Exhibit 1
---------
THE LACLEDE GROUP, INC.
American Gas Association
Financial Analysts Conference
May 6, 2002
DOUGLAS H. YAEGER
Chairman, President and
Chief Executive Officer
WHERE WE'VE BEEN
* We were essentially a "pure play" LDC
* Underwent a formal strategic review and planning process
1
LACLEDE GAS COMPANY
2001 SELF-ASSESSMENT
* Highly saturated, mature core market
- Primarily residential
* Overwhelmingly regulated operations
* Limited opportunities for sustainable growth
* Operational improvement opportunities
* Pockets of excellence
2
STRATEGIC OPTIONS SELECTION
* THE CHOICE OF STRATEGIC OPTIONS
MAINTAIN HARVEST EXTEND BROADEN
KEEP SELL IMPROVE PARLAY BRANCH
STATUS CORE CORE OUT
QUO
* AREAS OF FOCUS
3
OVERALL STRATEGIC DIRECTION
* Stabilize and improve the core gas distribution business
* Add a growth component
4
KEY ELEMENTS OF CORE UTILITY STRATEGY
* Stabilize earnings
* Overcome weather volatility
* Achieve a regulatory compact that allows us to focus on business results
5
KEY ELEMENTS OF GROWTH STRATEGY
* Extend or broaden value elements in our existing business or markets
* Provide an opportunity to achieve sustainable growth
- 20% of earnings within 5 years
* Constructed of "enterprises" that fit together well
6
FIRST STEP
CORPORATE STRUCTURE
* Formation of Holding Company
- Announced in October 2000
- Shareholder approval in January 2001
* Over 94% of shareholder votes in favor of formation
- The Laclede Group, Inc. operational October 1, 2001
7
ORGANIZATIONAL DIRECTION
THE LACLEDE GROUP, INC
CORE GROWTH
COMPONENTS
8
LACLEDE GAS COMPANY
Regulated Operations
9
OUR SYSTEM & STRENGTHS
* Largest LDC in Missouri [map]
* 630,000 customers
* Diversified gas supply portfolio
* Significant natural gas and propane storage capacity
10
UPSTREAM PIPELINE TRANSPORTATION NETWORK
DIRECT PIPELINE INTERCONNECTS
[map]
11
UPSTREAM PIPELINE TRANSPORTATION NETWORK
OVERALL SYSTEM
[map]
12
GAS SUPPLIES
GEOGRAPHIC DIVERSITY
[graph]
Hugoton Arkla-Tex Offshore Gulf Onshore Texas Arkoma Onshore South
Anadarko Basin Region Coast Region Region Basin Louisiana Region
42% 22% 14% 9% 8% 5%
13
UNDERGROUND STORAGE
* Upstream capacity
- Over 23 BCF on MRT's system in Louisiana
* Company-owned market area capacity
- Natural gas - over 5 BCF
- Liquid propane - 3 BCFe
* Total storage assets sufficient to provide 33% of normal annual throughput
14
PEAK DAY REQUIREMENTS
* 1.2 Bcf peak day
* Flowing gas capacity
- 700,000 MMBtu
* Market area peak shaving storage capacity
- 500,000 MMBtu
- Nearly 42% of total peak requirements
* Combined upstream and market area storage capable of meeting about 70%
of peak day
15
TRADITIONAL MARKET PROFILE
* Sales primarily residential & commercial heating
- 67% of net revenues are residential
- 98% of new homes are heated with gas
- Heating market saturation about 86%
* HVAC service work
- One of the largest service area providers
* Merchandising business
16
NON-TRADITIONAL ACTIVITIES
* Off-system sales
* Capacity release revenues
* Incentive programs
17
OUTLOOK FOR FURTHER DEREGULATION
* Major industrial customers have transportation service
* No real public interest
* No real consensus as to benefits or appropriate structure
18
CURRENT INITIATIVES
* Rate Cases
- $15 million increase effective December 1, 2001
- Current case
* Filed for $36.1 million increase on January 25, 2002
* Resolve remaining issues in current case
* Seeking Weather Mitigation Clause
* New rates effective by December 25, 2002
19
CURRENT INITIATIVES
* Improved PGA clause
* Gas Supply Incentive Plan proposals
* Formalized business planning process
20
SECOND STEP
Growth Component
21
WHY THE LOCATING BUSINESS?
* A growth industry
- One-call systems
- Legislative mandates
- Increase in underground facilities
* Business familiar to Laclede
- 100,000 "in-house" locates every year
22
UNDERGROUND LOCATING INDUSTRY ATTRACTIVENESS
* Underground locating is a high growth industry with few players
- Organic growth (legislation, infrastructure buildout, housing starts)
- Rapid outsourcing growth trend across utility companies
- Consolidation due to economies of scale
[graph]
Total U.S.
Market(1)
$1.1 B
Outsourced 36% $400 M Annual growth rate 17%
Performed In House 64%
Annual Growth Rate Up 12%
SM&P 26%
Annual Growth Rate 12%
(1) 1999 underground locating market
23
WHAT IS LOCATING?
[pictures]
24
SM&P UTILITY RESOURCES, INC.
Nonregulated Operations
25
SM&P
BUSINESS DESCRIPTION
* One of the largest U.S. locates outsourcers
* Dominant player within regional footprint
* Five year "same states" revenue growth of 18% per year
* Performs over 10 million locates a year
26
WHY SM&P?
* SM&P met all our strategic selection criteria
- Right size
- Earnings stability (with "counter-seasonal" business)
- Growing industry
- Logical and credible
- Expandable
* Business basics in place
- Focus on quality
* Industry approaching a "flex point"
- Breakaway opportunity
* Accretive in year one
27
SM&P
GEOGRAPHIC COVERAGE
SM&P SERVICE TERRITORY
[map showing service territory of Minnesota, Michigan, Wisconsin, Illinois,
Indiana, Ohio, Missouri, Kansas, Oklahoma, and Texas]
Operations in 10 Midwest States
28
SM&P ACQUISITION
* Purchased from NiSource for $43 million
* Annual revenues of $130 million in 2001
* Financed with 364-day bridge loan
* Expect to refinance with securities that include a high equity content
29
THE LACLEDE GROUP, INC.
Financial Review
30
HISTORICAL EARNINGS AND
DIVIDENDS PER SHARE
[graph]
1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996
Dividends
Per Share $0.54 $0.60 $0.65 $0.75 $0.85 $0.95 $1.05 $1.10 $1.15 $1.18 $1.20 $1.20 $1.22 $1.22 $1.24 $1.26
Earnings
Per Share $0.79 $1.08 $0.96 $1.70 $1.64 $1.87 $1.44 $1.57 $1.45 $1.18 $1.28 $1.12 $1.61 $1.42 $1.27 $1.87
1997 1998 1999 2000 2001
Dividends
Per Share $1.30 $1.32 $1.34 $1.34 $1.34
Earnings
Per Share $1.84 $1.58 $1.43 $1.37 $1.61
31
HISTORICAL DIVIDEND PAYOUT RATIO
[graph]
1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001
Dividend
Pay Out 68% 56% 68% 44% 52% 51% 73% 70% 79% 100% 94% 107% 76% 86% 98% 67% 71% 84% 94% 98% 83%
32
HISTORICAL DIVIDEND YIELD
[graph]
1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996
Dividend
Yield 10.7% 11% 9.1% 7.5% 6.6% 5.6% 6.3% 7.5% 7.4% 7.2% 7.1% 6.4% 5.4% 5.6% 6% 5.6%
1997 1998 1999 2000 2001
Dividend
Yield 5.3% 5.2% 5.7% 6.3% 5.7%
33
HISTORICAL STOCK PRICE
[graph]
1981 1982 1983 1984 1985 1986 1987 1988 1989 1990 1991 1992
High 6 6.375 8.25 12.125 15 19.875 20.25 15.9375 17 18 18.6875 20.5
Low 4.125 4.5625 6.0625 7.875 10.75 14 13 13.5 14 14.625 14.9375 16.9375
Average 5.0625 5.46875 7.15625 10 12.875 16.9375 16.625 14.71875 15.5 16.3125 16.8125 18.71875
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 Year To Date
High 24.9375 25.625 23.125 24.875 28.625 27.9375 27 24.75 25.4 24.9
Low 20 18.25 18.375 20 20.25 22.375 20 17.5 21.25 22
Average 22.46875 21.9375 20.75 22.4375 24.4375 25.15625 23.5 21.125 23.325 23.45
34
EARNINGS PER SHARE
[graph]
1998 1999 2000 2001 6 Mos. 6 Mos.
3/01 3/02
1.58 1.43 1.37 1.61 0.98 0.41
Percentage Colder / (Warmer) Than Normal
1998 1999 2000 2001 6 Mos. 6 Mos.
3/01 3/02
(6.0%) (11.2%) (15.6%) 9.4% 13.1% (16.0%)
35
FINANCIAL PROFILE
* Laclede Group filed a $500 million universal shelf registration
* Laclede Gas has a $270 million universal shelf remaining
* Solid debt ratings
* 15% of shares outstanding held by employees, officers and directors
* 25% institutional ownership
36
WHAT'S NEXT
* Continue efforts to stabilize and improve the core business
* Improve and grow SM&P
* A measured approach to growth
37
THE LACLEDE GROUP, INC.
American Gas Association
Financial Analysts Conference
May 6, 2002
THIS PRESENTATION CONTAINS FORWARD-LOOKING STATEMENTS WITHIN THE MEANING
OF SECTION 21E OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.
FUTURE OPERATING RESULTS MAY BE AFFECTED BY VARIOUS UNCERTAINTIES AND
RISK FACTORS, MANY OF WHICH ARE BEYOND THE CONTROL OF THE LACLEDE GROUP,
INC, INCLUDING WEATHER CONDITIONS, GOVERNMENTAL AND REGULATORY POLICY
AND ACTION, THE COMPETITIVE ENVIRONMENT AND ECONOMIC FACTORS. FOR A
MORE COMPLETE DESCRIPTION OF THESE UNCERTAINTIES AND RISK FACTORS, SEE
THE LACLEDE GROUP'S FORM 10-Q FOR THE QUARTER ENDED MARCH 31, 2002 FILED
WITH THE SECURITIES AND EXCHANGE COMMISSION.
38
APPENDIX
Page 13 contains a pie chart that has been presented in a tabular format.
Page 23 contains charts that have been presented in a tabular format.
Pages 31, 32, 33, 34 and 35 contain graphs that have been presented in a
tabular format.