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, 1994
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 Identification 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 October 31, 1994 was $326,700,576.
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. 15,670,023
Incorporated by Reference: Form 10-K Part
Proxy Statement dated December 27, 1994* III
Index to Exhibits is found on page 58.
* The information under the captions "Compensation Committee Report
Regarding Compensation" and "Performance Graph" on pages 14-17 is NOT
incorporated by reference.
1
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 County, the town of Arnold, and parts of 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. The Company has also made investments in other non-
utility businesses as part of a diversification program.
NATURAL GAS SUPPLY
Federal Energy Regulatory Commission (FERC) Order 636 requires interstate
natural gas pipeline companies to offer unbundled, or separate, gas
transportation and storage services and to discontinue their bundled
merchant sales operation, which included gas acquisition as well as related
storage and transportation service.
In December 1992, the Mississippi River Transmission Corporation (MRT),
Laclede's principal supplier at that time, filed its initial restructuring
plan, which after careful analysis, Laclede concluded was unacceptable. The
two companies were unable to develop an acceptable restructuring plan that
would meet the requirements of Order 636 and provide Laclede with the long-
term gas supply assurances provided by Laclede's previous contract with MRT.
As as result, the long-term supply contract between Laclede and MRT was
terminated on November 1, 1993.
To replace the MRT contract, the two companies have entered into an agency
agreement in which Laclede is responsible for acquiring its own gas supplies
and making transportation and storage arrangements to get such supplies to
MRT's pipeline system. MRT, as Laclede's agent, is responsible for
administering, much as it historically has done, the various functions (such
as scheduling day-to-day gas supply and transportation, and managing storage
requirements, all in accord with Laclede's needs) for deliveries to Laclede
in a manner that will achieve for Laclede maximum operational efficiency and
economy. MRT has agreed to advise and assist Laclede in locating sources of
gas and helping to negotiate purchases from these sources. On November 1,
1993, the new agency relationship and unbundled pipeline services went into
effect.
The Company's supply agreements applicable to Missouri Pipeline Company were
structured in a manner that is more compatible with Order 636 and need not
be terminated in order to reconcile it with that Order.
Gas for producing areas is transported through interstate "upstream"
pipelines into the pipeline systems of Mississippi River Transmission
Corporation (MRT) and Missouri Pipeline Company (MPC) for delivery to
Laclede's service area. Under FERC Order 636, Laclede was allocated a part
of such upstream firm transportation pipeline capacity, which connects MRT's
system to the gas production basins and off-shore platforms, as well as a
share of MRT's underground gas storage capacity. Most of such storage
capacity is located in northern Louisiana. Wherever possible, Laclede
negotiated revisions or reformed the gas transportation agreements MRT
2
formerly had with the three primary transporters of gas into MRT's pipeline
system. The new arrangements increased Laclede's operational flexibility as
compared to MRT's purchasing the transportation services and also provided
reduced unit costs. Laclede also has been able to release firm
transportation capacity to other gas users when it was not required for use
by the Company's own customers. This resulted in reducing Laclede's overall
gas costs during 1994 by almost $3.1 million.
In order to meet its gas supply requirements in the restructured environment
of the interstate natural gas pipeline industry, Laclede put in place last
year arrangements to purchase gas directly from producers and marketers. In
making such arrangements Laclede has had the twofold objectives of: (1)
insuring that the gas supplies it acquires are dependable and will be
delivered when needed; and (2) insofar as is compatible with that
dependability, that the gas purchased will be reasonably and economically
priced.
Consonant with those intertwined objectives Laclede acquired its purchased
gas supplies from three different producing basins - Mid-Continent, Gulf
Coast and offshore - and also concentrated its firm purchases of gas with
major suppliers which own or have large natural gas reserves available to
them. Long-term agreements were negotiated in 1994 between Laclede and
subsidiaries of two of the ten largest gas producers in the United States -
Amoco and Arco. The Amoco agreement involves the reformation of two
existing MRT agreements with Amoco to better suit Laclede's requirements and
to involve Amoco in a long-term commitment to the St. Louis market.
The Arco agreement will provide significant firm long-term gas supplies to
Laclede and its customers with an initial term extending to 1999. While
reliablity of supply is Laclede's first gas supply imperative, the Company's
arrangements also have met the second objective of being reasonably priced
insofar as is consistent with obtaining long-term, firm commitments from
suppliers.
During fiscal 1994, Laclede Gas Company purchased natural gas from a
diverse group of 32 suppliers to meet its current market and storage
injection requirements. Natural gas purchased by Laclede and delivered to
St. Louis through the MRT system during fiscal 1994 totalled 80.8 billion
cubic feet, including 5.1 Bcf purchased directly from MRT in October 1993
before Order 636 was implemented. Purchases through the MPC system during
fiscal 1994 totalled 12.5 Bcf, all of which was purchased pursuant to the
Company's long-term firm supply contract with ESCO Energy, Inc. The long-
term ESCO agreement provides for the delivery and purchase of up to 55,000
MMBtu of gas per day through the various MPC interconnects in St. Charles
and Franklin counties.
It must be pointed out that the FERC-ordered new supply system has only been
effective for the past year and that the past winter was warmer than normal,
not only in Laclede's service area but in most areas of the country. The
new system has not been tested on severely cold days over a long and
protracted cold winter, and Laclede's management has some concern about how
well this FERC ordered system will perform for the gas industry under such
weather conditions. This concern underlies the Company's insistence on
supply reliability as being the most important requirement of its gas supply
portfolio.
3
The peak day sendout of 1,113,000 MMBtu occurred on Tuesday, January 18,
1994, when the average temperature was -1 degree Fahrenheit. This peak day
sendout was met by using 632,000 MMBtu of gas purchased and transported
using the MRT system, 301,000 MMBtu of gas withdrawn from Laclede's storage
facilities, 84,000 MMBtu of propane, 60,000 MMBtu of gas purchased under the
Company's long-term gas supply contract with ESCO Energy, Inc., and 36,000
MMBtu of gas not owned by the Company that was transported for Laclede
customers. Temperatures during the heating season on average were 3% warmer
than fiscal 1993 and 1% warmer than normal. The Company sold and
transported 1,070.1 million therms of gas this year, a decrease of 10.0
million therms from fiscal 1993.
UNDERGROUND NATURAL GAS STORAGE
The Company has entered into 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 under normal operations 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 33,000,000 gallons) propane storage facilities in St. Louis
County, Missouri, to propane supply terminal facilities located at Wood
River and Cahokia, Illinois. Liquid propane gas 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-three 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 $10,000 in 1994,
$84,000 in 1993 and $50,000 in 1992, 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 Laclede Energy Resources, Inc.
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.
4
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 1994, 1993 and 1992. Presently,
Laclede is not actively seeking new gas and oil exploration discoveries
through LIMA, or otherwise.
REGULATORY MATTERS
The implementation of unbundled services on MRT's system, pursuant to FERC
Order 636, necessitated a change in Laclede's Purchased Gas Adjustment
Clause (PGA). Accordingly, on October 1, 1993, Laclede filed a revised PGA
clause with the Missouri Public Service Commission (MoPSC) to enable the
Company to continue to flow through to its customers any increases or
decreases in the Company's cost of purchased gas. The MoPSC approved such
filing on October 29, 1993.
The Company is currently involved in a proceeding before the MoPSC regarding
the operation of PGA clauses. The Company expects that its operation of the
PGA clause will be reviewed in the context of the changed environment in
which the Company and other local distributors are required to buy their gas
from unregulated producers and marketers instead of from the formerly
regulated interstate pipelines.
The cost of buying natural gas at the wellhead and the associated cost of
transporting it to the St. Louis area account for about 60% of Laclede's
total operating costs. Thus, the Commission's proceeding concerning the PGA
clause is of vital importance for the future. Laclede is doing everything
possible to see to it that any modifications in the PGA will not restrict
the Company's ability to promptly adjust rates to reflect changes in
wholesale gas costs.
The new system, with its requirement that local distributors obtain their
own gas supplies and arrange for all required storage and pipeline
transportation services, imposes a much greater degree of risk and
responsibiltiy upon the gas distributor and relieves the interstate gas
pipeline company of a similar risk and responsibility. Laclede believes
that regulatory commissions throughout the nation should take into account
this change in risk in setting the permissible rate of return allowed to the
gas distribution companies which they regulate.
As previously reported, MRT asked the FERC in October 1992 to approve higher
rates for its bundled gas sales service, as well as for the use of its
separate gas transportation and gas storage services. In April 1993, MRT was
able to put the proposed new rates into effect, subject to refund to the
extent not fully approved by the FERC. Then, in July 1994, the FERC
approved a settlement that eliminated virtually all of MRT's proposed rate
increase and brought Laclede refunds of almost $10 million, which the
Company had paid MRT while the higher rates were in effect. These refunds
are being passed through to Laclede's customers.
The settlement also resolved a dispute over MRT's transition costs involved
in the FERC-ordered restructuring of the gas pipeline industry. With
Laclede and other gas distributors now purchasing their gas supplies
directly from producers and marketers, MRT has had to buy out certain long-
term gas supply contracts that the pipeline company entered into when it had
an obligation to provide Laclede and its other customers with their supplies
5
of gas. In order to carry out the restructuring without loss to the
pipeline companies, the FERC is allowing them to recover from their
customers the costs of their contract buyouts. As part of the July 1994
rate case settlement, MRT agreed not to seek recovery from Laclede and its
other customers of about 11% of the amount originally proposed to cover its
gas supply transition costs.
In June 1994, Laclede's persistent efforts to resolve a long-standing
dispute with United Gas Pipe Line Company (United), the former leading
supplier of gas to MRT, resulted in a settlement, which brought Laclede and
its customers refunds of $8 million. The case, which had been pending for
years before FERC and the U.S. Court of Appeals in Washington, D.C., began
when Laclede sought refunds arising out of a 1985 United rate case and
certain questionable gas accounting practices of United. The refunds were
paid to Laclede by the successor corporation of United, the Koch Gateway
Pipeline Company.
In January 1994, Laclede filed new rates with the MoPSC seeking a general
rate increase of $27.1 million annually. The Commission suspended those
rates from becoming effective and entered into a rate case investigation and
hearings thereon. In July 1994, a settlement was reached among the
Commission Staff, Laclede and the other parties who had intervened in the
rate case. This settlement was approved by the MoPSC on August 23, 1994.
Under the settlement, Laclede was permitted to file rates to become
effective September 1, 1994, which are designed to increase the Company's
revenues by $12.2 million annually. Laclede accepted the settlement
believing the lower amount preferable to further litigation and delays in
obtaining the much-needed rate relief. A major part of the increase was a
$1.50 per month increase in the Company's customer charge, a flat monthly
charge applicable to the bills of all customers. This will make the major
portion of the increase granted the Company less subject to the impact of
higher gas rates on low-income customers, many of whom live in poorly
insulated houses.
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, 1994, the Company had 2,151 employees, which includes 2
part-time employees.
*****
The Company has a labor agreement with Locals 5-6 and 5-194 of the Oil,
Chemical and Atomic Workers International, two unions which represent most
of the Company's employees. On June 28, 1994, Company and Union
representatives signed a new three-year labor agreement replacing the prior
agreement which was to expire July 31, 1994. The new contract extends
through July 31, 1997. The settlement provides for wage increases of 3.5%
in the first year, 3.25% the second year, and 3.25% the third year. Other
employee benefit improvements will be effected during the three-year term.
6
*****
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 two major suppliers of fuel oil, a major
supplier of coal, numerous suppliers of 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 2.1 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.
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.
*****
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. Prior to the widespread
availability of natural gas, the Company operated various manufactured gas
plants, the last of which was closed in 1961. The process for manufacturing
gas produced by-products and residuals, including hydrocarbons such as lamp
black and coal tar. Certain remnants of these residuals are typically found
at former gas manufacturing sites. The United States Environmental
Protection Agency (EPA) has been engaged in a survey of a large number of
former manufactured gas plant sites across the nation.
In this regard, the Company and the EPA have determined that manufactured
gas residuals are present at one of the former manufactured gas plant sites
operated by the Company. While no conclusion has been reached as to the
extent of any remedial action that will be required, the Company and the EPA
have entered into an Administrative Order on Consent (AOC), effective
March 31, 1994, with regard to this site. The AOC provides for the Company
to conduct certain investigative activities (i.e., a removal site evaluation
and an engineering evaluation cost analysis), and to reimburse the EPA for
response costs under the AOC. The AOC requires only investigations and does
not cover any removal action. If remedial action is necessary, then a
7
subsequent order will cover such action. Based on currently available
information, management believes that the costs of the foregoing
investigations, response costs of the EPA in overseeing such investigations,
and other associated legal and engineering consulting costs are likely to
approximate $380,000. At September 30, 1994, $135,000 has been paid and a
liability of $245,000 remains to cover future payments.
The Company is presently unable to evaluate and quantify further the scope
or cost of any environmental response activity. However, the Company has
notified its insurers that the Company intends to seek reimbursement from
them of its investigation, remediation, clean-up and defense costs in regard
to the foregoing. In addition to pursuing insurance proceeds to the extent
feasible, the Company also plans to seek recovery, if practicable, from any
other potentially responsible parties.
An environmental cost deferral procedure was established by the Missouri
Public Service Commission in the Company's recent rate case, effective
September 1, 1994, for use by the Company in applying for appropriate rate
recovery of various investigation, remediation and other costs to be
incurred by the Company in connection with former manufactured gas plant
sites. The authorization to begin deferring such costs shall only be
triggered to the extent that the cumulative liability incurred by the
Company during the deferral period is not offset by the cumulative costs of
$250,000 per year reflected in the Company's current rates. In the event
the cumulative liability incurred by the Company for such costs during the
deferral period is less than the cumulative amount of such annualized costs
reflected in the rates approved in the settlement, then the Company shall
refund the difference. The above authorization will become null and void if
the Company does not file for a general rate increase by September 1, 1996,
and, in any event, the recovery of costs deferred thereunder is subject to
challenge in future rate cases.
*****
At the Annual Meeting held on January 27, 1994, the Company's share owners
approved an amendment which increased the authorized common stock to
50,000,000 shares with a new par value of $1.00 per share and reclassified
the par value of the outstanding common stock from $2.00 to $1.00 per share.
These changes were approved in connection with a 2-for-1 stock split
authorized by the Board of Directors which became effective February 11,
1994.
Share owners approved an amendment to the Company's Dividend Reinvestment
Plan at the January 27, 1994 meeting to permit cash purchases of common
stock through the Plan, with a minimum purchase of $100 per calendar quarter
up to a maximum purchase of $30,000 per calendar year. The amendement also
provides for the issuance of common shares by the Company to provide shares
purchased under the Plan. The Company filed a Registration Statement for
the Plan with the Securities and Exchange Commission on February 22, 1994.
During fiscal 1994, 83,561 shares were issued under the Company's Dividend
Reinvestment and Stock Purchase Plan.
8
*****
Customers and revenues contributed by each class of customers for the last
three fiscal years are as follows:
Revenues $(000)
1994 1993 1992
---- ---- ----
Residential $363,058 $348,494 $281,325
Commercial & Industrial 142,042 136,462 117,744
Interruptible 1,966 2,455 2,684
Transportation 14,898 11,437 12,431
Exploration & Development 1,600 1,488 1,392
Provision for Refunds (3,770) - -
Other 4,072 3,612 2,614
-------- -------- --------
Total $523,866 $503,948 $418,190
======== ======== ========
Customers (End of Period) 1994 1993 1992
---- ---- ----
Residential 559,225 555,467 552,141
Commercial & Industrial 36,684 36,514 36,241
Interruptible 14 13 17
Transportation 124 115 107
------- ------- -------
Total 596,047 592,109 588,506
======= ======= =======
*****
The Company has, or in one instance is seeking renewal of, 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 has a 39.6% interest in LIMA.
Laclede Energy is not presently actively seeking new gas and oil exploration
discoveries through LIMA, or otherwise.
9
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 hospital-
ization, 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, is engaged in
participation in real estate development, primarily through joint ventures.
In December 1987, Laclede Development made an investment of $5.8 million in
a 10.25%, 16-year convertible debenture issued by Germania Bank, a St.
Louis-based federal savings institution. The debenture permitted conversion
into 577,000 common shares of Germania stock at $10 per share. On June 22,
1990, government regulators placed Germania Bank in conservatorship, and
appointed the Resolution Trust Corporation (RTC) as Conservator for the
Bank. The Company recorded, in fiscal 1990, a provision for the possible
write-off of this investment. In September 1992, Laclede learned that a
former senior executive of Germania Bank had pleaded guilty to participating
in a criminal conspiracy to defraud former bank investors, including
Laclede. On September 18, 1992, Laclede filed a lawsuit in the U. S.
District Court for the Eastern District of Missouri against the executive
and against the RTC, as Receiver for Germania, alleging that Germania
engaged in fraud, negligent misrepresentation, breach of contract, and
violation of securities law by establishing inadequate loan loss reserves
and withholding information in this regard from Laclede, and that the RTC
had knowledge of the actionable wrong-doing but did not disclose to Laclede
its existence, nature, extent or substance. On November 19, 1992, criminal
indictments were issued in Missouri and Illinois charging fraud by certain
additional former Germania senior executives, and, based upon such
indictments, Laclede promptly amended its lawsuit to name such additional
persons as defendants. On November 10, 1993, the jury in the Illinois
criminal trial found the two senior executives who were indicted in Illinois
guilty on all charges. Laclede Development's civil suit was transferred to
the U.S. District Court for the Southern District of Illinois. The RTC and
other defendants have vigorously contested Laclede's civil suit.
Laclede Venture Corp., a wholly owned subsidiary of Laclede Development
Company has a 28.5% interest in the LBP Partnership, a general partnership.
LBP was engaged in research and development of light beam profiling
technology for the production of portrait sculpture and for use in other
applications. After conducting market testing, LBP decided to cease its
efforts to exploit the portrait sculpture application of this technology. A
third party has been licensed to look into the possibility of further
development of the technology for non-portrait sculpture applications, but
LBP is not presently earning or receiving any compensation from any such
licensing or development.
The lines of business which constitute the non-utility activities of the
corporate family are not considered significant as defined.
10
Item 2. Properties
The principal utility properties of Laclede consist of approximately 7,352
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 jointly owns 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 Part I, Item 1, Business,
Other Pertinent Matters.
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 1994.
11
EXECUTIVE OFFICERS OF REGISTRANT
Name, Age, and Position with Company Appointed (1)
R. C. Jaudes, Age 60
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
H. Elliott, Jr., Age 61
Senior Vice President - Administrative Services January 23, 1992
Vice President - Administration January 27, 1977
D. L. Godiner, Age 61
Senior Vice President - General Counsel
and Secretary January 24, 1991
Vice President - General Counsel and Secretary September 1, 1990
Vice President and General Counsel January 22, 1981
R. J. Carroll, Age 57
Senior Vice President - Finance and Chief
Financial Officer January 27, 1994
Vice President - Finance and Chief Financial
Officer January 23, 1992
Vice President and Controller January 24, 1991
Assistant Vice President - Accounting January 28, 1988
J. G. Hofer, Age 57
Vice President - Operations July 1, 1992
(Superintendent of Operations) July 1, 1991
(Chief Engineer - Director of
Support Services) February 1, 1991
(Superintendent - Engineering
and Support Services) April 1, 1988
R. M. Lee, Age 53
Senior Vice President - Marketing January 27, 1994
Vice President - Marketing January 22, 1987
M. E. McMillian, Age 48
Vice President - Human Resources September 22, 1983
G. T. McNeive, Age 52
Vice President - Associate General
Counsel January 27, 1994
Assistant Vice President - Associate
General Counsel September 1, 1992
(Associate General Counsel) August 1, 1986
J. Moten, Jr., Age 53
Vice President - Community Relations January 27, 1994
(Director of Community Affairs/Conservation) November 1, 1986
12
K. J. Neises, Age 53
Senior Vice President - Federal Regulatory
Affairs January 27, 1994
Vice President - Federal Regulatory Affairs October 27, 1988
P. J. Palumbo, Age 49
Vice President - Industrial Relations September 1, 1992
(Director of Industrial Relations) (2) January 7, 1991
D. H. Yaeger, Age 45
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 (3) December 1, 1990
V. O. Steinberg, Age 56
Vice President - Treasurer and Assistant
Secretary January 27, 1994
Treasurer and Assistant Secretary September 1, 1990
Assistant Secretary-Treasurer September 28, 1978
( ) 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".
(2) Mr. Palumbo served as Senior Vice President - Resource Management at
Peabody Development Company from 1985 through 1990.
(3) Mr. Yaeger served as Executive Vice President of Arkla Energy Marketing
company from April 1990 through November 1990; and prior to that he was
employed at Mississippi River Transmission Corporation as its Vice
President - Marketing from September 1982 to July 1986; Senior Vice
President - Marketing from July 1986 to April 1988; and Executive Vice
President from April 1988 through April 1990.
13
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, 1994, there were 11,564 holders of
record of the Company's common stock.
Common Stock Market and Dividend Information
Price Range Dividends
Fiscal 1994 High Low Declared
- --------------------------------------------------------
1st Quarter 25 23 $.305
2nd Quarter 25-5/8 23-1/2 $.305
3rd Quarter 24-5/8 21 $.305
4th Quarter 22-3/4 20-5/8 $.305
Fiscal 1993
- --------------------------------------------------------
1st Quarter 20-1/2 17-7/8 $.30
2nd Quarter 22 20 $.305
3rd Quarter 23-5/8 21-1/2 $.305
4th Quarter 25 23-3/8 $.305
<FN>
Note: Restated to reflect a 2-for-1 stock split effective February 11,
1994.
14
Item 6. Selected Financial Data
Fiscal Years Ended September 30
(Thousands Except Per Share 1994 1993 1992 1991 1990
Amounts) ---- ---- ---- ---- ----
Summary of Operations
Utility Operating Revenues $523,866 $503,948 $418,190 $438,050 $470,824
-----------------------------------------------
Utility Operating Expenses:
Natural and propane gas 308,515 291,057 235,562 254,288 292,186
Other operation expenses 84,906 81,027 73,521 73,811 71,680
Maintenance 18,351 16,693 15,358 14,309 14,890
Depreciation & amortization 19,332 18,704 18,033 17,048 16,401
Taxes, other than
income taxes 42,627 41,061 35,333 35,289 36,958
Income Taxes 12,517 14,997 8,272 10,795 6,717
Total utility operating -----------------------------------------------
expenses 486,248 463,539 386,079 405,540 438,832
-----------------------------------------------
Utility Operating Income 37,618 40,409 32,111 32,510 31,992
Allowance for Funds Used
During Construction 203 186 377 156 126
Miscellaneous Income and
Income Deductions - Net 790 785 1,400 1,950 (1,912)
-----------------------------------------------
Income Before Interest
Charges 38,611 41,380 33,888 34,616 30,206
-----------------------------------------------
Interest Charges:
Interest on long-term
debt 12,626 14,415 13,803 13,062 12,222
Other interest charges 3,768 1,798 1,811 1,524 1,081
-----------------------------------------------
Total Interest Charges 16,394 16,213 15,614 14,586 13,303
-----------------------------------------------
Income Before Cumulative
Effect of Change in
Accounting 22,217 25,167 18,274 20,030 16,903
Cumulative Effect of Change
in Accounting - - - - 1,650
-----------------------------------------------
Net Income 22,217 25,167 18,274 20,030 18,553
Dividends on Preferred Stk 97 97 97 97 99
-----------------------------------------------
Earnings Applicable to
Common Stock $ 22,120 $ 25,070 $ 18,177 $ 19,933 $ 18,454
===============================================
Earnings Per Share of
Common Stock*:
Before Cumulative Effect of
Change in Accounting $1.42 $1.61 $1.17 $1.28 $1.08
Cumulative Effect of Change
in Accounting - - - - .10
-----------------------------------------------
Total $1.42 $1.61 $1.17 $1.28 $1.18
===============================================
<FN>
*Common share and per share amounts have been restated to reflect a 2-for-1
stock split effective February 11, 1994.
15
Item 6. Selected Financial Data (Continued)
Fiscal Years Ended September 30
(Thousands Except Per Share 1994 1993 1992 1991 1990
Amounts) ---- ---- ---- ---- ----
Dividends Declared -
Common Stock $ 19,054 $ 18,938 $ 18,703 $ 18,703 $ 18,396
Dividends Declared Per
Share of Common Stock* $1.22 $1.215 $1.20 $1.20 $1.18
Utility Plant
Gross Plant-End of Period $709,563 $677,613 $643,587 $605,298 $572,210
Net Plant-End of Period 411,677 390,826 367,287 339,317 316,278
Construction Expenditures 39,193 40,880 44,660 38,291 29,211
Property Retirements 6,757 6,135 5,693 5,196 3,170
Total Assets 608,295 515,312 470,463 501,149 436,647
Capitalization -
End of Period
Common Stock and Paid-In
Capital $ 45,638 $ 43,702 $ 43,702 $ 43,702 $ 43,701
Retained Earnings 173,318 170,252 164,120 164,646 163,416
Treasury Stock (24,017) (24,017) (24,017) (24,017) (24,017)
-----------------------------------------------
Common Stock Equity 194,939 189,937 183,805 184,331 183,100
Redeemable Preferred Stk 1,960 1,960 1,960 1,960 1,966
Long-Term Debt 154,211 165,745 146,640 164,822 129,813
------------------------------------------------
Total Capitalization $351,110 $357,642 $332,405 $351,113 $314,879
================================================
Shares of Common Stock
Outstanding-End of Period* 15,670 15,586 15,586 15,586 15,586
Book Value Per Share* $12.44 $12.19 $11.79 $11.83 $11.75
<FN>
*Common share and per share amounts have been restated to reflect a 2-for-1
stock split effective February 11, 1994.
16
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,
1994 were $22.1 million, compared with $25.1 million for 1993 and $18.2
million for 1992. Earnings per share of common stock based on average
shares outstanding were $1.42 in 1994, compared with $1.61 in 1993 and $1.17
in 1992, restated to reflect the 2-for-1 stock split effective February 11,
1994. The $.19 per share decrease in fiscal 1994 (from fiscal 1993) was
primarily due to increases in the costs of doing business and decreased
sales volumes arising from warmer weather. These decreases were partially
offset by the one-month benefit of a general rate increase effective
September 1, 1994, designed to increase revenues by $12.2 million on an
annual basis. The $.44 per share increase in earnings in fiscal 1993 (over
fiscal 1992) was principally due to higher sales arising from colder
weather. Increases in the costs of doing business were essentially offset
by the benefit of the Company's general rate increase, which was placed in
effect September 1, 1992. Weather in the metropolitan St. Louis area was 1%
warmer than normal in 1994, 2% colder than normal in 1993, and 15% warmer
than normal in 1992.
Utility operating revenues for fiscal year 1994 increased $20.0 million, or
4.0%, above fiscal 1993, and 1993 increased $85.7 million, or 20.5%, above
fiscal 1992. The 1994 increase was due to higher wholesale gas costs of
$21.3 million (which are passed on to customers in accordance with the
Purchased Gas Adjustment Clause) and increased revenues arising from the
general rate increase effective September 1, 1994 of $.9 million. These
increases were partially offset by lower therms sold and transported
(principally due to the warmer weather) and other variations netting to
$2.2 million. The 1993 increase in revenues, compared with 1992, was
largely due to higher therms sold (reflecting the significantly colder
weather) and minor factors totalling $34.1 million, higher PGA levels of
$38.4 million, and increased revenues arising from the general rate increase
effective September 1, 1992 of $13.2 million. Therms sold and transported
for 1994 were 1,070.1 million compared with 1,080.1 million in 1993 and
971.5 million in 1992.
Utility operating expenses increased $22.7 million, or 4.9%, in fiscal 1994,
and 1993 increased $77.4 million, or 20.0%, above fiscal 1992. Natural and
propane gas expense increased $17.5 million in 1994 reflecting higher
natural gas prices, partially offset by reduced volumes required for
sendout. In 1993, natural and propane gas expense increased $55.5 million
due to increased volumes purchased for sendout and higher natural gas
prices. Other operation and maintenance expenses increased $5.5 million, or
5.7%, in 1994 mainly due to increased pension expense of $5.9 million,
reflecting the effect of recognition in fiscal 1993 of gains arising from
significant lump-sum settlements (no such gains were recognized during
fiscal 1994) coupled with higher net pension costs this fiscal year. This
increase was partially offset by several changes netting to a $.4 million
reduction in expense. These include a lower provision for uncollectibles,
reduced group insurance expenses, and other reductions in expense; the
benefits of which were largely offset by increased expense resulting from
the adoption of Statement of Financial Accounting Standard (SFAS) No. 106,
"Employers Accounting for Postretirement Benefits Other Than Pensions",
17
increased maintenance requirements, and higher contract wage rates. In
1993, other operation and maintenance expenses increased 9.9% reflecting
increased group insurance charges, higher distribution and maintenance
charges, increased wage rates, and other increases in the costs of doing
business. Depreciation and amortization expense increased 3.4% in 1994 and
3.7% in 1993 primarily as a result of additional depreciable property.
Taxes, other than income taxes, increased 3.8% in 1994 principally due to
higher gross receipts taxes (reflecting increased revenues). In 1993,
taxes, other than income taxes, increased 16.2% primarily due to higher
gross receipts taxes and increased property taxes. The variations in income
tax expense are mainly due to changes in income, and as a result of tax
adjustments recorded in 1993 related to prior years.
Miscellaneous income and income deductions (net of applicable income tax
expense) in 1994 were essentially the same as 1993, while 1993 was
$.8 million lower than 1992 reflecting lower interest income on temporary
cash investments.
Interest expense increased by 1.1% in fiscal 1994 primarily due to increased
short-term debt, largely offset by reduced interest on long-term debt
(reflecting the benefit of redemptions of First Mortgage Bonds totalling
$51.7 million in fiscal 1993 and $12.0 million in fiscal 1994, partially
offset by the effect of the issuance of $40 million of 7-1/2% First Mortgage
Bonds in November 1992 and $25 million of 6-1/4% First Mortgage Bonds in May
1993). The fiscal 1993 increase in interest expense was primarily due to
the aforementioned First Mortgage Bond issues, partially offset by the
effect of redemptions in 1992 and 1993.
On June 28, 1994, Company and Union representatives signed a new three-year
labor agreement replacing the prior agreement which was to expire July 31,
1994. The new contract extends through July 31, 1997. The settlement
resulted in wage increases of 3.5% in the first year, 3.25% the second year,
and 3.25% the third year. Other employee benefit improvements will be
effected during the three-year term.
On January 14, 1994, the Company filed a request with the Missouri Public
Service Commission (MoPSC) seeking a general rate increase of $27.1 million
annually. This filing culminated in a settlement, approved by the MoPSC on
August 22, 1994, providing the Company an annual increase in revenues of
$12.2 million effective September 1, 1994. The Company's last general rate
increase was effective on September 1, 1992, and amounted to $13.5 million
per year.
Accounting Changes
The Company implemented SFAS No. 109, "Accounting for Income Taxes",
effective October 1, 1993, without restating previously issued financial
statements. SFAS No. 109 prescribes the liability method of accounting for
income taxes, which required the Company to recognize additional deferred
tax assets and liabilities for certain temporary differences and to adjust
deferred tax accounts for changes in income tax rates.
SFAS No. 109 had no effect on the Company's cash flows or results of
operations due to the effect of rate regulation. Substantially all of the
adjustments required by SFAS No. 109 were recorded to deferred tax balance
18
sheet accounts, with offsetting adjustments to regulatory assets and
liabilities. At October 1, 1993 the cumulative effect of adopting SFAS
No. 109 was an increase in net deferred tax liabilities of $30.2 million,
and recognition of a regulatory asset of $30.2 million.
In the first quarter of fiscal year 1994, the Company adopted SFAS No. 106,
"Employers' Accounting for Postretirement Benefits Other Than Pensions
(OPEB)". In its 1992 rate case, the Company was authorized by the MoPSC to
recover OPEB on a pay-as-you-go basis and to defer the difference as a
regulatory asset. However, a regulatory asset was not recorded since it did
not meet the more stringent accounting criteria subsequently established in
the 1993 Emerging Issues Task Force consensus. In July 1994, a new state
law was enacted which requires SFAS No. 106 accrued costs to be recognized
for ratemaking purposes provided that such costs are funded through an
independent, external funding mechanism. The approved settlement of the
Company's 1994 rate case included recovery of such costs, effective
September 1, 1994. The Company is in the process of establishing funding
mechanisms which comply with the new law and the terms of the settlement.
In November 1992, the FASB issued SFAS No. 112, "Employers' Accounting for
Postemployment Benefits", which will require the Company to accrue the
estimated future cost of providing postemployment benefits to former or
inactive employees after employment but before retirement. Adoption of SFAS
No. 112 is required in fiscal year 1995. The Company does not expect the
adoption of SFAS No. 112 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
significant 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
19
the receipt of cash from our 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 1994,
the Company renewed its primary line of bank credit under which it may
borrow up to $40 million prior to January 31, 1995, with renewal of any
loans outstanding on that date permitted up to June 30, 1995. This primary
line of credit contained short-term step-up provisions providing an
additional $15 million of credit to January 27, 1994 and an additional
$5 million to February 28, 1994 which helped cover peak requirements during
those two months. The Company anticipates renewal of this primary line of
$40 million in January 1995. Additionally, beginning October 18, 1993, the
Company obtained a supplemental line of credit varying from $20 million to
$40 million through October 17, 1994 and $70 million from October 18, 1994
to March 1, 1995. Thus, at this writing, the total line of credit for the
1994-1995 heating season is $110 million, compared with a maximum of
$95 million during the 1993-1994 heating season. The Company anticipates
that the supplemental line will be reduced after March 1, 1995, since
seasonal cash needs typically decline significantly at the end of the
heating season. Short-term borrowings outstanding at September 30, 1994
were $53.5 million.
On April 13, 1993, the Company filed a Registration Statement with the
Securities and Exchange Commission (SEC) in connection with the sale of up
to $100 million of First Mortgage Bonds. The Registration Statement was
approved by the SEC and became effective for a two-year period commencing
April 21, 1993. The Company issued $25 million of First Mortgage Bonds in
May 1993 (the proceeds of which were used to redeem outstanding higher cost
debt) and has $75 million remaining related to this Registration Statement.
In a further effort to take advantage of lower interest rates, the Company
also redeemed $12 million of 7-1/2% First Mortgage Bonds in November 1993.
These bonds were originally scheduled to mature in 1997. The amounts,
timing, and types of future financings issued by the Company will depend on
cash requirements, market conditions, and other factors.
At the Annual Meeting held on January 27, 1994, the Company's share owners
approved an amendment which increased the authorized common stock to
50,000,000 shares with a new par value of $1.00 per share and reclassified
the par value of the outstanding common stock from $2.00 to $1.00 per share.
These changes were approved in connection with a 2-for-1 stock split
authorized by the Board of Directors which became effective February 11,
1994.
Share owners approved an amendment to the Company's Dividend Reinvestment
Plan at the January 27, 1994 meeting to permit cash purchases of common
stock through the Plan and the issuance by the Company of common stock under
the Plan. The Company filed a Registration Statement for the Plan with the
Securities and Exchange Commission on February 22, 1994. The Missouri
Public Service Commission granted the necessary approvals of the stock split
and Plan amendments by order dated January 4, 1994. During the last two
quarters of fiscal 1994, 83,561 shares were issued under the Company's
Dividend Reinvestment and Stock Purchase Plan. Total shares outstanding
were 15,670,023 at September 30, 1994.
Construction expenditures for utility purposes were $39.2 million in fiscal
1994 compared with $40.9 million in fiscal 1993 and $44.7 million in fiscal
1992. Fiscal 1992 expenditures were abnormally high compared to other years
mainly due to completion of construction of a 26-mile transmission line from
Washington, Missouri to Ellisville, Missouri.
20
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. Prior to the widespread
availability of natural gas, the Company operated various manufactured gas
plants, the last of which was closed in 1961. The process for manufacturing
gas produced by-products and residuals, including hydrocarbons such as lamp
black and coal tar. Certain remnants of these residuals are typically found
at former gas manufacturing sites. The United States Environmental
Protection Agency (EPA) has been engaged in a survey of a large number of
former manufactured gas plant sites across the nation.
In this regard, the Company and the EPA have determined that manufactured
gas residuals are present at one of the former manufactured gas plant sites
operated by the Company. While no conclusion has been reached as to the
extent of any remedial action that will be required, the Company and the EPA
have entered into an Administrative Order on Consent (AOC), effective
March 31, 1994, with regard to this site. The AOC provides for the Company
to conduct certain investigative activities (i.e., a removal site evaluation
and an engineering evaluation cost analysis), and to reimburse the EPA for
response costs under the AOC. The AOC requires only investigations and does
not cover any removal action. If remedial action is necessary, then a
subsequent order will cover such action. Based on currently available
information, management believes that the costs of the foregoing
investigations, response costs of the EPA in overseeing such investigations,
and other associated legal and engineering consulting costs are likely to
approximate $380,000. At September 30, 1994, $135,000 has been paid and a
liability of $245,000 remains to cover future payments.
The Company is presently unable to evaluate and quantify further the scope
or cost of any environmental response activity. However, the Company has
notified its insurers that the Company intends to seek reimbursement from
them of its investigation, remediation, clean-up and defense costs in regard
to the foregoing. In addition to pursuing insurance proceeds to the extent
feasible, the Company also plans to seek recovery, if practicable, from any
other potentially responsible parties.
An environmental cost deferral procedure was established by the Missouri
Public Service Commission in the Company's recent rate case, effective
September 1, 1994, for use by the Company in applying for appropriate rate
recovery of various investigation, remediation and other costs to be
incurred by the Company in connection with former manufactured gas plant
sites. The authorization to begin deferring such costs shall only be
triggered to the extent that the cumulative liability incurred by the
Company during the deferral period is not offset by the cumulative costs of
$250,000 per year reflected in the Company's current rates. In the event
the cumulative liability incurred by the Company for such costs during the
deferral period is less than the cumulative amount of such annualized costs
reflected in the rates approved in the settlement, then the Company shall
refund the difference. The above authorization will become null and void if
the Company does not file for a general rate increase by September 1, 1996,
and, in any event, the recovery of costs deferred thereunder is subject to
challenge in future rate cases.
On April 8, 1992, the Federal Energy Regulatory Commission (FERC) issued
Order No. 636 which adopted its final rule to restructure the Nation's
natural gas pipelines and the services they provide. Under the final rule,
21
the FERC is requiring natural gas pipelines to offer unbundled, or separate,
transportation and storage services and to eliminate their bundled merchant
sales and transportation service under which gas was sold to local
distribution companies at the city gate. The Company's long-term gas supply
contract with Mississippi River Transmission Corporation (MRT) was
terminated on November 1, 1993, and replaced with an agency agreement.
Under such new agreement, the Company will acquire its own gas supplies and
MRT will administer all functions necessary to deliver the gas to the
Company. Pursuant to this new arrangement, the Company has entered into
long-term and short-term gas supply arrangements with more than 17
suppliers, so as to provide adequate supplies for the foreseeable future.
The Company's PGA Clause has been revised to continue to flow through to its
customers increases and decreases in the Company's cost of purchased gas, as
such costs are incurred under the new Order No. 636 supply arrangements.
Capitalization at September 30, 1994, excluding current redemption
requirements of long-term debt, consisted of 55.5% common stock equity, .6%
preferred stock and 43.9% long-term debt. The Company's outstanding First
Mortgage Bonds are rated AA- by Fitch, Aa3 by Moody's, and AA- by Standard &
Poor's.
The Company's ratio of earnings before taxes to interest charges was 3.1 for
1994, 3.5 for 1993 and 2.7 for 1992.
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.
22
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, 1994 and 1993, and the related statements of
consolidated income, retained earnings, and cash flows for each of the three
years in the period ended September 30, 1994. Our audits also included the
financial statement schedules listed in the Index at Part IV, Item 14(a)2.
These financial statements and financial statement schedules are the
responsibility of the Company's management. Our responsibility is to
express an opinion on the financial statements and financial statement
schedules 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, 1994 and 1993, and the results of
their operations and their cash flows for each of the three years in the
period ended September 30, 1994 in conformity with generally accepted
accounting principles. Also, in our opinion, such financial statement
schedules, 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.
As discussed in Notes 1 and 2 to the consolidated financial statements,
effective October 1, 1993, Laclede Gas Company and its subsidiary companies
changed their method of accounting for income taxes to conform with
Statement of Financial Accounting Standards No. 109 and changed their method
of accounting for postretirement benefits other than pensions to conform
with Statement of Financial Accounting Standards No. 106.
Deloitte & Touche LLP
St. Louis, Missouri
November 17, 1994
23
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 six 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
Robert J. Carroll
- -----------------------------------
Senior Vice President-
Finance and Chief Financial Officer
24
Item 8. Financial Statements and Supplementary Data
STATEMENTS OF CONSOLIDATED INCOME
(Thousands Except Per Share Amounts)
Years Ended September 30
1994 1993 1992
---- ---- ----
Utility Operating Revenues $523,866 $503,948 $418,190
------------------------------
Utility Operating Expenses
Natural and propane gas 308,515 291,057 235,562
Other operation expenses 84,906 81,027 73,521
Maintenance 18,351 16,693 15,358
Depreciation and amortization 19,332 18,704 18,033
Taxes, other than income taxes 42,627 41,061 35,333
Income taxes (Note 7) 12,517 14,997 8,272
------------------------------
Total utility operating expenses 486,248 463,539 386,079
------------------------------
Utility Operating Income 37,618 40,409 32,111
Miscellaneous Income and Income Deductions-
Net (less applicable income taxes - Note 7) 993 971 1,777
------------------------------
Income Before Interest Charges 38,611 41,380 33,888
------------------------------
Interest Charges:
Interest on long-term debt 12,626 14,415 13,803
Other interest charges 3,768 1,798 1,811
------------------------------
Total interest charges 16,394 16,213 15,614
------------------------------
Net Income 22,217 25,167 18,274
Dividends on Preferred Stock 97 97 97
------------------------------
Earnings Applicable to Common Stock $ 22,120 $ 25,070 $ 18,177
==============================
Average Shares of Common Stock Outstanding 15,619 15,586 15,586
==============================
Earnings Per Share of Common Stock
(after preferred dividends) $1.42 $1.61 $1.17
==============================
<FN>
See the accompanying notes to financial statements.
25
STATEMENTS OF CONSOLIDATED RETAINED EARNINGS
(Thousands Except Per Share Amounts)
Years Ended September 30
1994 1993 1992
---- ---- ----
Balance at Beginning of Year $170,252 $164,120 $164,646
Add - Net income, per statements 22,217 25,167 18,274
-----------------------------
Total 192,469 189,287 182,920
-----------------------------
Deduct - Cash Dividends Declared:
Preferred stock at required annual rates 97 97 97
Common stock, $1.22 per share in 1994, $1.215
per share in 1993 and $1.20 per share in 1992 19,054 18,938 18,703
-----------------------------
Total 19,151 19,035 18,800
-----------------------------
Balance at End of Year $173,318 $170,252 $164,120
=============================
<FN>
See the accompanying notes to financial statements.
26
CONSOLIDATED BALANCE SHEETS
(Thousands of Dollars)
September 30
1994 1993
---- ----
Assets
Utility Plant $709,563 $677,613
Less - Accumulated depreciation & amortization 297,886 286,787
--------------------
Net utility plant 411,677 390,826
--------------------
Other Property and Investments, at Cost or Less
(net of accumulated depreciation and amortization,
1994, $9,447; 1993, $9,411) 22,956 22,668
--------------------
Current Assets:
Cash and cash equivalents 1,588 1,706
Accounts receivable:
Gas customers - Billed and unbilled 39,835 36,340
Other 4,207 4,255
Less - Allowances for doubtful accounts (credit) (4,943) (7,704)
Inventories:
Materials, supplies, and merchandise at avg cost 5,059 5,202
Natural gas stored underground for current use at
LIFO cost 48,333 14,079
Propane gas for current use at FIFO cost 13,582 13,657
Prepayments 1,853 1,774
Unamortized purchased gas adjustments 1,998 6,278
Deferred income taxes (Note 7) 3,717 -
--------------------
Total current assets 115,229 75,587
--------------------
Deferred Charges 58,433 26,231
--------------------
Total Assets $608,295 $515,312
====================
<FN>
See the accompanying notes to financial statements.
27
CONSOLIDATED BALANCE SHEETS (Continued)
(Thousands of Dollars)
September 30
1994 1993
---- ----
Capitalization and Liabilities
Capitalization, per statements:
Common stock equity $194,939 $189,937
Redeemable preferred stock 1,960 1,960
Long-term debt 154,211 165,745
--------------------
Total capitalization 351,110 357,642
--------------------
Current Liabilities:
Notes payable (Note 8) 53,500 27,500
Accounts payable 20,124 16,745
Refunds due customers 29,782 214
Advance customer billings 7,062 3,901
Current sinking fund requirements - 391
Wages payable 3,072 4,061
Dividends payable 4,937 4,906
Customer deposits 3,978 4,650
Interest accrued 6,951 6,946
Taxes accrued 9,855 11,545
Deferred income taxes (Note 7) - 2,312
Other current liabilities 4,930 6,026
--------------------
Total current liabilities 144,191 89,197
--------------------
Deferred Credits and Other Liabilities:
Deferred income taxes (Note 7) 76,662 36,989
Unamortized investment tax credits (Note 7) 8,329 8,682
Other 28,003 22,802
--------------------
Total deferred credits and other liabilities 112,994 68,473
--------------------
Commitments and Contingencies (Note 9)
Total Capitalization and Liabilities $608,295 $515,312
====================
<FN>
See the accompanying notes to financial statements.
28
STATEMENTS OF CONSOLIDATED CAPITALIZATION
(Thousands of Dollars)
September 30
1994 1993
---- ----
Common Stock Equity (Note 3):
Common stock, par value $1 per share:
Authorized - 1994, 50,000,000 shares;
1993, 40,000,000 shares
Issued - 1994, 17,535,661 shares;
1993, 17,452,100 shares $ 17,536 $ 17,452
Paid-in capital 28,102 26,250
Retained earnings, per statements 173,318 170,252
Treasury stock, at cost - 1994 and 1993,
1,865,638 shares (24,017) (24,017)
--------------------
Total common stock equity 194,939 189,937
--------------------
Redeemable Preferred Stock, par value $25 per share
(1,480,000 shares authorized)
issued and outstanding (Note 4):
5% Series B - 1994 and 1993, 71,890 shares 1,797 1,797
4.56% Series C - 1994 and 1993, 6,510 shares 163 163
--------------------
Total redeemable preferred stock 1,960 1,960
--------------------
Long-Term Debt (Note 5):
First mortgage bonds:
7-1/2% Series, due March 15, 1997 - 11,600
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
9-5/8% Series, due May 15, 2013 25,000 25,000
--------------------
Total 155,000 166,600
Unamortized discount, net of premium,
on long-term debt (789) (855)
--------------------
Total long-term debt 154,211 165,745
--------------------
Total Capitalization $351,110 $357,642
====================
<FN>
Preferred stock and long-term debt amounts are exclusive of current
maturities and sinking fund requirements.
See the accompanying notes to financial statements.
29
STATEMENTS OF CONSOLIDATED CASH FLOWS
(Thousands of Dollars) Years Ended September 30
1994 1993 1992
---- ---- ----
Operating Activities:
Net Income $22,217 $25,167 $18,274
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation and amortization 19,393 18,917 18,291
Deferred income taxes and investment
tax credits 508 5,202 227
Other - net 567 280 151
Changes in assets and liabilities:
Accounts receivable - net (6,208) (6,185) 27,189
Unamortized purchased gas adjustments 4,280 (2,552) 11,279
Deferred purchased gas costs (355) 459 (258)
Accounts payable 3,379 3,950 (3,148)
Refunds due customers 29,568 (4,064) (17,146)
Taxes accrued (1,690) 2,050 (1,261)
Natural gas stored underground (34,254) (2,843) (544)
Other assets and liabilities 6,280 (10,363) (7,212)
-------------------------------
Net cash provided by operating activities 43,685 30,018 45,842
-------------------------------
Investing Activities:
Construction expenditures (39,193) (40,880) (44,660)
Employee benefit trusts 1,006 (373) (1,035)
Investments - non-utility (1,673) (1,747) (1,786)
Other (655) (903) (372)
-------------------------------
Net cash used in investing activities (40,515) (43,903) (47,853)
-------------------------------
Financing Activities:
Issuance of first mortgage bonds - 65,000 -
Issuance of short-term debt 26,000 20,500 7,000
Issuance of common stock 1,973 - -
Dividends paid (19,126) (18,957) (18,800)
Retirement of first mortgage bonds (11,991) (51,660) (13,873)
Other (144) (2,614) -
-------------------------------
Net cash provided by (used in)
financing activities (3,288) 12,269 (25,673)
-------------------------------
Net Decrease in Cash and
Cash Equivalents (118) (1,616) (27,684)
Cash and Cash Equivalents at Beg of Year 1,706 3,322 31,006
-------------------------------
Cash and Cash Equivalents at End of Year $ 1,588 $ 1,706 $ 3,322
===============================
Supplemental Disclosure of Cash Paid
During the Year for:
Interest $15,769 $15,081 $15,537
Income taxes 11,732 9,489 8,745
<FN>
See the accompanying notes to financial statements.
30
SCHEDULE OF INCOME TAXES (Note 7)
(Thousands of Dollars)
Years Ended September 30
1994 1993 1992
---- ---- ----
Included in Statements of
Consolidated Income as:
Utility Operating Expenses:
Federal
Current $ 10,286 $ 8,833 $7,017
Deferred 720 5,024 528
Investment tax credit
adjustments - net (352) (332) (445)
State and local
Current 1,708 937 1,014
Deferred 155 535 158
------------------------------
12,517 14,997 8,272
------------------------------
Miscellaneous Income and Income Deductions:
Federal
Current 160 1,026 206
Deferred (12) (21) (10)
Investment tax credit
adjustments - net (2) (2) (4)
State and local
Current (24) 67 (20)
Deferred (1) (2) -
------------------------------
121 1,068 172
------------------------------
Total $12,638 $16,065 $8,444
==============================
<FN>
See the accompanying notes to financial statements.
31
SCHEDULE OF INTERIM FINANCIAL INFORMATION (Unaudited) (Note 10)
(Thousands of Dollars Except Per Share Amounts)
Three Months Ended
1994 Dec. 31 March 31 June 30 Sept. 30
- --------------------------------------------------------------------------
Utility Operating Revenues $167,245 $233,035 $74,644 $48,942
Utility Operating Income (Loss) 15,621 22,203 1,286 (1,492)
Net Income (Loss) 11,920 18,645 (2,738) (5,610)
Earnings (Loss) Per Share
of Common Stock
(after preferred dividends) $ .76 $1.19 $(.18) $(.36)
Three Months Ended
1993 Dec. 31 March 31 June 30 Sept. 30
- --------------------------------------------------------------------------
Utility Operating Revenues $160,044 $214,078 $75,993 $53,833
Utility Operating Income (Loss) 17,346 23,741 1,956 (2,634)
Net Income (Loss) 13,485 20,318 (2,142) (6,494)
Earnings (Loss) Per Share
of Common Stock
(after preferred dividends) $ .86 $1.30 $(.14) $(.41)
<FN>
See the accompanying notes to financial statements.
32
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.
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 1994, 1993 and 1992
averaged approximately 2.8% of the original cost of depreciable property.
In August 1994, the MoPSC approved a settlement agreement which authorized a
net increase in depreciation rates for the Company effective on September 1,
1994.
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, 1994 was less than the LIFO cost by $8,437,000,
and at September 30, 1993, exceeded the LIFO cost by $3,354,000. 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.
Oil & Gas Exploration and Development - The Company uses the full cost
method of accounting for utility exploration and development costs as
ordered by the Missouri Public Service Commission. 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 $812,000 in 1994,
$1,213,000 in 1993 and $1,125,000 in 1992.
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.
33
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
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 adopted Statement of
Financial Accounting Standard (SFAS) No. 109, "Accounting for Income Taxes"
effective October 1, 1993. SFAS No. 109 requires the establishment of
deferred tax liabilities and assets, as measured by enacted tax rates, for
the net tax effects of all temporary differences between the carrying
amounts of assets and liabilities for financial reporting purposes, and the
amounts used for income tax purposes.
Substantially all of the adjustments required by SFAS No. 109 were
recorded to deferred tax balance sheet accounts, with the corresponding
adjustments to regulatory assets and liabilities. At October 1, 1993, the
cumulative effect of adopting SFAS No. 109 was an increase in net deferred
tax liabilities of $30,200,000, and recognition of a regulatory asset of
$30,200,000. The adoption of this standard did not have an impact on the
Company's cash flows or results of operations due to the effect of rate
regulation. In 1993 and 1992, the Company accounted for income taxes in
accordance with the provisions of Accounting Principles Board Opinion No.
11.
The benefit of investment tax credits utilized prior to 1986 has been
deferred and is being amortized 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.
34
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 1994, 1993 and 1992 amounted to $1,895,000, $50,000
and $812,000, respectively, including amounts charged to construction.
The net pension costs (credits) include the following components:
(Thousands of Dollars) 1994 1993 1992
---- ---- ----
Service cost - benefits earned
during the period $ 6,467 $ 5,891 $ 5,715
Interest cost on projected benefit obligation 13,132 13,209 13,290
Actual return on plan assets 9,849 (50,003) (37,840)
Net amortization and deferral (27,553) 30,953 19,647
------------------------------
Net pension cost $ 1,895 $ 50 $ 812
==============================
The variance in net pension cost is primarily attributable to actuarial
and investment experience.
The following table sets forth the funded status of the plans and
amounts recognized in the Company's consolidated balance sheet at
September 30:
(Thousands of Dollars) 1994 1993
---- ----
Actuarial present value of benefit obligation:
Vested benefit obligation $122,709 $132,593
=====================
Accumulated benefit obligation $140,603 $148,616
=====================
Projected benefit obligation $174,539 $179,844
Plan assets at fair value 225,482 249,271
---------------------
Plan assets in excess of projected benefit obligation 50,943 69,427
Unrecognized net gain (40,793) (50,062)
Unrecognized prior service cost 15,483 7,700
Unrecognized net transition asset (8,717) (9,797)
Minimum liability adjustment (1,926) (2,380)
---------------------
Prepaid pension cost recognized in the
consolidated balance sheet $ 14,990 $ 14,888
=====================
The projected benefit obligation, which is based on a June 30
measurement date, was determined using a weighted-average discount rate of
8.25% for 1994 and 7.5% for 1993, and a weighted-average rate of future
compensation of 5.0% for 1994 and 4.5% for 1993. The expected long-term
rate of return on plan assets was 8.25% for 1994 and 9.0% for 1993.
35
Pursuant to the provisions of the Company's pension plans, pension
obligations may be settled by lump-sum cash payments. Significant
settlements in 1993 and 1992 resulted in pre-tax gains of approximately
$4,355,000 and $3,514,000, respectively. No such gains were recognized in
1994.
The cost of the Company's defined contribution plans, which cover
substantially all employees, amounted to $1,706,000, $1,595,000 and
$1,122,000 for the years 1994, 1993 and 1992, respectively.
The Company provides life insurance benefits to all employees after
retirement and medical insurance is available after early retirement until
age 65.
In the first quarter of fiscal year 1994, the Company adopted Statement
of Financial Accounting Standard (SFAS) No. 106, "Employers' Accounting for
Postretirement Benefits Other Than Pensions (OPEB)". Under the provisions
of SFAS No. 106, the future cost of providing these postretirement benefits
is recognized as an expense and a liability during the employees' service
periods. As permitted by SFAS No. 106, the liability for any unfunded
accumulated postretirement benefit obligations existing at October 1, 1993
is being recognized as a transition obligation and amortized over 20 years.
Prior to the adoption of SFAS No. 106, life insurance costs were accrued
systematically in order to provide for future payments. The cost of medical
insurance, net of payments by the retirant, was recognized as claims were
paid.
Postretirement benefit costs in 1994, 1993 and 1992 amounted to
approximately $6,063,000, $4,300,000 and $4,100,000, respectively, including
amounts charged to construction.
The 1994 net postretirement benefit cost consisted of the following
components:
(Thousands of Dollars) 1994
----
Service cost - benefits earned during the period $ 1,597
Interest cost on accumulated postretirement benefit obligation 2,767
Amortization of transition obligation 1,699
--------
Net postretirement benefit cost $ 6,063
========
The following table sets forth the funded status of the plans and amounts
recognized in the Company's consolidated balance sheet at September 30:
(Thousands of Dollars) 1994
----
Accumulated postretirement benefit obligation (APBO):
Retirees $(16,227)
Active Employees (20,827)
--------
Total APBO (37,054)
Unrecognized transition obligation 32,265
Unrecognized net gain (2,961)
--------
Accrued postretirement benefit cost $ (7,750)
========
36
The assumed health care cost trend rate used in measuring the
accumulated postretirement benefit obligation was 10% for 1994, 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,
1994 by $1,900,000 and the sum of the service cost and interest cost by
approximately $384,000. The weighted-average discount rate and weighted-
average rate of future compensation used in determining the accumulated
postretirement benefit obligation was 8.25% and 5.0%, respectively.
In its 1992 rate case, the Company was authorized by the MoPSC to
recover OPEBs on a pay-as-you-go basis and to defer, as a regulatory asset,
the difference between the accrued costs calculated under the provisions of
SFAS No. 106 and the actual pay-as-you-go costs. However, in January 1993,
the Emerging Issues Task Force (EITF) reached a consensus requiring more
stringent accounting criteria necessary to record a regulatory asset. The
1992 MoPSC authorization was not in conformity with the 1993 EITF consensus;
therefore, a regulatory asset was not recorded to reflect rate recovery of
these costs on a pay-as-you-go basis. However, in July 1994, a new state
law was enacted which requires SFAS No. 106 accrued costs to be recognized
for ratemaking purposes provided that such costs are funded through an
independent, external funding mechanism. The approved settlement of the
Company's 1994 rate case included recovery of such costs, effective on
September 1, 1994. The Company is in the process of establishing funding
mechanisms which comply with the new law and the terms of the settlement.
The 1994 rate case settlement also provided for the deferral, net of any
applicable tax effects, of the difference between the costs funded by the
Company to its external OPEB funding mechanisms and $6,100,000 of annualized
OPEB costs included in rates. Any such deferrals will be reflected in rates
established in the next general rate case proceeding.
In November 1992, the FASB issued SFAS No. 112, "Employers' Accounting
for Postemployment Benefits", which will require the Company to accrue the
estimated future cost of providing postemployment benefits to former or
inactive employees after employment but before retirement. Adoption of SFAS
No. 112 is required in fiscal year 1995. The Company does not expect the
adoption of SFAS No. 112 to have a material effect on the Company's
financial position or results of operations.
3. Common Stock and Paid-in Capital
At the Annual Meeting held on January 27, 1994, the Company's share owners
approved an amendment which increased the authorized Common Stock to
50,000,000 shares with a new par value of $1.00 per share and reclassified
the par value of the outstanding Common Stock from $2.00 to $1.00 per share.
These changes were approved in connection with a 2-for-1 stock split
authorized by the Board of Directors effective February 11, 1994. As a
result, common share and per share amounts in the consolidated financial
statements have been retroactively adjusted to reflect the stock split.
Share owners approved an amendment to the Company's Dividend
Reinvestment Plan at the January 27, 1994 meeting to permit cash purchases
of common stock through the Plan, with a minimum purchase of $100 per
calendar quarter up to a maximum purchase of $30,000 per calendar year. The
amendment also provides for the issuance of common shares by the Company to
provide shares purchased under the Plan. The Company filed a Registration
Statement for the Plan with the Securities and Exchange Commission on
February 22, 1994. During fiscal 1994, 83,561 shares were issued under the
Company's Dividend Reinvestment and Stock Purchase Plan. At September 30,
1994, a total of 15,670,023 shares were outstanding.
37
On March 27, 1986, the Company declared a dividend of one Common Share
Purchase Right for each outstanding share of common stock as of May 1, 1986.
The rights expire on May 1, 1996, and may be redeemed by the Company for
five cents 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 30% or more of the common stock.
Each right entitles its holder to buy one share of common stock at an
exercise price of $50. In certain circumstances, each right will entitle
the holder to purchase one share of common stock at one-third of the market
price, or to purchase, at the exercise price, common stock of an acquiring
entity having a value equal to twice the exercise price. A total of
15,670,023 rights were outstanding at September 30, 1994.
Paid-in capital increased $1,852,000 in 1994, reflecting the issuance
of common stock under the Dividend Reinvestment Plan. There were no changes
in paid-in capital in 1993 or 1992.
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 1994, 1993 and 1992 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. There are no sinking fund
requirements on preferred stock for the five years subsequent to September
30, 1994.
5. Long-Term Debt
There are no maturities or sinking fund requirements on long-term debt for
the five years subsequent to September 30, 1994.
Substantially all of the Company's utility plant is subject to the
liens of its mortgage.
The Company's mortgage contains provisions which restrict retained
earnings from declaration or payment of cash dividends. As of September 30,
1994, approximately $164,300,000 of consolidated retained earnings was free
from such restrictions.
In November 1993, the Company redeemed approximately $12 million (a
portion of which was current) of First Mortgage Bonds, 7-1/2% Series, due
March 15, 1997 at a cost of $12,100,000.
6. Fair Value of Financial Instruments
The carrying amounts and estimated fair values of the Company's financial
instruments at September 30, 1994, are as follows:
Carrying Fair
(Thousands of Dollars) Amount Value
-------------------
Cash and cash equivalents $ 1,588 $ 1,588
Short-term debt 53,500 53,500
Long-term debt 154,211 157,185
Redeemable preferred stock 1,960 1,583
38
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, 1994, 1993 and 1992 as shown on the Schedule of Income Taxes.
Deferred tax expense results from timing differences in the recognition of
revenue and expense for tax and book purposes in 1993 and 1992 and the
change in temporary tax differences in 1994. The sources of these
differences and the related tax effect of each are indicated below:
(Thousands of Dollars) 1994 1993 1992
---- ---- ----
Excess of accelerated over straight-line
depreciation $ 3,531 $ 3,477 $ 3,265
Excess of full cost accounting charges per books
over depreciation, intangible drilling and
unsuccessful exploration costs expensed on
tax return (281) (423) (380)
Gas costs deferred for book purposes and
expensed on tax return (reversal) (1,419) 772 (4,029)
Uncollectible accounts expense for books
(in excess of) less than expense
per tax return 962 (486) 77
Pension income (expense) per books
in excess of amounts recognized per tax return 66 2,697 2,088
Supplier refund income not recognized per books (907) - -
Postretirement insurance benefits expense
per books in excess of expense per tax return (1,149) - -
Other items - net 59 (501) (345)
--------------------------
Total deferred income tax $ 862 $ 5,536 $ 676
==========================
The effective income tax rate varied from the federal statutory income
tax rate for each year due to the following:
1994 1993 1992
---- ---- ----
Federal income tax statutory rate 35.0% 34.7% 34.0%
State and local income taxes,
net of federal income tax benefits 3.4 2.4 2.8
Certain expenses and payroll taxes capitalized
on books and deducted on tax return (3.0) (2.0) (3.1)
Reversal of deferred taxes related to gas costs (.1) .1 -
Taxes related to prior years - 2.1 (1.6)
Other items - net 1.0 1.7 (.5)
-----------------------
Effective income tax rate 36.3% 39.0% 31.6%
=======================
39
The significant items comprising the Company's net deferred tax
liability recognized in the consolidated balance sheet as of September 30,
1994 are as follows:
(Thousands of Dollars)
Deferred tax assets:
Reserves not currently deductible $13,481
Unamortized investment tax credits 5,269
Other 2,395
-------
Total deferred tax assets 21,145
-------
Deferred tax liabilities:
Relating to utility property 84,202
Pension 7,996
Other 1,892
-------
Total deferred tax liabilities 94,090
-------
Net deferred tax liability $72,945
=======
The net deferred tax liability is presented in the consolidated balance
sheet as current assets of $3,717,000, and deferred credits and other
liabilities of $76,662,000.
8. Notes Payable and Credit Agreements
The Company has a primary line of bank credit which permits borrowing of up
to $40 million at any time before January 31, 1995. Such borrowings are on
a 90-day basis, renewable from time to time, with no note maturing beyond
June 30, 1995. The borrowings may be repaid at any time without penalty.
The Company anticipates renewal of this primary line of $40 million in
January 1995. Additionally, beginning October 18, 1993, the Company
obtained a supplemental line of credit varying from $20 million to $40
million through October 17, 1994 and $70 million from October 18, 1994 to
March 1, 1995. Thus, at this writing, the total line of credit for the
1994-1995 heating season is $110 million, compared with a maximum of $95
million during the 1993-1994 heating season. The Company anticipates that
the supplemental line will be reduced after March 1, 1995, since seasonal
cash needs typically decline at the end of the heating season.
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 1994, the Company's short-term borrowing requirements
were met by the sale of commercial paper. As of September 30, 1994, the
Company had $53.5 million in commercial paper outstanding at an average
interest rate of 4.9%.
40
9. Commitments and Contingencies
The Company estimates fiscal year 1995 utility construction expenditures at
$39,300,000. The lease agreement covering the Company's general office space
extends through February 2000. The aggregate rental expense for fiscal year
1994 was $770,000. Annual minimum rental payments for years subsequent to
September 30, 1994 are $770,000 per year. The lease agreement provides for
an annual rent escalation which is not determinable as of the balance sheet
date but such escalations have historically been relatively minor. 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 $92 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 1995 to 2000.
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 $11.9 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 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. Prior to the widespread
availability of natural gas, the Company operated various manufactured gas
plants, the last of which was closed in 1961. The process for manufacturing
gas produced by-products and residuals, including hydrocarbons such as lamp
black and coal tar. Certain remnants of these residuals are typically found
at former gas manufacturing sites. The United States Environmental
Protection Agency (EPA) has been engaged in a survey of a large number of
former manufactured gas plant sites across the nation.
In this regard, the Company and the EPA have determined that
manufactured gas residuals are present at one of the former manufactured gas
plant sites operated by the Company. While no conclusion has been reached
as to the extent of any remedial action that will be required, the Company
and the EPA have entered into an Administrative Order on Consent (AOC),
effective March 31, 1994, with regard to this site. The AOC provides for
the Company to conduct certain investigative activities (i.e., a removal
site evaluation and an engineering evaluation cost analysis), and to
reimburse the EPA for response costs under the AOC. The AOC requires only
investigations and does not cover any removal action. If remedial action is
necessary, then a subsequent order will cover such action. Based on
currently available information, management believes that the costs of the
foregoing investigations, response costs of the EPA in overseeing such
investigations, and other associated legal and engineering consulting costs,
are likely to approximate $380,000. At September 30, 1994, $135,000 has
been paid and a liability of $245,000 remains to cover future payments.
The Company is presently unable to evaluate and quantify further the
scope or cost of any environmental response activity. The Company has
notified its insurers that the Company intends to seek reimbursement from
them of its investigation, remediation, clean-up and defense costs in regard
41
to the foregoing. In addition to pursuing insurance proceeds to the extent
feasible, the Company also plans to seek recovery, if practicable, from any
other potentially responsible parties.
An environmental cost deferral procedure was established by the
Missouri Public Service Commission in the Company's recent rate case,
effective September 1, 1994, for use by the Company in applying for
appropriate rate recovery of various investigation, remediation and other
costs to be incurred by the Company in connection with former manufactured
gas plant sites. The authorization to begin deferring such costs shall only
be triggered to the extent that the cumulative liability incurred by the
Company during the deferral period is not offset by the cumulative costs of
$250,000 per year reflected in the Company's current rates. In the event
the cumulative liability incurred by the Company for such costs during the
deferral period is less than the cumulative amount of such annualized costs
reflected in the rates approved in the settlement, then the Company shall
refund the difference. The above authorization will become null and void if
the Company does not file for a general rate increase by September 1, 1996,
and, in any event, the recovery of costs deferred thereunder is subject to
challenge in future rate cases.
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.
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 1994 and 1993
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.
42
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 27, 1994
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 9 through 18 in
the Company's proxy statement dated December 27, 1994 and is incorporated
herein by reference but the information under the captions "Compensation
Committee Report Regarding Compensation" and "Performance Graph" on pages 14
through 17 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 page 8 in the Company's
proxy statement dated December 27, 1994 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.
43
Part IV
Item 14. Exhibits, Financial Statement Schedules and Reports on
Form 8-K
(a) 1. Consolidated Financial Statements: 1994 10-K Page
For Years Ended September 30, 1994, 1993, and 1992:
Statements of Income 25
Statements of Retained Earnings 26
Statements of Cash Flows 30
Schedule of Income Taxes 31
As of September 30, 1994 & 1993:
Balance Sheets 27-28
Statements of Capitalization 29
For Years Ended 1994 & 1993:
Schedules of Interim Financial Information 32
Notes to Financial Statements 33-42
Independent Auditors' Report 23
Management Report 24
2. Supplemental Schedules
V - Property, Plant and Equipment 48-50
VI - Accumulated Depreciation and Amortization
of Property, Plant and Equipment 51-53
VII - Gurantees of Securities of Other Issuers 54
VIII - Reserves 55
IX - Short-Term Borrowings 56
X - Supplementary Income Statement Information 57
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 58.
(b) During the last quarter of fiscal year 1994, no reports on Form 8-K were
required to be filed by the Company.
44
(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.
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.
10.02 - Senior Officers' Life Insurance Program of
the Company.
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 Employ-
ees 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.
10.04 - Laclede Gas Company Supplemental Retirement
Benefit Plan, as amended and restated effec-
tive July 25, 1991.
10.05 - Laclede Gas Company Salary Deferral Savings
Plan, as amended through February 27, 1992.
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.
45
10.05e - Amendments to the Company's Salary Deferral
Savings Plan dated September 27, 1994.
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 Com-
pensation Plan for Non-Employee Directors,
adopted by the Board of Directors on
August 27, 1992.
10.08 - The Retirement Plan for Non-Employee Direc-
tors 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.
10.14 - 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.
46
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 15, 1994 By Robert J. Carroll
Robert J. Carroll
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
12/15/94 Robert C. Jaudes Chairman of the Board,
Robert C. Jaudes President and Chief
Executive Officer
(Principal Executive
Officer)
12/15/94 Robert J. Carroll Senior Vice President -
Robert J. Carroll Finance and Chief Financial
Officer (Principal Financial
and Accounting Officer)
12/15/94 Andrew B. Craig, III Director
Andrew B. Craig, III
12/15/94 Henry Givens, Jr. Director
Henry Givens, Jr.
12/15/94 James L. Hoagland Director
James L. Hoagland
12/15/94 C. Ray Holman Director
C. Ray Holman
12/15/94 Mary Ann Krey Director
Mary Ann Krey
12/15/94 William E. Nasser Director
William E. Nasser
-------------- Director
Boyd F. Schenk
12/15/94 Robert P. Stupp Director
Robert P. Stupp
12/15/94 H. Edwin Trusheim Director
H. Edwin Trusheim
47
SCHEDULE V (Page 1 of 3)
LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES
PROPERTY, PLANT AND EQUIPMENT
FOR THE YEAR ENDED SEPTEMBER 30, 1994
- ----------------------------------------------------------------------------
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
OTHER
BALANCE AT RETIRE- CHANGES- BALANCE AT
BEGINNING ADDITIONS MENTS DEBIT CLOSE
CLASSIFICATION OF PERIOD AT COST OR SALES (CREDIT) OF PERIOD
- ----------------------------------------------------------------------------
(Thousands of Dollars)
UTILITY PLANT:
Transmission plant $ 1,970 $ 23 $ - $ - $ 1,993
Distribution 568,884 37,176 4,136 - 601,924
Storage 23,905 28 137 - 23,796
Gas in underground
storage - noncurrent 5,884 - - - 5,884
General 39,515 2,506 1,469 - 40,552
Manufactured gas
production 8,676 175 1,015 - 7,836
Natural gas production
and gathering plant 2,852 - - (461)(c) 2,391
Other utility plant 22,230 10 - - 22,240
Unfinished
construction 3,027 (729)(a) - - 2,298
Gas plant acquisition
adjustment 499 - - (25)(b) 474
Gas plant held for
future use 160 4 - - 164
Intangibles 11 - - - 11
--------------------------------------------------
Total utility plant 677,613 39,193 6,757 (486) 709,563
--------------------------------------------------
OTHER PROPERTY:
Rights of way 50 - - - 50
Organization
expenses 3 - - - 3
Mains 1,984 - - - 1,984
Other 7,499 - - - 7,499
--------------------------------------------------
Total other property 9,536 - - - 9,536
--------------------------------------------------
TOTAL $687,149 $39,193 $6,757 $(486) $719,099
==================================================
<FN>
(a) Represents net change in unfinished construction during the year.
(b) Amortization of acquisition adjustments relating to Midwest Missouri
Gas Co. and St. Charles Gas Corp., in accordance with Missouri Public
Service Commission order in Case No. 17,873.
(c) Includes amortization of non-productive gas wells amounting to $(461).
48
SCHEDULE V (Page 2 of 3)
LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES
PROPERTY, PLANT AND EQUIPMENT
FOR THE YEAR ENDED SEPTEMBER 30, 1993
- ----------------------------------------------------------------------------
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
OTHER
BALANCE AT RETIRE- CHANGES- BALANCE AT
BEGINNING ADDITIONS MENTS DEBIT CLOSE
CLASSIFICATION OF PERIOD AT COST OR SALES (CREDIT) OF PERIOD
- ----------------------------------------------------------------------------
(Thousands of Dollars)
UTILITY PLANT:
Transmission plant $ 1,970 $ - $ - $ - $ 1,970
Distribution 535,423 37,251 3,790 - 568,884
Storage 23,927 80 102 - 23,905
Gas in underground
storage - noncurrent 5,884 - - - 5,884
General 38,098 3,368 1,951 - 39,515
Manufactured gas
production 8,914 54 292 - 8,676
Natural gas production
and gathering plant 3,547 - - (695)(c) 2,852
Other utility plant 22,146 84 - - 22,230
Unfinished
construction 2,984 43 (a) - - 3,027
Gas plant acquisition
adjustment 523 - - (24)(b) 499
Gas plant held for
future use 160 - - - 160
Intangibles 11 - - - 11
--------------------------------------------------
Total utility plant 643,587 40,880 6,135 (719) 677,613
--------------------------------------------------
OTHER PROPERTY:
Rights of way 50 - - - 50
Organization
expenses 3 - - - 3
Mains 1,984 - - - 1,984
Other 7,480 19 - - 7,499
--------------------------------------------------
Total other property 9,517 19 - - 9,536
--------------------------------------------------
TOTAL $653,104 $40,899 $6,135 $(719) $687,149
==================================================
<FN>
(a) Represents net change in unfinished construction during the year.
(b) Amortization of acquisition adjustments relating to Midwest Missouri
Gas Co. and St. Charles Gas Corp., in accordance with Missouri Public
Service Commission order in Case No. 17,873.
(c) Includes amortization of non-productive gas wells amounting to $(695).
49
SCHEDULE V (Page 3 of 3)
LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES
PROPERTY, PLANT AND EQUIPMENT
FOR THE YEAR ENDED SEPTEMBER 30, 1992
- ----------------------------------------------------------------------------
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
OTHER
BALANCE AT RETIRE- CHANGES- BALANCE AT
BEGINNING ADDITIONS MENTS DEBIT CLOSE
CLASSIFICATION OF PERIOD AT COST OR SALES (CREDIT) OF PERIOD
- ----------------------------------------------------------------------------
(Thousands of Dollars)
UTILITY PLANT:
Transmission plant $ 1,970 $ - $ - $ - $ 1,970
Distribution 495,226 43,771 3,587 13 (d) 535,423
Storage 23,915 18 6 - 23,927
Gas in underground
storage - noncurrent 5,884 - - - 5,884
General 36,504 3,683 2,089 - 38,098
Manufactured gas
production 8,863 62 11 - 8,914
Natural gas production
and gathering plant 4,200 - - (653) (c) 3,547
Other utility plant 22,096 50 - - 22,146
Unfinished
construction 5,916 (2,932) (a) - - 2,984
Gas plant acquisition
adjustment 548 - - (25) (b) 523
Gas plant held for
future use 165 8 - (13) (d) 160
Intangibles 11 - - - 11
--------------------------------------------------
Total utility plant 605,298 44,660 5,693 (678) 643,587
--------------------------------------------------
OTHER PROPERTY:
Rights of way 50 - - - 50
Organization
expenses 3 - - - 3
Mains 1,984 - - - 1,984
Other 7,462 18 - - 7,480
--------------------------------------------------
Total other property 9,499 18 - - 9,517
--------------------------------------------------
TOTAL $614,797 $44,678 $5,693 $(678) $653,104
==================================================
<FN>
(a) Represents net change in unfinished construction during the year.
(b) Amortization of acquisition adjustments relating to Midwest Missouri
Gas Co. and St. Charles Gas Corp., in accordance with Missouri Public
Service Commission order in Case No. 17,873.
(c) Includes amortization of non-productive gas wells amounting to $(653).
(d) Miscellaneous reclassifications.
50
SCHEDULE VI (Page 1 of 3)
LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES
ACCUMULATED DEPRECIATION AND AMORTIZATION OF PROPERTY,
PLANT AND EQUIPMENT
FOR THE YEAR ENDED SEPTEMBER 30, 1994
- ----------------------------------------------------------------------------
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
DEDUCTIONS
FROM RESERVES
ADDITIONS RETIREMENTS, BALANCE
BALANCE AT CHARGED CHARGED RENEWALS, AT
BEGINNING TO TO OTHER AND CLOSE OF
DESCRIPTION OF PERIOD INCOME ACCOUNTS REPLACEMENTS OTHER PERIOD
- ----------------------------------------------------------------------------
(Thousands of Dollars)
UTILITY PLANT:
Gas plant in
service $263,489 $18,225 $1,215(a) $6,733 $2,073(b) $274,123
Producing oil
land and land
rights 652 - - - - 652
Underground
storage land
and land rights 1,842 26 - 15 - 1,853
Other gas plant
in service 749 113 - 9 - 853
Exploration and
development
property 20,055 350 - - - 20,405
-----------------------------------------------------------
Total utility
plant 286,787 18,714(d) 1,215 6,757(c) 2,073 297,886
OTHER PROPERTY 9,411 36(e) - - - 9,447
-----------------------------------------------------------
TOTAL $296,198 $18,750 $1,215 $6,757 $2,073 $307,333
===========================================================
<FN>
(a) Includes salvage and depreciation charged to utility plant amounting to
$670 and $545, respectively.
(b) Cost of removal.
(c) Utility plant retirements amounted to $6,757 per Schedule V.
(d) Reflects depreciation on utility plant charged to utility operating
income.
(e) Depreciation on other property is charged to miscellaneous income and
income deductions - net. The reserve for depreciation is not
segregated on the books as between the classes of property shown on
Schedule V.
51
SCHEDULE VI (Page 2 of 3)
LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES
ACCUMULATED DEPRECIATION AND AMORTIZATION OF PROPERTY,
PLANT AND EQUIPMENT
FOR THE YEAR ENDED SEPTEMBER 30, 1993
- ----------------------------------------------------------------------------
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
DEDUCTIONS
FROM RESERVES
ADDITIONS RETIREMENTS, BALANCE
BALANCE AT CHARGED CHARGED RENEWALS, AT
BEGINNING TO TO OTHER AND CLOSE OF
DESCRIPTION OF PERIOD INCOME ACCOUNTS REPLACEMENTS OTHER PERIOD
- ----------------------------------------------------------------------------
(Thousands of Dollars)
UTILITY PLANT:
Gas plant in
service $253,641 $17,062 $871(a) $6,129 $1,956(b) $263,489
Producing oil
land and land
rights 652 - - - - 652
Underground
storage land
and land rights 1,816 26 - - - 1,842
Other gas plant
in service 654 104 - 6 3(b) 749
Exploration and
development
property 19,537 518 - - - 20,055
------------------------------------------------------------
Total utility
plant 276,300 17,710(d) 871 6,135(c) 1,959 286,787
OTHER PROPERTY 9,360 51(e) - - - 9,411
------------------------------------------------------------
TOTAL $285,660 $17,761 $871 $6,135 $1,959 $296,198
============================================================
<FN>
(a) Includes salvage and depreciation charged to utility plant amounting to
$311 and $560, respectively.
(b) Cost of removal.
(c) Utility plant retirements amounted to $6,135 per Schedule V.
(d) Reflects depreciation on utility plant charged to utility operating
income.
(e) Depreciation on other property is charged to miscellaneous income and
income deductions - net. The reserve for depreciation is not
segregated on the books as between the classes of property shown on
Schedule V.
52
SCHEDULE VI (Page 3 of 3)
LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES
ACCUMULATED DEPRECIATION AND AMORTIZATION OF PROPERTY,
PLANT AND EQUIPMENT
FOR THE YEAR ENDED SEPTEMBER 30, 1992
- ----------------------------------------------------------------------------
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
DEDUCTIONS
FROM RESERVES
ADDITIONS RETIREMENTS, BALANCE
BALANCE AT CHARGED CHARGED RENEWALS, AT
BEGINNING TO TO OTHER AND CLOSE OF
DESCRIPTION OF PERIOD INCOME ACCOUNTS REPLACEMENTS OTHER PERIOD
- ----------------------------------------------------------------------------
(Thousands of Dollars)
UTILITY PLANT:
Gas plant in
service $243,935 $16,158 $948(a) $5,693 $1,707(b) $253,641
Producing oil
land and land
rights 652 - - - - 652
Underground
storage land
and land rights 1,791 25 - - - 1,816
Other gas plant
in service 538 116 - - - 654
Exploration and
development
property 19,065 472 - - - 19,537
------------------------------------------------------------
Total utility
plant 265,981 16,771(d) 948 5,693(c) 1,707 276,300
OTHER PROPERTY 9,292 68(e) - - - 9,360
------------------------------------------------------------
TOTAL $275,273 $16,839 $948 $5,693 $1,707 $285,660
============================================================
<FN>
(a) Includes salvage and depreciation charged to utility plant amounting to
$433 and $515, respectively.
(b) Cost of removal.
(c) Utility plant retirements amounted to $5,693 per Schedule V.
(d) Reflects depreciation on utility plant charged to utility operating
income.
(e) Depreciation on other property is charged to miscellaneous income and
income deductions - net. The reserve for depreciation is not
segregated on the books as between the classes of property shown on
Schedule V.
53
SCHEDULE VII
LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES
GUARANTEES (1) OF SECURITIES OF OTHER ISSUERS
SEPTEMBER 30, 1994 (2) (3)
- ---------------------------------------------------------------------------
COLUMN A COLUMN B COLUMN C
Total
Name of Issuer of Amount
Securities Guaranteed by Title of Issue of Each Guaranteed
Persons for Which Class of Securities and
Statement is Filed Guaranteed Outstanding
- ------------------------ ---------------------- -----------
(Thousands of Dollars)
LACLEDE DEVELOPMENT COMPANY:
Centre Park Forty Bank Loan $ 1,218
Deutsch Enterprises Bank Loan 4,703
Plumbrook Ltd. Ptnrshp. Bank Loan 1,799
St. Peters Business Bank Loan and
Park Development Industrial Development
Bonds 2,518
63rd Street Associates Bank Loan 471
The Villages of
Cherry Hills Development Bank Loan 1,218
-------
$11,927
=======
<FN>
(1) For the purpose of this schedule, the references to "guarantees"
include instances where a subsidiary company is jointly and severally
liable for the repayment of indebtedness, whether as a general partner
of the debtor a general partner of the guarantor, or a direct
guarantor.
(2) Columns D, E and G have been omitted as the answers thereto would have
been "None".
(3) In answer to Column F, all guaranteed securities are guaranteed as to
principal and interest. In most cases the applicable rate of interest
floats with the prime interest rate. Currently, the annual aggregate
amount of interest is approximately $.9 million and will vary depending
upon changes in the prime interest rate.
54
SCHEDULE VIII
LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES
RESERVES
FOR THE YEARS ENDED SEPTEMBER 30, 1994, 1993 AND 1992
- ----------------------------------------------------------------------------
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
BALANCE AT ADDITIONS CHARGED DEDUCTIONS BALANCE AT
BEGINNING TO TO OTHER FROM AT CLOSE
DESCRIPTION OF PERIOD INCOME ACCOUNTS RESERVES OF PERIOD
- ----------------------------------------------------------------------------
(Thousands of Dollars)
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(d) 4,754 - - 4,754 -
-----------------------------------------------------
TOTAL $15,215 $2,667 $ - $6,637 $11,245
=====================================================
YEAR ENDED
SEPTEMBER 30, 1993:
DOUBTFUL ACCOUNTS $ 6,384 $4,842 $2,329 (a) $5,851 (b) $ 7,704
=====================================================
MISCELLANEOUS:
Injuries and
property damage $ 2,866 $2,027 $ - $1,209 (c) $ 3,684
Deferred compensation 6,251 684 - 158 6,777
Equalization group
insurance premium 5,139 1,076 - 1,461 4,754
-----------------------------------------------------
TOTAL $14,256 $3,787 $ - $2,828 $15,215
=====================================================
YEAR ENDED
SEPTEMBER 30, 1992:
DOUBTFUL ACCOUNTS $ 6,627 $4,235 $2,677 (a) $7,155 (b) $ 6,384
======================================================
MISCELLANEOUS:
Injuries and
property damage $ 2,816 $1,348 $ - $1,298 (c) $ 2,866
Deferred compensation 5,729 647 - 125 6,251
Equalization group
insurance premium 5,095 1,059 - 1,015 5,139
------------------------------------------------------
TOTAL $13,640 $3,054 $ - $2,438 $14,256
======================================================
<FN>
(a) Accounts reinstated, cash recoveries, etc.
(b) Accounts written off.
(c) Claims settled, less reimbursements from insurance companies.
(d) Adjusted as a result of the adoption of SFAS No. 106, "Employers'
Accounting for Postretirement Benefits Other Than Pensions" on
October 1, 1993.
55
SCHEDULE IX
LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES
SHORT-TERM BORROWINGS (1)
FOR THE YEARS ENDED SEPTEMBER 30, 1994, 1993 and 1992
- ----------------------------------------------------------------------------
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E COLUMN F
MAXIMUM AVERAGE WEIGHTED
----------------- AVERAGE
CATEGORY OF BALANCE WEIGHTED AMOUNT INTEREST
AGGREGATE AT AVERAGE OUTSTANDING RATE DURING
SHORT-TERM CLOSE OF INTEREST DURING PERIOD
BORROWINGS PERIOD RATE PERIOD (2)
- ----------------------------------------------------------------------------
(Thousands of Dollars)
YEAR ENDED
SEPTEMBER 30, 1994:
- ------------------
Commercial Paper $53,500 4.9% $95,000 $46,713 3.7%
YEAR ENDED
SEPTEMBER 30, 1993:
- ------------------
Commercial Paper $27,500 3.2% $32,000 $12,467 3.2%
YEAR ENDED
SEPTEMBER 30, 1992:
- ------------------
Commercial Paper $ 7,000 3.3% $14,000 $ 679 3.6%
<FN>
(1) See Note 8 of Notes to Financial Statements.
(2) Actual interest expense divided by average amount of debt outstanding
during this year.
56
SCHEDULE X
LACLEDE GAS COMPANY AND SUBSIDIARY COMPANIES
SUPPLEMENTARY INCOME STATEMENT INFORMATION
FOR THE YEARS ENDED SEPTEMBER 30, 1994, 1993 AND 1992
- ----------------------------------------------------------------------------
COLUMN A COLUMN B
ITEM CHARGED TO COSTS AND EXPENSES
- ----------------------------------------------------------------------------
1994 1993 1992
---- ---- ----
(Thousands of Dollars)
TAXES OTHER THAN INCOME:
Real Estate and Personal Property $ 8,140 $ 8,366 $ 7,454
Gross Receipts 28,994 27,406 23,000
Payroll Taxes 5,091 4,836 4,444
Manufacturer's State and City License 51 142 118
Other 351 311 317
-------------------------------
TOTAL $42,627 $41,061 $35,333
===============================
<FN>
In addition to the taxes shown above, there are sales, excise and other
taxes included in operating accounts, the total of which is not significant.
Maintenance and depreciation other than the amounts set out separately
in the statements of income were not significant. Rents, Royalties and
Advertising expenditures were less than 1% of gross revenues.
57
INDEX TO EXHIBITS
-----------------
Sequentially
Exhibit Numbered
No. Pages
- ------- ------------
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, as amended on
October 1, 1990; filed as Exhibit 3.01
to the Company's 10-K for the fiscal year
ended September 30, 1990 (File No. 1-1822).
3.01(ii)a* - Certified copy of resolutions of the Company's
Board of Directors adopted on November 21, 1991
amending Article IV, Section 1 of the Company's
By-Laws, effective January 22, 1992; filed as
Exhibit 3.01a to the Company's 10-K for the
fiscal year ended September 30, 1991 (File
No. 1-1822).
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 State-
ment 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).
* Incorporated herein by reference and made a part hereof.
58
INDEX TO EXHIBITS
-----------------
Sequentially
Exhibit Numbered
No. Pages
- ------- ------------
4.08* - 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).
4.08a* - 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).
4.09* - 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).
4.09a* - 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).
4.09b* - 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).
4.09c - Amendments to the Company's Wage Deferral 66
Savings Plan dated July 29, 1994.
4.09d - Amendments to the Company's Wage Deferral 76
Savings Plan effective August 1, 1994 and
adopted by the Board of Directors August 25,
1994.
* Incorporated herein by reference and made a part hereof.
59
INDEX TO EXHIBITS
-----------------
Sequentially
Exhibit Numbered
No. Pages
- ------- ------------
4.10* - Missouri Natural Gas Division of the Laclede
Gas Company Dual Savings Plan incorporat-
ing 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).
4.10a* - 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).
4.10b - Amendments to the Missouri Natural Gas 79
Division of Laclede Gas Company Dual Savings
Plan dated July 29, 1994.
4.11* - Rights Agreement dated as of April 17,
1986; filed on April 18, 1986 as Exhibit 1
to the Company's Form 8-A (File No. 1-1822).
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.
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 Com-
pany'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).
10.02* - Senior Officers' Life Insurance Program of
the Company, as amended; filed as Exhi-
bit 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).
* Incorporated herein by reference and made a part hereof.
60
INDEX TO EXHIBITS
-----------------
Sequentially
Exhibit Numbered
No. Pages
- ------- ------------
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 Employ-
ees 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).
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 84
of Laclede Gas Company - Management Employees
dated July 29, 1994.
10.04* - Laclede Gas Company Supplemental Retirement
Benefit Plan, as amended and restated effec-
tive 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).
* Incorporated herein by reference and made a part hereof.
61
INDEX TO EXHIBITS
-----------------
Sequentially
Exhibit Numbered
No. Pages
- ------- ------------
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).
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 86
Savings Plan, dated July 29, 1994.
10.05d - Amendments to the Company's Salary Deferral 89
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 92
Savings Plan dated September 27, 1994.
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).
10.06b* - Amendment to the Company's Deferred Com-
pensation 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).
* Incorporated herein by reference and made a part hereof.
62
INDEX TO EXHIBITS
-----------------
Sequentially
Exhibit Numbered
No. Pages
- ------- ------------
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* - 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).
10.07b* - 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).
10.07c* - Gas Purchase and Sales Agreement effective
November 1, 1990 between the Company and
ESCO Energy, Inc. and its affiliated
companies; filed as Exhibit 10.10d to the
Company's 10-K for the fiscal year ended
September 30, 1991 (File No. 1-1822).
10.08* - The Retirement Plan for Non-Employee Direc-
tors 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.
63
INDEX TO EXHIBITS
-----------------
Sequentially
Exhibit Numbered
No. Pages
- ------- ------------
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).
10.13* - 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).
* Incorporated herein by reference and made a part hereof.
64
INDEX TO EXHIBITS
-----------------
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Exhibit Numbered
No. Pages
- ------- ------------
10.15* - January 19, 1994 line of credit agreement with
Mercantile Bank of St. Louis, N.A.; filed as
Exhibit 10.2 to the Company's 10-Q for the
fiscal quarter ended March 31, 1994 (File
No. 1-1822).
10.16* - January 10, 1994 line of credit agreement with
The Boatmen's National Bank of St. Louis; filed
as Exhibit 10.3 to the Company's 10-Q for the
fiscal quarter ended March 31, 1994 (File
No. 1-1822).
10.17* - January 20, 1994 line of credit agreement with
Commerce Bank of St. Louis, N.A.; filed as
Exhibit 10.4 to the Company's 10-Q for the
fiscal quarter ended March 31, 1994 (File
No. 1-1822).
10.18* - January 10, 1994 line of credit agreement with
Chemical Bank; filed as Exhibit 10.5 to the
Company's 10-Q for the fiscal quarter ended
March 31, 1994 (File No. 1-1822).
10.19* - October 18, 1993 line of credit agreement with
Chemical Bank, The Boatmen's National Bank of
St. Louis and Mercantile Bank, N.A.; filed as
Exhibit 10.6 to the Company's 10-Q for the
quarter ended March 31, 1994 (File No. 1-1822).
10.19a* - Amendment and Extension dated April 18, 1994 of
Line of Credit Agreement dated October 18, 1993
among Laclede Gas Company, Chemical Bank, The
Boatmen's National Bank of St. Louis and
Mercantile Bank of St. Louis National
Association; filed as Exhibit 10 to the Company's
10-Q for the quarter ended June 30, 1994 (File
No. 1-1822).
10.19b - Amendment and Further Extension dated 97
August 18, 1994 of Line of Credit Agreement
dated October 18, 1993 among Laclede Gas Company,
Chemical Bank, The Boatmen's National Bank
of St. Louis and Mercantile Bank of St. Louis
National Association.
12 - Ratio of Earnings to Fixed Charges. 100
22 - Subsidiaries of the Registrant. 101
24 - Consent of Independent Public Accountants. 102
27 - Financial Data Schedule UT 103
* Incorporated herein by reference and made a part hereof.
65