Insurance Company of North America, Washington National Insurance Company
and Fidelity Security Life Insurance Company.
Laclede Development Company, a wholly owned subsidiary, participates in real
estate development, primarily through joint ventures. In 1992, Laclede
Development filed a lawsuit alleging fraud, negligent misrepresentation, and
other claims against the Resolution Trust Corporation (RTC) and certain
former senior executives of Germania Bank, a federal savings institution,
now in conservatorship ("Germania"). This suit arose in connection with
Laclede Development's loss on an investment in a $5.8 million convertible
debenture issued by Germania. That lawsuit was recently settled with the
RTC, but remains pending against certain individual defendants.
Laclede Venture Corp., a wholly owned subsidiary of Laclede Development
Company, has a 28.5% interest in the LBP Partnership (LBP), a general
partnership which previously engaged in research and development of light
beam profiling technology. There are presently no earnings anticipated from
this partnership investment. Laclede Venture Corp. also offers services for
the compression of natural gas to third parties who desire to use or to sell
compressed natural gas for use in vehicles.
The lines of business which constitute the non-utility activities of the
corporate family are not considered significant as defined.
7 <PAGE>
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Item 2. Properties
The principal utility properties of Laclede consist of approximately 7,609
miles of gas main and related service pipes, meters and regulators. Other
physical properties include regional office buildings and holder stations.
Extensive underground gas storage facilities and equipment are located in an
area in North St. Louis County extending under the Missouri River into St.
Charles County. Substantially all of the Company's utility plant is subject
to the liens of its mortgage.
All of the utility properties of Laclede are held in fee or by easement or
under lease agreements. The principal lease agreements include underground
storage rights which are of indefinite duration and the general office
building. The current lease on the general office building extends through
February 2000 with options to renew for up to 20 additional years. Laclede
Gas Company owns interests in oil and gas properties in Texas, Oklahoma and
Louisiana.
The non-utility properties of Laclede do not constitute a significant
portion of the properties of the Company.
Item 3. Legal Proceedings
For a discussion of environmental matters, see Note 9, Commitments and
Contingencies, of the Notes to Financial Statements in Part II, Item 8,
Financial Statements and Supplementary Data.
Item 4. Submission of Matters to a Vote of Security Holders
There were no matters submitted to a vote of security holders during the
fourth quarter of fiscal year 1996.
8<PAGE>
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EXECUTIVE OFFICERS OF REGISTRANT
Name, Age, and Position with Company Appointed (1)
R. C. Jaudes, Age 62
Chairman, President and Chief Executive Officer January 27, 1994
President and Chief Executive Officer August 1, 1991
President and Chief Operating Officer October 1, 1990
Executive Vice President -
Operations and Marketing July 1, 1989
D. H. Yaeger, Age 47
Executive Vice President - Operations and
Marketing September 1, 1995
Senior Vice President - Operations, Gas
Supply and Technical Services January 27, 1994
Vice President - Operations, Gas Supply
and Technical Services September 1, 1992
Vice President - Planning December 1, 1990
D. L. Godiner, Age 63
Senior Vice President - General Counsel
and Secretary January 24, 1991
Vice President - General Counsel and Secretary September 1, 1990
R. M. Lee, Age 55
Senior Vice President - Administrative Services September 1, 1995
Senior Vice President - Marketing January 27, 1994
Vice President - Marketing January 22, 1987
G. T. McNeive, Jr., Age 54
Senior Vice President - Finance and Chief
Financial Officer September 1, 1995
Vice President - Associate General
Counsel January 27, 1994
Assistant Vice President - Associate
General Counsel September 1, 1992
(Associate General Counsel) August 1, 1986
K. J. Neises, Age 55
Senior Vice President - Gas Supply and
Regulatory Affairs September 1, 1995
Senior Vice President - Federal Regulatory
Affairs January 27, 1994
Vice President - Federal Regulatory Affairs October 27, 1988
J. G. Hofer, Age 59
Vice President - Operations July 1, 1992
(Superintendent of Operations) July 1, 1991
M. E. McMillian, Age 50
Vice President - Human Resources September 22, 1983
J. Moten, Jr., Age 55
Vice President - Community Relations January 27, 1994
(Director of Community Affairs/Conservation) November 1, 1986
9 <PAGE>
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P. J. Palumbo, Age 51
Vice President - Industrial Relations September 1, 1992
(Director of Industrial Relations) January 7, 1991
R. L. Krutzman, Age 50
Treasurer and Assistant Secretary February 1, 1996
(Manager, Tax and Payroll) February 1, 1992
(Tax Manager) August 1, 1985
( ) Indicates a non-officer position.
(1) Officers of Laclede Gas Company are normally reappointed at the Annual
Meeting of the Board of Directors in January of each year "to serve
for the ensuing year and until their successors are elected and
qualify".
Part II
Item 5. Market for the Registrant's Common Equity and Related Share Owner
Matters
The Company's common stock is listed on the New York Stock Exchange and the
Chicago Stock Exchange. At September 30, 1996, there were 10,970 holders of
record of the Company's common stock.
<TABLE>
Common Stock Market and Dividend Information
<CAPTION>
Price Range Dividends
Fiscal 1996 High Low Declared
- --------------------------------------------------------
<S> <C> <C> <C>
1st Quarter 23-1/8 19-5/8 $.315
2nd Quarter 24-1/4 20 $.315
3rd Quarter 24-3/8 21-1/4 $.315
4th Quarter 24-3/4 20-3/4 $.315
</TABLE>
<TABLE>
<CAPTION>
Price Range Dividends
Fiscal 1995 High Low Declared
- --------------------------------------------------------
<S> <C> <C> <C>
1st Quarter 21-1/2 18-1/4 $.31
2nd Quarter 20-1/4 18-1/2 $.31
3rd Quarter 20 18-3/8 $.31
4th Quarter 20-3/4 19 $.31
</TABLE>
10<PAGE>
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<TABLE>
Item 6. Selected Financial Data
<CAPTION>
Fiscal Years Ended September 30
(Thousands Except Per Share 1996 1995 1994 1993 1992
Amounts) ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Summary of Operations
Utility Operating Revenues $544,816 $431,917 $523,866 $503,948 $418,190
------------------------------------------------
Utility Operating Expenses:
Natural and propane gas 308,406 221,423 308,515 291,057 235,562
Other operation expenses 84,544 80,573 84,906 81,027 73,521
Maintenance 18,127 17,508 18,351 16,693 15,358
Depreciation & amortization 25,009 23,676 19,332 18,704 18,033
Taxes, other than
income taxes 44,987 40,529 42,627 41,061 35,333
Income Taxes 17,348 9,878 12,517 14,997 8,272
------------------------------------------------
Total Utility Operating
Expenses 498,421 393,587 486,248 463,539 386,079
------------------------------------------------
Utility Operating Income -
Distribution 46,395 38,330 37,618 40,409 32,111
Other Utility Oper Income -
Off System Sales - Net 2,015 - - - -
------------------------------------------------
Total Utility Oper Income 48,410 38,330 37,618 40,409 32,111
Allowance for Funds Used
During Construction 17 247 203 186 377
Miscellaneous Income and
Income Deductions - Net 2,344 851 790 785 1,400
------------------------------------------------
Income Before Interest
Charges 50,771 39,428 38,611 41,380 33,888
------------------------------------------------
Interest Charges:
Interest on long-term debt 13,939 12,544 12,626 14,415 13,803
Other interest charges 4,008 5,983 3,768 1,798 1,811
------------------------------------------------
Total Interest Charges 17,947 18,527 16,394 16,213 15,614
------------------------------------------------
Net Income 32,824 20,901 22,217 25,167 18,274
Dividends on Preferred Stk 97 97 97 97 97
------------------------------------------------
Earnings Applicable to
Common Stock $ 32,727 $ 20,804 $ 22,120 $ 25,070 $ 18,177
================================================
Earnings Per Share of
Common Stock $1.87 $1.27 $1.42 $1.61 $1.17
================================================
</TABLE>
11<PAGE>
<PAGE>
<TABLE>
Item 6. Selected Financial Data
<CAPTION>
Fiscal Years Ended September 30
(Thousands Except Per Share 1996 1995 1994 1993 1992
Amounts) ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Dividends Declared-
Common Stock $ 22,079 $ 20,538 $ 19,054 $ 18,938 $ 18,703
Dividends Declared Per
Share of Common Stock $1.26 $1.24 $1.22 $1.215 $1.20
Utility Plant
Gross Plant-End of Period $780,001 $745,629 $709,563 $677,613 $643,587
Net Plant-End of Period 452,165 434,336 411,677 390,826 367,287
Construction Expenditures 41,205 45,804 39,193 40,880 44,660
Property Retirements 6,486 9,199 6,757 6,135 5,693
Total Assets 689,395 636,694 608,295 515,312 470,463
Capitalization -
End of Period
Common Stock and Paid-In
Capital $ 80,628 $ 77,686 $ 45,638 $ 43,702 $ 43,702
Retained Earnings 184,232 173,584 173,318 170,252 164,120
Treasury Stock (24,017) (24,017) (24,017) (24,017) (24,017)
-----------------------------------------------
Common Stock Equity 240,843 227,253 194,939 189,937 183,805
Redeemable Preferred Stock 1,960 1,960 1,960 1,960 1,960
Long-Term Debt 179,346 154,279 154,211 165,745 146,640
-----------------------------------------------
Total Capitalization $422,149 $383,492 $351,110 $357,642 $332,405
===============================================
Shares of Common Stock
Outstanding-End of Period 17,558 17,420 15,670 15,586 15,586
Book Value Per Share $13.72 $13.05 $12.44 $12.19 $11.79
</TABLE>
12 <PAGE>
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Item 7. Management's Discussion and Analysis of Financial Condition
and Results of Operations
Results of Operations
Earnings applicable to common stock for the fiscal year ended September
30, 1996 were $32.7 million, compared with $20.8 million for 1995 and $22.1
million for 1994. Earnings per share of common stock based on average
shares outstanding were $1.87 in 1996, compared with $1.27 in 1995 and $1.42
in 1994. The $.60 per share increase in fiscal 1996 (from fiscal 1995) was
primarily due to higher gas sales resulting from colder weather
experienced in the Company's service area this year. Earnings also
benefited from income realized due to new non-traditional gas marketing
efforts, which commenced this fiscal year through the Company and its
wholly owned subsidiary, Laclede Energy Resources, Inc. The impact on
earnings from such non-traditional gas marketing efforts in fiscal 1996 was
$3.1 million. This benefit may not be representative of the effect of such
efforts in the future because such operations are volatile and seasonal.
The settlement in the Company's 1996 general rate case, as approved by the
Missouri Public Service Commission (MoPSC), provided that certain utility
gas marketing efforts will be covered by a Gas Supply Incentive Plan
effective October 1, 1996. This settlement is discussed further below in
the paragraph of the "Results of Operations" discussion. The $.15 per share
decrease in earnings in fiscal 1995 (from fiscal 1994) was primarily due to
decreased sales volumes arising from warmer weather, higher depreciation
rates (as authorized in Case No. GR-94-220 by the MoPSC), higher interest
charges and increased operating costs. These decreases were partially
offset by the benefit of the Company's general rate increase effective
September 1, 1994, lower pension expense and the Company's ongoing cost
reduction efforts. Weather in the metropolitan St. Louis area was 4% colder
than normal in 1996, 15% warmer than normal in 1995, and 1% warmer than
normal in 1994.
Utility operating revenues for fiscal year 1996 increased $112.9
million, or 26.1%, above fiscal 1995, and in 1995 decreased $91.9 million,
or 17.6%, below fiscal 1994. The 1996 increase was principally due to
higher therms sold and transported (mainly arising from colder weather) and
other variations netting to $63.6 million, higher wholesale gas costs of
$48.6 million (which are passed on to customers in accordance with the
Purchased Gas Adjustment Clause), and the one-month benefit of a general
rate increase effective September 1, 1996 of $.7 million. The 1995 decrease
was principally due to lower wholesale gas costs of $56.0 million, lower
therms sold and transported (principally due to the warmer weather) and
other variations netting to $47.4 million. These decreases were partially
offset by increased revenues of $11.5 million arising from the general rate
increase effective September 1, 1994. Therms sold and transported for 1996
were 1,144.0 million compared with 978.1 million in 1995 and 1,070.1 million
in 1994.
Utility operating expenses increased $104.8 million, or 26.6%, in
fiscal 1996, and in 1995 decreased $92.7 million, or 19.1%, below fiscal
1994. Natural and propane gas expense increased $87.0 million in 1996
reflecting increased rates charged by our suppliers and higher volumes
purchased for sendout (resulting from the colder weather). In 1995, natural
and propane gas expense decreased $87.1 million due to lower natural gas
prices and reduced volumes required for sendout. Other operation and
maintenance expenses increased $4.6 million, or 4.7%, in 1996 principally
due to higher net pension costs which resulted partly from pension credits
recorded in fiscal 1995 to establish a regulatory asset (necessary to
13<PAGE>
<PAGE>
reflect pension costs consistent with the regulatory accounting treatment
ordered by the MoPSC in Case No. GR-94-220), and higher wage rates. These
increases were partially offset by the recognition of higher gains on lump-
sum pension settlements and lower group insurance charges. In 1995, other
operation and maintenance charges decreased $5.2 million, or 5.0%, mainly
due to the recording of pension credits and cost reduction efforts. The
pension credits include the recognition of gains on significant lump-sum
settlements and the establishment of a regulatory asset (as discussed
above). These reduced expenses were partially offset by a higher provision
for uncollectible accounts, higher wage rates, and increased group insurance
charges. Depreciation and amortization expense increased 5.6% in 1996
primarily due to additional depreciable property. In 1995, depreciation and
amortization expense increased 22.5% primarily as a result of increased
depreciation rates (as authorized in Case No. GR-94-220) and, to a lesser
extent, additional depreciable property. Taxes, other than income taxes,
increased 11.0% in 1996 principally attributable to higher gross receipts
taxes (mainly reflecting increased revenues), partially offset by lower
property taxes. In 1995, taxes, other than income taxes, decreased 4.9%
primarily due to lower gross receipts taxes (reflecting decreased revenues),
partially offset by higher real estate and personal property taxes. The
$7.5 million increase in income taxes is mainly due to higher taxable
distribution operating income. The variations in income tax expense in 1995
from 1994 levels are mainly due to changes in income and tax adjustments.
Other utility operating income (net of applicable income tax expense)
reflects the Company's new non-traditional gas marketing efforts which
commenced this fiscal year. These marketing efforts, effective October 1,
1996, will be part of the Gas Supply Incentive Plan, as discussed below.
Miscellaneous income and income deductions (net of applicable income
tax expense) increased by $1.3 million in 1996 primarily due to the new gas
marketing efforts of the Company's wholly owned subsidiary, Laclede Energy
Resources, Inc. In 1995, miscellaneous income and income deductions
increased by $.1 million mainly due to slightly improved results from non-
utility diversification activities.
Interest expense decreased by 3.1% in fiscal year 1996 principally due
to lower short-term interest expense reflecting lower average borrowings and
reduced interest on refunds due customers, partially offset by an increase
in interest on long-term debt resulting from the issuance of $25 million of
6-1/2% First Mortgage Bonds in November 1995. In 1995, interest expense
increased 13.0% primarily reflecting higher borrowings, increased rates and
increased interest on refunds due customers.
On December 15, 1995, the Company filed a request with the MoPSC for a
general rate increase of $23.8 million annually. This filing culminated in
a settlement approved by the MoPSC on August 28, 1996, providing the Company
an annual increase in revenues of $9.5 million effective September 1, 1996.
In addition, the settlement provides for a Gas Supply Incentive Plan to be
effective October 1, 1996, for a three-year period ending September 30,
1999. Under the incentive plan, the Company and its customers will share
certain gas cost savings which the Company may be able to realize in
connection with the procurement of gas supply and transportation services.
The incentive mechanism will also apply to much of the Company's new non-
traditional gas marketing efforts. The Company believes this settlement is
reasonable and anticipates that the new incentive plan will be mutually
beneficial to both share owners and customers. The Company's last general
rate increase was effective September 1, 1994, and amounted to $12.2 million
annually.
14<PAGE>
<PAGE>
Accounting Changes
The Financial Accounting Standards Board has issued various accounting
standards that will become effective at some future date, including
Statement of Financial Accounting Standards (SFAS) No. 121, "Accounting for
the Impairment of Long-Lived Assets and for Long-Lived Assets to Be Disposed
Of", and SFAS No. 125, "Accounting for Stock-Based Compensation". The
Company does not expect the adoption of these standards to have a material
effect on the Company's financial position or results of operations.
Inflation
The accompanying Financial Statements reflect the historical costs of
events and transactions, regardless of the purchasing power of the dollar at
the time. Due to the capital intensive nature of the Company's business,
the most significant impact of inflation is on the Company's depreciation of
utility plant. Rate regulation to which the Company is subject allows
recovery through its rates of only the historical cost of utility plant as
depreciation. While no plans exist to undertake other than normal
replacements of plant in service, the Company believes that any higher costs
experienced upon replacement of existing facilities would be recovered
through the normal regulatory process.
Liquidity and Capital Resources
Cash flow from operations, net of dividend payments, has generally
provided the principal liquidity to meet operating requirements and to fund
a portion of the Company's construction program. Any remaining funding
requirement for construction or for other needs has been provided by long-
term and short-term financing. The issuance of long-term financing is
dependent on management's evaluation of need, financial market conditions,
and other factors. Short-term financing is used to meet seasonal cash
requirements and/or to defer long-term financing until market conditions are
favorable.
Short-term borrowing requirements typically peak during colder months,
principally because of required payments for natural gas made in advance of
the receipt of cash from the Company's customers for the sale of that gas.
Such short-term cash requirements have traditionally been met through the
sale of commercial paper supported by lines of credit with banks. In
January 1996, the Company renewed its primary lines of bank credit under
which it may borrow up to an aggregate of $40 million prior to January 31,
1997, with renewal of any loans outstanding on that date permitted up to
June 30, 1997. This, together with the Company's previously obtained
supplemental line of credit, which aggregated about $50 million through
March 1, 1996 (the supplemental line of credit was increased to $60 million
for one day on November 20, 1995), provided total lines of credit of $90
million for the 1995-1996 heating season. Since cash needs typically
decline at the end of the heating season, the Company reduced the
supplemental line of credit to $15 million from March 1, 1996 to April 1,
1996, and allowed the supplemental line of credit to expire on April 1,
1996. In August 1996, the Company obtained a $60 million supplemental line
of credit which extends until March 1, 1997. The Company plans to increase
the supplemental line of credit to $90 million effective on January 1, 1997,
which would provide total lines of credit of $130 million. The Company
anticipates that the supplemental line will be reduced below $60 million
after March 1, 1997. Short-term borrowings outstanding at September 30,
1996 were $59.6 million.
15<PAGE>
<PAGE>
The Company's Shareholder Rights Plan, adopted in 1986, expired on May
1, 1996. The Company decided to keep such protection in place by adopting
a replacement plan. On March 14, 1996, the Company declared a dividend of
one Common Share Purchase Right for each outstanding share of common stock
as of May 1, 1996, each of which common share purchase rights gives the
Rightholder the right to purchase one common share for a purchase price of
$60, subject to adjustment. The rights expire on May 1, 2006, and may be
redeemed by the Company for one cent each at anytime before they become
exercisable. The rights will not be exercisable or transferable apart from
the common stock, until ten days after a person or group acquires or obtains
the right to acquire 20% or more of the common stock, or commences or
announces its intention to commence a tender or exchange offer for 20% or
more of the common stock. Following the former event, a right will entitle
its holder to purchase, at the purchase price, the number of shares equal to
the purchase price (initially $60 per share) divided by one-half of the
market price. Alternatively, the Company may exchange each Right for one
share of Company common stock. A total of 17,557,540 rights were issued on
May 1, 1996.
During 1996, the Company issued 137,913 shares of common stock under
the Dividend Reinvestment and Stock Purchase Plan. Total shares outstanding
were 17,557,540 at September 30, 1996.
On November 16, 1995, the Board of Directors received competitive bids
from various underwriters related to the issuance and sale of First Mortgage
Bonds and the Board elected to sell $25 million of First Mortgage Bonds to
the lowest bidder, at an overall cost to the Company of 6.55%. The Bonds
were dated November 15, 1995 and will mature in 2010. The proceeds were
used for the payment of outstanding short-term borrowings. The bonds were
rated AA- by Fitch, Aa3 by Moody's, and AA- by Standard & Poor's, the same
ratings as applicable to the Company's other outstanding bonds. The bonds
were issued under a previously granted $100 million authorization from the
Missouri Public Service Commission which expires on April 21, 1997. A total
of $50 million of bonds have been issued and sold under this authorization.
The amounts and timing of any future issuance will depend on management's
evaluation of need, financial market conditions, and other factors.
Construction expenditures for utility purposes were $41.2 million in
fiscal 1996 compared with $45.8 million in fiscal 1995 and $39.2 million in
fiscal 1994. The Company expects fiscal 1997 utility construction
expenditures to approximate $39.2 million.
The Company is subject to various laws and regulations relating to the
environment, which thus far have not had a material effect on the Company's
financial position and results of operations. In the past, the Company
operated various manufactured gas plants which produced by-products and
residuals, including various hydrocarbons. Certain remnants of these
residuals are typically found at former gas manufacturing sites. The United
States Environmental Protection Agency (EPA) and the Company determined that
such residuals were present at one of the Company's former manufactured gas
plant sites located in Shrewsbury, Missouri (the Shrewsbury Site). The
Company and EPA also agreed to a plan under which the Company would perform
certain tests, analyses, and evaluations at the Shrewsbury Site. After
reviewing the results of this investigation, the EPA suggested, and the
Company agreed to perform, a limited removal of some contaminants on small
areas of the site. Subsequently, the Missouri Department of Natural
Resources (MoDNR) suggested some additional possible actions at the site,
most of which the Company also agreed to perform.
16<PAGE>
<PAGE>
After the Company's response to MoDNR's initial suggestions, MoDNR expressed
further concerns, and has suggested further evaluation measures. The
Company has contested these expressions of further concern, and has provided
detailed technical support for the Company's position to the MoDNR and EPA.
Currently, the MoDNR and EPA are considering the Company's response.
At this time, given the lack of final agreement as to whether any
additional actions should be taken, the ultimate costs to be incurred
regarding the Shrewsbury Site remain unclear. If the limited removal
actions agreed to by the Company and EPA are implemented, together with the
initial MoDNR suggested actions, the Company estimates that the overall
approximate costs, including EPA's oversight and other associated legal,
investigation and engineering consulting expenses, will range from $600,000
to $715,000. As of September 30, 1996, $482,000 of such overall costs had
been paid, and an additional $118,000 was reserved by the Company. If the
Company is required to take any additional actions with regard to the site,
the Company may have to incur additional costs, the extent of which cannot
practicably be estimated currently. The Company has notified its insurers
that the Company intends to seek reimbursement from them of its
investigation, remediation, clean-up and defense costs. The Company intends
to seek recovery, if practicable, from any other potentially responsible
parties.
In a separate matter, MoDNR has accepted the Company's application to
place the site of a different former manufactured gas plant located in the
City of St. Louis, Missouri (which site was also used by subsequent owners
as the site of a coke manufacturing facility) in the Missouri environmental
remediation program. Preliminary tests conducted by MoDNR at the site
reflect the presence of coke and gas plant manufacturing wastes, as well as
certain heavy metal wastes. The Company and MoDNR have agreed that the
Company's initial investigation should focus mainly on determining whether
ground water is contaminated and, if so, whether it presents any risks to
receptor populations. The Company currently estimates that the cost of its
investigation, MoDNR oversight costs and associated legal and engineering
consulting costs relative to the site will together approximate $75,000. As
of September 30, 1996, $7,000 had been paid and an additional $68,000 was
reserved on the Company's books. The Company has notified its insurers that
the Company intends to seek reimbursement from them for investigation,
remediation, clean-up and defense costs. The Company has also requested
that other former site owners and/or operators participate in the cost of
any site investigation, but none has yet agreed to do so. The Company plans
to seek proportionate reimbursement of all costs incurred with respect to
this site from such parties and/or any other potentially responsible
parties, to the extent practicable.
The Company is presently unable to evaluate or quantify further the
scope or cost of any environmental response activity with regard to the
above two former manufactured gas plant sites.
As a part of a 1994 rate case settlement, the MoPSC approved an
environmental cost deferral procedure, effective September 1, 1994, for the
Company's use in applying for appropriate rate recovery of various
investigation, remediation and other costs in connection with manufactured
gas plants. In the Company's most recent rate case, the MoPSC approved,
effective September 1, 1996, the continued use of a similar cost deferral
mechanism. This authorization will be null and void if the Company does not
file to further adjust its rates by September 1, 1998; and, in any event the
recovery of costs thus deferred may be challenged in future rate
proceedings.
17<PAGE>
<PAGE>
The Company, through a non-utility subsidiary, has agreed to finance,
construct and maintain a compressed natural gas (CNG) fueling facility for
the Bi-State Development Agency, the operator of the St. Louis area's mass
transit system. The station is the first phase of a planned four-phase,
$4.4 million, CNG fueling facility. When the $1.9 million first phase is
completed in early 1997, it will enable Bi-State to fuel 50 CNG buses within
a short time period. Later phases now planned will increase the capacity of
the fueling facility to accommodate the 205 of the approximate 600 buses,
which will constitute the CNG portion of Bi-State's planned fleet for the
next decade.
Capitalization at September 30, 1996, excluding current redemption
requirements of long-term debt, consisted of 57.0% common stock equity, .5%
preferred stock and 42.5% long-term debt.
The Company's ratio of earnings before taxes to interest charges was
3.8 for 1996, 2.6 for 1995 and 3.1 for 1994.
It is management's view that the Company has adequate access to capital
markets and will have sufficient capital resources both internal and
external to meet anticipated capital requirements.
18 <PAGE>
<PAGE>
Item 8. Financial Statements and Supplementary Data
Independent Auditors' Report
We have audited the accompanying consolidated balance sheets and statements
of consolidated capitalization of Laclede Gas Company and its subsidiary
companies as of September 30, 1996 and 1995, and the related statements of
consolidated income, retained earnings, and cash flows for each of the three
years in the period ended September 30, 1996. Our audits also included the
financial statement schedule listed in the Index at Part IV, item 14(a)2.
These financial statements and financial statement schedule are the
responsibility of the Company's management. Our responsibility is to
express an opinion on the financial statements and financial statement
schedule based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, such consolidated financial statements present fairly, in
all material respects, the financial position of Laclede Gas Company and its
subsidiary companies as of September 30, 1996 and 1995, and the results of
their operations and their cash flows for each of the three years in the
period ended September 30, 1996 in conformity with generally accepted
accounting principles. Also, in our opinion, such financial statement
schedule, when considered in relation to the basic consolidated financial
statements taken as a whole, present fairly in all material respects the
information set forth therein.
DELOITTE & TOUCHE LLP
St. Louis, Missouri
November 21, 1996
(December 20, 1996 as to Note 8)
19<PAGE>
<PAGE>
Management Report
Management is responsible for the preparation, presentation and integrity of
the consolidated financial statements and other financial information in
this report. The statements were prepared in conformity with generally
accepted accounting principles and include amounts that are based on
management's best estimates and judgments. In the opinion of management,
the financial statements fairly reflect the Company's financial position,
results of operations and cash flows.
The Company maintains internal accounting systems and related administrative
controls that are designed to provide reasonable assurance, on a cost-
effective basis, that transactions are executed in accordance with
management's authorization, that consolidated financial statements are
prepared in conformity with generally accepted accounting principles, and
that the Company's assets are properly accounted for and safeguarded. The
Company's Internal Audit Department, which has unrestricted access to all
levels of Company management, monitors compliance with established controls
and procedures.
Deloitte and Touche LLP, the Company's independent auditors, whose report is
contained herein, are responsible for auditing the Corporation's financial
statements in accordance with generally accepted auditing standards. Such
standards include obtaining an understanding of the internal control
structure in order to design the audit of the financial statements.
The Audit Committee of the Board of Directors, which consists of five
outside directors, meets periodically with management, the internal auditor,
and the independent auditors to review the manner in which they are
performing their responsibilities. Both the internal auditor and the
independent auditors periodically meet alone with the Audit Committee and
have access to the Audit Committee at any time.
Robert C. Jaudes
Chairman of the Board, President
and Chief Executive Officer
Gerald T. McNeive, Jr.
Senior Vice President-Finance
and Chief Financial Officer
20<PAGE>
<PAGE>
Item 8. Financial Statements and Supplementary Data
<TABLE>
STATEMENTS OF CONSOLIDATED INCOME
(Thousands Except Per Share Amounts)
<CAPTION>
- ---------------------------------------------------------------------------
Years Ended September 30 1996 1995 1994
- ---------------------------------------------------------------------------
<S> <C> <C> <C>
Utility Operating Revenues $544,816 $431,917 $523,866
------------------------------
Utility Operating Expenses
Natural and propane gas 308,406 221,423 308,515
Other operation expenses 84,544 80,573 84,906
Maintenance 18,127 17,508 18,351
Depreciation and amortization 25,009 23,676 19,332
Taxes, other than income taxes 44,987 40,529 42,627
Income taxes (Note 7) 17,348 9,878 12,517
------------------------------
Total utility operating expenses 498,421 393,587 486,248
------------------------------
Utility Operating Income - Distribution 46,395 38,330 37,618
Other Utility Operating Income -
Off System Sales - Net (less applicable
income taxes - Note 7) 2,015 - -
------------------------------
Total Utility Operating Income 48,410 38,330 37,618
Miscellaneous Income and Income Deductions-
Net (less applicable income taxes - Note 7) 2,361 1,098 993
------------------------------
Income Before Interest Charges 50,771 39,428 38,611
------------------------------
Interest Charges:
Interest on long-term debt 13,939 12,544 12,626
Other interest charges 4,008 5,983 3,768
------------------------------
Total interest charges 17,947 18,527 16,394
------------------------------
Net Income 32,824 20,901 22,217
Dividends on Preferred Stock 97 97 97
------------------------------
Earnings Applicable to Common Stock $ 32,727 $ 20,804 $ 22,120
==============================
Average Shares of Common Stock Outstanding 17,523 16,344 15,619
==============================
Earnings Per Share of Common Stock
(after preferred dividends) $1.87 $1.27 $1.42
==============================
<FN>
See the accompanying notes to financial statements.
</TABLE>
21<PAGE>
<PAGE>
<TABLE>
STATEMENTS OF CONSOLIDATED RETAINED EARNINGS
(Thousands Except Per Share Amounts)
<CAPTION>
- ---------------------------------------------------------------------------
Years Ended September 30 1996 1995 1994
- ---------------------------------------------------------------------------
<S> <C> <C> <C>
Balance at Beginning of Year $173,584 $173,318 $170,252
Add - Net income, per statements 32,824 20,901 22,217
-----------------------------
Total 206,408 194,219 192,469
-----------------------------
Deduct - Cash Dividends Declared:
Preferred stock at required annual rates 97 97 97
Common stock, $1.26 per share in 1996,
$1.24 per share in 1995 and $1.22 per
share in 1994 22,079 20,538 19,054
-----------------------------
Total 22,176 20,635 19,151
-----------------------------
Balance at End of Year $184,232 $173,584 $173,318
=============================
<FN>
See the accompanying notes to financial statements.
</TABLE>
22<PAGE>
<PAGE>
<TABLE>
CONSOLIDATED BALANCE SHEETS
(Thousands of Dollars)
<CAPTION>
- ---------------------------------------------------------------------------
September 30 1996 1995
- ---------------------------------------------------------------------------
<S> <C> <C>
Assets
Utility Plant $780,001 $745,629
Less - Accumulated depreciation & amortization 327,836 311,293
--------------------
Net utility plant 452,165 434,336
--------------------
Other Property and Investments, at Cost or Less
(net of accumulated depreciation and amortization,
1996, $9,477; 1995 $9,473) 24,265 22,744
--------------------
Current Assets:
Cash and cash equivalents 4,360 1,555
Accounts receivable:
Gas customers - Billed and unbilled 45,251 34,726
Other 8,311 4,861
Less - Allowances for doubtful accounts (7,984) (5,189)
Inventories:
Materials, supplies and merchandise at avg. cost 5,634 5,377
Natural gas stored underground for current use
at LIFO cost 58,769 41,629
Propane gas for current use at FIFO cost 12,655 13,566
Prepayments 1,910 1,484
Unamortized purchased gas adjustments - 9,776
Deferred income taxes (Note 7) 4,477 -
--------------------
Total current assets 133,383 107,785
--------------------
Deferred Charges 79,582 71,829
--------------------
Total Assets $689,395 $636,694
====================
<FN>
See the accompanying notes to financial statements.
</TABLE>
23 <PAGE>
<PAGE>
<TABLE>
CONSOLIDATED BALANCE SHEETS (Continued)
(Thousands of Dollars)
<CAPTION>
- --------------------------------------------------------------------------
September 30 1996 1995
- --------------------------------------------------------------------------
<S> <C> <C>
Capitalization and Liabilities
Capitalization, per statements:
Common stock equity $240,843 $227,253
Redeemable preferred stock 1,960 1,960
Long-term debt 179,346 154,279
--------------------
Total capitalization 422,149 383,492
--------------------
Current Liabilities:
Notes payable (Note 8) 59,600 59,500
Accounts payable 20,637 21,069
Refunds due customers 1,248 4,110
Advance customer billings 6,231 13,058
Wages payable 3,433 3,117
Dividends payable 5,640 5,538
Customer deposits 3,224 3,447
Interest accrued 7,572 6,953
Taxes accrued 10,212 8,430
Unamortized purchased gas adjustments 26,744 -
Deferred income taxes (Note 7) - 167
Other current liabilities 1,907 2,387
--------------------
Total current liabilities 146,448 127,776
--------------------
Deferred Credits and Other Liabilities:
Deferred income taxes (Note 7) 78,149 83,563
Unamortized investment tax credits (Note 7) 7,669 8,018
Other 34,980 33,845
--------------------
Total deferred credits and other liabilities 120,798 125,426
--------------------
Commitments and Contingencies (Note 9)
Total Capitalization and Liabilities $689,395 $636,694
====================
<FN>
See the accompanying notes to financial statements.
</TABLE>
24<PAGE>
<PAGE>
<TABLE>
STATEMENTS OF CONSOLIDATED CAPITALIZATION
(Thousands of Dollars)
<CAPTION>
- --------------------------------------------------------------------------
September 30 1996 1995
- --------------------------------------------------------------------------
<S> <C> <C>
Common Stock Equity (Note 3):
Common stock, par value $1 per share:
Authorized - 1996 and 1995, 50,000,000 shares
Issued - 1996, 19,423,178 shares;
1995, 19,285,265 shares $ 19,423 $ 19,285
Paid-in capital 61,205 58,401
Retained earnings, per statements 184,232 173,584
Treasury stock, at cost - 1996 and 1995,
1,865,638 shares (24,017) (24,017)
--------------------
Total common stock equity 240,843 227,253
--------------------
Redeemable Preferred Stock,
par value $25 per share (1,480,000 shares
authorized) issued and outstanding (Note 4):
5% Series B - 1996 and 1995, 71,890 shares 1,797 1,797
4.56% Series C - 1996 and 1995, 6,510 shares 163 163
--------------------
Total redeemable preferred stock 1,960 1,960
--------------------
Long-Term Debt (Note 5):
First mortgage bonds:
6-1/4% Series, due May 1, 2003 25,000 25,000
8-1/2% Series, due November 15, 2004 25,000 25,000
8-5/8% Series, due May 15, 2006 40,000 40,000
7-1/2% Series, due November 1, 2007 40,000 40,000
6-1/2% Series, due November 15, 2010 25,000 -
9-5/8% Series, due May 15, 2013 25,000 25,000
--------------------
Total 180,000 155,000
Unamortized discount, net of premium,
on long-term debt (654) (721)
--------------------
Total long-term debt 179,346 154,279
--------------------
Total $422,149 $383,492
====================
<FN>
See the accompanying notes to financial statements.
</TABLE>
25 <PAGE>
<PAGE>
<TABLE>
STATEMENTS OF CONSOLIDATED CASH FLOWS
(Thousands of Dollars)
<CAPTION>
- --------------------------------------------------------------------------
Years Ended September 30 1996 1995 1994
- --------------------------------------------------------------------------
<S> <C> <C> <C>
Operating Activities:
Net Income $32,824 $20,901 $22,217
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 25,037 23,728 19,393
Deferred income taxes and investment
tax credits (10,598) 9,459 508
Other - net 498 679 567
Changes in assets and liabilities:
Accounts receivable - net (11,180) 4,701 (6,208)
Unamortized purchased gas adjustments 36,520 (7,778) 4,280
Deferred purchased gas costs (712) 493 (355)
Accounts payable (432) 945 3,379
Refunds due customers (2,862) (25,672) 29,568
Taxes accrued 1,782 (1,425) (1,690)
Natural gas stored underground (17,140) 6,704 (34,254)
Other assets and liabilities (12,470) (4,529) 6,280
-------------------------------
Net cash provided by operating activities 41,267 28,206 43,685
-------------------------------
Investing Activities:
Construction expenditures (41,205) (45,804) (39,193)
Employee benefit trusts (2,052) 974 1,006
Investments - non-utility 362 (1,290) (1,673)
Other (1,363) (153) (655)
-------------------------------
Net cash used in investing activities (44,258) (46,273) (40,515)
-------------------------------
Financing Activities:
Issuance of first mortgage bonds 25,000 - -
Issuance of short-term debt - net 100 6,000 26,000
Issuance of common stock 2,970 33,380 1,973
Dividends paid (22,046) (20,015) (19,126)
Retirement of first mortgage bonds - - (11,991)
Other (228) (1,331) (144)
-------------------------------
Net cash provided by (used in)
financing activities 5,796 18,034 (3,288)
-------------------------------
Net Decrease in Cash and
Cash Equivalents 2,805 (33) (118)
Cash and Cash Equivalents at Beg. of Year 1,555 1,588 1,706
-------------------------------
Cash and Cash Equivalents at End of Year $ 4,360 $ 1,555 $ 1,588
===============================
Supplemental Disclosure of Cash Paid
During the Year for:
Interest $16,541 $17,742 $15,769
Income taxes 27,478 4,088 11,732
<FN>
See the accompanying notes to financial statements.
</TABLE>
26<PAGE>
<PAGE>
<TABLE>
SCHEDULE OF INCOME TAXES (Note 7)
(Thousands of Dollars)
<CAPTION>
- -------------------------------------------------------------------------
Years Ended September 30 1996 1995 1994
- -------------------------------------------------------------------------
<S> <C> <C> <C>
Included in Statements of
Consolidated Income as:
Utility Operating Expenses:
Federal
Current $23,499 $ 347 $10,286
Deferred (8,465) 8,474 720
Investment tax credit
adjustments - net (348) (350) (352)
State and local
Current 3,930 65 1,708
Deferred (1,268) 1,342 155
-----------------------------
17,348 9,878 12,517
-----------------------------
Off System Sales:
Federal
Current 1,184 - -
Deferred (99) - -
State and local
Current 186 - -
Deferred (16) - -
-----------------------------
1,255 - -
-----------------------------
Miscellaneous Income and Income Deductions:
Federal
Current 180 239 160
Deferred (347) (5) (12)
Investment tax credit
adjustments - net (1) (1) (2)
State and local
Current 17 19 (24)
Deferred (54) (1) (1)
-----------------------------
(205) 251 121
-----------------------------
Total $18,398 $10,129 $12,638
=============================
<FN>
See the accompanying notes to financial statements.
</TABLE>
27<PAGE>
<PAGE>
<TABLE>
SCHEDULE OF INTERIM FINANCIAL INFORMATION
(Unaudited) (Note 10)
(Thousands of Dollars Except Per Share Amounts)
<CAPTION>
- ---------------------------------------------------------------------------
Three Months Ended Dec. 31 March 31 June 30 Sept. 30
- ---------------------------------------------------------------------------
1996
<S> <C> <C> <C> <C>
Utility Operating Revenues $154,981 $246,593 $86,022 $57,220
Utility Operating Income (Loss) 19,689 27,218 3,094 (1,591)
Net Income (Loss) 15,738 24,041 (399) (6,556)
Earnings (Loss) Per Share
of Common Stock
(after preferred dividends) $.90 $1.37 $(.02) $(.37)
<CAPTION>
- ---------------------------------------------------------------------------
Three Months Ended Dec. 31 March 31 June 30 Sept. 30
- ---------------------------------------------------------------------------
1995
<S> <C> <C> <C> <C>
Utility Operating Revenues $122,203 $191,627 $67,598 $50,489
Utility Operating Income (Loss) 13,988 22,463 2,154 (275)
Net Income (Loss) 9,210 18,069 (1,971) (4,407)
Earnings (Loss) Per Share
of Common Stock
(after preferred dividends) $.58 $1.15 $(.12) $(.25)
<FN>
See the accompanying notes to financial statements.
</TABLE>
28<PAGE>
<PAGE>
NOTES TO FINANCIAL STATEMENTS
1. Summary of Significant Accounting Policies
Basis of Consolidation - The consolidated financial statements include
the accounts of the Laclede Gas Company and its subsidiary companies
(Company). The net operating results of the Company's non-utility
subsidiaries, all of which are wholly owned, are included under the caption
"Miscellaneous Income and Income Deductions - Net" in the Statements of
Consolidated Income. Revenues from non-utility subsidiaries are
insignificant. All appropriate intercompany transactions have been
eliminated.
Nature of Operations - Laclede Gas Company is a public utility engaged
in the retail distribution of natural gas. The Company serves an area in
eastern Missouri, with a population of approximately 2.0 million, including
the City of St. Louis, St. Louis County, and parts of eight other counties.
As an adjunct to its gas distribution business, the Company operates
underground natural gas storage fields and is engaged in the transportation
and storage of liquid propane. Since 1968, the Company has also made
investments in some non-utility businesses as part of a diversification
program.
Use of Estimates - The preparation of financial statements in
conformity with generally accepted accounting principles requires management
to make estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amounts of revenues and
expenses during the reporting period. Actual results could differ form
those estimates.
System of Accounts - The accounts of the Company are maintained in
accordance with the uniform system of accounts prescribed by the Missouri
Public Service Commission (MoPSC), which system substantially conforms to
that prescribed by the Federal Energy Regulatory Commission.
Utility Plant, Depreciation and Amortization - Utility plant is stated
at original cost. The cost of additions to utility plant includes
contracted work, direct labor and materials, allocable overheads, and an
allowance for funds used during construction. The costs of units of
property retired, replaced, or renewed are removed from utility plant and
such costs, plus removal costs, less salvage are charged to accumulated
depreciation. Maintenance and repairs of property and replacement and
renewal of items determined to be less than units of property are charged to
operating expenses.
Utility plant, excluding exploration and development, is depreciated
on the straight-line basis at rates based on estimated service lives of the
various classes of property. Annual depreciation in 1996, 1995 and 1994
averaged approximately 3.3%, 3.3% and 2.8%, respectively, of the original
cost of depreciable property. In August 1994, the MoPSC approved a
settlement agreement in the Company's 1994 general rate case which
authorized a net increase in depreciation rates for the Company effective on
September 1, 1994.
29 <PAGE>
<PAGE>
Regulated Operations - The Company accounts for its regulated
operations in accordance with Statement of Financial Accounting Standards
(SFAS) No. 71, "Accounting for the Effects of Certain Types of Regulation".
This statement sets forth the application of generally accepted accounting
principles for those companies whose rates are established by or are subject
to approval by an independent third-party regulator. The provisions of SFAS
No. 71 require, among other things, that financial statements of a regulated
enterprise reflect the actions of regulators, where appropriate. These
actions may result in the recognition of revenues and expenses in time
periods that are different than non-regulated enterprises. When this occurs,
costs are deferred as assets in the balance sheet (regulatory assets) and
recorded as expenses when those amounts are reflected in rates. Also,
regulators can impose liabilities upon a regulated company for amounts
previously collected from customers and for recovery of costs that are
expected to be incurred in the future (regulatory liabilities).
<TABLE>
The following regulatory assets and regulatory liabilities were
reflected in the Consolidated Balance Sheets as of September 30:
<CAPTION>
(Thousands of Dollars) 1996 1995
- --------------------------------------------------------------
<S> <C> <C>
Regulatory Assets:
Amounts due from customers for
future income taxes $32,090 $32,235
Pension costs 3,595 3,514
Unamortized loss on reacquired debt 1,209 1,450
Unamortized purchased gas adjustments - 9,776
Other 260 693
---------------------
Total Regulatory Assets $37,154 $47,668
=====================
Regulatory Liabilities:
Unamortized investment tax credits $ 7,669 $ 8,018
Amounts due to customers for
future income taxes - 294
Purchased gas costs 445 1,157
Unamortized purchased gas adjustments 26,744 -
Other 311 422
---------------------
Total Regulatory Liabilities $35,169 $ 9,891
=====================
</TABLE>
Gas Stored Underground - Inventory of gas in storage is priced on a
last-in, first-out (LIFO) basis. The replacement cost of gas stored
underground for current use at September 30, 1996 and 1995 was less than the
LIFO cost by $9,570,000 and $1,203,000, respectively. The inventory carrying
value has not been reduced to market prices because, pursuant to the
Company's Purchased Gas Adjustment Clause, actual gas costs are recovered in
customer rates.
30 <PAGE>
<PAGE>
Oil & Gas Exploration and Development - The Company uses the full cost
method of accounting for utility exploration and development costs as
ordered by the MoPSC. Under the full cost method, all exploration and
development costs of productive and non-productive wells are capitalized.
Such costs are charged to expense based on oil and gas produced in relation
to total estimated recoverable reserves. Depreciation and amortization
charges amounted to $570,000 in 1996, $907,000 in 1995 and $812,000 in 1994.
Operating Revenues - The Company records revenues from gas sales and
transportation service on the accrual basis which includes estimated amounts
for gas delivered, where applicable, but not yet billed.
Purchased Gas Adjustments and Deferred Account - Pursuant to the
provisions of the Company's Purchased Gas Adjustment (PGA) Clause, increases
or decreases in gas costs are passed on to its customers. The difference
between actual costs incurred and costs recovered through the application of
the PGA is reflected as a deferred charge or credit until September 30, at
which time the balance is classified as a current asset or liability and is
recovered from or credited to customers over an annual period commencing in
December. Previously, such differences were recovered over an annual period
commencing in November. The balance in the current account is amortized as
amounts are reflected in customer billings.
Income Taxes - The Company has elected, for tax purposes only, various
accelerated depreciation provisions of the Internal Revenue Code. In
addition, intangible drilling and unsuccessful exploration costs, and
certain other costs are expensed currently for tax purposes while being
deferred for book purposes. The provision for current income taxes reflects
the tax treatment of these items. The Company records deferred tax
liabilities and assets measured by enacted tax rates for the net tax effect
of all temporary differences between the carrying amounts of assets and
liabilities for financial reporting purposes, and the amounts used for
income tax purposes. Changes in enacted tax rates, if any, will be
reflected by entries to regulatory asset or liability accounts.
The benefit of investment tax credits utilized prior to 1986 has been
deferred and is being amortized in accordance with regulatory treatment over
the useful life of the related property for financial statement purposes.
Cash and Cash Equivalents - For the purpose of the statements of cash
flows, the Company considers all highly liquid debt instruments purchased,
which generally have a maturity of three months or less, to be cash
equivalents. Such instruments are carried at cost, which approximates
market value.
Reclassification - Certain prior-year amounts have been reclassified
to conform to current-year presentation.
Accounting Changes - The Financial Accounting Standards Board has
issued various accounting standards that will become effective at some
future date, including Statement of Financial Accounting Standards (SFAS)
No. 121, "Accounting for the Impairment of Long-Lived Assets and for Long-
Lived Assets to Be Disposed Of" and SFAS No. 125, "Accounting for Stock-
Based Compensation". The Company does not expect the adoption of these
standards to have a material effect on the Company's financial position or
results of operations.
31 <PAGE>
<PAGE>
2. Pension Plans and Other Postemployment Benefits
The Company has non-contributory defined benefit, trusteed forms of
pension plans covering substantially all employees over the age of twenty-
one. Benefits are based on years of service and the employee's compensation
during the last three years of employment. The Company's funding policy is
to contribute an amount not less than the minimum required by government
funding standards, nor more than the maximum deductible amount for federal
income tax purposes. Plan assets consist primarily of corporate and U.S.
government obligations.
Pension costs in 1996, 1995 and 1994 amounted to $815,000,
$(5,692,000) and $1,895,000, respectively, including amounts charged to
construction.
<TABLE>
The net pension costs (credits) include the following components:
<CAPTION>
(Thousands of Dollars) 1996 1995 1994
- ------------------------------------------------------------------
<S> <C> <C> <C>
Service cost - benefits earned
during the period $ 7,780 $ 6,412 $ 6,467
Interest cost on projected
benefit obligation 13,456 13,966 13,132
Actual return on plan assets (22,338) (50,765) 9,849
Net amortization and deferral 1,835 28,184 (27,553)
Regulatory adjustment 82 (3,489) -
-----------------------------
Net pension cost $ 815 $ (5,692) $ 1,895
=============================
</TABLE>
The MoPSC ordered in the 1994 general rate case, effective October 1,
1994, certain pension costs to be recovered on a payment basis up to a
$281,000 allowance, the difference between actual payments and the allowance
to be deferred. The settlement in the Company's 1996 general rate case
ordered the allowance to be changed to $313,000, effective September 1,
1996. The 1996 general rate case also provided for the full recovery, on a
payment basis, of the costs deferred at April 30, 1996. The 1994 general
rate case provided for the elimination of the corridor and a ten-year
amortization period for unrecognized gains and losses. Beginning in 1997,
the amortization period for unrecognized gains and losses will be a five-
year period, as ordered in the 1996 general rate case. Other variances in
net pension cost are primarily attributable to actuarial and investment
experience.
32 <PAGE>
<PAGE>
<TABLE>
The following table sets forth the funded status of the plans and
amounts recognized in the Company's consolidated balance sheets at September
30:
<CAPTION>
(Thousands of Dollars) 1996 1995
- ------------------------------------------------------------------
<S> <C> <C>
Actuarial present value of
benefit obligation:
Vested benefit obligation $120,845 $128,508
===================
Accumulated benefit obligation $142,560 $149,641
===================
Projected benefit obligation $181,799 $187,522
Plan assets at fair value 251,478 256,662
-------------------
Plan assets in excess of
projected benefit obligation 69,679 69,140
Unrecognized net gain (45,974) (51,803)
Unrecognized prior service cost 13,796 14,856
Unrecognized net transition asset (5,605) (7,156)
Minimum liability adjustment (1,794) (2,449)
-------------------
Prepaid pension cost recognized in the
consolidated balance sheets $ 30,102 $ 22,588
===================
</TABLE>
The projected benefit obligation, which is based on a June 30
measurement date, was determined using a weighted-average discount rate of
7.75% for 1996 and 1995, and a weighted-average rate of future compensation
of 4.75% for 1996 and 1995. The expected long-term rate of return on plan
assets was 8.25% for 1996 and 1995.
Pursuant to the provisions of the Company's pension plans, pension
obligations may be settled by lump-sum cash payments. Settlements in 1996
and 1995 resulted in pre-tax gains of approximately $5,024,000 and
$3,937,000, respectively. There were no such gains in 1994.
The cost of the Company's defined contribution plans, which cover
substantially all employees, amounted to $2,022,000, $1,803,000 and
$1,706,000 for the years 1996, 1995 and 1994, respectively.
The Company also provides certain life insurance benefits at
retirement. Medical insurance is available after early retirement until age
65.
State law provides for the recovery in rates of Statement of
Accounting Standards No. 106, "Employers' Accounting for Postretirement
Benefits Other Than Pensions" (OPEB), accrued costs provided that such costs
are funded through an independent, external funding mechanism. The Company
established Voluntary Employees' Beneficiary Association (VEBA) and Rabbi
trusts as its external funding mechanisms. VEBA and Rabbi trusts assets
consist primarily of money market securities. The unrecognized transition
obligation is being amortized over 20 years.
Postretirement benefit costs in 1996, 1995 and 1994 amounted to
approximately $4,608,000, $6,100,000 and $6,063,000, respectively, including
amounts charged to construction.
33<PAGE>
<PAGE>
<TABLE>
The 1996 and 1995 net postretirement benefit costs consisted of the
following components:
<CAPTION>
(Thousands of Dollars) 1996 1995 1994
- -----------------------------------------------------------------
<S> <C> <C> <C>
Service cost - benefits earned
during the period $1,528 $1,568 $1,597
Interest cost on accumulated
postretirement benefit obligation 2,479 2,676 2,767
Actual return on plan assets (129) - -
Amortization of transition obligation 1,267 1,267 1,699
Net amortization and deferral (160) (97) -
Regulatory adjustment (377) 686 -
--------------------------
Net postretirement benefit cost $4,608 $6,100 $6,063
==========================
</TABLE>
<TABLE>
The following table sets forth the funded status of the plans and
amounts recognized in the Company's consolidated balance sheets at
September 30:
<CAPTION>
(Thousands of Dollars) 1996 1995
- -----------------------------------------------------------------
<S> <C> <C>
Accumulated postretirement benefit
obligation (APBO):
Retirees $(15,670) $(19,286)
Active Employees (17,025) (15,162)
-------------------
Total APBO (32,695) (34,448)
Plan assets at fair value 3,235 1,450
-------------------
APBO in excess of plan assets (29,460) (32,998)
Unrecognized transition obligation 21,514 22,781
Unrecognized prior service cost 5,079 5,271
Unrecognized net gain (5,034) (3,479)
-------------------
Accrued postretirement benefit cost $ (7,901) $ (8,425)
===================
</TABLE>
The assumed health care cost trend rate used in measuring the
accumulated postretirement benefit obligation was 8% for 1996, and gradually
decreases each successive year until it reaches 5% in 1998. A one percent
increase in the assumed health care cost trend rate for each year would
increase accumulated postretirement benefit costs as of September 30, 1996
by $977,000 and the sum of the service cost and interest cost by
approximately $212,000. The accumulated postretirement benefit obligation
was determined using a weighted-average discount rate of 7.75% for 1996 and
1995, and a weighted-average rate of future compensation of 4.75% for 1996
and 1995.
The 1994 rate case settlement provided for the deferral, net of any
applicable tax effects, of the difference between the costs funded by the
Company and a $6,100,000 allowance of annualized OPEB costs included in
34<PAGE>
<PAGE>
rates. The settlement of the 1996 general rate case ordered the allowance
to be changed to $4,265,000, effective September 1, 1996. Any such
deferrals will be reflected in rates established in the next general rate
case proceeding.
3. Common Stock and Paid-in Capital
The Company issued 137,913 and 174,604 shares of its common stock
during fiscal years 1996 and 1995, respectively, under its Dividend
Reinvestment and Stock Purchase Plan.
Total shares of common stock outstanding were 17,557,540 at September
30, 1996.
the Company's Shareholder Rights Plan, adopted in 1986, expired on May
1, 1996. The Company decided to keep such protection in place by adopting a
replacement plan. On March 14, 1996, the Company declared a dividend of one
Common Share Purchase Right for each outstanding share of common stock as of
May 1, 1996, each of which common share purchase rights gives the
Rightholder the right to purchase one common share for a purchase price of
$60, subject to adjustment. The rights expire on May 1, 2006, and may be
redeemed by the Company for one cent each at any time before they become
exercisable. The rights will not be exercisable or transferable apart from
the common stock, until ten days after a person or group acquires or obtains
the right to acquire 20% or more of the common stock, or commences or
announces its intention to commence a tender or exchange offer for 20% or
more of the common stock. Following the former event, a right will entitle
its holder to purchase, at the purchase price, the number of shares equal to
the purchase price (initially $60 per share) divided by one-half of the
market price. Alternatively, the Company may exchange each Right for one
share of Company common stock. A total of 17,557,540 rights were
outstanding at September 30, 1996.
Paid-in capital increased $2,804,000 in 1996 primarily due to the
issuance of common stock under the Dividend Reinvestment and Stock Purchase
Plan, partially offset by expenses related to the replacement of the
Company's Shareholder Rights Plan. In 1995, paid-in capital increased
$30,299,000 due to the sale of 1,575,000 shares of common stock through a
public offering and the issuance of common stock under the Dividend
Reinvestment and Stock Purchase Plan.
4. Redeemable Preferred Stock
The preferred stock, which is non-voting except in certain
circumstances, may be redeemed at the option of the Board of Directors. The
redemption price is equal to par of $25.00 a share.
During 1996, 1995, and 1994 no shares of preferred stock were
reacquired.
Any default in a sinking fund payment must be cured before the Company
may pay dividends on or acquire any common stock. Sinking fund requirements
on preferred stock for the five years subsequent to September 30, 1996 are:
1997-1999, none; 2000, $37,000; 2001, $197,000.
5. Long-Term Debt
There are no maturities or sinking fund requirements on long-term debt
for the five years subsequent to September 30, 1996.
In November 1995, the Company issued $25 million of 6 1/2% First
Mortgage Bonds at a cost to the Company of 6.55%. The proceeds of the
issuance were used to reduce outstanding short-term borrowings.
Substantially all of the Company's utility plant is subject to the
liens of its mortgage.
35<PAGE>
<PAGE>
The Company's mortgage contains provisions which restrict retained
earnings from declaration or payment of cash dividends. As of September 30,
1996, approximately $183,700,000 of consolidated retained earnings was free
from such restrictions.
6. Fair Value of Financial Instruments
<TABLE>
The carrying amounts and estimated fair values of the Company's
financial instruments at September 30, 1996 and 1995 are as follows:
<CAPTION>
Carrying Fair
(Thousands of Dollars) Amount Value
- ------------------------------------------------------------------
1996:
<S> <C> <C>
Cash and cash equivalents $ 4,360 $ 4,360
Short-term debt 59,600 59,600
Long-term debt 179,346 185,404
Redeemable preferred stock 1,960 1,797
<CAPTION>
1995:
<S> <C> <C>
Cash and cash equivalents $ 1,555 $ 1,555
Short-term debt 59,500 59,500
Long-term debt 154,279 168,397
Redeemable preferred stock 1,960 1,644
</TABLE>
The carrying amounts for cash and cash equivalents and short-term debt
approximate fair value due to the short maturity of these investments. Fair
value of long-term debt and preferred stock is estimated based on market
prices for similar issues.
7. Income Taxes
Net provisions for income taxes were charged during the years ended
September 30, 1996, 1995 and 1994 as shown on the Schedule of Income Taxes.
The effective income tax rate varied from the federal statutory income tax
rate for each year due to the following:
<TABLE>
<CAPTION>
1996 1995 1994
- ---------------------------------------------------------------------------
<S> <C> <C> <C>
Federal income tax statutory rate 35.0% 35.0% 35.0%
State and local income taxes,
net of federal income tax benefits 3.6 3.0 3.4
Certain expenses capitalized on books
and deducted on tax return (.6) (3.3) (3.0)
Reversal of deferred taxes related to gas costs - - (.1)
Taxes related to prior years (1.4) (1.3) -
Other items - net (.7) (.8) 1.0
----------------------
Effective income tax rate 35.9% 32.6% 36.3%
======================
</TABLE>
36 <PAGE>
<PAGE>
<TABLE>
The significant items comprising the Company's net deferred tax
liability recognized in the consolidated balance sheets as of September 30
are as follows:
<CAPTION>
(Thousands of Dollars) 1996 1995
- ----------------------------------------------------------------------
<S> <C> <C>
Deferred tax assets:
Reserves not currently deductible $15,869 $12,927
Unamortized investment tax credits 4,828 5,048
Other 3,165 2,661
------- -------
Total deferred tax assets 23,862 20,636
------- -------
Deferred tax liabilities:
Relating to utility property 90,185 86,997
Pension 14,782 11,538
Other (7,433) 5,831
------- -------
Total deferred tax liabilities 97,534 104,366
------- -------
Net deferred tax liability 73,672 83,730
Net deferred tax asset (liability) - current 4,477 (167)
------- -------
Net deferred tax liability - non-current $78,149 $83,563
======= =======
</TABLE>
8. Notes Payable and Credit Agreements
The Company has primary lines of bank credit which permit borrowing of
up to $40 million at any time before January 31, 1997. Such borrowings are
on a 90-day basis, renewable from time to time, with no note maturing beyond
June 30, 1997. The borrowings may be repaid at any time without penalty.
The Company anticipates renewal of these primary lines totaling $40 million
in January 1997. These, together with the Company's previously obtained
supplemental line of credit, which aggregated about $50 million through
March 1, 1996, (the supplemental line of credit was increased to $60 million
for one day on November 20, 1995), provided total lines of credit of $90
million for the 1995-1996 heating season. Since cash needs typically
decline at the end of the heating season, the Company reduced the
supplemental line of credit to $15 million from March 1, 1996 through April
1, 1996 and allowed the supplemental line of credit to expire on April 1,
1996. In August 1996, the Company obtained a $60 million supplemental line
of credit which extends until March 1, 1997. The Company plans to increase
the supplemental line of credit to $90 million effective on January 1, 1997,
which would provide total lines of credit of $130 million. The Company
anticipates that the supplemental line will be reduced below $60 million
after March 1, 1997.
Alternatively, the Company has an agreement for the issuance of
commercial paper which is supported by the bank loan lines of credit.
During fiscal year 1996, the Company's short-term borrowing requirements
were met by the sale of commercial paper. As of September 30, 1996, the
Company had $59.6 million in commercial paper outstanding at an average
interest rate of 5.6%.
37 <PAGE>
<PAGE>
9. Commitments and Contingencies
The Company estimates fiscal year 1997 utility construction
expenditures at $39,200,000. The lease agreement covering the Company's
general office space extends through February 2000 with options to renew for
up to 20 additional years. The aggregate rental expense for fiscal years
1996, 1995 and 1994 was $785,000, $780,000 and $770,000, respectively.
Annual minimum rental payments for fiscal years 1997-1999 are $785,000 per
year. The lease agreement provides for an annual rent escalation which is
not determinable as of the balance sheet date; however, the maximum amount
of rental expense increase is $8,800 per year. The Company has other rental
arrangements which provide for minimum rental payments that are relatively
minor. The Company has entered into various contracts which in the
aggregate require it to pay approximately $87 million on an annual basis, at
present rate levels, for the reservation of gas supplies and pipeline
transmission and storage capacity. These costs are recovered from customers
in accordance with the Purchased Gas Adjustment Clause of the Company's
tariff. The contracts have various expiration dates ranging from 1997 to
2001.
A consolidated subsidiary is a general partner in an unconsolidated
partnership which invests in real estate partnerships. The subsidiary and
third parties are jointly and severally liable for the payment of mortgage
loans in the aggregate outstanding amount of approximately $8.1 million
incurred in connection with various real estate ventures. The Company has
no reason to believe that the other principal liable parties will not be
able to meet their proportionate share of these obligations. The Company
further believes that the asset values of the real estate properties are
sufficient to support these mortgage loans.
The Company has a labor agreement, which expires July 31, 1997, with
Locals 5-6 and 5-194 of the Oil, Chemical and Atomic Workers International.
The two unions represent approximately 70% of the Company's workforce.
The Company is subject to various laws and regulations relating to the
environment, which thus far have not had a material effect on the Company's
financial position and results of operations. In the past, the Company
operated various manufactured gas plants which produced by-products and
residuals, including various hydrocarbons. Certain remnants of these
residuals are typically found at former gas manufacturing sites. The United
States Environmental Protection Agency (EPA) and the Company determined that
such residuals were present at one of the Company's former manufactured gas
plant sites located in Shrewsbury, Missouri (the Shrewsbury Site). The
Company and EPA also agreed to a plan under which the Company would perform
certain tests, analyses, and evaluations at the Shrewsbury Site. After
reviewing the results of this investigation, the EPA suggested, and the
Company agreed to perform, a limited removal of some contaminants on small
areas of the site. Subsequently, the Missouri Department of Natural
Resources (MoDNR) suggested some additional possible actions at the site,
most of which the Company also agreed to perform. After the Company's
response to MoDNR's initial suggestions, MoDNR expressed further concerns,
and has suggested further evaluation measures. The Company has contested
these expressions of further concern, and has provided detailed technical
support for the Company's position to the MoDNR and EPA. Currently, the
MoDNR and EPA are considering the Company's response.
At this time, given the lack of final agreement as to whether any
additional actions should be taken, the ultimate costs to be incurred
regarding the Shrewsbury Site remain unclear. If the limited removal
actions agreed to by the Company and EPA are implemented, together with the
initial MoDNR suggested actions, the Company estimates that the overall
38<PAGE>
<PAGE>
approximate costs, including EPA's oversight and other associated legal,
investigation and engineering consulting expenses, will range from $600,000
to $715,000. As of September 30, 1996, $482,000 of such overall costs had
been paid, and an additional $118,000 was reserved by the Company. If the
Company is required to take any additional actions with regard to the site,
the Company may have to incur additional costs, the extent of which cannot
practicably be estimated currently. The Company has notified its insurers
that the Company intends to seek reimbursement from them of its
investigation, remediation, clean-up and defense costs. The Company intends
to seek recovery, if practicable, from any other potentially responsible
parties.
In a separate matter, MoDNR has accepted the Company's application to
place the site of a different former manufactured gas plant located in the
City of St. Louis, Missouri (which site was also used by subsequent owners
as the site of a coke manufacturing facility) in the Missouri environmental
remediation program. Preliminary tests conducted by MoDNR at the site
reflect the presence of coke and gas plant manufacturing wastes, as well as
certain heavy metal wastes. The Company and MoDNR have agreed that the
Company's initial investigation should focus mainly on determining whether
ground water is contaminated and, if so, whether it presents any risks to
receptor populations. The Company currently estimates that the cost of its
investigation, MoDNR oversight costs and associated legal and engineering
consulting costs relative to the site will together approximate $75,000. As
of September 30, 1996, $7,000 had been paid and an additional $68,000 was
reserved on the Company's books. The Company has notified its insurers that
the Company intends to seek reimbursement from them for investigation,
remediation, clean-up and defense costs. The Company has also requested
that other former site owners and/or operators participate in the cost of
any site investigation, but none has yet agreed to do so. The Company plans
to seek proportionate reimbursement of all costs incurred with respect to
this site from such parties and/or any other potentially responsible
parties, to the extent practicable.
The Company is presently unable to evaluate or quantify further the
scope or cost of any environmental response activity with regard to the
above two former manufactured gas plant sites.
As a part of a 1994 rate case settlement, the MoPSC approved an
environmental cost deferral procedure, effective September 1, 1994, for the
Company's use in applying for appropriate rate recovery of various
investigation, remediation and other costs in connection with manufactured
gas plants. In the Company's most recent rate case, the MoPSC approved,
effective September 1, 1996, the continued use of a similar cost deferral
mechanism. This authorization will be null and void if the Company does not
file to further adjust its rates by September 1, 1998; and, in any event the
recovery of costs thus deferred may be challenged in future rate
proceedings.
The Company is involved in litigation, claims, and investigations
arising in the normal course of business. While the results of such
litigation cannot be predicted with certainty, management, after discussion
with counsel, believes the final outcome will not have a material adverse
effect on the consolidated financial position and results of operations
reflected in the financial statements presented herein.
39 <PAGE>
<PAGE>
10. Interim Financial Information (Unaudited)
In the opinion of the Company, the quarterly information presented in
the Schedule of Interim Financial Information for fiscal years 1996 and 1995
includes all adjustments, consisting of normal recurring adjustments
necessary for a fair statement of the results of operations for such
periods. Variations in operations reported on a quarterly basis reflect the
seasonal nature of the Company's business.
Item 9. Changes in and Disagreements on Accounting and Financial
Disclosure
There have been no disagreements on accounting and financial disclosure with
the Company's outside auditors which are required to be disclosed.
Part III
Item 10. Directors and Executive Officers of the Registrant
The information concerning directors required by this item is set forth on
pages 3 through 7 in the Company's proxy statement dated December 20, 1996
and is incorporated herein by reference.
The information concerning executive officers required by this item is
reported in Part I of this Form 10-K.
Item 11. Executive Compensation
The information required by this item is set forth on pages 8 through 17 in
the Company's proxy statement dated December 20, 1996 and is incorporated
herein by reference but the information under the captions "Compensation
Committee Report Regarding Executive Compensation" and "Performance Graph"
on pages 13 through 16 of such proxy statement is expressly NOT incorporated
herein by reference.
Item 12. Security Ownership of Certain Beneficial Owners and Management
Information required by this item is set forth on pages 6 through 7 in the
Company's proxy statement dated December 20, 1996 and is incorporated herein
by reference.
Item 13. Certain Relationships and Related Transactions
There were no transactions required to be disclosed pursuant to this item.
40 <PAGE>
<PAGE>
Part IV
Item 14. Exhibits, Financial Statement Schedules and Reports on
Form 8-K
(a) 1. Consolidated Financial Statements: 1996 10-K Page
For Years Ended September 30, 1996, 1995, and 1994:
Statements of Income 21
Statements of Retained Earnings 22
Statements of Cash Flows 26
Schedule of Income Taxes 27
As of September 30, 1996 & 1995:
Balance Sheets 23-24
Statements of Capitalization 25
For Years Ended 1996 & 1995:
Schedule of Interim Financial Information 28
Notes to Financial Statements 29-40
Independent Auditors' Report 19
Management Report 20
2. Supplemental Schedules
II - Reserves 45
Schedules not included have been omitted because they are not
applicable or the required data has been included in the financial
statements or notes to financial statements.
3. Exhibits
Incorporated herein by reference to Index to Exhibits, page 46.
(b) During the last quarter of fiscal year 1996, no reports on Form 8-K
were required to be filed by the Company.
41 <PAGE>
<PAGE>
(c) Management contracts and compensatory plans or arrangements listed in
the Index to Exhibits required to be filed as exhibits to this form
pursuant to Item 14(c) of this report:
Exhibit No. Description
10.01 - Incentive Compensation Plan of the Company, as
amended.
10.01a - Amendment adopted by the Board of Directors on
July 26, 1990 to the Incentive Compensation Plan.
10.01b - Amendments adopted by the Board of Directors on
August 23, 1990 to the Incentive Compensation Plan.
10.01c - Amendments to Laclede Gas Company Incentive
Compensation Plan, effective January 26, 1995.
10.02 - Senior Officers' Life Insurance Program of the
Company, as amended.
10.02a - Certified copy of resolutions of the Company's
Board of Directors adopted on June 27, 1991
amending the Senior Officers' Life Insurance
Program.
10.02b - Certified copy of resolutions of the Company's
Board of Directors adopted on January 28, 1993
amending the Senior Officers' Life Insurance Program.
10.03 - Employees' Retirement Plan of Laclede Gas Company
Management Employees, effective as of July 1,
1990, as amended.
10.03a - Amendment to the Employees' Retirement Plan of
Laclede Gas Company - Management Employees adopted
by the Board of Directors on September 27, 1990.
10.03b - Amendments dated December 12, 1990 to the
Employees' Retirement Plan of Laclede Gas Company
Management Employees.
10.03c - Amendment to the Employees' Retirement Plan of
Laclede Gas Company - Management Employees dated
January 10, 1994.
10.03d - Amendments to the Employees' Retirement Plan of
Laclede Gas Company - Management Employees dated
July 29, 1994.
10.03e - Amendments to the Employees' Retirement Plan of
Laclede Gas Company - Management Employees dated
February 21, 1995.
10.03f - Amendments to the Employees' Retirement Plan of
Laclede Gas Company - Management Employees dated
March 7, 1995.
10.03g - Amendments to the Employees' Retirement Plan of
Laclede Gas Company - Management Employees dated
September 11, 1995.
10.03h - Amendments to the Employees Retirement Plan of Laclede Gas
Company - Management Employees.
10.04 - Laclede Gas Company Supplemental Retirement
Benefit Plan, as amended and restated effective
July 25, 1991.
10.05 - Laclede Gas Company Salary Deferral Savings Plan,
as amended through February 27, 1992.
42<PAGE>
<PAGE>
10.05a - Amendment to the Company's Salary Deferral Savings
Plan, effective January 31, 1992, adopted by the
Board of Directors on August 27, 1992.
10.05b - Amendment to the Company's Salary Deferral Savings
Plan dated January 10, 1994.
10.05c - Amendments to the Company's Salary Deferral
Savings Plan, dated July 29, 1994.
10.05d - Amendments to the Company's Salary Deferral
Savings Plan effective August 1, 1994 adopted by
the Board of Directors on August 25, 1994.
10.05e - Amendments to the Company's Salary Deferral
Savings Plan dated September 27, 1994.
10.05f - Amendments to the Company's Salary Deferral
Savings Plan dated February 21, 1995.
10.05g - Amendments to the Company's Salary Deferral
Savings Plan dated March 7, 1995.
10.05h - Amendments to the Company's Salary Deferral
Savings Plan dated June 26, 1995.
10.05i - Amendments to the Company's Salary Deferral
Savings Plan dated August 3, 1995.
10.06 - Laclede Gas Company Deferred Compensation Plan for
Non-Employee Directors dated March 26, 1981.
10.06a - First Amendment to the Company's Deferred
Compensation Plan for Non-Employee Directors,
adopted by the Board of Directors on July 26, 1990.
10.06b - Amendment to the Company's Deferred Compensation
Plan for Non-Employee Directors, adopted by the
Board of Directors on August 27, 1992.
10.08 - The Retirement Plan for Non-Employee Directors of
Laclede Gas Company dated January 24, 1985.
10.08a - First Amendment to Retirement Plan for the
Company's Non-Employee Directors, adopted by the
Board of Directors on July 26, 1990.
10.08b - Amendments to the Retirement Plan for Non-Employee
Directors, adopted by the Board of Directors on
January 23, 1992.
10.09 - Salient Features of the Laclede Gas Company Deferred Income
Plan for Directors and Selected Executives, including
amendments adopted by the Board of Directors on
July 26, 1990.
10.09a - Amendment to the Company's Deferred Income Plan for Directors
and Selected Executives, adopted by the Board of Directors on
August 27, 1992.
10.10 - Form of Indemnification Agreement between the Company and its
Directors and Officers.
10.11 - Laclede Gas Company Management Continuity Protection Plan, as
amended, effective at the close of business on January 27,
1994, by the Board of Directors.
10.12 - Laclede Gas Company Restricted Stock Plan for Non-Employee
Directors, effective as of January 25, 1990.
10.12a - Extension and amendment of the Laclede Gas Company
Restricted Stock Plan for Non-Employee Directors adopted by
the Board of Directors on November 17, 1994.
10.14 - Salient Features of the Laclede Gas Company Deferred Income
Plan II for Directors and Selected Executives adopted by the
Board of Directors on September 23, 1993.
43<PAGE>
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
LACLEDE GAS COMPANY
December 20, 1996 By Gerald T. McNeive, Jr.
Gerald T. McNeive, Jr.
Senior Vice President - Finance
and Chief Financial Officer
Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.
Date Signature Title
12/19/96 Robert C. Jaudes Chairman of the Board,
Robert C. Jaudes President and Chief Executive
Officer (Principal Executive
Officer)
12/19/96 Gerald T. McNeive, Jr. Senior Vice President -
Gerald T. McNeive, Jr. Finance and Chief Financial
Officer (Principal Financial
and Accounting Officer)
12/19/96 Andrew B. Craig, III Director
Andrew B. Craig, III
12/19/96 Richard E. Beumer Director
Richard E. Beumer
12/19/96 Henry Givens, Jr. Director
Henry Givens, Jr.
12/19/96 C. Ray Holman Director
C. Ray Holman
12/19/96 Mary Ann Krey Director
Mary Ann Krey
12/19/96 William E. Nasser Director
William E. Nasser
_______________ Director
Robert P. Stupp
12/19/96 H. Edwin Trusheim Director
H. Edwin Trusheim
44 <PAGE>
<PAGE>
<TABLE>
SCHEDULE II
LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES
RESERVES
FOR THE YEARS ENDED SEPTEMBER 30, 1996, 1995 AND 1994
<CAPTION>
- ---------------------------------------------------------------------------
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
BALANCE AT ADDITIONS CHARGED DEDUCTIONS BALANCE
BEGINNING TO TO OTHER FROM AT CLOSE
DESCRIPTION OF PERIOD INCOME ACCOUNTS RESERVES OF PERIOD
- ---------------------------------------------------------------------------
(Thousands of Dollars)
YEAR ENDED
SEPTEMBER 30, 1996:
<S> <C> <C> <C> <C> <C>
DOUBTFUL ACCOUNTS $ 5,189 $7,072 $2,904 (a) $7,181 (b) $ 7,984
====================================================
MISCELLANEOUS:
Injuries and
property damage $ 3,598 $1,675 $ - $1,618 (c) $ 3,655
Deferred compensation 7,547 1,505 (196) 816 8,040
----------------------------------------------------
TOTAL $11,145 $3,180 $ (196) $2,434 $11,695
====================================================
YEAR ENDED
SEPTEMBER 30, 1995:
DOUBTFUL ACCOUNTS $ 4,943 $6,040 $3,397 (a) $9,191 (b) $ 5,189
====================================================
MISCELLANEOUS:
Injuries and
property damage $ 4,070 $1,708 $ - $2,180 (c) $ 3,598
Deferred compensation 7,175 1,079 30 737 7,547
----------------------------------------------------
TOTAL $11,245 $2,787 $ 30 $2,917 $11,145
====================================================
YEAR ENDED
SEPTEMBER 30, 1994:
DOUBTFUL ACCOUNTS $ 7,704 $2,818 $2,842 (a) $8,421 (b) $ 4,943
====================================================
MISCELLANEOUS:
Injuries and
property damage $ 3,684 $1,657 $ - $1,271 (c) $ 4,070
Deferred compensation 6,777 1,010 - 612 7,175
Equalization group
insurance premium 4,754 - - 4,754 -
----------------------------------------------------
TOTAL $15,215 $2,667 $ - $6,637 $11,245
====================================================
<FN>
(a) Accounts reinstated, cash recoveries, etc.
(b) Accounts written off.
(c) Claims settled, less reimbursements from insurance companies.
</TABLE>
45 <PAGE>
<PAGE>
INDEX TO EXHIBITS
Exhibit
No.
3.01(i)* - Articles of Incorporation, as of February 11, 1994;
filed as Exhibit 4(a) to the Company's Form S-3
Registration Statement No. 33-52357.
3.01(ii)* - By-Laws of the Company effective January 26, 1995;
filed as Exhibit 4.2 to the Company's Registration
Statement No. 33-58757.
4.01* - Mortgage and Deed of Trust, dated as of February 1,
1945; filed as Exhibit 7-A to Registration Statement
No. 2-5586.
4.02* - Fourteenth Supplemental Indenture, dated as of
October 26, 1976; filed on June 26, 1979 as Exhibit b-4
to Registration Statement No. 2-64857.
4.03* - Seventeenth Supplemental Indenture, dated as of May 15,
1988; filed as Exhibit 28(a) to the Registration
Statement No. 33-38413.
4.04* - Eighteenth Supplemental Indenture, dated as of
November 15, 1989; filed as Exhibit 28(b) to the
Registration Statement No. 33-38413.
4.05* - Nineteenth Supplemental Indenture, dated as of May 15,
1991; filed on May 16, 1991 as Exhibit 4.01 to the
Company's Form 8-K (File No. 1-1822).
4.06* - Twentieth Supplemental Indenture, dated as of
November 1, 1992; filed on November 4, 1992 as Exhibit
4.01 to the Company's Form 8-K (File No. 1-1822).
4.07* - Twenty-First Supplemental Indenture, dated as of May 1,
1993; filed on May 13, 1993 as Exhibit 4.01 to the
Company's Form 8-K (File No. 1-1822).
4.08* - Twenty-Second Supplemental Indenture dated as of
November 15, 1995; filed on December 8, 1995 as Exhibit
4.01 to the Company's Form 8-K (File No. 1-1822).
4.09* - Laclede Gas Company Board of Directors' Resolution dated
August 28, 1986 which generally provides that the Board
may delegate its authority in the adoption of certain
employee benefit plan amendments to certain designated
Executive Officers; filed as Exhibit 4.12 to the
Company's 10-K for the fiscal year ended September 30,
1991 (File No. 1-1822).
4.09a* - Laclede Gas Company Board of Directors' Resolutions
dated August 25, 1988, which generally provide for
certain amendments to the Company's Wage Deferral
Savings Plan and Salary Deferral Savings Plan and that
certain Officers are authorized to execute such
amendments; filed as Exhibit 4.12g to the Company's 10-K
for the fiscal year ended September 30, 1988 (File No.
1-1822).
* Incorporated herein by reference and made a part hereof.
46<PAGE>
<PAGE>
INDEX TO EXHIBITS
Exhibit
No.
4.10* - Laclede Gas Company Wage Deferral Savings Plan,
incorporating amendments through December 12, 1990;
filed as Exhibit 4.13 to the Company's 10-K for the
fiscal year ended September 30, 1991 (File No. 1-1822).
4.10a* - Amendments to the Company's Wage Deferral and Salary
Deferral Savings Plans, effective May 1, 1992, adopted
by the Board of Directors on February 27, 1992; filed as
Exhibit 4.13 to the Company's 10-Q for the fiscal
quarter ended March 31, 1992 (File No. 1-1822).
4.10b* - Amendment to the Company's Wage Deferral Savings Plan,
effective August 1, 1992, adopted by the Board of
Directors on August 27, 1992; filed as Exhibit 4.13b to
the Company's 10-K for the fiscal year ended
September 30, 1992 (File No. 1-1822).
4.10c* - Amendments to the Company's Wage Deferral Savings Plan
dated July 29, 1994; filed as Exhibit 4.09c to the
Company's 10-K for the fiscal year ended September 30,
1994 (File No. 1-1822).
4.10d* - Amendments to the Company's Wage Deferral Savings Plan
effective August 1, 1994 and adopted by the Board of
Directors August 25, 1994; filed as Exhibit 4.09d to
the Company's 10-K for the fiscal year ended
September 30, 1994 (File No. 1-1822).
4.10e* - Amendments to the Company's Wage Deferral Savings Plan
dated February 21, 1995; filed as Exhibit 4.1 to the
Company's 10-Q for the fiscal quarter ended March 31,
1995 (File No. 1-1822).
4.10f* - Amendments to the Company's Wage Deferral Savings Plan
dated March 7, 1995; filed as Exhibit 4.2 to the
Company's 10-Q for the fiscal quarter ended March 31,
1995 (File No. 1-1822).
4.10g* - Amendments to the Laclede Gas Company Wage Deferral
Savings Plan dated June 26, 1995; filed as Exhibit 4.1
to the Company's 10-Q for the fiscal quarter ended
June 30, 1995 (File No. 1-1822).
4.11* - Missouri Natural Gas Division of the Laclede Gas Company
Dual Savings Plan incorporating amendments through
December 12, 1990; filed as Exhibit 4.01 to the
Company's 10-Q for the fiscal quarter ended December 31,
1990 (File No. 1-1822).
* Incorporated herein by reference and made a part hereof.
47<PAGE>
<PAGE>
INDEX TO EXHIBITS
Exhibit
No.
4.11a* - Amendment to the Missouri Natural Gas Division of
Laclede Gas Company Dual Savings Plan effective
April 11, 1993, adopted by the Board of Directors on
August 26, 1993; filed as Exhibit 4.10a to the Company's
10-K for the fiscal year ended September 30, 1993 (File
No. 1-1822).
4.11b* - Amendments to the Missouri Natural Gas Division of
Laclede Gas Company Dual Savings Plan dated July 29,
1994; filed as Exhibit 4.10b to the Company's 10-K for
the fiscal year ended September 30, 1994 (File No.
1-1822).
4.11c* - Amendment dated October 27, 1994 to the Missouri
Natural Gas Division of Laclede Gas Company Dual Savings
Plan; filed as Exhibit 4.1 to the Company's 10-Q for the
fiscal quarter ended December 31, 1994 (File No. 1-1822).
4.11d* - Amendment dated November 21, 1994 to the Missouri
Natural Gas Division of Laclede Gas Company Dual Savings
Plan; filed as Exhibit 4.2 to the Company's 10-Q for the
fiscal quarter ended December 31, 1994 (File No. 1-1822).
4.11e* - Amendments to the Missouri Natural Gas Division of
Laclede Gas Company Dual Savings Plan dated February 21,
1995; filed as Exhibit 4.3 to the Company's 10-Q for the
fiscal quarter ended March 31, 1995 (File No. 1-1822).
4.11f* - Amendments to the Missouri Natural Gas Division of
Laclede Gas Company Dual Savings Plan dated March 7,
1995; filed as Exhibit 4.4 to the Company's 10-Q for the
fiscal quarter ended March 31, 1995 (File No. 1-1822).
4.11g* - Amendments to the Missouri Natural Gas Division of
Laclede Gas Company Dual Savings Plan adopted by the
Laclede Gas Company Board of Directors on May 25, 1995;
filed as Exhibit 4.2 to the Company's 10-Q for the
fiscal quarter ended June 30, 1995 (File No. 1-1822).
4.11h* - Amendments to the Missouri Natural Gas Division of
Laclede Gas Company Dual Savings Plan dated June 26,
1995; filed as Exhibit 4.3 to the Company's 10-Q for the
fiscal quarter ended June 30, 1995 (File No. 1-1822).
4.11i* - Amendments to the Missouri Natural Gas Division of
Laclede Gas Company Dual Savings Plan dated August 3,
1995; filed as Exhibit 4.10i to the Company's 10-K for
the fiscal year ended September 30, 1995 (File No.
1-1822).
4.12* - Rights Agreement dated as of April 3, 1996; filed on
April 3, 1996 as Exhibit 1 to the Company's Form 8-A
(File No. 1-1822).
* Incorporated herein by reference and made a part hereof.
48<PAGE>
<PAGE>
INDEX TO EXHIBITS
Exhibit
No.
10.01* - Incentive Compensation Plan of the Company, as amended;
filed as Exhibit 10.03 to the Company's 10-K for the
fiscal year ended September 30, 1989 (File No. 1-1822).
10.01a* - Amendment adopted by the Board of Directors on July 26,
1990 to the Incentive Compensation Plan; filed as
Exhibit 10.02a to the Company's 10-K for the fiscal
year ended September 30, 1990 (File No. 1-1822).
10.01b* - Amendments adopted by the Board of Directors on
August 23, 1990 to the Incentive Compensation Plan;
filed as Exhibit 10.02b to the Company's 10-K for the
fiscal year ended September 30, 1990 (File No. 1-1822).
10.01c* - Amendments to Laclede Gas Company Incentive Compensation
Plan, effective January 26, 1995; filed as Exhibit 10.3
to the Company's 10-Q for the fiscal quarter ended
March 31, 1995 (File No. 1-1822).
10.02* - Senior Officers' Life Insurance Program of the Company,
as amended; filed as Exhibit 10.03 to the Company's 10-K
for the fiscal year ended September 30, 1990 (File
No. 1-1822).
10.02a* - Certified copy of resolutions of the Company's Board of
Directors adopted on June 27, 1991 amending the Senior
Officers' Life Insurance Program; filed as Exhibit 10.01
to the Company's 10-Q for the fiscal quarter ended
June 30, 1991 (File No. 1-1822).
10.02b* - Certified copy of resolutions of the Company's Board of
Directors adopted on January 28, 1993 amending the
Senior Officers' Life Insurance Program; filed as
Exhibit 10.03 to the Company's 10-Q for the fiscal
quarter ended March 31, 1993 (File No. 1-1822).
10.03* - Employees' Retirement Plan of Laclede Gas Company -
Management Employees, effective as of July 1, 1990, as
amended; filed as Exhibit 10.01 to the Company's 10-Q
for the fiscal quarter ended June 30, 1990 (File
No. 1-1822).
10.03a* - Amendment to the Employees' Retirement Plan of Laclede
Gas Company - Management Employees adopted by the Board
of Directors on September 27, 1990; filed as
Exhibit 10.04a to the Company's 10-K for the fiscal year
ended September 30, 1990 (File No. 1-1822).
10.03b* - Amendments dated December 12, 1990 to the Employees'
Retirement Plan of Laclede Gas Company - Management
Employees; filed as Exhibit 10.04b to the Company's 10-K
for the fiscal year ended September 30, 1990 (File
No. 1-1822).
* Incorporated herein by reference and made a part hereof.
49<PAGE>
<PAGE>
INDEX TO EXHIBITS
Exhibit
No.
10.03c* - Amendment to the Employees' Retirement Plan of Laclede
Gas Company - Management Employees dated January 10,
1994; filed as Exhibit 10.01 to the Company's 10-Q for
the fiscal quarter ended December 31, 1993 (File No.
1-1822).
10.03d* - Amendments to the Employees' Retirement Plan of Laclede
Gas Company - Management Employees dated July 29, 1994;
filed as Exhibit 10.3d to the Company's 10-K for the
fiscal year ended September 30, 1994 (File No. 1-1822).
10.03e* - Amendments to the Employees' Retirement Plan of Laclede
Gas Company - Management Employees dated February 21,
1995; filed as Exhibit 10.4 to the Company's 10-Q for
the fiscal quarter ended March 31, 1995 (File No.
1-1822).
10.03f* - Amendments to the Employees' Retirement Plan of Laclede
Gas Company - Management Employees dated March 7, 1995;
filed as Exhibit 10.5 to the Company's 10-Q for the
fiscal quarter ended March 31, 1995 (File No. 1-1822).
10.03g* - Amendments to the Employees' Retirement Plan of Laclede
Gas Company - Management Employees dated September 11,
1995; filed as Exhibit 10.03g to the Company's 10-K for
the fiscal year ended September 30, 1995 (File No.
1-1822).
10.03h - Amendments to the Employees' Retirement Plan of Laclede
Gas Company - Management Employees dated August 14, 1996.
10.04* - Laclede Gas Company Supplemental Retirement Benefit
Plan, as amended and restated effective July 25, 1991;
filed as Exhibit 10.05 to the Company's 10-K for the
fiscal year ended September 30, 1991 (File No. 1-1822).
10.04a* - Trust Agreement with Boatmen's Trust Company, dated
September 4, 1990; filed as Exhibit 10.05c to the
Company's 10-K for the fiscal year ended September 30,
1990 (File No. 1-1822).
10.04b* - First Amendment to Laclede Gas Company Trust Agreement
dated as of September 4, 1990, adopted by the Board of
Directors on September 23, 1993; filed as Exhibit
10.05(b) to the Company's 10-K for the fiscal year ended
September 30, 1993 (File No. 1-1822).
10.05* - Laclede Gas Company Salary Deferral Savings Plan, as
amended through February 27, 1992; filed as Exhibit
10.08 to the Company's 10-Q for the fiscal quarter ended
March 31, 1992 (File No. 1-1822).
10.05a* - Amendment to the Company's Salary Deferral Savings Plan,
effective January 31, 1992, adopted by the Board of
Directors on August 27, 1992; filed as Exhibit 10.08a to
the Company's Form 10-K for the fiscal year ended
September 30, 1992 (File No. 1-1822).
* Incorporated herein by reference and made a part hereof.
50 <PAGE>
<PAGE>
INDEX TO EXHIBITS
Exhibit
No.
10.05b* - Amendment to the Company's Salary Deferral Savings Plan
dated January 10, 1994; filed as Exhibit 10.02 to the
Company's 10-Q for the fiscal quarter ended December 31,
1993 (File No. 1-1822).
10.05c* - Amendments to the Company's Salary Deferral Savings
Plan, dated July 29, 1994; filed as Exhibit 10.05c to
the Company's 10-K for the fiscal year ended
September 30, 1994 (File No. 1-1822).
10.05d* - Amendments to the Company's Salary Deferral Savings Plan
effective August 1, 1994 adopted by the Board of
Directors on August 25, 1994; filed as Exhibit 10.05d
to the Company's 10-K for the fiscal year ended
September 30, 1994 (File No. 1-1822).
10.05e* - Amendments to the Company's Salary Deferral Savings Plan
dated September 27, 1994; filed as Exhibit 10.05e to the
Company's 10-K for the fiscal year ended September 30,
1994 (File No. 1-1822).
10.05f* - Amendments to the Company's Salary Deferral Savings
Plan dated February 21, 1995; filed as Exhibit 10.1 to
the Company's 10-Q for the fiscal quarter ended
March 31, 1995 (File No. 1-1822).
10.05g* - Amendments to the Company's Salary Deferral Savings
Plan dated March 7, 1995; filed as Exhibit 10.2 to the
Company's 10-Q for the fiscal quarter ended March 31,
1995 (File No. 1-1822).
10.05h* - Amendments to the Company's Salary Deferral Savings Plan
dated June 26, 1995; filed as Exhibit 10.1 to the
Company's 10-Q for the fiscal quarter ended June 30, 1995
(File No. 1-1822).
10.05i* - Amendments to the Company's Salary Deferral Savings
Plan dated August 3, 1995; filed as Exhibit 10.05 to the
Company's 10-K for the fiscal year ended September 30,
1995 (File No. 1-1822).
10.06* - Laclede Gas Company Deferred Compensation Plan for
Non-Employee Directors dated March 26, 1981; filed as
Exhibit 10.12 to the Company's 10-K for the fiscal year
ended September 30, 1989 (File No. 1-1822).
10.06a* - First Amendment to the Company's Deferred Compensation
Plan for Non-Employee Directors, adopted by the Board of
Directors on July 26, 1990; filed as Exhibit 10.09a to
the Company's 10-K for the fiscal year ended
September 30, 1990 (File No. 1-1822).
* Incorporated herein by reference and made a part hereof.
51<PAGE>
<PAGE>
INDEX TO EXHIBITS
Exhibit
No.
10.06b* - Amendment to the Company's Deferred Compensation Plan
for Non-Employee Directors, adopted by the Board of
Directors on August 27, 1992; filed as Exhibit 10.09b
to the Company's Form 10-K for the fiscal year ended
September 30, 1992 (File No. 1-1822).
10.07* - Agency Agreement Between Laclede Gas Company and
Mississippi River Transmission Corporation dated
August 26, 1993; filed as Exhibit 10.10 to the Company's
10-K for the fiscal year ended September 30, 1993 (File
No. 1-1822).
10.07a - Agency Agreement between Laclede Gas Company and
Mississippi River Transmission Corporation dated
September 20, 1996 and effective November 1, 1996.
10.07b* - Propane sales contract between Phillips 66 Company and
Laclede Pipeline Company, dated February 2, 1989; filed
as Exhibit 10.10d to the Company's 10-K for the fiscal
year ended September 30, 1990 (File No. 1-1822).
10.07c* - Amendment, dated August 6, 1992, to Propane Sales
Contract between the Company and Phillips 66 Company;
filed as Exhibit 10.10c to the Company's Form 10-K for
the fiscal year ended September 30, 1992 (File
No. 1-1822).
10.08* - The Retirement Plan for Non-Employee Directors of
Laclede Gas Company dated January 24, 1985; filed as
Exhibit 10.01 to the Company's 10-Q for the fiscal
quarter ended March 31, 1990 (File No. 1-1822).
10.08a* - First Amendment to Retirement Plan for the Company's
Non-Employee Directors, adopted by the Board of
Directors on July 26, 1990; filed as Exhibit 10.11a to
the Company's 10-K for the fiscal year ended
September 30, 1990 (File No. 1-1822).
10.08b* - Amendments to the Retirement Plan for Non-Employee
Directors, adopted by the Board of Directors on
January 23, 1992; filed as Exhibit 10.11 to the
Company's 10-Q for the fiscal quarter ended March 31,
1992 (File No. 1-1822).
10.09* - Salient Features of the Laclede Gas Company Deferred
Income Plan for Directors and Selected Executives,
including amendments adopted by the Board of Directors
on July 26, 1990; filed as Exhibit 10.12 to the
Company's 10-K for the fiscal year ended September 30,
1991 (File No. 1-1822).
* Incorporated herein by reference and made a part hereof.
52<PAGE>
<PAGE>
INDEX TO EXHIBITS
Exhibit
No.
10.09a* - Amendment to the Company's Deferred Income Plan for
Directors and Selected Executives, adopted by the Board
of Directors on August 27, 1992; filed as Exhibit 10.12a
to the Company's Form 10-K for the fiscal year ended
September 30, 1992 (File No. 1-1822).
10.10* - Form of Indemnification Agreement between the Company
and its Directors and Officers; filed as Exhibit 10.13
to the Company's 10-K for the fiscal year ended
September 30, 1990 (File No. 1-1822).
10.11* - Laclede Gas Company Management Continuity Protection
Plan, as amended, effective at the close of business on
January 27, 1994, by the Board of Directors; filed as
Exhibit 10.1 to the Company's 10-Q for the fiscal
quarter ended March 31, 1994 (File No. 1-1822).
10.12* - Laclede Gas Company Restricted Stock Plan for
Non-Employee Directors, effective as of January 25,
1990; filed as Exhibit 10.03 to the Company's 10-Q for
the fiscal quarter ended March 31, 1990 (File No.
1-1822).
10.12a* - Extension and amendment of the Laclede Gas Company
Restricted Stock Plan for Non-Employee Directors adopted
by the Board of Directors on November 17, 1994; filed as
Exhibit 10.1 to the Company's 10-Q for the quarter ended
December 31, 1994 (File No. 1-1822).
10.13* - Laclede Gas Company Trust Agreement with Boatmen's Trust
Company, dated December 7, 1989; filed as Exhibit 10.16
to the Company's 10-K for the fiscal year ended
September 30, 1990 (File No. 1-1822).
10.13a* - First Amendment to Laclede Gas Company Trust Agreement,
adopted by the Board of Directors on July 26, 1990;
filed as Exhibit 10.16a to the Company's 10-K for the
fiscal year ended September 30, 1990 (File No. 1-1822).
10.13b* - Second Amendment to Laclede Gas Company Trust Agreement
dated as of December 7, 1989, adopted by the Board of
Directors on September 23, 1993; filed as Exhibit 10.16b
to the Company's 10-K for the fiscal year ended
September 30, 1993 (File No. 1-1822).
10.14* - Salient Features of the Laclede Gas Company Deferred
Income Plan II for Directors and Selected Executives
adopted by the Board of Directors on September 23, 1993;
filed as Exhibit 10.17 to the Company's 10-K for the
fiscal year ended September 30, 1993 (File No. 1-1822).
10.15* - January 24, 1996 line of credit agreement with
Mercantile Bank of St. Louis, National Association;
filed as Exhibit 10.1 to the Company's 10-Q for the
fiscal quarter ended March 31, 1996 (File No. 1-1822).
* Incorporated herein by reference and made a part hereof.
53<PAGE>
<PAGE>
INDEX TO EXHIBITS
Exhibit
No.
10.16* - January 16, 1996 line of credit agreement with The
Boatmen's National Bank of St. Louis; filed as Exhibit
10.4 to the Company's 10-Q for the fiscal quarter ended
March 31, 1996 (File No. 1-1822).
10.17* - January 16, 1996 line of credit agreement with Commerce
Bank, N.A.; filed as Exhibit 10.3 to the Company's 10-Q
for the fiscal quarter ended March 31, 1996 (File No.
1-1822).
10.18* - January 16, 1996 line of credit agreement with Chemical
Bank; filed as Exhibit 10.2 to the Company's 10-Q for
the fiscal quarter ended March 31, 1996 (File No.
1-1822).
10.19 - Supplemental Line of Credit Agreement dated August 19,
1996 among Laclede Gas Company, The Chase Manhattan
Bank, The Boatmen's National Bank of St. Louis, and
Mercantile Bank of St. Louis National Association.
12 - Ratio of Earnings to Fixed Charges.
21 - Subsidiaries of the Registrant.
23 - Consent of Independent Public Accountants.
27 - Financial Data Schedule UT
* Incorporated herein by reference and made a part hereof.
54
Exhibit 10.03h
Date: August 14, 1996
Robert C. Jaudes (as Chairman of the Board, President and Chief
Executive Officer of Laclede Gas Company), and Gerald T. McNeive, Jr. (as
Senior Vice President - Finance of Laclede Gas Company), pursuant to
resolutions adopted by the Board of Directors on August 28, 1986, which
resolutions, among other things, granted to any two executive officers who
hold one of the following offices: Chairman of the Board; President;
Executive Vice President; or Senior Vice President; the authority to amend
any or all of the benefit plans and/or related trust agreements of the
Company (collectively the "Plans") to the extent such amendments deal with
changes necessary or appropriate: (1) to comply with, or obtain the benefit
of, applicable laws and/or regulations, as amended from time to time; (2) to
reflect minor or routine administrative factors; (3) to clarify the meaning
of any of the provisions of the Plans; and/or (4) to evidence changes in
then existing Plans to reflect the interrelationship thereof with newly
adopted Plans or amendments to Plans, which newly adopted Plans or
amendments affect the terms of such other then existing Plans; do hereby
amend the Employees' Retirement Plan of Laclede Gas Company - Management
Employees as set forth in the attached exhibit, such amendment to be
effectuated and evidenced by our signatures on said exhibit.
55<PAGE>
<PAGE>
AMENDMENTS TO THE EMPLOYEES' RETIREMENT PLAN OF
LACLEDE GAS COMPANY - MANAGEMENT EMPLOYEES
-----------------------------------------------
1. The first and second sentences of Section 1.1.10. are amended,
effective, March 6, 1979, to read as follows:
"Normal Compensation" for any Employee during any period means the
wages, salary or commissions actually received by him for working
time during such period plus any salary amounts deferred by said
Employee under the Laclede Gas Company Salary Deferral Savings Plan,
as the same may be hereafter amended, supplemented or replaced, but
exclusive of any profit sharing distributions or any other special
payments. "Normal Compensation" shall include any compensation paid
for overtime, sick leave, vacation or holiday allowances, or civic
duty allowance.
2. Section 3.5 is amended in its entirety, effective October 1, 1996, to
read as follows:
Section 3.5 - Transfers; Total Accrued Benefit
----------------------------------------------
If an Employee has Years of Credited Service under this Plan and the
Contract Plan, his total Accrued Benefit is equal to the sum of A.
plus B.:
A. For each Year of Credited Service under this Plan, the Accrued
Benefit defined in Section 3.4 of this Plan on the basis of the
Employee's employment history through the last day he or she is
an Employee as defined in Section 1.1.8. of this Plan or, if
later, the last day he or she is an "Employee" as defined in
Section 1.1.8. of the Contract Plan.
B. For each "Year of Credited Service" under the Contract Plan,
earned before transfer to the Management Plan, the additional
Accrued Benefit that would have been determined under Section
3.4 of this Plan if such Contract Plan "Years of Credited
Service" had been Management Plan Years of Credited Service.
For purposes of this Section 3.5, Normal Compensation used to
determine the Accrued Benefit defined in Section 3.4 of this Plan
shall be modified to exclude compensation for overtime for the period
in which the Employee was an "Employee" as defined in Section 1.1.8.
of the Contract Plan.
ROBERT C. JAUDES
-------------------------------------------
Title: Chairman of the Board, President
and Chief Executive Officer
GERALD T. MCNEIVE, JR.
------------------------------------------
Title: Senior Vice President - Finance
56
Exhibit 10.07a
AGENCY AGREEMENT
Between
Laclede Gas Company and
Mississippi River Transmission Corporation
This Agency Agreement is made this 20th day of September, 1996, by and
between Laclede Gas Company ("Laclede"), principal, and Mississippi River
Transmission Corporation ("MRT"), agent (collectively, Laclede and MRT are
referred to herein as "the parties").
WHEREAS, Laclede is a local distribution company engaged in the retail
distribution of natural gas in the City of St. Louis, St. Louis County, and
eight other counties in Eastern Missouri; and
WHEREAS, MRT is an interstate pipeline company engaged in the
transportation of natural gas in interstate commerce; and
WHEREAS, MRT and Laclede have operated under an Agency Agreement dated
August 26, 1993 (such Agency Agreement, as heretofore amended, being
hereinafter called the "Prior Agency Agreement") since the advent of Order
636 Services on the MRT pipeline system; and WHEREAS, MRT and Laclede
mutually agree to terminate the Prior Agency Agreement, such termination to
be effective as of October 31, 1996; and
WHEREAS, MRT is willing to continue to act as Laclede's agent and
Laclede is willing to appoint MRT as such agent pursuant to the terms and
conditions of this Agency Agreement, and the parties in that regard desire
to replace the prior Agency Agreement with this Agency Agreement, effective
as of November 1, 1996.
57
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<PAGE>
NOW THEREFORE, for good and valuable consideration, the receipt and
adequacy of which is hereby acknowledged, and in consideration of the
promises and mutual covenants and agreements contained herein, Laclede and
MRT agree as follows:
ARTICLE I
Appointment of Agent
Laclede hereby appoints MRT as its exclusive agent for the purposes
set forth in Article II of this Agency Agreement. MRT hereby accepts the
appointment and agrees to act as Agent for these purposes.
Laclede shall be the purchaser under all gas purchase contracts which
MRT administers under this Agency Agreement and shall have title to all gas
transported or stored under its transportation and storage agreements with
MRT or any other party.
ARTICLE II
Responsibilities of Agent
2.1 As agent for Laclede, MRT shall, at Laclede's option, --
(a) assist Laclede in the acquisition and sale of natural gas
supplies as requested from time to time by Laclede,
including but not limited to advising and assisting
Laclede in locating natural gas purchase and sales
opportunities, negotiating supply arrangements, and
preparing the documents necessary in the administration
of Laclede's gas supply portfolio;
(b) administer Laclede's gas supply portfolio, including but
not limited to making nominations, submitting notices,
and, receipt, verification and payment of invoices;
2
58<PAGE>
<PAGE>
(c) administer Laclede's transportation and storage
agreements with MRT or any other pipeline, including but
not limited to making nominations, resolving imbalances,
submitting notices, and, receipt, verification and
payment of invoices;
(d) assist in the training of Laclede personnel to perform
any of the functions listed above; and/or
(e) perform such other duties respecting the acquisition,
management, transportation, and storage related to
Laclede's gas supply portfolio as Laclede shall from time
to time request.
2.2 Subject to the provisions of Article III, the responsibility to
respond to Operational Flow Orders, System Protection Warnings, and System
Integrity Alerts issued by MRT or any upstream pipeline company rests with
MRT. Whenever MRT receives notice of any such order, warning or alert, MRT
shall promptly advise Laclede of such notice and MRT's response or intended
response thereto.
2.3 MRT shall have no authority to cancel, extend, modify or enter
into any transportation or storage agreement, or any other agreement on
Laclede's behalf, nor shall MRT knowingly take any action that would result
in the assessment of a penalty under any contract or MRT's FERC tariff,
without Laclede's express written consent.
2.4 When acting as agent for Laclede under this Agreement, MRT shall
at all times acknowledge that it is acting as agent for Laclede.
2.5 MRT shall at all times separately administer and account for its
actions taken on behalf of Laclede under this Agreement, regardless of
whether it aggregates the rights and obligations of Laclede under gas
supply, transportation or storage agreements with those of other shippers.
3
59 <PAGE>
<PAGE>
2.6 MRT shall at all times act within the scope of the powers
expressly given it under this Agreement, and shall at no time, by its
actions or otherwise, represent that its authority as agent for Laclede is
different from or in excess of the authority provided in this Agreement.
2.7 MRT agrees that, in acting as agent for Laclede pursuant to this
Agreement, it shall at all times act in a fiduciary capacity for Laclede
and, accordingly, shall meet the fiduciary standards of loyalty, care and
candor.
2.8 MRT commits to continue the full participation of its Gas Control
Department in the performance of its agency responsibilities hereunder.
2.9 MRT shall provide all of its obligations, responsibilities and
services hereunder including, without limitation, the obligations,
responsibilities and services related to the pipeline Gas Control function
from a location based in the St. Louis metropolitan area during the term of
this Agreement.
ARTICLE III
Responsibilities of Principal
As principal, and purchaser and signatory under the gas purchase
contracts, transportation and storage agreements which are the subject of
this Agency Agreement, Laclede shall --
(a) be responsible for the payment of all imbalance charges,
penalties, losses, expenses, and claims arising under the
4
60<PAGE>
<PAGE>
provisions of those agreements which are incurred through no
fault of Laclede or MRT;
(b) be responsible for communicating the information needed by
MRT for the efficient performance of its agency
responsibilities. Penalties resulting solely from Laclede's
failure to provide such timely information shall be the
responsibility of Laclede; and
(c) be responsible for providing the gas and other gas supply
resources necessary for the performance of this Agency
Agreement.
ARTICLE IV
Consultation
The parties recognize that if MRT is to perform its obligations
hereunder in an efficient and cost-effective manner for Laclede, regular
and timely communication is critical. Hence, the parties shall consult and
cooperate with each other in order to enable MRT to perform all obligations
for the benefit of Laclede. If the parties are unable to resolve a course
of action through consultation, the final determination regarding such
course of action shall be made by Laclede.
ARTICLE V
Coordination and Use of Facilities
The parties specifically intend and agree --
5
61<PAGE>
<PAGE>
(a) to coordinate injections into and withdrawals from Laclede's
capacity in MRT's underground natural gas storage facilities
with the other gas supply related assets outside of the scope
of this Agreement which Laclede owns, operates, or controls;
(b) to utilize Laclede's transportation capacity on MRT and
upstream pipelines, including NorAm Gas Transmission
Company, an affiliate of MRT; and
(c) to schedule flowing upstream supplies of natural gas,
so as to achieve for Laclede maximum operational efficiencies and economies
consistent with the provision of a reasonably-priced, reliable and adequate
natural gas service to Laclede. MRT shall have an obligation to perform
all functions delegated to it under this Agreement so as to achieve this
goal.
ARTICLE VI
Liability
6.1 MRT warrants that all acts or actions taken by it as agent for
Laclede will be in full compliance, to the best of its knowledge, with the
terms and conditions of MRT's FERC Gas Tariff, and all applicable laws,
regulations and orders of the FERC, any successor regulatory body and other
governmental authorities.
6.2 MRT shall indemnify and hold Laclede harmless from all suits,
actions, costs (including imbalance charges and penalties), losses and
expenses (including, without limitation, attorneys fees and the attorneys
fees of third parties) arising from: (i) all communications, acts, actions,
inactions or omissions by MRT as agent for Laclede, except where such
communications, acts, actions, inactions or omissions
6
62 <PAGE>
<PAGE>
were expressly or directly caused by Laclede, or were otherwise fully
beyond MRT's control; (ii) claims associated with the reliance by other
parties upon such communications, acts, actions, inactions or omissions of
MRT as agent for Laclede; and (iii) any breach by MRT of this Agreement.
ARTICLE VII
Agency and Management Fee
7.1 In order to reimburse MRT for the costs it incurs under this
Agency Agreement, Laclede agrees to pay MRT an agency fee equal to the
annual Operations and Maintenance expenses and General and Administrative
expenses MRT incurs to provide agency services to Laclede under this
Agreement; provided, however, that the annual fee hereunder for services
performed for any annual period from November 1 through October 31 of any
year shall in no event,: (a) total an amount greater than $550,000 in the
aggregate for any such year; (b) include total charges from MRT's parent
company which are in excess of $50,000 for any such year; or (c) include
any charges not directly attributable to MRT's performance of the services
hereunder.
ARTICLE VIII
Billing and Payment
8.1 MRT shall invoice Laclede on or before the tenth (10th) day of
each month for the actual costs it incurs on Laclede's behalf, including
those costs payable pursuant to Article VII, during the preceding month.
7
63<PAGE>
<PAGE>
8.2 Laclede shall pay MRT at its designated office or Post Office
Box, on or before the twentieth (20th) day of each month for service
rendered during the preceding month and billed by MRT as provided in
Section 8.1 above.
ARTICLE IX
Term
9.1 This Agreement shall be effective from November 1, 1996 and shall
remain in effect until such time as Laclede or MRT terminates the Agreement
as provided herein.
9.2 Either Laclede or MRT shall have the right to terminate this
Agreement effective as of October 31, 1997 or effective any October 31
thereafter, by providing sixty (60) days prior written notice to the other
party.
9.3 This Agreement is not assignable by MRT without the written
consent of Laclede. An assignment made without Laclede's written consent
is void.
IN WITNESS WHEREOF, the parties have duly executed this Agreement, in
multiple originals, on the day and year first above written.
LACLEDE GAS COMPANY MISSISSIPPI RIVER TRANSMISSION
CORPORATION
By: Kenneth J. Neises By: Edwin J. Spiegel
Title: Senior Vice President Title: Attorney In Fact
8
64
Exhibit 10.19
EXECUTION COPY
August 19, 1996
Laclede Gas Company
720 Olive Street
St. Louis, Missouri 63101
Ladies and Gentlemen:
Re: Line of credit agreement among Laclede Gas Company
(the "Company" or "Laclede"), The Chase Manhattan Bank ("Chase"), The
Boatmen's National Bank of St. Louis ("Boatmen's") and Mercantile Bank
of St. Louis National Association ("Mercantile") (each a "Bank" and
collectively the "Banks". Said line of credit agreement shall
hereinafter be called the "Line of Credit Agreement").
The undersigned Banks have established for Laclede a committed line
of credit (the "Line of Credit") under which the Company may from time to
time prior to the Termination Date (such term and certain other capitalized
terms used herein being defined below) request advances ("Advances") subject
only to the terms and conditions expressly set forth below.
1. Definitions. As used herein, the following terms shall have the
meanings specified below:
a. "ABR Advance" shall mean any Advance bearing interest at a rate
determined by reference to the Alternate Base Rate as defined herein.
b. "Alternate Base Rate" shall mean for any day a rate per annum
(rounded upwards, if not already a whole multiple of 1/16 of 1%, to the next
higher 1/16 of 1%) equal to the greater of (i) the Prime Rate in effect on
such day, and (ii) the Federal Funds Effective Rate in effect for such day
plus 1/2 of 1%. For purposes hereof, "Prime Rate" shall mean the rate of
interest per annum announced by Chase from time to time as its prime rate in
effect at its principal office in the City of New York; each change in the
Prime Rate shall be effective on the Business Day such change is publicly
announced as being effective. "Federal Funds Effective Rate"
65<PAGE>
<PAGE>
shall mean, for any day, the weighted average of the rates on overnight
Federal funds transactions (calculated on a per annum basis) with members of
the Federal Reserve Bank of New York, as published on the next succeeding
Business Day by the Federal Reserve Bank of New York, or, if such rate is
not so published for any day which is a Business Day, the average of the
quotations for the day of such transactions received by Chase from three
Federal funds brokers of recognized standing selected by Chase. If Chase
shall have determined that it is unable to ascertain the Federal Funds
Effective Rate for any reason, the Alternate Base Rate shall be determined
without regard to clause (ii) of the first sentence of this definition until
the circumstances giving rise to such inability no longer exist. Any change
in the Alternate Base Rate due to a change in the Prime Rate or the Federal
Funds Effective Rate shall be effective on the Business Day of such change
in the Prime Rate or the Federal Funds Effective Rate, respectively. The
Alternate Base Rate shall be determined by Chase and such determination
shall be conclusive absent manifest error.
c. "Business Day" shall mean any day (other than a day which is a
Saturday, Sunday or legal holiday in the State of New York) on which Chase
is open for business in the City of New York; PROVIDED that when the term
"Business Day" is used with respect to LIBO Rate Advances, such term shall
exclude any day on which banks in London are not open for dealings in U.S.
Dollar deposits in the London Interbank Market.
d. "Interest Period" shall mean (i) as to any LIBO Rate Advance, the
period commencing on the date of such LIBO Rate Advance and ending on the
numerically corresponding day (or, if there is no numerically corresponding
day, on the last day) in the calendar month that is 1, 2 or 3 months
thereafter, as the Company may elect, (ii) as to any ABR Advance, the period
commencing on the date of such ABR Advance and ending on the Termination
Date or any earlier date specified by the Company in the notice requesting
such Advance; PROVIDED, HOWEVER, that (1) if any Interest Period would end
on a day that shall not be a Business Day, such Interest Period shall be
extended to the next succeeding Business Day unless, with respect to LIBO
Rate Advances only, such next succeeding Business Day would fall in the next
calendar month, in which case such Interest Period shall end on the next
preceding Business Day and (2) interest shall accrue from and including the
first day of an Interest Period to but excluding the last day of such
Interest Period.
66<PAGE>
<PAGE>
e. "LIBO Rate" shall mean, with respect to any LIBO Rate Advance for
any Interest Period, the interest rate per annum (rounded upwards, if
necessary, to the next higher 1/16 of 1%) at which U.S. Dollar deposits
approximately equal in principal amount to such LIBO Rate Advance and for a
maturity equal to the applicable Interest Period are offered by leading
banks in the London Interbank Market to the London office of Chase in
immediately available funds at or near 11:00 a.m., London time, two Business
Days prior to the commencement of such Interest Period. The LIBO Rate shall
be determined by Chase and such determination shall be conclusive absent
manifest error.
f. "LIBO Rate Advance" shall mean any advance bearing interest at a rate
determined by reference to the LIBO Rate as defined herein.
g. "Termination Date" shall mean March 1, 1997.
2. Maximum Amounts of Advances. After the Effective Date of this Line of
Credit agreement, the combined aggregate principal amount of Advances at any
time outstanding from any Bank under this Line of Credit agreement shall not
exceed the amount set forth opposite the name of such Bank below (such
Bank's "Maximum Amount"), and shall be in a combined aggregate principal
amount at any time outstanding which shall not exceed $60,000,000:
NAME OF BANK MAXIMUM AMOUNT
Chase $30,000,000
Boatmen's $15,000,000
Mercantile $15,000,000
3. Effective Date. The Effective Date of this Line of Credit Agreement
shall be September 3, 1996 (the "Effective Date").
4. Requests For Advances. Laclede shall give the Bank or Banks from which
any Advances shall be requested written or telecopy notice (or telephone
notice promptly confirmed in writing or by telecopy) not later than 10:30
a.m., New York City time, three Business Days before each proposed LIBO Rate
Advance, and no later than 12:00 p.m., New York City time, the day of each
proposed ABR Advance. Such notice shall be irrevocable and shall in each
case specify (i) whether the Advance then being requested is to be a LIBO
Rate Advance or an ABR Advance; (ii) the date of such Advance (which shall
be a Business Day) and the amount thereof; and (iii) if such Advance is to
be a LIBO Rate Advance, the
67 <PAGE>
<PAGE>
Interest Period with respect thereto. No LIBO Rate Advance may be requested
if the Interest Period applicable thereto would end after the Termination
Date. The proceeds of each Advance pursuant to the Line of Credit shall be
deposited by the Bank making such Advance in the general deposit account of
the Company with such Bank or disbursed in another manner agreed upon by the
Company and such Bank as promptly as practicable, but in no event later than
4:00 p.m., New York City time, on the date of such Advance.
5. Repayment Of Advances. The principal of each Advance shall be due and
payable on the earliest of the last day of the Interest Period applicable
thereto, the Termination Date and the date of commencement of any
bankruptcy, insolvency or similar proceeding in respect of Laclede. Each
Bank shall also have the right, upon notice to Laclede, to cause the
principal of and all interest accrued but not yet paid on all Advances made
by it hereunder, together with all other amounts owed to it hereunder, to
become immediately due and payable in the event Laclede shall default in the
payment of any amount due to such Bank hereunder and such default shall
continue for three Business Days after notice thereof from such Bank.
Advances may be repaid at any time subject, in the case of any LIBO Rate
Advance repaid other than on the last day of an Interest Period, to the
indemnity obligations set forth below, but otherwise without premium or
penalty.
6. Interest On Advances. Laclede agrees to pay interest (a) in the case of
each ABR Advance at a rate per annum equal to the Alternate Base Rate and
(b) in the case of each LIBO Rate Advance at the LIBO Rate applicable to the
Interest Period in effect for such Advance plus 1/4% per annum. Interest on
each Advance shall accrue from and including the date such Advance is made
to but excluding the date such Advance is repaid, and shall be payable at
the time the principal of such Advance is repaid and, in the case of each
ABR Advance which shall not theretofore have been repaid, on the date 90
days after the date on which such Advance shall have been made. The Company
agrees to pay interest, on demand, on any overdue principal and, to the
extent permitted by applicable law, overdue interest until paid at a rate
per annum equal to the Alternate Base Rate plus 2%. Interest shall be
computed on the basis of the actual number of days elapsed in a year of (i)
365 days in the case of ABR Advances when the Alternate Base Rate is based
on the Prime Rate and (ii) 360 days in all other cases.
68<PAGE>
<PAGE>
7. Facility Fee. Laclede agrees to pay to each Bank, on the last Business
Day of each calendar quarter and on the Termination Date or any earlier date
on which the availability of Advances from such Bank is terminated as
provided herein, a facility fee of .08% per annum on the Maximum Amount of
such Bank, whether used or unused. Such fee shall accrue from and including
the Effective Date to but excluding the earlier of the Termination Date and
any date on which the availability of Advances from such Bank is terminated
as provided herein.
8. Waiver, Amendment And Remedies. Laclede hereby waives diligence,
presentment, demand, protest, notice of dishonor and any other notice of any
kind whatsoever. Neither the failure nor any delay on the part of any Bank
in any particular instance to exercise any right, power or privilege
hereunder shall constitute a waiver thereof in that or any subsequent
instance. No consent, amendment, modification or waiver of the terms or
provisions hereof shall be effective unless in writing and executed by
Laclede and each Bank. All rights and remedies of each Bank are cumulative
and concurrent, and no single or partial exercise by any Bank of any right,
power or privilege shall preclude any other or further exercise of any other
right, power or privilege.
9. Conditions To Advances. The aggregate principal amount of Advances at
any time outstanding hereunder from any Bank shall in no event exceed the
Maximum Amount of such Bank. The making of Advances is also subject to the
absence of any material adverse change since September 30, 1995, in the
financial condition of the Company and to the receipt by each Bank of a copy
of this letter duly executed by Laclede and an executed Note in the form
attached as Exhibit A hereto, duly completed to set forth the name, the
address and the amount of the commitment of each Bank (the "Note"),
accompanied by such evidence of the corporate power and authority of Laclede
as the Banks may request.
10. Indemnification; Payment Of Additional Costs To Bank. Laclede shall
indemnify each Bank against any loss or reasonable expense which such Bank
may sustain or incur as a consequence of (a) any payment or prepayment of a
LIBO Rate Advance on a date other than the last day of the Interest Period
applicable thereto or (b) any failure of Laclede to borrow any LIBO Rate
Advance requested by it hereunder. Such loss or reasonable expense shall
include an amount equal to the excess, if any, as reasonably determined by
such Bank, of (i) its cost of obtaining the funds for the Advance being
69<PAGE>
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paid, prepaid or not borrowed for the period from the date of such payment,
prepayment or failure to borrow to the last day of the Interest Period for
such Advance (or, in the case of a failure to borrow, the Interest Period
for such Advance which would have commenced on the date of such failure)
over (ii) the amount of interest (as reasonably determined by such Bank)
that would be realized by such Bank in reemploying the funds so paid,
prepaid or not borrowed for such period or Interest Period, as the case may
be. A certificate of any Bank setting forth any amount or amounts which
such Bank is entitled to receive pursuant to this provision shall be
delivered to Laclede and shall be conclusive absent manifest error.
If after the date hereof any change in applicable law or regulation or
in the interpretation of administration thereof by any governmental
authority shall change the basis of taxation of payments to any Bank of the
principal of or interest on any LIBO Rate Advance or any other fees or
amounts payable hereunder, or shall impose, modify or deem applicable any
reserve, special deposit or similar requirement against assets of, deposits
with or for the account of, or credit extended by any Bank, or shall impose
on any Bank any other condition affecting the Advances made by such Bank,
and the result of any of the foregoing shall be to increase the cost to such
Bank of making or maintaining such Advances or to reduce the amount of any
sum received or receivable by such Bank hereunder (whether of principal,
interest or otherwise) in respect thereof by an amount deemed by such Bank
to be material, then Laclede agrees to pay to such Bank such additional
amount or amounts as will compensate such Bank for such additional costs or
reduction. A certificate of any Bank setting forth the amount or amounts
which shall be necessary to compensate such Bank and, in reasonable detail,
the method by which such amount have been determined shall be delivered to
Laclede and shall be conclusive absent manifest error.
Laclede agrees to pay the amount or amounts specified in any
certificate delivered pursuant to one of the two preceding paragraphs to the
applicable Bank within 10 days after its receipt of the same.
11. Notification Of Interest Rate. Chase hereby agrees, at the request of
Laclede or any other Bank, promptly to determine and advise Laclede or such
other Bank of the LIBO Rate or the Alternate Base Rate for any Interest
Period or day within an Interest Period.
70
<PAGE>
<PAGE>
12. Termination Of Facility. The availability of Advances hereunder from
any Bank may be terminated by Laclede upon written or telecopy notice to
such Bank, and will in any event terminate on the earlier of the Termination
Date and the date of commencement of any bankruptcy, insolvency or similar
proceeding in respect of Laclede.
13. Corporate Authority. Laclede represents and warrants that it has the
corporate power and authority and all necessary regulatory approvals to
execute, deliver and perform its obligations under this Agreement and that
such execution, delivery and performance will not violate any law or
regulation applicable to Laclede or any agreement to which Laclede is party.
Each Bank is hereby authorized to rely on notices given hereunder by persons
reasonably believed by it to be acting on behalf of Laclede.
14. Amendment And Governing Law. This letter may not be amended or any
provision hereof waived or modified except by an instrument in writing
signed by each of the parties hereto. This letter shall be governed by, and
construed in accordance with, the laws of the State of New York.
15. Headings. The headings in this Line of Credit Agreement are for
convenience and shall not limit or otherwise affect any of the provisions of
this Line of Credit Agreement.
Please indicate your acceptance of the terms hereof by signing in the
appropriate space below and returning to Chase the enclosed duplicate
originals of this letter. This letter may be executed in counterparts, each
of which shall be an original and all of which, when taken together, shall
constitute one agreement.
Commitment Very truly yours,
$30,000,000 THE CHASE MANHATTAN BANK
by
Name: Michiel V. M. van der Voort
Title: Vice President
Address for Notices:
One Chase Manhattan Plaza - Third Floor
New York, New York 10081
Attn. of: Mr. Michiel V. M. van der Voort
Telecopy: (212) 552-7625
71 <PAGE>
<PAGE>
$15,000,000 THE BOATMEN'S NATIONAL BANK OF
ST. LOUIS
by
Name: Thomas C. Guyton
Title: Vice President
Address for Notices:
One Boatmen's Plaza
800 Market Street
St. Louis, Missouri 63166-0236
Attn. of: Mr. Thomas Guyton
Telecopy: (314) 466-7783
$15,000,000 MERCANTILE BANK OF ST. LOUIS NATIONAL
ASSOCIATION
by
Name: Sally H. Roth
Title: Vice President
Address for Notices:
#1 Mercantile Center
12th Floor
P.O. Box 524
St. Louis, Missouri 63101
Attn. of: Ms. Sally Roth
Telecopy: (314) 425-2162
Accepted and agreed to as of the date first
written above:
LACLEDE GAS COMPANY,
by
Name: Gerald T. McNeive, Jr.
Title: Senior Vice President-Finance
72<PAGE>
<PAGE>
EXHIBIT A
NOTE
$ ,000,000 New York, New York
September 3, 1996
FOR VALUE RECEIVED, the undersigned, LACLEDE GAS COMPANY, a
Missouri corporation (the "Company"), hereby promises to pay to the order of
(the "Bank"), at the office of the Bank at
: (a) on the last day of each Interest
Period, as defined in the letter agreement dated as of August 19, 1996,
(said letter agreement, being hereinafter called the "Letter of Credit
Agreement") between the Company, the Bank and certain other banks, the
aggregate unpaid principal amount of each Advance (as defined in the Letter
of Credit Agreement) made by the Bank to which such Interest Period relates;
and (b) on March 1, 1997, the lesser of $ and the aggregate
principal amount of all Advances made by the Bank under the Letter of Credit
Agreement and remaining unpaid; in each case in lawful money of the United
States of America in immediately available funds. The undersigned promises
to pay interest on the unpaid principal amount of each Advance at the rates
and payable on the dates provided for in the Letter of Credit Agreement.
The Company hereby waives diligence, presentment, demand,
protest and notice of any kind. The nonexercise by the holder of any of its
rights hereunder in any particular instance shall not constitute a waiver
thereof in that or any subsequent instance.
All Advances by the Bank evidenced by this Note, the interest
rates applicable thereto and all payments of the principal hereof and
interest hereon and the respective dates thereof shall be endorsed by the
holder hereof on the schedule attached hereto and made a part hereof or on a
continuation thereof which shall be attached hereto and made a part hereof,
or otherwise recorded by such holder in its internal records; provided,
however, that the failure of the holder hereof to make such a notation or
any error in such a notation shall not affect the obligations of the Company
under this Note.
This Note shall be construed in accordance with and governed by
the laws of the State of New York and any applicable laws of the United
States of America.
LACLEDE GAS COMPANY
By:
Name: Ronald L. Krutzman
Title: Treas. & Asst. Secy.
73
<TABLE>
Exhibit 12
LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES
SCHEDULE OF COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
-------------------------------------------------------------
<CAPTION>
Fiscal Year Ended September 30,
----------------------------------------
1996 1995 1994 1993 1992
---- ---- ---- ---- ----
(Thousands of Dollars)
<S> <C> <C> <C> <C> <C>
Income before interest
charges and the cumulative
effect of change in
accounting $50,771 $39,428 $38,611 $41,380 $33,888
Add: Taxes based on
utility income 18,603 9,878 12,517 14,997 8,272
Taxes based on
miscellaneous income (205) 252 121 1,068 172
One third of applicable
rentals charged to
operating expense
(which approximates the
interest factor) 291 288 287 284 279
-------------------------------------------
Total Earnings $69,460 $49,846 $51,536 $57,729 $42,611
===========================================
Interest on long-term debt $13,939 $12,544 $12,626 $14,415 $13,803
Other interest 4,008 5,983 3,768 1,798 1,811
One-third of applicable rentals
charged to operating expense
(which approximates the
interest factor) 291 288 287 284 279
-------------------------------------------
Total Fixed Charges $18,238 $18,815 $16,681 $16,497 $15,893
===========================================
Ratio of Earnings to
Fixed Charges 3.81 2.65 3.09 3.50 2.68
</TABLE>
74
Exhibit 21
LACLEDE GAS COMPANY AND SUBSIDIARIES
SUBSIDIARIES OF THE REGISTRANT
PERCENT OF
VOTING STOCK
OWNED
------------
Subsidiaries of Laclede Gas Company (Parent)
Laclede Pipeline Company 100%
Laclede Investment Corporation* 100%
Laclede Development Company** 100%
*Subsidiary Company of Laclede Investment Corporation
Laclede Energy Resources, Inc. 100%
Subsidiary Company of Laclede Energy Resources, Inc. 100%
Laclede Gas Family Services, Inc.
***Subsidiary Company of Laclede Development Company
Laclede Venture Corp. 100%
All of the above corporations have been organized under the laws of the
State of Missouri.
75
Exhibit 23
DELOITTE & TOUCHE LLP
One City Centre
St. Louis, MO 63101
INDEPENDENT AUDITORS' CONSENT
We consent to the incorporation by reference in Registration Statement Nos.
33-60996 and 33-52357 of Laclede Gas Company and its subsidiary companies on
Form S-3 and in Registration Statement Nos. 33-38413, 33-57573 and 33-64933
of Laclede Gas Company and its subsidiary companies on Form S-8 of our
report dated November 21, 1996 (December 20, 1996 as to Note 8) appearing in
this Annual Report on Form 10-K of Laclede Gas Company and its subsidiary
companies for the year ended September 30, 1996.
Deloitte & Touche LLP
December 20, 1996
76
<TABLE> <S> <C>
<ARTICLE> UT
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-1996
<PERIOD-END> SEP-30-1996
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 452,165
<OTHER-PROPERTY-AND-INVEST> 24,265
<TOTAL-CURRENT-ASSETS> 133,383
<TOTAL-DEFERRED-CHARGES> 79,582
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 689,395
<COMMON> 19,423
<CAPITAL-SURPLUS-PAID-IN> 37,188
<RETAINED-EARNINGS> 184,232
<TOTAL-COMMON-STOCKHOLDERS-EQ> 240,843
1,960
0
<LONG-TERM-DEBT-NET> 179,346
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 59,600
<LONG-TERM-DEBT-CURRENT-PORT> 0
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 207,646
<TOT-CAPITALIZATION-AND-LIAB> 689,395
<GROSS-OPERATING-REVENUE> 544,816
<INCOME-TAX-EXPENSE> 17,348
<OTHER-OPERATING-EXPENSES> 481,073
<TOTAL-OPERATING-EXPENSES> 498,421
<OPERATING-INCOME-LOSS> 46,395
<OTHER-INCOME-NET> 4,376
<INCOME-BEFORE-INTEREST-EXPEN> 50,771
<TOTAL-INTEREST-EXPENSE> 17,947
<NET-INCOME> 32,824
97
<EARNINGS-AVAILABLE-FOR-COMM> 32,727
<COMMON-STOCK-DIVIDENDS> 22,079
<TOTAL-INTEREST-ON-BONDS> 13,939
<CASH-FLOW-OPERATIONS> 41,267
<EPS-PRIMARY> 1.87
<EPS-DILUTED> 1.87
<FN>
Capital surplus, paid in includes $(24,017) treasury stock.
77
</TABLE>
